By Tom Henderson • Staff Writer • 

Mill retools for cardboard, adding jobs

The company, based in Georgia, primarily churns out newsprint at the 125-year-old mill site. But it is converting one of its papermaking machines to brown kraft at a cost of $12.5 million.

CEO Allen Byrd said the company, which acquired the local mill in 1999, will remain one of the leading producers of newsprint in the western United States. But he said it sees opportunity in cardboard and is retooling to take advantage.

“This project reflects the strategy to grow our packaging business while remaining a preferred newsprint supplier in the West,” he said. “Newberg is a solid asset with great people. We are very excited about this expansion of our packaging business.”

Inclusion in a newly created enterprise zone, approved in April by Business Oregon officials, gives the company five years of property tax breaks on the new facilities, according to Assistant City Planner Jessica Nunley Pelz. She said that factor served as a powerful incentive.

 The exemption is expected to save SP Fiber about $913,000 over its five-year lifetime. The Newberg School District will have to absorb the lion’s share of the loss, but the city, county and community college district also figure to forgo significant chunks of revenue, the city share being pegged at $141,000.

In exchange, the company has agreed to:

n Add 20 new employees earning at least 50 percent more in wages and benefits than the Yamhill County average.

According to city documents, that would make the threshold for those pay and benefit packages $53,388. Current employees are averaging $65,000, so the provision is definitely workable, the company says.

n Hire new full-time employees and any independent contractors the company might need locally whenever feasible.

n Spend $1.4 million on a system to better control hydrogen chloride emissions from the burning of biomass, an element in the papermaking process.

n Spend $120,000 on three bioswales designed to capture and redirect untreated stormwater currently entering Hess Creek. The project figures to divert about eight million gallons of runoff from an eight-acre portion of the site into the mill’s wastewater treatment system.

The affected portion of the site includes the employee parking lot, a major source of runoff.

Interim Planning and Building Director Steve Olson said the mill expansion is serving as something of a pilot project for Newberg, which has never had an enterprise zone.

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