Ohio plans status check of Perrysburg solar firm

Mario Gatto, left, Engineering Manager, shows Vice-President Joe Biden, right, and Dir. of Recovery for Auto Communities and Workers Ed Montgomery, a semi conductor panel ready for processing during a tour of the Perrysburg startup Willard & Kelsey Solar Group. THE BLADE/ANDY MORRISON Enlarge | Photo Reprints

State officials said Tuesday they will visit Willard & Kelsey Solar Group next month to check on the status of the Perrysburg company, which recently laid off about half its work force.

The company, which is partially funded by millions of dollars in state loans and grants, has reduced its payments on two loans provided by the state.

The start-up company has failed to live up to the production and staffing goals that its executive leadership set when it was formed in 2008. It laid off 40 employees this month.

In addition to the state loans, the company was conditionally approved for more than $3 million in state tax breaks, but it has not generated enough jobs to become eligible for those breaks, said Daryl Hennessy, assistant chief of the business services division at the state Department of Development.

“They created some jobs in their annual report but not at the level they said they were going to,” Mr. Hennessy said.

The company employs a little more than 80 people when it’s fully operational, said Michael Cicak, chief executive officer and chairman of the board. The company is privately held and does not release its financial information.

Mr. Cicak said Willard & Kelsey laid off employees because the company’s only assembly line is undergoing changes to produce more efficient solar panels.

Funding for that assembly line initially came from a $5 million loan from the state Office of Air Quality Development Authority. Officials from that department are arranging an inspection of the assembly line in February to ensure that money was well spent, said Todd Nein, interim executive director of the Office of Air Quality Development Authority.

“We really need to take a look at the line and what their plans are and what we’re able to do,” he said. “We really need to take a closer look at things.”

Mr. Nein said such an inspection is rare.

The $5 million is part of a $10 million loan that was partially disbursed in July, 2010. The rest of that money is set aside for the construction of a second assembly line, Mr. Nein said.

The first part of the loan has a two-year repayment plan, and Willard & Kelsey has been making payments on it, Mr. Nein said. Those payments recently were reduced and the state is working with the company to defer payments or create a longer payment schedule, he added.

Mr. Nein said the state has confidence in the company because its executives have experience with First Solar, one of the largest solar companies in the country.

The company also has reduced its payments on a $5 million loan from the Ohio Department of Development. It is paying about $7,800 a month on the interest of the loan, Mr. Hennessy said. That loan has a five-year timetable for repayment.

Mr. Cicak said he’s looking into various financial options to fund the company’s operations.

“No, I’m not closing,” he said Tuesday. “I’m going to try and work my way out of it.”

The company also received a rapid outreach grant for $500,000 from the Department of Development in 2008. That money was slated for job creation and retention, Mr. Hennessy said.

Adele Morris, policy director of the climate and energy economics project at the Brookings Institution, a Washington-based think tank, said she wouldn’t be surprised if cases similar to Willard & Kelsey’s appear across the country. Solar power is one of the most expensive areas of green energy and not every company is going to survive, she added.

“These are precious taxpayer dollars, and you want to be sure when you spend them you are not engaging in wishful thinking about what it’s going to accomplish,” Ms. Morris said. “I’m not saying that happened in this case in Ohio, but I think due diligence is critical.”

Mr. Cicak said more than $100 million has been invested in Willard & Kelsey and he’s determined to keep the company afloat.

“We’re trying to get more money so we can keep going big time,” he said.

Contact Kris Turner at: kturner@theblade.com or 419-724-6103.