Dana Tax Donations

Toledo, OH: (Sep-20-07) The Anthony Wayne Local School District filed charges against bankrupt auto supplier Dana Corp., over missing tax abatement donations. The suit stated that negotiations began in 2006 after Dana missed a third straight annual payment of about $237,000 to the school district. The bankrupt Toledo auto supplier had agreed to pay Anthony Wayne as part of property tax abatement for Dana's Maumee Technical Center that opened in 2004. Dana Corp., in its filing for Chapter 11 bankruptcy protection in US Bankruptcy Court in Manhattan, listed Anthony Wayne as one of its creditors. However, because of the circumstances of the original abatement agreement, Anthony Wayne's unsecured promise from Dana to donate $237,000 each year ranked it among the lowest of the entities standing in line to be paid by Dana.

District officials realized early on that fighting for funds with other Dana creditors could mean substantial legal costs with no promise that a payoff would materialize. Over the course of time, a change in state law and a change in the value of the building that was originally abated substantially impacted the amount of money the district was owed. The value of the property was halved from its original $30 million under an earlier separate agreement between Dana and its landlord, the Toledo-Lucas County Port Authority. In a settlement reached, Dana Corp. agreed to pay the Anthony Wayne Local School District $1.25 million. Final details of the settlement are being ironed out and must be approved by the bankruptcy judge overseeing Dana's case as well as the other creditors with claims on the company's assets. [TOLEDO BLADE: TAX DONATIONS]

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Published on Sep-22-07