Impacts of Pyramid closure feared; county calls emergency meeting

Martin Kidston

(Missoula Current) Hours after Pyramid Mountain Lumber announced its plans to wind down operations on Thursday night, Missoula County and a number of other concerned partners arranged an emergency meeting in hopes of finding a solution.

On Friday, county commissioners, Missoula Economic Partnership, representatives of Sens. Jon Tester and Steve Daines, and a handful of state legislators met with the timber company to brainstorm a new path forward.

But given the headwinds faced by the mill, rising costs and a lack of housing in Seeley Lake, options may be limited and the clock is ticking down.

“Many of us have known for a while that the timber industry in Montanan and throughout the region, in some respects, is fragile and dependent on broader market conditions,” said Commissioner Dave Strohmaier. “It goes way beyond some of the past debates on timber supply.”

The challenges

Pyramid Mountain Lumber on Thursday evening issued a press release announcing its decision to close. In doing so, the company said it had been hit hard by a number of circumstances, nearly all of them beyond their control.

Among them, the company cited a labor shortage, a lack of housing in Seeley Lake, “unprecedented” rising costs, falling lumber prices and the rising cost of living in western Montana. Together, they “have crippled Pyramid's ability to operate,” the company stated.

“Pyramid’s management group and the Board of Directors have worked on many of these issues for years to try and find a way to address these difficult issues,” the company stated. “Despite their very best efforts, they see no way out of this situation.”

Many of the problems are challenging all businesses in Missoula and other western Montana communities. Housing costs have spiked and a housing shortage remains. Skilled workers aren't easy to come by and keeping them is hard given the cost of housing.

Missoula Economic Partnership has been focused on the issue for the past two years and the problems aren't new to Missoula County. Strohmaier confirmed that housing, workforce issues and rising costs were among the biggest factors leading to the mill's decision to close.

“With their challenges of finding workers, it's extremely challenging for them to increase production, which is absolutely necessary to counterbalance the increasing costs associated with production,” Strohmaier said.

Seeley Lake's lack of housing is also a factor and something that can't be addressed overnight. Among other things, Strohmaier said the community lacks the infrastructure needed to support more housing.

The county has been trying to address it for years but has received push back from some Seeley Lake residents who don't want to pay the cost of infrastructure.

“We've been in those conversation for years,” said Strohmaier. “Even as we speak, we've been in conversation with Pyramid, the school district, the Forest Service and the sheriff's office, looking for ways to address the housing needs of our collective workforce. At this point in time, you either have to commute up there or you have housing, but good luck finding anything new.”

Potential impacts

Pyramid Mountain Lumber remains Seeley Lake's largest employer and the county's last operating mill. The impacts of its closure could be widespread.

Aside from the loss of jobs, closure could mean less local spending by local residents. It could also hurt local businesses and ripple across the local economy.

“There's also the downstream economic impacts,” Strohmaier said. “Some of the waste material from Pyramid Mountain goes to other wood-product facilities. If you're dependent upon waste product from Pyramid, what does that mean for your operation?”

The mill isn't likely to close overnight but instead is eyeing a phased approach to end operations. It still has product on the property that needs to be processed. But once the mill shuts down, it may be harder to start it back up, even if a solution is found.

“To the extent that we see the timber industry as an important component to Montana's economy and land management, it's way easier to keep that industrial infrastructure in place than it is to bring it back once it's gone,” Strohmaier said. “There's been an ever-dwindling footprint of mill capacity in Montana over the decades. This would not only be a huge hit to the Seeley Lake community, but to Missoula County, the state and the broader region.”

Strohmaier said the future of the mill remains uncertain, though the county will continue working with Missoula Economic Partnership for possible solutions.

“There is no one single thing you can point to and say if we resolve it, everything would be better,” Strohmaier said. “What you end up with is the need to reimagine what this industry might look like and how it might function. It's a story that's still being written.”