In 1889 the community of Lebanon was abuzz when it was announced that the O’Neill brothers were building a large paper mill in Lebanon, just north of town. The site was chosen because of two factors: first, there was a millrace (the Lebanon Canal) providing water from the Santiam River without the danger of periodic flooding, and second, the availability of straw. In 1890, 60 houses were built in Lebanon. Since the city’s population was around 750 at this point, one can… see the town was undergoing a major growth spurt. The Lebanon Paper Company put Lebanon on the map, changing the face of the town from an agricultural trading hub to a place of manufacturing and industry, with the Lebanon Express stating, in 1890: “There is no town in Oregon with brighter prospects than Lebanon.”
The mill was fully operational by 1891 and at the start employed about 60 people (this would expand to over 300 by the 40’s and 50’s). In 1895 a spur was built to connect the mill to the Southern Pacific Railroad tracks. For the first years of operation the mill used straw to make paper, and huge stacks of straw were maintained near the mill. In 1903 the mill converted to wood pulp and there were large log ponds just to the north west of the main plant. In addition to paper products, by the 1950’s, Zellerbach was selling a line of chemicals (for use in production of insecticides and other agricultural sprays) derived from the production of paper under the “Orzon” brand.
A series of mergers produced the “Crown-Willamette Paper Company” in 1914 and then “Crown Zellerbach”, who then operated the mill until it’s closing in 1980. During this period it was always one of the top three employers in Lebanon.
Today, about the only visible trace of the mill would be the water tower that’s located near the old Elkins Flour Mill, not far off of industrial way.