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8/28/08
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16 comments
Union boss ‘Tired of being lied to’
Brookfield move to shut down mill indefinitely contradicts its plans to run all winter
MILLINOCKET, Maine — Multibillion dollar conglomerate Brookfield Asset Management lied about its plans for the Katahdin Avenue paper mill it will close indefinitely, a union president said Wednesday. United Steel Workers Local 152 boss Louis Ouellette and other union officials minced no words when asked how Toronto-based Brookfield, an asset management firm, had handled its decision to indefinitely shut down the Katahdin Paper Co. mill on Sept. 2. The decision was announced Tuesday. “I am just so tired of being lied to,” Ouellette said Wednesday. “For the last week, they have been telling us they are going to run all winter on one boiler and that things were just so positive. Then they slammed us yesterday.” “People are bitter and I don’t blame them for it. This was done in a less than optimum way, no question,” said Duane Lugdon, a representative for three United Steelworkers International unions at the Millinocket and East Millinocket paper mills. Denis Couture, Brookfield’s head of communications, denied that the company had lied. He said the mill would reopen, but could not estimate when. “Nothing has been abrupt in that the employees have known it [the mill] was not making money and we have been working for months to improve the financial performance of the plant, unsuccessfully,” Couture said. “In our view, this is simply a business story,” he added. “We have done the only thing we can do to protect the interests of all of our shareholders and that’s the indefinite shutdown.” Couture was not directly involved in the shutdown decision and didn’t know who made it. He referred comment to Peter Gordon, a managing partner at Brookfield and chief executive officer of Fraser Papers, a Brookfield subsidiary that manages the mill. Gordon was out of the office on Wednesday. Ouellette and other millworkers said that the on-the-ground managers of Katahdin Paper Co. were pawns to the company’s distant and indifferent parent corporation — Brookfield. Brookfield is a wealthy conglomerate that owns $95 billion in assets. It netted $110 million in income in the second quarter of 2008, down from the $153 million net income recorded in last year’s second quarter, according to brookfield.com. And like Gov. John Baldacci, mill Manager Serge Sorokin didn’t learn of the shutdown until just before it was announced. “The local management did get blindsided with the timing of it,” Lugdon said. Katahdin Paper first announced on May 29 that oil prices would force an indefinite shutdown on July 28, laying off about 208 workers, unless an alternative energy source was found. Lugdon said the Brookfield-propelled announcement in May was a major setback for the mill and he criticized Brookfield for failing to back a Katahdin plan to install a biomass boiler at the mill a year ago. The announcement, he said, forced satisfied customers to look elsewhere. Also Brookfield should much earlier have seen the danger of having only oil as the mill’s sole heat source for steam vital to papermaking. Yet the workers, management and local sales teams overcame the setback. “Everyone was pulling together to make it work and it started to seem to work,” said Ouellette, whose union represents about 75 workers. “The good news all started rolling in about them finding different things that were working.” Ouellette described three meetings held between June and Aug. 22 in which managers stressed that the mill was meeting sales, production and energy-saving goals and that talks were going well between mill officials and alternative energy providers who seek to install biomass boilers at the mill. But then this week’s shutdown notice came. Baldacci expressed disappointment Tuesday in the decision’s abruptness and stressed that Brookfield Chief Executive Officer Peter Gordon had committed to reopen the mill in 2009 if the biomass talks went well. But Brookfield hasn’t said anything publicly or announced a timeline for the mill’s restart, Ouellette said. “What is missing from the picture is Brookfield management,” Ouellette said. “They have to make a commitment to employ people and make paper.” Couture stressed Wednesday that Brookfield’s commitment to the mill has been shown in its acceptance of millions of dollars in losses in running the facility over the last few years. He refuted Millinocket town councilor Scott Gonya’s claim that the mill had been making millions of dollars recently. Fraser suffered a net loss of $15.6 million in the second quarter, an improvement from the net loss of $19.1 million in the first, according to the Web site www.fraserpapers.com. “The mill cannot be making money at the current energy prices in the very depressed paper market. These are false allegations,” Couture said. Lugdon and Ouellette agreed with Gonya that the mill has made money in recent months. Only Brookfield’s fear of losing money in winter, when the cold forces the mill to burn more oil, creates in the parent company’s view the need for the shutdown, Lugdon said. Couture, Ouellette and Lugdon agree on one point. They hope the biomass negotiations succeed and the mill can reopen soon. “We can do it,” Ouellette said. “We have handled everything that has been thrown at us. But you get tired of dealing with it.”
Comments
Well this is reality and part of the busienss world today. The Union folks has to take some responsibility here as the deals they negotiated over the years have put our industries in an uncompetitive place....Unions had a place but , with the employment laws today, it is only a hinderince for mgt and ee's to work together for commom goals. I am not sure of the whole story but the employees should be asking the question to management on what do we have to do to get this mill back on track. The union(s) will almost definitely not take any responsibility for contributing to the demise of this mill. First of all I would trust our local management a lot more than a bunch of investors from Toronto when it comes to the issue of the company's profit. We have been told for the past 3 months by our mill managers and others in managment positions that the Millincoket mill is making a profit. And why shouldn't we be? We have reduced the steam use over the last few months by at least 15- 20%, resulting in less boilers running and less oil used. We are now using a less expensive groundwood stock from the East Millinocket Mill rather than the higher priced TMP used in years past. The grades of paper we make in Millinocket have a good market right now and our quality and performance in the press shops have allowed us to attract the better quality, higher paying customers. At least we could before the initial announcement of the mill closing. But if you are a customer, why would you want to take a chance of your supplier not being there in a month or so and then you are left high and dry with no paper? Ever since the initial announcement, something has sounded off to me. I mean this is the first time the mill has made a profit in the 4 or so years since it opened and they are going to shut down? I understand that oil is expensive, but with the weak US dollar and transportation costs the way they are, it seems to me that it would be harder and harder for northern European (our biggest competitors in this grade paper) and other overseas companies to compete. This is why, I for one am skeptical that we are hearing the entire truth here, I mean something just doesn't make sense. Look at the 100+ year old mill, in a declining, almost dying industry, the greed thats been a staple in the Millinocket region for years and figure it out. I know for a fact that some of the camps on lakes in the region, that at one time were on land LEASED from the mill, were made from materials simply taken from the mill, or STOLEN I should say. The people in Millinocket lived in a bubble fantasy land for a long long time and low and behold now reality sets in. New Trucks and snowmobiles yearly, boats, 4 wheelers, lavish living. All supplied by the mill. The paper industry is in its death throes in part because of the internet and technology advancing rapidly as a whole. Look beyond your little valley at other mills in other parts of the country and you will find very,very few turning a profit. Its BUSIENSS. They owe you people NOTHING! These unions have helped suck the life out of it as well, always wanting more money, time off, increased benifits. Well now you have to wake up and join the rest of the world.I have ZERO sympathy for Louis Ouellette and all the other whining union folks. you made your beds, lay in them. Beyond your little closed off world, the rest of society is laughing at you as well because you come across as nothing more than spoiled brats who finnaly had the word NO said to you. Reality of doing business today? The people you can not reach (Mr. Gordon) are making more money now than ever while we union employees are taking concessions. Look up the facts downbeat, ceo getting bonuses while companies are losing money. Closing plants here so they can move them overseas. That's the reality of business today. The union is tired of being lied to, want your bot-bot too. If your soo tired of the pain, then why in gods name would you have the three stooges Allen, Michaud and Baldacci as your saviors. Its hard for me to admit this, but the mill isn’t coming back, but that’s not to say we can not attract other business. Ask yourself why has the three stooges not been more proactive in the second district, why are there no other manufacturing coming into replace these collapsing mills, and what fool gave these crooks a honker of a TIFF. Millinocket needs to get medieval on the Canadian Crooks, or even in death these hockey ring rejects will be calling the shots.
While in Denver, Baldacci says the mill will reopen next year with a biomass boiler that will end the mill’s total dependence on oil, but if you believe that you should be tested for crack. Baldacci doesn’t care if The People believe him or not, he assures us they come with a great business plan, but he failed to say who’s money it would be. WAKE UP people this balding crook is going to stick it to taxpayers AGAIN, and the Canadian Crooks WILL get yet an even juicer TIFF. Not that it matters now, but how many companies get a fifty percent TIFF even if they close their doors. As many mill workers will be worried about a cold and uncertain winter, it would be only fitting and fair to let the CEO at Brookfield Bacon in on an impending eco injunction. That’s right, if you don’t clean up, Millinocket will make you pay up.
I just cant get over what advanced life form gave these shysters a TIFF that continues even after they close. If job one is lost in Millinocket the Boys at Brookfield Bacon should expect a court order to cleanup their toxic dump. Brookfield had better cleanup, or they will be forced to pay up.
Lastly, it was not only the unions, it was also the environmental nuts that put people like Michaud and Baldacci in office, but yet some true idiots keep voting Democrat.
C'mon BDN, get with the program posting comments. Or will you not post certian comments because you disagree with them? Typical gestapo like management. I don't miss leaving my home state one bit! unions like this mill seem to bee a dying entities. Relics of a time when workers were willing to join together. Now it is every man for himself. The unions had their places now the just take your "dues" and run! No longer helping their members. As a shareholder in BAM I'm thankful they're closing this unprofitable plant. Downbeat obviously has not clue - or even suspects for that matter. To put it more in perspective - before the GNP mill went down last time for the bankruptcy, one of the guys I worked with said "you know, they've been asking us for years to bend over backwards - and now they want us to bend over frontwards!". I had recall rights to go back in the mill(s) and turned it down - just to avoid more of the same. They have stripped so much from these guys - wages that are about $7 an hour less at the top of the scale than in several mills in the State, benefits cut steadily in a time when inflation would eat up even large increases. But the main thing is that the unions in there now are ONLY collective bargaining units, they have no say or strength - when the mills opened up after Bedard and friends, it was either sign this contract or the mills won't run. Even prior to this, starting in the early 1980's, management of all of the successive owners (Great Northern Nekoosa, Georgia Pacific, Bowater, and Bedard) had a well worn pattern of negotiation: cry about how bad things are, threaten, offer a longterm contract "take it or leave it", before the end of that contract - repeat the process. From the early 80's we never completed a contract - they always would "break in" early with more doom and gloom and demands for concessions. It's very convenient for (idiots) to blame the unions for all the corporate woes - but the time Georgia Pacific decided to shut down our woodlands department and lay off 200 employees - the CEO T. Marshall Hahn made enough (not counting his bonuses) to pay 170 of those workers. Every problem the 2 mills have today is because of the greed of those 4 companies making short-term gains by selling off assets or laying off workers. Brookfield is the company that now holds the crown jewels of the original Great Northern Paper company - the largest privately held hydro power system in North America. There is more to this story than what is reported in the News. I also could be quite sure, that the News was not given the entire, complete story from either side of this issue...and this is not the fault of the BDN. Even though they ask many questions, the union officials and the corporation officials may be evasive in answering some pertinent issues or making further comments just yet. It could be, that attorneys for both sides are ordering them to not disclose any more information because of legal reasons. The real problem is that the workforce at Millinocket's Brookfield mill, and their families at this highly-critical time of year when heating fuel for homes, high gasoline prices at the pumps, Thanksgiving and Christmas on the way, and other wintertime factors, will certainly cause gross hardships on the laid-off workforce. And...the union cannot do anything about it except complain about this, and that, and continue to voice their opinions. That does not solve the problems...nor does it assist the workforce much. Maybe those employees at the mill have more to tell than what we already know, but I would hope that with some reconstruction of the corporation's future planning, the mill will re-open in the near future. This mill seems to be a great economic value to Millinocket. What does Vladimir Putin, Osama Bin Laden, and Brookfield Asset Management all have in common, they all hate the US. I applaud Scott Gonya, Jimmy Busque, and David Cyr, and those “that have a backbone” to take back that which was hoodwinked from us in closed door negotiations. Those that bartered away our resources did so without the original power to do so. Those that spearheaded a fifty percent TIFF even if they close the mill need to be exposed as criminals, and be held accountable. There is much documented back story on this, and Scotts drive to take back the mill was a direct result of a recent threat by Brookfield to close East Millinocket if we even so much as complained. Too many people seem to be commenting on limited information, but what they dont understand is that Brookfield is a lot dirtier than most realize. As far as our town manager, Gene is the most qualified and underpaid asset of this town, and I defy anyone to find better, even for more money. As to what would we do with this “very plausible & achievable goal of eminent domain” It needs to be understood that Scott’s suggestion was to seize it, run the hydro and provide Millinocket with cut rate power. SO, to those who have posted earlier and seem to have a certain body part in the wrong place, this move could “legally” provide Millinocket with buckets of taxable revenue, an annual economic development fund and allow us to stop sucking on the Arab pipeline and heat our homes affordably with electric.
I applaud Scott Gonya, Jimmy Busque, and David Cyr, and those “that have a backbone” to take back that which was hoodwinked from us in closed door negotiations. Those that bartered away our resources did so without the original power to do so. Those that spearheaded a fifty percent TIFF even if they close the mill need to be exposed as criminals, and be held accountable. There is much documented back story on this, and Scotts drive to take back the mill was a direct result of a recent threat by Brookfield to close East Millinocket if we even so much as complained. Too many people seem to be commenting on limited information, but what they don’t understand is that Brookfield is a lot dirtier than most realize. As far as our town manager, Gene is the most qualified and underpaid asset of this town, and I defy anyone to find better, even for more money. As to what would we do with this “very plausible & achievable goal of eminent domain” It needs to be understood that Scott’s suggestion was to seize it, run the hydro and provide Millinocket with cut rate power. SO, to those who have posted earlier and seem to have a certain body part in the wrong place, this move could “legally” provide Millinocket with buckets of taxable revenue, an annual economic development fund and allow us to stop sucking on the Arab pipeline and heat our homes affordably with electric. Brookfield Power made it very clear to Millinocket by threatening to shut down East Millinocket if they made waves. Why would Millinocket care about East Millinocket, they hate each other! Why after being lied to by Brookfield Power year after year, would anyone trust them now? What’s worse than lying to “The People” the beating your going to get when a bunch of out of work Union guys suddenly realize that they have been made a fool of! And what Millinocket Town Councilor was so criminally inept to give a bunch of hockey rink rejects a TIFF that continues, even after they close their doors?
Gee Mark44 are all those dams in Millinocket that they want to seize? Do you really think that the towns people have the money needed to change out their current heating systems for electric? I thought Millinocket wasn't in the business of running a business? No Jennifer, but if you research this a little more,,, you will find that there is only one dam that has been mentioned, and even at less than half of a delivered rate, the economics to change over could be done a lot faster than your average armchair contributor might think. I think our energy needs should include oil as well, but balancing them out with hydro, coal, wood, solar, wind, and gas are what will sustain us in the future. And Jennifer, after fuel hit $1.98 cents a gallon, electric heat “Not at the current inflated Brookfield rate” but rather at the average US rate, now becomes cheaper than oil. Additionally, a hydro power generation facility is drastically less than “ANY” other form of electricity, because- It’s not fossil fed, and doesn’t emit CO2 It’s not going to need a million years of stewardship (Nuclear) It’s not dependant on the wind, or sun and offers a substantially steady stream of electricity. It’s a far cry cheaper and easier to convert than geo-thermal, although geo-thermal is pretty sweet. Let’s face it- if it doesn’t glow in-the-dark, blowup, stink, or pollute, “And” has no fuel feed cost~ Out dam is extremely beneficial to Millinocket….
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