FALLON - Indiana company Steel Dynamics, Inc., announced Monday its purchase of the Commercial Metals Company Joist building and plans to hire 125-150 employees, said Eric Grimes, executive director of the Churchill Economic Development Authority.
"Our unemployment rate will go down significantly," Grimes said. "It will bring in some much needed tax dollars to the community. It will essentially help stabilize the economy."
The building will become a part of SDI's wholly owned subsidiary, New Millennium Building Systems, which also makes joists and decks. Grimes said SDI approached CEDA a few weeks after CMC Joist closed in April when about 100 people lost their jobs and many moved away.
According to a press release, SDI purchased the Fallon CMC property along with two others in Hope, Ark., and Juarez, Mexico for $17 million.
"With our purchase of these assets, New Millennium will become the nation's second largest provider of steel joists and decking," said Keith Busse, chairman and chief executive officer of Steel Dynamics. "Our purchase of these assets from CMC will give New Millennium an opportunity to immediately begin implementing geographic expansion plans that have been on the back-burner during the economic crisis."
Although Grimes said operations will begin soon, Executive Vice President Gary Heasley of Steel Dynamics and President of New Millennium Building Systems said rehiring may be a slow process.
"Because of current market conditions, we expect the re-staffing of the reopened plants to be gradual," Heasley said. "We look forward to bringing jobs back to our plants' communities as the nonresidential markets recover."
Nevertheless, Grimes said new jobs will still impact the local economy because for each manufacturing job there will be an average of six additional jobs created in other industries. Grimes explained with each new worker, there is additional spending. Local businesses will experience an increase in demand and hire new employees.
District Office Manager Karen West with Job Connect confirmed unemployment, which is currently at 10.9 percent in Churchill County, will go down.
"We've got a lot of people coming into the office pretty excited about (SDI's purchase) - it does help the economy a lot," West said. "Anytime an employer comes in, even if it is a small mom and pop, it impacts the community in a positive way. It's not necessarily going to take away all of our problems, but it's a good start."
Grimes said New Millennium doesn't plan to give former CMC Joist employees preference, but they will hire those who qualify.
"They are a fantastic company that are extremely good to their employees," Grimes said, adding they even give performance bonuses. "They have great benefits. They are just a really great company. They said they are going to try to hire as much local as they can."
Additionally, Grimes said New Millennium is a company that is community friendly. This has become a growing concern among county officials and residents after multiple problems with local industry have arisen, such as an alleged smell from Bango Oil LLC and noise from the Enel North America's Stillwater Geothermal Plant.
"From everything I've seen, they are very big on being cooperate citizens," Grimes said. "They're into giving back to the community. I think these guys are really into doing what's best for the community."
There also will be more tax dollars going to the local government. When CMC Joist closed, Churchill County Comptroller Alan Kalt estimated the loss of the local payroll to be somewhere between $3.5 million to $5 million. County Assessor Norma Green said CMC's annual tax for real property was $60,762.59, and the personal property tax was $16,813.50.
"Now that you're going to have an extra $3 million to $5 million added back into the economy, that has an affect on taxable sales - that does help fund local government, including the city, county and the school district," Kalt said.
Mayor Ken Tedford Jr., agreed and said he would "indeed hope" this purchase could be the beginning of the end of the recession in Fallon and Churchill County.
"This is very positive news, and I think that's how we need to look at it," Tedford said. "There is a light at the end of the tunnel. I think this is a good sign of that. CMC, as you know, was a large player in our business community."