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Berry Plastics to Reopen, Investing $96 Million and Bringing 420 Jobs to Madisonville

Berry Plastics_coverMADISONVILLE, KY (10/30/12) – Just over a year after Berry Plastics announced it would close its Madisonville facility, the manufacturer declared its return to the city at a joint news conference today. About 80 people gathered at Madisonville-Hopkins County Economic Development Corporation (EDC) this morning for the announcement. Notable attendees included local business leaders, local and state elected officials, and Berry executives as well as members of the news media.

Berry originally occupied the large building at 515 Island Park Drive in August of 2011 when it acquired Rexam Specialty Beverage Closures for $360 million, but their stay was short-lived when they redistributed production to other sites that had “excess capacity.”

County job-seekers can expect to begin the process of applying for positions with Berry within the next month or two, according to the firm’s Human Resources officer.

The reopening was described as “one of [the] largest projects ever announced” locally by EDC Chairman Kent Mills in his opening remarks today. The move will create 420 new jobs and represent $960 million in investment. “Now, I would call that significant,” Mills said, adding that the EDC worked for several months with officials from Berry Plastics negotiating the project. “I applaud them for working with us and the state to eventually choose Madisonville for their new investment.”

Mills thanked the city, county, state, EDC board, Madisonville Community College, Kentucky Utilities, and Atmos Energy for their diligence and for working as a team. He said that the EDC looked forward to a “Long and mutually beneficial relationship” and vowed to work closely with Berry to help them realize success in Madisonville.

Governor Steve Beshear arrived at the event to rousing applause and was the next to speak.

“This is really good news,” said Beshear. “In looking back at the different announcements that have been made in Hopkins County over the years, this is one of the biggest and, I think, one of the most significant in a long, long time.”

He added that labeling Berry’s return as a reopening would be an understatement, given the massive job and investment increase. He described it as “something to celebrate” and “…exciting news, which demonstrates the company’s intent to build on its reputation as a global manufacturing leader in its field.”

Beshear spoke to Berry’s already significant presence in Kentucky, with more than 950 employees at multiple facilities within the state. Referencing the incoming jobs, he said, “As we know very well, that 420 isn’t just a number. That represents 420 of our families—Kentucky families—who are going to be able to lay their heads down on their pillows at night feeling a lot more confident and secure ….”

He expressed confidence that the investment will improve quality of life for families and the community as a whole, following the historic recession that “hit us full in the face.”

Berry Plastics_body_1“Many states sort of pulled back in and hunkered-down … we did just the opposite. We said, ‘we’ve got to get more aggressive …’ Folks, that strategy is working. We’re continuing to strengthen Kentucky’s economy and create jobs for our families because we’ve partnered with our businesses.”

Beshear cited the US bureau of Labor Statistics, which reported that from September 2011 to September 2012, Kentucky ranked second in terms of job growth. “And, think of when we did it. We did it in the worst economic times that you and I have ever lived through,” he proclaimed.

Finally, the governor pointed to programs and incentives for incoming businesses that he said have resulted in 16 new announcements of industry expansion in the county—expansions in manufacturing and supportive services sectors during his administration that have resulted in 800 new jobs and $128 million in new capital investments. He went on to say, however, that there is still room for improvement.

“As good as we’re doing, I’m not satisfied, and I know you’re not either, because we’re still not completely out of this recession, we’ve still got a ways to go, and we’ve still got too many people out of work.”

Beshear presented a Kentucky flag to Jon Rich, Berry Plastics’ CEO, adding that it bears the motto “United We Stand, Divided We Fall,” a fitting theme reflecting the cooperation between government and business that resulted in Berry’s reopening.

Rich took to the podium following Beshear and lumped the Madisonville opening with other important milestones for Berry such as their becoming public, with shares now being traded on the NYSE (NYSE: BERY).

“Like the Commonwealth, the Berry team certainly doesn’t hide its head in the sand when the going gets tough,” he said, highlighting their focus on research and development.

Rich said that the results of this intense R&D push have been new inventions that the new facility will turn into reality. “This is exactly what business partnering with government can and should do to lead our way out of the economic slowdown, which has gone on for too long. This will be Berry’s fifth plant in Kentucky, and key factors such as the trained workforce and relationships with state and local governments all factored in to our decision.”

Rich lauded the $15-20 million a year in compensation that will be paid to employees—money that he said will be spent locally, generating significant tax revenues for Madisonville, Hopkins County, and the state.

The next speaker was Mayor Jackson, who acknowledged all of the government and business players present at the conference and said, “This is truly a wonderful day for our city. To put it into perspective, 420 jobs represents about five percent of the 8,000 households in Madisonville. So, we’re very excited to have such good news. Not only is this a great day for Madisonville, but, Mr. Rich, I think this is a great day for Berry Plastics. Our community has many resources and wonderful people, who stand at the ready to ensure that your investment in Madisonville was a good one.”

Berry Plastics_body_2Jackson pointed out that Madisonville Community College would also be a valuable partner, working with Berry “in a multitude of ways, from employee selection to ongoing customized training. Our community college has always been a great community partner, and I ensure you they look forward to partnering with Berry plastics in the months and years ahead.”

Rounding out the panel of speakers was Magistrate Larry Wilson, who delivered congratulatory remarks on behalf of Hopkins County Judge Executive Donald Carroll.

An element of mystery surrounds the specifics of production as Berry rekindles operations in Madisonville. When asked, Rich said only “This investment in Madisonville is a product of some exciting inventions that people in our engineering department have made. This will be a completely new product line for us. We’re very excited about the opportunity to serve a broad base of our customers with this product. This represents a leap in invention and an investment in technology, and we’re really excited.”

When pressed about the specifics of the new product, Rich declined to elaborate. “We’re working very closely with an extremely large customer, and I hope in the future we’ll be in a position to make a joint statement together with that customer, but I don’t want to get ahead of my customers in terms of jumping the gun.” He said that he hopes to be able to promote the facility again in “a few short weeks” with the announcement.

Construction has already begun on facility upgrades. Rich hopes to begin the process of moving equipment into the new facility before the end of the year and anticipates production to begin by the middle of 2013. He added that the original plans for production capacity have already been doubled because of the excitement surrounding the new “product and customer opportunities”.

Berry Plastics Corporation’s Economic Impact on Madisonville:

DIRECT

- 420 direct jobs
- $17.60 per hour average wage
- $36,608 average annual wage
- $16,800,000 annual payroll
- $96,000,000 total investment

INDIRECT

- 331 induced and indirect jobs (equaling 751 total jobs)
- $23,139,000 new payroll
- $14.81 average wage per hour
- $30,810 average annual wage

*source: EDC

Casey Piscitelli
SurfKY News

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