St. Pauls finds itself in right spot

Town benefits from 5 major industrial projects

By T.C. Hunter -

Greg Cummings

Pepsi-Cola is building a distribution center on N.C. 20, just west of Interstate 95. The company picked the location at least in part because of its proximity to Interstate 95.

ST. PAULS — This Robeson County town has turned its location into a major selling point and is cashing in as a result.

According to the town’s administrator and the county’s economic development director, St. Pauls and its 2,400 residents have landed the last five major economic development projects in Robeson County: Johnson Brothers Asphalt in 2014, Sanderson Farms in 2015, Prestage Foods and SPX Meuller Steam in 2016, and Pepsi-Cola Ventures LLC this year.

Between the five projects, almost $170 million will have been invested and about 1,300 jobs will have been created — as well more than 700 jobs preserved.

Johnson Brothers, Prestage Farms and SPX Mueller are outside the town’s limits and will not pay property taxes to St. Pauls, but Sanderson Farms and Pepsi-Cola will fatten the town’s budget by hundreds of thousands of dollars a year when all the incentives sunset, a significant percentage of the town’s $2.4 million budget.

“This was a collaborative effort between Robeson County and the town of St. Pauls,” Town Administrator J.R. Steigerwald said.

The two governments worked closely to get the industrial deals done, he said. The industries all wanted to be as close to Cumberland County as possible. St. Pauls met that criteria and had the water and sewer capacity to meet their needs. The town also has access to Interstate 95 and U.S. 74, which runs to Charlotte and the port at Wilmington.

Proximity to the I-95 corridor played a key role for St. Pauls being selected by Johnson Brothers Asphalt, Pepsi and Sanderson Farms, according to Greg Cummings, the county’s economic development recruiter. The interstate is a major conduit for shipping products to customers and needed material to the companies.

The companies saw other advantages to locating in St. Pauls, Cummings said.

For Sanderson Farms, St. Pauls is close to a feed mill in Kinston, to poultry growers and to their customer base. The town also supplied access to 1,500 acres for Sanderson’s plant operation and a ready employment base.

After merging five facilities in North Carolina and South Carolina, Pepsi chose St. Pauls in part because the town is close to its suppliers and customer base.

Proximity to its customer base in Scotland, Hoke, Cumberland, Robeson and Bladen counties was a big reason for Johnson Brothers Asphalt choosing St. Pauls.

Johnson Brothers Asphalt invested $5 million in its facility and created 36 jobs. Sanderson Farms invested $140 million, and currently has 960 people working at the St. Pauls facility and more are being hired. SPX Mueller Steam invested $5 million in an expansion that created 70 jobs and allowed the company to retain 104 jobs. Prestage Foods invested $2.9 million in its expansion and created eight jobs and retained 327. Pepsi is investing $16 million in its St. Pauls facility and will create 50 jobs while retaining 248 jobs.

And a long dry spell in jobs creation was ended.

“There was a 14-year period with virtually no new jobs,” Steigerwald said. “The only jobs being created were because of Interstate 95 traffic and some commercial expansion.”

Sanderson Farms brought in fewer than 50 people from outside the county, he said.

Then there is the tax revenue.

“We actually do not know the exact revenue as Sanderson Farms’ investments are not completely into the tax assessor’s records,” Steigerwald said. “The company invested $120 million in the St. Pauls facility, but not all of that shows up in the tax records on a dollar for dollar basis. Best estimate at present is that the town of St. Pauls will receive $440,000 in property tax revenue of which $220,000 will be paid to Sanderson Farms as an economic development grant that was in the incentive agreement as executed by both parties.”

Tax revenue from Pepsi is not exact because the company has not completed its construction.

“The announced investment was $16.7 million,” Steigerwald said. “The town agreed to pay as an economic development grant 60 percent of the property tax revenues to be received each year for 10 years.”

The same deal calls for Pepsi to get back 50 percent of property tax revenue assessed for the county each year. The incentives deal for Sanderson Farms and Pepsi are both for 10 years.

“Incentives play a major role when you are competing with South Carolina, Virginia and other counties in North Carolina, Cummings said.

St. Pauls has plenty of uses for the money its industrial neighbors are adding to the town’s coffers.

“The town had about $100,000 a year of deferred needs that the Sanderson Farms tax revenue will allow us to proceed to address,” Steigerwald said.

Among those needs are replacing the Town Hall roof at a cost of $100,000; installing a gate and new doors at Public Works, $12,000; replacing HVAC and removing the boiler from the library, $13,000; remove trees that are dead or damaging roads, $17,000; and buying a dump trailer, $6,000.

“We financed the roof but the rest are cash,” Steigerwald said.

Town leaders also were able to give town employees a 3 percent pay increase in the current budget, a 1 percent cost of living increase and 2 percent merit pay.

“We have authorized the hiring of a new police officer for patrol and have applied to get a grant for a second officer,” he said. “We hope that the Pepsi property tax revenue will allow us to add one or two more Public Works employees.”

This will mean that town streets will be swept with the sweeper more often, Steigerwald said.

“We will be able to trim the grass off sidewalks and out of the streets and spray to get rid of grass in the streets,” he said. “Frankly, due to Hurricane Matthew, the town board is committed to doing much more to improve out storm drainage system. This is very labor intensive and we have benefited from having displaced workers from Lumber River Council of Governments to help us address some of the maintenance issues.”

As a result of the Pepsi deal, St. Pauls got a pump station it didn’t have to pay for, Steigerwald said. Water and sewer were expanded to cover Pepsi, Sanderson Farms at no cost to the city thanks to grants from the state, Golden LEAF and other agencies. Revenue from Sanderson Farms and Pepsi will cover the addition of two police officers, one for each shift, to patrol the areas.

“These two facilities create a lot of traffic,” Steigerwald said. “With a lot more traffic comes more accidents.”

Greg Cummings Cummings

Pepsi-Cola is building a distribution center on N.C. 20, just west of Interstate 95. The company picked the location at least in part because of its proximity to Interstate 95. is building a distribution center on N.C. 20, just west of Interstate 95. The company picked the location at least in part because of its proximity to Interstate 95.
Town benefits from 5 major industrial projects

By T.C. Hunter

Reach T.C. Hunter at 910-816-1974.

Reach T.C. Hunter at 910-816-1974.

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