AUBURN-Having well-read public officials can be beneficial to local economic development, as Auburn's business community found out in the early 1970s. Then-mayor Paul Lattimore coaxed a Japanese steel company to build its new plant in Auburn rather than in Alabama after he read a newspaper article about a proposed new steel mill says James A. Dacey, vice president or Auburn Steel Company, Inc.The mayor hired a company to study the feasibility of locating the plant in Auburn and then presented the completed study to Japanese officials in Washington. The officials put him in contact with the Koyoei Steel Company, which informed him that it had already chosen a site in Mobile, Ala. for its next generation "mini-mill." But Lattimore didn't give up, and he invited Koyoei management to Auburn to examine the area. After considering the mayor's plan and seeing that the necessary water, power, raw materials, and market were in place, Koyoei decided to build its new mill in Auburn. Mayor Lattimore's reading habits and persistence helped him pull off a "steel steal" that today employs 300 Auburn-area residents.

Austeel, as the company is known, was built on a different model from the giant mills that rolled America's steelframed infrastructure for more than 100 years. "The one-mill business," says Dacey, "is a thing of the past."

The plant began operations very slowly because of the Japanese-influenced management style the owners brought to Auburn, Dacey says. First, the company hired a team of supervisors and trained them in production techniques. The team then split up and more workers joined each team. The teams would then rotate into different production areas."We took melters and trained them as steel rollers," he says. "That was totally unheard of in the U.S. steel industry."

Slowly and carefully, the teams expanded until each side of the plant, melting and rolling, had four teams in place. The plant's production grew from 50,000 tons per year to 150,000 tons per year as the team members improved their skills. The Auburn plant, upgraded in the years since its opening, now produces 450,000 tons per year, Dacey says.

The Austeel plant has no time clocks, as most employees are salaried. The company has no sick days or personal leave; the employee's supervisor approves pay for absences, says Dacey. The policies have worked well over the years, he reports; the company has an 0.4 percent absentee rate-the average U.S. manufacturer reports a 3.8 percent absentee rate, according to the U.S. Labor Department.

Dacey credits the company's survival

and prosperity to its employees' dedication to the business. When clients visit Austeel, he says, they are surprised to learn that individual steelmakers are familiar with the customers' purchases. The company cooperates with local schools in training programs, to ensure a future supply of skilled workers, he says.

Austeel has one of the best safety records in the industry, often going several years without a "lost-time" accident, Dacey says. The plant employs modem, computer-controlled processes to produce steel with a careful regard for the environment, he adds.

A "bar mill" in industry parlance, Auburn Steel Company makes several varieties of steel used in auto, mining, railroad, and other industries.

"We make rounds, squares, angles, channels, flats, reinforcing rod, and special bar shapes," says Dacey.

Austeel also produces its own oxygen used in the melting process.

Austeel's market stretches from Iowa to Maine and as far south as Virginia. Changes in the business have reduced the regional nature of the steel business since the 1970s, Dacey says. Competitors from as far away as Louisiana regularly compete with Austeel in its home area.

Dacey says the company plans to pursue growth through acquisition of existing mill properties. In 1994, the company added a second mill in Lemont, Ill. Each mill is run by a general manager, a post currently left vacant by retirement at the Auburn plant.

The Sumitomo Corp. of Japan owns most of Austeel, as well as several other mills around the world.