Published 10:40 pm Thursday, October 22, 2009
FRANKLIN — Area residents and community leaders struggled to come to grips with Thursday’s announcement that the Franklin mill — which employs 1,100 people — would be completely shuttered by this spring.
“It was a complete shock, and we’re devastated,” Isle of Wight Supervisor Bradshaw said following the morning announcement. “This is just like a death to our family. It’s going to be something that is going to take us a long time to get over.”
“This is devastating news to our employees, devastating to their families and devastating to the community,” Franklin Mill Manager Jeannine Siembida told a crowded conference room filled with community leaders and the media. “This facility will not make paper again. This is a permanent closure of the facility.”
Siembida said the company also would close containerboard mills in Pineville, La. and Albany, Ore., and permanently shut down a containerboard machine that is currently idle at its Valliant, Okla., facility. The closures will impact about 1,600 employees total.
“We’ve had a great decline in the market with the global recession,” Siembida said. “Our sales are down 20 percent year over year. That’s a huge chunk of demand that has been taken out of our system. We’ve been managing this demand loss through the year with very costly downtime. (But) it has become clear to us that the market is not returning, so we’ve had to take a permanent reduction in capacity.”
According to IP, the shutdowns will collectively reduce the company’s North American paper and board capacity by 2.1 million tons.
“It is not a reflection of the employees of this facility,” Siembida said. “We’ve done everything possible to make this a competitive facility. We are simply caught up in this global recession and the demand decline.”
Siembida said the company would begin shutting down the first paper machine at the Franklin Mill on Nov. 7, and the remaining machines would be shut down in phases through the spring. She added that layoffs would begin “several weeks” after the initial machine shutdown, but an exact timetable for the layoffs had not yet been decided.
“I’m proud of the employees here,” Siembida said. “We have done everything possible that the company has asked us at this facility. We can honestly say that we have done everything that we can. We are just caught up in this global recession. We’re committed as a company to matching our supply with our customers’ demand. We simply can’t run if we don’t have orders to fulfill.”
Asked why the company decided to close the Franklin Mill, Siembida said, “The decision was based on a number of reasons. There were many options investigated as to where to take the capacity out. The main reason is the mix of this mill. We are an uncoated freesheet and coated paperboard (facility). That’s where we’ve seen the biggest decline in the marketplace.”
Government officials from Franklin, Isle of Wight and Southampton sat in stunned silence during the press conference. The news was especially shocking to Franklin Mayor Jim Councill and Phillip Bradshaw, who were recently assured by IP officials that the mill was on solid footing.
“We just had a meeting last week with the management from this mill with other community leaders,” Bradshaw said after the press conference. “It was a very upbeat, positive meeting. We felt very good. (Councill) and I had even talked about it afterwards, about how upbeat it was. We both reassured each other that we were expecting the longevity of this mill to last longer than what we had thought.”
Bradshaw is a former IP employee and represents the Carrsville District, where the mill is located. He said the mill represents 25 percent of the direct tax base for Isle of Wight County.
Councill said he was equally surprised and disappointed by the news.
“I think we all suspected that there was a possibility of (the mill closing) way down the road,” Councill said. “We had no idea how imminent it possibly could have been.”
The mayor added that his first thought was for the families that would be affected by the mill’s closure.
“How are they going to feed their families?” Councill asked. “How are they going to pay their mortgage? It just breaks my heart to think of the challenges that we are going to be faced with right now. Our entire economy relies upon the (mill’s) employees and the ancillary businesses that are supported by them. (We) are completely dependent upon this mill.”
“It’s so sad, it’s like losing a part of your family,” Suffolk Mayor Linda Johnson said Thursday night. “It’s not just Franklin, it’s South Hampton Roads.”
What happens now?
In a statement released soon after the announcement, Gov. Tim Kaine promised that the state would quickly step in to set up a task force designed to help displaced workers find employment, education and resources.
Franklin, Isle of Wight and Southampton officials plan a meeting next week to decide how they can help in that process and to ramp up their economic development efforts.
“We’ve got to go to work,” Councill said. “We’ve been working hard to bring in other industries, to diversify. We knew that needed to be done. All three of us have worked very hard, with little success because nobody is moving and nobody is doing anything. But we’ve really got to put in a full-court press now. We’ve got to do something so people can work here.”
He added, “It’s too nice of a place to live and not have a job.”