09/26/2024
The Union Leader hopes to raise $4 million in investment capital, money that will be used to shore up management pensions while Guild members experience stagnant wages and benefits for more than a decade, according to company documents shared with potential investors.
The New Hampshire NewsGuild received copies of the documents this summer.
They dispel any notion that the Union Leader will grant significant raises once it becomes profitable.
Here are three numbers that show what's going on.
$4 million
That's what the Union Leader wants to raise. A public agency, the New Hampshire Business Finance Authority, will provide a 2%, 5-year loan of $1 million if the company can raise $3 million through private financing. The Union Leader is offering investors either stock or debenture financing.
Documents make no mention of investments in training, equipment or repositioning the company. The documents reflect a single goal: reduction of the company’s legacy debt.
$900,000
That's how much the company must pay out every year to cover its legacy obligations, what it calls an "existential priority."
A significant part of that is pensions for executives and managers. Unlike the Guild pension plan, the company never properly funded pensions for non-union workers, even during prosperous times.
Other legacy obligations are employee severance and payments to pension funds of unions that represented workers in disbanded departments such as the distribution center.
With the financing, the Union Leader would pursue debt forgiveness, lump sum payments and a reduction in benefits.
However, one sentence in the documents reads: "Legal counsel advises that no beneficiaries of these three pensions (plans) will see a reduction in their benefits as they all receive an amount below the maximum cap."
We've already disclosed that retired executives receive hefty payments: $114,000 for Joe McQuaid and $76,000 for John MacKenzie.
12 years
The Union Leader provides a 12-year financial projection to potential investors.
Those projections see good years ahead for the company. The company's bottom line -- the net profit -- goes from a loss of $472,000 this year to a small profit next year and a $1.01 million profit by the 12th year.
Workers don't fare so well. Company expenses, which includes Guild salary and benefits, drop slightly in the first three years and then remain stuck at $13.4 million for the remaining nine years.
Another indication of wage stagnation is the New Hampshire Business Enterprise Tax, which taxes company payroll. It remains stable at $24,280 throughout the 12 years.
To sum it up, their $4 million in financing translates into:
No actual reductions in executive and management pension benefits.
Growing profits.
No money for raises or benefit increases.
