Newton Falls Fine Paper mill in Newton Falls, New York, being dismantled; Nova Scotia-based owner Scotia Investments must file closure plan with state's environmental authority, but no word on status of equipment removal or possible resale of site

NEWTON FALLS, New York , June 22, 2013 () – The paper machines at Newton Falls Fine Paper are being dismantled and removed, forcing the St. Lawrence County Industrial Development Agency to give up on trying to persuade the mill's owner to resell it as a turn-key business and focus instead on reuse of the site.

"There's no possibility for the facility to have productive capability as a paper mill," IDA Executive Director Patrick J. Kelly said. "Finding ways to redirect the site is obviously a priority."

Sale of the mill intact collapsed in March, and its owner, Scotia Investments, Halifax, Nova Scotia, began liquidating the assets it sold at auction. The IDA had hoped for a while that either the buyers of the paper machines would change their minds about the equipment or that Scotia would rethink the sale. In the meantime, a scrapping operation has begun.

The state Department of Environmental Conservation is overseeing the removal to ensure there are no problems caused by the dismantling.

"We visit the site every few weeks," DEC spokesman Stephen W. Litwhiler said. "It's been very clean."

Scotia also will be required to file a closure plan with DEC that will include how it will handle sewage treatment. The mill's wastewater plant treats sewage from more than a dozen houses in the hamlet.

"We don't have anything from them yet," Mr. Litwhiler said.

A representative for Scotia was not available to answer questions about the status of equipment removal, a closure plan or the possibility of resale of the site.

The IDA will continue to be available to Scotia to help redevelop the plant's 15-acre manufacturing site and 4,000 other acres. The plant property could have a variety of uses, Mr. Kelly said.

"It's an industrial site. There are unique natural resources and there could be activity related to the strengths of the resources," he said. "It's a large facility. There's a lot of management there. That becomes the issue."

At the same time, the IDA is moving ahead with a $9.9 million project -- funded by a state grant -- to rehabilitate a 46-mile railroad that runs through Lewis, Jefferson and St. Lawrence counties. An operating paper mill was to have been one of the rail line's end users. The demise of the mill does not negate the importance of having a viable railroad, as it will serve existing businesses and those that may come, Mr. Kelly said.

"The rail rehabilitation is a regional three-county project that was key to the mill," he said. "In order to be competitive and have sites that meet minimum thresholds, you need certain key infrastructure. Rail is one of them."

Redevelopment of the paper plant and the possibility that the former Jones & Laughlin Steel Co. site might find reuse requires a rail line, he said. The rail is also important for Benson Mines, which has said it is necessary to ship granite.

"There's activity up there right now," Mr. Kelly said. "We want to encourage that."

Clearing of the line, final engineering plans and permitting for the rail work will start soon, Mr. Kelly said.


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