Building incentives please Farmland

Published 12:00 am Thursday, May 23, 2002

Now Farmland has all it wanted from the state legislature, and even though the company is thankful, it doesn’t change their position that ground-breaking for the new plant depends on an insurance settlement.

“We are pleased that the Minnesota Legislature has approved the economic incentives. This resolves one part of the issue,” Farmland Foods President George Richter said in a statement. “Today it becomes even more critical that the insurance companies resolve our claim immediately.”

Farmland announced last month that it would build a new meat-processing facility in Albert Lea, pending the approval of economic incentives and the resolution of the insurance issue.

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Richter said he hopes a meeting with the insurers this week will lead the negotiations to a resolution.

The legislature overrode Gov. Jesse Ventura’s veto on a budget bill which has provisions exempting a sales tax for constructing the new plant, providing $750,000 to the Albert Lea School District over four years for enrollment losses due to the plant’s shutdown, and designating both the old and new plant sites as a single Tax Increment Financing District.

Ventura signed, contrary to predictions, a job bill that includes a 13-week extension of unemployment benefits. But in a press release, Ventura expressed his reservations, warning the bill is unfair and jeopardizes the solvency of the Unemployment Insurance Trust Fund.

“The ball is in Farmland’s court now,” said Sen. Grace Schwab, R-District 27, who sponsored the bills. “They have got a wonderful encouraging package from the state and the city.”

“We are in a pretty good shape, I think Farmland can start building the new plant right away if they settle with the insurance companies,” Mayor Bob Haukoos said.

In March, the city obtained a court order to force Farmland to demolish the old plant. But, Haukoos said the city would not press the company at this moment. “We don’t want do anything that would jeopardize insurance negotiations,” he said.

The 380,000 square-foot new plant at the Habben Business Park near Interstate 35 would cost over $80 million, according to Farmland. It will create 720 new jobs and produce 200 million pounds of ham and packaged pork products a year. The company announced that it would expect to begin operations fall of next year.