Idle Ohio ethanol plant struggles to restart, repay loans

By Holly Jessen | October 20, 2011

In February 2008 Coshocton Ethanol LLC began producing ethanol in Coshocton, Ohio, with high hopes of a profitable future. Just a few months later the 60 MMgy ethanol plant idled when it was no longer economically feasible to continue producing ethanol.

Efforts to restart the plant have, as of yet, remained unsuccessful. And now, the clock is ticking on the plant’s obligations, such as its commitment to provide 41 jobs with wages of at least $15.90 as well as loan repayments to the city and Coshocton Port Authority.

Although Altra Biofuels, which owns the plant, didn’t respond to requests for information, Coshocton Port Authority Executive Director Dorothy Skowrunski confirmed the company is working to obtain financing to restart the plant. “It’s been a pretty slow process,” she said, stressing that the Port Authority is doing everything it can to help the company. “It’s our job to help them get up and running,” she said. “It’s our job because of the good paying jobs. It’s important to our economy and we want to be as supportive as we possibly can.”

In the meantime, the City of Coshocton has filed a civil lawsuit against the ethanol plant and former plant President John. A. Baardson, attempting to collect on loan payments and other fees. The city entered into an agreement with the ethanol plant to take out a $7 million loan for water and waste treatment upgrades needed for the plant, according to court documents. The money was borrowed from the Ohio Water Development Authority and the city is responsible for 30 percent while the ethanol plant is responsible for 70 percent, said Sherry Kirkpatrick, city auditor.

The plant has not made a $25,000 monthly payment for more than 18 months and is about $370,000 behind. That total also includes wastewater and pretreatment fees, as well as the loan repayment, she said. Both parties have until Nov. 28 to prepare to answer questions, such as whether the case should be heard by jury trial or bench trial.

The plant is also behind in loan repayments to the Port Authority. This is for repayment for a $500,000 loan from the Ohio Department of Development. Once the loan is paid off, the ethanol plant will own an electric substation and 14.5 acres of land adjacent to the ethanol plant, which the company is currently leasing from the Port Authority, Skowrunski said. Beginning October 2010, a five-year grace period expired and the ethanol plant was supposed to begin paying $5,000 a month. However, the Port Authority received approval for an extension, the timeline of which Skowrunski declined to provide. “We’re pretty much just waiting right now for them to get up and running,” she told EPM.