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CNYBJ.COM

New SRC CEO talks about the company’s future

$2.00

New loan program to launch on Near Westside

BY KEVIN TAMPONE BY KEVIN TAMPONE

JOURNAL STAFF

JOURNAL STAFF

CICERO — It’s not recruiting talented new employees or grappling with the challenges of a smaller budget at the Pentagon that really keep SRC’s new CEO up at night. “The biggest thing I worry about is losing our edge,” says Robert Behler, who took over as SRC, Inc.’s CEO on Dec. 1. “The threat to me is always having another company come up with better technology that displaces what we’re doing. We’re always careful about that.” Deflecting that threat is just one of the many challenges Behler will face at the helm of the Cicero–based nonprofit research and development company. SRC and its for-profit manufactur-

PHOTO COURTESY OF SRC

Robert Behler, new CEO of SRC, Inc. in his office. Behler started in his position on Dec. 1.

See SRC, page 15

SYRACUSE — The Near Westside Initiative is launching a micro-lending program for entrepreneurs and existing businesses in the city’s Near Westside neighborhood. A $25,000 grant from the Central New York Community Foundation will be used to create a loan-loss reserve at Cooperative Federal Credit Union of Syracuse. That will allow a total loan pool of $100,000. The Near Westside Initiative is a nonprofit group aimed at redeveloping the neighborhood near the western edge of downtown Syracuse. The effort includes projects ranging from housing redevelopment based on sustainable building practices to programs encouraging artists to settle See WESTSIDE, page 4

Canadian entrepreneur gets back in the game with DeWitt business acquisition BY ERIC REINHARDT JOURNAL STAFF

DeWITT — Retirement life in Florida just wasn’t a good fit for Canada native Mark Watson. Watson had owned Century Tools & Machinery Ltd. in Mississauga, Ont.

(near Toronto) for nearly 30 years before deciding to sell the business to his children in October 2008. Century Tools is a distributor of tooling components, drill-jig bushings, and toggle clamps, according to its website. After selling the business, Watson and his wife, Caroline, had relocated to

their Florida home. Three months and many rounds of golf later, Mark Watson had developed the itch to return to the business world. Watson admits that, when he wasn’t golfing, “I was really, really bored.” See HARRISON, page 9

PHOTO COURTESY OF ALICIA RADICCHI

Left to Right: Caroline Szozda-McGowan, owner of Szozda Gallery; Whitney Daniels, owner of wrkdesigns; and Michael Short, Near Westside Initiative (NWSI) deputy director and interim chair of the NWS Business Association.

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• The Central New York Business Journal

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February 11, 2011

The Bonadio Group overhauls management structure with eye toward future growth

News of note for and about Central New York businesses

Dental practice buys vacant lot for parking SYRACUSE — Martin McDermott, senior vice president, and Paul Myles, sales and leasing agent at JF Real Estate, recently brokered the sale of vacant commercial property at 1425 Butternut St. McDermott represented Dr. Michael Darling, the buyer, and Myles represented James Giaquint and Geraldine Grady, the sellers, in this transaction. Financial details were not provided. In an earlier collaboration, Myles and McDermott worked with Darling to purchase the adjacent building on Butternut Circle. Darling has renovated the property for his new dental practice, and this most recent acquisition will serve as the parking lot for the dental office.

Creekside Counseling opens office in North Syracuse OSWEGO — CreekSide Counseling Services (CCS), an agency serving adolescents, aged 13 and up, and adults in Oswego County and northern Onondaga County, has opened its second office at 428 S. Main St., Suite 111, in North Syracuse, Owner Jody Fiorini, Ph.D. announced the new North Syracuse office in a recent news release. The Oswego office is located at 335 W. 1st St. (Time Warner Bldg.). CCS is open evenings and weekends by appointment, and accepts many insurance plans. Fiorini is a licensed mental-health counselor and a national certified counselor. She is also a professor at SUNY Oswego in counseling and psychological services. Contact CCS at (315) 343-3344 or e-mail: info@creeksidecounselingservices.com.

BY KEVIN TAMPONE JOURNAL STAFF

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he Bonadio Group is making some changes to its management structure that firm leaders say will help it keep pace with recent growth and push for more expansion in the future. A management committee will oversee day-to-day operations at the firm, which provides accounting, business advisory, and financial services. Bonadio, based in Rochester, has offices in Buffalo, Albany, Geneva, Perry, and Syracuse, where it has about 30 employees. Firmwide, Bonadio has more than 350 employees and 42 partners. Previously, the firm’s founder, Thomas Bonadio, was responsible for daily management. The new committee includes Bonadio, the firm’s managing partner and CEO, and two other partners, Bruce Zicari and Mario Urso. The Bonadio Group announced the change Feb. 4. The firm’s other executives, including its chief operating officer and CFO, report to the management committee. The accounting firm had simply gotten too large for a single person to manage, Bonadio says. “This allows us to move more quickly,” he says. “It spreads some of the responsibilities around so no one person is the only

Bonadio

Urso

person that knows what’s going on.” The committee approach will give Bonadio time to sell the firm and bring in new business, he says. It also creates a bench and a strong leadership team for the future, even though Bonadio says he’s not leaving the firm anytime soon. And, the structure will make it easier to act more swiftly on acquisitions in the future, something the firm is always exploring, Bonadio says. The management committee will report to a board of directors elected by the firm. Six Bonadio partners and the three members of the management committee will sit on the board and meet quarterly. The group will be involved in strategic planning and implementation. The firm explored using a board of external directors, but wanted all partners to have some say in how the business is run, Bonadio says. “They have a voice just like you do in Congress,” he says. “Every partner gets the chance to be on the board or vote for who

CenterState Business Showcase

the board members are.” The Bonadio Group first entered the Syracuse market in 2007 when it acquired Loguidice & Kamide, CPAs PLLC. At the time, that firm employed 12 people. More growth is on the Zicari horizon for The Bonadio Group in Syracuse and statewide, Bonadio says. The goal is for the firm to increase its annual revenue from $44 million to $60 million in the next three years. And in the next two years, the accounting firm expects to double its size in Syracuse. “No one person can really run this operation,” says Thomas Kamide, a partner in the Syracuse office. “We want to make decisions quickly. They all know the firm and they know how it works. They know this place inside and out. “We’re doing this because we want to be able to accommodate what our future growth is going to be.” The firm is currently looking for new space in the Syracuse area and expects to move this fall. A handful of sites are under consideration in the city and the suburbs, Bonadio Group leaders say.  Contact Tampone at ktampone@cnybj.com

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Correction The article entitled “Nonprofit healthplanning groups to combine efforts” in the Feb. 4, 2011 issue of The Central New York Business Journal contained an error. Eric Hunt, vice president and chief information officer at Welch Allyn in Skaneateles Falls, is the current chairman of the Health Advancement Collaborative of Central New York (HACCNY) board of directors.

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The Central New York Business Journal • 3

February 11, 2011

Poll: Upstate, Syracuse CEOs most optimistic since 2007 BY ERIC REINHARDT JOURNAL STAFF

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pstate New York business leaders are more optimistic about business conditions for their own industries and the state’s overall economy in 2011 than at any time in the last four years. That’s according to the fourth annual Survey of Upstate New York Business Leaders released Feb. 9. First Niagara Bank, a unit of Buffalo–based First Niagara Financial Group, Inc. (NASDAQ: FNFG), commissioned the survey, which the Siena (College) Research Institute (SRI) conducted. The survey “gives us a rare look at how leaders of private businesses across upstate New York … view current and future economic conditions, as well as their predictions for their own business operations for 2011,” said George Evans, First Niagara research analyst, during his remarks in a webcast from WNED-TV in Buffalo. SRI interviewed a total of 645 CEOs, CFOs, and other senior managers of private, for-profit businesses, generating annual sales between $5 million and $150 million, in the Syracuse, Albany, Rochester, and Buffalo areas during the fourth quarter of 2010. The survey sample included 121 business executives from the Syracuse area, according to First Niagara. Industries represented included manufacturing, service, engineering and construction, wholesale and distribution, retail,

Index of Upstate New York Business Leaders 120

2010

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93.8

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financial, and food and beverage. The overall-confidence index of upstate business leaders was 98.4 on a scale of 0 to 200, with 0 as the most pessimistic and 200 as the most optimistic. The 98.4 index reading was 12 points higher than the reading for 2010 and 59.4 points higher than the one registered for 2009. The confidence index measures the current assessment and future expectations for the statewide economy and for leaders’

Future

Current

specific industries. An index reading of 100 would have an equal number of negative and positive responses. For the first time in the First Niagara survey’s history, an index reading registered higher than 100, yielding more positive responses than negative. Business leaders’ expectations for the coming year resulted in a future-confidence index of 103.1, an See POLL, page 11

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• The Central New York Business Journal

February 11, 2011

westside: Last year, Initiative began launching a number of projects to foster business growth Continued from page 1

in the neighborhood. Partners in the initiative include Syracuse University (SU) and Home HeadQuarters, Inc., a housing nonprofit. Last year, the Near Westside Initiative began launching a number of projects designed to foster business growth in the neighborhood, including a business association and training and mentoring programs. The micro-lending program is the latest piece in the puzzle. All of the entrepreneurship projects undertaken in the neighborhood have been based on a 2009 survey and analysis of all businesses in the area. That survey found 35 percent of the neighborhood’s businesses were interested in expanding, but lacked the resources to do so, says Michael Short, Near Westside Initiative deputy director and chairman of its Small Business Development Committee. The loan program is aimed at existing companies and entrepreneurs interested in launching new ventures. Applicants must have a business plan and participate in the Near Westside Business Association. The idea is to encourage a community of entrepreneurs in the neighborhood and ensure they have the skills to run their companies successfully, Short says. “This will provide people who wouldn’t be able to get loans otherwise the opportunity to invest in their ideas and expand,” he says. The goal is for the program to create 10 new jobs and five new businesses in the

photo courtesy of Alicia Radicchi

From left to right: Whitney Daniels, owner of wrkdesigns; Michael Short, Near Westside Initiative (NWSI) deputy director and interim chair of the NWS Business Association; Anup Bhatt, owner of Pat’s Safeway Dry Cleaning; and Bill Delavan, owner of Delavan Center, discuss the new program at a NWS Business Association meeting. next two years. A number of companies and entrepreneurs are currently participating in the Near Westside Initiative’s training sessions and once they finish their business plans, they’ll most likely apply for loans, Short says. Budding entrepreneurs often don’t have the money to invest in their ideas themselves, he adds. Many turn to credit cards or other less-than-ideal methods of funding a company. “These are smaller businesses with smaller capital needs,” says Ron Ehrenreich,

treasurer and CEO of Cooperative Federal. “They’re basically bootstrapping.” The loans involved in the program will range from $2,500 to $20,000 each. The average size will be around $10,000. But sometimes, that’s it all takes for a young company to gain a foothold, Ehrenreich says. The loans will also allow new businesses to test themselves and their plans without their owners risking financial ruin. “This gives them an opportunity to succeed,” he says. “That’s really the most important thing.”

In addition to the Near Westside Initiative’s training, Cooperative Federal also works with its clients on developing their skills, especially when it comes to financial and credit matters. The owner of a new company may know how to do their work, but running a business takes a completely different skill set, Ehrenreich says. For more information, on the loan program, contact Short at (315) 308-0543 or e-mail: mwshort@syr.edu. q Contact Tampone at ktampone@cnybj.com

B S & K Announcement Danielle M. McCann Has Been Elected A Member Of The Firm

Karen Veronica DeFio Has Been Named Senior Counsel To The Firm

DANIELLE M. McCANN is a graduate of the College of the Holy Cross (B.A., 1998) and Syracuse University College of Law (J.D., cum laude, 2001), where she served as Business Editor of the Syracuse Law Review (2000-2001). Ms. McCann is a member of the Justinian Honorary Law Society.

KAREN VERONICA DeFIO is a graduate of the State University of New York at New Paltz (B.A. 1994) and Albany Law School of Union University (J.D., cum laude, 1998).

Ms. McCann concentrates her practice in Business Law and advises publicly-traded and private companies on a variety of corporate and commercial law matters, including mergers, acquisitions and securities. Ms. McCann is the recipient of the Women’s Bar Association of the State of New York Doris S. Hoffman Outstanding New Lawyer Award and the 2010 40 Under Forty Award and the 2008 Women in Business Award sponsored by the Central New York Business Journal. She is a member of the Board of Directors of the American Red Cross of Central New York and the Onondaga County Bar Association. Ms. McCann also served as the President of the Central New York Women’s Bar Association. One Lincoln Center, Syracuse, NY 13202-1355 315-218-8000  www.bsk.com

Ms. DeFio concentrates her practice in the areas of general business law and higher education law. Areas of expertise in general business law include commercial bankruptcy and reorganization, creditors’ rights, workouts, preference litigation, secured transactions and contract law. In addition to being a member of the Firm’s Business Restructuring, Creditors’ Rights and Bankruptcy Practice Group, she has lectured in the areas of bankruptcy and secured transactions. Ms. DeFio is also a member of the Firm’s Higher Education Practice Group and provides general legal counsel to colleges and universities on a wide variety of topics including public safety issues, record retention and confidentiality, academic and disciplinary matters, contracts, employment agreements and licenses. She also lectures on higher education issues.

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The Central New York Business Journal • 5

February 11, 2011

New research from EBRI shows HSA/HRA growth By Journal Staff

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among individuals generating less than $50,000 in household income; $1,303 among individuals with $50,000−$99,999; and $1,742 among individuals with $100,000 or more.  Account balances increased for those with less than $50,000 in household income; fell for those with $50,000−$99,999; and stayed the same for those with $100,000 or more.  • Education: Education has an impact on account balances, independent of in income and otherT:7.5 variables.  Individuals

with a high-school degree or less education have an average of $1,219 in their account, while those with a college degree have $1,519, and those with a graduate degree hold $1,558.  Only individuals with a graduate degree experienced a decline in their average account balance in 2010.  EBRI is a private, nonprofit research institute based in Washington, D.C., that focuses on health, retirement, and economicsecurity issues. EBRI says it does not lobby and does not take policy positions. q

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  he number of health-savings   accounts (HSAs) and health-reim  bursement arrangements (HRAs) increased to 5.7 million in 2010, according to a recent report by the nonpartisan Employee Benefit Research Institute (EBRI). Assets in these account-based health plans increased to $7.7 billion in 2010. HSAs and HRAs can be used to reimburse participants for qualified medical expenses. They are offered by some employers in order to give their workers more control over funds allocated for health-care services, EBRI says. Growth in these accounts was tracked by the EBRI/MGA 2010 Consumer Engagement in Health Care Survey, which also examined numerous other aspects about health-care consumers who use these plans, in comparison with traditional health plans. The findings are published in the January 2011 EBRI Issue Brief, “Health Savings Accounts and Health Reimbursement Arrangements: Assets, Account Balances, and Rollovers, 2006– 2010,” online at www.ebri.org. Among other findings, the EBRI/MGA survey found no relationship between either account balance or rollover amounts and various cost-conscious behaviors such as checking prices before getting services, or asking for generic drugs instead of brand names, among other things.  “It is expected that individuals who are given more control over funds allocated for health-care services will become more cost conscious, especially once they become more educated about the actual price of health services,” said Paul Fronstin, director of EBRI’s Health Research and Education Program and author of the report. “However, no evidence was found to support this with respect to some of the measures used in this study of cost-conscious behavior.”

slightly to 13 percent in 2010.  • Race: Minorities with HRAs or HSAs have higher account balances than whites with these accounts.  On average, minorities have an account balance of $1,531, while whites have an account balance of $1,387. Both experienced a decline between 2009 and 2010; however, the decline was larger among minorities. • Household income: Account balances increased with household income.  The average account balance was $1,166


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• The Central New York Business Journal

February 11, 2011

Former Bay Ridge Group begins life as United Advisors By Traci DeLore Journal Staff

ENDWELL — The Bay Ridge Group, a Southern Tier–based provider of employee-benefits and retirement plans, is now known as United Advisors, LLC following the acquisition of a North Carolina company last year. The acquisition of United Advisors of Wilmington, N.C. in September was the culmination of a process that began more than six years ago when management at Bay Ridge began looking at opportunities to grow the business, says Thomas Surowka, chief marketing officer at the new United Advisors (www.united-advisors.com). “We’ve been very pleased with how we’ve grown … but we also recognized we needed to put together a plan to diversify,” he says. They talked at the time with P. Cosmo Smith, who owned United Advisors, about a plan he had to assemble a group of small but successful companies into one larger conglomerate that could meet the needs of its combined customer base. “The idea was to combine scale and expertise,” Surowka says. The idea was a good one, but the timing just wasn’t right nor was there enough infrastructure in place to support such a group, he says. Bay Ridge moved on, and was eventually acquired by National Financial Partners (NFP) in 2007. Bay Ridge continued to operate as an independent enterprise under the NFP group,

which gave it access to the expertise and products of 150 firms nationwide. Partnering with NFP provided a key piece of the puzzle when it came to growth at Bay Ridge, Surowka says. It gave Bay Ridge acquisition capital, and also allowed the company to continue to build allegiances with other firms, he says. It also put in place the infrastructure — marketing, networking, and support — to make acquisitions possible, and Bay Ridge followed through with the purchase of Smith’s business on Sept. 1, Surowka says. He declined to disclose terms of the sale or the company’s current number of clients or revenue. The acquisition follows the company’s plans to diversify geographically, and the name change reflects the company’s aspirations to become a nationwide provider, he says. “We believe it carries more of a national recognition,” he says of the new United Advisors name. Surowka stresses that the company remains headquartered in Endwell and has no plans to change that. “We’re staying in Broome County.” In Central New York, the firm has an office at 2 Ascott Place in Ithaca, another location in Norwich, and it previously had an office on Erie Boulevard in Syracuse until about a year ago. Surowka declined to say why that office, which administered and kept records for retirement-plan clients, closed, but says the company still maintains its clients in the Syracuse area. United

Advisors also works with between 200 and 300 clients in the Utica to Watertown region. United Advisors has marketing agreements with the Cortland County Chamber of Commerce, the Watkins Glen Area Chamber of Commerce, the Chemung County Chamber of Commerce, and the Sixth District Dental Society. United Advisors also maintains a referral arrangement with the Tompkins County Chamber of Commerce. In addition to its upstate New York reach, United Advisors has a presence in North Carolina, where Smith’s company was based, as well as San Francisco, where Smith had another office, he says. Having a wider geographical spread helps United Advisors keep up with serving its existing clients, who have also grown geographically, he adds. While there has been plenty of crossselling of products between former Bay Ridge clients and Smith’s former clients, the real growth opportunity comes from the combined force of the two companies, Surowka says. “It’s kind of wrapping together all the different marketing arrangements, sales and distribution arrangements we’ve been working on,” he says of the acquisition. The result is a company that specializes in ideas and solutions for its clients. “We help businesses run their business,” he says. It’s important that United Advisors has the expertise, he says, because at many

companies (their average client has between five and 500 employees) most employees wear multiple hats and don’t have time to fully research all the issues when it comes to health-care options or retirement plans. That’s where United Advisors helps them. Smith, as chairman, is the “deal maker,” while Bay Ridge’s Robert Sedor, Jr., as president and CEO, brings the entrepreneurial skills to make the ideas a reality, Surowka says. Surowka, chief marketing officer, is the “sales guy” and David Nowacoski, the company’s COO, is the “operations guy,” he adds. United Advisors relies on the network of companies it partners with under NFP to provide any products it doesn’t, he adds. Surowka says the acquisition is hopefully the first of several that will give United Advisors a strong national presence. “We still have a number of other things in the pipeline we’re hoping to accomplish,” he says. He declined to release any specific details. Headquartered at 1405 Davis Ave. in Endwell, United Advisors employs about 85 people total including 50 new employees that came with the acquisition. There are 28 employees in the 10,000-square-foot home office, about seven in Wilmington, four in San Francisco, with the rest spread out across the company’s other locations, which include an office in Norwich and one in Ithaca. q Contact DeLore at tgregory@cnybj.com

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The Central New York Business Journal • 7

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• The Central New York Business Journal

February 11, 2011

When the Boomers Retire, Will You Sink or Swim? You don’t drown by falling in the water. You drown by staying there. — Unknown View life as a continuous learning experience. — Denis Waitley

F

  or the last several months, I’ve been   talking about the tidal wave head  ing toward the shores of American business. The Baby Boomer generation is reaching retirement age and more than 20 million workers — including the executive-management team in many businesses — will retire in the next eight to 10 years. In order to survive, organizations must be prepared for the inevitable leadership transitions ahead. My previous two columns covered pretransition planning and how to ensure a successful transition for new leaders. I’ll wrap up the series with tips on ensuring long-term success for your new managers. As many as 25 percent of new managers fail during the critical first 12 to 18 months on the job and it’s essential to help them navigate through this transition period. However, many organizations make the mistake of thinking the job is done when the initial transition has been completed. There are several reasons why new managers need long-term mentoring and development. • Every new manager comes into the job

with gaps in his/her skills and capabilities. No matter how strong the candidate, no matter how effective your management-development program, every new leader has weaknesses that must be overcome. It may take more than 18 months to complete these deCLOSELY HELD velopment steps. • Continuous feedBusiness back helps accelerate the learning curve. New managers who have ongoing access to a mentor, who can reinforce areas of strength and coach them in areas of weakness, will become more productive more quickly. • New managers will gain a more seasoned perspective on their job over time. As new managers become more familiar with their management peers, their subordinates, and their responsibilities, new questions and concerns will arise. Without ongoing mentoring, new managers may begin to feel isolated and lose confidence in their management abilities. • New leaders need objective input on their progress. Most new managers can pinpoint a few areas where they’re feeling

THOMAS WALSH

very confident or where they know they need help. However, no one can objectively assess his/her own total performance. • Constant change is the new norm. Even managers who have been well prepared to handle today’s challenges will need ongoing development to handle the difficulties of next month and next year. Simply put, the skills that enabled the manager to get the promotion are not enough to maintain a high level of productivity over the long term. • It’s lonely at the top. All managers, even those who’ve been in leadership positions for many years, need someone with whom they can brainstorm solutions to challenges, kick around ideas, and commiserate when the going gets tough. Ongoing mentoring and coaching keeps managers fresh and helps to increase innovation and productivity.

An example

One of our clients, having identified a pool of seven “high potentials,” has initiated a development program for them that includes ongoing individual coaching as well as team coaching and training. The focus over the first year is learning about themselves as leaders — their core values and strengths and weaknesses that can impact their effectiveness. In addition, they will be taking on planning roles for aspects

of the company that will teach them how to think more clearly about the business and allow senior managers to participate with them in strategic and tactical conversations. In short, we are developing this team systematically to be the senior leaders of the company in the future, allowing for business continuity and long-term success.

The bottom line

Organizations that want great leaders know that management is a never-ending journey. They implement managementdevelopment programs to create a pool of strong candidates ready to move into leadership roles when needed. They support new managers through the critical first 18 months on the job. They complete the cycle with ongoing coaching, mentoring, and development programs to help their managers continually build new skills and maximize their capabilities. When the tidal wave of Baby Boomer retirement hits their shores, these organizations will not just survive; they will be ready to move ahead of their unprepared competitors. q Thomas Walsh, Ph.D. is president of Grenell Consulting Group, a regional firm specializing in maximizing the performance of organizations and their key contributors. E-mail Walsh at tcwalshphd@grenell.com

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The Central New York Business Journal • 9

February 11, 2011

HARRISON: Firm distributes more than 300 product lines to customers across New York State Continued from page 1

He enlisted the help of Buffalo-Niagara Enterprise, a regional economic-development group, in finding a business that he could pursue for acquisition. The search led Watson to Harrison Industrial Supply, Inc., a specialized cutting-tool distributor headquartered at 6027 Corporate Drive in DeWitt. The firm distributes more than 300 product lines to customers across upstate New York. Watson acquired the stock, assets, and real estate from company owner Theodore (Ted) Harrison on Sept. 28, 2010. Watson declined to disclose the acquisition cost, but noted he used his own cash and a loan from the Elmira location of Five Star Bank to finance the transaction. In his quest to find a new company, Watson first had discussions with one of Harrison’s competitors, H&C Tool Supply. However, the negotiations with H&C Tool Supply Corp. in the Rochester suburb of Greece “fell through” after eight months, Watson says. Watson became familiar with Harrison Industrial Supply through his discussions with H&C and pursued new discussions with Harrison in March 2010. “So, that’s how it started,” Watson recalled. He offered Harrison a five-year contract to remain with the company as a president who oversees day-to-day operations when Watson is not there.

ERIC REINHARDT/THE CENTRAL NEW YORK BUSINESS JOURNAL

Mark Watson is the new president and CEO of Harrison Industrial Supply, Inc. at 6027 Corporate Drive in DeWitt. He acquired the business from Theodore (Ted) Harrison at the end of September 2010. The Central New York Business Journal requested comment from Harrison for the article, but he declined.

Harrison history

Ted Harrison’s father, Clarence Harrison, also known as “Harry,” founded Harrison Supply on Sept. 23, 1974, in Camillus, according to the firm’s website. Ted Harrison then bought the business and property 16 years later. The younger Harrison bought the stock

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from his father on Sept. 24, 1990. At the time, the firm was generating annual sales of $1.5 million. After outgrowing its Camillus location, Ted Harrison moved the business to its current DeWitt location in 1996. The company operates in a 7,500-squarefoot building, which Watson acquired from Harrison in the transaction. Harrison Industrial Supply employs a total of 25 people full time, including 20 in DeWitt

and five workers at the company’s second location in Fairport. Watson intends to hire one more employee for both locations in the next six months. He’d also like to open a new office in the Buffalo area, “hopefully within the next six months,” and a fourth branch in Mississauga, Ont. in the next year. Harrison Industrial Supply generated nearly $11 million in revenue in 2010. Watson is projecting a revenue figure of $12 million in 2011. The firm works with more than 400 suppliers. That includes Goshen, N.Y.–based Blaser Swisslube USA, which produces tool coolants; the Mississauga, Ont. locations of the carbide and tools division of the Japanese firm Mitsubishi; and Iscar Ltd., a maker of cutting tools that operates an office in Bartonsville, Pa. Iscar is owned by Warren Buffett’s Berkshire Hathaway, a large holding company headquartered in Omaha, Neb. Harrison Industrial Supply services “thousands” of customers in New York, but Watson declined to name any of them. Besides H&C Tool Supply, Harrison also competes with Abrasive-Tool Corp. in Rochester, and Rochester–based Kenneth Crosby New York, LLC, which operates an office in Salina. Since acquiring the company, Watson is renting an apartment in Fairport. He says he’ll also stay at the Doubletree Hotel Syracuse in DeWitt, if he has to work at the local office for several days at a time.  Contact Reinhardt at ereinhardt@cnybj.com

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10

• The Central New York Business Journal

February 11, 2011

Own Your Business — Not the Other Way Around H

  ow many business owners out   there feel like their entire com  pany rests squarely on their shoulders, and their backs are breaking under the pressure? If you feel this way, then I know who you are. You’re the person whose dream of owning and running a business has turned into a nightmare. You’re over-worked. You can’t come and go as you please. All of the company’s different problems ultimately land on you to fix. You’re burned out and your personal life is affected. You’re frustrated. You’re tired. You’re surrounded by people, but feel very alone. Despair. First off, let me tell you that you’re not alone. In fact, you’re in the majority of small-business owners that have become owned by their business. Here’s some great news: You can fix it. You’re probably thinking, “Yeah, right. Give me another thing to do. I have no money, no time, and no belief that this can change. I’m stuck and there’s nothing I can do about it.” Please, keep reading. Think back to the day you created your company in your mind. For those of you that grew up in a family business, think back to the day before you took the reins. No matter how long ago that may have been, the significance of how you were feeling and what you were thinking were emotional enough that you can remember. Were you thinking about creating a business where your employees would love their jobs? Were you excited about providing such outstanding products or services that your customers would trumpet your name to all their friends and business would boom? Did you think about how different you would be from past bosses you had that sucked all the air out of the room when they walked in? Sure you did. You were also thinking about how much money you would make and how generous you would be with your team. You would put in a few great years, then work shorter days so you could coach your son’s little-league team or your daughter’s soccer team. Ah yes, the long weekends at your camp and two vacations every year in the Caribbean. At the end of it all, you thought, you’d have a company worth mil-

lions of dollars. Life was great and you were ready. And for the first few years, you gladly worked your tail off. You didn’t mind working nights or weekends if needed. After all, it was a good way to keep payroll down. denney’s You made the sales calls, ser ved your blueprint customers, and even for business worked in production. You did the purchasing and paid the bills. You made the collection calls and did the hiring. You were chief cook and bottle washer and didn’t mind because you knew — you absolutely knew it would all pay off in the end. But as the years continued to pass, your energy was tapped. You tried to hire some great people to help you, but employees always let you down. You didn’t blame them; deep inside you knew you hadn’t interviewed enough people to find the right fit. You never even called the references that were provided. And after you made a hire, you didn’t have time, or even a system, to train your new employees. If you wanted something done right, you just had to do it yourself. OK, you get the picture. Here is the problem in a nutshell: Your business is still operating as a start-up company even though it’s several years old. Think about it. How much leadership depth have you developed? What systems do you have in place to maximize efficiencies? How much of your time do you spend handling tasks that someone else could handle for you at a fraction of your pay? How much (or how little, actually) of your own time is spent developing your team? Are you working “on” the business, or are you still working “in” the business? Does everyone have written job descriptions and a clear understanding of their roles and responsibilities? Who holds them accountable for results? Do you have a formal training program in place for new hires? What about developmental training for your existing employees? What are you doing for your own professional development? Is everyone on the same page? Do

jon denney

your individual team members (employees) know why the company exists? Do they know why you started it in the first place? Do they know what it’s supposed to look like? Do you know your employees’ goals? Do they know your goals? Do they know what’s in it for them (beyond just a paycheck)? Do they understand how a business makes money? Are they in-tune enough with your business to be able to identify and fix the many, little operational holes that money pours through every month? Do your customers still feel as loved by you as they used to? Have you taken them for granted in recent years? When’s the last time you talked to your best clients about their business? Do you know what their challenges are? Do you know what their goals are? What do they love about your product or service? How would they improve it if they could? Here is an important question to ask to see if you’re still operating as a start-up business: “What would happen to your company if you stopped working there?” OK, there are 27 pretty darn good questions that all need to be answered. But you don’t have time to find the answers to these questions. And worse yet, if you had the answers to those questions, you’d know you have a lot more work to do. You certainly don’t have time for more work. But here’s one more, very important question: “If you don’t answer those questions, and address those issues, who will?” You already know the answer: Nobody. And that’s precisely why you feel the way you feel today. Instead of leading your business — developing it and nurturing it — you work in it. You’re just as “taskoriented” as you were in the early days of your business. Do you know why Syracuse University’s legendary basketball coach, Jim Boeheim, doesn’t score points or block shots during a game? Because it’s not his job. His job is to recruit talent, make sure his team is agile and skilled, has depth, takes initiative, works in synchronicity, and is prepared to win games. His job is the same as yours. Think about that. You have to figure out how to get out of the proverbial trees and work on the forest.

Here’s your action step: Read the book “The E-Myth Revisited,” by Michael Gerber. It’s an easy read and is even enjoyable. Most importantly, though, it will clearly show you the problem and how to start to solve it. Moving your business from infancy, to adolescence, to maturity (your vision) will take time and effort. Like all meaningful transitions, it takes patience and care. It won’t happen all at once; it will require many small steps. You deserve the fruits of your risk and your labor. Take the first step: read the book. Then, decide on your next step. Maybe that will be to make a list of the things you can easily pass off to someone else. The next step: pass those things off to someone accordingly. When that’s done, the next step will appear to you, but could include: writing a vision/mission/values document, writing comprehensive job descriptions and developing a formal organizational chart so everyone is clear on their roles and responsibilities, scheduling and conducting regular performance evaluations, creating or outsourcing the creation of a training program for new hires, scheduling appointments to reconnect with your customers, creating an operations manual for your business (systems and procedures), brainstorming your company goals with your team and creating a bonus game around meeting those goals, revamping your interviewing process and hiring procedures, outsourcing the redesign of your marketing material, and enrolling in a leadership development program. The list of possibilities is endless. If you involve your team in the process, you’ll get some great, differing points of view to consider. Furthermore, your team can take steps for you and they’ll appreciate the opportunity to show you how valuable they are. Don’t let tomorrow be a continuation of the same old story. Stop the madness today by taking action. It won’t be easy, but you can do it. q Jon Denney is president of Jon Denney & Associates Consulting, LLC and chairman and CEO of Avalon Document Services in Syracuse. Contact him at jon@teamavalon. com


The Central New York Business Journal • 11

February 11, 2011

NSF awards Rheonix $500K in new funding for testing system BY KEVIN TAMPONE JOURNAL STAFF

ITHACA — Rheonix, Inc. of Ithaca won a new $500,000 grant from the National Science Foundation (NSF) that will support continued development of a system to detect contamination in water. Rheonix technology has a number of applications beyond water testing, includ-

ing human and veterinary in vitro diagnostics, food and beverage manufacturing, and more. On the water-testing front, the company is working on a system to test recreational water for bacteria. Beaches around the country are routinely tested to guard against contamination, according to Rheonix. The NSF funding is a Small Business Innovation Research (SBIR) Phase II grant.

The company earlier won NSF money in Phase I and IB grants. “The Rheonix system not only achieves accurate results within a few hours, but also permits the distinction of viable from nonviable organism,” Rheonix President Tony Eisenhut said in a news release. “Because of its capabilities, we believe that the Rheonix ... system will permit the U.S. [Environmental Protection Agency] to

fulfill a court order to reduce the time required to evaluate the safety of recreational water to same-day results. “We are also actively seeking strategic partnerships to market this innovative new technology platform in recreational water quality markets.”  Contact Tampone at ktampone@cnybj.com

POLL: Almost half the Syracuse executives say they plan to invest in fixed-asset acquisitions Continued from page 3

increase of 8.3 points over last year and 56.2 points from two years ago. First Niagara’s survey found 35 percent of business executives said they expect business conditions for the state economy to improve in 2011, as compared to 32 percent last year, 11 percent entering 2009, and 19 percent entering 2008. For 2011, only 33 percent anticipate worsening conditions, down from 41 percent last year. The results this year indicate a “more balanced view,” John Koelmel, president and CEO of First Niagara Financial Group, Inc., said during the webcast. “Certainly, it’s been a very negative, pessimistic outlook for the last two or three years and we think the survey indicates, and further affirms, that the new normal is beginning to evolve,” Koelmel said. Nearly 40 percent of 121 Syracuse–area business leaders surveyed expect the state’s business conditions to improve in 2011, up from 31 percent last year and from 9 percent entering 2009. Another 26 percent expect conditions to remain the same in 2011, while 35 percent believe business conditions will worsen. That figure is down from 48 percent last year and 68 percent entering 2009, according to First Niagara. When asked about challenges facing upstate New York business leaders, 28 percent of executives cited adverse-economic conditions, 18 percent mentioned governmental regulations, 16 percent said taxation in their biggest challenge, and 12 percent cited the cost of health care, the survey found.

The local outlook

Of the 121 Syracuse–area business executives surveyed, 76 leaders (63 percent) expect to maintain their current labor force in 2011. Another 30 leaders (25 percent) predict an increase in their current work force, and 14 executives (12 percent) expect to cut the size of their work force.

When asked about acquisitions, almost half the executives (47 percent) say they plan to invest in fixed-asset acquisitions over the next year to meet growing demand, reduce costs, or enhance profitability. Another 16 Syracuse–area business leaders (13 percent) weren’t sure. Of those that intend to invest in fixed assets, 64 executives (53 percent) plan to use internally generated funds while 25 (21 percent) intend to finance with the assistance of a financial institution. Local business executives are also more optimistic about generating more revenue and benefitting from higher profits in 2011. When asked for revenue projections for 2011, 58 executives (48 percent) predict their companies will generate increased revenue figures, up from 28 percent last year. Another 29 executives (24 percent) believe their sales will stay the same, and 34 leaders (28 percent) see their revenue generation decreasing in 2011, down from 37 percent in 2010.

Statewide outlook

When asked to compare business conditions in New York at the end of 2010 as opposed to six months earlier, about 29 percent of the 645 respondents said conditions were a little better or considerably better. That figure compares to 28 percent in late 2009, 2 percent in 2008, and 16 percent in 2007. “Businesses have fought through and survived the toughest economic times of the past 80 years,” Koelmel said in a news release. “Although still cautious, the more balanced outlook is encouraging as we continue to emerge from the economic challenges we experienced.” Regarding their own industry and current-economic conditions in New York compared to six months earlier, 36 percent of executives said they were about the same, 36 percent said a little worse or considerably worse, and 28 percent said a little better or considerably better. When asked about their outlook for

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2011, 34 percent of executives expect business for their own industry in New York to be a little better or considerably better in 2011. In addition, another 34 percent said it will be about the same, and 30 percent believe it will be a little worse or considerably worse, down from 36 percent in 2010 and 60 percent in 2009. Despite the more positive outlook, the same business leaders reflected an “overwhelming” lack of confidence in the ability of both state and federal governments to

improve the business climate in upstate New York, according to the survey results. The survey found 86 percent of executives say state government is doing a poor job of creating a business climate in which their company can succeed, and 93 percent say they are either not very or not at all confident in the ability of government to improve the state’s business climate.  Contact Reinhardt at ereinhardt@cnybj.com

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12

• The Central New York Business Journal

February 11, 2011

TOP RANKS: ADVERTISING AGENCIES Ranked by CNY FT Ad Staff

Radio

Television

Newspapers

Trade Pubs.

Consumer Mags.

Direct Mkt.

PR

Web/Internet

Other

% of 2010 Billings

16

12

8

6

4

10

28

15

-

5

25

5

5

-

10

20

30

-

22

strategic planning, marketing, advertising, 40 public relations, research, and new media

40

5

5

5

-

-

5

-

American Dairy Association, Nationwide Insurance, CooperCrouse Hinds, Solvay Bank, McClurg

Louis J. Latorra, CEO Darlene L. Latorra, EVP Finance Micahel J. Ancillotti, EVP Account Svcs. Mark Anderson, Media Director

1993

25

100

5

25

15

5

5

10

10

25

-

GM, SBLI USA, Oneida County Tourism, Adirondack Bank, Sitrin, Cooley Group, North American Vegetarian Society, Kids Oneida, Maty's Healthy Products

Timothy J. Trainor, President & CEO

1985

15

25

100

growth strategy, innovation, brand strategy, customer strategy & marketing, advertising, software applications, iPhone apps, social media, social-networking development, software development, digital consulting direct-mail marketing, digital-color printing, graphics print/production

-

-

-

-

-

75

-

10

15

Time Warner Cable, HewlettPackard, Agilent Technologies, Aspen Dental Management, Raymour & Flanigan Furniture

Michael J. Barker, President/CEO Edward C. Mertens, Jr., VP/Creative Director John T. Kinslow, VP Operations Terry L. Brennan, Director of Sales

1993

Paige Marketing Comm. Group, Inc. 258 Genesee St., Suite 204 Utica, NY 13502 (315) 733-2313/ 733-1901 www.paigegroup.com

14

14

11

marketing, public relations, analog & digital implementation platforms, government relations & issue management, media planning

5

5

5

14

5

10

25

30

8

Indium Corp., SEACO, Burrows Paper Corp., Cathedral Corp., Shumaker Engineering, Saratoga Associates, MVWA, OHSWA, NYS DPS, Bank of Utica Corp.

Nancy Pattarini, President & CEO Christine Shields, VP Media Director Claude Schuyler, VP Senior Creative Director

1968

7.

Riger, A Marketing Communications Company 53 Chenango St. Binghamton, NY 13902 (607) 723-7441/ 723-7623 www.riger.com

11

12

20

marketing communications — full service 10 or unbundled — consumer and B-to-B advertising, branding, PR, design, media, research, web and interactive

10

10

5

5

5

25

15

-

BCIDA, CFCU, ESSA, Excellus BCBS, GHS, Sanofi Pasteur, UHS, Wilber National Bank

Peter J. Cronk, Managing Partner Mark A. Bandurchin, VP Creative Services Steven D. Johnson, VP Client Services

1950

8.

Iron Design, Inc. 120 N. Aurora St., Suite 5A Ithaca, NY 14850 (607) 275-9544/ 275-0370 www.irondesign.com

10

10

93

business brand and identity development

4

-

8

8

3

28

-

49

-

Todd Edmonds, CEO

1993

.

Professional Media Services 185 Genesee St., Suite 1600 Utica, NY 13501 (315) 797-8236/ 724-8094 www.promediaonline.com

10

10

60

media consulting, media placement, Internet marketing

18

20

15

2

3

10

2

20

Kenneth Roser, CEO Roxanne Roser, CFO Lisa Militano, VP Ops. Lisa Roser, Sr. Marketing Consultant

1981

.

Designworks Advertising, Inc. 109 Twin Oaks Drive Syracuse, NY 13206 (315) 431-0808/ 431-4235 www.designworksadv.com

10

10

40

brand building, image enhancement, fullservice marketing, improving bottom lines, web and social media strategies, food and restaurant specialists

5

10

25

5

-

10

10

10

-

-

David Bellso, CEO Michele Bellso, President Darcy DiBiase, VP SM Scott Herron, Creative Director

1992

.

Performance Bridge Advertising 115 Court St. Binghamton, NY 13901 (607) 723-3772 www.performancebridge.com

10

13

-

Internet management and consulting for online marketing including display, search, & social media

-

-

-

-

-

-

-

100

-

Audible.com, Accquote.com, Ice.com

Stephen Smyk, CEO

2004

Rosanne Sall Advertising, Inc. 88 Main St. Binghamton, NY 13905 (607) 772-6868/ 771-0644 www.rsadagency.com

9

9

25

advertising and marketing for retail/ service businesses; transit advertising sales for Broome, Tompkins, and Chemung counties

25

35

15

1

1

5

3

5

10

Olum's, Tioga State Bank, Tioga Downs Casino, Comfort & Son Jewelers, Serafini Nissan Volvo

Rosanne Pinker, Founder, President Monty Pinker, COO Thomas Raff, Creative Director Mary Roper, Media Director

1985

.

MPW Marketing LLC 12½ East Park Row, Suite A Clinton, NY 13323 (315) 853-1080/ 853-1081 www.mpwmarketing.com

9

9

19

strategic marketing, B2B, B2C, advertising 10 creative, media buying & planning, TV, radio, print, publications, websites & online marketing, SEO, SEM, social media, custom programming

20

10

20

0

5

5

15

15

Totaline, Carrier Northeast, Faxton St. Luke's Healthcare, Nye Automotive, Masonic Home

Matt Wilson, Owner

2006

14.

The Ad Group Agency, Inc. 114 Cottage St., Suite 201 Oriskany Falls, NY 13425 (315) 306-4009/ 306-4013 www.the-ad-group.com

8

11

65

16

37

34

2

2

2

1

1

5

David C. Bean, President David A. Peroni, Media Director Kimberly Bridge, Head of Operations

1996

.

Romanelli Communications 2 College St. Clinton, NY 13323 (315) 853-3941/ 853-3946 www.romanelli.com

8

9

35

informed and strategic marketing 20 communications, client engagement, and relationship building

20

10

5

-

10

10

25

-

Joe Tahan's Furniture, Fenton Ford, Choice Family Dental, Herb Philipson's, Davidson Automotive Group, Hear USA, Oneida Healthcare Center, Rome Teachers FCU F.X. Matt Brewery, First Source Federal Credit Union, JAY-K, JETNET LLC, Mohawk Valley Heart Institute, UFCW Local 1500

Joseph Romanelli, President Beth Romanelli-Hapanowicz, Vice President

1973

.

ABC Creative Group 430 E. Genesee St., Suite 203 Syracuse, NY 13202 (315) 471-1002/ 471-2240 www.abccreativegroup.com

8

-

25

idea-based marketing, hospitality & tourism, organizations/associations, online media

10

10

5

5

10

30

5

15

-

FASNY, Central Leatherstocking Region, Cresthill Suites, Madison County Tourism, Dairylea Cooperative, Inc., Perry's Ice Cream

Travis Bort, Creative Director & Owner Michael Haines, Sr. Art Director Nell Beadling, Account Manager Jamie Leszczynski, Account Manager

1986

.

Cowley Associates, Inc. 235 Walton St., Suite 210 Syracuse, NY 13202 (315) 475-8453/ 475-8408 www.cowleyweb.com

8

12

15

brand development/strategy, strategic planning, creative communications, web strategy/development, social media

10

-

10

-

-

35

10

15

-

Stickley Furniture, Dermody Burke & Brown, Skaneateles Jewelry, Syracuse Home Association, HOACNY, DMD Medical, Roth

Paul J. Cowley, CEO Gail Cowley, COO Dan Roche, VP Sales/Mkt.

1975

Rank

Name Address Phone/Fax Website

2010 Total CNY FT CNY Ad Staff Emp. 103 219

No. CNY Clients 41

1.

Eric Mower and Associates 211 W. Jefferson St. Syracuse, NY 13202 (315) 466-1000/ 466-2000 www.mower.com

2.

Pinckney Hugo Group 760 W. Genesee St. Syracuse, NY 13204 (315) 478-6700/ 426-1392 www.pinckneyhugo.com

35

35

45

3.

Latorra, Paul & McCann 120 E. Washington St. Syracuse, NY 13202 (315) 476-1646/ 476-1611 www.lpm-adv.com

23

23

4.

Trainor Associates 135 Oxford Road New Hartford, NY 13413 (315) 797-7970/ 797-7975 www.trainor.com

20

5.

Integrated Marketing Services, Inc. 4682 Crossroads Park Dr. Liverpool, NY 13088 (315) 433-1190/ 433-1134 www.intmarkserv.com

6.

12.

Company Specialties business-to-business marketing, public relations and public affairs, consumer advertising, brand promotion, digital/ direct/relationship marketing

branding & strategic planning, research, graphic design, direct marketing, media buying, public relations, social media, video production & interactive development

creative, comprehensive in-house production facilities for TV, radio, and print; collateral materials, POS merchandise, websites, branding

Note: Information was provided by representatives of listed organizations and their websites. Other groups may have been eligible but did not respond to requests for information. Central New York includes Broome, Cayuga, Chemung, Chenango, Cortland, Herkimer, Jefferson, Lewis, Madison, Oneida, Onondaga, Oswego, Seneca, St. Lawrence, Tioga, and Tompkins counties.

Year Notable Clients Key Executives Estab. Kodak, Pass & Seymour/Legrand, Eric Mower, Chairman & CEO 1968 Crouse Hospital, Verizon Wireless, Fran Nichols, COO, Managing Partner Wells Fargo Advisors, Galson Hal Goodman, CFO, Partner Laboratories, Mackenzie Hughes, Chris Steenstra, Sr. Partner, Managing Dir. Cadaret Grant John Favalo, Managing Partner Mark Russell, Sr. Partner Greg Loh, Sr. Partner, Public Relations and Public Affairs Alliance Bank, N.A., Bush Brothers Douglas Pinckney, President 1940 & Co., CXtec, Kinney Drugs, New Aaron Hugo, Executive VP York State Fair, Onondaga Christopher Pinckney, Executive Creative Community College, Redco Foods Director

Advion BioSciences, Alternatives FCU, Binghamton Philharmonic, Cayuga Lake Scenic Byway, Cornell Univ., Corning Inc., Corning Museum of Glass, Middle Ages Brewing 18 -

RESEARCH BY JULIE SHARKEY 02/11 jsharkey@cnybj.com


The Central New York Business Journal • 13

February 11, 2011

TOP RANKS: ADVERTISING AGENCIES Ranked by CNY FT Ad Staff

22. . 24. .

First Media Group, Inc. 120 E. Washington St. Syracuse, NY 13202 (315) 471-7800/ 471-7811 www.firstmediagroup.com Ad Elements, LLC 19 Chenango St., 11th Floor Binghamton, NY 13901 (607) 238-1560/ 238-1563 www.adelements.net TAG Group, LLC 4852 Excalibur Drive Syracuse, NY 13215 (315) 378-0824 www.taggroup.biz

Direct Mkt.

PR

Web/Internet

Other

.

Consumer Mags.

.

Trade Pubs.

19.

Newspapers

18.

Television

Rank

Name Address 2010 Total Phone/Fax CNY FT CNY No. CNY Website Ad Staff Emp. Clients 7 7 8 Foster Martin Agency 78 Genesee St. New Hartford, NY 13413 (315) 797-5073 www.fostermartin.com 6 6 20 Warne/McKenna Advertising 110 S. Lowell Ave. Syracuse, NY 13204 (315) 478-5781/ 474-2155 www.wmck.com 6 6 20 Koenig Advertising Public Relations 309 S. Franklin St. Syracuse, NY 13202 (315) 475-1603/ 475-1613 www.koenig-adpr.com 6 8 Smith Marketing Services 95 Brown Road Ithaca, NY 14850 (607) 257-7000/ 257-2389 www.onlinesms.com 5 5 30 RVSA Advertising, Inc. 236 Main St. Binghamton, NY 13902 (607) 797-4222/ 797-0713 rvsaadvertising.com

Radio

% of 2010 Billings

5

-

10

-

13

12

-

60

-

full-service agency offering traditional and 20 digital advertising services including radio and television production, corporate videos, media buying, graphic design, web design, and QR code campaigns advertising, public relations, graphic 10 design, web development

30

14

-

-

10

2

12

-

25

5

10

-

10

15

20

-

business to business, financial services, 10 economic development, tourism promotion

20

-

10

10

5

25

20

-

Company Specialties mobile application development, Internet & SEO marketing, website design & development, e-mail marketing, design & creative services

radio & TV production, print & design production, media placement, PR

10

40

20

-

5

5

15

5

-

Key Executives Christine Martin, President Foster Fahey, Vice President

East Syracuse Chevrolet, Loretto, Coleman's, Geddes Federal, Diocese of Syracuse, Cashel House, Catholic Cemeteries, Benefit Specialists, Tarson Pools, The Nottingham Rudy Schmid, Medical Coding Svcs., Catalyst Renewables, The MOST, Consumer Credit Counseling of CNY, ClearPath Diagnostics, Eye Consultants of Syracuse New York Air Brake, Railway Supply Institute, Rochester Gas & Electric, NYSEG

Janice McKenna, President Renee Benda, Media Director and Digital Advertising Strategist

1968

Stewart H. Koenig, President Judy Schmid, CFO

1988

Douglas C. Smith, President & CEO Paula Tarallo, Media Director

2000

Visions Federal Credit Union, Lourdes, Good Shepherd Village at Endwell, Good Shepherd Fairview Home, ShortLine Coach USA, Scoville-Meno Family of Dealerships, Mirabito Energy Products confidential

Susan Sands, CFO Richard Sands, VP & Creative Director Penny Stringfield, Media Director Jacqueline Sands, Accounts Supervisor

1969

Michael Hamidi, President Gail Hamidi, Vice President Barbara Shepard, Media Dir.

1980

5

5

12

research, marketing, advertising, web and interactive, public relations, direct marketing (direct mail & e-marketing)

-

12

6

5

-

17

5

27

-

4

5

20

media buying, creative development, promotions for medical, banking/credit unions, universities, sports, retail/service clients

15

30

20

-

5

10

-

20

-

CyberKnife Center of NY, Auchinachie Plumbing and Heating, Ophthalmic Associates

Stephanie Olds-Blodgett, President James Blodgett, VP SM Ashley Camarda, Media Buyer Christopher Coyne, Production Director

2001

4

4

15

public relations

15

-

5

3

2

5

45

15

-

MVP Health Care, Crowne Plaza Syracuse, Sugarman Law Firm, Testone, Marshall & Discenza, CPAs, Beacon Federal, King & King Architects, Performance HarleyDavidson, Magellan Health Services, The Sutton Companies

Kathy Dwyer, President Kathryn Peckham, Principal - Client Services Michelle Bersani, Principal - Creative Services

2002

Note: Information was provided by representatives of listed organizations and their websites. Other groups may have been eligible but did not respond to requests for information.

RESEARCH BY JULIE SHARKEY 02/11 jsharkey@cnybj.com

Central New York includes Broome, Cayuga, Chemung, Chenango, Cortland, Herkimer, Jefferson, Lewis, Madison, Oneida, Onondaga, Oswego, Seneca, St. Lawrence, Tioga, and Tompkins counties.

Tune in to the CNY Business Connection for the latest in local business news, tips, and entrepreneurship.

Year Estab. 2002

Notable Clients -

Business Connection Television

OUR COMPANIES COMPLETE YOUR COMPANY.

(315) 478-4131 www.tt-packaging.com

Watch every weekday morning at 6:30 on MY Network 43/ Syracuse & www.cnybusinessconnection.com

(315) 437-1181 www.empirebox.com


• The Central New York Business Journal

Editor’s Note: These Works-In-Progress reports were omitted inadvertently from the Progress Edition in the Jan. 21 issue of The Central New York Business Journal and thus are appearing in this issue.

The Fulton Companies’ expansion project, Pulaski.

THE FULTON COMPANIES 972 Centerville Road, Pulaski, NY 13142 q Website: www.fulton.com q Products/Services: Fulton Companies is a global manufacturer of steam, hydronic, and thermal fluid-heat-transfer systems. It offers a service-oriented approach to the design and manufacture of creative heating products for use in the following markets: buildings and facilities (including schools, health-care institutions, and government facilities); chemical/pharmaceutical processing; food processing; paper processing; dry cleaning; and asphalt preparation.

February 11, 2011

WORKS IN PROGRESS

Snapshots of results and expectations for Central New York businesses and nonprofits q Total Employees: 785 q General Manager of U.S. Operations: Kathy Sega q Geographic Area Company Serves: Headquartered in Pulaski, Fulton maintains manufacturing facilities in New York, Ohio, and Texas, as well as Great Britain and China. Fulton distributes its products worldwide. q 2010 Corporate Highlights: While many in the manufacturing industry have been significantly affected by troubled economic times, Fulton Companies broke ground in fall 2010 on a 112,000-square-foot addition to its existing manufacturing and corporate headquarters in Pulaski. The new facility will house an 82,000-square-foot addition to the existing manufacturing building, as well as a 10,000-square-foot research and development center and a 20,000-squarefoot corporate office center. q 2011 Corporate Plans/Outlook: The Fulton Companies’ Pulaski facility expansion comes at a time when the company is experiencing increased production demands. Fulton will use the new space to further grow its manufacturing capabilities and existing product lines, as well as focus on the continual development of new products and technologies. As a result, Fulton will not only be adding staff, but the expansion will also serve as an opportunity to concentrate on improving processes and

pioneer COMPANIES 333 W. Washington St., Syracuse, NY 13202 q Website: www.pioneercos.com q Products/Services: Real-estate development and property management q Total Employees: 100 q Top Executive: Michael P. Falcone q Geographic Area Company Serves: New York State, Northeastern U.S., Colorado, and Western U.S. q 2010 Corporate Highlights: Completed

Washington Station in Armory Square and leased nearly 100 percent; began construction at Le Moyne College of the Coyne Science Center addition; completed renovation of Lemoyne Plaza; began Gruen Hall renovations. Began construction management for the Green House project for Loretto in Cicero as well as renovations to numerous existing Loretto properties. CNY Medical Center — renewed lease for Internist Associates on behalf of Cogdell Spencer REIT; engaged by the Oneida Indian Nation to handle asset management of third-party shopping centers; sold Time Warner headquarters building in DeWitt; renewed and expanded the lease for Alliance Bank (28,500 square feet) and signed a new lease with MVP Health Plan, Inc. (14,000 square feet) at AXA Towers. q 2011 Corporate Plans/Outlook: To further integrate the Pioneer Companies of Syracuse with Continuum Partners of Denver under the name of CP Realty Holdings, LLC, whose core business will remain real-estate development and operations. Expect to close on the first CP Realty Fund, which will focus on purchasing value-added shopping centers and hotel properties in selected high-barrier-to-entry markets; will close on the second of a series of limited partnerships that will focus on mixed-use urban infill development sites; expect to complete Coyne Science Center addition; plan to complete Green Houses; and expect to begin construction on Hilton Garden Inn in Auburn. Plan to add staffing in construction, asset-management, and investmentmanagement areas.

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efficiencies throughout all aspects of design and manufacturing for the industry it serves. The new manufacturing building will have increased crane capacity to allow for the engineering and production of larger boilers and heating systems. The new corporate office facility, which features an industrial aesthetic and exposed building system, will facilitate plant tours, training, and product demonstrations. The headquarters addition is slated for completion in spring 2011. As a complement to the expansion in 2011, Fulton Companies will honor its heritage as a family-owned business and honor Fulton founder Lewis Palm with a new product release. Aptly named the “Tribute,” the product pays homage to Palm’s invention of the vertical tubeless boiler, which led to the opening of the Fulton Companies in 1949.

www.tgbbj.com

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CONNECTED

14

SAVE THE DATE  Date: April 28, 2011  Time: 11am-4 pm  Location: Broome County Veteransʼ Memorial Arena

SPONSORSHIP OPPORTUNITIES AVAILABLE! CALL (607) 348-0748 For more information or to exhibit, visit us online at www.bizeventz.com

Title sponsor:

Other Sponsors:

Media Sponsors:

Hosted By:

Produced By:


The Central New York Business Journal • 15

February 11, 2011

SRC: Behler was most recently the senior vice president of MITRE Corp.’s Command and Control Center Continued from page 1

ing subsidiary, SRCTec, together employ more than 1,100 people at 14 locations in Colorado, Maine, Maryland, New York, Ohio, Texas, and Virginia. The firms employ about 800 people in Central New York, where they also have an office in Rome. SRCTec also announced a new CEO recently. Drew James succeeded Mary Ann Tyszko, who resigned from the company in August. James took over in September. Behler succeeds Robert U. Roberts, who is now retired. Roberts remains a member of SRC’s board of trustees. Behler was most recently the senior vice president of MITRE Corp.’s Command and Control Center. The center serves MITRE’s Defense Department sponsors and focuses on creating a joint command, control, and communications system. MITRE is a nonprofit research company originally formed from laboratories at the Massachusetts Institute of Technology. SRC originally began life at Syracuse University before launching as a separate entity in the 1970s. Before joining industry, Behler retired from the Air Force as a two-star general. He grew up in Rome. Here are some of Behler’s thoughts on where SRC is headed. On how the company keeps its edge sharp: SRC spends more than $20 million a year on research, Behler says. Much is connected to specific contracts, but $3 million to $4 million goes toward

the company’s own internal research through its advanced technology initiatives group, which employs 12 people currently. Another five to seven positions will be filled in the current fiscal year and the group will add eight to 10 interns during the summer. The group works on technology that could lead to SRC’s next breakthrough success, Behler says. In addition, the firm has established a strong connection to the academic world. SRC launched a program in 2010 of joint research projects between its own staff and faculty from Syracuse University. On SRC’s customer base: Defense will always be SRC’s sweet spot, Behler says. But its expertise is applicable to other federal agencies as well. The Federal Aviation Administration and Department of Homeland Security represent just two areas Behler says hold potential for SRC. In addition, much of the firm’s work right now is Army-centric so possibilities also exist for the company to diversify within the military world, he adds. On the challenges of a smaller Defense budget: It’s something any company doing work for the Pentagon has to be concerned with, Behler says. “The days of starting from a blank sheet of paper and developing a brand new system, those days are not gone, but they’ll be much more into re-missionizing legacy systems,” he says. “Those sorts of things are challenging for us.” SRC will focus on where it can contribute its high-end engineering skills and help defense leaders meet their major challenges.

On being small: Compared with industry behemoths like Lockheed Martin and General Dynamics, SRC is microscopic. For Behler, that is absolutely an advantage. The company concentrates on agility and quickly adapting to changing customer needs. Its labs and manufacturing facilities can be reconfigured to work on new projects in hours, Behler says. The fact that SRC is a nonprofit corporation is also an advantage. The company doesn’t have to worry about satisfying shareholders or meeting analysts’ earnings estimates. When a scientist comes up with a better way of doing something, the first question doesn’t have to be how long it would take to recoup research dollars, Behler says. On growth: One flip side of being a nonprofit is that the company’s growth will be more measured. But Behler sees that as an advantage as well. He says he doesn’t have to put pressure on vice presidents to meet projections for employee or revenue growth. Expanding can be about what’s right, he says. But that doesn’t mean the company won’t grow. The firm currently has 100 job openings nationwide. “They’re all going to expand,” Behler says of SRC’s locations. Finding the right workers does take time. “The one thing we don’t do is lower our standards,” he says. “We’re not going to hire people off the street just to satisfy a contract. We’re not that kind of company.” SRC generated $701 million in revenue in fiscal year 2010. It is projecting about $565 million in 2011. The firm says its 2010 revenue was higher due to an accelerated schedule of production in

“The one thing we don’t do is lower our standards… We’re not going to hire people off the street just to satisfy a contract. We’re not that kind of company.” n Robert Behler

CEO, SRC, Inc.

manufacturing. On future technologies: SRC’s radar work and its electronic-warfare technology, like its system to counter roadside bombs, tend to get the most attention. But the firm works in areas like chemical and biological defense and information technology and cyber security as well. Working for the Defense Department offers no shortage of ways to apply SRC’s expertise, Behler says. The world of electrical engineering and computer science changes almost daily, he notes. Like any other organization, the military is looking to fit more information into smaller devices and use less energy. But Behler says it wouldn’t be right to pick out by himself what the next big technology for SRC will be. “It has to be what the company is passionate about,” he says. q Contact Tampone at ktampone@cnybj.com

MArkeTplace                                                                                                                                                                                                           

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16

• The Central New York Business Journal

ProLiteracy

KEY STAFF

BOARD OF DIRECTORS OFFICERS Kevin Morgan Rick Lawton Anne DuPrey Thomas Fiscoe

CHAIR Full Suspension Marketing, Inc. VICE CHAIR Lawton Consulting SECRETARY retired TREASURER Danible & McKee, LLP

BOARD MEMBERS Patricio Barriga Valle de Angeles, Honduras Tosca Bruno-van Vijfeijken Syracuse University Ruth Colvin Literacy Volunteers of America, Inc. Shari Daw Freddie Mac Brian Fox Accenture Learning David Harvey ProLiteracy Louis Johnson Sr. River Parishes YMCA Donna Jones Edward Kochian Dr. Robert Laubach New Readers Press Stephen Reder Portland State University Seetha Srinivasan University Press of Mississippi Ambassador George Staples John Ward Emily West The West Foundation John Zickefoose Corona Public Library Nikki Zollar Triad Consulting Services, Inc.

MISSION “ProLiteracy champions the power of literacy to improve the lives of adults and their families, communities, and societies. We envision a world in which everyone can read, write, compute, and use technology to lead healthy, productive, and fulfilling lives.”

SERVICE AREA ProLiteracy has 1,000 member programs in all 50 states and the District of Columbia, and works with 52 nongovernmental organizations in 32 developing countries.

Revenue Sources for ProLiteracy Contributions & Grants Program Services Investment Income Other Total Revenue

Expenditures for ProLiteracy Program Services Salaries & Employee Benefits Management & General Grants Paid Fundraising Expenses Total Expenses Deficit for the year

$3,581,802 $6,323,907 $130,733 $25,559 $10,062,001

$4,483,019 $4,001,113 $775,743 $510,192 $313,279 $10,083,346

Profiling local nonprofit organizations

it

David Harvey President and CEO President and CEO’s Compensation: $224,964 Nan Miller Chief Financial Officer Peter Waite Executive Vice President Mary McGonigel Senior VP for Strategic Initiatives Barry Benson VP for Development & Communications Jane Hugo VP of Programs & Professional Services

FINANCIAL DATA

Year ending June 30, 2010, via IRS Form 990

rof r np ne No or C

1320 Jamesville Ave. Syracuse, N.Y. 13210 Phone: (315) 422-9121 Fax: (315) 422-6369 Website: www.proliteracy.org E-mail: info@proliteracy.org

February 11, 2011

COMPILED BY JULIE SHARKEY

($21,345)

ProLiteracy aims to improve lives and communities through adult literacy BY JULIE SHARKEY JOURNAL STAFF

SYRACUSE — In the United States alone, an estimated 30 million people over the age of 16 can barely read and write English, according to data collected from the most recent National Assessment of Adult Literacy (2003). Without literacy skills, adults fail to reach their full potential as parents, community members, and employees, according to the nonprofit ProLiteracy. The ability to read, write, perform simple math calculations, and use technology is necessary to break cycles of illiteracy, poverty, and social injustice. Based in Syracuse, ProLiteracy is the world’s largest organization of adult literacy and basic education programs. Formed when Laubach Literacy International and Literacy Volunteers of America, Inc. merged in 2002, the organization’s mission is simple — championing the power of literacy to improve the lives of adults and their families, communities, and societies. ProLiteracy supports about 1,000 member organizations throughout the U.S., offering adults instruction in basic literacy, GED preparation, math, and English as a second language. During the 2008-09 fiscal year,

ProLiteracy served 277,808 adult learners, who logged 7 million hours of instruction via online courses, webinars, and face-to-face training sessions, through its member programs. According to ProLiteracy’s 2008-09 statistical report, 71 percent of these group affiliates reported having student waiting lists, both for basic literacy and for English-as-a-secondlanguage services. Internationally, ProLiteracy partners with 52 grassroots organizations in 32 countries “to embed basic literacy skills within local community development projects throughout the world,” says David Harvey, president and CEO of ProLiteracy. This is known as the “Literacy for Social Change” teaching method. Community residents in Asia, Africa, Latin America, Eastern Europe, and the Middle East can select projects from one of the six action areas: health, economic self-reliance, environment, education, peace, or human rights/status of women. Program staff then incorporate drawings of real-life situations that learners encounter while working on their community projects — with related questions, vocabulary words, and key ideas — to help learners identify solutions to See PROLITERACY, page 18

ProLiteracy Facts  Year Established: 1955  Number of Full-Time Employees: 70  Programs & Services: ProLiteracy helps build the capacity and quality of programs that are teaching adults to read, write, compute, use technology, and learn English as a new language by: • Advocating for public policies and legislation that benefit adult learners and the people and programs that serve them; • Providing professional development and training, technical assistance, publications, online resources, and credentialing services for program directors, instructors, trainers, and volunteer tutors working with adult learners in the U.S.; • Working internationally with grassroots partner programs, incorporating native language literacy lessons into community action projects using a methodology called Literacy for Social Change; • Publishing educational materials that address the learning needs and difficulties of adult learners and older teens; • Sponsoring an annual national conference and regional conferences, bringing together regional constituents from all fronts of the adult literacy effort to address the challenges facing adult literacy programs.

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The Central New York Business Journal • 17

February 11, 2011

OPINION

Business Journal C e n t r a l

N e w

Y o r k

The Problem Is Mandates

Volume 25, No. 6 - February 11, 2011 NEWS Editor-in-Chief........................Adam Rombel arombel@cnybj.com Assistant Editor..............Maria J. Carbonaro mcarbonaro@cnybj.com Staff Writers........................... Kevin Tampone (Online Editor) ktampone@cnybj.com ............................................................Traci DeLore tgregory@cnybj.com .........................................................Eric Reinhardt ereinhardt@cnybj.com Columnists......................................Jon Denney David john Marotta Tom Morgan Thomas Walsh Production Manager.......................Erin Zehr ewebb@cnybj.com Research Manager................... Julie Sharkey jsharkey@cnybj.com SALES Sr. Account Managers....................................... Bernard B. Bregman bbregman@cnybj.com Mary LaMacchia mlamacchia@cnybj.com Marketing .......................BBB Marketing Inc. CIRCULATION

T

  he recent rhetoric from Washington   inspired this thought: Our biggest   national problem is the same problem your school board faces. It’s also the same problem you may have faced at some time. School boards struggle with annual budgets. When there is not enough money, they have to make cuts. They usually cut — or threaten to cut — the sports programs, or other popular programs. The reason is that they don’t have many other options. In truth, they control only a small portion of the budget. The rest of the MORGAN budget the state and AT LARGE federal governments control. The state in particular. The state tells schools what they must do in a host of areas. These are called mandates. The mandates may be forcing the school to spend more and more. And, that spending may be killing local taxpayers. But, the school board cannot stop the mandates. They are locked into the spending to meet the mandates. The mandates eat up most of their budget. You may have faced similar problems. You have a huge mortgage. And, a huge credit-

Tom MORGAN

Circulation Management....(315) 579-3927

Publisher..........................Norman Poltenson npoltenson@cnybj.com

Business Manager.....................Kurt Bramer kbramer@cnybj.com

The Central New York Business Journal (ISSN #1050-3005) is published every week by CNY Business Review, Inc. All contents copyrighted 2011. All rights reserved. No part of this publication may be reproduced without the written consent of the publisher. Cover Price $2 Subscription Rate $86 per year Call (800) 836-3539

HOW TO REACH US MAIL: Send letters to: Editor, The Central New York Business Journal 269 W. Jefferson St. Syracuse, N.Y. 13202-1230 E-MAIL: letters@cnybj.com PHONE: (315) 472-3104

school board cannot slash what it will spend on its lunch program. The state and feds mandate what they have to feed the tykes. This is set in stone. These big programs are the problem. They cost more than the country can pay. Paying for them is plunging us further into debt. And, pay for them we must, because they are set in stone. It’s just like school mandates. Just like your mortgage. Can states re-write mandates? Can you renegotiate your mortgage? Can Washington re-write these big programs? Yes. But it is a big deal. The politicians don’t like to mess with big deals like this — because doing so will anger too many voters. We will not get out of this mess until some politicians show some backbone, some courage. They need to show the courage to cut the benefits of these big programs, the courage to admit the truth to voters and face their wrath. That, unfortunately, is a tall order — taller than most of our politicians. You only stand tall when you employ a lot of backbone. Backbone is in short supply in Washington. From Tom ... as in Morgan. q

 

Tom Morgan writes about financial and other subjects from his home near Oneonta, in addition to his radio shows and new TV show. E-mail him at tomasinmorgan.com, or for more information about him, visit his website at www.tomasinmorgan.com

NY Small Business Cheers Ruling in Federal Health-Care Challenge

Administrative

Chief Operating Officer......Marny Nesher mnesher@cnybj.com

card bill. And maybe a home-improvement loan. And now, you find there is not enough money to pay your bills every month. Now, you can cut down on your other spending. But, that will not solve your problem. Your problem is that the mortgage, loan, and credit-card payments eat up most of your budget. Washington has the same problem. Mandates eat up most of the budget. The president can talk all night about freezing spending for five years. He can brag about saving money here and there. He can pretend that his people will root out waste. (Right, Mr. President.) All this is like the school board cutting out the basketball program. It’s like you switching from steak to hamburger to balance your home budget. It ignores the basic problem. The basic problem is that once Washington pays for the mandates, there ain’t much left to tinker with. The mandates for Washington’s budget are the big programs that are set in concrete: Social Security, Medicare, and Medicaid. A bunch of welfare-type programs. When the president calls for a spending freeze, the freeze does not apply to these programs. He may cut back on the food for the squirrels, but the food for the elephants remains the same. Congress cannot freeze or cut the spending on these programs next year. The White House cannot suggest it either. Just as your

 

by nfib/new york

T

  he National Federation of   Independent Business (NFIB)   applauded a ruling in federal court on Jan. 31 overturning the controversial Patient Protection and Affordable Care Act (the national health-care reform law). Mike Elmendorf, state director of NFIB/New York, said the decision is a major victory for small businesses in the state. “The mandates, penalties, and regulatory burdens imposed by this law are costly and confusing opinion to New York small businesses,” said Elmendorf. “We are very pleased by the judge’s ruling … and we are confident that higher courts will agree that the law is an unprecedented and unconstitutional power-grab by the federal government.” NFIB is the only business organization in the country to have joined 20 states in a lawsuit against the measure.  Since NFIB filed its case, six more states have joined, meaning that a majority of states (26) now reject the federal law as an intrusion into their constitutional rights.  While costs to small businesses are staggering, the organization’s main objection focuses on the so-called individual mandate. “The federal government has no authority in the Constitution to mandate that private citizens purchase a commercial service or

NFIB/ New york

product,” said Elmendorf.  “If the federal government can order people to buy insurance, then it can order people to do virtually anything else it considers appropriate. New Yorkers and New York small businesses do not want to be ordered into commercial contracts by strangers in Washington, D.C.” Elmendorf stressed that New York small businesses have been greatly concerned about the cost of health care and that they very strongly support real reform. “Our members support reforms that would expand choice, reduce lawsuits, create portability and put health care consumers in control of the most important decisions,” said Elmendorf. “Unfortunately, this law fails to create those reforms. In fact, it makes our system less efficient, more bureaucratic and costlier for small businesses and their employees.” Karen Harned, director of NFIB’s Small Business Legal Center, said the law violates the Constitution because it concentrates too much power into the hands of politicians and bureaucrats in Washington. “NFIB is extremely pleased with Judge Vinson’s decision,” said Harned. “NFIB joined this case to protect the rights of small-business owners to own, operate and grow their businesses free from unnecessary government intervention. The individual mandate, which forces citizens to purchase government approved health insurance, undermines this core principle and gives the federal government entirely

too much power. We are delighted Judge Vinson agreed with NFIB and the states on this critical issue.” In his decision, Judge Vinson ruled that Congress lacks the constitutional authority to force citizens to purchase health insurance: “Because the plaintiffs maintain that an individual’s failure to purchase health insurance is, almost by definition, “inactivity,” the individual mandate goes beyond the Commerce Clause and is unconstitutional.” Page 13 “In every Supreme Court case decided thus far, Congress was not seeking to regulate under its commerce power something that could even arguably be said to be “passive inactivity.”  Page 41 “It would be a radical departure from existing case law to hold that Congress can regulate inactivity under the Commerce Clause.” Page 42 “Because the individual mandate is unconstitutional and not severable, the entire Act must be declared void.” Page 76 Harned said, “On behalf of small-business owners nationwide, NFIB is determined to overturn this unconstitutional law. [The Jan. 31] decision represents the first significant legal victory on our way to having the U.S. Supreme Court ultimately strike down this law in its entirety.” q This editorial is drawn and edited from a new release that NFIB/New York issued Jan. 31.


18

• The Central New York Business Journal

February 11, 2011

PEOPLE ON THE MOVE: New Hires and promotions ENGINEERING The C&S Companies has promoted Maureen Clegg and Jim Olcott to service group managers. Clegg now leads the firm’s education and healthcare service group. She has nearly 30 years experience in consulting engineering. She is a structural engineer with technical expertise Clegg in the design of structural steel, reinforced concrete, masonry, and wood structures. She is a licensed professional and a LEED-accredited professional. Olcott leads the firm’s energy service group and has 15 years experience Olcott with a wide range of energy projects. His expertise includes identifying, developing, and implementing energy conservation and generation projects. He has significant experience with commodity-consulting services, advising on traditional and renewable procurement strategies. Olcott is a licensed professional engineer and certified energy manager. Elizabeth McCormick was recently hired by Plumley Engineering, P.C. as an environmental analyst in the environmental

division, where she is assisting in environmental permitting and compliance projects. McCormick received a bachelor’s degree in biology from Union College in Schenectady in 2006 and is a 2010 graduate of Pace University School of Law in White Plains, where she focused on environmental and energy law. She recently passed the New York and New Jersey bar exams and is awaiting admission in both states.

INSURANCE Peggy Wilson has joined Eastern Shore Associates Insurance (ESA) as a commerciallines representative. Wilson is an insurance professional with more than 13 years experience.

Wilson

LAW Robert D. Scolaro has joined The Wladis Law Firm, P.C. Scolaro’s practice concentrates on estate and business-succession planning and elder law. He previously was a partner at Scolaro, Shulman, Cohen,

Scolaro

Fetter & Burstein, P.C. Scolaro graduated from Ohio Wesleyan University and Suffolk University Law School and is admitted to practice law in New York, Florida, and Massachusetts.

MARKETING & PR Pinckney Hugo Group promoted Rachel Vaughn to public-relations account manager. Vaughn has worked at the firm for two years. Prior to joining Pinckney Hugo Group, Vaughn gained experience in public relations and marketing at another upstate New York advertising agency and at St. Jude Vaughn Children’s Research Hospital’s fundraising organization in Rochester. She holds a bachelor’s degree in communications from SUNY Geneseo. Strategic Communications, LLC (SCLLC) has hired Frank Caliva, III as senior consultant - public affairs and strategy development. Prior to joining SCLLC, Caliva worked as a senior international trade specialist at the U.S. Department of Commerce. A native of Syracuse, Caliva has a master’s degree from the School of Foreign Service at Georgetown University, and a bachelor’s degree in political science from Providence College.

REAL ESTATE Bea Maher has joined the John Arquette Properties sales team. Maher had a long career as a real-estate agent and licensed associate broker.

TECHNOLOGY Sue Magari has joined INFICON as the director of human resources. Before coming to INFICON, she worked for Pass & Seymour Legrande as vice president of human resources. Magari Magari holds a bachelor’s degree in business from Columbia College, and SPHR certification. Sensis Corp. has named Brian Edward and Edward Valovage senior fellows, an elite group of Sensis engineers that have demonstrated preeminence in their specialty, sustained technical contributions to the company and its customers, and leadership. Edward’s developments have contributed significantly to the success of a number of Sensis Defense and Security Systems programs. Valovage has made numerous important contributions to a number of Sensis Air Traffic Systems products and programs. q

ProLiteracy: Announced its plan to relocate its offices to the Near West Side area of Syracuse Continued from page 16

local problems. In addition, ProLiteracy’s publishing division, New Readers Press (NRP), develops and distributes literacy instructional products, with all proceeds from sales of these materials supporting literacy programs in the U.S. and worldwide. Last year, ProLiteracy’s National Book Fund provided grants totaling more than $150,000 worth of NRP books and other educational materials to teachers, tutors, and students who otherwise would have gone without because their programs couldn’t afford them. NRP’s flagship publication, News for You, the weekly newspaper for adult readers, expanded in 2010 and now delivers articles online with audio via NewsforYouOnline. com. At the end of February, NRP plans to launch a mobile app so that paid online subscribers to NewsforYouOnline.com will have the opportunity to easily access information from anywhere they have access to the Internet. In an effort to increase funding from the federal government and state governments to support instruction in adult literacy and basic education, and to meet the goal of educating 20 million adults by 2020, ProLiteracy advocates for public policies and legislation that benefit adult learners and the people and programs that serve them. “It’s a cost-effective investment that brings back returns many times over,” says Harvey. In mid-September 2010, former Congressman Dan Maffei announced the

creation of the first-ever, bipartisan House Adult Literacy Caucus. The caucus calls attention to the connections between adult literacy and national priorities like economics and health. The caucus, currently comprised of 17 members, is chaired by Phil Roe (R-Tenn.) although the name of a co-chair is said to be announced soon. On the heels of the formation of the caucus, ProLiteracy and Literacy Powerline, a national network linking communitybased literacy coalitions across the country, presented the Declaration for Right to Literacy scroll to congressional leaders on the steps of the Capitol building. It’s modeled after the historic Seneca Falls Women’s Rights Convention in 1848. In adding their names to the scroll, signers believe that “all people in the U.S. have a basic right to education,” says Harvey. The scroll began its cross-country journey in June 2009 at the National Community Literacy Convention, collecting more than 30,000 signatories before arriving in Washington, D.C. More recently, ProLiteracy announced it planned to relocate its offices to the Near West Side area of Syracuse. Along with public broadcaster WCNY, ProLiteracy plans to become an anchor tenant in the former Case Supply warehouse located at the corner of Wyoming and Marcellus streets in the SALT District. “We want to be a real member of the community,” says Harvey, adding that the move will allow ProLiteracy to directly engage with and impact the lives of those who ultimately benefit from its services. The nonprofit is currently located on

Jamesville Ave. in the city of Syracuse. The relocation will also provide the organization with the opportunity to work together with WCNY on educational projects and programming. To support the move into a more technology-rich and environmentally efficient facility, ProLiteracy just launched its firstever capital-fund drive. The organization is seeking to raise $2 million by June 2012. So far, ProLiteracy has generated commitments toward 10 percent of its goal. ProLiteracy is also in the midst of establishing a Center for Adult Literacy Excellence to serve as both a resource to local and regional members, and as a national learning lab and demonstration center to advance adult-literacy research, practice, and professional development. Also in 2011, ProLiteracy will launch its new conference format. The U.S. Conference on Adult Literacy will offer three regional conferences to allow more members access to cutting-edge information and support closer to home. The first regional conference is slated for Feb. 25 in Milwaukee, Wisc., with two others scheduled for this spring and summer in Linthicum, Md., and San Diego, Calif., respectively. The national conference will take place in Houston, Texas on Nov. 2–5. In fiscal year ending June 30, 2010, ProLiteracy generated $10 million in revenue, with almost 60 percent of that figure coming from its publishing division, NRP, according to its IRS Form 990. That same year, the organization spent almost $5 million on its program services and another

ProLiteracy Facts (cont.’d) n  Recent Organizational Highlights: • Established the first-ever House Adult Literacy Caucus in the U.S. House of Representatives • Launching a new conference format in 2011, offering three regional conferences in different areas of the country before the national conference takes place in the fall • Anticipating moving to the Near West Side section of Syracuse in an effort to more directly engage with adult learners who use ProLiteracy’s services n  Planning Outlook for 2011: • Launching the first-ever capital-fund campaign at the end of February to support ProLiteracy’s move to the Near West Side • Feb. 24-25, U.S. Conference on Adult Literacy (USCAL): Midwest Regional conference in Milwaukee, Wisc. • May 24-25, USCAL: Mid-Atlantic Regional conference in Linthicum, Md. • June 9-10, USCAL: Western Regional conference in San Diego, Calif. • Nov. 2-5, USCAL: National conference in Houston, Texas $4 million on salaries and benefits for about 70 full-time employees. q Contact Sharkey at jsharkey@cnybj.com


The Central New York Business Journal • 19

February 11, 2011

february 15 n Syracuse Tech Meetup from 5:30 to 7 p.m. at The Tech Garden, 235 Harrison St., downtown Syracuse. The presenter will be Steven Gal, who has co-founded and grown six venture-capital-backed companies. The event is free, but reservations are encouraged. To register or learn more, visit www.meetup.com/Syracuse-TechMeetup n International Association of Administrative Professionals (IAAP) Meeting at 6 p.m. at The Maplewood Inn, 400 Seventh North St., Liverpool. The topic of the program will be “How To Market Your Business.” The program is free for IAAP members and costs $10 for nonmembers. RSVP to Pam at (315) 882-1700 or e-mail syracuseiaap@aol.com n Where’s the Informal Learning? discussion from 7:30 to 8:30 a.m. at Panera, 3409 Erie Blvd. E., DeWitt. Presented by the CNY ASTD’s Social & Informal Learning Special Interest Group. For more information, call (315) 546-2783 or e-mail: info@ cnyastd.org

february 17 n Connecting Grantseekers with Grantmakers Workshop from 11:15 a.m. to 12:15 p.m. at The Robert P. Kinchen Central Library. This is a free, basic grantseeking workshop designed for 501(c)(3) nonprofit organizations. Learn about the Nonprofit Resource Center collection at the Kinchen Central Library and receive hands-on training on how to use the Foundation Directory Online database to find new funding sources. Meet on level three for collection orientation. Call (315) 435-1900 to pre-register. Space is limited.

february 22 n Communicating with Your Elected Officials, Improving Communication Between Farmers and Policymakers meeting from 10 a.m. to 1 p.m. at the Natural Resource Center, 7413 County House Road, Auburn. Presented by Cornell Cooperative Extension of Cayuga County, together with the Farm Bureau. There is no cost. For additional information, contact Keith Severson, CCE Cayuga, at kvs5@cornell.edu or call (315) 255-1183, ext. 225, or contact Skip Jensen at the NY Farm Bureau, by e-mail: sjensen@yahoo. com, or call (315) 945-3095.

february 24 n CNY BEST Information Session from 5:30 to 6:30 p.m. at Aspen Dental Management, Inc., 281 Sanders Creek Parkway, East Syracuse. The CNY ASTD (CNY Chapter of American Society for Training & Development) will hold an infor-

Business Calendar OF EVENTS

mational session regarding the CNY BEST Learning and Performance Awards and nomination process. Call (315) 546-2783, or e-mail: info@cnyastd.org for details.

MARCH 1 n New Venture Orientation from noon to 12:50 p.m. at the South Side Innovation Center, 2610 S. Salina St., Syracuse. The Innovation Center, part of the Whitman School of Management at Syracuse University, will host this session led by Joanne Lenweaver, director of the WISE Women’s Business Center. This session will provide information on the initial steps that are critical to launching a successful business and ultimately achieving profitability. This class is free. For information, contact Alicia Millington at (315) 443-8634 or e-mail: acmillin@syr.edu

MARCH 8 n International Business Forum Series – Global Assignments: Key Strategies in Managing Employer Costs and Employee Expectations from 8:30 to 10 a.m. at Onondaga Community College, Whitney Applied Technology Center, Room 101, 4585 West Seneca Turnpike, Onondaga. The presenter will be Kristin Sampson, director of global human resources for Providium Consulting. The cost is $30; members of the CNY International Business Alliance (CNY IBA) receive a 20 percent discount. For information on CNY IBA, this event, and future events, visit www.cnyiba.net or contact John Tracy at (315) 453-4070.

MARCH 23 n New Venture Orientation from 5:30 to 7 p.m. at the South Side Innovation Center, 2610 S. Salina St., Syracuse. The Innovation Center, part of the Whitman School of Management at Syracuse University, will host this session led by Joanne Lenweaver, director of the WISE Women’s Business Center. This session will provide information on the initial steps that are critical to launching a successful business and ultimately achieving profitability. This class is free. For information, contact Alicia Millington at (315) 443-8634 or e-mail: acmillin@syr.edu

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march 24 n CenterState Business Show 2011 from 9 a.m. to 5 p.m. at the NYS Fairgrounds, Toyota Exhibition Center. For more information, visit www.centerstatebusinessshow.com or contact Sharon Grabosky at (315) 470-1870 or e-mail: sgrabosky@centerstateceo.com

march 28 n Nonprofit Awards Luncheon from noon to 2 p.m. at the Doubletree Hotel Syracuse. Presented by The Central New York Business Journal and produced by BizEventz, the awards will honor nonprofit staff, executives, volunteers, and programs. Visit www.bizeventz.com for more information as it becomes available.

april 12 n CenterState CEO Annual Meeting from noon to 1:30 p.m. at the Oncenter War Memorial Arena. The meeting will feature the $250,000 Emerging Business Competition, the Business of the Year Awards, and more.

april 14 n AccelerateCNY from 8:30 a.m. to 5 p.m. at the Holiday Inn Syracuse-Liverpool. The keynote speaker will be Spirit Airlines CEO Ben Baldanza. The cost is $75 to attend. To learn more or register for updates, visit www.AccelerateCNY.com

ONGOING EVENTS n Every Tuesday, Gung Ho Networking Group from noon to 1:30 at Ruby Tuesday Restaurant, 3220 Erie Blvd East, DeWitt. The cost is $10 and includes lunch. Contact Paul Ellis at (315) 6770015, or visit www.GungHoReferrals.com n Every Tuesday, Networking @ Noon from noon to 1 p.m. at Justin’s Grill, near Carrier Circle. The growing networking group is always looking for new members. E-mail Bill Wood at whwood@ ft.newyorklife.com for further information. n The first Wednesday of each month, Business Innovation Days meetings

from 9 a.m. to 5 p.m. at The Tech Garden, 235 Harrison St., Syracuse. This is an opportunity for entrepreneurs and small businesses to meet one-on-one with a counselor from the Small Business Development Center to obtain advice and customized assistance opportunities. Scheduled by appointment, call The Tech Garden at (315) 474-0910 or e-mail: info@ thecleantechcenter.com n Every Wednesday throughout 2011, Salt City Technical will offer free consultation to entrepreneurs or inventors who would like to have their product ideas evaluated by a staff of trained engineers. For more information about Salt City Technical services and to schedule a consultation, call (315) 456-8461, or visit www.saltcitytechnical.com n Second Wednesday of each month, Salt City Technical assistance by appointment at the Tech Garden; free consultation to entrepreneurs or inventors who would like to have their product ideas evaluated by a staff of trained engineers. For details or an appointment, call (315) 474-0910 or e-mail: info@thetechgarden.com n Every Thursday, Empire Statesmen Toastmasters meet at 6:30 p.m. at Ruby Tuesday on Erie Boulevard in DeWitt. For more information, visit http://estm.freetoasthost.info or e-mail president@estm. freetoasthost.info n Every second and fourth Thursday of the month, The North Star Toastermasters from noon to 1 p.m. at C&S Companies, 499 Col. Eileen Collins Blvd., near Hancock Airport. For more information, contact Siva Jonnavithula at sivaj@cscos.com or call (315) 703-4342. n Every Friday, Tip Club of Syracuse, at the Sheraton Syracuse University Hotel, 801 University Ave., Syracuse, 8 to 9 a.m. Call Bernie Bregman at (315) 472-3104, ext. 103 or e-mail: bbregman@cnybj.com n Every Friday, The Mature Workforce Alliance from 9 to 11 a.m. at Westcott Community Center, at the corner of Westcott and Euclid streets in Syracuse. For further information, call John Cruty at (315) 569-3964 or e-mail: crutij@yahoo. com n Every week, Syracuse Networking Professionals. Five meetings to choose from. For details, call Kevin M. Crook at (315) 439-1803, or email KevinSNP@twcny.rr.com or visit SyracuseNetworkingProfessionals.com

To have your meetings or events in the Business Calendar, e-mail them to movers@cnybj.com 


20

• The Central New York Business Journal

T:10”

February 11, 2011

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T:12.75”

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QUARTERLY FINANCIAL

PANEL INVESTMENT INVESTMENT

Editor’s note: The Investment Panel feature appears regularly in our Financial Quarterly publication, spotlighting area investment professionals and their views on the markets and investments. In this issue, we chat with Joe Bombard, Jim Burns, Diane Rodgers Costello, and David K. Griffith. We interviewed them separately, but asked the same questions. Bombard and Burns talked via telephone with Adam Rombel, editor-in-chief. Costello and Griffith communicated through e-mail with Traci DeLore, staff writer.

PANELISTS

Bombard

Joseph (Joe) Bombard, managing directorinvestments in the Syracuse office of Wells Fargo Advisors. James (Jim) Burns, president of J.W. Burns & Company in DeWitt.

Vol. II, No. 1

www.cnybj.com

February 11, 2011

Cover Story

Local KeyBank leader is bullish on 2011 Editor’s Note: The Newsmaker Interview portion of Financial NEWSMAKER Quarterly features a conversation with a CEO of a publicly traded Central New York company every quarter. The story discusses key financial issues affecting the newsmaker’s company and industry.

INTERVIEW

BY KEVIN TAMPONE JOURNAL STAFF

Burns

Diane Rodgers Costello, owner/ partner of Wealth By Design Financial in Binghamton. She is also president of the Financial Planning Association of the Southern Tier of New York. David K. Griffith, owner of D.K. Griffith & Co. in Utica. Griffith

Business Journal: What is your view on where the financial markets are headed in the coming months? Bombard: That’s a very, very difficult answer to give, mainly because in the next few months See PANEL, page 5B

Inside Stuff

:

SYRACUSE — Although the lending environment remains tough and competitive, KeyBank’s Central New York president says the bank is expecting big things in the region for 2011. After a $1.6 billion loss in 2009, Cleveland, Ohio–based parent KeyCorp (NYSE: KEY) rebounded in 2010 with a profit from continuing operations attributable to common shareholders of $413 million, or 47 cents a share. The banking company’s local operations generated improved results as well and that trend should continue, says Stephen Fournier, president of Key’s Central New York district. “We are not going back on defense,” Fournier says. “We are going to stay on offense. We’re pretty bullish on what’s going to happen in 2011.” On the retail side, Key opened 77 new branches companywide in the past two years and has plans to open another 40 this year. At least one of those will be in the Syracuse area, Fournier says.

PHOTO COURTESY OF KEYBANK

Fournier

Above, the KeyBank branch on Albany Street in Cazenovia. The bank plans to open a new location in Manlius.

The bank plans to open a new location in Manlius in a new retail-office-residential development planned for the heart of the village. Key already has a branch in nearby Fayetteville. “We feel like there’s some opportunity based on the demographics that may help us grow further out east,” Fournier says. KeyBank is the leading bank in the Syracuse–area deposit market with 28 branches, about $2.4 billion in deposits, and a deposit-market share of 22.16 percent. The bank has two branches and about

$88.8 million in deposits in the Utica–Rome area, according to the latest statistics from the Federal Deposit Insurance Corp. The bank has total assets of about $92 billion and more than 1,000 branches in 14 states. Key’s Central New York district, which includes 17 counties from Plattsburgh to Rochester, has 74 branches. The bank employs 450 people in the region. Fournier notes that Key plans to work on See NEWSMAKER, page 5B

FQ

On The Rise  Syracuse leads consumer-confidence increase in Q4. Page 2B

DATA FILE FO SALR E

 Charts provide information on the regional housing market (Page 3B) and airport-passenger traffic (Page 6B).


2B • The Business Journal

FINANCIAL QUARTERLY

February 11, 2011

Survey: Syracuse leads regional consumer-confidence gains in Q4  Syracuse posts the biggest rise in consumer confidence in Q4

Albany

Buffalo

NYC

Syracuse

Q4 ’10

Q3 ’10

Q2 ‘10

59.6 56.3 60.8

Q4 ’10

Q4 ’10

Rochester

69.3 63.6 60.3

Q3 ’10

68.3 62.5

Q3 ’10

65.5

Q2 ‘10

70.4

Q2 ‘10

68.0

Q4 ’10

Q2 ‘10

Q2 ‘10

Q4 ’10

Binghamton

63.4

Q4 ’10

59.6 59.1

Q3 ’10

58.4

Q3 ’10

55.7 57.1

Q2 ’10

63.9 63.0 62.5

Q3 ’10

71.9

Q4 ’10

C

onsumers across every region of New York became more confident about the state of the economy in the fourth quarter of 2010. Consumer-confidence levels in the fourth quarter rose 9 points in the Syracuse region, 4.5 points in the Utica–Rome region, and 1.3 points in the Binghamton area, respectively, compared to the third quarter. That’s according to the latest quarterly survey of nine metropolitan-statistical areas (MSAs) in New York by the Siena (College) Research Institute (SRI), issued Jan. 13. The overall-confidence index soared to 69.3 in the Syracuse region, increased to 60.8 in the Utica–Rome region, and rose to 58.4 in the Binghamton area. The increase in confidence in Syracuse was the biggest in the state, while the confidence rise in Binghamton was the state’s smallest. The confidence-survey readings ranked Syracuse second, Utica–Rome eighth, and Binghamton ninth, respectively, among the nine areas surveyed, according to SRI. Syracuse ranked second behind the New York City region, which had an overallconfidence index of 70.4, according to the survey. When compared with the overall-confidence index readings in the fourth quarter of 2009, the Syracuse region’s confidence rose nearly 8 points, the Utica–Rome region was down 1.3 points, and the Binghamton area rose 3.3 points, according to SRI.

Gaining Ground

Q3 ’10

JOURNAL STAFF

Q2 ’10

BY ERIC REINHARDT

Utica

SOURCE: SIENA COLLEGE RESEARCH INSTITUTE

The overall-confidence index is a combination of the current-confidence and futureconfidence components. Syracuse’s current-confidence index was up 7.9 points to 77.3 and its future confidence increased 9.7 points to 64.2, according to the SRI data. Syracuse’s current-confidence index reading represents “one of the only times in recent memory” that any region has exceeded the break-even point of 75 in a consumer-confidence measurement, says Donald Levy, SRI director. It means consumers have reached the point where they no longer believe that conditions are going to get any worse, he adds. “So we’ve hit the point, at least right now, where I no longer believe … that my personal place in the economy is worsen-

ing,” Levy says, analyzing the responses of consumers in the Syracuse region. Respondents seem to believe that it’s a good time to buy, especially if their job is secure and they have some money, Levy says. “So, we’ve hit this point of current stability,” he adds. The SRI survey finds the current-confidence and future-confidence levels are up in all nine MSAs, except for the Albany region. In analyzing the data, Levy doesn’t think Syracuse consumers are so much optimistic about the future, as they are considerably “less pessimistic” than in past surveys, he says. He notes that Syracuse’s future-confidence index of 64.2 is still 10 points under the point at which optimism and pessimism

would balance each other out. However, in moving from the mid-50s to the mid-60s in confidence readings, the Syracuse area now has only a small percentage of respondents that believes the economy will continue to deteriorate, whether it’s over a one-year or a five-year period of time. “I would tend to label it lessening pessimism, as opposed to growing optimism,” Levy says. He also believes the rising price of gas could affect consumer-confidence levels in the year’s first quarter. If consumers see steady or intermittent increases over the course of the first quarter of this year, it’ll be a “major variable” in what happens to the regional confidence levels. “If it cost me $25, $30, $100 more every month to put gas in my tank, it’s going to come out of my ability to spend on other things,” Levy says.

Buying plans

While consumer confidence is reported as an index number, the buying-plans portion of the survey reflects the percentage of respondents who plan specific expenditures in the next six months. Of the 45 buying plans measured across the nine MSAs, 38 were up this quarter, five were down, and two were unchanged, according to the SRI data. In the Syracuse region, buying plans See CONFIDENCE, page 7B

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FINANCIAL QUARTERLY

February 11, 2011

DATA FILE FQ

The Business Journal • 3B

HOME PRICES IN 16-COUNTY CNY REGION Median sales price of existing single-family homes sold in 4th quarter 2010 compared to other quarters

HOME SALES IN 16-COUNTY CNY REGION Number of existing single-family homes sold in 4th quarter 2010 compared to other quarters County

4Q 2010

3Q 2010

4Q 2009

% Change 3Q 10 to 4Q 10

% Change 4Q 09 to 4Q 10

BROOME CAYUGA CHEMUNG CHENANGO CORTLAND HERKIMER JEFFERSON LEWIS MADISON ONEIDA ONONDAGA OSWEGO SENECA ST. LAWRENCE TIOGA TOMPKINS CNY TOTAL

260 122 144 56 78 60 235 37 108 370 843 176 70 151 64 129 2,903

271 153 154 75 63 40 247 32 143 386 924 167 61 179 47 173 3,115

406 176 180 96 87 59 248 44 163 454 1,192 233 109 180 87 149 3,863

-4.1 -20.3 -6.5 -25.3 +23.8 +50 -4.9 +15.6 -24.5 -4.1 -8.8 +5.4 +14.8 -15.6 +36.2 -25.4 -6.8%

-36 -30.7 -20 -41.7 -10.3 +1.7 -5.2 -15.9 -33.7 -18.5 -29.3 -24.5 -35.8 -16.1 -26.4 -13.4 -24.9%

County

Median Price 4Q 2010

Median Price 3Q 2010

Median Price 4Q 2009

% Change 3Q 10 to 4Q 10

% Change 4Q 09 to 4Q 10

BROOME CAYUGA CHEMUNG CHENANGO CORTLAND HERKIMER JEFFERSON LEWIS MADISON ONEIDA ONONDAGA OSWEGO SENECA ST. LAWRENCE TIOGA TOMPKINS

$101,727 $107,450 $99,000 $76,000 $113,500 $93,250 $139,900 $113,000 $131,000 $110,000 $133,400 $99,500 $83,000 $85,000 $134,750 $170,000

$108,500 $110,000 $111,250 $75,000 $106,000 $92,330 $149,900 $123,000 $123,000 $119,000 $138,000 $96,000 $108,000 $82,950 $90,000 $200,000

$118,000 $100,350 $84,950 $97,000 $105,621 $82,000 $133,000 $90,000 $117,900 $106,000 $124,700 $85,280 $99,900 $78,250 $125,000 $159,900

-6.2 -2.3 -11 +1.3 +7.1 +1 -6.7 -8.1 +6.5 -7.6 -3.3 +3.6 -23.1 +2.5 +49.7 -15

-13.8 +7.1 +16.5 -21.6 +7.5 +13.7 +5.2 +25.6 +11.1 +3.8 +7 +16.7 -16.9 +8.6 +7.8 +6.3

SOURCE: NYS ASSOCIATION OF REALTORS, INC.

FO SALR E

FO SALR E

FO SALR E

FO SALR E

SOURCE: NYS ASSOCIATION OF REALTORS, INC.

Siena real-estate poll: consumers expect improvement BY ERIC REINHARDT

Consumer Real Estate Sentiment

JOURNAL STAFF

N

ew York consumers still maintain a negative view of the real-estate market, but they remain convinced that improving conditions are on the way. The finding is part of the quarterly survey of consumer realestate sentiment from the Siena (College) Research Institute (SRI) and the New York State Association of Realtors (NYSAR), which they jointly released Jan. 19. The survey measured realestate sentiment in the fourth quarter of 2010 on buying and selling now and in the future in eight metropolitan-statistical areas (MSAs) in New York, including the Syracuse, Utica–Rome, and Binghamton regions. A sentiment score of 0 in any category reflects equal levels of pessimism and optimism among survey respondents. Scores above 0 show optimism and scores below 0 indicate pessimism. Overallsentiment scores combine the current and future sentiments on buying and selling a home. Statewide, the overall currentsentiment score is -32.0, one point worse than in the third quarter; the overall future score is +16.0, up 3.2 points.

Syracuse 4th Quarter 2010

50

30

40

24.0

21.1

20

14.3

-30 -40

12.4

12.5

6.5

10

0 -20

25.4

30 20

10 -10

Utica 4th Quarter 2010

50

36.2

40

Consumer Real Estate Sentiment

0

Overall Current

Overall Future

Current Sell

Future Sell

Current Buy

Future Buy

-10 -20

Overall Current

Overall Future

Current Sell

Future Sell

Current Buy

Future Buy

-30

-25.4

-40

-37.2

-50

In addition, the sentiment scores are +33.1 to buy now, down 2 points from the third quarter; +15.1 to buy in the future, which is down 6.8 points; -42.2 to sell now, down 2.1 points; and +14.1 to sell in the future, up 0.8 points from the previous quarter, according to the SRI survey. The numbers for sentiment score are similar for the upstate region, according to the SRI data. Sentiment scores in the range between +10 and +20 would be good for sellers and good for buyers, says Donald Levy, SRI’s director. For sellers, it would indicate plenty of buyers and a good time to move. For buyers, it would seem to show ample inventory. “That would be a thriving, robust, healthy, real-estate market.

-36.9

-50

We spent the entire year [in 2010] a long way from it,” he says. In Central New York, the overall current sentiment is -25.4 in the Syracuse region, down 5.3 points from the third quarter; -36.9 in the Utica–Rome area, down nearly 4 points; and -38.7 in Binghamton region, down 0.4 points. At the same time, the overall future sentiment is +21.1 in the Syracuse region, up five points; +12.4 in the Utica–Rome region, up 11.3 points; and +10.1 in the Binghamton area, up 5.5 points. The overall future-sentiment reading of +21.1 is “an indication that people in Syracuse feel pretty strongly that conditions in the market will improve over the next year,” says Levy. Of the eight regions measured,

-48.9

Consumer Real Estate Sentiment Binghamton 4th Quarter 2010

50

38.4

40 30

22.3

20

12.7

10.1

10 0 -10

Overall Current

Overall Future

Current Sell

Future Sell

Current Buy

Future Buy

-20 -30 -40 -50

-38.7

Buffalo had the highest overall current sentiment at -13.7, while the Binghamton region had the lowest overall current sentiment at -38.7. In terms of overall future sentiment, the Buffalo region

had the highest reading at +24.3 and the Binghamton area had the lowest overall future sentiment at +10.1. See POLL, page 7B


4B • The Business Journal

FINANCIAL QUARTERLY

February 11, 2011

Save Your Social Security Payroll Tax Cut T

his year, the government reduced Social Security taxes by 2 percent. More than 150 million workers will receive up to $2,136 each. The assumption is we can spend our way out of unemployment. Instead, you should boost your savings rate by 2 percent to ensure you don’t fall behind on your retirement savings. We can’t spend our way out of economic trouble as a country, any more than we can grow taller by pulling on our shoestrings. Increased spending is an indicator of economic health only when it MAROTTA follows increased proON MONEY duction and earnings. Rich people generally spend more. But that certainly is not what makes them rich. A far better scenario would be if we as a country tried to save and invest our way out of a recession. Imagine if everyone invested their rebate by creating new businesses or building factories. Then we as a nation would produce more. Increased annual production could be sold, which would increase our gross domestic product. Consuming more goods doesn’t really help our economy when half the stuff we buy comes from China anyway. In fact, deferred consumption is the definition of capi-

DAVID JOHN MAROTTA

tal and would allow us to use that money to build more productive businesses. It would lower unemployment and reduce inflation. President Bush tried the exact same gimmick in May 2008, issuing tax rebates in the form of stimulus checks. I responded just as vehemently that the rebate was a cheap insult directed at the American people and free markets. Every time the government bureaucracy engages in centralized spending plans, the economy is weakened. They believe they are better off, but workers will actually be poorer if the check increases their spending habits by even a penny. Average workers earning about $50,000 a year will see their take-home pay rise by 2 percent, or $1,000. Normally their standard of living after taxes and savings might be $37,000. By age 50 they should have saved about 10 times their standard of living, or $370,000. But if they spend an additional $1,000, they increase their annual lifestyle to $38,000. They will fall $10,000 further behind on funding their retirement. The United Auto Workers (UAW) union supports the idea of the payroll tax cut. It claims, “Working families will likely spend this money in their local communities, creating jobs and stimulating overall growth.” Anyone who spends more than 4 percent actually loses ground in saving toward retirement. Thwart the UAW’s advice and start saving and investing an additional 2 percent of your income this year. To replace your income and be financially independent at a reasonable age, you should

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be saving 15 percent of your take-home pay toward your retirement. I received the following reply to that advice from one of my readers. She wrote, “Few people I know, except for well-paid professionals, can save 15 percent of their income for long-term retirement goals … Sorry, but most people don’t live in this author’s rosy world.” No matter what your salary, there are people living comfortably off 15 percent less money and still managing to save 15 percent of their smaller salary. We could easily begin to ask uncomfortable questions about this reader’s lifestyle. We might find at least 15 percent in discretionary spending that more frugal people could easily eliminate. My reader would have made a more convincing argument if she said we are already being taxed more than 15 percent, which ought to be enough. Most workers don’t know how much they are taxed for Social Security. The correct figure is 12.4 percent for Social Security plus an additional 2.9 percent for Medicare, a total of 15.3 percent. Of the 12.4 percent for Social Security, 6.2 percent is deducted from the employee’s paycheck. The other 6.2 percent is withheld by the employer, who reduces salaries accordingly. In truth, without these governmentimposed taxes, the labor market would settle at paying employees 15.3 percent higher wages. Management doesn’t care whose share it comes out of — either way employees bear the burden of the entire tax. Saving 15.3 percent over a working ca-

reer ought to provide all employees with a retirement income at or greater than their wage during their working years. Instead, the return on Social Security investment is minuscule if you are a rich white woman and negative if you are a poor black man. Nonworking spouses, who never contributed anything to Social Security, are the only group that can claim to have won in the exchange. White House economic advisor Jason Furman said, “The payroll tax cut has absolutely no effect on the solvency of Social Security.” Only in Washington do they pretend the emperor is clothed. How can collecting $112 billion less in Social Security taxes have no effect? The Treasury Department has been instructed to replenish Social Security with additional borrowed money against Treasury bills. The entire Social Security fund is a stack of IOUs written against future tax collections. So I guess adding a few more without first squandering and spending revenue doesn’t really change the solvency. In other words, the system is bankrupt either way. Take ownership of your own financial security and increase the rate at which you are saving and investing by at least the 2 percent Social Security tax cut.  David John Marotta is president of Marotta Wealth Management, Inc., which provides feeonly financial planning and wealth management. Contact him at emarotta.com or visit www.emarotta.com


February 11, 2011

financial quarterly

The Business Journal • 5B

PANEL: Griffith: Because interest rates can only go up…bonds don’t look promising going forward Continued from page 1B

it is anybody’s guess where the financial markets will go. When you look at the economy, corporate profits are really doing well right now. The Federal Reserve is very accommodating with its monetary policies. This should lead to higher markets for the next one or two years. As long as inflation remains tame, we should be in pretty good shape. Burns: Until [the final week of January], we had experienced eight consecutive weeks of positive stock-market returns. So somewhere in the first quarter, I would expect at least a solid pullback of 5 percent or more in equities and possibly even a correction of 10 percent or more. Investor sentiment has gone from extreme pessimism only four months ago to quite a bit of optimism today. That usually portends a pullback of some sort. Now, overall, I am constructive on stocks for the full year of 2011. I would say confidence is returning to businesses and consumers. We are in the third year of the presidential-election cycle, which since 1940 has averaged about a 17 percent annual return. There remains a high degree of liquidity throughout the system, and with QE2, the Federal Reserve clearly signaled its commitment to pump money into the economy and fight deflation. [Editor’s note: QE2 is the second installment of the Federal Reserve’s quantitative easing or bond-buying program.] Basically, the Fed is telling investors, “If you want to be very conservative and hold CDs, money-market funds, or short-term Treasury bills, and not put that money into the stock market go for it. Just know we won’t pay you any return whatsoever.” These low-cash yields will continue to push money out of super-safe investments and into equities. Costello: As January came to a close, it was clear that the stock market remained quite resilient. The S&P 500 Index, a proxy for large cap U.S. equities, returned 2.3 percent in January, which marks the fifth consecutive positive month for the market. The gains were recorded despite record snowfall across the country, increased geopolitical unrest and municipal bonds catching a bout of the “Whitney Flu.” Stocks were not the only asset on the rise, as energy prices remained on their upward trajectory. Snowed-in consumers were forced to turn up their heat to escape the crippling snowstorms that swept the country and left a remarkable 70 percent of the nation staring out windows at a winter wonderland. Another factor affecting oil prices was the geopolitical unrest that

flared up in several spots around the world, including Tunisia and Egypt. Appearing on 60 Minutes in late December 2010, banking analyst Meredith Whitney declared that the municipal-bond market was on the precipice of major defaults. This highly publicized broadcast ignited a fire sale of municipal bonds that led to the worst three-month returns for the Barclays Municipal Bond Index, a proxy for municipal debt, since 1994. Despite the real concern for state and local governments to meet severe revenue challenges, I believe the media hype and market over-reaction has taken a genuine “muni bond cold” and turned it into the “Whitney Flu.” With mandated balanced budgets, increasing state and local tax rates, and an improving economic environment that is raising state revenue receipts, municipal bonds appear to be emerging as an attractive investment opportunity. Despite mounting headwinds, the stock market has shown a remarkable ability to ignore the “noise” and focus on the general improvement in underlying economic conditions. That said, the S&P 500 has risen [about 25 percent] since the end of August 2010, as investors anticipate a recovery in jobs needed to solidify economic growth. With job growth lackluster in recent months, investor expectations could be slightly ahead of economic fundamentals. While I remain optimistic that the market will continue to achieve higher levels than those we see today as economic and earnings growth continues, the climb higher may be choppier than what we have experienced of late. Volatility is increasing and I anticipate the market will face tougher resistance as it moves higher. However, with the economy being supported by increased business spending and a revitalized consumer, the backdrop appears positive for further advances. Griffith: Nobody has a crystal ball, but that doesn‘t stop the talking heads on CNBC from pontificating like prophets. As an investment advisor, I merely put monies into investments ahead of the proverbial curve, meaning before everyone else does. Financial markets are just like oceans, always in flux, with massive tides of money flowing from one fashionable asset class (like gold or bonds) into another (perhaps stocks or real estate). U.S. stock markets and our economy should continue improving over the coming year as our government has powerfully stimulated this economy by spending and printing droves of dollars on top of extending tax cuts. In addition, 2011 is the third year of a spendcrazy Democratic president, who surely

What is your view on where the financial markets are headed in the coming months? Costello: Despite mounting headwinds, the stock market has shown a remarkable ability to ignore the “noise” and focus on the general improvement in underlying economic conditions. wants economic prosperity and surging stock prices to lure voters to clinching a second term. Because interest rates can only go up, albeit gradually, bonds don’t look promising going forward. Investors in foreign stock markets must be agile, but we think Thailand, Singapore, South Africa, and regions of Europe like Russia and Italy offer investment potential with relatively less risk. European real estate (I like the ING European Real Estate Fund – ticker symbol: IAERX) is an excellent investment opportunity. As the old saying regarding land goes: “They aren’t making any more of it!” Business Journal: Provide specific recommendations for investments that clients should be making right now. Bombard: The first thing a client needs to assess is what his risk tolerance is. Once that is established, you need to have a balanced portfolio. The most important thing a client needs to do today is monitor those investments, stay invested, and don’t get shaken out by what the pundits are saying because they don’t know an individual’s particular situation. The best returns people could get over a long time come from being invested in stocks for the long run through a balanced portfolio. Specifically, you have to look at those companies that have a broad product line and sell their products both domestically and internationally. One thing people tend to forget is the U.S. represents only 30 percent of the world’s economy. About 70 percent of the growth is outside the U.S. So, those strong balance sheet, broad-based companies that sell their products both here and abroad do well. Burns: My top pick, and a stock we have been buying consistently over the last few weeks, is Visa (NYSE: V). The stock has come down substantially over the last few months because of the Durbin Amendment, part of the financial regulatory reform law, which basically puts a ceiling

on what Visa and MasterCard can charge on debit transactions. This amendment has put a cloud over the stock but the company has re-affirmed for 2011 revenue growth of 11 to 15 percent, earnings growth of over 20 percent, and free cash-flow increases over $3 billion. I would say the stock is selling at less than 17 times earnings and it’s this kind of uncertainty that is giving investors a chance to buy this stock. Another pick is Aflac, Inc. (NYSE: AFL). This is just a high-quality, brand-name insurer which has been investing in its growth in Asia. Finally, we like the railroad stocks. And, a best-of-breed company is CSX Corp. (NYSE: CSX). Here you have a company that is cyclical in nature and would benefit as the U.S. economy continues to recover. As far as my favorite sector, I believe investors should have positions in energy stocks. It seems like many individual investors are all excited about owning gold stocks. I believe gold is overvalued and energy stocks are in fact undervalued. Gold and oil tend to trade in tandem, because they are both weak-dollar plays but gold had just gone up too much and the price on oil stocks does not reflect the robust fundamental outlook that they will have over the next few years. Here, I would look at Royal Dutch Shell plc (NYSE: RDS-A), which yields about 4 percent. Costello: In order to navigate choppy markets, we believe a three-step approach to investing is prudent. First, we believe investors should consider the expanded investment-opportunity landscape offered with the use of alternative strategies. Second, we plan to focus on those investments that we believe have the greatest probability of maximizing total return for a given market environment. Third, a nimble, tactical approach is necessary to help manage market risks while taking advantage of See panel, page 8B

NEWSMAKER: Loan demand began to improve steadily in the last six months of 2010 Continued from page 1B

growth in all of its businesses in Central New York. That includes areas like private banking, retail, middle market, and business banking. Loan demand, he adds, remained weak during the first half of 2010. It began to improve steadily during the last six months. Still, Fournier acknowledged it will take some time for demand to return to levels

seen before the recession. Although demand for credit wasn’t concentrated in any particular business segment, Fournier did say he noticed companies were starting to look at investments like technology and equipment again. Some things, he says, are simply wearing out and must be replaced after months or years of businesses looking to save by putting off purchases. Some firms are even looking at expan-

sion again and may start exploring largerscale renovations or acquisitions in 2011, Fournier says. He also noted that Key’s local district is one of five nationwide to host a revived management-training and development program in retail-banking leadership. The Central New York district began running the program in 2010. Two other sites re-launched the program in 2009 after a 20-year gap. It’s an effort to

develop a new crop of leaders at Key who will be with the bank for the long haul, says Fournier, who started in a Key management-training program and has been with the bank 25 years. “We’re continuing to invest in our franchise,” he says. “Not only physical investment, but also human capital.” q Contact Tampone at ktampone@cnybj.com


6B • The Business Journal

FINANCIAL QUARTERLY

FQ

SYRACUSE HANCOCK INTERNATIONAL AIRPORT 2010

DATA FILE

OCT.

NOV.

2009 DEC.

TOTAL

ENPLANE DEPLANE

89,725

DEC.

TOTAL

86,094

242,034

85,944

80,657

79,388

76,702

85,198

241,179

85,653

77,246

78,559

76,967

510,199

181,004

TOTAL

AIRPORT-PASSENGER TRAFFIC

91, 279

171,292

NOV.

2009

DEC. TOTAL

OCT.

NOV.

11,720

11,367

12,017

DEC. TOTAL 27,887

9,611

9,806

8,470

34,413 11,540

11,427

483,213

171,597

157,903

35,104 ENPLANE

NOV.

252,169

OCT.

DEPLANE

OCT.

258,030

2010

ELMIRA CORNING REGIONAL AIRPORT

February 11, 2011

157,947

153,669

ITHACA TOMPKINS REGIONAL AIRPORT 2010

27,513

OCT.

NOV.

2009 DEC.

TOTAL

OCT.

NOV. DEC.

33,265

11,446

9,474

29,792

9,477

8,562

TOTAL

23,260

22,794

23,463

19,085

19,283

17,032

2010 NOV. DEC.

TOTAL

OCT.

2009 NOV. DEC.

ENPLANEMENTS

28,177

10,169

9,224

8,784

TOTAL

DEPLANE

GREATER BINGHAMTON AIRPORT OCT.

12,086 11,381

10,147 9,902

9,798

9,743

30,735

11,872 11,218

9,040

7,897

7,806

64,000

8,245

SEE GREATER BINGHAMTON AIRPORT STORY, PAGE 7B

27,122

9,769 9,547

7,645

25,182

TOTAL

TOTAL

55,400

ENPLANE

69,517

23,958 22,599

17,443

56,914

19,916 19,449

17,549


5.5 in

5 in

3.5 in

financial quarterly

February 11, 2011

The Business Journal • 7B

Airport passenger boardings jumped 10.5 percent in 2010 ou Greater and Binghamton your ideas TOWN OF MAINE — Airline passengers flocked to Greater Binghamton Airport (BGM) last year, as the number of passengers boarding planes departing the airport rose to 110,907. That’s up 10.5 percent from 2009, when 100,402 passengers boarded flights from BGM. It’s the third largest annual percentage increase in passenger boardings at BGM since 1984-1985, according to Broome

County Department of Aviation historical records. “We are extremely pleased to achieve double-digit passenger growth in 2010 especially considering the economic struggles we have been faced with locally,” Broome County Executive Barbara J. Fiala, said in a news release the county issued Jan. 13. “Looking to the future, we B:11 willin continue to focus on improving servicesT:10.5 and in options for

e r e n t l y.

both the business and vacation travelers.” With its expanded schedule, Delta Air Lines led the 2010 growth trend by posting a 54.7 percent increase over its 2009 numbers. Passengers responded strongly to the convenience of Delta’s additional round-trip flight to Detroit from BGM and its wide range of connections in Detroit, according to the Broome County news release.

The county also attributed the rise in air traffic at BGM to an improving local economy, augmented by natural-gas activities in the region. Also, the three airlines serving BGM launched many recent fare sales. The airlines currently serving BGM are Delta Air Lines, United Express, and US Airways Express. These carriers offer nonstop service to Detroit, Washington D.C., and Philadelphia, respectively. q

S:9 in

POLL:

Moving into a bigger space. Expanding your footprint. Whatever MacKenzie: “Polling indicates that consumers report optimism about the future housing market ncial services provider that not only shares your belief in your SRI surveyed a minimum of 400 ad- guarantee a minimum of 400 respondents.  and create jobs will be a significant factor in Continued from page ence and ability to bring it3Bto life. We think youanddeserve that As the sentiment scores are developed ditional respondents in each MSA, except future home sales sentiment scores.”

SRI conducted its survey of consumer The sentiment on selling now are to get more out ofscores your money. The power of First Niagara. all double-digit figures below 0 in all three regions, while the scores on selling in the future are above 0 but below 15 in the Syracuse, Utica–Rome, and Binghamton areas, according to the SRI data. Uncertainty about the overall economy “darkened the prism” through which New Yorkers viewed the 2010 housing market, Duncan MacKenzie, CEO of NYSAR, said in a news release. “However, our polling indicates that consumers report optimism about the future housing market. NYSAR believes that Gov. Cuomo’s efforts to cap property-tax growth and implement programs to spur the state’s economy

real-estate sentiment throughout October, November, and December by random telephone calls to 2,448 New York residents over the age of 18.

New York City and Long Island. The New York City sample was obtained as part of the statewide survey and the Long Island sample was primarily obtained through the statewide survey and augmented, so as to

through a series of calculations, “margin of error” does not apply, SRI says. q Contact Reinhardt at ereinhardt@cnybj.com

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CONFIDENCE: In the

Central New York’s most comprehensive development/ construction/real-estate awards program.

Utica-Rome area, buying plans were up 1.3 points to 11.1 percent for computers

May 5, 2011

Holiday Inn Liverpool

Continued from page 2B

d i f f e r e n t l y.

Contact Reinhardt at ereinhardt@cnybj.com

T:15 in

We see you and your ideas

B:15.5 in

S:13.5 in

rose 0.4 points to 17.5 percent for major home improvements, climbed 3.3 points to 17 percent for furniture, increased 0.9 points to 14.3 percent for computers, rose 0.4 points to 11.9 percent for cars and trucks, and edged up 0.7 points to 2.7 percent for homes. In the Utica–Rome area, buying plans were up 0.2 points to 15.8 percent for major home improvements, rose 0.7 points to 13.1 percent for cars and trucks, increased 0.9 points to 12.6 percent for furniture, and rose 1.3 points to 11.1 percent for computers. Buying plans were down 0.7 points to 2.2 percent for homes. In the Binghamton region, buying Support the teams behind the top Expanding your footprint. Don’t wait - nominate NOW at www.bizeventz.com. Startingplans your own business. Moving into a bigger space. Whatever rose 1.9 points to 17 percent for major home projects in Central Newprovider York, Mohawk Nominations are due no later than March 11, 2011. your vision, you need a financial services that not only shares your belief in your improvements, climbed 4.6 points to 16.3 Valley, the Finger Lakes, Greater business, but has the experience and ability to bring it to life. We think you deserve that percent for furniture, were up 1.4 points Binghamton, and the North Country by Forofmore contact: Marny Nesher at BizEventz from your First information, Niagara. to 9.4 percent for computers, edged up 1.1bank. The power to get more out of your money. The power nominating their projects. Please visit mnesher@bizeventz.com • (315) 579-3925 points to 8.9 percent for cars and trucks, and www.bizeventz.com for more information rose 2.2 points to 2.7 percent for homes. on the event and nomination process. SRI used random telephone calls to adults Sponsored By: over the age of 18 to conduct the quarterly survey. The New York City and Long Island Winners will receive “A Time To Build” indexes are based on an average of SRI’s awards and be honored at an awards monthly consumer-confidence surveys. Each luncheon on May 5th at the Holiday Inn of the other metro-area indexes is based on Liverpool. more than 400 respondents. q Visit us at fnfg.com


8B • The Business Journal

FINANCIAL QUARTERLY

February 11, 2011

PANEL: Bombard: The first thing a client needs to assess is what his risk tolerance is Continued from page 5B

potential opportunities. As we continue to seek the optimal blend of risk and reward for portfolios, alternative strategies may play a role in providing access to the broader investment opportunity set. Alternative strategies give investors the ability to fine-tune their desired risk exposure. Since we expect volatile markets to persist, more defensively oriented strategies may be used at a market peak while more opportunistic strategies can be employed at market bottoms. Volatile markets call for focusing on a smaller group of investments that we believe possess the greatest probability of providing excess returns, or “alpha,” in the prevailing market environment. While maintaining a diversified portfolio is still prudent, we believe a relatively smaller group of investments may present a more compelling opportunity. The focal group of investments will change depending on whether financial markets are at the top or bottom of a volatile trading range. At the top of a trading range, volatilitythriving alternative strategies, or those that seek to mute the impact of volatility, will be the portfolio focus. Using alternative strategies that have a lower sensitivity to stock-price movements may assist portfolio performance. In the equity market, a volatile and potentially downward trending market calls for an emphasis on dividendpaying stocks as a way to buffer against volatility and help capture the best total return prospects of large company stocks. Focusing on maximizing returns in an upward moving market does not mean focusing solely on stocks. Commodities — and raw materials specifically — are the main ingredients that fuel the increasing production that accompanies economic expansion. Commodity and alternative-asset exposure can therefore be used alongside stocks as a tool to increase risk in investment portfolios. In the bond market, upwardly moving markets call for a focus on more economically sensitive sectors such as high-yield bonds and emerging-market debt. As the economy continues to expand, even slowly, prices of high-yield bonds and emergingmarket debt may benefit and the extra yield helps buffer against volatile markets. Portfolio allocations must be more dynamic and adapt to market opportunities and challenges as they arise. When market conditions are favorable and volatility is to

the upside, a traditional 60 percent stocks, 40 percent bonds allocation might shift to 65 percent stocks, 5 percent alternative strategies, and 30 percent bonds. Not only would the portfolio allocation shift towards assets that may benefit more from an upwardly moving market (stocks or commodities), but the shift also would entail more cyclical, or economically sensitive, investments. Conversely, when few opportunities are present the allocation might shift to 50 percent stocks, 10 percent alternative strategies, and 40 percent bonds. In this case, we would seek to reduce exposure to investments that may be [hurt] by downside volatility and employ volatility-thriving alternative strategies. Griffith: Investors must constantly strive to find innovative ways of making their money work for them. At D.K. Griffith, we put about a third or more of our clients’ money in alternative investments like equipment-leasing programs, where investor money is used to buy heavy equipment (like a jet engine). The leasing company then leases it to companies like JetBlue for a profit, which the investor earns, too. We also utilize natural-gas income programs as clients buy natural-gas wells that yield butane, propane, and gas, which is then sold to utility providers like National Grid to heat homes, water-heaters, dryers, and stoves. Real estate, another essential ingredient of any truly diversified portfolio, can be bought via the Oppenheimer Real Estate Fund (ticker symbol: OREAX). Each of the three previously mentioned investments provides strong income with tax benefits to boot. But my favorite characteristic of investments like these is that when, not if, stock markets take the inevitable dive, alternative investments keep on chugging. These investments protect principal, while providing monthly checks to happy investors relieved they didn‘t have all their eggs in stocks. For the long-term investor, we fancy stable utility-type stocks like EnCana Corp. (NYSE: ECA), which typically pay strong dividends. Dividends matter. As our society continues to progress, and I use that term loosely, we’ll become more and more dependent on companies like National Grid plc (NYSE: NGG), Hess Corp. (NYSE: HES), Time Warner Cable, Inc. (NYSE: TWC), and Verizon (NYSE: VZ). Our country’s population will always have a strong demand for oil, electricity, information technology, and natural resources. These sectors will always provide investors with strong returns

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and most importantly, dividend income, as mankind becomes more and more dependent on them. The rising interest rate and inflationary environment should also help banks like Citigroup (NYSE: C) and Bank of America (NYSE: BAC). We also like Intuitive Surgical, Inc. (NASDAQ: ISRG) for the long term, as it has no debt and is the future of medical surgery. Gold and other commodities should still be owned, but only sparingly as of now. Investors should beware that a mini market pullback should be coming along in February, perhaps posing an opportunity to buy. Business Journal: Are there Central New York–based companies that are currently attractive investments? Bombard: Even with Central New York–based companies, you have to look at what they’re producing and manufacturing. Hopefully, the products and services they produce can be sold globally. I can’t give you specific names, but those are the type of companies that I would direct clients to consider. Burns: I remain a strong fan of Community Bank System, Inc. (NYSE: CBU). It had a 70 percent increase in profits [in the fourth quarter]. In addition, I do like Lockheed Martin, [which has major plants in Owego and Salina.]. The stock (NYSE: LMT) had been weak because of concerns about cuts in defense spending. To me, that uncertainty creates opportunity. Costello: (Editor’s note: She chose not to answer this question.) Griffith: When scouring for investment opportunity, you shouldn’t limit your “hunting ground” by any border, but ConMed (NASDAQ: CNMD) should perform strongly, as we’re living longer and demand for medical instruments will surely rise. So will interest rates, which benefits local and progressive banks like NBT Bancorp, Inc. (NASDAQ: NBTB) and First Niagara Financial Group, Inc. (NASDAQ: FNFG). Business Journal: What do you see as the greatest risks investors need to be aware of and seek to avoid in the coming months? Bombard: Among the real risks out there that clients have to be concerned about, the first thing is inflation getting out of control. I think that is a big question mark. So far, it’s been tame. But, in the 1970s and 80s, when we lost control and inflation went rampant, it really hurt the

economy. Secondly, the clients I speak to are concerned about some type of world event — a terrorist attack or some geopolitical problem — that will come up and cause some great concern in terms of stalling the world economy. Another concern is the problem facing clients that are getting closer to retirement. Because they are living longer, what I hear them talk about more and more is outliving the money that they have for retirement. Those two issues go hand in hand because if we have some type of global event and it slows down the world’s economies, clients’ portfolios can’t grow. And, that puts an extra burden on their ability to live in retirement for the next 25 or 30 years in a standard to which they’re accustomed. Burns: There are a number of risks. My main concern is a sharp deceleration in economic growth in China. There is a lot of debate as to whether or not China is experiencing a housing bubble. So, if things turn sharply lower there, that could provide a real economic shock to the global economy. There are other risks as well, such as rising commodity prices, severe budget shortfalls at the state level, and a weak housing market, etc., but always keep in mind that markets climb a wall of worry. In fact, if there were no risks or concerns, that would be the greatest concern that I would have. I counsel investors to remain long equities, but also be vigilant. Costello: As always, investors need to be aware of balance in their portfolios. Aligning their portfolio with the specific risk tolerance and view of market risk is imperative. I see the biggest risks to investors is making decisions on emotions rather than following a well-designed portfolio strategy. You must monitor strategy and adjust it over time, because it is the GPS for where one wants to go. To deviate out of fear or exuberance is not a disciplined approach. A non-disciplined approach may lead to financial disaster, especially during turbulent times. Griffith: Investors, especially seniors, must be aware that inflation has and will continue to rear its ugly head — eroding at their fixed income and spending power. Bonds don’t do well during rising interestrate periods. Investors must also anticipate returning volatility, meaning markets will be choppy. The biggest risk I believe investors face is being stagnant. It seems that inflation is higher than what the banks are paying, which means sitting on the sidelines could be costly. q


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