Monday, December 30, 2019

Readers choice: looking back on 2019

As 2019 draws to a close, the Oshkosh Examiner takes a look back at the stories that readers read the most. The Oshkosh Examiner concentrates on scoops and exclusives, and most of these stories fit into those categories. Click on the headlines to read the original posts.

1. Archaeological dig at Oshkosh headquarters site yields 20,000 artifacts, eight sets of human remains

It was old news, very old news, that was the big news of the year. In October readers of this site learned that the remains of eight Native Americans, believed to have been buried at least 800 years ago, had been recovered from the site of the nearly completed global headquarters of Oshkosh Corp. 

2. Menominee Nation Arena developer called insolvent; builder wants the keys, says false financial data used

Stories beginning in early August described financial troubles at the Menominee Nation Arena, whose owner has filed for bankruptcy and is working on a plan to reorganize its finances.

In April, the Oshkosh Examiner broke the news that the skies over Pioneer Island would be full of bombs bursting in air and rockets red glare come as the city opted to move the annual July 4 fireworks display from Menominee Park.

In June the Oshkosh Examiner was the first to report that local officials were calling on Winnebago County Coroner Barry L. Busby to resign in the wake of his erratic behavior, including extended absences from the state, the dismissal of his longtime chief deputy and sexual harassment incidents that got him temporarily banned from meetings of the state professional association whose members investigate suspicious deaths. He turned in his resignation in August.

5. UW Oshkosh graduation party is getting smaller as Molly McGuire's drops out of annual beer gardens

The Oshkosh Examiner scooped in April that beer gardens, the traditional outdoor celebration of the end of the UW Oshkosh school year, would be taking place at only one off-campus bar in 2019 as rising costs prompted Molly McGuire’s to drop its request for a special event permit. The Common Council voted to allow Kelly’s Bar, 219 Wisconsin St., to hold a two-day “Graduation Beer Garden” on May 17 and May 18. But Molly McGuire’s owner Tom Taggart said he was dropping out after sponsoring the event for about 25 years. “The costs make it impossible to do,” he said. “Every year the city’s costs go up and up and up.”

6. Oshkosh area leaders putting together plan for outdoor sports complex to support teams, draw tournaments

In January local community leaders were reported to be in the preliminary stages of planning a multiuse outdoor sports complex to address needs illustrated in a joint study between the Oshkosh Convention and Visitors Bureau and Rettler Corp. According to the Oshkosh Sports Facilities Feasibility Study, the city’s current facilities are functional but need improvements to lighting, concessions, restrooms and bleachers.

7. Oshkosh OKs sale of south-side land for 'Sawdust Lofts'

The Oshkosh Examiner reported in November that the city’s Redevelopment Authority had agreed to sell a south-side parcel valued at $150,000 for $1 to a local development company that is proposing to build 60 units of “workforce” apartments there. Northpointe Development Corp., which is owned by Andy Dumke and Cal Schultz, won out over three other entities that had ideas for the contaminated lot, which is in the 700 block of South Main Street.

8. Oshkosh Defense is accused of rounding time records to cut pay, reduce overtime in federal lawsuit

In March the Oshkosh Examiner reported that Oshkosh Defense workers were pressing a federal lawsuit that alleges the company illegally rounded time-clock records to cut compensation, especially overtime pay. Workers argued that since October 2015 the company had used a time clock policy in which “hourly employees’ start- and end-times for their shifts were rounded in 15-minute increments.”

9. UW Oshkosh student says his rights have been violated in sexual assault investigation, pushes federal lawsuit

In September fallout from a sexual encounter between two UW Oshkosh students landed in federal court, with the male plaintiff arguing that the school has “flagrantly violated” his constitutional rights in pursuing the matter. The case stems from a party sponsored on March 16 by a campus sorority at Winkler’s Westward Ho on County Road S, according to court papers. One of the sorority sisters invited a member of a campus fraternity to attend as her guest, and the two of them took part in the event along “with many other male and female students of the university,” the court filing says.

10. Walmart sues to lower its Oshkosh tax bill

Renewing its legal battle with the city of Oshkosh, Walmart filed suit July 3 to have $6.2 million knocked off the assessment on its South Washburn Street store. The Oshkosh Walmart is valued by the city at $16.6 million, but the company says it's worth only $10.4 million. The company sits atop the Fortune 500 and had $500 billion in sales last year. But like other major retailers, it believes that its stores are worth much less than local real estate assessors have determined. Two other “big box” retailers, Lowe’s and Menards, had already won significant rebates from the city on the grounds that their buildings were overassessed. By the end of November, the city had agreed to lower the store’s assessment and its tax bill.

Thursday, December 26, 2019

Oshkosh arena reports wider loss in November

The return of the Wisconsin Herd for its regular season was not enough to push the arena out of the red. 

By Miles Maguire
The monthly loss at the Menominee Nation Arena jumped by $87,000 to almost $300,000 in November despite the start of the Wisconsin Herd season.

At the end of last month, the owner of the facility, Fox Valley Pro Basketball Inc., had a negative net worth of $5.6 million, up from $5.3 million at the end of October, according to papers filed in U.S. Bankruptcy Court.

The Herd is the major user of the arena, and the four games the team played there last month helped boost food and beverage sales and sponsorship income, the latest financial statements show.

At the same time direct costs went up as well and more than offset the higher revenue. In October the arena recorded a gross profit of $18,840. But that number swung to a loss of $19,572 in November.

Gross profit reflects the direct costs of running the facility without taking into account fixed costs like depreciation and taxes.

The lawyer who is handling Fox Valley’s bankruptcy was not immediately available for comment.

Another source of income, tax rebates from the city, has dried up for the year. In October Fox Valley recognized $86,000 in income from the city’s tax incremental financing (TIF) obligation. No such income was received in November.

For the first 11 months of the year, the arena had a gross profit of $158,672. But once $4 million in interest expenses and other costs were factored in, the owner of the facility had a net loss of $6.8 million.

The report of the continued losses at the arena comes as Fox Valley awaits word on its request to take more time to put together a plan of reorganization. The plan was originally due last week but may not be filed until the end of February.

Creditors who oppose the request for more time have until the end of next week to file their objections. Some major creditors have already said they are willing to give the arena operator the extra time.

Wednesday, December 18, 2019

Oshkosh arena owner seeks more time to put plan together, cites progress on operations, management

Future Bucks LLC, the owner of the Wisconsin Herd, is said to have approved the delay.
This post has been updated with information about the arena's new chef and his past affiliation with the Cannery Public Market in Green Bay.

By Miles Maguire
The owner of the Menominee Nation Arena has asked for more time to file a plan of reorganization in U.S. Bankruptcy Court.

“The debtor is not a large company, but they face a complex reorganization,” said Evan Schmit, an attorney for Fox Valley Pro Basketball Inc., in a motion dated Dec. 16.

Fox Valley filed for bankruptcy protection Aug. 19 and had an exclusive right until Dec. 17 to propose how to resolve its financial problems.

The company wants an extra two and a half months to develop a plan and says it has the support of many, although not all, of its creditors. Those who have agreed to the extension include the city; Future Bucks LLC, the owner of the Wisconsin Herd; and the Menominee Indian Tribe of Wisconsin, Schmit said.

Those who have not explicitly endorsed the extension include the arena’s largest creditor, Bayland Buildings Inc.; Oshkosh businessman Eric Hoopman; and the law firm that used to represent Greg Pierce, the president of Fox Valley. Lawyers for Bayland and Hoopman were not immediately available for comment.

“The debtor reached out to counsel for Bayland but was unable to connect prior to the filing of this motion,” Schmit said.

As the end of the year approaches, potential lenders are likely to focus more on closing existing deals rather than working out the terms of new loans, Schmit said.

“The debtor believes that little progress will be made toward financing or a plan during the upcoming holidays,” the filing states. “The debtor believes that with additional time it will be able to obtain financing to provide more favorable terms to creditors.”

As of the beginning of December, the arena had about $29 million in debts and about $24 million in assets.

Lawyers for the arena argue that good progress has been made in improving the business, which includes a restaurant called the Maple Pub. For example, Fox Valley has hired a new executive chef, Toby Reichart, who is working on a revised menu intended to “increase the debtor’s food and beverages revenue,” court documents say.

On the LinkedIn social media site, Reichart describes himself as a “traveling emergency chef” and restaurant consultant. He had been working at the Cannery Public Market in Green Bay, but that role ended in early August, said Erin O'Toole, the Cannery's marketing manager.  

Fox Valley is also broadening its management team by hiring a “director of marketing to further increase ticket sales and sponsorship revenue and a controller to assist with the internal finances,” according to court papers.

As previously reported the arena owner has hired two brokers to help with finding new financing, switched ticket agents and dropped some expensive suppliers.

The arena owner is projecting to expand its events offerings starting in February. “The debtor has also been meeting with a number of high profile entertainment groups and specialty partners, to discuss the possibility of creating unique offerings and programming,” according to the court filing.

If the delay is granted, Fox Valley would file a reorganization plan by Feb. 28 and try to get it approved by April 30.

Oshkosh is waiting to see what the next steps will be on the arena’s financial plans but has “no legal objection” to the delay, said City Manager Mark Rohloff.

Wednesday, December 11, 2019

UW Oshkosh to offer early retirement to up to 300 employees as enrollment falls more than expected

Fewer students are transferring in and more are leaving after the first year, university officials said.

By Miles Maguire

UW Oshkosh is bracing for staff reductions and budget cuts as final enrollment numbers for this year have turned out to show a sharper decline than previously reported.

The school plans to offer retirement incentives for roughly 300 eligible workers at its three campuses while also taking another look at modifying academic programs to address low-enrollments and pushing for more online courses targeted at adult students.

“A final analysis of our fall 2019 student enrollment and retention data reveals declines more severe than those projected,” said Chancellor Andrew Leavitt in a campus email Dec. 9.

He went on to detail a five-part plan to address the situation, including stepped up efforts to recruit foreign students, a delay in rebuilding financial reserves and the “development of a new and visionary strategic plan.”

In October the university said it had enrolled the equivalent of 8,410 full-time students, against a target of 8,517. But the school said Monday that that actual size of the shortfall was 120 to 130, rather than the 107 originally estimated.

The increased shortfall brings the current year budget gap to $1.2 million, and the school is now projecting a $4.1 million budget gap for the fiscal year that begins July 2020, according to officials.

UWO administrators hope to cut expenses by encouraging longtime staffers to leave. Qualifying employees will be offered 50 percent of their annual pay to retire early.

“Our analysis suggests there are more than 300 employees across all three campuses who qualify based on developed criteria,” Leavitt said The voluntary retirement program “can help us dramatically lessen the potential budget reduction we face.”

The alternative could be a budget cut of up to 7.5% for fiscal 2021, Leavitt said.

Employment at UW Oshkosh was 1,655 as of fall 2018, according to the UW System website. The number of Oshkosh faculty members is 298, according to a report provided last week to the Board of Regents.

Despite the staff cutbacks, Leavitt said he hoped to expand program offerings, using a management methodology called “lean business” to eliminate inefficiency. 

“Our thinking and our approach cannot be ‘instead of,’” he said. “It must be ‘in addition to’ when it comes to traditional undergraduate resident programs,” according to Leavitt.

“Our greatest area for future enrollment growth will be in adult education,” he said in his email. “Among other things, this demands we commit to more and stronger online offerings.”

The university also plans to work harder on attracting foreign students and got the go-ahead from the Board of Regents last week to hire a firm called Kings Education to handle this recruitment.

The Oshkosh campus had 125 foreign students in 2015, but that number fell to 63 this semester. Kings Education has already been working for the Fox Cities campus in Menasha and has been highly successful over the last three years, boosting the number of foreign students from 22 to 135.

UWO expects to take in more than $1 million from this new effort and will incur no costs under its contract with Kings. The company will be compensated through fees it will charge to the students it recruits.

The university will also review academic programs that are not attracting enough students, but Leavitt said that the goal is not to make cuts. “This is not about eliminating programs; it’s about making all programs more impactful for our students and the region,” he said.

UWO has been successful on the front end of recruiting new students, but its enrollment has been hurt by not holding on to students or attracting transfers. “A reduction in retention and transfer students has added greater pressure on the decline and must be counteracted,” Leavitt said.

In 2018 the school had 816 transfer students, but that number fell to 670 this year, officials said. Its retention rate for first-year students was 77.4% in fall 2017, but that dropped to 73.5% in fall 2018.

The drop is enrollment is “just one of several pressures” facing UW Oshkosh, Leavitt said. He referenced “historic, state disinvestments” in public higher education as well as the ongoing tuition freeze.

For the current fiscal year, the legislature increased operating funds for the UW System by $74 million while cutting capital funds by $87.5 million.

Thursday, December 5, 2019

Oshkosh arena owner seeks to hire second financial adviser to raise new capital for debt restructuring

A monthly operating report shows the Menominee Nation Arena owner increased its cash holdings in October.
By Miles Maguire
The owner of the Menominee Nation Arena is moving to hire a second financial adviser to help it raise capital so that it can restructure its debts.

Attorneys for Fox Valley Pro Basketball Inc. have asked U.S. Bankruptcy Judge Brett H. Ludwig to approve the hiring of Young America Capital, of Mamaroneck, New York, as a financing broker.

YAC’s assignment would be to seek out private investors “for some or all of [Fox Valley’s] assets or securities.” The company would be paid $7,500 a month for four months, sums that would be credited against transaction fees that it could earn for finding stock or debt investors.

“If YAC is successful, the debtor will be able to provide more favorable terms to creditors in a plan of reorganization, which is in the best interest of the debtor and the creditors of the bankruptcy estate,” Evan P. Schmit, one of Fox Valley’s lawyers, said in a Nov. 20 filing.

YAC is an investment banker that focuses on new and midsized companies, particularly by promoting nontraditional assets. One of its areas of expertise is the legal cannabis business, according to its website.

In addition to finding lenders, YAC may also engage in other activities, such as looking for new customers who could generate revenues for the arena or even looking for a buyer of the property. In fact the possibility of an outright sale is mentioned several times in a letter of agreement from YAC to Greg Pierce, CEO of Fox Valley.

“In the event of a sale transaction, purchase price shall include the fair market value of all gross consideration paid to the company, its employees, directors and shareholders, and includes any debt assumed in connection with a transaction,” the letter states.

But Schmit downplayed the likelihood of a sale of the arena, saying that YAC’s main focus is to bring in major investments that would allow Fox Valley’s largest creditors to be paid off.

The arena owner has already received the go-ahead to hire a different financing broker to try to monetize the future stream of tax incentive payments that are due from the city.

“YAC can bring in a bigger, more comprehensive package that would be more beneficial to creditors,” Schmit said in an interview.

In a separate filing, Fox Valley provided a financial report on operations for October, showing a net loss of $200,000.

“If you look at it, I think it’s positive,” Schmit said. “The debtor received some sponsorship payments and event sales [revenue].”

Despite the loss the arena’s cash balance rose by about $200,000 during October.

“In general I would expect November to be even better based on the start of the Herd season,” Schmit said.