Proposed pork plant won’t resemble Wilson or Farmland

Published 12:00 am Tuesday, April 1, 2003

The pork-processing headquarters for which Albert Lea is being considered would be the most modern in the United States if built &045; so modern that city leaders claim it won’t look or smell like the packinghouses of the past.

And its sheer mass &045; 600,000 square feet, up to 2,000 employees, 4 million hogs slaughtered annually at its peak &045; would pump $100 million into the local economy every year, add to the city’s population and keep school enrollment from declining, a panel of community leaders said at the first of three public forums on the proposed plant Monday night.

Because of its size, the only choice for a location would be to the southeast of the city, close to the sewage treatment facilities, said City Manager Paul Sparks. The old Farmland site in the middle of town wouldn’t work anyway because it’s too small, he said, and a site on Margaretha Avenue is not being considered, as had been rumored, he said.

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Residents filled the lecture hall at Riverland Community College to hear the presentation and ask questions about the proposed operation. In two hours, the discussion ranged from potential odor to housing availability for workers to the anticipated effect on the crime rate if hundreds of new workers move to town.

Over and over, Sparks and the other panelists returned to the same themes: This would not be a packinghouse in the traditional sense, and it would build up to maximum size slowly enough to let the city adjust to the changes it would bring.

But some in the audience were uneasy because the identity of the new company &045; called Premium Pork for now, but that’s just a working title &045; remains shrouded. Investors and executives planning to start the company are already working in the industry and can’t risk having competitors know who they are, said Albert Lea attorney Henry Savelkoul, who has been hired by the investors.

Albert Lea is competing with two other cities for the plant. Sparks identified one of the cities as Elwood, Kan., but said he didn’t know the identity of the other city.

A summary of some key topics discussed Monday:

&045; The economic impact of the plant would be profound, leaders said. The $100 million annual payroll would cycle through the economy several times, and the demand for trucking, boxes, freezer space, housing, retail and other amenities would inevitably spark more development, panelists said.

&uot;It’s everything they needed before in the old plant, basically, times two,&uot; Sparks said of the demand for products that would be created by the plant.

The city probably wouldn’t get tax benefits immediately because tax-increment financing (TIF) would likely divert extra taxes to the construction of roads and utilities for the project, Sparks said, but the bigger impact will be the large company payroll and the extra business it will create.

The company would employ around 400 to start, then build up toward a target of 2,000 employees within seven years or so. Of those jobs, around 300 would be white collar positions, including 75 in management, as well as positions in accounting, finance, human resources, sales, research and development, engineering, legal services and information services.

The rest of the jobs would be in the factory. Those jobs typically pay in the $11-per-hour range, according to Derby Olson, president of the Local 6 Commercial Food Workers union, which represented employees at Farmland.

&045; The plant would not focus on producing consumer-ready products like ham or bacon, but would instead use current technology to keep the meat fresh for shipping, which much of it going to Europe or Japan, Savelkoul said.

He wouldn’t go into details about the process but compared the process to flash freezing to preserve freshness, then packaging it to fit customer specifications.

The plant would also differ from Wilson & Co. or other traditional packinghouses in that it would not buy hogs on the open market; all the animals are already being raised around the county and would be shipped to match the company’s needs. This would eliminate the need for large outdoor holding areas, Savelkoul said.

&uot;There will be no sign of a stockyard visible,&uot; said Albert Lea Mayor Jean Eaton.

The company is image conscious and would take pains to make the plant look more like an office building than a slaughterhouse, he said. The entire operation would be indoors, which would prevent the smells people often associate with packinghouses, Sparks said. The exposed treatment ponds many people remember from Wilson’s heyday would not exist; instead of letting gas and odor escape, the modern plant would recapture the gas and use it for energy, he said.

The plant would even include a visitor’s center to help the company showcase its modern techniques. It could draw a thousand people a year from around the world, the company estimates.

&uot;What they’re talking about is very different from any kind of packinghouse that we’ve seen,&uot; Sparks said. &uot;It’s not like in Worthington.

&045; Many wondered if the city has enough housing to accommodate all the new workers.

Sparks said the city has enough housing stock to handle the initial stages of the plant, and that more can be added as the company grows. More houses should open up for families as senior citizens move into new facilities designed for them, Sparks said. The city’s Lea Center housing project and a possible senior-housing project in the old Albert Lea High School building are two projects that would open up new housing space, he said.

&uot;Housing is an issue, but if we’re going to grow anyway, we’ll have to deal with it,&uot; Sparks said.

&045; Few sites exist that are large enough for the proposed plant, and the need for close access to sewage treatment would restrict the location to an area on the southeastern edge of the city, Sparks said.

&uot;We do not particularly want it inside the city, and hopefully they will be looking at a site outside the city,&uot; Eaton said.

If the site chosen is outside Albert Lea city limits, the city would need to annex the land in order to provide the utilities, roads and TIF.

The company has not chosen potential sites yet, Savelkoul said, but Sparks admitted that the company would probably expect to get the land for free.

&045; The presence of the company’s headquarters, and having top executives living in Albert Lea, is attractive, Eaton said.

&uot;I think having the corporate headquarters is really the appealing part of going after this business,&uot; she said.

The city would structure its contract with the company to require that the headquarters be located here from the start, and that it stay here at least through the term of the TIF district. After the city’s assistance to the company is complete, it would have no more power over the company. If the headquarters moved, however, the city could demand to be repaid for its investment on utilities and other expenses, Sparks said.

&045; Albert Lea Area Schools Superintendent David Prescott said the steady inflow of new students into the district could halt the decline in the district’s enrollment. It is now losing around 75 students a year, and that means state funding continues to fall. The plant would probably stop that decline and help keep the school more financially sound, Prescott said.

Many of the new students may need English-as-a-second-language instruction, he admitted, but he said the district has established an effective ESL program and isn’t worried about helping the new students if the plant is built.

&045; Albert Lea Assistant Police Chief Dwaine Winkels said the city’s police would be prepared to deal with the increased population, and said the department has a long history working with the meatpacking industry. He said there has been no appreciable decline in crime since the Farmland plant closed, and that overall major crime has continued to drop locally, following the national trend.

&045; Freeborn County does not expect an added budgetary strain because of an increased need for social services if the plant is built, said Human Services Director Darryl Meyer. Many social welfare programs are funded by state and federal funds derived from income and sales taxes, not local property taxes, he said. In addition, the extra income from the plant would likely more than offset an increase in the public expense, he said.

He said social-service costs associated with the city’s aging population are actually more of a problem than changes in the demand for welfare programs.

&045; Sparks and Savelkoul stressed that the company’s top priority is speed. &uot;Time is money to them,&uot; Sparks said. They may make a decision in as little as 14 to 30 days, Eaton said, and an agreement with the city could be finalized by sometime in May if Albert Lea is chosen. Sparks said he hopes to have a proposal ready for the city council by its April 14 meeting.