PSC recommends final payment in grain company insolvencyThe North Dakota Public Service Commission voted Thursday to recommend payment to the last remaining party with a claim against the insolvent Falkirk Farmers Elevator.
By: Mike Nowatzki, Forum News Service
BISMARCK, N.D. — The North Dakota Public Service Commission voted Thursday to recommend payment to the last remaining party with a claim against the insolvent Falkirk Farmers Elevator.
The PSC voted 3-0 to recommend that a judge award about $461,000 to St. Hilaire Seed Co. of Mentor, Minn. If approved, the payment will close the insolvency case, Commissioner Randy Christmann said.
Falkirk Farmers Elevator was declared insolvent Oct. 12, 2012, after failing to pay for grain delivered. The elevator had closed in April 2012, and elevator members voted that June to liquidate its locations in Falkirk, about 40 miles north of Bismarck, and Hazen. Some customers lost access to large amounts of fertilizer they had purchased.
Last December, the PSC approved payments to seven parties who had credit-sale contract claims against the insolvent grain company.
Under state law, the seven parties with total claims of just under $280,000 were eligible to receive 80 percent reimbursement from an indemnity fund. They received a total payout of $223,054.
“This insolvency ended up bringing people pretty close to being whole,” Commissioner Julie Fedorchak said.
The PSC had separated the claims against the indemnity fund from St. Hilaire’s claim against the trust assets because issues related to the trust claim were part of a federal court case and were expected to take longer to resolve.
St. Hilaire originally filed a $1.7 million claim, but it filed an amended claim of $486,988 on Aug. 19. The PSC is asking McLean County District Court, which must approve the payment, to determine that St. Hilaire’s valid claim is actually $495,795.
To arrive at the $461,000 recommended payment for St. Hilaire, the PSC liquidated grain assets valued at $7,000 stored on behalf of Falkirk Farmers Elevator at an unlicensed facility in Cummings, N.D., as well as grain assets valued at $71,507 stored at the Falkirk facility. Those funds, along with a $2,000 outstanding accounts receivable from a grain sale, were deposited into a trust.
The PSC on Thursday approved the trustee’s recommendation to use those funds and Falkirk Farmers Elevator’s $380,000 licensing bond, plus interest it had earned, to pay St. Hilaire 93 percent of its claim. The Falkirk grain elevator was purchased in September 2012 by SRS Commodities of Mayville, N.D.