Little Hope Remains For Wisconsin Officials Looking To Recover Funds From Failed Aircraft Deal

Bankruptcy Proceedings Ongoing For Company That Said It Would Create Hundreds Of Jobs In Superior

City and county leaders in northern Wisconsin hold out little hope they’ll recover most of the money they awarded to a now-bankrupt aircraft company as part of plans to build a plane manufacturing facility in Superior. 

Kestrel Aircraft Company and its parent company ONE Aviation Corp. filed for bankruptcy last October along with 10 other subsidiaries. At the time of filing, the New Mexico-based business listed a total debt of more than $198 million. Of that, the company owes $53 million in loans to state and local governments, including around $3.4 million to the Wisconsin Economic Development Corp.

In 2012, Kestrel pledged to create 600 jobs in Superior in what was billed as the city’s largest job creation project since World War II. The city’s redevelopment authority loaned Kestrel $2.6 million and Douglas County provided a $500,000 loan through its revolving loan fund. As of last fall, the company owed the city $1.7 million and Douglas County $479, 421, according to court documents filed in Delaware....


Ken Notes: Economic Development 101

  1. Over 50% of new businesses ventures fail.
  2. Banks have procedures in place to deal with this.
  3. Government should offer incentives, programs and grants to encourage these banks and investors not replace them.
  4. Government should NOT pay out up front unless they are willing to lose the investment 50% of the time.
  5. The very term LLC was invented to Limit Liability suing these entities if fruitless.
  6. An LLC is not part of the parent company - Ask ("I`ve never been bankrupt") Donald Trump.

- - Volume: 7 - WEEK: 32 Date: 8/8/2019 6:30:53 AM -