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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.

"The cooperative ownership is really what makes the system work," said Keith Hesterberg, president/CEO of the Fresno Madera Farm Credit, an association in Fresno. The borrowers have a vested interest in making sure their association is well run.

A common theme for the associations is relationships.

"They're like old-style banks," said Steven Slezak, an agribusiness instructor at Cal Poly San Luis Obispo. "They know their customers. They've worked with their customers for generation after generation."

The associations typically have staff with deep backgrounds in agriculture who can offer expertise in the best ways to use new capital to improve farming operations.

"They have a competitive advantage in that area," said Xiaowei Cai, an assistant professor in agriculture at Cal Poly.

When Carli left Santa Rosa High in the late 1970s and joined the Federal Land Bank Association of Santa Rosa, there were still about 1,000 such associations in the U.S. — some strictly for long-term financing of land, equipment and buildings, while others did just short-term credit for operations.

At that time, the two credit organizations in Santa Rosa together held about $100 million in loans, said Terry Lindley, American AgCredit's chief marketing officer. Lindley had started at the North Bay Production Credit Association here a few years before Carli came to the land bank.

Carli became manager of the land bank in 1982 and four years later manager when the two farm organizations merged to form North Coast Farm Credit Services. Further mergers created Pacific Coast Farm Credit and in 2001, American AgCredit.

The association benefited from what Carli called California's dynamic rebound after the nation's agriculture sector suffered a severe downturn in the 1980s. Others noted that the association also prospered by lending heavily to wine grape growers and wineries, a sector that rose to become the county's top agricultural product.

But American AgCredit's board and management also gained a reputation for aggressively seeking out new business.

The association made headlines in 1996 by putting together the lenders for an estimated $350 million purchase of Nestle's Wine World Estates, which included such widely known wineries as Beringer and Chateau Souverain.

The association's assets then totaled $550 million and its maximum loan was capped at $12 million. But it was able to arrange the massive deal because a few years earlier it had formed one of the first teams in a farm credit association for originating and selling loans too large to keep entirely in its own portfolio.

Since 2000 American AgCredit has completed five acquisitions. But one stands out as a first.

"We kind of broke the mold back in 2007 when we went to Kansas," Carli recalled.

No farm credit association had ever gone so far from its home turf to acquire another association, Carli said. American AgCredit "took some heat" from within the system and "significant resistance" from federal regulators, but the merger with Farm Credit of the Heartland was completed in 2009.

Slezak, the Cal Poly instructor, said the association's officials saw that the next step in growth involved moving outside state boundaries and adopting a regional strategy.

"They were visionary in many ways," he said.

To run the operation in Kansas, American Ag Credit brought in Byron Enix, an Oklahoma State University grad who has worked in farm credit since 1984. Last year Enix was promoted to the number two position in the association, chief operating officer.

Today the association has branches in California, Nevada, Colorado, New Mexico, Kansas and Oklahoma.

Growth isn't coming just through mergers. For 2012, loan volume from the association's existing operations increased 6.7 percent. For the past 12 months, Carli said, that organic growth amounted to about $500 million in new loans, more than the loan portfolios of a quarter of the nation's approximately 80 existing farm credit associations.

For seven years the association has been able to give a dividend rebate to borrowers. For the last two years it has amounted to 1 percent of the interest paid on loans — a record $45 million last year.

Jim Young, CEO at Robert Young Vineyards and Winery, said American AgCredit usually offers lending rates that are quite competitive with banks. But with the rebates, "they're way ahead."

"They're not trying to make a profit off of you," Young said as to why his family does business with the association. "They're doing it for our benefit."

Mark Sanchietti, a grape grower outside Santa Rosa, said the association's leaders know farmers. Last year Sanchietti attended one of the Harvest Fair award gatherings where Carli said a few words to the audience of about 75 people.

"He could name every person that was there," Sanchietti recalled.

Sanchietti, 29, owns, leases or manages 300 acres of grapes. He got his first loan to start his business from the association six years ago.

There was little doubt where he would turn for help. His father Mel was a director years ago for the association. His mother Janeen had worked there as a loan officer.

His wife Jenny did a summer internship for American AgCredit. And the association bought Sanchietti's lamb at the county fair when he was a 4-H member.

"I've known them my entire life," he said of Carli and his staff. "They've known me my entire life."

The association has invited four groups to lease space at its future headquarters: the Sonoma County Vintners, Sonoma County Winegrape Commission, Sonoma County Farm Bureau and Sonoma County Tourism.

Representatives for all four groups said they are considering the offer. Some said they see value for their members in gathering farm groups in one location.

A few also noted that American AgCredit last year had considered moving to Denver, eventually deciding to stay put here. They suggested filling up the office complex benefits not only the association but also the local economy.

Said Ken Fischang, CEO of the tourism group, "We are all about doing whatever we can to keep companies like American AgCredit staying in Sonoma County."