End of the line: Country Coach RV to be liquidated
JUNCTION CITY, Ore. -- It's the end of the line at Country Coach.
A federal bankruptcy judge ordered the RV manufacturer convert from Chapter 11 proceedings to company enter Chapter 7 liqudation and sell off its assets to pay back an $8.5 million loan to Wells Fargo.
This comes one month after Judge Albert Radcliffe allowed Country Coach more time to reorganize over the objections of an attorney for the U.S. Trustee, who pointed out Country Coach had continued to lose money since reopening in April.
At the October hearing, company officials acknowledged they had failed to meet sales and production goals but were confident they could emerge from bankruptcy with the help of investors.
Radcliffe gave the investor a deadline to deposit $1 million into a Wells Fargo account last week, according to federal court documents. After the investor missed the deadline, Wells Fargo asked to covert the case to Chapter 7.
Wells Fargo is not the only company owed money.
Several businesses in Junction City say Country Coach has unpaid bills with them, although all the business owners KVAL spoke with declined to name the amount.
"I really can't say. Quite a bit. I just have to bite the bullet like everyone else," said Kenny Jamieson, owner of Junction City Muffler Shop. "I'm pretty sure I'll never get the money back."
It's a sad time, Jamieson noted. His father started doing business with Country Coach when the RV maker opened 35 years ago.
"Every motor home made in this valley, including Monaco had our generator system and our heating systems on it," said Jamieson.
He added 40 percent of his business disappeared when Country Coach stopped production. That includes out-of-town visitors who stopped in Junction City to visit the RV manufacturer.
Many businesses Junction City can tell a similar story. When the town became a mecca for RVs, people drove to Junction City to have their coaches serviced. But when RV sales dried up, victim to high gas prices and the recession, those visits stopped.
The craftsmen stayed behind, although not every business survived.
"There's a lot of able-bodied people here to build, fix, repair coaches," said Matt Rossiter, owner of Innovative Coachworks. "We need something to draw them into this area."
Rossiter says his building used to be home to two other coach-related businesses. Now his satellite TV installation company is the only one left.
Country Coach represented around 10 percent of Junction City's tax base, according to city manager David Clyne. While most of that will go away, the city will still collect taxes on the land and buildings. Country Coach was leasing the property from another company.
"The loss of revenue will be an impact on our budget," said Clyne. He did not know how much tax money the city would lose.
Clyne said other manufacturers had expressed interest in the property, which is located near Highway 99 and has railroad access.
However, he says the city hopes to diversify its industries.
"Our reliance on the RV industry, it's become very clear in last couple of years, it's not going to work for future economy for the community," said Clyne.
Clyne says the city is focusing on construction of a state prison and state psychiatric hospital slated for the area, as well as agriculture and agriculture tourism.
KVAL contacted Matt Howard, Country Coach's Director of Marketing, on Monday. When asked for comment, he said he was no longer an employee of Country Coach and did not have a comment.
