Farmers vote to liquidate Falkirk ElevatorsMembers of the Falkirk Elevators — stations at Falkirk, N.D., and Hazen, N.D., — gathered June 25 in the basement of the Memorial Hall building in Washburn and voted 88-1 to liquidate the elevators, ending nearly 100 years of grain house history in both locations.
By: Lauren Donovan , The Bismarck (N.D.) Tribune
WASHBURN, N.D. — Farmers joked that it was the first time there was no supper served at the grain elevator meeting, but it was pretty slim pickings to bring to the table.
Members of the Falkirk Elevators — stations at Falkirk, N.D., and Hazen, N.D., — gathered June 25 in the basement of the Memorial Hall building in Washburn and voted 88-1 to liquidate the elevators, ending nearly 100 years of grain house history in both locations.
Some members demanded the elevator board also move quickly to dissolve the elevator and give them a say in how assets are distributed.
“If they wait three months for dissolution, I can guarantee the money will be gone,” said Hazen attorney Greg Lange.
Lange represented a group of Hazen area farmers who are out more than $1 million in payments for spring fertilizer and seed they never got because that money was grabbed by CHS to cover its loan to Falkirk.
The abrupt end followed startling news in April that an audit found the elevators owed more in loans than they had in grain and cash — a negative working capital of about $3 million.
The audit was conducted by CHS in preparation for a merger with the Garrison elevator. Instead, the merger was halted and CHS claimed cash accounts, including money paid in advance by farmers for spring delivery of fertilizer and seed against its loan of $5.4 million.
The elevators are still in debt to the tune of about $6 million, besides owing farmers from Hazen and Falkirk $2.1 million and various vendors $1.3 million.
The farmers might get paid back some of what they’re owed, depending on the liquidation of the elevator buildings and equipment, scheduled for June 30.
Elevator members might have joked about supper, but there was little else to laugh about. There were a lot of grim faces in the room and tough questions about how the elevator could slide so far, so fast.
One member said he wanted to hear from CHS and former manager Ron Hefta. “They know what the hell happened and they’re not here,” he said.
Another voice from the Hazen side of the room wanted to know about that elevator’s future.
“You put all that money into improvements (at Hazen) and now you’re going to sell it to a frack sand (fracture treatment) company?” he asked.
Hazen area farmers were granted a court injunction that they said forced the elevator board to publicly tell members what was happening and let them vote on whether to liquidate.
Lange said members wouldn’t have been told anything or even have voted, without the injunction.
The board’s attorney, Lowell Bottrell, said the board had already set a date before the injunction and overrode a Hazen producer’s loud assertion that that was a falsehood.
Bottrell said liquidation is the quickest means to resolve the elevator problems and that a Chapter 11 bankruptcy wouldn’t work because the elevator isn’t financially viable.
“Every time you go into bankruptcy, farmers lose,” he said.