Judge orders biodiesel firm to repay $215K loan
By BRENDA SOMMER bsommer@leader-news.com

As expected, a district judge has ruled in favor of the El Campo City Development Corporation in that agency's lawsuit to recover a $215,000 loan made to a biodiesel promoter.

"Now we have to wait and see if we can collect," said Gwen Willis, CDC board president.

The lawsuit concluded Wednesday when 23rd District Judge Ben trict judg- Hardin signed City Attorney Ronny Collins' motion for summary judgment.

Collins said Texas Biodiesel Corp. didn't respond to requests for information (called "discovery") that came after the lawsuit was first filed, and a court would take that to mean the company didn't dispute what Collins was claiming.

In the ruling, Hardin ordered Texas Biodiesel; John Autrey, company president; and Lori Lato, a Texas Biodiesel vice president, to repay the entire loan plus $15,000 in Collins' attorney's fees and $585 in court costs. He added interest of 7.75 percent per year until the total is paid, and included attorney's fees' provisions in case Texas Biodiesel appeals the case.

Lato and Autrey co-signed the loan agreement, personally guaranteeing it would be repaid.

"We definitely had personal guarantees for Mr. Autry and Lori Lato, and our next step will be to have Ronny Collins follow through with collection," Willis said. "We also had the guarantee from the corporation."

She said because Autry and Lato backed the loans personally, there's some hope of collecting the money owed.

"If we have personal guarantees, they have to own things that are of salable value, so of course there's hope we can recoup some of this money," Willis said. "The timing of that, of course, is unknown, but the CDC is certainly going to pursue every attempt to collect."

The oft-delayed multi-milliondollar Texas Biodiesel project, which first came before the CDC in August 2003, was granted a $165,000 forgivable CDC loan. The El Campo Economic Development Corp. - a privately funded, local business advocacy group - kicked in an additional $50,000.

The terms of the loan were that if ground had not been broken by the Sept. 1, 2006 deadline, the company would have to repay it, but CDC directors granted a six-month extension. Autrey asked for a second extension in March, but was turned down by the CDC board.

In April, the CDC board voted to sue.

23rd District Court's Judge Hardin was to hear Collins' motion Monday, but was out of town on another case. Collins sent him the order asking for the summary judgment to be granted, since Texas Biodiesel did not file a response to the summary judgment motion, and the time passed for them to do so.

Collins said there's a 30-day waiting period for the decision to become final.

A message left for Autrey at Texas Biodiesel's Houston office requesting comment was not returned as of presstime. NEVER BROKE

GROUND:

The Texas Biodiesel Corp.

received a $215,000 loan from El Campo

developers in August 2003,

but never

broke ground

on the project

claiming other biodiesel efforts sabotaged their

plans.