Posted on November 22, 2011 at 11:49 PM
Wednesday, Nov 23 at 8:35 AM
(KMOV) -- It sounded like a great opportunity for new jobs in a small town. In May of 2008 a Minnesota businessman expressed interest in an empty building near the Sullivan, Missouri airport; there were big plans to build an aerosol factory that would someday produce up to 50 jobs.
Dennis Litz owned DAC Industries outside Minneapolis, he told News 4 he wanted to expand in Sullivan because it's known as a big aerosol area with similar employers. Litz requested a $500,000 tax payer funded loan to purchase "critical equipment necessary to fill current orders." The city approved the request, and gave Litz the money.
The funds were distributed by the City of Sullivan, but they were from the Missouri Department of Economic Development. According to a letter to the city Litz said, "Our current bank is unable to meet our funding needs for the growth and expansion DAC Aerosol requires in order to keep up with our current and projected customer orders."
After making three payments, DAC Aerosol requested a loan extension from five years to fifteen. After nine total payments, DAC Aerosol stopped paying on the loan. The City of Sullivan has since filed a lawsuit.
Dennis Litz hired Steve Moser to be the company's vice president. Moser told News 4 the factory was making between "30 and 45 thousand" dollars a month. Moser said he saw the invoices and they were paid in full. Dennis Litz told News 4 they "never made a damn dime." Moser said the factory was profitable until he was fired. He also told News 4 he didn't think Dennis Litz knew what he was doing.
After the factory shut down Dennis Litz filed for bankruptcy. In the bankruptcy documents it says, "Debtor has books of business, but former business associate embezzled from debtors business and altered books conceal embezzlement." Dennis Litz said, "There was a lot of thieving and embezzlement." Litz would not elaborate about who stole money. News 4 asked Steve Moser if he's convinced (the Litzs') ran out of money. Moser responded, "No, I'm not convinced whatsoever."
Litz told News 4 he's lost everything over the deal, including his retirement savings. Dennis and his son, Don, insist they did everything they could to make the business profitable, and place much of the blame for the business failure on Moser.
The former aerosol plant still houses "26 barrels of toxic waste" according to Jack Vines. Vines is the owner of the property, and says he thought Dennis Litz was starting a mold injection business, and had no idea they would be working with toxic chemicals. He says it could cost upwards of $1,000 per barrel to clean up the waste, and doesn't know what he's going to do with thousands of gallons of propane that remain on the site.
According to OSHA, they fined DAC Aerosol for numerous safety violations. The agency says $36,000 in fines remain unpaid.
According to the City of Sullivan, Litz still owes $7,500 for an unpaid utility bill.
Litz told News 4 he is broke, and if he had it to do over again he would not expand in Sullivan, Missouri.