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An Open Door

By BusinessWest Staff June 7, 2010

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Karoun Yoga Meets a Need in Springfield — for the Gift of Peace and Silence

Karoun Charkoudian says her passion for yoga — and desire to share it — deepened around the same time she moved to Springfield and saw a need for a yoga studio.

Yoga wasn’t Karoun Charkoudian’s first career choice. In fact, she likes to say that yoga found her, not the other way around.
Her original plan was much different. She earned a bachelor’s degree in Geology at Johns Hopkins University in Baltimore and followed that with her master’s at the University of Wisconsin, then worked for five years with Exxon Mobil in Houston, all the while practicing yoga for her personal benefit.
“I was in my late 20s, and I came to a place where I decided that the corporate work world just wasn’t for me,” she told BusinessWest. “So I quit my job and just planned to take some time off.”
Having grown up in Newton, she returned to Massachusetts, where two things happened.
First was her deepening interest in yoga, as she filled her sudden free time with intensive trainings. “I basically experienced a really intense, deep spiritual calling at one of these trainings,” she said. “It was kind of a shift that happened inside me. After that, I felt like I had to reach out to people, help them find a better place in life, help them heal and re-energize their life through yoga.”
Soon after, Charkoudian moved to Springfield because it was more affordable than living in the Boston area, and came to realize that the city’s downtown had no yoga studios. And everything just clicked.
“I had found my passion and also found a city that needed it,” she said. “In Newton or Northampton there’s a yoga studio on every corner, but coming here, I felt like I found my calling. I knew it happened for a reason.”
She opened Karoun Yoga last year, and has already been thrilled with the effect her sessions have had on her growing clientele.
“One of my students — she comes to class regularly, and she loves it — actually carries an oxygen tank with her,” Charkoudian said. “One time, toward the end of the class, I could hear her turning down the oxygen level in her tank; she didn’t need as much oxygen anymore.
“Another guy came to my class with anxiety issues,” she continued. “He wrote me a beautiful testimony about how he was struggling and needed to take medication, though he really didn’t want to. But once he started taking my classes, he was able to apply these breathing techniques in his life, and now we can control the anxiety, where before, the anxiety controlled him.”
The stories don’t end there, and Charkoudian is gratified by all of them.
“I have a woman who has asthma taking some classes with me, and she felt different immediately in class; she had bigger breaths, deeper breaths, more controlled breathing,” she said. “Then I had a senior man with arthritis literally everywhere, to the point where he has trouble walking, and walks slowly and rigidly. When he left my class, his walk was completely different; he was walking faster, taller, more upright in general.
“I have people come in at the end of class saying, ‘wow, I feel so amazing. Thank you so much.’ It runs the gamut from totally healthy people to those with health issues. But the thing is, even a 25-year-old who is otherwise perfectly healthy can be under a lot of stress. So this is very much a preventative health measure.”
Coming into Focus
Yoga serves that function by teaching people, through controlled breathing, posture, and other methods, how to live mindfully.
“The definition of yoga is the union, or yoking, of the body and mind,” Charkoudian explained. Stress arises when people fail to live in and focus on the moment; instead, whether they’re driving, eating, or simply watching TV, their mind is racing and obsessing about work tasks or anything else that might be contributing pressure to their lives.
“That kind of stress, even if it’s background stress, can build and build, and it sits there because you’re not releasing it” — something at which yoga is particularly effective, she explained. “Yoga is a way for people to stop and have this little gift in their day, a gift of peace and silence. A lot of people don’t realize how badly they need that. They have no idea how stressed out they are.”
Perhaps most satisfying is this testimony from a Springfield teenager: “I realized I’ve been stressed out a lot lately,” she wrote. “Those breathing exercises come in handy when I wanted to give up.” That note followed an intensive, four-day seminar with 10 girls from the Springfield Renaissance School, which “showed me how stressed young people are, between school and family, and how much they need this. So I’m building awareness.”
And making people in Springfield more aware of yoga also means dispelling some of the anxiety they might have about it.
“A lot of people get scared when they hear the word yoga; they think of some sleek studio in Manhattan where everyone’s skinny and in good shape,” she said. “We don’t have that here. We get all shapes and sizes, men and women, many different ages and ethnicities.”
Charkoudian leads a host of different classes, some scheduled, some drop-in. Her studio is located on Pearl Street, close to the city’s nightclub district, but she also conducts lunchtime classes at the Sovereign Bank building downtown, and she’ll soon begin offering free classes in the South End sponsored by the Recovery Learning Community.
“A lot of people may benefit from yoga who can’t afford it,” she explained. For her other classes, students pay per session but can purchase a five-class card for a cheaper rate.
She says the discipline of yoga can benefit people in several ways, mentally and physically. One client, a private-lesson student, played basketball with friends often, and realized after he began practicing yoga that his on-court skills were improving. “He actually felt like his response time was better.”
That has to do with that element of mindfulness and focusing on the moment, and it has implications for sports performance; indeed, increasing numbers of professional athletes are discovering yoga. But it can bring similar benefits to any job, Charkoudian said.
“You’re more aware of yourself, whether you’re at work or just walking down the street in the morning,” she said. “You have more focus, more clarity.”

Breathing Easier
Despite her own focus on building a successful business, “it hasn’t been easy,” Charkoudian said. “It’s been up and down. But a lot of that is just yoga education. Many people here don’t know what yoga is about. They’ve never seen gentle yoga; they think it’s crazy acrobatics. In a place like Northampton, it’s part of the culture, but here, I feel I’m introducing it to the city, trying to touch people with yoga.”
For that reason, her classes tend to be of the gentle variety of Hatha yoga. A typical class begins with simple breathing exercises and gentle poses to warm up the body, Charkoudian said. That leads into a series of lunges or squats and flowing arm movements, followed by deeper stretching. Each session ends with five to 10 minutes of guided relaxation, as participants lie down on the mat and focus on breathing.
In keeping with her passion of bringing yoga to new audiences, Charkoudian is changing the structure of her enterprise somewhat.
While she has focused on open classes during her first year in business, she wants to work more with groups, through events like corporate seminars and yoga parties, all with the goal of showing people how to incorporate yoga into their daily lives.
“I want people to know that they don’t need mats and blocks; you can be sitting in your chair in your regular clothes, or standing beside your desk, doing very basic breathing and stretching exercises. I’m basically giving people a way to eliminate stress at any time. I call it their toolbelt; I’m giving people tools so they can deal with stress right now without having to go to a yoga studio.”
And when they do visit Karoun Yoga, she wants to make sure people can explore what yoga has to offer in a fun, non-intimidating way.
“I want people to understand the benefits of yoga, but also have fun with it,” Charkoudian said. “Yoga can get serious very quickly, and I can be very serious as well. But having fun while learning to deal with stress at the same time is a unique combination, and I think I can help more people that way.”
And teach them how to help themselves, no matter where they are.

Joseph Bednar can be reached at
[email protected]

Quite Contrary

By BusinessWest Staff June 7, 2010

Sr. Mary Caritas, Jackie Bolieau, and Sr. Joan Mullen

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Mary’s Meadow Touts an Innovative Small-home Model of Nursing Care

Sr. Mary Caritas, Jackie Bolieau, and Sr. Joan Mullen say Mary’s Meadow — with its spacious community areas, gardens, and central chapel — was designed to look and feel as little like a nursing home as possible.

Sr. Mary Caritas isn’t sure which feature of Mary’s Meadow its residents and patients like best, but there’s plenty to choose from.
“It’s a totally new model,” Caritas said. “We’re the first in Massachusetts — as a matter of fact, the first in New England — with a social model delivering skilled nursing care, as opposed to a medical model of rehabilitation.”
Specifically, the nursing home, carved into a former open meadow beside Providence Place in West Springfield, is built on a small-home concept, with four houses connected by a chapel, said Caritas, vice president of the Sisters of Providence Health System. Each of those houses features 10 rooms that, in turn, open onto a spacious common area and a kitchen.
“Here, patients have more say,” Caritas said. “They can get up when they feel like it, and have breakfast when they get up,” rather than having to adhere to a certain strict schedule. And because of the layout, “no one walks more than 25 feet from their room to get to an activity.”
In other words, it doesn’t feel like a nursing home. Gone is the nursing station central to a traditional skilled-nursing facility, replaced by medication and supply cabinets in each room; nurses visit each room to administer care.
Also jettisoned are long corridors, extensive off-limits areas, and a central bureaucracy calling the shots for all patients. Mary’s Meadow residents have full access to their house’s kitchen, outdoor garden, and other space, and individual house councils make decisions on menus, activities, and routines. Instead of strictly regimented staff, the ‘elder assistant’ who works in a house is a CNA who provides direct care, laundry, cooking, and housekeeping.
Since its opening last summer, Mary’s Meadow — now completely occupied — has brought plenty of excitement to the Sisters of Providence campus, Caritas said. But it started with a promise.

Coming Home
Mary’s Meadow was established partly to keep a promise to provide a home for sisters who were moved from Providence Place when it became an independent-living facility; they were temporarily housed on one floor of Providence Behavioral Health Hospital. The new facility’s name derives from the fact that all Sisters of Providence once took the name Mary.
And it’s appropriate that this facility, created to welcome the sisters home, is also helping patients return to their own homes. The small houses are designed for both long-term living and short-term rehabilitation, and the staff believes the homelike model is conducive to recovery.
“For our rehab patients, we’re finding that they’re rehabbing much quicker and returning home,” said Jackie Bolieau, admissions and marketing coordinator, a few minutes before patients gathered in the community area to perform exercises together. “Whether someone has a total hip or total knee replacement, or cardiac surgery, they can come here and rehab. What better place to do that than a homelike environment?”
“And their cognitive abilities are sustained much longer,” added Caritas, “because they tend to be with other people when they come out of their room. Instead of walking into a corridor, they immediately find other people; they find stimulation.”
Scientific evidence seems to back up that assertion, Caritas said, pointing to a study published in the Journal of the American Geriatrics Society suggesting that residents of small nursing homes are more satisfied with their care and report a better quality of life than residents of larger, traditional nursing homes.
The report cited higher quality-of-life measurements, such as meaningful activity and relationships; comfort and a sense of security; dignity, individuality, and privacy; and the enjoyment of food, according to one of the researchers, Rosalie Kane, a professor with the University of Minnesota’s School of Public Health in Minneapolis.
The study specifically examined the model featured at Mary’s Meadow: an interconnected community of four 10-resident homes. The survey suggested that such residents have a lower incidence of later decline in activities of daily living when compared with 40 randomly selected residents in each of two traditional nursing homes.
The researchers also found that quality of care in the small-house dwellings at least equaled that provided in the traditional nursing homes and that residents showed significantly higher satisfaction with the small-house nursing home as a place to live, and were as socially active as residents of traditional nursing-home residents.
Additionally, aides working in the small-house model “were much more confident that they could help their residents achieve better social and psychological outcomes, felt they knew the residents under their care better, and had much higher job satisfaction on a variety of measures and were more likely to remain in the job,” Kane told Reuters Health.
Writing in Long-Term Living magazine, Judith Rabig and Donald Rabig go so far as to suggest that the traditional model of care is an outdated relic.
“Traditional nursing-home staff have been organized in a 19th-century industrial model, with a steep bureaucracy, departmental structures, and disenfranchised direct-care workers receiving top-down communication,” they write. “Staff is viewed as interchangeable, and their satisfaction is secondary to efficiency and completed work quotas and schedules. Staff work is focused on satisfying residents’ physical and safety needs, with no time or institutional imperative directed at meeting their higher-level needs.
“A worker,” they continue, “is valued for the ability to meet work quotas and schedules. The result has been to create high levels of job dissatisfaction and high turnover, which in turn produce poor quality of care.”

Outside the Box
Yet, despite the evidence that the small-home concept works, they write, implementation of a different model is no easy task.
“It’s a very different environment for staff, who need to change their mindset to this new model,” Caritas said. “We find that, in hiring staff, it’s easier for people who have been in home care to adapt to what we’re doing, rather than people in a traditional nursing home.”
Sr. Joan Mullen, president of the development project, said the concept has been difficult for even regulators to grasp. “We had to get quite a few construction waivers” — 56 of them, to be accurate, she said. For instance, the corridors in a nursing home must be a certain width, but the rooms at Mary’s Meadow don’t open onto corridors at all, so Mary’s Meadow installed beams in the ceiling to mark where corridors would have gone.
Plenty of thought — and some very long meetings — have gone into the design and features of Mary’s Meadow, from computer access, electronic medical records, and a wireless call system to strategic uses of color. For example, the carpeting of each home is a different shade, and that color is reflected in the stained glass that borders each chapel door that leads to a different home, reducing the possibility of a resident losing his or he way.
Meanwhile, from the layout of the private bathrooms to the meals — eaten at a long dining table, as a family would, with opportunities for residents to help with preparation and cleanup — everything has been designed to make Mary’s Meadow look and feel nothing like a nursing home. And that’s the point.
“This is based on patient and staff empowerment,” Mullen said. And, as Caritas noted, the residents and short-term patients feel like they’re home — no matter what name they go by.

Joseph Bednar can be reached at
[email protected]

Caregiver Stress

By BusinessWest Staff June 7, 2010

Sections Supplements

It’s Real, and Its Impact Can Be Severe; How to Avoid the Epidemic

Gina Barry

‘I’m so stressed out!’ ‘I just can’t take it anymore!’
Certainly, almost all of us have made one, or both, of these proclamations in response to any number of events that have occurred in our lives. Take a moment now to think of how you felt during those moments, and you will get a glimpse into the daily lives of our nation’s family caregivers.
Approximately 44 million Americans (21% of the adult population) provide unpaid care to someone in need. While most people think that nursing homes provide the majority of long-term care, the U.S. Department of Health and Human Services estimates that informal caregivers actually provide 80% of the long-term care in the U.S. As our population continues to age, demands for care will steadily increase, and caregiver stress, unless recognized and remedied, will become even more pervasive.
A caregiver is anyone who helps another person in need with daily tasks, such as bathing, cooking, eating, taking medications, dressing, using the bathroom, shopping, housecleaning, and the like. Typically, the person receiving care has a medical condition that makes them unable to perform these tasks for themselves, or at least without some assistance. According to the U.S. Department of Health and Human Services, 61% of our nation’s caregivers are women. Our nation’s caregivers are mostly middle-aged, with 13% of caregivers being 65 years old or older.
Caregiver stress is real, and its impact can be severe. A spousal caregiver over the age of 65, who is experiencing ongoing mental or emotional stress as a result of providing care, has a greatly increased risk of dying over those people in the same age group who are not caring for a spouse. Providing care is physically and emotionally demanding, especially when the care recipient requires 24-hour care. Very often, the caregiving spouse neglects his or her own health issues, which are usually compounded by stress, because he or she is too busy addressing the care needs of the spouse. When an adult child is the caregiver, the caregiver generally experiences additional stress, as they have other responsibilities outside of caregiving, such as providing care for young children, running their own household, managing their professional life, and maintaining a busy social life.
Many caregivers provide care without realizing the impact of caregiver stress. Obvious physical signs of stress include, but certainly are not limited to, fatigue; high blood pressure; irregular heartbeat or palpitations; chest pain; back, shoulder, or neck pain; frequent headaches; digestive problems; and hair loss. Caregivers experiencing sustained stress may also exhibit a weakened immune system, which means they will be more susceptible to colds, flu, and other infections. As the majority of these signs are not open and obvious, it is important for a caregiver to be self-aware. It is also important that the caregiver be asked whether they are experiencing any of these signs.
Emotional signs of stress are usually not easily observed. These signs include a gamut of feelings, including but not limited to anxiety, depression, irritability, frustration, lack of control, and isolation. A stressed caregiver may also report or exhibit mood swings, memory problems, and/or general unhappiness with their position as a caregiver, including resentment toward the care recipient and family members who do not contribute in any meaningful way.
Additional signs of caregiver stress may be observed. The caregiver may be missing meals or eating an unhealthy diet for a period of time, such that their weight either increases or decreases dramatically. An overwhelmed caregiver will often miss or delay their appointments, whether medical or social, as they often give up their ‘me’ time. They will stop engaging in their usual activities and often lose connections with friends and family. Further, they may stifle feelings of anger and frustration, which then surface as angry outbursts directed at family, friends, co-workers, or even strangers. Overall, they may seem sad, depressed, or hopeless, and show a loss of energy.
Most often, caregivers have difficulty asking for help. Either they do not recognize the stress they are under, or they are so stressed that they feel hopeless as to help being available. Caregivers will also often express feelings of extreme guilt associated with asking someone else to provide care in their stead, even if only for a short period of time. In this regard, it is very important for the family and friends of caregivers to encourage regular respite for the caregiver and to ensure that the caregiver takes these regular breaks from caregiving. Respite can be provided in home or at a facility and may take the form of day care or involve a short stay at the facility.
In addition to regular respite, there are many ways that caregivers can reduce their stress. First and foremost, it is important for caregivers to learn about programs that are available to assist with caregiving and how to qualify for such assistance. There are a variety of programs available, including meal delivery, home health care, day care, transportation, and the like. When assistance is available through these programs, clearly it is important to accept the help offered. When a family member or friend offers to help, the caregiver should offer a list of ways to help, while allowing the friend or family member to choose what they would be most comfortable doing.
A caregiver should objectively look at the care they are providing and determine whether it may be done more efficiently. For example, it would likely be preferable to purchase a new washing machine and dryer than to continue to use a public laundromat. It may be worthwhile to obtain an emergency-response system that would allow the person being cared for to summon help if needed. Likewise, an intercom system or even a Web camera can allow for remote monitoring of the person requiring care. Finally, for dementia patients who wander, a mobility monitor may be employed that will sound an alert if the person being cared for wanders outside of a previously set range. In addition, the caregiver should prioritize tasks, use lists, and establish a daily routine with realistic goals. A caregiver should also be careful not to take on additional projects, such as hosting a holiday meal or agreeing to help with a remodeling project.
Actively taking care of their own emotional health is a must for caregivers. Some caregivers find individual counseling to be helpful for dealing with the variety of emotions that caregiving evokes. Many different support groups also exist, some of which are specific to the illness being suffered by the person in need of care.
Support groups are great for developing friendships with other caregivers and also for caregivers to learn improved ways to provide care or to cope with the difficulties they experience when providing care. It is also vital for a caregiver to remain in touch with family and friends — or for family and friends of the caregiver to make sure that they stay in touch.
Moreover, a caregiver should be sure to include some fun in their weekly schedule. Taking in a movie, going for a walk, or meeting a friend for coffee and conversation can be delightful distractions from caregiving stresses. Although some may not consider this fun, a caregiver should be sure to get regular exercise. Exercise provides stress relief and has a positive effect on mood. In addition, the caregiver should plan healthy meals and adhere to a sleep schedule that ensures they will receive adequate, ongoing rest.
When a caregiver is cognizant of the signs of caregiver stress and actively works to combat this stress, he or she will be much better able to provide care and for a much longer period of time. Whenever possible, the caregiver should not be alone in this endeavor. Family and friends should also be sure to support the caregiver and to be on the lookout for any signs of stress.
With the continued graying of our nation and the anticipated increase in caregiving by family members, if we do not adhere to these practices, our nation’s next disabling epidemic will likely be caregiver stress.

Gina M. Barry is a partner with the law firm Bacon Wilson, P.C. She is a member of the National Assoc. of Elder Law Attorneys, the Estate Planning Council, and the Western Mass. Elder Care Professionals Assoc. She concentrates her practice in the areas of estate and asset-protection planning, probate administration and litigation, guardianships, conservatorships, and
residential real estate; (413) 781-0560; [email protected]

Designs on Success

By BusinessWest Staff May 24, 2010

Sections Supplements

A chart of area architecture firms

Architecture Firms BW5.10b

What Bonding Companies Find Important

By BusinessWest Staff May 24, 2010

Sections Supplements

You Don’t Need a Crystal Ball to Figure Out What They’re Thinking

Joseph Spagnoletti

Construction companies need the support of their bonding company to sustain the growth of their business. As a result of the current economic realities of the construction industry, bonding companies are spending more time scrutinizing the viability of their clients’ financial future and operations before issuing a bond.
Here are the 10 topics you need to be prepared to address the next time you sit down with your surety agent.

1. Banking covenants. Bonding companies want to know that you are satisfying the covenants as outlined in your loan or line of credit documents. If you’re not meeting the covenants, you need to talk to your banker about rewriting the covenants or developing a strategy for meeting them. Bonding companies get concerned when they see that construction companies are not meeting their banking covenants.
In fact, this could result in an immediate end to a line of credit or an immediate call for repayment of a loan. Needless to say, without access to financing, some construction companies couldn’t afford to complete their work in progress. In the end, bonding companies want to see a positive working relationship with your lending institution.

2. Accounts receivable. Your accounts-receivable aging report will be examined throughout the year. What are bonding companies looking for? They want to make sure that you’re being paid for your work, and you have business systems, policies, and procedures in place to track and encourage timely payments. Before starting work for a customer, perform enough due diligence that would lead you and your bonding company to believe you’ll get paid for your work.

3. Accounts payable. Pay your bills in a timely fashion. Bonding companies assume that, if you’re not paying your bills in a timely fashion, you either don’t have the resources to do so, or you have weak internal business systems. Either way, that’s bad news.

4. Backlog. In construction, it’s all about the backlog. Really, whether you are an accounting firm, law office, or a construction company, a backlog of work secures the future of your business. The longer the backlog, the more confidence bonding companies will have in your business, and the more likely they are to insure the completion of your work. Keep in mind that bonding companies will look at more than the total number of jobs backlogged; they’ll look for the number of profitable jobs.

5. Strategic business plan. We all get distracted by today’s challenges, but taking the time to write a strategic business plan is good for the future of your business. And that’s just what bonding companies are concerned about — the future of your business. What are your short-term, mid-range and long-term goals, and what is your strategy for achieving them? Write them down. A good strategic business plan includes timelines and benchmarks to measure progress. If your bonding company comes in for a visit and asks to see your strategic business plan, be ready to share a thoroughly prepared document.

6. Profitable and cost-controlled work. Your bonding company wants to know that your jobs are profitable and that costs can be controlled as shifts in the market demand. So be prepared to show how you plan to profit from your work and control costs. In addition, if market conditions change, you need to have a plan in place to adjust. Take a proactive approach to challenges by implementing smart solutions on a timely basis.

7. Equipment. Equipment represents a major investment for most construction companies. The patterns of acquisition and disposition of equipment tell the bonding company a story. Be ready to discuss the reasons why you are either acquiring or disposing of equipment. If you’re stuck supporting debt for idle equipment, there may be creative ideas you could explore to turn idle equipment into a revenue source. Discuss strategies like this with your surety agent.

8. Loans from owners. As an owner of any business, when times are tough, you may have to loan your company money to help it through a temporarily challenging time. Don’t be surprised if loans you make to your company get subordinated to other obligations of the company and require approval from your surety before you get paid back. As an aside, be sure to consult with your accountant and attorney before loaning money to your company; there may be tax benefits or implications that deserve additional discussion.

9. Indemnity. Personal and spousal indemnity is becoming commonplace, especially if your surety agent considers a particular job to be a stretch for your company. Your bonding company sees more risk associated when you do work outside of your areas of expertise. With additional risk comes additional indemnity. If this sounds like you, be prepared to discuss why your company can meet its obligations even outside its areas of expertise.

10. Unexpected taxes. If your construction company (structured as a C-corporation) has adopted the completed contract basis of accounting for tax purposes, you may not be in a position to defer taxes to next year without a sizeable backlog. As backlogs at some construction companies aren’t so large, this could mean that those deferred taxes are payable now. Unanticipated, this could place significant strain on cash flow. Even if your deferred tax is at the individual level, as is the case with a flow-through entity, be prepared to discuss this issue with your surety agent.

Surety agents can be supportive in helping you grow your construction business. That being said, in higher-risk environments, they’ll need additional and more detailed information about you and your business.
Take a proactive approach in developing a positive working relationship with your surety agent. Get together throughout the year. Share your success stories and your challenges. Tell your surety agent what your company is doing to improve business processes and procedures, and what strategies you’ve put into place to control costs and become more profitable. When you and your surety agent are on the same page, that’s good for business.

Joseph Spagnoletti, CPA, CCIFP is partner in charge of the Construction Services Group at Kostin, Ruffkess & Co., LLC, a certified public-accounting and business-advisory firm with offices in Springfield as well as Farmington and New London, Conn. Beyond traditional accounting, auditing, and tax consulting, the firm also specializes in employee benefit-plan audits, litigation support, business valuation, succession-planning business consulting, forensic accounting, wealth management, estate planning, fraud prevention, and information technology assurance; www.kostin.com.

For Sale, for Lease

By BusinessWest Staff May 24, 2010

Sections Supplements

A list of area commercial properties on the market

Commercial Real Estate BW5.10b

Hot and Cold

By BusinessWest Staff May 24, 2010

Sections Supplements

A list of companies providing HVAC services

HVAC services BW5.10b

Small-business Owners and Health Care

By BusinessWest Staff May 10, 2010

Sections Supplements

Recently Enacted Legislation Has Provisions That Impact the Bottom Line

Kristina Drzal Houghton

For owners of small businesses and their workers, the recently enacted health-reform legislation has some key provisions to pay attention to. The major ones include tax credits, excise taxes, and penalties.
But whether a business will be affected by them depends on a variety of factors, such as the number of employees the business has. This article explains how the health care legislation impacts a small business in each of these areas.

Tax credits to certain small employers that provide insurance. The new law provides small employers with a tax credit (i.e., a dollar-for-dollar reduction in tax) for non-elective contributions to purchase health insurance for their employees. The credit can offset an employer’s regular tax or its alternative minimum tax (AMT) liability.

Small-business employers eligible for the credit. To qualify, a business must offer health insurance to its employees as part of its compensation and contribute at least half the total premium cost. The business must have no more than 25 full-time-equivalent employees (FTEs), and the employees must have annual full-time equivalent wages that average no more than $50,000. However, the full amount of the credit is available only to an employer with 10 or fewer FTEs and whose employees have average annual full-time equivalent wages from the employer of less than $25,000.

Years the credit is available. The credit is initially available for any tax year beginning in 2010, 2011, 2012, or 2013. Qualifying health insurance for claiming the credit for this first phase of the credit is health-insurance coverage purchased from an insurance company licensed under state law. For tax years beginning after 2013, the credit is available only to an eligible small employer that purchases health-insurance coverage for its employees through a state exchange, and is only available for two years. The maximum two-year coverage period does not take into account any tax years beginning in years before 2014. Thus, an eligible small employer could potentially qualify for this credit for six tax years, four years under the first phase and two years under the second phase.

Calculating the amount of the credit. For tax years beginning in 2010, 2011, 2012, or 2013, the credit is generally 35% (50% for tax years beginning after 2013) of the employer’s non-elective contributions toward the employees’ health-insurance premiums. The credit phases out as firm size and average wages increase.

Special rules. The employer is entitled to an ordinary and necessary business-expense deduction equal to the amount of the employer contribution minus the dollar amount of the credit. For example, if an eligible small employer pays 100% of the cost of its employees’ health insurance coverage and the amount of the tax credit is 50% of that cost (i.e., in tax years beginning after 2013), the employer can claim a deduction for the other 50% of the premium cost.

Self-employed individuals, including partners and sole proprietors, 2% shareholders of an S corporation, and 5% owners of the employer are not treated as employees for purposes of this credit. There is also a special rule to prevent sole proprietorships from receiving the credit for the owner and their family members. Thus, no credit is available for any contribution to the purchase of health insurance for these individuals, and the individual is not taken into account in determining the number of full-time equivalent employees or average full-time equivalent wages.

Most small businesses are exempted from penalties for not offering coverage to their employees. Although the new law imposes penalties on certain businesses for not providing coverage to their employees (so-called ‘pay or play’), most small businesses won’t have to worry about this provision because employers with fewer than 50 employees aren’t subject to the pay-or-play penalty. For businesses with at least 50 employees, the possible penalties vary depending on whether or not the employer offers health insurance to its employees. If it does not offer coverage and it has at least one full-time employee who receives a premium tax credit, the business will be assessed a fee of $2,000 per full-time employee, excluding the first 30 employees from the assessment.
So, for example, an employer with 51 employees who doesn’t offer health insurance to his employees will be subject to a penalty of $42,000 ($2,000 multiplied by 21). Employers with at least 50 employees that offer coverage but have at least one full-time employee receiving a premium tax credit will pay $3,000 for each employee receiving a premium credit (capped at the amount of the penalty that the employer would have been assessed for a failure to provide coverage, or $2,000 multiplied by the number of its full-time employees in excess of 30). These provisions take effect Jan. 1, 2014.

The ‘Cadillac tax’ on high-cost health plans. The new law places an excise tax on high-cost, employer-sponsored health coverage (often referred to as ‘Cadillac health plans’). This is a 40% excise tax on insurance companies, based on premiums that exceed certain amounts. The tax is not on employers themselves unless they are self-funded (this typically occurs at larger firms). However, it is expected that employers and workers will ultimately bear this tax in the form of higher premiums passed on by insurers.
Here are the specifics. The new tax, which applies for tax years beginning after Dec. 31, 2017, places a 40% non-deductible excise tax on insurance companies and plan administrators for any health coverage plan to the extent that the annual premium exceeds $10,200 for single coverage and $27,500 for family coverage. An additional threshold amount of $1,650 for single coverage and $3,450 for family coverage will apply for retired individuals age 55 and older and for plans that cover employees engaged in high-risk professions.
The tax will apply to self-insured plans and plans sold in the group market, but not to plans sold in the individual market (except for coverage eligible for the deduction for self-employed individuals). Standalone dental and vision plans will be disregarded in applying the tax. The dollar-amount thresholds will be automatically increased if the inflation rate for group medical premiums between 2010 and 2018 is higher than projected. Employers with age and gender demographics that result in higher premiums could value the coverage provided to employees using the rates that would apply using a national risk pool.
The excise tax will be levied at the insurer level. Employers will be required to aggregate the coverage subject to the limit and issue information returns for insurers indicating the amount subject to the excise tax.

Kristina Drzal Houghton, CPA, MST, is partner-in-charge of Taxation at Meyers Brothers Kalicka, P.C. in Holyoke; (413) 536-8510.

Something to Pay Attention To

By BusinessWest Staff May 10, 2010

Sections Supplements

Department of Labor Is Viewing Most Internships as Employment Arrangements

Amy Royal

With the summer months approaching and the economy still in a slump, many area businesses are likely to be flooded with the résumés of high-school and college students seeking internships. Before taking action on any of these résumés, it is important for businesses first to be aware that many internships must be paid.
The idea of a paid internship may seem like an oxymoron since the word ‘intern’ usually connotes an unpaid arrangement. Indeed, internships are generally thought of as unpaid, mutually beneficial arrangements: the intern gains valuable work experience that will undoubtedly be included on her résumé, and the business gains free labor for the summer, labor that will undoubtedly answer the telephone, file, copy, and perform other miscellaneous tasks. But for the purposes of wage-and-hour laws, our traditional notion of what an internship should be is irrelevant.
The Fair Labor Standards Act (FLSA), which is the federal law requiring the payment of minimum wages and overtime compensation, generally prohibits unpaid internships, especially in the private, for-profit sector. Unpaid internships in the public sector and at nonprofit, charitable organizations, where the interns volunteer without the expectation of compensation, are usually permissible. Yet, at for-profit companies, the FLSA by and large requires that interns be paid at least the minimum wage as well as any overtime compensation for hours worked above 40 in a given week. In other words, under the FLSA, interns will oftentimes be treated as employees and must be compensated for all hours worked.
Just in time for the summer months, the U.S. Department of Labor’s Wage and Hour Division, which is the federal agency with enforcement authority over wage-and-hour laws, appears to be cracking down on unpaid internships. In fact, just last month, the DOL published a fact sheet on its Web site, titled “Internship Programs Under the Fair Labor Standards Act,” which makes it clear that the DOL will view most internships as an employment arrangement requiring compensation.
Although the fact sheet reiterates the FLSA’s implied mandate that internships be paid, it sets forth a six-part test for determining the circumstances under which an internship can be unpaid. As the fact sheet is quick to point out, these circumstances are very narrow, and the determination of whether an internship meets this narrow exception depends upon all of the facts and circumstances of each internship program, including the following six factors:
• The internship, even though it includes actual operation of the facilities of the employer, is similar to training, which would be given in an educational environment;
• The internship experience is for the benefit of the intern;
• The intern does not displace regular employees, but works under close supervision of existing staff;
• The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded;
• The intern is not necessarily entitled to a job at the conclusion of the internship; and
• The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.
If each of the above factors is met, then an employment arrangement does not exist under the FLSA, and, as a result, the FLSA’s minimum wage and overtime provisions do not apply. Under the DOL fact sheet, an intern will be considered an employee if she is engaged in any business operations or is performing any productive work for the business, such as filing, copying, answering telephones, or other clerical work or assisting customers. Additionally, if an intern is placed with a business for a trial period with the expectation that she will be hired on a permanent basis at some later date, that intern will also be considered an employee, entitled to minimum-wage and overtime compensation.
The fact that an intern may be receiving some benefit in the form of a new skill, work experience, or better work habits in the course of their internship is irrelevant and will not exclude them from the FLSA’s minimum-wage and overtime requirements. In fact, meeting each of the six exclusion factors will be very difficult, and the DOL, given its ramped-up enforcement efforts, is likely to be highly skeptical of businesses that do not pay their interns, scrutinizing them very closely.
Educational internship programs are generally exempt from the FLSA’s minimum-wage and overtime requirements. Indeed, the more the internship is structured around an educational program, the more likely it will be considered an unpaid arrangement. Usually, this occurs when a college or university oversees the internship program and provides credit for participation in the internship. Even then, the intern cannot be performing any services that would benefit the business. If the intern does, the internship arrangement will come within the FLSA’s protections.
Before taking on any interns this summer, businesses should carefully examine the nature of the work the intern will be doing. Bear in mind that any tasks that benefit the business, such as filing or copying, entitle an intern to compensation of at least minimum wage and overtime pay, when applicable. Businesses that erroneously label an individual an intern violate the minimum-wage and overtime laws, and can face severe penalties.

Amy B. Royal, Esq. specializes exclusively in management-side labor and employment law at Royal & Klimczuk, LLC, a women-owned, boutique, management-side labor and employment law firm; (413) 586-2288.

The Nuts and Bolts of the Problem

By BusinessWest Staff May 10, 2010

Sections Supplements

John Ratzenberger Brings His Summer-camp Initiative to STCC

John Ratzenberger

John Ratzenberger says that, when he speaks to groups of manufacturers, which he does often, he likes to hang around after the microphone is shut off and listen to what his audience members have to say.
And he’s generally alarmed by what he hears.
Such was the case at a recent gathering of machining company executives in Chicago, where Ratzenberger, best known to most as Cliff, the postal carrier he portrayed for more than a decade on Cheers, spoke about the perilous state of the sector, which he says is seriously threatened because young people don’t want to get into it anymore.
“I stayed and talked to some of the people there,” he told BusinessWest in a phone interview from his hotel room in the Windy City. “Every single one of them was worried — really worried. I was talking to one guy with an aircraft-manufacturing company who said most kids coming out of high school can’t even read a simple ruler. You ask them to find 3/4 of an inch, and most can’t do it.”
Beyond their lack of ruler-reading skills, most young people simply don’t have an appreciation for how to make things, or, equally important, how making things can be an attractive career, said Ratzenberger, who has made enlightening them a passionate endeavor for the last seven years or so.
His vehicle for getting the word out is an organization he founded called Nuts, Bolts & Thingamajigs, or NBT. That agency is now partnering with the Foundation of the Fabricators & Manufacturers Assoc. Intl. and the National Assoc. for Community College Entrepreneurship to develop a national program that builds on a summer-camp initiative blueprinted by NBT.
At 16 community colleges nationwide, including Springfield Technical Community College, students at week-long summer camps will be exposed to math, science, engineering, and entrepreneurship principles, while having an opportunity to see the technology being used in industry today.
“Those shop classes that high schools had years ago … they’re gone, a thing of the past,” said Ratzenberger. “These camps will do what those shop classes used to; they’ll expose young people to vocational and technical trades. Many young people today have no role models when it comes to fixing things themselves or taking pride in building something useful, and they dismiss the idea of considering a career in one of the manual arts such as manufacturing, electrical, plumbing, carpentry, or welding.”
Ratzenberger will be in the Springfield area for a few days in May to promote NBT and, more specifically, the summer-camp program. He has a few speaking engagements booked, including one before the local chapter of the National Tooling & Machining Assoc. on May 12 at the Springfield History Museum.

Trade Partners
The community colleges hosting manufacturing camps this summer are located in such places as Blue Bell, Pa., Marysville, Calif., Tupelo, Miss., Fergas Falls, Minn., and Appleton, Wis. That geographic coverage helps explain that the pending shortage of people who can build things with their hands is truly national, said Ratzenberger, noting also that time is of the essence.
“In four years, this is a problem that everyone will be talking about,” he told BusinessWest. “And in six years … well, by then it will be too late.”
This is the consensus opinion he’s gathered from those talks with manufacturers after his speeches about NBT and its mission. Ratzenberger said the problem has been building for some time now, and there are many reasons for it.
They range from negative portrayals of craftspeople in movies and television — “see a plumber on TV and he’s always portrayed as a simpleton, a loser,” said Ratzenberger — to parents and guidance counselors who are steering people away from the trades and toward a college education, whether they’re suited for one or not.
“So with all that happening, why would anyone want to explore those fields?” he asked before answering his own question. “It’s simple: they’re not.”
The summer camps are designed to do what the old shop classes did, and that’s at least enlighten young people about the trades and inform them about career opportunities, said Ratzenberger. “They’ll learn what it’s like to weld, bend metal, punch holes in metal, and more,” he said. “And we need to do that, because we’re simply running out of people who can do those things.”
And the prospects for filling the voids created by retiring machinists and craftspeople don’t look positive, and won’t until some perceptions about this sector change, he said.
Citing a recent poll conducted by NBT, Ratzenberger said that a majority of teens (52%) have little or no interest in a manufacturing career, and another 21% are ambivalent. When asked why, nearly two-thirds of respondents said they seek a professional career, while others cited issues such as compensation, career growth, and physical work, or a desire to avoid it.
“It’s absolutely critical for this mindset to change because, when America recovers from its economic downturn, there will be a dire need for skilled manpower in the trades,” he continued. “Numerous surveys conducted by the manufacturing organizations predict a labor shortage if we don’t inform the nation’s youth about the available opportunities and enlist them to fill the sophisticated, high-tech jobs available in areas such as robotics and laser technologies.”
The summer camp at STCC, to be called “Manufacturing Your Future,” is designed to do just that and, in the process, help in the process of putting more people in the pipeline, said Adrienne Smith, dean of the School of Engineering Technologies at the college. She said participants, 13- and 14-year-old technology students from area schools, will use technology to create a product from start to finish, providing them practical manufacturing experience in 3D design, computer numerical control programming, welding, and other applications.
Meanwhile, students will also visit area manufacturers to get an up-close look at manufacturing processes, new technology, and, perhaps most importantly, the people doing such work.
Overall, she said, the camps are designed to enlighten, inform, and ultimately change some of the attitudes that young people and their parents have about manufacturing.

Something to Build On
When asked if he could quantify or qualify how much progress NBT has made with fueling interest in the trades since it was formed, Ratzenberger paused and then said it would be difficult to do so.
The anecdotal evidence, such as that provided by the manufacturing executives he spoke to in Chicago, would seem to indicate that, however much progress has been achieved, there is still a lot of work to be done.
The planned summer camps won’t solve the problem, but they may help move an industry closer to a solution — and enable more young people to read a ruler.

George O’Brien can be reached at [email protected]

The A List

By BusinessWest Staff May 10, 2010

Sections Supplements

A chart of area advertising and marketing firms

Advertising Marketing Firms BW5.10a

Diversity in the Workplace

By BusinessWest Staff May 10, 2010

Sections Supplements

How Best to Develop a Corporate Strategy That Generates Results

As you look around your office, is everyone just like you? Probably not.
The demographics of the American workforce have changed dramatically over the past 50 years. In the 1950s, more than 60% of the American workforce consisted of white males. They were typically the sole breadwinners in the household, expected to retire by age 65 and spend their retirement years in leisure activities. Today, the American workforce is a better reflection of the population, with a significant mix of genders, race, religion, age, and other background factors.
The long-term success of any business calls for a diverse body of talent that can bring fresh ideas, perspectives, and views to their work. The challenge that diversity poses, therefore, is enabling your managers to capitalize on the mixture of genders, cultural backgrounds, ages, and lifestyles to respond to business opportunities more rapidly and creatively.
Diversity is no longer just a black/white, male/female, old/young issue. It is much more complicated and interesting than that. In The Future of Diversity and the Work Ahead of Us, Harris Sussman says, “diversity is about our relatedness, our connectedness, our interactions, where the lines cross. Diversity is many things — a bridge between organizational life and the reality of people’s lives, building corporate capability, the framework for interrelationships between people, a learning exchange, a strategic lens on the world.”
A benefit of a diverse workforce is the ability to tap into the many talents which employees from different backgrounds, perspectives, abilities, and disabilities bring to the workplace. An impressive example of this is found on the business cards of employees at one Fortune 100 technology company. Employees at this company have business cards that appear normal at first glance. On closer inspection, the raised Braille characters of employee information are evident.
Many companies, however, still face challenges around building a diverse environment. Part of the reason is the tendency to pigeonhole employees, placing them in a certain silo based on their diversity profile. If an employee is male, over 50, English, and an atheist, under what diversity category does this employee fall? Gender, generational, global, or religious? In the real world, diversity cannot be easily categorized, and those organizations that respond to human complexity by leveraging the talents of a broad workforce will be the most effective in growing their businesses and their customer base.
So, how do you develop a diversity strategy that gets results? The companies with the most effective diversity programs take a holistic approach to diversity by following these guidelines:

Link diversity to the bottom line. When exploring ways to increase corporate profits, look to new markets or to partnering with your clients more strategically. Consider how a diverse workforce will enable your company to meet those goals. Think outside the box. At a Fortune 500 manufacturing company, Hispanics purchased many of the products. When the company hired a director of Hispanic markets, profits increased dramatically in less than one year because of the targeted marketing efforts. Your new customers may be people with disabilities or people over the age of 65. How can your employees help you reach new markets?

Walk the talk. If senior management advocates a diverse workforce, make diversity evident at all organizational levels. If you don’t, some employees will quickly conclude that there is no future for them in your company. Don’t be afraid to use words like black, white, gay, and lesbian. Show respect for diversity issues and promote clear and positive responses to them. How can you demonstrate your company’s commitment to diversity?

Broaden your efforts. Does diversity at your company refer only to race and gender? If so, expand your definition and your diversity efforts. As Baby Boomers age and more minorities enter the workplace, the shift in demographics means that managing a multigenerational and multicultural workforce will become a business norm. Also, there is a wealth of specialized equipment available to enable people with disabilities to contribute successfully to their work environments. If your organizational environment does not support diversity broadly, you risk losing talent to your competitors. How can your recruitment efforts reach out to all qualified candidates?

Remove artificial barriers to success. The style of interview — behavioral or functional — may be a disadvantage to some job candidates. Older employees, for example, are less familiar with behavioral interviews and may not perform as well unless your recruiters directly ask for the kind of experiences they are looking for. Employees from countries outside the U.S. and non-Caucasian populations may downplay their achievements or focus on describing, who they know rather than what they know. Train your recruiters to understand the cultural components of interviews. How can your human-resources processes give equal opportunity to all people?

Retain diversity at all levels. The definition of diversity goes beyond race and gender to encompass lifestyle issues. Programs that address work and family issues — alternative work schedules and child and elder care resources and referrals — make good business sense. How can you keep valuable employees?

Provide practical training. Using relevant examples to teach small groups of people how to resolve conflicts and value diverse opinions helps companies far more than large, abstract diversity lectures. Training needs to emphasize the importance of diverse ideas as well. Workers care more about whether or not their boss seems to value their ideas than whether they are part of a group of all white males or an ethnically diverse workforce. In addition, train leaders to move beyond their own cultural frame of reference to recognize and take full advantage of the productivity potential inherent in a diverse population. How can you provide diversity training at your company?

Mentor with others at your company whom you do not know well. Involve your managers in a mentoring program to coach and provide feedback to employees who are different from them. Some of your most influential mentors can be people with whom you have little in common. Find someone who doesn’t look just like you. Find someone from a different background, a different race, or a different gender. Find someone who thinks differently than you do. How can you find a mentor who is different from you?

Measure your results. Conduct regular organizational assessments on issues like pay, benefits, work environment, management, and promotional opportunities to assess your progress over the long term. Keep doing what is working, and stop doing what is not working. How do you measure the impact of diversity initiatives at your organization?

In the book Beyond Race and Gender, R. Roosevelt Thomas defines managing diversity as “a comprehensive managerial process for developing an environment that works for all employees.” Successful strategic diversity programs also lead to increased profits and lowered expenses.
The long-term success of any business calls for a diverse body of talent that can bring fresh ideas, perspectives and views and a corporate mindset that values those views. It’s also no secret that the lack of diversity can affect your ability to communicate effectively with diverse clients.
Link your diversity strategies to specific goals like morale, retention, performance, and the bottom line. Build your business with everything you’ve got, with the complex, multi-dimensional talents and personalities of your workforce, and make diversity work for you.

Judith Lindenberger, principal of the Lindenberger Group, LLC, and Marian Stoltz-Loike, CEO of SeniorThinking, provide human-resources learning and consulting; www.lindenbergergroup.com; www.seniorthinking.com

Case in Point

By BusinessWest Staff May 5, 2010

Sections Supplements

A list of law firms in Western Mass.
Law Firms BW5.10a

Highlight Show

By BusinessWest Staff April 26, 2010

Sections Supplements

Dynamic Keynoters, Networking Event on Tap for Market Show 2010

ACCGS President Russell Denver says a down economy is not a reason to stay on the sidelines for a big trade show like the Market event slated for May 5 at the MassMutual Center.

In fact, these are the times when companies should be front and center, he told BusinessWest, adding that a show like Market gives businesses a chance to differentiate themselves from the competition and put their products and services not to mention their perseverance in the face of tough conditions on display.

The show will provide an opportunity for companies to show theyre not only surviving, theyre thriving, he said. And it can give them an edge that companies not exhibiting wont have; when others are pulling back, theyll be standing out and differentiating themselves.

Trade shows remain a comparatively low-cost way to effectively market a company, he continued, adding that participating companies can put their name and services in front of hundreds of other exhibitors and visitors.

Despite this reasoning, Denver knows that some business owners will need some additional incentives to invest the time, energy, and money needed to participate in the 2010 Business Market Show. So he and others at the Affiliated Chambers are providing them.

Were upping the ante, said Denver, who used that phrase to characterize everything from the speakers at breakfast and lunch to the Cinco de Mayo Networking After Hours Event.

Concerning the former, the lineup consists of breakfast keynote speaker Jeff Taylor, founder of Monster.com, while at lunch (which will have a separate fee), Charlie Baker, Republican candidate for governor and former CEO of Harvard Pilgrim Health Care, will take to the podium.

Weve always had dynamic, informative speakers, but were very excited about this years keynoters, said Denver. Jeff Taylor has an incredible story to tell, one that inspires all small-business owners, and with the passage of health care reform legislation, there should be a lot of interest in what Charlie Baker has to say, and many questions as well.

As for the networking event, it will be a blend of the long-running Taste of the Market event that has wrapped up the last several market shows and the Affiliated Chambers monthly After 5 networking programs, said Diane Swanson, events manager for the ACCGS.

Area restaurants and caterers are still being lined up for the day-capping event, said Swanson, which will have a festive, Cinco de Mayo flavor to it, and should keep many attendees at the Market show through the afternoon, while spurring some later arrivals as well.

Overall, sales for the show have been solid, said Swanson, noting that they are down slightly from previous years, an obvious result of the still-sluggish economy, but should approach the 200-booth level, which is the traditional goal for the Market show.

Attendees will find a number of value-added elements to the show, Swanson continued, adding that, for the fourth consective year, DiGrigoli Salons will be offering free haircuts, and there will be several giveaways. Meanwhile, there are two morning seminars:

From 10 to 10:45 a.m. in Room 1 will be a program titled 2010 and the Roth IRA Conversion Opportunity. Speakers will be David Veale, senior vice president, AXA Equitable; John L. Carty, CRPS, vice president and financial advisor, Morgan Stanley Smith Barney; and Patrick Willcutts, CFP, CIMA, vice president and financial advisor, Morgan Stanley Smith Barney.

And from 11 to 11:45 a.m. in Room 2 will be a program titled Social Networking and the Workplace: a Discussion of the Business and Legal Issues Arising Out of Employees Use of Facebook, Linkedln, Twitter, and Other Social Networking Applications. The speaker will be Kimberly A. Klimczuk, Esq., a partner with Northampton-based Royal & Klimczuk, LLC.

There is still plenty of time to become part of the trade show, said Swanson. To register, or for more information, call (413) 755-1313 begin_of_the_skype_highlighting (413) 755-1313 end_of_the_skype_highlighting, or e-mail[email protected].

Return to Lender?

By BusinessWest Staff April 26, 2010

Sections Supplements

Commercial-loan Market Remains Sluggish

Commercial Loan Market

The financial meltdown of 2008 and the recession that followed in its wake were a double punch to commercial lending nationally, as banks tightened up credit and businesses of all types retreated from capital investments. In Western Mass., banks say they still have plenty of money to lend, but demand is still stubbornly low as companies remain uncertain about their own growth. Overall, the picture is improving … but slowly.

Almost two years ago, the worldwide financial-services industry was rocked by a credit crisis that left many large, national banks reeling and awash in toxic assets.

The repercussions of that meltdown hit a faltering economy hard and contributed to whats become known as the Great Recession and also to a tightening of credit across the board, as banks that had facilitated reckless loans over the past decade focused on digging out from the wreckage. Meanwhile, the recession caused businesses in all industries to back off from further borrowing and capital investment.

Almost two years later, by many accounts, the economy may have hit bottom and started to rebound (see related story, page 6). But are banks still willing to open the commercial-loan window? And are businesses actively seeking those loans?

Yes and no, said Paul Scully, CEO of Country Bank. We are totally prepared to lend money. This belief that money is not available for small businesses is just not true. In this region, theres plenty of money to do that.

However, he added, businesses are definitely being cautious. Theyre not 100% comfortable because they dont know where the economy is going. We are finding some real caution in terms of whether people want to leverage their organizations more.

David Glidden, regional president of TD Bank, sees the same skittishness.

There has clearly been a drop in demand from borrowers, he told BusinessWest. A lot of companies were dealing with are rightfully nervous about the economy and have been paying down debt instead of building up cash. Theyre nervous about when theyre going to see the light at the end of the tunnel economically.

These two trends the repercussions of the credit crunch and a reluctance to borrow could be starting to give way to more activity as businesses gain more confidence. But bankers say that, while they want to lend, they need to see healthy revenue streams and an ability to repay. And so far, the uptick in commercial loans has been sluggish at best.

Emerging from the Storm

According to Plunkett Research, a provider of financial-industry trend analysis and market research, greatly increased regulatory oversight has already begun to restrict lenders, and an era of much lower risk-taking by bankers has begun.

Yet, the executives we spoke with stressed that regional banks and, in TD Banks case, a larger institution with a strong presence in Western Mass. remained healthy throughout the crisis because they werent prone to taking unwise risks in the first place.

Last year, from a market standpoint, statistics would certainly back up a contraction in commercial lending in the U.S., Glidden said. But you have to understand that a lot of the larger, money-center banks were having financial issues with their own balance sheets.

Regionally, however, many of the banks, ourselves included, remained triple-A-rated institutions, and our lending outpaced the market, he said. There was a huge constriction just because the volume of lending capacity represented by the large players dropped.

Our health is fantastic, Scully said, noting that Country Bank made close to $7 million last year and is well-capitalized to lend. None of that is an issue. The marketplace has contracted, and businesses arent ready to take that next step and say, I want to expand my organization.

Thats the way of the world right now, he added. I think caution is a good thing for a business, but I dont expect any change for awhile; I think this caution will continue right through 2010. We may not start to see any pickup until businesses are at the point of increasing their employment base.

Banks want to write loans, said Jeffrey Sattler, president of NUVO Bank, a recently established player in the regional lending market. But theres not enough incentive out there in the economy for businesses to take on undue risk. Theyre not borrowing; theres also too much uncertainty with issues like taxes and health insurance.

The landscape is better than it was a year ago, he conceded. I do think theres a sense of optimism; on the other hand, were not out of the woods. Were seeing very low appraisal values.

M. Dale Janes, NUVOs CEO, said New England-based banks were good, sound lenders, for the most part, on commercial real-estate and residential mortgages. But the subprime market crashed so hard and had such a ripple effect; people lost jobs, businesses lost revenues.

Many businesses are struggling with profits right now, with lease rates on property down and revenue streams curtailed. Sattler cited one loan applicant whose business brought in $1.5 million in sales one recent year, and $600,000 the next, with a net loss of about $125,000.

For such cases, Plunkett Research said alternative lending sources are on the rise, from peer-to-peer loans to angel investors. Janes said family-and-friends lending can fill the gap, as can agencies like MassDevelopment, but we need more of these kinds of programs.

Janes suggested that the real-estate market might be near the bottom, because there are bottom fishers out there now, looking to purchase distressed real estate at rock-bottom prices. When the bottom fishers are coming in and starting to get active, thats followed by more activity from people who are not necessarily looking for the lowest price.

The problem is, some go get big buildings that are 15 or 20 years old, well-constructed, for an unbelievable price, but they may not have any tenants, or enough to provide the bank with cash-flow coverage to support the loan, he said. So there may be great real-estate deals, but they need to make sure they have their own money or lease it up first, then come to the bank. I dont think any bank, with the way the regulatory environment is, can finance distressed real-estate properties that are not fully leased.

On the Way Up?

In Western Mass., Glidden said, there are a number of major industries that drive the regional economy. The state economy has obviously seen a transformation to much more of a service economy, but when you look at Western Mass., the areas that have stayed robust have been good areas to lend in health care, higher education, even the manufacturing sector in Western Mass. and the Greater Connecticut River Valley has done surprisingly well throughout this economic recession.

Still, the nervousness many feel about the economy has caused even thriving businesses to shy away from investing in their companies, choosing instead to pay down existing debt on an accelerated basis and build up cash reserves, he explained, adding that the pace of loans will pick up once its clear that the economy has indeed hit bottom and is on its way back and employers are increasingly feeling that way.

Im starting to get the sense from business owners that their level of confidence is coming back, which is the first and most important thing, Glidden said. Many businesses have been doing well, but if they dont have a lot of confidence in the economy, theyre not going to reinvest.

Meanwhile, banks continue to say theyre ready to loan to companies that do get back in the market and are financially stable enough to do so.

Were all at the mercy of where the markets are going, Sattler said. There arent many cranes in the air. Look at Springfield; there arent many buildings being created, while theres a glut of buildings in industrial parks waiting for someone to fill them.

Were looking for those who want to reinvest, but weve got to find where the bottom is, he added. After that, well see more people coming back to reinvest in their buildings.

Janes said there will always be a bad real-estate deal or two, or an overly aggressive bank facilitating it, but that situation is the exception right now, not the rule, and banks will continue to be cautious.

If a company has a decent track record over the past few years and a reputation for good management, banks will be lined up at their door. Everyone wants loan volume, but its got to be quality loans, he said. Banks are aggressive to get new business, but not aggressive like they were years ago, cutting rates and reducing collateral requirements. Were all trying to sell our services, but were trying to bank responsibly, too.

Its a philosophy that kept regional banks afloat while national institutions were rocked by their own poor lending decisions and has kept them prepared to do business as the economic picture improves.

People feel, knock on wood, that the worst is behind us, Glidden said, stressing, however, that no one thinks the economy will come racing back, only that it might have hit bottom. Even though its not necessarily a robust environment, businesses are starting to feel better about looking at expansions and acquisitions and seeking capital. When they dont have that level of confidence, they kind of hunker in.

So were optimistic that weve turned a corner, he continued. But caution will continue to be the operative word for the next 12 to 18 months.

Its still very slow and very cautious, and there are still a lot of fragile pinnings to this economy that can go the wrong way. But as the businesses we deal with get more confidence, were hopeful that the worst is behind us, and we can start cautiously moving ahead again.

Joseph Bednar can be reached at

[email protected]

Reaching Farther Together

By BusinessWest Staff April 26, 2010

Sections Supplements

Women Presidents? Organization Provides a Forum for Growth

Sarah Morin says WPO has helped her work on her business, and not in her business.

Some members call it a support group, while others say its like having a board of directors. Some use both phrases interchangeably. Theyre talking about the Springfield-area chapter of a group called the Women Presidents Organization, a three-year-old outfit that provides an effective forum for sharing ideas and helping businessiness and individuals grow.

Sarah Morin says she keeps pretty busy trekking between her two Buffalo Wild Wings Grill & Bar franchises in Hadley and Windsor, Conn. But she has some ambitious plans that will tax her time, and her vehicle, much further.

Indeed, she wants to have several more operations going in Southern New England within a few years, and is aggressively searching for attractive sites for the sports- and family-oriented restaurants. Managing the two she has while also drawing an outline for explosive growth is challenging, and she says she often found herself looking for what she called, alternately, a support group or informal board of directors to bounce things off and gain valuable insight.

Shes found one in the local chapter of the Women Presidents Organization, or WPO, which, as the name suggests, brings women business owners together to share ideas, concerns, issues, hopes, dreams, and more. The local group, the Springfield-area chapter, was formed three years ago with the help of some women who were members of the Boston chapter and thought Western Mass. needed its own. The Springfield chapter reached its current number, 13, thanks to a recruiting drive that brought Morin and several others into the ranks, with the goal of getting to 20 and perhaps more.

The group meets once a month for 3 1/2 hours, said Morin, noting that this a serious time commitment for busy business owners, but one she is willing to make given what she takes home with her after each session and what the group is helping her focus on.

Specifically, this comes down to working on your business, not in your business, she said, adding that this is a problem common to many in growing companies. Most business owners spend most of their time putting out fires, meeting deadlines, and doing whats necessary to keep a business going day to day, she continued, adding that she wants to spend much more time in what she called the next quadrant: doing planning, relationship-building, and staff development. Thats where I want to live, and this group is helping me get there.

Using a roundtable format, WPO puts aside time each meeting to dive into one members issue, said Cathy Crosky, chapter chair and a principal with the Charter Oak Consulting Group in Williamsburg. Thats accomplished not by preaching or telling that individual what to do, she continued, but by sharing experiences and providing insight into matters ranging from succession issues to effective use of social media to finding alternative funding sources.

We do something called a peerspective, she said, referring to the process by the Edward Lowe Foundation. It takes us through a structured process so that we can understand a situation deeply and help that person think it through in a different way and offer perspective.

Lauren Wright, president of Ludlow-based CSW Inc., a provider of integrated services for packaging, was the beneficiary of one such peerspective, this one involving what she called a desired culture shift, from production-focused to sales-and-service-focused.

I was having some issues around that, so we brainstormed ways to get employees more involved and raise accountability, she said. They had some great suggestions, some of which Ive already implemented. It has helped quite a bit; I love being able to get input from people with so much knowledge and experience.

The women-only format, meanwhile, provides an environment featuring individuals with shared challenges and an understanding, and appreciation, of the many nuances (and headaches) of balancing life and work.

This is a network of women who understand what its like every morning to go to your little laptop to see if theres any money in the bank, said Nancy Urbschat, owner of Springfield-based TSM Design and one of the first members of the Springfield chapter. Its important to have someone to talk to someone who has that understanding because owning a business is a lonely position.

For this issue and its focus on women in business, BusinessWest takes an indepth look at WPO, its mission, and how it carries it out.

Meetings of the Minds

Reaching farther. Together.

Thats the working slogan for WPO, and Crosky says those three words effectively convey what the organization is all about.

At a time when more women are becoming business owners, but also when many such women (especially those over 40) lack role models, WPO essentially provides a room full of them. But it goes much further; by bringing these women together, the group helps them meet career goals, set new ones, and, well, reach farther.

Women being in leadership roles and owning their own businesses is still relatively new, said Crosky. A generation before us most of us didnt have mothers who do what we do. The group provides an opportunity to learn from one another and benefit from the wisdom of the other women in the group.

People can learn best practices and hear about things that people have gone through that they havent gone through yet, she continued. In that way, its like a peer-advisory group or a board of directors. Its a way to look at your business through many different lenses.

And while some WPO members were admittedly skeptical about the need for and value of a women-only group, they have, though their experiences with the organization, come to the conclusion that there is a clear need for such an organization.

For most of us, if not all of us, there was some initial apprehension about a group solely for women, Urbschat said. But this group provides the kind of opportunity that many men are afforded, to have that kind of peer group to bounce ideas of, to mentor, and to be supportive. This is an alternative for us, and even though many of us were reluctant at first, its value has been proven time and again.

WPO, which was founded in 1997 and now has 83 chapters worldwide, is open to women who own their own companies or have a partnership stake, as in the case of a law firm or accounting firm. The companies involved must have at least $2 million in annual sales ($1 million for nonprofits), making them what Crosky called second-stage businesses, and not startups.

There is significant help available to new businesses, she said, noting such groups as the Mass. Small Business Center Network and other agencies, but not nearly as much for these second-stage outfits, and especially for those owned and managed by women.

You have to lead differently when youre a second-stage entrepreneur than you do when youre a startup, she explained. And theres just not a lot of support out there for the kinds of things business owners face when their businesses start to grow.

There are 10 stated primary objectives for the organization. Specifically, it strives to:

Increase the business and financial success of women presidents;

Develop innovative solutions to business challenges through discussions held in a confidential environment;

Provide continuing education in business and leadership;

Increase awareness of womens issues and opportunities;

Provide a forum where women presidents can make strategic contacts and promote business development;

Increase the visibility of women presidents on the local, national, and international levels;

Provide business resources including monthly newsletters, a Web site, media referrals, an annual membership director, and an annual conference;

Advance the influence of women in the business community;

Re-energize and revitalize women presidents, leading to a more productive balance in work and life; and

Celebrate the success of women in business.

Not Winging It

The current membership of the Springfield chapter conveys diversity (one of its oft-listed assets), with many professionals, including a lawyer, accountant, and business consultants, and many sectors represented, including manufacturing (Als Beverage), retail (Buffalo Wild Wings and Fran Johnsons Golf & Tennis), and advertising and marketing.

Morin, who noted that she is very much in the minority as a woman in the world of restaurant franchising, said her five-year plan is quite ambitious, calling for perhaps 15 franchises in Southern New England, with the third coming later this year. A girls got to dream, she told BusinessWest, noting that WPO is helping her do that, and will likely be a real force in making the dream come true.

When asked how the group has helped her and others, Morin said it comes down to imparting wisdom and support, not through preachy lectures, but through queries aimed at helping an individual contrive their own solution.

The feedback, or feed-forward, comes in the form of questions, so you dont have that, in my second year in business, I did this she explained. Its less anecdotal. And when the probing comes in the form of a question, not only does the person with the problem or issue benefit, but we all do.

We turn it inward and think of how its applicable to our business, she continued. I find that incredibly helpful and unique to this group, as opposed to other professional organizations.

Urbschat said she joined WPO not long after long-time business partner Leslie Lawrence left TSM. It was a difficult time in her career, one when she was questioning what she wanted to do and how to go about doing it.

I needed to think about whether I wanted to continue doing this or do something else, she said. I eventually concluded that I did want to keep doing this, but that I actually needed to figure out what would be an appropriate role for me in the business. My roles had to change.

I was inspired by the other members and their stories to think about growing the business, she continued. I had always been happy with it just being where it was, and it had been there for a a lot of years; we had been just sort of skidding along. Now, I actually have goals. Ive been alive for 58 years, and this is the first time in a while Ive actually had goals.

One element of WPO that Urbschat finds unique, as well as helpful, is the desire of members to hold others in the group accountable when it comes to issues theyre facing and steps they are taking.

If someone walks away with a solution and chooses to ignore it, there may well come a time when someone might say, you know, what have you done about that thing you were concerned about? she explained. That accountability is a really good thing for a small business because we dont have boards of directors saying, these are our expectations of you.

Meghan Sullivan, a partner with the Springfield-based law firm Sullivan Hayes & Quinn, is another newcomer to the group. Crosky invited her to join after hearing her speak on her specialty, employment law.

Sullivan said shes learned a lot about business, and people, since joining, and especially about strategic planning and more-efficient use of time, energy, and resources in ways that move the business forward and hopefully motivate people to follow you.

Other members have helped me become more cognizant of situations where youre so caught up in the minutiae that youre missing the mission of the organization, she continued. Theres really been some learning opportunities presented in ways that, while I was in some ways aware of the concepts, I hadnt brought them to the forefront in my business.

Generous Share

When asked for a qualitative perspective on the value provided by WPO, Urbschat found a rather uniue and insightful answer.

How many 3 1/2-hour meetings do you look forward to? she asked, letting that question stand by itself, because it could.

Others used different words and phrases, but expressed generally the same sentiment: this is time and energy well-spent, because, as Urbschat said, running a business is a lonely job.

And with WPO, these women leaders never have to go it alone.

George OBrien can be reached at[email protected]

Who’s Who

By BusinessWest Staff April 26, 2010

Sections Supplements

A list of exhibitors taking part on May 5

Adam Quenneville Roofing & Siding

(413) 536-5955

160 Old Lyman Road

South Hadley, MA 01075

www.1800newroof.net

Booths: 25 & 26

Affiliated Chambers of Commerce of Greater Springfield Inc.

(413) 787-1555

1441 Main St.

Springfield, MA 01103

www.myonlinechamber.com

Booth: 74

After Hours DJ & AV Rental

(413) 562-2632

1310 Russell Road

Westfield, MA 01085

www.afterhoursdj.net

Booths: 43 & 44

American Convention Services

(413) 739-6811

Springfield, MA 01104

www.americanconventionservice.net

Booth: 31

An African American Point of View

(413) 796-1500

688 Boston Road, Suite B

Springfield, MA 01119

www.afampointofview.com

Booth: 84

Answer Is Fitness

(888) 270-3640

1739 Allen St.

Springfield, MA 01118

www.answerisfitness.com

Booths: 68 & 69

Bay Path College

(800) 782-7284

588 Longmeadow St.

Longmeadow, MA 01106

www.baypath.edu

Booth: 189

Bert Hill Moving and Storage

(413) 485-0050

978 Southampton Road

Westfield, MA 01085

www.berthill.com

Booth: 114

BusinessWest & The Healthcare News

(413) 781-8600

1441 Main St.

Springfield, MA 01103

www.businesswest.com

Booth: 54

Career Point

(413) 532-4900

850 High St.

Holyoke, MA 01040

www.careerpointma.org

Booth: 138

Catuogno Court Reporting and Sten-Tel Transcription

(413) 746-8100

One Monarch Place, 1414 Main St.

Springfield, MA 01144

www.catuogno.cc

Booth: 50

Chicopee Savings Bank

(800) 662-0974

70 Center St.

Chicopee, MA 01014

www.chicopeesavings.com

Booth: 99

Clear Channel Radio

Phone (413) 781-1011

1331 Main St., Suite 400

Springfield, MA 01103

www.mix931.com

Booth: 56

Comcast Business Services

(413) 730-4540

3303 Main St.

Springfield, MA 01107-1111

www.comcast.com/business

Booth: 34

Constellation New Energy

(617) 772-7500

116 Huntington Avenue, Suite 700

Boston, MA 02116

www.newenergy.com

Booth: 102

Country Bank

(413) 967-6221

75 Main St.

Ware, MA 01082

www.countrybank.com

Booth: 92

Crestview Country Club

(413) 786-2593

Shoemaker Lane

Agawam, MA 01001

www.crestviewcc.org

Booth: 42

DiGrigoli Salons

(413) 827-8888

1578 Riverdale St.

West Springfield, MA 01089

www.digrigoli.com

Booths: 195 & 196

Eastfield Mall

(413) 543-8000

1655 Boston Road, Unit A11

Springfield, MA 01129

www.eastfieldmall.com

Booth: 192

EDC of Western Mass.

(413) 593-6421

1441 Main St.

Springfield, MA 01103

www.westernmassedc.com

Booth: 73

Elms College

(413) 594-2761

291 Springfield St.

Chicopee, MA 01013

www.elms.edu

Booth: 110

Fandotech

(866) 514-4415

78 Interstate Dr.

West Springfield, MA 01089

www.fandotech.com

Booth: 115

Fasttrack Airport Parking

(800) 590-6789

24 Ella Grasso Turnpike

Windsor Locks, CT 06096

www.avistarparking.com/fasttrack

Booth: 27

Forest Park Zoo

(413) 733-2251

302 Sumner Ave.

Springfield, MA 01138

www.forestparkzoo.org

Booth: 194

Freedom Credit Union

(413) 739-6961

P.O. Box 3009

Springfield, MA 01101

www.freedomcoop.com

Booth: 199

FutureWorks

(413) 858-2800

1 Federal St., Building 103-3

Springfield, MA 01105

www.getajob.cc

Booth: 72

Get Set Marketing, LLC

Phone (413) 781-7800

125 Main St.

Springfield, MA 01105

Booth: 65

Hampton Inn & Days Inn

Phone (413) 593-1500

600 Memorial Dr.

Chicopee, MA 01105

www.chicopee.hamptoninn.com

Booth: 131

Harrington Insurance Agency Inc.

(508) 219-0209

www.harringtonsaves.com

Booth: 190

Health New England

(413) 233-3178

One Monarch Place, Suite 1500

Springfield, MA 01144

www.healthnewengland.com

Booths: 90 & 100

H.L. Dempsey Co.

(413) 736-8742

103 Baldwin St.

West Springfield, MA 01089

www.hldempsey.com

Booths: 35 & 45

Holyoke Community College

(413) 538-7000

303 Homestead Ave.

Holyoke, MA 01040

www.hcc.edu

Booth: 60

Holyoke Gas & Electric Department

(413) 536-9463

One Canal St.

Holyoke, MA 01040

www.hged.com

Booths: 197 & 198

H&R Block

www.hrblock.com

Booth: 86

La Voz Hispana Newspaper

(203) 865-2272

51 Elm St., Suite 307

New Haven, CT 06510

www.lavozhispanact.com

Booth: 63

Landmark at Monastery Heights

(413) 781-1282

110 Monastery Ave.

West Springfield, MA 01089

www.landmarkseniorliving.com

Booth: 96

Liberty Mutual Insurance

(413) 567-2000

175 Dwight Road

Longmeadow, MA 01106

www.libertymutual.com

Booth: 98

Lincoln Culinary Institute

(866) 672-4337

1760 Mapleton Ave.

Suffield, CT 06078

www.lincolnedu.com/schools/lincoln-culinary-institute

Booth: 180

MacDuffie School

(413) 734-4971

One Ames Hill Dr.

Springfield, MA 01105

www.macduffie.org

Booth: 61

n Mary Kay Cosmetics

(413) 530-1786

www.www.marykay.com/jmcnulty8

Booth: 137

MassLive, LLC

(413) 733-2000

32 Hampden St., 4th Floor

Springfield, MA 01103

www.masslive.com

Booths: 70 & 80

MassMutual Center

(413) 787-6610

1277 Main St.

Springfield, MA 01103

www.massmutualcenter.com

Booth: 91

McIntire Business Products

(800) 847-2463

128K Hall St.

Concord, New Hampshire 03301

www.mbp-inc.com

Booth: 17

Mercy Medical Center Bloodmobile

Phone (413) 748-9000

271 Carew St.

Springfield, MA 01104

www.mercycares.com

Booths: 175-179

Meyers Brothers Kalicka, P.C.

(413) 536-8510

330 Whitney Ave., Suite 800

Holyoke, MA 01040

www.meyerskalicka.com

Booth: 30

MJ Norton Security Inc.

(888) 734-0707

318 Griffith Road

Chicopee, MA 01022

www.mjnortonsecurity.com

Booth: 132

Moriarty & Primack, P.C.

(413) 739-1800

1414 Main St., Suite 1300

Springfield, MA 01144

www.mass-cpa.com

Booth: 95

NECS

(800) 321-NECS

www.necs.biz

Booth: 183

New England Financial Group

(860) 521-2250

17 North Main St.

West Hartford, CT 06107

www.nefghartford.com

Booth: 83

New England Tractor Trailer Training School

(800) 243-3544

32 Field Road

Somers, CT 06071

www.nettts.com

Booth: 184

Northeast Security Solutions Inc.

(413) 733-7306

33 Sylvan St.

West Springfield, MA 01089

www.northeastsecuritysolutions.com

Booth: 82

Peter Pan Bus Lines

(800) 343-9999

P.O. Box 1776

Springfield, MA 01102

www.peterpanbus.com

Booths: 75 & 76

Pioneer Valley Planning Commission

(413) 781-6045

60 Congress St., Floor 1

Springfield, MA 01104

www.pvpc.org

Booth: 133

Porter & Chester Institute

(413) 593-3339

134 Dulong Circle

Chicopee, MA 01022

www.porterchester.com

Booth: 3

ProShred Security

(413) 596-5479

75 Post Office Park

Wilbraham, MA 01095

www.proshred.com

Booth: 140

Regional Employment Board of Hampden County Inc.

(413) 755-1357

1441 Main St.

Springfield, MA 01103

www.rebhc.org

Booth: 103

Reminder Publications

(413) 525-3247

280 North Main St., Suite 1

East Longmeadow, MA 01028

www.thereminder.com

Booth: 207

The Republican

(413) 788-1000

1860 Main St.

Springfield, MA 01103

www.masslive.com

Booth: 81

ResaVue Exhibits

(860) 627-6399

10 Stran Road

Milford, CT 06460

www.resavue.com

Booth: 1

Roger L. Putnam Vocational Technical High School

(413) 787-7424

1300 State St.

Springfield, MA 01109

www.sps.springfield.ma.us

Booths: 200 & 201

Roger Sitterly & Son, Inc.

(800) 533-1171

P.O. Box 2530

Springfield, MA 01101

www.sitterlymovers.com

Booth: 87

Royal & Klimczuk, LLC

(413) 586-2288

1350 Main St., 4th Floor

Springfield, MA 01103

www.rkesq.com

Booth: 89

RRD Technologies

(413) 786-5255

80 Ramah Circle South

Agawam, MA 01001

www.rrd-tech.com

Booth: 185

Sage Engineering and Contracting Inc.

(413) 562-4884

199 Servistar Industrial Way, Suite 2

Westfield, MA 01085

www.sage-llc.com

Booth: 135

Sheraton Springfield Monarch Place Hotel

(413) 781-1010

One Monarch Place

Springfield, MA 01144

www.sheraton.com/springfieldma

Booth: 160

S.J. Services Inc.

(800) 281-1665

52 Robbins Road

Springfield, MA 01104

www.sj-services.com

Booth: 94

Spirit of Springfield

(413) 733-3800

101 State St., Suite 220

Springfield, MA 01103

www.spiritofspringfield.org

Booth: 40

Springfield Armor

(413) 746-3263

One Monarch Place, Suite 220

Springfield, MA 01144

www.nba.com/dleague/springfield

Booth: 62

Springfield Business Improvement District

(413) 781-1591

1441 Main St., 1st Floor

Springfield, MA 01103

www.springfielddowntown.com

Booth: 191

Springfield College

(413) 748-3000

263 Alden St.

Springfield, MA 01109

www.springfieldcollege.edu

Booth: 101

Springfield Falcons Hockey Club

(413) 739-3344

45 Falcons Way

Springfield, MA 01103

www.falconsahl.com

Booth: 125

STCU Credit Union

(413) 732-9812

145 Industry Ave.

Springfield, MA 01104

www.stcu.com

Booth: 67

Steve Lewis Subaru

(413) 584-3292

48 Damon Road

Northampton, MA 01060

www.stevelewissubaru.com

Booths: 38 & 39, 48 & 49

TD Bank

(413) 748-8231

1441 Main Street

Springfield, MA 01103

www.tdbank.com

Booth: 85

United Personnel

(413) 736-0800

1331 Main St., Suite 100

Springfield, MA 01103

www.unitedpersonnel.com

Booth: 64

Univision-TV 43

(860) 278-1818

One Constitution Plaza, 7th Floor

Hartford, CT 06103

www.wuvntv.com

Booths: 32 & 33

Valley Communications Systems Inc.

(413) 592-4136

20 First Ave.

Chicopee, MA 01020

www.valleycommunications.com

Booths: 187 & 188

Verizon

(800) 941-9900 begin_of_the_skype_highlighting (800) 941-9900 end_of_the_skype_highlighting

www.verizon.com

Booth: 55

Western Mass Wellness, LLC

(413) 732-9355

West Springfield, MA 01089

www.westernmasswellness.com

Booth: 53

Western New England College

(413) 782-3111

1215 Wilbraham Road

Springfield, MA 01119

www.wnec.edu

Booth: 71

Westfield State College

(413) 572-8020

577 Western Ave.

Westfield, MA 01086

www.wsc.ma.edu

Booth: 105

Westover Job Corps

(413) 593-4000

103 Johnson Road

Chicopee, MA 01022

www.westoverjobcorps.com

Booth: 2

WFCR 88.5 FM & WNNZ 640 AM Public Radio

Phone (413) 577-0779

Hampshire House, UMass

131 County Circle

Amherst, MA 01003-9257

www.wfcr.org

Booth: 104

WGBY

(413) 781-2801

44 Hampden St.

Springfield, MA 01103

www.wgby.org

Booth: 93

Whalley Computer Associates

(413) 569-4200

One Whalley Way

Southwick, MA 01077

www.wca.com

Booth: 15

Wilbraham & Monson Academy

(413) 596-6811

423 Main St.

Wilbraham, MA 01095

www.wmacademy.org

Booths: 57 & 58

WMAS 94.7 FM & ESPN 1450 AM

(413) 737-1414

1000 West Columbus Ave.

Springfield, MA 01105

www.947wmas.com

www.espnspringfield.com

Booth: 14

Zasco Productions, LLC

(800) 827-6616

340 McKinstry Ave., Suite 400

Chicopee, MA 01013

www.zascoproductions.com

Booths: 202 & 203

The Push for Corporate Sustainability

By BusinessWest Staff December 21, 2009

Sections Supplements

It’s Good for Public Relations, Good for the Bottom Line

Lock four business professionals in a room, and chances are youll get four different opinions about what sustainability means. Some may see it as a way that corporations can help stop global warming. Another might say that global warming is a lie, and corporations are wasting their time spending money trying to save the environment. Still others may say sustainability is simply replacing Styrofoam cups with paper or coffee mugs that can be washed.

The truth is that there really is no one definition of sustainability and all of the above answers have a kernel of truth. By adopting a sustainability plan, a company can take steps that may reduce their carbon footprint. Even if you dont believe in global warming, your company may still see a financial benefit in switching from electrical heat to natural gas. But no matter how you slice it, sustainability is the new corporate buzzword, and, like it or not, the public is watching.

Right now most American companies are about a decade behind European companies when it comes to understanding what sustainability is and how a company can use sustainability efforts to not only save money but position themselves ahead of their competition. Sustainability efforts are no longer just being undertaken by hemp clothing retailers in San Francisco. In July 2009, Wal-Mart announced a major restructuring of the way it handles packaging and vendors based on a new sustainability index. And we all know that once a company like Wal-Mart is on board, the business landscape changes.

A modern sustainability program is based upon the idea of a triple bottom line, which refers to a companys economic viability, its social responsibility, and environmental responsibility. Adopting a sustainability program doesnt mean that your company has to generate all of its own power and convert its fleet to battery-operated cars. It simply means deciding what types of graduated steps youd like to adopt to show social and environmental responsibility and then letting the world know what youre doing through an annual Corporate Social Responsibility (CSR) Report.

CSR reports are just starting to catch on among American businesses. A good example is one that is on the Starbucks Web site, explains Kretz. If you look at the Starbucks report, youll see that the company outlines various initiatives that it is undertaking to minimize its environmental impact and give back to the communities that it serves. For example, they talk about their transition to only selling fair-trade coffee beans, powering their stores with renewable-energy sources and employee volunteer programs. When you read it, you begin to understand that Starbucks hasnt undergone a drastic transition. Rather, they are implementing something gradual but purposeful and looking good while doing it.

Winning the PR Battle

One of the benefits of developing a sustainability strategy is the fact that it automatically opens your company up to positive public-relations opportunities. The number of consumers who value environmental and sustainability efforts is growing every day, and by communicating your actions to those who are interested, you are positioning your company to look more attractive versus a company that has no sustainability plan.

There are Web sites devoted to help interested people find information about what companies are doing with regard to sustainability, says Kretz. CSR reports are indexed and readily available online. And its important that theyre accessible because many consumers and business will refuse to patronize a business that isnt implementing at least some type of sustainability initiative.

A perfect example of using sustainability practices for PR comes from Kostins homebuilding clients. Many are building higher-end homes in accordance with Leadership in Energy and Environmental Design (LEED) specs because, in a tough home market, a LEED rating can be the difference between a home selling or languishing on the market for months.

A commitment to sustainability also helps with internal PR because studies have shown that employees especially younger ones look favorably upon such efforts. A CSR is an easy way to illustrate your companys commitment to sustainability, which can also be of use when hiring.

Going Green Means Saving Green

Remember that a good sustainability program is supposed to contribute to a companys triple bottom line. This means that a good sustainability campaign will also help save the company money.

There are a number of ways that a company can help the environment and save money at the same time. The easiest way to do this is by taking advantage of the numerous tax credits and incentive programs for installing energy-saving equipment or replacing older equipment with newer, more efficient items. The recent stimulus packages included more than $61 billion in credits and grants for energy conservation.

Some examples of the government credits available are for adding insulation to your home and purchasing hybrid vehicles. On the business side, there are grants available for solar panels and wind, power, tidal, and geothermal power. Of course, these programs start and end all the time, so speaking with your tax professional is a good start to find out what types of programs are currently available.

Beyond tax credits and incentive programs, sustainability programs have other benefits that may be small but add up over time. For example, a company changing from disposable cups to having employees bring in washable mugs will not only reduce waste but will save the company the money they spent supplying the cups. Implementing a data-warehousing system can not only help a company reduce the need for printed, archival copies of files, but it will also reduce the square-foot cost for storage needs and usually results in quicker retrieval of data.

There are experts who specialize in sustainability audits who can come into a company, see how it is currently operating and suggest small measures that can really add up. When the price of gas spiked above $4 a gallon, many companies started trying to figure out ways to reduce travel with videoconferencing or by stacking together trips so that multiple clients could be visited in one day. Even though gas is now below $3 a gallon, that strategy of reducing travel not only enhances a companys sustainability efforts, it will mean less money burned down the tailpipe.

The Wal-Mart example illustrates the ultimate bottom-line impact. Part of Wal-Marts plan is to measure the sustainability of every product it will sell. It is forecasting a day in the next couple of years when it will be able to label all of its products with a sustainability index number. Those companies that arent currently working to minimize their packaging and quantify the environmental impact of their product and manufacturing processes will find that the large retailer will no longer sell their product. Thats where you can easily see that companies with no sustainability plan wont be able to sustain their business model.

What the Future Holds

Theres no question that companies need to start working on assessing their sustainability efforts. The time is drawing nearer when it will be a necessity to have at least some type of report available that outlines what your company is doing with regard to minimizing its impact on the planet and maximizing its efforts to help members of your community.

For example, the American Institute of CPAs has set up a task force to figure out best practices around sustainability initiatives. In fact, Prince Charles, a proponent of sustainable farming and other practices, spoke to the groups annual conference this year to encourage further development of sustainability in the U.S.

CSR accounting has only been around for a decade, and its still evolving. But companies that commit to measuring their sustainability can demonstrate their interest in the environment to their employees and communities, build trust and promote transparency, and show their commitment to their important stakeholders. CSRs are gaining momentum, and companies that arent taking action now risk finding themselves on the wrong end of business and consumer sentiment in a few years. n

Richard Kretz is managing member and Brian Newman is member of the firm at Kostin, Ruffkess & Co., LLC, a certified public accounting and business-advisory firm with offices in Springfield as well as Farmington and New London, Conn. Beyond traditional accounting, auditing and tax consulting, the firm also specializes in employee benefit-plan audits, litigation support, business valuation, succession-planning business consulting, forensic accounting, wealth management, estate planning, fraud prevention, and information technology assurance;www.kostin.com.

Enhancing the Resolution

By BusinessWest Staff December 21, 2009

Sections Supplements

Year-end Is a Time for Businesses to Focus on Planning, Improving

Kevin Vann says that budgets are, by and large, discouraging, and they are especially so in times like these.

Sometimes you look at it, and you think, my God, another year of thinking about just trying to break even, or you wonder, am I going to have to trim payroll? he explained. You can be discouraged with a budget, and from my experience, thats why a lot of clients put them away or dont follow them.

But putting together a solid budget is one of the key ingredients in successful business planning short-term and long-term and its one of the many management matters that business owners should be thinking about as they prepare to turn the calendar, said Vann, president of the Springfield-based Vann Group, a business-consulting firm.

Actually, things like budgets, retirement plans, tax planning, insurance packages, benefits programs, employee handbooks, and many more are topics that business owners should be thinking about all the time, said Vann, who owns or co-owns a number of ventures and practices what he preaches. But because people are busy and now seemingly busier than ever often they dont, and thus year-end, as hectic as it is, can be an effective time to take action on such issues.

People make resolutions every Jan. 1, said Vann. Well, businesses can and should do the same.

Joe Messer agreed. A certified public accountant with the Holyoke-based accounting firm Meyers Brothers Kalicka, he said year-end is obviously a time to be thinking about, and executing, effective tax planning. But its also a good time to make commitments to address everything from evaluating technology needs to preparing a succession plan something far too many business owners put off until they have to, or until its too late.

A lot of business owners tend to think that theyre invincible and theyll be around forever, he said. And thats why they dont think about succession, which puts them in a bad situation when the time comes and they have to confront it.

There are myriad other issues that should be confronted on a regular basis, and year-end is a practical time to visit or re-visit them, said Sean Wandrei, a tax manager at Meyers Brothers Kalicka who listed matters ranging from retirement plans to cash-flow issues; from bank finance issues, such as covenants, to tax matters including income deferral and accelerating deductions.

In this, its final issue of 2009, BusinessWest takes a look at how business owners and managers can use the act of turning the calendar to help make their ventures run more efficiently and effectively plan for the long term.

Date with Destiny

Vann said that one of the things business owners and managers might want to do at year-end is look at their computer desktop.

I have about 35 icons on mine, and Ill bet Im using three or four of them, just those things required to do my job, he said, adding that, as part of an exercise in technology planning, individuals may want to examine why all those icons are there. All those other things someone either taught it to me or installed it for me, and Im not utilizing it properly.

Technology is a huge part of business management today, he continued, not just on the strategic side, but on the process side; were all waiting for that next wave of technology to drive our backroom processes and help us manage our time better.

What business owners can, and should, be thinking about this time of year is taking their desktop review exercise and doing roughly the same thing with every aspect of their organization, said Vann, who outlines several types of planning that managers should be doing in a related story on page 23. And they should do so with an eye toward making their operation run more smoothly, while also prepping it for long-term success.

But they must do so with the understanding that effective planning, be it with technology, taxes, personnel, or succession, are truly year-round exercises.

These are things that people have to be thinking about at all time, not just year-end, said Messer, adding quickly that the start of a new year can indeed be an effective time to make what may amount to resolutions. And one area he says should be at or near the top of the list is succession planning.

Its one of the most important, but also one of the most overlooked, aspects of business, he said. Who are we going to transition the business to when were ready to retire and move on to sunnier days?

To answer that question, business owners and managers have to identify who that next generation is going to be, he continued, and revisit the issue of succession on a regular basis to make sure the right party or parties have been identified and that the transition process stays on the right track.

While succession planning is important, especially for those business owners who have preferred to put off the inevitable, there are other business-management and planning issues that should also be considered at year-end, said Messer, who listed everything from cash flow to disaster-recovery plans, or, to be more specific, the lack thereof.

As for cash flow, accounts receivable is an issue impacting virtually every company in these trying economic times. Business managers should wait for year-end to put firm policies and procedures in place for collecting payments that are due, but if they dont have them, now would be a good time to put them in place.

In these tough economic times, receivables tend to get dragged out on a longer period and can make it very difficult for businesses to keep a positive cash flow, Messer explained. So business owners need to be proactive and implement strict collection policies and processes to help the cash flow remain positive.

And a key element in such policies must be consistency, he continued, adding that the best approach for businesses is to be proactive, not passive, when it comes to collecting bills.

Other matters to consider at year-end, said Messer, include health plan coverage and whether a better package is appropriate, the broad subject of inventory (how to reduce it and examination of why its not moving), and retirement plans and perhaps the need to diversify offerings.

One size doesnt fit all with respect to retirement benefits and retirement options you can offer to your employees, he said. Business owners and managers really need to look to identify the target group theyre trying to benefit. Do they want to benefit the business owner and a few key employees, or do they want to provide a benefit across the board to all employees?

Once you make those determinations and identify your key goals, he continued, then you can structure a plan and put it in place to meet those goals. There are so many variables out there.

Another important item for business owners to consider is insurance, said Wandrei, noting that year-end might be an appropriate time to think about possible courses of action when existing policies expire.

John Dowd, fourth-generation principal, specifically executive vice president, of the James J. Dowd & Sons Insurance Agency, said there are a number of factors to consider when reviewing ones insurance package and determining whether it is appropriate.

Businesses change and expand from year to year, he explained, and insurance coverage must be adjusted to meet those changes, a point that is often lost on business owners trying to meet the day-to-day requirements of running their venture.

It happens all the time; people say, we dont need to meet and review things because nothings changed, he said. But then you sit down and talk, and the business owner says, yes, we sold that piece of equipment, and we bought that piece of equipment, and, by the way, were storing things in a different location. All those things are important because they impact the coverage you need.

Overall, Dowd said business owners must consider the worst-case scenario when it comes to calamity and possible loss, but, unfortunately, many do not, and they pay the consequences when the worst happens in a fire, flood, or other disaster.

I have to think of the worst-case scenario, because what if it happens? said Dowd, speaking as a broker. Granted, its not likely to happen, but if it does happen, youll be out of business if youre not properly covered. Business owners have to think about what theyll be faced with when they get that call in the middle of the night that their business has just burned down.

Another matter to consider at year-end is staffing, said Vann, noting that this issue has taken on a heightened sense of priority in this economic downturn. Indeed, many companies have downsized in recent months, and a good number have concluded that the smaller size is the right size. For others, more analysis is needed to answer that question.

A lot of people are looking at staffing right now and wondering if they can continue to make do without people who have been laid off, he said. Its a critical issue right now, and a very big part of the budgeting process.

The Bottom Line

Thats the often-discouraging budgeting process, as he described it, and one of those matters that business owners and managers let slide, for whatever reason.

Putting together a solid, realistic budget and then sticking to it is just one of many commitments that people should make as they approach the new year, said Vann, stressing, again, that such matters deserve year-round attention.

Let the resolution-making begin.

George OBrien can be reached at[email protected]

Its a Small World

By BusinessWest Staff December 21, 2009

Sections Supplements

Springfield’s ICT Center Forges Connections in a High-tech Global Marketplace

Gordon Snyder says teaching the teachers is key to keeping young Americans competitive in the high-tech world.

Gordon Snyder has done a lot of blogging about some fairly complex technologies, but nowadays, he likes to communicate through Twitter at least as much.

I find its much more effective if I have to condense something online to 140 characters or less, he laughed.

Whatever the vehicle, social media like Twitter are among the latest in a series of communications advances connecting people around the world like never before. And Snyder, executive director of the Information and Communications Technologies (ICT) Center in Springfield, is all about making connections.

Specifically, the ICT Center a division of Springfield Technical Community College located in the STCC technology park forges partnerships with other schools, mainly community colleges, to encourage the teaching of the most up-to-date information in tech-related courses, in order to help maintain American competitiveness in the global marketplace.

That is essentially what the center was created to do when it was launched in 1997, and the way communications, Internet use, and other technology has dramatically changed in the past 12 years in many ways reinforces the need for such a resource.

After all, hardly anyone was blogging in the late 1990s, and tweeting was the domain of birds.

Using far more than 140 characters, Snyder recently spoke with BusinessWest about how the ICT Center has succeeded in helping teachers, students, and others stay atop the fast-moving world of computer and communications technology.

Foundation for Success

At its core, ICT helps to develop programs and curriculum, Snyder said. We do a lot of faculty training, a lot of work with new and emerging technology, we offer workshops and conferences, and we provide subject-matter expertise.

And in that latter regard, the center has certainly grown. In the early days, it was focused on three subjects: fiber optics, wireless communications, and networking. But today, ICT calls upon some 60 experts in a much broader range of subjects to speak at conferences and work with colleges and employers.

We have faculty doing presentations on their work, giving presentations on things that people can take back to their own classrooms, he explained.

The mission of the ICT Center is based on an assertion that the information and communications technology industry driven by a demand for instantly accessible information is profoundly changing the world, as partly evidenced by the modes of communications that have existed for only a short time.

Preparing a workforce to compete in this global communications marketplace is todays major challenge for the ICT industry, and with even more rapid breakthroughs anticipated, education is the key.

In response to that rapidly growing need, STCC established the Northeast Center for Telecommunications Technologies in 1997. Aided by outside funding from the National Science Foundation and a number of businesses, the center was conceived as a resource for educators to help them stay abreast of the most current trends and technologies in their telecommunications programs, in turn preparing the experts of tomorrow.

Were a division of the college. Were making sure the programs are up to date, Snyder said. Another large part of our effort is recruiting and retaining underrepresented populations into the ICT fields.

To that end, the center works closely with organizations such as the Institute for Women in Technology and Trades (IWITT). Their focus is to attract women into some of these underrepresented programs, like computer science programs, he explained. Very few women are graduating from these programs across the U.S., so how do we get women interested in these programs and then keep them from dropping out or changing their major?

It wasnt too long before the NCTT got its first name change, however.

We wanted to expand our footprint beyond the Northeast, Snyder said, so we took the name of the National Center for Telecommunications Technologies.

The center was working with community colleges, and some four-year schools, in the Northeast, he continued. In changing its name to announce a broader focus, we began to reach out to the rest of the country, creating more partnerships and relationships with community colleges. It has been pretty successful.

So much, in fact, that two regional versions of the NCCT have been established in Fort Worth, Texas and San Francisco.

The center underwent another transition in the early 2000s that led to another name change just last year.

Back then, the Internet bubble was bursting, and the infrastructure was in some ways built out in the U.S, as much as it would be for awhile. We started to see a change in industry needs, and we started to add IT stuff to our physical layer content, Snyder said. It was a natural migration over the years, so a year and a half ago, we became the Information and Communications Technologies Center, a better description of the work were doing here.

Connecting the Dots

The ICT Center receives much less outside funding than it used to, but Snyder said it has developed a self-sustaining model that accomplishes a wider range of goals.

A lot of what were doing is making connections, he said. We were funded more in the beginning than were getting now, but I think were doing more now with a lot less money because were finding these people and making connections.

For instance, the center works on programs with the Economic Development Council of Western Mass. and the Regional Employment Board, hosting area business people at STCC for technology and communications conferences, which in turn raises the profile of the college.

That gives exposure to the campus, and it builds credibility for our students and our graduates, Snyder said. If theyre impressed with the place, theyre going to look more closely at our students when it comes time to hire somebody.

And community colleges, he said, are playing a key role in preparing students for high-tech careers, no matter what kind of credentials they have when they arrive.

You may not come in prepared; you might not come in at the right math level to take some of these courses, he said. If you took a good track that included math and science, youll place, and will be able to jump into the programs right away. Computer skills are important. But a lot of students have some catching up to do but thats one of the great things about community colleges.

Students who choose to study in the ICT fields might wind up working within that industry, but they can also apply those skills to an ever-widening number of other careers, said Nina Laurie, associate director of the ICT Center.

Technology is a big part of other disciplines, like finance and biotech, she said. So if someone wants to focus on one area and apply it to another area, thats really great, too.

But it all starts with training the trainers, and the center continues to grow its offerings in order to keep educators up to date, whether or not they can attend educator conferences like one being held in San Francisco on Jan. 7 and 8.

Sometimes its hard to get people caught up, Snyder said. With the reduced funding, were looking at other ways to help people. We have a YouTube channel, and were looking at streaming some conferences for people who cant attend them live. Budgets are tight right now, and were looking at other ways to disseminate the work were doing.

The ICT Centers Online Impact conferences which focus on social-media applications like Facebook, Twitter, and LinkedIn, are another good example of training people in the use of a business tool that didnt exist a decade ago. The second annual Online Impact event is scheduled for Jan. 14 at STCC (see related story, page 13).

Such conferences are just another way of making those connections Snyder talked about.

Its not always the same people who participate, but there are always new people coming into the mix, and that always changes things, he said.

An important thought and, at just under 140 characters, one he can instantly share with the world.

Joseph Bednar can be reached at

[email protected]

Getting Ready for Takeoff

By BusinessWest Staff December 21, 2009

Sections Supplements

AirPark South in Chicopee Will Give the Region Inventory, Flexibility

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When the Home Depot Corp. purchased 70 acres for a new regional distribution facility in Westfields Campanelli Business Park in October, it heralded a major contribution to that citys commercial portfolio.

But it also took one of the last developable parcels of land that size off the market, creating a void in the regions inventory of commercial tracts. However, that void will only be temporary, thanks to a recent acquisition that will create a new industrial park to be called AirPark South in Chicopee.

The new facility, which will join parks covering the other compass points at Westover, should come online in 2013, said Blair, and when it does, it will be, at 110 acres, the largest contiguous parcel of developable industrial land in the region, giving the region both inventory and much-needed flexibility as well as the opportunity to compete for Home Depot-sized projects.

The searches for those big properties are infrequent, said Allan Blair, president of the Westover Metropolitan Development Corporation (WMDC). At the moment in time when you cut the ribbon and are ready to go forward with any new property of that size, then you are ready to compete for those few opportunities.

The need for developable land the region is a constant, he said, citing such property as the location for future larger growth and investment. If we dont stay ahead of the curve on the development of those sites, he continued, then at some point were not going to be able to compete with other regions because we wont have a place to put new construction.

The ink is still wet on the paperwork for the purchase of 57 acres for that new park from the city of Chicopee, and Blair noted that there are a few other deals in the final stages of negotiation. When all is said and done, he said, the opportunity will be unique, not just for the city and the region, but for the Commonwealth.

Come Together

It was around five years ago, Blair said, that the WMDC purchased 38 acres from Tarnow Nursery, the first parcel destined to become AirPark South. Adjacent to that property is the recently purchased land from the city, which historically had been zoned residential. It wasnt really developable, he explained. Access was a problem, and it fell within the contours of a noise-mitigation study done by the Federal Aviation Administration. That granted us access to funds from the federal government.

In January 2009, the talks began between WMDC and Chicopee, and by this past summer, the parties had agreed to a $1.45 million price for the parcel. There were voices within Chicopee that initially had been critical of what was seen as a relatively low price paid for the property, but a market evaluation assessment set the land at the final selling price.

When speaking to the press at the time of the closing, Mayor Michael Bissonnette said that he had hoped for a higher price tag for the 57 acres, but in the long run, a poor economy and a lack of alternatives quelled any lingering doubts. Also, he agreed with Blair that, in order to stay competitive within the commercial real-estate market, the WMDC had the best plan to put the property in motion.

Currently the wooded acreage is but a twinkle in any developers eye. A small access road between the municipal airport at Westover and the Covidian property on Padgette Street is the planned portal to the property. When the parcel is slated to go online for development in 2013, it will be the largest contiguous commercial property available within the region. Its probably the last big chunk of property that can be assembled in this way, Blair said, and quite possibly the last in the region of this size.

With the airport next door, and significant frontage along the Mass Pike, he said that the last iteration of the successful AirParks might very well be the most exciting of them all.

We want to make sure that this is planned properly, he continued, and that the uses have some vision in there that will make the highest and best use of the land. By that I mean creating significant jobs, significant taxes, or supporting industry clusters in our region that we have been trying to support as opposed to just any use, just to sell the dirt. Thats not how we operate.

Even though the property could be scooped up by one tenant, the proposals set on the boards envision the probability that the park will be parceled into as many as 17 sites. Roadways and utilities would be built out in phases as the properties sell. Thats pretty much how our other parks have developed, Blair explained. We started with a big chunk and then gradually developed the smaller pieces.

More than likely, he continued, were going to find users in the 50,000-to-100,000-square-foot range, so we will end up subdividing the property. But again, its important to have the ability to compete for those larger prospects.

The WMDC estimates that between 1,000 and 1,100 jobs will be created by the park, with projected tax revenues for the city ranging toward $1 million. For the city, its a good opportunity to turn fallow land into economic prospects, and, according to Blair, good news for the airport as well.

Weve protected the approaches to the runway by eliminating the potential for incompatible land uses, namely residential, he said. That was the reason for the FAAs willingness to invest in the property.

If You Build It, They Will Come

When asked about the marketing prospects for AirPark South, Blair said that its really too soon to speculate. Environmental-impact studies over the next few years will determine what those prospects will be. But he said that, to his understanding, it would be for mixed-use development: from, in his words, plain-vanilla industrial to high-end research and development.

A lot will depend on what the market demands are for the regions commercial interests in 2013, though. How will we need to compete, and what will complement our existing properties? he said.

Marketing the property will come about when those decisions are made, he said, but given the size and scope of the property, the sales pitch wont be too difficult.

Thats a good size even today in the marketplace, he said. Its very difficult to find such a parcel anywhere that has access to such good utilities.

The new property also comes at a good time for the future of Westover. Of the three other industrial parks comprising several hundred acres, only a handful of available acreage remains. They are close to being maxed out, Blair said.

With the sound of hammers ringing in the hallways outside his office at the airport, echoing the development to come around the corner, Blair said this latest project will be a good cap to development in that part of Chicopee.

This conversion of property from military to civilian use has been one of the most successful of its kind in the country, in terms of taxes and jobs, he said. More than $2 million in taxes are paid to Chicopee from AirParks North and West alone, every year, and have been since the mid-90s.

Pointing to the map next to him containing the new plans, Blair said, these are very important economic-development endeavors for the municipality, and for the region.

Some Resolutions on Planning

By BusinessWest Staff December 21, 2009

Sections Supplements

As the calendar turns to 2010, business owners and managers should be thinking about resolutions, especially those involving effective planning.

Here are several types of planning that decision makers should consider critical for the year ahead.

Strategic Planning: Take time to research how to go about doing strategic planning and with whom. Perhaps the company can do it on its own, or perhaps it should hire a facilitator. In any case, set aside one or two days for strategic planning. This is one of the most critical blueprints every business should have, and it should be done at least once a year. This process should include owners and key staff members and perhaps outside consultants and independent parties as well.

Technology Planning: Each business should minimally have an internal staff member or an outsourced consultant to guide every company through the rigors of changing and updating technology. Time should be set aside for owners and key staff to be educated on a continuous basis. Technology will drive efficiencies, productivity, and revenue for most companies.

Employee / Staff / HR Planning: Each business today minimally needs either a staff person or an outsourced consultant to keep them up-to-date with the constantly changing compliance issues involved with having employees. Additionally, this planning model should include internal company issues, benefit packages, recruiting, retaining, and staying competitive. Any company that has employees should have a handbook minimally. The handbook should be reviewed annually.

Succession and Long-term Planning: Depending on the size of the company and the owners philosophy about life and business, succession and long-term planning for a company, the owners, and key staff should be a priority. If the owner of a company has done a good job addressing his or her own retirement and succession issues, then the company will continue to thrive. Fear of the unknown is the greatest fear, so the more effort the company puts into proper planning for the owners and key personnel, the better chance it has to continue. Even if an owner indicates an unwillingness to do succession planning, then certainly having a plan that indicates when and how to sell or liquidate the company is important.

Tax Planning: This has been pretty much accepted as an annual task by most business owners and key personnel; however, its still surprising just how many businesses make decisions, take on risk, and do business without properly understanding the tax consequences of their decisions.

Budgeting and Financial Planning: I just cant imagine a business or an individual, for that matter not making budgeting and financial planning a priority on an annual basis. Unfortunately, many, many businesses fail to do annual budgeting and financial planning. The budgeting process should include solid projections relative to revenue, expense planning, and profit expectations. This planning should also include cash-flow projections that take into account what capital expenditures need to be made, how much debt will be paid down, or how much debt or equity will be required to run or capitalize the business. The budget or financial plan should include the companys wish list for the coming year, and typically that list includes the items or initiatives from the strategic plan and all of the other planning during the year. The budget should be the by-product of all of the annual planning that has been done.

Kevin Vann is a principal with the Springfield-based Vann Group; (413) 543-2776.

Hire Ground?

By BusinessWest Staff December 7, 2009

Sections Supplements

The Economy Is Improving, but Where Are the Jobs?

Suzanne Bump says a recent, slight drop in unemployment in Massachusetts bodes well for the Bay State.

Just before President Obama hopped aboard Air Force One en route to China earlier this month, he announced a December jobs summit to address a big question facing his administration will this be a jobless recovery, as many experts are predicting?

And the focus of the summit will be on preventing, or minimizing, such an eventuality.

Nationally, unemployment has crept over the 10% mark, and there are signs that many companies that have made do with fewer employees in an effort to ride out the downturn are still cautious about hiring again. This has prompted questions, both regionally and nationally, about what kind of recovery can be expected if there is no real surge in employment and if such a development could even be called a recovery.

Gerald Epstein, a professor at the Political Economy Research Institute (PERI) at UMass Amherst, doesnt believe that term applies to what hes seeing.

If you have an unemployment rate that is measuring 10.2%, that doesnt take into consideration discouraged workers, or part-time workers who want to work full-time, because then its upwards of 17%, and for certain demographic categories, like young people, its over 20%, he explained. Statistics like that are not those of a recovery.

Elaborating, he said the current surge on Wall Street, which has seen a more-than-50% climb since March, cannot be expected to continue unless or until there is substantial job growth.

The stock markets cant continue to go up if the underlying basis of the economy, peoples ability to work and spend and consume, isnt supported, he said. Any growth will just be a bubble, and an unsustainable one at that.

Here in the Bay State, the numbers look a little better, jobs-wise, at least according to the state Office of Labor and Workforce Development, which announced last month that unemployment had actually dropped from 9.3% to 8.9%. LAWD Secretary Suzanne Bump told BusinessWest that such news is not only encouraging in that things are not getting any worse but also heralds signs of the Commonwealths climb onward and upward.

However, she added that job loss is a significant concern for the Patrick administration, and that while the state has seen some growth in key sectors health care, professional, scientific,and business services there are still some residual effects from past recessions.

Coming out of this recession, we will be regaining some jobs, said Bump. But it has taken us a long time to regain those past job losses. In fact, Im not sure that we did regain all of the jobs that we lost during the last recession of 2001-02.

For its Economic Outlook 2010, BusinessWest looks at the recession from the lens of employment, both regionally and nationally. Epstein and some his colleagues at PERI discuss the likelihood of a jobless recovery, but also about ways in which job growth can be stimulated.

Help Wanted

On the day the latest unemployment figures were released in the Bay State, Bump told BusinessWest that such numbers bode well for the states economic health.

We are as surprised as anyone by the magnitude of the drop in unemployment, she said. It is evidence that this particular recession continues to defy economic predictions.

The construction sector continues to be hard-hit, she noted, adding quickly that while this is bad news for the overall health of the states economy, that particular sector isnt as dominant an economic force as it is in other states. However, key sectors that are growth engines, as she called them, for the Bay States economy are gaining stability.

Looking at health care, she offered as one example, weve maybe missed one beat over the past year, and in general they have been in an upward trend. I think that, literally, there was one month that we saw a contraction in health care and social assistance.

The sectors that are seeing growth in Massachusetts are those that require advanced skills or education, said Bump, adding that, consequently, the Patrick administration has ambitious goals for its education-reform agenda. Citing training that leads to credentials, certifications, and post-secondary degrees as key areas of necessary spending, she said that, if we are going to grow our economy, thats what we have to focus on. Job training is not just about putting someone through a simple computer class, or giving them advanced manufacturing training.

But while Bump sees reason for optimism, Epstein and others at PERI sound far more somber notes, and on many aspects of the employment scene.

According to Jeannette Wicks-Lim, an assistant research professor at PERI and author of several books on wages and employment in the U.S., while many are understandably focused on the number of jobs lost and the potential for gains, it is also important to bracket that with the quality of existing employment nationwide.

When you dont have job growth, there is slack in the labor market, and jobs dont get wage gains, she explained. Its great that you do have a job, but if your pay is stagnating over time, then it becomes harder and harder to meet your budgets needs.

Meanwhile, Epstein, Wicks-Limm, and and Robert Pollin, co-director at PERI, say the forces, or tools, of recovery are simply not strong enough for them to express much optimism for at least the short term.

Two main tools the government has been employing to help shore up the nations stability are stimulus funding and low interest rates, which these days hover close to zero. However, some ask, if that low-interest money doesnt get into the right hands, then what is the benefit?

Its not generating real loans to small businesses, to businesses that want to borrow to invest to hire new workers, said Epstein. A lot of the money that is available right now is going into speculation thats driving up stock prices, or its going overseas and driving up the value of other currencies, but its not going into generating new jobs.

Work in Progress

Pollin said that such untapped reserves could offer a very real possibility of an immediate boost to the nations business sector those very entities who can and would contribute to increased job creation.

Theres about $700 billion sitting in bank reserves that wasnt there a year ago, he explained. Banks received all this bailout money, and now theyre sitting on it in cash; theyre not putting it out. Theres no reason to lower interest rates if the banks are just going to sit on that money.

Incentivizing the distribution of such money into the economy wouldnt cost taxpayers a single penny, he added, and loan guarantees would encourage lenders to loosen their grasp on the funds.

The government needs to create ways for loan guarantees, with other kinds of benefits, for those banks to get the money out, he said. Yes, loan guarantees have gotten a bad reputation because of TARP, but at the same time, we have massive loan guarantees in the economy, about $300 billion per year in student loans, small-business loans, agricultural loans we do have a reasonably effective system.

The way you create jobs, he continued, is to spend money.

Increased spending on jobs could very easily occur, all three professors agree, in sectors that would not migrate overseas. Echoing a sentiment often heard lately in this region, Wicks-Lim said that we know we could invest our resources in a green economy, and a lot of jobs could be created by focusing our energies there.

Pollin said a recent idea put forth by both former President Clinton and venture capitalist John Doerr has both great potential and a great name: Cash for Caulkers. Money could, and should, be invested in energy-saving building retrofits, from the highest echelons of the federal government on down to the simplest of home renovations. But, it is up to Washington, Pollin said, to lead the way.

The Pentagon itself owns 55,000 buildings in the U.S., he said. If the government just put out a procurement for those buildings, that would be an enormous stimulus, and it saves money down the line.

Pollin said he has long been an advocate of ideas like Cash for Caulkers. Ive been in debates where the questions are, is the return on investment 30%, 20%, 35%, 40%? Nobody questions that you get your money back in five years at the most. So, why arent we doing it?

He explained that the market for such large-scale retrofitting is still immature, acknowledging that it is a financial outlay for homeowners at a time when their priorities are on money coming in, not going out.

Someone once told me, we need to get to the point where we have a McDonalds for retrofits, Pollin said. You call someone, and its easy. But the only way its going to happen fast is if the government begins this massive spending on retrofits. You hire the 2 million construction workers who have been laid off in the last two years, and that will mature the market and create momentum and publicity for the private market. This could be a major undergirding for a recovery for the next few years.

Meanwhile, Epstein told BusinessWest that funds must be diverted directly to the states more effectively than has been the case. Otherwise, were going to start seeing large numbers of teachers, firefighters, and other jobs like that joining the unemployment rates, he said.

Pollin added that these jobs funded by the states are not only desirable, but non-exportable.

Just think of this reducing classroom sizes, hiring more teachers, he said. This has been a goal for 50 years, raising the quality of education. If the average size of classrooms was 25 students, what if we lowered it to 20? That would increase the number of teachers by 20%.

The Job at Hand

These are all ideas that will come up during Obamas jobs summit, said Epstein. But a comprehensive situation still needs to be addressed that will focus on employment and green initiatives, something other countries have already started doing.

Unless we pursue a green agenda, said Epstein, when we start recovering, instead of manufacturing in these kinds of products and having the R&D here, were going to end up importing it from abroad. And thats neither sustainable nor going to create jobs.

Overall, Epstein and others said the recovery, in whatever shape it takes, doesnt have to be jobless and, for the long-term health and well-being of the country, steps have to be taken to ensure that it isnt.

Advice to Residential Landlords in a Global Recession

By BusinessWest Staff December 7, 2009

Sections Supplements

Understanding Liability Issues Is a Must to Avoid Costly Mistakes

With the economy entrenched in a deep global recession, people across the economic spectrum are looking for ways to minimize expenses. Because the housing market was particularly hard-hit, there appears to be an unprecedented number of new landlords joining the ranks of seasoned investment-property owners renting to tenants.

Many of these new landlords are unable to either pay the mortgage or sell their property and are, therefore, forced to rent the property to raise some much-needed capital. For existing residential landlords, decreasing rents or income may be affecting the bottom line on the investment. Both groups, however, may be looking for ways to shave costs and raise or increase the income from properties and, in doing so, choosing to ignore some basic upkeep to their properties. This decision may prove more costly, however, in increased insurance premiums, more expensive renovations caused by delayed upkeep, and liability for injuries to people on the property.

From a liability standpoint, a recent decision by the Massachusetts Supreme Judicial Court (SJC) may give property owners pause, as the court extended another claim for liability to non-tenants. In the case of Scott v. Garfield, the SJC recognized that a claim for breach of the implied warranty of habitability could be brought not only by persons leasing and living on the property, but by lawful visitors who suffer personal injuries caused by such a breach.

As the court explained, the implied warranty of habitability is a multifaceted legal concept that encompasses contract and tort principals, as well as the State Building and Sanitary Codes. Although the warranty itself arises from the residential leasing contract between landlord and tenant, [the Court] has imposed a legal duty on the landlord, in the form of an implied agreement, to ensure that the dwelling complies with the State Building and Sanitary Codes throughout the term of the lease.

Traditionally, this implied warranty was based in part on the contract between the landlord and tenant and in part on the recognition that a tenant may recover tort damages for personal injuries caused by a breach of this implied warranty. The SJC decided to extend a claim for breach of the implied warranty of habitability to lawful visitors because of the expectation that a tenant might invite a guest into his home, and the concomitant expectation that the tenants home must be safe for a guest to visit which together go to the very heart of the landlords contractual obligation to deliver and maintain habitable premises that comply with the Building and Sanitary Codes.

Indeed, the SJC cited the State Sanitary Code as a document whose purpose is to provide minimum standards of fitness for human habitation to protect the health, safety, and well-being of the occupants of the housing and of the general public. This implied warranty would also extend to any area of the rented unit that must comply with the minimum standards prescribed by Building and Sanitary Codes. In Scott v. Garfield, the landlord could be liable to a lawful visitor who was injured by a defective porch railing.

Snow Fall

This decision comes in advance of another potential decision of importance from the SJC in the case of Papadopoulos v. Target Corp., a case that addresses a property owners liability due to a slip and fall on snow or ice. The key issue in that case is whether to maintain the distinction between natural and unnatural accumulations of snow and ice when determining the liability of a property owner. While the duty owed by a property owner to someone lawfully on the premises is one of reasonable care in the circumstances, currently the law provides that this duty is not violated by a failure to remove a natural accumulation of snow or ice.

While seemingly a clear-cut rule, courts have developed several nuances when defining the distinction between a natural and unnatural accumulation of snow or ice. Therefore, there are scores of cases discussing tire marks and ruts, trampled snow, a property owners efforts to clear snow or ice, and what activity could morph a natural accumulation into an unnatural accumulation of snow or ice. For example, where snow or ice is cleared into a pile that subsequently melts on to a sidewalk and refreezes, that refrozen surface is considered a natural accumulation. It is also unclear from the law as to what is considered clearing property and what falls short.

Indeed, in the lower courts decision of Papadopoulos case, the court engaged in this strange analysis and found that, whether the piece of ice fell from the snow pile on the median strip or melted and refroze, it constituted a natural accumulation of ice. The presence of dirt on the ice does not alter our analysis.

Evidence had shown that the parking lot where the injury occurred had been plowed, and to the left of the plaintiffs car was a raised median strip with snow piled on it. The piece of ice had either fallen off the snow pile or was created by runoff from the pile. The court, in coming to its decision, noted that the presence of dirt, without more, is of slight, if any, prohibitive value in determining how long ice, water, or other substance has been in a particular spot. This sort of language shows the remarkable intricacies that exist in examining liability in a snow-and-ice claim.

The Connecticut standard for such cases is less complicated and has been adopted by several neighboring New England states. The Connecticut rule provides that a property owner has a duty to exercise reasonable diligence in removing dangerous accumulations of snow and ice, thereby removing the distinction between unnatural and natural accumulations.

That said, the courts applying this rule have instructed that property owners can wait until the end of the storm and a reasonable time thereafter before removing ice and snow from outside walks and steps, explaining that to require a landlord or other inviter to keep walks and steps clear of dangerous accumulations of ice, sleet, or snow or to spread sand or ashes while a storm continues is inexpedient and impractical.

The effect of any change in this case law could require plaintiffs or landlords and other property owners to be more diligent about snow and take measures to ensure that all accumulations are addressed following any storm; that may include inspecting the property even after the snow or ice is initially removed. This could also include addressing the freezing, thawing, and refreezing process that naturally occurs throughout the winter.

Safety First

From a practical viewpoint, landlords should institute some very basic safeguards. First, conduct inspections of the property on a regular basis. While using a trained professional is favored, the context of this article is the global recession. As such, property owners should use their common sense: walk or inspect the property, and give it a good eye and shake test. If something is missing, moves, or presents a danger, remedy it by fixing it or hiring someone to fix it. Also, be sure to document these inspections. With the proliferation of computers, all landlords should have access to software that allows for word processing (for creating formal letters) and spreadsheets (for creating records of events).

Second, provide tenants with a mechanism for reporting problems, and, where possible, build in redundancies (such as providing phone numbers and e-mail addresses). Liability often rests on notice; therefore, the first defense to a claim is that the property owner did not have knowledge of the defect. Also, once the tenant has communicated a concern, be sure to acknowledge it and take action on that concern.

Providing open communication lines and keeping these records will also be important if the owner must evict the tenant. Under Massachusetts law, a tenant being evicted through the judicial process has the ability to counterclaim against the landlord. These counterclaims can include allegations that the propertys condition breached the implied warranty of habitability or that the property owners conduct is actionable. In these cases, the property owners ability to evict the tenant may be barred, and he can even be forced to pay the tenant. By taking the actions outlined in this article, some of these potential counterclaims can be avoided by diligence and documentation.

Finally, plan ahead, and be sure to set aside some funds for emergency purposes. Issues will inevitably occur with any property; therefore, property owners should have access to funds to at least remediate the issue.

While these changes to the law, notwithstanding the area of landlord-tenant law in general, may chill ones desire to be a landlord, the upside can be extremely positive with some diligence and common sense.

Jeff Trapani is an associate at Robinson Donovan, P.C. where he litigates a wide variety of civil cases;[email protected]

Volunteering Some Thoughts

By BusinessWest Staff December 7, 2009

Sections Supplements

York Mayo Has Made Giving Back an Art and a Science

York Mayo encourages others to put their dreams down in writing — and then be willing to do the hard work necessary to reach them.

York Mayo says it was one of the more challenging speeches hes given during what would have to be described as his second career.

The audience was comprised of roughly 50 12- to 18-year-old inner-city youths gathered at the Worthington Pond Farms in Connecuticut. I dont speak to that age group very often, said Mayo, a former executive with what is now Lenox American Saw who now carries a business card announcing him as a public speaker, advisor, mentor, and worthy grand pooh-bah. I didnt really know where or how to begin.

So he started with a question; he asked those assembled to identify the individual who started his famous speech in 1962 with I have a dream.

Everyone knew the answer, of course, and I then went on to ask them about their dreams, said Mayo. Later, when one of them guessed correctly that I was 68, I asked if someone my age could still have a dream. When they said no, it set me off like a rocket.

I told them I not only have a dream, but I have it written out something I told them they have to do, Mayo told BusinessWest, adding that whats down on paper is for him to someday, and preferably soon, become a nationally known motivational speaker. He admits that hes not doing very well in that pursuit, and for a number of reasons.

They say you need a Web site to be a national motivational speaker, and I dont have one. It also really helps to have written a book, and I havent done that yet, either, so thats two strikes against me, he said with a laugh, adding quickly that perhaps the biggest reason is that hes been too busy being those other things written on his business card.

Hes a mentor to many individuals, ranging from John Majercak, director of ReStore Home Improvement, to Angel Rodriguez, a 16-year-old student at Roger L. Putnam Vocational High School in Springfield, who Mayo has convinced to put some goals down on paper and then do the hard work necessary to meet them.

When I first him a year ago, I watched him, and I said, this kid could go either way. Hes a great talker, hes a very personable guy, a very charming guy, and a very smart person; I could see that hed be a good salesperson, or he could go the other way and be a great con man, said Mayo. I said I would be his mentor, but only under the condition that he changed a lot of the things he was doing and develop goals and a vision, which we would work on together.

He did, and they have (more on that later).

Mayo is also doing a lot of advising these days, with much of his time devoted to the building of a new Putnam. Hes the president of something called the Roger L. Putnam Technical High School Fund, which was set up to close an estimated $4 million gap between what has been allocated for the new school (projected to cost $150 million) and what it will actually cost to build the facility.

In that capacity, hes spending a lot of time talking to business owners and organizing tours of Putnam for them. The goal is to convince them to make an investment in the school, the city, the region and also their own futures in the Pioneer Valley.

When Mayo does get the occasion to speak in public, hes spending most of his time and energy convincing people in the business community to do all those things hes been doing since he retired early from Lenox in 1999. Summing up the past decade, he said hes been making himself available to serve others.

There are so many needs that are not being met by volunteers, and the government just cant do it all and shouldnt do it all, he explained. We as citizens should be setting aside a certain amount of our time every day to volunteer and serve others.

For this issue, BusinessWest talked at length with Mayo about the many ways hes giving back, and why he believes others in business can, and should, do the same.

Talking the Talk

Mayo told BusinessWest that, while he is a mentor to many, he has several mentors himself. One of them is John Davis, the former president of American Saw & Mfg. and current president of the Irene E. and George A. Davis Foundation.

Among other things, says Mayo, Davis has helped him make what he called a somewhat difficult transition from the business world to working with and for nonprofits and also having to deal with governmental bodies like school committees.

For someone like me who comes from a great company like American Saw and from the business world, dealing with the Springfield education system is very frustrating, he explained, noting quickly that, while not all businesses are run effectively, American Saw was. And to go from that culture into the education world theres a huge gap.

So I call John and spout off and say exactly what I feel, he continued. He calms me down and gives me some advice hes my mentor now, and Im glad he is.

Making this difficult transition has been part of semi-retired life for Mayo, who spent 30 years with American Saw, much of it handling international sales. He said goodbye to the corporate world in 1999, and almost immediately began making that aforementioned transition.

In 2000, he became volunteer executive director of the Greater Springfield Habitat for Humanity, and served in that capacity for more than three years. In the summer of 2005, he served as interim president and CEO of Goodwill Industries, and a year later took on that same role with Girls Incorporated of Holyoke.

With ReStore, Mayo has worked primarily on a capital campaign that began nearly three years ago. The goal was $1 million, to be used primarily to help the organization move from its current 8,000-square-foot facility to a 32,000-square-foot building, and more than $950,000 has been raised to date.

Over the years, hes volunteered time to a number of groups and causes, ranging from the Advisory Board of the Andrew M. Scibelli Enterprise Center to the ReStore capital campaign; from the Business as a Force for Social Change Program, led by Hampden County Sheriff Michael Ashe, to the Minnechaug Land Trust. Hes even found time for the Wilbraham Mens Chorus. (Mayo frequently sings to his audiences when giving speeches, and is noted for his Elvis impersonation.)

Mayo said that his top priority at the moment and the biggest consumer of his time is the Putnam High School fund, an assignment he took on at the behest of John Davis, who charged him, in essence, with getting area business leaders involved not only with the funding and construction of the new facility, but also with what will go inside the walls of the new school.

The way I describe it is bringing the business community into the school, he explained, so that it has an effect on the curriculum, the equipment, and the overall well-being of the school.

Mayo is at Putnam almost every day, with much of his time spent organizing tours of the facility that have a number of motivations, ranging from educating the business community to providing Putnam students with opportunities to gain confidence and public-speaking skills by helping to lead the tours.

The overriding goal, however, is the get businesses involved with the school, and with the education system in Springfield in general, he continued, adding that this constituency can, and should, have enormous sway over the curriculum in each program. We want business to have more of a say in this school.

The Mentor Mentality

While his work at Putnam keeps him busy, Mayo still finds the time for many other endeavors, particularly the art of mentoring.

He says business leaders should not only be mentors, but they should have at least one individual, and preferably several, mentoring them. The ReStores Majercak and Suzanne Parker, director of Girls Inc., serve as both mentee and mentor, said Mayo, adding that he has learned a great deal from both executives.

Ive learned much more from them then they have from me, thats for sure, and that fact helps explain why every leader should have a mentor theyre just invaluable, he said, adding that hes been relying on mentors all throughout his second career.

When I started at Habitat for Humanity, I had no idea about Springfield I really didnt know the difference between State Street and Main Street, he said. Why? Because I worked in East Longmeadow and lived in Wilbraham. I went to Logan, Bradley, or Kennedy; the only place I went to in Springfield was the Student Prince to entertain customers. I had no idea what was going on in Springfield or any of the politicians or how it all worked.

Fortunately, I had a great mentor, he continued, referring to Bill Mazeine, one of the founders of Bank of Western Mass., owner of a distribution company, and a strong supporter of Habitat. Every week we would meet, have a beer, and he would take a napkin and give me my marching orders.

Mayo became a mentor to Angel Rodriguez through his involvement with Big Brothers and Big Sisters.

As he mentioned, Rodriguez was at critical juncture when the two first discussed the matter of mentoring.

I remember telling him that I thought he had great potential, Mayo recalled, but the potential to either go this way, which would not be good for you or for society, or this way, which would be very good for you and very good for society.

The two sat down and wrote out some goals, said Mayo, who has his own copy. They included getting straight As the next year and earning a starting spot on the Putnam football team.

Hes not a very big guy, so I thought maybe these goals were a little unrealistic, said Mayo. But while he didnt play in the first game and didnt play much in the second, I was there to see him go out with the starting offense for the third game. It was unbelievable; he had a goal, he put it in writing, and it came to fruition.

When not advising or mentoring, Mayo is finding ways to get his message to business owners and managers the one about how they need to get involved in the community as volunteers.

Often, the comments come back to the issue of time how to find it, or make it, at a time when everyone is working harder and longer, and how to make the most of it.

Business people we generally do a lousy job of planning our time, he explained. Jim Davis [Johns father] was always talking about time, how its the precious commodity we have, and how we have to maximize the time we have in the day. Business people are filling up their calendars every day with business stuff, which is important, but we should learn to be in control of our time so we have the opportunity to serve our community.

In Conclusion

Returning to the subject of his work with young Angel Rodriguez, Mayo again stressed the importance of putting goals and dreams down in writing, thus giving them more importance and permanence.

As for his own goal thats down on paper? Well, maybe some day Mayo will become a nationally known motivational speaker. But for now, hes too busy being a mentor, advisor, and grand pooh-bah. My strategy is to take every single opportunity that I can to speak locally, and hope that leads to chances regionally and then nationally, he explained. So far, that strategy is not working at all; its mostly because Im so busy volunteering that Im not paying the attention to this that I need to.

Besides, he still doesnt have a Web site or a book with his name on the cover. He apparently doesnt have time for those, either.

George OBrien can be reached

at[email protected]

Giving Spirit

By BusinessWest Staff December 7, 2009

Features Sections Supplements

People Are Still Donating to Charity — Just Not as Much

Retail statistics for the holiday season show that Americans are still shopping despite the recession; theyre just spending less than in past years. The same trend seems to be playing out for charitable donations.

People are still giving, but theyre giving less, Roger Lowe, senior vice president of communications for the American Red Cross, told Reuters Life.

Last year, with the recession growing, donations to charitable causes in the U.S. totaled $307.6 billion, down from from $314.1 billion in 2007, according to the Giving USA Foundation, a consultancy for nonprofits. This years figures are unavailable as yet, but are expected to hover in the same area, although it typically takes six to 12 months after a recession ends for charitable giving to fully rebound, according to Charity Navigator, an independent charity evaluator.

Still, tough times seem to have reinforced peoples resolve to help others; 70% of those polled by Giving USA believe its more important to donate now, given the state of the economy. And with 80% of those polled saying they favor charities that help the poor, widespread economic hardship might be causing people to think about the plight of those even less fortunate.

The numbers also suggest that Americans are more apt this year to donate to organizations that meet needs within their own communities, rather than national nonprofits. In particular, giving to churches and religious organizations actually rose 1.6% last year.

Peter Fissinger, president of Campbell & Co., a consulting firm for nonprofits, recently used a webinar to discuss the Giving USA numbers, and found plenty to be optimistic about. For example, corporate giving was down by 8% in 2008 while corporate profits fell by 16%, and individual giving (which accounts for 75% of all donations) decreased by 6.3%, although U.S. household net worth fell nearly 18%.

When Giving Is Difficult

Wesley Watkis, managing principal and financial advisor for the W&W Group, a financial-advisory and investment firm, writes of three ways people can donate to charity during hard times and still have enough left over for themselves.

Reduce the amount, but still give. Perhaps you used to send a large check to your favorite charity, but can no longer spare the money. You dont have to give a large gift in order to make it worth the effort, however, he writes. If you can pare down your expenses to find the money, or even find $10 in a month to give, the charity will be glad to have it even that small amount can make a big difference in someones life.

Consider in-kind donations. If no amount of money is available in your budget, what about giving away some of the items clogging your basement? Watkis asks. Many charities will take donations of usable household items, which they can sell to raise cash. Be sure that you are only giving away items in good order, however, he adds. Sending broken items forces the charity to pay money to take it to the dump, and actually takes money away from the people they are trying to serve.

Time is money, too. Even if its not money or food you are giving to the food bank, for example, they still need volunteers to sort through the donations and to make packages for those in need, Watkis notes. Many other types of nonprofits are also desperately in need of volunteer help, and volunteering is a fabulous way of continuing charitable giving during a recession.

Certified financial planner John Gin recently wrote in the New Orleans-based Times-Picayune that people should always consider the laws surrounding charitable giving and try to maximize the tax benefits in order to afford higher donations. That includes giving to qualified organizations recognized by the IRS and properly documenting donations.

Gin also suggests donating stock or mutual-fund shares as one charitable option, as well as making contributions a regular part of ones budget through payroll deductions or automatic bank withdrawals.

Meanwhile, Fissingers webinar concluded with a panel discussion that produced several bits of advice for nonprofits struggling to bring in enough donations to continue their services. They include:

Stay in touch with donors, even if they cant give as much as they did at one time;

Explain to donors how their contributions impact the organizations mission;

Appreciate donors and thank them frequently;

Focus on annual gifts, major gifts, and bequests;

Tell a compelling story;

Engage donors continuously; and

Look at development as a long-term investment.

Joseph Bednar

Contractual Liability Coverage

By BusinessWest Staff November 23, 2009

Sections Supplements

It’s Not the Whole Story When It Comes to Making Sure Parties Are Fully Covered

Construction contracts usually include many provisions aimed toward transferring legal liability from one party to another. In an agreement between a general contractor and a subcontractor, the sub assumes the generals liability. The contract does this by inserting an indemnity agreement (also known as a hold-harmless agreement) into the contracts terms.

The contract may also require the sub to have the general named as an additional insured on its general liability insurance policy. Though not all contracts do this, it is a mistake for either contractor to assume that the insurance company will provide the same protection to the general without an additional insured endorsement to the policy.

Liability Coverage

The standard Insurance Services Office Commercial General Liability Coverage Form specifically excludes coverage for liability the insured assumes in a contract. However, it adds coverage back if the contract is an insured contract, as the policy defines the term. The policys definition includes hold-harmless agreements where the insured assumes anothers tort liability. That would appear to take care of the subs obligations under the contract, but it is not the whole story. The coverage may still contain a potentially large gap for the general.

It is important to keep in mind that, in any liability-insurance claim scenario, the parties fall into three categories: insurance company, insured, and claimant. A claim may involve multiple insureds, multiple claimants, or even multiple insurance companies, but all parties will fall into one of the three categories. If a party is not an insurance company and is not an insured by virtue of an additional insured endorsement, then it must be a claimant. Therefore, a general contractor in this situation becomes a claimant along with all other claimants seeking damages.

The Cost of Legal Defense

While the general contractor may receive the same recovery for damages that it might have received as an additional insured, it might not fare as well regarding the cost of its legal defense. The CGL policy pays for defense costs incurred by anyone who is an insured under the policy, and coverage for those costs is in addition to the policy limits. If the policy has a limit of $1 million per occurrence and an insured is found liable for $1 million and runs up $500,000 in defense costs, the policy pays for both in full. As a claimant, however, the general can recover defense costs only if the hold-harmless agreement with the sub requires the sub to indemnify it for defense costs.

Also, it is likely that coverage for those costs will not be in addition to the policy limits. The ISO CGL policy provides defense in addition to the limits for the general only if all of the following conditions are met:

The sub assumed the generals liability in an insured contract;

The policy covers the loss;

The sub assumed the generals defense costs in the contract;

There is no conflict of interest between the general and the sub;

Both parties ask the company to control and conduct the defense and both agree to the same counsel for defense; and

The general agrees in writing to cooperate with the insurance company in the settlement of the claim.

If any one of these conditions is not met, the company will pay the generals defense costs only until the claim exhausts the insurance limits.

Coverage for defense costs is one of the most important benefits of being named as an additional insured on another entitys liability insurance. An entity that needs this coverage should require the other contractor to provide the additional insured endorsement. Relying on the contractors contractual liability coverage is a major financial gamble.

David W. Griffin Sr. is senior vice president of the Dowd Agencies. He has more than 30 years of experience in the insurance industry. He holds his advisors license, as well as the professional designation certified insurance counselor; (413) 538-7444;[email protected]. The Dowd Agencies is a full-service agency providing commercial, personal, and employee benefits, with four offices in Western Mass.

When Opportunity Is Disguised as Anything But

By BusinessWest Staff November 9, 2009

Sections Supplements

Staying in the Market Using Active Management Is a Wise Strategy

Successful investing has never been for the faint of heart.

This has been especially true during this most recent 24-month period. Riding these recent highs and lows leaves one feeling quite dizzy. We have always maintained that a well-diversified portfolio employing high quality, active managers, coupled with a disciplined approach, will position investors favorably to take advantage of opportunities that the markets offer during periods of extreme volatility.

Last fall, when the economy and the markets came to a screeching halt, investor sentiment turned extremely negative in a very short period of time. As we then moved from the end of 2008 into the start of the new year, sentiment and the markets turned even gloomier.

Many investors could not stomach the idea of seeing their investment values decrease any further on paper; therefore, they moved to cash. These investors fled to safe havens such as cash and Treasury bills, even when doing this meant receiving no interest payments. This stampede to cash created various dislocations in the markets, or, in other words, opportunities for those investors with the fortitude to stay the course. Since this years low on March 9, when the Dow reached levels in the 6,500 range, we have seen a tremendous run up in stock prices. It is, however, very important to note that not all stock price levels have increased significantly. This highlights the importance of investing with quality managers who can identify trends and pick stocks wisely.

There are market cycles when active managers, as opposed to passive management (as in index funds), produce significant value for their investors. We believe we have entered such a cycle. Extreme volatility in investor sentiment has resulted in an unprecedented amount of cash on the sidelines (not invested in the stock market). There is currently more than $11 trillion in cash and/or money-market accounts. Eventually much of those balances will be deployed in investments with the potential for a higher return than cash and/or money-market accounts. The successful investor should already be positioned in a diversified portfolio before other investors enter the markets chasing returns as prices increase.

As financial advisors, we believe it is our responsibility to assist clients in taking as much emotion out of investment decisions as possible; following the herd is not an investment strategy. These investors who have stayed the course have been, and in our opinion will continue to be, rewarded with rebounding portfolio values.

Once again, the old adage that it is time in the market, not timing, is proving to be the successful long-term strategy. Research has shown that being out of the market for just 20 of the best market days over the last 25 years cut investor returns in half. Since none of us ever knows what the best or worst days will be until we have the benefit of hindsight, staying the course will allow investors to take advantage of opportunities that are disguised as anything but.

Lorraine A. Hart and Cheryl A. Patterson are principals of Hart & Patterson Financial Services, LLP. They are certified financial planners, each with more than 25 years of financial planning experience. Hart & Patterson Financial Services, LLP is an independent financial-planning firm with offices in Amherst and Northampton. It handles multiple facets of financial planning, including wealth management, investment management, retirement plans for businesses and individuals, estate planning, insurance services, charitable giving, and tax planning; (413) 253-9454.

Cramming for College Costs

By BusinessWest Staff November 9, 2009

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Effective Planning Can Help You Pass This Critical test

The thought of saving for college crosses almost every parents mind, sometimes even before their child is born. Yet, for various reasons, a college savings fund often does not become a reality until many years later, if ever.

Whether or not you start saving for your childs education early on, the cost of that college education will continue to increase and, most likely, more than double from the time a child takes her first step to the day she starts her freshman year.

Few would dispute the value of a college education. Aside from the personal and intellectual growth, the financial reward is undeniable. In the U.S., four-year college degree graduates earn, on average, 62% more than those with only a high-school diploma. Those with a masters degree earn almost twice as much, and those with professional degrees, over three times as much as high-school graduates. Over a lifetime, the gap in earnings between those with a high school diploma and those with an undergraduate degree or higher exceeds $1 million.

Still, the price of a degree could jolt almost anyones budget. During the five-year period ending in 2007, the nations average public and private college costs rose by 31% and 41%, respectively.

When on-campus housing, books, supplies, transportation, and other personal costs are factored in, the average cost to attend a public four-year university or college for one year is $17,336, and $35,374 at a private institution.

If that isnt enough to make you want to start saving today, consider this: students are taking an average of more than six years in public four-year colleges and more than five years in private four-year colleges to earn a bachelors degree. If these trends continue, most parents who plan to help fund their childrens education cant afford to put off saving for it.

Reducing Sticker Shock

To help you determine how much money you will need to pay for an education once your child reaches college age, there are a number of online calculators, such as those found at www.finaid.org, www.collegeboard.com, or www.nmfn.com. Unless your children are elementary school age or younger, involve them in the process to determine if they:

Plan to attend a private or public college or university, community college, or technical institute;

Want to live at home or on campus while attending school; or

May take more than four years to finish school.

It is never too early to begin saving for college. A great place to start includes any of the most popular plans used today, such as Section 529 plans, Coverdell Education Savings Accounts (ESAs), custodial accounts, and life insurance. In addition to the possible benefits of compounding, these plans may also provide great tax advantages.

Better Late Than Never

Now matter how late in the education savings game you get started, if, after factoring in the amount you already have saved, you still fall short, various options may be available, including:

Grants and Scholarships: Your child need not be a budding Einstein in order to qualify for some of the existing scholarships. Grants based on such factors as your income, place of employment, or even a relatives military service are available to qualifying individuals.

Student Loans: The Federal Student Aid Information Center provides a variety of free publications that are available by calling (800) 433-3243. The centers Web site, www.federalstudentaid.gov, allows you to complete the free application for federal student aid online. It also provides tips on reducing college costs, finding non-federal scholarships, and other helpful topics.

Home Equity Loans: In some instances, the best option to help pay for college education can be leveraging the equity in your home. Banks offer a variety of programs, from flat loans at a fixed interest rate to lines of credit that can be accessed on an as-needed basis.

Life Insurance: The cash value of a life insurance policy is one of the few assets not considered in determining eligibility for financial aid. If you have permanent life insurance, you may have an additional source of cash. Your insurance representative can help you determine how much cash is available in any policies you own as well as any potential implications that may arise.

Above all, dont be afraid to ask for advice when planning your childs education, regardless of how late you might be starting this process. Financially, emotionally, and psychologically, it is probably one of the biggest investments you will ever make.

And the impact on your childs future will last a lifetime.

John Joyce is a financial representative with Northwestern Mutual Financial Network, the networking name for the sales and distribution arm of the Northwestern Mutual Life Insurance Co.; (413) 748-6000.

Up on Main Street

By BusinessWest Staff November 9, 2009

Monson Savings Bank President Roland Desrochers

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Monson Savings Bank Continues to Grow Market Share

Monson Savings Bank President Roland Desrochers

Monson Savings Bank is a true community bank, dedicated to growing market share in and around the towns where it has a presence, and staying active in community life. But its also committed to innovations in technology and service delivery, all aimed at making customers lives a little easier.

The Monson Savings Bank boardroom now has a window several large ones, actually allowing people to look out on a downtown that has grown right alongside its namesake bank.

And even if the only recent physical expansion at MSB is the move of some executive offices and meeting space across the street from the banks longtime Main Street headquarters, President Roland Desrochers still sees plenty of room for this almost 130-year-old institution to grow.

It made sense to utilize this space available in town, so close by, Desrochers said of the move to free up square footgage in the main building. Of course, it doesnt have to be close by communication isnt a challenge these days, so to some degree, it doesnt matter where we are. But we finally have a boardroom thats not in the basement. Im sure the board appreciates that.

Indeed, with bank operations and offices bursting the banks headquarters at the seams, the relocation of some offices across the street was a no-brainer. In addition, when the U.S. Postal Service moved into a new building behind that house, Monson Savings Bank took over the former post office building nearby, giving it three locations in close proximity and some needed elbow room.

Not that growth is a bad problem to have.

This year, weve experienced 5% to 6% growth in our asset base and deposits, and we have generated most of our growth in the retail arena through the initiation of new products, Desrochers said, including First-Rate Checking, which is a high-rate savings product tied to a checking account, offering 2% interest. In this environment, where were seeing money markets paying less than one-half percent, thats a pretty good return.

Then there are Cash Back Checking, accounts that pay depositors back when they use their debit card; and NextGen banking, which targets specific age groups with different features, such as enhanced online and ATM access for college-age customers. With each one of these products, were attracting a different client base, Desrochers said.

Thats important for a bank that has adopted a strategy of building market share with just three locations Monson, Hampden, and Wilbraham in a region peppered with banks that have built branches with startling speed over the past decade. While all three locations have succeeded and grown including the newest branch in Wilbraham, which has the added challenge of doing business on the fiercely competitive Route 20 corridor the banks internal research says all have room to expand market share further, as long as MSB is nimble and responsive to what customers want.

Highs and Lows

Commercial accounts have seen similar growth, again through products aimed at making customers lives and finances easier, such as a small-business checking account that allows depositors to write 500 checks and make 500 deposits per month for free.

Then theres the introduction last year of remote capture, a technology that allows business owners to make checking deposits without visiting the bank.

That has become very popular because they dont have to worry about making deposits here; they can just scan checks in their offices. So were able to sell commercial checking accounts to customers who are not necessarily located right near one of our branches.

However, not all business is booming these days. The economy has taken its toll on commercial lending, which has been quieter than normal over the past year, Desrochers said.

We get most of our commercial-loan business through referrals from customers or maybe board members, people like that, he noted. Its quiet now, but I think youll find most banks will say theyre quiet, too. I do wonder how some businesses, especially trades, are being impacted by the economy, how many people will have issues through the coming winter.

In addition, delinquencies are up on the residential side, but its still much lower than the state average. People are definitely struggling to make payments, and a lot of people are waiting until the last day of the month, which is not something normal by any means. Were hoping we can at least control the delinquencies and work with customers to whatever degree we can. He noted that bank officials know that people are struggling, and the best way to handle problems paying bills is to keep the lines of communication open.

Burying your head in the sand is not the best way to deal with the problem, he said. Banks are willing to sit down and work with people, but they need to take it upon themselves to be proactive with their financial institution.

Banks dont want to own real estate, Desrochers continued. Look what it costs to foreclose on real estate these days $5,000 to $7,000 for a single-family home. It doesnt make a whole lot of sense to do that, so we obviously want to keep someone in their home.

Even so, Monson has seen its marketing strategies pay off on the residential loan ledger; this year, it ranks fifth in home mortgage originations in Hampden County, up from 17th just five years ago. Desrochers credits not only competitive rates for that performance, but faster turnaround times and technology like online mortgage applications again, to make the lives of customers a little easier.

BusinessWest asked whether Monsons relatively small size compared to other regional banks allows it to be more nimble in introducing such services, but Desrochers said size is really no factor.

In order to introduce new technology, things like online mortgages and mobile banking, no matter how big or small you are, you have to the spend time and effort necessary to test and implement those products, he said. You have to make the investment.

He admitted, however, that its a challenge but a rewarding one to serve customers who are far savvier and more receptive to change than in the past.

They wonder how they did without these things, he said with a smile. The whole gamut online bill pay, remote capture once customers have them, they wonder how they did without them.

Meeting Needs

Monson Savings Bank, like many community banks in the region, is well-capitalized and largely free of the bad loans that capsized the financial system last year. But the institution continues to take a cautious path, setting aside an additional $700,000 in reserve this year to cover any potential losses should the issues facing banks get worse.

Capital levels are strong right now, and the smart thing to do, seeing that, is to control growth, Desrochers said. Capital is so critical right now in this low-rate environment, and assuring a strong capital position is the most important issue until things turn around for the better.

He has never been a proponent of rapid branching out, and the current financial landscape only reinforces that notion. Now is not the time to get carried away, in our estimation. Preserving capital is critical in this type of market.

Still, that caution doesnt affect one of Monsons key roles as a community bank and that is supporting nonprofits that add to the quality of life in its communities.

Most not-for-profit organizations and schools in our market area are very pleased with how we contribute to them, Desrochers said, ticking off other beneficiaries of the banks community support, from librariers and arts groups to youth sports teams and senior centers.

Those types of organizations have had cutbacks, and we try to help, he said. We try to contribute 10% of our bottom line back to the community, which for us runs in the area of $100,000 to $120,000 a year.

That aid benefits not only small, locally based groups, but larger entities, such as the United Way, Girl Scouts, and the Red Cross, that in turn serve surrounding communities in specific ways, he said. We give back to those organizations that meet wider needs. We dont want to lose sight of that.

Its all about making a small difference in a community that can now be seen through the boardroom window.

Joseph Bednar can be reached

at[email protected]

A Bounty of Books

By BusinessWest Staff November 9, 2009

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Some Gift Offerings Are Sure to Please Your Favorite Bibliophile

Books make wonderful holiday gifts. The right tome will not only hold your interest and keep you turning its pages long after its time to go to bed, it can offer insight into the past and future, as well as invaluable knowledge about yourself, the business world, and the motivations, struggles, and strategies adopted over the course of history by individuals and companies that led to their success or downfall.

For its Holiday Gift Guide, BusinessWest takes a look at 10 popular bestsellers culled from Amazon.com, the New York Times bestseller list and Business Week book reviews that contain wisdom, pertinent history, and advice about the business and finance world.

Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System and Themselves, by Andrew Ross Sorkin. Although many books deal with how the financial meltdown came to pass or how certain companies sank or were saved, Sorkins book is different. In its 600 pages, the New York Times columnist gives readers a comprehensive look at everything that occurred, along with a plethora of details, as he chronicles the interplay between Wall Street and Washington in the eight months that brought the financial system to the brink of collapse. Before writing his book, Sorkin interviewed hundreds of people and spent more than 500 hours with top government officials. As a result, readers will feel as if they are in the rooms where significant conversations took place. The books only downfall may be that the events are so recent that theres no new news to read in its pages. (Viking, $32.95)

This Time Is Different: Eight Centuries of Financial Folly, by Carmen M. Reinhart and Kenneth Rogoff. This book, written by two economists, begins by defining exactly what constitutes a financial crisis, and how each crisis is dated from beginning to end. The award-winning tome offers a compelling, enjoyable look into modern business practices, including management, finance, and economics, as well as an 800-year history, loads of empirical data, and a comprehensive review of global financial crises. It is filled with facts about debt crises, bank runs, currency collapses, episodes of financial contagion, and much more. A great read for anyone who enjoys an academic look at history. (Princeton University Press, $35)

Getting Back to Even Your Personal Economic Recovery Plan, by James J. Cramer with Cliff Mason. In this new bestseller, the host of CNBCs Mad Money offers advice for investing in a changed market. Its the first book in which Cramer recommends specific stocks an even dozen which he says are poised to profit from the economy. The book includes 25 rules to follow in the post-crash market and is sure to encourage and inspire people still reeling from the economic downfall. The dominant sentiment in this work is that if readers do their homework, they will not just survive, they can thrive. (Simon & Schuster, $26)

Crush It Why Now Is the Time to Cash In on Your Own Passion, by Gary Vaynerchuk. This book is short, but its 140 pages contain a motivational message that tells readers it is never too late to discover their passion and turn it into cash. Vaynerchuk says that can be done by communicating ones passion through a wide variety of media outlets. His book offers more in the way of inspiration than instruction on how to succeed, but is filled with real-world insights from a man who built a business using social channels. However, readers will find concrete advice on how to create content, how to choose the right platform, and how to find people on the social Web in tune with your products or services. (HarperStudio/HarperCollins, $19.99)

How Remarkable Women Lead: A Breakthrough Model for Work and Life, By Joanna Barsh and Susie Cranston. This book is filled with inspiring stories about women who hold powerful positions. The authors spent five years researching 100 women before sitting down to write, and the result is a book that borders on the self-help category. The authors have created a system they call Centered Leadership, based on five shared traits they claim to have discovered during their interviews, which are that female leaders possess good energy management skills, believe their work is meaningful, have superior problem-solving skills, interact with numerous colleagues or mentors, and are deeply committed to their jobs. Overall, this book rates as a good read for females aspiring to be leaders in their industries or companies. (Crown Business, $27.50)

A Colossal Failure of Common Sense: The Inside Story of the Collapse of Lehman Brothers, by Lawrence G. McDonald and Patrick Robinson. This book provides especially insightful reading, as it as was written by a former Lehman Brothers insider. It offers a compelling account of failure and the dysfunction that triggered our current financial crisis. The heart of the book details McDonalds own career and takes the reader from his days as a pork-chop salesman to a man who rang doorbells to drum up brokerage clients for Merrill Lynch to making $5 million in one day. His personal history gives readers a look at life inside Lehman as well as a description of the financial products, regulatory changes, and economic environment that spawned an atmosphere rife with blunders. (Crown, $27)

How The Mighty Fall … and Why Some Companies Never Give In, by Jim Collins. This book provides questions and answers as to why seemingly solvent businesses fail, explaining that not only does it happen in stages, but declines can be reversed. Collins examines 11 companies and outlines behaviors and strategies that led them to doom. They include denial of risk and failure, an undisciplined pursuit to gain more of the market, grasping for salvation, and more, as he details just how these things occurred. The authors newest volume offers advice that could help leaders make a difference, and although its not always easy to see how Collins came to his findings, the book offers plenty of sage advice. (Jim Collins/HarperCollins, $23.99)

Lords of Finance: The Bankers Who Broke The World, by Liaquat Ahamed. This book is a cautionary tale for our times, and offers an intimate and unforgettable portrait of four men at the head of central banks who made a series of decisions that resulted in the economic collapse of the 1920s, which set the stage for World War II and created a disastrous ripple affect that lasted for decades. Filled with drama, the story analzyes the actions of Montagu Norman of the Bank of England, Amile Moreau of the Banque de France, Hjalmar Schacht of the Reichsbank, and Benjamin Strong of the Federal Reserve Bank of New York, who attempted to reconstruct the world of international finance after World War I. (Penguin Press, $32.95)

Last Man Standing: The Ascent of Jamie Dimon and JPMorgan Chase, by Duff McDonald. This book lets readers in on how one JPMorgan/Chase executive withstood the current financial hurricane and survived almost unscathed as it spins a colorful tale of the life of this 53-year-old banker who rose to the top and whose ambition was evident even at a young age. Dimons story is told in chronological order, which means readers will have to be patient before they get to the fascinating drama that took place during the last 18 months. The story shows, rather than tells, readers about Dimons scrupulous attention to detail along with his enormous ego. McDonald also shows that, although Dimon fared better than his rivals, he was inaccurate about the scope and severity of the crisis in its early days. A good read about a man whose rise and fall on Wall Street has kept him in the news. (Simon & Schuster, $28)

Behind the Cloud: The Untold Story of How Salesforce.com Went from Idea to Billion-Dollar Company and Revolutionized an Industry, by Marc Benioff and Carlye Adler. This brand-new book chronicles the story of how an idea delivering business applications as a service over the Internet was turned into a billion-dollar business, and takes readers from Benioffs beginnings as a small start-up through his unconventional strategies, struggles (especially when the company came close to bankruptcy), and the tactics that led to its survival and success. Benioff has structured the book into a series of more than 100 plays that showcase how the company stayed on the cutting edge, outwitted its competitors, and built a business with an inspiring philosophy. An easy read with lots of concrete ideas for start-up businesses. (Wiley, John & Sons, Inc. $27.95)

The Next Phase

By BusinessWest Staff October 26, 2009

From left, U.S. Rep. Richard Neal, Mayor Domenic Sarno, state Sen. Stephen Buoniconti, Robert Culver, and Gregory Bialecki celebrate the rebirth of 1550 Main.

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State, Springfield Officials See 1550 Main as a Catalyst for Further Growth

From left, U.S. Rep. Richard Neal, Mayor Domenic Sarno, state Sen. Stephen Buoniconti, Robert Culver, and Gregory Bialecki celebrate the rebirth of 1550 Main.

When Springfield and state officials gathered earlier this month at 1550 Main St., they officially announced the partnership that will keep the building occupied. But Mayor Domenic Sarno said it was more than that.

This is an investment in downtown, but also in the people of Springfield, Sarno said. The most important thing is that it stabilizes downtown and lets us continue to build on our momentum.

MassDevelopment, the Commonwealths finance and real-estate development agency, purchased the building for $2.5 million from the federal General Services Administration (GSA). The multi-million-dollar renovation efforts to follow, Sarno said, will boost surrounding property values and bring hundreds of professional people downtown every day, where theyll no doubt eat and shop. Downtown is ready to burst, he said. The glass is half-full now.

The building promises to be much fuller than that. Having previously housed federal court workers who have since moved to the new federal courthouse on State Street, 1550 Main will be occupied by three main tenants: the Springfield school department, which will abandon outdated space on State Street; Baystate Health, which will open its first offices downtown; and the GSA, which will keep several federal agencies in the complex.

Already, those lease commitments comprise 124,000 of the buildings 128,000 rentable square feet.

We did not want to see this building mothballed, said Robert Culver, president and CEO of MassDevelopment, who characterized his agencys investment as a show of confidence in the future of downtown Springfield.

Everything occurring here has been planned and committed to by the mayor, senators, and all the folks downtown, he said. This is the new face of Springfield.

U.S. Rep. Richard Neal, who also attended the recent announcement, echoed the idea of long-term planning harvesting fruit. Now we see the results of a carefully laid-out strategy for locating tenants for this building, he said.

Curb Appeal

As the courthouse project took shape on State Street, MassDevelopment investigated potential uses for the 1550 Main property, put together a development plan, and worked with the GSA to negotiate a purchase and sale agreement, then negotiated with the city, the GSA, and Baystate Health to line up leases. When buildout is complete, the school department will occupy two floors of the building, GSA will retain most of two floors for several federal agencies, and Baystate Health will occupy another floor.

Last year, Gov. Patrick awarded a $3 million Growth Districts Initiative Grant for public improvements to the buildings plaza and atrium to create safer and more attractive indoor and outdoor public spaces and to reopen the pedestrian connection between Main Street and Columbus Center.

Meanwhile, next door, the city plans to undertake major improvements to the former Asylum nightclub building, with the goal of using a portion of the building for a police substation and public offices, while clearing the rear of the site for parking and a farmers market.

I have frequently said that successful economic development takes place one block at a time, Neal said, anticipating the influx of hundreds of professionals and the projects long-term impact on Main, Worthington, and Bridge streets. It also establishes a presence for Baystate Health in the central business district, which has been a goal of mine for many years.

To Steve Bradley, Baystates vice president of Government & Community Relations and Public Affairs, relocating hospital employees downtown serves a purpose beyond simply establishing a presence there.

Were moving up to 150 employees out of hospital space that we can then use for clinical services, he said, a need that takes on special significance as the facility continues to provide care while undergoing a $239 million expansion and renovation project.

We are jammed to capacity, and we need the flexibility as the new hospital is built, Bradley said. This is a critical opportunity to relieve some of that pressure.

Mark Tolosky, president and CEO of Baystate Health, added that Baystates commitment to economic development as a tenant in 1550 Main is linked to its charitable mission, accomplished through strong partnerships in the region. The economic health of Springfield is closely linked to the health of the community, he said. By helping the city, we are helping our patients and their families, and our own employees and their families, who live and work in and around Springfield.

Gregory Bialecki, the states Housing and Economic Development secretary, said the partnership between the GSA, MassDevelopment, and the buildings tenants will be an asset to Springfields central business district and key to sustaining momentum for long-term economic development and job opportunities downtown and is just one of many such efforts his office promotes in Massachusetts.

Our strategy, he explained, is to identify communities and understand whats necessary for them to compete in a very competitive corporate world to promote economic development to have a plan and be committed to that plan, to find partners and make investments with them.

Many Miles to Go

Renovations will take place throughout the fall, with the School Department scheduled to move into its new digs in January.

This announcement is another piece of the puzzle in helping to rejuvenate our downtown corridor, Sarno said. Allowing the lights to go out at 1550 Main would have had a negative domino effect along the Main Street corridor and this is something my administration has been working hard to change.

Of course, the success of this project means other challenges await, including the potential redevelopment of the former School Department offices on State Street. Sarno said a request for proposals will be issued soon after the school systems move is completed.

Those at MassDevelopment are real believers in Springfield, Culver said, summing up the 1550 Main efforts to date. In fact, Springfield is a place on the move, and were making this a place that everyone who lives here and works here can be proud of.

Joseph Bednar can be reached

at[email protected]

Making Connections

By BusinessWest Staff October 26, 2009

MicroTek’s innovative employment model came first, its product second.

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Wire and Harness Maker MicroTek Has Found a Niche in the Nonprofit Industry

MicroTek’s innovative employment model came first, its product second.

MicroTek CEO Anne Paradis is holding up a plywood board. Its got markings on it every few inches and simple diagrams that show one where to tie and cut wires and add connectors. The straightforward visual system makes it easy for almost anyone to assemble a wire harness even someone who is learning-disabled.

Fifteen of MicroTeks 110 employees have disabilities, and the board is one of the many techniques the company uses to train and integrate those employees into its work environment.

Based in Chicopee, MicroTek, which makes custom cable and harnesses, is part of the changing manufacturing sector in the Pioneer Valley. The company was founded 26 years ago with the sole purpose of providing a meaningful workplace for people with disabilities.

I wish I could tell you it was a story about market research, but it wasnt, said Paradis about how the company got its start in the cable business.

Indeed, it was really by chance that MicroTek ended up making wires instead of, say, protein bars or womens clothing.

It all started in 1983 when about a dozen human services advocates got together. They were working in conjunction with the University of Oregon, which was researching models for employing people who were difficult to employ.

One model was to start a company where one controls the environment, provides the training, and brings in the work. It seemed like a good idea. The group just needed something to produce.

Someone at the University of Oregon happened to have a connection to Hewlett-Packard, said Paradis. That person approached the company and said, we want to start up this company. Can you help us?

Hewlett-Packard agreed and, to get things rolling, gave the young company its first commercial contracts for wire harnesses. With the business elements in place, the founders went to the Department of Developmental Services to secure additional funding.

Once out of the gates, MicroTek ran into rough seas. While the company originally hoped to hire more disabled people, it quickly realized that if it wanted commercial success, it needed a broader skill set people who could solder, read blueprints, and so on and additional customers.

For this issue, BusinessWest looks at how it all came together.

Current Events

Make this company viable.

That was the assignment given to Paradis when she was first brought on board in 1987.

She started off working for MicroTek as a marketing consultant for a year, but when it was discovered that the companys problems were worse than anybody realized, the board of directors took her on as general manager.

I had a background in human services and a masters in business administration, Paradis explained. I didnt know anything about cabling.

She was about to learn.

When you are the general manager of a small business, you are doing everything, she said. I was doing the sales, the quoting. I was covering for other managers when they werent there. I worked long hours.

Getting new business wasnt easy. Paradis had to prove to potential customers that MicroTek wasnt simply a sheltered workshop and that it was capable of producing advanced assemblies to a consistent level of quality. A helping hand came again from its number-one customer.

Hewlett-Packard lent out engineering support to get us to the next level, Paradis said. Literally, engineers would come and spend the day with us troubleshooting problems, or we would go to their facility, and they would provide training. It was a real investment in our success.

In the 22 years that Paradis has been with MicroTek, she has helped grow the company from 30 to 110 employees and from $1 million in sales to $6 million. In 2001, after outgrowing the space it occupied in an old mill building in Chicopee Falls, MicroTek moved to its current location: a $1 million, 22,000-square-foot factory at 36 Justin Dr. in Chicopee.

MicroTek makes wire harnessing, cables, and, more recently, control panels for mainly security and medical companies. Its sweet spot is low- to medium-volume assemblies, meaning anywhere from five to 25,000 of a particular item.

Our costs are competitive, said Paradis. Some people would say our nonprofit status gives us an edge, but we actually have to work harder to stay competitive, because a learning-disabled person is only 40% to 60% as productive as someone who is not.

Working with people with disabilities has additional challenges as well, such as training. One has to be able to teach skills that a disabled person can generalize over a broad range of products.

Its easy to teach someone a specific job they can do over and over again, but its harder to teach them how to use one termination machine and then do that same operation on different types of terminals, said Paradis, referring to the machines that add connectors to the end of the wires once theyve been clipped. Another terminal might look or even feel different.

The other challenge is integrating disabled people with the rest of a company. Managers want them to work as productive members of teams and remove the stigma of being disabled, explained Paradis.

Thats where the layout boards come in. A disabled worker can lay the cables out on the board and follow visual cues to know where to cut without having to continually pull out a ruler to take measurements.

We made the layout boards for people with disabilities, but then started using them for everyone, said Paradis. Because whether you have a disability or not, the board lets you work with greater efficiency and fewer errors.

Slump and Rebound

Earlier this year, MicroTek began to feel the effects of the sluggish economy, albeit a little later than most manufacturers. It cut capacity and saw sales fall by 20%, and took a temporary workforce reduction in which staff was cut back to four days a week for two months and collected unemployment for the fifth day. Ten workers also volunteered to be laid off.

But all that has changed, with the company rebounding like gangbusters, Paradis said.

We experienced a sharp decline in spring, but sales picked right back up in July and August, and we rolled back all of the cost reductions, she noted. Now were ahead of budget projections for this year a turnaround that has her feeling more confident about the health of manufacturing in general.

Meanwhile, Paradis has taken on a new mission. Our focus has shifted outward, she said. Last year, the company launched an employment-demonstration project. Its now working with several local companies to help them train people with disabilities in-house using all-natural supports.

Paradis believes that bringing in outside trainers sets up artificial barriers between the disabled person and other people in the company, which keep them from forming relationships and integrating successfully.

If there is one lesson that MicroTek has to teach, its that diversity in the workforce is what makes companies stronger.

Living Proof

By BusinessWest Staff October 26, 2009

Sections Supplements

Know the Difference Between a Residence and a Domicile

There are many reasons to consider a move to Florida, particularly later in life, the most obvious being the significant difference in winter weather between Boca Raton and the Pioneer Valley. A less obvious reason that could rival the weather in importance is tax planning in particular, income- and estate-tax planning. Indeed, if done properly, tax planning could provide that last extra bit of incentive an individual or couple needs to start spending winters in the sun.

What are the tax benefits of a move to Florida, and how are those benefits realized? Must a taxpayer sever all ties with Massachusetts, or can a taxpayer maintain homes in both Massachusetts and Florida while still reaping the tax benefits Florida offers? This article will discuss these and surrounding issues.

Why should taxes enter into the equation of whether to live in Florida for part or all of the year? The basic tax incentive is that Florida does not have an income tax or an estate tax. Also, the Florida Homestead limits the amount of real-estate tax on a primary residence in Florida and provides for much greater protection from creditors than the Massachusetts homestead exemption.

A taxpayer who is domiciled in Massachusetts (that is, whose legal residence is in Massachusetts) will pay Massachusetts income tax on his or her worldwide income. Taxation of this worldwide income may be partially or wholly avoided by a change in domicile to Florida, since Florida does not have an income tax. It must be noted, however, that even those properly domiciled in Florida will pay Massachusetts income tax on Massachusetts source income essentially, any income tied to a business or employment carried on in Massachusetts, or derived from Massachusetts real-estate rents and capital gains.

With regard to estate taxes, Massachusetts remains an expensive place to die even for the moderately wealthy. The Massachusetts estate tax filing requirement is $1 million. Estates of less than $1 million are not required to file a return or pay a tax; however, estates over $1 million will pay a tax on the entire estate, not just the amount exceeding $1 million. (For comparison purposes, the federal estate-tax shelter for 2009 is $3.5 million, and Connecticuts shelter is slated to rise to $3.5 million in 2010). Florida has no state estate tax. For example, a $1.2 million Massachusetts estate will incur an estate tax of $45,200, while the same estate in Florida will incur no estate tax. Taxpayers properly domiciled in Florida, however, will pay Massachusetts estate tax on real estate and tangible personal property located in Massachusetts. Careful planning for those domiciled out of state is necessary to avoid a backdoor Massachusetts estate tax on those assets. Thus, a change in domicile from Massachusetts to Florida (or a similarly tax advantaged state) could result in significant tax savings.

The Massachusetts Department of Revenue (DOR) will look at each particular case to determine if the taxpayer at issue is domiciled within or outside of Massachusetts for tax purposes. The analysis is fact-based and undertaken without regard to federal law or the law of any other state.

Before proceeding, however, some basic definitions are in order. At issue in the DORs analysis is the legal status of a taxpayers domicile, as distinguished from his residence. A taxpayer may have many residences homes in Massachusetts and Florida, for example but has only one domicile. A taxpayers domicile is the residence the taxpayer regards as his or her true home or principal residence. As reiterated in numerous cases decided by the Massachusetts courts, domicile is the place of actual residence with the intention to remain permanently or for an indefinite time and without any certain purpose to return to a former place of abode.

So how does a taxpayer convince an auditor, the DOR, and, if necessary, the Appellate Tax Board that the taxpayer has relocated his or her domicile outside of Massachusetts? There are some hard and fast rules that provide a starting point for the analysis. The first and most important rule is to have an actual home either rented or (preferably) owned in the state where the taxpayer is attempting to prove domicile (in this case, Florida). Domicile requires, at minimum, an actual residence, and Massachusetts courts have stated that a person can have a home in a place where he is not domiciled, but he cannot be domiciled in a place where he has no home. While this seems obvious, a taxpayer recently lost a case before the Appellate Tax Board partly on the basis of a Florida lease that lapsed while the taxpayer paid an extended visit to Massachusetts.

The fact of having a home in the place of domicile must concur with the intent to make that home the taxpayers domicile as opposed to a mere residence. This is where the DORs inquiry will become highly fact-intensive, and where careful planning becomes essential. As the DOR has stated, the most persuasive indicators of domicile are the physical, business, social and civic activities of the taxpayer. Taxpayers must demonstrate that the center of these activities occurs at their new domicile. The level of steps that must be taken varies based on whether or not the taxpayer will maintain a home in Massachusetts. How is this accomplished?

Regardless of whether the taxpayer will continue to maintain a home, business, or social contacts in Massachusetts, the following steps should be taken to demonstrate intent to change domicile to a different state:

registering to vote and actively voting in the new state, and simultaneously terminating Massachusetts voting registration;

changing vehicle registrations to the new state;

obtaining a drivers license in the new state and terminating the Massachusetts license;

keeping all primary bank accounts in the new state and maintaining as few ties to Massachusetts banks as possible;

changing addresses for bills, including credit-card bills;

changing addresses for magazines;

changing the address on ones passport; and

joining clubs and undertaking other social activities in the new domicile and resigning or changing Massachusetts memberships to non-resident status.

The taxpayer should also file a declaration of domicile and citizenship, in duplicate, with the clerk of the circuit court in the county of residence of the new domicile.

Finally, the taxpayer should release any homestead exemption applicable to his or her real property in Massachusetts and file for homestead protection in Florida. Note, however, that the taxpayer must own Florida real estate on Jan. 1 of the year in question and make that property his or her principal residence in order to qualify for the Florida homestead protection.

There are several additional considerations if the taxpayer is maintaining a residence in Massachusetts. Massachusetts considers that a taxpayers legal residence for tax purposes will be Massachusetts, even if the taxpayer is domiciled in another state, if the taxpayer maintains a permanent place of abode in Massachusetts and spends more than 183 days (including partial days) in the aggregate in Massachusetts during the year. If both of these criteria apply, the taxpayers efforts in establishing domicile outside of Massachusetts will be for naught.

The surest way of avoiding the application of these rules is to spend 183 days or less in the aggregate in Massachusetts during each tax year in question. The Department of Revenue, however, will not simply take the taxpayers word on whether he or she spent more or less than 183 days in Massachusetts. The taxpayer should maintain detailed records to prove the amount of time spent within or outside of Massachusetts.

In an audit, the Department of Revenue will demand copies of all monthly credit-card statements, phone bills, and bank-account statements for the year(s) in question as evidence of location during the tax year(s). Consequently, the taxpayer should use a credit card regularly while outside Massachusetts and keep copies of all credit-card bills and bank-account statements.

The taxpayer should keep receipts indicating where items were purchased for non-credit-card transactions. If the taxpayer spends considerable time outside of Florida, the taxpayer can use evidence of credit-card charges or similar means to explain the taxpayers location and rebut the Department of Revenues assumption that the taxpayer was in Massachusetts. The taxpayer should keep all airline tickets, indicating dates of stay within and outside Massachusetts, and should keep a journal of all dates spent in Massachusetts.

If the taxpayer is unable to limit his or her time to 183 days in Massachusetts, then the taxpayer will need to establish that he or she maintains no permanent place of abode in Massachusetts. A permanent place of abode is a dwelling continually maintained by a person, whether or not owned by the person, and includes a dwelling owned or leased by the persons spouse. This definition will encompass most homes maintained in Massachusetts by those domiciled elsewhere.

The Department of Revenue does maintain a list of very narrow specifically delineated exceptions to the definition of a permanent place of abode. Under these exceptions it is very difficult for the owner of a home in Massachusetts to avoid that home being treated as a permanent place of abode. Having children or grandchildren move into the home will not suffice; nor will renting out the property for less than a term of one year. The only rental exception that the Department of Revenue recognizes with regard to the permanent place of abode definition is a full rental of the property at issue to a non-related individual, for a period of at least one year, where the taxpayer has no right to occupy any portion of the premises during the lease period.

As a practical matter, therefore, taxpayers who wish to maintain a home in Massachusetts yet receive the tax benefits of having a domicile outside of Massachusetts will need to prove that they have spent more than 183 days outside of Massachusetts and that they have established a domicile outside the Bay State.

For taxpayers who maintain homes in Massachusetts, there are often continuing ties to Massachusetts beyond the maintenance of real estate. These may include, for example, visits to children and grandchildren living in Massachusetts and continuing social, legal, financial, and business relationships with friends and advisors in Massachusetts, as well as receiving specialized medical treatments in Massachusetts. The Appellate Tax Board has recognized that such ties may exist, and that they do not defeat a change in domicile. As the Board has stated, continuing ties to [Massachusetts] do not foreclose a finding of change of domicile: such change does not require that a taxpayer divest himself of all remaining links to the former place of abode, or stay away from that place entirely.

The taxpayer should apply common sense in such situations. Items near and dear to the heart of the taxpayer should, to the extent possible, be located at the new domicile. Department of Revenue auditors will look to determine where the taxpayer centers his or her life in determining the taxpayers intent.

In a recent case, the Appellate Tax Board overruled the Department of Revenue and held for a taxpayer who had maintained social ties to Massachusetts. The Board noted the taxpayer couples joining a church in Florida, becoming members and eventually directors of their neighborhood housing association, their development of a large circle of friends in Florida, and their attendance at local Elks and Moose lodges in Florida in rebutting the DORs argument that the taxpayers social ties to Massachusetts prevented a change in domicile. When combining these facts with the necessary changes in the taxpayers drivers licenses, voter registrations, and similar items, the Appellate Tax Board concluded the taxpayers had indeed changed their domicile to Florida.

This article is not meant to provide a full guide to a successful, tax-advantaged change of domicile outside of Massachusetts. As discussed above, even those who successfully change their domicile will still face tax issues in Massachusetts, many of which can be minimized or perhaps eliminated with proper planning. It is therefore essential for any taxpayer seeking to realize tax benefits in conjunction with a change of domicile to consult with his or her advisors to determine the feasibility of such a move, its chance of success, and the methods of maximizing the potential benefits to the taxpayer.

Michael Simolo is an associate with the law firm of Robinson Donovan, P.C., specializing in estate planning, estate and trust administration, fiduciary litigation, and business law; (413) 732-2301.

Breaking No New Ground

By BusinessWest Staff October 26, 2009

A.J. Crane says building opportunities still exist right now, but contractors must stay flexible.

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Area Builders Face Dwindling Job Opportunities, Stiffer Competition

A.J. Crane says building opportunities still exist right now, but contractors must stay flexible.

When David Fontaine surveys the construction landscape in Western Mass., he doesnt like the little that he sees.

Unfortunately, this is the slowest weve been in at least 30 years, said Fontaine, president of Fontaine Brothers in Springfield. And its not for a lack of effort; we just cant seem to get the low bid.

Part of that is the intense competition that has arisen to procure a dwindling number of available projects as the recession lingers. In the most recent project we bid for, there were 18 bids. Its just something weve never encountered as long as weve been here.

Richard Aquadro, president of Aquadro & Cerruti in Northampton, has witnessed the same phenomenon.

Its brutally competitive, a very tough environment, he said. Last year wasnt bad, even though the economy wasnt great then, either. We did more volume last year than we had the previous two years. We lucked out, hit some good jobs, and did a fair amount of volume. But 2009 has been tough.

There are fewer jobs in what I call my market, Aquadro added, noting that he typically tackles projects between $5 million and $30 million. I see the bigger players chasing them and, surprisingly, getting some of them. They generally have more overhead, but theyre taking the jobs for nothing.

Its a common refrain these days, as builders across the Pioneer Valley struggle to keep their machines moving and income flowing and no one has a clear idea of when opportunities will pick up again.

One Job at a Time

A.J. Crane, operations manager for A. Crane Construction in Chicopee, said his small firm is weathering the storm, thanks to an effective network of relationship marketing that relies on repeat business and word of mouth.

It reflects the time weve put in, not with just cold calls or advertising, but more personally reaching out to people. Its tougher now. Youve got to sharpen your pencil.

Indeed, Crane said nailing down commitments has become more difficult as customers increasingly realize that theyre in the drivers seat.

We never had to quote much, he said, but people know the way things are now, and they know that contractors are hurting.

Some builders, Crane said, are cutting corners by not carrying insurance, which makes it more difficult for those who do.

I think people realize the value of being covered, he said. Someone who doesnt do that can fly under the radar. But we spend $2,000 a week on insurance, and there are still customers out there that appreciate that.

In these times, Crane said, it helps to be willing to take jobs of any size. The company is building a 5,200-square-foot home in Sturbridge and undertaking a $70,000 kitchen remodel in Ludlow, but is also taking on much smaller-scale work as opportunities arise.

We dont limit ourselves, he said. Were not above doing storm doors. And I think it hurts a lot of guys when they dont want to take small jobs.

Flexibility has long been a plus in construction, to insulate builders from slowdowns in particular industries, said Aquadro, who has tackled major jobs ranging from hospitals and schools to parking garages and athletic fields, and everything in between. But diversity has its limits, he said.

What has happened in the industry is that some jobs are being handled differently, Aquadro said, explaining that, as opposed to the hard, competitive bids of the past, theyre now being handled through an RFP [request for proposal] process, where you submit qualifications, fees, things like that. And you have to have a certain number of jobs similar to the one theyre proposing to do. So as opposed to being diversified and being able to do a lot of different things, its almost becoming a specialized market.

Colleges have always pumped a steady stream of jobs to area builders; Fontaine recently began work on Western New England Colleges new School of Pharmacy, for one, and noted that WNEC has always been willing to take advantage of a down market.

On the other hand, outside of education, it does seem like the private sector is pretty quiet, he said. The public sector is quiet, too, although bridges and roads seem a bit busier. Driving down the Mass Pike or the 91 corridor, theres a lot of activity.

Uncertain Outlook

Overall, however, the picture remains cloudy for area contractors. Some ongoing work for Aquadro & Cerruti at Amherst College was recently put on the back burner not an uncommon story for builders during uncertain economic times.

In some respects, theres not enough work on the ground for everyone, Aquadro said. Competition has always been keen in the Valley.

The difference now is that larger contractors are moving aggressively to pick up mid-range jobs, which has forced the company to adjust its strategy. Were forced to bid in smaller projects against smaller companies that have less overhead and may not have the labor-union agreements we have, which makes it even more difficult to bid.

I see us just trying to get through 2010, said Fontaine, who doesnt foresee a huge upswing in businesses undertaking new construction projects for the time being. There are a lot of studies out there, but it takes a good year before a study gets turned into work for a tradesperson.

In other words, theres not much to build on right now.

Joseph Bednar can be reached

at[email protected]

Lien and Mean

By BusinessWest Staff October 26, 2009

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Knowing the Rules Can Help Ensure That You Get Paid for Your Work

While receiving payment for a project has always been a challenge, in todays economic environment, it is getting even more difficult. In order for a contractor (whether a general contractor or a subcontractor) to ensure payment, he must move quickly to perfect his mechanics lien rights. Just like the old saying goes, if you snooze, you lose.

Mechanics liens in Massachusetts are governed by M.G.L. c.254, which covers liens by contractors and subcontractors. Strict adherence to the statutory requirements is essential, and all too often, mechanics lien rights are lost to minor deviations.

A contractor must record a notice of contract in the Registry of Deeds for the county in which the property is located in a timely fashion in order to assert his statutory right to a mechanics lien. The notice of contract must be recorded within a certain period of time, beginning any time after execution of the written contract and ending at the earliest of (1) within 60 days after filing a notice of substantial completion; (2) within 90 days after the filing of a notice of termination; or (3) within 90 days after the contractor last performed or furnished labor and/or materials to the property.

The enforcement of the lien requires additional actions. First, a statement of account must be recorded in the Registry of Deeds. This must be filed the earliest of (1) 90 days after filing the Notice of Substantial Completion; (2) 120 days after the filing of the notice of termination; or (3) 120 days after the last day labor was performed or material was delivered to the site. For a contractor, it is the last day he performed services or delivered material. For a subcontractor, it is the last day he performed services or delivered material, or the last day the general contractor did the same.

After recording the statement of account, a civil action must be filed in Superior Court (the county where the land lies) or District Court (the district where the land lies) within 90 days of filing the statement of account.

Once the complaint is filed, there is a final step that must be taken to execute the lien. The contractor or subcontractor must record in the Registry of Deeds an attested copy of the complaint within 30 days of filing it.

The theory of equity is not used in mechanics lien cases. The timelines stated in M.G.L. c. 254 are absolute and cannot be extended by the court, and there is no exemption for oversight or neglect.

In order to establish a lien under as a general contractor or subcontractor, there must be a written contract. In the case of a contractor, the written contract must exist with the project owner. In the case of a subcontractor, a written contract must exist between the subcontractor and the general contractor. If there is no written contract, the lien is invalid. M.G.L. c.254 defines what constitutes a written contract as any contract in writing enforceable under the laws of the Commonwealth.

One loophole allows a lien without a contract, but it is applicable only to a person who actually performs services, not one who supplies material. This type of lien usually arises on small, informal projects where there are no written contracts. A statement of account must be filed within 90 days of filing the lien, and that lien covers only up to 30 days of work performed prior to the recording of the statement of account.

In Massachusetts, it is illegal for a project owner to require a contractor or subcontractor to execute a blanket lien waiver prior to performing their services. This means that a project owner cannot require a contractor or subcontractor to agree that they will not file a lien upon the property. However, they can require such a waiver at the time of payment.

In short, M.G.L. c 254 can be a powerful tool in collecting payments. However, like any tool, it must be used by an experienced operator. Just like when youre on the job site, a seemingly minor mistake can have catastrophic consequences. n

Adam J. Basch, Esq. is an associate with Bacon Wilson, P.C. He is a member of the litigation department with expertise in the areas of construction litigation, personal injury, general litigation, and creditor representation; (413) 781-0560;[email protected]

Wine and Dine

By BusinessWest Staff October 12, 2009

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Stop Telling and Start Selling

By BusinessWest Staff October 12, 2009

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These Five Steps Will Have Recruiters Thinking Like Salespeople

A great recruiter should have the same skill sets and qualifications of a great salesperson. All of the great sales visionaries, including Zig Ziglar and Tom Hopkins, have taught these steps to sales professionals around the world, yet few recruiters today understand or use any of these available resources.

So much emphasis has been placed on prospecting or sourcing potential candidates that recruiters are not taught the basics of the sales process that follows the sourcing function. Having listened to thousands of third-party and corporate recruiters over the past 15 years, my sense is that fewer than 10% of recruiters understand basic sales principles.

Although the terminology may differ, the following are the critical steps to every successful sales professional or recruiting professional.

1. Developing the Relationship

This is the time that the warming-up events occur, before the serious selling begins. This includes how you introduce yourself and how you begin the conversation. Candidates have stated that its during the first two minutes of the call that they form crucial initial impressions that influence the rest of the recruiting process.

2. Creating/Identifying the Need

Every sale involves asking questions to identify a need of which the candidate is often unaware. This is much more than a simple collection of data. Identifying or creating the need is the most important of all selling and recruiting skills. Recruiters who are the most effective during this investigative stage are most likely to be the highest performers. Recruiters with poor investigative skills generally create candidates who ultimately do not accept the position once its offered.

3. Preventing/Overcoming Objections

Although objections are inevitable in any sales process, the key for successful sales professionals and recruiters is actually preventing objections. By asking the right types of questions in step 2, many objections that would have arisen in the process are addressed before the candidate has an opportunity to bring them forth. Keep in mind that some objections are inevitable, that they are often training responses, and that most are emotional and not practical.

4. Filling the Need/Providing Benefits

Identifying the need is considered the most crucial skill in sales or recruiting; filling the need is the second-most critical step to ensuring success. Often recruiters and sales professionals alike pay little attention to step 2 and focus solely on step 4.

Like many sales professionals, recruiters often focus on what is commonly known in sales language as their product knowledge. They have an in-depth understanding of the organization they are recruiting for, they understand every detail of the position and its function, and they completely understand the requirements of the role. Armed with all of this product knowledge, these untrained recruiters contact potential candidates and attempt to tell them about every benefit of the position and company they represent, never addressing the real needs of the candidate. This is a common mistake made by most sales professionals.

5. Advance/Close the Sale

In recruiting and sales, advancing the sale is the final objective throughout every step of the process. By filling the need in Step 4, you are in a position to advance the sale to the next step. In recruiting, closing is most commonly compared to presenting the offer and gaining acceptance from the candidate. At this stage recruiters often focus on the practical aspects of the offer being made: compensation, benefits, perks, etc. Effective recruiters and sales professionals alike understand the importance of re-emphasizing the emotional drivers identified in Step 2 of the sales process prior to presenting the practical aspects of the solution.

Bottom Line

Although these five steps are critical to the success of every recruiter, most focus and are trained only on steps 1, 4, and 5, skipping the most important step: identifying the need. Recruiters like to tell about the great position, company, and opportunity that they currently have without having asked any questions to identify the needs of the potential candidate. This telling, not selling approach continues to be prevalent among the majority of recruiting organizations, minimizing the benefits of sourcing tools, branding, and recruiting technology available today.

The profile of todays recruiter must also change. An effective recruiter should be seen as a sales professional who exemplifies the ability to develop candidate relationships, identify candidate needs, overcome or prevent objections, fill the candidates needs, and advance the sales process. Recruiters need to be given the appropriate training to move from telling about their opportunity to actively selling it. n

Stephen A. Lowisz is president and CEO of Qualigence, the recruitment research firm he founded in 1999. His career encompasses the recruiting industry, specifically passive candidates. An industry expert, he is a highly-rated speaker for leading HR industry events and conferences, an educator/trainer of the Answer Passive Candidate Recruitment Training, and a speaker/consultant for several Fortune 500 organizations each year;www.qualigence.com

Make It Policy

By BusinessWest Staff October 12, 2009

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How to Battle Corporate Fraud and Balance Employer Security with Employee Privacy

Combating corporate fraud and striking a balance between employer security and employee privacy is no easy task, but it can be accomplished when an employer communicates its corporate culture through specific policies and procedures. That being said, these policies must clearly convey the expected behavior of employees. In short, the purpose of all company policies is to protect both the company and its employees in situations where it appears that something may have gone wrong.

Policies can address a variety of areas, including company property, data security, expectation of privacy, and even an employees responsibilities for reporting to management known violations of the employers policies and/or illegal acts. They can range from a general code of conduct or code of ethics policy to certain general personnel policies, addressing issues such as basic travel reimbursement or the employers position on fraud and use of the companys IT resources.

Battling fraud and balancing employer security with employee privacy are key areas that warrant specific policies. Every employer should consider establishing and implementing these policies to strengthen its company culture, set the tone from the top, and ensure that employees are acting in ways that do not put the company at risk.

Create a Fraud Policy

Although a significant number of employers have a code of ethics or code of conduct, these policies rarely address fraud specifically or in adequate detail. Therefore, every employer should have a separate fraud policy. This policy details clearly the employers position regarding fraudulent activity, defines what is considered to be fraudulent activity, and communicates the consequences to the employee if they are found to have engaged in any fraudulent activity.

A fraud policy also speaks to employees about their responsibility to identify and communicate to the appropriate level of management if they suspect or are aware of fraudulent activity. The policy is not meant to list all possible examples of occupational fraud, but to provide information to employees that will clarify activities that may not always be viewed as fraud. Examples of these activities include such things as:

Putting time on a timesheet/card that the employee did not work;

Putting expenses on expense and travel reimbursements that are not for the proper amount or for company business; and

Personal use of company equipment and office supplies.

In addition, the policy should communicate zero tolerance for fraudulent activity along with the possible consequences, including immediate termination.

Finally, a fraud policy should be included in or with the employee personnel polices provided to a new employee. As with all personnel-related policies, the company should have a signed document from the employee stating they have received and read the company policies.

In general, employees have a duty to cooperate during an internal or other investigation as long as what is requested from them is reasonable. This duty varies state to state and is affected by statutory and common law.

Employer Security vs. Employee Privacy

There are other employer policies that collectively are critical to avoid potential problems in the event of internal investigation or workplace search. All these policies have one thing in common, in that they reduce the employees expectation of privacy.

The expectation-of-privacy issue relates primarily to workplace searches. These expectations cannot be lowered to zero by policies but can be reduced to a significant degree. There is no bright light or safe harbor to determine if an employee has a reasonable expectation of privacy for a particular area. Some of the policies that will lower the expectation include the following:

Information system security guidelines (computer use policy);

Internal and e-mail use policy (including employer monitoring); and

Personal communication devices (company cell phones and PDAs) and voice-mail policy.

Personnel policies should be adopted to provide that, in order to maintain the security of its operations, the employer retains the right to access and search all work areas and personal belongings, including desks, file drawers, briefcases, handbags, pockets, and other personal effects.

In addition, the expectation of privacy is lowered when the employee is not granted exclusive control over an area. By eliminating the control, the expectation of privacy is diminished. In addition to the policy addressing the employers right to access these areas, the employer should have keys to the office, cabinets, desk, etc. The employer should require employees to provide keys to personal locks. Again, this clearly demonstrates that the employee does not have exclusive control.

These policies should also address the fact that workplace areas are subject to surveillance and that business calls may be monitored. As indicated above, the company policies should state that the employer can monitor all electronic communications, including which sites are visited over the Internet.

It is also important that the employer enforce these policies when violations are noted and enforce consistently for all known violations.

The issue of reasonable expectation of privacy is a complicated one with many variables and situations. It is strongly recommended that, before an employer conducts a search or surveillance, the employer consult legal counsel to ensure they are not violating an employees privacy. It is also recommended that, when an employer develops and implements the policies recommended here, they have legal counsel review them in advance of implementation.

Issues regarding employer/employee rights in the workplace are certainly a complex area. By combining clear employer policies and appropriate consultation with legal counsel when issues arise, an employer can protect its ability to maintain the security of its operations. n

Joseph Centofanti is a member of the firm and the leader of the Government Services Group at Kostin, Ruffkess & Co., LLC, a certified public accounting and business advisory firm with offices in Springfield, and also Farmington and New London, Conn.;www.kostin.com

The Super 60

By BusinessWest Staff October 12, 2009

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Depth and Diversity of the 2009 Winners Offer Some Things to Celebrate

The Affiliated Chambers Super 60 lists have consistently reflected the strength and diversity of the regions economy, and the Class of 2009 is no exception. The Total Revenue and Revenue Growth compilations both display well-performing companies in sectors ranging from health care to manufacturing; service to education; retail to technology.

COMPANIES BY TOTAL REVENUE	OMPANIES BY REVENUE GROWTH
Whalley Computer Associates Inc.	R & R Industries Inc.
Savage Sports Corporation	Western New England College
Springfield College	Spectrum Analytical Inc.
Associated Electro-Mechanics Inc.	American Pest Solutions Inc.
Braman Termite & Pest Elimination	Axia Insurance Services Inc.
Center for Human Development	Bern Optics Inc.
City Tire Co. Inc.	Communication Solutions Partners Inc.
Court Square Group Inc.	Custom Carbide Corp.
The Dennis Group, LLC	The Delaney House
Disability Management Services Inc.	Dimauro Carpet & Tile Inc.
Environmental Compliance Services Inc.	Edizen
Insurance Center of New England Inc.	Emergency Medicine Solutions LLC
Joseph Freedman Co. Inc.	FieldEddy Insurance
Kittredge Equipment Company	Footit Surgical Supplies Inc.
Kleer Lumber, LLC	Gandara Center
The Log Cabin Banquet & Meeting House	The Gaudreau Group
Marcotte Ford Sales Inc.	Haluch Water Contracting Inc.
Maybury Material Handling	Innovative Business Systems Inc.
Mental Health Association Inc.	Jet Industries Inc.
Parts Tool & Die Inc.	McGill Hose & Coupling Inc.
Rediker Software Inc.	Millrite Machine Inc.
Rocky’s Hardware Inc.	Moriarty & Primack P.C.
Tighe & Bond Inc.	Proshred Security International Inc.
United Personnel	Robert F. Scott Co. Inc.
University Products Inc.	Savage Sports Corporation
Valley Communications Systems Inc.	Sullivan & Associates Inc.
W.F. Young Inc.	Tech Roofing Service Inc.
West Springfield Auto Parts	Wegrzyn Dental Group
YMCA of Greater Springfield	Whalley Computer Associates Inc.
YWCA of Western Massachusetts	Whalley Precision Inc.

Russ Denver says the Super 60 recognition program has never been about five dozen companies celebrating their individual success in a given year.

OK, its not just about that, said Denver, president of the Affiliated Chambers of Commerce of Greater Springfield, which oversees the program. He noted that some firms or the accounting firms that nominate them want to tout their accomplishments and solid growth rates. From a big-picture perspective, the program, now 20 years old and expanded from what used to be called the Fabulous 50, is a celebration of what the 60 firms collectively represent.

Specifically, they connote strength and diversity, said Denver, and plenty of that will be on display at the annual Super 60 luncheon and Recognition Program on Oct. 23 at Chez Josef in Agawam.

Virtually every sector of the economy is represented on this years list, from manufacturing to service; financial services to health care; technology to education. A quick look at the list shows companies and institutions ranging from Springfield College to the Rockys Hardware Chain; from McGill Hose & Coupling Co. to the YWCA of Western Massachusetts.

Theres an old saying about there being strength in numbers, said Denver. Theres certainly strength in these numbers from the list of business sectors represented to the totals for revenue to the average growth rates for the winners in that category.

That revenue figure exceeds $1 billion again this year, said Teddy Woeppel, communications director for the AGGCS, noting that average revenues for all applicants was $19 million, while for the top 30, they exceeded $32 million. As for growth, the numbers were again solid, especially given the economic conditions, she said, adding that the average for all participants was 25%, while for the winners, it was more than 40%.

Breaking down the lists further, Woeppel said two companies, Whalley Computer Associates Inc. in Southwick and Savage Sports Corp. in Westfield, qualified in both categories. Meanwhile, 65% of the winners were ACCGS members, with 22 belonging to the Springfield Chamber, nine to the West of the River Chamber, and eight to the East of the River 5 Town Chamber.

The top three finishers in the Total Revenue category were Whalley Computer Associates, Savage Sports, and Springfield College. On the Growth side of the ledger, the top three finishers were R & R Industries, Western New England College, and Spectrum Analytical. Beginning on page 16, BusinessWest offers brief snapshots of each of the 60 companies on this years lists.

The Oct. 23 luncheon will begin at 11:30 a.m. It is being sponsored by Health New England, Hampden Bank, Sullivan Hayes & Quinn, Nuvo Bank & Trust Company, and Zasco Productions. The keynote speaker will be author and customer-service expert Dennis Snow, who spent more than 20 years working for the Walt Disney Company in customer service and is now a full-time motivational speaker, trainer, and consultant.

Supplements

Karoun Yoga Meets a Need in Springfield — for the Gift of Peace and Silence

Mary’s Meadow Touts an Innovative Small-home Model of Nursing Care

It’s Real, and Its Impact Can Be Severe; How to Avoid the Epidemic

You Don’t Need a Crystal Ball to Figure Out What They’re Thinking

Recently Enacted Legislation Has Provisions That Impact the Bottom Line

Department of Labor Is Viewing Most Internships as Employment Arrangements

John Ratzenberger Brings His Summer-camp Initiative to STCC

How Best to Develop a Corporate Strategy That Generates Results

Dynamic Keynoters, Networking Event on Tap for Market Show 2010

Commercial-loan Market Remains Sluggish

Women Presidents? Organization Provides a Forum for Growth

A list of exhibitors taking part on May 5

It’s Good for Public Relations, Good for the Bottom Line

Year-end Is a Time for Businesses to Focus on Planning, Improving

Springfield’s ICT Center Forges Connections in a High-tech Global Marketplace

AirPark South in Chicopee Will Give the Region Inventory, Flexibility

The Economy Is Improving, but Where Are the Jobs?

Understanding Liability Issues Is a Must to Avoid Costly Mistakes

York Mayo Has Made Giving Back an Art and a Science

People Are Still Donating to Charity — Just Not as Much

It’s Not the Whole Story When It Comes to Making Sure Parties Are Fully Covered

Staying in the Market Using Active Management Is a Wise Strategy

Effective Planning Can Help You Pass This Critical test

Monson Savings Bank Continues to Grow Market Share

Some Gift Offerings Are Sure to Please Your Favorite Bibliophile

State, Springfield Officials See 1550 Main as a Catalyst for Further Growth

Wire and Harness Maker MicroTek Has Found a Niche in the Nonprofit Industry

Know the Difference Between a Residence and a Domicile

Area Builders Face Dwindling Job Opportunities, Stiffer Competition

Knowing the Rules Can Help Ensure That You Get Paid for Your Work

These Five Steps Will Have Recruiters Thinking Like Salespeople

How to Battle Corporate Fraud and Balance Employer Security with Employee Privacy

Depth and Diversity of the 2009 Winners Offer Some Things to Celebrate

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