Deal keeps South Dakota elevator alive; state renews grain buyer license
The Roslyn Elevator and US Bank presented an agreement to the South Dakota Public Utilities Commission to keep the business going. The PUC voted June 29, 2022, to renew the elevator's license.
PIERRE, S.D. — The financially troubled Roslyn, South Dakota, grain elevator will continue to operate after reaching a deal with its bank and having its state license renewed.
The South Dakota Public Utilities Commission on Wednesday, June 29, voted to approve the grain buyer license for the Roslyn Elevator. The vote came after commissioners were able to review a forbearance agreement that will keep U.S. Bank from foreclosing on the elevator until at least July 29.
That agreement can be extended if several conditions are met, but it also hinged on the renewal of the grain buyer license that was set to expire on June 30.
One condition will be the elevator hiring one of three financial consultants recommended by U.S. Bank as it continues to right itself financially.
The state stepped in to help manage the elevator in February and Cody Chambliss, the PUC’s grain warehouse manager, said Wednesday that “in a real short period of time, we’ve made a significant amount of progress.”
Commissioners had praise for Chambliss and other PUC staff, elevator owners Steve and Marcia Schmidt and attorneys for the elevator and U.S. Bank in the effort to keep the elevator operating in Roslyn, a town of about 180 people in northeast South Dakota.
“It’s a key business in that community, a key elevator in that region,” Chambliss said.
Before Wednesday’s vote, Chambliss said there are about 10 producers owed money by the elevator, with three of them willing to take deferred payments over the next three years.
Chambliss said the elevator owes about $1.2 million down to producers, which is significantly from February.
The license renewal comes with the stipulation that the elevator continue to not enter into credit sales. Chambliss will continue to monitor the elevator’s operations and finances.
“This is not an unusual situation, unfortunately, in the grain elevator industry,” Commissioner Gary Hanson said.
He called the agreement “a great road map.”
“This has to be good news for the entire community,” Hanson said.
Should the forbearance agreement not be extended past July 29 or some other option be found, such as a new financial partner or a buyer, the Roslyn Elevator issue may again come before the PUC.
Said Commission Chairman Chris Nelson: "If at some point the bank decides not to renew the forbearance for whatever reason, then we're in a whole new ballgame."