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State treasurer yanks low interest loans from Show Me Ethanol

An ongoing tussle with lawmakers and Missouri Treasurer Sarah Steelman has left local corn growers holding the bag.
Last week Steelman held a press conference announcing that she had pulled conditional low interest loan funds off the table for the Show Me Ethanol plant located in Carrollton. SME is supplied by Ray-Carroll County Grain Growers.
SME originally applied for the low interest loans two years ago and has been waiting for Steelman’s office to deposit the funds. Steelman said she has been waiting for SME to comply for two years. The application is for a low interest loan through the Missouri B.I.G. program for businesses that are taxpayer funded. Steelman said she put a policy in place that elected officials could not participate in the plan.
Included in SME’s investors are Andy Blunt, brother of Gov. Matt Blunt and the wife of Missouri Congressman Sam Graves. Also involved is state Rep. John Quinn, R-Chillicothe.
“I firmly believe that it’s wrong to allow any statewide office holders or any elected officials or any members of their family to participate in programs that were designed to help taxpayers,” Steelman said. “If you allow that, you’re basically allowing taxpayer money to benefit people holding office.”
In May, Missouri lawmakers passed a bill with an amendment in it that said that companies applying for taxpayer funded programs could have up to 2 percent ownership of elected officials or family members. Steelman said the move was not fair to taxpayers.
“It was done in the middle of the night and was slipped into a bill as an amendment,” she said. “They didn’t even take a roll call vote. It’s not a recorded vote. It did not have a public hearing. It didn’t have public discussions and it did not have public recorded voted. I don’t think the taxpayers of this state should be treated this way.”
SME General Manager Greg Thomas said the plant received Steelman’s letter about the same time he found out about the revocation from a call on his cell phone.
“It came as a complete surprise to us,” Thomas said. “We were in ongoing negotiations with them and had been talking to them as early as the first [of September] and were just waiting on some paperwork from our investors. I heard about the revocation driving down the road from a newspaper reporter.
“This is totally unfair to the investors,” he added. “We thought it was a very unprofessional way to do things.”
Steelman said Thomas’ office has refused to comply since the law went into effect.
“All they needed to do was get rid of the members who were not in compliance and they refuse to do that,” Steelman said.
Thomas said his office was working on the compliance and had been waiting on the new legislation that went into effect Aug. 29. Steelman’s letter was issued last Thursday. He said claims that they are refusing to comply simply are not true.
“We’re complying with the request. We were also waiting on the new legislation that was signed by the governor in August. We’re working through this thing. There was no warning. No deadline was put on it and there was no phone call saying that if you don’t get this done we’re going to revoke it. She just sent the letter and had a press conference.”
Ray-Carroll General Manager Mike Nordwald said the claims are nonsense and that he does not understand where her motivations are coming from. Ray-Carroll is one of the 550 investors in SME.
“All of them combined are under the 2 percent threshold and she knows that. It’s only an excuse,” Nordwald said. “It’s certainly concerning that there is a program in the state of Missouri, the B.I.G. program, that’s designed for this very purpose. We made application. We received approval. Approval was withdrawn and the rules of the game were changed several times to make it more difficult. We continued to comply with the rules.
“She simply doesn’t want the program to be utilized evidently,” he said.
He went on to say that all of the officials involved would be leaving office in a matter of months, so there is no conflict.
The B.I.G. award would have been the biggest awarded to any company so far. Thomas and Nordwald both said that at the end of the day, farmers who are the majority owners would be the ones with less in their pockets. Thomas did say that it would not affect the operations of the plant.
“A reduction of $6 million in interest is certainly something we wanted to see,” Thomas said. “It wasn’t in the original business plan so it doesn’t affect the ongoing operations.”
Thomas said the plant would reapply next year when a new administration is in place.
“Either administration that is coming in is favorable to Ethanol and we’re hoping to reapply.”
Photo: Show Me Ethanol is currently the state’s largest producer of ethanol. The distilling chutes shown here produce up to 55 million gallons of ethanol a year. (Photo courtesy of Show Me Ethanol)

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