Bond approval a piece of financing puzzle for LaClare Farms dairy goat construction project

A proposed dairy goat facility in Fond du Lac County is one step closer to construction.

The $2.55 million industrial revenue bond issue for LaClare Farms of Chilton was approved by the Fond du Lac County board of supervisors at its Dec. 20 meeting.

The dairy goat facility will be located near Pipe in the northeast part of the county east of Lake Winnebago.

Receiving approval from the county board is "one piece of the financial puzzle," according to Larry Hedrich of the LaClare Farms family.

He noted that the decisions being made by several lenders lined up for financing the project are all contingent on those made by the other parties. He observed that the lending sector is quite different than it was a couple of years ago, but emphasized that approval of the industrial bond issue is a major piece of the overall financing package of about $4 million for the project.

Hedrich and his family were hoping that the financial arrangements would have been completed six months ago. That would have allowed them to begin construction before the start of winter on 13 acres of a larger parcel of farmland that was owned by Hedrich's grandparents and that is owned by several members of the extended family today.

What LaClare Farms intends to build is a complex that would include housing and milking facilities for hundreds of dairy goats, a creamery for making cheeses and other dairy products from goats' milk, and a retail store along with being set up to offer tours. The facility would be to the southeast of the corner of County HH and Highway 151 just north of Pipe and east of Lake Winnebago.

The family, whose daughter Katie won the United States Cheese Championship Contest earlier this year, is milking its goat herd of nearly 400 head on its home farm on the outskirts of Chilton and is having to make its several goat cheese varieties at two cooperating cheese plants.

With the second site, the Hedrichs envision milking from 600 up to as many as 750 goats total at the two sites, while raising the young goats at the home farm about 15 miles away.

On a 17-0 vote, the Fond du Lac County board approved issuance of the bonds that will be serviced by the Calumet County Bank of Brillion. This needs to be done before Jan. 1, 2013, according to the board's resolution.

The county board's funding authority for the bond stemmed from a federal funding program known as the "Midwest area disaster bond," which was approved to provide relief from flood damage in 2008 and for which Fond du Lac County had not expended all of its allocated funds, Hedrich explained.

According to the resolution, an upper limit of $3.5 million for the bond issue was indicated at a Sept. 20 public hearing on the potential issue of the bond to LaClare Farms. The resolution points out that Fond du Lac County does not incur any liability or indebtness as a result of this agreement and that interest paid on the bonds will be exempt from federal income tax.

The resolution also indicates that LaClare Farms LLC, the recipient of the industrial revenue bond issue, will be leasing the operation to a separate entity to be called LaClare Farms Specialists LLC, and that providing an estimate to the Wisconsin Department of Commerce of the number of jobs to be created at the new facility was also a condition for approving the bond issue.