When American taxpayers bailed out General Motors, the company was split, with the best assets going to the reorganized automaker of the same name. This new General Motors is selling cars, making money and preparing a public stock offering.
The least valuable assets, including the run-down factories in Flint, were left in the shell of the old G.M., now named the Motors Liquidation Company.
This company has filed a bankruptcy reorganization plan that lays out how it will clean up and sell off the dozens of unwanted pieces of what was once the world’s largest automaker.
But the process is slow, and while plant closings have already cost jobs and tax revenue in many communities, the empty factories themselves are now becoming a burden.
“When General Motors closed shop in Flint, they just turned the lights off,” said Chris Swanson, a captain with the Genesee County Sheriff’s Department, which has made nearly two dozen arrests this year at the Flint North complex on charges of theft, assault with intent to murder and others.
Law enforcement officials say thieves have stripped tons of copper from the plants in Flint over the last year, but only last month, after shots were fired at an unarmed security guard, did G.M. hire off-duty sheriff deputies to patrol the area. Two nights later, someone fired at one of the deputies as well.
Fifty miles west of Flint, officials in Lansing Township have a different problem. They are still waiting for either company — G.M. or Motors Liquidation — to cart off mounds of rubble from two big plants demolished before bankruptcy. The sites are an eyesore, and an obstacle to redevelopment efforts, officials said.
“It has left us somewhat devastated,” said John Daher, the township’s supervisor.
Officials from Motors Liquidation would not comment for this article, beyond issuing a brief statement about their commitment to safety at the properties. “M.L.C. takes facility security very seriously,” it said. “In collaboration with General Motors Co., M.L.C. has over the past year taken many steps to ensure the security of the facilities it owns, including in Flint.”
The Motors Liquidation assets constitute the infrastructure of what could be a small automaker: four assembly plants, five engine plants and several factories that stamp out parts. It also owns warehouses, offices, parking lots and other real estate. Many of the properties are contaminated with industrial waste.
The biggest challenge for Motors Liquidation, the company said in its recent bankruptcy filing, is to fix the environmental problems so old facilities can be put up for sale. “It is nearly impossible to redevelop such properties for productive, job-creating purposes unless environmental remediation is complete,” said one executive, Ted Stenger.
The disposal of the properties is being financed by taxpayers in the form of a $1.17 billion loan made by the Treasury Department. Most of that money, $836 million, will go toward the cleanup of about 90 plants in 14 states. The bulk of that work should begin by early 2011.
None of the Treasury loan has been repaid, and payments are not likely to happen until the cleanup efforts are completed and more properties are sold, which could take years.
In the meantime, many areas face a long, barren period of minimal activity at idle factories.
Two of the closed assembly plants have found buyers, and a third, in Shreveport, La., will continue to make cars for G.M. until its shutdown in 2012. But the fate of other factory sites is less clear, and may not be decided until the court accepts the bankruptcy reorganization plan, which could take several months.