NIAGARA FALLS – Chemours’ plans to close its Buffalo Avenue plant in 2016 would not only cost more than 200 people their jobs but could boost the water and sewer bills of every resident and business in the city.
Niagara Falls Water Board Executive Director Paul Drof said Chemours is the city’s second-largest industrial client for water and sewer use, paying about $2.3 million for water and sewer in 2014. Only Norampac paid more – about $5.7 million..
“It’s a significant effect when you have your second largest client closing,” Drof said.
Drof compared the potential income loss to when an annual $3 million contribution from Occidental Chemical ended in 2013, leading to a 6 percent increase for users. He also said he can’t predict how current users would be affected because of improved water treatment efficiencies.
Also unclear is when – or if – the plant will close.
Drof said shuttering Chemours could be gradual or instantaneous. And Niagara Falls Mayor Paul A. Dyster said it may not happen at all.
“Let’s not jump to the conclusion that the plant is going to close,” said Dyster, who added that the owners of the plant have said they are going to remain open through 2016 and that the city and Empire State Development are still engaged in talks aimed at keeping the plant open.
“Whether is it stays open through Chemours ownership or that of another company is an open question,” Dyster added.
The Niagara Falls plant makes reactive metals for specialty chemicals industries, such as pharmaceuticals, pulp and paper. Mark Vergano, Chemours president and CEO, said last week in announcing the closing, that job cuts in Niagara Falls and elsewhere, as well as other cost-cutting moves, would strengthen the company’s financial position, with an expected savings of $50 million a year by 2017.
The announced closing comes just five months after DuPont spun off the performance chemical company, at the beginning of July.
Vergano told investors last week, “We were looking at ‘do we fix, do we sell or do we shut down.’”
Dyster said of the discussions with Chemours, “Keeping a facility open and utilizing its existing equipment is always easier than trying to adaptively reuse a site. They said they are open to selling the plant. We’re going to see if we can help facilitate something they couldn’t do on their own.”
But Drof said if Chemours closes the Water Board would need to make up the loss of income, with water users absorbing the impact.
“Those costs that we cannot reduce, those fixed costs, will have to be redistributed to the remaining users. That’s why people are hopeful they will find a buyer for the facility,” Drof said.
He added, “If we cannot find replacements or new industries do not pick up that slack we would have to distribute that loss. In effect the rates will probably go up.”