Firm promises payments to Moberly for plant
Thursday, September 29, 2011
COLUMBIA (AP) — The former CEO of a firm behind a Missouri artificial sweetener plant in Moberly agreed that his new company will pay the city $250,000 by Monday and $3.2 million more within a month for the project now to be turned over to that company.
Bruce Cole has reached an agreement that would allow American Sucralose Manufacturing Inc., to handle the sweetener plant. The deal requires payments to Moberly, completion plans and an estimate for additional costs for the plant to earn at least $4.3 million, which is the average annual bond payment.
Moberly Mayor Bob Riley said the agreement was an attempt to allow the sweetener plant project to work. He declined to comment about any financial information city officials examined that gave them confidence in the new arrangement.
“Like everyone else in Moberly, we are trying to solve the problem,” Riley said. “The end result is we want the plan to be operational and provide jobs for the people that are out of work.”
Mamtek U.S. Inc. planned to employ several hundred people at a sweetener plant in Moberly. The city issued $39 million in industrial development bonds, the state offered more than $17 million in incentives — though the company has not received state funds. The company also was to get $8 million in private investment.
However, the plant still is under construction and Mamtek has laid off its employees. Mamtek this year made a payment for more than $1.2 million in interest for bonds on the project. But the company did not pay its first $2.2 million payment for principal and missed a second interest payment for more than $1 million on Aug. 1.
Principal investors of Mamtek formed American Sucralose.
Moberly is about 30 miles north of Columbia and has a population of about 14,000 people. Democratic Gov. Jay Nixon traveled to the city in July 2010 to announce the project and touted that it could create more than 600 jobs.
The new agreement was signed on Friday by Cole and Riley. The Moberly City Council approved it during a closed session.
Council member Nancy Copenhaver said officials had to rely on what economic development officials were doing to resolve the issue.
“They don’t clue us in on the behind-the-scenes details,” Copenhaver said.
The attorney general’s office said last week it is assisting the Randolph County prosecutor to determine if any state criminal or civil laws were violated. A state Senate committee announced Monday it planned to review role of the state Department of Economic Development in the project.
The Moberly Monitor-Index reported that City Bank and Trust in Moberly contends that Mamtek defaulted on payments for two vehicles. The bank has asked for the company to pay about $30,000 plus interest for a 2009 Chevy Silverado and a 2006 GMC Envoy and for the vehicles to be returned.
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