The economic slowdown and tight credit market in 2009 had an impact on at least three local industrial projects, Mike McCain, executive director of the Gadsden Etowah Industrial Development Authority, said.
“Nationwide project activity in 2009 was at an all-time low,” McCain said.
He said that was because markets dropped for products because many consumers could not obtain financing. Corporate credit lines also were cut, reducing funds for capital investments.
McCain said uncertainty about future tax and possible increased regulations is causing some companies to take a “wait-and-see attitude” about investing in the United States as they look for possible offshore investment opportunities as well.
“Nationally, it was horrible,” he said. “In Gadsden, it could have been a whole lot worse.”
McCain said he didn’t see any significant improvements for 2010 unless there are changes to ease up credit availability and resolutions to such issues as health-care reform, “cap-and-trade” issues involving carbon emissions and tax and regulatory issues “to ease the uncertainty in the minds of a lot of companies that are deciding where to invest their money, either here or overseas.”
But McCain said he is more optimistic now than he was a year ago.That is because the unemployment rate is declining and because of having two prospect visits scheduled for January.
“That’s a sign of encouragement,” McCain said.
McCain said Rigid Building Systems, which opened in 2007 in Gadsden, was adding employees last year when the credit crunch hit. The company manufactures metal buildings.
With its customers not able to get financing to buy Rigid’s products, the company was forced by its out-of-state bankers to close the Gadsden facility while continuing operations at its facility in Houston, Texas, McCain said.
McCain said two other industrial projects did not materialize because of financial problems.
He said a company purchased the former Packaging Integrity Building and planned to hire 150 to 200 people, but could not get financing for the needed machinery. Another company made an offer to purchase the former Custom Panels plant and would have hired 80 to 100 people, but could not obtain equipment and working capital financing.
McCain said there is a possibility one of the projects might occur this year if financing can be obtained.
By Andy Powell
Times Staff Writer