Talks between a former Philips Lighting employee and the company about purchasing the now defunct Danville factory have fizzled, leaving local officials frustrated by the prospects for the vacant facility and the progress of environmental clean up efforts.
After months of negotiations, NeoStar Glass founder and CEO Anna Broughton is looking for other options for the fledgling operation she intended to start in the Vaksdahl Avenue plant that closed last year.
Despite what she still believes is a solid business model and the support of city, county and state officials, Broughton said things were going nowhere between the two sides. She said a company representative indicated recently there was another prospective buyer or buyers.
"I spent the last year-and-a-half trying to find a way to negotiate with them," Broughton said. "I made at least four offers, but they haven't really come to the table."
Broughton, who lives in Danville, spent 20 years in various jobs related to glass manufacturing. She was employed at different points by both Corning and Philips, where she was a melting quality manager and later a production manager.
NeoStar will be a specialty glass manufacturer, with products that will likely include pharmaceutical, architectural and solar energy applications. She had planned to initially make some lighting glass to supply Philips and hoped to bring back some of the workforce that was laid off.
The project was preliminarily approved for up to $5 million in state tax incentives contingent on the creation of 300 jobs over three years and was approved for a $2 million Community Development Block Grant.
Although Philips would have footed the bill, Broughton said she made handling what could be a massive cleaning process a part of one of her offers, along with the supply contract. She said her initial conversations with representatives of Philips corporate parent company in Eindhoven, Netherlands, were positive, but she now questions if Philips Lighting North America negotiated in good faith.
Broughton believes Philips never had any intention of selling. While she was discussing the possibility of a supply contract as part of the negotiations, she said the company was simultaneously working on a cheaper deal with a Chinese company.
Philips representatives declined to comment on the failure to reach a deal with Broughton or whether there is another buyer. The property is still listed on the website of international Real Estate company Jones Lang LaSalle for sale at an undisclosed price.
"Throughout negotiations with NeoStar, or with any other party interested in purchasing the property, we will be responsive, reasonable and flexible," Philips spokeswoman Amy Shanler said in an e-mail Friday. "As a member of the Danville community for nearly 30 years, we share the community’s goal of returning the property to productive operation as quickly as possible."
The negotiations apparently hinged on the cost of environmental remediation for a site with known lead and arsenic contamination, and a building that likely needs a lot of work before it can be occupied. According to Broughton, the two sides remained at an impasse over how much work Phillips would be responsible for.
Broughton said the company only intended to do the bare minimum required by law. Despite some ongoing enforcement activities, she said the state Department of Environmental Protection doesn't seem to be taking a hard enough line.
Environmental protection officials have said they do not believe concentrations of lead and arsenic found in soil samples pose an immediate threat to public health or safety. The company is being asked to continue monitoring and assessing contamination of the land, but the scope and cost of clean up has not been determined.
Broughton believes cleaning up the building itself and making it a safe working environment could be an even larger undertaking.
In addition to the residue that may be left from decades of glass making, Broughton said the thousands of windows in the 334,000 square foot structure would either have to be replaced or asbestos caulking around the windows would need to be removed. She said the cost was estimated at between $10-15 million.
Tim Hubbard, assistant director of the Department of Environmental Protection's Division of Waste Management, said much of the building will likely not be investigated. Anything — such as pumps or piping — connected to an outflow will be dealt with at a later time, Hubbard said. The structure itself would apparently come under more scrutiny if it sat vacant for an extended period of time.
Philips did not respond to questions about a timeline or price of environmental remediation, or whether the company is prepared to do any necessary work to clean up the building for a new tenant. Shanler said the company had been working to remediate "historical matters" inherited from previous owner Corning Glass Works and has continued to act responsibly with regard to environmental issues.
"In connection with our decision to close the factory, we took voluntary and proactive steps to identify all areas of environmental concern," Shanler wrote. "Following our review, a detailed site characterization report was submitted to the Kentucky Department for Environmental Protection (“KDEP”). We have been and will continue to work cooperatively with the KDEP to properly address all known site conditions."