Erie Times-News Erie 2016 by ErieTimesNews

Annual economic report for the Erie region | Sunday, February 14, 2016

EriE 2016

INSIDE: A new Erie emerges on transformed bayfront. 2K | Family-run manufacturer celebrates 100 years. 1L | 4 under 40 making a difference. 1M | How CEO helped invest in Erie. 1N

2K | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ERIE 2016

ERIE TIMES-NEWS PHOTOS

LEFT: The GAF Materials Corp. plant, a bayfront anchor for more than 100 years, occupied the space west of the Erie County Convention Center in 2007. MIDDLE: The former GAF plant was demolished and the site cleared in preparation for environmental cleanup in 2012. RIGHT: A new parking garage and hotel are being built, part of a complex planned for the site.

Something to

BUILD ON

Changing times make resilience, entrepreneurial spirit essential to Erie’s future

WHAT DOES ERIE NEED? “What Erie needs is ...” — how many times have you heard a sentence begin with those words? Sometimes the end of the sentence is wishful or trivial. Lots of people say Erie needs a Cheesecake Factory, for instance. Others suggest better weather, big-name concerts or a large international airport with cheap flights to hundreds of destinations. We asked a range of people to provide a serious answer to that question: What does Erie need to succeed, to be a stronger, vibrant and successful community? Here’s what they told us:

By JIM MARTIN jim.martin@timesnews.com Jan. 17, 2007, was a dark day for workers at GAF Materials Corp., who learned that the plant was closing after 120 years. There is no glossing over the challenges they faced or the pain they felt. Some went on to good jobs at GE Transportation or found work elsewhere. Others have never fully recovered what they lost. But in a broader sense, Erie did what it has always done. It took the punch. It moved on. Doubts about that spirit of resilience can be weighed against evidence that will be presented Monday at a public meeting to be held at 7 p.m., next-door to the GAF site at Erie’s Bayfront Convention Center. Representatives from Kidder Wachter Architecture & Design will present their concept for a $300 million development plan for the 12.5-acre site that was once home to GAF. Plans for the property, now known as Bayfront Place, include space for restaurants and offices, residential units, parking, bike trails and green space. A portion of the GAF property is already being used for a new parking garage that’s being built adjacent to the $54 million Courtyard by Marriott hotel that’s taking shape on the waterfront. Not everyone will like this plan. Somewillsayitsambitionsaretoosmall or too great, its intentions misplaced. But the plan suggests something about Erie. It says Erie won’t be content to stare at the crumbled remains of what used to be.

FORGED BY CHALLENGES The ongoing transformation of Erie’s bayfront, captured on the cover of this section, might be viewed as a symbol of Erie’s resilience. Other signs of resilience are less eyecatching. Ask Joe Dudenhoeffer, the 38-year-old chief executive and primary owner of Klein Plating Works, a small company that’s been in his family for 100 years. The company survived a devastating fire that shut the plant down for several months in 2003, weathered crippling losses inflicted by the dot-com bust and lost substantial revenue when one of its biggest customers declared bankruptcy. Today, the company has carved out a profitable niche and employs about 50 people.

“The people of Erie need to get to know each other. Getting to know the people who are your neighbors helps create a sense of belonging and shared identity in a local area. It also helps to strengthen connections and trust in the people with whom you share life in a given community.”

— Sister Marlene Bertke, coordinator for Erie Benedictines for Peace

“Continue improving the marketing of Erie outside our region (VisitErie). “Strive to be a more ‘livable’ city to attract residential housing by improving safety and accessibility to retail, restaurants, entertainment and service businesses downtown. “Government leaders at both the local and state level that have vision for growth, and consider growing businesses assets and not sources for tax revenue.” — ANDY COLWELL/Erie Times-News

Construction continues on the Courtyard by Marriott hotel and retail complex on Erie’s bayfront. The hotel is part of the planned Bayfront Place development. The plans will be discussed at a public meeting Monday at 7 p.m. at the Bayfront Convention Center. But getting to that point wasn’t easy. “I had ulcers back then,” Dudenhoeffer said in a recent interview. “There was a day when I think we had $38 in our checking account. I’ll look back at that and just remember where we were and where we came from.” All of Erie County can do the same. After weathering a deep recession that began in December 2007 and a slow recovery that left the local economy limping along for years, Erie County’s seasonally adjusted unemployment rate has fallen to 4.9 percent. And the number of unemployed Erie County residents fell from a high of 15,000 in January 2010 to 6,100 in December.

ABOUT THIS REPORT

ON THE COVER: An aerial view of Erie’s bayfront shows the Courtyard by Marriott hotel under construction on Jan. 7. Photo taken by Rob Frank, special to the Erie Times-News.

COUNTING THE WINS Maybe we don’t reflect often enough on the success of companies like Klein Plating Works. Many outsiders have observed that Erieites are good at remembering the past and reflecting on what they’ve lost along the way, but not so good at taking stock of what went right. Rick Novotny, executive director of the Erie County Redevelopment Authority, said people still talk about the loss of Erie Plastics in Corry in 2008. Far fewer people, he said, are aware

➤ Please see BUILDING OUR FUTURE, 8K

Erie 2016 is the Erie Times-News’ 17th annual report on Erie’s economy. The coordinator and lead writer was Jim Martin. Reporters Erica Erwin, Kevin Flowers, Ron Leonardi, Dana Massing, Valerie Myers, Ed Palattella, Lisa Thompson and Gerry Weiss and contributing writer Kara Murphy assisted. Graphic artist Chris Sigmund and the photo staff —

Steve Gorman, president of Waldameer Park & Water World

“Erie needs to start planning collectively for resiliency and climate adaptation. Our weather is going to continue to be more erratic and unpredictable.” — Amy

Jo Zola, executive director of EnvironmentErie

“Diversity. A diverse workforce and jobs.” — Andre Horton,

chairman of Erie County Council

“Stay positive. As a community, accept your role and make sure you stay positive, and work to make Erie the best place you can make it in your area.” — Erie Police

Chief Randy Bowers

➤ Comments continue, 8K

supervisor Christopher Millette and photographers Andy Colwell, Sarah Crosby, Jack Hanrahan and Greg Wohlford — contributed to the visuals. The project was overseen by Doug Oathout, executive editor. Sherry Rieder, managing editor/production, supervised production. The section was designed by Kristin Bowers.

ERIE 2016

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 3K

Region’s economic indicators A brief look at the state of Erie County and Crawford County.

Per capita personal income

Electric rates

The more we make, the more we spend.

Lower rates mean residents have more cash.

Erie metropolitan area

Penelec rates

$38,200 in 2014

$109.75 in January

Unemployment

Up $21.92 from January 2015. Based on 750 kilowatts per month.

The verdict:

Higher bills mean less money in our pockets.

Natural gas rates

Employment is one of the most important indicators of economic wellbeing.

The verdict:

Erie

Down from 5.1% in in December Dec. 2014

4.9%

Meadville

Down from 4.8% in 4.7% in December Dec. 2014

Manufacturing employment

Erie County

Manufacturing remains a key employment sector.

in December

The verdict:

Erie, Crawford counties’ rates are improving.

22,300

Unchanged from Dec. 2014

Crawford Co. Down 100

7,500

in December

from Dec. 2014

Up from $37,276 in 2013

The verdict:

Manufacturing jobs are not growing in Erie region.

Service employment Service industries include fast food, banking, insurance and other jobs.

As rates rise, residents spend less elsewhere.

Erie County

National Fuel rates

105,800

$53.57 in January

Crawford Co.

24,600

Based on 94,900 cubic feet used per year.

Up 400 jobs from Dec. 2014

in December With many jobs added, this sector is a bright spot in the local economy.

The verdict:

Customers are paying less than they did a year ago.

Gasoline prices

Flights

The average cost of a gallon of regular unleaded.

People boarding planes at Erie International Airport is a reflection of business and leisure travel.

Erie metropolitan area

$1.85

early February Down 23 cents a gallon from early February 2015

The verdict:

Up 700 jobs from Dec. 2014

in December

Down $4.91 from January 2015.

The verdict:

A modest gain is still good news.

Pump savings means consumers can spend money elsewhere.

Employment at plant

GE Transportation

GE Transportation’s Lawrence Park plant is Erie County’s largest employer.

in 2015

The verdict:

4,100 Down about 500 from 2014.

Park visitors

Presque Isle State Park attendance

Visitors help drive local tourism.

4.06 million

The number of local jobs has dropped over the past year.

in 2015

89,587 Down 7,635 from 2014

Up 310,000 from 2014

The verdict:

Erie International Airport

Erie’s relatively dry summer and typical temperatures attracted visitors.

The verdict:

Fewer passengers hurts local economy.

SOURCE: Pennsylvania Department of Labor and Industry; Erie International Airport; VisitErie; AAA; U.S. Census Bureau; GE Transportation; National Fuel Gas Distribution Corp.; Penelec; Presque Isle State Park ERIE TIMES-NEWS file photos; JIM MARTIN and CHRIS SIGMUND/Erie Times-News

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ERIE 2016

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Scott going strong

DEVELOPER:

Erie company ready for new adventures in entertainment By GERRY WEISS gerry.weiss@timesnews.com

FILE PHOTO JACK HANRAHAN/Erie Times-News

Nick Scott Sr. is president and founder of Scott Enterprises, which owns hotels, restaurants, Peek’n Peak Resort and Splash Lagoon Indoor Water Park Resort. The company has plans to add restaurants and an adventure park in the region. hand sofa the primary piece of furniture in their living room, before Kim Scott would leave for a substitute teaching job. Today, Nick Scott Sr. is president of Erie-based Scott Enterprises, which owns about 30 commercial properties, including hotels, restaurants, a ski resort and an indoor water park ranked No. 7 in the nation by USA Today. The company, which opened its second hotel in the Buffalo area this past fall, employs more than 2,000 people, attracts 4 million visitors annually at its businesses, and serves more than 2 million meals a year at its restaurants. Scott’s two favorite hob-

bies, photography and travel, fuel his drive to study and learn about the hospitality industry around the world, and to see what unique methods and experiences he can bring back to his hometown. “I have this curiosity that never stops,” he said. “I’m always out there thirsty, looking for new ideas.” Scott is a stickler for details, taking photographs of the hotel rooms he stays in and the meals he eats — yes, photos of food on a plate and the various presentations he sees — while collecting hundreds of restaurant menus. “My kids joke with me that I’m someday going to open up a menu museum,”

he said before laughing. John Oliver, president of VisitErie, the primary tourism agency for Erie County, has known Scott since he arrived here 14 years ago when Oliver changed jobs and left his post as the director of marketing and sales for the Niagara Falls Convention Center. Oliver said Scott has had as big an impact on the local tourism economy as “anybody in Erie’s history,” citing Splash Lagoon Indoor Water Park Resort, one of Scott Enterprises’ crown jewels, as attracting a sizable portion of its 350,000 annual visitors “during a time period when, in the past, no one would come to Erie during the winter.”

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On a 17-hour flight from Newark, N.J., to Hong Kong, at the start of a recent 40day trip to Southeast Asia, Nick Scott Sr. perused nearly 45,000 photographs on his laptop computer. The photos, all shot by Scott himself, were from vacations he and his wife took to India, Antarctica and the Baltic states over the past year and a half. Scott, a passionate photography buff for more than 50 years, sifted through the photos, searching for gems that perfectly captured the culture and climate of those exotic locations. Boats on the sacred Ganges River. A leopard seal sitting on an iceberg in Antarctica before slipping into the water. Children walking near a balloon seller in a busy square in India. Life wasn’t always like this for Scott, 74, who is perhaps the region’s most prominent developer with one of the best-known names in Erie. In his early 20s, Scott was a front-desk clerk working the overnight shift at a motel in downtown Erie. His wife, Kim Scott, would wake up their two infant daughters at 5 a.m., load the babies into the couple’s only car, and drive to pick up her husband after work. They’d return to their small house, with a second-

HOW GECAC IMPACTS ERIE COUNTY

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Part of what I think has led to his success is that I don’t know if I’ve ever met anyone who asks as many questions about everything, whatever the topic. He’s always trying to learn more, to grasp new trends and take it all in. He’s extremely unique.” — JOHN OLIVER, VISITERIE PRESIDENT, ON NICK SCOTT SR.

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ERIE 2016

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AMUSEMENT: Waldameer plans additions to last summer’s $9 million expansion

Park makes a splash

Steve Gorman worried the rain would leave his business all wet. Gorman, the president of Waldameer Park & Water World, watched as the precipitation drenched the region in June and early July, dampening Waldameer’s debut of one of its most expensive attractions — a 467,200-gallon wave pool. But by mid-July, the weather had become sunnier and the bathers plentiful. Gorman was relieved. “By the beginning of July, we were pretty scared,” he said. “We were really hurting. The weather was really bad. We were thinking, ‘What are we doing with this wave pool?’ “But then the weather turned around,” Gorman said, “and it proved to be a wonderful addition.” Gorman this summer is ready for another addition — the second phase of the expansion of Waldameer’s water park. Waldameer’s staff, including Gorman and his father-in-law, Paul Nelson, Waldameer’s owner, are introducing the Kidz Zone, an area next to the wave pool designed for children shorter than 4 feet. Kidz Zone will feature: ▀ Eight colorful slides that will empty into a 50,000-gallon splash pool. ▀ The 4,000-square-foot Splash Pad spray deck, with 30 interactive water spray jets for younger children. ▀ Twelve cabanas that visitors can rent. Each

CONTRIBUTED IMAGES

AT TOP: A water slide park, similar to the one pictured, is set to be built this year at Waldameer Park & Water World. AT BOTTOM: A children’s splash area, pictured in an artist’s rendering, is part of $1 million in improvements this year. will feature a refrigerator, lounge, chairs and a table. “There will be more for the younger kids to do,” Gorman said of Kidz Zone. “It is a secure area. Young families will be happy.” In the main park, Waldameer is opening the Carousel Sub Shop. It will

be next to the merry-goround, in the area that had been the Imagination Station craft attraction. Gorman said this season’s improvements will cost $1 million. The 2015 expansion, he said, cost $9 million, including $3.3 million for the wave pool.

Waldameer built a new parking lot as part of the 2015 work. All of the additions are the latest example of Waldameer following its mantra: that the park, which turns120yearsoldthisyear and has more than 75 rides andattractions,offer some-

thing new each season. For any amusement park, “adding something new is almost a must, to keep people coming back,” said Jeffrey D. Mona, president and co-owner of the Erie-based American Resort Management LLC, a development, consulting

and management business whose clients include amusement parks and water parks. “It’s always great if you can add a new feature and grow your park,” said Mona, whose clients do not include Waldameer. “It gives you the potential for more capacity and gives you the potential to market to a wider variety of age groups.” Mona, who is also on the board of the World Waterpark Association, praised Nelson and Gorman and their families for reinvesting in Waldameer with the wave pool and other rides. Those rides include the $7.5 million Ravine Flyer II roller coaster, which opened in 2008 and spans Peninsula Drive near the entrance to Presque Isle State Park in Millcreek Township. “They do a great job,” Mona said. “They are fairly forward-thinking. They realize they need to grow and expand, and the nice thing is they are committed to putting money into it, and they are seeing the return.” With the wave pool helping to anchor the park, Waldameer enjoyed a solid 2015 season, Gorman said. The season also inaugurated Waldameer’s seven-daya-week schedule. The park had been closed Mondays. “Our revenue was up about 20 percent, largely due to our increased operating calendar,” Gorman said. In addition, he said, “Labor Day was later than usual, so we had about 20

➤ Please see WALDAMEER, 9K

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By ED PALATTELLA ed.palattella@timesnews.com

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ERIE 2016

Building our future Continued from 2K that the massive 400,000-square-foot building on Route 6 is fully rented to tenants that together employ nearly 200 people. WemournthelossoftheBostonStore andignore therealitythatErieisa powerhouse of a retail center and that the Millcreek Mall complex ranks as one of the nation’s largest in terms of total square footage. And in our focus on the past, perhaps we ignore the money being invested for the future on Erie’s west side at Lakewood Plaza and Pittsburgh Commons. While we lament the passing of Steris Corp., the failure of Rent-Way and the juice plant that was never built, we forget the massive Welch’s juice plant in North East and the hundreds of jobs it provides. Time and the forces of the economy have claimed some of Erie’s most cherished institutions. But what about Erie’s other institutions — a thriving Waldameer Park & Water World, a jam-packed Splash Lagoon Indoor Water Park Resort? Who would have guessed that Lake Erie College of Osteopathic Medicine would grow into the nation’s largest medical school as measured by enrollment, an institution with an economic impactestimatedat$185millionayear? The footprint of parent company LECOM Health continued to grow in 2015 as the health system announced the addition of three senior living communities, the completion of the $42 million LECOM Senior Living Center and the acquisition of Corry Memorial Hospital.

THE PARADOX OF CHEAP ENERGY Both resilience and some smart planning will be in order this year as Erie business owners battle a challenge that few saw coming: low energy prices. While consumers are saving money at the pump and to heat their homes, cheap coal, oil and natural gas have contributed to the loss of hundreds of local jobs, including at Lord Corp., Eriez Manufacturing, FMC Measurement Solutions, GE Transportation and Joy Global in Franklin. “Most of us were surprised by the

They say necessity is the mother of invention. When you have necessity, you better get inventing.” — TIM SHUTTLEWORTH, CHIEF EXECUTIVE OF ERIEZ MANUFACTURING speed of the decline and how it hasn’t seemed to be like the past where you would have a bounceback,” said Tim Shuttleworth, chief executive of Eriez Manufacturing, which has about 320 employees in Erie County. “The coal industry has been pummeled,” he said. “Some of our customers were the biggest players in the coal industry, and they keep filing for bankruptcy.” The decline in those markets prompted Eriez to offer early retirement options. Mostly, though, the company’s strategy has been to look to other markets and other products. “They say necessity is the mother of invention,” Shuttleworth said. “When you have necessity, you better get inventing.”

AN ENERGY BUBBLE? Ken Louie, a professor of economics and director of the Economic Research InstituteofErieatPennStateBehrend’s Black School of Business, said most of us underestimated the effect lower energy prices would have on the economy in places like Erie that build machines and parts for the energy sector. Some have suggested there is an energy bubble that could burst, in much the same fashion that dot-com companies crashed and burned in the early part of the 2000s. Louie doesn’t think so. He does see the potential for further fallout, some of which could be felt here. But the picture isn’t yet clear. “In the long run, it’s like the dust is settling,” Louie said. “For now, the dust is still in the air.”

WORKING TOGETHER The same might be said for efforts to solve many of the challenges fac-

ing Erie, from violence and poverty to blight and a shortage of new businesses. Erie County Executive Kathy Dahlkemper sees a community still struggling to work together and to resist a tendency to be negative. “No matter what you do, there are always going to be people who resist all the good things in our community, from the baseball stadium to the library,” Dahlkemper said. Erie has its challenges, she said. Gone, for the most part, are the days of walking out of high school graduation and into a family-sustaining job. The good news, she said, is the number of people working to create an environment where jobs can flourish. “I am seeing more collaboration in this community,” she said, referring to the growing number of organizations working to help entrepreneurs. “I am seeing energy around new and different ideas.” There is other good news. Jim Kurre, a retired economics professor and director emeritus of the Economic Research Institute of Erie, has long championed the importance of what he calls “the meds and the eds,” an unlikely employment sector that includes health care and education. In a community often described as a rust-belt manufacturing town, UPMC Hamot and Saint Vincent Hospital are two of Erie County’s six largest employers. Kurre is especially bullish on the role education has and is likely to have in Erie’s future. “Locally, the growth in higher education has been dramatic in the last 40 years. We are bringing in students from all over the world, and some of them are staying,” he said. “That helps the local economy, and it helps Erie have a broader world view.”

A TOURIST TOWN, TOO On that January day when workers at GAF learned their plant was closing, one worker beckoned to the hotel and convention center taking shape next door and said he wasn’t surprised. “They’re turning Erie into a flipping

➤ Please see FUTURE, 10K

MAKING CONNECTIONS. BUILDING FUTURES.

WHAT DO WE NEED? “I think what we need is continued and increased collaboration, and we need to appreciate all the positive things about Erie.”

— Erie County Executive Kathy Dahlkemper

“The first thing to do is admit we’re clearly failing as a region and blow up everything we are doing. We changed Harborcreek eight or nine years ago, fixing our blight and offering significant financial incentives to redevelop and attract jobs, and we’re thriving.” — Dean Pepicello, chairman of the

Harborcreek Township Board of Supervisors

“The Erie region needs to continue focusing on providing clearly identifiable pathways for children, youths and adults to move up the socioeconomic ladder. Doing so breaks the cycles of poverty and hopelessness, provides a higher quality pool of employees to businesses, and even fosters entrepreneurism.” — Steven Bishop,

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“Positivity and allowing people who want to do things the space and the ability to do those things.” — Jonathan D’Silva, intellectual

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ERIE 2016

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FILE PHOTO/Erie Times-News

Nick Scott Sr. traverses an obstacle while training for the Aerial Adventure Course at Peek’n Peak Resort near Findley Lake, N.Y. Scott’s company bought the ski resort out of bankruptcy in 2011 and added the aerial course in 2014.

Scott: Company set for new adventures Continued from 4K obstacle course and glowin-the-dark miniature golf, and feature more than 20 trampolines, including trampolines where participants play dodge ball and shoot baskets as they jump. Scott said construction work on the project, which he calls “unlike anything else in the country,” should begin sometime this spring. “Nick’s innovative vision has always provided Erie with quality hotels, restaurants and entertainment, and his desire and drive generates others to invest and innovate in the region,” said Barbara Chaffee, chief executive of theErieRegionalChamber and Growth Partnership. Chaffee has known Scott since the 1970s, when she worked through the ranks at Holiday Inn and eventually became president of her family’s Erie-based Oakdale Corp., a hotel and restaurant management company that competed with the Scott family business. “He’s a tough businessperson, in that he’s cautious about his investments and works very hard to get the best deal he can,” Chaffee said about Scott. “That’s a big responsibility of running a good business.” Scott was 9 when he worked his first job —

I’ve always had a lot of pride in Erie and doing things here. I enjoy creating something out of nothing.” — NICK SCOTT SR. washing dishes at Scott’s Restaurant, owned by his father, the late Chris Scott. During his teenage years, he worked as a gardener and lifeguard at Scott’s Motel, earning roughly 50 cents an hour. The Erie native was an only child raised in the public school system, first at Harding School and then Strong Vincent High School, before enrolling at Cornell University, where he studied business, took courses in the top hotel administration program in America, and met his future wife. The first business he developed, armed with his father’s financial backing, was a Bonanza Sirloin Pit restaurant on Peach Street in 1967. For $1.39, a customer could get a 12-ounce bonein sirloin steak, baked potato, salad and a thick slice of Texas toast. “They were lining out the door and around the building,” said Scott, who managed the restaurant

and worked in the kitchen as the head cook. Nearly 50 years later, Scott remains a thriving, prominent developer, while observing that “most of my friends are retired now.” Scott Enterprises paid more than $11 million in August 2011 to buy Peek’n Peak Resort, near Findley Lake, N.Y., out of bankruptcy. Harbor Place, a proposed $150 million hotel, retail and residential complex that his company hopes to build, is still in a development phase. The project would be located west of Blasco Library and built on 12 acres on the east bayfront, land Scott and his business have owned for 17 years. Scott also is bringing three IHOP restaurants to the Erie area and expects to open the first one in April. “I’ve always had a lot of pride in Erie and doing things here,” said Scott, who has five children and 18 grandchildren. “I enjoy creating something out of nothing. You look at a piece of land and say, ‘I see something that I think will work in this market.’ And then you make it happen.”

G E R R Y W E I S S can be reached at 870-1884 or by e-mail. Follow him on Twitter at twitter.com/ ETNweiss.

Waldameer: Additions in works for water park Continued from 5K percent more operating days. Our operating expenses increased as well, mainly due to increased utilities — water and electric — and more staffing for the waterpark expansion.” Season passes, which Waldameer introduced in 2010, increased in popularity, giving Waldameer an influx of cash at the start of each season. Gorman said sales of season passes rose 15 percent, and that about 20 percent of those carrying passes were from outside Erie County. The wave pool drove much of the increased traffic at Waldameer, Gorman said. But he said the park was able to accommodate more people mainly because of the wave pool, which can hold as many as 1,000 bathers. The large number of people in the wave pool alleviated crowding in other areas of

The wave pool did what I was hoping for. It spread people out in our other water parks.” — STEVE GORMAN, WALDAMEER PRESIDENT the park, particularly on hot days, Gorman said. “Some people call a wave pool a people eater,” he said. “The wave pool did what I was hoping for. It spread people out in our other water parks, because we were overcrowded on busy days. Traffic flow was better. It was a new attraction that drew people in as well.” Gorman and Nelson are already planning for the 2017 season, when the third phase of the water park expansion is scheduled to open. Among the features will be a large climbing structure, more slides and a large tipping bucket. In the years ahead, Wal-

dameer plans to add more adult water slides, “and we are also looking into doing something to the amusement park,” Gorman said. “We have a long-range plan.” A dedication to such thinking — rain or shine — has become Waldameer’s way. “Family-owned parks can get complacent,” said Mona, of American Resort Management. “It is always nice to see someone who is successful stay successful.”

E D P A L A T T E L L A can be reached at 870-1813 or by e-mail. Follow him on Twitter at twitter.com/ ETNpalattella.

10K | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ERIE 2016

Future: Erie’s resilience key to its success Continued from 8K tourist town,” the worker said. He wasn’t entirely wrong. For all the manufacturing jobs that remain — and there are more than 22,000 people who make things in Erie — Erie’s tourism sector continues to grow. From the Courtyard by Marriott taking shape on the bayfront to EXTRA: To see Scott Enterprises’ plans for a new adventure park more photos of in Summit Township, Erie projects under continues to bolster its case construction, as a vacation destination. including on But not even the most Erie’s bayfront, enthusiastic champions of go to GoErie. tourism suggest that tourcom/photos. ism is anything more than one leg of our economy. We can only guess at what the future will hold for Erie. Where will we work? What will we do? More than most, Jeff Parnell, executive director of the Erie Technology Incubator at Gannon University, might be catching a glimpse of the years ahead as he works with incubator tenants. For the most part, he likes what he sees. “I think Erie is making progress,” he said. “I encounter more and more entrepreneurs who are passionate.” More importantly, he said, there’s something behind that passion. “The quality of the companies we have at ETI is at an all-time high,” he said. “We have 20-plus companies, and many of them are Silicon Valley-caliber.” But does Parnell see in any of those entrepreneurs the makings of the next Lord Corp., the next Erie Insurance? Parnell’sview is thattheydon’t havetobe. He’s not looking for the next Zurn or Sterisonthehorizon.Heishoping,however, that a number of these fledgling firms will take root and grow into profitable midsize companies. Maybe they will be solid, fly-below-the-radar companies like KleinPlating. It is a vision of an Erie that does not have all of its economic eggs in one basket. It’s a hope that seems well within reach. A lot of those new companies, Parnell said, “are off to a really good start.”

J I M M A R T I N can be reached at 870-1668 or by e-mail. Follow him on Twitter at twitter. com/ETNmartin.

FILE PHOTO JACK HANRAHAN/Erie Times-News

FILE PHOTO ANDY COLWELL/Erie Times-News

RECENTLY AT THE BAYFRONT CONVENTION CENTER: At left, gymnasts gathered Jan. 16 for the 15th annual Stars and Stripes Gymnastics Invitational. At right, dogs and their handlers visited Erie for the Erie Kennel Club All-Breed Dog Show on Jan. 30.

Center stays busy

CONVENTIONS:

Facility foresees continued growth By KEVIN FLOWERS kevin.flowers@timesnews.com J. David Henderson’s employer has been to the Bayfront Convention Center several times for large meetings — and is scheduled to return again soon. “We just like the facility, and they do an excellent job there,” said Henderson, district director of American Federation of State, County and Municipal Employees Local 2666. The AFSCME union plans to host large meetings/conventions at the Convention Center in September, as well as in November 2017. Henderson said each meeting could draw as many as 250 attendees. “The atmosphere is good, and the feedback we always get from our people is very positive,” Henderson said.

Officials involved with booking events at the Convention Center, located at the foot of Sassafras Street, say that the 145,000-square-foot waterfront facility has hosted more than 2,900 events of various types since it opened in 2007, said Jeff Esposito, the Convention Center’s general manger. Those events brought nearly 1.1 million people to the Convention Center, Esposito said. And officials expect that success to continue. Erie Events, which oversees the Convention Center, as well as event planners and meeting recruiters from VisitErie,theregion’stourism agency, recently announced that a total of 17 conventions are planned in 2016 and 2017. In addition to the AFSCME meetings, the Pennsylvania Fish and Boat Commission, a statewide police chiefs organization and the County Commissioners Association of Pennsylvania are among the groups planning to come to Erie’s waterfront for conventions in 2016 and 2017.

The Convention Center will benefit later this year when the 191-room Courtyard by Marriott hotel opens. The hotel is currently under construction adjacent to the Convention Center. The new hotel will complement the eight-story, 200-room Sheraton Erie Bayfront Hotel, which is connected to the Convention Center by an overhead public walkway. “I’m encouraged by what’s happening,’ said Casey Wells, Erie Events’ executive director. “And I’m convinced that as more people experience our facilities, it will lead to increased interest and results.” John Oliver, president of VisitErie, recently said that the scheduled 2016-17 conventions will have a regional economic impact “in the millions, “ although an exact estimate was not available. The hotels “help us go after larger groups, and make us more competitive” in the convention business, Oliver said. Scheduled events in 2016 include the Pennsylvania

Chiefs of Police Association meeting in July; a Frontiers in Education conference in October; AFSCME union’s Council 85 conference and a Pennsylvania Fish and Boat Commission convention, both in September; and the Thirst youth convention in November. Conventions booked for 2017 include the Pennsylvania Music Educators, in April; Pennsylvania Athletic Trainers and the Pennsylvania Orthopedic Society, both in May; the County Commissioners Association event, in August; and another AFSCME meeting in November. Seven additional conventions are scheduled, but they have yet to be publicly announced by the organizations booking them, said Elizabeth D’Aurora, coordinator of communications for Erie Events, formerly the Erie County Convention Center Authority.

K E V I N F L O W E R S can be reached at 870-1693 or by e-mail. Follow him on Twitter at twitter.com/ETNflowers.

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ERIE 2016

SECTION

JACK HANRAHAN/Erie Times-News

Donald Wensel prepares copper gaskets to be plated in gold at Klein Plating Works. The 100-year-old business overcame several rough years, Chief Executive Joe Dudenhoeffer says, but is now “doing very well” and looking to the future.

Testing their

METAL Klein Plating Works overcomes hurdles, emerges strong to celebrate 100 years

INDUSTRY: Grass pellets a boon for farmers, drillers and company. 8L

WINE BUSINESS: Man who led effort in state still active as a grower, vintner, mentor. 10L

By RON LEONARDI ron.leonardi@timesnews.com Klein Plating Works is a familyowned business that quietly celebrated its 100th anniversary in 2015. Joe Dudenhoeffer, 38, the company’s chief executive, is a fourth-generation owner whose career at the Erie-based business began with mowing and weed-trimming duties when he was 8. “We’ve never been a company that seeks fanfare and publicity,’’ Dudenhoeffer said. “What we want is to continue to be here in the community giving good-paying jobs that are stable and to be a good community player.” Klein Plating Works produces and supplies precious metal finishing,

➤ Please see KLEIN, 4L

ALSO INSIDE THIS SECTION:

• GE: Layoffs leave future uncertain. 2L • MANUFACTURING: Making our mark. 5L • TOP 50: Workforce is shifting. 9L

ERIE 2016

2L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

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Brad Kopp, left, and Mike Anderson leave GE Transportation in Lawrence Park Township after their work shifts on Nov. 6, the day officials announced plans to cut 1,500 jobs.

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On Nov. 6, the day GE Transportationannounced a plan to cut 1,500 jobs in Erie, a key company official expressed hope that some of those layoffs would be temporary. Today, more than three months later, the Erie community continues to hope that’s the case. But as employees continue to leave their jobs at Erie County’s largest employer, it seems as if the answer won’t be apparent anytime soon. It was Richard Simpson, vice president of the company’s global supply chain, who said the company has a strong record of calling workers back following a layoff. Simpson, who outlined the rationale for the company’s layoff, said there weren’t enough orders in the company’s production schedule to provide work for the 3,200 hourly workers the company had locally in November. But history suggests that could change. Past layoffs at the company’s Lawrence Park Township plant have sometimes been shortlived. And in some cases, planned layoffs were never fully implemented. In 2013, for instance, the company announced plans to cut 950 union jobs and 100 salaried positions in Erie. A year later, by which time less than half of the layoffs had taken place, the company began calling workers back to help tackle a growing book of orders. Simpson didn’t rule out the possibility that something similar could happen in this case. “I think we have an excellent history when it involves recalls,” he said. “I’m optimistic.” But a good track record for recalling workers doesn’t mean the company will call them back before they are needed. The plan to downsize

3,200

That’s how many hourly workers GE Transportation had at its local plant, before it announced plans to lay off 1,500 of them.

I can’t say that I would ever see a full callback. My hope would be that both labor and management look at new lines of business and new lines of opportunity for GE in Erie.” — BARBARA

CHAFFEE, PRESIDENT OF THE ERIE REGIONAL CHAMBER AND GROWTH PARTNERSHIP the Erie workforce was based on a light production schedule in 2016. That reality didn’t change a few days later, when India Railways confirmed that it had agreed to buy 1,000 diesel locomotives for $2.6 billion. That should, by all rights, be good news for GE Transportation workers in Erie, which has been designated as the primary build site for building locomotives for export. But it will take time for those orders to move into the production pipeline. Simpson has said that there is design work to be done, and that those locomotives won’t likely be built until 2017. And even then, there’s no guarantee that the majority of the work will be done in Erie. Scott Slawson, president of Local 506 of the United Electrical, Radio and Machine Workers of America at GE Transportation, has said he’s hopeful but is taking nothing for granted. “Before, we weren’t competing with ourselves with a plant in Texas,” he said, referring to the company’s nonunion plant in Fort Worth, Texas. There is little need to speculate on the importance of this layoff. In the short term, the lost wages of 1,500 workers for one year, at an average

wage of $34 an hour, works out to be $106 million. In a broader sense, the company detailed its impact on the local economy in a 2011 study conducted by the Pittsburgh-based consulting firm Tripp Umbach. Among other highlights, the study found that $1 of every $130 in the state’s economy is generated by GE Transportation, which helps to pump $2.7 billion a year into the Erie County economy. Barbara Chaffee, president of the Erie Regional Chamber and Growth Partnership, is hopeful that Erie County’s largest employer will rebound after this layoff and maintain its position as a key driver of the local economy. “I tend to be an optimistic person. However, the marketplacehaschanged,” she said, explaining that low energy prices could depress locomotive orders for some time. But the order from India Railways presents an opportunity, she said. “The challenge is that now we have two plants that build locomotives,” she said. And with Caterpillar Inc. expected to introduce a new locomotive in the next year or so, competition is likely to increase. “I can’t say that I would ever see a full callback,” she said. “My hope would be that both labor and management look at new lines of business and new lines of opportunity for GE in Erie.” Chaffee, however, expects GE Transportation to remain a force in Erie, where the company that would become GE Transportation was launched more than 100 years ago. “My belief is they have continually shown their commitment to this community,” she said.

J I M M A R T I N can be reached at 870-1668 or by e-mail. Follow him on Twitter at twitter.com/ ETNmartin.

$106M $2.7B That’s about how much spending power will be taken out of the local economy with the loss of those 1,500 jobs.

That’s about how much GE Transportation helps pump into Erie County’s economy each year, according to a study.

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 3L

4L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

WHAT THEY MAKE

ERIE 2016

Klein: 100 years Continued from 1L

Aluminum poles plated with copper and silver by Klein Plating Works will be used in the electrical power industry.

Gold-plated trigger parts will be used by Remington. Klein Plating Works also provides products to a variety of industries, including aerospace, automotive, telecom, connector, military, medical, semiconductor, microwave/ radio frequency technology.

primarily gold and silver, to numerous industries and employs about 50 people at its 32,000-square-foot plating facility at 2020 Greengarden Road. Founded in 1915 by German immigrant Frank Klein — Dudenhoeffer’s great-grandfather — the company was originally known as Erie Gold & Silver Co. and was located at West 25th and Poplar streets. Dudenhoeffer’s father, Larrie Dudenhoeffer, bought Klein Plating Works in 1982 from Dick Klein, a son of Frank Klein. When the elder Dudenhoeffer retired in 2006, he handed the reins to his son. Joe Dudenhoeffer, then 28, remembers taking command of the business under trying circumstances. In 2006, Dudenhoeffer said, Klein Plating and the finishing industry were still feeling the impact of the tech bubble burst that led to the 2000 stock market crash. “When that bubble broke, everything went down,’’ Dudenhoeffer said. “It was quite a struggle.’’ But not the last one. A devastating fire in a shop area at Klein Plating Works on May 11, 2003, forced the business to close for three months. Damages totaled more than $1 million, Dudenhoeffer said. At that time, the economy was soft, and that same year, Klein Plating had a major customer declare bankruptcy. “I was kind of baptized in fire here,’’ Dudenhoeffer said. “When I took over, we were struggling through the fire. I had a business degree and an MBA, but they don’t teach the life lessons. We had to get back on our feet, but I would pray to God at night that we could meet payroll in 2006. “That kind of steeled me to the fact that we have to do everything better here,’’ Dudenhoeffer said. “We have to be more efficient. We

JACK HANRAHAN/Erie Times-News

Employee Paul Webber plates aluminum cylinders in copper and silver at Klein Plating Works, 2020 Greengarden Road. The business, which recently celebrated its 100th anniversary, is now run by its founder’s great-grandson.

I was kind of baptized in fire here. When I took over, we were struggling through the fire. I had a business degree and an MBA, but they don’t teach the life lessons.” — JOE DUDENHOEFFER have to be more conservative.’’ That first year as president was difficult. “I had ulcers then,’’ Dudenhoeffer said. “It was not fun. All my friends at the time were still going to the bars and were still the same old guys. Here I was, basically a nervous wreck. I look back now and think, ‘How did I make it through that?’’’ Dudenhoeffer said his top priori-

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ties in 2006 were meeting weekly payroll and making sure Klein Plating could survive “day by day.” “There was a day where I think we had $38 in our checking account,’’ he recalled. “I’ll look at that and just remember where we were and where we came from. ... It humbles me and gets me going. I never, ever want to go back to those days.’’ Inheriting the presidency of his

company under difficult circumstances would ultimately help spur Dudenhoeffer and his business on to greater success, he said. “We’ve been very successful. Our most success ever in the history of our company is in the last 10 years. But that’s the past to me. We’re living in the present, and what’s tomorrow. Our biggest thing is I have 50 people here whose families depend on us. We have to make sure we’re going to be here and to keep providing.’’ The company’s business model is built on providing products to a variety of industries, including aerospace, electronics and tele-

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 5L

Continued from 4L communications. “It didn’t happen overnight, but we are doing very well now,’’ Dudenhoeffer said. “It’s not something that I want to rest on our laurels with. We’ve done well, but what are we going to do tomorrow? Even if everything is working right now, we can do it better.” Dudenhoeffer had dreams of being a doctor or physical therapist, but he instead chose to run the family business. “I took it upon myself not to see my dad’s legacy, and the people before him, just get sold out or EXTRA: To bought out, or get a closer closed doors,’’ Dudenhoeflook at the Klein plating fer said. “I said I’m goprocess, go ing to try and to GoErie. keep this com/photos thing going, and GoErie. so it kind of com/video. changed my career path.’’ Dudenhoeffer said he and his employees have evolved and developed together in the past decade. “It was sink or swim,’’ he said. “Either you make this successful, or you’re not going to be here. You roll your sleeves up, get out there, and we were lucky and made it successful. We have a lot of good people here. We all realized the situation. We dug in and made everything count.’’ That mentality has been a hallmark for four generations, he said. “We’re not an institution, so we’re not so big that we can’t fail,’’ Dudenhoeffer said. “Every generation that came in here had to take the company to the next level and had to keep getting better. If not, we would have been part of the statistics where most second-generation family businesses fail.’’

R O N L E O N A R D I can be reached at 870-1680 or by e-mail.

FILE PHOTOS/Erie Times-News

From left, meters made at FMC Technologies; plastic caps made at Viking Plastics; and French bread pizzas made at Better Baked Foods.

Erie makes its mark

By JIM MARTIN jim.martin@timesnews.com

Erie’s best known product — a 4,400-horsepower GE Transportation locomotive — tips the scale at a hefty 440,000 pounds. But that’s not all that’s being built behind the walls of Erie’s shops, factories, foundries, plants and mills. It’s often said that Erie isn’t the manufacturing town it used to be. And there’s no question that the numbers are down. Manufacturing employment is thought to have peaked here in 1974, a year that saw more than 50,000 people earn a living on Erie’s shop floors. Today, that number stands at 22,900, according to the state Department of Labor & Industry. In the short term, it’s expected to fall further as GE Transportation, Erie County’s largest employer, moves ahead with a planned layoff of 1,500 workers. But Erie’s status as a manufacturing center won’t end, even if those cuts prove to be permanent — and it’s not certain that they will. Even now, after 40 years of declining manufacturing employment, Erie County residents

There is a corporate trend in America today to suppress wages. ... Until something changes or someone intervenes, we are just going to continue down this path.” — SCOTT SLAWSON, PRESIDENT OF UE LOCAL 506

hold jobs in manufacturing at nearly twice the national rate, according to statistics from the Economic Research Institute of Erie. And it’s not just giant locomotives that we’re building. Erie workers build meters that measure oil flow at FMC Measurement Solutions, tiny plastic caps for automotive air conditioners at Viking Plastics, deodorant containers at Plastek Industries, precision parts for medication delivery systems at Plastikos and flight-sensitive anti-vibration parts at Lord Corp. Maybe you’re more a fan of big, heavy machines. Folks in Erie build and maintain massive ships at Donjon Shipbuilding and Repair, and they machine the massive drive shafts that propel navy ships at Erie Forge and Steel. Much of what’s made in Erie is shipped around the world, including a range of sorting

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equipment made at Eriez Manufacturing. Sometimes manufacturing means food, whether that’s the 425,000 French bread pizzas churned out daily at Better Baked Foods in North East or the truckloads of potato chips and popcorn made 24 hours a day at the former KLN plant, now owned by Shearer’s in Waterford. The good news, according to a study by the Jefferson Educational Society, is that Erie has more than its share of jobs that can be classified as advanced manufacturing. These are manufacturing jobs that rely on advanced technology and tend to pay better than others. Scott Slawson, president of Local 506 of the United Electrical Radio and Machine Workers of America at GE Transportation, worries that it won’t last. It’s not just the layoffs at GE that give him pause.

Like others in Erie, he can’t shake the memories of companies that left, and workers who were forced to start over. “There is a corporate trend in America today to suppress wages,” he said. “It’s a huge deal. These companies are passing their social burdens on to the taxpayers. Until something changes or someone intervenes, we are just going to continue down this path.” Many would argue his point, contending that union wages and benefits have driven jobs south and offshore. There won’t soon be agreement on that point. But on another point, the facts leave little room for debate. The city where Daniel Dobbins built the fleet that Oliver Hazard Perry commanded in the Battle of Lake Erie is still making things today, from the boat oars that move us through the water and the salad dressings that top our lunch to the precision parts and pieces that keep airplanes in the sky.

J I M M A R T I N can be reached at 870-1668 or by e-mail. Follow him on Twitter at twitter.com/ ETNmartin.

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 7L

6L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

Saint Vincent Hospital Expanding in our Community

The 44,000 square foot medical pavilion is expected to be completed in Spring of 2016.

Saint Vincent continues to remain a leader in health care in the Erie region. We have made it our priority to meet patient needs, values, and preferences. So that a patient’s care is delivered in the right place, at the right time, and in the manner that best suits a patient’s needs. That is why in 2016, we are proud to introduce the Allegheny Health Network, Health + Wellness Pavilion West Side. A new $12 million facility, that will bring Saint Vincent services and providers to Erie’s Westside in one convenient location. Providing state-of-the-art facilities and access to the latest in cutting-edge imagery and diagnostics. The Health + Wellness Pavilion will provide services including: Saint Vincent Urgent Care Saint Vincent Imaging Center Family Medicine Pediatrics

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8L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

A growing effort

How IT woRkS

INDUSTRY: Grass

pellets a boon for drillers, farmers, Crawford company

Switchgrass — a hardy, tallgrowing grass — is planted on 4,000 acres.

By VALERIE MYERS valerie.myers@timesnews.com

PHOTOS BY ANDY COLWELL/Erie Times-News

Water vapor rises from the Ernst Biomass facility behind switchgrass growing in a demonstration field at Ernst Conservation Seeds and Ernst Biomass in Union Township, Crawford County. Similar switchgrass grown across 4,000 acres is processed into pellets at the plant. Six of Ernst’s approximately 80 employees work in the company’s biomass operation, begun nine years ago for ethanol production and heating. Pellets now are sold almost exclusively for absorption, Arnett said. “The energy content is almost as good as wood, but in absorption, grass is far superior to hardwood,” Arnett said. The pellets are made from switchgrass grown on 4,000 acres, about 2,000 of which are leased from local farmers. “Farmers can use land that’s marginal for traditional row crops and make it productive with switchgrass. The business has been a boon to a lot of local landowners with property that they had not been farming,” Arnett said. The 4,000 acres yield about 10,000 tons of grass for processing annually. Grass is harvested and

bundled into 800-pound bales for storage and transport to Ernst’s $5 million tarp-and-steel processing facility capable of producing 25,000 tons of pellets a year. At the processing plant, grass is ground, dried, formed into pellets and packaged in 1-ton bags for industrial clients in Pennsylvania, Ohio and West Virginia and in smaller, more manageable bags for horse owners as far away as Louisiana. The plant ships two tractor-trailer loads of pellets daily. “We’re the only plant that produces fiber on this scale,” Arnett said. Bedding for animals other than horses could provide new markets for the pellets. Pellets have been tested by the University of Delaware as bedding for broiler chicken operations in the Delmarva Peninsula, and results so far are positive. “It seems to improve the health

visit our new store presque isle wine cellars in the shops at the colony

Presque Isle Wine Cellars has been part of the Erie Community for generations. Our founder, Doug Moorhead, led the effort to establish the wine industry in Pennsylvania resulting in the creation of the Lake Erie Wine Region and a major tourist attraction.

of the chickens,” Arnett said. Horse owners report other benefits of pellet bedding, sold as Thorobed. “Champion horse owners have been using the pellets for a number of years now and are telling us things like they no longer have to bathe a horse during fair week. Their animals are staying dry and clean,” Arnett said. Ernst Conservation Seeds will continue to study and devise new uses for the organic pellets, Arnett said. “One of the coolest things is that this could be reproduced in many communities in Pennsylvania, compared to much bigger capital projects that are suited to very few,” he said.

V A L E R I E M Y E R S can be reached at 878-1913 or by e-mail. Follow her on Twitter at twitter. com/ETNmyers.

The grass is harvested then bundled for transport to the processing plant, where it is dried and made into pellets.

The pellets are packaged, either in 1-ton bags, like the one shown with employee Evan Beatty, or into smaller bags before being shipped out to customers. EXTRA: See more of Ernst Biomass at GoErie.com/video or GoErie.com/photos

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MEADVILLE — Native grasses grownatErnstConservationSeeds in Union Township and on leased land nearby are mopping up waste from the Marcellus Shale. The grasses are dried, ground and shaped into pellets inside a multimillion-dollar plant built on the Ernst farm, alongside buildings where more than 400 species of native and naturalized seeds are stored. Those woodlike pellets, originally envisioned as fuel for heating, are being used primarily to absorb moisture and make it easier to dispose of liquids displaced by drilling. And despite a slight downturn in Ernst Biomass sales and a slowdown in the oil and gas industry in 2015, Ernst’s market share of pellet sales to the industry grew, said Dan Arnett, the company’s biomass manager. The pellets are also used as horse bedding. “We’re working on a few additional markets for 2016,” Arnett said. Ernst Conservation Seeds has a tradition of anticipating demand. Founded by Calvin and Marcia Ernst 52 years ago, the farm’s original cash crop was crown vetch sold for planting along the nation’s highways to revegetate and control erosion in medians and rights of way. The company has since reinvented itself as the nation’s largest provider of conservation seeds for plantings to rebuild wetlands; to reclaim land damaged by mining, drilling and pipelines; and to provide animal habitat and native pollination.

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ERIE 2016

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 9L

WHERE WE WORK: List of Erie’s top employers reflects more diverse group

Workforce shifting? Working in Erie region Who employs the most in Erie County? 2015 2005 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50

1 2 3 6 5 4 8 7 9 11 10 17 15 21 12 22 30 34 18 38 14 24 42 26 36 28 29 46 33 20 49 35 44

GE Transportation Erie Indemnity Co. UPMC Hamot Pennsylvania state government Wal-Mart Saint Vincent Hospital U.S. government Erie School District Erie County government Dr. Gertrude A. Barber National Institute Presque Isle Downs & Casino Millcreek Township School District Lord Corp. City of Erie Country Fair Inc. Plastek Group Inc. Pennsylvania State University YMCA of Greater Erie Tamarkin Co. Gannon University Regional Health Services Inc. State System of Higher Education (Edinboro University) Millcreek Community Hospital Mercyhurst University Infinity Resources Inc. Wegmans Lakeshore Community Services Voices for Independence Saint Vincent Medical Education & Research Institute Saint Mary’s Home of Erie Erie Homes for Children and Adults Inc. Barber National Institute McDonald’s restaurants Waldameer Park Inc. Pleasant Ridge Manor Lowes Home Centers Inc. Stairways Behavioral Health Welch Foods Inc. Associated Clinical Laboratories Career Concepts Staffing Services Parker-Hannifin Corp. Port Erie Plastics Inc. Harbor Creek School District Agility Marketing Group Eriez Manufacturing Co. LECOM Northwest Bancshares Inc. Adeco USA Inc. Parker White Metal Co. Northwest Tri-County Intermediate Unit

By JIM MARTIN jim.martin@timesnews.com

Wal-Mart, the nation’s largest employer, became Erie County’s fifth-largest employer in 2015, displacing Saint Vincent Hospital from the top five. That news, from the state Department of Labor & Industry, represents a slight shift in what’s been a slow-changing group of Erie’s largest employers. That list, perpetually led by GE Transportation, also includes UPMC Hamot, Erie Indemnity Co., state government, and now WalMart, which has pushed Saint Vincent Hospital into the sixth spot. There is the potential that the next year could bring even more reshuffling of the top five spots. GE Transportation, which has been Erie County’s top employer for decades, announced in November that it planned to reduce its hourly work-

It seems to me that Erie is better at weathering recessions. Partly that is due to the fact that manufacturing ... has become a smaller segment of the local economy.” — JIM KURRE force by 1,500 people, which would reduce the company’s overall Erie employment from 4,500 to about 3,000. Those cuts would push employment at GE Transportation closer to the 2,800 who work for Erie Indemnity, the management arm of Erie Insurance. For now, however, GE Transportation remains on top of the list and one of three manufacturing companies among the top 20 employers. The small number of manufacturers has been linked to a decline in local wages as compared with the national average. WhileErie wages continue to rise, they aren’t rising at the same rate as wages

nationally, said Jim Kurre, director emeritus at the Economic Institute of Erie at Penn State Behrend’s Black School of Business. But the news isn’t all bad. The Erie to which Kurre arrived in the 1970s was heavily dominated by manufacturing and was notoriously susceptible to downturns in the economy. Recessions that lasted six months nationally would last twice as long in industry-dominated Erie. A look at Erie County’s top50employers—agroup that includes manufacturers, hospitals, government, social service agencies and local colleges — speaks to the diversity of the local economy.

In some respects, that diversity has served us well. “It seems to me that Erie is better at weathering recessions,” Kurre said. “Partly that is due to the fact that manufacturing, which tends to be much more cyclical, has become a smaller segment of the local economy.” The bad news, he said, is that our current mixture of employers isn’t delivering the growth in wages he would like to see. The rise of one employer — state government — on the top 50 list gives Kurre no special joy, especially after a budget deadlock that has continued for months. More broadly, he said, Erie’s growing economic diversity is evening out some of the rough spots.

J I M M A R T I N can be reached at 870-1668 or by e-mail. Follow him on Twitter at twitter.com/ ETNmartin.

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Crawford County’s top 5 employers 1 2 3 4 5

1 2 3 7 4

Meadville Medical Center Pennsylvania state government Crawford County government Wal-Mart Crawford Central School District

All top employers are as of the second quarter 2015, the most recent data available, compared to the first quarter of 2005.

Erie County average occupational wages (2014)

Erie County residents make $7,730 less, on average, than their counterparts in the state: Erie County

Pennsylvania

$38,020 $45,750 INDUSTRY AVERAGE WAGE IN ERIE COUNTY Management ...................................................... $93,130 Legal..................................................................... 80,990 Life, physical and social science .......................... 73,620 Architecture and engineering ............................... 67,980 Health-care practitioners and technical ................ 66,150 Computer and mathematical ................................ 59,680 Business and financial.......................................... 57,840 Education, training and library.............................. 49,730 Protective services .............................................. 43,680 Construction and extraction.................................. 42,490 Community and social services ............................ 39,220 Arts, design, entertainment, sports and media ..... 37,640 Installation, maintenance and repair .................... 37,620 Farming, fishing and forestry................................ 34,860 Production ............................................................ 34,800 Sales and related occupations ............................. 31,650 Transportation and material moving ..................... 31,100 Office and administrative support ......................... 31,020 Health-care support .............................................. 24,610 Personal care and service .................................... 22,750 Building, grounds cleaning and maintenance....... 22,170 Food preparation and serving related jobs ........... 19,680

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Erie County jobs, by sector (in November) SERVICE-PROVIDING 105,800 jobs (80% of jobs in county)

Leisure, hospitality: 9.9% Government: 12.1%**

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Trade, utilities, transportation: 17.7%

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Mining, logging, construction: 3%

Education, health: 22.3%

Manufacturing: 16.9%

*Includes business services. **Federal, state, and local. SOURCE: Pennsylvania Department of Labor & Industry

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Information: 0.9% Other services: 4.7% Financial activities: 5% Professional services: 7.5%*

10L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ERIE 2016

‘Father’ of the industry Wine: Man who

by the numbers

led effort in state active as grower, vintner, mentor

About the wine and grape industry in Pennsylvania:

$1.9 billion:

By KARA MURPHY Contributing writer Doug Moorhead is perhaps most comfortable in his family vineyard, coaxing along the European grapes he introduced to Lake Erie in the 1950s. But it is his work on the Pennsylvania Limited Winery Act that might stand as his most far-reaching legacy. Moorhead, owner of Presque Isle Wine Cellars, was one of the winemakers who led the drive to get the 1968 act passed, allowing Pennsylvania wineries to sell wine directly to customers and paving the way for the more than 200 wineries in the state today. “Doug was instrumental in all of that early period,” said Hudson Cattell, a journalist who has covered the eastern U.S. wine markets for decades. Cattell is the author of numerous books about the wine industry, including “Pennsylvania Wine: A History,” in which he writes at length about Moorhead’s involvement in the passage of the Pennsylvania Limited Winery Act. In the book, Cattell documents how Moorhead, along with thenpartner William Konnerth and the three partners who created Penn Shore Winery — George Luke, P. Blair McCord and George Sceiford — overcame hurdle after hurdle put in place by the Pennsylvania Liquor Control Board, which was reluctant to allow wineries to sell their own products. “The emphasis was on the word ‘control,’” Moorhead mused, as he remembered the battles with the PLCB. Now 82, Moorhead is still very active in his winery’s day-to-day

That’s the full economic impact of Pennsylvania wine, wine grapes and juice grapes.

8,629:

That’s the number of full-time equivalent jobs.

$401 million: That’s the wages paid.

$222 million: SARAH CROSBY/Erie Times-News

Doug Moorhead, owner of Presque Isle Wine Cellars, was a leader in getting the state’s Limited Winery Act passed. Today, he grows grapes and supplies winemaking equipment, as well as making wine — like the 2014 chardonnay here. operations. His wife, Marlene, who took over as his partner when Konnerth retired in 1974, also is a key member of the business.

‘The first person they go to’ Along with growing grapes and making wine, Presque Isle Wine Cellars has a thriving business selling winemaking equipment to both home winemakers and commercial operations. In fact, selling equipment is how the winery got its start back in 1964, four years before the legislation passed. The winery still maintains a large catalog selling the equipment needed to make everything from wine and Champagne to beer and hard cider. Moorhead didn’t stop being a leader in the wine industry after passage of the 1968 legislation.

He has always been willing to take on leadership roles, said Jennifer Eckinger, executive director of the Pennsylvania Winery Association. Among the important roles cited by the Eastern Winery Exposition when it awarded Moorhead a Lifetime Achievement Award in 2013: He was one of the founding members of the Pennsylvania Wine Association and served as its executive director and on its board; he chaired the industry advisory committee of the Lake Erie Regional Grape Program; he was a longtime director of the National Grape Cooperative, which owns Welch’s Foods; he was an adjunct professor in the culinary department at Mercyhurst College; and he is currently a director of WineAmerica and the Pennsylvania Grape Marketing Board. But it is simple mentorship

that might be Moorhead’s most important role to local winemakers. “He’s a great supplier,” said Bob Mazza, owner of Mazza Vineyards Winery in North East, Mazza Chautauqua Cellars in Mayville, N.Y., and the Five & 20 Spirits & Brewing in Westfield, N.Y. “And since he sells supplies, he gets a lot of questions from people with aspirations of being winemakers. He is the first person they go to.” Eckinger echoed that sentiment. “He’s always available to answer questions,” she said. “He continues to give for the good of the industry and always looks out for the good of the industry.”

Room for more wineries Moorhead described the relationship between wineries in the

That’s the winerelated tourism expenditures.

SOURCE: 2011 Pennsylvania Winery Association economic impact study, released in 2013

Lake Erie region as “collegial.” “We’ve realized a rising tide raises all boats,” he said. He and Mazza said they believe the region, which is now home to 24 wineries, can support many more. “I think we can get to 50 before we start cannibalizing each other,” Moorhead said. “The potential is there.” Statewide, there are now more than 200 wineries, the owners of which have all likely toasted Moorhead during their time in business, Eckinger said. “Doug’s work on the Pennsylvania Limited Winery Act was essential to its success,” she said. “He is, quite simply, the father of the modern wine industry in Pennsylvania.”

K A R A M U R P H Y is a freelance writer in Erie. Contact her at www.karawrites.com.

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 11L

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12L | Erie Times-News | GoErie.com | Sunday, February 14, 2016

SUNDAY

February 14, 2016

ERIE 2016

UNDER

Annual economic report for the Erie region

By JIM MARTIN jim.martin@timesnews.com

ne grew up in rural poverty and went on to serve two tours of duty in Iraq before eventually finding his way to Erie, where he works today as a social worker and serves on Erie County Council. Another is a medical doctor who quit practicing after inventing a device that could help people sleep better at night. Today, she runs a growing, award-winning company with 25 employees. Yet another was born in Kuwait and worked as an engineer in Buffalo before going on to become a lawyer. Today, he specializes in patents and intellectual property and devotes much of his time to working with entrepreneurs. The fourth is an Erie native and graduate of

Erie’s Central Career and Technical School who found herself with plenty of choices after she graduated from Colgate University. She chose Erie, where she serves as a vocal advocate and fundraiser for the city’s public schools. In a community not known as a magnet for outsiders, three of these four people, all of them under the age of 40, moved to Erie as adults. We won’t suggest for a moment that these four 30-somethings are the only members of their generation chalking up successes in the business community or helping to shape Erie. We sorted through a long list of other compelling suggestions, including leaders in business, government, education and medicine to arrive at this list. All four of these people have one thing in common: They’re aren’t waiting for their moment to arrive. STORy CONTINUES, 2M

CLOCKWISE FROM TOP RIGHT: Daria Devlin, 38, is executive director of the Partnership for Erie’s Public Schools and the School District’s coordinator of grants and community relations; Jonathan D’Silva, 39, is a patent lawyer and owner of MMI Intellectual Properties; Wei-Shin Lai, 38, is chief executive of AcousticSheep; Jay Breneman, 33, serves on Erie County Council for the 4th District. Photos by Christopher Millette, Erie Times-News.

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SECTION

ay Breneman, 33, is known by many as a member of Erie County Council. Fewer know the forces that drive him and how a man who spent much of his early life in Montana cattle country came to think of Erie as his hometown. More than anything else, Breneman said, he was shaped by his military service and a childhood spent in poverty. “For a while, we had no running water or electricity.” As a result, he said, “A lot of things are deeply ingrained in me.” If his childhood taught him about empathy, it was his service in the military, where he reached the rank of staff sergeant, that spurred him to take action. “I sat over in the hot desert looking around. I might be serving my country, but I wanted to do something more,” he said. And he wasn’t inclined to waste time. “I was almost afraid to die without having left something,” he said. “I didn’t want to wait 30 years to find myself in a role ... where I could make positive changes.” Breneman, who was elected in 2013, said he’s trying to do that as a member of County Council, where he sees it as his role to “push the conversation forward.” But talk that only maintains the status quo isn’t worth much, he said. “I don’t think the community is where it should be,” he said. “You have a lot of people who are afraid to push things. You have (leaders) who view themselves as more of a caretaker.” Collaboration is often suggested as the answer to Erie’s challenges, including growing concerns about violence. Breneman agrees, but only to a point. “It’s easy to get people to talk about a problem. But it’s hard to get people to commit to a certain action or a timeline. I think we spin our wheels quite a bit as a community.” Still, Breneman said he’s happy to be part of this particular community. “It was home for me from the first day,” he said. “I really love this town, and I don’t see myself going anywhere else.”

ei-Shin Lai trained to be a medical doctor, but she was always an inventor at heart. Lai, 38, began marketing her first invention when she was studying anatomy in medical school. As a study aid, she crafted an origami version of the human pelvis that she marketed as the Paper Pelvis. It wasn’t a product for the masses, but it was purchased by students and midwives. A bigger idea came in 2007 when she and husband Jason Wolfe, a Cambridge Springs native, lived near State College.

Continued

The story is that she was having trouble getting to sleep and her husband suggested she listen to some soft music. Their inability to find comfortable headphones led to designing and making their own. It was the beginning of what would become AcousticSheep, an Erie company that employs 15 people full time and 10 part time. Lai, who no longer practices medicine, has sold her products at the Consumer Electronics Show, been mentioned on television by Dr. Oz and seen annual sales climb into the millions. Although Lai said she’s making more money than she did as a physician, financial success has never been her key motivation. “We kind of have the feeling that by doing what we are doing and getting the word out, it means a lot of people could go to sleep more naturally. It’s almost like we’redoingtheworldabetterservicethan by just focusing on one person at a time.” Lai said she’s excited about introducing more products to a line that already includes headphones for sleeping and running. Lai, whose company has won awards from the Governor’s Office and at the Consumer Electronics Show, said she’s embracing all aspects of her company, including working with employees. “I have a lot of trust in them, and I think it goes both ways,” she said. A native of Taiwan, Lai said she’s become an enthusiastic fan of Erie — even the weather. “The snow is really a lot of fun,” she said. “Once we got our all-wheel-drive vehicle, we were set.”

ERIE 2016

under

2M | Erie Times-News | GoErie.com | Sunday, February 14, 2016

here was little to suggest that Jonathan D’Silva, who was born in Kuwait of Portuguese descent, would

from

wind up working in Erie as an intellectual property lawyer. D’Silva, 39, who was trained as an engineer, never intended to become a lawyer and certainly didn’t plan to move to Erie. It was work that brought him here. While working as a civil engineer for a Buffalo firm, he laid out the sewer lines on Erie’s bayfront and did some work on a sewage treatment plant in Corry. That work led to a relationship with Erie law firm MacDonald Illig, where his contacts encouraged him to attend law school and offered him a job after he graduated. D’Silva said Erie struck him as a place where he could live a balanced life. “I knew I didn’t want that big-city life,” he said. “I wanted to spend time with my family.” D’Silva, who first visited the U.S. at 14, retains a newcomer’s appreciation for the country’s freedoms. “You can do a heck of a lot here that people take for granted. The fact that I have to wait in line for a half-hour at the DMV? You mean I don’t have to bribe someone?” The opportunities seemed almost endless in a community where he could quickly become a key player in the field of patent law and intellectual property, winning the designation of Super Lawyers Rising Star in 2013 and 2014. For D’Silva, a father of four, finding balance has never meant sitting on the sidelines. He was the planner and curator in November for TEDxErie; he serves as chairman of Innovation Erie design competition, vice president of the Purple Martin Conservation Association and president of the board of the Startup Incubator; and he is a former board president of the International Institute of Erie. D’Silva, who likes working with entrepreneurs, has moved into proximity with

a number of Erie’s up-and-coming business owners. He recently left his position at MacDonald Illig to start his own firm, MMI Intellectual Properties, inside the Erie Technology Incubator at 900 State St. He’s encouraged by the progress being made by Erie entrepreneurs, especially in the area of technology. “I feel there is energy here,” he said. It was that energy that prompted D’Silva to take a risk of his own by leaving a job he loved. “It seems to me if everyone else is going to roll the dice, I should, too.”

aria Devlin, an Erie native, graduated with a dual major from Colgate University. She’s far more likely, though, to tell you how proud she is to be a 1995 graduate of Erie Central Career and Technical School. A mother of two, she and her husband, Neil, an Erie lawyer, have the means to send their children to private school. Devlin, 38, said, “I felt as a person who had a choice it was important for me to invest in the district that gave me so much.” Her involvement with the district can be traced back to 2010 when it was in the midst of a budget crisis. Devlin, who had been writing grant proposals for nonprofit organizations, wondered why a public school district couldn’t raise funds the same way. In 2012, after gaining the support of Erie schools Superintendent Jay Badams, Devlin founded the Partnership for Erie’s Public Schools. So far, fundraising efforts have allowed the group to provide a number of minigrants for initiatives that might not otherwise be funded. There’s been money for handbells for Emerson-Gridley Elementary School, and grants to send students at Edison and Perry elementary schools to performances at the Warner Theatre and Erie Playhouse. Devlin, who also works as the district’s coordinator of grants and community relations, hopes to step up those efforts to the point of conducting a capital campaign. She doesn’t think the current funding model leaves much choice. “It’s not about equality; it’s about justice,” she said. “You see the facilities and the opportunities that exist elsewhere. The disparity is the greatest challenge.” Devlin said she wouldn’t be fighting so hard if she didn’t believe in public education and the exposure to people and ideas that it provides. “I honestly believe this is the best education for our children,” she said.

ERIE 2016

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 3M

Big idea, quick results

CROWDFUNDING: Quickstarter helps local campaigns get attention, funding

ABOUT THE

PROJECTS

By KARA MURPHY Contributing writer Quickstarter was the brainchild of a Mercyhurst University professor who saw local entrepreneurs coming up short when they tried to use crowdfunding to finance their new ventures. Kickstarter, one of the best known crowdfunding websites, reports an overall success rate of 36.5 percent for those who seek funding for their ventures. Kris Wheaton, an associate professor of intelligence studies at Mercyhurst, was convinced that a team of students with a range of skills — including video production and copy writing — could help Kickstarter participants succeed far more often. It turns out he was right. So far, the Mercyhurst-based Quickstarterprogramhashelped13 entrepreneurs and nonprofits with crowdfunding campaigns since the end of 2014. Of those, 12 have been successful — a 92 percent rate. “Their knowledge and expertise gets you excited to build your campaign,” said Humble Elephant owner Lisa Van Riper, who used Kickstarter to raise money to produce child-sized patterned rolling pins. “Their guidance and drive goes beyond Quickstarter — their team wants to see you succeed and helps you get there.” Humble Elephant’s team — like most of the other projects — included college students. Depending on the project, Penn State Behrend and Mercyhurst students are hired to help create a successful crowdfunding campaign, Wheaton said. Dozens of students have worked on campaigns, Wheaton said. “It’s all about getting students real work,” he said. “They’re getting paid. They’re expected to be

FILE PHOTOS/Erie Times-News

TOP LEFT: An effort to preserve artifacts at Hornby School raised $1,565 on Indiegogo with 21 backers, 155 percent of the goal. BOTTOM LEFT: Carolyn Beck, left, and Emily Beck dine at Like My Thai in July. The restaurant received $13,684 in Kickstarter funding with 140 backers, 342 percent of the goal. RIGHT: Richard Eisenberg, left, and Jamie Trost are helping to restore the Porcupine, shown under construction in August. A Kickstarter campaign to build and install a deck on the schooner raised $13,177 with 175 backers, 264 percent of the goal. professional. It’s not for a grade, and they have to understand how to manage clients and work with them. This is real-life experience.” Wheaton has been approached by 79 people in the region about starting crowdfunding campaigns. Of those, 13 projects have been completed. Another dozen are currently in the pipeline, he said. While Wheaton can provide plenty of numbers and data on how to make a crowdfunding campaign work, his ultimate goal is less quantifiable. By embracing and encouraging entrepreneurial success, he’s hoping to begin to change the negative mindset he said he believes permeates the region. “My whole goal here is to start to create an environment where people change the way they think of Erie,” he said. “I think we can do

that by not only generating creativity, but by supporting it, embracing it and celebrating it.” Wheaton’s enthusiasm, buoyed by Quickstarter’s success, has led to Quickstarter being recognized as a legitimate enterprise by the Erie County Gaming Revenue Authority and Ben Franklin Technology Partners of Central and Northern Pennsylvania. Both have awarded funds to Quickstarter so it can build on its success. ECGRA awarded $50,000 a year for three years to the Quickstarter program through its Ignite Erie: Industry-University Business Acceleration Collaborative, led by Mercyhurst and Penn State Behrend. Ben Franklin Technology Partners, meanwhile, upped the $10,000 grant it awarded Quickstarter in 2015 to $35,000 in 2016.

“Quickstarter is not only a remarkable vehicle for fundraising, but also for prepping a business for product and service launch,” said Perry Wood, ECGRA executive director. “It’s intimidating to start the entrepreneurial process, and Kris and his team carefully lead business owners to answer critical questions — who will they sell to, how will they sell it, how does that model compare to the competition. ... That type of mentorship can be the difference between early success and failure.” Wheaton said the funding will help pay operating costs for the campaigns, conduct research, and market the program to creators.

K A R A M U R P H Y is a freelance writer in Erie. Contact her at www. karawrites.com.

Here’s how several of the projects Quickstarter was involved with performed on Kickstarter: ▀ “Unearth,” a feature-length horror film created by John C. Lyons. Funding: $22,620 with 257 backers, 151 percent of the goal. ▀ Acoustic Sheep’s SleepPhones Effortless: Wireless Headphones and Chargers. Funding: $65,609 with 496 backers, 656 percent of the goal. ▀ ReCap Mason Jars’ Explore Bug Catcher Kit. Funding: $2,722 with 101 backers, 136 percent of the goal. ▀ Build America’s next highspeed railroad. Funding: $5,222 with 54 backers, 174 percent of the goal. ▀ Kid-sized rolling pins by Humble Elephant. Funding: $1,237 with 25 backers, 494 percent of the goal.

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ERIE 2016

Building a legacy

CONSTRUCTION:

AROUND THE REGION

Company has played a key role in region’s big projects

By DAVID BRUCE david.bruce@timesnews.com Photos of some of the area’s most iconic structures line the walls at E.E. Austin & Son Inc. Some are nearly 100 years old, like the 1924 photo of workers using horse-drawn carts to build Veterans Stadium. Other photos are more recent, such as one of the Tom Ridge Environmental Center’s elevator tower as it was being constructed. “Veterans Stadium was our first big job, along with a similar stadium in New Castle,” said Clemont “Cle” Austin, president of E.E. Austin & Son. “Before that, we were mostly building homes.” It has been 110 years since E.E. Austin, a former schoolteacher and farmer, moved to Erie from southern Erie County and began using wood from his farm to build houses. Now, the company run by his great-grandson helps build multimilliondollar structures, such as the Courtyard Waterfront Hotel on Erie’s bayfront, and renovates historic buildings, such as the former Pennsylvania Armory and the Chautauqua Institution Amphitheater. “Our main business is building,” said Austin, 69. “We supply concrete to

CHAUTAUQUA INSTITUTION: Jason Muscarella, of E.E. Austin & Son, installs boards on the amphitheater ceiling in June.

DAVID BRUCE/Erie Times-News

Clement “Cle” Austin is president of E.E. Austin & Son, the Erie company that his great-grandfather founded more than a century ago. While the founder made his mark building houses, the company today focuses on larger-scale construction. other companies, but our main interest is construction. We focused our efforts in the 1980s, after we got out of the aggregate (sand and gravel) business. We also used to run a hardware store until the 1950s.” Erie-based E.E. Austin & Son currently employs 135 people. The number is down from 190 workers in 2011, due to a decline in company revenue. The downturn is attributed to a reluctance in both the public and private sectors to invest in new buildings, Austin said. “This appears to be the new normal,” Austin said. “We see that municipalities and private companies are very conservative with construction investment. For example, the

Erie School District has announced $200 million of needed improvements, but there is no funding for them.” The company survives by being flexible, Austin said. It helps build and renovate schools, wastewater treatment plants, retail stores, college buildings, hospital expansions and industrial buildings. It also prides itself on doing the job correctly and safely, Austin said. E.E. Austin & Son recently completed the Occupational Safety and Health Administration Challenge Program. The program improves workplace safety and health through a process that includes lessons about safety planning and the implementation of safety

and health-management programs. “The most important part of the program is that every single person with E.E. Austin & Son and our subcontractors will be able to go to work and be comfortable, and not worry about being injured,” Austin said. Austin, a civil engineer, said he plans to lead his great-grandfather’s company for another seven or eight years, if his health is good. “This job energizes me,” Austin said. “I like to get out. I like Erie, and I like the people.”

D A V I D B R U C E can be reached at 870-1736 or by e-mail. Follow him on Twitter at twitter.com/ ETNbruce.

LORD CORP.: Eric Andree, a concrete finisher with E.E. Austin, works at the company’s new Summit Township facility in 2013.

PRESQUE ISLE DOWNS & CASINO: Avery Schou, of E.E. Austin,delivers concrete grout into a pump at the Summit Township site in 2006. FILE PHOTOS/Erie Times-News

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 5M

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Jeff Parnell, Erie Technology Incubator at Gannon

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Erie’s Hero Award presented to H.O. Hirt and O.G. Crawford at the ﬁrst annual Disrupt Erie Awards.

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ERIE 2016

8M | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ENTREPRENEURS: Fairview coffee enterprise gets boost from accelerator program

Business is perking up

By KARA MURPHY Contributing writer

Out of the Grey Coffeehousecafe in Fairview has become a favorite meeting spot — and for good reason. On a recent Saturday night, the fireplace blazed, warming a backroom where deep couches and chairs welcomed visitors to curl up and chat, a warm mug in hand. Now that the coffeehouse, 6990 West Lake Road, is a success, owners Jack and Sheila Barton have set their sights on a new challenge. They’ve launched an online business — also called Out of the Grey — that allows customers to create their own coffee, choosing roasting preferences, flavorings and even a name for their custom blend. In the coming months, the Bartons plan to add additional customizable features — such as creating labels — to the site, which can be found online at www.outofthegreycoffee. com. “When people can create their own coffee, give it a name, it gives them a sense of ownership,” Jack Barton said. “They love the concept of fully customizing their drinks.”

‘People can be skeptical’ The Bartons’ unique business idea caught the attention of Jeff Parnell, executive director of the Erie Technology Incubator. Parnell invited Jack Barton and 11 other entrepreneurs to take part in Gannon University’s inaugural Technology Business

ANDY COLWELL/Erie Times-News

Out of the Grey Coffeehousecafe patrons line up to place orders with co-owner Jack Barton at the Fairview Township shop. Barton and his wife have launched a new effort to allow customers to create custom blends of coffee. Accelerator in 2014. Barton said when he first got the call inviting him to take part in the accelerator program, he thought it was a sales pitch. He avoided the calls and e-mails until Parnell finally convinced him it was a legitimate opportunity. Parnell said he gets that reaction from entrepreneurs frequently. “People can be skeptical,” he said. “Entrepreneurs aren’t used to trusting other people with their information or ideas, and they think we’re calling to try to get them to reveal information, to take ideas,

or compete. I have to convince them that, no, we really want to help.” The entrepreneurs who go through the eight-week accelerator course pitch their ideas to a panel of judges at the end of the program. Barton won the inaugural year, taking home a $10,000 check and six months of residency, coaching and strategic mentoring from the Erie Technology Incubator. Now, more than a year later, Barton still meets regularly with his mentoring team, a benefit he now pays for. “They really care about

what we’re doing. They’re encouraging. They hold us accountable. They’ve inspired us to go further,” Barton said. “What they’ve done for us is priceless.”

‘Life-changing experience’ The fifth accelerator class begins Feb. 17, Parnell said. Barton said he has a simple message for the new participants, and other area entrepreneurs or people who have a business or want to start one: Use Erie’s resources. “I never went to (Gannon’s Small Business De-

velopment Center) before the accelerator program,” he said. “I didn’t know what it had to offer. And it’s not just money. That’s a shortsighted look — it’s the accountability, the direction, the excitement from other entrepreneurs. People are so generous with their ideas and their knowledge — they’ve changed what I think about, what questions I ask myself — it’s really been a life-changing experience for us.”

They really care about what we’re doing. They’re encouraging. They hold us accountable. They’ve inspired us to go further. What they’ve done for us is priceless.” — JACK BARTON, CO-OWNER OF OUT OF THE GREY, ON HELP FROM MENTORS

K A R A M U R P H Y is a freelance writer who lives in Erie. Contact her at www. karawrites.com.

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 9M

The Cowboy Co-op This year marks Northwestern RECʼs 80th anniversary, so it seems fitting for the co-op to look back to its beginnings and reflect on the reasons for the creation of electric cooperatives. This is a remarkable story that demonstrates the exceptional nature of the Americans who populated rural America, then and now. Nineteen hundred and thirty five. Itʼs hard to imagine what life was like outside urban areas in those days, especially today – news taking days to reach you, dirt roads, manual labor and no electricity. Life for a large portion of the America was, pretty much, a frontier life. Rugged people making a living by strength, persistence and hard work. Relying on their neighbors when things got tough. While 95 percent of urban dwellers had electricity, only one in 10 rural Americans was so blessed. It was in this same year on May 11, when President Franklin Roosevelt signed the Rural Electrification Administration (REA) into law. Immediately “cowboy” cooperatives took the bit in their teeth and started popping up all across America, Northwestern REC getting its start on February 13, 1936 - the first in Pennsylvania. Tough, self-reliant, hardworking, honest, resilient men and women willing to take bold action to serve their interests and create a better life for their families, their neighbors and their communities. The term “cowboy” conjures up Hollywood images of hard fighting, hard drinking, rugged individuals fighting injustice against great odds. While the actual character of the cowboy cooperative didnʼt reflect the Hollywood image, the cooperative model matched the cowboy ethic perfectly. A book written by a retired Wall Street executive, James Owen, captured this ethic and boiled it down to the following 10 points . 1) Live each day with courage. 2) Take pride in your work. 3) Always finish what you start. 4) Do what has to be done. 5) Be tough, but fair. 6) When you make a promise, keep it. 7) Ride for the brand. 8) Talk less and say more. 9) Remember that some things arenʼt for sale. 10) Know where to draw the line. Seems just another way of laying out the cooperative principles that we run our businesses by to this very day. It appears that cowboys and cooperatives were a natural fit. So these cowboys got busy organizing electric cooperatives and began the work of bringing light to rural America. They dug holes by hand. They walked the poles up into place to carry the electric lines. All this had to be done with picks, shovels, ladders and whatever else was handy. Most of us have seen these poignant images of remote places with men scrambling to light the rural landscape. Wires had to be man handled into place on the poles and cross arms. Creating the proper tension and securing the conductors to the insulators was all done by man strength and by sight. Safety equipment was non-existent. Many of these cowboys gave their lives to bring the benefits of electricity to their homes and communities. Given all that has happened, some might think the cowboy cooperative is a thing of the past. But they would be wrong to think that. The cowboy cooperative is needed just as much today as it was in 1935. Changes are sweeping through the electric utility industry, and if the cooperatives are to retain the benefits that electrification has brought to rural America, bold, decisive action by a new breed of cooperative cowboy will be required. A new generation of members is coming onto cooperative lines. Members who saw electric co-ops as “saviors” by bringing in the simple benefits of light, refrigeration and other appliances are fading into memory. Community involvement is a staple of Northwestern REC. Today, we are actively involved in Kiwanis, local Chambers of Commerce, the Community Improvement Center, 4-H, FFA and so on, as a means of improving where we live and work beyond the simple provision of power. As these efforts continue, we recognize that community for many of our new members resides on the Internet - a collection of electronic representations of individuals rather than meeting in person. New members expect immediate response and limitless information. It is a challenge worthy of a cowboy response. Engaging our membership in the future will be challenging, but so was bringing electricity to rural America. While the tools differ, the cowboy cooperative mindset and ethic have not changed. Think about the points James Owen identified. They reflect values still consistent with the seven cooperative principles and underscore the relevance of the cowboy co-op in facing todayʼs challenges.

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The frontier life of today is different indeed. In the 21st century, co-ops will continue to work in their self-interests. This means employees and members alike pitching in and doing whatever they can individually and collectively to be sure that the interests of our community are well served and that electricity remains affordable and reliable. Just as it was in the 1930s, working in our self-interest wonʼt be selﬁsh, it will be for the beneﬁt of the families in our communities - and thatʼs who we, at Northwestern REC, are here to serve.

10M | Erie Times-News | GoErie.com | Sunday, February 14, 2016

SUNDAY

February 14, 2016

Annual economic report for the Erie region

ERIE 2016

SECTION

CHRISTOPHER MILLETTE/Erie Times-News

Terry Cavanaugh, who has been chief executive of Erie Insurance since 2008, plans to retire this year. On his watch, the company has grown, both in number of customers and financial stability, and has expanded its presence downtown. Behind him is a portrait of company co-founder H.O. Hirt.

Investing

IN ERIE As tenure draws to a close, Cavanaugh reflects on changes at Erie Insurance

IN THE WORKS: A look at some of the projects that are reshaping Erie. 3N

DOWNTOWN: Agency has plans to create vibrant future in the heart of the city. 4N

By JIM MARTIN jim.martin@timesnews.com At 6 feet 8 inches tall, Terry Cavanaugh, chief executive of Erie Insurance, tends to be the most readily noticed person in the room. To a growing degree, the same can be said of the company he’s led since 2008. In the past year alone, Erie Insurance — once regarded as “the quiet company,” Cavanaugh says — became one of the nation’s first insurance companies to deploy drones as part of the claims process and experimented with Google Glass to help assess claims. Erie’s second largest employer has won its share of awards, but one piece of recognition speaks to a cultural shift.

➤ Please see ERIE, 2N

ALSO INSIDE THIS SECTION:

• RETAIL: Shopping options shift. 6N • EDUCATION: College challenges. 8N • HEALTH: Few in private practice. 9N

2N | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ERIE 2016

The good news for us is that unlike some other insurance companies that are tapped out and in all 50 states — they are just kind of scratching their heads, wondering what to do — we have the opportunity to grow.” — Terry Cavanaugh, Of erIe InsuranCe

Erie: Growth years Continued from 1B

PasT, PresenT and fuTure

▀ age: 62 ▀ Position: Chief executive since 2008 of Erie Insurance. ▀ first job: “I was a newspaper boy on the south side of Chicago when I was 10 or 11,” he said. Later on, he worked construction, did yard work and made deliveries for a florist. ▀ short-term plans: Cavanaugh expects to retire by the end of the year. ▀ Long-term plans: Cavanaugh hopes to serve on the board of directors of one or two companies. He also envisions serving as a consultant, providing coaching services to other top executives. ▀ Personal: He and his wife, the former Patricia O’Brien, have four children and two grandchildren. ▀ Quotable: Speaking about volunteerism by company employees, he says, “There isn’t a thing of importance that happens in this county where there isn’t some Erie Insurance DNA helping to make it better.”

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aT TOP: The Erie Insurance Technical Learning Center includes a 3,000-square-foot model house for training. “It’s spectacular,” says Terry Cavanaugh, chief executive. aT BOTTOM: The restored Pennsylvania Armory now houses Erie Insurance offices.

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there is a half-life to being a CEO,” Cavanaugh said. “I don’t know what the number (of years) is. It’s different for different people. I have helped build a business here, and it is a good time for another face to come in and carry on with what we are doing well, but also do some things differently.” Cavanaugh uses the word “appropriate” to describe the length of his tenure with the only Fortune 500 company based in Erie. He said he doesn’t envy the challenges faced by chief executives at GE Transportation, who typically serve for about two years. “For a GE, it may work,” he said. “Maybe you are trying to build a portfolio of experience for someone, but after two years that person hasn’t had the opportunity to put their imprint on the local operating business.” Cavanaugh was clear about one thing when he arrived in Erie: This wasn’t a company in need of being turned around. Looking back, he said, “I was very fortunate to come into a company that had a great history of success and a great platform of doing great things for the customers. Hopefully I have been able to add to that.”

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sell on price, you lose on price.” Cavanaugh, who was the first outsider to lead Erie Insurance in the company’s 90 years, will likely leave both the company and the community with a sense of heightened expectations. On his watch, the company weathered a historic recession, boosted the number of policyholders, maintained strong financial numbers, won a shelffull of industry awards, invested millions in its neighborhood and bought the naming rights to what is now Erie Insurance Arena. “I think Terry has aggressively continued both the legacy of the HirtHagen families and the company’s commitment to the community and the region,” said Barbara Chaffee, president of the Erie Regional Chamber and Growth Partnership. Cavanaugh, who sits on the chamber’s board, “always asks the toughest questions and pays attention to every detail,” Chaffee said. “It’s very challenging for the CEO of a large company, or any company, to commit that kind of time and energy.” After a few months of working with the company’s new chief executive, who will likely be named this spring, Cavanaugh said he’s looking forward to serving on a couple of corporate boards. Why leave Erie Insurance at the end of the year? “I have always said

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Erie Insurance, where officials talked publicly about struggles to implement new technology before Cavanaugh’s arrival, was lauded in 2015 by Insurance Networking News as No. 1 on a list of the “Five Hottest Carriers in Insurance Technology.” “Being recognized for our work, whether it be by Moody’s or Forbes or J.D. Power, those are some of the things that are helping us attract and keep good people,” said Cavanaugh, who announced in 2015 that he plans to retire by the end of this year. Cavanaugh, 62, sees other investments in the company and the neighborhood paying dividends as well. The most substantial of those was the unveiling a year ago of the Erie Insurance Technical Learning Center, a 52,000-squarefoot facility on East Seventh Street. The building houses an auto body shop and classroom, and a 3,000-square-foot house, built as a training center for adjusters. “It’s spectacular,” Cavanaugh said. “It has allowed us to create a high level of continuity in our training.” The past year was one marked by both celebration and investment as the company marked its 90th anniversary and unveiled the restored Pennsylvania Armory, which now houses the company’s strategic marketing and customer experience teams. In 2015, the company also passed the threshold of having more than 5 million policies in force in a service area that includes 12 states and the District of Columbia. That’s big enough to rank Erie as the nation’s 12th-largest auto insurer and 10th-largest home insurer. But is it big enough to survive in an era of consolidation and insurance companies endorsed by celebrity lizards? “I think certainly we have the financial resources to compete with anybody,” Cavanaugh said. “We need to make sure we invest in our business, and we need to make sure 10 years from now we can say the same thing.” In a sense, he said, Erie’s status as a regional company is an advantage. “The good news for us is that unlike some other insurance companies that are tapped out and in all 50 states — they are just kind of scratching their heads, wondering what to do — we have the opportunity to grow.” Although Cavanaugh will be leaving, he doesn’t expect Erie Insurance will veer far from its mission as a service-oriented company that relies heavily on its network of agents. “I believe in every market, there is a certain customer who likes hightouch, personalized service,” he said. The challenge, he said, is marrying that approach with technology. Despite some cuttingedge moves — Erie Insurance was one of the first companies to write insurance for Uber drivers — Cavanaugh sees the company staying with the approach that made it successful. That might mean missing out on customers who shop strictly on price and the ability to do all of their business online. “We are forgoing a certain segment, but that is OK, he said. “When you become just a commodity, it’s not fun for the employee, and it’s dangerous for the agent, because if you

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ERIE 2016 Greengarden Place

Goals redeveloped

New life in old places

AGENCY: New focus boosts DevelopErie

Three major building projects this year in Erie County could help redefine the county’s retail landscape.

By KEVIN FLOWERS kevin.flowers@timesnews.com

ANDY COLWELL/Erie Times-News

Remaking a plaza

Frontier Park

Layout of new plaza

McCormick Structural Systems Inc. has built a new plaza at West Eighth Street and Greengarden Road across from Frontier Park. The plaza, shown above, includes two buildings, each about 11,500-square-feet, with retail and commercial space. There is also a parking lot with 90 spaces. Some interior work is still being done on the buildings. Tenants will be able to move in by spring.

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 3N

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After more than a year of turmoil, DevelopErie has refocused on its strengths. The region’s lead economic development agency has worked to improve its cash flow by selling off more than $2 million in property, including real estate in Erie, Fairview and Summit townships. Officials there are working to broker the sale of the former Lord Corp. facility on West 12th Street near Greengarden Road to a private developer, and helped Minnesota-based KLN buy a snack foods plant in Waterford and coordinate needed infra-

structure upgrades there. DevelopErie has also downsized, cutting its ranks from 17 employees to eight; continued expansion of its headquarters at Penn State Behrend’s Knowledge Park; redeveloped brownfield sites; and loaned money to businesses as it works to repair a public image damaged by failed initiatives like the Erie Inland Port plan and a proposed rail terminal in Harborcreek Township. The agency spent millions of dollars on those plans, which never materialized. “We have a niche in what we can provide,” said Katrina Vincent, chief executive of DevelopErie. “We have some unique capabilities. Bricks-andmortar economic development, these are the types

of projects we need to be engaged in.” Mark Denlinger, chairman of the Economic Development Corp. of Erie County, the management arm of DevelopErie, has said that the agency is on “solid ground” in the wake of former Chief Executive John Elliott’s tenure. Elliott resigned in October 2014. Denlinger said at that time that the failed rail project and other projects had left DevelopErie “overextended” in terms of debt. However, Vincent said that concentrating on “basic nuts and bolts” of economic development is serving the agency well.

K E V I N F L O W E R S can be reached at 870-1693 or by e-mail. Follow him on Twitter at twitter.com/ETNflowers.

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The 12.5-acre site of the former GAF Materials Corp. will be home to a market house, restaurants, offices, residential apartments and parking garages under an ambitious waterfront development plan. Erie Events, owner of the site, and Kidder Wachter Architecture & Design have created the concept, which will be developed in stages. A developer will be chosen at a later date. A public meeting will be held in Monday to show more details about the plan.

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Scott Enterprises plans to build a $10 million adventure park that would include a trampoline park, an obstacle course, zip lines, glow-inthe-dark miniature golf, climbing wall, multilevel laser tag arena and, an interactive game arcade. Construction on the adventure park, which will be located on Downs Drive, is expected to begin by spring.

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4N | Erie Times-News | GoErie.com | Sunday, February 14, 2016

HEART OF THE CITY: Revitalization agency plans for vibrant future

Downtown rises

By LISA THOMPSON lisa.thompson@timesnews.com

The Erie Downtown Partnership in its earliest days tackled one cold fact of business life in Erie: It acquired the means to clear its members’ snowfilled sidewalks. The nonprofit downtown revitalization agency grew to develop the popular summer block party series and the Downtown d’Lights holiday celebration and other events that have drawn thousands to the downtown. It has created advertising and supported facade improvements for its members. As it enters its 12th year in 2016, the partnership is setting its sights on longerrange plans meant to aid its members’ and the region’s economic growth. “There has been some growth in terms of its role,” said Executive Director John Buchna. Buchna said the partnership — in conjunction with other regional planning efforts, including Emerge 2040 and Erie’s downtown master plan — aims to create a safe, thriving, convenient downtown region that ties in seamlessly with ambitious developments taking shape along the waterfront, including recently unveiled plans for housing, retail, offices and green space along Erie’s west bayfront that was once home to the GAF Materials Corp. “A lot of people have

JACK HANRAHAN/Erie Times-News

Visitors arrive at the Warner Theatre for the MLK Weekend Comedy Show in January. The historic theater, 811 State St., is a cultural draw downtown and is on the path of a Cultural Loop trolley service offered Saturday evenings and sponsored by the Erie Downtown Partnership and other agencies.

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 5N

A lot of people have expressed great interest via investment in keeping the downtown, making it more vibrant, and that downtown includes the bayfront.” — JOHN BUCHNA, EXECUTIVE DIRECTOR OF ERIE DOWNTOWN PARTNERSHIP Continued from 4N expressed great interest via investment in keeping the downtown, making it more vibrant, and that downtown includes the bayfront,” Buchna said. “All of the proposed development that is happening there and how it relates to the downtown is good because it is investment,” he said. The task now — through transportation and event planning — is to ensure that “we remain physically connected,” he said.

A good year The partnership serves businesses throughout a 70-block area of downtown Erie from Sassafras to Holland streets, between the bayfront and 14th Street. Property owners within the district support the organization with an assessment based on property value and $10 membership fees. In 2015, the partnership continued a 10-year tradition, hosting 10 downtown summer block parties that offered visitors food, drink and dancing and earned charities $58,576, eclipsing the then-record amount of $50,691 raised in 2014. The annual Downtown d’Lights holiday program in Perry Square, also in its 10th year, featured more than 750,000 lights in West Perry Square and part of East Perry Square, which is still undergoing renovation. The celebration marked the first official event at the new multiuse pavilion along State Street. The partnership offered its members a security camera grant program that provided up to $2,000 per applicant to help cover

FILE PHOTO GREG WOHLFORD/Erie Times-News

Crowds pack the 300 block of State Street in June for the first Erie Downtown Partnership block party of the season. The Thursday night block parties, which began in 2005, quickly became a summer tradition, bringing visitors downtown for food, drink and live music. the costs of exterior cameras to deter unwanted behavior. Six grants were awarded, Buchna said. In 2015, the partnership also created a new television advertising campaign that promoted the downtown as a destination and specific businesses, restaurants, and entertainment and sports events as attractions. “Small independent business owners don’t have as deep pockets as a chain or box store,” Buchna said. The ad campaign helped them “stretch their dollars so the community understands they are here,” he said. A new Cultural Loop trolley service introduced in 2015 as part of a pilot

program by Erie Arts & Culture, the Downtown Partnership and the Erie Metropolitan Transit Authority now shuttles visitors from the Erie Intermodal Center to downtown cultural events and restaurants. “We now want to look at how to better support local sports fans,” he said.

Coming attractions The Downtown Partnership plans to unveil its new master plan in March. Buchna declined to comment in detail but said it will recommend the designation of four themed districts within the downtown. The Downtown Partner-

ship will continue in 2016 to work with EMTA to develop an innovative food hub in a new parking facility at East 14th and French streets. Buchna said plans call for the ground floor of the new garage to have a market area meant to provide fresh, healthy foods year-round to residents in that area, which lacks the presence of a large grocery outlet. EMTA plans to coordinate public transportation routes from so-called “food desert” areas of the city to the market, he said. He expects the market will draw tourists and coordinate well with Erie businessman Rick Griffith’s plans to build 14 to 16 market-rate apart-

ments at nearby Union Square this year. The partnership plans to continue to raise the profiles of its members through new websites and a “Hello Downtown!” mobile app tied into VisitErie’s “Hello Erie!” app. “They have 11,000 subscribers. We are the first to be joining forces with them,” he said. The mobile app will help orient visitors to downtown attractions with a few taps on a phone, he said. Parking will also be a focus. The partnership hopes to join with the Parking Authority in a pilot program experimenting with technology that may, for

example, allow a visitor to pay for parking with a debit card rather than coins. “That is huge for downtown. You don’t have to worry about feeding the meter,” he said. Each project, be it a new awning boosting a local business facade or a comprehensive transportation plan, Buchna said, will fit with the overall goal of “maintaining and growing the community.” “We are on the cusp of some great things. We just have to accept change to get there,” he said.

L I S A T H O M P S O N can be reached at 870-1802 or by e-mail. Follow her on Twitter at twitter.com/ ETNthompson.

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6N | Erie Times-News | GoErie.com | Sunday, February 14, 2016

ERIE 2016

Changes in store?

RETAIL: Shopping

options shift amid online competition By KARA MURPHY Contributing Writer Erie County’s stores are not immune to the changing face of retail in this age of online shopping. But there is evidence that many of those stores remain relatively healthy — especially when it comes to employment numbers. Erie County added 900 retail jobs in 2015 at a time when the entire state added 800. Without Erie County’s numbers, the state would have recorded a loss in retail jobs for the year. Joe Bell, spokesman for the Youngstown, Ohio-based Cafaro Co., which owns the Millcreek Mall, points to that number when talking about the vibrancy of Peach Street retail. “We don’t talk a lot about sales figures — a lot of it is proprietary, andwe’reprohibitedfromdiscussing details — but I can say Millcreek Mall has always been a very strong mall in terms of sales,” Bell said. “It does very well in comparison with other shopping malls.” Bell said the main reason for Peach Street’s resilience is its location and Pennsylvania’s lack of a sales tax on clothing. That attracts shoppers from areas like Ohio, New York and Ontario, as is evident by the variety of license plates in parking lots in the sprawling Peach Street retail corridor. That means even when local shoppers might be more reluctant to spend money when bad economic news comes — such as layoffs at GE Transportation — there are still shoppers who are “going to open pocketbooks,” Bell said.

FILE PHOTO GREG WOHLFORD/Erie Times-News

The Peach Street retail area, including the Millcreek Mall, draws customers from several states and Canada. Peach Street are far from immune to the shift to online shopping. Sears, Macy’s, Target and JCPenney, for instance, are in the process of closing or have closed hundreds of underperforming stores across the nation since 2014. The latest holiday season didn’t show mercy: Holiday shopping sales increased just 3.1 percent, below the 3.7 percent forecast by the National Retail Federation. Online retail shopping, in contrast, saw a 9 percent increase over the holiday season, according to the NRF. The few local retailers on upper Peach Street are feeling the pinch and working to evolve their businesses to account for the changing marketplace. Erie Sport Store, for instance, has expanded its repair department and amped up its team sales department — which includes things like personalized embroidered uniforms and trophies — while putting less emphasis on retail sales. “We see retail as flat now and into the future,” said Rich Weber, owner of Erie Sport Store. “I think you have to be realistic about that and understand things are changing.”

‘You have to be realistic’ Despite the built-in benefits in the Erie market, the many national chain stores that anchor upper

Christine Dahlkemper, co-owner of Dahlkemper’s Jewelry Connection said her store, while it has a website, hasn’t done online business. But her children — the third generation to be involved with the store — might change that. “We’re not comfortable with that,” she said. “But my children are very savvy, and they’re thinking that needs to be an option in the future. We’ll see.”

‘The best will adapt’ There’s no doubt the number of online shoppers is growing by leaps and bounds. For example, Cyber Monday in 2015 saw a 21 percent jump in shopping as compared with 2014, according to ComScore, a global media measurement and analytics company. The retailers that will be able to survive the shift to online shopping will be the ones that can best adapt to shoppers’ changing expectations, Bell said. “They’re learning that customer service includes embracing an online presence — even on the sales floor,” he said. Offering free Wi-Fi; equipping staff with tablets to answer questions, compare prices and place orders on shoppers’ behalf; and

embracing social media are examples of how retailers are experimenting in how to adapt. But how will online shopping change the way the mall looks 10, 15, even 20 years in the future? “Developers have been adapting to introduce more amenities,” Bell said. “Shopping malls are changing from more than just simple retail merchandise outlets into more experiential type of shopping — it’s not a place just to purchase clothing, but it’s a place you want to be, where you want to spend time.” That means offering more entertainment options, ranging from restaurants to playgrounds, and including a mix of “practical” businesses — like dental and tax offices, for instance, Bell said. “For years people have been predicting the death of brick-andmortar shopping centers. But you can’t have lunch with a friend online. You can’t taste and touch and feel sitting in front of a computer screen,” he said. “I don’t see online shopping as being thedeathof brick and mortar. It’s changing it, for sure. But the best will adapt.”

Shopping malls are changing from more than just simple retail merchandise outlets into more experiential type of shopping — it’s not a place just to purchase clothing, but it’s a place you want to be, where you want to spend time.” — JOE BELL, CAFARO CO. SPOKESMAN

K A R A M U R P H Y is a freelance writer in Erie. Contact her at www. karawrites.com.

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Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 7N

FAITH COMMUNITIES: Churches find new homes in unconventional sites

Places of worship

By DANA MASSING dana.massing@timesnews.com

When Family Church officials began looking to plant a church in Erie, they were open to any location — storefronts, industrial complexes, homes. “There was nothing that was out-of-bounds for us,” the Rev. Timothy Stahlman said. He’s pastor of Family Church Jamestown, part of an organization of nondenominational churches that was founded in Fredonia, N.Y., and has expanded to include North East and Warren, Pa. He figured they’d begin Family Church Erie by renting 2,400 square feet of commercial space, similar to how some of the nine other Family Church sites started. But after looking at dozens of properties and even bidding unsuccessfully on a couple, the new church still didn’t have a place. “It really started feeling like it was getting discouraging,” Stahlman said. Then the church heard about the Amish Buggy building — nearly 23,000 square feet of space for sale by owners closing their store along the Erie area’s busiest shopping thoroughfare. Family Church Erie bought the Peach Street site and became the latest area religious congregation to turn a former place of business into a place of worship. McLane Church moved into a former Ames department store near Edinboro more than a dozen years ago. More recently, Elevate Church relocated from rented space in an Erie school and began holding services Dec. 6 in the old six-screen movie theater building outside the Millcreek Mall. “It’s phenomenal,” Pastor Col-

JACK HANRAHAN/Erie Times-News

FILE PHOTO ANDY COLWELL/Erie Times-News

AT LEFT: Family Church Erie, part of a nondenominational organization of churches, purchased the Amish Buggy store on the busy Peach Street shopping corridor. The church is initially using the first floor for services while Amish Buggy inventory is liquidated from the second floor. AT RIGHT: The former Cinemark Millcreek 6 movie theater was converted in 2015 into worship space for Elevate Church. Elevate Church is renting the former theater and renovated it into a permanent home — one that adds space and visibility to the church, Pastor Colby Atkins says. by Atkins said about Elevate’s new location. “The facility is great, parking is great.” His nondenominational congregation renovated and is renting the old Cinemark Millcreek 6, which closed in 2012. Four services are held there on Sundays, drawing a total of about 1,300 worshippers, up a few hundred since before the move, Atkins said. He said being in a high-traffic area does provide more visibility to the church. A few people have checked it out after shopping at the mall, he said. Mall merchants also benefit from people who follow worship with a stop at a restaurant or store. “They have to go eat some-

place, shop someplace,” Atkins said. He aims to attract people who aren’t connected to a church, those he calls “the spiritually restless.” He said 60 percent of Elevate’s members hadn’t been to church in 10 years or 20 years or ever. Many had a negative perception of traditional church. Meeting in a building that looks more like a movie house than a house of worship can make them feel more welcome, Atkins said. Like Family Church Erie, Elevate was open to moving anywhere. But Atkins said the commercial location had advantages over an empty traditional church building. “Most of the old churches that

are out there, ... they don’t have adequate parking,” he said. Family Church Erie’s site in Millcreek also comes with parking and what Stahlman called a “dynamic location as far as visibility goes” for the Bible-teaching congregation. Volunteers from Family Church Jamestown are helping with minor renovations to the Amish Buggy building, Stahlman said. Each Family Church is independent, but they are closeknit sister churches, he said. Stahlman will start out leading the Erie church, which will initially use the building’s first floor while the business liquidates its inventory from the second floor. The store is scheduled to be out by the end of 2016, although

that’s more likely to happen in July or August, he said. “We are very excited to be in the building that we are in,” Stahlman said. He said some people have mentioned that switching the site from a furniture store to a church will mean a loss in local tax revenue. But he said he’s seen marriages restored and families kept together through Family Church Jamestown. “We believe in the long run the services we offer do make up for that (tax) loss,” Stahlman said.

D A N A M A S S I N G can be reached at 870-1729 or by e-mail. Follow her on Twitter at twitter. com/ETNmassing.

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8N | Erie Times-News | GoErie.com | Sunday, February 14, 2016

HIGHER EDUCATION: Region’s new college leaders face big challenges

Learning curves

RECENT

Changing demographics. Heightened expectations from students and parents. Competition and new models of learning. Those are among the challenges college and university presidents — including new leaders at Penn State Behrend, Mercyhurst University and, in the near future, Edinboro University of Pennsylvania — will face in the coming months and years as they navigate the changing landscape of higher education. One critical issue: access. “The students we are seeing move into colleges and universities across the country constitute a different demographic than they have,” said Lynn Gangone, vice president of Leadership Programs for the American Council on Education. “Oftentimes they are coming from families that are not as capable of affording a college or university experience, often coming from school systems where they might not have been as well prepared academically.” There are more nontraditional students entering higher education than traditional students. Colleges and universities are working to better serve adult learners and part-time students, Gangone said. Nontraditional students “are going to require different approaches, both from a teaching and a learning and a financial support perspective” than traditional students, said Rick Staisloff, founder and principal of RPK Group, an education consulting firm based in Annapolis, Md. “We want to expand the number of students who are achieving some completion.”

At Penn state Behrend: Ralph

mOvEs

By ERICA ERWIN erica.erwin@timesnews.com

Ford, a longtime administrator, was named chancellor, succeeding Donald Birx.

At mercyhurst University:

FILE PHOTO ANDY COLWELL/Erie Times-News

Sha Neopaney, 30, left, works with physics lab partners Naina Monger, 20, center, and Puspa Upreti, 19, all of Erie, during class at Edinboro University of Pennsylvania’s Porreco College in November. New college leaders in the region, including at Edinboro, will be grappling with changes in higher education, including an increase in nontraditional and part-time students, a focus on post-degree employment, and new models of learning. Parents and students are demanding, now more than ever as tuition and other costs continue to rise, that they see some return on their investment after graduation. “The expectationhasvery much changed in that colleges now need to own what happens after graduation,” Staisloff said. “Previously their job was to hand out diplomas, walk across the stage and say, ‘Good luck.’ Now we need to think about the outcomes of the very big investment the student has made in themselves.

“We need to be looking at are students working six months after graduation and, more importantly, are they working in their field of study and what are their median salaries?” Staisloff said. “How is the college experience connected to students’ ability to launch out into the world?” Finally, college presidents will have to lead the charge when it comes to responding to competition and adapting to new methods of teaching. “They’re looking at how do they manageonlineandblendedlearn-

ing and what is the infrastructure to support that,” Gangone said. “And they look at competition, not just from other colleges and universities but from corporations that have their own colleges and universities.” Looks like one big homework assignment.

E R I C A E R W I N can be reached at 870-1846 or by e-mail. Follow her on Twitter at twitter.com/ ETNerwin. Read the Happier Ed education blog at blogs.goerie.com/ education and post comments.

ONLINE: Read more about colleges and universities in the Erie region. GoErie.com/education

Michael Victor, formerly of Lake Erie College, was named president, succeeding Tom Gamble.

At Edinboro University: David J. Werner, of Southern Illinois University Edwardsville, is the interim president during the search for a successor to Julie Wollman.

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ERIE 2016

Sunday, February 14, 2016 | Erie Times-News | GoErie.com | 9N

Private practices rare HealtH care: The

few independent physicians left face higher costs, more paperwork By DAVID BRUCE david.bruce@timesnews.com

Frank Pregler, D.O., is proud of his medical office’s history. The family physician is only the third doctor to treat patients at 3710 Pine Ave. since the office was built in 1949. All three have been in private practice, which wasn’t unusual 67 years ago but is now unique. “There are only a handful of us in Erie now,” Pregler said, referring to the number of physician-owned medical offices. “When I started in 1991, I shared call with seven or eight other primary care doctors. Now there are two of us.” Erie County’s number of doctors still in private practice has declined significantly in recent years. Exact numbers were not available, but the Erie County ANDY COLWELL/Erie Times-News Medical Society recently reported only five of its members Frank Pregler, D.O., says he is comfortable maintaining his own medical practice, at 3710 Pine Ave., even were primary care physicians in though he could make more money by joining a larger system. Pragler, of Millcreek Township, says one of private practice. the reasons he has stayed independent is that it allows him to remain true to his religious beliefs. Most of them have either retired or now work for a large Medical Society. “We don’t have though he said he would bring also important. I’m a deacon in health-care organizations such specific data, but our best guess home more money being an em- the Catholic church, and I don’t as UPMC, Allegheny Health Net- is that between 60 and 70 percent ployed physician. prescribe artificial birth control. One reason is that Pregler is I’m leery that if I joined a health work, LECOM Health or the Erie of physicians in Pennsylvania comfortable running the prac- system, it would compromise my Veterans Affairs Medical Center. are now employed.” “There is definitely a trend Pregler said he has been ap- tice with help from his wife, beliefs.” Staying independent isn’t statewide and nationally, too,” proached several times to sell Jane, who serves as the office said Dennis Olmstead, senior his practice and join one of the manager. easy, Pregler said. He pays his “I like being able to control my own malpractice insurance, the adviser of health economics large systems. He has declined and policy for the Pennsylvania for a couple of reasons, even hours,” Pregler said. “My faith is costs of his office’s electronic

57%

Percentage of independent U.S. physicians practicing in 2000, according to global consulting firm accenture.

37%

Percentage of independent U.S. physicians in 2013, according to accenture. In 2005, it was 49 percent.

medical records system and even upkeep on the office building, which he owns. He employs seven full-time workers, up from four when he started in 1991. “The amount of paperwork we have to do in the office is ridiculous,” Pregler said. “Even with the additional employees, I’m doing more paperwork. I see patients about 35 hours a week, but I’m doing paperwork another 15 to 20 hours a week.” Pregler isn’t the only independent physician dealing with extra administrative duties. Scott Lim, D.O., is a Millcreek Township dermatologist in private practice. His office switched to electronic medical records in 2014, in part because recent billing code changes made it almost impossible to keep his old system. “It was tough at first, dealing with both electronic medical records and the new codes,” Lim said. “We had to stop taking new patients for a while as we learned the system. ... We couldn’t see the same number of patients a day, and we lost money. It took some time before we were seeing the same number of patients as before.” The benefits of staying independent far outweigh the disadvantages, Lim and Pregler said. “I can develop a personal relationship with my patients,” Pregler said. “I can practice the way I want to practice and not worry whether I’m meeting any of the health system’s benchmarks.”

D A V I D B R U C E can be reached at 870-1736 or by e-mail. Follow him on Twitter at twitter.com/ ETNbruce.

33%

Percentage of U.S. physicians who will be in independent practice at the end of this year, according to accenture.

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