Committee advocates for COVID funds to reopen former Valero factory

TWP RIGA. – Valero’s former ethanol plant, which sits on 78 acres of land in Riga Township just outside Blissfield, has been out of service since 2019, but it’s worth using the funds from the American Rescue Plan Act to help a potential buyer reopen the plant for ethanol operations.

Ken Lake, a member of the Lenawee County Land Use and Agricultural Economic Development Committee, presented the proposal to the county commission at its last meeting. The committee has nine appointed members. The group is made up mainly of farmers, but it also has a banker and a few commissioners. Each serves a three-year term.

Lake is retired but works part-time in Michigan agricultural commodities like corn, wheat and soybeans.

The plant has been idle until it goes on sale in November 2021. It is unclear where Valero is in the process of finding a buyer and Valero could not be reached for comment.

“Our recommendation to the county is that they consider allocating some of the money from ARPA to help with the reopening of the plant. We don’t know what form that might take. We don’t know what rules are in place that would qualify the money to be used in this way, but I’m sure there are infrastructure improvements or some type of incentive the county could offer to help a new buyer to reopen this factory and that was our goal. We didn’t have anything specific other than that,” Lake said in an interview.

Lake said the equalized state value of the plant is currently $7.8 million and at its peak it was $11.8 million. At the current mileage rate, it would generate approximately $108,000 in taxes if returned to full operation. But the savings are really going to the farmers, Lake said. This would also benefit the Village of Blissfield in terms of collecting water bills.

Riga Township generates about 22 million bushels of corn per year and Lenawee County as a whole produces about 50 million bushels. If only 10 million bushels were used for the ethanol plant, it would save 7 to 10 cents per bushel of freight compared to the cost of transporting corn to the nearest ethanol plants. That equates to $700,000 to $1 million in savings for farmers, according to Lake.

Lenawee and surrounding counties have enough corn to keep the ethanol plant running, Lake said.

The village of Blissfield also received $600,000 more on its water bills when the plant was fully operational, Lake said.

“With just these two identifications of freight savings and water issues, we have an impact in the county of $1.5-2 million in the first year and that’s not even counting all the jobs that would be created” , Lake said.