Nearly 21 months after Tacoma’s Precision Machine Works sold to a Colorado firm, the company’s employee-owners are finally getting paid for their shares in the aerospace parts maker.

The payouts, which averaged $167,000 for the 135 or so eligible workers, were held up by the slow pace of the Internal Revenue Service’s review of the sale.

“The IRS has something like five people who review these things, and it just took them a long time to get to us,” said David Baublits, Precision’s chief executive officer.

Platte River Ventures closed the sale of the company in February 2007, and funds from the sale were deposited into trust accounts. Employee owners received one third of their expected share of the buyout in 2007, but the remaining two-thirds of that amount was withheld pending the IRS approval.

The company, founded by Ed Gazecki in 1925 to make custom wood-working machinery, now produces high-tech metal aircraft parts. Its principal customers are Boeing and its European rival, Airbus.

Precision became employee-owned in 1989. Its employees were awarded stock in the company annually based on their salary. Veteran workers had accumulated as much as $550,000 worth of the stock.

Janie Pierce, Precision’s human resources director, said letters have been mailed to the former employee owners, both active and retired, explaining their options. Those employees can either roll over their share of the purchase price into a tax-sheltered retirement account such as a 401K or Individual Retirement Account or take a cash payout. The cash payout, however, will trigger federal tax penalties.

Pierce said many employees have already submitted replies to the company’s letters. Precision is distributing the money according to their wishes as soon as possible, she said.

The company has made a great effort to communicate the status of the payouts to employee owners, said Pierce, even as the process dragged out over many months.

The IRS reviews the transactions to see that the employees are being treated fairly and that the fees charged by the banks and attorneys handling the transition are reasonable.

The final payouts will be slightly larger than originally projected because few unanticipated expenses emerged during the review process.

Some employees told The News Tribune that they were unhappy that the money distribution had taken so long to accomplish.

“People were counting on this money,” said one employee who declined to be identified. “It really messed things up when it was delayed.”

Baublits said the company had warned employees that the process of gaining the IRS approval of the transaction could be a lengthy one.

“There are always a few people who don’t hear when we tell them that it could be awhile,” said Baublits. “But most people understand that we didn’t control the pace of the approval.”

John Gillie: 253-597-8664

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