The Town’s Torrid Residential Expansion Slows, Providing Time to Think and Plan
G Brougham and D Albertson say that, with the slowdown in Belchertown residential development, attention can focus again on their towns next steps.
Doug Albertson says he can finally take a breath.
After close to two decades of rapid residential growth in Belchertown, the nations sagging economy slowed the pace of further expansion for one of the fastest-growing municipalities in the Commonwealth. And a break, while it brings hardship to several sectors from homebuilders to home sellers was probably needed.
I think that the building lull has given us a chance to catch up and regroup a little bit, said Albertson, the towns chief planner. Its always good to have a rest, especially after being frantically hurried over the last decade. Its given us a chance to do some real planning.
A town with a rich history, Belchertown was first settled in 1731, and retains much the same boundaries where Jonathan Belcher first took deed in the early part of that century. The October town fair is one of the oldest of its kind continuously operated in the nation, and the creation of the Quabbin Reservoir, mostly within those borders, is one of the Bay States most documented municipal projects of the 20th century.
These days, Belchertown is most noted for that once-enviable pace of robust residential development, what Town Administrator Gary Brougham calls the towns single largest industry. But the community has been in the headlines for the past few years over the fate of the former Belchertown State School.
While the town has been active in seeking ideas for the property, there have been some setbacks. It has contended with both a developer whose ideas were bigger than his checkbook, and a site with millions of dollars in overdue cleanup costs presenting more than a minor challenge for any potential development.
But town leaders remain confident. The Belchertown Economic Development & Industrial Corp. is managing oversight of the state school property, and it is getting ready to propose some new findings to the Board of Selectmen this month. Thats when the rubber really hits the road, said EDIC chair Bill Terry.
In the latest in its ongoing series of community profiles, BusinessWest takes an indepth look at Belchertown past, present, and (potential) future.
Leaps and Bounds
According to town records, Belchertowns population grew, on average, 2% annually for its first 200 years. In 1970, the population was just under 6,000, and by 2000, there were close to 13,000 people in town. The U.S. Census estimates Belchertowns population to be close to 16,000 people now, and projections range to 25,000 in the next 20 years. Between 1990 and 2000, the rate of growth was 22%, more than four times the regional average of 5%.
Despite such an influx of new residents, Albertson said that what the community lacks is density.
We are 50 square miles thats one of the largest geographical towns in the state, he said. If you look at the core of the town, out of the towns 15,000 people, Belchertowns center has maybe half that. Everybody else is closer to Amherst, Ware, Palmer, and Ludlow.
What that translates to is a bit of a challenge for a homegrown business district. Belchertowns center is an historic village green, but it lacks the presence of a commercial destination. Instead, business districts are pocketed in areas on Routes 9 and 202.
In terms of new growth, were always trying to attract new business, said Albertson. But one of the challenges we have here is zoning. We dont have a lot of land that is zoned for business, and changing that can be difficult. Once a residential neighborhood is established, people dont like the idea that business can show up in their neighborhood. Everybody wants new business in town, but they want it over there. And there really isnt any there here.
Jim Phaneuf agrees. Hes the owner of Bell & Hudson Insurance, a business that can trace its roots back to the Civil War. For 23 years he has been located close to the downtown area, but doesnt find the widely spread population to be a drawback.
Its a rural economy, sure, he said. For the people who live here, though, my sense is that people want to do their business locally. They tend to make a strong effort.
One reason I think is that the business community does a great job of supporting local causes, he continued. If you look in our weekly paper, you see thank-you notes to the local businesses for supporting things at the high school, or local fund drives to donate money to cancer research. I dont think that a week goes by where you dont see a letter of some kind like that.
Brougham said the towns business population might not be highly visible for the outside visitor, but it is there, and strong.
Theres a pretty equal mix of small mom-and-pop shops and larger businesses, he said. Two lumber companies, Northeast Treaters and Universal Forest Products, are both significant employers in town, and the construction sector, the way it is, hit them hard. But they are still in good shape. Another manufacturer of construction materials, National Fiber, is also holding its ground.
With the residential boom in Belchertown, that construction sector has been an important facet to the towns economy. And when turmoil hit Wall Street, it also hit Belchertowns Main Street.
The builders, tradesmen, landscapers, Realtors, bankers, lawyers, everyone has a stake in construction here, said Brougham. But that pace has slowed significantly.
From more than 100 or more housing starts per year we were down to 13 last year and 12 as of Aug. 1 this year, he said, adding that, with such a slowdown in activity, the time is perfect for people wanting to make a move.
There is still activity out there, he said. A new subdivision was recently approved, and theres a multiple-year backlog of available property. Lots that had been selling for $160,000 could be had for much less today.
For Albertson, the focus on town development in the residential market isnt a drawback at all. Weve been growing at a manageable pace, really, and financially were sound. That might be one of the advantages of having a primarily residential tax base. People complain about it all the time, but when businesses suffer, we arent stuck with a lot of empty properties.
Back to School
The 70-plus acres of the former Belchertown State School have been a concern since Beacon Hill decommissioned the facility in 1992.
Currently zoned for light industrial use, the property had a brief flicker of hope when a developer sought to bring a large-scale resort spa and wellness-related businesses to the site. The concept, though supported in principle, never got off the ground. Albertson credits the EDIC with solid vision, and said it has been great at focusing on what can be done there.
We got a grant under Mass State Law 43D, he continued, which states that a town can designate an area a priority development, and we received $100,000. Looking at the site, weve hired the engineering firm Fuss & ONeill to do site and conceptual planning. Theres been a marketing firm, RKG Associates, to do a feasibility analysis to find out where the market is, and to get a realistic and sober view of what we have there.
So, instead of casting a line out and seeing where it blows, he continued, its a much better way of looking at our site objectively, and looking at what our assets and disadvantages are.
Cleanup at the site has proven to be a big, lingering disadvantage. Old buildings (some in terminal deterioration), asbestos, and old steam tunnels all have conspired to keep most developers at bay. While the town has succeeded in gaining approval for a $10 million bond specifically to address those conditions, the bond market hasnt hasnt been very inviting of late, and cleanup continues to wait. But the law is there, Albertson said, so once the money has been raised we should get up to that amount.
Terry is one of those people who remains confident that, when it comes to effective reuse of the site, its a matter of when, not if, it will happen. Since 2000 he has been actively seeking answers for the property. While there is the main campus of just over 70 acres, other neighboring school parcels have been successfully developed. The new Hampshire County Courthouse and Sheriffs Office, Easthampton Savings Bank, and TSC Tractor Supply Warehouse, all at the intersection of Routes 202 and 21, sit on one of those parcels.
Sure, weve only delivered some $78,000 dollars to the town in taxes, and weve only developed slightly under $20 million in private investment, he said. And weve only delivered around 150 full-time jobs. This doesnt sound like much, but when you consider that there was nothing its not too bad.
At the selectmens meeting scheduled in September, Terry said that there are two feasibility plans that will presented. While nothing could be made official at press time, he did say that they are two solid approaches.
One of them is, as we have done since 2002, one property at a time, he explained. The second concept that I know is to consider a mixed-use type of development. However, that would require some retail/commercial-type space, and you would have to identify who would take advantage of that. Where are those customers going to come from?
Terry has some thoughts for what he believes would be successful at the property. Weve been dancing around a bit with an assisted-living developer, he said. A project with 90 units I absolutely believe that would be a slam dunk, because all those younger people moving into town have mom and dad to think of in the near future. Sooner or later, theyll need assisted-living types of housing. Theres no reason, in my opinion, why that couldnt be successful.
Albertson also looks ahead, rather than dwelling on the past pitfalls. I think theres a lot of potential, but I think it has to be done in a way that will grow with the community. Rather than something imposed on the town, something that just shows up and buries us do it in a way that improves the community and adds to our employment base. I think it can be done right. Its not going to happen in a year, but its already been 15, so we do want to do this right.
The New England Small Farm Institute is on the other side of the property, he continued, and we keep thinking about UMass, because an institutional connection seems to me like a perfect thing. Weve got the UMass farms and orchards already in town, and it would not be much of a stretch at all if the university had a further presence here. Its all about using the site, providing employment and activity in town without adding a lot of extra traffic.
Speaking personally, Phaneuf said that hed just like to see more jobs created in the town. We employ 14 people here (at Town Hall), and while thats small, thats a similar size for many businesses in town.
What I would like to see is a place to create jobs within the community so that people wouldnt have to leave, he continued, noting that 75% of the population currently travels out of town for work.
Plan Be
Devising ways to lower that number appreciably is just one of the things that town officials can do with that breathing room that comes with the lull in residential expansion.
That lull wont last forever, or even another year or two, as the economy begins to improve and developers again eye ways to develop more of this communitys wide, open spaces. Challenges like the fate of the Belchertown State School property remain, but, overall, the forecast remains bright for a community with the room and the imagination to keep on growing.
Summit Will Shine a Spotlight on the Importance of Literacy
Chris Matthews, host of MSNBC’s Hardball, will speak about the importance of literacy at the Oct. 4 event.
Gianna Allentuck calls it the snowball effect.
Shes referring to research that shows that, when communities implement successful literacy programs, businesses, families, and society reap real benefits that boost the economy.
Allentuck is an adjustment counselor at Elias Brookings School in Springfield and the person who gave birth to the upcoming literacy-based event, United in Hope: A Community Comes Together.
On Oct. 4 at 2 p.m., national media personality Chris Matthews will convene a free, inspirational program about literacy programs in the area. It will be staged at the Naismith Memorial Basketball Hall of Fame in Springfield in collaboration with WWLP-22 News, and will include an address by Matthews as well as compelling stories.
We hope to encourage people in the audience to volunteer and become involved in the literacy effort as they hear stories of success, Allentuck said. More volunteers means more services can be offered. And if more students graduate from high school, more will go to college or into the work force, which will make Springfield stronger economically. Then, businesses from other parts of the state or other states will pay attention to this city.
The afternoon will begin with a talk by Matthews about the importance of education in maintaining Americas standing in the world.
The author, international journalist, and political commentator is host of the MSNBC show Hardball with Chris Matthews as well as a weekly syndicated news program.
Allentuck worked as a nanny for his children years ago and invited him to lead the conference. His job is to educate people and make them think about issues and pay attention to them, she said.
There will also be presentations about five successful Springfield-based literacy programs. The event will be conducted in a town-hall-meeting style to allow people to interact with presenters.
Maura Geary, project manager for the Regional Employment Board of Hampden Countys LiteracyWorks initiative, says literacy and education is a continuum.
Its a fundamental part of the health and vitality of our community, she said. The business community consistently tells us they depend on a literate and skilled workforce. It can influence whether a business locates or remains in an area. We know literacy begins at birth and continues through school years and into adulthood.
The first presentation will focus on the importance of exposing children to reading and books at a young age. It will be given by Bonnie McCain from the Early Childhood Center of Greater Springfield. She is a really excellent teacher who has done a lot of training in the community, said Geary. She has also had a lot of success in helping children learn to read and helping parents implement strategies at home to improve the literacy of young children.
The second presentation, by representatives from the Hasbro Summer Learning Initiative, will focus on the importance of summer programs.
Research from the Nellie Mae Education Foundation shows that children in low-income families start school with a pronounced literacy gap. Although they may catch up during the school year, the gap remains and increases every summer. There is a two-month gap when they enter kindergarten, which increases to a two-year gap by fifth grade, said Geary.
Hasbro runs a very effective program to reduce this gap that involves 3,500 children in 40 programs in Greater Springfield. It operates via a theme-based approach that includes options ranging from hip hop and drumming to theater and a hands-on Connecticut River Watershed program.
Hasbros program was developed by local experts and is aligned with the Massachusetts School Curriculum Framework, said Geary.
BusinessWests Difference Makers class of 2009 raised money to purchase 350 books for a component of the Hasbro program in which teachers work with children identified as struggling readers. Also, the magazine has committed to making literacy an ongoing focus for future classes of Difference Makers.
The third success story comes from the Big Y Youth Employment Mentoring Program. Its a partnership with Springfield Public Schools to reduce the high school dropout rate, which stands at 60% in Springfield and Holyoke.
Although this statistic, combined with the poverty rate, educational gaps, and budget cuts can paint a negative picture, Geary said the program will make people aware of the incredible things going on in our community.
Leslie Lawrence is a shining example of the difference an individual can make. The Springfield Schools volunteer has succesfully recruited hundreds of volunteers and mentors. She and her mentee will talk share their experiences and what it takes to make a difference in the life of a young person.
Research shows that in order to be successful in school and in life, children need a significant or meaningful relationship with an adult. But there are many children who dont have that, said Geary.
The afternoon program will also include a focus on adult-literacy programs. Geary said 17% of adults over the age of 25 in Hampden County dont have a high-school diploma, and 22% of the population age 5 and older speak a language other than English at home.
We know that adults need to have access to language and literacy programs to become productive citizens, better workers, and good members of the community, said Geary. Unfortunately, due to budget cuts, more than 1,200 adults are desperately waiting for spots to open in literacy progams in Springfield, Holyoke, and Chicopee.
Angelica Bay, who came to the U.S. from Russia in 1992, will share the story of how literacy programs helped her soar to success. The 19-year-old couldnt speak a word of English when she arrived here, but thanks to local programs, she earned a bachelors degree from UMass Amherst, is working towards a masters degree, and is personally responsible for helping 16 people learn English and find employment.
Event organizers include Literacy-Works, the Irene E. and George A. Davis Foundations READ! Reading Success by Fourth Grade program, Springfield Public Schools, and WWLP-22 News.
How to Prevent a Potential Disaster for Your Heirs
If you pay bills and bank online, and handle much of your financial activity there, your agents under your durable power of attorney, or the executor of your will, or the administrator of your estate must have access to that information in order to manage your financial affairs when you are no longer able to do so.
Even something so seemingly simple as canceling a deceased persons account on a social-networking site such as Facebook, LinkedIn, or Twitter may be extremely frustrating and heartbreaking for a fiduciary who doesnt have the username and password combination to access that account.
Most security officers of Web sites will allow access with proper documentation, such as a certified death certificate and certificate of appointment from a probate court, appointing someone as the fiduciary of the decedents affairs. However, when someone becomes incapacitated, the guardian or conservator who needs access to the information is often blocked by the Web sites privacy officer, who may require a specific order from a judge. In fact, some credit-card companies and other vendors will also not allow a fiduciary to have access without a specific court order.
The entire process can be quite frustrating and expensive, and it may also require the filing of separate documentation with the court. Very often, the executor or power of attorney spends countless hours tracking down information and attempting to locate and obtain access to the Web sites holding accounts of the deceased or incapacitated person.
This may all be prevented by taking a few simple steps right now.
In this day and age, most individuals with Internet access have login names and passwords. In fact, it is likely that you may have several passwords and/or usernames for various Web sites, as some require a combination of capital and lowercase letters as well as numbers or symbols.
All is well so long as you are alive and healthy. Unfortunately, a problem is likely to occur upon your incapacity or death if access to your login names and passwords is not available to the person functioning as your durable power of attorney, executor, or administrator.
Think about this. It is likely that you perform all or many of the following functions online: banking, booking flights, paying bills, and purchasing goods and services. Even Web-based e-mail programs like AOL, Gmail, Hotmail, etc. may contain vital information that will be necessary once you cant handle your own finances any longer.
You may not wish to share this private information with anyone during your lifetime, but in the event of incapacity or death, it is vital that this information is available to those who will handle your affairs. Certainly, with the significant issues of fraud and identity theft so prevalent, you dont wish to share your passwords; however, it is prudent to have them documented so they can be accessed upon your death or incapacity.
This information may remain private simply by telling whoever will be responsible for your financial affairs the login name and password for access to your computer and that there is a document there with all of the necessary information. In this manner, if passwords are changed routinely and often, then the person who will act on your behalf knows how to access the information when it is required.
The person who is trusted with this information may be the agent under a durable power of attorney and/or the executor of your will. Often, the same person is nominated to serve as your fiduciary. If there are two separate individuals or entities serving, then both may receive it, or one could be given the information, and the other may be provided with the knowledge as to who is in control.
Some people choose to keep this information in a safe place, such as a safe in their home or a safe-deposit box. However, when you pass away, what happens if no one knows where the key is or the combination to your safe? It is critical to trust at least one person with your sacred information regarding passwords. An often preferred option is to place this information in a sealed envelope and keep it with your original will and durable power of attorney at your attorneys office. Because passwords are changed and new sites are added to the list, this envelope may be updated or substituted.
In the past, when a person completed an estate-planning questionnaire for their lawyer, it required information such as names, addresses, and financial accounts. In this day and age, it is important to also have access to an individuals e-mail, because many clients prefer to communicate through that channel, so it likely contains vital information.
In addition, if you are self-employed, access to your Web site, personal, and business e-mail, customer service departments, orders, marketing, etc. may not be available without password knowledge. This information is private, but crucial to have available if and when you become incapacitated or die.
Naturally, this problem is providing an opportunity for businesses to provide solutions. One such entity that will provide private storage and access to this information is Legacy Locker. This company provides family members or fiduciaries safe and secure access to account information in time of need. It maintains information including e-mail addresses, photo-sharing accounts, online auction access, and all other online information. It even allows other private information to be stored, such as memoranda regarding the ultimate distribution of tangible personal property and any special information regarding end-of-life decisions, funeral arrangements, etc.
When opening the Legacy Locker account, you designate the verifiers who will have access to the information upon your death or disability. This provides peace of mind regarding personal information privacy while living. Confidential information will be preserved in one place and distributed only under emergency circumstances. Fees are generally charged annually or as an upfront lump sum for your lifetime.
It is likely that safeguarding this private information is going to be an integral part of preparing an estate plan in the future. This will provide peace of mind so you can be assured that your personal information will remain confidential until it must be accessed by someone responsible for handling your affairs. n
Attorney Hyman G. Darling is chairman of Bacon Wilson, P.C.s Estate Planning and Elder Law Departments. His areas of expertise include all areas of estate planning, probate, and elder law. Darling is a past president of the Hampden County Bar Assoc., teaches Elder Law at Bay Path College, and is an adjunct professor at Western New England College School of Law (the LLM program), where he teaches elder law. He is a frequent lecturer on various estate-planning and elder-law topics at both the local and national levels, and he hosts an estate planning blog at bwlaw.blogs.com; (413) 781-0560;[email protected]
Recent Discrimination Developments in Employment Law Provide Poignant Lessons
Over the past year, there have been several decisions in Massachusetts employment law that may have an impact on how business owners and managers hire, terminate, or address an accommodation. And they offer some practical, and important, lessons.
It is important to note that, while the facts outlined below may be very similar to circumstances regarding your employees, every employment-based decision is unique and must be reviewed on a case-by-case basis.
The following two cases were decided by the Massachusetts Supreme Judicial Court (SJC), the highest court in the Commonwealth of Massachusetts. They deal directly with issues of accommodation and religious discrimination.
In Massachusetts Bay Trans. Auth. v. Massachusetts Commission against Discrimination, the court addressed the issue of whether an employee must engage in an interactive process with a prospective employee to determine a reasonable accommodation for religious beliefs. In this case, the complainant applied for work as a part-time bus driver with the Massachusetts Bay Transportation Authority (MBTA). Despite being qualified in all other aspects of the job, the MBTA refused to hire the complainant because he could not accept shifts that interfered with his religious observation of the Sabbath.
When the MBTA refused to hire the employee, he filed a complaint with the Mass. Commission Against Discrimination (MCAD) alleging discrimination based on religion. The employee demonstrated that he had a religious belief and that he was a piquant in his church. The MCAD found in favor of the employee because the MBTA failed to introduce any evidence it engaged in any effort to accommodate the employee, and that the MBTA was required, without exception, to engage in an interactive process with the employee.
The MCADs ruling in favor of the employee was ultimately upheld by the SJC. However, the SJC stated that there is no obligation to undertake an interactive process if an employer can conclusively demonstrate that all conceivable accommodations would impose an undue hardship on the course of its business. The SJC stated that such a demonstration would be extremely difficult without interacting with the employee.
The SJC also addressed the issue of undue hardship in accommodating a religious belief. In Brown v. F.L. Roberts, an employee worked for an oil/lube service/car-repair center. He was a devoted Rastafarian, and as part of his religious practice, he neither shaved nor cut his hair. His employer was aware of his religious beliefs. The employees job responsibilities included working in the bay under the car as well as in the facility greeting customers and performing various sales duties.
Several years after the employee started working at the location, a new vice president of operations implemented a personal-appearance policy requiring that all employees remain clean-shaven with their hair trimmed. The employee informed the manager that he was unable to comply with the personal-appearance policy. In response, the manager told the employee that he would not be permitted to have any contact with customers and would work solely in the lower bays, away from the customers. The conditions in the lower bays were significantly worse than anywhere else.
Based on these facts, the lawsuit began in the MCAD and the Equal Employment Opportunity Commission, and then ultimately found its way to the SJC. The SJC was asked to address whether an employer can claim an undue-hardship defense when it is not engaged in an interactive process with the employee and whether granting an exception to a grooming policy would pose an undue hardship on the business. The SJC held that an employees initial request for an exemption to the grooming policy did not relieve the employer of its obligation to attempt to provide the employee a reasonable accommodation. The SJC also held that an exemption from the employers grooming policy could not constitute an undue hardship as a matter of law.
The second-highest court in Massachusetts addressed an issue relating to race-based discrimination.
In Thomas OConnor Construction Inc. v. MCAD, the complainant was an employee of a subcontractor. The complainant filed a charge with the MCAD alleging that the job superintendent of the general contractor had discriminated against him and a coworker by using offensive and explicitly racist comments and epithets when referring to them.
After the hearing, the MCAD found in favor of the complainant and ordered that the general contractor pay $50,000 in emotional distress damages and a civil penalty in the amount of $10,000, and was required to conduct annual training sessions for five years regarding race-based discrimination.
The general contractor appealed on the premise that it was not liable to the complainant because the complainant was an employee of the subcontractor. The Court of Appeals held that the general contractor could be liable under Massachusetts law for the hostile work environment created by its job superintendent where it had notice of the allegations, corroborated some of the allegations, and failed to take corrective action.
Employers should take caution because this case demonstrates that, when an employer is aware of a possible hostile work environment, it should take steps to investigate and otherwise remedy the situation.
There were also cases in the Massachusetts Superior Court where the court addressed various issues relating to employment law including age and handicap discrimination.
In Woldemariam v. Pilgrim Parking, the complainant was an assistant manager of a parking company. During the course of his employment he sustained a work-related injury and was subsequently laid off. The complainant alleged that when the employer terminated him after he sustained the work-related injury, he was discriminated against based on a handicap.
Ultimately, the case found its way to the Massachusetts Superior Court. The court found in favor of the employer because the employee was unable to demonstrate that the suspected reasons for his layoff were in fact the cause. The employer had alleged that the employee was a poor worker and that his termination was an economic necessity. While the complainant was able to demonstrate a solid case for discrimination, the employer was able to demonstrate that there was a work-related reason for termination outside of the complainants injury.
In Somers v. Converged Access Inc., the complainant alleged that he had been discriminated against based on age. The employee had been asked to be considered for two open positions within the company. When the employer filled the positions with other individuals, the complainant believed he had been passed over by the employer because of his age.
The Superior Court ruled in favor of the employer because it maintained that it had selected other individuals based upon qualification and experience, and also because the complainant was unable to demonstrate that either hiring decision was the result of discrimination, and had failed to demonstrate he possessed the skills for the position.
In Fischer v. Pres. & Fellows of Harvard College, the complainant alleged that she had been discriminated against based on age because she was terminated and replaced with a younger employee. The Superior Court was not persuaded by the plaintiff offering statistics that older employees were not hired as often as younger employees.
In addition, the court was not persuaded by a few stray remarks regarding the complainants age, because those remarks did not create a sufficient basis for a discrimination claim. However, the court denied the employers motion to dismiss because it found that her successor had been given a higher rate of pay despite having less experience, and the number of complaints made by the plaintiff against her supervisor were potentially indicative of a vendetta.
These cases clearly demonstrate that every employment decision made by an employer must be reviewed carefully. The facts and circumstances surrounding a hiring or firing must be made for reasons related to the business.
Kevin V. Maltby, an associate with Bacon Wilson, P.C., is a former prosecutor for the Northwestern District Attorneys Office with extensive jury trial and courtroom experience; (413) 781-0560; linkedin.com/in/kevinmaltby;
How They Can Impact Gift- and Estate-tax Planning Strategies
The Applicable Federal Rates (AFR) established by the Internal Revenue Service have a substantial impact on various gift- and estate-planning strategies. Each month the IRS determines the interest rate that must be used to measure the present value of annuities, income interests, and remainder interests for gift-tax purposes. This is known as the Section 7520 rate.
Low AFR rates are particularly beneficial to certain gift- and estate-tax planning strategies, and thus create opportunities for transferring assets to the next generation without, or with fewer, gift- and estate-tax consequences. This article discusses strategies for realizing these benefits.
Intra-family Loans
An example of an intra-family loan is when a parent loans money to a child and the child issues the parent a promissory note evidencing the loan. The then-applicable AFR rate is the minimum interest rate the parent must charge on such a loan to avoid potential gift-tax problems. Another example is a similarly structured loan from a grandparent to a grandchild. However, with respect to the intra-family loans, it is important that the payments required under the note actually be paid to the lender. Moreover, any forgiveness of debt by the lender will constitute a gift to the borrower, which could lead to gift- or income-tax consequences.
Generally, the loan proceeds are invested by the borrower with the expectation that the return on those invested assets will be greater than the interest rate on the promissory note. Thus, the net effect of such a loan should be that the future appreciation of the invested assets in excess of the interest rate on the promissory note will go to the borrower as a tax-free gift.
Loan to Grantor Trust
A loan by a parent, for example, to an irrevocable trust that the parent established is also very effective. However, such a trust should have some other assets to repay the loan that is made to the trust. Otherwise, the IRS might contend that the lender retained an interest in the trust for estate-tax purposes.
If it is a grantor trust, it will provide even greater benefits. If the trust is properly drafted and administered, the trust assets will not be subject to estate taxes upon the death of the grantor. Additionally, because of grantor trust status, all the net taxable income of the trust is reported by the grantor on his or her own personal income tax return. This results in the trust being able to grow faster since the income taxes attributable to the trusts taxable income are paid by the grantor and not by the trust.
From an income tax point of view, its as if the grantor had made the loan to himself. The intra-family loan to the grantor trust should have no income-tax consequences since the interest is not taxable to the grantor. The tax laws do not treat the income-tax payment made by the grantor as an indirect gift to the trust. The promissory note from the trustee of the trust should use the minimum AFR rate.
Sale to Grantor Trust
Another type of intra-family loan involves the sale of appreciated assets to a grantor trust in exchange for a promissory note from the trustee of the trust using the minimum AFR rate (unless the lender wants a higher rate). Because of the grantor trust status, there is no income tax on the difference between the value of the asset sold to the trust and its cost basis.
The payment of interest by the trust to the grantor has no income-tax consequences. It is neither deductible by the trust nor treated as interest income by the grantor. With respect to this type of sale, it is very important, however, that the promissory note be paid in full to the grantor before his or her death. Otherwise, the non-recognized gain at the time of the original sale to the trust might be recognized in the event that the trust still has a debt to the grantor at the time of his or her death.
This type of sale can be leveraged if the sale involves a fractional interest in an asset rather than the entire asset. The value of a fractional interest in an asset should be less than its percentage value of the entire asset because a bona fide purchaser would insist on a discount for purchasing a fractional interest.
Grantor Retained Annuity Trust
A Grantor Retained Annuity Trust (GRAT) provides an excellent opportunity for someone who wants to pass wealth to his or her next generation and minimize transfer taxes (e.g., gift or estate taxes). The GRAT is an irrevocable trust for a term of years to which the grantor makes a one-time transfer of property. The grantor retains the right to receive a fixed payment at least annually from the GRAT for the specified term of years.
At the time of the transfer, the grantor makes a gift calculated on the present value of the remainder interest. At the end of the term of years, the trust property is distributed to or held for the benefit of the remainder persons named in the trust.
The grantor-beneficiary of the trust must outlive the term of years in order for the GRAT to remove the trust assets from the grantors estate. As with many of the techniques, the successful use of a GRAT calls for a balance of factors. The longer the term and the larger the annual payment, the lesser the amount of the gift that reverts to the next generation. On the other hand, the longer the term, the greater the risk that the grantor-beneficiary of the trust will predecease that term, in which case the then-value of the GRAT is includable in the deceased grantors estate. However, if the grantor dies during the term of the GRAT, the estate of the deceased grantor is no worse off than if that grantor had never used the GRAT (except for the cost of having set up the GRAT).
Private Annuity
Private annuities provide various tax advantages. In a typical transaction, a parent transfers property to his or her child, and the child gives an unsecured promise to pay the parent a fixed amount of periodic income for life. To avoid a gift, it is important to structure the private annuity so that the value of the assets transferred to the child equals the present value of the annuity to be paid. With a lower AFR rate, the amount the child has to pay as an annuity to his or her parent is less.
The private annuity is a good strategy when the parent has a short life expectancy. This is due to the fact that the private annuity automatically terminates upon the annuitants death. If the parent is deemed to be terminally ill, then the mortality component of the IRS valuation tables cannot be used to determine the present value of the annuity. A person is deemed to be terminally ill if there is at least a 50% probability that he or she will die within one year.
However, a private annuity certainly becomes disadvantageous if the annuitant lives beyond his or her life expectancy since the payments must be made for the annuitants lifetime. Moreover, it is important to note that the payer of the private annuity does not get a tax deduction for any of the payments made, which would be the case if the transaction had instead involved a loan by the parent.
Charitable Gift Annuities
An increasingly popular method of benefiting a charity, but with the donor receiving regular payments from the charity, is through a charitable gift annuity. Many charities offer these annuity opportunities. With a low AFR rate, the potential income-tax charitable deduction for the gift annuity will be less, but a lower AFR rate permits a higher portion of the annuity payments to be received income tax-free. This would be particularly valuable to an individual who does not itemize his or her deductions.
Charitable Lead Trust (CLT)
A charitable lead trust (CLT) is a trust that pays income to a charity for a period of years, after which the trust assets revert back to the grantor. If the CLT is established upon the grantors death, then the reversion would be to the individuals and/or trust designated to receive the trust assets upon the expiration of the time period. If the CLT is set up as a grantor trust, the grantor will be taxed on the trust income each year but will receive, in the first year that the trust is funded, a charitable deduction for the present value of the charitys interest over the specified period of years. A low AFR rate results in a lower present value of the reversionary interest to the grantor or other beneficiaries, and thus increases the grantors charitable deduction.
Using a non-grantor CLT, there is no initial charitable deduction, but the grantor is not taxed on the CLT income each year. Instead of the trust assets at the end of the term reverting to the grantor, the assets are distributed to named family members, other third persons, or trusts. The low AFR rate increases the present value of the charitable interest and thus reduces the value of the remainder interest for determining whether there is a gift subject to a gift tax (if the CLT was funded during the grantors lifetime), or whether the value of the remainder interest is subject to an estate tax (if the CLT was funded upon the grantors death).
Charitable Remainder Interest in Personal Residence
An individual can make an outright gift of his personal residence to charity but retain a life estate to continue to use and occupy the personal residence during his or her lifetime. The residence may be the primary or secondary residence. When a low AFR rate is applied, the present value of the charitys remainder interest is higher, and thus the donor receives a larger income-tax charitable deduction.
When a Low AFR is Detrimental
A low AFR rate makes it more difficult to properly structure a charitable remainder trust (CRT). The typical CRT is funded by the grantor and provides for a fixed percentage payment each year to the grantor during the grantors lifetime or for a specific term of years. On the grantors death or the expiration of the term of years, the CRTs assets are distributed to charity. The grantor should get a partial income-tax charitable deduction when he or she funds the CRT. Additionally, appreciated assets can be used to fund a CRT, and the trust in turn can then sell the assets without any tax on the gain. If the payout rate to the beneficiary is greater than the income of the CRT, however, then some of that non-taxed gain will be considered distributed to the beneficiary for that year and thus taxable to the recipient as a capital gain.
A low AFR rate complicates the use of a CRT because it is more difficult to satisfy two of the code requirements for the CRT to be qualified. One requires that the remainder interest to the charity cannot be less than 10% of the initial value of the assets transferred to the trust. Second, the possibility for exhausting the CRT assets before the end of the CRT cannot be more than a 5% probability at the time the trust is funded. Despite these difficulties, there are certain ways to design a CRT to be able to satisfy these percentage requirements even when a low AFR rate is applied.
Qualified Personal Residence Trust
A qualified personal residence trust (QPRT) generally involves an individual transferring his or her personal residence (either a primary or secondary residence) to a trust for a fixed term of years. The consequences are similar to that of the GRAT discussed above. If the grantor survives the term of years, then the residence in the QPRT is transferred to the designated beneficiaries. If the grantor does not survive the term of years, then the value of the residence is includable in his or her estate for estate-tax purposes.
When the QPRT receives the residential property, a gift to the remainder beneficiary is deemed to have occurred. The value of that gift is based on the value of the retained right to occupy the residence by the grantor during the term of years, the applicable AFR rate, and also the age of the grantor. With a low AFR rate, the value of the retained right to occupy is lower, thus increasing the present value of the gifted remainder interest for gift-tax purposes. Nevertheless, the use of a QPRT can be an effective way to transfer a residence with a lower gift value then an outright gift of the property to that remainder beneficiary. This can be especially effective if the gift involves a fractional interest in the residential property.
Conclusion
With interest rates still low, there are substantial wealth-transfer opportunities available for parents, grandparents, and others who wish to transfer assets to the next generation or beyond and, in the process, minimize or eliminate transfer taxes, whether they be gift or estate taxes. Current economic conditions have resulted in depressed asset values, but when combined with the attractive growth-shielding tools discussed in this article, now is the time to be calling your estate-planning attorney.
As Steven Leimberg, a nationally recognized estate planner, wrote in his April 2009 newsletter, estate planners are witnessing a rare convergence of events favorable to their clients. These events include depressed value of assets, low AFR rates, and significant valuation discount techniques. As with many issues surrounding tax-centered estate planning, however, these factors are vulnerable to economic and legislative change. It is therefore important to take advantage of these opportunities while they are available.
Richard M. Gaberman, Esq. is of counsel to the Springfield law firm Robinson Donovan, P.C. He specializes in estate and trusts, tax and estate planning, corporate and business transactions, and commercial real estate; (413) 732-2301.
Abundant Wellness Center Offers a Healing Touch
Debee Boulanger turned this house in Chicopee into a multi-faceted center for holistic healing.
Debee Boulanger was trained as a nurse, but it took her two decades to figure out how best to apply her skills and desire to help people. After returning to school to learn therapeutic massage, she launched her own business in Chicopee. Apparently, she tapped into a need; after only a few years, the Abundant Wellness Center boasts some 25 practitioners in therapies ranging from massage and yoga to acupuncture and Reiki and much more. For Boulanger, its all about helping people who are beaten down by the stresses of life and showing them how to heal.
Debee Boulanger comes from a family with more than a dozen nurses, so it was natural for her to pursue that field.
But after a short time working in a nursing home in New Hampshire, she became disillusioned with how care was delivered so she switched gears completely and went into retail instead. But the need to care for other people eventually nagged at her again.
After more than 20 years, I knew I needed a change, she told BusinessWest. I had a lot of experience in management and sales, but I loved helping people, and I wanted to get into a field where I could truly help somebody.
She considered becoming a yoga instructor, but instead felt drawn to massage, so she scouted out area schools, settled on the Boston Muscular Therapy Institute in Cambridge, and enrolled in a two-year program, commuting every weekday from Northampton to study the art of therapeutic massage.
That was the late 1990s, and back then, Boulanger couldnt envision what that decision has led to: the Abundant Wellness Center, her own business in Chicopee, which now houses some 25 therapists most of them independent contractors under one roof, professionals who specialize in not only massage, but a palette of other holistic health services, from acupuncture, Reiki, and yoga to hypnosis and classes aimed at both emotional and spiritual well-being.
Its been a successful business model, and one that perhaps surprisingly, but perhaps not, depending on ones perspective has not been dented by the ongoing economic downturn that has companies of all kinds struggling.
Our business has increased. Weve gained lots of new clients, Boulanger said frankly. Whether someone has lost a job or not, theyre coming in here because theyre stressed out and worried, and were a place of peace. We can offer them healing.
She emphasized that, while no one is happy about a recession that costs jobs and increases stress, the silver lining may be that people are starting to look inward at whats important in their lives.
Its forcing people to tap into the true value of themselves, and the biggest investment one can make is in their own health not their house or their car or their boat, but their health, Boulanger explained.
I think, in our society, people feel guilty about taking care of themselves, but thats changing. At one time, people were saying, Ill treat myself. Now theyre saying, I need this therapy. They recognize that its important to their health. Theyve been running their children here and there, spending very little time on themselves, and then, all of a sudden, they get sick or theyre in pain, and theyre forced to take care of themselves. Thats when we see them coming to us, whether its taking a yoga class or getting a massage or acupuncture.
In this issue, BusinessWest pays a visit to Boulangers holistic emporium to learn how an interest in massage turned into an abundant passion for wellness.
Pressing the Flesh
In 2000, after completing her training in Boston, Boulanger shared space with another massage therapist in Chicopee while she built up her clientele, aggressively marketing her services with special offers, holiday gift certificates, and connections with the citys Chamber of Commerce and other networking groups; soon she had put together a consistently full schedule.
Not long after, she struck out on her own, recognizing a need for holistic health services and envisioning a multi-disciplinary health center that went well beyond massage. She purchased a run-down two-story house on Route 116, alongside Interstate 391 and WWLP TV-22, and went to work renovating it.
She opened in 2004 with a handful of massage therapists and one yoga instructor, and has grown the business from there. Many clients first find the center when passing by on the road; between cold calls and word of mouth (and a detailed Web site), Boulanger said the client base has grown steadily without much in the way of marketing.
People read up on everything we have to offer, and theyre definitely comfortable calling here, she said. And once theyre here, they feel theyre going to be in great hands.
Her own hands benefited from training in a wide range of massage therapies, and learning many modalities was one of the keys to building an early client base, she said. Even now, Abundant Wellness Center offers Swedish massage for stress reduction, deep-tissue massage for injury rehabilitation, and hot stone treatments to ease stress and tension and promote relaxation. There are also massage options for couples, pregnant women, even newborns, who reportedly reap benefits such as more restful sleep, improved digestion, and better immune function.
Acupuncture clients also have options. The treatment in its basic form elicits a response from the nervous and immune systems, directing the bodys life force or energy (qi) to return the nervous system to a balanced state. It can reduce muscular spasms and tightness the occur after an injury, and produces a general feeling of relaxation.
But the center also offers something called a tui na massage, which acts as an adjunct to acupuncture and involves pressing, kneading, and rolling techniques to increase circulation along acupuncture pathways. Meanwhile, a facial-rejuvenation acupuncture treatment uses points on the face and beck to increase the flow of qi and blood to the face, staving off premature aging and reportedly aiding with other health issues, including allergies and digestive problems.
The center also offers one-on-one sessions and/or group classes in reflexology (which employs pressure on the feet and hands), as well as detoxification, yoga, Pilates, and even belly dancing.
Theres also a host of energy work, including Reiki and craniosacral therapy (which taps into the cerebrospinal fluid to enhance the bodys healing capabilities), as well as hypnotherapy and spiritual-growth sessions. Many services at the center have a spiritual side including meditation and prayer-writing for those seeking that, Boulanger said.
Many clients want to seek out a more spiritual path, she told BusinessWest. We dont try to sway people from their religion by any means. But many therapies connect the mental to the physical, and now they want to take the next step.
Its all about a holistic approach to well-being, she explained, one that encompasses body, mind, and often spirit, and recognizes the connections between each. Many of our clients will read our flyers and be curious about some other class or workshop.
Lay Your Burdens Down
Most of the treatments offered at the Abundant Wellness Center target stress in some form, because thats either the cause or symptom perhaps both of many health-related complaints, Boulanger said.
Stress can cause chronic pain, headaches, digestive problems, poor posture, anxiety, depression, emotional issues, she ticked off, noting that each of these conditions in turn leads to further health problems and more stress. It creates a big ball of stress, and if people dont know how to handle it, theyll never get rid of those problems.
Not all stress is the same, though, so we have to look and see whats going on, she continued. It could be stress from an accident or a lost job. It could be any number of things. If someone came in for massage and we felt they needed acupuncture, wed send them in that direction. If I recognize that someone needs a chiropractic adjustment, I wont hesitate to recommend that even though her business doesnt offer that service.
Boulanger said some people go to a spa to de-stress, but she wasnt aiming for a spa feel when she set up the center. Neither did she want a doctors-office environment, but instead a homey feel, which her customers about 60% of whom are female appreciate.
Ensuring that people are comfortable is key. For some, making the leap from something familiar, like massage, to a practice like acupuncture, which to many people seems more exotic, can be daunting, but Abundant Wellness offers a free consultation to determine whether someone is a good candidate. Its all about matching each client to the right service, Boulanger said, which is why the sheer range of holistic services she offers is so crucial.
Its very important to have that consultation because they dont feel like they have to commit to something that maybe theyre not sure about, Boulanger said.
She finds that her chair-massage service, which costs just $1 per minute and involves no clothing removal at all, is a good way to get people comfortable with the types of stress-reducing services available to them.
Weve done that at companies, she said. Its very relaxing. Some make a comment that they dont want to go back to work, but I know for a fact that theyre clearer and have a better work attitude afterward. Theyre more productive after a chair massage, and they appreciate that the company invests in them in that way.
Again, it all comes back to investing in ones health. In these troubled times, its something people are seeking in abundance.
Joseph Bednar can be reached at
Identity-theft Seminars
Sept. 22, Oct. 13: Representatives of Royal & Klimczuk, LLC, of Northampton and Springfield, in conjunction with Whalley Computer Associates, will present several seminars on revisions to the identity-theft regulations that will impact businesses. The regulations will be effective March 1, 2010, according to the Office of Consumer Affairs and Business Regulation. The most dramatic change to the new regulations is its adoption of a ‘risk-based approach’ to information security. Both seminars will be held at Whalley headquarters, One Whalley Way, Southwick. For more information on registration, call (413) 586-2288 or e-mail at [email protected].
Exhibition Opening and Reception
Sept. 14-Oct. 2: The Augusta Savage Gallery at UMass Amherst will host an art exhibition titled “My Journey Through Line: Paintings and Drawings by Carolyn Mae Lassiter,” beginning with an opening reception Sept. 14 from 5 to 7 p.m. Lassiter, a self-taught Santa Fe artist, was inspired by the art she observed in the early 1970s while living in Mexico with a family of indigenous Nahuatl artists. Her current works include recurring themes of soulful and thoughtful female energy, as well as of dreams, spirituality, life in the country, family, and animals. The Augusta Savage Gallery is located at 101 New Africa House, 180 Infirmary Way. For more information, call (413) 545-5177. The event is free and open to the public.
Dinner Forum
Sept. 15: For individuals feeling trapped in a family business, a lecture planned by the UMass Family Business Center may be the answer. The lecture will be presented as part of a dinner forum from 5 to 8:30 p.m. at the Clarion Hotel & Conference Center in Northampton. For complete details, visit www.umass.edu/fambiz or call (413) 545-1537.
Lecture on Debt as Venture Capital
Sept. 22: Darian Ibrahim, an assistant professor at the University of Wisconsin Law School, will launch the fall speaker series at the Western New England College Law and Business Center for Advancing Entrepreneurship on Wilbraham Road, Springfield, at noon. Ibrahim specializes in corporate and securities law and its application to entrepreneurial activity. He is interested in the legal and economic issues involved in financing rapid-growth start-up companies, which he examines in recent work on angel investors, venture debt, and the geography of entrepreneurship. Ibrahim teaches courses in business associations, securities regulation, law and entrepreneurship, and corporate governance. The lecture is free and open to the public; lunch will be provided. For more information, call (413) 796-2030 or e-mail [email protected]. For details on upcoming programs, visit www.law.wnec.edu/lawandbusiness.
Breakthrough Executive Board Luncheon
Sept. 24: Noah Berger, executive director of the Mass. Budget and Policy Center, will be the speaker at the quarterly business luncheon of the Breakthrough Executive Board. The meeting is planned from 11:45 a.m. to 1 p.m. at Red Rose Restaurant in downtown Springfield. Berger will address issues concerning the state budget, including an overview of the state fiscal crisis, the role of federal stimulus funding in Massachusetts, and state budget transparency. The fee for the luncheon is $20 per person, payable at the door. All members and sponsors can invite guests to attend the luncheon.
Charity Auction
Oct. 2: The fifth annual Charity Auction to benefit the Boys and Girls Club of Chicopee is planned at the club’s gymnasium at 580 Meadow St. Festivities get underway at 6 p.m. with both a silent and live auction. Admission is free. New this fall is an online auction feature at www.bgcchicopee.cmarket.com. The event will also showcase a mini Taste of Chicopee with local restaurants highlighting signature dishes. Items available for bid include gift certificates to area restaurants, sporting event tickets, jewelry, golfers’ packages, fitness club memberships, and much more. The Chicopee Savings Charitable Foundation is the auction’s presenting sponsor. Donations are still being accepted, and a variety of sponsorship levels are available. For more details, call (413) 206-4110.
Realtor Assoc. Trade Show
Oct. 14: The Realtor Assoc. of Pioneer Valley Inc. will host its 16th annual Education Fair & Trade Show from 7:30 a.m. to 5 p.m. at the Springfield Sheraton. The annual affair combines educational opportunities and a trade show for realtors and affiliates. Highlights include speakers on real estate education, a continental breakfast and luncheon, networking opportunities, and a wine and cheese party. For more information, contact Catherine V. Hannum at (413) 785-1328.
Oktoberfest
Oct. 14: An After 5 & Tabletop Expo is planned from 4 to 7 p.m. at the MassMutual Center in Springfield, sponsored by the Affiliated Chambers of Commerce of Greater Springfield. Exhibitors are still sought for the business-to-business event. The general price to exhibit is $175, $100 for Chamber members. Parking is $5 at the MassMutual Center Garage. General admission is $20 and $10 for Chamber members. For complete details, visit www.myonlinechamber.com.
YPS New Year’s Celebration
Dec. 31: The Young Professional Society of Greater Springfield has once again chosen downtown Springfield for its New Year’s Eve celebration. Only 300 tickets will be available for the affair at the Marriott Hotel in Tower Square. Businesses and individuals interested in sponsorship of the event should visit www.springfieldyps.com for more details. For ticket information, call Jill Monson of YPS at (413) 219-9692.
The following building permits were issued during the month of August 2009.
| AGAWAM Bob Wilcox AMHERST Jones Property LTD Partnership Town of Amherst CHICOPEE Waycon Inc. GREENFIELD Edward Wierzbowski Franklin Medical Center HADLEY 48 Bay Road LLC 220 Russell Street LLC Jennifer Snyder LaComb Holdings Leon Markowski Peter Grandonico Steve Volpe HOLYOKE City of Holyoke Schools Dennis Walsh Holyoke Public Library McDonald’s USA, LLC PBHQ Whitney Inc. | LUDLOW Town Of Wilbraham Walter S. Wood, LLC NORTHAMPTON College Church Inc. Lawrence & Mary Cadorette Mauro & Claire Aniello Northampton Brewery William & Evelyn Mock SOUTH HADLEY All Saints Church Mt. Holyoke College SPRINGFIELD American International College Baystate Medical Center City of Homes Association Salvation Army Springfield Day Nursery WESTFIELD Ron Schortmann Roots Youth Facility WEST SPRINGFIELD Century Park, LLC |
Affiliated Chambers of Commerce of Greater Springfield
www.myonlinechamber.com
Sept. 14: Ludlow Golf for Kids, hosted by Ludlow Country Club. Registration and lunch from noon to 1 p.m.; shotgun/four-person scramble at 1 p.m. The cost is $110 per person or $400 for a foursome. Sponsorships are available.
Sept. 22: West of the River Chamber of Commerce Board Meeting, 7:30 to 9 a.m., hosted by Captain Charles Leonard House in Agawam.
Amherst Area Chamber of Commerce
www.amherstarea.com
Sept. 23: Chamber After Five, 5 to 7 p.m., hosted by the Emily Dickinson Museum, sponsored by Amherst Insurance Agency/The Nathan Agencies. The cost is $5 for members and $10 for guests.
Chicopee Chamber of Commerce
www.chicopeechamber.org
Sept. 16: Salute Breakfast, 7:15 to 9 a.m., hosted by the Log Cabin Banquet & Meeting House. The cost is $18 for members and $25 for non-members. Register online at www.chicopeechamber.org
Franklin County Chamber of Commerce
www.franklincc.org
Visit the chamber online to learn more about upcoming events.
Greater Easthampton Chamber of Commerce
www.easthamptonchamber.org
Sept. 18 and 19: Electronic Recycling Collection, hosted by Red Rock Shops, College Highway, Rte. 10, Southampton. Sponsored by Duseau Trucking LLC, Autumn Properties, and Greater Easthampton Chamber. Event allows people to responsibly dispose of their old computers, monitors, TVs, stereos, and small home and office appliances.
Greater Holyoke Chamber of Commerce
www.holycham.com
Sept. 16: Greater Holyoke Chamber of Commerce Annual Outing, 5 to 7:30 p.m., hosted by Holyoke Country Club, Country Club Road, Holyoke. Featuring a chance to win $1,000. Tickets cost $25. Call the chamber at (413) 534-3376 for tickets or to become a sponsor, or visit www.holycham.com for more information.
Greater Northampton Chamber of Commerce
www.explorenorthampton.com
Visit the chamber online to learn more about upcoming events.
Quaboag Hills Chamber of Commerce
www.qvcc.biz
Visit the chamber online to learn more about upcoming events.
South Hadley/Granby Chamber Of Commerce
www.shchamber.com
Sept. 22: Premier Beyond Business, 5 to 7 p.m., hosted by the Sycamores. The guest speaker will be Ken Williamson of the South Hadley Historical Society, who will speak on the Sycamores’ history and renovations. Sponsored by Premier members Berkshire Bank, Chicopee Savings Bank, Easthampton Savings Bank, Florence Savings Bank, Jubinville Insurance Group, PeoplesBank, and Private Financial Design. The cost is $10 at the door for chamber members. Reservations are necessary; RSVP at (413) 532-2480 by Sept. 18.
Three Rivers Chamber of Commerce
www.threeriverschamber.org
Visit the chamber online to learn more about upcoming events.
Greater Westfield Chamber of Commerce
www.westfieldbiz.org
Sept. 19: 50th Anniversary Celebration of the Greater Westfield Chamber of Commerce, 5 p.m. to midnight, hosted by Tekoa Country Club, Route 20, 459 Russell Road, Westfield. Sponsored by Berkshire Bank. The theme for the evening is ’50s Diner. A Cruise Night will be set up in the parking lot. Bands include the Drifters and Corey and the Knightsmen. Tickets cost $35 through September 13, and $45 thereafter. For reservations, call (413) 568-1618, E-mail [email protected], or sign up at www.westfieldbiz.org.
Sept. 23: Mini Trade Show, 10:30 a.m. to 3 p.m., hosted by Westfield State College, Ely Campus Center, Main Lounge Area, 577 Western Ave., Westfield. The event aims to acquaint the college community, faculty, and students with local businesses and their goods. Call (413) 568-1618 with any questions, or E-mail [email protected].
Young Professional Society of Greater Springfield
www.springfieldyps.com
Sept. 17: Third Thursday, 5 to 7 p.m., hosted by Café Lebanon in Springfield. Relax after work and socialize with other area young professionals.
The following Business Certificates and Trade Names were issued or renewed during the month of August 2009.
| AGAWAM A V Tech Maid to Impress Pheasant Hill Village Associate Parks Photoz Valenti Properties AMHERST Amherst Computersmiths Sherwood Trunks Super Clean CHICOPEE Advanced Seemless Gutter Dishin’ it with Alexis Extreme Excavating Source Diamonds EASTHAMPTON David Adler Consulting EAST LONGMEADOW G & S Commercial Services Marx Entertainment GREENFIELD Budget Blinds of Amherst Designs by Monique HADLEY Peter’s Nails Show Your Marbles Split Excavating Inc. HOLYOKE Angela Gerhard Jewelry Cayey Social Club Megan’s Treasures The Right Touch Willie Wonka’s Candy Shoppe Wuglyees NORTHAMPTON Common Threads Cooper Green Design Dare to Dream Jane’s Cleaning Service | Mineral Hills Winery Sarah Did It Spectrum Painting PALMER April Eve Images Palmer Foundry Palmer Variety Country Store & Deli The Turtle Road Tavern SPRINGFIELD Affordable Airport Car Service Amara’s Dressmaking & Alterations Ananda Hair Extensions Bling Blings By Val Val Café Divang Dexom Mobile Corp. Discount Deli Double A Construction Company GDH Property Management Gina’s Hair Salon Imani’s Candy Store WESTFIELD Aging at Home Caldwell Banker Residential Broker Eagle’s Nest Roadside Grill Laurinda’s Bird Services Mokan Floors WEST SPRINGFIELD Baystate Family Chiropractic Diamondhead Designs Dot’s Hair Care Estilo Isla Barbershop New England Printers Practical Computer Solutions Steven’s Jewelers Inc. Thermotech Heating & Cooling |
The following business incorporations were recorded in Hampden, Hampshire, and Franklin counties and are the latest available. They are listed by community.
| AGAWAM Felicita Food Service Inc., 71 Cooley St., Agawam, MA 01001. Oleg Fronchkevich, 71 Cooley St., Agawam, MA 01001. Mobile food service. Edward J. Chapdelaine Inc., 356 Front St., Chicopee, MA 01013. Edward J. Chapdelaine, 120 Maximilian Dr., Chicopee, MA 01033. Surveying, civil engineering, developing site plans. Esmanur Corp., 565 Main St., Indian Orchard, MA 01151. Ayse Karaarslan, 556 Grattan St., Apt. 1, Chicopee, MA 01020. Pizza Restaurant. Happy Valley Guitar Orchestra Inc., 41 Valley St., Northampton, MA 01060. Peter Donald Blanchette, same. Exclusively for charitable, educational and scientific purposes. SOUTH HADLEY SPRINGFIELD E-Z Bagger Corporation, 106 State St., Springfield, MA 01103. Diane Saia, 502 Frank Smith Road, Longmeadow, MA 01106. Will exploit the patent applied for a transporter/barrel system. | The International League of Muslim Women Inc., 28 Southern Road, Springfield, MA 01129. Doretha Guess, Same. Exclusively for charitable, educational, and social services. Irene E and George A Davis Foundation, 1 Monarch Place Suite 1450, Springfield, MA 01144. John H. Davis, Same. Private grant-making foundation. North End Towing and Auto Repair Inc., 1655 Main St., Suite 504, Springfield, MA 01103. Julio C Feliciano, same. Towing and auto repair. Secure Energy Auto Leasing Inc., 146 Chestnut St., Suite 400, Springfield, MA 01103. Kevin Mattson, 44 Letendre St., Feeding Hills, MA 01030. Motor vehicle leasing. The Life You Save May Be Mine, 650 Belmont Ave., Springfield, MA 01108. Matthew B. Harrison, same. Operates for charitable, educational, religious and/or scientific purposes. Fuel First Front Inc., 592 Birnie Ave., West Springfield, MA 01089. Sanjay Patel, same. Gas station and convenience store. WESTFIELD Eagle Construction Group Inc, 24 Sylvan Dr., Westfield, MA 01085. Sergio Bonavita, Springfield Street, Feeding Hills, MA 01030. Construction company. |
Attorney Franklin L. Baxley has joined the Springfield law firm Robinson Donovan, P.C. Baxley specializes in employment-law counseling and litigation.
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The Forest Landowners Assoc. has announced the appointment of Cinda Jones as the new Massachusetts State Coordinator. As President of W. D. Cowls Inc., Jones oversees the timberland management, lumber manufacturing, and real-estate divisions of her family’s ninth-generation business in Amherst. State coordinators work with other volunteer leaders from their region to oversee membership and outreach efforts.•••••
Big Brothers Big Sisters of Hampden County has appointed Joel Morse to its newly created position of Director of Partnership Development. In his role, Morse will be responsible for driving strategic growth through cultivation, recruitment, stewardship, and support of corporations, colleges, and other organizations that can provide sustained volunteer resources.•••••
The public accounting firm of Gomes, Dacruz & Tracy, P.C. of Ludlow has named Mark A. Germain, CPA as Manager.•••••
Vanessa Van Stee, M.D., has joined Fred Mudawwar, M.D., and Jonathan Bayuk, M.D., of Hampden County Physician Associates, LLC, Westfield, in the practice of allergy and immunology. Van Stee specializes in the treatment of allergic diseases, asthma, and other diseases of the immune system.•••••
Avon Products Inc. recently recognized Linda Shea for being a top Avon Leadership/Sales Representative during the President’s Recognition Program Celebration on Paradise Island in the Bahamas. The annual event brings together the nation’s top-achieving Avon representatives who have distinguished themselves as top performers in sales or leadership.•••••
Samuel J. Nutter has been named New England Business Development Director of the Conservation Services Group in Westborough. He is a native of Longmeadow. He will represent the company’s interests at regulatory proceedings, advisory council meetings, and other industry forums in the region. Nutter will also be responsible for monitoring state energy legislation.•••••
Ashley L. Mickiewicz, a Project Manager at O’Reilly, Talbot and Okun Associates in Springfield, has become a licensed professional Engineer. She specializes in providing geotechnical services including the design of foundation systems, temporary earth-support systems, basements, retaining walls, pavements, vapor-intrusion-mitigation systems, and general earth work. Mickiewicz is also involved in the evaluation of seismic considerations on construction projects.•••••
Juliet Locke of Vanasse Hangen Brustlin recently earned her professional Traffic Operations Engineer certification. She is a Transportation Engineer in the firm’s Springfield office. To earn the designation, engineers must demonstrate knowledge, skill, and ability in the specialized application of traffic operations engineering.•••••
Quality Printing Company Inc. of Pittsfield announced the following winners in its 2010 “A Closer Look at the Berkshires” Photography and Art Contest:• Daniel Morgan was awarded the top prize for his image of the Hoosac Tunnel in Florida. Morgan also won the third prize for his image of Outlook Summit in Florida.
• Ruth Pierce won second prize for her image of a Cheshire lake.
• Runner-up winners included Anne Kotowicz, Nancy Choquette, Mick Garrold, David Stein, Jane McWhorter, Debbie Storie, and Jerry Christopher.
•••••
The Pioneer Valley Chapter of the American Red Cross announced the following:
• Brenda Brouillette has been promoted to Deputy Director of Chapter Services.
• Mary Nathan has been named Director of Disaster.
•••••
Lisa K. Baltronis has been appointed a Mortgage Consultant at PeoplesBank.•••••
Wing Memorial Hospital in Palmer announced the following:• Dr. Philip Cohen, a board-certified surgeon, now performs general, bariatric and minimally invasive surgeries using the laparoscopic technique.
• Dr. A. Daniyal Siddiqui now provides oncology and hematology services to cancer patients.
• Dr. Vijay Kasturi now performs oncology and hematology services to cancer patients.
Work of Arts
Wendy Rosen of the Rosen Agency presents the 2009 Niche magazine Top Retailer Award to Don Muller, owner of the Don Muller Gallery in Northampton. The award recognized 30 craft retailers who are committed to growing and strengthening the North American crafts community.
Moving In
On Sept. 1, Springfield officials and those involved in the project to renovate 60 Congress St. gathered to mark the completion of those efforts and the pending arrival of the Pioneer Valley Planning Commission (PVPC) as lead tenant. In 2008, local businessmen, Jerome Gagliarducci and Zane Mirkin purchased the foreclosed property and invested just under $4 million in renovations. Full-scale gutting and restoration transformed the building into Class A office space. From left are Gagliarducci; Mirkin; Springfield Mayor Domenic Sarno; Tim Brennan, director of the PVPC; Richard Butler, PVPC chairman; and Bob Greeley, president of RJ Greeley Co., which handled leasing efforts.
With the possible exception of the bill-collection business, virtually every sector of the economy has been negatively impacted by the current recession. But perhaps none more than the hospitality industry, and especially the restaurant business.
It is a simple truth that, when money is tight, people (even current generations) will splurge less and stay home more. In reaction to this fact of life, area restaurateurs have responded with determination and imagination, necessary ingredients if one is to not merely survive but somehow thrive in these challenging times.
As outlined in a piece in BusinessWests annual Restaurant Guide (page 23), steps taken have been as varied as the items on a typical dinner menu; from reducing lighting and energy costs to expanding the menu with lower-priced items; from cutting down on printing costs to staying visible through aggressive, targeted marketing.
Restaurateurs typically run a tight ship they have to because margins are so low to being with but these days, that ship is much tighter.
The hospitality sector is certainly not alone in its creative, determined response to the softened economy and its ongoing implications, but its actions serve as strong testimony to the fact that, while this recession is in all ways painful, there are practical lessons to be learned from it, and ones that could help this region become more competitive in the long run.
The biggest lesson, clearly, is that companies shouldnt wait until the storm is upon them to look at their operations and devise ways for them to run more efficiently and creatively. This mentality should prevail 24/7/365, regardless of whats happening with the economy.
But as everyone knows, reality is different. Companies and the people who manage them tend to become complacent when times are better. Theyre less concerned with how long the air conditioning is on and what the thermostat reads when people go home for the night. Theyre not as likely, perhaps, to market themselves aggressively and remain visible because they believe the business will find them. And theyre not as willing to look at a department or a division and wonder whether it is properly staffed and if the same amount of work can be done with fewer people.
It is when times are tough that people turn over every rock in search of ways to cut expenses and increase revenues. As one restaurateur put it, this is the time for everyone in an operation to think like an owner.
Hes right, of course, but the time for such thinking, for such a mindset, is all the time.
And if area business owners and managers can learn this lesson, then maybe there will be something actually gained from whats being called the Great Recession.
Indeed, newspapers and business magazines often run collections of stories on businesses large and small surviving a recession. They are replete with tales of business leaders being daring and entrepreneurial as they blueprint ways to do what they do better, to reach new audiences, and cultivate new groups of customers.
Add it all up, and it seems that people in business do their best, most creative, thinking when their backs are up against the wall and their survival is quite possibly at stake.
What we hope people take away from these troubling times is that they dont have to wait until trouble strikes to be entrepreneurial or to really think like an owner. If they act in such a manner during all economic seasons, then this region will have better, stronger small businesses and, overall, a much more resilient economic base.
Casino Jobs Aren’t Enough
Last year, House opposition stopped Gov. Patricks proposal to build three resort casinos in Massachusetts. With a worsening fiscal crisis and Speaker Robert DeLeo taking a more casino-friendly stance than his predecessor, the issue is sure to reemerge this fall.
Proponents argue that casinos will add new tax revenue and much-needed jobs a Greater Boston Chamber of Commerce study estimates that three resort casinos would add between 10,000 and 11,500 temporary construction jobs and 17,000 to 21,000 permanent jobs. Opponents cite the societal costs associated with gambling.
Our organizations havent taken a position on casinos. But we believe the much bigger issue is that, while the country added about 25 million jobs over the last two decades, the number of jobs in Massachusetts stayed the same.
Flat job growth is not a strategy for long-term success. Skilled workers have made Massachusetts a leading destination for high-paying jobs. But focusing only on high-end employment is a recipe for disaster, creating a society of haves and have-nots. Broader job growth creates social mobility, encourages affordability, and enhances the regions ability to attract the best talent.
Creating a level playing field should be the foundation of an overall vision for long-term job growth. It begins with streamlining the process for starting a business. Massachusetts must be a destination that holds opportunity for new immigrants and other start-up entrepreneurs, not just the established and affluent. And while Massachusetts will never be inexpensive, costs matter, and there is much that can be done to reduce them.
A 2006 study prepared by Global Insight for Pioneer Institute found that the cost of land was the source of the states high residential and commercial rents, wages, and overall cost of living. The problem often stems from rigid local zoning ordinances that discourage development. In the midst of a deep recession, its easy to lose sight of problems such as the supply of affordable commercial space not keeping up with demand. But over time, this has been a main driver of rising costs, making each new job more expensive to create.
The cost of employer-provided health insurance continues to rise much faster than inflation. The Commonwealths 2006 health care reform law was a first step toward addressing the problem. It has successfully expanded access to health insurance, but a laser-like focus on cost containment will be necessary if it is ultimately to succeed.
Massachusetts cost of electricity, one of the highest in the nation, is also hindering economic growth. With the states reliance on expensive fuels to generate power, escalating costs to replace an aging infrastructure, and the willingness to constantly add surcharges to customer bills to fund unproven renewable technologies and other costly experimental programs, further double-digit rate increases are certain.
Massachusetts employers also pay more than $1.5 billion annually in unemployment insurance taxes double the national average on a per-employee basis. The taxes support a system that offers the richest benefits in the country, and one in which its easier to qualify for benefits and recipients can collect for longer than in other states.
With people hurting across the state, this isnt the time to cut unemployment benefits. But a set of reforms proposed last year by Associated Industries of Massachusetts would have saved $366 million without slashing benefits.
Today, businesses in seasonal industries like construction and tourism routinely lay off the same employees every year, using unemployment benefits as kind of a payroll subsidy. Some small-business owners take advantage of this loophole by laying themselves off and collecting for part of each year. Charging those companies much higher unemployment insurance tax rates would provide a disincentive for bad behavior and lighten the load for companies that arent abusing the system.
Whether to build casinos in Massachusetts is an issue that merits spirited debate. But casinos alone arent nearly enough to make up for the Commonwealths failure to grow jobs. Regardless of how the casino debate turns out, state policymakers should spend far more time and effort on reforms that will spur substantial long-term job growth.
Rick Lord is president and CEO of Associated Industries of Massachusetts. Jim Stergios is executive director of Pioneer Institute.
For Horizons Owner Mark Melikian, the Sky’s the Limit
Mark Melikian says the key to his longevity is fairly simple — giving customers what they want, and at an attractive price.
Mark Melikian has seen a lot of changes come to Wilbraham Road (Route 20) since he opened Horizons Restaurant & Bar on that thoroughfare 22 years ago.
There was much less here then, he said, referring to the stretches both east and west of his establishment and gazing skyward as he tried to recall the landscape in 1988. There was a tennis club back then; now its a soccer center of some kind. There was just one auto dealership; now theres several. And of course Post Office Park (the elaborate business center a mile or so west of Horizons) hadnt been built.
Its getting pretty developed now theres a lot of new businesses, and a lot of new chain restaurants, he continued, noting that the former has helped his enterprise, while the latter he could definitely do without, although he has stood up well to the groundswell of competition.
Thats rather obvious if hes been witness to more than two decades of change and progress on Wilbraham Road when many businesses, not to mention restaurants, have come and gone in that span.
Melikian says he owes his feats of longevity (something fairly rare in this sector) to some basic business principles and some strategic approaches specific to the restaurant industry and the niche he serves. He tries to keep things simple, for example, and focus on what the customers say they want, not what he believes they might want. He keeps his prices reasonable and puts the accent squarely on value.
This approach has kept regulars coming back and a steady stream of newcomers coming to the door, he told BusinessWest, adding that over roughly three decades in the business hes seen a number of business cycles, and the current downturn has been particularly challenging.
This has been going on for two years now, really, he said of what has evolved into what some have dubbed the Great Recession. Its been challenging; were talking about disposable income, and everyone has less of it these days.
In this environment, restaurant owners and managers have to control their spending, become even leaner (restaurants always run lean), and look to create new business opportunities, he said, adding that hes doing all of the above.
For our annual Restaurant Guide, BusinessWest talked with Melikian about Horizons, the restaurant business, surviving a recession, and, in general, what it takes to achieve longevity in this ultra-challenging business.
For Appetizers
Melikian said he took what would have to be considered the road most taken when it comes to restaurant ownership.
He started (where else?) washing dishes at the old Willow Glenn House in East Longmeadow, a restaurant and banquet facility owned by his father and two uncles. He graduated to other kitchen duties involving food preparation, developed that requisite passion for the business, and went to school to hone his skills.
I dont know what possessed me to do it, but I applied to the Culinary Institute of America and got accepted, he joked. I took a sabbatical from college and went off to pursue this; I guess I really knew early on that this is what I wanted to do with my life.
After working as a chef in a number of restaurants, including a few in Florida and New York, Melikian, like most others who start down this road, wanted to run his own restaurant. Actually, this was a dream also shared by his brother, Jeff, so they pursued it together.
With some financial backing from their father, the brothers Melikian acquired the then-closed Top of the Hill Restaurant, a long-time, if at times troubled, fixture on Boston Road in Wilbraham in 1987. They renovated it, renamed it Horizons, and a few years after opening it put on a large expansion (the current bar area).
Jeff, now with Mohegan Sun in Connecticut, left the business several years ago, leaving Mark, now playing the role of chef/owner I supervise everything to cope with the changing scene on Route 20 and an ever-more-competitive business landscape.
Hes fared well by catering to a broad constituency that includes everything from retirees to business professionals living in Wilbraham, East Longmeadow, Longmeadow, Belchertown, Ludlow, and other affluent suburbs east of Springfield.
The former is the bread and butter, if you will, for the luncheon business, while the latter dominates the dinner clientele. Meanwhile, younger audiences find the bar area an attractive spot for watching a ballgame, listening to live music (now featured regularly), and enjoying a good meal.
Such well-roundedness helps Horizons at all times, but especially when the economy is soft, said Melikian, adding that he relies on a steady diet of regulars, but also a constant stream of newcomers. He draws both by keeping the menu, which he described as Creative American, varied, but also dominated by staples such as prime rib cooked on the bone as well as steaks, seafood, and pasta dishes.
And while discussing what has become a recipe for success he almost apologizes for its simplicity.
You just try to do the right thing and treat people right offer quality products at affordable prices, he explained. It sounds mundane, but thats what you have to do; thats what it comes down to.
Elaborating, he said this means listening to customers and responding with what they want. We try to cook the food I think people want to eat, and not necessarily what youd like to do, he explained. Everyone would like to be able to serve a $40 steak, but you have to take what the market gives you.
As for the recession, Melikian speaks for others in the business (actually, they speak for themselves; see related story, page 23) when he says that the key to surviving and thriving is to simply keep an eye on things.
And by that, he means everything from the prices he pays for food and other items to controlling waste to keeping any and all other expenses in check.
Its like any business; you cant control what comes in, he said, referring to the volume of business for a given day, week, or month. But you can control what you spend.
Such steps are necessary, he said, because this recession is more challenging than any hes seen previously (and he lived though the downturn in the early 90s), and people simply dont eat out as much when they have less disposable income or if they are uncertain about the economy and until recently, that meant just about everyone.
People still come in, just not as often, he said. If you used to see them once a week, maybe youll see them once a month now.
To compensate, Horizons is doing more off-site catering, said Melikian, noting that it recently handled a wedding at the Barney Estate in Springfield, one of many such assignments in recent months, and, in general, it is stretching its imagination when it comes to ways to generate additional revenue and reduce expenses.
And thats a challenge, because your fixed expenses have gone up, and you can only charge so much for what you do, he said. You cant say, this steak used to be $15, but now Im going to charge $25 to cover my expenses. Well, you could do that, but no one would eat it.
Instead, you have to find ways to cut back, but not sacrifice quality, the things that make people come to your restaurant in the first place, he continued. Its not complicated, really. You just keep an eye on everything.
Just Desserts
Returning to the matter of chain restaurants proliferating on and around Boston Road, Melikian said hes seen many come and a good number go.
There have been other observations, as well. When one of them opens, you always notice some drop-off in business as people go to check it out, he said. Then, things gradually return to normal, and after their good start, some of the chains slow down, and before long you see their people coming to your door looking for work. Theres a pattern there.
Melikian has stitched his own pattern, one of success and longevity that has made Horizons a true landmark and enabled its owner to be a witness to 22 years of evolution on Route 20 and counting.
George OBrien can be reached at[email protected]
They Make Good Sense for Landlords and Tenants Alike
By now, most people are familiar with the term going green and the concept of green building, but many people may not be familiar with green leasing.
While there is, as yet, no working definition of the term, green leasing generally integrates concepts such as recycling, sustainable-development principles, energy and water conservation, alternative-energy usage, and hazardous materials (usually cleaning materials) use and disposal, with the standard leasing language involving operating expenses, rent structure, and tenant build-out costs.
Most green leases include provisions for the reduction of energy usage through such simple measures as energy-efficient fixtures and equipment, turning off lights, motion sensors, and increased rent for after-hours business operations. These leases also contain clauses requiring recycling programs, sustainable buildout materials, air-quality standards, and reduced water usage.
Just as green leasing lacks a standard definition, there is also no single certification given to identify a lease as a green lease. Instead, there are a number of different certifications that can be attained by builders, developers, and landlords seeking to label leases as green leases. For example, some seek certification pursuant to the Leadership in Environment and Energy Design (LEED) standards set forth by the U.S. Green Building Council, which awards points based on building specifications. In the case of existing buildings, LEED certification for commercial interiors (LEED-CI) is often sought. LEED-CI awards points (a) if the lease is for a term of 10 years or more; (b) if the leased space is located in a LEED-certified building; and (c) if the leased space is located in a building that contains certain green equipment, including but not limited to water- and energy-conservation fixtures.
Another certification sought is Energy Star for commercial buildings, which is a government program administered by the U.S. Environmental Protection Agency and the U.S. Department of Energy. Energy Stars goal is to reduce the use of energy through the use of energy-efficient practices and products. Energy Star also uses a points-based system that awards points on a scale of 1 to 100. Buildings that receive a score of 75 or more receive the Energy Star rating.
So, its logical to conclude that green leasing equates to increased construction and operating costs. While there are without doubt costs associated with green leasing that are not found in traditional leases, if crafted properly, green leases can actually result in an overall increase in net operating income through the inclusion of requirements affecting the use of energy, regardless of prevailing energy prices.
In the context of a net lease arrangement, this can be accomplished through the inclusion of green-building capital expenditures, repairs, and maintenance in the definition of common-area maintenance (CAM) and/or operating expenses. In a gross-lease context, this can be accomplished through the adoption of green rules and regulations that require all tenants to adopt green standards, thereby eliminating the possibility that tenants who have adopted green practices, and therefore incurred such associated costs, are paying a pro-rata share of energy expenses with tenants who have not adopted such practices, and are therefore responsible for a disproportionately large percentage of overall energy consumption.
In addition, more and more companies and government entities are now demanding green lease space. For example, in 2007, the Energy Independence and Security Act of 2007 (EISA) was enacted, which set forth goals and standards for the reduction of energy use in federal buildings (including all buildings in which the federal government leases space), including the use of energy-efficient lighting fixtures and bulbs and a prohibition against federal agencies leasing space in buildings that do not earn an Energy Star label. As such, landlords who seek federal government tenants will be forced to attain Energy Star certification.
Additionally, many companies have enacted sustainability statements that, in addition to other provisions, require that leases entered into by the company contain at least some green language. These mandates, along with a growing and continuing trend toward green building and green initiatives in general, are beginning to force landlords and tenants to rethink lease arrangements in order to meet the goals of both parties.
While green leasing is a relatively new concept, the number of green buildings being built, and the number of companies and government agencies requiring green leases, continue to increase. As with most new concepts, those who lay the groundwork now for preparing and/or negotiating green leases will be well-positioned when this new concept becomes an accepted reality. This positioning requires both landlords and tenants to reconsider the approach the other takes when negotiating lease arrangements.
Dennis G. Egan Jr. is an associate with
the regional law firm Bacon Wilson,
P.C., who specializes in business and
corporate law; (413) 781-0560;[email protected]
The Employment Picture Is Improving, but It Remains Fuzzy
Mary Ellen Scott, left, and Christine Phillips say business is picking up.
The July unemployment numbers released by the U.S. Department of Labor were lower than expected. Thats the good news.
However, the difference between the projected figure and the 9.4% unemployment statistic for that month was a tenth of a percent. Thats not too bad for news these days.
Across the nation in July, employers trimmed 247,000 jobs, in contrast to the staggering January losses of 741,000. On the day the unemployment numbers were released, President Obama said that the worst may be behind us, and that we are pointed in the right direction.
The Bay State posted a seasonally adjusted 8.6% unemployment rate for the month of June, and while there were other Mass. communities that spiked into double digits, Hampden County edged below, at 9.8%.
Thats still a large number, and its reflected in what Rexene Picard, executive director of FutureWorks in Springfield, one of 37 statewide career centers, observes every day. The big thing that were seeing is increased traffic for job seekers. Theres a line out the door when we open. At the same time, we are seeing fewer job opportunities. Our job postings have gone down from this time last year about 38%. Thats a significant drop.
At United Personnel in Springfield, owner Mary Ellen Scott and Executive Vice President Christine Phillips took a positive look at the local job market. Talking about the manufacturing sector, historically one of the backbones of the local economy, Scott said that our business has definitely been picking up over the last few months.
Joe Ascioti, owner of Reliable Temps Inc. in Agawam, feels less buoyant about the governments predictions. While the latest statistics are better than feared, he said, lets face it, we arent creating a lot of new jobs yet. Theres still too much uncertainty out there right now.
In these days of economic turmoil, a reduction in bad news is good news, most would agree. Massachusetts has consistently been at the lower end of the nations unemployment rates, but in talking with area employment professionals, the big question is, when does the good news get good?
Local Looks
While the number of job-seekers and the dearth of jobs Picard sees everyday are both somewhat historic, she is confident in programs that are available for area workers.
Western Mass. is better in some ways than the Boston area because we dont see the highs nor the lows that they do, she said.
Some new growth in the job market comes from familiar sources, she continued. Health care is, and continues to be, the leading source of employment for this area and the state.
Our largest employer in the area is Baystate Medical Center, she continued. They are reaching out to us now, because we know that there is going to be a need to hire around 1,000 people a year for the next several years. Anybody thats thinking about a new career, or switching gears, I encourage them to look at that field.
In the manufacturing and construction sectors, new claims for unemployment in Hampden County totaled more than 3,000, and Picard agreed that the bulk of her June numbers comprised those industries. But with funds from the American Recovery and Reinvestment Act, one of the largest stimulus packages in history, funds have come through the pipeline to address those losses. Picard said shes pleased to see substantial money going into both new training and retraining for the manufacturing base of the area.
But its difficult, she continued, because this money essentially is going to replacement jobs. Not a lot of new companies are moving to the area.
Manufacturing continues to be an important facet to the regional workforce, despite decades of offshore attrition. Picard said that the Regional Employment Board of Hampden County is involved with numerous initiatives to keep people in those positions.
The manufacturing industry constitutes 17% of the area workforce, and those generally are jobs that are well-paying positions, she said. The REB is doing a lot of work in the area with manufacturers, asking where the need is for new employees and what they can do to successfully build pipelines into those industries. Its an aging workforce in many cases.
Phillips and Scott say there are signs of some light at the end of the tunnel for the manufacturing sector, and theyre seeing it in the growing number of positions theyre being hired to help fill.
I dont think we were expecting manufacturing to be doing as well as we have seen already this year, said Scott. Phillips agreed. It has picked up, and it is definitely where we have seen the biggest trend change. We were not anticipating certain clients to have needs this year; our analysis was that we werent planning on having any orders.
The improving picture can be attributed in part to what appears to be greater consumer confidence, as reflected in some of the numbers being posted by retailers, said Phillips.
I think that if you look at certain other sectors, lets say retail, their numbers began the year pretty low, she said. What they predicted for this quarter has been completely surpassed. There was a real concern about what kind of money would be spent. What retailers are seeing is that people are still spending. Thus, analysts look from this time last year to now, and their orders are far greater than they had anticipated.
Phillips and Scott agreed that the numbers these days are not as good as they would like them to be. While some clients are hiring more than they anticipated, many employers are, by and large, holding out for more assurance that the economy will strengthen.
Frankly, said Phillips, Id be more nervous if we were making giant leaps in gains in the economy. It is more-steady gains that build peoples confidence. If it goes up in a sharp increase, people think that it could similarly go down in a sharp decline.
Ascioti told BusinessWest that he sees government forces sometimes playing a contradictory role with regard to the employment picture. Unemployment taxes can be punishing to small business, and that size employer is one that needs to be given more consideration, he maintained.
What Im worried about right now, he said, is where are we going with all this? As the saying goes, Wall Street doesnt like uncertainty; well, neither does small business. Unemployment costs for many businesses are going to go up 30%. For politicians in Boston to think that they can just raise the sales tax, raise the meals tax, raise this, mandate that, and that businesses are just going to sit there and say, oh yeah, no problem. Well just raise our prices well, its not an elastic environment. You cant just do that.
In this area, he said, a lot of what he hears is that business is still off 25% to 30%. We have a couple of clients that are doing better than normal, he said. Are they where they were a year and a half ago? No. Are they better than 80% of what their competition is doing? Yes. But can I pick one specific industry? Unfortunately, no.
Looking at the larger forces of federal and state regulation, Ascioti said, what we need to do right now is bring our costs in line. I wish the government would understand that its small business that creates the jobs in America. If the climate isnt positive for them, its going to be impossible to hire people.
Hire Ground
The day after the newest unemployment figures were released, the New York Times reported that employers are no longer in a panic, and the pressure they felt to get rid of workers in a hurry is diminishing. That seems to be the sentiment in the Pioneer Valley, but the overall employment picture remains fuzzy because there are too many variables to make a clear assessment.
One thing is fairly certain, however: until the economy gains both momentum and sustained stability enough for employers to take on more workers, the only real good news is that the bad news is getting better.
Report Touts Green Building as Economic and Environmental Imperative
Investing in the energy efficiency of buildings represents a powerful and strategic energy and climate solution that, combined with other non-transportation initiatives, could reduce the nations energy consumption by 23% by 2020, save the U.S. economy $1.2 trillion, and reduce greenhouse gas emissions by 1.1 gigatons annually, according to a study released recently by McKinsey & Co., a national management-consulting firm.
This confirms a critical path forward that we have long championed, said Rick Fedrizzi, president, CEO, and founding chairman of the U.S. Green Building Council (USGBC), which co-sponsored the report. Harnessing the engine of green, energy-efficient buildings can cost-effectively drive tremendous improvements in our economy and environment.
Green building can stimulate the economy at a level one and a half times larger than the federal stimulus bill, he added. In terms of climate change, a commitment to energy efficiency would be the equivalent to taking the entire U.S. fleet of passenger cars and light trucks more than 200 million vehicles off the road.
The report provides a detailed assessment of how much the nation can increase energy efficiency in buildings and other non-transportation sectors using existing methods and technologies. A targeted investment of $50 billion a year over 10 years, the report finds, would enable the entirety of those potential savings to be realized. Those reductions in energy use would save the U.S. economy $1.2 trillion, a return on investment of more than 2 to 1.
Furthermore, those investments would generate 900,000 jobs and reduce greenhouse gas emissions by 1.1 gigatons, according to the report, Unlocking Energy Efficiency in the U.S. Economy, which was sponsored by 12 organizations from within both the government and private sector.
McKinseys research finds that a comprehensive strategy, executed at scale, could reduce the annual non-transportation end-use energy consumption analyzed in this report from 36.9 quadrillion BTUs in 2008 to 30.8 quadrillion BTUs in 2020 saving 9.1 quadrillion BTUs relative to a business-as-usual baseline.
Increasing our nations energy efficiency is an economic, environmental, and national security imperative that requires bold public policy, Fedrizzi said. As Congress debates climate-change legislation, these findings make an overwhelming case that we must dramatically strengthen provisions that support and scale green building.
The energy-efficiency potential cited in the report is divided across three sectors of the U.S. economy: industrial (40% of the end-use energy-efficiency potential), residential (35%), and commercial (25%).
Solutions, drawn from proven, piloted, and emerging national and international examples, show that maximizing the energy-efficiency potential from any single opportunity weatherizing homes, utilizing efficient air conditioners, or employing combined heat and power generation requires addressing multiple barriers simultaneously.
By leveraging existing green-building approaches, we have the ability and capacity now to address multiple barriers, and thus generate additional resource efficiencies and cost savings, said Fedrizzi.
Call to Action
The report calls for an integrated national plan guided by five principles:
According to the USGBC, buildings in the U.S. are responsible for 39% of carbon dioxide emissions, 40% of energy consumption, 13% of water consumption, and 15% of GDP per year, making green building a source of significant economic and environmental opportunity. The organization claims that greater building efficiency can meet 85% of future U.S. demand for energy, and a national commitment to green building has the potential to generate 2.5 million American jobs.
In addition to USGBC, the McKinsey report was also sponsored by Austin Energy, the U.S. Department of Energy, DTE Energy, the Energy Foundation, the U.S. Environmental Protection Agency, Exelon Corp., the Natural Resources Defense Council, PG&E Corp., Sempra Energy, the Sea Change Foundation, and Southern Co. To download the report, visitwww.mckinsey.com.
Ashley Katz is communications manager for the U.S. Green Building Council.
Jeff Daigneau Creates a World of Possibilities at Lattitude
Cover
Jeff Daigneau says hes long desired to be a chef/owner, the coveted title that most all those who enter the restaurant business aspire to. After working at several area landmarks, including, most recently, Maxs Tavern, he decided that he didnt just want to be in the kitchen he wanted to be in his kitchen. The story of how he created Lattitude in West Springfield speaks to the myriad challenges and sleepless nights facing those who choose this road.
Jeff Daigneau calls it the itch.
And like many of those who start working in a restaurant, usually washing dishes, at a very young age, he got it big time.
Elaborating, he told BusinessWest that many of those who get exposed to the challenging but intriguing restaurant business early on get drawn into it and make plans to make it a career. From washing dishes, they move on to peeling potatoes, chopping onions, and assorted other duties. Those not intimidated by the long hours, hard work, and industry lifestyle often go to college to learn how to cook Daigneau turned down a full scholarship at Johnson & Wales in Providence to attend a two-year program at the Culinary Institute of America (CIA) in Hyde Park, N.Y., instead and eventually go to work in someones kitchen.
However, if one truly gets the itch, said Daigneau, he or she eventually wants their own kitchen, and if they go down that road, they get everything that comes with those bragging rights, from those long hours to credit card balances with lots of zeros to often-sleepless nights spent wondering how to make ends meet.
Daigneau got all that and much more including the enormous challenge of coping with the Big E, located directly across Memorial Avenue from his establishment (more on that later) when he decided to open Lattitude more than 20 months ago. He has absolutely no regrets, though, and nothing even approaching a second thought about his high-risk entrepreneurial gambit.
Thats because its really a lot of fun, he said, shaking his head for emphasis. I get to have fun every single day.
This fun comes in the form of creativity he can express in myriad ways as he plays out the role of chef/owner, or true chef/owner, as he puts it, explaining that some who put this title on their business card are chefs who own merely a small piece of the restaurant in question. Daigneau, former executive chef at Maxs Tavern in Springfield, owns Lattitude lock, stock, and salad forks, and he has those credit-card balances once soaring above $150,000 but now down to $30,000 or so to prove it.
In that role, Daigneau is, in essence, carrying out the mission that prompted him to choose the name Lattitude, while giving the word an extra t for some flair and to be a little different. Latitudinal lines go around the world, he explained. I try to give people a little flavor of the world.
Elaborating, he says part of that aforementioned mission is to educate his patrons, and he does so by introducing menu items such as true San Francisco cioppino, a bouillabaisse-like dish, and keeping some prices on wine stupidly reasonable to give people a chance to sample various labels.
Overall, his strategy is succeeding. Revenues are running well ahead of projections for where he thought the restaurant would be at this juncture, and the sluggish economy has, in his opinion, been a non-factor, a testament to the fact that hes obviously doing something right.
As for the Big E, well, it was a big part of a first year that Daigneau described as a real learning experience.
That first fair it nearly put us out of business, he explained, noting that the doors had been open only a few months before the start of the expositions 2008 run, and he simply didnt know what to expect in terms of the challenge of luring customers to that stretch of Memorial Avenue for those 17 days in late September.
This year, he says, hell be ready, with a game plan hell pay for his customers parking, for example as well as some aggressive marketing to remind people hes open, and a refined attitude born from last years experiences.
Meanwhile, for the other 49 1/2 weeks of the year and fair time as well the Big E represents opportunity, said Daigneau, one that he intends to fully maximize.
We do very well with a lot of the weekend shows, he explained. The Morgan Horse shows have been really good, but all of them have helped the dog shows, a motorcycle show, even the gun and knife show; someone from Ohio came in for dinner and asked what kind of heat we pack around here.
In this issue, BusinessWest looks at Daigneaus early success recipe, and how his story is typical, albeit with some different wrinkles, of those involving individuals who get that itch.
Entrepreneurial Flavor
Daigneau says he probably wouldnt have his own kitchen or at least not the one he currently patrols were it not for a 57-page business plan he wrote for the restaurant that would become Lattitude.
It was a work in progress for about three years, he said of the document he eventually handed to commercial lending officers at Berkshire Bank in early 2008. It was rock solid, and full of true facts and figures.
Solid enough, apparently, to convince those at Berkshire to write the banks largest restaurant loan to date $400,000 after a few other institutions wouldnt even talk to him. That wasnt enough for Daigneau to get the doors open, actually; he had to start using his credit cards. But it came close, and it exemplified just how different, and compelling, the concept for Lattitude was and is.
Daigneau probably first starting thinking about it when he was washing dishes at a small breakfast place located on the Congamond Lakes in Southwick. This is where the itch first developed. It progressed while Daigneau, an Agawam native, went to work at the Chez Josef banquet house, where he handled a number of duties over a stint that lasted through most of his high school years.
You start out washing dishes everyone does and you realize that what youre doing is kind of cool, he said of how his passion for the business developed and evolved. Soon, youre peeling potatoes and peeling carrots, and you get an itch and thats exactly what it is, an itch.
You initially look around and see what else is going on, and you see the guy at the grill and the woman doing the fries, and you say, Id like to be doing that, he continued. And pretty soon, you end up there because someone doesnt show up for work. Eventually, youre working on the line. By my junior year in high school I had decided that this is what I wanted to do for the rest of my life.
After attending CIA, Daigneau worked in a few restaurants, including Eastside Grill in Northampton and School Street Bistro in Westfield, before eventually landing at Maxs. He started as executive sous chef, was quickly promoted to executive chef, and, in 2007, was tabbed to lead the eaterys catering division.
Daigneau said he enjoyed the work, but kept returning to the notion of running his own establishment, a thought that first entered his head maybe five years ago and never actually left.
I wanted to be able to do what I wanted to do and how I wanted to do it, he told BusinessWest. Its not that I didnt believe in everyone elses way of doing things; owners were always giving me a lot of freedom, but I wanted more. I wanted to be the chef/owner, I wanted that level. Ive had that goal since I was a kid.
He started scouting for suitable sites, and had trouble finding what he was looking for. He said that when he stumbled across space, actually three spaces, in a building on Memorial Avenue that comprised the old Caffeines restaurant and the former home to Kent Pecoy Construction, he knew hed found a home.
I dont know why, I just knew, he explained. I talked to the landlord and signed a lease immediately. I didnt have any money, I didnt have a liquor license, I didnt have anything; I just said, Ill figure it all out later.
And he did.
Salad Days
As he assessed his first 15 or so months in business, Daigneau said most things have gone according to that detailed plan he worked out for the lenders. But not everything, obviously.
The restaurant has become popular with most demographic groups and draws patrons from across a wide geographic radius, he explained. But it has become, somewhat to his surprise, extremely popular with women, a fact he attributes to well-lit parking areas and entrances and a feeling of safety not attainable in many settings.
And then, theres the Big E.
Daigneau said he was caught somewhat off guard last year by the fair, which can be a drain on Memorial Avenue businesses, as he soon learned. Most restaurants in the vicinity of the fairgrounds simply shut down for those 17 days (with most using their real estate to park cars), he explained, adding quickly that he didnt have that option last year and, despite his strong start, doesnt have it this year, either.
Hell be open, but with the understanding that Lattitude will become more of a bar than a restaurant those 17 days, and hell be pouring far more draught beer than specialty martinis. But he wants his regulars and potential first-timers to know hell be open for lunch and dinner.
And despite the solid nature of his business plan and no shortage of confidence in his abilities and business instincts, Daigneau says there was plenty of apprehension in the weeks and months after he opened the doors to Lattitude. I didnt sleep much those first eight months, he said.
Overall, Daigneau says he believes hes planned and guessed right when it came to his menu, basic approach (a heavy emphasis on local, fresh produce) and the general experience he provides.
As for the cuisine, he calls it Global American in another reference to latitude, and says he likes to mix things up, with new offerings regularly on both the lunch and dinner menus, with the former becoming increasingly popular of late with the business crowd. It features everything from a house made mac & cheese to a grilled scallop salad to Asian spiced grilled king salmon.
I didnt want to limit myself on anything, said Daigneau, referring both to whats on the menus and how offerings are prepared. I change the menu almost every day dishes come off, dishes go on. We change all kinds of things because we want to educate people, not intimidate them.
Most all of the items on the menus are prepared or accented with locally grown produce, said Daigneau, adding that hes at Cecci Farms in Feeding Hills every day. A case of tomatoes is $25 there, while I can get one from the wholesaler for $10, but I want the local, he explained. To have a true farm restaurant is a lot of fun.
Theres that word again. Daigneau used it repeatedly in the course of his talk with BusinessWest, and he used it with sincerity, while reiterating, repeatedly, that this business certainly isnt all fun and games.
Check, Please
Daigneau said his father got married a few months ago. It was still another event for which he handled the cooking.
He took the occasion to look through some old photographs and noticed that in practically every one taken over the past decade, he was in a chefs outfit. Recalling the event prompted him to recite something hes probably said hundreds of times in his career: this isnt a life, he said of what its like being at the upper levels of the restaurant business. Its a lifestyle.
It comes to those who get the itch, he continued, adding that few ever regret scratching it, and he certainly doesnt.
After all, how many people get to have fun every single day?
George OBrien can be reached at[email protected]
Employee Free Choice Act Opens Fresh Dialogue on the Future of Labor Unions
Meredith Wise says employers are making a mistake if they underestimate unions.
As Congress gets set to re-open debate on a bill that will streamline the process by which employees unionize a measure opposed by many businesses but supported by elected leaders in this time of economic turmoil there is new discussion about organized labor and the role it will play in the years to come.
Later this year, a bill to be voted on in Congress will have a significant effect upon the American workforce.
The Employee Free Choice Act (EFCA) was originally introduced in February 2007 and gained momentum, but a Republican filibuster kept the bill effectively squashed. In March of this year, Sen. Edward Kennedy and Rep. George Miller of California re-introduced the provision to the 111th Congress.
EFCAs role in the workplace is to streamline the process by which employees unionize their workplace. Key proponents of the bill see this as necessary for workers in a time of financial turmoil. However, businesses from Home Depot to FedEx have reacted strongly against the pending legislation.
While supporters lobby to get some form of the bill passed through Congress, larger questions arise. With such powerful federal assistance to organized labor in America, is it time to re-evaluate the role unions play in the contemporary workforce?
Basically union membership has been declining overall for the past 10 to 15 years, said Meredith Wise, president of the Employers Assoc. of the NorthEast, a membership organization that strives to improve employer-employee relations. One of the reasons why the unions have declined is because their agenda has been legislated.
But Tom Juravich, a professor of Labor Studies at UMass Amherst and former director of the schools Labor Center, disagrees with that basic premise. I think its important to draw the distinction between how unions operate, and the role unions play in this country, with the workforce of Western Europe, he explained.
In contrast with that workforce, which is largely granted much of its benefits and social stability through citizenship, said Juravich, in many ways, the only opportunity an American worker has is through a union card.
With historic change possibly on the docket in Congress, BusinessWest opens a dialogue on what role unions have for the nations workforce, what EFCA will mean, and what the future might hold for organized labor.
The Times They Are a-Changing
Wise said that with all the attention placed on EFCA these days, companies, as well as unions, are focusing more on what role unions play in the workplace and whether theyre going to grow or continue to diminish in membership.
What seems to be happening, she said, is that both companies and unions are in a holding pattern, basically seeing how the legislation fares. The sense had been that, until the EFCA passed or was totally shot down, that the unions wouldnt get active. They wouldnt do more than they typically do, as far as outreach or trying to unionize workplaces, and a lot of employers I think kind of put the urgency to look at their employee relations on the back burner.
The economy being what it is, she continued, business might be saying, my plates full; I just cant worry about the possibility of unionization unless something happens with EFCA. Unions cant come after me anyway, because theres just no money to give increases, people are being laid off unions dont have a platform.
However, quite the opposite of that logic is what appears to be underway. Wise said that over the past several weeks, she sees unions in Western Mass. and Northern Conn. not pulling back, but getting much more active in reaching out to workers. They dont appear to be saying, the economys not good; we shouldnt push, she said.
Rather, unions are reaching out to increasing numbers of workers, but arent filing petition cards with the National Labor Relations Board, said Wise, adding that she is left with questions concerning their intent. Part of what we as an employers association, and what businesses are wondering, is whether the unions are getting active to gather signature cards, and then sit on them for a while with the thought that EFCA is going to pass, or some version of it passes, and then they can present these cards and be recognized? Or are they gathering them and they just havent gotten to enough of a point yet to get an election?
While speculation swirls about EFCA and its fate, there is broader discussion about just how much power unions still possess and what it can or should do with that influence.
While manufacturing has been the traditional base for organized labor, Wise noted that unions have branched out into many different sectors. The public sector, from the federal government on down to town municipalities, represents fully one-third of the organized workforce in the nation, she noted, adding that growth is significant in both human services such as health care and also finance.
The big difference for unions these days, she told BusinessWest, is that goals have changed with the times. I think that one of the main reasons is that, 10 to 15 years ago, unions did a really great job of pushing their agenda into the political arena, said Wise. So there had been a lot of laws and regulations that used to be part of union contracts, but now they are regulated.
These include things like family and medical leave, she continued. At one point in time, something that would have been a big part of the union platform is that you can go out on leave and have your job protected. Well, now that is federally legislated. Thats going to happen regardless if you are union or not.
The Americans with Disabilities Act of 1990 is another example of union success for the workplace at large. I think that the unions have done a pretty good job over time of getting their agendas politicized and put across for all employers to have to do without being unionized.
Juravich agreed that unions message has successfully become part of the American workers rights, union or not. However, he noted that there is still work for unions to do. I still think that what were given by law is minimal when contrasted with other industrial societies, he explained. For example, there is no federally or state mandated right to a lunch hour. So I think that unions still can provide a lot.
EFCA Marks the Spot
Votes for unionization currently take place when 30% of the workers for a given employer agree to sign authorization cards. Those cards are then filed with the NLRB, which then organizes an election for them.
Generally within 60 to 90 days there is a secret-ballot election, where the employees that have been identified as a unit have an opportunity to vote yes or no. Those who originally signed those authorization cards may stick with their original vote of pro-union, or they can decide against it.
If EFCA passes as currently written, there would be no secret-ballot election. If the union voices could get 50% plus one of the workforce originally, the potential bargaining unit that gathered these election cards would present them to both the employer and the NLRB and then theyre in no further election.
EFCA, essentially, seeks to safeguard the jobs of employees seeking to organize their workplace. Juravich explained some of the clear and present dangers with the current process and why the legislation has been filed.
The problem is that, during the days leading up to the election process, what we know is that they are not very democratic, he explained. Employers can do a variety of things to impede the elections. For example, they can bring workers in and meet with them individually for five minutes to three hours to try to dissuade them from voting positively in the election.
There is a statistic that in one out of every three union elections, workers are fired illegally for trying to organize, he continued. That has an incredibly chilling impact, even though those employees might later be hired back.
The possibility for compromise with the EFCA as currently written seems likely, said Wise and Juravich. One of the key revisions already discussed is that the secret-ballot election wouldnt be abolished; it would just take place with an expedited timeline. Instead of the current waiting period of 60 to 90 days, balloting would have to happen within 10 days. Or, if the election were to take place within 10 to 15 days, there are certain things management can or cannot do regarding campaigning against the union.
Labor Daze
While helping employers understand EFCA and potential ramifications, Wise also has some advice for business owners about organized labor in general: Dont underestimate it.
She said the card unions are playing today involves respect, or, more to the point, the lack of it being shown to workers during this economic downturn.
Businesses are very involved right now in keeping themselves afloat, making it through another payday, making it through the year, and they are neglecting to a large extent those employee-relations pieces, she continued. Its an important thing not to say to an employee, youre lucky to have a job, or, no I dont have time to listen to your complaint today, and remember, you have a paycheck. Youre not like the other 10% of the workforce that is unemployed.
Wise noted that unions are a business, and are utilizing sound business models these days. Over the last five to 10 years, the unions have been working so hard at restructuring themselves and re-educating themselves because the workforce that they were accustomed to organizing is no longer the workforce thats out there, she said.
Now, unions are poised to kind of come back, she continued, because they have more technology. Theyve worked really hard at rebuilding their Web sites, updating their methods of communication, and frankly probably done a better job of that than their employers as far as recognizing how tech-savvy a lot of the younger people are, and working that into their campaigns and their outreach.
For Juravich, his contrast with the industrialized societies of Western Europe highlights the discrepancies between the two workforces. As part of the rights one receives there with citizenship, one has the right to earn a living wage, to have health care and pension benefits. Those are their citizenship rights.
In this country, he continued, the laws provide us with minimum wage, no access to health care, no access to pension programs, with the exception of Social Security. Unions are in many ways for American workers to be a part of a society, to have what workers around the world are offered by law.
Speculation on Capitol Hill is that health care is presently on the front burner of Congressional voting, and that EFCA cannot realistically be addressed until at least later this month. Passage of the bill would prove to be a significant victory for organized labor in the U.S., and Wise wants employers to understand the consequences of current actions.
My message is that companies need to open their eyes, she said, and if they dont want that union intervention, they need to stop and look at what their employee relations are.
Thats whats going to help them achieve their corporate goals and expectations, she continued. Unions have played a role in the economy and environment, but I think that businesses can do a better job of achieving their goals of working with their employees without third-party intervention.
Juravich thinks this is a pivotal time for unions. This is without a doubt the most difficult time that workers will face in over three generations, because of the economy. But also this is the most challenging time for unions to be facing in that same time period.
In the industrial sector, he continued, unions have not been able to hold onto their workers. In the auto industry, they are struggling and saying to themselves, how can we still make a difference? Unions have always been about wages, pensions, and health care. But they have also always been about more than just that. In these difficult times its important to remember that unions are also preserving the larger issues of justice and dignity in the workplace.
Ten Points of Joint Tenancy:
By: Todd C. Ratner
Joint tenancy is a form of co-ownership. An advantage is that, when one co-owner dies, the surviving co-owner has instant access to the jointly held property, eliminating the need for probate. However, joint tenancy can have its perils.
| 1 Control Issues. By providing someone with co-ownership, you give them control of your asset. If you add another person as co-owner of your home, you cannot sell or mortgage the home unless that person agrees. |
| 2 Creditor Issues. If creditors seek out your co-owner for outstanding debt owed, the creditors may be able to obtain part of your home or bank account that is held in joint tenancy. |
| 3 Relationship Issues. If you and your co-owner experience a falling out, the co-owner may be able to take all of the money out of the bank account. |
| 4 Substitute for Will Issues. Parents of several children may place one child’s name on an account and assume he will divide assets equally among all siblings. Unfortunately, this method provides no stipulations over control of the money. The surviving co-owner can do with it what he pleases, with no legal obligation. |
| 5 Uncertainty Issues. Unplanned ownership of property often leads to unwanted results, especially for people unable to manage assets. |
| 6 Tax Issues. Careful planning to eliminate or reduce estate taxes can be completely thwarted by a joint tenancy that passes property outright to a surviving joint owner. |
| 7 Long-term Care Issues. Thoughtful planning to reduce long-term care financing can also be thwarted by a joint tenancy that passes property outright to a surviving joint owner. |
| 8 Marriage Issues. Individual property may become marital property once it is transferred into a joint tenancy. |
| 9 Incompetency Issues. If a co-owner becomes incompetent, part of the property may go into a conservatorship, making it burdensome if the other joint tenant wants to sell the jointly held property. |
| 10 Distribution Issues. Joint tenancies deprive you of the flexibility of a will or trust, where you can stagger the distribution ages of the beneficiaries. In a joint-tenancy arrangement, the joint tenant receives the asset all at once. |
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Todd C. Ratner is an estate planning, business, and real-estate attorney with the Springfield-based law firm Bacon Wilson, P.C. He is a member of the National Academy of Elder Law Attorneys; (413) 781-0560; Women in Business Luncheon
Sept. 9: The Berkshire Chamber of Commerce will host a “Celebrating Women in Business” Luncheon from 11:45 a.m. to 1 p.m. at the Berkshire Hills Country Club in Pittsfield. Jane Iredale, president and founder of Iredale Mineral Cosmetics, will be the keynote speaker, while Jessica Layton of NewsChannel 13 will serve as emcee. The public is welcome to attend the event. Admission is $30 for chamber members and $45 for non-members, and includes a plated lunch. To register, call (413) 499-4000, ext. 26, or register online at www.berkshirechamber.com.
Identity Theft Seminars
Sept. 11, Sept. 22, Sept. 23: Representatives of Royal & Klimczuk, LLC, of Northampton and Springfield, will present several informative seminars on revisions to the identity-theft regulations that will impact businesses. The regulations will be effective March 1, 2010, according to the Office of Consumer Affairs and Business Regulation. The most dramatic change to the new regulations is its adoption of a ‘risk-based approach’ to information security. The Sept. 11 seminar is planned in Northampton, while the Sept. 22 seminar is slated in Springfield, and the Sept. 23 seminar is in Westfield. For more information on locations and registration, contact Amy B. Royal, Esq. at (413) 586-2288, or e-mail [email protected].
Family Business Dinner Forum
Sept. 15: For individuals feeling trapped in a family business, a lecture planned by the UMass Family Business Center may be the answer. The lecture will be presented as part of a dinner forum from 5 to 8:30 p.m. at the Clarion Hotel & Conference Center in Northampton. For complete details, visit www.umass.edu/fambiz or call (413) 545-1537.
Rick Thorpe Golf Classic
Sept. 26: The 8th Annual Rick Thorpe Memorial Golf Tournament will be staged at the Country Club of Wilbraham, with the tournament starting at 12:30 p.m. and dinner at 6 p.m. The event, named in honor of Rick Thorpe, who died in the South Tower of the World Trade Center on 9/11, will support the Rick Thorpe Memorial Fund. Two $1,500 scholarships are awarded respectively to graduating male and female seniors from Minnechaug Regional High School. The tournament will be staged a week after the start of the fourth year for Rick’s Place Inc. (also named after Thorpe), which provides a supportive, secure environment where families can remember their loved ones and avoid the sense of isolation that loss can produce. All families with children ages 5-18 who have experienced the loss of a close family member are invited to be a part of this support group free of charge. Children meet in small groups led by trained and supervised adult volunteers in projects, games, and activities meant to facilitate their grieving process. Adult family members meet separately with other caregivers to talk about how to support their children, who may or may not outwardly show their grief. Rick’s Place Inc. is located at Kids Village, 35 Post Office Park, Suite 3514, in Wilbraham. For more information on the golf tournament or Rick’s Place, call (413) 348-3120 or visit www.ricksplacema.org.
Oktoberest
Oct. 14: An After 5 & Tabletop Expo is planned from 4 to 7 p.m. at the MassMutual Center in Springfield, sponsored by the Affiliated Chambers of Commerce of Greater Springfield. Exhibitors are still sought for the business-to-business event. The general price to exhibit is $175, $100 for chamber members. Parking is $5 at the MassMutual Center Garage. General admission is $20 and $10 for Chamber members. For complete details, visit www.myonlinechamber.com.
YPS New Year’s Celebration
Dec. 31: The Young Professional Society of Greater Springfield has once again chosen downtown Springfield for its New Year’s Eve celebration. Only 300 tickets will be available for the affair at the Marriott Hotel in Tower Square. Businesses and individuals interested in sponsorship of the event should visit www.springfieldyps.com for more details. For ticket information, call Jill Monson of YPS at (413) 219-9692.
The following building permits were issued during the month of July 2009.
| AGAWAM Frank Ferrentino Riverbend Medical, LLC Town of Agawam AMHERST Jones Properties, LTD CHICOPEE AHH, Inc. Daniel O’Connell’s Sons Inc. LTL, LLC EAST LONGMEADOW Berg Family Trust Meadowbrook School GREENFIELD Fair Business, LLC Franklin Medical Center Roman Catholic Church Town Of Greenfield HOLYOKE Holyoke Machine Inc O’C Ingleside LLC LUDLOW Big Y Trust | NORTHAMPTON Crocker Building Company Inc. John Scott Sackrey Construction SPRINGFIELD Baystate Medical Center Block Realty Diocese of Springfield Falcon Management Hampden County Physicians Holyname Parish Javal Inc. O’Connell Oil Yellow Brick Property SOUTH HADLEY PVPA School WESTFIELD Berkshire Bank WEST SPRINGFIELD SUK Realty Trust |
Affiliated Chambers of Commerce of Greater Springfield
www.myonlinechamber.com
Sept. 2: ACCGS Breakfast, 7:15 to 9 a.m., hosted by the Log Cabin Banquet and Meeting House in Holyoke. The speaker will be Kevin Rhodes, conductor of the Springfield Symphony. The cost is $20 for members, $30 for non-members.
Sept. 7: ACCGS After 5, 5 to 7 p.m., hosted by Café Lebanon in Springfield. The cost is $10 for members, $20 for non-members.
Sept. 14: Ludlow Golf for Kids, hosted by Ludlow Country Club. Registration and lunch from noon to 1 p.m.; shotgun/four-person scramble at 1 p.m. The cost is $110 per person or $400 for a foursome. Sponsorships are available.
Sept. 22: West of the River Chamber of Commerce Board Meeting, 7:30 to 9 a.m., hosted by Captain Charles Leonard House in Agawam.
Amherst Area Chamber of Commerce
www.amherstarea.com
Sept. 3: UMass/Chamber Community Breakfast, 7:30 to 9 a.m., hosted by the UMass Student Union Ballroom. The cost is $8 for members.
Sept. 9: Chamber Breakfast, 7:30 to 9 a.m., hosted by Courtyard by Marriott, sponsored by Back In Motion, Auto Express, and Summerline Floors. The guest speaker will be Tony Marx. The cost is $12 members and $15 for guests.
Sept. 23: Chamber After Five, 5 to 7 p.m., hosted by the Emily Dickinson Museum, sponsored by Amherst Insurance Agency/The Nathan Agencies. The cost is $5 for members and $10 for guests.
Chicopee Chamber of Commerce
www.chicopeechamber.org
Sept. 16: Salute Breakfast, 7:15 to 9 a.m., hosted by the Log Cabin Banquet & Meeting House. The cost is $18 for members and $25 for non-members. Register online at www.chicopeechamber.org
Franklin County Chamber of Commerce
www.franklincc.org
Visit the chamber online to learn more about upcoming events.
Greater Easthampton Chamber of Commerce
www.easthamptonchamber.org
Sept. 9: Networking by Night Business Card Exchange, 5 to 7 p.m., hosted by Apollo Grill, 116 Pleasant St., Eastworks, Easthampton. Sponsored by Clarke school for the Deaf. Event features door prizes, hors d’ouevres, and a cash bar. Tickets cost $5 for members and $15 for non-members.
Sept. 18 and 19: Electronic Recycling Collection, hosted by Red Rock Shops, College Highway, Rte. 10, Southampton. Sponsored by Duseau Trucking LLC, Autumn Properties, and Greater Easthampton Chamber. Event allows people to responsibly dispose of their old computers, monitors, TVs, stereos, and small home and office appliances.
Greater Holyoke Chamber of Commerce
www.holycham.com
Sept. 16: Greater Holyoke Chamber of Commerce Annual Outing, 5 to 7:30 p.m., hosted by Holyoke Country Club, Country Club Road, Holyoke. Featuring a chance to win $1,000. Tickets cost $25. Call the chamber at (413) 534-3376 for tickets or to become a sponsor, or visit www.holycham.com for more information.
Greater Northampton Chamber of Commerce
www.explorenorthampton.com
Visit the chamber online to learn more about upcoming events.
Quaboag Hills Chamber of Commerce
www.qvcc.biz
Visit the chamber online to learn more about upcoming events.
South Hadley/Granby Chamber Of Commerce
www.shchamber.com
Sept. 22: Premier Beyond Business, 5 to 7 p.m., hosted by the Sycamores. The guest speaker will be Ken Williamson of the South Hadley Historical Society, who will speak on the Sycamores’ history and renovations. Sponsored by Premier members Berkshire Bank, Chicopee Savings Bank, Easthampton Savings Bank, Florence Savings Bank, Jubinville Insurance Group, PeoplesBank, and Private Financial Design. The cost is $10 at the door for chamber members. Reservations are necessary; RSVP at (413) 532-2480 by Sept. 18.
Three Rivers Chamber of Commerce
www.threeriverschamber.org
Visit the chamber online to learn more about upcoming events.
Greater Westfield Chamber of Commerce
www.westfieldbiz.org
Sept. 9: WestNet Opening Networking Evening, 5 to 7 p.m., hosted and sponsored by Nora’s Restaurant, 106 Point Grove Road, Southwick (across from Louie B’s), celebrating its grand opening under new ownership. Attendees are encouraged to bring business cards. Tickets cost $10 for members and $15 for non-members. For reservations, call (413) 568-1618, E-mail marcia@westfieldbiz. org, or sign up at www.westfieldbiz.org.
Sept. 19: 50th Anniversary Celebration of the Greater Westfield Chamber of Commerce, 5 p.m. to midnight, hosted by Tekoa Country Club, Route 20, 459 Russell Road, Westfield. Sponsored by Berkshire Bank. The theme for the evening is ’50s Diner. A Cruise Night will be set up in the parking lot. Bands include the Drifters and Corey and the Knightsmen. Tickets cost $35 through September 13, and $45 thereafter. For reservations, call (413) 568-1618, E-mail [email protected], or sign up at www.westfieldbiz.org.
Sept. 23: Mini Trade Show, 10:30 a.m. to 3 p.m., hosted by Westfield State College, Ely Campus Center, Main Lounge Area, 577 Western Ave., Westfield. The event aims to acquaint the college community, faculty, and students with local businesses and their goods. Call (413) 568-1618 with any questions, or E-mail [email protected].
Young Professional Society of Greater Springfield
www.springfieldyps.com
Sept. 11: United Way’s 16th annual Day of Caring. Each year, more than 1,400 volunteers from 45 companies participate in the Day of Caring, which pairs volunteers with agency service providers to accomplish a variety of projects.YPS will be paired up with Greater Springfield Habitat for Humanity and will be working on one of the homes currently under construction in Springfield.
Sept. 17: Third Thursday, 5 to 7 p.m., hosted by Café Lebanon in Springfield. Relax after work and socialize with other area young professionals.
The following is a compilation of recent lawsuits involving area businesses and organizations. These are strictly allegations that have yet to be proven in a court of law. Readers are advised to contact the parties listed, or the court, for more information concerning the individual claims.
FRANKLIN SUPERIOR COURT
Edward, Mary and Christopher Muenkel v. Greenwood Technologies, LLC
Allegation: Malfunction of wood-burning furnace causing property damage and personal injury: $83,000
Filed: 7/7/09
Theresa Rice v. Deerfield Academy
Allegation: Negligent property maintenance causing injury: $67,500
Filed: 7/10/09
HAMPDEN SUPERIOR COURT
Hallinan Capital Corporation v. Mountain Road Estates and John Hansen
Allegation: Breach of promissory notes: $884,870.63
Filed: 7/13/09
Naismith Memorial Basketball Hall of Fame v. Wazoo Sports Inc.
Allegation: Default of broadcasting rights agreement: $54,500
Filed: 7/9/09
Republic Ironworks Inc. v. Barr Inc. and Travelers Casualty & Surety Co. of America
Allegation: Breach of contract and non-payment of labor, equipment, and materials provided: $42,426.00
Filed: 7/9/09
HAMPSHIRE SUPERIOR COURT
Frank C. Corriveau v. Gentiva Health Services
Allegation: Employment discrimination: $850,883
Filed: 7/15/09
Town of Hatfield v. Mount Vernon Group Inc., Moriece & Gary Inc., and Aquadro & Cerruti Inc.
Allegation: Breach of construction contract for the Dorothy M. Breor Elementary School: $100,000
Filed: 7/15/09
Tyron A. Patruno v. Town of Hadley
Allegation: Breach of employment settlement agreement: $50,000
Filed: 7/15/09
HOLYOKE DISTRICT COURT
Leader Home Center Inc. v. A.R. Green & Son Inc. & Our Lady of the Blessed Sacrament
Allegation: Non-payment of goods sold and delivered: $45,266.17
Filed: 7/3/09
Cook Builders Supply Co. v. Berry Construction
Allegation: Non-payment of goods sold and delivered: $3,305.13
Filed: 7/16/09
NORTHAMPTON DISTRICT COURT
SWB Properties, LLC v. Equity Builders Realty, LLC
Allegation: Breach of purchase-and-sale agreement: $8,750
Filed: 7/13/09
The Darcy Co. v. Northampton Rehabilitation and Nursing Center
Allegation: Non-payment of goods sold and delivered: $4,844.87
Filed: 7/27/09
PALMER DISTRICT COURT
IGM International Granite & Marble Corp. v. Blarney Stone
Allegation: Non-payment of goods sold and delivered: $3,644.33
Filed: 6/25/09
SPRINGFIELD DISTRICT COURT
Comcast Spotlight Inc. v. BMS Paper
Allegation: Non-payment of advertising services provided: $9,896.73
Filed: 7/1/09
Liberty Mutual Insurance Co. v. Rebello Construction Inc.
Allegation: Non-payment of workers’ compensation insurance: $7,307.43
Filed: 7/8/09
WESTFIELD DISTRICT COURT
Berkshire Bank v. Your Cleaning Services and Alena V. Mozolevskaya
Allegation: Non-payment of balance due under credit agreement: $24,940.57
Filed: 6/19/09
The following Business Certificates and Trade Names were issued or renewed during the month of August 2009.
| AGAWAM 365 Degrees Consulting Agawam Landscaping Employee Physicals Service JSC Painting Law Offices of Jeffrey S. Weisser My Tan Factory Quality Inc. and Toner Yan David Landscaping AMHERST Five College Storage Inc. Dunn Et Al Mystery Train Records Panda East Traveling Man Art & Jewelry CHICOPEE DND Construction Elion Construction Plumbers and Pipe Fitters Local 104 EAST LONGMEADOW Benjamin & Bers Premier Choice Realty Rentals GREENFIELD Distefano & Son Stable Needful Things Walgreens Wendy’s HADLEY Riverside Fencing Club HOLYOKE Almonte Market CCO Investment Services Inc. Eddy’s Connection Gene’s Ford & Chevrolet Miracles Sweets LONGMEADOW A2Z Hypnotherapy CCO Investment Services Corp. Maritime Smarts Inc. Redbeard Guitar LUDLOW Birch Pond Farm Mr. Home Northstar Diesel Services Russell’s Automotive & Small Engine Repair Toner Town NORTHAMPTON Hess Express My Taxi Inc. Pizza Amores Sitalab Architecture & Design Tapestry Health The Turn-Around Shop Toe & Soles PALMER Palmer Package Store | Steaming Tender Inc. Teng China Garden U Call We Haul SOUTHWICK Granfield Tree Service Nail Tique Susan’s Sanctuary Bed & Breakfast The Sweet Leaf SPRINGFIELD A2Z Painting Answer Connecticut Baystate Children’s Hospital Beauty World New Beginning Boubacar General Enterprises Bridge Pizza CNEJ Trucking Carol-Ann Boardway’s Shop Clark Administrative Services E & M Concrete Fabulous Ink Famous-N-Broke Felix’s Auto Repair Fidan Express Game World Georgia’s Fashion Glow Commercial Cleaning Gus & Magda Tropical Fish Hair Cuttery WESTFIELD Center City Serv & Muffler Eagle’s Nest Roadside Grill Ergo Home Design For K-9’s and Felines Mokan Floors My Favorite Place Pioneer Valley Property Management Prima Vidya Center Scott’s Medical Billing Stanley Laundromat Steals & Deals Valentine Sign & Design Westfield Equipment Services WEST SPRINGFIELD Adlord AHA Services Applied Software Technologies Hess J. H. Miller Framing & Gallery Inc. Martin’s Upholstery Pat’s Home Maintenance Service St. Ann’s Society Strong Arm Cleaning |
Transforming Young Minds
The Electrical/Robotics Technology Department at Springfield Technical Community recently staged its annual summer robotics camp. Eleven middle-school students from Springfield took part in the two-week camp, which gave them an opportunity to learn about the field and build their own robot. At left, Kamari Long displays his robot, while below, Aailyah Gordon (left) and Daryen Ramsey-Thomas show what their creation can do. Sponsors for the camp again this year included the Hampden County Regional Employment Board and the Black Men of Greater Springfield.
A Cut Above
Paul DiGrigoli, owner of DiGrigoli’s Salons, put his talents on display at a recent trade show of the Affiliated Chambers of Commerce of Greater Springfield, providing free haircuts to attendees. Here, he chats with BusinessWest Sales and Marketing Coordinator Melissa Hallock.
Since President Obama put his American Graduation Initiative a plan to pump $12 billion into the nations community colleges over the next decade on the table, regional and national commentators have hailed the plan as a giant step forward for these important institutions.
Obama has been hailed as a visionary and a president who gets it when it comes to the importance of community colleges in the broad realm of economic development. Meanwhile, the initiative, with grant funds tied to performance specifically with regard to graduation rates is seen as a means to get community colleges focused on results rather than mere enrollment numbers.
Thats what the plan looks like from afar. But when one gets a little closer, it becomes clear that maybe this initiative, usually accompanied by the adjective bold, doesnt really deserve such a descriptor. The money certainly wont hurt every little bit helps at this time of severe state budget cutbacks but it is a far cry from what these schools really need to handle the huge assignment theyve been given: to play a large role in training the next generation of workers for emerging new business sectors.
What the Obama initiative does quite effectively, we believe is at least open a dialogue on community colleges, shed light on some of their unique challenges, and stimulate debate on just what can be done to effectively support these institutions moving forward.
Historically, community colleges, which have been part of the American landscape for just over a century now, have lacked state and federal support, with rare exceptions such as the original GI Bill, passed just after World War II. Perhaps the reasons for this are the role played by the colleges and the constituencies they serve.
In short, community colleges provide education for those who have few, if any, other options for obtaining a degree. They cater to mostly non-traditional students, older individuals who are balancing school, work, and family obligations. Many of these people are the first in their families to go beyond high school.
This is not what elected leaders envision when they think of college, and perhaps thats why community colleges have traditionally been underfunded by state and local governments, at least when compared to four-year schools. But enrollment at the nations community colleges is soaring, in part because of changing demographics new waves of immigrants coming to this country and also because of the economy and the need that many have to improve their job skills to re-enter the workforce.
This surge in enrollment, however, is juxtaposed against dramatic budget turmoil at the state level, especially here in Massachusetts, where cuts have led to budget reductions of 14% or more at area community colleges.
Which brings us to Obamas American Graduation Initiative. It represents a dramatic increase in federal support for community colleges 60% if averaged out over the next decade but to say there are strings attached to the money is a huge understatement.
Indeed, most of that $12 million will be apportioned on the basis of grant applications that link money with graduation-rate performance. While this sounds admirable, it will likely coerce schools into lowering graduations standards, toughening entrance requirements, or both. The often-criticized, deeply misunderstood graduation rates may in fact climb, but at the likely expense of accessibility to higher education which is what community colleges are all about.
While these schools will applaud Obamas actions and gladly pursue the money, they should also press for more substantial, more meaningful, and more consistent federal support of community colleges. Thats what they really need and truly deserve.
Retooling the Medicare/Medicaid Model
National health reform is on a fast track. And most proposals draw heavily on the experiment in Massachusetts, which has led to a phenomenal coverage success. But there is a lesser-known innovation in Massachusetts that may offer greater lessons to our nation in improving health and lowering cost. It is called Senior Care Options, and it targets a population largely ignored by health reform seniors. To understand its novelty, a quick review of Medicare and Medicaid is instructive.
Both public programs are overseen through one federal agency, the Centers for Medicare and Medicaid Services (CMS). Medicare is administered by the federal government and provides health insurance to seniors 65 and older. Medicaid is funded by the states and the federal government, but administered by individual states. It provides insurance to low-income families, disabled individuals, and seniors. Families represent three-quarters of Medicaids enrollment, but only 30% of the costs. Seniors account for much of the rest.
A child on Medicaid costs $1,700 per year. A senior in a nursing home costs $70,000. Herein lies an irony. Medicare was created to provide care for seniors. But that care is putting the greatest pressure on state Medicaid budgets. Why? Medicare does not pay for most long-term care services the most expensive care for this population. And since most seniors cannot afford long-term care, once they become frail they spend down their assets (or previously transferred them to their children) to qualify for Medicaid.
In order to deal with this growing burden, states are investing in innovative community supports and services like home health and personal-care services to keep seniors out of nursing homes. To do this well, a state must effectively manage the entire care for this population. But for the 9 million nationally who are on both Medicaid and Medicare, it is almost impossible to do so. This is because each program operates in its own silo with different rules, providers, and services, resulting in enormous fragmentation and added cost. And this cost is significant. Seniors in this circumstance so-called dual-eligibles account for more than $200 billion in spending per year.
Enter Senior Care Options. Massa-chusetts and CMS entered into a novel experiment in 2004. For dual-eligible seniors, Medicare and Medicaid both provide funding to Senior Care Options organizations, which are responsible for managing all care. The organizations provide care that best meets the needs of individuals without separate funding sources and rules to fragment care. Care is fully coordinated, and patients and their families are actively involved in decisions about their health.
The program has had impressive results. Enrollment in this state now tops 11,000 and has increased each year. (Senior Care Options is not available in all regions of the state, and as a voluntary program does not cover all those eligible.) One recent survey found that customer satisfaction was generally very high. Another showed that those in these organizations entered nursing homes at a rate that was 25% lower than those not in the program.
Senior Care Options teaches that seamless coordination of care is critical to success. Yet, the arcane design of Medicaid and Medicare presents major obstacles. As a result, very few other states have successfully replicated this model, and the care for most dual-eligibles remains largely unintegrated.
As Congress considers a new public plan, shouldnt we better align the public plans that already exist? The Obama administration can reorganize CMS so that it focuses as much on the unique needs of populations as it does on the rules of payment. CMS should create a program integration unit devoted exclusively to breaking down silos between the two programs and working with states to eliminate barriers to seamless care for dual-eligibles. Doing so will go a long way to reducing costs and free up resources for more far-reaching reform.
Douglas S. Brown is senior vice president and general counsel of UMass Memorial Health Care in Worcester and a former state Medicaid director.
Westfield Charts Progress Downtown and in Its Industrial Parks
Lisa McMahon, seen at Westfield’s Farmers Market, says there is a great deal of interest in downtown real estate.
Moving like a freight train.
Thats the speedy-sounding metaphor Westfield Mayor Michael Boulanger used to describe the forces transforming both his citys downtown and overall immediate future. As he delved into the details, the description doesnt seem far off.
A city with a long history evident in three centuries of architecture along its city green, Westfield dates to the 1660s as the westernmost outpost of the Massachusetts Colony. In its heyday, it was a manufacturing center for bricks, cigars, and the buggy whips that give the city its nickname. Today, more than 40,000 people inhabit its 47 square miles, with a median income of around $45,500.
Westfield has long been free from many of the social ills plaguing its regional peers. It boasts steady home prices, a low crime rate, and a solid middle-class population have made the Whip City something of an anomaly in the Pioneer Valley.
While other former mill cities strive to shore up their communities from decades of urban blight, Westfield has its eyes on a larger prize, nothing short of transformation into a destination city, not unlike nearby Northampton. In this latest community profile, BusinessWest talks to some of those people with the lofty, yet very real, goals of making that happen.
Home Court Advantage
Nationwide, economic development has been as stagnant as the summers heat. But Westfield boasts new-business planning that most communities can only dream of. Boulanger sat at the head of his conference table recently to outline the details of that freight train he described.
Contrary to what the Massachusetts economy, or that of the nation, has shown in terms of a lack of growth, well, theres a lot of stuff happening here now, he said. Indeed, there is.
The undeveloped areas of land around Barnes Airport on the north side of the city are proving to be fertile grounds for significant growth. Home Depot had already operated a regional facility in that section of town, but plans are underway for a $25 million rapid-deployment center in Campanelli Industrial Park.
That facility will be the regional distribution facility for all the Home Depots in Eastern New York State, as well as New England, said Boulanger. Thats a 675,000-square foot facility, and that to us is huge.
Not only did Westfield successfully keep the facility within city limits after sites in Connecticut were considered as potential hosts, but officials estimate that 150 new jobs will be added to the citys workforce.
Also scheduled for construction in Campanelli Industrial Park is a $400 million power plant owned by the Pioneer Valley Energy Corp. Boulanger noted that all permitting is in place; phase two of the project, involving gas lines from Southwick, is underway; and the site promises a substantial contribution for the citys tax coffers. Were expecting annual revenues for Westfield to be around $3.2 million, Boulanger said.
Why Westfield? Boulanger was happy to expound on the relative strengths of his community. We had the space available, first and foremost, and not many other places did, really, for facilities of that size, he explained. Weve got the airport right there for corporate needs, were at the axis of highways going north-south and east-west, were close to a major city, Springfield, as well as a commercial airport. In the case of Home Depot, Westfield is centralized for all the facilities for the stores they need to service.
Boulanger noted that new growth is not limited to the industrial park. Barnes & Noble plans to open a 10,000-square-foot facility incorporating a Starbucks café in the city common, with a target date for business beginning in summer 2010. That will be a huge anchor point for other establishments to build off that brand and its presence, he said. The retailers college-bookstore division also signed an agreement in principle with Westfield State College, with business to begin in October of this year at the campus.
In a statement, WSC President Evan Dobelle noted that Barnes & Noble was unanimously recommended to be the schools managing bookseller, adding that they have been highly successful in communities of all sizes.
But the bookstore isnt all that the city and college will be sharing.
Head of the Class
When BusinessWest recently turned its focus on Westfield, the big news was Boulanger and Dobelle agreeing to join forces in using downtown student housing to spur revitalization in the citys center. The two understand that a college community is dependent on both town and gown for reciprocal strength and vitality. Boulanger said that the plan is moving along, and that he couldnt be more pleased.
The college had put out requests for proposals for student quarters in the downtown area a few months ago, he said; that process has closed and is being reviewed by the states Division of Capital Asset Management (DCAM). That office will come out with some decisions on those housing locations in a few weeks, so we can use that as a springboard for other projects in downtown.
Revitalization of downtown is really college-dependent at this point, Boulanger continued, adding that the close partnership with the college is very strong, and I do know that they want to do this as much as we do. This really will serve as the catalyst for commercial and economic growth.
Dobelle is no stranger to town-and-gown collaborations, nor, for that matter, the corner office itself. For two terms back in the early 1970s, he served as mayor of Pittsfield. Since then, he has been president at four different colleges; he became the 19th president of WSC in December 2007. While at Trinity College in Hartford, he successfully led efforts to utilize the schools strengths to strengthen the poor neighborhoods surrounding the school.
Westfield has an affluence that you dont find in a lot of cities, Dobelle told BusinessWest. But the reality is that the dollars spent in Westfield are drawn out of the city because there arent places for that money to be spent here, be it retail or entertainment.
The plan to house students downtown has a definite target date for move-in day for the fall 2010 semester, but Dobelle said it could realistically happen as early as the beginning of next year.
He sees WSC as an anchor tenant for downtown Westfield, and belives that, once people with disposable income start moving into those locations, business can be viable and successful, with a chain reaction taking place whereby the public sector wants to be a part of that vibrant culture. Locally, the turnaround of Northamp-tons downtown in the 1980s and 90s is often cited as an example.
When the Great River Bridge (Elm Street) construction project is completed, the village green is redone, and the infrastructure of the city is repaired in a couple of years, Dobelle hopes that WSC will have proved to be the catalyst for a bustling city center like that of other college towns across the nation. He sees his role as president of a public college having even more of a place in that collaboration.
When a public college is subsidized by the taxpayers, then there is a responsibility, he said. I could build dormitories on the campus and then not pay any taxes. But doing this is a more-responsible way to be respectful of the local property owners and the taxpayers subsidizing our institution.
Home Improvements
When WSC successfully integrates into the citys downtown, it wont be the first agent of change in the historic center.
In the summer of 2006, the wheels were set in motion for the third Business Improvement District in the Commonwealth, located in Westfield. Lisa McMahon is executive director of the WBID, noted that, like other small to mid-size American cities, strip malls took their toll on downtowns economy. The Chamber of Commerce, the business community, and also City Hall agreed that our downtown was not well-represented.
Like most people in the city, McMahon said that the collaboration with WSC puts some planning into a holding pattern. Once DCAM knows where those student-housing units will be, the private sector will follow. More than just director of the BID, McMahon has become a liaison to interested developers.
Ive become a bit of a connector, she said, adding that Im familiar with the real-estate stock in the city, so Ill get calls from people both here and out of the area, saying, Im looking for x square feet, or I need a storefront or a second floor.
Ive walked around downtown with developers from all over, she continued, from Eastern Mass., from New York, who are all interested in downtown; theyre interested in the potential and the possibilities here.
Students feet on the streets translates into consumers with money to spend, and the business community knows that. McMahon said that some of the calls she has been fielding reflect that demographic. We have someone who is interested in opening a fish market, another a clothing store, a chocolatier, all these different people who are really interested and who want to get in on the ground floor here, she said.
In fact, McMahon said the response has been so overwhelming that the WBID has pulled back on its advertising of commercial properties due to the sheer volume of calls.
But the WBID isnt limited in scope to attracting new blood to the city center. During a well-attended Farmers Market, one of the agencys initiatives, McMahon told of what the BID means for the city. Like others of its kind, the agency strives to make the city, in its words, a clean, attractive, safe, well-programmed, and aggressively promoted location in which to live, conduct business, shop, and visit.
From the Farmers Market to concerts on the Green; from holiday lights and decorating vacant storefronts downtown to programs for youths, seniors, free health care, and adult literacy, the WBID has become a one-stop New Deal for Westfield, she said, adding that assistance from the city has been vital to her own successes.
All of these things Summer Sounds, the Farmers Market, and more, we wouldnt be able to do any of them if we didnt have the cooperation of the Parks and Recreation commission, the licensing commission, the City Council, the restaurateurs, she said. Even here, right now, the church across the street gives us their parking lot.
People want to see downtown succeed, she continued. From the Gas & Electric linesmen who help us with lights on the common to the Police Department, everyone pitches in. It would never be able to happen if we didnt have collaborations from everyone in the city. People are community-minded, and they want to see change.
As a benchmark of the WBIDs success, McMahon said a number of properties originally opted out of the BID, but many have since contacted us to say, how do we get in? We want to be part of the BID, we want to be on the Web site, we want to be on the flyers that come out.
Overall, she said the city is responding positively to all that the WBID has done. People stop you on the street and say, we appreciate what you are doing here.
Summing things up, McMahon said the city is in a holding pattern for further development now, but not for long.
In just a few weeks, the first wave of college students will find out their new potential addresses in the city center for next year. From students to the new development that follows, it seems clear that Westfield is cracking the whip anew, and is charting a new course for success.
Some Recent Developments in the Law Bear Watching
Congress continues to pass a variety of new laws, many of which have significant implications for individuals and businesses. What follows is a summary of some key developments enacted during the second quarter of 2009.
Guidance on the Limited Subsidy for COBRA
The American Recovery and Reinvestment Act of 2009 provides a 65% subsidy for COBRA continuation premiums for up to nine months for workers who have been involuntarily terminated, and for their families. This subsidy also applies to health care continuation coverage for small employers if required by states (including Massachusetts, other than employers with fewer than 11 employees).
In most instances, the federal subsidy works as follows: the employer advances the 65% subsidy to the health plan and is reimbursed through a payroll tax credit. To qualify for premium assistance, a worker must be involuntarily terminated between Sept. 1, 2008 and Dec. 31, 2009. The subsidy is not taxable when received, but higher-income recipients those with modified adjusted gross income above $125,000 ($250,000 for joint filers) will have to pay back part or all of it at tax return time. This subsidy has been the subject of much guidance from the IRS, posted at www.irs.gov. This guidance includes the following posts:
In early May, the IRS posted Q & As on its Web site providing additional guidance on recovery of the COBRA premium subsidy by way of a payroll credit claimed on Form 941, and clarifying when the subsidy begins and ends.
Business Cell-phone Substantiation Requirements
An employee may exclude from gross income the business use of an employer-provided cell phone as a working-condition fringe benefit. However, because cell phones are so-called listed property, strict substantiation requirements must be satisfied for business cell-phone usage to qualify for the exclusion. Additionally, any personal usage of an employer-provided cell phone is a taxable fringe benefit. Thus, the current rules require documentation of the business and personal use of the cell phone. The IRS is currently considering three alternative methods to simplify the substantiation requirements applicable to employee usage of employer-provided cell phones: a minimal personal-use method, a safe-harbor substantiation method, and a statistical sampling method (or some combination of the three).
Cash for Clunkers Law
President Obama recently signed legislation into law that gives a cash incentive for individuals and businesses to trade in older gas-guzzling vehicles for new and more fuel-efficient ones. The incentive takes the form of a voucher of $3,500 or $4,500 depending on the type of vehicle traded in and the fuel efficiency of the vehicle purchased. The new vehicle must be purchased between July 1 and Nov. 1, 2009. The vouchers are not treated as gross income for purposes of the Internal Revenue Code (or for federal or state assistance programs).
IRA Rollover Pitfall to Avoid
Subject to certain limited exceptions, withdrawing funds from an IRA before reaching age 59 1/2 triggers a 10% penalty. One way to avoid the penalty is to take a series of substantially equal periodic payments (SOSE or SOSEPP), not less frequently than annually, for the life (or life expectancy) of the IRA owner or the joint lives (or joint life expectancies) of the IRA owner and his designated beneficiary.
The IRS has been fairly unforgiving on inadvertent, good-faith errors with respect to SOSEPPS. In one case, an owner took advantage of this exception, but later moved her IRA funds out of equities and into safer certificates of deposit at another institution after the market soured. In a private ruling, the IRS said that this move triggered the 10% penalty for all years going back to when she started taking the periodic payments. The IRS said that the rollover of the IRA to the new institution was a modification of the periodic payments that triggered imposition of the back penalties under a so-called recapture rule. It was irrelevant that the move was inspired by safety concerns, and that the individual was willing to take the payments out of the new IRA.
The IRS also refused to allow her to correct the situation by placing the funds back into the original IRA. Note, however, that a new private ruling issued on July 17 indirectly calls that conclusion into question. The ruling provides relief where an amount was erroneously rolled over into the IRA from which periodic payments were being taken following a rollover from the original IRA from which the payments commenced. The ruling did not affirmatively address whether the original rollover constituted a modification, but assumed that it did not.
Note also an education exception to this somewhat harsh rule. Another litigated matter involved a taxpayer who took advantage of the SOSEPP exception. She subsequently varied the amount to access additional funds for her sons education. The IRS maintained that this was a modification, triggering the penalty. However, the Tax Court overruled the IRS, holding that there is no penalty because of the exception for IRA funds withdrawn before age 59 1/2 for education, and that the rules allow an individual to qualify for more than one exception at the same time.
Claiming Motor-vehicle Sale-tax Deduction
For 2009, there is a new deduction for state and local sales and excise taxes paid on the purchase of new cars, light trucks, motor homes, and motorcycles after Feb. 16, 2009 and before Jan. 1, 2010. The deduction generally is available regardless of whether you itemize deductions on Schedule A or claim the standard deduction. The deduction is limited to the tax on up to $49,500 of the purchase price of an eligible motor vehicle.
This dollar limitation is imposed on a per-vehicle basis, so taxpayers can deduct taxes on one or more purchases of qualifying motor vehicles, up to the limit on each one.
New Guidance on Life Settlements
The IRS recently lifted some of the uncertainty surrounding life settlements by explaining their tax consequences. Until recently, individuals who no longer needed a life-insurance policy had few options: they could surrender the policy to the issuing insurance company for its cash-surrender value, or they could stop paying the premiums and let the policy lapse. For a term insurance or other policy without cash-surrender value, the only choice was to let the policy lapse.
Now, for some individuals, there is a secondary insurance market in which they may be able to sell a policy for more than its cash-surrender value or even sell a policy without cash-surrender value, such as a term policy. These transactions are called life settlements.
This is an important development for anyone contemplating a life settlement because they will now be in a position to gauge how much they will be left with after tax once they reach an agreement on the settlement amount and fees.
Brenda Doherty is a partner with the Springfield-based firm Doherty, Wallace, Pillsbury, & Murphy P.C. She practices in the areas of corporate law, estate planning, and taxation; (413) 733-3111.
Athletic Training Profession Grows in Popularity — and Responsibilities
Susan Guyer, left, and Tracey Dexter Matthews have seen interest in their profession steadily increase.
Susan Guyer says that many of those who enroll in Springfield Colleges four-year Athletic Training program do so with visions of working for the Boston Red Sox some day.
Thats why she gives her students and those thinking about becoming her students what she calls a reality check. It comes in the form of hard statistics, and specifically the one about how fewer than 1% of the athletic trainers currently employed across the country are on the payrolls of top-level professional sports teams.
This doesnt seem to faze many of these individuals, nor should it, said Guyer, assistant professor of Athletic Training at SC. For starters, some of those who enroll in this program may very well become part of that small percentage; several of its graduates are now with major league teams, including Jim Rowe, head trainer with the Red Sox, and Barry Weinberg, head athletic trainer with the St. Louis Cardinals, among others. But more to the point, those who choose this program are drawn by an intriguing mix of medicine and sports, she explained, and most of them of them would be content no matter where they landed.
And there are many possible destinations, from those aforementioned pro sports teams to colleges and high schools; from clinical settings such as physical therapy centers to military units. There are now more than 32,000 people making a living as athletic trainers, and that number grows every year, said Tracey Dexter Matthews, associate professor of Research & Statis-tics at SC.
Thats because the need is escalating, she said, continuing a pattern that started more than 50 years ago. Indeed, there were only a few hundred athletic trainers in the late 50s, and just a few thousand when Springfield College created its program one of the first in the country and still one of the largest in 1975.
The profession, and programs to train those who want to enter it, have come a long way over the past 34 years, said Guyer, but progress has been slow to come in some areas, starting with the matter of identity.
Sometimes our name doesnt clearly depict what we do; I was on a plane the other day, and when I told the person sitting next me I was an athletic trainer, she said, can you help me get fit? said Guyer, citing the confusion between this profession and that of fitness, or personal, trainer. Its been a problem for a long time, but whenever we discuss a possible new name, no one can come up with one that works.
Meanwhile, salaries remain at levels below what those inside and outside the profession think they are or should be, although some improvement has been recorded. Those working at high schools usually earn in the mid-40s, said Dexter Matthews, while those with small, private colleges actually make considerably less, and the average salary for those working in professional baseball (all levels included) is still in the low 30s.
At the top rung, however, the salary, benefits, perks, and other rewards can be substantial, Guyer continued, noting that trainers can earn bonuses, royalties, and even World Series and league championship shares and rings, as Rowe and Weinberg have.
Salary has been a battle theyre not where we want them yet, said Guyer. But the numbers are improving; every time I look at the statistics, I get a little more encouraged.
And there remain some glass ceilings, Guyer continued, noting that there are hardly any women working at the top rung of professional sports the NFL boasts one female assistant athletic trainer, with the Pittsburgh Steelers, for example although she believes there will be a breakthrough, and soon.
Someones going to bust through the barrier; things are improving on many different levels, she said, adding that interest in the program and the profession has remained steady and strong over the years. As for the salaries its not about money for these individuals; its a passion for being involved with athletes.
Field of Dreams
When asked if there was a standard profile for students who enroll in SCs program, Guyer said theres nothing, really, beyond that aforementioned attraction to both sports and medicine, although the number of women getting involved is climbing. Indeed, for the first time last year, more than half of those enrolled in programs nationwide 51%, to be specific were women.
But there are some personality traits shared by most students, she added quickly, noting that anyone who doesnt like the sight of blood should look in another direction, career-wise. And, overall, a strong stomach is a prerequisite.
These are people who will look at the YouTube video of [former Washington Redskins quarterback] Joe Theismann getting his leg broken [the gruesome injury suffered in a 1985 game against the New York Giants] and watch it over and over and over again, she said. Theyll look at the tape, watch and learn, and say, thats a good knee injury, if you should be calling it that.
Dissecting such video is a small part of the process of learning the athletic trainers main duties to treat, rehabilitate, and diagnose injuries and illnesses, Guyer continued, adding that, while the place of employment may vary from a local high school to a pro hockey team, the basic job description is essentially the same.
But its a role that has evolved over the years, she said, adding that new responsibilities have been added as medicine, society, and attitudes about fitness and exercise have changed.
To help explain it, Guyer used her own work as a trainer for SCs womens basketball team, and a season in that life, as an example. She said her work starts long before the first jump ball of the season, with thorough evaluations of each player.
I will check each one of them in a preventative strategy before the season starts, so we play a huge role in prevention, she told BusinessWest. We do height, weight, blood pressure, pulse; we do orthopedic screening, and we do overhead-squat screenings to see if they have any weaknesses or any limitations in motion. We do a full health history screeing and go through it to see if there are any red flags do they have a history of concussion? do they have diabetes? Are they an individual thats asthmatic? What medications are they on?
So we know a lot about this individual before they even step onto the court, she continued, adding that, once the practice or a game begins, shes also the first one on the scene if theres an injury, such as a sprained ankle.
In such a scenario, the athletic trainer will check out said ankle, diagnose the problem, treat it, and monitor the situation. Im going to choose whatever modality I want, she explained, whether its ice and ultrasound progressing to heat and laser-light therapy. Im going to be doing all the rehabilitation, so Im going to get the range of motion back, and the strength back, and the balance back.
And he or she also makes the decision about if and when the player is ready to return to the court (except in matters involving head injuries).
Its the trainers decision, she said, noting quickly that this responsibility will sometimes, and perhaps often, lead to disagreements with coaches and the injured players in question. This explains another of the skill sets expected, if not required, of graduates the ability to effectively communicate with a host of constituencies, even the parents of players.
And theres more, Guyer continued, noting what she called a psychosocial element of the equation. Indeed, the athletic trainer is expected to help individuals cope with personal problems, common colds, and even eating disorders.
The breadth and depth of the job description can be gathered from the list of foundational and professional courses students must take over their four years. The subject matter includes human anatomy, kinesiology and biomechanics, nutrition, acute care of injury and illness, risk management and injury/illness prevention, health care administration, therapeutic modalities, and psychosocial intervention and referral.
In addition to work in the classroom, students must also complete field work TO gain hands-on experience. These are undertaken at area high schools, including Central in Springfield, Agawam, South-wick, and many others, and several colleges, including SC and UMass Amherst.
This combination of classroom and field work has the graduate ready for many of the possible destinations for athletic trainers, said Dexter Matthews, noting that most all seniors who want to enter the field have jobs long before commencement, but many choose to go on to masters degrees that could open more doors.
Thats a Wrap
Summing up the realm of the athletic trainer and its popularity, Guyer said simply, we deal with healthy people who have had an injury.
This helps explain why this profession is more popular than some in the broad spectrum of health care, and why there has been a steady stream of interest in programs like that at Springfield College, even though the odds are very long that graduates will ever trot of the Red Sox dugout to check on Jacoby Ellsburys status after hes had an encounter with the center-field wall.
If you have a student whos looking at a college, and they like sport, and they like medicine, this is a perfect combination, she explained. If you go into another profession, youre not guaranteed to work with a physically active population that has few, if any, outside problems, like stroke.
In other words, its enjoyable, rewarding work, even if you never get to take home a World Series ring.
George OBrien can be reached at
