A request for emergency funding from Matanuska Maid Dairy has been approved by the state Board of Agriculture and Conservation to either aid the state-owned business meet market challenges or prepare it for sale by the end of the year.
According to a press release from the state Department of Natural Resources, Mac Carter, chairman of the board of directors for Matanuska Maid, laid out details of how the $600,000 line-of-credit would be used. “The funds would pay for the dairy's operating expenses when necessary, for independent monthly review of its income and expenses, and for obtaining independent expert advice on how to get the most value from the dairy,” Carter wrote. “If necessary, the funds could also pay for development by Aug. 1 of a plan to shut the dairy down by Nov. 1.”
Mat Maid has been losing money despite its ability to make $15.5 million in gross revenue, according to previous years' annual reports.
“I asked the state for support to privatize Mat Maid last year,” said Joe Van Treeck, president and chief executive officer of Mat Maid. “Now it is time to take real steps and do something, this will help.”
While Mat Maid has operated for 20 years with no direct state funding, and has strong public support, it posted operating losses of $265,000 in 2005, and $465,000 in 2006.
Increasing milk costs, unfunded mandates from the Department of Homeland Security, and a diminishing source of local fresh dairy milk are factors attributing to the dairy's losses.
“It is prudent for the BAC to consider various ways to meet its statutory obligations to the Agriculture Revolving Loan Found to maximize the value of the dairy's land, facilities and brand for the state,” said Rhonda Boyles, chair of the BAC.
The Agricultural Revolving Loan Fund is the sole shareholder in the Creamery Corp., the owner of the dairy.
“The BAC will make it possible for farmers to keep working their herds, and the dairy producing Mat Maid milk for Alaska consumers, while the corporation considers new business models, and the BAC obtains results of an appraisal it requested earlier this month,” Boyles said in a release.
Rob Stapleton can be reached at
rob.stapleton@alaskajournal.com.
