IP’s CEO promises transition help

Published 10:37 pm Friday, November 6, 2009

International Paper Co. “did not arrive lightly” at the decision to close its Franklin mill, the company’s chairman and chief executive officer said in a letter to five congressmen who had requested more information about the mill’s closure.

Last week, U.S. Sens. Mark Warner, D-Va., Jim Webb, D-Va., and Kay Hagan, D-N.C., and U.S. Reps. J. Randy Forbes, R-Va., and Robert “Bobby” Scott, D-Va., all signed a letter that asked IP CEO John Faraci and the company to consider the effects of the mill’s closure on the region and that suggested the company postpone closure for a year.

In his letter of response, Faraci blamed the closure on the gradual decline in demand for uncoated freesheet or copy paper, Franklin’s main product. The market, he said, has been decreasing gradually since 1997, but the economic recession caused the pace of the decline to accelerate rapidly, leading to the decision to close the mill.

“Most of the facility will remain in place post-closure, although a significant number of parts and equipment will be transferred to other IP facilities,” Faraci wrote.

Faraci said the company would be open to discussions regarding future uses for the site and is committed to working with state officials to “mitigate significant negative economic effects,” but any future uses that include papermaking would be “unsustainable.”

While Faraci didn’t agree to a meeting as lawmakers requested, they were still encouraged that the company seems to be willing to help families that will be affected by the mill’s closure.

“We’re pleased that IP has pledged to work with us to minimize the economic trauma for these families, and IP promises to work in partnership with the community to maximize the economic development potential of the site,” said Kevin Hall, a spokesman for Warner.

“In the coming months, we will be heavily engaged in efforts to lessen the impact of the transition,” Faraci wrote, noting that the mill employees’ performance has been “exemplary for many years.”

Warner and Webb have already begun taking additional steps to help the area recover from the mill’s impending closure. The two joined forces to send a letter to U.S. Secretary of Transportation Ray LaHood, asking him to consider the impact of the mill’s closure as he reviews a grant application submitted by the city of Suffolk to make improvements to Route 58 as part of the “U.S. 58-Hampton Roads Intermodal Corridor.”

Suffolk applied for a competitive grant under the Transportation Investment Generating Economic Recovery program to help support the development of an intermodal warehouse and distribution park.

“This project has the potential to generate thousands of new jobs for the people of Suffolk, Franklin, Southampton and Isle of Wight, providing much-needed economic opportunities to those negatively impacted by the closure of the International Paper plant,” the letter states.

“There’s no better use of one of these grants, given the situation at IP,” said Webb spokeswoman Jessica Smith.