COLUMBIANA - The city and others owed money from the Firestone Farms housing development will finally receive those funds now that the foreclosed property has been purchased.
On Tuesday, Firestone Homestead LLC purchased the property for $4.9 million, two-thirds of its appraised value of $7.3 million. The property was in sheriff's sale at the county courthouse and local attorney Ted Thornton was the lone bidder. Thornton represents the company that county Treasurer Nick Barborak said recently purchased the note held by PNC Bank.
The note was taken out by Meadowbrooke Development LLC, which had purchased the property years ago with the intent to construct housing developments there. The company later defaulted on the note, and the property located along state Route 14 in both Fairfield and Unity townships was foreclosed in 2009. The bank was seeking about $8 million it was owed in mortgages.
Since 2009 the city has been paying back a $7 million 20-year obligation bond it took out eight years ago to pay for sewer lines to the development. The company was supposed to pay the city back from the sale of houses there but failed to do so after going bankrupt.
The city has been paying about $400,000 annually the last three years on the bond using reserves from its sewer fund. Now that the property has been purchased the bond will be paid back in the form of a special assessment.
Delinquent taxes and special assessments owed amount to $2,138,007, Barborak said.
The money will be distributed to the county treasurer, Columbiana city, Columbiana school district and Fairfield Township. The school district is owed 70 percent of delinquent property taxes and penalties.
Barborak said the office should have the money within the next two weeks and it will then be distributed appropriately.
The sale of the 62 parcels of mostly undeveloped property proceeded as a private property foreclosure, with the parcels offered as one tract of land. Barborak had filed a cross suit for the delinquent taxes and assessments in 2010.
Barborak said he doesn't know what Firestone Homestead plans to do with the property, but he hopes it will be developed.
"I don't know their specific plans. I assume they want to develop it. I hope they want to develop it. We hope they will make good use of the property and pay the taxes when they become due," he said.
The company is reportedly under new ownership but Thornton did not wish to provide any details, including the name of the company's owner.
He also did not wish to comment on what the company intends to do with the property, which was bid for $4.9 million.
The company had to put more than $400,000 down on the purchase Tuesday.
Columbiana City Manager Keith Chamberlin and Municipal Attorney Dan Blasdell attended the sale and spoke briefly with Thornton but did not wish to comment on the matter.