As part of the performance agreement signed between Carroll County, the Carroll County Industrial Development Authority (IDA) and Mohawk, the IDA will pay up to $280,000 toward an $800,000 omniverter that will serve as an industrial power backup system. Mohawk, which employs 154 full-time workers at its site on Floyd Pike, has in return promised to utilize and operate its Carroll County facility for 7.5 years with a staffing level of at least 105 full-time employees.
The talks which led to the eventual decision because of power problems at the plant.
Carroll County Board of Supervisors Chairman David Hutchins said Mohawk’s power problems locally go back several years. In 2006 and 2007, he said county officials were involved in numerous meetings with Mohawk to discuss the power problems and the amount of money the company was losing due to power sags and outages.
“When you see a blink in your lights at home, a flicker, Mohawk has (a problem of over $100,000),” Hutchins said. “It is a huge problem. That is all it takes, a second or less.”
“If your lights blink, Mohawk is down for eight hours,” Carroll County Administrator Gary Larrowe said.
Hutchins said Mohawk asked the county to work with it in finding a solution. He said the county discussed the problem with engineers from AEP and numerous other groups in the area. Hutchins said the solution came in an omniverter system, which serves as an instantaneous backup and filtering system in case of a power sag or outage. Carroll will pay 35 percent or $280,000 toward the $800,000 omniverter, whichever is less. Mohawk will pay the remaining amount of the system, which will cost more than $1 million when the price of installation and upgrades are added.
“While I certainly wouldn’t say that Mohawk was telling us they were going to leave, they had a serious problem with one year, I think it was 18 incidents, which is a million-plus dollars of loss,” Hutchins said. “So we worked with them. I would certainly entertain a motion that we would try to retain employees and employment as much as we would go after new businesses. Job retention is as important to Carroll County and the local areas within it as new businesses. And to those 154 people who work there, this is critical.”
As part of the performance agreement, Mohawk must repay the county’s portion of the omniverter, plus 20 percent liquidated damages, if it breaches any portion of the agreement. Default payments would be set on a sliding scale. The company would repay the IDA $336,000 if it breaches the contract in the first year as opposed to $67,202 if the contract were breached after seven years.
Pine Creek District Supervisor Wes Hurst made a motion for the board to accept the performance agreement.
“It is located inside my district and I think it is a real strong step forward,” Hurst said. “We get to keep an industry in our area and also we get to be in line now for future expansions of that industry. That is a win-win for us and for the citizens of this county.”
Laurel Fork District Supervisor Andy Jackson seconded the motion.
“Having the privilege to go to some of these meetings (with Mohawk), I think this is the best solution we have,” Jackson said.
Fancy Gap District Supervisor Manus McMillian said it’s vital for the county to protect the jobs it already has.
“You don’t want to go out searching to bring new businesses in and lose very important jobs along the wayside,” McMillian said. “You don’t want to overlook an orchid while looking for a rose.”
The board then unanimously passed the motion to approve the performance agreement.
“I think it is a glorious day in Carroll County to allow this to take place,” Larrowe said.
Supervisor Sam Dickson applauded the work of Larrowe and fellow county officials who worked to retain Mohawk Industries, calling the company’s presence in Carroll an uncertainty at one point.
“Without the work of Gary and everybody that worked on it they could be going to Georgia or Alabama, so I commend everybody that worked on it. Even I attended one of those meetings and I left there wondering because it was an uncertainty,” Dickson said. “They were wanting to do something and whether we wanted to be in play or not, we had to react. Mr. Larrowe and the IDA and all the ones involved stepped up to the plate and we appreciate it.”
Mohawk Industries is a Fortune 400 flooring company headquartered in Calhoun, Georgia that employs more than 30,000 people. Mohawk produces residential and commercial carpet, ceramic tile, hard-wood flooring, laminate flooring and bath and area rugs.
Mohawk’s Carroll County facility extrudes, beams and weaves synthetic backing for Mohawk carpet and is consistently ranked as the company’s most efficient backing producer. The company has made significant investments at the Hillsville facility since acquiring it from Wayn-Tex in February 2005.
“We are very pleased to partner with Carroll County on this project,” Jamie Welborn, vice president of manufacturing for the firm, said in a press release. “We appreciate their consideration of the manufacturing challenges that power sags represent for our Carroll County operation. Those sags have cost the plant more than $1 million in lost productivity and waste since 2006. The Carroll County Board of Supervisors and the IDA are to be commended for their pro-business position.”
“We are glad to be a part of the Carroll County community,” said Welborn. “The great people at our Carroll County facility are outstanding contributors to the company’s success, and we know that they will be grateful for the assistance the county and the IDA have provided to eliminate the ongoing problems of power sags, which had created significant obstacles for all of the people in the Carroll County extrusion department.”
Carroll County IDA Chairman Richard Slate said it was critical for the county to assist Mohawk.
“Every time Mohawk had power issues, we were one more step closer to losing them as a great Industry in Carroll County. We had to assist with this long-lasting problem,” Slate said. “Mohawk has never received any incentives from the state or local government to this point and this problem has existed for more than 10 years. We have worked with APCO (Appalachian Power Company) and even the State Corporation Commission to resolve the power issue, however if we wanted to keep Mohawk, we needed to step up to the plate.”