E-cigarette giant Juul will invest $125 million and create 500 jobs in Lexington County, the company announced Monday.
The company plans to fund an assembly and packaging plant in the county as early as this summer.
“This is a great day in Lexington County,” county council chairman Scott Whetstone said. “I’m very energized about the potential that our county has moving forward.”
Representatives for the company met with officials from Lexington County in recent months to discuss the possibility of a plant. Though Juul will fund the project, the plant will be run by a third party contractor, a company spokesperson said.
“We work with a number of partners in our supply chain who contribute to the final product,” spokesperson Ted Kwong said in an email.
State Sen. Katrina Shealy, R-Lexington, said Juul has been looking at a site near Columbia Metropolitan Airport. An airport spokesperson pointed to a property in the Richland-Lexington Airport District Enterprise Park that previously housed Westinghouse.
Job postings online before the announcement showed Juul Labs is seeking to fill two key positions.
A site manufacturing engineer is needed to oversee “high volume manufacturing” processes and coordination with contractors in Columbia, the posting says. And a senior supplier quality engineer — a job posted in the third week of April — is needed to work as a “quality representative at our Columbia site to improve awareness, visibility, communication on quality initiatives to support departmental, functional, site, divisional and corporate quality goals and priorities.”
The addition of hundreds of jobs — Shealy said the company aims to create an additional 300 jobs — will be a boost to Lexington County, which has struggled to grab the attention of big business when in competition with port counties such as Charleston, Shealy said. Manufacturing and assembly requires a way to get the products out, so landlocked places are typically placed at a disadvantage, she said.
The Juul-contracted plant will create “midrange to high paying jobs” to particularly benefit workers in rural areas of the county, such as Batesburg-Leesville, Red Bank, Swansea and South Congaree, she said. And going forward, the presence of a giant like Juul could attract other businesses to the Midlands, according to Shealy.
“South Carolina is a great place for business,” Shealy said. “We have a great climate, we’re a right-to-work state, we don’t encourage unions.”
Shealy said the state did not offer any tax breaks to lure the company. Lexington County council member Darrell Hudson said the county offered some tax incentives, but declined to offer specifics. Council chairman Whetstone said he would not comment on incentives either.
South Carolina allows companies that vow to invest at least $2.5 million in the state over a five-year time frame to request a deal that would allow the company to pay a fee instead of property taxes. Lexington County council regularly considers and offers fee-in-lieu-of-tax agreements to companies such as Nephron Pharmaceuticals and Nucor Corporation.
The county’s director of economic development, Michael Eades, said any tax agreements will be made public before county council’s public hearing on May 28.
More than a dozen stores in Lexington County carry Juul products.
Juul has become a major player in the world of e-cigarettes, easily outselling competitors and pervading U.S. culture at lightning-fast speed. The company, based in San Francisco, is expecting $3.4 billion in revenue this year, according to Bloomberg, and reportedly earned $12.4 million in profits in 2018.
Juul markets itself as having an innovative design that delivers a stronger hit of flavored vapor — made of nicotine salts — without the tar of cigarettes. The company’s e-cigarettes also became popular because of their size: About as big as a USB drive, and rechargeable when plugged into a computer. The company sells different flavor “pods” which can be purchased and inserted into any Juul. Each pod offers about 200 puffs and is equivalent to a pack of cigarettes, according to the company’s website.
However, what started as a marketing campaign that claimed to target young professionals wanting to quit cigarettes soon came into question as teens took to Juuling. Juul has come under scrutiny over the past couple of years for not regulating sales to minors tightly enough.
Captain Adam Myrick, spokesperson for the Lexington County Sheriff’s Department, said vaping is very common in county schools.
“It is a significant problem in our schools and we are working with school administrators to address the problem,” he said.
The S.C. House and Senate passed a bill barring minors from entering stores that sell vape products without an adult. That bill was signed by Gov. Henry McMaster on April 26.
And some local governments, including Lexington County and the City of Columbia, have discussed cracking down on vaping with ordinances. Those efforts have been challenged by controversial bills that would ban local governments from passing regulations on cigarette and vaping products, among other things.
In recent months, Juul has made moves to improve its public image — a large banner on its website now displays a warning about nicotine being addictive and the company is supporting legislation to curb underage use — and has ramped up lobbying efforts, too. There are six registered Juul lobbyists in the Midlands, according to the South Carolina Ethics Commission. The company also formed an employee PAC in March 2018, Politico reported in December, and the PAC donated to more than a dozen attorney general campaigns, including that of South Carolina’s Alan Wilson.
Juul also received heavy investment from the Altria Group, a tobacco conglomerate and frequent campaign contributor to South Carolina politicians.
Correction, 1:31 p.m.: A previous version of this article misstated the level of Juul’s involvement in the assembly plant. The plant will be operated by a third party contractor, but funded by Juul.