DELTA JUNCTION (AP) -- Closing one of the two federally-inspected slaughterhouses on the Alaska mainland will hurt agriculture, but some of those most affected say the move is necessary because the plant does not operate efficiently or profitably as a state entity.
The Department of Corrections has operated the Mount McKinley Meat & Sausage slaughterhouse in Palmer since 1983. But last month, department officials decided not to renew its lease on the plant when it expires June 30.
It's not the first time the prisoner-run slaughterhouse has been on the chopping block.
Legislators are scrambling for $300,000 to tide the plant over for 12 to 18 months while the state looks for a buyer or private management. But while Delta Junction farmers are anxious for the plant to remain open, they say continued state ownership won't work.
Dairy farmers such as Pete Fellman, an aide to Rep. John Harris, R-Valdez, rely heavily on the slaughterhouse to take cows that are no longer productive breeders and milkers.
But, he says, ''as long as it's tied to the budget process, it makes a farmer skittish.''
The plant's closure could affect more than just dairy farmers and on livestock farmers such as Scott Miller.
''We have a very viable dairy industry in Alaska,'' Miller said. ''If they (dairy farmers) don't have any place to go with their cull cows, they can't survive.''
And if dairy farmers can't survive, there won't be a demand for the barley grown in Delta.
Producers say that because the plant has been on the budget block so often in the last few years, they have scaled back their operations.
As a result, Mount McKinley, designed to process 50 cattle and 100 hogs each day, hasn't the volume to make a decent profit. It bought about 900 beef animals and 700 hogs from 118 Alaska producers in 2001.
Last year the plant made about $6,000 on gross receipts of $1.4 million. So far this fiscal year, the plant is about $20,000 in the black.
Because it is a state business, Mount McKinley cannot compete directly with private industry.
''That has hampered their ability to develop the market the way they think they can,'' Fellman said.
Jeannie Pinkelman, who operates Delta Meat & Sausage with her family, is no happier than Miller or Fellman about the situation. She sees time running out for the plant.
''There's not going to be more mercy,'' said Pinkelman, whose family also raises livestock. Pinkelman said the state should consider granting low-interest loans and selling Mount McKinley equipment so that smaller operations can get started.
A state livestock cooperative similar to the arrangements for the Matanuska Maid dairy and Delta's Farmers Co-op is another solution, according to Fellman, the dairy farmer.
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