ESD approves grants for two Cortland County companies

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Two manufacturers operating in Cortland County are in line for state aid toward expansion projects after Empire State Development’s (ESD) board of directors approved a

Consulting firm to host big data training at SU, Cornell

Health Care, Technology

SYRACUSE — Comrise, a global consulting firm, will sponsor big data training sessions in January at Syracuse University (SU) and Cornell University. The company, based

A New Way to Measure Prosperity: Counting Jobs Destroyed

Opinion, Subscriber Only

Everyone is focused on how many jobs America creates. Every month, we wait breathlessly for the U.S. and state labor bureaus to release the latest data on the economy’s employment status. An army of statisticians labors to analyze every facet: how many new jobs were created, the rate of unemployment, participation of workers in the

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Everyone is focused on how many jobs America creates.

Every month, we wait breathlessly for the U.S. and state labor bureaus to release the latest data on the economy’s employment status. An army of statisticians labors to analyze every facet: how many new jobs were created, the rate of unemployment, participation of workers in the labor force, the average duration of unemployment, the number of hours worked, and the average hourly earnings. The information is then recalculated by a variety of factors, such as age, minority status, and education levels.

The country expends this effort because we all agree that higher levels of employment and lower levels of unemployment are desirable. The assumption is that “full” employment is a requirement in order to generate prosperity.

I agree that employment is an important indicator of the country’s prosperity, but is it the only or the best unit of measure? I suggest we study another indicator: how many jobs are destroyed.

Before you think I am off my medication, let me explain.

In 1942, Joseph Schumpeter, an Austrian economist, popularized the idea that capitalism was based on “… the perennial gale of creative destruction.” That is to say, the free market is constantly churning, because entrepreneurs keep introducing innovations that disrupt, and in many cases destroy, established businesses and their jobs. Society accepts this disruptive process of transformation only because the residents, over time, see the benefits of greater productivity, which leads to higher living standards, new and better goods and services, shorter work weeks, and jobs demanding less physical labor.

The paradox of this creative destruction is that there is no gain without pain. Some individuals are worse off from the forces of change, and not just in the short run. So are corporations. Only five of today’s 100 largest companies were in the same category a century ago. Since 1970, barely half of the top 100 companies are still in the top tier.

What happens to all the labor that is disrupted? The country recycles its labor force from declining economic sectors into those that are expanding. The telecommunications sector is but one example. Remember Lily Tomlin playing Ernestine, the obnoxious telephone operator, on Rowan & Martin’s “Laugh-In” TV show? In 1970, the telecom industry employed 421,000 switchboard operators at a time when Americans made fewer than 10 billion long-distance calls annually. Today, there are 156,000 operators who handle more than 100 billion calls. Technology now allows each operator to handle 1,861 calls per day versus 64 back in 1970. That means more “ringy-dingys” per operator per day and lower costs for consumers.

Think farming. In 1800, it took 90 percent of Americans living on farms to feed a population of 3 million. By 1900, when the country had 90 million people, 40 percent of the population lived on farms. Today, about 2 percent of the population lives on farms and not only feeds 310 million people, but also exports foodstuffs to the rest of the world.

What happened to the switchboard operators and the farmers? What happened to the country’s 238,000 blacksmiths employed in 1910, the 109,000 carriage and harness-makers in 1900, or the 75,000 telegraph operators in 1920? They found work in new industries as electricians, auto mechanics, airline pilots, medical technicians, truck or bus drivers, appliance salespeople, software developers, and webmasters.

Thus, I propose that the U.S. Department of Labor create the “Bureau of Destroyed Jobs,” an office that tracks job destruction as a way of measuring the country’s prosperity. The purpose is to take a long-term view of our prosperity by measuring job and industry churn. This would help to remind the country that our short-term government policies designed to insulate corporations and their workers from change almost always backfire. Instead of allowing inefficient producers to go out of business, government steps in too often to protect them, thus delaying the shift of resources to more productive sectors and adding costs to consumers and, oftentimes, taxpayers.

Government wants the gain without the pain. The irony is that societies that think they can reap the gain of creative destruction without the pain end up experiencing the pain without the gain. Think Jimmy Carter, who thought government could tax its way to prosperity. What we reaped were rising unemployment and inflation, stagnant markets, and high energy prices. Think President Obama, who also wants government to tax and spend us into prosperity. The result is a sluggish economy, workers abandoning the labor force, astronomical debt and deficits, and crony capitalism. Can inflation be far behind?

Society both loves and hates its entrepreneurs. They bring us better things and create jobs. But they simultaneously disrupt the established order and kill jobs. We also can’t seem to accept their pursuit of self-interest — read profit motive — which ignites the progress that makes the rest of us better off.

The country would prosper by establishing a policy where the majority of our taxes go to educating our students and retraining our workers to prepare the labor force to adapt to constant change rather than to spend it on trying to retard the impact of innovation by wrapping a protective net around its established corporations and citizens.

The Bureau of Destroyed Jobs would help us to recognize the good that comes from economic turmoil.

Norman Poltenson is publisher of The Central New York Business Journal. Contact him at npoltenson@cnybj.com

SUNYIT, nfrastructure launch internship program

Health Care, Subscriber Only

MARCY — The State University of New York Institute of Technology at Utica/Rome (SUNYIT) and Clifton Park–based nfrastructure are launching a new program to help develop the state’s information-technology workforce. The program will allow students to work on projects at the nfrastructure Center of Competency in Information Technology (NCCIT) site on the SUNYIT campus. The

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The program will allow students to work on projects at the nfrastructure Center of Competency in Information Technology (NCCIT) site on the SUNYIT campus. The center is a public-private partnership among nfrastructure, the College of Nanoscale Science and Engineering at the University at Albany, and SUNYIT.

The center works on technology projects for local and state government entities, institutions of higher education, and health-care facilities. Nfrastructure designs, builds, and operates technology infrastructure for public and private entities.

Students in the new program at SUNYIT could wind up working on just about anything nfrastructure has in its pipeline, says Larry Delaney, president of the NCCIT.

“Employers don’t just want book smart,” Delaney says. “They want guys and gals that have put their hands on things. They’ve designed networks. They’ve worked in a data center.”

Delaney says he’s not sure how many students will be involved in the program yet, but he is planning to start with two and scale from there. The program will also help SUNYIT students with required senior projects.

Nfrastructure staff members will mentor those efforts, Delaney says.

The effort at SUNYIT is just the beginning of what NCCIT wants to accomplish, he adds. The center also has an office at the University at Albany and a partnership with the Stony Brook University.

“This is the first iteration of something we intend to repeat at lots of SUNY schools,” Delaney says.

Students could work on projects including network monitoring, upgrades, design, equipment installation, and more, he adds.

The program makes sense for nfrastructure as well. One of the company’s priorities is to attract and retain top technical talent, Delaney says.

Working closely with SUNYIT and other schools will give the firm first crack at hiring some bright students. The NCCIT has six employees at SUNYIT. That total could grow to 60 or 70 or more given the pipeline of customer opportunities in place, Delaney says.

Nfrastructure employs more than 150 people companywide.

Students will receive academic credit for the internships and be paid as well, says William Durgin, SUNYIT provost. It’s a terrific opportunity for them to gain experience on projects for actual, real-world clients, he adds.

Students, he notes, are quick to detect projects that are designed by faculty as good academic experiences.

“There is no substitute in terms of engagement for real-world projects,” Durgin says.

Companies running programs like this one often give students backburner projects that accumulate over time, he adds. They’re often initiatives companies want to move forward, but simply don’t have the time or resources to execute.

SUNYIT is working to launch similar internship programs with other area companies, Durgin says. The school is looking to work with M. A. Polce Consulting, an information-technology consulting firm, on a program and wants to explore partnerships in advanced manufacturing and engineering as well.

M.A. Polce is based in Rome and has an office in Syracuse.

Contact Tampone at ktampone@cnybj.com

Northside UP aims to foster entrepreneurship with grant

Health Care, Small Business, Subscriber Only

SYRACUSE — A grant from the Central New York Community Foundation will help the Northside Urban Partnership (Northside UP) launch a business incubation project on the city’s Northside. The project will assist entrepreneurs in starting small businesses in Northside neighborhoods by providing support, education, and lending assistance, according to the foundation. The foundation made the

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SYRACUSE — A grant from the Central New York Community Foundation will help the Northside Urban Partnership (Northside UP) launch a business incubation project on the city’s Northside.

The project will assist entrepreneurs in starting small businesses in Northside neighborhoods by providing support, education, and lending assistance, according to the foundation. The foundation made the $85,000 grant in celebration of its 85th anniversary.

Northside UP beat out 15 other applications. Northside UP is a collaboration of business and community organizations aiming to revitalize the Northside neighborhood of Syracuse. It is led by organizations including St. Joseph’s Hospital Health Center, CenterState CEO, and Catholic Charities.

The Community Foundation-funded project is an outgrowth of work Northside UP has already been doing, says Dominic Robinson, director of Northside UP. One of the organization’s main goals throughout its history has been to develop neighborhood businesses.

But the group was finding that some people it helped faced challenging barriers to success, including lack of business knowledge and basic education. Many Northside residents are recent immigrants or refugees and their ideas were good, Robinson notes.

But their lack of experience was a major obstacle.

“It really prohibited them from pursuing those ideas any further,” Robinson says.

Others the group worked with were able to get businesses off the ground, but then needed lots of help after the fact dealing with zoning issues, permitting problems, and basic financial reporting.

The new grant will allow Northside UP to establish a formal program that will allow the group to select participants with the best chance for success. Participants will go through an intensive training program over several weeks that will provide a grounding in business basics and entrepreneurship and help them refine their ideas, Robinson says.

The plan is then to help participants launch their business in an incubator setting and continue to provide them with counseling and support as they get their ventures off the ground. Launching first in an incubator will allow participants to determine whether their ideas are truly viable, Robinson says.

Plans are in place for a pilot program this spring with three to five participants, who will incubate their companies at the Central New York Regional Market and Downtown Farmers’ Market in Syracuse this summer. Northside UP eventually wants to open a marketplace for program participants on the Northside, Robinson says.

After the pilot program, the organization will launch a larger version next summer with seven to 12 participants. The goal is to run two to three program sessions per year, Robinson says.

Although Northside UP has been working on developing local businesses for years, the new program is a big step forward.

“There really are needs beyond what we’ve been doing,” Robinson says.

The Community Foundation is a charitable foundation with assets of more than $130 million. It awards close to $6.7 million in grants to nonprofit organizations annually.

Northside UP’s application stood out for the level of collaboration it involved, says John Eberle, vice president for grants and community initiatives at the Community Foundation. Some partners on the project include Syracuse Cooperative Federal Credit Union, the Tech Garden in downtown Syracuse, and ProLiteracy.

Many of the residents on the Northside have incredible skills and creative ideas they could transform into vibrant businesses with a little help, Eberle adds.

“The idea of helping create pathways for entrepreneurs to start businesses and create jobs — that was just really exciting,” he says. “It really resonated with us.”

Contact Tampone at ktampone@cnybj.com

Edward Audi’s move to Stickley president part of ‘gradual handoff’

Manufacturing & Engineering, Small Business, Subscriber Only

MANLIUS — The recently appointed president of L. & J.G. Stickley, Inc. says his new seat at the furniture company is part of a transition from one leadership generation to the next. Edward Audi became the Manlius–based wood and upholstered furniture manufacturer’s president in a move announced to employees Dec. 1. He had been the

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MANLIUS — The recently appointed president of L. & J.G. Stickley, Inc. says his new seat at the furniture company is part of a transition from one leadership generation to the next.

Edward Audi became the Manlius–based wood and upholstered furniture manufacturer’s president in a move announced to employees Dec. 1. He had been the company’s executive vice president and president of its Stickley International division.

He takes over a president’s role previously held by his mother, Aminy Audi. She will continue to be Stickley’s CEO and the chairman of its board of directors. The Audi family owns 100 percent of the company.

“It’s a planned gradual handoff from my mother to the next generation,” Edward Audi says in an interview. “Over the past five years, my mother and I have worked very closely on all major decisions at Stickley. And this is just a natural progression with additional responsibilities for me in manufacturing, product development, and human resources.”

Audi says he will also take on more strategic-planning duties. The company does not share revenue totals, but it hopes for “double-digit” percentage growth, he says.

Stickley is working on developing a contract and hospitality division focused on four-star and five-star hotel properties, along with increasing its institutional business. That follows the creation of its Campus Collection, which it started in 2011 when it furnished the State University of New York College of Environmental Science and Forestry’s first dormitory, Centennial Hall, in Syracuse.

Stickley is already heavily involved in custom design for hotels, according to Edward Audi. But the company isn’t ignoring its retail business, which operates as Stickley, Audi & Co. It plans to open between five and 10 new stores in the next few years.

The new stores will come in regions where Stickley already operates, he says. The company currently has 14 retail locations in New York, New Jersey, Massachusetts, Connecticut, Pennsylvania, North Carolina, and Colorado.

“The contract division represents, I would say, the biggest growth opportunity for Stickley,” Audi says. “That would not interfere with our extremely important residential business.”

Stickley is currently hiring for manufacturing positions at its 425,000-square-foot manufacturing facility at its headquarters at 1 Stickley Drive in Manlius. Audi would not disclose the exact number of open positions, but he says the company has about 1,000 employees in Central New York. It employs roughly 1,400 companywide.

The recent recession has been difficult for the entire furniture industry, Audi says. He believes conditions are slowly improving, however. And he points to the Audi family’s track record with employees since it purchased Stickley in 1974.

“What I’m most proud of is our track record of never having had any layoffs in almost 40 years,” he says. “We had to reduce hours at one point. And I want to publicly thank our employees for their patience and hard work through those difficult times.”

Edward Audi also gives credit to his mother for guiding the company through those tough years.

“She has certainly earned the right to smell the roses and enjoy some good times with book club, which is a group of friends she really enjoys being with,” he says. “She’s done a tremendous job navigating these uncertain times and bringing Stickley through this recession. I can’t ever imagine her not being involved in the business.”

Aminy Audi expressed confidence in her son in a news release.

“His deep appreciation for Stickley’s heritage and for our long-term commitment to our dealers and customers, combined with his vision, passion, and innovative spirit, will help him take the company to the next level,” she said. “During his tenure at Stickley, Edward has worked in almost every department and has become very familiar with every aspect of the business. He is well prepared for this new leadership role and has the support of everyone at Stickley.”

In addition to Manlius, Stickley also has manufacturing operations in Archdale, N.C. and Vietnam.

Contact Seltzer at rseltzer@cnybj.com

Dependable Disposal testing truck to help it pick up and grow

Small Business, Subscriber Only

VAN BUREN — A Central New York trash hauler is in the midst of a pilot program testing a new truck that’s less stressful on its pilot. Dependable Disposal, headquartered at 6948 Herman Road in Van Buren, started sending an automated split-body vehicle on some of its residential routes in November. The truck uses a

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VAN BUREN — A Central New York trash hauler is in the midst of a pilot program testing a new truck that’s less stressful on its pilot.

Dependable Disposal, headquartered at 6948 Herman Road in Van Buren, started sending an automated split-body vehicle on some of its residential routes in November. The truck uses a mechanical arm to pick up recycling and trash receptacles and empty them into separate compartments for disposal or recycling.

That means a driver can operate the truck alone without having to constantly climb in and out of its cab, cutting the potential for injury. It could also allow Dependable Disposal to add more routes without having to take on the expense of rapid hiring.

The company currently operates some routes with two-man crews, each of which is made up of a driver and a laborer dumping bins. It also has routes served by lone employees who both drive and jump out of their trucks to dump bins.

No employees are in line to lose their jobs because of the new truck, according to Dependable Disposal. The automated process is intended to be better for both workers and customers, says Steve Morgan, owner and president of Dependable Disposal.

“It’s more convenient for the customer and much safer from the collection standpoint,” he says.

Convenience for customers stems from the fact that Dependable Disposal provides each customer being served by the new truck with two containers — one for recycling and one for trash. The containers come in 35-gallon, 65-gallon, and 95-gallon sizes, which are much larger than the standard “blue bin” Onondaga County recycling receptacles, Morgan says. And they’re lidded, keeping bottles and papers from blowing away when the receptacles are on the curb.

Customer feedback has been largely positive, according to Morgan. A few believe the 35-gallon containers are too large, but the company has actually picked up some new customers because of the system, he continues.

“It’s allowed us to differentiate ourselves from our competitors,” Morgan says. “None of our other competitors are offering two containers. They’re offering the trash container, but not one for recycling.”

The automated split-body truck is a significant investment. Purchasing it and its compatible containers cost a total of $350,000, Morgan says. Dependable Disposal paid for the vehicle using its own cash, along with financing from Lyons National Bank.

Morgan wants to continue the vehicle’s pilot program for another few weeks before he decides whether to add similar trucks in the future.

“We’ll probably look at it through January and then make that determination,” he says. “We want to see how the holidays go.”

The truck serves routes with a total of about 2,000 residential customers. It is one of 22 vehicles at Dependable Disposal and Morgan Rubbish Removal, a sister company Morgan owns that focuses on the commercial market.

Both companies are headquartered in 16,000 square feet of space at 6948 Herman Road. Together they employ 32 people, which is up six in the past year.

The hiring came because of a municipal contract with the town of Camillus, Morgan says. Dependable Disposal also has a municipal contract with the town of Geddes. It and its sister company serve residential and commercial customers in Onondaga County. Much of their business is in regions to the west of Syracuse, although they are also expanding in Cayuga County.

Morgan anticipates keeping employment levels steady over the next year. He declines to share specific revenue totals, but anticipates growth of about 5 percent.

“We’re always adding front-load accounts — that’s our commercial side,” he says. “Every month we’ll get three to five accounts.”

Contact Seltzer at rseltzer@cnybj.com

Revolving loan fund to aid rural small businesses

Small Business, Subscriber Only

Program includes SBDC at OCC providing technical support to loan recipientsSYRACUSE — A federal grant will help support a new revolving loan fund for small businesses in rural parts of the greater Syracuse area. The Central New York Regional Planning and Development Board applied for $500,000 from the U.S. Department of Agriculture to fund the program.

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Program includes SBDC at OCC providing technical support to loan recipients

SYRACUSE — A federal grant will help support a new revolving loan fund for small businesses in rural parts of the greater Syracuse area.

The Central New York Regional Planning and Development Board applied for $500,000 from the U.S. Department of Agriculture to fund the program. The loan fund will get $400,000, with the rest of the money going toward technical support for loan recipients from the Small Business Development Center (SBDC) at Onondaga Community College (OCC).

Applicants must come from rural areas in Onondaga, Oswego, Cayuga, Cortland, or Madison counties. The program is specifically targeted at very small firms with fewer than 10 employees, says Michael Rosanio, regional loan manager for the planning and development board.

The maximum loan amount is $50,000, which can cover up to 75 percent of a project’s cost.

“There’s generally kind of a lack of money for small rural businesses all in all,” Rosanio says.

The loans will go toward actions like equipment purchases or they’ll help provide working capital, he adds. Loan terms will generally be limited to seven years or less so major construction projects or real-estate transactions aren’t in the cards.

The goal, Rosanio adds, is to focus on companies that are key pieces of their local communities.

The region’s small villages are important economic assets, he notes. But most of the area’s economic-development efforts focus on Syracuse as the region’s urban core.

The loan fund is a way to help tap into the potential of small businesses in less-populated areas.

“We believe they’re important economic and cultural and social assets in our region,” Rosanio says. “This sort of program could help get economic activity going in those areas again.”

Banks, Rosanio adds, don’t often provide loans at the amounts this program will support. They’d rather see a business owner tap into home equity or open some other line of credit for smaller projects, he says.

“They don’t do smaller commercial loans,” he says. “A lot of these [small businesses] are pretty tapped out. They’ve already tapped into their home equity and their savings.”

Other loan funds sometimes have strict job-creation requirements that very small firms cannot meet, he adds. Worthwhile projects end up falling through the cracks as a result.

The SBDC will provide one-on-one counseling for recipients of the loans. Recipients will also be required to attend the center’s 20-hour class on business basics.

Counselors could work with the business owners on developing a business plan or marketing strategy, depending on what they need, says Joan Powers, the SBDC’s assistant director and a certified business adviser. The center is also developing a workbook targeted specifically at marketing businesses in rural areas.

The SBDC will be able to provide companies some help with market research as well by providing access to the State University of New York research network, Powers says. The businesses will have access to information on trends and various demographic statistics that could help them refine their strategies.

Counselors will also help business owners work on projections to determine if their companies are financially viable.

Contact Tampone at ktampone@cnybj.com

2012: The year that was in Central New York business news

Subscriber Only

The past year in Central New York business news featured a spate of expansion projects and mergers and acquisitions. The Business Journal also brought you news of business consolidations, moves, key new executive hires, and a whole lot more. Below is a month-by-month recap of the year that was in Central New York business news,

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JANUARY

In January, we told you about the latest expansion for Eric Mower and Associates (EMA). The Syracuse–based firm combined with Cincinnati–based advertising agency Strata-G Communications. The move brought EMA more than 35 people and $35 million in capitalized billings. Financial terms of the deal weren’t disclosed. EMA also has offices in Atlanta, Buffalo, Rochester, Albany, and Charlotte, N.C. The company employs 215 people and generated estimated capitalized billings of $210 million for 2011.

The first month of 2012 also brought news of a new three-year contract for Community Bank President and CEO Mark Tryniski. The deal pays a base salary of $620,000 and took effect Jan. 1. It expires Dec. 31, 2014. Tryniski’s previous employment agreement ran from March 18, 2009 to Dec. 31, 2011 and paid a base salary of $454,000.

Tryniski is also eligible for incentive pay. His total pay in 2010 was more than $1.3 million, including bonuses and stock-based compensation, according to a filing with the U.S. Securities and Exchange Commission.

We told you as well in January about the sale of East Syracuse Chevrolet. Sidney Greenberg sold the car business to Gino Barbuto, an employee of East Syracuse Chevrolet for 25 years. Barbuto had been an operating partner, owning 15 percent of the dealership, since 2010. He had been its general manager since 2009 and had been discussing an ownership change with Greenberg for about five years.

FEBRUARY

February brought news of an acquisition for Tompkins Financial Corp. (NYSE Amex: TMP). The Ithaca–based community banking company closed its deal for VIST Financial Corp. (NASDAQ: VIST) of Wyomissing, Pa. on Aug. 1.

The $86 million deal brought Tompkins a presence in southeast Pennsylvania. The acquisition gave Tompkins Financial $5 billion in total assets, $3.8 billion in deposits, $2.9 billion in loans, and 67 branches in Pennsylvania and the Central, Western, and Hudson Valley regions of New York. The company also owns insurance and financial advising subsidiaries.

During the month, we first reported on job cuts at Anaren, Inc. (NASDAQ: ANEN). The company has reduced its workforce of 1,000 employees by 19 percent since July 2011, saving about $6.6 million on salaries and benefits. Anaren has locations in the Syracuse area, New Hampshire, Colorado, and China. The firm develops and manufactures components and subsystems for applications in sectors including satellite communications, defense, and wireless communications.

We also learned in February that Aspen Athletic Clubs would open a location in downtown Syracuse. The downtown club, Aspen’s third, opened in Onondaga Tower, the former HSBC Tower, at 125 E. Jefferson St. The 6,000-square-foot space includes cardiovascular equipment such as treadmills and elliptical machines, free weights, strength-training resistance machines, and a 10-person spinning room.

MARCH

In March, we learned Varian (NYSE: VAR) agreed to purchase privately owned InfiMed, a developer of medical-imaging hardware and software, for $15 million, plus payments based on the sales of InfiMed products over the next two years. The transaction included InfiMed’s headquarters at 121 Metropolitan Park Drive in Salina.

Varian manufactures medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, and brachytherapy. It supplies tubes and digital detectors for medical, scientific, and industrial X-ray imaging.

InfiMed employed about 60 people at the time of the announcement.

We also reported on the purchase of the Learbury Centre at 329 N. Salina St. by Syracuse Behavioral Healthcare (SBH). The purchase gave SBH, which provides treatment and rehabilitation services for people with drug and alcohol addictions, a new home for its Syracuse outpatient clinic. In 2013, the nonprofit organization plans to relocate its administrative headquarters to the newly acquired building.

Finally in March, we told you about the acquisition of Watertown–based Sovie & Bowie CPAs, P.C. by Bowers & Co. CPAs, PLLC of Syracuse. Bowers was looking to increase its presence in the North Country.

APRIL

In April, The Business Journal reported on expansion plans at MicroGen Systems, Inc., winner of the $200,000 grand prize in 2012’s Creative Core Emerging Business Competition. The company, based in Ithaca, planned to add four to five new employees in 2012 to its staff of five. MicroGen is commercializing a chip-sized power generator that can transform subtle vibrations into energy. The product will be used initially in commercial and industrial monitoring. The company closed later in the year on an initial round of $2.6 million in financing.

We also told you during April about a new regional strategy to double exports in the Syracuse metro area developed by CenterState CEO in a partnership with the Brookings Institution. Plans call for increasing export activity among the region’s top exporters, focusing on small and mid-size companies, and expanding service exports.

We reported on a new expansion at St. Joseph’s Hospital Health Center in Syracuse as well. The $140 million project will add more than 181,000 square feet at the hospital. It will add new operating rooms, intensive-care units, private patient rooms, and more.

MAY

In May, we told you about the relocation of Burdick Chevrolet to the Driver’s Village campus. The dealership moved from its former home in Salina to the complex in Cicero. Roger Burdick, president of Driver’s Village, acquired his Chevy dealership from Jeffrey Crouse when it was known as Bresee Chevrolet in March 2011. Burdick Chevrolet shares space at Driver’s Village with GMC and Buick dealerships. Driver’s Village renovated the space for about $2 million to meet new General Motors brand image standards.

We also reported in May on the closing of First Niagara Financial Group’s acquisition of HSBC’s upstate New York branch network. The deal closed May 18 and branches across Upstate reopened May 21 as First Niagara locations. First Niagara leaders said in the wake of the closing that it could look to open more branches in Central New York, where the bank did not achieve as much branch density as it did in some other markets.

We told you about growth at Bankers Healthcare Group in May. The private-equity corporation originates, funds, and places loans to licensed health-care professionals. The company operates in 43 states and serves 50,000 clients. The firm has reached $1 billion in loans since it launched in 2001. Although headquartered in Florida, the company’s CEO is located in Syracuse and a number of the firm’s operations take place here.

JUNE

In June, The Business Journal reported on the sale of the Palmerton Group, a DeWitt–based environmental consulting firm, to Norwood, Mass.–based GZA GeoEnvironmental, Inc. GZA is an environmental and geotechnical consulting firm. It planned to operate the Palmerton Group as a wholly owned subsidiary that would retain its own name and offices. The Palmerton Group’s growing workload came in its oil and gas practice areas, as well as its other specialized areas, like sediment management, according to the company. It had 18 employees at the time of the acquisition and GZA planned to retain all of them.

A second acquisition we covered in June was Berkshire Hills Bancorp’s (NYSE: BHLB) $132 million deal for DeWitt–based Beacon Federal Bancorp. The deal closed in October and Berkshire eliminated 11 of the 130 jobs at Beacon Federal.

Berkshire Hills, based in Pittsfield, Mass., now has assets of $5.5 billion and 73 branches in Massachusetts, New York, Connecticut, and Vermont. Berkshire Hills, parent of Berkshire Bank, first entered the Central New York market in 2011 with its acquisition of Rome Savings Bank.

Finally in June, we told you about the formation of the CenterState Chamber Alliance. Syracuse–based CenterState CEO and the Mohawk Valley Chamber of Commerce in Utica formed the group, which is aimed at sharing events, programs, advocacy efforts, and best practices. The Cayuga County Chamber of Commerce joined the alliance later in the year.

JULY

The second half of the year started with local fallout from the U.S. Supreme Court’s June 28 decision to keep nearly all of the 2010 federal health-care reform law intact. Central New York’s medical and business community reacted to that decision in our July 6 issue.

“Most of the provisions of the law take place over time,” said Dr. Paul Kronenberg, president and CEO of the 506-bed Crouse Hospital in Syracuse. “We’re not going to really completely understand this bill and its unintended and intended consequences until we have a better understanding of how these things will become operational.”

Experts anticipated the ruling’s effects trickling down to companies with 50 or more full-time employees. Those firms needed to start laying the groundwork for offering health insurance by 2014 or risk paying a penalty under the law’s employer mandate, according to Hermes Fernandez, a health-law attorney at the Albany office of the Syracuse–based law firm Bond, Schoeneck & King, PLLC.

“I think the largest piece now is, how do employers get out in front, how do they get lined up with the mandate, and how do they get their coverage done?” he said. “How do they make those decisions to provide coverage or pay the tax penalties?”

AUGUST

A familiar face returned to Syracuse in August, as Nick Dereszynski came back from Seattle to lead Brown & Brown Empire State. The insurance agency headquartered at 500 Plum St. in Syracuse reintroduced Dereszynski as its president Aug. 2. He had been its chief from 2005 to 2011 before relocating to Washington State to become regional vice president for Brown & Brown Empire State’s Florida–based parent, Brown & Brown, Inc. (NYSE: BRO).

Dereszynski stepped back into the Syracuse agency’s leading role while also retaining the title of regional vice president at its parent. The dual positions will give him better access to Brown & Brown leadership, he said.

The comeback would coincide with hiring, Dereszynski vowed. Brown & Brown Empire State employed 95 people in three offices in Syracuse, Endicott, and Clifton Park, but its returning leader pledged to recruit an unspecified number of what he called high-quality candidates. He also declined to rule out acquiring other firms in the future.

The Business Journal also reported on Syracuse–based Sutton Real Estate acquiring Midtown Plaza in Oswego. Sutton Real Estate will manage and lease the property for the new owner, SRE-Midtown Acquisitions, LLC. The 68,000-square-foot retail center is in the heart of Oswego, according to Sutton.

The building includes two floors of retail and office space including a Rite Aid Pharmacy, Joanne Fabric, The Green Planet Grocery, New York State Off Track Betting, and Oswego County Opportunities.

Sutton is involved in other projects in Oswego, including rehabilitation of the former Seaway Supply Building into apartments. The firm also manages the Stevedore Building for another development group. The firm has found Oswego a good place to work, Sutton Real Estate President Louis Fournier says. Support from city and county economic-development officials is a big reason, he adds.

SEPTEMBER

Restructuring at Skaneateles Falls–based Welch Allyn headlined the region’s business stories in September. The medical-device manufacturer said Sept. 10 that it planned to cut its global workforce by 10 percent over three years. At the time, it employed 2,750 people in 26 different countries.

The privately owned company’s 350,000-square-foot headquarters at 4341 State St. Road in Skaneateles Falls will dodge most of the job reductions, Welch Allyn President and CEO Steve Meyer told The Central New York Business Journal for our Sept. 14 edition. The headquarters, home to 1,300 employees, was in line to lose 45 positions. None of them would be manufacturing jobs, he said.

A 2.3 percent federal tax on the sale price of medical devices in the United States helped spur the changes, according to Welch Allyn. Weakness in the European economy also played a part, it said.

Welch Allyn would release details about its restructuring in Europe later in the year. The company will locate both a new Europe and Middle East regional headquarters and an operations center near Amsterdam, Netherlands, it said Dec. 10. Some business functions will move there from its facility in Navan, Ireland. Welch Allyn GmbH & Co. KG operations currently in Germany are also slated to move to Tijuana, Mexico.

OCTOBER

October brought news that Norwich–based NBT Bancorp, Inc. (NASDAQ: NBTB) planned to acquire Alliance Financial Corp. (NASDAQ: ALNC) of Syracuse in a $233.4 million deal. The banks expect the transaction to close early in 2013.

Alliance executives felt compelled to move toward an acquisition because of new regulations coming after the financial crisis, its chairman, president, and CEO, Jack Webb, said in our Oct. 12 issue. The rules would drive staff hiring that wouldn’t generate more revenue, he continued before explaining that the sale to NBT will create a broader base for sharing regulatory costs. The sale will also allow the bank to compete on more loans, particularly commercial loans, he added.

The deal gave NBT a way to enter the Syracuse market, something it had been searching for, according to the bank’s president and CEO, Martin Dietrich.

Details about the acquisition’s staffing impact would come out early in December. About 100 jobs will be cut from Alliance’s Syracuse headquarters and its operations center in Oneida once the acquisition is complete. Alliance currently has 358 employees.

In our Oct. 19 issue, we reported on 40 Below, a Syracuse–based young professionals group, launching Syracuse Coworks. It’s a co-working space that provides low-cost, professional office space at the Tech Garden in downtown Syracuse. The 1,500-square-foot space, located at the Tech Garden, has enough room for up to 25 tenants. Membership levels range from a $15 rate for drop-ins to $225 per month for full tenant members. Amenities available at different membership levels include wireless Internet access, printing services, and access to conference rooms.

NOVEMBER

Tessy Plastics Corp. is already working to expand a facility it built in 2010, we told you in our Nov. 2 issue. The plastic component and packaging manufacturer plans to spend between $5.4 million and $8 million to add nearly 100,000 square feet of warehouse space to a 90,000-square-foot building on its headquarters campus at 488 Route 5 in Elbridge. Construction could finish as early as next June.

The structure set for expansion is Tessy’s “south” building. It is one of three on the Elbridge campus, along with “east” and “west” plants of about 200,000 square feet each. Tessy also operates a 270,000-square-foot warehouse and assembly location in the town of Van Buren.

It expects to hire 30 new workers once the addition is complete. The company employed about 820 workers in Central New York before the expansion. About 100 of those workers were temporary. Central New York revenue totaled $180 million at Tessy in 2011. The company generated about $220 million between New York locations and sites in Lynchburg, Va. and Shanghai, China. It expected to grow sales by 10 percent in 2012.

In our Nov. 23 issue, we reported on ITT Corp. (NYSE: ITT) adding 75,000 square feet of new manufacturing and research and development space at its Seneca Falls site as the company’s business in the oil and gas sector expands.

The Seneca Falls location is the headquarters for ITT’s industrial process business, which provides engineered valves, monitoring and control equipment, and aftermarket services and parts in a range of industries. The business also includes ITT’s Goulds Pumps brand, a line of industrial pumps and the focus of the expansion in Seneca Falls, where Goulds is based. ITT acquired Goulds Pumps in 1997.

The existing facilities in Seneca Falls simply weren’t designed to manufacture the larger pumps ITT makes for the oil and gas industry, ITT officials say. The expansion of manufacturing space will provide needed room for the business.

DECEMBER

Another plastic manufacturer’s expansion topped the news at the start of December. Currier Plastics of Auburn shared details about its 55,000-square-foot addition, already under way for several weeks.

Construction, which will almost double the company’s headquarters at 101 Columbus St. to 120,000 square feet, had been delayed since late 2011 as Currier Plastics sought state aid. The Central New York Regional Economic Development Council recommended $1 million in Excelsior tax credits and a $750,000 capital grant tied to the project in 2011, but the state only awarded tax credits.

Currier Plastics then looked for ways to close the $750,000 funding gap. Empire State Development eventually gave the project an Economic Transformation Grant of that size in May, allowing work to enlarge the building to start late this fall.

The 55,000-square-foot expansion is part of a $21 million project that includes new equipment to be purchased over five years. Work on the larger facility could wrap up by the end of February.

Aspen Athletic Clubs stretched its footprint for the third time this year with a Dec. 1 acquisition of Fitness Forum Health Club in DeWitt. The move gives Aspen its fifth location in 24,000 square feet at 6800 E. Genesee St. — its first club to the east of Syracuse. It also takes Fitness Forum out of the health-club field, leaving the company to focus on its 28-clinic physical-therapy business.

It is the first time Aspen has grown through an acquisition. The company launched its two other new locations in 2012 from scratch. It started a 30,000-square-foot club at 3440 W. Genesee St. in Camillus in September, a few months after opening a 6,000-square-foot location at 125 E. Jefferson St. in downtown Syracuse.

Contact The Business Journal at news@cnybj.com

CDI hoping to grow after starting HIPAA group in 2012

Health Care, Subscriber Only, Technology

DeWITT — Cyber Defense Institute, Inc. (CDI) has received plenty of interest since it set up a HIPAA security division about nine months ago. The division carries out compliance audits, risk assessments, vulnerability assessments, and penetration testing to help medical organizations conform to security rules that are part of HIPAA. That’s the acronym for the

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DeWITT — Cyber Defense Institute, Inc. (CDI) has received plenty of interest since it set up a HIPAA security division about nine months ago.

The division carries out compliance audits, risk assessments, vulnerability assessments, and penetration testing to help medical organizations conform to security rules that are part of HIPAA. That’s the acronym for the 1996 Health Insurance Portability and Accountability Act, a federal law that established standards for securing electronic health information, among other things.

“We’ve been doing these kinds of assessments for several years,” says James Shea, co-founder and CEO of CDI. “We decided to put more resources into it and focus more on it.”

There’s a reason CDI, which also offers computer-security training, consulting, and professional services for governments, the military, and corporations, decided to invest more in its HIPAA compliance services this year. The field has been garnering more attention from medical providers because of another piece of federal legislation, the 2009 Health Information Technology for Economic and Clinical Health Act, better known as the HITECH Act.

“The HITECH Act kind of put some more teeth into HIPAA in terms of penalties and fines,” Shea says. “It tightened the regulations a bit.”

CDI’s HIPAA Security Division targets medical practices of different sizes, although those with about 25 employees seem to frequent it, he adds. The division typically performs risk assessments and vulnerability assessments simultaneously.

“One is more of a management questionnaire, and the other, the vulnerability assessment, is a very technical process,” Shea says. “We go in and scan their whole network.”

To establish its HIPAA Security Division, CDI hired one full-time employee dedicated to assessments and penetration testing. The business has been growing since then, according to Shea, although he declines to share specific revenue totals for the division or CDI. The company targets 10-percent revenue growth every year, he says. Shea is hoping to add more employees in the future, but stopped short of sharing specific goals.

The new HIPAA Security Division isn’t the only change at CDI this year. This spring, the company relocated from Syracuse University’s CASE Center to a new headquarters at 6647 Old Thompson Road in DeWitt.

Moving doubled CDI’s space, Shea says. The firm had 2,000 square feet at the CASE Center and now has 4,000 square feet. Midcourt Builders Corp. owns the building where CDI now leases space, according to records from Onondaga County’s Office of Real Property Tax Services.

“We wanted room to expand, and there was no more room at the CASE Center,” Shea says. “It was a good location for us for a couple of years.”

CDI employs three people full time, including Shea. It has five employees total, including contractors.

Shea co-founded the company in November 2009, along with Carlos Villalba. Both men had previously been with Syracuse University’s Center for Business Information Technologies (CBIT) and founded CDI shortly after CBIT closed in 2009.

But Villalba is no longer with CDI, according to Shea. He departed about a year ago to move to Phoenix, Ariz.

So about 10 months ago, Shea added a new partner, Richard Garza. Garza had been with CDI as an associate before becoming a partner in the business, according to Shea.

Another change CDI underwent in the last year was the closure of its office at Griffiss Institute in Rome. That office, which CDI launched at the end of 2010 by staffing it with Syracuse–based employees, closed in December 2011 due in part to a new program at Mohawk Valley Community College, Shea says.

“We were primarily doing training over there,” he says. “Mohawk Valley Community College got a grant to do cyber-security training for free. That kind of knocked us out of there. It’s tough to compete against free.”

CDI’s business strategy has not changed, however.

“We’re still teaching security classes,” Shea says. “We’re still doing audits and penetration testing for corporations of all kinds.”

Contact Seltzer at rseltzer@cnybj.com

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