July 1, 2016

Partly cloudy

Hit with $300K sewer bill, Medina businessman talks possible move

Shawn Ritchie

Shawn Ritchie

When Shawn Ritchie, CEO of Medina Plating, got the estimated county sewer cost for his newly purchased building, he thought it was a typo.

The bill was more than $300,000.

It wasn’t a typo, but it was a mistake.

After buying the 60,000-square-foot building, 910 Lake Road, Medina, Ritchie estimated that the plant, operating at full capacity, would use 30,000 gallons of water daily.

That estimate is what jacked the county “sewer benefit fee” so high, county officials said.

The benefit fee, also called a “change of use” fee, is a one-time cost paid by businesses that increase their operations by buying new buildings or expanding old facilities, Medina County Sanitary Engineer Amy Lyon-Galvin explained.

In response to Ritchie’s complaints, Lyon-Galvin advised him to lower his estimate to what he would use in the first years of operation — 5,000 gallons per day.

The new usage figure knocked the bill down to $52,010, which could be paid in installments over 10 years.

Ritchie said he’s willing to pay the $52,010 — but not a dime more. And that’s the problem: County officials say Richie could be hit with an additional bill if his water usage goes higher.

If that happens, Richie said he would move his expanded operation — and its 30 jobs — to Kentucky, which offered him $350,000 in incentives to move his business there.

“We’re shooting ourselves in the foot here,” he said. “Nobody’s going to move their business here with fees like this.

“If we have to pay that fee, we will not be in Medina. And I would support any other business who didn’t pay it either because it’s ridiculous.”

After hearing Ritchie’s complaints, county commissioner agreed July 22 to authorize an analysis of the county sewer rates and fees.

Lyon-Galvin said county officials will be interviewing two companies Friday and she hopes one of them will be named Tuesday to do the rate study.

She said the company will have until Oct. 31 to complete the study, but Ritchie wants an answer within two weeks.

Ritchie, who became CEO of Medina Plating, 940 Lafayette Road about a dozen years ago, said he already put $200,000 into the Lake Road building and installed $2 million in equipment used to make parts for the auto industry.

He added that he was in the process of purchasing a fourth building in Medina, but when he learned about the benefit fee, he canceled the deal.

“I had all of this momentum going and then I got this bill,” he said.

Several businessmen, Greater Medina Chamber of Commerce members and economic development officials attended Tuesday’s commissioners’ meeting in support of Ritchie.

“We never want to see a business leave, but we certainly don’t want to see them leave for the wrong reasons,” said Michael K. Baach, president and CEO of Philpott Rubber Co. in Brunswick. “Inaction is not an acceptable outcome.

“As businesspeople, we’d like him to stay in Medina because seeing businesses leave, especially manufacturing, is a travesty.”

Eric Shaffer, chairman of the chamber’s board of directors, thanked commissioners for approving the rate study.

“The chamber is supportive of changes to the fee policy that would help mitigate cost and encourage repurposing of existing facilities and job retention and creation,” he said.

Medina Mayor Dennis Hanwell also attended Tuesday’s meeting. He told commissioners he feared that if Ritchie moves his new facility to Kentucky, he’ll eventually move the entire business, which employs about 300 people.

“Three hundred employees is a pretty significant number,” Hanwell said. “There’s no doubt in my mind that if they take a portion of their operation to Kentucky, the rest will soon follow.

“There should be a better way to stay in the black than on the backs of businesses.”

Bethany Dentler, executive director of the Medina County Economic Development Corp., suggested Tuesday that commissioners create a fee policy that would allow for predictability and “incentivize businesses to move forward with an investment.”

“If the commissioners wanted to create a new economic development tool, they could choose to create a policy to wave a portion of a change of use fee above a certain dollar amount of the fee,” she said.

Commissioner Steve Hambley said the benefit fee, which was established in the 1980s, pays for capital improvements to the county’s aging sewer lines as well as to pay off debt for plant expansions.

“We prefer customers and business to thrive, but we have to make sure the bills get paid,” he said. “This is really about equity: If you’re using more, you’re going to pay more.”

Hambley said Medina County has the lowest monthly usage rate in the region, which should be an attraction to businesses.

He said Lyon-Galvin and County Administrator Chris Jakab are working on proposals for next week’s meeting that would establish a temporary fee policy until the rate study is complete.

“We have to make sure what we offer Ritchie, we offer to other businesses in the future,” Hambley said.

Contact reporter Katie Anderson at (330) 721-4012 or kanderson@medina-gazette.com.

Katie Anderson About Katie Anderson

Katie Anderson covers Medina County government and the city of Wadsworth. She has been with The Gazette since July 2014. Contact her at (330) 721-4012 or via email at kanderson@medina-gazette.com.