Despite Closing its Canton Mill, NC Company Argues It Shouldn’t Repay $12 Million in Incentives

Source: BPR News

Earlier this month, Pactiv Evergreen, which closed its Canton paper mill last year, argued that it should not have to pay back the full $12 million it received in state economic incentives. 

According to Blue Ridge Public Radio, the company asked a Wake County Superior Court judge to partially dismiss state Attorney General Josh Stein’s lawsuit over the subsidies, which were awarded in 2014 under a Job Maintenance and Capital Development (JMAC) Agreement.

The $12 million state economic incentive was given to Pactiv Evergreen in exchange for a commitment to maintain operations, and at least 800 jobs at its paper mill in Canton, North Carolina through December 31, 2024. 

However, in May 2023, Pactiv Evergreen closed the mill and terminated all its employees — leaving more than 1,000 people without a job.

“Pactiv Evergreen’s closure of the Canton paper mill was a gut punch to our state’s economy and the people of Canton and Haywood County,” stated Gov. Roy Cooper, in a statement last year. “This company broke its commitment to keep the mill open and the state is taking action to hold them accountable.”

In the lawsuit, state Attorney General Josh Stein alleged that Pactiv Evergreen violated several sections of the JMAC Agreement, including the repayment of all funds “if the Company fails to maintain operations at the Facility for the Agreement Term.”

A second section states that “the Company shall repay the Department a proportionate share of Grant payments previously received” if it fails to meet the contract’s requirements in any year after it has received the full $12 million.

And a third section states that a failure to meet the contract’s performance criteria “shall constitute a Default by the Company.”

“Taxpayers in North Carolina invested in Pactiv Evergreen to bolster our state’s economy,” AG Stein said in a press release back in May. “We held up our end of the bargain, and we cannot let Pactiv cut and run away with our state’s money. My office has been working with Pactiv over the last year to address the company’s obligations under the JMAC agreement, but it has become clear that legal action was necessary to hold Pactiv accountable.”

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