The proposed Marina District advanced last night after the Toledo-Lucas County Port Authority voted to sacrifice one of its cash cows to push ahead the East Toledo riverfront development.
After a special, closed-door meeting with top city leaders, the port authority's board voted 7-0 to forgo nearly $4 million in guaranteed lease payments through 2026 and eventually give up land worth $3 million. The action will spur the cleanup of land needed for the Marina District.
“It was a difficult decision,” said Tom Palmer, the board's vice chairman. “But we understood the sacrifice had to be made by the port authority.”
The deal - which still must be formally drawn up and approved - is the linchpin of a series of land swaps to start cleaning up 125 acres of polluted land between the Martin Luther King, Jr., Bridge and I-280.
The deal's goal is to move the George Gradel construction company from the middle of the Marina District property to about a mile downstream on land the port authority owns.
But it wasn't simple, because that land is leased and subleased to two companies, Heidtman Steel and E.S. Wagner, who pay the agency $325,000 a year. Until the deal was reached, they had to pay that for 25 more years.
Those two firms needed to approve moving Gradel to land they controlled, so the city got the port authority to shorten the lease to just 12 more years, saving the two firms $3.9 million.
The city is buying eight acres of that land for $500,000, but the port authority has to give up ownership of the rest of the land in 12 years. The balance of the property is valued by the port authority at $3 million.
City leaders have been acting as an intermediary between the port authority and the three firms. Mayor Jack Ford himself stumped a nearly identical proposal just two days earlier at a special, closed-door board meeting that would have shortened the lease to 15 years.
But Councilman Pete Gerken, one of the city's lead negotiators, said Heidtman and Wagner representatives wanted the shorter time period, so the port authority had to give up the extra three years, or nearly $1 million in lease payments.
The port bought the land in 1985 for $3.2 million and leased it to Heidtman in late 1986. So far, the agency has earned $5.1 million on the lease.
The Gradel relocation is not a new idea. Two years ago, port authority leaders and Marina District developer Frank Kass were preparing to move Gradel to the site, but Heidtman subleased much of the land to Wagner. That left city officials scrambling to find another site for Gradel, eventually returning to the port authority land to work out a deal with Heidtman and Wagner officials.
The Gradel relocation is not final. The city still must negotiate to get about an acre of land in an adjoining property controlled by Sylvania businessman Richard Stansley, Jr.
Despite the major vote, the 13-member board barely had a quorum to conduct the meeting. Seven members attended in person. Three members, vacationing in Florida, participated by way of conference call, including board chairman Jim White.
By law, members cannot vote over the phone.
Board member Jerry Chabler said he was “extremely disappointed” Mr. White did not attend a meeting involving “one of the most important economic development projects” in agency history.
Mr. White could not be reached for comment last night. He had interrupted a vacation with grandchildren earlier this week to fly back to Toledo to negotiate part of the deal. He returned to Florida Wednesday.