DOVER-FOXCROFT – About 30 Pleasant River Lumber Co. employees – about half of the sawmill’s work force – have been laid off just weeks after Dover-Foxcroft residents approved a tax increment financing plan so the company could modernize, expand and add new jobs.

The layoffs, which came as a “shock” to many of the employees, are being attributed to a weak lumber market. The company, owned by Gerard Crete et Fils of Canada, regularly employs 60 workers.

“What we’re seeing is a glut in the market,” Kenneth Lavoie, company general manager, said Friday. He said company and town officials were aware that the market was weak when discussions were held about the TIF.

“The market was weak when we asked for the TIF, but it has continually eroded,” Lavoie said. “The lumber market is at about a 10-year low.”

The company received in excess of $150 more per 1,000 board feet last year than this year, Lavoie said.

A town official said Friday that the weak lumber market is an industrywide trend, and the layoffs would not affect the TIF. Dover-Foxcroft Town Manager Owen Pratt said he hoped the market will turn around so the mill can continue its operation.

“We certainly hope they weather the storm,” he said.

The layoffs are expected to have an impact on the community, according to Pratt. “It has a ripple effect on the woodcutters, truckers and everyone the mill does business with,” he said. “It’s a shock to a lot of people,” said one male employee, who wanted to remain anonymous. A letter mailed last week to the employees by the company did not state that they were laid off. Rather, it sounded like they were terminated, he said.

The letter said that when lumber prices reach a level where the company can once again be profitable, then the employee will be reconsidered for employment. The letter ended with a “thank you” and “good luck,” the employee said.

The TIF, which is expected to go into effect next year, offered the incentive for the company to begin a $7 million modernization and expansion project, which is currently under way. Lavoie told town officials earlier this year that the company had to make an investment to preserve the assets or the mill ought to be sold.

One of the selling points for the TIF was the fact that Lavoie said the improvements would create as many as 35 new jobs on a second shift at the random-length sawmill on Route 16.

The market, however, didn’t recover as quickly as anticipated, which forced the company to reduce its operation, according to Lavoie. After months of losses, he said he must take steps to reduce the impact the market has had on the facility. Lavoie said the company decided to take action now to ensure its survival later.

About 30 employees, including office staff, were laid off this month, Lavoie confirmed. In addition to the layoffs, the company is currently not accepting any round wood, the raw material used in the mill.

The company official said troubles first began at the mill in December when lightning struck the motor control center, which controls the sawmill. Lavoie said he had planned to shut down the operation for a short period in January to tie in the new equipment for the trimmer-sorter project, the first phase of the $7 million project.

Lavoie said plans now call for a start-up of the mill on a “much-reduced” level on March 5 and to operate at that level until the market recovers. When that occurs, Lavoie said he hoped to bring back employees who have not taken jobs elsewhere. The second shift will be added soon after, he said.

Even with the weak market, Lavoie is optimistic of a quick recovery because sales of new homes have been strong.

“We are fairly optimistic of the future of this mill,” he said, but added, “It’s going to be tough for the next few months.”