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Without key federal tax incentive, demand for wind turbines falls

(Monday, Sept. 13, 2004 -- CropChoice news) -- Cara Pesek, Lincoln Star-Journal, 09/10/04:
One Fairbury business has stopped production and another has delayed plans to move into the city's industrial park.

Crossroads Building Products Inc., which manufactured a plastic alternative to plywood and other plastic building products, stopped production at its industrial park plant last month, said James Frager, executive director of Jefferson County Economic Development.

Meanwhile, Windmills of Holland, which makes wind turbines that generate electricity, has put on hold plans to build a plant that would employ at least 160 people, said the company's senior vice president, Gene Cornett.

The windmill company's decision is related to the demise of federal incentives for wind energy, Frager and Cornett said.

Crossroads began churning out synthetic plywood, rails and fencing this spring.

In August the company stopped production and laid off all of its employees, Frager said, but how many was unclear. The company had said it planned to employ 27 people.

Attempts to reach company officials Thursday were unsuccessful.

Frager said he expected the company to start production again - either with new management or different owners.

"I don't think we're going to lose the company," he said. "It's just they're going to be reorganized."

Frager said the company suffered from lagging sales and poor marketing.

Crossroads was to receive about $3 million in incentives from Jefferson County, the state of Nebraska and the city of Fairbury for locating its plant there.

The company was started by Wayne Whiteside, a former executive of Owens Corning - a Fortune 500 company whose products include vinyl siding and insulating materials.

Frager said the Crossroads closing and the Windmills of Holland delay hasn't hurt Fairbury's industrial park, which also houses McBattas Packaging and Printing and Prairie View Industries, a company that makes aluminum wheelchair ramps and other products.

"We have about five other projects we're working on for the industrial park," he said. "We're not short on projects to the future."

In early February, Windmills of Holland said it would build in Fairbury. At the time, company officials said they expected the plant to be up and running by early or mid-2005.

On Thursday Cornett said the company still planned to move to Fairbury and to create at least 160 jobs.

But a governmental glitch has put plans on hold indefinitely, he said.

The company is waiting until the wind energy production tax credit is reinstated. The credit, which the federal government established in 1992, gives tax breaks to wind energy farms during their first 10 years of operation.

The tax credit expired at the end of 2003, according to the American Wind Energy Association.

Bills have been introduced in the House and the Senate to extend the tax credit, but neither has passed, Cornett said.

Since the tax credit expired, demand for wind turbines has dropped, he said.

The company doesn't want to begin production, he said, until the credit is reinstated - something he said he is confident will happen, though likely not until next year.

"We don't want to come in and have what we call a false start," Cornett said.