The Hard Facts About Losing Unilever

As great as is the loss of a cornerstone of the town’s economic foundation, the closing of the Clinton Unilever plant means the end of a 120-year relationship with one of the community’s most admired members.

The looming, light yellow art deco-style plant on John Street has been a dominant fixture of the Clinton landscape and of community life, and an integral part of town history.

The announcement last week that Unilever – the town’s second largest taxpayer, with $22.1 million in 2010 – shocked town and community officials all the more because it follows by a year the closing of the Stanley Bostich plant, also one of the town’s top ten taxpayers.

And it raises concerns about the 2012-13 budget, after this spring’s bitter battle to win approval of the new town and school budgets, with opponents urging their defeat while town and school officials warned over and again that the reductions were going to make the following budget even more difficult.

Finance board Chairman Brad Sullivan said he expected the closing would be a topic of discussion by the board members. “It’s really terrible … I’ve been getting a lot of emails from people concerned about how it’s going to impact next year’s budget,” he said.

Despite the shock of the news, town officials were not entirely surprise by the decision. Unilever came close to shutting down the plant in 2000, when the personal care products giant cut 10 percent of its global workforce and closed half its 250 plants.

Since then, Unilever has closed its distribution warehouse on Route 145 and, in 2006, moved its logistics operation center from Clinton to a sister facility in Trumbull, reducing the company’s Clinton workforce from 500 or so in 2000 to the current 49 salaried and 135 hourly employees.

First Selectman William Fritz said he “had no clue” the company would announce last week that the Clinton plant was being shuttered and production of its products – Vaseline Petroleum Jelly and Pond’s and Dove personal care products among them – would be switched to other plants.

“We’ve all heard rumors (that the plant might close) but when you’ve spent $3 million on your plant over the last few years, it’s kind of a surprise,” he said.

And Doug Traynor, a finance board member who also serves on the Economic Development Commission, said the closing “was a surprise, but if people thought about it, it was kind of obvious it was going to happen.”

Fritz said he had spoken to Unilever officials and been assured that the closing has “nothing to do with the local government, or with the taxes in town. It’s basically a consolidation of operations.”

“We’ve always had a good relationship with Unilever,” he said, praising their financial and personal participation in a variety of civic endeavors over the years.

Fritz said the closing of the plant may have more to do with the state’s economic situation, and said state officials need to be more pro-active in keeping businesses in small towns. “I have a hard time with CIGNA getting $70 million from the state to bring 200 employees from Philadelphia to Bloomfield, while we’re losing two of our biggest businesses. The state needs to step up.”

With a massive loss in value for the town’s Grand List from the most recent revaluation of taxable real estate, any loss of tax revenue is a major concern for Clinton. But Fritz said the impact on tax revenues will not be as severe as initially feared. Clinton will lose $55,000 in personal property taxes, but Unilever will be obliged to pay some $190,000 in real estate taxes on its 28-acre plant property and distribution center.

“The bigger blow may be to the local economy,” he said, with Unilever employees no longer patronizing local businesses. Roughly estimated, Fritz said that could amount to a $200,000 annual loss for the town’s economy.

Fritz also said he had no indication from company officials that employees were going to be laid off. “They said nothing about layoffs. When they moved the logistics office, they offered employees jobs in Trumbull or South Carolina, or retirement.”

While their jobs in Clinton are being eliminated Unilever representative said it would be “premature” to discuss the employment future of Clinton’s employees with the company. Unilever remains committed to its Trumbull operation, where it has 900 employees, a company official said.

The Clinton plant has its roots in the purchase 120 years ago of the Whittemore soap factory by “Pond’s Extract,” a company that produced a balm through the distillation of the witch hazel plant. A 1955 merger created the Chesebrough-Pond’s Co., which grew into a leading producer of personal care products that was purchase in 1987 by the Anglo-Dutch giant Unilever.

According to the 2010 Grand List, the town’s top ten taxpayers (and their assessed value) include:

Chelsea GC Realty Partnership (Clinton Crossing), $42.73 million

Chesebrough-Ponds (Unilever), $22.11 million

Connecticut Water Co., $16.69 million

JMH Associates (Stop & Shop property), $8.4 million

NPNC LLP (Shoprite commercial property), $7.9 million

Connecticut Light & Power, $7.7 million

CIM LLC (Cedar Island Marina), $4.9 million

Hammocks Development Co., $4.79 million

Kent Home Assoc., $3.57 million

MJM Self Storage of Clinton, $3.22 million