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Chesapeake Paperboard says it will remain open


The Chesapeake Paperboard Co., which warned two months ago that it might have to shut down this summer, told workers yesterday that it would remain open indefinitely as it tries to regain its financial health.

But the South Baltimore recycling company is not out of trouble yet, a company official said.

"I think we are off the intensive list, but we're still guarded," said Murrell E. Smith Jr., chief operating officer of the company. "Things are very, very thin."

The plant at Fort Avenue and Woodall Street, which makes paperboard out of waste paper, had been scheduled to close June 20. But there had been two successive extensions until yesterday, when the 130 workers were told the plant would stay open.

"We plan to continue operations with the hope that conditions will improve and permit us to stay in business for a long time," said yesterday's notice to employees.

The fortunes of the troubled company were boosted in late June, when the Baltimore City government approved a new one-year contract for the company to handle the city's curbside paper recycling. The new contract allows Chesapeake to charge a handling fee if the price of paper falls below a certain point.

Under the previous contract, Chesapeake did not charge a fee for taking the paper, regardless of market demand.

The company is still talking to city and state agencies about a possible $12 million financial assistance package for the company. "We're still up to our elbows in the collaborative work effort," Mr. Smith said.

But neither the possible financing package nor the new city contract will determine the fate of the company, he said.

"The key is 'come in early, stay late, 24 hours of hard work,' " Mr. Smith said. "I see it as just bloody hard work."

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