A number of Iowa farmers are receiving letters from a former ethanol company that filed for bankruptcy two years ago. Those letters ask for a repayment of funds to VeraSun. The Iowa Corn Growers Association is warning farmers the letter is legit. Mindy Williamson is spokesperson for the organization.
“We’re advising farmers to take the letter seriously and seek some legal counsel to help resolve this,” Williamson said. She says the so-called “brother-in-law rule” affects farmers who sold grain to VeraSun 90 days before they filed for bankruptcy in 2008. It’s not clear how many Iowa farmers might be affected by the rule.
“We’ve received quite a few calls from farmers…basically worried because the letter is very official and they did not have a lot of warning,” Williamson said. VeraSun operated five ethanol plants in Iowa. They were located in Albert City, Charles City, Dyersville, Fort Dodge and Hartley. Most of those operations were purchased by Valero Energy.
Williamson says her organization is still reviewing the matter and asks farmers to stay tuned. “We’re working on it and we’ll let (farmers) know just as soon as we have information, but we know it’s kind of an uncertain time for them and a shock to get the letter over the weekend,” Williamson said.
In response to questions raised by growers, the National Corn Growers Association has posted a one-page response to the VeraSun letter on its website. See the letter here: www.ncga.com/files/pdf/VERASUN-BRIEFING-083010.pdf