RICHMOND — Virginia Gov. Terry McAuliffe (D) was just six months into his term when he snagged a huge economic development coup: a Chinese firm unveiled plans to build a $2 billion paper plant that would create 2,000 jobs in the Richmond suburbs.
It would be a green manufacturing operation that would churn out paper without the use of trees or bleach, whose only byproduct would be organic fertilizer.
Since it was announced with great fanfare in June 2014, the project has faced repeated delays, some of them related to land acquisition. The company has yet to begin construction or apply for necessary permits. Two top executives have left in recent months.
Now parent company Shandong Tranlin Paper Co. says it will “adjust its business plans” for the prospective Chesterfield plant.
The reason for the latest delay sounds like good news for Tranlin: A new technology that the company has been testing in China is working so well that the firm wants to rethink how it approaches manufacturing elsewhere.
In the long run, that could mean a future Virginia plant will be all the more advanced and efficient. But at least for now, it means another delay for what remains McAuliffe’s single-biggest economic development deal.
“We’re looking forward to meeting very soon with Tranlin executives to make sure we have a clear understanding of the delay and the new time frame,” said Todd Haymore, McAuliffe’s secretary of commerce and trade.
Saddled with a Republican-controlled General Assembly opposed to many of his policy goals, McAuliffe has focused his governorship on economic development. It’s a goal with bipartisan appeal, one the governor has been largely able to pursue without the legislature’s input.
The Tranlin deal stands out for its sheer size, but it is just one of 927 struck since McAuliffe took office in January 2014. Together, he has secured $15.9 billion in capital investment. That is far more than the investments pledged under Virginia’s past three governors, McAuliffe’s office said. The closest was his immediate predecessor, Robert F. McDonnell (R), who at this point in his term had attracted $11.8 billion.
The original Tranlin plan called for an 850-acre campus in Chesterfield County, just south of Richmond. There, Tranlin said it would use cornstalks and straw normally left in the field after harvest to make paper. That would create a new cash crop for area farmers and make for more environmentally friendly paper products, such as toilet tissue and paper plates. The residual plant material left over after production would be turned into organic fertilizer.
The project was eligible for $31 million in economic incentives, but the company was required to reach certain investment levels first. The firm has received just $5 million so far to obtain land for the project.
Tranlin issued a brief news release last week that announced the delay.
“Tranlin Inc.’s parent company, Shandong Tranlin Paper Company, Ltd., is currently starting up ahead of schedule its newest pulping, paper making and biostimulant fertilizer manufacturing facility in China,” the statement said. “This facility demonstrates Tranlin’s most advanced, proprietary, Third Generation technologies, machinery and processes. Early indications from performance testing show that there will be significant efficiencies that will impact all aspects of Tranlin’s U.S. business plans. The company will review these learnings and adjust its business plans in the U.S. accordingly. Tranlin Inc. will be redeploying some resources to assist with research.”
The statement did not say how long the Chesterfield project is expected to be delayed.
Tranlin spokeswoman Lisa Randall said Monday that the company has so far purchased about 58 acres of the land, but holds an option on a larger tract.
“We have hired third-party consultants who are conducting environmental surveys and field studies at the project site,” she said. “This work is underway, and the results will be used in support of the permit application processes.”
An earlier version of this report gave an incorrect value of the capital investment that former Virginia governor Robert F. McDonnell (R) had attracted at a comparable point in his term. This story has been updated.