(WisBusiness) WED News Summary — 4 June 2008

From WisBusiness.com …

— Flanked by somber union representatives and local officials, Gov. Jim Doyle compared the announced Janesville GM plant closing to a “death in the family” and said he would push for GM to consider putting one of its new lines in the plant.

If the plant does close, Doyle said the state would look into recouping money from the $10 million state grant GM received in 2004.

Brad Dutcher, president of United Auto Workers Local 95, said the plant employees want to work hard with GM to see if they can have a future product in Janesville but acknowledged that chances were slim.

“I don’t want to give our workers false hope, but we’re not giving up,” he said. He also said he’s tired of hearing about how old the plant is (production started there in 1919). “The only thing that’s old is the bricks,” he said, pointing out that the inside had been retooled and modernized.

— — Janesville will need a long-term approach if it’s to recover from the idling of the General Motors facility there and the expected loss of 2,600 jobs, former Kenosha Mayor John Antaramian said.

Kenosha went through a similar situation 20 years ago, after Chrysler purchased American Motors and shut down the car assembly plant in that city, cutting some 5,000 jobs.

Antaramian, who was in the state Assembly when the plant shut down and won the first of his four terms as mayor in 1992, said Kenosha’s first move was to meet with the company to determine what Chrysler was willing to do to help the workers who lost their jobs and the community at large. The company continues to operate an engine assembly plant in the city, and Antaramian said it stepped up to help those workers who lost their jobs.

The city then began to assess what it needed in terms of economic development opportunities and worked with the state to take advantage of available programs. He said Kenosha immediately began to look at smaller industries it could bring in quickly to help offset the loss of the Chrysler jobs. The city eventually began to attract a number of food processing plants and created some industrial parks to help bring in other businesses.

He said the community is in many ways stronger than it was 20 years ago because its economy is more diversified. But the city is still trying to bring wages rates back to where it was before Chrysler shut down.

“There are a lot of good things that have happened in the past 20 years, but you have to look at the cost to the people at what the cost was to the community,” he said. “Are we better off? I think the community is better diversified and strong, but there were a lot of people who were hurt.”

— The UW Board of Regents is set to hike tuition by 5.5 percent at the UW System’s four-year campuses for the 2008-09 academic year this week.

That increase translates into an additional $348 per year at UW-Madison, followed by a $340 annual increase at UW-Milwaukee and a $265 increase at the 11 remaining four-year campuses. The Regents will continue the tuition freeze at the system’s two-year campuses.

A statement from UW indicates that 3 percent of the hike will help fund the veterans’ tuition remission program, with 1.6 percent allotted to programs in the UW Growth Agenda. The remaining portion will be taken up by increased costs for employee health care, student technologies and campus utilities. The UW will also absorb an undetermined amount of payment lapses in the state’s budget repair bill.

Regents President Mark Bradley called the increases “predictable” and “modest” but urged an increased focus on financial aid.

“At a time when our state desperately needs more college-educated workers, we cannot risk losing any college-bound students who might be shut out by the lack of available financial aid,” Bradley said in the press release.

The board will take up the tuition proposal, along with the nominations of new chancellors at UW-Madison, UW-Parkside and UW-Whitewater, on Thursday at its meeting in Milwaukee.

*See the UW statement:
*See the Board of Regents agenda:

— Participants in a WisPolitics.com/WisBusiness.com forum on the economy today said that while the GM plant closing would be a blow to Janesville and Rock Co. in the short term, it may prove to be a long-term opportunity to further diversify economically as Kenosha did after Chrysler closed its plant in that southeastern Wisconsin city in the 1980s.

Also softening the blow to Rock County is that a lot of its residents work in the Madison metro area or in service businesses unrelated to the plant. Participants suggested the plant closing won’t be the blow it would have been 20 years ago.

“It won’t be the disaster that it would have been,” said Edgewood College economics Prof. Bill Duddleston.

But in closing remarks, NFIB-Wisconsin’s Bill Smith said that while “some opportunity” may come from the Janesville plant closing, “clearly small businesses are going to be impacted.”

Most panelists also said despite the slowdown in the economy, the state itself wasn’t in a recession. Department of Revenue economist John Koskinen pointed to the state’s dipping unemployment rate, for example. And First Weber CEO James Imhoff said despite national housing woes, state real estate numbers in 2007 were still historically high and not as bad as many media report suggested.

But state Rep. Patricia Strachota, R-West Bend, said of her constituents: “It may not be a recession, but they are feeling the pain.”

Scott Lockard, the Madison market president of U.S. Bank, also participated in the panel discussion.

The event was sponsored by AARP and was recorded for later broadcast by WisconsinEye, which planned to air the program at 8 p.m. today on its Web site and the network. It is expected to be posted on the network’s Web site for on demand viewing sometime tomorrow.

See the WisconsinEye Web site:

— Midwest Air Group, the Oak Creek-based parent company of Midwest Airlines, has announced that Joseph Kolshak has resigned as its chief operating officer after only four months on the job.
The company said Kolshak has resigned “to pursue another opportunity.”

Timothy Hoeksema, chairman and chief executive officer of Midwest Air Group, said a search for a new senior operations executive will begin immediately.

See story: http://www.biztimes.com/daily/2008/6/3/#midwest-airlines-coo-resigns


WisBusiness.com-Edgewood College MBA Speaker Series:
Corey Chambas, President and CEO of First Business Financial Services Inc.

Monday, June 16, 5:45 pm
Sonderegger Science Center, Rm. 108, Edgewood College

–Part of the WisBusiness.com Speaker Series presented by Xcel Energy–

WisBusiness.com and Edgewood College present the MBA Executive Speaker Series on Monday, June 16, with special guest Corey Chambas, President and CEO of First Business Financial Services, Inc.

First Business is consistently ranked as one of the fastest growing companies in Dane County, with company holdings in Madison, Milwaukee and Appleton and nearly $1 billion in assets. Mr. Chambas will discuss building and maintaining corporate culture in a public company and the state of the Wisconsin economy.

This event is open to the public. There is no charge to attend, but for food planning purposes please RSVP to [email protected]




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Janesville bracing for future without GM plant: Experts say there’s virtually no chance Janesville will hold onto any General Motors production past 2010 despite efforts promised by state and local officials to keep the plant running and retain some of its 2,390 employees. “Realistically, (the chances are) very, very, very small,” said Brett Smith, senior industry analyst with the Center for Automotive Research in Ann Arbor, Mich. “GM simply has too many facilities in the system, if you look at where its market share is today,” said Catherine Madden, senior analyst for Global Insight’s global automotive group in Troy, Mich. “There isn’t any sort of recovery expected that could bring those plants’ closures out of the mix.” The Janesville factory, open since 1919, is one of four truck and sport utility vehicle plants that will close, GM chief executive Rick Wagoner said Tuesday.

Jobs lost at GM will top recent state totals: Roughly 2,600 people will lose their jobs over the next two years as a result of the closing of General Motor’s Janesville production facility — a figure that dwarfs the number of jobs lost in Wisconsin from any recent plant closing or business relocation, according to statistics from the Wisconsin’s Department of Workforce Development. To put the decision’s impact in perspective, the closest any other recent plant closing in Wisconsin will come to GM in Janesville in terms of jobs lost will be 500, when Domtar Industries’ closes its paper mill just south of Wisconsin Rapids on June 14. About 250 area workers lost their jobs when Brown Shoe Company decided earlier this year to move Famous Footwear’s corporate headquarters from Madison to suburban St. Louis.

As GM goes, so go many suppliers: Dominoes may fall in orbit of Janesville plant… General Motors’ decision to end production at its Janesville plant by 2010 will have a local business impact beyond job losses at the factory itself. Suppliers that make parts for the sport utility vehicles built there are expected to see business in Janesville reduced, if not ended altogether. Perhaps no vendor will be more affected than Lear Corp., whose Janesville plant makes seats and interior trim specifically for the GM vehicles assembled nearby. “It’s pretty much of a dedicated plant to that particular facility,” David Leiker, an industry analyst for Milwaukee’s Robert W. Baird & Co., said Tuesday. “There’s no reason for that plant to be there if they’re not building trucks.”

Study: Work force key to area’s success: A study by a local conservative policy research institute suggests the revitalization of Milwaukee’s economy is dependent on an increased flow of young workers into high-end manufacturing, among other solutions. The report, authored by members of the Thiensvillebased Wisconsin Policy Research Institute, stresses that Milwaukee must be the economic engine that drives the state.As retirements from wellpaying manufacturing jobs increase, it will be prudent to reconnect young workers with the need for highly skilled workers, according to the study.

Award reduced, then doubled in SC Johnson case: Instead of receiving $147 million in damages from defendants in the Milton Morris kickback trial, SC Johnson is entitled to $203.8 million, according to documents filed this week in Racine County Circuit Court. A jury originally ruled in SCJ’s favor in February and awarded $147 million in damages. The company had sued Milton Morris, its former transportation director, his second-in-command Katherine Scheller, and several of the companies they did business with after uncovering a widespread bribery and kickback scheme. Tom Russell and Thomas Buske, who ran several companies Morris had contracted with, were the primary defendants in the trial.

Midwest’s No. 2 resigns suddenly: Chief operating officer, on the job for 4 months, leaves for other opportunity… After just four months on the job, the No. 2 executive at the corporate parent of Midwest Airlines Inc. has abruptly quit. Joseph Kolshak, chief operating officer at Oak Creek-based Midwest Air Group Inc., has “resigned to pursue another opportunity,” the company said in a brief statement Tuesday. Midwest Air Chairman and Chief Executive Officer Timothy Hoeksema said the search for a new senior operations executive will begin immediately. “We thank Joe for his contributions in his brief time with us and wish him well in future endeavors,” Hoeksema said in a statement.


GREGG HOFFMANN: Contributor, WisBusiness.com

TOM STILL: President, Wisconsin Technology Council

JENNIFER SERENO: Senior manager, Wood Communications Group

STEVE JAGLER: Executive editor, Small Business Times

TOM BURZINSKI: IT executive and consultant

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– Can low-wage Midwest sell itself as an IT destination?

BIOTECH (back to top)
– Red wine chemical gives mice benefit of restricted diet, study says

ECONOMY (back to top)
– Prospects for replacing Janesville GM plant bleak

– GM has long, rich history in Janesville

– Minimal impact expected on Valley from GM plant closing: leaders

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MANUFACTURING (back to top)
– State officials urge GM to retool Janesville plant

– Manufacturing orders show upswing

LABOR (back to top)
– GM employees shocked by announcement of Janesville plant’s closure

– Wausau trucking company to lay off 340 workers

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SMALL BUSINESS (back to top)
– Madhatters finds a new home on Gorham Street

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INVESTING (back to top)
– ResCap needs $2 billion to stay in business

REAL ESTATE (back to top)
– Monroe Street hotel plans put on hold again

AGRIBUSINESS (back to top)
– CWT Program Announces Another Herd Retirement

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TRANSPORTATION (back to top)
– Town of Madison, Dane County step in to save South Side bus route

RETAIL (back to top)
– Toppling SUV sales sink GM Janesville plant

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REGULATION (back to top)
– Monona smoking ban takes effect next June

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– Smoke bans draw praise

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TOURISM (back to top)
– Back to Plan Commission for Camp Randall hotel

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– UPAF scrambles as one major corporate donor withdraws

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UTILITIES (back to top)
– Mayor wants to double solar energy use

– Federal grant will help Madison home and business owners install solar energy systems

– S. Wisconsin power line project approved

– Xcel to upgrade transmission lines

HEALTH CARE (back to top)
– Uninsured face long waits at Madison’s few free health clinics

– UW-Madison School of Medicine and Public Health called out for conflict of interest

– CUNA Mutual awards $24K in scholarships

– Four Madison-area banks lost money in first quarter

MANAGEMENT (back to top)
– Modine’s board OKs management changes

– Regents eye tuition plan

– Stonyfield Farms yogurt company leader to speak at marketing conference at Monona Terrace

– Brookfield wants out of convention and visitors bureau

– An EPIC undertaking

– Seize the Day award honors Cudahy

BUSINESS COLUMNS (back to top)
– Jim Mateja: GM parks the SUVs, squeezes into compacts

Media Partners
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