Neighbors in the near north side and Averyville area are wary of Item No. 3 on tonight’s City Council agenda.
The item itself is fairly innocuous. O’Brien Steel wants the City to vacate the alley behind their Adams St. property. O’Brien owns the property on both sides of the alley. They’ve cleared recently-acquired adjacent property and are leveling the land.
What concerns neighbors is this: “This vacation is the first step in the proposed O’Brien expansion.” Neighbors are asking, “what expansion?”
Despite this council communication stating that there is a “proposed” expansion, when you ask the City for information about that expansion, they say they’ve received no proposal.
Susan Schlupp in the City’s Economic Development Department says her department has not received any expansion plan from O’Brien Steel. Pat Landes, Director of Planning and Growth, said in response to neighborhood inquiries that her department “does not have any application for rezoning, special use, or zoning certificate on file. At a meeting in September, O’Brien representatives said that when a plan was ready and they were ready to file that they would meet with the neighbors.”
Neighbors are wary of such promises. After all, the last redevelopment agreement with O’Brien Steel (June 2000) was made public on a Wednesday and passed by the City Council the following Tuesday. Neighborhood associations asked the City to defer the item to give them time to meet and give input to the plan, but the Council feared a deferral would scuttle the project.
Incidentally, the last redevelopment project promised to “increase the number of local job opportunities from the existing 150 to over 200 when the project is complete.” But in March 2009, the Journal Star reported that “32 of [O’Brien Steel’s] production workers were laid off indefinitely. Company president J.P. O’Brien said the company employs 120, most of whom are production workers.” It would appear that the promised additional jobs either never materialized or were short-lived. In any case, O’Brien now has significantly fewer employees than before their last expansion.
Despite all the protestations from the City that no proposal has been made, a June 22, 2010, statement from Speer Financial selling City of Peoria general obligation bonds had this to say: “[O’Brien Steel] is currently in negotiations with the City of construct a new manufacturing facility and warehouse that is estimated to cost $15,000,000.”
But the City doesn’t know anything.
But in March 2009, the Journal Star reported that “32 of [O’Brien Steel’s] production workers were laid off indefinitely.
It’s called a “recession” – a business cycle contraction, a general slowdown in economic activity over a period of time
That’s why O’Brien’s plans are 6-12 months away. He’s waiting until an upturn in business justifies capacity expansion.
Finally, the City of Peoria has been clueless for a long time. No surprise 🙂
David — If they have 120 workers after 32 workers are laid off, that means they had 152 workers before layoffs. But they had 150 workers in 2000, and the number of jobs was supposed to go up to 200. That’s the gap I’m talking about.
CJ – It’s sad if companies have to justify expansion to city councils on the basis of job growth alone. But they probably think they have to. Sometimes, they just need more room.
As I recall, O’Brien’s expansion plans from back in 2000 included a steel plate processing facility. Like any business, O’Brien has multiple clients. They will gain and lose some over time. It’s like a birthrate vs. deathrate scenario. Sometimes you come out ahead, and sometimes you don’t. O’Brien’s prediction of increased employment was based on retention of then-existing (2000) business plus anticipated growth.
Obviously, they either lost business or new business did not materialize as anticipated. It happens. But do we know that employment didn’t top out at 200 sometime after their steel plate processing plant opened about 2002?
Hopefully, an improving local economy will lead to job growth at O’Brien Steel Service. The latest expansion could have something to do with their recent (2008) acquisition of Rohn Products, and subsequent relocation of that company’s manufacturing operations to the former Bemis plant on Sloan St.
It is the same everywhere… expand, expand, lay off, lay off, and expand some more… get the bottom line nice and black those stock prices up…
(1) Is O’Brien Steel acquiring any additional land, other than the alley they’re asking the City to vacate (because O’Brien owns both sides of the alley anyway)?
(2) Will the land remain the same land use (heavy manufacturing)?
If the answer to (1) is no and (2) is yes, the zoning department probably wouldn’t have anything on file for an expansion like that anyway. There’s no new land that would need to be rezoned if they aren’t expanding beyond their current property and the land O’Brien currently owns wouldn’t change uses.
David P. Jordan is correct in implying that the jobs issue is a bit of a red herring here. In 2000, no one anticipated this recent recession; furthermore, I’m not an industry insider, so I don’t know if more efficient methods of production have come about in the past decade that would increase automation and require less production workers. O’Brien has not mentioned that any expansion would have any impact on local jobs yet, either positive or negative.
Furthermore, in your own source that you cite from Speer Financial, right above the quote you pulled regarding the negotiations with the city, it says that “O’Brien Steel currently employs 160”, which means that the last expansion did have some job growth if pre-expansion employment was at 150.
The City wouldn’t get involved until O’Brien finalizes their plans, gets funding in place, and goes to the City for a building permit. Even if the city is in “negotiations”, that doesn’t necessarily mean that there’s a plan in place yet. Look at how East Peoria handled the Bass Pro situation — they didn’t announce the plans until the project was shovel-ready.
We complain all the time about jobs leaving Peoria and here’s a business looking to reinvest in and expand their Peoria business (and in an area like Averyville and not Grand Prairie, no less) and we think they must be up to something shady?
Time to spin the wheel! How much taxpayer money will the City Council give O’Brien Steel?
It’s coming. Wait and see.
Charlie: O’Brien Steel is not a public corporation and its stock is not available to the public, so why do you worry abut their stock price? It only affects the very few stockholders (owners) and can’t be traded. They are a good company, run by good people-don’t chase them out of Peoria like so many business’s have been.
Wacho said: Charlie: O’Brien Steel is not a public corporation and its stock is not available to the public, so why do you worry abut their stock price? It only affects the very few stockholders (owners) and can’t be traded.
Deatails, details! Who cares about facts?
What businesses have been “chased out of Peoria”?
What businesses have been “chased out of Peoria”?
(1) Elecsys wanted the old Builder’s Square but the City rejected rezoning due to “traffic concerns.” Elecsys went to Pekin.
(2) Pioneer Industrial Railway. Evicted in August 2005. Returned in January 2008 by STB Order, but with insufficient business. No cooperation on economic development from City.
(3) WinPak left the old Fleming-Potter building for Pekin (like Elecsys) for expansion. Did they try to lure them to Growth Cell Two? I doubt it.
(4) Amerhart Ltd. moved to Pekin. Did Peoria make an effort to lure them to Growth Cell Two? I doubt it.
To be fair, Drumheller Bag Corp. moved into the old WinPak facility and Rohn Products, with little or no mention in the local media, moved into the old Bemis plant.
(1) Good example. That was in 2001.
(2) Yes, although the parent company is still in Peoria, I believe. Isn’t it still out by CEFCU on Dirksen Parkway?
(3) and (4) Failure to try to keep business here is not good, but it’s different than chasing business away.
The City of Peoria has never intentionally chased out a business, but attitudes, regulations, taxes, etc. make Tazewell County look a lot better. And it makes you wonder if Peoria even cares. As long as we get a riverfront museum, a new downtown hotel, medical facility expansion and tech firms, who cares about traditional employers?
A decade ago, UniSource and Pepsi-Cola left for greener pastures in Morton. Though Peoria didn’t chase them out, they likely didn’t make much of an effort, if at all, to retain them. Growth Cell Two would have been a good location.
Chased out of Peoria? The motherload–the Riverboat
It was my understanding that Jumer tried to build his casino here first, but found Rock Island much friendlier for business.
This blog is indicative of the malaise that is affecting much of the US right now. Suspicion, avarice, an upside down politically appointed structure in charge of critical services, sniping against employers, you name it, we’ve got it.
I saw a city planning map for Peoria about five years ago but it was slanted to the riverfront green spaces rather than the needs of the city… and cost the city a pretty big fee for pretty pictures so we could look like Louisville. I wanted to develop commercial buildings, but I’m settling for keeping my family safe from a couple of unethical lawyers down in Carbondale. I may never get the chance to build or plan a development, but along the way to earning my MS in Urban Planning, I learned a great deal about various functions of city planning…. what makes a plan good and what makes a plan just a toy. Peoria paid for a toy dressed up in pretty colors painted by an engineering firm from EAST PEORIA. It seems that we can’t do it in Peoria, but if they are from elsewhere, we have a checkbook.
But what I see is that the city IS changing, some for the worse, some is just age, and some is good… like our streets are generally getting better this year. Perhaps that is just the Federal stimulus money applied to our many US routes, but it is good…. thanks to Obama’s Peorian Transportation Secretary!
We need to fix a few things… Peoria cannot spend money and NOT have an accounting for the results. Reading above and the offchutes give many examples of failed projects with no review of why they failed nor of how to do it better or prevent failure… much less a complete list of failed projects this city government has signed us up for along with a talley of the total cost. So much of our economic development time and money seems to have been swept under the rug- as failures often are. Yet they are still out there plugging bond issues and museums and hotels that will cost us but not bring us a nickel if the earnings projections are correct. We are simultaneously in a recession and big budget crunch with two major projects ready to bite our income when we need it most due to reduced income. This is seriously wrong because we are considering the superfluous when we are planning to lay off firemen and police. Nobody seems to be able to say NO to a Caterpillar demand that Peoria fund a Caterpillar museum. The answer should be … LATER. NOT NOW. People like Mayor Ardis are functioning in a political fashion without legal representation nor advice. At least the city manager has seen fit to correct that within the city employee list. But when will this flailing stop? Gary sees it as it is. So does Mr. Widmer.
We are busy seeding TIF areas (which steal from our school funding) that service Dunlap for jobs and shopping while we sneak through downtown and southtown trying to avoid the gunfights caused by a poor population that has given up on their future. We are sneaking video equipment into odd budgets to try to at least catch the perps after the fact and put them away. Our people are NOT safe in their homes, our streets are NOT either. We pile failed project upon failed project with NO accounting when they go bad… and you only need to read the above passages to see that the list is large and growing. Nobody has their eye on the prize. We give our money away to expensive PRIVATE projects with budgets we can already see are inappropriate to paying us back or even making it a worthwhile project for the needs of the city. Is there NOBODY capable of getting this financial mess under control? City Council sees it as too expensive so they lop off the most pleasing of the project’s eye candy… but they continue to ignore the projections versus the facts that will lead to the payback going bankrupt. We need someone in control, not a mayor whose major contribution to headlines is a felony political use of his letterhead, and a total failure to see that his leadership is really a bunch of sound bites dedicated to leaving a history… that we can all see is leading us down the path to another destructive private funding with public money we can ill afford to see go belly up.
When will the city fathers see that we need an improved educational thrust possible with city involvement that will enrich the ambitions of our population and give District 150 kids now on the street the impetus they need to buckle down… knowing that they CAN get jobs. We need to develop an educational think tank of local and corporate technical sponsors with the Greater Peoria Area in mind. Run by a financial manager, guided by a technical person, taught by education specialists, we need a plan to teach the teachers how to prepare our students for jobs in the automated world. And we need to reinvent the RiverTech educational program to do it. IBM can sell its hardware, Microsoft can sell its software, but Peoria must educate its children to understand the future of computing and to understand the financial and economic needs of their neighbors and the businesses that support them. We have small business solutions, but they are costly and require inhouse salary anomalies. A better solution is to educate a group of Peoria high schoolers and junior college students in network setup, cloud computing, customization, software uses, etc so they will have skills to go further in their education and skills to support small businesses through network consultants/deployers. These are needs right now in Peoria. There are many classes at a college level that would have to be completed to go further, but each skill level can be an isolated step that can be taught to small groups at a high school level. These kids would be the first wave of technocrats Peoria produces… but we need more… in specific disciplines, like basic electricity, creation, installation and management of solar arrays; wind turbines, air flow and weather phenomena; insulation – green and not so green- and how to create an HVAC system appropriate for a particular house considering moisture sources, heat and cooling requirements, and insulation and encapsulation. We need to teach people the basics of home maintenance including thermostats, painting, surface preparations, carpentry, basic concrete work, repair or replace decision-making. We could use the students as workers under teachers well versed in home repair to work on Peoria homes in need of repair. Think about Peoria and think how much better it could look.
THINK ABOUT PEORIA AND HOW MUCH BETTER IT COULD FUNCTION IF WE HAD THE FORESIGHT TO CREATE A CADRE OF KIDS CAPABLE OF MAINTAINING WHAT WE ALREADY HAVE.
Then think about making an accounting of all these failed projects and produce a report on why each one failed and how it could have been averted or reduced in its negative impact. Until City Council gets the economic development plan under control, we face disaster. And MAYBE we should be looking at a Peoria TEA Party.
WACKO: “its stock is not available to the public, so why do you worry abut their stock price?”
Thank you for that admission. I wouldn’t have known otherwise.
Even more reason to be concerned about the division between owners and laborers. Labor can’t even participate in the profits… Or does Joe offer profit sharing with his employees?
Mr. Mayer… would you like to be Mr. Mayor? I would support you.
C. J.: two good examples-Dale Burkland’s company and the Waugh Co., both now in Tazewell County.
Me, too, Charlie–on the vote for Mayer.
As for OBrien Steel and its two alley separated properties, I suspect the third district representative KNOWS what kind of usage that alley gets… and he could have talked about it at the meeting last night… but nobody wanted to “WASTE” their time doing the job.
It is true that few towns will give up alleys unless they are in a residential district… and then it is done all the time. But for the city to deny giving up the alley is appropriate still has not been done. And no, I don’t like it when a company puts it in terms of a threat… but let’s face the issue. OBrien is more under the gun that the city is. It is OBrien that is landlocked and has a problem using both pieces of land they own because doing so puts them at risk…. and puts Peorians at risk of getting in their way. Now in a soft product industry that wouldn’t be much of a problem, but in the steel industry, I think you should consider closing off that alley just to protect the passerby who tried to navigate an area seldom traveled. AS one person suggested, that sewer section is relevant and it needs to be maintained, and access to Detweiler Marina is at issue too. But that is NOT done via an alley. If it were just an alley, then it should be reconnected at Spring Street and part of the Park land should be traversed if there is not enough “ALLEY” space west of the tracks. Right now it is a dead end space serving as an example of Peoria Beautiful…. and serving no purpose beyond a walking path… which need not be destroyed if we pave only enough to let boaters come through with in and out roadway. We only need to protect the walk path from bad drivers. A view of the marina comes at a price… behind its 8 foot fence.
And NO. It is Ms. Mayer. I won’t make time for political jobs. But I would like to see if we can get the educational program started. Louisville has a program where each summer a group of U/L students go out into the neighborhoods with a volunteer licensed plumber and carpenter with specific plans to correct a household problem… for 20 to 30 homes. In the span of a week the problems are fixed and the elderly or poor can benefit from a habitable home that was verging on the uninhabitable. There is a budget provided by several local organizations and the work done is supervised well. They even fix leaks in roofs and paint unmaintained wood structures. Anything is possible… but it means the owner can stay in his house longer… and it won’t need to be sundered. And you KNOW we have some really uniquely good homes badly in need of adequate plumbing or corrections to staircases or roof or settling issues that only need a little vision to correct before the house is too far gone.
But whatever… it is the way they do it in Louisville. It has not caught fire here even though I KNOW the planning department was made aware of the Louisville program. I guess we’re too “professional” to help our neighbors.
@JE Mayer – Don’t worry, it’ll catch fire here. Except I mean that more literally, as we’re laying off more firefighters.
Was this blog shut down?