Courtesy of Florida Times Union
Georgia-Pacific is going to spend $400 million expanding its paper and pulp mill in Palatka, adding an additional 80 jobs to a county with the highest unemployment in Northeast Florida. About 850 people work at the mill now.
Georgia-Pacific had announced in March that it would make the $400 million investment in one of its locations, but didn’t say which one. Locations were considered in at least three other states, said Terry Hadaway, public affairs manager for the plant.
At a Friday news conference in Palatka, the company made it official. It will add a new papermaking complex to make tissue and paper towels at its plant on County Road 216, a few miles northwest of Palatka.
Engineering and related work is expected to begin immediately, with the project finished and operating in 2019. In addition to the 80 new jobs at the mill, the number of construction and construction-related jobs is significant: An average of 160 a day throughout the length of the project, with a potential peak of 700 contract workers per day at the height of construction.
“Any job is significant,” said Brian Bergen, vice president of economic development for the Putnam County Chamber of Commerce. “But the real significance is that secures the future of the mill. As equipment ages, mills become less efficient.
“This was not considered a first-quartile mill,” he said, “but this brings it further back up the rankings.”
The plant was founded 70 years ago by Hudson Pulp and Paper, then purchased by Georgia-Pacific in 1979.
The subsidiary of Koch Industries is the largest private employer in Putnam County, a county of about 75,000. The total payroll for the mill is about $86 million a year, Hadaway said, and the career average for employees is in the upper-$50,000s.
The primary product at the mill is kraft paper, which can be used as brown butcher paper. But most of the paper the mill makes is for food containers, Hadaway said, particularly bags for sugar, flour, dog food, etc.
But it also makes Brawny and Sparkle brand paper towels, Angel Soft and Quilted Northern bathroom tissue, as well as private label brands.
The plant had as many as 1,200 employees five or six year ago, he said. But that number has been reduced through automation even as production has increased.
In May, the county’s unemployment rate was 4.9 percent, the highest in Northeast Florida and well above the state average of 4 percent.
“We actually have a difficult time finding people for the openings we have,” Hadaway said. “It’s the skills gap that you hear about. We need people with advanced manufacturing skills, people who can operate more with their minds than their backs.”
Many jobs that were done by hand are now done by machine, often run by computers.
“We still have people out on the floor, but instead of calling then ‘operators,’ we’re switching the term to ‘technician.’
“They have to know to read the data on the computer, but also operate the machinery, service it and make minor repairs.”
To that end, Georgia-Pacific is starting an advanced manufacturing academy in each of the three Putnam County high schools.
Brian Bergen, vice president of economic development for the Putnam County Chamber of Commerce, echoed what Hadaway said.
“The problem we have is that we have about 1,500 unemployed people in the county,” he said. “That’s the 4.9 percent. But there are currently 500 job openings. What that tells me is that we have a skills gap.
“If those jobs were filled, our unemployment would be below 3 percent.”
There are other positive signs in the county, he said. Florida Power and Light is building two solar farms there.
The city of Palatka has renewed focus on its downtown. New barbecue and Mexican restaurants have opened there this year, while Hampton Inn opened in April on the river.
When the new equipment is operating in two years, it will be making paper towels under the Brawny label and a large number of private labels for a variety of stores, Hadaway said.
Jobs there will likely be filled with people already working in the mill, he said, but that will create openings throughout the plant, particularly in the converting phase.
That’s where car-size rolls of tissue are turned into the small, double-ply rolls for sale in stores. New employees start there, he said.
The company will be receiving a rebate on the property taxes created by the expansion and equipment — 95 percent for the first three years and 80 percent for the two years after that.
In the past 10 years, Georgia-Pacific has invested $306 million in plant, and Hadaway said there’s potential for another $100 million in addition to the just-announced $400 million.
Roger Bull: (904) 359-4296