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Hundreds To Lose Jobs After Luke Paper Mill Closing In Western Maryland

LUKE, Md. (WJZ) -- A paper mill in Western Maryland is shutting its doors leaving hundreds without jobs.

Verso announced Tuesday it would close its paper mill in the town of Luke in Allegany County after a decline in the demand for "grades of coated freesheet paper produced at the mill, along with rising input costs, a significant influx of imports, and rising compliance costs and infrastructure challenges associated with recent environmental regulation changes."

The mill will close on June 30. It will reduce the company's coated freesheet production capacity by 450,000 tons and its total annual production of the paper by 2.7 million tons.

"It is unfortunate that we had to make the decision to close the Luke Mill, but the continuing decline in demand for the grades of paper manufactured there left us no choice but to close this facility that has struggled with profitability for a number of years," said Verso Interim Chief Executive Officer Leslie T. Lederer.

"The company explored the possibility of producing alternate grades of paper products but the conclusion remained the same – we could not achieve profitability at the mill in today's market environment," Lederer continued. "Consistently matching the supply of our graphic paper products with customer demand for these products, reducing our costs and rapidly diversifying our product portfolio into growing markets remain essential drivers for Verso's long-term success, and we continue to vigorously pursue these objectives."

About 675 employees will be affected by the closing of Luke Mill.

Gov. Hogan released a statement later Tuesday afternoon:

"My heart goes out to each and every one of these employees and their families. They are decent, hard-working people who deserve better. I have directed our Secretary of Labor and Secretary of Commerce to do everything possible to help the workers and the community. Our administration has already been in touch with local officials, as well. We will dedicate all of our efforts to mitigating the impact of this decision, while working to recruit new jobs and businesses to the area."

Employees were notified in advance. The employees will receive severance.

"The decision to close this mill that has been in operation for more than 130 years was an extremely difficult one, and is in no way a reflection on the dedicated men and women who work there," Lederer said.  "We know that this will be an extraordinarily emotional and challenging time for our Luke Mill team, and Verso is committed to treating them with fairness, respect and dignity during this difficult time. We will also do our utmost to ensure employee safety during the transition. I want to thank each and every member of the Luke team for their hard work and dedicated service to the mill, to Verso and to our customers."

Delegate Mike McKay of Allegany and Washington Counties released a statement Wednesday:

"I am disappointed and concerned about the long-term impacts of the closing of the Luke Mill on our community. My heart aches for the 675 individuals and their families who now find themselves searching for a new job. Sad situations like these illustrate why it is so important that we invest in Western Maryland's economy, infrastructure and workforce and not construct national and state barriers that deter businesses from doing business in our community. I offer my support the employees of the Luke Mill and will help them through this transition in any way possible."

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