MARINETTE — The initial resolution authorizing the issuing of promissory notes to fund a request from Fincantieri Marinette Marine for a short-term loan of up to $50 million to finance upgrades to the shipyard to help enable it to win a contract to build multi-mission combatants (MMCS) for the Saudi Arabia government failed to win approval of the Marinette County Board of Supervisors on Tuesday.

The board favored the resolution by a 19-10 margin, which was four votes short of the supermajority required.

Voting “yes” were Mark Anderson, Josh Anderson, Mike Behnke, Peggy Chaikowski, Ginger Deschane, Tricia Grebin, Paul Gustafson, Shirley Kaufman, George Kloppenburg, Tom Mailand, Tom Mandli, Don Phiillips, Joe Policello, Rick Polzin, Vilas Schroeder, Bill Stankevich, Clancy Whiting, Cheryl Wruk and David Zahn. Dissenting were Joe Banaszak, Glenn Broderick, Gilbert Engel, Robert Holley, Ken Keller, Al Mans, Fred Meintz, Don Pazynski, Al Sauld and Ted Sauve.

Board Chairman Mark Anderson and County Administrator John Lefebvre said after the meeting they were unsure how the county will continue efforts to find a way to help Fincantieri Marinette Marine.

“As for the current proposal, I would say the door is shut,” Anderson said. “We have to sit down internally and sit down with Fincantieri Marinette Marine in regards to whether they want to move forward and how we can move forward to assist that large employer to make something positive happen.

“We would probably have to come up with a suggestion probably by the April 17 meeting if it’s going to do any good to RFPs that they would have to put together to qualify for the contract (for the MMCS). I don’t know what the answer is, I don’t even know if we can come back with a proposal that would meet their needs and calm some of the concerns that board members had.”

Concerns that some supervisors voiced Tuesday included the amount of the loan, the risks of borrowing it and why the loan couldn’t be obtained from a bank.

“We’ll sit down and regroup and see if there’s something we can come back with,” Anderson said. “Hopefully we can come back with an idea.”

He said he thinks one of the reasons the board didn’t adopt the resolution was that the loan issue got “meshed” with a proposal for the board to ask the Wisconsin Legislature to authorize counties to enact an additional half-percent sales tax for community and economic development. Anderson and Lefebvre have repeatedly said the loan and sales tax were completely separate issues.

“I think that started a negative debate in the community,” Anderson said. “It’s too bad those two merged themselves.”

Lefebvre said “hopefully the county and the county board can find some other way to support Fincantieri Marinette Marine that’s acceptable to it and the county board.”

“We need to find a way to support them them to make them look good to whomever they submit their RFPs to,” he said. “That’s the goal. If $50 million was too much maybe there’s something else we can do to strengthen their position and grow the community. Hopefully they’re in a good position to receive the MMCS contract.

“There’s a lot of different ways we can help them, not just loaning them the money, They still need community support in other ways. From Niagara, all the way down we need to find a way to do economic development.”

Lefebvre noted that Fincantieri Marinette also will be competing to build Frigates for the Navy when the Littoral Combat Ship program ends in 2020.

Before a lengthy debate over the proposal to help Marinette Marine, the board heard impassioned pleas to approve the loan resolution from several Fincantieri Marinette Marine workers and union representatives including Jan Allman, its president, CEO and general manager.

She stressed that upgrades to the shipyard are required for the MMCS and Frigate programs and that Fincanteiri needs a bridge loan to assist with the cash flow to help fund $100 million in improvements, half  that it plans to pay for itself.

“We talked with the county about a bridge loan,” she said. “We welcomed the idea because it potentially offers us a lower interest rate than what we could get from financial institutions.

“This would be a loan that Marinette Marine will fully pay back to the county with interest. It has nothing to do with a grant. Marinette Marine would only receive the loan if the Saudi program was awarded. The LCS program is winding down, MMCS represents a short-term future for Marinette Marine as well as a transition for future opportunities like the U.S. Navy Frigate.”

Allman said the loan would be “critical to maintain employment (1,500 workers) at the shipyard. The MMCS has the potential to create 400 additional jobs in the shipyard, which points to 3,500 new jobs in the community.”

“The Saudis have already put significant funds upfront for this program,” she said. “Fincantieri has already invested over $200 million in the Wisconsin shipbuilding program. We’re here to stay, they are ready and willing to continue to develop Fincantieri Marinette Marine.

“Investments by Fincantieri have transformed this into a top-tier shipyard. Competition is very intense at this level, we want to maintain our status in the national industrial base of the U.S. Navy and continue to grow.”

Allman said the Navy and the U.S. government “see community support as a sign of long-term commitment and our growth depends on establishing a partnership with state and local governments as well as the local communities.”

“We have talked about north and south,” said Supervisor Bill Stankevich, who represents the Goodman area. “This really doesn’t affect the north that much, but it does affect the lives of 1,500 people, maybe double that with children and the local economy. 

“For that reason I am going to support this because I don’t want to have face those people if something goes wrong and I’m the one that voted ‘no.’”

“I support this wholeheartedly,” Whiting said. “I think we’d be seriously remiss if we did not move forward. This is needed to move Marinette County forward. It would be a big mistake if we didn’t move forward just to send a message to either the state or federal government that we’re interested in bringing large manufacturers to our community.”

Lefebvre explained that initially Fincantieri Marinette Marine requested a grant of between $15 to $20 million from the county, saying that the county doesn’t have the authority to give grants to private companies and that the county’s current half-percent sales tax is used mostly for debt retirement.

He said Fincantieri has also reached out to state and federal lawmakers for possible grants. He said the City of Marinette doesn’t have any more Tax Increment Finance Districts (TIFs) to create to help the shipyard and that the Fincantieri is seeking harbor assistance from the City of Menominee because improvements will be made to the harbor. 

“I cannot support this, we’re not a bank, we’re not a financial institution,” Holley said. “They are a very large corporation. They’re worth billions. I believe they should go to a bank and not burden the taxpayers.”

Grebin said she supported the resolution because “I want Marinette County to be known as a county that supports industry” and that “we can help Fincantieri be more competitive with lower interest rates.”

“In my tenure of over 40 years on this county board, I don’t think we’ve every had a request for $50 million and I think we should keep that in mind and not lose fact of the wishes of the constituents that put us in this position,” Sauve said.

“A ‘no’ vote will not force Fincantieri Marinette Marine to close down or move,” Pazynski said. “A ‘no’ vote will not cause Marinette Marine to lose out on this forthcoming Navy bid. A ‘no’ vote will have no effect upon whether or not Fincantieri Marinette Marine is selected to building four ships for Saudi Arabia.

“Fincantieri is a multinational corporation worth billions. As such it requires affiliation with banks worldwide undoubtedly with access to lines of credit when needed. To proceed with this loan would be an unneeded, careless and financially irresponsible allocation of county resources, all in the name of economic development.”

“Presently the risk associated with the loan is more than the county should consider,” Lefebvre said. “However, upon the award of the MMCS contract the risk declines drastically.

“We have not looked at anything to do with their financials. All we have had is conversations about providing support and the types of improvements they intend to make to the shipyard and what it means for the community.

“Adopt the initial borrowing resolution and we will need to look at the financials. My recommendation is to approve the initial borrowing resolution, which demonstrates support and affords the county the opportunity to work with Fincantieri Marinette Marine to put together the loan details for further consideration by the county board.”