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Monday

July 2014

28

Golden Guernsey, last dairy in Waukesha County, shuts down

Waukesha Golden Guernsey plant locks doors

Dave Dvorak was in the middle of his shift delivering milk when he was told to return to the dairy.

He couldn't even finish his stops.

Dvorak, a 25-year distributor for the Golden Guernsey plant in Waukesha, was hearing for the first time that the 83-year-old facility was closing.

"I was working Saturday and got a call from my boss to bring back the truck as the plant was locked down," said Dvorak, of Stone Bank.

The closing has left 112 workers without a job and left school districts scrambling to try to find a replacement supplier for milk. The closing happened over the weekend, and workers have been left wondering what happened.

On Monday, outside the plant at 2101 Delafield St., there were a few cars lingering around the parking lot with only a security guard on hand.

"All the employees have been left to dry," Dvorak said on Monday. "Nobody knows anything. They didn't tell us. It's ridiculous."

Bankruptcy

On Tuesday, OpenGate Capital, a Los Angeles-based private equity firm that acquired the plant in September 2011, sought Chapter 7 bankruptcy protection for Golden Guernsey in Delaware bankruptcy court.

OpenGate Capital CEO Andrew Nikou addressed the closing for the first time in a news release Tuesday night.

"We have to make realistic decisions about our investments, and the reality is that the Golden Guernsey business was unable to achieve financial autonomy given the pressure to lower prices and seemingly nonnegotiable operating expenses," Nikou said. "This was a very difficult decision given the loss of jobs and disruption to milk delivery service, yet it had to be made.

"The closure of the plant is not a reflection of the hard work contributed by the Golden Guernsey family of employees. Unfortunately, when expenses overwhelm revenue for too long, and we are unable to achieve cooperation from the people with whom we do business, the business cannot be sustained."

According to reports, during OpenGate Capital's ownership there was a 20-percent increase in sales. But those reports also indicated that as Golden Guernsey was suffering under the pressure to meet demands for lower-cost products, it was unable to successfully reduce its expenses in a way to achieve a state of financial viability.

Filing a complaint

Even so, under state law, employers with 50 or more workers must provide notice 60 days in advance of when 25 or more employees are affected by a business closing or 25 percent of the workforce is affected by a mass layoff.

Golden Guernsey workers are fighting back.

On Tuesday, the Wisconsin Department of Workforce Development received a complaint alleging the closure occurred without advance notification as required under the state's Business (Plant) Closing and Mass Layoff Law.

The complaint was filed with the agency's Equal Rights Division by Robert Storm Jr., of Burlington.

He said in his complaint that he believes "the wheels were in motion to close the plant" a month ago.

Responding to closure

In response to the closing, DWD Secretary Reggie Newson announced Monday initial steps the DWD and its regional workforce partner, Waukesha-Ozaukee-Washington Workforce Development Inc., are taking to assist affected workers.

"Clearly, the closure of the plant was unexpected for the employees and the Waukesha community, and the abrupt nature of the act is particularly troubling," Newson said in a news release. "We want the workers to know that we are here to support them and are working as quickly as we can to initiate services that will assist them and their families during this uncertain and difficult time."

The DWD and WOW have scheduled Rapid Response orientation sessions for workers in the WOW region on Jan. 16 and 17 at the WOW Workforce Development Inc., offices at the Workforce Development Center, 892 Main St., Suite A, Pewaukee.

Affected workers are asked to pre-register by calling (262) 695-8041. Additional details about each session, including available time slots, will be provided individually.

The Rapid Response services are part of the DWD-administered Dislocated Worker Program, which serves workers who become dislocated when a business cuts positions or ceases operations entirely.

While Dvorak, who is employed through C. Delsman and Sons Inc. in Waukesha, will no longer distribute for Golden Guernsey, his company will now distribute for Prairie Farms Dairy, out of Dubuque, Iowa.

And unlike when he was distributing for Golden Guernsey, which delivered to a number of grocery stores across a four-state regional area covering Wisconsin, Illinois, Minnesota and Iowa, Dvorak said he will now just distribute to local Aldi stores.

Searching for options

It will also mean a change for Fox Brothers Piggly Wiggly in Hartland, which sells Golden Guernsey milk.

"We were very surprised and shocked when I got the call on Saturday morning," said owner Pat Fox. "Our distributors came to get milk, but the doors were locked.

"They've been part of Waukesha County forever. There's great concerns for the farmers that sell Golden Guernsey products and with distributors; it was shocking to hear they were closing. We've heard absolutely nothing."

Fox said his Piggly Wiggly's (he owns six stores in the area) had enough milk over the weekend because his distributor picked milk up on Friday.

"We were fortunate because of that," Fox said.

And he said, luckily, he found a replacement with Dean Foods out of Sheboygan.

"We needed to find a way to keep serving the customer and taking care of our guests because milk sells at such a high volume," Fox said.

Fox added the closing leaves some uncertainty, as he has sold Golden Guernsey milk at his stores since he opened in the 1980s.

"For me, it goes back to 1985," Fox said. "It will be very different not having Golden Guernsey. The plant is Waukesha County, and now it's not there anymore."

It will be a big change for many people.

Clark Vilter, who owned a dairy farm in the Town of Merton for decades with his family and distributed milk to Golden Guernsey, had the same feeling.

Vilter's father, William, was elected to the Golden Guernsey Board in the mid 1950s and served for more than 20 years.

"It used to be almost like a family," Vilter said.

While Vilter has scaled his farm back and stopped distributing milk to Golden Guernsey in 2011, he still said "it was pretty sad" when he heard the plant was closing.

Recent new ownership

He recalled how Golden Guernsey started as a farmer-owned cooperative in Milwaukee in 1930 and how Golden Guernsey moved to Waukesha in 1955 as it continued to grow.

Greg Serres of the Merton Feed Co. said Golden Guernsey used to be a staple around here.

"Years ago, every farm had a Golden Guernsey sign, because that's who they produced for," Serres said.

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