A retrospective section published a few weeks ago in the local weekly I write for reminded me of just how effective a small-town, non-daily newspaper can be. And it raised the possibility of my telling a story that ought to be heard far and wide. But you won’t find it without looking. It has to do with an heroic editor who uncovered an important story of the “Emperor’s New Clothes” variety and published it — even though it ultimately cost her her newspaper.
The town burghers in Moberly, Mo., were all excited in 2010. They were wooing a company that, the company said, would bring 612 jobs to the town of 14,000 in the center of the state. All they would have to do, local officials said, was float $39 million in bonds to finance the building of a plant, where the company, called Mamtek International, would produce artificial sweetener.
The State of Missouri chipped in, offering $19 million in tax incentives to the company. Apparently it was the state’s department of economic development that had steered Mamtek to Moberly in the first place.
It all seemed too good to be true, thought Janet Morales, editor of the upstart weekly The Moberly Mirror & County Observer. Rather than take the claims at face value, she did a little poking around. What she found was shocking.
For instance, the company claimed it had a plant in China already producing the sweetener, called sucralose, but, as she put it in her coverage, “CCM International, a market research firm in China, told The Mirror that no company by the name of Mamtek International exists in China.” There are sucralose makers in China, but no one in the industry had ever heard of Mamtek.
Nor could the company’s owners or other financial information be found. The owner was listed in some documents as a Los Angeles lawyer. Morales questioned local and state officials about it and “only the Missouri Department of Economic Development replied, saying the records were closed and the information could not be given.”
It all happened very quickly, just 73 days from proposal to document signing. There were lots of questions that apparently only Janet Morales was asking. Everyone seemed so excited about the new plant that no one wanted to rock the boat lest the company go elsewhere. The governor issued a news release, he was so pleased with the development. The city floated its bond issue and construction on the plant began.
The questions remained unanswered. Not the least of them was whether Moberly was falling victim to a swindle.
Janet Morales and her little newspaper sounded the alarm. The town did not thank her.
The local Chamber of Commerce, she said, began to pressure its members to withdraw advertising from the paper. Subscribers reported a whispering campaign against the paper from local merchants.
“Chamber Executive Director, Debbie Miller, who also sits on the board of Moberly Economic Development called me into her office,” Morales wrote. “She told me not to ask questions or Moberly could lose the Mamtek company.”
The Mirror’s revenues dropped off. It looked as if it would have to close — or else join the cheerleading for the new Mamtek plant.
“_The Mirror_ doesn’t have that many subscribers, relatively speaking, but they are loyal,” Morales said. “So we targeted our sales towards non-Chamber businesses.”
In a final act of defiance, Morales had an extra run of a special edition of the paper printed, and sent it to every home in Moberly. It detailed the suspicious things she had uncovered about the new plant and the company that was to move into it. Then the paper shut down.
And then …
On August 1, 2011, the bank underwriting Moberly’s bonds announced that Mamtek had failed to make its first $3.2 million bond payment. Nor had it started to produce anything at the plant. Moberly was — and is — on the hook for $39 million, for which it has a half-built plant to make artificial sweetener. Those who bought the bonds appear to be out of luck. The city is out of luck, too, its credit rating ruined.
The status of Mamtek — even the whereabouts (or, for that matter, identities) of its officers — remains unknown. Its former CEO apparently received $6.6 million of the bond money, however, through a shell company with a Beverly Hills., Calif., residential address.
There have been now hearings about it in the state legislature. The testimony has showed that Morales was right in every particular and that state and local officials were at least malfeasant if not flat-out criminally gullible. So much for the “show me” part of the Show Me State.
The officials still have their jobs, but Janet Morales doesn’t. She does, though, have the satisfaction of knowing that her little paper did the job that bigger local and regional papers should have done but didn’t.
In my estimation, she should have been awarded the Pulitzer Prize for distinguished local reporting.
Still, her coverage showed that you don’t have to be a big metropolitan daily newspaper in order to do good and meaningful reporting.
That alone is a lesson worth remembering.
Dennis E. Powell is crackpot-at-large to Open for Business. Powell was an award-winning reporter in New York and elsewhere before moving to Ohio and becoming a full-time crackpot. You can reach him at dep@drippingwithirony.com.