Economic Development Districts (EDDs) working together across regional boundaries can use federal and state investments to drive transformative economic impact across their regions. Rural regional organizations may have limited staff capacity on their own, but when partnered with other EDDs, these coalitions can have an outsized economic impact on their regions. Additionally, EDDs can use existing staff experience and capacity, in this case their experience with Revolving Loan Funds and lending, to support local food supply chains and build resilient food systems.
Bear Paw Development Corporation of Northern Montana (BPDC) led a coalition of five Montana EDDs in securing a $10 million grant from the United States Department of Agriculture Rural Development (USDA RD) Meat and Poultry Intermediary Lending Program (MPILP). The MPILP was established in 2022 to diversify and decentralize meat processing supply chains away from centralized, large-scale industrial facilities and towards locally owned modes of production. By establishing and supporting smaller-scale facilities across the country, the program aims to:
Source: USDA Webinar on MPILP program requirements
BPDC has used MPILP funds to establish the Montana Meat and Poultry Intermediary Lending Program Coalition in partnership with 4 other Montana EDDs:
This USDA-financed Revolving Loan Fund (RLF) supports small, Montana-owned meat and poultry processing operations throughout the rural 5-region area. Funds can be used by processing and packing facilities to meet their capital improvement and equipment needs in:
The BPDC region and Montana have extensive agriculture and ranching industries that support thousands of jobs across the region and state, making a meat processing lending program an important tool for supporting these local industries and supply chains. According to the USDA National Agricultural Statistics Service, in 2022 over 58.1 million acres of land in Montana were used for agriculture and ranching and Montana’s total agriculture sector was valued at $4.3 billion. In the Montana ranching industry, 2.1 million head of cattle comprise 83% of the state’s total livestock. In addition to this statewide economic growth, the BPDC region hosts a thriving ranching and processing industry that is vital to the regional economy. Supporting the region’s agriculture and timber industries was the second-highest economic priority for regional stakeholders in the 2022 BPDC Comprehensive Economic Development Strategy (CEDS). Agriculture, forestry, fishing, and mining industries are the second-highest employers in the region, accounting for approximately 2,400 jobs.
To market the availability of funds, BPDC’s loan services staff relied on existing relationships with meat processing facilities and regional stakeholders built through planning processes like the CEDS as well as past relationships built through their Economic Development Administration-supported RLFs. Through their EDA-supported RLFs, BPDC has been awarded $3.4 million over 5 awards since 1989 and has lent out over $20 million, leveraging $34 million in private investment to support the creation and retention of over 1,200 jobs.
Originally awarded $10 million from USDA with a 3-year spenddown goal, BPDC lent $1.9 million in the first year, with another $2.8 million approved by Bear Paw’s Loan Review Committee that is currently waiting on closing documents and USDA approval. The lending coalition aims to support Montana-owned small businesses and gives preference to facilities that are working to receive USDA Certification.
Speaking on the value of this program, Eric Seidensticker, Food and Agriculture Development Center Director at Montana Business Assistance Connection said:
“The partnership my organization has forged with Bear Paw Development Corporation represents inter-regional collaboration and innovation. By working together, we have been able to bring much needed capital and resources to rural businesses that are committed to their communities. The team at Bear Paw Development values my priorities just as much as their own. This is truly Montanans helping other Montanans.”
BPDC is the lead organization in the Coalition and holds monthly meetings with USDA RD staff and other lending coalition partner organizations. Each EDD originates their own projects and brings potential loans to the BPDC RLF Loan Review Committee for final approval. Having each EDD originate their own projects gives the program more geographic spread across the large 26-county region, while retaining uniform procedures by centralizing the approval process through the BPDC RLF Loan Review Committee. Additionally, each EDD either hosts or has access to the services of a Small Business Development Center (SBDC) that assists applicants in developing business plans and understanding program requirements. The SBDC staff in each region have been important partners as they can more easily travel to meet with potential applicants, work directly with potential applicants on business plans, ensure any collateral and purchased assets remain in good condition, and track progress on funded projects.
Recognizing the value of the program for the rural economies in their region, Paul Tuss, Executive Director at Bear Paw Development Corporation said:
“The Montana MPILP Coalition is a wonderful on-the-ground example of collaboration between Economic Development Districts in our state that focuses on advancing a critical sector of our economy. Adding value to the high-quality agricultural products we raise – in this case meat and poultry – will benefit our rural communities, create jobs, expand the tax base and strengthen our food supply chain. This project was funded and will continue to be successful because of the unique partnership that has developed between the five EDA-certified Economic Development Districts, who all share the common goal of enhancing Montana’s rural economy.”
National Priorities and Local Impact
BPDC relied on the CEDS planning process to make connections with local industries, learn about community needs, and identify prospective industry sectors they can support through their EDD programming. BPDC was able to translate a national funding agency priority from USDA (strengthening national food supply chain resilience) into local impact (supporting local small businesses and regional economies).
Existing Staff and Relationships
New funding opportunities don’t always require identifying entirely new stakeholders or building new working relationships. Existing partnerships that have developed through past projects may be able to supplement and enhance programming and EDD services in new ways.
Partnerships and Collaboration Matters
EDDs have a natural tendency to collaborate with one another based on their mutual interest in enhancing the economic vitality of regional economies. This project takes that collaboration one step further by utilizing interregional partnerships to secure funding from USDA that will help build an important sector of the economy for rural Montana. As the federal investment creates a new revolving loan fund, the grant funds will be utilized repeatedly for job-creating projects that will continue to bolster the region’s agricultural economy.
This case study was prepared by NADO Regional Development Researcher Andrew Coker ([email protected]).