HRK Holdings files for bankruptcy protection citing debts from Piney Point project
PALMETTO — HRK Holdings 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 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.
The Berth 12 dredging project officially opened South Port, the focus of a $200 million decade-long expansion allowing for larger ships and cargos.But while dredging was underway last June, the storage liners sprung leaks, spilling the dredged material into Bishop Harbor, which is downstream from HRK’s Piney Point facility.
The environmental fallout delayed the project for at least a month and increased the overall cost. Because the port held 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 dredging expenses it had to swallow.
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.
The port announced plans to aggressively seek repayment from responsible parties, including HRK.
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 said.
“HRK intends to maintain its close working relationship with the Florida Department of Environmental Protection 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.”
In the bankruptcy filing, HRK lists more than 20 creditors including the DEP, Port Manatee, Florida Department of Revenue and Manatee County Tax Collector.
The company plans to continue service to customers and tenants until the bankruptcy case is resolved.
Josh Salman, Herald business writer, can be reached at 941-745-7095. Follow him on Twitter @JoshSalman
This story was originally published June 29, 2012 at 11:52 AM with the headline "HRK Holdings files for bankruptcy protection citing debts from Piney Point project."