TRAVERSE CITY -- Farmers on the east side of Traverse City "are holding their breath" to see if they have a market for this year's cherry crop.
Cherry Blossom, LLC, of Williamsburg, laid off about 45 workers and stopped processing cherries this week due to problems meeting payroll, a company spokesman said. Cherry Blossom's sister company, WRS Holding LLC, owes almost $41,000 in back property taxes.
The company is working with unnamed third parties to arrange a sale or cooperative agreement to allow it to reopen.
"We're trying to pull this thing together," said Christopher Hubbell, president and owner of Cherry Blossom. "We're in the middle of reorganizing the company."
The processor's financial difficulties are tied to its history of environmental waste disposal problems, Hubbell said. An on-site treatment system couldn't handle its food processing waste, and neighboring residents and the state sued in response to spills and other waste discharge violations.
The company now pays to truck its waste to Muskegon for treatment, but it can't keep up with disposal costs, Hubbell said.
"We did everything we know to make it go; it's just economically devastating," Hubbell said. "I don't say we didn't make mistakes, but it's just devastating."
Michael Corcoran, attorney for Cherry Blossom, said the company is trying to keep the plant afloat. The next few days will be critical for its future, he said.
"Hopefully, by the end of the week we can make something public and calm the fears of the growers," Corcoran said.
Whitewater Township Supervisor Larry Lake grows cherries and said a plant closure will ripple across the farming community.
"It's been a very important facility to help our local agricultural people here," Lake said. "They make a product that's not produced in many other places around the country, and it's a nice niche."
Cherry Blossom finishes sweet cherries for use in ice cream, candy and yogurt.
"I can see this causing a real hardship for the producers of sweet cherries," Lake said. "They are going to have to find markets and it may not be easy."
Al Steimel, general manager of Leelanau Fruit Co., a processing plant south of Suttons Bay, said other area processors may not be able to accommodate growers who utilize Cherry Blossom.
"Even if they have the capacity, it doesn't mean they're going to go out and buy those cherries," Steimel said. "It's not good news for the growers over there."
