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Millennium gearing up again: Roswell factory has a contract for 16 buses(Albuquerque Journal (NM) (KRT) Via Thomson Dialog NewsEdge) Aug. 23--Despite major setbacks, including the loss in April of a $94 million contract with the state of New Jersey, officials at Roswell's Millennium Transit say the bus factory should restart production soon. The company has a contract to provide 16 buses to the city of Beaumont, Texas, and is currently evaluating its inventory and making plans to begin their construction, plant manager Ted Smith told the Journal this week. "We are seeking more contracts," he said. And a Roswell city official says the company has kept current on payments of a $4.3 million loan for more than a year. "Frankly, we've taken the fact that they've continued to make those payments as an encouraging sign that they plan to have a future," said Roswell Finance Director Larry Fry. Millennium Transit was at one time considered one of Roswell's best hopes for economic growth. In 2003, Millennium bought a shuttered factory owned by Volvo subsidiary NovaBUS, which was once the city's largest private employer, providing 850 jobs. Like NovaBUS and other former owners of the plant, Millennium builds Rapid Transit Series, or RTS, buses -- a design originally created in the late 1970s by General Motors that is considered the workhorse of many city fleets. When Volvo decided to close the plant on Roswell's former Walker Air Force Base, it cited sagging demand for the high-floor RTS buses. However, Millennium co-founder Les Kolls in 2005 said the rugged design was still popular in cities with heavy winter snowfall and aging, high-crowned streets. As part of the deal to buy the plant, the State Investment Council contributed about $2 million in mortgage backing, the city of Roswell kicked in another $2 million in loans from its water fund, and Pioneer Bank, which also services the mortgage, provided about $250,000 in financing. In mid-July 2005, the company announced it had landed an order for 289 city buses from New Jersey Transit, which handles public transit for the state of New Jersey. Negotiations were lengthy and the competition was stiff, Kolls said at the time. Soon thereafter, Millennium received about $2 million in training funds from the state's Economic Development Department's Job Training Incentive Program to hire and train 250 employees by April 2007 to fill the bus order. The Economic Development secretary at the time, Rick Homans, said Gov. Bill Richardson personally called New Jersey Transit to urge them to take a chance on the fledgling firm, which at the time had no other contracts. But troubles began to appear in early 2007. In February, Millennium surprised local officials by announcing it would lay off most of its workers, which then numbered about 100. A major stockholder, James Ludvik, told the Roswell Daily Record that he ordered the shutdown in order to do a complete inventory but that the layoffs would be temporary. In an e-mailed statement to the newspaper, Ludvik also said Millennium officials would seek changes to their loan agreements that would let them use some assets as collateral for a "working-capital credit line." The Roswell City Council unanimously approved the loan changes soon afterward. But in April, Millennium announced in a news release that it had lost the $94 million New Jersey order because of "inability to obtain necessary funding to complete the contract." New Jersey Transit officials did not return calls seeking comment. Since April, at least three Roswell area suppliers to Millennium have sued the company in local courts for nonpayment. But the company does have a few existing customers, among them El Paso and Pueblo, Colo. Chris Quigley, a fleet supervisor for the city of Pueblo, says the two Millennium buses in his 16-vehicle RTS bus fleet have served very well since their delivery in late 2006. "In fact, we'd like to pursue getting some more from them," Quigley said. Smith said the company's ownership has changed but that its founders, Kolls and Jane Somes, were still involved as officers of the company. Smith declined to provide details of the ownership change, or to give a current employee count for the company. Fry said because the company has stayed current on its loan payments. To see more of the Albuquerque Journal, or to subscribe to the newspaper, go to http://www.abqjournal.com. Copyright (c) 2007, Albuquerque Journal, N.M. Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |