Washington County approves $2 million for meat processing plant | WJHL
JONESBOROUGH, Tenn. (WJHL) — Washington County, Tenn., commissioners took the first steps toward creating a meat processing cooperative in the county during a meeting Monday night.
Commissioners approved $2 million from the county’s U.S. bailout funds to fund the Appalachian Producers Cooperative’s continued development of a meat processing plant for local ranchers.
Board chambers were filled with farmers who waited nearly five hours to hear the decision.
Co-op leaders said the plant was needed because more than 90% of the beef produced in Tennessee is not processed in the state. This means farmers are losing potential profits and local consumers are not eating meat raised in their area.
Longtime cattle rancher Dana York told the commission during public comments that the co-op would make beef production a much more viable option in northeast Tennessee.
“I want my grandson to be a lifelong farmer here, but it’s tough without having the ability to market and sell our beef locally,” York said. “If we have to send it to the Midwest to be processed and brought here, that’s not an economic thing for a farmer.”
Farmers said they often had to apply for processing for more than a year before cattle were ready for slaughter. Having the ability to do this in their own backyard would change that.
Washington County resident Freddie Gonzalez spoke out against the funding, saying it was wrong to give so much money to private industry.
“If the business people get together and come up with a business plan to market their product locally where they can benefit much better than they are now, I’m 100% in favor of them doing it” , González said. “I’m 100% opposed to the county giving them $2 million, which I think is $2 million of taxpayers’ money.”
The commissioners approved funding for the co-op, but not without making several changes to ensure the county gets a return on its investment.
The original resolution includes a right of first refusal for Washington County for the next ten years. If cooperation failed, whether through liquidation, default in payment, or inability to secure construction, the county would take control of the operation and assume any debt.
The commissioners amended this section by adding provisions that the co-op must report to the commission every six months and annually for the ten-year period.
They also added an amendment that the co-op can’t spend county money until it’s needed. Wade Farmer, speaking to the commission on behalf of the co-op, said the co-op would need the money no sooner than 2023.
This is done to protect the county’s $2 million investment. Budget committee commissioner and vice-chairman Jim Wheeler said it would give the county the opportunity to continue its investment in county agriculture by finding another suitor for the meat processing plant if things went wrong with cooperation.
“I almost feel like the county is running by the co-op as you try to get this business together, and that’s the reason for the due diligence,” Commissioner Freddie Malone said.
Malone then offered an opportunity for the county to recoup some of its investment by receiving a reduction in distributions from the co-op based on the county’s percentage of the total investment in the project.
The commissioners approved Malone’s amendment.
Co-ops operate by paying distributions to members, the people who produce slaughtered cattle at the factory, and to patrons, the people who buy goods from the co-op.
Members also receive a single vote each in cooperative decision-making.
“The way I offered to structure it, it’s not a loan,” Malone said. “There’s no obligation for you to pay it back. The county can still get zero back, but we can get $2 million if he does as we all hope.
With all the changes, some commissioners expressed concern for Monday night’s vote, offering to move it to the next commission meeting, so the commission could have a chance to speak with County Attorney Alyson Wilkinson.
Most commissioners rejected that because several key grant applications are looming, and the fact that the county’s promised $2 million would help the co-op secure them.
Farmer said the total cost of the project would be $10 million, including $2 million from the county, another $2-3 million in grants, and another $5.5 million in bank loans.
Finally, after nearly an hour and a half of deliberation, commissioners approved the funding by an 11-3 vote. Many called it an investment in the future of Washington County agriculture.
“All of this ARPA money, we can go back to one fundamental thing: generational changes,” Commissioner Ken Huffine said. “We have the opportunity to partner with our farming community to make a generational investment that keeps farming going, that also feeds everyone.”
Farmer said the co-op is considering three locations for the plant, with the preferred option being off Highway 11E near the Jonesborough Flea Market.