Wow this has been an active credit since 2005? Too bad Domtar just started earning the credit now. Is it retroactive?

does this change anything w/ the future of domtar?

This is more sick legislature. It makes no sense whatsoever to fund an industry that cannot compete globally & faces inevitable extinction. The money should be spent to fund the tech sector, an industry this country can compete in globally or fund infrastructure, an industry that puts thousands of people to work. Millions have been given to the paper companies & they still continue to fall one by one.

Washington / Augusta is sick & broken.

Interesting to see how one good move from the Government (easing taxes) could play a role in making an important Maine Industry quite viable again for using improved technologies like they have been for years.

Hey Sledman, I think you missed the point. Of course the transportation committee nevert saw this coming, but the fact remains that in all the world, we live in a state that has vast forestry resources and paper requires wood pulp so the rest of the largely treeless world needs what we have to offer. That being said, we need the kinds of innovation that have been used in this industry for many years. I operated biomass boilers for many years that were fueled by the wood wastes that were produced by the wood/lumber industry producing millions of dollars worth of electricity annually. The old sawdust heaps rotting away in the woods are a thing of the past. We all need to be resourceful and use our waste/byproducts more efficiently.

Hey Mr. Sledman,

.....sorry I hit the wrong button, but you sure hit a button with me. If we all had the negative attitude you had then we would be a third world nation by now. The printing paper industry may be dwindling but paper is being used for than just printing. Try to research a little more before writing Maine's Paper Industry's Obituary.

How long does it take a tree to grow in Brazil? A fraction of the time it takes in Maine. How much does it cost to harvest a tree in Brazil? A fraction of the cost it takes in Maine. Putting aside for the moment the complex issues of unions, politics & corporate greed, Maine is at a disadvantage geographically speaking. If the domestic paper industry was viable, it would not continue to collapse, period. Govt should absolutely assist business that has a future, the domestic paper biz does not. This is logic, not negativity.

As far as doing research, how much more proof do you need? Again, if the domestic paper biz was viable, it would not continue to collapse.

Millions & millions have been wasted funding paper busineses that are going under. Throwing more millions at them can't save them, sorry but that's reality.

Sledman,

You are correct in that trees grow faster in Brasil than they do here in Maine, I am sure any 5th Grader could tell you the reason why, so I won't ask you if you trhink you are smarter than a 5th Grader lol. However, this is in fact a small piece of why we here in America cannot compete with foreign countries and it is not just in the Paper Industry. The biggest reason is compliance regulations set by the State and Federal Governments and Maine always tries to be tougher than the Federal Government and any other State Government.

Not only do our Companies have to put Billions of Dollars into the equipment to be able to comply with these Regulations they also have to pay fines in the many thousands of Dollars if they are found in violation at any given time, and these facilities are being monitored by sattelites. If they do violate these regulations they have a period of time to report i,t and if they don't make it in time they get fined for this too. This is just some of the reasons why we can't compete there are many other laws and regulations like on Licensing Dams and many others.

These Other Countries regulations, that we have to compete with, are in most cases nonexistant or not enough that would matter.

This tax credit was a loop hole that was in effect only to the end of 2009 and when it was announced it we would be going down on May 5th it was suggested that we point this fact out to our Senators and the Governor of Maine.

There are many regulations that hurt many industries in our State and Country, and though the Companies recognise the reasoning behind this, they are asking for the Government to see the fact in trying to compete with foreign Countries who could not care less for the enviorment.

We are going down for these reasons and unfortuately the workers are being used as chess pieces in this game between big business and Government.

I believe I have asked you before, but I can't remember if you replied, so I will ask again. What business do you own or work for that you feel you are so much more secure in your job than the rest of us do in these times?

If it is an IRS tax credit they can go amend the last 3 years worth of returns and get the money that they are entitled to.

John buddy,

What I do for work is none of your business.

Your Montezuma's Revenge of the hand is all well & good. But the fact remains, millions of taxpayer dollars have been spent on an industry that cannot compete globally. The reasons the industry cannot compete are numerous & varied but when all's said & done, the industry cannot compete.

I hope you are a working man. I will appreciate your generosity via unemployment when I get laid off in July.

Jennifer sweetie,

What do you know about the paper industry?

Are you a papermaker?

Does it matter if I am a papermaker? Didn't realize I had to be to answer a question about taxes.

Jennifer,

Hottubherbie isn't the least bit interested in your papermaking or tax accounting skills. He's been offering the ladies "stimulus" payments to join him in that cesspool hot tub of his.

Wow! Imagine that! A benefit for the Paper Industry in Maine that is actually helping some of the Maine mills whether this horrific economy so that they can emerge on the other end and continue to provide jobs for Maine citizens (with paper grades that ARE competitive being made in Maine, Sledman).

I guess we ought to rip the rug out from under these viable few mills left and let them die rather than give them a fighting chance. Perhaps we can give the money to the auto industry or some bankers, who really know how to conduct business.

There will always be a cheaper place to do business in ALL industries. This loophole is good and should continue. This will help make up for all the environmental costs that has been taken on by US companies and not a lot of the ones overseas. We should do more of this to keep manufacturing jobs here. The analogy used above about competing globally is flawed. We/government decide who can compete and what industries will get funding. The truth is there are many countries that are cheaper to make paper, wood, oil products, cars, tools, chemicals, houses, campers, tech products, engineering, movies, clothes, pets, financial products, ethanol, news, pools, and food on and on and on. And the sad truth is that they are all slowly moving away because there is always a cheaper place to do business. So it all depends on what industry we/government feel we should keep. So I say the paper industry is not getting enough representation and if this money is there for them more power to them.

My first thought of Jennifer was that she is an accountant or a tax professional, or maybe she works in a corporate office? Or maybe she's just one smart gal. Maybe she's full of it. Who knows?? Anyway, I'm sure the paper companies aren't getting their tax advice from the BDN comments section.

Sledman does make some valid points, but what he failed to mention was that trees often do not regenerate naturally in the tropical region. Planting is capital intensive, and then there is the whole "save the rainforest" coalition. Here in the temperate and boreal forests the trees generally grow back naturally, at no cost to the landowner. Granted, they grow back slower, but naturally without manual planting, and Maine does not experience the chronic erosion problems and soil depletion that plagues timber harvesting within the tropics. And it seems as though we all have axes to grind these days. "The money should be spent to fund the tech sector" is Sledman's way of saying that his ax cuts deep into the technological sector. I have no problem with that. Just don't bury an entire industry and plant another on top. And I agree, DC and Augusta are broken. For that I have no solution. Well, I do, but it's probably illegal and may mimic the actions of 1776.

Also, like any other industry, the market will dissolve the weak and the strong will rise to the top. Is the pulp and paper industry the only industry that does not appear viable during these trying economic times? I think not. IBM here in VT have been laying off workers. So have the service industry and the retail industry. To say that the pulp and paper industry in Maine is not viable is a bit of an overstatement. The cyclical nature of the beast will leave the strong companies standing in 2010 to face improving economic conditions and will spit out the weak like a chipper eating a tree. Maine may have to close some paper mills, but how about reworking the mills into co-generation plants, a la Millinocket and other shuttered New England mills. There are alternatives and Maine does harbor high volumes of low grade timber to feed the alternatives. The socioeconomic stratum of the industry may suffer from some lost jobs and different price structures for raw product, which will affect the logger, trucker, etc., but the industry as a whole will be stronger because of it. In the end, we will have our most efficient producers and smartest businesspeople left standing.

Maine can compete with the global market for pulp and paper. The mills will continue to figure out ways to lower costs, especially energy costs, and increase efficiency. And forestry companies are continually experimenting with faster growing species that can be harvested for fiber on 20 year, or less, rotations. And tax credits don't hurt either. But don't associate Maine's forest industry with AIG, etc. This is an energy issue and not a bailout. Also, what's the alternative cost, in dollars and to the environment, if the mills did not burn the liquor for energy?

And to address Mr. Dutton's concern, the U.S. and Canada have been playing the tariff/tax credit/subsidy game for over 100 years. More specifically with the softwood lumber industry, but it obviously applies to the paper industry as well. If the Crown wants to own vast amounts of land instead of privatizing land ownership and thus changing stumpage and price structures, then the Canadian Govt. will continue to cut their own throat and continue to hold their forest industry over a barrel. And I find it ironic that Mr. Dutton speaks of "artificial pulp costs", given the Canadian Govt's propensity to dole out sawmill subsidies and bailout failing sawmills, thus creating unfair market conditions for the U.S. competitors. Every industry needs continuous innovation. And in this global market we cannot afford to wait for the neighbor across the border to catch up.

Ed - former inhabitant of the great State of Maine, current manager of NH and ME forests

Thanks EdVermont33! I don't expect that paper companies are going to be banging on my door to file their ammended returns for this credit. I have gone and re-read the article many times and it does sound like the IRS has to certify eligibility for this program and it also sounds as if the IRS processes the refund. There could be stipulations that there is no going backwards after certification.

With that said if the IRS owes a refund there is no late filing penalty fi you are due a refund and haven't filed. BUT you have 3 years from the original due date to file a tax return and still get a refund of the monies owed to you. It is the IRS's statute of limitations for claiming a refund!I

Sledman,

I guess you're right, your job is none of my business, and as my company is laying me off in May I will be unemployed before you, but if there is anything else I can do to help you, let me know , I will if It is at all possible.

In case you haven't noticed very few American companies can complete Globally. I hope your sled is a hand sled, as the way our Government is Governing this country, I am sure, unfortunately, you will also join the ranks of the unemployed in time.

John,

Irregardless of our differing opinions & seriously, good luck as you are correct, our govt is dropping the ball big time.

Sledman

John Phelps, as a young retire from the paper industry here in Millinocket, I cannot help but support your reasoning one hundred percent. Yes I witnessed the tall stacks being built. This construction set in place to comply with regulations, so that the town of Millinocket could come out from under a cloud of yellow that would settle on the town. The sulfur heavy air that emanated from the pulping process would escape from the cooking system, it would engulf the workers and then saturate the air for miles around the mills. While working at the mill for thirty years the average mill worker learned about the paper making process, and more. We learned that the fiber that takes a few years longer to grow here in Maine is sought after all over the world. The reason Maine trees are exported to offshore machines is that the longer heartier fibers make better paper. Another benefit of working in a paper mill is that an average worker becomes acquainted with the ever-changing world. This from years of training on state of the art computer monitored systems. This kind of first hand experience, in the arena, of the real world has experienced workers recognize that although there are many changes going on in the world, indeed there are changes in the news print media, as well as there are changes in just about every media. In spite of all the turmoil of these dynamic changes the manufacturing and consumption of paper probably has not reached its demise. Example here in Millinocket the town paper has ceased, the major newspapers have shrunk, we get most of our news on-line. The stores along the main street have almost ceased to exit so shopping as we new it is almost non-existent. Yet each week the amount of paper being hauled to the dump increases due to on-line shopping and the catalogs this generates. So I believe if there is a recovery in the future, paper will be at the center of it.

I wonder if a mill that is going idle, possibly close will use this money they recieve for 2009 to pay employees' severence pay or aid with insurnace? If the mill closes, too bad the money just goes to corporate??? Oh maybe there are some bonus that need to be paid to corporate managers? Oh maybe the mill cannot close for a certain period after receiving one of these payments? Hmmmmmmmm. I just cannot help but feel GREED is the biggest issue today..

This retire former millworker at Great Northern was sailing around the chain of lakes here in Greater Katahdin. I had the great pleasure to introduce a friend to our sailboat captain and host. This was my introduction: “Bob is now a retired engineer, while Bob worked at the Great Northern Paper Co. Bob was the head engineer of a system that I worked on for most of my thirty years at Great Northern. The system that kept me gainfully employed for most of these years was a multi-fascinating system. The process would cook woodchips in a six story pressure-cooking kettle. The finished pulp would be used in the paper making process; meanwhile the liquors and the gases would be captured. The containment process would capture the chemicals and the sugars extracted from the pulp, meanwhile this process would be a recycling system that recycled nearly all the chemicals used in the cooking process, as the gases and the red liquors were being refined to be burned in a boiler”. During this introduction this writer stated that “someday perhaps twenty years from now, the rest of the world will be re-discovering the science of recycling and fuel generating that we in Millinocket were working on twenty years ago thanks to Bob”. I told of the disheartening fact that the Fraser management team had conspired to dismantle this multi-fascinating, multi-faceted system. The sole reason for this destruction was to sell the miles of stainless steel pipe and other facets of resalable machinery. The pilfering of this junk was nothing of the true value of the components that were made off with. Bob while acknowledging my compliments simply stated that the men that had dismantled this system were very much a disappointment to him.

What? Maine paper mills getting a tax refund? Something must be wrong.

Why that money should go to GM = Government Motors, so their C.E.O.s can get Millions in bonuses, right?

.

I can hardly wait for the Al Gore-designed 2010 Pelosi Mobile !

.

All joking aside, I don't understand the paper industry decline.

I mean with the westernization of the middle east, shouldn't making T.P. be a growth industry?

.

The one point that is missing is that the FED has been handing money hand over fist to all kinds of buisness and industries for years,farmers are paid not to grow crops as an example. The paper industry in Maine not only is faced with global pressures but a heavy handed State government that has gone NUTS at times. Don't get me wrong holding industry accountable for environmental regs. is not a bad thing and for the most piont the industry has cleaned up it's act. and has spent millions of dollars to do it instead of putting those millions into new equipment. So when I hear "the paper industry in Maine is dieing just what dose that mean?............. For every 1 paper mill job it suppoerts 4.5 other jobs out in the community do the math ................. adds up quick dosn't it. For every 100 mill jobs lost 450 other jobs are lost to. That's 550 families who can no longer spend money,or go to the store,send there kids to college ect. I know this is over stated but you get the picture. Like the paper industry or not thousands of families in this state count on it for a pay check to live, pay taxes and try to have a better standard of living than the last generation did. So if the FED wants to give us a tax break YAHOOOO can I have another please and just as soon Augusta gets it's collective head out of it's &*&^& and stops grovling to the Trust funded treehugging barking imported moonbats that insists on turning our state into a park the better off we'll be.

andre40: Overstated? Hardly. You're absolutely right. Anyone who spent any significant amount of time living or visiting Millinocket in the papermill's "heyday" can tell you just exactly what a shell of a town it's now become. Younger generations apparently have absolutely no clue. What's up there now? A Family Dollar Store, a Hannaford, and a strip club? Far cry from years ago when it was a fully functional town. Oh sure, people like to complain about greedy workers who have all of the "toys" etc...but let's not forget everyone who benefitted from all of the money they spent. Besides, it's Millinocket - rural...outdoor recreation is pretty much it up there. There's a lot more lifetime workers who got the shaft when Bedard took the money and ran then "greedy" workers who took advantage of union "perks."

I am former papermaker.

It is hard to say, "calm down" to most of these commenters. it is hard to be cool-headed in face of lost jobs, lost industries. Compared to the handouts to crooks and sneaks (Wall Street at least $750 BILLION and counting) and morons (Big Automotive at $20 BILLION and counting), this tax credit is NOT as obscene in pure dollar terms. I will grant you that.

But there are TWO big problems with saying, "everyone else is getting tax dollars, why shouldn't we?":

1. this particular tax credit was supposed to be a reward for doing the right thing envioronmentally speaking. Carbon footprint, and all that. But it's wrong. The tax credit is paying mills to do what they have always done in a Kraft pulping process. They couldn't make paper economically if recovery boilers didn't burn black liquor to recover pulping chemicals and generate steam. Sure, its biomass, but according to that logic you would be making cars in order to get scrap metal to feed steel mills.

2. When the annual tax credit almost EQUALS the market capitalization of the companies, then the government incentives are completely upside down.

If a company, or industry, cannot survive without a government (taxpayer) subsidy which in dollar terms equals the potential profits from actually making the product (in this case paper, pulp, linerboard) then something is wrong.

99david - I am a papermaker as well. And I fundamentally agree with you.

But.....

let's talk about solar power, wind power, hybrid auto power - none of which make any sense at all without government subsidies.

While Im glad if these new alternative fuel tax credits help keep our paper mills alive, I still say it's not too late to give Industrial hemp a try.

We could have a experimental run with one of the mills that have closed down. We could make the paper with Canada's Industrial Hemp till we can grow it here. We could fuel the plant with biomass from trees using the interesting process that I read above here, and use the hemp for the paper products. This way we'd be helping the farmer that grows the hemp, and the lumerjack that cuts down the trees, and provide Maine with much needed jobs.

But either way, best wishes to the paper/pulp manufactors, may you thrive and prosper and provide jobs and revenue to the state.

"fuel the plant," I mean fuel the mill. opps

apapermaker.

You are correct. Alternative energy approaches - solar, wind - currently receive subsidies as well. Saying "they don't make sense" is true - as in "these technologies are not as economical in cents-per-kilowatt term" to the consumer. So the govt. tries to "help" the industry (say wind turbines) improve its manufacturing scale economies by providing a $ incentive to increase demand. The hope is that better scale economies will add efficiency and reduce costs to the point where an alternative energy source is "competitive" with "bad, bad" fossil fuels. Again, there isn't enough space in my PC hard drive to understand, much less explain, the whole carbon/global warming thing. I will just say that energy subsidies are more like the old (and present day) highway subsidies, and the old railroad subsidies - the government is using tax $ to "push" society in the direction it THINKS society ought to go.

They were right in rail, debatable in highways, and I THINK they are right in alternative energy (trying to get us away from huge dependence on offshore oil). But they are not "right" on black liquor "subsidy". The sad part is that the government didn't even WANT to be - that is, they had no idea the IRS rule would be highjacked like this. And neither did the paper industry, by the way. A wheeler dealer charged a few Maine mills big bucks to show them a few sections of the IRS rule, then it spread like wildfire to the rest of the industry, which now realizes it has a bad PR problem on its hands.

Anyway, good point apapermaker. I think we both agree on the basic merits of the issue this article raises. Sorry if the shutdowns impact you directly.

HOW ABOUT MAKING FOREIGN IMPORTS ABIDE BY THE SAME RULES THAT AMERICAN COMPANIES DO? FREE TRADE AND FAIR TRADE! AMERICA CAN COMPETE. RAINFOREST CLEARCUTTING AND COMPLETE DISREGARD FOR SAFETY IN FOREIGN MILLS CANNOT BE TOLERATED. ENVIRONMENTAL ABUSES ARE RAMPANT OVERSEAS AND YET OUR POLITICIANS MAKE LITTLE OR NO EFFORT TO LEVEL THE PLAYING FIELD FOR THE USA. GLOBALIZATION WILL NEVER WORK BECAUSE OF RISING TRANSPORTATION COSTS, SO STOP PUSHING THAT TIRED OLD IDEA. BUY LOCALLY MAINE MADE WHENEVER POSSIBLE. PLASTIC BOTTLES MADE IN CHINA, FILLED WITH WATER IN FIJI AND SHIPPED TO MAINE TO BE SOLD MAKES NO SENSE.

Foreign aid, overseas aid, monies going to subsidized developing countries, all this money was not intended to be used against American workers. However that is exactly what has happened. Foreign competition the irony is that even with the trillions now being spent to bail out our economy it will be years before the U.S. government equates what it has sent over to such countries as South Korea, ala Hyundai, or Indonesia ala Bowater Paper. These subsidies to these countries have been used to finance what we now call our foreign competition. Before Maine becomes a third world country let’s tell Washington that we are worthy of the same type of treatment as these foreign financial institutes.

That's what I'd like to know, how does this change the direction of Domtar now? What happens if Domtar files bankruptcy and stills plans to shutdown closing up business, is it safe to say they will get their tax credit monies and run? Maybe someone should look into this further, jobs and the ripple effect of Domtar are extensive and will cripple Washington County residents even further.