Disregard. I found the issue.
This part of the game appears to be working and it was my fault (I hope, will find out).
The issue: I have been running my terminal day and night and not collecting from the residential buildings. I was purposly running down my population trying to get a jump on the tunnel task to increase population when I get there. In doing so, I ran my pop below the limt for the amount of factories I had. I just need to add 1,000 or and I should be able to get it back out, not the 20k+ I thought I needed.
The message to get a building out of storage doesnt tell you how much pop you actualy need and the shop shows how much to add a new factory. Got confused.