ROARING SPRING, Pennsylvania (From news reports) -- Appvion Inc. officials announced Monday they will close the Spring Mill, which has been operating since 1866, this spring and nearly 300 jobs will be lost.
Altoona Blair County Development Corp. President and CEO Stephen McKnight said he had been in touch with company officials.
"They confirmed they will be ceasing operations in late March or April. In the best economic times, this would be devastating news for the local workforce, their families and our community. In the current global climate, it's even worse. We are shocked and simply at a loss by this sudden announcement," McKnight said.
The pandemic apparently played a role in the company's decision.
"Appvion officials told us that the continued market constraints brought by the pandemic and resulting restrictions has wreaked havoc in an already volatile and competitive carbonless paper market. While most of Blair County's core industry base has managed to maintain operations up until this point in the crisis, I am very concerned that we risk additional downsizings or even closures if the pandemic-related restrictions continue much longer. We must find our way back quickly," McKnight said.
Company employees received the news at 8:45 Monday morning.
"We received the WARN Act notice this morning," said Mitchell Becker, president of United Steelworkers of America Local 10-00422, about the federal law on the closing of a company. "They are giving us 60 days' notice. They can close anytime between now and April 15 but under the law, they must pay us for 60 days. I had worked there for 25 years, many of them as union president, this is not the way I wanted to end up my papermaking career."
Becker said the mill employed 243 hourly and 50 salaried employees.
Robert Kutz, president of the Blair-Bedford Central Labor Council, called the news catastrophic.
"It has been a staple of Blair County for a long, long time. Generations have passed through there with family sustaining wages. We've had nothing but the loss of manufacturing jobs for the last four years left and right here in Blair County. To lose this one is even more devastating. They had done a lot of improvements and poured a lot of money into that plant," Kutz said.
"It is not a good thing for Blair County. There is a major spin off from that plant, there is a ripple effect for trucking companies that haul black liquor and wood chips."
Local elected officials were not happy to learn of the mill's closing.
"It was a surprise to everyone, even the folks at the plant. Normally, we would try to negotiate something; that we weren't reached out to in any way is troubling," said state Sen. Judy Ward, R-Blair. "We are all in shock. It will be devastating for southern Blair. It is a very troubling story."
State Rep. Jim Gregory, R-Hollidaysburg, said, "It is a loss like our county has not seen very often but been happening more regularly when ownership is from out of state making decisions. I feel for the people who are losing their jobs, the ripple effect will be far reaching."
U.S. Rep. John Joyce, R-13th District, also was disappointed.
"It is incredibly disappointing that Appvion Inc. has chosen to close its Roaring Spring paper mill. Our region is home to a committed workforce -- an asset both to our robust manufacturing industry and to our community. Losing these workers would be a great detriment to our region, and I will work with employees affected by this announcement to keep these dedicated Pennsylvanians working within our community," Joyce said.
The immediate priority is the local workforce.
"We have activated the regional workforce response team to ensure we can place as many of these highly-skilled manufacturers as possible within our labor shed," McKnight said. "Later, we will turn our attention to marketing the facility for potential operators. This will take the entire community to come together and help.
"ABCD has reached out to the governor's office and will work closely with our elected officials to do what it takes to keep our friends and families local while maintaining the facility for a future use. We expect to work with Appvion as that process unfolds in the coming months."
"What we will do now is to try to get those workers the assistance they need ... so they can get back on their feet. We will do what we can to make sure the workers get help and make them aware of jobs that are available," Ward said.
The mill was founded by Daniel M. Bare and his partners John Elby and John Morrison in 1866.
The mill operated as D.M. Bare Paper Co. until 1946 when it was purchased by the Combined Locks Paper Co. of Combined Locks, Wis., later to become Combined Paper Mills. In 1969, Combined Paper Mills was acquired by the National Cash Register Co. and in 1971, it was merged with Appleton Coated Paper Co. to form Appleton Papers.
Over the next 20 years, Appleton Papers operated under several domestic and foreign owners until November 2001, when employees purchased the company. Appleton Papers changed the name To Appvion Inc. in May 2013.
Appleton, Wis.-based Appvion had filed for bankruptcy in October 2017.
In June 2018, Appvion completed the sale of substantially all of the company's assets to a group of lenders led by Franklin Advisers Inc.
The total consideration was about $365 million, plus the assumption of substantial liabilities, including many of the company's contractual obligations.
The transaction was to significantly reduce Appvion's debt, provide additional liquidity and better position the company to compete long-term on the evolving specialty paper market. It also allowed the company to further invest in the innovation that had made it a market leader, according to a company press release.
In October 2019, Appvion and the United Steelworkers Local 10-00422 reached an agreement to restructure the company's integrated pulp and paper mill in Roaring Spring.
The new agreement provided a framework for a more efficient and cost effective operating structure while maintaining the current operating volumes at the facility.
The restructuring agreement called for a permanent reduction in the workforce at Spring Mill over the next several months. As part of this agreement, there was to be a severance package offering for up to 50 employees based on seniority.
Prior to the closing of the transaction, the company reached an agreement with the United Steelworkers Union on new collective bargaining agreements for Appvion manufacturing facilities in Roaring Spring, Appleton, Wis., and West Carrollton, Ohio. The new three year agreements, which were ratified at the end of May 2018, covered about 830 Appvion employees.