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Class of 2020 Special Coverage

2020 40 Under Forty Virtual-Hybrid Celebration
Tues., Oct. 13 & Wed., Oct. 14, 2020

Scenes from Tuesday's 4 PM Event

Scenes from Tuesday's 6:30 PM Event

Scenes from Wednesday's 4 PM Event

Scenes from Wednesday's 6:30 PM Event

Amid new restrictions imposed by the governor on large gatherings and with a strong desire to keep everyone safe, it was decided that the most prudent course was to instead celebrate our honorees’ accomplishments with a hybrid platform.

The hybrid event has been spread out over two days on Tues., Oct. 13 and Wed., Oct. 14. Each “mini-event” will allow 10 honorees to celebrate in person at the Upper Vista of the Log Cabin. For those who can’t join us in person, we’ve created a livestream option so friends and family can cheer on the Class of 2020 from the safety and comfort of their home. The new two-night ‘Virtual Access Pass’ allows you to see all 40 of this year’s honorees accept their awards on Tuesday, Oct. 13 and Wednesday, Oct. 14!

The 40 Under Forty program for 2020 is sponsored by PeoplesBank and Health New England (presenting sponsors); Comcast Business, Isenberg School of Management, and Mercedes-Benz of Springfield (sponsors); the Young Professional Society of Greater Springfield (partner); and WWLP 22 News/CW Springfield (exclusive media sponsor).

Please refer to the below list to see when your 40 Under Forty honoree will be accepting their award.

2020 Sponsors Videos

2020 Presenting Sponsors

2020 Sponsors

2020 Partner

2020 Exclusive Media Sponsor

Special Coverage

The Clock Is Ticking

Jim Hunt

Jim Hunt, Eversource’s vice president of Regulatory Affairs and chief Communications officer.

Jim Hunt has one of those countdown clocks on his computer.

But unlike most of these mechanisms — which will tick down the minutes until a presidential debate starts or the months and days until the next summer Olympics will commence — this one has a very long end date. Or not so long, depending on who you’re talking with.

That would be 2030, the date by which Eversource Energy, which Hunt serves as senior vice president of Regulatory Affairs and chief Communications officer, intends to be carbon-neutral.

It’s an ambitious target, and therefore the next 10 years will certainly go by quickly as a result, said Hunt, noting that, while other utilities, especially those that are still vertically integrated and generate power as well as distribute it, have also set goals for carbon neutrality, most have set their clocks to 2050, 2040, or perhaps 2035.

“This is the most ambitious strategy for any utility in the country,” he told BusinessWest. “But we also have one of the strongest clean-energy and carbon-reduction policies from our state as well. So we think we can demonstrate to other utilities and to the world that, while these may be aggressive, they are attainable, and we’re going to meet them.”

Hunt met with BusinessWest late last month as part of a packed day of stops in the City of Homes. The schedule also included visits with other media outlets, Springfield Mayor Domenic Sarno, and Rick Sullivan, executive director of the Western Massachusetts Economic Development Council.

There was plenty to talk about, including Eversource’s pending acquisition of Columbia Gas operations in Massachusetts — an important deal that was due to receive final approval from the Department of Public Utilities as this issue was going to press — as well as COVID-19 and its impact on the region and the business community, and even a few power outages resulting from a storm that week.

“That last mile is always the roughest. It’s going to be a challenge to squeeze as much as we can out of facilities and out of our vehicles, but we’re committed to doing so because we need to lead by example.”

But the main topic of conversation — in part because Hunt couldn’t talk much about the Columbia Gas purchase until it was final — involved the company’s ongoing efforts to promote clean-energy use and reduce carbon emissions — including its own drive to become carbon-neutral.

It is an ambitious goal, said Hunt, and much will have to go right for it to be attained. Actually, the utility is already roughly 90% of the way there, he noted, but the last 10% will be the most challenging.

“That last mile is always the roughest,” he noted. “It’s going to be a challenge to squeeze as much as we can out of facilities and out of our vehicles, but we’re committed to doing so because we need to lead by example.

“If we’re going to help our region achieve its goals of 80% cardon reduction by 2050, if we’re going to be that clean-energy partner in energy efficiency, renewables, and other solutions for our customers and our state policy makers,” he went on, “then we think we can do more to go above and beyond and lead by example.”

increased reliance on solar and wind power

Jim Hunt says increased reliance on solar and wind power is just one of the ways Eversource has become a catalyst for clean energy.

 

To get there, the company, which serves 4 million customers in Massachusetts, Connecticut, and New Hampshire, will deploy a multi-faceted strategy that includes improving the efficiency of its facilities, reducing fleet emissions, replacing natural-gas mains to eliminate methane leaks, reducing line losses in the electric system, investing in renewable resources, and offsetting any remaining emissions with other earth-friendly emissions.

“We have a plan to do this,” he explained. “It’s about 2 million tons of CO2 that we need to reduce or offset, and we have people throughout our company working on that implementation strategy.”

For this issue, BusinessWest takes an in-depth look at Eversource’s ambitious carbon-neutrality goals and what it will take to reach them before the countdown clock on Hunt’s computer reads all zeroes, but also the many initiatives to help homeowners, businesses, municipalities, and the Commonwealth as a whole reduce their own carbon footprints.

Hour Town

‘Range anxiety.’

That’s a phrase Hunt summoned as he discussed why electric vehicles have not become as prevalent as some experts thought they might by this time — and in this place.

Range anxiety is just what it sounds like, he said, adding that some have a persistent fear that they could be on a long drive with no place to charge up. And this helps explain why, while the state has made significant progress in reducing carbon emissions and growing the ‘green economy’ in such realms as energy efficiency, cleaning up power plants, and bringing more solar and wind power onto the grid, the broad transportation sector is lagging behind in terms of overall impact.

“Roughly 43% of greenhouse-gas emissions in Massachusetts come from the transportation sector — the cars that are on our roads, the long-haul vehicles that are bringing commerce … that’s a real challenge,” said Hunt. “Great strides have been made to improve fuel economy, and we’re seeing more and more electrification of vehicles as a valuable solution.

“But while you can go buy an electric vehicle right off the lot, the challenge has been ensuring that there’s enough charging infrastructure throughout our roadway network,” he went on. “Not just in the urban core like Springfield and Boston and Worcester, but to get people to the more remote places, like those in Western Mass.”

“If you’re commuting to work, if you’re going to visit family, if you’re traveling to the Berkshires, you want to have that confidence that you’ll have a charge to get back home or to your destination.”

To this end, Eversource has created what it calls the Make Ready program, through which Eversource will pay the wiring infrastructure costs for thousands of new charging stations across the Commonwealth.

“We work with our customers who are interested in putting in charging stations but can’t pay the cost of that infrastructure,” he explained. “We’ll put in that infrastructure if they’ll agree to put in the charger and make it publicly accessible. This has been a great solution to deal with range anxiety — if you’re commuting to work, if you’re going to visit family, if you’re traveling to the Berkshires, you want to have that confidence that you’ll have a charge to get back home or to your destination.”

The Make Ready program, which has helped add thousands of charge points across the Commonwealth, including ones at the parking garages at Union Station and MGM Springfield, is just one of the ways Eversource has become a catalyst for clean energy, said Hunt, adding that perhaps the biggest component of this broad strategy is perhaps the simplest — helping both residential and commercial customers use less energy through higher efficiency.

solar panel and charging station

The Eversource solar panel and charging station in Westwood, Mass.

“We’ve been consistently ranked the number-one energy-efficiency provider in the nation,” he noted, due in large part to an effective partnership with the Bay State, which, along with California, traditionally has the strongest energy-efficiency policies in the nation, and Connecticut and New Hampshire as well. “We try to reach out to all our customers — residential, industrial, commercial, and communities as well — to espouse the values of energy efficiency; it really is the first fuel. If you can reduce your energy consumption, you’re cutting down on your own bill, but that also provides great benefits for the environment and clean-energy strategy.

“That’s the foundation of our clean-energy strategy,” he went on, adding that, for every dollar invested in energy-efficiency initiatives, the customer receives $3 return on that investment. And this is true across the board, whether it’s a residential customer that undertakes an energy audit and tunes up a furnace for the winter, or a commercial customer that installs more energy-efficient lighting.

Overall, Eversource invests $500 million in energy-efficiency initiatives, which yield $1.5 billion in benefits for those 4 million customers, while also contributing to sharp reductions in greenhouse-gas emissions, from more than 2.5 million metric tons of carbon dioxide in 2014 to roughly 800,000 tons in 2018.

Also contributing to those numbers are initiatives that help customers connect solar and other distributed-generation resources to the grid.

“We’ve made those investments to modernize the electric grid and make it ready for taking distributed energy, whether it’s solar or other distributed-energy resources,” Hunt explained, adding that the company also owns and operates some utility-scale solar operations, such as the one constructed on the brownfield site at the former Chapman Valve complex in Indian Orchard, a facility that he described as a model for the state when it comes to showcasing larger-scale solar energy and forging partnerships with communities to make such projects happen.

Elaborating, he said Eversource is currently working with the Massachusetts legislature to expand the cap on the solar capacity the utility can develop. Currently, that cap is 70 megawatts, and Eversource is at that number through the creation of several sites across the state.

 

Fueling Optimism

There are other components to this clean-energy strategy, said Hunt, listing windpower initiatives — the company is partnering with Orsted, the largest and most successful operator of offshore wind in the world, to develop up to 4,000 megawatts of offshore wind capacity, reducing carbon emissions by millions of tons each year — as well as energy-storage steps that will reduce the need for fossil-fuel-powered generation, while improving power quality and reliability.

These are, of course, part of the company’s own efforts to become carbon-neutral. As noted, this strategy has a number of components, from divesting fossil-fuel plants to offshore wind and solar; from improving efficiency at its many facilities to making its own fleet of vehicles greener, although much work remains in that realm, as we’ll see.

“We’ve made those investments to modernize the electric grid and make it ready for taking distributed energy, whether it’s solar or other distributed-energy resources.”

These efforts, as noted, have put the company more than 90%, and perhaps even 95%, of the way toward its goal of carbon neutrality. But, as Hunt said, the last mile is traditionally the most difficult, although he believes the goal is attainable.

“We’re a leading energy-efficiency provider. We can reduce our consumption in the 150 facilities we own and operate in New England be more efficient with lighting and energy use, procure more clean-energy resources to power those buildings … we’re developing that plan; we’re building smarter buildings to get to net-zero-energy for the buildings we operate.”

As for the fleet, there are electric vehicles in that fleet, mostly lighter models, and there are charging facilities at all of Eversource’s facilities, he noted. But the heavier trucks, including those used to restore power when there are outages, are more difficult to convert to electric.

“But we’re looking at innovations, like hybrid vehicles that might be powered by diesel today, but might be powered down while they’re doing work, with the buckets running on electric only,” Hunt said. “When you think about how these vehicles have operated, they’ve had to be on and idling so you can run the power on that arm. Today, we’re investing in hybrid types of vehicles that we can power down.

“We’re not far off,” he continued. “There’s a lot of research and a lot of investment going into electrification of more heavy-duty vehicles; there will be a day when 18-wheel vehicles are powered electrically and run autonomously.”

Meanwhile, on the gas-business side, the company is working to tighten up its infrastructure, some of it built 100 or more years ago and now prone to leaks. And these efforts will grow in scope with the acquisition of Columbia Gas, which operates in Brockton, Lawrence, and Springfield and boasts some 330,000 customers.

“We’ll be making the same kind of investments in upgrading older infrastructure and reducing leaks in the Columbia Gas system,” he noted. “In making the decision to purchase those assets, we assessed all that, and we’re committed to achieving it. It will make our goal of carbon neutrality even more challenging, but we’re up to the challenge.”

Beyond infrastructure, Eversource is also looking into cleaner, more efficient natural-gas options.

“Natural gas is an important bridge to a clean-energy future,” he explained. “Our customers depend on it, and it’s a cleaner, more cost-effective fuel for home heating and thermal needs than oil or electric. But we’re exploring ways to inject cleaner natural gas — and that might be biogas from agriculture or, further down the road, injecting hydrogen gas into our natural-gas system to further offset methane use; we’re exploring those opportunities.”

 

Powerful Arguments

Returning to the matter of that countdown clock, Hunt said Eversource has set benchmarks for different points over the next decade, and will be developing a scorecard, as well as an offset strategy, for its quest for carbon neutrality.

“We’ve got nine years to get there, but in many respects, that’s right around the corner — that’s not far away,” he noted, adding, again, that the goal is ambitious, but reachable.

In short, a utility that has in many ways set the standard when it comes to energy efficiency and clean-energy use is looking to continue that tradition.

 

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

Banking and Financial Services Coronavirus Special Coverage

Lending Support

Chuck Leach, president and CEO of Lee Bank.

Chuck Leach, president and CEO of Lee Bank.

Community banks love commercial lending, Chuck Leach says.

“It’s just good business for us — Main Street lending, that’s where we can have a nice give and take with customers. It’s kind of our wheelhouse.”

That’s all still true, even though 2020 has rocked that wheelhouse in unexpected ways.

“We’re not seeing the same commercial demand,” said Leach, president and CEO of Lee Bank. “It’s either risk aversion or businesses are waiting to see what happens.”

Or, in some cases, they’re extra liquid after taking advantage of the Paycheck Protection Program (PPP) and other stimulus measures, as well as deferring payments on other bank loans, he added. “Put all that together, and they may not have borrowing needs right now, or they’re sitting on their liquidity until they see some clarity with the pandemic or the election or both.”

Clarity has been in short supply since the COVID-19 pandemic forced a widespread economic shutdown at the start of spring that continues to wreak havoc.

Michael Oleksak remembers the first few months of the year, of hearing occasional news about the novel coronavirus back in January, and much more of it as February crept along.

“I’d been asking myself for years, ‘what are we missing? What’s next?’ Because there had to be a ‘next.’ Who would have thought it would be a pandemic?”

“Then, from mid-March into April, everything was a blur. It just spiraled,” said Oleksak, executive vice president, senior lender, and chief credit officer for PeoplesBank, before discussing the PPP surge and other measures that followed (more on that later).

Blurring the picture further was the very uncertainty of what was coming. Having experienced several economic upheavals, from the bank failures of the early ’90s to the bursting of the dot-com bubble in 2000 and 2001, to the housing crisis in 2007 and 2008, he had no idea what the next crisis would be.

“I’d been asking myself for years, ‘what are we missing? What’s next?’ Because there had to be a ‘next.’ Who would have thought it would be a pandemic?

“This will be the fourth economic cycle I’ve been through, and every one has been different,” he added. “And this one is far different than the others. We’re not seeing a lot of new activity. I think everyone is kind of hunkered down, for lack of a better word, in survival mode.”

As Allen Miles, executive vice president at Westfield Bank, put it, “obviously this one was a lot different. You couldn’t see the train wreck coming; that’s the best way to explain it. It just got dropped on us.”

What happened next in commercial lending is an oft-told story recently, but one worth telling again. What will happen next … well, no one really knows. But banks will certainly take lessons from a challenging past seven months as that story takes shape.

 

Lending a Hand

Miles said Westfield Bank started reaching out to loan customers in February when coronavirus became a more widely reported issue. In mid-March, like other banks, it was actively sending employees home. And then the storm hit.

From mid-March into the start of April, “that two weeks was absolutely crazy because you had people looking for loan deferrals, and the bank examiners were very friendly to both the banks and borrowers to try to help these people out,” he recalled. “We were just trying to help our customers. You’re not worried about loan origination; you’re just worried about getting people through the unknown and the craziness.”

Michael Oleksak says new lending activity has been down

Michael Oleksak says new lending activity has been down because many businesses are “in survival mode.”

The first Monday in April, the bank received about 500 PPP applications, and about the same number the next day.

“We needed to get all hands on deck,” Miles told BusinessWest. “We were still waiting on guidance from regulators and the Treasury Department. We had people afraid for their livelihoods, their families, and everything. It was organized chaos.”

The bank got $185 million in PPP loans approved in that first round, what he called a “herculean task.” The second round, several weeks later, was much less chaotic. “That was more for the smaller businesses — a lot more applications, but smaller in dollar size. We were able to keep up with those because we’d been through it, and they weren’t as complicated.”

Oleksak said the PPP was a critical lifeline for a lot of people. “There was kind of a mass panic there wouldn’t be a round two, which put a lot of pressure on the banks and our customers, trying to rush to get them into a program that was not very well-defined from the outset,” he recalled. “Then round two came along, and everyone who needed funds was able to access them, and that made a big difference.”

Leach said the widely reported chaos was quite real, but the larger story was a positive one.

“For now, this has put a lot of capital in the banks and a lot of capital in businesses in our region and beyond. A lot of our customers are in good shape right now.”

“In spite of the controversy, and the people who thought they were making up the rules as they went along, I think the PPP was very functional,” he said. “We’re seeing a lot of customers well-capitalized right now, which is the untold story nationally.

“Maybe that changes and this is just a Band-Aid,” he added, due to the lack of clarity about the next few months, from fears of a second COVID-19 surge to the limbo status of further federal stimulus. “But, for now, this has put a lot of capital in the banks and a lot of capital in businesses in our region and beyond. A lot of our customers are in good shape right now.”

Lee Bank processed 348 PPP loans and has submitted more than 100 forgiveness applications, although some customers are waiting to see if the federal forgiveness guidelines change, specifically whether “they do a sweeping approach where everything under $150,000 is forgiven with a very, very simple forgiveness application.”

Again, borrowers want clarity. Still, Leach came back to the positive impact his bank was able to make with the PPP — and also with loan-payment deferrals for about 240 customers, with about $60 million deferred in total. “In a bank that has $400 million in total assets, you can see that’s a good chunk,” he said, adding that only a fraction of those customers requested a second deferral period.

Oleksak and Miles both reported similar trends, with requests for continued deferrals dropping after the first 90-day period.

“Thirty days before the first deferment was up, we contacted people, and 85% to 90% said, ‘we’re good, we’re not going to be looking for a deferral going forward.’ So that made us feel really comfortable,” Miles said. “With the PPP and the deferrals, it bridged the gap for customers.”

“We’re being very sensitive,” added Kevin O’Connor, Westfield Bank’s executive vice president and chief banking officer. “We’ve been very involved with them, understanding their needs and how the bank can work with them.”

While borrowers in the broad hospitality sector continue to struggle, for obvious reasons, most customers have come through the past seven months well with the help of PPP and loan-payment deferrals, Miles added. “The main ones hurting are the ones being affected by the phases and the rollouts — restaurants, bars. They’ll take a while to get back on their feet.”

 

Starts and Stops

That’s true in the Berkshires as well, Leach said, and restaurants in particular are worried about the onset of cold weather and an inability to seat more customers, due to both the state’s indoor-capacity restrictions and the reluctance among some patrons to eat inside restaurants right now.

But the region’s hospitality businesses have benefited in others ways during the pandemic; in fact, one bed-and-breakfast he spoke with did record business this summer.

Allen Miles says some loan customers are doing well

Allen Miles says some loan customers are doing well, while others, particularly in hospitality, continue to struggle.

“People left urban areas for a safer place, whether for weekends or longer,” he said, adding that some secondary homes became primary homes, while other people bought first homes in an area they felt was safer than, say, New York City. “Interest rates are obviously really low, but there’s also the fear factor of ‘wait, I’ve got to get out of this urban area.’ So there’s been a huge sense of urgency to buy in an area like the Berkshires.”

Unlike some lending institutions, Westfield Bank has seen healthy activity in loan originations recently, Miles said.

“The deferments and PPP money actually made some people stronger because it’s been cash preservation instead of cash burn,” he noted. “Usually for commercial lending, it starts getting busy after Labor Day. We weren’t sure if we were going to see that cycle again, but now it’s quite busy, and people are active. So that’s a really good sign.”

That activity is strong across the board, particularly in commercial real estate, where customers are refinancing for a lower rate or selling, he explained. “It’s a great time to sell — low interest rates, lower cap rates, people are going to pay you more for the property — so you’re seeing a lot of transactions going on right now.”

Commercial and industrial (C&I) loans are healthy as well, he said, adding, of course, that, “with anything related to hospitality or travel, the jury’s still out on that. The longer this [pandemic] hangs over us, the longer the recovery for them.”

At PeoplesBank, Oleksak said, many customers have been accumulating cash and paying down lines of credit, or shopping around to lock in better long-term rates on loans, which is a challenge for banks already facing flattened yield curves. “I think the depth of the crisis is a little bit masked by the amount of stimulus money in the market, from PPP, SBA programs, and deferments.

“The deferments and PPP money actually made some people stronger because it’s been cash preservation instead of cash burn.”

“Some individuals out there are suffering mightily, particularly restaurants and hospitality,” he added. “The other great unknown is, we don’t have a vaccine yet. Are we going to see another spike? People are trying to get back to normal here, but I’m not sure what the new normal is going to look like.”

He pointed to his own institution as an example. Between half and two-thirds of PeoplesBank employees are still working remotely, a trend being reflected across all geographic regions and business sectors.

As a result, “nobody really knows what’s going to happen with the office segment of the market, with so many people working from home. Will they go back at some point? Will companies decide they don’t need so much space, or does social distancing mean you have fewer people but still need more space? It’s a total unknown for us.”

It’s unfortunate that some industries, like restaurants, will likely see a slower return to health, O’Connor said, “but it’s good to see customer confidence in some areas coming back, even a little bit sooner than we would have expected.”

Miles agreed. “We’re very happy with what we’re seeing right now. It’s not behind us, but it’s not as bad as people anticipated. If activity is picking up and people are borrowing, they’re confident, which is good.”

 

Joseph Bednar can be reached at [email protected]

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times.

Episode 34: Oct. 12, 2020

George O’Brien talks with Pam Victor, founder of Happier Valley Comedy

George O’Brien talks with Pam Victor, founder of Happier Valley Comedy, about her unique business, which focuses on improvisation and resilience training to help with professional development, how she’s had to pivot during the pandemic …. and also about how to stay positive, as difficult as that is, during these difficult times for all those in business. It’s must listening, so join us on BusinessTalk.

 

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Cover Story Special Coverage

The Business of Pivoting

Nicole Ortiz, founder and president of Crave Food Truck

Nicole Ortiz, founder and president of Crave Food Truck

Nicole Ortiz remembers a lot of people having some serious doubts about whether she should go forward with her plans to put a food truck into operation late last spring.

After all, it was the middle of a pandemic, people were staying home, the economy was tanking, and the restaurant business, perhaps more than any other, was suffering mightily.

But Ortiz, a graduate of the Culinary Arts program at Holyoke Community College, was determined to make her dream, which she would call Crave, become reality — pandemic or not.

She had already acquired the vehicle itself, and her experience in the accelerator program operated by EforAll Holyoke had given her the confidence (and technical know-how) to get her show — a food truck specializing in Puerto Rican cuisine — on the road … literally.

Problem was, it was not business as usual when it came to securing the needed approvals and permits from city officials.

“It was even difficult to speak with officials from cities because people weren’t working as much, and you couldn’t even get into city halls,” she said. “Everything has to be mailed in, which takes … as long as that takes. Meanwhile, a lot of cities don’t have ways to do this online; you can’t e-mail them or submit a form online. You have to mail it in, and that took a while.”

But Ortiz persevered, and opened for business just over a month ago. Her truck, usually parked on Race Street, not far from the Cubit Building and just a few blocks from the computing center, is actually exceeding goals set higher than most everyone she knows thought were reasonable.

Successful launches in the middle of COVID-19 are certainly rare, and for most area entrepreneurs, especially those trying to get a concept off the ground or to the next level, these are challenging times, when the focus is on pivoting and adjusting to meet changing needs and changing ways of doing things.

Juan and Elsie Vasquez, owners of 413 Family Fitness

Juan and Elsie Vasquez, owners of 413 Family Fitness, are like many small-business owners in that they have had to pivot during the pandemic and create new revenue streams.

In most all ways, the same can be said of the region’s entrepreneurship ecosystem itself, which specializes mostly on programs focused on people gathering in large numbers or sitting across a table from one another — things that can’t be done during a pandemic. Agencies within the ecosystem have been pivoting and adjusting as well.

This is especially true of Valley Venture Mentors (VVM), the nonprofit based in Springfield’s Innovation Center, which is in the midst of what interim Director Chris Bignelli, a partner with the Alchemy Fund, calls a ‘reset.’

That’s the word he chose to describe a retrenching after most of the agency’s staff members left within a week of each other last spring, and after COVID prevented it from staging any of the large gatherings for which it became known — not only here, but across the state and beyond.

“Our mentors advise entrepreneurs about the importance of pivoting and changing directions when needed, and we’re doing the same,” he said, adding that the pandemic and other forces are compelling the agency to look inward and find new and perhaps different ways to provide value to entrepreneurs while also providing support to other agencies and initiatives within the ecosystem.

“For a while there, it really felt like we were kind of providing therapy to small-business owners.”

As VVM resets and reinvents, though, work within the ecosystem goes on during these trying times — despite COVID, and in many cases in an effort to help business owners survive it.

People like Juan and Elsie Vasquez. They operate 413 Family Fitness in Holyoke, a business that, like most all gyms, was devastated by the pandemic. With help from those at EforAll Holyoke, the couple has pivoted to everything from outdoor classes to staging quinceañeras, or sweet-15 birthdays (a tradition among Hispanics), and leasing out their space to third parties (more on that later).

Meanwhile, another initiative within the ecosystem, WIT — Women Innovators and Trailblazers — is continuing its mentoring program despite COVID, and is preparing to embark on its third cohort of matches.

Leah Kent

Leah Kent says the mentor she’s been matched with through the WIT program, Melissa Paciulli, has helped her set firm goals for her business and move out of her comfort zone.

The second cohort, featuring 45 teams, up from 20 in the first, was started just before the pandemic shut things down, noted Ann Burke, vice president of the the Economic Development Council of Western Massachusetts and one of the architects of the program, adding that she had some concerns about whether those matches could withstand COVID and its highly disruptive nature.

But for the most part, the partnerships persevered, and many have the legs to continue even after the formal program is over.

“We were really trying to see what would happen with the cohort and how they would respond with all that was happening,” said Burke. “I thought most of them would just throw up their hands and say, ‘we can’t do this’ amid all the business issues, personal issues, and issues at home. But for the most part, that’s not what happened.”

For this issue, BusinessWest takes an in-depth look at the local entrepreneurship ecosystem and how it is carrying on through the pandemic, providing more evidence of its importance to the region.

Keep on Trucking

Flashing back several months and then fast-forwarding to today, Ortiz described the process of opening with a single word — ‘crazy.’

That sentiment applied to everything from getting her truck outfitted for the road — meaning wrapped with her logo and fully equipped — to buying all the supplies she needed (which meant going to the grocery store a number of times), to getting those aforementioned permits and approvals. Work started later than she wanted, and everything was made more difficult by the pandemic.

“Most of March and half of April, I called a halt to everything,” she said, noting that she bought the truck in February, but, because of the pandemic — and also the fact that she was still in school, which was also more complicated — she wasn’t able to advance her plans. “And then I started to feel more comfortable, and by the end of the April, I was going full speed.”

Or at least the speed at which City Hall would allow her to travel.

Now that she’s open, all that craziness seems like a distant memory, and business is, as she noted, exceeding expectations.

“We’ve been busy every day, and we usually sell out by the end of the day,” she said, noting that Craze features tacos, rice bowls, vegetarian and vegan dishes, and more, and uses social media to connect with potential customers. “COVID might actually be helping because people don’t want to go to restaurants.”

She credits EforAll — she was the first-place winner in its recent winter accelerator — with helping her get the doors open, especially with such matters as insurance and accounting, but also focusing on the model she wanted and the service she wanted to provide.

And such work is carrying on in the COVID-19 era, although it’s somewhat different and also in some ways more challenging, said Tessa Murphy-Romboletti, executive director of EforAll.

“We’ve been really fortunate that we can continue to offer a lot of the services that we provided before the pandemic in a virtual format,” she explained. “And we made that pivot very quickly, out of necessity.”

Elaborating, she said the agency was in the final stages of its winter cohort when the pandemic hit, and quickly shifted to not only a virtual platform, but a somewhat different purpose as it helped both those cohort members and other small businesses cope with everything that was happening.

“For a while there, it really felt like we were kind of providing therapy to small-business owners,” she explained. “We felt like there were a lot of things out of our control, but what we did want to do was support them, whether it was with help navigating PPP loans or even just applying for unemployment. We were doing a lot of one-on-one support and just helping people however we could.”

“It gives people a place to come and brainstorm as a group and impose that accountability that can sometimes be missing when you’re running your own venture.”

And such help was certainly needed, she said, adding that, in the case of PPP, many small businesses didn’t know if they were eligible, and if they were, they certainly needed assistance with paperwork that most established businesses turned over to a seasoned accountant. Meanwhile, a number of local, state, and federal grant programs emerged, and small businesses needed help identifying which ones might be appropriate and then navigating the application process.

Beyond that, EforAll also helped some businesses identify ways to pivot and find new revenue streams in the middle of a pandemic, Murphy-Romboletti said, adding that such assistance was provided to restaurants — helping them move beyond takeout and Grubhub, for example — and to other kinds of ventures, like 413 Family Fitness, which is one of those businesses that just ‘graduated’ from the most recent accelerator.

Like all fitness centers across the state, this operation had to shut down back in the spring, said Elsie Vasquez, forcing the company to pivot. It did so by offering classes online, then a shift to outdoor classes, more one-on-one personal training, and finally a reopening of the studio in July, with a host of restrictions.

“We’ve even done some space rental to bring in some revenue,” she told BusinessWest, adding that EforAll has been invaluable in helping to not only identify ways to generate business, but make them reality.

“The biggest thing we learned is that we have to pivot our business,” she explained. “We came in with an idea of what we wanted to do, and it’s been working out OK, but EforAll really opened our eyes to the fact that we have to think differently, and that your beginning result may not be your end result.”

In Good Company

While companies are pivoting, so too are some of the agencies within the ecosystem that serves them. And VVM is probably the best example.

Hope Gibaldi, who was serving the agency in a part-time role when the pandemic hit and is now full-time, serving as engagement manager, told BusinessWest that the agency has had to readjust as a result of the pandemic and its inability to stage the large gatherings it became known for.

Meanwhile, is doing what its mentors advise entrepreneurs to do — assess needs within the community and go about meeting them.

“There were listening sessions prior to the pandemic,” she noted, “and we’ve been taking the priorities identified during those sessions with an eye toward addressing them, while also trying to figure out how we can continue to provide value to entrepreneurs during COVID and what programming might look like when we come out of COVID.”

Elaborating, she said hybrid models blending in-person and remote programming are being considered, while, in the meantime, the agency is creating ways to bring people together on a remote basis to share ideas and work through common problems.

One such program is the introduction — or reintroduction, to be more precise — of ‘Entrepreneurial Roundtables,’ a peer-led “accountability group,” as she called it, that meets via Zoom.

“It’s a place where mentors and entrepreneurs can come and address their challenges,” Gibaldi explained. “It gives people a place to come and brainstorm as a group and impose that accountability that can sometimes be missing when you’re running your own venture.”

Other initiatives already in place or in the planning stages, she said, include everything from the agency’s once-thriving Community Nights (now handled remotely) to expert-in-industry mentorship, to a book club, to be launched in January, focusing on offerings in entrepreneurship, marketing, personal and professional growth, and more.

Overall, VVM looks a little different, but its mission hasn’t changed, Gibaldi said, adding that it is working to partner with other agencies and initiatives within the ecosystem to help them succeed.

One example is WIT, and helping to recruit mentors for that program, which has thus far created dozens of effective matches.

Leah Kent and Melissa Paciulli comprise one such match. The former is a writer and book designer who also helps other writers with the process of getting published, while the latter is director of the STEM Starter Academy at Holyoke Community College. Kent described the relationship as an intriguing, and effective, collision of science and creativity.

“We can understand each other quite well, but we bring different strengths,” she explained. “That complementary pairing has been so fantastic. In my work, she’s really honed in on the way that I help readers finish their manuscripts and get their work published.”

The two were part of the cohort that launched last March; the kickoff gathering was on March 12, and the next day, schools were shut down, and much of the business world ground to a halt. Kent’s original mentor was not able to continue participating because of the pandemic, so she was reassigned, if that’s the right word, to Paciulli, whom she credits with taking her outside her comfort zone and helping her set the bar higher professionally and personally.

Paciulli said Kent is her second match through WIT, and one of many business owners and students she has mentored over the years. She finds the work invigorating and rewarding, especially when the mentee is coachable and open-minded — like Kent.

“When you’re working with entrepreneurs and they’re coachable, and they take action on your direction, because it’s an iterative process of finding your product, getting it to market, and pivoting when you need to … it’s a super-cool experience to be part of one’s journey in that way,” she said. “When they’re coachable and they’re action-oriented — and she is — it’s awesome.”

Where There’s a Will…

Summing up what the past seven months or so have been like for entrepreneurs and small businesses, Murphy-Romboletti said it’s been a continuous run of challenges that have tested them — and her agency — in every way imaginable.

In many ways, COVID-19 and everything it has thrown at these businesses only reinforces what she pretty much already knew.

“What always inspires me about entrepreneurs is that, if you tell them ‘no,’ they just say, ‘OK, let me find out a way to make this work,’” she said.

Many have been doing just that, providing more evidence of their resiliency and more reminders of the importance of the entrepreneurship ecosystem to this region and its future.

The pandemic has slowed some things down and added to the already-long list of hurdles entrepreneurs have to clear, but it certainly hasn’t stopped people like Nicole Ortiz — and countless others — from getting down to business.

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

Class of 2020 Special Coverage

It was a different kind of event, to be sure, but BusinessWest’s Difference Makers class of 2020 was celebrated in style on Sept. 24 at the Upper Vista at the Log Cabin Banquet & Meeting House in Holyoke. Honorees, their guests, and sponsors were in attendance at an event where safety and social distancing were paramount, while hundreds more took in the ceremonies remotely. Download the Program Guide HERE

Difference Makers is sponsored by Burkhart Pizzanelli, Mercy Medical Center, The Royal Law Firm, and TommyCar Auto Group, while the Tom Cosenzi Driving for the Cure Charity Golf Tournament, MHA, and United Way of Pioneer Valley are partners.

The 2020 Virtual Event

Scenes from the 2020 Event

2020 Difference Makers

Christopher ‘Monte’ Belmonte

DJ at WRSI the River Radio

His March is Changing
The Conversation
on Food Insecurity

Ira Bryck

Consultant and Former Executive Director of the Family Business Center of Pioneer Valley

He’s Helped Create
Fun, Imaginative
Learning Experiences

Sandy Cassanelli

CEO of Greeno Supply

She’s Fighting to Find a Cure for Metastatic Breast Cancer

Dianne
Fuller Doherty

Retired Director of the Massachusetts Small Business Development Center

She’s Retired … but Not from Her Role as a Difference Maker

Ronn Johnson

President and CEO of Martin Luther King Jr. Family Services Inc.

This Community Leader
Has Tackled Many Roles
With a Sense of Purpose

Steve Lowell

President and CEO of
Monson Savings Bank

Giving Back Has Always Been a Big Part of His Life — and His Work

Rick’s Place

This Unique Nonprofit Provides Support, Light in the Darkest of Times

2020 Sponsor Videos

2020 Sponsors

Pay it Forward Non-Profit Partners


Photography for this special section by Leah Martin Photography

Alumni Achievement Award Special Coverage

Class Acts

As they came together via Zoom to decide who would take home the coveted Alumni Achievement Award for 2020, the three judges who scored the nominations kept talking about how hard their final assignment was. Indeed, they admitted that all five finalists — Carla Cosenzi, president of TommyCar Auto Group, Peter DePergola, director of Clinical Ethics at Baystate Health; Mike Fenton, attorney with Shatz, Schwartz and Fentin and a Springfield city councilor; Paul Kozub, founder of V-One Vodka; and James Leahy, assistant director of Business Development and Promotion Sales for the Massachusetts State Lottery and a Holyoke city councilor — were more than worthy of the honor, formerly known as the Continued Excellence Award. As they debated the merits of each finalist, the judges had a difficult time settling on one winner of this award, sponsored again this year by Health New England. So they instead decided to honor two.
Carla Cosenzi

Carla Cosenzi, president of TommyCar Auto Group, with her children, Niko and Talia.

• Cosenzi, who adds this honor to two others from BusinessWest (40 Under Forty in 2012 and Women of Impact in 2019), was chosen both for what she’s done in business — expanding the auto group started by her father with several new dealerships — and for what’s she’s done in the community. Chief among her accomplishments in that latter category has been the creation of the Tom Cosenzi Driving for the Cure Charity Golf Tournament, staged each year to raise funds to battle brain cancer, which claimed her father when he was just 52 years old.
Peter DePergola

Peter DePergola, director of Clinical Ethics at Baystate Health.

• DePergola, who has emerged as not only a regional, but national and even international leader in the emerging field of bioethics, also now has three plaques from BusinessWest on his desk. Indeed, in addition to 40 Under Forty (class of 2015), he was also named a Healthcare Hero in the Emerging Leader category in 2018. The first, and still the only, bioethicist in this region, he recently wrote a white paper titled “Ethical Guidelines for the Treatment of Patients with Suspected or Confirmed Novel Coronovirus Disease,” published in the Online Journal of Health Ethics, and also served on the state’s Crisis Standards of Care Advisory Committee. BusinessWest congratulates these two deserving winners, who continue to raise the bar for professional and personal achievement in Western Mass.
Coronavirus Insurance Special Coverage

At a Premium

The story is a familiar one by now: hospitals across the U.S., hammered by COVID-19, began directing resources toward fighting the pandemic last spring and curtailed elective and non-emergency procedures. Meanwhile, patients, even when sick, stayed away from medical practices out of fear of infection.

As a result, health insurers continued to reap premiums while paying out millions of dollars less in medical claims. Some of the largest companies reported second-quarter earnings about double what they were a year ago. Anthem’s net income soared to $2.3 billion for the second quarter, up from $1.1 billion in 2019, while UnitedHealth reported net income of $6.7 billion, compared to $3.4 billion last year. Humana’s second-quarter net income rose from $940 million in 2019 to $1.8 billion in 2020.

But the issue is a complex one, especially in Massachusetts, where laws governing insurance are different, said Keith Ledoux, vice president of Commercial Line of Business, Sales, Marketing, and Business Development for Health New England, a 166,000-member health plan based in Springfield.

For example, HNE did see lower utilization for medical services among its members in the early months of the pandemic; however, at the same time, it saw an increase in prescription-drug fills as members made sure they had their medications during stay-at-home orders.

“On the pharmaceutical side, we saw a small spike in claims and overall costs starting at the end of March and the beginning of April because we had relaxed our rules on allowing folks to fill prescriptions early, or to get a greater supply,” Ledoux told BusinessWest.

Meanwhile, “after April, on the medical side, we saw a significant reduction in claims, but starting in probably June, we started to see that pick back up — almost back to what we would consider to be somewhat normal.”

At the same time, the pandemic brought about a significant increase in telehealth utilization; through April, HNE had processed 114,000 telehealth visits for its members versus 900 in all of 2019, accounting for $12 million in costs for Health New England.

“One reason that’s so costly for us is that we’re mandated by the government to pay the same rate for telehealth as we would for an in-person visit, and typically telehealth is cheaper than in person,” Ledoux said, adding that future state negotiations will likely alter that formula as telemedicine continues to gain traction in healthcare.

“The silver lining is not the cost, but the behavior shift of so many members embracing the idea of telemedicine, which does broaden your ability to access non-invasive care. There’s definitely an opening for systems to adopt a new approach and potentially increase their revenue stream using telemedicine.”

Massachusetts-based Tufts Health Plan reported that COVID-19 treatment costs were one factor in actually recording a drop in net income between the first six months of 2019 to and the six months of June 2020.

Keith Ledoux

Keith Ledoux

“After April, on the medical side, we saw a significant reduction in claims, but starting in probably June, we started to see that pick back up — almost back to what we would consider to be somewhat normal.”

“Tufts Health Plan proudly serves all segments of the market, regardless of a person’s age or life circumstance,” Chief Financial Officer Umesh Kurpad noted in a statement. “This diversity in our business translates into different financial pressures, such as significantly higher COVID-19 infection rates and treatment costs for our members, particularly those who rely on both Medicare and Medicaid.

“Year-to-date, our earnings were challenging, with the increased costs of COVID-19-related expenses across virtually all of our businesses,” he went on, projecting COVID-19 expenses to reach $220 million for the full year. “The pandemic cost tail is anticipated to be long with the lingering impact of COVID-19 survivors and increased morbidity from deferred care.”

In short, there’s no one trend common among health insurers in a year where they, like all industries, have learned to expect the unexpected.

Appointment Viewing

Another Massachusetts-based insurer, Harvard Pilgrim Health Care, reported little change in second-quarter net income from 2019 ($36.2 million) to 2020 ($40.9 million). It also encouraged members not to avoid medical services they need.

“Now more than ever, our focus remains on the health and well-being of our members and the communities we serve,” President and CEO Michael Carson said. “Many people have deferred care over the past several months, and it is incredibly important that they not neglect their health. Healthcare providers have implemented stringent safety precautions, and we encourage our members to seek routine and preventive care, including checkups, health screenings, and vaccinations.”

Ledoux told BusinessWest that HNE typically doesn’t know the performance of a year until probably three or four months after the year has closed.

In its planning for 2021, he explained, the company must consider uncertainties with expenses, which include utilization continuing to pre-COVID levels; increased use of high-cost technology; and costs of new pharmaceuticals, vaccines and testing, as well as increased costs for certain behavioral healthcare for children and adolescents.

Consumers are protected to an extent by state and federal laws that require health plans to rebate customers annually if the percent of premiums spent on medical expenses falls below a certain threshold.

Under the Affordable Care Act, insurers are required to use a fixed percentage of the money they take in from premiums for their customers’ medical expenses — at least 80 cents of every dollar they collect in premiums from small businesses and individuals, and 85 cents per dollar for large employers. The remaining 15% to 20% percent is what they are allowed under the ACA to spend on administrative costs like overhead and marketing, and to keep as profit. Excess revenues are to be returned to consumers in the form of rebates.

“If we perform even 0.1% better than 88%, we have to rebate that excess margin back to the market. In a regular year, our target margin is around 1.9%, which we hardly ever achieve. All these variables make it difficult to make a profit.”

Under Massachusetts’ health-insurance law, that number rises to 88 cents on the dollar. “If we perform even 0.1% better than 88%, we have to rebate that excess margin back to the market,” Ledoux said, adding that, “in a regular year, our target margin is around 1.9%, which we hardly ever achieve. All these variables make it difficult to make a profit.”

Some of those variables emerged this year in the form of concessions to the pandemic and the stress it has placed on families, he noted. “We relaxed a lot of rules on how we collect premiums. Normally it’s a 30-day grace period, and we expanded that another 30 days.” HNE also allowed furloughed employees to stay on their companies’ health plans.

“We continue to evaluate our position in the market,” he added. “There are already protections in place, profits above what would be considered reasonable, and a mandate to rebate that back to the market. We already know it self-corrects on its own.”

Meredith Wise, president of the Employers Assoc. of the NorthEast, told BusinessWest that health-insurance premiums haven’t been a big topic among EANE’s members. “We’ve heard from some employers who are getting refunds, but it hasn’t been a major thing that anyone is focusing on at the moment.”

Nationally, insurers are spending a far lower portion of premium revenue on their customers’ healthcare costs. For example, CVS said its medical-benefits ratio was 70% for the second quarter, compared to 84% over the same period in 2019.

According to a report in the New York Times, the ACA gives companies a three-year window to calculate how much to return, so members probably shouldn’t expect relief anytime soon, especially because it’s hard to tell what the rest of the year will bring, with COVID-19 numbers still fluctuating dramatically from state to state, as well as the impact of potentially expensive new vaccines or treatments around the corner. At the same time, many people who postponed getting medical attention could surge back into doctors’ offices and submit more bills for coverage.

“The second half of the year could see a lot more care, and higher costs, than the first half of 2020,” according to a statement by America’s Health Insurance Plans (AHIP). “However, if these costs never materialize and remain below certain levels, American consumers, businesses, and taxpayers are protected by provisions in federal and state laws that require health-insurance providers to deliver premium rebates and put money back into their pockets.”

Community Focus

In addition to changes in patient volume and the bottom line, the pandemic shifted the priorities of Health New England in other ways, Ledoux said.

For instance, it contributed $300,000 in grants for COVID-19 relief efforts throughout Western Mass. to help residents with access to food, mental healthcare, child care, housing, and basic needs.

The company has also made benefit adjustments that make it easier for members to get the care they need, such as eliminating out-of-pocket costs for all telehealth services and for COVID-19 diagnostic testing ordered by a medical professional, no prior authorizations for members receiving medical care for COVID-19, and flexibility with payment plans and adjusted underwriting guidelines to ease the burden for employer-group customers and members.

Meanwhile, as it approaches Medicare’s annual enrollment season, Health New England is holding online Zoom sessions and drive-up events, and has added staff to its call center, to help educate people about their Medicare options.

“The second half of the year could see a lot more care, and higher costs, than the first half of 2020.”

Tufts has implemented a number of changes as well, including compensating providers 100% of an in-office rate for telehealth, working with providers on a case-by-case basis to address their concerns regarding payment stability, extending premium payment periods for employers who need more time to make payments, and contributing $2 million to support those affected by the coronavirus outbreak in Massachusetts, Rhode Island, New Hampshire, and Connecticut.

Certainly, reports of soaring profits may persuade some lawmakers to revive proposals to cap insurers’ profits even more, but insurers say they are using their financial strength to help customers, hospitals, and doctors. In the New York Times report, AHIP also cited trends like waiving co-payments for COVID testing and treatment and paying for telemedicine visits, some of which the government has mandated be covered.

“From the very beginning,” AHIP CEO Matt Eyles said, “health-insurance providers have focused on being part of the solution.”

Joseph Bednar can be reached at [email protected]

Business of Aging Special Coverage

Safe at Home

By Mark Morris

Cheryl Moran

Cheryl Moran says she increased staffers’ hours and pay to make sure they worked only at the Atrium during the pandemic.

Beth Cardillo said the arrival of COVID-19 caused a “wildfire effect.”

As executive director of Armbrook Village, a senior-living community in Westfield that offers independent and assisted living, as well as memory care, Cardillo said the first days of the pandemic created huge challenges for healthcare professionals who faced major decisions while working with limited information.

For example, hospitals were only admitting COVID-positive patients if they had a fever and showed respiratory symptoms. Some seniors at Armbrook, however, were testing positive but manifesting different symptoms.

“We had someone who tested COVID-positive, but he didn’t have a fever or a respiratory problem,” she said. “He felt weak, fatigued, and he almost passed out.”

Cardillo’s call for an EMT to transport the positive-testing resident to the hospital was met with disappointment when she was told the hospital would not admit anyone for the coronavirus unless they had a fever or respiratory symptoms.

“At that time, no one knew there were a host of other symptoms,” she said. “It’s nobody’s fault because nobody knew.”

Cardillo informed Baystate Medical Center about residents who showed different symptoms for the coronavirus, and the hospital quickly sent a team of specialists in infectious disease and emergency medicine to Armbrook to further examine these cases.

“Incidents like this were happening all over the country,” Cardillo said. “It’s how we learned that people can manifest other symptoms but still have the coronavirus.”

Similarly, at the beginning of the pandemic, health officials were not encouraging everyone to wear masks; later, with better information, they shifted course. As information on all aspects of COVID-19 improved and safety guidelines were implemented across the U.S., senior-living facilities that already had sanitizing and infection protocols in place increased their efforts to battle the spread of coronavirus.

Emily Tamilio, Corporate Marketing director for Rockridge Retirement Community in Northampton, said her complex revamped its already-strong infection-control policies before the state went into lockdown. “We’ve redoubled our protocols and to make sure all our staff is up to date on proper infection control, hand washing, and strict sanitization procedures.”

Beth Cardillo

“We had someone who tested COVID-positive, but he didn’t have a fever or a respiratory problem. He felt weak, fatigued, and he almost passed out.”

Meanwhile, at Atrium at Cardinal Drive in Agawam — an assisted-living facility exclusively for people with memory loss — Executive Director Cheryl Moran imposed strict screening procedures to keep residents and staff safe, such as requiring all outside agencies to get her approval before they could enter the facility.

In the caregiving community, it’s not unusual for workers at one assisted-living facility to take a second part-time job at a similar site or earn additional income by providing care at a person’s home. Moran knew she had to address this vulnerability to keep the virus away. “I met with all our associates and offered more money, more hours, and different hours to encourage them to work only for the Atrium.”

Tamilio said Rockridge also offered additional pay and hours to keep staff working only at that facility. “Having our people just work for Rockridge was key to preventing transmission.”

Both Moran and Tamilio said encouraging staff to work only at one community is one of the main reasons neither campus has had any COVID-19 cases to date. It’s an example of how senior-living communities across Western Mass. had to be creative and aggressive — and continue to do so — to protect the most vulnerable population from a pandemic that’s far from over.

Visitation Consternation

In mid-March, the state issued guidelines for senior-living facilities to allow visitors only after they’ve had a health screening prior to their entry. When the pandemic first hit, all three communities BusinessWest spoke with said they restricted all outsiders except health providers and other essential personnel. Unfortunately, that meant families were not able to visit their loved ones in assisted living.

“As disappointing as that was, we had a solid communication process in place, and we were transparent about any changes, so it was much easier to get the families, residents, and staff on board,” Tamilio said.

Cardillo also stressed that communication was key, and personally checked in with every family member. “We were honest with people and let them know what was going on, and they appreciated that.”

As a further precaution for those in assisted living, the Executive Office of Elder Affairs mandated that everyone be quarantined in their apartments. No communal dining or walking around the halls was allowed.

Emily Tamilio

Emily Tamilio

“We’ve redoubled our protocols and to make sure all our staff is up to date on proper infection control, hand washing, and strict sanitization procedures.”

Cardillo noted that many residents in assisted living have cognitive impairments that make processing and retaining information difficult, so structure and constant communication are very important. Still, cognitively impaired residents who had been making progress before the quarantine began to backslide.

“They were confused again, depression was setting in, and their anxiety increased,” she recalled. “In some ways, the social isolation was almost worse than the virus.”

Staff dressed in full personal protective equipment (PPE) began meeting one-on-one with each resident in their apartment. Cardillo said reaching out and having conversations with the residents began to make them feel better.

Moran said the configuration of the Atrium made it possible to allow residents out of their apartments and still keep them safe. “Because we have the space, we were able to socially distance our residents while still allowing them to take part in modified programs and activities.”

As late spring arrived and the weather improved, residents in most communities were able to go outside more often and socialize with others. Cardillo said positive changes began to happen the minute residents were able to enjoy some fresh air. “Whether it was having a conversation or taking a walk or simply looking at the birds, we saw their depression and anxiety lessen once they could spend time outside.”

The warmer weather also enabled the facilities to resume family visits. Moran said the Atrium has a designated area for outdoor visits where families can schedule time with their loved ones either after breakfast or after lunch.

“We can only allow two family members at a time, and they have to wear masks,” she explained. “Unfortunately, they can’t hug or kiss their loved ones, so they do air hugs and things like that.”

Videoconferencing through platforms like Zoom, Skype, and FaceTime have been effective ways for families to stay connected — and send air hugs to their loved ones — when a physical visit is not possible. Tamilio said Rockridge staff will often work with families to coordinate a videoconference or even a phone call to help them feel connected during the pandemic.

“There are many times when our staff are the eyes and ears for the families of our residents, so we work very hard to stay in contact with them,” she told BusinessWest.

Using videoconferencing tools is one more way to be reassuring and transparent with families and staff, Moran added. “It’s important for families to know about the place where their mom and dad are living.”

Cardillo talked about a recent Zoom conference conducted like a town-hall meeting that included 80 resident family members, as well as Armbrook department heads. The purpose was to let everyone know what’s been done so far to keep residents healthy and engaged, and their plans going forward.

“Many family members had no idea about everything we’d gone through to keep their loved ones safe,” she said. “They want to do this type of meeting again.”

Meeting with potential new residents and their families is an important part of any senior-living community. The arrival of COVID-19 has moved much of that activity from in-person meetings to videoconferences. For families who want a tour of the facilities, Tamilio said virtual tours have been an effective alternative to an actual visit.

“We can connect them to our community and help them feel engaged,” she said. “Videoconferencing also allows us to bring together multiple family members from different locations to answer all their questions in one meeting.”

Cardillo is still able to meet with families in-person in Armbrook’s private dining area by using social distancing and requiring masks for everyone. Before the meeting, she will have a phone conversation and send information so that, when a family arrives for the meeting, they have some idea about the community.

“I will show them apartments, but we can’t wander around the building anymore,” she noted. “That’s the only thing that’s really changed.”

While Moran is not yet meeting in person, she depends on virtual tours and has identified a number of families willing to serve in an ambassador-type role.

“There are several family members of current and past residents who are willing to speak with new families about their experience here,” she said. “They are able to give their perspective on how things have been going for their loved ones.”

Winter Is Coming

Seven months into the pandemic, and with fall and winter coming, the Executive Office of Elder Affairs is allowing senior-living facilities to permit indoor visitation to specific areas of the building.

Moran said the Atrium will use office space in its main building to screen visitors and supply full PPE. She plans to limit visits to 30 minutes and restrict visitors to meeting in the front areas of the building.

A similar visitor policy will be in effect at Rockridge, which is about to install an air-purification system to use in common areas. The idea is to monitor air quality to make sure those areas are safe, especially as they begin to open the dining area and allow more visitors

“We are trying to find the right balance between mitigating risk and enhancing the quality of life for everyone here,” Tamilio said.

As the weather gets cooler, Cardillo is looking forward to bringing activities such as exercise classes indoors. There will be limits on the number of people who can participate at any one time, but that’s just part of life in these times.

She reflected on the challenges facilities like hers faced with the sudden arrival of the pandemic back in March, and how far they’ve come. “At the beginning, we were all learning together at the same time. With all that we’ve learned since then, we have a much better handle on things now.”

She said residents are in a much better frame of mind these days, with no COVID-19 cases reported in months.

All the administrators we spoke with said a spirit of cooperation — with everyone pitching in and constantly doing more than expected — has been a true highlight of these last six months. To acknowledge that spirit, Cardillo is planning a series of recognition ceremonies for her staff in the coming weeks.

“We had people who got very sick, and our staff did some beautiful things,” she said. “Sometimes it was just sitting with a resident and holding their hand. Their families were really touched by it.”

With the pandemic still a daily reality, Cardillo said she and her colleagues are better prepared if there is another flare-up of the virus.

“We hope it doesn’t happen, but we’re ready if it does.”

Commercial Real Estate Coronavirus Special Coverage

A Matter of Speculation

Ned Barowsky

Ned Barowsky is transforming 14,000 square feet of what was retail space into Venture X, a co-working concept, one of many signs of change within the region’s commercial real-estate market.

It was time to face facts, Ned Barowsky recalled.

For six months, two brokers assigned by a large, national real-estate firm had been trying to fill the vacancies left at Barowsky’s property at 98 Lower Westfield Road by the departure of Pier One Imports and Kaoud Oriental Rugs. And they had gotten … nowhere.

“I met with them on the phone weekly, and they sent me a sheet of everyone they talked to and e-mailed, and all the responses they got,” he said. “For six months prior to COVID, not one bite. And they worked it. I felt bad for them; I wanted to pay them, but they didn’t get me anybody.”

Faced with this handwriting on the wall and an uncertain future for the Holyoke property he has owned for nearly 35 years, Barowsky is doing what so many are doing in the midst of COVID-19, and in general. He’s pivoting — big time.

Indeed, he intends to remake those vacated storefronts, and some additional space at the complex, into a franchise for the emerging co-work concept known as Venture X, which bills itself as “the future of workspace” (more on that later).

This intriguing pivot is just one indication that the local commercial real-estate market is in a state of flux, if you will, with perhaps profound changes to come as the pandemic continues and its impact on this sector grows.

Indeed, there is already significant movement in the market when it comes to additional vacancies and properties becoming available. Meanwhile, there is widespread speculation that the office market in particular may see considerable disruption as businesses with some or most of their employees working remotely consider making such arrangements permanent.

“A remote work hub is basically converging living space with working space; you’re allowing people to get out of their house and into a work place that’s safe — and in close proximity to where they live.”

And even if they don’t swing that far when it comes to working arrangements, there are questions about how much of their present space they’ll retain when their lease is up.

“We have lost a few tenants, mostly due to non-renewals as companies look for ways to be more efficient and perhaps consolidate if they had multiple locations,” said Evan Plotkin, president of NAI Plotkin and co-owner of 1350 Main St. in Springfield, noting that Bay Path University, which occupies roughly 12,000 square feet, is one of these tenants.

But as some are downsizing or not renewing, others are actually taking more space to accommodate pandemic-era guidelines on social distancing and keep employees safe, said Plotkin, noting that he’s already seen such upsizing from a few tenants and expects more in the months to come.

In the meantime, new leases are being signed, and properties are being acquired, said Demetrios Panteleakis, a principal with MacMillan Group LLC, which has authored what could certainly be called a stunning turnaround at Tower Square in downtown Springfield.

Over the past 24 months or so, Panteleakis said, MacMillan has successfully backfilled roughly 80% of the 150,000 square feet of office space in the complex that MassMutual vacated, with about a third of that coming in just the past few months.

The latest additions in the office tower include Wellfleet and Farm Credit Financial Partners, which moved into 37,500 square feet on the sixth floor, but also a few law firms and a civil-engineering firm. Meanwhile, on the retail side, the Greater Springfield YMCA moved several of its operations last winter, White Lion Brewery is completing work on its brewery and eatery in the former Spaghetti Freddy’s space, and a nail salon has moved in. And all this is on top of a massive renovation of the hotel on the property into a new Marriott.

“Tower Square is absolutely on fire,” he said, adding that he believes the success at that address has been a function of providing an attractive product in a good location, in this case an urban area in the midst of what has been called a renaissance.

Demetrios Panteleakis says activity has been strong at Tower Square

Demetrios Panteleakis says activity has been strong at Tower Square in recent months, with new leases signed for both retail and office space.

Mitch Bolotin, a principal with Springfield-based Colebrook Realty Services, agreed that there has been activity within the market despite the pandemic, noting that his firm has completed a number of transactions, including the sale of the property at 95 Elm St. in West Springfield formerly occupied by United Bank, the Newman Center on the UMass Amherst campus, and lease of the former Chandler’s restaurant space at the Yankee Candle complex in South Deerfield, among others.

The $64,000 question is … what happens now?

No one really knows the answer. Many brokers are encouraged by numerous stories in recent weeks about both productivity being down as a result of remote working and pent-up desire to return to the office. But these sentiments are juxtaposed against others indicating that remote work has been a success and, as a result, less office space will be leased in the future.

Speaking for others, Panteleakis said there will likely be a lull or pause in the action until perhaps the end of the first quarter of next year as business owners sort some things out.

Work in Progress

Plotkin calls it a “remote work hub.”

That’s a term he borrowed from a request for proposals he’s likely to respond to, and it describes … well, a place where people can both live and work. But not like the current work-from-home environment many are now experiencing.

“A remote work hub is basically converging living space with working space; you’re allowing people to get out of their house and into a work place that’s safe — and in close proximity to where they live,” said Plotkin, adding quickly that he’s thinking hard about whether 1350 Main St. can be shaped into one of these remote work hubs. He thinks it can.

“I have a design here that works great,” he told BusinessWest. “We have some empty floors, and if we created maybe 20 units per floor and used the three floors that are empty, that would be 60 market-rate housing units. And if you had another floor that was a COVID-19 pandemic remote work space, which has yet to be designed, I think you’d have something very attractive.

“The idea is to make people feel that they can go someplace to work and not be in their kitchen, not be in their living room, and actually have some socialization and see other people,” he went on, adding that such a facility would help attract people of all ages, but especially young people, to downtown Springfield.

The fact that Plotkin is thinking about such a dramatic pivot provides more evidence that the commercial real-estate market is changing and there are certainly question marks about how — and how profoundly — the landscape may change.

The remote-work phenomenon, if it can be called that, is certainly at the heart of much of this speculation. Indeed, as more workers toil from home for longer periods — some of the massive tech companies have told employees they won’t be coming back for a year, at least — questions are raised about whether such arrangements will become permanent, and what this means for major urban centers and individual office facilities.

Barowsky, for one, believes that companies will be less likely to want to tie themselves down with long-term leases for large amounts of space. And that’s one of the reasons why he’s moving forward with Venture X.

A Holyoke native who has seen a number of economic cycles and an ongoing evolution of the area’s retail scene, Barowsky believes this co-work space is certainly the right concept at the right time — and especially the right place.

“I don’t think you get this energy that you have when people are working together in one office, and you don’t see the productivity.”

Indeed, the site, just a few hundred yards from the Holyoke Mall, is right off I-91 exit 15 and only minutes off exit 4 of the Mass Pike.

“This is literally the crossroads of New England,” said Barowsky, adding that this address makes the Venture X facility attractive for businesses across a number of sectors.

Add all these factors up, and Barowsky doesn’t see this dramatic pivot — away from retail and into co-working space — as much of a gamble. And if it is a gamble, it’s one he believes will pay off eventually, perhaps sooner than later.

Indeed, he said the current timeline doesn’t have him opening the doors for another six months, but he’s already received a number of inquiries about his concept.

Questions and Answers

While Barowsky doesn’t have any doubts about his new development, there is a growing amount of uncertainty when it comes to the larger commercial real-estate market.

And it crosses many of the sectors within that realm, including retail — which was already under considerable stress before COVID-19 due to online buying and now is under even more — and especially the office market because of questions about the future of work.

“At this point, I think the jury is still out — the verdict is not in yet,” Plotkin said. “There’s been an abrupt change in how we work, and it has required us to work remotely. It’s been a complete lifestyle change, and it’s created a fair amount of fear. And those converging factors may prevail over a long period of time; we just don’t know.”

Panteleakis agreed to some extent, but said he concurs with JPMorgan Chase Chairman and CEO Jamie Dimon, who recently told American Banker that he sees economic and social damage from a longer stretch of working from home.

“Between 2002 and 2005, there was a big movement happening — commercial real estate had become so expensive that everyone was trying remote working,” he recalled. “Jamie Dimon is saying the same thing that everyone was saying back then — that they see a decrease in productivity. So I think real estate is coming back; I don’t think you get this energy that you have when people are working together in one office, and you don’t see the productivity.”

Plotkin concurred. “Today, people can work from anywhere, and it’s appealing to people to work from anywhere. But the reality is that working from home is isolating, and I don’t think that’s a long-term solution.”

Added Bolotin, “there is a lot of speculation on both sides of that fence. I believe that the office market will still have a future — there will still be demand. Working from home is fine on a limited basis, but people will eventually migrate back to an office setting.

“Needs might change,” he went on. “They may need to consolidate, or they may wish to add more space for social-distancing purposes. But what the net effect of this will be … time will tell.”

Returning to the present, those we spoke with said there are certainly some deals getting done, and the market remains active. Panteleakis cited not only Tower Square, but also neighboring 1550 Main St., which he also handles, and which is fully occupied.

Bolotin, citing those recent transactions in West Springfield, Amherst, South Deerfield, and other communities his firm was involved with, said they provide evidence of a resilient economy and an equally resilient commercial real-estate market, one that has seen a number of downturns — and recoveries.

“We’re very active, we’re busy, there are transactions happening,” he said of his firm but also the market overall. “Over the past few months, we’ve had deals close across a number of categories — office, retail, industrial, land, investments. We’ve had activity in all segments.”

Some of these transactions bode well for the region and some of its individual communities, he noted, such as the sale of 95 Elm St. in West Springfield. Considered a key to development of the downtown area, the property is being targeted for a mix of office and retail, said Bolotin, and his firm is currently negotiating several potential leases in that building.

Meanwhile, other deals have been closed involving retail (two Family Dollar stores), industrial (more than 500,000 square feet in total), and even a few church properties.

“It is certainly a challenging time, and there are people who have been negatively impacted,” he stressed. “But there is still activity within the marketplace.”

Bottom Line

As for the immediate future … Panteleakis said a pause, or lull, is common just before presidential elections. And this year, COVID-19 has given business owners and managers more reason to be cautious.

“People are in a wait-and-see mode,” he explained. “Most of the executives that I’ve spoken with are waiting to see what happens in the first quarter of 2021. So I think the jury will be out until that first quarter of next year.”

After that … no one really knows when the jury will actually be back and what the verdict will be.

But some are already anticipating long-term changes to the landscape. That’s why Venture X is taking shape in Holyoke and why Evan Plotkin is drafting plans for a remote work hub.

Plenty of questions remain about the future, and the answers won’t come easily.

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

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 30: Sept. 28, 2020

George Interviews James Leahy, Holyoke City Councilor

George O’Brien talks with James Leahy, Holyoke City Councilor, official with the Massachusetts State Lottery, and one of five finalists for the magazine’s coveted Alumni Achievement Award. The two discuss his 20-year track record of service to the community as well as recent developments in Holyoke, from the emergence of a cannabis sector in this historic mill town to efforts to bring new businesses to the mills that give this city its heritage.

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Cover Story Education Special Coverage

Writing the Next Chapter

Robert Johnson, president of Western New England University

Robert Johnson, president of Western New England University

At least once, and perhaps twice, Robert Johnson strongly considered removing himself from the mix as a search committee narrowed the field of candidates to succeed Anthony Caprio as president of Western New England University (WNEU) in Springfield.

It was early spring, and the COVID-19 pandemic was presenting every institution of higher learning, including UMass-Dartmouth, which he served as chancellor, with a laundry list of stern — and, in some cases, unprecedented — challenges.

Johnson told BusinessWest that the campus needed his full attention and that it might be time to call a halt to his quest for the WNEU job. But he “hung in there,” as he put it, and for the same reason that he eventually decided to pursue the position after at least twice telling a persistent recruiter that he wasn’t really interested.

“We are at an inflection point in higher education,” said Johnson, who arrived on the campus on Aug. 15, just a few weeks before students arrived for the fall semester. “Western New England has a good balance of the liberal arts and the professional schools, along with the law school, that puts it in a unique position to write the next chapter when it comes to what higher education will look like.

“I think it’s fair to say that, when we think about higher education, the last time we’ve seen the level of transformation that is about to happen was just after World War II, with the GI Bill and the creation of more urban public universities, community colleges, and the list goes on,” he continued, as talked through a mask to emphasize the point that they are to be worn at all times on this campus. “As we think about the world of work and the future, colleges and universities will be educating people for jobs that don’t exist yet, utilizing technologies that haven’t been created to solve problems that have yet to be identified.”

Elaborating, he said today’s young people, and he counts his son and daughter in this constituency, are expected to hold upwards of 17 jobs in five different industries (three of which don’t currently exist) during their career. All this begs a question he asked: “what does an institution of higher learning look like in an environment like this, where the pace of change is unlike anything the world has ever seen?”

The short answer — he would give a longer one later — is that this now-101-year-old institution looks a whole lot like WNEU, which, he said, is relatively small, agile, and able to adapt and be nimble, qualities that will certainly be needed as schools of all sizes move to what Johnson called a “clicks and mortar” — or “mortar and clicks” — model of operation that, as those words suggest, blends remote with in-person learning.

The process of changing to this model is clearly being accelerated by the pandemic that accompanies Johnson’s arrival at WNEU, and that has already turned this fall semester upside down and inside out at a number of schools large and small.

“Western New England has a good balance of the liberal arts and the professional schools, along with the law school, that puts it in a unique position to write the next chapter when it comes to what higher education will look like.”

Indeed, a number of schools that opened their campuses to students have already closed them and reverted to remote learning. Meanwhile, others trying to keep campuses open are encountering huge problems — and bad press: Northeastern University recently sent 11 students packing after they violated rules and staged a gathering in one of the living areas, for example, and the University of Alabama has reported more than 1,200 cases on its campus in Tuscaloosa.

It’s very early in the semester, but Johnson is optimistic, even confident, that his new place of employment can avoid such occurrences.

“The decision to go with in-person learning was essentially made before I got here, and I think it was the right decision,” he explained, noting that students are living on campus and only 16% of the courses are being taught fully online, with the rest in-person or a hybrid model. “We’ve tested more than 2,500 individuals, and we’ve had only three positive cases, all asymptomatic. It’s worked out well so far, but this is only the end of the first week.

“We’re cautiously optimistic, and we take it day to day,” he went on, adding that the school’s smaller size and strict set of protocols, such as testing students upon arrival, may help prevent some of those calamities that have visited other institutions. “We’ve been very judicious, and our small size makes us a bit different. We’re kind of like Cheers, where everybody knows your name; we don’t have tens of thousands of students that we have to manage.”

For this issue and its focus on education, BusinessWest talked with Johnson about everything from the business of education in this unsettled time to the next chapter in higher education, which he intends to help write.

Screen Test

Flashing back to that aforementioned search for Caprio’s successor, Johnson noted that it was certainly different than anything he’s experienced before — and he’s been through a number of these, as we’ll see shortly.

Indeed, this was a search in the era of COVID-19, which meant pretty much everything was done remotely, including the later rounds of interviews, which usually involve large numbers of people sitting around a table.

Robert Johnson says he’s confident

Robert Johnson says he’s confident that WNEU, a smaller, tight-knit school, can avoid some of the problems larger institutions have had when reopening this fall.

“It was all Zoom, and it was … interesting,” he said of the interview process. “You don’t know if you’re truly connecting or not. As a person being interviewed, you have much more self-awareness of not only what you’re saying but how you’re saying it, and your own non-verbal communication, because you can see yourself on the screen.

“You have to make sure your background is right, the lighting is right, you’re wearing the right colors, all that,” he went on. “It’s like being on TV, literally, because the first impression people get is what they see on screen.”

Those on the search panel were nonetheless obviously impressed, both by what they saw and heard, and also the great depth of experience that Johnson brings to this latest stop in a nearly 30-year career in higher education.

Indeed, Johnson notes, with a discernable amount of pride in his voice, that he has worked at just about every type of higher-education facility.

“I worked in every not-for-profit higher-education sector,” he noted. “Public, private, two-year, four-year, private, Catholic, large, medium, and small — this is my seventh institution. And I think that gives me a unique lens as a leader in higher education.”

Prior to his stint at UMass Dartmouth, he served as president of Becker College in Worcester from 2010 to 2017, and has also held positions at Oakland University in Michigan and Sinclair College, the University of Dayton, and Central State University, all in Ohio.

As noted earlier, when Johnson was invited by a recruiter to consider perhaps making WNEU the next line on his résumé, he was at first reluctant to become a candidate.

“The search consultant, who I happen to know, called me two or three times, and I did not bite,” he noted. “But as she told me more, and I learned more about Western New England University, I began to take a look. I knew about the school, but I had never taken a deep dive into the institution, its history, and what it had to offer.”

He subsequently took this deep dive, liked what he saw, and, as he noted, hung in through the lengthy interview process because of the unique opportunity this job — at this moment in time — presented.

Since arriving on campus, he has made a point of meeting as many staff members and faculty as possible, but this, too, is difficult during the COVID-19 era. Indeed, meetings can involve only a few participants, so, therefore, there must be more of them.

“We can’t have any of those big ‘meet the president’ meetings,” he noted. “So I’ve had six, seven, or eight meetings with small groups or facility and staff, and I probably have another 15 or 20 of those scheduled. I’m getting to know people, and they’re getting to know me; I’m doing a lot of listening and learning.”

Overall, it’s a challenging time in many respects, he said, adding quickly that higher education was challenging before COVID, for reasons ranging from demographics — smaller high-school graduating classes, for starters — to economics and the growing need to provide value at a time when many are questioning the high cost of a college education.

“The business model for higher ed was going to change regardless — I think, by 2025, given demographics and a whole host of other things, colleges and universities were going to have to figure out how to do business differently,” he told BusinessWest. “I think COVID, overnight, expedited that.

“The business model for higher ed was going to change regardless — I think, by 2025, given demographics and a whole host of other things, colleges and universities were going to have to figure out how to do business differently. I think COVID, overnight, expedited that.”

“It was a Monday, and seven to nine days later, every college in the country was teaching remotely and working remotely, in ways we never imagined,” he continued. “So the very idea that colleges and universities will go back to 100% of what that old business model was is a non-starter. So the question is, ‘how do we reinvent ourselves?’”

Courses of Action

As he commenced answering that question, he started by addressing a question that is being asked in every corner of the country. While there is certainly a place for remote learning, he noted, and it will be part of the equation for every institution, it cannot fully replace in-person learning.

“Some would say that online learning is the way, and the path, of the future,” he noted. “I would say online learning is a tool in terms of modality, but it is not the essence of education.”

Elaborating, he said that, for many students, and classes of students, the in-person, on-campus model is one that can not only provide a pathway to a career but also help an individual mature, meet people from different backgrounds, and develop important interpersonal skills.

“Some would say that online learning is the way, and the path, of the future. I would say online learning is a tool in terms of modality, but it is not the essence of education.”

“For the student coming from a wealthy family, I think they need socialization, and they need a face-to-face environment,” he explained. “For the first-generation student whose parents did not go to college, I think they need socialization. And for students who come from poor families, they need socialization.

“My point being that online learning is not a panacea,” he continued. Some would argue that, if you have online learning, it would help poor kids go to college. I would say that the poor kids, the first-generation kids, are the very ones who need to be on that college campus, to socialize and meet people different from themselves. And the same is true for those kids coming from the upper middle class and wealthy families — they need that socialization.

“In my humble opinion, face-to-face never goes away,” he went on. “But does that mean that one might be living on campus five years from now, taking five classes a semester, with maybe one or two of them being online or hybrid? Absolutely. I think the new model is going to be click and mortar, or mortar and click.”

Expanding on that point while explaining what such a model can and ultimately must provide to students, he returned to those numbers he mentioned earlier — 17 jobs in five industries, at least a few of which don’t exist in 2020. Johnson told BusinessWest that a college education will likely only prepare a student for perhaps of the first of these jobs. Beyond that, though, it can provide critical thinking skills and other qualities needed to take on the next 16.

“That very first job that a student gets out of college — they’ve been trained for that. But that fifth job … they have not been trained for that,” he said. “And I think the role of the academy in the 21st century, the new model, is all about giving students and graduates what I call the agile mindset, which is knowledge and the power of learning — giving students essential human skills that cannot be replicated by robots and gives them the mindset to continually add value throughout their professional careers.

“We’re educating people to get that first job, and to create every job after that,” he continued. “We’re making sure that every person who graduates from college is resilient and has social and emotional intelligence and has an entrepreneurial outlook, which is not about being an entrepreneur; it’s about value creation and having those essential human skills. What that means, fundamentally, is that no algorithm will ever put them out of a job.”

To get his point across, he relayed a conversation he had with some students enrolled in a nursing program. “They said, ‘this doesn’t apply to us,’ and I said, ‘yes, it does, because there are robots in Japan that are turning patients over in hospitals. So if you think technology does not impact what you do, you’re mistaken.’”

Summing it all up, he said that, moving forward, and more than ever before, a college education must make the student resilient, something he does not believe can be accomplished solely through online learning.

“How do I put the engineer and the artist together, give them a real-world problem, and say, ‘have at it, go solve it?’” he asked. “They have to be face to face, hands-on. We can come up with alternate reality, virtual reality, and all the technology you want, but at some point, people have to sit down and look each other in the eye.”

Bottom Line

Returning to the subject of the pandemic and the ongoing fall semester, Johnson reiterated his cautious optimism about getting to the finish line without any major incidents, and said simply, “get me to Thanksgiving with everyone still on campus.” That’s when students will be heading for a lengthy break after a semester that started early (late August) and, to steal a line from Bill Belichick, featured no days off — classes were even in session on Labor Day.

But while he wants to get to Thanksgiving, Johnson is, of course, looking much further down the road, to the future of higher education, which is, in some important respects, already here.

He believes WNEU represents that future, and that’s why he “hung in there” during that search process.

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

Community Spotlight Special Coverage

Punching Back

Peter Picknelly, left, and Andy Yee

Peter Picknelly, left, and Andy Yee are partnering in a restaurant project at the former Court Square Hotel property.

Springfield Mayor Domenic Sarno noted that his city is certainly well-versed in dealing with natural and man-made disasters — everything from the tornado in June 2011 to the natural-gas explosion a year and a half later.

“Battle-tested” was the phrase he used to describe a community that has been though a lot over the past few decades.

But the COVID-19 pandemic … this is a different kind of disaster.

The new façade of the Tower Square Hotel, which expects to be under the Marriott flag next spring.

“It’s like shadow boxing in a lot of ways,” he said, using that phrase to essentially describe a foe that’s hard to hit and an exercise that amounts to punching air. “With those other disasters, I knew what hit us, and I knew how to jab back; with COVID-19, we don’t know when it’s going to go away, and we don’t know what’s going to happen next.”

But the city is certainly punching back against the pandemic, said the mayor and Tim Sheehan, the city’s chief Development officer, noting that it has undertaken initiatives aimed at everything from helping small businesses keep the doors open to assisting residents with paying their mortgage, rent, and utility bills.

And while the pandemic has certainly cost the city some vital momentum, the development community, which usually takes a long view, remains bullish on the city, said Sheehan, noting that there has been strong interest in projects ranging from the former School Department headquarters building on State Street to properties in the so-called ‘blast zone’ (damaged by that aforementioned natural-gas explosion), to buildings in the general vicinity of MGM Springfield in the city’s South End.

“One of more positive things we’re seeing is that development interest in Springfield remains strong,” he told BusinessWest. “And for some larger-scale projects, it’s new interest, from outside the area. And that bodes well for the whole effort that’s been made in terms of the downtown renaissance and the casino development; the development community’s message on Springfield is a good one.”

In the meantime, some projects are already moving forward, most notably the conversion of the long-dormant former Court Square Hotel into apartments and retail space, but also the extensive renovations (although that’s not the word being used) at the Tower Square Hotel in anticipation of regaining the Marriott flag that long flew over the facility, the new Wahlburger’s restaurant going up next to MGM Springfield, the new White Lion Brewery in Tower Square, the conversion of the former Willys-Overland building on Chestnut Street into market-rate housing, movement to reinvent the Eastfield Mall, a plan to redevelop Apremont Triangle, and much more.

But despite these projects, and despite the mayor’s confidence that the city will rebound quickly once the pandemic eases, there are certainly concerns about what toll the pandemic will take on existing businesses, especially those in retail, hospitality, and the commercial real-estate sector — specifically, the office towers downtown.

Mayor Domenic Sarno

Mayor Domenic Sarno says he’s confident that the city can make a strong — and quick — rebound from COVID-19.

There is strong speculation that businesses that now have some or most employees working remotely will continue with these arrangements after the pandemic eases, leaving many likely looking for smaller office footprints. Sheehan noted that such potential downsizing might be offset by businesses needing larger spaces for each employee in a world where social distancing might still be the norm, but there is certainly concern that the office buildings that dominate the downtown landscape will need to find new tenants or new uses for that space.

“There’s some conflicting data out there — the average size of a typical commercial office lease was going down prior to COVID, and a big reason was the rise of the communal working space,” he explained. “Well, now, the communal working space isn’t working so well anymore; there are some impacts that are forcing companies to require more space, not less.

“It’s like shadow boxing in a lot of ways. With those other disasters, I knew what hit us, and I knew how to jab back; with COVID-19, we don’t know when it’s going to go away, and we don’t know what’s going to happen next.”

“Still, before COVID, the vacancy rate for commercial real estate was somewhat high,” he went on. “We collectively need to be working with the building owners and businesses to make sure those numbers don’t exacerbate as we come out of COVID. But, clearly, there is concern about the commercial real-estate market.”

For this, the latest installment in BusinessWest’s Community Spotlight series, the focus turns to the unofficial capital of the region, the current battle against COVID-19 and the many forms it takes, and the outlook for the future, both short- and long-term.

View to the Future

As he walked around the former Court Square Hotel while talking with BusinessWest about his involvement with the project to give the landmark a new life, Peter A. Picknelly pointed to the windows in the northwest corner of the sixth floor, and noted that this was where a City Hall employee had just told him she wanted to live as he and business partner Andy Yee were leaving a meeting with the mayor.

But then he quickly corrected himself.

“No, she was referring to that corner,” he noted, pointing toward the windows on the northeast side, the ones with a better overall view of Court Square and Main Street. “That’s the one she said she wanted.”

Talk about actually living in the still-handsome structure that dominates Court Square is now actually real, whereas for the better part of 30 years it had been nothing but a pipe dream. That’s how long people have been talking about renovating this property, and that’s how challenging this initiative has been.

Indeed, like Union Station, another project that took decades to finally move beyond the talk stage, Court Square’s redevelopment became real because of a public-private partnership with a number of players, ranging from Picknelly’s Opal Development and WinnCompanies to MGM Springfield, to the city, the state, and federal government.

“This project was a bear, and that building was an albatross around the neck of a lot of mayors,” Sarno said. “This was all about persistence and not giving up when it would have been easy to do that.”

As for Picknelly, this is a legacy project of a sort, he said, noting that his father, Peter L. Picknelly, had long talked about creating a boutique hotel at the site — which, after its days as a hotel, was home to a number of law offices because of its proximity to the courthouse — as a way to inject some life into a still-struggling downtown.

Chief Development Officer Tim Sheehan

Chief Development Officer Tim Sheehan says the city’s first priority has been to assist businesses and help ensure they’re still in business when the pandemic eases.

The boutique-hotel concept became less viable as new hotels were built in the city, he went on, but the urgent need to convert the property for a new use — identified as the top priority in the Urban Land Institute study completed more than a decade ago — remained.

“How can Springfield really see its full potential if this building is vacant?” asked Picknelly, who again partnered with Yee — the two have resurrected both the Student Prince and the White Hut — to create a restaurant in the northwest corner of the property (more on that in a bit). “This is going to be the centerpiece of Springfield’s renaissance.”

The Court Square project is just one example of how things are moving forward in the city, even in the midst of the pandemic, said Sheehan, noting that, in the larger scheme of things, Springfield remains an attractive target for the development community — and for the same reasons that existed before the pandemic, namely an abundance of opportunities, growing momentum in the central business district, the casino, Union Station, the burgeoning cannabis industry, and more.

Still, the the pandemic has certainly been a major disruptive force in that it has imperiled small businesses across many sectors, especially hospitality; brought a relative stillness to the downtown area as many employees continue to work at home; closed the casino for nearly four months and forced it to reopen at one-third capacity; cancelled all shows, sports, and other gatherings at the casino, the MassMutual Center, Symphony Hall, and elsewhere; and even forced the Basketball Hall of Fame to reschedule its induction ceremonies (normally held this month) to the spring and move them to Mohegan Sun.

So the first order of business for the city has been to try to control, or limit, the damage, said Sarno and Sheehan, adding that it has been doing this in a number of ways, including its Prime the Pump initiative.

The Court Square project

The Court Square project, roughly 30 years in the making, was made possible by a comprehensive public-private partnership.

The program, using Community Development Block Grant monies, has provided small grants to city businesses in amounts up to $15,000. The awards have come over several rounds, with the first focused on restaurants, perhaps the hardest-hit individual sector, with subsequent rounds having a broader focus that includes more business sectors and nonprofits. Sheehan said businesses receiving grant funds have also represented a diversity of ownership.

“Prime the Pump numbers in terms of minority representation were huge — more than 72% of the awards were to minority-owned, women-owned, or veterans, and all of the nonprofits we supported had 30% or more minority participation on their board of directors,” he explained, adding that these numbers are significant because many minority-owned businesses had difficulty attaining other forms of support, such as Paycheck Protection Program loans.

In addition to helping businesses weather the storm, the city has also provided financial assistance to residents, said the mayor, noting that this aid has gone toward paying mortgages, utility bills, and rent, assistance that also helps the city’s many landlords.

“In this region, I don’t think any community has done more to help their businesses and their residents,” Sarno noted. “We have put out well over $5 million, and perhaps $6 million. We’ve been very proactive, and we’re going to continue working with businesses, such as our restaurants, to help them stay open.”

Such support is critical, said Sheehan, because in order to rebound sufficiently once the pandemic subsides, consumers will need to find outlets for that pent-up demand the mayor mentioned.

“How can Springfield really see its full potential if this building is vacant? This is going to be the centerpiece of Springfield’s renaissance.”

“When there is a vaccine, or when our numbers are so low that people feel safe and feel willing to go back out, the responsiveness will be there,” he noted. “My concern is making sure that the businesses we have are still in business when we get there.”

When We Meet Again

While he talked about COVID-19 using mostly the present tense, Sarno also spent a good deal of time talking about the future.

He said the pandemic will — eventually and somehow — relent. And, as he said earlier, he is confident the city will rebound, and quickly, and perhaps return to where it was before ‘COVID’ became part of the lexicon. For a reference point, he chose Red Sox Winter Weekend in January, an event staged by the team but hosted by MGM Springfield. It brought thousands of people to the city, filling hotels and restaurants and creating traffic jams downtown as motorists tried to maneuver around closed streets and various gatherings.

In many ways, Red Sox Winter Weekend is emblematic of all that’s been lost due to the pandemic. It won’t all come back overnight, Sarno and Sheehan noted, but the vibrancy will return.

“COVID-19 has really knocked us for a bit of a loop,” the mayor said, stating the obvious. “But I think there there’s a lot of pent-up … not only frustration, but desire to get back out there, so when we defeat this, I really think we’re going to rebound very nicely, and even quickly, because we continue to move projects forward and put new projects on the board.”

Tower Square Hotel

These renderings show what the front lobby (above) and ballroom will look like in the Tower Square Hotel that is being ‘reimagined’ and ‘redesigned’ and will soon be flying the Marriott flag.

This optimism extends to MGM, which had been struggling to meet projections (made years ago) for gross gambling revenue before the pandemic, and has, as noted, been operating at one-third capacity since early summer, with the hotel and banquet facilities closed.

“When MGM was hustling and bustling, with shows coming in, downtown was thriving,” Sarno said. “I’m hoping that, as we head into the last quarter and eventually the holiday season, if people can regain their confidence in going out to places like this, we see things pick up.”

And there will be some positive changes to greet visitors as they return, starting with a new Marriott.

Indeed, work continues on a massive project that Peter Marks, general manager of the hotel, insists is not a renovation, because that word doesn’t do justice to the massive overhaul. He instead said the hotel has been “reimagined” and “redesigned.”

Indeed, slated to open — or reopen, as the case may be — next spring or summer, the 266-room facility is getting a new look from top to bottom, inside and out. The most visible sign of the change is a new, more modern façade that greets visitors coming over the Memorial Bridge. But the entire hotel is being made over to new and stringent standards set by Marriott.

“This is not a reflagging; it’s a new build, and that’s why the work is so extensive,” he explained. “Everything that that a guest could see or touch is being replaced. Beyond that, we’ve moved walls, we’ve moved emergency staircases in the building to accomplish higher ceilings … it’s impressive what has been done.”

The timing of the project — during the middle of a pandemic — has been beneficial in one respect: there was minimal displacement of guests due to the ongoing work and, therefore, not a significant loss of overall business. But the pandemic has also been a hindrance because it’s made getting needed construction materials much more difficult, causing delays in the work and uncertainty about when it can all be completed.

“You might get a shower wall in, but not the shower tub,” Marks explained. “And you can’t do the wall without the tub, so you have to wait, and this happens all the time. If everything goes smoothly from here, it might be April when we reopen, or it could also be summer.”

By then, he thinks the world, and downtown Springfield, will look considerably different, and there will be a considerable amount of pent-up demand.

“Especially for the leisure travelers,” he said. “People are really itching to get out; they’re all waiting to go somewhere, and also go to events, weddings, family reunions, and other celebrations. I’m hopeful that we’ll be opening right when the pent-up demand is coming.”

As for the restaurant planned for the Court Square property, Picknelly and Yee project it will be open for business by the fall of 2022, and that, when it does debut, it will be an important addition to a downtown that may look somewhat different, but will likely still be a destination and a place people not only want to visit, but live in.

“Winn has done 100 renovation projects like this around the country,” Picknelly said. “They are 100% convinced that this building will be fully occupied by the time we open — there’s no doubt in their minds, based on the projections. I think that says a lot about people still wanting to live in urban areas, and I think it says a lot about Springfield and what people think of this city.”

Fighting Spirit

Returning to his analogy about shadow boxing, Sarno said COVID-19 has certainly proven to be a difficult sparring partner.

Unlike the tornado, which passed through quickly and left a trail of destruction to be cleaned up, COVID has already lingered far longer than most thought it would, and no one really knows for sure how much longer we’ll be living with it.

Meanwhile, as for the damage it will cause, there is simply no way of knowing that, either, and the toll creeps higher with each passing week.

But, as the mayor noted, the city is already punching back, and it intends to keep on punching with the goal of regaining the momentum it has lost and turning back the clock — even if it’s only six or seven months.

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

Berkshire County Special Coverage

Delivering the Message

A team from Graphic Impact Signs installs a sign for Berkshire Bank.

A team from Graphic Impact Signs installs a sign for Berkshire Bank.

John Renzi says that, when the pandemic arrived in mid-March, the sign industry, like most all others, was hit hard.

Indeed, as a sector that has always been a good barometer of the economy and one that suffers greatly during downturns, the sign business was impacted by the pandemic in a number of ways, said Renzi, a principal and account executive with Pittsfield-based Graphic Impact Signs (GIS). He listed everything from the prompt shutdown of the events, sports, and entertainment industries and a halt to orders from those solid customers, to disruptions in the supply chain that have hindered many players in this large and diverse field from completing orders they do have.

GIS has certainly not been immune from any of this, said Renzi, but he believes the company acquired by his father 33 years ago has fared better than most because of the two traits that have defined it from the beginning: flexibility and resiliency.

They have been displayed in everything from how the company has pivoted and started making new lines of products, such as the plexiglass barriers now seen in all kinds of businesses, to how it has maneuvered its way through those supply-chain issues by working with suppliers and stockpiling essential materials that are now in very short supply.

Regarding those barriers, or shields, the company tacked in that direction as the business world paused and sign work all but stopped as the pandemic arrived, he noted, and very quickly had product moving out the doors of the Pittsfield plant.

“We had the equipment, and we had the supply,” he told BusinessWest. “So we were able to move from idea to prototype to our first order, which was a $138,000 order, in seven working days. That’s the flexibility we have, and it has allowed us to be successful.”

That same flexibility is effectively serving the company as it transitions back to making signage, said Dan Renzi, John’s brother and partner, especially when it comes to supply-chain issues.

“Many of our suppliers just stopped delivering for quite some time, and then, when they started up again, the manufacturers just could not get the product to us,” he explained, referring specifically to the white polycarbonate needed in most sign projects. Working with existing and new suppliers, GIS has been able to stockpile and warehouse this essential product while some competitors are waiting for what could be three or four months to get what they need.

Thus, the company is well-positioned, even in the middle of a pandemic, to broaden an already-impressive portfolio that includes clients such as Big Y, General Dynamics, and a host of banks and credit unions, especially those installing interactive teller machines (ITMs).

GIS has become an industry leader in making the surrounds, or canopies (see photo, page XX), for these devices, and it is now making them for Berkshire Bank, PeoplesBank, Country Bank, bankESB, and several other institutions.

“The ATMS are on their way out, and the ITMs are moving in,” John noted. “More banks are expanding into this because it’s clearly the future, and we’re one of the leaders in making signage and surrounds for these ITMs.”

Dan Renzi, left, and his brother, John, stand in front of a new sign made for Big Y.

Dan Renzi, left, and his brother, John, stand in front of a new sign made for Big Y.

This status, coupled with the company’s flexibility and its ability to work with clients to design, develop, and install signage that is indeed impactful, has it very well-positioned for the future.

“Over the years, we’ve seen people come in with, literally, something scribbled on a piece of paper,” said Dan, explaining how GIS is involved with the client from start to finish. “We’ll take things from that really rough sketch to a complete, finished product all in one building; we can take a dream and turn it into reality.”

For this issue and its focus on Berkshire County, BusinessWest turns its lens on GIS and how it has been able to use its flexibility and resiliency to not only ride out the pandemic, but take new and meaningful steps forward.

More Signs of Progress

It’s not an official indicator of how a sign business, or any other business, for that matter, is faring. But the Renzi brothers consider it one, and they’re quite proud of it.

They were referring to how signs that have the company’s name on it — albeit in small letters that you probably wouldn’t notice (although the brothers do) — have shown up in some recent movies and TV series coming out of Hollywood.

“We had the equipment, and we had the supply. So we were able to move from idea to prototype to our first order, which was a $138,000 order, in seven working days.”

“That’s pretty cool when you’re sitting there at a movie, either on Netflix or on the big screen, and you see one of your signs,” said John, noting that some of the company’s installations have become backdrops recently in the movies Knives Out and Behind the Woods, and the true-crime TV series Dirty John.

These recent on-screen appearances are merely the latest … well, signs of continued growth and prosperity for a company that has been part of the landscape in the Berkshires for more than 60 years. Known first as Alfie Sign Co., the business caught the eye of John Renzi Sr., a painter whose portfolio was dominated by commercial clients at a time when Pittsfield was certainly seeing its fortunes wane as its main employer, General Electric, was closing its massive complex.

“GE was moving out, and his painting business was commercial business only,” said John Jr. “So when you had large businesses moving out of Pittsfield, he was trying to set up a future for my brother and me.”

The company had a solid reputation and an impressive client list, he went on, noting that it had created signs for Fayva Shoes, Subway — it was involved in the first-generation logo for that chain — and D’Angelo’s, among others. But it wasn’t exactly well-run.

“He knew that things needed change — it was a dollar-in, dollar-out company, and it had its challenges; it took a while to get the company on its feet,” John went on, adding that his father brought some discipline and direction to the venture and put it on more solid ground, with the intention of eventually passing it on to the next generation. Which he did, but not before that generation was fully prepared to lead.

One of the many ITM canopies

One of the many ITM canopies that GIS is making for a growing list of bank clients

“Dad didn’t just hand over the business — he wanted to make sure we could handle it,” said John, noting that he and Dan officially became owners five years ago, but they’ve been managing it for the past 15. “And he did it right — we learned right from the bottom, cleaning toilets, sweeping floors, counting bolts, and getting dirty.”

In recent years, the company has, perhaps without knowing it, steeled itself against downturns — and, yes, even a pandemic — by broadening and diversifying the portfolio of clients and creating a culture grounded in the flexibility and nimbleness noted earlier.

Which brings us back to March, and the arrival of COVID-19.

“We had some really good things moving in the right direction right at the beginning of the year,” John said. “We had a good winter, things were lining up well, and we were really excited about this year.

“But when COVID hit, it hit with a jolt,” he went on. “We weren’t certain what was going to happen or how we were going about things, but if there’s one thing that my brother and I believe in — pre-COVID, during COVID, or post-COVID — it’s that, the more flexible you are as a business, the more successful you can make yourself. And what we found is that, due to our flexibility with working with our supply chain and working with our clients, we were able to manage this crisis effectively.

One of the best examples of this flexibility was the company’s ability to pivot and begin making the plexiglass shields now seen in restaurants, banks, retail outlets, and countless other businesses.

“We reached out to suppliers and started ordering clear acrylic, clear polycarbonate, and started making these custom guards that could be adapted for bank-teller lanes, tabletops, and other uses,” Dan explained, noting that GIS made this adjustment as a way to bring employees back to work after the pandemic hit and sign work ground to a near-halt. “There was a little bit of a learning curve, but overall, it was an almost seamless transition.”

John agreed, noting that the company didn’t have to make any additional investments or find any new suppliers.

“It was just a matter of quickly training employees to make shields instead of signage,” he said, noting that, while GIS is still making these shields for a few hospitals and office buildings, it is increasingly turning its focus back to making signs.

A Bright Future

While many sectors of the economy have slowed because of the pandemic, there are still growth opportunities for companies positioned to take advantage of them, said John, noting that banks, with the emergence of the ITM, clearly represent one of those opportunities.

A new sign the company created for General Dynamics.

A new sign the company created for General Dynamics.

He noted that banks were already moving in this direction, and the pandemic, which closed bank lobbies for months and all but forced customers to use drive-up windows for most all transactions, has only accelerated the process.

“Banks are adding them at their branches, and we’ve also seen an increase in free-standing ITMs that are not at branches,” he explained. “Chase Bank is the first one to do this; they’re looking to close 1,000 locations — downtown locations that don’t have drive-up service — and buy remote sites just outside cities, and put up these free-standing ITMs.

“We’re one of the few companies in the United States building these free-standing ITM canopies,” he went on. “It’s a very interesting development and a great opportunity for us, and we saw it happening pre-COVID; it’s 100% the future.”

As for the future of the sign business … that picture is certainly not as clear, said the brothers Renzi, noting, again, that the pandemic has hit this sector very hard, and there was already a good deal of consolidation before COVID-19 arrived as Baby Boomers retired and sold their ventures to employees or larger players from outside the region.

And since the pandemic, some of the smaller players have closed down, they said, noting they didn’t have the wherewithal to withstand the loss of business and the many other challenges that visited the industry. And many mid-sized companies have struggled with everything from retaining employees to finding the materials they need to complete orders.

GIS, again, is not immune from these challenges, but it certainly seems well-positioned to not only survive but thrive in the post-COVID world.

If you look closely — and you don’t even have to look closely — you can see the signs.

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

Construction Special Coverage

Essential Work

Maple Elementary School, a Fontaine Brothers

The new Maple Elementary School, a Fontaine Brothers project, takes shape in Easthampton.

 

 

Back in March, ‘essential’ was a magic word for employers across Massachusetts. It meant they could continue to work, provide services, and generate revenue during a time when so many sectors were completely shutting down.

But to Laurie Raymaakers, the word means more than that, because construction has always been essential to communities — particularly the infrastructure and civil-engineering projects her Westfield-based company, J.L. Raymaakers & Sons, is known for.

“Through the pandemic season, we’ve continued to get new jobs, and we have been able to keep all our employees working,” she told BusinessWest. “We are considered essential workers because we do a lot of infrastructure work for municipalities, which is very important to every community. We do all kinds of infrastructure — sewers, water, drainage, pump stations, culverts.”

Among the firm’s recent seven-figure projects are a large sewer project in Shrewsbury, a large culvert replacement in Pittsfield, and a drainage pond for Barnes Airport that had to be completed on a tight, 45-day schedule.

The company also created a road for the installation of two wind turbines in Russell and replaced a 100-year-old culvert in a pond at Forest Park in Springfield, a job that involved building a temporary dam, as well as creating new walkways and overlooks in the area. And the company’s workload for the fall and winter, and beyond, looks strong.

“During COVID, a lot of our projects stayed open the entire time because a lot of work we were doing fell under the category deemed essential — a lot of public projects. t was a mixed blessing because it was great to continue working, but also difficult to adapt to the changes day by day.”

“We have enough work to keep going,” Raymaakers said. “But we’ve also worked very hard keeping employees safe. It was very difficult in the beginning, trying to get sanitary supplies for sites, like masks and sanitizer, and follow all the standards of the CDC and prepare all the proper paperwork. We value our employees, and we wanted to keep them safe. We’re very fortunate we work outdoors, with the type of work we do.”

David Fontaine Jr. tells a similar story about his company, Springfield-based Fontaine Brothers, when it comes to being essential.

“We’ve got a lot going on — we’re pretty busy this year and into 2021,” he said. “Prior to COVID coming along, we had a lot of backlog and a lot of work we had underway, so we were in a pretty healthy spot.

“During COVID, a lot of our projects stayed open the entire time because a lot of work we were doing fell under the category deemed essential — a lot of public projects,” he went on. “It was a mixed blessing because it was great to continue working, but also difficult to adapt to the changes day by day.”

Recent and ongoing jobs include building new high schools in Worcester and Middleboro, as well as a new K-8 school in Easthampton; the firm was also recently awarded a job to combine the Deberry and Homer schools in Springfield, with construction to begin next summer.

“The nice part about the public work is it’s funded with reliable state dollars; projects being constructed now were funded a year or two ago, so it’s an ongoing source of work,” Fontaine said. “It looks stable going forward next 12 months at least.”

The biggest concern right now, actually, is that some planned projects will hit a funding stall, which would manifest in a slowdown of projects a year or two from now, he added. But so far, 2020 has been a healthy year, even if uncertainty looms around the corner for many firms.

Reading the Signs

The signs were all there in February, Fontaine said, when COVID-19 was already starting to disrupt some material supply chains.

“We started preparing for it before some of our peers; we were already planning for how we were going to approach it when it came,” he told BusinessWest. “We put into place a pandemic protocol from a safety standpoint for all job sites, and tried to stay ahead of it as much as we could. We wanted to be proactive and make sure the job sites stayed open and safe.”

That involved measures that have become common in many businesses, including personal protective equipment like face coverings and gloves, worn 100% of the time.

J.L. Raymaakers & Sons recently completed an extensive project at Swan Pond

J.L. Raymaakers & Sons recently completed an extensive project at Swan Pond in Forest Park, which involved creating a temporary dam and replacing a century-old culvert.

“We also put additional handwashing stations and sanitizing stations on all job sites,” he explained. “We also require, on every job, a daily check-in process; before anyone enters the job site, they have to self-certify they have not had any symptoms or been in contact with anyone COVID-positive the last 14 days. We’ve also been doing temperature screenings on a couple of job sites.”

Those efforts have paid off, he added. “Knock on wood, but all those measures have been effective in not having many safety concerns or incidents.”

At least one trend in the year of COVID-19 has been a positive for J.L. Raymaakers, whose yard-products division, ROAR, has been extremely busy, adding more than 600 new customers this year and tripling sales.

“That’s partly through marketing and word of mouth, but partly because of COVID,” Raymaakers said. “People have been home, not at work, and they were sprucing up their yards and planting gardens.”

Those two elements of her business — public infrastructure work and yard products — have not only helped Raymaakers and her team weather an unusual year, but thrive during it. But that doesn’t mean she doesn’t recognize acute needs elsewhere.

“People don’t realize you can make a good living, and we’re hearing that everywhere; it’s very difficult to find employees. If the the trades are dying, what’s going to happen then?”

“Because we’ve been so fortunate this year, and so many people and organizations have been struggling, we upped our charitable contributions to help out with food banks as well as the Westfield Boys and Girls Club, making sure we give back to the community and those that are struggling.”

One trend that has not changed this year, even with so many people out of work, Raymaakers said, is a persistent shortage of workers.

“For ourselves as well as other construction companies, as much as we’re busy, it’s very difficult to find employees or crew — equipment operators and laborers — in this industry,” she told BusinessWest.

“People don’t realize you can make a good living, and we’re hearing that everywhere; it’s very difficult to find employees,” she added, noting that many of her firm’s supervisors and project managers started on the ground floor and worked their way up. “If the the trades are dying, what’s going to happen then?”

It’s not a localized phenomenon. According to a workforce survey conducted by Associated General Contractors of America and software vendor Autodesk, 60% of respondents reported having at least one future project postponed or canceled this year, and 33% said projects already underway have been halted. Yet, a shortage of labor remains, with 52% having a hard time filling some or all hourly craft positions and only 3% of firms reducing pay, despite the downturn in business.

COVID-19 is playing some role in that trend. While some companies have laid off workers during the pandemic, 44% of contractors say at least some employees have refused to return, citing unemployment benefits, virus concerns, or family issues, among other reasons.

“Few firms have survived unscathed from the pandemic amid widespread project delays and cancellations,” Ken Simonson, chief economist of Associated General Contractors of America, told the Engineering News-Record. “Ironically, even as the pandemic undermines demand for construction services, it is reinforcing conditions that have historically made it hard for many firms to find qualified craft workers to hire.”

One positive from all this has been an accelerated adoption of technology. According to the workforce survey, about 40% of responding contractors said they have adopted new hardware or software to alleviate labor shortages.

“As bad as this situation is, it’s also pushing the industry forward into a better place,” William Sankey, CEO of data-analytics solutions provider Northspyre, said in Construction Dive, an online industry newsletter. “Maybe, where it would have taken seven to 10 years to catch up to where the finance industry is in leveraging data, I think that transition will now be underway in the next two to three years.”

Down the Road

What happens over the next two to three years is really the key for all construction firms, which expect COVID-related impacts to continue to be felt down the road.

For now, though, Fontaine is gratified that his company’s workload is healthy, with public projects complemented by a fair amount of private work, including jobs for MGM and several prepatory schools, including Northfield Mount Hermon School, Deerfield Academy, and Wilbraham & Monson Academy.

“We’re hoping those types of schools will have OK years fundraising for those types of projects,” he said, adding that private-sector clients can often move from funding to the construction phase quicker than municipalities, especially when they realize they can take advantage of recession-driven lower prices.

It’s just another way this unprecedented year has cut both ways for construction firms. The big question is what the coming years will bring for a sector that’s essential in more ways than one.

Joseph Bednar can be reached at [email protected]

Coronavirus Features Special Coverage

Plane Speaking

Travelers at Bradley

Travelers at Bradley (and there are fewer of them) will find a number of new protocols, from mandatory face coverings to more frequent cleaning and sanitizing.

Bradley International Airport has a contract with a medical laboratory willing to conduct COVID-19 testing for arriving passengers.

Kevin Dillon, executive director of the Connecticut Airport Authority (CAA), which manages the airport in Windsor Locks, Conn., thinks that would be an ideal way for healthy travelers to avoid a mandatory 14-day quarantine instituted by Gov. Ned Lamont in July.

But state leaders turned that option down.

“We have a lab that’s willing to start testing here, yet we can’t convince the Department of Public Health to allow that to occur. It makes no sense,” Dillon said. “Because what’s impacting us now is the travel advisory that’s been put in place here in Connecticut.”

According to the policy, both tourists visiting from other states and Connecticut residents returning from vacations in COVID-infested areas are required to fill out a travel advisory form and indicate where they will self-quarantine. Failure to do so incurs a $1,000 fine.

“Unfortunately, the airlines are reacting to the travel advisory by pulling flights out of the airport,” Dillon explained. “As you can imagine, it’s very, very difficult for someone to take a week vacation and then, when they come back, have to take a two-week quarantine. The same goes for business travel — people aren’t going away for two days when they have to quarantine for 14. That’s had a pretty chilling effect on our level of recovery.”

It’s a recovery — if one can call it that — from the most dramatic loss of business airports across the country have ever experienced, the post-9/11 period included. In April, passenger volume at Bradley was down 98% compared to the same period last year. The airport has recovered some of its volume, but a typical day is still some 70% to 75% below 2019 numbers. And the state of Connecticut is doing the airport no favors with one of the most rigid travelers’ advisories in the nation.

Kevin Dillon

Kevin Dillon

“Airports are competing for some very limited airline assets, aircraft and flights, so we want to present a market that’s viable. This travel advisory really starts to skew how some carriers look at Connecticut and Bradley Airport and this region.”

“I’m not questioning the medical necessity of a travel advisory — I’m not qualified to question that, and I take folks at their word that it’s is a necessary thing,” Dillon told BusinessWest. “What we have asked for here is a testing option. If you get a negative COVID test, you should be able to avoid a 14-day quarantine period. Massachusetts is doing that.”

He has other questions — including why it’s OK to cross the border for a funeral, but not a business meeting — and they all come, he said, from a place of common sense. “We’re not questioning the travel advisory, but I do think testing here at Bradley would make all the sense in the world.”

If the impact of discouraging interstate travel was a short-term thing, it would be less frustrating, but Dillon is looking far beyond 2020, when airlines will emerge from the pandemic as much smaller companies, with fewer planes to spread around the nation’s airports, and some tough decisions to make about where to put them.

“They’re really having a struggle,” he said, with some airlines saying they don’t expect to return to normal operations until 2023 or 2024. “There are going to be winners and losers coming out of this.”

This is true, he said, not only of airlines, but of airports.

“Airports are competing for some very limited airline assets, aircraft and flights, so we want to present a market that’s viable,” Dillon explained. “This travel advisory really starts to skew how some carriers look at Connecticut and Bradley Airport and this region. It’s a concern of ours not only for today but as we look to the future — what damage we’re doing to our relationships to airlines as well as their view of this market.”

Physical distancing

Physical distancing is easier when terminals are less crowded, as they are now.

For this issue’s focus on transportation, BusinessWest spoke with Dillon about how Bradley is navigating an unprecedented business challenge, and why it’s important to keep investing in the future, because the future is where this story really gets interesting.

Shifting on the Fly

Even before COVID-19 was a thing, Dillon often spoke about how Bradley was constantly competing on two levels: with Logan and the New York airports for passengers, and with every airport in the country for those precious aircraft assets. On thar front, Connecticut’s mandatory quarantine isn’t helping.

“Airlines have to be in locations like Boston and New York simply because of the population and business volume. But airlines have alternatives in terms of not having to serve Bradley and still serving a good portion of this market area,” he explained. “I don’t think it would serve the area really well without us, but an airline trying to skinny down as a result of cost-cutting measures could very well look at it that way.”

The more pressing issue in 2020 has been plummeting demand, of course. “If we don’t have passengers coming through the airport, airlines cut back, we don’t get airline fees, and no one’s here utilizing concessions, parking, renting cars, all the businesses here. When your business is off 75% to 80%, you have a corresponding drop in revenue. It’s a difficult balancing act.”

Dillon said Bradley was fortunate to receive some financial assistance from the CARES Act, which allocated $10 billion to airports across the country. Based on the allocation formula, Bradley received $28 million, which sounds like a lot of money, he went on, but to put it in perspective, that covers about three months of operating expenses and debt service. And the pandemic-related travel slowdown is now well into its sixth month.

“We are fortunate that, as an airport authority, we did create what I consider some healthy reserves, and we will rely on those reserves to some extent, but it wouldn’t be prudent to exhaust our reserves,” he said, noting that they impact bond ratings, among other things.

Bradley did institute a hiring freeze, not replacing most employees who chose to retire this year, and has cut department budgets by 10% to 20%. The CAA is also looking at further measures, including a voluntary severance program.

“It is a goal of ours to try to prevent involuntary severances,” Dillon said. “We don’t want to get to a place where we’re talking about layoffs. For now, that’s off the table. We tried to make a commitment to the employee base — first and foremost, to protect their health, and second, to protect their paycheck. As you can imagine, it’s a challenge.”

About $20 million in capital projects are on hold as well, but some are moving on, including an airport-wide restroom-renovation project that should be complete by October, and features a largely touchless experience with sinks, soap dispensers, hand dryers, and more. These features were planned well in advance of the pandemic, but Dillon said travelers will appreciate them more now.

“People want a safe, healthy, clean environment, and we try to deliver that the best we can,” he noted. “Folks think differently about hygiene in public places now; they have different expectations.”

Other protocols in place at Bradley include the expected: mandatory face coverings, more frequent cleaning and sanitization efforts at high-touchpoint areas, plenty of hand-sanitizer stations, signage detailing physical distancing rules, and plexiglass shields in high-passenger-interaction areas.

Some airlines have committed to limited capacity on planes as well, Dillon said, citing Southwest and Delta as two examples. And the airport is developing touchless kiosks where travelers don’t have to interact with an agent or touch the screen to activate the ticketing process.

Bradley’s restrooms

A major renovation of Bradley’s restrooms, including many touchless features to discourage the spread of germs, began well before the pandemic.

“The key for us is to keep differentiating ourselves from our larger competitors,” he told BusinessWest. “We want people to understand that Bradley is going above and beyond in terms of sanitizing and cleaning the facilities. And Bradley might represent a better option because it’s less congested. We’re going to keep highlighting to the traveling public why Bradley is a better alternative.”

View from the Ground

Again, however, all these efforts are blunted by the fact that considerably fewer people are traveling, and Connecticut is making it difficult to do so.

Airlines are struggling too, Dillon said, sending 135-passenger planes into the sky with only 25. And, like airports, they’re all having internal discussions about the future. Bradley’s five-year contract with carriers expired in June, and with no airlines in a position to sign another five-year deal, they opted for one-year extensions.

But even had longer-term contracts been in place, he explained, “I think a lot of people don’t understand how an airline agreement works. It doesn’t necessarily guarantee you full revenue coming in, because airlines pay revenue in large measure based on landing fees. Airlines can have a presence and pay rent for space, but they’re not required to operate a certain number of flights. If you have carriers cut operations in half, the landing fees we get are then cut in half from that carrier.”

As a difficult, uncertain year continues to unspool, there are a few bright spots, especially progress on a $210 million ground transportation center — expected to be fully operational in late 2021 — that will house car-rental services, expand public parking, and incorporate public-transit connections.

“All that money had been bonded prior to the pandemic, so we’re committed to the project,” Dillon said. “It will really transform the look of the airport and our operations. People who haven’t been to the airport recently will be surprised by the magnitude of the project and how it’s transforming the space out there.”

In addition, cargo business at Bradley has remained consistently strong. “I believe one factor is that people are staying home and doing a lot of online ordering, so we’re seeing small-package delivery — UPS, Fedex, and Amazon — all increase at the airport,” he noted. “Unfortunately, the revenue profile of cargo is much different than passenger traffic, as the bulk of the revenue at any airport comes from the passenger side of the house. But I appreciate that cargo is doing well right now.”

After all, in a year of startling setbacks, any good news is welcome. But what airports need now is clarity — and for people to get back on planes.

“It’s going to be a challenge,” he said. “I’m convinced that, by working smart and having employees work smart, we’ll be able to get through this. But it will be a balancing act for a while.”

Joseph Bednar can be reached at [email protected]

Banking and Financial Services Coronavirus Special Coverage

Uncharted Waters

Michael Tucker

Michael Tucker, president of Greenfield Cooperative Bank.

It’s safe to say 2020 has been an unpredictable year, testing the ability of all businesses to be nimble. Matt Sosik thinks banks are passing that test.

“Community banks may seem like they’re a staid industry, but we’re actually very accustomed to change, and sometimes a fast pace to that change,” said Sosik, president of bankESB. “So we’re used to it. It’s not always visible from the outside, but culturally, we were very well-positioned to deal with the pandemic.

“The unique thing was that it just seemed to happen so fast. It was zero to 60, and you can’t always move at that pace,” he added, noting that bankESB is part of a family of three different banks with almost 500 employees. “But we pivoted as fast as we could.”

Part of that was recognizing that many customers were suddenly in turbid financial waters, and needed help. So, early in the pandemic, all banks were doing what they could to help them, whether that meant deferring mortgage loans for a few months or guiding businesses through the hastily assembled Paycheck Protection Program, or PPP.

“We had a customer-centric focus, which meant helping people navigate payment-related financial issues — at least the financial issues in their lives that could impact their ability to pay us. We did modifications for a lot of folks; we could foresee this was going to be a problematic situation for them. We got out front of it early and tried to alleviate that one piece of stress at a time when so many aspects of life were stressful. We did millions-of-dollars-worth of modifications for customers in the Pioneer Valley.”

Business customers, especially ones forced by a state mandate to shut their doors, were facing similarly dire issues, Sosik said. “We were also doing PPP by the truckload. It was uniquely challenging for us because it all happened at once.”

Such efforts have impacted banks’ bottom line, said Michael Tucker, president of Greenfield Cooperative Bank (GCB), noting that about 15% of mortgage and commercial loan customers took advantage of deferral programs, resulting in an impact of $900,000 from an accounting perspective.

“Everyone else seemed to be in good shape — but that doesn’t mean it’s going to stay that way,” he told BusinessWest. “I don’t see this totally ending until there’s some sort of treatment or vaccine that’s really effective. That being said, things are slowly reopening, and Massachusetts has done a pretty good job keeping infections down.”

And community banks were an important part of that, he said, noting that those loan deferrals, plus costs related to the shutdown and investments in safety protocols in order to reopen, have contributed to GCB being about $1.5 million behind where it would normally be.

“Community banks may seem like they’re a staid industry, but we’re actually very accustomed to change, and sometimes a fast pace to that change. So we’re used to it.”

“It’s going to be a profitable year, but a lot leaner. It’s going to be a challenge,” Tucker went on. “What worries me is what hasn’t risen to the top. We did the payment holiday, but now that the unemployment supplement is gone, and companies rightsize — a lot of them were paying people but couldn’t keep it up forever — I think, until we have a vaccine, we’re looking at a very difficult 2020 and 2021. We’ll be solid; we’ve put a lot of reserves aside, but it’s going to be a challenge.”

Loan Stars

There are some positive signs in the economy, said Jeff Sullivan, president of New Valley Bank, which launched in Springfield last year. He participates in a group of bank CEOs, and on their last group call a couple weeks ago, most said they were pleasantly surprised that, at least on the commercial-loan side, customers who had deferred loan payments had largely returned to their normal payment schedule.

He noted that bank stocks have been “beat up,” as the analyst community didn’t like the idea of deferring principal and interest. “But the overall, totally unscientific trend I’ve seen is that people are pleasantly surprised with how businesses are coming back.

“From our standpoint, we see a lot of growth; businesses are making plans again,” he went on, conceding that New Valley doesn’t yet have a huge portfolio to manage.

Meanwhile, the housing market and stock market are doing better than anyone expected three months ago, he noted, which contributes to an overall mix message when GDP was down 30% in the second quarter and unemployment rose to 16%. “These are troubling numbers, and from a community-bank perspective, we hope it doesn’t turn into a haves-and-have-nots recovery, where the rich get richer and more people get left behind.”

Tucker said demand for loan deferrals has been way down, and banks are now pivoting to help businesses with the forgiveness-application phase of the PPP.

“We did about $18 million worth of PPP, which for us was a lot because most of our loans were under $250,000,” he said, noting that GSB handled about 280 such loans. “It was about a year’s worth of work in a month. Like a lot of banks, our staff was working nights and weekends.”

Sosik added that the waters surrounding the PPP forgiveness phase are still a but murkey and could use some clarity from Congress so the forgiveness path can be clearer. “If people are unclear about forgiveness, they don’t want to spend the money, so it doesn’t get out into the economy.”

At the same time, he added, banks are also being cautious when it comes to growth plans.

“It’s a time to be careful, but at the same time it’s been a very successful year,” he told BusinessWest. “We’ve grown a lot this year, but we’re obviously looking forward, expecting continued economic challenges, and our job is to be here for many years. There are times to push hard and run fast, and times to slow that down and be cautious.”

Still, banking leaders are pleased to have made the investments they did in online and remote banking models, Tucker noted, while holding up his smartphone. “Our fastest-growing branch is this. That’s a reality.”

“Banks caused the 2008 recession. Banks were weakened and in a penalty box and reviled by the mainstream for several years afterward. The big difference now is, this recession was not caused by banks.”

But while the number of GCB customers using remote banking is 25% higher than before COVID-19, branches still serve a critical purpose, he added. “We’ve seen a lot of people realize we are invaluable to them. When they had problems with their mortgage, they can deal with one person and not get shuffled through a lot of bureaucracy. That’s a plus.”

While branches are still necessary, he went on, they’re different than they used to be; the recently opened South Hadley branch is 1,800 square feet, less than half the space the bank used to set aside for new branches. But he doesn’t foresee any closures, aside from two Amherst branches, about a mile apart, that recently consolidated into one.

“Some banks are using this time as a trigger to say, ‘OK, we’re going to close these branches,’” Tucker added. “We’ve chosen not to do that because there’s enough disruption for customers as it is.”

Sosik noted that bankESB has invested a lot of money in the remote infrastructure and platform. “The technology works seamlessly, and the adoption was good. We were looking for a catalyst we could use to push it and have customers really start enjoying the technological advances. We didn’t expect it to come from a pandemic; we didn’t want it to come from a pandemic. But the pandemic absolutely pushed people to use it.”

That said, “we totally believe in the branch part of the overall delivery system, and we’re still investing in branches,” including one recently opened in Amherst. “But they’re much different than the ones we built a decade ago, or even five years ago. There’s still a need for a branch; customers still want that. Even if they don’t need to be there, they still like that someone they know and trust can work with them when they need it.”

Here for the Long Haul

Whatever the model, the presidents BusinessWest spoke with all believe in the work community banks have done and continue to do during a very difficult year for so many.

“We believe in it,” Sosik said. “Everyone who works for a community bank does it because we love that part of it. If you look at any successful New England town, you’re going to find a locally managed, if not locally owned, community-type bank at its economic center”

While banks still grapple with the impact of not only loan deferrals but ultra-low interest rates, they’re still in strong shape, he added.

Sullivan agreed. “Banks caused the 2008 recession. Banks were weakened and in a penalty box and reviled by the mainstream for several years afterward. The big difference now is, this recession was not caused by banks. Banks are healthy and have lots of capital. And hopefully we can turn the page soon and get back to normal lending.”

Tucker doesn’t know what shape the recovery will take — a U, a V, or the one he feels is most likely, resembling the Nike ‘swoosh’ logo, with a long, gradual ascent to normalcy.

“But we’ll do fine, and we are doing fine,” he said. “There’s just a lot of pressure on the margin with rates as low as they are and all the unknown with COVID.

“I’m very optimistic, though,” he added. “Businesses are doing OK. Yeah, a lot of them are struggling, but we see a lot of small businesses trying their damnedest. And we’re trying to support those businesses. We’re here, and we’re going to be here.”

Joseph Bednar can be reached at [email protected]

Community Spotlight Special Coverage

Community Spotlight

Ryan McNutt

Ryan McNutt says a burgeoning cannabis sector is just one of many positive developments in Palmer.

If there’s one thing capitalism doesn’t like, Ryan McNutt says, it’s uncertainty. And COVID-19 has certainly injected plenty of that into the regional and national economic picture.

But unlike more densely populated areas like Boston, where the death toll — and accompanying anxiety — are higher, leading to a slower return to acitity, Palmer has seen only seven coronavirus-related deaths. Even now, only nine people are under some sort of quarantine order, following a long stretch of no cases at all.

How much Palmer’s low case count has affected business activity is hard to tell, said McNutt, who became town manager last year. But there’s reason for cautious optimism.

“I’m encouraged that our busiest department right now is our Building Department; in fact, I’m going to add another building inspector,” he told BusinessWest. “And some other Western Mass. communities are seeing that as well.”

Local projects run the gamut from a bar on Main Street being converted to a pizza restaurant to Adaptas Solutions adding a building to its complex in the Palmer Industrial Park.

“It’s a growing business — even in this pandemic, people are still adding jobs, adding capacity, adding new product lines,” said McNutt, noting that Sanderson MacLeod, which specializes in manufacturing twisted wire brushes, has grown recently by shifting to new product lines, some of them medical, during the pandemic. “Capitalism is creative destruction. People are going to enter new markets, or enter existing markets where others couldn’t fill those markets, and Palmer will benefit from that.”

The cannabis sector certainly shows no signs of slowdown, with four businesses — Altitude Organic and Heka Health on the retail side and and MINT Cultivation Facilities and the WingWell Group on the cultivation side — getting ready to open in the coming months.

“I’m encouraged that our busiest department right now is our Building Department; in fact, I’m going to add another building inspector.”

“This will be an amazing amount of unrestricted local revenue,” McNutt said, though he was quick to add that most neighboring states still haven’t legalized cannabis. “Once those states or the federal government legalize, there will be diminishing returns. We’re seeing hundreds of thousands of dollars coming in from other states.”

That said, he expects the industry to be a net positive for Palmer’s tax base for a long time to come, even if it’s hard to predict the exact impact. “There’s obviously a floor of cannabis users, but what is the ceiling?”

It’s a question he can apply to many types of economic development, including a long-talked-about rail line that could eventually be a game changer for this community of just over 13,000 residents.

Focused Approach

When McNutt, the former city manager of Claremont, N.H., took over in Palmer last July, economic development was a key focus from the start.

“Economic development is important, making sure we grow the tax base and make it sustainable for the people who live here but also create opportunities to attract new people coming in,” he said. “We can do that to some degree ourselves, and then there are macro things happening, like the east-west rail line. Some days I’m more confident that will come in, some other days I’m less confident. I try to stay on the optimistic side of it.”

Palmer at a Glance

Year Incorporated: 1775
Population: 13,050
Area: 32 square miles
County: Hampden
Tax Rate, residential and commercial: Palmer, $22.80; Three Rivers, $23.42; Bondsville, $23.89; Thorndike, $24.16
Median Household Income: $41,443
Median Family Income: $49,358
Type of government: Town Manager; Town Council
Largest Employers: Baystate Wing Hospital; Sanderson MacLeod Inc., Camp Ramah of New England; Big Y World Class Market
* Latest information available

That said, “if our folks at the federal level are really looking at this country, starting to talk more and more about having a national infrastructure package, then I think the east-west rail line is more promising, because it will take federal money; it will take being a component of a larger national infrastructure package to make it doable. But that east-west rail line would be so transformative for the Commonwealth of Massachusetts.”

In recent years, the Palmer Town Council established a citizens’ advisory committee and contracted with the UMass Center for Economic Development to study the merits of an east-west passenger rail stop in Palmer. The town’s position, roughly central to Springfield and Worcester, and also at the center of a market that extends north to UMass Amherst and the Five Colleges and south to the University of Connecticut, makes it a point of connection in many directions that would benefit from expanded rail service.

In addition, McNutt noted, Palmer has a workforce of close to 8,000 people, and 85% of them work outside of Palmer, mostly in Worcester but more than 100 in Pittsfield. A rail line would ease the commute for many, while individuals who want to work in the Boston area, where housing prices can be exorbitant, could instead choose to live in towns along the rail line, like Palmer.

“There are a lot of good opportunities that make Palmer an attractive community, as long as we market ourselves correctly,” he told BusinessWest. “We’re making sure we’re doing everything we can so when a national infrastructure package gets introduced, we will be shovel-ready.

Speaking of infrastructure, Palmer boasts nine bridges that span four rivers, all built around 80 years ago with a life expectancy of about 50 years, he said. The cost to repair them is about $3 million per bridge, on average, and with the entire municipal budget, including schools, around $40 million, “it’s not like we have the internal capacity to just fix those bridges.”

The town submitted a $7.5 million grant application to the federal BUILD program last year to repair a couple of those bridges, competing with $10 billion worth of applications — across all 50 states — for about $900 million in funding. Despite those odds, Palmer made it to the final round of consideration before being dropped, and McNutt said the region’s federal lawmakers encouraged him to reapply this year. He’s cautiously optimistic the news will be better this time around.

“I think both Democrats and Republicans agree we’ve let huge swaths of this country fall apart since the end of World War II. Bridges, ports, airports … we’ve got to get on top of this. Everyone understands the deficiency across the country is bipartisan. The amount of jobs that could will be created would keep people working for the 20 years fixing the stuff we’ve let go for 70 years. And borrowing money has never been cheaper.”

Bang for the Buck

McNutt said he’s always thinking in terms of economic development, and its importance in communities with tax-rate increases constrained by Proposition 2½.

“I’m conservative when it comes to taxpayer resources,” he said. “I grew up in Massachusetts, and I know the strain Proposition 2½ places upon communities and municipalities, considering the rising fixed expenditures and costs we face, especially on the school side. And at the same time, I really believe that taxpayers pay a lot of money. I’m very keen on making sure people get value for that taxpayer dollar, so we’re always looking for grants and efficiencies in doing business, to be able to control those costs.”

For that reason, he went on, it’s important for towns of Palmer’s size and demographics to attract an influx of younger residents, and expanded rail could help boost that effort.

“Everybody who’s aging and on a fixed income, they really have a limited runway in what the property taxes can get to,” he noted. “That’s something that’s always my first focus — what is the tax base, what is the tax rate, and what is the economic capacity to pay it? How quickly do we need to find new revenue to support municipal operations without having everything fall on the backs of the retiree who’s lived in Palmer their whole life, and not necessarily getting new revenue themselves?”

Fortunately, even during a pandemic, growth is possible — and, in many cases, happening — and the promise of east-west rail service only boosts McNutt’s sense of what’s possible. While his confidence on that front may waver, depending on the day, his belief in Palmer’s potential — and its ability to weather the current storm — certainly does not.

Joseph Bednar can be reached at [email protected]

Features Special Coverage

On the Right Track

Jeremy Levine

Jeremy Levine says Pioneer Valley Railroad and Railroad Distribution Services have a unique business model that has led to decades of success and steady growth.

When it comes to moving freight, Jeremy Levine says, many business owners believe it comes down to a choice between rail — if it’s available — or trucks.

But in many cases, he believes, the best answer might be rail and trucks.

And this is the answer that has enabled Westfield-based sister businesses Pioneer Valley Railroad (PVRR) and its wholly owned subsidiary Railroad Distribution Services (RDS) — both Pinsly Railroad companies — to thrive for the past 35 years and remain on a steady growth trajectory.

“Railroads and trucking … they have their lobbyists in D.C. on opposite sides of the aisle trying to argue against one another,” said Levine, who is awaiting new business cards that will identify him as the company’s business-development coordinator. “But the truth is, for a short-line railroad like us, we use trucking all the time — we’re sending out hundreds of trucks a year to do the last-mile transit for our customers, either here in Westfield or all across the Northeast.”

As a short-line railroad, PVRR, as it’s known to many in this area, moves on 17 miles of operable track running north from Westfield, said Levine, the fourth-generation administrator of the company started by his great-grandfather, Samuel Pinsly. There is a branch running roughly four miles in Westfield and another branch running 13 miles into Holyoke.

The company interchanges with two class-1 railroads — Norfolk Southern and CSX — and takes freight that last mile, as Levine put it, referring to the last leg of a journey that might begin several states away or even on the other end of the country.

“The number you’ll hear is that four trucks equals one rail car. So if you looking to ship a distance or something that’s very heavy, that’s where we provide economies of scale.”

“If you want to get lumber from Louisiana, a large class-1 railroad such as CSX will bring that up, interchange with us at our yard in Westfield, and we’ll take it the last mile or miles to our customers, if they’re located directly on our line,” he explained, adding that, for customers not on the line — those without a rail siding — RDS will take it the last leg by truck via two warehouses it operates in Westfield.

And in some cases, that last leg might be dozens or even hundreds of miles, he noted, adding that rail is a less expensive, more effective way to move material, and RDS enables customers to take advantage of it, at least for part of the journey.

“The number you’ll hear is that four trucks equals one rail car’s worth of capacity,” he explained. “So if you looking to ship a distance or something that’s very heavy, that’s where we provide economies of scale.”

This has been a successful business model since 1982, and the company continues to look for growth opportunities in this region, he noted, adding that such growth can come organically, from more existing companies using this unique model, or from new companies moving into the region to take advantage of its many amenities — including infrastructure. And Pinsley Railroad owns several tracts of land along its tracks that are suitable for development, he noted.

For this issue and its focus on transportation, BusinessWest takes an in-depth look at PVRR and RDS, and how those letters can add up to growth potential — for the company and the region itself.

Train of Thought

Levine told BusinessWest that, while he didn’t work at what he called the “family business” in his youth, he was around it at times, well aware of it, and always intrigued by it.

“When my grandmother was running the business, that’s when they moved the headquarters from Boston to Westfield,” said Levine, who grew up in nearby Granby. “You grow up going to the rail yard, and you’re around these people; you’re definitely going to be inclined to the business.”

But he didn’t take a direct route, as they might say in this industry, to PVRR’s headquarters on Lockhouse Road. Indeed, after graduating from George Washington University in 2015, he stayed in D.C. and worked on Capitol Hill, specifically on transportation policy. He later moved to the private sector and worked at a firm advocating for railroads.

Eventually, he decided he wanted to be a part of the family’s business and relocated to Western Mass. “It’s been quite a ride,” he said while borrowing more language from the industry, noting that he started at PVRR and RDS roughly a year ago.

He came to a company that had a small, steady, and diverse group of rail customers, some that receive thousands of rail cars of material a year and others merely a handful of cars, and more than three dozen RDS customers.

He said his new job description is essentially to generate new business, and he believes there is enormous potential to do just that — again, because of the unique business model these companies have developed and the benefits that rail (or a combination of rail and trucks known as ‘transloading’) brings to potential customers.

As Levine talked about the sister companies and how they operate together, one could hear the drone of forklifts operating in the warehouse outside his office, which led to an explanation of how it all works.

“We have some rail cars here this morning,” he explained. “They got dropped off by CSX late last night; early morning, or 3 a.m. crew [at PVRR] dropped them off here. The crews have been unloading them, staging them, and placing them outbound on trucks to head off to our various customers.”

There are other operations like this, or somewhat like this, in the Northeast, he explained, but what sets this operation apart, beyond the interchange with the two class-1 railroads, is the fact that the company owns both its railroad and distribution services.

“There are companies like our Railroad Distribution Services that are directly on CSX’s line,” he noted. “But the difference there is they don’t control the trains; I can pick up the phone and call the train operator and ask him when he’s going to be here with my rail cars, and with that comes a lot of security that your stuff is not going to backlogged or jammed up and that your deliveries are going to come on time.”

It is this security — and these benefits — that Levine is selling to potential customers. And as he goes about that task, he has the Pinsly team, if you will, focused solely on the Westfield operation and its future. Indeed, the company, which operated short-line railroads in Florida and Arkansas, has divested itself of those operations, with PVRR and RDS being the only holdings in the portfolio.

“What that has allowed us to do is reinvest and recalibrate,” he explained. “We had a very large team throughout the years and a lot of focus on Florida, where we had 250 miles of track; we can now take that talent and focus on our operations here.

“My go-to line is that ‘even you don’t have rail siding, that doesn’t mean you can’t benefit from railroading,’” he continued, adding that he can back up those words with numbers, and he intends to use them to build the company’s portfolio of customers.

PVRR owns a 1930s-era passenger rail car that it calls the ‘dinner train.’ As that name suggests, it’s used for fundraising events, a customer-appreciation gathering, and even as a means to transport Santa Claus to Holyoke Heritage State Park for annual festivities there.

It hasn’t been out of the yard much in the era of COVID-19, but U.S. Rep. Richard Neal recently used it as a backdrop for an event, said Levine, adding that the dinner train has become a highly visible part of this company for decades now.

But the bottom line — in virtually every respect — is that PVRR and RDS are about getting freight, not people, from one place to another.

It’s a moving story, and one that could well add a number of new chapters in the years to come as the company tries to get customers on the right track when it comes to freight — literally and figuratively.

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

Daily News Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 23: Aug. 31, 2020

George Interviews Paul Kozub, founder of V-One Vodka 

George interviews Paul Kozub, founder of V-One Vodka and one of the five finalists of the BusinessWest’s 40 Under Forty Alumni Achievement Award.  Launched in 2015, and known then as the Continued Excellence honor, BusinessWest’s Alumni Achievement Award recognizes a previous 40 Under Forty honoree who has continued to build on his or resume as a rising star in this region and leader both in business and within the community. This is the first installment of Alumni Achievement Award podcast installments. Hea what Paul has been up to since his 40 Under Forty honor!

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Guide to Senior Planning Special Coverage Special Publications

Without a doubt, 2020 has been an unprecendented year. The COVID-19 pandemic has thrown the economy, family life, and, well, just about everything else into disarray.

Yet, one aspect of American life has definitely not changed — and that’s the need to prepare for one’s senior years.

As the Baby Boom generation continues to march into their retirement years — at the rate of 10,000 per day — Americans are living longer than ever. In fact, according to the U.S. Census Bureau, by the year 2030, more than 20% of U.S. residents will have passed their 65th birthdays.

But what that life will entail, post-65, can wildly vary depending on lifestyle preferences, health status, finances, and more. That’s why preparation is so important — the sooner, the better. And that’s what this special section of BusinessWest is all about.

For the second straight year, we take a hard look at myriad questions: what levels of care are available, and what do they include? What are some strategies for approaching mom or dad with concerns they might not be able to live alone anymore? How can families pay for all this? What’s an estate plan, and what documents are most important?

As noted, 2020 is already a year fraught with anxiety, and no one wants to add more. But the truth is, even if you don’t expect to be thinking about long-term care for yourself or a loved one, an unexpected accident, illness, or injury can change one’s health needs, sometimes suddenly — or the need might emerge gradually, due to declining health.

It’s a lot to think about, and no single guide can answer all those questions. But hopefully, the following pages will help you approach those decisions with a little more understanding and a little less worry.

According to the U.S. Census Bureau, by the year 2030, more than 20% of U.S. residents will have passed their 65th birthdays.

Coronavirus Manufacturing Special Coverage

Making Do

Kristin Carlson

Kristin Carlson says the pandemic has actually helped business at Peerless Precision, especially when it comes to making parts for defense and law-enforcement-related products.

Mark Borsari says he hasn’t been on a plane since a vacation in early March.

By his reckoning, that’s by far the longest stretch he can remember when he hasn’t been flying somewhere, especially in his role as president of Palmer-based Sanderson MacLeod, a maker of fine wire brushes for everything from makeup kits to gun cleaning.

The six months on the ground has been a time of reflection — and even humor.

“I’m sure my wife’s probably thinking I should be on a plane more,” said Borsari with a laugh, adding that he’s not at all sure when he actually will.

But being effectively grounded from air travel is just one of the many ways COVID-19 has shaken things up for manufacturers, and, in the larger scheme of things, perhaps one of the least consequential given the way Zoom has become the preferred method for communicating with clients and employees alike.

Indeed, the pandemic has prompted everything from weeks-long shutdowns to scrambling for needed parts; from strategies for keeping employees safe to the need to manufacture different products — often PPE — to keep workers busy because demand for the products that were being produced has slowed or stopped.

Much has hinged on the word ‘essential’ — a status bestowed on many manufacturers in the 413, an area with a large number of shops making parts for aerospace, defense, or the broad healthcare sector.

Sanderson MacLeod makes products for all those fields, said Borsari, noting that, after a short but still tension-filled time of uncertainty regarding the company’s status, it was declared essential. The same with Westfield-based Peerless Precision, a company that makes, among other things, products used in the cryogenic cooling systems for thermal imaging, night vision, and infrared cameras — items that are actually in greater demand because of all the tension in the world at the moment.

Mark Borsari

Mark Borsari says being deemed ‘essential’ certainly helps, but there is too much uncertainty with this pandemic for any company to feel secure about the future.

“Any time there’s any trouble going on in the world and more money is being put into the defense budget, we benefit from that,” said Kristin Carlson, the company’s president. “We’re getting new engine parts, new fuel-injection parts … things we’ve never made before. Any time there’s unrest in our country or anywhere in the world, the Defense Department spends more money.”

But not all area manufacturers have been so fortunate. Indeed, while golf balls are important to many, they are not ‘essential’ in the eyes of the state’s governor, so the Callaway plant in Chicopee was shut down as it was heading into its busiest time of the year — the start of the golf season in the Northeast and other colder climes. And shutting down a plant that size, which was running three shifts six days a week, is a complicated undertaking, said Vince Simonds, the company’s director of Global Golf Ball Operations.

“It’s difficult to shut it down so abruptly and then wind it back up again,” he said, noting that the massive plant was shut down from March 25 until May 18, when the first phase of the state’s reopening plan went into effect. “But overall, we’ve done very well.”

Fortunately, the company has been helped by something that could not have been foreseen in those dark days of March — a surge in popularity in the game of golf resulting from the fact that it is one of the few sports people can play while also socially distancing themselves from others.

“It’s difficult to shut it down so abruptly and then wind it back up again. But overall, we’ve done very well.”

This surge now has the company running three shifts seven days a week, said Simonds, adding that Callaway is now struggling to meet global demand, especially for its lower-priced, entry-level products (more on that later).

But even for those companies that were not shut down, have not seen shrinking demand for the products they make, or been helped by the rush to take up golf, the pandemic has led to a time of challenge, uncertainty, and questions about what will, and won’t, come next. And this is a difficult climate to operate in, said Borsari, who tried to put things in perspective for BusinessWest.

“The biggest challenge is that there is no playbook for what we’re dealing with,” he explained. “This thing has come through and almost indiscriminately picked out specific companies and industries and devastated them and left others somewhat unscathed. It depends on who their market is, where they are on the supply chain, who their vendors are, who their customers are … there are so many variables.

“Normally, when you run into these challenges in business, you can at least do some research or talk to some people who have been through it before to get a gauge for what was successful,” he went on. “With this, there is none of that.”

Parts of the Whole

Flashing back to early March, Carlson noted that, at least in one respect, the company was ready for what was coming.

“We had just put in a very large order for toilet paper and other supplies from Staples,” she recalled, adding that, soon thereafter, such essentials were certainly hard to come by. “I was telling everyone that I had something like 180 single rolls of toilet paper … so if you guys can’t find any, we’ll sell it to you for cost.”

But beyond that, there was little way to anticipate, let alone prepare for, the pandemic and the many ways it was going to change the landscape for all businesses, and especially manufacturers. And for many, there was uncertainty about whether the doors would remain open as the state began to shut down businesses to help slow the spread of the virus.

Fortunately, for many, this uncertainty was short-lived.

Vince Simonds

Vince Simonds says a pandemic-related surge in the game of golf has helped take the sting out of being shut down for two months this past spring, Callaway’s busiest time for making golf balls.

“We’re the largest medical and surgical manufacturer in the country, and we also do a lot of work for government agencies and the military with gun-cleaning products,” said Borsari, adding that Sanderson MacLeod was able to get the green light from the state and the town of Palmer to remain open for business.

“Getting deemed essential was important for us,” he recalled. “One of the concerns for the people was whether they’d have a job; they were seeing all these companies shut down around them, and that was the biggest concern they had from the beginning — whether we would be allowed to stay open.”

The company has been fortunate in other ways as well, he said, noting it had undertaken catastrophic planning and redundant sourcing before the pandemic, so there were few if any supply-chain issues once COVID struck. And its supply needs are relatively simple.

“Some of these companies are putting together computers with 4,000 parts,” he explained. “We’re really working with wire fiber and attachment components; it’s not nearly a deep a supply issue as other companies had.”

Meanwhile, demand for many of the products made by the company, especially those in the gun-cleaning realm, has actually grown, again because of the growing levels of turmoil in the world.

“One of the concerns for the people was whether they’d have a job; they were seeing all these companies shut down around them.”

Carlson sounded similar tones, noting that, in many respects, the pandemic hasn’t impacted the overall bottom line; in fact, it has helped generate more business with some clients.

It didn’t look that way back in the spring, when the state’s shutdown, which most thought would last a few weeks, instead stretched to nearly two months. “At that point,” she said, “I was pretty confident that 2020 was going to be a bust.”

Instead, it’s shaping up to be better than last year — which was quite solid.

“We’re not just steady, we’re busy, and we’re getting busier,” she told BusinessWest, adding that the company had a record July, usually one of its slower months. “A lot of that’s on the defense, not aerospace, side, but also our defense aerospace has picked up a lot as well.”

But in addition to creating more work, the pandemic has also changed how work is carried out, creating a number of challenges for those managing plants, especially early on in the pandemic, when there was little guidance on how to keep workers safe — and also little hand sanitizer to be found.

“We had to get people to understand that they can’t stand shoulder to shoulder with one another — you have to maintain that six feet,” Carlson said. “I had put limits on the number of people who could be in rooms with closed doors; we’d take turns disinfecting the entire shop. In the morning, one guy does the shop floor, at lunchtime, another one does it, and at the end of the day, they do it again.”

Simonds agreed, and noted that, by strictly enforcing the rules and following the protocols, the plant has seen no cases, and no interruptions, since reopening.

“We’re sticking to the CDC protocols, and it’s worked for us,” he said. “Everyone is temperature-screened; everyone wears a mask at all times; we’re restricting meeting rooms based on square footage and number of people in the rooms; no employee gatherings beyond the number cited by the state; anyone who goes on vacation and travels outside of Massachusetts to a restricted area has to follow protocols coming back in.

“One of the challenges was just getting used to things,” he went on. “Wearing a mask, especially in the summertime, is difficult, but people have been great, and we’re all used to it now; it’s just a matter of practice.”

Round Numbers

For Simonds and his team, the state-ordered shutdown came, as noted earlier, during the busiest time of the year for the facility, which has enjoyed a resurgence over the past few years as Callaway has made huge strides in gaining market share within the golf-ball industry.

And turning everything off is, as he said, a somewhat complicated undertaking.

“For any machines that have materials in them, they have to be purged properly,” he explained. “We need to take all the raw materials that are sensitive to environmental conditions and put them in environmentally controlled areas. We need to take care of WIP — work in process — and try to process as much as possible so we don’t have time-sensitive WIP sitting on the production floor.

“It’s a matter of systematically shutting down operations so we don’t have inventory sitting in the wrong places,” he went on, adding that the process was made more complicated by the fact that no one really knew for how long the plant would be dark.

Meanwhile, on the personnel side, most all employees were furloughed — and nearly all of them came back, he went on, adding that the operation slowly wound back up, but since then, activity has sped up dramatically, with many of those employees securing large amounts of overtime.

“We’ve gone from zero to 100 as quickly as we could. Once the golf courses started opening up, the demand for product was almost unprecedented — there was so much golf being played,” Simonds said, adding that courses in most all states were open several weeks before the plant was reopened — if they had closed at all. “And the golf business has remained pretty strong; we’re chasing demand.”

The same is true at Peerless and Sanderson MacLeod, where, in addition to meeting orders, the plants are coping with new ways of communicating, meeting as teams, and planning, as much as possible, for what might come next.

And also learning and growing from the shared experience of not only coping with a pandemic and all the challenges it has brought, but in some cases thriving.

Indeed, Carlson said the past several months have brought a close workforce even closer together as they contend with the protocols, the surge in business, and a shared desire to be prepared for the worst-case scenario while hoping for something much better.

Borsari agreed, and said some of the real ‘opportunities,’ a word he’s hesitant to use in this climate, come in the broad area of relationship building when it comes to both clients and the team at Sanderson-MacLeod.

“It’s been a unique opportunity to connect with our client base in a way we haven’t done before,” he told BusinessWest. “It’s all about collaboratively figuring out the best way to keep both companies open; we’re really had a lot of good relationships become even better because we realize how dependent we are on one another.

“And as an organization, finding our way through this together has made us stronger,” he went on. “We’ve done everything we can as a company to make this a place of normalcy. Everything else around them was going crazy, and one of the key points we made in March was to do everything we can to follow the mandates and make sure our people are safe, but we also want to make sure to maintain normalcy as much as we can.”

Up Off the Floor

Looking ahead, Carlson said her company has taken what steps it can to be prepared for what might come next.

Yes, that means stocking up on toilet paper, hand sanitizer, and other pandemic-related needs that were in such short supply when the first wave hit six months ago.

“I’m ready for us to keep moving the way we’re moving,” she explained. “Even if we did walk back any of the phases of the reopening or went back into a shutdown, we’d still be open and still going at the pace we’re going, and perhaps be even busier; we’re prepared.”

But, as Borsari noted, even for manufacturers in the coveted ‘essential’ category, there is too much uncertainty to ever be comfortable, or fully prepared.

“Nothing is stable,” he said. “Just because we’re essential doesn’t mean anything’s safe or easy; so much is dependent on the attitude of the state, or the people who decide to come to work or not come into work, tariff measures, travel bans … all of these could have an impact.”

Such is life in a sector that, like most others, has seen COVID-19 change almost everything and create conditions that are anything but business as usual.

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

Law Special Coverage

Red Ink

Steve Weiss

Steve Weiss says he’s getting a steady volume of calls from business owners with questions about bankruptcy or liquidation.

Steve Weiss says the wave of bankruptcies that he and others in his line of work are expecting certainly hasn’t reached shore yet, to use a phrase appropriate for this time of year.

“But you can definitely see it building out there — it’s coming; you can see it rolling in,” said Weiss, who specializes in bankruptcies and workouts for the Springfield-based law firm Shatz, Schwartz & Fentin.

This wave is comprised of both corporate and consumer (personal) bankruptcies, and it will be large and hit with considerable force, he went on, adding that a number of factors are colliding that will make it so.

On the corporate side, while many companies have been able to hang on and survive the pandemic to date, they have done so thanks largely to government stimulus initiatives that are due to be exhausted soon, leaving business owners and managers wondering how they will pay people and all their bills. And on the consumer side … it’s a very similar story.

Indeed, unemployment benefits and stimulus checks have helped many make ends meet, but those checks are projected to end soon for large numbers of people, if they haven’t ended already.

“My phone is starting to ring more with business owners who are either unsure how they’re going to make it, or are sure they can’t — the virus has just clobbered their business,” said Weiss, who said his next phone call after the one with BusinessWest was with a business owner looking to talk about bankruptcy or perhaps liquidation.

“My phone is starting to ring more with business owners who are either unsure how they’re going to make it, or are sure they can’t.”

Such calls are starting to come in with increasing frequency, said Mike Katz, a partner with the Springfield-based firm Bacon Wilson and one of the region’s pre-eminent bankruptcy specialists. He used a different, though similar, metaphor to describe what’s coming.

“I think the dam is about to break — we’re on the cusp of a tsunami of bankruptcies,” he said. “It hasn’t happened yet, but it’s going to happen.”

There have already been many, especially on the corporate side, he went on, noting that many large and famous names, many from the retail sector, have filed for Chapter 11 protection. That list, which continues to grow, includes Lord & Taylor, J. Crew, Brooks Brothers, Gold’s Gym, Neiman Marcus, JCPenney, Hertz, 24-Hour Fitness, Chuck E. Cheese, California Pizza Kitchen, and Men’s Wearhouse.

Those names reveal the types of businesses that are most in jeopardy, Katz continued, adding that, locally, many small businesses in the hospitality, retail, and fitness realms — but many other sectors as well — face severe challenges as they try to survive the pandemic.

For some in this category, an emerging option is what’s being called the ‘fast-pass’ small-business bankruptcy process, otherwise known as Subchapter V of Chapter 11 of the Bankruptcy Code. This new subsection, which became effective in February, is not a response to COVID-19, but certainly seems to be tailor-made for the economic crisis the pandemic has created.

Mike Katz

Mike Katz is expecting a “tsunami” of bankruptcy filings. What he doesn’t know is when this wave will hit.

That’s because, as the name suggests, it is a faster, less expensive Chapter 11 reorganization path, designed specifically for much smaller businesses than those that seek the Chapter 11 route. To be eligible for Subchapter V, an entity or an individual must be engaged in commercial activity, and its total debts — secured and unsecured — must be less than $7.5 million, a new number (the old one was $2.725 million) resulting from provisions of the COVID-inspired CARES Act. At least half of those debts must come from business activity.

Katz and others we spoke with said the fast-pass option holds potential for some businesses, but there are challenges within its many provisions, including the need to come up with a reorganization plan within 90 days of the filing. Such plans may be difficult to develop given how difficult it is to see even a few weeks down the road, let alone several months, because of the pandemic.

“The one downside is you file your bankruptcy papers, and you’re required, within 90 days, to put a plan in place,” said Mark Cress, a bankruptcy specialist with the Springfield-based firm Bulkley Richardson. “That’s a short window, and a lot of small businesses are barely holding their own.”

For this issue and its focus on law, BusinessWest talked with these bankruptcy lawyers about what they can already see coming. They can’t predict when this particular surge will begin, but they say it’s almost unavoidable.

Chapter and Verse

While Katz and Weiss were crafting analogies to waves and tsunamis, Cress wanted to draw parallels to the Great Depression.

Indeed, he told BusinessWest that the current conditions rival, and in some cases (such as the quarterly decline in GPD) actually exceed those of the Great Depression that started roughly 90 years ago.

“This is worse than the Great Depression in a lot of ways,” he said. “The dip in the economy — it dropped by a third — was something we’ve never seen before. And but for the way the Fed has handled this, it would be devastating; those multi-trillion-dollar programs … they’re the only thing that’s sustaining us. Without that, the whole house of cards would collapse.”

To further state his case — that’s an industry term — Cress pointed to numbers contained in an analysis authored by Morning Consult economist John Leer, who noted that, without additional funding, millions of unemployed Americans are at risk of financial insolvency by the end of this month.

“The personal finances of workers who have been laid off or placed on temporary leave since the onset of the pandemic deteriorated in July,” Leer wrote. “The July survey found that 29% of unemployed and furloughed workers lacked adequate savings to pay for their basic living expenses for the month, up 16% in June. This monthly change contrasts with June, when the finances of laid-off and furloughed workers improved. At that point in time, many renters and homeowners took advantage of the rent-deferral and mortgage-forbearance options included in the CARES Act, thereby driving down their monthly expenses.”

Mark Cress

Mark Cress says the new ‘fast-pass’ bankruptcy process may be a viable option for some, but the process doesn’t leave business owners much time to create a reorganization plan.

Cress backed up that commentary with some other, very sobering numbers regarding renters.

“One-third of all renters weren’t able to make their July rent,” he noted. “And more than 60% were concerned they won’t make August. So you can imagine the ripple effects this will have … many small-time landlords, with one or two tenants, may not be able to pay their mortgage.

“And you if get enough defaulted mortgages … then banks start to pull in their horns, and all of a sudden the credit markets freeze up, and you have a real disaster,” he went on, drawing analogies, again, to what happened nine decades ago.

Looking at these statistics and possible scenarios, it’s easy to see why bankruptcy lawyers are expecting a wave, or tsunami, of personal bankruptcies to hit this area — and the nation as a whole — soon, with ‘soon’ being a relative term.

“Some people are getting unemployment benefits, but it looks like that’s ending,” said Weiss. “There’s a foreclosure and eviction moratorium that’s ending in October, and there are already people living on credit cards and exhausting their savings just trying to get through this — and it’s going to be a while before jobs come back.

“So it’s a matter of sooner than later,” he went on. “And bankruptcy is something of a trailing indicator; it takes people a while to get the point where they need to file for bankruptcy — the credit-card bills don’t become unmanageable until several months go by.”

By the Numbers

But the wave will almost certainly involve corporate bankruptcies as well, said those we spoke with, noting that many businesses have struggled to merely survive the past five months. And with the state already pumping the brakes on its reopening plan as reported cases increase, and ever more uncertainty about the future, survival is becoming more of a question mark for many businesses.

That’s especially true within the restaurant sector, said those we spoke with, noting that, while many have been able to reopen, their revenues are still a fraction of what they were pre-COVID. And with fall and then winter coming — meaning far fewer opportunities to serve outdoors — some in this sector are wondering if, and for how long, they can hang on.

“I think the dam is about to break — we’re on the cusp of a tsunami of bankruptcies. It hasn’t happened yet, but it’s going to happen.”

“I’ve been contacted by a number of restaurants, in particular, over the past few months,” said Katz, adding that there have been inquiries from those in other sectors as well. “Some of these have managed to hold on, some have closed some locations while keeping others open … but the number of people I’ve talked to just today tells me that the dam is just teetering, and I think there’s going to be unprecedented times in the bankruptcy field.”

This speculation leads him back to the new fast-pass small-business bankruptcy process, and questions about just how many businesses may try to take advantage of this emerging option, and whether they can be successful with such bids.

“I think a lot of businesses will try doing this because you have a 90-day maximum to get in and get out — that’s how fast this Chapter 11 is going to go,” he explained. “And the whole thing is predicated upon the fact that you only have to propose a plan that provides more to the creditors than they would receive in a liquidation, with no voting.

“Under the current Chapter 11 process, there’s a whole voting process, where you have to get two-thirds of the dollar amount and a majority of the number of creditors to vote in favor of it,” he went on. “But with this process, there’s no voting — it’s a much more streamlined process, and it’s far less expensive.”

With the new ceiling of $7.5 million, many more businesses are now eligible to take this route. But that same 90-day in-and-out period, while attractive in one respect, is daunting when it comes to actually putting a reorganization plan in place.

“I’ve talked with a number of people about it because people are still trying to figure how it works — there isn’t a lot of legal guidance or precedence,” said Cress. “But having to put a plan together in 90 days is going to be very difficult for many small businesses. If you don’t have any profits or any cash and you’re living hand to mouth, it really places an undue burden on you to figure it all out and get creditor sign-off in 90 days.”

Katz agreed. “Most traditional Chapter 11 cases are multi-year, and reorganization is based in projections,” he told BusinessWest. “How do you project when this COVID situation is going to change? If you’re a restaurant, how can you project when people are going to come back to your restaurant and you can go back to something approaching capacity?”

The Bottom Line Is the Bottom Line

Those lawyers we spoke with all expressed a desire not to sound like an alarmist.

But as they talked about what they’re seeing, reading, and hearing on the phone calls they’ve already taken, they admit it’s difficult not to take that tone.

“For many businesses, it’s a matter of survival at this point,” said Cress, noting that survival is becoming more difficult in some sectors with each passing month. “It’s becoming apparent that the recovery is not going to happen as quickly as some had originally hoped, and the effect is going to be much deeper and longer-lasting than people are even letting on.”

And one seemingly unavoidable consequence of all this is bankruptcies, on both the corporate and consumer sides of the ledger.

As Weiss said, the wave hasn’t crashed ashore yet, but if you look — and you don’t have to look hard — you can see it building.

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

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 19: Aug. 17, 2020

George Interviews John Gannon, employment law specialist with Skoler Abbott

George interviews John Gannon, employment law specialist with Skoler Abbott, and they discuss the top questions and concerns of employers during the pandemic including how companies are struggling bringing their employees back to work, and provides legal guidance moving forward. 

Sponsored by:

Also Available On

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 18: Aug. 12, 2020

Thom Interviews Paul Silva & Kelly Minton of Innovation Accelerator

Innovation Accelerator teaches nonprofits how to develop, test, and deploy new mission-aligned, revenue-generating programs. Co-founders Paul Silva and Kelly Minton join Thom Fox to discuss how they are helping Western Massachusetts nonprofits identify unrestrictive revenue streams to offset funding challenges brough about by the COVID-19 pandemic.

Sponsored by:

Also Available On

Features Special Coverage

Mission: Accepted

Paul Belsito

Paul Belsito

Paul Belsito admits he’s struggling somewhat with Zoom and conference calls — not the technology, but the nature of those forms of communication.

He’s a people person, and he likes meeting them face to face — and not on screen or over the phone.

“I enjoy going to events and networking — that’s how I meet people,” he said, noting that there haven’t been any opportunities like that since he’s arrived, and he’s looking to the day when they return. “Zoom is OK, and I’m getting good at it, but it’s not the same.”

But it is reality in the summer of 2020, and this is how Belsito, chosen late this spring to fill the rather large shoes of Mary Walachy as executive director of the Irene E. and George A. Davis Foundation, has been going about what will remain his primary assignment for the foreseeable future.

And that is to ‘meet’ as many people as possible and come to fully understand the many issues and challenges facing the Western Mass. community.

“This is a world built on relationships, and you have to understand people’s perspectives and listen actively so you can help build on the foundation that’s been laid,” he explained, adding that, since arriving in early June, he’s been doing a lot of listening, with the intention of acting — and collaborating with others — on what he’s hearing.

It’s an assignment he accepts with considerable enthusiasm, and one to which he brings an intriguing background, blending work in financial services, government (he was district director for state Sen. Edward Augustus), higher education (he was executive assistant to the president at Assumption College in Worcester, his alma mater), and philanthropy; most recently he served as president of the Hanover Insurance Group Foundation in Worcester and assistant vice president for Community Relations.

And he intends to draw on all that experience in a role that involves everything from community outreach to regional problem solving, but mostly comes down to what Belsito calls “impact philanthropy.”

“A lot of my work has been grounded in community work,” he said, using that phrase to describe many of his career stops. “Getting involved and influencing has always been part of my DNA, and it’s generational in many ways — my family was very involved in the community in Worcester.”

This devotion to community work, as well as an opportunity to continue and build on Davis Foundation initiatives in literacy, early-childhood education, improving the Springfield Public Schools, and other endeavors, drew him to the Davis Foundation, created by George Davis, founder of American Saw & Manufacturing, and his wife Irene, and the opportunity to succeed Walachy, whose work he has admired from Worcester.

“The work that Davis has done in literacy and specifically early education is well-known throughout the Commonwealth,” he noted. “I had known them from that lens of an active member in a peer community trying to work on the same issues; Mary is a household name in the early-education space throughout the Commonwealth, and her name is often brought up as someone to model in her guidance on how to pull these programs together.”

Coming to Springfield from Worcester, Belsito said there are many similarities between the state’s second- and third-largest cities (with Worcester being the former), and common challenges. These include everything from education to economic development and job creation. But they are different and unique communities with their own “personalities,” as he called them.

“This is a world built on relationships, and you have to understand people’s perspectives and listen actively so you can help build on the foundation that’s been laid.”

“Worcester and Springfield are not the same, although they do have similar traits,” he noted. “It’s my job to listen and maybe take some of my experiences from Worcester and share those with folks in Springfield. Maybe one in 20 will catch and improve the lives of children and families.”

Meanwhile, recent events have brought other priorities to the fore, including the plight of the region’s nonprofits, many of which have been severely impacted by the pandemic from the standpoints of revenue and sustainability, and the broad issue of racial justice, which the foundation has helped address through creation of the Healing Racism Institute, now a separate 501(c)(3), but still very much affiliated with the Davis Foundation.

Educare Springfield

Paul Belsito says his primary goal is to build on the foundation created by the Davis Foundation with initiatives such as Educare Springfield, a unique early-education facility that opened its doors last fall.

And these emerging issues are dominating many of those discussions he’s been having as he goes about listening and building relationships.

For this issue, BusinessWest talked at length with Belsito about his new role, but especially about the challenges facing Springfield, the region, and its large core of nonprofits — all of which have looked to the Davis Foundation over the years for not simply financial support, but also direction and leadership.

Moving forward, he said the foundation will be continuing in those roles and constantly looking for new ways in which to make an impact and move the needle.

Background: Check

Tracing the steps that brought him to the Davis Foundation’s suite of offices in Monarch Place, Belsito said his professional career started at Flagship Bank and Trust Co. in Worcester, where he served as a trust administrator, working with families to help manage their assets and trusts.

While in that role, he started doing volunteer work within the community, and before long, his career aspirations changed.

“All of a sudden, everything flipped, and the volunteer work became a career,” he told BusinessWest, adding that, in 2005, he started working for Augustus, now the city manager in Worcester. After a stint as a private consultant, he became executive assistant to the president at Assumption, which was, in many ways, a continuation of the work he did at the State House.

“I worked for a state senator who was very driven by policy, not politics,” he explained. “His mindset was, while we were in that building, how could we improve the lives of people not only in that district, but across the Commonwealth? The policy piece was very important to me, and it carried over to the higher-education piece.”

From Assumption, he went to Hanover Insurance, which, like MassMutual in this market, has historically been deeply involved in the community, often serving as a “catalyst for change,” as he put it.

He started in community relations and eventually became president of the Hanover Insurance Group Foundation.

“As we began to pivot on how to not only make the company a world-class company but also the city in which it was headquartered, I did a lot of work with the Worcester Public Schools, with the Hanover Theater, and various organizations within the community that really helped to round out the experience for children and families so that they would be successful out in the community,” he said, noting that perhaps the most significant initiative launched by the Hanover Foundation is the Advancement Via Individualized Determination (AVID) college-readiness program in the Worcester Public Schools.

“It was an honor to work for a company that was so committed to impact philanthropy,” he went on, “which is trying to move the needle and have outcomes and data that support the investment that you’re making.”

Slicing through his job description at Davis, he said it’s to generate this type of needle-moving philanthropy — or more of it, because the foundation has been involved in a number of potentially game-changing initiatives, including Cherish Every Child, a nationally recognized Reading Success by 4th Grade program, the advocacy group Springfield Business Leaders for Education, and, most recently, the effort to establish the innovative Educare Springfield early-education center, which opened last fall near the campus of Springfield College.

“One of the things that struck me about the Davis family was the humility with which they do their work. They want to be sure they’re supporting things that generate outcomes and improve the quality of education and quality of life for children and families in the region.”

The desire to continue such initiatives and create more of them brought Belsito to Springfield (via Zoom) to interview for the Davis job, a job posting that came about as he was looking for a new challenge after spending a short stint working for the city of Worcester on its COVID-19 response.

“I had known of Davis for a long time — and we actually used Davis and the work that Springfield was doing as one of the models as we were developing a reading-for-success program what would work best for our community.”

Forward Thinking

Looking ahead, Belsito said that, as the Davis Foundation continues its mission of service to the community, the specific direction of its initiatives will be determined by recognized needs within area cities and towns.

But he’s certain that education and a hard focus on young people will be at the heart of those discussions.

“One of the things that struck me about the Davis family was the humility with which they do their work,” he explained. “They want to be sure they’re supporting things that generate outcomes and improve the quality of education and quality of life for children and families in the region.

“And if you look at the legacy of the family, that’s been a consistent theme,” he went on. “And as we look to the next phase of where the Davis family’s impact will be, I believe that it will consistently be in education and literacy, but we also have a new generation of family members who are getting more active within the community, so how do we integrate some of their perspectives in making sure that we have a consistent, shared goal of improving the lives of children and families in Hampden County?”

Beyond this shared goal, there are new and emerging needs within the community, he said, noting, as one example, the mounting challenges facing the region’s large core of nonprofit organizations, many of which were struggling with finances before COVID-19.

“Many nonprofits are in a vulnerable state from a financial perspective,” he noted. “And this experience from the past few months has only exacerbated that. So we want to look at how Davis and organizations like the Community Foundation of Western Mass. can come together to help ensure that the mission-driven organizations that are needed for the community to be successful can thrive and be able to provide the services they need.

“Even from the start of my interview process at Davis to today, a lot has changed,” Belsito went on, referring not only to the pandemic and its repercussions, but also George Floyd’s death and the resulting focus on racial justice. “Perspectives have changed, and priorities have changed, and so we need to convene people at the local level and ask, ‘what does this community need to be successful?’”

What hasn’t changed are the many social determinants of health — from housing and transportation to food insecurity and job losses — that are impacting quality of life in the region, he continued, adding that COVID-19 has helped shine a light on inequities in the system and the need to initiate steps to address them.

And when it comes to such efforts and other initiatives, the key is listening to members of the community and creating a dialogue about to address these problems, he said, adding that the Davis Foundation has historically been a leader in such discussions, and it will continue to play that role into the future.

“I’m a believer that, when you pull people together, there’s usually a solution that can be found,” he said, using that phrase to refer to everything from the sustainability of nonprofits to improving public education.

‘Meeting’ the Challenge

Left with what he says is little choice, Belsito has become quite savvy with Zoom and other virtual methods for meeting and getting to know people.

It’s not as he would want it, but it is indeed reality. And so are the many challenges confronting Springfield and the region, many of them amplified or accelerated by a pandemic that has been relentless.

Belsito said his first assignment is to understand what makes Springfield Springfield, and it is ongoing. From there, his job is to pull people together — something the Davis Foundation has always been good at it — and, when possible, move the needle.

He’s made it a career to take on such work, and he’s more than excited about what the next chapter might bring.

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

Coronavirus Special Coverage

Step Inside

Jade Jump and Nate Clifford

Jade Jump and Nate Clifford, owners of Cornucopia in Northampton.

For Dave DiRico, the forced shutdown of retail outlets across the Commonwealth in March could not have been more ill-timed.

After all, late March is when many golfers, a good number of them armed with gift certificates from the holidays, start filing into his store in West Springfield, DiRico’s Golf & Racquet, and reload for the coming season. They come in looking for new clubs, balls, bags, shoes, and other accessories.

And they keep coming in through the spring, said DiRico, noting that, aside from the holidays, March, April, and May are by far his busiest months.

But not this year, obviously, as he was closed completely until early May and then open for curbside sales only — something this business isn’t really suited for — for several weeks.

But when he did reopen … well, the surge in business might not make up for everything that was lost during the shutdown, but it has been significant and in many ways surprising. Indeed, in addition to what could be called pent-up demand — people who needed to reload and had to wait until he was open to do so — the pandemic has actually created a mini-explosion of interest in golf, because it’s one of the few sports that can still be played under the current restrictions and advisories on social distancing.

“Things took off … it’s been crazy,” DiRico told BusinessWest. “One of the few outdoor activities you can have right now is golf; we have kids who were supposed to do internships and can’t, and they’ve taken up golf. We have kids who played baseball and summer sports and couldn’t play those, so they’ve taken up golf. We have spouses who’ve never played the game who have taken up golf.

“Couple that with our regular business,” he went on, “and June and July have taken off like a rocket ship.”

Nate Clifford has also navigated the ups and downs of shutting down and reopening at Cornucopia, the natural-foods store he and his wife, Jade Jump, own at Thornes Marketplace in downtown Northampton. They were among many shop owners who had to shift their business model on the fly to survive the past few difficult months.

“Shoppers are saying, ‘I just wanted to shop with somebody locally.’ We’re hearing a lot of that. I think that’s awesome.”

In fact, March 15, the day they and all the other Thornes stores shut down, was the couple’s one-year anniversary of buying the 40-year-old establishment. Though sales of food and wellness products may have made Cornucopia an essential business in the state’s eyes, Thornes made a decision to shutter the whole complex, and that meant Cornucopia, too.

“We understood, but we made an impassioned plea to the landlord to give us some access for pickup and delivery, with the goal of helping people, especially the older population around here who need us,” Clifford said. One day later, on March 16, they were back in business with that new model.

“We put a simple order form up on the website and told people, ‘you shop here; you know what’s here — what’s your wish list, and we’ll get the best possible order for you.’ We delivered, or you could pick it up and we’d run it out to you, put it in your trunk or in the passenger window, whatever you were comfortable with. We did that for three months, and we were overwhelmed with the support we got.”

That support was certainly reflected on June 15, the first day shoppers were allowed back in the store itself. “We had such a rush of people, I had to step into the back room to shed a few tears,” Clifford said. “I thought, ‘we’re going to be OK.’”

Unfortunately, not all retailers can say the same thing. They’ve seen some pent-up demand, to be sure, but 2020 is turning into a very challenging year as many shoppers are staying home, cutting back on their spending (or both), and doing most of their buying online.

Still, retailers are happy to be open again, even if the long-term outlook is mixed, and consumer confidence remains uncertain.

One Step at a Time

Sharon Cohen, who has owned Footbeats for Women at Thornes for the past four years, noted that, without college students and tourists from out of town, business is slower than is typical for this time of year, but customers are returning steadily. She’s happy to see them, especially after instituting the safety measures mandated by the state — and by common sense.

“We’ve revamped the way the store is laid out to promote social distancing,” Cohen said. “Shoppers are saying, ‘I just wanted to shop with somebody locally.’ We’re hearing a lot of that. I think that’s awesome.”

After Thornes was shut down in mid-March, Cohen launched a website so customers could still purchase her shoes, and, like Clifford, she delivered to peoples’ homes. Every Friday afternoon, she used Facebook Live to talk about shoes in stock and offer commentary on trends and new styles.

“I’d pick them off the displays on the wall and talk about them. Customers would text and ask questions about cost or size,” she said, noting that she will likely continue that practice. “We tried new, inventive ways to meet the customers.”

In the store, she tries to strike a balance between customer needs and safety; for example, when customers try on a pair of shoes, if they are leather and cannot be sanitized, the shoes are put in quarantine for 24 hours, as per Centers for Disease Control and Prevention (CDC) guidelines.

Dave DiRico

Dave DiRico says a mini-explosion in the popularity of golf has helped offset some of the huge losses incurred when his shop was shut down by the pandemic during the spring.

Thornes management has instituted many new protocols and equipment, including iWave ionizing air filters that heighten air quality, foggers that sanitize the building nightly, and door monitors at each of the two open entrances to ensure that people entering wear masks and sanitize their hands. The complex also installed hands-free door openers on bathroom doors.

“Thornes has done a lot to prepare for our opening, and we continue to stay educated and follow safety protocols,” said Richard Madowitz, the marketplace’s co-president. “We are receiving consistent positive feedback from shoppers on the cleanliness of the building and their comfort. We are providing a safe environment.”

All shared tables and chairs on the building’s second and third floors have been removed, and directional arrows on the floors separate traffic and promote social distancing.

“Signage is everywhere,” Madowitz stressed. “Each store is managing its state-mandated capacity count, and Thornes itself is managing the state-mandated capacity counts for its common spaces without shops.”

“I make sure people who come into the store feel safe. I’m doing what I feel is right by my customers and staff. That’s my focus.”

Mask compliance is high, at 99%, he noted, adding that “masks are not required for those with medical conditions that prevent them from wearing one.”

Despite what he calls a “vocal minority” making waves nationally about mask wearing, Clifford said his customers have been respectful of the mandate.

“We’re dealing with people who have health issues, and I’d say the average customer spending big amounts is over 50, getting supplements, taking to our expert staff. We want them to feel safe,” he told BusinessWest. “For those folks who don’t want to wear masks, even for legitimate reasons, we still have pickup and curbside. But I make sure people who come into the store feel safe. I’m doing what I feel is right by my customers and staff. That’s my focus.”

Visitors to Holyoke Mall are greeted with a similarly wide range of mandates, from face coverings and six-foot distancing to directional arrows and guidance to wash hands, use sanitizer, and avoid touching products unless purchasing them, said Lisa Wray, the mall’s director of Marketing.

In return, the mall has enhanced its cleaning and sanitizing of the common areas and numerous touch points, restrooms, seating areas, and food court, and the cleaning team is utilizing new electrostatic sprayers, leveraging the same technology used to clean hospital rooms, using an approved disinfectant recommended by the CDC. In addition, Holyoke Mall employees, security, housekeeping staff, and contractors undergo daily health screenings.

Sharon Cohen

Sharon Cohen says she used online outreach and a sales website to stay afloat during the shutdown.

All those steps were necessary, Wray said, to not only bring customers back, but make them feel safe upon return.

“Having our tenants close with thousands of employees and their livelihoods impacted is certainly difficult; however, the safety and well-being of our guests, employees, and tenants is of primary importance,” she told BusinessWest.

“We have been seeing guests steadily return to the shopping center, and even with reduced occupancy, tenants have been seeing strong sales,” she added. “With the back-to-school season upon us and the sales-tax holiday weekend at the end of August, we’re hopeful the months ahead will continue to trend positively. We’re cautiously optimistic that the fourth quarter will continue to ramp upward, as guests adapt to this new way to shop.”

Warning Signs

That optimistic view isn’t shared by the entire retail industry. Just last week, two businesses at the Shops at Marketplace in downtown Springfield — Serendipity and Alchemy Nail Bar — announced they were closing, unable to stay afloat after the forced pandemic closure and an inability to procure business aid from either the federal Paycheck Protection Program or the city’s Prime the Pump grants.

Meanwhile, on a national level, Tailored Brands, which owns suit sellers Men’s Wearhouse and Jos. A. Bank, is closing hundreds of stores and drastically reducing its corporate workforce as the pandemic continues to decimate the retail industry.

GlobalData Retail recently noted that year-over-year sales of men’s formal clothing fell by 74% between April and June, and not just because stores were closed. “While this deterioration will ease over time, demand will remain suppressed for the rest of 2020 and well into 2021 as office working, business meetings, and socializing are all reduced.”

Fortunately for DiRico, the pandemic has done the opposite in the golf sector, creating some opportunities in the form of new players who need equipment — with many of them using stimulus checks to buy it. But there are challenges as well, starting with shortages of stock caused by closure of factories and then restrictions on capacity.

“Our biggest problem right now is getting equipment,” he explained. “That’s because most of our manufacturers are based in California, where only 40% of the factory is open, which means they can only produce ‘X’ amount of clubs for the world; it’s slow in getting equipment.”

Other challenges include the many the new rules and protocols regarding social distancing and sanitizing, he went on. Still, for the customer, things are pretty much business as usual, meaning they can still try on shoes or gloves and take a few practice swings with a driver in the simulator.

‘Normal’ is not a word that comes to mind when describing operations or this year in general, but overall, the surge the game has seen will certainly help make 2020 less forgettable, DiRico went on, and it offers considerable hope for the future — if those who have taken up this difficult, expensive, and time-consuming game can find a way to stay with it.

“For the past 15 years or so, golf has been on the decline,” he said, listing cost and time among the big reasons. “Now, some of the pros I’ve talked with say they’re booked solid; they have tee times from 6:30 to 4. And membership at the country clubs is up. If these clubs can retain just 15% of these new golfers, they’ll be in good shape.”

For Cornucopia, the pandemic offered an opportunity to build an online, pickup, and delivery presence it might not have otherwise, Clifford said — one it will continue to maintain, opening up new business avenues.

“We were thrilled to be able to pivot to that quickly. That’s one thing Jade and I do well, being flexible and doing whatever we need to survive. We’re resilient, and now that we have a strong foundation, if we were ever to experience another shutdown, we’ll be able to continue the cash flow.”

These days, sales volume isn’t what it was on reopening day on June 15, and won’t be until colleges are back in session. “That’s when you normally see more foot traffic; July is not a busy retail time,” Clifford noted, adding that a weakened tourism season isn’t helping, as even visitors to the Berkshires often make their way to downtown Northampton for an afternoon. “That’s not happening right now.”

But he’s cheered that all the Thornes businesses are open seven days a week. “That has caused a lot more consistency in the shopping experience, when the stores are open and welcoming people and wanting them to come in and physically shop.”

And hoping that extended shutdown is a thing of the past.

Joseph Bednar can be reached at [email protected]

Accounting and Tax Planning Special Coverage

By All Accounts

By Jim Moran CPA, MST

Jim Moran CPA, MST

Jim Moran CPA, MST

The Coronavirus Aid, Relief, and Economic Security (CARES) Act has provided taxpayers affected by COVID-19 with some relief in the area of retirement-plan distributions and loans.

A coronavirus-related distribution is allowed by a qualified individual from an eligible retirement plan made from Jan. 1, 2020 to December 31, 2020, up to an aggregate amount of $100,000. A qualified individual must meet one of these criteria:

• Diagnosed with the virus SARS-CoV-2 or with the coronavirus disease 2019 (COVID-19) by a test approved by the Centers of Disease Control and Prevention (CDC);

• Spouse or dependent is diagnosed with SARS-CoV-2 or COVID-19 by a test approved by the CDC;

• Experienced adverse financial consequences as a result of being quarantined, furloughed, laid off, having work hours reduced, or being unable to work due to lack of childcare due to SARS-CoV-2 or COVID-19; or

• Experienced adverse financial consequences as a result of closing or reducing hours of a business that is owned or operated by the individual due to the SARS-CoV-2 or COVID-19.

An ‘eligible retirement plan’ is defined as the type of plan that is eligible to accept tax-free rollovers. It includes 401(k) plans, 403(b) plans, governmental 457 plans, and IRAs (including SEP-IRAs and SIMPLE-IRAs). It does not include non-governmental 457(b) plans. The $100,000 withdrawal limit applies in aggregate to all plans maintained by the taxpayers.

For individuals who are under age 59½, the act waives the 10% early-withdrawal penalty tax. Although the 10% penalty will be waived, any potential income taxes associated with the retirement plan or IRA withdrawal will still be assessed. The act also suspends the 20% tax-withholding requirements that may apply to an early distribution from a 401(k) or other workplace retirement plan.

“Your tax liability owed to the IRS at the end of the year may be higher than expected if you choose not to withhold the suggested 20%.”

Just keep in mind, your tax liability owed to the IRS at the end of the year may be higher than expected if you choose not to withhold the suggested 20%.

When it comes to paying the resulting tax liability incurred due to the coronavirus-related distributions, the CARES Act allows you a couple of options: spread the taxes owed over three years, or pay the taxes owed on your 2020 tax return if your income (and, thus, your tax rate) is much lower in that year.

Taxpayers may also repay the coronavirus-related distributions to an eligible retirement plan as long as the repayment is done within three years after the date the distribution was received. If the taxpayer does repay the coronavirus-related distribution in the three-year time period, it will be treated as a direct trustee-to-trustee transfer so there will be no federal tax on the distribution. This may mean an amended return will have to be filed to claim a refund attributable to the tax that was paid on the distribution amount that was included in income for those tax years.

Retirement-plan Loans

Loans from eligible retirement plans up to $100,000 to a qualified individual are available for any loans taken out during the six-month period from March 27, 2020 to Sept. 23, 2020. This is up from the previously allowed amount of $50,000.

Participants must repay standard retirement-account loans within five years. The CARES Act allows borrowers to forgo repayment during 2020. The five-year repayment clock begins in 2021. The loan will, however, continue to accrue interest during 2020.

If you have an existing loan outstanding from a qualified individual plan on or after March 27, 2020, and any repayment on the loan is due from March 27, 2020 to Dec. 31, 2020, the due date for any loan repayments are delayed for up to one year.

Employers may amend their plans for the above hardship provisions to apply no later than the last day of the plan year that begins on or after Jan. 1, 2022 (Dec. 31, 2022 for a calendar-year-end plan). An additional two-year window is allowed for governmental plans; however, IRS Notice 2020-51 clarifies that employers can choose whether to implement these coronavirus-related distribution and loan rules, and notes that qualified individuals can claim the tax benefits of coronavirus-related distribution rules even if plan provisions are not yet amended.

Administrators can rely on an individual’s certification that the individual is a qualified individual (and provides a sample certification), but also notes that an individual must actually be a qualified individual in order to obtain favorable tax treatment. IRS Notice 2020-50 provides employers a safe-harbor procedure for implementing the suspension of loan repayments otherwise due through the end of 2020, but notes there may be other reasonable ways to administer these rules.

Please note that the loan provisions apply only to qualified plans such as 401(k), 403(b), and governmental 457 plans; loans may not be taken from IRAs.

Each retirement plan’s rules and requirements supersede the CARES Act. In addition, it is important to remember that not all retirement-plan sponsors allow loans. Before taking out any loan, it is important to check that your employer’s plan adopts these provisions.

Suspension of RMDs

The CARES Act has suspended required minimum distributions (RMDs) for 2020. Individuals over age 70½ (for those born prior to July 1, 1949) or 72 (for those born after July 1, 1949) were required to take a minimum distribution from their tax-deferred retirement accounts.

Most non-spousal heirs who inherited tax-deferred accounts were also required to take an annual RMD. Under the CARES Act, RMDs from qualified employer retirement plans such as 401(k), 403(b), and 457 plans, will be waived. Even those individuals not affected by the coronavirus can waive the RMDs.

For individuals who have already taken their 2020 RMD, the CARES Act allows you to put it back into your retirement account. IRS Notice 2020-51 qualifies the distribution as an eligible rollover distribution if repaid in full by Aug. 31, 2020.

Jim Moran is a tax manager at Melanson, advising clients on individual and corporate tax matters; [email protected]

Special Coverage Technology

Taking the Long View

The idea of doctors and patients communicating across a distance, via a video connection, is not a new one, Carl Cameron notes. But COVID-19 “opened the floodgates” to making it a reality for millions.

“The barriers that have always been there for telemedicine are, one, you had to be able to see the patient, and two, the reimbursement around it. But with COVID, all that got waived,” said Cameron, chief operating officer at Holyoke Medical Center (HMC). “And the governor came out and said, ‘look, for televisits and the phone, video, however you can get the visit done, and we expect the payers to pay for it like it’s an in-person visit.’”

So health organizations started doing just that. “We started with basic things like getting some iPads, getting some physician PCs set up, and then it was, ‘OK, what are we going to use for an application?’” Cameron said, noting that they started with a mixture of FaceTime, Google Meet, and a product known as Doximity.

“A lot of doctors are familiar with that; it meets all the security requirements of HIPAA in terms of being a secure channel,” he explained. “You basically send a link to the patient, and they just click it, and it creates the connection with the doc. It even uses a virtual telephone number for the doc, so it doesn’t have to be their actual cell phone. It’s a very easy process.”

Among the physicians pleased with the expansion of telehealth is Dr. Kartik Viswanathan of Holyoke Internal Medicine.

“Before the pandemic happened, we were seeing close to zero televisits. During the pandemic, we started doing televisits to reduce the number of people coming in. Infection was rampant, and at that time, we didn’t want people in the waiting rooms, and when seeing patients, we needed to be completely in PPE and masks.”

“The barriers that have always been there for telemedicine are, one, you had to be able to see the patient, and two, the reimbursement around it. But with COVID, all that got waived.”

So government did the right thing, he added, freeing up telehealth to be billed like a regular office visit. “Remarkably, it was very popular with patients. They loved it,” he said, noting that patients appreciated not having to drive to the office, and if a doctor was running late, it was OK, since they were at home. “They weren’t upset if they were 15 or 20 minutes behind.”

Cameron agreed. “We were using it wherever possible and where the government would allow us to get paid for it. Obviously, with COVID, nobody wanted to leave their house — as a country, we didn’t have a good understanding of how the disease spread; everyone was saying shelter in place, so people didn’t really want to go out.

As a result, practices saw significant dips in volume, he went on. “But as we put the telemedicine in place, I was eventually able to bring us up to just below pre-COVID numbers for office visits. We still had some patients, depending on the acuity, who needed to be seen in the office or the ER, but we were doing 75% to 80% of our visits via telemedicine.”

Viswanathan said having the distance alternative reduced anxiety in patients during a generally anxious time. “They were happy to see us. Even with COVID testing, people had so many questions, and just the fact they could speak with us, communicate with us, really relieved a lot of the anxiety for them.”

Carl Cameron

Carl Cameron says the technology needed for effective telehealth exists, and so does patient demand.

And now, with medical practices largely back open, albeit under strict safety protocols? “Televisits are here to stay,” he told BusinessWest. “As a provider, I find it convenient, and the patient finds it convenient. I think it will still be 20% to 30% of daily visits even after the pandemic is over.”

Pros and Cons

Viswanathan conceded that televisits aren’t the same as in-person visits, in a number of key ways.

“The challenges come when we don’t know the patients from before — when it’s a new patient we’ve never seen before. There’s a little discomfort level that I haven’t seen him. But for established patients and managing chronic illnesses, it’s just great,” he said.

“It can’t replace all office visits because we really need to see some patients — there are subtle signs we tend to miss if we’re seeing only through a camera. There are procedures we can’t do on a television. If they have a rash, that is not well-examined on television. Those are some challenges.”

Medical organizations have brought up technology access gaps as well, particularly among certain demographic groups. Health Affairs, an online publication of Project HOPE, recently reported that more than one in three U.S. households headed by a person age 65 or older do not have a desktop or a laptop, and more than half do not have a smartphone. While family members or caregivers can help, one in five Americans older than age 50 suffer from social isolation.

Access to technology is also a barrier in other ages and minority groups. Children in low-income households are much less likely to have a computer at home than their wealthier classmates. More than 30% of Hispanic or black children do not have a computer at home, as compared to 14% of white children.

“We evolved from doing it very quickly and responding to the pandemic — how do we keep our patients safe and get them the best care possible? — to asking, what does this look like going forward?”

Even on the provider side, organizations have work to do to fit telehealth seamlessly into traditional practices, Cameron said.

“We need to continue to beef up the infrastructure so that it allows for effective management of both televisits and in-person visits, so that the physician can be flexible,” he explained. “They can take a laptop, go into a room, do a normal visit with a person, do their documentation, and then, for televisits, go slide it into a docking station where they have two monitors up; they’ve got the documentation and can see the patient at the same time, right in front of them.”

Like other trends that evolved on the fly during the pandemic, like remote work (see story on page 22), telehealth may have served its purpose well during these chaotic months, but to make it a permanent fixture will require planning.

“We evolved from doing it very quickly and responding to the pandemic — how do we keep our patients safe and get them the best care possible? — to asking, what does this look like going forward? With the efficiency and effectiveness I saw with our practices, this is absolutely a tool we can continue to develop.”

One of the evolutions in Cameron’s organization may be a move toward expanding the use of Doximity, perhaps in conjunction with the Meditech web portal, where parients can schedule a telehealth visit on the latter, and the link is sent via Doximity.

“It’s not like the technology isn’t there, and it’s going to continue to evolve and move forward,” he went on. “But what’s made it a reality is now, you can get paid for it, and there’s some funding out there to beef up the infrastructure.”

Peace of Mind

While primary care and certain specialties are making strong use of telemedicine, behavioral health has been a particularly fertile field. The Mental Health Assoc. (MHA) began using its own platform, called TeleWell, through its BestLife Emotional Health and Wellness Center in January, just before COVID-19 arrived in the U.S.

Through TeleWell, clients could connect remotely with a clinician, recovery coach, or prescriber for varying times and frequencies.

“The response from the community has been positive, with many individuals requesting the ability to continue receiving services utilizing TeleWell in the future,” said Sara Kendall, vice president of Clinical Operations.

“The flexibility of MHA’s TeleWell best matches the ability of individuals to receive services, while also in a location of their choice, in which they are comfortable,” she added, noting that client feedback suggests a growing role for this model in the future. “The adaptive world of today has been a benefit to the critical to needs of tomorrow.”

MHA recently announced $13,333 in grant funding provided by Baystate Noble Hospital to advance Well Aware, an information and education initiative that aims to raise awareness of the availability of telehealth services to help people dealing with the challenges of opioid and substance use disorders in the Greater Westfield area.

“The ability to connect via TeleWell can be of critical importance for people who cannot partake of services in person due to the COVID-19 crisis, a lack of transportation, or concern about the stigma often associated with seeking help,” said Kimberley Lee, vice president of Resource Development and Branding for MHA, adding that TeleWell can be an important bridge to enable people to receive the care they need from the safety of their own homes, and that, for people with opioid and substance-use disorders who either wish to enter into recovery or are already in recovery, being able to keep regular appointments with a counselor is critical for them to achieve success in staying sober.

“This is especially important during the unprecedented COVID-19 pandemic, which has upended our society and created a new normal of social distancing,” said Ron Bryant, president of Baystate Noble Hospital. “This practice has resulted in large numbers of people who feel isolated from their families, their circle of friends, and their normal life’s routine. This in turn can result in anxiety, depression, loneliness, and an overwhelming sense of fear and uncertainty, all of which can be addressed through behavioral-health services.”

It’s not just behavioral-health professionals saying telehealth offers an easier and less anxiety-ridden experience, one that makes it more likely patients will keep their appointments. Cameron reports the same trend at Holyoke Medical Center’s practices.

“One thing we found was our no-show rates dropped dramatically,” he said. “It’s pretty easy for the patient. They’re notified at home, and all they have to do is connect. They don’t have to go anywhere.”

As offices reopened to the public, he continued, “we’re probably a mix now of 60% in office, 40% telemedicine. So it’s shifted a little bit, but our goal is to continue to push it as a tool for the providers because, in certain cases, it’s more efficient and effective. It’s actually quicker for the patient and provider.”

Cameron doesn’t expect demand to be an issue, especially as more patients try out a remote visit, he said, noting that a couple of family members recently scheduled televisits and were surprised how easy and effective a visit could be without having to go to the office.

“There’s a push by the state and the feds to keep this in place as a tool to connect with patients. There’s been a push to extend it, make it permanent as a way to get paid, and at the full rate of an office visit. There are definitely enough patients out there who want this.”

Generation Gap

Viswanathan agrees that patients have adapted to the technology. Even older patients, who might not be comfortable with technology, have responded positively when a family member or visiting nurse has shown them how to access it. “When they see the benefits and ease of using it, their acceptance just shoots up.”

Most physicians like having the option as well, Cameron said, noting its potential in on-call situations, when a doctor can send a patient a link and get connected quickly.

“It’s a great tool that gives us much more flexibility. So I don’t see this going away,” he told BusinessWest.

As COVID-19 cases subside, some practices are going back to seeing most patients in person, he noted, but HMC continues to reinforce the use of telehealth. “This is a tool we want to use for the right visits. We want to make sure we give the option to patients. And, as we beef up the technology around it, docs like it.”

One reason, Viswanathan said, is it opens up a practice’s business to patients who may live farther away than they’d like to drive on a regular basis. He also foresees a day when community centers are equipped with telehealth ‘booths’ where patients can transmit their information and be connected to a doctor.

“It will never replace a visit,” he added, “but I think there’s going to be so much innovation around this.”

Part of Cameron’s job will be to continue to educate providers on how telehealth can be an effective tool.

“We still have older docs not accustomed to using all the technology. Back in ’07, EMR was a challenge. Now we’re asking them to do person-to-person visits via telephone or video,” he said. “So I think we’re still early in the process, but I’ve seen tremendous benefit to this that I don’t think is going to go away. And our plan here is to continue to educate, build the technology around it, and make it easier and more efficient for our providers and the whole system.” u

Joseph Bednar can be reached at [email protected]

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 15: Aug. 3, 2020

George Interviews John Doleva, president and CEO of the Naismith Memorial Basketball Hall of Fame.

George Interviews John Doleva, president and CEO of the Naismith Memorial Basketball Hall of Fame, and Chairman of The Greater Springfield Convention & Visitors Bureau and they discuss how the pandemic has impacted the tourism industry and Springfield’s long-term strategic plan moving forward.

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Coronavirus Special Coverage

Finding Meaning

Kay Simpson

Kay Simpson says the top priority before reopening Springfield Museums was making sure both visitors and staff would be safe.

“Kissing Through a Curtain” is an exhibit of 10 contemporary artists, dealing with communicating and translating across borders, how people interact, and the meaning behind words. It was hung at the Massachusetts Museum of Contemporary Art (MASS MoCA) in March, a few days before the museum closed due to COVID-19 — and there it has hung, dormant, ever since.

“The curator of that exhibit recently changed the introductory text to note that the questions the exhibit asks feel even more urgent now than they did three or four months ago when the exhibit was originally scheduled to open,” said Jodi Joseph, the museum’s director of Communications.

Visitors have agreed, she added, citing a conversation she had with a family of regulars from Boston the week museums were allowed to reopen to the public.

“Heading out, the mom in the group said, ‘oh, gosh, it has so much more meaning now,’” Joseph told BusinessWest. “That’s truly contemporary art. It reflects our time and what we’re going through.”

What museums have been going through is nothing to celebrate. Shutting down for almost four months is a financial strain for any cultural attraction, no matter how large or small.

“For many smaller museums, the financial impact has really been catastrophic,” said Kay Simpson, president of the Springfield Museums, adding that her organization was fortunate to receive not only a Paycheck Protection Program (PPP) loan, but generous contributions from a private donor and a foundation to help get through the past four months.

“One of the things people loved is all the interactive exhibits we provided, both permanent and traveling. Of course, now, we’ve had to be very careful about that.”

“It was an agonizing decision to shut down. At the beginning, we thought it would be for three weeks, and we’d be able to reopen,” she said, adding that conversations with other museums, followed by Gov. Charlie Baker’s shutdown order in late March, made the actual picture much clearer.

“It was really hard. It has just been an experience like no other,” she said. But thanks in part to the PPP loan and those donations, “we were able to sustain our operation through the closure. And now we’re reopening, but it’s on a limited basis. We’re very, very concerned about making sure this is a safe environment for our employees and our volunteers, as well as our visitors.”

It’s important they feel safe and return, Simpson added, if only because of what this set of museums means to the city and region.

“They’re unique and can’t be replicated at other settings — it’s an incredible complex that has served the city of Springfield for more than 160 years and is constantly evolving,” she said. “It attracts people of all ages and all backgrounds, engaging in learning experiences alongside each other — it’s a place where people come together, and it’s joyful and also educational.”

And, at long last, open to visitors.

Safety First

Not that it was easy getting to that point, of course. Museums across Massachusetts had to adhere to very specific guidelines outlined in phase 3 of Baker’s economic reopening plan, as well as their own sense of what visitors needed to feel comfortable enough to return.

Both Simpson and Joseph outlined measures at their facilities ranging from signs reminding people to wear masks, wash their hands, and stay six feet apart to plexiglass barriers and one-way directions at certain areas.

“One of the things people loved is all the interactive exhibits we provided, both permanent and traveling. Of course, now, we’ve had to be very careful about that,” Simpson said, noting that one nod to the new reality is the Yop, a Dr. Seuss character but also a new cell-phone app packed with maps, scavenger hunts, and self-guided tours that lend some interactivity to the museums in a safe way.

“We anticipate families will be among first visitors, and older adults will follow once they feel more comfortable,” she added, noting, of course, that what we know about COVID-19 has evolved, and is no longer recognized as dangerous only to older people.

MASS MoCA

Jodi Joseph says the wide spaces at MASS MoCA make physical distancing easier than at many places where people gather.

“We took COVID-19 very seriously, and we’ve engaged in months of planning,” Simpson said. “Even though we were closed, our staff worked very hard behind the scenes. We had staff talking to other museums, sharing best practices, attending webinars and conference calls, reading CDC guidelines — all to understand how we can safeguard our environment. It’s not like a classroom setting; it’s not like a retail setting — it’s a very different set of physical environments that we needed to think about very carefully.”

In addition to the basic rules around masks and distancing, MASS MoCA visitors who experience fever-like symptoms while at the museum are asked to self-identify to staff, and to enable contact tracing, should that be necessary, all ticket buyers are required to provide contact information and names of everyone in the party — both ways to prevent isolated infections from becoming community problems.

That said, the galleries themselves are massive — “we measure our gallery space by the acre here,” Joseph said — but high-traffic areas like stairwells are now one-directional, the entrance and exit have been separated, and the admissions desk has moved outside, accepting no more than 75 timed tickets every half-hour to keep crowds at state-mandated levels.

The museum, at one point, was considering five different scheduling plans for those galleries, which were gradually whittled down to one plan as the reopening date became more crystallized. Joseph credited state Sen. Adam Hinds and Jonathan Butler, president and CEO of 1Berkshire, for keeping the museum abreast of what was happening at the state level.

“As guidance about the hospitality and tourism sectors started to come down in late spring, we had a pretty good sense of when we’d be open, and we were able to come up with an exhibition calendar that made sense,” she explained.

“We learned lessons from the closure; we came to understand we need this online presence, and it needs to be developed on a parallel track with our on-site experiences.”

Like many museums, MASS MoCA has a long exhibition cycle that’s planned out well in advance, so most installations were ready to go this month. Meanwhile, the museum staged its first concert last week, for an audience limited to 100 — including staff — in a space that can typically pack in 4,000.

For the region’s live-music scene, it’s a welcome start. MASS MoCA alone usually hosts performing-arts events 40 weekends per year, and about half its resources go toward supporting the performing arts, mostly emerging artists.

In short, it’s tough when everything shuts down.

“MASS MoCA is a landlord — we have between 30 and 40 tenants on our 16-acre, 28-building former factory campus,” she noted, and a core group of employees remained on site to manage them, but also reach out virtually with daily ‘art moments’ — “like a greatest hits of MASS MoCA, some fan-favorite exhibitions. We wanted to remind people how great it would feel to be back here, walking these halls, reflecting in the galleries, taking in performances on our stages all across campus.”

It was in many ways “an excruciating few months,” she added, yet the museum staff was inspired at times, too.

“Visitors kept in touch not just with donations, but with deeply felt personal messages telling us how much MASS MoCA means to them, or sharing landmark memories from their own lives that have taken place within these walls,” she told BusinessWest. “As our hearts were aching from being closed and dealing with all the daily troubles of the world, we were also reassured by all the gratitude and appreciation folks were showing the institution, even though we weren’t able to welcome them inside.”

That said, Joseph was thrilled to see more than 1,000 people arrive on opening weekend. “Everyone who showed up said things like ‘thank you, I’m so glad you finally opened’ and ‘I’ve been dying to get back here.’”

Virtual Lessons

Springfield Museums stayed connected to fans as well by bolstering its virtual museum offerings online, Simpson said, from online classes to video demonstrations of collections and exhibitions, to staff videos showing parents how to do activities with their kids at home.

“We learned lessons from the closure; we came to understand we need this online presence, and it needs to be developed on a parallel track with our on-site experiences. So there is innovation that has come out of this,” Simpson said. “Out of something that no one wanted came positive results that can help shape what we do in the future and help us be better.”

That said, she was quick to add that “we strongly believe having people come down to the museums and engage in on-site experiences is really what we do well, and it’s our greatest contribution to our community and people who come to us from all over the region — and across the country and all over the world.”

She’s confident they will come from afar again, though it might take some time. “We might need a vaccine or successful treatments before people feel really confident about being together in the way they were before the pandemic.”

Joseph knows they’ll return, too, whether it’s to see art, like “Kissing Through a Curtain,” that shines a light on today’s world, or, conversely, to get away from reality, especially when that reality has been living in isolation for months on end.

“We want our institution to be a place of respite and a place where people can reflect on their shared experiences — and a place to escape, if that’s what they need. Leave the cares of the world behind and take a moment to be with art. That was our great hope when we reopened the doors.”

Joseph Bednar can be reached at [email protected]

Health Care Special Coverage

Critical Condition

Guy DiStefano

Guy DiStefano says the non-urgent procedures that were shut down in March typically support the rest of what hospitals do, leading to major revenue shortfalls this spring.

Back in March, when COVID-19 was just starting to crest, hospitals took steps to brace for a potential surge of patients. But while COVID-19 surged, revenues slowed to a trickle.

“Early on, we realized we needed to build capacity for a surge of patients so we didn’t get overwhelmed like they did in New York City, so we shut things down early in March — which blew a hole in everybody’s finances,” said Mark Keroack, president and CEO of Baystate Health. “We’ve been gradually returning to prior operations. We always remained open, of course, but it was only a week or two ago that we resumed more elective kinds of cases.”

Many hospitals are doing the same, but the overall losses to the state’s hospital industry are, as Keroack put it, “staggering” — expected to total between $5 billion and $6 billion by the end of the fiscal year on Sept. 30. “It’s a big stress test, if you will, for hospitals. And some have been hit more than others.”

All area hospitals have taken a financial blow.

“This has been very challenging, with the reduction in services,” said Guy DiStefano, vice president of Finance at Mercy Medical Center. “All our outpatient services — what are termed non-urgent cases, which usually help feed and support what a hospital does in its normal, day-to-day business — has been shorted, leaving us with a great revenue shortfall.”

At the same time, he added, “we still have all our expenses in place, just like any other business. Look at restaurants — the doors were closed, but they still had rent, utilities, all the other expenses, and the employees.”

Through May, Mercy saw a $25 million reduction in revenues due to pandemic-related reductions in services — and plummeting volume in the ER, a development that surprised hospital officials nationwide. At Mercy, daily Emergency Department cases dropped from a typical average of between 225 and 250 to around 100 to 120.

“Those slowly crept back up — we’re at 150 to 180 on a daily basis, so we’re not at full capacity, and there’s a lot of pent-up demand. Our business is coming back, but we lost a lot of revenues.”

“All our outpatient services — what are termed non-urgent cases, which usually help feed and support what a hospital does in its normal, day-to-day business — has been shorted, leaving us with a great revenue shortfall.”

Joanne Marqusee, president and CEO of Cooley Dickinson Hospital, said the hit has been significant. Through May, the facility recorded a loss of $18 million, partly due to COVID-related costs, but mostly because of lost volume. That number would be worse if not for $5.5 million in federal support.

“But that in no way covers our losses,” she added, noting that Cooley Dickinson Health Care could see a revenue shortfall of well above $30 million for the fiscal year ending on Sept. 30.

“We’re now planning for a fiscal-year 2021 budget and considering a number of measures to mitigate some of this — things like hiring freezes and reducing a lot of discretionary expenses. Everywhere we can hold off on spending, we have,” she went on, noting that service hours could be temporarily curtailed in some services, while employees making more than $26.50 per hour will forgo raises for the time being.

While that move shaves some costs while protecting lower-paid employees, it doesn’t make nearly enough of a dent, Marqusee noted. “So we’re looking at ways to further reduce expenses. But the work we’re doing already will certainly have an impact.”

DiStefano said Mercy has also had to take steps like furloughs and reducing hours to mitigate the losses. “We did everything we could to help employees keep their benefits in place. But employees are the number-one cost of a typical hospital — about 50% to 60% of the cost structure.”

Holyoke Medical Center has been losing roughly $6.5 million per month since services were curtailed back in March, President and CEO Spiros Hatiras said. But the community hospital did take some steps early on to gird against the damage.

“We were probably the first hospital in the area to furlough folks; we didn’t hold off because we saw it was absolutely important to be financially viable because we don’t have a parent company to spot us money,” he told BusinessWest, adding that many furloughed employees took advantage of the $600 federal boost in unemployment and wound up bringing in more than they did while working.

Joanne Marqusee says she hopes patient volume returns

Joanne Marqusee says she hopes patient volume returns not because of the revenue issue, but because patients shouldn’t forgo necessary care.

“That helped reduce expenses significantly,” he added, noting that almost 170 of 250 furloughed employees were back at the start of July, with another 80 to 90 expecting to return at month’s end. “Then MassHealth stepped in and allocated $11.8 million over four months to cover some of the losses, and we got a one-time payment from the feds of about $3 million. Add it all up, and through May, our losses were roughly $3 million — not insignificant, but we were able to survive it.”

Dollars and Sense

Baystate is surviving, too, Keroack said, emphasizing the importance the health system has not only on its 12,000 employees, but on the region, where it has an annual economic impact of some $4.2 billion.

When the fiscal year ends on Sept. 30, he expects Baystate to have lost about $160 million in revenues due to volume losses, but the system was able to secure about $75 million in federal relief and another $23 million state aid.

“The rest of that will likely be covered by reserves,” he added, noting that Baystate is fortunate to have both reserve funds and a broad service model.

“The smaller hospitals that have cash-flow problems got hit very hard because they didn’t have much in the way of reserves, but the other group is bigger hospitals that are highly specialized, like Mass General, where their revenues really depend on that elective surgical volume. Hospitals that are jacks of all trades and have good size, like Baystate, were hit less hard. Not to say it was pleasant what we’ve been through.”

Calling a $160 million revenue loss a ‘less hard’ hit may speak in some ways to the financial clout of the healthcare industry as a whole; it’s certainly one of the Commonwealth’s key economic drivers. And as patient volume continues to ramp back up, hospitals will be on safer ground when it comes to budgeting.

“At Baystate Medical Center, we’re at 80% to 90% capacity, so I would say people are mostly back.” Keroack said, noting that, while patients are returning gradually for routine care and procedures, current volume is still affected by social-distancing and sanitization measures that have slowed the pace of treatment. “In the community hospitals, they’re a bit further behind — more like 60% of former volume.

“In the long run, the question is, will volumes be permanently depressed?” he went on. “We’ve tried to convince people you really don’t want to put off stuff you know is worthwhile — you don’t want to ignore symptoms that might be serious. We have seen a number of people lately whose illness is much more serious than it would have been in pre-COVID days.”

Cooley Dickinson Hospital’s Emergency Department has seen a 100% increase from its COVID lows, during the height of the pandemic locally, when it was handling 35 to 45 patients per day. Now, ED providers are seeing 70 to 80 patients per day, which is still about 20% below the organization’s typical ED volume.

“We are seeing people with chronic illness who have waited too long to seek medical attention and are sick,” Emergency Department Nurse Director Sara McKeown said. “We have also seen an uptick in people seeking mental healthcare; patients presenting with substance-use issues and trauma are also increasing.”

Patient volume is bouncing back at Holyoke Medical Center and its community-based practices, but ED visits still lag, Hatiras said. “Anecdotally, we’ve heard of people putting off heart conditions and other things, and that can lead to bad outcomes. People shouldn’t stay home with serious conditions.”

That said, “I don’t blame the government for being overly cautious with closing down elective surgeries,” he added, noting that the elimination of many procedures over the past two months was, more than anything else, about preserving beds to treat an unpredictable pandemic.

“We’re now planning for a fiscal-year 2021 budget and considering a number of measures to mitigate some of this — things like hiring freezes and reducing a lot of discretionary expenses. Everywhere we can hold off on spending, we have.”

Now that the infection rate is being effectively controlled, he explained, hospitals are trying to communicate the message that they are safe places to visit — with plenty of strict protocols in place, from masking to social distancing to constant sanitizing — for patients who need to be seen.

DiStefano said the challenge has been ramping services back up — and bringing back furloughed workers — to match what is proving to be pent-up demand, but in a measured way. “It’s a delicate balance — how do we do this to best serve the community?”

It’s a long road back from the volume lows of the spring, when physician revenue dropped by 50. They’re now back around 65%, and inpatient beds are at about 80% of capacity. But people with serious health concerns should not put off care, he stressed, especially since the hospital has been diligent about infection protocols and keeping COVID-suspected patients separated from the rest.

“We take great pains to keep this environment safe,” he said. “The message to the community is, ‘if you are hurt, if you have a condition, this is a safe place to come.’” It helps, he added, to be affiliated with a larger system, Trinity Health, and while Mercy has rarely seen the kind of financial deficit it faced this spring, its leaders are still doing what they can to meet community health needs.

“We are the fabric of the community; there are no concerns about Mercy’s future,” DiStefano told BusinessWest. “We are going to be here for many years to come. Fortunately, we have the backing of a larger organization, and that helps a lot.”

Distance Learning

If there is an upside to navigating the pandemic, he said it might be the growing importance of telehealth, which became not just a convenient tool for providers and patients over the past few months, but a critical one — and one that seems to be on track to be covered by insurance payers in the future much more consistently than before.

“This has become more of a platform that allows us to reach out to patients,” said DiStefano, whose background in telemedicine goes back to the 1990s. “I hope it’s a bigger part of healthcare going forward. Obviously, you have to do some testing in the office, but you can do preliminary or follow-up appointments with telehealth, and that reduces the volume of patients in the waiting room and the physical office, which allows us to have a much cleaner, COVID-free environment to keep those people safe.”

In short, it’s a way to boost volume — and revenues — while making patients who do go to the hospital feel more secure.

Hatiras agreed. “We had to switch on the fly to do more telehealth, but what we saw was care being delivered even more efficiently,” he said. “We saw no-show rates completely drop. So it’s an effective way to provide care, and there will certainly be more pressure on insurers to reimburse appropriately for telehealth.”

Indeed, Marqusee added, “what has been stopping us from doing more telehealth has been reimbursement; I hope we never go back to the days when we were so underpaid for telehealth. It has been a terrific model.”

In the meantime, she sees volume slowly returning to Cooley Dickinson — perhaps reaching 90% of a typical season come October. “But the reason we welcome those numbers is because people need to get care — it’s not because we need the volume. We know from national studies and anecdotally that people have been afraid, and they’re forgoing care, and that can really have health impacts for people.”

That’s why her facility, like the others BusinessWest spoke with, is not only maintaining strict protocols around infection control, but is communicating what it’s doing with the community.

“People have to believe that and feel confident. It’s really important that people don’t stay home in pain with issues that will just get worse. People aren’t coming with heart attacks, or appendicitis, or they power through a head injury, and it turns out they had a brain bleed. People need to come for care, and they should know this is a place they can come and feel comfortable.”

Not so comfortable, however, that they neglect the behaviors that have reduced infection rates in Western Mass. and allowed hospitals to increase their non-COVID-19 services.

“We’re in a good place; there isn’t a high level of COVID in our community. But that can change quickly,” Marqusee said. “I want people to always remember the reason we have low levels of COVID is because of the efforts everyone is making to social distance, wear masks, and practice hand hygiene. We shouldn’t take the reopening as a sign they we don’t need to do those things, but to do it even more. That allows us to provide needed care to all our communities.”

Keroack says he expects some patients to enthusiastically return to care providers, while others will be stragglers who need more convincing — while others will continue to embrace telehealth as the best option.

“We may not return to our former volumes until we have a vaccine and everyone feels totally comfortable,” he told BusinessWest. “I think it’s going to be a process.”

Joseph Bednar can be reached at [email protected]

Coronavirus Special Coverage

Solid Proof

Mike Quinlan

Mike Quinlan says the pandemic has ratcheted up online orders and curbside pickup, while generating an increase in overall consumption of alcohol.

Some are calling it the ‘drinking at home’ phenomenon — a reference to how people who can’t go to bars, nightclubs, or (until recently) casinos have been doing all or most of their imbibing at their residence instead.

Others are calling it the ‘drinking while working at home’ phenomenon, and that’s another story, one that has a number of employers understandably concerned.

Whatever it’s called, it’s a fact that people are not going out to drink nearly as much as they did BC — before COVID. And they’re drinking more, by most all accounts — according to a Morning Consult poll of 2,200 U.S. adults conducted in the spring, 16% of all adults said they were drinking more during the pandemic, with higher rates among younger adults — and for reasons ranging from coping with all the additional stress from the pandemic to not being in the office for eight or nine hours a day, to being able to stay up later on ‘school nights’ because they don’t have to dress for or commute to work in the morning.

All this has created opportunities for some area business owners, especially liquor-store owners — always deemed essential by the governor — who have seen sales volumes rise (in some cases dramatically) and a number of trends emerge.

That list includes everything from more bulk purchases to buying less-expensive items to keep overall spending down; from ordering online to getting items delivered or picking them up at curbside.

“April, May, and June were just … crazy,” recalled Sean Barry, owner of Four Seasons Package Store in Hadley. “It was just constant — the phone ringing off the hook some days, and you never knew when your busy days would be.”

Mike Quinlan, fine wines manager at Table & Vine in West Springfield, agreed. He said overall business volume has increased, as have visits to the store, but what has really ratcheted up has been online ordering and curbside pickup. The company has always featured the former — it’s been especially popular with wine buyers — but not the latter until the pandemic created a huge need for it.

“April, May, and June were just … crazy. It was just constant — the phone ringing off the hook some days, and you never knew when your busy days would be.”

“The impact on our business for online orders went up dramatically — it was a huge increase in the number of orders we were getting,” he said last week, noting that, while it has tapered off lately as restaurants have reopened, recent holidays, such as the Fourth of July, saw huge volume, and orders continue to flow in. “There’s a stack of orders for us to pick today, and then we keep up with it throughout the day.”

For others, this trend, which would appear to have some staying power — because, in this state, bars won’t open until there’s a vaccine, and in others where they’ve opened, they’re closing down again — is simply shifting business from one type of client to another.

Indeed, Paul Kozub, founder of Hadley-based V-One Vodka, said that, while his sales to liquor stores are certainly up — 30% to 40% over last year, by his estimation — sales to restaurants and bars are way down. And the scale is not exactly balanced because the latter has traditionally been the source of more business than the former, especially at certain times of the year, like spring, when COVID-19 shut most everything down.

Paul Kozub

Paul Kozub says that, while the pandemic has certainly increased sales of his vodka in liquor stores, that hasn’t made up for the losses he’s incurred at bars, restaurants, and events.

“In March and April, I lost 50% of my business because I do so much in bars and restaurants during those months, while I do a lot more in liquor stores in November in December, so that was quite a shock,” Kozub said. “The package stores are up, but that certainly doesn’t make up for what we’ve lost in those bars and restaurants.”

Overall, as with most sectors of the economy, the pandemic has created some opportunities for those making and selling spirits, and also eliminated others. For this issue, we take a look at how the numbers provide some hard proof — yes, that’s an industry term — of how buying and consumption habits have changed.

Case in Point

Barry, like many liquor-store owners, reduced his hours early in the spring and closed earlier at night. There were many reasons for this, he said, listing fewer people being on the roads, the fact that almost all surrounding stores were closed, and a desire to limit the risk of exposure to customers and employees alike.

But there was also what he called simply the “fatigue factor.”

“My staff was just overworked, so we needed to cut back,” he explained, noting that, while things have settled down somewhat since then, with restaurants now open, many people are still wary about going to such eateries, and in the meantime, large numbers of people continue to entertain and, yes, work from home.

Which means they’re buying more at the liquor stores. And their buying habits are changing in all kinds of ways, said Barry and Quinlan, noting that in-person visits are still popular, but curbside is flourishing as an option, and delivery, offered by some but not all, has certainly gained significant traction as well.

And while business is up generally, there have been periods of especially heavy volume, including some holidays that have historically been dine-out occasions but are now, like most things, stay-at-home affairs.

“When Mother’s Day came, and Father’s Day … those are occasions where a lot of people go out to a brunch or something like that — but not this year,” Quinlan said. “And so we saw our business jump significantly during those weeks when people would be having meals at home instead.”

Barry noted that, while it’s logical to assume that the closing of the five colleges located near his store in the middle of the spring semester would certainly have impacted his bottom line, he said that’s not really the case.

That’s because the vast majority of students are underage, he noted, and also because his store, unlike some in that area, does not directly market to the college crowd.

But the crowd it does cater to is definitely buying more these days, adding that he’s seen several trends develop. One is that many people — meaning those who can — are buying in bulk, on the theory being that, as with trips to the supermarket, many are trying to make as few as possible.

“What’s of note to us is that, in the wine department, the average price of a bottle that we’re selling has gone down a little bit. People who would drink a bottle or two of wine a week were now drinking three or four bottles a week, so they’re spending less on those bottles.”

So they’re coming less often, and they’re also buying in larger quantities, which is better for them than it is for the liquor-store owner.

“Sales are up, customer counts are pretty flat, and overall, net profit is slightly down,” Barry said. “That’s because everyone is buying bulk items and taking advantage of case discounts and all that stuff.”

Quinlan concurred, to a point. He noted that, while buying the large, economy sizes, or full cases of products, is less profitable for the store, Table & Vine — and other stores, he presumes — have been able to sell more in fewer hours, thus yielding greater overall productivity and profitability.

But while consumption of alcohol is increasing — statistics nationally confirm that — overall spending in individual households may not be. People are buying in bulk, as noted, but they’re also buying less-expensive items in some cases.

“What’s of note to us is that, in the wine department, the average price of a bottle that we’re selling has gone down a little bit,” Quinlan said. “People who would drink a bottle or two of wine a week were now drinking three or four bottles a week, so they’re spending less on those bottles; the number of bottles we’re moving has increased significantly.”

Mixed Results

As for what people are buying … it’s generally across the board, said Barry, noting that wine and vodka probably represent the biggest increases.

Speaking of vodka, Kozub, while referencing the shifts in consumption and buying and some changes at his company as it expands nationally, said the pandemic has certainly helped his business in some ways — but definitely hurt it in others.

Indeed, while he’s done much better with liquor-store sales — in large part because the company is now working with a distributor, which has opened a number of new doors — he’s suffered greatly from not having bars, restaurants, and other gathering spots — from the Hadley American Legion to the South Deerfield Polish Club; from MGM Springfield to the Big E — open for business.

And there are other missed opportunities as well.

“We were going to be the official vodka of the Pro Football Hall of Fame,” said Kozub, noting the company’s current push into Ohio, where that shrine is located (in Canton). “And we were going to sell a lot at the induction ceremony and Hall of Fame Game, but that just got called off.”

As for his liquor-store business, he’s been helped by the work-from-home and stay-at-home trends, and also by ‘Zoom mixology’ sessions, as he called them, Zoom happy hours, and other vehicles to educate the public, bring them together (online, at least), and share experiences somewhat like being in their favorite bar.

Meanwhile, as noted, the distributor he’s hired has certainly reduced the profitability of each bottle he sells in his liquor store, but it has greatly increased volume.

“Without the change to a distributor, we would be down 40% overall for the year,” Kozub said, emphasizing, again, just how much he’s lost through restrictions on people gathering in large numbers or confined spaces.

And this ongoing trend — and even taking steps backward in some states, including Florida, Texas, and others — is slowing V-One’s efforts to go national.

“We’re going to do Ohio and Michigan next, but we’re going to wait a little bit for Florida, Texas, and California,” he said, adding that those states, among the current hot spots, are closing many of the bars and restaurants that were open just a few weeks ago. “The timing of us going national is good in some ways, but tough in others.”

Meanwhile, in the current climate, getting into new liquor stores and expanding that footprint, which is among Kozub’s many goals, is somewhat of a challenge.

“The liquor stores are so busy that they’re not necessarily excited about bringing in new products right now,” he explained. “Because they’re selling everything they have, they’re selling a lot of the staples — the brands people know.”

Beer with Us

This is yet another emerging trend at a time when there have been many changes when it comes to what people are buying, when, where, how, and in what quantities.

The pandemic has certainly changed the landscape in so many business sectors and aspects of society — and alcohol is just one of them.

For some businesses, this will be a vintage year — another industry term — while for others, like Kozub, it will be a mix of new opportunities and lost opportunities, with the former hopefully outweighing the latter.

And, as with those other sectors, it’s a matter of waiting and seeing what happens.

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

Coronavirus Special Coverage

Coping with a Lost Year

Gene Cassidy

Gene Cassidy says the Eastern States Exposition is much like the farmers it helps promote; one lost season can spell disaster.

As he talked with BusinessWest about the cancellation of this year’s Big E and how the Eastern States Exposition (ESE) will respond to that huge loss of revenue, Gene Cassidy stopped and pointed to a picture at the opposite end of the company’s large conference room.

“That’s J. Loring Brooks, son of Joshua L. Brooks, founder of the Eastern States Exposition,” said Cassidy, president and CEO of ESE. “He was the Big E’s chief development officer. When the Eastern States had rainy fairs or fairs where, for one reason or another, we didn’t make any money, he would get on the phone and fundraise; when we had difficult times, he would find the funding to make ends meet.”

J. Loring Brooks died in 1984, Cassidy went on, and it’s been a long time since the fair has needed to try to raise money in that fashion — and it would be difficult do it that way now. “That’s not an aircraft carrier you can turn on a dime,” he noted, adding quickly that he did hire a development officer last year, and is looking into various strategies to perhaps do some fundraising.

Action of various kinds — from a development campaign to borrowing to discovering new revenue streams — is needed because 2020 has been the rainiest of years — figuratively, if not literally — in the fair’s 102-year history, and the assignment of making ends meet, as he put, is going to be a very stern challenge.

“We’re not unlike the farmer — if he loses a season, he can go broke,” said Cassidy, who quickly went from that analogy to another one. “I cavalierly refer to the Big E as the church bazaar for this nonprofit; if you don’t have your annual fundraiser, how can you execute on your mission?”

The Big E, he noted — originally known as the Eastern States Industrial and Agricultural Exposition — was created to be that church bazaar, the method for raising money needed to support a mission of promoting agriculture.

Thus, the COVID-19 pandemic has done more than close the fair for the first time since World War II. It has put the Eastern States Exposition on precarious financial ground; put plans for rehabbing and modernizing some of the buildings on the grounds, especially the obsolete Coliseum, on ice; left large questions marks about how the ESE is going to respond to the agricultural community’s ongoing need for a platform; and even raised some doubts about the fate of the fair in 2021.

“We’re not unlike the farmer — if he loses a season, he can go broke. I cavalierly refer to the Big E as the church bazaar for this nonprofit; if you don’t have your annual fundraiser, how can you execute on your mission?’”

But while those at the Big E are certainly moving full steam ahead with planning for next year’s fair, they must also contend with a massive hole in the budget — the Big E accounts for 85% of the yearly revenue, and much of the remaining 15% (all the many types of shows on the books after mid-March) has been wiped off the calendar as well.

Grounds for Change

That makes this year decidedly different, said Cassidy, noting that, in a typical year, his staff would be on what amounts to cruise control as it enters the final six or seven weeks of lead-up to the Big E. This year, these employees are searching imaginatively for ways to generate revenue and close the budget gap.

“We’re in a phase now of trying to discover how we can do smaller types of events that can generate some resources in order for us to sustain ourselves through to next season,” he explained, noting that the fair, despite its wealth of space, buildings, parking, and amenities, is still limited in what it can do. Put another way, it’s limited by what it can’t do, according the governor’s reopening plan — bring large numbers of people together in close proximity to one another.

J. Loring Brooks

When he was the Big E’s chief development officer, J. Loring Brooks would get on the phone and raise money when the fair had bad years, usually as a result of weather.

Options, most of which involve keeping visitors in their cars and taking full advantage of the Big E’s sprawling, 59-acre main parking lot, include everything from a drive-in theater — a cost-benefit analysis is currently underway — to concerts to events like the recent ‘Taste of the Big E,’ a gathering that was eye-opening in a number of ways.
Indeed, the Taste, which involved visitors driving onto the Big E property and then staying in their cars to sample some of the food that would have been offered at this year’s fair, drew far more people than organizers were expecting, said Cassidy, adding that traffic was backed up the full length of Memorial Avenue. “People drove for hours to get here, and then they spent hours waiting in line to get in.”

Ultimately, the Taste helped convince Big E organizers that they simply couldn’t control the turnout for this year’s fair, said Cassidy, adding that the event showed that, if you open for the doors for something people want, they will come.

“When we saw the response to the food show, we knew there was no way to control the number of people on the fairgrounds for the Big E,” he explained. “And knowing that really helped make the decision that staging the fair would not in the best interests of the people who came.”

But the Taste also provided ample evidence that different types of revenue-generating events can possibly be staged at the fairgrounds during the pandemic. These won’t generate anything approaching the income the fair did, but they may help limit the flow of red ink in a year no one could have comprehended just five months ago.

“We’re in a phase now of trying to discover how we can do smaller types of events that can generate some resources in order for us to sustain ourselves through to next season.”

A drive-in theater is among them, said Cassidy, noting that, decades ago, there was one just a half-mile or so down Memorial Avenue, and other one on Riverdale Street. Drive-ins have staged something approaching a comeback during the pandemic, but the startup costs are considerable — $90,000 to buy the camera to project the movies, for example.

“We’ve done a lot of due diligence to discover if there’s a way we could actually turn a profit,” he noted. “That’s one of many things that are on the table.”

Another is the possibility of bringing carnival rides — which are not discussed anywhere in the reopening plan, according to Cassidy — to the fairgrounds. Others include finding new uses for the state buildings (or the grounds outside them), and staging concerts where attendees stay in their cars.

“There are some challenges to putting these on, and some limitations, but they’re a viable option for us,” he noted. “People want to get out to events like this, and a lot of entertainers are dying to work; they’ve lost a lot of opportunities, and they need to work.”

Daunting Challenge

While optimistic that some revenue streams can be created in the midst of the pandemic, Cassidy is also realistic and knows that, collectively, these efforts will generate only a fraction of what a solid Big E would.

“My goal is to get this organization through this very difficult time and run a Big E in 2021 that brings people together again,” said Cassidy, adding, again, that this will be a stern challenge not unlike that faced by a farmer who loses a year’s worth of crops.

Or a small fundraiser that loses its annual bazaar.

Those analogies might not seem appropriate for an organization, and an event, that brings 1.5 million people to the region every year. But for Cassidy, they work, and they illustrate just what he and his staff are up against.

—George O’Brien

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 11: July 20, 2020

George Interviews Springfield Mayor Domenic Sarno

George interviews Springfield Mayor Domenic Sarno and they discuss how the City of Springfield is coping with the pandemic as it relates to its residents, businesses, school system, and its senior and homeless population, and how the city will regain its momentum.

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Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, Business Talk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 10: July 15, 2020

Thom Fox interviews Westfield Starfires Co-Founder/Owner Christopher Thompson

Thom Fox interviews Westfield Starfires Co-Founder/Owner Christopher Thompson. Thom and Chris discuss the impact COVID-19 has had on the 2020 Futures Collegiate Baseball League, fan safety measures for home games, and how Westfield is ready to ‘play ball’!

Sponsored by:

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Sections Special Coverage

Reopen for Business

Cindy Olivio recalls the day in mid-March she and her colleagues left MGM Springfield after the governor announced that the state’s casinos would have to close as part of a general shutdown of non-essential businesses. At the time, she really thought it would be for just two weeks.

“That’s how people were talking — that’s what we all thought,” she recalled, noting that, by April, she was taking things week to week. And when the governor’s phased reopening plan was finally announced in mid-May, she fully understood that it would be early summer at the earliest before she was back at the casino — specifically, its South End Market, which she serves as assistant general manager.

“It was a long time to be out, and it’s good to be back,” she told BusinessWest Monday, as the casino reopened to the general public following a soft opening a few nights earlier.

With that, she spoke for most everyone on the floor that day, guests and employees alike.

It was a long time to be out, and while the casino looks very much the same as it did when it went dark back in March, there have been a number of significant changes, from plexiglass partitions on some of the games to signs on the floors and walls alerting people to stay six feet apart.

And they were on full display Monday as the media was given the opportunity to talk with some employees, and also some guests.

People like Darlene Lajeuneffe of Chicopee, who was there with her husband and other family members celebrating the couple’s 46th wedding anniversary. She was marking the occasion with a glass of champagne and some time on one her favorite slot machines.

“It was hard — we love it here,” she said of the nearly four-month shutdown of MGM Springfield, which she frequents maybe once a month, along with Mohegan Sun; she’s never been fond of Foxwoods. She told BusinessWest she was getting used to some of the new rules and protocols, especially distancing guidelines that generally prohibit people from sitting next to one another, which presented a dilemma.

Indeed, Lajeuneffe learned there was an area where family members could in fact sit together, but it did not include her favorite slot machine. So, faced with a choice, she was leaning strongly toward that machine and keeping family as least close by.

Such adjustments are part of the reopening, said Seth Stratton, MGM Springfield’s vice president and general counsel, who told BusinessWest on Monday that, so far, guests are noting the new rules, and adhering to them.

“We’re pleased with how willing customers are to understand and comply with the new measures,” he said. “There was some concern initially around the enforcement of mandatory facemasks when the discussion first came up several weeks ago. But things have evolved since, and customers are very willing to wear them. We’ve had virtually no enforcement issues with mask wearing.”

Stratton told BusinessWest that the company’s management team put a thoughtful plan in place for the reopening. First, there would be a soft opening, the weekend of July 11 and 12, to help ready staff for the full reopening on the 13th. And by staging that reopening on a Monday, this gave the staff several days to ramp up for the weekend, which has historically been the casino’s busiest time.

“The strategy we followed was to have a staggered opening so that, over the weekend, which might otherwise be a busy period, we had our invited guests so we could ramp up from Friday through Sunday, gradually increasing the capacity, and then open to the public on a Monday,” he explained. “That gave us the ability to stagger the opening and get folks back and employees back and get them comfortable in the new environment so that, by Friday or Saturday, our busiest period, everyone will have a week under their belt of the new policies and procedures.”

The casino reopened at one-third capacity, one of the stipulations set by the Masachusetts Gaming Commission, and while that number is limiting in many respects when it comes to revenue, it will help ensure the safety of guests and employees, which is the top priority at the moment, Stratton explained.

“It’s all about showing we can do this safely and responsibly,” he said. “We don’t want huge crowds right now; as we ramp up and as we get these protocols into place, we feel that, if the customers see it’s not that crowded, they will feel more comfortable and be more willing to return.”

—George O’Brien

Coronavirus Sections Special Coverage

Improved State

By George O’Brien

In many respects, Dr. Andrew Artenstein says, the COVID-19 virus acts like water in the home in that, if there are leaks, it can go where you don’t necessarily want it to go and cause major problems.

Dr. Andrew Artenstein

Dr. Andrew Artenstein

“Water will always find a path,” Artenstein, chief physician executive and chief academic officer at Baystate Health, told BusinessWest. “But if you block off all the paths, you have a chance; it’s the same with the virus.”

With that, he worked to explain why it is that Massachusetts, more than most of the other 50 states at this particular moment in time, is seeing the number of hospitalizations and deaths stemming from the virus decline sharply. In short, and in his view, the residents of the Commonwealth are essentially, and somewhat effectively, blocking off the paths the virus might take.

“We live in a society where there’s free mobility — that’s one of the things we love about our society. But it’s also one of the things that puts us at risk when there’s a transmissible agent rooted in this society,” he explained. “And this one is clearly here; it’s clearly transmitted in our community. It has not gone away; it’s just that, if viruses don’t get transmitted from person to person … if the virus has nowhere to go, it puts a wall from that root of transmission. You start to block off transmission paths.”

This was Artenstein’s way of explaining why, as one looks at a map of the country charting cases, hospitalizations, and deaths from the pandemic, Massachusetts is colored or tan or pink, while so many other states, especially in the South and Southwest, are dark shades of red, indicating they are hot spots.

Dr. Robert Roose

Robert Roose, chief medical officer at Mercy Medical Center, gave essentially the same account.

“Massachusetts, along with a few of the other states here in New England, like Connecticut, New Hampshire, and a few others, seem to be solid, if nt shining, examples of how a state encompassing multiple different communities can effectively slow down the rate of transmission of the coronavirus,” he said. “More than 40 other states are seeing significant increases in numbers of new infections, while here, over the past several weeks, we have not seen that increase; rather, we’ve seen a plateauing at a very low level.”

He punctuated those comments with some statistics from his facility. Indeed, he noted that hospitalizations stemming from COVID-19, which numbered in the 50s daily on average in April, the height of the surge in this region, were down in the 20s in May, then the single digits in June. Starting in early July, there were several days when there were no hospitalizations.

Clearly, the state is doing something right, or several things right, when it comes to blocking paths for the virus, and we’ll get to those. But this begs a number of questions — especially, ‘is this sustainable?’

The quick answer, said Roose and Artenstein, is ‘yes.’ But there are a number of caveats, especially as more segments of the economy reopen in more cities, including Boston, and as the new school year is poised to begin. In their view, the Commonwealth has acted prudently in not opening too much of the economy too quickly. Staying that course is essential, they said, adding that it appears the state is committed to the slow, steady, and safe method.

Meanwhile, travel is another key factor in this equation, both people from this state traveling to others and people from other states coming here — actions that create paths for the virus, rather than block them.

“Massachusetts and other states now doing well have been cautious in giving guidance to residents about limitations on travel and quarantining of individuals who have come from other states where there are increasing numbers of infections,” Roose said. “To me, that is likely to be the most significant factor going forward, because of the rates of infection in other parts of the country; interstate travel represents one of our most significant risks in terms of keeping our rates of transmission is this local community low.”

But the biggest factor might be fatigue.

“It’s exhausting — for all of us; I’m not just talking about the healthcare side, I’m talking about life,” said Artenstein. “There are certain things that you just miss having as social human beings. But the longer you can sort of wait this out and stretch this out, the better off we’ll be.”

In other words, people can’t relax or think for a moment that maybe it’s time to start talking about the pandemic in the past tense.

As they talked about the state’s current status as a … let’s call it a cold spot for the virus, both Roose and Artenstein praised the Commonwealth’s approach to reopening, which has been described by both those supporting and criticizing it as slow and careful.

Pain Threshold

Artenstein had another word for it.

“It’s painful, because we all want to get back to a sense of normalcy,” he explained. “It’s exhausting that you can’t do what you like to do the way you used to do it, and eventually we will be able to. But this approach has paid dividends; you get used to a little bit of a new normal, but you also know that you’re moving toward something.”

Roose agreed.

“What I think Gov. Baker and the Executive Office of Health and Human Services have done very well is be cautious, rely very clearly and directly on the key data points, and move slowly but consistently through a phased reopening,” he explained. “In other states, governors had moved much more quickly, and we’re seeing the effects of that now; in many states, they’re seeing such significant increases that they’re moving backward and rolling back some aspects of their reopenings.

“It’s not to say that this same type of thing couldn’t happen here,” he added quickly. “But relying consistently on key data and reinforcing consistently the important public-health and safety strategies that we know are effective in reducing transmission — that has not wavered, and I think that has sent a very consistent and strong message to residents to continue to wear masks, be cautious with increasing your social circle, practice hand hygiene, and quarantine when you’re sick.”

As a result of the slow reopening plan and diligence with things like mask wearing, contact tracing, social distancing, and testing, the Commonwealth has effectively moved past the first wave of the pandemic — while other states have clearly not, said those we spoke with. It is now in what Artenstein called a “window,” where, he said, residents must be diligent about not backsliding when it comes to mask wearing, hand washing, keeping one’s distance, and other preventive measures, while also preparing for the second wave that most say is almost certain to come in the fall or winter.

“That’s just historically what pandemics do,” he explained. “They don’t all do that, but statistics will tell you that there will be at least a second wave if not more waves.”

What will those waves be like? It’s difficult to say at this point, said Roose and Artenstein, adding that a number of factors will dictate the level of infections and how well the healthcare community can respond to the next surge.

But in the meantime, and while still in this window, the state’s residents and business owners alike must continue to stay the course, the experts said.

“We still could do better in terms of how often people wear masks in pubic and follow the public-health recommendations,” said Roose, adding that state leadership must continue to reinforce those messages. “We know that when we give those recommendations and that guidance and it’s clear and connected to science, it helps, and it’s certainly important to be consistent about it, or people will have less inclination to follow them.”

Meanwhile, as the state proceeds with phase 3 of its reopening plan and eyes phase 4, testing will be another critical key to closing off paths the virus might take.

“I believe strongly that adequate capacity and widespread testing are critical for us to continue to move forward into phase 4 and into a state where the community is engaging as fully as it can,” Roose said. “That allows us to ensure that, if we do identify infections, we can mitigate the spread; widespread testing is really critical, and we’re not yet where we need to be, as state and as a country. We still could be doing more, and I think the ways we do testing will continue to get easier and more readily available, and that will help quite a bit.”

Artenstein agreed, but quickly noted that all the steps people have been taking — and hopefully will continue to take — only serve to slow or inhibit the spread of the virus. The virus is still there, and it will remain there until a vaccine is developed.

“You can temporarily shut down or limit transmission,” he said, “and then you have the chance for other things to kick in, such as therapies and better approaches to diagnosis and treatment. Those things take time, but they can get a chance to take root once you’ve already established those public-health principles.

“It’s pretty obvious that limiting public gatherings and staying the course has helped,” he went on, returning to the thought that, however painful and exhausting the last few months have been, the strategy moving forward for the state and all its residents has to be to continue to wait it out and, as he said, “stretch it out.”

Bottom Line

Turning the clock back 100 years, to the so-called Spanish flu, Artenstein said the second wave of that pandemic was more severe than the first in many parts of the country simply because communities eased off on restrictions and returned to what life was like before it struck.

“A lot has changed in 100 years — science, technology, people, etc.,” he told BusinessWest. “But one thing that hasn’t changed that much, in my opinion, is behavior. We may be able to further mitigate any future surge, just as we mitigated this surge, by adhering to public-health guidelines. If we can keep that up, and then get some help with testing, better contract tracing, better therapies, which will happen, and maybe a vaccine…”

He didn’t completely finish the thought and instead stressed that this ‘if’ is a very large one, and there are really no certainties when it comes to this strategy.

But the very best strategy at the moment, he stressed, is to string this out and close off those pathways the virus can take.

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

Sections Special Coverage

If you read between the lines when scanning or listening to the comments made by MGM Springfield officials in the run-up to the reopening of the facility today, it’s easy to see they have some real concerns about whether the restrictions they’ve been placed under will enable them to succeed.

“We’re excited to be here in this moment,” Chris Kelley, president and chief operating officer, told members of the press being given a tour of the pandemic-adjusted facilities last week. “We have significant occupancy constraints that the business will be opening with, but we approach this moment with gratitude for the opportunity to serve our guests and this community again.”

We’re not sure how much gratitude, but we are sure these occupancy constraints and other restrictions, put in place to keep guests and employees safe, are going to present stern challenges for the casino operators.

Roughly two-thirds of the slot machines will be disabled in the name of social distancing; many table games, including roulette, craps, and poker, will be shut down; capacity in the restaurants will also be limited, again in a nod to social distancing; the bars will be closed, and drinking will be limited to those playing the games that are still open; and large gatherings, such as concerts and shows, are still prohibited.

Add it all up, and then add in the cost of retrofitting the casino for play in the middle of a pandemic, and it’s fair to wonder whether opening is even a sound business decision given the high overhead at such facilities. That question remains to be answered.

What isn’t in doubt, though, is whether the city and the region need this facility open for business. To that question, we give a resounding ‘yes.’

Indeed, the tourism industry has been absolutely battered by the pandemic, perhaps harder than any other sector. Hotels, restaurants, bus companies, tourist attractions, and other businesses have been crippled by this. And the announcement that there will be no Big E this fall dealt that sector another huge blow.

We’re not sure how much reopening MGM Springfield will help those businesses — many visitors to the casino don’t make any other stops before or after they do their gambling — but any help would certainly be appreciated.

There’s also the support the casino provides to other businesses, especially its vendors. We’ve written much over the past few years about how important MGM’s business is to these vendors — from the sign makers to the dry cleaners — and the trickle-down, while limited in some respects, is very real.

Then there’s the psychological factor. Much of Main Street in Springfield was shut down by the pandemic, from shops to restaurants to businesses in the office towers. It’s starting to come back somewhat, with outdoor restaurants on Fort Street, Worthington Street, and around One Financial Plaza, and the office towers slowly (as in slowly) but surely coming back to life.

MGM is another, very important piece of the puzzle. With the casino again welcoming guests, Springfield, and the region, will seem all the more open for business after a dreadful spring.

We’re under no delusions here. Reopening MGM is not going to dramatically alter the fate of many of the businesses that have been decimated by the pandemic. But it might provide a spark — another spark, to be more precise — as the region tries to fight its way out of a disaster unlike anything it’s ever seen.

MGM’s managers are certainly not thrilled with the hand they’ve been dealt, as they say in this business, but perhaps they can do something with it — show they can operate safely while eventually building their capacity back up. In the meantime, the city and the region get another boost when they so badly need one.

Business Talk Podcast Special Coverage

We are excited to announce that BusinessWest, in partnership with Living Local, has launched a new podcast series, BusinessTalk. Each episode will feature in-depth interviews and discussions with local industry leaders, providing thoughtful perspectives on the Western Massachuetts economy and the many business ventures that keep it running during these challenging times

Episode 9: July 13, 2020

George Interviews Peter Rosskothen, Owner of The Log Cabin, Delaney House, D. Hotel & Suites and Delaney’s Market

George O’Brien interviews serial entrepreneur, Peter Rosskothen, Owner of The Log Cabin, Delanry House, D. Hotel Suites & Spa, and Delaney’s Market. George and Peter discuss the effects the pandemic has had on a local business owner in an industry focused on bringing people together, and how the current situation has compelled the companies to be more hands-on in their approach and think outside the “event” box. 

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