Cheese baskets

It must have been a rough day of lobbying for the old man, because when I ran into him in the basement bar of the old Senator Hotel, across from the Capitol, he looked beat as he nursed a drink, thinking about driving back to Modesto in the tule fog and milking the cows the next morning.

If you stick around in one place long enough, what goes around comes around.

He’d probably, in his quiet way, had more to do with me being in that bar that winter afternoon in the late 1960s than anyone, so we sat together for awhile. There’s a dreamy quality to the conversation of dairymen at the end of the day, add a little whisky and it can get positively ruminative.

The old man was ruminating on a number of political issues pertaining to irrigation districts and milk prices. So, the whole conversation was basically metaphysical anyway.

After talking about pools and grades and river flows for awhile, however, he got concrete. I gathered the Legislature that year was “tighter than a bull’s ass at fly time,” on water and dairy issues.

He said he’d always been very grateful for the opportunity Modesto, CA had given him, a poor West Texas farmer, and he’d always tried to give back.

I was only one of a large number of young men from his town who had been the beneficiary of his generous attention. He’d load up his Buick with athletes from my high school and barrel off to visit athletic directors in colleges from Chico to Fresno every chance he got. There were a lot of guys that got to college because of the old man.

I remember in particular a fast linebacker on a championship team, who went no more than 145 pounds soaking wet. The cross-town rivals thought he was the hole through which they would march a huge fullback to victory one night; and that little linebacker gave the town a lesson in stone guts, throwing himself on those jackhammer knees play after play until they quit trying to destroy him. I caught up with him at halftime, face bruised, maybe a tear or two of pain, full of bitterness, fear and courage.

The old man found a place for me – a fast-talking kid on the college track -- easily. First it was the Key Club, junior Kiwanis, a lunch off school grounds once a month to listen to local civic leaders speak (impenetrable gobbledygook then as now). Later, after college, a slot in politics. But the linebacker was just a poor, tough kid from the wrong side of the tracks, not even a farmer. Nevertheless, the old man either saw or heard about that football game and what the linebacker did, and I can just hear him today, like it wasn’t 45 years ago, talking to football coaches about him: “More guts, pound-for-pound, than anyone on your team. He’s a good kid, he needs a scholarship, and you won’t go wrong on him.”

He always said – and was emphatic about it again that night in the Senator bar – that he was grateful and, despite momentary obstacles, he would go on trying to help.

That’s why it interested me that Hilmar Cheese, the largest single cheese factory in the world, a day after its water-pollution negotiations broke down with the regional water quality control board (1), announced it was opening a new cheese factory in the Texas Panhandle, near the site of the famous XIT cattle ranch. (2)

Texas Governor, Rick Perry, comes from a poor West Texas town himself, he apparently understands poverty and has tried to do something about it with enterprise funds, including paying Hilmar Cheese close to twice the amount the water board is asking in fines for the cheesemaker’s continual pollution of local groundwater. Hilmar Cheese is investing 47.5 times the amount of the $4-million fine in its Texas plant.

DALHART – Gov. Rick Perry today announced that Hilmar Cheese Company, the largest single-site cheese and whey products manufacturer in the world, will build a state of the art cheese factory in Dalhart, bringing nearly 2,000 jobs to the Texas Panhandle over the next decade.

“This expansion will bring 2,000 new jobs to the Panhandle and pump $190 million into the Texas economy thanks to a $7.5 million grant from the Texas Enterprise Fund,” said Perry. “As a rural West Texan, I am particularly proud that this amounts to the largest investment of Enterprise Fund dollars for a rural expansion.”

To secure the Hilmar investment over competing locations, the state offered the company a $7.5 million incentive package from the Texas Enterprise Fund (TEF) and additional funding for transportation improvements and workforce training. The state is expected to reap a return of more than 600 percent on its investment.

The company will make a capital investment of $190 million to build a new processing plant in Dalhart that will create new jobs for more than 350 area families. As part of its contract with the state, Hilmar Cheese Company has committed that new independent milk producers and new dairies across the region will create an additional 1,600 jobs over the next 10 years.

Once complete, the facility will have the capacity to process up to 5 million pounds of locally produced milk into high quality cheese and whey products each day, with the potential to double that capacity in the future …

As one of California’s largest agricultural exporters, Hilmar’s Dalhart plant will add to Texas’ reputation as the top exporting state in America. (3)

The old man was a builder, but he built community at least as much or more than he built industry. Community meant jobs, which meant industry, so it all worked together in his mind, but it came back to people. I don’t know if the 12 founding Jersey dairies behind Hilmar Cheese (4) were ever in it for anything but the money and the prestige of building the biggest cheese plant in the world. I’d like to believe that at least in the beginning they were in it for more than that.

Hilmar Cheese environmental commitment

Hilmar Cheese Company was California’s only processor to provide an incentive program to its producers who certified under the environmental stewardship component of the California Dairy Quality Assurance Program (CDQAP).

The old man might have said that was pretty slick, requiring (because the county requires it) the dairies to comply with the “environmental stewardship component.” He’d say it was pretty slick how Hilmar Cheese presents itself as a great environmental steward but has been out of compliance with the regulations that govern the plant for years. The sweetheart deal between the water board and the company came unglued because of some Sacramento Bee articles, the board levied the fine, one of the founders of the company had to quit his job as assistant secretary of the state Department of Food and Agriculture, company lawyers began threatening to sue the board and the company hired Bill Roberts’ old PR firm to run the propaganda (the old man would have known Roberts), and a day after the water board rejected Hilmar’s proposal, the company announced the Texas Panhandle deal.

The old man would say that’s a mess. But then he’d see what the Bee didn’t: more than 270 dairies, milking around 120,000 cows, that could lose their processor if Hilmar walks out of California. He’d look at the paper and see what Hilmar said about the Panhandle investment:

Hilmar also said it was influenced by the state's (Texas’) "positive business climate" and "reliable regulatory environment." (5)

I’m guessing he might have said he thought it looked like the Hilmar boys were about to cut and run, blaming California environmental regulation all the way to the Panhandle, and leave their dairies to fend for themselves in California, unless they want to make Dalhart their new home.

Five-day weather forecast for Dalhart:

Sunday: 39 degrees/5 degrees, snow
Monday: 45 degrees/16 degrees, partly cloudy
Tuesday: 27 degrees/10 degrees, partly cloudy
Wednesday: 20 degrees/8 degrees, snow.

Five-day weather forecast for Hilmar:

Sunday: 54 degrees/30 degrees, partly cloudy
Monday: 56 degrees/32 degrees, sunny
Tuesday: 57 degrees/41 degrees, partly cloudy
Wednesday: 59 degrees/42 degrees, partly cloudy

The old man was a builder. That generation generally believed that bigger was better. But, speaking from an ecological standpoint that would not have disgusted him, it seems to me that bigger has meant more concentration in fewer hands. When less than half a dozen cling peach processors pulled the plug in the mid-1960s, it was a very bad time for a whole lot of growers from San Joaquin to Fresno counties. When Gallo moved into Sonoma County, Sonoma grape growers learned about “Valley prices.” More corporate wineries from around the world made things even worse.

Recommended Pricing Considerations: For the past few years grapes prices have been suppressed to the extent that a significant number of growers have been unable to receive farming income sufficient to cover their farming costs. While this situation clearly is unsustainable for growers, it is equally unhealthy for the industry as a whole. To maintain the reputation that North Coast wines have achieved requires that high quality fruit be available from the vineyards. This cannot be accomplished without adhering to rigorous viticultural practices and control of crop sizes, both of which are labor intensive and expensive to sustain. Any degradation in vineyard integrity – a condition that would be forced upon growers if their compensation were insufficient to cover expenses - will ultimately lead to degradation in the quality of our wines – North Coast Grape Growers Association (6)

When Tri-Valley Coop announced bankruptcy a few years ago – after planting but before harvest – thousands of acres of processing tomatoes rotted in the fields.

Most devastating to growers was last year's bankruptcy of San-Ramon-based Tri Valley Growers. Farmers were left in a glut in July when the state's second-largest fruit and vegetable producer announced it would curtail its production due to lack of financing. Growers were left with thousands of acres of tomatoes rotting in the fields. (7)

The recent speculative real estate boom in the San Joaquin Valley has served to illuminate the underlying mother of all problems in Valley agriculture: the relation between the producer and the processor/packer – the seller and the buyer. We’ve had the infrastructure for generations: the land, the water, the financing, the workers and the skills behind the gigantic Valley agricultural output. But now the land, the water and the financing are becoming questionable under the impact of real estate development.

The only overarching concern between these two radically antagonistic industries is the environment, which returns us to the community, at least in terms of public health. But, apparently, Dalhart TX isn’t thinking in those terms.

The old man would be tickled by the High Plains Dairy Council blurb:

The High Plains Dairy Council was established in 2002 to promote the Dalhart area as a dairy relocation opportunity. The HPDC is made up of Dalhart area farmers and business'. Dalhart Texas is a unique community in that the vast majority of agricultural producers did not start their agricultural life in Dalhart. They have come here from all over the country. Dalhart is perhaps the most progressive agricultural area in America. Newcomers are instantly welcome. We are a community-minded group of people who truly enjoy and appreciate the quality of life that Dalhart has to offer. The land is good, the water is plentiful, the environment is friendly, the weather is pleasant and the people...we invite you to judge for yourself. If you are interested in relocating your dairy or business, we hope you will visit Dalhart before you make that important decision of where you and your family will make their home. We think you will be glad you did. Take some time and check out the stats page for more information on the Dalhart area and the vast number of opportunities it has to offer.


Where Opportunity and Success are a Way of Life

The old man would say that that was what he’d been saying about Modesto all those years.

Maybe all there is to the Hilmar Cheese story is that what goes around comes around, and it’s time for Valley farmers to go to Texas. From an ecological standpoint, however, it’s becoming fairly clear to people of ordinary intelligence that what goes around comes around for awhile, but eventually stops. From a community – rather than strictly a corporate – standpoint, it would be better if Hilmar paid the fine and figured out how to run a cheese plant that didn’t pollute groundwater. They could begin their new research on the funds they’d save by laying off lawyers and public relations firms to fight reasonable environmental regulations.

It seems doubtful that could happen, however. It seems like they’d rather leave California with their reputation of having built the largest cheese factory in the world intact. And it’s much easier to scare employees and dairymen with threats to leave, hire lawyers and flakmen to threaten and try to intimidate regulators and to try to buy politicians, than it is to figure out how to be the largest environmentally, socially and economically sustainable cheese factory in the world. It also seems like they are financially in over their heads in their meteoric rise in 20 years to being the largest cheese factory in the world. It seems like they now have to listen to investors, lawyers and propagandists more than to engineers, plant managers, dairymen and their own neighbors.

People ought to at least challenge them to live up to their own word.

Corporate Responsibility

Being a successful company goes well beyond onsite, daily operations. For Hilmar Cheese Company, it’s about giving back to the community and industry that supported a dream…the dream of our 12 founding dairy families who established the company in 1984. Our owners – most of whom are second and third generation members of the local Hilmar community – live and raise their families here.

At the forefront of Hilmar Cheese Company’s efforts are community and industry involvement and support. Our owners and management team give of themselves above and beyond their roles at Hilmar Cheese Company. They’re familiar faces and respected members of many dairy industry groups and civic organizations. Throughout the years, the company has donated thousands of dollars and countless cheese baskets to support local schools, charitable causes and the dairy industry.

As we look to future generations, Hilmar Cheese Company is deeply committed to protecting the environment and bettering the lives of our employees, their families and our neighbors by acting responsibly both onsite and in our surrounding community. (8)

This looks good, sounds good, and there is no reason for anyone to doubt that when it was written it was a sincere expression. But, aside from the Panhandle announcement, people might begin to feel that things have changed at Hilmar Cheese, for some reason, and that its word isn’t what it used to be. At least the water board might have felt so, when it voted unanimously last week to reject a proposed settlement of the fine.

Hilmar officials expressed optimism on resolving differences.

"We remain committed to working with the board and staff to address the few remaining questions that have been raised," John Jeter, Hilmar's president and chief executive officer, said in a prepared statement following the Sacramento hearing.

The board took issue with a term in the proposed settlement that would have used $1 million of the fine to fund a Hilmar-directed study to offer "possible solutions for management of salinity in food processing wastewater discharges."

Some board members said the study, which would have been conducted by two Hilmar-commissioned agricultural economists, appeared to be self-serving. It would have focused more on industry's desire to lower pollution control costs than on the public goal of protecting groundwater, said Christopher Cabaldon, a board member and mayor of West Sacramento.

"There's no consideration of water quality," Cabaldon said.

Bill Jennings, a water board watchdog, said the food-processing industry would have used such a study "as a hammer to bludgeon the board."

Jennings said, "It's like allowing a cigarette company to conduct a study on the health effects of smoking." (9)

“Cheese baskets,” the old might have said, getting up to drive down 99 in the fog. “Cheese baskets.” You would have had to hear it to know how he’d meant it.

Bill Hatch


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