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It Takes Effort (and a Little Cash) to Make Quality Steel

By LVEDC Staff on September 3, 2014

Effort Foundry, incorporated in 1973, employs 85 people in Bath.

Effort Foundry, incorporated in 1973, employs 85 people in Bath.

While Pennsylvania legislators may have plugged one hole in the wall, there may be water leaking in another.

In an effort to produce a balanced budget in July, Commonwealth lawmakers balanced their ledgers in part by pulling $85 million from the Machine Equipment Loan Fund (MELF) and $95 million from the Small Business First Fund (SBF). Granted the procurement helped the Commonwealth solve a one problem, but the deductions have drastically reduced the potency of the MELF Fund and for all intents and purposes, closing to new applications. It has also affected applications that were previously submitted and determined to be quality projects, including one in the Borough of Bath.

Effort Foundry was incorporated in 1973, and is a manufacturer of complex configured carbon and stainless steel casting for use by several industries, including pump, valve, power generation, nuclear and defense.

“Our castings are made from sand molds, ranging in size from one pound to 2,000 pounds and are cast to meet any of the 150 metal specifications,” said Charles Hamburg, chief executive officer at Effort.

In some ways the company is at a crossroads: With ever increasing customer quality requirements and recent introduction of “additive manufacturing” directly into their niche in the marketplace, the company is faced with the proposition of transforming itself or losing a significant competitive advantage.

As such the company, which employs 85 people, submitted an application for $750,000 in MELF financing to assist in updating their manufacturing capabilities, including equipment, software and hardware, which will enable them to improve the efficiency of their operations in the following areas:

  • Simulation model parts in advance of being poured
  • Optically scan tooling to create 3D computer files
  • Track castings as they move through the manufacturing process
  • Significantly expand existing machining capabilities to improve quality, reduce risk, and add value
  • Upgrade their arc/burn department
  • Re-engineer and expand their molding, pouring and mold storage areas

With the upgrades, Effort Foundry expects over the next three to five years to generate revenues in the $1.5 to $2 million range.

“This project is also expected to enable Effort Foundry to move toward assimilating some form of 3D printing into its manufacturing process in the future, keeping them at the forefront of the industry,” said John Kingsley, LVEDC vice president of finance.

This comprehensive redevelopment of the company’s production process is expected to significantly enhance its technological capabilities and virtually provide assure that this industrial activity will continue in Bath and that the company’s 85 employees will be retained for the foreseeable future, with additional ones to be created to support the company’s continued growth.

All that may be for naught, however, as part of the company’s plan was predicated upon their ability to obtain low-interest financing through the MELF program.

“LVEDC worked with Effort Foundry for more than six months to develop this project and the company incurred significant expense to develop the strategic plan that is the crux of this loan request,” Kingsley noted. “This project is eligible for the MELF program, the company is eminently creditworthy, and the use of funds is exactly what we are trying to promote as economic developers.”

Kingsley noted an added incentive to see the company succeed.

“Effort Foundry is the last of a dying breed in the United States,” said Kingsley. “They both warrant and need our support.”

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