AgStar has also worked over the past year to build a network of potential partners, including the Southern Minnesota Initiative Foundation, which provides gap financing for economic and work force development projects.
“I don’t have a lot of loan money,” says Tim Penny, former U.S. Representative and current president and CEO of the foundation. “But we have now convened with AgStar to tell them what type of projects we would be interested in partnering with them on.”
Penny believes the rural development arm of AgStar not only
has the right vision, but also the right attitude. “AgStar made its facility
available to us recently, so I could hold my board meeting at the Mankato
location,” he says. “It was very convenient. They even had the coffee ready for
us.”
Making AgStar |
AgStar is the product of four mergers of Farm Credit Services institutions over an 11-year period: ›› 1991 Farm Credit Services of Southwest Minnesota merges with Farm Credit Services of Southern Minnesota. ›› 1993 Farm Credit Services of Southeastern Minnesota merges with Farm Credit Services of Southern Minnesota. ›› 1998 Farm Credit Services of St. Cloud merges with Farm Credit Services of Southern Minnesota, and changes its name to AgStar. ›› 2002 AgStar and Farm Credit Services of Northwest Wisconsin merge, retaining the AgStar name. |
Building a Rural Future |
Currently, AgStar has around 30 infrastructure projects in the pipeline. It also has made investments in a number of completed projects, including assisted-living facilities in Waseca, Fairmont, and Lake Crystal; and mental-health and chemical-dependency treatment facilities in St. Peter, Annandale, Cold Spring, and Mankato. A couple of recent examples: • The new $18-million critical-access hospital in St. James (about a half-hour southwest of Mankato), which opened in mid-November, replaced a hospital built under the 1946 Hill-Burton Act, which was designed to provide federal grants and guaranteed loans to improve the nation’s hospital system. Because most of Minnesota’s critical-access hospitals were built 50 to 60 years ago as a result of the legislation, most are now in need of either replacement or renovation. “Probably only 20 or so of Minnesota’s 79 critical-access hospitals have taken on remodeling or rebuilding, so about 50 or 60 still need funding to upgrade their facilities,” says Bill Slininger, community program director for the U.S. Department of Agriculture’s Rural Development Minnesota division. • When Memphis-based Monogram Food Solutions looked into converting a former Sara Lee plant in Chandler into a Monogram Meat Snacks plant, Murray County (where the southwestern Minnesota town is located) was more than welcoming. But the conversion project was too big for government grants alone to cover. The Murray County Economic Development Association recommended that the company call AgStar. The converted plant opened in May, adding 25 full-time jobs to the city, and is now the main non-ag employer in the area. Steve Wenzel, state director for USDA Rural Development Minnesota, believes that AgStar’s role in rural development in the state will expand significantly. That’s not only because Farm Credit Association members have now entered the picture, Wenzel says, but also because the 2002 farm bill increased funding dramatically from $9.2 billion a year to $17.5 billion a year (Minnesota’s annual share of that is about $500 million). This offers AgStar opportunities for putting together larger funding packages. |
