Andy Hagy, Nash County economic development director, stands in front of the former CIFI plant in Nashville, where Crump Group is expected to begin operations in 2022. Calvin Adkins / Carolina Public Press

A Canadian manufacturer of pet treats plans to renovate a vacant plant in Nash County and begin operations there, bringing 160 new jobs to Nashville. 

The mid-August announcement by Crump Group has the potential to help not only the Nash County employment situation but also the local sweet potato industry. Some of Crump Group’s most popular treats are made with sweet potatoes grown in North Carolina. 

The manufacturing and distribution center will be the first of its kind in the United States for the company. The operation will move into a 190,000-square-foot facility that Carolina Innovative Food Ingredients, also known as CIFI, occupied until April. Crump Group projects that the facility will begin hiring in November and start operations early next year. 

The average wage for Crump Group’s jobs will be $42,016, on par with Nash County’s average of $41,827, according to the N.C. Department of Commerce. The total payroll impact for the region is expected to reach more than $6 million.

The facility will represent a major expansion for Crump Group, nearly doubling its total employees. At present, Crump’s 200 employees operate out of a 110,000-square-foot facility in Ontario. The goal will be to make the two facilities mirror one another as much as possible, said Crump Group President Joe Crump.

The decision to expand into North Carolina was an easy one, he said. The company had existing business relationships with farmers in the state. North Carolina also produces about 60% of all sweet potatoes in the nation, according to the U. S. Department of Agriculture. 

Bouncing back 

CIFI operated out of the facility since 2015 but ceased operations in April. The facility marked a $20 million investment from CIFI and the creation of 64 jobs, according to a press release from the company in 2014. The facility specialized in producing dehydrated and juice fruit and vegetable products, including local sweet potatoes. 

CIFI’s parent company, Universal Leaf, announced plans to close down the operation, citing international pricing pressure and its single-product focus as challenges for the company. 

The closure was a major loss to the sweet potato market, according to Johnny Barnes, president of Barnes Farming & Farm Pak,  the largest sweet potato farm in the United States with 6,000 acres dedicated to the crop in nearby Spring Hope.

A worker’s glove sits a atop a basket of sweet potatoes harvested in Nash County in 2020. Photo courtesy of the North Carolina SweetPotato Commission

The proximity of the CIFI facility saved farmers money on shipping costs and created a reliable local market, he said.

After CIFI closed, farmers were forced to find other markets. Some farmers like Barnes ended up paying higher transportation costs to find markets farther away. Farmers with fewer resources were sometimes forced to dispose of their harvest because they weren’t able to find a market or pay the transportation costs.

The loss affected the city of Nashville as well, as CIFI was one of its biggest water and sewer customers. The city averaged $50,000 in monthly combined water and sewer revenue, the Rocky Mountain Telegraph reported on March 24.  The city expected the closure to cause an annual loss of $100,000 in water revenue and $230,000 in sewer revenue. 

The Crump facility will also be using the city’s water, according to Randy Lansing, the town manager. The city and company are currently in talks about what the expected water consumption will be. 

After the closure, Barnes reached out to Andy Hagy, director of economic development for Nash County, after seeing Hagy’s name in an article about the closure in April. He told Hagy to reach out to Crump. Barnes sells sweet potatoes to Crump and knew that the company was looking to expand to North America. 

Despite the building being vacant, it was not an easy sell on the market because the remaining equipment and layout were specific to food processing.

“It wasn’t your basic triangle-shape building on the inside,” Hagy said. “It was a special-use building for food processing. Just not anybody could take it and use it.”

He estimates that the facility could have been empty for easily two years and would have depreciated significantly. 

State and county incentives 

Crump Group received $1.6 million in financial incentives from the state through the Job Development Investment Grant approved by the state’s Economic Investment Committee.

The county was awarded up to $750,000 as part of a Community Development Block Grant approved by the N. C. Rural Infrastructure Authority, both approved last month. 

The Department of Commerce estimated the project could grow the state’s economy by $650.5 million and bring in $17.2 million in revenue for the state over the course of 12 years. 

 The city of Nashville did not offer any incentives, since the site falls outside city limits. 

The $1.6 million JDIG would be disbursed over the course of 12 years. As part of the grant, the company is eligible to receive potential reimbursement based on a number of factors, such as tax rates, labor availability and overall project development cost.

The CDBG awarded to Nash County will be applied toward renovations of the existing facility, including structural repairs, flooring upgrades and plumbing. The grant is awarded as renovations are completed. 

By having renovated buildings, state officials think that rural counties will be more competitive in attracting investors to their counties because the necessary infrastructure will already exist, said David Rhoades, communications director for the Department of Commerce. 

Finding and retaining a workforce 

To receive the JDIG annually, the company must meet certain benchmarks and continue to maintain them on a yearly basis. For example, the company must hire 80 employees by the end of 2022. 

The company will hire locally, Crump said. To train the necessary workforce, Crump and the county turned to Nash Community College, which offers courses and certifications for food processing.

Crump also made it clear that not all positions will require formal training and people with no experience would be considered for certain positions. 

The 160 jobs will be broken down with 128 being entry-level positions and 32 being managerial positions Crump said. The entry-level positions will be a mix of skilled and unskilled labor ranging from electricians to line workers. 

The company is currently in talks with other local employers about health care and incentives to determine competitive benefits. In order to be eligible for JDIG, the company must provide health insurance and pay at least 50% of the premiums for participating employees, according to the N.C. Department of Commerce. 

The health care requirement is an unusual one for the Canadian employer.

“It’s just entirely new for us,” Crump said. “ In Canada, the health care is free, so it is a little different scenario for us.” 

Even with incentives, the sweet potato industry at all levels is still dealing with a labor shortage, said Michelle Grainger, executive director of the N.C. SweetPotato Commission. 

The nonprofit organization promotes the consumer consumption of sweet potatoes by working with 40 businesses across North Carolina that have a hand in the industry, ranging from growers to equipment dealers and financial institutions. 

Across the industry, businesses have taken different approaches to recruiting and retaining workers ranging from subsidizing education at community colleges, offering a 401(k) and higher-quality health care, she said.

As the sweet-potato industry continues to grow, it needs more North Carolina manufacturing facilities, she said. For the last three years, the state’s sweet-potato acreage has increased with the USDA reporting 106,000 acres of sweet potatoes in 2020, a significant jump from the 82,000 acres reported in 2018. 

With the lack of manufacturers in the state, growers and sellers must send products out of state, even when the finished product will return to the state for distribution. 

“The longer the person is distant, the more gas, the higher the expense,” she said. “Ultimately, the expense is passed on to the consumer in the end.”

The addition of more diverse manufacturing facilities, like Crump, will allow the state to have more of a vertical business model and break into new markets with new sweet potato products, Grainger said. 

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Arturo Pineda is a former reporter with Carolina Public Press and Report for America fellow.