ELLSWORTH — The sale of the shuttered waste-to-biofuel facility in Hampden is still scheduled for June.
Karen Fussell, board president of the Municipal Review Committee (MRC), made the announcement during an April 20 virtual town hall meeting.
The question remains whether that sale will be to the MRC, which set a stalking-horse bid of $1.5 million for the plant, or a third party.
Regardless, “The facility will indeed be sold this time,” Fussell said.
The future of the facility, which used new Fiberight-developed technology when it opened in mid-2019, has been uncertain after the previous owner, Coastal Resources of Maine, ran into financing issues and closed the plant down in May 2020. Subsequent sale attempts have fallen through.
Located on land and infrastructure owned by the MRC, the facility has been placed into receivership while the MRC seeks a new buyer for the $90 million facility.
During last week’s town hall, Michael Carroll, executive director of the MRC, estimated that the investment banker retained for the facility’s receivership had reached out to 20 potentially interested buyers, with about eight of them expressing more serious interest in purchasing the facility.
Multiple tours to the same, unnamed potential buyer have happened in the last few weeks, he said.
To gain access to information about the sale, potential bidders must sign non-disclosure agreements.
Carroll explained that preliminary bidder applications are due May 16. The MRC will screen proposals for their financial and technical capabilities before the receiver determines who is a qualified bidder on June 3.
Bids from qualified bidders are due June 7 and the auction date is set for June 14, leaving June 30 for the target date for closing on the highest bid.
Fussell added that the MRC thought there was a good chance a third party would purchase the facility.
However, Fussell said, if the MRC’s bid is the highest (or only) bid, the committee has enough funding to complete the purchase but will need to raise $20 million to successfully reopen the plant.
Fussell laid out two options the MRC could pursue to obtain that funding. The first – and preferred method – is that the MRC stays the sole owner of the facility, hires a contract operator and raises the necessary $20 million.
“In short, we would be the masters of our destiny in that case,” Fussell said.
The other option is for the MRC to bring in a private partner.
To secure the necessary funding for the preferred option, the MRC said it will need support from its joining members.
The MRC is proposing that member municipalities volunteer to be a guarantor and “co-sign for a portion of MRC’s loan or be an investor and loan cash to the MRC.”
Some sources of financing, such as grants and state and federal options, will not fit in the MRC’s timeframe for the sale, Fussell said.
Using American Rescue Plan Act funding has also been unsuccessful, she said.
A survey to members of the MRC indicated “there were more complicated factors” that members will have to undergo to be guarantors or investors, including legislative processes.
With that in mind, Fussell said the MRC will only request assistance from its members if it appears that the MRC will be the buyer of the facility.
A member of the meeting’s virtual audience asked when the plant would be reopened after the sale. Carroll answered that the new owner will have to ramp up and turn on the facility’s equipment and obtain appropriate staffing, but the facility could be fully operational at the beginning of 2023.