Closed plant to pay Ottawa $4.2M

Employees leave the LG Philips Displays plant in Ottawa, Ohio, in April, 2000. Philips closed the factory in December, 2002, idling 1,100 workers. At one time, the firm employed 2,100 people there.

LG Philips Displays has agreed to pay $4.2 million to settle a dispute with the village of Ottawa, Ohio, over tax abatements and sewer-system work done to accommodate the company s now-closed television tube plant in Putnam County.

The money, to be paid over four years, starting in January, will be split among the village, Putnam County, Ottawa Township, and the Ottawa-Glandorf Local Schools, said Jeff Loehrke, Ottawa s community development director.

Philips closed its Ottawa factory in December, 2002, idling 1,100 workers. At one time, the company employed 2,100 people there, and two 10-year tax abatements signed in 1994 and 1995 required the plant to retain at least 1,700 workers.

Philips announced plans in April, 2000, to move TV tube production to Mexico within three years and began shrinking its work force.

Mr. Loehrke said the settlement, which Ottawa Village Council approved this week, is important in two regards.

“The real important thing is that this kind of closes a chapter for us on the Philips saga,” he said. “It also removes one of the barriers that was in place to actually sell that building to a prospective industry.”

Mr. Loehrke said the Ohio Department of Development is trying to find a buyer for the old plant, which opened in 1948.

“They have indicated to us that there has been interest in the building,” he said.

The first tax abatement, negotiated in 1994, abated 80 percent of the personal property taxes on a $28.5 million plant expansion. The second agreement, signed in 1995, granted Philips a 100 percent abatement on real and personal property taxes for an $18 million expansion and $75 million in new equipment.

In addition, the village upgraded its wastewater treatment plant to handle the Philips expansion. Mr. Loehrke said the settlement includes $2.1 million for the voided tax abatements and an equal amount for the sewer work.

The village will get $2.2 million, mostly for the treatment plant work. The school district will receive $1.5 million, the county will be paid $359,327, and the township will get $26,151.

Those amounts may change slightly if Philips prepays some or all the settlement amounts, said Clyde Schroeder, Ottawa s village solicitor. The two sides agreed that Philips would pay $1.5 million in January, 2004; $800,000 in December, 2005; $900,000 in December, 2006, and $1 million in December, 2007.

James Casey, a Philips attorney who negotiated the agreement with Ottawa, could not be reached for comment.

David Lewis, superintendent of Ottawa-Glandorf schools, said he is satisfied with the settlement. The school board will vote on the agreement at a special meeting at 4:30 p.m. today in the district s administration office.

“We re real pleased with the work that the village officials have done to get this settlement, and we do feel it s a fair sum,” Mr. Lewis said.