International Falls Journal - Community Reacts, Responds to Boise Inc. Loss of Jobs

News Article

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Community response is widespread and urgent to address the needs of the community and workers displaced by the reconfiguration and downsizing of the Boise Inc. paper mill in International Falls.

Since Thursday's announcement by the company that it will eliminate about one-third, or 265 positions, at the paper mill, federal, state and local officials have called for a coordination of effort to assist the workers who will lose their jobs as well as to diversify the local economy to provide new jobs and create a base less reliant on the paper mill.

Falls Mayor Bob Anderson Monday told the International Falls City Council that he had met with staff of U.S. Sen. Al Franken, who sent staff to the community last week, as well as talked to Congressman Rick Nolan, and Minnesota Rep. David Dill. He reported that the state and federal officials pledged support for the community and the workers that will lose their jobs.

In addition, Anderson reported that the Minnesota Department of Economic Development Commissioner Katie Clark-Sieben called him to voice her department's support, and she said Gov. Mark Dayton and she are prepared to work with the city and Koochiching County moving forward.
Madeline Koch, DEED director of communications, said a rapid response team is now in the community working with employees that may lose their jobs.

"Our priority is the workers," she told The Journal Monday. "We will be helping them on a range of issues, including finding new roles to benefits such as training and job search allowances to make sure the displaced workers are on track to finding new employment."

For more information on employment, see the DEED website at http://www.positivelyminnesota.com/.

Anderson also reported Monday that Andy Hubley, executive director of the Arrowhead Regional Development Commission, is considering how the Federal Economic Development Administration can assist in the community's long-term recovery. Anderson said he asked Hubley to contact the University of Minnesota Extension Service about an emergency economic impact analysis that would consider the impact of the job loss. Hubley, he said, is prepared to facilitate a conversation between community and business leaders and organizations to help work toward recovery.

Anderson said local and corporate staff with Boise will request a meeting with city, county and school district officials to discuss the impacts of the announcement.

The council Monday considered whether to schedule a committee meeting or full council meeting with county commissioners to consider how to move forward.

Federal officials

Meanwhile, U.S. Sen. Amy Klobuchar told The Journal her office is working with state and local officials to help the workers in any way possible, including with benefits.

"And I will continue to fight to level the playing field for Minnesota's paper and logging companies so they can compete against foreign companies," she said.

Just after the Boise announcement, U.S. Sen. Al Franken released a statement calling Thursday a tough day for the Boise paper mill, its employees, and for International Falls and surrounding communities.

"Boise is the largest employer in Koochiching County, and has provided good, quality jobs for years," he stated. "I have been in touch with state and local officials, employee representatives and the company to offer my assistance. I will have staff on the ground in International Falls today and my office will continue to work with local and state officials to address the challenges that these layoffs present."

Congressman Rick Nolan said the pending job cuts at Boise will touch everyone in the International Falls community.

"This is a matter of great concern to me, and I am prepared to go anywhere, and meet with anyone, to explore ways to keep these good jobs right here," he said in a statement to The Journal. He said since the announcement he has been in conversation with union, company and local officials as well as with local legislators.

"And the consensus seems to be that we need to move in three directions at once.

"First, we need to determine if there is any chance, or any way, those jobs can be retained. Second, we need to make certain that every worker and every family affected receives every possible avenue of assistance available from local, state and federal sources. In particular, our congressional office is exploring whether or not Boise workers would be eligible for trade adjustment assistance the federal government makes available when workers are uprooted because of unfair foreign competition.

"And third, as The Journal noted in a recent editorial, we need to seriously explore ways to diversify our economy here in the border regions in order to attract new jobs and reduce our dependence on any one company or industry.

Nolan concluded that it's important for people to know that he and his staff are available to them "and together we're going to get through this."

State officials

Minnesota Senate Majority Leader Tom Bakk said three things come to mind with the announcement: A hope that Boise officials are right that the reconfiguration will make the paper mill more secure in the long term; how important border relations are to the flow of tourism and trade and anything, including a fee to enter the U.S., that would make border traffic more difficult is problematic; and how important diversification is to the economy.

The need for diversification, he said, is not new to Iron Range communities that experienced downturns when mines downsized and shut down.

Bakk said because of the low demand for paper, more effort is needed to explore using wood fiber to produce energy and fuel.

Meanwhile, he said the loss of jobs will have a ripple effect that will touch nearly every aspect of the community.

"This reinforces the importance of Rainy River Community College, where people can get the skills and training for some ancillary business," he said.

Rep. David Dill said even Boise, which has been dedicated to the community to the best of its ability for more more than 100 years, is not immune to the global market conditions and the rising price of energy.

And, he credited the mill's workers with making a quality product with a high safety record.

"I applaud the work there and support the company and families that make International Falls and beyond in Koochiching County viable and thriving," he said.

Dill said when a mill official called him about the announcement, he recalled how in 1984 when the company closed Insulite the community bounced back.

Since then, he said the community has expanded with more development of Voyageurs National Park and its headquarters and expansion of border security which has brought staff to the community.

"But not in any way does that mitigate the loss of 265 jobs in the community and the ripple effect that will have," he said, estimating that 2,000 members of the community will be impacted.

He said the costs of energy, pulp, transportation, chemicals and regulation played a role in the company's decision, along with low paper demand and high global competitiveness.

"But I. Falls and Kooch County are survivors and the company has a strong commitment to the community," he said. "I hope the company is right that making these changes it will be even more competitive in the markets it is still in."

The announcement should serve as a rallying cry, he said, for future opportunities.

He called on economic leaders, business owners and entrepreneurs to come forward with ideas to create new jobs to diversify the economy.

"I urge all citizens that have ability to come to call to put on their thinking caps, if they don't have have them on already, and fire up and figure out what we can do, what we can make, what we can sell, where we sell it and how we make it," said Dill.

He said displaced mill workers have tremendous skill sets from their employment. He also noted that the success of local entrepreneurs recognized by the Joel Labovitz Entrepreneurial Success Awards this year and in years past is the "proof in the pudding that we have got what we need to make it."

Wayne Brandt, executive director of the Timber Producers Association, said the heart of his organization is with the people affected, the community and region.

He said Boise's changes are among a long line of industry changes in the state driven by a poor climate for the forest products industry.

He pointed to a University of Minnesota Duluth study that shows that 100 jobs in the community and $280 million in economic activity will be a result of the mill changes.

"We need better quality wood, more competitive energy prices," he said. The state has headed in the wrong direction and must address difficult issues or more loss of industry capacity will come.

"There is not one answer, but energy has been going in the wrong direction for a decade," he said. He said electrical costs were an advantage for industry in Minnesota 10 years ago. Since then, he said electricity costs have risen by 55 percent and are among the highest in the nation.

He said industry subsidizes residential electricity rates in Minnesota Power's service area.

"Subsidizing the needy is one thing, but everybody?" he said. "Ask the person on the street corner if they would pay $3 or $5 more on their electrical bills or lose 300 jobs in this mill, or 600 from another. I know what side of the equation I and most people would be on."

"People don't seem to want to look at the tough issues, he said, "then they need to face reality that industry will continue to shrink and people ought to be made aware of that."

Local officials
Independent School District 361 Superintendent Nordy Nelson said he expects to see about a 5 percent reduction in the district's enrollment for the upcoming 2013-14 school year.

"Out of the 1,170 students we have in kindergarten through 12th grade, we expect to lose about 55-60 of them," he said.

Nelson said the loss of students should not impact action by the Falls School Board last week to increase class sections of several elementary grade levels.

"We will make some slight adjustments as far as planning … but overall, we look to continue with our original plan," he said.

Nelson said a meeting was held after school Thursday to inform faculty and staff that if questions concerning Boise's decision make way to the classroom that any responses "are to remain positive."

"(Staff) was told to do their best to show support and that hopefully things will look much brighter in the near future," he said. "On behalf of the district, this is a real surprise ... we just really want to convey our support for the individuals involved."

County Board Chairman Kevin Adee said he was saddened by Thursday's announcement and said he looked forward to meeting with other local officials to discuss how to move forward.

"I don't know what we can do," he said, but local officials, he said, would focus on how to diversify the economy and create new jobs.

Adee said he discussed how the loss of the jobs and the reconfiguration would impact Boise Woodlands and said a representative reported the changes wouldn't affect area loggers as much as initially expected.

"I'd like to hope the rest of the jobs in the community won't be affected that much," he said. "The total dollars that will be affected will be a lot of money that won't be available in the community any more."

Paul Nevanen, Koochiching Economic Development Authority director, said that after he experienced shock and sympathy for families who will be directly impacted by the announcement, he remembered that the community is resilient.

"We must redouble our efforts at job creation," he said. "We need to look at what has been done in the past, be unified and get everybody involved to work cooperatively."

The community has assets, including good schools, an airport, transportation corridor and a great workforce, he said. "It's getting back to basics and we need to focus on that. Diversification has long been a goal for all of us, we have a situation where we can't replace these jobs, but more diversification gives a slightly different work place, but more options."

Shawn Mason, International Falls director of economic and community development, said now more than ever citizens need hope for their future and the future of the community.

"They need to witness leadership with their sleeves rolled up, working collaboratively and effectively," she said. "State and federal officials want to help, as do regional development agencies. We will need significant assistance from them in the form of funding, business expansion and creation incentives -- and even more important will be having them on our team to implement an aggressive job creation campaign."

Mason said the wood products industry and Boise needs community support to ensure the remaining business can be successful and said the local economy must be diversified.

For instance, KEDA has been working tirelessly to launch the foreign trade zone," she said. "All officials need to support KEDA in this progressive vision, and help them get the zone shovel ready now. Our area -- specifically Ranier -- is the busiest rail port of entry in North America. Goods travel through this area destined to warehouses in Chicago -- for storage, assembly and repackaging to meet US codes. KEDA's FTZ, and the city (Economic Development Authority's) multimodal district are on the rail route so an obvious job creation opportunity is aggressively marketing shovel ready sites to companies for assembly, packaging and warehousing. There are several other examples where, if we all worked together and put our shoulders into it, we could not only recover from this storm, but we could also begin to flourish. It's all hands on deck -- let's get it done."

Faye Whitbeck, president of the International Falls Area Chamber of Commerce, said Monday that the announcement is "a blow we're still reeling from -- devastation is a word sometimes overused but certainly in this instance, it's appropriate."

She reiterated the chamber's continued commitment to being a conduit for communication, information and service. And said the chamber board and staff extend concern and support to the employees and families most directly affected.

"Inevitably, our anxiety also surrounds the exponential economic repercussions -- many folks who own businesses also work at Boise, and certainly the loss of the spending power of that many employees and their families will impact economics in the area," she said. "There are few who will escape the effects of this change. The announcement puts the emphasis, more than ever, on efforts toward development, and on the integrity of our community in helping each other, working together and moving forward with hope."

Calls to a local union representing mill workers were not returned in time for this report.

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