OLD ORCHARD BEACH – The Old Orchard Beach Town Council on Tuesday will consider revoking the business license of Kate’s Homemade Butter, which has operated as a home-based business in the town since 1981.

Losing the license would put Kate’s, which produces more than 1 million pounds of butter a year, as well as buttermilk, out of business, according to Lucas Patry, son of Kate’s owners, Dan and Karen Patry.

“I honestly don’t know what’s going to happen on Tuesday,” Lucas Patry said. “If we lose our business permit, we’re out of business. We wouldn’t have a license to operate and we won’t get product on the shelves, we’d get kicked out of the grocery stores and we won’t get back in.”

After Kate’s representatives missed a meeting May 14 with the administrative board of review and neighbors, the board recommended that the Town Council consider revoking Kate’s license. The council will weigh the issue at its meeting Tuesday.

It’s unclear whether a formal vote will take place that night or at a later hearing, said Kate’s attorney, Timothy Bryant of Preti Flaherty Beliveau & Pachios.

Kate’s operates in about 1,000 square feet of space in a garage of an Old Orchard Beach home. The company has been building a 17,600-square-foot facility in Arundel, but that relocation has been slowed by past construction problems with the roof.

Neighbors have complained that Kate’s, which has trucks delivering raw materials and taking away finished products, should not be operating in a residential neighborhood.

Dan Patry starts at midnight and works an 18-hour shift to complete butter production. Neighbors previously raised concerns about the early-morning noise, as well as the stacking of pallets in the driveway before the truck arrives. To address residents’ concerns, Kate’s agreed in September to modify the hours of its operations, reduce the size of its delivery trucks and plant trees and install other barriers to reduce noise.

“They acted a little better for a while, but there’s still a truck that shows up between 4 and 6 in the morning,” said Harry Bailey, a neighbor of Kate’s. He said he’s not against Kate’s but feels it’s outgrown its space.

“What started out as a family business is now producing a million pounds of butter. It really doesn’t belong in a residential neighborhood,” Bailey said. “But none of us want the business shut down immediately.”

Lucas Patry said tension with the neighborhood escalated over the winter, even after the company modified its operations.

“Things went downhill this winter. Things had gotten bad — beer bottles left on our property and obscenities yelled at us,” he said. “We did what everyone asked — we have a smaller lift on the truck to reduce noise, we changed operating hours.”

Kate’s previously said it would have to move out of Old Orchard Beach into the new facility by June 2013 because its lease on a storage space in Biddeford expires in July. Bryant said Kate’s hopes to move to Arundel by September, but it’s unclear if that will be possible.

Lucas Patry said construction crews are working on the Arundel site six days a week, but it’s not yet done.

He said Kate’s had informed the code enforcement officer in February that representatives of the company would not attend the May 14 meeting since tension with the neighbors had escalated and the family did not want to be subjected to verbal attacks. Patry said the code enforcement officer did not object to their missing the meeting.

If a licensee fails to appear before the administrative board, that can be grounds for revoking a license, according to background material provided for the Town Council meeting.

Town officials could not be reached for comment Friday. 

Jessica Hall can be contacted at 791-6316 or at:

jhall@pressherald.com