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Kimberly-Clark mill deal is off

What remains of the former Kimberly-Clark mill site

EVERETT — The toxic legacy of a paper mill scuttled a deal to turn 66 acres of dormant waterfront into a shipyard as both companies involved couldn’t resolve who should pick up the cleanup bill.
Negotiations recently broke down between Kimberly-Clark and suitor Saltchuk Resources for Saltchuk to buy Kimberly-Clark’s former mill site. The companies announced last week their purchase-and-sale agreement has terminated, but the two companies appear to still be talking cordially.
Saltchuk spokeswoman Emily Reiter said they would need an agreement on terms and conditions for Saltchuk to reopen negotiations.
The breakdown boiled down to who would be on the hook to clean the contaminated soil and nearby water left by Kimberly-Clark’s mill operations.
“Despite the fact both sides worked diligently, they were unable to agree on the allocation of risks and responsibilities related to certain soil stability, seismic and environmental conditions as they relate to Saltchuk’s proposed use of the property as a ship yard and terminal,” the companies said in a joint prepared statement.
“It was fairly straightforward and Saltchuk’s position is it’s Kimberly-Clark’s responsibility to do the cleanup” Reiter said.
Kimberly-Clark spokesman Bob Brand said K-C will be marketing the site immediately.
The toxins are from the nature of pulp and paper processing where Kimberly-Clark and its predecessors operated a Kleenex tissue and paper mill from 1931 to 2012.
A company demolition team last year found higher-than-expected levels of arsenic and cadmium in the debris left from the mill’s buildings.
The waters nearby also are contaminated with wood chips and other contaminants.
Reiter wasn’t sure if cleanup work in the East Waterway would have impacted Saltchuk’s ability to do ship work in the same water. Saltchuk’s shipbuilding arm is Foss Maritime.
The state Department of Ecology is working with Kimberly-Clark to clean up the site.
Kimberly-Clark closed the Everett pulp and paper mill in April 2012 as part of a company consolidation. The mill’s closure put more than 700 people out of work, including many whose families worked at the mill for generations.
The exclusive purchase-and-sale agreement came to much fanfare last October, and the purchase was expected to be signed off earlier this year.
Questions began sprouting this spring when Saltchuk asked Kimberly-Clark for more time for due diligence work on the site.
Saltchuk saw the Kimberly-Clark mill site as perfect for expanding its business, but it’s not in a rush to find a new place.
Saltchuk wanted to expand because the location of Foss Maritime’s shipyard operations in Seattle’s Ballard Locks limits the size of the ships it can work on, but the company grows slowly and strategically, Reiter said. Foss Maritime turned 125 years old this year.
A deepwater port like the one at the former Kimberly-Clark mill site would have been divine.
“We looked up and down the West Coast” for a site, Reiter said, “and we were very excited by the possibilities in Everett.”
Foss Maritime’s arrival would have brought about 250 jobs to the waterfront by 2016.
City leaders hope conversations between Saltchuk and Kimberly-Clark can be revived.
“I am disappointed that Kimberly-Clark and Saltchuk have not yet been able to reach an agreement, but I hold both companies in the highest regard and am hopeful they can resume their discussions,” Mayor Ray Stephanson said in a written statement. “Preserving our working waterfront is important, and I believe a maritime use is a great fit for this unique site.”
The City Council was mum about the announcement Wednesday, April 30.
Council president Jeff Moore said after last week’s meeting that “we’re all disappointed in the announcement today as the partnership that had been developed had seemed right for Everett. We hope the two parties continue to have discussions as they move forward.” 
Natalie Covate contributed
reporting to this story


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