In his early days in farm lending, Ron Carli helped a customer borrow $500,000.
Three decades later, the same customer obtained a $50 million loan from American AgCredit, the Santa Rosa-based farm cooperative that Carli heads.
For Carli, a Cotati farm boy who switched from teaching high school ag classes to financing dairies and vineyards, that example helps explain why American AgCredit transformed itself from a small farm credit association to Sonoma County's largest financial institution.
Agriculture operations across the nation grew in scale and required far more capital. The local associations that belong to the federally-sponsored farm credit system had to grow or be left behind.
"The system had to change," said Carli, president and chief executive officer.
American AgCredit exists to help farmers grow their businesses. But few agriculture operations have grown faster than the nonprofit that is now the nation's sixth-largest farm credit association.
With $6 billion in assets and 422 employees — including about 110 in Santa Rosa — the association has been on a blazing growth spurt for more than two decades.
Much of its growth came through mergers and acquisitions, including one four years ago that was unprecedented for linking up farm credit associations in two different regions of the country: Kansas and California.
American AgCredit, which now has 33 branches in six states, is preparing for even more growth. The best evidence is its plan to build a new 120,000-square-foot headquarters next year off Airport Boulevard, a complex that might house other wine, farm and tourism groups in a one-stop agricultural center.
The three-story project, proposed across Aviation Boulevard from the Airport Stadium 12 cinemas, is slated this week to go before the county's design review board.
If the association's board of directors gives its blessing, the new complex could be built by late 2015, officials said. They declined to divulge the estimated cost.
Local farm leaders give American AgCredit high marks for its widespread support of local fairs, farm youth groups, agriculture events for school children, college ag programs and all sorts of farm organizations.
In a similar manner, farmers said the association's success is largely due to the long-standing relationships that its staff have forged with the farm community — connections that have been tested over the decades.
"Our lending partners have stuck with us through thick and thin," said Arnie Riebli, an owner of Petaluma-based Sunrise Farms, the largest egg farm in Sonoma County. "That's a big reason why we continue to do business with them."
Riebli said he has borrowed from the association under its different names for close to 50 years.
The Farm Credit System is a government-sponsored enterprise, born of President Theodore Roosevelt's Country Life Commission and established by Congress in 1916. As with Fannie Mae and Freddie Mac for housing, the farm system seeks to ensure the availability of credit for a critical part of the nation's economy.
What makes the farm system different is that the farmers who borrow money are the very same stockholders who elect the board of directors that oversees their association's management.
For example, American AgCredit is owned by roughly 7,000 shareholders, each a borrower who purchased a single share of stock for $1,000. In that sense, the association's power structure is akin to a credit union.