Joe Brown gave testimony before the Michigan Republican House Task Force on Jobs. While much of what he wrote applies to stampers all over, this part effected me the most. This very nearly happened to me.
Skittish banks are declining loans to many tooling suppliers since they consider anything with the terms “manufacturing” or “automotive” as red flags in the application or renewal document. How can these companies retool themselves without this? More disheartening is the devastation this has caused many long-time […] manufacturers and suppliers who were small business owners with impeccable payment histories. In an instant, many owners’ lives turned upside down.
The following excerpt is from my interview with Michigan’s 1993 Women’s Entrepreneur of the Year and a decades-long small business owner of a MTDM supplier in Fraser, Michigan. Her name is Nina Sylvester and sadly her story is similar to many other past—and current—Michigan manufacturing shop owners:
“Bank of America called and told me that they ‘No longer find that Automotive and Manufacturing are lucrative to their business and therefore will not renew my loan and I have 90 days to find new financing.’ Keep in mind that I was never late on a payment, nor am I to this day, 10 months later. I am at the office everyday collecting what little money is left in receivables which is a job in itself. No one is paying their bills, and I hear the same story from everyone. I had in excess of $100,000.00 in bankruptcies alone since the end of last year. I called and had packages put together and interviewed with 20 different banks. They all said the same thing. One bank in particular, Huntington National Bank, I asked them what they were doing with the money that was given to them by the government and she told me that they had it in an account collecting interest and were going to acquire other banks with it.
I also contacted the SBA and was told that they have programs for new businesses but nothing for existing businesses. Meanwhile the bank is on me to pay off my loans in their entirety. They forced me to stop manufacturing and taking orders, forced me to sell off equipment that was appraised in 2006 for $683,000.00. A boring mill that I paid $210,000.00 for, sold at auction for $15,000.00, and that is just one. Tooling that cost in excess of $20,000.00 went for $25.00. Now, I have a building that I paid $470,000.00 for in 1991, they are telling me I will be lucky to get $375,000.00 for. I still owe the bank $650,000.00 and don’t have a clue as to how I’m going to pay that back.
I have been in business 24 years, and have nothing but debt to show for it now. I have worked in this industry for 35 years, and never in my wildest dreams did I ever think that this would be happening in this country. Our government is quick to help foreign countries and will not help their own people. They continue to send work overseas when large corporations here are closing left and right.””