photo cred WITN

Hoke County, North Carolina Ethanol Plant Background;
The Hoke County Commissioners sponsored a development agreement to build an Ethanol Plant. The county gave CleanBurn LLC 500 acres on the county’s 1,366-acre industrial site, about three miles south of Raeford in Dundarrach.
The land was part of a 635-acre parcel purchased by the county in 2006 for about $3.8 million and initially gave Clean Burn 500 acres there. About $1.5 million was spent by Hoke County to extend utilities to the site.
CleanBurn Fuels originally filed for permission to build the plant in 2005. By 2007 it had been awarded a $35 million loan from the US Department of Agriculture (USDA), in addition to a $65 million bank loan from Cape Fear Credit Union and alleged funding of $10 million from private investors.
The plant was expected to begin producing 60 million gallons per year of ethanol by mid-2008 but on going problems meant the plant’s opening was delayed until Q2 2010. However in March 2011, fewer than 12 months since production began, rising corn prices forced the facility into temporary closure. Clean Burn Fuels LLC filed for bankruptcy on April 4, 2011 and then Cape Fear Farm Credit foreclosed on the loans. The property was auctioned on 24 August 2011. Cape Fear was the highest – and only – bidder, with a bid of $34.5 million.
Cape Fear put it on the market and there were no takers. Three years later, in May 2014, Tyton N.C. Biofuels LLC, which is part of Danville, Virginia-based Tyton BioEnergy Systems, bought the plant for approximately $12.8 million.
Tyton NC Biofuels LLC in conjunction with Tyton BioEnergy Systems, intends to operate the plant with a special strain of “energy tobacco” as the feedstock. Tyton claims that this unique energy tobacco is a highly efficient source of plant sugars and oils for the production of biofuels.
Tyton claims that, ” . . . this proprietary energy tobacco can produce up to three times the amount of ethanol per acre as corn and three times the oil per acre as soy.”
Tyton claims to have a patent-pending extraction process.

Hoke County, North Carolina Ethanol Plant August 2016 Update
On the morning of August 26, 2016 there were a maximum of 8 parked cars in front of the office. There was no smell of fermentation. There was a small amount of steam, actually condensed water vapor from a few sources but it did not appear that the plant was running in anything approaching full operation. There was no the sound of electric motors or any crushing or grinding equipment.
One of our sources told us that the plant has just started this week and they will use corn as the initial feed.
The current owner is TYTON NC Biofuels LLC, incorporated in Delaware and with its principal office in Stateline, Nevada. Barbara Carlisle is listed as the first manager. Checking deeds and the recording tax of 0.2%, Tyton BioEnergy Systems (a separate corporate entity) has bought the facility for $12.8 million. There is no Tyton BioEnergy Systems registered with the NC Secretary of State. There is a Tyton Biosciences LLC (created in Delaware with its primary office in Danville, VA) registered with the NC Secretary of State. Yes it is confusing to those not familiar with corporate filings.
Tyton Biosciences on their website claims that they in conjunction with the Department of Energy have created a new strain of tobacco that will be the new feed to the ethanol plant. Tyton has claimed that tobacco will not need fermentation etc. Nonsense. No tobacco that we know of produces ethanol. Maybe some small amount of sugar but absolutely no ethanol. Ethanol can only be produced by fermentation which involves the destruction of sugar, sucrose or dextrose. We don’t believe Tyton’s claims and we need to see this new energy tobacco produce ethanol first.
Michael Futch, a reporter for the Fayetteville Observer, has reported that the project was made possible in part by a performance-based grant from the One North Carolina Fund of up to $232,000. The One NC Fund provides financial assistance, through local governments, to attract business projects that will stimulate economic activity and create new jobs in the state.
Checking the One Carolina Fund page we learn that Hoke County as a tier one county would be expected to match 1 for 3 of state money. So 1/3rd of $232,000 is $73,000 The Hoke County manager, Ms. Edens, has told us that no $73k payment will be made because Tyton has not performed on its commitments.

We spoke with a former employee of the Aberdeen & Rockfish Railroad. He described the railroad connection necessary for this plant. He told us that there was NO way that the railroad was going to pay for that track and connection. Hoke County has paid for roadway modifications, a sewerage plant, as well as the initial outlay for the land and we, suspect the operator may have a tax abatement in future years.
The following statement comes from the TytonBiofuels website.
“This proprietary energy tobacco can produce up to three times the amount of ethanol per acre as corn and three times the oil per acre as soy. When combined with a patent-pending extraction process, energy tobacco can unlock tremendous value for biofuel producers.”

To our knowledge, this alleged new tobacco plant product is still in the laboratory stage and has not been field tested nor obviously produced seed to make thousands of plants for full-scale production.
We believe that Tyton’s statement is nothing but a bald face lie and has not shown to be true either in research or in commercial facilities. Have thousands of tobacco plants been grown in a nursery for field planting? It will be hard to run an industrial plant on tobacco if none is available.
The plant closed in 2011 when the price of corn rose to about $7.50 per bushel. The other unfortunate fact of the matter is that present (2016) crude prices are about $45/petroleum barrel compared to the $80 range in 2011. All ethanol production has to compete in this real world economics environment especially considering that Brasil is still producing ethanol from sugar cane and the product is being imported through the Virgin Islands. Due to the Caribbean Initiative, there is no duty. We can’t see this plant surviving under any reasonable circumstance. It is absolutely imperative that the county does not “invest” any more money in this project.
Bottom Line – The Hoke Ethanol plant is a LOSER based upon a non-proven agricultural optimization and governmental funding and mandate. The taxpayers of Hoke County need to be informed of this fraud in that the county property owners are paying for it via their tax bills.
The plant first built by CleanBurn Fuels Inc. was estimated to cost in excess of $100 million of borrowed money largely from the Cape Fear Credit Union and the United States Department of Agriculture. Tyton purchased the plant for $12.8 million based upon their perception of the value of the land and the scrap value of the current plant.

Ethanol plant August 31, 2016 Update
Conceived in illusion, developed in fraud, ratified in ignorance, fertilized by debt, useless as a plant without leaves. That is Hoke County’s ethanol plant. Hoke County taxpayers paid $3.8 million for an irrevocable gift of land to the plant and $1.5 million for utility improvements. $5.3 million in 2008 dollars was stolen from the Hoke County taxpayers. No encumbrances were placed on the deed, meaning that the plant could be sold and Tyton NC BioFuels would keep the proceeds. $5.3 million at 3% for 8 years is $6.7 million, today’s present cost to the taxpayers or about $143 per person for Hoke’s 46,952 population based upon the 2010 census.
The plant is trying to create a future with GMO tobacco that does not exist nor which has ever been field tested. Tyton Fuels presently owes $813,000 (Dec. 2016) in taxes and has to pay interest on a $15.5 million note, say $450,000 a year. The soonest that any tobacco could be harvested will be July 2017. How will these bills be paid from a plant that creates no wealth and produces no product? The ink on the plant’s obituary is still wet. The epitaph for the taxpayers has been dry since 2008.

Our summation follows:
The taxpayers of Hoke county are never going to recover the approximately $5 million that the County Commissioners paid for the ethanol plant and associated utilities.
Original Purchase — The 500 acre parcel was originally purchased from a Z.V. Pate. Pate apparently is very wealthy and has numerous parcels of land. It can be assumed that he is/was very well connected to the political powers in the county.
Agriculture — Neither of our two agricultural sources know of any farmer who has contracted to grow “energy tobacco” in the county. At this time (2016) the “seed” would have had to have been harvested for planting in greenhouses next January/February. Information from the Internet gives no location of any plots of land where this tobacco was grown to furnish the seed. Its hard to be run a plant on tobacco if none is available. Assuming that the tobacco seed exists and that it will be planted. It won’t be till July 2017 before any crop could be harvested. What will the plant do until that time? How will they pay property taxes and bank interest?
Taxes – Publicly available records at the present time (29 August 2016) show that Tyton NC Biofuels, LLC owes $406,729 for real estate and the same amount for personal property or $813,458 total. A person in the county office told me that the original gift of the land by the county would be offset by property taxes, yes if they pay them.
The current assessed value of the property is $19,164,510. At a previous time and we don’t know when the assessed value was $21,373,300. Apparently, some form of an appeal was made and the Commissioners reduced the value.
Same family – The Fayetteville Observer reported, “Jack and Greg Carlisle developed and managed Clean Burn, which was expected to bring about 100 jobs to the area. But, because of rising corn prices, the business struggled through its nine months of operation.” Greg Carlisle, the son, was killed in an airplane accident in January 2013.
Under the North Carolina Secretary of State corporations listing, we find that
Barbara B Carlisle, 281 Andria Drive, Stateline, NV 89449 is the manager of Tyton NC Biofuels LLC. This tends to confirm that the relationship between CleanBurn Fuels LLC (now dissolved) and Tyton NC Biofuels was not at arm’s length but was a family relationship of some kind. An individual who was involved in the bankruptcy of Clean Burn Fuels confirmed my suspicions in this matter.
Frankly considering the number of people who were burned by the bankruptcy of CleanBurn Fuels, we doubt if any Raeford businesses will be eager to provide services or material to the new Tyton NC Biofuels.
Cape Fear Credit Union (CFCU) – Cape Fear loaned $65 million initially to CleanBurn Fuels. CFCU paid $35 million to buy the plant from bankruptcy at auction. CFCU received $13 million in the sale to Tyton. Well 65 + 35 – 13 = 87 How the hell can Cape Fear sustain an $87 million hit? This is just another Kafkaesque part of this plant. Many things simply do not make sense.
Register of Deeds – We reviewed several deeds. This is somewhat complex because there are several deeds for each piece of property and separate Deeds of Trust. We believe that we have the major ones however. The Hoke County Deed books are online and can be accessed by anyone.
Here is the kingpin. A deed signed 28 March 2008 by James Leach, Chairman of the Hoke County Board of Commissioners, and attested by Linda Revels, Deed Book 801, pages 285-286, Hoke County gifted to CleanBurn Fuels, L.L.C. 500 acres for the sum of “$10 and other valuable considerations . . .” THERE WERE NO COVENANTS ON THE DEED THAT IF THE PLANT FAILED ETC. THAT THE LAND WOULD REVERT TO THE COUNTY. Translation, Tyton can sell the property and plant and keep all of the money with no contractual requirement to give any of the proceeds to the county. Note that as of November 2016 CleanBurn Fuels L.L.C. has been administratively dissolved by the North Carolina Secretary of State.
On 30 November 2011, deed book 966 page 0133, we find that Cape Fear Farm Credit bought the property for $34,500,000 with stamps costing $69,000 or 0.2%
On 27 May 2014 we find that CFF Holdings granted to Tyton NC Biofuels, deed book 1079 page 606, paid an excise tax of $25,636. No sales price is listed but using the same 0.2% ratio gives us a transfer price of $12,818,000
On 6 Dec 2014, deed book 1099 page 91, we find that Tyton NC Biofuels executed a 22 page Deed of Trust to Fifth Third Bank for $15,500,000.
Would you loan $15.5 million to a company that had bought property for $12.818 million or about 23% over value? Some mortgage, some deal. No I can’t explain it either.
On Tuesday evening, 6 September 2016, at a meeting of the Hoke County Commissioners, during the public comment portion, commissioners were told about the inevitability of closure of the facility, the absurd lies about energy tobacco by Tyton NC BioFuels L.L.C. and the outstanding $813,000 property tax bill.
Bottom line is that we believe that the entire ethanol thing is a fraud, chemical as well as financial. We cannot see how this plant can ever be profitable. Ultimately it will be put up for sale and the Hoke County taxpayers may have to take a complete loss on their “investment”. COMPLETE LOSS
It is our opinion the transfer of land from Hoke County to CleanBurn Fuels L.L.C. was illegal.
Immediately below is the civil action to Quiet Title to the 500 acre site, filed on November 8, 2016 in Hoke County Superior Court. The case was dismissed by Judge Ammonds in December 2016. An appeal was taken to the North Carolina Court of Appeals. All of the documents for the appeal are listed on the website. The case number is 17-341 and all of the documents are available for public view. GO FIND IT cause it TAX DOLLARS -PUBLIC MONEY that was used in this deal and ALL COUNTY LEADERS propped themselves up, praise themselves and were all excited about it and now, they won’t even talk about it. We believe the Economic Developer for Hoke County has done nothing to earn such a high salary for this county and every major project that has come around was conceived outside the county. LEADERSHIP is in questions here and it’s time for Hoke County Citizens to start thinking differently 2018 ! VOTE REPUBLICAN