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February 13, 2013

Airport trade zone talks become heated

JOHNSTOWN — An intense discussion over the possible cost of creating a foreign trade zone featured Johnstown airport leaders facing off with one of their own Wednesday.

The trade zone proposal taps into federal programs that encourage foreign businesses to invest in the United States by providing tax breaks and other incentives in a designated location.

Several members of the Johnstown-Cambria County Airport Authority said they felt rushed to enter into a long-term contract with economic development consultant and attorney José E. Latour of Miami.

But authority member and County Commissioner Douglas Lengenfelder countered that the agreement must be in place when he and Latour travel to Argentina to make important business and government contacts.

The two, along with several other business leaders, are scheduled to leave today.

“Going down to Argentina, these guys are giving us one shot,” Lengenfelder said. “What I don’t want to do is go down there with a bunch of ‘maybes.’ I am not sure anymore who is the spokesman.”

The authority supports the concept, Chairman James Loncella and board member William Polacek said. Both are chief executive officers for large companies.

“The board is completely behind the foreign trade zone,” Polacek said. “We have never hesitated. We made this a strategic objective.”

But Polacek said he is not ready to commit the authority to the contract presented to members on Friday.

“The last thing I want to see is sitting here, approving a contract and get billed every month, and all of a sudden we start questioning what we are getting,” Polacek said. “I want to go into this eyes wide open and be able to say we took a chance and did everything we could to make this a success.”

Authority solicitor Timothy Leventry shared his own concerns with authority members in a four-page response to the contract.

Although Leventry was not able to attend Wednesday’s meeting, his law partner Randall Rodkey said Leventry also supports the concept.

“He told me, ‘I believe this is a great idea, but this (proposed contract) has taken everybody by surprise,’ ” Rodkey said.

“I have concerns as a business manager,” Loncella said. “I have concerns about committing the county to money in subsequent years.”

Board members shared their concerns with Latour, who said he would accept an interim agreement that would clear the way for today’s Argentina trip, Loncella said.

“It was a dilemma,” Loncella said. “I didn’t want the board to impede the development of the foreign trade zone. When we talked to José, I said I didn’t want to chase him away from the project.”

Board members offered to cover Latour’s costs for the trip and provide additional funding. Any money spent would be deducted from a $30,000 retainer included in the contract, if it is ultimately approved.

“We asked, ‘Is this going to hurt the trip? You need to tell us,’ ” Polacek said. “His exact words were: ‘No, this is not a problem.’ ”

Lengenfelder countered that the Argentinian businesses and government officials would be contacts he developed while serving there in the Air Force as U.S. air attaché to the South American nation. He has to be able to assure them he represents a legitimate project.

“Twice I’ve proceeded with what I thought was support of this board and I have been hit with something that is different,” Lengenfelder said. “The real issue is who is the spokesman and what can I negotiate when I get down there? That is no more guaranteed.”

“You are the spokesman,” board members Polacek and Ed Cernic Sr. replied, almost in unison.

“Tell us what you need,” Polacek said.

With a unanimous vote, the authority approved an agreement to pay Latour to travel with Lengenfelder and then develop a feasibility study on the creation of a foreign trade zone. Maximum cost is $13,272.44.

“I am pleased we were able to come out of here with a unanimous approval,” Lengenfelder said.

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