Feds OK deal for Moroun company to buy, clean up McLouth Steel site

Mark Hicks
The Detroit News

The former McLouth Steel Corp. site moved closer to redevelopment as federal authorities on Thursday announced a deal allowing a company owned by billionaire Manuel "Matty" Moroun to buy most of the site from the Wayne County Land Bank.

The agreement includes the U.S. Environmental Protection Agency's proposal to add the parcel's entire 197-acre southern portion to the Superfund National Priorities List to address issues not covered by the settlement. The Superfund list includes the most serious uncontrolled or abandoned hazardous waste sites in the United States.

The old McLouth Steel site in Trenton is seen in this file photo from May 17, 2017.

Some of the long-dormant site was suspected to contain PCBs and potentially hazardous materials that could become airborne during the cleanup process. "Black lagoons" from runoff and sludge remain as a result of the mill activity, the EPA has said.

“Inclusion on the NPL will make work in the southern section eligible for federal funding,” the agency said in a statement.

Assistant County Executive Khalil Rahal lauded the developers and local, county, state and federal officials for completing the deal in about a year, faster than the typical 18-24 months.

"I think this is going to have an effect on the entire Downriver community," he said. "We’d love to see the site back to its glory days. I do think it’ll be an industrial development that will bring good-paying, middle-class jobs and will infuse the local economy there."

The deal calls for MSC Land Co. and Crown Enterprises, Moroun's real estate company, to buy 183 acres from the Wayne County Land Bank and clarifies the companies’ cleanup responsibilities, federal officials said. 

Among the cleanup requirements:
•Demolishing about 45 structures;
•Removing asbestos-containing material, containerized waste and materials containing PCBs from all structures prior to demolition;
•Installing a fence around the property;
•Removing contaminated water and sludge from 23 subsurface structures, such as pits, basements and lagoons
•Investigating five areas where PCBs may have been released
•Assessing and report on options for stormwater management to eliminate uncontrolled flow to the Trenton Channel of the Detroit River

Meanwhile, EPA is expected to continue to investigate and manage existing contamination on the property.

Officials with Crown were not available for comment Thursday night.

Rahal said the developers already have paid the nonrefundable $4 million for the property to cover the former owner's back taxes. Now with the EPA's approval, the sale of the land is expected to close in about a month.

The deal follows years of moves to restore the former facility near West Jefferson and Sibley that McLouth Steel operated until the 1990s after the company filed for bankruptcy.

Detroit Steel Co. bought and ran the property until it ceased operations, and local operators purchased the plant land.

In 2006, a proposal to turn the property into a residential-commercial site called the Bay Village of Trenton failed. A proposal to renovate the site for more than $200 million and produce steel again there also failed.

After Wayne County acquired the 183 acres of the 197-acre southern portion through tax foreclosure last year, the county entered into a purchase and development agreement with Crown Enterprises, the EPA said.  The remaining acres are still owned by DSC LLC.

The Wayne County Commission approved a proposal for Crown Enterprises to raze structures at the site within 24 months and invest $20 million on the property in six years while possibly building automotive manufacturing and logistics centers there.

Moroun has agreed to make an effort to use Wayne County businesses and residents to perform work at the site, and officials said 60 percent of the jobs would go to local residents.

Officials had sought public input on the settlement through last month.

The McLouth property is attractive because of the three international railways traversing it, the new Gordie Howe International Bridge planned nearby and 1,600 feet of waterfront dockage.

"The deal does not mean you will see buildings rise and jobs become available tomorrow," Rahal said. "But after two and a half decades, there's actually a bright future."

Staff Writer Breana Noble contributed