Posted Dec. 23
Weston vows to pay ex-workers
But the city no longer offering loans
By Charlie Mathews
Herald Times Reporter
TWO RIVERS There wont be any more loans from the city for Mike Weston, not with him owing around $1 million to the city, a bank, an attorney, and his parents.
The well has run dry, said Wayne Schultz, a member of the Two Rivers Business & Industrial Development Committee and Community Development Authority.
At last weeks BIDC / CDA meeting, the citys Economic Development Director Dan Pawlitzke showed members the nine mortgages linked to Westons former machining job shop in the industrial park.
Weston Machine & Specialty halted operations on Oct. 1, but M&I Bank had issued a foreclosure notice on Aug. 29. The company continued to employ its crew of 27 people until Sept. 30.
There are three loans from the city in 1995 for $502,650 with less than $100,000 paid down and subsequent loans with minimal payments leading to a debt in the seven figures. Pawlitzke said Weston had been an economic development success story during the 1990s but faltered the past couple years.
BIDC member Lee Brocher said the committee would continue to work with local business people in creating or expanding opportunities.
At last Wednesdays meeting, Brocher and colleagues agreed to loan Chris Rusch $30,000 for new equipment at his Rusch Machine. Patsy Walsh got BIDC/CDAs blessing on a $100,000 loan for her Highway 42 Mobil Mart on the east side of Two Rivers.
The committee/authority also agreed to transfer a mortgage from one Weston property to another to put the city in a better position to recoup proceeds from possible future sale of his industrial park building or his residence.
While members lament Westons business failure, one BIDC/CDA member said he hoped to never see the Weston name on an agenda again. After the meeting Steve Winter questioned Westons basic business acumen.
The relationship fell off which is unfortunate. The city was a great steward. He didnt meet his obligations, Brocher said.
When it comes to commitments for almost 30 Weston Machine and Specialty Inc. Employees that means getting paid for time worked but no wages paid. Health insurance premiums were unpaid leading to unforeseen medical bills, 401K contributions not deposited. There is a sense of betrayal and anger for many ex-employees.
Several of Westons former employees at 5024 Woodland Drive are unemployed but hes not.
Weston is general manager of Precision Machine Werks, incorporated Oct. 7 and operating out of the former Precision Woodcrafters building in Rockwood with about 15 employees.
Im currently working on acquiring the funds to take care of the rest of the past due taxes and health insurance, Weston said. Im working on getting something for some of the employees wages. This could take several weeks, he said.
Weston said all funds set aside for wages, benefits and taxes were among those assets that were seized, as was the lenders right to do so, he said.
Weston was able to convince several local businessmen to bankroll Precision Machine Werks. A document Weston gave to the Herald Times Reporter, that he said was cleared by his attorney, stated, Unless you have been involved in rebuilding a business that has failed, it is hard to imagine the challenges one faces, not only with financial affairs, but with your confidence.
Weston will be starting over virtually at zero once he can secure the funds to pay his employees. But (doing so) has always been first and foremost of his goals, and if it takes him the rest of his working career, on that he will succeed.
Several ex-employees accuse Weston of working them overtime in late September even though they contend he knew foreclosure by M&I Bank was right around the corner.
Theres a bunch of hoodwinking going on, abuse of us as workers, said John Paider, a machinst at Weston for two years. He is one of several ex-employees who have filed Wage Rate Complaints with the State of Wisconsin.
Were in the process of investigating the claims they are making, said Theresa Weidemann-Smith, of the states Department of Workforce Developments Equal Rights Division.
In November Mike and Gail Weston asked the BIDC/CDA to approve what they said was a plan, involving a new mortgage of $140,000 from First National Bank that would enable them to make good with the ex-employees. A resolution was passed unanimously to put the plan into motion.
But unbeknownst to BIDC/CDA members Weston had no such agreement said FNB senior lender Dan Lalko.
That proposal wasnt authorized by the bank, Lalko said. The interest I had was to give them money to operate the new company, not get involved in whatever problems (he had) in operating the old company.
Lalko said FNB wants to help propel the local economy under the right conditions. The bank advances credit on the ability of cash flow to repay the loan.
Whether Weston will generate proceeds at Precision Machine Werks that will go towards unpaid Weston Machine & Specialty apparently will not be known till or beyond.
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