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  • The Last Company Town

    Employers used to provide workers with everything from houses to hospitals. It was the American dream – “It was so nice”. Those days are nearly gone.

    There was a time when employers provided everything: houses, hospitals, bars. Such a place still exists—but not for long.

    When the Pacific Lumber Co. started logging in 1863, there were few towns in the dense forests north of San Francisco. So the company built its own. Called Scotia for the hard-handed Nova Scotians who moved there, it became known as “lumberjack heaven”—a complete community with a school, church, post office, family homes, and a power plant that provided electric light years before the White House had it. During the holidays, the company played Saint Nick, stringing lights and giving presents: toys for kids, cash for teens, and a free turkey for every household in town. “It sounds hokey,” says Stephanie Jeffers, 59, who settled in Scotia in 1981 and raised a family in the town. “But it was so, so nice.”

    These days Jeffers isn’t the only one using the past tense to talk about Scotia, the last wholly owned company town in America. Scotia is about to change forever. Marathon Asset Management, a Manhattan-based hedge fund that reluctantly inherited this industrial Eden in a 2008 bankruptcy case, is planning to put the entire town on the market this year, a move worth at least $50 million in real estate (the hotel alone is on sale for $2.5 million) and millions more in saved annual expenses. The idea is to make Scotia just like everywhere else—a place where residents have the chance to own their own homes, elect their own officials, and generally control their own destiny. In other words, the American Dream, as two Marathon executives stressed recently over $28 eggs at the Royalton, a glamorous midtown Manhattan hotel.

    But despite the happy spin, longtime residents say that Scotia—with its manicured streets and Truman Show feel—already amounts to the American Dream. What Marathon intends sounds “more like a nightmare,” says Jeffers, sipping coffee in her company-owned kitchen, with her company-funded fridge covered with tourist magnets from a company cruise. “I’ve lived here so long, I don’t know where I’d go.”

    It’s easy to scoff at such a hyper-dependent existence, and many have. Company towns once dotted the country, meeting a need for laborers in the remote locations where timber, ore, and other natural resources were found. At their peak in the 1930s, they housed about 2 million Americans, including as many as one in five adults in places like South Carolina. But most were shuttered as a result of the post–World War II increase in affordable housing and suburban sprawl, and the name “company town” became a pejorative, immortalized most famously in the country song about a man soul-deep in debt to the company store.

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