Sturgeon County councillors got some sticker-shock last week after one of their staffers proposed they give the county’s seed-cleaning plant $60,000 to hire a consultant.
Sturgeon County councillors referred a Jan. 22 decision to their March 12 meeting on whether or not to give the Morinville Municipal Seed Cleaning Co-op up to $60,000 to hire a consultant for financial and business planning services.
The co-op runs Sturgeon County's only dedicated seed-cleaning plant, which is located south of the Husky gas station in Morinville on 100 Street. Council heard the plant serves about 200 farmers a year, about half of which live in the county. Sturgeon County is a member of the co-op and part owner of the plant.
Farmers use seed-cleaning plants to filter rocks, weed seeds and other debris out of their crops so they can sell them for a higher price, co-op treasurer Ward Middleton said in an interview. Such plants are important for weed control and organic grain growers.
County council loaned the co-op $150,000 in 2009 to pay for upgrades to the plant. Prior to last year, it had not paid any of it back, instead asking for (and receiving) forgiveness on its annual payments each year.
Council heard last week that the co-op had actually made its 2018 payment of $16,698.98.
In an interview, Middleton said the co-op hired a new manager for its seed-cleaning plant two years ago (Cora Krywko) who put the facility’s books and procedures in order, allowing it to make a very slight profit in 2018 (not counting depreciation) and cover its loan payment.
“Financially, we’ve turned a corner,” Middleton told council.
Still, the plant has a lot of old technology and debt, he said in an interview. After talks with county councillors and administrators, the co-op felt it would be a good investment to put the cash it would get through loan forgiveness towards some strategic planning and a third-party look at the plant’s future.
“If we need to invest more money, what’s the best way to do it?”
County financial services manager Ed Kaemingh said a consultant who could offer such services would cost up to $60,000. He proposed that the co-op chip in about $33,400 of this through its 2018 and 2019 loan payments and the county cover the rest using contingency funds.
Mayor Alanna Hnatiw said she was “shocked” by this price tag, as she had been expecting a much cheaper look at the plant’s viability.
“Before even determining the viability of (the plant), we’re committing $60,000 to it, and I’m not comfortable with that.”
Middleton said in an interview that he also had a bit of “sticker shock” with Kaemingh’s proposal. The co-op had expected something like in-kind support, not more money.
Coun. Karen Shaw said this proposal was no different from the strategic planning the county did, and noted that the county was part owner of the seed-cleaning plant.
“We’re saying that we support agriculture and we want this plant to succeed.”
Council directed Kaemingh to come back in March with a plan that was cheaper and narrower in scope.
