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City already missing utility

April 23, 2004|By DAVID DISHNEAU

HAGERSTOWN - Hagerstown already is missing Allegheny Energy Inc.

The utility company won't finish moving its headquarters to Greensburg, Pa., until September, but its Western Maryland hometown has felt the company's economic impact dwindle during two years of financial turmoil.

Until 2002, Allegheny was a big sponsor of cultural events and community activities in this Washington County city of 37,000. The company supported the Maryland Symphony Orchestra and the Western Maryland Blues Fest, among others, and it encouraged executives to serve on civic boards.

But Allegheny ended most of its sponsorships and moved many of its top executives out of Hagerstown long before Wednesday's relocation announcement.

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Local officials expressed little surprised at the news and said on Thursday they expect a potential buyer of Allegheny's 38-year-old office building and adjacent 450-acre business park to tour the property next week.

"I guess their leaving is sort of bittersweet," Mayor William M. Breichner said. He said Allegheny had been a good corporate citizen but he views the move as an essential part of the company's recovery plan.

Allegheny's departure will take away a bit of the community's shine, said Gregory I. Snook, president of the Board of County Commissioners.

"We always liked to mention we had a Fortune 500 company in our community. Now, we'll have to work on getting another one," he said.

Allegheny fell from the list of America's 500 largest corporations in March after reporting revenue of $2.47 billion, down 17 percent from 2002. It lost $355 million last year after veering near bankruptcy due to an ill-fated plunge into energy trading in 2001.

The company shed 600 jobs in 2002. Last fall, after a change in management, it started moving some of the 92 workers at its Hagerstown headquarters to a company-owned building in Greensburg, including most of the finance and accounting people.

By Wednesday, only about 50 workers remained at the corporate headquarters. Allegheny said 20 will be moved this summer to a company office in nearby Williamsport, 15 will be laid off, 14 will go to Pennsylvania and one job will be moved to Martinsburg, W.Va.

Allegheny Energy moved its headquarters in 1996 from New York to the building just south of Hagerstown that formerly housed its Potomac Edison subsidiary.

Three years later, the State Highway Administration completed a $9.2 million interchange on Interstate 70, providing easy access to Allegheny's headquarters along Maryland Route 632 and the company's Friendship Technology Park.

"If they wouldn't have been there, that interchange wouldn't have gone there," Snook said. "That's a big impact to the county because it opened up all that land to business development there."

The park's only occupant is Mountainside Teleport Corp., an Intelsat Ltd. subsidiary that established operations there in 2003. The company got a $600,000 state loan that would convert to a grant if it creates 60 jobs by the end of next year and 100 by the end of 2008.

Allegheny's stock rose 27 cents to $14.59 a share Thursday.

The company supplies electricity and natural gas to about 4 million people in Maryland, Ohio, Pennsylvania, Virginia and West Virginia.

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