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Opinion

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Opinion
Social Security: A Modest Suggestion

By BEN BRANCH

The U.S. retirement system is beset with challenges. First, the shift from defined-benefit to defined-contribution plans coupled with low contribution rates and poor investment performance means many will have inadequate resources at retirement. Second, longer life expectancies and declining birth rates are increasing the ratio of retirees to workers. Third, the Social Security trust fund is projected to run dry in about 20 years.

The present system does provide a comfortable retirement for those with generous coverage under the remaining defined-benefit plans as well as for those with large sums in their defined-contribution accounts or elsewhere. Those having modest pre-retirement incomes may, however, have little or nothing built up in their retirement accounts. They must largely look to Social Security, which was not designed to be their sole support.

Moreover, unless something is done about it, the Social Security System will in the future be unable to continue to fully fund its payment obligations.

Suggested approaches include increasing the Social Security tax rate and/or increasing the standard retirement age (very difficult politically). Moreover, a higher standard retirement age would force everyone to defer retirement or accept a lower benefit when many people are physically unable to continue working. And even if something is done to improve the system’s finances, that would not necessarily address the problem facing those who retire with too little put aside to live comfortably.

Under the current system, those over age 62 who wish to retire prior to their standard retirement age (66 for most people) must do so at a reduced benefit rate. If, however, they are willing to defer drawing benefits beyond their standard retirement age, their benefit rate increases by 8% for each year they defer up to their 70th birthday.

Note, however that each additional year deferred has a greater impact in terms of reducing the post-retirement payments. A 66-year-old with a 20-year life expectancy who defers a year reduces the years of drawing benefits by 1/20th. One who defers one more year, five years later, with a 15-year life expectancy, has reduced the remaining years of drawing benefits by 1/15th.

To the extent that people can be induced to defer their retirement, our Social Security system benefits both from the additional tax revenues and from the years for which benefits are not paid. Similarly, the overall economy benefits from the additional production of those who continue working. Even the Medicare system would benefit to the extent that those covered by their employer would defer signing up for Medicare.

Clearly, increasing the propensity of people to defer their retirement has many pluses for both the individual and the economy. Can such deferrals be increased? I suggest the following ways for encouraging people to defer their retirement:

• Allow the benefit rates to continue to increase for those who wish to defer retirement past age 70;
• Allow retirees the option of drawing partial benefits while the percentage of benefits that are deferred continue to be increased;
• Promote SSI-benefit-payment deferrals with an education campaign; and
• Encourage additional years of deferral by increasing the rate of increase in the benefit. For example, benefits could be increased by 7% for the first year, 7.5% in the second, 8% in the third, and so on. This process would reflect the advantage to the system for people retiring well past age 66.

Clearly, increasing retirement deferrals would reduce the payments going out while increasing the funds coming in to the Social Security trust fund. Once benefits begin, the benefit rate will be higher, but paid for fewer years. Thus, the total amount paid out may not be very different from what would have been paid out without the deferral. Indeed, the overall economic system would also have been helped out by the tax payments resulting from the additional years of working.

This modest proposal would not only allow, but encourage those who are able to do so to continue to work productively well past the standard retirement age, without forcing continued employment on those who would find such a requirement onerous.


Ben Branch is a professor of Finance at the Isenberg School of Management at UMass Amherst; [email protected]

Creatively Carving the IT Budget Pie

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Sections Technology
Effective Planning Can Turn an Obstacle into an Opportunity

By GREG PELLERIN

Greg Pellerin

Greg Pellerin

“The budget evolved from a management tool into an obstacle to management.”

Former U.S. Secretary of Defense Frank Carlucci was talking about government spending when he made this comment, but he may as well have been referring to those days leading up to the start of a new business budget year. It’s that time when executives go scrambling to either spend what’s going to be lost or, more than likely, find more money to fund an important project.

There is no shortage of priorities for most IT departments. Strategic initiatives, the need for infrastructure upgrades, and software-licensing mandates are a constant challenge. Yet, hiring freezes and the redirection of funding within an organization often make implementation difficult. In my opinion, the answer to those once-a-year budget woes can often be found in four areas: prioritization, funding, implementation, and monetization.

 

Prioritization

It seems simple, but you’d be surprised by how many times the cart is put before the horse.

Virtualizing desktops and networks is a major investment with a cost-saving upside, but unless a company has clearly defined its ‘bring-your-own-device’ policy, a VDI plan shouldn’t even be considered.

Moving the data center to accommodate growth? Carefully and objectively reviewing hyper-convergence and public cloud potential is critical, because the best time to implement any or part of this solution is during a data-center migration/upgrade.

Perhaps it’s time to get rid of that old PBX phone system and institute a truly unified communications approach. By their very nature, VoIP solutions are software-based and are meant to evolve as business priorities change. A new, unified communications platform with the latest videoconferencing, instant messaging, and speech-enablement capabilities may be overkill and a real budget buster (you can always add capabilities later on).

Prioritizing actual versus perceived needs is the better course of action.

 

Funding

Critical IT investments can often be made by simply finding creative ways to reduce or redeploy existing budgets. A telecom-expense-management audit (often funded by the savings it incurs) takes a look at existing wireline and wireless contracts and often reveals thousands of dollars, if not tens of thousands, in unnecessary broadband spending. One of our clients was being charged $10,000 a month for a high-speed connection to an office they had closed years before!

Sometimes you can save big time by simply getting your suppliers to pay. Companies like Microsoft set aside millions of dollars each year to supplement new technology assessments and investments. All you have to do is ask.

Implementation

Oftentimes, the high cost of implementing IT solutions can be borne by outsourcing or staff augmentation.

Can’t handle incremental project workload with existing staff? New technology requiring specific expertise, and spikes in workload as a result of short-term projects, can be handled less expensively — and, in many cases, more efficiently — by temporary personnel.

You don’t need to outsource the entire project, but management may be the most logical place to start. A project manager can attend and lead facilities and departmental meetings, coordinate and manage critical milestones, and, most importantly, train your staff to take over the role once he or she is gone.

By focusing internal resources on core business functions, training time is reduced without adding permanent overhead.

 

Monetization

Everyone want to make money off of their investments, yet IT departments often find this difficult to accomplish.

Do you have an internal engineering-services department that handles maintenance and repairs to critical technologies? Does your data center have excess capacity?  These are just two areas where organizations can find monetization opportunities, but unfortunately, they are two areas that often fail miserably.

Before launching any effort to monetize internal resources, be sure that senior management establishes priority protocols that allow those resources to respond to external client needs with the same level of urgency as internal requests. This will ensure the success of most monetization efforts and a way to fund other IT initiatives without breaking the budget.

The budget process has become a necessary evil in today’s competitive business  climate. Creative planning approaches can turn it from an obstacle into an opportunity.


Greg Pellerin is a 15-year veteran of the telecommunications and IT industries and a co-founder of VertitechIT, one of the fastest-growing business and healthcare IT networking and consulting firms in the country; (413) 268-1605; [email protected].

Opinion

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Opinion
Don’t Underestimate Driving Spirit

By JERRY CIANCIOLO

You may have heard that Millennials aren’t starting businesses at the rate of previous generations.

According to the Kauffman Foundation, a nonprofit devoted to studying entrepreneurship, startup rates among Americans age 20 to 34 peaked at 35% in 1996 and has since declined to 23%.

Why?

Forget the pundits and their talk of the Great Recession’s effect, monopolistic corporations, student debt, and slowing population growth. It’s much simpler than that.

Raised by helicopter parents, Millennials just can’t shake the habit of listening to advice. And as an entrepreneur myself, I know how critical it is to ignore so-called experts.

Within two weeks of hanging our shingle, my partner and I submitted to a class project for a local college. A business professor and eight students visited to grill us for 90 minutes. A month later, the retinue returned.

“Let me be candid,” said the professor. “Your business has little chance of succeeding.” Kathy and I flinched.

“We’ve run the numbers, researched the market, factored in your resources and level of experience, and, well . . . ” He looked down and shook his head, delivering the coup de grace non-verbally.

His advice, in so many words? “Update your résumés — today, if possible.”

Almost three decades later, I look back on that afternoon and marvel that my now-wife and I succeeded. The odds were certainly stacked against us.

On our side of the ledger were resolve, resiliency, and a longing for independence. On reality’s side were revenue projections, capital outlays, return on investment, and market share. We were anorexics on the mat with a Japanese sumo.

Yet our business thrives to this day. By any measure, we won the match. But how? If the professor and his students returned and asked how we proved them wrong, what would we say? Simply this — the weaknesses you identified proved to be our camouflaged strengths. For example:

• We were blind to the odds. I remember leasing a postage meter in our first month. The company rep recommended a three-year contract. I suggested five, hoping to shave the fee. She demurred: “businesses like yours, well, let’s stay with three.”
• We didn’t know much about business. I didn’t have financial expertise, nor did Kathy. You wouldn’t find even one economics course on our transcripts. But we possessed what Mark Twain described as the two things you need in life to succeed: ignorance and confidence. The former we had in spades. As for our lack of business savvy, we wore it like a chip on our shoulders.
• We had little patience with systems. At a meeting with a volunteer from SCORE — a group providing free business counseling — I did my best to suppress a yawn as the retired exec plotted a series of steps we needed to take before opening the doors. He also wanted to know whether we had a mission statement. I kept tapping my foot; Kathy withheld her sighs. Paperwork was make-believe to us. It wasn’t going to determine whether we succeeded. Our wits would have to do that.
• We weren’t strategic. Our business goal was basic — survival. Improvise or die was our clarion call. We couldn’t afford to procrastinate, so we ran with whatever seemed sensible at the moment. No one at Wharton would call our carpe diem approach strategic.
• We didn’t delegate. In the early days, there was no alternative. If the computer froze, one of us dug out the manual to thaw it. If a mailing had to go out, we were the clerical staff. But even as profits grew, and hiring was an option, we continued our labor-intensive ways. Granted, we didn’t always put our skills to the best use, but running lean kept margins high and overhead low.

Of course, my wife and I have grown wiser over the years. We wouldn’t advise would-be entrepreneurs to follow our model. But, then, we wouldn’t advise them to follow any model except one that feels right.

That’s why we politely listened to the professor and then went about our business. We encourage Millennials to do the same.

The professor understood business. But entrepreneurs and their driving spirit? Not so much.


Jerry Cianciolo is chief editor at Emerson & Church, Publishers, the company he and his wife, Kathleen Brennan, founded in 1986.

Opinion

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Opinion
UMass Needs Continued Support

By ROBERT CARET

Over the past two years, Massa-chusetts has been a national leader in providing support for its public research university — boosting funding for the five-campus UMass system by an eye-catching $100 million.

And the state’s financial investment translated into something truly remarkable: the average net cost of attending UMass declined for the first time in recent memory, decreasing by more than $200 per student for the academic year just completed. Our leaders on Beacon Hill should take a bow — and I know that students and their families breathed sighs of relief.

Looking ahead, the state budget for 2015-16 has not been finalized, so we don’t know how much money UMass will receive, but it will be between the House’s $519 million and the Senate’s $537 million. Either would represent an increase over the current $511 million, but neither is enough to spare UMass its first fee increase in three years, so an increase of some magnitude seems inevitable.

Although Massachusetts has been at the head of the funding class over the past two years, we had a lot of catching up to do, since funding for UMass had been flat for more than a decade leading up to this period.

My hope is that the Commonwealth, dealing with budget problems of its own, regards this as a one-year retreat from a long-term major fiscal commitment to UMass and will not slip back into an era of relative inattention. Over the years, UMass has demonstrated that it is very good at doing more with less, but ‘more with less’ is not a good long-term strategy for a state that builds its economy on a foundation of brainpower.

I leave my post as president of UMass at the end of this month to become chancellor of the University System of Maryland. I will oversee a public university system where the flagship campus at College Park this past year received a state subsidy of $15,860 per student. Looking further south, the subsidy at the University of North Carolina Chapel Hill was $16,595 per student.

But here in Massachusetts, even after our $100 million increase, state funding per student for our flagship campus in Amherst during the past year was $9,025 — dramatically less than the level we see in North Carolina and Maryland, two states that compete head to head with Massachusetts in the global innovation economy. This is not a good position for Massachusetts, which will be going into battle against states that are spending dramatically more to arm their flagships.

Having seen the University of Massachusetts take major steps forward over the past four years, I fervently hope that UMass will receive the support it deserves and needs in the years to come — as an investment in UMass truly is an investment in the Commonwealth and its future.

Robert L. Caret is president of the UMass system.

Opinion

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Opinion
Bold Steps Needed to Curb Opioid Abuse


By DENNIS M. DIMITRI, M.D.

An epidemic of opioid use and the associated overdose deaths has been slowly building across the nation and Massachusetts for the last decade, and has now reached a crisis point. It is affecting nearly every city and town in the Commonwealth. In some communities, the crisis is unprecedented.

State officials estimate that more than 1,000 Massachusetts residents died of opioid overdoses last year — 33% percent more than in 2012, and nearly three times more than in 2000. A Harvard School of Public Health survey found that nearly four in 10 state residents personally know someone who has abused prescription pain medications.

While the total numbers may be startling, we should also remember that each individual overdose death has a human face. Each tragedy has changed a family forever. It has to stop, and the time for action is now. Physicians must step forward immediately to do everything we can to help bring this devastating problem under control. How can we do this? It starts with education.

According to the Centers for Disease Control and Prevention, more than 80% of people who misuse prescription pain medications are using drugs prescribed to someone else. These drugs are most often obtained from a friend or relative — for free, purchased, or stolen. This tells me that there are too many doses of opioid medications in circulation. By limiting this supply and ensuring that opioids are available only to patients who truly need them, we can make a big impact on the Commonwealth’s opioid crisis.

That is why the Mass. Medical Society is launching a comprehensive campaign to educate prescribers and the public about the safe and responsible prescribing and handling of these medications. The campaign has three components: guidelines to help physicians make the right decisions for their patients, free education resources for prescribers to help inform their judgments, and storage and disposal information for patients and their families.

• Prescribing guidelines. The guidelines not designed to micromanage care, but to provide guidance and information based on evidence that will improve the care of patients and lessen the risks associated with opioid prescribing. At the same time, we recognize that each patient is different, and, in all cases, a prescriber’s sound clinical judgment is important. However, we also believe that several principles should govern the exercise of this clinical judgment.

First, physicians and patients should discuss family and personal histories of substance-abuse disorders and behavioral-health concerns, before any prescription is written. Second, patients and physicians are encouraged to mutually develop agreements that outline the expectations and goals of the treatment, along with the conditions for continuing opioid therapy for chronic pain after initial treatment. Finally, there are exceptions for hospitalized patients, those in hospice and palliative care, and for those being treated for cancer. These patients have special circumstances that do not yield readily to hard and fast rules. Their care must be based upon long-held medical principles of relief of suffering.

We’re offering these guidelines with the hope that they will be adopted by physician practices throughout the state. We are also sharing them with the state Board of Registration in Medicine, in the event that the board will consider incorporating them into its prescribing guidelines for physicians.

• Prescriber education. The Mass. Medical Society has long been a leader in providing continuing medical education to physicians and other clinicians about pain management. We will now make these pain-management courses available to all prescribers, for free, until further notice. This includes not only our current suite of courses, but those currently in the pipeline that are due to be released in the coming weeks and months.

• Public education. An effective first step to reduce non-medical opioid use is through education. Therefore, in an effort to curb the supply of prescription opioids in the community, we are partnering with the Partnership for Drug Free Kids and its Medicine Abuse Project to broadly disseminate information about the safe storage and proper disposal of opioid medications.

Most people are probably unaware that their medicine cabinets are attractive targets for those who would misuse opioids, and that they could be an unwitting supplier. Our education program will provide guidance on how to safely store and secure medications, and how to get rid of them when they are no longer needed.

There is no more important public health issue today than the opioid epidemic. It is devastating communities, families, men, women, rich, poor, and, most tragically, children and adolescents. It has to stop — and we are ready to do our part.

Dr. Dennis M. Dimitri is president of the Mass. Medical Society.

Degrees of Improvement

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Law June 1, 2015
Law Sections
Job Prospects Are Getting (Slightly) Better for Law-school Grads

Karen Adamski, a 2014 graduate of WNEU School of Law

Karen Adamski, a 2014 graduate of WNEU School of Law, in her office in downtown Easthampton.

Eric Gouvin was asked to qualify the state of the job market for recent law-school graduates, and especially those at Western New England University School of Law, which he serves as dean.

He thought about it for a moment, and then, when asked to find a word or two or three to sum things up, he paused again before saying, “well … it’s not terrible.”

He would go on to elaborate, using more numbers than words, to convey the general opinion that what seems like a simple question doesn’t have a simple answer. That’s because these are intriguing and certainly challenging times for those looking to enter the legal profession, and the scene is changing, in some ways quickly and profoundly, and in others slowly and — at least for some of those looking to land work — frustratingly.

What’s changing, said Gouvin, is the landscape in terms of the number and types of services for which lawyers are required. In short, there are fewer of them, with more matters handled by paralegals and those without a law degree.

What’s not changing, meanwhile, are both the overall appetite for bringing on new lawyers (many firms are still hesitant to do so even through the economy is certainly better than it was a few years ago) and the rate of retirement for the Baby Boomers who came into the profession when it was, well, booming 40-plus years ago.

In short, those legions of attorneys who entered the profession in the early and mid-’70s aren’t retiring — or at least at anything approaching the rates one might expect. There are many reasons for this, said Gouvin, including the Great Recession and its impact on everything from real-estate values to retirement savings, and the fact that many lawyers are more inclined to stay active and scale back their workload rather than fully retire.

Add all this up, and it translates into “not terrible,” which is, by and large, a slight enhancement over a few years ago, a vast improvement over 2010 and 2011 (the two worst years for finding work in this profession in quite some time), and roughly the same as last year.

“I’m cautiously optimistic that things are getting better,” said Gouvin. “But it will be pretty much like last year; as the economy improves, the prospects for law hiring improve.”

Gouvin and other law-school administrators won’t really know how the class of 2015 fares for several months — 10 months out from commencement is actually the benchmark used by those tracking placement and related issues — because many job offers are predicated on one’s passing the bar exam, and that grueling exercise won’t happen until July, and the results won’t be known until fall.

But Jeffrey Stitt Jr. won’t have to wait that long. He’s one of the members of this year’s class at WNEU who already has a job — in this case, with the firm of O’Connell & Aronowitz, which is based in Albany, N.Y. and also has offices in Saratoga and Plattsburg, N.Y., his hometown.

“It was always a hope of mine to begin my legal career here,” he said from home just two days after commencement ceremonies on the WNEU campus. “So I was very fortunate to have something work out.”

Jeffrey Stitt

Jeffrey Stitt, seen just after WNEU Law’s commencement exercise on May 17, is one of the fortunate graduates who already have a job with a firm.

Meanwhile, Karen Adamski, a member of WNEU’s class of 2014, is settling in nicely at her solo practice in downtown Easthampton. The name over the door, also printed in smaller type on her business card, is O’Brien & Adamski Law Office, a name she kept (she believes it’s a sound business decision, not a sentimental one) to recognize her father, Karl Adamski, and Edward O’Brien, who practiced together for many years.

Karen told BusinessWest she entered law school with the intention of joining her father (O’Brien passed away several years ago), and that plan was jelling nicely until the elder Adamski became ill not long after she passed the bar and died a few months later.

She carries on by herself, handling everything from real-estate closings to estate-planning work, and said business is solid.

“Things have gone very well, surprisingly well,” she said, giving much of the credit for that to what she called a “support system” of other lawyers in that area who have provided help and mentoring.

As the examples of Stitt and Adamski clearly show, there are still ample opportunities to join this profession and have a law degree fulfill a long-held dream. Still, circumstances are making it more difficult to script such an outcome, and for some, the dream is being delayed or altered due to the challenging conditions.

Firm Resolve

After graduating from Westfield State University in 1989, Adamski eventually went to work for Hasbro, in R&D, where, among other things, she helped write content and rules for a number of games and supervised those who contrived the questions for Trivial Pursuit.

This was fun work and rewarding in several ways, but by 2010, she had made up her mind to plot a significant course change career-wise, join the legal profession, and essentially fulfill a childhood ambition that had been put on ice for more than two decades.

“Growing up and being around my father, I always had an interest in the law,” she explained. “But life got in the way, and it kept getting pushed off. At the time, Hasbro was changing its structure, and I was reassessing what I wanted to do with the next phase of my life. I decided that, if I was ever going to this, this was the time to do it.”

The timing of her decision is significant because 2010 was when the bottom started falling out in terms of both the legal job market and the numbers of individuals who were opting to pursue a law degree.

Gouvin noted that, for the fall semester in 2010, Adamski was one of 52,488 first-year law students enrolled in schools across the country. By the fall of 2014, that number had declined to 37,924, a startling 28% contraction, as schools reacted to a sharp decline in applications by shrinking the size of the classes.

Meanwhile, the worsening conditions also made it more challenging for graduates to find jobs — or at least the kind of jobs they were hoping for when they entered law school, usually taking on large amounts of debt to do so.

“Between 2008 and 2011, big law firms were just shedding jobs left and right — I think the number was something like 60,000 law jobs were eliminated during that period,” Gouvin noted. “There were a lot of layoffs, and the market took a huge hit; that big class that enrolled in the fall of 2010 graduated into a market that was pretty moribund in terms of hiring.”

Adamski was well aware of these developments as she filled out the paperwork to pursue her juris doctor at WNEU on a part-time basis. But she decided this was a risk worth taking.

“I knew it was a difficult time,” she recalled. “Firms were cutting back, certainly, but those times also put a strain on the solo practitioner, which is what my father was. It’s a lot of work to keep an office up and running in a market that had an excess of attorneys in it and not as many jobs available; everyone’s in competition.

“The tough conditions were something I was aware of,” she went on, “but the desire to do it was enough for me to decide that I would take a chance, hope that the market would square up a little bit, and make a go of it.”

She was fairly confident that she would find a suitable opportunity working beside her father and eventually succeeding him. The second part of that equation happened much sooner than she expected, and she regrets that, but overall, she’s happy with her career change.

However, the sharp downward spiral in the legal job market has deterred many over the past several years, said Gouvin, noting that enrollment at WNEU, as at most other law schools across the country, is down significantly from the years just prior to the economic collapse of 2008, and there is no indication that they will start to swing back up any time soon.


Offering Testimony

That’s because of all those market forces he described earlier, a combination of change and stagnancy that has many thinking at least twice about pursuing a law career.

Stitt, however, was not in that category.

Like Adamski, he said he was well aware of how the landscape had changed in the legal profession during and after the Great Recession when he was mulling whether to go to law school and where.

But he was also not deterred by what he had heard and seen.

“I’ve always wanted to be a lawyer, and I wasn’t going to let the job market deter me,” he told BusinessWest. “Everything is pretty cyclical, and I think the job market is going to come back around over the next few years.”

Perhaps, but some things will have to go right for conditions to improve substantially, said Gouvin. One of them is the economy, which certainly appears to be heading in the right direction.

Eric Gouvin

Eric Gouvin expects the job market for law grads to improve as the economy strengthens and Baby Boom-generation lawyers eventually retire.

Another is the eventual exodus of the Baby Boom lawyers and even some who came before them. While their departure from the stage will certainly generate a loss of valuable talent and expertise — as the expected mass retirements over the next decade will in all sectors of the economy — it will generate opportunities for a new generation of law graduates.

“One of the things we keep waiting for is the retirement of Baby Boom lawyers — but they keep holding on,” Gouvin noted with a telling laugh, adding that this is a rather large constituency.

Indeed, in 1969, the total number of JDs graduating was 15,000, he said, citing statistics he’s repeated many times. In 1975, that number was 32,000, swollen by a large number of law schools that had recently attained accreditation, including WNEU, then known as Western New England College.

Meanwhile, the basic laws of supply and demand will generate improvement as well, said Gouvin.

“The good news moving forward is that, for the group that just entered in the fall, their job prospects should be good, assuming the economy continues to recover,” he explained. “The delta between the number of available jobs and the number of new lawyers seeking those jobs will be smaller, simply because there will be a lot fewer lawyers graduated.”

Stitt acknowledged that he is more fortunate than many of his classmates — not only finding a job but one in his hometown — but noted that there are certainly opportunities to be found for those who are diligent and make full use of the resources that WNEU makes available to its law-school students.

“Like anything, there has to be a lot of initiative on your part,” he explained. “And they [WNEU administrators] give us the tools, and they also bring a lot of law firms from the Hartford-Springfield area onto the campus as well.

“Going back to when I was a 1L [the first year of law school] … they always preach to use the school’s externship programs and clinic programs to really shorten that learning curve when you get out of school and into practice,” he went on, adding that these programs can also help make a candidate more attractive to potential employers.

Summary Judgment

As for Adamski, she said keeping the name O’Brien & Adamski Law Office has been one of many factors that have contributed to what she considers a solid start to her career in the law.

“I kept that name because it has equity — it’s been around since 1972,” she explained, adding that many of her father’s clients have stayed with the firm, and she has brought in a number of new ones, including friends, colleagues from previous jobs, and people she knew through law school.

Hers was a plan that didn’t go entirely according to script, but in many ways has unfolded as she envisioned — just on a different timetable.

Many recent and current law-school graduates may well wind up using similar language but in different contexts as they strive to put their degrees to work.

Such is life in this changing environment, one where ‘not terrible’ actually constitutes improvement.

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

Opinion

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Sections
Embracing the New Science of Medicine

By JACK COCHRAN and CHARLES KENNEY

Is healthcare in the United States entering a big-chill era?

Is it losing its warmth and humanity? Patients and physicians worry that computer screens wall them off from one another, thus transforming the flesh-and-blood patient into a digital construct as data override empathy.

While this point of view is not entirely unfounded, we believe it is a potential obstacle to medical progress in the digital age. Our country is in the midst of an awkward transition from the industrial age of healthcare to the math-based information age. While the transition will continue to be disruptive, the end result is greater access, quality, equity, and, perhaps most urgently, affordability.

The current transition period will also lead to another breakthrough era when data, technology, and artificial intelligence — thanks to the growing importance of mathematics as a foundational element in the healing arts — will advance patient care to a new level.

It is clear — though perhaps counterintuitive — that data and technology are leading to more personalized care than ever, liberating physicians from non-doctor work while enabling them to focus on more complex patients. Surgeon and author Atul Gawande observed some years ago that technology, “oddly enough, may be holistic medicine’s best friend’’ as it frees physicians “to embrace the humanistic dimension of care.’’

The data/technology combination covers both ends of the spectrum: enabling more comprehensive care for large populations of patients with chronic conditions while simultaneously facilitating more personalized care to individual patients’ unique needs.

Managing populations of patients with a particular condition such as diabetes can improve quality and length of life. Population management is limited by its broad brushstroke application of similar approaches to all patients. Data now enable physicians to target the individual needs of each patient within a population.

A burgeoning number of technology companies — ranging from tiny startups in Silicon Valley to IBM and GE — promise to turbocharge this work. Omada Health in San Francisco exemplifies many technology companies that are helping clinicians manage chronic conditions among large populations of patients. Ingestible sensors from Proteus Digital Health in the U.S. and Britain allow uninterrupted monitoring of patients’ medication levels 24/7.

Watson, the IBM supercomputer, has been developed as a cognitive system with advanced textual, image-processing, and visual-reasoning abilities that is able to gather information from across an enterprise and identify important elements in the data to help clinicians make decisions more quickly and effectively. In less than three seconds, Watson sifts through 200 million pages of research and provides a response at the point of care. Watson processed nearly 700 pages of medical records and images for a cancer patient at Memorial Sloane Kettering and, within seconds, recommended a drug treatment drawn from a two-week old article in an Israeli medical journal — an article the physicians might never have heard about.

When we look broadly at the imprint of this mathematical age of medicine, we are exhilarated by the power of data leveraged by aggregation and analysis. We see routine use of big data for risk stratification, decision support, and shared decision making. We see mathematical modeling augmented by genomic information.

The current transition period is difficult, but the medical community will maneuver through its challenges — sometimes awkwardly — to a new era when data and technology will support better population and individual care than ever before.

Dr. Jack Cochran is executive director of the Permanente Federation. Charles Kenney is author of several books on healthcare innovation. Dr. Paul Grundy, global director of healthcare transformation at IBM, and Dr. John Merenich, medical director of clinical informatics at Kaiser Permanente Colorado, also contributed to this article.

The Here and Now

By
Employment Sections
Do Employers Have to Tolerate Attendance Problems Under the ADA?

By ERICA E. FLORES, Esq.

Erica Flores

Erica Flores

Today, just about any physical, mental, or emotional ailment will likely qualify as a ‘disability’ under the Americans with Disabilities Act (ADA), giving rise to a growing number of requests by employees for workplace accommodations. And, increasingly, such accommodations implicate what is perhaps the single most fundamental requirement of any job — attendance.

So how can Western Mass. employers best position themselves for potential ADA litigation when considering an employee’s request for an attendance-related accommodation? A recent decision out of the U.S. Court of Appeals for the Sixth Circuit offers some helpful guidance.

Jane Harris worked for Ford Motor Co. as a resale buyer of raw steel for auto parts. At first, her performance was strong, but it quickly began to decline, and by her final year at Ford, she ranked in the bottom 10% of her peers. Harris’s poor performance was due largely to her poor attendance, which was related to her disability — irritable bowel syndrome.

Harris disclosed her condition to her supervisor, and Ford approved a series of accommodations. First, Ford granted Harris a flexible schedule, allowing her to work four 10-hour days per week and telecommute as needed. Despite this flexibility, Harris’s attendance was irregular and unreliable, and she failed to perform the core objectives of the job.

Ford next provided Harris with workplace reporting guidelines and then allowed her to telecommute both during and after core business hours. Harris’s attendance problems continued, however, and she finally requested permission to work from home permanently up to four days per week.

In response to the request, Harris’s supervisor and two HR representatives met with her to discuss the essential functions of her position. They identified 10 different essential responsibilities and discussed her ability to accomplish each of those duties from home. Harris admitted that she could not complete four of her duties from home at all — including attending meetings with suppliers, attending internal meetings, and creating price quotes — and Ford concluded that Harris also could not effectively perform four of her other duties from home.

Accordingly, Ford denied her telecommuting request as unreasonable, but proposed two alternative accommodations — moving Harris’s workspace closer to the restroom or transferring her to a position better suited for a flexible telecommuting arrangement. Harris declined these offers and instead filed a charge of discrimination with the Equal Employment Opportunity Commission, which took up her case and filed a lawsuit against Ford on her behalf.

Ford won the case both in the district court and on appeal before the U.S. Court of Appeals for the Sixth Circuit. The court agreed with Ford that a trial was not necessary, finding that regular and predictable on-site attendance was an essential function of Harris’s job, and the accommodation she requested was unreasonable because it would have eliminated that essential function.

Although Harris disagreed that her physical presence at work was necessary, the court noted that an employee’s definition of the essential functions of her position is not valid when it is based solely on her personal viewpoint and experience. Although Ford allowed other resale buyers to telecommute, those employees telecommuted no more than one set day per week.

And, finally, there was no evidence that improved technology eliminated the need for Harris to participate in face-to-face interactions. In short, regular, on-site attendance was an essential function of Harris’s job because it was “job-related, uniformly enforced, and consistent with business necessity”; there was no accommodation available that would have allowed her to perform that essential function; and Ford had acted in good faith by maintaining an interactive dialogue with Harris and trying to accommodate her illness.

The Sixth Circuit’s opinion provides useful guidance for employers who may face requests for attendance-related accommodations.

Most importantly, employers must be able to clearly articulate the essential functions of each and every job in their workforce, including the attendance requirements. Those essential functions should be documented in written job descriptions that are provided to new employees at the time of hire and updated as job duties change.

Additionally, employers who make flexible schedules, telecommuting, or other alternative attendance arrangements available (upon request or through a policy, for example) should consider developing specific eligibility or other criteria designed to ensure that such arrangements do not impede the effective performance of the other essential functions of each position.

If employers do this homework ahead of time, they will be in a good position to handle a request for an attendance-related accommodation and will be able to better assess whether that requested accommodation is reasonable, whether it would instead eliminate an essential attendance requirement, and whether any other reasonable accommodations might be available.

Erica E. Flores is an attorney at Skoler, Abbott & Presser, P.C ., which exclusively represents management in labor and employment matters. She has successfully defended employers before state and federal courts and administrative agencies. In addition to her litigation practice, she regularly advises clients with respect to day-to-day employment issues, including decisions regarding adverse employment actions and litigation avoidance. This article is not intended as legal advice related to individual situations. If your business is facing a specific legal problem, consult your labor and employment counsel for legal advice and planning; (413) 737-4753; [email protected]

Poll: Warren’s Constituents Cool to Presidential Run

By
Daily News

SPRINGFIELD — While progressive political organizations dream of convincing Senator Elizabeth Warren to run for president in 2016, a majority of Warren’s constituents think a presidential candidacy is a bad idea, according to the latest survey from the Western New England University Polling Institute. The telephone survey of 427 registered voters in Massachusetts, conducted April 6 – 14, found that 57% said that Warren seeking the presidency would be a bad idea, 32 percent said it would be a good idea, and 11% said they did not know or declined to answer the question. The survey has a margin of sampling error of plus or minus five percentage points. Warren has repeatedly said she has no plans to run for president in 2016, despite ongoing efforts by liberal political organizations to entice her to run. While a majority of voters in Massachusetts don’t think Warren should run for president, those sentiments do not necessarily reflect negative views of Warren. The survey found that 62% of voters approve of the job Warren is doing as senator, 21% disapprove, and 17% said they did not know or declined to answer the question. More thasn half (55%) of voters have a favorable view of Warren, and 30 percent of voters have an unfavorable view. The survey also found that:

• Governor Charlie Baker, after having served 100 days in office, has a job approval rating of 63%, with 10% of voters disapproving, and 27% saying they did not know or declining to answer the question; 56% of voters have a favorable view of Baker, while 13% hold an unfavorable view, marking an increase in Baker’s popularity since winning election as governor in November.

• Senator Ed Markey, who won re-election in November, has a job approval rating of 35%, with 18% of voters disapproving and nearly half of voters — 47% — either unable or unwilling to offer an opinion. Markey’s favorability rating is 35%, with 19% unfavorable, 15% saying they have not heard of him, and 27% saying they have no opinion of him. Markey’s unfavorability has dropped 10 points since October, while his favorability has remained steady.

After asking voters about a hypothetical Warren candidacy for president, the Polling Institute asked voters to explain, in their own words, why they think Warren running for president would be a good idea or a bad idea. Among voters who said a Warren White House bid would be a bad idea, the most frequent reason given was that Warren does not have enough experience yet to serve as president (38%). Meanwhile, 12% said Warren is too liberal, while another 12% said they don’t like Warren, or they don’t like her issue positions. Tim Vercellotti, director of the Polling Institute and a professor of political science at Western New England University, said that voters who think a Warren presidential candidacy is a bad idea are a mix of her detractors and supporters. “While there are plenty of voters who oppose the idea because they feel Warren is inexperienced or they don’t like her or her issue positions, there is also a significant number of voters who say she is doing a good job in the Senate and they want her to stay there,” he said. Democrats were almost evenly divided, with 42% saying a presidential run would be a good idea and 46% saying it would be a bad idea. Among Republican and unenrolled voters, more than 60% said they thought it would be a bad idea.

Opinion

By
Opinion
Olympics Numbers Just Don’t Add Up

By Andrew Zimbalist

The UMass Donahue Institute’s recent report on the economic impact of a 2024 Summer Olympics in Boston wasn’t surprising, given its assumptions and methodology — it projected gains of more than 50,000 jobs and billions of dollars.

While parts of the report are well-reasoned, the predicted impacts are suspect. That’s because the institute accepted the unrealistic assertions of the Boston 2024 organization regarding costs, revenues, and financing; used an inappropriate input-output methodology; ignored scholarly literature on the economic impact of hosting mega-sporting events; and misapprehended some items contained in the Boston bid.

In essence, the report’s results flow out of the assumptions that all operating costs will be covered by revenue from the Games, all construction costs will be covered privately, and the federal government will pick up 100% of the security costs (optimistically forecast at only $1 billion).

Consider each of these elements. The Boston 2024 bid shows operating costs and revenues at $4.7 billion. To get to this figure, Boston 2024 invokes $1 billion in “additional” or “other” revenue, the sources of which are not revealed. Boston 2024 also assumes it will take in $1.15 billion in ticket sales. London had an 80,000-seat Olympic Stadium, replete with luxury boxes and other revenue-generating accoutrements. Boston 2024 is planning a temporary, spartan, 60,000 seat stadium. London generated only $990 million in ticket sales. How will Boston top that by more than 16%?

Boston 2024’s operating costs include a $600 million payment to the U.S. Olympic Committee in recognition that some of the domestic sponsorship money will come from corporate relationships built by the USOC. Illogically, the new report figures $220 million of this money will go toward creating business and employment in Boston. This number is then multiplied by roughly 1.9 (the new employment generates new income, which brings new consumption, etc.), according to the IMPLAN model used in the report.

But this model is inappropriate for estimating the economic impact of mega-events. The sheer volume of construction around mega-events leads to the use of companies and workers from outside the hosting region, leading to much larger leakages out of the local economy and unrealistically high multipliers, among other problems.

It is noteworthy that most macro-economic models of the entire U.S. economy have multipliers of around 1.2. Since the Boston economy is only a small fraction of the U.S. economy, it is not feasible that it would have a multiplier that is more than 50% larger. Yet, that is what the report’s results depend on.

Although the institute expresses some skepticism, its report incorporates Boston 2024’s claim that all the venues will be built with private money. Why would a U.S. company build an Olympic stadium that will be torn down? Or a velodrome? Or a pentathlon stadium? Why has no company stepped forward and declared its intention to even explore this opportunity?

Based on its IMPLAN model, the report estimates that hosting the Olympics will generate more than 50,000 new jobs in 2024. It says these workers will spend some of the money they earn here, further boosting the local economy. But that makes no allowance for the fact that Olympic Games are notorious for relying on voluntary labor.

The Donahue report also examines the uncertainty of the impact of hosting on tourism, both during the games and after. It mentions that London tourism during the summer of 2012 was down by 8% compared with 2011. The report might have added that 2012 was one year further removed from the financial crisis of 2008-09, and, other things equal, we would expect higher tourism figures in 2012. The report neglects to mention that tourist arrivals in Beijing in 2008 were down 20%. Despite this evidence, and that from scholarly studies, the report curiously projects a substantial boost to Boston’s tourism.

If one builds an empirical model and simply assumes that all the investment will be private and that the investment won’t displace other investments, it is easy to show output and job growth. But these rosy projections are no more realistic than Boston 2024’s starry-eyed claim that no public money will be spent.

Andrew Zimbalist is a professor of economics at Smith College. His new book is “Circus Maximus: The Economic Gamble Behind Hosting the Olympics and World Cup.”

Opinion

By
Opinion
State Gets Serious About Opiate Abuse

By RICHARD PIETERS, M.D., BARBARA HERBERT, M.D., and DANIEL ALFORD, M.D.

Prescription drug abuse is now one of the toughest problems communities face, and officials at local, state, and federal levels are all wrestling with what to do about it. Multiple actions have been taken, including new laws and regulations, monitoring programs, and restrictions on prescribing, with varying results.

The Commonwealth’s new governor and attorney general, Charlie Baker and Maura Healey, have made opiate abuse one of their top priorities. That’s good news, because we are losing hundreds of lives to prescription and opiate abuse.

While drugs like heroin remain a prime cause of overdoses, 52% of the 44,000 drug-overdose deaths in 2013 were related to pharmaceuticals. And of those, 71% involved prescription pain medicines — mostly by people using drugs prescribed to someone else.

As the Institute of Medicine (IOM) has noted, pain is a significant public health problem. Some 100 million adults have chronic pain alone — more than those with diabetes, heart disease, and cancer combined. Whether chronic (constant and long-lasting), acute (of shorter duration), or cancer-related, pain is one of the most frequent reasons for physician visits and taking medication, which often helps with the acute pain of trauma, injury, or surgery.

Healthcare providers write a huge amount of prescriptions for pain medicines — 259 million in 2012 alone. Yet, with some 12 million Americans using prescription medications for non-medical reasons and with more than three out of four people who misuse prescription pain medicines using drugs prescribed to someone else, the reasons for abuse go beyond the number of prescriptions issued.

Physicians and patients together can work together to help reduce the abuse. Here’s how.

Physicians believe patients who experience pain should be able to get relief and understand that appropriately treating pain helps patients heal. Medications carry risk, however, and with opioids, one of the risks is addiction. Physicians must balance the risks and benefits of opioids — while exploring other kinds of treatment in open communication with patients.

Medicines like opioids, taken exactly as prescribed under a physician’s supervision, are excellent therapies for certain kinds of pain, but they may not be appropriate for all people.

Patients must clearly communicate expectations to their physicians. They understandably want immediate relief from pain, but taking more pills than the prescription calls for and dismissing the vital instruction of ‘take only as directed’ may risk harm and make the medicine less effective.

Insurers, who are reluctant to pay for other treatment options, such as physical therapy, acupuncture, and cognitive behavioral treatments, should begin to do so, giving physicians and patients other options besides pills.

Physicians must partner with their patients to figure out what the best treatment is, when opioids are best, and, when they’re not, what the best approach is for treatment. In many cases, the best approach may be one combining opioids with other medicines and additional methods like those named above.

Patients should be candid about their level of pain and tell their doctors what other medicines or substances (such as alcohol or marijuana) are being taken. Mixing substances is dangerous and can be lethal.

Above all, patients should be aware of the National Institute of Drug Abuse’s three elements of prescription abuse: (1) taking someone’s else’s medication; (2) taking medicine in a higher dosage or another manner than prescribed; and (3) taking medications for purposes other than prescribed. Patients have the power to act on all three.

Patients can stop the diversion of medications with responsible storage and disposal. Leaving prescriptions in medicine cabinets is a bad idea; it’s the primary way people who aren’t prescribed medicines get them. Medicines should be stored securely, preferably in lock boxes, and unused medicines should go to ‘take-back’ programs within communities.

Beyond prevention, adding more substance-abuse treatment programs to help with addiction and increasing the availability of naloxone, a prescription drug that prevents death from overdose, are steps that will save lives.


Dr. Richard Pieters is president of the Massachusetts Medical Society. Dr. Daniel Alford is director of the Clinical Addiction Research and Education Unit at Boston Medical Center. Dr. Barbara Herbert is medical director of Addiction Service at Commonwealth Care.

Opinion

By
Opinion
Adjust Health Law for Small Businesses

By Jon Hurst

Congressional Republicans and President Obama continue to wrangle over the future of the nation’s healthcare law. But they need to focus on fixing the law rather than repealing it or threatening vetoes on any form of improvement.

It is no surprise to us in Massachusetts that the shortcomings of the basic framework of the Affordable Care Act mean marketplace discrimination for small businesses and their employees. We saw that in our state model of the ACA. Powerful lobbying groups protected certain consumer groups from harm. Big businesses were protected and retained the ability to self-insure, while lower-income individuals qualified for taxpayer-funded premium assistance.

Left unprotected and arguably disadvantaged were those in the middle — owners and employees of small businesses. Several years of double-digit premium increases here resulted in changes to state law to help empower small businesses.

Washington should make changes to the ACA like those made in Massachusetts to make sure health-insurance reform works for everyone. Here are four recommendations:

• Allow existing organizations — associations, professional societies, and chambers of commerce — to form nonprofit, small-business cooperatives to enhance purchasing power, provide more choices, and better educate their members and employees on the importance of wellness programs and the use of provider-transparency tools. This is how small businesses want to buy their insurance. Consider that, since their start in 2012, the Massachusetts cooperatives have served more small businesses than the state’s Health Connector, and they haven’t cost the taxpayer one dime.

• Allow insurers to give discounts to small businesses as they get bigger. It is a fact that, for both actuarial and administrative reasons, the more people a business covers, the lower the cost per person. Yet the Affordable Care Act is phasing out this ability for any employer with fewer than 99 employees, since the law eliminated the size-rating factor from the small-group market.

Those businesses with 100 or more employees are not hurt by this policy, which in turn gives them a huge premium competitive advantage. The phaseout of the size-rating factor means artificially higher premiums for growing small businesses. The logical way to avoid unreasonable premiums is to leave the fully insured small-group market entirely and to self-insure. Already, 55% percent of the Massachusetts market is self-insured. This trend will grow rapidly unless this discriminatory ACA policy is fixed.

• Change the definition of full-time employee from 30 to 35 hours per week. Massachusetts used the 35-hour threshold without disruption, but the same can’t be said of the 30-hour ACA requirement. Most small employers consider employees working 35 hours or more to be full-timers, but few have the same view about 30 hours.

• Allow small businesses to avoid state mandates — just as big businesses do. Self-insured employers operate under federal law and can avoid state mandates. But small, fully insured employers have no escape. Twenty-four new mandates and/or assessments have been passed in Massachusetts since 2006, making the health-insurance marketplace increasingly discriminatory. The ACA needs to address the proliferation of state mandates.

Unfair provisions in the healthcare law are putting small businesses and their employees at a huge disadvantage.

The Affordable Care Act can work for everyone, but not under today’s model. Unfair provisions are putting small businesses and their employees at a huge disadvantage, endangering their futures. Washington needs to fix the problems.

Jon Hurst is president of the Retailers Assoc. of Massachusetts.

Cathedral High School, Holyoke Catholic High School to Merge

By
Daily News

SPRINGFIELD — Cathedral High School and Holyoke Catholic High School will be merged into a new, regional Catholic High School under a plan announced yesterday by Mitchell Rozanski, bishop of the Diocese of Springfield.

While the site of the merged school has not been determined, Springfield Mayor Domenic Sarno and other Cathedral supporters are still pushing for the school to be rebuilt on the tornado-damaged Surrey Road location where Cathedral had been located.

“No concepts other than a new regional school have been decided,” Rozanski said, noting that Surrey Road is one of several options that will be investigated. The bishop wants the two schools’ students to be merged in a temporary location by the fall of 2016, and for a permanent school to be completed by the fall of 2017, adding that insurance money from the tornado, plus $29 million in Federal Emergency Emergency Management Agency aid, will fund the construction.

“The city of Springfield has supported Cathedral at its temporary home in Wilbraham by providing over $1 million of support in busing as well as assisting with locations for athletic practices and events. We will continue to support Cathedral as long as rebuilding on Surrey Road remains the plan,” Sarno said. “I am hopeful that Bishop Rozanski and the diocese will live up to their commitment made by Bishop [Timothy] McDonnell to rebuild Cathedral, where it belongs, on Surrey Road. The extended Cathedral family and neighborhood deserve nothing less.”

U.S. Rep. Richard Neal agreed, noting in a statement that “my belief that Surrey Road is the best and only location for that facility has not changed. Simply put, when I sought federal assistance from FEMA following the tornado in June 2011, I did so with the understanding that Cathedral High School would be rebuilt on its original site in East Forest Park. That was the purpose of securing public disaster assistance.”

He continued, “it has been nearly four years since the tornado touched down on Surrey Road, and during that time the Cathedral family has been extraordinarily patient and supportive. We have given the diocese space and allowed them to do their due diligence. I don’t think it is unreasonable to suggest that we now deserve answers. The history of Springfield and Cathedral are intertwined, and it is hard to imagine one without the other. That is why I will continue to support the effort to rebuild the regional high school in East Forest Park. In my opinion, it remains the only logical site.”

Since the June 1, 2011, tornado severely damaged Cathedral, its 400 students were relocated to the former Memorial School in Wilbraham, where the diocese has been renting space; enrollment has since declined to just over 200. Meanwhile, Holyoke Catholic was forced to move from its namesake city in 2002 when its building was declared unsafe. After setting up at the former St. Hyacinth College and Seminary in Granby for four years, the school, which has about 250 students, moved into the former Assumption School on Springfield Street in Chicopee, opposite Elms College, in 2006.

Opinion

By
Opinion
Early Education Is a National Priority

By JOAN KAGAN

All of us in the broad field of early-childhood education and care were elated to hear our vital services underscored as a priority in President Obama’s State of the Union Address late last month.

As executive director of Square One, which has been providing these services since 1883, I believe the president’s remarks to a joint session of Congress shows us that our leaders are willing to spend political capital to acknowledge the value of investing in our young and vulnerable citizens.

The president stressed that child care is something that’s not merely good to have, but something that middle-class and low-income families must have. It is a message that Square One, together with our colleagues in the field, has been sharing for years, and we are ecstatic to know that the most powerful people in Washington have decided it is worthy of discussion on a national stage.

Universal child care is not a new idea. During World War II, the young men went off to war. Having women in the workforce was a national priority, and this country responded by providing universal child care. Today, in much the same way, enabling middle-class and low-income parents with young children to work and support their families has to become a national economic priority. Even as our economy continues to recover and grow stronger, families where both parents work are more prevalent than ever. And in the case of single-parent households, every parent in the family works.

A stronger economy has been good news for ‘Mary,’ who was overjoyed at finding her first professional job. Mary, who had been homeless and on welfare, first came to Square One as a participant in our Mom Squad program. This innovative model helps mothers who receive aid from the Department of Transitional Assistance engage in volunteer service at community agencies, including Square One. By performing a minimum of 30 hours per week of community service, participants can get voucher assistance to enroll their children in high-quality early-education and care programs.

While Mom Squad members work without pay to gain on-the-job training in a supportive, nurturing environment, their child is cared for at Square One. It is a great model. However, there is a problem that arises when someone like Mary ‘graduates’ from the Mom Squad and applies the skills she learned to get a real job earning a decent wage. She lifted herself and her family out of homelessness and dependency on welfare. So what is the problem? Now that she has a job, she is no longer eligible for a child-care subsidy, and she needs child care in order to work. Mary has confided in her Square One social worker that, if she cannot find a child-care solution, she may end up back on welfare.

Quality child care for five days a week often costs more than a month’s rent. Over a year, quality child care can cost as much as it costs to attend community college. A quality early-education and care experience for our children is costly when quality is (and should be) maintained. Research-based materials, professional development for teachers, a stimulating learning environment supplemented with developmentally appropriate supplies, and activities to support a child’s early learning do not come cheap.

It is a labor-intensive industry, despite the fact that child-care workers are among the lowest-paid professionals nationwide. The cost of care is particularly difficult for low-income working parents, like Mary.

Access to affordable, high-quality early education and care is a national priority if we want to help more middle-class and low-income families get ahead or avoid welfare assistance, and if we value giving every child an opportunity to enter kindergarten ready to learn. In the president’s words, child care is no longer nice to have; it’s a must-have.

Joan Kagan is executive director of Springfield-based Square One; (413) 732-5183.

Difference Makers 2015: Judy Matt, President of the Spirit of Springfield

By
Class of 2015 Difference Makers
City’s Biggest Cheerleader Has Generated Light During Some Dark Times

Photo by Denise Smith Photography

Photo by Denise Smith Photography

It was with a strong dose of pride in her voice that Judy Matt explained that she keeps everything, and never tosses anything.

To prove it, she had a staff member at the Spirit of Springfield (SOS) retrieve an old briefcase from storage in the agency’s office at 1350 Main St.

In it was an eclectic array of items from her years at the helm of something called the Mayor’s Office of Community Affairs, or MOCA, in the mid-’80s, and also from her prior work for the Greater Springfield Convention & Visitors Bureau (GSCVB). They included several program booklets from inaugural ceremonies involving a few mayors, but especially Richard Neal, who served from 1984 to 1989 and recruited Matt to lead MOCA; some marketing materials she created while at the GSCVB that featured the phrase ‘Metro Springfield,’ which she concocted; and a program book from the grand opening of the ‘old’ Basketball Hall of Fame in 1985.

And then, there was a promotional piece called “The Great Trees of Our City,” a pamphlet that highlighted a number of Springfield’s more noted examples of arboreal splendor, from a river birch on the grounds of MassMutual’s headquarters to the famous black walnut on State Street that now stands guard in front of the new federal courthouse.

“Richie Neal liked to build pride in the city — he did a lot of things like that,” Matt said of “The Great Trees.” “He was always looking for ways to showcase the city and make everyone proud.”

Suffice it to say that Matt’s efforts to promote Springfield, engender pride, and create positive vibes in a city that has sorely needed them, have come a long way from that brochure.

A very long way.

Indeed, over the past 30 years or so, first with MOCA and especially with the nonprofit Spirit of Springfield, formed after MOCA’s demise, Matt has spearheaded everything from the Big Balloon Parade down Main Street to what was, for some time, called the ‘World’s Largest Pancake Breakfast’; from First Night festivities to fireworks on the Fourth of July long after the city lacked the ability to pay for them.

And then, there’s the holiday lighting display Bright Nights, which recently celebrated its 20th year. The largest endeavor of its kind in the country, it has put Springfield on the map and found itself within a few lines of the majestic fountains of the Bellagio resort in Las Vegas on many national lists of must-see attractions.

Meanwhile, there have been other special occasions and events for which the city has turned to Matt to play the lead role in both making them happen and making them special. That list includes everything from city birthday celebrations to Larry Bird’s induction into the Basketball Hall of Fame, to the massive — and carefully orchestrated — funeral arrangements for slain Springfield police officer Kevin Ambrose in 2012.

Bright Nights

Bright Nights, which recently celebrated its 20th year, is now a permanent fixture on many national lists of must-see attractions.
Photo Courtesy Spirit of Springfield

But when you talk with those who have worked with Matt on these initiatives and others over the years, they inevitably talk as much about how she carries out her work as they do the volume of work. They use words like ‘energy,’ ‘enthusiasm,’ ‘determination,’ ‘imagination,’ and ‘passion’ (that’s the one you hear most often) to describe her approach to meeting her job description. They also speak to a unique talent for marshaling the forces needed to make all these events happen — from corporate sponsors for Bright Nights to the volunteers holding the ropes on the Cat in the Hat balloon — and an ability to somehow bring needed light during some of the city’s darkest times.

“Judy has been a true champion of Springfield, a real believer, especially during the tough times, when a lot of people were saying, ‘if you’re the last one to leave, turn out the lights,’” said Bill Pepin, president of WWLP Channel 22 and the first president of the Spirit of Springfield board. “She never gave up on Springfield, and has always been of the opinion that, when times are tough, that’s when you need the Spirit of Springfield most. And we’ve had a lot of tough times.”

Jane Albert, current chair, agreed, and noted that putting on a fireworks display or staging a parade may not be saving lives, combatting poverty, or eradicating homelessness, but Matt is improving quality of life, which certainly qualifies her as a Difference Maker.

“Judy makes a difference in the lives of so many people,” Albert told BusinesWest. “She’s passionate about what she does, and she cares deeply about the community. Most cities don’t have a Judy Matt, and Springfield’s very fortunate that it has her.”

Let There Be Light

During a lengthy interview with BusinessWest in the late summer of 1998, Matt told this writer that her job, “pure and simple, is to make the boss look good.”

She summoned those words while talking about a lifelong desire to toil in the background (although that’s impossible to do as director of the SOS) and direct praise to those for whom she worked for a particular event or initiative. And over the years, the word ‘boss’ came to mean many things. Early on, in the days of MOCA, and to a large extent today as well, it means the city’s mayor — even though the Spirit of Springfield is not a city department, a common misperception.

But it also means the members of her board, the corporations and individuals who have donated millions of dollars over the years to make events happen, and even the residents of Springfield and surrounding communities.

And this desire to please so many bosses is what drives Matt to not only produce events, but do them in a big (and, yes, expensive) manner where cutting corners is simply not an option, even if some of those bosses might have suggested (quietly and even loudly) that she might want to consider doing so.

And there’s no better example of all this than Bright Nights.

That story begins in the spring of 1995, when Pat Sullivan, director of Springfield’s Parks and Recreation Department, came into possession of a brochure from the Carpenter Decorating Co., a North Carolina-based business that designed and manufactured holiday lighting displays.

Intrigued by what he saw, Sullivan envisioned Forest Park, one of the largest municipal parks in the country at 735 acres, as a site for such a display. He brought the concept to Matt, who soon took Sullivan’s vision to a much higher level.

Indeed, while early discussions focused on using only the park’s baseball fields for off-the-shelf lighting displays such as Santa Claus throwing snowballs, Matt envisioned using the entire park and creating displays that paid tribute to the city’s history and noted residents such as Theodor Geisel (Dr. Seuss) and Everett Barney, who donated land for Forest Park and invented the first clamp-on ice skate.

Working with John Catenaci, design director for Carpenter Decorating, Matt and Sullivan started advancing a plan for a two-and-a-half-mile-long series of displays that would thread its way through the park. Making this vision reality required clearing a host of hurdles, from logistical matters including wiring the park and digging trenches for that wiring, to the matter of convincing a very skeptical board of directors to go along with the idea, to finding corporate sponsors for the ambitious lighting displays.

The Big Balloon Parade

The Big Balloon Parade has become a Springfield tradition, one of many launched, or continued, by the Spirit of Springfield and its president, Judy Matt.
Photo Courtesy Spirit of Springfield

“When we look back, we often laugh and say, ‘how did we ever get all of that done?’ But if you believe in something, you can accomplish it, and Judy believed in it,” said Sullivan, adding that, by Thanksgiving, a host of displays, from Seuss Land to North Pole Village to Toy Land, were ready for prime time. And Matt had added ‘Wonder Woman’ — a phrase summoned by a city official upon his first look at the completed Bright Nights — to a host of unofficial titles bestowed upon her over the years, including ‘Springfield’s biggest cheerleader,’ ‘Mrs. Springfield,’ and the ‘First Lady of Springfield.’

How she would come to eventually earn such names is an intriguing story. It begins when Matt, living then in Connecticut, followed her husband, somewhat reluctantly, to Western Mass. in 1970 as he took a job here.

As for her own employment situation … well, she actually put an ad in the local paper stating a desire to find a suitable opportunity, as well as her credentials. The former Chicopee Bank and Trust responded and eventually offered her a job heading up its first MasterCard program.

She moved from there to a job leasing space in the recently opened Baystate West (now Tower Square) and was soon promoted to the position of marketing director. Soon after Neal was elected mayor in November 1983, he asked Matt to coordinate his inauguration ceremonies. She remembers being taken aback by that request — “I didn’t really know him that well, and I said, ‘Richie, I don’t know anything about inaugurals’” — but took on the assignment. She impressed him enough that, when Rick Norcross left his position as head of MOCA, Neal recruited her to take the helm. Over the next several years, she handled everything from the city’s 350th birthday festivities in 1986 to the “Great Trees” brochure.

When funding for MOCA was attached to a proposition 2½ override bid that would fail, the office’s doors closed. It wasn’t long, however, before people like Pepin, Mercy Hospital President Sr. Mary Caritas, and Republican Editor Arnie Friedman, among others, concluded that its work must continue, and that the logical choice for an individual to lead such an organization was Matt, who eventually accepted the job.

But to say that the entity that would come to be known as the Spirit of Springfield had humble beginnings would be a huge understatement.

“Attorney Mike Wallace, who was one of the board members, gave me some space in his office at 95 State St.,” Matt recalled. “We had a desk and a phone, and I would spend almost a year just trying to re-establish us.”

In December of 1989, the agency became a nonprofit, 501(c)3 organization and received its first major gift, $20,000, from Tom Burke, president of Burke Beverage, to stage its first event, the Taste of Springfield.

“In was hard to raise money and for people to gain confidence in us in the early years,” Matt noted, adding that the agency managed to gain a firm foothold thanks to early corporate supporters such as Burke, Friendly Ice Cream, Milton Bradley (now Hasbro), and “some of the local banks that aren’t around anymore.”

The rest, as they say, is history in the making.

Some Bright Ideas

While, to many casual observers, the Spirit of Springfield’s work goes on easily and seemingly effortlessly, the reality is much different.

Indeed, funding the various events and initiatives is an ongoing battle, said Matt, adding that even Bright Nights, which many perceive to be a huge money maker, struggles in its mission to both pay for itself and fund other events such as the balloon parade. And a rough winter — like the one experienced in 2013-14, when five nights were lost due to snowstorms — can wreak havoc with the agency’s budget.

“Doing all that she does hasn’t been easy — it hasn’t been easy at all,” said Pepin. “Once in while I’ll run across someone who will say ‘Bright Nights … they’re making a lot of money off that.’ The reality is that they’re not — they’re surviving.

“It’s not like they’re rolling in dough — they’re not holding their board meetings in Tahiti,” he went on. “Funding all these events is a constant struggle.”

And fighting the budget battle is only one challenge that Matt must confront. There is the lingering perception that the agency, its many initiatives, and Matt’s salary are funded by the city, a factual error that can make it difficult to secure funding or support in the court of public opinion.

Meanwhile, Matt has often had to battle red tape and both bureaucratic and fiscal obstacles put in front of her by the communities she’s serving.

“She was doing things for the city when everyone else had essentially given up — she was trying to make things positive for the city,” said Pepin.

“And the city itself hasn’t really gone out of its way to make things easy for her or for organization,” he added. “Here’s an organization that’s trying to do positive things for the residents of Springfield and the surrounding areas, and over the years, they’ve thrown obstacles in her way. Instead of rolling out the red carpet and saying, ‘how can we help you?’ they’ve created issues and obstacles.”

The funeral for slain Springfield police officer Kevin Ambrose

The funeral for slain Springfield police officer Kevin Ambrose was one of many special events that Judy Matt has helped coordinate for Springfield leaders.

In the course of navigating all that, Matt has been driven, said those we spoke with, to create special and lasting memories for area residents, and make things brighter during dark and difficult times. And there have ben many such periods, ranging from city fiscal crises to the events of 9/11 to the tornado that roared through the region on June 1, 2001.

And, again, Bright Nights is a good example.

“Springfield was in a dark and low point at that time,” said Sullivan in reference to the mid-’90s, when the project was conceived and taken from the drawing board to reality. “There was a recession and things happening that you don’t want to happen.

“There wasn’t a good feeling in the city overall — the economy was distressed,” he went on. “And Bright Nights was a catalyst … it helped project that feeling you needed in the city, that Springfield was a place to come and visit, and we should be proud to live in the city. That’s what it meant to me.”

Albert remembers the days after the tornado struck, when there were discussions about whether the city should go forth with the fireworks at a time when so many had seen their lives uprooted. And she remembers Matt not only insisting they that go on, but that they be made special.

“She was so committed to making it incredible for the residents because it was such a low time for the city,” said Albert. “There have been many times when the city was challenged, but the tornado was a very difficult time for the community, and she just said, ‘we have to do this … we have to make this happen for the city, and we have to do a great job.’ And she did.”

Matt’s ability to get things done has prompted several mayors and other administrators to call on her to help with events that are not directly under the purview of the Spirit of Springfield, but nonetheless reflect on the city in many ways.

Albert cited the funeral arrangements for Ambrose as just one example of how Matt can move quickly and decisively and maximize the many strong relationships she’s built over the decades to the betterment of the city.

“There were 1,000 to 1,200 police officers in Court Square for that event,” Albert recalled of the Ambrose proceedings. “She had just a few days to pull that together; she just picked up the phone, called the presidents of large companies in this area, and said, ‘we need some funding to do this,’ ‘this is what we need to do,’ and ‘will you help?’

“I’m not sure if the city went to Judy or if this was Judy’s idea, because she’s always had that sensitivity,” she went on, “and has always wanted to help the city put its best foot forward.”

The Spirit Moved Her

For that interview with BusinessWest back in 1998, Matt summed up her office and her work this way:

“A city isn’t just buildings and streets and bridges. Those things don’t make a city, people do, and part of what makes a community livable is celebrations — they’re a part of us.”

Anyone who has driven through Bright Nights, taken in the fireworks on the Fourth of July, or watched the giant balloons make their way down Main Street would agree.

And for making all these happenings happen and putting smiles of the faces of millions of people, Matt is truly the First Lady of Springfield — and certainly a Difference Maker.

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

Opinion

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Opinion
Education Reform: More Work to Do

By PAUL REVILLE

When the education reform bill was enacted in the early 1990s, its main goal was to educate all students to high levels. And all meant all. Many reforms and investments were implemented, and the state is now the national leader in student achievement. Still, there are deep, persistent achievement gaps and inequality of opportunity that don’t meet our goal of “all means all.’’ Too many students leave school unprepared for college or a career. Until this is addressed, we cannot consider our prodigious reform efforts and investments successful.

Since the early 1990s, education reform has been a collaborative effort between leaders in the public and private sectors and educators. This has allowed the state to avoid many of the “education wars” that have embittered the climate in other states. To be sure, there have been fierce and healthy policy disagreements here, but opposing parties have usually kept their eyes on the consensus goal of education reform: all students learning at high levels.

Education reform is always a work in progress, requiring regular changes in policy, strategy, and practices. And now, after more than two decades of good work, we must admit that our strategies — regardless of their comparative success — have failed to achieve our overall goal of all students learning at high levels. We need to ask once again: What more needs to be done? How do we customize education to meet each child’s needs so that every child achieves success?

Looking ahead, one of the major challenges is obviously the budget. Current and anticipated budget shortfalls will pose serious threats to progress. Of course change in education doesn’t always have to cost more money, but it’s clear that we will eventually have to spend more on specialized services, including early childhood education, extended school days, summer learning, tutoring, and health and human service supports. We also need to reduce the cost of higher education.

Another challenge will be to avoid distractions and debilitating conflicts. Extremists would happily drive us into full-blown warfare over their favorite causes — whether safeguarding a sacrosanct version of standards and tests or tearing down the reform architecture of the past 20 years. For example, extremists in the charter school war want us to do continuous battle over whether charters are the “silver bullet” salvation of the public schools or the scourge of public education. We have fought these battles many times before and they are costly distractions from the business of formulating effective, long-term strategies for improving the education of our students.

There are a number of strategies that the state needs to develop over the next few years, including early childhood education, expanded learning time, career pathways, increased turnaround work, the better utilization of education technology, expanded access to top quality charter and innovation schools, higher education reform, and improved quality of teaching.

This is an enormous agenda. No single player could begin to accomplish it. Collaboration will be essential. Innovation will be vital. Making progress will depend on the cooperative efforts of the state and local elected officials, educators, unions, business leaders and the media, as well as students and their families. Education is vital to our success as a people, as a state, and as a nation. Getting to “all means all” would be an unprecedented achievement, but Massachusetts is still very well positioned to make a run at such an ambitious and historic goal.


Paul Reville is professor of practice of policy and administration at the Harvard Graduate School of Education, where he also leads the Education Redesign Lab. He is a former Massachusetts secretary of Education.

Opinion

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Opinion
Money Can’t Buy Vision

By PAUL McMORROW

In most formerly industrial Massachusetts cities, big, game-changing real-estate developments — the kinds of projects that have the potential to turn an entire city around — can’t get built because they don’t make sense economically for developers. And if the state started lining up smart but unfinanceable development projects from New Bedford and Haverhill to Pittsfield, and handing out subsidies to each one, the tab would quickly soar into the hundreds of millions of dollars.

Instead, the state earmarked just $16 million.

The notion that $16 million is enough to turn around a handful of economically lagging cities, let alone more than two dozen of them, should be absurd. The need in places like New Bedford, Lawrence, and Springfield is several orders of magnitude bigger. Even so, the state has managed to turn the sum into a big pile of money. It did so by focusing first on the thing that makes the state’s older industrial cities so compelling — the fact that they’re not faceless suburban subdivisions.

From Cambridge to Cleveland, cities are surging. Economic development is largely an urban game, because urban centers offer residents and businesses something they can’t get in a subdivision — authentic, compelling environments.

The comeback of the American city is a place-based phenomenon. It’s about tapping into what’s unique and vibrant about a specific neighborhood in a specific city. Boston’s Back Bay, Brooklyn’s gritty waterfront, and Pittsburgh’s booming public market are all contextual; they don’t happen in the abstract, which is why they’re all so difficult to replicate at the bottom of a suburban highway off-ramp.

From the canals in Lowell and Holyoke to New Bedford’s port, Malden’s classic downtown, and Chelsea’s industrial architecture, Massachusetts’ smaller cities are full of the types of urban amenities that have catalyzed development in other cities. Most just haven’t put all the pieces together in a systematic way yet. The $16 million the Legislature committed to turning these cities around was earmarked for a fund for transformative redevelopment projects. As one slug of money in a real-estate deal, the money won’t transform much. So the fund is being stretched as far as it’ll possibly go, by asking cities across the state to think deeply about the characteristics that make them compelling places.

MassDevelopment, the quasi-public agency administering the fund, put out a call earlier this year, asking cities to identify priority redevelopment districts for transformative projects. The agency put a few parameters on the call: cities could focus on just one development district, it had to be compact enough to walk through in five minutes, and cities had to identify private and civic redevelopment planning partners. Three winning cities would receive a slice of the state’s $16 million, in the form of a redevelopment planning fellow.

The MassDevelopment program asks cities to take a far more granular approach to development planning than they usually take. It leads with an authentic vision for a specific urban place.

“The older approach would be just putting something in, and assuming that, naturally, others would come after it,” says Anne Haynes, the director of the transformative development program at MassDevelopment. “We want to focus on the types of places and spaces that generate activity. So when the larger project comes in, it feeds off what’s around it.” For example, if a large new development rises in a downtown that’s full of storefronts that don’t make sense, the downtown won’t get the kind of boost it should.

This approach assumes that there will be more money coming down the line for large, transformative real-estate developments, but it also recognizes that these larger developments will work only if they’re tapping into a strong sense of place and a workable local development vision. It acknowledges that money to make unfinanceable developments financially feasible is important, but it also acknowledges that money can’t buy vision, and it can’t conjure a strong neighborhood out of nowhere.

Paul McMorrow is an associate editor at Commonwealth Magazine.

Opinion

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Opinion
How to Repurpose Your Thanksgiving

By BAYSTATE HEALTH PROFESSIONALS

Thanksgiving is about more than just enjoying a delicious holiday feast of turkey with all the trimmings, then heading out the door before the day is over to get a jump start on Black Friday bargains. Enjoying a healthy Thanksgiving also means sharing time with others and nurturing the mind and spirit as part of the holiday. In that spirit, Baystate Health professionals offer the following five tips to repurpose your Thanksgiving.

Get unplugged. “With our hectic lifestyles, many families find it increasingly difficult to maintain the valuable routine of having a family meal. Fortunately, the tradition of families eating a meal together is preserved on Thanksgiving. In order to make the most of this, it’s helpful for both young people and adults to strive to be truly present at the Thanksgiving table.

Consider adopting a new tradition which may not have been relevant in previous generations: as the food is being served, ‘un-serve’ all of the smartphones by asking everyone to put them onto a tray and remove them from the room. This will eliminate the temptation of checking e-mail and texting during the meal and help everyone to get the most out of the precious time of sharing a meal together and valuing the relationships and traditions of the family.” — Dr. Barry Sarvet, chief of Child Psychiatry and vice chair of Psychiatry, Baystate Medical Center

Exercise in the name of family and health. “It’s well-known that exercise has many health benefits, from lowering your blood pressure and cholesterol to helping prevent heart disease, to uplifting your spirits and managing depression.

Instead of plopping down on the couch and watching football all day on Thanksgiving, why not consider continuing quality family time after leaving the dinner table and taking a nice family walk, or even playing touch football outdoors? Other outdoor sports like soccer, or anything that gets you moving, such as turning up the music and dancing after your Thanksgiving feast, is good for your health.” — Dr. Quinn Pack, Heart & Vascular Program, Baystate Medical Center                        

Remember, it’s a time for giving. “Faced with the over-consumerism of today, especially on Thanksgiving, when some children may see a parent heading out the door even earlier now to grab up all the Black Friday bargains, it’s important to remember that our national holiday is made up of two words, thanks and giving. Adults need to remember what they were hopefully taught as youngsters, that it is better to give than to receive, and to pass that same wisdom onto their children.

Whether adult or child, scientific studies show that there are pleasure centers in the brain that are stimulated when we connect with someone in a meaningful way, such as volunteering at a homeless shelter or providing food for a family in need at Thanksgiving. Other research points to the fact that we are happier when giving and not focusing on the ‘me,’ and that can lead to both better physical and mental health.” — Dr. Laura Koenigs, interim chair, Baystate Children’s Hospital

Be thankful and mend relationships.  “The ‘thanks’ in Thanksgiving reminds us to be thankful for being together on the holiday. But what about those loved ones and friends we might be estranged from? Thanksgiving is a time to reflect on ways to improve family relationships. And eliminating latent feelings of disappointment and sadness over a stressed relationship can also benefit both one’s mental and physical health.” — Dr. Benjamin Liptzin, chair, Department of Psychiatry, Baystate Medical Center

De-stress your Thanksgiving. “Sure, you want everything to be just right for Thanksgiving, from a perfectly cooked Turkey to avoiding any conflict among relatives who might not always see eye-to-eye. It’s stress, holiday style. Making sure you get enough sleep leading up to the holiday can benefit your immune system and help keep you free of illness. Getting a good night’s sleep can also help to relieve stress and keep you alert, productive, and focused on the true meaning of the holiday.”  — Dr. Karin Johnson, director, Sleep Clinic, Baystate Medical Center

Sending a Message

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Health Care Sections
Holyoke Medical Center Works to Raise Its Profile in the Community

Spiros Hatiras

Spiros Hatiras says Holyoke Medical Center isn’t changing what it is and what it does — it’s just doing a better job of communicating it.

John Morris starts off by explaining that he’s a lighting technician and concert roadie by trade, and that if he doesn’t work, he doesn’t eat.

He goes on to note that he was a five-pack-a-day smoker and had long battled chronic obstructive pulmonary disease (COPD). His life changed, he implied, when a hospitalist at Holyoke Medical Center intervened.

“She just said, ‘you can fix this.’ You just felt like someone cared,” Morris said into the camera. “If it wasn’t for Holyoke Medical Center, I wouldn’t be going on tour with the Stones this fall.”

And with that 30-second message, now airing on several area television stations, Morris became part of an ambitious new marketing campaign launched by HMC this fall. This spot, like all the others, ends with another voice saying, “Holyoke Medical Center: experience the new standard in patient care.”

It’s not exactly a new standard, in the sense that the staff at HMC has always been caring and compassionate, said Spiros Hatiras, the system’s president and CEO. But it is new in the sense that many from this region, including some living in Holyoke and adjacent communities, are not familiar with the hospital.

This simple fact convinced Hatiras, who took the helm at the medical center 14 months ago, and others at HMC that they had to become more aggressive, and pointed, in their branding efforts.

“We’re not necessarily changing who we are — we’re just doing a better job of communicating it,” said Hatiras, who prefers the phrase ‘brand definition’ to ‘rebranding’ to describe what the system has undertaken. “The basic elements are still here — we are a solid, quality provider, and we’re a hospital of a size that is conducive to personalized care because it’s not very big and intimidating and confusing; we’re located in a great area, and we’re easily accessible. And at the same time, we’re big enough to have the services that most people would need.”

Elaborating, Hatiras said the basic goal of the campaign is to drive home the point that, in most cases, people in the Greater Holyoke area don’t have to drive past HMC on their way to Springfield, or anywhere else, to get the kind of quality care they want and need.

“There’s absolutely no reason, in my mind, why a resident of Holyoke, Chicopee, South Hadley, or Easthampton needs to go far away to another provider to receive the kind of care they can get here,” he explained. “Ultimately, what this campaign is aiming to do is let people know of the things we do and do well and what they can expect here, and keep people in the community.”

The marketing campaign includes a new logo (see page 29), television spots such as Morris’s, print ads (many of them in Spanish), billboards, banners within the hospital, and a revamped website. It’s all part of a multi-faceted initiative to raise HMC’s profile and increase volume, which also includes $2 million in upgrades to the Emergency Department and a new strategic plan.

HMClogoOverall, the system’s efforts are focused on putting out a new, stronger message, and then making sure it can back up those words ‘new standard in patient care,’ said Hatiras.

As for that logo, Hatiras told BusinessWest that it says different things to different people. To him, it speaks of both the region — through the use of the colors blue and green, representing water (Holyoke’s canals and the Connecticut River) and nearby mountains, respectively — and also a new beginning through its use of yellow.

“It’s a like a dawn, a new beginning, a bright day — that kind of feel,” he said. “That’s what we wanted to communicate.”

For this issue, BusinessWest takes an indepth look at this new beginning and the many forces that will shape it.

Ad Infinitum

“I’ve always looked at my patients, and cared for my patients, with the thought that that could be my mother, or that could be my grandmother, and I’ve always treated them as if they were mine, and I’ve treated them as I would want my family to be treated. I love being a nurse.”

That’s another of the 30-second spots airing on area television stations. It stars Lorimar Crus, a registered nurse who has been at HMC for three years. The sentiments she expresses reflect those of the system as a whole, said Hatiras, and sum up nicely both the message that is being sent through these various marketing vehicles, and the current focus of the system.

“While we’re not reinventing ourselves, I will say that we’re enhancing what we do and we’re focusing more on the experience that people have here,” he explained. “On the quality side, we do very well; we’re rated very highly. So what we’re really focusing on are those other qualities of the patient experience, or what people sometimes call the ‘softer skills’ — are we treating people with respect? Are we treating them with compassion? Are we treating people with empathy? Do we really care for people when they come in on a deeper human level?”

Hatiras said the work to revamp the system’s marketing efforts began almost immediately after he arrived last summer, because it was apparent that something needed to be done.

“We started talking about rebranding right away — at least started to think about how we needed to do significantly better in terms of communicating who we are, what we do, and what we do best,” he told BusinessWest, adding that these initiatives are being undertaken simultaneously with efforts to enhance (that’s a word Hatiras would use repeatedly) a culture of caring and compassion.

He said a market survey revealed that HMC’s primary problem wasn’t that people had a negative opinion of it, but that they didn’t have much of an opinion at all. Meanwhile, there was confusion, or ignorance, about the system.

“There were gaps in what people knew about us and about what we did; we still get confused with Holyoke Health Center, and frankly, there were people who didn’t know if we delivered babies here,” he went on, adding that the base of knowledge was broader in Holyoke, but much less so in surrounding communities such as Chicopee and South Hadley.

Hatiras believes HMC’s prior marketing efforts fell short for many reasons. For starters, there wasn’t enough of them, he said, adding that there was a also a lack of cohesion among messages sent by the medical center and its affiliates, River Valley Counseling Center, Holyoke VNA & Hospice Life Care, and Western Mass. Physician Associates, with each entity having its own logo, type style, and marketing strategy.

“No one could ever put it all together — no one really quite understood that the VNA was part of our system and River Valley was part of our system,” said Hatiras. “If your ads don’t all have a certain feel and look, they don’t resonate … if there’s nothing that ties it all together with the whole, it doesn’t make an impact.”

Part of the new branding initiative is broader outreach, especially to the Hispanic community, said Hatiras, adding that ads in Spanish are only a part of this effort.

For example, HMC was the lead sponsor of Holyoke’s annual Puerto Rican Parade in July. The hospital did not have much involvement with the event previously, he noted, and, ironically, Baystate Health was lead sponsor in recent years.

Care Package

But more aggressive marketing and greater outreach are only part of the equation, said Hatiras, returning to that phrase ‘softer skills’ and a recognized need to raise HMC’s game still higher.

“Even these have been core qualities of Holyoke Medical Center,” he said, referring to compassion, respect, and empathy. “What we’re doing now is putting a very significant internal focus on enhancing these qualities and making sure that we develop them further.”

The medical center is working with Pensacola, Fla.-based Studer Group, which, according to its website, “works to bring structure and focus to healthcare organizations through the creation of cultures in which people hold themselves accountable and help set them up to be able to execute quickly.”

HMC has ben working with the company for nearly a year now, and will continue to do so for at least three years, said Hatiras, adding that it takes time to make the kinds of fundamental changes the system is undertaking.

And there are several points of focus within this initiative, said Hatiras, listing everything from private rooms for all patients to revamped food service to valet parking for visitors. A common theme is to provide patients with a greater sense of control over their care.

“We started with some simple things, such as patient amenities,” he explained, “so that when people come here they feel safe, they feel they get treated the right way, and it’s a comfortable environment for them and their families.

“We’re converting all our rooms into private rooms so that there’s space for the family to visit and privacy, and we’ve revamped our food service so that people have choices in what they’re going to eat,” he went on. “When they get admitted, people have very little control over things, in general, and giving them the ability to have control is very important.”

Beyond these initiatives, HMC is also focusing on how the team administering care relates to patients and families.

“Studies have shown that, if physicians take the time to pull up a chair and sit next to the patient at eye level and communicate with them at that level, the interaction is much more meaningful, they get better information out of the patient, and the patient feels they’ll be listened to and understood a lot better than if someone stands at the foot of their bed,” he told BusinessWest. “By giving them that feeling of empathy, compassion, and respect, they heal better and faster.

“It’s just hard science — healing takes good medicine, and it takes good care,” he went on. “But it also takes that human touch, the compassion, the feeling of reducing the patient’s anxiety and making them feel safe.”

One priority for HMC is improving the environment in its Emergency Department, Hatiras noted, adding that the hospital was recently awarded $3.9 million by the Mass. Health Policy Commission to undertake renovations to the ER, and will launch a capital campaign to raise the balance of the projected $6-7 million project.

“The physical environment is very limiting and uninviting,” he said of the current emergency room. “It was built for 15,000, maybe 18,000 visits a year, and we’re doing 45,000.”

Brand Definition

Once the rebranding effort and other initiatives have gained traction, Hatiras said, HMC will conduct another market survey to see if attitudes, and overall awareness of the system and its services, have changed.

He suspects that they will change, and that verification will come in the numbers involving inpatient volume and, overall, the number of people driving elsewhere to receive care.

“The proof is in the pudding,” he said, adding that, while inpatient volume is down across the state, Holyoke’s rate of decline has been greater than in other areas. Reversing this outmigration, as he called it, will require a system-wide focus on not merely branding, but enhancing the patient experience.

And that’s what the system means by a ‘new standard in patient care.’

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

Opinion

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Opinion
Is Marijuana Medicine? Questions Remain

By ALAN EHRLICH, M.D. and KEVIN HILL, M.D., M.H.S.

Despite a federal ban, little research into its effectiveness, and lack of approval by the U.S. Food and Drug Administration (FDA), the use of marijuana for medical purposes has been approved in 23 states and the District of Columbia as of August 2014. More are likely to follow.

In Massachusetts, citizens overwhelmingly approved a ballot question in 2012 permitting marijuana use by patients with ‘debilitating medical conditions.’ With 63% of voters saying yes to the initiative, marijuana was declared medicine by plebiscite, a departure from the nation’s traditional way of testing and approving medications through controlled scientific clinical trials and subsequent FDA review and approval.

With regulations in place for the state’s medical-marijuana program that commenced in January 2013, and as marijuana dispensaries prepare to open, here’s a snapshot of the existing evidence on marijuana as medicine and what we believe patients should think about if they’re considering using it as such.

First, some background. Prompted by its potential abuse, the federal government initially banned marijuana in the 1930s. The U.S. Controlled Substances Act, passed in 1970, now lists marijuana as a Schedule I drug, regarding it as having a high potential for abuse and no medical benefit. With growing public acceptance of the drug, however, the federal government has effectively ceded regulation of marijuana to the states. Because of the federal classification, few studies exist of marijuana’s medical value, making it hard to draw sound conclusions about its medical benefits.

Available research shows that marijuana has benefits for symptoms associated with some conditions, among them spasticity (spasms) from multiple sclerosis, chronic pain, pain from neuropathy, nausea or vomiting from chemotherapy, and inflammatory bowel disease. It also stimulates the appetite of patients with cancer-associated anorexia and in HIV patients with significant muscle wasting. Many patients believe it also helps with glaucoma because it lowers the pressure in the eyes, but there is no evidence that marijuana helps with the symptoms of glaucoma, and newer medicines are more effective for the condition.

Dosage and concentration remain major concerns. No guidelines on dosage exist for any condition, and different marijuana plants have different concentrations of THC, the drug’s active ingredient that gives it its narcotic and psychoactive effects.

While marijuana appears to have some benefits, research shows that clear harms are associated with its chronic use. It may worsen anxiety and depression, induce psychosis, and cause cognitive difficulties because of its effects on the brain. Cognitive effects are especially worrisome in adolescents and young adults whose brains are still developing. Chronic users trying to stop may also experience withdrawal symptoms, much like those of nicotine withdrawal.

The majority of people who use marijuana do not become addicted, but 9% of adults and 17% of teenagers do. Those percentages may be low, but considering that marijuana is the most commonly used illicit drug in the U.S., with more than 18 million users, a small fraction of a large number can still be a very large number.

Patients considering marijuana as medicine should first talk with a physician who knows them well. We suggest starting with your primary-care doctor. If you’re under the care of specialists, such as a pain-management physician or oncologist, talk with him or her, too. All physicians treating you should know if you’re using marijuana for medical reasons, as it could interact with other medications.

It’s important to understand that physicians in Massachusetts will not be prescribing marijuana for patients. Rather, they will be certifying that a patient has a ‘debilitating medical condition’ eligible for medical marijuana according to state regulations. Also, physicians who are generally opposed to smoking are not required to certify any patient, and some may decline to do so because of the federal ban or limited clinical evidence.

Whatever role marijuana may have as medicine, we believe it should be a supplement to standard treatment. There isn’t any condition for which it should be the first line of therapy.

Dr. Alan Ehrlich is senior deputy editor of DynaMed, a clinical reference tool that examines medical articles for clinical relevance and scientific validity. Dr. Kevin Hill is director of the Substance Abuse Consultation Service in the Division of Alcohol and Drug Abuse at McLean Hospital in Belmont. This article is a service of the Mass. Medical Society.

Opinion

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Opinion
Health Officials Vigilant Against Ebola

By CHERYL BARTLETT

To date, in Massachusetts, we are fortunate there have been no cases of Ebola virus, and the risk remains very low.

Ebola was first identified in the 1970s, and since that time there have been sporadic and limited outbreaks. This year, 2014, the Ebola outbreak has reached epidemic proportions in West Africa. The U.S. has treated several citizens evacuated from West Africa after contracting Ebola while caring for patients. One person exposed in Africa traveled to Texas and became symptomatic four days after arrival, was eventually treated, and then, sadly, died.

Since that time, two healthcare workers have been confirmed with Ebola. We are taking this very seriously, and I want to thank the many organizations and public officials that are working to stem this epidemic, including many healthcare providers, scientists, and public-safety professionals.

While Ebola is a very serious disease, it is one that health experts — and our medical community here in Massachusetts — understand and are prepared for. Ebola is less communicable than some other infectious diseases, as it can only be spread through close, direct contact with an infected, symptomatic person’s bodily fluids. As such, Ebola can be contained and prevented with careful, stringent application of core public-health measures. With our clinical partners, we intend to combat and treat Ebola very aggressively and provide all necessary supportive care in the highly unlikely chance a case is identified.

As such, we have taken the following proactive steps to ensure that our public-health and healthcare system partners are prepared:

• The DPH has established a dedicated Ebola webpage (www.mass.gov/dph/ebola) to provide a single reference point for clinical advisories, guidance, and links to information provided by the CDC and the World Health Organization (WHO).

• The department has issued a series of guidance documents, developed by DPH and/or the CDC, to address questions related to management of suspect cases, screening of returning travelers, laboratory guidance for the handling of suspected specimens, as well as preparedness checklists.

• Our Bureau of Infectious Disease and the state Public Health Laboratory (SPHL) are in regular contact with their counterparts at the CDC, and that contact has increased as the department has intensified Ebola preparations. Additionally, the department remains in close contact with other local and state agencies and professional associations.

• DPH has held a series of statewide conference calls with partners that include hospitals, community health centers, emergency medical services, ambulatory-care organizations, colleges and universities, local boards of health, and public safety.

• The BID Epidemiology Program routinely performs outbreak investigation, contact tracing, coordination with local health authorities and SPHL, and, when necessary, coordinates isolation and quarantine procedures.

• The Massachusetts State Public Health Laboratory one of only a handful of state laboratories which the CDC has approved to perform preliminary testing for Ebola, with confirmatory testing performed by the CDC.

• To prepare for the possibility of receiving a suspect or confirmed case of Ebola, we have advised hospitals to review their infection-control protocols and provide preparedness trainings. DPH plans to send staff out into the field to partner with hospitals and their frontline staff to support implementation of these critically important protocols and trainings. The CDC is also stepping up its training and outreach to health care providers.

We should not let our guard down; preparation must continue to be a top priority. While the chance of Ebola transmission occurring in Massachusetts remains low, we continue to be proactive and comprehensive in our preparedness efforts.

Cheryl Bartlett is commissioner of the state Department of Public Health (DPH). These comments were condensed from her testimony last Thursday before the Joint Committee on Public Health Ebola Preparedness.

Greater Chicopee Chamber Urges Rejection of Paid Sick Leave

By
Daily News

CHICOPEE — After deliberation by its government affairs committee, executive committee, and board of directors, the Greater Chicopee Chamber of Commerce has taken the position of ‘no’ on Question 4 — mandatory paid sick leave — which will appear on the November statewide ballot.

Question 4 would make Massachusetts one of the first states to require small and taxpayer-funded businesses to provide up to a week of mandatory paid sick time and family leave to all employees, including part-timers, and allow them to take it in increments as little as one hour at a time.

“This mandate, in our opinion, strips employers of their ability and flexibility in structuring employee benefits how they see fit to best suit the business and their employees’ needs,” the chamber said in a prepared statement. “Furthermore, to pay for the added benefit of paid sick days and still remain on budget, employers will be forced to reduce current labor spending through reduced wages and hours, layoffs, and reduction of other, more desirable benefits. Adoption of this mandate will increase the cost for employers and directly lead to lower wages for employees. This proposal is too costly and will disrupt the existing relationships between employers and employees.”

Opinion

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Opinion
NFL Drops Ball on Domestic Violence

By Carol Fusia Campbell

I love the game of football. I grew up around the sport. My father was a football coach, and our family lived, breathed, and ate football.

But National Football League Commissioner Roger Goodell’s handling of the Ray Rice situation sickens me. It sickens me that there is any doubt that domestic violence should receive a swift, definitive penalty. It sickens me that, for even one moment, the owners and the commissioner tried to find justification for Rice dragging the limp body of his then-fiancee off an elevator. It sickens me that an NFL player receives harsher penalties for using illegal and performance-enhancing drugs than for physically abusing the women in their lives.

The Rice scandal has made clear that the professional organization that represents football must make a dramatic shift in their policies regarding domestic violence.

As a long-time board member of the Women’s Fund of Western Massachusetts, I’ve learned that intimate-partner violence is a complex social problem that requires interventions on a variety of levels.

A good place to start is the code of conduct. It’s common knowledge that the league spells out, with shocking detail, rules of glamour, etiquette, and hygiene for cheerleaders. The cheerleader tome also includes a multitude of ways in which the woman can be punished with fines and game-day suspensions, or even fired, for ongoing makeup infractions. The NFL should be no less strict in their code of conduct for their players. The commissioner must craft a strong, unambiguous set of guidelines regarding domestic violence and immediately communicate these no-tolerance guidelines to players, coaches, and team owners.

In addition, one of the most effective interventions is peer pressure — men making it clear to other men that it’s simply not OK to abuse women. Commissioner Goodell had an opportunity to send this message after being confronted with evidence that Rice punched his fiancee, now his wife, in the face, knocking her out cold. The commissioner squandered this opportunity.

The NFL should not do the same. Instead, its owners should dismiss Commissioner Goodell to signal the beginning of a new no-tolerance policy. They should then use their incredible reach and influence to educate men on how violence against women threatens the very fabric of our communities.

When women are not safe in their intimate relationships, they are not able to hold jobs, pursue education or technical training, or secure stable housing for themselves and their families. The NFL should work with experts like the Women’s Fund who can help shape this proactive education along with community partners.

I will always love the game of football. But the NFL must draw a bright line between right and wrong when it comes to domestic violence before I can fully embrace the organization.

Carol Fusia Campbell is president and CEO of Chicopee Industrial Contractors and the daughter of Vic Fusia, who coached football at Brown University, the University of Pittsburgh, and UMass, and also scouted for the NFL’s San Francisco 49ers. She was recently named Woman of the Year for 2014 by the Professional Women’s Chamber.

Opinion

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Opinion
Baseball, Youth, and Smokeless Tobacco

By RICHARD PIETERS, M.D. and ANTHONY GIAMBERARDINO, D.M.D.

The headlines first came with baseball Hall of Famer Tony Gwynn. His all-too-early death at 54 was attributed to the long-term use of smokeless tobacco. Now it’s former Red Sox pitcher Curt Schilling, who revealed on Aug. 20 that he was diagnosed in February with mouth cancer. “I do believe without a doubt, unquestionably,” said Schilling when making his condition public, “that chewing [tobacco] is what gave me cancer … I did it for 30 years. It was an addictive habit.” His physician agreed.

Many of us who grew up with the game are used to seeing players chewing tobacco, but a new generation of children watching in the stands and on television may be seeing smokeless tobacco used for the first time. They are the ones most influenced by what baseball players do both on and off the field. And that behavior by professional athletes can be more powerful in shaping behavior than any advertising campaign by the tobacco industry.

Although cigarette smoking in the U.S. continues to decline, a report from the U.S. Centers for Disease Control and Prevention (CDC) indicates that the use of smokeless tobacco has held steady over the past nine years. CDC says 14.7% of high-school boys, and 8.8% of all high-school students, reported using smokeless products in 2013.

The CDC further states that smokeless tobacco contains 28 carcinogens, which can cause gum disease, stained teeth and tongue, a dulled sense of taste and smell, slow healing after a tooth extraction, and, worst of all, oral cancer.

Smokeless tobacco is not harmless. According to the National Institute on Drug Abuse, it delivers more nicotine than cigarettes and stays in the bloodstream longer. Clearly, tobacco use is both a serious medical problem and an oral-health problem.

In a letter to baseball commissioner Bud Selig following the death of Tony Gwynn, nine leading healthcare organizations, including the American Medical Assoc. and the American Dental Assoc., stated that “use of smokeless tobacco endangers the health of major-league ballplayers. It also sets a terrible example for the millions of young people who watch baseball at the ballpark or on TV and often see players and managers using tobacco.”

Oral cancer continues to be a serious problem in the U.S. More than 30,000 new cases are diagnosed each year, and the five-year survival rate is only around 50%. While a batting average of .500 would be considered outstanding in baseball, 50/50 odds aren’t very good in the game of life.

The connection between oral health and overall health is well-documented. What happens in the mouth can affect the entire body. Physicians are now being trained to examine the mouth and work with dentists to make patients more aware of the importance of oral health as it affects their overall health and well-being.

Programs such as the Mass. Dental Society’s Connect the Dots, in which physicians and dentists work together in the community, and the Mass. Medical Society’s establishment of a Committee on Oral Health mark the beginning of a growing relationship between physicians and dentists to promote oral health in the Commonwealth.

But oral cancer isn’t the only health risk from smokeless tobacco. Users have an increased risk of heart disease, high blood pressure, heart attacks, and strokes. Many health issues are preventable, especially those related to tobacco use. The medical and dental professions can play a key role by providing education and screening for oral cancer.

Major-league baseball players have an important opportunity to contribute to this educational process by aiding in prevention efforts, particularly aimed at impressionable young people. For the past four years, the Mass. Dental Society, in partnership with NESN and the Boston Red Sox, has produced TV campaigns on the dangers of smokeless tobacco.

The Mass. Medical Society and the Mass. Dental Society are committed to reducing tobacco use in all its forms and welcome the continued participation of the Red Sox and all of major-league baseball. In 2014, chewing tobacco continues to be as much a symbol of baseball as the actual action on the field.

For the health of our children, shouldn’t this image of our national pastime now be considered past its time? The cases of Tony Gwynn and Curt Schilling should serve as a warning to us all.


Dr. Richard Pieters, a radiation oncologist at UMass Memorial Medical Center in Worcester, is president of the Mass. Medical Society. Dr. Anthony Giamberardino practices general dentistry in Medford and is president of the Mass. Dental Society.

The IRS and Form 1099-K

By
Banking and Financial Services Sections
Government Secrecy on Cash and Credit Transactions Is Troubling


By PAUL MANCINONE

Back in May 2013, our firm wrote an article for Accounting Today, “Taxing Times for the Restaurant Industry.” We followed that up with another, “Taxing Times Two for the Restaurant Industry,” which was published last month. Most recently, the Kiplinger Tax Letter contacted us, and we shaped the 1099-K paragraphs published in the Aug. 29 issue of its biweekly Tax Letter. These articles focused on the use of Form 1099-K, the IRS-mandated procedure for reports issued by credit-card companies to taxpayers that accept credit cards for payment, which we’ll attempt to summarize herein.

While the articles were focused on the restaurant industry, an area where we do a lot of representation work, the issue is not at all exclusive to any particular industry, although the IRS and the Massachusetts Department of Revenue (DOR) do target restaurants heavily. This trend involves any retail enterprise that collects its revenues in both cash and credit-card transactions. Any small business that accepts cash and credit cards as payment is a potential target.

If you aren’t familiar with Form 1099-K, you should be. According to the IRS, “the 1099-K is an IRS information return for reporting certain payment transactions to improve voluntary tax compliance.” That’s for sure! The IRS has a mechanism to compare Form 1099-K to gross receipts reported on a tax return, which is then used to create audit leads.

As an example, let’s again look at the restaurant industry. Let’s say there are two restaurants, located in the same geographic area, both with $1 million in gross receipts. Restaurant 1 has 75% in credit-card sales, while Restaurant 2 has 95% in credit-card sales. The IRS and the state DOR can now very easily see that Restaurant 1 does 25% of its sales in cash, and Restaurant 2 does only 5% of its sales in cash. No need to guess which restaurant here is the audit lead — it’s Restaurant 2.

This type of analysis is happening right now, to all types of closely held retail enterprises, such as hair salons, restaurants, hardware stores, jewelers, ski shops, grocery stores, you name it. The IRS is compiling the data it receives from tax returns from these various industries, obtaining an acceptable ‘range,’ and using the data to compare with retail establishments that appear to be reporting less than what the IRS believes to be their fair share of cash sales, and going after them.

But what is a reasonable percentage of credit-card sales for a particular industry? If an auditor says, “your client’s credit-card-to-gross-receipts percentage is too high,” i.e., meaning not enough cash reporting, that is based on what authority? I would suggest that the 1980s are long past, and plastic here to stay. Everyone reading this knows the prevalent use of credit cards, even at low-price-point establishments like the local donut shop, where cash was king just 10 years ago. Yet, this is an audit approach used by the IRS and the DOR. Even worse, tax representatives, as well as all the targeted industries, are fighting with one hand tied behind their backs, and here’s why.

We submitted a Freedom of Information Act request to the IRS, specifically requesting research data related to credit-card-to-gross-receipts percentage as it relates to the restaurant industry, preferably allocated by region, if at all possible. Oh, we got an answer, all right. Our “request was denied for law-enforcement purposes.” So not only is the IRS targeting closely held retail establishments, using this 1099-K analysis as its tool, but it’s not going to share the results of its studies, which, by the way, were gathered from tax returns of U.S. taxpayers.

I believe this was very unfortunate, but not much of a surprise. The IRS is a little weak in public opinion right about now, and not exactly transparent. But this secrecy is shortsighted. Taxation in the U.S. is getting increasingly voluntary as the IRS gets its funding scrutinized (and diminished) in the wake of the Lois Lerner fiasco. One would think that releasing this data would be a wonderful aid. At least then it would get a dialogue going between accountant and business owner.

Maybe there are valid explanations for a high credit-card percentage. And if there isn’t a good explanation, having access to this ‘secret IRS data’ may raise revenues for the U.S. Treasury, as errant retail establishments can pay more attention to their income reporting (i.e. self-audit). The IRS refusing to reveal this data does nothing to help the voluntary compliance that is unquestionably more necessary with the IRS’s limited resources.

Maybe a business has been subject to theft — less cash. Perhaps it’s in a business area with patrons using credit cards almost exclusively — less cash. There are myriad explanations to address a variance. But there is no way to know if there is a variance if the IRS is not forthcoming with benchmark data.

I believe that this type of information will eventually be released via litigation. It seems to me that, at a tax-court adjudication level, if a taxing authority uses a credit-card-to-gross-receipts test as part of its analysis, that data will need to be produced at the litigation level and subject to review by the opposing side.

For retail establishments that find my thoughts a potential concern, I would urge them to get into contact with their trade associations to request this information and publish it for its members. From my experience, no one has as of yet. It is as important, if not more so, than the other multitude of trends these associations release — the vast majority of which are interesting, but much less relevant to income taxes.

We also urge the IRS to reconsider its poor decision to refrain from releasing this data, gathered from taxpayers, for the benefit of taxpayers.

Paul L. Mancinone is president of Paul L. Mancinone Co., P.C. in Springfield; (413) 301-8201.

Opinion

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Opinion
Electricity Grid Bending, and Might Break

By MARC BROWN
For the past two years, New England has seen its energy rates rise from $.036 per kWh in 2012 to $.056 per kWh in 2013 — more than a 50% increase. New England ratepayers paid an additional $3 billion for the energy we consumed last winter, and as a result of capacity shortages in the most recent auction, we will be doling out an additional $1.8 billion in payments to generators just to be available.

The regional organization which oversees our energy grid, ISO New England, has repeatedly warned us of our overreliance on natural gas for electricity generation, which currently accounts for more than half of our capacity. Add to that 8,000 megawatts of expected-to-retire generation over the next decade, and New England is looking at a real future capacity shortfall — a gap that all of the energy efficiency, conservation, and demand response in the world won’t be able to close.

Rightfully, ISO’s warnings have led to panic among the region’s legislators and bureaucrats — ironic, considering that they and their predecessors supported, promoted, and enacted policies that have led us to our current situation — as well as high prices and dwindling base-load capacity. Policies like renewable portfolio standards, the renewable greenhouse-gas initiative, net metering, and others have favored expensive, intermittent renewable power at the expense of more affordable and reliable base-load options.

We are going to need new base-load generation to power our homes, businesses, hospitals, and schools. Unfortunately, the way the energy markets are designed offer little incentive for new investment. Capacity markets are too shallow (three years) and are subject to price caps that are in place to protect ratepayers, but in the long run may do more harm than good. Extending capacity to five, six, seven, or more years might be enough incentive to bring new capacity into the region. It may also provide some financial security to natural-gas electricity generators, allowing them to make longer-term fuel commitments, which in turn should spur private investment in new natural-gas pipelines. Ratepayers could ultimately benefit from a market that trades higher capacity payments for lower energy payments.

New Hampshire’s Northern Pass (1,200 MW) and the Footprint natural-gas plant in Salem (700 MW) are two projects that could bring much-needed base-load power to New England, but both have been met with opposition. Footprint, whose future is in question, has been opposed by environmental groups like the Conservation Law Foundation because it is a fossil-fuel generator, despite the fact that it emits half of the CO2 and none of the SOX of the plant that it would replace. Northern Pass has been opposed by myriad environmental groups, as well as the New England Power Generators Assoc. (NEPGA), a trade organization representing the owners of more than 100 electric power plants in New England who control more than 80% of New England’s generating capacity.

NEPGA’s responsibility is to advocate for its membership, many of whom have benefited from the high prices that have hit ratepayers the past two winters. ISO’s day-ahead electricity auction is a “clearing auction,” which means that all generators who clear the market receive the marginal (or highest) cleared rate. For example, if a 1,000-MW generator bids into the market at $20 per megawatt hour to cover its cost of generation and the market clears at $50 per MWh, the generator will make $30 per MWh in profit, or $720,000 for that day. During a cold week this past January when the average day-ahead price exceeded $262 per MWh, a 1000-MW generator would have received more than $44 million in energy payments alone.

New Englanders are looking for relief from high energy costs, regulators are looking to ensure reliability, and, despite their poor track record, policy makers are looking to address our long-term energy needs. Sooner, rather than later, New England is going to need more base-load electricity to replace retirements.

The Farmers’ Almanac is predicting another bitterly cold winter for New Englanders. Vermont Yankee and its 600 MW (600,000 homes) will be powering down for good at the end of December. Run to your local hardware store and get your generator now, because, if January 2015 is as frigid as January 2014, rolling blackouts might be in our future — and while not all of us will be surprised, some of us will have a lot of explaining to do.

Marc Brown is the executive director of the New England Ratepayers Assoc., the nonprofit dedicated to protecting ratepayers in New England.

Opinion

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Opinion

Education Alone Won’t Save the Economy

By ROBERT KUTTNER

Our economy is now five years into an economic recovery, yet the wages of most Americans are flat. For the entire period between 1979 and 2013, median worker wages rose by just 7.9% while the economy’s growth and productivity rose 64.9%. The top 1% has made off with nearly all of the economy’s gains since 2000.

Is there nothing that can be done to improve this picture? To hear a lot of economists tell the story, the remedy is mostly education. It’s true that better-educated people command higher earnings. But it’s also the case that the relative premium paid to college graduates has been declining in recent years. If everyone in America got a doctorate, the job market would not be transformed. Mainly, we’d have a lot of frustrated, overeducated people.

The current period of widening inequality, after all, is one during which more and more Americans have been going to college. Conversely, the era of broadly distributed prosperity in the three decades after World War II was a time when many in the blue-collar middle class hadn’t graduated from high school.

I’m not disparaging education — it’s good for both the economy and the society to have a well-educated population. But the sources of equality and prosperity mainly lie elsewhere.

Three big things have changed in recent years that better explain why this recovery is accompanied by flat wages.

First, the financial collapse is still exerting a drag on the economy. Until the crash of 2008, ordinary families whose incomes had not kept pace with the cost of living had been borrowing to sustain their consumption. Americans ran up credit-card debts, borrowed to attend college, and above all borrowed against their homes. All of that camouflaged stagnant earnings. But the crash ended the borrowing binge. Without increasing debt (which is the wrong remedy), household purchasing power is too low to stimulate a strong recovery.

Second, corporate America got increasingly into the habit of hiring people on a temporary, part time, or contracted-out basis. Traditional payroll jobs became harder to come by. A small fraction of Americans turned this new insecurity into a plus, becoming entrepreneurs. But for every successful Internet startup and every truly joyous freelancer, there are dozens of people for whom working as a ‘consultant’ is nothing but disguised unemployment.

Third, the sources of labor bargaining, including strong federal labor-market regulation and trade unionism power, have been weakened. In their absence, corporations and investors are able to capture the lion’s share of the economy’s productivity growth.

So, are we just stuck? Do the characteristics of the new economy simply doom us to flat incomes for most people and stratospheric gains for the few? Actually, several things could be done to restore a better distribution of the economy’s productivity growth. But most of them are outside mainstream political debate.

A good historic parallel is the burst of deferred growth that came with World War II. In 1940, unemployment topped 13%, and many economists argued that technology had displaced so many human workers that this was the best the economy could do. But by 1942, unemployment had vanished.

In the intervening two years, workers did not suddenly become smarter, better educated, or more diligent. Rather, the government borrowed money and taxed the wealthy in order to massively invest in fighting World War II. The war, in turn, became the greatest accidental economic stimulus program ever. As a side effect, wartime spending produced scientific breakthroughs and technological gains as well as more purchasing power.

Today, we don’t need another war. But we do need major investment in decaying public infrastructure and in transition to a green, sustainable economy.

The wartime economy propelled America into the post-war boom and laid the groundwork for the post-war middle class. After the war, we doubled down with social investments such as the GI Bill and major infrastructure projects, as well as minimum-wage regulation.

We could do it again. All that stand in our way are a lot of bad economics and a consensus of the elites that cutting deficits and rewarding speculators take precedence over rebuilding the country. The obstacles to restoring prosperity are not economic. They are political.

Robert Kuttner is co-editor of the American Prospect and professor of Social Policy at Brandeis University.

Opinion

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Opinion
Five Principles for an Open Internet

By ANDREW LIPPMAN

In the past few months, the open Internet has been everywhere from Comedy Central to the Harvard Law Review. Why? Because the U.S. government is at a crossroads in deciding how Americans will access it. The FCC solicited comments from the public, and more than 1 million people responded. But getting this one right doesn’t have to be complicated.

The FCC was created in 1934 to ensure that citizens throughout the country had access to affordable telephone service. We need a similar mandate today for Internet access. Here are five principles that can help us reach this goal.

Principle 1: It’s about more than money. A common metric used to measure the success of the Internet has been the number of commercial successes it has enabled. But a far better measure is the number of attempts at innovation it has allowed. Sure, there are the Ubers and Googles and Facebooks that have made many billionaires. But more important is the vastly reduced barrier to simply trying a new idea. This low barrier is a far better measure of an entrepreneurial society. Attempts are a proxy for opportunity, and while many of these do not explosively succeed, the people who make the attempts are invariably better off for it, as is society at large. Let’s drop the economic argument that success is the only metric and place appropriate value on the social goal of giving everyone a chance. After all, opportunity is the American way.

Principle 2: The Internet is a learning engine. We spend endless energy considering how to reform schools to make an educated populace, but the Internet has done this by creeping through the back door. There are two essential aspects of learning where the Internet succeeds and traditional educational institutions fail. First, it builds an accessible reference that creates communities of knowledge, and second, it establishes a forum where people can experiment, debug, and contribute. Both are essential, but only the first is measurable. Open courseware, the open-source programming movement, and Wikipedia are wonderful examples; they have transformed learning from memorization to access and participation. The results are clear.

The second aspect, however, is less obvious. In the 1960s, Seymour Papert invented Logo as a way for kids to learn mathematical principles through creation rather than rote. Modern iterations stress everything from creating animated stories to learning programming. More generally, the reduced barrier to trying a new idea transforms society, but it also is now affecting everything from technical learning to creative expression.

Principle 3: Symmetry is the norm. The Internet transforms us from passive consumers to active participants. The technologically enforced distinction between those who make bits and those who consume them has been eliminated. That separation is a holdover from the ancient past of mass media — think bloggers versus couch potatoes. At the MIT Media Lab, for example, students can pop up a server at the drop of a hat and publish a website, an application, or a new e-commerce experiment overnight. Can’t we make sure that everyone everywhere has the same chance?

Principle 4: Give me at least a bitway. Open Internet access has to be a simple duty of any owner of an information/communications franchise. The idea that someone can rent our airwaves and then privatize all the information that flows through them is abhorrent. Would we allow anyone to rent a public street and then charge us for its use? Of course they can provide specialized services such as movies, sports, and shopping, and of course they can profit from them. But it has to be done on top of a robust infrastructure that is open to all. This is a civic responsibility.

Principle 5: Don’t throttle the open Internet. The basic infrastructure for an open Internet cannot be diminished in favor of those higher-profit services. A way to think about this is that there are public roads and toll roads that can exist side by side. But we have to make sure that every improvement made to the toll road is matched by an equal improvement to the free road. Otherwise, if you can’t pay the toll, you’re out of luck — and at the mercy of potentially narrow interests.

None of these ideas are revolutionary. But all too often, they create a polarized debate about regulation versus corporate freedom. And that misses the point. The current laws also don’t help. They are garbled and were written before the patterns of use and technologies of access had matured to where they are today. Using these principles as a guide, we can achieve an open Internet — without bitterness or legal wrangling.

Andrew Lippman is a senior research scientist and associate director at MIT’s Media Lab. This article first appeared in the Boston Globe.

Opinion

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Opinion
Bay State Is Gaining Ground — Literally

By JACK CLARKE

By the year 2050, Massachusetts needs 52% of the Commonwealth to be permanently conserved as open space.

Currently, a quarter of the Bay State’s 5 million acres of space is developed, a quarter is protected, and the rest is up for grabs.

Of that remaining land, we need to set aside a little over half, or 1.5 million acres. These are the lands identified by scientists, state environmental agencies, and the land-trust community as most important to the biological diversity of the Commonwealth, and critical to a strong, healthy, and vibrant environment — an environment undergoing rapid, unprecedented climate change.

That leaves more than a million acres available for development. Building on that land will require a statewide strategic-planning initiative that advances the best available smart-growth techniques while supporting the economy and our quality of life. This includes conservation subdivision design, transit-oriented development, and zoning that protects Massachusetts’ traditional working landscapes of forests, farms, and waterfronts.

Over the past decade, Massachusetts targeted real estate worthy of acquisition by focusing on protecting endangered species, establishing woodlands and parks, and guarding drinking-water supplies. Today however, as the planet rapidly warms, there is an urgent need to step up the pace of land stewardship by defending the remaining critical natural areas from not only the bulldozer but also the severe impacts of human-induced climate change.

Achieving our land-conservation targets does not mean job done, work over, mission accomplished. The focus of our efforts will shift as we strive further to restore ecosystems to a condition that takes advantage of their resiliency and adaptability. This renewed natural defense will ready the ecology of the Commonwealth to face the impacts of global warming and the more frequent storms, rapidly rising seas, and temperature extremes that go along with it.

The tasks include rebuilding wetlands, rivers, and watersheds to re-establish their flood-storage capacity; sustainably protecting forests so they can clean the air, filter water, and absorb heat-trapping carbon pollution; and managing coastal beaches, banks, and dunes for their ability to save people and uplands from hurricane-force storm surges.

In its newly released fifth edition of the series “Losing Ground,” Mass Audubon reports that, between 2005 and 2013, public and private organizations protected 41 acres a day of green space and developed 13. Not bad for the third-most densely populated state in the union, especially when compared with our recent development history.

Back in 1987, Mass Audubon documented that, in the previous six years, more than 100,000 acres of land were built upon. As recently as 2003, 40 acres a day were being consumed by large-lot development and suburban sprawl, with only 20 a day being protected. Six years later, those figures reversed in a real success story for Massachusetts.

The fact that we have managed to slow the rate of open-space conversion and protect more land over the last decade demonstrates how well-planned conservation efforts can work alongside economic-development initiatives. While protecting open space, Massachusetts has been rebounding from the Great Recession and credit crunch, with housing starts, job creation, and overall growth on the upswing. This is proof we can do both: conserve land and provide for the economic well-being of our residents.

By targeting places most suited to protection and areas most appropriate for development, we can ensure that we will continue to safeguard the public health, grow the economy, and support the environment. Our responsibility, to this and succeeding generations, is to protect the nature of Massachusetts for people and wildlife in the face of a rapidly warming climate.

Jack Clarke is director of public policy and government relations for Mass Audubon.

Editorial

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Opinion
Adjusting to a New Economic Reality

Andre Mayer appears to be right, but we sure hope he’s wrong.

Mayer, senior vice president for communications and research at Associated Industries of Mass., was talking with BusinessWest about the economy and, more specifically, the recovery and why it really hasn’t materialized (see story, page 6).

And he proffered the opinion that, five years after the recession ended, it might be time to say this just might be as good as the recovery is going to get.

Like we said, we hope he’s wrong about that.

The regional economy has really seen only modest growth since the end of the Great Recession, maybe a percentage point or two each year, and many business owners are still waiting for that surge, boost, spurt, whatever one chooses to call it, that officially signals the end of a downturn and the start of real recovery.

What Mayer is saying, and he’s apparently not alone in this thinking, is that what we’re seeing is real recovery, or at least the new reality when it comes to the economy.

It comes with modest growth in jobs (and even that has arrived mostly in recent months) and only slight gains in gross domestic product. These are just some of the defining elements of something called ‘secular stagnation,’ an economic theory supported by former Treasury Secretary Larry Summers and many others, which contends that a host of factors, from advancing technology to globalization, are keeping this recovery from gaining any real steam in many sections of the country.

Secular stagnation might indeed be real, but our regional economy should be doing better. As Bob Nakosteen, professor of Economics at UMass Amherst, pointed out, conditions for pronounced growth are there, especially an improvement in the financial situation in many households, and businesses as well. Many have reduced debt and righted balance sheets that certainly contributed to the severe downturn at the end of the last decade.

What’s still missing, in many cases, is that all-important commodity known as confidence. A lack of it is still holding a number of business owners back when it comes to expanding their ventures and adding to their workforces. Some sectors are experiencing modest growth, including education and healthcare, the pillars of the local economy, but many are still treading water.

And while the state’s June employment report was encouraging — the jobless rate was at its lowest point since 2008, and another 3,700 jobs were added — there were disturbing declines in the manufacturing and construction sectors, two areas that were supposedly on the upswing.

As area commercial lenders told BusinessWest, business owners read and hear about improving conditions, job gains, and an uptick in business confidence, but don’t necessarily believe what they’re seeing or hearing.

Thus, many are still hunkering down and continuing to do the things that got them through the recession — tightening their belts, creating greater efficiency, and hiring only when they have to.

Mayer believes that some attitudes may be changing when it comes to the economy and the recovery. He believes that some business owners are recognizing that maybe that surge everyone is waiting for simply isn’t going to happen, and that it doesn’t make sense to continue waiting for it. Better still, he believes that some are coming to the conclusion that, by not waiting, they may actually help facilitate that surge.

On this point, we hope he is correct.

If he is, then maybe the current state of the recovery doesn’t have to be the new reality, and this is not as good as it’s going to get.

Opinion

By
Opinion
A New Framework for Medical Care

By KERRY ANN HAYON

Whether practices have gone through the National Committee for Quality Assurance’s (NCQA) rigorous process or have unofficially structured themselves as a medical home, the patient-centered medical home (PCMH) movement here in Massachusetts continues to expand.

The PCMH elements outlined in Chapter 224 — the state’s healthcare cost-containment law — and the goal of the state Executive Office of Health and Human Services are to have all primary-care practices in the state become patient-centered medical homes by 2015.

The PCMH movement has been focused on primary-care practices, but specialty practices are increasingly adopting the concept of the medical-home model as well. In order to accommodate this growing demand, the NCQA recently rolled out a patient-centered specialty-practice designation.

In talking with physicians and practice managers, I often encourage them to start by considering the following high-level framework:

• Do you have access to data? The ability to drill down and access patient-level, disease-specific data and to identify what your practice considers complex and high-risk patients is an important component of the medical-home model.
• What are your processes? Often practices have processes, but they may not be clearly outlined, documented, or well-communicated. Having your staff trained on reliable, consistent processes in place is key.
• How do you communicate? Com-munication can be considered a core-framework component of the PCMH model. It is extremely important to have communication among practice staff, between care providers both in the practice and externally, with patients, and with other support services and other healthcare institutions. Consistent communication on essential patient information with key stakeholders in a timely and consistent manner is critical.
• Do you engage your patients? Engaging patients is not just a buzzword in a PCMH model; it is a crucial element. Identifying how to engage your patients and mechanisms that work for your particular patient base will be required.
• Is your practice accessible? Appoint-ment availability during office hours and the ability to reach a care provider during off hours is extremely important. Providing same-day appointments for patients who require them is a must-pass element in the NCQA’s criteria. You may want to start with reviewing your data, determining where you currently stand, and working on necessary improvements in access.

While it is important to note that implementing a medical-home model calls for attention to numerous requirements with a considerable level of detail, reflecting upon where your practice stands in relation to this high-level framework is a great first step in considering what elements you may already have in place and what elements may need to be implemented.


Kerry Ann Hayon is manager of the Mass. Medical Society’s (MMS) Physician Practice Resource Center. This article first appeared in Vital Signs, an MMS publication.

Change Agent

By
Banking and Financial Services Sections
Dena Hall Takes Regional President’s Role at United Bank

Dena HallDena Hall was talking about some of the many things that have changed since she was promoted to Western Mass. regional president at United Bank roughly a month ago.

She said her phone calls are being returned more frequently and more promptly now. Meanwhile, she’s taking more calls, including some from people who want to know if the attractive positions that once dominated her business card — senior vice president of marketing and community relations and president of the United Bank Charitable Foundation, are “up for grabs.” They are not — she’ll still have those duties.

She said she’s had more invitations for lunch — often to hear requests for monetary donations, from a board member from the bank, or both — and has accepted a good number of them, a slight departure from her previous practice, because she desired to be in the office as much as possible.

And her 6-year-old son isn’t shy about telling anyone and everyone that his mother is now president of the bank. “He leaves off the word ‘regional,’ and we just him let him run with that,’” she said with a laugh.

But mostly, Hall, now arguably the highest-ranking female bank executive in the Western Mass. region, is focused mostly on what hasn’t changed.

“A lot of what I’m doing in this new role I was doing before, between my role with the United Bank Charitable Foundation and being involved in the community, because … that’s who I am,” she told BusinessWest. “I’ve always been one of the faces of the bank, and I’ve always been interacting with the community, fielding customer complaints and compliments. It was happening before; it’s just happening more now.”

Indeed, Hall doesn’t expect much of a learning curve as she moves on with life as regional president. But there is a lot to do as she takes this lead role with what is being called the ‘new United Bank.’

That’s the marketing term that’s been used since a merger of equals between United and Glastonbury, Conn.-based Rockville Financial was announced several months ago, and especially since the union became official on May 1. As with any merger of this type, there is change, she noted, and helping customers and employees understand and cope with it has become a big part of her job description.

“There’s a huge change-management component to what we’re going through right now,” she told BusinessWest. “It’s hard to change, and people need some leadership through change, and that’s one of the things we’ve been doing all along, as a team, and myself in particular — guiding the people here through the change process that’s happening, because some things are different.”

Overall, the task at hand is taking two roughly $2.5 billion banks and shaping them into an efficient, competitive, growth-driven $5 billion bank, a number that means different things to different people, she acknowledged.

“A lot of people have said we’ve turned into a big bank because we have $5 billion in assets,” Hall noted, referring specifically to the many community banks populating Western Mass. and Northern and Central Conn. “But we’re still so tiny when compared to Bank of America or Santander or even TD Bank. Our value proposition is that we create a good alternative to those banks. We’re big enough to manage all the necessary regulatory burdens that are put on us as a bank, but small enough to deliver that really good customer service.”

The broad goal for all those at the merged bank is realization of what Hall called a “new normal,” something that won’t be achieved until probably early next year after the second of two data conversions, this one involving Rockville Bank customers, is complete.

For this issue and its focus on banking and financial services, BusinessWest spoke at length with Hall about her new — and continuing — responsibilities with the bank, and how this process of establishing a new normal will play itself out.

Balance Statement

“Day 61.” That’s how, after doing some quick math, Hall referred to July 1, the day she spoke with BusinessWest.

That means it was the 61st day since the merger between United and Rockville became official, or legal. There was a lengthy countdown before May 1, she noted, and the day counting has gone on since, at least internally.

“We counted down to legal day 1 — from the time this merger was announced until the day the companies came together, there was a countdown, like ‘what do we need to do to get to legal day 1?’” she explained. “Now that we’ve hit that, and there were struggles — everyone has struggles coming together — we’re still counting, saying ‘this is day 14’ or ‘this is day 30 — let’s figure out how, by day 40, we can be in a better spot.’”

It was day 31 when it was announced by the new bank that Jeff Sullivan, then serving as the combined entity’s president, was leaving to pursue “other opportunities.” In the same press release, it was announced that Hall, who joined United just nine years earlier, would add the title ‘regional president’ to those she already had, and that Michael Moriarty, previously senior vice president and team leader, would become executive vice president and Western Mass. commercial banking executive.

Hall told BusinessWest that a press release was being readied to announce that she would be assuming the roles of ‘executive vice president and chief marketing officer’ and ‘head of Community Strategy,’ but Sullivan’s decision brought about a quick change of plans — and titles.

She acknowledged that Sullivan’s departure just a month or so after the merger became official was “certainly not ideal,” because Sullivan was, in many respects, the face of the old United Bank, or what she called the “legacy United,” which he served as executive vice president and chief operating officer, and also because it undoubtedly raised eyebrows concerning how well the banks were coming together as one.

United Bank

Dena Hall says that creating a “new normal” at what is being called the new United Bank is at the top of her current to-do list.

But she noted that, in mergers of equals, there are often differences of opinion about how the combined institution is to be managed, and this was this case with Sullivan’s decision to move on.

“Our merger of equals is so much different than a traditional acquisition, because you’re bringing two companies, two cultures, two management teams, and, in our case, two boards together,” she explained. “And in theory, we were evaluating the practices that each one had and taking the best one.

“What we learned, and what we’re still learning, is that what worked for a $2.5 billion bank isn’t going to work for a $5 billion bank growing to $7 billion, $9 billion, or $10 billion, wherever we go down the road,” she continued. “We’re still working through all the pieces that are necessary to build this new company, because we’re really building a new bank; we’re keeping what was good about both companies, but we’re building something new.”

Sullivan’s departure did leave a critical void in the form of a strong local presence in a top leadership role, said Hall, adding that William Crawford IV, the CEO of the new United and Robert Stewart Jr., chairman of the bank’s board, recognized the need to fill it.

“They decided that local presence and geographic leadership is important,” she noted. “And it’s particularly important here in Springfield, because when you look at the legacy United, 70% of our business is here in Springfield, so if there’s a place where we need some strong geographic leadership, especially at a time when the banks are merging, it’s in Springfield.”

Hall and Moriarty, serving in their respective roles, fill the void left by Sullivan’s departure and provide that geographic leadership, she said, adding that the bank’s decision to place her in the regional president’s position sends a clear message  — actually, several of them.

For starters, it demonstrates that the bank is progressive — there are few women in top leadership positions at area banks, and none around Hall’s age — 40.

Also, the decision confirms the importance of this region to the merged bank moving forward.

“With mergers like this, jobs like this one often go out of the area,” she explained. “When there’s a merger, the geographic leader either comes in from the outside or the geographic leadership role goes away, and the president’s role goes somewhere else.

“The fact that our company has created this role, placed it in West Springfield, and given it to me speaks a lot for where the company is going,” she went on. “We’re both community banks with 120-plus years of history, but at the same time, we’re progressive, and we’re leaning toward maintaining our current customer base, but also attracting a younger customer base, going online, and going more mobile. Putting Mike and I in these roles when we’re both young and local makes a statement.”

Hall acknowledged that, traditionally, such positions within the banking industry have not gone to those from the marketing realm, but rather to commercial lenders. But the priority in all cases is to choose someone who knows the community and has created relationships within it.

“What banks are looking for in regional leaders now are people who are connected to the community — that’s the most important thing,” she noted. “Whenever you go through a merger, the automatic response is, ‘you’re leaving the community; you’re pulling out of the community.’ So regardless of the previous role, putting someone in this role who has a good connection in the community already is the driving factor behind making it successful.”

By All Accounts

It hasn’t rained much on Fridays in recent weeks, and that’s bad — in probably only one respect — because there’s a new policy in place at United’s regional operations facility in the center of West Springfield.

It’s called ‘rainy day Friday pizza,’ which pretty much says it all. If it rains on Friday — actually, even if it’s just cloudy and there’s a decent chance of rain — then Hall orders pizza for the entire building. OK, someone else does the ordering (probably 12 pizzas), and Hall pays the tab.

“This is something they do down in Glastonbury, and we thought it was kind of fun,” she told BusinessWest. “It’s only rained one Friday since we started it, but people really enjoy it. And it’s just one of the ways we’re trying to make sure that people feel valued in our new company and reaffirming to them that their role is still important even through perhaps their supervisor has changed or their job has changed.”

Implementing this new program — she’s also researching how to get a Ding Dong cart to stop by the headquarters building regularly — is clearly the least stressful of the myriad assignments facing Hall in her new role as regional president, and also with those other roles she still carries out.

Chief among them is leading the work to create that new normal she described, adding that this will be a work in progress as two bank cultures and two bank staffs are melded into one.

Hall has considerable experience with this, not only from when United acquired Worcester-based Commonwealth National Bank in 2009 and Enfield-based New England Bancshares in 2012, but also from when Woronoco Savings, which she served as assistant vice president and director of marketing, was acquired by Berkshire Bank a decade ago, a move that ultimately eliminated her job and prompted her to join United.

“I’m spending a lot of time helping people understand some of the things that are happening and why,” she told BusinessWest. “Communication is good at some levels and not so good at other levels, and decisions are made, and people may not understand why, and they instantly jump to the ‘blame the merger’ answer.

“It’s not usually ‘blame the merger,’” she went on, “but rather, ‘let’s look at the process and figure out what the best way is to accomplish what we need to accomplish, and if that means changing a process that we’ve had in place for a long time for the betterment of the organization, let’s have a conversation about it.’”

Creating greater efficiency is the ultimate goal with most of this change, she went on, adding that there have been some staffing reductions designed to eliminate redundancies across the board. And some operations have been moved, such as the loan center, which was relocated from West Springfield to South Windsor, Conn., and others that will be moved to West Springfield from Connecticut.

Beyond her work as change agent, Hall will play a key role in a rebranding initiative that will unfold in September. There will be a new logo and a new identity, she said, and not because of the merger, but because it was simply time for a new look.

“It’s time to give United Bank a facelift, and also position ourselves so that customers understand a little more about who we are, not necessarily here in Springfield, but in other areas,” she explained. “We have to make ourselves known in Connecticut. Because we just acquired New England Bank two years ago, no one really knows who we are; if you’re in one of the branch towns, like Cheshire or Southington, you know who United Bank is, but if you’re in West Hartford, you don’t know who United Bank or Rockville bank are.

“So we’re going to spend some time and money in Connecticut,” she went on, “making sure that everybody knows who United Bank is, what we do, what we offer, and why we’re a good alternative to the big banks.”

The new logo, which has been finalized but not unveiled, will be phased in, starting with the Rockville branches, which must become ‘United,’ by early October, said Hall, adding that there will be other changes, including new products, that are part and parcel of the process of becoming a new bank.

“We’re keeping some products and introducing new products, on both sides, so I’ll certainly have a number of conversations with people in the community and customers about the changes we’re making,” she said in conclusion. “And that’s OK. We need to have an open dialogue; I don’t every want someone to think they can’t walk in here and talk to any member of our staff about something that they’re feeling is not necessarily how they want it to be with their bank.”

Topping the List

As she talked with BusinessWest, Hall was getting ready to head out on a vacation for a few weeks. One of the things she did before leaving was make it clear who was responsible for ordering pizza if it rained on Friday.

That’s because continuing that new policy is one of the many components that go into the process of working through change and building a new bank.

In many respects, that process is just beginning, said Hall, noting while there will now be a number of titles crowding the business cards she’s awaiting, they can perhaps all be summed up with the phrase ‘change agent.’

It’s a role she’s excited about, and for all those reasons mentioned much earlier — from the phone calls being returned to her son getting some new bragging rights.

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

Sheriff Ashe Congratulated by Massachusetts Lawmakers

By
Daily News

WASHINGTON, D.C. — U.S. Sens. Edward Markey and Elizabeth Warren, U.S. Rep. Richard Neal, and Massachusetts Gov. Deval Patrick congratulated Hampden County Sheriff Michael Ashe Jr. for being honored this week at the White House as a “Champion of Change” for his exemplary work establishing a model continuum of supported community re-entry for offenders.

Ashe is chief administrator of the Hampden County Correctional Center, which supervises approximately 1,450 offenders in five levels of security — medium, minimum, pre-release, day reporting, and after-incarceration support. As part of his re-entry effort, Ashe has utilized some 300 community partnerships to help offenders find 523 jobs in 2013, and more than 10,000 jobs in the past 20 years, having an impact on recidivism and public safety.

The Champions of Change program was created as an opportunity for the White House to feature individuals doing extraordinary things to empower and inspire members of their communities. This spring, Markey and Neal nominated Ashe for the White House Champion of Change Award in the category of Expanding Reentry Employment Opportunities.

“Sheriff Ashe is one of the most passionate and innovative public officials in the country, and this recognition honors his nearly four decades of exemplary service to the people of Massachusetts,” said Markey. “He has led the charge in implementing rehabilitation and re-entry polities for incarcerated individuals that have become the model for facilities across the country. His motto as sheriff is ‘strength reinforced with decency; firmness dignified with fairness,’ and this recognition from the White House honors these ideals and his extraordinary record of achievement.”

Added Neal, “I was honored to nominate my great friend Mike Ashe for the Champions of Change Award. In my opinion, there is no one in law enforcement more deserving of this special recognition from the White House than Sheriff Ashe. It is a fitting tribute to a remarkable career in public service.”

Editorial

By
Opinion
A Critical Moment for Springfield

EditorialPenWSJIt was Friday the 13th when the Gaming Commission came to Springfield to commit the state’s first casino license to a developer, in this case MGM.

Maybe they should have waited for another day.

The action taken by the commission was not unexpected, and in many ways it was a formality — MGM’s proposal to build a resort casino in Springfield’s South End has been the lone surviving bid for this region for more than seven months now — but this should have been a celebration.

Indeed, a city that has been struggling for decades, with everything from high unemployment to tornadoes, from a fiscal mess to a moribund central business district, was on the cusp of a new and exciting era. MGM was going to spend $800 million, create 3,000 permanent jobs, and transform several blocks in the tornado-ravaged South End.

But it wasn’t really a celebration, and for good reason. The referendum question regarding the fate of casino gambling in the Commonwealth has been hanging over this process like a wet blanket for months now, taking much of the festive spirit out of that gathering in Springfield.

And now, as most everyone knows, that referendum question will appear on the November ballot, following a unanimous vote of the state Supreme Judicial Court on June 24.

The next four months or so will be a wild, frantic period in the Commonwealth. This will be an intense, very expensive campaign that both sides are firmly committed to winning. They will hold nothing back — nor should they, because the stakes are incredibly high.

And it is not hyperbole to say that nowhere are they higher than in the City of Homes.

It was nearly two years ago when MGM first began wowing Springfield and raising hopes that something remarkable could happen here. At a high-tech, Vegas-style unveiling of the company’s plans for the South End at the MassMutual Center, politicians, business people, and residents looked at the flashy pictures and videos and started to dream — big.

Over the next several months, more companies had similar shows, and eventually people began to think that this could really happen here. And as the events of last fall unfolded, when West Springfield and Palmer voters said ‘no’ to proposals for their communities, some people here actually started to see a casino as a sure thing.

They should have known better.

There are no sure bets in casinos, and there are certainly no sure bets in the Commonwealth of Massachusetts.

In fact, it’s fair to say that momentum for casinos is eroding in this state. Recent polls, including one conducted by the Boston Globe, say otherwise, but it’s easy to get the sense that it’s all slipping away. The Gaming Commission has looked inept at times, many times, and there were enough votes like the shocker in Palmer to make people wonder how wide and deep the support for casinos really is in this state.

There are enough question marks about all this to prompt conversations about what will happen in Springfield if the anti-casino forces prevail in November.

These are not uplifting conversations, to be sure. Indeed, the prevailing opinion is that it will be a blow that Springfield will take a long time to recover from — if it ever does.

That’s because the city is now this close to seeing its landscape transformed, its downtown property climb in value, its stock rise, its name become known for something other than poverty and blight. But it’s equally close to seeing it all go by the boards, leaving, as we’ve said on many occasions and in many ways, no Plan B, C, or D for how to spark a turnaround.

As we said, many individuals and communities have a lot at stake in November’s vote. But none more than Springfield. This is a critical moment for the city.

Opinion

By
Opinion
Early-childhood Education Is Important

By Steve Grande

There’s a perception that manufacturing is a dying industry in Western Mass., but the reality is quite different. In fact, a fundamental challenge faced by manufacturing companies in the region is finding enough qualified employees who can apply math, science, and critical thinking to do the technical jobs that are the backbone of manufacturing operations today.

The challenge is increased because the industrial workforce is aging, and there are not enough qualified younger workers to replace the older ones who will be retiring soon. Companies planning their long-term survival need new generations of skilled workers. My company, Meridian Industrial Group, is one of those companies.

Meridian has deep roots in Holyoke, where it was established in 1890 as The J&W Jolly Co. We manufacture large parts used in aerospace, defense, commercial, and medical applications for customers across the country as well as overseas. Our workers make this business possible, and from a practical standpoint, I know we need a pool of qualified candidates to perform skilled manufacturing jobs.

There are existing regional efforts that help supply the pool of workers to fill manufacturing jobs, but I have concluded that preparation must start sooner. Building the necessary skills — how to think clearly, focus attentively, and apply concepts of math and science to solve problems — has to begin early in life. When I say early, I mean years before a child enters kindergarten.

Companies like Meridian Industrial need people who are ready to learn, know how to learn, excel at learning, and enjoy learning, now more than ever. That’s why I decided last year that I would make a concerted effort to support the success of Square One. It intrigued me when I learned that Square One, which provides early education and care for mostly poor, inner-city children, was founded back in 1883 specifically to provide child care for young mothers so they could go to work and support themselves. Now, as then, the children see their parents going to their job each day, so work and self-reliance are considered the norm.

Children at Square One spend their day learning in a quality early-education and care environment that prepares them to enter school and be successful. Their lessons transfer directly to their experience in school and helps make children who went to preschool at Square One much more likely to graduate from high school, continue their education past that, and contribute productively to the community. Any business person can appreciate the long-term value of such an investment.

It also intrigued me that Square One was smart enough to figure out that you can’t just educate and inform a child; you have to educate and inform their family so the culture of personal responsibility for one’s own success is reinforced on a daily basis. It’s a ‘hand-up’ philosophy that makes sense on many levels.

So I decided to support Square One. Speaking practically, I understand that what I’m doing now to support the organization will impact my ability to be successful as a business owner over the long term. That’s why I call on my colleagues, customers, and community to get on board with Square One and the whole concept of early education and care. Take time to educate yourself about the impact of early education and care. Go visit a Square One preschool and meet the children. Stay for the morning and read them a story. Meet the teachers and the staff.

I don’t run a large foundation that can afford to give away millions of dollars. I run a manufacturing business that I want to be profitable for a long time. That’s why I am proud to be an ambassador who talks to others about the important work that Square One is doing.  Look into what Square One is doing because it matters, and support early-childhood education. v

Steve Grande is president of the Meridian Industrial Group, LLC.

Opinion

By
Opinion
Healthcare Stakeholders Support Reform

By LYNN NICHOLAS

An impressive collection of healthcare stakeholders have joined with the Mass. Hospital Assoc. (MHA) in calling for the state to support two extremely important reform efforts in the FY 2015 budget.

First, policymakers should address desperately needed behavioral-health reform measures. Five of Massachusetts’ largest care-provider organizations are jointly calling on the Legislature to support vital behavioral-health reform measures in next year’s budget. In addition to MHA, the Mass. Assoc. of Behavioral Health Systems, the Mass. Medical Society, the Mass. College of Emergency Physicians, and the Mass. Psychiatric Society are urging the adoption of both budgetary action and vital administrative steps needed to bolster timely access to behavioral-health services.

The Commonwealth’s behavioral-health system is broken, and immediate supports are needed to reinforce critical mental-health and substance-abuse services while we all work toward comprehensive, systemic reform. The multi-step plan advanced by our collective organizations calls for important investments in community-based placement services, outpatient and community-based diversionary services, and inpatient hospital-level services. It also urges the Legislature to adopt operational reforms that advance patient access to appropriate services on a timely basis and reduce emergency-department delays.

The persistent call for comprehensive reform of the Commonwealth’s behavioral-health system is gaining traction throughout the state. While thorough and systemic reform may take some time, it’s essential that policymakers move forward on some immediate interim steps that will preserve access and advance true parity for behavioral-health coverage and services. We hope this growing call from healthcare, public advocacy, and civic leaders will result in meaningful improvements for all patients in the very near future.

Second, new federal healthcare funding should be dedicated to its intended purpose — to support both low-income health-coverage programs and those who provide the care.

Hospitals, home-care providers, physicians, community health centers, advocates for patients, and organizations devoted to fighting major diseases are all calling on the state to ensure that the use of federal healthcare funding coming to Massachusetts through the Affordable Care Act is set aside to support the funding of Medicaid and other low-income healthcare programs in a transparent manner. Gov. Deval Patrick’s budget created the Health Insurance Expansion Fund to house the enhanced federal Medicaid revenues the state receives and dedicate the funding to support the financing of health-insurance coverage for low-income Massachusetts residents.

This approach is supported by the MHA, Health Care For All, Health Law Advocates, the Home Care Alliance of Massachusetts, the Mass. League of Community Health Centers, the Mass. Assoc. of Behavioral Health Systems, the Mass. Law Reform Institute, the American Heart Assoc. and American Stroke Assoc., the Mass. Medical Society, the Mass. Health Council, the American Cancer Society Cancer Action Network, and the Conference of Boston Teaching Hospitals.

This coalition has urged the Legislature to carry the governor’s recommendation forward while adding language that increases transparency — so that the amount of revenues in the fund, as well as expected additions and expenditures, are reported regularly — and explicitly authorizes one of the uses for the funding to be to support those who provide care to Medicaid patients.

This federal money was intended to shore up and support the important healthcare programs that have been developed under the state’s reform effort. By connecting the funding directly to these programs, the Legislature can create true transparency and accountability and help preserve the many collective successes we have achieved since the passage of the first health-reform efforts back in 2006.


Lynn Nicholas is president and CEO of the Mass. Hospital Assoc.

Opinion

By
Opinion
A Housing Shift Our State Must Adopt

By PAUL McMORROW

The number of Americans who own their own homes fell again last week. This is barely even news anymore. The Census Bureau updates its count of homeowners and renters in America every three months, and with each update for the past decade, the tally of homeowners has slipped a bit more. Homeownership rates haven’t been as low as they are now since 1995.

The fall is more than a long hangover from the burst housing bubble. American homeownership has been slipping so steadily for so long that the massive scope of the decline has obscured its real meaning. It isn’t really a story about Americans drifting away from homeownership en masse, so much as it’s a story about a fundamental shift in where, and how, young Americans live.

Cities and towns in Massachusetts that want to survive need to recognize, and embrace, this shift. The easiest way to begin is to stop building single-family homes.

Home ownership in the U.S. peaked in mid-2004, at 69%. And while ownership rates have fallen across the board, the decline is especially pronounced among young Americans. Since 2004, home ownership among adults under age 35 has fallen one-and-a-half times as much as the national rate has fallen. The decline among 30- to 34-year-olds is more than double the national average; the ownership rate among this age group is now as low as it’s been since at least the early 1980s.

Since young Americans are waiting longer than ever to take on a mortgage, the shift has enormous consequences for the way cities and towns grow. It means, on the most basic level, that they have to build more of the type of housing that folks are demanding — apartments — and less of the homes they don’t want or can’t afford in this still-sluggish job market. In Massachusetts, that means convincing local governments to change the way they’ve always approached growth.

There is no real state housing policy in Massachusetts. Municipalities control their own development. The state can only overrule local officials and force development on municipalities in very limited, painful circumstances. For the most part, the state’s housing policy is whatever common elements emerge from 351 separate land-use regimes. These different agendas usually add up to Massachusetts doing the exact opposite of what it needs to do in the housing arena.

Over the past two decades, Massachusetts has added new housing at roughly half the national rate. And when the state has added housing, it has added the wrong kind of housing; most has come in the form of single-family homes. And the state has already built most of the single-family homes it will need for a generation.

The sharp shift away from home ownership among the younger set means that, if Massachusetts is serious about attracting and retaining young workers, it can’t just continue churning out small quantities of large suburban homes.

A report earlier this year by the Metropolitan Area Planning Council found that Massachusetts needs to add hundreds of thousands of new housing units by the year 2040, but found the vast majority of development demand will fall on apartments and condominiums. This means Boston, Cambridge, and Somerville need to keep cranking away on their recent building sprees.

It also means that suburbs need to make their zoning priorities fit modern housing demands, and focus on building up rental units in denser town centers, where the housing demand is greatest.


Paul McMorrow is an associate editor at Commonwealth Magazine.

Opinion

By
Opinion
Rising Ocean Waters — and Rates

By JACK CLARKE

Bay State ocean waters and insurance rates are rising. Just ask those holding 25,000 federally subsidized coastal flood-insurance policies in Massachusetts. These contracts insulate people from the full risks of living on the shore — risks that private insurance companies have long refused to take, making taxpayers assume the burden.

Today, due to bigger and more frequent ocean storms, property loss has drowned the national program under $24 billion of debt. Much of this debt mounted after hurricanes Alex, Katrina, and Superstorm Sandy.

To ensure that future flood-insurance rates more accurately reflect the risks associated with living in hazardous coastal floodplains, in 2012, Congress experienced a rare moment of clarity and passed comprehensive flood-insurance reform.

When the new rate increases took effect, they sparked widespread panic, and Congress quickly backpedaled and then hit the snooze button on any serious rate reform. It seems that Congress is more than willing to step into the limelight to rebuild homes and businesses, but not to promote solutions that prevent or minimize property destruction in the first place. One thing is for certain — all this new attention to the risks of coastal living is a wake-up call, and we’d be wise to pay attention.

For those facing King Neptune’s inevitable onslaught of coastal destruction and havoc, options include moving buildings back from the shore, elevating structures on pilings, re-nourishing beaches with sediment to strengthen their natural storm-buffering capacity, and purchasing properties in harm’s way.

Evidence of completed federal coastal property-buyout programs from across the country shows that these investments pay for themselves within 10 years by permanently avoiding response, rescue, recovery, and repair costs from future floods. Most importantly, the lives of first responders and residents are spared.

Flooding causes almost half of all disaster-related property destruction in America — and it’s getting worse. A recent Federal Emergency Management Agency study found that sea-level rise will expand the nation’s flood-hazard areas by more than 50% by 2100, with the number of associated flood-insurance policies increasing by an astounding 130%. A growing coastal population exacerbates the problem. The U.S. Census Bureau reports that almost 40% of Americans now live in coastal counties. Here at home, according to the Massachusetts Coastal Zone Management Office, 85% of Massachusetts’ 6.7 million residents live within 50 miles of the coast.

A 2005 congressionally mandated study found that, for every $1 invested in hazard-mitigation activities, the national economy saves $4 in losses from future disasters, and saves an additional $3.65 in costs to the U.S. Treasury from avoided disaster-recovery expenditures and lost tax revenues. Last month, the New England Center for Investigative Reporting showed that, in this region, there are 534 properties considered ‘severe repetitive loss’ casualties — meaning that the flood insurance program has paid owners multiple times to repair and rebuild on site.

A bill championed by state Sen. Mark Pacheco, chair of the Joint Committee on Environment, Natural Resources, and Agriculture, includes coastal buyback simply because it is among the most cost-effective and pragmatic mitigation measures for addressing high-hazard coastal areas. The legislation proposes to fund the purchase, from willing sellers, of properties that are repeatedly and substantially damaged by storms. Specifically, a voluntary coastal buy-back program would:

• Invest in high-risk properties in advance of flood disasters;

• Clean up and restore properties to their natural conditions while conserving them for public benefits such as parklands, wildlife refuges, and public beaches;

• Provide storm buffers as repaired coastal resources absorb floodwaters and save uplands from flooding; and

• Capture and store heat-trapping carbon pollution within restored coastal ecosystems, mitigating some of the worst effects of climate change.

A coastal buy-back program would convert vulnerable and dangerous flood-prone properties from liabilities to valuable community assets while sparing lives, protecting the environment, and saving tax dollars.

The alternative is to continue pouring money into an undertow of debt.

Jack Clarke is director of public policy and government relations for Mass Audubon and a recent gubernatorial appointee to the Mass. Coastal Erosion Commission.

The Rules Have Changed

By
Law Sections
New Regulations Aim to Level Playing Field for Veterans, IWDs

John S. Gannon

John S. Gannon

Last year, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) announced new rules intended to promote the hiring and employment of veterans and individuals with disabilities by federal government contractors. OFCCP is responsible for ensuring that employers doing business with the federal government comply with laws and regulations requiring affirmative action and nondiscrimination.

Two laws the agency oversees are Section 503 of the Rehabilitation Act of 1973, which prohibits employment discrimination against individuals with disabilities, and the Vietnam Era Veterans Readjustment Assistance Act (VEVRAA), which requires federal contractors to take affirmative action to employ specified categories of veterans.

Background

The Department of Labor (DOL) has stated that the new rules “help level the playing field” for veterans and individuals with disabilities (IWDs).  According to fact sheets released by the DOL, the unemployment rate in 2012 for Gulf War II-era veterans — those who served in the Armed Forces sometime since September 2001 and have since returned to civilian life — was 9.9%, compared to 7.9% for non-veterans.

The disparity increased for males ages 18 to 24.  Similarly, IWDs had high rates of unemployment; the unemployment rate for working-age IWDs in 2012 was 15%, compared to 8.8% for individuals without disabilities. The poverty rate for IWDs, ages 18 to 64, was 28.8%, compared to 12.5% for non-disabled people. The new rules are aimed at addressing both of these target populations.

Major Provisions

The new rules impose significant new obligations for covered federal government contractors and subcontractors. First, the final VEVRAA rule requires contractors to establish annual hiring benchmarks for protected veterans, a group that includes Vietnam-era veterans, special disabled veterans, veterans separated from service for three years or less, and veterans who served on active duty during a war or in a campaign or expedition for which a campaign badge has been authorized.

Contractors can either use the national percentage of veterans in the civilian workforce as a benchmark (currently 8%), or develop their own custom benchmarks using criteria outlined by OFCCP. Although progress toward the benchmark needs to be tracked, failure to meet the benchmark alone will not carry a penalty. A violation could result, however, from failure to establish a benchmark and collect corresponding data.

The final Section 503 rule contains a similar provision that establishes a 7% workforce utilization goal for employment of IWDs. The 7% goal applies to employees in each job group, unless the total workforce is under 100 employees.  Employers of fewer than 100 may apply the 7% IWD goal to the entire workforce.

Again, OFCCP states that failing to meet the IWD utilization goal alone will not constitute a violation of the regulation and won’t lead to a fine or penalty.  However, it may lead to an audit by OFCCP. Following an audit, OFCCP may request that the contractors enter into conciliation agreements with remedial benchmarks for hiring IWDs.

Self-identification

Both final rules require contractors to invite applicants to self-identify as a veteran or IWD during the application process. In addition, covered contractors must ask employees to voluntarily self-identify IWD status during the first year following the implementation of the new regulations and every five years thereafter. OFCCP has released a Section 503 self-identification form that contractors are required to use, which can be found at www.dol.gov/ofccp/regs/compliance/sec503/voluntary_self-identification_of_disability_cc-305_sd_edit1.24.14.pdf.

The agency has not released a similar VEVRAA form, but sample invitations to self-identify can be found in the new regulations. Contact employment counsel for guidance on creating this form.

Employers who are up to speed on their Americans with Disabilities Act (ADA) obligations might be concerned with the new Section 503 self-identification process. The ADA generally prohibits employers from asking applicants and employees to provide information concerning their physical and/or mental condition. However, the Equal Employment Opportunity Commission issued an opinion letter last year supporting OFCCP’s new self-identification requirements.  Therefore, covered contractors do not need to worry about ADA obligations when issuing Section 503 self-identification forms to applicants and employees.

Data Collection

The new regulations require contractors to document and annually update several quantitative comparisons for the number of veterans and IWDs who apply for jobs and are hired. This includes information about the number of veterans and IWDs who applied, the total number of applicants and the total number hired, and the total number of openings filled.


Who Must Comply?

The new VEVRAA rule impacts all employers who have federal contracts or subcontracts of $100,000 or more. Section 503 rules apply to employers with federal contracts or subcontracts of $10,000 or more.

Timing

The effective date for the new regulations was March 24, 2014. However, contractors with affirmative-action plans (AAPs) already in place on March 24 can keep them in place until the end of their current AAP year and defer compliance until their new AAP plan year.

Bottom Line

Federal contractors need to make sure their hiring and employment practices comply with the new rules. Additionally, AAPs need to be modified for compliance. Contact experienced counsel for assistance updating your AAPs or general information about the new OFCCP rules. n

John Gannon is an attorney at the management-side labor and employment firm Skoler, Abbott & Presser, P.C.; (413) 737-4753; [email protected]

Opinion

By
Opinion
Early Education: a Worthy Investment

By JOAN KAGAN

The Benjamin Franklin adage that “an ounce of prevention is worth a pound of cure” is as true today as it was when Franklin authored it in 1736. Pay attention early, and you prevent costly problems later — a simple concept that is demonstrated in high-quality early-education programs, such as Square One, in which the cognitive, social, emotional, health, and nutrition needs of children and families are addressed through research-based curriculums and activities.

Each April, the National Assoc. for the Education of Young Children shines a national spotlight on the needs of young children and their families while focusing the public’s attention on programs that meet those needs. The Week of the Young Child, celebrated this year April 6-12, is an opportunity for us to stop and support these meaningful contributions and the impact those contributions have in improving the lives of children and their families.

Children with a high-quality early-childhood program get better grades, are more educated, are 40% more likely to graduate from high school, and become better employees and better citizens.  When James Heckman, a Nobel Laureate in Economics, was asked how best to positively impact our economy, he responded, “high-quality early-childhood programs.”  Heckman and other economists report that the return on dollars invested in quality early-education programming varies from 7% to 16%. The savings are recognized in a reduction in crime, substance abuse, teenage pregnancy, special education, and welfare dependency.

Yet, the challenge of funding high-quality early education for all children is daunting. The majority of funding is federal, and eligibility is based on the economic and work status of the family. The cost of providing the service far exceeds the rate of reimbursement from state contracts.

Many private early-education and care providers are no longer accepting or are reducing serving the number of children with subsidies because of the low rates of reimbursement, thus reducing access to services. Unfortunately, many of our community’s  poorest children, who are at highest risk for school failure, are not eligible for subsidized early education, thus perpetuating the cycle of poverty and unemployment.

In his State of the Union address, President Obama affirmed that the job of equipping our citizens with the skills and training necessary to grow our economy has to start at the earliest possible age. And recently, Gov. Deval Patrick announced his heightened focus on early education in Massachusetts.

Both leaders know that early education is a wise investment that will pay for itself many times over, and will benefit everyone. Businesses will benefit from an educated workforce. Communities will benefit from reductions in violent crime. Schools will benefit from students who are not simply ready to enter school, but who are prepared to excel in school and who are reading proficiently by the end of third grade — a key indicator of a child’s future success in school.

Early education is irrefutably an ounce of prevention that is worth, for us all, a pound of cure.

The Week of the Young Child provides a special opportunity to support early-education and care programs. Join us during this special week to celebrate the good works happening every day by pledging your commitment to the highest-risk children and families who need a chance to learn and grow together.

Contribute your time or talent. Come and visit, and share a special skill with our children and families. Coming in and reading for even an hour shows our children just how much our community cares for and about them. Take this week to demonstrate your support for our year-round work.

Joan Kagan is president of Springfield-based Square One; (413) 732-5183.