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Florelle Tissue plant shuts down due to power failure; workers temporarily laid off

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BROWNVILLE — The failure of a power transformer shut down the Florelle Tissue Corp. plant, and eight full-time workers have been temporarily laid off until machinery is repaired.

President Harry Minas said Tuesday that workers are expected to be back to work in three to four weeks at the 1 Bridge St. plant. But the company will need extra cash flow to make the $60,000 repair, he said. Along with mechanical problems at the plant, Florelle is now attemping to prevent foreclosure action announced by in May by Chase Bank, which is seeking repayment of about $630,000 in loans made to the papermaker starting in 2011.

The plant’s three-phase power transformer, needed to operate paper-making machinery, shut down at the end of last week. The plant was closed at noon Monday.

“I had to shut down the plant due to some major breakdowns,” Mr. Minas said. “Yesterday I made the decision to shut down because I couldn’t carry employees on the payroll. We’re in the midst of getting funding in place for operational costs, but we’ve had electrical issues which are hindering our production capabilities. On the other side, we’re also finishing some refinancing and looking for more operating capital.”

Five of the plant’s 13 workers were laid off Aug. 16, he said, because the 94,000-square-foot plant didn’t have an adequate supply of paper to run its paper machines.

Mr. Minas said that if Florelle fails to refinance its loans with Chase Bank, it will seek financing from other financial institutions.

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