If it were a house, Steel Dynamic’s $100-million expansion would be in the “moving in the furniture” phase.
It’s a little more complicated than that, but SDI’s new paint facility is very near completion, said the facility’s manager, Jeff Roach.
“We are nearly complete with the construction phase and are simply putting the finishing touches on buildings, cranes and auxiliary equipment,” said Roach, who noted the project is ahead of schedule.
“We are excited to be in the equipment commissioning phase now,” he added.
Groundbreaking for the 220,000-square foot facility, located just south of Steel Dynamics’ main facility in the Lowndes County Industrial Park off Highway 82, began in late January. At that time, company officials estimated the expansion would create 40 new jobs.
“There are actually 47 jobs that will have a direct impact on the production of the new paint facility,” Roach said. “We’ve filled 44 of those jobs, and the remaining jobs will be filled in the next few months.”
Roach said the company hopes to hit the ground running as soon as all equipment is in place.
“We will certainly be challenged with some of the normal start-up issues, but I am extremely optimistic that this period will be short,” he said. “Some of our key positions have been filled with individuals who have extensive experience operating paint lines. In addition, all of our new team members spent a month training at our other SDI paint facilities in Indiana. …I’m confident they are ready to go.”
Background
Steel Dynamics is one of the largest steel producers and metals recyclers in the United States, based on estimated annual steelmaking and metals recycling capability, with annual sales of $8.8 billion in 2014, more than 7,700 employees, and manufacturing facilities that include six steel mills, eight steel coating facilities, two iron production facilities, over 90 metals recycling locations and six steel fabrication plants.
The expansion will increase employment at the Columbus plant to almost 680 people.
In addition to the new paint facility, the project also expanded the company’s Galvalume capabilities. Galvalume is a zinc/aluminum coating that is more corrosion-resistant than traditional galvanized steel.
Roach said when the paint facility is fully operational early in 2017, it will produce 20,000-plus tons of painted steel each year. Adding paint to steel that can be molded and pressed without fading or cracking adds value. Its most popular use is for roofing.
Local impact
The expansion comes 27 months after Indiana-based Steel Dynamics Inc., purchased the rolled steel mill from Russia-based Severstal.
In addition to providing additional jobs and tax revenue, the expansion demonstrated SDI’s commitment to the area, Lowndes County Board of Supervisors President Harry Sanders said.
“What it says is that they are happy to be here and pleased with Lowndes County and the state of Mississippi,” Sanders said. “They could have gone anywhere — they have steel plants in Indiana and other places — but they chose to be here. We’re happy to have them because we know what it means to our community.”
Backing the company’s $100 million investment, state and local entities put up $2.85 million in grants, along with a $1 million commitment from Lowndes County, which used the money to extend rail service to the site.
Supervisors approved two fee-in-lieu agreements in July 2015 to support expansions at the steel mill, which will allow the company to pay taxes on one-third of the new facility’s assessed value for 10 years rather than the full ad valorem rate.
Sanders said the fees still will produce about $500,000 annually for the county during the agreement period, a portion of which will help fund the county’s public school district.
The most recent fee-in-lieu agreements marked the third and fourth such arrangements at the plant since it opened in September 2007. The first of those comes off the books on Jan. 1, when Steel Dynamics will pay full taxes to the county and the county school district.
“That will add roughly a net increase of $8.4 million annually, maybe a little less when depreciation is factored in,” said Lowndes County Tax Assessor Greg Andrews.
The county and school district will receive those tax revenues in February 2018. The second fee-in-lieu will come off the books in 2019, Andrew said.
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected].
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