Brewery workers at the former Rolling Rock plant in Latrobe will be laid off for at least two months because City Brewing Co. of LaCrosse, Wisc., will no longer have a beer for them to brew, state and union officials said Wednesday.
The 70 bottlers and brewers were told recently they would be laid off in early November, said Gerard "Jake" Millward, business agent for Local 22B, which represents brewers at the Latrobe plant.
"They are shutting down the rest of the year and likely would restart in early 2009," said Kevin Ortiz, a spokesman for the state Department of Community and Economic Development. The state has been told it is a "temporary shutdown" while City Brewing secures new work for the plant, Ortiz said.
City Brewing is stopping production because it will not be brewing the 14 brands of Samuel Adams craft beer under a contract with the Boston Beer Co., Millward said. City Brewing serves as a contract brewer but does not have a beer of its own.
Publicly owned Boston Beer did not release figures on how much Samuel Adams beer City Brewing produced, but Boston Beer began brewing Samuel Adams in July at a former Pabst brewery near Allentown. Boston Beer spokeswoman Erika Schermerhorn declined to comment yesterday except to say that Boston Beer has a long-term contract with City Brewing.
City Brewing is negotiating with another company, Millward said, but the union was told no details about those talks.
Workers contacted yesterday said they had heard rumors of layoffs, but the company has failed to keep them informed.
Randy Smith, chief executive of City Brewing, and Gregory Inda, chief financial officer, could not be reached for comment. Kevin Morgan, manager of the Latrobe plant, also could not be reached.
The layoffs will mark the second time in the past two years that brewery workers at Latrobe have lost their jobs. The brewery was shut down in July 2006 when former owner InBev USA sold the famed Rolling Rock brand to Anheuser-Busch Co. of St. Louis. InBev has since agreed to acquire Anheuser-Busch.
The brewery did not reopen under City Brewing until June 2007. City Brewing bought the plant in September 2006 with the hopes of brewing beer, malted beverages, flavored teas and sports drinks.
Any hopes that Rolling Rock beer could return to production in Latrobe, now that the brand is about to be owned again by InBev, is just a pipe dream, Millward said.
There still are opportunities for contract brewing because there are fewer breweries that offer that service, said Peter Reid, editor of Modern Brewery Age, a trade publication. But the loss of the Samuel Adams work is a tough blow because "Boston Brewing is one of the biggest" customers for contract brewers, Reid said.
"I don't know anyone who steps in" with new work, Reid said. "In some sense, it (the loss of Rolling Rock) reduced that plant's reason for being," he added.
Workers will be informed about various state services available to them when the state's Rapid Response Coordination Services team meets with the employees Monday at the plant, Millward said. The PA CareerLink Center in Youngwood, which provides job search services, is part of a team that will be conducting two sessions Monday for the brewery workers, said Anthony Gebicki, site administrator for CareerLink in Youngwood.
The layoffs next month stand in stark contrast to the optimism Gov. Ed Rendell and local economic development officials exuded in January 2007, when the governor announced that City Brewing would be able to tap into a $4.5 million financial aid package to help restart the plant. That financial aid included up to $2.9 million in grants for infrastructure improvements, a $500,000 opportunity grant and a $400,000 loan from the Pennsylvania Industrial Development Authority, along with $250,000 in customized job training grants.
At that time, Rendell said he hoped the plant would have about 250 employees working by June 2007, but the brewery never created that many jobs.
City Brewing has used $200,000 of the $500,000 opportunity grant, Ortiz said.
