AgPlus Funders Forum aims to improve access to agricultural business financing

UC ANR Healthy Communities Blog
By Pamela Kan-Rice

To enhance funding for food and agriculture businesses in the Central Valley, more than 60 people involved in small business finance gathered at the AgPlus Funders Forum Dec. 12 to contribute ideas.

Representatives from financial institutions, economic development organizations, universities, government agencies and innovative funders like community development financial institutions (CDFI) attended. Participants shared innovative financing tools for business and discussed obstacles for people in rural communities to access capital at the forum at the UC Agriculture and Natural Resources building in Davis.

Two primary challenges faced by people trying to start a new business are figuring out how to get started – such as their supply chain – and gaining access to capital to finance their endeavor, according to keynote speaker Glenda Humiston, University of California vice president for agriculture and natural resources.

“There are actually an array of sources of capital beyond just the traditional bank loan, the problem is people don’t know about them or how to access them,” Humiston said. She added that much more capital could be available to Central Valley businesses if residents would invest locally. “If you had brought home just one percent of the retirement accounts held by people in the AgPLUS region back in 2010, you would have had over $1 billion to invest in this region,” she said.

Marc Nemanic of 3CORE, Carrie Ellinwood of U.S. Small Business Administration, Ismael Herrero of Fresno State’s Office of Community and Economic Development, and Catherine Howard of Northern California Community Loan Fund discussed some of the challenges for financing new businesses and alternatives to traditional bank loans.

Nemanic noted that many millennials are carrying student loan debt, which may make them averse to taking on more debt or prevent them from qualifying for business loans.

Howard said her organization is creating a tool to help people satisfy collateral requirements for credit.

To build their businesses, entrepreneurs often need technical assistance so Herrera’s office pairs young companies with experienced mentors and other services. Herrera said he is working to create public and private partnerships in rural communities, such as commercial kitchens for people to turn farm produce into value-added products to sell at farmers markets.

Panelists pointed out that jobs in the gig economy, such as driving for Uber or Lyft, don’t provide the stable income that tradition lenders seek in borrowers so they need to create a flexible product.

In the afternoon, participants split into four groups to focus on identifying opportunities for supporting economic development, supporting small business and microenterprises, effective intermediaries to connect investors with entrepreneurs, and regional finance funds. Each topic was discussed by a diverse group of people as peers and experts, bringing their own expertise to the table.

To address the interplay between higher education, student debt and the structural changes in the nation’s economy, Meg Arnold, who moderated the session, said she could foresee policy implications.

“Student debt is not forgivable,” said Arnold, managing director of Valley Vision. “At the same time we are making a four-year university degree both more necessary and less affordable, the economy is also changing, to the point that some graduates may need to think of self-employment or gig economy employment.”

The discussions identified many other challenges for the food and agriculture sectors in rural parts of the state that need to be overcome to access capital.
“We need everybody who participated today to share those examples of where something kind of unique or innovative is really working,” said Humiston.

Ideas generated during the forum will be used to inform the work of the Central Valley AgPLUS Food and Beverage Manufacturing Consortium, which hosted the AgPlus Funders Forum. The information will also be used by Humiston to update the 2012 Access to Capital Report by California Financial Opportunities Roundtable (CalFOR). The report highlights financial needs for businesses in California, reviews financial tools and capital sources and provides policy recommendations. Humiston will also convey the outcomes to the California Economic Summit.

The AgPlus Funders Forum was sponsored by Chase Bank, Valley Vision, the Center for Economic Development, First Northern Bank, the Federal Reserve Bank of San Francisco, Employment Training Panel, Blue Tech Valley, Fresno State Community and Economic Development and UC ANR.

Above: Glenda Humiston discusses funding sources that many people are not aware of.

Go to full story at UC ANR Healthy Communities Blog

Equity firm doubles down on Smittcamps with Lyons deal

November 14, 2017

The Business Journal

A private equity firm with offices in New York and San Mateo has announced a strategic investment in Fresno-based Lyons Magnus, producer of food-service products including fruit toppings, sauces, juices and syrups.

The financial terms of the investment by Paine Schwartz Partners was not disclosed. Bob Smittcamp, whose family has owned Lyons Magnus for more than 46 years, will continue to lead operations as chairman and CEO. He will also remain a “significant” shareholder in the company, according to a news release.

The executive team of Lyons Magnus — Kent Walrack, Jim Davis, Kris Porter, Jon Parker, Phil James, Brad Kirk and Steve Twet — will continue in their current roles in the business.
In a statement, Smittcamp said, “My family and I have dedicated the last 46-plus years to growing Lyons Magnus, and I believe that our decision to partner with the team from Paine Schwartz will help take our Company to the next level. Paine Schwartz brings extensive experience and understanding of the fruit business and the food-service industry. I want to thank our strong team of dedicated and long-term employees, who played an important role in building Lyons Magnus into an industry leader. With the benefit of additional expertise and resources from Paine Schwartz, we look forward to continuing to provide customers with the high quality and unique portfolio of products they expect from us.”

This strategic investment deepens Smittcamp’s relationship with Paine Shwartz Partners, as the equity firm previously made a strategic investment in Wawona Packing Co., the peach farming and packing operation founded by Bob Smittcamp’s father, Earl, in 1948.

Go to full story at The Business Journal

GO-Biz partners with CMTC to promote ‘CA Made” manufacturing labeling program

For Immediate Release
Monday, November 20, 2017

Sacramento, California. – The Governor’s Office of Business and Economic Development (GO-Biz) today announced a partnership with California Manufacturing Technology Consulting (CMTC) designed to increase the benefits for businesses that participate in GO-Biz’s recently launched ‘CA Made’ state labeling program for manufacturers. The partnership provides CA Made manufacturers with access to the statewide benefits of CMTC’s ‘Made in California’ program.

“Our partnership with CMTC will increase the visibility of the CA Made program and provide manufacturers with improved access to suppliers, business-to-business networking and events, and technical assistance specific to the needs of manufacturers,” said GO-Biz Deputy Director Jesse Torres. “CA Made manufacturers will now enjoy a broad expansion in program benefits to support their manufacturing operations and marketing efforts.”

“Since launching in 2011, CMTC’s Made in California program has grown to include more than 900 small- and medium-sized manufacturers. Through this partnership with GO-Biz and the CA Made program, we will significantly enhance the ability of California manufacturers to promote products that are made in California,” said CMTC’s President and CEO Jim Watson.

CA Made is a state labeling program designed to encourage consumer product awareness and promote the purchase of products manufactured in California. The program is administered by GO-Biz. CA Made provides the following services to approved products:
A license to use the CA Made label on products, packaging, and point of sale merchandising.
Placement of the product and company biography on the CA Made website.
Information on services from program partners.
Marketing via GO-Biz’s social media sites (e.g. Twitter, Facebook).
Access to CMTC’s Made in California partnership benefits.
For more information on CA Made, visit http://camade.ca.gov/.

CMTC’s Made in California Program promotes California manufacturers, brands, and product lines through marketing, events, and business-to-business networking opportunities. CMTC is affiliated with the U.S. Department of Commerce’s National Institute of Standards and Technology and is part of the Hollings Manufacturing Extension Partnership (“MEP”) Program.

About Governor’s Office of Business and Economic Development (GO-Biz)
Established in 2012 by Governor Brown, GO-Biz serves as California’s single point of contact for economic development and job creation efforts. GO-Biz offers a range of services to business owners including: attraction, retention and expansion services, site selection, permit streamlining, clearing of regulatory hurdles, small business assistance, international trade development, assistance with state government, and much more.

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Contact: Sid Voorakkara, (916) 680-0837; sid.voorakkara@gov.ca.gov

GO-Biz approves $69M in tax credits for 90 companies, adding 6,200 CA jobs

For Immediate Release
November 16, 2017

Sacramento, Calif. – Today, the Governor’s Office of Business and Economic Development (GO-Biz) announced that the California Competes Tax Credit (CCTC) committee approved $69 million in tax credits for 90 companies projected to create 6,236 jobs and make $1.2 billion worth of new capital equipment investments across California. View the complete list of approved companies and award amounts.

“The California Competes Tax Credit encourages companies from around the world to locate, expand and add good paying jobs in California,” said Panorea Avdis, GO-Biz Director and Chair of the California Competes Tax Credit Panel. “In just three years, hundreds of companies have made commitments to expand in the state and GO-Biz will continue to host informational workshops and work with our regional and local partners to ensure companies of all sizes know about and apply for these tax credits.”

GO-Biz Director Panorea Avdis convened the committee, which includes Treasurer John Chiang, director of the Department of Finance Michael Cohen, and Senate appointee Denise Zapata and Assembly appointee Madeleine Janis, at the California Department of Food and Agriculture auditorium in Sacramento.

“This tax credit was the decision-maker for our company to add manufacturing jobs here in California,” said John Barrett, Chief Financial Officer, ReAction Optics. “As a third generation Californian, I want these jobs to be here, but as an executive, I have to make business decisions. This credit ensures our long-term growth happens right here at home.”

In 2013, Governor Brown created the California Competes Tax Credit to focus on helping businesses grow and stay in California. Since 2014, GO-Biz has allocated $622.8 million to 865 companies projected to create 83,414 new jobs and make $15.7 billion in new investments.

“Our company set out to reduce traffic congestion and vehicle emissions and invented the foldable electric vehicle,” said Peter Lee, CEO and Founder of Urban 626. “California is where the idea was founded, and because of the California Competes Tax Credit award, it’s where the URB-E will be manufactured.”

About California Competes
The California Competes tax credit is part of the Governor’s Economic Development Initiative (GEDI) which Governor Brown signed legislation to enact in 2013 (AB 93 and SB 90). GO-Biz evaluates the most competitive applications based on the factors required by statute, including total jobs created, total investment, average wage, economic impact, strategic importance and more. Companies are exempted from paying state income taxes in the amount awarded.

About Governor’s Office of Business and Economic Development (GO-Biz)
Established in 2012 by Governor Brown, GO-Biz serves as California’s single point of contact for economic development and job creation efforts. GO-Biz offers a range of services to business owners including: attraction, retention and expansion services, site selection, permit streamlining, clearing of regulatory hurdles, small business assistance, international trade development, assistance with state government, and much more.

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Contact: Sid Voorakkara, (916) 680-0837; sid.voorakkara@gov.ca.gov

Governor’s Office marks Manufacturing Awareness and Appreciation Month with recognition of Valley events

Above. Secretary Karen Ross (center), California Department of Food and Agriculture, and Secretary Alexis Podesta (left), California Business, Consumer Services and Housing Agency (holding frame), and supporters (from left) Robert Sanger, California Manufacturers and Technology Association; Gene Russell, Manex; Tammy Cronin, Valley Vision; Dorothy Rothrock, California Manufacturers and Technology Association; Dan Ripke and Michael Suplita, Chico State Center for Economic Development; and Ismael Herrera, Fresno State Office of Community and Economic Development.

Download News Release

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November 1, 2017

FRESNO- Tuesday, Oct. 31, 2017, ended a month-long set of manufacturing events in the San Joaquin Valley and was recognized by the Office of Governor Jerry Brown as Manufacturing Awareness and Appreciation Month. In honor of this declaration, the governor hosted a photo op with Secretary Karen Ross, Department of Food and Agriculture, and Secretary Alexis Podesta, Business, Consumer Services and Housing Agency, who presented the proclamation to manufacturing representatives and supporters.

“The manufacturing sector is crucial to the California economy, and I thank them for their contributions,” as stated in Governor Brown’s proclamation.

Manufacturing Month kicked off on Tuesday, October 3, with numerous local manufacturers opening their facilities for guided tours to high school students interested in manufacturing careers, and was followed by the official Manufacturing Day on Friday, October 6.

On October 18, Fresno County Office of Education hosted the Career Tech Expo in Fresno, providing students and parents insights on the many career options available in industry sectors. Thousands attended the Expo which included hundreds of businesses and exhibitors.

Friday, October 20, marked the groundbreaking for the Fresno County Superintendent of Schools Career Technical Education Charter. Set to open summer 2018, the high school will welcome a freshman class of 125 in a program that links education directly to industry career opportunities.

On Thursday, October 26, the Office of Community and Economic Development co-hosted the inaugural South Valley Industrial Summit in Tulare, Calif. The Summit provided the opportunity to recognize the achievements by industry-led, community-supported partnerships that reinforce economic growth in the South San Joaquin Valley. More than 200 people attended the event which included breakout sessions with discussions on a wide range of topics. Representatives from Faraday Future, the electric vehicle startup company which recently opened a Hanford facility, and electric bus manufacturer GreenPower Bus gave keynotes.

 

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Business and industry exhibitors were available for participants to get more information.   Faraday Future representatives give keynote at the Summit.
     
To learn more about the Summit, go to: http://centralvalleymfg.com/home/south-san-joaquin-valley-industrial-summit/

 
 
 

Large rural manufacturers may score higher on innovation than urban

October 24, 2017

Daily Yonder
By Bryce Oates and Tim Marema

Rural areas may be as innovative as urban ones in some instances. The finding contradicts conventional wisdom that urban areas have a lock on innovation.

Large manufacturing firms in rural America are at least as likely as similar urban firms to use innovative methods that can contribute to job creation and increased earnings, a new report says.

Though preliminary, the study may indicate that there are exceptions to the oft-repeated rule that economic innovation is the nearly exclusive purview of urban-based businesses.

“The findings in this report regarding the prevalence of rural innovation challenge the conventional wisdom that rural nonfarm innovation is relatively rare and idiosyncratic,” the report says. While large rural manufacturers had an innovation edge, that finding did not hold true for small and medium-sized rural manufacturers, the study shows. (Chart included in article.)

The study by the USDA’s Economic Research Service looked at non-farm rural economic sectors like manufacturing and services, which have not received as much attention from rural economists as agriculture-related activities. The research looked at the years 2010-2014, which correspond with the period of economic recovery following the Great Recession.

Go to full story at Daily Yonder.

Madera farmer makes almond butter

August 28, 2017

The Madera Tribune
By Cassandra Garibay

The grocery aisles in California are filled wall-to-wall with a seemingly endless variety of spreads, almond butter included. Since California is the primary location of almond orchards, most people have no difficulty buying locally. However, there is a catch.

Kahal Farm’s operations manager Mallvinder Kahal and Amandeep Kahal, Mallvinder’s sister, noticed that most of the locally grown almond products being sold were packaged outside of California. Therefore, despite their California labels, the almonds were processed and packaged outside of California, then sold back to local stores.

“As farmers, you see that, and you see a lack of accountability, because we put a lot of effort into growing a quality crop,” Kahal said.

Kahal Farms, founded in 1985, is a family-owned farm in Madera County. What once started as a wine grape vineyard, expanded to 1,200 acres of primarily almond orchards spread out between Madera and Merced.

Go to full story at The Madera Tribune

Above: Kahal Farms operations manager Mallvinder Kahal tries to get a taste of his almond crops. He has also expanded to producing almond butter with his sister Amandeep. Wendy Alexander/The Madera Tribune.

After decades of pushing bachelor’s degrees, U.S. needs more tradespeople

August 29, 2017

PBS NewsHour
By Matt Krupnick
The Hechinger Report
@MattKrupnick

FONTANA, Calif. — At a steel factory dwarfed by the adjacent Auto Club Speedway, Fernando Esparza is working toward his next promotion.

Esparza is a 46-year-old mechanic for Evolution Fresh, a subsidiary of Starbucks that makes juices and smoothies. He’s taking a class in industrial computing taught by a community college at a local manufacturing plant in the hope it will bump up his wages.

It’s a pretty safe bet. The skills being taught here are in high demand. That’s in part because so much effort has been put into encouraging high school graduates to go to college for academic degrees rather than for training in industrial and other trades that many fields like his face worker shortages.

Now California is spending $6 million on a campaign to revive the reputation of vocational education, and $200 million to improve the delivery of it.

“It’s a cultural rebuild,” said Randy Emery, a welding instructor at the College of the Sequoias in California’s Central Valley.

Go to full story at PBS NewsHour

Above: Student Kalei Kipp in Cedar Crest High School’s welding program in Lebanon, Pennsylvania, during the 2016-2017 school year. Three percent of welders in the U.S. are women. Photo from PBS NewsHour’s Student Reporting Labs series “Outside the Box.”

AgPlus to host Funders Forum in October

News Release

June 15, 2017

FRESNO – The Central Valley AgPlus Food and Beverage Manufacturing Consortium (AgPlus) announced today it will host the 2017 AgPlus Funders Forum in October at the McClellan Conference Center in Sacramento County. The two-day event is designed to share innovations in financing tools for business and to determine the feasibility of a regional finance fund to support new and existing food and agriculture businesses and nonprofits in the Central Valley.

Day One of the Forum will be a working session for financing experts, with presentations, in-depth policy discussions and breakout sessions. On Day Two,  a wide array of business/finance advisors and food system partners will provide insights and updates in a trade show environment with exhibition booths, workshops and more.

Event details: AgPlus Funders Forum, Oct 17-18, 2017, McClellan Conference Center in Sacramento. For further information, please contact the following AgPlus team members.

Erik Cherkaski (Fresno) echerkaski@mail.fresnostate.edu, 559-278-4575
Adrian Rehn (Sacramento) adrian.rehn@valleyvision.org, 916-325-1630
Dan Ripke (Chico) dripke@csuchico.edu, 530-898-4598

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In 2016, AgPLUS was awarded an USDA Rural Development California Grant for its AgPLUS Rural Business Resources Assistance Program. The program provides workshops and technical assistance to small and emerging rural businesses throughout the Sacramento, San Joaquin Valley, and North State regions. 

3rd Annual Manufacturing Summit rousing success

FRESNO – Over 850 registered for the 2017 Manufacturing Summit-Thriving in the Valley, including 205 local students. The day was dedicated to the “thriving” manufacturing community in the San Joaquin Valley.

The third annual event took place at the Fresno Convention Center and featured 85 vendors from manufacturing, education, finance and government. Additionally, 24 diverse workshops were offered, created based on feedback from previous year’s attendees. These practical workshops pointed a spotlight on a range of topics for manufacturing from financing and taxes to diversity and veterans.

Opening remarks were provided by Fresno City College President Carole Goldsmith, and San Joaquin Valley Manufacturing Alliance (SJVMA) Chair Mike Betts. Former President of Shell Oil Company and Founder of Citizens for Affordable Energy, John Hofmeister, provided the morning session keynote address, where he focused on energy related issues and its impact on manufacturing. The lunch keynote was delivered by Katherine A. DeRosear, the Partnership Architect for the Manufacturing Skills Institute (MSI), and facilitator of the Dream it. Do it. Virginia Network. DeRosear’s presentation centered on increasing the manufacturing capacity of communities by closing the career planning and skills gaps faced by advanced technology industries.

Planning for this year’s event was carried out by SJVMA committee members, led by Chair Mike Betts and Business Development Director, Sam Geil. Since rebranding itself in April 2016, SJVMA has reached a membership milestone of more than 500. Committee members and their hard work were recognized at a VIP reception held the night before the Summit at Mechanical Associates.

The Summit’s success shows what can be accomplished when people from different professions come together under one common vision: support a thriving economy where our Manufacturing industry can meet its full potential. SJVMA has many more projects to support this goal in the pipeline, and are already planning for next year’s Summit!