In N.D. town where sugar is king, lockout hits hard

Rick Nelson
Retired Hillsboro, N.D., businessman Rick Nelson, 65, says it's time for locked out union workers and American Crystal Sugar Company to come to an agreement. The situation -- now in its fifth month -- is particularly difficult for smaller communities like Hillsboro and Drayton where the largest employer is American Crystal. Nelson was photographed on Friday, Dec. 9, 2011, at the A&R Bar.
Photo for MPR by Ann Arbor Miller

Stalled labor talks between American Crystal Sugar Co. and its factory workers are taking a toll in Hillsboro, N.D., a town of 1,600 between Fargo and Grand Forks where the sugar beet factory is the largest employer.

About 1,300 union workers at five sugar beet factories in the Red River Valley have been locked out since Aug. 1 when they rejected a contract offer.

For many in Hillsboro, the lockout at American Crystal is a topic to be avoided. The mayor refused to be interviewed for this report. So did leaders of the local business association. But local business owners are feeling the pinch.

At A&R Bar, owner Larry Simonson said he's taken a hit since the 250 locked-out American Crystal Sugar workers stopped spending money in town.

Simonson said local business owners are afraid to talk publicly about the labor dispute. They're trying desperately to stay neutral, so they don't lose business from one side or the other.

"You're forced to do what you have to do to help yourself survive."

"This whole town is down. I know most of them and there ain't none of them that haven't told me that they're down. I think it's really bad. We're down 30-40 percent. But we were always kind of the beet plant bar," Simonson said.

Simonson says union workers can't afford to stop for a beer. Replacement workers don't live in Hillsboro and are bussed in and out of town, taking their paychecks with them.

Across town at the Country Hearth Restaurant, Assistant Manager Stephen Johnson said he's noticed a dip in business. Replacement workers don't buy meals here, and locked-out workers rarely eat out.

The restaurant is one of the few businesses in town publicly supporting the union workers. Despite that support, Johnson says sugar beet farmers, who all own a piece of American Crystal, still stop for breakfast most mornings.

"When I'm working I don't talk about the beet plant to the farmers or anything like that. I just stay out of it, but they know how we feel," said Johnson. "Good food is hard to turn down."

Johnson said the restaurant will survive because of business from nearby Interstate 29. But he worries about long-term economic effects of the lockout if it doesn't end soon.


One place in Hillsboro where business is booming is the county social service office.

Kim Jacobson, director of Traill County Social Services, said the lockout is directly responsible for a 20 percent caseload increase, representing nearly 80 families.

The office staff reflect the divisions in the community. Jacobson's husband is a locked-out American Crystal worker. Some of her co-workers are married to sugar beet farmers who are American Crystal shareholders. That creates tension, but Jacobson says social workers are used to setting aside personal feelings and focusing on their job.

But she said it can be difficult to see friends or family members applying for public assistance.

"There's been a lot of tears shed in our offices. People who have worked their entire life," said Jacobson. "They've never once thought they would ever be in the situation that they would have to be looking for public assistance."

A few locked-out workers have left the area to find jobs in western North Dakota oil fields. Some long-time employees are retiring. But workers who choose to stay around Hillsboro face financial challenges.

Locked-out American Crystal workers in North Dakota don't get unemployment, and finding a new job is difficult. Many local employers don't want to hire them because they know they will return to American Crystal if the contract is settled.

Nathan Rahm, 30, is one of the workers who swallowed his pride and applied for assistance last month after draining his savings.

"Your back's against the wall and you can't get any help here, and you can't really find any good employment anywhere, so you're forced to do what you have to do to help yourself survive," Rahm said.

Rahm said the worst part of the lockout is the damaged friendships with factory supervisors who are still on the job.

"I don't see that relationship or friendship ever coming back to the way it was," said Rahm. "It's kind of like a ruined marriage, so to speak."

No new contract talks are scheduled for American Crystal and its union workers, despite efforts by Gov. Mark Dayton to restart negotiations. The company continues to hire what it calls long-term replacement workers.