Aug 152012

By Naomi Hatch
Area leaders met Aug. 9 to seek ways to mitigate the damage to the area’s economy and employment picture created by the recent announcement that Catalyst Paper would close its Snowflake paper mill.
The paper mill has been in the Snowflake and Heber/Overgaard area for the last 50 to 60 years, and has been a major component of the economy and commerce here, Navajo County Government Affairs Director Hunter Moore noted in presentations last week to the Industrial Development Authority (IDA) in Holbrook and the Real AZ Corridor in Snowflake.
The mill and its subsidiary, Apache Railway, employ 307 people full-time and expend an average of $80,000 for each individual for salary and employee related expenses. Moore also noted that one of the primary subsidiary businesses is Snowflake Biomass, which employees 180.
“There’s a lot still that is positive for the area, so we need to build on that, we need to move forward on that,” said Moore referring to the 4FRI project and potential potash mining.
A concern is the symbiotic relationship between the mill and the biomass plant, because the biomass plant uses sludge off the paper mill, with that byproduct providing 20 percent to 25 percent of all fuel burned at the biomass plant at little or no cost.
“That’s going to be a significant loss to the biomass plant,” said Moore, noting that Catalyst is intending to exercise a clause in the lease that states that it can give 180 days notice to terminate the lease.
“We know there are 400 direct jobs and the secondary jobs we can’t quantify at this time,” said Moore, not-ing the hospital among other businesses will see an impact.
“Tax revenues generate roughly $568,000 to different taxing districts,” he said, with the biggest shares go-ing to the Snowflake School District at $343,024.41 and Northland Pioneer College at $97,846.89 for the 2011 tax roll. “It will be an impact as we go forward.”
Referring to the outreach that State Senator Sylvia Allen (R-Snowflake) has done with all state leaders, in-cluding Governor Jan Brewer and the Arizona Commerce Authority, as well as the Congressional delegation, along with the local communities, and the media in all local and state level news publications, Moore said, “The big focus is what can we do and how can we go about doing that?” Noting they need a willing seller and a will-ing buyer, he continued, “They have to know what the price is to take any action by IDA. We’re trying to ex-plore if the IDA can be a major piece of the puzzle.”
Moore said that Snowflake Town Manager Paul Watson, Mayor Kelly Willis and council members, Taylor Town Manager Eric Duthie and Mayor Fay Hatch, and Supervisors J.R. DeSpain and David Tenney have worked with the media.
“We know there is a lot of awareness out there. It is well known throughout the state what’s going on,” he said. “I don’t believe that anybody believes that losing 400 jobs is a good thing.”
“The IDA is basically an authority on the IRS code that allows you to issue bonding that can be tax exempt or taxable bonding,” said Watson, “so really all they are is a conduit to allow another financing source to be made available.
“The meeting in the morning at Holbrook was a meeting of the minds, with everybody talking or working on ideas to keep the mill alive,” Watson continued. “We have a lot of key players in keeping this mill going. Everything I think that we can do, we are trying to do.”
Watson said there are buyers that they are working with, and those who have contact with the seller are working with them to make sure they are at the table.
“There’s an opportunity to salvage the mill and make it a better place than it is today,” said Watson, noting that recycle print is mostly newspaper quality print and the demand is decreasing dramatically, but, “the infra-structure is there; there’s a lot of things that make it viable.” He went on to say that IDA is willing to help with funding if it comes to fruition.
Keith Watkins, senior vice president of Business Attraction for the Arizona Commerce Authority (ACA) and Workforce Investment Authority (WIA), said that they are working with the Department of Economic Se-curity and the mill’s human resource department, rewriting job descriptions and getting peoples resumes up-dated, as well as working with potential buyers to try to help them complete the purchase.
“Commerce authorities are effectively resources of the public, so we’ve got to be stewards of the public dollars and make sure they go to projects that will carry them through,” said Watkins.
“We continue to try to be the facilitator.” He noted that ACA facilitators are out around the country every day, but they have put the word out that this asset is coming available quite quickly.
Allen reported that Senator Jon Kyl’s office responded and has attempted to contact Catalyst officials in Canada to encourage them to make every effort to sell and keep the mill going.