WICHITA FALLS, Tx (RNN Texoma) - A company offered $2 million worth of incentives to come to Wichita Falls is closing up its Texoma operations.
Amfuel was in town for less than two years and will be out by the end of the year.
Amfuel President and CEO Len Annaloro said there are 20 employees at the company's location in Wichita Falls. They were told Tuesday morning they will be let go.
Annaloro said they have been offered jobs at the Amfuel in Magnolia, Arkansas, and they will be paid until the end of the year. He adds the Texas Workforce Commission will help them find new jobs if they turn down the out of state offer.
As of right now he said it is too soon to tell how many of them will take that offer, but did add a few people from their accounting department will continue to work long-term out of Wichita Falls.
Just last week the aerospace company announced it filed for Chapter 11 Bankruptcy.
Annaloro said the main reason they filed was to relieve Amfuel from prior inherited debt. Something he did not want to go into detail about.
He did say the biggest factor for the shutdown is they were told it would cost about $4 million dollars to get their equipment up to speed, something he said they cannot afford at this time.
Going back to April 2016, Amfuel held its ribbon cutting and was optimistic about its future in Wichita Falls.
Now that optimism is being called overzealous by Annaloro. He said the plan to hire 280 employees and move the aerospace business from Arkansas to Wichita Falls are reflections of that.
But what about the millions offered for the move?
Last week Henry Florsheim with the Wichita Falls Chamber of Commerce answered that question.
"The bulk of that package that was offered to Amfuel was never paid because the performance was not met," said Florsheim. "The incentives that have been paid out so far are around $594,000."
$51,000 of that went to cash-for-jobs.
"Which means they didn't get that money until they already employed a certain number of people for a certain period of time," said Florsheim.
He said the other part was a loan for equipment, and the city has a collateral position on that.
"Meaning should something happen that there's a good chance the city will get paid back for some or all of that investment," said Florsheim.
Since the aerospace company filed for bankruptcy, Annaloro said that means when it comes to the city getting its money back, that will be handled in court.
Florsheim said he knows there is always a risk and that is why the city protects themselves the best they can, adding some things, you cannot control.
"What we can control is how we structure a deal and how we put that together and what we offer to the company," said Florsheim.
Annaloro said he apologizes to the city of Wichita Falls and wanted the second facility to work out, but said sometimes they have to make management decisions like this.