Town sues Carbon Harvest founder over borrowed money
BRATTLEBORO -- The town has filed a lawsuit against Donald McCormick, the founder of the now-bankrupt business Carbon Harvest, seeking a portion of the money he borrowed from the town.
McCormick borrowed $40,000 from the town when he was trying to establish his business, Carbon Harvest, near the site of the Windham Solid Waste Management District.
McCormick was trying to set up a sustainable energy and food system using methane gas from the waste district to power a closed loop system that would produce food in green houses.
McCormick signed the five-year loan with the town of Brattleboro on Sept. 24, 2009.
He launched his project in October 2010, but within two years investors had taken over, saying the business was running out of cash.
Most of the Brattleboro workers were fired in October 2012 when McCormick told the Windham Solid Waste Management District board that the company would be able to bounce back.
McCormick was removed as an officer in January 2013. The company filed for chapter seven bankruptcy protection in April 2013. In court papers filed on July 25 the town asks McCormick to repay the balance of the loan, about $14,000 plus interest, along with court and legal fees.
"Carbon Harvest has defaulted on the loan that had been provided by the town," Brattleboro Selectboard Chairman David Gartenstein said. "The personal guarantor of the loan has been the subject of a civil suit that has been filed by the town."
Carbon Harvest also took out $810,000 in loans from Vermont Economic Development Authority, which now holds the first lien on the company’s equipment.
McCormick met with town officials on May 23 to ask that he be relieved from paying the balance of the loan.
He claimed that the project brought about $2 million in investments to Brattleboro, and at the same time said the project’s failure caused deep financial difficulties for his family.
He believes the project can still be saved and offered the town help in bringing in investors and technical help to get it back on line.
On July 1 McCormick sent a letter to the town saying that he was considering personal bankruptcy.
In his letter he states that he is "unable to pay Carbon Harvest’s debt."
He claims that he is unemployed, has two children to support and has sunk about $15,000 in debt.
"I did my very best to build something that can change the world for the better in a small way," McCormick wrote. "I have learned that sometimes the darkest events open new opportunities, maybe this is one of those moments."
TALK TO US
If you'd like to leave a comment (or a tip or a question) about this story with the editors, please email us. We also welcome letters to the editor for publication; you can do that by filling out our letters form and submitting it to the newsroom.