Blair is on a fast track to adding 175 full-time jobs at its Irvine Distribution Center.
The company, with the help of state and local development agencies and elected officials, has identified a variety of funding streams that will provide more than $2 million to enable the distribution center to handle the distribution of Arizona Mail Order business.
That expansion will require at least 175 additional full-time workers, according to Jude Dippold, Blair director of corporate communications, and the addition of the Arizona work will enable the distribution center to have a more even staffing level year-round.
"We're very excited," Dippold said. "To have this happen during an economic downturn like this, we're just thrilled with it."
When Orchard Brands, the parent company of Blair, added Arizona last year, there was no guarantee that Orchard Brands would center the Arizona distribution in Irvine, according to Dippold. Arizona represents an estimated $150 million in annual sales.
To make sure that happened, Blair officials worked on the deal with the help of Jim Decker, president and CEO of the Warren County Chamber of Business and Industry (WCCBI) for more than a year.
"We treated this as a competitive recruitment initiative instead of a business expansion," Decker said. "Orchard Brands could have located this in several locations outside of the Commonwealth of Pennsylvania."
Bringing Arizona to Warren County meant big changes locally.
The Irvine facility was not ready to add the product handling and storage requirements of a company the size of Arizona.
According to estimates, "the project at the distribution center was going to cost approximately in the $4 million range," Dippold said.
Telecommunications and information services improvements to ensure a seamless connection between Arizona's orders and Irvine's order processing would take "another couple million," Dippold said.
"We realized that, to bring that business here, we'd have to make a lot of changes here," he said. "The scope of the project was quite large. The overall costs of that project were going to be so large, we thought we were going to need help to bring that here."
"We didn't think we could carry the whole load ourselves," Dippold said. "We went to Jim Decker."
Decker helped the company identify appropriate and available funding streams for the project.
According to Luke Webber, spokesman for the state Department of Community and Economic Development (DCED), a total of more than $4 million in grants and loans will be made available to Blair.
The Governor's Action Team (GAT) worked out an agreement with Blair.
The company is eligible for up to $275,000 in low-interest loans from the Machinery and Equipment Loan Fund (MELF). Those are matching funds; for every dollar loaned, Blair would have to put up a dollar of its own.
Another $2 million in Pennsylvania Industrial Development Authority (PIDA) loans will probably not be used by the company, according to Dippold.
"We don't think we're going to accept the PIDA loan," he said. But, "that's still an option."
The state would require a second lien on the distribution center if the PIDA loan is accepted. Dippold said there are already liens against the property and adding more would be complicated.
"In hard construction costs, we didn't even have $2 million," he said.
The company would have to more than match the PIDA loan amount. PIDA will pay up to 40 percent of project costs and Blair would be responsible for the remaining 60 percent.
The company expect to fully utilize a Redevelopment Capital Assistance Program (RCAP) grant in the amount of $1.4 million, another $750,000 in state grant funding, and the full $275,000 MELF loan.
Part of the agreement between Blair and GAT is that the company will add 175 new, full-time jobs within three years while retaining 536 existing positions.
The time frame will not be a problem for Blair.
"We will be adding these jobs, probably partially in the fourth quarter of this year and partially in the first quarter of 2010," Dippold said. "By sometime in the first quarter (next year) we're going to have all those 175 on board."
"We're actually going to start bringing their product in this summer," Dippold said. "We'll begin distribution in the fall so they'll be here through our peak season."
"This project represents Orchard Brands' faith in the capabilities of the Irvine Distribution Center, the work ethic and skill of the area's labor force, and the potential of Warren County," Orchard Brands Chairman and CEO Neale Attenborough said. "It gives all of us at Orchard Brands a great deal of satisfaction to continue building on the excellent facilities and sheer potential which Blair brought to our company."
Bringing all of the necessary funding together in a hurry couldn't have happened without help in government. "You can't overemphasize the effort that was put forth by our elected officials," Decker said. "That was a very difficult time to get funds released at any level."
"We owe a deep debt of gratitude to (state) Sen. Joseph Scarnati, who supported us from the start and helped marshal the political clout of his office along with the support of Sen. Mary Jo White and Rep. Kathy Rapp to win the legislative support necessary to make this happen," Blair President and CEO Shelley Nandkeolyar said.
"We deeply appreciate the assistance of the state of Pennsylvania and Gov. Edward Rendell in making an undertaking of this size and scope possible and for convincing us that Pennsylvania was the best location for Arizona Mail Order's distribution work," Attenborough said.
Officials also praised Decker's efforts.
"From the time this project was first conceived as a possibility more than a year ago, no entity has been more instrumental in turning it into a reality than the Warren County Chamber of Business and Industry under the leadership of Jim Decker," Nandkeolyar said. "Without his belief in this project and his willingness to explore every avenue to make it happen, the prospects on our horizon would be much different today."
"He jumped in right from the start and was instrumental in lining up state programs that he thought we would be eligible for," Dippold said.
By helping Blair and Orchard Brands, Decker was doing his part to help Warren County.
"In this day and age and the economy going the way it is, Warren has withstood the economic downturn in fairly good shape," he said. Still, "we have been seeing significant layoffs throughout the community. It's very difficult to find a business that is expanding."
"Bringing in 175 new full-time jobs with benefits is huge," Decker said. "It represents almost a 10 percent increase in the labor force at Blair."
The project will help "secure that organization into the future," he said.