McNeilus plant expected to provide up to 50 jobs

Published 12:00 am Thursday, June 12, 2003

DEXTER -- Sometime soon, the Revolution will begin to change the cement industry around the world.

Ground zero will be Dexter, where McNeilus Companies, Inc. dedicated a new plant Wednesday morning.

The McNeilus Revolution model drum could be the greatest advance in the ready mix cement industry, said Dan Lanzdorf, president of McNeilus Companies, Inc., an Oshkosh Truck Corporation-owned company.

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Lanzdorf told a dedication audience Wednesday morning, the first of the composite drums for ready mix will roll off the assembly lines at Dexter in July. The first 15 employees hired by the company to build the new drums watched Wednesday's ceremonies and heard Lanzdorf predict great things ahead for the company.

"Over 3,000 of the rear-loaded models will be produced at this plant and research into a front-loading model that could be manufactured here is underway," he said. "We expect them to be introduced to Europe and this plant will be the model for that expansion effort."

Because of the composite materials (polyurethane, filament, resin and acrylic urethane) used in the patented process to manufacture the drums, they are 2,000 pounds lighter than their steel counterparts.

In expressing his appreciation to all who made the facility a reality, Lanzdorf predicted, "This could be the start of a revolution that will sweep all over the United States today and Europe tomorrow."

Dexter Mayor Joe Gardner agreed.

"Ecstatic would be a pretty good word for the way we feel today," he said. "We've worked for about two years on this to get this thing rolling. Today is a momentous occasion."

McNeilus Companies, Inc. put $125,000 of its own money into the project.

Minnesota Trade and Economic Development provided a $165,000 "forgivable loan" to the city of Dexter.

Mower County loaned $2,880,960 to the DCA, plus $375,000 to the city of Dexter ($200,000 to be repaid by the city and another $175,000 to be paid through Tax Increment Financing payments) and another $175,000 loan to the DCA for administrative expenses. The latter will be repaid by the DCA through a second 10-year lease with McNeilus for the property or the sale of the property.

One state official said this is the way economic development should work in Minnesota.

"One of the things the governor has asked us to do, in terms of economic development, is to emphasize a regional approach," said Matt Kramer, commissioner of the Minnesota Trade and Economic Development. "The state can play a role in making that happen, but much of the money and the energy is going to happen at the regional level and that's what we want to encourage."

The city of Dexter is extending street and utilities to the site and erecting a water tower to serve the facility as well as other businesses and industries in the area.

The county's monies for the loan to the DCA and Dexter came from a $2.5 million gift to the county by Great River Energy, when they located an electrical generation plant in Pleasant Valley township.

Ray Tucker, 2nd District Mower County commissioner, spearheaded the county's role in the GRE project as well as the McNeilus facility.

The site is located in Tucker's 2nd District and Tucker is the county's representative on the DCA's board of directors.

"The real advantage Mower County had was that money from Great River Energy," Tucker said. "That is non-tax-generated money we were able to use on this project."

"It's been a smooth project," said George Brophy, president of the DCA said. "McNeilus is going to do as they said they were going to do. They're going to make drums here. This is the first place in the United States where they're doing this, therefore it has the highest probability that this would be an expanded site for an additional product line.

"Our whole hope is that this would be the first olive out of the bottle, in terms of development of the site between Austin and Rochester. This is just the start."

The project differs from others orchestrated by the DCA, according to Brophy.

"Most of the time we finance a company using our own account to do that," he said. "Most of the time it would be start-up or working capital. In this case, the DCA played out the role of the traditional land developer. We're the owner of the building. The financier for us has been Mower County instead of a bank."

Among the special guests were State Sen. Dan Sparks (DFL-Austin) and State Rep. Jeff Anderson (R-Austin), plus DCA vice chair David Crandall, board members Mickey Jorgenson and Jay Nelson, county commissioners Garry Ellingson, 5th District, county board chair, Richard Cummings, District and county board vice chair, and David Hillier, 3rd District, plus Craig Oscarson, county coordinator.

Any questions about the limited financial role of McNeilus Companies, Inc. were deflected by the DCA's Brophy and county commissioner Tucker.

"I have none whatsoever," Tucker said when asked if he had reservations about the county being the financier for an economic development project. "The real advantage that Mower County had was that Great River Energy money. That was the key to the process."

Tucker said he believes Mower County's financial interests in the project are protected by the agreement between the parties.

Lease payments by McNeilus are guaranteed for 10 years, plus provisions exist for both the number of jobs to be created -- 12 in the beginning and 50 later -- and

the wages paid, a minimum of $12 per hour.

"When you add it all up, Mower County is getting a lot of bang for its investment," said Tucker.

Lee Bonorden can be contacted at 434-2232 or by e-mail at