Paper Mill To Close After 131 Years, Over 675 To Lose Jobs

On April 30, 2019, Verso Corporation announced that the Luke, Md. paper mill would be shut down effective June 30. Verso claims that 675 employees will lose their jobs as a result of the closure. Local estimates suggest that for every one position eliminated by Verso, three more support jobs will be lost, suggesting a total loss of around 2,700 jobs to the Western Maryland region. The Luke mill was the largest private employer in Allegany County, Md.

Verso claims declining demand in coated paper products made the continued operation of the Luke mill unprofitable. Originally founded as the West Virginia Pulp and Paper Mill, the location has traded many hands over the years, being operated by Westvaco, MeadWestvaco, NewPage, and Verso Corp. Uniquely situated on the Potomac River, the mill has its own power center, woodyard, production facilities, and distribution center. Verso representatives stated that the company would consider any and all offers for a potential buyout, with the exception of companies that operate in the coated paper industry alongside Verso.

Employees and state officials were notified of the mill’s closure in accordance with the WARN Act, and employees will be paid through June 30, 2019. Pensions will not be affected by the closure, and the worker’s union is currently in negotiations with Verso management to determine factors such as severance pay and a potential temporary continuation of health care.

The closing of the Luke mill will have devastating effects for the economy surrounding Frostburg State University. The mill operated in an involved supply chain of local loggers, truckers, woodyards, and rail facilities.

Public officials from both West Virginia and Maryland expressed alarm at the announcement, with many pledging to unlock state resources to assist affected workers and their families. Maryland Governor Larry Hogan spoke with Verso Interim CEO Leslie Lederer shortly after the announcement in an attempt to get the company to reverse the decision. The governor was unsuccessful in his attempts. Maryland State Senator George C. Edwards has stated that the governor “wants to pull out all the stops” in an attempt to market the Luke facility to a potential employer. On May 2, Edwards reportedly had two inquiries from prospective investors. These inquiries were passed on to Governor Hogan.

Employees of the Luke mill are encouraged to sign up for updates on state resources and assistance at www.workforceallegany.com.