EAST MILLINOCKET, Maine — The town owns the bankrupt Great Northern Paper Co. mill’s secondary wastewater treatment plant, and town leaders are working to replace it eventually with something more modern, officials said Tuesday.
U.S. bankruptcy judge Peter Cary granted a motion from bankruptcy trustee Pasquale “Pat” Perrino allowing the treatment plant’s assets to be sold for $1, free and clear of liens, claims and interest. The motion was granted in Portland federal court on June 18, trustee’s attorney Randy Creswell said.
“It is something we have been expecting, and we are going to move forward with plans to construct a more efficient plant,” Angela Cote, town administrative assistant, said. “We have been essentially running it for the last couple of weeks anyway. We have been working with the trustee consistently since this all began, so nobody will notice any type of disturbance [with water service].”
Attorneys for GNP bankruptcy estates have agreed to loan the town and state as much as $250,000 to pay the treatment plant’s four full-time and two part-time workers and operate the plant for six months, starting last December, according to documents filed with U.S. Bankruptcy Court in Bangor.
Town and state officials have until Aug. 5 to reimburse the two estates for operating the secondary treatment plant, which treats wastewater from town homes and businesses. The operation of the plant over that time will cost less than $250,000, but how much less won’t be known until the estates bill the town. Shawn Doil, the attorney representing the bankruptcy estate, has said the estate had spent about $195,000 through June 4.
The state Department of Economic and Community Development also will share the operational costs, as the state owns the Dolby landfill and landfill leachate is treated by the wastewater facilities at the mill site, officials have said. The state assuming ownership of the landfill was a crucial part of the state’s effort to facilitate Cate Street Capital’s purchase of the mill sites in Millinocket and East Millinocket for $1 in the fall of 2011.
Town officials await the last of the bills and other paperwork before they assess how much the town will have to pay going forward, Cote said.
The Board of Selectmen and town administrators have worked to protect several town interests since the Great Northern Paper mill shut down in late January 2014, eventually laying off all but half a dozen maintenance workers from its 256-member payroll.
The Katahdin region’s largest single employer and taxpayer, the mill began filing for bankruptcy in September 2014. Hackman Capital Partners of Los Angeles successfully bid to buy the paper mill for $5.4 million Dec. 2, 2014.
The town needs to replace the wastewater treatment plant with something more modern, a task that would be made easier with the use of state and federal grants, board Chairman Mark Scally said.
With the sale of the plant to the town, Creswell can begin turning his attention to the mill’s unsecured creditors who have filed claims against the estate. He hopes to have that payment effort finished by January, he said.
“It is hard to say what the dividend will be,” Creswell said.
More than 100 creditors seek about $11 million of the $22.6 million in unsecured debts GNP revealed in its court filings, Creswell said.
BDN writer Darren Fishell contributed to this report.