3M will spend $468 million over the next three years to expand its health care manufacturing facility in Brookings, S.D.
3M commits to $468M expansion of health care manufacturing site in South Dakota
Company reinvests in facility it has operated for more than 50 years.
July 17, 2023 at 8:35PM
Tim Reed, CEO of the Brookings Economic Development Corp., said the commitment to expand the plant has people relieved. When 3M a year ago announced plans to spin off its $8.6 billion health care business, some wondered about the future of the plant.
"People realize that this plant is here to stay. We know that they're going to stay in the community," Reed said.
3M said in April that the health care division is on track to become a separate company by the end of the year. The remaining 3M will have a 20% stake in the new company.
In Brookings, 3M and city officials have been talking about expansion plans for more than a year.
This year, the company will spend $158 million to add 16 shipping docks, an 8,000-slot warehouse, 200,000 square feet of manufacturing space and lab and office space, according to news releases on the project.
Reed said 3M is the third-largest employer in Brookings behind South Dakota State University and Daktronics which makes scoreboards, LED video displays and digital billboards.
3M is in talks with the city and state to receive incentives, including tax increment financing and a rebate on city taxes paid for materials and equipment. Reed said that the total value of those incentives has not yet been determined.
Brookings Mayor Oepke Niemeyer said 3M has been a "valued member of the community," which is why the city near the border of southwest Minnesota is considering the incentives. It employs more than 1,000 workers.
"It's not uncommon for 3M Brookings employees to spend their entire career at the Brookings plant and retire with more than 40 years of service," he said. "These employees contribute to the economic engine and overall well-being of Brookings and our surrounding towns. They are our family, friends and neighbors, and they benefit our communities in countless ways."
The Brookings complex is 3M's first and largest health care manufacturing site. The company broke ground on the facility in 1969 and began production there in 1971. It has been expanded several times, with the most recent addition completed in 2016, and is now 667,000 square feet.
It makes products from surgical tapes, drapes and dressings to medical and food safety projects, according to 3M.
The health care division produced one-quarter of 3M's revenue last year.
Health care spending rose by 15%, driven by higher prices. Officials say solutions are needed to prevent Minnesotans from being priced out or delaying care they need.
