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Closure of coal plant in Milam County hits local job market
July 13, 2018
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ROCKDALE: David Montelongo isn’t used to being alone. He’s spent his 60 years in the Central Texas town of Rockdale, surrounded by family and working the last 39 years in the local coal mine. He has a wife, three grown children, eight grandchildren and many other relatives in this town of 5,600.

Now, his days are lived on the road and at a West Texas oil field, where he is a supervisor.

“All I do is go home, sit in an apartment and wait for the morning to come,” Montelongo said.

His time in an overpriced one-bedroom Odessa apartment is mostly quiet as he counts the weeks until he can visit his family in Rockdale and the years until retirement.

The closing of the coal-fired Sandow power plant and the mine that fed it - widely seen by outsiders as another gasp of a dying industry —forced Montelongo to find work six hours away from his family.

Sandow owner Luminant, the state’s largest electricity generator, said last October it was closing three coal-fired power plants in Texas because they weren’t profitable, thanks to cheap natural gas and plentiful wind energy.

Depending on whom you ask, the coal plant closure was seen as a victory for clean air, a rebuke of President Donald Trump’s pro-coal agenda or a blow to a durable blue-collar economy.

Milam County residents reacted with a mixture of dread and relief. It could be a burden or an opportunity. Left behind is a one-of-a-kind industrial site that could anchor the county’s future economy. But, there are no guarantees.

Sandow’s closing in January ended the area’s 65-year industrial golden age and sent local leaders in the county of 25,000 scrambling as tax revenue started to plummet.

In the Rockdale ISD, Luminant property accounted for more than 40 per cent of the district’s tax base. In 2017, the company paid at least $4.1 million in property taxes to the school district, according to county records. This year, that’s expected to shrink to $614,000.

Luminant properties that were on the Milam County tax rolls for nearly $632 million in 2011 are now listed at about $47 million. In just the past year, that property value has declined by 85 per cent.

The most immediate impact, though, was the loss of 325 jobs, or nearly a tenth of all private-sector jobs in the county, according to federal data. Many of those were the area’s best-paying ones.

The closing of the Sandow plant wasn’t the only blow to Rockdale and surrounding areas. It was the final act in a decade-long decline.

“We knew that it was coming,” said Rockdale ISD Superintendent Denise Monzingo. “We just didn’t think that it was coming this fast.”

First, there was the aluminium plant

The power plant existed only because of an aluminium smelter several miles southwest of Rockdale and the millions of tonnes of lignite coal just under the surface.

Coal plant

The Alcoa plant started production in 1952, and the power plant and coal mine followed shortly after.

Processing bauxite ore into aluminium requires high temperatures (more than 1,700 degrees) and massive amounts of electricity. So the adjacent power plant and plentiful, nearby coal were crucial to fueling those production lines.

Eventually, Alcoa Rockdale grew into the company’s largest aluminium smelter and — along with the mine and power plant —employed as many as 2,000 workers by around 2004, according to Alcoa officials.

The Pittsburgh-based company dominated the Rockdale area for more than a half-century. Generations of fathers and sons, uncles and nephews worked together at the aluminium smelter, the power plant or the coal mine.

Scott Randall, 64, who describes himself as an “Alcoan,” said the plant and mine were godsends. Local residents without college degrees could get reliable, lucrative jobs without leaving their hometown.

On-the-job technical training and a strong union allowed them to rise through the ranks.

Randall attended college in Florida and East Texas but didn’t have a clear direction. Then, his father told him Alcoa was opening a new production line and to get back to Rockdale as fast as possible.

“We didn’t know how lucky we were,” said Randall.

With hard work and enough overtime, he said, workers could make $100,000 a year, buy houses and raise families.

As Randall walked down the driveway at his parent’s home, he looked up and down the winding, tree-lined street and saw at least eight houses bought directly or indirectly with Alcoa salaries.

“That’s an Alcoan. That’s Alcoan,” he said, pointing from house to house. “They did a lot for us.”

Local leaders just wish their predecessors had acted sooner to reduce their dependence on one or two big employers.

“We rested on our laurels,” said Dave Barkemeyer, Milam County judge. “It was easy to let Alcoa support the county instead of hustling to get more business.”

Decline of coal

The Sandow plant made money for most its existence by supplying electricity to the aluminium smelter.

But in the mid-2000s, the relationship between Alcoa and Luminant started souring over a long term contract to supply electricity. That led to litigation, and, eventually, Alcoa blamed its plant’s closing on an “uncompetitive power supply to that smelter and overall market conditions.”

In summer of 2008, half the aluminium smelting capacity was shut down, according to the company. The rest was cut by the end of the year, but Alcoa continued operations that made aluminium powder until 2014.

As Alcoa’s operations wound down, workers had to figure out their next moves, Some retired. Some switched to the Luminant plant. Some moved to Alcoa’s Point Comfort plant up the coast from Corpus Christi, although that facility shut down in 2016.

Kevin Barchenger, 51, started at Alcoa as a production helper, a job known at the plant as a “piddler,” sweeping up and other minor tasks. Barchenger lost his first good job when the Alcoa aluminium plant closed. Then, he was able to land a good job with Luminant.

“At least now, I’ll retire,” Barchenger remembered thinking at the time. “Surely a power plant is not going to shut down. They have a 30-year supply of lignite.”

After a three-year apprenticeship, Barchenger was repairing and rebuilding complex equipment at the coal mine. In 2017, Sandow’s long-term contract to supply power — which continued after Alcoa’s closing _ was finally terminated, leaving the plant to the whims of Texas’ competitive electricity market, where price rules.

Tribune News-Service

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