IP again largest taxpayer in Isle of Wight County, Virginia, following reopening of its Franklin, Virginia, mill for fluff pulp production, in addition to separate tissue and lumber operations; IP paid county more than US$3M in total taxes last year
ISLE OF WIGHT
July 4, 2014
– International Paper is once again Isle of Wight's largest taxpayer, paying the county more than $3 million in real estate, property, business equipment, machinery and tools over the previous fiscal year.
This represents a huge resurgence in revenue for the county -- International Paper was Isle of Wight's largest taxpayer for decades until it shuttered much of its complex in the southernmost segment of the county in 2009 and 2010.
Since the closing, bits and pieces of the complex have been whirring back to life in different incarnations -- a fluff fiber mill and a recycled tissue plant took over parts of the campus in 2012. In 2013, the mill spun back to life, again churning out lumber under Franklin Lumber, a company started by former mill employees.
The jump in taxes from International Paper, according to Commissioner of Revenue Gerald Gwaltney, comes from that fluff fiber mill. Last year was the first year that facility was on the books for the county's tax collectors, because the tax collection only applies to what is up and running each January.
The county's second-largest taxpayer paid less than a third of what International Paper will put into the county coffers. Gwaltney, a subsidiary of Smithfield Foods, paid just under $900,000 in taxes for this past year. The company was the county's largest taxpayer for 2012, shelling out about $887,000.
In all, the county's top 10 taxpayers generated $6.07 million for the county, three and a half times as much as the previous year's 10 largest contributors, which Gwaltney says is great news for the county.
"It reduces the pressure on the individual homeowner and taxpayers because our industrial base is returning to life and is now generating new revenue," he said. "In general, revenues are slowly recovering from the Great Recession."
The new income didn't prevent a 12-cent real estate tax increase in Isle of Wight, which took effect July 1.
Board of Supervisors Chairman Byron "Buzz" Bailey said the increase would likely have been more severe if not for the new business revenue.
"We factored in what additional revenue we were going to get. We factored in everything we could to keep the taxes," Bailey said.
Bailey said the tax increase "could easily have been" 15 or 16 cents on the dollar without a boost in revenues from Isle of Wight's big businesses.
One cent in real estate tax means about $400,000 in income for the county. Bailey said revenue growth from businesses and careful planning by county officials leaves him confident that the board won't need to raise taxes again for the next couple of years.
Murphy can be reached by phone at 757-247-4760.
Top 10 Taxpayers in Isle of Wight for FY 2014
1 -- International Paper -- $3,046,035.90
2 -- Gwaltney -- $897,686.42
3 -- Cost Plus -- $577,699.83
4 -- Virginia Electric and Power -- $547,400.94
5 -- Smithfield Foods -- $313,397.35
6 -- Keurig Green Mountain -- $311,451.09
7 -- Safco Products -- $146,707.28
8 -- CR England -- $105,338.84
9 -- Food Lion -- $65,328.66
10 -- Charter Communications -- $62,744.09
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Industry Intelligence Inc. editor's note: According to Industry Intelligence's archives, International Paper Co. spent US$90 million to revamp a part of its Franklin, Virginia, pulp and paper mill to produce up to 270,000 tonnes/year of fluff pulp, according to Industry Intelligence's archives. The mill was restarted in early July 2012. The other area of the Franklin mill is occupied by ST Tissue LLC, which converted a machine at the former uncoated freesheet paper mill to produce 70,000 tons/year of tissue paper.