Foley, Osten get testy over layoffs at Sprague press conference

State senator and Sprague First Selectman Cathy Osten listens on as Republican Gubernatorial candidate Tom Foley starts a press conference on the perceived economic policy failures of the Malloy administration outside of Fusion Paperboard in Sprague Tuesday July 29, 2014. State Sen. Osten challenged Foley several times on his assertions.
State senator and Sprague First Selectman Cathy Osten listens on as Republican Gubernatorial candidate Tom Foley starts a press conference on the perceived economic policy failures of the Malloy administration outside of Fusion Paperboard in Sprague Tuesday July 29, 2014. State Sen. Osten challenged Foley several times on his assertions. Tim Cook/The Day Buy Photo

Sprague — At times talking over each other, gubernatorial candidate Tom Foley and state Sen. Cathy Osten took part in a heated exchange during a press conference Tuesday that Foley had called to highlight what he called Gov. Dannel P. Malloy’s “anti-business” policies.

Fusion Paperboard announced last week that it was closing and laying off 145 workers, just one year after the state awarded the company a $3 million loan to upgrade its paper machine. Foley said at the press conference, held next door to Fusion, that the announced closure signals larger economic problems in the state.

Osten, who is also Sprague’s first selectwoman, and union employees called Foley’s message “sound bites” and asked where he had been all this time.

“Unlike you, I have actually talked to the company,” Osten said. “I have actually been here. I was here within 10 minutes from the announcement here. I wasn’t here a week and a half later to have a press conference with people. I actually care about what happens in eastern Connecticut. We waited an hour for you to come here for a press conference in front of a company that is not even Fusion. Fusion is up there. This is Caraustar.”

The state’s Department of Economic and Community Development has said that the company must pay back the loan with a penalty fee because it did not maintain operations for the 10 years that the contract specified.

Foley said that if he had been elected governor during the 2010 gubernatorial election against Malloy, this wouldn’t have happened.

“If you have a more friendly business environment, if you have a governor and leader of the economy whose No. 1 priority is to restore economic growth and jobs in the state, then you don’t have to bribe companies to stay here,” Foley said.

During Malloy’s term, Connecticut has faced the largest tax increase in history, and employers have watched anti-business policies such as paid sick leave enacted, he said. These policies slow the economy and drive businesses out of Connecticut, Foley said.

Fusion Paperboard is owned by OpenGate Capital, a global investment firm. Joel Laroche, chief operating officer of Fusion Paperboard, said last week that the operation could no longer be sustained. The company produces high-performance coated, recycled boxboard, folding cartons and packaging for North American food and consumer product manufacturers, according to its website.

The company in March signed a six-year contract with the United Steelworkers union.

Osten said OpenGate Capital made the decision to close the plant down to make money as an international investment firm rather than save the jobs in Sprague. The company also sold the paper machine to PaperWorks in Indiana, which is a competitor, she said. PaperWorks took possession of the equipment in order to “decrease the size of the market,” she said.

Foley said that Osten was blaming everyone but herself.

“You have failed at your effort to keep these jobs here, haven’t you?” he said. “You have failed, and Gov. Malloy has failed along with you, and you have wasted taxpayers’ money.”

Shannon Haddad, human resources manager for Fusion Paperboard, told Foley that his “political points” might work at another company, but not here.

“I hope that this is done soon,” Haddad said. “We are running production. We have employees who are peeking over the fence, and there is a lot of talking about what is going on here. There is going to be a lot of speculation. ... If you could take this somewhere else, it would probably help us all get back to work.”

Foley also told union workers and Fusion Paperboard Logistics Director Michael D’Auria that they were blaming people hundreds of thousands of miles away.

“Listen, you have failed because you lost these jobs,” Foley said.

D’Auria responded, “These guys work their butts off. Every single day I watch them work, work, work. … We did not cause this, as she said. The market drove this business into this position.”

Rich Harrelle, president of Local 1840 of the United Steelworkers union, questioned Foley’s own business practices when his company acquired Bibb Co., a textile manufacturer, as Connecticut Democratic spokesman Devon Puglia did last week.

“Tom Foley’s company made millions of dollars while hundreds of honest, hardworking, middle class workers were laid off,” Puglia said in an email. “I wonder what the people in Bibb, Ga., think of Foley’s new-found compassion for the average working person. He has zero credibility.”

Foley said he wasn’t surprised by the remarks from people at his press conference.

D’Auria said he didn’t like it that the press conference was bringing people into the discussion.

“I didn’t invite you or these people here,” Foley said.

D’Auria said, “Understood, but we didn’t invite you, either. But we are here and want to hear what you have to offer.”

Foley responded by saying he wouldn’t have instituted anti-business policies such as mandating paid sick leave, raising energy costs, raising taxes and sending negative signals to the business community.

j.somers@theday.com

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