At least two Grant County businesses have been affected by the sudden halt on construction at the Getrag facility in Tipton County late last year.
Officials at Moorehead Electric in Marion and Industrial Maintenance Specialists in Gas City say their companies have not been paid for work performed in August, September and October at what was to be a transmission plant operated in a joint venture between U.S. automaker Chrysler LLC and German transmission manufacturer Getrag.
Work stopped at the facility in October, and Getrag Transmission Manufacturing LLC filed for bankruptcy in November.
The presidents of both Grant County companies say they've filed liens against the bankrupt manufacturer, but payment is no sure thing."We're just basically pursuing collections of our receivables through bankruptcy court," said Jerry Albrecht, president of Moorehead Electric in Marion.
Albrecht said his company is owed $9.6 million for more than two months' worth of unpaid invoices to Getrag. It filed its lien against Getrag in bankruptcy court in eastern Michigan.
Albrecht admits the unpaid invoices have affected Moorehead's bottom line.
"Like any company, it's squeezing our working capital," Albrecht said. "It makes it very difficult for us to obtain new business. We have to choose very carefully the types of projects we go after."
Albrecht said 44 contractors, mostly Hoosier companies, are owed $45 million in unpaid invoices by Getrag. He said efforts to get the contractors paid have been led by the Indiana Economic Development Corp.
One option is that Congress could direct some amount of future Chrysler bailout money toward the accounts receivable at those firms, said Blair West, director of communications at the IEDC.
"From our perspective, it's in the hands of Congress," she said.
West believes several Indiana companies have been devastated by the blow caused by performing so much work without compensation. She said the IEDC has communicated its wishes in regard to future Chrysler monies with the state's Congressional delegates.
Chrysler maintains the Tipton County operation was a Getrag project and that it shouldn't be held liable for the bankruptcy of its business partner.
"It was Getrag that abandoned the construction of the transmission plant, not Chrysler," Chrysler spokesman David Elshoff said in a statement. "In addition, the various contractors, subcontractors and suppliers were all employed directly or indirectly by Getrag, not Chrysler.
"Regrettably, the failure of Getrag to perform became the subject of a lawsuit which we initiated last fall," Elshoff continued. "Subsequently, Getrag sought protection under the United States Bankruptcy Code, and currently, the claims of the various contractors, subcontractors and suppliers, as well as those of Chrysler, are pending in such bankruptcy action."
The best bet for these 44 companies to receive their money is for the IEDC to find a buyer for the abandoned Getrag site in Tipton County. Such a buyer would be forced to first satisfy the liens against the property before transferring any money to Getrag.
That's according to Ronda Jones, president of IMS, who said her company is owed $1.6 million due to the Getrag failure.
The 40-person millwright and ironworker company is dealing with this loss of payment on top of an already weak economy, Jones said. She said the result has meant some short-term belt-tightening.
"Obviously, when you're dealing with that amount of money, it does impact cash flow," she said.
She said she's tried to contact federal officials directly but to no avail. She thinks it's "a long shot" that any provision will be made for her company in federal bailout money as a result of Getrag's nonpayment.
"My feeling is it'll go through the bankruptcy courts," she said, adding that the drawn-out nature of the judicial process adds another level of complication to this situation.
"You have two conglomerates arguing," Jones said, referring to Chrysler and Getrag. "The little guy gets trapped. Now it's in the court system, where nothing moves quickly."
Jones said she's confident her company will nevertheless weather this challenge.
"We're still working, and I think we'll work through it."
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