PORT ANGELES — The City Council has delayed taking action against Peninsula Plywood, which owes the city $279,419 in delinquent utility bills, because several council members hesitated over waiving PenPly’s interest and penalties.
Port Angeles city staff had proposed forgiving the $19,155 in late-payment fees accumulated to date.
But Mayor Dan Di Guilio objected to waiving the fees, saying the city has already “bent over backwards” for the company.
“To me, it’s just not fair to the rest of the utility payers who would be charged if they were late on their utility bills,” he said during the council’s Tuesday night meeting at City Hall.
During the council discussion that followed, Councilwoman Brooke Nelson proposed forgiving only a portion of the fees, and Deputy Mayor Don Perry said he would support waiving all fees accumulated since the city sponsored a $500,000 grant for the company.
The council endorsed the grant, awarded by the state Department of Commerce, four months ago. The grant was meant to save the struggling company by giving it funds to buy materials and cover other operating expenses.
Perry’s proposal appeared to gain the support of the rest of the council, including Di Guilio. The council voted unanimously to have the terms of the payback plan renegotiated with PenPly.
PenPly has been current in its monthly utility payments to the city and rent payments to the Port of Port Angeles for the past two to three months, according to both public entities.
But the company still owes the port $82,783 and has yet to produce a payment plan, port Executive Director Jeff Robb said.
The port requested one in July, he said, and PenPly President Josh Renshaw told him about two weeks ago that the company is still working on it.
Renshaw did not return several requests for comment Tuesday and Wednesday.
Robb said he expects a proposal soon after the company finalizes its payment schedule with the city.
“It’s a tough place for them,” Robb said, adding that the company is still trying to become financially stable. “I think he [Renshaw] will do that.”
Grant Munro, one of PenPly’s investors, said Wednesday that it’s “still pretty difficult” at the mill but referred additional comment to Renshaw.
The late payments come with a 1 percent interest rate, Robb said.
To receive the grant, PenPly’s investors had to contribute an additional $700,000.
In July, the mill had boosted production from 1.3 million square feet a month to 3 million feet and had hired 30 new workers.
That expanded its workforce to about 130.
PenPly also made a $50,000 payment on its delinquent bills to the city as required by the grant.
The mill cut employee pay by 10 percent in May.
Managers took the same cut last November, Renshaw has said.
PenPly reopened the mill in March 2010.
It was shuttered by its former owner, Klukwan Inc. of Alaska, in November 2007.
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Reporter Tom Callis can be reached at 360-417-3532 or at tom.callis@peninsuladailynews.com.
