The Union County Port Authority sealed its first deal Jan. 24, voting to authorize the issuance and sale of up to $4.85 million worth of bonds to finance construction of a natural-gas pipeline in the villages of West Mansfield and Rushylvania.

The Union County Port Authority sealed its first deal Jan. 24, voting to authorize the issuance and sale of up to $4.85 million worth of bonds to finance construction of a natural-gas pipeline in the villages of West Mansfield and Rushylvania.

In a second vote, the port authority authorized its executive director, Eric Phillips, to enter into an agreement with the All American Energy Cooperative Association for the design and construction of the natural gas distribution system.

"We formed the port authority in 2008, just when the economy went into the tank," Phillips said. "So it's taken us a while to get up and running. It's exciting to have our first deal under our belts."

Port authorities were created to operate maritime, lake and river ports as well as airports. But over time, the legal power of port authorities in Ohio has grown to include economic development.

Under the Ohio Revised Code, port authorities are given powers in the areas of real estate development, financing and the management of foreign trade zones. They can also issue low-interest, tax-exempt bonds on behalf of a private entity for the construction of new facilities or equipment.

If all goes as planned, the local deal should benefit all parties: All American will be able to finance the building of its natural gas pipeline at an interest rate lower than it could have secured anywhere else; the port authority will realize close to $30,000 in profits from its bonds; and the residents of West Mansfield and Rushylvania will save up to 40 percent off their energy bills by switching from heating oil to natural gas.

"It's exciting to be a player in the game," port authority chair Rick Shortell said. "We're just one more tool that the county has to encourage economic development."

Though the project is located primarily in Logan County, All American does plan to run its gas line to two grain dryers in Union County, with the option of providing gas service to even more of the county in a second phase of the project, if it proves economically feasible.

Phillips said it is too early to tell what the port authority will do with its $30,000 after it pays its administrative costs.

"We have several options for the money," he said. "Port authorities are allowed to own real estate. Theoretically, we could build or purchase a building and then lease it out to a start-up company to help spur economic development and bring jobs to Union County."

The port authority has special powers granted in the ORC to, for instance, "construct buildings without paying prevailing wage, which would be a huge cost savings," Phillips said.

Shortell said the port authority is learning as it goes along.

"Right now, we're just making sure we're dotting all of our i's and crossing all of our t's," he said. "We've hired the law firm of Bricker and Eckler to see us through the technical aspects of the bond issuance. Now that we're up and running, we'll be self-sustaining moving forward."