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Connersville progresses on Carbon Motors deal

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Connersville Mayor Leonard Urban says the city soon will clear legal and environmental hurdles that stand in the way of Carbon Motors’ launching its operations there.

Urban said recently that the city hopes to contract with a firm that would assume liability for pollution on the former Visteon plant, where Carbon Motors wants to make its high-tech police cars.

Although Atlanta-based Carbon Motors chose Connersville, it can’t yet make use of the 1.8-million-square-foot factory vacated by Michigan-based Visteon in late 2007. Connersville wants to acquire the property and flip it to Carbon Motors for a low price or at no cost.

If all the pieces fall into place, the startup company could employ 1,550 people in three years. Connersville is counting on Carbon Motors to help pull Fayette County’s unemployment rate out of double digits.

The process is complicated by the fact that Visteon, an auto-parts maker, is in bankruptcy.

Carbon Motors spokesman Stacy Dean Stephens said the company won't announce a timeline for the start of manufacturing until the legal and environmental questions are resolved.

Urban said the city has identified an environmental liability transfer firm in St. Louis, but needs approval from state agencies. He declined to discuss the deal in further detail.

Connersville, or possibly the state, would pay a fee to transfer the liability. That fee could be close to the estimated cost of cleaning up the Visteon site.

The Indiana Department of Environmental Management has estimated a maximum cleanup cost of $4 million, a spokesman said. The cleanup work has already started.

Parties that want to buy contaminated sites contract with liability transfer firms in order to shed the unknown risks and cleanup costs. The firms assume liability in exchange for a fee. Liability transfer firms profit if they keep cleanup costs under the price of the contract.

The legal and environmental issues surrounding the Visteon site also stand between Carbon Motors and state tax breaks. In July, the company announced its plan to move to Connersville, even though it hadn’t struck a deal with the Indiana Economic Development Corp.

IEDC spokeswoman Blair West said the agency would have no comment on its talks with Carbon Motors.

Choosing a manufacturing site is a chief requirement for a federal loan. Carbon Motors is seeking $310 million from the Department of Energy's Advanced Technology Vehicle Manufacturing Incentive program.

Stephens, a co-founder and sales development manager, suggested Carbon Motors is confident about opening the plant. Asked whether the company’s plans hinge on getting the federal loan, he said, “I've already relocated my family and have a home in Connersville, if that tells you anything.”

Urban is taking Stephens' move as a positive sign. “As far as we're concerned, we're on a go.”

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