NMTC Funding for KAMP Automation - Mascoma Bank

NMTC Funding for KAMP Automation

author imagePosted by Mascoma Bank on July 13, 2023

Mascoma Community Development (MCD) is pleased to announce the closing of $8 million in New Markets Tax Credit (NMTC) allocation to refinance the acquisition of land purchased from the City of Owatonna, Minnesota, and finance the building construction costs for a 47,728-square-foot industrial manufacturing facility.

The funding will allow KAMP Automation (KAMP) to relocate from its current operational facility into a larger, state-of-the-art location in Owatonna, MN, and continue to design and build custom automation systems for manufacturing companies, while creating quality STEM-related jobs.

“KAMP has undertaken a new construction project located in a severely distressed census tract, which we anticipate may catalyze future investment by creating and retaining accessible, permanent jobs and help further augment the existing industrial manufacturing cluster in Owatonna, Minnesota. MCD actively looks for opportunities like this where it may help support existing businesses, attract new ones, and encourage further economic growth while providing high-quality employment options for community members,” says Tad Atwell, Chief Operating Officer of MCD.

MCD is a Community Development Entity established by Mascoma Bank that creates impactful jobs in highly distressed, low-income rural and minor-urban communities. MCD also targets downtown redevelopment projects that help revitalize communities and provide services to residents.

KAMP designs and builds custom automation systems for manufacturing companies spanning from small- and medium-sized businesses to Fortune 100 enterprises. KAMP recently entered the medical devices industry—its customer base represents various industries including electronics assembly, medical devices, agricultural seed, and window manufacturers.

The KAMP project will retain 39 full-time equivalent (FTE) jobs for individuals currently employed at the existing facility and create 10 new FTEs upon completion. All FTEs will have access to comprehensive benefits and job training. It is estimated that 60% of the total jobs at the facility will be available to low-income persons and 100% of the jobs will be available to low-income community residents.

The project has received strong state and community support to allow companies like KAMP to build in rural areas such as Owatonna, to both create positive social impacts and boost the local tax base. Minnesota Department of Employment and Economic Development has provided nearly $1 million in grants related to forecasted job creation and the City of Owatonna has granted a TIF (tax-increment financing). The project aligns with the City of Owatonna’s strategic plan, which focuses on enhancing infrastructure, economic vitality, and quality of life.

The new building will include concrete walls and LED lights, and the development site will include holding pond improvements for stormwater runoff.

Kent Patterson, CEO of KAMP Automation, shares, “KAMP Automation truly appreciates the effort from financing partners and the City of Owatonna in creating a space for our employees to build world-class automation for our customers.”

U.S. Bank is investing New Markets Tax Credits equity to help finance this project. “We believe everyone deserves to live in a thriving community with access to opportunity, and our NMTC investments support business growth, job creation, and economic development in communities where they are needed most,” said Tom Oldenberg, Business Development Officer with U.S. Bancorp Impact Finance, a subsidiary of the bank and industry leader in providing financial solutions that help create positive impact for communities and the environment. “We’re excited to support KAMP’s expansion and the new jobs it will create, including training and quality benefits.”

MCD is pleased to report that this project has also made possible MCD’s grant of $40,000 to a third-party CDFI (Community Development Financial Institution) partner, Midwest Minnesota Community Development Corporation (MMCDC), headquartered in Detroit Lakes, Minnesota. This grant, in partnership with MMCDC and the local Owatonna Independent School District (761 Foundation, a 501c3 tax-exempt organization), will provide funds to support the 761 Foundation’s mini grant program. Each year, the Foundation awards mini grants to programs and activities that enhance educational opportunities for all students. These funds will specifically support science, technology, engineering, the arts, and math (STEAM) mini grant needs. MCD takes great pride in supporting organizations that strengthen the communities they serve.