Port grain elevator dispute ends up in court

State, lease holder fight over who should pay to fix facility closed by storm

May 04, 2002|By Ted Shelsby | Ted Shelsby,SUN STAFF

The dispute over who should pay for repairs to reopen the port of Baltimore's only grain elevator - a facility considered critical to Central Maryland farm economy - might be decided by the courts, a top port official said yesterday.

James J. White, executive director of the Maryland Port Administration, said the MPA asked Baltimore Circuit Court on March 28 to deny a request by ADM/Countrymark Inc. that the state pay $6 million for lost business and submit to arbitration the question of who pays for repairs.

The case was shifted from Circuit Court to U.S. District Court in Baltimore on Monday.

When the North Locust Point grain elevator closed in June because of storm damage, it marked the first time in more than a century that ships hauling grain did not call on Baltimore.

White said ADM/Countrymark, a division of Archer Daniels Midland Co., is seeking $2 million a year from the MPA for expenses resulting from the closing of the state owned-facility. ADM has two years left on its lease with the port.

"Our attorneys tell us their claim is unfounded," said White. He said the issue is over a facility that has become obsolete and has out lived its usefulness.

The MPA said ADM does not have a right to demand arbitration, which would probably result in state taxpayers' covering at least part of the cost of repairing the grain elevator.

In papers filed with the Circuit Court, the MPA said that in 1999, ADM had an engineering company perform a structural evaluation of the grain pier that disclosed hazards.

"But they never notified us of this report," White said. "They continued to use the [elevator] and never notified us of the problems. That's a key issue."

The MPA said that because it was not informed of the problems, it is relieved of any obligation to maintain and repair the elevator.

ADM officials did not respond to requests for an interview yesterday.

In February, ADM announced that it would shift its grain exports from Baltimore to a terminal operated by Perdue Farms Inc. in Chesapeake, Va.

Grain shipments once accounted for nearly 20 percent of the port's exports.

White said the grain elevator moved more than a million tons of grain last year, of which 10 percent or 15 percent came from Maryland farms. The pier is also responsible for 110 port jobs.

A spokesman for ADM said in February the company wanted to maintain a presence in Baltimore and hoped that an agreement might be reached with the state to repair the elevator. White expressed a similar hope yesterday.

The closing of the grain elevator cost Central Maryland farmers about $4.4 million last year, said Lynne Hoot, executive director of the Maryland Grain Producers Association.

Farmers had to pay 20 to 25 cents a bushel to truck their soybeans to Norfolk, Va., or other ports.

Charles "Jamie" Jameson, who grew nearly 3,000 acres of soybeans at a farm near Poolesville last year, said he lost about $25,000 as a result of the closing of the Baltimore grain pier.

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