Siletz.Net

In response to questions from Lynette Warren at the November 3rd General Council Meeting, Tribal Chairman Delores Pigsley revealed that Siletz Aeroteam is not profitable in Ohio and that it would not be profitable to move the company to Oregon at this time. She seemed to admit for the first time that Siletz Aeroteam may not be coming to Oregon at all. She said that the tribe was having difficulty getting 8A certification and that without such certification the company might never be profitable.

The plan to move Siletz Aeroteam to Oregon is already more than a year behind schedule. Last year Gregg Gubuan announced in the Nesika Illahee that the tribe expected to break ground for Siletz Aeroteam on the Dundas property in October 2006 and begin manufacturing operations there in January 2007. None of this has happened, in fact the Dundas property is now being developed for another project and the tribe no longer appears to have a site planned for Siletz Aeroteam.

At the General Council Meeting in February 2007 tribal leadership touted Siletz Aeroteam as the top priority for the Siletz Tribal Business Corporation in 2007 (The second priority announced for STBC this year was River Reclamation Group. RRG was shut down in April and later dissolved.)

Jeff Maag of US Aeroteam made an enthusiastic sales pitch to tribal members at the meeting. Maag told the tribe that US Aeroteam had a great business and there was no reason that this success could not be reproduced in Oregon. The plan was to build one of the first Native American manufacturing facilities in the northwest for the Siletz tribe. This would create many careers in skilled trades for local tribal members. The influx of jobs and capital was supposed to help extend the infrastructure of the tribe, the schools, the clinic doctors, roads, and to create many other opportunities. He said that Siletz Aeroteam and US Aeroteam would grow, become intertwined and become one company.

It was a nice sales pitch but not much of it has come true, and it looks like not much of it ever will. The tribe sent four trainees to Ohio, three of them left shortly. Only one trainee remains in Ohio.

On the other hand the partnership has worked very well for US Aeroteam which was rescued from bankruptcy by the tribe. The tribe loaned US Aeroteam $1.8 million dollars and also contributed $900,000 of capital to Aeroteam Acquisition Corporation. AAC was owned by the tribe but managed by Suhas Kakde, who now owns 80% of US Aeroteam. Tribal Council reports that the loan is being repaid, but it's unclear what equity or return the tribe now has for the $900,000 infusion of capital. Siletz Aeroteam has apparently been losing tribal money as long as it has been operating.

The biggest return on this investment for the tribe was always supposed to be the establishment of Siletz Aeroteam in Oregon.

It's unclear why the tribe that can get laws passed in Congress is having trouble getting 8a certification, or why problems so pivotal to the investment were not foreseen. This is the first time the tribe has been told that the viability of Siletz Aeroteam depended on 8A status. And the certification process typically takes 18 months anyway - we know that the tribe intended to move Siletz Aeroteam to Oregon before it had 8A certification. So what's happened? I think the issue of 8A certification is now being used as a smokescreen, a convenient excuse for tiptoeing away from another major failed investment.

At the August General Council Meeting, Lynette Warren predicted that Siletz Aeroteam would never come to Oregon. This prediction was omitted form the minutes but can be seen on the DVD recording of the meeting. It's a cinch that Lynette's prediction will turn out to be correct now that Tribal Council is downplaying the future of Siletz Aeroteam.