NUEDC has long history in New Ulm

NEW ULM — Last month the City of New Ulm cut funding to the New Ulm Economic Development Corporation (NUEDC) in favor of hiring an assistant city manager in 2018.

The city had been contributing $50,000 per year to the organization. The Public Utilities Commission (PUC) has provided a matching $50,000 each year. The PUC will continue to fund the NUEDC in the amount of $50,000 through 2018, but the city funding cut will have an impact on the future of economic development within New Ulm.

The NUEDC first came into being in 1996, but its history can be traced back to the early 1950s with New Ulm Industries Inc. The group was the predecessor to NUEDC.

NUEDC Coordinator Brian Tohal has the minutes from New Ulm Industries’ first meeting on May 6, 1952. Tohal said the impetus to start the New Ulm Industries was to bring Kraft to New Ulm.

“They used their own money to go to Chicago, Kraft’s headquarters, and they convinced them to come to New Ulm,” he said.

Tohal is uncertain how the group members learned Kraft was thinking of expanding its operation, but by taking action, they forever changed the economic future of New Ulm. Kraft Foods recently made a $100 million investment in upgrades to New Ulm. Nearly all Velveeta cheese products are produced in New Ulm, making it the home of Velveeta.

New Ulm Industries were successful in bringing other businesses to New Ulm, including 3M. The group operated similar to the modern NUEDC, with one notable difference. New Ulm Industries was a for-profit organization and NUEDC is a non-profit.

As a for-profit business, New Ulm Industries was forced to pay income tax on buildings and properties they owned. The company sold stock to investors. However, they never paid out dividends to their investors. It was understood those investing in New Ulm Industries were doing so to improve their community and did not expect a direct monetary return.

In 1996, New Ulm Industries was dissolved and the NUEDC was created as a private non-profit corporation that partners with the City of New Ulm and Chamber of Commerce to provide economic development services to the benefit of New Ulm. Tohal has served as the coordinator for NUEDC since the beginning.

The current NUEDC Board consists of eleven members: Bill Swan, Dean Laraway, Dustin Cross, Jeff Dittrich, Jerry Kauffman, Julie Baumgartner, Mark Petterson, Mike Lieb, Randy Schroeder, Rick Christiansen and Shannon Hillesheim.

Each of the board members serves a three-year term and is limited to three terms for a possible nine years with NUEDC. All the members come from a variety of businesses and industries throughout New Ulm and are long-time residents of New Ulm.

In the last 10 years NUEDC has put together nearly 300 proposals for business prospects. Included in that number are manufacturers who opened shop in New Ulm, such as United Commercial Upholstery, Spec Sys, Frontier Labs, DLC Manufacturing, Elkay Wood Products and Beacon Promotions.

Today the NUEDC faces an uncertain future due to the $50,000 funding cut. During a recent meeting, the NUEDC Board of Directors decided to continue funding Tohal’s coordinator position full time through 2018. To cover expenses, the corporation will use reserve funds and is seeking outside funding sources.

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