JACKSON - A north Mississippi meat processing facility wracked with financial and mechanical problems is suspending its operations until after the Thanksgiving holiday.
Richard Hall, president of Mississippi Beef Processors LLC in Oakland, said in a written statement Wednesday that equipment problems are forcing the shutdown.
The company is under scrutiny by Mississippi officials who are concerned about a $35 million loan backed by taxpayers' dollars.
Employees were notified of the shutdown Tuesday, Hall said. Jason Brandt, the plant's human resources director, said the plant's approximately 400 employees won't be paid during the shutdown.
Hall said the company would repair equipment in the processing plant's basement and in the adjacent rendering plant.
"We simply cannot process the number of cattle that we need to process until the rendering plant is fully operational. It's been one problem after another," Hall said in the news release.
The beef processing operation was designed to process 1,000 head of cattle a day. The plant won't reopen until it can handle that capacity, Hall said.
The rendering plant turns inedible portions of the animals into usable products by cooking the materials at a high temperature and pressing the product into bone meal or fertilizer.
"These problems were not of our making, but they have negatively impacted our ability to operate profitably. These problems also have given this project some bad press which it doesn't deserve," Hall said.
State Rep. Tommy Reynolds, D-Charleston, said problems with equipment or things such as water and sewer lines are common in new manufacturing plants and he hopes the meat processor resolves its equipment difficulties. He said the plant has provided jobs in an area with a long history of economic struggles.
State Auditor Phil Bryant won't confirm or deny whether his office is investigating Hall's company, but the auditor is responsible for tracking such economic development bond projects.
Mississippi's total investment in the project is $43.5 million, including the loan and a grant and management contract from the Land, Water & Timber Board.
A 2001 study by Mississippi State University Extension Service estimated the plant's total impact on annual industry sales at $139.8 million, which includes $91.3 million of processed beef sold to wholesalers. Total employment impact, considering spin-off jobs in support industry, would be 1,168, the study said.
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