evelopment in New Jersey may be aided by property tax reform signed into law early this year. But the growth and demand already evident in the region are driving significant projects in Logan Township, halfway between Philadelphia, Pa., and Wilmington, Del., along the Delaware River.
   Advanced Drainage Systems is establishing a US$12- million, 100- worker manufacturing plant in the 140- year- old Gloucester County community to serve the eastern U.S. storm water drainage market. The project marks a homecoming of sorts for the firm, which got its start making pipe in a small factory outside Wilmington, Del.
   "We would load pipe on a truck, go to an ag show in the Midwest, and sell pipe off the truck," says Greg Bohn, director of national engineering, east, for ADS, in an interview. "Today, every full- time employee is a stockholder, and we've experienced phenomenal growth. It's a great U.S. manufacturing success story.
   "The Logan facility will be our largest and most sophisticated new manufacturing facility," said Joseph A. Chlapaty, president and CEO of ADS, at the groundbreaking last fall. "This plant is part of our national expansion program to better service the drainage needs of the New Jersey, New York, Pennsylvania, Delaware, Maryland and D.C. infrastructure markets. By manufacturing pipe as close to our customers as possible, it significantly reduces the time and cost of delivery."
   The Hilliard, Ohio- based company makes smooth interior corrugated high- density polyethylene (HDPE) pipe. It operates 43 plants, all in the Western hemisphere (including 35 in the U.S.) and 30 distribution centers. Its U.S. network is supported by nearly 3,800 employees and what it says is the pipe industry's largest company- owned truck fleet.
   The 68,000- sq.- ft. (6,317- sq.- m.) facility is now rising on 32 acres (13 hectares) sold to ADS by industrial developer DP Partners at its LogistiCenter at Logan business park in the township. The park is served by Class I railroads Norfolk Southern, Canadian Pacific and CSX via the SMS Rail Lines short line, based out of the Pureland Industrial Park in nearby Bridgeport. ADS will take advantage of that service to transport bulk resin pellets into the plant.
   Reno, Nev.- based DP is investing $375 million (up from an originally planned $200 million) in the 1,000- acre (405- hectare) park, its first industrial development in New Jersey. It completed a 359,573- sq.- ft. (33,404- sq.- m.) spec distribution center at the park last summer, which was quickly snapped up by Freightliner.
   DP plans to offer approximately 5.5 million sq. ft. (510,950 sq. m.) of manufacturing, distribution, warehouse, industrial, R&D, office and flex space when the park is fully built out. CB Richard Ellis is marketing the property out of its Philadelphia office.
   "Our location is first and foremost our greatest single strategic edge, due to the availability and cost- effectiveness of land, which enables us to offer highly competitive lease rates, as well as an excellent local work force," said Stephen G. Bailey, DP's Mid- Atlantic regional director, last fall.
   "Anytime you have an opportunity to bring in a company of this caliber with 100 new jobs, it is a tremendous shot in the arm for the township, the county and the state, because it helps everybody," said Mayor Frank Minor of Logan Township. "We are constantly looking for companies to broaden our economy, and ADS will definitely act as a magnet for other manufacturers," he said.
   Those others are lining up. Rastelli Foods was recently approved for an expansion by the township's planning board after initially establishing a plant there in late 2003. Rastelli Global, the company's export division, is located in nearby Swedesboro.
   The community is doing what it can to help the business case of ADS too, recently passing a new storm water management plan.    Bohn says this project is the first start- to- finish construction project in his 12 years with the company. During an 18- month process, his colleagues on the manufacturing team visited several sites in the Mid- Atlantic corridor within a 50- mile (80- km.) radius. They compared land costs to shipping distances, taxes and building costs.
   "Our biggest interest was the I- 95 corridor," he says, which will allow ADS to service customers from D.C. to NYC. That's a far cry from the 40- year- old company's agricultural roots.
   "A lot of our plants are located in rural areas like Williamsport, Pennsylvania, and Perry, Georgia," he says, "places that service those ag markets pretty well. But our primary growth over the past 20 years has been major growth markets for residential, commercial and industrial work like Philly, D.C, Orlando and Atlanta. So we try to balance cost of land with being close to markets we service."
   Helping that large owned truck fleet deliver efficiently is central to that balancing act.
   "A lot of cost is in shipping in the drainage pipe industry," Bohn says. "Being along the I- 95 corridor was a significant manufacturing cost issue. We've experienced explosive growth in the New Jersey area, which we had been servicing from Williamsport. But it got to the point it wasn't as effective when so much was going to New Jersey."
   Ironically, part of what's driving the building of a new plant is an increasing environmental regulatory framework. More underground retention and detention is required, says Bohn, as retention ponds become too costly and too full of liability.
   "As a commercial site such as a new Home Depot or Wal- Mart comes in, they're building on some pretty expensive land," explains Bohn. "It's no longer effective to build on a retention pond."
   So the ponds are going under cover.
   "They're actually putting them under the parking lots," says Bohn, "and they're using our pipe, in 48- inch and 60- inch diameters, to essentially have an underground storage tank. We help maximize land use."
   Asked to describe how the permitting and regulatory processes are to deal with from the end- user side of the equation in constructing the plant, Bohn says, "We have found that the local township has been very good to work with. The mayor and his engineering team have been very accommodating.
   "In general, the New Jersey market is a difficult one," he says of the state regulatory environment. "There are a lot of environmental regulations and specific setback guidelines. It was a significant regulation approval process, but not an uncommon one.
   "When we looked at sites, we had to balance these things," he adds. "You typically pay more for an urban environment, but the payback is being closer to your markets. There is an up- front investment for long- term performance and gain."
   That potential for gain surrounds the new location. Residential developments are also using the underground approach Bohn described. ADS is also involved in road building, landfills, agricultural projects and schools.
   "Anywhere you have construction, you have drainage," says Bohn, explaining that the HDPE product ADS sells is less costly because of its weight – even though that lightweight quality adds to the company's internal costs. He says the cost differential to ADS customers is between 10 percent and 30 percent less than corrugated metal pipe. He says resin shortage has not been an issue, though international demand has driven up prices over the past five to 10 years.    In addition to its U.S. portfolio, ADS operates facilities in Mexico, Costa Rica and Chile. And market proximity is important for more reasons than merely distribution.
   "Because it's shipping- intensive, we benefit in the sense that it's difficult to import it because of the shipping costs," says Bohn. "That's why we're somewhat insulated from international competition. By the same token, if we're going to compete, we have to go to their soil." Up to now, however, the company has stuck with the Americas, where barriers to entry are in its favor.
   Bohn says the local talent pool has been in its favor too.
   "One of the attractions of the area was what appeared to be an ample supply of good candidates to fill jobs like foreman, mechanic, truck driver and forklift operator," he says. /
   The company now has constructed four new plants over the past three years, and is currently expanding its plant in Winchester, Ky. Bohn says one thing the company has learned is to build for the future. The Logan site has ample room for expansion.
   "With the growth we've experienced, we try to accommodate that growth," he says, through such attributes as higher ceilings and more floor and storage space. "We need a lot of outdoor space for storage for our pipe. Ten acres looks great at first, but then you're buying another five or six acres. So we try to be progressive and make sure that there's room for growth."
   ADS is not the only construction- oriented firm choosing New Jersey as a place to grow. Super Stud Building Products, Inc. is consolidating its New York and New Jersey operations at a facility in Edison. The 193- job, $20.2- million project received a 10- year, $1- million grant through the New Jersey Economic Development Authority's Business Employment Incentive Program, which between June 2006 and January 2007 executed such grants worth $43 million to 25 companies.
   How many go to existing businesses? Of those projects, 18 involved relocations from locations that include New York City, Philadelphia, Houston and Rhode Island. Super Stud will also receive a low- interest $10- million loan from NJEDA via the federal New Markets Tax Credits program.
   New Jersey is also in the midst of rolling out its own "shovel- ready sites" program, called "Ready for Growth."
   Asked if the ample brownfield redevelopment market in New Jersey and the region provides room for even more growth, Bohn says, "We're seeing more and more of it. Our product lends itself very much to it. HDPE is an inert material, highly corrosion- resistant. In brownfields, with diesel and oil hydrocarbons, HDPE holds up exceptionally well. In fact, we've done several road and brownfield projects in New Jersey specifically because of that environment."
   A recent Ernst & Young report called attention to the nation's infrastructure deficit. Asked whether that means large market potential for the particular infrastructure niche that ADS serves, Bohn says, "Absolutely. They passed a funding bill last year, but it's still a significant shortfall in terms of long- term needs. We see long- term prospects as outstanding because of the large investment in infrastructure over the long term, and draining pipe will be needed. Because our product is growing at the expense of concrete and steel – it's a way to stretch that dollar further."
   What does that mean for the company's facility portfolio? Bohn keeps things close to the vest, but he does say this:
   "We have very significant growth plans."    "Significant" would be one way to describe BP's Crown Landing LNG terminal project, also slated for Logan Township. For the past several years, the company has been shepherding the project through regulatory and political channels, receiving the go- ahead from the Federal Energy Regulatory Commission in April 2006.
   But age- old disputes about where in the river New Jersey ends and other states begin has led to a legal dustup, with the U.S. Supreme Court in May giving Delaware and New Jersey authorities 45 days to dispute a special master's finding in 2006 that both territories have jurisdiction over construction.
   Such a finding may eventually favor Delaware's objection to the project, citing coastal preservation regulations prohibiting the construction of new bulk terminals on the riverbank. The point of contention is a 2,000- ft. (610- m.) pier that juts into Delaware territory.
   As FERC explained it, "Crown Landing and Texas Eastern are subject to a federal Coastal Zone Consistency Review for New Jersey, Delaware, and Pennsylvania as affected by the projects, but New Jersey claims that the Compact of 1905 between New Jersey and Delaware gives New Jersey exclusive riparian jurisdiction of every kind and nature on its side of the Delaware River." /
   It goes back further than that: Delaware points to a deed issued to William Penn in 1682 that established the entire riverbed as Delaware territory, all the way to the low- tide line on New Jersey's side, and within a 12- mile (19.3- km.) circle emanating from the town of New Castle, Del. A complaint was filed by New Jersey in 1877 (the year of Logan Township's birth), and subsequent skirmishes have occurred with regularity ever since, notwithstanding a 1905 compact between the state that failed to close all loopholes. A 1972 proposal by El Paso Eastern Co. to construct a similar LNG terminal was similarly rejected by Delaware regulators.
   The project would occupy 175 acres (71 hectares) in Logan Township, and would also involve the construction of 11 miles (17.7 km.) of natural gas pipeline in New Jersey and Pennsylvania from the terminal site to BP subsidiary Texas Eastern's existing facilities in Brookhaven, Pa. BP has called the site "particularly attractive because it provides deepwater shipping access as well as ready pipeline access." The facility would receive between two and three LNG shipments a week, which would translate into approximately 15 percent of current natural gas demand in the Mid- Atlantic region.
   The Northeast's need for new sources of energy, including natural gas, is well documented. But LNG terminal proposals up and down the region's coastline have encountered resistance.
   Part of BP's rationale for the project is the potential for further investment and growth attracted by its products. The company estimates spin- off economic activity worth up to $54 million for the tri- state area, in addition to projected annual state and local tax contributions during operation that approach $6 million.
   Meanwhile, the legal tussle continues. Delaware officials, for example, dispute New Jersey's claim that BP's project would require the dredging of 800,000 cubic yards of subaqueous soil, citing more recent filings by BP that put the amount at 1.24 million cubic yards. Attorneys for the state, in arguing for further discovery in the case, said in their Supreme Court filing, "Such discovery is important to the legal claims of New Jersey because the BP project dwarfs anything that might have been contemplated by the parties at the time the 1905 Compact was being drafted and ratified."
   As for New Jersey's wish to expedite the resolution, the Delaware filing states, "The only entity that would benefit from such speedy treatment is BP, and this Court has never allowed the short- term commercial interests of a corporation to dictate the manner in which it resolves a historic dispute between two States."
   Tom Mueller, BP spokesman, says, "We are optimistic that the project is going to go forward, and we are working on plans to move it forward in the coming months." While the company has multiple active LNG projects ithroughout the world, Crown Landing is its only U.S. LNG project.
   Mueller says the project has received strong political support from New Jersey, but "that doesn't mean the regulatory regime is a simple process to work through. It's not. But we're continuing to work through the process with them and hope to conclude that in the coming months."
   He says the economic development case for the project is solid.
   "Clearly the increasing price for natural gas is creating pressure on bottom lines of industrial facilities," he says, noting their movement to overseas locations where gas is cheaper and plentiful. "The Crown Landing project brings to this market a significant new supply of energy, which should help local industries keep their jobs local, and plan a little more consistently for their energy costs."
   BP hopes to start building in 2009, with operational start- up in 2012.