Faribault Brewery Request to Amend Loan Denied by Rice County Board
The Rice County Board of Commissioners voted unanimously Tuesday not to amend a loan agreement with M.O.E. Craft Company LLC, formerly F-Town brewery of Faribault. Commissioners made the decision while meeting as the Rice County Housing and Redevelopment Authority Board. The vote followed a closed door session Commissioners held with County Attorney John Fossum to discuss possible litigation.
The closed door session was conducted after a presentation to the board by Rice County Housing and Rehabilitation Authority Executive Director Joy Watson. Watson explained F-Town Brewery of Faribault now restructured as M.O.E. Craft Company LLC had not made a payment on their loan from the Housing and Redevelopment Authority since September of last year and were in default. The company wanted to amend the loan agreement so payments would resume in January of 2019.
The agreement was signed in 2015 for the $50,000 loan for equipment for the brewery. $40,000 is still owed on the loan which included a three percent annual interest rate.
M.O.E. Craft Company President Travis Temke repeatedly told commissioners meeting as the Housing and Redevelopment Authority Board a plan to move the operation to St. Paul and amending the loan agreement would be the best way for the company to be able to repay the loan. He said loans from the Southern Minnesota Initiative Foundation, City of Faribault Economic Development Authority and Faribault Industrial Corporation had all been amended.
Commissioners emphasized the loan for the brewery equipment was awarded to provide some economic development for Rice County and once the movement of the equipment was made to St. Paul as far as Rice County was concerned their loan needed to be repaid.
Commissioner Jeff Docken moved, "to deny the amended loan agreement and authorize HRA to take whatever means necessary to collect the debt." Commissioner Jake Gillen seconded the motion.
Board Chair Steve Bauer stated, "I feel too at this point that the agreement that we had and the loan that we made was made specifically for that development or operation of business in Rice County and it looks like that's not going to continue."
Docken added, "Mr. Chairman I agree with that a hundred percent and I think that if you see that equipment leaves this county the chances of recuperating our losses is going to be zero."
Bauer said the move needed to be made, "in the best interest of the taxpayers to take this action."
Following the meeting Rice County Attorney John Fossum was asked if by "any means necessary" included litigation. Fossum responded it would not be the place to "start" but could be used if necessary.