MONDAY 7/30/2018 1:30 p.m.
Three months ago, Local 5 featured Appleton Coated, now Midwest Paper Group, in a Web Exclusive (full story included below) breaking down exactly how the Fox Valley staple went from virtually claiming bankruptcy, fully re-opening, and planning for new hiring waves.
Monday, local and state leaders gathered upon the old mill to officially announce those plans.
Midwest Paper Group announced Monday afternoon a committed to creating up to 321 total jobs and investing $30 million in the former Appleton Coated mill.
The WEDC (Wisconsin Economic Development Corporation) is awarding Midwest Paper Group with up to $1.8 million in state income tax credits over a three-year period.
According to Governor Walker’s office, the actual amount of credits the company receives is contingent upon the number of jobs it creates during that time.
To receive the full amount of credits, Midwest Paper Group must create 321 jobs by 2020 and maintain them through at least 2022.
New Hope for an Old Mill: An American Comeback Story in the Paper Valley
By: Joshua Rose. May 1st, 2018
Last August, Appleton Coated filed a voluntary Chapter 128, a receivership, with the State of Wisconsin.
A receivership works similar to having a bankruptcy trustee without actually claiming bankruptcy.
All of Appleton Coated’s assets were signed over to court appointed Milwaukee attorney Michael Polsky and on September 19th Polsky put Appleton Coated’s assets up for auction.
The next day, Polsky shut down operations to avoid damaging any property or product.
Appleton Coated, one of the longest-running paper mill’s in the the valley, had been in the process of proactively putting resources into developing container board packaging grades, but couldn’t outrun the decline of the market.
Employment dwindled from over 600 on staff to about 40.
Head of Sales and Marketing John Mazuroski,
“We we’re down to a small crew to process, clean, sell and/or convert on-hand inventory. We also had to manage our remaining waste treatment and our raw, in some cases liquid, material usage.”
Overseeing inventory wasn’t the only reason for the skeleton crew, however,
“We needed to maintain the equipment in case a buyer came forward. This is typically referred to as a “Hot Idle”; we were focused on maintaining our facilities in preparation for a sale or a restart.”
In October, Industrial Assets and Maynards (IA&M) came forward and purchased nearly all the assets, (property, plant, and equipment) of Appleton Coated LLC.
Following the sale, the issue of who that skeleton crew would work for came forward.
As a result, IA&M entered into a 90-day labor agreement with Polsky and the United Steelworkers Union.
Staff would continue to work for and get paid by Appleton Coated, but per the agreement, take direction from Industrial Assets and Maynard.
Prior to the expiration of the short-term agreement, IA&M had the option to assess the future and renew the labor agreement for another 90 or move on.
Instead of just maintaining or selling-off inventory, the new owners decided to give a mini-restart a shot.
In December, a new 90-day labor deal was struck and a portion of production was restarted.
On December 11 one paper machine turned back on.
Then, March 5th a second.
March 26th…a third.
Employees slowly started coming back.
As staff grew, it came time for IA&M to make another big decision.
With the expiration of the second 90-days in March, Industrial Assets and Maynard penned a two-year labor agreement with USW.
Staff would now officially be employed by IA&M through its entity Midwest Paper Group, in effect officially ending the Appleton Coated era.
Not just a name-change, but a new owner with familiar operations and employees.
At the time of this story’s publishing 245 people are back to work; 200 union and 45 non-union. All 245 employees, save one, have been rehired from the original Appleton Coated layoffs.
John A. Corrigall, Head of People, Legal & Environmental Affairs,
“The restart is a testament to the new owners’ commitment to operating the mill along with a fair labor agreement with the USW.
Yet, most importantly, the restart is because of the return of dedicated past employees. This could not have happened without them, we wouldn’t have been able to train an entirely new staff.”
Most of those returning employees have 20+ years of experience in the industry.
Mazuroski light-heartedly cosigned,
“I received a letter from a company congratulating us on the restart…but telling me we took 20 of their new employees.”
Corrigall and Mazuroski both explained how the fight to persist came in the form of a symbolic reminder–many employees drive pass the old Kimberly mill site on their way to work daily.
The future is cautiously optimistic.
A new OCC Corrugator plant, which converts waste paper into pulp, will be completed and put into operation soon.
“I’m not sure if we’ll ever be back to 600 employees, but the progress we’re making in the restart has been encouraging”
Paper mills have long been the lifeblood of the Fox Valley. Full generations have raised their families in the production of pulp. Yet, more and more we hear of major facilities shutting down operations.
Rare stories like Appleton Coated, now Midwest Paper Group, catch the attention of the community.
Outagamie County Executive Tom Nelson,
“The company’s turnaround will be remembered as one of the biggest grassroots economic success stories in recent memory. In an industry racked with closures, bankruptcies and receiverships, one community fought back against the odds—and won.”
Today, nearly all the remnants of Appleton Coated have been bought with the exception of the Farm Guesthouse, which is still overseen by Polsky.
When asked how all this came to be, from an auction in September to Midwest Paper Group today, Corrigall and Mazuroski painted a bigger picture:
“The situation was a perfect storm of the right buyers and right parties.
For all these reasons, 245 people get to again provide for their families.”