FRANKFORT – I shed a few tears after corporate managers at AK Steel confirmed our worst fears this week. The Ohio-based steel giant would permanently close the Ashland Works, the venerable steel mill that brought good-paying manufacturing jobs to northeastern Kentucky for nearly a century.
I stand with our world class tradesmen and women and local management with heavy heart. I’ve been a part of bipartisan efforts on the local, state and federal level for nearly two decades to preserve what had traditionally been the backbone of the region’s economy. While trying to do everything in my power to stave off the closing, company officials told me their decision didn’t have anything to do with the quality of the steelworkers or what they produced. It’s strictly a corporate business decision.
That was reiterated by AK Steel CEO Roger Newport in a conference call to Wall Street analysts a day after the plant closing was announced. He said he hoped Ashland’s highly-skilled steelworkers would transfer to the company’s other mills in Indiana, Ohio and Michigan, which are not operating at full capacity.
“To be clear, this administration’s strong actions in addressing unfair global trade issues including the ... tariffs has strengthened our industry,” Newport told analysts, adding that closing the Ashland Works would save $40 million annually. “However, global overcapacity, particularly from China, remains a systemic problem. This along with recent US announcements of new steelmaking capacity and the restart of existing mills will create more competition in the commodity steel markets in the United States.”
As the U.S. steel industry shed jobs for decades, due to automation in addition to growing capacity in countries like China, Kentucky’s elected leaders worked hard – sometimes behind the scenes – to keep the Ashland Works competitive. In 2004 when I was still in the House, the Kentucky General Assembly passed House Bill 593, named the Kentucky Industrial Revitalization Act.
The tax credit program was designed to save good-paying jobs that would be lost without financial assistance. It has been reported that the revitalization act resulted in $40 million in tax relief for AK Steel to modernize the operations.
In 2014, the General Assembly passed House Bill 483 to extend the incentives provided by the revitalization. These incentives allowed Ashland Works to upgrade its equipment for building automotive-grade carbon steel, which in turn provided two million tons of high-quality steel to Toyota, Ford and General Motors.
Upon HB 483’s passage, it was also reported that the blast furnace at Ashland Works annually consumed more than 100,000 tons of Kentucky coal and almost 100,000 tons of Kentucky high-calcium limestone.
In 2016, after AK Steel announced it was idling the Ashland Works’ blast furnace and laying off about 700 workers, the General Assembly once again acted swiftly. This time it passed House Bill 535, a measure I strongly supported. HB 535 was specifically written to help AK Steel get the blast furnace repaired and operational.
I remember meeting Newport, the AK Steel CEO, after the passage of HB 535. I left with the impression that AK Steel was fighting to stay viable in the global market, and it was my hope that HB 535 would make it economically feasible to restart the blast furnace. The plant had already seen its workforce shrink to about 230 workers from a peak of 7,500 in 1954. One of the only operations left at the plant during the visit was a single hot dip galvanizing coating line.
On the federal level, Congress also acted to help steelworkers. It passed the Leveling the Playing Field Act in 2015, which made it easier for workers and businesses to win cases and impose tariffs when foreign countries cheat. The following year, Congress passed the ENFORCE Act to ensure the tariffs are actually enforced.
Despite these significant pieces of legislation and the millions of dollars of tax incentives, we were not able to prevent the flame from being snuffed for good at the Ashland Works. But let it be known, I will continue to work across partisan lines to attract new industry to the region. Bringing new jobs to my district has always been a priority – and that is more relevant today than ever. We have the best tradesmen and women in the world and it is the company's loss.