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AIM’s Leader Says the Commonwealth Is at an Inflection Point

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Features Special Coverage

The State of the Bay State

 

Brooke Thomson said her story is of the kind the Bay State and its leaders like to write.

Hailing from the Midwest, she graduated from Mount Holyoke College, went to law school in Boston, and then made the decision to start her career and raise a family here.

It wasn’t easy, she recalled, noting that she needed roommates when she got her first apartment, and housing in the Boston area, as well as countless other expenses, made those early years — and even the later ones — a stern challenge.

But she stayed and is now president and CEO of Associated Industries of Massachusetts (AIM), a position from which she reflects on, and often retells, her story while noting, with large doses of frustration and even dismay, that it is becoming a harder story to write today.

Indeed, some of the thousands who graduate from Bay State colleges and universities each year are opting not to start their careers here, said Thomson, who sat down recently with BusinessWest to discuss the state of the Bay State. And some who did start here are finding it too difficult to stay amid sky-high prices for everything from homes to daycare and tax burdens that are far less friendly than many other states, including several in the Northeast.

This exodus, if you will, is one of many forces, most of them interconnected in some ways, that are colliding at what is an inflection point for the state, said Thomson, a critical time in its history, when the dust has largely settled from COVID and its aftermath, and this state, like all others, must devise a business plan, if you will, for coping with a new set of realities.

“Businesses, municipal leaders, state leaders, and federal leaders must make sure we’re putting in place the economic incentives and the regulatory pathways so that we can continue to have a strong economy in Massachusetts.”

These forces include the momentous shift in how and where people work post-pandemic, a swing toward remote work and hybrid schedules that is impacting everything from commercial real estate to hospitality and service businesses in central business districts in cities from Boston to Springfield and everywhere in between. They also include demographics — everything from smaller high-school graduating classes to huge numbers of retiring Baby Boomers — a persisting workforce crisis impacting most all sectors of the economy, falling state tax revenues, transportation issues led by the famously unreliable MBTA, a housing crisis that is impacting most of the 351 cities and towns in the Commonwealth, high energy costs and the growing need to address climate change, and, of course, the spiraling cost of living, punctuated by sky-high home prices, not just in Boston, but in an ever-wider radius around the city and many other parts of the state as well.

A poignant example of how many of these forces are intertwined came late last month, when Boston Mayor Michelle Wu proposed legislation to increase commercial property tax rates amid a decline in property values post-pandemic — and as many buildings suffer from remote-work-related issues — in an effort to protect residents from what she called “sudden and dramatic tax increases.”

The matter went to a subcommittee last week, where its fate is in question, especially in an election year, and amid warnings from real-estate trade groups and business leaders that the move would increase the burden on an already-struggling office market and could deter new investment.

Brooke Thomson

Brooke Thomson says housing — and the need to build more of it — is among the many challenges confronting the Bay State at this critical time.

Wu’s proposal, and the reaction to it, are examples of how complicated these problems are — neither side is really in a position to absorb a higher tax burden — and how elected leaders, the business community, and even residents are going to have to work collaboratively in this time of stern challenges, Thomson noted, adding that the state’s businesses, despite some rumors to the contrary, cannot shoulder the burden itself.

“I think this is a critical time because there is so much uncertainty and because we are coming out of the COVID bubble,” said Thomson, who took the helm at AIM at the start of this year. “Businesses, municipal leaders, state leaders, and federal leaders must make sure we’re putting in place the economic incentives and the regulatory pathways so that we can continue to have a strong economy in Massachusetts.

“I think we’ve seen elsewhere in the country that, depending on what actions are taken, certain cities that used to be centers of business and growth are no longer there,” she went on. “Part of this was out of our control, part of it was this COVID bubble where everything was shut down and then people re-evaluated how they worked and where they worked, and businesses re-evaluated where they located and what their space looks like and where they draw talent from. But as we are moving out of that, we must collectively figure out the right sauce, the right recipe, sort of speak, for success.”

For this issue, BusinessWest talked with Thomson about this recipe and the ingredients that might go into it.

 

Work in Progress

Thomson said she can usually tell what day it is — or isn’t — by the volume of traffic in and around Boston.

While it’s still difficult to get where one wants to go most of the time, Mondays and Fridays are at least somewhat better, she said, adding that, by and large, these are the days when many who can and do work a hybrid schedule are not in the office. And the impact of that many people working from their home offices or dining-room tables is felt not just on the roads, but in the office towers in that city, where valuations are falling, and the countless diners, restaurants, and service businesses that rely on foot traffic from people working in the city.

“Tuesday, Wednesday, and Thursday — that’s when people are coming in,” she said. “And that presents a whole host of challenges; it exacerbates transit, and if you have a workforce, like ours, that’s in this sandwich generation where they’re caring for children but also caring for parents, not only do we not have enough support there, but our systems are not set up where daycare facilities have a Tuesday-Wednesday-Thursday schedule.”

“There are a lot of things we have to move on quickly, meaning right now, to set ourselves up to be in a place of continued growth so that, 10 years from now, some of these trends that we’ve seen, like outmigration and tax-return dips, don’t continue. But it’s going to require some strong action right now.”

While Boston is the poster child for the challenges that have come post-pandemic, the same issues are being seen in communities across the state and in businesses of all sizes and in most every sector.

Indeed, she said AIM, which employs more than 25 people full-time, exemplifies the current colliding forces and trends. It has seen a few of its valued employees leave the agency and the Commonwealth for more affordable states, she said. Meanwhile, it is preparing to move into new quarters and reduce its overall footprint to reflect a need for less space amid more remote work.

“Like a lot of businesses in the wake of COVID, we re-evaluated what our footprint should look like and where we should be,” she said, adding that the agency is slated to move in June into space that is slightly smaller, but also features more “collaborative space,” as she called it, and more gathering and event space amid fewer private offices.

As for losing employees to other states, “we’ve lost two people in the past year who were under 30,” she said. “It’s not because they didn’t love Massachusetts; it’s not because they didn’t love AIM. One moved to Tennessee, and one moved to Texas because those states are more affordable, and they have the prospect of buying a home.”

Extrapolate these recent developments across the state and its business community, and it’s easy to see why this is a critical juncture for the Commonwealth, Thomson said.

She can cite some positives and possible reasons for optimism — everything from the tax cuts Gov. Maura Healey signed into law last fall to projections that falling state tax revenues may pick up in the last few months of the fiscal year; from persistently low unemployment rates to signs on Beacon Hill that leaders there understand what needs to be done.

“I remain cautiously optimistic because many municipal leaders, and our administration, are laser-focused on providing incentives to try to make it very clear to the business community that Massachusetts wants businesses to be here and wants businesses to grow,” she said. “And they recognize that, for there to be good jobs and good quality of life and affordable housing, we have to have a strong economy.

“I haven’t seen that messaging in recent years as strong as I’m hearing it now,” she went on. “The question is … will the actions that go along with that be put into place and be effective? From AIM’s perspective, that’s why we’re working alongside the administration and the Legislature to say, ‘now is the time to act.’”

Elaborating, and citing ways in which in the state and its leaders need to act, she listed the housing bond bill proposed by Healey, as well as the so-called ‘Mass Leads’ legislation, an economic-development bill that contains incentives for businesses.

“We have to look at this because, as we see the demographic shift, as we see folks retiring, we’re going to have a real problem if we’re not saying to those young folks, ‘this is where you want to stay and work and raise a family.’”

“There are a lot of things we have to move on quickly, meaning right now, to set ourselves up to be in a place of continued growth so that, 10 years from now, some of these trends that we’ve seen, like outmigration and tax-return dips, don’t continue,” she went on. “But it’s going to require some strong action right now.”

 

It’s About Time

Thomson kept repeating those words ‘right now’ for emphasis, and they apply to everything from housing to how the state will meet its energy needs in the future as it moves on from nuclear power and some fossil fuels to natural gas and clean-energy sources such as solar, wind, and hydro, for which infrastructures must be built.

“If it’s not done quickly, 10 years from now, 15 years from now, I don’t think we’re going to be at a point where we have as much control over turning the ship around,” she told BusinessWest, adding, again, that the responsibility for turning the ship, and the costs involved, must be borne by all constituencies, and not simply the business community.

“We have to be thoughtful and intentional about how everyone has a role,” she went on. “What AIM has said consistently is that this cannot be a burden that is carried by the business community alone. We know that our businesses are really taxed right now; they’re at a point where many of them are just barely getting by, and they’re in a real competition for talent and resources.”

While she’s generally optimistic that the ship can, in fact, be turned, she is troubled by much of what she’s seeing, especially the exodus of talent to other states. She noted that 22- to 35-year-olds are leaving the state at a rate of 35%, a number significantly higher than it has been historically.

And they’re leaving primarily because of the high cost of living, she said, noting that, while it’s always been expensive to live in Greater Boston — she had to work two jobs to afford her first home — it is much harder to make ends meet now, as evidenced by those two AIM employees who packed the car and moved south and west.

“That’s what I worry about — that’s your talent, those are your creative minds,” Thomson said. “Those are the folks who are going to bring the innovation that has made our economy so great. And we’re not selling them on staying here in Massachusetts.”

And these young people are leaving just as the Baby Boomers are leaving the workforce, she went on, noting that the state now has what would be called an older workforce, with an average age around 40.

“We have to look at this because, as we see the demographic shift, as we see folks retiring, we’re going to have a real problem if we’re not saying to those young folks, ‘this is where you want to stay and work and raise a family,’” she noted. “I really do worry about it, and it’s worse in certain areas and worse in certain industries; the average age of a utility lineman is 57 years old. How are we going to make the energy investments, upgrades, and transitions we need if we don’t have the workforce that’s capable of doing it?”

There are ongoing initiatives to generate interest in such fields, Thomson went on, but the challenge is the full slate of issues that must be addressed simultaneously — and soon.

Which begs the question: where to start?

“The hard thing is, we’re going to have to do a lot of things at once,” she said. “We must take aggressive actions on housing because it’s going to take long, and the price of not acting now is that, once you start losing folks at a high rate, they’re not going to come back. And even if we can build more housing and find creative ways to make some affordable housing, Massachusetts is going to be more expensive than some states.”

It’s the same with the other issues on that long list as well, Thomson went on, adding that, when it comes to housing, new businesses, or other forms of change, communities will need to be willing to adjust — or suffer the consequences.

“Communities that say, ‘this is what my community looks now, change is hard, and we don’t want to adapt,’ those communities are going to lose out to those who are willing to be more adaptive,” she noted. “And then the question is … do we have enough consensus as a state, enough communities willing to step up and do it, that we’re successful?”

Don’t Devalue Professional Credentials

By Contributor
Opinion

Opinion

By Pam Shlemon

In an instance of good intentions gone awry, an effort to hire people because of the skills they possess rather than their college degrees has turned into a concern that certified rehabilitation counselors may not be able to divulge their credentials to clients. That’s not helpful to anyone, especially the clients they serve: people with disabilities.

In January, Massachusetts Gov. Maura Healey signed an executive order requiring the state government to use skill-based hiring practices. That means the state would not ask its job applicants whether they held a college degree, or other advanced certifications, unless it was absolutely necessary for the job, potentially enabling people with relevant experience but not a degree to be hired.

As the leader of a national organization that advocates for people with disabilities, I see the value of skills-based hiring, which would open doors for qualified, motivated workers who may lack a particular degree.

The problem came soon after, with how the Massachusetts Rehabilitation Commission interpreted that order. Commissioner Toni Wolf suggested limitations on how the state’s certified rehabilitation counselors, or CRCs, use and disclose their certification to their clients.

That is a problem. Reducing the emphasis on credentials while hiring is one thing, but trying to erase their importance while performing the job is misguided. CRCs get their credentials from the organization I lead, the Commission on Rehabilitation Counselor Certification. The certification is the national gold standard in the field of rehabilitation counseling for people with disabilities, and it leads to proven better outcomes. Indeed, the Massachusetts Division of Professional Licensure asks for proof of the certification to become a licensed rehabilitation counselor.

Certification for CRCs serves as a quality guarantee, an assurance for a person with a disability that their counselor has the skills, knowledge, and ethical standards to help clients live as fully and independently as possible. A CRC is required by their certification to focus on what the client can and wants to do in their life, and is trained to work toward those goals. The nationally accredited certification is the result of rigorous training, comes with a 50-page code of ethics, and is not lightly granted.

In this field, as in many professions, credentials are important. You trust a certified public accountant, not a bookkeeper, with accounting skills. You bare your soul to a licensed mental-health professional, not someone familiar with some aspects of mental health. When you need surgery, you rely on board-certified surgeons and anesthesiologists, not someone knowledgeable in human anatomy but unlicensed to practice. This is true as well with rehabilitation counseling.

Favoring just skills at the expense of credentials is risky in the field of rehabilitation counseling. The training, the degree, and, most importantly, the certification verify that they know what they are doing. A person hiring a rehabilitation counselor would want to be sure they could do the work, avoid unintentional harm, give accurate information, and not take shortcuts, like referring clients to mediocre employment opportunities misaligned to their skillset or failing to account for their functional limitations. The certification held by a CRC provides that assurance.

A CRC, for example, is committed to helping a person with disabilities find and keep a high-quality job that suits them and bolsters their independence, not just any job. We work with a vulnerable population. The certification is acknowledgement of that and serves as a promise that CRCs never forget their obligations to this population.

Being barred from divulging their credentials hurts the CRCs, too. It’s demoralizing and frustrating to be unable to speak about their qualifications. It’s an erasure of their professional identities.

I have no quarrel with Gov. Healey’s move toward skills-based hiring, which is beneficial to many people in many fields. We at CRCC favor legislation that increases access to certification, including the Tomorrow’s Workforce Coalition, which advocates for workforce-development policies that open up funding for certifications, including the CRC.

Commissioner Wolf’s track record is long and admirable. This is certainly a case of a move made with good intentions and unintended consequences. I hope the commissioner sees that and steps back from this move.

 

Pam Shlemon is executive director of the Commission on Rehabilitation Counselor Certification (CRCC), the national organization that sets the national standard for certification and advocates both for the profession and individuals with disabilities.

 

Franklin County Businesses Face Challenges, but Also Opportunity

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Franklin County Special Coverage

Big Ideas in Small Towns

Lucy Damkoehler has developed a strong following from both within and outside Franklin County for her bakery and cooking classes.

When Lucy Damkoehler returned to Western Mass. after 20 years away, she opened a bakery in a town she knew well — Bernardston, to be exact, with its population of 2,000.

That was in 2018. Today, Sweet Lucy’s Bakeshop is thriving, demonstrating, like many other businesses already have, that it’s possible to succeed in a county whose 26 communities total around 71,000 residents — less than half of Springfield alone.

“It took off right away,” she said. “My prices were competitively high. I knew the cost of food was going up and the cost of labor was going up, so I priced it so I didn’t have to change my prices too often. But people didn’t complain about it, and I felt like it was doing pretty well.”

When COVID shut down much of the world, Damkoehler pivoted to a concept called Take & Bake Meals, which, at its height, was sending 50 to 60 meals out the door each day, which wound up expanding her reach and widening her exposure.

“We were getting people from Connecticut, from New York, discovering us,” she recalled, and those days partly explain why her customer base went from 90% local before 2020 to a ratio today of about 60% repeat customers — who come anywhere from every day to once a month — and 40% travelers checking out the bakery for the first time.

And Damkoehler’s success continues; she used a crowdfunded grant and a bank loan to build an addition, doubling her kitchen space and allowing her to begin offering cooking classes last September. She now employs six full-time bakers and six front-of-house staff, and is looking to hire a chef instructor as well.

“It blows my mind that I’ve only had one class that’s had to cancel due to low enrollment. They usually sell out within a couple of weeks, if not days,” she told BusinessWest. “It shows there’s a major need for that part of the business; there’s nothing like that around here. We’re doing kids’ classes now, too.

“I’m amazed every day that we’re able to do this successfully,” she added, especially in a community of just over 2,100 residents. “The prices are not cheap. But people recognize the value, and they appreciate it, and they’re willing to spend more money on something that’s done right. It doesn’t scare people away.”

So that’s what Damkoehler brought to the table: talent, quality, drive, and the instincts to pivot to what the market needed, which, both during the pandemic and with her classes, generated further opportunities for growth. Meanwhile, other businesses throughout this mostly rural county bring their own differentiators, but they also testify to a supportive, if small, community.

“Business owners here who are thriving have really committed, loyal customers. They have customers who love to come out and spend time there, spend their dollars with them, and they’re focused on providing a really great experience every time someone comes in,” said Hannah Rechtschaffen, director of the Greenfield Business Assoc. (GBA).

“One thing that I hear from some business owners is a sense of community and mutual support,” she added, noting that one of the GBA’s goals is to keep building opportunities for business owners to know each other better, so they can recommend each other.

“I think it’s organizations like ours and like the chamber that are able to listen to business owners and respond and really be another set of hands in their business success. That’s not overrated when you’re wanting to have a brick-and-mortar presence. So I hope businesses will think about opening here; I hope businesses will think about opening a second location here.”

“We were getting people from Connecticut, from New York, discovering us.”

To that end, Rechtschaffen added, “when we’re in conversation with Greenfield Community College about getting an internship program going, or when we’re in conversation with the Franklin County CDC about small-business support and entrepreneurship, all of those relationships are so, so crucial. None of us want to feel like we’re toiling away alone. We want to feel like we’re part of a larger ecosystem.”

Jessye Deane, executive director of the Franklin County Chamber of Commerce and Regional Tourism Council, agreed.

“Partnership and collaboration are the special ingredients in Franklin County. The way our communities come together to support our small businesses, it’s not like anything I’ve seen elsewhere,” she said.

“What I love to see here are thoughtful partnerships and strategies around how to best support business owners in filling in some gaps and resources that some more populated areas have, and how to attract different industries to the area,” she continued, touting, as Rechtschaffen did, the partnership between the chamber and GBA, but also Greenfield Community College, the CDC, and various economic-development entities.

“We want everyone’s business to be as successful as possible and have as many resources as they can tap into to ensure that success,” Deane said. “We wake up every day asking how to best support them.”

 

Declining Numbers

Such partnerships and mutual support are especially meaningful in a county that, after years of plateauing population, has seen those numbers start to creep downward, especially in the small towns beyond Greenfield and Deerfield.

“Certainly, population decline — or the projection of population decline we see — is a pretty major threat to many rural parts of Massachusetts,” said Linda Dunlavy, executive director of the Franklin Regional Council of Governments. “As Baby Boomers age, we need help, and not attracting young people to our region will be a concern for us. So we’re working on that.

Double Edge Theatre in Ashfield

Double Edge Theatre in Ashfield is just one example of the many cultural offerings in Franklin County.

“But population decline also hurts Franklin County and its rural areas because so many state and federal funding formulas, the distribution of aid money to municipalities, is based on population,” she continued. “So as our population decreases, the amount of money we have for infrastructure improvements, for education, etc., also decreases, which compounds the problem: how do we get people to come to our region if we’re not caring for our infrastructure, our assets, adequately?”

Dunlavy, who was named one of the Difference Makers for 2024 by BusinessWest, has been working for the benefit of Franklin County for decades, so she understands its assets — from arts and culture to outdoor recreation to that supportive business community others mentioned — but she understands the challenges of an aging, shrinking population base, too.

“Because we’re so rural, we have to work together,” she told BusinessWest. “We are a very collaborative region, probably one of the most collaborative regions in Massachusetts, because all the regional organizations are working together. We combine services of municipalities, our businesses work together, and they are served by strong regional support systems. It’s a great region to live in — if you know about us.”

A.J. Bresciano, first vice president and commercial loan officer at Greenfield Savings Bank (GSB), has been lending in Franklin County for the past 16 years, and he feels good about the current strength of business activity in the region.

“In terms of business lending, I think there’s some growth and some optimism, post-pandemic, in starting businesses and seizing opportunities to capitalize on improving economic markets. I think there is some opportunity for people with great ideas and a passion for what they do to come in and start something new,” he told BusinessWest.

That said, “there are certainly some challenges in the interest-rate environment,” he added, especially on the residential side, where higher rates and a shortage of housing have taken away the ‘churn’ of a vibrant market. “But I think that will change. Hopefully we’ll see rates start to come down in the near future, which will give people an opportunity to go out and seek new opportunities. We’re pretty optimistic about what the future holds.”

On the plus side, “there’s a lot of interest in this market because it’s less expensive than other markets that are overdeveloped. So a lot of borrowers see opportunity here,” said Peter Albero, chief financial officer and treasurer, noting that GSB originated $100 million in commercial loans and $70 million in residential loans last year. “The residential side is still a little bit lower … but the commercial side is very strong. A lot of banks are competing for strong borrowers.”

The aging of the population has created a fair amount of business turnover, Bresciano added, as long-time business owners are looking to retire and move into the next chapter of their lives.

“So there’s definitely opportunity for someone else to come in with new ideas, new ambitions, and to cultivate a new environment,” he said, pointing to one project — the conversion of the former Wilson’s Department Store in downtown Greenfield to a mixed-use property — as an example of forward thinking.

“None of us want to feel like we’re toiling away alone. We want to feel like we’re part of a larger ecosystem.”

For her part, Deane has seen a pipeline emerge of younger leaders in many Franklin County communities as older leaders, like those older business owners, look to retirement. “I’m excited about the leadership we’re seeing step into those roles,” she said.

 

Plenty to Promote

Rechtschaffen is acutely aware of what a spread-out county like Franklin faces in terms of housing, transportation, and access to amenities, but she tends to light up when talking about what she loves about the region — and there’s a lot of that.

“We have so much amazing outdoor arts, outdoor activities, whitewater rafting, skiing, theater … there are so many things. So I always want to make sure that people know what there is to visit up here.”

The target audience isn’t just visitors from afar, though.

“We have an advantage in Franklin County, which is that people really do want to support local, so it’s important that we have the right retail mix and experience mix here for people to be able to do that,” Rechtschaffen said, which is the impetus behind efforts like the “find it in Greenfield” campaign running on Bear Country radio and through other outlets.

“A lot of people don’t realize what’s so close by. So getting the word out can be a challenge,” she added. “We’re really trying to keep beating that drum and making sure that things are affordable, things are accessible, and we’re bringing businesses into Greenfield and Franklin County that people really want. That’s also a crucial part of the puzzle.”

Dunlavy has helped put many pieces in place, from north-south rail to broadband access to a planned partnership with other regional councils of government on a Connecticut River climate-resiliency plan.

“You do nothing alone. Everything takes partnership and many people working together,” she said. “And I like that part of the job. I like that challenge, and I like that focus. I’m never bored, ever. There’s always something to work on and always something to think about.”

Rechtschaffen never stops thinking about Franklin County, either.

“This is really creative work,” she said, “to be problem solving, to be listening, to be connecting people with one another so that their business can thrive, maybe in ways they didn’t think about. I really love all of this work to grow Greenfield and Franklin County in a way that feels good, for as many people as possible.”

 

Lawsuit Seeks to Limit Federal Reach into State-legal Cannabis Industry

By
Banking and Financial Services

A Matter of Survival

 

When asked what it takes to thrive in the cannabis business these days, Meg Sanders paused before noting that ‘thrive’ is the wrong word.

“I think thriving is part two. Right now, surviving is really the topic of the day. That’s what we need to be looking at,” said Sanders, CEO of Canna Provisions, which operates dispensaries in Holyoke and Lee.

And it’s not just because of the heightened competition that has arisen, both within Massachusetts and from across state lines, though that factor has caused some shops to close, with others likely to follow, as the market begins to settle, eventually determining how many dispensaries is too many.

No, that development has only exacerbated one of the key challenges for cannabis entrepreneurs: the fact that the drug is federally illegal, which makes financing thorny, normal business activities difficult, and the tax environment severe, to say the least.

“Our accounting bill is probably super elevated from a normal business. Our legal bill is probably way larger than a normal business because there are just so many T’s to cross and so many I’s to dot. And that’s just part of it,” Sanders said before detailing issues with access to financial services and lending. “What if we could get SBA loans? What if we could apply for federal grants? I mean, there’s so much money out there that a small business should be eligible for, but we can’t do any of that because we’re federally illegal.”

Meg Sanders

“What if we could get SBA loans? What if we could apply for federal grants? I mean, there’s so much money out there that a small business should be eligible for, but we can’t do any of that because we’re federally illegal.”

With that in mind, a coalition of U.S. cannabis operators and investors filed a lawsuit late last year against U.S. Attorney General Merrick Garland. The coalition asserts that the federal government has no basis for enforcing the Controlled Substances Act against intrastate, state-regulated cannabis operations. The plaintiffs include Canna Provisions; Gyasi Sellers, CEO and founder of Treevit; and Wiseacre Farm, all of which are independent operators in Massachusetts that claim to have suffered significant harm and business challenges due to federal prohibition.

Verano Holdings is also named as a plaintiff, while foundational supporters of the suit include Ascend Wellness Holdings, TerrAscend, and Green Thumb Industries, as well as Eminence Capital and Poseidon Investment Management.

The lawsuit seeks to confirm the rights of Massachusetts and other states to regulate cannabis within their borders, and to limit the federal government’s power to regulate commerce.

The Controlled Substance Act bars the production, distribution, and possession of marijuana, regardless of whether those activities cross state lines or, as in the case of the plaintiffs’ businesses, are intrastate. According to the lawsuit, “this unjustified and unconstitutional prohibition on intrastate cannabis harms plaintiffs and hinders the efforts of states to provide patients and adults with access to strictly regulated and tested cannabis.”

“The purpose of the lawsuit is to basically challenge the constitutionality of the Controlled Substance Act on intrastate activity. Basically, the suit alleges that the federal government has no say what happens within state borders,” Sanders told BusinessWest. “I wasn’t aware of this lawsuit until somebody recommended me to be part of it. So we had substantial meetings with our legal team and our board about this particular issue, and we all felt like there’s something here, and that this is an important way to approach it.”

 

Tough Environment

Cannabis banking has softened somewhat in Massachusetts, Sanders was quick to note. “I would say Massachusetts is probably one of the friendliest banking states in the United States as far as cannabis. We have a lot of very thoughtful, kind, smart bankers out there that are trying to service the industry. And that’s great; we have checking accounts, we have saving accounts, some of us are able to do debit-card acceptance. But we can’t take credit cards. I can’t get a business loan. Equipment loans are out there, but they’re at a really high interest rate. And also, I can’t get access to normal payroll services. So I can’t work with an ADP or a Paychex or some of the big guys that are really good at what they do.

“If you’re signing up to be in cannabis, you’re signing up for all of these headaches. This is the nature of the beast. And it’s not negotiable; those are the facts. This is what we have to deal with every single day. And it’s really, really hard.”

The lawsuit also takes aim at what’s known in the IRS tax code as Section 280E, which originated from a 1981 court case in which a convicted cocaine trafficker asserted his right under federal tax law to deduct ordinary business expenses. In 1982, Congress created 280E to prevent other drug dealers from following suit.

So, while state-legal cannabis businesses are allowed to deduct the cost of goods sold when paying taxes, they can not take other deductions normal to most non-cannabis businesses — salaries, health insurance, utilities, maintenance, and much more. “So I have an effective tax rate of 73%,” Sanders said.

In 2005, the U.S. Supreme Court rejected a challenge to the Controlled Substance Act’s cannabis prohibitions.

But, according to a press release announcing the new lawsuit, “a critical factor in that decision, Gonzales v. Raich, was that the federal government intended to ‘eradicate’ the market for cannabis nationwide. The court concluded that the federal goal of eliminating commerce in cannabis, combined with the assumption in 2005 that intrastate marijuana could not be differentiated from interstate cannabis, justified the Controlled Substances Act’s prohibitions on intrastate cannabis. Neither of those facts, however, are true today. In the 18 years since Gonzales, Congress and the executive branch have abandoned any intent to ‘eradicate’ cannabis, and numerous states have developed regulatory programs for legal marijuana that is not fungible with, and is readily distinguished from, illicit cannabis.”

Indeed, the plaintiffs note, today, 38 states and Washington D.C. have medical or adult-use cannabis programs with significant regulatory oversight, requiring compliance with stringent regulations aimed at protecting patients, customers, and the public, including video surveillance and seed-to-sale tracking.

“Absent the relief sought in this lawsuit, plaintiffs and other state-regulated cannabis operators will continue to suffer severe harms,” the release notes. “State-regulated cannabis businesses are deemed illegal under the CSA; their everyday activities are considered federal crimes. As a result, they are cut off from numerous federal programs and protections (including small-business loans), they are subject to discriminatory tax penalties, and many organizations — including banks and credit-card processors — refuse to do business with them, rather than risk being deemed conspirators, aiders and abettors, or money launderers.

“The result is that many cannabis businesses are suffering, people are losing their jobs, and individual wealth is being destroyed,” the statement continues. “In addition, social-equity licensees harmed by the war on drugs and who were supposed to have equal access to the industry do not have the same benefits as otherwise situated business owners to start a business and build their wealth.”

 

Appetite for Change?

Sanders sees this lawsuit as a kind of parallel track to other ongoing efforts to disentangle federal and state laws, thereby easing the cost of business in the cannabis industry, with many hoping Congress steps in at some point and removes cannabis from the Schedule 1 list of controlled substances.

“There are a lot of legislators that really support and see cannabis as an industry for their constituents and understand that jobs are being created and there’s a lot of revenue. And, bottom line, their voters want to buy weed from a regulated dispensary,” she told BusinessWest. “That’s what we see every single day. We still have more people coming in. And what voters are telling legislators is they want safe access to cannabis.”

At the same time, Sanders understands that Congress has many competing priorities, and that they struggle to come together in a bipartisan way on any issue.

“Until politicians see voters saying, ‘well, because you’re negative on cannabis, we’re not going to vote for you,’ I don’t think you’re going to see a change. I mean, that’s their business. Their business is to get votes. As voters, we want legalization, but there are so many other things that are separating us as a country, and those are way more important, probably, in the eyes of legislators.”

Federal Law Continues to Pose Problems for Cannabis Industry

By
Cannabis Special Coverage

The Constant Disconnect

 

 

 

Scott Blumsack is a general manager of Society Cannabis Co., a licensed retailer, wholesaler, and producer of cannabis products in Massachusetts. He oversees 16 full-time employees and directly serves cannabis products to customers.

He filed for Chapter 13 bankruptcy, which enables individuals with regular income to develop a plan to repay all or part of their debts over time. But the U.S. Bankruptcy Court for the District of Massachusetts denied his repayment plan and dismissed his bankruptcy case.

Why? Because, while Massachusetts law permits the retail distribution of marijuana, it’s still a Schedule I controlled substance, illegal to manufacture, dispense, or possess under federal law. And when Blumsack petitioned for bankruptcy under Chapter 13, he sought to fund his plan with income from his $75,000-a-year job with Society.

Judge Elizabeth Katz agreed with the Bankruptcy Court that, because he is employed in a federally illegal activity, Blumsack could not access Chapter 13 to restructure his finances.

“This banking act has been proposed by bipartisan senators for the last six, seven, eight years, and this is the first year it made it through committee; it’s supposed to get a vote on the Senate floor.”

“There’s just an enormous disconnect between what’s allowed under Massachusetts law and what’s allowed under federal law, and the Blumsack case is a perfect example of this,” said attorney Steven Weiss, a shareholder with Shatz, Schwartz and Fentin in Springfield.

“He was dealing with a controlled substance; that’s where his income was coming from,” he went on. “This guy is doing something that’s perfectly legal in Massachusetts, and yet he’s barred from being entitled to federal bankruptcy relief.”

Steven Weiss

Steven Weiss says he’s surprised lawmakers haven’t moved more quickly toward decriminalizing cannabis on the federal level.

Weiss said Katz, who had taken an oath to uphold federal law, essentially found no way around this nagging disconnect between state and federal law. The case, which has made waves nationally, is being appealed.

This disconnect has thrown a number of wrenches into cannabis businesses, which, among other hurdles, grapple with an onerous tax burden since they can’t write off many of the costs other businesses can. Or, a driver with federal Department of Transportation certification could conceivably lose that license if he transports products across state lines. And attorneys have worried about taking on clients in the cannabis sector, as they are technically advising clients to break federal law.

“Even for me, as a bankruptcy trustee, what would happen if someone suggested I should be appointed trustee or receiver of a marijuana-based business? I don’t know if I could do that, even though it’s legal under Massachusetts law,” Weiss said. “If there’s a change in the presidential administration and someone decides they’re going to enforce the marijuana laws, and there’s a five-year statute of limitations on selling marijuana, am I now a dealer?”

Then there’s banking; most cannabis companies have been all-cash businesses because banks operate under federal statutes.

“The vast majority of Americans live in states with laws that depart from federal law on this issue and where thousands of regulated Main Street businesses are serving the legal cannabis market safely and responsibly.”

But that’s one area that could be changing.

Last month, the U.S. Senate Banking Committee approved the Safe and Secure Enforcement and Regulation (SAFER) Banking Act. The legislation (see story on page 40) would allow financial institutions to do business with the legal cannabis industry without fear of crossing federal banking regulations.

“This banking act has been proposed by bipartisan senators for the last six, seven, eight years, and this is the first year it made it through committee; it’s supposed to get a vote on the Senate floor,” said attorney Scott Foster, a partner with Bulkley Richardson in Springfield. “It’s not law yet, and it may not even get through the House, but you’re definitely seeing little steps moving this forward.”

Meanwhile, the U.S. Department of Health and Human Services (HHS) recently issued an official recommendation to the Drug Enforcement Administration calling for marijuana to be moved from Schedule I to Schedule III status in the federal Controlled Substances Act.

A Schedule I classification is reserved for substances with no accepted medical use and a high potential for abuse, while a Schedule III classification is reserved for substances having a legitimate medical use and a moderate to low potential for physical and psychological dependence.

Despite this difference, cannabis would still be considered a controlled substance, illegal without a valid prescription, so a reclassification wouldn’t change the law around adult-use cannabis — but it would be a small move in that direction.

Scott Foster

Scott Foster says the disconnect between federal and state laws have contributed to making cannabis “a challenging place to be. It’s not for the faint of heart.”

“Moving cannabis to Schedule III could have some limited benefit, but does nothing to align federal law with the 38 U.S. states which have already effectively regulated cannabis for medical or adult use,” said Aaron Smith, CEO of the National Cannabis Industry Assoc. “The only way to fully resolve the myriad issues stemming from the federal conflict with state law is to remove cannabis from the Controlled Substances Act and regulate the product in a manner similar to alcohol.”

Will the federal government ever do that? Stay tuned.

 

Green Wave

Laws to make cannabis legal for adults have passed in 23 states as well as the District of Columbia, and 38 states have laws regulating medical cannabis. Almost 80% of Americans live in a state where the substance is legal in some form.

“The vast majority of Americans live in states with laws that depart from federal law on this issue and where thousands of regulated Main Street businesses are serving the legal cannabis market safely and responsibly,” Smith said. “It’s long past time for Congress to truly harmonize federal policy with those states.”

And there has been some thawing around the edges of the state-federal disconnect. For one thing, more banks, and larger ones, are edging into the cannabis sector.

For example, calling it an underserved industry, Berkshire Bank recently launched a cannabis banking unit that provides tailored banking solutions for businesses. In a partnership with Green Check Verified, a cannabis compliance software company, Berkshire is promising clients a seamless integrated platform that includes an application process, transaction monitoring, compliance, and funds movement.

Foster said he spoke with an executive at Berkshire Bank only 18 months ago who doubted such a move could happen. “They went from ‘absolutely not’ to ‘our doors are open to cannabis.’ That’s a huge shift for a major bank in the region.”

And as more states come around to legalizing cannabis within their borders, there might eventually come a tipping point that lawmakers in Washington, D.C. can’t ignore.

Foster happened to be on a plane recently with a state senator from South Carolina, and they struck up a conversation about their respective jobs.

“He said, ‘we’re considering legalizing medical cannabis in January. Don’t you see a lot of crime?’ I said, ‘No.’ ‘Homelessness around dispensaries?’ ‘No. Quite the contrary.’

“I told him, ‘you’ve got people in your state right now who are growing cannabis. They’re very good at it. They know their stuff. They know the different strains. In my state, those people are employed at cannabis dispensaries. They have respectable jobs, they’re not underground, there’s no risk of them going to jail. In your state, they still can.’”

Weiss told BusinessWest he’s surprised at the lack of movement on decriminalizing cannabis at the federal level, if only because there’s so much money to be made by banks and other businesses that typically have the ear of lawmakers.

“It’s legal in 38 states. Even small banks are looking at opportunities to make loans or investments in the marijuana business,” he said. “And when Wall Street can make money on something, the law will change. That may be a cynical view of the world, but I’m sort of surprised that marijuana hasn’t become at least quasi-legal federally right now. Right now, the way the industry is operating, the government just turns a blind eye to it.”

Until someone like Blumsack gets caught in the crossfire, or until cannabis business struggle under the weight of much higher business costs and much greater challenges than other sectors when it comes to real estate, transportation, security, or any number of other factors.

“I don’t know all the ways that’s going to shake out,” Weiss said. “That inconsistency is a problem for everybody. If somebody wants to change the law, that’s up to Congress.”

A Congress that, if anyone hasn’t noticed, doesn’t like working in a bipartisan way on very much these days.

 

The Next Generation

The landscape on some of these matters may still shift. Foster cited a recent decision from the U.S. Bankruptcy Court for the Central District of California in which a cannabis business, the Hacienda Co. LLC, was able to obtain bankruptcy protection, but only after transferring its cannabis assets to a third party. “The decision by the court could be seen as a roadmap for other companies seeking bankruptcy protection,” he noted, “but only for a complete liquidation, not a restructuring.”

Meanwhile, Foster believes federal decriminalization is coming … eventually.

“We still have octogenarians running parts of the government, and they grew up with ‘drugs are bad,’ and that’s something that’s difficult to overcome,” he told BusinessWest. “Twenty, 25 years from now, it will probably be legal, and everyone will look back and say, ‘that was kind of silly.’ But right now, people have ideas deeply ingrained in them by their church, society, family, personal experience, and they’re not going to get over that. They’re just not.”

Until they are — or a new generation of leaders emerges — the juxtaposition between state and federal law will continue to cause problems in this still-nascent industry.

“It’s still a challenging place to be,” Foster said. “It’s not for the faint of heart.”

Sturbridge Benefits from Being at the Crossroads

By
Robin Grimm says Sturbridge appealed to her for many reasons
Community Spotlight Special Coverage

Community Spotlight

Robin Grimm says Sturbridge appealed to her for many reasons

Robin Grimm says Sturbridge appealed to her for many reasons, from its beauty to its sense of history to its enthusiastic celebration of that history.

Officials in many different communities like to say they’re ‘at the crossroads’ — of their region or even New England.

In Sturbridge … they mean it.

Indeed, this community of just under 10,000 people sits at the intersection of the Mass. Pike and I-84, which begins in the town and winds its way southwest through Hartford and into New York and Pennsylvania. Meanwhile, Route 20, a state highway, and the main east-west corridor before the Pike was built, runs through the town and forms its main commercial artery.

Most area cities and towns also like to say that they have ‘something for everyone.’

In Sturbridge … they mean it.

There are hotels, restaurants, and taverns, as well as campgrounds, hiking trails, and kayaking on the Quaboag River. There’s shopping and antiques (Brimfield is right next door, and there are many shops in Sturbridge itself). There are a few brewpubs, a distillery, and even axe throwing. There’s foliage (many tours of New England’s fall colors end here) and the famous shrine at St. Anne and St. Patrick Parish.

“If you were the Mass. association of anything, Sturbridge is ideal, because we’re dead center — it’s equidistant from the Berkshires to Hyannis. And it’s less expensive than Marlboro or going even closer to Boston.”

Between the accessibility and the all the things to do — and the two qualities are obviously very much related — there are always considerably more than 10,000 people in Sturbridge at any given time.

Some visitors get off those aforementioned roads on their way to somewhere else and often shop, eat, or both. But, more importantly for the town, the region, and the businesses within, many stay for a night or two … or three.

They come for business meetings and conventions; to look at foliage; to camp or park RVs at the two RV parks; to take in the three Brimfield Flea Markets in May, June, and September; for the annual Harvest Festival, staged earlier this month; and to converge for the Pan-Mass Challenge, the bike ride to raise money for the Dana-Farber Cancer Institute, which features a route that starts in Sturbridge and winds 109 miles southeast to Bourne.

Terry Masterson says Sturbridge’s trails, campgrounds

Terry Masterson says Sturbridge’s trails, campgrounds, and RV parks are an often-overlooked but important element in the town’s status as a true destination.

And they come for weddings.

Neither Town Administrator Robin Grimm nor Terry Masterson, the town’s Economic Development and Tourism coordinator, know exactly how many, but they know it’s a big number.

“Weddings are a cottage industry here,” said Grimm, noting that a combination of venues (such as the Publick House Historic Inn and Country Lodge and the Sturbridge Host Hotel & Conference Center), beauty, and position in the middle of the state (and the middle of New England, for that matter) make Sturbridge a popular wedding location.

Alexandra McNitt, director of the Chamber of Central Mass South for the past 17 years, agreed. She told BusinessWest that the community’s location, in the very middle of the state and on major highways, makes it a logical choice for meetings and conventions involving state associations, business groups, and families planning reunions and other types of get-togethers.

“If you were the Mass. association of anything, Sturbridge is ideal, because we’re dead center — it’s equidistant from the Berkshires to Hyannis,” she said. “And it’s less expensive than Marlboro or going even closer to Boston.

“And with families and friends getting together … I can’t tell you how many times we get people who call us and say, ‘I live in Maine, I have some friends coming up from New York or Pennsylvania, and they’re coming to Sturbridge because it’s halfway for both of them,’” she went on. “It happens all the time. So we benefit from this location on the personal level, with small-meeting groups and any kind of state clubs or associations.”

Overall, between the hotels, RV parks, Old Sturbridge Village, the Brimfield antique shows, and the weddings, events, and meetings, Sturbridge draws more than a half-million visitors a year.

And those who find the town will now be able to more easily find out about all there is to do there, and in the surrounding region, with the opening of a new home for the chamber, one that includes a visitors center on River Road, just off exit 5 of I-84 (more on that later).

Meanwhile, there is another potential new draw for this already-popular destination with the planned opening of a combination truck stop and what’s being called an ‘electric-vehicle discovery center,’ said Masterson, where motorists can learn about EV ownership and potentially test-drive vehicles from various manufacturers.

For this installment of its ongoing Community Spotlight series, BusinessWest takes an in-depth look at Sturbridge and how it takes full advantage of its accessibility, beauty, and increasingly diverse business community.

 

Staying Power

Grimm, formerly a town administrator in Stoughton, just south of Boston, and administrator or assistant administrator in several communities in Rhode Island, where she grew up, told BusinessWest that she wasn’t exactly looking for a job when Sturbridge posted for a town administrator early in 2022. But there were many things about the position that appealed to her, from its beauty to its sense of history to its enthusiastic celebration of that history.

“Sturbridge has always been a favorite community for me — there isn’t a kid in Rhode Island who doesn’t take a visit to Old Sturbridge Village,” she said. “I love rural communities, and when an opportunity to work in this part of Massachusetts came up, my ears perked up.

“Sturbridge is particularly unique,” she went on, “because it’s an unusual combination of the beautiful, rural, foothill feel that you get as you start moving west in Massachusetts, and what happens when you have the reality of the intersection of two major highways.”

Masterson, who came to Sturbridge in 2020, has a somewhat similar story. Formerly an Economic Development administrator in Northampton, he said he came to Sturbridge and a similar post there because of that same blend of history and business development. “I enjoy history, so the job posting piqued my interest, and I came and interviewed.”

Masterson said the importance of tourism, hospitality, meetings, and conventions to Sturbridge, and the manner in which all this dominates the local economy, becomes clear as he breaks down the tourism business base, which includes nearly 100 businesses of all sizes.

Visitors to Sturbridge

Visitors to Sturbridge will find information on the community’s many attractions and tourism-related businesses at the new visitors center.

Indeed, there are 11 hotels located in the community, which together boast roughly 1,000 rooms, he said. There are 24 ‘eating establishments,’ three coffee and tea houses, six dessert or ice-cream shops, six brew pubs, five wineries, three orchards, three wedding venues, 17 specialty shops, four RV parks and campsites, five nature trails covering 35 miles, and two golf courses.

All this explains why Sturbridge, which boasts a rich history — Grimm says the Revolutionary War is still a big part of the town’s “culture” — has become such a destination.

Masterson noted that its popularity as a stop, for a few hours or a few days, is made clear in statistics regarding spending on meals; the town has been averaging $63 million annually since 2017, with a high of $72 million in 2022. By comparison, Northampton, a community well known for its stable of fine restaurants, averages $93 million annually.

The hotels have high occupancy rates in spring, summer, and fall, said McNitt, adding that they, and the restaurants, get a huge boost from the Brimfield antiques shows, the first of which, in May, is the unofficial start to the busy season. “That first May show is a huge shot in the arm for the hotels and restaurants; that kicks off the season, and then we’ll be flying until Thanksgiving.”

These numbers, and those regarding overall visitorship, obviously make Sturbridge a popular landing spot for tourism- and hospitality-related businesses, said Masterson, adding that there has been a steady stream of new arrivals in recent years, including several this year.

“Sturbridge is particularly unique, because it’s an unusual combination of the beautiful, rural, foothill feel that you get as you start moving west in Massachusetts, and what happens when you have the reality of the intersection of two major highways.”

They include everything from Wicked Licks, an ice-cream shop that opened on Route 20 near the entrance to Old Sturbridge Village; Tutt Quanti, an Italian restaurant; Heal and Local Roots, two cannabis dispensaries along Route 20; D’Errico’s, an upper-end meat purveyor taking space in the Local Roots facility; and Teddy G’s Pub & Grille, which is occupying the former Friendly’s location on Route 20.

 

Meeting Expectations

In addition to its meeting, convention, and wedding business, Sturbridge and the surrounding area boasts a number of historical and cultural attractions, parks, orchards, trails, golf courses, and other forms of recreation.

Topping that impressive list, of course, is Old Sturbridge Village, one of the nation’s oldest and largest living-history museums, with 40 restored antique buildings, a working farm, two covered bridges, and much more. OSV draws 250,000 visitors a year and hosts hundreds of school field trips, as it has for decades.

There’s also Sturbridge Common, the picturesque town founded in the 1730s, which was, during the Revolutionary War, the site of militia drills and the collection of military supplies, as well as St. Anne Shrine, which has been welcoming pilgrims praying for physical and spiritual healing since 1888.

Sturbridge at a glance

Year Incorporated: 1738
Population: 9,867
Area: 39.0 square miles
County: Worcester
Residential Tax Rate: $18.07
Commercial Tax Rate: $18.07
Median Household Income: $56,519
Family Household Income: $64,455
Type of government: Town Administrator, Open Town Meeting
Largest Employers: OFS Optics, Old Sturbridge Village, Arland Tool & Manufacturing Inc., Sturbridge Host Hotel & Conference Center
* Latest information available

Perhaps less well-known, but increasingly popular — and important to the business community — are the trails, campgrounds, RV parks, and open spaces in Sturbridge.

“We have more than 450 RV pads, which I conservatively estimate will draw more than 100,000 people a year between April and October,” said Masterson, adding that the RV parks, as well as the trails and campgrounds, enabled Sturbridge to continue to draw large numbers of visitors during COVID.

The new chamber office and visitors’ center will help provide more information to those who come to Sturbridge for all those reasons listed above, said McNitt, adding that the town had such a facility years ago, saw it close, but recognized the need to resurrect it.

And many of the businesses and venues that it spotlights helped make this move possible, including the donation of a building for the facility.

“The community has really come together to support this initiative,” McNitt noted, adding that a painting-business owner has volunteered time and talent to paint the facility, while the Publick House donated landscaping, and other businesses have chipped in as well. “It’s definitely been a community effort; they wanted this to come back.”

As for the planned service center and EV discovery center now nearing the finish line, it is one of several such facilities being developed by partners Michael Frisbie and Abdul Tammo, co-owners of Hartford-based Noble Gas Inc. The two partners are building what they tout as a new generation of larger service centers, complete with high-speed electric-vehicle charging stations and a host of other amenities, including an ice-cream shop and outdoor picnic areas.

“If you have an electric vehicle, it’s not like filling your gas tank,” said McNitt, explaining the concept as she understands it. “It doesn’t happen in three minutes; even with a high-speed charger, it takes 20 to 30 minutes, so they’re trying to create an environment that’s friendly toward that.”

It’s just one more way Sturbridge is creating an environment friendly to all kinds of recreation seekers who arrive here at the crossroads.

Owning Real Estate in Other States

By Contributor
Accounting and Tax Planning

What Does It Mean for Estate-tax Liability in Massachusetts?

By Elizabeth Dougal, Esq.

 

Massachusetts estate-planning clients frequently ask whether they should transfer their vacation property, typically located in Florida or New Hampshire, to a limited liability company. The answer is almost always ‘no.’

Why? Because Massachusetts does not tax out-of-state real estate held individually. However, it does tax out-of-state intangible assets. The transfer of the real estate to a limited liability company would convert that real estate to an intangible asset for purposes of the application of the Massachusetts estate tax.

Elizabeth Dougal

Elizabeth Dougal

Let’s say you are a Massachusetts resident with a vacation condominium in Florida valued at $300,000. You die with $800,000 of other assets in Massachusetts. Massachusetts imposes an estate tax up to 16% on a Massachusetts taxable estate of more than $1 million. Massachusetts does not impose its estate tax on real property held individually outside of Massachusetts. Hence, in this scenario, you would owe no Massachusetts estate tax.

What if you transferred that $300,000 Florida condominium to a limited liability company? You sometimes rent it out and want the limited liability company to decrease any liability exposure. Now, when you die, your Massachusetts estate is $1.1 million, thus subject to Massachusetts estate tax. The transfer of the condominium to the limited liability company converted it to an intangible asset includable for Massachusetts estate tax purposes. You could have managed your risk to limit potential liability through the acquisition of appropriate liability insurance instead of transferring it to a limited liability company.

You might also consider transferring your out-of-state property to an entity for probate avoidance, privacy, or ease of future transferability. For these purposes, the use of a simple ‘living’ or revocable trust might accomplish your goal. Massachusetts cannot impose Massachusetts estate tax on real property located outside of Massachusetts, whether held individually or within an arrangement that is the equivalent of individual ownership. A revocable trust is such an arrangement.

One last caveat on the example involving the Florida condominium mentioned above: Florida has no estate tax. Neither does New Hampshire. You may experience a different outcome in states with an estate tax. You will want to consult an estate tax advisor to determine if the state where the property is located has a higher estate tax rate than Massachusetts. If so, use of a limited liability company or other entity may be warranted.

Still, in general, you want to avoid dying as a Massachusetts resident with an estate over $1 million that includes real estate in a limited liability company, unless the real estate is located in Massachusetts or a state with at least an equivalent estate tax.

 

Elizabeth Dougal is an attorney with Bulkley Richardson and a member of the firm’s Trusts & Estates department.

An Investment in Education

By
Opinion

Editorial

 

It’s a significant investment: more than $20 million just for the first year. But it’s an investment that could bring a significant return.

That’s the hope, anyway, of Gov. Maura Healey and other state officials, who officially launched the initiative called MassReconnect with a press conference on Sept. 24 at MassBay Community College in Wellsley.

The program, quite simply, establishes free community college — covering not just tuition and fees, but books and supplies — for academically qualifying students age 25 and older.

The governor laid out the compelling rationale for the program at the event. “MassReconnect will be transformative for thousands of students, for our amazing community colleges, and for our economy,” she said. “It will bolster the role of community colleges as economic drivers in our state and help us better meet the needs of businesses to find qualified, well-trained workers. We can also make progress in breaking cycles of intergenerational poverty by helping residents complete their higher-education credentials so they can attain good jobs and build a career path.”

Let’s consider those points one at a time.

Western Mass., where four of the state’s 15 community colleges — Berkshire Community College, Greenfield Community College, Holyoke Community College, and Springfield Technical Community College — are located, needs them to be strong and vibrant to generate, and maintain, a strong pipeline of workers coming into myriad fields.

Meanwhile, at a time when businesses of all kinds are struggling to attract and retain talent, making it easier for non-traditional students — those who haven’t started in college, or who have started but haven’t completed, for one reason or another — to enter career pipelines could make a real difference in those companies’ growth, and even survival.

Meanwhile, Healey is right: there’s no doubt that education is a key factor in overcoming barriers to economic success; it isn’t hard to imagine that many students taking advantage of this program will represent the first generation of their family to attend college.

Holyoke Community College President George Timmons believes that “MassReconnect will enable our community colleges to do more of what we do best, which is serve students from all ages and all backgrounds and provide them with an exceptional education that leads to employment and, ultimately, a stronger economy and thriving region.”

MassReconnect is expected to support up to 8,000 community-college students in the first year, which could grow to closer to 10,000 students by FY 2025, depending on how many students take advantage of the new opportunity. There are approximately 700,000 Massachusetts residents who have some college credit but no degree. MassReconnect could help bring back these students to finish their degrees, with the additional funding and support they may have lacked the first time around.

Meanwhile, the Commonwealth’s 15 community colleges are a ticket to economic mobility for many residents. Nationally, employees who have earned their associate degree are paid 18% more than workers with only a high-school diploma, according to the Bureau of Labor Statistics. As for those jobs, in July, there were more than 26,000 job postings in Massachusetts that specifically required an associate degree.

The hope is that MassReconnect will harness the power of community colleges by allowing workers to earn the training and education necessary to jump-start their career growth and reinforce a pipeline of skilled professionals entering the workforce. That’s what this is about, and why Healey and other proponents and believe the state’s investment will be more than justified by its return.

“MassReconnect will be a game changer for residents 25 and over in the Pioneer Valley and throughout the Commonwealth,” Greenfield Community College President Michelle Schutt said.

Let’s hope it changes the equation for employers — and the state’s entire economy — as well.

Farm Resiliency Fund Established in Wake of Flooding

By
Nonprofit Management

Streams of Assistance

 

Call it a flood of support at a critical time.

On July 20, the Healey-Driscoll administration and the United Way of Central Massachusetts (UWCM) announced the Massachusetts Farm Resiliency Fund, a partnership between philanthropic organizations and private foundations intended to support Western and Central Mass. farms impacted by recent flooding and strengthen farm resiliency in the long term. Officials made the announcement at Mountain View Farm in Easthampton, which had much of its crop destroyed by flooding.

Megan Burke

Megan Burke

“We seek to ensure that this coordinated effort provides immediate relief that works for farmers and addresses longer-term food-security issues for vulnerable residents of our region.”

The Massachusetts Department of Agricultural Resources estimates at least 75 farms have been hurt by flooding, with about 2,000 acres in crop losses at a minimum value of $15 million. That number will likely climb as more damage is assessed and the longer-term impacts set in.

“As the lieutenant governor and I have visited farms across the state, we’ve been deeply moved by the devastating impacts we’ve seen and heartbreaking stories we’ve heard. We’re grateful to our philanthropic and private partners for quickly answering the call to action and creating this fund to deliver relief directly to farmers,” Gov. Maura Healey said. “This is about team Massachusetts — where we come together to support farmers and their livelihoods, build resilience for our farms and food supply, strengthen our economy, and create a stronger future for our children and families.”

Lt. Gov. Kim Driscoll added that “Governor Healey and I have heard firsthand from dozens of farmers who are grappling with the aftermath of extreme flooding and trying to figure out how they’re going to make ends meet and keep their farms. We’ve been inspired by their resilience and the pride they take in their businesses, which play an essential role in our state’s food supply and economy. The Massachusetts Farm Resiliency Fund will be a lifeline for so many dedicated farmers and their families.”

Several nonprofit leaders were quick to commit to supporting farmers through the fund.

“In light of the devastating impact of recent floods, the Community Foundation of Western Massachusetts is committed to supporting the Massachusetts Farm Resiliency Fund,” CFWM President and CEO Megan Burke said. “We seek to ensure that this coordinated effort provides immediate relief that works for farmers and addresses longer-term food-security issues for vulnerable residents of our region.”

Philip Korman, executive director of Community Involved in Sustaining Agriculture (CISA), added that “this month’s rains and floods, occurring in the middle of the summer harvest, will have a bigger impact on our farms than Hurricane Irene. It has been heartening to see the community rally around our local farmers, the very people who feed our families. The newly created Massachusetts Farm Resiliency Fund is a powerful example of what can be created when government, foundations, businesses, and nonprofits like CISA work together. The fund will be an essential piece of helping farms recover and will serve as part of the safety net to future climate change events.”

Sen. John Velis

Sen. John Velis

“The flooding has decimated folks’ businesses, jeopardized their livelihoods, and has had a tremendous impact on our Commonwealth’s agricultural sector and our food supply as a whole.”

Meanwhile, Mark Gold, director of the Harold Grinspoon Charitable Foundation, praised the administration for addressing flood relief in a timely manner. “Our foundation remains committed to providing support to those farms impacted by the recent floods along the Connecticut River Valley and others to which we and our partners have provided support over the past nine years.”

Local legislators were quick to praise the joint effort between government and philanthropic community.

“Farms throughout Western Massachusetts have been devastated by the recent flooding in our region, and the full scale of damage is unfortunately expected to grow even more,” state Sen. John Velis said. “The flooding has decimated folks’ businesses, jeopardized their livelihoods, and has had a tremendous impact on our Commonwealth’s agricultural sector and our food supply as a whole. I am grateful to the Healey-Driscoll Administration, UWCM, and all the philanthropic and private foundations for their fast work in creating the Farm Resiliency Fund and for their commitment to helping our farmers get back on their feet.”

State Rep. Natalie Blais agreed. “Following the devastation caused by recent rains and flooding, the Healey-Driscoll administration stood with us, in our fields, to hear directly from farmers,” she said. “I am profoundly grateful to our community for coming together to support farms across the state, and for Governor Healey’s commitment to the long-term sustainability of agriculture and our local food systems.”

Tim Garvin, president and CEO of United Way of Central Massachusetts, called the new fund “a most beautiful demonstration of real partnership, united in compassion and united in purpose to support and assist our farmers,” adding that he is hopeful that many will be inspired to contribute.

“As someone who sees the devastating impacts of the recent flooding every day, I am extremely grateful for the quick efforts of the Healey-Driscoll administration and the United Way of Central Massachusetts to put the Massachusetts Farm Resiliency Fund in place,” state Sen. Jo Comerford said. “We must continue to take concrete steps to help the farmers who so desperately need our quick action and sustained efforts to help in their recovery.”

Comerford also praised the state Senate the following week for passing a $513 million supplemental budget for FY 2023 that includes $20 million in assistance for farms throughout the Commonwealth impacted by recent severe weather events.

“These public funds will go out as direct grants,” she explained. “That’s money in the pockets of farmers who have experienced a massive hardship in the wake of the extreme flooding earlier this month and the frosts and freezes this past spring.”

Other organizations have stepped up to help as well, such as UMassFive College Federal Credit Union, which recently announced a donation to aid local farms impacted by the flooding, including Natural Roots Farm, Mountain View farm, Pepin Farm, Community Care Apothecary, Song Sparrow Farm, Stone Soup Farm, New Community Farming Cooperative, World Farmers’ Flats Mentor Farm, and the Grow Food Northampton Community Farm.

“We are deeply connected to our community and our members, and we understand the critical role that local farms and local food play in our lives,” said Craig Boivin, vice president of Marketing at UMassFive. “Our donation to the local farms impacted by the floods is an expression of our gratitude and commitment to helping our neighbors in their time of need.”

As for the Massachusetts Farm Resiliency Fund, all funds will be distributed rapidly by the United Way through a deliberate selection process. More information about the fund can be found at unitedwaycm.org/farmfund.

“For generations, our farms have been part of our cultural heritage and the fabric of our local communities,” Massachusetts Department of Agricultural Resources Commissioner Ashley Randle said. “As heartbreaking as it has been to see our farming community hit hard, I’m truly inspired to see the community step up and rally around our farmers with this partnership that will bring much-needed relief.”

 

Franklin County Thrives Through Connection

By
Brolin Winning, general manager of the Shelburne Springs
Cover Story Franklin County

Northern Exposure

Brolin Winning, general manager of the Shelburne Springs

Brolin Winning, general manager of the Shelburne Springs luxury hotel, sees many signs of new life along the Mohawk Trail.

Brolin Winning and his wife used to run a barbecue stand on the Mohawk Trail, and he’d occasionally look up at the abandoned building next door, a mansion built in 1914 that later operated for decades as the Anchorage Nursing Home before closing in 2011.

“We’d look up the hill at this place — which had been abandoned for a decade — and just think, ‘man, that’s a sweet spot.’ But it was just melting into the ground.”

But then a friend came into some money and was looking for an investment project. “I said, ‘you should buy the nursing home,’” Winning recalled. So they did — and begin fixing it up.

That was early 2020, when COVID hit, but the ensuing shutdown of the hospitality economy gave the team — owner Hilltown Lodge LLC, Thomas Douglas Architects of Northampton, and Tristan Evans Construction of Greenfield — time to redesign the space, gut the building down to its studs, and restore it with seven spacious suites; a kitchen, bar, and upscale but cozy lounge areas; and outdoor relaxation and recreation space across 38 acres. Among the next plans is a big stage up the hill for weddings and other events.

“I couldn’t wait to come back, just to be in the woods again and on the river again. It’s just, like, the best place to live.”

But while Winning is gratified that the hotel, called Shelburne Springs, has had a successful first few months, he doesn’t view the property in a vacuum, but as part of a renaissance along the Mohawk Trail that includes renovations and reopenings at the Sweetheart Restaurant in Shelburne Falls, the Duck Pond antique shop in Shelburne, the Blue Vista Motor Lodge just over the Berkshire County line in Florida, and more.

“There’s a lot of stuff going on, whereas I feel like it was … I wouldn’t say run-down, but quiet for a while,” Winning said. “COVID obviously affected everybody in this area, but a lot of people were coming out here even more because we’re like in the country and away from the crowd, and there’s a lot of outdoorsy stuff.

Jeff Sauser (left) and Jeremy Goldsher

Jeff Sauser (left) and Jeremy Goldsher have expanded Greenspace CoWork to a second location on Main Street in Greenfield.

“I’ve lived all over the country; I’ve lived a long time in California, Boston, Chicago, and different cities,” he went on. “But I’ve always loved it here. I grew up in Amherst and Northampton, but I used to come up here to fish when I was a kid. That’s how I got into the Mohawk Trail. To me, there’s nowhere like it. I was in San Francisco for a long time, and I would come back here twice a year. And I couldn’t wait to come back, just to be in the woods again and on the river again. It’s just, like, the best place to live.”

He’s not the only one who feels that way about this county of 71,000 residents — fewer than half the total of Springfield — spread across 26 communities.

“It’s stunningly beautiful. That can’t be overlooked,” said Hannah Rechtschaffen, recently appointed coordinator of the Greenfield Business Assoc. (GBA). “And I think there is a wonderful, long history up here of people being very engaged in their communities. When you travel from town to town, you find a lot of residents and business owners who feel very passionate about that, about the town that they’re in.”

“I feel like if you wanted to kill as many birds as possible with one stone, a robust housing strategy would be the way to do it.”

Rechtschaffen cited draws like the county’s outdoor recreation experiences and attractions like Bridge of Flowers in Shelburne Falls and Poet’s Seat Tower in Greenfield, but said tourists find much more.

“People come for these beautiful experiences, and they’re also finding other cool stuff, from whitewater rafting to restaurants. So the challenge is to reach out to people up and down the Valley and let them know there are really lovely experiences close to them,” she said. “All these towns have something special to offer, but together, we can offer something really beautiful.”

For residents and business owners, she added, “because it’s a small county, it has a bit of history of people needing to go to neighboring communities for different things. When you have that history of people stepping to the community next door to find something, you have this nice connectivity, which has gotten more robust over time. You have an opportunity for towns in Franklin County to work together in a unique way.”

Hannah Rechtschaffen, Franklin County CDC Executive Director John Waite, and Lisa Davol

Some of the players invested in a more robust Franklin County are (from left) Greenfield Business Assoc. Coordinator Hannah Rechtschaffen, Franklin County CDC Executive Director John Waite, and Lisa Davol, marketing manager of the Franklin County Chamber of Commerce.

Jessye Deane, executive director of the Franklin County Chamber of Commerce and Regional Tourism Council, agreed.

“I think one of the major strengths of Franklin County is that we have a comprehensive set of supportive services around business development,” she said, citing robust connections between the chamber, local businesses, workforce-development and entrepreneurship-focused agencies, and legislators.

“Collaboration is really the only way forward for us. I think Franklin County has always used partnership and collaboration as a special sauce, and I think that served us well during the pandemic. And part of the chamber’s job is to continue to fuel those collaborations and help make those connections.”

Clearly, it takes a village — well, 26 of them — to create a culture in the northernmost county of Western Mass., one that faces challenges, but also has more to offer than many outsiders realize.

 

Challenge and Opportunity

Deane said many of Franklin County’s challenges are no different than those seen across Western Mass.

“Of course, housing is a challenge. And transportation is particularly troublesome in more rural communities because that’s a barrier to a lot of our entry-level employment. And childcare is huge; there is a lack of high-quality childcare in this area.”

“One of the things I appreciate about Franklin County is that we can keep our identity — we have the nature, the beauty, the rural luster of it — but there’s increasing opportunity.”

Hiring also continues to be a challenge across industries, she added — another issue being felt across the state.

“I think we have a unique twist on that because we are a rural community, so it’s a little more exacerbated on this side of the state. One of the challenges I’m particularly concerned about is the population-decline projections. So we’re working overtime in collaboration with our legislators to make sure the Commonwealth is more equitably funding projects and initiatives across the state and, as a chamber, making sure that we’re doing our best to shine a light on why Franklin County is such a great area to live and work, and hopefully attracting new families to the area.”

She said the Regional Tourism Council’s task is to attract more tourism to a county that already brings more than $79 million in tourism dollars every year to destinations ranging from Berkshire East in Charlemont to Northfield Mountain and Sugarloaf Mountain; from Yankee Candle and Tree House Brewing Co. — and its slate of summer concerts — in Deerfield to Hawks & Reed Performing Arts Center in Greenfield and Double Edge Theatre in Ashfield.

Ashley Evans

Ashley Evans says reopening the Farm Table in Bernardston was an opportunity she couldn’t pass up.

“Tourism is really about OPM: other people’s money. And we want to make sure that we are helping them spend that here. And there is so much to do,” said Deane, who calls Franklin “the fun county,” and wants more people to know about that.

“There are endless opportunities for fun in Franklin County. And in terms of our work in the Regional Tourism Council, we’ve made some significant strides. In the past year, we branded our tourism side. We worked with a local company to give Franklin County a really great visual presence, with the tagline ‘more to Franklin County,’ because one of the things that we found when we did that investigative work is that folks said there’s always more to do: ‘I didn’t expect there to be so much. We’ve got to come back.’”

The council is also in the process of launching a standalone tourism website, Deane added.

“We want to make it easy as possible for people to plan their trip, and we’re working with our hospitality vendors to do itinerary planning based on any given interest. So if you’re really into craft beverages, this is what you can do for a weekend. If you’re really into outdoor recreation, this is what we recommend you can do for a weekend.”

A member of the Greenfield Business Assoc. who is about to join the Franklin County Chamber of Commerce, and whose family owns Hawks & Reed, Jeremy Goldsher also co-owns Greenspace CoWork with Jeff Sauser, so he has a broad perspective on business life in Greenfield and its environs.

“We’ve seen already that Hawks & Reed started a bit of a new music and cultural renaissance in downtown, to the point that now you can’t walk around in any given weekend without seeing kids running up and down the streets of different local venues,” Goldsher noted.

As the owners of Greenspace CoWork, which now has two facilities on opposite sides of Main Street in downtown Greenfield, Goldsher and Sauser have cultivated key business connections through programs like the monthly Business Breakdown networking events.

“It’s developed quite a bit, from ‘I need some emotional support from my business peers’ to a really fun, informal gathering of a lot of our favorite business leaders, business owners, and a group of young, entrepreneurship-minded folks that we’ve never met,” Goldsher said. “We always get new folks at each meeting. We’re now in our 14th or 15th run of it, and I think the Business Breakdown has been a gateway for us to really get onto the map of Franklin County in a bigger way than our co-work business was permitting us.”

With programs like Business Breakdown and a six-month accelerator program, Goldsher is starting to see a “domino effect” of key connections. “We’re starting to see the Franklin County CDC, which has been a great partner of ours, become a lot more visible in their entrepreneurial work and various programs starting to revolve around specific topics, which is great.”

 

Planting Roots

Emerging from the pandemic, those connections are more crucial than ever, Sauser said.

“We’ve had our ups and downs with the economy. We got through COVID. I think we’ve been an important part of the downtown revitalization, especially with the move to remote work and more flexibility. That’s important to the economic-development story of Franklin County in general, along with getting broadband access out there and just making this a place people can do a job that’s based anywhere, so they can live where they want to live.”

After all, while tourism is critical to the economy, Sauser said, tourism can’t be all Franklin County offers; it has to be a place people want to live and work, and where they find it affordable and rich enough in amenities to do both.

As an urban planner who has done a lot of policy and analysis work in housing, he said housing is the biggest issue.

“I feel like if you wanted to kill as many birds as possible with one stone, a robust housing strategy would be the way to do it. People are moving here in part because they can’t find the housing they’re looking for; nationwide, there’s a huge shortage.”

So there are real opportunities for growth, he said, adding that municipalities need to be smart with not only strategies for housing development — the residential units coming online in the former Wilson’s Department Store building in downtown Greenfield is a “game changer” for the city, he said — but with property taxes as well. The other big draw for families is school systems, and Sauser said many communities still have room for improvement there.

“That can hold places back. There are other options out there, private schools and charter schools, but the core of the public school system isn’t as successful as it could be.”

For every challenge, though, there are business success stories, Deane said.

“One that comes to mind is Sweet Lucy’s Bakeshop in Bernardston,” she said. “Lucy moved back into the area from Seattle. She crowdfunded to start her business. She’s now expanding. And that’s in partnership with support from the chamber, from the great folks at CISA, from the CDC. She’s really taken this bake shop and made it famous across the county. And she’s now expanding to include a community center so that she can help teach cooking courses or baking classes.”

A stone’s throw from Lucy’s is the Farm Table, the iconic Bernardston eatery on the Kringle Candle property that closed in 2020 but is reopening this month under the management of serial restaurateur Ashley Evans, who grew up in Turners Falls and was intrigued by the possibility of reopening the Farm Table while on a visit from her home in the state of Florida.

“When I came to this property, how could I pass it up? It’s just absolutely breathtaking, everything about it,” Evans said, adding that the goal is to offer an elevated culinary experience, with many ingredients locally sourced, but at a less elevated price than before.

“We plan on having a similar menu, but redone and more adapted to the market in this community. Instead of a fine-dining establishment, we want to make it an everyday establishment. You can stop by and get something, and the bill’s not $300.”

Evans also plans to host events, from outdoor movies to Hawaiian nights; from outdoor clambakes to a haunted house in the event center.

“We have a lot of ideas to bring the community together,” she said, adding that, despite the workforce pains plaguing the hospitality industry, she was able to staff up quickly, which says something about the establishment’s reputation.

“That speaks to what this property is. It almost speaks for itself,” she noted. “I didn’t have to do a ton of marketing; we said we’re hiring, and people were anxious to work here, which is a beautiful thing.

“I’m so pumped. I’m excited,” Evans added. “I just walk in and feel grateful every day.”

 

Grit and Gratitude

So does Rechtschaffen, who spent almost two decades away from Western Mass. before returning in 2018 and immediately immersing herself in Franklin County life, chairing the Sustainable Greenfield Implementation Committee, which supports the use and implementation of the city’s master plan, and serving on the Downtown Greenfield Alliance and the Local Cultural Council.

She was director of Placemaking for W.D. Cowls in North Amherst before taking on her current leadership position with the GBA, where she’s focused on how businesses in this largely rural county can thrive in the post-pandemic years.

“We’re looking at how people are locating themselves, especially with remote work, with proximity to Boston. We are seeing people come into this area with a different sense of how they’d like their lives to be,” Rechtschaffen said. “We welcome people in who are looking to move out of city-centered life without sacrificing the feeling of community and connectedness and available amenities.”

Deane said the past few years have taught resilience to residents and businesses here, but also new ways forward.

“Economic development is really a long game. So we’re having these conversations now that hopefully will impact the next 15 or 20 years,” she explained. “And we’re doing that with a fresh understanding that, at any point, those plans can go completely rogue and be blown up by whatever comes next. So we’re being cautiously optimistic as we plan and prioritize on a regional level.”

To Sauser, the county’s value is evident in its people, its businesses, its quality of life, and the places that bring those people — and visitors — together.

“I feel like it’s a place to watch,” he said. “I’ve been told, when I moved here, that Greenfield is the kind of place that always feels like it’s about to turn the corner, but it never actually does. I’m getting a lot of signals now that it’s looking pretty good.”

Rechtschaffen agreed.

“One of the things I appreciate about Franklin County is that we can keep our identity — we have the nature, the beauty, the rural luster of it — but there’s increasing opportunity,” she said. “It’s becoming easier to say, ‘this is what Greenfield is all about, this is what Franklin County is all about, and you’re welcome to be here.”

Incorporations

By
Incorporations

The following business incorporations were recorded in Hampden, Hampshire and Franklin counties and are the latest available. They are listed by community.

ADAMS

Creative Thought Institute Inc., 27 Park St., Adams, MA 01220. David Watson, same. Nonprofit organization established to advance creativity as a tool for personal and educational growth within the community through programming and instruction.

BELCHERTOWN

Bethel Ministries for All Nations Inc., 55 North Main St., Suite 16, Belchertown, MA 01007. Archibald Nebedum, same. Religious organization established to teach, preach, and study the gospel of Christ; to advance its membership in faith, hope, and charity; and to promote the advancement and glory of Christ’s kingdom by missionary, benevolence, and Sunday-school work.

CHICOPEE

Edu Janitorial Inc., 21 Grape St., Apt. 1, Chicopee, MA 01013. Eduardo Alves de Oliveira, same. Janitorial services.

EASTHAMPTON

Dalhaus Properties Inc., 11 Cherry St., Easthampton, MA 01027. Sarah James Dalhaus, same. Management of rental properties.

GREENFIELD

Nor’easter Reta Chapter Inc., 28 Ferrante Ave., Greenfield, MA 01301. Heather Savard, same. Educational and training events for members and non-members in the field of industrial refrigeration and ammonia.

LUDLOW

Pinpoint Precision Inc., 42 Perimeter Road, Ludlow, MA 01056. Joseph Deliso, 38 Virginia St., Springfield, MA 01108. Business of manufacturing processes, including precision drilling and honing services, and all related services and activities.

PITTSFIELD

Charles Scientific Inc., 82 Wendell Ave., Suite 100, Pittsfield, MA 01201. Evan Catudal, 40 Governor St., Apt. 2, Providence, RI 02906. Consulting services to the biotechnology and pharmaceutical industries and to develop drugs, biologics, and/or medical devices.

A Hipérbole Corp., 82 Wendell Ave., Suite 100, Pittsfield, MA 01201. Roberta Silveira de Paiva Cabral, same. Business-consulting services.

Vathin America Co. Ltd., 82 Wendell Ave., Suite 100, Pittsfield, MA 01201. Zhenhua Zhou, same. Medical product customer service, maintenance, import, and export.

SHELBURNE FALLS

Waly Cash Inc., 5 State St., Suite 1, Shelburne Falls, MA 01370. Sacha Tueni, 1001 Bridgeway, Sausalito, CA 94965. Peer-to-peer payment service.

SPRINGFIELD

Center Community Center Inc., 33 Oak St., Springfield, MA 01109. Althea Haines, 61 Mary Coburn Road, Springfield, MA 01129. Nonprofit organization established to secure and provide opportunities for youth and families in the community by offering a safe place to engage in activities, health, fitness, sports, workshops, etc.

The Heart Home Inc., 34 Front St., Suite 211, Indian Orchard, MA 01151. Dakota Lamont Cotton Smith, 211 Rosewell St., Springfield, MA 01109. Services to individuals seeking low- to high-threshold facilities, those seeking emergency shelter, and persons seeking transitional housing.

KSW/SBI Inc., 52 Biltmore St., Springfield, MA 01108. Karen Smith Wohlers, same. Holdings company.

WEST SPRINGFIELD

Willow & Moss Flowers Inc., 954 Westfield St., West Springfield, MA 01089. Ahrayah Julian, same. Florist.

WILBRAHAM

Silverauto Inc., 24 Briar Cliff Dr., Wilbraham, MA 01095. Maria Serra, same. Automotive repair service and sales.

Massachusetts Awards $14 Million to Address Digital Equity

By Contributor
Cybersecurity

Bridging the Divide

Leaders from the Commonwealth’s Executive Office of Economic Development and the Massachusetts Broadband Institute (MBI) at MassTech recently announced $14 million in new grants from the state’s Digital Equity Partnership Program to address statewide digital-equity gaps during an event at Tech Foundry in Springfield.

The three grants were announced by Economic Development Secretary Yvonne Hao, who highlighted selected projects from Tech Goes Home, which will receive $4.5 million; Vinfen, on behalf of the Human Services Alliance for Digital Equity, which will receive $4.3 million; and Baystate Health, on behalf of the Western Massachusetts Alliance for Digital Equity, which will receive $5.1 million.

“Massachusetts has a real opportunity to close the digital divide and ensure all people in our state can participate in the digital economy,” Hao said. “These grants will help residents build their digital skills and get online affordably, thereby expanding their connections to job and training opportunities, healthcare resources, social connections, and so much more. We are grateful to the Massachusetts Broadband Institute for its work to make affordable high-speed internet available to residents across the state.”

The secretary was joined at the event by business and nonprofit leaders from across the state, highlighting the critical need for increased digital connectivity for residents statewide, an issue that grew in importance during the COVID-19 public-health crisis. Following the secretary’s remarks, MassMutual Chairman, President, and CEO Roger Crandall spoke about the issue, appearing in his role as a board member of the Massachusetts Competitive Partnership, which published a report last year titled “Connecting Communities through Digital Equity,” highlighting the importance of addressing digital equity statewide.

“Internet access is a crucial driver of economic and social advancement, from fostering innovation and creating new jobs to utilizing government and community services,” Crandall said. “Yet, far too many households in Massachusetts lack broadband service, creating a significant barrier to many career and educational opportunities. The business community has a collective responsibility to help address this inequity by continuing to invest in and expand access to digital infrastructure, literacy programs, and affordable digital tools for all residents throughout the Commonwealth.”

The event included a roundtable discussion with executives from the three grant-recipient organizations, which pointed to the digital-equity challenges Massachusetts citizens face each day and how the awarded projects aim to increase connectivity and access. The grants will support two years of critical digital-equity project development and implementation across the state.

“The genesis of the Alliance for Digital Equity in June 2020 was a direct response to digital disparity — not new — and our societal dependence on the internet to address to meeting basic material needs as the COVID-19 pandemic surfaced,” said Dr. Frank Robinson, vice president of Public Health at Baystate Health. “It was embarrassingly obvious that digital marginalization for already-marginalized people would exacerbate negative health outcomes, economic oppression, and racial injustice. Digital equity and inclusion is truly a super-social determinant of health, critical to our meaningful progress toward health equity and satisfying basic human rights in this connected society, linking people to vital resources, such as jobs, education, healthcare, food, and information.”

The Digital Equity Partnerships Program was launched in September 2022 with the goal of designating qualified organizations to implement projects that meet the goals outlined in the Commonwealth’s ARPA COVID recovery legislation, which created a $50 million fund to bridge the digital divide in the state.

“I am thrilled to see that Baystate Health, in partnership with the Western Massachusetts Alliance for Digital Equity, have been recognized by the Commonwealth’s Digital Equity Partnership Program and received a grant of $5.1 million to continue addressing the digital divide,” state Sen. Jo Comerford said.

State Sen. Adam Gomez added that “the funds created by the ARPA COVID recovery legislation of 2021 represented a momentous step toward bridging the digital-equity divide for Western Massachusetts. There are far too many unserved communities in this region of the Commonwealth who do not have simple access to WiFi. Communities in this region will now have substantially increased access to not only WiFi, but also support for key programming areas such as digital literacy, public-space internet modernization, and connectivity initiatives for economic hardship. Eliminating the digital-equity divide in Western Mass. is absolutely crucial to supporting a thriving economy.”

While the state has made trides to improve broadband and WiFi access, state Rep. Lindsay Sabadosa noted, many communities have been left behind, much public housing remains unwired, and towns that don’t know how to fund projects that would level the playing field for all residents. “The Digital Equity Partnership Program will assist these communities, providing important funding and assistance in learning how to incorporate this technology into their daily lives.”

Springfield Mayor Domenic Sarno said the Digital Equity Partnership Program will help eliminate or mitigate the barriers faced in accessing digital equity and help close the digital divide. “Access to affordable and reliable internet is essential for our residents, and achieving this goal will not only enhance the quality of life for many, but will also help advance vital economic-development projects and educational initiatives, not only here in Springfield, but across the Commonwealth.”

The state’s digital-equity programs build on initiatives launched in response to the COVID-19 public-health crisis, which included public WiFi hotspots in unserved towns in Western and Central Mass., as well as the Mass Internet Connect program, which worked with MassHire to provide financial support and digital-literacy tools to help get unemployed residents back to work.

The MBI has also launched a Municipal Digital Equity Planning Program to support Massachusetts communities with planning activities that will help build a broad understanding of how a lack of internet access is impacting residents in their community, as well as a Broadband and Digital Equity Working Group comprised of stakeholders from across the state that will inform the makeup and focus of state programs, providing key technical expertise and representation of target populations.

“Our partner organizations are leaders in the digital-equity field and have cultivated an incredible network of local stakeholders who will ensure these funds have maximum benefit to the communities they are designed to serve,” said Michael Baldino, MBI director. “Today’s grants, coupled with our municipal planning program and the engagement of our dedicated working-group members, will ensure that the dollars invested lead to the desired impact — more residents will not only gain access to devices, digital skills, and more affordable internet, they will have access to a wider range of social, educational, and healthcare resources.”

State’s Workforce Has Become More Female, Older, More Diverse

By Contributor
Women in Businesss

Changing Tides

The Massachusetts labor force has transformed in recent decades, with some of the biggest changes being the advancement of women, workers getting older and more diverse, and a divergence in labor-force participation rates based on levels of educational achievement.

Those are among the findings in “At a Glance: The Massachusetts Labor Force,” a policy brief written by Aidan Enright and published by Pioneer Institute, with data drawn from the institute’s new laboranalytics.org website.

“Decreasing labor-force participation rates among prime-aged (25-54) men and college-educated individuals may portend future labor shortages,” Pioneer Institute Executive Director Jim Stergios said.

Nationally, the labor-force participation rate among 25- to 54-year-old men has fallen from 96.2% in 1948 to 88.8% last year.

Massachusetts had nearly 300,000 unfilled jobs in 2021. Inadequate daycare capacity, a mismatch between the skills needed for these jobs and the skills possessed by potential workers, immigration restrictions, and a spike in retirements during the pandemic are among the reasons economists cite for the shortage.

The number of individuals 65 and older in the Massachusetts workforce rose dramatically in recent years, then plateaued and decreased from 2019-21, possibly due to retirements during the pandemic. Overall, the number of older workers more than doubled between 2007 and 2021, from 131,000 to 271,000.

The increase in older workers was particularly notable among women aged 55-64. Between 2007 and 2021, an additional 105,000 women in that age group entered the workforce, compared to 79,000 men.

According to the report, women are likely the reason why New England has a high labor-participation rate compared to other census regions, as women there have a higher rate than in all but one other region. New England men, on the other hand, had the fourth-highest rate out of nine total census regions in 2021.

The pandemic also affected women the most — their employment rate dropped 7.7% compared to 6% for men — even though their recovery from it has been quicker than for men. Women in Massachusetts also had a labor participation rate 4.5% higher in 2021 than women nationally. While men in that age range accounted for 79,000 additional workers to the workforce, women added 105,000.

Among other findings in the report:

• As a higher rate of older individuals remained in the workforce, the number of 16- to 19-year-old workers fell by 40,000 between 2019 and 2021.

• The labor-participation rate among non-whites has been higher than among white workers in every year since 2018. Minorities accounted for 18% of the Massachusetts labor force in 2007, rising to 30% in 2021. The Massachusetts workforce is still less diverse than many other states, but it’s by far the most diverse in New England.

• In New England, Massachusetts ranked second behind New Hampshire with 62.1% of its total population employed in 2021. Previously, the Commonwealth also often ranked behind Connecticut and Vermont.

• Massachusetts saw a notable increase in the size of its workforce between 2016 and 2018 before shrinking during the pandemic. In 2018, the labor-force participation rate reached its highest level since 2007, and the workforce was still larger in 2021 than it had been in 2016.

Without policy intervention, serious structural challenges will remain for the Massachusetts labor force, the report notes. Like the rest of New England, Massachusetts has an older population and will struggle to maintain and grow its labor force as Baby Boomers continue to retire and less-populous younger generations attempt to fill the void they create. This, if left unattended, will create an employment desert. Employers finding it increasingly difficult to hire skilled candidates to fill positions will limit the state’s economic growth potential.

To address these issues, the report continues, the Healey administration and Beacon Hill lawmakers should consider three primary areas that are ripe for reforms and advocacy: expanding daycare capacity and affordability, expanding vocational-technical school programs, and advocating for less-strict high-skill immigration caps.

One of many issues that keep healthy, prime-aged adults sidelined from the labor force is concerns over childcare. Several studies have indicated that affordable childcare increases the number of hours worked by mothers and frees up parents to re-enter the labor force. Nationally, Massachusetts ranks below average in terms of available childcare. One study found that, in 2019, the state was likely more than 30% below demand in terms of available seats. This lack of supply has severely inflated prices; the average parent pays as much as $20,000 a year for an infant and $15,000 for a 4-year-old, ranking Massachusetts near the bottom of all states in affordability.

Separately, many workers remain sidelined as a result of a skills mismatch between them and employers. While there are nearly 300,000 job openings in the state, there remain 140,000 unemployed workers, a ratio of more than two open jobs for every unemployed person. This ratio has largely remained the same since 2021, despite millions of dollars spent on workforce training.

Lastly, and likely most consequentially, the state has suffered from diminished immigration levels due to overly restrictive federal immigration policies. Massachusetts relies heavily on immigrants, as the state would likely have seen significant net outmigration without inflows from immigrants over the last decade. Only recently has the state lost net residents — more than 110,000 since 2019 — due to pandemic-era restrictions on immigration and other compounding factors like remote work and an increased cost of living.

Senate Legislation Authorizing Chapter 90 Funding Should Benefit Rural Towns

By Contributor
Construction

Claiming Mileage

 

On March 30, the Massachusetts State Senate passed a bill that includes $350 million in bond authorizations for transportation needs across the state, including $200 million for the state’s Chapter 90 program, which provides municipalities with a reliable funding source for transportation-related improvements, including road and bridge repairs.

“This legislation will maintain and improve our state’s infrastructure, ensure that residents have safe and reliable transportation options, and support sustainable, regionally equitable economic development in communities across the Commonwealth,” Senate President Karen Spilka said.

The legislation also authorizes $150 million in programs that will assist municipalities with various transportation-related projects. This includes $25 million each for the municipal small-bridge program, the Complete Streets program, a bus-transit infrastructure program, grants to increase access to mass transit and commuter rail stations, grants for municipalities and regional transit authorities to purchase electric vehicles and the infrastructure needed to support them, and new funding dedicated to additional transportation support based on road mileage, which is particularly helpful for rural communities.

“Rural towns do not have large municipal budgets like some Commonwealth cities; yet, with much smaller municipal budgets, they have been expected to maintain many hundreds more miles of roads than their urban counterparts.”

“By dedicating a $25 million fund to rural communities for road and culvert work, the Senate has once again demonstrated a commitment to regional equity,” state Sen. Jo Comerford said. “Rural towns do not have large municipal budgets like some Commonwealth cities; yet, with much smaller municipal budgets, they have been expected to maintain many hundreds more miles of roads than their urban counterparts. They have culverts in need of repair and a significant number of gravel and dirt roads. This rural program recognizes and begins to address these pressing, inequitable realities for rural communities, and I’m deeply grateful.”

In arguing for the bill’s passing, Comerford made a passionate appeal for relief for communities in her district, which includes parts of Hampshire, Franklin, and Worcester counties.

“I know Boston didn’t have a lot of snow this winter. That was not the case in my district. Just over two weeks ago, a number of towns in my district received over 24 inches of snow, some getting as much as 38 inches just in one storm,” she said. “The Hatfield DPW director wrote that, ‘due to the late storms, we have a lot of roads that have fallen apart and a lot of tree damage. With the costs of asphalt rising and the Chapter 90 funding staying the same, we will never catch up.’ The Greenfield DPW director told us, ‘due to many freezes and thaw cycles, our roads have shown accelerated deterioration, and our pavement-management program is really in shambles.’

She said the base amount being provided to communities has been static for many years, while costs are constantly rising. “Weather events are getting more extreme, putting more stress on roads and bridges and cleanup, and rural municipalities have many dirt and gravel roads, making up more than 30% of a municipality’s road network, in some instances, in my district. And this, of course, is exacerbated by climate change, the erosion and the disrepair of these roads.”

She noted that the existing Chapter 90 formula used to distribute funds — established more than 50 years ago — takes into account road mileage, but also population and employment. “But this doesn’t work for the places that don’t have the people, but do have the miles and miles of roads. Adjusting the base Chapter 90 formula to put more emphasis on road mileage is something that I respectfully urge us to consider.”

State Sen. Paul Mark, who represents all of Berkshire County among some communities in Hampden, Hampshire, and Franklin counties, agreed that the mileage-based calculation will greatly benefit smaller towns.

“In a district of 57 cities and towns, 54 of which have populations of fewer than 10,000 people, and in some cases communities as small as 120 residents, we live first-hand every day how difficult it can be to undertake road repairs, invest in new equipment, or have our voice heard in Boston,” he said.

Legislators outside Western Mass. also praised the bill’s passage.

“Our transportation system is the backbone of our Commonwealth, connecting us to our jobs, families, and communities,” said state Sen. Brendan Crighton, chair of the Senate Committee on Transportation. “This investment is not just an investment in infrastructure, but an investment in the future of our Commonwealth, enabling our cities and towns to make the necessary improvements to promote efficient and safe travel for all.”

State Sen. Edward Kennedy, chair of the Senate Committee on Bonding, Capital Expenditures, and State Assets, added that “I’m pleased to see this crucial investment in the Commonwealth’s roads and bridges move toward fruition. The cities and towns of Massachusetts depend on this necessary funding to maintain their transportation infrastructure.”

A different version of the bill having previously been passed in the House of Representatives, the two chambers will now reconcile differences before sending the bill to Gov. Maura Healey’s desk.

What Employers Need to Know About Workers’ Compensation

By Contributor
Insurance

Avoiding a World of Hurt

By Encharter Insurance

 

If you are an employer in Massachusetts with one or more employees, workers’ compensation is a mandatory business-insurance coverage. An employer may be an individual, a partnership, a corporation, or any other form of ownership that has employees. Failure to carry workers’ compensation coverage can result in an immediate stop work order and fines for every day that no coverage was available.

Besides being the law, here’s why you need it: workers’ compensation is essentially a no-fault system designed to protect both employers and employees should a workplace injury or illness occur. Your workers’ comp insurance policy would cover payment for medical care related to the employee’s injury, and would pay wage-replacement benefits, also called indemnity payments. In exchange for these benefits, workers’ comp, rather than the courtroom, becomes the employee’s exclusive remedy.

Individual states have jurisdiction over their own systems, so specific regulations and benefits vary by state. In Massachusetts, the Department of Industrial Accidents (DIA) manages the workers’ compensation system, adjudicating any disputes or appeals that arise. Meanwhile, the Massachusetts Workers Compensation Rating and Inspection Bureau sets rates.

 

How Is Coverage Obtained?

Most employers secure their workers’ compensation from an insurance agent. Large employers sometimes self-insure but must pass several regulatory gating issues to qualify for self-insurance.

If two or more insurance companies decline to insure your organization, you may have to seek coverage in the Massachusetts residual market, also known as an assigned risk pool.

Workers’ compensation insurance can be canceled by the insurance company, but only for the reasons of non-payment of premium, fraud or material misrepresentation, or a substantial increase in the hazard being insured. Your insurance company would need to notify you of cancellation with 10 days written notice.

 

How Are Rates Set?

The cost of the insurance is based on anticipated loss experience and is comprised of two basic components.

Under manual premium, the cost for your workers’ compensation policy is determined by your payroll and the classification of the work your employees do. The riskier the work, the higher the rate for the class code. There are thousands of class codes set by the Workers Compensation Rating & Inspection Bureau (WCRIB) in Massachusetts.

Under modified premium, once you have purchased workers’ compensation for two years, if the sum of the premiums for two years is $11,000 or more, your policy will be subject to experience rating. Manual premium is multiplied by an experience rating factor (or ‘e-mod’) reflecting your specific organization’s loss history. Much like the experience rating system used by many states to develop auto insurance rates, a bad year will impact an employer for years to come, as three prior years’ experience are used to develop a workers’ compensation e-mod.

 

What Benefits Does Workers’ Comp Provide to an Injured Worker?

Workers’ compensation coverage provides unlimited medical expenses, lost wages (also referred to as wage replacement or indemnity), rehabilitation expenses, and dependent and funeral expenses up to a state’s limits

The amount and duration of wage replacement and medical benefits varies based on each state’s law. Generally, the injured worker faces no out-of-pocket medical costs.

 

What Are Your Responsibilities as an Employer?

• Obtain workers’ compensation insurance coverage. Failure to carry coverage can result in stop-work orders and daily fines for the uncovered duration.

• Show proof of that coverage by posting notice in a public and visible place that all employees use.

• Provide a safe workplace, as required by OSHA.

• If an employee is injured, send them for medical care. In Massachusetts, you have the option to choose the physician for the first appointment.

• Report a medical-only injury (one with no anticipated lost time) to your insurer.

• Report a workplace injury with five or more days of absence, or a death, to the Massachusetts Division of Insurance.

 

What Are Some Best Practices to
Minimize Costs?

You can lower your workers’ comp costs by working to the lowest possible e-mod. There are two variables that you should work to control: the frequency of injuries, or how many work-related incidents occur; and the severity of workplace injuries, or the duration of time away from work. Here are best practices to help control both and to help you attain the lowest possible experience e-mod:

• Maintain a safe and healthy workplace. The least costly injuries are the ones that never happen. Control frequency by setting the expectation for an injury-free workplace, training employees to work safely, requiring personal protective equipment, and conducting periodic walk-through audits. Your insurance company can often provide safety resources.

• Have a plan for point-of-injury response. A quick, caring, non-judgmental response to a work injury will help to set the trajectory for a positive outcome for all. Ensure that employees and managers know what to do if an injury occurs. Escort the injured worker to medical treatment.

• Partner with a nearby occupational doctor or medical clinic. Massachusetts allows employers to choose the first medical contact. Choose a top-quality physician or a clinic experienced in workplace injuries. Your insurance company may have a good network.

• Report injuries to your insurer in a timely manner. Early reporting is extremely important — numerous studies have demonstrated that the sooner injuries are reported, the better the outcome. Aim for same-day reporting.

• Prepare for return to work. It’s important to get employees back to work and on the team as soon as possible to help prevent disability syndrome. Plan for a transitional or modified job duties to help the employ re-acclimate and work-harden to their regular job.

A Step in the Right Direction

By
Opinion

Editorial

 

Gov. Maura Healey presented her first budget a few weeks back, and it contains some proposals that could help the state navigate its way out of an ongoing workforce crisis.

Chief among them is something called MassReconnect, which would fund free community-college certificates and degrees to Commonwealth residents who are 25 years and older and have not yet earned a college degree.

Based on initiatives in Michigan and Tennessee, MassReconnect actually goes further than those programs by covering more than just tuition; it also covers mandatory fees, books, and various support services. It is designed to remove barriers to getting the college degree that is needed to succeed in most jobs today, and it holds significant promise to do just that.

So do some of Healey’s other proposed investments in higher education, including a 3% increase in public college and university base spending, as well as $59 million to stabilize tuition and fees at the University of Massachusetts and other public institutions.

But it is free community college that is getting the most attention, and rightfully so. In fact, Senate President Karen Spilka has been working on legislation to achieve just that, saying that reducing the cost of getting a degree will help close equity gaps and build a more educated workforce to meet the needs of important industries in Massachusetts..

Indeed, while the bottom-line cost of a community-college education is much lower than at four-year schools, it is still a burden to many and a roadblock when it comes to attaining not just a job, but a career. In that sense, this proposal could open doors to individuals who have seen them closed for one reason or another, while holding considerable potential to bolster the state’s 15 community colleges and the state’s economy as a whole.

Indeed, the Commonwealth’s community colleges, long considered a key component in any region’s economic-development strategy, and especially here in Western Mass., have been struggling of late, and for many reasons.

Smaller high-school graduating classes are just one of them. A strong job market has traditionally had the effect of impacting enrollment at community colleges — they thrived during the Great Recession, for example — and that pattern has held for roughly the past decade or so. Meanwhile, the pandemic certainly hasn’t helped.

This region needs its four community colleges — Berkshire Community College, Greenfield Community College, Holyoke Community College, and Springfield Technical Community College — and it needs them to be strong and vibrant if it is to create, and maintain, a strong pipeline of workers coming into fields ranging from healthcare to cannabis to hospitality.

Meanwhile, community college serves as a place to start one’s secondary education. Many graduates of these schools move on to four-year colleges and degrees that lead to a wider range of job, and career, possibilities. But first, students need to begin.

That’s why this proposal holds such potential. It is designed for non-traditional students, those who haven’t started in college, or who have started but haven’t completed, for one reason or another. These are the individuals who hold the most promise for bringing some real relief to the region’s ongoing workforce crisis, one that is impacting businesses in every sector of the economy.

The concept of free community college has its skeptics, and some will wonder where the money will come from and whether the state can afford to do this.

Looking at matters from an economic-development lens, however, one could argue that the state can’t afford not to do it.

 

Celebrating 150 Years

By
Holyoke’s canals gave the city water power — and an identity.
Community Spotlight Cover Story Features

The Paper City Looks Back — and Ahead

Holyoke City Hall

Go just about anywhere in the Paper City — City Hall offices, manufacturing facilities, the local utility, restaurants, some cannabis dispensaries, anywhere — and you will find pictures of what would be called ‘old Holyoke.’ And some images of the new Holyoke as well.

They’re everywhere. Pictures of the old but still-standing mills, the canals, Mount Tom, High Street in a different age, the Hadley Falls Dam, and especially City Hall, the iconic Gothic Revival structure built in 1871 that is, in many ways, the symbol of this historic city.

These pictures you see everywhere are visible evidence of the enormous pride people from this city, or now doing business in it, take in Holyoke.

You see this this pride in every community in Western Mass., from the small towns in Franklin County to the capital of the region, Springfield. But in Holyoke, it’s … well, different. And it just seems like there is more of it.

This much is made clear in the stories that follow in this special section commemorating the city’s 150th birthday. People from Holyoke take a special pride in being from their city, and for many reasons.

There is history — this is the country’s first planned industrial city. There is architecture. There are landmarks. There are institutions. There is tremendous diversity. There is the St. Patrick’s Day Parade and Road Race. Mostly, though, there are people — those who lived a century and more ago, and those who call it home today.

As the city turns 150, there is much to celebrate, and certainly not all of it is in the past, although the past is what many people like to focus on.

There was a time when Holyoke was a model industrial city producing some of the finest papers and textiles in the world. The mills producing these products created thousands of jobs, enormous wealth, and tremendous prosperity.

The city’s fortunes changed, obviously, as these mills closed or moved south or overseas starting just after World War II. For decades, the city was in decline, even as it remained a center of jobs and manufacturing.

Today, there is a sense of revitalization and vibrancy, with new leadership, especially Joshua Garcia, the city’s first Hispanic mayor, and an economy that is far more diverse and fueled by everything from a surging creative-arts sector to a cannabis industry that found in Holyoke a welcome mat, millions of square feet of old mill space perfect for cultivation and even dispensaries, and inexpensive, green energy.

Another factor powering this revitalization is entrepreneurship. Through the efforts of EforAll, the Greater Holyoke Chamber of Commerce, Holyoke Community College, and other agents of change, Holyoke residents, and especially those making up the minority majority, are creating new businesses, from restaurants to dance studios to fabric shops, that are changing the face of High Street — and the entire city.

These stories and many others are told in the pages that follow. Together, they tell of a city with momentum. A city with vision. A city with renewed optimism about what can be done when people work collaboratively. A city that has a lot to celebrate.

 

Holyoke. Wanna Make Something of It?

By Darby O’Brien

 

Unless you’re from Holyoke, you probably won’t get it.

We’re a little like Southie on the other side of the state. Hardscrabble Holyokers have grit and never quit. Holyoke is a city with soul. It’s a city of neighborhoods. Churchill, Elmwood, the Flats, the Highlands, Oakdale, and Springdale. As Liberty Bank President and Holyoker Dave Glidden says, “you can take the kid out of Holyoke, but you can’t take Holyoke out of the kid.”

Just look at the cast of characters that came out of this place. Start with the famous drummers. Hal Blaine, a Rock & Roll Hall of Famer, played with the legendary Wrecking Crew on 40 number-one hits, and Ronnie Hurst played in Steppenwolf. Holyokers Michael and John Shea wrote the Notre Dame fight song. We have Emmy-winning actress Ann Dowd. Alan Eisenstock was a writer and producer on shows like Mork and Mindy, Sanford and Son, and Family Matters. My nephew, Lenny Jacobson, is another one you’ve seen on the tube, from big-time TV spots to shows like Nurse Jackie, and he just won the 2023 JFK Award.

We’ve also got Neil Sheehan, the New York Times writer who released the Pentagon Papers and won a Pulitzer Prize for his book A Bright Shining Lie, considered to be one of the best books about the Vietnam War. Mitch Epstein is a world-renowned photographer. Frank Leja, who lived down the street from me as a kid, signed as a ‘bonus baby’ with the New York Yankees at 17. To this day, he’s the youngest player ever to appear in the pinstripes. The list goes on. Maybe it’s in the water. We’ve got four reservoirs. They’re all closed for fishing now, but we sneak in and cast a line anyway.

Another thing unique to Holyoke is the game of Pickie. We invented the game in the streets and alleys downtown. Just saw off your mother’s broom for a bat, and grab some Pee Gee balls, and you’re set. It’s always been a sports town. Betsy Frey carries on the family business at Holyoke Sporting Goods, probably one of the last independent sporting-goods stores left. Part of what keeps it going is the boatload of Holyoke merchandise she sells in the store, especially around parade time. You’ve heard about Holyoke’s St. Patrick’s Day parade, right? One of the biggest in the country.

The late “Made in Holyoke” rapper Justin Chavez said, “it’s a city full of pride and hope, a city that’s alive.” My old buddy John Hickey, who was the Water and Power chief, coined the slogan “Holyoke. Best City by a Dam Site.”

Damn right.

 

Darby O’Brien, a Holyoke native, is the owner of the marketing and public relations firm Darby O’Brien Advertising in South Hadley.

Holyoke Then and Now

By
Holyoke’s rich industrial past, one that earned it the nickname ‘Paper City.’
Features Picture This

Photos Past and Present

Holyoke’s rich industrial past, one that earned it the nickname ‘Paper City.’

Holyoke’s rich industrial past, one that earned it the nickname ‘Paper City.’

Old Holyoke Dam

Mountain Park

A view of Mountain Park, the popular amusement park that closed its doors in 1987.

 

Holyoke’s canals gave the city water power — and an identity.

Holyoke’s canals gave the city water power — and an identity.

 

City Hall has become a symbol of Holyoke.

City Hall has become a symbol of Holyoke.

 

One of the horses from the carousel

One of the horses from the carousel at Mountain Park, later moved to Heritage State Park, where it has become a popular attraction.

 

An aerial shot of Holyoke, one of its canals

An aerial shot of Holyoke, one of its canals, and one of its many distinctive mills.

 

The Massachusetts Green High Performance Computing Center

The Massachusetts Green High Performance Computing Center is part of a new era for Holyoke’s business community.

 

This mural created by the artist known as BORDALO II

This mural at 44 Clemente St., created by the artist known as BORDALO II, is part of the Beyond Walls initiative that has changed the landscape in downtown Holyoke and beyond.

 

Holyoke Sees Surge in Entrepreneurship, Business Diversity

By
Brothers Juan (left) and Gilberto Uribe
Features

Getting Down to Business

Brothers Juan (left) and Gilberto Uribe

Brothers Juan (left) and Gilberto Uribe are co-owners of El Paraiso Colombiano restaurant, a true family affair that has found a home on High Street.

Juan Uribe calls it a “family dream.”

He was referring to El Paraiso Colombiano restaurant, an entrepreneurial gambit that is truly a family affair.

Indeed, Juan and his brother, Gilberto, are co-owners and also cook and tend bar. Their father is head chef, and their sister is a waitress. Together, they created and now operate what they believe to be the only Colombian restaurant between here and Hartford, one that opened in the middle of the pandemic, but quickly found its stride nonetheless.

“On grand-opening day, there was a line outside to the corner,” said Juan, adding that, while there have been plenty of challenges with this venture, it has been a huge success to date, drawing patrons from around the block but also across the region and even beyond. “We thought people would come out and support something new, and they have.”

Juan, Gilberto, and other members of the Uribe family are now part of a changing scene on High Street, one of several ‘main’ streets in this city, and also part of an ongoing surge in entrepreneurship that is changing the face of the local business community.

Indeed, where once this city was dominated by large mills that covered several blocks of real estate, it is now marked increasingly by smaller ventures that occupy a storefront or even a desk or cubicle in the incubator space at the EforAll offices, also on High Street.

Jeff Cattell and Joseph Charles are also part of this changing scene. Business and life partners, they launched Paper City Fabrics, a supplier of a wide variety of fine fabrics, in September 2021, and have taken it from an online operation to a storefront on High Street that was most recently home to a law firm. They are completing renovations now and expect to open in the spring.

“Our goal has always been to open a brick-and-mortar storefront,” said Cattell, adding that he and Charles moved to the city four years ago and, after considering several business options, settled on a thrift-store model in what he called the “fiber-arts realm.”

Elaborating, he said the store will accept donations of fabric, everything from cotton to silk, as well as sewing machines and other goods and equipment, and sell them at steep discounts, thus bringing another unique concept to downtown Holyoke and one that speaks to its storied past in many respects.

Paper City Fabrics, El Paraiso Colombiano, and many other new businesses on High Street and beyond, from City Sports Bar to the Artery, a pop-up shop, to Star Dancers Unity (see story on page 50), are, indeed, part of a wave of entrepreneurship in the city, said Jordan Hart, executive director of the Greater Holyoke Chamber of Commerce.

“There’s a lot of old players in Holyoke — there are many established businesses in many sectors, including manufacturing, which has traditionally been our foundation,” she explained. “But we’re seeing a lot of young, new faces as well, people who are investing in our downtown.”

Tessa Murphy-Romboletti, executive director of EforAll Holyoke and its Spanish equivalent, EparaTodos — an agency that is fueling this wave through accelerator programs, pitch contests, virtual workshops, co-working space, and more — agreed.

She said that the chamber, EforAll, and programs like the Transformative District Initiative, which are funneling dollars into storefront-improvement efforts and other programs, are helping people launch new businesses and then weather the many challenges they will face.

Tessa Murphy-Romboletti (left) and Jordan Hart

Tessa Murphy-Romboletti (left) and Jordan Hart say a surge in entrepreneurship has helped Holyoke’s business community become as diverse as the city itself.

These efforts are also making Holyoke’s business community much more diverse, said both Jordan and Murphy-Romboletti, noting that it looks much like the city itself, with many Hispanics and other minority groups taking on risks and putting their names (figuratively and, in some cases, literally) over the door of buildings on High Street and many other roads.

“Holyoke is such a diverse community, and I think we’re both trying to make sure that our business community reflects our community at large,” said Murphy-Romboletti, who is also an at-large city councilor in Holyoke. “That’s one of the great things about the Holyoke chamber now — you go to one of its monthly networking events, and it looks like the community of Holyoke; it’s very diverse, and Jordan has created a very welcoming environment.”

 

Food for Thought

Juan Uribe was driving a truck when he and other members of his family decided to pool their talents and resources and open El Paraiso Colombiano.

And he still drives a truck in the morning and sometimes during the day depending on how business it is at the restaurant, because … well, because he needs two jobs at this stage in his life, especially as the restaurant continues to emerge and build its brand.

But, like other members of his family, Uribe desired to be in business for himself, and with some encouragement and learning while doing from EforAll, the dream became a reality.

Like many such ventures, it started with a passion that would become a business.

“We were born and raised here in Holyoke, and friends would come around; we’d have little events — my grandmother would make empanadas, and my father would cook, my mother would cook, everyone would just love to be in our house,” he recalled. “So we decided to make it a business; we all love to cook, and this is a family business.”

A restaurant operating at 351 High St. had to shut down because of COVID, he went on, adding that, while the timing may not have been perfect for launching a new eatery, the family took the plunge.

Joseph Charles, left, and Jeff Cattell

Joseph Charles, left, and Jeff Cattell, owners of Paper City Fabrics, are part of a changing scene on High Street.
Staff Photos

“We knew we had a good idea going, so we decided to take everything we had and move ahead,” he said. “We knew that, even though there was a pandemic, people still had to eat, and we thought they would come out and support something new.”

That’s the quick version of the story, he said, adding that many pieces to the puzzle had to come together, obviously, as well as a business plan for bringing that ‘something new’ — authentic Colombian cuisine — to Holyoke and the region.

And the learning while doing continues, he said, adding that working for himself is “a lot of work, but it’s something that I love, something that my brother loves. It’s challenging, and it’s hard, but it doesn’t get any better than this.”

Cattell and Charles offered similar sentiments and similar excitement when it comes to being part of the scene on High Street, which is the logical next step for their venture.

“Shopping for fabric is a tactile experience,” Charles said. “Touching and seeing the colors in person and the textures of the fabric is an important part of the buying process.”

The two had been looking for a storefront for more than a year and eventually settled on 330 High St., across the road from El Paraiso Colombiano, a location that affords them the space they need for their retail operation as well as to process donations and create a classroom for sewing lessons. The space has some history — it was once a popular lunch counter — and some intriguing features, such as tin ceilings and a mosaic tile floor that was hidden by carpeting.

“It’s really cool to be able to restore some of that historical perspective,” said Cattell, adding that it’s also cool to be part of a changing dynamic in downtown Holyoke, which is seeing new businesses across many sectors.

Meanwhile, the chamber, EforAll, and other agencies, such as Nuestras Raices, a grassroots urban-agriculture organization, are working collectively to not only create a pipeline of new businesses like these, but help those businesses survive, thrive, and get to the proverbial next level.

For example, EforAll has, in addition to accelerator programs, a number of virtual programs it calls Deep Dives.

In recent months, such dives have been taken into subjects ranging from “Making It in the Food Business” to “Are You Getting All You Can Out of QuickBooks?” to “How to Use LinkedIn to Grow Your Small Business.”

Meanwhile, the chamber, through its many networking programs, is enabling these new small businesses to make the connections they need to grow their portfolios, while also learning from others facing the same challenges.

Indeed, Jordan told BusinessWest that the chamber has an attractive rate for solopreneurs and small businesses, enabling these ventures to be part of a full slate of events that provide invaluable opportunities to not only hand out business cards but also be an active part of a growing, more diverse business community.

Murphy-Romboletti agreed.

“The chamber has created a very welcoming environment, especially for my entrepreneurs who are not familiar with networking and are often so focused on being in the business and not necessarily working on the business,” she explained. “I think the chamber creates this environment where people can step away from the cash register or step away from the kitchen and connect with the community and build those relationships so they can be successful and really be part of the community; that’s been really valuable.”

In addition to helping individuals start a business and move it to the next level, agencies like the chamber and EforAll are working to get them involved in the community and take ownership of efforts to revitalize High Street and, overall, improve the landscape for business in the city.

“Whether it’s a new business or a business that’s been around for decades, we want them to feel like they have the ability to make change and advocate for what they want,” Murphy-Romboletti said. “We’re really being intentional about creating these spaces for them.”

Uribe said that getting involved in the community has been not just part of the business plan, but something important for the family.

Indeed, they are part of the many festivals that place in the city, and Uribe is the founder of the Paper City Food Festival, which staged its second edition last fall on the section of High Street between Appleton and Dwight streets, attracting more than 20 of the city’s restaurants.

“It’s a way for people to come out and see all that this city has to offer,” he told BusinessWest, adding that he engaged the chamber and started the festival to uplift local businesses and celebrate the community’s heritage and diversity.

 

Bottom Line

There was much to celebrate at last October’s food festival, and, similarly, there is much to celebrate with this city’s business community as it turns 150.

There is diversity. There is change. There is vibrancy. And, overall, there is a wider pipeline of new businesses, entrepreneurs like the Uribe family and Jeff Cattell and Joseph Charles.

Together, they are not just filling storefronts on High Street. They are energizing a city and writing an intriguing new chapter in its long and distinguished business history.

 

Holyoke’s History Is One of Adaptation, Evolution, and Water

By
Features

Going with the Flow

By Joseph Bednar

bednar@ BusinessWest.com

Old Holyoke Dam

The city of Holyoke’s website details a series of telegrams sent by one James Mills on Nov. 6, 1848 to a group of industrialists in Boston who had invested in the first dam at South Hadley Falls and were eager to hear of its performance.

“The gates were closed and the water filling behind the dam,” Mills reported at 10 a.m. It would be his only happy missive.

Noon: “Dam leaking badly.”

1 p.m.: “Leaks cannot be stopped.”

2 p.m.: “Bulkheads are giving way.”

3:20 p.m.: “Dam gone to hell by way of Willimansett.”

So, it wasn’t the most auspicious way to begin Holyoke’s new direction as a planned industrial city that harnessed the power of the Connecticut River.

But the builders learned from their mistakes — and built a replacement dam. Like the first, it was also made of wood and completed the following summer. This dam still stands, 150 feet underwater, behind the current, modern stone dam that was put into service in 1900.

This bit of history is just one example of Holyoke not only overcoming challenges, but evolving with them along a winding, intriguing, still-evolving story.

The story actually begins much earlier, with the Indigenous tribes who settled there on the rich, alluvial plain, including the Nonotucks, from whom early European settlers eventually purchased the land that would be incorporated into the future boundaries of Holyoke.

Captain Elizur Holyoke is believed to be the first European to explore the future city. In 1633, he led an expedition up the Connecticut River to explore the potential for settlement. Two years later, based upon his report, European agriculture settlement began in the region. Initially concentrated in Springfield, settlers soon began to migrate to the surrounding areas that would later become West Springfield, Chicopee, and Holyoke. Holyoke was then known as Ireland Parish, a name that would remain in common use until 1850.

When Boston investors saw in the parish industrial potential similar to Lawrence and Lowell — and the energy potential of the river — they set out to create an industrial city on a large scale.

In 1847, taking advantage of the broad plain and the 57-foot drop in the Connecticut River at South Hadley Falls, work began on the planned industrial city. Canals, mills, boarding houses, offices, and a dam were all built by pick and shovel. And on March 4, 1850, Holyoke — with its working dam — was finally separated from West Springfield and designated its own town.

“There was some resistance from the farmers who initially didn’t want to sell their land,” said Penni Martorell, Holyoke’s city historian and curator of Wistariahurst. “But eventually [the investors] won out. They just bought the land and then laid out the plan for the city. The flats area was definitely the working man’s area. The middle area around the canals was where the factories were built, and then the highlands were set aside for retail businesses and homes of the wealthier families.”

 

Strength in Paper

Before the planned-city idea got rolling, Holyoke was mainly an agricultural community with a sprinkling of industry, including a lumber mill on the river.

“The investors had had success in Lawrence, in getting mills set up along the river up there. And then they were like, ‘well, where else can we go?’” Martorell told BusinessWest. “Lawrence and Lowell often lay claim to being the first planned industrial cities. We say they worked it out there, and then they perfected it here in Holyoke. They really took advantage of the 60-foot drop in the river, how to harness that energy and then send it through the canals.”

Holyoke’s development was rapid, with its population surging from about 3,200 in 1850 to 45,000 by the turn of the century and more than 60,000 at its peak in the early 1920s. Textiles were the first major product of the city, quickly followed by paper, which became the dominant force in the city. At one time, more than 25 paper mills were in operation.

By 1885, 12 years after its official designation as a city, Holyoke was the largest single producer of paper of any city in the U.S., producing around 190 tons per day, more than double the next-largest producer, Philadelphia, which produced 69 tons per day despite having a population nearly 40 times its size. By 1900, Holyoke would produce about 320 tons per day, predominantly writing paper, led by American Pad & Paper Co., American Writing Paper Co., and others.

Holyoke also built schools, churches, parks, and many public buildings, including the historic City Hall (see story on page 28). By the turn of the century, Holyoke exerted considerable influence on American life. The Holyoke Opera House was the test location for Broadway plays before moving on to New York. The Easter parade here drew as many spectators as on Fifth Avenue.

A number of industrial inventions arose out of the city in the late 19th and early 20th centuries. The first and most prominent hydraulic testing lab in the U.S., Holyoke Testing Flume, performed 3,176 tests to establish turbine efficiency from 1870 to 1932. Other pioneering developments included the first use of Hans Goldschmidt’s exothermic welding process in the Americas in 1904, by George Pellissier and the Holyoke Street Railway. In electronics, the world’s first commercial toll line, between the city’s Hotel Jess and a location in Springfield, entered service in 1878. Holyoke was also home to Thaddeus Cahill’s New England Electric Music Co., which, in 1906, demonstrated the telharmonium, the world’s first electromechanical instrument, a predecessor of the synthesizer.

Meanwhile, the availability of water power enabled Holyoke to support its own electric utility company and maintain it independently of America’s major regional utilities. The city was thus a rare unaffected area in the Northeast blackout of 1965.

But the city’s second century has been a complicated story, Martorell said.

“It was boom and bust. So every time there was a bust, the wealthier people were able to prepare for that. But the lower-income people were not able to prepare. They would move on to wherever there was work. So it was a bit of transience at certain points. The paper industry kind of morphed into other industrial spaces.”

 

Northern Migration

Beginning at the end of World War II, the city’s demographics began to change, as an influx of Puerto Ricans and other Latino groups began to migrate to the Northeast U.S., driven largely by the Farm Labor Program initiated by the U.S. Department of Labor, which recruited Puerto Rican laborers to work on agricultural land; in the case of Holyoke, many worked on tobacco farms and arrived in the city in search of better job opportunities at the mills, as previous generations had.

“In Springfield and Holyoke, housing was inexpensive, you had access to 91 and 95, and a lot of them had an agricultural background and were looking for farm work,” Martorell said of the Puerto Rican influx. “So between Hatfield and the tobacco fields along the Connecticut River, they were able to find work pretty quickly once they got here.”

By 1970, the number of Puerto Rican residents numbered around 5,000; however, by that time, many faced a city economy that was struggling. Holyoke’s mills had closed due to the changing economic landscape of early globalization and deindustrialization; from 1955 to 1970, half of all industrial jobs vanished. Despite economic and social difficulties, however, the population grew significantly, and today Latinos form the city’s largest minority group, with the largest Puerto Rican population per capita of any American city outside Puerto Rico proper, at 44.7%.

As for those old industrial buildings, their use is evolving.

“The Skinners, who made silk, sold their company to Indian Head Mills, which was a conglomerate going around buying up textile mills in the late 1950s or early 1960s. They bought the company and then shut it down a few years later,” Martorell said. “And many of the other paper companies had already gone out. Parsons Paper was the first paper company in Holyoke, and they closed their doors in 2005. So that was a pretty good run.”

A few specialty paper and printing companies remain, but today, many of the old mills along the canals are being repurposed, from cannabis cultivation, manufacturing, and retail operations to the entertainment venue known as Gateway City Arts.

Martorell said change has been a constant in Holyoke, but so has a feeling of promise.

“People in Holyoke love Holyoke. People are committed to being here, and they want to see good things happen for the city,” she told BusinessWest. “And I think the last two mayors have really tried to make an effort to rebrand the city in a more positive way and say that the challenges that we’ve had in the past have made us stronger and more diverse. So we embrace that and celebrate that.”

 

Some information for this article was adapted from the city of Holyoke’s written history and from Wikipedia.

Losing More Than Population

By
Opinion

Editorial

 

The numbers are alarming — on many levels.

From July 2021 to July 2022, more than 57,000 more people moved out of the state than into it, one of the highest rates of what is being called ‘domestic outmigration’ in the country. And if you go back to April 2020, the number soars beyond 110,000.

That’s a lot of people who decided they couldn’t make it in Massachusetts anymore, or didn’t want to try. And these numbers should get everyone’s attention, because these departures are not good for individual cities and towns, or for the Commonwealth’s technology-driven economy.

It’s enough of a problem that Gov. Maura Healey made it one of the focal points of her inaugural address last month, stating “this is greatest state in the union, but people are leaving at some of the highest rates in the country — giving up on the Massachusetts story.”

It’s possible that some people are giving up because of the cold (and we don’t even have as much of that as we used to), or the traffic (in the Boston area), or the decidedly liberal nature of the State House, or even the ‘millionare’s tax.’ This might explain why more than 20,000 of those who have left have moved to New Hampshire, where taxes are much lower and elected leaders are much more conservative.

But it seems clear that most are leaving because they simply can’t afford to live here anymore.

That’s especially true in the eastern part of the state, where taxes are sky-high, home prices are through the roof, and other costs, including childcare, are becoming increasingly prohibitive.

“Affordability in Massachusetts has dropped dramatically,” Nadia Evangelou, senior economist for the National Assoc. of Realtors, told the Boston Globe recently.

We have a few thoughts on this problem. First, state leaders need to do something to address the housing problem here. The term ‘affordable housing’ has a shifting definition in Massachusetts and other states where there are plentiful, attractive jobs, but however it is defined, the state simply needs to create more of it. If it doesn’t, more people will leave or, in the case of graduating college students, settle somewhere else.

In the meantime, economic-development leaders in Western Mass. should double down on their efforts to try to convince people that if they want to escape the high prices (if not the cold), they don’t have to leave the state; they just have to look west of Worcester.

Indeed, while some communities in this part of the state are expensive, most are quite reasonable. And there isn’t nearly as much traffic. And the costs of childcare are considerably lower. And with the advent of remote work, you can have all of this and still work for IT and financial-services companies based in Boston or Cambridge.

Those of us Western Mass. know all this, and most people living in Newton, Wellesley, or Lexington know as well, but it wouldn’t hurt for this region to market itself more aggressively, especially in the eastern part of the state.

Doing so would benefit not only the Western Mass. region, where many communities have lost population and professionals of all kinds are needed, but the state as well.

Indeed, until ways can be found to somehow make this state, and especially the Boston area, more affordable, we need to focus on ways to inspire people to move from one end of the state to the other, instead of out of it altogether.

Employment-law Roundup

By Contributor
Law

Five Important Things to Know Going into 2023

By Amelia J. Holstrom, Esq. and John S. Gannon, Esq.

 

Massachusetts employers are used to the ever-changing employment-law landscape. As we close out another year and ring in a new one, it is clear that 2023 will bring new challenges and new requirements for employers throughout the Commonwealth.

AMelia Holstrom

Amelia Holstrom

John Gannon

John Gannon

We’ve rounded up the top five things employers need to know and keep an eye on as we turn the page to 2023.

 

Decision on Micro-units May Be Troubling for Employers

When a union attempts to organize a group of employees at a business, it files a representation petition with the National Labor Relations Board (NLRB), identifying the proposed bargaining unit, which is the group of employees the union seeks to represent and who will be eligible to vote on whether it gets to do so. Sometimes, employers will seek to add additional employees to the union’s proposed bargaining unit, as larger proposed bargaining units may be favorable for employers in representation elections.

In a recent decision, American Steel Construction, the NLRB, which interprets and enforces the National Labor Relations Act (NLRA), gave a powerful tool to unions by clearing the way for small bargaining units, often called ‘micro-units.’ Specifically, the board decided that it will approve a smaller subdivision of employees as a bargaining unit if they meet certain criteria.

Under this standard, unions are likely to be very successful in getting the NLRB to approve micro-units. As a result, employers are placed at risk of having to bargain with several small units of employees in one workplace.

 

NLRB to Surveil Employers’ Surveillance Measures

Businesses regularly monitor employees in the workplace. For example, employers may monitor telephone calls for quality-assurance purposes, install cameras in the workplace or dashcam systems in vehicles, or monitor communications sent and received on employer-owned devices. Such monitoring appears be under attack by the NLRB.

In early November 2022, the general counsel of the NLRB issued a memorandum regarding employee surveillance, in which she urges the NLRB to adopt a “new framework” for determining whether employer surveillance violates the law. Under this framework, violations may occur when the surveillance would tend to interfere with an employee’s rights under the NLRA or “prevent a reasonable employee from engaging” in activity protected by the NLRA.

“In a recent decision, American Steel Construction, the NLRB, which interprets and enforces the National Labor Relations Act (NLRA), gave a powerful tool to unions by clearing the way for small bargaining units, often called ‘micro-units.’.”

This could involve employee surveillance of suspected organizing activity. The employer will then get the opportunity to explain their legitimate, business-based reasons for the surveillance. At that point, the new proposed framework would require the NLRB to weigh the employer’s business needs for the surveillance against the rights afforded to employees under the NLRA. If the NLRB determines that the employer’s reasons outweigh the rights of employees, the NLRB will require the employer to disclose all electronic monitoring, the reasons for doing so, and how the employer uses the information it obtains. This crackdown on employee surveillance impacts unionized and non-unionized workplaces alike.

 

Update That Handbook for New Protected Characteristics

Massachusetts law prohibits employers from discriminating against employees based on a number of protected characteristics, including but not limited to race, color, sexual orientation, and gender identity. Effective Oct. 24, 2022, Massachusetts added natural and protective hairstyles to the list of protected characteristics under the law.

Accordingly, employers need to update their handbooks and other policies to reflect the additions. Your handbook should also include language on many other employment laws, including the state Paid Family and Medical Leave Act.

 

Changes to Paid Family and Medical Leave

Speaking of the Massachusetts Paid Family and Medical Leave Act, last month the Department of Family and Medical Leave released updated model notices reflecting new contribution rates effective January 1, 2023. If you have not already done so, those new notices need to be distributed to your entire workforce as soon as possible. Employers should also ensure that their payroll providers are planning to implement this change.

The department also updated the mandatory PFML workplace poster, which should be posted in a location where it can be easily read by your workforce. The poster must be available in English and each language which is the primary language of five or more individuals in your workforce, if these translations are available from the department.

The department is also considering changes to the PFML regulations intended to clarify employer obligations to maintain employment-related health-insurance benefits while employees are out on leave. Stay tuned in 2023 for developments on these proposed regulations.

 

Speak Out Act Requires Changes to Employment Agreements

On Dec. 7, 2022, President Biden signed the Speak Out Act into law (see story on page 27). The new law prohibits employers from including non-disclosure and non-disparagement provisions applicable to sexual-assault and sexual-harassment allegations and claims in agreements executed before the allegation or claim arises. It does not impact agreements with those provisions entered into after such a claim arises.

Although it may seem insignificant because it only applies to pre-dispute agreements, employers need to carefully review their confidentiality, employment, and other agreements executed by employees and ensure that the non-disclosure and non-disparagement paragraphs in those agreements do not prohibit the employee from disclosing or discussing sexual-assault or sexual-harassment allegations or claims. Employers would be prudent to include language carving out those claims.

Businesses are encouraged to continue to consult with counsel regarding these changes in labor and employment laws. The team at Skoler Abbott also wishes readers a happy and prosperous new year.

 

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

Meg Sanders Infuses Energy, Innovation into Canna Provisions

By
Meg Sanders
Cover Story Women in Businesss

Grass-roots Effort

 

‘Buy Weed from Women.’

That’s what is printed on the back of the coat

Meg Sanders

Meg Sanders

was wearing as she led BusinessWest on a tour of Canna Provisions’ Holyoke dispensary recently.

Those words cover a lot of ground. They’re a request, as well as a statement. They’re also an operating philosophy. And in some respects, they constitute hope for what people will be able to do more easily in the future.

Indeed, buying weed from women — as in women who own or co-own the dispensary in question — is not something easily done. The startup and operating costs for such an operation are extremely high and, for many people — and most women — simply prohibitive. And once one is in, it’s a challenge to stay in.

Sanders, CEO of Canna Provisions, is one of the rare exceptions.

She shifted her career from compliance in financial services to compliance in cannabis while living in Colorado at the time the industry was simply exploding and turning into what she called ‘the wild west.’ She is now a prominent player in the not-so-wild but very intriguing Western Mass. market, overseeing, with her partner, Erik Williams, two dispensaries (the other is in Lee) and a cultivation facility in Sheffield.

Moving forward, she envisions one more dispensary in Western Mass. — she and Williams are looking at several options for acquisition — and the buildout of another manufacturing facility in Lee. And from a bigger-picture perspective, Sanders is looking to hone a business model that will create more profitability in an industry where only a third of all busnesses are profitable.

“ I still believe the best thing in cannabis still has not been invented. We find new cannabinoids every single day; there are new ways to consume this product, new delivery methods, new formulations. Those are all really important parts of where this industry is going. Science is in it, and I am psyched to see the products we come up with to help people.”

When asked about what separates those who are profitable from those who are not, Sanders said it comes down to being smart — with everything from which products (and how much inventory) are carried to the training and development of employees.

“We invest in humans, and we train them,” she said, adding that people are the biggest and most important investment for a company in this sector.

It’s an investment she takes very seriously, and it’s one of the many reasons why she believes Canna Provisions is successful and on the cutting edge when it comes to everything from how products are displayed and sold in the dispensary to how employees are trained, groomed for advancement, and ultimately retained (more on all that later).

“I’m really proud of it — I think it’s the coolest dispensary in America,” she said of the Holyoke facility as she led the tour. “And I’ve been into a lot of them.”

Canna Provision’s dispensary in Holyoke

Meg Sanders says Canna Provision’s dispensary in Holyoke has been designed to resemble an art gallery — and even features works from local artists.

And as she surveys the scene, at that Holyoke location and within the broad cannabis industry, Sanders, who has been quoted in publications ranging from the Wall Street Journal to Northeast Leaf, sees a number of converging forces and trends, but especially innovation, the sector’s deep impact on the local economy and the local landscape, cannabis playing a growing role in the health and wellness of people of all ages, and the promise of much more of all of that in the future.

“Cannabis is a giant vote for freedom — it’s a giant vote for ‘you know what’s best for your body; it’s not the government’s job to tell you what to put in it, on it, any of that,’” she said. “From everyone that I know that uses cannabis, customers I talk to every day, their life is better. A recent study showed that 60% of Millennials use cannabis for wellness, and when you ask them to define ‘wellness,’ it was stress, relaxation, sleep, and anxiety. The fact that people look at cannabis as wellness is huge.

“And I still believe the best thing in cannabis still has not been invented,” she went on. “We find new cannabinoids every single day; there are new ways to consume this product, new delivery methods, new formulations. Those are all really important parts of where this industry is going. Science is in it, and I am psyched to see the products we come up with to help people.”

The wording on the back of Meg Sanders’ jacket

The wording on the back of Meg Sanders’ jacket is both a request and a bit of hope for what people will be able to do more easily in the future.

For this issue, BusinessWest talked at length with Sanders about her business, her industry, the words printed on the back of her jacket, and what she expects to come next with all of the above.

 

Joint Ventures

That aforementioned tour of Canna Provisions came the Wednesday before Thanksgiving. It was late morning, just before noon, and the traffic in the store was still relatively light, with a handful of customers exploring the myriad product options or talking to customer-service providers, both behind the counter and on the floor.

But Sanders was expecting a huge day because cannabis, in her estimation, is becoming a growing part of Thanksgiving, especially to contend with the week’s large doses of stress.

“People will be in to get their coping mechanisms and their celebratory pieces so they can deal with Uncle Bob, who might be talking politics at the Thanksgiving table,” she explained. “We all have families, and they’re all very interesting and come with a lot of stuff; this is one way to cope, and it’s not new.”

Meanwhile, she was expecting even bigger crowds for the upcoming Black Friday and the holiday season in general. And such expectations, born from experience in both Colorado and this market, are evidence of the growing influence of cannabis — on the economy and in people’s lives.

Turning back the clock nearly 15 years, Sanders, as noted earlier, was working for a small financial-services company handling a few dozen traders when she approached a friend who was getting in on the ground floor of the exploding cannabis scene in the Centennial State and asked if he could find a place for her.

“I had definitely hit a glass ceiling — there was nowhere else to go and no more money to be made there,” she recalled. “That was happening at the exact same time as this brand-new industry was starting to explode; I reached out to my friend who was creating this cannabis business and said, ‘I’d love to help you guys; what can I do?’

“It took a while for us to find the right place, but I went basically from compliance in the financial industry to compliance in cannabis, and that’s how I got started,” she went on, adding that she became increasingly more involved and eventually become CEO.

Sanders would eventually exit that company — primarily because its board wanted to focus solely on Colorado, while she had larger aspirations for the venture — and work, along with Williams, as a consultant to states, municipalities, and individual businesses as they entered the cannabis business.

“We were helping companies and state regulatory bodies and local governments come up with ordinances that made sense, regulatory frameworks that made sense, and helping people get licensed all over, from Florida to Illinois to Nevada — everywhere,” she recalled. “And then, Massachusetts legalization happened, and we were intrigued by the model in that it wasn’t going to be this massive gaming of the system in a limited-license structure, where if you know the governor, or have the right lobbyist, or if you make donations to the right legislators, you get a license.”

Sanders and Williams eventually consulted for a venture called Canna Provisions and were invited to become part of its operations team. They became CEO and COO, respectively, and guided the company as it gained just the second license issued by the state for a standalone dispensary in Lee, right behind Caroline’s Cannabis in Uxbridge — where she bought her jacket from owner Caroline Frankel. The Holyoke facility, located on Dwight Street in a former paper mill, opened in July 2020, at the height of the pandemic.

In her role, Sanders is involved in all aspects of the business, obviously, but devotes much of her time to staff development and that broad term ‘culture.’

‘At Canna Provisions, we really believe that we’re not just growing plants and growing a business, we’re growing humans,” she explained, adding that the company invests considerable amounts of time, money, and energy to train and develop employees, and then give them opportunities to do different things and advance within the company.

Canna Provisions invests heavily in employee training and development

Meg Sanders says Canna Provisions invests heavily in employee training and development — and the customer experience.

She said she’s currently serving as a facilitator and working with a group of seven employees at the company on a course of leadership training.

“I’m reinforcing my skills by teaching them their skills in hopes of growing humans to become better leaders, which creates happier employees,” she told BusinessWest, adding that most all of these employees have experience in business and customer service but are new to this industry.

“We work really hard to train employees, we spend a lot of money training them, and it’s ongoing,” she went on. “We’ve been told multiple times by people from this industry, and also not from this industry, that they’ve never been to a company that invests so much in training, and they appreciate it.”

 

Down to an Art

While Sanders is certainly well-known within the industry and probably recognized by many she encounters (especially when she shows her ID), she still calls what she does ‘secret shopping.’

These are regular visits to dispensaries across this region and beyond, during which she is always looking at the product mix, the presentation, the staff, and how they interact with customers — all with an eye toward making her own operations better and her own employees ever more responsive to what clients want and need.

“I shop everybody — everybody,” she said, “so that we’re more accurate in our differentiation. I’m able to see what competitors around us are doing, and I can say, ‘that’s one business model — it’s not a bad business model, it’s just not my business model.’”

“We’ve been told multiple times by people from this industry, and also not from this industry, that they’ve never been to a company that invests so much in training, and they appreciate it.”

These secret shopping excursions are just a small part of a broad operating formula aimed at continuous improvement, setting the bar higher, and then clearing that bar.

Sanders believes Canna Provisions does all this in all aspects of its business — from product selection to presentation, but especially with how those on the floor and behind the counter interact with and effectively serve customers, some of whom may suffer from what she called “dispensary phobia,” and a fear of going inside.

And this is a product of all that intensive — and expansive — training that Sanders talked about earlier.

“People have to be on point because your customers expect a certain level of service — they have to know the products,” she said. “It’s training and role playing and practicing and coaching on the floor — teaching them to be more aware of the people who are in front of them.

“This is not a cheap spend, “she went on. “Our average ticket here in Holyoke is close to 100 bucks a pop. When I’m spending $100 or $200 at a location, I do have a bit of expectation to be treated well.”

Overall, she likened the cannabis-buying experience, at least at her dispensaries, to jewelry shopping in many respects, from the high cost of the products to the way that many customers need guidance, or education, on what they’re buying.

Overall, Sanders believes she and Williams have created a different kind of cannabis experience in their locations. The one in Holyoke resembles an art gallery in the way products are displayed, and there are even works of art on the wall. Meanwhile, it pays homage to the property’s roots as a paper mill by putting some of the equipment and office furniture to work in displays.

 

Impact Statement

As she talked about the broad influence that cannabis has had on the local landscape, and will continue to have moving forward, Sanders again flashed back to the early days in Colorado, which came in 2009, the middle of what became known as the Great Recession.

“They just ran with cannabis, and it was crazy,” she said of the rapid growth of the industry and its impact on real estate, cities, towns, and individual neighborhoods. “And this started right after that massive crash and its impact on real estate and mortgages … it was a nightmare. But in Colorado, the opposite happened because all these growers, all of these dispensaries, ended up leasing more than 1 million square feet of warehouse space that had been off the tax rolls for years, just in Denver.

“So, it immediately just infused the city with vibrancy, and it happened all over,” she went on. “It was just one of those interesting economic moments where Colorado did not feel that economic downturn, the bottom dropping out, nearly as much as other states; it was fascinating. And then we kept adding all these jobs, and we kept adding jobs, and building, and then science was involved; the industry just came a long way really fast.”

It continues to grow and evolve, and now, much of what was seen in Colorado is being experienced in other states and other region, including Western Mass., she said, adding that cannabis is having a profound impact on communities like Holyoke and Lee, where she has chosen to put down roots, especially the former.

Indeed, this was a city that rolled out the red carpet for this industry, with its former mayor, Alex Morse, jokingly — although it was no joke — wishing it to become known as Rolling Paper City, a twist on its original nickname, Paper City.

Few actually call it that, but Sanders said there is no disputing the profound impact that cannabis has had in this city, where hundreds of thousands of square feet of unused or underused former mill space has been converted into dispensaries and cultivating facilities.

“Bringing more people to Holyoke is the goal for all of us,” she said. “And I think Holyoke and its bones often get overlooked; I’m so excited that there’s a new art gallery opening on High Street, that there’s several restaurants that we frequent and another new restaurant going in across the way. We have Gateway City Arts, which does concerts all the time. So, there’s momentum, and we’re hoping to be a part of that and help a city that’s been struggling for a long time.

“Together, we’re all going to make Holyoke a better place, with more jobs, more places to live, more restaurants to go to, more shopping, art,” she went on. “I absolutely love this town, and that’s why we came here and spent $1 million to open this dispensary.”

Looking ahead, Sanders wants to see a day when more women can become business owners in this sector.

“It’s very much a closed door, and the numbers are actually going down, which is unfortunate,” she said, noting, again, the sky-high costs of opening and then operating a business in this sector, and the challenge to turn a profit when 70 cents of every dollar earned is returned to the government in taxes.

“Through initiatives at the state level and maybe even at the federal level with safe banking and other things they’re talking about, we need to give minorities and women an opportunity to win alongside all the rich, white money,” she told BusinessWest. “As a female leader in this space, I am super proud to be in this space as a leader and an owner, and I would say it’s one of my biggest motivators to talk about this and do something about it.”

 

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

Another Big Step Forward

By
Opinion

Editorial

 

Just about all the dust has settled from this November’s election — finally, and thankfully. And now is the time for analysis.

And while much of the focus is on the national scene and what the results from this midterm election mean moving forward, what happened in the Bay State, where there was no suspense, is also intriguing and worthy of note.

In short, it was a milestone day for women — and the state itself.

Indeed, women won five of the six state-wide seats up for grabs. Maura Healey, the first woman elected governor of the Commonwealth (and the first openly lesbian governor in the U.S., a milestone she shares with Oregon Gov.-elect Tina Kotek), garnered much of the attention, but she was only part of the story.

Healey’s running mate, Salem Mayor Kim Driscoll, was elected lieutenant governor; Deb Goldberg was re-elected treasurer; Andrea Campbell became the first Black person elected attorney general; and Diana DiZoglio was elected auditor.

Longtime state Auditor Bill Galvin was the only man to win statewide office, and he defeated a woman, Rayla Campbell, in doing so.

So what does all this mean? First of all, more women are being elected to these offices because more women are running for these offices, which is a very positive step forward.

Before Tuesday, only nine women had served in the constitutional offices in the state’s history, and that’s largely because comparatively few women had the desire, the wherewithal, the confidence, and, in many cases, the support to seek such offices.

All that has changed in recent years, and we’re seeing it not just with statewide offices, but local offices as well. Michelle Wu became the first woman elected mayor of Boston this past year, and locally, several cities now have women in the corner office, including Easthampton and Pittsfield.

There are many reasons why more women are stepping forward and running for office, including a host of leadership programs, including several locally that encourage individuals to get involved, be active in their cities and towns, and, yes, take leadership roles.

Whatever the reason, getting more women — and more people of color and people with diverse backgrounds — involved in government, on both the local and statewide levels, can only be good for everyone involved because it means that more voices, and different kinds of voices, are being heard.

We’ve seen this in business, of course, and with very positive outcomes. Today, more women are sitting on the boards of major companies and nonprofits, more women are leading companies, and more women are taking leadership positions in realms once dominated by men, including construction, architecture, and even IT, although that is one sector where women are still looking to break through in large numbers.

Someday, perhaps not that far into the future, seeing women take five of the six — or even all six — of the Commonwealth’s constitutional offices won’t even be newsworthy. It’s only newsworthy now because it’s never happened before.

And it’s very positive news indeed, and a huge step forward for Massachusetts and all its residents.

 

Pittsfield Is Transforming Its Economy

By
Pittsfield Mayor Linda Tyer
Community Spotlight

Community Spotlight

Pittsfield Mayor Linda Tyer

Pittsfield Mayor Linda Tyer says the city has made great strides when it comes to growing and diversifying an economy once dominated by GE.

It’s called ‘Site 9.’

This is a 16-acre parcel within the William Stanley Business Park, created at the site of the massive General Electric transformer manufacturing complex in Pittsfield, which closed nearly 30 years ago.

The site has been available for development for more than two decades now, said Linda Tyer, Pittsfield’s mayor for the past seven years, but there have been no takers because, in a word, this site is ‘intimidating.’

“Every time we host a business and we identify this as a potential location, they look at it, and they’re instantly intimidated because of the condition that’s in,” she explained. “It’s a big scar in the heart of our community that’s a remnant of our past. People have looked at it, and they’ve just said, ‘I can’t envision my business here.’”

Gov. Charlie Baker was in the city a few weeks ago to hand-deliver a $3 million check that might change this equation. The money will go toward infrastructure work, putting new roads in, greening the space, and other measures that will make this parcel more shovel-ready and, ultimately, a part of this city’s future, not merely its past.

“If we don’t get any interest for the next 10 years, at least it’s not this giant wound in the heart of our city,” Tyer went on, adding she is expecting plenty of interest in the years to come.

Site 9 is where we begin our look at Pittsfield, the latest installment of BusinessWest’s Community Spotlight series. This is a city that has been trying to move beyond its past, and the dominating influence of GE on just about every facet of everyday life, since the company left. And in many ways, it has been making great progress.

Its economy is far more diverse and far less dependent on one company or one sector, said Tyer, adding that this was quite necessary given the devastation and outmigration that occurred when GE pulled up stakes. Today, the city boasts a few large employers — such as Berkshire Health Systems and General Dynamics — but the economy is dominated by small businesses across several sectors including manufacturing, IT, healthcare, and especially tourism, hospitality, and the arts.

Those latter categories now provide a good number of jobs and have contributed to a rebirth of North Street, the main thoroughfare in the city, after it was decimated by GE’s departure, said Jonathan Butler, president and CEO of 1Berkshire, a county-wide organization focused on economic development and promotion of the region.

“The Pittsfield of 2022 is a completely different city than it was 20 years ago,” he said, adding that a strong focus on the arts and hospitality has changed the narrative in this community.

The pandemic obviously took a heavy toll on these businesses and the overall vibrancy of Pittsfield, said Butler, but it has managed to come almost all the way back this year, with the arts venues rebounding and hospitality venues back to something approaching normal.

James Galli, general manager of the Hotel on North, so named because it is on North Street, agreed. He said the hotel is on pace to have its best year since opening in 2015, and the mix of guests that it attracts provides some good insight into Pittsfield and what now drives its economy.

“The Pittsfield of 2022 is a completely different city than it was 20 years ago.”

“We get a lot of travelers coming in from Boston and New York to go to Barrington Stage and the Colonial Theatre,” he said, citing two of the main cultural draws in the city. “We get a lot of millennials coming in for hiking and the beauty of the area, some business travelers coming in for General Dynamics and some of the area businesses in town — and it’s a good mix. We are the center of the Berkshires, so we get people staying with us for two, three, four days at a time; they’ll go down to South County or up to North County or into the Pioneer Valley, but they’ll stay with us because we’re very central and they can do a lot more if they stay with us.”

In some ways, the pandemic has actually benefited the Berkshires and especially its largest city, said those we spoke with, noting that the remote-work phenomenon has made it possible for those working for businesses in New York, Boston, and other expensive metropolitan areas to do so from virtually anywhere.

And with its high quality of life and (comparatively) low real-estate prices and overall cost of living, Pittsfield has become an attractive alternative, said Tyer, noting that the city is in the midst of a housing boom that has slowed only slightly even in the wake of rising interest rates and persistently high prices.

 

The Next Chapter

It’s called the ‘Library Suite.’

This is the largest suite among the 45 guest rooms at Hotel on North, and easily the most talked about. That’s because, as that name suggests, it’s decorated with books — some 5,000 of them by Galli’s count.

“There’s a moveable ladder, and … it looks like a library,” he told BusinessWest. “There’s everything from full sets of encyclopedias to children’s books, the Harry Potter collection; we’ve found them at tag sales over the years and made it into a unique, different type of room. It speaks for itself.”

Jonathan Butler

Jonathan Butler

“Pittsfield has benefited from planting its flag in the cultural and arts scene in the Berkshires; that’s a huge part of our growing economy and has been for the past 10 to 15 years.”

The library suite, which boasts about 850 square feet and goes for as much as $700 a night, depending on the season, has been occupied most every night over the past several months, said Galli, noting, again, that visitors of all kinds are coming back to Pittsfield, and to this hotel, which was created out of two historic buildings on North Street.

Business started to pick back up in June 2021 as the state essentially reopened, he said, and momentum continued to build into this year, which has yielded better numbers than the years just prior to the pandemic.

He attributes this to many factors, including some pent-up demand for travel and vacations as well as the unique nature of the hotel, which has several different kinds of rooms, each of them is unique.

“A lot of people are looking for a hotel that’s a little different — a boutique or independent hotel,” he said. “There’s a clientele that goes for the branded properties, but the people who stay with us are looking for that unique experience when they walk in the door.”

But Galli also credits Pittsfield’s resurgence in recent years, especially its cultural attractions and other quality-of-life attributes, making the city a destination for people of all ages.

Hotel on North is part of a new look and feel on North Street, said Butler, noting that the well-documented vibrancy of the GE chapter in the city’s history was followed by the dark and dismal time that he grew up in: “North Street was not a place to be in the ’90s.” The vibrancy has returned in the form of cultural attractions and new restaurants and bars.

“Pittsfield has benefited from planting its flag in the cultural and arts scene in the Berkshires; that’s a huge part of our growing economy and has been for the past 10 to 15 years,” he told BusinessWest. “You have investments like Berkshire Theatre Group with their theater in downtown Pittsfield, and Barrington Stage Company, which has become a major anchor, as well as a number of smaller cultural offerings and pop-ups and galleries in downtown Pittsfield.

“And this has been further bolstered by the emergence, over the past eight to 10 years, of a vibrant food scene — an exciting, trending type of food environment,” he went on, citing establishments, new and old, like Methuselah Bar and Lounge, Berkshire Palate (located in Hotel on North), Pancho’s Mexican Resaurant, Trattoria Rustica, Flat Burger Society, Patrick’s Pub, and Otto’s Kitchen & Comfort.

“There’s some finer dining options — downtown Pittsfield’s a great place to go host some clients if you’re a business or to have a good date night as a couple or a fancy night out with friends,” Butler explained. “But there’s also a lot of great casual offerings in downtown Pittsfield; there’s some great pubs, some great cocktail lounges. There’s also a lot of immigrant-owned businesses in downtown Pittsfield, which adds to the diversity and provides a more rich experience.”

 

At Home with the Idea

This diversification and strengthening of the city’s economy has become the main economic-development strategy for Tyer since she became mayor.

“I have some family history with General Electric — my great-grandparents were part of the GE economy,” she told BusinessWest. “And when I became mayor, I felt strongly that the economy cannot be dependent on one sector; my priority has been that we have diversity in the economy, and that includes everything from the travel, tourism, and hospitality sector to the cultural economy, and it also includes manufacturing and science and technology.”

To attract businesses across all these sectors, and to help existing companies expand, the city has created what Tyer calls its ‘red-carpet team,’ a name that hints strongly at its mission.

Pittsfield at a glance

Year Incorporated: 1761
Population: 43,927
Area: 42.5 square miles
County: Berkshire
Residential Tax Rate: $18.56
Commercial Tax Rate: $39.90
Median Household Income: $35,655
Median family Income: $46,228
Type of Government: Mayor, City Council
Largest Employers: Berkshire Health Systems; General Dynamics; Petricca Industries Inc.; SABIC Innovative Plastics; Berkshire Bank
* Latest information available

“We want to make sure that businesses that are here now, that are homegrown and might want to expand into a new market, expand their facilities, or grow their employment base, have the same level of support from the city of Pittsfield as we would give to a new business that wanted to start up in the city,” she explained. “We’ve been successful at balancing that approach.”

The red-carpet team consists of a number of city department leaders who work collectively to help counsel and guide a new or existing business toward fulfillment of whatever goal they might have. This integrated process enables a CEO to have one meeting, rather than several, said Tyer, adding that having everyone seated around one table enables the city to be more responsive and move more quickly.

And, overall, there have been a number of interested parties, she said, noting that the Berkshires, and Pittsfield, has a lot to offer employers, including quality of life and lower cost of living, as well as a population that is stabilizing, rather than declining, as it had been for decades.

“We have great neighborhoods, we’re still affordable, and we have beautiful outdoor recreation,” she said. “The combination of all of that is the magic that Pittsfield has going into the future.”

Much of this magic became even more forceful during the pandemic, said those we spoke with, noting that, while most hospitality-related businesses had to shut down for an extended period, the Pittsfield area’s outdoor recreation and quality of life came more into focus for many looking to escape what COVID brought with it.

The hiking trails became even more popular, and the Berkshires — and its largest city — became an attractive alternative for those looking to escape larger cities, their congestion, and their higher costs.

“Our housing market has been on fire,” said Tyer, noting that many professionals from Boston, New York, and other major cities have moved to the Berkshires. “And I think it speaks to this phenomenon that people can be employed by a Boston firm but work from home here in Pittsfield and have all the amenities and quality of life of a small city in a beautiful region of the state.”

The housing market shows no signs of slowing, said those we spoke with, despite rising prices and, more recently, soaring interest rates as a result of Fed action to stem the tide of inflation.

“There’s still this competition, these bidding wars, for homes,” Tyer said. “And the seller is still selling; the market hasn’t really slowed down.”

This phenomenon has led to an increase in the value of homes across the city, she went on, adding that this brings benefits on many levels — everything from the city’s bond rating to its tax rate. It also creates some problems for first-time homebuyers and those looking to trade up, and rising prices within the rental market as well, creating shortages of what would be considered affordable housing.

But in the larger scheme of things, these would be considered some of those proverbial good problems to have, said the mayor, especially in a city that had seen so much hardship over the previous 30 years.

 

The General Idea

The sports teams at Pittsfield High School are still nicknamed the Generals, said Tyer, adding that this just one of the myriad ways to measure the influence that GE had in this city for the better part of a century.

But while the city can still pay homage to its past in this and other ways, it has managed to move past it in almost all others.

Yes, Site 9 and many other parcels that were part of the massive complex remain undeveloped, but overall, Pittsfield and its economy have moved on. It took some time, as it does when a city loses an employer of such magnitude, but the city’s economy, like North Street itself, has been reinvented, and vibrancy has returned.

“We’ve overcome that group depression that we all suffered, and I think there’s a lot of excitement around the art and culture economy; the small-business, science, and technology economy; and some long-standing businesses that have grown since my time in public service,” she told BusinessWest. “I think we’ve overcome the ‘we’re a dying community because we lost GE’ sentiment, and I think we’re a growing, emerging community.”

 

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

Opioid Addiction Remains a Persistent Problem in Massachusetts

By
Cristina Rivera and Dr. Katie Krauskopf
Health Care

Crisis State

Cristina Rivera and Dr. Katie Krauskopf

Cristina Rivera and Dr. Katie Krauskopf say recovery is often a winding process marked by frustrating times and bumps in the road.

 

Christine Palmieri has read the numbers regarding a spike in overdose deaths in Massachusetts over the past couple years. But to her, they’re not just numbers.

“My role is to oversee our community-based programs that work with people who have experienced mental-health issues, substance-use disorders, and homelessness. As part of that, we run residential recovery programs for people who have a dual diagnosis, and we also run a number of different housing programs for people in recovery,” said Palmieri, vice president of Recovery and Housing at the Mental Health Assoc. (MHA) in Springfield. “And over the past year, maybe two years, we as a program have experienced more deaths by overdose than at any other time in my career.

“That’s troubling. There’s definitely times when it feels very hopeless and very frustrating, but I think our programs have done an excellent job of showing up every day, meeting people where they’re at,” she went on. “One of our programs is called GRIT, and that’s how I would describe what we need to keep coming back every day, and what the people we’re supporting in recovery need to keep coming back every day.”

After several years of decline, the rate of opioid-related overdose deaths in Massachusetts increased by 8.8% in 2021 compared to 2020, according to a June report by the Massachusetts Department of Public Health. Drug-overdose deaths in Massachusetts continue to trend lower than nationwide figures, but the statistics are still startling, with the rise in death rates reflecting the effects of the COVID-19 pandemic and an increasingly poisoned drug supply, primarily with the powerful synthetic opioid fentanyl.

“Massachusetts and the rest of the country have definitely seen a rise in overdose rates during the pandemic,” said Dr. Katie Krauskopf, medical director of Substance Use Disorder Services at MiraVista Behavioral Health Center in Holyoke. “It looks like Massachusetts’ trend is better than nationally, and there is some indication that 2022 might be better than 2021. But we clearly saw people struggling during the pandemic, and a lot of that probably had to do with difficulty accessing care and the isolation that came along with it.”

In her experience, the pandemic impacted two groups differently: many of those with substance-use disorder who were already in treatment programs did better during the pandemic because the social restrictions helped them avoid some of the triggers they might normally have encountered more frequently. Meanwhile, regulatory changes around access to treatment allowed patients to take home medications they could not previously.

“People are reluctant to hire somebody with an history of opioid addiction; people are reluctant to house somebody with a history of opioid addiction, in lots of ways that aren’t based in reality, but based in fear, based in discrimination, based in stigma.”

“So patients in treatment have done quite well,” she went on. “The real issue was the patients who were not already engaged in treatment and were unable to do so.”

The DPH found clear evidence that the COVID-19 pandemic had a profound impact on mental health and led to increased substance use and poorer mental health across the Commonwealth, especially among BIPOC communities and LGBTQ+ individuals.

“We continue to be relentless in our commitment to increase access to harm-reduction services, low-threshold housing, and treatment,” Health and Human Services Secretary Marylou Sudders said. “By working to destigmatize addiction and meeting people where they’re at, including with an expanded array of harm-reduction tools, we can reverse this negative trend.”

Locally, organizations committed to improving behavioral health — and removing the stigma and barriers that keep people from accessing care — are doing just that.

 

Support System

Palmieri said it’s important to remember that recovery doesn’t happen in a vacuum, but is tied to social determinants like housing and economic stability.

“Whether it’s opioids or anything else, our role is to help people understand what’s getting in the way of their recovery and help fill the void that used to be filled with drugs or alcohol with things they can find meaning in,” she told BusinessWest. “We’re not only interested in sobriety and helping people stop using, but also, what are you going to do instead? Our primary goal in our residential programs and our housing programs is to make sure people have a safe, affordable place to go to live after treatment, someplace that isn’t necessarily the same neighborhood where they started using in the first place, someplace they can afford and sustain — but also to find employment, something that gives their life meaning beyond using, something they can wrap recovery around.”

René Piñero, vice president of Behavioral Health & Clinical Operations at MHA, said the pandemic curtailed some services in the community to counter addiction.

“But I definitely agree that it’s not all about accessible treatment; it’s about having housing and other supports. The state has provided funding for these programs and services, but it’s also about where people go to live after treatment, what supports they have, and opportunities to find employment. Even if we have treatment that is accessible for them, if we can’t find them a home address, it’s going to be more difficult.”

For those lacking access to care, the pandemic-driven isolation people felt didn’t help, Palmieri added — and in some cases increased a sense of stigma around seeking help.

René Piñero and Christine Palmieri

René Piñero and Christine Palmieri say addiction recovery often goes beyond treatment and entails social supports like stable housing.

“People are reluctant to seek support and services because asking for help means admitting there’s a substance-use issue that’s going on, and the stigma that surrounds opioid addiction is sometimes insurmountable,” she said, adding that stigma isn’t a one-way street. “We’re trying to get people connected, but we face barriers all the time. People are reluctant to hire somebody with an history of opioid addiction; people are reluctant to house somebody with a history of opioid addiction, in lots of ways that aren’t based in reality, but based in fear, based in discrimination, based in stigma.”

Krauskopf said the Greater Holyoke area has plenty of resources in place, from increased naloxone distribution to facilities like MiraVista, which offers a full continuum of substance-use programming, from acute inpatient detox to a clinical stabilization service to outpatient programs like an intensive, four-week program that teaches skills ranging from emotional regulation to mindfulness to dealing with triggers. “It’s not one-size-fits-all here at all. We have all these programs, and patients can really fit themselves into what they need at any given time and move through the services depending on where they are.”

The state has been aggressive with programming as well, expanding substance-use-disorder treatment and overdose-prevention initiatives since the start of the pandemic and investing $120 million in prevention programs from 2016 to 2022, as well as distributing well over 150,000 naloxone kits since March 2020 to opioid-treatment programs, community health centers, hospital emergency departments, and houses of correction.

 

Try, Try Again

Cristina Rivera, director of Outpatient Services and Substance Use at MiraVista, said everyone’s addiction-recovery journey is different.

“We know that recovery is ongoing, and there might be bumps in the road. In that sense, we help people wherever they’re at. If you start using substances again, it’s not like we’re not going to accept you into our program and try to get you back on track.”

Piñero said it’s helpful to recognize that mental-health and substance-use challenges require the same attention as any chronic, physical medical issue.

“Recovery has its ups and downs just like other medical issues. Often, with diabetes, cancer, and other medical conditions that aren’t stigmatized, people are more willing to recognize that.”

Krauskopf agreed, citing studies suggesting that rates of relapse and loss of control in addiction recovery are similar to those in people managing diabetes, asthma, and high blood pressure.

“The notion that recovery is a straight line is not realistic; it’s really up and down. Part of the disease is that patients will relapse, and we’ll help them get their footing back,” she told BusinessWest. “People have begun to pivot to understand this condition as a long-term chronic condition that requires people’s full attention at different levels of intensity, and we try to provide that here.

“Recovery is about medication for some, but lifestyle modification, too,” she added. “When you think about diabetes, many people do well with changes in their diet and exercise, and many people do that and need something else at well. It’s all the same goal.”

While the need for more resources is high, she said, especially when it comes to residential programs, the hope is that those struggling with addiction will see past the persistent stigma and seek help from the many resources that are currently available, and that those overdose numbers will start to fall again.

After all, they’re much more than just numbers.

 

Joseph Bednar can be reached at [email protected]

Raising the Bar Downtown

By
Opinion

Editorial

They cut the ribbon at the new Marriott Springfield Downtown last week.

It was a lavish ceremony that was more than three years in the making. That’s how long it has taken serial entrepreneurs Vid Mitta and Dinesh Patel, owners of Springfield Hospitality, to transform the property in Tower Square, which lost the Marriott flag several years ago amid serious decline, into one of the state’s best hotels west of Boston.

A host of local, state, and national elected officials, area business leaders, and representatives of the Marriott chain turned out to celebrate the transformation of the property and the return of the Marriott flag to Springfield. There were speeches, tours, music from the Springfield Sci-Tech band, and more.

The ceremony marked more than the official ribbon-cutting for the hotel, though. It commemorated a triumph over extreme challenge — this renovation, or re-imagination, of the property was undertaken during the pandemic and thus had to overcome a series of stern challenges — and a raising of the bar, if you will, in Springfield and its downtown.

Indeed, like MGM Springfield before it, the new Marriott sets a new standard for imagination and quality in the city, and it is our hope that it will inspire others to reach higher and think bigger as they contemplate what can be done in Springfield and its downtown.

From the beginning, not just with the hotel but with the larger Tower Square property, Patel and Mitta have thought outside the box — relocating the Greater Springfield YMCA to the property is perhaps the best example — and never settled for ‘good enough’ as they have remade the landmark that opened in the late ’60s and set the tone for a period of building higher and better in the city’s downtown.

It is our hope that, more than 50 years later, the renovated Marriott and Tower Square complex can have a similar impact.

Indeed, while there has been some real progress in downtown Springfield over the past several years with MGM Springfield, the renovation of the former Court Square Hotel (still ongoing), the construction of a new parking garage (set to begin), and other initiatives, many other properties remain vacant or very much underutilized.

This is especially true farther south on Main Street in the area across from the MGM complex. But there are other properties as well that are awaiting new life.

The Marriott project, and the larger Tower Square initiative, have shown what can be done. They’ve shown what’s possible when people are willing to commit to Springfield and, as we said, think big. It is our hope, and expectation, that it will be a big success from a business perspective as well.

It is also our hope that this project, and some of the others now taking shape, like Court Square, will inspire other developers to look at Springfield as a city worth investing in.

All this, in addition to a grand new hotel, is what people were celebrating at that ribbon cutting.

 

Momentum Is Building on Victory Theatre Project

By
Donald Sanders, executive artistic director of MIFA Victory Theatre
Cover Story

The Next Stage

Donald Sanders, executive artistic director of MIFA Victory Theatre

Donald Sanders, executive artistic director of MIFA Victory Theatre

When asked how many tours he’s given of the Victory Theatre in Holyoke, the landmark that went dark in 1979, Donald Sanders gave a hearty laugh — something he does often — and just shook his head. That was his way of saying ‘more than I could count.’

Those tours have been given to elected officials, economic-development leaders, city department heads, arts groups, members of the media … you name it. They’ve all been in for a look at this piece of history that a city, and a region, have been desperate to renovate and make a part of the future, not merely the past.

And while the tours given today are essentially the same as those given years or even decades ago — they go everywhere from the front lobby to the mezzanine to the stage area — there is a new sense of urgency, optimism, and, yes, momentum — with these visits, said Sanders, executive artistic director of MIFA Victory Theatre, which has been at the forefront of efforts to restore the theater for the past 20 years.

Indeed, over the past several months, there has been a new tone to the discussions about restoring the 1,600-seat facility back to a Broadway-style theater. Specifically, there is a growing sense, after more than 40 years of talk, that this project is real.

“It’s more than just arts and culture; it’s really about impact to community and the secondary impact it offers.”

“I’ve always been optimistic that this could happen, but now, there is greater reason for optimism,” said Sanders, noting that MIFA (the Massachusetts International Festival of the Arts) acquired the Victory Theatre from the city in 2009 and has been committed to its revival since because it region’s best option for bringing large Broadway shows back to the Pioneer Valley. “There is a greater sense of momentum now than perhaps ever before.”

Several factors have contributed to this momentum — everything from a visit to the theater by gubernatorial candidate Maura Healey back in late June to a recent bus trip to Schenectady, N.Y. to take in the restoration of the Proctors arts complex, a project that is similar in many ways to the Victory initiative, to progress with the closing of a persistent funding gap thanks to federal ARPA money.

renovated Victory Theatre.

An architect’s rendering of a renovated Victory Theatre.

Some of that money has been aside for “transformative projects” in communities, said Sanders, adding that he and others have long been making the case that a restored Victory Theatre hosting Broadway shows and other large events can and will have a transformative effect on the local economy.

But there are other factors as well, said Susan Palmer, a principal with the Palmer Westport Group, which focuses on strengthening and developing fundraising and leadership capacity of theaters across the country.

She has consulted on a number of projects aimed at bringing formerly dark theaters back to useful life, and she credits the leadership in Holyoke, and especially Joshua Garcia, the city’s first Puerto Rican mayor, with injecting some needed energy and confidence in the Victory Theatre project.

“He has been fearless; he has been relentless,” said Palmer, who was a theater producer at Barrington Stage in Pittsfield and also worked at Jacob’s Pillow, the Colonial Theater, and the Berkshire Theatre Festival before launching her consulting firm in 2005. “He has a three-legged stool of priorities for the city; he wants to increase and improve the housing stock, he wants to improve educational outcomes, and he wants Holyoke to be the center of economic revitalization in that area, and he feels putting the Victory Theatre back in service is a key to that.”

Garcia, who has put together a strike force (led by his wife, Stephanie) to keep the focus on the project and raise funds within the community for the efforts, said the theater project is, indeed, a key element in efforts to revitalize the city and its downtown and bring new businesses and vibrancy to the community.

The theater has been closed since before he was born, but its importance to the city, from a cultural, economic-development, and pride standpoint, is certainly not lost on him, and he believes the remaining hurdles to restoration of the Victory can be cleared.

“This project is in the ninth inning, as I like to say, and we have a short window to close the funding gap,” Garcia said. “The gap is $15 million to $20 million, but a very clear and doable path has been identified.”

He said the trip to Schenectady, during which participants got to take in a performance of Aladdin, showed not only what can be done to restore a landmark, but what doing so means for the community.

children watch a movie at the Victory Theatre in the ’70s

At top, children watch a movie at the Victory Theatre in the ’70s. Above, a view of Suffolk Street and the theater from 1955.

“It was such an eye-opening experience to know what Schenectady has been able to accomplish with their community,” he said. “It’s more than just arts and culture; it’s really about impact to community and the secondary impact it offers; their story felt very similar to ours.”

For this issue, BusinessWest takes an in-depth look at the Victory Theatre project and at how those involved believe that now, more than 40 years after the last movie was shown there, there is sufficient funding, and momentum, to get this initiative over the goal line.

 

Marquee Moments

Palmer told BusinessWest that she has been involved with several theater-restoration projects, including the Colonial Theatre in Pittsfield, a project credited with helping to revitalize a city that had been devastated by the loss of its largest employer, General Electric.

While all of these initiatives differed in some ways, there was a common denominator: time.

Indeed, almost all of these projects took several decades to complete, she said, adding this is an element that is often overlooked in some communities undertaking such initiatives, including Holyoke.

“They all take a long time,” she said. “But the people who are working in these individual communities are only working on their project; they don’t realize that they’re in a pool of companions who have experienced the same thing.

“I worked on one in Ohio, the Woodward Opera House, that took 33 years. So there are two generations of people who have been involved with that. I was brought in in the last three years, and I would talk to people who would say, ‘my parents were working on this back when I was in grade school.’”

“I worked on one in Ohio, the Woodward Opera House, that took 33 years,” she went on. “So there are two generations of people who have been involved with that. I was brought in in the last three years, and I would talk to people who would say, ‘my parents were working on this back when I was in grade school.’”

There are at least two generations of Holyoke residents who have been hearing about, and been part of, efforts to restore the Victory Theatre.

Time has mostly stood still for the landmark since its last showing of the Clint Eastwood comedy Every Way Which Way but Loose in 1979. As one enters the theater, there are some remnants from that final showing, including a few old popcorn tubs, still to be seen.

Movie showings were the last chapter for the Victory, which was commissioned by leading industrialists in the city, including silk-factory owner William Skinner, in 1918, said Sanders, adding that it was intended to be the largest, grandest theater in a thriving city that already boasted many of them.

Turning back the clock a century or so, Sanders said Holyoke had several theaters in its downtown area, as well as a 3,000-seat opera house that stood where a parking garage now exists across from City Hall. The theaters included the Strand, the Majestic, the Suffolk, and the Bijou.

The site selected for the Victory Theatre, a name chosen to commemorate the Allies’ victory in World War I, was adjacent to the Holyoke House, then the finest hotel in the city, said Sanders, adding that this was a pattern followed by many cities at that time.

The Victory Theatre closed in 1979

The Victory Theatre closed in 1979 and hasn’t seen much light since then.

The Victory was what’s known as a ‘legitimate house,’ said Sanders, meaning that it had the finest of accommodations and was the therefore the preferred theater of choice for many performers of that era.

“That terminology means it hosted the highest level of shows and was a theater that was the best-equipped, had the best dressing rooms, etc., etc.,” he said, adding that Holyoke didn’t have a ‘legit house,’ and its leaders were determined to build one.

Fast-forwarding through the history of the Victory, Sanders said its fortunes mirrored those of the city. As the paper and textile mills that enabled Holyoke to boast one of the highest per-capita income rates in the country a century ago began to move south and then eventually offshore, the theater and the area around it started to decline, and the Victory eventually became a movie house.

As the trend in movie theaters shifted to smaller facilities in large complexes with multiple screens, its fortunes faded further until it ultimately closed. After it was taken for non-payment of taxes in the early ’80s, there were various efforts to restore the landmark, said Sanders, adding that, in all cases, the money needed — $9 million maybe 30 years ago and then progressively higher figures as the scope of the work increased — could not be raised.

In 2005, an item came before the Holyoke City Council to raze the Victory Theatre, he said, adding that he lobbied that group to stay the execution, arguing that such a vital landmark — and potential economic-development engine — should not be lost to the past.

The council listened, he said, and the Victory lived to fight another day.

To the casual observer, meaning those who haven’t been in for a tour, the facility seems frozen in time and unchanged. But that’s not the case, said Sanders, noting that a number if improvements have been undertaken over the years to ready the theater for restoration.

Steps have included asbestos removal, installing a new roof, converting the gas utility to electric (a project still underway), restoration of historic murals located near the stage, replacing non-compliant window coverings with new polycarbonate clear coverings, and other initiatives that together total nearly $5 million.

Overall, the structure is very sound, noted Sanders, adding that no expense was spared in building it.

 

Victory Is in Sight

To bring a project like the Victory Theatre to a successful result, a number of elements have to come together, Palmer said. These include leadership, a commitment from the community, funding, of course, and sometimes a little luck.

In the case of the Victory, the luck, if one chooses to call it that, comes in the form of ARPA money in the wake of the pandemic, funds that are expected to close most, but not all, of a $5 million to $6 million gap between the $58 million needed for the project and what has been raised through various means, including historic tax credits and new market tax credits; private, individual, corporate, and foundation donations; and public grants.

“ARPA money is what helped this project turn the corner,” Palmer explained, adding that the federal government has released $350 billion in funds to individual cities and states, and those working on the Victory Theatre project are currently working with several lobbyists to position this initiative for a $12 million ARPA allocation.

“It hasn’t happened yet … it’s coming in dribs and drabs, pieces here, pieces there,” she said, adding that the ARPA funds will constitute roughly half of what still needs to be raised for the project.

The rest will be raised locally, she said, adding that $7.5 million has been pledged, and there are plans for a community effort with a goal of raising $2 million.

Local fundraising will include mostly smaller donations, Palmer said, but that grassroots effort, which will involve phone calls, knocking on doors, letter-writing campaigns, and fundraisers and friendraisers of all kinds, will bring area residents and businesses into the fight to restore the theater, and it will send a strong message to elected leaders about the importance of the initiative — to the city and region as a whole.

Mayor Garcia agreed, and noted again the importance of the project, not just from the standpoint of the arts, as significant as that is, but to the proverbial big picture in Holyoke and the region.

“The Victory Theatre checks off a lot of boxes,” he said. “When we think of what we’re trying to do in our city, in our downtown, in terms of tourism and economic development, this is just another piece of the greater economic system puzzle that we’re trying to solve here.”

Elaborating, he said the theater cannot exist in a vacuum, and there must be an infrastructure of supporting businesses — restaurants, bars, and other hospitality-related ventures — to make a revitalized Victory Theatre succeed.

Palmer concurred, and to explain, she did some math.

“When the theater opens, it’s going to be substantial — there are 1,600 seats in there,” she said. “The average occupancy, or utilization, rate of any nonprofit regional theater on any given night is 65%, so there will be 1,100 people bopping around that neighborhood several times a week. Right now, there aren’t many things to do, and certainly not enough to accommodate 1,100 people.

“So, there’s a parallel effort we’re working on to make sure, when the theater opens its doors, that the ancillary economic benefit will be ready to go,” she went on, adding that city officials and the strike force are working to help make sure that there is an infrastructure in place to support the theater.

Meanwhile, work continues to build on the current momentum and convince the public that there is a path to getting this done, said Aaron Vega, Holyoke’s Planning director, adding that more than 40 years of waiting for action on the property has created some stubborn skepticism that still must be overcome.

“It does take a long time for these projects to happen, and there has been work done,” he said. “Unfortunately, it’s not visible from the outside; people drive by and say, ‘it looks the same as it did 10 years ago or 20 years ago.’ Overall, we need to reinstill some energy and some trust that this project is real.”

The bus trip to Schenectady and the Proctors arts complex was part of this larger effort, said Vega, noting that Schenectady and Holyoke are very similar in that they were both devastated by the loss of large employers (in the former’s case, it was General Electric). And their respective restoration projects are similar as well in that they involved long periods of time and a deep commitment from the community.

“One of the reasons we took that trip is to have people be able to come back and tell the story of what a theater like this could do for Holyoke, obviously, but also the entire region,” he said, adding that these discussions are now being had, generating what he and others expect will be more momentum.

And momentum not just for theater, he said, but what can come because of such a facility.

“I’m hoping that people can see the spinoff,” he explained. “The new restaurants, the buildings that were unoccupied being reoccupied — that’s the thing we want to see, the spinoff and the ripple effect; that’s what is going to affect everyone, not just those who will go to the theater.”

 

Bottom Line

Returning to the subject of those tours he has given — and will continue to give — Sanders said they do more then enlighten. They also educate and inspire those who take them.

In most all ways, they are better than a marketing brochure, better than talking to someone about the history and importance of this landmark.

“It’s our biggest selling point; it’s much better than me saying, ‘we have the last Broadway house in the region,’” he noted. “People walk through the door, they see 800 seats and the stage … and they realize what a treasure this is.”

It’s been 43 years since this treasure was anything more than a piece of history, but if all goes well — and things are tending in that direction — it will soon be an important piece of the future.

 

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

Ballot Effort to Levy 4% Tax on High Earners Finds Support in Poll

By
Accounting and Tax Planning

Million-dollar Question

Anew poll of Massachusetts voters conducted by Suffolk University, the Boston Globe, NBC10 Boston, and Telemundo found that 58% of respondents support ballot Question 1, compared to 37% in opposition. Question 1, on the Massachusetts ballot on Nov. 8, would create a 4% tax on the portion of a person’s annual income above $1 million and require that the funds be spent only on transportation and public education.

“Tens of thousands of educators, workers, small-business owners, parents, faith leaders, municipal officials, drivers and transit riders, and more than 500 organizations across the state are all working together to pass Question 1 in November,” said Lillian Lanier, field director for Fair Share for Massachusetts, the leading advocacy group working to pass the ballot initiative. “We’re supporting Question 1 because we know it will help improve our schools and transportation infrastructure, and only the very rich will pay more. A few billionaires are trying to mislead voters about what Question 1 does, but our grassroots supporters are having thousands of conversations every day to combat their misinformation.”

That survey result may be concerning to the Coalition to Stop the Tax Hike Amendment, the leading collection of organizations opposed to the initiative, claiming to represent more than 25,000 small businesses, in addition to thousands of homeowners, retirees, farmers, and large employers.

“If passed, Question 1 would be one of the highest tax hikes in Massachusetts history, immediately and permanently implementing an 80% tax increase and threatening small businesses across the state,” the coalition argues. “Question 1 captures tens of thousands of small-business owners who do not make more than $1 million per year and are working hard to rebuild after the negative impacts of the pandemic. At a time when we should be helping our small businesses recover, small-business owners will instead be left reeling from a new, unprecedented financial hit.”

As written, the proposed amendment to Article 44 of the Massachusetts Constitution states that, “to provide the resources for quality public education and affordable public colleges and universities, and for the repair and maintenance of roads, bridges, and public transportation, all revenues received in accordance with this paragraph shall be expended, subject to appropriation, only for these purposes.

“In addition to the taxes on income otherwise authorized under this article, there shall be an additional tax of 4% on that portion of annual taxable income in excess of $1 million reported on any return related to those taxes.

“To ensure that this additional tax continues to apply only to the Commonwealth’s highest-income taxpayers, this $1 million income level shall be adjusted annually to reflect any increases in the cost of living by the same method used for federal income tax brackets. This paragraph shall apply to all tax years beginning on or after January 1, 2023.”

The Coalition to Stop the Tax Hike Amendment argues that Question 1 impacts the tens of thousands of small businesses across the state that file taxes as pass-through entities, noting that these small businesses file their business’ revenue as personal income, even though much of it is reinvested back into their business. The coalition notes that many of these small businesses are operating on razor-thin margins and take home very little profit, yet the proposed amendment treats their business revenue as if they are a high-earning individual, threatening their business’ viability.

“Our organization represents 4,000 small businesses across the state, with a vast majority of these businesses set up as pass-through entities,” said Jon Hurst, president of the Retailers Assoc. of Massachusetts. “Many of these organizations could see their taxes nearly double under Question 1. This constitutional amendment will devastate our local economy and threaten small businesses statewide.”

The coalition also argues that Question 1 robs the nest eggs of small-business owners who are relying on the sale of their business to fund their retirement. Unlike federal taxes on personal income, this measure treats one-time gains — such as those from selling a business, home, or farm — as regular income, pushing many retirees into the new, higher tax bracket, and nearly doubling their taxes.

Among the organizations that have united against the amendment are the Massachusetts High Tech Council, Associated Industries of Massachusetts, the Western Massachusetts Economic Development Council, the National Federation of Independent Business, the Massachusetts Fiscal Alliance, the Massachusetts Farm Bureau, the Massachusetts Retail Lumber Dealers Assoc., the Springfield Regional Chamber and many other chambers of commerce, the Alliance of Automotive Service Providers of Massachusetts, the Massachusetts Seafood Collaborative, and the Massachusetts Business Roundtable.

But Question 1 does have supporters, as the Yes on Question 1 campaign has been endorsed by 87 labor unions; 72 community organizing groups; 18 faith-based groups; more than 75 businesses; 64 city councils, select boards, and school committees; 89 local Democratic town and ward committees; and 115 other social-service and not-for-profit organizations focused on housing, education, transportation, public health, and the environment.

Supporters call the amendment an opportunity for Massachusetts to improve schools and colleges, fix roads and bridges, create jobs, and boost the economy, all without 99% of taxpayers paying a single cent more.

As a tax on personal income over $1 million, Fair Share for Massachusetts argues, business taxes would not be affected, and Question 1 doesn’t apply to any business revenues. It notes that fewer than 3% of businesses owners in Massachusetts have taxable personal income over $1 million that would be subject to Question 1, and many of them are primarily investors or shareholders, not people running a business day-to-day.

“If a business is generating more than a million dollars in personal profit for the owner, even after they deduct all their business expenses, let’s be real: it’s not a small business, and that super-rich business owner can afford to pay their fair share in taxes,” said Gerly Adrien, business director of Fair Share for Massachusetts and owner of Tipping Cow Ice Cream in Somerville and Boston.

International Language Institute Adapts to New Realities

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Caroline Gear says the pandemic brought challenges
Education

What’s the Word?

Caroline Gear says the pandemic brought challenges

Caroline Gear says the pandemic brought challenges to ILI, but also new ways of connecting with language learners.

 

A global pandemic hit businesses and nonprofits in different ways. For the International Language Institute of Massachusetts (ILI), which relies on a steady flow of international students, the impact was especially great, as global travel slowed and those connections quickly dried up.

“We went from close to $350,000 a year in our Intensive English programs to $86,000,” said Caroline Gear, the institute’s executive director since 2015. She noted that the CARES Act and other emergency COVID relief, PPP loans, and an employee-retention tax credit helped ILI over the roughest whitewater, and international students are coming back … to an extent.

“I don’t think it’s ever going to come back to pre-pandemic times, but I like to say that we’re emerging anew,” Gear said. “I wouldn’t call it a recovery, because I don’t think we’ll ever recover to those numbers.”

The headwinds include a strong U.S. dollar making it expensive to travel to the States for study, as well as more competition from other countries with programs that teach English and other languages. “Canada opened up much quicker than us after the pandemic, so a lot of students went to the Canadian market and not to the United States. With Brexit, the U.K. lost a lot of international students, too.”

Still, Gear said, “I believe the United States academic culture and expertise and prestige is number one, but we have to make sure that we stay that way and continue to be welcoming. When you’re looking at where our students are coming from, I love the fact that we’re so diverse.”

The numbers bear that out. ILI’s Free English program alone — just one of several major programs at the institute (more on them later) — boasts 120 students from 27 different countries, ranging in age from 17 to 80. In one change from before COVID, five of the six sections are online, though the Intensive English program, because of its immersive aspect, is delivered in-house.

“We’ve all put in extra time because we all believe in this mission of promoting intercultural understanding and diverse communities through high-quality language and teacher training.”

“When the pandemic hit, we thought we would be back in a few months, but we wound up moving all of our classes online,” Gear said, adding that the Intensive English students were the first to return to face-to-face instruction, in August 2021. “Other than that, most of the classes were still meeting online. Our teachers are amazing; they went from emergency teaching to really creating an amazing curriculum online. Online teaching is another revenue stream, which is important for a nonprofit, but I really didn’t want to do it that way.”

But while much of the live instruction has returned to New South Street in Northampton, remote learning will remain part of the plan going forward, which allows ILI to reach students anywhere.

With nine full-time and 23 part-time instructors and staff at the moment, Gear said, “we’ve all put in extra time because we all believe in this mission of promoting intercultural understanding and diverse communities through high-quality language and teacher training.”

 

An Idea Takes Root

In 1984, Alexis Johnson was a language teacher without a job. But she didn’t lack for vision or passion. So she and another teacher, Janice Rogers, decided to open a language school, one that would meet the needs of myriad clientele, from local non-English speakers aiming to improve their workplace communication to student visa holders preparing for college stateside, to Americans skilled in other languages seeking training to become teachers overseas.

After decades of growth that affirmed her initial vision, Johnson stepped down from the executive director’s chair in 2015 after 31 years, handing the reins to Gear, who has been at the institute since the mid-’80s.

From left, Macey Faiella, director of English Programs; Heather Hall, office manager; Caroline Gear, executive director; and Samira Artur, instructor and program coordinator.

Perhaps the most well-known of ILI’s programs is its World Language program, which teaches a number of languages to students with a variety of goals. Some have a son or daughter marrying someone from another country. Others want to boost their communication skills on the job in an increasingly multi-cultural world. Still others want to advance on the job.

Another popular option is the Free English program, a partially grant-funded initiative that provides free classes for immigrants and refugees looking to improve their English skills for work, college, and their daily lives. English classes meet two evenings a week for a total of six hours.

On the flip side is the Intensive English program, which offers an immersive education for international students, with 21 hours of instruction weekly.

“Maybe their company sends them here, or maybe they know their ability to get a job is improved with a better English level,” Gear said. “The average intensive stay is three months; some take longer. Then they go to university or go home and get a job. Area employers will also send employees here to improve their English.”

Four scholarships — funded by Dean’s Beans; immigration law firm Curran, Berger & Kludt; an anonymous donor, and in honor of a board member’s late uncle, Richard Martin — are offered annually to move four students from the Free English program to Intensive English.

“It’s phenomenal to see what they have to say of the difference between six hours and 21 hours,” Gear said. “It takes about a year of classes in the Free English program to go from one level to another, and now they can do that in three months, so it’s really accelerated learning.”

Meanwhile, students in the University Pathways track of the Intensive English program receive individualized support to transition successfully to a university or college. Instead of cramming for exams or memorizing grammar rules, they practice a set of skills including essay writing, classroom participation, interactive presentations, small-group discussions, team collaboration, academic research, and critical analysis. By focusing less on test taking and more on academic training, they’re better positioned to succeed. 

ILI boasts partnerships with more than a dozen colleges and universities, Gear said, that offer these students conditional admission if they meet certain criteria. “They don’t have to take a standardized English test because those schools trust us and know we won’t recommend them unless they are ready to go. We’ve been in this business many years, and we know when people are ready to be successful.”

She added that, “no matter how great your English level is, academic culture in the United States is completely different from their home culture academically. We get them away from rote learning and rote test taking by working on cultural skills, active participation, written and oral production, independent self-direction, peer collaboration, and critical thinking. It’s really helpful for students because they’re so used to one way of teaching for so many years, and we don’t do it that way here.”

ILI’s Workplace Training program offers language courses for companies and employees that bring specialized language training to the workplace. Small businesses can apply to a state fund that pays for this training, Gear said, which makes sense at a time when worker recruitment and retention are such a challenge.

“We all know the situation with finding employees. So if a company finds a great employee but finds their language skills need improvement, working with the state of Massachusetts to have them pay for it is phenomenal.”

As one example, as Gear was giving a tour of ILI to BusinessWest, Office Manager Heather Hall had just gotten off the phone with Flour Bakery in Boston, which employs more than 400 people and was looking for English and Spanish training for many of its staff.

“I’m always learning from our students, and we are making a difference in so many people’s lives. It’s incredibly gratifying to be able to do this work.”

“We’ve also worked with the Holyoke public school system, where we teach the teachers Spanish and the parents English,” Gear said. “It’s not only about learning a language, it’s about learning a culture, navigating systems, and playing an integral role in making sure people feel safe to take risks and get to the next step of their career.”

The sixth — but certainly not least — major component of ILI’s programs is Teacher Training, specifically the SIT TESOL Certificate program, which becomes the graduate’s ticket to teaching language, both in the U.S. and internationally.

 

Diving In

At the heart of all these programs is a teaching style that, as noted earlier, ditches rote memorization for an immersion approach where constantly putting language into practice, student to student, trumps getting every word perfect.

There’s an element of fun to this immersion, too, Gear said. As one student told her, “we play a lot, but I’m learning a lot.”

Gear and her team are learning, too — about how to navigate a post-COVID world that offers new challenges, but new opportunities as well.

“We’ve diversified more, but we still do the same thing: we teach languages, and we train teachers,” she told BusinessWest, noting that a permanent online presence will be a positive from a revenue and growth perspective.

“It was pandemic-driven because our school runs tuition-based programs that support our partially funded Free English classes. So we need students as well as grants and incredibly generous donors to support our school,” she explained. “We wanted to do online instruction, and now we will always teach online, even as people start to come back to more face-to-face programming.”

After all, she said, “not everyone wants to have classes face to face. There are transportation issues, there are childcare issues, so it’s all about access to education. If we can continue to provide classes to folks virtually and also bring them back in here, that’s a positive.”

At the same time, those in the Teacher Training program are learning to teach online, too, a necessary skill post-COVID.

Coming up on ILI’s annual giving season, when letters of appeal are sent to potential supporters, Gear noted that “it’s not just one thing that runs this school; it’s a variety of revenue streams — tuition-based programs, generous community supporters, grant foundations that support us … and love.”

She’s also hoping for some of the ARPA money being distributed by the city of Northampton, which would be put to use upgrading the institute’s space and air flow as part of a three-phase improvement plan.

But mostly, she’s adapting — and appreciating the impact the International Language Institute has on individuals, families, businesses, and communities both locally and around the world.

“I love my job. I love who I get to work with, what we do to help people to the next step,” she said. “I’m always learning from our students, and we are making a difference in so many people’s lives. It’s incredibly gratifying to be able to do this work. It’s not been easy through the pandemic, but we’ve learned to embrace the uncertainty and look for opportunities.”

 

Joseph Bednar can be reached at [email protected]

How the Use of Non-competes Is Becoming Ever-more Restricted

By Contributor
Employment

Let the Buyer Beware

By Alexander Marsh and Jeremy Saint Laurent, Esq.

 

Historically, non-competition agreements have been a useful tool for employers to protect their businesses, financials, and proprietary information when a departing employee leaves the company to work for a competitor. Over the past decade, the ways in which non-competition agreements can be used has been restricted.

Indeed, Massachusetts has significantly limited the functionality of non-competes, and California has barred them altogether. Recently, the federal government, vis-a-vis the Federal Trade Commission, has limited their use in corporate mergers and acquisitions.

“In October 2018, Massachusetts practically banned non-competes through the creation of very specific and strict requirements. As a threshold matter, non-competes in Massachusetts cannot be freely used and, rather, must protect a legitimate business interest.”

Alexander Marsh

Alexander Marsh

Jeremy Saint Laurent

Jeremy Saint Laurent

Just four years ago, in October 2018, Massachusetts practically banned non-competes through the creation of very specific and strict requirements. As a threshold matter, non-competes in Massachusetts cannot be freely used and, rather, must protect a legitimate business interest. The definition of legitimate business interest is limited to trade secrets, confidential information of the employer that otherwise does not qualify as a trade secret, or the employer’s good will.

Other alternative restrictive covenant, such as non-solicitation, non-disclosure, and/or confidentiality agreements, must be explored prior to resorting to a non-compete.

Massachusetts further tightened up the ability to implement non-competes by creating a litany of other requirements. The non-compete must:

• Be in writing;

• Be signed by both the employer and the employee and state that the employee has a right to consult a lawyer before signing the agreement;

• Provide notice of the agreement to the employee (the notice requirements change depending on when the employee is asked to sign the agreement); and

• Occur at the beginning of employment or provide notice of the agreement no less than 10 business days before the agreement would become effective and provide additional compensation.

The conduct the agreement seeks to prevent must not violate the public interest. Generally, public policy favors an employee’s ability to move from one job to another without restriction. Only a narrowly tailored agreement to protect a legitimate business interest will fit within public policy.

It is against public policy in Massachusetts to allow for non-compete agreements in certain professions. Non-competes signed by nurses, physicians, psychologists, social workers, and certain employees of broadcasting companies are considered void in Massachusetts. This is to protect public health and the free flow of information and ideas. A non-compete agreement in any of these areas is unenforceable as a matter of law.

Additionally, a non-compete agreement is not valid against a low-wage employee. The law states that employees who are classified as ‘non-exempt’ (typically, employees eligible for overtime pay and hourly wages) under the federal Fair Labor Standards Act may not be required to sign a non-compete agreement.

Non-competes are also prohibited or unenforceable when an employee is terminated without cause or laid off. These workers are not bound by the terms of any non-compete agreement that they have already signed with their employer.

Now, on the federal side, non-competition agreements are coming under scrutiny through corporate mergers and acquisitions. The primary rationale for restricting them is public-policy concerns.

Traditionally, non-compete agreements as part of a corporate merger or acquisition were quite broad in scope and geography. The reason for their broad coverage makes sense: the sale of a business is primarily based upon good will. Buyers understandably would require broad non-competition coverage so, post-sale, they are not competing against a seller who may start or work for a competitor company. In other words, in a business sale, to protect its interest in the business, the buyer would want to restrict the seller’s ability to compete against it.

However, the Federal Trade Commission recently restricted the ability of a buyer to require broad, sweeping language in non-competes. Rather, they must be limited to what is specifically needed to protect portions of the business.

What does all of this mean for companies? Knowing how to properly craft a valid, legally enforceable non-competition agreement is paramount. As with other restrictive covenants, non-competition agreements should be used sparingly and tailored as narrowly as possible to adequately protect your client’s legitimate business interests without being overly restrictive to the employee.

Generally, a one-year duration is considered to be reasonable. Depending on the circumstances, it may be possible to protect your client with a non-compete that has a shorter enforcement period. Again, as a rule of thumb, the shorter the length of restriction, the more likely the non-compete will be enforceable. It may also make sense to explicitly prohibit competition during employment.

 

Jeremy Saint Laurent, Esq. is a litigation attorney who specializes in labor and employment law matters at the Royal Law Firm LLP, a woman-owned, women-managed corporate law firm that is certified as a women’s business enterprise with the Massachusetts Supplier Diversity Office, the National Assoc. of Minority and Women Owned Law Firms, and the Women’s Business Enterprise National Council; (413) 586-2288. Alexander Marsh is a legal assistant at the Royal Law Firm LLP.

SJC Ruling Clarifies Standards for Expunging of Criminal Records

By Contributor
Law

Case in Point

By Justice Mary-Lou Rup and Briana Dawkins, Esq.

A recent decision from the Massachusetts Supreme Judicial Court (SJC), Commonwealth v. K.W., clarifies the standard for persons seeking to expunge records of criminal court appearances and dispositions from their state criminal records (known as Criminal Offender Record Information, or CORI) and court and criminal justice agency records.

By way of background, it is important to first understand that in Massachusetts, individuals may seek to clear their CORI in one of two ways: through sealing or expungement. If sealed, the record still exists but is unavailable to the general public. If expunged, the record no longer exists.

Petition to Seal Record (Mass. General Laws, Ch. 276, Secs. 100A-100D)

With some exceptions, one can petition the commissioner of Probation to seal disposed cases after a period (three years for misdemeanors and seven years for felonies) beginning on the later of the date of a guilty finding or release from incarceration, with no intervening criminal convictions. A judge can allow immediate sealing if the charge ends with a finding of not guilty or no probable cause, dismissal, or nolle prosequi, and must allow a petition to seal for first-offense convictions (with successful completion of probation), not-guilty findings, dismissals, or nolle prosequi of possession of marijuana or Class E controlled substances or in the presence of a person in possession of heroin, as well as decriminalized offenses.

For other offenses, sealing is discretionary, and the petitioner must show ‘good cause’ — that continued public availability of the record creates a current or foreseeable future disadvantage. If sealed, the courts will report ‘no record’ to criminal background checks, and the individual, if asked (such as on an employment application), can report having no record as to the sealed offense. However, courts, police, criminal-justice agencies, and certain other entities still have immediate access to sealed records.

Petition to Expunge Record (Mass. General Laws, Ch. 276, Secs. 100F-100P)

In 2018, as part of the Criminal Justice Reform Act, the state Legislature created two pathways for individuals to seek expungement. Following the first pathway (referred to as ‘time-based’ expungement), individuals who, before age 21, committed certain low-level offenses may apply to expunge those records.

Following the second pathway (known as ‘reason-based’ expungement), an individual can seek expungement of juvenile and adult criminal court appearances and dispositions by presenting ‘clear and convincing evidence’ that the record was created as a result of false identification or unauthorized use or theft of identity of the petitioner; fraud perpetrated on the court; ‘demonstrable’ error by law enforcement, witnesses, and/or court employees; or an offense that is no longer a crime.

There is a ‘strong presumption’ in favor of expungement of records created as a result of one of the statutory factors. That said, expungement is not automatic. A judge has discretion and must still balance that presumption against any ‘significant countervailing concern’ that may be raised when deciding if expungement is ‘in the best interests of justice.’ If none are raised, the judge must order expungement.

An expungement order results in permanent erasure and destruction of the record of the qualifying offense. Expungement of the record for a qualifying offense will have no effect on the existence of other records related to the same or other incidences.

Sealed or Expunged Records

It is important to understand the policy reasons that support the sealing and expunging of records. As the SJC noted in its recent decision, whether to seal a record ultimately relies on a defendant’s and the Commonwealth’s interests in keeping the information private, which includes “reducing recidivism, facilitating reintegration, and ensuring self-sufficiency by promoting employment and housing opportunities for former criminal defendants.”

With regard to expungement, the SJC stated that by specifically creating the qualifying reason-based factors, the Legislature itself had identified a good cause basis for expungement. Records created as a result of one of those factors “have virtually no bearing on whether the petitioner might commit a criminal act in the future, and their value to society therefore is vanishingly small.”

Once sealed or expunged, a record cannot disqualify a person from examination, appointment, or application for employment with any government agency, or in determining if that person is suitable for the practice of any trade or profession requiring a license.

Any application for employment that seeks information concerning prior arrests or convictions must contain the statements required by the statutes relating to sealing records and expungement of records regarding the applicant’s ability to answer ‘no record’ when records have been sealed or expunged. Employment applications should be reviewed to ensure compliance with the required language.

This article gives a general description of sealed and expunged criminal records. However, procedures for and the effects of sealing and expungement are complicated. Therefore, interested individuals should carefully review Massachusetts General Laws, Chapter 276, sections 100A-U, or seek advice from an attorney.

Justice Mary-Lou Rup is a retired Massachusetts Superior Court judge and now senior counsel at Bulkley Richardson. Briana Dawkins is also an attorney at Bulkley Richardson, where she practices in the employment and litigation groups.

Sports Betting Is Legalized in Massachusetts, but the Benefits Are Uncertain

By
Cover Story

At the Goal Line

With 35 other states having done so already, Massachusetts lawmakers were eager to pass a bill this summer legalizing sports betting, and Gov. Charlie Baker followed suit, signing it into law. Now comes the hard work by the Gaming Commission to establish a framework and scores of regulations — and the continuing research into a recreational activity that brings a still-uncertain level of economic benefit, alongside some well-established social risks.

The MGM Sports Lounge

The MGM Sports Lounge was designed to enhance the sports viewing — and eventually gambling — experience.

Rachel Volberg has been researching the effects of gambling for almost four decades, and since 2013, she’s been doing it at the behest of the Massachusetts Gaming Commission (MGC), which selected her team a decade ago to research the potential impacts of casinos.

“We’ve kept a pretty careful eye on things, but only a few U.S. states have any funding in their legislation to conduct research, so we know surprisingly little about the social and economic impacts of betting in the United States as a whole,” she told BusinessWest, and that’s even more true when it comes to legalized sports betting, which Massachusetts recently became the 36th state to legalize.

A research professor in the UMass Amherst School of Public Health and Health Sciences, for the past decade Volberg has been the principal investigator with Social and Economic Impacts of Gambling in Massachusetts (SEIGMA), whose latest report — the first of its kind in the nation — deals with the potential impact of legal sports gambling in the Bay State. And if the picture is still uncertain, it’s coming into focus.

“I think the biggest surprise for us was how little research had actually been done, particularly on the economic impacts — what does the industry look like once you legalize it, once it’s operational? What kinds of jobs, what kinds of revenues, and how are those jobs translating into economic benefits? There were literally only two or three economic studies we were able to identify, so there’s clearly a lot of work to be done in that area.”

What is emerging may not thrill proponents of sports gambling who support legalization on economic grounds. The study contends that direct economic impacts will depend on shifting spending from the illegal to legal market, and the impacts will not be entirely new since the majority of these already occur due to the illegal market. In addition, sports betting will primarily redistribute money already in the economy rather than attracting new money from outside Massachusetts.

“Sports betting is, by far, the number-one question I get asked on a daily basis, and it has been for years now. The entire team is looking forward to welcoming the first bet. When the time comes, we’ll be ready.”

“When you compare the tax revenue we anticipate being generated in Massachusetts by sports betting, the optimistic scenario is $60 million a year,” Volberg said, “which is not very large compared to the lottery, which in 2019 generated $1.1 billion in tax revenue, or casinos, which in 2019 generated about $168 million.”

That’s not nothing, of course, and state lawmakers overwhelmingly supported the bill to bring sports gambling out into the open, as did Gov. Charlie Baker, who signed the bill into law shortly after. It was the culmination of momentum that had been building since sports betting was legalized by a U.S. Supreme Court decision in 2018. Area legislators pointed out that, with every state in the Northeast having followed suit, Massachusetts was losing money to its neighbors.

“Legalizing sports wagering in Massachusetts will allow us to finally compete with neighboring states and will bring in new revenue and immense economic benefits,” state Sen. John Velis said in August.

The bill allows for 15 online licenses for companies like DraftKings and FanDuel, in addition to five retail licenses for the three casinos and two racetracks in Massachusetts. The bill also creates a commission to study additional licenses for smaller businesses, such as bars and restaurants.

The bill includes out-of-state collegiate betting but does not allow bets on Massachusetts college teams unless they are in the playoffs. The bill also includes a 20% tax on mobile bets and a 15% tax on retail bets, which would be paid by the operating company.

Rachel Volberg

Rachel Volberg

“At this point, the most optimistic scenario for sports betting tax revenues in Massachusetts is about $60 million, and that’s assuming the legal operators are able to capture the great majority of the legal market. It also assumes it will attract people who haven’t bet on sports before there was a legitimate, legal provider.”

“Sports betting is, by far, the number-one question I get asked on a daily basis, and it has been for years now,” said Chris Kelley, president and chief operating officer of MGM Springfield, which built two sports viewing lounges last year partly in anticipation of legal sports betting (more on those later). “The entire team is looking forward to welcoming the first bet. When the time comes, we’ll be ready.”

 

Devil’s in the Details

With the legislation now law, the MGC will work out the details that will make legal sports betting a reality. It has already come up with a list of about 225 regulations that will need to be drafted.

“A great deal of work has already been done by our team in anticipation of sports wagering becoming legal in Massachusetts,” Gaming Commission Executive Director Karen Wells said last month. “This includes identifying over 200 potential regulations, adopting a framework to utilize industry-recognized technical standards, establishing an infrastructure to investigate and license applicants, initiating the hiring of a chief of Sports Wagering, and scheduling public meetings. Now that we have a law that defines our responsibilities as regulator, we will work with our stakeholders to swiftly stand up this new industry with a focus on integrity, player safety, and consumer protection.”

They’ll take a hard look at SEIGMA’s report in crafting that framework and its many elements, Gaming Commission Chair Cathy Judd-Stein said, noting that “this report will aid the MGC as we begin to regulate a sports-wagering industry in the Commonwealth with an uncompromising focus on integrity and player safety.”

Volberg added that “we were trying to give a very broad overview of what is known at this point about the social and economic impact of sports betting, and it’s the first nationwide effort to do that. It also summarizes what we know about sports betting in Massachusetts.”

She told BusinessWest that the ‘handle’ — a term that refers to all money bet, including rewagered winnings, creating a high level of churn — is not the same as the total revenue taken in by operators.

“It’s easy to lose sight of the fact that sports betting is run on very narrow margins, so the actual revenues the operator is able to generate are a very small number of what the handle numbers are,” she explained. “At this point, the most optimistic scenario for sports betting tax revenues in Massachusetts is about $60 million, and that’s assuming the legal operators are able to capture the great majority of the legal market. It also assumes it will attract people who haven’t bet on sports before there was a legitimate, legal provider.”

Because so little information about the impacts of sports betting is available, Volberg’s team mined data from their own surveys and studies that are part of the research ordered by the Massachusetts Legislature when lawmakers passed the Expanded Gaming Act in 2011. Meanwhile, a representative survey of 8,000 adults was completed in Massachusetts earlier this year and provides a snapshot of changes in gambling behavior, attitude, and problem-gambling prevalence since 2013-14.

“The National Council on Problem Gambling has seen a significant increase in sports-betting participation since 2018,” she told BusinessWest, noting that it has also reported an increase in people saying they had experiences with one or more impacts or harms.

“That suggests that an increase in sports betting has the potential to come with increased harm, which is not a surprise, but in Massachusetts, because the Gaming Commission already has familiarity with implementing measures to try to minimize and mitigate harm — because they already have that experience with casinos — we’re hopeful those harms can in fact be minimized,” Volberg added.

Cathy Judd-Stein

Cathy Judd-Stein

“This report will aid the MGC as we begin to regulate a sports-wagering industry in the Commonwealth with an uncompromising focus on integrity and player safety.”

Alisha Khoury-Boucher, a clinical supervisor at MiraVista Behavioral Health Center, agreed to an extent. “Gambling has been a concern for a long time, but we already have a casino close by, so we don’t see a major change with the people we serve from legalizing sports gambling; if they wanted to do those things, they were already doing those things. It’s the behavior more than the access.”

Still, she added, “in my opinion, where we may see more of a problem is with young people, college-age people, who may still be home with mom and dad and have more disposable income. We might see an increase there, but that’s to be determined.”

“Any time a new entertainment is starting up, it’s always going to be advertised toward young people,” Khoury-Boucher said, citing vaping as one example. “They weren’t looking for middle-aged people who’d been smoking for 25 years; they were looking at mid- to late adolescents. It’s kind of the same thing with sports gambling. If you’re a sports fan, you’re seeing advertising that looks like the old beer commercials — everyone’s happy, it’s exciting, it’s flashy. They’re targeting young people, and that’s potentially a problem.”

Indeed, SEIGMA’s study notes that sports betting occurs in all demographic groups but appeals most to young, well-educated men. It adds that problem gambling is higher among sports bettors primarily because they tend to be involved with a large number of other gambling activities, so legalizing sports betting in Massachusetts has the potential to increase rates of gambling harm and problem gambling.

To mitigate those concerns, SEIGMA is advising the Gaming Commission to require operators to provide player data to the MGC on a regular basis and to cooperate with researchers; to prohibit live, in-game sports betting, which is disproportionately utilized by problem gamblers; and to restrict advertising and celebrity endorsements, which tend to promote sports betting in young people, precipitate relapse in recovered gamblers, and counteract the effectiveness of messages advocating limited, lower-risk involvement.

Volberg noted that only four states have funded any kind of research about sports betting, while 12 have provided funding for problem-gambling services. This contrasts with Massachusetts, where 9% of the tax revenue raised from sports betting will go into the Public Health Trust Fund that supports research and services to mitigate gambling-related harms.

“We are in a unique position in Massachusetts to be able to monitor the impacts of sports betting as it becomes legal and make adjustments to its provision so as to maximize the benefits and minimize the harms.”

 

Sit Back and Watch

Those benefits, as noted, are uncertain, but operators are excited about the prospects.

For maximum economic impact, SEIGMA’s report recommends issuing licenses for online operators, and a variety of them, since most sports betting is done online. That lines up with the Gaming Commission’s plans.

“While it is likely that sports-book operators, including land-based and online operators, will benefit from sports-betting legalization in Massachusetts,” the study notes, “it is difficult to predict whether sports bettors will add legal sports betting to their repertoire or simply substitute betting on sports for spending on other types of gambling.”

Still, as the leader of the only casino in Western Mass., Kelley sees potential benefits not just for his facility, but for the region itself.

“Massachusetts residents are already driving across the border to Connecticut, Rhode Island, New Hampshire, and New York to place bets. Keeping the millions of tax dollars generated annually by sports wagering in the Commonwealth is a big deal,” he told BusinessWest. In addition, “sports betting at MGM Springfield will bring more foot traffic and visitors to downtown Springfield. We are thrilled at the prospect of not only having more people come and enjoy our property, but to experience all of the amazing businesses nearby.”

To enhance the viewing and gambling experience, the MGM Sports Lounge opened in August 2021, featuring more than 70 lounge seats and a 45-foot state-of-the-art HD viewing wall, inviting fans to watch multiple sporting events at once. A new VIP Sports Lounge also opened last August within TAP Sports Bar, offering a more intimate experience, including a state-of-the-art HD viewing wall.

“As a New England sports fan, I can tell you the MGM Springfield Sports Lounge is the best spot to watch the Patriots, the Red Sox, the Celtics, the Bruins, you name it,” Kelley said. “It’s also just a great place to gather with your friends for a fun night out. As soon as we get the green light, we are ready to incorporate the BetMGM platform into our property.”

Yes, the green light — it’s what many in the gaming industry in Massachusetts have been anticipating for a long time, hoping the benefits of legal sports betting exceed early projections — and outweigh the potential harms.

 

Joseph Bednar can be reached at [email protected]

 

The Dowd Agencies Expands Organically and Through M&A

By
Current and future leaders at the Dowd Agencies
Insurance Special Coverage

Putting a Premium on Measured Growth

Current and future leaders at the Dowd Agencies

Current and future leaders at the Dowd Agencies, from left: Evan Dowd, account executive; John Dowd Jr., president and CEO; Dave Griffin Jr., senior vice president; and Jack Dowd, vice president of Personal Lines.

There’s a framed picture of downtown Holyoke on one wall of the conference room at the Dowd Agencies — downtown Holyoke circa 1870.

The view is looking west along Dwight Street by the first-level canal. City Hall, prominent in the upper-left corner, looks … exactly as it does today. The other side of Dwight Street, not so much — most of the buildings seen in the image have been gone for decades. For perspective, a horse-drawn carriage is moving east down the hill.

John Dowd Jr. said the picture was owned by a long-time client who offered it to him after Dowd repeatedly raved about it. He accepted the offer and gave the picture a prominent home — across the conference room from another framed photo, this one of the insurance company’s founder, James J. Dowd, who went into business just a few decades after that picture of downtown was taken.

Together, the pictures provide some needed perspective — about time, Holyoke, the company, change, what hasn’t changed — and how they all come together. And the juxtaposition of all this will come into even sharper focus in 2023, when the agency, which Dowd claims is the oldest family-owned insurance agency doing business in the Bay State, celebrates its 125th birthday.

“We want to continue to grow, but want to make sure we’re not growing too quickly; we don’t want to get over our skis, as we like to say.”

There hasn’t been much hard planning about how to mark that milestone, he said, adding that he and others will pick up the pace in the coming months and put together some events and programs, as they did for the company’s centennial in 1998.

“We have a few things we’re planning that are in the works,” he said. “We’re trying to do some things that involve the community; overall, it’s an opportunity for us to say ‘thank you’ to the community for supporting us for 125 years and through five generations. That’s an important ‘thank you,’ and we’re thinking long and hard about what we’re going to do.”

In the meantime, the company is taking steps to ensure that it can continue its long history as an independent agency, said Dowd, noting, for example, the latest in a series of recent acquisitions that provide needed size and flexibility at a time of continued consolidation in the insurance industry.

Just last month, the firm acquired the Ideal Insurance Agency in Ludlow, which, like many smaller, family-owned agencies in the area, became available for one of many reasons, ranging from COVID-19 to lack of a clear succession plan to the inability to effectively compete in a market increasingly dominated by larger firms.

photo of downtown Holyoke, circa 1870

This photo of downtown Holyoke, circa 1870, has earned a spot on the wall in the conference room at the Dowd Agencies.

This was the third such acquisition over the past two years, coming after Dowd bought the J. Raymond Lussier agency in West Springfield and the Wilcox agency in Westfield and Feeding Hills. This expansion has given the agency much greater size, and in insurance, as in banking and most all other sectors, size matters, and it bring benefits.

“The advantages come with volume with carriers,” Dowd explained, noting that the firm is roughly 30% larger than it was a few years ago, and almost double the size it was a decade ago. “The more volume you have, the better compensation you negotiate, as well as profit sharing, services, and other perks. We’ve been able to achieve some of that volume leverage through aggregation with other agencies and through M&A.”

Moving forward, the agency will continue to look for opportunities for growth organically, and also through additional acquisitions, said Dowd, adding that it approaches this assignment with an eye toward smart growth and not taking on too much too quickly.

“We want to continue to grow, but want to make sure we’re not growing too quickly; we don’t want to get over our skis, as we like to say,” he noted, borrowing a phrase used often in business to connote getting ahead of oneself with a specific strategic initiative. “A healthy company grows organically and also through M&A. With the M&A, it has to be measured growth, but organic growth is essential — that’s boots on the ground, bringing in new clients, retaining your current clients; that’s good, healthy growth, augmented by acquisition, which comes with debt, which obviously has to measured and balanced.”

Meanwhile, there are other matters to consider, said Dowd, including succession planning for this agency, something that is obviously taken seriously at a company that has been around this long, covets its independence, and wants things to stay that way.

For this issue and its focus on insurance, BusinessWest talked with Dowd about … well, everything conveyed by those two photos in the conference room.

 

Cover Story

Dowd told BusinessWest that the phone calls come maybe once a week, or five or six times a month on average.

They’re from representatives of private-equity firms who want to know if Dowd Insurance might be for sale, and, if so, under what circumstances. He tells them ‘no,’ and in a polite way — at least the first time they inquire.

“I’ll usually have one conversation with them and let them know that we’re not interested in selling and are happy to stay the way we are. And then when they call the next month with the same question, my patience starts to wane, and I start to wonder about how obligated I am to answer every email and every phone call, especially when I’ve already talked to them and told them my plan.”

“They are relentless,” said Dowd of those on the other end of the phone. “I’ll usually have one conversation with them and let them know that we’re not interested in selling and are happy to stay the way we are. And then when they call the next month with the same question, my patience starts to wane, and I start to wonder about how obligated I am to answer every email and every phone call, especially when I’ve already talked to them and told them my plan.”

These days, there are even more people calling and asking about the agency, he noted, and that’s because of those acquisitions over the past few years and the scale they generate.

It’s a somewhat minor annoyance, and at the same time a reminder of the agency’s track record for success, he said, adding, again, that he is polite, but only to a point.

Dowd has other matters to occupy his time, he noted, adding that, overall, the firm is still trying to make its way all the way back to where it was before the start of the pandemic, especially with “behind-the-scenes” work, as he called it, when it comes to quality, efficiency, and serving clients.

“We have a quality team that evaluates what we do and how we do it,” he explained. “They would get suggestions every month from anyone on the staff — ‘here’s an area that I think we can look at and get better at’ — and the quality team would research and come to us with suggestions for developing a plan. That’s an example of an area where we lost some momentum.”

Some momentum was also lost when it came to connecting with potential new customers, he went on, adding that this put far greater emphasis on growth through acquisition, which is exactly what the company did.

“From a revenue standpoint, we were flatlining — if we held onto everything,” he explained. “And we didn’t hang onto everything because businesses were closing. It was a scary time because there was so much uncertainty. But then came the M&A opportunity, and we looked at it and said, ‘this is not a great time to be taking on some debt, but we think this is prudent.”

John Dowd Jr., seen here next to a photo of the company’s founder, Joseph Dowd

John Dowd Jr., seen here next to a photo of the company’s founder, James J. Dowd, says the Dowd Agencies targets controlled, ‘smart’ growth, both organically and through acquisition.

Elaborating, he said the agencies that came into consideration were good fits, culturally and otherwise, and under normal circumstances, they would be consider logical acquisitions. The circumstances weren’t normal, but the times dictated some aggressive action.

“Sometimes you’ve got to stick your chin out there and, when opportunity knocks, take advantage of the opportunity,” he said, adding that this is just what the firm has done.

In doing so, it has put itself in and new different position — an independent agency of considerable size — and it is determined to sell both of those qualities.

“We’re a good-sized agency, certainly in Western Mass., and the only one of our size that is still independently owned — not owned by one of the big guys,” he said. “We like that distinction, and we use it to our advantage. We’re totally local — not only do we live and participate in our community here, we’re also locally owned, and profits go right back here in to Western Mass., and not Chicago or anywhere else.”

But with that independent status comes the challenge to compete with those often much larger concerns, Dowd explained, adding that this challenge, as in banking and other sectors, is very real and becoming more stern with each passing year.

“We’re at a point now where getting to the next level requires a higher level of sophistication in just about every area,” he said. “Obviously, technology is huge because it creates the efficiencies we need. Meanwhile, the labor market is extremely difficult and challenging right now.

“The investment in technology and the way we staff ourselves, the levels of management … all of these important areas have to be looked at and adjusted accordingly,” he went on. “You can’t keep doing things the way you were when you were half the size. You have to be forward-thinking in this business; you have to be looking ahead and be prepared for what may come, and you know the unexpected will happen. You have to be nimble enough to be able to adjust.”

 

Prudent Policy

As he looks forward, Dowd sees the agency doing what it has been doing all along and especially over the past decade or so — seeking to grow organically, but also looking for opportunities to grow through acquisition and expand geographically.

The agency currently has nine locations, all in Western Mass., but it is exploring options well beyond this area code, he noted.

“We’ve looked at Northern Connecticut, we’ve looked at acquisitions in Vermont and New Hampshire, and we’ve also looked at Eastern Mass., toward Worcester, working our way in that direction,” he said, adding that, while the agency serves clients in those areas and others, including Boston and New Jersey, it does not have a physical presence in those locations, but could attain some if the conditions are right.

“In our business, it’s about where your network of contacts takes you and what your appetite for challenge is,” he told BusinessWest. “Do you want to do what it takes to be regional and available and able to support services? You just have to be realistic that you can do what you say you can do.

“We’re careful and selective with regard to companies where there’s some distance,” he went on. “But we’re looking at some relationships in New York right now where we could possibly have an ofice and be able to operate similarly, but on a smaller scale, to what we’re doing here.”

Overall, there are a number of ways to get to the proverbial next level in terms of size and revenues, he went on, adding that, while remaining independent is the preferred route, the agency will consider all its options. “We’re evaluating what steps we need to take in order to continue to grow and build the company.”

Returning to those phone calls he gets from the private-equity firms, Dowd noted, again, that he doesn’t take many of those calls anymore.

“I feel bad about that, but not too bad,” he explained. “I get a lot of messages — they call and they say they’re from such and such firm, and he’s calling again; I talked to him a year or two ago and told him I’ll call if anything changes.”

Nothing has really changed, at least on that front, he went on, adding that there has certainly been change with regard to the company’s size, reach, and position among area agencies.

Over the course of 124 years, many things have changed, but the most important ingredient hasn’t — this is still an independent, family-owned agency.

And as it prepares to mark another important milestone, that’s a quality worth celebrating.

 

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

South Hadley Utility’s Fiber Business Is a Fast-developing Story

By
SHELD General Manager Sean Fitzgerald
Special Coverage Technology

A New Gig

SHELD General Manager Sean Fitzgerald

SHELD General Manager Sean Fitzgerald

‘Ahead of schedule and under budget.’

Those are the words that any business owner or board of directors would love to hear regarding a specific project or undertaking. They are not heard often, to be sure, and they are being heard even less frequently, if at all, in these days of soaring inflation, supply-chain issues, and a workforce crisis.

But that phrase can certainly be applied to the ongoing work of the South Hadley Electric Light Department (SHELD) to provide commercial and residential customers in that community with fiber internet service, a project that had the additional challenge of being launched only months before the pandemic arrived in Western Mass.

“In the last financial report we gave to the board, we were under budget and ahead of the construction schedule,” said Sean Fitzgerald, SHELD’s general manager, noting that roughly 75% of the town now has fiber service, with the rest to be built out by July 2024.

The fiber program, which had been known as Fibersonic, has been rebranded as Fiberspring to avoid any potential problems with another internet provider using ‘sonic’ in its name, said Fitzgerald (more on this new name later). It now boasts more than 1,600 customers, including residents, businesses, municipal entities, public schools, and the majority of town departments, and to say the initiative has been successful and is turning some heads would be an understatement.

Indeed, the early success in South Hadley has led to new agreements to provide internet service to nearby towns Leverett and Shutesbury, and inquiries from, and preliminary talks with, other communities, said Fitzgerald, adding that SHELD’s board of directors must now decide just how entrepreneurial it wants to be with this product.

Indeed, the Fibersonic program, similar in many ways to a fiber initiative launched by Westfield Gas & Electric — which Fitzgerald was part of — was initiated with the simple goal of providing better, more reliable service to South Hadley residents and businesses. But its pattern of success, the new contracts with Leverett and Shutesbury, and the potential to add more small towns and even larger communities (there have been talks with Easthampton) have the potential to turn this into a dynamic new profit center for SHELD.

“Customers are streaming more; they’re going into Best Buy, they’re buying a TV that is all streaming,. And with the internet of things, with everything from doorbells to vacuum cleaners connected to the internet, people are increasingly concerned about bandwidth and performance.”

“Originally, the vision from the board was not to expand; it was to improve quality of life for residents of South Hadley — that was the initial plan,” Fitzgerald said. “But in doing that, other towns became aware of us being an option; we did it very well, and we did it to what I would call the gold-standard level, so these expansion opportunities have fallen into our lap.”

SHELD has scheduled a strategic planning event for October, at which discussions will be had about where the utility can go from here with its fiber endeavor and whether further expansion should be pursued.

“That’s a discussion point that the board and I will have to have — how aggressive should we be as a municipal light plant in going after expansion of fiber?” he said, noting that, with scale, the utility can ultimately reduce the cost of the service it provides. “And these are questions we don’t have full answers to yet.”

For this issue and its focus on technology, BusinessWest talked with Fitzgerald about what is now officially known as Fiberspring (the recently detailed trucks with the brand can be seen on the roads), and what the next chapters in this intriguing story might be.

 

A New Gig

‘Big Gig.’ ‘Fiber Galaxy.’ ‘Gazoo.’

Yes, Gazoo, the extraterrestrial character from the old Flintstones cartoon show.

These are just some of the dozens of names Fitzgerald and his team at SHELD considered as they went about rebranding Fibersonic in conjunction with Darby O’Brien Advertising, the South Hadley-based firm that has developed a strong reputation for helping businesses and nonprofits with such endeavors.

As they talked about the process, Fitzgerald and O’Brien said potential new names would be tossed around, with their merits and shortcomings weighed, before most all of them would have to be discarded because they had been completely, or partially, trademarked by someone else. Such is the growth of this sector of the economy, where the word ‘fiber’ has been attached to just about every conceivable noun.

one of utility’s trucks with the new brand, Fiberspring

General Manager Sean Fitzgerald shows off one of utility’s trucks with the new brand, Fiberspring.

Oddly, and both O’Brien and Fitzgerald thought it was odd, and that’s why they made very sure that Fiberspring was not trademarked. That’s the colorful brand name — literally and figuratively — now, or soon to be, seen on trucks, business cards, letterhead, and everything else.

By whatever name it goes, South Hadley’s new telecom business has become an intriguing success story, one that begins with SHELD’s hiring of Fitzgerald in 2017 with the intent of launching a business division to bring fiber to the home. As noted, Fitzgerald had been working for Westfield G&E and had developed the business component for that municipal utility’s Whip City Fiber project.

What eventually emerged in South Hadley was a $17.4 million initiative, said Fitzgerald, with roughly $15 million going toward fiber construction, with the other $2.4 million in funding needed for advanced meter infrastructure, or AMI. It was financed mostly through a $12 million bond secured through the Massachusetts Municipal Wholesale Electric Co. at a favorable 2.7% rate.

As he assembled a team to take this new business division, named Fibersonic, off the drawing board and make it reality, Fitzgerald borrowed from the successful Whip City model in many respects.

These include everything from ordering materials well in advance — a strategy that has brought dividends in these times of supply-chain issues and soaring prices — to the concept of ‘fiberhoods’ — bringing fiber to a community neighborhood by neighborhood.

As he gestured to a map of the town on a large screen in the SHELD conference room, Fitzgerald noted that there are many fiberhoods in South Hadley now, with those currently without fiber to be completed by 2024.

As neighborhoods become fiberhoods, the ‘take rate,’ as it’s called, a statistic that tracks how many households are signing up for the service, is roughly 43%, a good number that grows higher as more residents add the gig-speed service and word of mouth spreads about its speed and reliability.

And as more and more household devices and appliances are driven by the internet — everything from lighting to security to thermostats — demand for fast, reliable service grows.

“Customers are streaming more; they’re going into Best Buy, they’re buying a TV that is all streaming,” he noted. “And with the internet of things, with everything from doorbells to vacuum cleaners connected to the internet, people are increasingly concerned about bandwidth and performance.”

As for ordering materials ahead of schedule, that has been one of the keys, along with a solid team, effective buildout strategy, and staying under budget and ahead of schedule, Fitzgerald said.

“We proactively ordered our equipment and materials in advance, before we knew COVID was coming,” he explained. “I learned that in Westfield, and it was a great strategy.”

As South Hadley adds more fiberhoods, it’s becoming apparent that SHELD’s fiber-service initiative could expand well beyond the borders of that town.

Indeed, just as Whip City Fiber has moved beyond Westfield and into the surrounding hilltowns, Fiberspring is now expanding into other communities.

Shutesbury, northeast of South Hadley, was the first town to enter into a contract with the company, and Leverett, which borders Shutesbury, followed soon after. Those two communities, which both had existing networks in place, will bring another 3,000 customers into the fold.

After that … Fitzgerald said there is potential to expand the footprint in several directions.

“We could go pretty much anywhere in this region,” he told BusinessWest. “The key is the truck rolls — if you have to roll a truck to a customer, you need to be able to reach that customer in a reasonable period of time. If a town in New Hampshire or Maine wanted to hire us, we could do it, but we would probably have to put a satellite building there or a small hub or hire technicians that live in that area.

“Just as Westfield is now serving a number of hilltowns, we can now do the same,” he went on, adding that Fiberspring is now competing with Westfield and other providers. “These towns chose us because of our team and our ability to serve them.”

Moving forward, Fitzgerald said there will be several factors that will determine if, when, and to what degree Fiberspring expands.

“First and foremost, we don’t want to negatively impact the service that we provide to South Hadley — those customers are priority one,” he explained. “Second, we want to make sure we have enough resources to adequately perform any of those contracts. And third, does it make sense for our customers? The whole reason we’re doing this is to reduce the cost to the South Hadley customers and at the same time provide a good service to Shutesbury. But ultimately, we need to show cost savings for South Hadley customers, who are our owner, which we will do with these contracts.”

 

Speed Thrills

Summing up where the telecom business now known as Fiberspring is, and where it could be a few years or a decade down the road, Fitzgerald said everything is happening faster than he or the SHELD board anticipated.

That statement goes for everything from the buildout in South Hadley — again, it’s ahead of schedule — to the expansion of the business into neighboring communities.

That’s a good problem to have — if it’s even a problem — and a business story that bears watching in the months and years to come.

In other words, this new gig — as in gig — has vast potential to be a huge player in this market.

 

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

Pandemic’s Over, but Challenges Remain

By
Opinion

Editorial

 

President Joe Biden famously, and matter-of-factly, announced recently that the pandemic is “over.”

Whether that’s true or not remains to be seen, but what isn’t in question is the fact that, while the pandemic may indeed be a matter for the past tense, businesses large and small continue to face a mountain of challenges, many of them stemming directly or indirectly from the pandemic.

This much was made clear in a recently released MassINC survey that revealed, among other things, that just over half the businesses polled, 53%, are reporting revenues lower than before the pandemic.

Meanwhile, inflation is at a 40-year high, supply-chain issues persist, a labor shortage continues, the Great Resignation is far from over, and now there is apparently a new workforce issue to contend with — so-called ‘quiet quitting,’ whereby employees don’t officially leave their jobs; they just do the bare minimum.

We’re not sure if quiet quitting is a byproduct of the pandemic or not — it’s a relatively new phenomenon, and there is not much data on it — but just about everything else is, from inflation to the supply-chain issues to the persistent problems companies are having with staffing up.

So while it’s good to hear that the pandemic is over — at least in a technical sense; we’re now told that COVID is in the same category as the flu — the ‘normal’ that everyone in the Western Mass. business community was seeking ever since we first heard of COVID seems like it is still a long way off.

Especially with growing talk about a recession, when it will come, how severe it will be — and whether or not we are already in one, which many economists already believe we are, as well as headlines about soaring energy costs and escalation of fighting in Ukraine.

Maybe the biggest issue, though, is the Federal Reserve’s ongoing fight against inflation. The Fed recently raised interest rates again, this time by three-quarters of a point for the third straight time, an aggressive tactic that might — that’s might — bring inflation back down to its 2% goal, but at a potentially high cost when it comes to the economy and the plight of businesses large and small.

Indeed, the tactics used to fight inflation may well tip the economy into a recession and, in the meantime, make it harder for businesses to attain the capital they need to expand, prompting more job cuts; many businesses have already gone from hiring to laying people off. Fed policy makers are projecting that the jobless rate will reach 4.4% by the end of 2023, up from its current level of 3.7%.

Overall, the cure may be worse than the disease, as the nation witnessed 40 years ago, when, to tame inflation, the Fed pushed the country into a protracted recession.

President Biden also said recently that he believes that a “soft landing” is possible for the economy. Perhaps, but many economists are predicting a much harder fall.

That’s not what area business owners want to hear after two and a half long years of battling the pandemic and its many side effects.

Technically speaking, the pandemic is over, but the challenges remain. We said back in March 2020 that the local business community was resilient and up to the challenge. We still believe that, but this resilience is certainly being tested, and the quest for normal — whatever that is — goes on.

Incorporations

By
Incorporations

The following business incorporations were recorded in Hampden, Hampshire and Franklin counties and are the latest available. They are listed by community.

AGAWAM

Nakaru Trans Inc., 238 Cooper St., Agawam, MA, 01001. Alexander Gribanov, same. Transportation services.

AMHERST

PGD Foodie Group Inc., 200 West Pomeroy Lane, Amherst, MA 01002. George Ducharme, same. Restaurant.

CHICOPEE

M & V Cleaning Services Corp., 55 Gilmore St., Chicopee, MA, 01013. Wilton Da Silva, same. Janitorial cleaning services.

Nesterchuk Home Improvement Inc., 280 College St., Chicopee, MA, 01013. Nikolay Nesterchuk, same. Home Improvement.

EAST LONGMEADOW

Apollo Medical Inc., 127 Country Club Dr., East Longmeadow, MA, 01028. David Laporte, same. Medical device sales.

EASTHAMPTON

Strategic Consulting Solutions Inc., 147 West St., Easthampton, MA, 01027. Loren Davine, same. Consulting services.

GREENFIELD

M2B Home Delivery Inc., 139 Silvio O. Conte Dr., Greenfield, MA, 01301. Adam J. Provost, same. Retail sales.

HOLYOKE

Restaurante La Isla Corp., 161 High St., Holyoke, MA, 01040. Yanercy Diaz De La Cruz, same. Restaurant.

LUDLOW

Iglesia El Candelero De Dios, 182 Howard St. Apt 1R, Ludlow, MA, 01056. Gerson Crespo, 83 Windsor St. Ludlow, MA 01056. Religious organization designed for the purpose to train leaders, teach bible, preach the gospel and serve the needs of the community.

MONTAGUE

Project Nadiya Inc., 70 Main St., Montague, MA, 01351. Nadezhda Tkachenko, same. Build, refurbish and manage housing in the Ukraine and surrounding countries for the purpose of providing shelter for displaced persons impacted by war and unrest.

PITTSFIELD

Easnott Inc., 987 North St., Pittsfield, MA, 01201. Desiree Eason, same. 24-Hour community care services.

Marvelous, Elegant, Lifestyle (M.E.L.) Inc., 82 Wendell Ave. Suite 100, Pittsfield, MA, 01201. Matsuko Leathers, same. Elegant lifestyle.

SS Productions, 82 Wendell Ave., Suite 100, Pittsfield, MA, 01201. Sarah Seymour, same. Media production and art services.

SOUTH DEERFIELD

Soulive Music Group Inc., 2B Duncan Dr., South Deerfield, MA, 01373. Alan Evans, same. Music performances and recording services.

SOUTHAMPTON

Hypnosage Inc., 4 Manhan Road, Southampton, MA, 01073. Saskia Coté, 510 Blisswood Village Drive Ludlow, MA 01056. Alternative therapy and retail products.

SPRINGFIELD

All Empire Inc., 172 Lebanon, Springfield, MA, 01109. Robert Elliotte Flowers, same. Home improvement services.

Pacc Transition Inc., 819 Worcester St., Ste. 1, Springfield, MA, 01151. Adnan Dahdul, same. Holdings company.

Shida Inc., 590 Boston Rd., Springfield, MA, 01119. Awel Mehemed-Aman Adem, 51 Washington Road, Springfield, MA 01108. Convenience store.

Youth Educational Services Inc., 174 Marion Street Unit 2, Springfield, MA, 01109. Sonya Barber, P.O. Box 90933 Springfield, MA 01139. Tutoring for youth and young adults. Assisting high school students in applying to colleges or technical schools.

WESTFIELD

Bee-Shine Spa Inc., 38 Salvatore Dr., Westfield, MA, 01085. Magali Vinces, same. Nail salon and spa.

O.J.M. Pik Reno Corp., 3 Lozier Ave., Apt 1, Westfield, MA, 01085. Oleh Pikulskiy, same. Construction services.

Boos E-Bikes Inc., 9 Old Orchard Road, Wilbraham, MA, 01095. Mirian Santos Costa, same. Retail sales of motorcycles and scooters.

It’s Still an Economic Driver, While New Law Addresses Thorny Issues

By
Aaron Vega
Cannabis Special Coverage

Cannabis in Flux

Aaron Vega

Aaron Vega says cannabis has been a definite economic driver in Holyoke’s downtown and canal district.

 

According to the Cannabis Control Commission (CCC), legal marijuana is now an annual $3 billion business in Massachusetts.

The communities that have embraced it from the beginning, like Holyoke, can attest to cannabis as an economic driver in terms of commercial real estate, jobs, and other opportunities. The city now has four dispensaries, three grow facilities, and a testing lab up and running, with dozens of other applications at various stages of the permitting process — a process, city Planning & Economic Development Director Aaron Vega said, that was always intended to be easy to navigate.

“This community voted in favor. The mayor was in favor. As a state representative, I was in favor. And we didn’t want to make it more difficult. It was challenging enough with the regulations coming down from the state. We saw this as an industry that could take over some vacant and underutilized buildings, and that’s what informed how we went forward.”

That has indeed occurred. “We’re very excited about the investment that has happened — tens of millions invested in these downtown buildings because of cannabis, and 500 jobs that didn’t exist three years ago,” Vega said, noting that the cannabis enterprises themselves aren’t an endgame, but a way to spur even more investment.

“What do you do with 500 people? You make sure they’re going to your concerts, going to your restaurants and events, utilizing your local food trucks. And then there’s the ancillary businesses to the cannabis industry; how do we lure them to the city and make it even more beneficial for companies to do business in Holyoke?”

Other cities and towns have, to varying degrees, told similar stories. But the host-community agreements they’ve put forward have not always been well-received, and that was one of several issues addressed last month by a multi-faceted cannabis bill passed overwhelmingly by the state Senate and House of Representatives and signed into law by Gov. Charlie Baker.

“We saw this as an industry that could take over some vacant and underutilized buildings, and that’s what informed how we went forward.”

Among its main elements, the law clarifies the host-community agreement (HCA) process by authorizing the CCC to prioritize social-equity program businesses and economic-empowerment priority applicants for expedited review.

It also clarifies the scope of HCAs and adds new criteria, mandating that no host-community agreement can include a community impact fee that is beyond the business’s eighth year of operation, the community-impact fee must be reasonably related to the actual costs required to operate a cannabis business in a community, the CCC must review and approve each HCA as part of the license application and renewal process, and all host communities must establish procedures and policies to encourage full participation in the regulated marijuana industry by people from communities that have been disproportionately harmed by marijuana prohibition and enforcement.

“Communities of color across our country have historically been criminalized, prosecuted, and left out of the conversation in regards to cannabis legalization,” state Sen. Adam Gomez said. “When cannabis was legalized in Massachusetts, those same communities continued to be barred from the conversation table and left behind, with historic barriers preventing them from growing small businesses in meaningful ways. The legislation passed by the legislature will remove those barriers.”

The law also expedites the expungement process, Gomez noted. For individuals seeking to expunge a record for previous offenses that are now decriminalized, the law requires the court to order the expungement of the record within 30 days of the request and expunge records for possession or distribution of marijuana based on the now-legal amount.

“It is incomprehensible that anyone who was charged with a marijuana-related offense still has that on their record in our state, especially when you can drive down the street to a dispensary to buy the same product that that person was arrested for,” Gomez said. “I was proud to support this legislation and can’t wait to see cannabis businesses run by BIPOC owners flourish as a result.”

 

Growing Pains

The law makes other major changes as well, including a clarification of the local social-consumption approval process.

The advent of what’s known as cannabis cafés will give renters, public housing tenants, and tourists a legal place to use a legal substance. Under this legislation, a city or town may allow for social consumption sites through the passage of a bylaw or ordinance.

The legislation also creates a trust fund to make grants and loans to social-equity program participants and economic-empowerment priority applicants, which will give entrepreneurs from communities that have been disproportionately harmed by marijuana prohibition and enforcement better access to grants and loans to get their businesses off the ground.

In addition, 15% of the revenue collected from the sale of marijuana and marijuana products must be transferred to the Cannabis Social Equity Trust Fund, which will be administered by the Executive Office of Housing and Economic Development in consultation with a newly created Cannabis Social Equity Advisory Board.

“It is incomprehensible that anyone who was charged with a marijuana-related offense still has that on their record in our state, especially when you can drive down the street to a dispensary to buy the same product that that person was arrested for.”

“This legislation will create a more equitable cannabis industry in the Commonwealth,” said state Sen. Jo Comerford, noting that lawmakers “approached this issue with expertise and compassion, and the resulting bill will bring more diversity and equity to this industry.”

House Speaker Ronald Mariano added that “the passage of this legislation will help to ensure that those who have been historically impacted by marijuana prohibition can find new opportunity in the emerging industry. This legislation will help to support folks who have faced generations of inequality secure the needed capital to launch a cannabis business.”

The loan fund highlights one of the challenges of starting a business that’s technically illegal under federal law. Although there have been rumblings that the U.S. Congress could move to decriminalize cannabis and open up traditional financing to such businesses, nothing has been done so far.

“It’s still a hard-money business,” said Tim Sheehan, chief Development officer for the city of Springfield, and that affects both entrepreneurs and property owners. “That’s challenging from a real-estate standpoint. If that were to change, it would provide a more stabilized financial underpinning for the industry itself, and obviously, that would translate into folks that have space feeling far more comfortable in terms of the security they have relative to leasing and everything else. It would be accepted in the mainstream financial market.”

While Springfield didn’t embrace cannabis in the unfettered way Holyoke did — the city has put forward two rounds of retail applications and one for a grow facility, but that project, by Page Cultivate LLC in East Springfield, was derailed by the City Council in May over a site-plan change and other concerns — many of its leaders recognize the economic value of the burgeoning industry.

“Once it was legalized, there was clearly a focus on it becoming an economic benefit for the city,” Sheehan said. “Much like when gaming was legalized, we looked to see what the economic potential of the cannabis industry would be relative to both city finances and economic impact in terms of the marketplace.

“Much like when gaming was legalized, we looked to see what the economic potential of the cannabis industry would be relative to both city finances and economic impact in terms of the marketplace.”

“Obviously, the industry has had an impact on storefront and warehouse space, and I would quantify that as a positive impact,” he went on, adding that it remains to be seen what kind of impact the cannabis trade will have on the surrounding residential real-estate market.

“Caution is the watchword. As an industry, it remains to be seen what the saturation point is, and I really think that needs to be factored in through the process with regard to how many of these establishments you’re going to allow, whether it be a grow facility or how many retail establishments you’re going to allow. There is a limited market.”

 

In the Weeds

The cannabis industry’s potential is still unknown, though the early results in terms of new businesses, tax revenues to communities, and jobs have been positive.

But Sheehan is right that no one really knows what the saturation point is, if there is one. And the Legislature’s sprawling cannabis bill last month was an admission that plenty about the permitting process — especially for traditionally disenfranchised communities — needs to be addressed.

As Senate President Karen Spilka put it, “I am thrilled we were able to reach a deal on this bill, which will take meaningful steps toward ensuring communities who have historically been harmed by marijuana criminalization can access resources to enter this industry.”

 

Joseph Bednar can be reached at [email protected]

Are Flood Zones Reliable? And Are You Covered?

By Contributor
Insurance

Water, Water Everywhere

By Peter Normand

 

According to a 2020 report from the First Year Foundation, there were 336,000 properties in Massachusetts alone that were at some level of risk for flooding. This number is 65% higher than the existing flood maps indicate.

The heavy rains of last summer and the claims that followed got me wondering what the future holds. We are beginning to feel the impacts of climate change in more severe and less predictable weather. How valid are our flood maps? What can property owners do to protect their property in an uncertain future? If you haven’t talked about flood insurance with your insurance agent yet, now is the time.

Banks require flood insurance on all properties that are located in a flood zone per existing flood maps. Why do they do this? Commercial and homeowners policies exclude flood as a cause of loss. Nearly all of my commercial insurance clients who have flood insurance have purchased it to satisfy a loan requirement. Nearly everyone else is rolling the dice — most stating that, since they aren’t in a flood zone, it’s not an issue. After a very wet summer of 2021, however, the conversation is changing, even if this summer has been drier.

Let’s start off by defining what a flood is. Floodsmart.gov notes that “flood insurance covers losses directly caused by flooding. In simple terms, a flood is an excess of water on land that is normally dry, affecting two or more acres of land or two or more properties.” Just because there is water in your basement doesn’t mean it’s a flood. In fact, water seeping into a foundation without the above definition being met would not be covered by flood insurance. When determining whether or not there is coverage, the cause of the flooding that damages your property does matter.

On the market side, there are more options than ever, with more carriers offering a flood product. This leads to more flexibility for our insureds. For example, some markets allow for multiple properties on a single policy, some carriers offer limits in excess of NFIP (National Flood Insurance Program) limits to adequately insure the value of the property, there are replacement cost (RC) and actual cash value (ACV) valuations, and more competition has created market pressure on premiums, especially for properties outside of flood zones.

With changing weather patterns and other unknowns, it’s reassuring to know that there are options. If you haven’t considered flood insurance in the past, or have been putting it off, now is the time to talk to you insurance agent. There is an expanding market with options to meet your specific exposures and needs.

 

Peter Normand is a Commercial Lines account executive and RiSC consultant with Webber & Grinnell Insurance.

Senior Planning Guide 2022

By
Guide to Senior Planning Special Coverage Special Publications

Preparing for Life After 65

View the 2022 Planning Guide HERE

When people think about strategizing for their senior years, they often see it as a downbeat task, one marked by growing incapacity, financial stress, and, well, dying.

That’s not what this guide is about, although it definitely contains plenty of information about what to do before that day comes. But the goal isn’t planning to die; it’s making sure you get all your plans in order — from where you or your loved ones will live to how finances will be distributed — so you don’t have to worry about it. You can, instead, enjoy life.

 

And that planning is an increasingly important task. According to the U.S. Census Bureau, the number of Americans age 65 and older rose from 35 million in 2000 — 12% of the population — to 56.1 million, or 17%. By 2030, the bureau estimates, more than 21% of U.S. residents, about 73.1 million, will have passed their 65th birthdays.

That’s a lot of people. And a lot of planning. And a lot of living left to enjoy.

Achieving your goals — and your desires for your loved ones — requires careful thought, and that’s where our annual Senior Planning Guide comes in. So let’s sort through some of the confusion and get those conversations — and the rest of your life — started.

 

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