PAPER’S NEW ERA

More convincing evidence that the era of large paper mills is ending in Maine came Thursday with the news that the Georgia-Pacific mill in Old Town is closing, we hope temporarily. State officials are optimistic that a buyer can be found for the facility. A smaller, specialized mill is the most likely outcome.

Gov. John Baldacci is to be commended for working so hard to save paper mill jobs here; the G-P mill makes the fifth since the eve of his inauguration, including the Old Town one once before. In each case, however, the number of jobs was much smaller at the re-started mill. That trend will continue as the state and G-P look for a buyer for the Old Town mill and International Paper Co. continues its search for a buyer of its mills in Bucksport and Jay. Earlier this week it was reported that NewPage Corp., a small paper company based in Ohio, is interested in buying IP’s Maine mills.

The governor and the state took huge steps to lower energy and operating costs at the Old Town mill, which employs 400 people. When G-P threatened to close the mill in 2003, the state bought its landfill and the company used the money to buy a biomass boiler to lower its energy costs. It wasn’t enough and corporate officials announced Thursday that they would close the mill. The state and G-P officials will work together for 60 days to find a buyer. Gov. Baldacci said he was confident the state would find a buyer in that time. Five groups have expressed interest.

Simply because the Old Town mill no longer fits with the Georgia-Pacific corporate strategy does not mean it is no longer a viable mill. G-P decided to close the mill because it no longer made sense to make large paper rolls there only to move them to another facility to be converted into consumer products such as toilet tissue and paper towels, a G-P spokesman said. With the pressure to fit into a global company making numerous products removed, the mill can be successful.

The most likely scenario is for a small company that makes a niche product to buy the facility. A successful model of this type of mill is just up the river in Lincoln. The installation of a new paper machine at the Lincoln Tissue & Paper Co. is the first major upgrade at a Maine mill in 15 years, showing that specialized mills can be successful.

While a paper mill is likely to remain operational in Old Town, the trend is clear. No matter how many innovative deals the governor and his team can negotiate, no matter how many incentives they offer companies, the number of paper mill jobs in Maine is fast declining. This is not a surprise to industry analysts nor is it unique to Maine, but it is a hard lesson for places that depend heavily on mills.

While the governor naturally wants to save every job he can, creating new jobs in new and growing industries will pay much bigger dividends long term.