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A proposed
lease-and-purchase agreement between the city of Wilmington and Total Baking
Solutions regarding a former Textron facility calls for $1 a year rent during
a lease term expiring on New Year’s Eve 2016, and a $1 million purchase price
afterward.
Total Baking Solutions
(TBS) of Roundup, Mont., officially announced on Feb. 28 it would establish
manufacturing operations in Wilmington at a former Textron plant on South
Nelson Avenue. TBS is a manufacturer of industrial-size ovens.
The premises to be leased
are all 113,000 square feet of building 2 of the former Textron facilities
which the city owns.
If TBS wishes, it can
accelerate the purchase option but a purchase cannot be made prior to the end
of the remediation period for the brownfield site, said Wilmington Mayor
David Raizk.
While discussing the
proposed agreement at Thursday’s city council meeting, Raizk revealed that
TBS was offered a plant for free in Michigan.
“We were able to work this
deal because our location was a little better and a couple other things that
were good,” the mayor said after the council session.
“There are tons of
industrial space all over this country that’s empty,” added Raizk.
The agreement says it is
TBS’ responsibility to pay the facility costs for insurance and utilities.
The bill for utilities
during the winter is about $20,000 per month, according to Raizk.
The oven company will be
responsible for the maintenance and repair of the premises.
Wilmington City Councilman
Rob Jaehnig said TBS already is engaged in roof repair, wall repair and
adding offices.
A jobs creation incentive
was built into the proposed agreement, where the purchase price would be
decreased for jobs creation.
The agreement says the
principal owed by the company will be reduced by $250,000 if, during the five
years preceding the maturity date of the note, TBS has employed on average no
fewer than 100 people at the Wilmington location on a full-time basis.
The note will mature five
years after the closing date. If TBS exercises the purchase option, it will
buy the property within 30 days following the New Year’s Eve 2016 expiration
of the lease term.
During public comment,
former city councilman Scott Kirchner asked questions focusing on whether the
city had written precautions within the agreement in the event TBS goes out
of business.
Stressing he hopes like
everyone else that TBS succeeds, Kirchner asked whether the city has required
TBS to take out bonding insurance that would make the city whole on the
actual value of the property during the lease term if TBS were to close.
Raizk said TBS cannot bond
what it does not own, and that the city cannot sell the building until the
end of the remediation period, including a time of monitoring and testing
after the actual cleanup.
History:
Year in Review
Sunbaked
Biscuits replaced
Alamogordo Daily News
By Michael Becker, Managing Editor
Posted: 01/01/2008 12:00:00 AM MST
One of the most contentious stories of 2007 was the implosion
of local cookie maker Sunbaked Biscuits. The company went belly up early in
the year and disappeared amidst a flurry of lawsuits…………. By mid-January of 2007, Sunbaked
closed its factory and informed its creditors it was seeking a buyer.
However, the company at first said production had halted due to a damaged
conveyor belt. The lawsuits quickly followed…………Sunbaked
and its owners, Dave and Chris Roberts, aren't out of
the woods yet. Three lawsuits against Sunbaked in District Court, brought by
Delta Systems, Plastic Packaging Technologies and Consolidated Electrical
Distributors, are still wending their way through the legal system.
Allegation: By a Michael
Morris
Some of you may remember the Roberts Family of Roundup, Montana that
scammed over $2 million from the taxpayers of Alamogordo [New Mexico] in the Sunbaked Biscuts
scheme. The Roberts are at it again in Wilmington, OH changing little more
than on their website.
Here the local paper [Wilmington News
Journal] explains the rock solid deal to get a former industrial building
owned by the city in a jobs deal to bake cookies.
Principal: Mr. Dave Roberts, Owner
Notes: Prior to the 8/1/11 signing date of
the City/TBS contract the administration was advised by a disgruntled family
member of the company owner’s family that alleged that all was not on the up
and up with the Company and that they had a bad track record. He cited the
history of the principals at other locations including New Mexico (see
above).
Some of you may remember the Roberts
Family of Roundup, Montana that scammed over $2 million from the taxpayers of
Alamogordo [New Mexico] in the
Sunbaked Biscuts scheme. The Roberts are at it again in Wilmington, OH changing
little more than on their website.
Here the local paper [Wilmington News
Journal] explains the rock solid deal to get a former industrial building
owned by the city in a jobs deal to bake cookies.
As of 6/1/13 the best estimates of observers
of the TBS facility is that fewer than 20 employees are working there. If the
estimate accurate TBS would have to average 160 employees over the next three
years in order to qualify for the $250,000 purchase credit. If, as it appears
likely, there will be no purchase the sewer fund that paid around $600,000
for the city’s portion of the original property purchase will receive a grand
total of $5.00 for the effort.
Comments from a presentation to Council at
the 1/3/13 meeting:
Paul Hunter – 200 Randolph Street – gave a presentation
regarding the TBS contract
with the city for their facility on Nelson Avenue, in the
wastewater building. He explained that the company pays a $1 per year rental
for the building that the sewer department contributed over a half million
dollars to purchase. He said the expectation in the five-year lease was the company
would employ 100 workers and the income tax receipts would make up for the
free use of the building. He said that he estimates that they only have
around 20 employees and are almost two years into the contract, which is much
lower than expected. He said that number of employees would generate about
$900,000 in annual wages or around $9000 in income tax to the city, which is
far short of the $550,000 that the sewer department has spent on that
property. He added that TBS can, at the end of the 5-year period, exercise an
option to purchase the building for $1 million or simply walk away and find
another distressed city to set up shop on a 5-year plan. He said it was his opinion that the city should be
talking to the company and attempting to modify the agreement or seek some
legal form assurance that TBS is committed to purchasing the property and/or increasing employment to the 100-jobs level
that they promised.
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