Local plant eyeing expansion in Wayne
By Andrew Bell
Published in News on July 16, 2006 9:57 AM
Uchiyama America plans to make about a $15 million expansion within the next few years, which would create an additional 100 jobs for the community.
The only problem is, company officials haven't decided which community that will be.
Problems in Wayne County over the past year have made Uchiyama's executives question whether to expand locally or to move some of the company's operations to a neighboring state, said Dave Parsons, the company's human resources manager.
Uchiyama America has been in Wayne County since 1997 and creates seals and gaskets for Japanese car manufacturers. Wayne County's plant is the only facility located in North America. Company officials say this location has been very productive. The company just completed an 18,000-square-foot expansion here.
Developments over the past several months have worried Uchiyama's leadership, Parsons said. Costs to expand in North Carolina are higher than in neighboring states.
Parsons said the state has been a good fit for the company since North Carolina does not have a car manufacturing plant that buys products from Uchiyama, allowing the company to stay unbiased toward any one customer.
Wayne County also has a low unemployment rate, Parsons said.
Wayne County Development Alliance existing business specialist Mike Haney said the county's unemployment rate hovers between 4 and 5 percent, which could make it more difficult for Uchiyama and other firms to find additional workers after expanding.
Increasing costs to developers to limit nutrient runoff into local waterways also are a concern. After a recent administrative ruling, developers must pay $56 per pound per acre, up from $11, to build at a site. The money will be used to limit the concentration of nitrogen sediments in the Neuse River.
Local economic development and county officials claimed that the drastic increase would halt development in the region. If Uchiyama were to make a major expansion at its plant, the administrative ruling could have the company paying hundreds of thousands of dollars more than the company would have had to pay a year ago for nutrient runoff fees.
Measures are being taken in the state House and Senate to lower the price back to $11 per pound per acre until a committee can be formed to determine a more reasonable price increase.
All of these variables have made Uchiyama's leadership reconsider expansion in the area. But Parsons said a decision not to expand would not be the end of Uchiyama in Wayne County.
"It's not that we would move. We would take some of our operations and move them and keep some of them here. But I can say that we wouldn't be as big of a presence as the 240 employees we have now," he said.
The company's executives have met with representatives from the state Department of Commerce, the city of Goldsboro, Wayne County and the Wayne County Development Alliance so they could convey their concerns about expanding in Wayne, Parsons said.
"It was encouraging because we were told that they would do anything possible to keep us here," Parsons said.
Local economic development officials said they will do everything in their power to make sure that expansion stays in Wayne County.
"We will do what is needed and invest thoroughly in what they need from the community and the state for them to expand here," Alliance President Joanna Thompson said.
Ms. Thompson said various local and state representatives have met with Uchiyama executives, but added she would not go into detail because she had assumed the meetings were to be kept confidential.
But she did say that after the meetings, all of the parties involved are "on the same page" and will work to ensure Uchiyama's expansion happens in Wayne County.
In addition to continuing to lower the runoff fees, local leaders can apply to the state for incentives to offer the company if officials start leaning toward moving out of North Carolina.
For example, tax credits, bonds and grants are used as an incentive to keep new jobs and investments in the state, Haney said.
But unlike previous years, the county's tax credit rating has moved up a tier. This means that the state is required to provide fewer tax credits per job created in Wayne County. Last year, Wayne -- as a Tier 3 county -- could provide a $3,000 tax credit per job created, but now, at Tier 4, officials can only provide $1,000 per job created, Ms. Thompson said.
But there are many other incentives available to Uchiyama America. Ms. Thompson said talks between local officials and company executives are in "the infancy stages" and there is still time to research the company's concerns and options.
Parsons said this means that Uchiyama's executives will have to play the waiting game.
"They've heard and are aware of our concerns. We're just waiting for them to come back with some proposals and see if we can work something out," Parsons said.
Parsons said he expects there will be more meetings between Uchiyama executives and local leaders, but he doesn't know when.