RDA buying into industrial development group

by Emmitt B. Feldner of The Review staff

PLYMOUTH – The Redevelopment Authority will soon be a major stockholder in the Plymouth Industrial Development Corp.

The RDA Thursday approved a proposal from City Administrator Brian Yerges to purchase 500 shares of PIDC stock for $500 from attorney Mel Blanke.

“The long-term plans (for the PIDC) are up in the air,” Yerges explained. The stock purchase by the RDA would give the authority a say in future sales of land in the city’s industrial parks.

The PIDC was created in the mid-1960s as a for-profit corporation to spearhead industrial development in the city. It has used its funds to purchase vacant land for industrial development, facilitate infrastructure development and sell lots for industrial development.

The corporation was the aftermath of a ruling by the Wisconsin Supreme Court in 1966 that an industrial expansion fund established by the city in 1956 through a fee added to the utility bills of city residents was unconstitutional.

As a result of the ruling, the PIDC was created and the industrial expansion funds were transferred to the corporation. Each city resident was granted shares of stock, valued at $1 a share, in the PIDC based on how much they had paid in industrial expansion fees. The stock has not grown in value and does not pay dividends.

Yerges noted that many of the original 70,000 or more shares have never even been claimed.

Over the past several decades, Blanke – who heads the PIDC – has bought up outstanding shares from estates and other sellers, until he now owns about 2,500 shares, according to Yerges.

“We began to think what happens to the PIDC,” if something should happen to Blanke, Yerges told the authority members. “What happens to the assets and the land the PIDC owns?”

Yerges said that he, Blanke and City Attorney Crystal Fieber determined that the best immediate solution would be for the RDA to buy 500 shares of Blanke’s stock, using funds the RDA still has left in its budget from 2012.

“If (the 2,500 shares) ends up in estate, if somebody wants to buy a piece of (industrial) property next to (the proposed) GTS,” plant on County PP, they wouldn’t be able to, Yerges pointed out.

“That would be a disaster for us,” RDA member David Williams commented.

“There are literally thousands of people in the city who have X number of shares, maybe 10, maybe 50,” RDA chairman Lee Gentine noted. “Do we have a record of every shareholder?”

Yerges conceded that the records are sketchy. “Some (shares) were never redeemed and some were never issued. I thought Mel (Blanke) told me at least half have never been issued.”

As a public company, the PIDC holds an annual meeting, but Yerges noted that outside of the board of directors – which includes Blanke, Yerges and Gentine among others – only one other person has ever attended a meeting in many years.

Yerges also said that any PIDC meeting requires the attendance of at least one stock owning 500 shares or more, a group which currently consists of only Blanke.

Having the RDA purchase 500 shares of PIDC would ensure that the corporation could continue to meet and conduct business should something happen to Blanke, Yerges said.

“It’s a gray area. It doesn’t matter who owns shares, you need 500 (shares) to have a seat at the table,” RDA member Jerry Thompson added.

“If we put out a call and give people 180 days to redeem their stock, maybe we could write off that liability forever,” Gentine suggested.

Yerges said that, and other long-term issues concerning the PIDC, are still unclear and that the RDA’s stock purchase would only settle the question of being able to hold a legal meeting if Blanke is unavailable.

“There are still some long-term issues we’ve got to figure out with it,” Yerges said of the RDA.

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