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Braving Tuesday’s nor’easter to attend CEI’s annual meeting in Brunswick, St. Croix Tissue Inc., was awarded CEI’s “2017 Award for Expanding Economic Opportunity” for its $120 million paper mill that has created more than 80 jobs.
It’s just the type of project in which CEI Capital Management CEO Charlie Spies III said he likes to invest. CEI, a nonprofit, is for-profit CCML’s parent. Both are based in Brunswick.
“We work with New Markets Tax Credit transactions and have more than $990 million in investment authorization since we started them,” he said, adding that CCML operates nationally, but Maine has received $274 million of those NMTC funds in 22 projects that preserved more than 1,700 jobs in distressed communities in Maine.
The federal NMTC program stimulates investment and economic growth in low-income communities that are typically overlooked by conventional investors. The program attracts investors to low-income areas by offering a 39% federal income tax credit over a seven-year investment period. The tax credits are allocated by Community Development Entities like CCML.
The financial team behind the project, which has two tissue machines at its Baileyville mill near the New Brunswick, Canada, border,, includes St. Croix parent International Grand Investment Corp., CCML, US Bank, Enhanced Capital, Wells Fargo and the Finance Authority of Maine.
CEI’s workforce group, along with Washington County Community College, provided training in tissue-making for the 80 employees in the mill. The St. Croix mill is an expansion of related company Woodland Pulp LLC’s pulp mill in Baileyville. The first of two tissue machines was started on March 4, 2016, in the St. Croix mill and the second on July 29, 2016.
Part of the financing agreement was that St. Croix Tissue would hire 60% of its new employees from low-income households.
“That meant 48 of the new, well-paying jobs would go to low-income people,” Spies said. “Think of the shot in the arm that was to Washington County.” To date, the new mill has hired 84 people.
One of them is Marco L’Italien, vice president of IGIC, a native Mainer who worked at Lincoln Paper & Tissue, one of the six mills that went under in the past few years.
“So I went to the St. Croix mill and was able to stay in Maine,” said L’Italien, who grew up in Lincoln.
St. Croix mill manager Marty Richard said the NMTC and CEI’s partnership were key to getting the mill restarted in Maine, as parent IGIC was looking at other sites both within and outside of the United States.
“It was our first major funding for the project,” Richard told the annual meeting attendees. “The NMTC money was a critical factor to locating the project in Maine and the CEI partnership was the catalyst for the training funds.”
Richard said the investments preserved more than 300 jobs at Woodland, added more than 80 jobs at St. Croix, and created more than 300 indirect jobs in the community.
St. Croix was founded in Baileyville in 1904 to provide newsprint to the Boston Globe. It added two paper machines and two hydroelectric generation stations from 1906 to 1915. In 1963 Georgia-Pacific bought it and it was resold again in 2001 to Canadian paper company Domtar, which closed it in 2007, ending 100 years of papermaking. IGIC, a U.S.-based company for a Chinese investment firm, bought the mill in 2010, installed a natural gas pipeline and converted the mill to natural gas in 2011. The expansion in Baileyville makes paper towels, facial and other tissues.
Its products are sold retail under the Fiora brand to Hannaford, Shaw’s and IGA. Higher-end versions are sold under the Livi brand to Cabelas, Harvard University and the Rockefeller Center. It’s also sold private label to Walgreens, Sav-A-Lot and others, and it’s sold commercially to hotels and commercial buildings. The largest retail customer is Oasis Brands of Virginia.
Getting the mill restarted — a project that started in 2014 — was no small feat. Nicknamed “Project Black Bear,” it required 1 million construction hours, which Richard said equals a full career for 15 to 17 people. At its peak, 535 contractors were on site. St. Croix was spending more than $300,000 a day for contract labor, and in total paid out more than $100 million to Maine construction contractors.
As for weather, the mill was constructed during the fierce winter of 2015. When it came time to put on the stacks, there was too much snow to use equipment on the ground.
“We had to hire a helicopter and install them from the air,” Richard said.
The full annual meeting can be viewed on CEI’s website.
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Work for ME is a workforce development tool to help Maine’s employers target Maine’s emerging workforce. Work for ME highlights each industry, its impact on Maine’s economy, the jobs available to entry-level workers, the training and education needed to get a career started.
Few people are adequately prepared for all the tasks involved in planning and providing care for aging family members. SeniorSmart provides an essential road map for navigating the process. This resource guide explores the myriad of care options and offers essential information on topics ranging from self-care to legal and financial preparedness.
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