SHENANDOAH, Iowa — Consumers who bought residential wind generators from a troubled Shenandoah firm apparently are out thousands of dollars as the company made its last shipment Monday before permanently closing.
Steve Stultz, chief operating officer of Prevailing Power, vowed earlier this month to remain open despite a failed business deal in Colorado Springs, Colo., and consumer complaints filed with the Iowa Attorney General's Office.
Prevailing Power employees, interviewed at the plant Monday as they loaded steel towers onto trailers, said the business would close after their deliveries.
Stultz was not at the company warehouse and did not answer phone calls seeking comment.
In a letter he sent to customers last week, a copy of which The World-Herald obtained, Stultz blamed his company's faulty wind generators on defective parts produced by a Chinese factory. Customers' deposits “were locked up in other orders” and couldn't be refunded, he said in the letter.
“This has devastated our company and we are financially unable to survive,” the letter stated. “We are deeply sorry for this situation but it is out of our control.”
Stultz and his wife, Pam, were denied a loan by the City of Shenandoah when they opened Prevailing Power less than a year ago, said Greg Connell, executive director of the Chamber of Commerce, who conducted a background check on the couple.
“We did not recruit Prevailing Power to open here, and we never would have,” Connell said Monday. “We work very hard to have this community thrive through entrepreneurs and hard work.”
The Stultzes filed for Chapter 7 bankruptcy, which involves liquidation of nonexempt assets, in Branson, Mo., in 2005. According to court records, the couple owed more than $813,000 on businesses they owned, including the Branson Pit Stop, Hilltop Food & Fuel, Flashbacks and Steven's Auto.
Max Haidsiak, a former Prevailing Power employee, said most of the 12 company employees who built wind towers, installed turbines and wired the electrical components lacked formal training in electrical work or in wind generators. Employees learned on the job from other workers, he said.
David Terry of Clive, Iowa, is among the customers affected by the company's closing.
In mid-February, Terry said, he wired $8,000 to a Lincoln bank as a down payment after meeting the Stultzes at the Des Moines Home and Garden Show. Terry said he exchanged phone calls with Steve Stultz and Prevailing Power employees about possibly getting a refund but hadn't heard anything lately.
“I believe in wind energy,” Terry said. “My wife and I wanted to build a house and live with this for the rest of our lives.”
Tammy Brunk and her husband, Doug, who own Equine Veterinary Associates in Grand Island, Neb., bought a generator from Stultz in December 2008.
No equipment was installed until July 2009, Tammy Brunk said. The tower and generator finally were erected last August, but no electrical work was ever done, so the unit doesn't work, she said.
“We have a lawn ornament.”
A spokesman for the Iowa Attorney General's Office views Prevailing Power as “an apparent business failure” and doesn't plan to formally investigate, despite having received about six complaints.
“In a business failure, creditors such as vendors and consumers who paid for items but did not receive them may have private legal claims they can consider with their own attorneys, or a bankruptcy court could be involved in the matter,” Bob Brammer said in an e-mail.
Contact the writer:
444-1414, ross.boettcher@owh.com
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