To: BOARD OF SUPERVISORS
From: Executive Office
Meeting Date: September 23, 2025
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Department Contact: |
Darcie Antle |
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707-463-4441 |
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Department Contact: |
Kelly Hansen |
Phone: |
707-463-4441 |
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Item Type: Consent Agenda |
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Time Allocated for Item: N/A |
Agenda Title:
title
Adoption of Resolution Authorizing the Execution of Landlord and Mortgagee Waiver Agreement and Other Acts Related to the Community Development Loan for Agwood Mill & Lumber Company
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Recommended Action/Motion:
recommendation
Adopt Resolution authorizing the execution of landlord and mortgagee waiver Agreement and other acts related to the community development loan for Agwood Mill & Lumber Company; and authorize the Chair to sign same.
End
Previous Board/Board Committee Actions:
On November 10, 2009, the Board of Supervisors adopted Resolution 09-260 approving an application for funding from the economic development allocation of the State Community Development Block Grant (CDBG) program and identifying the responsible party for grant administration. The application included a $2,000,000 business loan to Agwood Mill and Lumber Company.
On August 28, 2012, the Board of Supervisors authorized the Executive Office to transmit a letter to the Savings Bank of Mendocino County stating the County’s acknowledgement of and lack of opposition to a $500,000 loan the bank approved for Agwood Mill & Lumber Company.
On June 3, 2025, the Board of Supervisors adopted Resolution 25-103 authorizing the execution of subordination agreements and other acts related to the community development loan for Agwood Mill & Lumber Company.
Summary of Request:
In 2010, the County issued a $2 million loan to Agwood Mill & Lumber Company using economic development Community Development Block Grant (CDBG) grant funds. This assistance was prompted by the significant economic downturn caused by the national recession in 2008, which had a profound impact on the housing construction industry. The loan has a 2% interest rate and is scheduled to mature on September 1, 2030.
As of August 2025, 70% of the total loan has been repaid. The County's loan servicer, EDFC, confirms that Agwood is current on all payments and has no history of delinquency.
Agwood formally requested that the County sign a Landlord and Mortgagee Waiver on August 26, 2025. This waiver would allow them to move forward with securing financing from American AgCredit for the rebuilding an outbuilding on their property that was destroyed by a fire in 2024.
The request includes waving the County's rights as a mortgagee regarding the new facility that will be constructed on the property. This is a requirement as part of the agreement with American AgCredit. The Landlord and Mortgagee Waiver agreement seeks to exclude the new facility from any future liens that the County could place upon it in the event of default on the County's existing Business Loan of $2,000,000 from the Community Development Block Grant program. By signing this agreement, the County would waive any rights it has as a mortgagee to the new building and protect it from future liens.
Agwood Mill & Lumber was initially established in 1978 by the Huffman family and operated under local ownership for many years. In 2017, the business merged with Conrad Forest Products, resulting in significant expansion and an increase in employment to as many as 75 people at the mill. However, due to market challenges, Conrad began downsizing in 2024, ultimately laying off 45 full-time employees, and the mill faced the possibility of ceasing operations at the end of the year. In early 2025, the original owner, Randy Huffman, regained ownership of the mill, is continuing operations, and is working with American AgCredit to secure capital to invest in ensuring the long-term viability and success of the business. The 2025 financing and the mortgagee waiver agreement will allow Agwood to make essential capital investments, support ongoing operations, and position the company for long-term success.
Alternative Action/Motion:
Do not approve resolution and provide alternative direction to staff.
Strategic Plan Priority Designation: A Thriving Economy
Supervisorial District: District 1 , DISTRICT 2, DISTRICT 5
Vote Requirement: Majority
Fiscal Details:
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source of funding: Landlord and Mortgagee Waiver agreement does not change the repayment terms of the County's existing loan, it merely excepts the new out-building/facility from attachment by lien up to and until the lease agreement is paid off. |
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current f/y cost: EDFC currently handles loan servicing for Agwood’s loan with the County. EDFC’s contract for services is $900 annually. |
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budget clarification: Agwood loan monthly repayments fall under the UD schedule 9 budget. |
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annual recurring cost: EDFC currently handles loan servicing for Agwood’s loan with the County. EDFC’s contract for services is $900 annually. |
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budgeted in current f/y (if no, please describe): Yes |
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revenue agreement: N/A |
AGREEMENT/RESOLUTION/ORDINANCE APPROVED BY COUNTY COUNSEL: Yes
CEO Liaison: Executive Office
CEO Review: Yes
CEO Comments:
FOR COB USE ONLY
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Executed By: Deputy Clerk |
Final Status: Item Status |
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Date: Date Executed |
Executed Item Type: item |
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Number: |
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