BusinessWest

The Class of 2012

Two of the individuals are cousins, continuing and expanding D’Amour family traditions of business excellence, service to the community, and philanthropy. Another is the president of a community college hailed for his efforts to create ‘pathways’ to his institution and then from it, to four-year colleges and career opportunities. Still another has forged a reputation for getting things done, especially in the realms of adult literacy and creating permanent solutions to the problem of homelessness. Meanwhile, a husband-and-wife team, majors in the Salvation Army, have been lauded for their work with disasters — large ones, like the tornadoes that touched down last June, and the personal ones involving individuals who come to their door every day. Finally, there is an organization celebrated for the many ‘investments’ it is making in women and girls across this region. These are the Difference Makers for 2012, and while their contributions vary, they have all enhanced quality of life in Western Massachusetts.
• Donald and Charlie D’Amour, Chairman/CEO and President/COO, respectively, Big Y Foods
• William Messner, President, Holyoke Community College
• Majors Tom and Linda-Jo Perks, Officers, the Springfield Corps of the Salvation Army
• Bob Schwarz, Executive Vice President, Peter Pan Bus Lines
• The Women’s Fund of Western Massachusetts (represented by Shonda Pettiford, chair of the Board of Directors, left, and Carla Oleska, CEO)

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Donald and Charlie D’Amour

Chairman/CEO and President/COO, Big Y Foods Inc.

It’s called the Y-AIM Program.
The A stands for ‘achieve academically.’ The I, ‘inspire to attend college,’ and the M, ‘move toward personal, family, and community advancement.’
The Y? Well, that’s there for two of the main drivers in this ambitious initiative, the YMCA of Greater Springfield and the 75-year-old local grocery chain Big Y, which provided financial and logistical support to help get it off the ground, and remains a strong supporter.
In a nutshell, the program, which started with Springfield Sci-Tech High School and has recently been expanded to two more schools, places youth advocates in those facilities to help young people stay connected, engaged, motivated, and productive. And the first-year results were stunning.
In a school system where the dropout rate is just under 50%, 38 of the 39 seniors who participated in the initiative’s pilot program graduated, 36 applied to college, and all of them were accepted; two more entered the military.
“And these were at-risk kids,” said Charlie D’Amour, president and COO of Big Y. “This was not a selected pool of kids who would do well anywhere; they were clearly at risk of dropping out and not finishing high school.”
Participation in the Y-AIM program is just one of myriad reasons why D’Amour and his cousin Donald (chairman and CEO), the sons of Big Y founders Gerry and Paul D’Amour, respectively, have been chosen as Difference Makers for 2012. The two have long records of success in business, community service, and philanthropy, and perhaps the best thing they’ve done is involve other executives at Big Y, rank-and-file employees, and customers in many of the initiatives, a point they reiterated many times.
Here is just a partial list of those reasons:
• Company growth. Under their joint leadership, which unofficially began in the late ’80s (the transfer of power was a fluid process), Donald and Charlie D’Amour have more than doubled the size of the family business, with total sales now above $1.5 billion, and a projected annual economic impact (payroll and spending at local businesses) of $375 million.
• Employment in Big Y food and liquor stores in Massachusetts and Connecticut, which now totals more than 10,000. Meanwhile, over the years, the company has provided several thousand people with their first job, a fact the two cousins say they are seemingly reminded of every day.
• Community service to area organizations and institutions. While there are many lines on both résumés, Donald is perhaps best known for his work with the Springfield Library & Museums. In fact, one of the facilities is now known as the Michele & Donald D’Amour Fine Arts Museum in recognition of their many contributions of time, money, and inspiration. Charlie, meanwhile, is most known for his long service to Baystate Health; he’s been on the board of directors for many years, and was president in 2009 when the critical decision was made to move forward with the $296 million Hospital of the Future project, despite the fact that the economy was in free fall.
• Many contributions in the broad realm of education, from Y-AIM to a scholarship program that has awarded more than $3 million to date, to the Homework Helpline, a one-on-one homework-assistance service for students in kindergarten through grade 12.
• Donations of food by the Big Y corporation to area food pantries that average an estimated $5 million annually.
• Contributions in health care, perhaps the most notable being a financial donation that put the D’Amour name over Baystate Health’s cancer center.
• Fund-raising efforts staged at Big Y stores to benefit the victims of disasters ranging from the tornado in Springfield to the earthquake in Haiti, to the tsunami in Japan.
• An annual giving campaign involving employees which now raises in excess of $350,000, with all proceeds spent locally.
• The BEST (Big Y Employees Sharing Time) program, through which employees of specific stores donate time to the host community for initiatives ranging from park cleanup to service at a local shelter.
On the occasion of their being selected as Difference Makers for 2012, BusinessWest conducted a lengthy phone interview with the two cousins (Donald now winters in Florida), which was laced with good-natured barbs between the two, who grew up delivering watermelons together for the business their fathers were then taking to the next level.
Consider this exchange:
While noting that his time spent on endeavors within the community has escalated over the years, Charlie said, “people say I’m pretty good at what I do here at Big Y; they joke that maybe I should try doing it full-time.” To which Don remarked, “they’re not joking.”
But the two were much more serious when talking about that lengthy list of reasons why they’ll be honored at the Log Cabin on March 22. Indeed, when asked about the motivations for their work with area institutions and within the broad realm of philanthropy, Charlie said, “we look for things that can have an impact.”
“We’re focused on health, education, and hunger, because we’re in the food business,” he continued. “We look for programs that are going to be meaningful in the community and that will have direct impact.”
Don concurred, noting that, in many respects, he and Charlie are continuing and escalating a tradition of giving back started by their fathers.
“They set the tone for us,” Donald said of his father and uncle. “They were always doing things in the community — and they were very busy, too; they worked around the clock. I’m not saying that we don’t work hard, but Gerry would work at home on Sundays doing the ads, and those two were always on the phone talking to one another.
“They didn’t have a lot of leisure time,” he continued. “But they somehow found the time to get involved in the community. They sat on local community boards, be it chambers of commerce, hospitals, or colleges, and were always in a philanthropic mode. They set a very good precedent for us.”
Don noted that his paternal grandmother was a schoolteacher, and she impressed upon his father and uncle the importance of education, a philanthropic attitude that has manifested itself in many ways, from donations of time and money by the first generation to Western New England University, where the library now bears the names of Big Y’s founders, to the Homework Helpline.
The Y-AIM program is the latest example of this focus on education, and the results speak for themselves, said Charlie.
“There is so much being thrown at the Springfield schools to try to move that needle and improve graduation rates and improve college matriculation rates,” he said. “And they’re nowhere near as successful in terms of getting results as this one, and I think it’s because of its comprehensive nature with youth advocates in the schools working directly with these young people.”
There is a work component to the program, said Don, noting that many participants land jobs with Big Y, and for most of them, it’s their first work experience. Providing such opportunities is a responsibility all those at the company take very seriously, he noted.
Charlie agreed. “We have to teach these young people how to dress, work with the public, read a schedule, and what to do with a paycheck,” he explained. “It’s very gratifying to see that sense of empowerment that these kids feel when they earn their first paycheck and it’s their money.”
For providing a path to those first paychecks — and for the many other reasons listed (and not listed) above, Donald and Charlie D’Amour, and all those in the Big Y family involved in their efforts, are truly Difference Makers.

— George O’Brien

William Messner

President, Holyoke Community College
As he talked about Holyoke Community College, what has transpired since he arrived there in 2004, and what he envisions moving forward, Bill Messner dropped the name Ruben Sepulveda early and quite often.
And with good reason.
Sepulveda is now in what amounts to his junior year at Amherst College, studying Psychology. This is worlds — and even dreams — removed from the existence he knew after dropping out of high school in New York and spending considerable time homeless or living in the boiler room of the pool hall where he used to hustle to put a few dollars in his pocket.
His fortunes changed in a huge way not long after relocating to Holyoke and, more specifically, a chance encounter with HCC Adult Learning Center (ALC) Director Aliza Ansell in the gas station across the street from CareerPoint, where the ALC program was then housed. Fast-forwarding a little, Ansell convinced Sepulveda to take a college placement test. He scored well and eventually enrolled in HCC, majoring in Psychology. His bigger goal was to transfer to a four-year institution, and after a tutoring session with a student at Amherst College, he knew that’s where he wanted to land; he even carried a business card with the school’s name and logo on it in his wallet, looking at it often to inspire him.
“I realized I had to see the dream to make it a reality,” he told a writer for an HCC publication not long after becoming the first HCC student to transfer to Amherst in decades.
Sepulveda’s compelling journey goes a long way toward explaining why Messner, HCC’s third president, has been named a Difference Maker for 2012. It doesn’t tell the whole story, but it hits on the overriding theme of Messner’s tenure — creating opportunities, or what he calls “pathways.”
And that work started virtually the day he arrived on the Homestead Avenue campus. Actually, it goes back further, to one of his interviews for the job, when he asked, in essence, why did a community-college campus in a city that was 41% Latino have a mere 14% of its students from that demographic?
After taking over, he went about leading efforts to do something about those numbers. Indeed, Messner has made increasing enrollment and strengthening college relationships with the Latino community one of his top priorities. During his tenure, the number of Latino students has increased 67%, and they now make up 20% of the student body, a number that is continually rising.
Such improvement stemmed from a recognized need to change the direction the school had taken for what was then more than a half-century, he said, adding that general agreement on what needed to be done made it that much easier to move forward as a campus.
“The world had changed over the course of the 50 years of the school’s history, and I think many individuals agreed that the next step in the institution’s evolution was that we had to make it more accessible to the changing population of Western Mass.,” he explained. “We had to open the doors, get off campus, and become more involved in the community than we had heretofore.”
Achieving progress in this evolutionary process is one of many accomplishments Messner can cite since his arrival, and they all contribute to his designation as a Difference Maker. Others, which in some way contribute to the big picture, include:
• The opening of the Kittredge Center for Business & Workforce Development and the emergence of that facility as one of the region’s key resources for workforce training, professional development, and personal growth, through a number of innovative programs.
• Success in the long and challenging fight to create the Picknelly Adult & Family Education Center in the old downtown fire station in Holyoke. The PAFEC is a collaboration between HCC and its partners in the Juntos Collaborative, and it provides GED preparation and testing, adult basic education, workforce-development classes, English for speakers of other languages (ESOL), tutoring, mentoring, career counseling, and other services.
• Training and Workforce Options (TWO), a unique collaboration between HCC and Springfield Technical Community College established to support the workforce-training needs of the region’s businesses and nonprofits.
• Planned expansion of the campus through the pending acquisition of the former Grynn & Barrett photo studio and converting it into a health sciences building.
• Expansion of what are known as Holyoke Community College School District Partnerships. Over the past several years, HCC has significantly grown its partnerships with area school systems in ongoing efforts to meet community needs and make the college more accessible. In particular, the college has worked closely with both Holyoke and Springfield to help them deal with the challenges of enhancing student success. Overall, HCC has two dozen public-school outreach initiatives throughout the Pioneer Valley, such as the Gateway to College program, which brings at-risk high-school students to the campus from Agawam, Holyoke, Longmeadow, Ludlow, Palmer, and Springfield.
Through these efforts and others, Messner has advanced his primary mission of creating those pathways he described, while also putting greater emphasis on the middle word in the college’s name — ‘community’ — through programs, policies, and, in Messner’s own case, leading by doing.
Indeed, he has become involved with a number of organizations and initiatives, including Wistariahurst, the United Way of Pioneer Valley, the Economic Development Council of Western Mass., the Pioneer Valley Planning Commission, the Holyoke Chamber of Commerce, Holyoke Medical Center, the Holyoke Innovation District Task Force, and others.
“I’ve spent a good deal of my time off campus involved in a variety of community endeavors, as one way of demonstrating what this institution should be all about,” he said. “Another way of doing that, beyond the president getting off campus, is the institution getting off campus. The transportation center is perhaps the most visible example of that, but so is the Ludlow Adult Learning Center, which serves a large immigrant population there. And the Kittredge Center, even though it’s on campus, is another example.
“It’s another visible manifestation of the fact that we’re here to serve the community, not just in the traditional sense that we have for 50-some-odd years,” he continued, “but in an array of ways, such as seminars, workshops, meetings, and more.”
Looking back on these efforts — and ahead to what must come next — Messner came back to those two words access and pathways, and again summoned the name Ruben Sepulveda. He’s only one of many who have been impacted by the school’s heightened focus on access and community, but he exemplifies many campus-wide strategic initiatives.
These include everything from strengthening ties to the Five Colleges, including Amherst — Messner went so far as to say that one of his unofficial goals is to change that phrase to ‘Six Colleges,’ with HCC joining the club — to bringing the demographic mix of the college more in line with the communities it serves.
And as he goes about that work, he can find some affirmation in some words Sepulveda penned in an essay at HCC years ago:
“Contrary to what most people think about underprivileged people — those with substandard education, those who are part of the cycle of mediocrity, those people we see on the bus, or dragging baby carriages with babies in tow, or just released from prison — they are not empty inside,” he wrote. “They are not content with the lives they have. They want more; they dream of more.”
For helping to carve the pathways to more, Bill Messner is truly a Difference Maker.

— George O’Brien

Majors Tom and Linda-Jo Perks

Officers, the Springfield Corps of the Salvation Army

Tom and Linda-Jo Perks were hardly novices when it came to disaster response last June 1, when tornadoes plowed through several communities in Western Mass.
Indeed, Tom, commanding officer of the Salvation Army’s Springfield Corps, was in Lower Manhattan only a few days after 9/11, working to provide relief to the survivors of the terrorist attacks. And his wife, Linda-Jo Perks, co-commanding officer, was in Biloxi, Miss. just after Hurricane Katrina barreled through in 2005, doing similar work.
But both told BusinessWest that there was a dissimilar feel to the relief efforts in Springfield after the twister changed thousands of lives in a matter of seconds that fateful Wednesday afternoon, a phenomenon Linda-Jo summed up quickly and effectively when she said, “it’s different when it’s your disaster.
“We were used to people telling us what to do, and we’d respond,” she continued. “But when it’s your disaster, you’re in charge, and the next morning, we just knew that the people who were isolated needed food and care — and we moved.”
Elaborating, Tom said there was a far-greater personal connection to the human side of the devastation, because responders knew some of the people who were impacted, as well as that much greater sense of ownership of the relief efforts. This sensation would, unfortunately, be repeated a few months later when a hurricane swept across Western Mass., and again in October, when a freak snowstorm cut off power to hundreds of thousands of people.
Effective disaster response in a tumultuous 2011 is only one of many reasons why the Perkses, or “the majors,” as some call them, have become part of the latest class of Difference Makers. Most all others involve issues and problems that are with the region on a constant basis — and for which the Perkses and the team they direct have crafted results-driven responses that have stood the test of time.
There are seasonal programs such as Coats for Kids, Toys for Joy, and a summer literacy program, as well as ongoing initiatives including a family reading program, tutoring services involving students from Springfield College and area high schools, teen violence and gang-prevention efforts, food pantries, and clothing assistance.
And then, there’s a groundbreaking endeavor called Bridging the Gap.
Now 15 years old, BTG, as it’s called, was created to help teenage first-time offenders become one-time offenders and get their lives back on the right path.
It does so through a 12-week program (classes are conducted three days a week for three hours a day) focusing on life skills ranging from communication to money management; from building self-esteem to goal setting.
Those who successfully complete the program and do not commit another crime within a year of that accomplishment have their criminal records expunged, “which can have a serious impact if you’re talking about college or getting a job when you’re 15,” said Tom, noting that BTG has enjoyed an 89% success rate. It has won a prestigious honor — the National Justice Department Outstanding Youth Program of the Year Award — and is now a model for many other organizations serving young people, with an average of eight to 10 groups coming to Springfield each year to see how it works.
BTG is an example, said Tom, of how the Salvation Army earns attention and headlines for its response to tornadoes and hurricanes, but the bulk of its work is “with people who come through the door each day with their own disaster.”
Reflecting on their quarter-century of service to the Salvation Army, the Perkses noted that they took different paths to the organization. Linda-Jo said her parents were Salvation Army officers, and she essentially grew up with the institution knowing she would one day be a part of it.
Tom, meanwhile, said his route to the Springfield Corps’ Pearl Street facility was more a matter of circumstance than destiny. He was 4 years old when, to try to get along with a gang of boys in his Warren, Ohio neighborhood, he let the air out of the tires of dozens of cars before he was eventually caught in the act. He remembers the police officer who escorted him home telling his mother, “you better do something with him, or he’s going to be mine.”
“She heard that the Salvation Army was a church and that it had a boys program, and we started attending, so I grew up in the Salvation Army,” said Perks, adding that, despite this, he still wandered down the wrong path. He had become involved in drugs and alcohol and was a young man without much direction or purpose in his life when another incident provided him with both. Not long after graduating from high school, he and a good friend were in a serious automobile accident. Perks was left with a fat lip, while his friend, the driver (and the straightest-laced guy in the world), was left in a coma.
“I said, ‘this is not fair; I should be the one who’s hurt really bad, not him,’” Perks recalled. “God said it wasn’t the first time it was someone else when it should have been me, and that I needed to decide what to do with the rest of my life. I considered the Salvation Army, and when other doors closed and that one opened, I walked through it.”
The Perkses met on the first day they were in seminary, and have been together virtually every day since that moment. Their pending 25th wedding anniversary and 25th anniversary of graduating from the seminary were only a few days apart.
They started their careers with the Salvation Army in the Worcester corps, and made subsequent stops in Greenfield and Pittsfield before coming to Springfield, the third-largest corps in the state.
When asked what constitutes a typical day for them, they said there is no such thing, which is what they like most about their work.
“There’s never what I would call a normal day,” said Linda-Jo. “Each day is different; you could be counseling a runaway, giving a bus ticket to a transient, helping someone whose loved one has died and needs to get to the funeral, performing a marriage, helping a child to read … you never know what you’re going to see when you come in the door.”
This was especially true in 2011, when one weather-related disaster followed another, with many families impacted by two or even three of them.
The Perkses were at their home in Agawam when the tornado carved its path through Western Mass. It missed them, but they knew from watching on television that it didn’t miss many sections of Springfield. They couldn’t get into Springfield right away, but immediately started mobilizing the organization’s resources, staff, and volunteers for a multifaceted response.
It involved everything from bringing food directly to families in the impacted areas to getting necessities to families displaced by the disaster and living temporarily in the MassMutual Center, to coordinating collections of items ranging from bottled water to diapers.
But beyond supplies, staff and volunteers from the Salvation Army also delivered counseling, support, and, quite often, a literal shoulder to cry on.
“People were trying to clean up, and they were crying,” said Linda-Jo. “It was sad, it was hard, it was moving. People just appreciated the fact that we thought about them, and it was really neighbor helping neighbor; it was people from Cape Cod sending tractor-trailer loads of supplies to the area and a Christian school taking a trip here and saying, ‘can we help you?’”
Tom has similar memories, and summed them up by saying that perhaps the most precious commodity the Salvation Army brought to victims was hope, and that’s something that’s supplied to all those who come through the door — literally or figuratively — with their own disaster.
For providing that hope, in whatever form it takes, the majors, and all those who work with them, are certainly Difference Makers.

— George O’Brien

Bob Schwarz

Executive Vice President, Peter Pan Bus Lines
The walls and credenza in Bob Schwarz’s office are cluttered with mementos and awards from a more-than-40-year career in business and community service — and together, they tell a compelling story.
While many of the items are individual in nature, most involve the company, Peter Pan Bus Lines, for which he has worked for more than 25 years. And that’s appropriate, because most times it’s hard to separate one from the other. And more than a few items involve occupants of the White House, or occupants in the making.
First, there’s the picture from Bill Clinton’s first inaugural parade. It shows, crossing in front of the reviewing stand, the Peter Pan bus that Clinton and key members of his election team took on the first 1,000 miles of his post-convention campaign in 1992. Schwarz was one of the company’s employees who made the trip down. Meanwhile, there are a few framed, handwritten notes to Schwarz from George H.W. Bush, dating to his days as ambassador to the United Nations in the early ’70s, when the two had become acquainted. He signed them using the nickname many knew him by: ‘Augy.’
But perhaps his most treasured item is the national Community Champion Award that he received from the U.S. Interagency Council on Homelessness in 2008, for which he made another trip to Washington. And there’s a story behind this one that he likes to tell.
“I didn’t take a bus this time, and I should have,” he recalled. “My wife didn’t want me to wear my suit down, so I packed it. And of course, the airline lost my luggage — and really didn’t seem too interested in finding it. The experience gave me the opportunity to know a little about what it feels like to be in a city with nothing but the shirt on your back.”
Schwarz was eventually hooked up with a clean shirt, tie, and jacket, and received his award from then-‘homeless czar’ Philip Mangano, who praised him for his efforts as part of a nationwide program to end homelessness. Locally, Schwarz told BusinessWest, that effort was not about placing people in shelters, but instead in finding them permanent housing.
“It’s been proven that putting people in shelters does not really put a stop to their being homeless,” he explained. “It’s just a stopgap; we need more permanent solutions.”
Schwarz’s work to stem the tide of homelessness constitutes one of several reasons why he was chosen as a Difference Maker for 2012. Others include his work with the United Way, the Eastern States Exposition, the New Leadership Charter School and its library, which he helped create, and especially as chair of the Literacy Works Cabinet of the Regional Employment Board.
And as he talked about these various initiatives and his involvement with them, Schwarz said he’s been helped tremendously over the years by the very positive influence of role models in the broad realm of community service. Exposure to them came through his work with the Greater Springfield Chamber of Commerce, which he served in several capacities, from manager of Government Affairs to president.
“I was this young kid managing a chamber, and I had this incredible opportunity to work with and learn from so many great business leaders,” he said. “People like James Martin at MassMutual, Wilson Brinnell at Third National Bank, Bill Janes at S.I.S., and then later Bill Clark at MassMutual, Paul Doherty [a Springfield attorney], and David Starr [publisher of the Republican]; these individuals began to instill in me a philosophy about corporate social responsibility and the responsibility of the business community to give back.”
Perhaps the most influential of these role models, however, was the man he would later go to work for, Peter Picknelly, president of Peter Pan, who was chairman of the Greater Springfield Convention and Visitors Bureau when Schwarz started with the chamber and was later its volunteer president.
“There was no one more generous in giving to his city than Peter Picknelly,” Schwarz told BusinessWest. “Peter really believed in Springfield, and also in the responsibility to become active in community organizations; it was a way of life at Peter Pan.
“Peter told me that, if I ever decided to get a legitimate job, I should give him a call,” Schwarz continued with a laugh, noting that, a few years after that initial proposition/challenge, he took up Picknelly on his offer, joining the company in 1986.
Since then, he has become involved in a number of the transportation and real-estate-related ventures initiated by Peter Pan and its subsidiaries. This includes everything from the bus line’s decision in the late ’80s to take on archrival Greyhound by expanding its reach along the East Coast (there’s a framed Boston Globe business page story on this move hanging in his office) to the current efforts to revitalize the property in Springfield’s Court Square.
But amid his exploits in business, he has always devoted considerable time and energy to community service. And while this commitment to giving back has manifested itself in many ways, the two most notable have been his efforts to promote adult literacy and the fight against homelessness — and both were in many ways inspired by Picknelly.
Recalling his work with literacy efforts, Schwarz said they really started when Bill Ward, whom he hired to manage what was known many years ago as the Private Industry Council, asked him to serve on the board of what’s now called the Regional Employment Board of Hampden County. “And when you become a member of Bill’s board, you don’t just become a member; he gives you an assignment.”
And Schwarz’s was (and is) adult basic education (ABE) and English as a second language, two causes that became the focus of a project in Holyoke originally conceived by Peter Picknelly — transforming the old main fire station into a combination transportation hub and ABE center.
“It became a passion for me, and a natural when Peter Sr. decided to build the transportation center,” Schwarz recalled. “He saw this as an opportunity to do something very unique and very different, and do something that hadn’t been done before in this country, which was Peter’s style, and something that would make a real contribution.”
Meanwhile, Schwarz said his work with the homeless was in many ways inspired by views of a tent city on the route taken by the funeral procession following Picknelly’s death in 2004 — and commentary offered by Picknelly’s son, Peter.
“He said, ‘this is not the Springfield my father loved and worked all his life to build; we simply can’t have homelessness,’” Schwarz recalled, noting that he was later approached to join (and become the first chair of) then-Mayor Charles Ryan’s program to eliminate homelessness in the city, called the Housing First Initiative.
“I’ve had the chance to participate in a lot of volunteer efforts over the years, but this was one of the most challenging and interesting assignments I’d ever taken on,” Schwarz told BusinessWest. “It was a very interesting time when street and individual homelessness was on the rise, and the ULI report came out and said, ‘the city of Springfield will never reach its revitalization potential unless the issue of homelessness is dealt with.’”
Only a few years into the 10-year initiative, homelessness had been reduced by 39%, said Schwarz, adding that one of the keys to achieving such results was the creation of the Homeless Resource Center on Worthington Street, a feat he called one of the most rewarding of his life because of the economic and logistical challenges to overcome.
“The economy was lousy; this was a time when individuals were losing their jobs and businesses were cutting back,” he said. “To think that you could raise $1 million in private capital to put toward a homeless resource center is pretty remarkable. The people in Las Vegas wouldn’t have given us high odds of success, but we did it, because it was the right time and the right thing to do.”
Because of his hard work in such endeavors and track record for gaining results, Schwarz will have to make room for another item on his credenza — the plaque recognizing him as a Difference Maker for 2012.

— George O’Brien

The Women’s Fund of Western Massachusetts

Carla Oleska calls it “a full briefcase of skills.”
That’s the term she used to describe what participants in the Leadership Institute for Political and Public Impact (LIPPI) come away with beyond the certificate they’re given upon completion of the program.
Elaborating, she said LIPPI, created in 2010 by the Women’s Fund of Western Massachusetts, is a year-long program focused on providing participants ages 18 to 60 with the knowledge, skills, courage, and, perhaps most importantly, the confidence necessary to become civic leaders in their communities, impact policy on the local, state, and national levels, and seek and hold on to elected positions.
And the LIPPI program is perhaps the most visible example of how the Women’s Fund, which Oleska has served as CEO since 2006, has adjusted and modernized its mission in recent years to reflect changing times.
“In the beginning, we used to speak about addressing the needs of women and girls,” she explained, noting that, at the time (the mid-’90s), such needs included programs involving economic self-sufficiency, housing, domestic abuse, sexual abuse, education, and much more. “Today, when we look at this time period, what we say is that this fund builds better communities for everyone in Western Mass. by investing in the lives of women and girls. And there’s a real distinction there.
“When you look around today, our social needs are gargantuan,” she continued. “One of the most underutilized resources is the unique talents of women — underutilized because they are not sitting around the decision-making tables; they are not framing the conversations and addressing the problems and issues in our country. So today, we’re investing in their talents because we believe that the more women we begin including in those discussions around the table, the more women we put in leadership positions, the better off our communities will be.”
This important change in language and focus, as well as manifestations of it, such as LIPPI, are just some of many reasons why the Women’s Fund has been chosen as one of BusinessWest’s Difference Makers for 2012.
Another is the nearly $2 million in grants the fund has awarded since 1998 to groups ranging from the Hampden County Correctional Institute to the Global Women’s History Collaborative; from the Railroad Street Youth Project in Great Barrington to Girls Inc. in Holyoke.
But perhaps the biggest reason is the fund’s ability to adapt and evolve to remain relevant and impactful in a constantly changing society. Current Women’s Fund board President Shonda Pettiford calls this “being nimble and responsive,” and she considers it perhaps the fund’s most important character trait.
“Times are changing for women in our communities,” she told BusinessWest, “and we’re responding in part to their needs, but also to their aspirations and supporting those, and I can see us becoming more involved in work similar to LIPPI, where we’re focused on building leadership skills and ability.”
Tracing the history of the Women’s Fund of Western Massachusetts, Oleska said it originates with the Fourth World Conference on Women in Beijing in 1995.
More than 60 women from this region were at that conference, highlighted by a speech from Hilary Clinton, who said, “women’s rights are human rights,” noted Oleska, adding that the contingent, while on a bus ride back from touring the Great Wall and inspired by what they heard, discussed options for ways to bring the energy from the conference back to Western Mass.
Their answer was to create a Women’s Fund, a component of the Women’s Funding Network, which now boasts more than 160 members, or funds, worldwide. The local fund is now one of three in the Bay State, with the others serving the Boston area and the southeastern region of the Commonwealth.
From the start, the mission has been to “advance social-change philanthropy to create economic and social equality for women and girls in Western Mass. through grant-making and strategic initiatives,” said Oleska, adding that the fund deviated from the practice of building up its endowment before supporting any initiatives.
“As soon as the money they were raising started earning interest, that first board was determined to get money right out into the communities of the four western counties,” she recalled, adding that the fund topped $1 million in grants after only a decade in existence, and is just one round of awards away from the $2 million threshold.
Oleska, who was an early grantee (her organization, Step Forward, an academic-advancement program for girls, was awarded funds in 1998), said the organization is funded primarily by individual donations, the smallest of which has been $3 in change, a bequest she cites often as symbolic of the way the fund can take seemingly small gifts and aggregate them into something significant.
“When you take that $3 in change and you connect it with $3,000, the impact of that combined funding presents all kinds of opportunities for our grantee organizations,” she explained, adding that a $10 donation made directly to an organization usually won’t have the same impact as $10 given to the Women’s Fund, which then becomes part of a larger donation to that same organization.
But beyond the monetary donation, the grantee also receives a series of professional-development workshops, with the intent of helping them strategically achieve their mission, she continued — to help those organizations work smarter, not harder.
And this is one of the many ways in which the Women’s Fund goes well beyond merely writing checks, said Pettiford, and into the broad realm of creating connections.
“The Women’s Fund, for me, is very personal — there are many personal relationships formed because of it,” she explained. “The funds we allocate help programs run, and run more effectively.
“But we also form relationships with some of these organizations, and they get to understand the fund as well,” she continued. “Through the fund, they get opportunities to connect with others who are doing similar work. Meanwhile, those of us involved with the fund as volunteers and as staff also get to connect with all these people in different parts of Western Mass. who support the same concepts and ideas and have the same values.”
Which brings her back to that word investments and, more specifically, to the LIPPI program, which, in a nutshell, helps women overcome a tendency to underestimate their abilities.
It does so through monthly, full-day sessions (staged on Saturdays for convenience) that are designed to build both skills and confidence while exposing women of all ages to successful role models. These sessions focus on subjects ranging from public speaking to effective board participation, from how to speak with elected officials to citizen activism.
The results from the first year are impressive. Five of the participants have run for office or are doing so; one woman was elected to the board of her housing development, the first tenant to do so; one woman was accepted into the Yale Women’s Campaign School; and another worked on the campaign of Holyoke’s new mayor, Alex Morse.
Looking forward, Oleska has set the ambitious goal of reaching the $3 million mark in grants by the fund’s 15th birthday, and to continue to expand the organization’s reach into every corner of the four-county area. But the most compelling goal is simply to continue efforts to be nimble, another word she used repeatedly, and continue to make investments that are paying dividends, as reflected in this comment from a LIPPI graduate:
“Participation in the LIPPI cohort has essentially provided affirmation, inspiration, and permission to continue to follow my life’s work, to develop my voice, and work collectively with the women in Berkshire County and beyond.”
That’s what comes with a full briefcase of skills. For providing that — and doing much more for women, girls, and communities — the Women’s Fund of Western Massachusetts is truly a Difference Maker.

— George O’Brien

Photos by Denise Smith Photography
(D’Amour photo courtesy of Big Y Foods)

How Companies Are Imploring Workers to Keep Thinking

For decades — and maybe centuries — companies have had suggestion boxes in the main lobby or on the factory floor. Today, that simple process of gathering ideas from front-line employees has become exponentially more sophisticated, and beneficial. Indeed, at several area companies and one community college, idea programs with colorful names and scores of acronyms like OFI and SME have been implemented, and with tangible results.

They’re called ‘OFI boards,’ and they’re everywhere at Health New England.
OFI stands for ‘opportunities for improvement,’ and at HNE, the concept is much more than a colorful acronym; it’s a big, big part of doing business.
Indeed, OFI has become part of the lexicon and culture at the health insurance company; there’s the cartoon-like OFI logo, but also an OFI committee, OFI ‘champions,’ OFI stickers, and an OFI page on HNE’s intranet. Of course, it all starts at the boards, one for each of the company’s 30 departments, where the opportunities for improvement, or ideas, are posted, categorized, and, most importantly, tracked.
OFI has become the defining phrase, as well as the face, of HNE’s exploits in what has become known in some quarters as the ‘idea revolution,’ or the promulgation of ideas to spur continuous improvement and greater efficiency at companies large and small.
“One of the things we realized years ago was that we had a lot of bright ideas coming from our associates, but we weren’t implementing many of them,” said Joanne Walton Bicknell, HNE’s business improvement manager. “That’s where OFI comes in; it helps vet out the ideas and put them into effect. And last year we had 4,000 ideas implemented, or about 14 per associate.”

HNE put all things OFI into effect after listening to Alan Robinson, associate dean of the full-time MBA program at UMass Amherst, who wrote the book on the subject — literally. It’s called Ideas Are Free, which he co-authored with Dean Schroeder, associate dean and director of graduate programs in Management at the College of Business Management at Valparaiso University, and the two are writing the next book on this matter, too.
The working title is The Idea-driven Organization, and it’s due out in 15 months, said Robinson, adding that the follow-up will be what the first book wasn’t intended to become, but did anyway: a how-to guide.
And the basic concept behind this ideas revolution is summed up on page 63 of Ideas Are Free:
“Most people already have lots of ideas for their organizations, want to tell managers about them, and would be thrilled to have them used,” write Robinson and Schroeder. “An idea starts when someone becomes aware of a problem or opportunity. The definition of a problem is ‘a source of perplexity, distress, or vexation.’ It is something people have a natural inclination to fix. … Employees will naturally come up with a great number of ideas — whether it is to make their jobs easier or less frustrating, to stop their organizations wasting money, or simply because they see an opportunity to do something better.”
What companies need is a structured program to inspire, process, and implement ideas, said Robinson, who has consulted with businesses across the region and around the world on this subject.
At Big Y Foods, there was a program in place before Robinson spoke to company officials several years ago, said Patricia Shewchuk, who has the title ‘manager of Employee Strategies Inclusion’ on her business card. She noted that the old system was incentive-based ($100 was awarded for ideas that were implemented) and mired in logistics, complexity, and subjectivity.
It was replaced by a much simpler program known as ‘Keep Thinking’ that has inspired more than 11,000 ideas since its inception a few years ago, on subjects ranging from the location of keys on cash registers (‘clear’ and ‘total’ were way too close to one another, causing some real problems) to flavors of donuts sold in the bakery, to a suggestion to sell the garlic-butter company the chain uses on many of its baked goods. And the only rewards (aside from stickers and pens) is the satisfaction that comes with problem solving.
“It’s a very positive thing for the company,” said Shewchuk. “What we want is for people to tell their manger when they see a problem or hear complaints from customers and have a solution; we don’t want them going home and telling their family, ‘this is stupid.’ We want them to tell us.”
Robinson also helped administrators at Springfield Technical Community College establish what is still believed to be the only ideas program within the realm of higher education.
Mike Suzor, assistant to the president and point person on the initiative, said it has yielded hundreds of ideas since it was implemented just over a year ago, with an estimated net savings to the school of roughly $200,000 at a time when all public institutions are looking for ways to reduce costs, eliminate waste, and enhance revenues.
For this issue, BusinessWest takes an indepth look at the ideas movement, and why and how more companies are compelling employees to put on their thinking caps.

Chain of Events
They call it the “parking lot.”
This is the place where those involved in Big Y’s Keep Thinking program put ideas that require time, resources, and, generally speaking, more thought before being implemented, said Shewchuk.
She noted that ‘parking lot’ is just one designation that can be placed on an idea by the so-called SMEs (subject-matter experts) called upon to review suggestions and conduct the thorough follow-up procedures.
There’s also the much-sought-after ‘yes, do it’ stamp of approval, said Shewchuk, who referenced one idea — a suggestion to put items other than cases of bottled water (such as large bags of dog food) in the ‘hard-to-scan’ category to facilitate checkout — that gained such designation. There’s also ‘thinking alike — already working on it’; ‘let’s test it’; ‘need a meeting’; and ‘research needed.’
And then there’s a category called ‘teaching moment,’ reserved for those instances when an SME politely informs an individual making a suggestion that it is not practical for one reason or another. Here’s an example: an employee in the bakery department, upon watching untold numbers of customers squeeze bread and then pass on it because it wasn’t warm, suggests that Big Y “have a bread warmer like Big Bunny to have warm bread all day.” John Fraro, corporate in-store bakery sales manager, considered the idea and wrote back, “thank you for the great suggestion … the main problem with bread warmers is that they pull moisture out of the product, giving the bread an inferior quality.”
This high level of organization, as well as a detailed database of ideas and follow-up, praise for employees who forward ideas, and commentary from SMEs, are all components of a successful ideas program, said Robinson, also a professor of Operations Management at UMass, who has consulted on the creation of many of them.
He told BusinessWest that there are variations on some of the major themes, as well as variety in the names given to various initiatives and specific components, but there are many common denominators. These include simplicity, a strong buy-in from the top levels of management, and an element of fun, he said, adding that, without these qualities, many programs will fail to catch and keep the attention of employees.
Elaborating, he said that ideas are welcome and accepted at just about every business, regardless of its size. But what most companies still need is an organized system by which employees are encouraged to formulate ideas and, most importantly, know what to do with them when they have them.
“You don’t just want to put a suggestion box out there,” he explained. “You’ve got to have a path so ideas can get where they need to go.”
Why and how companies carve such paths are subject matters that Robinson has been studying for nearly 30 years now, he told BusinessWest, noting that implementation of ideas systems has become a “labor of love.”
His research into the phenomenon has taken him all over the world, starting in Japan in the mid-’80s, where he watched and learned at companies like Toyota. “I was one of the first Americans to go over there and study Japanese management,” he explained. “And one of the things I noticed was that they put a lot of emphasis on getting ideas from their front-line people.
“I noticed that companies here didn’t really pay much attention to it, and neither did companies in Europe,” he continued. “Back in the ’80s, there were businesses in Japan that were getting 50 ideas per person implemented; today, there’s probably only 30 companies in the U.S. at that level; it’s still a very rare practice here.”
This comparatively poor track record helped inspire Ideas Are Free, said Robinson, adding that, with its subtitle How the Idea Revolution Is Liberating People and Transforming Organizations, it was intended to inform and inspire managers to follow best practices.
The followup book, he went on, is not so much about what the best in the world are doing in this realm, but how to get there. “We’ve been helping a lot of companies implement these programs, and asking a lot of questions about how you get from here to there,” Robinson explained. “So for the next book, we’re focusing much more on the journey.”

Getting a Rough Idea
As he talked about that journey, Robinson went to the blackboard in one of the conference rooms in the Isenberg School of Management at UMass and drew a large triangle, and then a line across it near the top.
He did so to illustrate that the vast majority of the ideas generated within a company (80% by his estimation, or what’s below the line) would be considered “small,” and come from employees, with the rest from management. The significance of that diagram isn’t lost on forward-thinking CEOs, he said, adding that they recognize the need to develop coordinated systems to collect, review, and, when warranted, implement these ideas.
Smart managers also resist the temptation to affix numbers to everything, he continued, adding that those leaders continually asking about return on investment from an ideas program are essentially missing the main point.
He noted that, while there are, indeed, gains in terms of cost savings and increased revenue (some of which are harder to effectively measure than others), the real benefits come in the form of improved service to customers — which usually translates into more business — and from employees gaining inclusion and strong measures of satisfaction from identifying, and helping to solve, problems. “Generally, good things happen when you ask front-line people for their ideas.”
And with that, he referenced a sheet of ideas from staff members working in the bar at the Clarion Hotel in Stockholm, a high-end facility known for its customer service.
“Here’s one — ‘get maintenance to drill three holes in the floor behind the bar and install pipes so bartenders can drop bottles directly into the recycling bins in the basement,” he said. “Before, they had to carry a hamper of stuff down the stairs; that saved seven minutes an hour, 15 hours a day, 365 days a year indefinitely, so you could put a number on that one if you wanted to.
“Here’s another one: ‘when things are slow, mix drinks at the table so guests get a show,’” he continued. “If you’re a typical CEO, you’re saying, ‘show me the numbers on these things.’ But this idea makes the bar a little bit cooler, a little bit hotter, and you can’t put a number on that.”
At Health New England, there have been many ideas that could fall into that same category — difficult to quantify from a dollars-and-cents perspective, but beneficial in terms of service to customers, operational efficiency, morale, and building the HNE brand, said Kim Kenney-Rockwal, director of Human Resources for the company.
“Some of them can be very simple, but have a meaningful impact, she said, citing, as one example, the suggestion to acknowledge all résumés that come to the company electronically, rather than through the mail, as was the policy for years.
“This saves paper, time, and postage,” she said, adding that there are, indeed, tangible cost reductions. “About 99% of the résumés were coming in electronically anyway, but we were responding through the mail. This is just something simple that streamlined our process without compromising the brand.”
Explaining how the ideas process works at HNE, Kenney-Rockwal and Walton Bicknell said it starts with the OFI boards, the large white boards posted strategically within each department. New ideas are taped to the top of the boards and later put into an elaborate queue for consideration and possible implementation. Some are in the system for a few weeks, and others for several months.
Ideas fall into three main categories — ‘customer service,’ ‘work culture,’ and ‘process improvement,’ said Walton Bicknell, adding that there have been thousands in each realm, and the various departments compete against each other, informally, to see which has the most ideas implemented.
Kenney-Rockwal and Walton Bicknell told BusinessWest that many companies and institutions large and small, such as STCC, have approached HNE and requested advice and technical support with getting idea programs off the ground. And they have some general advice for those considering such propositions.
“Make it simple,” said Walton Bicknell, “and start slow — don’t try to implement the entire organization at one time; start with one department or two departments and roll it out that way.”
Said Kenney-Rockwal, “make it real, so it has to tie in to what employees are doing every day. It can’t be a program of the month; it has to tie into making their life easier — they need to stop doing the things that are causing them frustration.”
“Our success has come from growing it from the bottom up,” she continued, “but to start, there has to be in a buy-in at the top. And it has to be fun — you need to celebrate the wins.”

School of Thought
All this advice and more was taken to heart at Springfield Technical Community College, where, following initial consultation with Robinson and meetings with OFI leaders at Health New England, a program called Great Ideas at STCC was put in place roughly a year ago.
No one can say with any degree of certainty whether it is the only initiative of its kind within the broad realm of higher education, said Suzor, but then again, no one is aware of any other institution doing it.
One reason why could be the challenging nature of academic settings, which are layered in bureaucracy, and where decisions are rarely made quickly or easily, said Suzor, noting that, while there was trepidation among some officials at the college when the program was implemented, there has been a strong, campus-wide buy-in and many tangible results.
They stem from ideas involving everything from new policies requiring printing on both sides of a sheet of paper, to a strong suggestion to move either a solar-powered trash compactor or the library book-drop receptacle it was apparently mistaken for on a few occasions.
Explaining how the system works, Joan Thomas, director of marketing for the college and a member of the steering committee that oversees it, said it begins with the idea boards, on which each department lists focus areas, and suggestions are posted on large sticky notes.
These ideas are then considered at weekly departmental idea meetings, and they are then categorized in ways similar to those implemented at Big Y (there’s a parking lot at STCC as well).
In many cases, ideas can be implemented on the departmental level, said Thomas, adding that for those that can’t be, there is what’s known as the ‘idea-escalation process,’ whereby OFIs must clear additional hurdles such as review by the college’s management team, the securing of needed financial resources, and/or the approval of senior leadership such as a vice president or the president.
“There are a number of checks and balances put in place to see that ideas are followed up and thoughtfully considered,” Thomas explained. “A vice president can’t just say ‘no’ to something.”
A year into the program, Suzor, armed with that $200,000 net-savings estimate, says the idea program has helped with the bottom line at a time when all publicly funded institutions are feeling the pinch.
“As state funding is declining, we have to figure out ways to increase revenues and decrease costs,” he explained. “And the idea system not only engages the community in doing things for customers, it also gets us focused on ways we can reduce costs.”
And it has been as fun as well, said Thomas, noting everything from the buttons (similar to those Staples ‘Easy’ buttons that say ‘great ideas at STCC’ when you tap them) that are given to participants, to the ‘idea of the month’ videos posted on the school’s Web site that give a dose of exposure — and school pride — to the winners.
“We do manage to have fun with it,” said Thomas. “And we’ve seen great results, which you would expect when you empower front-line employees to have a voice in how we do business.”

Thinking Things Through
Judy Hogan, a customer-relations specialist at Big Y, would agree. She told BusinessWest that, among the many thousands of ideas funneled to the company’s SMEs, one of the better ones recently was a suggestion to further simplify the ideas program.
Instead of being placed in the parking lot, it was awarded the coveted ‘yes, do it’ designation, she explained, adding that the change has helped in the process of tracking and implementing suggestions.
Like the concept of moving keys on the cash register, the idea concerning ideas is a poignant example of what happens when there is a system in place to inspire people to contribute thoughts and then follow through on them, she continued, adding, “it’s what happens when you have a culture that encourages people to keep thinking.”

George O’Brien can be reached at obrien@businesswest.com

New Development Officer Is Focused on the Big Picture

Kevin Kennedy, long-time aide to Richard Neal while he was both mayor of Springfield and the congressman representing the state’s second district, was recently named the city’s chief development officer. In that capacity, Kennedy said he plans to take full advantage of his knowledge of the city, as well as lessons taken from involvement in projects ranging from the building of Monarch Place to the recent State Street Corridor initiative.

Kevin Kennedy is still settling into his new office on Tapley Street.
He told BusinessWest that he has several blank walls to cover, and is still making up his mind on just how to carry out that assignment. However, there are some items up, and together they tell a lot about the city’s new chief development officer, and also help explain why he’s supremely confident he’ll hit the ground running in his new position.
First, there’s the picture of the U.S. team at the first Nike Hoop Summit in 1995. Kennedy, then the head coach at Cathedral High School, is visible on the far left, just a few spots down from an 18-year-old Kevin Garnett. (The event was staged at the Basketball Hall of Fame, and it wanted a local coach to take part). There’s also a framed poster announcing then-President Bill Clinton’s visit to Springfield on Nov. 3, 1996, the so-called Celebrate Democracy event at which he campaigned for himself, but also for John Kerry in his pitched Senate battle against Bill Weld. Kennedy said he was asked to be “protocol chief” for the president and his entourage on that visit.
Also framed and hanging beside his desk is a rendering of the new federal courthouse on State Street, a project that Kennedy helped see from conception to reality as chief administrative aide to Congressman Richard Neal, who secured the funding to build the facility. And then there’s one that will soon be going up — a frame holding two architect’s renderings of what the Great Hall inside Union Station will look like when it’s renovated. (Kennedy always uses ‘when,’ not ‘if,’ as he discusses Union Station, even though the building has been mostly vacant for more than 30 years.)
Together, the wall art tells of Kennedy’s long involvement in Springfield politics, sports, economic development, and even architecture. Individually, they speak to passions — basketball (he won championships as both a player and coach at Cathedral), public service, and, yes, Union Station. The courthouse rendering? That symbolizes strategic planning, he explained, adding that the facility isn’t simply a building, but rather one part of a much larger initiative involving the State Street corridor (more on that later).
“It’s good to have an institutional memory,” said Kennedy, noting that he’s worked for or with every mayor of Springfield, in one capacity or another, since the mid-’70s. “You don’t want to live in the past, but it’s good to know what’s happened previously, what’s worked, and what hasn’t worked.”
Kennedy said his knowledge of Springfield and all the players there — something lacked by some recent occupants of his office — coupled with his experience taking plans from start to finish and his work on broad strategic endeavors, persuaded him that he was the right person for this job, and especially at this critical juncture in the city’s history.
Indeed, 2012 will be a year when tornado-recovery plans are put on the table, many downtown initiatives could take big steps forward, the Union Station project may actually go to bid, and the casino debate — with a Springfield site among many in contention — will intensify.
“While the hits we took in 2011 were substantial, I foresee a very good year in 2012 — we have enormous possibilities,” said Kennedy. “If we can all work together and coalesce around the plans and come up with the correct strategies to implement what’s there, we’ve got great opportunity. We still have good bones and great institutions, and I think downtown will take on a completely different vitality in 2012.”
For this issue, BusinessWest talked at length with Kennedy about his new position, his thoughts on what’s next for Springfield, and how to transform plans into reality.

Background — Check
When asked why he wanted to take on the high-profile chief development director’s job at this stage in his career, the 58-year-old Kennedy smiled and said, “I thought I was still young enough to take on some more challenges.”
Elaborating, he said he wanted to take some of the lessons — and measures of success — garnered from the courthouse and State Street corridor initiatives and apply them to the broad canvas of citywide development.

“The thing that’s attractive about this,” he explained, “is that you get to combine thinking about things — which you must do because you really have to think ahead — with actually getting something done.
“When a project comes up, be it large or small, and obviously the larger ones are a little more complicated, you have to be able to develop the plan and execute the plan,” he continued. “And to go along with all that planning and execution is strategy, which is the piece that keeps the planning and execution together; it’s the glue.”
And as he goes about applying this glue, Kennedy said he’ll take every bit of experience from his nearly 40 years of service to the city and Neal with him to his new office in the Tapley Street municipal complex.
That location is only a stone’s throw from where Kennedy grew up, on Melbourne Street, which no longer exists because the property was taken to build I-291 in the late ’50s. From Hungry Hill, Kennedy’s family moved to the East Forest Park neighborhood, and he attended nearby Cathedral.
He graduated from St. Anselm’s during the recession of the mid-’70s and, after a lengthy search for work, found a position with the city through the Comprehensive Employment and Training Act (CETA) in 1974. He started as a personnel assistant and worked his way up to become personnel director in 1978. Soon thereafter, he became the city’s collective bargaining agent and negotiated labor contracts.
He left municipal service to work for a technology-related startup, Data Management Corp., before branching out into individual data-processing consulting. When Neal was elected mayor in 1985, Kennedy joined him as executive assistant (a job now titled chief of staff), and in that position essentially ran the day-to-day operations of the city.
When Neal was elected to Congress in 1988 following the retirement of Ed Boland, Kennedy eventually joined him after first staying behind to facilitate the transition to first interim mayor Vincent D’Monico, and then elected mayor Mary Hurley.
He coached at Cathedral from ’85 to ’97, during what he called “one of the golden eras” for local high-school sports.
“I had Derrick Kellogg, and Howie Burns had Travis Best and Edgar Padilla at Central,” he said, noting that Kellogg and Padilla played at UMass and Kellogg now coaches there, and Best enjoyed a solid career in the NBA. “We used to fill up the Civic Center; we didn’t play our homes in our own gyms because too many people wanted to watch them.”
In recent years, Kennedy’s responsibilities with Neal have involved more work that would be considered economic-development related, including the State Street corridor, the new courthouse, and Union Station, which he described, alternately, as a “personal challenge” and “the next thing we have to do to complete the plan, with that plan being preservation of the central business district.”

Tracking Results
Kennedy said he clearly remembers what he considers the last big event in the Great Hall. It was early in 1977, he explained, when Neal used the facility to announce his candidacy for Springfield City Council.
“It still looked good then,” he recalled. “It had declined somewhat, but it was still in good shape, and it was still a special place, one with a lot of history.
The hall has been seen by only a few people — maintenance crews, journalists (BusinessWest has been inside a few times), economic-development leaders, and representatives of prospective tenants — over the past 25 years, said Kennedy, noting that efforts to revitalize the station do not constitute a project, although many hold that opinion.
Rather, he explained, the initiative is an important part of a much broader plan for bringing more vibrancy to the central business district. That plan involves the full length of Main Street — from the South End, where the equation, not to mention the landscape, has certainly been changed by the June 1 tornado, to the Chicopee border. It also involves State Street and many other arteries, said Kennedy, noting that all but a handful of Springfield’s neighborhoods are included in this plan.
Elaborating, he said Union Station’s transformation into an intermodal transportation center is one of the links in the chain in downtown revitalization. Some have been completed — 1550 Main Street, the new federal courthouse, and the convention center, for example — but most are still in progress. That list includes Court Square redevelopment initiatives (specifically 31 Elm St.); the Paramount and other endeavors involving the New England Farm Workers’ Council and its energetic leader, Herbie Flores; the vacant and partially demolished Asylum building; and others.
Union Station’s redevelopment would be a catalyst for further progress in the so-called North Blocks area, and the North End as well, said Kennedy, who drew an analogy between the current efforts downtown and the ongoing work along the State Street corridor, while returning to the subject of strategy.
The new federal courthouse was a piece of the State Street initiative, albeit a big one, he continued, adding that there were and are many other components to that strategic plan.
Finding a new use for the abandoned Technical High School was another big piece of the puzzle, he went on, noting that this is why Neal fought tooth and nail to put the state data center (now under construction) there, as opposed to the Technology Park at STCC or anywhere else.
“We knew that we wanted to build a new courthouse,” he explained, “and we knew we had to deal with the disposal of the old courthouse. We also knew that, by itself, the courthouse is not a real economic generator, so the congressman came up with the State Street corridor improvement project, which is what really leveraged the investment in the courthouse.
“We also knew that Tech, which had been sitting there since 1986, was a serious issue in terms of both State Street and the new courthouse,” he continued. “So you had to get a plan that was executable to not only build a new courthouse, but dispose of the old courthouse, do something with Tech, and make all the other real-estate transactions that were necessary for this to happen. There were so many moving pieces that had to be put together, you needed a strategic plan to get them done.”
Returning to Main Street and the central business district, he said individual initiatives are part of a broader plan there as well. And he believes that enough pieces of the puzzle are falling into place to generate more private-sector investment downtown.
“Between reuse of the [old] federal building, Cambridge College coming to Tower Square, 31 Elm St., Union Station, and some other announcements to be made soon, we’re starting to aggregate enough people down there to generate economic-development activity,” he explained. “And, frankly, it’s up to the private sector to take advantage of it.”

Pieces of the Puzzle
When asked about his approach to economic development, Kennedy said he’s adopted the philosophy and operating style of his mentor in this realm.
That would be Gerald Hayes, who was the city’s chief development officer in the mid-’80s, and thus worked with Neal and Kennedy to make the Monarch Place project a reality.
“I learned a lot from him about how to manage a large-scale project and a small-scale project, and the biggest thing I took from him is the importance of accountability,” said Kennedy. “You convene regular meetings, with assignments of future tasks, and then report on what you accomplished on those future tasks, so you’re accountable.
“We did that when we did State Street — we sat regularly, twice a month for two years, planning the corridor project,” he continued. “The results were minimal change orders, and the project came in $600,000 under obligation; the same was true with the federal courthouse. If you spend enough time planning what you want to do, and you do it correctly, that’s critical to the project.”
Accountability will be a much-needed character trait moving forward, said Kennedy, noting that there are many large, complex projects — either in progress or in the offing — that will require high levels of coordination between local, state, and federal officials, and could be described as public-private initiatives.
Tornado recovery certainly falls into that category, he said, noting that, while the June 1 twister impacted several Springfield neighborhoods, most of the rebuilding efforts moving forward will involve the South End, Six Corners, and East Forest Park areas.
A recovery plan is expected from the consulting firm Concordia later this month, said Kennedy, adding that it is likely to spell out specific initiatives for each impacted area. For the South End, where much of the speculation is focused, he expects retail and residential components that will enhance but not change the character of that neighborhood.
“I think it needs much of what it had before,” he told BusinessWest, “which means lots of walk-in retail — it used to be the greatest place to go for restaurants — and you still need a housing component to go with it.
“I don’t think the ideas today will be much different than they were,” he continued, “but they’ll be modern, and there are already people out there speculating, which I take as a good sign.”
Union Station is perhaps the most complex of the endeavors, Kennedy explained, because it is involves a number of players, government agencies, and potential funding sources, including a new round of TIGER (Transportation Investment Generating Economic Recovery) grants from the U.S. Department of Transportation and another transportation reauthorization program (one is about three years overdue).
The plan is to seek bids late in 2012 for construction of a project that will blend transportation elements — rail, inner-city bus, and possibly intra-city bus — with transportation-related businesses and agencies that will fill roughly 75,000 square feet of space, said Kennedy. In that latter category would be the Pioneer Valley Transit Authority offices, the Pioneer Valley Planning Commission, transit-related retail, and what he called “opportunity space.”
If all goes as planned, the project would be completed by 2015 or early 2016, in conjunction with improved and expanded north-south rail service from Southern Vermont to New Haven, with a projected 25 runs a day between Springfield and Hartford going through Union Station.
When asked about the proverbial elephant in the room — casinos — Kennedy, sounding much like Mayor Domenic Sarno in recent interviews, said that, while he won’t necessarily advocate for a casino in Springfield, he considers it his job to make sure that Springfield gets the best “deal” possible, whether the casino is built in the old Westinghouse House site, Palmer, Holyoke, or anywhere else.
And by ‘deal,’ he meant a wide range of considerations, from preferences on employment to traffic-mitigation efforts; from tax benefits to measures that will help minimize the impact on a host of other hospitality-related businesses.
“If you’re in the hospitality business and you’re around a casino, you’ve got a problem,” he said. “Springfield could get hurt, Northampton would get seriously hurt, and Amherst could take a real hit, depending on where this casino is located.
“If we’re going to get one in Springfield, we need to think a little bigger than that citadel, or that fortress that a casino could be,” he continued. “If we put a casino in the North Blocks, for example, and coupled it with a baseball stadium and a revitalized Union Station, and insisted that the MassMutual Center and Springfield Symphony Hall were their performing-arts venue, we’d then have a casino effect that would really be widespread and benefit a lot of people.”

Court of Opinion
While packing up his photo from the Nike Hoop Classic, the Bill Clinton event poster, and the rest of his belongings from his congressional office, Kennedy said he came across his disposition testimony in the legal action involving David Buntzman, former owner of Union Station, and the city of Springfield.
“That goes back to 1989,” said Kennedy, noting that, when the city took the station by eminent domain a year earlier, Buntzman sued for greater remuneration.
Knowing all of what happened back then, and even decades earlier, may not necessarily help in the current efforts to redevelop the station, he acknowledged, but historical perspective, meaning institutional memory, is usually a benefit.
Kennedy has plenty of that, as well as what he called a desire to “get some things done.”
If he can, then he’ll have plenty of new items with which to cover all that wall space.

George O’Brien can be reached at obrien@businesswest.com

Herbie Flores Is Making His Vision for Springfield Reality

Heriberto “Herbie” Flores has always had a heart for needy people, partly because he grew up poor. From its humble origins 40 years ago providing legal and financial assistance for migrant farm workers, he has grown his multi-agency nonprofit, Partners for Community, into an $80 million force for economic development and community improvement. But he’s made bigger news with a series of real-estate acquisitions, including the Paramount Theater (seen here), that promise to transform Springfield’s downtown. The kind of long-term change Flores envisions for the City of Homes will require energy and passion — and BusinessWest’s Top Entrepreneur for 2011 has no shortage of either.

“This city is coming back,” Heriberto Flores said. “People don’t want to live out in the woods.”
He was sharing a vision of a societal shift away from suburban sprawl back to a city-life model, especially as aging Baby Boomers increasingly seek to live close to all the amenities they need and desire, from food stores and restaurants to banks and performing arts.
As Flores spoke those words, he was standing beside the stage of the 86-year-old Paramount Theater on Main Street in Springfield, an icon of music and theater that has fallen into disrepair — but whose walls, ceilings, and fixtures are breathtaking in their ornate beauty, for anyone willing to look beyond the dust, grime, and faded paint.
And vision is something Herbie Flores has in spades.
Just as he sees the potential in the Paramount — a $1.75 million purchase that will require millions more to restore to a multicultural center for performing arts and community events — he’s also an unabashed optimist when it comes to Springfield itself, choosing to focus on the positives of the city and not the large pockets of poverty, high-school dropout rates, crime, and other issues that often color people’s perceptions.
“When you start looking at the assets, the city has clean water and natural resources. We have companies like Big Y, Peter Pan, and MassMutual. We have three TV stations in this city. We have Baystate Medical Center — how many people would kill to have a hospital like that in their region? And all the schools and universities … this is a very good region,” he told BusinessWest.
“I could live anywhere, but I live in Springfield,” Flores continued. “The investments we make in the city, some people say, ‘they’re paying too much for that.’ ‘Why are they doing that?’ But you have to invest for the future. I don’t believe Springfield will be in the position it is today in the future. I see the changes coming.”
For the past three decades, from his stewardship of a social-assistance network called Partners for Community to his more recent ambition to transform the city’s downtown, Herbie Flores has been the catalyst for many of those changes, and for those reasons, among others, he is BusinessWest’s Top Entrepreneur for 2011.

“He’s making investments in Springfield, and this region, at a time when some people and businesses are dis-investing,” said BusinessWest Editor George O’Brien as he explained the selection of Flores as the magazine’s 16th top entrepreneur. “He directs a number of nonprofit agencies, but his actions, especially in recent years, are, in a word, entrepreneurial.
“Purchases like the Paramount and the Bowles building [further south on Main Street] involve risk, and they require vision,” O’Brien continued. “Together with other things happening downtown to bring vibrancy and a larger, more diverse residential population in that area, these bold steps could provide the much-needed spark that Springfield needs.”
Said Flores, “the city needs help, the city and the region; we have a responsibility to step up to the plate. There are problems, but you can’t just stand in the corner and complain. And nobody’s going to do it for you.”
That optimism doesn’t go unnoticed by those in Flores’ circle.
“I think very highly of Herbie,” said Russ Omer, vice president of Commercial Lending for Chicopee Savings Bank, the lead lender on the Paramount project. “He’s been involved in the neighborhood for 30 years, and I’ve always known Herbie to be community-minded. Whatever he did, he always did it for the betterment of his community. The Paramount is just one example of what he does for Greater Springfield.”
For this issue, Flores speaks about some of those initiatives, and discusses how he is creating a legacy that promises to keep improving Springfield long after he’s gone.

Street-level Perspective

At one point during a lengthy interview, Flores brought BusinessWest to the Borinquen project in the impoverished North End of Springfield. The initiative involves the renovation of 41 units of low-income housing, as well as six commercial spaces, including amenities like a grocery store and a laundromat.
The $11 million project, completed in July 2011, combined federal tax credits, private-investment tax credits, Mass. Department of Housing and Community Development funds, city of Springfield HOME funds, and private financing — a good example of the tapestry of players Flores must weave together to turn one of his visions into reality.
And although it’s just one parcel amid one of the poorest neighborhoods in Massachusetts, when one stands under the rebuilt wood porches and clean, quiet doorways away from the street, it doesn’t feel like a low-income neighborhood.
“America was not built by rich people,” Flores said. “It was built by poor people who did something to create wealth.”
Flores knows something about starting poor. Born in Caguas, Puerto Rico, he was intimately acquainted with poverty as his family struggled for sustenance throughout his childhood. It was there, he said, that he began to identify himself with economically deprived groups and devote himself to service on their behalf.
He moved to Springfield with his family in 1965, then served with the Army in Vietnam in the late ’60s. He has remained active in veterans’ causes, and was named Springfield Veteran of the Year in 2001.
But it was his affinity with migrant farm workers that led to the development of an agency — the New England Farm Workers’ Council — to help them out with various needs, from fuel assistance to job skills to education. That agency would, in the decades that followed, morph into Partners for Community, an $80 million nonprofit with several departments under its umbrella.
Those include the Corporation for Public Management, which seeks solutions to welfare dependency, chronic joblessness, and illiteracy, and also focuses on providing services to those with physical and developmental disabilities; the Corporation for Justice Management, a leader in community-based offender re-entry services to reduce recidivism and address public safety; and New England Partners in Faith, which supports small, faith-based organizations.

Solid Ground
Those agencies share space with a number of private businesses in a number of buildings owned by the Farm Workers’ Council downtown, including 11-13 Hampden St., 1628 Main St., and 1666 Main St., among others.
About 25 years ago, Flores made his first forays into real estate through Brightwood Development Corp. (BDC), a nonprofit formed with the goal of providing housing and economic development on the north side of Springfield. As president and CEO of the BDC, he developed a $2.5 million shopping center, La Plaza del Mercado, on Main Street in 1995, followed by a $3 million neighborhood medical clinic, El Centro de Salud Medico Inc., the next year. That was immediately followed by a $2 million rehabilitation of blighted, multi-family houses in the North End.
His recent deals are helping him secure a wide swath of downtown, which will have a dual effect. First, the resulting critical mass of space will ultimately create economies of scale for development opportunities, as well as a diverse mix of inventory that will suit the needs of a wide range of potential tenants. Second, it will allow him to control the immediate environs around his buildings, reducing opportunities for negative elements to creep in.
The Massasoit building, which houses the Paramount, will be renovated as phase one of Flores’ planned downtown redevelopment. The theater will boast a completely new façade, with interior renovation of the seats and stage area, including all technical aspects of a performing-arts theater. Work on the four-story building, which will include other commercial and residential space, is expected to begin during the first quarter of 2012.
As Flores led BusinessWest through the cavernous corridors — including a projection room hollowed out of equipment and rows of narrow, beaten-up, red seats in need of restoration or replacement — he talked about the impossibility of pleasing everyone with a project of this scale, but with a clear belief that the end result will be worth all the give and take.
“You can work to do something for yourself,” he said from the theater floor, just in front of the stage, “or you can work to do something for society.” Clearly, he envisions a restored, vibrant Paramount as an example of the latter.
Then there’s the Bowles building, a property recently purchased for $2 million which currently houses the Student Prince restaurant; that structure will be phase two of the council’s planned downtown development. The office building will be renovated for commercial and residential space, with work beginning sometime in 2013. However, the adjacent parking lot, which will be converted to a four-story, covered parking garage, will be part of phase one and will be completed first.
Flores said the Bowles project could became a key initiative in efforts to prompt more people with disposable income to make downtown Springfield their mailing address, a necessary ingredient in any municipal recovery effort.
Flores has been a participant in two so-called ‘City2City’ excursions that have taken delegations from the Springfield area to resurgent cities — Greensboro and Winston-Salem, N.C. in 2010, and Grand Rapids, Mich. late last year — and said that, in both instances, investments in the downtown areas, and especially those in market-rate housing and entertainment-related ventures, provided sparks that translated into real momentum.
He says he wants to do the same in Springfield.

Glass Half-full
Flores said he enjoys the politics and networking necessary to bring together the necessary investors, both public and private, to create real-estate deals. And he enjoys the challenge of doing so at a time when many people still don’t believe in Springfield’s potential.
“Sometimes people tell you it’s a bad time to invest in Springfield,” he said. “But if you take that attitude, nothing gets done. You have to be able to see the opportunities and run with them.”
Simply put, it doesn’t matter whether people see the city’s glass as half-empty of half-full. “The way I see it, even if the glass is empty, then there are more opportunities.”
The number of projects occurring downtown, he added, will make the landscape more attractive to other investors, although many of the city’s problems — keeping kids in school, creating more jobs, etc. — will take more than time and money to solve, and he also believes Springfield desperately needs an infusion of young, middle-class residents. Still, he said, banks are willing to back realistic capital projects today, even though lending regulations are more difficult to navigate.
Omer called Flores an example of someone creating projects that the entire community can benefit from — the Paramount being a good example.
“He wants to make it available to faith-based organizations, Springfield public schools, and other community events, as well as some general entertainment,” he said, adding that the mere idea of restoring that building appeals to many longtime city dwellers.
“I tell the story that I grew up in Springfield, and I used to go to the movies there. They’d pass out free pencil boxes in the ’50s and ’60s. Today, it could be a museum in itself. I think it’s a great thing to preserve in Springfield, and now the city is going to get to enjoy it.”
Flores says he doesn’t envision the Paramount as a standalone attraction, but something that should operate alongside other entertainment venues and restaurants as part of a destination district for fine arts.
“The symphony should be doing a show, the Basketball Hall of Fame should be doing some kind of activity, the MassMutual Center should be doing some hockey, CityStage should be doing something, and the Paramount should be doing something,” he said. “If we think with a big vision, advertising will come in, and everyone can make money.”
Omer said Flores approaches projects with the big picture in mind, “kind of like a chess player, always four or five moves ahead of the pack. He’s a very bright, astute businessman, and over the years he’s been very successful at completing his projects.”

Something to Build On
In addition to his other endeavors, Flores is president of the North End Educational Development Fund, which administers the largest Hispanic scholarship fund in New England, providing college scholarships for underprivileged, inner-city Springfield residents — and, hopefully, starts them on their own journeys of success.
“I’d like to see another 25 millionaires come out of Springfield,” he told BusinessWest. “If people can make money here, they will invest and stay. I see myself as a catalyst to open doors.”
As he walked around the Bowles building and toward his modest office overlooking Hampden Street, Flores said people have wondered what wealth he could have amassed as a for-profit real-estate entity. But he said he’s building more than just physical structures. He’s also constructing a legacy — through his nonprofit endeavors guided by a committed board — that will far outlast his own life and continue to remake Springfield for decades to come.
“I’m not making anything for myself,” he said. “I’m building all this wealth for the nonprofit, so that, when I’m gone, we’ll be able to do some good in the future. Money is neutral — money is not good or bad. Good people with money can do good things, and bad people with money can do a lot of bad things.
“I have tried to set up these programs and buildings to have something for the next generation,” he continued. “I don’t know who’s going to be here 25 years from now, but these programs and services will still be here.”
Flores said he believes people should take responsibility for their community with the resources they have, and he’s tried to run his business — and prioritize his life — that way.
“I’m hard on myself. I keep saying there’s more that can be done,” he said. “I ask, ‘did you leave it better than found it? What did you do to make this country better?’ I can honestly say I’m still working on it.”
To Herbie Flores, that goal is paramount — and reachable.

Joseph Bednar can be reached at businesswest.com

Previous Top Entrepreneurs

• 2010: Bob Bolduc, founder and CEO of Pride
• 2009: The Holyoke Gas & Electric Department
• 2008: Arlene Kelly and Kim Sanborn, founders of Human Resource Solutions and Convergent Solutions Inc.
• 2007: John Maybury, president of Maybury Material Handling
• 2006: Rocco, Jim, and Jayson Falcone, principals of Rocky’s Hardware Stores and Falcone Retail Properties
• 2005: James (Jeb) Balise, president of Balise Motor Sales
• 2004: Craig Melin, president and CEO of Cooley Dickinson Hospital in Northampton
• 2003: Tony Dolphin, president of Springboard Technologies in Springfield
• 2002: Timm Tobin, then-president of Tobin Systems Inc.
• 2001: Dan Kelley, then-president of Equal Access Partners
• 2000: Jim Ross, Doug Brown, and Richard DiGeronimo, then-principals of Concourse Communications
• 1999: Andrew Scibelli, then-president of Springfield Technical Community College
• 1998: Eric Suher, president of E.S. Sports in Holyoke
• 1997: Peter Rosskothen and Larry Perreault, co-owners of the Log Cabin Banquet and Meeting House
• 1996: David Epstein, president and co-founder of JavaNet and the JavaNet Café in Northampton

Is the Region Set to Turn the Corner?

As 2011 winds to a close, it appears that the nation will see growth of only a percentage point or two. That’s nothing remarkable, but certainly an accomplishment, considering how bleak things looked only a few months ago, when a double dip seemed very possible. And now there are several indicators — from stronger-than-expected holiday sales to signs of life in the housing market — that something approaching real recovery could be on the horizon. But hanging over all the recent good news is a persistent debt problem in Europe that will certainly be a drag on the economy.

When it comes to the regional economy, Karl Petrick said, the phrase ‘turned the corner’ is still not applicable, and may not be for a while yet.
“Let’s just say we’re still trying to get around the corner,” said Petrick, an assistant professor of Economics at Western New England University, as he talked about the recovery, or lack thereof, since the so-called Great Recession. And that process of turning the corner will continue in 2012, he told BusinessWest, adding quickly that there are many signs of optimism as the calendar turns, and that together, they represent a rather abrupt bounce back from the dismal scene that prevailed only a few months ago.
Those signs include:
• Strong corporate profits, which have helped the stock market ride through Europe’s debt crisis (more on that later);
• Improvement on the employment front, evidenced most recently by the half-percentage-point drop in the national jobless rate in November (see related story, page 26);
• A slight uptick in the housing market, although many question marks remain with that critical sector and economic barometer;
• A recent surge on the stock market, although wild fluctuations continue to be the order of the day;
• Better-than expected holiday sales numbers on Black Friday and what has become known as Cyber Monday, and projections that the season as a whole will be better than most projected months ago; and
• Some marginal improvement in consumer confidence, which is considered by most experts to be perhaps the most important factor moving forward.
But hovering over all these pieces of good news is the fact that the economy is still somewhat fragile, said Cliff Noreen, president of the Springfield-based MassMutual subsidiary Babson Capital Management LLC. The primary reason why, he said, is a new acronym that has become part of the global economic lexicon: PIIGS, pronounced ‘pigs.’
That’s short for Portugal, Italy, Ireland, Greece, and Spain, the five so-called ‘peripheral countries’ at the center of a European debt crisis largely responsible for those wild swings that have become the norm on Wall Street this year, and are almost certain to continue for the foreseeable future as those nations work to stem the tide of red ink.

“These countries just have too much sovereign [government] debt,” said Noreen, who helps oversee the company’s $137 billion in assets, noting that the total among them is $4.6 trillion. “Greece is by far the worst of the five financially. It has $500 billion of sovereign debt and has not technically defaulted on its debt yet, but it’s close; it’s being supported by these other countries. Its debt is trading on the market today at 20 cents on the dollar.
“There’s too much debt in these countries, and the banking system is at risk also,” he continued, noting that he’s spending large portions of his days trying to sort out the news coming from these nations. “There are some European banks that have way too much debt, particularly relative to the size of the country they reside in.”
But debt problems are certainly not restricted to the other side of the pond, he went on, noting that government debt in the U.S. recently hit the $15 trillion mark, and moves up approximately $2 million a minute. U.S. government annual receipts currently amount to approximately $2.3 trillion, while expenditures are running at $3.67 trillion.
“The Super Committee was a super disappointment, a super embarrassment,” said Noreen, referring to the bipartisan panel that was assigned the task of blueprinting a deficit-reduction plan — and failed miserably at that task.
The debt on both sides of the ocean, but especially in Europe, is a problem that won’t go away by itself, he continued, adding that debt reduction, in whatever form it comes — mostly through sharp cuts in government spending — will no doubt hinder the process of economic recovery.
“The problem is they have to reduce that debt, and this will slow the economy,” he said of those peripheral countries and the mountains of interest charges they’re facing on their notes. “Approximately 20% of U.S. exports are to Europe; if Europe slows down, which appears to be happening  right now even as we speak, that will impact those exports.”
Bob Nakosteen, a professor of Economics at the Isenberg School of Management at UMass Amherst, agreed. He used the words ‘fragile’ and ‘tenuous’ to describe the current economic scene, and said it wouldn’t take much for arrows to start pointing down again, especially with so much upheaval and uncertainly in Europe.
“The biggest risk we face is completely out of our control, and that’s more than a little scary,” he said, referring to the turmoil in Europe. “Another financial crisis there will affect everyone.
“Meanwhile, confidence, while it has improved slightly, is still in the doldrums, and there remains a great deal of uncertainty,” he continued, adding that there are many factors, from the roller-coaster nature of the market to questions about whether job gains are only temporary, that are impacting that confidence.
“Right now,” he asserted, “the recovery hasn’t gained any firm traction.”

Money Talks
Noreen has become somewhat of a regular on Bloomberg News in recent months.
He’s been spending much of that airtime trying to put what’s happening in Europe in perspective, and explaining why countries and banks there have too much debt on their balance sheets, and what it all means for people here.
He was on with Adam Johnson on the ‘Street Smart’ segment a few weeks ago, talking about, among other things, why Babson Capital isn’t buying any of that European debt that must be refinanced through the financial markets, despite its attractive price and current high yields.
“Every time the interest expense goes up 1%, it just makes the interest expense more unbearable for that country,” he told viewers, adding that the five nations will have to find ways off the debt treadmill, and that doing so will stabilize markets but also curb growth spending.
In simple terms, said Noreen, European countries, with Greece being the worst offender, have spent themselves into near insolvency and now will have to stop spending — and devote considerable capital to principal and interest payments — to get out of the holes they’ve dug for themselves.
“They were allowed to borrow money — and they just kept spending it,” he told BusinessWest. “The government debt was and is way too high relative to the size of the country, and now they have to service it in a weaker economic environment.”
As the European debt crisis plays itself out, the economic picture in the U.S. is brightening, said those we spoke with, adding quickly that things must be kept in their proper perspective.
And to do that, people need only turn back the clock a few months to late August, when the stock market was in freefall and talk of a double dip was heating up. An upturn in the fourth quarter has quelled most of that talk, said Nakosteen, but growth for the year will only be a percentage point or two, which, while expected, is still a disappointment.
And the situation is perhaps even more tenuous in Western Mass., which is lagging both the rest of the state and the nation as a whole, and needs both of those engines to heat up substantially to enjoy any real improvement.
“We have such diversity; except for UMass and Baystate and MassMutual, everything is really fragmented in this region,” he explained. “There’s a little bit of everything here, so it’s really going to take the national economy doing much better for this part of the state to do better.”

Buy the Buy
Looking ahead, though, the economy watchers we spoke with said some recent trends and developments provide some fuel for optimism.
Noreen put soaring corporate profits at the top of that list. Adjusted for inflation, the $1.5 trillion mark projected for 2011 is a near-record high, bringing that important benchmark back to pre-Great Recession levels after plummeting to under $700 billion in 2009.
He also cited corporate and individual cash balances of each in excess of $2 trillion, and noted that the U.S. stock market is also attractively priced today at approximately 12.5 times 2011 earnings.
Petrick, meanwhile, said overall unemployment is at its lowest levels since March 2009, the height of the Great Recession. And in Greater Springfield, there were 1,000 more people in the workforce in November than in September, with unemployment falling from 8.2% to 7.8%
Seasonal hiring had something to do with this, he noted, adding quickly that there has been about a 1% decrease in unemployment regionwide over the past year, with roughly the same number of people in the labor force, which hints of something more substantial.
“That tells you that there might be something more long-lasting,” he continued, noting that the next few months, generally some of the heaviest of the year when it comes to layoffs, will reveal a great deal about whether there is any substance behind those latest employment figures.
“There is some good news out there on jobs, but the rate of growth in job creation is about half of what it is statewide; we’re still the part that drags down the state average,” he went on, noting that Springfield’s high numbers (above 12%) play a big role in that phenomenon.
Meanwhile, confidence levels are rising, at least within the state’s business community: the Business Confidence Index measured by the Associated Industries of Massachusetts climbed 3.7 points in November, to 50.1. That’s the good news; the poll measures confidence on a 100-point scale, with 50 being neutral, and roughly 17 points above and below the all-time low and high.
NetProfitsUScorpsBW1211bBut the real key is likely to be consumer confidence and accompanying spending levels, said Petrick, citing statistics showing that the 30% of business owners who increased capital spending, according to a recent poll, enjoyed higher sales volume this past year, while the 20% who cut spending saw volume decline.
“That’s the Holy Grail for our economy,” he said. “If people have jobs and they’re spending money, this drives the whole economy forward.”
And the early returns on holiday shopping, while mixed, show that consumers are in more of a mood to spend than they were a year ago, said Nakosteen, adding that there are still plenty of caution signs out there, especially in the housing market, which remains a drag on the regional economy.
Looking at all that’s transpired over the past several months and the trends that have emerged, those we spoke with predicted what amounts to more of the same for 2012.
“It’s really hard to see us shooting back up; I don’t see fast growth happening,” said Petrick. “We’re still seeing housing sales and home prices falling, and that’s still a big damper on economic growth and particularly consumer confidence and people’s willingness to buy stuff. So growth is likely to be slow and incremental.”
Said Nakosteen, “there are lots of signs that things are improving, but the problem is there’s still plenty of risk out there. If Europe can somehow avoid a real crisis, and if Washington can figure out how to keep the deficit under control in the longer run … those things would certainly help make our recovery more real.”

Cornering the Market
Looking ahead to 2012, those we spoke with said the national and regional economy could turn the corner — if …
There are many factors involved with completing that sentence, ranging from continued improvement on unemployment to more confidence on the part of both consumers and business owners, and, perhaps most importantly, some form of progress with the debt crises on both sides of the Atlantic.
If those ‘ifs’ don’t materialize, however, then a year from now, the economy may still be in the process of making the turn.

George O’Brien can be reached at obrien@businesswest.com

And the Question Shifts from ‘If’ to ‘Where?’

On Nov. 22, Gov. Deval Patrick ended more than two decades of discussion and debate on the subject by signing a landmark casino bill into law. While that lengthy and controversial chapter in this saga has ended, a new one, involving the awarding of licenses and the drafting of regulations, has begun. And while the competition will play itself out in three regions, much of the focus will be on Western Mass., where the contest is considered wide open and there are several ventures in various stages of development vying for the coveted license.

Allan Blair paused to think for a minute.
This was an exercise involving the region’s business history, mathematics, and those proverbial adjustments for inflation — and it didn’t take very long.
Indeed, only a few seconds in, Blair, president of the Economic Development Council of Western Mass., said that, while he had no official determination on the matter, he thought it quite fair to say that the resort casino due to be built over the next several years somewhere within the 413 area code will easily be the region’s largest development project ever.
And he wasn’t just talking about dollars and cents, although the projected $500 million (minimum) project — at least twice the cost of Baystate Health’s $250 million Hospital of the Future — will certainly cover that aspect of the equation. Instead, he was referring to the word impact. Indeed, this project will have a huge one, encompassing everything from direct tax dollars to employment, both in the construction phase and long term; from traffic and infrastructure to potential effects on many existing industry sectors and individual businesses and institutions.

All this explains why, within minutes after Gov. Deval Patrick signed the landmark casino legislation on Nov. 22 (and, actually, months before that), the emphasis shifted from a question about whether expanded gambling would happen here to conjecture about how to make sure it gets done right.
“We’re only going to get one shot at this,” said Blair, who noted that the EDC supports a casino in Western Mass. due to the job creation and overall investment related to such an endeavor, but is not backing a specific proposal or favoring one type of model (urban or ‘casino in the woods’) over the other. “What we want is a successful venture that will build what it says it’s going to build, do what it says it’s going to do, and create the jobs it says it will create.”
Which brings us to what will certainly be an intense and intriguing competition for casino licenses in the three designated areas of the state, and especially in this region of the Commonwealth. For while nothing is certain in this high-stakes contest, the widespread speculation is that a $1 billion proposal to place a facility at Suffolk Downs in East Boston is all but a lock for the Boston-area casino, and that the entry to be put forth by the Mashpee Wampanoag Tribe (site still underdetermined) is the prohibitive favorite for the Southeast region.
That takes us to what the Boston Herald is already calling the “wild west,” where several proposals, in various stages of development and involving a range of communities, including Palmer, Holyoke, and now Springfield, are on the table.
The region’s largest city and unofficial capital became a player late last month, when Ameristar International went all in by announcing it had acquired the 41-acre former Westinghouse site off Page Boulevard. That gives the region four strong contenders — the others being Mohegan Sun’s proposal for a site just off exit 8 of the Mass Pike in Palmer, Hard Rock International’s plans to build a resort casino at Wyckoff Country Club in Holyoke, and Penn National’s intention to locate a facility in Greater Springfield — with widespread speculation that several more players will emerge and that the eventual winner of the license may not have even put forth a plan yet.
How the selection process will play itself out is another matter of intense speculation, with many observers noting that there is ample room for subjectivity in the procedure designed to pick the ‘best’ proposal.
Some of it involves matters involving agreements with host communities, neighboring ‘impacted communities’ (that’s a technical term), and established businesses and cultural institutions, said Jeff Cuiffreda, president of the Affiliated Chambers of Commerce of Greater Springfield. But it gets even deeper when it comes to weighing one proposal’s merits against another’s when it comes to one of the stated goals of the resort-casino model — regional economic development.
“One of the major criteria that this committee is going to look at is just how big a catchment area a casino proposal is going to benefit,” said Cuiffreda, referring to the five-member gaming commission that will ultimately decide which proposals win the lottery. “But there are a lot of factors that are going to decide this, ultimately.”
For this issue, BusinessWest talked with a number of the stakeholders in this contest — from casino developers to Springfield Mayor Domenic Sarno — about what could happen next and the issues that will shape this all-encompassing regional issue.

All Bets Are On
Troy Stremming says Ameristar’s $16 million gambit involving the former Westinghouse property amounts to a huge statement of confidence on the part of his company regarding that site and what the company plans to do with it.
“We didn’t buy an option,” he said, referencing, without actually saying so, the decision of other casino players to take that route. “The fact that we bought the property outright shows our commitment to not only the state of Massachusetts but the city of Springfield, and it also shows our confidence in this one-of-a-kind site.”
Stremming, senior vice president of Government Relations and Public Affairs for Ameristar, told BusinessWest that the exercise that ended with the agreement to purchase the Westinghouse site began several years ago, as Ameristar, focused on underserved markets when it comes to gambling (and especially those with what would be considered attractive tax rates), starting looking hard at the Bay State and, more specifically, on the more wide-open western region of the state.
“Once we started looking at Massachusetts, we knew the Eastern Mass. license would be hotly contested,” he said, “and some people had a foothold with locations for some time. So we really looked at Western Mass. because the size of the facility and size of the market squarely falls within the Ameristar business model.”
This exploratory process took the company to Springfield — a logical location, he said, because of its size and proximity to other urban centers — and eventually to the Westinghouse site, which Ameristar deemed the most suitable in the City of Homes because of its size and proximity to Route 291 and thus the turnpike.
What’s more, the Springfield location is closer to many population centers in Connecticut, especially the Hartford market, which should benefit the Commonwealth more than a Palmer location chosen by Mohegan Sun, said Stremming, to minimize the impact on its resort casino in Montville, Conn.
“Palmer is as far away from the population base as you can get while still being in the western region,” he said, “and I think that’s more of a defensive move from the Mohegan standpoint so that they’re not cannibalizing their existing market in Connecticut. I don’t have a facility to protect in Connecticut; I’m trying to bring as many of those dollars into Massachusetts as I can.”
And with that, Stremming touched on just one of the myriad issues that will come into play as the five-member gambling commission goes about its task of deciding which of the players will be granted the coveted license for Western Mass., and how all the facilities will be regulated.
While the adjective ‘powerful’ is not officially part of the name given to this body, it might as well be, because the media and other interested parties are already using it extensively in that context, and with good reason. That panel will be charged with effectively answering the query that is seemingly on everyone’s mind — ‘where will the casino go?’
Sarno, like everyone else we talked with, doesn’t really know how that question will be answered. What he does know is that his city is now officially a major player in the casino sweepstakes, a role that comes with many responsibilities — and mindsets.

Indeed, Sarno sounded much like Gov. Patrick at the casino-bill-signing ceremony when he said that, if a casino is to come to Springfield, it has to be done right. This means the facility must makes sense on every level — or be a “game-changer,” a phrase the mayor would use early and often — and it must be something the city wants, not just something some would say it needs.
With that in mind, Sarno intends the referendum on the casino that is part of the legislation to be a city-wide initiative, not simply a vote to be taken by the residents of the ward in question (the East Springfield area of the city), as stipulated in the casino bill.
And while he didn’t directly speculate on whether a casino referendum would pass in Springfield, Sarno hinted that things might go differently than when a referendum was narrowly defeated in 1995, the last time the matter came to a vote in the city.
“The environment and the landscape has changed economically since ’95, and the tornado has changed things as well,” said Sarno, noting that a casino could become a factor in both city-wide recovery efforts and revitalization of a specific neighborhood ravaged by the twister. “This is not going to be a panacea, but it’s a piece of the pie, a piece of the puzzle, and now the letter of the law.
“As far as Springfield is concerned, it [a casino] must be a game-changer, and it must transform and enhance an area,” he continued. “And everyone can be damned sure that I’m going to get everything and anything that will benefit our Springfield residents.”

Showing Their Cards
While Ameristar’s bold move certainly changed the face of the casino debate in Western Mass., there was already considerable speculation about the two other firm proposals on the table — in Palmer and Holyoke.
Long considered the early and certainly unofficial favorite in the Western Mass. casino derby, the Palmer proposal has several major ingredients in its favor, said Mitchell Etess, CEO of the Mohegan Tribal Gaming Authority. These include location and accessibility, the Mohegan Sun name and track record, and the solid backing of the town’s business community and a majority of residents.
Etess said Mohegan Sun can do more than say it will be a good corporate citizen — it can show that it’s been one for more than two years, with a storefront downtown and direct involvement with the town’s business community and citizenry.
“The thing that separates us from most all of the other players is that we’ve been in Palmer for several years now,” he explained. “We’ve been reaching out and having conversations with the community, and we’ve established ourselves as a good citizen; we’ve been doing a lot of things that needed to be done, and now we’ll continue to refine our project and see what the process is.”
Etess said his company will have plenty of ammunition as it goes about answering the state’s request for proposals for a Western Mass. casino and, in so doing, proving its plan is the best for the region and state as a whole.
“We have a great location, we have a community we know is supportive of us, and we’re the premier gaming brand in the Northeast,” he said. “We have a proven track record of dealing openly and honestly with our host communities in both Connecticut and Pennsylvania, we have experience across the board, and the people know what to expect from a Mohegan Sun property.
“We believe that people really know what to expect of us as a neighbor, and that’s an important consideration,” he continued. “These are long-term relationships that communities enter into, whether it’s with a casino or a car plant, so it’s important that people know what they’re going to get from us as a neighbor and as a community partner.”
Jim Allen found himself using many similar phrases to describe the plans of Hard Rock International, which is partnering with Paper City Development on the Wyckoff proposal.
Allen, the company’s chairman, said Hard Rock is one of the world’s most iconic brands, and that this fact, coupled with the company’s experience in the casino business (it has facilities in this country as well as the Dominican Republic and Macau), the location and amenities of the Holyoke site, and even the corporation’s track record in philanthropy should make it a prime contender for the Western Mass. license.
He noted that Hard Rock has been looking at sites across the Bay State for more than four years, and while it explored the other two identified regions, the probability of Suffolk Downs winning the Boston-area license, and the added “complexities,” as he called them, involved with competing against the Wampanoags, brought the company’s focus to Western Mass.
In the Wyckoff location, right off I-91, Hard Rock has what Allen, sounding like his competitors referring to their proposals, called the “very best site in Western Mass.” and a proposal that will bring nearly 3,000 jobs to the area, thus addressing a pressing concern for Holyoke and surrounding communities.
And while he didn’t want to speculate on what will drive the Gaming Commission’s decision-making process, he said these competitions often come down to matters of integrity, and trust that a bidder can deliver what it says it will deliver.
“I’ve been in the business for 31 years, and involved in many of these RFPs,” he told BusinessWest. “We feel that our brand and our site will create a very attractive proposal.”

Roll of the Dice?
But as the various casino players tout their virtues and portfolios, speculation continues with regard to how the commission will ultimately decide which proposals get the licenses.
Cuiffreda said there will be many conditions that developers will have to meet and issues to be addressed — from traffic to the impact on both the host city or town and surrounding communities, to steps to cohabitate with existing businesses and attractions.
But there will certainly be some gray areas, or subjectivity, he went on, noting, for example, that a casino developer’s ability to say its plan will have a direct impact on Springfield’s high unemployment and other social ills could become a huge asset as the city struggles to rebound after years of economic decline and frustration with other attempts at economic development.
“If there is a commitment to hiring Springfield residents, and someone could show they could drive that unemployment rate down by a point, I would say that would be a real positive,” he said. “And then, if the city can mirror the state with regard to a formula where a percentage of the revenue from the casino would go toward education, with the problems already identified in the city — from high teen-pregnancy rates and high dropout rates — that would certainly be money well-spent and something for the people making this decision to consider.”
But other communities have their own issues — high unemployment is regionwide, for example — and competing developers will likely be making other types of commitments, Ciuffreda continued, noting that many factors will go into the decision, with traffic and access, one of the main items of concern with both the Springfield and Holyoke proposals, being just one of them. “And, in truth, traffic is going to be an issue with every proposal, so I don’t know just how big a concern that will be.”
And while the competition plays itself out, Blair and Cuiffreda said their organizations will be watching the proceedings closely and working to do whatever is possible to see that the Western Mass. casino somehow complements the region’s existing business community instead of becoming merely competition for a host of sectors.
This is a difficult assignment, said Blair, but the EDC will be diligent about minimizing the potentially negative aspects of a casino — wherever it is located.
“We’ve said consistently to anyone who’s approached us to educate about their gaming philosophy, and made it known, that they do no harm to the existing, embedded infrastructure of entertainment venues and attractions,” he told BusinessWest. “They can do this by understanding the market, being mindful of these venues, and, as they design their programming for the casino, not consciously create unfair competition for these facilities.
“For example, they won’t need to necessarily build out a large entertainment space that would compete with CityStage and Symphony Hall,” he continued. “They could build a smaller one so it is isn’t competing, or they could have a collaborative relationship with these other venues so that acts that come to the casino one day or week could go to the larger facility on another date. A casino can be a complementor, rather than a competitor to existing businesses.”
That said, Blair acknowledged that there are not many examples of casinos in largely urban areas like Hampden County with which to draw comparisons or use as effective models. “Usually, they’re built in more remote areas that don’t have these competing facilities to begin with.”
Meanwhile, it will be up to the region’s convention and visitors bureaus and specific attractions to promote the other assets of the region to the people who will come to visit the casinos, he said, adding that the potential impact could be enormous. “When you have a draw that will bring hundreds of thousands of people who might not otherwise be in the region, you have to take full advantage of that chance to cross-sell all the other great things that are happening in Western Mass.”

The Bottom Line
Analyzing the developments of the past few months, and the entry of new players into the Western Mass. casino sweepstakes, Etess said he’s certainly not surprised that the field has become much more crowded.
“We never thought this would be a one-horse race,” he explained, adding quickly that he believes Mohegan Sun still has the best horse in the derby, and will prove it over the next few years.
But handicapping this tilt might become a difficult exercise — especially if more proposals materialize, as expected — given all the subjectivity embedded in the process of choosing the ‘best’ plan.
Which is why many analysts are summing up the situation with what would have to be considered an industry term: ‘there are no safe bets.’

George O’Brien can be reached at obrien@businesswest.com