Year: 2003

As the calendar prepares to turn to 2004, economic analysts project that the regional recovery that has been predicted for the past 18 to 24 months will finally materialize. Those business owners looking for a return to the halcyon days of 1999 and 2000 are due for a disappointment, however; this recovery will be far less pronounced.
’It’s six months out.’

Area business owners have been hearing that now for at least two years. They have it heard so often, many are becoming more than a little skeptical.

It, of course, is the recovery from the recession-turned-economic-downturn that started, by most accounts, in early 2001. This prolonged period of sluggishness will come to an end early next year — if it hasn’t officially ended already, say economic analysts who tell BusinessWest there is plenty of evidence to suggest that things have started to turn around and that it is time to believe the ’six months out’ talk.

Indeed, the technology sector that has been mired in a slump since the end of the Y2K craze is finally showing signs of life. Meanwhile, manufacturers that have been stymied by a persistent lack of confidence among business owners say orders are starting to come in again (see related story, page 19). And the tourism industry, which is becoming one of the pillars of the region’s economy, has outperformed the rest of the state again in 2003 and is looking toward a stout 2004, buoyed by the Women’s U.S. Open to be played next June in South Hadley (see related story, page 9).

Overall, analysts say, the question isn’t whether there will be a rebound, but what kind of upturn it will be.

In short, no one is using the word ’robust to describe the year ahead, and experts say those pining for a return to the glory days of 1999 and 2000 should adjust their thinking.

The phrase being bandied about is "jobless recovery," and analysts insist it is not an oxymoron. Ever-improving technology and enhanced productivity that allows companies to do more with fewer people mean that the economy may well rebound, but without significant new employment.

However, many we spoke with said the recovery won’t be entirely jobless. Manufacturers are expected to do some hiring, and the tourism and service sectors should also add jobs, although they will not be high-wage positions (see related story, page 22). Meanwhile, some are predicting that the availability of land in Western Mass., a statewide commitment to developing a biotech sector, and the sky-high price of housing in the Boston area may finally prompt some companies to take a hard look at the Pioneer Valley as a place to locate.

In general, analysts are predicting a decent bounce for the state’s economy in the year ahead — especially if the current surge in technology spending continues. The Pioneer Valley, which didn’t have so far to fall during the downturn because of the diversity of its economy and less dependence on technology-related businesses, won’t see as significant an upturn.

"Though current conditions are bad and consumer and business expectations are weak, the excesses of the technology bubble may be nearly wrung out of the economy," Alan Clayton Matthews, an assistant professor and the director of quantitative methods in the Public Policy Program at UMass Boston, wrote in the latest issue of Massachusetts Benchmarks, a quarterly report of the state’s economy. "Technology spending appears to be headed back into growth after crashing in 2001 and remaining stagnant through 2002. The Massachusetts economy should begin to turn around accordingly.

"The state is in the process of recovery," he told BusinessWest. "But it won’t feel like it until we see some jobs."

Spending Time

Many of the analysts who spoke with BusinessWest said the recession, or economic downturn, that has visited the region — and the rest of the country to one degree or another — has been unique in many ways, especially with regard to consumer spending and housing prices.

In short, consumers never really stopped spending, and housing prices never declined, said Matthews, who termed this an "investment recession." Indeed, auto sales have been steady — helped along by special financing packages spawned by 9/11 and continued through 2003 — while sales of most other goods, boosted by numerous tax cuts and checks to families from the federal government, have remained strong. The problem has been business spending, said Andre Mayer, senior vice president for Research at the Associated Industries of Mass. (AIM). He told BusinessWest that many employers simply haven’t had the confidence (or the need, in many cases) to move forward with hiring, expansions, new equipment purchases, or investments in technology. If most business owners can become true believers in the economic recovery, then it may become a self-fulfilling prophecy.

"The slow pace of progress in this state has many business owners reluctant to get on the bandwagon," he said. "They want more evidence that things are turning around."

What has really hurt Massachusetts in this recession and kept it from recovering as quickly and profoundly as the rest of the country, said Mayer, has been the concentration of technology-related businesses here. Boston has been especially hard hit, but every region, including the Pioneer Valley, which is far less dependent on that sector, has felt an impact.

But recent statistics show technology spending is on the rise nationally, said Matthews, and that bodes well for the Bay State’s economy.

"U.S. investment spending for information and processing equipment was up 15.4% in the third quarter this year, and it was up 15.5% in the second quarter," he said. "That’s two quarters in a row of very strong growth in investment spending, and all indications show that this will continue."

Another healthy indicator is the Federal Reserve Board’s Index of Industrial Production, said Matthews. That barometer has an ’information and processing business equipment’ component, and that number has been growing since the beginning of the year at a rate of 9.5%. Meanwhile, shipments recorded nationally by the Computers and Electronics Industrial Sector — the largest manufacturing group in the Commonwealth — were up 16.2% for the first eight months of the year.

"New orders are up, and unfilled orders are also up," he said, adding that inventories are very low across the technology sector. "That means that these new orders will have to come out of production."

What all this means for the Western Mass. economy remains to be seen, said Matthews, but generally, what’s good for one part of the state is good for the whole state.

Charting Progress

There are other positive signs of turnaround beyond the technology sector, said Mayer, pointing to improvement in many foreign economies, especially Japan’s.

"It’s been a problem for all of us that Japan has been in a recession for 10 years," he said, noting that exports statewide improved markedly in the first three quarters of 2003. "It looks like the world’s economy is climbing its way back to growth without one big engine to pull it; instead, it’s a lot of little engines pulling together, and I think the Western Mass. economy is well-positioned to take advantage of all this."

As for the outlook on jobs, most analysts say there will be some growth locally, if only because companies that are already stretched thin will not be able to handle a larger volume of orders without adding personnel.

"Companies are pressing people very hard already," said Mayer. "The notion that there won’t be any job growth because improved productivity can make up the difference when orders come in is simply not true."

Allan Blair, director of the Economic Development Council of Western Mass. (EDC), concurred, but told BusinessWest that if there is to be any significant job growth, it must come from new businesses coming into the area. And he and others say conditions are ripe for cultivating new jobs.

For starters, the state is making a real commitment to growing its biotech industry, and the recently passed economic stimulus package contains many incentives for entrepreneurs in that sector. The Pioneer Valley has a suitable infrastructure for that industry to develop, said Blair, noting the research facilities created by Baystate Health System and UMass.

Another factor working in the region’s favor is the still-escalating price of residential real estate in the Boston area, which is making it difficult for some companies to locate there.

"There is a phrase people are using these days — ’drive till you qualify,’" said John Mullin, director of the Center for Economic Development at UMass, referring to the fact that people who can’t afford homes in Boston are lengthening their commute to communities where prices are lower. That same phenomenon should help attract companies to Western Mass.

"I’ve heard more anecdotally than ever before about businesses looking at the western part of the state," he said. "And the prices in Boston are part of the reason why."

Blair said the continued marketing of the Hartford-Springfield Economic Partnership — the Knowledge Corridor — will also pay dividends in the near future. He said site selectors are becoming increasingly aware of the region, and the statistics concerning it, including everything from the number of college students to the price of doing business, are starting to turn heads.

The Bottom Line

While analysts were adding the necessary caveats about any projections for 2004 — and predicating their expectations on no further terrorist attacks or escalating global conflicts — they were generally in agreement that things would improve in 2004.

The question is: how much will they improve?

Few are expecting anything spectacular, but they spoke for area business owners when they said that any upward movement would be appreciated.

And this time, people can believe it when they hear the phrase, ’it’s six months out.’ That’s because, in many respects, it’s already here.

Raising the Profile

Since taking the reins at the United Way of the Pioneer Valley early this year, Jim Horne has been working hard to make the agency more visible in the communities it serves. His broad goal is to see the institution evolve from an organization that merely raises money and then distributes it, into one that helps communities identify needs, establish priorities, and set agendas.
Jim Horne says that, historically, the United Way has been an organization known for raising money and then allocating it. It’s also been known as a group that is anywhere and everywhere during the annual fall campaign, but then goes into hibernation when it’s over.

Since he became president and CEO of the United Way of the Pioneer Valley (UWPV) in January, Horne has been working overtime to change both of those long-held perceptions.

He wants the United Way to be known as group that doesn’t just ask for money every September. Rather, he wants it understood that this is an organization actively involved in the cities and towns it serves — one that takes a leadership role in determining where and how investments should be made in area communities.

In other words, he wants the organization to be part of the agenda-setting process in those communities it serves.

Meanwhile, he’s been working to significantly raise the United Way’s profile in those communities, with the goal of familiarizing people with its purpose, and letting people know that when they take part in a YMCA program or join the Girl Scouts, they’re benefiting from United Way-funded agencies, or partners, as they’re now known.

In his first nine months at the helm, Horne, 43, has made visibility a priority — for himself and the United Way as a whole. He’s spoken to every Rotary Club in the region and has been a regular on the chamber of commerce breakfast circuit. But he’s also gone much further in his efforts to get to know the cities and towns in the area and the issues that impact them.

"I want to establish relationships," he explained. "To do that, you have to really know a community, its leaders, and its issues. I’ve spent a lot of time in Holyoke, Chicopee, Westfield, Palmer, Monson, and all the other communities we serve; I’m doing a lot of listening, and I’m showing them the face of the United Way."

Horne, who came to Western Mass. after a stint as vice president and COO of the Akron, Ohio-area United Way, told BusinessWest that United Ways across the country are facing a number of challenges today.

For starters, he noted that, while Baby Boomers and those who preceded them generally understand the United Way and the reasons for its existence, the younger generations do not, and they need to be convinced there is still a place for it. "It’s not enough to say we’ve been around since 1918 — that’s not going to cut it," he said. "We need to show people that through our work, we can make the community stronger."

Meanwhile, the business landscape has changed across this region and the entire country. The large corporations that facilitated fundraising efforts for United Way chapters are disappearing from the landscape, replaced by smaller businesses whose employees and managers are much more difficult to reach.

Locally, Horne said, there is a perception that the United Way is a Springfield organization, leaving many in area suburbs with questions about if and how the organization benefits them. At the same time, the local business community’s involvement in the UWPV has declined over the past decade or so, he said, adding that he wants to "re-engage" many business leaders.

Since arriving in January, Horne has been addressing all these issues simultaneously. His first priority has been to make the United Way more visible — 12 months of the year — but he is also working to make sure the organization is heard, not just seen, and that, more importantly, it listens.

The Job at Hand

"Upside potential."

That’s the phrase Horne used to describe the UWPV, and the reason why he chose that organization over a United Way in Michigan that was also vying for his services.

While he didn’t actually use the term, Horne implied that the local organization has been underachieving in recent years — from a fundraising perspective and several others — and he saw an opportunity to achieve profound growth.

"I like challenges," he said, noting that, while the UWPV has been successful in raising millions for the dozens of groups it supports, it lags statistically compared to other United Ways nationwide. For example, the UWPV has 12 ’major gift’ donors ($10,000 and above), while other groups its size average between 30 and 50. Meanwhile, the UWPV has 600 gifts in the $1,000-to-$9,000 range (the group known locally as the "Pillar Society"), while others its size have 800 to 900.

Overall, the UWPV has a rate of participation (those who donate) of about 26%, while the national average is closer to 35%. Over the past several years, fundraising has been flat (at or around the $6 million mark), Horne said, noting that there have been several factors contributing to this, including the sluggishness of the economy, a sharp decline in the number of major employers, and some campaign strategies that haven’t been effective in getting the message out.

Beyond the dollars raised, however, the UWPV has some work to do to become more involved in the communities it serves, he said, and move beyond the roles of fundraiser and check-writer.

"I looked at the two geographic areas that I was considering and what their needs were, and became intrigued by the possibilities in the Springfield area," he said. "I wanted to be part of raising the profile of this United Way."

Horne has been involved with the United Way since 1994, but he likes to say that the relationship began much earlier, when, as a 10-year-old growing up in Bridgeport, Conn., he would venture to the city’s Boys & Girls Club after school while his mother, a single parent, worked.

The club was a beneficiary of United Way funding, but he didn’t know it at the time. He would find that out nearly two decades later, when, as a production analyst for Sikorsky Aircraft, he became a loaned executive for the United Way of Eastern Fairfield County.

Active in the Bridgeport community — he was on the school board for three terms — Horne enjoyed the work as a loaned executive so much he decided in 1994 to make a career change and join the organization. He described it as a difficult decision, but one he has never regretted.

"I loved the work I did at Sikorsky … I enjoyed my assignments there, which included product support for the presidential fleet and being involved with some experimental projects," he said. "When the offer was put in front of me and I was trying to decide which way to go, my vice president at Sikorsky, who was also board chair for the United Way, sat me down and asked me where my passion was, and where I saw myself being the most productive in the future.

"I really enjoyed helping people see the value of supporting the community through philanthropy," he continued. "It was my experience then that a lot of folks didn’t understand fully the work that the United Way was involved with and how that work improved the community. I realized that there was enormous potential to engage the business community and potential donors to support the United Way."

He started in Bridgeport as a campaign division manager, and in two years became executive vice president of that United Way. He left in April 2000 to become vice president of the United Way of Summit County, Ohio, and eventually assumed the title of chief operating officer there.

Summit County is what’s known as a metro-1 United Way — one that exceeds $10 million in fundraising — and Horne was enjoying his work there, but he desired to direct his own United Way. Late last year, he became one of 70 candidates vying for the opportunity to succeed long-time UWPV director Ty Joubert.

Horne has spent his first several months in the region getting to know the communities served by the UWPV, and also setting a course for expanding the organization’s role in the region.

The Buck Stops Here

When asked how to go about improving the UWPV’s fundraising numbers, Horne said that assignment has a number of components. Generally, however, it comes down to two factors: access and education. In other words, the organization needs to get in front of more people, and when it does, it needs to present a strong case for the United Way and its partner organizations.

The first task becomes more complicated in today’s business community, one dominated by small companies rather than large corporations, he said. In years past, the United Way could visit those large employers and make a presentation that would reach hundreds, if not thousands, of people. Today, there are only a handful of companies in that category, while the numbers of sole proprietorships, home businesses, and telecommuters are on the rise.

And in many smaller businesses, time-strapped managers don’t have the hours in the day to offer a lengthy program highlighting the reasons why someone should give generously to the local United Way.

To reach the managers and employees of smaller companies, as well as professionals such as lawyers, doctors, and dentists, the UWPV will rely on modern tools like the Internet and direct mail, said Horne, and it will also make more and better use of volunteers who have connections to those in hard-to-reach groups and can provide access.

"What we know is that people give to people," he continued. "And people give to causes — good causes."

Which brings Horne to the second part of the equation — education. "Once we get access, I feel we have a compelling message," he said. "We can show people that, when they contribute to the United Way, they can make their community stronger."

Horne was hesitant to set hard goals for the UWPV, but he believes the organization can reach the $8 million-to-$10 million mark within the next decade.

"If all things remain constant, I think we can get to that level," he said, adding quickly that he will likely need more support from the business community to get there.

"There are a number of community leaders and business leaders who are actively engaged in improving the quality of life in the Pioneer Valley," Horne told BusinessWest. "One of my goals is to find ways to increase their involvement with the United Way’s agenda and have them become a greater part of our work."

"Looking back at the ’70s and ’80s, we had more involvement from the business community," he continued. "While things have improved somewhat in recent years, we still have a number of opportunities to re-engage."

While working to improve fundraising totals, Horne said he also wants the United Way to play a much larger role in setting priorities for how the funds that are raised are allocated — and he said the two initiatives are in many ways intertwined.

"When we increase the visibility of the United Way, and people see us as a true community partner," he said, "I believe people will donate more and they’ll donate more often."

Horne said the goal for the UWPV is to be part of the agenda-setting process, which is somewhat of a departure from its historical mission, but a necessary evolutionary step if the organization wants younger generations to fully understand its purpose and importance to the community.

"Our current process is to raise money in the campaign and then talk with our community agencies to understand better what programs they’d like for us to invest in," he said. "Part of our new strategy is to continue conversations with those member agencies, but also expand them to other service providers and potential programming partners so that we’re better understanding how to maximize our resources."

Ultimately, the goal is to create partnerships with a broader range of non-profit groups, said Horne, who told BusinessWest the shift is part of a nationwide trend toward moving well beyond fund allocation.

Part of the process of partnering with communities is convincing area residents and business leaders that the UWPV is not a Springfield organization, he said, and to that end, the chapter this year staged five campaign kickoff events, instead of the one program traditionally held in Springfield.

"That’s one of the ways we’re making the campaign more personal," he explained, adding that the UWPV is also encouraging its employees to become more involved in their communities by joining civic and fraternal groups and taking roles with neighborhood organizations, human services agencies, and economic development bodies.

"The more people are involved, the better they can help assess the needs of a community and find ways to address those needs," he said. "That’s part of the process of becoming better partners."

United Front

Horne said it wasn’t until he became a loaned executive that he realized that, as a youth, he was benefiting from programs supported by the United Way.

He told BusinessWest that he doesn’t want people to recognize 20 years after the fact that their lives have been improved thanks in part to the United Way.

Through awareness, visibility, and active involvement in area communities, Horne wants to raise the United Way’s profile. By doing so, he knows he can also raise a few more dollars.

The Challenge for Charlie Ryan

The mayoral race in Springfield is over, and Charles Ryan has emerged as the city’s next leader. He won a position it seemed that no one else wanted, and in the weeks and months ahead, he’ll come to fully understand why the field was so slim.

This will be a very challenging time for the city — and especially the person in the corner office. The city is currently in very shaky financial condition, and, by most estimates, things are going to get worse before they get any better.

The budget will be the first priority for Ryan, and he has already given an indication of some strategies he will use to improve the bottom line. These include more conservative spending policies (which are certainly necessary) and also more aggressive pursuit of delinquent property taxes and a campaign to compel the state to fund more of its obligations to cities and towns, including Springfield.

Getting more money from the state — not to mention tax deadbeats — will be very difficult, and we wish him luck with these assignments.

While going to work on the city’s finances, Ryan will have some other challenges, many related directly to the vitality of the city’s business community. At the top of this list, we believe, is restoring a sense of confidence and respect in City Hall. Both of these have been lost in the last term of the Albano administration, and it falls upon Ryan to restore a sense of integrity to the city.

Most members of the Albano administration would disagree, but we believe that the recent undercurrent of corruption and favoritism in City Hall has hurt Springfield’s efforts with economic development. Employers and entrepreneurs looking for places to start or expand a business have many options — locally and across the region — and we sense that many are looking elsewhere, and will continue to do so unless or until they can view Springfield as a business-friendly community where leadership is not pushed and pulled by influence peddlers.

There are other matters on Ryan’s to-do list, however.

For starters, there will be some key appointments, starting with leadership of the Community Development Depart-ment and the Law Department, two posts that are vital for the health and well-being of the city’s business community. Finding good talent will be a challenge, but we believe Ryan can find people committed to Springfield who are willing to serve.

Meanwhile, there is the matter of the city’s Building Department, which is certainly broken and in need of fixing.

As we said several months ago, the Building Department has no real leadership — there is no head of that department at present — and this fact has led to a frustrating backlog of work that has slowed many companies’ plans for development and expansion.

Ryan said many times during the campaign that bulking up the Building Department and giving it the resources to do its job will be one of his priorities. We hope he follows through with this promise and makes an appointment based on qualifications, not politics.

Lastly, we believe Ryan needs to listen and give the business community a stronger voice. Recently, it seems, many policy decisions have been made without clear input from business leaders.

Ryan will have a good opportunity to listen at a business summit set for Dec. 4. Organized by the Springfield Chamber of Commerce and the Springfield Business Development Corp. and sponsored by Banknorth, the summit will provide area business leaders with a chance to set an agenda.

We urge Springfield business owners and managers to take part in that summit and become part of the process. And we encourage the Ryan administration to take what comes from that meeting as a good starting point for his economic development strategy.

There will be no shortage of challenges ahead for Ryan and the team he assembles to lead Springfield. But with every challenge comes an opportunity, and we look upon this new administration as a vehicle for moving Springfield forward.

Cherish Every Child

Sections Supplements

In response to alarming statistics concerning the health and well-being of Springfield’s children, the Irene E. and George A. Davis Foundation has launched its Cherish Every Child Initiative. The multi-faceted effort is a proactive attempt on the part of the foundation to secure a better future for Springfield, and the business community is being urged to get involved because the effort is as much about economic development as it is quality of life.

John Davis likes to relay the story he heard about a traditional greeting among the people of one village in Africa that translates into ’how are the children?’

"It’s not ’hi,’ or ’how are you?,’ or ’what’s happening?’" said Davis. "But, ’how are the children?’ That’s poignant, because that’s how any culture should gauge how healthy it is — by how well the children are doing."

It is with this mindset that Davis, former president of American Saw & Mfg. In East Longmeadow, and the Irene E. & George A. Davis Foundation, the philanthropic organization he serves as a trustee, launched an ambitious campaign called the "Cherish Every Child Initiative." The program, as the name would indicate, turns the spotlight on Springfield’s children — who are not nearly as healthy (figuratively and literally) as anyone would like.

Launched in 2000, the Cherish Every Child Initiative was designed to pinpoint the needs of the children in the state’s third-largest city — most of which are obvious — and to identify ways to address these needs, which are anything but obvious.

Davis — who refers to the initiative as a Springfield endeavor, not a Davis Foundation endeavor — described it as a proactive effort to improve the quality of life for Springfield’s children, and as such it represents a departure from the role of this and most other foundations.

"A lot of our gifts over the years have gone to children’s agencies, and much of that gifting was in reaction to someone coming to us with a need or a problem," he said. "We decided to take a different approach and say, ’what are the needs? … what can we do about them in a proactive manner to stem some of the problems?’"

Through a series of meetings involving government leaders, educators, human services officials, health care providers, and members of the business community, the initiative has identified several targets in an overarching plan for the delivery of integrated, high-quality services to young children and their families. The recommendations include plans to:

• Strengthen and coordinate services to families;

• Ensure early education and care for all children age 5 and under;

• Strengthen the early childhood workforce;

• Promote and sustain programs to optimize the health and well-being of young children and their families;

• Raise incomes for the families of young children;

• Encourage recreational and cultural enrichment;

• Establish quality of life indicators for Springfield’s young children and collect and disseminate reliable data on their status; and

• Develop a community awareness campaign.

Working groups have been addressing each of these recommendations, said Mary Walachy, executive director of the Davis Foundation, who told BusinessWest that a status report is due later this month. When it comes out, the groups that have been working on the initiative will have a better road map for reaching their destination, she said, but the bumps in that road will be many.

"All of the recommendations we’ve identified come with challenges," she said. "There won’t be any quick fixes to these problems, but together we can do things to provide a better future for these children."

Walachy said that one of the initiative’s major thrusts has been early education, and support of an endeavor called Early Education for All, which would provide free pre-school programs for every child in the state. The legislation now working its way through Beacon Hill is exemplary of the type of public policy the initiative is backing to improve the quality of life for Springfield children — and provide a better-educated workforce for the future in the process, she said.

Margaret Blood, who is heading the Early Education of All initiative, is also a consultant to the Cherish Every Child Initiative, and conducted interviews that helped identify the eight target recommendations. She called the effort unique in many ways and also a possible model for communities and states across the country.

"What the initiative has done is convene the community to address the issue of Springfield’s children," she said. "That’s important because that’s how these problems can be solved — with everyone pulling in the same direction." Blood told BusinessWest that the region’s business community must lend its support to the initiative, in part because it has the resources and the clout to influence decision-makers on public policy affecting children and families. But it is also a matter of self-preservation; healthier, better-educated children will create a stronger, more versatile workforce down the road, she said.

Davis concurred. "The business community has to look at its contributions to this initiative, whatever they are — time, money, energy — as investments," he said. "They won’t see any return on those investments in a day or a year, but they will be there in the long run."

Not Child’s Play

Davis told BusinessWest that as he and others first started tossing around the idea of rallying a city around a program to improve the lives of Springfield’s children, the concept seemed like pie in the sky. But he said the sobering statistics kept driving home the necessity of such a campaign.

Those numbers paint a grim picture:

• 39% of the children under 18 (about 2,624 individuals) live in poverty, as defined by the federal government — a three-member household earning $14,630 or less;

• Approximately 18% of Springfield’s households with children are headed by a single parent;

• Almost 63% of children under age 5 who are living in a female-headed household are poor;

• Amost 20% of the 2,000 babies born to Springfield women each year are born to mothers under the age of 20;

• Approximately 38% of these babies are born to mothers who receive inadequate prenatal care;

• 10% of babies are born with low birth weights, and each year, approximately 20 of these babies die before their first birthday;

• Approximately 8% of Springfield’s young children are not covered by health insurance, and there is an extreme lack of routine dental care among thousands of children.

The Cherish Every Child Initiative is working to pull various constituencies — including the business community — together to do something about these statistics, said Walachy. She noted that the foundation, with its clout in the region, especially among non-profit groups vying for donations, has the ability to tear down many of the silos that segregate the groups working on various social issues, and get people in a room.

Once in that room, the goal is to get those groups together to identify needs and collect the hard data required to effect public policy and bring about change, said Walachy, placing emphasis on the need to qualify and quantify the challenges facing children and their families.

"We need to look at what the data is telling us about the children of Springfield," she said. "And then we need to look at what the research is telling us about we ought to be doing about the data we’ve collected, and then from there we have to look at what roles we and everyone else can play."

The enormity of the assignment has prompted many to question where and how to start, said Walachy, who told BusinessWest that all eight recommendations are being addressed at once, and the broad goal is to development a strategic plan of action.

"We start at ’A,’ and eventually we’ll get to ’Z,’" she said, adding that the process with each of the recommendations begins with an understanding of current conditions, and then moves on to setting realistic goals and devising specific methods for achieving them.

She and Davis both stressed that hard data is the key is to not only understanding the issues, but creating real change.

"You need data to make scientific decisions," said Davis. "Anyone can say, ’I think this,’ or ’I think that.’ But we don’t want to guess — we want to know what we’re up against."

One of the key elements of the initiative is public policy, said Walachy, noting that the problems facing Springfield’s children and their families cannot be solved by one foundation, despite its resources and its clout.

"The Davis Foundation isn’t going to end poverty for the children of Springfield, and it isn’t going to increase the pay scales, respect, and educational opportunities for our early childhood workforce," she said. "So a critical component of this work is in the public policy arena and the setting of an agenda that will address these areas we’ve identified."

School of Thought

To illustrate the initiative’s purpose — as well as the many layers of challenges awaiting those involved with this effort — Davis, Wallachy, and Blood focused on one of the recommendations, early childhood education, and a bill before the Legislature to spend $1.2 billion a year for voluntary half-day programs for all children ages 3 and 4 and for full-day kindergarten for 5-year-olds, regardless of their family’s income.

The plan is ambitious, said Blood, who told BusinessWest that the initiative has the backing of a number of business and labor groups — including AIM, the Mass High Tech Council, the AFL-CIO, and the United Auto Workers — that rarely come together on issues of this nature. The concept is also backed by statistics showing that, when children get a quality early education, they have fewer problems later on.

"The research is clear — a child who has a quality early childhood education does better in life," she said, citing data showing that the most critical learning period for humans is from birth to age 5. "They are more successful, they stay out of jail; quality early education cuts down on welfare, it cuts down on special education — there is a huge return on investment."

Those supporting the bill are stressing its long-term economic benefits, not its feel-good elements, and a $300,000 media campaign that began last month has been driving those points home.

But despite the statistical evidence, the "unusual constellation of supporters for the bill," as Blood called it, and the intense lobbying effort, the legislation is facing long odds for funding— at least for the immediate future.

With the state staring at an estimated $2 billion deficit and many popular programs facing cutbacks, both state Senate President Robert Travaglini and House Speaker Thomas Finneran say it will be difficult to fund the bill this year.

And if and when it is funded, there are other issues that will emerge, said Blood, noting that the Commonwealth currently has no statewide vision on how to attract and train the teachers necessary to provide all that early education.

Pay scales in Boston for such positions are about $8 to $10 per hour, she noted, and even worse elsewhere. Unless there is a profound change in how early education teachers are valued — and compensated — there will be problems finding adequate numbers of teachers.

But Blood views the early education campaign — one she has poured three years of her life into — as a marathon, and she says the Cherish Every Child Initiative looks upon its work in the same way.

"We’re looking at this for the long haul — Springfield has the third-highest child poverty rate in the state, and Cherish Every Child is not going to make a huge dent in that tomorrow," said Walachy, who told BusinessWest that the immediate goal is for the community to take ownership of children’s issues and not view them as someone else’s problems.

For the business community, this means coming to understand that investments in children today will generate a stronger workforce tomorrow. Beyond that, however, steps to curb poverty and make children healthier will leave the community with fewer financial burdens, said Davis.

"Most business owners are long-term thinkers — they don’t invest in a new machine and look for the payback the next day," he said. "We want them to understand that the same works when you invest in children; the payback isn’t immediate, but there is a return on investment."

Young Ideas

Summing up the Cherish Every Child Initiative, Davis said it is "a process, not a lightning bolt."

By that, he meant that this is an initiative with no quick fixes, a campaign that will have hard-earned results that may not be seen for many years.

And it’s a process that would move more quickly and more effectively if more people would ask the question, ’how are the children?’

TAKING FLIGHT

Uncategorized

The Longmeadow firm Holland & Bonzagni has developed a national and international reputation for expertise in all facets of intellectual property law, including patents, trademarks, copyrights, and, increasingly, cyber law. The firm’s principals describe this specialty as rewarding work that requires a blend of law and science — and healthy doses of patience.

It’s called the kempshall welt.

That’s the term that has come to describe the buildup of plastic that occurs when the two hemispheres of a golf ball cover come together during the manufacturing process.

The method of removing the welt and creating a virtually seamless golf ball is a process — one that is protected from use by competitors by a patent, said Donald Holland, a principal with the Longmeadow firm Holland Bonzagni, which specializes in intellectual property law and helped secure the patent for the client.

Holland told BusinessWest that when most people think of patents, they think of landmark inventions, the formula for Coca Cola, or the mix of herbs and spices in Kentucky Fried Chicken. In fact, patents can be used to give individuals exclusivity on any new, useful, or unobvious process, machine, manufacture, or composition of matter — or a new and useful improvement to any of the above.

"That includes the kempshall welt and the method for removing it," said Holland, who told BusinessWest that trademark protection extends well beyond the name a corporation puts on a product, and that a copyright can protect everything from a literary work to a storefront design — but many people in business don’t know these things.

Protecting that which the client needs to protect is at the heart of intellectual property law, said Holland, who described his field — one that boasts some 11,000 lawyers in private practice or working for the government — as an intriguing blend of law and science that he and partner Mary Bonzagni both find extremely rewarding.

That’s because much of their work involves helping entrepreneurs get their ideas off the ground. And they have helped several people in the Pioneer Valley and beyond navigate the rigorous course required to turn an idea into reality.

The firm has also represented clients in cases where a product, a name, or even a look was being used improperly by another party. One such case involved Deerfield-based Yankee Candle, which had watched competitor New England Candle Company essentially copy the look of the front of Yankee’s retail outlets at its Enfield store.

This may sound like a case of Goliath squashing David, and the press portrayed it that way, said Bonzagni, but protecting what is yours is part of doing business.

"That was important to Yankee Candle because they wanted to expand their mall stores without being afraid that other people would copy the design and dilute their reputation," she said. "What prompted them to take action was the fact that so many customers were confused; one customer even went into New England Candle and, when making her purchase, wrote out a check to Yankee Candle — which the defendant cashed!"

Other customers were taking New England Candle products back to Yankee Candle, claiming they were inferior and wanting their money back, said Bonzagni, adding that any time a company’s reputation is on the line, it has to take steps to protect it.

If there is any downside to work in the field of intellectual property, said Holland, it is watching so many of the companies that the firm becomes involved with fail to reach maturity. "That’s the frustrating part … maybe one in 10 small businesses actually makes it," he said. "There are a lot of good things we’ve seen that just don’t succeed because people don’t know how to delegate — they don’t know how to let go.

"When we do get that one client that makes it," he added, "it’s a lot of fun."

Holland, who opened his practice 22 years ago, says the firm has enjoyed steady growth over the past several years as its reputation has grown internationally. Like other fields within the law, this one has its ups and downs depending on the state of the economy, and at the moment, business is booming overall — if not locally. But he expects the region, which is about a year behind the rest of the country in terms of recovery, by his estimate, to rebound in the year ahead, bringing more new products and startups into the pipeline.

BusinessWest looks this month at this unique firm and the work it does to help move ideas forward.

Down to a Science

When asked how she ventured into the world of patents and trademarks, Bonzagni said she was working with the solid waste management products firm Camp Dresser and McKee on a sludge-recycling project in Detroit when it occurred to her that there might be something else she could do with her degree in organic chemistry.

She enrolled at Western New England College School of Law and, while there, was encouraged by a professor to take her background in science and apply it to patent law.

Holland also took an intriguing route to his current profession. He earned a degree in statistics from Colgate University, but decided soon after graduating that he did not want to keep track of batting averages or chart trends in mortality.

He actually convened a group of professionals in various trades to gain input on possible career paths. One of the people he invited to lunch happened to be a patent attorney. "He fascinated me the most," said Holland, who told BusinessWest he first earned an Aerospace Engineering degree from UConn, and later his Law degree from the University of Miami.

He worked for several years at the U.S. Patent and Trademark Office working on rotary pumps and turbines for jet engines before creating Holland & Associates in 1981. Bonzagni joined the firm in 1989, and an associate, John Kramer — who holds an undergraduate degree in Electrical Engineering and a master’s in Intellectual Property, joined the company in 1999. The firm also has two legal assistants — Cari Mazza and Karen Alberts — who conduct research and provide other forms of assistance to the lawyers and their clients.

The Holland & Bonzagni team specializes in all facets of intellectual property law, and has helped a number of entrepreneurs take concepts off the drawing board and into the marketplace.

Bonzagni has done a good deal of work for paper companies, including one area firm that makes security threads for currency. She has helped secure patents for not only the threads, but the processes for embedding them in the bills. She has also worked recently with a Pittsfield-based venture — New Energies Solutions Inc. — that is moving forward with its development of fuel cells.

Holland, meanwhile, has represented individuals who have developed products ranging from golf ball dimple patterns to mufflers for jet engines, hand tools to security blankets for children called "Taggies." The engine mufflers, known as "hush kits," help plane owners keep older models in the sky longer, and they actually enable a plane to fly faster and more efficiently. The mufflers, selling for $1.6 million each, went on the market last month after several years of development and testing.

Holland has done quite a bit of work for those in the sporting goods industry, primarily golf. He has represented a company called Big Bend Inc., which has developed golf balls that reduce slices and hooks. He also worked with Chicopee-based Hoppe Tool on securing patents for new golf ball molds and the kempshall welt-removal process. He later did work for Wilson and Spalding on golf ball and club innovations.

The firm’s clients are generally industrial corporations, both foreign and domestic, and include manufacturers of aircraft, food, paper products, medical equipment, computer software, chemicals, electronic components, and other high-tech items. It also services chains of restaurants, hospitals, and other businesses to protect their products — and their reputations.

Indeed, roughly half the firm’s work is in the category of stopping counterfeiters and unauthorized copies of products, or knock-offs, as they’re known.

The Yankee Candle case was perhaps the most high-profile example, said Holland, but there have been many others.

Several years ago, he represented a manufacturer of printed placemats, towels, and other household items in an action against the Christmas Tree Shops chain of discount retail stores, which had commissioned Asian manufacturers to create cheaper knock-offs.

"I worked with eight teams comprised of sheriffs and employees of the client," he said. "We went in and seized 117,000 infringing units from Christmas Tree Shops. We first did some investigation into which of their stores were selling the products, and then we went to court to file a complaint. In the meantime, we had sheriffs in the stores with clickers counting the units sold so we could figure out what kind of damages we had.

"Christmas Tree Shops bought seconds from our client one year, and they sold out in no time," he continued. "The next year, they wanted firsts at seconds prices, and when our client said ’no,’ Christmas Tree Shops admitted under oath at a deposition that they took the client’s catalog, took it to two sources in India, and said, ’reproduce this.’ Within six weeks, the chain had written the plaintiff a six-figure check and become its best customer."

Getting a Rough Idea

Ferreting out knock-off artists and helping clients recover damages is among the most rewarding work in this field — "it makes it fun to come to work," said Holland, who told BusinessWest that both he and Bonzagni have worked with national corporations that make some of the most recognizable products in business.

Recently, for example, Holland mediated a case involving Ben & Jerry’s and its ice cream product known as "Chunky Monkey." A woman claimed the name was hers — she had put it on a children’s book — and sought damages. (He was not at liberty to reveal the nature of the settlement.)

However, most of their work would be considered much more mundane — although no less important — such as trying to help a client or potential client determine if a product or process has already been invented, and if an idea is "patentable."

This can be a fairly involved process — and a potentially expensive one — because a number of steps and government agencies are involved. Thus, the firm is committed to having clients and potential clients spend time, energy, and money only when it is warranted.

Much of the work that the firm does falls into the category of education, said Bonzagni, who told BusinessWest that most entrepreneurs, young or old, are too involved with the development of a product or service, and then the day-to-day operations of the venture they’ve created, to focus on protecting their rights and their trade secrets.

Thus, the firm gives tailored seminars on a wide variety of subjects, such as: Managing and Expanding Your Trademark Portfolio; Trade-secrecy Protection; Seizing Counterfeit Goods; Protecting Your Product’s Color and Packaging; Licensing Technology; Cyber-piracy; and Protecting Software.

The firm also posts regular newsletters on its Web site, www.hblaw.org. This fall’s edition, for example, has articles on the recently enacted Madrid Protocol (see page 72) — which dramatically reduces the costs of international trademark protection — and tips for deterring would-be copiers.

Holland has also authored a booklet — used by many major corporations — titled Corporate Guide to Patents, Trademarks, Copyrights, and Trade Secrets, now in its fourth edition.

These educational endeavors are components of the firm’s larger efforts to partner with clients and potential clients, said Holland. He told BusinessWest that, in that role, Holland & Bonzagni works to help companies and individuals avoid some of the costly mistakes and missteps they can make while trying to get a venture off the ground or protect a product, name, or trade secret.

The processes for obtaining a patent, trademark, copyright, or even a domain name, while not necessarily complicated, are more easily navigated when individuals or corporations have the right information, and this is what the firm provides.

Ideally, the firm would like to help improve a venture’s odds of succeeding, said Holland, adding that this starts by gauging the commitment of the party involved and its willingness to do the grunt work necessary to take an idea to the marketplace. This starts with a patent search and a determination of whether a product is actually new. Holland & Bonzagni can conduct that search, but it would rather the potential client do it.

"When people come to see us, we give them a homework assignment to try and weed out those who aren’t serious," he said. "We don’t want people to spend their money needlessly.

"We want them to invest emotionally, and we want them to invest time," he continued. "If we’re going to spend our time, we want to make sure they have the organizational skills to make their product fly. If they won’t commit to that amount of time, their business isn’t going to make it."

No Secret to Their Success

Holland told BusinessWest that his firm has a framed copy of the check made out to Yankee Candle by that confused customer years ago.

It’s a symbol, he said, of the importance of protecting that which identifies a product or a company — be it a name, a label, a color, or, in this case, a storefront design.

This is the essence of intellectual property law, he said, and it is both an art and a science.

For more information, visit the Holland & Bonzagni Web site atwww.hblaw.org

A Different Spin

By BusinessWest Staff October 1, 2003

Bob Penicka, the new president and COO of Top-Flite Golf Company, has a difficult assignment: reversing the company’s fortunes at a time when golf equipment sales are declining and industry analysts don’t know when they’ll bounce back. He believes that by refocusing some marketing efforts and tweaking already-efficient manufacturing processes, the company can drive higher sales — and profits.

Bob Penicka says the building blocks are in place for a turnaround at the Top-Flite Golf Company.

They have been for some time, said Penicka, 41, who was introduced last month as the new president and COO of the Chicopee-based institution. But some of these blocks — including winning brand names, state-of-the-art technology, and a versatile workforce — haven’t always been structured properly or utilized to their full potential, he told BusinessWest, adding that it will be his job to reverse that trend.

This won’t be an easy assignment, given the ongoing sluggishness in the golf industry and forecasts for more of the same, as well as growing competition across all lines of equipment — balls, putters, irons, and woods.

However, Penicka, who has spent the past several years working his way up the ladder at Top-Flite’s new parent company, Carlsbad, Calif.-based Callaway Golf, firmly believes that, with better utilization of the company’s assets, a return to profitability is possible — and sooner than many people think is possible.

He says that a combination of solid products and efficient manufacturing processes (foundations that have been in place), coupled with a debt-free existence as well as the pressures and incentives that come with being a publicly held company, should be a winning formula for Top-Flite.

"We’re a large enough wholly owned subsidiary to have our own P & L posted separately every quarter," he said. "You will find that having that public scorecard coming out every 90 days is a huge motivator to run your business effectively."

Saddled with heavy debt in recent years, Top-Flite, formerly Spalding, was placed under a great deal of pressure when it introduced new products and brands, said Penicka, adding that the company was forced, in effect, to try and hit home runs. Under the umbrella of Callaway, now the largest golf equipment company in the world, Top-Flite can score with doubles and even singles.

"Without the huge debt load that we’ve had for the past several years, this company doesn’t have to worry about hitting a grand slam every time it steps up and does something," he said. "Our goal is to build on a number of smaller successes, and not try to hit the jackpot with one franchise-winning or franchise-establishing product.

"Callaway Golf is in this for the long term," he continued. "We don’t have to return to profitability in one year to make this a go. That’s a goal of mine — I would like to achieve a profit next year — but we have a longer-term vision."

In a wide-ranging interview, Penicka talked with BusinessWest about Top-Flite, the golf market and its future, and his challenging assignment — to reverse the fortunes of a company that has been underachieving for several years.

Course of Action

Penicka says the Top-Flite name remains one of the most respected in the golf industry — especially within the golf-ball market — and he told BusinessWest that it’s his mission to use that name to drive profits, not merely sales.

To achieve that end, he’s putting together a multi-pronged strategy that will involve everything from revamped marketing to new product development to changes on the factory floor.

He’ll also make full use of a varied business background, one that is grounded in science, not sports, and manufacturing processes, not sales and marketing.

Indeed, upon graduating from Ohio State University in 1984 with a degree in chemical engineering, Penicka went to work for General Electric and its lighting division, where he held a number of engineering and management positions. From there, he went to Harman International Industries in Indianapolis, a maker of branded audiophile equipment, where he served as vice president of Manufacturing for the Automotive OEM Division.

He then joined Chicago-based putter maker Odyssey Golf in 1996, and was serving that company as vice president of Manufacturing when it was acquired by Callaway in 1997. He was subsequently promoted within Callaway to vice president of Manufacturing Technology, senior vice president of Golf Club Manufacturing, and, in 2001, executive vice president of Manufacturing in the golf club and golf ball operations.

He was serving in that capacity when Callaway began its pursuit of Top-Flite this past summer. Penicka told BusinessWest that he understood early on that if Callaway survived the bidding war for Top-Flite, he would be packing his bags for Chicopee.

And as the bidding process for the company continued, Penicka started to scrutinize the company he had watched from 3,000 miles away. While he was not able to talk directly with employees and managers at Top-Flite until the deal actually closed on Sept. 15, he was able to make observations and begin the process of plotting a new course of action.

One thing he and others at Callaway noted was that Top-Flite needed to refocus some marketing dollars. In recent years, Penicka explained, the company invested heavily in marketing its Strata lines of golf balls and its Ben Hogan lines of irons, at the expense of what has historically been the company’s bread and butter — the value-priced Top-Flite golf ball models.

"The Strata and Ben Hogan brands are important to this company, but so is Top-Flite, and it has been getting the short end of the stick recently," he said. "I believe that if we spend some money on that brand, we’ll see an impressive return on that investment."

By focusing more marketing dollars on Top-Flite products, the company will likely regain some of the market share in the value-priced segment of the market that has been lost to a host of new competitors, including Nike, Titleist, Maxfli, and Callaway itself.

Top-Flite once owned about a quarter of the value-priced ball market, and has seen that share erode to about 15%, said Penicka, adding that the company can regain some of what it lost by pushing the brands that put it on the map.

Aggressive marketing will be necessary, he said, because the golf market is not growing at present — Callaway and other companies have created programs in an effort to involve more people in the sport for the long term — and that means equipment makers will have to take a bigger piece of the existing pie if they want to grow.

"I think stagnant would be a generous term to describe what’s been happening in the golf market," he said, adding that sales have been declining for several years for a number of reasons, including everything from the prolonged economic slump to the fact that many young people simply don’t have the time for a game that takes five or six hours to play.

While re-directing some marketing dollars, Penicka will also look to streamline some of the production processes, with the goal of making the company more flexible overall. He described the Chicopee plant as efficient and certainly current with new technology, but he believes there is capacity that is not being utilized.

"Top-Flite is the low-cost producer in the United States, and I think it can compete with some of the golf ball manufacturers in Asia that have very low labor costs," he said. "But there are some opportunities we can take advantage of."

Specifically, he believes the company needs to become more responsive and reduce its lead times.

"We’ve got a large, high-volume factory that is set up to run in big batches; the factory evolved over the years and wasn’t laid out with a lot of flexibility in mind," he explained. "Our product mix has become more complex, and our customer base has become more complex — and demanding. I think there’s some opportunity to go to smaller, batch-type production to where we can be much more responsive to our customers than I think we have been in the past."

Top-Flite has placed a great deal of emphasis in recent years on the quantity of golf balls it produces at its plants in Chicopee and Gloversville, N.Y. — about 1 million a day, according to recent counts — but in the future, more focus will be put on profitability, not sheer volume.

"That will be our priority," he said. "We’ll be happy if, in some categories, we have to sell less product, but can spend less against it and make it more profitable than it’s been. We need to stress profits, not sales."

Looking for a Bounce

Penicka joked to BusinessWest that there are some things about California he won’t miss — including the insanity of the gubernatorial recall vote. "I’m coming to a state where people don’t have to face the prospect of seeing an actor on the ballot," he said.

In making that move, however, he’s taking on a huge challenge, one he believes the entire company is up for.

"I see building blocks here that we can use as the foundation to return to profitability," he said. "There is a great workforce of knowledgeable, motivated people who are hungry right now.

"They want to build on their success and restore the image of the Top-Flite company to what it once was," he continued. "I don’t think it will take us too long to do that."

Past Is Prologue

By BusinessWest Staff October 1, 2003

Uncategorized

Why? That’s the question that dominates the mayoral candidacy of Charles V. Ryan.

Why would someone 76 years old — who first had this job when JFK and then LBJ were in the White House, nearly a decade before I-91 was finished, and when the United States Armory was still the largest employer in the city — want to run now?

Ryan answered that question in a number of ways in a recent interview with BusinessWest. For starters, he said he was asked to run — first by a few friends and supporters, and later by a growing number of people, especially in the wake of publicity following his efforts to have the city take over its libraries from the Springfield Library & Museums Assoc. He also said he was running because no else would step forward and challenge state Sen. Linda Melconian, who announced her intentions soon after Michael Albano said he wouldn’t seek a fifth term.

"I think that’s a sad commentary on our city," he said. "There’s something wrong when the mayor’s not running and only one significant candidate comes forward; I stepped in to fill a vacuum that should never have existed."

But the real reason Ryan is running is to "right the ship," to use his words.

Holding aloft the recent financial review of the city conducted by the Mass. Department of Revenue’s Division of Local Services, Ryan said that document uses hard, plain English to say what many people have known for some time — or should have known: that the city has been spending far more money than it’s been taking in over the past several years. As a result, the state’s third-largest city is taking on water and is in serious danger of sinking into bankruptcy or receivership.

Those are words that some people in Springfield don’t want to hear, Ryan told BusinessWest, and words he says Melconian has castigated him for using.

"She believes we shouldn’t be saying things like that … that we could scare away businesses that might want to come here," Ryan said. "I think that’s the wrong attitude to have. People should be told the truth … I think they can handle the truth."

Ryan said there are a number of issues confronting the city and its business community — everything from troubled schools to a declining manufacturing sector — but the overriding concern in Springfield at the moment is finances. And he believes he can put Springfield back on course, in part because he’s occupied the office before and enjoyed some success there, but also because he has a plan for reversing the trends cited by the DOR.

"I understand the job," he said. "And I’m also my own man — I say what I want to say, and I do what I want to do. Too many politicians are beholden to too many people; I’m not beholden to anyone."

Ryan said he’s ready to give the city at least two years in the corner office, and probably four or more if his health allows him. But he said he would step down in two years if he thought the city was making progress — and if the right candidate emerged to lead the community.

In any case, he believes he’ll have enough time to set a course for reversing the city’s fiscal fortunes.

On-the-money Analysis

Ryan acknowledged that Springfield is a much different city today than it was when he first took office in January, 1962.

There has been a mass exodus of the white middle class, he said, leaving a more diverse, much poorer population in its wake, one heavily dependent on state assistance. Also, the city’s business community has changed. The Armory and many other large employers are gone, replaced by an economy dominated by smaller businesses. And what large employers remain, he said, are mostly owned by out-of-town corporations, as are many of the banks. Ryan also believes the city had better leadership in the 1960s — in City Hall and in the business community.

"We were a city on the move back then," he said. "I would speak around New England, and people would ask me what our secret was. I told them there was no secret, just honest, effective government."

Indeed, while some things have changed in 36 years, the basics of running a city have not, said the candidate, who told BusinessWest that the first rule of governing a community — or running a business or one’s personal finances, for that matter — is to spend less than you make.

This will be Ryan’s first priority, if elected, and he said that much of the focus will be on the revenue side of the equation, not the spending side.

To be more specific, he said he will mount an offensive to collect more of the property tax revenues that have gone uncollected in recent years. He will also push the state to honor its obligations to this city and all other communities in the Commonwealth.

"We’re a city in trouble … right now we’re a candidate for bankruptcy; the day of reckoning is coming," he explained. "I think it’s high time the state started to take us more seriously."

Ryan said he wasn’t running against Michael Albano this fall, and he didn’t want to dwell on what the Albano administration didn’t do or should have done. But he did tell BusinessWest that he thought the city should have put some money aside during the boom years of the late ’90s. Its failure to do so left the community with no option other than mass layoffs when the state was forced to slash local aid early this year.

"The good years are a time when you put some money in the bank and get your city looking attractive for business development — and that never really happened here," he said. "Instead, we’ve been spending $5 million a year more than we’ve been taking in the past several years. Every other community had money in the bank, but we were like a family with all its credit cards maxed out.

"When you spend more than you take in and live beyond your means, that’s a deadly combination."

Just how deadly was spelled out in the DOR’s report.

"In Springfield, past practices and the absence of sound financial policies have left municipal government wholly unprepared for any fiscal crisis," the DOR wrote. "Instead, spending on a budgetary basis has entirely consumed revenue collections. Reserves that accumulated in overlay accounts — a non-revenue source — have steadily been depleted for spending purposes. Uncollected taxes and deficit spending create enormous obstacles to generating positive free cash and are major contributors to the decline in fund balance in recent years.

"The trends are clear," the report continues. "It is becoming increasingly difficult to keep the city in the black at year end. If current practices persist, the city will continue to experience a decline in fund balance and will reach a point where it fails to meet the accepted tests of fiscal stability."

Dollars and Sense

Ryan says that, if elected, he has no intention of allowing those practices to continue.

He says he wants the city to spend no more — and preferably much less — than it takes in, and the key, naturally, is to raise more revenue, so the city won’t have to cut programs or personnel to balance its budget. And one place to start this process is in more vigorous property tax collection.

Ryan said the total owed the city is about $43 million, and it has been growing steadily over the past several years. A lack of personnel to collect bills that are past due is part of the problem, but he says the city hasn’t had the will to find solutions to this problem. "We send out a tax bill, but there’s no follow-up," he said, adding that this scenario will change under his administration.

"We need to make this a priority — and right now it’s clear that it isn’t — and we need to articulate that we intend to make sure the deadbeats honor their responsibilities like everyone else does. And I’m not going to have any amnesty periods — I want people to pay up, and that includes interest and penalties."

When asked how much of that $43 million total could be collected, Ryan said he isn’t sure, but believes the city could realize 50% or more if it becomes aggressive with tax collections and commits energy and resources to that task. If elected, he said he will seek out communities that have a strong track record in tax collections and work to employ best practices here.

He said he can and will be aggressive on tax collection, and that’s something Melconian — who was late with tax payments on two different properties 42 times over a 12-year span and cleared up past-due notices just before she announced her candidacy — can’t do.

"How can she get in front of people and try to get tough on tax delinquents with her track record?" he asked. "She can’t be taken seriously on that matter … people will laugh at her and say, ëif she didn’t pay, I’m not going to pay, either.’"

While working on tax collections, Ryan said he will also try to establish a better working relationship with the state and, in the process, work to receive more of the help that one of the largest communities in the Commonwealth deserves.

He said the state has mandated a number of programs in recent years, but has not followed through with the money to pay for them. The current fiscal crisis facing the Commonwealth is no doubt part of the reason, he said, but another is a simple lack of accountability.

"Not only is there a legal and moral obligation on the part of the Commonwealth to be supportive," he said, "it’s in the best interest of the state government to join with us in a partnership to not only save the third-largest city, but revive it."

He said bankruptcy would obviously not be good for the city, but it would also be detrimental to the Commonwealth, and this is a point he will stress to the Romney administration.

"If we got our fair share, we would be successful; it’s as simple as that," he said. "We have to restore stability to the point where our revenues exceed our expenses every year. Until or unless we do that, we’re highly vulnerable.

"This is not a highly complicated problem," he continued. "But when you’re starved for revenue — and we’re talking about revenue that you’re entitled to, from the tax deadbeats on one hand and the Commonwealth of Massachusetts on the other — you’re heading for a very bitter conclusion."

Balancing Act

Overall, he said the city must face up to its fiscal troubles and confront them, not hide from the facts or stand in denial.

That’s why he believes Melconian is doing the city and its residents a disservice by skirting words like receivership and denying that this is a real possibility for the city unless current trends are somehow reversed. He called such an attitude part of a conspiracy of silence, one that won’t fool any business contemplating a move to Springfield.

"To think that someone is going to come in here and invest $15 million or $20 million without taking our temperature or finding out what our financial condition is — that’s malarkey," he said. "All I want to do is change the facts, not use semantics to hide the facts.

"Instead of having less revenues than expenses, we’ll have less expenses than revenues," he continued. "Instead of having an empty bank account, we’ll have money in the bank; instead of having an alienated business community, we’ll have a business community that will become my partner in making this happen."

When asked what he thought he could accomplish in two years (if that’s how long he stayed in office) and if he could attract talented people to his administration knowing his time in office would be brief, Ryan acknowledged that these were fair questions.

As for the former, he said he could, in a short time, set a new tone for the city and achieve significant progress on key financial issues. He said the process starts with leadership and convincing the state that the city is being managed in a fiscally responsible manner.

"A big part of my job will be to open an aggressive, but also proper and respectful, communication with Gov. Romney and his key advisers," he said. "I want to show to them that Springfield will be under leadership that is going to run this properly and correctly and efficiently."

As for attracting talent, Ryan said he’s been able to do so in the past, and can again, by striving to recruit people who want to work on behalf of a city, and not for a mayor.

"That’s the key," he said. "If people concentrate on the city and its future, and not on how old I am or how long I might be in office, we’ll do fine."

Beyond professional staff, Ryan believes he can recruit what he called "dollar-a-year people" — retired individuals and others with expertise to lend the city on a mostly volunteer basis.

"People have already talked to me about that — they’re ready to jump in," he said. "And we’re not talking about licking envelopes; these individuals want to be part and parcel of a new leadership team.

"Part of what this mayor will do is restore effective leadership, and while doing that, we’ll work with and challenge the business sector for more, and the colleges for more, and the unions for more, from a leadership perspective," he said. "We can’t just say the mayor is the ballgame; the mayor is merely one of the leaders."

Vote of Confidence

Returning to the question of why he’s running for mayor, Ryan says he’s doing so because he believes he’s the captain that can right the ship. And he believes he can attract a talented crew to help him in the process.

"I firmly believe we can be successful," he said. "I wouldn’t be running if I didn’t believe I would get a positive response from the governments or individuals that I need to get a positive response from … I don’t believe in suicide missions.

"It’s a case of charting the course and defining the plan," he continued, adding that those basic ingredients in running a city haven’t changed in four decades.

Blazing a Trail

By BusinessWest Staff September 1, 2003

Sections Supplements

C2C Systems, a Reading, England-based company with an American subsidiary based in Springfield, recently added NASA to its client list. The space administration was looking for help trying to track a flow of E-mails among engineers in the days before and after the Columbia disaster. C2C is making a name for itself in this emerging technology field, and that reputation is leading to dramatic growth.

Jon Brown follows the scandals closely.

Enron. Tyco. ImClone and Martha Stewart. Worldcom. Even the demise of the Space Shuttle Columbia. As those stories broke, he waited for his phone to ring. Usually, it did, because where there’s scandal, there’s usually a paper trail or, in this day and age, an electronic trail. And Brown’s company, C2C Systems, can help a client uncover that trail or, if the customer so chooses, make it disappear.

C2C Systems Inc., the American subsidiary of Reading, England-based C2C Systems, Ltd., is headquartered in the Springfield Enterprise Center (SEC) in the STCC Technology Park. The local company sells and services software programs that help companies, government agencies, and other entities manage their E-mail. And that word manage can take on a number of definitions, said Brown, director of the Springfield operation. Sometimes it means capacity management or archiving. It can also mean controlling E-mail, everything from identifying and eradicating inappropriate or unauthorized E-mailing to tracking down specific correspondences.

And it can also mean deleting E-mail — and when Brown says delete, he means DELETE.

"We provide people with the tools to discover the mail and, when appropriate, to destroy it," he told BusinessWest. "People want us to help them find mail and in some cases delete it. And when they say delete, they don’t mean mark it for deletion; they mean ’make it go away.’

"We make some proprietary technology that goes deep into the bowels of an exchange to get rid of the mail," he said, opting not to be more specific about exactly how the software works. "We can make it so it’s nearly impossible to find."

NASA called on C2C not long after the Columbia disaster because it wanted to track some of the E-mail correspondences between engineers after the shuttle went down, said Brown, adding only that the agency apparently found what it was looking for.

The space administration contract wasn’t large — maybe $10,000 — but having NASA as a client brings benefits beyond the check, said Brown, who told BusinessWest that there have been some discussions with the agency about using it in some promotional material.

If those endorsements do come to fruition, they will likely help the company as it enters what Brown believes will be a strong growth phase. C2C will soon expand within the SEC, effectively doubling its space and adding several new employees as it does so. And Brown believes the venture can move from its current $2 million in sales to $10 million and beyond with more aggressive sales and marketing and new product development.

Indeed, he said work with companies with scandal problems constitutes a very small percentage of sales. Real growth is expected to come in the wake of new regulations regarding when entities must keep and destroy documents, as well as a new global focus on IT security.

Meanwhile, virtually every company and government agency is struggling to keep its E-mail under control, said C2C President David Hunt.

"Capacity has become a huge issue … companies are struggling to find ways to reduce their volume of E-mail," he told BusinessWest from the company’s headquarters in England. "But E-mail is becoming the center of the knowledge flow, or information flow, of a company, so people can’t really be expected to reduce the amount of E-mail; what they have to do is develop a better form of management of it, and that’s where we come in."

Virtual Reality

Brown refers to this niche as the developing specialty of "E-mail life-cycle management." In short, the company helps clients keep their E-mail legal and affordable through a variety of tools and consulting help to implement those tools.

Its products fall into two main categories, said Brown: compliance and discovery — specifically, compliance with laws and corporate policies regarding retention and other issues, and discovery of items that are lost or deleted — and mailbox-size management. This latter series of products helps mid- and large-sized companies deal with the volume of E-mail.

Specific products include, on the capacity side of the ledger, Archive One Capacity, an E-mail archiving and capacity-management solution for Microsoft Exchange; and MaX Compression Enterprise, a family of products that transparently zips and unzips attachments sent and received with Microsoft Outlook, thus saving bandwidth and storage space.

On the E-mail risk-control side of the operation, the company’s main products include Active Folders Content Manager, which controls content and protects an organization from legal liability; and Exchange Security Risk Auditor, a tool that keeps unauthorized individuals from reading one’s E-mails.

The company has provided software to some 3 million users at more than 3,000 organizations worldwide, including national and multi-national corporations and government offices, and believes it is only scratching the surface of the industry’s vast potential.

"I think we’ve carved out a good niche for ourselves in the marketplace," said Brown. "Our goal is to expand that niche and grow the company."

How Brown came to run C2C’s American operation is an intriguing story. A biology and Spanish major at Amherst College, he joked that it wasn’t those courses of study that prepared him for a career in telecommunications. "Instead of a car, my parents bought me an IBM PC, and I locked myself in my room for a month trying to learn how to do something with it," he explained.

He was tending bar at an Amherst alumni party and wound up pouring scotch for an executive with a top-10 software company called Pansophic. "He offered me a job, and I went off to Chicago, without knowing anything about the company or what I was going to do with it."

Brown wound up becoming a product manager for the firm, but was squeezed out after the company was bought by Computer Associates. He then went into sales for System Software Associates (SSA) in Chicago, but left at 25 to pursue an MBA at UMass.

His first stop after earning his degree was a New Hampshire start-up called Tally Systems, where he was a "product manager with no products." But he helped develop one after witnessing a shouting fit by the company’s controller.

"She was screaming about the E-mail bill because, at that time, you had to pay 10 cents a message for MCI to deliver your E-mail over the Internet," he said. "And our E-mail had gone from $300 a month to $1,000 a month in no time.

"I sat outside her office and thought, ’if we’re this little 40- to 50-person company and we’re having this problem, then big companies must be having a huge problem with this,’" he continued. "I went out and talked to about 100 companies, big ones and small ones, and came up with some specs for a product that would help them manage their growing E-mail volume."

Brown put together a company, which became a subsidiary of Tally, and raised $3 million in venture capital to start an operation that essentially allowed companies to put in place an E-mail charge-back and reporting process, similar to what is done with long-distance phone calls.

The company did well, but it was never a core function for Tally, which saw its fortunes plummet when the Y2K craze ended, and eventually gave Brown’s company the axe in a cost-cutting move in early 2000.

That’s when Brown approached C2C, a maker of similar E-mail management software products that was then his largest distributor in Europe, and asked if that growing company would like to fund his venture. Instead, C2C asked Brown to direct its American subsidiary and become a partner in the parent company. "They said, ’you bring us to America.’"

Net Results

For the past three years, Brown has been doing just that.

He ran C2C Inc. out of his home for a while before being introduced in late 2000 to the Springfield Enterprise Center, the recently opened small-business incubator that was housing a number of startup ventures.

"It was a really nice fit for us," he said. "We were looking for a place in which to get settled and commence the growth process, and that’s just what we’ve done."

Brown said his obvious mission is to grow sales of C2C products in North and South America, and to do that he must raise awareness of E-mail capacity and risk issues, and then sell businesses and government agencies on the company’s various solutions to those problems.

And while the scandals that have dominated the business pages in recent years have led to some high-profile clients, Brown and Hunt both stressed that everyday capacity and security issues will drive most of the growth for the company.

When he first opened C2C’s American subsidiary, Brown identified 22,000 potential target customers, which he described as businesses or agencies that use Microsoft Exchange, have 500 or more employees, and have three or more locations.

That number probably hasn’t changed much in the past three years, he said, but there are now certainly more reasons why those potential customers should be interested in C2C products — starting with capacity.

"That’s becoming an issue for everyone," said Brown. "The volume keeps growing every month as more and more people make E-mail their preferred method of communicating information. Companies are going to need ways to keep that volume under control."

Meanwhile, on the risk-control side of the equation, there are a number of new laws regulating the dissemination, safe storage, and ultimate destruction of information, said Hunt. He cited HIPAA (the Health Insurance Portability and Accountability Act), which regulates information about patients and ensures that such data remains private, as one example of greater regulatory control of information — including E-mails. Similar measures are, or soon will be, in place for the financial services industry and other business groups.

"There are new laws requiring entities to retain E-mails for a certain period of time," he said. "This could be two years or seven years after an employee leaves, for example. And there are also more regulations about what is to be kept — or not kept, as the case may be — and companies are going to have to deal with them."

All this will add up to new opportunities for C2C Inc., which Brown believes can double or triple in size in each of the next several years. And in anticipation of a bulked-up sales and marketing initiative, the company will double its space in the SEC and remain there as a tenant for the foreseeable future.

Meanwhile, Hunt anticipates expanding C2C’s American operation and adding more offices over the next few years. The headquarters will remain in Springfield, however.

Tracking Growth

Brown told BusinessWest he was somewhat surprised C2C didn’t get a call when the ImClone scandal broke last year. "That’s one we missed," he said.

There haven’t been many such incidents in that category, thanks to a growing reputation for helping companies and agencies find what they are looking for.

What C2C is looking for is additional growth — on both sides of the Atlantic — and it would certainly seem to be on the right track — literally and figuratively.

Playing Politics with Public Safety

By BusinessWest Staff September 1, 2003

In the wake of the tragic nightclub fire in Rhode Island last winter, most cities and towns in the Commonwealth have become more serious about code enforcement and the broad issue of public safety. Here in Springfield, however, we are apparently going in the opposite direction.

The city’s Building Department is currently rudderless and woefully understaffed. There is no building commissioner per se — the the man who owns that title, Peter Garvey of East Longmeadow, is officially on unpaid leave, but working a full-time job with Barr and Barr Inc., a regional commercial builder, and reportedly trying to figure out what to do with his life. At the same time, an official from the Personnel Department is signing the checks and keeping track of payroll, while the people left in the department can’t begin to keep up with the workload.

Meanwhile, the city’s senior building inspector, Steven Desilets, has been promoted to acting assistant building commissioner, passed over for the top post due to politics, not credentials. What that does is give the city someone who is properly credentialed in a position of quasi-authority — someone who can sign permits and legally conduct inspections. What it doesn’t do is resolve the larger issue confronting the city — a situation where an office critical to public safety and economic development is being run into the ground in the name of cost-cutting and politics.

To be succinct, Springfield needs a full-time building commissioner — not four months from now when the Albano administration thankfully comes to a close, or whenever Garvey decides to end his leave in the private sector — but now. And we urge city officials to take the steps necessary to resolve this matter and give this department leadership.

What’s happening in the Building Department — or not happening, as the case may be — is very important to the business community and to the public at large, for a number of reasons.

For starters, the department is, in effect, City Hall’s liaison to the business community. Anyone who wants to construct a building, put on an addition, add a pool, or install a new bathroom needs permits from the building office to proceed.

Many business owners have seen their projects delayed over the past year because inspections are backlogged and paperwork is getting lost in the shuffle due to a lack of personnel. And when businesses can’t move forward with their projects, they move on to other cities and towns without Springfield’s problems. The city also loses vital revenue when inspections — for which businesses and individuals are charged a fee — are not conducted.

But the larger issue is public safety. The Rhode Island nightclub fire showed just how critical it is to have each and every nightclub, bar, and restaurant inspected regularly for code violations. Springfield has a large stock of older buildings that could become instant death traps. It appears the mayor doesn’t feel it’s an important issue. But this city can’t keep the public safe if it doesn’t have enough people to conduct needed inspections.

Yet, staffing is only one reason why the Building Department is in such disarray. The larger issue is leadership, or a lack thereof.

The department didn’t have much leadership when Garvey was on the job. Nor did he set a good example by misleading city officials and the press about his residence, according to sources (department heads are required to live in the city; he did not). But it’s had no leadership since he took the private-sector job.

It appears the mayor sanctioned Garvey’s leave as a cost-cutting move; one can’t fill a position if it is technically still occupied, and with Garvey on leave, the city can save his salary or use it to keep other people employed. While that might help Springfield with its current budget crunch, it is putting the city in a very dangerous position — one where it is playing with fire, figuratively if not literally.

The Building Department is certainly not the only city department facing difficulties. There have been layoffs across the board, including devastating cuts in the schools and police and fire departments.

But the building office is one of the three pillars of the city’s public safety infrastructure, and it needs a solid foundation — it needs leadership. A police department or fire department can function without a chief, but it shouldn’t. And neither should a department that plays such a critical role in business and economic development.

The city should move immediately to put a qualified, full-time commissioner in the Building Department, and then give that individual the tools needed to get the job done. In short, Albano should stop playing politics with public safety.

What Goes Around

By BusinessWest Staff August 1, 2003

Business owners who feel aggrieved often believe the courthouse is their first, best option. But business lawyers say that cool heads must prevail in such situations, and parties must always be aware of the potential for a counterclaim.

The deal with Interstate Litho Corp. was going to be the biggest of Marc Brown’s career.

Brown, a broker of new and used printing equipment, had entered an agreement with Brentwood, N.Y.-based Interstate to secure and recondition two used presses. The agreed-upon sale price was $2.6 million, which would earn Brown, who did business as Integra Technical Services, a tidy $200,000 in sales commissions and profits.

But Interstate Litho backed out of the deal at the 11th hour and eventually purchased a new press from a third party. Brown was frustrated, but essentially accepted his fate.

That might well have been the end of the story, but Interstate President Henry Becker decided to aggressively pursue the $75,000 deposit he put on the two machines Brown was going to sell his company. When Brown refused to return it, claiming the deposit was non-refundable, Becker took him to court over the money. In the course of finding the paperwork substantiating his claim that the deposit was non-refundable, Brown and his attorneys also came across a written agreement for the purchase of the two presses, a document that would become the cornerstone of a counterclaim against Interstate charging the company with breach of contract.

When the dust settled, a federal court jury in Boston awarded Brown a judgment totaling $227,029.

There is a moral to this story, said Keith Minnoff, a litigator with Springfield-based Robinson Donovan, who represented Brown: always beware the counterclaim!

"There are lessons here for both sides from this case," Minnoff told Business-West. "First, for companies filing claims, always think several moves ahead. And for the defendant, don’t be on the defensive; go on the offensive — as long as you have a case."

Minnoff and other lawyers we spoke with say they have dozens of examples where a defendant in one court action eventually became a plaintiff in another, and the party that originally brought suit wound up paying far more than it was originally seeking in damages.

"Companies have to think twice before they fire the first shot," said Minnoff, who told BusinessWest that many business owners who feel aggrieved are often quick to pull the trigger, especially when they don’t get paid in a timely fashion for services they provide.

Bob Murphy, a litigator with Spring-field-based Bacon & Wilson, concurred. He told BusinessWest that many business owners take a ’let’s sue the bastards’ attitude, especially when their products, services, or reputations are called into question or a customer is very late in paying a bill.

"That’s exactly when cooler heads need to prevail," he said. "When you go into the litigation process, you have to go in with your eyes open; you can’t — or shouldn’t — just run to the courthouse."

He said there is often a very good reason why a customer doesn’t pay when the bill comes due, and business owners must examine such situations with diligence and full honesty before telling their lawyer to file a claim. If they don’t, they’ll put their lawyer in a hole, and, much worse, they could endanger the company they’ve built.

That’s why it is incumbent upon business owners and their attorneys to weigh possible litigation as a business decision, one with possibly damaging repercussions.

"Sometimes, you just have to walk away, or even run away, from a suit," said Lisa Brodeur-McGan, a litigator with Springfield-based Cooley-Shrair. "You have to be smart and examine all the possible costs of a suit before going forward."

BusinessWest looks this month at a few intriguing counterclaims involving local companies, and the lessons they provide for all business owners.

Back at You

Minoff told BusinessWest that, while it might seem obvious to consider counterclaims before taking a case to court, area law firms have file drawers full of cases where a party failed to look before it leaped — or look hard enough.

The reason is obvious, he said — it is a logical reaction to seek redress when someone believes they’ve been wronged, and in this increasingly litigious society, the courtroom is considered the first, best option.

Brodeur-McGan agreed, and said that business owners should understand that there are some attractive alternatives — including a decision to simply walk away from a fight, especially when the many costs of taking up that fight haven’t been properly calculated.

Indeed, Brodeur-McGan said the first thing she does with a client or prospective client is look at what a case may cost that individual — in terms of legal fees, time spent away from their company while in court, and possible damage to the reputation of the person, the business, or both. This is all part of the process of determining whether it’s worth it to pursue a claim in court.

Part of this equation is consideration of possible counterclaims, she said, adding that, in some cases, prudent business owners are better off letting sleeping dogs lie or pursuing a more amicable method of seeking relief, such as mediation.

When a business or individual wants to bring a case to court, a good lawyer will urge his client to look at the matter rationally, said Murphy. "Both the business owners and the lawyers have a responsibility to step aside from the emotions of the situation and look at things objectively and go into any litigation process with their eyes open, because it is so consuming in terms of time, money, and emotion."

Brodeur-McGan said lawyers must play devil’s advocate and ask their client or potential client the right questions needed to keep that individual out of harm’s way. Often, this means asking that individual to be brutally honest when assessing why a customer hasn’t paid for goods or services or has failed to honor the terms of a contract.

"Often, there’s a very good reason," she said, "and the business owner has to look and find it. Sometimes, it’s not obvious; it may have nothing to do with the shipment that was just received, but the shipment from five months before."

In any event, a business or individual should always expect a countersuit and fully gauge the ramifications of such an action when pondering a suit, said Murphy.

He cited as a good case in point the example of a local business that sued a leasing company and manufacturer over allegedly faulty equipment.

"This company did two things that turned out to improvident," he said. "They stopped paying on the lease, and they pre-emptively filed suit against both the leasing company and the manufacturer, claiming defects.

"As a result of that action, counterclaims were filed, and the eventual outcome was that this local company sought bankruptcy protection because the leasing company prevailed on its claim that money was owed on the lease," he continued. The company could never really get into its arguments about the performance of the machine because what took precedence were documents it signed that spelled out the terms for inspecting equipment and accepting delivery — terms it violated.

"Did they have a valid claim against the manufacturer? Perhaps, but they still had an obligation to pay under the lease provisions," said Murphy. "So this was a situation where they either got some bad advice, or they thought the aggressive pursuit of this claim was the best route. What, in fact, it got them was a ticket to bankruptcy court, which was obviously not the intended result."

The leasing company wound up winning a settlement for the amount owed on the lease, about $80,000, said Murphy, but also its attorneys fees, as dictated in the lease agreement. Such attorneys fees are often a "big stick" in counterclaims, he told BusinessWest, and they are a factor that must clearly be weighed when contemplating a suit.

"This appears to be case where someone just didn’t consider the worst-case scenario; if they had, they probably wouldn’t have taken such an aggressive action," he said. "That’s one example where taking the most provocative stand and actually pre-emptively filing suit can come back and hurt a company. Any business person out there needs to know that counterclaims can and will be filed against them."

Case Study

Brodeur-McGan said there are a number of factors she and her clients consider when they weigh potential suits. These include the strength of the claim, obviously, the hard costs of pursuing it (everything from filing fees to attorneys fees), and the ability to recover damages. "You have to add it all up and decide if it’s worth your time and trouble."

Another factor that goes into that decision is what she called "the risk of adverse action by the person you’re suing," or counterclaims. And that’s why parties should look at all their options, including less-aggressive methods of seeking redress.

These include mediation and binding arbitration, which are almost always less costly and less stressful than court cases. "If you resolve something without a lawsuit, that can often tone down the emotions," she said.

Minnoff agreed, and said that often, it isn’t until a party becomes a defendant in one action that it decides to become a plaintiff in another. He cited a case involving a parcel of land on Riverdale Road in West Springfield as a good example.

In the case, Sunoco Inc. (R&M) v. Makol Family Limited Partnership, Sunoco brought suit against Makol for not honoring an option agreement signed when Sunoco entered into a long-term lease with Makol in 1993 to operate a gas station, car wash, and convenience store on the commercial property. That option allowed Sunoco to purchase the property in 2000 for $1.75 million.

Makol claimed it refused to honor the option because Sunoco subleased the car wash operation to F. L. Roberts, a step not allowed in the lease agreement.

When Sunoco filed suit seeking a declaratory judgment that its option had not been terminated and an order requiring Makol to sell the property at the option price, Makol quickly counterclaimed, seeking 50% of the rents collected by Sunoco from Roberts under the improper sublease.

Sunoco and F. L. Roberts representatives tried to prove that Makol knew of the arrangement between those companies from the outset and never objected until just before the option period. Meanwhile, Sunoco argued that it never would have agreed to split the sublease rents with Makol and, if necessary, would have operated the car wash itself.

But a jury saw things differently and, following a four-day trial, awarded Makol $231,000 — about half the rents received by Sunoco from Roberts between 1993 and 2002 — and the court added $124,000 in pre-judgment interest and $86,604 in attorneys fees, for a total award of $440,630.

Minoff, who represented Makol, said he couldn’t say with any certainty whether his client would have pursued his claim if Sunoco hadn’t forced the matter of the option agreement, but it’s very possible that Makol would have not have pressed its claim if not provoked.

"You don’t want to nudge an angry snake," said Minoff. "That’s how many counterclaims get started."

And while the sum eventually paid in the Makol case might have been worth the risk for a large corporation trying to acquire valuable property on Riverdale Road, most smaller companies can’t easily afford the costs of a successful counterclaim, said Minoff. And that’s why business owners and their lawyers must think possible legal action through before rushing to the courthouse.

Business owners should never easily forfeit their rights, he continued, but they should put possible court action in a business context. Henry Becker took a gamble and lost, he said — all for a $75,000 deposit. That’s not an insignificant amount of money for most businesses, but Becker’s actions wound up being penny-wise and pound-foolish.

Case Closed

Murphy told BusinessWest that many counterclaims that are filed turn out to be meritless — actions taken by defendants in an effort to cut their losses or make gains when they are not entitled to any.

But a good number of such suits do have merit, and they can change the fortunes of the parties in a legal action in a hurry, he said.

That’s why companies and individuals need to think several moves ahead in whatever legal chess game they’re playing, and always consider the worst-case scenario.

In the case of Marc Brown and Interstate Litho Corp., the company’s greed and its haste in filing suit wound up costing it three times the amount it had originally sought — a $300,000 swing — giving Brown an even bigger payday than he had imagined.

Banking on the Future

By BusinessWest Staff June 1, 2003

Westfield Bank prides itself on maintaining the same reputation for personal service over its century and a half in business. But in many other respects, the institution has had to change with the times — and bank officials are keeping their eyes on the shifting needs of its residential and commercial markets, looking to continue a pattern of measured growth in a highly competitive region for banking.

When Westfield Bank — then known as Westfield Savings Bank — opened its doors for the first time in 1853, 13 people, most of them residents of the growing town, opened savings accounts.

Today, as it celebrates its 150th anniversary, Westfield Bank boasts 10 locations, $813 million in assets, and the third-largest market share in Hampden County. However, ask President Donald Williams about the bank’s long history, and he’ll tell you that more has changed in the past two decades than in the 13 before them.

"When I was hired in 1979, Westfield Savings Bank was a thrift," he said. "Our assets were primarily stocks, bonds, and real estate loans, and our liabilities were passbook savings accounts and CDs."

But by the late 1990s, the bank had taken the word ëSavings’ out of its name to reflect how commercial lending and other business services had become a crucial part of the company’s business. And a decision in 2001 to offer shares in the company for public trading has led to a dramatic increase in the bank’s capital for lending and its flexibility in making larger loans.

In a highly competitive region for banks — one that has seen many growing towns in Western Mass. become overbranched in the past few years — Westfield Bank is taking a cautious look at growth, strengthening its presence in areas where it already has a footprint before turning to new markets.

Yet, steady growth has been one constant in this bank’s 150 years, and Williams told BusinessWest that it intends to remain a strong regional player in savings and lending services.

Humble Beginnings

Back in 1853, Westfield — a community already 184 years old — was a growing town, with a population of 4,300 and rising, a number of growing industries, and a need for more banking services. "We were primarily a provider of low-cost deposits and mortgage loans. That was the reason for the bank’s existence, according to its charter," said Alice Babcock, vice president and director of community banking.

In its first days, the institution shared space — a common practice among banks of that time — with First National Bank until 1866, when Westfield Bank moved upstairs. Continuing its growth largely in the personal-savings arena, the institution had built $1.8 million in assets as the 1900s dawned.

Geographical expansion began with a West Springfield office in 1940 and an Agawam branch in the 1960s. Today, the bank boasts 10 offices in seven communities, including East Longmeadow, Holyoke, Southwick, and Springfield — the latter of which replaced teller windows with a more business-oriented, one-on-one style of banking in an effort to boost the commercial-lending side.

Meanwhile, the bank’s assets have steadily grown through the years, to $3 million in 1913, $7 million in 1923, and $100 million in 1975. That’s a far cry from the $813 million the bank held at the end of 2002, as the last 20 years have brought the most change, with commercial and business banking services leading the way to a new focus, Williams said.

Those changes have hardly come by accident, however. In fact, the bank launched a strategic plan about a decade ago that incorporated three elements: taking ësavings’ out of the name, opening a branch in Springfield, and increasing the bank’s volume of consumer lending. All those elements have come to pass, and the business-lending emphasis is still a developing one, said Williams.

"We’re trying to diversify the balance sheet," he explained. "It’s a long process, and we’re hoping to be where we want to be in 10 years." Going public was a major step toward building more flexibility — and allowing loans of up to $15 million — all the while keeping 53% of the ownership in the hands of the bank’s customers.

The push for more commercial lending has, of course, been slowed to some degree by the sluggish economy over the past few years, as businesses are slower to make capital investments.

"It’s a very competitive environment right now," Williams said. "But we’ve maintained a good backlog, and when the economy gets better, we expect to pick up some growth in that area. But, in this region, with so many banks, it will always be competitive."

Branch Boom

That competition is partly the result of a branch boom among area institutions, who have moved quickly and aggressively to place offices in growing communities such as Ludlow, Belchertown, and Easthampton.

Williams said that, for now, Westfield Bank’s strategy is not to compete for additional territory with the community banks that already have footprints in such towns.

"It wouldn’t be in our best interest to compete with some of those community banks solely on rates," he said. "We don’t want to jump markets. Those are local institutions that do a good job. It would be better for us to look for additional opportunities where we already are."

That means expanding the brand in communities that already have Westfield Bank offices, including the placement of additional ATMs in strategic locations, such as in Shriners Hospital and in the American International College campus center, two recent Springfield additions.

Further cultivating existing geographic strengths without building several new branches makes sense, he said, because it’s consistent with the way the bank has grown throughout the years.

Williams noted that, while Westfield ranks behind only Fleet and Banknorth in Hampden County market share, those banks have 30 and 20 branches, respectively, while Westfield has only 10 — so success has clearly been a matter of making each of a limited number of locations as productive as possible. "We’re looking for ways to really solidify that presence."

One challenge for a 150-year-old bank, Babcock said, is balancing the needs of two different clienteles: a new breed of younger customers who value convenience over anything, as well as a number of older customers who have been with the bank for generations and appreciate personal service most.

Leading up to the 150th anniversary celebration, she said, some longtime customers showed tellers decades-old mortgage books from the days when mortgages were paid in person monthly and the books were stamped accordingly. Nowadays, the process is more impersonal — mortgages are billed and paid by mail, and they may be bought and sold by multiple institutions over the life of the loan.

The dilemma, if one could call it that, Babcock said, is that a bank with many decades of history must give older, longtime customers the personal touches they have come to expect, while also investing aggressively in Internet banking — including a Web-based cash-management system launched last year — as well as ATMs and other convenience-minded services that appeal to younger depositors.

"The good news is that we’re 150 years old," Babcock said. "But that’s also the bad news. If we’re going to continue to thrive, we need to meet those different expectations that customers have."

A Banking Continuum

But the bank simply considers that another challenge. What bridges the gap between both types of clients — those who need bricks-and-mortar, personal contact, and those who are happy banking from home — is an emphasis on a relationship, Williams said.

"We’re not looking to get a customer who wants to do just one service with us," Babcock said. "We’re looking at a relationship" — and that means offering a wide-enough variety of services to draw in new customers, such as cash management services and lockboxes, and then making an effort to get to know customers and their needs personally.

It helps, she said, that the bank has very little turnover among its loan officers, and makes an effort to cultivate a continuum of services by not passing customers from employee to employee. "The client gets to know the lender, and vice versa," she said.

The relationship priority also extends into the community at large, as Westfield Bank continues to donate to local organizations through its Future Fund, with an eye on spreading the wealth evenly into all the cities and towns it serves.

Those seven communities could be joined by others in the future — the institution certainly isn’t abandoning all geographic expansion — but, for now, Westfield Bank seems well-positioned to rely on its strengths in building a greater presence in Hampden County.

"Our financial strength, combined with our non-financial assets, like good customer service and strong relationships with our communities, positions us well for our next 150 years of measured growth," Williams said.

There’s that word measured again. And, by any yardstick, Westfield Bank has been one of the county’s financial success stories.

The Albano Administration Betrayed Springfield

By BusinessWest Staff June 1, 2003

BusinessWest turned some heads last month when we suggested that Springfield Mayor Michael Albano could no longer effectively lead the city in the final months of his term and should thus step aside. We said the ’starting-over’ process should begin now, not next January, when his eight-year tenure comes to an official end, or when he gets another job — a task made more difficult by the specter of a probable indictment.

Some people wondered what a business publication was doing focusing on City Hall and what the mayor is doing or, more to the point, not doing. And some readers must have been confused because, only 16 months before, we were strongly endorsing Mayor Mike over respected challenger Paul Caron.

Well, some things have happened in the past year and a half that have prompted us to reconsider some of those earlier opinions. Summing them all up, we’d call it a betrayal of the city’s residents and the business community. Meanwhile, we believe what happens in any city hall has an important impact on any community’s economic health and well-being. That’s why we reacted as strongly as we did to recent events.

The perception of this city has been damaged to such an extent that the Albano administration has become a source of chaos and embarrassment to both area residents and the business community, not the instrument of progress that an administration should be. The residents and the business owners of Springfield deserve better, and they deserve it now.

You might ask, what should people in business expect from City Hall?

Often, they expect too much, which can be a problem in itself. Indeed, almost any time a business fails or never gets off the ground, the entrepreneur in question will say, ’the city didn’t do anything to help me.’

And while such claims are often an exaggeration and a cop-out, sometimes they are not. Springfield is a good case in point.

Any city or town government can do things to make it easier for businesses to succeed — everything from a small grant or loan to help get a company off the ground; to help with zoning, traffic, or parking; to a tax-incentive plan that makes coming to a community more attractive. And local government can set a tone that makes businesses want to come to a city and stay there. The phrase business-friendly is often overused, but some communities are certainly more friendly than others. Springfield is friendly to a chosen few, friends of the mayor, and that’s wrong.

A municipal government can and should deal with matters in a fair and equitable manner, and that’s what we didn’t see from the Albano administration. Instead, we saw grants, loans, leases, and no-bid contracts — some possibly against state law — go to people with connections to Albano.

We know and understand that a certain amount of graft and favoritism happens in many large cities. But in Springfield it was carried out to a degree that it created a sense of frustration in the business community, a feeling that insiders and power brokers were running the city — and running it into the ground. Businessmen and developers have voted with their feet and located their companies and buildings in other Western Mass. cities and towns rather than hire Albano’s friends as "consultants."

When all is said and done — and as the revelations from the FBI probe have made clear — the record will show that some of those connected to Albano effectively looted Springfield. That’s a strong word, but it fits. They took jobs, those aforementioned grants and loans — some to reputed organized crime members — and sweetheart deals, all with Albano’s approval and, in some cases, with his signature on the agreement.

Even more alarmingly, Albano and his friends stole the city’s reputation and a good deal of the momentum that had been built up from such efforts as the Basketball Hall of Fame, the riverfront, and the downtown entertainment district.

It was this ’looting’ that prompted BusinessWest to step out of its traditional role, to forcefully criticize Albano and his administration, and advocate for moving Springfield forward now.

City Hall can’t do everything for a business, and it cannot, by itself, make a venture work. But a municipal government must be fair and work for all the people — not a chosen few. Because it failed to do so, the Albano administration has failed Springfield miserably.

HIRE CALIBER

By BusinessWest Staff June 1, 2003

Mary Ellen Scott, president of United Personnel Services, has forged a successful career in the challenging staffing industry, a field she joined somewhat reluctantly nearly 20 years ago. She’s also made her mark in the community, taking a lead role with several business and economic development groups.
Like many women, Mary Ellen Scott said her early career path was defined largely by her husband’s professional travels. Manhattan; Teaneck, N.J.; Boston; and Springfield. Those were some of the places where her first husband, Jay Canavan, found management positions at non-profits ranging from the Museum of Fine Arts in Boston to the Quadrangle. As she followed her husband from city to city, Scott managed to find jobs, she told BusinessWest, but not a career.

But the last time she followed him, however, she did.

That was when Jay, then 51 and in search of work after a five-year stint at the Quadrangle, decided to start his own company, an employment agency, in Hartford. He asked her to join him in that venture, but she told him she already had a job — director of human services at Gemini Corp. in Springfield. She eventually acquiesced, however, and, after the company survived a rocky start, she took the lead role in making it one of the most successful staffing services in the region.

Jay Canavan passed away in 1999, several years after officially retiring from the business. Mary Ellen, who remarried in 2001, continues to grow the company now known as United Personnel Services. The company has three offices — Springfield, Hartford, and Easthampton — and recorded 20% growth last year, in the midst of sluggish economic times that usually pose stern challenges for this industry.

Meanwhile, Scott has taken an increasingly larger role in the community. She is currently president of the Springfield Chamber of Commerce, and board member

at the Economic Development Council (EDC), the Springfield Enterprise Center, and Springfield Symphony. She enjoys being active, and is upbeat about the region and its prospects for further development.

In a wide-ranging interview, Scott talked about the process of making the transition from employee to entrepreneur, and the risks and rewards that are part and parcel to that change. She also weighed in on the economy, and the prospects for the Pioneer Valley and the city of Springfield, which has been her home for 25 years.

"We’ve seen some good things happen in this city, but there are lot of challenges ahead," she said, referring to both the economy and the controversies that have damaged the city’s reputation. "There’s lots to do and no money for anything. But Springfield is resilient, and it has a lot going for it."

Work in Progress

Scott says she is asked often about the state of the local economy, especially during trying times like these.

She theorizes that her vocation might have something to do with that; those in the staffing business will often know what’s happening before those in other sectors. Also, her involvement with various business and civic groups helps keep her ear to the ground, and people want to know what she hears.

But she told BusinessWest that, despite all that, her crystal ball doesn’t work better than anyone else’s, and she admits to being puzzled by the current economic slump, which follows some, but not all, of the patterns of traditional downturns.

"Some sectors have really been hit hard, while others don’t seem to be impacted nearly as much," she said. "The economy is down — a look at the skinny help-wanted section in the paper will tell you that — but we’re having a very good year at this company; how do you explain that?"

Canavan has seen a number of economic cycles since she segued into the staffing industry two decades ago. She and her husband started in the booming mid-’80s and rode the wave that defined the end of that decade — expanding the operation into Springfield as they did so. They then toughed out the prolonged recession of the early ’90s, when many companies in that sector did not, and positioned itself to capitalize on a surge in the use of temporary and temp-to-hire workers in the mid- to late ’90s.

"It’s been a bit of a roller coaster," she acknowledged. "But that’s what this business is like. For the most part, I’ve really enjoyed the ride."

How she got on the roller coaster is an intriguing story. As she told BusinessWest, Scott initially rejected her husband’s requests to join his entrepreneurial venture. However, new management at Gemini — which saw things differently than Scott did on many personnel matters — and Jay Canavan’s difficulties with finding the right idividual to help him get the company off the ground eventually led them to team up.

"He couldn’t pay a ton of money, and joining a start-up operation was a risk that many people weren’t willing to take, so he really had a hard time finding the right person," she said. "Eventually, we decided that if we were going to do this, we should do it together, so I gave my notice."

The venture, known then as United Industrial Temporaries, struggled to get off the ground. "We didn’t have an order for three months," she said. "I got a paycheck, but Jay didn’t get one for nine months."

The economy was booming then, with unemployment at 2.3%, and companies were desperate for good help. The problem was establishing a reputation and breaking into the market. "Those were scary times," she recalled. "The phone didn’t ring."

Eventually, it did, however, as some of the larger insurance companies, like Aetna and Travelers, placed some orders. United opened a Springfield office soon thereafter, and that facility provided some cushion for the company when the Hartford financial services sector went through a period of downsizing in the early ’90s.

Scott said she quickly assumed many of the managerial responsibilities from her husband, who eventually retired in 1995. She presided over strong, steady growth and watched the company crack the Inc. 500 list of the country’s fastest-growing companies in 1993 and 1995. Current revenues are approaching $6 million.

Today, a staff of 18 works in the company’s Main Street offices in the former Springfield Five Cents Savings Bank building, where Scott says she acts largely as the company’s public relations person. "I’m the face in the community," she said. "I still do some sales, but mostly I try to promote the company and keep our name visible."

She described the staffing industry as one that is relatively easy to get into — despite her own personal experiences — but one that is much harder to stay in because of the heavy competition and the economy’s wild mood swings.

She said United has done well because of its diversity and also its ability to "go the extra mile," as she put it. "When one side of this business is down, the other seems to pick up."

Canavan described herself as a good delegator who doesn’t micromanage, but does like to challenge employees.

"I like to give people responsibilities — and then I expect them to handle those responsibilities," she said. "I try not to step on anyone’s toes, and I essentially just let people do what they were hired to do. We have a very collegial atmosphere here. I want people to say they enjoy working here; that’s important."

She said she has no real pearls of wisdom for women, other than advice to give their entrepreneurial talents a chance to flourish.

"It’s scary to go from getting a paycheck every week to the situation we faced when we started — when we didn’t know if we’d get a paycheck," she said. "But what makes it scary also makes it fun."

Getting Down to Business

As Scott’s status in the local business community has grown, she has become involved with a growing list of business and civic groups, including the EDC, the symphony, and the Enterprise Center at STCC. She told BusinessWest that she understands that some of the requests for her participation are made with the goal of achieving gender diversity on those boards, but she acknowledged that the pool of women business leaders is not particularly deep, and thus her phone rings often.

Two groups she has become very involved with is the Affiliated Chambers of Commerce of Greater Springfield, and, more recently, the Springfield Chamber — she’s the first woman to be named president of that group — which was created in 1996 and now boasts nearly 900 members.

Scott told BusinessWest she’s been involved for years with the thorny subject of tax classification — she’s one of the few business owners who also lives in the city and thus sees the issue from both sides — and the ongoing effort to bring the commercial rate down, thus making it more attractive to current and prospective businesses.

"That’s just a part of the larger issue of making the city more business-friendly," she said, adding that the Chamber and the Albano administration have made it a priority to not only attract new businesses, but work to retain those already here. "Retention is a very big part of that equation, and it often goes overlooked. Everyone’s focused on bringing new businesses here, but you also have to create an environment that makes companies want to stay."

Meanwhile, she says that perhaps a bigger challenge will be enticing people to live in the city.

"Young people are not opting to move to Springfield, and that’s a big problem," she said, noting that, while a long list of attractive suburbs certainly contributes to the dilemma, the city’s struggling schools and other quality-of-life issues don’t help, either. "Springfield is just not an attractive option for many people.

"I’m not sure how we go about changing that situation," she continued. "But it’s something we all have to work on."

She told BusinessWest that a confluence of recent issues — everything from the economy and the state budget to the controversy enveloping City Hall, to the pending departure of UNICARE and its 800 employees from 1350 Main St. — has created a number of challenges for Springfield that will certainly test its mettle.

"UNICARE’s leaving will have an effect on a lot of businesses downtown, especially the restaurants, bars, and clubs, and even the parking authority," she said. "It’s going to take some time to replace that many workers and fill that much office space, and that’s why we have to keep working to make the city business-friendly."

She said the controversy that continues to swirl around Albano and many current and former members of his administration, won’t help in the regard, but she’s not sure just how much damage the prolonged FBI investigation and the Feds’ almost weekly raids of downtown bars and city agencies will have on the city’s psyche and its economic development efforts.

"There’s a bit of a dark cloud over the city right now," she said, "and that’s too bad in a way, because Mayor Albano has done a lot to revitalize downtown and give it some life."

The Bottom Line

When pressed to comment on the prospects for the local economy, Scott said the region is in what she called a holding pattern.

"People are hesitant to make moves," she said, "because they don’t know what’s around the corner. They’re looking for some sign that things are better, and they’re just not seeing one they can believe in.

"Business owners are waiting for something positive to happen," she continued.

Plenty of positive things have happened to Scott since she arrived in Springfield. Some of her success can be attributed to the whims of the economy and some good fortune, but mostly, she’s made her own luck.

She believes Springfield and the Pioneer Valley can do the same.

"We have a lot to build on here," she said. "But we can’t wait for it to happen — we have to make it happen."

Time to Move Springfield Forward

By BusinessWest Staff May 1, 2003

Uncategorized

When Mayor Michael Albano was asked last month if he would resign amid the flap over the reassignment of embattled former MCDI director and police commissioner Gerald Phillips, he said such a step would serve no useful purpose.

We see things differently.

Resigning wouldn’t serve Albano who is still looking for his next job or his friends and political allies, and maybe that’s what the mayor was referring to when he made that statement. But it would serve the city very well.

This is a difficult time for Springfield, with hard decisions to be made in the coming months about budgets, layoffs, and maintaining vital services. The person leading the city through this white water should be respected by the city’s residents and other appointed and elected leaders and he should be a true leader. And right now, Albano simply doesn’t deserve that respect, and for that reason, he cannot effectively lead.

Indeed, when we wrote last month that Albano’s apparent disregard for the city and its voters was bad for the community and bad for business, and that his lame-duck administration was sapping strength from the city, we didn’t think things could get much worse. We were wrong.

The mayor’s reassignment of Phillips, who has been indicted on a number of federal charges, including intimidating a witness, to the Holyoke office of that job-training agency has, in fact, made things much worse.

That move has made it clear to just about everyone that Albano is far more interested in making sure that his good friend has a paycheck than he is about what’s best for Springfield and Holyoke. And what scares everyone or should, anyway is the fact that Albano still has nearly eight more months in office.

The Phillips situation has prompted many city councilors to propose a no-confidence vote. Is one really needed? We believe that an unofficial no-confidence vote has already been taken by the city’s residents and its business community.

And it’s been well-earned. Over the past few years, close to a dozen members of this administration have been indicted on charges that vary in description, but all boil down to abuse of authority, behavior sanctioned by Albano. And while Mayor Mike has not been indicted on any charges yet, he is ultimately responsible for what has happened on his watch.

Albano’s tenure in office has been in many ways like that of a crime boss.

While he may not have committed the actual misdeeds, he created and condoned an environment in which members of the ’family’ could abuse justice and break laws. And that they surely did. Albano’s legacy will be one of disgrace and corruption.

The depth of the credibility problem now facing Springfield was made evident at last month’s trade show put on by the Affiliated Chambers of Commerce of Greater Springfield. This is an event always dominated by talk of the economy where it is and where it’s likely to go. This year, the economy took a back seat. Actually, it was put in the trunk, as all the talk centered around the Phillips reassignment and when, not if, the mayor will be indicted.

Business owners speculated that the ongoing federal probe, the resulting indictments, and the embarrassment all this has brought to the city have done more to harm Springfield than any bad economy or military conflict ever could. While this might be a stretch, there is no doubt that Albano is doing the city more harm than good remaining in office.

In the final analysis, we believe it is time to move Springfield forward. That’s now, not next January. The FBI can help by moving this investigation along. It has had nearly three years to build its case, and we suggest that it shift into a higher gear. The longer people in Springfield have to speculate about who will be indicted next, the longer it will take to return this city’s full focus to the pressing issues facing it.

And Albano can help by understanding that he can no longer do anything positive for Springfield. He has become a liability and, to a growing number of residents, a pariah. With every move Mayor Mike makes, people will wonder if he’s just taking care of his friends or quieting someone who may have something to tell the FBI. And that’s something the city simply doesn’t need.

If the mayor really wants to do what’s best for the city, he’ll step aside now.

Fixing the Courts

By BusinessWest Staff May 1, 2003

Sections Supplements

A panel of business and academic leaders has determined that the state’s court system is ’mired in confusion’ and in need of sweeping reforms. But achieving those changes which begin with clearer administrative authority and tougher performance standards won’t be easy.

Discussions of legal issues often tend toward excessive wordiness. This one, however, got right to the point.

By blasting the Commonwealth’s judicial system as being "mired in confusion" and dysfunctional in its management structure, a panel called The Visiting Committee on Management in the Courts might have raised a few eyebrows, but didn’t shock too many observers of the courts.

How to fix the courts’ problems, however, is where differences of opinion begin.

The Visiting Committee, a panel of business and academic leaders appointed by Supreme Judicial Court Chief Justice Margaret Mitchell with the backing of the state Legislature and Gov. Mitt Romney’s administration is calling

for a sweeping program to repair the system’s inefficient workings. The strategy includes installation of a clearer administrative authority, tougher performance standards for lagging courthouses and employees, and a more disciplined budget process.

The recommendations all indicate that inefficiency is the problem, but to suggest that this stems from the different methods of doing business from district to district might be a mistake, said attorney Nancy Frankel Pelletier, a partner and member of the Executive Committee with Robinson Donovan, P.C. in Springfield.

"There is generally complete inconsistency in terms of how the courts are managed, and that’s at all levels. Each county essentially handles its business differently," Pelletier said. "Obviously, some people at the top feel that doesn’t make any sense.

"However," she continued, "frankly, I’ve found over the years that the courts that are the most autonomous do business more efficiently that those governed from on high. Inconsistency might not be a negative thing."

What is hurting the system, she and other lawyers assert, is a badly funded system that leaves courts hurting for key personnel and backs up the process for plaintiffs and defendants who deserve prompt service. But that’s an old story, and it’s not one that’s bound to improve as Romney seeks to make statewide cuts in order to close a $3 billion state budget shortfall.

The Visiting Committee’s report isn’t the first of its kind, legal experts say, and it won’t be the last. And addressing its sweeping proposals might be a losing proposition without the funds to back up the effort. If the courts are indeed drowning in inefficiency, they tell BusinessWest, this report may be a cry for help, but, under the current economic circumstances, it isn’t exactly a life preserver.

Serious Indictment

The report does aim to be just that, however, by aggressively detailing a number of problems plaguing the courts and outlining possible solutions. Chaired by J. Donald Monan, chancellor of Boston College, the committee recognized "pockets of excellence" in the system, but said that, for the most part, constituents are not getting the justice they deserve because of inefficiency and slow case resolution.

"Today, the courts of Massachusetts are mired in managerial confusion," the report says. "The impact of high-quality judicial decisions is undermined by high cost, slow action, and poor service to the community."

That managerial chaos means court personnel and managers don’t know where to turn for guidance, while reporting lines are vague at best, the report asserts, adding that the situation could be remedied by increasing management experience in the Judiciary administration. That concept met with mixed reviews locally.

According to Paul Rothschild, a partner with Bacon & Wilson P.C. in Springfield who specializes in civil litigation, studies have shown that placing management of the court system in the hands of judges has not worked.

"The Judiciary is not the appropriate party and is not trained and capable of managing the system," Rothschild said. "It should be run by managers with some type of management experience. The system is in disarray, and it needs some type of professional management and some clear financial support from the Legislature and the governor to put it together. The goal is to find the most efficient, effective way of running the courts, and we clearly don’t have that now."

However, Pelletier said, it’s difficult for managers to have a full understanding of the system without legal expertise. "There are those, and Gov. Romney might be one of them, who think we need a professional manager, not a judge or lawyer, to manage judges and lawyers," she said. "But I don’t think that will work because, to properly manage the system, I think you have to have a complete understanding of how justice is administered from within."

The panel also took the judicial system to task for how inefficiently resources are allocated. The committee recommended that budget and staffing requests and allocations be made on demonstrated needs, not history, and that the budget request process be redesigned so that resources are directed to courthouses in need, among other changes.

That could be good news for Springfield’s court officials, who have long complained that funding for Hampden County has been disproportionately low compared to what courts in Eastern Mass. receive.

"This has been an ongoing problem," Rothschild said. "The Springfield District Court is the busiest court in the state, especially by virtue of criminal case load, and it was considerably underfunded compared to those in the Boston area."

The Jury Is Out

But the question of efficient allocation of resources has come up in several recent studies, he added, none of which explicitly addresses the problem Springfield faces.

For instance, Romney has proposed merging the Boston Municipal Court, which acts as its own entity, into the district court system and closing a number of district courts, eliminating some duplication in administrative staffs. Meanwhile, the Legislature has come up with its own proposal that would expand the scope of the Boston Municipal Court to encompass several other municipal courts around Boston, also removing some duplication of duties while evening off the money spent in various districts.

But if the funding disparity doesn’t directly address Springfield, area law experts say, the city will see more problems such as what emerged last year when a funding shortage forced a decrease in the number of court stenographers. While criminal cases got priority, attorneys saw a major logjam develop on the civil side.

Sam Stonefield, an attorney and professor of Law at the Western New England College School of Law, said the funding disparity in Western Mass. courts has reached crisis levels, but, as the flurry of recent studies and reports have shown, there isn’t sufficient consensus to address the issue.

"If you look at budget allocation, there’s clearly no agreement. When you look at performance guidelines, there’s no agreement. And in the hiring and supervision of employees, there’s no agreement in the three branches of government or within the Judiciary itself," Stonefield said. "I think that undermines the performance of the court system and ultimately undermines its ability to deliver justice to its citizens."

Meanwhile, Rothschild said, every cutback affects Western Mass. courts more than it does those closer to Boston, and that affects morale since clerks and other employees don’t know if their jobs are safe. At the same time, cases move more slowly, and justice grinds to a crawl.

In addressing what he considers the top two issues facing the courts, funding and budget allocation "the allocation of resources is indefensible," he said Stonefield hopes the Visiting Committee’s report can serve as a template to try to bring together some of the disparate voices calling for change.

But he said there must be a framework for judging the performance of the courts before there can be meaningful change in how those courts are funded. It’s a similar situation to that of education, which developed the framework of the MCAS exam to better understand how resources should be channeled.

"That’s a hard thing to do," he said, "but, in today’s climate, no one can simply say, ’we need more money’ without saying what the money is going to be used for."

In that, he agrees with the panel’s emphasis on high performance and accountability in its report. The committee wants to establish goals with benchmarks and measurements, including a standard cost per case handled, customer service studies, and complaint tracking. It also wants to create detailed job descriptions; measure managers and employees by efficiency, courtesy, and timing; establish employee and management reviews; create consequences for poor performance; and publish court rankings.

"Not one court is able to point to clearly defined benchmarks by which it measures itself on decision-making quality, efficiency, timeliness, and service," the report states. "There are almost no definitions of what a good job or a bad job looks like."

Courting Change

After visiting 14 courthouses, interviewing 165 court and community officials, and presenting a hefty set of recommendations, the Visiting Committee recognizes that reaching some kind of consensus among the three branches of government is paramount to bringing about any change.

"The committee realizes that the key to our recommendations will lie in their implementation," Monan said. "Our recommendations can only be implemented through the cooperative action of the judicial, legislative, and executive branches."

Mitchell, who commissioned the report, said she will review it with other Supreme Judicial Court justices in the coming weeks, while consulting with legislative leaders and pushing for implementation of managerial change as soon as possible.

For its part, the Mass. Bar Assoc. welcomed the report, while appointing its own task force to conduct Court Study 2003, a similar examination of the state’s judicial workings.

"We believe that, taken together, these reports will present the most complete assessment of our courts today and provide the most fair recommendations for the future," said Joseph P. J. Vrabel, MBA president.

Pelletier reminded BusinessWest, however, that positive steps have already been taken to improve efficiency in some areas. For example, district courts had traditionally tried civil cases involving less than $25,000 before a judge, but a losing plaintiff could then exercise his rights to a jury trial, doubling the resources and time needed to handle that case. To respond to that wastefulness, a program was instituted giving plaintiffs a six-member jury to begin with, immediately cutting down on long-term court costs.

"I think there have been some great strides made recently at the state level," Pelletier said, while recognizing the need to tackle larger budget issues. She worries, however, about how much can actually be done considering the state’s current budget crisis. "I’m sure the executive branch has been looking at these issues, but, unfortunately, the economics of the situation may cause it to go nowhere."

"There is an awful lot of waste, an awful lot of duplication," Rothschild said. "I don’t know how you get around it. You can’t turn government into a private business, but you can probably treat it more like a business than we do."

For his part, Stonefield said he agrees 100% with the panel’s assessment of the Judiciary’s problems. Even considering the challenge of creating consensus that now faces the state’s lawmakers, he called it a positive start. "Hopefully, out of this crisis will come a framework for a long-term commitment."

’Long-term’ might be the best choice of words to describe the mere process of enacting change. The job ahead is a daunting one, to be sure, but lawmakers and court officials may have the most detailed blueprint yet to begin restoring order in the courts.

Remaking Easthampton

By BusinessWest Staff May 1, 2003

Easthampton is finally shedding its old mill-town identity in exchange for a new image and commercial dynamic, a hybrid of grit and glitz, with strong hometown flavors. The change has been a long time coming and is the result of a variety of factors, including an emerging arts community, a reinvented government, strong and community-minded business leadership, and real estate assets ranging from recycled factory buildings to picturesque millponds reflecting the stunning escarpment of Mt. Tom.

Twenty-five years ago, local boosters were talking up Easthampton as a diamond in the rough poised for a renaissance like its neighbor, Northampton.

It turns out they were a couple of decades ahead of themselves.

The local business news in the late 1970s and early 1980s had mainly to do with factory closings and layoffs and halting attempts to spruce up a crumbling downtown. Still, to give the enthusiasts credit, they had, even then, some grounds for optimism.

The vast, previously abandoned factory complex on Cottage Street in the heart of the town, facing onto Nashawannuck Pond — Easthampton’s scenic crown jewel — had been taken over by Riverside Industries Inc., a non-profit agency serving the developmentally disabled. With prescient entrepreneurial spirit and skill, Riverside was rapidly bringing the building back to productive life with a vibrant, unique mixture of enterprises: its own collection of offices and program space and piecework assembly workshops, plus chunks of cavernous space it rented out to independent craftspeople who were converting the raw real estate into studios and workshops.

So the seeds of change had been sown. But that change was slow to catch on. The blossoming of One Cottage Street for years seemed to be a kind of hothouse phenomenon, little noticed outside the building; just this year Riverside has hired a community development director to actively promote itself. It wouldn’t be until the turn of the millennium that Easthampton convincingly started to turn the corner.

As late as the mid-’90s, the downtown’s four main commercial streets had a combined 30% vacancy rate, while a million square feet of traditional, red-brick industrial space was going begging, according to city planner Stuart B. Beckley, who arrived on the scene in 1989.

That was the nadir. The trend since has been one of dramatic recovery. The numbers have caught up with the hopeful rhetoric. Today, the downtown retail vacancy rate is down to 5%, and more than a half-million square feet of formerly vacant factory space has either been converted to business and residential use or is being actively developed, according to Beckley.

New independent shops, galleries, restaurants, and entertainment venues have cropped up on Cottage and Union streets. Existing, family-owned retail enterprises like Manchester’s Hardware and Village Pizza on Union Street have undertaken major downtown building projects. Manchester’s has just torn down a derelict furniture store and built a new addition in its stead to house a new equipment-leasing division. The city’s surviving manufacturing enterprises, concentrated now in modern, single-story plants in the outlying industrial areas, seem to be thriving, and, in the case of Tubed Products, the October Co., and Liebmann Optical Co., among others, investing in new or improved facilities is paying off.

BusinessWest looks this month at the remaking of Easthampton, and what the future holds for this community on the other side of the mountain.

A Work of Art

Unquestionably the single most important development in the town since One Cottage Street, which served as its original inspiration, has been the continuing transformation of the massive former Stanhome factory on Pleasant Street into a multi-use commercial and residential ’community’ called Eastworks (see related story, page 22). Eastworks has brought an important new wave of entrepreneurs and artists into town, many to live as well as to work. They in turn have been integral to the revitalization of the downtown, becoming customers for food, services, and hardware, as well as patrons of new restaurants.

Two other projects involving high-profile properties, while far smaller in scope and general impact than Eastworks, have been just as important as symbolic affirmations of the town’s new direction, according to Mayor Michael Tautznik, who calls them "investments of hope in the future of the community."

Silas Kopf, a nationally known master of marquetry (the art of decorative wood inlay) who was among the first group of craftspeople to move into One Cottage Street, bought the former fire station at 84 Union St. for $230,000. Plowing into it multiples of that sum he doesn’t wish to reveal, he has had it completely renovated into a spacious first-floor studio and showroom/office, and second-floor apartments.

Almost simultaneous with Kopf’s undertaking, Jo Roessler and Nora Kalina, owners of Nojo Design, formerly tenants in Eastworks, bought the derelict former X-rated Majestic Theater on Cottage Street, the downtown’s most embarrassing liability, and converted it into another high-end woodworking shop and showroom.

"Silas has done a wonderful job with the fire station. It’s exactly what I wanted there, from the point of view that it’s an interested business person in the community who’s making an investment in a very vital piece of property," said Tautznik. "More important than what’s going on inside the building is what the investment means. It represents a lot of hope in the future of the town and the belief that property values will continue to increase. We continue to be impressed by people who make those kinds of investments."

As a result of the progress that’s been made, Easthampton in 2003 is finally starting to deal with "problems" that, 15 years ago, it only dreamed of having. These include congestion, insufficient downtown parking, and lack of vacant industrial space, notes Thomas W. Brown, vice president for retail banking at Easthampton Savings Bank and president of the town’s Economic and Industrial Development Commission.

"The visible proof of a revitalization in the city today is Cottage Street; if you drove through there two or three years ago, you would have found vacant storefronts and no issues with parking," he said. "I remember getting together with merchants back then, and they said, ’we’ve got a parking problem,’ and I would say, ’no, we wish we had a parking problem.’

"Well, today we do have a parking problem. It’s real. Fortunately, we have a municipal parking lot being built on Cottage Street. Try to find an empty storefront in that area today; you’d be hard-pressed."

Among the catalysts for revitalization in Easthampton cited by Brown, Tautznik, and others are:

ï the adoption of a mayor/council form of government, which has proven more efficient and more responsive than a volunteer selectboard;

ï the municipality’s success, beginning in the late ’90s after almost a decade of drought, in landing key state and federal grants targeted to economic development;

ï the strong local presence of the non-profit, Northampton-based Valley Community Development Corp., which, funded with $200,000 in grants from the city, staffs a storefront on Cottage Street providing assistance to small, startup businesses;

ï ’spillover’ from nearby Northamp-ton’s growing regional and national reputation as a magnet for young professionals and creative entrepreneurs;

ï plenty of flexible, upper-story, former factory space at an affordable price;

ï the emergence of the arts in particular, and small independent businesses in general, as an ’economic engine’ in the community; and

ï the town’s fabled hometown spirit, reflected in such organizations as an Economic and Industrial Development Commission, the Chamber of Commerce, and Cottage Street Stations (a grassroots merchants group), which have worked hard to market Easthampton, provide a variety of business services, and physically upgrade downtown commercial districts.

The community still has plenty of its rough edge left. It remains a blue-collar town and proud to be unpretentious and community-minded, says Michael Garjian, a resident, indefatigable promoter of Easthampton, and small-business director for the Valley CDC. He can count numerous new enterprises in town, including the non-profit Flywheel Arts Collective on Holyoke Street and the Pioneer Arts Center of Easthampton on Union Street, among his clients.

"Easthampton is all about community," he said. "It’s what makes this a great city. It’s a blue-collar city … the sense of community in this town is strong."

Look to the Future

That the gritty old town is giving way, nevertheless, to some kind of hybrid of the old and the new is evident on Cottage Street at noontime on the first really balmy day of spring in mid-April. There hasn’t been energy and bustle like this since the heyday of the mills, oldtimers say.

The street is swarming with pedestrians, including fishermen who’ve spent the morning angling in the pond, school children who’ve been let out early for the day, and a variety of workers enjoying a lunch break. The latter include laborers who are constructing a long-awaited new municipal parking lot on Cottage Street and a number of people who work at One Cottage Street.

Pedestrian traffic is good news for the shops on Cottage Street, including Carl Charrette’s Sunrise Pastry Shop at 42 Cottage St. and, two doors down — just opened in April — his Sunrise Sweetie’s, an old-fashioned candy shop and soda fountain.

The bake shop is full this day; customers are lined up in rows three deep at the counter to place their take-out orders for homemade soup and sandwiches. Two doors down, youngsters are streaming into Sunrise Sweetie’s. Shiny metal lids chime as the kids, scampering down the polished wooden aisles, open and peer into some of the 300 glass candy jars laid out in gleaming, inviting rows. A couple of adult customers peruse a glass case containing the chocolates that are made in the large commercial kitchens that Charrette constructed in the basement of the building. He employs 11 people among the two retail establishments and his wholesale business.

Charrette says he’s fortunate that his retail businesses are perking along just when his wholesale trade, due to the sluggish general economy, has fallen off steeply.

He acknowledges he has reason to be grateful, now more than ever, that three-plus years ago, his landlord, Mai Stoddard, "cut me a deal to get me here."

Stoddard, who is a native of Estonia, is a longtime local travel agent and Realtor who owns the building where Charrette’s shops are located, as well as being the proprietor of the Nashawannuck Gallery at 38 Cottage St., which she launched five years ago in the storefront between Charrette’s two shops.

Before Stoddard and Charrette met, he was operating his wholesale-only bakery from a rented barn on the edge of town on Park Hill. Stoddard was looking for a solid, stable business to take root on the street and be a good companion business to her own. She was tired of renting to fly-by-night tenants who "would paint the places purple, then leave town after a half a year, owing me money," as she put it. To lure Charrette, she offered to let him occupy the space at 42 Cottage St. rent-free for six months and walk away after that if he chose, with no further obligation.

This was not a case of altruism on her part, but a practical decision aimed at furthering the "revitalization of the street," and thus strengthening her real estate investment over the long haul, Stoddard explains. To get good, reliable tenants to rent upstairs, something she’d had trouble doing, she needed to have viable businesses downstairs, she told BusinessWest.

"Good business decisions don’t always translate immediately into money," Stoddard noted. Her gallery, for example, isn’t making her money, she said, but it is paying off in a larger sense, she believes, by helping to change the image of Easthamp-ton and put it on the map as a haven for artisans and craftspeople, and a destination for their customers.

As the first shop in town to carry high-end fine arts and craft objects made by the artisans next door at One Cottage Street, the gallery "tapped into a real strength of the community,’’ she said. The gallery also has served as a venue for a variety of special community events, including the annual wine-tasting party put on as a fundraiser by Cottage Street Stations at Nasha-wannuck Square, a merchants group of which she and Charrette are active members. Cottage Street Stations is focused on making physical streetscape improvements to the Cottage Street area.

Road to Recovery

It’s one of her business maxims, Stoddard says, that — whether growing a business or growing a prosperous community — "sometimes it’s more important to look good than to feel good."

These days, Easthampton is doing both.

The renaissance predicted a quarter-century ago has been unfashionably late, but it was well worth the wait.

Making a Splash

By BusinessWest Staff April 1, 2003

New England’s largest theme park has room to grow, as evidenced by this year’s major expansion of its water park. Times are good all around, the park’s general manager says, and not just for the company. Agawam is reaping greater tax revenues from Six Flags than ever before, while the park has proven to be a major asset for the region’s increasing emphasis on tourism.

Ron Sevart climbed to the top of a waterslide tower and pointed to the ground below. He then pointed in another direction, and then another.

If he was trying to demonstrate the scope of the newest project at Six Flags New England, a massive expansion of the water park, it worked. The expansion wraps around the existing water area, adding nine slides, a second wave pool, vastly expanded deck space, and a new entrance from Main Street. The end result? Twice as much room for water recreation.

"It was already the largest water park in New England," said Sevart, the park’s general manager. "Now there’s a lot more space."

When it comes to park arithmetic, however, Sevart isn’t content to stop at the doubling of the water park. He also likes to talk in multiples of 10 that is, the fact that Six Flags brings in about 10 times the tax revenues for Agawam that Riverside Park did eight years ago, an increase from about $240,000 to an anticipated $2.4 million this year.

In effect, entering its fourth year as a Six Flags park having added attractions in each of those years the facility is enjoying a better relationship with its neighbors and its town than ever before, Sevart said, and that’s crucial, given that the coming years will bring even more physical growth to New England’s largest amusement park.

Meanwhile, the tourism efforts along Springfield’s riverfront and across the Pioneer Valley offer an opportunity for the park to partner with other organizations in promoting the entire region an effort that promises to be beneficial to the individual attractions.

Six Flags is indeed making a splash one that Sevart thinks you don’t have to get wet to notice.

Water, Water Everywhere

Those who do want to get wet, however, need to look no further than Hurricane Harbor, the new name of the water park originally dubbed Island Kingdom. The new name, said Sevart, is one used throughout the Six Flags brand for water parks that reach a certain size; the only three others are in New Jersey, California, and Texas.

The expansion which cost the company around $8 million doubles the water park’s size, adding more than 10 new attractions, such as the Tornado, a funnel-shaped tube that ’flushes’ riders into the pool below, the first slide of its kind in the world.

In the center of the new wave pool is Hurricane Falls, which features six body slides, and nearby are Zooma Falls and Geronimo Falls, both of which use ’cloverleaf’ rafts in which three or four guests can ride together. Looking down at the sprawling construction from the top of an existing set of waterslides, Sevart said the park is accustomed to major changes.

"The transition from Island Kingdom to Hurricane Harbor sort of mirrors our transition from Riverside Park to Six Flags," he said. "In each case, you can see the effect of the capital investment."

Access to the water park is still free with park admission, and Sevart said the major expansion is meant to give guests something new and hopefully make them repeat customers.

"We’d like to increase attendance," he said, recognizing that wet weather in each of the past two summers has hindered those efforts to some extent. "With this facility, people can experience even more, and at the end of the day, they’ll want to come back again."

A new park entrance is being constructed at the south end, beside Hurricane Harbor, but that doesn’t mark the end of the line for physical growth. With plenty of unused land owned by Six Flags south of the existing park including parking space on the west side of Main Street that stretches to Connecticut Sevart said the company is by no means done with its expansion plans.

The question arises, of course, as to how big is too big, especially with a park that straddles a riverway. Unlike some theme parks such as the Disney parks in Florida which are built in a circular pattern, the Agawam facility is more of a straight line, requiring a longer walk to hit every attraction.

Sevart suggested that some type of people-mover ride, whether a chair lift, a train, or something similar, might be required if the park expands any more to the south. But that ride would be an attraction in itself, he added, asking, "who wouldn’t want to ride a train?"

Besides, he said, some areas of the park, particularly at each end, already form walking loops, and any design for expansion would have to take into consideration the most efficient foot-traffic pattern to save visitors time.

Speaking of saving time, the park’s Fast Lane service, a reservation system for the busiest rides, was a big success after its launch last spring, Sevart said, even though it posed an additional cost to park visitors.

"Time is more important than money for visitors at that point. Once people are here, they want to experience as much as they can without waiting in long lines," he said. "It’s about quality time with family. That’s what we’re selling, and that’s important."

Indeed, Fast Lane was an idea brought about by park visitors’ main concern, which was wasting too much time waiting in line, he added. Another addition last year, the floorless roller coaster Batman: the Dark Knight, alleviated the line issue even more by giving the park another marquee attraction to siphon people away from other long-wait rides, like the hugely popular Superman: Ride of Steel.

In fact, wait times and park traffic in general are a key concern for any facility, which is why Six Flags tries to push visitors to midweek dates with bargain prices.

Sevart said he knows of people with season passes which don’t cost much more than the price of one admission who arrive first thing in the morning, ride Superman once or twice, and leave. Others like to show up on the spur of the moment after a rainstorm.

"If I didn’t work for the park," he laughed, "I’d get a season pass and come when it isn’t busy."

Hot Property

But weekend attendance and ticket sales in general have been steadily on the rise, he said, which is why the Six Flags corporation continues to invest capital in the New England park, which it sees as a growth property, between its popularity and its expansion possibilities. The $8 million water park project comes on the heels of another $8 million in new attractions in 2002, and more than $50 million in the past four years.

"We’re seen as a park that’s experiencing growth, and we’re fortunate to be part of a company that invests in parks that are successful," Sevart said. "We’re competing on an ongoing basis with the other parks for capital investment."

And the park is succeeding even when measured against Six Flags parks in warmer climes that are able to stay open more than six months a year. However, Sevart said, it’s not a huge disadvantage because the high season of most amusement parks corresponds to summer vacation for students, which is why Six Flags parks are typically open only on weekends until school lets out in June.

A more important consideration in Western Mass. is how the park complements and in some ways spearheads a developing tourism industry in the region, characterized by a number of driving destinations, from the new Basketball Hall of Fame in Springfield to Yankee Candle in South Deerfield.

Park management sees an opportunity in those attractions, not competition. That’s why Six Flags has teamed up with the Hall of Fame on marketing materials that promote educational programs at each facility, such as a student ’physics day’ at Six Flags. Sevart is aware of how hotels, such as the successful new Hilton Garden Inn bordering the Hall, are doing, and he’s encouraged.

"The attractions are working together," Sevart said. "We know what’s going on in each other’s business."

The town of Agawam is certainly aware of Six Flags’ business side, he added, considering that the tax revenue has exploded in the past decade, which helps to keep down residential taxes. In addition, the park pays for the town’s police and fire services itself this on top of a recent $9 million investment in parking and development of a workable traffic plan.

Meanwhile, Sevart talks to the facility’s immediate Main Street neighbors a few times a year and sends them newsletters to keep them apprised of new developments a necessary part of life when running such a sprawling operation 145 days a year. "I’m finding that it’s the best relationship we’ve ever had with the town," he said.

Exciting Ride

That relationship will be a plus as the park looks to further expansion. It has been open about those plans and aggressive so far in bringing something new to the banks of the Connecticut River.

From his office, Sevart can look directly down on the front corridor of the park, which stretches from the front gate and the classic carousel past the old Thunderbolt roller coaster, now one of eight coasters on the grounds.

Because of those attractions and others, that pathway certainly retains some of the old-style feel of Riverside Park. But now, there’s something new being added every year, and the success of those ventures can be measured simply with a look out the window. "I can tell what kind of day we’re having by how crowded that walkway is," Sevart said.

Similarly, he can tell what kind of year it’s been by what the Six Flags corporation has in the pipeline. And by all accounts, the old amusement park on the riverside in Agawam still has plenty of growing to do.

Fueling the Region’s Economy

By BusinessWest Staff April 1, 2003

An economic impact report on the Technology Park at Springfield Technical Community College reveals that the facility has generated more than 2,000 jobs, directly and indirectly. The report’s author says, however, that the real return on the significant investments made in the park will come perhaps 10 or 20 years from now, when its various job-creation initiatives bear fruit across the Valley.

John Mullin calls it the "Silicon Valley effect."

That’s a term that some of those studying the nation’s technology sector use to describe the free exchange of ideas, or "cross-pollination," as Mullin described it, that goes on when technology professionals work in the same office complex or even the same community. That exchange helps generate new breakthroughs and, therefore, growth within that technology cluster or so the theory goes, he explained.

This phenomenon, as hard to quantify as it might be, is just one of the tangible and intangible economic benefits that have resulted from the creation of the Technology Park at Springfield Technical Community College, said Mullin, director of the Center for Economic Development at UMass and one of the authors of a new report on the park’s economic impact on the region.

While the Silicon Valley effect may be hard to measure, most other benefits from the creation of the park are not, he said, noting that the facility has created 860 jobs in direct employment (a number that was higher when the tech sector was healthier) and another 1,223 jobs generated indirectly. Meanwhile, the 18 companies in the park have a total payroll of $22.5 million and annual purchases of $17 million.

The economic impact study was commissioned by Appleton Corp., the company that manages the park, to gauge the contributions the facility has made to the local economy, said Mullin. When put on the drawing board, the park was envisioned as an economic engine that would put valuable industrial real estate back on the tax rolls and facilitate growth of the technology sector. The report has concluded that those goals have been met or exceeded.

"I think that this is a great success story, not because the college quickly filled the park or because they immediately had a return on investment," he explained, "but because they put a major industrial/office facility to a highly imaginative and productive use, and made the thing work.

"The real return on this is not today or in five years; it’s going to be in 10 years or 20," he continued, referring to the park’s many programs aimed at job creation, including the Springfield Enterprise Center.

STCC President Andrew Scibelli agreed, but he said there may be more good news coming out of the park in the next few months. There is one vacant building remaining in the complex, and it may soon become the focus of efforts to grow the biomanufacturing sector in this region.

He said that intiative, still in its formative stage, would, like other components of the tech park, create synergies with programs at the college. Such relationships are perhaps the most important aspect of the facility, he said.

"We didn’t want to be just a landlord," Scibelli said at a press conference to announce the report’s findings. "We’ve had hundreds of students who have affiliated with companies across the street."

BusinessWest looks this month at the grades the tech park earned on its first report card, and what might happen next at the award-winning facility.

Crunching the Numbers

Mullin said that maybe the best thing about the attractive statistics compiled on the tech park (see box, below) is that they were tallied during what he called the "rock bottom" of the current economic slowdown.

Indeed, the direct employment figure of 860 is well below the high-water mark at the tech park of more than 1,000 jobs, recorded when the tech sector was much healthier, he said. Meanwhile, the number of indirect jobs created by the park a figure derived using a standard multiplier that assumes that each job in the park creates an additional 1.4 jobs in the community has also been higher.

Mullin, who has studied a number of old mill complexes in the Northeast that have been converted into tech centers, said most companies in that sector have seen employment dip 20% to 25% over the past few years, a number that is consistent with what he found at the STCC facility. Many of those companies are now poised to grow.

Thus, the already impressive numbers could look better in the years ahead, he said, adding that, while the quantity of jobs is an important statistic, the quality is also of note.

He said it is likely that the Digital complex, which had been largely vacant since the company moved out in June 1993, would have been converted to warehouse use if the technology park had not been created with the help of state and federal funding. And warehouse positions would pay considerably less than the manufacturing and management jobs that currently exist in the facility, he noted.

While the technology park has not replaced all the jobs that existed in that location when Digital was at its height, Mullin explained, the more reasonable yardstick when gauging economic impact is what the next probable use of the complex would have been. In that respect, the tech park has become an asset for that area of Springfield and the region as a whole.

Its benefits take a number of forms, said Mullin, adding that while it is reasonable to assume that some of the tenants in the park would have located in other office buildings and manufacturing complexes around the region if the facility had not been created, the combination of attractive lease rates (well below area Class A rates), the resources of the college across the street, and synergies created by having tech companies clustered together made Springfield more attractive to some companies.

"I don’t think there’s any doubt that the technology park made the Springfield market more attractive to some people," he said. "I think this project definitely helped to grow the tech cluster in this area."

Down to a Science

Looking to the future, the college is now training its sights on another emerging sector of the economy biotechnology and, more specifically, what is now known as biomanufacturing.

As Scibelli explained, companies that are creating new pharmaceuticals and medical devices need trained employees to produce those products. The remaining undeveloped building in the tech park, known as 103B, could be targeted for existing and startup biotechnology companies that would benefit from the college’s associate’s degree program in biotechnology and the students that graduate from it.

Such a program, Scibelli said, would complement the Baystate Medical Center-University of Massachusetts-Amherst Biomedical Research Institute by providing both the physical space and the workforce needed for companies that will be spun off by that initiative.

Meanwhile, another component of the tech park, the Springfield Enterprise Center (SEC), is creating new jobs by fostering entrepreneurship. The center includes a small business incubator, which has already graduated several tenants that have relocated to other sites in the Valley. It also has a student incubator and houses the college’s Entrepreneurial Institute, which includes programs for area elementary and secondary school students, as well as a college degree program.

The SEC model has become so successful that the college is now attempting to sell it in both a figurative and literal sense to community colleges across the country.

To that end, the school has formed the National Assoc. for Community College Entrepreneurship (NACCE) and has scheduled a conference for this October to introduce other colleges to the STCC model and educate them on how to emulate it, said Scibelli.

The various educational and job-creation programs at the tech park have earned it several honors. These include the U.S. Department of Commerce’s 2001 Excellence in Urban or Suburban Economic Development Award, as well as the International Economic Development Council’s 2002 Excellence in Economic Development Award.

More important than the awards, said Scibelli, are the jobs the park has created and the promise of more employment opportunities down the road. "When we first conceived the Technology Park, we did so with the firm belief that it would become a source of jobs and act as fuel for the region’s economic engine," Scibelli said. "The economic impact report quantifies what we already knew that this tech park has become one of the cornerstones of regional economic development."

Technically Speaking

Mullin told BusinessWest that he was not immediately sold on the concept of the Silicon Valley effect. "Let’s just say I needed some convincing," he said, adding that he got it when he listened to a report on how the phenomenon has impacted the growth of the Route 128 corridor in the eastern part of state.

He didn’t need any convincing on the impact of the tech park, however. He said the numbers and the programs behind those statistics speak for themselves.

And the best news is that they will only get better.

Albano’s Legacy At Stake

By BusinessWest Staff April 1, 2003