Dive Brief:
- USG Corp., a maker of drywall and other construction materials, will invest $1.18 billion to build a production facility in Orange, Texas, Gov. Greg Abbott announced Thursday.
- The Chicago-based company plans to make an initial project investment of $650 million, and it expects to create nearly 200 jobs, according to a news release. No construction or operational timeline was disclosed.
- The investment expands USG’s manufacturing footprint in Texas, where the company has facilities in Dallas, Galena Park and Sweetwater. It is a qualified project under the Texas Jobs, Energy, Technology and Innovation program, which was created in 2024 to attract new jobs and investment to the state.
Dive Insight:
USG, the maker of Sheetrock drywall, Durock tile backer and other gypsum-based products, has been in talks to expand to Orange for over a year. The city had cleared the way for the company to take over a shuttered International Paper mill, rezoning the land in 2024 and approving incentives in early 2025, local ABC affiliate 12NewsNow reported. Nearly 500 people lost their jobs when the mill closed.
Construction of the USG facility was set to begin as early as fall 2025 and be operational by early 2028, according to the city’s Facebook post on Jan. 29, 2025.
What happened between then and now is unclear. Mayor Larry Spears and USG did not immediately respond to requests for comment.
“This new plant builds upon our hundred-year-old roots in Texas” and “reflects our continued commitment to our customers’ success and the state’s prosperity,” USG CEO Chris Macey said in a statement Thursday.
The Orange project qualified for economic incentives through the JETI Act. The act allows a company, school district and the governor’s office to enter into an agreement for a 10-year school district maintenance and operations tax appraised value limitation of 50%, based on qualifying job and capital investment minimums, according to the governor’s office website. Projects located in qualified opportunity zones are eligible for an additional 25% limitation on taxable value.
USG partnered with Little Cypress-Mauriceville Consolidated Independent School District through the JETI program on this investment. District superintendent Stacey Brister called it a “tremendous opportunity” for workforce development and training in Orange.
“We are committed to preparing our students with the skills, experiences and mindset necessary to succeed in high-demand careers, and we look forward to working alongside USG to build a strong, future-ready workforce for our region,” Brister said in a statement.
On April 28, Orange city council members unanimously voted to amend the construction timeline of a Chapter 312 tax abatement agreement at 80% over a 10-year period for USG’s project.
USG was founded in 1902 through a merger of 30 independent gypsum and plaster companies, according to its website. It would later use its Sheetrock to construct Chicago World’s Fair exhibits in the 1930s and eventually expand its operations and product offerings to serve markets in Canada, Mexico and the Caribbean. The Knauf Group, based in Germany, acquired USG in 2019 to expand its presence in North America.
USG currently has more than 70 locations and employs 8,500 people, including more than 40 manufacturing plants in the United States, according to its website.
