Innovative Partnership is Key to Financing New Industry

Individuals whose organizations have been involved in helping to bring Iatric Manufacturing Solutions to Morristown and in securing financing for equipment purchase and engineering costs recently gathered at the facility for a tour. Standing just outside what will be one of several product testing labs are (left to right) Marshall Ramsey, President of the Morristown Area Chamber of Commerce, Joe Molitor, Iatric General Manager, Chuck Morris, USDA Area Specialist, Greg Williams, AEC General Manager, LeAnn Sutton, AEC Member Services Advisor.

“This unique funding partnership is a great example of how good things can happen when entities work together across conventional boundaries for the greater good of the local economy.”

That’s the way Appalachian Electric Cooperative (AEC) General Manager Greg Williams characterizes the innovative arrangement that is making it possible for a new industry to locate in Morristown, bringing 250 new jobs to the Lakeway region. Iatric Manufacturing Solutions LLC will be renovating and expanding the former Foamex facility—a 435,000-square-foot building that has been vacant for the past eight years. Founded in 2017 as a subsidiary of Rockline Industries, the company is set to begin operations in late 2018 as a state-of-the art FDA-registered facility using temperature- and humidity-controlled workspaces to manufacture hygienic wet wipe products for use in the consumer, health care, food service, and hospitality industries.

Thanks to the financial sponsorship of AEC, a $2 million zero-interest loan to cover engineering costs and equipment purchase was made available through the United States Department of Agriculture (USDA). As a not-for-profit member-owned electric utility, AEC is serving as an intermediary—facilitating the award of the loan through the USDA’s Rural Economic Development Loan and Grant (REDLG) program, which provides funding to rural projects through eligible utilities all across the country.

“Some folks might question our involvement,” says Williams, “given the fact that the new Iatric facility is not located within AEC’s service area. After all, the Co-op won’t be gaining load as a result of the kilowatt-hours used by this manufacturing plant. But our Board of Directors was unanimously supportive of the idea of providing financial sponsorship to Iatric, even though we will not be supplying this facility with electricity. They looked beyond the potential for revenue to act on behalf of creating jobs and boosting the economy of our region. I believe their visionary approach is justified: after all, many people who are hired for these new jobs may live and shop within our service area. Their spouses may work somewhere on our system or their children may attend schools here. This is a ‘win’ for us all, and I’m proud that our Board looked beyond the boundaries of our Co-op’s service area to offer help that will benefit all our communities.”

“AEC has been a great partner for Iatric and we’re grateful for their help and support,” says Craig Roush, Executive Vice President of Rockline Industries. “Our company has always been dedicated to helping the communities in which we operate and we’re confident that our new Morristown plant will create a beneficial ripple effect throughout the community.”

“This project illustrates what can be accomplished when we work together collaboratively,” says Marshall Ramsey, Morristown Area Chamber of Commerce President. “This USDA program would not have been available but for the fact that AEC stepped up to provide a creative financing solution that will serve to revitalize a shuttered industrial complex and return the property to local tax rolls. Iatric’s presence in the East Tennessee Valley Industrial District is a game-changer. They will not only employ citizens from throughout the Lakeway area, but their commitment to beautification and local education will be a real credit to our community.”

AEC serves almost 47,000 meters along more than 2,500 miles of distribution lines in parts of Grainger, Hamblen, Hawkins, Jefferson, and Sevier counties. Although the Co-op has made it possible for many of its own commercial members to receive REDLG loans and grants, this is the first time it has served as a financial sponsor for a loan application to fund a project outside its service area.