Workers build an addition July 12, 2016, to be used for a new machine that cuts rolls of paper into sheets along with shipping and receiving at J.S. McCarthy Printers in Augusta. Joe Phelan/Kennebec Journal file

AUGUSTA — An Augusta printing company will build additional warehouse space at its plant after securing city approval for its construction plans and a tax financing deal.

The latest project extends J.S. McCarthy Printers’ string of expansions along Darin Drive on Augusta’s west side that dates back more than a decade.

The proposed addition would be a 13,600-square-foot warehouse to store printed packaging for pharmaceuticals and food.

“The type of work we’re producing requires extended runs that need to be kept on-site and in a controlled environment, and then shipped across the country, as required by the customer,” Rick Tardiff, chairman of the company’s board, said at an Augusta City Council meeting earlier this month.

While the company has been producing printed packaging for several years, the global COVID-19 pandemic has increased demand.

The expansion, including equipment, is expected to cost more than $4 million, Tardiff said.

Company officials applied for a tax increment financing deal from the city, and city elected officials have approved it.

Under the revenue-neutral deal, the city will be able to shelter the increased value that the project is expected to generate from calculations for state revenue sharing, state school aid and Kennebec County’s tax assessment.

“The valuation increase on this project is $400,000,” Keith Luke, economic development director for the city of Augusta, said in explaining the calculations to city councilors. “It will yield $8,000 a year in new tax value.”

Half of that will be returned to the company for 20 years, totaling $80,000.

“It’s a relatively modest incentive to the company,” Luke said, noting it is the fifth TIF city officials have approved for the business.

The expansion, he said, is good news for the company and city of Augusta.

Company officials declined comment for this story.

Press operator Mark Madsen, left, waits to restart the new Heidelberg press while press room manager Randy Robbins pulls a pallet of finished sheet out Aug. 17, 2018, at J.S. McCarthy Printers in Augusta. Joe Phelan/Kennebec Journal file

This project continues the company’s string of expansions, which has included installing paper-cutting machinery in 2016 and adding a new printing press in 2018. Along with expanding the company’s capabilities, the moves have also increased efficiency and reduced waste.

The company, with 150 full-time employees, produces a wide range of products at its Augusta plant, from business cards to perfect-bound books.

In 2020, the company formed an employee stock ownership plan, which puts the company’s ownership in the hands of its employees.

About a year ago, shortly after the global COVID-19 pandemic was declared, the company laid off many workers, but continued working as an essential business.

It put in place a number of measures designed to keep workers safe, including changing shift times, allowing people to work remotely, where possible, and limiting outside visitors.

At the time of the TIF vote, Ward 4 Councilor Eric Lind noted J.S. McCarthy employees who had been laid off had been brought back to work.