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PIZZA BARONS LAY OFF 1,100: PAPA GINO’S & D’ANGELO WORKERS NEED TO ORGANIZE FOR JUSTICE

Image by Don Kuss
Image by Don Kuss

 

November 7, 2018

BY JASON PRAMAS @JASONPRAMAS

 

Mainstream press coverage of mass layoffs like Sunday’s shutdown of almost 100 Papa Gino’s and D’Angelo fast food restaurants generally looks upon such tragic events through a glass, darkly. Because journalism in the service of the rich and powerful is a poor reflection of reality when it comes to all things labor. Which is why early reportage in major news media typically involves simple transcription of executives’ rationales for such precipitous decisions. Rather than immediate investigation of the massive damage done to the lives of, in this case, more than 1,100 area workers summarily terminated with no official warning of any kind, according to the Boston Globe.

 

True to form, PGHC Holdings Inc., the Dedham-based parent company of both brands, has excuses at the ready for credulous reporters. None of which explain why it’s acceptable to treat its workforce—the people that built the company and kept it running through good times and bad—like so much garbage. But that’s fine and dandy, yes? Given that few journalists ever seem particularly concerned about the human cost of mass layoffs. It’s just assumed (and sometimes stated) that “the market” will take care of everything. Such “disruption” is “good for the economy,” doncha know. And if some hapless working poor people lose their apartments, lose custody of their children, go hungry, and end up on the streets, then that’s their fault for not being “competitive” enough and getting more degrees. Or something. Not the fault of the company that put them there.

 

In any event, according to the Boston Business Journal, PGHC released a statement on Monday explaining “that it had filed for Chapter 11 bankruptcy protection. [The company] also announced that it had reached an agreement in principle to be sold to a portfolio company of Wynnchurch Capital, a private equity firm that has offices in Chicago, Los Angeles and Toronto.”

 

“Private equity firms,” according to a major 2014 investigation by the New York Times, “now manage $3.5 trillion in assets. The firms overseeing these funds borrow money or raise it from investors to buy troubled or inefficient companies. Then they try to turn the companies around and sell at a profit.” Ironically, some of the largest investors in such firms are public sector pension funds. Whose unionized members have no idea what their money is being used for—thanks to byzantine and opaque agreements between their pension funds and firms like Wynnchurch that aim to keep them and the public at large in the dark about buyouts like the tentative PGHC deal.

 

The details that are visible are disturbing enough. According to Boston Globe business columnist Jon Chesto, PGHC “[c]hief financial officer Corey Wendland pointed to one big reason for his company’s need for more dough: minimum-wage increases across many of its markets, combined with higher health insurance expenses.”

 

You read that right. One of the executives directly responsible for destroying the lives of hundreds of working-class families in Massachusetts, Rhode Island, Connecticut, and New Hampshire is blaming legislation that’s gradually raising minimum wages in three of those states (minus, sadly, the Granite State) to levels that they should have been at over a decade back for his company’s crisis. Not corporate mismanagement or malfeasance.

 

It’s basically all the fault of those darned unions and other labor advocates for pushing higher wage floors that still don’t even allow many workers to make ends meet once enacted. Massachusetts, for example, will go from the abysmal $11 an hour rate mandated by 2017 to a somewhat less abysmal $15 an hour over five years starting in January. For readers who think that wage is too high, try living on $15 an hour most anywhere in southern New England right now—assuming you get 40 hours work a week, which many Papa Gino’s and D’Angelo workers didn’t—and see how you do.

 

Naturally, since laid-off PGHC workers weren’t unionized, they had nothing and no one to protect them when the corporate ax fell over the weekend. Even the federal Worker Adjustment and Retraining Notification (WARN) Act that provides extended unemployment and retraining benefits to victims of a narrow range of mass layoffs may not apply here. Although, as with area NECCO workers who were also laid off en masse this year with no notice, it may be worth trying a class action lawsuit to demand WARN coverage anyway. But with most of the affected PGHC workers making minimum wage, they have next to nothing saved to see them through the difficult period they now face. While the unemployment they may not all qualify for will definitely not be enough to live on until they find new jobs, given their low pay rate. So, it will even harder for them to mount such a suit than it has been for the NECCO crew.

 

A D’Angelo manager who writes under the nom de plume C.D. Madeira took a job at another company about three months ago and agreed to provide an insider’s perspective on the layoff crisis to me in an interview. Unsurprisingly, Madeira says that PGHC was not a decent employer even before its recent action.

 

“I worked for D’Angelo for two and a half years as a manager. They treated us like trash, the minimum wage employees worse. Management was paid as little as possible while required to work 50 hours a week and often much much more. More often than not they required us to work that extra off the clock so as not to skew their labor information. They refused to repair restaurants even when it was a danger to employees and customers.

 

“Basically, I’m glad I don’t work there anymore and that I got out before this happened, but I know many people who are now out of a job.

 

“They closed nearly 100 locations, between the Papa Gino’s and D’Angelo brands, leaving over 1,000 people without jobs and without notice. No severance pay. No PTO [paid time off] payout. Nothing. People went to work assuming they would have a job and they were turned away. Those who had jobs were given calls throughout the day to tell them to close up shop permanently. They were told they could apply at other corporate locations for consideration for rehire.”

 

Not that laid-off PGHC workers are exactly taking the situation lying down. Many have plastered the Papa Gino’s Facebook page with angry messages. Leading the parent company to respond on the page with another statement, “While we regret the rather abrupt closures, we are currently undergoing major updates to better serve our guests and ask for your patience as we make these changes. As New England’s local pizzeria since 1961, we are still standing strong and will be relaunching our restaurants, introducing improvements for the benefit of all of our guests.”

 

Madeira doesn’t buy it: “I saw the breakdown of the conference call they had with the general managers who remain. Basically they’re painting this as, ‘Well, now that we have all these underperforming restaurants out of the way, we can totally renovate the remaining locations!’ Many stores they closed were not underperforming. Also they’ve known about this sale for months. They were talking about putting the brand up for sale a couple of months before I left. So this has been in the works for well long enough to have warned people.

 

“They’ve always been shady. Papa Gino’s originally bought the D’Angelo brand to try and save itself but instead ended up dragging it down completely from what I heard from old-time employees.”

 

This is the testimony that the public has not yet heard in the local press. And it’s infuriating, if not much of a shock to anyone who has worked in low-wage sectors like fast food before.

 

The question now is: What can laid-off Papa Gino’s and D’Angelo workers do to get some simple justice? PGHC executives responsible for major social dislocation across our region thanks to the layoffs will be fine. They’ve got golden parachutes. PGHC shareholders will make some money in the sale to buyout firm Wynnchurch Capital. Wynnchurch will make plenty of money by reviving the Papa Gino’s and D’Angelo brands and selling them to the highest bidder, and/or by dumping the buyout debt on the company and making millions in “consulting” fees whether the company succeeds or tanks, and/or by gutting company assets for cash.

 

But what about the workers?

 

All I can say is what I say in pretty much every article I write about labor issues: Workers need to stand and fight. Wherever we are. Whatever our situation.

 

So, for the remaining Papa Gino’s and D’Angelo workers, you all need to unionize. To make sure you have at least the protection of a union contract in the likely event of more layoffs. And better wages, benefits, and working conditions while you all are still employed there. It won’t be easy. But you can be sure that at least two or three major unions—I’m guessing UNITEHERE, SEIU, and possibly UAW—are eager to get in touch with you. I recommend you work with the union that will give you the best service (in the form of staff dedicated to your group) and the most autonomy.

 

And for the laid-off Papa Gino’s and D’Angelo workers? You, too, need to organize. Get together. Talk things over. Get advice from some experienced union leaders and pro bono representation from some labor lawyers. Maybe find a way to sue your former bosses or the new owners for redress under the WARN Act or some other applicable law. Build community support the way Market Basket workers did a few years ago. Explain why it’s not acceptable for large companies to treat people the way PGHC treated you—and even less acceptable for government at all levels to let them get away with it. Raise money and awareness. Formulate demands. For severance pay. For extended unemployment benefits. For retraining. For damages. For whatever you all need to be made whole. Stay in close touch with your former colleagues as they try to strengthen their position.

 

Then figure out how to win some justice… together.

 

Fortunately, a Facebook page has been started to do just that. Called, fittingly, Papa Gino’s Workers’ Reparations. Here’s a short link for PGHC workers reading in print: tiny.cc/papajustice/. Check it out. And best of luck to all of you.

GREENFIELD BLUES: HOMELESSNESS IS NOT JUST A BIG-CITY PROBLEM IN MASS

Greenfield City Hall by ToddC4176 at en.wikipedia [CC BY-SA 3.0] from Wikimedia Commons
Greenfield City Hall by ToddC4176 at en.wikipedia [CC BY-SA 3.0] from Wikimedia Commons

August 7, 2018

BY JASON PRAMAS @JASONPRAMAS

 

We don’t get much news about Western Mass in Boston. And since the population is relatively small in the largely rural western counties of the Commonwealth, it can be easy to miss significant stories. Because the scale of noteworthy happenings is naturally smaller there. Because our diminished metro news outlets have trouble covering the entire state. And because, let’s be honest, Bostonians don’t usually care about what happens west of, like, Brookline.

 

So at first glance, word of a homeless encampment out in Greenfield isn’t something that would get much attention hereabouts at the best of times. But for a city with a population that fell by more than 500 people to 17,456 between the 2000 and 2010 censuses—with a median household income of $33,110, and 14 percent of residents below the poverty line—it’s an important enough development to warrant a series of articles in the local press. And I think it deserves coverage here in the Hub as well.

 

Especially when the encampment is on the Greenfield Common, opposite the Greenfield City Hall (better known as the Town Hall prior to a recent change in nomenclature). Something unusual is definitely afoot.

 

It seems two local homeless people began camping on the common a couple of months ago. A number that quickly grew to 20 regular residents in as many as a dozen tents. According to the Greenfield Recorder, their “de facto spokeswoman” Madelynn Malloy “and others have said previously they are camping on the common because there is no other place that is safe for homeless residents to go and because current city law allows them to stay there day or night. There are no requirements for licenses or permits to be there and the homeless residents’ actions are not considered loitering, but public assembly. The city has an ordinance prohibiting loitering, but it only applies to sidewalks.”

 

A city count of last January pegged the homeless population at 39, but area charities have said the actual number is significantly higher—as they noted during the brutal cold snap at the end of 2017 when their shelters were so overwhelmed that the Salvation Army put up $1,600 to house people at Days Inn. Since that time, the Greenfield Human Rights Commission and homeless advocates have been pushing for the city to do more. Meanwhile, the encampment has put a very human and public face on the crisis, and has sparked meetings and debates in local government about how to find housing for the homeless.

 

Unfortunately, there seems to be at least as much concern from Mayor William Martin to get the city council to pass rules effectively banning camping on Greenfield Common as there is to find ways to house local homeless people. The latter being the obvious policy priority, if for no other reason than to relieve overwhelmed private social service agencies.

 

Most recently, a breakthrough of sorts—also reported in the Greenfield Recorder—happened when the city council voted to put a port-a-potty closer to the common than the one local churches previously made available. “According to the Department of Public Works, the cost of a temporary restroom is $150 a month and includes emptying it. The mayor’s office said the first two months of the portable toilet would be paid for by the Interfaith Council and an unnamed local business. There is no plan currently in place for funding after the two months.” The council also voted, apparently contrary to the mayor’s wishes, to decrease “regulations on churches to set up temporary shelters” and open “the former Wedgewood Gardens property on Kimball Drive as a possible site for an encampment.” The mayor then vowed to “attempt to find temporary housing solutions through a ‘rapid re-housing team’” made up of “city officials and social service and humanitarian agencies.”

 

Baby steps perhaps. But it would not do to underplay the difficult situation Greenfield government finds itself in. It’s going to take officials time to find even a stopgap solution. Large cities like Boston aren’t doing a great job of dealing with a growing homeless crisis either; so it’s obviously more difficult for smaller municipalities with fewer resources to house and provide services for even a few dozen people.

 

Particularly when, as was pointed out in a DigBoston op-ed by Lawrence social services executive Joe D’Amore in January, many communities in Massachusetts ban people from sleeping in public spaces or even “loitering” there. Which merely shifts the burden of dealing with homelessness to more densely populated and tolerant locales with more social services like Lawrence. Or Greenfield.

 

Hopefully people will retain the right to sleep on the Greenfield Common overnight when needed, and the city government will cobble together some longer-term housing options for its homeless population before winter sets in.

 

Yet however things turns out in the largest burg in Franklin County, the situation is interesting not because it is unique… but because it is sadly commonplace. Across Massachusetts and all over America the story is the same. Despite claims of a “strong economy” from Republicans and many Democrats, homelessness is ever more persistent and ever more desperate.

 

To see an actual strong economy in a place like Greenfield, one has to look back to the 1950s—when the city was home to major metal-working concerns, the largest being Greenfield Tap & Die. But that plant was sold off to a larger company in 1958, and most of its jobs disappeared over decades. The city’s last major manufacturing business, Lunt Silversmiths, went under in 2009 during the Great Recession.

 

According to the Republican, Lunt had 800 employees in 2001. And only “12 to 15” by the end. It’s difficult for even larger cities to recover from that kind of blow to their job base, let alone a small city like Greenfield.

 

It will thus shock no one that the rise of the opiate crisis tracks closely to this decline in the city’s fortunes. And it’s therefore ironic in the extreme that the former Lunt plant is now home to two drug treatment facilities, Franklin Recovery Center and Northern Hope.

 

The opiate crisis relates directly to the homeless crisis. And both relate to the ongoing jobs crisis. Increasingly unregulated capitalism, as I often write, is clearly incapable of providing good jobs for our population. As the job base collapses, people in Greenfield, Boston, and around the nation are stuck with lousy part-time, temp, contract, independent contractor, and day labor gigs. Or with no jobs at all.

 

As these downwardly mobile people see their lives collapsing, they turn to opiates. Maybe because they got injured in their precarious pseudo-jobs and got put on addictive pain killers by well-meaning doctors being suckered by criminal conspiracies like oxycontin-maker Purdue Pharma of nearby Stamford, Connecticut. Or maybe because they couldn’t take the humiliation of no longer being able to provide for themselves and their families, and reached for the strongest, most reliable, and readily available chemical solace. And soon enough, more and more of these folks end up on the streets.

 

Without public jobs programs, new public housing, and cradle-to-grave public healthcare, local, state, and federal governments will not be able to fix these related crises. Even if they wanted to. Which they don’t in this era of gangster capitalism. Nor will “private” charities. Many of which already rely on shrinking pools of government money to do what little they can do to stem the tide of rising poverty.

 

So it’s critical that people in big cities like Boston—especially press and policy makers—pay careful attention to small municipalities like Greenfield. They are canaries in the coal mine of a political economic system that can only be called failing, the less it is able to provide for the growing number of people on the bottom of our societal pyramid.

 

As such, we ignore the Greenfields of our nation at our peril. We must act now to stop the rest of our communities, large and small, from continuing their rolling collapse. A task we can best begin by rebuilding government at all levels to focus on the human needs of all of its denizens. And stop privileging the schemes of the rich and powerful few over the livelihoods of the struggling multitude.

 

Townie is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. His Apparent Horizon column is winner of the Association of Alternative Newsmedia’s 2018 Best Political Column award. Copyright 2018 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GENERAL ELECTRIC FAIL

 

Conglomerate’s woes throw Boston HQ deal contradictions into bold relief

 

November 15, 2017

BY JASON PRAMAS @JASONPRAMAS

 

What a surprise. General Electric is tanking, and the scheme to bring the multinational’s headquarters to Boston is looking worse by the day. And whom shall the public blame if that once-secret deal cut by Gov. Charlie Baker and Mayor Marty Walsh in January 2016 goes south? Potentially tossing away millions in tax breaks and direct aid to a company that has already done massive damage to the Bay State over the past few decades? Readers of the dozen columns I’ve written criticizing the boondoggle will already know the answer to that question. But for those of you who have made the mistake of believing all the massive amounts of PR bullshit that the Boston Globe and other area press have been tossing around about the affair since that time, here’s a bit of a recap.

 

Where to begin? So, the governments of Boston and Massachusetts agreed to shovel tens of millions of dollars at GE in “exchange” for “800 jobs” in a new corporate headquarters campus in the Fort Point district of the Hub. Many of which would simply be transferred from the old headquarters, and most of which would be executive level jobs that will not help Boston’s struggling, underemployed working class.

 

Now there’s a problem. GE’s been losing money all year. According to the New York Times, its stock price had already dropped by 35 percent since January. Then, according to CNBC, the company’s share value dropped another 13 percent this week as of this writing after new CEO John Flannery announced a restructuring initiative—including the one thing investors hate most of all: dividend cuts. Only the second for GE since the Great Depression. So the knives are coming out around the beleaguered behemoth, and it remains to be seen whether some internal reorganization (doubtless costing legions of employees their jobs) and some belt-tightening by its execs will be enough to stop investors from moving to carve the conglomerate up like a Thanksgiving turkey. But let’s not assume the worst just yet.

 

Funny thing about that belt-tightening, though. According to the Boston Herald, cuts are now in store for GE’s still-small local workforce, and construction of the new Fort Point headquarters building was already pushed back two years from 2019 to 2021 in August. The plan is to make do with the two old Necco buildings already being refurbished on the site at first. The PILOT (payment in lieu of taxes) agreement signed by the Boston Planning and Development Agency (formerly the Boston Redevelopment Authority) and the city of Boston guarantees up to $25 million in tax breaks to GE if it provides the much-ballyhooed 800 full-time jobs. But by what date?

 

The discussion around GE moving its HQ to Boston has focused on the corporation creating those jobs by 2024. Herein, then, lies the rub about the PILOT deal: The agreement is framed around GE hiring “approximately 800 employees at the Headquarters Building and the Necco Buildings within eight years of the Occupancy Date.” But that occupancy date is explicitly defined as “the date upon which the Company initially occupies the Headquarters Building.” Which has now been pushed back from 2019 to 2021, according to the Boston Business Journal. So 2024 cannot be the year that GE will need to have 800 employees on its new campus. 2027 would have been the earliest it had to meet that target. And now that’s been pushed back to 2029, given the delay with the headquarters building.

 

Yet it turns out that the PILOT agreement doesn’t actually require 800 jobs to be created. Remember, it starts by stating GE will employ “approximately” 800 people on the Fort Point campus. But further down in the document, in a table explaining the specific tax break the city will actually give the company during each year of the deal, it allows for the creation of as few as 400 jobs in a chart with five tax break tiers between “Job Figure is between 400 and 499” and “Job Figure meets or exceeds 800.” Keeping in mind that the agreement also specifies a “stabilization” period of seven years between 2018 and 2024, during which GE gets $5.5 million in tax breaks no matter what and isn’t required to provide any jobs at all for the first six years. GE is then only required to provide between 400 and 800 jobs from 2024 until the agreement ends in 2037.

 

Job figure table from the GE Boston PILOT agreement
Job figure table from the GE Boston PILOT agreement

 

What’s super puzzling is that agreement first requires the company to start providing annual job figures “from and after” the aforementioned occupancy date. But the agreement already established that it only really has to start meeting any job targets as far out as eight years from the date it occupies its headquarters building. Making the job target requirement trigger as late as 2029, according to current plans. Despite the tax break table in the PILOT agreement using job targets to calculate tax breaks beginning in 2025 based on the 2024 job count.

 

The state, for its part, committed a total of about $120 million to the project. Late last year, GE spent $25.6 million to buy 2.5 acres on the Fort Point Channel that includes the land the existing buildings sit on and the land the new headquarters building will (perhaps) one day occupy from Procter & Gamble. MassDevelopment, part of the Commonwealth’s economic development apparatus, took out a $90 million loan from Citizens Bank—an interesting maneuver worth looking into—using $57.4 million to purchase the two old Necco buildings on the site from P&G, and the rest to refurbish the buildings. The remainder of the state’s “investment” is slated to go to fixing up the area around the site.

 

So, GE is getting basically free rent on the Necco buildings plus free upgrades on abutting public land courtesy of the state. And a big chunk of the taxes it would normally pay over the next 20 years is coming free from the city. Without any real requirement that it actually provide any jobs in Boston for many years, and then only (maybe) 400 jobs by 2029—assuming the headquarters building is built in 2021.

 

Which is the problem with all such erstwhile “economic development” deals in the Bay State. From their origin as a way to help encourage investment in areas of the state that were down on their luck precisely because GE and companies like it moved their manufacturing operations away from cities like Pittsfield, Lynn, and Fitchburg to places without the decent labor and environmental regulation that was in place by the 1970s, they have become yet another way for rich and powerful corporations to get richer and more powerful. Worst of all, such corporations hold all the cards in the deals. If they don’t get lavished with free public money, they can refuse to move their operations here or can leave if they’re already operating in the area. Once they get the cash they’re looking for, they can basically pull out at any time. Or as is the case with GE, they can “alter” the deal Darth Vader-style, leaving our local “Lando Calrissians” like Baker and Walsh to “pray” the deal is not altered “any further.”

 

The Boston Business Journal was correct to point out that GE will get $2.1 million in tax breaks on the Fort Point Complex by 2021—the year that the company now claims it’ll be completing its new 12-story headquarters building on the site. But what if it doesn’t build the new structure at all? It’s not clear. Because the PILOT agreement is pegged to job creation starting as far out as eight years after the headquarters building is built, and then allows for the company providing as few as 400 jobs between 2024 and 2037 rather than the 800 everyone’s been assuming. While not actually demanding any job creation until as late as 2029, making it unclear how the tax break will be calculated between 2025 and 2029 should GE drag its feet for the full eight years. The conditions for the company defaulting on the agreement are also pegged to job creation. Not to the construction of the headquarters building. Oh, and by the way, the PILOT deal only covers the headquarters building and the land the company purchased under and just around it (which the agreement calls the “Headquarters Project”). Not the Necco buildings, now owned by the state. Also, there’s no word about what happens if the company has less than 400 workers in Boston at any point from 2024 to 2037. Do these curious contradictions amount to loopholes for GE to bag the whole deal? It certainly looks that way.

 

The minimum GE will get in tax breaks from the city of Boston over 20 years is $5.5 million by 2024 plus whatever breaks it qualifies for between 2025 and 2037. However, the amount the company actually puts out in annual PILOT payments after 2024 is calculated by a complicated formula based on the taxes that would have been assessed without the PILOT agreement. And the assessed value of the relevant property could change from current projections. So it’s hard to know what the total value of the PILOT deal will ultimately be to GE, other than that it will be a bunch of money… however many jobs it actually creates.

 

But why exactly are Boston and Massachusetts giving a huge company that’s still profitable any money at all? And what happens if GE bails on the scheme by hook (simply running and fighting its PILOT default in court with its vast legal department) or by crook (not building the headquarters building at Fort Point and possibly getting away with delaying the job creation target trigger until the deal ends in 2037)? And what happens if worse comes to worst for GE, and the company actually does collapse?

 

These remain my central questions. And I continue to encourage all of you to ask those and related questions to every Boston and Massachusetts politician you can find. And ask the Globe while you’re at it. They’ve got a loooot of ’splaining to do about their cheap boosterism… which they’ve become awfully quiet about of late. Preferring, it seems, to focus on the next giant company that’s demanding public bribes to come to town, Amazon.

 

A shorter version of this column appears in this week’s DigBoston print edition.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

AMAZON OCTAGON

Mass pols stand ready to fight each other for the right to bribe a multinational

October 10, 2017

BY JASON PRAMAS @JASONPRAMAS

 

At least 17 Massachusetts cities and towns are now preparing to do battle with each other—and hundreds more municipalities nationwide—for the dubious “honor” of “winning” the right to throw enough public money and tax breaks at Amazon to become the site of its new Headquarters 2 (HQ2). Despite the fact that such a “victory” will result in a worse regional housing crisis, provide mainly low-paying unstable jobs with subcontractors to working class natives without college degrees while tossing thousands of good jobs to software engineers from out of state, and give the vast corporation far too much power in state politics.

To prevent those unfortunate outcomes, here’s a non-exhaustive list of local, state, and federal public officials that should be contacted by constituents and reminded of their responsibilities to defend the public interest. Like, immediately. The deadline to submit HQ2 bids to Amazon is Oct 19. Careful readers will note that many of these bids are being pushed hardest by private developers and by “economic development” nonprofits and government offices that are basically run on behalf of private developers. Fancy that.

Local Government

BOSTON

Mayor Marty Walsh is all over this one. Fresh off of colluding with Gov. Charlie Baker to cut a secret deal to lavish tens of millions on General Electric to bring its once-and-future headquarters to the Hub, he’s back to his old tricks with Amazon. Four possible HQ2 sites are being considered, according to the Boston Globe: putative front-runner Suffolk Downs (partially in Revere), Widett Circle in South Boston, Beacon Yards in Allston, and an area adjacent to South Station.

REVERE

At a Sept 29 meeting, the Revere City Council Economic Development Sub-Committee reacted positively to the Suffolk Downs proposal presented by developer Thomas O’Brien, managing director of the Boston-based Hym Investment Group that owns the property. According to the Boston Herald, committee chair and council vice president Councilor Patrick M. Keefe Jr. then called Amazon the “1A plan” for the land.

SOMERVILLE

CommonWealth reports that Mayor Joe Curtatone is working on a proposal that would include buildings along the Orange Line from Assembly Row in Somerville to North Station in Boston. Which is, according to a DigBoston investigative series, perfectly in keeping with his track record of making a big stink when developers come to town, then ultimately giving them exactly what they want.

ABINGTON, ROCKLAND, and WEYMOUTH

Kyle Corkum, CEO and managing partner of LStar Communities, the company developing Union Point—the former US Naval Air Station—is pushing a bid for the property. According to Wicked Local, Weymouth Mayor Robert Hedlund is supportive of the bid. Rockland Selectmen Chairman Ed Kimball said, “Rockland will extend open arms to them and Abington will receive indirect benefits as well.”

HAVERHILL, LAWRENCE, METHUEN, AND NORTH ANDOVER

Haverhill Mayor James Fiorentini, Lawrence Mayor Daniel Rivera, Methuen Mayor Stephen Zanni, and North Andover Town Manager Andrew Maylor are all preparing a joint proposal featuring the former North Andover Lucent site—which I addressed in detail in my Sept 26 column—likely in tandem with other nearby sites.

BILLERICA, LOWELL, AND TEWKSBURY

According to the Lowell Sun, Lowell Mayor Edward Kennedy has said “we should at least take serious look” at the possibility of bringing Amazon to the area. Also, “City Manager Kevin Murphy said he has already directed his staff to begin working with the Middlesex 3 Coalition, an organization of nearby communities, to explore the possibilities.” Wicked Local reports that Billerica selectmen unanimously support the effort. Billerica Community Development Director Rob Anderson also supports the bid. One possible site is Riverview Technology Park at 495 Woburn St in Tewksbury.

NEW BEDFORD

The entire city council sent a letter to Mayor Jon Mitchell enjoining him to support an Amazon bid, according to the New Bedford Standard-Times, and he’s been in touch with Mass Secretary of Housing and Economic Development Jay Ash about pursuing a bid. The city has a 100 acres of a municipal golf course that has been slated for business development.

FALL RIVER

According to the Herald News, Fall River Office of Economic Development (FROED) Executive Vice President Ken Fiola—a key figure behind bringing a huge Amazon warehouse to the city—is pushing hard for the Amazon HQ2 contract but apparently doesn’t get along with Mayor Jasiel Correia II. WJAR-TV reports that his challenger in the upcoming election, Councilor Linda Pereira, is attacking Correia for resigning from the FROED board. So it’s not clear if Fall River will manage to field a proposal.

WORCESTER

The city council is unanimously in support of an Amazon deal but was not initially in agreement about whether HQ2 should be sited in Worcester or Boston. Councilor-at-Large Konnie Lukes has been the most vocal supporter of a Worcester site, pushed for council discussion about the deal, and requested that City Manager Ed Augustus Jr. prepare the application. According to MassLive.com, Augustus and some of the council were initially leaning toward supporting a Boston bid, but the city is now planning an independent bid for the contract. According to Worcester Magazine, “Councilor At-Large Kate Toomey said the south side of Worcester, by the intersection of routes 20 and 146, would be an ideal location” for HQ2.

WESTERN MASS

The Republican reports that Springfield Mayor Domenic Sarno and the entire city council are supporting a bidwith other Connecticut River valley communities (the so-called “Knowledge Corridor”) in Massachusetts and Connecticut. Enfield, Connecticut, is a possible site. The main Bay State booster of the plan is Rick Sullivan, president and CEO of the Economic Development Council of Western Massachusetts.

State Government

GOV. CHARLIE BAKER

The governor said that the state won’t back a specific site and has urged local governments to “go for it.” Strongly in support of spending public money to bring the Amazon HQ2 to Massachusetts. According to the Boston Herald, Baker has recently stated that the Commonwealth’s request to Suffolk Superior Court to order Amazon to provide records for any third-party vendor who “stores or has stored” products in Massachusetts since 2012 was “routine” and shouldn’t affect an HQ2 deal. The order could result in a flood of similar legal actions around the US to collect back state sales taxes—which will probably tick off the tax-shy multinational.

SECRETARY OF HOUSING AND ECONOMIC DEVELOPMENT JAY ASH (D)

An important public servant, though not an elected one. Totally in support of an Amazon HQ2 deal for Massachusetts. In his role as chairman of the quasi-public agency MassDevelopment, he has already overseen a vote “to increase its contract with consulting firm VHB Inc. by up to $200,000 for a technical analysis” in support of the state’s Amazon bids. His bio brags that he “has played a leadership role in the recruitment and expansion of major employers, including Amazon, General Electric, IBM Watson Health, Kronos, and Siemens.”

SPEAKER ROBERT DELEO (D-WINTHROP)

Flacking for the Suffolk Downs site. Completely on board with dumping public money on Amazon and has “said he’s open to legislation that would include financial incentives to draw Amazon to the state regardless of the location,” according to the Boston Globe.

SEN. JOSEPH BONCORE (D-WINTHROP) AND REP. ADRIAN MADARO (D-EAST BOSTON)

Support the Suffolk Downs bid, according to the East Boston Times-Free Press.

SEN. CINDY FRIEDMAN (D-ARLINGTON) AND REP. MARC LOMBARDO (R-BILLERICA)

Support the Billerica, Lowell, Tewksbury bid, according to Wicked Local.

Federal Government

US REP. STEPHEN LYNCH (D-SOUTH BOSTON)

Supports the Weymouth proposal, according to the Boston Herald.

And a Few Cool Kids

REP. MIKE CONNOLLY (D-CAMBRIDGE), SEN. PAT JEHLEN (D-SOMERVILLE), REP. MARJORIE DECKER (D-CAMBRIDGE), AND SEN. JAMIE ELDRIDGE (D-ACTON)

Among the only politicians in the state to speak against spending public funds to “win” the Amazon HQ2 “contest.”

Rep. Connolly of Cambridge put his opinion succinctly on the matter in a Facebook chat to me Monday: “I was asked about it by some Cambridge residents last week and here’s what I told them: ‘I think it’s reasonable for cities and the state to want to be in the discussion, but at the end of the day, when/if I have to vote on something or support a proposal, I am not going to support a neoliberal approach to economic development, so if a deal is on the table I would be looking to scrutinize it in terms of whether it helps the folks who we represent in our communities and in the neighborhoods I represent right now.’”

Massachusetts needs more pols like these. Fast.

UPDATE 10/12/17: LYNN

A reader just pointed me to an article indicating that there is some interest in bringing Amazon to the “City of Sin.” According to The Daily Item, “Mayor Judith Flanagan Kennedy said the city is in no position to compete with Boston, Revere, Lawrence and Worcester to bring the world’s largest e-commerce company’s second headquarters to Massachusetts.” However, City Councilor-at Large and Rep. Daniel Cahill (D-Lynn), Senator and mayoral candidate Thomas M. McGee (D-Lynn), and Charles Patsios—the Swampscott developer who plans to transform the 68-acre former General Electric Co. Gear Works property into a $500 million neighborhood—are all supportive of a Lynn bid.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

AN AMAZON NORTH ANDOVER DEAL?

Sketch of the Merrimack Valley Works plant at North Andover while under construction in 1955

Merrimack Valley pols courting the tech behemoth have forgotten recent history

Sept 26, 2017

BY JASON PRAMAS @JASONPRAMAS

A couple of weeks ago, I criticized the possibility of an Amazon Boston deal—on the grounds that most of the jobs it would provide would be for software engineers, not our struggling local working class. And that allowing a single company to build a 50,000-employee operation here overnight would give it way too much political economic power in our region. However, it’s not just Boston politicians who are hot to dump vast amounts of public funds on the huge multinational. Several other Massachusetts cities and towns are following suit.

Perhaps the strongest proposal of that group of entrants is coming from four municipalities in the Merrimack Valley region of the state: Haverhill, Lawrence, Methuen, and North Andover. They are offering to broker a deal with the owners of the underutilized 1.8 million-square-foot industrial facility called Osgood Landing in North Andover. This could conceivably fit Amazon’s bill, although the site is not located in the midst of a major city. Which the company has made clear is a priority. Also at issue is that Osgood Landing’s owners have been working to build a giant marijuana farm on the site instead. But the siren call of ready corporate cash will likely be enough to change their minds given that they’ve already signaled their support for the new venture.

Lost in most of the media chatter about the drive to “win” the Amazon deal is the fact that Osgood Landing was once a Lucent plant—and the context of its shutdown is completely absent. Lucent was the successor corporation to Western Electric. Which was better known as the old AT&T’s manufacturing division. And the North Andover plant was once Western Electric’s Merrimack Valley Works. Which built the transmission equipment that kept the nation’s phone system going. The company set up shop in Haverhill and Lawrence during World War II—just as the region’s famed textile and shoe industries began to decline. In 1956, it opened the North Andover plant and consolidated its regional operations there, becoming the new dominant industry in the area.

Video: “AT&T Archives: In the Merrimack Valley” [1959] (hat tip to Ryan W. Owen’s website for the find)

The jobs at the Merrimack Valley Works were mostly unionized, and they raised thousands of local families into the ranks of the middle class. But the chaos following the federally ordered breakup of AT&T’s near-monopoly of the US telephone system in 1984 saw the plant’s workforce fall from over 12,000 at the height of the Western Electric era in the 1970sto 7,000 in 1991, to 5,500 under Lucent in 2001 (well into a quick collapse five years after taking over the Western Electric business)… to zero in 2008, after the French telecom multinational Alcatel bought Lucent in 2006 and ordered the facility’s shutdown. The plant itself had already been sold to current owner Ozzy Properties in 2003. Alcatel-Lucent ended up being absorbed by Nokia in 2016.

Ironically, this sad outcome was predicted by local policy experts. In 1991, according to the “History Corner” of the Lucent Retirees’ website, “the Merrimack Valley Planning Commission investigated what the potential loss of … the Merrimack Valley Works might cost the region. The study found that a worst case decline that eliminated the plant’s then 7,000 jobs would cost 15 Valley communities $880 million. Lost supply orders for smaller companies in the area would eliminate another 7,700 secondary jobs.”

That all came to pass by 2008. Compounding the damage already done by the loss of the other 5,000-plus jobs at the plant between the 1970s and the early 1990s. Lucent’s unions slowed but ultimately could not stop the destruction of thousands more good jobs in the Merrimack Valley.

Which highlights the problem of spending public money to attract giant corporations like Amazon. Big companies can change their plans at the drop of a dime. And, without the kind of government regulation and unionization that major companies like AT&T had to operate under between WWII and the 1970s, the promised 50,000 jobs can become no jobs in the blink of an eye. Because who’s to stop an anti-regulation, anti-union company like Amazon from shutting down an operation as fast as it sets it up in this era? No one. No one at all. And, naturally, regions that fall for this “jobs creation” shell game have no plan B.

One would think that political leaders in Haverhill, Lawrence, Methuen, and North Andover, informed by their own regional planners, would remember such history and focus on more sustainable economic development options. After all, the 2013 Merrimack Valley Comprehensive Economic Development Strategy produced by the Merrimack Valley Planning Commission stated, “The region’s best prospects for future economic growth are its local entrepreneurs.” Local entrepreneurs like the Osgood Landing owners, if they choose to start their marijuana farm rather than grab for the brass ring Amazon could offer them. A sustainable “growth” industry if ever there was one that could provide an estimated 2,500 good jobs to the region—two-thirds of which would not require college degrees. But it seems like local residents, perhaps with former Lucent employees in the lead, will now have to remind their elected officials. If not in lobby days and protests prior to an Amazon deal, then definitely at the ballot box come next election should such a disastrous initiative ever actually come to pass.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

STOP THE AMAZON BOSTON DEAL

Stop the Amazon Boston Deal

 

Locals have until Oct 19 to say ‘No Public Bribes to Corporate Scofflaws’

Sept. 12, 2017

BY JASON PRAMAS @JASONPRAMAS

Fresh off of throwing tens of millions of dollars at General Electric, Boston Mayor Marty Walsh and Massachusetts Gov. Charlie Baker are now planning to enter the international horse race to convince Amazon to let the city and the commonwealth shovel vast amounts of public money at it in exchange for building a new second headquarters (“HQ2” for short) here.

But this HQ2 won’t be just any corporate headquarters. No no no. None of this GE business — with maybe kinda sorta up to a piddling 800 jobs at a new Boston HQ at some point. Amazon plans to put 50,000 workers in its new digs. Fast.

Thing is, the bulk of those jobs are apparently slated for software developers. Which, true, our colleges produce in some numbers. But most of the students who train for high-tech jobs are from “outta town.” So the new jobs are not going to benefit our shell-shocked Boston-area working class. If the Seattle experience is any guide, the gigs they’re going to get from the deal will be the same unstable jobs as subcontractors — ranging from cafeteria workers to security guards — that they’re already struggling to survive on now. And those jobs do not “raise” any “boats” in anyone’s fantasy scheme of how capitalist economics works.

For both the city and the state, there’s another big red flag: Amazon proposes to spend $5 billion building a campus of around 8 million square feet. Leaving aside the lack of the necessary 100-acre plot in or near downtown Boston, that kind of build-out is going to place a huge burden on both our metro housing and transportation infrastructures. Yet Amazon is coming on to cities like Boston with hand outstretched. Looking for the tax breaks and direct aid (read: bribes) that all big companies expect when they move to a new location these days. And after starving even more social programs to pay for this latest boondoggle, what are working families going to get back from the huge multinational?

Probably not much. According to the New York Times, Amazon only paid an average local, state, federal, and foreign tax rate of 13 percent between 2007 and 2015 — far less than the official federal corporate tax rate of 35 percent alone, and less than even the 15 percent corporate tax rate that the Trump administration is trying to pass. Given that Boston real estate developers have been allowed to build primarily “luxury” condo complexes in the last many years, vacant units will be quickly snatched up by Amazon employees, and then the remaining downmarket properties will be upgraded by landlords looking to cash in. The result will be even more Bostonians without decent housing, legions more homeless people, and little new tax revenue to pay for the mounting social crisis thus created — or for making the desperately needed repairs and upgrades to our crumbling and utterly underfunded public transportation infrastructure.

Back on the labor tip, Amazon has gone out of its way to crush even the most insignificant union drives at its facilities worldwide since its inception. As when a small group of maintenance and repair technicians at its Middletown, Delaware, facility voted 21–6 against joining the International Association of Machinists and Aerospace Workers after an intense management campaign against the workers. Meanwhile, in Germany, where better labor policies and worker militance have forced Amazon to accept some unionization, management was recently shown to be “using peer pressure” to convince workers to not use their government-guaranteed sick days. No surprise, for a company which has made some of its warehouse workers walk 15 miles a day on a typical shift.

So is this the kind of company we should let state and local government bigs lavish public money on?

Hell no. And there’s one big reason, aside from the above, why we shouldn’t. Allowing a company as large as Amazon to suddenly parachute a huge operation into our midst means it will immediately command an inordinate amount of political and economic power in Boston and Massachusetts. Particularly, the ability to threaten a capital strike in the form of leaving the area if any future demands for public lucre aren’t met.

Once Amazon arrives, it is going to distort the metro political economy so severely that we’ll be stuck with it. The ultimate white elephant.

Which is why any potential Amazon Boston deal must be stopped — with even more finality than the Olympics deal was torpedoed. Fortunately, unlike the GE Boston Deal — that got sprung on Boston and Massachusetts residents after months of secret negotiations — there’s still time to organize a very strong “NO” campaign. The deadline for Boston to get a proposal to Amazon is Oct 19.

Readers have a bit over a month to force Walsh, Baker, and other local pols to stand down on this one. I recommend hitting the ground running.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston. Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

Excerpts from the Town Meeting on Black Male Joblessness

14 April 2008 – 6:25pm
by Jason Pramas

 

News video on the April 4, 2008 Town Meeting on Black Male Joblessness at the University of Massachusetts Boston in Dorchester, MA, USA – commemorating the 40th anniversary of Dr. Martin Luther King, Jr.’s death. The event was sponsored by the Union of Minority Neighborhoods and featured MA State Senator Dianne Wilkerson, Boston, MA City Councilor Chuck Turner, Horace Small of the Union of Minority Neighborhoods, and Brian Corr of the Cambridge, MA Peace Commission. Sarah Ann Shaw (not featured in this video) was the moderator. 10 minutes, 51 seconds.

For more info, check out http://www.unionofminorityneighborhoods.org.

License:
Creative Commons 3.0 BY-NC-SA