Ex-Seaboard executive involved in Premium Pork

Published 12:00 am Wednesday, April 16, 2003

Albert Lea is in competition with St. Joseph, Mo., not Elwood, Kan., for a new pork company’s headquarters and processing plant, according to City Manager Paul Sparks.

David Jones, Mayor of St. Joseph, confirmed Tuesday that his city had been approached by the same group that is considering a pork plant and headquarters in Albert Lea. The company told Jones it’s going by the name of Premium Pork Allied Producers, similar to Premium Pork, LLC, which is the name by which Albert Lea knows the company.

The offer to St. Joseph is the same, except that they have been told the facility would employ 1,000 workers with 200 corporate jobs rather than the 2,000 employee, 300 corporate-job facility Albert Lea had been told of.

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Sparks and Jones also confirmed Tuesday that one man behind the company is Rick Hoffman, a former executive of Seaboard Farms. In 1994 Albert Lea was disappointed by Seaboard when the company abandoned the city after operating a pork operation here for just over three years. The company had received substantial city assistance.

Nine years later, Hoffman is starting a new company and is considering Albert Lea for the home of its new $130 million hog-slaughter operation and corporate headquarters.

The city has laid down a set of requirements for the company in an effort to safeguard itself from the problems it had with Seaboard in the past. The company would be required to pay back any city funds used toward the project if the company were to back out, and, once the plant is built, would have to stay at least for the life of the tax-increment finance district &045; probably around 15 years &045; among other things.

Seaboard, under Hoffman, had also considered St. Joseph as well as Elwood in 2001 for a very similar package: a $125 million facility, 2,300 employees, a $100 million payroll and 4 million hogs processed per year. With the exception of the corporate headquarters, the deal had the same basic elements. St. Joseph and Elwood are directly across the Kansas-Missouri border from each other.

Seaboard told Elwood the facility would be built there, but after a year of planning and developing, the company withdrew its offer, stating that demand in Asian markets, which it would have targeted, was at an all-time low.

Shortly thereafter, Hoffman left the company.

Jones, the St. Joseph mayor, said he doesn’t have concerns over Hoffman.

&uot;I felt when Mr. Hoffman was here he was honest and up front with me,&uot; he said.

Jones said would be supportive of the company building in St. Joseph. The town had turned down the offer from Seaboard in 2001.

&uot;I was on the city council at that time,&uot; Jones explained. &uot;My main concerns were about the city’s infrastructure. But I was also concerned with Seaboard’s history.&uot;

Albert Lea City Manager Paul Sparks said he isn’t worried about Hoffman’s history with Seaboard or the similarities between the offer Seaboard had made and the one being made by Premium Pork.

&uot;He hasn’t been with that company for years,&uot; Sparks said about Hoffman.

About the similarities between the offers, Sparks said: &uot;This is a different deal than they were offering Elwood and St. Joseph. The numbers are similar, but Seaboard tended to raise a lot of their own hogs.&uot;

Sparks said that Premium Pork would buy theirs from farms in Minnesota and Iowa. That, combined with the corporate headquarters aspect, makes him think differently about the company than he might others.

&uot;If certain operations were to talk with us I’d be a whole lot more concerned about it, but with a cooperative like this one, it’s different,&uot; he said.

Sparks said that with a corporate headquarters in the city, the company would care about local problems.

&uot;They will be living here, not in an office in some other city,&uot; he said.

Some critics of the company have raised questions about the amount of waste the company would create.

Dick Rierson, an Albert Lea resident, said, &uot;This pork industry is a lot different than how we remember it.&uot;

Sparks defended the city’s stance.

&uot;I’m familiar with the industry,&uot; he said. &uot;I’m not sure why people think we don’t know the industry.&uot;

Sparks pointed to Austin’s Hormel, which he said processes 4 million hogs per year without great waste problems, even though he said their facilities are not &uot;state of the art&uot; like the new plant in Albert Lea would be. He also said Albert Lea’s old pork plant, most recently known as Farmland, had processed as many as 2 million per year when the plant was running.

He said state and federal laws prohibit the company from the type of waste that critics are talking about.

&uot;This is far more managable than these people are alleging,&uot; he said.

Henry Savelkoul, the attorney for Premium Pork, was unavailable for comment.