WARREN Study eyes ripple effect of shutdown at CSC Ltd.

Warren's mayor called the community impact report 'overly optimistic.'
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
WARREN -- Bad enough that more than 1,300 workers will be jobless if CSC Ltd. closes, but a consultant's study predicts the ripple effect of a shutdown would cause more than 2,000 others to lose their jobs.
From the corner mechanic to the fast-food restaurant to the trucking company's delivering equipment and supplies to the mill, a CSC closing will force other businesses to cut back, lay off workers or shut down, the report says.
The Chicago-based Center for Labor & amp; Community Research released its social-cost analysis on the impact of a CSC shutdown Friday, part of a study to determine the prospects for a successful turnaround of the troubled steel bar mill if it can be sold.
CSC is operating under Chapter 11 bankruptcy protection, and its lenders have set an April 13 deadline for closing the plant permanently. The company hopes to find a buyer before that date who will keep the massive plant intact and preserve at least some of the jobs there.
Finishing: Workers finished processing the last of the company's inventory Friday, and a CSC manager said only a small crew will be scheduled next week to continue mothballing the equipment for long-term storage.
The report says CSC workers who earned about $46,000 a year as steel workers before they were furloughed will see their incomes drop about 37 percent the first year, if they succeed in finding new jobs. Two years later, the report says, those workers will be earning about 74 percent of what they earned at the mill.
Warren Mayor Hank Angelo called the analysis "overly optimistic" in light of the Mahoning Valley's economy. He predicted even more jobs would be lost to the ripple effect, and he doubts furloughed workers' incomes would be as high as the study forecasts.
"I think this will be a lot more devastating than most people realize," he warned.
Looking at tax losses: Local, state and federal governments will lose a total of $32 million in tax revenue, while spending an additional $10 million in unemployment compensation, the consultants said. Angelo said Warren would be among the hardest hit because 35 percent of CSC employees live in the city.
John Kubilis, president of Steelworkers Local 2243, said New York City consultant Michael Locker has been impressed with the quality of CSC's steelmaking equipment. Locker, whose company specializes in buyouts, corporate feasibility studies and business plan development, was hired by an employee steering committee to study the plant, its customer base, its finances and its prospects for successful operation under a new owner.
The Reserve Group, the company's Akron-based owner, invested $100 million in an equipment modernization project over the past two years. "Mr. Locker is very, very confident that the equipment is more state-of-the-art than any of our competition," Kubilis said.
Locker expects to finish his report by late next week.
Meanwhile, Kubilis said the union is in talks with two investment groups which could be prospective partners for an employee buyout of the plant, and the company has at least two other prospective buyers, one in Ohio and one in Pennsylvania. He warned, however, that the company must find a buyer by the April 13 deadline or face having the mill sold at auction, piece by piece.