Historic Oregon paper mill demolished, redevelopment planned

PORTLAND, Ore. (From news reports) -- Demolition of Newberg's historic paper mill has begun.

Millions of pounds of steel, aluminum and other metals will be harvested from the site and sold as scrap as the company that purchased the facility begins the monumental task of disassembling the mill and freeing up the land for development.

Commercial Development Co. Inc., the St. Louis, Missouri-based company that purchased the mill from WestRock, began auctioning off heavy equipment, steam-generating machinery and other items last fall.

Demolition of the mill will continue until the site is cleared, then a subsidiary of the company will begin what is expected to be a heavy environmental cleanup before the land can be developed for alternative uses.

The January commencement of scrapping the mill is the last chapter in its long history, which began in the 1880s when it was the site of Spaulding Lumber.

The facility transitioned into a paper mill roughly 80 years ago and has seen a long list of owners during that time, including Publishers Paper, Jefferson Smurfit, SP Fiber Tech and others. WestRock was the last owner to operate the mill, although not for long as it shuttered the facility and fired more than 220 workers a few months after purchasing it in 2015.

The mill, one of Yamhill County's primary economic engines and long a major component of Newberg life that annually converted more than 330,000 tons of recycled paper into newsprint and lightweight container board, has set idle ever since.

"Those mill jobs paid $28 an hour plus benefits, and they're the type of job that the Newberg area won't likely see again," Greg Pallesen, president of the Association of Western Pulp and Paper Workers union, told NW Labor Press.

WestRock made some attempts to sell the mill, but with caveats that included destroying its papermaking capabilities so the buyer couldn't compete with WestRock. Nonetheless, several suitors considered purchasing the mill, including two international companies that wanted to restart the mill for paper production. But WestRock wouldn't sell to them, perhaps in a move to bolster its hold on the papermaking market that included the 2019 purchase of Kapstone, an industry competitor.

In the interest of getting AWPPW members back to work, Pallesen even tried to broker deals to sell the facility and reopen the mill, but to no avail. He also filed a federal lawsuit claiming that the sale of Kapstone to WestRock would constitute an antitrust violation, but the courts found against him.

"This is unfettered capitalism at its best:" Pallesen told NW Labor Press, "A company that buys competitors and has no intention of restarting them. They spent over $288 million to buy that mill, a mill in Ohio and a Georgia mill, and they closed the Ohio and Newberg mills one week to the day after they became owners."

CDC purchase
The Commercial Development Corp. purchase includes 120 acres of industrial land, four acres of multifamily residential land and 1.5 acres of commercial land located within state-designated opportunity and enterprise zones primarily south of the city limits.

The site includes a large tract of undeveloped land on Wynooski Street adjacent to the Cal-Portland concrete plant, a portion of Rogers Landing marine park and two tracts of residential land on either side of the Newberg-Dundee bypass.

CDC officials said in September that as part of the purchase it has released WestRock from responsibility for the environmental liabilities through its subsidiary, Environmental Liability Transfer, making it solely responsible for the cleanup.

"Our acquisition of this retired plant is the first step in repurposing the property and moving it back into productive use -- the site has phenomenal development potential and we are eager to see the economic benefits this transaction brings to the region," CDC Vice President Adam Kovacs said last fall.

He added that the company will begin soliciting potential buyers for the land and buyers "who could benefit from the large amount of land available and a prime location," as well as proximity to the I-5 corridor, rail access, water rights and access to electrical power.

The company, Kovacs said, expects the site to be ready for redevelopment by later this year, including time to rid the site of all environmental waste and hazards.

"CDC will prepare the site for a variety of end uses, including lot sales, build-to-suit and for lease properties," John Kowalik, vice president of marketing at CDC, said in the fall. "We are still very early in the planning process, but we reposition the property for its highest and best use."

City eyeing land for transformational plan
The city of Newberg recently adopted its riverfront master plan, which calls for development of land adjacent to the mill site for a variety of uses over the next several decades. The plan calls for developing a thin tract of land along the bluff that sits between the Newberg-Dundee bypass and the Willamette River into a commercial, residential and recreational zone that abuts the mill property on the east. If the plan wished to include the mill site, then the land would have to rezoned by the county as it is designated for industrial use.

Not its first rodeo
The CDC bills itself as a privately held company that has acquired and developed "underutilized, distressed or environmentally challenge properties" at more than 300 sites in the United States and Canada since 1990. The company specializes in reclaiming industrial parks, corporate campuses, quarries, landfills, retail centers and environmentally impacted buildings and land, primarily in the Midwest and on the East Coast.

The closest example of the company's work is in Mead, Washington, a suburb of Spokane, where CDC purchased a 1.8 million-square-foot former aluminum smelter on 192 acres from Kaiser Aluminum. Cleanup of the site required removal of cyanide and asbestos.

Much like the plans for the former WestRock mill, the CDC sold the surplus machinery and equipment in Washington, addressed the environmental issues and demolished the smelting line of the factory, where more than 2,000 pots had produced aluminum since World War II.

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