CHS presents plan to County

FAIRMONT — Martin County commissioners on Tuesday heard from several employees of CHS Inc. who were present to discuss the details of their proposed $100 million project at the Fairmont site and to request a tax abatement from the county. A public hearing on the matter will be held at 10 a.m. on Sept. 3 in the county commissioners meeting room.

The abatement is being proposed to be for up to 10 years beginning with real estate taxes payable in 2022 and continuing through 2031, inclusive and shall not exceed $423,930. If the abatement is approved, construction would start this fall and is expected to be completed by fall 2021.

Brandon Nordstrom, plant manager for Fairmont, shared some details on Fairmont’s plant, which has been here since 2003.

The project is due to the fact that they need to replace old equipment with newer, more efficient and larger equipment. The larger equipment won’t fit into the space they currently have which is why they need to expand.

Also present were city council members, city administrator Mike Humpal, Fairmont Schools superintendent Joe Brown and Fairmont’s economic development coordinator, Linsey Preuss, as well as some community members.

Commissioner Kathy Smith asked how many trucks with raw materials come in every day. Nordstrom said on average, 250 trucks a day, which would increase by 30 percent with the expansion.

Several residents that live near the plant were present and expressed concerns, saying that trucks are already blocking them in and with a 30 percent increase, they fear that the issue will only get worst.

Commissioner Elliot Belgard also expressed concern for the tanker trucks that drive through Truman on their way to Mankato, because they don’t slow down to go the 30 mph speed limit. Belgrade said he’s called up to headquarters several times to express concerns on the issue.

Kevin Peyman, county highway engineer, brought up that the heavy trucks coming and going throughout the day have put a lot of strain on the county roads.

“18 years ago, the county spent $5000,000 building that road. I do think as commissioners, you need to understand there is a fairly substantial cost to the county with this. That road has some pretty severe issues as it is, we’re probably not far out from having to rebuild that road,” Peyman said.

Preuss asked about indirect jobs that would be added, to which Nordstrom said they will use some local contractors for the project. Press also pointed out that outside contractors will be staying at hotels and eating at restaurants in Fairmont.

“I’ve heard negative things about the truck traffic increasing, but really we want traffic on our roads, we don’t want there to not be traffic on our roads or that’s showing a decline in community. I think it’s great that CHS wants to make a 100 million dollar investment in our community and I’m thankful that they’re here and interested in the project,” Preuss said.

Belgard said he appreciated Preuss’s thoughts, but the question is whether a tax abatement is in the best interest for citizens of Martin County. He said in order to grant abatement, the project has to provide at least one full-time job to meet their criteria, which Belgard said it doesn’t right now.

Humpal asked if they don’t do this investment, what happens to the equipment that’s at the end of its life. He questioned what would happen to the plant and to the current 52 employees.

“In 10 years, instead of paying $730,000 a year, they’ll pay 900,000 a year in property taxes. It’s all how you look at it. Saying they’re going to invest another 100 million pretty much says, for me, that they’re going to continue to invest rather than just let this plant go and I think we need to look at that,” Humpal said.

County Assessor Mike Sheplee shared that while the investment is $100 million, the taxable part of that is approximately $5.3 million in new taxable value.

Wes Anderson, a member of the EDA, said of the proposed abatement, “The cost of doing business is what they’re doing. Their stuff is worn out, they need to replace it. If a farmer’s combine wears out, he replaces it and doesn’t get an abatement. He replaces it at his own expense. A company does the same thing, it’s the cost of doing business.”

“Obviously there’s some issues on all sides, but we have been a good steward to the community. We donate to the city, to the pork producers and we’ve always been very supportive of growing the economy,” said Tom Malecha, senior vice president of processing and food ingredients at CHS.

“We’ve been here for 18 years and we intend, with this project, to be here longer. I think you’ll see that the value we bring to the community is much greater than the tax abatement that we’re asking for,” Malecha said.