Anytime that news is dumped out on Friday afternoon, it’s not going to be good news.
We called US Green Energy a Job Bust a long time ago…
This company got $1,600,000 in Free Money from the Tobacco Commission back in 2010 and promised well over 300 jobs. Nothing happened in the first year, but the company said it’s going to happen very soon. Nothing happened the next year, but the company said it’s going to happen very soon. Nothing happened in the year after that, but the company said it’s going to happen very soon. See the pattern here?
Time’s Up! That buzzer that you heard was the end of the Free Money period from the Tobacco Commission. US Green Energy didn’t beat the clock, the clock beat them. Badly. Like the Harlem Globetrotters beat the Washington Generals. Like the chances of a non-country concert in the Harvest Jubilee concert series. Like Thomas Motley in a Danville City Council election. Yeah, that bad.
Here’s the city’s press release that was tossed out Friday afternoon… Danville negotiates grant repayment for U.S. Green Energy.
Here’s the Register & Bee story on it… Danville negotiates grant repayment for U.S. Green Energy. (Yes, it’s the same headline as the city’s press release. It was Friday, so I’m not going to mention how lazy-ass that was.)
If you’re a faithful reader of SouthsideCentral, you’re probably ready for me to disembowel this entire thing. I’m not going to let you down. Bring on the Big Board.
- City Manager Joe King says ““Officials from U.S. Green Energy have assured us that the company will cover the full $1.6 million grant in the scheduled four-year period.” – They also told the city, the Tobacco Commission, and everybody else that they were good for $30 million and 372 jobs. Jeremy Stratton believed them enough to vouch for them and we know all of his economic development deals have succeeded. Isn’t that right, Mr. Chervik? (Let’s see who gets that Caddyshack reference)
- “Company officials expect to receive a second cash infusion from overseas investors.” Yes. I expect to have the winning Powerball ticket as well. I’m pretty sure that this “second cash infusion” will never happen.
- “They say international money lending regulations have kept the cash languishing in an overseas bank while the transfer goes through multiple reviews.” Riiiiiight. If this Mystery Cash was real, I could have sent it by Western Union $1000 at a time since 2010.
- An officer of the company bought the building, leased the building back to the company and used the cash proceeds to pay the first of four $400K payments. Remember this next year when the second $400K payment is due, because I’m betting it won’t be paid by US Green Energy.
- This is the company that was in front of City Council less than two weeks ago complaining about their $450 electric bill. If their electric bill is $450 with nothing going on there, imagine what it would be with real production going on. They’ll need a lot of this Mystery Cash to pay that bill. It’s not like they have any solar energy panels to use for electricity there.
- Joe King: “The majority of small businesses fail within the first five years. It’s not unusual to have a new start up company experience some tough times getting fully functional.” – Wow. This is some really good spin because the majority of small business don’t get a million dollars of Free Money that’s guaranteed by the City of Danville (Brad Mainland and Web Parts not included). This is the same type of “Everything’s Going To Be Fine” talk we got a few months ago about the death spiral of the GOK Chinese furniture company. It’s horsecrap.
The city wants you to believe that the taxpayers aren’t going to be on the hook for the rest of the Tobacco Commission money. That’s understandable because they don’t want to feel the sting of the public outrage. The city also doesn’t want to publicize the fact that the Jeremy Stratton-led era of economic development has been a string of Job Busts and that more situations like that are going to be coming up. When Ecomnets turned out to be a Job Bust, at least they had the money to repay the Free Money that they got. US Green Energy doesn’t and they’re probably not ever going to.
This is a Job Bust disaster that’s been all wrapped up in pretty paper with a sweet bow on top. Inside the package, we’re going to find out that this is not anywhere close to what the city is trying to make you think it is. The city is now trusting a company that’s already broken every promise. It’s just not going to work out and the taxpayers are going to end up paying for this Job Bust.
Let’s all remember this article when it comes time to make Payment #2 on this bill.
I’m pretty outraged that the City, not U.S. Green, has to repay the Tobacco Commission. In my opinion, the money was given to U.S. Green, they are the ones who failed and they are the ones who should have to repay the commission. But we all know how this is going to go, Danville tax-payer screwed once again by incompetence downtown. Honestly, the tobacco money would have done more good if it had simply been divided up and given to the people to spend as they saw fit. What has Danville got to show for the millions that have been given away? Not much.
I talked with Danny Marshall about this. He explained that the city comes to the Tobacco Commission to apply for money on behalf of the business. This is the city’s fault (and this is all starting to fall on Jeremy Stratton) for backing a losing prospect.
And the low chance that US Green Energy will ever make payments 2, 3 and 4 is why I wrote this article. The city is pushing the idea that everything is OK (just like they did with GOK) and nobody else has what it takes to call horsecrap on that.
(and yes I know that U.S. Green Energy is supposed to repay Danville for it, but who believes that will ever happen?
Okay, so according to Joe King, this means that next year (Our 5th year in business in the VA and FL markets) we can also receive a grant from the city? Am I understanding his methodology correctly?
Barbara and I said early on they would take the money and run. The money ran out and they ran. You are right, Danville won’t receive any payments from US Green Energy.
Lets see how long it takes for that wheel manufacturing company to tank also……
I’m hoping somebody links up this $1.2 million in corporate welfare to the increase in the electric bills, personally. That could go fun places.
I don’t see much of a connection.
They’re just connected by time being in the news. I’m not saying it would be legitimate, just entertaining.
When is someone’s head going to roll? Seriously…..do we even live in a democracy any longer? Is there anyone in the entire City government that’s been held accountable? You’re going to tell me that we’ve seen job bust after job bust with public money for years, and not a single employee has lost his or her job? Councilmembers keep getting re-elected? It’s ridiculous. One or two? Maybe. But what’s happened in the past few years is indefensible. Find another city in America with this many public money-enhanced jobs busts in such a short period of time…..Danville exercises no accountability. None.
The opposite, in fact. This is all pointing to Jeremy Stratton and he’s already quit. There’s nobody else to point the finger at
Economic Development has got to stop chasing these pipe-dreams and go after companies which actually are in business and which can provide the jobs they promise. They might also try looking at companies which will need the labor force which is already here instead of all these high-tech jobs that few here are qualified for.
There aren’t many industries in this nation that need low skill workers. That’s the hard truth. Fix the education level of the population here, and things will start to look better.
BINGO
Or better yet, how about Southside and the IDA start lending money to CURRENTLY ESTABLISHED companies that are CURRENTLY in Southside, that are financially sound and GROWING. Help fund the expansion of local growing businesses that employ LOCAL people and are looking to employ MORE LOCAL PEOPLE.
Not rocket science…or so you would think….
[…] We’re a Job Bust. Trust us. […]
Speaking of the lackeys in Economic Development, does anyone know how much Linwood Wright is getting paid as a “consultant”? Big bucks I suspect. He is a plant by the “boys at the bank” to gear development their way.
I wonder how the employees that had checks bounce feel when they see talk of millions of dollars in the paper. When you bounce an employee’s check, that is a big deal.
[…] you Danville taxpayers liked paying back US Green Energy’s Tobacco Commission grant money, you’re going to just love paying back […]
[…] GOK, Hybrid Vehicles & Macerata Wheels are Busts. Those links will tell you that WE CALLED IT! […]