The Ohio Department of Development is offering HPM $4 million in low-interest loans so the plastics and die-casting equipment maker can buy equipment for its growing business machining wind-turbine components.
But to get the money, HPM has to make payments on more $900,000 in tax money it owes to Morrow County, Ohio or face foreclosure.
Under an agreement reached by Christopher Filos, the top executive of HPM owner Taylor's Industrial Services LLC, and Morrow County, the company faces a Nov. 26 deadline to start making payments for taxes owed.
``We would proceed on our foreclosure complaint if we don't receive our funds,'' said Tom Elkin, assistant county prosecutor. He said Filos signed the agreement on Oct. 29.
Contacted Nov. 7, Filos said the foreclosure has been stopped. ``Everything's been settled, we are current and up to date,'' he said. Elkin said that is not correct. But the assistant prosecutor said county leaders want HPM founded in 1877 in Mount Gilead to make apple presses to succeed. Taylor's Industrial Services of Tinton Falls, N.J., bought the assets of HPM in mid-2001, saving the company from liquidation.
``I think they're really working hard to get it done, and we're hoping that they do,'' Elkin said.
Patricia Davies, director of operations at the Morrow County Development Office, echoed that optimism. ``I'm very impressed with what [Filos] is trying to do to bring the company around. He has a very impressive business plan,'' she said.
Morrow County Treasurer Daniel Green said on the morning of Nov. 14 that he still had not received the first tax payment from the company. Taylor's and HPM owe a total of $922,529 in unpaid personal-property and real-estate tax. The taxes date back several years.
Green filed the foreclosure complaint on Aug. 19 in Morrow County Common Pleas Court. He asked the court to order a sheriff's sale at HPM unless the money is paid ``within a reasonable time.''
Under the payment-plan agreement, Elkin said, the county has waived penalties and interest, but the company must follow a payment plan on back taxes. Once the company makes payments and follows the plan, future penalties and interest also would be waived, he said.
Elkins declined to say how many payments Filos must make, or what period of time for payments is spelled out in the agreement.
The U.S. market for plastics equipment business for which HPM builds injection molding machines and sheet extrusion lines is struggling. But HPM has become a major producer of large metal parts for wind turbines, seen as a major alternative-energy source of electricity.
As a result, HPM is in a position to benefit from Ohio Gov. Ted Strickland's plan to help retool the state's existing industrial companies into ``green energy'' businesses. Ohio's $1.57 billion stimulus plan includes support for renewable energy such as solar, wind and geothermal.
The Ohio Department of Development announced the loan to HPM on Oct. 27. The money would help HPM add 100 new jobs and secure its current 91 jobs, the state said.
The state loan ``is contingent upon having an agreement and adhering to that agreement to pay the money back [to the county],'' said Bob Grevey, public information officer for the state development department.
Elkin, who negotiated the tax payment agreement with HPM, said the state has not contacted him about the matter.
Grevey said HPM is an example of a company the state wants to assist. HPM has large-part, precision machining capability to make the housings and other parts for wind power.
``What makes it attractive is they're using their existing skills and capabilities in a way that enables then to take advantage of tomorrow's technologies, which is wind energies,'' Grevey said.
In addition to the back taxes, Taylor's also owes $500,000 for a loan from Morrow County's revolving loan fund. Filos recently has made some payments on that amount, said Davies, the county development official.
Davies said Morrow County is ready to move quickly once HPM gets its debt payments in order.
``We are working on this deal very strategically to improve the conditions in Morrow County and add jobs. And when he fulfills his community obligations, we'll be off and running,'' Davies said.