CLEARFIELD – Although the Clearfield school board anticipates more than originally projected from some of its state revenue sources, it may actually result in a loss with Bionol Clearfield LLC filing for Chapter 7 liquidation bankruptcy, according to Business Administrator Sam Maney.
At Monday night’s meeting, Maney reported to the board that the district pending confirmation from the Pennsylvania Department of Education could receive $477,000 more because of increases in the basic education subsidy, accountability block grant and state share social security.
Last month, the district finalized its 2011-12 general fund budget with a 3-mill property tax increase. According to prior GantDaily reports, the budget anticipated $31,380,476 in total revenue and an expense of $33,106,420. A 3-mill property increase generates $363,000 in real estate tax revenue while increasing millage to 92.84 percent for 2011-12.
Further, at the time of the district’s budget approval, the state’s funding for the district was represented by an approximately 10.63 percent decrease, including a 9.31 percent, or $1,193,688, reduction in the basic education subsidy.
However, while mentioning the district’s state funding increase, Maney pointed out that ethanol producer Clearfield Bionol LLC, along with its affiliates Bioenergy Holdings and Bionol Holdings, announced last week their filing for Chapter 7 liquidation bankruptcy in the U.S. Bankruptcy Court in Delaware.
Court documents indicate that Bionol lists assets between $50 and $100 million as well as liabilities of between $100 and $500 million. The company, which produces bio-based chemicals and fuels from renewable feedstock, listed about 100 to 200 creditors, according to Reuters.com.
In a press release, Bionol anticipated that its assets would be sold through bankruptcy proceedings as a functioning ethanol plant. According to the company, the sale process may require four to six months to complete and would be dependent on the judgment of its appointed bankruptcy trustee and subject to court approval.
After the meeting when Maney was asked how the district’s finances would be affected by Bionol’s bankruptcy filing, he indicated the district was expecting to receive $465,000 in tax revenues from the plant. He said the district had not yet been paid by the plant, as the tax bill was set to go out next month.