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Lawmakers Feel Duped By Ethanol Plant Deal

$70M In Taxpayer Money Spent On Unsuccessful Plant, Say Lawmakers

POSTED: 3:59 pm CST November 4, 2009
UPDATED: 11:35 pm CST November 4, 2009

Lawmakers said they feel they were duped into spending $70 million of taxpayer money on a plant that isn't living up to its promises.

Video: Lawmakers Feel Duped By DuPont Promises

In 2007, the state Legislature approved spending $70 million to build a cellulosic ethanol plant in east Tennessee. In partnership with DuPont, the plant was supposed to produce 5 million gallons of ethanol a year made from switchgrass.

Lawmakers Wednesday heard what they approved isn't occurring, and they're mad.

"It looks like we've been sold a bill of goods down here in the General Assembly on this plant," said state Rep. Curry Todd.

Those original plans changed, and lawmakers said they didn't have a clue.

The plant was only built to produce a maximum of 250,000 gallons -- 5 percent of what was intended and not enough to make it profitable.

For the time being, DuPont isn't using switchgrass; it's using corncobs until 2011, even though the state is paying farmers $5 million a year to grow switchgrass.

There's information lawmakers can't get about how money is being spent because it's considered proprietary information by DuPont.

Lawmakers said they feel like they've already wasted money and now might have to pay millions more to keep the plant going.

University of Tennessee leaders defended the project, saying the state building commission approved the scaled back plan and this is a sound investment by the state.

"We are on track," said Dr. Kelly Tiller of Genera. "We are returning on our investment, and we feel like this is a bright spot in an otherwise dim economic outlook."

What's more troubling to them, they said, is why they didn't know until now the money wasn't being spent on the specifics they were told.

There were no guidelines to dictate how the money needed to be spent. They said many people are to blame here, including them.

"We should have locked down and required benchmarks to be met with timelines and strings attached," said Sen. Bill Ketron.

University of Tennessee leaders said the plant is on track.

The reason ethanol production was scaled back to 250,000 gallons was to save money, and they said it will reap huge rewards for research and development and possibly bring huge money to Tennessee in the long run.

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