CITY LOAN TO OEM FORGIVEN
Wednesday, October 14th, 2009 -- 8:43 AM
The Neillsville City Council forgave a $250,000 loan to a major manufacturer last night.OEM received two $250,000 grants from the city of Neillsville when they began their industrial park facility, which opened in April of 2007.
One of the grants came directly from the city and was used for site improvements; the other was funneled through the city from the Listeman Foundation and was to be used for start-up expenses.
Because of tax reasons, that grant was turned to a promissory note, with conditions attached; chiefly, OEM was to payback $2,500 for every job less than 100 created by September 30, 2009.
When operating at their peak, OEM had 122 employees, but they are now down to 57.
In a letter to the city, OEM?s Financial Officer explained they got off to a terrible start when equipment was late getting to the plant, they were forced to outsource some of that work, but it didn?t make deadlines. The result: customers dropped their accounts.
Then, the economy went south in a way no one could have expected.
OEM asked that the note be turned back to a grant and promised any future expansion of the company would take place at the Neillsville location, not their home-base in Woodville, Wisconsin.
After a brief discussion, the City Council voted unanimously to oblige and forgive the $250,000 loan.
In other Council news, the old feed mill property at the corner of 7th and Grand was sold to Gary Zschernitz for $2,100. The parcel was put out for bids. Zschernitz outbid Bob Struensee by $90.
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