Published Wednesday, August 21, 2002
Herald Business Editor
Saying his character is under attack, Jim Winner said a suit filed against his company by the Mercer County Industrial Development Corp. is just one more way to needle him.
"It's the last shot, if you want to hurt me one more time this is the way to do it,'' Winner said. "When things become personal ... character means too much for me. I have to respond.''
He outlined his view of the legal dispute with the non-profit development group over his attempt to develop the former Westinghouse Electric Corp. plant in Sharon with reporters Tuesday afternoon at his downtown office.
Winner said he issued two checks Monday to the authority totaling more than $18,000. The payments bring the amount Winner said he has paid of the $44,000 the authority said he owes to $29,000, he said.
Winner said any expenses that have been documented by MCIDA are now paid and considers the bill paid in full.
He bristled over allegations that he's not a man who pays his bills.
"That's not my reputation,'' Winner said.
In June MCIDA filed suit against one of Winner's companies, Winner Development LLC, for more than $31,000. The authority said it's owed the money for unpaid fees involving development efforts for the Westinghouse site.
The first hearing in the case is set for Aug. 30 in Mercer County Common Pleas Court before Judge Thomas R. Dobson.
A dispute arose in February over back fees when Winner said he was dropping plans to secure a $7 million state grant through MCIDA to develop the mostly abandoned plant.
Prior to February MCIDA, which was overseeing the grant application, continually said Winner Development failed despite repeated requests to provide information -- such as detailed cost estimates and proof that other financing was in place to complete the project -- that was required to complete it.
MCIDA said it spent more than $44,000 on attorneys fees and administrative costs to complete the application and Winner still owed the agency more than $31,000.
Winner Development is now seeking to secure the grant through the city of Sharon. Initially the project was pegged at $77 million but has since been scaled back to $18 million.
Winner said MCIDA continually moved the goal line on its requests for information, causing him to become frustrated over the project. He also said the contract between his company and MCIDA caps fees from Winner Development.
The reason Winner said he opted not to go for the bigger project was due to economics. A large part of the project was adding a third line at Winner Steel, a galvanizing mill owned by Winner. When word spread last year the United States would probably be enacting tariffs on steel imports coupled with merger talks among major domestic steelmakers, Winner said that would have put the squeeze on his company.
"I wasn't willing to risk the two lines I had,'' Winner said.
From the outset MCIDA was "non-cooperative'' in the project, Winner said, noting a dispute arose almost from the start. In December 2000 the two parties clashed over whether prevailing wages should be paid for construction workers on the project. MCIDA said it had initially been told by the state prevailing wages must be paid on the project but later rescinded the order after contacting the state's Attorney General's Office.
MCIDA said it has received a letter from the state a few weeks ago saying that prevailing wages must be paid on
He also questioned a $500 bill submitted by MCIDA for cell phone use and said MCIDA previously returned an $11,000 check his company sent to the agency.
"I don't know what's caused differences here -- personalities possibly,'' Winner said.
For more than a year bad blood between Winner and Charles Bestwick, MCIDA's chairman, has been apparent. But in responding to Winner's latest comments Bestwick said he has no ill will against Winner.
"We didn't attack his character, we just said the bill wasn't paid,'' Bestwick said. "I didn't make this personal between Mr. Winner and me, he made it personal between him and me. This is a matter between Mr. Winner and MCIDA.''
MCIDA hasn't received nor has been notified by Winner of the forthcoming checks, Bestwick said.
"I just wonder why, given the circumstances, if he holds a press conference why didn't he notify us he was paying us this money,'' Bestwick said, adding filing the suit was a last resort.
"He's obligated to reimburse us to pay these expenses and he hasn't done it,'' Bestwick said.
As for the $500 cell phone bill Bestwick said it wasn't like those charges were racked up in one month.
"If you do it over a period of a year-and-a-half and are charged by individual calls it isn't hard to do,'' he said of the $500 figure.
Bestwick adamantly denied MCIDA piled on new demands from Winner for information.
"He was told at the outset what was needed. We did not change the demands, which weren't ours to begin with. They came from the state,'' Bestwick said. In all there were 21 conditions demanded by the state there were left unfulfilled by Winner, he added.
"I would like to see this resolved,'' Bestwick said. "I want to see the property used in the best possible way as a multi-tenant facility. How that's going to happen I'm not sure.''
He deferred questions about how any new incoming funds from Winner would affect MCIDA's suit to its solicitor Tom Kuster, who said that remains to be seen.
"It's up to the authority,'' Kuster said. "If he (Winner) is offering this as a compromise the authority has to decide whether to receive the balance.'' He added the reason MCIDA rejected a previous check submitted by Winner was that it was marked by the company as payment in full which the agency said wouldn't suffice.
The new payments by Winner poses an interesting legal issue. If MCIDA accepts the money it would put the remaining disputed amount below $20,000. The figure is significant because the maximum limit for arbitration cases in Mercer County is $20,000. Each county court in Pennsylvania sets a limit for arbitration cases heard in that county.
Arbitration is where two sides use an independent third party to settle civil disputes such as contract language.
Kuster said MCIDA objected to Winner Development's plan to have arbitration in which both sides could only present briefs to three attorneys and no evidence could be offered. The company wanted each side to pick an attorney with both of those attorneys selecting the third arbitrator.
But if the amount is under $20,000 the court could order arbitration under its supervision where evidence could be presented. That, said Kuster, opens up possibilities.
He doubted MCIDA would take up the dispute at a special meeting it previously set for this Friday. He said it would probably be too late to meet legal public-notification requirements.
Regardless of the outcome, Winner said he's going ahead with the development project which he hopes will create 500 to 1,000 jobs when housed by tenants.
"The legacy I want to leave beyond any other is to create good employment, improve the quality of life and build on our tourism,'' Winner said.