SHERMAN STATION – Almost four years after its hardwood mill shut down, Sherman Lumber Co. has ended its 108-year history in this small northern Penobscot County town as the result of a foreclosure by Katahdin Trust Co.

“We’re got a mess here,” Leon Robinson, 63, a mill employee and chairman of the Stacyville Board of Selectmen, said Friday during a telephone interview. “It’s a real tragedy.”

It was Good Friday in April 1999 when company management announced that the mill was shutting down.

The chipping operation reopened during the winter of 2000, and its Ace Hardware franchise remained open.

Last month, on Dec. 27, however, they too were shut down, putting the last dozen employees out of work.

“As long as the chipper and hardware were working, the doors were open and there were benefits and we had a job,” Robinson said. “The hope was always that somebody would come in and see people working and maybe they could run it at a profit.”

The bank officially took over the property on Monday and is expected to put it up for auction in late March, according to Michael Wade, company president.

Wade became president in January 2001, replacing Michael Robinson, who remains a company owner.

Peter St. John, senior vice president in charge of commercial services at Katahdin Trust Co., said on Thursday he was not at liberty to discuss any of the bank’s dealings with Sherman Lumber Co.

On Friday, Wade was at the mill office “cleaning up loose ends” and “trying to make [the closure] as graceful as possible.”

Despite efforts to keep some of the operation running while a buyer was sought, tight markets ultimately brought about the demise of the company that at one time employed more than 100 people.

Wade said the hardwood mill had operated only sporadically since 1999.

In a prepared statement, he noted that in the past, the company’s diversity of products, which ranged from hardwood flooring and spruce and pine boards to soft and hardwood pulp chips, had kept the company in operation. In the end, however, that was not enough to overcome the economic downturn over the last four years.

“Our fortunes are pretty closely tied at this end to Great Northern Paper, and they’re having a pretty tough time of it too,” Wade said.

And the fortunes of Stacyville are closely tied to Sherman Lumber Co.

As the second largest taxpayer in the town of just more than 400 people, the company had a tax bill for 2002 of $93,441, according to Clerk Maryanne Guiggey. That’s about 15 percent of the town’s total tax commitment for last year.

The company’s real estate last year had an assessed value of just more than $2 million, while the personal property was assessed at just more than $2.7 million.

“It’s going to hurt us for a couple of years until our state valuation goes down,” Guiggey said Friday, noting that there is a two-year lag in state valuations. “Local taxpayers will have to make up the difference.”

Selectman Leon Robinson said the impact eventually would go beyond Stacyville and affect other towns in the region that are members of SAD 25 with Stacyville.

He said that because of the mill, Stacyville has a high state valuation. Eventually, when that valuation goes down, the town’s share of the school budget will go down, and the towns of Mount Chase, Patten and Sherman would have to pick up a greater share of school costs.

The foreclosure also is bad news for the employees who got done Dec. 27. Robinson said they will lose their health-insurance benefits and he said some wonder if they will get paid for their last week of work.

“This plant served a big purpose in this area, and it’s gone,” he said.