The Itasca County Board of Commissioners has called a special session for Monday to discuss updates on the possible sale of Magnetation's assets now pending in federal bankruptcy court.
Magnetation officials earlier this week filed a plan in federal bankruptcy court in St. Paul to sell all remaining assets to Roanoke, Va. businessman Tom Clarke using the company name ERP Iron Ore.
The board is set to meet at 3:30 p.m.
Clarke on Thursday told the News Tribune that the purchase agreement has won approval from nearly all players in the bankruptcy, including major creditors, contractors and vendors.
But Clarke said one major issue remains - the ongoing legal action in state court by some contractors who have filed a mechanic's lien against Magnetation's Plant 4 near Grand Rapids. Because that plant is on land leased from Itasca County, the contactors are alleging in court that Itasca County is liable for the project's debt.
Itasca County has subsequently withheld offering the leases to any bankruptcy heir to Magnetation, and Clarke said this week that without the county leases the sale won't go through.
Clarke said he hopes the unveiling of a viable deal to emerge from federal bankruptcy court will spur both sides to settle the state case.
"Without that lease, we can't operate, and we can't put people back to work, and we can't repay the" contractors and vendors, Clarke said. "We really need that to be worked out before we can close."
Grand Rapids-based Magnetation filed for bankruptcy in 2015 and closed the last of its plants in October.