PALMER – Todd Elsberry had no plans to buy a struggling slaughterhouse.

Elsberry, a former police officer who is the state’s largest hog producer, had to scramble to slaughter hundreds of animals after the Mt. McKinley Meats & Sausages plant closed earlier this year.

The slaughterhouse is the only U.S. Department of Agriculture certified processing facility in the south-central. Any red meat destined for commercial markets – grocery store refrigerators, farmers’ markets, wholesale distribution – needs this federal stamp.

At Elsberry Farm, Todd and his wife, Sherrie, wondered if it was time to quit the business. Elsberry said he was considering a mobile abattoir or even building a small factory on the farm.

He asked the director of the Alaska State Agricultural Division, who provided advice throughout his decision, if anyone else was filling the void and putting in place a sort of butcher’s option.

Nope.

“It kind of boiled down to us,” Elsberry said in a recent interview. “It was a little scary. We couldn’t go out of business. I just couldn’t stop. That’s how fragile it is here.

So now the slaughterhouse is in new hands: the self-proclaimed “elected by default” farmers of the North Pole.

Earlier this month, at a groundbreaking ceremony on the death floor, the Elsberries joined state officials and the real estate agent who is a minority partner in their new venture, Alaska Meat Packers. Inc.

The sale is “very exciting news” for food security in the state, Natural Resources Department Commissioner Corri Feige said at the event. “Alaska is at the bitter end of the supply chain.”

Cattle ranchers in Alaska face a long list of challenges, including finding affordable feed, transporting animals to the Palmer slaughterhouse from remote farms, and finding large enough tracts of farmland to support a real boom in meat production.

[The last days of the Havemeister Dairy: Alaska’s oldest commercial milk producer shuts down]

But commissioning the Alaska Meat Packers facility is a critical step, according to industry members. At present, there is not enough local red meat to meet current demand.

Mat Valley Meats, near Wasilla, sells everything from beef sides to homemade bratwurst sausages and dry-cured bacon.

“We can’t even get a quarter of the Alaskan-grown beef that we can sell,” said manager and co-owner Bailey Stamper.

Elsberry, a farmer who knows what the industry needs, is a promising choice to bring the abattoir into a new era, Stamper said. Now is also a good time to boost the markets for cultured meat in Alaska: Soaring meat prices in the Lower 48 have normally expensive local produce appearing more affordable.

“Sounds like this is something Alaska needs to jump on, get our agriculture where it needs to be,” she said. “There are a lot of opportunities for farming, not enough for sales. “

The plant began processing meat this month under Chris Miller’s leadership, to cheers from small ranchers who say they are scrambling to find butchery services this year.

Rick Melton, a general contractor from Willow, raises cows – his farm offers dairy slices – and pigs. He was in the process of building a new pigsty when he learned that the factory, formerly known as Mt. McKinley Meat & Sausage, was closing.

Melton was so excited that the slaughterhouse was in new hands that he watched the ribbon cutting live. The Meltons own 40 acres and the younger generation hopes to expand the operation.

“It all depends on the presence of these guys,” he said. “You are not here and the USDA is not here, I’m telling you, we got wet. Everything is watered … Alaska needs this.

Elsberry came to Alaska from Idaho, where he grew up on a dairy farm, then worked as a police officer and deputy sheriff before moving to the borough of North Slope to work as a village officer in the late years. 1990. He and Sherrie bought the farm in 2000 – an entire 640 acre section purchased in a state land sale.

“Since then, we have been leading the battle,” he said. “It’s a lifestyle.”

He brings several strengths to the role of manager of a facility that for decades struggled under state ownership for profit, according to others.

On the one hand, he already has enough animals to cover operating costs: around 500, with plans to increase production to 4,000 a year, Elsberry said. He will make weekly trips from the 640-acre farm at the North Pole to a barn in Delta to the Palmer plant.

But there are plenty of other farmers who will be using the plant, he said. “They may be smaller producers, but nevertheless you start to total the animals, there are a lot of animals there. Sure, that’s what will make it work.

Elsberry is a businessman with good instincts, said Arthur Keyes, a former director of agriculture under Gov. Bill Walker who inherited the slaughterhouse while still in state hands. .

There is no state or federal money for the plant now.

But over a decades-long period starting in 1986, the state pumped millions into the slaughterhouse – and it ran into the red, with an average deficit of approximately $ 100,000 per year since 2008.

In 2015, the plant had three government employees, for a total of more than $ 360,000 between them. Thirteen inmates provided work. The legislature had approved just over $ 2 million to run the plant for a year. Expenses totaled just over $ 1.7 million and revenues were less than $ 155,000, with costs covered by the state’s revolving loan fund for agriculture.

The plant has been operating in the dark for the past eight or 10 months, it has been in state hands, Keyes said. The records at the time indicated $ 42,448 in profit.

The problem for most of the life of state operations was the intentionally slow pace of processing to allow prisoners to train instead of focusing on butchering, he said. “For 30 years, the factory has operated as a DOC training center. They therefore limited the number of animals, limited processing. “

The state has made several attempts to transfer the plant to the private sector since operations resumed in 1986 when the original owners defaulted on a loan. However, attempts to sell or lease the plant in 2000 and 2002 were unsuccessful.

In December 2016, the Alaska Agriculture and Conservation Council voted unanimously to sell the plant to Mike’s Quality Meats owner Greg Giannulis for $ 300,000, less than its estimated value. .

Giannulis decided to sell the slaughterhouse this year because it was not a long-term prospect, he said.

Real estate broker Bill Borden handled the sale. Borden, who grew up on a farm, said he worked with Giannulis and the state’s Agriculture Division director David Schade once the property was brought to market.

“They were all like, ‘We have to keep this slaughterhouse,’” Borden said.

The people involved do not disclose the purchase price. Giannulis said he received another offer for more money, but wanted to keep the facility as a slaughterhouse.

Along with Elsberry and his wife, the company is partly owned by Borden and the real estate company he owns, High Caliber Realty. Borden has a 1% stake and the company has a 13% stake, according to state records.

Borden said the minority partnership is essentially “deferred compensation” tied to the sale of the property – rather than getting full payment up front – given the importance of keeping the plant running.

“We often talk about food sustainability in Alaska,” he said during last week’s ribbon cutting. “He’s eclipsed by 630-pound cabbages and 65-pound cantaloupe. We forget how we have to feed Alaska.

Daily News photographer Loren Holmes contributed reporting for this story.