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THE CITY REBORN FROM THE ASHES OF AMERICA'S MOST DISASTROUS FOREST FIRE
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Propane Shortage Easing, Still Hurts

Issue Date: February 12, 2014

The propane shortage continues to be a worry for many Marinette and Oconto County residents, but help seems to be coming from all sides, and Gov. Scott Walker is seeking action to make sure it never happens again.

Marinette County has been identified as having the worst propane problem in the state, but Oconto County has also had its share of trouble. Unconfirmed reports were received that some propane dealers were not honoring their contracts and were charging $7 to $8 pr gallon. Complaints reportedly were submitted to the state and the next day the price was down to $3.30 per gallon.

Marinette County businesses affected by the shortage are asked to report their losses by calling 715-732-7660. Calls reporting loss of heat, lack of ability to provide a service, inability to pay the increased propane price, or failure to find a dealer will help with efforts to secure Small Business Association (SBA) loans to help deal with the issues. Some businesses, particularly restaurants in the northern part of the county, have been only half days to conserve their propane supply.

The cold winter and high prices are hitting most area residents hard in the pocketbook. Marge Banaszak, manager of the Crivitz Area Food Pantry, said they served 125 clients on its Wednesday, Feb. 5 distribution day. Many who came for food had never been there for a long, long time and others had never, ever been there before.

They’re getting hit between the Public Service bill and the gas bill, and they don’t know which way to go, she said, adding some struggle to make ends meet on less than $1,000 a month.

Steve Sargeant, General Manager of Lakes Gas Company said at least four rail cars full of propane came into their Crivitz terminal last Wednesday night and more are on the way.

Truck hauling abilities have improved also, he said. Changes in regulations have made it easier for drivers to get in and out of distribution centers so they can come back with another load.

Lakes Gas is taking new customers, and their trucks are now filling tanks to capacity. Prices are still high, but not as high as they were. Sargeant predicted the crisis should end in March.

State Representative John Nygren of Marinette said Monday, Feb. 10 that he has received numerous phone calls and e-mails from constituents who are understandably concerned with the fuel shortage. Nygren said like many legislators from rural areas, he has been in constant contact with Governor Walker and the propane industry, seeking solutions to the propane problem.

 One suggestion was to ask the federal government to help route more propane up to the Midwest region. The Governor met with some of the president’s advisors regarding the propane situation recently. He also was part of a letter sent from the Midwestern Governors Association that requested to explore every possible action to help increase propane supplies to our region, Nygren said. 

We are thankful to the Federal Energy Regulatory Commission that acted on a request for the increased flow of propane coming to the Midwest, said Nygren.  Please know that we will continue to work to find ways to ease the burden of increased propane prices.

The Wisconsin Housing and Economic Development Authority (WHEDA) is making it easier for small businesses to obtain fuel by expanding its $3 million Propane Guarantee Program created last week specifically for propane dealers following Governor Walker’s declaration of a State of Emergency.

Under the expansion, existing small businesses would also be allowed to apply to purchase propane or propane equipment.  The application and approval process is being streamlined to help businesses make purchases more quickly.

We are doing everything possible to ensure that Wisconsin residents can get propane in their tanks, said Governor Walker.  While there is no silver bullet that will fix the current propane crisis, my administration has been moving forward with initiatives aimed at helping residents across the state keep the heat on during this bitterly cold winter.

This is great news, said WHEDA Executive Director Wyman Winston.  In addition to propane dealers, many small businesses have contacted WHEDA requesting assistance to purchase or pay for propane.  Some of those businesses have informed us they may have to cease operations until propane prices fall. WHEDA is very pleased to put in place this expansion to help our small businesses address the current crisis and remain open for business.

WHEDA is taking on greater risk because it will be providing loan guarantees to businesses across a spectrum of industries.  To mitigate the additional risk, the guarantee will be limited to the lesser of 50 percent of the loan amount or $25,000 per borrower.  The borrower will also be required to sign a personal guarantee.  The lender will share at least half the risk on the loan, thereby limiting the number of high risk loan guarantee applications that are submitted.

Changes to the Propane Guarantee Program, including the expansion, were approved last Friday by WHEDA’s Internal and Members Loan Committees.

Similarly but separately, at the request of Governor Walker, the Wisconsin Economic Development Corporation (WEDC) recently began working with financial institutions to encourage them to create or expand lines of credit of up to $100,000 to propane dealers during the current propane crisis.

Beyond just the efforts at WHEDA, on Monday, Jan. 27, Governor Walker and cabinet members met with representatives of the propane industry.  By the end of the day, another program through WEDC had been fully developed and approved by the WEDC Board of Directors at an emergency meeting.  As a result, by the end of last week, WEDC had received more than 100 inquiries about the program.

 Not only is this program one of many steps taken by Governor Walker to provide relief in this crisis, it is also an example of how WEDC can utilize its unique authority to allocate funds to quickly respond to the needs of the business community, said WEDC Chief Executive Officer, Reed Hall.

 For more information on the programs can be found at www.inwisconsin.com. and www.wheda.com.




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