The Selma Times-Journal

On Feb. 24, Globe employees at the Selma plant received a 90-day notice of the plant’s closing.

The closure of the plant will hit the local economy and pocketbooks of families as it will mean the loss of 72 plus jobs in Selma, according to industry officials. Faced with the elimination of their livelihood, several employees and others impacted by the news channeled their panic into proactive action.

“We’ve received calls from vendors and employees,” said Wayne Vardaman, president of the Selma-Dallas County Economic Development Authority, adding, “local politicians have also gotten calls. I don’t know that it’s a done deal, but the company has given its employees a notice.”

Hayes Kern, human resources manager for Globe Metallurgical corporate, headquartered in Beverly, Ohio, indicated that a surge in energy and raw material costs combined with decreasing costs of imports from foreign competitors forced management to close its Selma plant.

“As of Jan. 1, we took a 20 percent increase in power cost. We’re working with Alabama Power to see if there is a way things could otherwise be structured. We’re also in discussions with all of our vendors concerning what can be done about raw material prices. We’re hopeful that a resolution can be reached. But, as of right now, we’re looking at a closing date of mid-June,” he said.

The rising costs of fuel also hit Alabama Power hard and they’ve had to make rate adjustments, explained Alabama Power spokesperson Jan Ellis. As a utility, Alabama Power is regulated by the Public Service Commission and cannot legally make a profit on fuel costs and does not mark it up. The PSC does, however, allow it to recover those costs by passing them through to the customer.

“Last December, the PSC approved an increase in our fuel cost recovery factor from 1.788 cents per kilowatt hour to 2.4 cents per kilowatt hour,” she said.

Industrial customers and others who buy in bulk, like Globe, get a reduced rate. They saw their charges increase to 2.24 cents per kilowatt-hour, Ellis said.

“Over the years, we’ve provided various rate options to assist them with controlling their costs and to show them how to use energy efficiently,” she said.

There is only so much, however, the utility can do, and still be fair to all the customers its serves, Ellis said.

“We cannot offer contracts to large industrial customers that require subsidies from other rate payers,” asserted Ellis.

Power officials and others are in the early stages of negotiations and are cautiously optimistic. Mayor James Perkins Jr. said his office has received several phone calls from concerned employees and is working with them.

“About four years ago, Globe went through a similar crises that the city helped them with resolving at that time. We are involved in working with them now, but as to what extent that involvement is, I am just not at liberty to say,” said Perkins.

“Globe is a very special customer to us and we hope that everything will work out and they can stay in the Selma area,” said Ellis.

Established in Selma in 1959, has faced and overcome its fair share of crises over the years. In 2004, The U.S. Labor Department’s Occupational Safety and Health Administration (OSHA) proposed $40,500 in penalties following the investigation of a fatal accident that killed employee Tony Bradley in May of that same year. Since 1990, three similar fatalities have occurred at Globe Metallurgical.

The safety issues and subsequent OSHA fines and other costs had nothing to do with the decision to close, said Kern. He indicated that since the time the incidents occurred, the company set the necessary safety standards in place and “continues to strive for a safe working environment.”

For now, Kern indicated management is doing all it can to work out a deal that is amenable to everyone.

“Coming into it, I am extremely hopeful we will get local and state support. Globe has had a long time presence in the Selma community and I don’t want to see that go away,” he said.

If Globe management and local agencies can not find a way for the company to become competitive again, Kern said he has engaged in preliminary discussions with city and county agencies about job placement for affected employees. The company may also consider transfers to one of its three other plants. But for now they are just trying to negotiate with everyone they can and keep employees focused on the work while they do what they can to salvage the company, suggested Kern.