050106 Mississippi Beef Processors Fails to Meet Payment Deadline

Jackson, MS - Mississippi Beef Processors LLC president Richard Hall Jr. failed to meet the deadline to make a $325,000 payment on a state-guaranteed $35 million loan.

The Mississippi Development Authority has received no confirmation that Community Bank has received the payment from Hall, who defaulted on the loan Dec. 6.

Hall is head of the company that ran a beef processing plant in Oakland that closed Nov. 17 after three months of operation. Mississippi's investment in the facility has reached at least $54.06 million between the loan and other cash infusions made to the operation.

Hall could not be reached for comment.

State Auditor Phil Bryant has asked lawmakers to draft legislation to ensure state investments into private business ventures are handled in a more businesslike way, preventing such occurrences.

Bryant asked lawmakers to require of future applications to include a detailed business plan, including a resume indicating past work history relevant to the business being proposed.

Bryant said the state should require a credit review of the individuals and/or businesses involved, a market analysis by an independent firm with necessary expertise for the specific projects.

Other recommendations include an independent CPA firm's review of the financial records of the recipients and, if applicable, any others providing funding to evaluate stability and accountability and matching funds or a letter of credit for working capital and construction should be mandatory with any future alliances.

MDA spokesman Scott Hamilton would not say what's next for the north Mississippi plant. MDA Executive Director Leland Speed has said the bank could begin foreclosure proceedings if Hall missed the deadline.

The foreclosure process could take up to six weeks, Speed said.

Community Bank President Darrell Brown would not comment.

The plant's closure put 400 employees out of work without benefits. Hall cited malfunctioning rendering equipment and the need to raise money to purchase cattle.

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