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Tecumseh to cap Bethlehem Steel site before sale

The owner of the sprawling former Bethlehem Steel property in Lackawanna wants to finish covering up the once-contaminated soil with a 1-foot-thick "slag" barrier to prepare it for resale and redevelopment to an affiliate of the Erie County Industrial Development Agency.

But first it wants ECIDA to give it $175,000 in sales tax breaks to get the job done, or it will raise the sales price by the same amount.

Tecumseh Redevelopment, the subsidiary of steelmaker ArcelorMittal, which owns the 105-acre property, plans to construct a cover over 93.45 acres as part of its participation in the state's Brownfield Cleanup Program. That would allow it to qualify for brownfield tax credits for future users or developers of parts of the land, making it more desirable and valuable.

The work includes clearing the site, preparing the subgrade layer and placing a plastic demarcation layer over it, building in construction-related storm-water controls, and setting up air-monitoring systems. Public roads and utilities would also be added.

The $3.46 million project is a condition of the purchase agreement between Tecumseh and the Buffalo and Erie County Industrial Land Development Corp., which will take control of the property and market it for sale to others as shovel-ready commercial or light-industrial land.

The land is part of a broader project to turn the long-abandoned Bethlehem Steel site into an industrial park. The Erie County Industrial Development Agency last month finalized a deal to acquire nearly 148 acres of land along Route 5 for $6.7 million from Tecumseh.

Normally, the tax-exempt industrial land development agency would just acquire the property and do the work itself, said ECIDA Executive Vice President John Cappellino. But the property is being cleaned up under older state rules, which requires the property owner to put the cover on the soil by year-end – under a strict state schedule – in order to get its "certification of completion" and qualify for the credits.

Because of that tight time frame, Cappellino explained, there isn't enough time for the development corporation to take ownership and perform the work. So Tecumseh is effectively acting as its agent, and the sales tax benefit will pass through to the agency.

A public hearing will be held at 9 a.m. March 28 in Lackawanna City Hall, 714 Ridge Road, and comments will be accepted through April 25. Officials hope to start work by May 30 and finish by Nov. 30. The first occupancy on the site could be at the end of 2018.

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