Deficit threatens commercial kitchen

Three times a month, Peggy Alderman whips up batches of huckleberry-ginger salad dressing at the Bonner Business Center’s kitchen.

It has everything she needs – from bottling equipment to a federal license for commercial food preparation.

“It’s a nice facility,” said Alderman, co-owner of the Coeur d’Alene Dressing Co. “We’d hate to see it close.”

The kitchen is so popular that small gourmet producers drive from Missoula and Boise to rent it by the hour, turning out everything from barbecue sauce and raspberry jam to hot pickled peppers. But the 12-year-old facility – located by the Sandpoint Airport – is losing thousands of dollars each year, and its future is uncertain.

Last month, the city of Sandpoint sent letters to the 16 firms that use the kitchen. If the city can’t find ways to stem the loss, it will eventually close, the letters said.

“It’s a wonderful facility, and we hope we can keep it open,” City Attorney Will Herrington said Wednesday. “But the City Council is not willing to subsidize it with taxpayer dollars.”

According to Herrington, the kitchen needs revenues of $25,000 to $30,000 per year to break even. The kitchen brought in less than $12,000 last year.

Compounding the problem, the Bonner Business Center itself is running a deficit this year, Herrington said. The business incubator provides space and professional assistance to start-up firms.

“If the incubator were making money, it could subsidize the kitchen,” he said.

Gem Berry Products has used the kitchen since 1992, the year it opened.

Co-owner Jack O’Brien’s late wife needed a commercially licensed kitchen to make fruitcakes for sale. From fruitcakes, the couple expanded into jams and huckleberry products.

This year, Gem Berry bought out Lite House Dressing’s huckleberry line. The company uses the kitchen three times per week, paying rent of $9.25 per hour. O’Brien said he’d have to close if the kitchen did.

“None of us have the money to go out and build a kitchen like this,” he said.

Herrington approached the 16 producers that use the kitchen about running it themselves and paying fees to the city.

“I don’t know of anybody that can take that on,” said Alderman, the co-owner of Coeur d’Alene Dressing Co. “We already work 40 hours a week.”

Raising the hourly rent met with mixed reactions.

O’Brien said his product prices haven’t increased in four years. Gourmet food producers work on thin margins, he said. “I couldn’t afford to pay more.”

The next closest commercial kitchen is Spokane, at the Spokane International Airport’s business park. It charges $12 per hour, though rates drop if users sign up for a set number of hours per month.

Sandpoint’s commercial kitchen has attracted international visitors since it opened in 1992. Economic development specialists tour it to get ideas.

O’Brien said the kitchen has lived up to its goal of providing micro-economic stimulus to the community. Every summer, Gem Berry buys $20,000 to $40,000 worth of huckleberries from local pickers. The firms that use the kitchen employ a total of 35 people.

The city has promised not the close the kitchen before the Christmas holidays, which is a heavy production time for specialty food producers, Herrington said. If the city ends up closing the kitchen, it will give the producers a three-month notice, so they can make other plans, he said.

Alderman hopes there’s still time to save the kitchen. More users would certainly help, she said.

The Coeur d’Alene Dressing Co. started with a family recipe, and grew into firm with sales in 22 states.

“There are a lot of people out there who have a favorite recipe they’ve always wanted to do something with it,” she said.