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Pikuni Industries keeps expanding

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BROWNING, Mont. - Pikuni Industries Inc., a Blackfeet tribal enterprise, is gearing up to become a major supplier of modular homes in Indian country and beyond.

"Basically, we decided that just making a frame wasn't enough," says general manager Ed Aubert of the shift from being a metal fabrication plant. "We're pretty much ready to go."

Bolstered with a $600,000 federal Housing and Urban Development grant last year and another $500,000 HUD grant this spring, the transformation from steel-frame producer to rolling out finished homes is nearly complete.

The first home is expected to be finished in coming weeks and it is hoped the plant can produce up to 25 by the end of the year.

The 1999 grant through HUD's Rural Housing and Economic Development Program enabled the company to cover many of its start-up costs, renovate an existing 40,000-square-foot building, shore up design work, draw up a marketing plan, and buy the first materials. The latest funding, leveraged with a $2.5 million match, will allow the firm to begin full-scale production, Aubert says.

The company's basic home will contain about 1,248 square feet of space, and include three bedrooms. Projected costs will run about $50 to $55 a square foot, putting the total retail price at about $66,000.

The homes are designed for northern climes built to handle high winds and heavy snow loads. Other designs, including some that can be custom-made to a buyer's preferences, will be introduced later, he says.

Instead of wood, dwelling frames will be nearly all metal, screwed instead of nailed together. Much of the steel comes from recycled material.

"It's just metal studs instead of wood studs," Aubert says, adding that purchase of a specialized stud mill may be in the works. "I think steel is going to be cheaper than wood in the future, and it certainly holds up better. Modular homes are as good, and in some ways better than (traditional) homes built at the site."

The plant employs about 14 people most of whom make between $8 and $11 an hour, Aubert says, but as production grows, up to 30 more people could be needed.

The company will hire up to 40 more people to complete a 26,000-square-foot assisted living center for the tribe. That project, expected to be completed on the north end of Browning in early 2001, is being financed through a separate $2.4 million HUD grant.

Officials at Pikuni Industries figure that, at top speed, one house can be completed in a week at the new factory. In all, up to four houses will be on the assembly line at one time. In 2001, the company hopes to roll out at least 50 homes, operating year-round.

"I think that's fairly realistic," Aubert says. "We're on schedule with the grant. I think it's a very ambitious project. Our goals fit with HUD's goals, which are to create jobs and provide affordable housing."

The company is considering producing its own doors, cabinets and windows, painting components, and doing all the electrical, insulating and plumbing work. Other possible spin-offs could include site preparation, installing water and sewer hook-ups and landscaping lots, he says. The houses will come off the line in halves, so there's also a market for hauling and setting up the homes.

"If you bundle it all together and finance it together, it works better," Aubert contends. "We may include the whole works."

Aubert, former long-time planning director for the tribe, and other plant officials want to eventually set up an apprentice program so new workers learn the production trade from experienced craftsmen and move up the ladder.

The company is working with Blackfeet Community College and the Montana Department of Labor and Industry to prepare workers, he says.

In addition, Aubert says Pikuni Industries, 100 percent tribally owned, plans to be a "one-stop shop" for clients by providing home financing, as well as the finished product. By setting up a revolving loan program with a shot of seed money, Aubert and finance and development director Jeanne Baker say a $20 million to 30 million fund could be built over time.

"We're going to have enough financing to sell as many houses as we can produce," says marketing and sales director Don Kittson. "We think we have a good idea here. We intend not only to teach (clients about home financing,) but we'll help them get the money, too."

Aubert, who also holds a real estate license, notes that nearly 1,000 people are on a waiting list for housing on the Blackfeet Indian Reservation alone and the company hopes to expands sales throughout the region. The first target will be Montana's six other reservations, Baker says, then the other tribes in HUD's Region 8.

"We're diverse," she says. "We know the tribal system. We know how to deal with the reservations. We're at a point where we really want to see our company create jobs."

Aubert said all profits will go back into expanding production. Another part of the plan is to develop a model community on the Blackfeet Reservation, where up to 20 new modular homes could be situated, all organized under a homeowners' association.

In the past, Aubert said HUD merely built homes for Indian people and residents had little or no say about what they wanted. Now the agency is putting more focus on individual ownership, as well as choice.

"HUD, I think, is on the right track," he says, adding that modular homes are becoming more popular everywhere as the cost of traditional homes stretches beyond the reach of many consumers.

"That gives us a fairly good position in a potentially growing market," Aubert says.