By Kerry Minor
September 28, 2019
JOHNSTOWN — The longtime dormant, partially-completed Johnstown Renewables construction project at the Johnstown Industrial Park may never be finished, as its key assets are being liquidated.
A California asset advisory firm plans to auction off its onsite components in October.
Heritage Global Partners will conduct a liquidation auction from 7 a.m. Oct. 28 to 10 a.m. Oct. 29 at the unfinished, 224 Enterprise Road plant site.
Construction of Johnstown Renewables was shut down in spring 2017.
Nick Dove, Heritage’s executive vice president of sales, said Friday that all of the parts of the business — never completed to get the plant up and running — will be auctioned off. He said customers for such products can be corporate buyers or individuals.
“Anyone with tertiary businesses,” Dove said. “The assets are tanks, dryers and silos, food processors, things like that.”
Heritage Global Partners’ website is advertising that the auction is taking registrations for those interested in a range of equipment. Items include “never installed process equipment from an unfinished plant intended to convert whey byproducts into ethanol and animal feed,” the website says.
“All equipment never used!” the website boasts.
Specific equipment includes 50,000 and 25,000-gallon stainless steel vertical jacketed silos. Other items to be liquidated include stainless steel tanks, cooling towers, a drum drying resource four-column automated distillation system, nozzled disc centrifuges, a diesel generator, and a stainless steel filter system.
Johnstown Renewables was an ill-fated project that was supposed to be done at the Johnstown Industrial Park. Officials have said the project was mainly halted due to the unexpected passing of the main financier, Christian Eisenbeiss. But new developers later showed interest, but to no avail. The Fulton County Industrial Development Agency was involved with the project, even extending its project completion date for benefits until Dec. 31.
The proposed Johnstown Renewables project has lay dormant for sometime. The plant was originally supposed to be up and running by Oct. 31, 2016. Since then, the project has been marked by unfinished construction and legal action.
Johnstown Renewables was expected to use whey byproducts from the nearby FAGE USA yogurt manufacturer and turn it into useable products such as ethanol and animal feed. The $16 million project was expected to create 27 jobs to start. But construction was halted on a 5.2-acre parcel. Workers had been constructing the plant, but Johnstown Renewables shut down construction in spring 2017 at its partially-completed Enterprise Road building.
FAGE USA filed a $20 million to $50 million breach of contract lawsuit against Johnstown Renewables. The status of that suit was not known Friday.
Albany attorney David Cost — on behalf of Johnstown Renewables — filed a $13 million legal counter-action Dec. 1, 2017 in state Supreme Court in Johnstown. According to Johnstown Renewables’ counterclaims, FAGE entered into a contract on Jan. 1, 2015 with the yogurt firm supplying its materials for 10 years. But FAGE knew Johnstown Renewables didn’t have the “physical capacity” to handle Fage’s waste stream, the counterclaim says.
In January 2016, Johnstown Renewables had filed an application with the IDA for a project in the Johnstown Industrial Park. The company at the time had two primary stockholders — CRE Capital, LLC — 70 percent; and New Age Renewable Energy — 30 percent. Eisenbeiss was the sole member of CRE Capital, LLC and the managing member of Johnstown Renewables.
The project involved building a 11,900-square-foot building in which ethyl alcohol would be produced from liquid whey from the adjacent FAGE yogurt manufacturing plant.
The IDA board executed 10-year lease and Payment In Lieu of Taxes, or PILOT, agreements with Johnstown Renewables in March 2017. The board also approved a sales tax exemption for the project for the period of July 15, 2016 to Dec. 31, 2017.
In June 2018, the IDA contacted the city of Johnstown to check on the status of a PILOT payment due the city. The city had not received payment. Upon discussion with the city, it was determined the city sent the PILOT invoice to the wrong address. The IDA provided the correct address to city, and the invoice was sent to correct address and payment was received.