New Chrysler jobs? Turbulent past clouds Tipton's future
13 Investigates' “Where are the jobs?” series examines the claim of hundreds of new jobs for an Indiana community that has heard the promises before – and is still trying to turn the corner of its painful past.
There's excitement in Tipton. Lots of it. You can see it on the faces of the workers at Chrysler’s new transmission plant.
“This place is just outstanding,” said Joe Mahaney, team leader of the plant’s gear train line. “This is great for Tipton.”
But outside the Chrysler plant, there's also some concern about yet another promise of hundreds of new jobs for Tipton County.
"At this point, I don't have any evidence that I am seeing that,” a community leader told WTHR. “I don't know of any person that was unemployed in Tipton that has gotten a job."
The prominent Tipton County leader, one of several who talked to WTHR and who asked not to be identified for fear of reprisal by the automaker, says – despite all of today’s fanfare to dedicate the new facility – Chrysler has not filled the transmission plant with new workers.
“Our county residents were supposed to be able to get back to work, but we’re not talking about new jobs at the plant,” the leader said. “These are not new jobs.”
Ask just about any of the 200 employees now working at the sparkling, state-of-the-art transmission assembly plant how they got their “new” job, and they all say the same thing: through a Chrysler facility in Kokomo.
“All of our hourly [workers] came from up the street in Kokomo,” said Markeith Young, who now works at the Tipton plant after working at a Kokomo transmission facility for the past two years. “Our focus is really shifting our employees from Howard County to give them more opportunities here.”
Mahaney transferred to the Tipton plant after working at a Chrysler facility in Kokomo for 20 years, greatly reducing his daily commute.
Derrik Ousley, Chad Heath, Chris Monday, Brant Hughes, William Blair, Aaron Smith, Michelle Nelson, Derrin Brewer and dozens of other workers who talked to WTHR this afternoon all said they transferred from Kokomo, too.
“Hired from the street”
Chrysler admits, so far, it has filled nearly all open positions at the Tipton plant with associates from its nearby facilities.
When will Chrysler hire new workers to build transmissions in Tipton? Plant officials say they aren’t sure.
"That I don't know, but I can say we'll be hiring our second crew very soon and third crew by the end of the year," said plant manager David Dukes. “We will be bringing in new workers.”
Of the 850 jobs expected at Chrysler’s new Tipton transmission assembly plant, about half of them will be filled by existing Chrysler workers around Indiana, according to the president of the local labor union.
"The other half will be hired from the street,” said Rich Boruff, president of UAW Local 685.
With hundreds of positions left to be filled over the coming months, Chrysler’s official job posting website currently lists 9 available positions at the new Tipton facility.
Why does it matter whether the jobs are new or transfers?
Both the State of Indiana and Tipton County have offered Chrysler millions of dollars in tax breaks and incentives for creating “new” jobs. And if the Tipton jobs are largely awarded to residents who do not live in Tipton County, the county will lose out on what could be millions of dollars in income tax revenue.
“I understand the jobs need to go those who are most qualified, but we were told our residents would at least get a fair shot at applying for these positions. It now looks like Chrysler is just churning and shifting jobs from one place to another. That’s not what they told us would happen,” the county leader told 13 Investigates. “And they’ve already drained our checkbook.”
Tipton still financially “wounded”
While politicians have bragged that Tipton County will receive millions of dollars in tax revenues from Chrysler’s new transmission plant, that is not exactly true.
Those tax revenues are already earmarked to pay off millions of dollars in bonds to help pay for the Chrysler plant.
When Chrysler and Getrag announced plans to bring 1600 jobs to Tipton County in 2007, state leaders celebrated with a jubilant ground breaking ceremony. Within two years, the companies both declared bankruptcy, leaving county residents with a partially-built, vacant building -- and major community improvements such as a waste water treatment plant built for Chrysler that, to this day, is sitting unused. County commissioners took out bonds to pay for all that and to bring new business to the empty building.
Despite Chrysler’s return to the site, county leaders now anticipate a shortfall to repay the bonds, meaning it will have to dip into its general fund to make payments. Any remaining money from Chrysler tax payments over the next 15 years – if there were to be any -- must go to repay contractors who lost millions when the original project was halted. Tipton County’s debt will stick around long after Chrysler’s company executives leave today’s grand opening ceremonies.
“Even with the success of the present project and flow of additional property tax revenue, it will not be until 2029 that all debt is retired,” explained former Tipton County Commissioner Jane Harper, who helped negotiate the return of Chrysler to Tipton County. “The financial coffers and the optimistic spirit of the citizens were both severely wounded by the failed projects, and the road to return to prosperity and hopefulness will be long. In order to make a direct positive impact on the recovery, unemployed citizens of Tipton County will need to be considered for employment.”
A county leader, who asked not be named, echoed a similar sentiment. “We are still paying Chrysler's creditors. If we weren't still writing the checks, I could forget that, but it's hard to forget when you're still paying the bills. It will be a long time before things get back to normal around here.”
One of the creditors that lost everything was Moorehead Electric. The 70-year-old Marion company spent months installing electrical systems in the proposed Chrysler/Getrag facility before the companies abandoned their Tipton plans in 2008. When the companies filed for bankruptcy, they owed Moorehead Electric $9.5 million.
“We were told to leave the job site and to leave everything behind,” recalls owner Jerry Albrecht. "There was an immediate ripple effect. We had to close our office in Indianapolis, Fort Wayne, Muncie and, of course, Marion."
The company eventually laid off all 200 of its workers.
"A 25-year employee, a grizzled old electrician, came up to my office to say goodbye and cried, you know. It was very difficult," said Albrecht. “I’m really happy for Tipton right now to have the plant open, but it is bittersweet. We’d like to be in there finishing off building it. A lot of good people lost their jobs, and I think it’s appropriate to take a moment to remember that.”
Today, the talk inside the new Tipton transmission plant is not about the past. It is focused squarely on the future. As company executives and state officials posed for pictures inside the new Tipton transmission plant today, the mood is optimistic and festive. There is no talk of the past. The focus is squarely on the future.
“We’re all excited and just want to show off our new plant,” said worker Carl Sargent, who transferred from a Chrysler transmission facility in Kokomo. “This is a good day.”
A good day indeed. This afternoon, Tipton’s new mayor boldly told plant workers and company executives “it’s party time.”
Whether Chrysler meets its job projections – and hires workers from Tipton County – will determine how long the county’s party will last.