Ruby 1.9 - invalid multibyte char (US-ASCII)

Im trying to make my rails application (2.3.5) to run on Ruby 1.9, I've this function that make some transformations on a string:

def replace_special_chars(downcase = true)
if downcase 
  string = self.downcase
else
  string = self
end
string.gsub! /á|ã|à|ä|â/, 'a'
string.gsub! /é|è|ë|ê/, 'e'
string.gsub! /í|ì|ï|î/, 'i'
string.gsub! /ó|õ|ò|ô|ö/, 'o'
string.gsub! /ú|ù|ü|û/, 'u'
string.gsub! /ç/, 'c'
string.gsub! /&/, 'e'
string.gsub! /\s/, '-'
string.gsub! /[^a-zA-Z_0-9-]/, ''
string.gsub! /-(-)+/, '-'
string
end

But when I try to start the server, I got this error:

<internal:lib/rubygems/custom_require>:29:in `require':   
/Users/.../lib/nzn_string.rb:11: invalid multibyte char (US-ASCII) (SyntaxError)
/Users/.../lib/nzn_string.rb:11: invalid multibyte char (US-ASCII) 
/Users/.../lib/nzn_string.rb:11: syntax error, unexpected $end, expecting keyword_end
string.gsub! /á|ã|à|ä|â/, 'a'
                ^

from :29:in `require'

What's the right way to do this on ruby 1.9? I don't know what im missing here

Write # encoding: utf-8 on top of that file. That changes the default encoding of all string/regexp literals in that file utf-8. The default encoding for all literals is US-ASCII, which cannot represent á.

To make it project-wide, try: the magic_encoding gem.