Archive: October 2024

More Restaurants Added To Popular Burger Trail

21 October 2024
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Burger fans traveling across Southeast Montana will now have more options to choose from, as the Southeast Montana Burger Trail announced it has added four new locations: On the Rocks in Worden, Stockman’s Club in Broadus, Six Gun Pizza in Forsyth and Mulligans Restaurant and Pub in Colstrip.

Since the inception of the Southeast Montana Burger Trail in 2022, more than 400 visitors from as far as Minnesota, Texas and Pennsylvania have downloaded the Southeast Montana Burger Trail Passport, which incentivizes travelers to venture off the highway to explore the area’s unique communities and delicious burgers.

Participants who visit four locations on the trail can earn an official sticker, and dedicated fans who visit eight locations are eligible to receive an official “Burger Boss” T-shirt.

 “Expanding our Burger Trail to include new locations within Southeast Montana is exciting and offers greater visibility to our rural communities that have numerous attractions beyond the highway,” said Sara Hollenbeck, content manager for Visit Southeast Montana. Details about each new stop on the Southeast Montana Burger Trail include:

* On the Rocks (2441 Main St., Worden): On the Rocks’ House Burger entices guests with its juicy patty, melted gruyere and house aioli, but it’s the irresistible bacon onion jam that steals the show. The burger creates a flavor explosion that makes the Worden exit off Interstate 90 not just a pit stop but a mouthwatering detour.

* Stockman’s Club (721 S. Park St., Broadus): The Stockman’s Club serves a legendary A-1 Burger featuring a juicy patty, choice of cheese, crispy bacon and caramelized onions, all crowned with a tangy, house-made A-1 sauce that makes it an unforgettable local favorite. 

* Six Gun Pizza (2100 Cedar St., Forsyth): With options to choose between a quarter-pound or half-pound beef patty sandwiched between homemade buns, guests are often found exclaiming “YUM” with every bite. Six Gun Pizza’s Smash Burger features pepper jack or American cheese, grilled onions and a signature secret sauce.

* Mulligans Restaurant and Pub (1 Long Drive Suite B, Colstrip): The Buzzy Burger at Mulligans Restaurant and Bar is the undisputed star of the menu. This mouthwatering masterpiece blends pork sausage, bacon and beef, which is all expertly seasoned for an explosion of flavor. Paired with fries dusted in Mulligans’ secret “pixie dust” seasoning, it’s a dining experience that is akin to a hole-in-one.

To see a full list of participating restaurants on the Southeast Montana Burger Trail and to download your passport, visit southeastmontana.com/burgertrail.

Four landmark properties are for sale in Livingston. They are Riverside Hardware and The Stockman Bar on Main Street, the 49er Diner, Bar and Casino on Park Street, and the former Livingston Enterprise building on South Main Street.

Montana Highlights October 15, 2024

21 October 2024
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As of June, Forever French, a baby and lifestyle brand owned by Chantelle French of Arizona, now has roots in Kalispell, offering the local community a boutique children’s and lifestyle store. Forever French began as an online business in 2019 after Chantelle French received her daughter’s autism diagnosis. Inspired by the beauty and resilience of her daughter, French began selling the store’s iconic soft, stretchy and breathable fabrics from her home in Arizona. Over time, the brand grew. In 2021, French opened her first physical store in Gilbert, Arizona. Then Arcadia, Arizona followed suit with a new storefront in July of 2023. Kalispell.

The Sidney-Richland Regional Airport will receive $3.1 million in funding to help repave and repair its runway. The funding, which totals $3,3134,500, will be used for a project involving milling the runways and resealing them. The construction will take place until next summer.

The City of Glasgow has decided to return part of the downtown parking to angle-in parking. Angle parking will be implemented on the south side of 2nd Ave. S., and the east side of 3rd St. S. The other side of the street will remain parallel parking. This project will increase available parking in downtown Glasgow by 20 to 30 percent. The project was awarded to LSC, Inc., in the amount of $27,850.80.

Plum Creek Timber Company opened a fiberboard plant in Columbia Falls in 1974. The plant cost Plum Creek, which was spun off from a division of Burlington Northern Railroad, $10.5 million and was expected to utilize 108,000 tons of wood waste annually. The initial plant was expected to produce about 70 million square feet of fiberboard a year and would employ about 115 workers.

Alliance for the Wild Rockies has announced its intent to sue the U.S. Forest Service over potential impacts to endangered species in the area of the Gold Butterfly Project located in the Sapphire Mountains. The Gold Butterfly project aims to harvest, thin, and prescribe burn forest stands to improve resilience to insects, disease, and wildfire and restore the fire return intervals.

The new Town Pump has opened recently on Huffine Lane outside of Bozeman. It is the largest of the businesses 200 plus locations in the state. The store offers the usual items besides fuel – beer cave, coffee, casino, sports bar and liquor store. 

Celebrated rodeo entertainer Flint Rasmussen will be among rodeo greats inducted into the National Rodeo Hall of Fame in November. The award tradition will continue as rodeo icons are recognized at the Rodeo Hall of Fame Weekend at The National Cowboy Museum on Nov. 8-9. Rasmussen grew up in Choteau, where he was an all-state football and track star in high school.

The one-year anniversary of one of the largest structure fires in downtown Glendive anticipates the pile of rubble that was once the Jordan Inn is set to be cleared. The cleanup of the property at the corner of Merrill Avenue and Benham Street will begin Sept. 30, funded by the U.S. Environmental Protection Agency. The cleanup effort will also include debris from the adjacent lot where the former Rose Theatre once stood.

The Wallace Works project is located at Wallace Avenue and Tamarack Street in Bozeman The developers got a boost recently when city commission planners voted to approve an urban renewal plan that will reimburse the developers for $2 million in taxes.

The U.S. Department of Transportation has approved the Essential Air Service proposal that provides  subsidies to SkyWest airlines to provide daily flights to and from Salt Lake City and Denver into Butte.

The United States Supreme Court will not hear an emergency appeal effort by power plant owners and utility companies that requested the high court to halt new pollution rules set out by the Biden administration and the Environmental Protection Agency.

The Miles City Parks Initiative is searching available options for a more sustainable way to maintain public spaces in and around Miles City. Funds for parks projects are often being redirected to fill in gaps in other general fund areas, such as police or fire.

Montana will raise the minimum wage by 2.53%. The minimum wage will be $10.55 starting January 1, 2025. In 2023, the industry with the largest number of workers earning minimum wage was the accommodations and food services industry.

Recently the Carbon County Planning Board approved a Development Permit for Croell, Inc., to establish a Concrete Batch Plant in Carbon County. the permit was approved with conditions by the Carbon County Planning Board acting as the County Zoning Board.

Montana State University officials have acknowledged that the university’s online learning platform, Desire2Learn (D2L), allows  the faculty to monitor student activity and potentially track their locations using their Internet Protocol (IP) addresses. IP addresses can be used to determine approximate user location such as city and zipcode.

Kalispell-based Mann Mortgage, operating as a family-owned business, has announced a deal to merge with a national lending company. The business will merge with Synergy One Lending of California.

Cousins Pub has the goal of being a welcoming door to walk through. Cous ins opened recently on  East Main Street in Bozeman.

A group of local, state and nonprofit entities is several years and millions of dollars into a project to clean up and redevelop the 180-acre railyard in Harlowton. The coalition plans to transform the land into a recreation area with trails, campgrounds and fishing access on the Musselshell River.

Rock Creek Resort, in Red Lodge is set to reopen next summer. The property, was sold in April to RCR Holdings, LLC., which includes David and Simona Krug of Krug Development and Daniel Cauley. Columbia Hospitality is acting as the hotel operator. Plans also include bringing the ballroom and the swimming pool closer to the creek experience by updating the windows in the ballroom and swimming pool and installing an outdoor hot tub.

The City of Miles City has adopted its budget for Fiscal Year 2025. The City is preparing for the impacts of significant cuts it had to make. When approved during a special meeting of the city council the budget for the next fiscal year included cutting three positions in the Miles City Police Department and three more in the Fire and Ambulance Department. Chief of Police Doug Columbik provided a statement in which he warned that demand for his department’s service are outpacing the city’s ability to provide them.

Chanelle Hayden has recently promoted to Operations Officer for Stockman Bank in Sidney. Her responsibilities include supervising all operations-related functions for Stockman Bank Sidney. Hayden has been with Stockman Bank since 2014, starting as a CSR and most recently serving as Teller Supervisor.

Misty Anderson has been promoted to Eastern Montana Cash Management Officer for Stockman Bank, Sidney. Her responsibilities include providing assistance to customers and continuing development of Stockman Bank’s eBiz/cash management online banking services.

The North Dakota Public Service Commission has approved a Certificate of Site Compatibility for Calgary, Alberta-based Cerilon Inc. to house its future gas-to-liquids (GTL) facility location southwest of Williston. The press release states the project will include two GTL facilities on the same site. Each facility will be capable of converting 240 million standard cubic feet per day of natural gas to 24,000 barrels per day of liquid hydrocarbon products. It will also generate electric power as a secondary benefit.

The excitement with which Big Sky has greeted a report about more flights out of Bozeman Yellowstone International Airport is an indication of why there is such an emphasize on improving connectivity for Bozeman – it’s called skiing.  The airport will offer flights to Washington, D.C. , on Saturdays, flights to Boston and New York Friday through Sunday and flights to Boise all week. The flights to Boise will increase connectivity between California and the southwest through Alaska Airlines. There will also be flights from Los Angeles, Boston, New York, Chicago, Seattle, Dallas, Denver and Washington, D.C., that land in Bozeman before noon.

Lockwood Pedestrian District To Build Sidewalk on OHR

21 October 2024
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Yellowstone County in coordination with the Lockwood Safety Pedestrian District plans to construct approximately 2,200 feet of sidewalk facilities along Old Hardin Road, in Lockwood, west of Johnson Lane. The project is in the early design phase with construction anticipated in 2025.

Proposed improvements are anticipated to include:

• A new, 6-foot boulevard sidewalk on the south side of Old Hardin Road between Woodland Road and the existing sidewalk near Lockwood Square, just east of Rykken Circle.

• Piping a section of the Lockwood Irrigation Ditch along Old Hardin Road.

• Minor drainage modifications to accommodate the new sidewalk.

• Americans with Disabilities Act (ADA) curb ramps.

The Lockwood Sidewalk project aims to improve pedestrian and ADA access along a heavily trafficked section of Old Hardin Road, providing more connectivity between existing sidewalks and future sidewalk improvements associated with the Montana Department of Transportation’s (MDT) Billings Bypass project.

 This Yellowstone County project is being funded by the Fixing America’s Surface Transportation (FAST) Act Surface Transportation Block Grant (STBG) program using Transportation Alternatives (TA) funding through the Montana Department of Transportation (MDT) as well as local matching funds.

Yellowstone County is overseeing project design and construction activities. DOWL is the engineering consultant.

Members of the public can email mmclean@dowl.com or call 406-869-6333 for more information and to sign up for project updates.

Immigrants Impact Housing Costs, But Immigrants Build Houses, Too

21 October 2024
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A Cato Institute scholar makes a point that is not being readily recognized in the issue of housing and the impact of immigrants. While immigrants do increase the demand for housing, immigrants also, disproportionally, comprise most construction workers who build new houses.

Alex Nowrasteh, vice president for economic and social policy studies at Cato, states that like all supply and demand issues, increased demand from immigrants will increase housing prices. He said, “Housing supply is relatively inelastic in many places, partly because of government policies like zoning and height restrictions and urban growth boundaries. Land use liberalization could make the housing supply more elastic, but the housing supply will not become perfectly elastic even if all land use laws are abolished. That means that higher demand, all things equal, will drive up prices and the quantity of housing.”

Nowrasteh advises, “The government should not seek to increase, reduce, or stabilize housing prices in the United States. It should merely respect property rights for land use and get out of the way to allow housing supply and housing demand to equilibrate to prices that change as the world does.”

Immigrants contribute to the increase in housing supply because 14.9 percent of noncitizens labor in the construction industry, according to the 2023 American Community Survey. Only 6.2 percent of native-born Americans work in construction. “Estimates show that about 30 percent of all construction workers are immigrants, with higher rates in California, Texas, Florida, New York, New Jersey, and Nevada. Deporting those workers or halting more immigrants will reduce the growth in the housing supply.”

However, immigrants increase housing demand more than they increase housing supply. “…immigrants who work in construction increase housing demand first before they can construct more housing. That increase in demand drives up prices and incentivizes new supply through further construction, renovation, or increasing the supply of rental units through other means,” says Nowrasteh.

Nowresteh further points out “most of the debate over the economics of immigration is focused on wages, which are barely affected by immigration. . . housing is the market where prices are most affected by immigration. . . the marginal immigrant affects housing prices by a factor of 3 to 10 more than wages.”

[Of foreign born workers in the US, 50.4 percent are non-citizens, according to the Economic Policy Institute. Their average salary is $35,989.]

Because native born Americans, most of whom are in the middle class, own two-thirds of the housing most of the increase in housing wealth caused by immigration accrues to native-born Americans.

Nationwide the median sale price of a single-family home increased 46 percent  from August 2019 to August 2024. In general, this has made renters and first-time home buyers worse off and homeowners, who are mostly native-born, better off. There are different ways to analyze the increase in housing prices, points out Nowresteh:  the price per square foot as a share of income is flat but houses are bigger than they used to be, and the real price per square foot is up nationwide.

For government to “get out of the way” would require state and local governments to eliminate zoning and land use policies and for the federal government to leave the mortgage business, among other changes.

Funds will Help Grow International Sales

21 October 2024
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The Montana Department of Commerce announced that $900,000 of federal grant funding is available to help small Montana businesses accelerate and grow international sales. The U.S. Small Business Administration funding is administered through Commerce’s State Trade Expansion Program.

“Commerce’s STEP grant makes world-wide markets more accessible to Montana’s small businesses,” said Paul Green, Director of the Montana Department of Commerce. “Since 2011, Commerce’s efforts through the STEP grant have produced a return on investment to Montana of $1.2 billion.”

The STEP grant will be used to support foreign trade missions, Montana pavilions at international trade shows and other international marketing projects. Since 2011, Montana has received $6.6 million in STEP grant funding from the SBA, matched it with $2.2 million in state funds, and awarded over 1,000 grants supporting 1,800 jobs.

Eligible Montana exporters can apply for 50 percent reimbursement of up to $10,000 for eligible marketing activities, like trade show exhibition, market research and U.S. commercial service programs and foreign language translation. Other eligible marketing activities include international compliance testing, intellectual property protection, digital marketing and travel stipends. Eligible applicants may receive up to $30,000 in STEP awards per year.

Eggart, Executive Director of Visit Billings

21 October 2024
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Aly Eggart, MSPR, CATP, recently accepted a promotion to Executive Director of Visit Billings, managed by the Billings Chamber of Commerce.

Eggart has been a member of the Visit Billings team since 2016 and most recently served as the Leisure Marketing Director. “We are excited for Aly to lead Visit Billings and the destination as its new executive director,” says Billings Chamber President and CEO John Brewer. “During her time with the organization, Aly has grown as a leader both internally and externally, positioning herself as a trusted advocate for Montana’s City. Her experience and passion for Billings will serve her well as she implements the new strategic plan for Visit Billings and continues to move the destination forward.”

As the Executive Director, she is responsible for fostering Visit Billings’ mission of generating room nights for lodging facilities in the city of Billings by effectively marketing the region as a preferred travel destination. She will oversee the Tourism Business Improvement District (TBID) board and a staff of four people, execute the lodging tax contract and a $4 million tourism budget, along with growing the sports tourism segment. Visit Billings promotes the city and the region through sales and marketing to meeting and sporting event planners, tour operators, travel industry professionals, journalists, and leisure visitors

Construction Begins on Short-term Jail

21 October 2024
Evelyn Pyburn
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Last week construction began on the new short -term holding facility next to the Yellowstone County Detention Facility (YCDF). The $6 million project is a collaborative solution by Yellowstone County and the City of Billings to address overcrowding at YCDF. It will provide a means of jailing offenders while they wait for arraignment. The two-story facility will house inmates for 72 hours – inmates who in the past have not been incarcerated because there was no room in the jail. The facility designed by Schutz Foss Architects Foss is being built by Sletten Construction and is expected to be completed in 13- 15 months. County Commissioner Mark Morris said that the contractors wanted to begin construction as soon as possible in order to have concrete poured and walls up before it snows.

The operation of the short term facility depends upon the establishment of an arraignment court which is currently in process. Justice of the Peace David Carter is in the process of training the two full time employees who are needed to manage the arraignment court.

Management of the holding facility will fall to YCDF. That it will require a couple more full time staff is sort of a moot point, according to Morse, because they are always trying to hire personnel  and are generally 13-14 short of being fully staffed.

Billings Building Permits October 15, 2024

21 October 2024
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Commercial

Yellowstone County|Sletten Construction Companies, 3165 King Ave E, Com Addition, $800,000

Billings Logistics Center One|Bauer Construction, 3218 S Frontage Rd, Com Remodel, $320,000

Ethan Kanning, 425 Henry Chapple St, Com Footing/Foundation, $60,000

Keller Billings LLC |Patriot Construction LLC, 1 1st Ave S, Com New Warehouse/Storage,  $56,000

St Johns Foundation |Ben Mitchell Construction LLC, 3940 Rimrock Rd, Com Remodel, $55,000

Miller Richard A|Yellow Ball Roofing & Solar LLC, 713 Main St,  Com Fence/Roof/Siding, $35,653

Bresnan Communications LLC|AC Schommer & Sons Inc, 1860 Monad Rd, Com Remodel, $18000

Gracepoint Church Of Billings|KE Construction LLC, 1605 Inverness Dr, Com New Church, $3,500,000

Less Tropican Inn-Vestments 2.0 LLC|Environmental Contractors LLC, 5500 Midland Rd, Demolition, Commercial $182,000

Billings 401 LLC|Automatic Doors Of Montana Inc, 401 N 31st St., Com Remodel, $200,000

Hanser Properties LP|Hanser’s Properties, 529 S Billings Blvd, Demolition Commercial, $5,000

Grand Center LLC|Stronghand Construction LLC, 1212 Grand Ave, Commercial Remodel, $75,000

Rocky Vista University LLC|Langlas & Assoc. Inc., 4130 Rocky Vista Way, Commercial New Other,$9,000,000

Ethan Kanning |Bauer Construction, 425 Henry Chapple St, Com New Restaurant/Casino/Bar, $1,370,000.00

Brad Barker |Old Soldier Equipment Company LLC, 208 N 29th St, Hedden Empire Building 2nd Flo0r Remodel, Com Remodel, $500,000

Shawn Nelson |Langlas & Assoc. Inc., 209 N 29th St, Com Remodel, $247,000

Mike Evans |TW Ridley LLC, 1045 Grand Ave, Com Remodel, $241,200

Charter Communications Inc|A Schommer & Sons Inc, 1860 Monad Rd, Com Fence/Roof/Siding, $130,000

Chilton Wayne A & Celia D|The Mr. Fix-It Network, 1818 Main St, Com Fence/Roof/Siding, $60,000

St. Johns Lutheran Ministries |Ben Mitchell Construction LLC, 3940 Rimrock Rd, Com Remodel, $50,000

Love Properties Llp|Shelving Concepts Inc, 1224 Cordova St, Com Remodel, $36,654

Nelson Investments LLC &|Lennick Bros., 2121 1st Ave S, Com Fence/Roof/Siding, $24,000

Residential

Linde Steven R Trustee &|Image Builders, 2393 Larchwood Ln, Residence Res New Single Family, $1,400,000

South Pine Design |South Pine Design, 5317 S Iron Mountain Rd, Res New Single Family, $600,000

Greg & Lynn Waters |Image Builders, 2505 Buffalo Ridge, Res New Single Family, $407,145

Diverse Construction |Diverse Construction LLC, 2043 Cypress Pt, Res New Single Family, $380,856

Billings Best Builders LLC|Billings Best Builders LLC, 5389 Iron Mountain Rd, Res New Single Family, $325,000

High Sierra Ii Inc|JKC Inc, 969 Matador Ave, Res New Single Family, $242,903

Mccall |Mccall Development, 1829 St Peter Ln, Res New Single Family, $135,109

Mccall |Mccall Development 1825 St Peter Ln, Res New Single Family, $131,659

Mccall |Mccall Development, 1833 St Peter Ln, Res New Single Family, $131,559

Mccall Homes |Mccall Development, 1825 St George Blvd, Res New Accessory Structure, $63,360

Klier, Jeffrey A & Angela T, 2046 Avenue D, Res New Accessory Structure,$ 32,256

Asher Julie K & John E|Image Builders, 1815 Georgia Pine Ln, Res New Single Family, $1,500,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1802 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1804 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1812 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1814 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1822 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1824 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1902 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development Ll1904 Charlotte Dr ,  New Townhome $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1912 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1914 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1922 Charlotte Dr, Res New Townhome, $900,000

Wl Zimmerman LLC|Lees Construction & Development LLC, 1924 Charlotte Dr, Res New Townhome, $900,000

Mike Christensen |Michael Christensen Homes, 1241 Olive Ln, Res New Single Family, $450,000

Infinity Home LLC |Infinity Home LLC, 2151 Lakehills Dr, Res New Single Family, $351,421

Infinity Home LLC |Infinity Home LLC, 578 Chino Cir, Res New Single Family, $242,671

McCall Homes |McCall Development, 1830 Norma Jean Sq W, Res New Single Family, $159,607

CDH LLC |CDH LLC, 5232 Rich Ln, Res New Single Family, $339,681

Infinity Home LLC |Infinity Home LLC, 2220 Lindero Blvd, Res New Single Family, $176,872

Infinity Home LLC |Infinity Home LLC, 2214 Lindero Blvd, Res New Single Family, $175,720

Lakeview Loan Servicing LLC|Castellano Enterprises Inc, 3294 Windmill Cir, Res Remodel Single/Duplex/Garage, $80,000

Tonn Bruce, 2907 Montana Ave, Res Remodel Single/Duplex/Garage, $65,000

501 S 35th Mt LLC/ Bobs Home Interior And Exterior, 501 S 35th St,  Res Remodel Single/Duplex/Garage, $30,000

Arveschoug, BSED Director to Retire

21 October 2024
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After 16 and a half years of dedicated service, Steve Arveschoug, Executive Director of Big Sky Economic Development (BSED) has announced his retirement, effective April 2025. Steve has served as the BSED Executive Director since 2008, leading the organization in its mission to strengthen and grow Yellowstone County’s economy and quality of life.

In preparation for this leadership transition, Steve has worked closely with the BSED Board of Directors to roll out an organizational succession plan. The Board approved the leadership transition plan at last week’s board meeting. They have formed a search committee and hired Jorgenson Pace, a national executive search firm, to lead the search for a new Executive Director of Big Sky Economic Development. The search process will begin with key stakeholder dialogues involving the BSED team, key civic and business leaders, and community partners.

“It has been an honor to work with Steve for many years to serve this community.  While it will be bittersweet for us who will miss his leadership, we are optimistic as a board as we look to transition smoothly into our next phase and continue to build and expand on the work that has been done,” said BSED Economic Development Corporation Board Chair, Andrew Gott, First Interstate Bank.

BSED’s Economic Development Authority Board Chair, Riley Bennett, Dick Anderson Construction said, “All organizations undergo changes in leadership from time to time. Big Sky Economic Development has been very fortunate to have Steve Arveschoug’s vision and guidance for the past 16 years. He and his leadership will be greatly missed. Steve has planned diligently for his succession and prepared the organization for this inevitable transition. The Big Sky EDA/EDC board is dedicated to recruiting and hiring the next Executive Director for Big Sky Economic Development. We are confident that the organization and its team will look to the future and not only manage this change but strengthen the organization and its mission through this new leadership opportunity.” 

“I look forward to supporting a great leadership transition for Big Sky Economic Development. We have an outstanding team in place and a strong board. The future is bright for BSED and its role as the community’s economic development organization. It has been my honor to be a part of this team and mission. I am indeed blessed by this experience.” – Steve Arveschoug, Executive Director, Big Sky Economic Development.

Agriculture Faces a Continued Decline in 2024

21 October 2024
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Joe Mahon, Director, Regional Outreach Federal Reserve Bank of Minneapolis

After turning south in 2023, agricultural producers in the Ninth District saw their earnings decline further through the middle of 2024, according to results from the Federal Reserve Bank of Minneapolis’ second-quarter agricultural credit conditions survey.

Farm incomes decreased broadly from April through June relative to a year earlier, according to the survey, which was conducted during July. Spending on capital equipment also dropped, while farm household purchases increased.

Even as interest rates ticked up, falling incomes boosted loan demand, while the rate of loan repayment dipped slightly, and renewal and extension activity rose. Farmland values rose further, while cash rents also increased. Survey respondents predicted the third quarter will bring further declines in income, though they expect overall financial conditions to hold up better.

“Continued high input costs with lower commodity prices will result in decreased liquidity in many operations,” said a Minnesota banker. Many of their peers agreed, as 85 percent of lenders reported that borrower liquidity had decreased in the past three months from the same period a year earlier.

Farm incomes and spending also decreased due to weaker crop prices. More than 75 percent of district lenders surveyed reported that farm incomes decreased in the second quarter of 2024 from the same period in 2023, compared with only 11 percent who reported increased incomes. Nearly half reported that capital spending decreased. In contrast, spending by farm households increased on balance, as 40 percent of survey respondents saw an increase compared with 15 percent who reported decreases.

Owing to a prolonged decline in incomes and elevated operating costs, demand for credit increased in the second quarter, according to lenders. Nearly half of respondents indicated that loan demand increased relative to a year earlier, compared with 1 in 5 who reported lower demand. Collateral requirements were unchanged according to a strong majority of lenders surveyed—87 percent—though the remainder reported that they increased. Average fixed and variable rates on operating, machinery, and real estate loans all increased slightly in the second quarter.

“We have completed our renewal season and for the most part our customers had a good year,” commented a South Dakota lender. Loan renewals generally increased across the district, while the rate of repayment on agricultural loans decreased on balance, reflecting overall stability in farm finances. Nearly a third of lenders stated that the number of renewals increased from a year ago, with almost all of the remainder reporting that renewal activity was unchanged. About 1 in 5 respondents reported that the rate of loan repayment fell from a year earlier, while only 5 percent said that repayment rates increased. None of the bankers responding to the survey reported having refused a loan due to a shortage of funds.

Continuing a four-year trend, land values and cash rents grew further in the second quarter. Ninth District nonirrigated cropland values increased by 3 percent on average from the second quarter of 2023. Irrigated cropland values rose by more than 13 percent from a year earlier, while ranch- and pastureland values increased to just under 13 percent. The district average cash rent for nonirrigated land jumped by less than 1 percent from a year ago. Ranchland rents increased by 11 percent, while cash rents for irrigated land fell by almost 3 percent. Changes in land values and rents were somewhat mixed across district states, with the highest rates of increase in Wisconsin and North Dakota, while values fell in South Dakota.

A comment from a Minnesota lender captured the pessimistic sentiment for the sector: “With declining grain prices and a poor crop in the field 2024 is shaping up to be a below average year!”

Over the next few months, survey respondents said they expect further downward momentum in incomes. Across the district, 78 percent of lenders expect that farm income will decline in the third quarter of 2024, compared with 7 percent who forecast increases. The outlook for capital spending was also negative, while expectations for household spending were flat. Lenders predicted that loan demand will grow on balance in the upcoming quarter, with half of respondents expecting increases and 13 percent predicting decreased demand. The outlook for loan repayment was generally stable overall, as 71 percent of respondents reported they expect no change in repayment rates; however 22 percent forecast repayment rates to decrease. Almost all respondents were not planning any change in collateral requirements for borrowers.