HRK Holdings files bankruptcy over Piney Point expenses

jsalman@bradenton.comJune 30, 2012 

PALMETTO -- HRK Holdings LLC has filed for Chapter 11 bankruptcy protection as a result of expenses incurred in a gypsum stack liner leak last year in Manatee County.

The June 26 filing requests an emergency hearing before July 5 to cover a request by debtors for HRK to pay pre-petition wages, salaries and other benefits for its employees, court records show.

The case will be heard at the U.S. Bankruptcy Court for the Middle District of Florida in Tampa.

The Manatee County Port Authority has been pursuing financial damages from HRK for its role in the dredging of Berth 12, which had months of delays due to leaks in the pipes and storage sites that housed the dredged material at Piney Point, a former phosphate mine owned by HRK.

"Our attorneys are aware of the filing, and they're evaluating our options and will advise the authority on

the best course," said Steve Tyndal, senior director of trade development and special projects at Port Manatee. He declined to comment further.

The Berth 12 dredging project officially opened South Port, the focus of a $200 million decade-long expansion allowing for larger ships and cargos.

The project was completed in October, but while dredging was still underway last June, the storage liners at Piney Point sprung leaks, spilling the dredged material into Bishop Harbor.

The environmental fallout delayed the project for at least a month and greatly inflated the overall cost.

Because the port signed an independent contract with HRK, it was responsible to pay damages to a Michigan contractor that had filed suit over the $4.8 million in added expenses.

The port earlier this year approved a settlement that will send Great Lakes Dredge & Dock seven interest-free payments totaling $3.28 million over a 30-month period. The first payment was due June 1.

Port officials said they were aggressively seek repayment from responsible parties, including HRK.

In the bankruptcy filing, HRK lists nearly 60 creditors including the DEP, IRS, Port Manatee, Florida Department of Revenue and Manatee County Tax Collector.

A trustee will be assigned to the case to determine which parties receive payments and their amounts. Port officials believe their interest will be high on that list.

"The first question I had is, are we protected in our claim against HRK," Port Authority Chairman Larry Bustle said. "I've been assured our interests will be made as high a priority as anyone else when we go to court."

HRK also has filed suit against the engineers, consultants and contractors that designed and installed the liner system. Prosecution of that suit is not affected by the Chapter 11 filing.

The company also plans to continue service to customers and tenants until the bankruptcy case is resolved.

"HRK intends to maintain its close working relationship with DEP and the Manatee County Port Authority during the Chapter 11 process, the primary purpose of which is to protect the site and its surrounding environment, as well as the substantial investment in the site by HRK and its investors and lenders," HRK CEO Jordan Levy said in a statement.

"The site poses no threat to public health or safety at this time."

Josh Salman, Herald business writer, can be reached at 941-745-7095. Follow him on Twitter @JoshSalman

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