The Joplin Globe, Joplin, MO

Carthage, Jasper County

Discussion

March 3, 2009

Center notified of layoffs at RES

From staff reports

news@joplinglobe.com

CARTHAGE, Mo. — Three weeks after withdrawing its bid to go public in an effort to raise capital, Renewable Environmental Solutions in Carthage appears to be laying off much of its work force.

Officials with the Missouri Career Center said Tuesday that they had been told of layoffs involving 49 workers at the plant that converts animal products into oil products and fertilizer.

Officials with Butterball Turkey Co. on Tuesday confirmed that the Carthage processing plant on Monday had stopped delivering turkey parts to the RES plant.

City leaders have been told that the plant employed about 50 workers, said Mayor Jim Woestman. He said he has heard reports that the plant may be closing, but he has been unable to confirm them. He said City Administrator Tom Short could obtain no answer from the local plant, and calls to corporate headquarters in New York were not returned.

Jasen Jones, executive director of the Workforce Investment Board of Southwest Missouri, said the Missouri Career Center is setting up a Rapid Response Team for employees “affected by potential layoffs.” Jones said the plans are based on reports from workers and the fact that the state also had not heard from the company.

“We don’t know whether it’s a full, partial layoff, or whether it’s temporary or permanent,” he said.

On Feb. 12, Changing World Technologies, the RES parent company, filed documents with the Securities and Exchange Commission withdrawing its bid to go public. Changing World Technologies in August launched a bid to go public in a bid to raise $100 million.

The company has been dealing with lawsuits over construction and odor emissions from its Carthage plant. In addition, previous SEC filings indicate the company was losing tens of millions of dollars per year, has not been able to operate the Carthage plant at full capacity, and has experienced times when the plant temporarily shut down.

The company reported a net loss of $21.8 million in 2006, followed by a net loss of $19.9 million for 2007 and a net loss of $18.8 million through Sept. 30, 2008. The company had an accumulated deficit of $117.8 million as of Sept. 30, the filings state.

Brian Appel, chairman and chief executive officer of Changing World Technologies, did not return calls on Tuesday. Missouri Department of Natural Resources officials who have monitored the plant said they had not been informed of any change in RES operations. A DNR spokeswoman in Jefferson City said workers from the Springfield office were to inspect the plant Tuesday, but she had not received a report on the visit.

Legal issues

RES has struggled with complaints about odor emissions from its plant since it opened in May 2004. The company is the subject of a lawsuit filed by two Carthage residents who contend that the company has been negligent, that odors from the plant are a nuisance, and that damages should be awarded to them and other Carthage residents who also have been affected.

Attorneys for both sides on Feb. 18 argued a motion filed by RES, whose attorneys contend that the case should be moved to another county.

The plant was cited by the state for odor emissions six times in 2005 and was temporarily shut down by then-Gov. Matt Blunt in December 2005. Federal officials had lobbied for funds that helped bring the plant to Carthage, and U.S. Rep. Roy Blunt, the former governor’s father, also met with Carthage residents on odor issues.

A public-nuisance lawsuit was filed against the plant in 2005 by the state and the city of Carthage. The action later was settled, after RES installed a thermal oxidizer and other additional odor-control equipment. Those installations have been cited recently by attorneys and company officials in arguments that the company is not responsible for recent odors from the city’s industrial bottoms.

The company has not been cited since 2006 for a violation of state odor standards, which are triggered when odors are detected at a dilution of 7-to-1. Carthage officials lobbied the state, unsuccessfully, for a more stringent dilution standard.





New odor rules



The Carthage City Council earlier this year adopted revised odor rules, imposing a 5-to-1 dilution standard. Officials said enforcement of the measure would not start until workers completed training on odor-measuring equipment.

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