Mahnomen Baked Chips Brings New Jobs to Mahnomen

The City of Mahnomen’s Industrial Park is about to become home to its first business, the Mahnomen Baked Chips Company.  The Mahnomen Baked Chips Plant will manufacture baked, stackable potato chips.  The stackable chip will provide a healthier alternative to the more commonly known fried stackable potato chip.

This start-up company, developed primarily by Arlen Kangas, President of the Midwest Minnesota Community Development Corporation, is anticipated to create nearly forty new jobs in the Mahnomen area.

The HRDC assisted the City of Mahnomen in securing DEED Minnesota Investment Funds to help pay for equipment in the facility.

The HRFC partnered with the Joint Economic Development Commission, the City of Blackduck, Blackduck Telephone Company and Wells Fargo Bank to finance a project, which allowed the Anderson Fabrics’ ESOP to complete a buyout of its founding owner Ron Anderson.  The financing positioned the company to remain competitive by focusing management’s efforts on the company’s profit-making centers and directing resources to sales efforts to gain greater market share.

Anderson Fabrics, Inc., founded in 1980 by Ron Anderson, is now one of the largest manufacturers of custom-made draperies, window blinds, pillows, and bedspreads in the United States.  It is the largest employer in the City of Blackduck and one of the top manufacturers in Beltrami County, currently employing approximately 338 people.  In addition to its manufacturing facility, Anderson Fabrics operates a retail outlet shop in downtown Blackduck, which draws visitors from around the area.  The employee-owned company is an excellent example of a home-grown entrepreneurial success in our region.

Currently, the HRFC Revolving Loan Fund (RLF) consists of an asset base of $4.1 million with 24 active EDA loans and 4 active flood loans.  Over its 28-year history, the RLF has made $11.4 million in loans partnering with $41 million in private funds and $12.9 million in other public funds.  Jobs created and retained during the programs existence amounts to 4,469 to date.  This year has been a busy one with four additional borrowers receiving RLF funds totaling $510,000 and $350,000 in funds are committed to projects in process.

In addition to the activities of the HRFC RLF, staff has been active in assisting with the administration of several city and private revolving loan funds, including the cities of Blackduck, Bagley, Mahnomen, and the Blackduck Telephone Company.  In the past, applications for funding from these RLFs have been minimal and underutilized; however, a combined 11 applications were received and funded this year alone.  Projects consisted of storefront renovations, housing rehabilitations, and new start-up businesses.

If you have business financing needs, the HRFC may be able to assist you.  Please contact Tiffany Fettig at 218-333-6534, or refer to our website.

As the Federal Economic Development Administration’s (EDA) designated Development District, the HRDC develops a Comprehensive Economic Development Strategy (CEDS) every three years, which is intended to serve as a guide for the Region’s economic development activities.   This past year, with the assistance of a committee consisting of businesses, lenders, economic development professionals, workforce representatives, chamber of commerce directors, union representatives and private individuals, the HRDC developed its new CEDS.  Through this process, we assessed the economic development issues in the Region, and subsequently developed strategies to address them.

Though many challenges were identified, a few of the Region’s most pressing economic development challenges include: 

• Global Competition:  Our businesses now face competition on a global basis, meaning they can no longer compete by being “cheaper”.  Instead, they must compete by providing a better product, which requires improved productivity and efficiency created by technology, and skilled employees who are innovative.
• Workforce:  Many of our employers experience significant difficulties recruiting the skilled and innovative employees they need to remain competitive.
• Retention of skills and knowledge:  Our region struggles to retain the skilled and knowledgeable people we are graduating from our schools.  We lose a valuable resource when our educated students leave to find employment elsewhere.
• Development of skills and knowledge:  Parts of our region are falling behind in high school graduation rates and standardized test scores, creating a workforce that cannot meet the challenges of today’s jobs.
• Technology: Some of our rural areas still lack essential telecommunication technologies that improve business productivity and competitiveness.
• Small Business and Entrepreneurial Business Assistance:  Our Small Business Development Center offers a comprehensive array of services, but because they serve such a large geographic area, not all areas are able to receive regular assistance.
• Infrastructure: Areas of the region do not have industrial lots for business development.  Some areas also lack necessary infrastructure in existing lots.
• Energy Costs:  Businesses report they are struggling because of the high cost of energy.  The increase impacts both their on-site operation costs, and also transportation costs.

While we cannot list within the scope of this report the individual strategies developed to address the Region’s economic development challenges, the general areas where our strategies were focused include the following:

• Developing and expanding resources that improve technology, efficiency and global competitiveness in the Region’s businesses.
• Undertaking programs and projects which increase the skill and knowledge levels of the Regions employees.
• Encouraging the expansion of the most updated telecommunication services throughout the Region.
• Ensuring the Region has adequate business development sites.
• Promoting programs and projects which increase and improve access to the Region’s business and entrepreneurial business development and assistance resources.
• Exploring sustainable and balanced utilization of the Region’s resources in developing renewable energy resources.

Over the coming years, the HRDC will continue to focus its efforts on implementing and supporting projects which are designed to address the Region’s challenges.

For more information on our Economic Development Initiatives, please visit our Economic Development Past Projects page featured on our website.

2007 Comprehensive Economic Development Strategy
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