Business

We here at The Batavian heard from multiple sources over the past few days that the St Nicholas Social Club of Batavia had been closed down. We spoke this morning with Tim Walsh, a member who was on site at the Swan Street social club. Walsh is the current club manager.

When asked if the club was closed, Walsh replied: "No, not at all."

"It's mostly been rumors from disgruntled employees who were let go," said Walsh of all the talk that the club was shut down. The family that had been in charge of the place for the past ten to twenty years or so had been let go, he said. It's likely that they were responsible for spreading the rumors. Walsh figured it was a board decision to let them go. "It was time for a change."

St Nick's, as it's more commonly known, has been around since at least the 1950s, said Walsh. It's a membership-only Italian social club, in his description.

"We have 1,100 members," said Walsh. "We're trying to get most of them to come in and patronize the place. It's tough times right now."

"Friday nights we knock 'em dead here," he added. "We're open for lunch Monday through Friday, and for dinner on Wednesday or Friday. Lunch and dinner is not restricted to members. Friday nights are our busiest night each week."

Only members and their friends, however, can drink alcohol at the club because of state regulations. St Nick's also has a karaoke night once a month and hosts "a lot of benefits," he said.

"This is the best club in town," said Walsh. "Just about everyone in town knows we're here."

Libertarian blogger/columnist Megan McArdle has deep roots in Western New York.

I love western New York, which may be the most beautiful place on earth.  I love the old cities, the Victorian shells that whisper of much happier days, and the broad, rolling hills, and the broad flat accents of the people who live on them.  I love waterfalls softly falling downtown and the Buffalo City Hall.  I love the place as you can only love somewhere that your family has been living for 200 years.  I would save it if I could.

But I can't save it.  Pouring government money in has been tried . . . and tried, and tried, and tried.  It props up the local construction business, or some company, for a few more years, and then slowly drains away.  Western New York has been the lucky recipient of largesse from a generous federal government, a flush state government, and not a few self-made men with happy memories of a childhood there.  And still, it dies.

Megan's post is arguing against using taxpayer money to stave off the failure of the Big-3 automakers in Detroit.

It's sounds like, though, she is against any number of government programs to help businesses start and grow, and there's a libertarian case to be made that government props get people overly dependant on handouts, killing entrepreneurial spirit

But what I really thought about as I read her piece was how the businesses that once employed so many people in Buffalo, Rochester and Syracuse, as well as Batavia and LeRoy, didn't get their starts because Congress allocated a wad of cash to finance factories and office complexes.

These businesses got up and running because of the energy and vision of entrepreneurs -- often men, and some women, with little means, just an idea and the determination to see it become something worthwhile. They didn't look around Western New York and see obstacles or excuses. They saw opportunity.

WNY is a great place to raise a family and run a business. What's going to save it isn't government programs, but a new generation of entrepreneurs.

Batavia is doubly blessed because it already has a model for building new businesses with a track record of success -- the Harvester Center -- Joe Mancuso's sacred structure of entrepreneurship. To this day, as we reported yesterday, the Mancuso Business Development Group is already leading the way in helping new businesses get started.

I've toured the Harvest Center -- there is plenty of space available for any enterprising individual who wants to start a new business.

Also, Alice Kryzan may have lost the Congressional race, but her push for developing green industries in Western New York shouldn't be forgotten. In fact, we should encourage Alice to carry on with the effort.  She doesn't need to be an elected official to be an effective leader in bringing together business owners and bankers to help create new jobs. In fact, it would probably be preferable to promote the effort without, or very little, government assistance.

When I look at things like the Harvester Center, or parts for wind turbines being hauled down Main Street, or local farmers experimenting with alternative energy sources, or an increase in shipping on the Erie Canal -- when I see and read these things, it gives me hope for the future of Western New York.

There's no reason not to expect WNY's best days are ahead.

Notes: Though I occasionally read Megan's blog, hat tip to Buffalo Pundit for pointing out the post; Also, Megan uses a photo of the Kodak Building from Flickr credited to SailorBill.  Ironically, SailorBill is my boss. The picture at the top of this post is one I took myself two years ago.

Last week, The Batavian reported that Pontillo's Pizzeria owed in excess of $112,000 in state taxes. That report came on the heels of an article in the Daily News in which Sam Pontillo claimed that he closed the restaurant in order to make renovations and officially purchase the property. A second article appeared in the Daily a couple days after our post that further confounded an already ambiguous story. Since then, more information has become available that may help us to ask some better questions in the hopes of getting some better answers.

On October 31, a civil suit was filed in Genesee County in which all three Pontillo brothers were named. That suit was brought by Buffalo attorneys Amigone, Sanchez, Mattrey & Marshall LLP on behalf of the plaintiff: John Pontillo. Listed as defendants in that case are: Sam, Paul and Salvatore Pontillo. No other details of the case were available at the Office of the Genesee County Clerk, and we have so far been unable to contact any of the brothers. We had left messages for Sam Pontillo last week that were never returned.

A week later, on November 7, a mechanic's lien was filed with the county by Roy H. Turnbull Inc. againt the estate of Elizabeth Pontillo and Pontillo's Batavia Pizzeria Inc. in the amount of $1,181.29. No specifics were listed in the record.

Those are the most recent facts. A search earlier today revealed no new filings with the county. Let us now take a moment to review the news as it was reported in the Daily. We feel that there are some contradictions and ambiguities that may help to shed some light on the situation.

From the first article, which appeared on November 4:

(Sam) Pontillo was advised that it would be better to just close the shop down and then re-open under new ownership. He regrets that he had to cancel a pre-election night party ... But he had no choice, Pontillo said. He was told that renovations were to happen now.

Firstly, who "advised" Sam Pontillo to close and "told" him that renovations had to "happen now"? In the same article, Beck writes that: "Sam has been on site running the Batavia and Le Roy operations the last several years." So if he's running the place, who is telling him to close it? Secondly, what are these renovations that they cannot be postponed even a single day so that the restaurant could cater a local party?

What's most confusing, however, is that in this first article, Sam Pontillo claims responsibility for both operations, in Le Roy and in Batavia. He would have to be running the place in order to make the decision to close it down, right? But in the article that appeared in the Daily on November 7—after The Batavian broke the news that the Batavia restaurant owed some $112,000 in unpaid taxes to the state—Sam Pontillo is quoted as saying: "I was locked out of the whole operation. John and Paul worked there (in Batavia). John was operations manager." Doesn't that contradict the claim in the previous article that Sam has been running the place for "years"?

Joanne Beck writes:

It was only after (Sam Pontillo) started the paperwork to buy the city property that Sam Pontillo became fully aware of the tax situation, he said. He doesn't dispute that tax warrants have been filed by the state Finance Department and Genesee County Clerk's office against the family business, which includes Pontillo's Batavia Pizzeria, Inc. and Sam's Tomato Pies, Inc.

But he doesn't claim them as his, either. The business is still owned by his mother and was not run by Sam, he said.

What!? Does Sam Pontillo run the business or not? What does it mean to be "fully aware"? Could he have been "partially" aware? What would that have signified? How can Sam not claim the tax warrants filed against Sam's Tomato Pies?

It is also reported in the most recent Daily News article that: "Genesee County records did not show any outstanding tax warrants on the Le Roy Pontillo's." That's true. As Sam Pontillo himself says of the Le Roy location: "I don't owe one cent for this place."

But Pontillo's Le Roy Pizzeria Inc. has been named in a civil suit filed by the Workers' Compensation Board of the State of New York that was filed on October 20. The Board also filed a money judgement in the amount of $1,250 against the Le Roy operation. As for any outstanding tax warrants, there are none. Pontillo's Le Roy Pizzeria Inc. was, however, served with a tax warrant by the New York State Department of Taxation and Finance in the amount of $700.63 in November, 2007. That was paid.

All in all, there are more questions than answers at this point, and I have yet to see a single car parked at the Batavia Pontillo's, which is supposed to be undergoing renovations right now. I guess we ought to take Sam Pontillo at his word when he says: "The remodeling won't be an obvious change that patrons will notice."

A pair of articles in the Buffalo News this morning has bleak and bleaker pronouncements to make on the upstate economy as we head into the holiday season. While economists have yet to declare the big 'R' word at the national level, researchers at one local university have no trouble making such a statement about our own home turf. From one article: "University at Buffalo researchers are declaring a recession in New York."

Not only have we taken off with a head start, but it looks like we'll be huffing and puffing out on the track field of troubled economies even after the nation has made its laps and gone:

“Given that the current decline has been precipitated by the implosion of the real estate bubble that created a serious financial crisis for major Wall Street investment banks and insurance companies, New York state’s economy is again likely to be hit harder than the national economy,” said Isaac Ehrlich, a UB economist. Wall Street accounts for about 20 percent of the state’s tax revenues.

In another article, picked up from the Associated Press, holiday job seekers are found to be too many for too few open slots.

The odds of landing a part-time job at department store operator Bealls Outlet Stores this holiday season are slimmer than getting into Harvard University: It’s one out of every 45.

It's much the same across the nation. In California, one 7-Eleven received more than 100 applicants in a week for a position that pays $8.50 per hour.

The national trends are being borne out locally as department store, convenience chain and call center managers who only a year ago had to scramble to fill holiday jobs are seeing a surge in the number of seasoned applicants — many of them laid off in other sectors and desperate for a way to pay the bills.

That was the case with Tracey Gibbs, a Buffalo resident who landed seasonal work at keepsake store Things Remembered in the Boulevard Mall. She said last month that she accepted a seasonal job because full-time positions were scarce.

What have you seen here locally? A few weeks back, the Daily News published a handful of stories on the economy that all sounded the note of cautious optimism. Since then, it seems things have only gotten worse. We've heard about troubles with several downtown businesses, and whether that's linked to the general economic downturn or not, it doesn't bode well. Are you a local retailer? Have you seen more applicants than usual looking for a part-time holiday gig? Have you cut back your positions?

Fire hydrants in the village of Oakfield will be flushed starting Monday and ending on Friday of next week, according to WBTA's Wayne Fuller.

Seventy workers at the Fisher-Price facility in East Aurora may soon be out of a job. The company, run by Mattel, plans to cut 1,000 jobs across the nation due to "the economic slowdown." About 900 people are employed at the facility in East Aurora.

Batavia-based manufacturer Graham Corp. has seen its sales slow in the second quarter after so many months of strong growth.

From the Buffalo News:

The troubles in the financial market and the plunge in energy prices are taking a toll on Graham Corp.’s sales and orders, but company executives said Tuesday they don’t think the slowdown will last long.

Investors, however, had a more bearish view, focusing on the company’s slowing sales growth and flat profits during the second quarter and causing Graham’s stock to plunge by 27 percent, or $5.70, to $15.25.

Graham Corp. is no more immune to the current credit crisis than anyone else, it would seem.

Because of the upheaval in the energy and credit markets, which have made it difficult for independent refinery operators to borrow the money needed for expansion or upgrade projects, Graham’s new order bookings fell by 15 percent in the summer quarter. Lines said he also expects orders to be “light” during the final three months of the year.

Still, (Graham's President R.) Lines said Graham’s customers continue to work on new projects and noted that the company still has ample opportunities to bid on future work.

Don't expect any economic slowdown to slow down the company's own verve. Lines is already talking aquisitions.

With nearly $43 million in cash on its books and virtually no debt, Lines said he sees the ongoing economic upheaval as creating an opportunity for Graham to use its solid financial position to make acquisitions, although asking prices remain high.

Graham is interested in deals that would be less than $100 million in size and broaden the company’s line of custom- engineered products for the energy industry, ranging from refinery projects to the renewable energy field. The company also is interested in deals that would expand the company’s geographic footprint, he said.

Monday morning, Pontillo's restaurant in Batavia closed up shop temporarily for renovations. "It's all good," owner Sam Pontillo told Daily News reporter Joanne Beck. In that article, which appeared in the Tuesday edition of the Daily, Beck wrote that Pontillo "expects to re-open ... within a couple of weeks."

One has to wonder if that's really the case. Owing to an anonymous tip, The Batavian has learned that "Pontillo's Pizzeria" in Batavia owes more than $112,000 in unpaid taxes to the New York State Department of Taxation and Finance. In an attempt to collect those funds, the state department has issued six tax warrants to "Pontillo's Batavia Pizzeria Inc." totalling $58,379. Another roughly $53,000 in unpaid taxes were the subject of warrants issued to other "trade" names of Pontillo's.

Finance Department Spokesperson Susan Burns:

"Generally, the tax department tries to work with the taxpayer and work on some sort of negotiated settlement in order to satisfy those warrants. Generally we like to see everything come to a positive outcome, and that's generally what happens in these situations. Sometimes, is there a time when a business is seized? Yes, that happens also."

No seizure of property has yet been made by the state, however, Burns said. Pontillo's is not faced with any deadline when the taxes must be paid. Burns stressed that the department does its best to negotiate a settlement before it comes to legal seizures.

In a records search at the Office of the Genesee County Clerk, The Batavian turned up six tax warrants issued to Pontillo's Batavia Pizzeria Inc. Two of those were for withholding tax, three for sales tax and one for corporate tax, explained Burns. They were issued between March 28 and October 17, of this year. All are still outstanding.

In addition to these, we discovered another tax warrant issued to "Sam's Tomato Pies Inc." and "Pontillo's Pizza" in the amount of $36,117.80. Another warrant in the amount of $17,585.03 was issued to "Pontillo's Pizzeria." Burns explained that "Pontillo's Batavia Pizzeria Inc." has been trading under the name "Sam's Tomato Pies Inc." for about a year or so now. Pontillo's Pizzeria is the sort of general rubric that comprises the Batavia Pizzeria Inc. and Sam's Tomato Pies. That entity is responsible for all of the owed taxes listed under all three "trade" names, which amounts to more than $112,000.

A warrant was also issued to Pontillo's Batavia Pizzeria Inc. by the New York State Department of Labor in the amount of $1,640.92. The Workers' Compensation Board of the State of New York has also filed a judgment in the amount of $1,250, in addition to a civil suit filed with the state's Supreme Court.

Whether this is related to the recent closure of Pontillo's, we cannot say. The Batavian tried to contact Sam Pontillo earlier today. We left a message at the Pontillo's restaurant in Le Roy at 3:30pm. We also tried a telephone number listed for John Pontillo in the Batavia phone book, but that was disconnected.

Pontillo's closed Monday morning and will remain that way for a couple of weeks or more, according to the Daily News. The restaurant will undergo renovations in that time.

In other news, the city school district—along with others all over the state—have been warned "to brace themselves about future state aid," according to Pat Burk, Batavia's Board of Education president. More info should become available in a couple weeks.

We encourage you to pick up a copy of the Daily News at your local newsstand. Or, better yet, subscribe at BataviaNews.com.

It's all about the economy today in the Daily News. Hardworking reporter Joanne Beck logged no less than three front page stories today, all with a local look at how the current economic crisis is hitting home for folks in Batavia.

In one article, Beck chats with some downtown business owners about how they're faring "despite the recent stock market collapse." Chris Ariyaratnam, owner of the Main Street beauty salon Mane Attraction, told Beck that shoppers aren't "going to cut back."

"They're starting their Christmas shopping now," [said Ariyaratnam]. "I think they'll spend the same, but I think it will take longer. I think it's going to be OK."

Beck found much of the same mood among other downtown retailers and restaurateurs. Maybe they're not stocking as much, but their expectations of a good season are high.

In another article, "consumers" are given their turn to be optimistic despite the ongoing financial crises. Sherrity DiSanto told Beck:

"Short-term, I'm worried. But long-term, I think it will be picking itself back up. With gas prices going down and some sales, people's desire to shop will come back."

The optimism keeps on rolling in Beck's third article on the economy, in which she gets the advice of Dave Chua, a financial adviser with the Legend Group, "a retirement planning and investment company." Chua urges people to "remain still with where you are" and know that "it won't last forever." In particular, people looking for some extra cash shouldn't just dip into their retirement account. They should "explore other options."

Meanwhile, a wire story picked up from the Associated Press reads: "Debt clock out of digits." Apparently, it couldn't fit the "1" to indicate the nearly $10.2 trillion in national debt. Good news, though. We'll get a new clock in 2009 that "will be able to track debt up to a quadrillion dollars, which is a "1" followed by 15 zeros."

We encourage you to pick up a copy of the Daily News at your local newsstand. Or, better yet, subscribe at BataviaNews.com.

Recognitions keep on coming for Batavia's Graham Corp. The vacuum and heat transfer manufacturer has climbed 100 spots on the Forbes list of the 200 Best Small Companies and cracked the top ten, landing at No. 10 and boasting a 41 percent return on equity for the past 12 months. Forbes had this to say of the company:

Graham Corp., in Batavia, N.Y., makes pumps, condensers, vacuum and heat transfer equipment for heavy industry, especially oil refineries. Revenue increased 31% last year and the backlog 40%. The domestic, Canadian and Middle East markets are booming. The 72-year-old company has branched into Suzhou, China.

Graham got a nod from Business Week earlier this year, making the list of the fastest growing small companies.

We've got a call into Graham to get some comment from the company on the recognition. We'll be sure to pass that along as it comes to us.

Batavia-based Graham Corp. hasn't been immune to the recent tumble in stock prices.

The company, which traded at a 52-week high of $109.82 in mid-August, closed Friday at $40.18, only 18 cents above it's 52-week low of $40, achieved in early January.

The stock lost 32 percent of its value in the past week, falling $18.68 per share.

On August 31, the Democrat and Chronicle ran a story noting that Graham was the region's best performing stock for the previous 12 months.

You can read company press releases and see it remains a strong financial performer.

In July, GHM announced a dividend increase and a 2-for-1 stock split to take effect tomorrow.

Most of the stories on the front page of today's Daily News were already featured on The Batavian this morning. We featured a full post on the court settlement between former priest Simon Howson and the Episcopal Diocese of Western New York. We also included in our early morning roundup two stories picked up from WBTA about the awarding of a $3 million grant to United Memorial Medical Center and the demolition of a downtown block in Le Roy.

We did not yet report that a state committee has begun the search for a private operator to take over the ownership of the state School for the Blind in Batavia. Scott DeSmit reports that "two private entities ... may be qualified to operate the school: Perkins School for the Blind in Masachusetts and The Center for Discovery in Monticello." Other operators may also be interested, and state legislature approval will be required before any move toward privatatization can go forward.

In other news, two new businesses are on their way to the town of Batavia: one to the new shopping center and another on West Main Street Road. Peebles, the national clothing retailer, will host its grand opening on November 13 at its location in the Batavia Shopping Center on Veterans Memorial Drive. Other businesses expected to move into the plaza include: "Cato, a women's and girls' cothing store; GameStop, a video game retailer, and a Shoe Show shoe store." Also planning on an opening by the end of the year is a KFC/Long John Silver's, which is set to open its doors at its West Main Street Road location by Christmas.

As for non-retail construction, an apartment complex set to go in "next door to East Town Plaza" got its approval from the state Division of Housing and Community Renewal. Joanne Beck writes:

The state-funded project is to be 43,000 square feet of a parking lot, two entrances (one for emergency vehicles) and 40 one-bedroom apartments. The units will predominantly be for clients of DePaul, a Rochester-based not-for-profit group that specializes in assisted living programs to help people who have mental illness, are in recovery from chemical addiction and/or live with a developmental disability.

Art enthusiasts and crafters in Genesee and Orleans counties will be happy to learn that galleries and studios throughout both counties will be open to the public this weekend. Genesee gets its turn Saturday from 10:00am to 4:00pm. Orleans will have a go at the same times Sunday. Pick up your free map and brochure listing of all participating studios at GO ART! at 201 E. Main St., Batavia.

We encourage you to pick up a copy of the Daily News at your local newsstand. Or, better yet, subscribe at BataviaNews.com.

Larry's Steakhouse is set to open this Thursday for lunch and dinner. Larry's is located at 60 Main Street, attached to the Genesee Country Mall, with front-door access on Main Street.

We stopped by the restaurant today to wish them well and find out more about what they've got to offer. You can download the complete menu here. We also asked owner Steve Mullen if he could describe the place in a single sentence. He told us: "It's a great new dining experience with a very affordable menu." They've got everything from Guinness artichoke dip to marinated Mahi Mahi.

It's not hard to guess that steak is the specialty. Steve recommends the everyday steak special: a 14 ounce NY Strip, with a cup of chili or soup de jour, a salad and a side for $17.99.

The smartest thing I heard from Jon Powers during his campaign was about turning Western New York into a decent place to start new, green businesses.

I thought of that when reading Thomas Friedman's column today.

But that is not the point of this column. The point is, we don’t just need a bailout. We need a buildup. We need to get back to making stuff, based on real engineering not just financial engineering. We need to get back to a world where people are able to realize the American Dream — a house with a yard — because they have built something with their hands, not because they got a “liar loan” from an underregulated bank with no money down and nothing to pay for two years. The American Dream is an aspiration, not an entitlement.

In a green economy, we would rely less on credit from foreigners “and more on creativity from Americans,” argued Van Jones, president of Green for All, and author of the forthcoming “The Green Collar Economy.” “It’s time to stop borrowing and start building. America’s No. 1 resource is not oil or mortgages. Our No. 1 resource is our people. Let’s put people back to work — retrofitting and repowering America. ... You can’t base a national economy on credit cards. But you can base it on solar panels, wind turbines, smart biofuels and a massive program to weatherize every building and home in America.”

So even if Jon Powers ain't the 26th District, why can't WNY be a leader in creating new green businesses? Does it take a congress rep to make that happen, or just visionary entrepreneurs?

A state grant for $50,000 recently awarded to Batavia-based Graham Corp. will be used to certify the company with the International Organization for Standaridization, better known by its acronym: ISO. In particular, the funds will pay for the consultant who needs to be hired to guide the company through the standardization process and the subsequent training and development in the ISO procedures.

Dan Harvey, Graham's human resources director, said that the company is pursuing its "ISO-9000 quality system" certification. Such certification from the ISO essentially provides a stamp of approval for manufacturers that says the company and its products meet specifications accepted around the world.

"We're still in the process of meeting specifications," said Harvey. "We have not yet reached those. We're still doing some more training and development, and there are different milestones we're looking to acheive."

This kind of grant is called "an insutrial effectiveness grant," according to Stefanie Zakowicz, spokesperson for Empire State Development, the state economic development group that authorized the grant for Graham.

Said Zakowicz:

"The purpose of the grant is to pay consultant fees that provide technical and financial services to help a firm improve its productivity, efficiency and market share. It's only for New York State manufacturers that employ fewer than 500 workers, so small to mid-size. The more employees you have, the more you can get. In their case, at the time of application, they had 280 employees. Anything over 100, would make you eligible for up to $50,000."

Graham Corp. applied for the grant on June 17, of this year. They are on schedule to complete the project by the end of September.

Some 150 residents and officials of the town of Alabama got together last night to talk about a proposal that would allow a 1,300-acre manufacturing site to move into town at the intersection of Route 77 and Judge Road, according to WBTA's Chad Zambito. It seems no specific manufacturer has yet been named, though a feasibility study shows that a solar panel or flat display manufacturer might be the best fit. Nothing will get done, however, without state funding and the sanction of the town. Word is that any such large-scale manufacturer could bring "thousands" of jobs to the area.

That brings up a serious question: What would thousands of jobs, which I interpret to mean thousands of new people, mean for a town that hasn't even cracked the 2,000 mark in population? Doesn't that mean a new town? Also, how does that work? Recruiting for thousands of jobs? Are there stipulations that jobs must first come from the region? How is that possible? What other benefit would such a manufacturer have for a rural community? Would this mean the transition to more suburban living in Alabama?

Lots of questions here. Don't know if the Alabamans are already asking or not. Anyone know?

In other news, we reported yesterday on an article from the Daily News about the shady goings-on at a pair of area Pizza Hut restaurants. Today, the official word is out: Pizza Hut restaurants in Albion, Amherst, Medina, Alden, East Aurora, Grand Island and Aurora have all been closed. Zambito reports that the owners cite poor performance as the reason for closing the shops—why else would they, right—and say that they will open new locations "under the Wing Street Chicken Theme," whatever the heck that means.