A Penobscot County judge has delayed the sale of the shuttered Hampden trash plant to the group of towns signed up to use it, derailing plans to finalize the transaction by the end of June.
Superior Court Justice William Anderson on Friday ordered that the sale of the Coastal Resources of Maine trash plant, which has been closed for more than two years, not proceed until a hearing on the sale terms takes place. The ruling came after two creditors who put up funds to pay for construction formally objected to the sale terms because they wouldn’t see any proceeds from it.
The Municipal Review Committee — the group that represents the 115 Maine towns and cities that used the facility in the six months it ran before closing in May 2020 — is buying the waste processing plant after a last-ditch effort to find a buyer yielded no qualified bidders.
The sale of the facility was to close by June 30. However, that won’t happen following Anderson’s Friday ruling, in which he set a hearing for Friday, July 1 — one day after the sale deadline — to determine how money from the sale will be divided among the facility’s creditors. The news was first published by the Quietside Journal, a local news blog.
The Municipal Review Committee is buying the waste facility after it reached an agreement with the plant’s financiers earlier this year to launch a new bidding process to seek out buyers. The Municipal Review Committee agreed to put up its own, last-resort bid if no eligible buyers came forward. The group’s $1.5 million stalking horse bid is worth just a fraction of the more than $50 million the financiers, largely out-of-state investment funds, put up to build the facility.
Anderson’s ruling came in response to the creditors CP Manufacturing and SNC-Lavalin, who objected to all proceeds from the sale going to U.S. Bank, the largest creditor. CP Manufacturing and SNC-Lavalin argued that their losses from the Hampden facility’s closure should be prioritized over U.S. Bank’s.
“While the Court understands the reasons why the Receiver is advocating a sale in the form proposed, the Court is unable to approve such a sale at this time,” Anderson said in his order.
The Municipal Review Committee acknowledged the ruling would set back its timeline but said the group thinks the sale could still happen soon.
“We remain optimistic that a sale can occur in the next week or two to focus our efforts on re-opening the facility,” the group said in a statement to members.
The Municipal Review Committee has been working to wrangle control of the facility since it closed in 2020. The group only owns the land off Coldbrook Road on which the Hampden trash plant sits. The financiers that funded the facility’s construction have the power to sell it.
While the municipal group has funds on hand to purchase the facility, it’ll need to look elsewhere for the money to restart and run the facility. It’s estimated that restarting the facility could cost $20 million.
In a town hall meeting in April, Municipal Review Committee leaders said they need help from member municipalities to raise those funds.