March 12, 2010

Closing of plant like a 'family' dissolving

ANN S

— By . KIM and NOEL K. GALLAGHER

click image to enlarge

Gregory Rec/Staff Photographer... Rick Bryan, owner of Casco Bay Transportation, pulls a tie-down strap over a load at Wood Structures in Saco on Tuesday, March 17, 2009. Bryan was hired by Hancock Lumber to get their order off the Wood Structures lot before the bank takes over the property and other Wood Structures assets on Wednesday. Bryan said he worked at Wood Structures for 20 years and still had many friends who worked there though he left the company some years ago. "It's a tragedy for the community," he said of the company's closing.

click image to enlarge

Gregory Rec/Staff Photographer... The entrance to the Wood Structures warehouse in Saco on Tuesday, March 17, 2009. The company, which employed 170 people, has closed due to the bad economy.

Staff Writers

SACO — Another 180 people are out of work with the closing of Wood Structures Inc.'s manufacturing plant here and its offices in Biddeford on Monday.

The four-decades-old company, a maker and distributor of manufactured wood products, had filed for Chapter 11 bankruptcy protection earlier this month as it sought to reorganize. But workers were informed Monday that their employer was unsure whether it could continue to pay them, and had decided to close.

Wood Structures expects to file this week for Chapter 7 bankruptcy, a different legal proceeding in which a business is liquidated. The company told employees in a memo that they would be on an ''unpaid leave of absence'' and that their future employment status would be determined by the trustee in charge of the case.

The company has to liquidate its assets because it was unable to reach an agreement with its creditors, said Frank Paul, chief executive officer.

The company, which sells primarily to lumber yards in New England, has been struggling in large part because of the sharp drop in new housing construction. Housing starts in the region are down 63 percent since 2005, according to documents filed by the company in U.S. Bankruptcy Court.

''There's just not enough business to go around,'' Paul said.

The closure of Wood Structures follows another recent blow to the area's manufacturing base. Earlier this month, RR Donnelley announced the shutdown of its Wells plant, which will put 374 people out of work.

These job losses are too recent to be included in the latest unemployment rate for York County, which hit a not-seasonally-adjusted rate of 8.2 percent in January. State unemployment rose to the seasonally adjusted rate of 7.8 percent for the month, a 16-year high.

Manufacturing has been one of the hardest-hit sectors in Maine, along with construction and retail, since the recession began in December 2007.

''It's sad, it really is,'' Paul said. ''The true victims of all of this are the poor people who are without a job in a very, very difficult job market.''

The Saco facility was quiet Tuesday. Large stacks of raw lumber and some finished trusses sat in the lot, located in an industrial park near the Maine Turnpike. Bobby Banville, a hired trucker, was picking up an order for Hancock Lumber.

Manager Chris Friel was the only employee in sight, wrapping up some paperwork. The news Monday wasn't a complete surprise, but it was still hard on the workers, he said.

''We knew we were struggling this year,'' Friel said.

More than half of the employees, he said, have been with the company 15 years or more. Friel said he has worked there since 1975.

''That's the thing that really hurts,'' he said. ''These people worked really hard, and then this happened. We were a family here, and now it's like the family is disbanding.''

Wood Structures was unable to provide employees with severance -- it will be up to the trustee to decide how to handle that, Paul said.

Employees who belong to Local 1996 of the New England Regional Council of Carpenters will be owed a week's pay for every year of service, said Bob Burleigh, the union's industrial representative. Severance and vacation pay will be among the issues pressed by the union during bankruptcy proceedings.

Union workers earned wages ranging from about $15 to $25 an hour and received benefits, including health care, a retirement plan and paid vacation.

''They were very good jobs,'' Burleigh said.

He said the company has clearly been struggling for several months. There have been a series of layoffs since September, although some of them were temporary and workers expected to be called back. About 50 union members were still working when the news of the closure came Monday, he said.

Mayor Ron Michaud expected the loss of so many workers to have an impact on the local economy. He said businesses that cater to employees, such as gas stations and sandwich shops, would feel the effects.

''It's a tragedy for York County, for Saco, but primarily for the employees,'' Michaud said.

Local merchant Beth Johnston, co-owner of Vic & Whit's deli in downtown Saco, said the Wood Structures closing is just the latest in a string of bad news.

She gets customers all the time who say their hours are being cut, or they are losing their jobs or businesses.

''I don't think there is anybody who isn't affected,'' she said. ''Even people with jobs are cutting back and saving money.''

Wood Structures got its start in 1966. Trusses were originally a sideline business that proved to be a good choice as demand for prefabricated materials grew. The company sold to 375 lumberyards in New England and had the largest market share in the region, according to court documents.

Originally started as part of a franchise program by lumber manufacturer Weyerhaeuser Co., the company has gone through several ownership changes. The current owner, Atlanta-based Roark Capital Group, bought the company in 2005.

Staff Writer Ann S. Kim can be contacted at 791-6383 or at:

akim@pressherald.com

Staff Writer Noel K. Gallagher can be contacted at 791-6387 or at:

ngallagher@pressherald.com

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