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July 30, 2008

Vermont Milk Co. Lays Off Two

News on the street this week is that The Vermont Milk Company, a firm launched in late 2006 by gubernatorial candidate Anthony Pollina, has laid off two employees — one permanently and one temporarily.

Dennis Myrick, who was hired by the company's board to run the dairy processor and help dig it out of debt, confirmed the rumors to Seven Days early today. The company still has about five employees and does hire temps from time to time, he added.

Pollina stepped down from the company at the end of last year as its vice president when he launched his bid for governor. The Progressive-turned-Independent originally claimed to have "run" the company on his campaign website, but when word got out that farmers were owed tens of thousands of dollars for the milk they had supplied, his website was changed to simply say he had been "on the board."

If this wasn't an election year, the company's troubles might simply warrant a mention on the business pages — another Vermont company hurt by high fuel prices. But, of course, Pollina is vying for the opportunity to oversee the finances of the entire state of Vermont.

Myrick, who once worked for the Vermont Republican Party, was hired on as a consultant for his business acumen, and has spent the past several months cutting costs, trying to boost income and keeping some of the company's creditors at bay.

Myrick said the company had substantial monthly losses at the turn of the year, some topping well into the high five figures. If you recall, those losses came at the time when Pollina was priming the campaign pump and soliciting $100,000 in donations and pledges.

The company has tightened its belt and in June lost just $9,000, but it still owes vendors money.

"There are always people breathing down our neck, and we’re in the process of a work out," said Myrick.

Part of that process includes getting a better handle on the company's fixed costs and improving its sales. Both, he said, were difficult to parse when he first came on board.  The company has received six-figure support from outside investors, some of whom are now on the firm's board of directors.

"As of this week, we’re not able to pay on the back debt and we need to have more on the bottom line and have to pay more of our debt service," said Myrick. If that can't happen, then they made need to make more cuts or figure out ways to improve distribution.

"We need a cash injection and we need to monitor our costs and we need to keep producing," said Myrick. "If any one of these things interfere with where we are, that will affect where we’re going."

Stay tuned. I'll have more on the Vermont Milk Company and its travails in next week's "Fair Game."

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