By Dana Hedgpeth
Washington Post Staff Writer
Friday, June 12, 2009
WILMINGTON, Del., June 11 -- Delaware politicians and auto union leaders pleaded Thursday with President Obama's director of recovery for auto communities and workers for help with unemployment payments, health-care benefits and retraining as plant closures cost residents their jobs.
Gov. Jack Markell (D) said after a 2 1/2 -hour, closed-door meeting that state officials asked Ed Montgomery to come and discuss the state's challenges.
Montgomery's visit comes almost two weeks after General Motors said it would shutter a 60-year-old plant in Wilmington that makes the Pontiac Solstice, Saturn Sky and Opel GT. The closing, in late July, will put roughly 1,100 people out of work. That comes on top of 700 Chrysler workers who lost jobs in December when a plant in Newark, Del., about 15 miles away, closed. Plus, the state has been hit hard by troubles in the financial industry.
"What's made it tough for Delaware is that you have the auto industry on the one hand, and at the same time the other backbone of our economy was the financial services sector, which also has been in a lot of turmoil," said Matt Denn, Delaware's lieutenant governor. "It is sort of the perfect storm as far as Delaware is concerned."
Delaware's unemployment rate has doubled in the past year to 7.5 percent, and the state faces an $800 million budget shortfall. Over the years, other East Coast areas have been hit by the auto industry's troubles as plants in Baltimore and, more recently, in Fredericksburg, have also closed or are expected to close. Fredericksburg faces one of the highest unemployment rates in the region, at 9.4 percent, and the Baltimore area's is 7.1 percent.
In Delaware, Montgomery heard stories of autoworkers struggling to pay mortgages, bills and children's college tuitions after being laid off, according to the governor's staff. He pointed to a program that the Treasury Department announced Thursday that will expand a tax break on new car sales to six states, including Delaware, that don't have sales taxes.
"The president understands the importance of the auto industry to the economic life of America," Montgomery said at a news conference after the meeting. He said the plant closures and downsizing of auto companies in Delaware and elsewhere means "there are residents who are hurting."
Since Obama appointed Montgomery in late March to help auto-dependent towns deal with the impact of the faltering industry, he has been on a roadshow, meeting with union workers, business people and community leaders in such places as Indiana, Ohio and Michigan to try to facilitate the flow of federal dollars to laid-off autoworkers and their communities.
While Delaware leaders said they are hopeful that Montgomery can guide them to federal aid to retool for green energy businesses, they realize the economic environment is tough.
"It is apparent that they're moving production to the middle of the U.S.," Alan Levin, secretary of Delaware's economic development department, said of the auto companies. "There won't be any manufacturing on the East Coast. You're taking away an industry with a skilled workforce that was making very good wages, and now they're forced to go find other careers."
Staff writer Kendra Marr in Washington contributed to this report.