We look at the major business stories of last year
By Bob Warde and Sean Fitzgerald, Publisher
After a busy 2009, 2010 hasn’t disappointed. A plethora of activity had permeated the region as elections were held, some businesses expanded while others shut down, highway reconstruction got under way and new ways of generating energy were developed.
The past year features a much more mixed scene, with more positive developments than during the previous year. Some have the potential to be the bedrock on which a brighter future will rest. So now we bring you the ninth edition of what has made news, those topics discussed at the water fountain and office coffee pots, and issues that may have changed the business horizon forever. Here is our list of the Top Ten business stories in the B2B coverage area for 2010.
Highway 41 update moves into high gear
U.S. Highway 41 modernization picked up steam. Construction work on the U.S. 41 project will span more than 17 miles of highway in Winnebago County from 2009 to 2014, and 14 miles in Brown County from 2010 between 2017. The construction includes: traffic lanes expanded from four to six – and in some cases – 10 lanes; 16 interchanges improved, with 13 of those interchanges completely rebuilt; 44 roundabouts added; 17 traffic cameras installed along U.S. 41; and an eight-lane Lake Butte des Morts causeway.
In March, the Wisconsin Department of Transportation began work to demolish and replace the Witzel Avenue Bridge over U.S. 41 in Oshkosh. The overpass was closed to all traffic throughout the duration of the $8.3 million project, which reopened to traffic in October. Simultaneously, crews worked to replace the 20th Avenue overpass in Oshkosh, which opened to traffic in July. April brought work by the DOT on a $3.1 million project to reconstruct the interchange ramps at State Road 76 in Winnebago County north of Oshkosh. Throughout the construction, ramps were closed to all traffic until the project completion at the end of June.
In June the DOT began work on a $2.3 million project to replace the County Highway J overpass of U.S. 41 near Kaukauna in Outagamie County. The bridge, as well as the ramps to and from U.S. 41, were closed to traffic until the project was completed in October.
Fewer project improvements started up in Brown County in 2010, though work did get underway at the Scheuring Road interchange in De Pere, where roundabouts were constructed in late summer to pave the way for a complete overhaul of the interchange beginning this spring. The heat of August brought a welcome announcement by Gov. Jim Doyle that he would convene a meeting of the state Transportation Projects Commission to discuss a $350 million expansion and improvement of the State Highway 441/U.S. 10 interchange with U.S 41 in the Town of Menasha. Throughout the year, work continued on the Lake Butte des Morts causeway reconstruction near Oshkosh.
Republicans were unstoppable
While Republicans won big in November’s elections, from the so-called top of the ticket with Ron Johnson beating entrenched Democrat Russ Feingold for the U.S. Senate and Scott Walker beating Milwaukee Mayor Tom Barrett to win the Governor’s office, Wisconsin’s Statehouse was regained in both the assembly and senate. It’s arguable Republicans did even better in northeast Wisconsin: they didn’t lose a single seat locally, while picking up three chairs previously held by Democrats. In the 2nd Assembly District, newcomer Andre Jacque, a Green Bay Republican, decisively beat incumbent freshman Rep. Ted Zigmunt (D-Francis Creek). Across town in the 88th Assembly District, Republican John Klenke narrowly defeated two-term incumbent Jim Soletski (D-Green Bay). Republicans picked up an additional seat in the 5th District where incumbent Rep. Tom Nelson stepped aside to pursue a failed bid for Lt. Governor. Jim Steineke, a Kaukauna Republican, captured the seat. Republican Chad Weininger captured the 4th Assembly District, previously held by another Republican, Phil Montgomery, who stepped down after six terms. The same dynamic occurred in the 52nd District where Republican Jeremy Thiesfeldt took the seat held by six-term Rep. John Townsend (R-Fond du Lac), who also bowed out to retire. Likewise, political newcomer Michelle Litjens, an Oshkosh Republican in the 56th District, faced no opposition to take the seat previously held by Rep. Roger Roth (R-Appleton), who stepped aside to run for the Eighth Congressional District seat. In fact, the only two local Democrats from the Assembly to win were 54th District Rep. Gordon Hintz (D-Oshkosh) and 57th District Rep. Penny Bernard Schaber (D-Appleton), both re-elected to additional two-year terms. One additional highlight for Republicans – political newcomer Reid Ribble knocked off two-term incumbent Rep. Steve Kagen (D-Appleton) to capture the state’s Eighth Congressional seat, while Rep. Tom Petri (R-Fond du Lac) won a 17th term for the Sixth Congressional District.
Fox Cities Convention Center advances
Following up on a 2-year-old feasibility study conducted by the Fox Cities Chamber of Commerce and & Industry and the Fox Cities Convention & Visitor’s Bureau, City of Appleton Mayor Tim Hanna announced the creation of a Convention Center Community Coalition to further investigate the possibility of building a Fox Cities-based convention facility.
The coalition, made up of Fox Cities business and community leaders, recommended in November the construction of a new convention center near the Radisson Paper Valley Hotel in downtown Appleton.
Previous studies concluded the project would be most cost-effective if a convention center was constructed next to an existing hotel with large meetings rooms and exhibition space. Cost estimates ranged from $25 million to build the center next to the Radisson to $45 million for a new, freestanding center close to a full-service hotel. The coalition also made a number of proposals for the facility. First, it suggested the 18 communities in the Fox Valley should add a 3 percent hotel room tax to help finance the project. It also recommended that Outagamie County should sell its parking lot on W. Lawrence Street as a site for the development, and suggested the Paper Valley Hotel would need to operate the facility to reduce costs and minimize the burden on taxpayers. Ultimately, the coalition said the center could bring $8.4 million to the Fox Cities in its first year and create 140 new jobs.
Expansion projects of note
While many recent years featured large numbers of layoffs, 2010 featured some expansion plans. In January, Pacon Corp. in Appleton received $500,000 in tax credits from the state Department of Commerce for an expansion project to merge its Iowa operations into its Fox Valley operations, bringing 80 jobs to the area. That same month, the City of Oshkosh approved a $5 million tax incremental finance district in its Airport Industrial Park to help Oshkosh Corp. finance construction of a $51 million, 150,000-sq. ft. electrostatic paint facility.
March brought news that Canadian-based Central Wire Industries Ltd. received $163,000 in tax credits from the state to set up shop in Fond du Lac at the former Charter Specialty Steel plant in the city’s Southwest Industrial Park, employing as many as 30 people by the end of the year. That same month, Salm Partners of Denmark received a $900,000 Community Development Block Grant for Economic Development from the state to expand its operations and add 100 jobs, while receiving an additional $100,000 grant from the state to train new employees. Innovative Machining, Inc. in Neenah was awarded $116,000 in economic development tax credits in May to help it construct a 53,000-sq. ft. addition to its manufacturing facility, creating 20 jobs over the next three years.
In August, Coating Excellence International of Wrightstown announced plans to open a flexible packaging plant in Appleton by the end of 2010, providing 56 new manufacturing jobs. That same month, Kimberly-Clark Corp. announced plans for a $9 million, 129,150-sq. ft. expansion to its personal products manufacturing facility in the Town of Menasha, which expects to add more than 100 jobs when completed in early 2011.
Mercury Marine in Fond du Lac received $5 million in performance-based grants from the state to bring 200 assembly jobs to Fond du Lac, moving its MerCruiser engine and drive assembly operations from Oklahoma, a move it expects to complete by the end of 2011. Other substantial growth during the year came at Arla Foods of Kaukauna, which built an $8.9 million, 6,200-sq. ft. expansion project and created 41 jobs, and at Belmark Inc. of De Pere, which is undergoing a $9.0 million project to expand its production capacity and add 55 new employees.
Try, try, again: Referendum successes
In an era where state revenue caps limit schools officials’ ability to make significant capital improvements without a direct decree from local voters, a handful of school districts in the region found success in 2010 after suffering years of failure.
The most resounding success came in Green Bay on April 6, when voters overwhelmingly approved an $11 million referendum to repair and replace roofing, windows and heating, ventilation and air conditioning systems in district buildings. District residents also approved a second request to borrow $5.7 million to replace 5,600 computers and install a district-wide wireless network. Just three years earlier, district residents defeated a referendum to build a fifth Green Bay high school and fund other facilities projects.
The fifth time was a charm for voters in the Hilbert School District on Feb. 16, who approved borrowing $4.7 million to add new science classrooms to the middle/high school, renovate and add new technology to the high school media center and update the heating system at the elementary school. District officials had presented four other facilities improvement referenda to voters during the past three years, all of which had failed. Lastly, voters in the Winneconne Community School District approved a special referendum in June allowing school officials to exceed revenue limits by $850,000 for each of the next two years. Two months earlier in April, voters turned down a measure to exceed taxing limits by an additional $1.05 million for each of two years.
Reduce, reuse, recycle
Several new power generation facilities were announced for the region. The University of Wisconsin-Oshkosh is constructing a dry fermentation anaerobic biodigester, which will convert yard and food waste into energy. The first of its kind biodigester in the country, the project received $232,587 from Wisconsin Focus on Energy and a $500,000 grant from the federal government. The renewable energy facility will include heat and power generators, which will produce up to 10 percent of the campus’s electricity and heat once it’s operational in April 2011.
Construction also began in Ashwaubenon last November on a first-of-its-size pyrolysis gasification system, which uses solid waste and items that can’t be recycled, to create combustible gas used for energy generation. Oneida Seven Generation, a corporation owned by the Oneida Tribe of Indians of Wisconsin, is constructing the electrical generating facility, which will also produce waste materials that can be used to make carbon-based air filters. Lastly, EcoCombustion Energy Systems Corp. of Kaukauna was certified as a Qualified New Business Venture by the state in May. The company manufactures energy systems that convert animal manure into steam and electricity, allowing farm industries to generate an additional source of heat and electricity for other operations. The certification allows investors in EcoCombustion to be eligible for a 25 percent tax credit on their investment.
Paper industry wins anti-dumping paper case
In a story that carried over from a 2009 anti-dumping case, the U.S. International Trade Commission in March imposed tariffs ranging from 4 to more than 17 percent on glossy, coated paper imported from China and Indonesia to help offset government subsidies from those countries. The decision came in response to a complaint filed late in 2009 from three American coated paper manufacturers, including Appleton Coated LLC and NewPage Corp., which argued the subsidized paper exports allowed those companies to double their share of the U.S. market.
Those papermakers argued such subsidized paper exports ultimately lead to job losses and plant closures such as the NewPage plants in Kimberly, which eliminated 475 jobs, and in Niagara.
Downtown GB shopping mall dilemma
Efforts to reclaim valuable downtown property on which the remains of the former Port Plaza Mall/Washington Commons sits moved a few steps forward in 2010. In June, City of Green Bay officials received word that $1 million in federal funds would be made available for the demolition of the 450,000-sq. ft. building, though the funds hadn’t been received as of late December, and concern had surfaced that the new Republican majority in Congress might reverse the urban redevelopment earmark.
Nonetheless, Green Bay Mayor Jim Schmitt indicated as recently as December that the former shopping mall would be torn down regardless of federal funding, and hinted at the possibility of an undisclosed major employer relocating its headquarters to the site. Meanwhile, developers for the proposed WaterMark mixed-use development on the site of the former Younkers store hoped to wrap up financing on the $12 million retail and commercial building by the end of December and begin construction in early 2011. The project – which has been on hold for two years – will include a 15,000- sq. ft. home for The Children’s Museum of Green Bay.
Fox Valley Metro Police merger talks
In line with the emerging trend of municipal collaborative agreements that may prove to be one solution for continually-challenged local government budgets, the Village of Combined Locks re-initiated discussions in late October with the Fox Valley Metro Police Department about the possibility of merging together with its small police force.
Combined Locks turned down a proposal to join the Fox Valley Metro police force when it was created 15 years ago by joining together the police departments from the villages of Kimberly and Little Chute. Through the end of 2010, officials from all three villages and the two police departments were studying how a proposed merger would be structured, as well as the efficiencies that might be obtained through such a marriage. Those studies are expected to be complete a few months into 2011.
Menasha Steam Utility aftermath
The multi-year drama of the City of Menasha steam utility debacle settled down considerably in 2011 after city residents approved an April referendum to sell the assets of the utility to regional power supplier WPPI Energy for $18.2 million under a 20-year lease back agreement. The electrical-generating utility shut down in October 2009 after it defaulted on $24 million in municipal bonds a month earlier. The city is using proceeds from the utility sale to pay back some of the creditors for the facility.
Meanwhile, mediation efforts with a handful of investors who brought a lawsuit against the city reached an impasse in August and September, and is expected to end up in an Indiana federal court, where the original lawsuit was filed, sometime in early 2011.
Revamping Rolling Meadows – Fond du Lac
An Oshkosh-based development firm began work this past summer to redevelop the former county-run Rolling Meadows Nursing Home property in Fond du Lac into a hotel and conference center. The four-story, 100-room hotel is expected to provide banquet facilities capable of accommodating up to 600 people, making the largest such space in the community. The project is expected to be complete by this summer.
Outagamie Airport fixed-base operator saga
Outagamie County Regional Airport officials re-opened the airport’s fixed-base operator, renaming it Platinum Flight Center, after purchasing it from privately owned MaxAir Inc. for $970,000. MaxAir had been the only private provider of aviation fuel and services at the airport for the past 43 years. For years airport officials have argued the necessity of bringing another fixed-base operator to ensure competitive pricing on fuel and aviation services at the airport, and in March, the Outagamie County Board of Supervisors approved $1 million to establish a second fixed-base operator. Those plans were scrapped during the summer after MaxAir agreed to sell its operations to the airport.
Oshkosh Corp. keeps on ticking – delivers on promises
The U.S. Army upheld its decision to award Oshkosh Corp. a multi-billion dollar order to manufacture its Family of Medium Tactical Vehicles for use in the Middle East. The contract, originally received in August 2009, was challenged by two of the company’s competitors and lead to a re-evaluation of the bids at the recommendation of the federal Government Accountability Office. Oshkosh Corp. continued to fulfil other orders from the U.S. Military at a fast pace, including a new order, valued at $797 million, for more than 4,700 Family of Medium Tactical Vehicles trucks and trailers from the U.S. Army.
Business closures of note
While a number of expansions occurred in the region, there were some announcements of closures. In April, two longstanding commercial general contractors in the region – Fluor Bros. Construction Co. Inc. in Oshkosh and Stodola-Maas Construction Inc. in Fond du Lac – had closed their doors. AmeriPrint Graphics in Menasha closed in September, effectively laying off 20 employees. General Electric Oil & Gas said in November it plans to close its Oshkosh operation by the end of 2011 and lay off at least 111 employees.
Possible re-use of NewPage mill
Undisclosed investors are working with Village of Kimberly and Outagamie County officials to jointly fund a $300,000 study to determine the feasibility to convert two large machines at the NewPage mill in Kimberly and re-open the plant, which has been idle for two years. The investors – which have not yet been identified as a result of a confidentiality agreement – have committed $175,000 toward the cost of the study, while Outagamie County and the village will each contribute $50,000 and the state Department of Commerce will provide $25,000.
Kimberly-Clark Corp. asked the state Department of Revenue to cut in half the $45.6 million assessed value for two properties it holds in the Town of Menasha. If successful, the company could save about $112,000 in property tax assessments. Kohl’s Department Stores sued the City of Neenah in an effort to reduce the $7 million property value assessed on its Neenah store and to refund the $35,000 it paid in 2009 property taxes, plus interest and compensatory damages. The lawsuit from Kohl’s indicated the store has a value no greater than $5.5 million.
Mega dairy operations
Rosendale Dairy received approval from the Wisconsin Department of Natural Resources to modify its water protection permit to increase the amount of land upon which manure can be spread, enabling the dairy to expand its operations from 4,000 to 8,000 cows, making it the largest dairy in the state.