JONESBOROUGH, Tenn. (WJHL) — A local agriculture cooperative’s quest to build a local meat-packing plant will get a major boost Monday if the Washington County Commission finalizes approval of $2 million in federal ARPA funds for the project.

The Appalachian Producers Cooperative (APC) has a plan, a board, bylaws and a selected location for a facility that could eventually process up to 125 head of cattle, pigs or sheep per week. The county’s commitment of $2 million in American Rescue Plan funds represents 20% of the estimated all-in cost for everything from land and building construction to equipment.

A resolution giving final approval to county ARPA funds is on Monday’s agenda. It includes a clause that could result in some payback over 10 years, provided the operation is paying “distributions” to members or patrons based on its profits.

This image from a state of Tennessee website shows the site of a proposed meat processing facility (bordered in blue) in Telford, Tenn. The Jonesborough flea market is to its right and Grandview Elementary School is in the far left of the photo. (State of Tennessee)

APC has 6.9 acres at 2782 U.S. Highway 11E under contract and plans to close on the $375,000 purchase this spring. The land, owned by local developer Joe Wilson, is just west of the Jonesborough Flea Market on the south side of 11E. It lies almost directly across from the Washington County Industrial Park and is less than a mile east of Grandview Elementary School.

Washington County meat-processing plant: Fast facts

  • What: Modern meat-packing plant capable of processing up to 125 head of cattle, pigs or sheep a week.
  • Where: 2782 U.S. Highway 11E, Telford.
  • When: Construction could begin in late summer 2023, and the plant could be operational by fall 2024.
  • Who: Newly farmed Appalachian Producers Cooperative.
  • Why: Meet consumer demand for locally-sourced meat, help farmers gain better margins by selling more “finished” animals.
  • Cost/economic impact: $10 million for construction, land acquisition, equipment and other start up costs. Up to 26 new jobs by year three with estimated payroll of $1.6 million.

The plant has been discussed for over a year, and some community members have expressed concerns about its location, citing everything from noise and odor to traffic and potential strain on the water and sewer system.

Advocates say the plant will benefit local farmers and consumers, create minimal noise, odor and other drawbacks often associated with slaughterhouses. They add that it will help the local economy and the environment by creating jobs (up to 26 of them) and decreasing the carbon footprint of produced meat products.

Wade Farmer, an accountant and local farmer who has been aiding the ACP in details of its funding process and incorporation as a cooperative, reviewed the proposal’s details with News Channel 11 and answered questions surrounding concerns community members have raised.

The plant will be designed for slaughter and meat production of pork and lamb, though it’s expected to produce only beef at the start. Members of the recently formed cooperative hope to begin construction of the $10 million plant in late summer and begin processing animals in the fall of 2024.

They’ve secured one Appalachian Regional Commission (ARC) POWER grant for about $1 million, have another $2 million grant in the pipeline, and are going to borrow $5 million from one of several banks they’ve been in discussions with.

The county’s resolution to authorize an “Interlocal Agreement” for the funds puts the county in line for some of its investment to be returned for the next 10 years. Any shared dividends from a profitable year would include roughly 20% back to the county. If the operation nets $400,000 in 2026, for instance, the county would receive $80,000 (or whatever its percentage investment ends up being).

Farmer said the building, set to cost $6 million, will be closely modeled on the recently opened “Appalachian Abbatoir” in Charleston, W.V.

A long-discussed idea

The potential for helping fund a slaughterhouse has been under discussion at the county commission level since early 2022, but discussions about the need for additional local meat-processing capacity stretch back at least five years.

“Before the pandemic, farmers who wanted to process their animals locally were looking at six to eight-month delays,” Farmer said. Those waits jumped to close to two years starting in 2020 and remain at more than a year today.

Farmer said those bottlenecks create a couple of primary problems, one for farmers and one for consumers.

For farmers, the highest-margin way to raise and sell cattle is by keeping them all the way up through the “feeding” stage, rather than selling them after calving, or “raising” them to about 900 pounds and sending them off to corporate feed lots for the adding of the final 400 pounds or so of weight.

With local processing availability limited to two small facilities in Greene County and another in Washington County, Va., farmers were often essentially forced to ship cattle that they’d prefer to keep through the feeding stage to Midwestern feed lots.

“Those last 400 pounds have more dollars per pound than the others do, so that farmer doesn’t have a choice,” Farmer said. “We all do different product lines and we all have different niches, but this gives them a choice, and they can finish those and get those higher dollars or they can sell them at 900 (pounds) or sell them at 500.”

On the consumer side, those farmers have a market in restaurants wanting to sell locally-produced food and consumers wanting to buy so-called “freezer beef” from local farmers. Demand has far outstripped supply in both those areas for several years, and Farmer said the trend of people wanting to know where their food comes from is only increasing.

Right now, consumers can’t always get a quarter or half-steer from a local farmer they know — or go in together with another family or two — because of backlogs. That’s one of the first things the co-op hopes to alleviate.

“The first thing we’re going to try to do is farmers that want to try to bring beef to us, or someone that tells the farmer they want it processed (locally),” Farmer said. “Before, if you came to me there was no way you could tell me where to take it because I had to get it in for you eight months before.”

Farmer said he has helped answer commissioners’ questions over the past year about why the project merits the use of federal public funds. He said banks have told the group they’re not willing to extend beyond the $4 million construction line and additional $1 million line of credit, making grants a necessity, at least in the case of the cooperative.

The federal government has helped fund a number of similar facilities, many of them larger than the one planned, Farmer said.

“The USDA has put millions into it,” he said. “I think that breaks down the capital barrier, and I will tell you, had the Washington County Commission not stepped up and done this seed money, I don’t see how we do it.”

APC members and people from the Appalachian Resource, Conservation and Development Council — which is slated to be the pass-through agency for grant funds — have visited similar facilities.

Farmer said the group has done extensive research and believes the positives will far outweigh any negatives.

“If your goal was to benefit agriculture, which is … the number one industry in the state of Tennessee, if you want to help preserve this way of life, then here is a way to do it,” Farmer said of the group’s message to commissioners.