The city of Clinton has taken another step in an economic development project that will serve to benefit the community and its largest employer.
On Tuesday, the City Council approved a conditional use permit request and engineering contract with Wooten Company for the construction of a 145-foot elevated water tank to serve Smithfield Packing Company. The Council also officially signed off on the N.C. Rural Center Economic Infrastructure Grant application that will act to pay half of the nearly $1.8 million cost for the project.
The City Council approved a request for a conditional use permit in order to move forward with the construction of the elevated water tank, located at a city-owned site off Southwood Drive. Adjoining property owners were notified and no one spoke in opposition during Council’s Tuesday night meeting or the previous Planning Board session. Council members subsequently approved authorizing the resolution and memorandum of understanding for the Rural Center grant.
“The city has been pre-approved for a $885,000 grant for the construction of an elevated water tank,” said city manager John Connet. “The grant is based upon the creation of 89 jobs by Smithfield Packing Company. The city will be entering into a performance agreement with Smithfield to ensure they are committed to creating and maintaining the jobs for six months. I’ve had several conversations with Smithfield on numerous occasions, and most of these jobs have already been hired or completed.”
A subsidiary of the world’s largest pork producer and processor Smithfield Foods, Smithfield Packing Company Inc. operates a meat processing facility at 424 E. Railroad St., Clinton.
Earlier this year, Kenny Cabral, human resources manager for Smithfield, said a second shift had been added to the cutting operation at the Clinton plant, tacking on an additional 160 jobs at the facility. That shift, whose primary focus is to process an export product known as JBO (Japanese Boning Operation), was implemented during the first part of April and grew Smithfield’s local employment to 1,750.
That job creation assisted the city, which in partnership with Smithfield, then sought to piggyback the new jobs by applying for a state development grant that could act to benefit the city, Smithfield and the community. The grant award, announced in April, was made possible due to the new jobs, Wooten Company engineer Chris Thomson said.
Cabral said he was pleased with the Rural Center’s support of a local economic development project, one that would create a partnership between the company and community to benefit many.
“The grant will allow us to create a second shift at our facility that will allow us to provide product to our Japanese market and will require the creation of at least 89 new full-time jobs with an average annual salary of $23,400,” he noted. “An added benefit surrounding the addition of these jobs is that it allows us to partner with the City of Clinton and the North Carolina Rural Development Center in applying for a grant to assist with updating the infrastructure within Clinton. This, in turn, benefits both the community and Smithfield.”
Smithfield currently uses private, on-site wells for its total water need. The proposed project will increase the amount of finished water storage available to Smithfield by constructing a half a million gallon elevated water storage tank. It would provide the additional 300,000 gallons of finished water storage to allow the facility to comply with existing state regulations.
If the second shift increases water demand to be in excess of the 1.2 million gallons per day, it is possible additional capacity in the tank could be reserved for Smithfield to meet those regulations. The remaining capacity would be available to the city.
As a stipulation of the Rural Center grant, projects are expected to be under contract within six months of the date the Rural Center awards the grant, and Rural Center funding may not exceed 50 percent of the eligible project costs. The city has proposed to make up its half if the $1.77 million project from Water and Sewer Fund revenues.
“We will be responsible for obtaining funding for the other half of the project, which we feel like will not be a problem,” said Connet, “because our debt service is coming off our existing projects, and we will finally be able to bring on Smithfield as a water customer, so we will have some additional revenue there. We recommend moving forward with this grant application. This is a Rural Center grant between us, Smithfield Packing and the North Carolina Rural Center.”
The performance agreement as part of the grant states that, if all the jobs are not created, Smithfield Packing will be required to repay the city of Clinton and the N.C. Rural Center $10,000 per job no created. In an Aug. 23 letter to Smithfield general manager Kyle Narron, Connet said that tab would be picked up by the city.
“I wanted to reassure you that if for some unforeseen reason any or all 89 jobs are not created,” Connet stated, “the city of Clinton will repay the grant funds on behalf of Smithfield Packing. I hope that this letter will ease any concerns you or anyone else may have in executing the Performance Agreement. We know this project will be successful and appreciate Smithfield’s support.”
Also on Tuesday, the City Council approved an engineering contract with The Wooten Company for the elevated water tank project to serve Smithfield, at a cost of $254,000 over the life of the project for design and administrative service, construction administration and various additional services, to include resident inspection.
The elevated water tank is a complement to a $5 million project that will see the city’s water treatment plant expanded by 1.5 million gallons and the establishment of a redundant water line. The ultimate goal is to ensure the city has an adequate water supply for the next 20 to 30 years. The tank would provide a greater amount of water storage capacity for what would be the city’s biggest customer and will also, with the expansion of the water plant and job creation at Smithfield, allow for improved fire protection in the southeast side of Clinton and better service in that area as a result.
“This is an ongoing project,” said Mayor Lew Starling. “We’ve looked at this thoroughly, and this is in conjunction with what we are doing with our partners over at Smithfield.”
Chris Berendt can be reached at 910-592-8137 ext. 121 or via email at sicrime@heartlandpublications.com.
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