By Chris Durden & Susan Gager
KWCH 12 Eyewitness News
7:29 PM CDT, September 18, 2012
Employees at the Siemens plant in Hutchinson learned Tuesday nearly half of them will lose their jobs.
“Certainly this is not only a blow to the Hutchinson community, but to the region and to the state of Kansas,” said Hutchinson City Manager John Deardoff.
"That's sad, because there's a lot of people here that are hard workers and that's a shame," said Angie Lewis-Thomas who's related to a laid-off Siemens employee.
Wind power manufacturer, Siemens, is laying off approx. 615 workers across the country, including 146 people in Hutchinson.
"We're in a situation where the market conditions have changed and we have to react to that by adjusting the business volume," said Jim Jones, interim plant manager at Siemens in Hutchinson.
“We have a workforce of about 35,000 people in Reno County so you can do the math on that. It's a major setback of a plant layoff,” said Hutchinson Chamber of Commerce president John Daveline.
Spokeswoman Melanie Forbrick says the permanent employees will be offered a severance package. They'll be paid for the next 60 days regardless of how much they work. She says it will gradually ramp down production during that time.
The company blames a downturn in orders and the future of the Production Tax Credit (PTC) for new wind turbine installations.
“One of our goals in the coming weeks and months is to garner enough support to see what we can do to get those tax credits reinstated to help with the future of wind energy,” said Deardoff.
"It's not because, you know, people weren't willing to go out there and work or they didn't like siemsn and didn't want to work out there," said Lewis-Thomas. "Congress dealt this blow to them."
Siemens is a German company with facilities around the world. It opened in Hutchinson in 2010. After the layoffs, it will still employ 152 people in Hutchinson.
Hutchinson city leaders say they worked hard to attract Siemens.
“There were cash incentives, tax abatements, land, and basically the incentive they have until of December 31 of 2014 to perfect those incentives. They've earned about half of those,” said Deardoff.
With half of the workforce being let go, Hutch residents worry about the trickle-down effect in the community.
“Finding work is a Godsend. This will have an impact on the local economy too. A lot of times they'll call out and cater lunches for their management team so it's very depressing news to my wife and I,” said Allie’s Deli and Coffee Shoppe owner Dallas Fowler.
It’s a hard day for employees, but city leaders view the layoffs as a temporary setback.
“This is a tough day for a lot of people, particularly those families of individuals who are losing their jobs and so obviously our thoughts go out to them, but we're going to work hard to secure the future of Siemens here,” said Deardoff.
"My family member liked Siemens," said Lewis-Thomas. "It was a great place to work. So, we hope Siemens can hang in there and Congress will change their minds."
The Hutchinson Chamber of Commerce is putting together a rapid response team to help those who will lose their job to find a new one as quickly as possible.
Hutchinson isn’t the only community to experience layoffs by Siemens. The biggest losses for Siemens come in Fort Madison, Iowa where 407 people will be laid off from a wind turbine blade factory. The rest of the layoffs come from the Siemens facility in Orlando, Florida.
The Production Tax Credit
The PTC began in 1992 and had been renewed by Congress every few years. It is set to expire at the end of the year unless Congress acts to renew it again. The PTC allows wind farms to receive a credit of 2.2 cents per kilowatt-hour of electricity they produce.
Kansas Governor Sam Brownback supports the PTC. “I have been and will remain a strong advocate for the wind industry. While the federal government struggles with its effort to create a balanced energy policy, my administration will do everything we can to support the industry at the state level moving forward. – and to assist those Kansans affected by this announcement," the governor said in a statement after Siemens announcement.
Other supporters of the PTC include Senators Jerry Moran and Pat Roberts, President Barack Obama and lawmakers from Colorado, Iowa and several other states.
Kansas Congressmen Tim Huelskamp and Mike Pompeo oppose extending the PTC. "When companies build a business model around the continuation of taxpayer handouts, it harms families and communities just like in Hutchinson like today," Rep. Pompeo told Eyewitness News.
"We remain committed to maintaining our U.S. factories and will continue to support the U.S. industry as well as export wind turbine components to markets across the Americas," Siemens said in a statement announcing the layoffs.
There are more than 37,000 wind-manufacturing jobs in the United States. A study by Navigant Consulting on the American Wind Energy Association's website says extending the PTC for four years would nearly double the number of industry jobs.
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