The Rev. Dan Schatz was that little boy - the one curled up and asleep at the concert while his parents moved to the music.

The songs were traditional folk, and the music was often spare and lyrics simply put. Once, when Schatz was 8, they were delivered by folk music icon and iconoclast Bruce "Utah" Phillips.

He sang about hobos riding the rails, and rolling hills in West Virginia. What was background music for an 8-year-old has fueled, nearly three decades later, a Grammy-nominated CD coproduced by Schatz.

The West Chester minister helped produce Singing Through the Hard Times: A Tribute to Utah Phillips. The disc is nominated for best traditional folk album in the American Roots category of the 52d annual Grammy Awards.

"What drew me to his music was the incredible poetry," said Schatz, 37, minister at the BuxMont Unitarian Universalist Fellowship in Warrington. "He lifted up people who were forgotten and told their stories."

Schatz, a songwriter and singer who performs at folk festivals, coproduced the CD with fellow musicians Jacqui and Kendall Morse, who live in Maine.

The two-disc compilation of 39 Phillips songs was performed by musicians including Pete Seeger, Ani DiFranco, Emmylou Harris, and Tom Paxton.

Also on the CD are local musicians Elizabeth LaPrelle of Ardmore and well-known singer, guitarist, and harmonica player Saul Broudy of Fox Chase.

Broudy toured with Phillips in the early 1970s, playing harmonica, and later wrote his doctoral dissertation in folklore on one of Phillips' famous stories and songs, "Moose Turd Pie."

"It was a very exciting time for me, and I saw that one could actually make a living at being a folksinger, and that's what I do today," said Broudy, 67.

The project began in February 2008, to raise money for Phillips, who was suffering from heart disease and could no longer tour. Schatz and the Morses meet annually at an informal musicians gathering and jam session in Maine, and Schatz threw out the idea.

The minister, who has a master's degree from Harvard Divinity School, had kept a tape recording of the concert he attended with his parents as an 8-year-old.

Schatz and the Morses began asking fellow musicians to contribute a song to the project. Before long, musicians who heard about the effort began calling them, asking to take part.

DiFranco, who had collaborated with Phillips, offered to release the project on her Righteous Babe Records.

The outpouring is a testament to Phillips' influence on folk music, Schatz said.

Several months after the project began, Phillips, 73, died.

"My dad always said that folk music was like a river," said Brendan Phillips, 32, Utah Phillips' son and a performer on the CD. "You give to it, and that gives you the right to take from it what you will. He was always casting songs down the river, and other musicians picked them up."

Utah Phillips wrote hundreds of songs, rode the rails living a hobo's life, and served with the Army in Korea. He once ran for the U.S. Senate on the Peace and Freedom Party ticket, and he helped found a homeless shelter and peace center.

As coproducer of the tribute CD, Schatz helped shepherd the project - organizing song selection, cajoling artists to send in their tracks, and helping with music production.

His roots as the son of two fans of traditional music fostered his love of the folk genre. Schatz's mother and brother sing, and his father plays banjo.

Schatz even transferred from Earlham College in Indiana to the University of Texas at Austin to try his hand in the town's famed music scene. He eventually found a calling in the Unitarian Universalist denomination, which he says has a lot in common with folk music.

"We are a religion where people are finding their own spiritual path; nobody is telling you what to believe," Schatz said of a religious tradition that he shared with Phillips. "In folk music, nobody tells you what to play - you're making music for the love of music and creating your own meaning."

Schatz, who plays six instruments and has recorded three albums, sings the second verse on the CD's opening track of Phillips' previously unrecorded "Singing Through the Hard Times." He also sings "Queen of the Rails."

Competition in the Grammy category is stiff, Schatz said. The CD is competing against the venerable Loudon Wainwright III.

LaPrelle says they have as good a shot as any.

"This is an amazing project," said LaPrelle, 22, who specializes in Appalachian ballads, and whose knowledge of Phillips was limited before Schatz asked her to participate. "I was so excited to learn what a huge influence he had on so many people who are doing folk now."

Schatz, the Morses, and Brendan Phillips plan to attend the big show Jan. 31 at the Staples Center in Los Angeles. Their award category will be presented at the preshow before the 8 p.m. broadcast.

A few weeks before he died, Phillips called Schatz to thank him for helping to produce the recording.

"I think it meant a lot to him to know his music would continue," Schatz said, "and in some ways, he had become part of folk tradition."

Contact staff writer Kristin E. Holmes at 610-313-8211 or kholmes@phillynews.com.