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Kimberly-Clark developments bring relief, some optimism

 

Local leaders are relieved by developments in the last 24 hours in the continuing saga of Kimberly-Clark Corp.’s on-again, off-again plant closures in the Fox Cities.

With the state Senate now scheduled to vote in November on giving the company a tax incentive package worth tens of millions, there’s a chance that at least one plant will continue to operate here.

“We have light at the end of the tunnel,” said bill co-sponsor Sen. Roger Roth (R-Appleton). “Things are looking very good.”

The Senate will meet after the election in an Extraordinary Session to vote on Assembly Bill 963, the incentive package previously passed by the Assembly.

The session starts Nov. 12 with a Joint Finance Committee hearing. A vote could take place after that, when Senate Majority Leader Scott Fitzgerald coordinates legislative calendars.

Kimberly-Clark spokeswoman Brook Smith said on Tuesday that the company is waiting for Senate action before it makes its final decision.

“While we remain eager to firm up our plans and minimize the uncertainty being felt by our employees, we will not make any final decisions regarding the Neenah Cold Spring Facility until the Legislature completes its extraordinary session,” she said in an email to USA TODAY NETWORK-Wisconsin. 

Roth said “we had to remove this bill from the political election cycle."

"There would be no support from Democrats and we need support of the Democrats to get it done,” he said.

Both Roth and Gov. Scott Walker, who supports the bill, are running for re-election on Nov. 6.

“Removing it out of the election cycle changes the dynamic. Democrats don’t have to think about ‘well if I vote for this I’m helping Scott Walker.’ It removes all of that. Now the question will be ‘do I want to vote to support family supporting union jobs. Yes or no,’” Roth said. “Outside of the pressures of an election, I can’t conceive of a scenario where Democrats would not vote to support that. That’s why I’m very optimistic that we’ll be able to get this done in November.”  

Roth faces opposition on the bill from some of his own party, including Chris Kapenga (R-Delafield).

“This is a precedent that we should not set. Wisconsin has robust existing programs to promote economic development and job retention that Kimberly-Clark can attempt to utilize, just as any other company can. For these reasons, I would not support the proposed legislation," Kapenga said in a statement. 

Roth said Tuesday there is “significant support' for the legislation in the Republican caucus. "“I’m confident that the votes will be there to stand behind the men and women who work at this facility.”  

Local officials remain optimistic on the bill's chances. 

“I believe there’s a very good chance that it will pass,” said Neenah Mayor Dean Kaufert. “Right now, it’s all politics. They’ve dug in their heels. The Democrats believe not helping (with the bill) helps them in the election. Some Republicans believe it will hurt them in the election.”

Kaufert said a post-election bill could get bipartisan support.

“It can be done. When I was in the Legislature, it worked with Mercury Marine. It was almost a unanimous vote. That was a success story and it now has more people working and they’re making more money,” he said.

In Fox Crossing, Village President Dale Youngquist said he’s “somewhat optimistic” given Roth’s comments.

“He exudes confidence,” Youngquist said. “Based on Senator Roth and Senator Fitzgerald’s comments, the votes will hopefully be there. They want this business to stay in Wisconsin. Hopefully the Senate will pass that incentive package and Kimberly-Clark will stay in the village of Fox Crossing for many years to come.”

The village’s director of community development sees it as an easy vote.

“It clearly makes sense to support an existing business, a going concern. It should be a slam dunk,” said George Dearborn. “It’s a job retention situation. It’s 500 decent-paying jobs in the village that contribute to housing and economic development.”

Kaufert said the bill can be passed as written even though Kimberly-Clark told Fitzgerald that it intends to close its Neenah Nonwovens plant. The bill currently includes both the Neenah Nonwovens plant and the Cold Spring plant in Fox Crossing.

“I would hope they would consider keeping it open, but the reality is, and in discussions with all parties, it appears that decision has been made by Kimberly-Clark,” said Kaufert. “The bill is based on the number of jobs. So if they would keep that open, they would qualify for incentives for those jobs. But it does appear they made that decision.”  

Kaufert said the ultimate decision by K-C will, at a minimum, give closure to the issue.

“For sure, there will be some finality. I understand they have a business to run and decisions to make,” he said.   

Some have criticized the bill, saying most manufacturers, including Kimberly-Clark, do not pay state corporate income tax, and that the tax credit in the bill would actually be a cash payment made to the company.  

Roth said other taxes should be considered, including the local taxes K-C pays to Fox Crossing and employees’ state income taxes.

The company contributes to the local economy by buying materials from more than 200 local firms, he said.  

“They pay more than $1 million in electricity every month. You take them out of the local area, and that will cause local energy rates to rise,” he said.

Roth said the capital expenditure tax credit in the bill will encourage the company to put more money into the facility.   

“We want them to invest in the future,” Roth said. “They’re looking at the potential of a half a billion dollars of investment in the facility over the next 15 years.”

The Cold Spring plant makes Depend adult incontinence products, as well as other hygiene products.

“Baby boomers are moving into retirement and there will be more and more of a demand for these products. This is all going to be happening right here," said Roth. "This is an investment into a company making things that will be in high demand for the next 30 years.”