http://www.heraldandnews.com/articles/2007/03/21/news/local_news/local1.txt
City may seek loan for biofuels project

H&N photo by Andrew Mariman Eric Anderson, left, the CEO of Evergreen Bio-fuels of America Inc. and Brent Budden, a director of Evergreen, stand on the grounds of what could be Klamath's first biodiesel and ethanol plant.

March 21, 2007 Herald and News

The City of Klamath Falls is considering borrowing $2 million from the state to help a company build a biofuels plant that would employ 23 workers and contract with area potato and sugar beet growers.

City council members said Monday they would study details of the deal presented by Evergreen Bio-fuels of America, before lending support to the $6-million plant.

State involvement

The $2 million loan would come from the Oregon Economic Community Development Department, said City Manager Jeff Ball. It would be used to purchase the former FINI Enterprises building on Mallard Lane near Klamath Memorial Park.

The plant would be developed at the site and produce biodiesel and ethanol. Both are alternative energy sources made from organic matter.

Six Klamath Falls residents form Evergreen's board of directors. Eric Anderson, a 1985 Oregon Institute of Technology graduate, is its CEO. Other directors are Charlie Swift, Randy Shaw, Brent Budden, Harold Hartman and Diane Spires.

The city's support would help financially and could be used by Anderson and his business partners to raise additional capital, officials say.

Proposal like others

“The proposal is not unlike what we did with NEW Corporation,” Ball said, referring to the company operating on a site north of Oregon Institute of Technology. It now employs 650 people.

Anderson said the rest of the money needed would come from investors and other government sources.

“Approximately $2.5 million would come from investors, most of whom we hope to recruit from within the area,” he said. “That would give us greater control over the operation of the plant and would mean more jobs.”

The remaining $1.4 million is expected to come from a state-based loan program, a USDA rural development grant and conventional business loans and venture capital.

Council members scheduled a study session on the issue next week.

If everything goes as planned, Anderson said the plant could begin operating this fall, producing one million gallons of biodiesel. Ethanol production could start as early as October, he said, adding that long-term plans include expanding production to 25 million gallons biodiesel and six million gallons of ethanol per year.

-Gerry Baksys