Sweet Water “Organics” fails to create jobs, must repay loan from City of Milwaukee (EDITED)

Ed. Note: Edited to reflect the fact that the folks at SWO want the job creation conditions contained in their original loan with the City of Milwaukee removed before the loan is transferred to the non-profit Sweet Water Foundation.

Why am I not shocked by this?

Sweet Water Organics fell far short of its job creation goal for 2012, triggering a requirement that it repay around $63,000 of a city loan by March 1.

Sweet Water isn’t likely to meet that deadline, and is seeking changes in the loan terms, Milwaukee aldermen were told Monday.

If the company, which raises fish and vegetables, misses the deadline, the entire $144,199 balance is due by March 11, according to a report to the Common Council’s Community and Economic Development Committee.

Sweet Water has spent around $207,000, mainly on new hoop houses and fish production equipment.

According to the terms of its loan agreement with the City of Milwaukee, Sweet Water “Organics” needed to have 21 full-time workers by the end of 2012 in order to have its loan payment for that year waived. As reported by Tom Daykin of the Milwaukee Journal Sentinel, Sweet Water had just 2.35 jobs.

Not surprisingly, the folks at Sweet Water “Organics” now want the Milwaukee Common Council to change the loan’s terms to include a provision the nonprofit Sweet Water Foundation to take over the loan and the task of creating more jobs while the job creation requirements would be removed from the loan. Members of the Common Council’s Community and Economic Development Committee have asked Sweet Water to create a specific proposal on how the nonprofit Sweet Water Foundation would create jobs. I find it incredibly hard to believe that the nonprofit Sweet Water Foundation would be any more successful in creating jobs than the for-profit arm of Sweet Water was.

To read more on the myriad of problems that have plagued Sweet Water “Organics,” click here.

11 comments to Sweet Water “Organics” fails to create jobs, must repay loan from City of Milwaukee (EDITED)

  • John Casper

    Because of this, “Across Corn Belt, Farmland Prices Keep Soaring”
    http://www.nytimes.com/2012/10/23/us/across-corn-belt-farmland-prices-keep-soaring.html?pagewanted=all
    I had no problem with Milwaukee’s strategy. The future is with urban/indoor/vertical farming. The execution, however, was off. AFAIK, the principles were roofers without any experience in farming. Even for people with a lot of experience, in fish farming, aquaponics, and hydroponics, it’s not easy to turn a profit. Massive subsidies to industrial farmers make the competition really tough.

    IMHO, lawn service crews will eventually evolve into urban agriculture teams. They’ll maintain a whole bunch of small green houses ( some built on grass they used to cut). Some of those may contain a small aquaponics operation. That distributes risk. If you have problems at one, the crew learns from it. but their whole “crop” isn’t destroyed. You get a couple thousand of those up and running in Milwaukee and you have a de-centralized LOCAL source of perch/tilapia. My guess is that one of the many marketing challenges Sweet Water faced is that their whole crop of perch was hitting the market at the same time. Another issue is fish food. If you get a bunch of those small aquaponics operations, they will want LOCAL organic fish food from someone they trust. Quality control is critical. Another piece of the puzzle is the energy to circulate the water. They’ll likely want that from a green, local, source.

    One of the ideas to fund stuff like this is a “Fee and Dividend” tax on green house gasses with a 100% dividend.

    http://www.climatelobby.com/fee-and-dividend/

    That means 100% of the revenue goes right back into the pockets of the taxpayers. Gas prices would rise, but it would power in the hands of the consumers to pick de-centralized technologies they want.

    From the AP: “Wisconsin’s apple production sees huge drop-off, report says”‏

    “Apple production in Wisconsin has dropped to its lowest level since 1945. The National Agricultural Statistics Service says apple production in 2012 was down 54% in Wisconsin. Yields decreased more than three tons per acre. A heat wave last spring caused apple trees to bloom prematurely. And then frost in April killed many of the blossoms. A summer drought only made things worse…..”

    http://www.jsonline.com/news/wisconsin/wisconsins-apple-production-sees-huge-dropoff-report-says-m18r7ba-191815711.html

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  • Cat Kin

    Conservative marketing forces will kill any progressive enterprise if they can. So well meaning enterprises must apply extra effort and, most important, that annoying attribute, professionalism.

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  • The future as urban/indoor/vertical farming is bunk. It is too energy intensive to make any economic sense, even with green energy. It’s a feel good gesture. For somethings like fish aquaculture it might eventually make sense when we finally violate our last sources of clean water.

    The future of agriculture is rational and reasonable land managment to preserve existing farm land. The most egregious actions against the land and our food sources has been the unchecked and unplanned growth across the most productive farmlands in SE Wisconsin for cities like Brookfield, Pewaukee, Oak Creek, Mequon, New Berlin, Greenfield, etc. The rape of the Pabst Farms in Cooney for instance is just the most recent sin against nature.

    And of course subsidies for corporate farming have to stop.

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    • John Casper

      Ed, agree about urban sprawl and the need to maintain current farm lands. I hope you’re right about urban agriculture/indoor/vertical farming being bunk. That would mean our food supply stayed intact. Once you stop the subsidies for corporate farming, a worthy goal, afaik, the 99% can only afford to eat what’s grown within 50 or 100 miles of them. The price of food will shoot up and it will no longer be affordable to truck it in frozen from thousands of miles away.

      While more energy intensive, indoor and vertical farming can “crop” 12 months a year. Another big advantage is that Indoor farming is less susceptible to pests and disease.

      Video-conferencing technologies mean that local “farmers” can stream real-time video of stuff they cannot figure out, spots on a plant, a bug….., to people who can identify them.

      Legalizing marijuana and hemp would be a huge boost to urban agriculture and make it much more cost-effective.

      “Kentucky Senate votes to legalize hemp”

      http://www.usatoday.com/story/news/nation/2013/02/15/kentucky-hemp-production/1922695/

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  • “Another big advantage is that Indoor farming is less susceptible to pests and disease.”

    I don’t believe that for a second…indoor farming will probably result in an even further reduction in the diversity of the seed stock…one false move and a small pest could destroy an entire strain of urban crop before we noticed what is happening…and I have to wonder about the nutritional value of food grown in attempts at sterile environments under grow lights with municipal water…there is a reason that SWO isn’t certified organic and it isn’t all simply bad management.

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    • John Casper

      The only limiting factor on seeds that I know of is Monsanto’s monopoly.

      “Monsanto Seed Case Reaches U.S. Supreme Court”

      http://www.huffingtonpost.com/2013/02/19/monsanto-seed-case_n_2717971.html?utm_hp_ref=green

      I hope indoor farmers would not use genetically modified seeds, until such time as it can be proven they cannot modify our DNA. I’m not aware that such data exists.

      Just because you’re growing indoors doesn’t mean you have to use municipal water, except in a drought. Advocates for vertical farming and hydroponics say they use less water than those growing outside. I assume reduced evaporation is part of that. Whether their claim is true or not, I don’t know.

      Flooding will continue to be a big issue for Wisconsin agriculture. Any indoor farming has to be insulated against that.

      State of Pennsylvania produced the urban agriculture study below (not indoors).

      “Farming in Philadelphia: Feasibility Analysis and Next Steps”

      http://www.spinfarming.com/common/pdfs/STF_inst_for_innovations_dec07.pdf

      They’re confirming around $50,000/ in revenue from just vegetables from 1/2 an acre. They’re claiming around $39,000 in salary to a full time farmer. This is intensive farming. They’re harvesting multiple crops, many after just 60 days. They are counting as farm labor the time it takes to get it to consumers/restaurants.

      An early point of entry for Wisconsin indoor farms may be in the germinating, which effectively extends the growing season.

      We need working prototypes to better identify the problems and the solutions.

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  • For management and costs, have you compared Sweet Water to their competitors, the Wis. commercial fishing fleet? The Legislature and DNR, who manage the commercial fishing, fleet have subsidized the fleet not only with free public fish, but have also have taken, over the past 22 years, around $5 million of sport license money to offset the cost of commercial licenses. What has been the result of commercial perching, abuse, overfishing and the eventual closure of that fishery and the reduction of sport limits. Sport fishing provides 10 to 20 times the revenue of commercial fishing. More tourism type jobs have been lost then what commercials ever provided, yet the DNR and Legislature still favor commercial over sport fishing. Sweet Water got a one time $250,000 loan, their competitors took hundreds of thousands of dollars worth of perch, per year, for free and were paid to remove them and harm sport dependent businesses in the process. I don’t think Sweet Water is the community’s biggest concern, nor toughest fix.

       1 likes

    • John Casper

      Steve, do you have a url supporting “Sport fishing provides 10 to 20 times the revenue of commercial fishing.”

      I’m not aware of any commercial fishing in Lake Michigan.

      “The Decline of a Once-Great Fishery”
      http://www.jsonline.com/news/127244963.html

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      • Here are just 2 ulr’s, referring to sport/commercial value, there are others. There is also the common sense of why walleyes, northern’s, musky, salmon and trout aren’t netted on inland lakes or Lake Michigan, because they’re worth more if sport caught. There is also the USFWS surveys quoting values vs the USGS quoted values of commercial harvests.

        http://www.lmyellowperch.com/docs/Forum%20Notes%205-12-03%20%28dr.%20bishop%29.pdf

        http://articles.chicagotribune.com/1997-04-26/news/9704260120_1_perch-population-yellow-perch-lake-michigan

        Commercial fishing of Chubs, Smelt and Whitefish still take place in Lake Michigan. Commercial fishing of perch still takes place in Green Bay. Lake Michigan commercial fishing is only temporally closed, with 3 commercial fishers currently having the rights to over 40% of the future harvest of SE Wisconsin perch once the DNR decides to reopen commercial perch fishing. Walleye, Lake Trout, Lake Herring are also still listed as commercial species, despite not being netted in decades.

        As to your reference to Mr. Egan’s Great Lakes series, in his efforts to highlight invasive influences he missed those brought by nets and mismanagement. After all, Lake Michigan perch and alewife numbers were crashing before zebra mussels even showed up.

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  • toddf

    Looks like Sweetwater’s building is up for lease. http://urbanmilwaukee.com/2013/02/20/plenty-of-horne-school-switcheroo/ (near the end).

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