Chicken-plant deal far from hatching, say parties involved

ORIGINALLY WRITTEN DON RATZLAFF
City leaders have a word to the wise: Don’t count on any chickens being processed in Hillsboro before a deal is hatched.


Persistent and sometimes exaggerated rumors have prompted local leaders to acknowledge that preliminary contacts have been made with MBA Poultry, LLC, about establishing a processing plant in the empty buildings owned by Dairy Farmers of America.


All parties agree: It is far too early to know if the deal will happen.


“We don’t have any commitments yet,” Mayor Delores Dalke said Friday. “That’s why it’s been a non-story all this time, even though there’s lots of rumors going around.”


MBA Poultry, based in Tecumseh, Neb., sells Smart Chicken, the registered trademark for their chicken products, which are processed with chilled air rather than water.


At least three grocery stores in the county sell Smart Chicken.


“We are working closely with the mayor and the city of Hillsboro to potentially move forward a due diligence on the potentiality of putting a facility in Hillsboro, Kan.,” said Mark Haskins, president and chief executive officer of MBA Poultry. “Other than that, there’s really nothing more to say.”


Haskins confirmed that Hillsboro is only one of several sites being considered.


“The company has made no commitments to Hillsboro that they are planning to expand here,” Dalke reiterated. “They are in an expansion mode and they have looked at the facility here twice. But there are other facilities available to them within a two-state region that have been poultry-processing plants.”


Company representatives met in Hillsboro Jan. 29 with about 50 people to give an overview of the company and its potential operation in Hillsboro.


Among that group were local civic and industrial leaders, plus representatives from the Kansas Department of Commerce.


Mike Kleiber, president of the Hillsboro Development Corp., attended that meeting.


“They’ve indicated that a maximum facility would employ somewhere in the neighborhood of 250 people,” Kleiber said.


“That would not be a start-up number,” he added. “That would be at full anticipated production, which could be five years or 10 years down the road.”


Kleiber said if MBA Poultry would open a processing plant in Hillsboro, the company would also be looking for new chicken producers in the area, multiplying the economic impact for new growers and local companies that would support them with feed and other products.


“As far as the agricultural community, it’s a value-added product that would be coming out of the community,” he said. “It would be taking our raw-product grain and putting it into a finished product.”


Kleiber said HDC has treated the MBA Poultry situation like any other lead that arises for potential industry in Hillsboro.


“As far as HDC is concerned, we have visited with them,” he said. “The facility they’re looking at, we have no ownership in.


“We have really nothing to offer them other than to assist them in whatever way we can-as we would any other industry thinking of coming to town: making sure they see the right people as far as contacts, and what incentive programs are available locally and through the state.”


Kleiber said conversations between the city and MBA Poultry began about one year ago. Representatives from Hillsboro have visited the MBA Poultry plant in Tecumseh.


The due-diligence process on the DFA building will take 90 to 120 days, Dalke was told by MBA representatives.


Kleiber said it was too early in the process to assess the implications to the city if the company would decide to expand in Hillsboro.


“We really haven’t seen what their business plan is,” he said. “They haven’t presented that yet and they really haven’t told us what they might be asking of us. At this point, until we see that, we can’t assess it.”


He did say a food-processing company would be the most logical buyer for the DFA building.


“A number of people have looked at that facility down there and it lends itself to food processing,” he said. “That’s the way it was built. We definitely would like to see that building used. The most likely way is going to be some kind of food processing.”


Dalke agreed. Through her business, The Real Estate Center, she also is the broker for the DFA property.


“We’ve had other people look at it that were in the food business-none of which became interested enough to come back like these people have,” she said. “The building’s been looked at for other purposes, but it just didn’t suit for those kinds of situations.”


If MBA Poultry would decide to come, Dalke said the initial investment in the community would be significant.


“The numbers I received from the Department of Commerce indicated it would be a $36 million investment to put that together,” she said. “I think that’s impressive.”


Regardless of MBA Poultry’s decision, Dalke said the city should be complimented to be in the running.


“I am extremely proud of the fact they’re looking at Hillsboro, that we have the reputation of being receptive to business expansion in Hillsboro,” the mayor said. “I think that speaks very well for Hillsboro that we would be one of the communities that people come to rather than us having to chase them down all the time.


“One of the things all of Marion County needs is more people because of our retail sector,” she added. “We definitely need more people to shop in our stores and spend their money in Hillsboro.


“Anytime there’s an opportunity to have more people in the community, I think it could turn out to be a positive situation.”


She and Kleiber stressed it is far too early to know which way MBA Poultry will go.


“Normally, HDC or nobody else gives out information until there’s something to say,” Dalke said. “But because of the number of rumors, we felt it was necessary to make a statement.”


Even if the light turns green after the due-diligence process, the project will be slow in developing, she added.


“We have to realize this would be a long-term project because they have to identify the growers, the barns would have to be built, the chickens would have to be hatched and grown, and equipment would have to be installed,” she said.


“We’re not talking about anything happening here by the end of summer-that suddenly there’s 250 people needed,” Dalke added. “It would be a long-enough and slow-enough project getting started that I don’t think we’d see any immediate, dramatic changes in our community. Two hundred and fifty (employees) would be somewhere down the line.”

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