City Of Ontario Reacquires GM Site From Development Group

  • 9/20/2018 12:11:29 AM
  • Jesse Smith
  • Local News

ONTARIO, OH - After long discussions with the company that currently owns the former General Motors property, the City of Ontario has made a decision on what to do with the currently-vacant property that is situated in the middle of Ontario.

Ontario Mayor Randy Hutchinson addressed members of the public and City Council Wednesday night, announcing the city's decision to reacquire the property in hopes of continuing development and bringing in new business to the city.

"As everyone may recall, in June 2017, the City sent the owners of the former GM property - Ontario Business Park - a Notice of Default of Surety Guaranty under the Development Agreement," Hutchinson began. "In that Notice, the City alleged that Ontario Business Park was in default of the Agreement because it had not created the required 500 jobs on the site within the first 5-year term of that Agreement. As a consequence, the One Million Dollars that Ontario Business Park had placed into escrow securing the job creation obligation would be forfeited to the City. Upon receiving that Notice, representatives of Ontario Business Park appeared in a Council meeting and argued, among other issues, that the Notice was untimely and threatened legal action if the City pressed forward with the default."

Hutchinson then talked about the solution between the two entities, and what informed their decision to move forward.

"After over a year of negotiating with Ontario Business Park, the City is proud to announce that the City has agreed to a settlement in lieu of filing a lawsuit against the Ontario Business Park. To avoid a costly and lengthy litigation, Ontario Business Park has agreed to transfer all of the property to the City for the release to Ontario Business Park of the One Million Dollars ($1,000,000) being held in escrow and then a termination of the Agreement thereby releasing all liabilities under the Agreement. This means that Ontario Business Park will not receive any City funds for the transfer of the entire property to the City because the funds being released to Ontario Business Park were placed into escrow by Ontario Business Park."

"As was stated earlier, this process started in June 2017 when the City sent Ontario Business Park a Notice of Default of Surety Guaranty of the Development Agreement with the City. Shortly thereafter, Ontario Business Park threatened the City with a lawsuit, alleging that the Notice was untimely and in breach. Since that time, representatives from the City and Ontario Business Park have met numerous times trying to settle their differences."

The City considered every option available to it, including:

  • a lawsuit,
  • receiving portions of the property in exchange for a reduction of job creation requirements,
  • or a transfer to the City of the entire property.

"In the end, considering all factors, including the potential cost and time of litigation as well as the continued state of the property and the City's expectation that it would remain as such during any litigation, City Council felt it would be best to settle the dispute by receiving the entire property. The City would like to thank Ontario Business Park for this opportunity to reestablish this property as a foundation of the City. Because General Motors was a cornerstone of Ontario since its founding, we are excited about the potential for the property's renaissance. In conclusion, on behalf of the City Council, Administration, Service Departments, and Police Force, I would also like to thank the Citizens of the City of Ontario for their support and continued patience in this matter. It has been a long journey to get to this point. However, we are not done. Once transferred, the City will work hard to ensure the property is maintained and developed to the high standards set by the citizens of this great city so that the property is reestablished as a key foundation of this City."

The agreement will bring the many disputes between the Ontario Business Park and City Council members to a close. Council and personnel from the Ontario Business Park - which is partially owned and operated by the Adler Group - previously had heated discussions on the progress of development on the site. Adler Group representatives argued at the time that the Environmental Protection Agency had prevented the group from developing on the site until it was approved. The site, as it currently exists, is a barren lot, with several large water-filled craters where the former General Motors' basement used to be. While the city may be reacquiring the property with plans for the future, the site itself will have to undergo a dramatic transformation in order to be developed upon. 

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