Officials optimistic about plans for cheese plant

Glen Seeber

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If funding for an expansion to Clovis’ wastewater treatment plant is approved during a special city commission meeting on Monday, groundbreaking for a multi-million dollar cheese-processing plant could happen as early as January.

“I would be a little out of line if I predicted how the vote would go, but I am optimistic the commission will support the plan for local participation,” Mayor David Lansford said Saturday evening.

“I don’t know of anything at this point that would make them not want to vote for this,” Chase Gentry, executive director of the Clovis Industrial Development Corp., said Saturday.

He said an $8 million bond issue to be considered by the commission will be paid over a 20-year period by Southwest Cheese — with no obligation on the city’s part.

If approved, the proposal will result in the largest cheddar cheese plant in North America receiving its own treatment facility at the city plant.

Gentry anticipates a ground-breaking ceremony could take place in January, with production of cheese to begin in September 2005.

The plant would be located five miles south of Clovis on the Curry/Roosevelt County line. Officials have said it will create up to 700 jobs during construction, 200 full-time once the plant opens and 185 in related businesses. Gentry said more than 600 could see new jobs as a result of “spin off” businesses created by the cheese-production facility.

Southwest Cheese officials have also pledged an annual $100,000 donation to Clovis schools for the duration of the 20 years. The schools could use the money at their own discretion, Gentry said.

This would be a “nominal” amount replacing property taxes that will not be collected for 30 years, he said. With the tentative approval of $250 million in industrial revenue bonds earlier this month, the property where the cheese plant would be built would become city property and thus exempt from taxes until the bonds were paid off.

Lansford said $6 million of the bond issue to be discussed Monday will pay for an additional treatment cell at the city plant, with $1 million dedicated to a pipeline and lift station, and another $1 million to a storage area to hold effluent between treatment and its land application destination.

Southwest Cheese’s payments to the city will cover both the cost of operating the facility, and the debt service on the loan, Gentry said. An agreement provides for Southwest Cheese to pay the debt, even if the plant shuts down.

“The city produces 3 million gallons of wastewater per day, and the plant will produce 1.25 million gallons,” Gentry said. After the effluent has been treated separately, it can be mixed together and disposed of through an existing land application system.

Without the city’s participation in the effort, the cheese plant would need a $28 million treatment facility of its own, Gentry said. The issue could prevent the plant from locating in the region, he said.

“We’ve been trying to find a solution together that would be a ‘win-win’ for all involved,” he said.

The city’s participation — if approved Monday — would move the project forward. If the bond issue is turned down “it would be a setback,” he said.

Lansford said any federal funding that might be arranged will be applied to the $8 million operation, thus reducing the amount of debt service Southwest Cheese would have to pay.

Also to be discussed at Monday’s 9 a.m. meeting, held at the Clovis-Carver Public Library’s North Annex, is a New Mexico Finance Authority Application for $4.5 million. This would pay for pretreatment at the cheese plant.

Lansford said that debt service would be paid with revenues from an economic development tax approved by voters four years ago.

An industry gets use of the funding depending on the number of jobs created and what those jobs pay, he said. The money cannot be used for operational purposes, but for “something tangible,” such as a building, land, infrastructure or equipment.

The mayor said Gov. Bill Richardson has pledged another $1.5 million, which will be added to the $4.5 million to fund the pretreatment facility.

Gordon Smith, mayor pro-tem, agreed with Gentry that there’s no downside to the proposals. “This is the most excitement we’ve had,” he said.

Meanwhile, work is continuing on settling water issues involving the 3,000 acres where the 300,000-square-foot facility will be located, Gentry said.

“They (cheese officials) don’t want to purchase the land if the water rights are not there,” he said.

He anticipates a ground-breaking ceremony to take place in January, with production of cheese to begin in September 2005.