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Shelter Products set to leave Phil Campbell

While there is marked disagreement about how and why it happened, the town of Phil Campbell will soon lose an important local industry when Shelter Products, LLC, relocates to Haleyville.

The company, operated by Mark and Stephen Sampson, is expected to move to Haleyville later this summer after negotiations to purchase their 50,000-square-foot facility in Phil Campbell broke down.

Shelter Products is a wholesaler of building materials that distributes primarily to the manufactured housing industry, according to Stephen Sampson. Located in the former Kellwood facility on Hardin Hester Drive in Phil Campbell, the company started operations in 1998 as BRC Components and was owned by Cavalier Homes. The Sampsons purchased the company from Cavalier 15 years ago.

According to Phil Campbell mayor Steve Bell, Shelter Products leases the facility from the town, which was deeded the facility by Kellwood after it closed and relocated to Mexico in the 1990s. Bell said Shelter Products pays $1,000 per month on its lease with Phil Campbell.

When his company moved into the facility, Sampson said they footed the bill for “gutting it and converting it for distribution,” as it was set up as a textile operation. Sampson said Shelter Products received a 20-year lease from the town of Phil Campbell, then later received a 20-year extension of that lease for a total of 40 years.

With more materials coming in, Sampson said Shelter Products is a growing business in need of more space. Faced with the dilemna of not owning the property where the business is located, the Sampsons reached out to Bell and the council about purchasing the property.

“They put it on the city council agenda in April," Sampson said. "Then it was two meetings before they talked about it, because there weren't enough  of them at the meeting to have a quorum. It was two months before we got an answer.”

When that answer came, Sampson explained, he wasn't pleased.

“The mayor said they would need an appraisal done and would go with the appraised price," Sampson said. "We're in the process of looking at buildings, and we found two that would basically double our size for the same price we could build on to our existing complex.

"They also told us that if we bought it, they'd pay for the appraisal. But if we didn't buy it, we would pay the $3,500 for the appraisal cost. I told them I'm not going to put $3,500 into something we're not committed to buy, and if we had to pay the appraised price, that was going to be too high.”

Sampson said the 15-employee company was looking at adding a 19,200-square-foot addition to the property. The company had a large shed constructed several years ago, at its expense, and Sampson said the lease provides that whatever they put up they can take down at their own expense.

“But we obviously can't take down and move a 19,000-square-foot building,” Sampson said.

The brothers found a 90,000-square-foot facility in Haleyville and have signed a sales contract on that property. Assuming the title work and legal prerequisites are satisfactory, he expects Shelter Products to move “by early September.”

Sampson said the purchase price of that facility was close to the same cost the company would incur to add a 19,200-square-foot building in Phil Campbell. And they had no intention of doing that unless a purchase of that property could be worked out.

Sampson, who serves as chairman of the Phil Campbell Water and Sewer Board, the Phil Campbell Industrial Board and is on the Franklin County Development Authority board of directors, said they were willing to work with city officials to negotiate a fair purchase price but were never given that opportunity.

“The only thing I was told is what would it look like if they give us a building. I never asked them to give us the building,” Sampson said. “We needed a low enough price to justify staying. The only thing I told them was we could not afford to give more than $100,000, because we found something else at that price level. That would be the top limit stretching our budget. It was the only price ever thrown out there, and it was the one I said.

“I don't feel like a serious effort was made to keep us in Phil Campbell. Nobody contacted us. Nobody from the city did anything. I've got a feeling they already have it in place for another business to go in there. Otherwise, why not come talk with us and say, 'What can we do to keep this business in our city?'”

Bell said he told Shelter Products company officials an appraisal was needed as a starting point for negotiations.

“We were going to give consideration for all the lease payments they have made and the time they've spent there,” Bell said. “But with his [Stephen Sampson's] close association with the city, we wanted to be very careful not to commit an ethics violation.

“The council authorized me to negotiate with them, but we never got to the negotiation stage. I believe they had already made the decision to move because they had already identified a building. The only price they discussed, $100,000, was basically giving it to them, and we did not feel that was good use of taxpayer money to give it to them for that price."

Bell confirmed the city's proposal that if Shelter Products purchased the property, the city would absorb the appraisal cost, but if a deal fell through, the city could not afford to incur that cost absent a completed sale.

“If you look at the tax maps, the appraised value on the Franklin County tax maps is $1.3 million," Bell said. "I understand that's inflated. We were willing to take into consideration their lease payments, but unfortunately it never got that far. By the time we got to where we were ready to negotiate, they already had their minds made up to move."

Once Shelter Products vacates the facility, Bell said the town's two options will be to sell the property or search for a new tenant. 

“We have someone interested in a building in Phil Campbell, and this property fits what they're looking for," Bell said. "But you never know if that will materialize until it's done."

Bell said he and the city council did everything they could to allow for serious negotiations of the sale of the property to Shelter.

“They had already started looking at other buildings when they came to us," he said. "The only conversation we had with [Sampson] was where he said he'd have to buy it at $100,000 in order for them to come out of this okay financially. It never got to the point of negotiating.

"We just wanted to make sure we didn't get into any trouble. Public perception is number one, and then there are ethical considerations [in] doing a deal with one of our own folks."

As for Sampson's future on the board, he plans to remain but doesn't anticipate being asked to serve another term.

“I'm sure when my term as chairman comes up, they probably won't put me back on it because I don't have a business in Phil Campbell,” Sampson said. “But the bottom line is, nobody on the council has a business in Phil Campbell either. Nor does the mayor. None of them even work in Phil Campbell."

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