‘I can’t even imagine what things might have been like without those 800 jobs.’
It was “The Business That Must Not Be Named.”
For months, consultants for an anonymous out-of-state company appeared in Lewiston. Men in suits examined the city’s industrial spaces, teased about making big investments in a new warehouse facility and flew away in chartered jets.
Curious city workers eventually discovered a clue to the business’ identity by tracking the tail numbers on the consultants’ jet.
The plane hailed from Arkansas, the home of Wal-Mart.
Even when the consultants confessed who they were working for, secrecy followed, said Phil Nadeau, Lewiston’s deputy administrator.
City officials hatched their own cloak-and-dagger tactic to help keep Wal-Mart’s identity hidden until the retailer was ready.
They created a code name: “Project Quality.”
Today, it sounds silly, but at the time it was part of a serious effort not to sink a project worth tens of millions of dollars by speaking too freely, Nadeau said.
“We’re talking about 800 jobs,” he said. “Anything we do that upsets the balance of their negotiations terminates the negotiations and we lose the project.”
In December 2004, the once-secret company etched itself onto the local economy and the Lewiston landscape. Workers broke ground on the massive Wal-Mart Distribution Center in south Lewiston.
The project became one of the biggest in the state’s history, requiring 5.7 trillion pounds of earth to be moved before construction began on warehouse space that would eventually surpass a million square feet, roughly 20 football fields.
The city now estimates the total value of the facility — including land, buildings and contents — at more than $75 million.
Even more substantial to the community are the jobs, estimated by city officials at 800.
Wal-Mart’s jobs and taxes eased the effects of the 2008 recession on the community.
“I can’t even imagine what things might have been like without those 800 jobs,” Nadeau said.
It has been a nearly perfect development, he said.
Though it earned millions of dollars in tax breaks, Wal-Mart has also paid millions of dollars in taxes to Lewiston. Meanwhile, wages paid to warehouse workers in Androscoggin County rose from a total of $5.3 million in 2004 to more than $26 million in 2012, according to statistics from Maine’s Center for Workforce Research and Information.
“Wal-Mart delivered exactly what they promised,” Nadeau said.
Quiet company, resounding impact
The retailer’s sprawling Alfred Plourde Parkway complex is both extraordinary and utterly bland.
All that can be seen from the road is a cluster of white boxes, loading bays, a labyrinth of ducts and pipes, and row upon row of parked tractor-trailers.
The extraordinary part is its scale. Though it sits alternately above and below the grade of the winding public road, preventing a complete image of the facility to uninvited visitors, it dwarfs everything nearby when seen from afar — such as from the northbound lanes of the Maine Turnpike just south of Lewiston.
The Sun Journal made numerous requests to Wal-Mart for a tour, interviews and other information for this story. All were ignored. But much is known about the facility and its impact.
The Lewiston plant is one of 158 such facilities in the country, according to the Wal-Mart website. Only three centers exist in New England. The other two are in New Hampshire.
Each is larger than 1 million square feet, containing up to 12 miles of conveyor belts moving 5.5 billion cases of merchandise. According to the website, every distribution center supports 90 to 100 stores in a 200-mile radius.
Though Lewiston has other large companies, including Central Maine Medical Center and TD Bank, that employ more local people, the Wal-Mart distribution center accounted for the largest single expansion of jobs and investment in the city since the creation of the mills more than a century ago, said Lincoln Jeffers, director of Lewiston’s Economic and Community Development Department.
In return, Wal-Mart asked for a lot.
Only a week after the company was identified publicly, the Lewiston City Council approved a 20-year tax-increment financing (TIF) deal that split in half the real estate taxes that would be collected from Wal-Mart.
Half of those taxes would be used by the city for infrastructure and economic development initiatives, including changing the path of Alfred Plourde Parkway, installing a new Central Maine Power substation and adding a pair of water tanks that boosted the water pressure to South Lewiston.
The other half would be returned to the company.
The distribution center land now is valued at $1.6 million, according to Joe Grube, Lewiston’s chief assessor. The buildings are valued at $48.2 million. And their contents are valued at $25.5 million.
Between 2005 when the plant opened and 2013, Wal-Mart paid $12.2 million in real estate taxes. Of that money, $5.75 million was returned to the company as part of the TIF deal.
The city also collected almost $5.9 million in personal property taxes assessed on the buildings’ contents, all of which went to the city — half of it going to economic development initiatives.
The other half, $2.8 million, went into the city’s General Fund.
It’s precious money in an era when municipal budgets are exceptionally tight.
But the center’s most significant influence has been the wages paid, and the ripple effect of those wages in and on the local marketplace, said Jeffers.
Wal-Mart began hiring people — including many with no post-high-school education — at a rate of more than $13 an hour.
Interest was so high in the jobs that the Maine Department of Labor’s Lewiston CareerCenter opened its doors on Saturdays for three months to give Wal-Mart personnel a place to question potential workers, said Mary LaFontaine, the center’s director.
It prompted other businesses to raise wages, too.
“It set a new bar if you had good people and you wanted to hold on to them,” Jeffers said. “Guys who used to make $8 or $9 an hour were making $12 or $13 an hour.”
It also kicked open a door in the marketplace.
The distribution center’s revenue helped launch an industrial park, across the street. A list of businesses, including Cianbro, tire wholesaler Max Finkelstein, Baxter Brewing and Cash Energy, occupy space in the park.
There, too, land values rose.
A piece of land that sold for $5,000 an acre before Wal-Mart went in might go for $20,000 or $30,000, Jeffers said.
However, some nearby parcels never went the way the city hoped.
A ‘game-changer,’ a life-changer
One effort to capitalize on Wal-Mart’s investment — creating nearby retail space — came to a screeching halt in 2008.
The sour economy led Wal-Mart to back out of a plan that would have seen construction of a new supercenter anchoring a new development near Exit 80 of the Maine Turnpike.
“We were so close,” Nadeau said.
Five times, Wal-Mart officials had heard and approved the plans that would have situated the development on the Challenger Drive site now occupied by a VA community-based health clinic. But as the economy suffered, sales slowed and the retailer reduced expansion plans nationwide.
However, city officials hope that another retail plan might yet emerge. David Gendron of Gendron & Gendron, the owner of the nearby industrial park, also owns most of a tract of land adjacent to the turnpike, near the northbound on-ramp.
If the right offer arises, the image of lighted store signs visible from the highway — such as developments on Route 295 in Topsham and Route 95 in Augusta — might happen, Nadeau said.
Changes to the exit, completed this year, include easing the highway ramps and modernizing the lights, he said.
Nadeau poked fun at the old interchange and its single blinking light.
“You come to a stop and wonder, ‘Where’s the city on the signs?'” he said. “It was terrible.”
Gendron, who did not return calls from the Sun Journal, plans a second phase of his industrial park, Jeffers said.
The project has already received tax breaks from the city, he said.
To LaFontaine, the distribution center’s primary impact is continued jobs. Her office works with prospective employees on a weekly basis.
“They have very good jobs, great wages and hire a lot of people, all really good things,” LaFontaine said.
Todd Day, who manages the Max Finkelstein location in the Industrial Park, said he cherishes the ability to stay in the area where he grew up.
Originally from Auburn, he left the area to work, and jumped at the chance to follow a job home, he said.
He now lives in Lisbon. And a son works at Wal-Mart’s distribution center.
“He’s right over there,” he said, nodding toward the complex about a quarter-mile away.
It’s the kind of impact, said Greg Mitchell, who served as a deputy city administrator when the Wal-Mart deal happened, that can be forgotten amid the talk of millions of dollars, utility changes and tax breaks.
Though he now serves as the economic development director for the city of Portland, the Wal-Mart deal was likely the biggest of his career, he said.
“It was definitely a game-changer in the community,” Mitchell said. “I don’t know that people today understand that or appreciate it. It changed people’s lives.”