Business Spotlight on North Valley Ag Services

Presented to Chico City Council on October 6, 2015

Good evening. I’m Toni Scott with Morrison & Company, and Chair Elect of the Board of Directors for the Chico Chamber of Commerce.

Tonight, we are pleased to spotlight North Valley Ag Services, a nearly 60-year old business, cooperatively owned by local farmers who are both members and patrons.

Joining us tonight is Taylor Denney, Sales Manager for North Valley Ag Services, who will be happy to answer your questions following this presentation. Also with us is Vicki Doll from Chabin Concepts who will deliver our economic impact analysis, and Katie Simmons with the Chico Chamber who coordinated the presentation. North Valley Ag Services was founded in 1957 as Chico Bean Growers by 15 bean farmers, who were looking to work together to process and market their dried, colored beans. As a cooperative, the business model these farmers sought is unique from traditional business structures that most may be familiar with, but not uncommon in the agriculture industry. Cooperatives are owned by growers and serve their grower-members, and in the case of Chico Bean Growers, allowed the founding farmers to collaboratively pool resources to better their position in the marketplace. In 1979, a peak year for the company, Chico Bean Growers processed, stored, and marketed 22 million pounds of beans.

Yet, over time, the needs of the Chico Bean Grower- members changed, particularly as farmers in the area shifted from growing beans, to walnuts, almonds, and other permanent crops. Today, just 2 million pounds are delivered by local farmers to Chico Bean Growers, a number that represents 10% of the peak production once experienced locally.

Like any business responsive to its customers and its owners – Chico Bean Growers recognized the need to change with its growers. As President Mark Pierce succinctly summarizes, “The fundamentalism of farming is change.”

As such, about 25 years ago, Chico Bean Growers evolved to North Valley Ag Services, transitioning to a farm supply company that serves farmers from Woodland to Redding. Based here in the Chico, on Bell Road, the main focus of the co-op now is to store and distribute soil amendments and crop protection materials to area growers, which help keep soils fertile, healthy, and producing crops that help make California the number one agriculture state in the nation, significantly impacting our economic health.

North Valley Ag Services handles over 300 railcars of soil amendments per year and stores materials for major suppliers. They follow the strictest safety protocols, and are continually focused on educating their employees and their farmer customers on the proper use and handling of these materials. Farmers, like any business owner, are keenly aware of their bottom line, and recognize that spending more than they need to on any inputs, could negatively impact profits. North Valley Ag Services works with its member-owners to ensure that farmers are taking the steps to keep their orchards and fields healthy, and businesses profitable.

In addition, among other services like bean cleaning, and crop protection services, the company provides soil and tissue sampling services – important particularly in a drought year to ensure healthy trees, soil, and quality crops.

The dynamic nature of the business has been one catalyst that has led their longevity in the Chico business community. In 2001, the organization suffered a loss, and saw $3.5 million in sales. In 2015, North Valley Ag Services is poised to hit $55 million in sales, with a growth expectation of 6-7% per year. This allows the Chico business to continue to retain and expand its employment, and continue to meaningfully contribute to the number on industry in the county. Butte County’s agriculture industry is valued at a gross crop revenue of $810 million. One those almonds have chocolate on them, or our rice is made into tasty rice chips, that value can double to quadruple, based on UC Davis estimates.

Despite this growth and success, however, there are challenges that face North Valley Ag Services and its grower members. According to the most recent data from the U.S. Department of Agriculture's Census of Agriculture, over the last 30 years, the average age of U.S. farmers has grown by nearly eight years, from 50.5 years to 58.3 years. Unfortunately, the data also shows that there aren’t enough aspiring farmers coming behind this aging generation, with the potential for a huge loss of family-owned farms. There is a tremendous need for succession planning in the agriculture industry, with other issues such as the Estate Tax, having the potential to harm the transfer of family farms to the next generation. And with 98% of all farms in the United States family-owned, this is a significant battle to overcome to preserve these vital businesses.

As they look to the future as a growing business in this city, North Valley Ag Services is particularly attune to the need for a strong focus on public safety. President Mark Pierce counts public safety as one of the most important factors impacting their business. With their own railyard and sensitive materials on site, North Valley Ag Services has a strong relationship with local public safety agencies, including the Chico Fire Department, and notes the need for public safety in keeping their business healthy.

With that, I am going to turn the presentation over to Vicki Doll with Chabin Concepts to review the economic impact slide. Following Vicki’s presentation, Taylor is here to answer any questions you might have.

I go to a lot of meetings. More than I can count. And the one thing each meeting has in common, no matter the topic, is change - either rolling with it, forcing it, or recovering from it. Nothing is static anymore. Our working lives are as varied as the thoughts that run through our minds - at least that's the case when the work is advocacy, as is mine. No two days or even hours are the same which is why long-term projects, like our Community Vision, are necessary to tether us to our ultimate goals.

Change at the Chamber is inseparable from change within our business community. We exist to be the voice of business, period, and when that voice needs to be louder or needs to change tone or tack, we adjust our sails accordingly and immediately. While incremental changes have served our organization over time, the feedback we're getting from our members, our Board, and millennials in Chico is that we need to speed up our own evolution to ensure we're not only relevant next year but tomorrow. It's critical to the health of our economy and the safety of our community that we stay on point as the voice of business every single day. Our vision for Chico relies on it.

To that end, we're dedicating the entire month of October to gathering your input on our Community Vision and on the Chamber itself. Because so much of our work is unseen (remember those meetings I mentioned?), we need your help in making sure we are perfectly aligned with our members and business community.

It's simple: our sole purpose is to lift the economic tide to lift all ships - it's the reason we were founded over a century ago - so we're getting back to basics as an organization and want to make sure we're all in this together. Please take a moment to answer our survey and attend our "Moving Chico Forward" discussion on October 22nd. It's more important than ever before that we speak with one voice.

Moving Chico Forward By Addressing Public Safety Needs

Good evening, City council members. I’m Katie Simmons, President & CEO of the Chico Chamber of Commerce.

As Mark Francis, President & CEO of Golden Valley Bank, and Chairman of the Chamber Board of Directors, likes to say: everything we see is a result of a successful business, from the clothes on our backs, to the food on our tables, to the jobs that allow for the purchase of homes. Businesses make all of these things possible for our community.

It is also true that Chico is built upon a foundation of compassion and is a deeply generous community, led in no small part by the businesses that give to our shelters, services, churches, and community-based organizations with missions dedicated to improving lives. The level of giving and compassion that runs powerfully and quietly through our community is at risk.  It is at risk because of a feeling of lawlessness that pervades perceptions and experiences in Chico.

Without adequate accountability and enforcement to maintain civility, and standards and expectations upheld for all citizens, there is a growing sense of decline in our community and a noticeable erosion of confidence in our downtown and other business districts, neighborhoods, and green spaces. And with these increasing frustrations and a sense of being unheard, come acts of vigilantism and extremism that put everyone at risk.

Community members are reaching and surpassing personal limits every day, and we are sitting on the precipice of watching the generous culture and character of Chico change irrevocably. This ordinance will not solve everything, nor does it complete the spectrum of needs we have in this community, but it sets a tone to our businesses and to our community at large that the crimes and bad behaviors we have witnessed, been victims of, or heard about are not OK in Chico.

We must continue to fill the gaps in our enforcement tool box with ordinances like this, as well as create much-needed bridges into services through partnerships that the Chamber actively participates in. One will not be successful without the other in meeting the needs of all citizens in Chico, and the business community has been part of the solution all along.

Last night, Chico joined a growing list of California cities approving the formation of a Tourism Business Improvement District (TBID). This small assessment on lodging stays will generate funds for dedicated destination marketing of Chico and, if other neighboring communities join in, all of Butte County. Whereas Transient Occupancy Tax was once used for this purpose, the TBID will provide a sustainable funding source over time to attract visitors for overnight stays, increasing the patronage of our hotels, restaurants, retail businesses, and more. We're pleased that the City Council voted in favor of this proven strategy for tourism development.

You may have heard about the "Safety Meetings" we're hosting around town with Team Chico and the Chico Police Department.  Building off of our business walks and the Nord Corridor & South Campus safety meetings we hosted in June and July, we're bringing these opportunities to other business districts in Chico to improve communications and connectivity with law enforcement. These meetings are free and open to business and property owners in each area, as well as to residents who have an interest in participating.

Upcoming meetings:

• Mangrove and Vallombrosa Avenues & Bidwell Park: Monday, September 21st, 11 a.m. - 12 p.m. in the CARD Community Room, 545 Vallombrosa Avenue. 
• Nord Corridor & South Campus Area: Wednesday, September 23rd, 7:30 - 8:30 p.m., Azad's Martial Arts Family Center, 313 Walnut Street, Chico.
• Park Avenue Corridor & Surrounding Areas: Thursday, October 22nd, 3:30 - 4:30 p.m. at Chico Country Day Middle School Common Area, 1054 Broadway.
• Downtown Chico: Tuesday, November 17th, 9 - 10 a.m. in the Old Municipal Building conference room, 441 Main Street. 
• Safety meetings are planned for the Rio Lindo Area and Chico Airport in the immediate future. Additional meetings will be hosted throughout business districts in Chico in 2016.

If you wish to host a meeting at your business, please let me know!

In other news, we're dedicating the entire month of October to generating member awareness and feedback!  We'll be releasing a month-long survey asking for your input on what the Chamber of the future looks like. With the roll out of our Community Vision last month, it's time to build our Chamber Vision together. Stay tuned!

Last but not least, here's a sneak peek at the early results of our Millennial Survey. More to come!

At our recent Lunch Hour with the Mayor, Mark Sorensen met with our members to talk about the state of the City. After approving a $109.7 million dollar budget for the 2015-2016 fiscal year, the Mayor says the City is bouncing back far more quickly than anticipated, but the initial 10-year projected recovery time is still accurate when we consider building back reserves and having the flexibility to proactively invest in our community.
 

New Police Chief Michael O'Brien, who attended our June Board meeting, says his department will refocus on addressing top complaints in the community which center around "quality of life" crimes that erode residential and business confidence. His department, he says, is on the rebound after officer numbers bottomed out earlier this year. Things, it seems, are finally looking up for the City after a long and arduous journey from near insolvency a few years ago, but the City still has work to do, as the Mayor cautions. Businesses, on the other hand, are thriving like those we visited on our Team Chico Business Walks on June 24th, see below. 

One business reported hitting record sales numbers month after month which has led to more jobs and possible expansion plans. You've heard us say that everything you see is a result of a successful business, and this is precisely why.

If you were born between 1980 and the early 2000s please take our 3-minuteMillennial Survey, or forward it to the millennials in your life!  The results of this survey will offer us a rare sneak peek into the future of our community.  Thank you for helping us reach our goal of 500 responses!

Millennials - who are they and what do they want? I'm kidding, but much of the talk around our office over the last few months has been centered around these two questions. As you likely know, millennials were born between 1980 and the early 2000s, and they are shaking things up in the business world and in our workplaces. Even the White House published a study called 15 Economic Facts About Millennials in 2014. And you know how it goes: once you pay attention to something, it starts popping up everywhere...as has been the case with our focus on Millennials. Later this month, to help us understand how to do business with and for these technological trailblazers - called "technology natives" by many major corporations - our Chico Young Professionals Organization will be circulating a Millennial Survey to begin scoping out this information in Chico. With a goal of 500 responses, the survey will be open to the public and we're hoping you will encourage all millennials in your local circle to take it. With this information, we will not only better understand what the "Voice of Millennials" in Chico sounds like, but we will be better equipped to consider their expectations as we finalize the community vision plan Mark refers to in his message below.

Last Friday, I said goodbye to our Air Service Development Manager after coordinating 3 days of meetings for him with local businesses and entities. His intent on this first trip was to gather information on what kind of airline service Chico might be able to sustain. I don't have any details to share just yet as his meetings with the airlines begin this month, but as soon as I know what direction we're heading, I'll let you know!

With that, I'll see you on the 11th at Patrick Ranch for the anniversary celebration of the year. We love Italian Cottage!

This week, AvPORTS, the company hired to develop a long-term business plan for the Chico Municipal Airport made their first public visit to Chico. Back in March, it was our recommendation to the City Council that an Airport Manager or firm be hired if restoring commercial air service is a community priority - which, in so many ways, it is. But, there is more to AvPORTS' work than attracting an air carrier to our city. To dive into the details about business development plans, infrastructure improvements, and, yes, what commercial carriers are saying about Chico, we had the opportunity to participate in a stakeholders meeting with their CEO. We spent some time talking about what makes the Chico air field unique and the benefits of such a diversified business mix currently located at the airport. The good news is: AvPORTS sees a great deal of potential for the Chico Municipal Airport. The work lies in maintaining a general willingness to tolerate and adapt to new standards, developing adequate incentives for the airline attraction strategy, and ultimately centralizing our marketing efforts to brand Chico as a regional travel hub. This is just the beginning of the City's formal relationship with AvPORTS but I, for one, am very invested in ensuring the business voice is heard in each and every discussion.

Speaking of travel, Chico will soon host tens of thousands of parents and visitors who will be dining, shopping, lodging, and recreating in our fair city. Graduation weekend is great for business! Enjoy the smiling faces of the many proud family members and friends who helped Chico State and Butte College turn students into graduates. It's a great month to celebrate their accomplishments and to give their guests a red-carpet experience that they'll never forget.