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Montana Stale Library

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Vol. 4., No. 3.

March, 1959

News Publication — Montana State Planning Board

1958 a Good Year for Montana Agriculture

Montana had a near-record agricultural year in 1958, according to
preliminary figures released by the Montana Crop and Livestock Report-
ing Service in Helena. .

In terms of dollar value of agricultural
production. 1958 was second only to
195rs bumper year. Total gross value
reached $274.4 million for crops, and
$243.3 million for value of livestock — for
a total $517.7 million value of all agricul-
tural production. Xht^ total in !9S! wns
$559.0 million, and in 1957 was $470.1
million.

This figure of gross value has some
overlap, according to P. J. Creer, Agri-
cultural Statistician in charge of the Hel-
ena office. This is because some of Mon-
tana's crop production is transformed
into livestock within the state. However,
the figure is valid for comparison with
other segments of the economy.

Agriculture Still Number One

Value added b y manufacture was
S243.0 million in 1956, and value of
minerals produced was $177.0 million in
1958. No recent estimate of the value of
tourism to the state's economy has been
made. Agriculture thus remains number
one in the Montana economy.

Reduced prices for most crops in 1958
were more than offset by larger produc-
tion. Wheat tumbled from $1.84 to $1.61
per bushel last year, but the greater har-
vest boosted its value to $162.2 million,
as compared with $150.9 million in 1957.
The value of wheat was 59.1 per cent of
the total value of all crops produced,
followed by hay with 18.0 per cent and
barley with 13.4 per cent.

Record Yields

Yields per acre for most crops in 1958
exceeded those for 1957. Winter wheat
yield equaled the record established in
1955 and durum matched its high 1955
figure, according to the Reporting Serv-
ice. The oats and barley yields were the
highest since 1927, and rye the highest
since 1917. Potatoes established a record
high this year, and the yield of sugar
beets was second to last year's record.
All hay came through with the highest
yield since 1928.

The aggregate production of crops in
Montana in 1958 was second in size (on
a weight basis) only to the record 1955
harvest. Severe drought in northeastern
counties prevented the attainment of a
new record. About 8.4 million tons of
crops were harvested last year. This
compares with 7.8 million tons in 1957.
and the 1947-56 average production of
6.9 million tons. Crops were taken from
8,793,000 acres in 1958, which was 232,-
000 acres less than in 1957.

However, Montana is no longer the na-
tion's third largest wheat producer, as it
was last year. Both Nebraska and Okla-
homa have overtaken Montana. In 1956

Montana was third with a 87.0 million
bushel crop; last year it was only fifth
with a total production of 100.7 million
bushels.

Livestock Value Up

Value of livestock also increased ap-
preciably last year over previous years.
The 1947-56 average value of livestock
production was $190.9 million, and the
1957 value was $202.3 million.

Total cash receipts of agricultural prod-
ucts are estimated by the Montana Crop
and Livestock Reporting Service on a pre-
liminary basis at $444.2 million for 1958.
This is the amount received by the farm-
er for crops and livestock sold. It is not
comparable to that of total value of
production.

Amendments Help
Zoning In Suburbs

Amendments to Montana's city plan-
ning legislation were passed by the 1959
legislative session, and signed into law b}'
Gov. Aronson on March 16.

The amendments, which were sub-
mitted to the legislature by Montana's
14 City-County Planning Boards (see IN-
DUSTRIAL HORIZONS, Dec. 19581,
strengthen the zoning powers of boards
of county commissioners represented on
planning boards, in urbanized areas sur-
rounding incorporated cities. They also
provide that:

• I. Citizen members of citv-county
planning boards must be freeholders
(owners of real property) resident within
the planning board's jurisdictional area.

• 2. Boundaries of the jurisdictional
area must be approved by the board of
county commissioners.

Plats Must Conform to Master Plan

• 3. After a master plan and subdivi-
sion regulations have been adopted by
the city council and board of county
commissioners, all new plats must be cer-
tified by the planning board as comply-
ing with the master plan.

• 4. Agricultural lands, as well as min-
eral and forest lands, are exempted from
planning controls.

The State Senate added an amendment
which limits the size of the area under
the jurisdiction of a city-county planning
board to si.x miles from the city limits
in counties under 20,000 population, or
twelve miles in counties over 20,000
population.

Copies of the new amendments are
available from the State Planning Board.

Culbertson Acquires
New Saf flower Plant

Culbertson, in northeastern Montana,
has been selected as the site of a saf-
flower-processing plant, according to E.
A. Hill, assistant vice president of Pacific
Oil Corp., of San Francisco. The an-
nouncement culminates two years of spec-
ulation about the plant's location.

I he firm has been contracting acreage
in northeastern Montana and western
North Dakota for over a year, and this
year 80,000 acres of the seed crop will
he bought.

Safflower is now grown mainly in the
Sacramento Valley of California, but it
is a promising cash crop for farmers in
many semiarid regions such as the North-
ern Great Plains. Research on growing
methods has been carried on for several
years at the Eastern Montana Branch
Agricultural Experiment Station at Sid-
ney. The use of safflower oil has been
increasing rapidly in recent years, pri-
marily as a raw material for the paint
and varnish industry.

Used by Heart Patients

However, safflower has also been used
for many centuries as food in Asia. Re-
cently it has attracted considerable in-
terest as an edible oil because it is a
highly unsaturated oil having high lino-
leic acid content. Linoleic acid is a fatty
acid which recent medical research indi-
cates may be beneficial in reducing cho-
lesterol levels in the blood. For this rea-
son, small quantities of the oil have been
sold to pharmaceutical firms who are
marketing products aimed at combating
arteriosclerosis. In addition, the meal that
remains after extraction of the oil is rec-
ognized as an excellent protein supple-
ment for livestock feed.

Culbertson was selected, according to
Hill, because it is near the center of the
safflower acreage in the Northern Great
Plains, and because of its proximity to
promising markets for safflower meal.

Wolf Point, Sidney, and Williston, N.
D., had also been under consideration.

Byproduct Used for Feed

The new plant, in addition to crushing
safflower to extract industrial oil for ship-
ment to Eastern manufacturers, will sell
safflower meal to surrounding feedlots,
and to ranchers for winter feeding opera-
tions.

This plant marks an important step in
the effort to utilize Montana's agricul-
tural products in manufacturing opera-
tions. Similar oilseed crops — such as
mustard, flax, and soybeans — may also
be the basis for such plants in Montana.

Two New Spud Chip Plants

NALLEY'S BILLINGS PLANT
TO SI' PPL Y FOUR STATES

Poliito chips to he disCrihiilvd in four
slates will be niaiiufiicliired by mid-
March in a ne« $100,000 faclor> in Bil-
linus, according to an announcement b>
officials of Nalle.v's Montana Company.

1 he polalo chip plant, under construc-
tion since December in the Northern Pa-
cific Industrial Sites just west of Billines.
will be operated by a wholly-owned sub-
sidiary of Nalley's. Inc., of Tacoma. The
Montana subsidiary was incorporated in
Montana. October 28. 1958.

Initial output, with eight workers on
a single shift, will process 10,000 pounds
of potatoes per day to manufacture ap-
proximately 2,500 pounds of chips daily.
These will be sold throughout Montana,
and in northern Wyoming and western
North and South Dakota.

Double Shift for Summer

William T. Sampson, superintendent of
the Billings plant, predicts the plant will
be working a double shift by mid-May.
and eventually will employ twenty Bil-
lings residents. Sampson, who formerly
was assistant superintendent of Nalley's
Tacoma potato chip factory, has been
associated with the parent firm ten years
in the chip division. Nalley's has other
chip plants in Portland. Spokane, Van-
couver. B. C. and Brooks. Alta.

The Billings factory will utilize ap-
proximately l.?00 tons (26,000 one-hun-
dred pound bags) of potatoes annually on
a one-shift basis. Double shifts planned
during the summer picnic season and pre-
ceding the Christmas-New Year's holiday
season would double potato purchases
and output, according to Sampson. He
estimates production during the first year
will exceed two million packages of po-
tato chips.

The Billings plant will operate in a
I00x60-foot prefabricated steel (Butler)
building constructed by the R. 1-. Strat-
ford Co., of Billings.

Selection of Billint>s

Growth of population and available
markets in the Billings area determined
location of the plant, Sampson says. He
adds that Billings also was selected be-
cause of transportation facilities and the
possibility of future distribution of other

BIG STACK PLANT IN
GREAT FALLS

In Great I'alls, con.struclion is par-
tialis completed for the new 40x121-
fool' $26,000 building of Bif- Stack
Chip and Food Company at 721 Sixth
St.. S.W.

Tim r. Calaway, owner and man-
ager, reports that expanded sales,
causing an increase in personnel and
production, make it necessary to ex-
pand his plant. Big Stack began man-
ufacturing potato chips two and one-
half years ago in a small garage. The
firm soon outgrew this building and
moved into a nearby warehouse, which
now is too small, according to Cala-
way. The firm normally employs 20
people, and plant capacity is 6,000
pounds of potatoes per shift. The
firm used 6,270 cwt. of Montana po-
tatoes in 1958, and 2.970 cwt. of Cali-
fornia potatoes. Sales were substan-
tially over $100,000.

"Wc service all of central Mon-
tana," Calaway reports, "from Havre
and the Hi-Line to I.ewistown, Kali-
spell, Livingston, Helena, Butte, Ana-
conda, and Deer Lodge, as well as
Great Falls. Before our plant opened,
these areas were served by chips made
in Spokane and Portland, among other
places, .So nc are proud to have
brought a hobby from my wife's kitch-
en stove to one of Montana's newest
and most progressive industries."

Nalley's products in the four-state area,
although the company has no immediate
plans along these lines.

The Tacoma plant now makes salad
dressings, syrups, pickles, baked and fried
snack items, and one-dish meals or can-
ned meats for sale in this area.

Local Spuds

Nalley's Montana Co. now has field
men contacting growers in Montana and
northern Wyoming for delivery of pota-
toes from the 1959 crop, Sampson adds.
The company hopes to be able to obtain
all of its potatoes from Montana and the
Big Horn Basin area of Wyoming in the
future. Kennebec and Russet white po-
tatoes are preferred varieties.

Architect's drawing of the new Nalley's Montana Co., p<itat<i chip plant now
being built in Billings. I he plant will serve a four-slate area, and demonstrates the
growing attraction of Montana localiuas to .serve regional niarkel.s.

Page Two

Billings and Great
Falls Slug It Out

The friendly rivalry between Billings
and Great Falls — Montana's two largest
cities — continues unabated.

Both have a population upwards of 70,-

000, according to recent estimates of their
respective City-County Planning Boards,
and both have experienced continuous
growth in the past decade.

The prosperity of Billings is based
largely on servicing a large wholesale
trading area stretching into Wyoming and
Dakota, aided by three large oil refin-
eries and offices for major companies
producing in the Willislon Oil Basin (see
INDUSTRIAL HORIZONS. Apr. 1958).

Great Falls has a large ADC and SAC
airbase and the Anaconda Company elec-
trolytic metals smelter. The city is the
center of Montana's dryland wheat area.

Billings — Billion Dollar Market

Billings has become the state's first city
to attain an annual market rating of a
billion dollars or more, according to the
Billings Chamber of Commerce. Bank
debits in Billings for the 12 months of
1958 totaled $1.072.354,000— an increase
of nine percent over the aggregate for
1957. Bank debits for the most part are
checks against depositors" accounts and
thus represent payments for goods, serv-
ices and debts. They are considered an
excellent indicator of business activity.
Ranking second in the Treasure State was
Great Falls, which reported a total of
$832,201,000.

Great Falls Leader in Construction

Great Falls, on the other hand, is
booming its record as the leading city in
Montana for new construction in 1958.
Out of a total of 4.574 new permits. 1,263
(or 36 percent) were granted in Great
Falls. By value, permits for structures
worth $11,092,694 were granted in Great
Falls, from a Montana total of $35,-
926,738. Billings was second in 1958 with
531 new permits, valued at $4,516,900.

One reflection of the competition be-
tween these two Capitals of the Northern
Great Plains is the desire to attain Stand-
ard Metropolitan .Area classification in
the I960 census. To qualif> for this spe-
cial status, the population vsilbin the city
limits must be 50,000 or moie as of .April

1. I960. Great Falls has already quali-
fied, according to preliminar\ estimates.
However, more than one-third the resi-
dents of Billings live outside the city
limits, most of them on the West Side.
therefore, the Cit> of Billings and the
Billings Chamber of Commerce are con-
ducting an intensive annexation campaign
to assure sufficient populallon lor 14(>0.

Not onl> is special population and
luMising hhick data collected for inelro-
piiiitan areas, hut man> industries con-
sider this a breaking point between "city"
and "town." If (Jreal I'alls is the 4ml>
metropolitan area in Montana during the
l9A0's. according to the Billings Chamber
ot C<iniinerce, there will be a lot of red
faces in Killings.

INDUSTRIAL HORIZONS

NEW MILLS INCREASE LAKE COUNTY'S
LUMBER EMPLOYMENT TO 600

Poison is fast becoming a major lumber capital, according to the
energetic manager of the Poison Chamber of Commerce, Dorris Stalker.

In the past year, four large new lum-
ber mills have been announced in the
Poison area, and another is undergoing
major expansion. Total new investment
in these operations, with planned expan-
sions, will result in new basic employment
of 400 men, new investment approaching
$} million, and 450,000 board feet per
shift new sawmill capacity, according to
Mrs. .Stalker.

Plum Creek

Largest of the new mills is that of
Plum Creek Lumber Co., at Pablo, seven
miles south of Poison (see INDUSTRIAL
HORIZONS, July-Aug., 19.58). Utilizing
timber from Northern Pacific, national
forest, and other lands, the new plant
represents an investment of $1.5 million,
with employment of 75 and an annual
payroll of $350,000. Ultimate employ-
ment, with contemplated expansions, will
be 150, The sawmill, when completed,
will have a capacity of 100,000 board
feet of rough lumber per shift. The plan-
er is already in operation, taking rough
lumber from several small mills in the
area to utilize capacity. Timber is brought
from as far away as 100 miles. Four to
six cars of chips per day are being ship-
ped to the Waldorf Paper Products Co.,
pulp mill at Missoula.

New Dupuis Bros. Mill

$220,000 per year. The plant is expected
to alleviate the unemployment of the
Flathead Indian tribe.

Two Other Mills

Two other new mills are being built
near Poison — that of Thomas Wheeler,
which produces rough lumber for Plum
Creek, and of Pete Danielson, which will
produce 10,000 board feet of studs per
shift.

Poison Plywood Expansion

Another large mill is the Dupuis Broth-
ers Lumber Co., operation which early
this year moved to a site on the outskirts
of Poison from Dog Lake. The plant
will be finished in July, 1959, and will
hire 60 men per shift, producing 60,000
board feet per shift. Payroll will be about

In addition, the Poison Plywood Com-
pany, Montana's only plywood manufac-
turer, is undergoing an important ex-
pansion which will bring into operation
a new sanding operation and warehouse
space. The firm has been making ply-
wood since 1951 and employs 85 men.
The mill now has a capacity of 60,000
board feet of rough lumber per shift,
and 1.5 million square feet of -^s" ply-
wood per month. The rough lumber ca-
pacity is being increased substantially.

In addition. Mrs. Stalker reports a
rumor is circulating that another large
lumber operation will be built in Poison.

Thus, the Poison area is achieving a

very healthy integration in its wood prod-
ucts industry — from rough lumber,
through finished lumber, studs, ties, and
cores, to plywood and chips for pulp.

Total employment in Lake County's
wood industries (logging, lumbering,
secondary manufacturing) approaches
600 — a notable increase for an area
which only 10 years ago was primarily
agricultural.

"Gold Mine On Main Street"
Film Now Available

.'\ new film on industrial develop-
ment is available (o service clubs,
community groups and other organi-
zations in Montana.

t^ntitlcd "Gold Mine on Main
Street," ( h e 25-ininutc color film
shows step by step (he methods used
by communities all over (he country
(o attract new industries. The film
deals with such factors as industrial
development corporations, advertising,
organizing for community action, in-
dustrial zoning, buildings as an induce-
ment to new industry and developing
a good "business climate."

The film was produced for the State
Planning Board by the publishers of
"Industrial Development Magazine" in
Atlanta. It is available for free show-
ing to any group in Montana from the
State Planning Board, and comple-
ments the previously-acquired film on
city planning. "Now for Tomorrow,"

BRIEFS . . .

A bill to pave the Alaska Highway has
been introduced into Congress, with Mon-
tana's Senators as co-sponsors. The bill
would appropriate $11 million a year for
six fiscal years, on condition that the
Government of Canada participate equal-
ly in the program. The Canadian Gov-
ernment would also agree to maintain the
Canadian section of the highway after
completion and make it accessible on free
and non-discriminatory terms to United
States traffic. The 300 miles of the high-
way in Alaska are paved now: only the
1,200 miles within Canada remain un-
paved. This bill dovetails with the pro-
gram of the Alaska International Rail and
Highway Commission, for which the .State
Planning Board is preparing a brief on
the importance of adequate transportation
to Alaska for Montana industry. With
the proposed Interstate Highway entering
Canada at Sweetgrass — the gateway to
Alaska — Montana would benefit from an
all-weather highway all the way to the
49th state.

Aerial view of the $1.5 million Plum Creek lumber mill between Poison and Ronan. The mill, when completed, will have a capacity of

100,000 board feet of rough lumber per shift, (Flathead Courier photos).

INDUSTRIAL HORIZONS

Page Three

NEW SBIC PROGRAM FOR
AIDING SMALL BUSINLSS

For 10 years Congress discussed cap-
ital banks for small business. In July
of 1958 it acted. Tbe result was the
Small Business ln>cstment Act. designed
to open up a flon of e(|uit> funds and
long-term loans to small firms.

The plan is to offer government moncv
to encourage pqvate institutions which
will in turn finance small business. Fed-
eral mone> will take the form of loans
to state and local development credit cor-
porations and to new Small Business In-
vestment Companies formed under the
bill. The Small Business Administration,
which Congress made pemianent this
year, will he in charge of the program.

Congress authorized a revolving fund
of $250 million to finance the new pro-
gram, with a limit of $50 million in the
first year.

The SBIC can borrow an amount up
to one-half of its capital from SBA. With
SBA subordinated debentures classified
as equity, an SBIC could go into business
with $150,000. borrow $150,000 from the
SBA on subordinated debentures, 'and
then borrow an additional $150,000 as an
ordinary loan. If more private capital is
put in. then government borrowing pow-
er is increased.

The SBIC can also borrow from other
sources. National banks are authorized
to participate by both loans and the pur-
chase of stock, up to one per cent of the
bank's capital and surplus.

The SBIC's will provide equity capital
by purchasing convertible debentures
from small businesses at terms set hv
SBA regulations. The firm receiving aid
through debentures will be required to
purchase stock in the investment company
at a minimum of three to five per cent
of the amount of the loan, the exact
amount to be determined by SBA. In this
way the companies eventually become
mutual institutions.

Loan Conditions

The SBIC will also make long-term
loans to small business under these con-
ditions: ( I ) SBA will set the maximum
interest rate, (2) the maximum maturity
is 20 years, with one possible 10-year ex-
tension, and (3) an SBIC can lend no
more than 20 per cent of its capital and
surplus to any one business. The SBA,
which has not yet determined the rates,
is limited to S'/i per cent on loans it
makes directly to small business.

Some interest has been shown in sur-
rounding states in formation of Small
Business Investment Companies. Pre-
liminary work on formation of five such
companies is underway in Washington.
Oregon, and Idaho. Two groups have
evinced interest in the program in Mon-
tana.

Loans to Development Foundations
Other sections of the Small Business
Investment Act of 1958 provide for loans
to stale-chartered development credit cor-
porations (killed h> 1959 legislature in
Montana) and to local industrial doelop-
nient foundations. A further provision
of the act provides $27.5 million for an-
nual grants of $40,000 to research institu-
tions in each state for research into the
problems of small business. .Several Mon-
tana organizations, under the leadership
of the Slate Planning Board, arc prepar-
ing a coordinated application for this
grant.

Further information on Small Business
Investment Companies is available from
either the State Planning Board or SBA.

CREDIT CORPORATION
BILL FAILS PASSAGE

Enabling legislation for develop-
ment credit corporations (HB 200. see
INDUSTRIAL HORIZONS. Febru-
ary. 1959) was again killed in Senate
committee, as it was in the 1957 legis-
lative session. Thirteen states have
now authorized creation of these in-
stitutions for supplemental capital to
small industries with growth poten-
tial. Prepared by a group of persons
familiar with financing small busi-
nesses in Montana. Montana's bill
would have allowed banks and other
financial institutions to spread the
risk in providing long-term risk capital
to promising new industries that find
themselves unable to meet loan re-
quirements of commercial banks. A
stale with a development credit cor-
poration definitely has an advantage
in industrial development over those
without.

Urban Renewal Bill
Passed by Legislature

Urban renewal (slum clearance) enabl-
ing legislation was passed by the legisla-
ture and signed into law by the Governor.
I he legislation is similar to that in effect
in 41 other states. It allows cities to re-
develop slum areas, with federal assist-
ance. Congress appropriated $175 mil-
lion for urban renewal in fiscal 1959;
estimates for next vear run as high as
$600 million.

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