Jennie-O to ask city to vacate portion of the former Hwy. 40 for a possible corporate expansion
WILLMAR — Jennie-O Turkey Store of Willmar will ask the City Council to vacate a portion of former state Highway 40 in front of its headquarters and production plant for a possible expansion project.
Jennie-O will make its request to the council’s Community Development Committee at 4:45 p.m. Thursday at the City Office Building.
Community Development Director Bruce Peterson will ask the committee to recommend the council set a public hearing Feb. 3 to consider vacating that portion of former Highway 40 from the intersection with Willmar Avenue Southwest west to the Hoting property, which is located at the intersection with County Road 5.
The State of Minnesota turned back Highway 40 to the city a number of years ago and the city renamed the highway Industrial Drive Southwest.
Steve Renquist, executive director of the Kandiyohi County and City of Willmar Economic Development Commission, said he and Peterson have been working with Jennie-O on a process that began five years when they looked at vacating Highway 40 and some of the steps needed to lead to potential Jennie-O expansion.
The process was placed on hold until now, Renquist said.
“With the improved economy and continued strong financial performance of Jennie-O, they find themselves in the position where they can possibly expand their corporate offices, possibly looking at a two-phase project,’’ he said.
Renquist said expansion onto the existing corporate offices could happen as soon as this summer. The second phase, although not defined at this time, would expand northward across former Highway 40 into a 27-acre tract in the new industrial park.
Renquist said the expansion of the corporate offices is a strong indicator that Hormel, Jennie-O’s parent company, is willing to allow Jennie-O to maintain its independence rather than being combined with Hormel’s corporate headquarters.
Renquist said the office expansion wouldn’t make as much sense if it didn’t look like someday there could be other expansion, and he said the other expansion probably wouldn’t happen if the corporate offices weren’t here. So it all ties together, he said.
“We know in economic development when a corporation spends a significant amount of money to do a physical act, that that’s the likelihood of the continuation of those corporate offices here in Willmar, and the Willmar area is strong,’’ he said.
“We also know that the expansion of the corporate offices increases the likelihood that someday in the not-to-distant-future that there could be an expansion either to the production side or the distribution side,’’ he said.
Renquist did not disclose a price tag. But he said the corporate offices would be less than $10 million and the production facility would be more.
Renquist said the city’s development office and EDC will recommend the council work with the company, including proposing a “pay-as-you-go’’ tax increment financing district to fund the cost of right-of-way work and relocating a considerable amount of utilities in the highway ditch.
Renquist said moving the utilities will not be cheap.
“Jennie-O will pay for that and the tax increment finance basically will pay them back,’’ he said.
“But it’s a cost some people may have felt (is) a city obligation to prepare the environment in which growth can happen. This particular case, the corporation is paying for the infrastructure development to allow the growth and we’re just paying them back.’’