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Officials say they will fight to keep Massena Alcoa smelter open even after latest deal expires

Posted 11/24/15

By ANDY GARDNER MASSENA -- After announcing Alcoa will keep at least 600 jobs in Massena through early 2019 this morning, state and federal officials said they will fight to keep the aluminum smelter …

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Officials say they will fight to keep Massena Alcoa smelter open even after latest deal expires

Posted

By ANDY GARDNER

MASSENA -- After announcing Alcoa will keep at least 600 jobs in Massena through early 2019 this morning, state and federal officials said they will fight to keep the aluminum smelter operating should the company decide at that time to leave the North Country.

That announcement was an early Christmas present for the 487 Alcoa workers who were told earlier this month they would lose their jobs and Alcoa was not going to follow through with plans to modernize the Massena east smelter.

“We don’t think it’s going to be three-and-a-half years and they turn away,” Sen. Charles Schumer said Tuesday during a press conference in Massena. “If the price of aluminum goes down, we’re going to be back here. We’re not going to let this plant go.”

The deal announced Tuesday grants Alcoa a $68.8 million corporate welfare package in exchange for a pledge to keep 600 jobs in Massena through March 20, 2019. The aluminum giant will receive $30 million from the New York Power Authority in power discounts and $38.8 million from the state.

The NYPA discount is in addition to millions of dollars in discounts and incentives Alcoa has already received from the agency.

“The $30 million is just an estimate because the number could go down if aluminum prices increase,” NYPA spokesman Steve Gossett said. “The $30 million is what Alcoa will now be saving on top of the incentives it has already received from the state. And those amounts are not cash payments, rather the savings that results compared to the wholesale price of electricity.”

Alcoa’s bailout equates to the state spending roughly $64,600 per employee without the NYPA power subsidy. Once NYPA’s deal is factored in, it goes up to about $113,300 per worker.

Even with the payments to the company, there will still be a few jobs at stake. Alcoa spokesperson Laurie Marr said 85 positions are on the chopping block.

“We will offer voluntary separation packages, transfers to other locations, job referral and career counseling services to alleviate the impact of those affected by the layoffs,” Marr said.

Sen. Charles Schumer said he learned of the initial decision to close the smelter through a newspaper and felt “betrayed.”

“This was not a negotiating table. This was a unilateral declaration of war,” he said.

Gov. Andrew Cuomo said he is hopeful that the bailout will help the aluminum giant get back on its feet while the aluminum market rebounds.

“We get it,” Cuomo said at Tuesday’s press conference. “We understand the economic cycle and the price of aluminum.”

Alcoa Primary Metals President John Martin said the initial call to close the west plant smelter was “a tough decision.”

“It was based on forces in the global market of aluminum,” Martin said.

“Today’s agreement helps better position the smelter in light of prevailing market conditions, providing this facility a bridge to a stronger commodity market and maintaining jobs in the North Country,” Alcoa CEO Klaus Kleinfeld said in a prepared statement.

Massena’s mayor says the area needs to get away from dependence on industry.

“We must not lose sight of the fact that we cannot continue to rely primarily on industrial jobs. We must continue to count on them to some degree, and pursue those jobs for potential growth opportunities,” Mayor Tim Currier said. “However, we now know more than ever, that we must continue to focus on diversified job-creation and growth strategy.”

Lawmakers at all levels of government are praising the bailout deal.

“If this plant closes, it would be devastating to the local community,” Cuomo said at a Tuesday press conference announcing the deal.

“Losing Alcoa would be a devastating blow to the region's economy, and this deal will give us the ability to do long-term planning so we can avoid catastrophic job loss in the future,” said Assemblywoman Addie Russell, D-Theresa. “I look forward to continuing to work with representatives from Massena, the North Country, and at the state and federal level to ensure we are able to grow our local economy and support the world-class workers who live here."

“This development is more than just good news for Alcoa’s employees, it’s good news for the entire North Country,” said Sen. Patty Ritchie, R-Heuvelton. “For decades, Alcoa has been a mainstay of St. Lawrence County, and this agreement will help us as we continue our work to grow the local economy and create good paying jobs for people in our region.”

“While this is a welcome announcement, I remain committed to working in Congress to help grow the North Country economy so that we can create good paying jobs,” Rep. Elise Stefanik said.

Cuomo’s office did not respond to an inquiry asking why lawmakers are deciding to give millions to Alcoa rather than invest it in local businesses, none of which the region would be totally dependent upon.

Alcoa will incur a $40 million penalty if employment goes below 600 jobs before March 20, 2019, Cuomo said.

Schumer said the deal does not include a provision where Alcoa will modernize its shuttered east plant smelter, which was part of their original deal struck two years ago.

“This is only for the west plant,” he said.