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Can Wisconsin Rapids Reinvent Itself Once Again? What’s Past Is Prologue

This and other transcripts on this site have been provided by a third-party service. The video replay should be considered the definitive record of the event.

STEVE KEUHL: Our purpose is to bring together civic leaders, community and economic development professionals, expert researchers, Chicago Fed staff, and concerned residents. Through these diverse perspectives, Project Hometown examines how our hometowns can recover from the pandemic, overcome longstanding inequities, grow stronger, and provide all people with the opportunity to thrive.

Today's event actually has special significance to me, because I grew up in Port Edwards, Wisconsin, which is just a few miles South of Wisconsin Rapids. Also, both of my grandfathers worked in the Rapids mill back when it was called Consolidated Papers. One of them retired in the 1960s after over about 30 years of service, and the other retired in the early 1970s, after over 40 years of service.

So when we, at the Chicago Fed, began our Project Hometown initiative, I jumped at the chance to highlight what's going on in my hometown, not just because it's really important to central Wisconsin, but also because its representative about transformational change that's going on in similarly situated communities across our country. I hope that what we learn here can better inform communities beyond just central Wisconsin.

So today, I'm joined by thought leaders from the private and public sectors. Our panelists include Katie Weichelt from the Marshfield Clinic Health systems, who's also an independent geographer. Paul Fowler, Executive Director of the Wisconsin Institute for Sustainable Technology. Dan Sullivan, Executive Vice President and Director of Economic Outreach Community Development of Policy Studies, and Public Affairs at the Federal Reserve Bank of Chicago. And Kristopher Gasch, Board Chair, Encourage Community Foundation and Director of Marketing at Fey Printing.

Hello, everyone, and thank you very much for joining us. Today's topic of our event, of our webinar today, is to discuss how Wisconsin Rapids can reinvent itself once again, following the shutdown of the Verso Paper Mill that laid off over 900 workers. The pandemic precipitated a sudden and dramatic decline in the demand for paper produced at the Rapids mill, accelerating long-term global trends and ushering in transformational change.

The mill was indefinitely shut down on July 31. Paper had been continuously produced at that mill since 1904. However, the demand for the graphic paper produced by the mill had been trending downward for many years, as we've seen with many other industries. For example, banks closing branches, and the rise of contactless payments, e-commerce, telehealth, industrial automation, and robotics, the pandemic has greatly accelerated long-term trends ushering in transformational change.

The purpose of this panel is not to be doom and gloom, rather, it's to ensure that we recover from the COVID-19 crisis, and while we are doing so, we utilize our best thinking to find a path forward that is inclusive, and lifts up everyone in the central Wisconsin community, and to offer hope, because as we will see shortly, Wisconsin Rapids has been here before. So, I have a few housekeeping items. Today's event is being recorded, and it will be available on the Chicago Fed's website at chicagofed.org/hometown.

Once the event is posted to our website, you will receive a short survey. And I hope that you will take the time to answer the brief questions, as it actually helps us to constantly improve events such as this, and provide us with fresh ideas about what's important to you. The views expressed by our speakers today are simply the views of each individual presenter and do not necessarily represent the views of the Fed Reserve Bank of Chicago, nor the Federal Reserve System. Other experts and practitioners here today are among you in the audience, and we encourage you to participate in the Q&A session that will be coming up at about 2:35 or so.

We received a lot of audience questions during our registration process. And so we will try to get through as many of those as possible. Also, we will be taking live questions during the event. So please take advantage of that.

I'd like to remind our speakers to mute themselves when they're not speaking and to unmute themselves when they are speaking. And so with all that intro out of the way, we will now get underway. Katie Weichelt is our lead-off speaker, and she will lay the foundation in a historical context for our discussion today. So Katie, please take it away.

KATIE WEICHELT: Thanks, Steve. Thank you. My name is Katie Weichelt. I have my PhD in geography from the University of Kansas, and my dissertation was actually on three communities in the Wisconsin River Valley, and the historical geography, and how they impacted the landscape there. The three communities included Wisconsin Rapids, Port Edwards, and Nekoosa.

As Steve mentioned, Wisconsin Rapids certainly has been here before. Lumber production played an important role in the development of the region. It started about the 1820s and then really expanded in tandem with your American settlement across the Midwest and Great Plains. Lumber was, of course, really essential for building structures that were crucial for the development of the agroindustrial economy of the United States.

However, technology has a habit of ushering in change. And it's interesting that technology, such as the development and implementation of the railroad system in Wisconsin, really sped up the decline of the valuable white pine lumber in the late 1800s, 1870s, 1880s. So there was the decline of the lumber industry and the sawmilling industry in the region.

So local business people, entrepreneurs, had to kind of look around and see if they could invest in other industries. Many of them could have simply left and tried a new community, and certainly with a lot of lumbering communities that definitely happened. But some of them decided to stick around and stay, and really kind of invest in new opportunities.

One thing that kind of strikes me is how they really recognized the opportunities available to them at the time. There's several things happening that make paper a profitable industry or a viable industry in the 1880s and latter decades of the 19th century. First, we have an industrializing economy in the United States. Newspaper and book readership is increasing, so the demand for paper is certainly growing at this time.

In the decades prior, you had, again, technological developments that have now tied paper production to wood resources. And what you also have, now, that even though white pine is in decline, you do have other sources of lumber on the landscape that are a little bit more valuable. So the stage is set.

So you have all these resources available, but you do have individuals that need to look at this and say, OK, this is something worth investing. And one other advantage they have is the investors, all they had to do is look east a ways and see that the Fox River Valley was starting to build paper mills along their shores as well. So they had an example of a paper mill in production in a close geographical space.

I think what's interesting is typically we see these investors, in the case of Wisconsin Rapids in particular, you had Jer Witter is a big figure that comes up a lot, and Nels Johnson. These early entrepreneurs really tended to pool their capital. They looked at these projects of building these paper mills and developing these paper mills as a group project.

It wasn't definitely an individual undertaking. They tended to pool their capital. And paper mills were much more-- even at this time-- were much more expensive to build than, say, saw mills where their previous experience lied.

So what they would do is they would pool their resources, they would sometimes write to other experienced paper investors and ask if they could have assistance with investing in these companies. And then, in the case of consolidated, in particular, in Wisconsin Rapids, that company actually began as a power company where a lot of interest and water rights holders really came together in the area to develop this company. And eventually, they developed a mill as a result of that.

Once these companies were established, Consolidated Papers in Wisconsin Rapids, and I think the same holds true for Nepco in Port Edwards, is they really worked to be adaptable to diversify, to invest in new paper lines. And I think that was really key to their success. I think when I think of what we can learn about this period of moving forward and taking a risk on a new industry, I'm kind of struck about how they stopped, recognized what resources they had in the region, what they could do, what strengths the area possessed, and really took that and to help their communities move into new directions.

So capitalism is a system that causes economic disruptions. And those disruptions are pretty devastating, as I'm sure Dan and Kris will mention and talk about later. But that is part of the system. And knowing that, I think we could go take this further and towns could just kind of look for new opportunities based on the strengths that they do have, the resources they do have going forward. And with that, I'd love to hear from Paul.

STEVE KEUHL: Excellent. Thank you. Paul-- do we have Paul? He's probably-- yeah, there we go. Thanks, Katie, very much. Really appreciate it. Paul, you're up.

PAUL FOWLER: Thanks, Steve. And thanks, everyone, for joining today. My name is Paul Fowler. I'm with the Wisconsin Institute for Sustainable Technology at UW Stevens Point. And we've spend the best part of a decade really monitoring what's happening in the paper industry, both regionally and at the state level, but also in terms of a global context as well.

So what I want to do now is just kind of focus on why the pulp and paper industry is right now, so bringing us kind of up today. So pulp and paper industry dynamics are changing like they never have before. Uses of fiber and applications of paper and paper board products are rapidly diversifying. And while it's true that graphic papers consumption is in steep decline, global demand for fiber and paper-based products is increasing.

Global megatrends like food packaging, e-commerce, anti-plastic sentiment, hygiene and specialty products, are all driving growth. At the same time, sustainability initiatives by companies and brands, they're leading the displacement or substitution of plastics, and consumer packaged goods, and also in single food serviceware, single use food serviceware. And at the same time, companies are framing their sustainability strategies around the use of recycled content, which in the case of paper products, requires the use of recovered paper, whether it's from old corrugated containers, or old newspapers, papers, and magazines.

E-commerce, coal chain shipping, and prepare-at-home meal kits are all contributing to demand for corrugated boxes. And these trends have prompted both the conversion of existing paper mills as well as the construction of new recycled paper mills for corrugate production across the US. When I looked most recently, I think there's about 20, 22 announcements of either conversions on new mill constructions underway in the States right now.

Wisconsin has its own examples of these with Green Bay Packaging's new mill under construction in Green Bay, Appleton Coated, former Appleton Coated, rebirthed this Midwest Paper, and that went through a switch from manufacturing fine papers to corrugate. And even more closer to home, ND Paper's purchase a new investment of $189 million in the Biron Mill.

So ND Paper is focused on an effort to make recycled liner board and corrugated media for corrugated boxes, but alongside high-end printing and writing papers on their B26 paper machine in Biron. I think what's notable-- some questions arose around the impact of China in the questions from attendees-- ND Paper's just one of a number of Chinese-owned enterprises that has made significant investments in idled or undervalued US paper mills.

And the origin of this trend can be traced back to China's so-called National Sword Initiative. That's something that started in 2018 by banning the import of certain categories of solid waste, including, among them, recovered paper grades like mixed paper, and now, as well, as we move into 2021, old corrugated containers. So China's underlying so-called, Blue Skies Policy, is effectively cutting off the supply or import of scrap materials, that mixed paper and old corrugate that has been the feedstock of China's pulp and paper industry.

So the onset of National Sword has amounted to somewhere in the region of about 15 million tons of waste paper that was formerly exported to China, now kind of remaining onshore in the United States. Obviously with the implementation of National Sword, China's demand for fiber did not suddenly end. China is a huge fiber user, and it's highly reliant on timber and fiber imports for its manufacturing.

And so as a result of that, entrepreneurial Chinese businesses are seeing the opportunity to upgrade and remanufacture recovered paper onshore here in the United States through the acquisition of those mills, and then export that value-added product back to China. Now, of course, those 20 or so mill conversions and new constructions to make corrugate are not all focused on export markets, they're focused as well on serving that increased demand that I talked about earlier from domestic markets and customers.

And for sure, that demand for corrugated boxes has injected, certainly, new life and vibrancy into certain sectors of the paper industry. In March last year, The New York Times ran a story headlined, The Great American Cardboard Comeback. And recent efforts to reposition mills and revitalize mill towns are absolutely to be commended.

But I think I see a rush to recycle. And I think in this rush to recycle, I see at least one opportunity for mill communities. And to be clear, that's not necessarily to jump onto this ever increasingly fast recycled fiber bandwagon. For me, an opportunity revolves, I think somewhat counterintuitively, around virgin fiber production.

You see, each time a fiber is recycled, its properties are diminished. Each time a box is recycled, its fiber is downgraded and down cycled. And so as demand for recycled fiber grows, from e-commerce retailers, from brands, and so on, that supply chain tightens. And so, then, opportunities to position and differentiate virgin wood fibers increases.

Now, this must be a medium to a long-term goal. But for those e-commerce retailers, consumer packaged goods companies, and brands that are crafting their cost customer messaging, their sustainability store is in corporate reporting around recycled fiber. There's a highly likely recycled fiber supply and demand crunch coming.

And I think with that crunch, there comes an opening. An opening which means we can start to inform, educate, develop metrics and indicators, work with manufacturers and their brand-owning customers to begin to rehabilitate virgin wood fiber within their sustainability stories. At the moment, it's all about recycled. But when that crunch comes, virgin wood fiber has a really important differentiated space.

And, of course, along with this should go developments in technology and process innovation, all in parallel. You know, it's happening already in Europe. Stora Enso, Sodra, SCA, all recently announced new virgin wood fiber production expansion, between them, over a million new tons set to come online. And it's also happening in South America at an even greater scale.

So, just to kind of sum up, I think there's a momentum and a moment right now to kind of reinvigorate, reimagine virgin wood fiber applications, as well as their sustainability story, in the context of both recycled fibers, but, also, in terms of competing regions' fiber production alongside innovation in production, processing, and applications. We can begin to differentiate high-quality, performance-leading packaging, food serviceware, and specialty products and find a new way forward that does not necessarily follow the trend of downcycled corrugate manufacture.

So then we might start to embrace the performance sustainability attributes and high-end requirements of customers that demand next-generation packaging and specialty materials. So I'm optimistic about the future of paper. I mean, the demand is growing. The fact that there's entrepreneurs, innovation in that space, and a whole lot of demand driven by those global megatrends that I said at the outset, there's a lot of work to do, but the industry, as a whole, is not dying. It has a sustainable future ahead. Thank you.

STEVE KEUHL: Very good, thank you. Thank you very much, Paul. I appreciate those comments. Dan Sullivan is our next speaker, and [INAUDIBLE] Dan will provide his perspective as a labor economist. Dan?

DAN SULLIVAN: All right, thanks, Steve. And this is really great to be part of this event, which is super interesting. And I'm learning tons about paper and the paper industry, which I didn't know before. And I'm afraid I'm not going to be able to add to that knowledge very much. It's not something I've studied in the past.

What I am, as Steve noted, is an economist, a labor economist specifically. And economics is often called the dismal scientist-- pardon me, the dismal science, which makes me a dismal scientist, but that's especially true for me because one of the areas I've spent the most time thinking about is what happens to workers who are displaced from jobs like the ones that Steve's grandfathers had where they had them for a long time, 5, 10, or 20 years and things like that.

And, when they lose their jobs, I'm afraid that the basic answer is it's not, on average, a very pretty outcome. So I'm going to-- I'm going to tell you the sad stories a little bit and then maybe try to talk about some of the things that communities can kind of do to try to maybe mitigate some of the worst effects. But I I'm going to take my shot there anyway.

So the basic thing that's probably not too surprising is that, when people lose jobs that they've had for a long time, it takes them a while to find another job. They're often unemployed for three months, six months, even, times, a year. And that's a painful thing for them. They're losing lots of income. Of course, we do have an unemployment insurance system, which can kind of be a little bit of a Band-Aid and help them out a bit. It doesn't replace all of their income usually, but it does a portion.

But really that period of unemployment is not the really the big problem when workers lose their jobs. I mean, it is a problem. It is a big problem, but it's not the biggest problem. The biggest problem is that the jobs that they're often able to get afterwards are not as good, at least in terms of their pay, as the jobs that they used to have.

And the research I've done in lots of different settings, from steel mills to timber producers to lots of other kinds of places, find that, when people have had a job for 5 or 10 years and then lose it because their company shut down in a big way like that, often, they're going to get earning-- their earnings on their new job are going to be 20% or 25% or 30% lower than what they were accompanied-- than what they were used to.

And then there's some improvements over time, but, even 5 and 10 years later, you can still see the effects of job loss. So that is, basically, a fact, and that's why it's so important that communities, like Wisconsin Rapids, do their best to try to aid the workers and find new things for them to do that are going to sort of mitigate some of those losses.

Let me just say a little bit about how not everybody suffers the same kind of losses. I'd say it's probably the worst for the sort of middle-aged people. Younger people, they haven't had as much time to invest in their current job. And they have more chances to sort of catch up and do other things.

And then older people, people my age or so, they're relatively close to retirement. The number of years of really high earnings lost isn't so great, but it's that middle group, say from 35 to 55 in age, where it's really a serious problem. And you need to think about things that could help them out.

It's actually one reason why formal education is a good thing because one thing that you do see is that workers who have had some relatively strong educational backgrounds do better. They're able to sort of recover more because they probably have more general skills they can take other places, but not everybody is in that situation and so, probably, need to think about strategies for that.

And one strategy is, basically, just helping people to find jobs that use the same kind of skills that they used to have or that they-- well, they still have the skills, but they used to be able to use them. And so, actually, I didn't follow 100% of what Paul said, but it did sound like maybe there is some hope for the paper industry for other kinds of plants and things staying in the region.

And that would be great because then people could take the skills that they have and transfer them to a new setting. So I think industry fathers, to the extent they have the ability to do this, should be trying to attract industries that can use some of the same skills that the workers have used for many years on their old jobs.

Another thing is it's just generally better if the economy is strong. So I'm afraid the fact that we're in a bit of, obviously, a very-- well, we're in probably the deepest recession we've had, certainly, since the '30s is not a good sign. On the other hand, I think there's some hope that the recession might be a relatively short one, and there might be some sort of dynamism coming out of it because that really is a key that workers do better when they lose their jobs if they lose them in a more vibrant labor market where the economy is, generally, doing better.

Another thing I've studied quite a bit is the ability of training programs, the kind of things that community colleges and technical institutes and others put on, to help displaced workers can help. And I think the answer there is definitely yes, but not for everybody. And one can't really expect miracles.

So, if you've had an event that happened, and it reduced somebody's earnings by 20%, it's not something that a six-week program is going to be able to get them back to their old thing, at least, not normally. You're looking at sort of like years, perhaps, of training in order to sort of really make up for these kinds of events. So I think it's worth doing, but, perhaps, not for everybody.

Probably, most obviously, you wouldn't train somebody, put them back through a new training program, when they're in their 60s because they're close to retirement anyway. And it's going to take a long time to sort of make up for the losses. And the actual training will, in the short run, reduce their ability to make money. Most people get their training while they're doing some work, but they're not able to work as much as if they were working full time.

So, anyway, that's a message that training is important. Training is not for everybody. And I think it's especially tough-- either it doesn't make any sense for older workers, but it also is tough for people who, typically, have not had good experiences with school in the past. So sending somebody who didn't finish high school to a training program to learn how to code is not likely to be a highly successful endeavor. But, for the right set of people, it's worth doing.

And then I guess the last point is you really need to make sure that you're training for jobs that are going to exist. And I think most of the community colleges and technical institutes know that, and they have strong partnerships with employers. And I think that's an important thing for people who have this mission to actually do their best to make sure there are some jobs for the people when they finish the programs.

So that's what I have to offer. It's not a happy thing in terms of the implications of job loss. On average, it's very bad, but, hopefully, there are some things that can be done to kind of mitigate that, make it a little bit better. And Wisconsin Rapids will be an example to us in the future. Thanks.

STEVE KEUHL: Thank you, Dan. Thank you very much. Kristopher Gasch is our cleanup speaker. And Kristopher will provide his thoughts about the role that the Rapids paper mill had in the social fabric of the community. Kristopher?

KRISTOPHER GASCH: Thank you, Steven. So I have, for the last six years, had the pleasure of serving as board chair at Incourage. And we began life as a very traditional community foundation and have evolved into an organization that is very much committed to addressing the challenges of reinventing and renewing our economy here in place and in concert with those who live, work, and call this place home.

And I would just start by saying that the role of philanthropy, particularly in a public entity like Incourage, is an interesting place in a community that, for over 100 years, was very well taken care of. We were very proud to say that we were the smallest community in the United States to be home to a Fortune 500 company headquarters. And there's just so many examples of lumber things going back over those 100 years of what that meant for us, as communities.

One of the mills provided white paint to residents to encourage them to keep up the appearance of their homes and keep the community clean and good looking. One provided steam and heat to houses near the mill and to the school. So, little things like that all the way up the scale, it just goes without saying that was such a large presence. There were many benefits to the community.

And, after [INAUDIBLE] local ownership, a lot changed in a very short window of time, requiring the community to really change our mindset from one of dependency to accept that the calendar has turned the page and that we need to, collectively, meet the challenges of the new day. And no longer did we have the large they to help us take care-- or to help take care of us.

But we've had generations of employment at the mills, and, suddenly, that's taken away, and people are asked to take risks and to address an uncertain future and help shape what that future could look like. That's intimidating to say the least. And it calls the question, if we're not paper-makers, what are we?

So Incourage was founded in 1994 with an organizing purpose to meet the changing needs of the community. And it was just six years later when ownership of the mill changed, and the headquarters were moved to Finland. It became very clear that we, as a community foundation, needed to step outside the traditional foundational role and help navigate the path forward with the rest of our community. We needed to do more than just [INAUDIBLE] performance that we had.

We saw that jobs were disappearing. Families were moving. And hope was very much disappearing with them. And it also became clear that there was a significant socioeconomic divide right down to a stigma over which side of the river you live on. East side is seen as slightly more superior to the more industrial west side.

And, over the next decade, we saw median household income in Wisconsin Rapids fall by nearly half. So, with that in mind, I'd just like to touch on a few ways in which we have worked to kind fill some of those gaps in the community from our position as a public foundation.

In 2004, we launched what we called the Community Progress Initiative, which was designed to empower entrepreneurs, shape a shared vision for people throughout the region, motivate young leaders to drive positive change, and inspire a sense of community spirit and pride, which was very, very much lacking. In a lot of ways, this four-year initiative was very much ahead of its time for what we, as a community, were ready to tackle, but it started us all on a very positive course, bringing people together, often, for first time.

If we fast forward to 2008 and the closure of the Port Edwards downtown mill, Incourage initiated, organized, and held the first broad convening of folks, regional, municipal, faith-based, leaders, residents, all to just collectively affirm that we were in this together. Over the years, we've brought significant outside resources into the community, [INAUDIBLE] financially [INAUDIBLE] partners, and then the Ford Foundation, the Knight Foundation, National Fund for Workforce Solutions, the MIT Media Lab, and many others.

We've hosted some domestic and international study tours with the Ford Foundation. And we took a group to Northern Ireland at one point to witness firsthand how those communities found resolution after years of conflict. And we just know that, when lives are drastically changed, and emotions are very raw, that requires healing and resolution to come back together as a community.

In 2012, we conducted our first Broad Community Survey, which over 4,000 residents participated in. And those results indicated that residents really felt competing emotions. It was hopefulness diminished with skepticism. And that uncertainty was very large. And keep in mind this was 12 years after that initial sale in the year 2000.

STEVE KEUHL: Kristopher, some people-- some people are having a hard time hearing you. Could you speak up just a little bit. I think some people are having a hard time hearing you. Thank you.

KRISTOPHER GASCH: Absolutely.

STEVE KEUHL: Yeah, that's better, at least, on my end.

KRISTOPHER GASCH: Of the priorities that emerged from that survey in 2012, I think most encouraging was an openness to change and new ideas. So, with that in mind, it was also in 2012 that we embarked on an ambitious project that was really, in many ways, the culmination of these decades of work.

And then we purchased the Tribune Building, which is a vacant former newspaper printing facility right on the banks of the Wisconsin River in downtown Wisconsin Rapids. And we immediately turned that decision-making process over to the community to a year and a half long facilitated process to help identify what the community wants and needs in this space.

As I'm sure is typical in many communities that experience really, really swift change, there have been different views on how to move forward. And we've worked to identify what those new approaches might be to realize the necessary long-term change and how to approach economic success and building partnerships outside of the city.

So, as the Tribune project evolves, we continue to position it as a connector of all of the assets of our [INAUDIBLE]-- industry, education, nonprofit, government-- to facilitate those new approaches to economic renewal. So we had over 2,000 people that participated in that process and nearly 1,000 ideas were suggested at the first meeting alone. And participants agreed to shift from me to we right at the outset.

So what has emerged from that is plans for a center for, really, regional collaboration and innovation. And it's a hub for entrepreneurial and workforce partnerships, training, business incubation, and a community gathering place as well. Partnerships have emerged with University of Wisconsin, Stevens Point, the Wisconsin Institute for Sustainable Technologies, the Organization of Paul A. Smith, their College of Natural Resources, the Small Business Development Center, as well as Mid-State Technical College here in Wisconsin Rapids, Marshfield Clinic, which is the place where Katie is, and other health-related organizations, city, local, regional economic development initiatives.

The building has a lot. There's a lot planned for it. It includes commercial space with a market hall, cafe, the only riverfront dining in downtown Wisconsin Rapids. And we see it serving as a catalyst for further development downtown. We've completed phase one demolition already and are currently in the fundraising stage for the next phase of construction, as well as a director position to coordinate all of the moving parts.

So I could speak for the full hour about what the Tribune represents for this community in the wake of such change. And, certainly, the recent Verso closure only underscores its importance. So, I think, in the interest of time, I'll just say that there's a wealth of information about these items all on our website.

And, at the end of the day, we just keep in mind how this community was built in an innovative spirit. And it was people that took risks and created something entirely new. And, well, we say at Incourage that our people are our greatest assets. And the Tribune Building's history as a center of information for this community just has it perfectly poised for its next role as a center where all voices can be heard, where our past is very much honored, and our future is created together.

STEVE KEUHL: Great, well, thank you. Thank you, Kristopher. I did get a message that we had low bandwidth. So I really hope that the people on the call and, also, on the streaming part were able to hear that. I know some people were able to hear you and not see you, and I think some people were able to see you and not hear you.

So I do apologize to everybody listening and viewing. We were trying-- we are very much trying to get that fixed. So, if you could be patient with us, that'd be great. We're just suffering through some low bandwidth on that part of it. So I apologize for that.

We're now going to turn to the Q&A portion of this webinar. And we received quite a few questions from the audience during the registration process. And the first one is for Katie.

And so, Katie, I think, if you could, you touched on this a little bit in your remarks, but if you could expand, I think, a little bit more on sort of the role that entrepreneurship played in the founding of the paper industry in central Wisconsin? And I think you were talking about a little bit of some of the elements that kind of went into that in sort of the founding of the industry, but if you could sort of maybe look at what maybe-- what some lessons that were learned in say the 1880s, and do any of those lessons apply today?

KATIE WEICHELT: Sure. Yeah, so, as I mentioned before, I mentioned a little bit about kind of what went into the development of these paper mills. As I said, they were much more expensive to build than their sawmills. When you start looking at the history of Wood County of Wisconsin Rapids, Port Edwards, and Nekoosa, I think you're kind of always struck about how the same names keep popping up in business history.

And so what I kind of take from that is just this group of entrepreneurs were just really invested in a lot of different things. And, at times, they were competitors, but, also, they cooperated a lot as well. So, as I mentioned, they recognized the resources that they had.

When they didn't actually have all of the funds required to produce a mill or invest in these new ideas, they sought assistance. They pooled their resources again. And they sought expertise when they needed to. And I think that's a crucial one.

In those very early founding of those paper mills, certainly, the very first one that was built in 1890-- 1888, 1890-- early 1890s in Centralia-- yeah, it was closed by 1912. They didn't have paper expertise. They had some business experience, but not paper expertise. So they actually recruited an investor who was instrumental in developing Kimberly-Clark, a familiar name in the paper industry.

And Thomas Nash, a big paper entrepreneur in the region, he, actually, wrote to I think Kimberly-Clark or some other paper producers in the Fox River Valley to say, hey, I want to build a paper mill in this region. Will you help me out? And they wrote back and said not a chance. It's tapped out. But he persisted, and, eventually, he was instrumental in founding that Nekoosa mill as well.

So, in a long-winded way, I think these people were willing to take risks, and they worked together to do it. They were also not afraid of adapting to new technologies. I remember it was the mill at Wisconsin Rapids, the Consolidated Paper.

They were the first to have their machine-- they were first in the industry to have their machines run entirely on electricity, their first electric-powered machines. It blast that in the headline of the July 27 newspaper, 1904. That was kind of a big debut. The Grand Rapids Tribune, if you look at the historical newspapers, it just kind of-- it brags about that right there.

And then, later on, what really made Consolidated Papers, in particular, stand out was their adoption of new technologies to produce coated papers so, again, that entrepreneurial spirit of taking risks, adopting new technologies. And they applied that to their business, as they-- throughout their business history.

I think the lessons today are, again, just kind of looking for new opportunities, looking for the strengths that you had, much like they did, seeking outside assistance when you need it, and really kind of diving into the unknown and kind of taking those risks. Thank you.

STEVE KEUHL: Excellent, thank you very much. I really appreciate those thoughts. One of the things that was sort of flashing through my mind-- and I just know this from having grown up in Wisconsin Rapids-- I know the baseball field in Rapids-- I don't know if it's still there, but it was known as Witter Field when I was there. And I think Witter, the Witter family, owned a bank I think. And so access to capital was really important.

And, if you're a major investor in the paper mill, and you own a bank that could certainly help as well. That's a little bit beyond the scope of this conversation, but thank you very much. I really appreciate that. I mean, entrepreneurship, you know, it's a skill set, whether we needed it in the 1880s, and we need it today. So those are some really good lessons. I really do appreciate those thoughts.

The next question that we have, actually, is for Paul. And we did get quite a few questions. Actually, a lot of questions came in asking us for whether we've heard any new updates from Verso. And, also, can Wisconsin Rapids keep Verso's attention and keep the company actively focused on the mill's future? And so, Paul, I wonder if you have some thoughts along those lines.

PAUL FOWLER: Sure, thanks, Steve. So the latest information I have really comes from Verso's earnings call from [INAUDIBLE] last Monday when the messaging regarding Wisconsin Rapids I would say, kind of candidly, is a little mixed. The new CEO reported last week that they've had interest in both the Duluth and the Wisconsin Rapids mills, but now they're kind of slowing down, taking a pause on Wisconsin Rapid because, in his words, it's very difficult to deal with the mills in these times. And the interest was not what they thought it was or what they think it might be in the future.

But, on the other hand, with the Wisconsin Rapids task force, we heard that the interest has been there, although, from a potential competitor in that sort of pulp space. And so they were, from a commercial standpoint, not that interested in, perhaps, negotiating a sale to a potential competitor. So a little mixed, I would say. They did say that their Duluth mill had some people interested and that negotiations are continuing there.

In terms of keeping Verso interested, I think the task force has played a-- certainly played a part there, both Senator Testin and Representative Krug have sort of called out Verso's stance with respect to the mill in terms of maybe a little bit of game playing and kind of giving a bit of a run around. And Senator Baldwin as well has written a couple of letters, at least, to Verso's former CEO and to the new CEO as well to sort of put the pressure on in terms of moving forward and getting some definition on their plans going forward.

What else could you do in terms of keeping, though, the mill front and center of Verso attention? Well, I look to and think about what others have done in terms of leveraging customers and leveraging investors in this sort of space. And I was-- I was taken by the story of Nestle. And this is probably about five years ago.

Customer pressure on Nestle, in fact, caused them to change their palm oil supplier. They just did a complete about-face in terms of their supply of palm oil, moved to a more sustainable supply of palm oil. And so I think that leveraging customers is certainly a way to go and then, as well, leveraging investors. And there's a really interesting and I think closely related story coming out of Procter & Gamble.

Just a month ago, at Procter & Gamble's shareholder meeting, shareholders really put a lot of pressure on Procter & Gamble to get out of the use of Canadian timber, boreal forest timber. And Procter & Gamble is changing its stance there. So I'm thinking that the levers to pull are investors and customers as well.

The other thing that I think is interesting is the Business Roundtable and their statement on the purpose of a corporation. Now Verso is not a signatory to the Business Roundtable's statement on the purpose of a corporation, but it may be that customers of Verso, if you look at the list of signatories of the Business Roundtable, again, opportunities to advocate or pull levers of particular customers there and, also, peers of Verso or industry peers at least.

International Paper are signatories of the statement of purpose. Kimberly-Clark are too. So I think understanding where those sort of levers are in terms of customers and investors is kind of intriguing for me.

STEVE KEUHL: Great, thank you. I think those are all very, very interesting thoughts. The next question that we had in is for Dan because he's a labor economist, and he's studied how workers have had to reinvent themselves after a job loss. And the question is, what thoughts, Dan, might you have for policymakers that could provide sort of the best outcomes for central Wisconsin and its currently dislocated workforce?

DAN SULLIVAN: Sure, let me try. It's a hard question in some ways, but I think one thing is to do some of the things that I think Paul is describing is actually being done to try to find similar industries to sort of bring them so that the workers can transfer their skills. And I think that, if that can happen, that's an important thing that workers who lose their jobs, even if they've had them for a long time, if they're able to go to another firm that does at least somewhat similar kinds of work, they often do quite a bit better than if they have to make a really radical change in their occupation. So finding similar work out there is important.

I guess I should say that, maybe not necessarily for policymakers, but, for workers themselves, you should also be on the lookout for what are my skills, and how can I take them to do something similar. And it wouldn't necessarily have to be in the same kind of product, so like a paper mill to a paper mill.

I know there's examples of like auto workers. It turned out, in some sense, that work was kind of similar to making windmills. And, of course, an automobile and a windmill aren't very similar as a product, but some of the actual steps that are taken in that work are similar. So be on the lookout not just for the same product, but for products that use the same skills that the workers currently have. I think that would be a good idea.

And, of course, I already mentioned that I think training is a good idea, but you need to make sure that they're training for jobs that exist. And so having those partnerships that are strong with the local employers I think is a really important thing.

So they should-- probably, the way that that happens best is if the employers who are going to hire the workers out of their training program have to make a little bit of the investment themselves and provide some of the extra funding to sort of allow a community college or somebody, a technical institute, to do the kind of work. So I would say make sure that those linkages between the training that you do, if you're going to do it, and the jobs that are going to come out are strong because it's important that that exist.

STEVE KEUHL: Yeah, great. Yeah, those are good points. And having some skin in the game and all those sort of comments and things make a lot of sense. Thank you, Dan.

Kristopher, I can see you. I can see you just fine, and I can hear you fine. And so I-- and I apologize for some of the problems we've been having on the technical side.

But I can see you fine, and I can hear you fine, at least, on my end. So I hope a lot of people that are on the live stream and others can hear you as well. So don't give up hope. Don't give up hope.

KRISTOPHER GASCH: I'm still here.

STEVE KEUHL: Excellent. So my question-- this has come in. And, just during the course of your remarks, you mentioned sort of the need for cultural change. And it's a magic wand question, but I love to hear the answer to these sort of questions. And, if I gave you a magic wand and if you could change just one thing about central Wisconsin's culture to ensure a brighter future, what would that be?

KRISTOPHER GASCH: Oh, I would say that we often speak at Incourage about creating a participatory culture. And that's just not easy, given the challenges of what one consultant had once called a pervasive they problem that we have here, right? They won't let us. They take care of that. They make the decisions.

It can be difficult to inspire people to believe that everyone not only has a valuable voice in the conversations about the future of this place, but that it's absolutely imperative that all of those voices are heard. So I think that, if I could change something, it would be to instill the confidence and drive for people to take part in helping to shape our future here.

The world is run by those who show up. And we know that diversity is what makes us great. And I just think that we owe it to ourselves and to future generations to show up, to speak our part, and to advocate for what we believe is best for our future.

And I just think about a couple of years ago, walking into a little shop that sold local goods. And there was a t-shirt there that had the shape of Wisconsin. And, right over Wisconsin Rapids, it said, "I like it here." And that was the first time I'd seen anything like that with such pride in place. So I guess I was just-- I would hope then that that participation would create even a greater sense of pride in this place that there is value here and that there is a future here as well.

STEVE KEUHL: Well, that's a great comment. I know I grew up there. And it's a great place to grow up and raise a family. And, boy, it was-- it was a wonderful place to live. And it still is. I know my mom is still in the area, and I just love getting up there as much as I can. So thank you very much for your comments.

One of the things I wanted to ask-- and I guess I would probably address this to both Katie and Paul. And it seems to me it's no accident that these paper mills grew up, so to speak, on the river. You've got-- you've got the hydro power. And, these days, it's a really big deal because it's alternative energy, and it's clean power.

And I think I read-- and don't quote me on this, and I know this is being recorded. But I think that the kilowatt cost per hour at these paper mills, because it's on the Wisconsin River, are pretty low. I have a figure in the back of my brain, but it's probably not right, but, essentially, it's pretty low to generate the enormous amount of electricity that's required in these paper mills.

And is that something that really could be leveraged? It seems like-- I know, in Port Edwards, it's right where the Wisconsin Rapids makes a really nice turn there. And it does seem to me that I'm just surprised that there isn't industry falling all over itself to locate and just like, literally, plug into this alternative energy, which is a big deal. And is that a big selling point?

I mean, it's just something that's kind of come to my mind. I know, Katie, from the historical standpoint, it seems to me that the mills located in that spot for a reason. Also, there's the logging thing I think where they would-- where they would get the logs floated down from north of Wausau. But I'm just curious if the two of you have any thoughts along those lines.

KATIE WEICHELT: I don't know if I can comment more so on the modern advantages of it. Maybe that's better for Paul. I will say, from a historical perspective, certainly, the river's kind of natural drops in that region, that part of the river, were definitely an advantage into producing paper and, also, logging as well. So, yes, I can't speak to why it's not an advantage now, but, perhaps, Paul can probably do that. But, certainly, that was an advantage in the early days of the paper making.

PAUL FOWLER: So I think that that question about alternative or renewable energy is a really interesting one and an intriguing one. So the hydropower is, I guess, a smaller part of the renewable piece, but what is really intriguing as well I think is the fact around the liquors and the byproducts that are burnt in boilers and so on to help also create energy.

And there was-- I think it was only in the last sort of few months or so-- a really interesting lifecycle assessment paper coming out of Europe I believe it was, which looked at that the relative energies of production of recycled paper versus virgin fiber, recycled fiber versus virgin fiber. And the balance sat pretty much in favor of virgin fiber really on the basis of the amount of renewable energy that is generated from burning the byproducts to create the electricity and the heat and the steam and so on, which, on the face of it, isn't immediately obvious, but a really intriguing question there and, also, part of that opportunity, I think, around what I talked earlier, rehabilitating virgin fibers in terms of the prospects that they have for a sustainable commentary in the-- sustainable economy in the medium term.

STEVE KEUHL: Excellent, great, thank you. Kristopher, I'm going to kind of give the last question to you. And I can see you fine, and I heard you fine. So I really hope others can.

Could you just give us like the latest update on the Tribune Building? I know that I've been there before. I think it's a really special place. I think that what Incourage is trying to do there in sort of like the-- I'm aware of sort of the outreach to the community and how you really did receive grassroots input into sort of what to do with that building.

And, if you could, let's say-- we have to-- I have to launch into the remarks, the closing remarks here, in about one minute. But, if I gave you 60 seconds, could you give us sort of the one-minute overview of what the current state of play is of the Tribune Building?

KRISTOPHER GASCH: Happy to, yes. When we first launched into the project, we said, from square one, that this is about more than the building. The building is a physical asset, and we can do a lot with that, particularly, in the heart of our community, but it's about more than the building. It's the connections. It's honoring resident voice, and it's helping to fill gaps and needs in the community.

So that's where we started. That's where we stay. As I mentioned, we are in the fundraising process, and it's a long haul. And I think it just speaks to the challenges of facing change, whether you're in Wisconsin Rapids or any community, but we are committed to this place. We are committed to realizing that project to help really address needs right here in the community.

As I said, there's just a wealth of information on our website. So, if anyone is curious to read more, incouragecf.org is the place to go. There's a lot there, and we are fundraising for the next phase of construction and that project director position, but, as the community has changed, and, certainly, COVID has impacted so very much, we are committed to making sure that what that building becomes is sustainable and is able to meet the continually changing challenges of whatever the future holds for us here.

STEVE KEUHL: Wonderful, thank you. And I wish you lots of luck again in the Tribune Building. I've been through it. I was through it when it was under construction. And I think you're making some really good change there, and I think you are right on the right track there. So I commend you on your fine work there.

I also want to thank all of our panelists for your insights. I learned a lot on this panel. And, also, I want to thank our audience and for all of you and for your thoughtful questions that we received. It really was interesting to me to know that Wisconsin Rapids has been in this situation before when its sawmills were in decline, and it needed to find a new economic engine. And Wisconsin Rapids was able to successfully reinvent itself into an economic powerhouse through the paper industry.

I know that we can't solve in one day all the difficult problems, but I hope that this panel has helped to highlight some of the issues and opportunities for a path-- for a path forward. Once again, please look for the survey that will be in your mailbox as soon as our video of today's webinar is posted to the chicagofed/hometown website. And that concludes our event today. So thank you very much for joining us, and have a happy--

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