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President Biden’s COVID-19 Action Plan

President Biden has issued a comprehensive plan that orders employers with 100 or more employees to mandate vaccination for their workers and requires other groups of employers to do the same. The clock is ticking on these orders, and there are many unanswered questions as well as lawsuits filed. Here’s what business owners and managers need to know.

By Marylou Fabbo, Esq. and John S. Gannon, Esq.

 

Last month, President Biden issued a bold new action plan aimed at attacking COVID-19 and fighting the dangerous Delta variant. The plan orders employers with 100 or more employees to mandate that their workers get vaccinated. Similarly, the president’s plan requires the following groups of employees to be vaccinated: those working on federal government contracts (or subcontracts), healthcare workers, and federal government workers.

Not surprisingly, many businesses and politicians are unhappy with these mandates, and one state has already filed a lawsuit against the Biden administration challenging the plan and asking the court to declare it unconstitutional. Here are some takeaways for businesses as they prepare for the novel vaccine mandate.

 

Biden Administration Mandates Vaccinations

On Sept. 9, the president announced steps that his administration is taking to boost the economy by reducing the spread of COVID-19. One step is called “Path Out of the Pandemic: President Biden’s COVID-19 Action Plan” (more information can be found at www.whitehouse.gov/covidplan).

Marylou Fabbo

Marylou Fabbo

John S. Gannon

John S. Gannon

The action plan directs the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) to issue an emergency temporary standard (ETS) that requires all employers with 100 or more employees to ensure their workers are either fully vaccinated or get tested weekly for COVID-19. Employers will also be required to provide paid time off to employees to get vaccinated and recover from any side effects from the vaccine.

The Biden administration estimates this will impact more than 80 million workers in private-sector businesses. Employers that fail to comply with the ETS will face enforcement actions from OSHA, which may include fines up to $13,653 per violation. So, if a workforce with 100 or more employees has 10 unvaccinated workers who are not testing weekly for COVID-19, the business could be looking at a fine of well over $100,000. This is no slap on the wrist.

Additionally, the president signed two executive orders requiring federal employees and federal contractors (and subcontractors) to get vaccinated, regardless of employee size. There is no weekly testing exception for these employees. Employees working on or in connection with a federal contract, including subcontractors, must be fully vaccinated by Dec. 8.

Employees who cannot get vaccinated due to a sincerely held religious belief or disability may be entitled to an accommodation from these requirements. However, it is up to the employer to determine whether medical and/or religious exceptions are legally permissible.

Unfortunately, there are a lot of unanswered questions out there. For instance, who will pay for the testing and vaccinations — the employer or the employee? And if an employee decides to opt for the weekly testing option, is the time spent traveling to and from the vaccination site considered hours worked for payroll purposes? What about the time taking the test? Under Massachusetts law, there appears to be an argument that this is, indeed, time worked for wage-and-hour purposes. Also, will employers who pay for testing be eligible for some sort of tax break if this needs to be paid time? Stay tuned, as we expect more guidance on these topics.

 

When Can Employers Expect the OSHA Standard to Be Issued?

Right now, this is anyone’s best guess. It has been about a month since President Biden announced his action plan. Assuming OSHA has been working on the ETS for a few weeks now, we anticipate it will be released sometime next month, and almost certainly before the end of 2021. Once the ETS is released, employers will likely have a short window (maybe 30 or 45 days) to get into compliance.

 

What Should Employers Do Now?

Business with employees working on federal contracts or subcontracts need to act right away if they have not started taking steps to ensure compliance. The Dec. 8 deadline for federal contractors is not that far away, and anyone who takes a vaccine that requires two shots (i.e., a Pfizer-BioNTech or Moderna COVID-19 vaccine) needs to await several weeks after the first shot to get the second. And full vaccination, regardless of whether it’s a one-dose or two-dose vaccine, is not achieved until two weeks after the final dose.

We suggest that businesses with 100 or more employees put their workforce on notice soon that the OSHA emergency standard will require everyone to get vaccinated. Businesses need to gauge how challenging compliance might be if and when the mandate goes into effect.

If your workforce population is around 80% or 90% (or higher) fully vaccinated, compliance might not be daunting. If your rates are closer to 50% or 60% (or lower), you need to start thinking about implementing the mandate soon, and planning for weekly testing options now. You also want to give employees a head start if they need to raise medical or religious objections to vaccination. Employers should have medical and religious exemption forms on file to provide to provide to employees who raise objections.

 

Legal Challenges

As mentioned above, one state has already challenged the Biden vaccination plan in a legal forum. The state of Arizona filed a lawsuit last month asking a federal court in Arizona to declare the vaccine mandates unconstitutional. The lawsuit contends that the Biden administration does not have authority under the U.S. Constitution to require vaccines.

Similar challenges to past emergency OSHA standards have had mixed results. The legal standard is high: OSHA must demonstrate that workers are in “grave danger” to justify issuing emergency temporary standards. With global COVID-19 deaths recently hitting 5 million, it seems to these authors that OSHA will be able to satisfy the ‘grave danger’ standard.

 

Marylou Fabbo and John Gannon are attorneys at the firm Skoler, Abbott & Presser, P.C., in Springfield, who both specialize in employment law and regularly counsel employers on compliance with state and federal law; (413) 737-4753; [email protected]; [email protected]

Community Spotlight

Community Spotlight

By Mark Morris

Mayor Thomas Bernard

Mayor Thomas Bernard is gratified to see events like the FreshGrass Festival and the Fall Foliage Parade return to North Adams.

While North Adams tries to return to familiar norms, many are prepared to adjust if new pandemic concerns arise.

That’s the perspective of Mayor Thomas Bernard, anyway, who said his community has slowly and cautiously taken steps to bring back the positive routines of daily life.

“The moment that stands out for me is our first concert at Windsor Lake in early to mid-June,” Bernard said. “There were people who hadn’t seen neighbors and friends for more than a year. The sound of kids laughing and playing, great music, the spirit was unbelievable.”

More recently, he pointed to MASS MoCA’s FreshGrass Festival in September as an example of holding a popular event and exercising caution, as attendees had to show proof of vaccination or a negative COVID-19 test before entering.

“Returning to these events is the fulfillment of the promise we made to each other when things were shutting down — that we would be back,” Bernard said.

Though no one can predict what the future holds, Nico Dery said North Adams businesses are prepared to make a quick pivot if necessary.

“Businesses now have COVID plans in place that were developed from an entire season of figuring out what worked and what didn’t,” said Dery, business development coordinator for the North Adams Chamber of Commerce.

The city was the site for a robust vaccination effort that began in January and ran through June, during which time volunteers at the Northern Berkshire regional vaccination center held 40 clinics and administered nearly 25,000 vaccines to residents.

Right now, the vaccination rate in North Adams is around 65%, but that percentage does not reflect a fair number of residents who received their vaccine in Vermont or New York, the mayor pointed out. With North Adams located in the northwest corner of the state, the borders to both adjacent states are easily accessible.

“However you figure it, I’m not going to be happy until the numbers get above 80%,” he added.

“I’m optimistic and believe we’re going to have a great foliage season. Many businesses I’ve spoken with are preparing for lots of visitors this fall.”

Members of the regional emergency-planning committee who ran the COVID-19 operations center were honored at the 65th annual Fall Foliage Parade on Oct. 3.

“Everyone who was involved in the public-health response and the vaccination efforts are the folks who will be celebrated and honored as a sign of how far we have come,” Bernard said the week before the event — and a year after the parade was cancelled due to the coronavirus.

“The theme of this year’s parade was “Games, Movies, Takeout” — “everything that kept many of us going during the darkest times of the pandemic,” the mayor added.

 

No Summertime Blues

Businesses in North Adams experienced what Dery called a “great summer,” with lots of visitors exploring the Berkshires.

“In the past, we had seen many people come here from New York City, but because of COVID, we’ve seen a big increase of people from the Boston metro area,” she noted, crediting the increased visitor traffic to people choosing to forgo a European or cross-country vacation and instead stay closer to home.

Emilee Yawn and Bonnie Marks, co-owners of the Plant Connector

Emilee Yawn and Bonnie Marks, co-owners of the Plant Connector, recently shared this photo on social media depicting their opening day last fall.

“I’m optimistic and believe we’re going to have a great foliage season,” she added. “Many businesses I’ve spoken with are preparing for lots of visitors this fall.”

North Adams has also seen a number of businesses open during the pandemic. Bernard pointed to the Clear Sky Cannabis dispensary, which opened in March, and the Bear and Bee Bookshop in June.

The Plant Connector opened in September 2020 before vaccines were available. Emilee Yawn, a co-owner of the shop, heard from naysayers who said North Adams was a tourist destination and, since there were no tourists during the pandemic, no one would come in.

However, “from the moment we opened, we’ve been bustling,” she said. “I had been growing plants in my one-bedroom apartment, and in no time, we had sold 120 plants. We had to quickly find a wholesaler and become a real business.”

Yawn and co-owner Bonnie Marks met at Jacob’s Pillow Dance Festival, where Yawn was office manager and Marks was a bookkeeper. When Yawn was laid off at the beginning of the pandemic, the idea of a store to promote their mutual passion for plants became more real.

Recently celebrating the first anniversary of the Plant Connector, Yawn noted that, since the opening, more than 6,700 people have walked through the door, and they’ve been averaging around 800 people a month — not bad for a 400-square-foot space.

While they have a website and have recently sold plants to customers in New Jersey, nearly 90% of their sales are from local people in the Berkshires.

North Adams at a Glance

Year Incorporated: 1878
Population: 13,708
Area: 20.6 square miles
County: Berkshire
Residential Tax Rate: $18.64
Commercial Tax Rate: $39.83
Median Household Income: $35,020
Family Household Income: $57,522
Type of government: Mayor; City Council
Largest Employers: BFAIR Inc.; Massachusetts College of Liberal Arts
* Latest information available

“We feel very supported by the community,” Yawn said. “North Adams is a special place; I’ve never felt connected to so many awesome people.”

As the weather starts getting cooler, business is picking up, and Yawn is looking forward to leaf peepers drawn to the Mohawk Trail and surrounding areas. “We’re excited for them to come peep around our shop,” she added.

Businesses in North Adams are also gearing up for the holiday season and what’s known as Plaid Friday. The North Adams Chamber promotes this annual effort with posters and through social media to businesses throughout the Northern Berkshires.

“We started this initiative to encourage people to spend money in their communities on the day after Thanksgiving instead of going to the big-box stores,” Dery said. “Many retailers will run Plaid Friday all that weekend.”

Similar to most communities, hiring in North Adams, particularly in restaurants, remains a challenge. So far, many restaurants are operating at reduced hours to retain staff and prevent burnout.

“This upcoming winter will be interesting because many people are thinking outside the box on how to best manage this,” Dery said.

 

The Next Phase

Bernard will also have an interesting winter after deciding not to run again for mayor. On the job since 2018, he called his time in office a “privilege of a lifetime, to serve North Adams, the community where I grew up.”

He looks forward to an historic election as voters will choose the first woman mayor in the city’s history. The two candidates who emerged from the runoff election, Jennifer Macksey and Lynette Bond, will face each other in the mayor’s race in November.

Bernard said he is still exploring the next move in his career. “I’m asked so often about my future plans, I feel like a senior in college,” he said with a laugh.

As she reflected on the success of the Plant Connector, Yawn admitted she thought the store would flop and she would have to sell plants on eBay and Etsy to survive. Shortly after opening, however, she saw they had something special there.

“I always say this about North Adams,” Yawn said. “This city chooses its people, and people don’t choose it. That’s why there’s a high concentration of awesome people here.”

Law

Discipline for Social-media Speech

By Kevin Maynard

 

In any given week, a news outlet or website will spotlight an employee being suspended or fired by an employer for a social-media post. These posts range from expressions of political sentiments and individual beliefs to commentary on the employee’s workplace or even the employer itself.

With the prevalence of social media in the daily lives of most individuals, employers are increasingly disciplining their employees for off-duty social-media posting, and employees are pushing back with legal actions.

In the resulting legal disputes, employees often mistakenly believe that the First Amendment protects all in-person and online speech. In reality, the First Amendment’s free-speech protection is limited to protection against government action. While public employers have a First Amendment obligation to respect some of their employees’ speech, private individuals and employers generally have no such constitutional obligation.

 

Public Employee Speech

Generally, a public employee’s speech is protected when it relates to a matter of public concern or importance. However, this is not an absolute, and a court must balance an employee’s right to free speech against an employer’s interest in an efficient, disruption-free workplace.

For example, a public-school teacher brought a lawsuit against her school district after being fired for making negative blog posts regarding supervisors, union representatives, and fellow teachers. In upholding the termination of employment, the Court of Appeals in the Ninth Circuit ultimately held that the blog posts harmed the Washington State public-school district’s legitimate interest in the efficient operation of its workplace because other teachers refused to work with the former teacher, and the termination was, therefore, appropriate.

Kevin Maynard

Kevin Maynard

“In the resulting legal disputes, employees often mistakenly believe that the First Amendment protects all in-person and online speech. In reality, the First Amendment’s free-speech protection is limited to protection against government action.”

Earlier this year, a public-school teacher in Fall River was fired for posting allegedly political and racist comments on social media. The teacher filed a lawsuit in Massachusetts federal court, claiming the city did not have “good cause” to terminate her employment and that her teachers’ union breached its duty of fair representation by not providing her any representation following the termination of her employment. An arbitrator to whom the matter was referred by agreement has reportedly found in the teacher’s favor, ordering reinstatement to her position and payment of all back wages. According to her attorney, the teacher intends to sue for retaliation and defamation.

 

Private Employee Speech

Unlike in the public sector, the First Amendment generally does not apply to the actions of private employers. However, private employers even in a non-union setting must be compliant with the National Labor Relations Act, which gives private employees the right to engage in “concerted activities” for the purposes of collective bargaining.

Examples of concerted activities include an employee talking with co-workers about working conditions, circulating a petition about improving working conditions, or joining with co-workers to talk directly to their employer. Regardless of whether the concerted activity occurs in person or over social media, an employer cannot interfere with such an activity taking place during or after work hours. Beyond this concerted-activity issue, the concepts of ‘at-will employment,’ ‘good cause’ for termination, or other common law or contractual issues may be relevant.

 

State-specific Protection for Lawful Off-duty Activity

Some states have laws that protect lawful off-duty activities of both public and private employees. In Colorado, an airport-operations supervisor was terminated for posts on her Facebook page regarding her support for preserving the ‘Rebels’ mascot of her high school, particularly one post that depicted the mascot with the Confederate flag.

A Colorado court vacated her termination of employment because it violated a Colorado statute making it unlawful to terminate an employee for engaging in a lawful activity outside of work. California, Louisiana, New York, and North Dakota have similar laws prohibiting employers from taking adverse employment actions based on lawful off-duty activities. Massachusetts has not enacted such a law.

 

Advice for Employers

Employers may choose to adopt social-media policies that address off-duty conduct. Anti-harassment and anti-discrimination policies should also address off-duty social-media activity. Any social-media policies should be enforced reliably to ensure the consistent treatment of employees.

In enforcing a social-media policy, employers must assess the effects of an employee’s social-media post on a workplace, including its impact on the ability of employees to work with one another. Social-media policies can be a helpful way for employers to set clear expectations regarding the standard of online conduct they expect of employees. The absence of such a policy can make the results of an employee’s challenge to an employer’s disciplinary action for inappropriate social-media posts much more unpredictable.

 

Kevin Maynard is an employment law and litigation partner at Bulkley Richardson; (413) 272-6200.

Law

Remodeling Woes

Joshua L. Woods, Esq.

 

Many of us love watching home renovations on television. Whether the redos are taking place at a beach-house bungalow, a tiny apartment, or a Victorian mansion, it’s always entertaining to live vicariously through people remodeling a house or building their dream home.

But what happens when opportunity knocks in real life, and you have the chance to create a space of your own design? Perhaps you envision a beautiful, blue-tiled backsplash against white kitchen cabinets, heated bathroom floors, or a cozy living room with a gas fireplace. With a reliable and trustworthy contractor, all things are possible.

Unfortunately, not all contractors are reliable and trustworthy. Someone close to me recently experienced firsthand the horrors of hiring the wrong renovation company. My friends lived to tell the tale, but along the way, their family suffered through considerable delays, shoddy work resulting in added expenses and additional repairs, and the all-consuming worry of working with an uncommunicative contractor. Here is the story of a ‘craftsman’ remodeling company whose primary craft proved to be collecting payments for unperformed work.

It all began when my friends, first-time homebuyers, hired a local contracting company to perform a complete restoration and remodel of a charming 1930s colonial-style house. After interviewing five separate contractors, my friends decided to work with ‘Craftsmen’ (the company’s name has been changed to protect their anonymity). The contractor was extremely charismatic, proposed a comparable bid, and seemed to have just the right can-do attitude needed to complete the project. Craftsmen provided three references who, when contacted, sang the company’s praises. Craftsmen also had great online reviews. My friends decided to move forward and agreed to the terms of a proposal from Craftsmen, officially hiring the company for their project.

Joshua L. Woods

Joshua L. Woods

“They had to live through an enormous amount of stress, the upheaval of an unfinished living space, hideously long delays, and considerable additional expenses. You can learn from their mishaps.”

Craftsmen requested a down payment, and upon receiving the funds, the first step of the project — demolition — was scheduled. Pursuant to the payment schedule on the written proposal, the second payment would be due on demolition day, the third would be due when rough plumbing was installed, the fourth upon installation of rough electrical, the fifth upon installation of drywall, and the sixth and final payment would be due when the project was completed.

To their chagrin, my friends soon discovered the problem with this payment schedule: the majority of the fees would be paid prior to the rebuilding. That is, four hefty payments were required before the demolished spaces would be fully rebuilt.

At first, the contractor completed the demo work on schedule, but then they went silent. The house sat in disarray, unfinished, for months after the first payments were made. Nothing was accomplished properly. The plumbing was installed incorrectly, there was an old toilet left in the dining room for months, the trim was unfinished, the hardwood floors were ruined, exposed electrical wires dangled from the walls, and the list went on. My friends finally decided they could no longer tolerate the situation and made the decision to fire Craftsmen.

For anyone considering renovations, keep the following steps in mind, which can help protect you from a similar experience:

• Verify the contractor is in good standing. Ask for the contractor’s business-license number and research it on the state’s website to ensure there are no lawsuits against the company. You should also search the Better Business Bureau for complaints.

• Look into the contractor’s partners and vendors. Request a copy of the business license for all subcontractors who may work on your project.

• Contact references. Before hiring a contractor, always ask for multiple references and contact as many as you can. Listen closely to what they say. When speaking with references, you will certainly wish to inquire about the ‘big stuff,’ including satisfaction with the final project and pricing, but it may also be wise to inquire about smaller details including punctuality, cleanliness on the job site, responsiveness to calls and requests, etc. Looking back, my friend should perhaps have seen a red flag when Craftsmen provided only three references. A reputable company should be able to provide evidence of a great many satisfied customers.

• Have an attorney review the fine print. Another red flag should have been the lack of a formal contract at the outset and the lack of itemized billing during the project. Craftsmen provided only a written proposal, which is not sufficient for a project of this magnitude. When hiring a contractor, be sure to protect yourself by having a qualified attorney review all documents, proposals, and contracts before you sign. All contracts should include a clear payment schedule in which the final payment is typically 25% of the entire fee, provided only upon completion of the project and a satisfactory final walk-through with the contractor. Once hired, all communication should be in writing, and you should request regular written updates from the contractor, so there is a clear understanding of the status of work completed and work to be done.

• Document the process. As the saying goes, a picture is worth a thousand words, and that is certainly true where renovation projects are concerned. Be certain to take many photos of your project, including shots of the site before, during, and after the renovation is complete.

My friend and his family were ultimately able to pivot their renovation to another contractor, who repaired Craftsmen’s mistakes and finished the project. The family is now happily enjoying their beautiful, freshly remodeled home.

If my friends had only done more diligent research and consulted with an attorney before working with Craftsmen, they could have potentially avoided the entire awful experience. Instead, they had to live through an enormous amount of stress, the upheaval of an unfinished living space, hideously long delays, and considerable additional expenses. You can learn from their mishaps and use the steps above as important preventive measures. They may be your — and your house’s — saving grace. v

 

Attorney Joshua L. Woods is an associate with Bacon Wilson, P.C. and a member of the firm’s business, corporate, and commercial law team. He has extensive experience in matters of business law, including all aspects of corporate formation, franchising, joint ventures, leasing, and business and commercial litigation. He is licensed to practice in both Massachusetts and Connecticut; 413-781-0560; [email protected]

Health Care

Danger Zone

By Mark Morris

MHA’s Alane Burgess (left) and Kristy Navarro

MHA’s Alane Burgess (left) and Kristy Navarro say social isolation during the pandemic has been problematic for young people.

 

According to the Centers for Disease Control and Prevention, the national suicide rate declined slightly in 2019, the last year for which full statistics are available.

Unfortunately, the latest government data does not take into account the arrival of COVID-19 early in 2020. But area mental-health professionals know what they’re seeing and hearing almost 20 months into the pandemic.

Amanda Hichborn, director of Outpatient Clinical Services for River Valley Counseling Center’s Westfield office, said the impact of COVID has in some ways been a double-edged sword when it comes to suicide risk.

“The risk factors for suicide have definitely increased,” she said. “At the same time, we’ve also seen protective factors that have come into play.”

On top of fears about our health, Hichborn explained, the pandemic also affected basic needs such as food — as evidenced by shortages in grocery stores — as well as the ability to sleep well, employment security, and freedom to move around wherever and whenever we want.

At the same time, she has seen people spend more time with their family, increase their fitness by taking walks to get outside, and improve their diets by eating more at home.

“Vulnerable groups like disenfranchised people were already struggling with basic needs. Throw the pandemic on top of it, and their needs are impacted tenfold.”

“These protective factors work to actually decrease the risk of suicide,” Hichborn said. “When we go through something as a community, we feel a kind of connectedness, which also helps decrease suicide risk.”

However, she was quick to point out that, while we may all be in this together, we’re not all in the same boat.

“Vulnerable groups like disenfranchised people were already struggling with basic needs,” she said. “Throw the pandemic on top of it, and their needs are impacted tenfold.”

Young people in particular have had a tough time with the pandemic. Alane Burgess, clinic director of the BestLife Emotional Health & Wellness Center at the Mental Health Assoc. (MHA), noted that, while depression and anxiety have increased for all ages, it’s been particularly tough for adolescents, and suicidal thoughts and attempts are on the rise.

“With adolescence, there is a sense of permanency that things won’t change,” Burgess said. “When they experience social isolation, it feels like forever to them.”

Kristy Navarro, a clinical supervisor at MHA, said keeping young people safe in a pandemic can run counter to how parents raise their kids.

“Normally we want our kids to share, but now we’re saying, ‘don’t share, and don’t touch anything,’” she said. “When we discourage sharing things with friends, it can be a hindrance to the growth and development of young children and adolescents.”

 

Managing the Stress

Dan Millman agrees that the pandemic has affected young people in unique ways.

“It can be hard for young people who miss rites of passage like graduations and other celebrations and rituals,” he said. “Another part is the social stuff like having fun with friends and being independent. All of that has been much harder to do with the pandemic.”

Millman is the director of ServiceNet’s DBT program, or dialectical behavior therapy, an evidence-based approach to psychotherapy that can be effective with people who are exhibiting self-destructive behaviors.

Amanda Hichborn says staying home more has benefited people’s health

Amanda Hichborn says staying home more has benefited people’s health in some ways, but the pandemic has had plenty of negative effects, too.

DBT differs from conventional therapy in that it follows a more structured protocol. The six-month program is designed to give clients the skills to manage the urges to engage in self-harming behaviors. Millman described four main techniques of DBT:

• Mindfulness, a skill that helps the client focus on healthy coping skills to prevent negative thought patterns and impulsive behavior, and which is integrated throughout DBT techniques;

• Distress tolerance, which is most effective in improving a moment with soothing or distraction skills. “The point of this skill is to help survive the crisis without making things worse,” Millman said;

• Emotion regulation, a technique that allows clients to strengthen their emotional resiliency to more effectively navigate powerful feelings; and

• Interpersonal effectiveness, which Millman described as developing assertiveness skills so clients can ask for what they want, better address their needs, and set limits when necessary.

“The point of DBT is to help people feel like their life is worth living and has improved,” he explained. “It’s not a good outcome to have someone stay alive while still suffering the torment they have been feeling.”

Relieving the torment starts with allowing the client to accept they have suicidal thoughts. In this context, acceptance means acknowledgement, not approval.

“When someone has suicidal thoughts, it’s a sign to them that something is wrong in their lives that needs to change,” he said. “Acknowledging those thoughts can actually be protective for the person.”

Another area of DBT involves stepping into painful emotions. Millman explained how human instincts try to protect us and avoid things that make us feel anxious, so we tend to put them off. Avoiding a difficult conversation is a good example of something that needs to be done, but creates anxiety before we do it.

“I talk with people about what they can and cannot control. Though we can’t control events outside, we can control ourselves and our responses to those events.”

One way clients deal with emotional pain is to engage in self-harming behaviors such as cutting themselves.

“We ask the client to just sit with the urge to cut themselves without acting on it,” he said. “In that way, we are asking them to step into the pain. It’s easier said than done, and it’s really challenging.”

The point is to show the client they confronted the moment and got through it. A distraction like a funny video or throwing themselves into an activity can also help, he added. “Once they are ready for the next step, they can use some of the other skills to influence the emotions that are underneath the urge and begin to think differently about it.”

 

Support Systems

The pandemic looked like it was going to subside this past spring as warm weather arrived and many people were getting vaccinated, but then the Delta variant reared its head, and vaccine levels plateaued. While that created frustration for everyone, it was particularly hard on people with pre-existing conditions related to anxiety and depression.

Dan Millman runs a program

Dan Millman runs a program that helps people take control of self-destructive tendencies.

Navarro said the confusion of starting to feel safe, and then, suddenly, not so safe, can lead to hopelessness, a huge risk factor in suicidal tendencies. A person who feels hopeless will often make vague statements such as “I can’t do this anymore,” “I don’t want to be here,” and “this is too hard,” she noted.

“I talk with people about what they can and cannot control. Though we can’t control events outside, we can control ourselves and our responses to those events.”

During the pandemic, social media can either help people feel more connected or lead to more hopelessness. Hichborn noted that, while it’s good to see friends and loved ones from across the country, social media also creates misleading impressions. The people smiling in the photo look happy, but they might be feeling lots of stress in their lives.

“The effect of social media is counterintuitive because it makes us feel more connected upfront, but in the long run makes us feel a lot more depressed and isolated,” she said.

Two other groups emotionally affected by the pandemic are very young children and seniors. Hichborn said she sees clients from ages 3 to 77. When a parent with young children dies, it can create a suicide risk.

“The child has a concept of mom or dad dying, and they want to see them again,” Hichborn said. “The child might feel like they have to die in order to see their mom or dad.”

Older people who are at risk of suicide tend to show warning signs such as saying goodbye to people, giving away their prized possessions, and cleaning out their house. When family members see this type of behavior, it’s important to talk with the person.

“If you see any suicidal ideations or any warning signs within a family member, don’t beat around the bush — ask them directly, ‘are you feeling suicidal? Are you having thoughts of harming yourself?’” she said.

If they’re not having those thoughts, Hichborn added, the question will not encourage people to start thinking about it. “It doesn’t work that way.”

In addition to asking direct questions, Burgess suggested active listening and being supportive.

“Sometimes the most important thing to do is listen and acknowledge the person’s experience,” she said. “They don’t need you to fix it, they just want to be heard.”

Hichborn recommends a safety plan displayed on the refrigerator to help a person who might struggle with suicidal thoughts.

“The plan can have support people to call and emergency numbers like the police, suicide hotline, or poison control,” she explained. “Everything is written out in a place that’s easily seen, so when someone isn’t thinking straight and their thoughts are all over the place, they don’t have to think about what to do — it’s right there.”

 

Stay Connected

Though we might feel alone in our thoughts, Burgess encouraged people to reach out to those they are comfortable with to talk about their feelings.

“What’s profound about the pandemic is that it’s a collective experience everyone is going through,” she said — and one that no one should have to confront alone.

Business of Aging Special Coverage

Pivoting … Again

By Mark Morris

David Ianacone says infection-control expertise

David Ianacone says infection-control expertise in the skilled-nursing world predates COVID by far.

Just when it seemed COVID-19 was getting under control, the Delta variant of the virus took hold — and has encouraged many communities in Western Mass. to once again mandate wearing masks indoors.

With the variant showing no signs of slowing, BusinessWest checked in with several companies that serve seniors in the area — through home care, assisted living, and skilled nursing — to ask how they are navigating this stubborn virus that won’t go away.

They all have different stories, but one constant stands out: all of them have kept safety protocols in place that exceed the requirements of state and local mandates.

For David Ianacone, administrator at the Center for Extended Care and Rehabilitation at Amherst, rigid protocols are in place at all times to prevent infection problems.

“In the nursing-home business, we’re experts in infection control,” he said. “Long before the virus, we’ve had protocols in place known as ‘universal precaution.’”

Indeed, everyone who enters the facility must get their temperature taken and fill out a health questionnaire. Masks are required for staff and visitors at all times. Ianacone said 99% of the patients are fully vaccinated, and he estimated that 92% of the staff have received the vaccine.

“We have around 15 unvaccinated staff, most of whom work in the office or dietary area and are not in direct contact with patients,” Ianacone said. “They are tested every day before their shift begins.” If the test comes up positive, they have to leave.

The protocols have certainly been working; since January, when one patient at the center contracted the coronavirus, no staff or patients have tested positive.

This clean bill of health has allowed visitors to once again see their loved ones in person, but Ianacone pointed out there are restrictions based on the visitor’s vaccination status.

“If they are vaccinated and their loved one is also, they can meet with them closely in their room,” he explained. “But if a visitor is not vaccinated, we have a special room where they can visit in private, but they must maintain social distancing.”

Visitors to Cedarbrook Village at Ware have also returned to restricted visits with residents due to the resurgence of the virus.

Before Delta, Executive Director Kelly Russell said, families could visit with loved ones in their apartments and take meals with them. Since the resurgence, only a few guests can meet with the resident in a designated area that is disinfected after each visit.

“We’re actually going above and beyond what the CDC is recommending for our community,” she noted.

Before the Delta variant, the assisted-living facility was starting to return to normal activities like outings and even a trip to MGM Springfield.

“The residents had a great time at the casino, but we had to stop all trips like that because of the variant,” she said. “We also had to cancel the one-year anniversary of our opening that we had planned for September.”

Russell said her focus is now on “out-of-community risks,” meaning staff and residents out in public, residents coming out of acute settings, and visitors. Protocols are in place to mitigate risk in all these areas.

Patricia-Lee Baskin-Scholpp says she requires her home-care staff to be vaccinated to protect senior clients.

Patricia-Lee Baskin-Scholpp says she requires her home-care staff to be vaccinated to protect senior clients.

With vaccination rates among Cedarbrook staff at nearly 80%, the next challenge will be a state mandate that takes effect on Oct. 31 requiring everyone who works with seniors to be vaccinated.

“We have a responsibility to keep the residents in our community safe,” Russell said. “If there are still some people who refuse to get vaccinated, there’s a good chance they will not be able to work here.”

 

Girding for Battle

Patricia-Lee Baskin-Scholpp isn’t waiting for the state to act. The owner of Caring Solutions, a home-care company based in West Springfield, will not hire anyone who is not vaccinated. And, while 98% of her current staff is vaccinated, home care is an industry with lots of turnover.

“It’s already hard to find candidates, and by requiring a vaccination, the pool becomes that much smaller,” Baskin-Scholpp said. “Despite that, I won’t put my seniors at risk.”

A nurse by training, she discussed the reason she is passionate about vaccinations to prevent the spread of the coronavirus. “When you hold someone’s hand who is dying of COVID, it changes something in you.”

Baskin-Scholpp also believes we are in a war against COVID, and that one battle strategy worth embracing is wearing a mask. “I have N95 masks in many colors so our staff can make them part of their wardrobe,” she said. “We have to wear a mask anyway, so let’s own it.”

After several months without them, residents at Cedarbrook are back to wearing masks when they leave their apartments. For most, Russell said, it’s simply retraining.

“We opened at the height of COVID when many of our residents moved in. At that time, they had their masks with them at all times. Now they just need occasional reminders.”

“We opened at the height of COVID when many of our residents moved in,” she recalled. “At that time, they had their masks with them at all times. Now they just need occasional reminders.”

Because the virus is prone to change, Ianacone said he and his peers at other long-term-care facilities have an open communication stream with the Massachusetts Department of Public Health and the state office of epidemiology. “From time to time, they will recommend new protocols for us to implement to keep everybody safe.”

State health officials had raised concerns when several nursing homes discovered cases of the Delta variant. Ianacone pointed out that the protocols to protect against the Delta variant are the same as protecting against the original coronavirus, so staying consistent in COVID-prevention practices works.

“Because our patients are vulnerable, we always go the extra mile in our safety measures,” he added.

Baskin-Scholpp and her staff of 70 caregivers routinely go the extra mile based on a simple principle.

“If you treat people the way they want to be treated, it works,” she said. “We believe people should be able to stay in their own home and shouldn’t have to pay a fortune to do so.”

She named her company Caring Solutions because she believes every challenge has a solution, even COVID.

“This virus isn’t going anywhere right now, so let’s do everything we can to keep everybody safe,” she told BusinessWest. “It’s really less about individual rights and more about protecting each other.”

As a new facility, Cedarbrook still has apartments available for new residents. When the pandemic first hit, many seniors and their families were fearful of moving into a senior community.

Since that time, as everyone gains more knowledge about the virus, Russell and her staff have continued their diligence with cleaning and safety protocols, which have helped many of those fears to subside.

“People are still able to take tours, and we simply follow a cleaning schedule after the visit,” she said. “As a result, we’re seeing four to six move-ins a month, which is great.”

 

Life on the Front Line

Reflecting on the past 18 months, Ianacone said he appreciates how grateful the families of his patients have been during a time of constant adjustment.

“Hearing from the families is very warming to us staff members because they feel we are doing a good job taking care of their loved ones and keeping them safe.”

While these senior service professionals wage their fight against a stubborn virus, they continue to succeed in keeping seniors in our community safe. Baskin-Scholpp may have summed up the reason for everyone’s dedication.

Simply put, she said, “I am very passionate about our seniors.”

Community Spotlight

Community Spotlight

By Mark Morris

Amy Cahillane says the city is in a better place

Amy Cahillane says the city is in a better place than it was a year ago, but staffing remains a problem for businesses.

As Northampton works through the various stages of the pandemic, one term best describes any discussion about looking ahead.

“I’ve used the phrase ‘cautiously optimistic’ hundreds of times in the last several weeks, never mind the last year and a half,” said Amy Cahillane, executive director of Downtown Northampton Assoc. (DNA) — cautious because the city reimposed mask mandates before many other communities did, and optimistic because, despite all the challenges, Northampton can point to many successes.

Janet Egelston, owner of Northampton Brewery, said the last 18 months have been an ongoing process of pivoting, adapting, and learning, adding that “we call what we’re going through ‘pandemic university.’”

Northampton enjoys a long tradition as a dining destination. With more than 100 places to eat in the city, restaurants are a key sector to Northampton’s economy. Vince Jackson, executive director of the Northampton Chamber of Commerce, said economic studies have shown that, when restaurants are thriving, other business sectors do, too.

“Every job a restaurant creates results in another job in the community,” he explained. “Think about a typical date night — go out for dinner, go see a show, and then maybe a drink at the end of the evening.”

That’s why the pandemic, and the business restrictions that have accompanied it, have been so disruptive to the city’s economy. And the disruptions have come in waves; earlier this spring, when vaccines became widely available and COVID-19 infection numbers began to decrease, Northampton, like many communities, was able to relax masking requirements. Once vaccination levels began to plateau and the Delta variant of the virus kicked in, infections began to trend back up.

And when the city’s Health Department found several breakthrough cases that forced a couple restaurants to close for testing and quarantine, Mayor David Narkewicz made the decision to bring back indoor mask mandates.

“We are very fortunate to have this outdoor space, but it wasn’t as simple as opening the doors.”

“It’s never easy to be out front and be the first, but since we brought back masking, the communities around us have followed suit,” he said, adding that the city’s priority is keeping everyone safe and healthy. “We need businesses open for customers. Otherwise, the engine that drives Northampton isn’t going to run.”

The return to wearing masks was an easy change for Egelston’s staff at Northampton Brewery.

“In the restaurant business, we often make quick adjustments,” she said. “We also have a box of masks at our entrance for customers who arrive without one.”

In 2020, when the first wave of the pandemic closed all kinds of businesses for several months, Egelston delayed her reopening until Aug. 10, the 33rd anniversary of the brewery. Even though outdoor dining has always been a part of the restaurant, with two levels of rooftop decks, she still had to retrofit the space for the times.

“We installed plexiglass barriers and socially distanced our tables outside as if we were inside. We are very fortunate to have this outdoor space, but it wasn’t as simple as opening the doors,” she said, adding that all employees are vaccinated. “It’s our policy.”

Janet Egelston says she is “eternally optimistic”

Janet Egelston says she is “eternally optimistic” despite 18 months of pivoting and persistent staffing challenges.

Since reopening last August, the brewery has operated at a lower capacity, not due to mandates, but because of trouble finding enough staff.

“The core staff who work here are great,” Egelston said, adding that, while there is always some amount of turnover, she hasn’t received many applications in the last several months. “That’s starting to improve, but we’re not yet ready to go to full capacity.”

 

Workforce Crunch

While the city is in a better place than it was a year ago, Cahillane said, staffing remains a challenge for most businesses.

“When everyone is hiring, it perpetuates the issue further because employers are all looking for the same people,” she noted. “They are also filling positions at every conceivable level, from dishwasher to front of house to store manager.”

Despite the staffing challenges, Jackson said most businesses in Northampton had a great summer. In talking with business owners in the restaurant, retail, and construction sectors, he said many reported success at pre-pandemic levels.

“A caterer I spoke with has 200 events booked through the end of the year,” he said. “One restaurant owner said her numbers are better than they’ve been in a long time.”

Northampton at a glance

Year Incorporated: 1883
Population: 28,483
Area: 35.8 square miles
County: Hampshire
Residential tax rate: $17.37
Commercial tax rate: $17.37
Median Household Income: $56,999
Median Family Income: $80,179
Type of government: Mayor, City Council
Largest Employers: Cooley Dickinson Hospital; ServiceNet Inc.; Smith College; L-3 KEO
* Latest information available

‘Summer on Strong’ was a successful effort to close an entire section of Strong Avenue to traffic and turn it into an outdoor dining pavilion shared by a few different eateries. Narkewicz credited local restaurants for suggesting and leading the effort. When ideas like this were proposed, the mayor said the city would “move mountains” to streamline the permitting process to make them happen.

“Northampton is a regional magnet for people who want to come here for entertainment, arts, dining, and the vibe of a walkable city where people like to hang out,” he noted.

The city lost businesses during the pandemic, including Silverscape Designs, which closed at the end of 2020. Despite the optics of that vacancy in the middle of downtown, Cahillane said a mix of new businesses have been opening at an encouraging pace.

“Between Northampton and Florence, we had roughly 18 businesses that left,” she noted. “And nearly 17 new places opened.”

The return of students to Smith College and campuses in the surrounding towns marked a sign of life before the pandemic. Cahillane said the students brought a needed emotional lift. “There has been a noticeable lightening and brightening downtown since the students have come back. Their return is what Northampton usually feels like in the fall.”

The return of events this summer has also provided a boost to Northampton. Cahillane said it’s satisfying to look at a calendar and see events scheduled once again. “The Arts Council held several concerts this summer, we recently started Arts Night Out, and the Jazz Festival is coming back the first weekend in October.”

Jackson is “cautiously optimistic” that momentum from the summer will continue into fall leaf-peeping season. In this area, Indigenous Peoples Weekend marks prime time for leaf peepers.

“One hotelier told me if you don’t book early for that weekend, you won’t find a place to stay,” he said, adding that he’s hopeful activities in November and December will also bring people to the city and surrounding towns.

This fall will be different for Narkewicz, as he will not seek re-election as Northampton’s mayor. Looking back on his 10 years in office, he discussed several areas in which he’s proud of his administration’s achievements, such as improving the fiscal health of the city and being one of the first communities to stand up for the important role immigration plays in the U.S.

“We stand up for equality for all our residents,” he said. “We’ve received high marks for our commitment to LGBTQ folks and have been doing more work around racial equality.”

For the next few months, he hopes to develop a blueprint for the next mayor. “My goal is to provide a map of the immediate needs and available resources, so the next administration can work with stakeholders in the community to make sure we see a strong, equitable recovery to COVID.”

 

Keep Moving Forward

Among many in Northampton, the consensus is to keep moving forward, but also stay safe.

“I don’t know what’s going to happen, but I am eternally optimistic,” Egelston said. “It’s the only way I’ve been able to be in the restaurant business for so many years.”

Jackson said having events return to the city, sometimes in different forms, went a long way to giving people reasons to come to Northampton. “I won’t say this is a new normal, but it feels right for this moment.”

Education

Dollars and Sense

By Mark Morris

From left: Square One’s Dawn DiStefano, Melissa Blissett, and Kristine Allard; and FP Investment Group’s Flavia McCaughey, Flavia Cote, and Peter Cote.

Given the scope of Square One’s work for children and families, it’s not unusual for the organization to receive contributions to support its efforts.

But recently, FR Investment Group offered a donation that goes far beyond writing a check.

“Instead of making a monetary donation, we’ve chosen to do something harder,” said Peter Cote, president of FP Investment Group. “We’re giving our time and services to help Square One clients and staff improve their financial literacy.”

Dawn DiStefano, Square One’s executive director, had seen similar attempts at financial education fizzle out, despite good intentions. This latest proposal was different.

“The FR group wanted to understand who we are and what we want for our clients and staff,” she said. “They were curious, inquisitive, and showed us they valued our expertise as well.”

The Empower Financial Literacy program is now a monthly offering at Square One. Flavia Cote, executive vice president of FR Investment and Peter’s wife, runs the session each month with FR staff, including her daughter, Flavia McCaughey, a vice president with FR.

McCaughey presented the idea to her parents that working with families at the lowest income levels to help them understand the basics of finance could have a huge impact on those families — and also on the community at large. The Cotes supported the idea but also offered some sage advice.

“My parents told me to be prepared that maybe only one person would show up to the meeting,” McCaughey said. “I discussed that possibility with the team, and we decided if the program makes a difference in even one person’s life, it’s worth it.”

Instead, 14 people have signed up for the program, with eight or nine regularly attending the monthly sessions.

“Given that we’re still dealing with COVID and that everyone has busy lives, I’m excited about 14 sign-ups,” DiStefano said. “The program will be here when they’re ready. It’s not a one-and-done.”

“Instead of making a monetary donation, we’ve chosen to do something harder.”

Far from it. Peter has committed his firm to running the financial-literacy program for the next 30 to 50 years.

“That’s how long it’s going to take to make real change in the financial well-being of our community,” he said. “You have to be on the ground and commit to the long term.”

 

Changing the Narrative

This kind of commitment is necessary to break what DiStefano called a self-fulfilling prophecy of bad outcomes.

“Those who grew up in a family where they worried about how they were going to eat and get to school often end up creating that same unstable environment for themselves when they are adults,” she said. “They’re not surprised when they lose an apartment or don’t care about their credit score because they feel they couldn’t buy a car anyway.”

Just like savings, tough situations also have a way of compounding and growing. DiStefano gave an example of someone who lost a job, and in order to receive housing assistance, they had to be in arrears on their rent, which would then negatively affect their credit score. “This is what people are dealing with,” she said.

Melissa Blissett, vice president of Family Support Services at Square One, asks people what’s going on that prohibits them from living a better life and uses a tool called the family-goal plan to help them.

Flavia McCaughey leads a financial-literacy session at Square One.

Flavia McCaughey leads a financial-literacy session at Square One.

“The FR folks speak the same language we use with our families, and we both use the SMART goal approach,” Blissett said. SMART, a popular goal-setting technique, is an acronym for specific, measurable, achievable, relevant, and timely.

Flavia Cote said her team encourages people to set a goal such as buying a reliable car, and the FR staff breaks it down to the actions needed to eventually reach the goal.

“We encourage people to try to save at least $10 a month,” she said. “Even if they can’t save $10 next month, they have started to think about saving.”

To prevent being overwhelmed by a large goal, Peter suggests taking it one step at a time. “I don’t want people to think about years from now — just think about the next 24 hours. When you bring it down to 24 hours, you help people see an attainable goal.”

In their monthly sessions, the FR staff help people with figuring the numbers and, more importantly, understanding the emotions that come with handling finances.

“If someone can’t save for one month, we encourage them to set the goal for next month,” Flavia said. “We want to bring hope and make finance simple enough for people to achieve some sort of financial independence.”

Like dedicated saving, positive actions can also have a compounding effect. Recently, a class-action case involving overdraft fees at a regional bank reached a settlement for several million dollars. Once all the claimants received their share, $23,000 remained. This final amount is usually provided to a nonprofit program in alignment with the core theme of the case and is known as a ‘cy pres,’ from a French phrase meaning ‘as near as possible.’

The plaintiff’s counsel, Angela Edwards, learned about the Square One program from Flavia Cote and thought it sounded perfect. “I recommended the cy pres for Square One, the defense counsel agreed, and the judge approved it.”

 

Making Progress

Peter Cote sees his main job not as a financial person, but as a champion for others. “We’re dealing with people who have a variety of financial challenges, and we are their champions to let them know it will be OK.”

When people attend the sessions at Square One, Flavia said, they show they are ready to make progress with their lives. “We try to help people understand their situation is not permanent and there is a way to change it.”

While a term like financial literacy might sound academic, Peter offered a few different terms that might better describe the course.

“You could call it financial well-being, or Life 101,” he said. “Maybe Figuring It Out 101.”

Business of Aging

Regaining Control

By Kimberley Lee

 

In addition to community-based programming, Nigel Cooper serves as program coordinator for one of nine residences MHA operates as part of its New Way division in the Greater Springfield area for individuals with acquired brain injury.

The division, which also includes a day component, serves those whose brain injury is severe and acquired after birth as the result of a trauma or medical condition. Impairments can range from the physical to the cognitive to the behavioral.

“Our residents were not born with their disabilities,” Cooper said. “Some are college graduates, some have had jobs, some have wives, husbands, children. Something happened in their lives, could be an accident, they could have had a stroke, something that causes the brain not to function as well as it did.”

The specialized care an acquired brain injury patient might need often results in a nursing-home placement, something Cooper calls “unfortunate,” as “some are 30 years old, 50 years old, and find themselves living their life out there. A week or month or days before, they were going through their everyday life in their community.”

This is when New Way, under division Vice President Sara Kyser, can help those referred by the state, after assessment by a skilled-nursing facility, transition from that facility into one of its neighborhood residences.

“Basically, we are transitioning them back to life. They may not have the same life as they had before, but we try to make it as close to that as possible.”

“We interview the individuals and find a good fit for them in one of our homes,” Cooper said. “Basically, we are transitioning them back to life. They may not have the same life as they had before, but we try to make it as close to that as possible.”

His determination and respect for New Way residents mirror how staff engage with them and the programming that includes both rehabilitation and outreach. Services are aimed at helping residents integrate back into their community life, be it through work, volunteer opportunities, or participation in the Resource Center, a New Way program that is also open to those with a disabling medical condition.

“Yes, we provide care, but what I like to say is that we provide support — the difference being that, whatever our residents can do, we approach them to keep on doing that,” he explained. “That is where we meet them; that is where we start our work with them.

“We don’t want people to get discouraged because they need support,” he went on. “There can be depression and a lot of anxiety. So, if someone can cook, we encourage that. If someone can wash their clothes, we encourage that. If someone can bathe themselves, we encourage that.”

The goal, he said, is “to build an independent life for them as far as we can with their injuries.” In the case of one resident in his 30s whose memory was greatly impacted by a drug overdose, this meant getting the support need to be matched with a job, finding his own way over time to and from certain destinations, and eventually moving from a four-bed New Way residence into a less supervised two-bed home.

“We helped move him out of a nursing home and recreated a life that would work for him and his injury,” Cooper said.

For another resident, it has meant regaining the ability to eat without assistance and working toward being able to stand and walk again with less help. “We push 150% to get the residents in all our homes into the communities they live in — reuniting them with family members, keeping them involved in activities outside the residences.

“We are not into just housing people,” he added. “We want to get people out and into society to do whatever they want to do. We are not just ‘housers’ of our residents.”

One key to success, he said, is the trust that develops between staff and residents.

“The job is about making relationships and being motivators, getting people to invest back in themselves — helping them to understand their situation happened, but it is not the end of the world. There is life, there are resources, there is a way you will now live that is different from before, but you will eventually get to a point where you can enjoy your life.”

He added, “I tell staff all the time that the house will get clean, the floors will get swept.”

Cooper noted that “what we need to build is relationships through consistency and being there. We are the people the residents see every day and depend on and trust for support. Once a relationship is built, residents will go to appointments with you, allow you to do personal care and take suggestions. They understand you are in this with them.”

Richard Johnson, who works under Cooper as a site manager, echoed his comments.

“We are all about making the residents feel comfortable,” said Johnson, whose job includes coordinating volunteer opportunities for residents such as cooking and serving meals for the homeless or preparing and distributing COVID hygiene packages for seniors.

He also arranges for residents to attend events like Springfield College’s recent “Be the Change” presentation that was held to promote community service. Staff and residents attend events together but without any indication of their association.

Johnson said such outreach is about the residents continuing to “build relationships” on their own terms and improving their integration skills.

“One of the residents who attended the Springfield College event told me that it was the most comfortable he has felt in years in terms of being out in the community and talking to people,” he noted. “Everything was free, and he just liked being able to go up to a vendor, get nachos and a drink. That engagement on his own was important to him in building a sense of normal for himself.”

Johnson said he builds relationships with the residents through “really hard, honest conversations through which I learn how to navigate and pick up on what they like and what they want to do.”

He noted that transitioning into more active community engagement is not always easy for residents with their disabilities, but he enjoys helping them make that transition and working with Cooper to find related opportunities.

Cooper added that it is this “giving someone a chance to have possibilities and control in their life again” that gives him job satisfaction.

“A lot has been taken away from our residents,” he went on. “The life they were used to living is no longer. They are not living with their families. They can’t just go out to the store or into the kitchen to make what they want to eat or jump on an airplane and travel. What makes me feel good is to see some sort of normalcy return to their lives and for them to get to a certain level where they have control.”

 

Kimberley Lee is vice president of Resource Development & Branding at MHA.

Opinion

Opinion

By Eduardo Crespo

 

President George H.W. Bush proclaimed the first Hispanic Heritage Month on Sept. 14, 1989 to honor the achievements of Hispanic-Americans.

Sept. 15 was chosen as the date of commemoration because it is the anniversary of the independence of five Hispanic countries: Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua, all of which declared independence in 1821. In addition, Mexico, Chile, and Belize celebrate their independence days on Sept. 16, 18, and 21, respectively.

Hispanic Heritage Month celebrates the accomplishments of Hispanic-Americans, who have enriched our culture and society and helped make America into the incredible country it is today. Hispanic-American men and women embody the American values of devotion to faith and family, hard work, and patriotism through their countless contributions as leaders, innovators, entrepreneurs, and members of our Armed Forces.

They have in the process helped to build a better future for all Americans.

Hispanic-Americans also continue to support our economy and society as business owners, professionals, teachers, and public servants. We should recognize their achievements and contributions to our national story.

The Hispanic market has shown unprecedented income growth in the U.S. even as Hispanic-Americans have become an important sector of the workforce. It’s what I call ‘the Hispanic Opportunity,’ a unique phenomenon in U.S. history in which Hispanic demographic growth is ascending rapidly while the white population is declining.

These developments have together created immense opportunities in the marketplace.

Indeed, progressive, market-driven brands and employers are creating new paradigms incorporating Hispanics as part of their core business strategies and corporate culture. Marketing campaigns today must be culturally relevant and linguistically appropriate, not merely translations of content developed for other audiences.

Only consumer brands that cater to Hispanics will achieve meaningful success.

Also, one out of four residents under the age of 18 is Hispanic, meaning the future of America depends on how well they do in terms of education, work, and achieving the American dream.

 

Eduardo Crespo, an immigrant from Ecuador, is a bilingual/bicultural professional and founder and CEO of Hispanic Market Solution in Lawrence. This article first appeared on the Associated Industries of Massachusetts blog.

Construction

Greener Days

MassDevelopment announced that Abercrombie Greenfield, LLC will receive $450,000 in financing for energy improvements to its office building at 56 Bank Row in Greenfield, the first project financed under the agency’s new Property Assessed Clean Energy (PACE) Massachusetts program.

Through PACE Massachusetts, capital provider Greenworks Lending from Nuveen will provide financing for a range of energy upgrades that were installed to the building, including  efficient electrification of space heating, energy-recovery ventilation, LED lighting and controls, improvements to windows and insulation, and a solar photovoltaic system on the roof. This financing will be repaid via a betterment assessment on the property.

“PACE Massachusetts stands to be a key financing tool for making commercial properties more energy-efficient,” said Housing and Economic Development Secretary Mike Kennealy, who serves as chair of MassDevelopment’s board of directors. “These efforts will benefit the Commonwealth and its communities by creating jobs, reducing energy consumption, and making progress towards Massachusetts’ clean-energy goals.”

MassDevelopment President and CEO Dan Rivera noted that energy upgrades at 56 Bank Row are the first to be financed under PACE Massachusetts. “We encourage property owners throughout the Commonwealth to consider how this flexible, long-term financing tool can help them tackle an energy-improvement project.”

Launched in July 2020, PACE Massachusetts is a new long-term option for financing energy improvements to commercial and industrial buildings, multi-family properties with five or more units, and buildings owned by nonprofits. The program enables commercial property owners to fund energy-efficiency and renewable-energy projects by agreeing to a betterment assessment on their property, which repays the financing.

“The renovation of the Abercrombie Building rescued a blighted historic property that was structurally failing.”

Offering more flexibility than a direct loan, PACE Massachusetts allows property owners to undertake comprehensive energy upgrades without adding new debt to their balance sheet and through longer financing terms of up to 20 years. MassDevelopment administers PACE Massachusetts in consultation with the Massachusetts Department of Energy Resources (DOER).

“DOER commends PACE’s first approved project for its commitment to comprehensive energy improvements and building electrification using heat pumps,” Department of Energy Resources Commissioner Patrick Woodcock said. “As the number of municipalities opting into PACE grows, we look forward to having more commercial properties take advantage of this program to finance renovations and retrofits to help meet the Commonwealth’s ambitious greenhouse-gas emission-reduction goals.”

Massachusetts cities and towns are required to opt into PACE Massachusetts by a majority vote of the city or town council or the board of selectmen, as appropriate, in order for a property within that municipality to be eligible for the program. Forty-seven cities and towns have opted in; the city of Greenfield was one of the earliest to do so in April 2018.

“This historic PACE financing for the complete energy-efficiency renovation of an underutilized building on Bank Row joins many energy-efficiency ‘first’ accomplishments in our city since we became the first green community in Massachusetts in 2010,” Greenfield Mayor Roxann Wedegartner said. “It’s a legacy we should all take pride in and continue to support.”

Built in 1896, 56 Bank Row is a 12,696-square-foot office building. The energy improvements are projected to save 189,000 kilowatt hours from the grid annually compared to a building built to current Massachusetts energy-efficiency code, which equates to a 28% overall reduction.

“Greenworks Lending from Nuveen is very proud to have worked with MassDevelopment to bring financing for Massachusetts’s first C-PACE project at 56 Bank Row,” said Greenworks Lending from Nuveen CEO and President Jessica Bailey. “We hope that this is the first of many C-PACE projects to come with MassDevelopment as we work together to bring financial and environmental benefits to local businesses and communities in Massachusetts.”

Bradley McCallum, owner of 56 Bank Row, added that “the renovation of the Abercrombie Building rescued a blighted historic property that was structurally failing. The project combines factors including a long-term lease with the Northwestern District Attorney’s Office, state and federal historic tax credits, an innovative design by Tom Douglas Architects, and a committed contractor, Mowery & Schmidt, and their team of subcontractors. Thanks to this team, we were able to transform the bones of this historic structure into a vibrant resource for the city of Greenfield.

“As with projects of this ambition and scale,” he went on, “we faced cost overruns, and one of the positive contributions that PACE Massachusetts provides Abercrombie Greenfield is the ability to retroactively refinance key energy-efficiency investments that we made and consolidate the outstanding bridge financing and private loans into a fixed 20-year repayment structure, providing credit beyond the 80% LTV, which our primary mortgage with Berkshire Bank is capped at. Berkshire Bank, which is our tax-credit investor and lender, has worked in partnership with Abercrombie Greenfield to secure our PACE Massachusetts financing.”

Construction

From Parking Lot to Plaza

MassDevelopment has awarded a $10,000 grant to the North Adams Chamber of Commerce to transform the Center Street parking lot at 55 Veterans Memorial Dr. in North Adams into a seasonal public dining corridor dubbed Mohawk Plaza.

The organization will use funds to add outdoor seating, a sidewalk surface mural, wayfinding signage, ambience lighting, and landscape work. The chamber will also crowdfund this summer and fall; if the organization reaches its $7,850 goal, it will receive an additional $7,850 matching grant from MassDevelopment.

The funds are awarded through MassDevelopment’s special Commonwealth Places COVID-19 Response Round: Resurgent Places, which was made available specifically to assist local economic-recovery efforts as community partners prepare public spaces and commercial districts to serve residents and visitors.

“Before this pandemic, the vibrant centers of our cities and towns were not only a driving force behind the strength of local economies, they were the places where we gathered to dine, to shop, and to be entertained, and the Commonwealth Places program is one way that we can help these areas bounce back stronger than ever,” said Housing and Economic Development Secretary Mike Kennealy, who serves as chair of MassDevelopment’s board of directors.

“The Baker-Polito administration continues to support downtowns and town centers through various economic-recovery programs,” he added, “and these Resurgent Places grants are providing nonprofit community organizations with the resources to activate public spaces, boost economic activity, and support an equitable recovery.”

Created in 2016, Commonwealth Places aims to engage and mobilize community members to make individual contributions to placemaking projects, with the incentive of a funding match from MassDevelopment if the crowdfunding goal is reached. In response to the pandemic, MassDevelopment announced the opening of the first Commonwealth Places COVID-19 Response Round: Resurgent Places in June 2020, and from August through October 2020, $224,965 in funding was awarded for 21 placemaking projects across Massachusetts.

In December 2020, MassDevelopment announced the availability of $390,000 in funding for a second Commonwealth Places COVID-19 Response Round: Resurgent Places. Nonprofits and other community groups can apply to MassDevelopment for seed grants of between $250 to $7,500 to fund inclusive community engagement, visioning, and local capacity building that will support future placemaking efforts, or implementation grants of up to $50,000 to execute a placemaking project. For implementation grants, up to $10,000 per project may be awarded as an unmatched grant; awards greater than $10,000 must be matched with crowdfunding donations.

“Amazing things can happen when communities reimagine underutilized public spaces, such as North Adams Chamber of Commerce’s vision for a parking lot steps away from the city’s Main Street,” MassDevelopment President and CEO Dan Rivera said. “MassDevelopment is pleased to help the organization create Mohawk Plaza, a space that will increase foot traffic downtown, provide additional outdoor dining, and reinvigorate a prime public way.”

Healthcare Heroes

Innovation In Health/Wellness

Director of LGBTQ Services, Cooley Dickinson Hospital

J. Aleah Nesteby

J. Aleah Nesteby

She Pioneered Appropriate Care for a Population That Sometimes Lacks It

By Mark Morris

Healthcare was Aleah Nesteby’s second career goal.

“My first career goal was to be a standup comic, but I eventually realized I didn’t have the stomach for all the rejection that involved,” she said.

As it turned out, comedy’s loss was healthcare’s gain. For the past several years, she has been a family nurse practitioner and director of LGBTQ Health Services at Cooley Dickinson Health Care — and is now beginning a new career at Transhealth Northampton.

In doing so, she will continue her pioneering work providing culturally sensitive healthcare for often-marginalized populations — work that many health organizations have since adopted, long after Nesteby became an early pioneer in this region — and a true Healthcare Hero.

“I thought, if my friends can’t access good care in San Francisco, is there anywhere they can? I also thought, well, I could do that.”

According to the Centers for Disease Control and Prevention, members of the LGBTQ community face an increased risk of health threats due to discrimination and stigma. In her role with Cooley Dickinson, Nesteby has worked to bring more equity and compassion to healthcare for the LGBTQ community. As a practitioner, she has maintained a patient panel of about 500 people, many of whom are transgender.

It’s a passion that predates her medical career, to be sure. Since college, Nesteby has had an interest in healthcare among marginalized populations, but at the time, care focused specifically on LGBTQ people didn’t exist. In the early 2000s, while in San Francisco, she learned that some of her LGBTQ friends were not able to access healthcare.

“I thought, if my friends can’t access good care in San Francisco, is there anywhere they can?” she said. “I also thought, well, I could do that.”

So she did. And for her years of cutting-edge advocacy for this broad and sometimes misunderstood population, Nesteby certainly merits recognition in the category of Innovation in Healthcare.

 

Training Ground

In addition to treating patients, Nesteby’s responsibilities include training providers and staff on how to make medical facilities more welcoming and inclusive.

Much of the training I would call LGBTQ 101,” she said. “It’s a discussion on how to treat people respectfully and how to engage them in language they would like you to use.”

After years of pioneering work at Cooley Dickinson, Aleah Nesteby is taking her passion and talents to Transhealth Northampton.

After years of pioneering work at Cooley Dickinson, Aleah Nesteby is taking her passion and talents to Transhealth Northampton.

One common question — she’s heard it countless times — challenges why LGBTQ patients should be treated differently than anyone else. She explains that everyone has unconscious biases that play into their decisions about treatment for people.

“I try to help providers understand that, even though they think they are treating everyone the same, some of what they are saying isn’t being received by the patient in the way it might have been intended.”

For instance, microaggressions are a common issue — those backhanded compliments and minor comments that might not be insults, per se, but add up in a negative way to the person who hears them. A gay or lesbian person might be told, “I couldn’t tell whether you were gay or straight,” and a transgender person might be asked what their old name was.

“It’s these low-level, unpleasant interactions that many medical folks aren’t even aware they are doing,” Nesteby said, emphasizing that training should include all employees in the medical setting, not just direct care providers. For example, a visitor to the doctor’s office typically first speaks with someone on the front desk, then a medical assistant or nurse, and, finally, with the physician or nurse practitioner.

“Even when all the providers are trained and great to be around, if the staff aren’t trained, it can still be a negative experience for some,” she explained.

Nesteby also helps providers with more detailed training that addresses health issues specific to the LGBTQ community, such as hormone therapy for transgender adults and working with transgender children.

“I’ve also trained doctors on PrEP, a pre-exposure prophylaxis for HIV,” she said. “It’s a medication people can take before being exposed to HIV to help prevent transmission.”

In some ways, Nesteby has always been an LGBTQ trainer. She was studying to be a nurse practitioner back when the transgender health movement — commonly called trans health — was just beginning. Because it wasn’t included in the curriculum, she invited a lecturer to speak to her class about trans health.

“In the beginning, there were lots of things to learn and new ground to break,” she recalled.

Nesteby is now in demand as a speaker at conferences around the country, though her appearances during the pandemic have been virtual. She also participates in TransLine, an internet-based consultation service. “People can e-mail their questions about trans health to volunteers like me, and we answer them as they come in.”

As she became established and word got out that her practice included trans health, patients would travel from hundreds of miles away just to be seen by Nesteby. However, “as trans health has become a more accessible field and more providers have become comfortable with it, there’s less need for people to travel long distances.”

 

Continuing the Conversation

Reflecting on her work with Cooley Dickinson gives Nesteby a great deal of satisfaction. From training medical staff to policies to make the hospital more inclusive, she appreciates all the progress that’s been made so far.

“While there is still work to be done, there has been a cultural shift in Massachusetts on how we view our LGBTQ patients,” she noted.

Jeff Harness, director of Community Health and Government Relations for Cooley Dickinson, called Nesteby’s work critically important to the LGBTQ community.

“It is rare to find a primary-care provider who understands the unique health and social needs of LGBTQ patients,” Harness said. “It’s exceedingly rare to fine one who is so skilled, passionate, and caring.”

This month, Nesteby is leaving Cooley Dickinson to join Transhealth Northampton, a clinic that provides primary care for children and adults. Her role will be similar to her current one in providing primary care and hormone management for her patients. In her new position, she will continue to educate clinicians and will also focus on educating the general public about working with the LGBTQ community.

“I’m an advocate of asking people how they want to be addressed and what pronouns they use,” she said. adding that people often get nervous they might offend if they ask, but the conversation has to start somewhere. “If you are respectful and polite, people will usually respond in kind. They only get upset when someone is rude or asking for information that is gratuitous or not needed.”

In general, Nesteby would like to see a more welcoming and affirming atmosphere in medicine.

“Ideally, I’d like all providers to have some degree of knowledge about how to work with LGBTQ patients because within that there is more opportunity for people to specialize in that care.”

Harness credited Nesteby with making positive changes in the system while always providing excellent care to the person in front of her. “Aleah has improved her patients’ sense of well-being by showing them their medical provider cares about, understands, and welcomes them,” he said.

In her eyes, though, showing compassion is similar some ways to the old adage about a rising tide lifting all boats.

“If we are more open and understanding to folks in one group,” she said, “we tend to be more open and understanding to everyone — and that helps all of us.”

Healthcare Heroes

Health/Wellness Administrator

Medical Director, Holyoke VNA Hospice Life Care

Alicia Ross

Alicia Ross

This Administrator Has Been a Pioneer, a Mentor, and an Inspiration

By Mark Morris

Growing up in the Philippines, Alicia Ross always hoped to become a doctor. Her father, a dentist, had other plans and wanted his daughter to take over his practice.

“I didn’t want to go into dentistry, so I went into medicine,” Ross recalled. Shortly after graduating from Manila Central University and passing her medical boards, she emigrated to the U.S.

In 1971, Ross joined the staff of Holyoke Medical Center, specializing in hematology and oncology. At the time, she worked with cancer patients, with the single goal of healing them. But for patients with advanced cancers, doctors can often reach a point where there are no more treatment options. Ross understood those patients needed something else.

“It’s huge for the patient to be reassured they’ve done all they can do to fight their illness. It’s also just as important for family members because they will remember this for the rest of their lives.”

“We had to refocus our goal,” she said. “For those cases, instead of a cure, we would instead work toward comfort measures for the end of life and do our best to ease their pain.”

So began what could be called a new career for Ross, or at least a new, exhilarating, and rewarding chapter in a remarkable — and ongoing — career. In 1991, she would become the founding medical director of Holyoke VNA Hospice Life Care.

Over the past 30 years, she has changed countless lives, and not just those who come under her care. Indeed, as an administrator, she has been a leader, a mentor, and an inspiration to those she has worked with, primarily by challenging them to continuously find ways to bring comfort and, yes, quality of life to those in hospice care.

“Someone referred to Dr. Ross as a ‘pioneer,’ and I think that is a very apt term for her,” said Maureen Groden, director of Hospice and Palliative Care, adding that Ross has changed the way many think when they hear that word ‘hospice,’ and she has spent her career educating and innovating.

Alicia Ross says many people recoil at the idea of hospice without realizing what a benefit it can be.

Alicia Ross says many people recoil at the idea of hospice without realizing what a benefit it can be.

Jennifer Martin, director of Operations and IT for Holyoke VNA Hospice Life Care, agreed.

“As medical director, Dr. Ross has always been our go-to; she is the backbone of the hospice program,” she said. “In our weekly team meetings, she goes above and beyond to make sure we provide the absolute best care for every patient and every situation.”

Those sentiments certainly help explain why Ross has been named a Healthcare Hero for 2021 in the always-competitive Administration category. Over the years, that honor has gone to those who don’t simply manage, but lead; those who not only care for those in need, but inspire others to reach higher and find ways to continually improve that care.

Ross certainly continues that tradition.

 

Life-changing Decisions

Getting back to that word ‘pioneer,’ it is used to describe those who break new ground and blaze a trail for those who would follow.

As Groden said, that term suits Ross because of the way she studied hospice care and adopted best practices, but also because she sought to keep raising the bar in all aspects of this field of healthcare.

Turning back the clock to the late ’80s, Ross said she traveled to England to study under Dr. Cicely Saunders, considered the founder of the modern hospice movement.

“Before we started our hospice services in Holyoke, I went to England to better understand how they did it,” she told BusinessWest. While she worked primarily with the doctor’s staff, Ross also met with and learned from Saunders herself.

Ross turned her knowledge into action in 1990, joining others in creating Holyoke VNA Hospice Life Care. They did so, she said, with a simple philosophy: that “dying is a part of living.”

With hospice care, it’s possible to bring dignity and acceptance to patients and families when they are making difficult decisions about end-of-life care. But it is never an easy conversation.

“We still see patients who have a strong negative reaction to the word ‘hospice,’” Ross said, adding that this is unfortunate because people who could benefit from hospice care are not always referred early enough to enable them to gain some benefit from it.

“In addition to nurses who provide pain relief, hospice also offers other services to make a person’s last days more comfortable,” she noted. “Home health aides, chaplains, social workers, even volunteers can all bring comfort to the patient.”

No matter what faith a person follows, she added, the chaplain’s role is part of providing comfort and pain relief. “During this time, many patients have emotional and spiritual pain. When the chaplain can reduce some of that emotional pain, it also eases some of the physical pain.”

Volunteers also play an important role. While COVID restrictions have curtailed in-person visits to patients, volunteers also make an important contribution in providing comfort.

“We try to match volunteers to the patient,” Ross said. “For example, if the patient is a veteran, our volunteer is a veteran.” By aligning interests, the volunteer becomes a welcome face and often develops a friendship with the patient.

Administering medicine is an important part of hospice, but there are often non-medical ways to ease a patient’s pain. Ross gave an example of how a patient with lung disease will regularly experience shortness of breath.

“While morphine is a good treatment, oxygen is too, so a fan blowing in the room can be very effective,” she said, adding that anxiety also contributes to difficulty in breathing. “Many patients feel they are burdening their family, so we work on lessening their stress and anxiety to help them understand they are not a burden on their family.”

According to Groden, family members often struggle and wonder if they’ve done the right thing in referring a loved one to hospice. She said Ross approaches that conversation by reassuring the family that, at this point in time, additional treatments would actually cause more harm than good, and that hospice is the most compassionate approach.

“It’s huge for the patient to be reassured they’ve done all they can do to fight their illness,” Groden said. “It’s also just as important for family members because they will remember this for the rest of their lives.”

While modern medicine can extend people’s lives, many still need hospice in their later years. Ross also pointed out that hospice is not just for the elderly. “We have a lot of illnesses that can affect relatively younger people, like Lou Gehrig’s disease, early-onset dementia, and, of course, cancer, which affects people at all ages.”

No matter the age, she noted, the goal of Hospice Life Care remains the same. “Our main purpose is to give patients comfort through the end of life, to make them as comfortable as possible, and treat their symptoms so they don’t suffer.”

After 50 years at Holyoke Medical Center, 30 of which were at Hospice Life Care, Ross has certainly seen many changes in healthcare. She listed electronic medical records and advancements in medication as two of the most significant.

While many physicians choose to retire rather than confront new technology, she took time to learn electronic medical records and embraced the advances in both technology and medicine. Her colleagues say she never misses a beat, one of the reasons she’s an effective leader and healthcare provider.

At the urging of her husband, Ross had planned to retire by 2015. But when he became ill in 2014 and passed away quickly, she decided to continue her work.

“I thought if I retired, I would only sit around the house and mourn, so a better choice was to keep working,” she said, adding that, with each life she impacts, she embraces that decision.

 

A True Leader

Martin observed that Holyoke VNA Hospice Life Care admits approximately 275 patients to hospice each year.

“When you multiply that number times 30 years, it gives you an idea of just how many lives Dr. Ross has touched,” she said, adding that her lasting impact is measured not in numbers, but in words, especially those used by family members of patients to describe the compassionate care they received.

Those words convey many things, including just how much of a pioneer she has been throughout her career, and how she has convinced so many that dying really is a part of living.

Mostly, though, they convey that she is a true Healthcare Hero.

 

Special Coverage Wealth Management

Dollars and Sense

 

There are many myths concerning money, with many of them transcending generations of people in the same family. The truth is that many of these myths — including the one about how money will make you happy and solve all your problems — are false. Worse, these myths tend to limit one’s thinking and limit their financial success.

By Charlie Epstein

 

Most people do not realize they have myths about their money.

And even more people don’t take the time to analyze where these myths come from and why people hold them to be true.

I have worked with thousands of people over the past 41 years as a financial advisor. In the process, I have identified 15 myths people have about their money, which limit their financial and personal success.

A myth is defined as “an unproved or false collective belief that is used to justify something.” The biggest myth we have about money is that “it will make me happy and solve all my problems.”

Do you think money makes you happy?

Are you sure? Want to bet?

Did you know that 90% of all lottery winners go bankrupt within three to five years of winning the lottery? I’m talking millionaires. And the majority have stated they wish they never won the money. They’re miserable, depressed, and suicidal. How can this be?

“I am convinced that your money myths limit your thinking and impact how you approach your life and your finances.”

This happens because the most important thing in their life has been to get money, and now that they have it, they have no idea what to do with it. They often go on a massive shopping spree and buy all sorts of material items that don’t bring any lasting joy or fulfillment. And, more importantly, they stop working or doing anything productive to give their life purpose, meaning, and real value. What they fail to do is stop and ask themselves, “beyond money, what makes me happy?”

I am convinced that your money myths limit your thinking and impact how you approach your life and your finances. The three biggest financial myths most people have are:

1. My home mortgage needs to be paid off when I retire so I don’t have a payment;

2. I’ll be in a lower tax bracket when I retire; and

3. My home is an investment.

My father believed all three of these myths. When he retired, he and my mother moved to Florida to build the house of their dreams, on the golf course of his dreams. He was going to pay cash for that house — $500,000. He was 68 at the time. I said, “Dad, I want you to take out a mortgage instead.”

My dad was shocked. “A mortgage! For how long?”

I said, “for 30 years.”

“Thirty years!” my Dad bellowed. “I’ll be dead before it’s paid off!”

“So what do you care?” I smiled. “You’ll be dead!”

To which my father asked, “what will your mother do?”

I said, “she doesn’t play golf, and she doesn’t play mahjong, so if you die before her, I will sell that house and move her back north!”

I convinced my Dad to put $100,000 down and finance the other $400,000 with a 30-year mortgage at 5%. This was 1992. Bill Clinton had come into the White House and raised the marginal tax rate from 36% to 39.6%. There went money myth #2 — the belief he would be in a lower tax bracket when he retired (a belief I am sure many of you reading this article share).

That didn’t happen. The good news was, he could write off and deduct 40% of his mortgage payments in the first 15 years because it was all mostly interest. My dad was now ‘leveraging’ other people’s money (OPM) by using the bank’s money to take out a mortgage, and Uncle Sam’s money (USM) by deducting 40% of his mortgage payments.

The net cost for my dad to borrow the bank’s money was 3% (5% x 40% = 2%, which he could deduct, so his net cost to borrow that money was 3%). I said to my parents, “If I can’t make you net more than 3% on your $400,000, fire me as your financial advisor.” We averaged 7% to 8% on their money for the next 13 years of his life.

When my dad passed away, I sold my mother’s home in Florida, at a $100,000 loss. This was 2005, and the real-estate market in Florida was overbuilt, and no one wanted to be on a golf course. So much for the third money myth about your home being an investment. I than moved my mother back north and built her a home in an over-55 community. She was 79 at the time, and she said to me, with a twinkle in her eye, “son, do I get to take out a mortgage?” My mother is now 94, and she still has a mortgage — at 2.5%.

What does my mother care about? She only cares that she has enough money to pay for everything she desires to do. What do I care about? That I’m not tying up her money in a ‘dead asset’ — her home. She can’t eat it or drink it, and it doesn’t generate any income for her. And it is not an investment. I know I can make more than 2.5% on her money by using OPM to generate her even more income.

The key to being financially successful with your money is to understand how to maximize OPM and USM to make money on ‘the spread.’ The spread is the difference between what it costs to use other people’s money and what you can make investing your money somewhere else.

Let me add one big caveat to this discussion. If, psychologically, you must have your mortgage paid off so you can sleep at night … then pay it off. I always say psychology trumps economics. Just remember, you may feel good having it paid off, but economically, you won’t make as much of a return on your money and your assets.

 

Charlie Epstein is an author, entertainer, advisor, entrepreneur, and principal with Epstein Financial. He also presents a podcast, Yield of Dreams; yieldofdreams.live; (413) 478-8580.

Community Spotlight Special Coverage

Community Spotlight

By Mark Morris

Russell Fox (left) and Karl Stinehart say Southwick benefits from its recreational amenities

Russell Fox (left) and Karl Stinehart say Southwick benefits from its recreational amenities, but needs commercial and industrial development as well.

When they talk about managing their town into the future, officials in Southwick emphasize the word “balance.”

In order for the town to remain a desirable place to live, said Karl Stinehart, chief administrative officer, there needs to be a combination of housing and recreation areas as well as commercial and industrial development.

“We like to point out that Southwick is a recreational community,” he noted. “We also want to make sure our zoning allows for commercial and industrial developments because the taxes they contribute will keep our town an affordable place to live.”

Russell Fox, vice chair of the Southwick Select Board, reinforced the recreational community description by pointing to the Congamond Lakes, which make up nearly 500 acres of recreational space in town. “Also, the Southwick Rail Trail has become a gem in our community, running 6.5 miles through town.”

Another big recreation activity happens at the Wick 338, the popular motocross track that hosted a national event in July and drew more than 30,000 people to Southwick.

In recent years, living at the lakes has become more desirable, and, as a result, prices for houses and lots are skyrocketing. As lake property increases in value, it also drives up the tax bill for residents there.

“I’m concerned about the retirees who have lived on the lake for years who may now have trouble staying in their homes because of the tax increases,” Fox said. “If we can attract more business to Southwick, we can help offset that tax burden.”

One company, Carvana, proposed to build a 200,000-square-foot facility off Route 10 and 202 in Southwick. Carvana is a website that allows consumers to buy used cars completely online and have them delivered to their home. The $100 million facility would have stored, repaired, and cleaned cars for delivery across the Northeast. Carvana projected the Southwick site would have employed 400 people and paid $900,000 each year in property taxes to the town.

The project was initially approved by the town’s Planning Board and Select Board, but hit a snag when a local group called Save Southwick strongly opposed the facility. In a series of public meetings, the group cited concerns about safety, traffic, and burdens on the town’s infrastructure. As the project became more controversial, Carvana withdrew its proposal this summer.

To kill the project that late in the process was frustrating for some, but Fox looks at the Carvana situation as a learning experience for everyone involved.

“It became clear from a vocal group that if a project is too big, they won’t support it,” Fox said. “Even those opposed to Carvana learned how government works, so if that encourages more civic engagement, then we’re all for it.”

Stinehart said the town is currently developing a new master plan that includes a process to allow earlier citizen input on zoning decisions to avoid episodes like Carvana in the future.

“The idea is to have these discussions sooner rather than later when we are considering a project,” he explained. “This also gives citizens an opportunity to learn more about the laws and the process of getting things done.”

 

Responding to a Crisis

When the pandemic struck last year, Southwick was still able to keep the town’s services running.

“All our departments in town continued to provide services and got us through the height of the pandemic by being flexible and adaptive,” Stinehart said.

The Town Hall building where many municipal functions are located remained open for most of the pandemic. Like towns everywhere, Southwick relied on remote online platforms like Zoom for meetings when necessary.

In March 2020, Southwick was one of the first communities to hold a town meeting outside. Because Southwick has an open-meeting form of government, Fox explained, a town meeting was held in the Southwick High School parking lot.

The west side of the Greens of Southwick

The west side of the Greens of Southwick is almost full, while homes on the east side have yet to be constructed.

“It was a special meeting with one agenda item, the decision to treat the lakes with alum,” he noted. Alum — or aluminum sulfate — is commonly used to keep algae blooms down and improve water quality. “The timing was important because we had to treat the lakes by the first week of April, otherwise the alum would not be effective.”

In 2020, Stinehart noted, it was especially important to make the lakes usable. “People couldn’t wait to get outside and do something recreational, so we made sure the lakes were ready for the summer.”

Southwick at a glance

Year Incorporated: 1770
Population: 9,502
Area: 31.7 square miles
County: Hampden
Residential Tax Rate: $17.59
Commercial Tax Rate: $17.59
Median Household Income: $52,296
Family Household Income: $64,456
Type of Government: Open Town Meeting; Select Board
Largest Employers: Big Y; Whalley Computer Associates; Southwick Regional School District
*Latest information available

People also spent more time in their yards, which benefited Southwick farmers. Fox said area farms sold more plants for flower beds than ever before in 2020. “Most plants sold out early because people were stuck at home and wanted to get outside to do things in their yard.”

The pandemic also delayed the full celebration of Southwick’s 250th anniversary from happening in 2020. After a kickoff event on New Year’s Eve in 2019 that brought out hundreds of residents and featured fireworks, an outdoor event in February 2020 followed, featuring ice sculptures. Then the pandemic kicked in and put further events on hold.

On Nov. 7, the actual 250th anniversary of the town’s founding, officials in Southwick arranged a call with officials in Southwick, England. That was followed by a parade that traveled through all the neighborhoods in town.

“It was a rolling parade that was well-received because people could go out their door or to the end of their street to see it,” Stinehart said. “The people in town really appreciated it.”

The 250th celebration still has one event remaining, a full parade for people to attend on Oct. 16 with fireworks later that evening at Whalley Park. Fox called the October events a “belated birthday celebration.”

Both Stinehart and Fox have been impressed with the interest in the anniversary, as more than 50 residents joined the organizing committee for the 250th celebration.

“We had a good mix of people on the committee, some who had just moved to town and others who have lived here their entire lives,” Fox said.

Stinehart quickly added, “no other committee in town has that kind of turnout.”

As the town gradually makes its way out of the pandemic, Stinehart mentioned a regional grant program undertaken with the town of Agawam to provide microlending for small businesses.

The town treated the Congamond Lakes in the spring of 2020

The town treated the Congamond Lakes in the spring of 2020 to improve water quality for people clamoring to enjoy the outdoors during the pandemic.

“We are encouraging small businesses that need help to apply for these grants,” he said, adding that Agawam is the lead community on the grant.

Looking forward, Stinehart hopes to use funds from the American Rescue Plan Act (ARPA) to address water and sewer projects in Southwick. Fox spoke in particular about a water-pressure situation town leaders are hoping to address with the ARPA funds. He said projects like this sound like mundane details but can have real and lasting impacts on the town.

“If we address the water-pressure problem, it improves our fire-protection ability and ultimately affects homeowners’ insurance rates for residents,” Fox added.

 

Places to Call Home

The town has more new homes in the works, most notably the Greens of Southwick, where new, homes are being custom-built on each side of College Highway on the property of the former Southwick Country Club. The west side of the Greens development is nearly full, while construction on the east side has not yet begun.

Stinehart said he would like to leverage ARPA funding to increase broadband infrastructure in Southwick. In a separate effort, the town has met with Westfield Gas + Electric’s Whip City Fiber division to explore the feasibility of fiber-optic internet service for Southwick.

To address future energy savings for the town, Southwick has applied for a Massachusetts Green Community designation which would make it eligible for grant funding on a number of energy-efficient projects.

The tax rate for Southwick is scheduled to be released in the fall, and Stinehart said the goal is for a single uniform rate that will be competitive with other communities “because that’s good for business.”

Despite the issues around Carvana, Fox added, Southwick has welcomed plenty of new businesses and has seen expansion for some already there.

“By letting everyone know Southwick is open for business, we can keep this beautiful place where people want to live,” he said. “It’s all about that balance.”

Wealth Management

How the Pandemic is Reshaping This Decision for Americans

By Jean M. Deliso, CFP

 

After a year of Zoom calls, a deadly virus, inflated real-estate values, and a crazy stock-market surge, many Americans, mostly Baby Boomers, who can afford to retire are taking the plunge.

This pandemic caused mayhem for everyone. It drove the healthcare industry almost to collapse, families lost loved ones prematurely, parents became teachers, and many businesses did not survive. But amid all the gloom and doom was a silver lining for many. The government became efficient with quick economic actions, families re-evaluated the benefits of family time, pollution got a brief time out, and businesses became more electronically efficient, to name a few.

Through all the challenges, people took time to re-evaluate their priorities in life. Many are choosing to rethink their future and what is important to them going forward. In fact, about 2.7 million Americans 55 or older are contemplating retirement years earlier than they had imagined because of the pandemic, according to a Bloomberg report. Between increasing retirement-account values, those lucky enough to have pensions, an increase in home values, and government funds that have been put back into the economy, retirement is happening sooner than expected for many.

Jean M. Deliso

Jean M. Deliso

“Whatever your circumstance, achieving your retirement objectives will not happen automatically. The earlier you start planning, the better off your chances are of enjoying a happy, fulfilling, and long retirement.”

As a certified financial advisor, I have met with many individuals contemplating retirement who have decided “enough is enough — life is too short.” Some reasons include a scare with cancer five years ago that made my client reconsider his commitment to climbing the corporate ladder, or “I’m just not happy doing what I’ve been doing for years; it’s no longer fun.” Potential retirees have either saved enough or have decided to spend less in their retirement years.

In contrast, many Americans who were pushed out of their jobs by the economic slide of the pandemic had to take an early retirement against their wishes. This has resulted in them receiving lower Social Security benefits and pension amounts. Twenty-two percent say the pandemic has forced them to spend their emergency savings, 10% have reduced their retirement-plan contributions, and 12% have withdrawn money from their retirement accounts, according to a survey by the National Institute for Retirement Security.

Unfortunately, both scenarios have resulted in increased stress to Americans in the workforce regarding retirement. None of us know our date of death, which makes retirement planning tricky for most.

Too many Americans rely solely on Social Security. This pandemic proved that those benefits do work; checks were consistently received by Americans as the pandemic raged around them. This experience shows that the Social Security system works. Also, checks were sent to those who couldn’t find jobs.

Whatever your circumstance, achieving your retirement objectives will not happen automatically. The earlier you start planning, the better off your chances are of enjoying a happy, fulfilling, and long retirement. Here are a few steps to consider for a successful retirement:

1. Determine your cost of retirement. This includes your monthly living expenses, your age to retire, and your life expectancy.

2. Apply your income sources. Review what you will have available to you, such as Social Security, pensions, immediate annuity payments.

3. Withdraw from your portfolio assets. Take withdrawals against your portfolio assets to make up any difference needed. These assets may include brokerage accounts, money-market accounts, 401(k)s, 403(b)s, IRAs, and annuities. (Withdrawals may be subject to regular income tax and, if made prior to age 59½, may be subject to a 10% IRS penalty. In addition, surrender charges may apply.)

4. If necessary, consider changes. If, after steps 1-3, you are falling short on your plan, consider changes such as saving more, redefining your retirement age, or considering part-time employment during retirement.

5. Consider a professional. This can help you clarify your goals and objectives in retirement.

 

Jean M Deliso, CFP is a financial adviser offering investment-advisory services through Eagle Strategies LLC, a registered investment adviser.

Wealth Management

And When It Comes to Investing, That’s Not a Good Thing

By Jeff Liguori

 

Malcolm Gladwell, prolific non-fiction writer, journalist, and podcaster, has written extensively about mastering a subject. In his book Outliers, Gladwell builds upon the idea that it takes a person 10,000 hours to become a master, or expert, at something.

The premise was originally put forth nearly 50 years ago by two academics, Herbert Simon and William Chase, and published in the American Scientist specifically to address how one becomes an expert chess player. Gladwell elaborated on the idea by saying that an innate ability, or even exceptional intelligence, on a particular subject was not enough to excel or master that subject. In an article he wrote for the New Yorker in 2013, he stated “nobody walks into an operating room, straight out of a surgical rotation, and does world-class neurosurgery. And second — and more crucially for the theme of Outliers — the amount of practice necessary for exceptional performance is so extensive that people who end up on top need help.”

Today it seems that expertise is under attack. Whether it is climate science, economics, or healthcare. There are no hurdles to gathering information, factual or not, which has emboldened many to opine on, and in some instances act on, areas for which they are not equipped. Being informed and questioning authority is not a bad thing. But acting as an expert has the potential for serious long-term damage.

Let’s break down the 10,000 hours concept. A young woman decides on majoring in accounting her junior year in college. She has four semesters until graduation, where most of her classes are related to her major. Let’s assume that is a total of 100 hours of study. She graduates, gets a job in a major accounting firm where she likely works 50 hours per week. At night she studies for her CPA exam. After three years, between college study, work, and prepping for the CPA, she has logged approximately 3,200 hours of work in a single subject: accounting.

And it is likely in a specific area, either audit or tax work. At 25 years of age, she is about one third of the way toward the 10,000-hour rule. This is precisely why a business or individual, with complex accounting issues, would not hire a young person with that level of experience. The analogy could be made for doctors, lawyers, or diesel mechanics as well.

In the investment field, the information needed to manage one’s money is widely available. I’m not aware of a network that dedicates 24 hours to the practice of medicine. But turn on CNBC and it is a non-stop barrage of stock quotes and ideas, complete with bright colors, loud voices, and blinking lights. It thrives on our culture of excitement and reality TV.

Almost anyone with a decent Internet connection can invest his or her hard-earned funds. And early success reaffirms the dangerous bias that ‘I’m a talented investor.’ Until one morning, inevitably, that “hot stock” that had appreciated 78% is down 50% before the market even opens because the drug the company produced killed people in the FDA trial, or the company missed earnings by a wide margin, or the CEO was a fraud. Much of which could’ve been fleshed out by skilled analysis and a disciplined approach to investing to avoid such scenarios.

There is nothing inherently wrong with the do-it-yourself trend. However, the intersection of social media, and the assault of information from a variety of sources (some questionable), has empowered many to shun traditional expertise that has been built upon years of study. Logging on to WebMD to diagnose your poison ivy or watching a YouTube video on installing a garbage disposal, or even learning about a public company’s business on Yahoo! Finance is smart. Reputable sources with solid information. But these are part-time tasks, which don’t carry significant consequences if done incorrectly. They are suited for the curious individual with a penchant to learn.

But for more complex matters, requiring a longer success horizon — say preserving your retirement funds to support your lifestyle once your earning years are over — it is best to leave that to a full time, educated, disciplined professional. They’re called experts.

 

Jeff Liguori is the co-founder and chief Investment officer of Napatree Capital, an investment boutique with offices in Longmeadow as well as Providence and Westerly, R.I.; (401) 437-4730.

Banking and Financial Services

Developments of Interest

By Mark Morris

John Howland calls the recent flood of deposits an “unprecedented” situation.

John Howland calls the recent flood of deposits an “unprecedented” situation.

John Howland admits that the word ‘unprecedented’ is overused these days. But for him and others in the banking business, it seems like the right word to describe all that’s going on.

Howland, president and CEO of Greenfield Savings Bank, was talking specifically about the record amounts of deposits flooding into banks — and what’s happening with those deposits, or not happening, as the case may be.

In the early months of the pandemic, from January to June of 2020, banks in the U.S. saw a surge of nearly $2 trillion in deposits. At that time, most people were staying close to home and had reduced their spending to necessities.

As a local example, PeoplesBank reported deposit increases of 33% since last April, or nearly $700 million in additional deposits.

More deposits arrived as businesses applied for Paycheck Protection Program (PPP) loans and consumers received stimulus checks from the government. During normal times, money gets deposited but does not stay in an account for long. These days, however, deposits are staying and growing to an extent Howland and his counterparts in Western Mass. have never seen before.

And while record deposits would seem like a good thing, all that cash is sitting still, for the most part, and the key to any bank generating revenue and earning profits is loaning its deposits out to borrowers.

“I never thought I would say there are too many deposits and not enough people to lend the money to,” said Tony Worden, president and chief operating officer of Greenfield Cooperative Bank. “The point of our business is to get deposits … so this goes against everything we were taught.”

In normal times, banks take in deposits and lend that money out to businesses and individuals. Balancing the number of loans to deposits helps determine what interest rates will be paid to savers and charged to borrowers. Banks profit on the difference between the two.

“I never thought I would say there are too many deposits and not enough people to lend the money to. The point of our business is to get deposits … so this goes against everything we were taught.”

But these are certainly not normal times. These days, banks have record deposits and diminished loan demand — for several reasons, which we’ll get into later — which translates to lower interest rates for savers and borrowers, as well as lower profits for banks.

Howland pointed out that the lower interest rates are great news for people looking for a business loan or a mortgage.

“The residential and commercial rates are down to levels that were inconceivable 10 years ago,” he said, adding that, moving forward, banks will be competing much harder to entice people to borrow money than deposit it.

 

By All Accounts

There are many theories as to why deposits have soared at area banks — and why those deposits are going largely untouched.

Dan Moriarty, president and CEO of Monson Savings Bank, suggested that once people tightened their spending during the pandemic, they may have changed their overall spending patterns, which is in many ways good for consumers, but not for the overall economy.

“It’s good for consumers to increase their savings and their capacity to have money, but it also slows down the economy,” Moriarty told BusinessWest. “We believe there is still some pent-up rebound spending by both consumers and businesses that we will be seeing.”

Howland agreed, noting that there are a number of reasons contributing to the surge in deposits, with one of them bring what he called a “flight to quality.”

“With all the uncertainty in the world, people understand that putting their money into a bank where their deposits are insured by the FDIC is one of the safest moves you can make,” he said, adding that, despite the consistently upward movement of the stock markets, many consumers are seeking a safe harbor in which to park their money.

Tony Worden says he never expected there to be too many deposits and not enough people to lend to.

Tony Worden says he never expected there to be too many deposits and not enough people to lend to.

As for the business of converting those deposits into loans — and revenue — many of those same factors are holding some consumers back from borrowing, said those we spoke with, although many have pressed ahead with purchases of new cars, new homes, and vacation homes.

Meanwhile, a number of businesses, still struggling to fully recover from the pandemic, are being cautious about moving ahead with expansions or new ventures. And for those that have the confidence to move forward, the current workforce crisis is keeping them from doing so.

Indeed, Worden said the current labor market is affecting activity in commercial lending. “We have businesses that can’t take on all the jobs they want because they don’t have enough staff to get them done.”

Moriarty agreed, but spoke optimistically about the prospects for improvement when people return to the workforce in large numbers. “Once our businesses can hire the staff they need and expand their products and services, they may look to the banks to borrow and grow.”

The surge in deposits and frustrating inability to put much of them to work has been one of many stories to unfold during what has been a challenging — and very different — year for area banks.

They all played a key role in helping businesses apply for PPP loans when they became available last spring. During two rounds of PPP loan offerings, Moriarty said, Monson Savings processed 565 loans totaling nearly $50 million.

In the early days of the pandemic, qualifications for PPP loans included every small business that was affected by COVID-19. Tom Senecal, president and CEO of PeoplesBank, said many applied because they didn’t know if they were going to be impacted.

“It’s good for consumers to increase their savings and their capacity to have money, but it also slows down the economy. We believe there is still some pent-up rebound spending by both consumers and businesses that we will be seeing.”

“There were many businesses that thought they were going to be hit hard but really weren’t,” he noted, giving an example of construction companies that were closed early in the pandemic but were then designated as essential and allowed to reopen.

Worden added that many companies that received PPP loans in the first round didn’t touch the money until it became clear their loan would be forgiven by the government. Once they figured out how to get loan forgiveness, they didn’t sit on the next round.

“We’ve had around 96% of our first- and second-round PPP loans forgiven with no denials,” he said. “The only ones who haven’t been forgiven have all started the process.”

All the bankers who spoke with BusinessWest said they were grateful to process PPP loans for area businesses. Worden said the urgency to get the first-round applications done required an “all hands on deck” approach that brought in many outside the loan department. His story reflects similar efforts from the other banks.

Dan Moriarty

Dan Moriarty says the pandemic changed people’s spending patterns, which may not be good for the overall economy.

Another dominant story during the pandemic was the real-estate boom, driven in part by record-low interest rates. Moriarty said activity on the buying and selling side has been brisk for some time. “We’ve seen a lot of activity where people are moving into a new house or buying a second home, whether it’s for vacation or an investment.”

The low interest rates have also brought a significant increase in people looking to refinance their mortgage.

“While it’s smart for people to refinance their current debt to get a lower rate, it doesn’t necessarily create new funds for the bank,” Worden said.

In early 2020, Monson Savings opened a new branch in East Longmeadow to increase its access to more companies and consumers. Moriarty admitted he had some anxiety about the timing.

“We made the decision back when no one predicted the pandemic would last so long,” he said, noting that, after a soft opening in August 2020, the branch has performed far above its forecasted numbers. “We’ve seen deposits increase 40% to 50% from when we opened.”

 

Bottom Line

All the bankers we talked with agreed the next three to six months will give everyone a better idea of where the economy, COVID, and the prospects for area banks are headed.

“I think we need to focus on getting through these next few months, and let’s get through the Delta variant,” Worden said. “We all have short-range goals, but we’re also keeping our eye on the long range.”

And that long-range forecast will hopefully call for taking that surge in deposits and putting it to work in ways that will bolster the local economy.

Banking and Financial Services

Know the Rules

By James T. Krupienski, CPA

 

At the start of the COVID-19 pandemic in the early parts of 2020, the concern of business survival was the number-one thought of countless businesses, with each industry having its own struggles. The medical industry was not without its own real concerns at that time, particularly given its role in the pandemic fight. People would continue to get sick, require treatment, and see their physicians, but how could it be done safely?

Recognizing the financial crisis that was about to overtake this industry, along with how detrimental it was for the industry to remain open and accessible to patients, the federal government took dramatic steps. In addition to Paycheck Protection Program (PPP) loans, for which medical practices were eligible, the Coronavirus Aid, Relief and Economic Security (CARES) Act also allocated funds directly to the medical industry through the Department of Health and Human Services (HHS) and the newly created Provider Relief Fund (PRF).

James T. Krupienski

James T. Krupienski

“While the COVID-19 relief provisions, as part of the CARES Act, provided a lifeline for many medical, dental, and other healthcare-related practices during the pandemic, that support was not without certain compliance requirements and reporting.”

The first round of funding, which was completely unexpected to many, occurred in early April 2020, when $30 billion was deposited directly into the accounts of eligible practices. Throughout 2020, additional funds were later rolled out in phases 2 and 3, as well as through targeted distributions to specific industries, such as rural providers and skilled-nursing facilities. Of importance is that, for all practices receiving these funds, there are several rules to be followed.

While the COVID-19 relief provisions, as part of the CARES Act, provided a lifeline for many medical, dental, and other healthcare-related practices during the pandemic, that support was not without certain compliance requirements and reporting, which we will dive into within this article.

 

Attestations

First, within 90 days of receipt of the funds, each provider was required to attest to certain terms of use. For those electing to return the funds, it was required to be done within 14 days of this attestation. Attestations were required for receipt of funds in all phases and were to be completed through use of a portal with the HHS (www.hhs.gov/coronavirus/cares-act-provider-relief-fund/for-providers/index.html#how-to-attest).

 

Reporting

As part of the attestation process, any provider receiving more than $10,000 in payments through the PRF would be required to report on use of the funds. While the specifics on the exact reporting took months to be finalized and continued to be reworked by the HHS, the general guidelines were known. Barring no future changes, PRF dollars are to be applied in the order of:

1. Certain qualifying expenses that can be directly attributable to coronavirus; and

2. Lost revenues.

Of greatest importance is the understanding that the use of these funds must be kept separate and distinct from the use of other coronavirus-relief aid. For example, if you report on the use of a personnel or payroll related expense, it cannot also be tied to dollars used in applying for PPP loan forgiveness. Essentially, a practice cannot ‘double-dip.’

Initially, reporting was set to begin back in the summer of 2020, which was then pushed to the fall of 2020 and then again to Jan. 15, 2021. However, because of updated legislation and a change in administration, reporting had been delayed even further. In late June 2021, the reporting requirements were finalized, and the reporting portal is now open to many, depending on when funds were received (see chart).

For all recipients of the fund, it is important to continue to monitor this process so that a reporting deadline is not missed. To stay on top of this process, the HHS has been updating its site (www.hhs.gov/coronavirus/cares-act-provider-relief-fund/reporting-auditing/index.html) with current regulations.

 

Audit Requirement

One stipulation, not known to many, is that a government single audit is required if the combined federal funds (PRF and other federal assistance) received were more than $750,000. Note that PPP funding does not count towards this total.

A single audit would be required of an organization that has $750,000 or more in federal awards. While typically, federal funding is awarded to not-for-profits and governmental organizations, the HHS PRF has opened many organizations, including for-profit medical practices, to these compliance requirements. If a practice has received combined federal awards though the Provider Relief Fund in excess of $750,000, a single audit will be required.

While the majority of relief programs under the CARES Act (such as the Paycheck Protection Program) are subject to reporting requirements, the PRF has its own distinct rules to navigate. If your healthcare practice took advantage of the PRF in any amount, it is highly encouraged that you speak with an advisor as soon as possible to fully understand the compliance requirements. Navigating federal compliance can be intimidating and confusing, especially if this is your first time doing so. Speaking with an advisor can demystify this process and help ensure that you understand the regulations.

 

James T. Krupienski, CPA, MSA, is a partner in the Healthcare Services niche for Holyoke-based Meyers Brothers Kalicka, certified public accountants and business strategists; (413) 536-8510; www.mbkcpa.com

Home Improvement Special Coverage

Summer Special

Andrew Crane says the Home Show helps contractors fill their pipeline with future work.

Even though they’re busy now, Andrew Crane says the Home Show helps contractors fill their pipeline with future work.

By Mark Morris

In the old days — prior to the pandemic — when homeowners wanted to make improvements to their property, they called several contractors for competitive bids. Once a contractor was selected, the job would start shortly after that.

Since the pandemic, those days are long gone. Contractors are busier than ever, and building materials have been affected by worldwide supply shortages and price hikes. Now, homeowners seeking a contractor can leave a phone message, but may not receive a call back.

For those reasons and many more, the Home Builders and Remodelers Assoc. of Western Massachusetts is staging a “special summer edition” of the Western Mass Home & Garden Show, usually held each March.

Andrew Crane, executive director of the association, told BusinessWest that, even though contractors are busy, the event (scheduled for Aug. 20-22) fills an important need.

“Many people will research their home project online, but at some point they need to see and touch the products they want and speak to professionals who can get the job done,” Crane said. “The Home Show allows them to move the project forward and not wait for a callback.”

The Home Show also works for contractors because it allows them to fill their project pipeline with future work.

“While most contractors are straight out right now, many don’t know what their business will be like in the coming fall and winter months,” Crane said.

By labeling it a “special summer edition,” Crane made it clear this is intended to be a one-time event. Plans are full speed ahead for the 2022 Home Show in its traditional late-March timing. The summer show is a way to fill the void left when COVID-19 forced cancellation of the 2020 and 2021 editions of the Home Show.

The special edition will be a scaled-down version of the full show, running only three days instead of four and setting up in only one building at the Eastern States Exposition grounds. The smaller event will still look similar to past shows, with booths set up in the Better Living Center and several outdoor displays.

Chris Grenier, owner of Grenier Painting & Finishing, said he appreciates having any version of the Home Show this year.

“I’m very busy right now, but it’s well worth it for me to be at the show because I still need a steady stream of work that I can plan for in the months ahead,” he explained.

Chris Grenier says even a scaled-back show brings value to vendors.

Chris Grenier says even a scaled-back show brings value to vendors.

BusinessWest spoke with a few contractors who have found both short-term and long-term benefits from participating in the show.

Frank Webb Home in Springfield sells a wide range of kitchen and bath fixtures, as well as lighting. Manager Lori Loughlin said taking a booth at the Home Show is well worth the investment.

“We often see a 40% increase in business right after the Home Show,” Loughlin said. “Even though we’re in a busy time right now, that can change, so we want people to keep us in the loop when they plan their kitchen and bath projects in the future.”

For the last five years, Gisele Gilpatrick, project manager for Pro-Tech Waterproofing Solutions in Chicopee, has chaired the Home Show organizing committee. Her company has always done well at the event.

“It’s a chance to meet people one on one and for them to collect business cards,” she said. “People will often call us six months to a year after the show to say they are ready to fix their wet basement.” She also said it’s not unusual to hear from people up to five or six years later.

When Gilpatrick meets people at the Pro-Tech booth, they often share photos with her, but they are not of children and pets. “They bring us pictures of their basements and say, ‘this is what my nightmare looks like,’” she said, adding that an interesting dynamic happens when someone describes the specifics of their wet-basement problem.

Gisele Gilpatrick says the lingering pandemic has forced show organizers to constantly reassess safety protocols.

Gisele Gilpatrick says the lingering pandemic has forced show organizers to constantly reassess safety protocols.

“One person might be telling us their story, and others who overhear become interested in the conversation because they have similar problems in their basements,” she said. “The next thing you know, a group of people are gathered around our booth.”

 

Safety First

While gathering at a booth can be good for business, this year, people will need to take social distancing into consideration when they congregate. The emergence of the Delta variant of COVID has show organizers making constant adjustments to their safety protocols.

“In planning the show, we’ve gone back and forth from wearing masks to not wearing masks as mandates keep changing, so it won’t be a surprise if they change again,” Gilpatrick said.

The maintenance staff at the Exposition grounds have boosted their protocols with more frequent surface cleaning during the show. They have also strongly encouraged people to wear masks. Crane advised, “if you are at all uncomfortable, wear your mask.”

Despite all that, Gilpatrick believes it’s worth attending the show, and for some, the scaled-down version might be easier to navigate.

“The crowds at the March Home Show can be overwhelming for some people,” she said. “This edition of the show will be easier to get around, and we will still have lots of quality exhibitors.”

Lori Loughlin says finding a contractor can be difficult right now

Lori Loughlin says finding a contractor can be difficult right now, and the Home Show can help make those connections.

As people have stayed closer to home for the last 18 months, many have set aside the money they would normally have spent on vacations and going out, and are using those funds instead to make improvements to the inside and outside of their homes, a trend Loughlin said is far from over. “People who are planning home projects now have been looking at their houses for a year and a half, and they are ready to make some changes.”

Crane emphasized the importance of planning and noted that the combination of busy contractors, shortages of certain building materials, and difficulty finding enough laborers all contribute to projects taking more time than in the past.

“Plan as far ahead as you possibly can,” he said. “I don’t want to scare anyone from doing a project, but planning is more important than it’s ever been.”

Grenier said good planning starts with recognizing that everyone is busy right now. “If folks go to the Home Show looking to make an interior improvement, they should plan it as a winter project. If it’s an exterior project, plan for next spring.”

Crane agreed. “The days of getting prices from four or five contractors are going away. If you talk with a contractor who gives you a reasonable price and you have a comfort level with them, sign them up.”

Loughlin said just finding a contractor to start a project is now more challenging. “The Home Show gives people an opportunity to meet contractors they might not have known about who can help them. It’s a chance to meet contractors in person and establish a point person to contact.”

The real opportunity is moving past thinking about a project, to making it happen, she added. “I believe people will come to the Home Show because many are at the point where they’ve done all they can online, and now it’s time to broaden what’s actually possible.”

Crane also emphasized how the Home Show has become a social event. For a $10 admission, it gives people an inexpensive time outside the house. It also allows people to see and touch new products.

“For the low cost of getting into the Home Show,” he said, “you might see that one thing that completes the puzzle of putting together your project.”

Community Spotlight

Community Spotlight

By Mark Morris

Bob Boilard says infrastructure improvements, including a broadband plan for the town, have moved forward during the pandemic.

Bob Boilard says infrastructure improvements, including a broadband plan for the town, have moved forward during the pandemic.

 

Robert Boilard credits people in town working together as the reason Wilbraham has come through the pandemic so far with minimal impact on the community.

“We incorporated our protocols early and have been very fortunate that most people have remained safe from COVID,” said Boilard, who chairs the Wilbraham Board of Selectmen.

Officials from the Police and Fire departments, as well as the town’s public-health nurse, provide weekly updates to the selectmen of the number of positive cases, illnesses, and hospitalizations so they can continue to closely monitor the community’s health.

Boilard pointed to a new DPW garage and a storage facility for the Parks and Recreation department as two projects the town was able to complete during the pandemic. As a community that has received funds from the American Rescue Plan Act (ARPA), the board is hoping to use the money on water-infrastructure projects and expanding broadband internet.

“We have a master plan to install broadband throughout Wilbraham,” Boilard said. “This is a project that will be ongoing for the next few years.”

Another big project on the horizon involves a new senior center. On Oct. 18, Wilbraham will hold a special town meeting to discuss building the facility behind Town Hall. Paula Dubord, the town’s director of Elder Affairs, said she and others have led a 10-year effort for a senior center that can better accommodate the community’s growing senior population.

“Our current location is in a lovely building, but the space is only 3,840 square feet,” Dubord said. “With more than 4,000 seniors in town, it’s just too small.”

The drive for a new senior center began in 2012 with a study committee, which concluded the existing senior center did not meet the town’s needs, even at that time. Next, a feasibility committee was formed and brought in an architect to do a deep dive on what made sense for a new facility. After seven years and consideration of nearly 40 different sites in Wilbraham, the feasibility study recommended building a new structure on municipally owned land behind Town Hall. October’s town meeting will give residents a chance to vote on that recommendation.

“Our current location is in a lovely building, but the space is only 3,840 square feet. With more than 4,000 seniors in town, it’s just too small.”

There were some in town who pushed for locating the new senior center in an available former school. Dubord said the senior center has been located in old schools twice before, and it’s an approach that just doesn’t work.

“The experts who took part in the feasibility study told us a new building was a more practical way to meet the current and future needs for Wilbraham residents,” he said.

 

Booming Population

When the study committee began its work in 2012, members looked at the potential growth in the over-60 population in Wilbraham.

“We projected that, by 2025, nearly 40% of our town — with a population of nearly 15,000 — will be considered a senior,” Dubord said. “We are very close to that projection right now.”

As Wilbraham residents age, she added, many of them say they prefer to stay in their own home or move to one of the 55+ communities in town.

In its current location, more than 100 residents visit the senior center every day. Dubord emphasized that the real goal of the center is to keep people socially connected. Last March, when the pandemic forced the center to shut down, she and her staff quickly found new ways to stay connected with local seniors.

“We immediately started grocery shopping for people and picking up essential items like masks and toilet paper — both of which were hard to get in the beginning — as well as their prescription medicines,” she said.

The staff at the center put their full focus on meeting the needs of Wilbraham seniors, she added. “Because everyone was isolated, we did lots of phone check-ins with people to keep them engaged.”

In the spring, when vaccines first became available for people 65 and older, Dubord and her staff helped seniors sign up online to receive their shots when the state made them available at the nearby Eastfield Mall in Springfield.

“The registration process was not easy for seniors to complete, so we became like vaccination headquarters,” she said. “Because we had done a number of them, our staff was able to quickly get people registered for their shot.”

Dubord estimates they helped nearly 400 residents sign up for the initial vaccine offering. Later, the senior center hosted its own vaccine clinic run by staff from the Public Health and Fire departments.

Grace Barone says Wilbraham businesses are looking forward

Grace Barone says Wilbraham businesses are looking forward to getting back to some semblance of normalcy.

“Through all those efforts, we are confident that everyone who wanted to get a shot was able to get one,” she said.

Like many senior centers in the area, Wilbraham also offed a grab-and-go lunch program when it could not open the center for meals. “The real plus to the grab-and-go was it introduced us to people we’ve never seen before at the senior center,” Dubord said.

Happy to open the doors at the senior center almost three months ago, she said having someplace to go gives people a purpose and plays a key role in our health as we age.

“Many of our seniors live alone, so the center is important because it gives them access to vital community services and for the social connections they make,” she noted. Indeed, according to a Harvard Health study, the negative health risks of social isolation are comparable to smoking and obesity, increasing mortality risk by up to 30%.

Wilbraham at a glance

Year Incorporated: 1763
Population: 14,868
Area: 22.4 square miles
County: Hampden
Residential Tax Rate: $22.96
Commercial Tax Rate: $22.96
Median Household Income: $65,014
Median Family Income: $73,825
Type of government: Board of Selectmen, Open Town Meeting
Largest Employers: Baystate Wing Wilbraham Medical Center; Friendly Ice Cream Corp.; Big Y; Home Depot; Wilbraham & Monson Academy
*Latest information available

While a new senior center can address the needs of Wilbraham’s growing elder population, Dubord said the plan is for the new building to also house services for veterans in town.

“There are benefits for the new center beyond seniors,” she explained. “The larger space can be used by Boy and Girl Scouts, as well as women’s groups or other organizations in town.”

 

Moving Forward

Gradual easing of COVID-19 mandates is also good news for Wilbraham businesses. Grace Barone, executive director of East of the River Five Town Chamber of Commerce, noted that, like everyone else, Wilbraham businesses are looking forward to something resembling business as usual once again.

She pointed to a recent annual meeting of the chamber which more than 130 members attended in person while others joined remotely as an example of gradually getting back to attending events while still staying safe.

“The chamber’s golf tournament at the end of September is another way to get back to networking and taking advantage of the outdoors while we can,” she added.

New to her role at the chamber, Barone has been in the job since late June after working with the Keystone Commons retirement community in Ludlow for the last five years.

“I’m hoping to take what we’ve learned from the past 18 months to help our businesses succeed going forward,” she said. “It’s going to take some time, but we can get there together.”

Boilard shares Barone’s optimism about the future.

“It’s awesome to see how well everyone works together,” he said. “From boards to community groups, they are all focused on making Wilbraham a better place to live.”

Opinion

Opinion

By Brooke Thomson

 

Companies from Facebook to Walmart to Google have begun to mandate that their employees get vaccinated to protect against COVID-19. Restaurants throughout the state have also started to require that guests provide proof of vaccination before eating indoors.

As the Delta variant causes COVID-19 infections to increase throughout the country, there is increased pressure on businesses and employers to protect their employees and customers.

Businesses have an important role to play in addressing the health and economic impacts of this crisis. Our businesses have stepped up in amazing ways in the name of public health during the past 18 months. They have enforced masking requirements, shifted to remote and online commerce, closed down to the public, and been on the front lines of the pandemic.

Now, they are again being asked to take responsibility to stop the spread.

But should businesses alone be in charge of leading on public-health emergencies? While federal, state, and local governments took difficult and important steps to protect public health during the pandemic, government leaders now appear to have taken a back seat, relying instead on the private sector to solve public challenges.

A core duty and primary function of any government is to protect the public’s health and safety. The pandemic highlights the need for governments to take their duties seriously. Our elected officials should provide leadership driven by science and evidence, not partisan politics.

State leaders have an opportunity right now to demonstrate this leadership by adopting statewide mask requirements, limiting gatherings in dangerous situations, and providing guidance for businesses to operate safely. Businesses should be focused on their employees and their customers and take their direction on public health and safety from the officials we elect to guide us.

Leaving public-health decisions to private businesses is not the right answer. It is the duty of state and local governments to protect our health. We need leadership on the pandemic to support our businesses and employers.

 

Brooke Thomson is executive vice president of Government Affairs at Associated Industries of Massachusetts.

Special Coverage Technology

Strong Signals

By Mark Morris

When the pandemic arrived early last year and many companies adjusted to remote work for their staff, it was IT professionals who got everyone up and running from their homes.

Now, as the world begins to move away from the pandemic and companies begin bringing employees back to the office, the demand to hire IT pros is even higher than it was before COVID-19 emerged. And that poses challenges for employers.

In a normal year, said Delcie Bean, CEO of Paragus Strategic IT, the company sees about 10% turnover of people leaving and new staff being hired. During the pandemic, there was no turnover, as every one of the 50 Paragus employees stayed in their job.

In the last four months, however, as the economy has improved and COVID restrictions have eased, Bean has seen a “tremendous transition” among the IT labor force.

“Many of those who are leaving are pursuing remote-work opportunities that didn’t exist before the pandemic,” he said. “Most of these companies are not local and would never have interviewed or offered jobs to these workers in the past.”

Bean cited a number of reasons for the high demand for IT talent. During the pandemic, nearly every company increased their use and dependence on technology, which requires more people to keep systems up and running. As the economy improves, companies are pursuing more projects and thus increasing their need for IT talent. The pandemic also made it acceptable to hire people who work only remotely, creating even more opportunities for IT pros.

“With the increased dependence on technology, an improved economy, and the ability to work remotely, we’re seeing employers do things they would not have done before,” he said.

Joel Mollison, president of Northeast IT Systems, noted that, unlike others in IT support, his 18-person company does not have high worker turnover. He credits that to attracting IT staff who enjoy working with Northeast’s varied client list, which covers sectors from insurance and healthcare to manufacturing, municipalities, and even cannabis.

“Many of those who are leaving are pursuing remote-work opportunities that didn’t exist before the pandemic. Most of these companies are not local and would never have interviewed or offered jobs to these workers in the past.”

One notable challenge to retaining his workforce involves companies such as banks, manufacturers, and other industries that are looking to bring their IT support in-house, he said. “As a service provider in Western Mass., we’re competing against much larger institutions in the region who can pay IT professionals more.”

As security issues receive prominent news coverage, companies worry more about ransomware attacks and similar threats. Mollison believes this is part of the reason firms are increasingly looking for in-house IT staff.

“The larger the business, the more complex their systems are, and the more they need IT professionals to manage them,” he explained.

Bean agreed that IT security issues have increased the pressure for companies to be proactive in preventing major disruptions, pointing out that much of the job growth is the result of companies expanding their internal IT staff both regionally and on a national level.

Delcie Bean says an IT workforce that was remarkably stable in 2020 has entered a time of “tremendous transition.”

Delcie Bean says an IT workforce that was remarkably stable in 2020 has entered a time of “tremendous transition.”

“All these companies are doing this because the growing economy gives them a little more money and it can be a luxury to have your IT support in-house.”

Jeremiah Beaudry, owner of Bloo Solutions, agrees, but believes that, after companies build up their internal IT staffing, they usually return to outsourcing with an external service provider once they realize that internal IT is less cost-effective.

“Instead of paying full-time employees to show up every day, companies can hire an IT firm that knows all the technical details and address specific problems when they arise,” Beaudry said. “It would be similar to bringing a plumber on staff. Why would you do that?”

In fact, he predicts that the hiring surge for internal IT will shake out to one or two positions to oversee the main systems augmented by an outside IT service provider.

Bean said it’s common for companies to have an internal person handling technology issues as well as an outside IT service company. “Our biggest source of new business right now involves partnering with internal IT departments to round out what they are doing and give them supplemental assistance.”

 

Here and There

Like many industries right now, technology is grappling with a job market that significantly favors job seekers. Bean told the story of an employee who had previously worked in the defense-contracting industry 10 years ago.

“Because this employee’s name was still in the defense system, a contractor called him to make a job offer, sight unseen and without an interview,” he said. “They literally e-mailed him an electronic salary offer without meeting him, and it was for $35,000 more than he was making here.”

A company located in a large metro area interested in hiring remote workers will offer salaries that are competitive in their market. This can often lead to small-market workers getting big-city paydays.

“If you’re at home and take five minutes between tasks to turn around to pet your dog or do the dishes real quick, that time becomes meaningful and helpful in your life.”

“Usually, when someone makes a salary that’s attractive in Boston, it comes with the high cost of living in the metro Boston area,” Bean said. “When someone with a Western Mass. cost of living makes that same amount, they can see a 30% net increase in their salary.”

Indeed, more companies than ever are embracing remote or hybrid workforces (see related story on page 25). That means IT service providers face the same dilemma confronting many of their clients: continue to work from home or go back to the office.

Mollison tells a slightly different story. Before COVID, he said, Northeast IT was outgrowing its space in Westfield, so he suggested that staff work remotely as a short-term solution. He was surprised when almost no one wanted to work from home.

“Nearly everyone wanted to work in the office,” he recalled. “We have a kind of think-tank environment where our staff enjoy working on problems together.”

However, the pandemic forced nearly everyone to work from home for the last 16 months, a situation Mollison called stressful because many felt less connected to their co-workers. He added that a change in venue is coming. “We purchased a building in West Springfield and will be moving in at the end of August. We’ll have plenty of space to bring everyone back with social distancing; our people are really looking forward to returning.”

At Paragus, employees have been ramping up their return to the office by coming in one day a week in June, two days a week in July, and three days a week starting in August. Bean said he won’t require more than three days a week in the office, but felt that some time in the office was important.

“We have intentionally designed our office to promote collaboration,” he said. “We don’t have walls or offices, so people can listen to each other and overhear what’s going on. You can replicate some of that online, but it’s not the same as hearing what’s going on around you.”

At Bloo Solutions, Beaudry has allowed his four full-time and several part-time employees to stay remote except for occasional trips to the office or when visiting a client’s location. Collaborative messaging tools like Slack and Microsoft Teams allow him and his staff to stay in touch with each other and stay on top of client concerns.

Jeremiah Beaudry says even companies that have built up internal IT

Jeremiah Beaudry says even companies that have built up internal IT staffing often come to see the value in outsourcing that work.

“We have channels dedicated to each client so any one of us can jump in and take care of any concerns,” he said. “Because we all have access to these messages, the same information is available to all of us without being next to each other.”

Whenever possible, Beaudry makes working from home an option for his staff.

“If you’re at home and take five minutes between tasks to turn around to pet your dog or do the dishes real quick, that time becomes meaningful and helpful in your life,” he said. “When you are in the office and not near anything you need to do, that same five minutes is wasted.”

Therefore, as long as his staff are productive, he doesn’t care if they work from home or at the office.

Another reason Bean cited for having people in the office at least some of the time is to help with their professional development and to identify when a staff member might need help. He worries that IT professionals who have chosen full-time remote work won’t have the same chance to grow or develop their careers.

“They will probably be fine doing the job they were hired for, but they will be relatively unengaged and potentially stagnant,” he said. “I don’t see how they can grow or develop much in an environment where they never see their co-workers or be around other people.”

Mollison credits his low staff turnover to seeking out people who like variety in their work and have an interest in personal and professional growth.

“Because IT folks tend to be introverts, we try to help them grow personally so they can become more comfortable working with clients and developing relationships with them,” he said.

While finding people in Western Mass. with technical skills isn’t so tough, Beaudry makes his hiring decisions based on a candidate’s emotional intelligence.

“I’ve learned over time that clients would rather feel good about a conversation they had rather than having an expert solve the problem who makes them feel bad about themselves,” he said.

 

Change Can Be Good

Another reason the demand for IT professionals is increasing has to do with the growing economy. Bean said the sales pipeline for new projects has never been fuller. “In terms of new business, we’re booking clients out to October because we only book so much at a time.”

In addition to hiring temporary contract workers, he has found another way to make up worker shortages: acquisitions. Paragus recently acquired one IT-support company in Worcester and is looking at two other acquisitions.

“In the past, the goal of an acquisition was to acquire clients and market,” he said. “Now it’s about acquiring talent.”

Would Bean like to see less disruption in the labor force? Sure. He also understands that this time of transition is part of the bigger picture.

“Everybody is moving around, so we’re on the receiving end of this as well,” he told BusinessWest. “The good news is we haven’t seen a shortage of any new résumés coming in.”

While it’s tempting to dwell on the employees leaving, however, Bean has gained some perspective.

“After some reflection,” he said, “we realized that a lot of the innovation and fresh approaches we get are driven by new people coming in with new ideas.”

Community Spotlight

Community Spotlight

By Mark Morris

Mark Pruhenski says Great Barrington

Mark Pruhenski says Great Barrington has seen an influx of new residents during the pandemic.

 

On a summer Friday night in Great Barrington, Mark Pruhenski simply enjoyed the sight of dozens of diners eating outside and the sound of musicians playing from various spots around downtown.

Town manager since 2019, Pruhenski said Great Barrington is fortunate to have weathered the pandemic well. He gave much of the credit to a task force formed early on that included town staff and a strong network of partners, including Fairview Hospital, local food banks, and others who lent support.

With its location in the Berkshires, Great Barrington has long been a popular spot for second homes. During the pandemic, many people relocated to their second homes to get away from populated metro areas and work remotely. As time went on, many decided to make Great Barrington their permanent home.

“Along with those who moved into their second homes, we had hundreds of new residents move to the area,” Pruhenski said. “Folks who enjoyed visiting the Berkshires for culture and entertainment were now permanently moving here.”

Betsy Andrus, executive director of the Southern Berkshire Chamber of Commerce, noted that, even at the height of the pandemic, when restaurants and cultural venues were closed, people were still looking for a place to rent or buy. She believes the consistently low COVID-19 infection rates were a strong part of the town’s appeal.

“Along with those who moved into their second homes, we had hundreds of new residents move to the area. Folks who enjoyed visiting the Berkshires for culture and entertainment were now permanently moving here.”

“People from larger metro areas came to Great Barrington in droves,” Andrus said. “You could not keep a house on the market, with some sales happening in only a few hours. Others took a virtual tour and bought sight unseen.”

While admitting it’s difficult to find positives from a worldwide pandemic, Andrus said one benefit was forcing businesses in town to change the way they had been operating.

“I think we were kind of stagnant before,” she said. “Then, suddenly, our businesses had to put a lot of energy into how they could reinvent themselves.”

In addition to sit-down restaurants figuring out how to become takeout places, Andrus pointed to Robin’s Candy Shop, which could no longer allow customers to serve themselves in the shop.

“They moved the store around overnight, so now the staff gets you everything you want,” she said. “Then Robin’s quickly switched over to online sales, which is no small feat, either.”

Great Barrington used its Shared Streets grant

Great Barrington used its Shared Streets grant to develop an outdoor dining area on Railroad Street.

While Great Barrington saw some stores permanently shutter their businesses during the pandemic, Andrus said COVID was not usually the main reason for closing. In some cases, the businesses that did not survive the pandemic were struggling before COVID hit. For others, the pandemic provided the opportunity for owners to change professions or retire.

“We had a huge movement of stores that was similar to musical chairs,” she said. “When a business would close and make their space available, multiple people were trying to sign up for it.”

 

Filling the Gaps

Like musical chairs, there are no empty spaces now in downtown Great Barrington. As a lifelong resident, Andrus said she’s never seen so much activity.

“In some ways, this big shift is the best thing that could have happened,” she noted. “The stores have all settled in to the right locations for what they are selling, and it has really changed the atmosphere in town.”

With retail storefronts full, the second- and third-story office spaces are also reaching full occupancy. Pruhenski hopes the current boom can address a long-term concern in town.

“We’ve always anticipated that Great Barrington would see a population decline over the next decade and beyond,” he said. “It would be great to see the influx of new residents flatten or even reverse that decline.”

While many town halls closed during the pandemic and conducted business remotely, Pruhenski said Great Barrington Town Hall closed only twice, for a month each time. Otherwise, he and his staff came in every day to keep several town projects moving forward.

In 2019, the state Department of Transportation had closed the Division Street bridge. Right now, the project is in the permitting and design phase for a new bridge, which is scheduled to open next summer.

“Everyone was forced to jump out of their comfort zone, and I believe that made us all better for it.”

“Division Street is an important bridge because it links the east side of town to the west,” Pruhenski said. “It’s a shortcut everyone in town likes to use.”

In the northern part of Great Barrington, a private water company serves the village of Housatonic that has been struggling with insufficient water pressure. While Great Barrington doesn’t regulate or own the system, the town is involved to make sure residents there receive clean water and to make sure there is plenty of pressure for firefighters when they need it. Pruhenski said he and the Select Board are looking at several options, including a merger with the town’s water system.

“We were working on this during the pandemic because it has an impact on so many residents,” he noted.

After a transportation service for seniors abruptly closed, town officials took the lead to quickly revive the regional van service that now provides transportation to elderly and disabled residents in Great Barrington and five neighboring towns.

Meanwhile, in the spring of 2020, the town launched a project to paint the downtown crosswalks as a way to recognize diversity in town. Pruhenski said the reaction by residents was more encouraging than he could have expected.

“We just did our little project, and the timing happened to be perfect that the rainbow was being used as a symbol of hope at the height of the pandemic,” he recalled. “After we painted our first crosswalks, people were encouraged to come outside to see them and take pictures with them. It’s been a fun project that’s made everyone happy.”

For 2021, the town added more rainbow crosswalks, and now the entire downtown corridor has replaced its white crosswalks with rainbows.

“People from other communities are calling us because they want rainbow crosswalks in their town,” Pruhenski said. “They are asking us how we did it and where we bought the paint. This project has been so rewarding during such a challenging time.”

For several years, Great Barrington has been pursuing projects to encourage environmental sustainability. One big step was to ban plastic water bottles in town. In return, the town has built three public water stations to make up for the bottle ban.

Another sustainability effort involves the Housatonic Community Center, a popular gym built shortly after World War II. Pruhenski said the center is used a great deal in the winter, so the town has bulked up on insulation and added LED lighting. He hopes to see big savings in energy use and operating costs for the facility.

Great Barrington also has the distinction of hosting the first retail cannabis store in Berkshire County. Theory Wellness opened January 2019 and is now one of four cannabis establishments in town. Pruhenski said sales at all four stores have been strong, and they have returned some welcome revenue to the town.

Great Barrington at a glance

Year Incorporated: 1761
Population: 7,104
Area: 45.8 square miles
County: Berkshire
Residential Tax Rate: $15.99
Commercial Tax Rate: $15.99
Median Household Income: $95,490
Median Family Income: $103,135
Type of Government: Open Town Meeting
Largest Employers: Fairview Hospital; Iredale Mineral Cosmetics; Kutscher’s Sports Academy; Prairie Whale
* Latest information available

“For fiscal year 2022, we were able to use $3.5 million in cannabis revenue to offset taxes,” he noted. “Capital budget items, like new police cruisers that we normally have to borrow for, were paid for in cash thanks to the cannabis revenues.”

The town also collects 3% from cannabis stores to mitigate the negative effects of cannabis on the community. After awarding $185,000 in fiscal 2021, Pruhenski said the town will be awarding $350,000 in fiscal 2022 to five social agencies in the form of community-impact grants.

Andrus agreed that cannabis has had an overall positive impact on Great Barrington.

“Despite all the traffic cannabis brings to town, I’m surprised at how unintrusive it has been,” she said. “For people with health issues, cannabis allows them to live with much less pain.”

 

Hit the Road

When Massachusetts launched the Shared Streets and Spaces Grant Program in June 2020, it was immediately popular across the state. Pruhenski called the program a “silver lining” resulting from the dark cloud of COVID. Great Barrington used its Shared Streets grant to develop an outdoor dining area on Railroad Street to support several restaurants located there. Every Friday and Saturday night in the summer, two-thirds of the street is dedicated to outdoor dining. Pruhenski enjoys seeing Railroad Street turn into a café each weekend.

“When we started this in 2020, vaccines were not yet available, and the only way to dine out was to eat outside,” he said. “Restaurants nearby also use their outdoor space, so it creates a lively downtown experience.”

Andrus said outdoor dining on Railroad Street was a huge effort that was well worth it. “It works great, and people love it. The restaurants want to see this keep going, so they are all taking part.” The town also participates in an effort called Berkshire Busk, in which a dozen entertainers perform at different spots around downtown Great Barrington during the outdoor dining season.

Andrus said the town’s response the to pandemic reminds her of the expression, “don’t waste a good crisis.”

“Everyone was forced to jump out of their comfort zone, and I believe that made us all better for it,” she added. “Because we were all kind of stagnant before the pandemic, it made us try something different.”

Pruhenski would be the first to say that Great Barrington is moving in a positive direction as more people move in, and many are locating their businesses here, too.

“School enrollments are increasing, and Main Street is busier than it’s ever been,” he said. “It’s a really exciting time for the town.”

Accounting and Tax Planning

Where There’s Smoke…

By Kristina Drzal Houghton, CPA, MST

 

Kristina Drzal Houghton

Kristina Drzal Houghton

The production and distribution of cannabis, once known to many only as marijuana, is the newest and most variegated industry in America. Some would even say it is one of the toughest industries in America in which to do business. This article will discuss a few unique challenges from a financial perspective faced by the industry.

The first complexity starts with the difference between cannabis and CBD. When you look at a cannabis plant and a hemp plant side by side, the plants themselves look identical to an untrained eye, making it a bit challenging to identify, as the real difference lies in the chemistry of the plants.

CBD can be extracted from hemp or marijuana. Hemp plants are cannabis plants that contain less than 0.3% THC (the compound that creates the ‘high’ sensation), while marijuana plants are cannabis plants that contain higher concentrations of THC. This article will refer to all products containing more than 0.3% THC as cannabis, while products with less will be referred to as CBD.

So, basically, the only difference from a scientific standpoint is the level of one chemical. However, things are much more complex from a legal and tax perspective. Under the 2018 Farm Bill, CBD and hemp are now legal, and not on the schedule I list of controlled narcotics right up there with heroin and LSD. In 2016, Massachusetts passed a law making all cannabis legal, and all but five other states have passed laws making it either fully legalized, decriminalized, or medically authorized. While cannabis is federally illegal, the Internal Revenue Service is perfectly willing to collect taxes on companies that handle the product.

Federal tax law is very punitive on the cannabis industry. Internal Revenue Code Section 280E is a very short part of the tax code (just one sentence) and states:

“No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by federal law or the law of any state in which such trade or business is conducted.”

Under 280E, you’re not allowed any deductions or credits on your return, but you can deduct the cost of goods sold, as that is part of the definition of taxable income. A cannabis farm will only be allowed to allocate various costs, direct and indirect, into cost of goods sold and inventory. Section 280E will affect only cannabis entities. CBD companies, since they are legal, are allowed all normal business deductions and credits available to other non-cannabis companies. This provides many more opportunities to reduce taxable income to a hemp/CBD company.

It is not only the federal tax difference which significantly attributes to the disproportionate cost of cannabis versus CBD. Due to discrepancies between state and federal law, legal cannabis businesses are forced to operate almost entirely in cash, with very little access to financial services, since most banks are federally insured and therefore unable to establish accounts for this federally illegal business. This leaves thousands of dollars stored in backroom safes and transported in shoeboxes and backpacks, creating a prime target for crime. Another banking challenge that cannabis businesses regularly face is exorbitant monthly account fees, or banks that take a percentage of each deposit.

The industry faces many other challenges as well. For example, most states have a mandated ‘seed to sale’ software-tracking system that must be used and accurate (daily), and must be reconciled with POS (point of sale) systems and accounting systems. Additionally, because this is a new industry, many of the tools other industries use are simply not readily available, including a cannabis-tailored chart of accounts, QB POS systems, reliable inventory software, and common merchant service platforms.

There is an opportunity for dispensaries to separate some revenue streams outside of the cannabis division, meaning normal business deductions are allowed for the non-cannabis division. These might include clothing, paraphernalia, coffee, CBD, and other goods. While this is good news for the industry, it only creates even more complexities when allocating selling and administrative expenses.

A recent report from the U.S. Treasury inspector general for Tax Administration recommends increased audits by the IRS of cannabis businesses to identify potential non-filers and returns that are not 280E-compliant. For this as well as the above reasons, cannabis businesses need to find an accounting firm that really knows what it’s doing. The cannabis accountant has to not only understand Section 280E, but also know how to treat a business that deals strictly (and necessarily) in cash. Many cannabis companies have bad books because their bookkeepers do not understand the special accounting and therefore didn’t properly categorize expenses. It can be time-consuming to fix them.

So, while the many layers of regulatory control and reporting may be of utmost importance to those operating in the cannabis industry, overlooking the complexities in the finance area of the business can lead to the proverbial perfect storm — or the business going up in smoke.

 

Kristina Drzal Houghton, CPA, MST is a partner at the Holyoke-based accounting firm Meyers Brothers Kalicka, P.C.

Business of Aging Special Coverage

House Calls

While the pandemic may have challenged the home-care industry, it certainly didn’t suppress the need for such services. In fact, demographic trends in the U.S. — where about 10,000 Baby Boomers reach age 65 every day — speak to continued, and growing, demand for care services delivered in the home. That means opportunities both for agencies who specialize in this field and job seekers looking for a rewarding role and steady work.

Michele Anstett says business was like “falling off a cliff” when COVID hit, but client volume has returned to normal.

Michele Anstett says business was like “falling off a cliff” when COVID hit, but client volume has returned to normal.

By Mark Morris

In early 2020, Michele Anstett, president and owner of Visiting Angels in West Springfield, was pleased because her business was doing well. As a provider of senior home care, she managed 80 caregivers for 50 clients.

“We were going along just fine,” she said. “And when COVID hit, it was like falling off a cliff.”

The business model for companies like Visiting Angels involves interacting with people in their homes, so when early mandates encouraged people to keep away from anyone outside their immediate ‘bubble,’ it hit the industry hard.

Even though caregivers were designated as essential workers, Anstett saw her numbers shrink to 39 caregivers who were now responsible for only 19 clients. In order for her business to survive, she continued to provide services for her clients who needed personal-care services around the clock and for those who had no family members in the area.

“Where possible, we asked family members to step in to help out,” she told BusinessWest. “At the beginning of the pandemic, there was less risk to everyone when a family member could be involved with their loved one’s care.”

Anstett also incorporated a detailed checklist of risk factors for each caregiver to review to prevent COVID-19 from spreading to them or their clients.

“I thought patients weren’t following up because of a language barrier. As it turns out, they weren’t responding because they didn’t understand the severity of the situation.”

“We talked with caregivers about the people in their circle,” Anstett said. “It was similar to contact tracing, but we did it beforehand, so people would understand what they had to consider to protect themselves, their families, and their clients.”

A Better Life Homecare in Springfield runs two home-care programs. In one, it provides personal-care services such as helping seniors with grooming, cooking, laundry, and more. The other program provides low-income patients with medical care in the home, such as skilled nursing services, occupational therapy, and physical therapy.

On the medical side of the business, licensed practical nurses (LPNs) handle many of the home visits, while certified nursing assistants (CNAs) and patient care assistants (PCAs) are the main frontline workers on the personal-care side. A Better Life also employs case workers to supervise PCAs and CNAs and to set up other resources a patient may need, such as Meals on Wheels and support groups.

When COVID hit, said Claudia Lora, community outreach director for A Better Life, she and her staff made patient communication a top priority.

Claudia Lora

Claudia Lora says communication with clients was key to navigating the pandemic.

“We implemented daily phone calls to our patients that also served as wellness check-ins,” she recalled. Because a majority of the company’s clients are Spanish speakers, A Better Life employs many bilingual staff. At the beginning of their outreach efforts, Lora became concerned when some patients didn’t seem to follow up and respond to communications.

“I thought patients weren’t following up because of a language barrier,” she said. “As it turns out, they weren’t responding because they didn’t understand the severity of the situation.”

On the other hand, she said some patients temporarily stopped their home-care service out of concern about interacting with anyone in person. The system of daily phone calls helped address patient concerns and keep them current on their treatments. In addition, patients received whimsical postcards to lift their spirits and care packages of hygiene products and food staples.

“The pandemic opened our eyes in different ways,” Lora said. “It made us aware that we needed a system of daily phone calls in both programs, which we will continue even after the pandemic is no longer a concern.”

 

Growing Need

The lessons home-care agencies learned from the pandemic — some of which, as noted, will lead to changes in how care is provided — come at a time when the need for home-based services is only increasing.

That growing need is due in part to people living longer, of course. According to government data, once a couple with average health reaches age 65, there is a 50% chance one of them will live to age 93, and a 25% chance one of them will see age 97. With the increased longevity, there is also a greater chance these seniors will need some type of assistance with daily chores or treating a malady.

Receiving care at home, with an average cost nationally of $3,800 per month, is less expensive than moving into a nursing home (approximately $7,000 per month), and nearly everyone would rather stay in their home. When seniors need assistance, Anstett said, they often rely on family members out of fear of having an outside person come into their home.

Now that concerns about COVID are easing, she reports that people are increasingly more willing to have someone come in to their home to help, but there are still some who resist. “I wish they could understand we are not there to take away their independence, but to give them more independence.”

Lora said some of her patients were reluctant to allow people to come into their homes until they considered the alternatives.

“The only other option for people receiving medical care would have been checking into a skilled-nursing facility or a nursing home,” she noted. “I knew that was the last place they wanted to go.”

She added that the extensive news coverage of high rates of COVID in nursing homes and the high case rate locally at the Holyoke Soldiers Home convinced most people that care at home was a wise choice.

Anstett and Lora both pointed out that their companies always make sure anyone providing home care wears appropriate personal protective equipment and follows the latest guidelines for preventing the spread of COVID. Anstett said she encourages her caregivers to get vaccinated, but doesn’t force the issue because she recognizes some people have health issues.

“However,” she added, “I make it clear to the unvaccinated folks that the pool of clients willing to see a caregiver who is not vaccinated is fairly small.”

While the pandemic may have slowed down business in the short term, demographic trends still remain strong for the years ahead. According to U.S. Census Bureau data, about 10,000 people reach age 65 every day. This trend is expected to continue until 2030, when all living Baby Boomers will be at least 65 years old.

 

Looking Ahead

Fifteen months after the chaotic early days of the pandemic and with many people now vaccinated, Lora said A Better Life is busier today than before the pandemic.

“In the last six months, admissions have increased by around 50%,” she noted. “That’s more than I have seen in the past three years; it’s been insane.”

She added that her company is now short-staffed because of the rapid growth it is seeing and has been offering incentives to try to bring more CNAs and PCAs on board.

Anstett said her client numbers and caregiver numbers are back to where they were before the pandemic and noted that she has not had any problem filling open positions.

“I just cut 80 paychecks, and we are anticipating even more growth,” she said, adding that her secret to hiring is treating caregivers with respect and encouraging them to grow in their careers. “I stay in touch with every one of our caregivers. They’re the reason I’m working, so I treat them with the utmost respect.”

While many professions look to push out older workers, Anstett said she appreciates more seasoned workers and looks forward to hiring them. “Caregiving is an opportunity to keep working for those who want to, and we welcome their experience.”

Pointing out that she hired another case manager last week, Lora added that, while her organization is expanding, it has not forgotten its mission.

“Even with our growth,” she said, “we see our patients as part of a family and a community, not just a number.”

Employment

Get the Vaccine or Get Fired?

By John S. Gannon, Esq. and Meaghan E. Murphy, Esq.

 

To mandate the COVID vaccine, or not to mandate?

John S. Gannon, Esq

John S. Gannon, Esq.

Meaghan E. Murphy, Esq

Meaghan E. Murphy, Esq.

That is the question on the minds of employers across the globe. As employment lawyers, we have been asked that question countless times by clients (and friends). Until about a month ago, all we could do was provide our best guess based on guidance and legal decisions related to other vaccines, like the flu shot. However, on May 28, the U.S. Equal Employment Opportunity Commission (EEOC) provided some comprehensive COVID-19 guidance that addresses this topic head-on.

The EEOC is the federal agency that enforces anti-discrimination laws applicable to workplaces. The news is good for Massachusetts employers considering a mandatory vaccine program. Some of the key takeaways for employers are described below.

 

Mandatory Vaccinations

The EEOC guidance declares in no uncertain terms that an employer can lawfully require employees to obtain a COVID-19 vaccination as a condition of returning to the workplace. Such a practice would not run afoul of the Americans with Disabilities Act (ADA) or the Genetic Information Non-discrimination Act (GINA). There is one big catch: an employer mandating vaccines must reasonably accommodate employees who are unable or unwilling to get vaccinated because of a disability or sincerely held religious belief.

These employees might need to be excepted from the vaccine mandate if other safety measures can keep them and others safe. The EEOC provided examples of such accommodations, including requiring an employee to continue to wear a mask and socially distance while in the workplace, limiting contact with other employees and non-employees, providing a modified shift, permitting continued telework if feasible, conducting periodic COVID testing, or reassigning the employee to a vacant position in a different workplace.

Notably, employers should not assume that an employee does not require an accommodation relating to COVID simply because the employee is fully vaccinated. The guidance provides that an employer may need to accommodate an employee who is fully vaccinated for COVID if there is a continuing concern for heightened risk of severe illness from a COVID infection.

For an employee who is unwilling to obtain the vaccination because of a sincerely held religious belief under Title VII, employers should presume that the request is legitimate. The EEOC does make clear, however, that if an employee requests a religious accommodation, and an employer is aware of facts that provide an objective basis for questioning either the religious nature or the sincerity of a particular belief, practice, or observance, the employer would be justified in requesting additional supporting information.

Employers presented with this issue should proceed with caution, as the EEOC will take a narrow view of such circumstances. Employers are required to engage in a similar ‘interactive process’ with employees who have sincere religious objections to vaccination and provide an accommodation that allows the employee to return to work where doing so does not present an undue hardship.

 

Vaccination Incentives

An employer may lawfully provide an incentive to its employees to obtain COVID-19 vaccination outside the workplace so long as the incentive is not so substantial as to be coercive. Unfortunately, the EEOC did not give any examples of what incentives would be considered ‘so substantial as to be coercive’ and also failed to clarify whether and to what extent an employer must provide a vaccine incentive to employees who are unable to obtain a vaccination due to a medical or religious-based reason.

 

Confidentiality

An employer’s request for self-disclosure of vaccination status, or for documentation or other confirmation that an employee has received a vaccination from a third party (such as a pharmacy or personal physician), is not a medical examination or a disability-related inquiry. As a result, employers may lawfully request this information without implicating the ADA or GINA.

With that said, employers should restrict access to vaccine-related information, apply safeguards similar to those applied to other types of sensitive personal information, and obtain appropriate consent from employees before disclosing vaccine-related information to third parties.

 

Legal Actions

To date, there has been one reported case dealing with mandatory vaccines in the workplace. Similar to the EEOC guidance, the case supports an employer’s right to mandate COVID vaccines.

In April, the Houston Methodist Hospital System in Texas issued a directive requiring that all employees be fully vaccinated by June 7 or they would be placed on a two-week suspension. Employees who were not vaccinated by the end of the suspension period would be terminated.

In late May 2021, more than 100 employees who were not vaccinated, and apparently did not qualify for a disability or religious exemption, filed a lawsuit against the hospital raising a number of claims, including wrongful termination. The judge dismissed the lawsuit entirely. In his written decision, the judge expressed his dismay with the plaintiffs for equating the threat of termination for refusing to get the COVID vaccination to the forced medical experimentation in concentration camps during the Holocaust, calling the comparison “reprehensible.”

Addressing an argument that the vaccine mandate was contrary to public policy, the judge wrote that the vaccine requirement “is consistent with public policy. The Supreme Court has held that (a) involuntary quarantine for contagious diseases and (b) state-imposed requirements of mandatory vaccination do not violate due process.”

 

Bottom Line

While this EEOC guidance and recent decision may seem like a big victory for mandatory COVID vaccines in the workplace, Massachusetts employers should be cautious in relying on them too heavily. The Commonwealth has its own anti-discrimination and public-policy laws, so it’s difficult to predict how this might play out in a state court or administrative proceeding.

In other words, while the decision is encouraging for Massachusetts employers who want to require vaccines, it is important to check in with experienced labor and employment counsel before implementing a mandatory vaccine program.

 

John Gannon and Meaghan Murphy are attorneys at the firm Skoler, Abbott & Presser, P.C., in Springfield; (413) 737-4753; [email protected]; [email protected]

Employment

Breaking Down the Trickier Aspects of Massachusetts Laws

By Ludwell Chase and Amy B. Royal, Esq.

State and federal laws pertaining to minimum wage, tips, overtime, and employing minors are complicated. As a result, these are areas where mistakes are often made.

Ludwell Chase

Ludwell Chase

Amy B. Royal, Esq

Amy B. Royal, Esq

Employers, however, cannot afford these errors because the consequences of not complying with these laws can be very costly. In fact, in Massachusetts, there are mandatory treble (triple) damages for violations of wage-and-hour laws relating to minimum wage, tips, and overtime. This means that, if an employer is found in violation of state law, at a minimum, for every dollar an employer does not pay in accordance with wage-and-hour laws, that employer will have to pay three times that amount.

Under Massachusetts and federal law, employers are allowed to pay employees who receive tips an hourly wage that is lower than the minimum wage. This works by allowing employers to take a ‘tip credit’ for a certain amount in tips that the employee earns. The employee must not make less than minimum wage when their tips and hourly wage are combined. Under the federal law, the Federal Labor Standards Act, all hourly workers must be paid the federal minimum wage of $7.25. Tipped workers may be directly paid $2.13 per hour if their tips and hourly wage combined are at least equal to the minimum wage. In other words, employers can claim a ‘tip credit’ of $5.12 per hour.

The U.S. Department of Labor (DOL) recently released new proposed regulations for tipped workers that reinstate the 80/20 rule. This rule limits the amount of time tipped workers can spend performing activities that are related to tip-generating duties, while their employers can still claim the tip credit. Tipped workers must spend at least 80% of their time performing directly tip-generating activities, such as serving customers, and no more than 20% of their time performing not directly tip-generating activities, such as setting tables. This rule was previously in effect but was replaced by DOL guidance in 2018.

The 2018 guidance provided that employers could claim the tip credit if non-tipped duties were performed at the same time as tipped duties, or if the non-tipped duties were performed for a reasonable time before or after tipped duties. This new proposal returns to the 80/20 rule. In addition, the new proposal specifies that, if an employee performs non-tipped activities for 30 minutes in a row, the employer cannot pay the employee the lower tipped hourly wage for that time.

For employers with tipped workers that are subject to federal wage-and-hour law, this proposal is a good reminder that they need to pay attention to these potential changes and their effects on how they compensate employees.

 

Caution on the Menu

Massachusetts has its own complex laws relating to tips, minimum wage, and overtime. As a result, these are areas where it is easy for employers to make mistakes. Therefore, employers need to pay special attention to ensure they are complying with both state and federal laws. As of Jan. 1, 2021, the minimum wage in Massachusetts is $13.50 per hour. Massachusetts is incrementally increasing the minimum wage in order to reach a $15 minimum wage by 2023. For now, employers may pay workers who make at least $20 a month in tips a tipped hourly wage of $5.55 and take a tip credit of up to $7.95 per hour, for a combined minimum wage of $13.50.

The Massachusetts Tip Law mandates that all tips must be given to employees whose work directly generates tips, and that employers and managers may not keep any portion of their employees’ tips. The law applies to three categories of employees: waitstaff employees, service bartenders, and service employees. Waitstaff employees include waiters, waitresses, busboys, and counter staff who serve beverages or food directly to patrons or clear tables, and do not have any managerial responsibilities. Service bartenders prepare beverages to be served by another employee. Service employees include any other staff providing service directly to customers who customarily receive tips but have no managerial responsibilities. For the purposes of this law, managerial responsibilities are duties such as making or influencing employment decisions, scheduling shifts or work hours of employees, and supervising employees.

Massachusetts law allows for ‘tip-pooling’ arrangements. This means all or a portion of tips earned by waitstaff employees are pooled together and then distributed among those employees. Employers must be cautious when administering a tip pool and ensure that only waitstaff, service bartenders, and service employees are being paid from the pool. This means managers and back-of-house employees like cooks and dishwashers cannot share in tips. Even employees with limited managerial roles who also directly serve patrons are not considered waitstaff employees on days when they perform managerial duties.

When employees do not receive enough in tips to make up the difference between the tipped hourly wage and the minimum wage, employers must pay the difference. Employers are required to calculate tipped employees’ wages at the end of each shift, rather than at the end of the pay period. This requires employers to keep track of how much workers receive in tips for each shift. This may also require employers to pay their tipped employees additional amounts in order to compensate for slow shifts.

Under Massachusetts law, certain businesses, including restaurants, are exempt from paying employees overtime; however, they may not be exempt under federal law. If subject to federal law, employees working in restaurants must be paid one and one-half times the minimum wage (not one and one-half times $5.55 per hour) for all hours worked in excess of 40 hours per week.

Under the Massachusetts Tip Law, if a restaurant includes a service charge, which serves as the functional equivalent of an automatic tip or gratuity, all the proceeds from that service charge must be paid only to waitstaff employees, service employees, or bartenders as a tip. Employers may, however, charge a ‘house fee’ or an ‘administrative fee,’ which they may use or distribute at their discretion, but only if it is clearly stated to customers that the fee is not a tip, gratuity, or service charge for tipped employees. Thus, any fees not intended as gratuities and not paid solely to tipped employees should not be labeled as a service charge.

 

Food for Thought

These complexities are especially important to Massachusetts employers, given that the consequences of failing to comply with wage-and-hour laws can be costly, and the penalty is the same regardless of whether the employer violated the law willfully or by mistake.

Considering the consequences of violations, businesses with tipped employees should regularly consult with their employment counsel to review their practices and policies to ensure compliance with state and federal law.

 

Ludwell Chase and Amy B. Royal work at the Royal Law Firm LLP, a woman-owned, boutique, corporate law firm; (413) 586-2288; [email protected]

Special Coverage Sports & Leisure

Play Time

Sarah Blais says it’s good to hear activity again at Spare Time Bowling.

Sarah Blais says it’s good to hear activity again at Spare Time Bowling.

Among the industries battered by the pandemic and the ensuing economic shutdown, indoor recreation centers — from bowling alleys to trampoline rooms to roller rinks — took a massive hit last year, forced to close for longer than most other businesses and then tasked with navigating a very gradual ramp-up to normal operations. Now, a month after the final restrictions were lifted, the owners and managers of these businesses are grateful to be fully open, with a renewed understanding of the value of play in people’s lives.

By Mark Morris

After a successful 2019, Jeff Bujak looked forward to 2020 as a chance to further grow Prodigy Mini Golf and Game Room in Easthampton. Then the pandemic hit.

“In the beginning, we were told to shut down for 15 days, and I said, ‘OK, let’s do it,’” Bujak recalled. When two weeks stretched to four months, however, he became worried about his business surviving.

He wasn’t alone. Every business that offers indoor entertainment was affected by the lengthier-than-expected, state-mandated shutdown to control the spread of coronavirus. Rob Doty, managing partner at Bounce! Trampoline Sports in Springfield, said his doors remained closed just two weeks short of a full year.

“At that time, there was huge fear about going near anyone and staying away from enclosed environments. I was concerned that people might stay afraid forever and not come back.”

“We had just installed a laser-tag arena,” Doty said. “We were getting it up and running for the season when we had to shut down.”

Like Bounce!, Interskate 91 North closed the roller-skating rink at Hampshire Mall in March 2020 but was allowed to reopen in October. Management held off opening until after Thanksgiving, but then had to shut down again when COVID-19 infection rates began to climb.

“To follow the guidelines, we stayed closed for a few more months and opened again in late March,” said Sarah O’Brien, sessions manager.

Meanwhile, Sarah Blais, general manager of Spare Time Bowling in Northampton, said her facility remained closed until late July 2020, and then, by mandate, could only operate at 25% capacity.

Jeff Bujack

Jeff Bujack is happy that customers can once again access his collection of vintage video games at Prodigy.

“We spaced everyone out by using every other lane,” she said. “It was slow in the beginning, and we didn’t even hit our 25% capacity numbers.”

Once the calendar turned to 2021, Blais said business began to pick up, and Spare Time began to reach its limited capacity. As more employees returned, she held an orientation for them on how to operate during a pandemic that’s not yet over.

“In short, it involved much more work than usual, and my team was all in for it,” she said. Much of the extra work concerned lots of sanitizing, including every bowling ball in the place.”

While extra cleaning was part of the mandate to reopen, all the managers BusinessWest spoke with agreed that the emphasis on cleaning went a long way toward helping customers feel safe.

“For the most part, we were doing our normal cleaning, but we did it more often,” O’Brien said. “People loved seeing us constantly cleaning.”

Doty concurred. “Now that hyper-cleaning has become second nature, I don’t see us changing things,” he said, adding that his crews use a fogger/mister to clean the trampoline courts as well as additional handheld sprayers to clean other areas.

“It was awesome when we reopened because my bosses and co-workers are like a second family to me.”

It’s yet another step in emerging from what has been a challenging 16 months, to say the least. But with the state lifting all pandemic restrictions on gathering sizes and mask wearing at the end of May, this is also an optimistic time for these facilities that are eagerly welcoming back families grateful for something to do.

 

Leveling Down

Prodigy doesn’t easily fit into a business category because it offers its customers the chance to play mini-golf, vintage video games, and even board games. Located in the Eastworks mill complex, Prodigy occupies 8,000 square feet, with 14-foot high ceilings, industrial fans, and windows that open to the outside.

While disappointed that his business was considered an arcade by state standards, Bujak was able to open last summer because indoor mini-golf courses were allowed to operate. He could not offer play on the video games, however, due to limits on arcades.

Rob Doty is expecting a big rebound at Bounce! Trampoline Sports.

Rob Doty is expecting a big rebound at Bounce! Trampoline Sports.

While nearly breaking even during the during the warm months, by November, the losses began to pile up, and Bujak was desperate.

“At that time, there was huge fear about going near anyone and staying away from enclosed environments,” he recalled. “I was concerned that people might stay afraid forever and not come back.”

With plenty of spacing and cleaning protocols in place, he reached out to his social-media followers to at least try the new layout and give their feedback. He said his spacious location eased concerns about social distancing and air flow.

“There was a community of people who said, ‘you can’t close, I need this place. The pandemic proved that it’s not just about me, it’s about hundreds of people who use Prodigy as a place to get away and play the games they can’t play anywhere else.”

“Gradually, friends, family, and our regular customers came in,” Bujak said. By January, business had returned, and February was the most successful month in Prodigy’s history.

“I don’t know if all these efforts with masks, distancing, and cleaning actually made people more safe,” he said. “It was more important that people felt safe in the environment and felt good about their choice to come in.”

As to why February was a banner month for Prodigy, Bujak said people had begun to figure out they could go out as long as they wore masks and distanced. People were also becoming more hopeful as access to vaccines received news coverage. “Most people were not ready for a concert or bar atmosphere, so this was a good middle ground of being social but still low-key.”

The disco lights are on again at Interskate 91, and Sarah O’Brien is expecting the crowds to return.

The disco lights are on again at Interskate 91, and Sarah O’Brien is expecting the crowds to return.

Blais credits a simpler rationale. “I think everybody just met their quota of staying at home,” she said with a laugh.

For the better part of a year during which Interskate 91 opened and closed a couple times, O’Brien found herself sidelined, without work, for the first time since she was 14 years old.

“I was home for nearly a year, and I missed not being here,” she said. “It was awesome when we reopened because my bosses and co-workers are like a second family to me.”

At the height of the pandemic when nearly everyone was advised to stay home, many used their time to clean out garages and basements to get rid of things that were no longer useful. Bujak benefited greatly from the COVID cleanout as many people donated old video-game consoles, video games, and board games to him.

“I might have doubled my amount of games just from people cleaning out their basements,” he said.

While most managers said they used the closed time to deep-clean their locations, O’Brien said Interskate 91 installed a new carpet and created a dedicated area where food is sold and eaten. “In the past, we let people eat anywhere. By keeping it all in one area, we can offer more food choices than we did before.”

As of May 29, people who had been vaccinated no longer had to wear masks in retail settings, and bounce houses, roller rinks, bowling alleys, and similar businesses could once again operate at full capacity.

“On the first weekend where people didn’t have to wear masks, we had lots of families and kids come in,” O’Brien recalled. “ Our regulars were so excited that we were open again.”

Blais admits seeing the return of people bowling was an emotional experience. “It’s very nice to hear bowling balls hitting the pins again.”

Doty is looking forward to finally getting use out of the laser-tag room. “Now that we’re fully open, we’re getting the word out about our laser tag and our expanded arcade,” he said, adding that he’s also looking forward to booking birthday parties and other group events.

To recognize the challenging 16 months everyone has gone through, Spare Time has begun offering weekly Service Industry Nights to workers in the restaurant industry.

“I’ve been talking with the restaurants in town, and we offer them free bowling from 9 to 11 p.m., and they have the place to themselves,” Blais said. “We are extending our service nights to our police and fire departments as well.”

 

Replay Value

Bujak said the experience of the past 15 months has made him a different person. At the start of the pandemic, he saw himself as an individual business owner who worried about losing his dream. He didn’t realize that Prodigy was bigger than just him.

“There was a community of people who said, ‘you can’t close, I need this place,’” he told BusinessWest. “The pandemic proved that it’s not just about me, it’s about hundreds of people who use Prodigy as a place to get away and play the games they can’t play anywhere else.”

Now that he can operate at full capacity, Bujak is grateful his business has survived and he can once again take care of his regular customers and introduce Prodigy to new ones.

“Here we are,” he said, “back to normal-ish.”

Community Spotlight

Community Spotlight

By Mark Morris

Mayor Nicole LaChapelle

Mayor Nicole LaChapelle says she is concerned about the deeper effects of COVID, and is thus stressing the importance of public health.

 

While grateful that Easthampton is reaching the other side of COVID-19, Mayor Nicole LaChapelle understands there is still plenty of work ahead.

Even though her city came through the pandemic in better shape than many communities, she has prioritized building up the Public Health department to help the city move forward.

“We’re looking at public health as a part of public safety,” LaChapelle said. To that end, the mayor hopes to add more clinical staff to the department as well as encourage other city departments to collaborate with Public Health.

“I’m concerned about the deeper effects of COVID, from people who had COVID and survived to the mental-health aspects of it on so many people,” she went on. “In Easthampton, we need to support those with medical needs as well as mental-health needs.”

There may be some help on the way. Recently, the Center for Human Development (CHD) purchased the former Manchester Hardware store on Union Street. While CHD currently has a small presence in Easthampton, moving to the nearly 18,000-square-foot building will allow it to expand its services.

Right now, plans include outpatient mental-health counseling services for all ages and primary medical care at the site. LaChapelle said CHD could go a long way to filling the gaps in behavioral-health services in the city.

“CHD has been a good partner, and they are listening to the needs of our community members,” she said. “I feel good about what they will bring to Easthampton.”

After 125 years in business, Manchester Hardware closed its doors late last year. Owner Carol Perman had tried to sell the business to a regional hardware chain, but when that and several other possible suitors didn’t pan out, she decided to retire and just sell the building.

Some in Easthampton were critical of LaChapelle for not trying harder to locate a for-profit business at the Manchester property. Yet, “Easthampton has historically had community-based services downtown. This is not a new placement of services,” she said, noting that Manchester Hardware’s location on a public bus route helps it fit in with City Hall, the Council on Aging, and Veterans’ Services, which are all located downtown.

“As businesses reopen and start to come back, we as a city want to help them readjust to be successful for the long term.”

While there have been calls to model Northampton by pursuing a robust Main Street business district, LaChapelle said she would be negligent as mayor to try to imitate other communities and ignore her own city’s strengths. “Having centrally located services for our residents is a real strength of Easthampton, and we need to pursue those things we do well.”

The mayor’s emphasis on public health is about bringing the entire community back, she noted, especially businesses in Easthampton. “As businesses reopen and start to come back, we as a city want to help them readjust to be successful for the long term.”

 

Back on Track

Since the beginning of the pandemic, the Greater Easthampton Chamber of Commerce has also worked closely with businesses to get them back on track.

“Even as COVID nears its end, business owners are trying to get their sea legs back,” said Moe Belliveau, the chamber’s executive director.

For the past 15 months, the chamber has shifted its role to become a central information resource in helping local businesses identify and apply for financial assistance during COVID.

“We sifted through all the extraneous information that comes with forms that apply to many situations,” Belliveau said. “Our members knew they could rely on us to get the right information and avoid the firehose effect of too many forms.”

In addition to securing federal grants, the chamber partnered with the city on a state economic-development project that enabled 31 businesses in Easthampton to each receive $1,500 grants.

Belliveau is currently working with the city planner on a COVID-recovery strategic plan. “There are still unknowns as we come out of COVID, so we’re trying to keep communication pathways open so we can make adjustments when necessary,” she said. “The chamber’s mission in this becomes to remain agile so we can provide help where needed and respond to opportunities when we see them.”

Like many communities, Easthampton businesses are having trouble filling open jobs. LaChapelle hopes to address this by possibly using state and federal money to subsidize local businesses so they can pay higher wages to get people back to work.

River Valley Co-op, a full-service supermarket

The opening of the River Valley Co-op, a full-service supermarket, is one of many intriguing developments in Easthampton.

The opening of the River Valley Co-op, a full-service supermarket with an emphasis on local and organically grown foods, is bringing lots of excitement to Easthampton. With its grand opening in July, River Valley will offer a 22,000-square-foot market to Easthampton employing 83 unionized workers with hopes of growing that number. By installing solar canopies in the parking lot and solar collectors on the roof, it produces enough power to offset the energy required to run the market, making it a net-zero building.

LaChapelle said River Valley is already inspiring the city to pursue its own energy-saving projects. “We’ll be putting solar canopies in the parking lot and on the roof of City Hall, as well as behind the Public Safety department. It won’t bring us to net zero, but it’s a good start.”

Easthampton at a glance

Year Incorporated: 1785
Population: 16,059
Area: 13.6 square miles
County: Hampshire
Residential Tax Rate: $17.46
Commercial Tax Rate: $17.46
Median Household Income: $45,185
Median Family Income: $54,312
Type of Government: Mayor, City Council
Largest Employers: Berry Plastics Corp., INSA, Williston Northampton School, National Nonwovens Co.
* Latest information available

Mountain View School, which will serve students from pre-kindergarten through grade 8, is nearing completion and expects to welcome middle-schoolers in January 2022, after the holiday break. LaChapelle said the plan is to move some of the younger grades into the new school next spring, and by fall 2022, all grades will be attending Mountain View.

“A couple years ago, we discussed the fear of moving young children during the school year and how disorienting that might be,” the mayor noted. “Since COVID and all the adjustments students have had to make, we no longer see that as an issue.”

Once all the students move to the new school, Easthampton will try to sell the Maple, Center, and Pepin school buildings, all of which are more than 100 years old. LaChapelle hopes to see those buildings developed into affordable housing, and the city is marketing all three schools as one project to make it more attractive to developers.

“There are still unknowns as we come out of COVID, so we’re trying to keep communication pathways open so we can make adjustments when necessary.”

“If we converted just one of these schools for affordable housing, it would be tough because it may result in only 12 units,” LaChapelle said, adding that several developers are considering the three schools as one package, and she remains optimistic that a deal might soon be in the works.

At one time, Easthampton was known for its mills. Long after they were shut down and no longer viable, the mill buildings are now a way to address economic development and to make more housing available. One Ferry Street is a project that is renovating old mill buildings into mixed-use properties featuring condominium and rental housing, as well as office space. One building, 3 Ferry, is already open, and several businesses are currently leasing space there. The next two buildings slated for renovation sit behind it and present a sort of before-and-after contrast to illustrate the potential at the site. Once complete, those two buildings, both much larger than 3 Ferry, will add more than 100 new housing units to Easthampton.

While many businesses either slowed down or shut down during the pandemic, the four cannabis dispensaries located in Easthampton continued to generate income for the city. LaChapelle is hoping to use some of that revenue for a clean-buildings initiative. With several buildings in need of new HVAC systems and some state money available, she sees this as an opportunity to invest in public infrastructure that will benefit the city well into the future.

“It’s a big step, and, where appropriate, we could offset some of the one-time expenses with our cannabis revenues,” she added.

 

Change Agents

Belliveau said one of the strengths of Easthampton is an eclectic entrepreneurial base. Last year, the National League of Cities selected Easthampton as part of its City Innovation Ecosystem program designed to drive entrepreneurship and innovation. The city’s effort, titled Blueprint Easthampton, currently features an online resource navigator to connect entrepreneurs with everyone from suppliers to counselors to help advance their enterprises.

The Massachusetts LGBT Chamber of Commerce and the Assoc. of Black Business & Professionals are also working with Blueprint Easthampton, which puts a focus on informal entrepreneurs who might not qualify for traditional grants, LaChapelle said, adding that she’s most excited about the coaching aspect of the program.

“[JPMorgan Chase CEO] Jamie Dimon has executive coaches — why not someone who’s making a product for sale on Etsy?” she said. Through coaching, entrepreneurs can learn how to take advantage of the many resources that are available.

“We’re seeing all kinds of people, including single parents and people of color, who are all trying to figure out how to grow,” the mayor said. “We’re giving them technical support, executive coaching, and, at the end of the program, a gift of capital to help them get ready for the next step in their venture. We just ask they register as a business in Easthampton.”

Through all its challenges, LaChapelle remains optimistic about Easthampton because she feels there is a real dialogue between the city and its residents.

“In Easthampton, you can get involved in your government and make a difference,” she said, crediting, as an example, efforts by volunteer groups who worked with the city to create open public spaces.

“Easthampton has really embraced change and the ability to evolve and grow,” Belliveau added. “In general, I’ve found people are excited about the positivity and potential that comes with change, even when it’s scary.”

Banking and Financial Services

Brokerage App Is a Dangerous Culmination of Intersecting Trends

By Jeff Liguori

 

It was supposed to democratize Wall Street — yet another DIY trend, this time with your hard-earned money.

Robinhood is a popular brokerage application that allows subscribers to open an account with as little as $1, charges nothing for commissions, and allows users to buy fractional shares of stock. Backed by venture capital and slated to go public with an estimated $30 billion valuation, the company has enjoyed meteoric growth with an estimated 13 million users, 50% of whom use the mobile app daily, often multiple times, and 90% of whom use it on a weekly basis. The overwhelming majority of its user base belongs to the millennial demographic.

Robinhood achieved what it set out to do, but at what cost?

I’ve worked in the investment field since 1994 and have managed assets for clients since 2006. I’m also an entrepreneur, so I appreciate disruptive technology amid a changing business landscape. Robinhood, however, is the dangerous culmination of intersecting trends that have harmed investors and, according to financial regulators, may have contributed to a death by suicide.

Jeff Liquori

Jeff Liguori

“Robinhood is not the Home Depot of investing. Do-it-yourself portfolio management has been around since the advent of E-Trade in the mid-’90s. That company disrupted the brokerage industry and forced commissions at most every other firm lower in order to compete for customers.”

The basic business model for financial advisory or money management is that the client pays a percentage of his or her account balance as an annual fee, generally around 1%. To be clear, Robinhood is a brokerage; the firm does not use discretion to manage a client account or offer advisory services. Many brokerage firms have morphed into advisors and now focus more on money management as trading commissions have trended to zero. Overall, this trend has been a positive for individual investors and has improved access to many financial solutions — mutual funds, exchange-traded funds, or individual stocks — as well as financial research and news.

Robinhood is not the Home Depot of investing. Do-it-yourself portfolio management has been around since the advent of E-Trade in the mid-’90s. That company disrupted the brokerage industry and forced commissions at most every other firm lower in order to compete for customers. Just as E-Trade blazed a path for lower commissions, Schwab, Fidelity, and TD Ameritrade slashed commissions to zero in 2019 in response to Robinhood taking market share.

But growth has consequences. Robinhood was at the center of some incredibly volatile trading in a handful of individual stocks. You may have heard of GameStop (GME). The Robinhooders gathered virtually in chat rooms, most notably on a platform called Reddit, and decided as a community which stock they wanted to manipulate. It was no small feat. From Jan. 18 to Jan. 28 of this year, the price of GME went from about $18 to a high of $478, an increase of more than 2,600%. The Robinhood crowd is believed to be the main catalyst for this action. The day GME hit $478, it also went down to $112 before finally closing around $193.

In the month of January, 1.26 billion shares of stock changed hands in GME, almost 15 times the average monthly volume. Robinhood eventually cut off any trading in GME shares on Jan. 28, as well as trading in several other stocks with a similar backstory. Imagine being a small investor, buying GME shares at, say, $250 on Jan. 27, watching your investment nearly double the next day, but not being able to trade and exit your position profitably.

As previously stated, the Robinhood story is the intersection of several trends: fiercely independent millennials, ‘killer app’ technology, and the rewards reaped from the instantaneous decision making of like-minded people, all backed by institutions awash in venture capital, looking for the next big idea. I cringe at the thought that Robinhood may compete with what firms like mine provide for clients, namely deep expertise, sound financial advice, and disciplined investing backed by serious research.

FINRA, a regulatory agency that oversees brokerage firms, recently fined Robinhood $57 million and ordered $13 million in restitution to customers. It is the largest fine ever imposed by that regulator. In the press release, FINRA even referenced the suicide of a 20-year-old trader who panicked when his Robinhood app may have incorrectly displayed a massive $730,000 loss and received only a generic autoreply when he e-mailed Robinhood customer service three times seeking help.

Robinhood the idea is a good one. Robinhood the company has a lot more growing pains on the horizon, which likely won’t prevent the founders from becoming fabulously rich. And I have no problem with wealthy entrepreneurs, who typically risk everything for a single idea. Time and again, however, the investment profession is plagued with these stories in which investors are persuaded to pursue the next big thing. I think FINRA’s message is a powerful one. Now, if someone would just listen.

 

Jeff Liguori is the co-founder and chief Investment officer of Napatree Capital, an investment boutique with offices in Longmeadow as well as Providence and Westerly, R.I.; (401) 437-4730.

 

Insurance Special Coverage

Give and Take

With five generations in today’s workforce, employee benefits are no one-size-fits-all proposition — yet, they remain a key issue for employers looking to attract and retain a skilled workforce. Striking a balance between what employees want and what the business can afford is certainly a challenge — but the flexibility and options available to employers these days makes the task a little easier to navigate.

By Mark Morris

Between demographic changes in the workforce and the impact of the pandemic, employers face multiple challenges these days in offering health insurance and other benefits to their workers.

In the U.S., 49% of people receive health-insurance coverage through their employer. According to the Kaiser Family Foundation, that percentage represents approximately 156 million Americans. Many of those workers also receive coverage for dental care and disability, as well as access to a retirement plan as part of a complete benefits package.

And, despite the increasing costs of health insurance, employers are not cutting back on this essential coverage, said Peter Miller, partner with Millbrook Benefits and Insurance Services in Springfield.

“They are trying to strike a balance between offering a benefits package that is attractive to new hires, while also trying to control costs and keep the business running,” he noted.

Traditional benefits, such as healthcare coverage and retirement plans, have always been important to employees. According to Patrick Leary, vice president of Work Benefits Research at LIMRA in Windsor, Conn., traditional benefits make up the core of an employer’s value proposition to employees.

In putting together a benefits package, an employer decides whether a particular offering will be paid 100% by the employer, or use a cost-sharing approach in which employees contribute as well. A third option, known as a voluntary benefit, is completely paid for by the employee.

LIMRA provides research for the insurance and financial-services industry. One significant trend Leary has studied is the expanding demographics of the workplace.

“There are now five generations in the labor force,” he said. “The oldest workers are staying longer, while Gen Z is just beginning to enter the workforce.”

Each generation has different benefit needs, and they are all looking to their employer to address them. Voluntary benefits are one way for an employer to accommodate different needs among a diverse employee population.

Peter Miller

Peter Miller

“They are trying to strike a balance between offering a benefits package that is attractive to new hires, while also trying to control costs and keep the business running.”

“A company can offer a broad-based plan where some benefits appeal to younger workers and some to older,” Leary said. “Because they are voluntary benefits, the employer can address the various needs of their employees without increasing their costs.”

He emphasized the importance of employers working with a benefits consultant to find the right mix. “Part of the process involves the employer understanding their current employees and the types of workers they plan to recruit for the future.”

Employers typically add benefits to make their companies more attractive to the specific types of workers they seek. For example, Miller has been discussing benefit packages with a tech company looking to attract engineering graduates from prominent colleges. While traditional benefits are important, flexible work arrangements and college debt-repayment programs also have a strong appeal to this group.

“It’s important for employers to think outside the box to make themselves more attractive to the people they’re trying to hire,” he said.

College debt repayment offered as a formal benefit is relatively new, but it’s quickly becoming a popular benefit as more graduates enter the workforce saddled with large debt obligations.

Meredith Wise, president of the Employers Assoc. of the NorthEast, said employers are using different tactics to help new employees manage their student-loan debt. Some employers offer a hiring bonus so new employees can pay off a chunk of their student loan.

Another approach allows employees to pay down their debt and contribute to their retirement savings at the same time. Based on his conversations with employers, Leary said the 401(k)/student-loan payment approach strongly resonates with young employees.

“The amount the employee pays each month toward their debt is matched up to 5% by the employer in a 401(k) plan,” Wise said. “This is helpful to young workers who would not normally be thinking about their retirement savings because they are saddled with debt.”

 

What COVID Wrought

There’s nothing quite like a worldwide pandemic to remind everyone of the importance of having healthcare coverage. After 14 months of operating during the pandemic, the benefits professionals BusinessWest spoke with cited two notable trends: an increase in telehealth offerings and usage, as well as an increased demand for mental-health services.

“There’s definitely been an increase in utilization for traditional medicine and mental health,” Miller said.

Wise agreed. “Employers are looking at the mental-health benefits covered under their policies and, in many cases, are augmenting those benefits with employee-assistance programs,” she noted.

A survey released in March by America’s Health Insurance Plans reported that 56% of employees said their telehealth and mental-health services are more valuable now than they were a year ago, before COVID-19.”

Offering wellness programs as a benefit is another trend that has gained popularity in the last several years. “Employers are adding or increasing benefits around wellness, nutrition, stress management, and other areas,” Wise said.

In addition to health wellness, Leary said employers are increasingly offering financial wellness programs as a benefit.

Patrick Leary

Patrick Leary

“Some older employees might be sandwiched between taking care of their children and their parents at the same time, while others are looking at their planning needs for retirement.”

“If an employee is stressed out about their personal finances, it affects their productivity at work,” he said, pointing out that financial wellness is a benefit that can help employees at every stage of their careers by providing guidance tailored to their individual needs.

“It’s a chance to help younger employees get off to a good start and to check in with older Millennials, now approaching their 40s, about retirement planning and the telehealth benefit they can access,” Leary explained. “Some older employees might be sandwiched between taking care of their children and their parents at the same time, while others are looking at their planning needs for retirement.”

Because employees have so many different needs, communication around benefit offerings becomes essential. As COVID disrupted so many other norms, it also caused significant changes in benefit communications. But in this particular case, Miller said, the change was an improvement.

For years, the model for enrolling employees into a company’s benefit plan involved on-site meetings and speaking directly with as many employees as possible to make sure all their questions and concerns were addressed. Miller said the strong in-person presence continued even after the actual enrollments were done online.

“We’re doing many of our open-enrollment meetings now on Zoom,” he said. “One advantage is that you can gather employees no matter where they are for the live presentation, and they can ask questions, either by shouting them out or using the chat box.”

For employees who may be on vacation or traveling, the Zoom meeting is recorded and uploaded to a video-sharing platform like YouTube.

“Lots of people want to discuss their benefit options with their spouse,” Miller said. “Now they can, because everyone can access the presentation whenever they want.”

Miller said the video gives employers a tool they can use for the entire plan year. “When a new hire comes in, they can be directed to the link and listen in on the entire employee-benefit presentation. The video approach was one of the few positive developments that resulted from adjusting to COVID concerns.”

Sometimes, a new employee benefit can emerge from a catastrophe. At the onset of COVID, Leary said, employers were frantically setting people up at home just to keep their businesses in operation.

“Several months later, they began seeing the benefits of having people work from home,” Leary said. “While many are discussing a hybrid approach, where employees split their time between the office and home, working from home to some degree is now undeniable.”

Because his business lends itself to working remotely, Miller said his employees definitely perceive it as a benefit.

“If you asked me last February if working from home would be feasible, I would have said ‘no way,’” he noted. “But it not only works, it works very well.”

 

Help Wanted

These days, employers need every benefit they can offer when recruiting new employees. Despite businesses itching to expand, Miller said, employers face new challenges in doing so. “I’ve been doing this nearly 30 years, and I don’t ever remember so many different employers saying they can’t get good people.”

Local employers he’s speaking with are increasingly hiring workers from other states to meet their needs.

“My clients are looking for health plans that are more robust and have a national presence,” Miller said. “I’m hearing that from employers right here in Western Mass.”

For many, traditional benefits remain important, but they make up only a part of the employment experience. Leary said the move to remote work means employers and benefit consultants need to think in new ways to communicate benefits and enroll employees in a new hybrid environment.

“You can make the argument that flexible work schedules and the ability to work autonomously without having a manager look over your shoulder are also benefits that go beyond traditional health, dental, and disability plans,” Miller said.

It’s a trend to keep an eye on — one of many employers need to consider as they determine which benefits will attract and retain employees in a changing economy — while making sense for the company’s bottom line.

Accounting and Tax Planning Special Coverage

Selling Online?

In the early days of e-commerce, states attempted to get out-of-state companies to collect sales tax on transactions into the state — without success. Enter the Supreme Court, which issued a landmark decision that physical presence is no longer needed, and if a company’s activity has substantial ‘economic nexus’ with a state, it can be required to collect sales tax. That means online businesses of all kinds may have tax exposure they’re not even aware of.

By Kristina Drzal Houghton, CPA, MST

 

The shutdown of stores and malls during COVID-19 fueled the already-prospering world of internet shopping. Many businesses were forced into direct-to-consumer marketing on their own webpages or using e-commerce online marketplace companies such as Wayfair, Amazon, and Etsy, just to name a few.

So, why is this important to you? Well, if you are one of those businesses who started selling direct to consumers on your website or if you turned a previous hobby into a business venture that markets using an online marketplace that does not collect sales tax for you, you might have a significant tax exposure you’re not even aware of.

In the 1980s and 1990s, states attempted to get companies to collect sales tax on transactions into the state. These companies were predominantly located out of state and were making sales via mail or telephone calls. The companies were not collecting sales tax on the transactions.

The states were less than pleased. One state, North Dakota, passed a law requiring any company engaging in ‘regular or systematic’ solicitation in the state to become registered for and collect sales tax. In 1992, the U.S. Supreme Court held that a company needed to have a physical presence (employees, property, or offices) in a state before the state could require the company to collect sales tax. This landmark case was Quill Corp. v. North Dakota.

Quill made sales-tax compliance easy for companies: if a company was physically present in a state, it had to collect sales tax for that state. If the company was not physically present in a state, it did not have to collect sales tax, although it was inevitable that there would be some controversy about when companies were ‘present.’

Seeing revenues were on the decline, states began adjusting their tax laws or regulations. One by one, states devised new requirements to make companies collect sales tax. States enacted various laws or promulgated regulations to creatively find nexus, such as Massachusetts, which taxed sales based on an electronic ‘cookie’ on a computer, and New York, which developed so-called click-through nexus, taxing internet sales that were derived from clicking through advertisements on websites.

South Dakota was one state that enacted an economic nexus law. The South Dakota law says that if a seller makes $100,000 of sales into the state or has 200 or more sales transactions into the state in a calendar year, the seller must collect sales tax. The law did not impose sales taxes retroactively; it law was designed to provoke litigation and for the issue it raised to reach the U.S. Supreme Court as quickly as possible. South Dakota pursued four large companies it knew would meet its threshold. Three of those companies sued: Newegg, Overstock.com, and Wayfair.

The case became known as South Dakota v. Wayfair Inc. After rocketing the case through state courts and losing, South Dakota took its arguments to the U.S. Supreme Court and won. Now, physical presence is no longer needed; if a company’s activity has substantial nexus with a state, the state can require the company to collect sales tax on sales into the state.

“If you are one of those businesses who started selling direct to consumers on your website or if you turned a previous hobby into a business venture that markets using an online marketplace that does not collect sales tax for you, you might have a significant tax exposure you’re not even aware of.”

Almost all states with economic nexus allow an exception for small remote sellers, which is determined by a remote seller’s sales and/or transactions in the state (the economic-nexus threshold).

Any remote seller whose sales into the state meet or exceed a state’s economic-nexus threshold must register with that state’s tax authority, collect and remit sales tax, validate exempt transactions, and file sales-tax returns as required by law. Remote sellers whose sales and/or transactions in a state are under the state’s threshold don’t need to register; however, they do need to monitor their sales into the state, so they know if they develop economic nexus.

Unfortunately, state economic-nexus thresholds vary widely. This seriously complicates nexus determinations.

In a post-Wayfair sales-tax world, how are states enforcing the new economic-nexus rules and identifying companies that fall within them? Given the budget shortfalls due to COVID-19, states are identifying new ways to increase their revenue, and what better way than enforcing the Wayfair economic-nexus rules as they relate to sales-tax obligations?

Accordingly, states have taken a broader perspective on enforcing economic-nexus rules on various sellers (including internet retailers) by creating new registration and collection tools for all registered sellers. Under this new nexus standard, it is important to note that, if states find that the taxpayer purposefully did not comply with state law, then the departments of revenue (DORs) can not only require that the taxpayer pay back sales tax, but also assert that it is liable for penalties as well as interest.

 

Since the Decision

In the nearly three years since the Supreme Court in Wayfair upheld South Dakota’s economic-nexus law, overruling the court’s physical-presence precedents, states have faced challenges enforcing this new nexus standard on remote internet sellers, given that traditional audit approaches leverage information that is geared toward identifying sellers with some physical identity or connection within the state.

For example, if employees work in the state, the entity is required to file payroll taxes, or if the entity owns real property, then DORs can obtain real property and tax records to help validate sales tax compliance or identify potential audit targets. Economic nexus, however, provides fewer avenues for states to prove that an entity should collect sales tax in comparison to traditional physical-presence standards, where data is more readily available.

On the other hand, some states are taking an aggressive approach in seeking out taxpayers for compliance with the new nexus rules. For example, DORs are sending out more nexus questionnaires to various companies to, for all intents and purposes, scare them into compliance. Companies should take great care in responding to these questionnaires because states can use this information to force reporting for sales tax and other areas of taxation. To find targets, state auditors have been known to visit an e-commerce site and place an order to see if the seller charges sales tax. If no tax is charged, a questionnaire is then mailed to the seller.

Auditors can also check on companies that advertise heavily in their state or have achieved some level of public notoriety. States will also continue to look for sellers that may have established facilities in their state to make sales or store inventory. A facility or in-state inventory constitutes old-school physical presence and can be the basis of an audit stretching back to well before economic-nexus standards came into existence.

Some states are now ostensibly working to make sales-tax compliance and collection easier for taxpayers. Some examples include websites that allow users to manually calculate sales tax based on address, or an application programming interface (such as California’s) that can be integrated into retailers’ online order forms to determine the appropriate rate and taxing location in real time.

A majority of states now have such a lookup tool in one form or another. Arkansas has a tool for searching by ZIP code or address. The state of Washington’s lookup tool incorporates a state map, allows searching by geographical coordinates, and calculates the tax for any given taxable amount of sale. Colorado’s site incorporates a clickable map and provides a breakdown of tax-rate components.

Companies should be aware of and monitor their physical and economic presence nexus on a quarterly basis. Also, companies should defend against and challenge state assertions concerning sales-tax nexus rules, as well as petition Congress for clearer and more equitable nexus guidelines, especially during these times of financial upheaval caused by COVID-19. If organizations decide to register to collect sales tax in a state, they should take advantage of any benefits and tools the state is providing.

A company will be in a better position to manage its sales-tax collection responsibilities for a state if it determines whether it has physical or economic nexus before it receives a notice, letter, or nexus questionnaire from the state DOR.

 

Kris Houghton is a partner and executive committee member at Holyoke-based accounting firm Meyers Brothers Kalicka, P.C.; (413) 536-8510.

Community Spotlight Special Coverage

Community Spotlight

By Mark Morris

The final phase of the Columbia Greenway Rail Trail in Westfield should be complete this fall.

The final phase of the Columbia Greenway Rail Trail in Westfield should be complete this fall.

For Donald Humason, the phones ringing at Westfield City Hall is a sure sign the pandemic is nearing its end.

While recognizing that some people suffered devastating personal and economic loss, Humason remains grateful that, on the whole, Westfield came through the last 14 months better than expected. He credits the team at City Hall for working tirelessly with state officials to secure grants for Westfield agencies and businesses.

“At our weekly department meetings, I would always ask if we were prepared for the eventual end of the pandemic, so we would be ready when the phones start ringing again,” the mayor said. “Thanks to everyone’s efforts, I feel we are ready.”

Because construction crews continued working through the pandemic, Westfield saw progress on several infrastructure projects. In April, the main structure was installed for the Greenway Rail Trail bridge that crosses Main Street. As the trail continues through Westfield, it will be an elevated path with exit ramps that drop down to local neighborhoods and businesses. Humason expects the final phase of the trail to be complete this fall.

“This last section of the trail is taking longer because there are several overpass bridges which are more complicated to build than the pathway itself,” he said.

Meanwhile, Westfield-Barnes Regional Airport recently broke ground for a $4.7 million taxiway project that will benefit both military and civilian air traffic. Another improvement at Barnes involves a private company looking to build three new aircraft hangars, Humason noted.

“These are not the sexy projects, but they need to get done so we can keep everything working.”

Massachusetts state and federal legislators are currently on a campaign to bring the next generation F-35 fighter jets to the Air National Guard’s 104th Fighter Wing at Barnes.

Humason said he appreciates having a fleet of F-15 fighter jets based at Barnes, but it’s worth pursuing the newer jets, too. “We are competing with several states in the Northeast to get the F-35s. We’ve modernized the base, and we’re ready to accommodate them if we are chosen.”

On the other side of the city, work has begun to replace Cowles Bridge on Route 202 that connects Westfield to Southwick. This state project marks one of the last bridges in Westfield that hasn’t yet been updated. Because the city is situated between several rivers, Humason said, Westfield is like an island in some ways because many entries into town involve crossing a bridge. He predicts Cowles Bridge will be completed in about two years.

“While it’s not a big bridge, it carries every important infrastructure in the city, so that makes it a more complex project because several utilities have to be involved in moving the structures under the bridge,” he explained.

Other projects, such as pump stations and sewer replacements, are also in the works. While these projects are not as high-profile as bridges and bike paths, they are essential, the mayor said. “These are not the sexy projects, but they need to get done so we can keep everything working.”

Meanwhile, infrastructure work of a different kind — expansion of Whip City Fiber, a division of Westfield Gas & Electric — continues to build momentum and become an increasingly powerful force in efforts to attract and retain businesses (and residents) in Westfield and several surrounding communities.

Tom Flaherty, general manager of the G&E, told BusinessWest there are now just under 11,000 subscribers in Westfield and 19 surrounding hilltowns, with the goal, one he considers very attainable, of reaching 15,000 within the next three years.

The high-speed internet, as well as low-cost, reliable electric service from the municipal utility, have become strong selling points for the city, said Flaherty, noting that businesses looking to relocate or expand put such services at or near the top of their list of considerations for such initiatives.

“The reliability of our electric and natural-gas infrastructures and the lower cost in comparison with other utilities — we’re more than 40% cheaper — are a huge consideration when people are coming out this way looking for houses,” he explained. “Whip City Fiber is a significant selling point when people are relocating and when businesses are relocating.”

As an example, he cited Myers Infosystems, which recently relocated from Northampton into the site of the former Piccolo’s restaurant on Elm Street, and cited energy costs and high-speed internet as key considerations in that decision.

 

Survive and Thrive

Eric Oulette, executive director of the Greater Westfield Chamber of Commerce, said many of the businesses in Westfield were able to stay open last year because they quickly adapted once the pandemic hit. In particular, he pointed to the adjustment restaurants made last June when they were able to offer outdoor dining.

“They figured it out and made outdoor dining another feature they could offer,” Oulette said. “It was successful and allowed them to keep their doors open.”

With only a few chain restaurants in the city, Oulette said local restaurants are able to promote their individual personalities and offer many different experiences. That environment also encourages other types of small businesses to locate in Westfield.

Mayor Donald Humason

Mayor Donald Humason said the city was successful meeting the needs of residents, students, and seniors during the pandemic, and will now put more focus on business needs.

Humason told the story of three new businesses that opened in April on School Street. Hilltown Chic (small gifts, candles, etc.), Be Bella Boutique (clothing), and Boho Hair Studio are all women-owned businesses. The owners got together and decided to hold their grand openings on the same day.

“We went right down the street and cut the ribbon in front of each shop,” Humason said. “It felt like a street carnival, and the businesses all received extra publicity for it.”

Speaking of new businesses, Westfield has granted four licenses for cannabis dispensaries. Only one, Cannabis Connection, is currently open, with the others at various stages of getting ready to open.

“We are still early in the process with cannabis in Westfield, so, from a revenue perspective, we consider these eggs we have not yet put in our basket,” Humason said.

As businesses pick up their activity, he added, they will need more workers — and, like everywhere else, Westfield has far more job openings than candidates.

In May, Mestek joined with the chamber and about a dozen other businesses and held a job fair in the field across from Mestek, with each exhibitor setting up a tent to speak with interested job seekers.

“We are still early in the process with cannabis in Westfield, so, from a revenue perspective, we consider these eggs we have not yet put in our basket.”

The idea for the job fair started with Peter Letendre, plant manager at Mestek, which manufactures HVAC equipment and performs metal fabrication for other industries. The company had recently acquired its main competitor and was relocating the operation from Long Island to Westfield, bringing 60 to 70 new manufacturing positions along with the move. Traditional recruiting wasn’t working to fill those jobs, so Letendre had to look at other ways to find people.

“I’m on the board at the chamber and began talking with other members about holding a job fair,” he said. “That way, we could all help each other by attracting candidates for our respective companies.”

In addition to Mestek, exhibitors included Six Flags of New England, C&S Wholesale Grocers, Northwestern Mutual, and several others. A few weeks after the job fair, Letendre reported that Mestek had hired about 15 employees, with another 10 in the process of coming on board.

Many of the positions offered by the job-fair exhibitors offered starting pay that was higher than minimum wage. For instance, Letendre said, the entry-level starting rate at Mestek is $15.50 an hour, and after 90 days, if the employee performs well and demonstrates good attendance, the pay increases to $16. As they acquire more skills, their wage can rapidly increase from there.

From working with sheet metal to assembling HVAC units and warehouse work, Letendre said Mestek offers lots of opportunity for growth. “You can start off in manufacturing, then keep improving your skills and build a solid career here.”

Plans are underway for a second job fair at the end of the summer. While many would-be job seekers are currently receiving supplemental unemployment benefits, that program ends in September, Oulette noted. “Right now, there are lots of companies looking to hire above minimum wage, so my one message to job seekers is, don’t wait until the fall when the unemployment benefits end, because there will be much more competition.”

While he is the new executive director of the chamber, Oulette is no stranger to Westfield. He worked with the Boy Scouts of America Western Massachusetts Council for five years and was president of the Rotary Club of Westfield in 2019 and 2020. He accepted a director of Development position for the Boy Scouts in 2020 that had him spending several days a week in New Hampshire. When the pandemic kept him at home, he wanted to stay in Western Mass. and accepted the chamber position in April.

While new to chamber leadership, Eric Oulette

While new to chamber leadership, Eric Oulette is no stranger to civic life in Westfield, including service with the Boy Scouts and the Rotary.

Oulette is the first to admit he had to “fill some big shoes” following Kate Phelon, who retired in September after 12 years leading the chamber. He appreciates how welcoming everyone has been as he transitions into the new post.

“It’s just like starting any new job where information is coming at you like you’re drinking from a firehose,” he said with a laugh.

 

Back to Business

Flaherty, like Oulette, is optimistic about the city’s prospects for continued residential and commercial growth, noting that it has a number of strong selling points, including location, strong schools and neighborhoods, and, as mentioned earlier, lower-cost energy and an expanding fiber-optic network.

And this expansion may soon take Whip City Fiber well beyond the city’s borders, he said, adding that the utility is in discussions with West Springfield about a pilot program to bring high-speed internet service to areas of that city as it advances plans to build a town-owned internet utility in partnership with Westfield G&E.

“We’re looking at four potential pilot areas that would be installed over the next year while the city goes through the process for the community to become a municipal light plant, or MLP,” he explained, adding that expansion into the neighboring city could eventually bring another 13,000 subscribers to the service.

Meanwhile, there are preliminary talks about taking the service to other communities as well, Flaherty said.

“There’s a good level of trust concerning our product and our capabilities — we have all the infrastructure, we have the billing system, we have the customer in place, we have the utility capabilities, the bucket trucks, and the line personnel,” he noted, adding that the company is well-positioned for continued growth.

As is Westfield itself. Oulette and Humason are grateful the city was not forced to confront big job losses or high numbers of business closings. Despite the pandemic, the mayor noted, Westfield kept moving forward.

“While our schools faced issues of whether they were going to hold classes remotely or in-person, we still continued with education,” he said. “We were still able to serve our senior citizens even though we couldn’t meet at the Council on Aging. We were also able to keep our infrastructure projects moving despite the pandemic.”

Humason added that, because Westfield has taken care of residents, schools, and seniors, he now looks forward to giving more attention to expanding businesses in the city. “I’ve said this since the day I was sworn into office: Westfield is open for business.”

Accounting and Tax Planning

Death and Taxes

By Jim Moran, CPA

 

On April 28, the Biden administration released its FY 2022 revenue proposals. Along with raising the corporate tax rate to 28% and the top individual rate to 39.6%, widespread changes have been proposed to the capital gains tax rate and estate tax.

Under current federal law, upon death, property passes to a beneficiary at fair market value, with a few exceptions. This means the beneficiary’s basis generally becomes the value of the property at the decedent’s date of death, also referred to as ‘step-up in basis.’ For gifts made during a donor’s lifetime, the donee receives the donor’s basis in the property. This means the donee’s basis remains the same as the donor’s basis, generally original cost plus any improvements. No taxable gain or loss occurs upon the transfer of the property. Gain or loss is realized only when the property is eventually sold.

Under the Biden administration’s proposal, transfers of appreciated property upon death, or by gift, may result in the realization of capital gain to the donor or decedent at the time of the transfer. This means tax may be triggered at the date of the transfer regardless of whether the property is subsequently sold. This would be accomplished by eliminating the step-up in basis upon death of a decedent and requiring a tax be paid on a portion of the value of a gift made.

Fortunately, the Biden proposal would allow a $1 million per-person exclusion from recognition of unrealized capital gains on property either transferred by gift or held at death. The per-person exclusion would be indexed for inflation after 2022 and would be portable to the decedent’s surviving spouse under the same rules that apply to portability for estate- and gift-tax purposes (making the exclusion effectively $2 million per married couple). It is important to note, however, in the case of gifts, the donee’s basis in property received by gift during the donor’s life would be the donor’s basis in that property at the time of the gift to the extent that the unrealized gain on that property counted against the donor’s $1 million exclusion from recognition.

“Under the Biden administration’s proposal, transfers of appreciated property upon death, or by gift, may result in the realization of capital gain to the donor or decedent at the time of the transfer. This means tax may be triggered at the date of the transfer regardless of whether the property is subsequently sold.”

Tangible personal property (other than collectibles) would also be excluded from the triggering of gain. The exclusion under current law for certain small-business stock would remain, and the $250,000 per-person exclusion under current law for capital gain on a principal residence would apply to all residences currently allowed under IRC Section 121 and would be portable to the decedent’s surviving spouse, making the exclusion effectively $500,000 per couple.

The Biden proposal allows for some exempt transferees. Property transferred by a decedent to a charity would be exempt. Transfers by a decedent to a U.S. spouse would be at be the carryover basis of the decedent, and capital gain would not be recognized by the surviving spouse until the surviving spouse disposes of the asset or dies.

In addition to transfers upon death or gift to an individual, transfers of appreciated property into, or distributed in kind from, trusts (other than revocable grantor trusts) and partnerships may be treated as recognition events for the donor or donor’s estate. Valuation is another important concern in regard to a partial interest. The transfer of a partial interest would be at the ‘proportional share.’ Valuation discounts for minority interests will not apply.

Under Biden’s proposal, the donor would report any deemed recognition events on the donor’s gift-tax return. A decedent would report any capital gains on an estate-tax return or, potentially, a separate capital-gains return. A decedent would be able to offset capital gains against any unused capital-loss carry-forwards and up to $3,000 of ordinary income on their final individual income-tax returns. Any capital-gains taxes deemed realized at death would be deductible on the decedent’s federal estate-tax return if required.

The proposal would be effective for gains on property transferred by gift and on property owned at death by decedents dying after Dec. 31, 2021.

With a 50/50 partisan split in the U.S. Senate, it is currently unclear what the final proposal will end up being. Now is the time to start thinking about the how the proposed changes will affect you. Make an appointment with your tax or financial-planning professional to discuss what steps you should consider taking. You may need to be willing to act quickly should these proposals become reality.

 

Jim Moran, CPA, MST is a manager with Melanson CPAs, focusing on commercial services and tax planning, compliance, and preparation.

Opinion

Opinion

By John Regan

 

Associated Industries of Massachusetts (AIM) and the Commonwealth’s business community join with our fellow citizens in celebrating the first official state observance of Juneteenth, which commemorates the day in 1865 — June 19 — that the last enslaved people held in Galveston, Texas learned of their freedom, two years after President Lincoln issued the Emancipation Proclamation.

The day is both an historical observance and an opportunity to reflect on the accomplishments of African-Americans here in Massachusetts and throughout the nation. It is also a reminder of an event largely ignored by history texts, much like the Tulsa massacre that took place 100 years ago.

AIM — as an organization committed to diversity, equity, and inclusion — regards the day as a symbol of the importance of creating an economy that provides opportunity for all the citizens of Massachusetts.

“The Juneteenth holiday is a long-overdue teaching moment about the contributions and history of a people who were instrumental in building the country. Reminders of what has kept us apart are necessary to forming bonds that bring us together moving forward,” said Donna Latson Gittens, founder of MORE Advertising in Watertown and a member of the AIM Executive Committee.

Gov. Charlie Baker signed a bill last July making June 19 a limited-scope holiday, analogous to Patriots’ Day, Presidents’ Day, and Martin Luther King Day. Private employers may elect to observe the day but are not required to do so. Creation of the state holiday came amid a national racial reckoning following the death of George Floyd and several other black people during encounters with police.

Employers plan to mark Juneteenth in various ways.

AIM member National Grid announced that all of its U.S. employees, including 6,336 employees in Massachusetts, would be given the Friday before Juneteenth off as “a symbol of our dedication to honoring black Americans who have suffered the impacts of racism throughout U.S. history,” according to Natalie Edwards, the company’s chief diversity officer.

The company encouraged its workers to use the time off as “a day of reflection and to celebrate black communities, particularly in the neighborhoods where they live and work.”

AIM members New Balance, Foley Hoag, Boston University, Harvard University, and Morgan Memorial Goodwill Industries have also instituted Juneteenth as a paid holiday. Other members, such as Fidelity Investments and Santander Bank, are conducting or sponsoring online events to discuss diversity and financial issues in communities of color.

When Baker signed the law last July, it was in recognition of “the continued need to ensure racial freedom and equality,” he said. “Juneteenth is a chance for us all to reflect on this country’s painful history of slavery and the systemic impact that racial injustice continues to have today. It is also an opportunity to recommit ourselves to the goal of creating a more equal and just society.”

 

John Regan is president and CEO of Associated Industries of Massachusetts.

Construction Special Coverage

Framing the Issue

Few industries have been immune to the supply shortages and rising costs that have plagued the world economy over the past few months, but construction is especially vulnerable, relying heavily on materials — most notably lumber and steel, but dozens more as well — riddled by soaring prices. The good news is that demand for work is high, but many still worry about the long-term implications of a cost problem with no end in sight.

 

By Mark Morris

Early in 2020, several lumber mills and steel plants expected demand for their products to take a nosedive once the pandemic hit, so they slowed down or closed some of their operating plants. Instead, after only a brief hiatus in March, home and commercial construction resumed — and then significantly increased.

For Bob Boilard, vice president of Boilard Lumber, the decreased supply of lumber and growing demand have created multiple challenges. Orders for lumber that once took a week for delivery now have vague timetables and constantly changing prices.

“Pricing right now is set at the time of shipment, so we don’t know exactly what it’s going to cost us until it’s on the back of a truck,” Boilard said.

Because lumber prices change so often, Boilard and dealers like him study the commodity market every day to make sure they stay current. At press time, an eight-foot 2-by-4, used primarily to frame houses and certain commercial buildings, had increased to $11, up from $4 several months ago, a price hike of 175%.

Nick Riley

Nick Riley says shortages are nothing new in construction, but so many types of materials being in short supply at one time is very uncommon.

Construction professionals have called this an unprecedented time. Price hikes and shortages of certain building materials are nothing new to the construction industry, but no one has seen inflation and scarcity of so many supplies that go into building a house or a business.

BusinessWest spoke with several construction managers who said we are currently in a perfect storm of greatly increased demand, COVID-related manufacturing slowdowns, and, literally, storms.

For instance, back in February, ice storms knocked out the power grid in Texas, shutting down several resin plants there and in neighboring Louisiana for several weeks. The resins from these plants are used in a broad range of building products, from adhesives to make plywood to the plastic that insulates electric cables. The resins are also used in many paints and primers.

“This is the first time I’ve seen drastic increases and shortages affect this many products. In the past, we’ve seen oil prices drive up the cost of roofing shingles, but never across the board with nearly every building material.”

Dan Bradbury, director of Sales and Marketing for Associated Builders, said the commodity price he follows closely is cold rolled steel. Most of the structures his company builds are pre-engineered metal buildings for commercial and industrial use.

“Cold rolled steel prices have increased 225% since last August,” Bradbury said. Due to shortages in getting the steel, he tells customers the building they order today will be delivered in about 20 weeks. Before COVID-19, that same project would take 10 to 12 weeks.

Increases and shortages don’t end with commodities, but also affect other materials involved in construction. Craig Sweitzer, co-owner of Sweitzer Construction, said an electrical contractor told him about the price instability of a heavy-duty cable used in commercial applications.

“His supplier would only hold the price for one day,” Sweitzer said. “Usually, our material prices are good for 15 days, so we’re not used to seeing this.”

What makes this time different is the broad array of materials impacted, said Nick Riley, owner of N. Riley Construction.

The price of a basic 2-by-4 has risen by 175% in recent months.

The price of a basic 2-by-4 has risen by 175% in recent months.

“This is the first time I’ve seen drastic increases and shortages affect this many products,” he noted. “In the past, we’ve seen oil prices drive up the cost of roofing shingles, but never across the board with nearly every building material.”

As someone who builds medical and dental offices, Sweitzer uses steel studs in place of 2-by-4 wood studs for interior wall partitions. At one time, the two products were close in price. While prices for both have increased, a steel stud is now far less expensive than wood.

“While the price of a steel stud has increased about 30%, it’s well below the double and triple price hikes we’ve seen with wood,” he said, adding that he’s also experienced shortages in random materials such as joint compound to finish walls, acoustical insulation, and interior doors. “There’s a particular style of door we use that once took a week to get. Now it can take eight weeks, and the price has increased.”

 

Steady On

Despite shortages and price hikes, the construction managers we spoke with are all grateful to have plenty of work scheduled.

“I’m fortunate to be busy, and at the same time, it’s incredibly stressful to keep everyone happy and meet deadlines,” Riley said. “It’s a crazy time right now.”

To manage some of that craziness, he has invested in a new tool, a CRM (customer relationship management) system.

“Through our system, we can keep everyone on the same page, and it allows customers to check in on their project,” Riley said. “By staying in closer contact with our customers, they’ll know immediately about any issues that might slow down a project.”

Managing expectations becomes essential when prices and timelines are uncertain. When someone wants a fast turnaround on a project, Bradbury gives them straight talk. “We’re honest and upfront with our customers as to what’s realistic,” he said.

Some customers have chosen to delay their projects, anticipating that prices may come down. Bradbury said that may work for some, but when a company needs a building to grow their business, they can’t always wait it out.

“My advice is to build it sooner rather than later because we are more likely to see further price increases,” he said. “Also, with lead times so long, the sooner you get in the queue for your project, the better off you’ll be.”

Beyond materials, shortages have also extended to the human element. Riley said finding laborers for home building has always been challenging, and the increased demand for new homes only exacerbates an already-tough situation.

One of the thorniest challenges to solving supply shortages, Boilard noted, involves finding truckers to move the goods. “You can’t get drivers to get behind the wheel of a tractor-trailer. There are lots of trucking jobs open right now, but few people to fill them.”

Construction workers were deemed essential during the pandemic, so their time off the job was brief. Bradbury said the short shutdown allowed his company to retain most of its workers. “Some of our subcontractors have felt labor shortages, but we are grateful that has not had a significant impact on our business.”

When COVID first hit, Sweitzer gave all his employees a raise to make sure they were compensated well enough to stay with his company. “We’ve been lucky because we have an extremely good and loyal crew. I’ve found that good labor is worth the investment.”

 

Looking Ahead

Predictions on when prices and supplies might stabilize is anyone’s guess. Boilard explained that his company determines its lumber-buying needs early in the year, which these days is a real challenge. If a dealer stocks up heavily now only to see prices eventually crash, they are stuck with expensive inventory in a market that no longer supports those higher prices.

This building under construction shows how much cold rolled steel Associated Builders uses in a project.

This building under construction shows how much cold rolled steel Associated Builders uses in a project.

“It’s not a fun time because we have to do a balancing act of meeting our customers’ needs without having too much inventory on hand,” he said.

Riley has seen conflicting predictions about lumber prices dropping either at the end of 2021 or sometime in 2022. He’s seen lumber and electrical wire come down before, but he’s more concerned about other materials that go into building a house.

“In my years in business, when windows, siding, and roofing shingles increase in price, I’ve never seen them come back down,” he said. “I think increases like that are here to stay.”

Bradbury said he can’t predict what will happen in his industry, but he hopes to see the supply of steel catch up to demand by the end of this year. “My best guess is supply will get better and lead times will improve before we see prices start to stabilize.”

Sweitzer noted that he has a degree in management, while his two sons have degrees in economics and business administration, so they often discuss what may lie ahead. And their conversations have been optimistic.

“Markets always find some level of equilibrium, and I believe that will happen in this market,” he said. “Market equilibrium may take a temporary vacation, but it has always returned, and I think it will again.”

Health Care Special Coverage

An Anxious Transition

While the economic reopening is being called the ‘new normal,’ things aren’t back to normal, really — at least not by pre-pandemic standards. With COVID-19 still lingering, developments like the loosing of mask and gathering rules and a growing call for employees to return to the office have only ratcheted up the stress and anxiety among a broad swath of the population. In other words, for many, returning to the world as they knew it will be a gradual process.

By Mark Morris

In these unique times when COVID-19 is still active but in decline, we all have lots of questions about how to navigate daily life.

For example, if you have been vaccinated, should you continue to wear a mask? Why does the CDC say you can go without a mask, yet many public places still require one?
Should we still socially distance and sanitize in certain situations?

And, importantly, how much anxiety are such questions causing these days?

Answers can come from many places. Lauren Favorite, assistant program director with Behavioral Health Network, noted that, while information can be good, an overload of messages from different sources results in confusion.

“When we are bombarded with a plethora of information, it’s difficult for people to make a singular choice that will be the right one for them,” Favorite said. “Too much conflicting information can create anxiety.”

“Because so many people are not sure what to do, they will hold on to behaviors even when they no longer serve their intended purpose.”

BusinessWest spoke with several behavioral-health professionals who said much of the stress people are feeling right now is rooted in their concerns about how safe it is to go back into the world. Despite the May 29 reopening of Massachusetts, allowing everything from restaurants to sports arenas to fully welcome the public, Alane Burgess, clinic director for MHA’s BestLife program, said many people still do not feel safe going to the supermarket.

Alane Burgess

Alane Burgess says it’s always easier to learn how to be afraid than to unlearn that mindset.

“It’s always easier to learn how to be afraid than it is to be unafraid,” Burgess said. “Even when we’re told everything is OK, people still have questions.” As COVID-19 is a relatively new virus and scientists are still learning about it, continued concerns about personal safety are not surprising.

A recent research article looked at the trauma experienced by refugees after they emerged from a war-torn country. Favorite said their experience serves as a metaphor for these times.

“In the war zone, they had to develop certain habits and routines as a way to survive,” she said. “Once they escaped and reached a safe place, they held on to those behaviors because they didn’t know how else to act.”

All behaviors have a motivation, she continued, and the ones we followed to stay safe during the pandemic served us well. As we move beyond the pandemic, however, it’s time to examine if those behaviors are still serving us.

“Because so many people are not sure what to do, they will hold on to behaviors even when they no longer serve their intended purpose,” Favorite said. “I think many people will be in a sort of in-between place until we start to see a critical mass of vaccinations.”

 

Baby Steps

For many, entering back into the world needs to be a gradual process. Kathryn Mulcahy, clinic director for Outpatient Behavioral Health Services at the Center for Human Development, encourages her clients to start small.

“Instead of trying to do everything at once, I remind people it’s OK to take baby steps,” Mulcahy said. “You might not be ready to go out to the movies, but you can start getting back into the world by taking a walk in your neighborhood.”

As an incentive to go out again, Burgess advises her clients to make a bucket list of activities they are excited about doing again. “Making a list reminds people of what brought them joy before COVID and can help motivate them to get back to doing those things again.”

lauren favorite

Lauren Favorite

“I think many people will be in a sort of in-between place until we start to see a critical mass of vaccinations.”

COVID also had a significant impact on the nature of work. Depending on the occupation, some people reported to work every day during the pandemic, while others followed a more hybrid approach of working at home some days and at the office other days. A third group has been working from home since last March.

Employers have begun asking Joy Brock, director of the CONCERN Employee Assistance Program, how to proceed as we move toward the end of the COVID era.

“Companies are struggling with how to translate all the different mandates,” Brock said. “They are having as much anxiety as their employees.”

According to the Massachusetts Attorney General’s Fair Labor Division, employers are allowed to ask if an employee has been vaccinated. In some cases, they can require vaccination in order to report to work. Exceptions are allowed for those protected by legal rights, such as individuals who have disabilities or those with sincerely held religious beliefs.

Brock said even those distinctions beg more questions. “What if I’m vaccinated, but the person next to me isn’t? How is that going to work with masks, social distancing, and other considerations?”

When there is no clear-cut direction, individuals usually figure out how to keep themselves safe. Brock said even modest steps to take control over one’s health can help reduce anxiety. “If that means you are the only one in the office wearing a mask, that’s perfectly fine.”

Finding a comfort level at work and in the world ultimately depends on the individual. Burgess emphasized that everyone is on their own journey, and it’s OK to move at a different pace than others.

“I advise people to be patient with themselves and not make any self-judgments just because their comfort level is different than their friends or co-workers,” she said.

One clear demand Brock has heard from workers involves flexibility in work schedules.

“For the most part, people have enjoyed working from home because it makes child care easier to manage, they have been able to match or exceed their productivity, and many report lower stress levels,” she said.

With that in mind, many employers are looking at a hybrid model and trying to figure out the right mix between working at the office and from home.

Kathryn Mulcahy

Kathryn Mulcahy

“Instead of trying to do everything at once, I remind people it’s OK to take baby steps. You might not be ready to go out to the movies, but you can start getting back into the world by taking a walk in your neighborhood.”

A return to the office also means remembering how to be a colleague. Even if co-workers talk remotely every day, Mulcahy said people can get out of the habit of face-to-face conversations.

“As silly as it sounds, practicing an in-person conversation with someone outside your bubble is one more way to prevent that overwhelming feeling of being thrown back into the workplace,” she explained.

Beyond water-cooler discussions, Burgess said a successful transition back to the office also requires companies to be tuned in to the apprehensions their employees may have. “It will be important for people to have an open dialogue with their employers about any anxieties or concerns they may be feeling.”

Added Favorite, “as a supervisor in the workplace, I’m having conversations with my staff to assuage their fears about coming back on site.”

 

Talk About It

One key to putting COVID behind us is recognizing what everyone has gone through since last March.

“For the past 14 months, we’ve lived in a world full of trauma,” Burgess said. “The idea that we can suddenly go back to the way everything was is an impossible task.”

Mulcahy said she has heard from people who are embarrassed because they feel stressed and anxious about returning to a more normal life.

“They feel like they should be happy and excited that people are vaccinated, but instead they just feel worried,” she noted. “I want people to know they are not alone and they can reach out for help to navigate these feelings; that’s why we’re here.”

Burgess also pointed out that life was different during the pandemic, and we should accept that we are not the same people we were before.

“Our life has changed, and we have changed in some of the ways we think, how we feel, and what feels safe,” she said. “It’s important to respect who we are today because that, too, is part of the process in getting back into the world.”

When everyone was forced to suddenly deal with a pandemic, it created anxiety for many. Now, as the pandemic (hopefully) nears its end, that creates anxiety, too. Those who spoke with BusinessWest agree that talking about this stress, and letting people know their feelings are valid, will go a long way to easing everyone’s anxiety.

After all, Favorite said, “we’re still learning how to be in a world where we don’t have to worry all the time.”

Community Spotlight

Community Spotlight

By Mark Morris

Michelle Theroux

Michelle Theroux says businesses in town, including her own, Berkshire Hills Music Academy, are anxious to ramp up operations as the economy reopens.

 

For Mike Sullivan, the past 15 months have been a learning experience on many levels.

As town administrator in South Hadley, Sullivan has learned just how essential online payment systems and Zoom meetings have become for residents who need to do business with the town.

“As we make more access points available to the public, we’ve seen participation in government increase,” Sullivan said, adding that, while many people are looking forward to meeting in person again, Zoom is also here to stay.

The pandemic also taught him about the efficiencies of running Town Hall. By limiting in-person visits to appointment only, staff have been able to more efficiently get business done. Going forward, he looks to follow a model other towns have adopted of limiting hours or closing to the public one day a week.

“There are multiple ways to take care of business,” Sullivan said. “I appreciate that some people have complicated business they need to conduct in person, and we will accommodate them. When residents use online platforms or even ‘snail mail’ instead of visiting Town Hall, it saves money for the town and for everyone’s individual taxes.”

Sullivan made plenty of adjustments to keep South Hadley moving forward during the pandemic. Attendees to last year’s town meeting, for example, never left their cars.

“People tuned into the discussion over their car radios, just like an old drive-in movie,” he said. A similar drive-in town meeting is planned for this year, but there will also be a seating area for those who feel safe enough to leave their cars. “We’re looking forward to getting back to some semblance of normalcy.”

Michelle Theroux, president of the South Hadley and Granby Chamber of Commerce, said one indication of a return to normalcy is the “we’re hiring” signs around town. She acknowledges there are many factors why people are not immediately returning to work, but even with recruitment issues, the signs represent a positive step.

“The good news is that people are looking to hire, and they are in a position to bring people back into the workforce,” she said.

As the end of the pandemic nears, Theroux credits the South Hadley community for its support of small business. From restaurant takeout orders to holiday shopping, it was local people who provided enough support so that no chamber-member businesses permanently closed due to the pandemic.

“Certainly, many downsized and did what they had to do to survive,” she said. “It’s a real credit to community support because small business is such an important part of South Hadley.”

Because small business is such an essential part of South Hadley, banks in town worked with the chamber to secure Paycheck Protection Program funds for businesses in town. In addition, the chamber recently partnered with the Northampton chamber and the Massachusetts Office of Travel & Tourism to secure $20,000 in state grants.

“The good news is that people are looking to hire, and they are in a position to bring people back into the workforce.”

The chamber also spread the word among its members on how they could help each other, as well as support businesses that are not necessarily top of mind.

“If you look at the South Hadley Commons, we all think of the great restaurants there,” Theroux said. “The Commons also has a movie theater and a number of small boutiques that offer unique and personalized items you can’t find at a big-box store.”

 

Forward Momentum

One key project that kept going during the pandemic involves the Woodlawn Shopping Plaza. At one time the site of a Big Y supermarket, the parcel now features various retail stores anchored by Rocky’s Hardware. The site has been approved for a 60-unit, mixed-income apartment complex that will occupy three acres in the back of the parcel.

“Way Finders of Springfield is running the housing-complex project, and they are waiting for federal funding to come through before they break ground,” Sullivan said.

Theroux is excited about the project because it provides a glimpse at the future of development.

“At Woodlawn, you have a multi-use site with different types of businesses and living options all in one central location,” she said, while predicting that the entire area surrounding Woodlawn will see a revitalization over the next several years. As one example, Northampton Cooperative Bank and PeoplesBank have recently opened branches in or near the Woodlawn Plaza.

Sullivan also pointed with pride to the new senior center on Dayton Street, which is scheduled to open June 30.

“We were able to successfully build the senior center during the pandemic, and the costs were below the estimated bids,” he said. “Even with increases in some of the materials, we will still come in nearly $700,000 under the original estimate.”

South Hadley at a Glance

Year Incorporated: 1775
Population: 17,791
Area: 18.4 square miles
County: Hampshire
Residential and commercial tax rate: $19.46 (Fire District 1); $19.80 (Fire District 2)
Median Household Income: $46,678
Median Family Income: $58,693
Type of government: Town meeting
Largest Employers: Mount Holyoke College; the Loomis Communities; Coveris Advanced Coatings; Big Y
* Latest information available

Six years ago, Mohawk Paper opened a plant in South Hadley to great fanfare and optimism for a long relationship with the community. Last year, in pursuit of more favorable taxes and incentives, the company closed its operations in South Hadley and moved to Ohio.

As tough as it was to see Mohawk pack up and leave, Sullivan noted that E Ink, the company located across Gaylord Street from the former Mohawk plant, has good news moving forward. “E Ink is planning to double in size because they have a new product line coming out.”

E Ink makes the agent used in tablets like the Amazon Kindle, which allows an electronic page to read like a physical book. In addition to tablets, E Ink screens are used in a variety of applications ranging from signage at MBTA stations and international airports to retail price signs.

On top of contributing as a successful company, Sullivan noted that E Ink is a strong supporter of community projects and events in South Hadley.

Meanwhile, the Ledges Golf Club, owned by the town and a financial drag for many years, is on its way to performing at par. At the beginning of the pandemic last year, golf courses across the state were mandated to stay closed for several weeks. Sullivan called the lost months a “kick in the shins” because, once it opened, the Ledges did brisk business all season and came close to hitting a break-even point.

“This year, we made $200,000 in revenue in just March and April,” Sullivan said. “By the end of the fiscal year next June, we think the Ledges will break even.”

In addition to her duties as chamber president, Theroux’s full time job is executive director of Berkshire Hills Music Academy (BHMA), a music-infused program that helps young adults with special needs to expand their social, vocational, and life skills. Before the pandemic, BHMA employed just over 100 people. Though it normally offers both residential and day programs, state mandates forced BHMA to quickly shift to remote classes for its day students. After furloughs and layoffs due to the new mandates, 64 staff remain.

“Our current state is a hybrid model where we have about 40% of our day students back on campus, with the rest joining us by remote,” Theroux said. “Once we can fully reopen, we’d like to staff up to where we were before the pandemic.”

Looking ahead to the fall, she wasn’t sure what to expect for new enrollments, but was pleasantly surprised to see strong numbers for BHMA’s incoming class.

“Once their loved one is vaccinated, many families are all in on our program, and that’s a huge positive for us,” Theroux said. “Three months ago, I would not have been as confident about what next year would look like.”

 

Back to School

After more than a year of remote learning, Mount Holyoke College students have begun to return to campus. While remote learning is still available, many have indicated they plan to return to campus in the fall.

“The presence of Mount Holyoke students back on campus will provide a real boost to South Hadley feeling normal again,” Theroux said.

Sullivan is on the move, too. After a long career of public service, he has announced he will retire in June. Looking back, he points to a number of projects he’s helped shepherd to success. One area of particular pride is the progress South Hadley has made in hiring a more diverse workforce. As an example, he mentioned Police Chief Jennifer Gundersen, who recently joined South Hadley’s force after several years in Amherst.

“Certainly, many downsized and did what they had to do to survive. It’s a real credit to community support because small business is such an important part of South Hadley.”

Sullivan in only one of South Hadley’s leaders who are moving on. Planning Director Richard Harris is also retiring, and the superintendent of schools left in December to pursue another professional path.

While grateful for their service to the town, Theroux sees this as a time for South Hadley to bring new faces into leadership roles.

“As we emerge from the pandemic, I’m optimistic about the future and a new era of leadership for our town,” she said, adding that she looks forward to people once again enjoying all that South Hadley has to offer.

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