Big week for Rumford: Pending sale of paper mill, $990K CDBG grant, two Opportunity Zones
Courtesy / Catalyst Paper
Catalyst Paper, based in British Columbia, announced Friday it plans to sell its mill in Rumford and a mill in Wisconsin to a Chinese paper company for $175 million.
Friday was a big day for Rumford Town Manager Linda-Jean Briggs, who announced the town had won a $990,000 Community Development Block Grant on the same day that its largest taxpayer, Catalyst Paper, announced plans to sell its Rumford paper mill and a mill in Wisconsin to a Chinese paper company for $175 million.
Earlier in the week, Briggs also learned that two census tracts in Rumford will be included in the new federal Opportunity Zones program, created by the Republican tax bill passed last year, that gives investors a tax incentive for using capital gains from other investments and applying them to developments in the designated areas.
Gov. Paul LePage named 32 Maine communities on May 21 — out of 128 eligible tracts — to participate in the federal Opportunity Zones program. The Lewiston Sun Journal reported that one of the Rumford target areas includes the Catalyst Paper mill that’s being sold to a subsidiary of Nine Dragons Paper of Hong Kong.
“People who are sitting on investments because of capital gains tax can now, in those declared zones, free those up if they want to do expansion, renovation, whatever,” Briggs told the Sun Journal. “Those capital gains will not be taxed.”
Briggs told the newspaper that being a new program, the Opportunity Zones guidelines were pretty much wide open as to the opportunities to reinvest in the designated low-income census tracts. “Anybody who wants to locate a bottling plant here now has an opportunity to do so, if they want to free up some capital gains,” she said. “Or a manufacturing plant (or) any type of development, we have the space for it.”
Rumford mill to be sold
Catalyst Paper said Friday it reached an agreement with ND Paper LLC to sell paper mills in Rumford and in Biron, Wisc., as well as its U.S. operations center in Dayton, Ohio. Catalyst Paper President and CEO Ned Dwyer said the $175 million transaction is expected to close by the end of the second quarter, pending approval from Catalyst's shareholders, who will meet on June 11.
“We’re proud of what our employees have accomplished at our Biron and Rumford mills and our Dayton operations center. Their hard work and dedication have vastly improved these operations,” Dwyer said. “This transaction allows Catalyst to re-pay a significant portion of our debt and focus on our British Columbia operations.”
Catalyst, which is based in British Columbia, paid $74 million for the Rumford and Wisconsin mills, according to its October 2014 news release announcing its plans to acquire the mills from NewPage Corp.
“We continue to pursue opportunities to improve the competitiveness of our company and our industry,” said Dwyer. “We also continue to work with the provincial and federal governments in our defence against the unwarranted imposition of U.S. countervailing and anti-dumping duties.”
The Lewiston Sun Journal reported the Rumford mill employs 620 people.
CDBG grants to help downtown investments
In an April cover story by Mainebiz, Briggs characterized Rumford as a town with long-simmering potential that was beginning to bubble up.
She highlighted contractor Sargent Corp.’s $4 million infrastructure upgrade, much of it on the Island, the Victorian downtown core surrounded by the Androscoggin River, as well as replacement of a 125-year-old stormwater system, new sidewalks and the town’s plan to switch 600 street lights to more efficient LED bulbs.
Briggs said at that time the work will be paid for with the help of a $400,000 federal grant, a $2 million bond issue and, now, the Community Development Block Grant the town has been awarded.
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