Background on Mower County Feedlot Officer Controversy

1/30/08
Land Stewardship Project members in Mower County, Minn., have uncovered what seems to be public corruption that has resulted in a large-scale hog confinement facility being built against neighbors’ wishes in Lyle Township.

Below is an outline of the basic facts, as well as a timeline and list of supporting documents:

In March 2007, Lowell Franzen, the feedlot officer for Mower County, obtained for himself a feedlot permit for a 1,996 animal-unit hog confinement facility to be located on 14 acres of land he owned in Lyle Township, Mower County. The permit application (and final permit issued) listed “Lowell Franzen” as the party involved with this facility. There was no mention in the permit of Santos Group or Holden Farms.

This is a very large hog facility for Mower County. After receiving the permit, Franzen then sold the 14 acres of undeveloped farmland to the Santos Group, LLC for $292,000, which is approximately $243,000 above market value. Days later Franzen transferred the feedlot permit to the Santos Group. The officers of the Santos Group are Nick, Nate and Tyler Holden, brothers associated with Holden Farms, one of the largest pork producers in the country.

What was not publicly known at the time that the permit was obtained was that on July 9, 2006 — two months before any permits for the hog facility were applied for — a purchase agreement was signed by Nick Holden and Lowell Franzen. In the agreement, Holden agreed to reimburse Franzen for the costs of getting the permit and pay him $264,000 for the land with the permit. This means that although as of July 9, 2006, this was a Holden controlled-operation, that fact was kept from neighbors and government permitting agencies.

Minnesota Pollution Control Agency feedlot rules are clear in the definition of a feedlot owner, stating: “Owner means all persons having possession, control [emphasis added], or title to an animal feedlot or manure storage area.” (7020.0300 Definitons. Subp. 17.) Through this purchase agreement, as of July 9, 2006, Holden had control of the feedlot and was therefore an owner. By law, Holden should have been listed on the feedlot permit application along with Franzen, but was not.

Despite this evidence, the only official action taken to date is that Lowell Franzen has been placed on paid administrative leave.

July 9, 2006: Purchase agreement signed between Lowell Franzen, the Mower County feedlot officer, and Nick Holden. Under the agreement, Holden agrees to buy the property after permit is obtained and to reimburse Franzen for permit costs.
March 29, 2007: Lowell Franzen obtains a feedlot permit for a 1,996 animal-unit hog confinement facility in his name. The feedlot is to be located on 14 acres of property he owned in Lyle Township in Mower County.
April 13, 2007: Franzen sells the property, which consists of unimproved farmland, to the Santos Group, LLC for $292,000. This is approximately $20,857 an acre when average value for farmland in the area is $3,500. This is a total of approximately $243,000 above market value.
April 18, 2007: Mr. Franzen transferred his feedlot permit to the Santos Group. Signing as the owners of the Santos Group are Nick, Nate and Tyler Holden. These are owners of Holden Farms of Northfield, Minn., one of the largest hog producers in the country.

Purchase agreement signed on July 9, 2006, between Lowell Franzen and Nick Holden — see http://www.landstewardshipproject.org/pdf/purchase_agreement7-9-06.pdf.
A revised purchase agreement dated April 13, 2007 — see http://www.landstewardshipproject.org/pdf/purchase_agreement4-13-07.pdf.
Building permit application filed by Lowell Franzen on Sept. 13, 2006 — see http://www.landstewardshipproject.org/pdf/building_permit_application.pdf for a pdf copy.
Public notice to neighbors dated Sept. 27, 2006, announcing a public meeting on the proposed project on Oct. 5, 2006. For more information about the Lowell Franzen feedlot, neighbors are told they can call Lowell Franzen the feedlot officer — see http://www.landstewardshipproject.org/pdf/mailed_public_notice_to_neighbors.pdf for a pdf version.
Building permit issued to Lowell Franzen on Oct. 11, 2006, to build “two hog barns” — see http://www.landstewardshipproject.org/pdf/building_permit.pdf for a pdf version.
Minnesota Pollution Control Agency feedlot permit issued to Lowell Franzen on March 29, 2007, to operate a 1,996 animal-unit hog confinement facility— see http://www.landstewardshipproject.org/pdf/mpca_feedlot_permit.pdf for a pdf version.
Deed of the sale of the property on April 13, 2007, from trustees Lowell and Barbara Franzen on behalf of Lowell Franzen Revocable Trust to Santos Group, LLC. The deed tax of $963.60 indicates a sale price of $292,000 (deed tax is $3.30 per $1,000 of sale price). — see http://www.landstewardshipproject.org/pdf/deed_from_franzen_to_santos.pdf for a pdf version.
Minnesota Pollution Control Agency Transfer of Ownership Form dated April 18, 2007, transferring the feedlot permit from Lowell Franzen to the Santos Group and naming the owners as Nick, Nate and Tyler Holden — see http://www.landstewardshipproject.org/pdf/change_of_ownership.pdf for a pdf version.