Nestle Plant is a Rare Treat for Anderson

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Hit hard by layoffs and closings, city to benefit from 300 new jobs.

July 11, 2006

Job-thirsty Anderson is licking its lips, hoping Nestle is the beginning of something sweet.

Nestle USA, famous for its chocolate, announced Monday it would build a beverage-product factory and distribution center in Anderson.

The $359 million facility will employ 300 people, from forklift drivers to manufacturing line workers to salaried managers. Wages will average $19.50 an hour.

"It's an exciting day to be an Andersonian," beamed Mayor Kevin Smith.

Indeed, this manufacturing-heavy city has endured a decade of plant closings, wiping out thousands of jobs. And that hasn't ended, as auto-parts supplier Delphi Corp. plans to close its plant there soon, eliminating 700 jobs. But Anderson celebrated late last month when labor statistics showed it had gained jobs for the first time since 1996.
"Is it a turning point? We'd all like to hope that's what it is," said Tim Monger, a site selection consultant at Colliers Turley Martin Tucker in Indianapolis. "But the real key is, 'What's next?' "

Anderson officials said the hard-hit city could build on the buzz that Nestle's investment would bring. Starting later this year, Nestle will erect an 880,000-square-foot facility on 190 acres along I-69, on Anderson's far-southwest side. By spring 2008, the plant will begin to produce and distribute Nesquik Ready-to-Drink and Coffee-Mate Liquid.

To lure Nestle, a global company based in Switzerland, officials in Anderson coughed up $46 million in tax breaks and infrastructure improvements.

Combined with $7.8 million in incentives from state authorities, the incentives totaled $179,333 per job that Nestle has committed to create -- near the top of recent incentive packages given by state and local governments for manufacturing plants.

"In order to turn things around and to be competitive, sometimes you need to put more dollars on the table," Monger said.

The former General Motors hub has seen the Detroit automaker all but vacate the city. Its spinoffs -- Delphi, Remy and Guide -- have struggled as their former parent lost market share.

Remy has cut its work force by 300 in the past decade. And Guide Corp., which announced 60 layoffs in January, faces uncertain prospects as a GM supplier.

"In the past, Anderson has relied almost exclusively on the auto industry," said Linda Dawson, Anderson's deputy director of economic development. "This is a definite turning point."

Defending the incentives, Anderson officials noted that none of them would siphon off existing tax revenue. And Smith pointed out that $10 million from a bond issue would go to improve to roads for industrial-grade trucks, as well as to provide sewer, a rail spur and a drainage ditch.

All those improvements will also help the Flagship Enterprise Center, a business park adjacent to the future Nestle site, he said.

Nestle came to Anderson to expand its ready-to-drink products, which have been growing rapidly across the beverage industry, said Scott Presley, vice president and general manager of Nestle's ready-to-drink beverage unit.
"Both products are category leaders and have experienced strong growth," Presley said.

Nestle chose Anderson over a site in Lima, Ohio, and well as sites in other states. Presley said the central location, good business climate and manufacturing-experienced work force were the major selling points. He also acknowledged that Nestle was "pleased" with the incentive package. But it was not the only factor, Nestle officials said.

"Anderson has a significant, highly trained work force from the auto industry," Presley said. "We're looking forward to building a great future in Indiana and Anderson."