Global paper producer Kimberly-Clark is asking Mobile County officials to match economic development incentives the city of Mobile has already approved, which would add a year of sales tax abatements to a package that already includes millions in tax breaks.
Kimberly-Clark, which produces a stable of paper products with household names like Scott, Cottonelle, Kleenex, Kotex and Huggies, operates a tissue mill in Mobile currently employing more than 600 workers.
Earlier this year, the company announced plans to construct a $75 million on-site “combined heat-power plant” at the Mobile mill, but that was actually part of larger, $110 capital investment plan likely to be implemented over the next two years.
The remaining $35 million of that investment is planned to be spent on new machinery used in the production of toilet tissues as well as a new assembly line, and local officials have already agreed to provide some tax incentives to secure those additions and the 17-21 new jobs they’re expected to create.
The Industrial Development Board (IDB), which oversees Mobile’s project agreements, approved roughly $1.4 million in incentives earlier this year. Those included $350,000 that will accumulate over a 10-year abatement of the non-educational ad valorem taxes and a one-year, $1.1 million abatement of sales and use taxes during construction.
The Industrial Development Authority (IDA) serves a similar role for Mobile County and has previously approved a $1,025,000, 10-year property tax abatement.
If Thursday’s request from Kimberly-Clark is approved, the Mobile County Commission would add an additional $750,000 sales tax abatement to the mix — a similar, though slightly higher contribution than the city’s.
Including a limited contribution from the state of Alabama, Kimberly-Clark has been offered an economic incentive package valued at $4,175,000 over the next 10 years in exchange for 17 direct jobs with annual salaries listed at $88,235 on average.
According to the analysis of the Mobile Area Chamber of Commerce, the project could have a likely tax benefit of $4.6 million for the city and county, respectively, though that’s reduced somewhat when the cost of the abatements is factored in.
Chamber representative Shelby Glover presented the proposal to the commission Thursday morning, and while there were some questions, there weren’t verbal objections to the additional allocation.