Skilled Worker Shortage
Workers at the new St Croix tissue plant The New Markets Tax Credit helped finance job creation and workforce training there Woodland Pulp

Workers at the new St. Croix tissue plant. The New Markets Tax Credit helped finance job creation and workforce training there.

Making the New Markets Tax Credit Work in Maine

How the Woodland Pulp company used funds for economically distressed areas to finance a plant expansion and workforce training.

In 2010, when the new owners of Woodland Pulp elected to vertically integrate operations and build a companion tissue plant on site, the endeavor faced multiple hurdles. The contemporary papermaking industry, once a mainstay of Maine’s economic engine, had shrunk dramatically in response to global market trends. The costs of updating and integrating a legacy paper mill required an investment of over $120 million. Meanwhile, the local and skilled workforce to run the new operation was limited. The need to recruit ambitious and capable employees, as well as secure affordable and flexible capital, was critical.

We found a formula to finance the plant conversion and simultaneously recruit and train the workforce essential for its success: New Markets Tax Credit financing.

In order to qualify for the federal New Markets Tax Credit program, a project must provide an economic benefit to those in an economically distressed census track. That is the case for us in Baileyville, Maine, where the plant has been operating since 1905. The upgrade and expansion of the mill helps preserve about 320 existing jobs at Woodland Pulp, and the operation at the new St. Croix Tissue plant is expected to create 80 new positions.

These are quality jobs in an area so economically distressed that some of our employees drive up to two hours to get to work.

We’ve found there are long-term benefits to hiring locally, particularly in maintaining a stable work force. But because of our rural character, it’s been a struggle to recruit, train, and retain employees who are not originally from the area. The small-town setting can be quite a culture shock for those who relocate. It is disappointing to invest in developing staff for two or three years, only to watch them leave. 

Part of our confidence in retrofitting the mill with state-of-the-art equipment was an additional investment in training a local workforce. While the skilled worker shortage is a national problem, it is particularly acute where we live and work. We were able to work with CEI Capital Management, a non-profit community development corporation that administers New Markets funds, to add a community benefits agreement to our financing. The agreement enabled the funding of a multi-year workforce training program for the mill, as well as for other businesses in the region.

With leadership from CEI Workforce Development professionals, we collaborated with a variety of public and private entities—including our local community college and state department of labor—to support the training of hundreds of individuals preparing for employment.

The positions for multiple shifts at the two plants require skills that are specialized and varied. New technology comes with new safety measures. New hires need to understand the metric system, advanced math and materials process flow calculations. New equipment operators need to understand logic and automated process controls systems.

The more traditional roles remain as well: the pulp mill will continue to require skilled operators, qualified, general maintenance mechanics as well as electrical and instrumentation technicians.

Our workforce also requires certain often-overlooked soft skills, ranging from teamwork and clear communications to workplace-appropriate appearance and behavior. To help potential employees develop these skills, we supported the implementation of the Maine WorkReady “soft skills” training program and initiation of the ACT National Career Readiness Certificate training system, the first of its kind in Maine. These credentials are awarded to individuals who attain the occupational competencies preferred by local businesses and are endorsed by professional associations across the country.

Of the 38 students who took part in the original training course at the local Washington County Community College to learn about paper-making technology, 17 were hired. An additional 41 individuals were subsequently hired by St. Croix Tissue. In September 2015, all 58 new hires began a 20-week, fully paid High Performance training program hosted by Washington County Community College and delivered in standardized skill blocks, which instilled a uniform set of pre-operational vocational competencies among all workers.

This collaboration has allowed us to build an infrastructure for training recruits who want to remain in the area for the long haul, raising families here and developing their careers at the mill.

Importantly for the community and for meeting the purpose of the New Markets Tax Credit program, mill positions pay hourly wages and salaries above the average in the region. Opportunities for advancement will be par for the course as the company and its workforce matures.

Job opportunities locally over the last two years aren’t limited to the addition of the estimated 80 new positions at the St. Croix Tissue plant. Because of our staffing, we estimate that hundreds of indirect jobs will open up in the area at restaurants, gas stations and many other local businesses. We’ve already seen an increase in job creation and job security throughout the supply chain for the tuckers who transport our product from point A to point B, and to the employees of local construction companies who have assisted in the project’s building and machine erection.

As a whole, we recognize that successful workforce recruitment, training and retention is only possible with a collaboration beyond our four walls. The addition of St. Croix Tissue has brought many opportunities to our region, and we are committed to building upon existing and new partnerships for our collective sustainability.

Jim Oliver is controller for Woodland Pulp ND St. Croix Tissue. Paul Scalzone is director of workforce solutions for Coastal Enterprises, Inc. (CEI).

 

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