VALPARAISO | Plans by Pratt Industries to build a $260 million, 250,000-square-foot paper recycling plant next to its cardboard box plant were announced Tuesday by company officials and Valparaiso Mayor Jon Costas.
"Approximately nine months ago, Pratt executives approached us about the possibility of constructing the proposed recycled paper plant in Valparaiso," Costas said at a gathering of state, county, city and company officials at City Hall.
"Such a large project involves varied and often complicated issues such as land acquisition, utility service, water usage, investment incentives and financing," he said. "Both parties brought a collaborative win/win approach to the negotiations, and it soon became evident Valparaiso was the clear choice for this project."
Pratt owner and chairman Anthony Pratt said the company considered about 100 possible locations, eventually narrowing it down to two in Indiana and one in Ohio.
The new plant will be built on 25 acres Pratt owns adjacent to the existing 500,000-square-foot box plant, built in 2000 at 3155 Ind. 49 just south of U.S. 30. The company is buying an additional 30 acres to the east, which it will annex to the city.
"This new facility will allow us to better service the needs of our expanding customer base not only in the Midwest but throughout the United States," Pratt said. "Indiana is a perfect fit for us. We've been a part of the business community here for many years now, and we know there is a skilled, reliable workforce available to us."
To close the deal, the Indiana Economic Development Corporation is offering $1.2 million in conditional tax credits and $200,000 in training grants. The tax credits will be applied based on the company's hiring Hoosiers. Pratt employs 320 people, and the new facility is expected to add 137 jobs by 2018.
The Northwest Indiana Regional Development Authority is adding another $1.4 million, which can be spent on capital improvements and infrastructure, from its deal closing fund, Executive Director Bill Hanna said.
NIPSCO is offering an estimated $15 million in energy and infrastructure incentives, and the city is sponsoring $200 million in tax-free industrial revenue bonds to help finance the project.
City Utility Director Steve Poulos said the plant, which will take in waste paper from all over the country to be recycled for use in the corrugated box plant, will require about a million gallons of water a day and generate up to 700,000 gallons of sewage a day.
Poulos said the city has enough water available to serve the new plant, and he will be reporting to the City Council on Monday on how the utility plans to meet the city's water needs in the future. The sewage equals about 15 percent of the treatment plant's current average daily flow.
"Pratt's decision to build an expansive paper recycling plant is, we believe, the single largest private taxpaying investment in the history of the city," Costas said. "This level of investment will have positive residual benefits that will continue to expand our regional economy."
Pratt still must go through the approval process for the project, but Costas predicted it would be accomplished quickly in order to meet the company's goal of breaking ground in March. Pratt said he expects to begin producing recycled paper for the box plant in July 2015.
The Conyers, Ga.-headquartered company expects to produce 360,000 tons of recycled paper a year once the plant is fully operational.
The project will include a wastewater pre-treatment facility and road improvements. The Valparaiso plant plans to begin hiring paper machine operators, equipment operators, electrical and instrumentation technicians, shipping representatives, waste yard personnel, shift supervisors and maintenance associates late next year.