STEUBENVILLE - Hundreds of Ohio Valley residents who at one time worked for RG Steel and its predecessor companies don't have much to celebrate this Labor Day.
RG Steel, which filed Chapter 11 bankruptcy protection on May 31, chose to liquidate, rather than reorganize, leaving its workers - many of them laid off two years or more - without jobs and benefits.
"I think labor is under attack, I really do," said Santo Santoro, staff representative for the United Steelworkers Union. "We're battling for survival now. Instead of just battling for the normal operation thing, we're hoping and praying and fighting to get something going at (our idled mills.) We're doing everything humanly possible to try and get these plants running again and providing employment."
With bankruptcy court approval, RG Steel auctioned its holdings in Ohio, West Virginia and Maryland off: The Mingo Junction operation sold for $20 million to Frontier Industrial, a New York-based company that specializes in salvage and brownfield development, though company officials said they're willing to consider proposals to operate certain parts of the property, including the $250 million electric arc furnace as well as the continuous caster and 80-inch hot strip mill.
RG Steel's Yorkville plant sold for roughly $5 million to Sewickley, Pa.-based Esmark Inc. and South Korea's TCC Steel, though closing on that deal has been delayed by RG Steel's failure during the past two years to properly correct and document problems with pickling-liquor spills at the plant. Esmark also acquired RG Steel's 50 percent ownership stake in Ohio Coatings.
Wheeling businessman W. Quay Mull, meanwhile, picked up the Martins Ferry plant, which he's said he intends to operate, for $2 million, while RG's Warren operation sold for $17 million to a Pennsylvania-based salvage company that also has indicated an interest in operating it. RG Steel's Sparrows Point, Md., plant was sold at auction for $72 million to Hilco Industrial.
The 100-acre Steubenville plant sold in June to River Rail Development, an arm of the Wheeling-based salvage and recycling company, Herman Strauss Inc. No buyer has emerged for RG Steel's 50 percent ownership stake in Mountain State Carbon, the Follansbee coke-making operation that's a joint venture with Russia's Severstal.
"Labor's in a tough way right now," admits Phil Diserio, president of International Brotherhood of Electrical Workers Local 246 in Steubenville. "People talk about the war on coal, but I really think the war has been on America's manufacturing sector - jobs are moving out of the country."
Diserio said there's opportunity on the horizon with the Marcellus and Utica shale development, but it's still years away "and there's a lot of people out of work right now."
"I think in this immediate area, Marcellus and Utica shale will eventually produce a lot of jobs," he added. "I just hope local people have first opportunity at those jobs, and that they bring some benefits and a way to retire with respect."
Diserio said he feels for RG Steel employees "struggling to figure out which way to go to get health insurance, guys my age, 50 years old, wondering what they're going to do now."
"You'd think maybe we'd be used to it," he adds, pointing to the downsizing that's taken place during the past two or three decades in local mills. "Those fellows with the USW have been through this time and time again, they don't deserve it."
Santoro, meanwhile, said the speed with which RG Steel moved from what started as a Chapter 11 reorganization but devolved into full-fledged liquidation was "the fastest bankruptcy I've ever experienced in my life, and we'd experienced two other ones."
"Who would ever have imagined we'd be going through this for so long, then end up with the fastest bankruptcy ever seen?" he adds. "RG went into Chapter 11 for restructuring, then all of a sudden the mills were up for sale and boom, boom, boom, it was done. I never saw anything like it."
He said he's thankful the new owners have shown interest in operating the Yorkville and Ohio Coating plants, "and we're trying to reach agreement for the coke plant, trying to keep things going for all the people" while the search continues for investors at the other properties.
These days, he said "everything we do is just a constant battle."
"It's a tough Labor Day when our people are out of work for this long," he said. "We've got good people who want to go back to work and can't, put it that way.
"Right now, it's tough for people to hold on, especially with what these guys are facing. It isn't that we're not trying, we surely are. We're trying to find investors to operate the plants, we're constantly looking. That's our No. 1 priority, and I'm hoping people hang in there."
(Harris can be contacted at lharris@heraldstaronline.com)
