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Steel center moving to Franklin County

June 29, 1998|By DON AINES

CHAMBERSBURG, Pa. - A Cleveland steel company that serves major manufacturers in Franklin County, Pa., is moving here to be closer to it customers.

The Pennsylvania Department of Community and Economic Development said Monday that Olympic Steel will build a service center at the Chambers-5 Business Park and has purchased a Fulton County, Pa., machining company.

Michael D. Siegal, chief executive officer of Olympic, said the company will spend $7.5 million on the 80,000-square-foot service center at an 11-acre site in the industrial park. The park is owned by the Chambersburg Area Development Corporation.

The company purchased JNT Precision Machining in McConnellsburg, Pa., but Siegal would not reveal the sale price. Founded in 1989 by Tom Neil, JNT processes parts for JLG Industries in McConnellsburg, Grove Worldwide in Shady Grove, Pa., and other manufacturers in the area, according to a company spokeswoman.

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Siegal said other area customers include Champion Road Machinery, already in the Chambers-5 Business Park, and Ingersoll Rand in Shippensburg, Pa.

The sale of the company was completed Friday, according to the spokeswoman.

The state's announcement said JNT has been a customer and supplier to Olympic Steel for the past four years. JNT's operations will be moved into the new plant and the 25 workers there will be offered jobs in the new facility, according to the announcement.

"What we're trying to do is get closer to the region and mitigate some of the transportation costs," Siegal said.

By moving JNT to the new service center, products from Olympic Steel can be delivered to the plant, receive additional machining and then be distributed to area customers.

The plant is expected to create 45 new jobs, according to Geoff McLaughlin, a spokesman for the department. He said state assistance for projects is based on employment benchmarks.

For Olympic Steel, the state is providing a $100,000 Opportunity Grant, $100,000 in Customized Job Training Funds and a $100,000 loan from the state's Infrastructure Development Program to build a rail spur to the plant.

Franklin County Area Development Corporation Executive Director L. Michael Ross said Olympic Steel is assessing wage rates in the Cumberland Valley and predicted the jobs generally will pay $10 to $14 an hour. Siegal said the range is accurate.

Ross said the company will break ground around Sept. 1 and should open in the spring of next year. He said the plant could eventually double in size.

The state's announcement said Olympic Steel is experienced in specialized processing and distribution of flat-rolled carbon and stainless steel and tubular steel products.

Established in 1954, Olympic Steel had gross sales of $605 million in 1997, Siegal said.

The company employs 45 people at a service center in Lester, Pa., and seven people at a sales office near Pittsburgh.

Chambersburg Area Development Corporation Executive Director David G. Sciamanna said about 135 acres of the 350-acre Chambers-5 Business Park remain undeveloped, although 55 of those acres are under contract and companies are negotiating for another 20 acres.

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