Is this really “economic gardening”?
Manistique Papers Inc., an Upper Peninsula paper mill operation, has been saved from liquidation by Gov. Rick Snyder’s administration.
The Michigan Economic Development Corp. announced Wednesday that it had approved a loan of up to $5 million through the MEDC’s Michigan Business Growth Fund/Loan Participation Program for the troubled company.
Manistique Papers filed for Chapter 11 bankruptcy in August and was forced to shut down when its lender ended its relationship with the company. It had been facing possible liquidation when the MEDC and a new lender, mBank in Manistique, stepped in to rescue the company.
The Michigan Business Growth Fund/Loan Participation Program is an outgrowth of the Michigan Supplier Diversification Fund, which used federal money to help auto suppliers find new customers outside the auto industry.
Manistique Papers is expected to restart operations today, bringing back 45 workers and adding 90 over the next six months, according to a MEDC news release.
“This is what we mean by economic gardening, leveraging state resources to foster private sector solutions for businesses of all sizes and industry sectors,” Snyder said in a news release.
Aiding Manistique Papers, a 97-year-old company that has been through numerous ownership changes, no doubt is important to the Upper Peninsula’s struggling economy.
But is this economic gardening or a salvage operation?