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Forced Elevator Upgrades Could Crush Local Businesses

Tuesday, September 18, 2012

 

Local businesses have less than a year to meet new state elevator standards, but the improvements carry such high costs that some merchants may be considering walking away.

The issue stems from regulations introduced by the Massachusetts Department of Public Safety in 2008, which required that lifts using wood-based elevator shafts be upgraded to new, safer alternatives.

In some cases, those upgrades can carry a price tag of $100,000.

Mostly found in older buildings and used for freight elevators with human passengers, the wood-based shafts pose a safety risk because of the difficulty of detecting potentially hazardous levels of wear on the framework, such as stress fractures in the wood beams.

The state issued waivers grandfathering in a number of such elevators in order to give business owners time to business owners time to update the equipment.

However, the current round of waivers are set to expire in July of 2013.

The High Cost of a Short Lift

According to Stuart Loosemore, Director of Government Affairs and Public Policy for the Worcester Regional Chamber of Commerce, some businesses are prohibited from using the lifts but are exempted from having to update under the grandfather clause.

Others, he said, have been able to convert their elevators to non-passenger lifts, which are not permitted to carry workers, only good and materials, and can be controlled externally.

Still others are biding their time and weighing their options.

"I think this is kind of in a holding pattern, waiting to see what some of the businesses are going to do," Loosemore said.

"At this point, we're working with them, we're trying to work with the state to see if we can figure something out."

Any forthcoming solution will likely be legislative, as lawmakers and safety officials try to balance the twin responsibilities of ensuring the safety of the Commonwealth's employees and helping businesses stay afloat under the mounting costs of regulatory compliance.

"If it's going to cost more than your building's worth to fix the problem, some of them might be looking at the idea of walking away," Loosemore said.

Earlier this year, the long-time Worcester business Arrow Wholesale Inc. closed down its Water Street facilities due to the looming elevator upgrade and various issues with code compliance at its aged building.

A representative for Arrow declined to comment for this story.

Solutions from the State House

Efforts to find a legislative fix for the elevator conundrum have been in the works since the new regulations were first introduced.

However, Loosemore said the start of the next legislative session in January is the earliest any such legislation is likely to be taken up.

State Senators Mike Moore (D-Millbury) and Harriette Chandler (D-Worcester) have played a leading role in the search for a solution before the current round of waivers expire in July of 2013.

That search is still on-going, and legislators are currently in the idea-gathering phase. In light of the high cost of the required upgrades and the sluggish economy, some of the options on the table include offering businesses zero-interest loans or delayed funding so that workplace safety can be ensured even if the cash to finance it is hard to come buy.

"It's a work in progress, and it's bringing all the stakeholders together," said Keith Mitchell, a spokesman from Senator Moore's office.

"We have to find a way to achieve compliance at the least cost to these businesses," he said.

"At the end of the day it's a safety issue."

 

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Comments:

Stephen Quist

A local business with over a 100 year history here in Worcester just closed because of this change in law. Arrow Wholesalers just closed their doors because the could nopt afford the new required updrades - the cost of the upgrades dwarfed the property value of the building itself.

Mark Markarian

There's nothing like government when it comes to jousting at windmills.

Stephen Jacoby

This is EXACTLY what government is supposed to do. If this is ignored, someone (many many) will die. It's the equivalent of waiting until a kid gets run over before spending the money to put in sidewalks. We're supposed to allow that? It's simply another cost of doing business. Companies will either spend the money, move their operation, or do without an elevator. It's not like they haven't had notice that it was coming! I feel badly for them, but it's simply the only smart thing to do.

Edward Saucier

I had occasion to use some of those old wooden freight elevators down on Commercial St. back in the 60s and they were shaky then. Some were even shut down for minor repairs two or three times a week. Seems like they never got around to really fixing them? I'm surprised someone finally got around to checking those things. I'm not surprised that the companies didn't have them checked and fixed if necessary on a regular basis. Too many companies like to roll the dice on paying a lot for repairs or paying a lot more for a death suit.

Mark Markarian

Hi Stephen Jacoby,

Below is the reason the new code was passed.

THE (SUSPICIOUS) DEATH OF A SMALL BUSINESS: ARROW WHOLESALE CO., 85, OF WORCESTER, MA

This is the true story regarding the demise of the small family business founded by my grandfather and carried on through 3 generations of the Ginsburg family of Worcester, MA. It’s a needless demise, and needless to say, I am taking it VERY personally. While there is no chance of a resurrection, I hope to raise awareness and share our story so that the city officials and private developers who, in my opinion, colluded to force Arrow to close its doors forever are someday held responsible. If nothing else, let this serve as a reminder that karma is a bitch. ~Gins

Arrow Wholesale Inc. is a distributor of old-fashioned 5&10; store merchandise and specializes in hard to find items. Toys, Housewares, Stationery, Novelties, seasonal goods are all part of the mix. Customers range from remaining Ben Franklin 5 & 10 Stores to independent housewares stores to beachside stores from Cape Cod to northern Maine.

Arrow was started in the early 1930′s by my grandfather, Samuel Ginsburg. Sam started out with a pushcart filled with sewing notions during the Depression, and eventually bought the building at 28 Water St. in Worcester. At the time, 28 Water housed Hamblin Manufacturing, a wire-press company common in this old industrial city at the time. Sam ran both businesses, and my father Elliott began working with him while in grade school. A Babson College dropout, Elliott has been the chief salesman and proprietor since he was 21 years old. He is now nearly 71. This business is all he knows. Like his father before him, Elliott planned to work until the day he died (Sam died at 91, on a Monday night after another typical day in the office), for Arrow Wholesale has been his chief abiding passion throughout his life.

My brother & I began working at Arrow as kids, stocking shelves and filling orders after school and joining our father on the road making deliveries and seeing customers as often as possible. Jamie joined the business full-time immediately after graduating Doherty Memorial High School in Worcester in 1985 and, like most family/small business endeavors, has done every job imaginable, from filling orders and handling all shipping to business development, product sourcing, and sales. I worked there after school and on vacation during high school and college, and full time from age 22 to 28. Did most of those same jobs too.

Over the years, the fire department has been an occasional visitor. Most of their reports simply indicated a need to clear alternate exits–otherwise, no headaches. The old-fashioned elevator in the building was the recipient of a grandfather clause, valid thru 2013. After that, they were going to be forced to replace the elevator, at a cost of $100,000. So what changed?

Last year, Winn Companies renovated the adjacent property at 48 Water St. Formerly Chevalier Furniture, the building was the recipient of a gut renovation, funded primarily by generous tax breaks from the state and federal government. Now known as Canal Lofts, the HUD-affiliated property serves as an affordable housing location. Canal Lofts is separated from Arrow Wholesale by an alley, about 4 feet in width.

Since the property opened, the city of Worcester has come after Elliott and Jamie hard. Citing “a complaint from the development next door,” city inspectors began fining the business and insisting on bringing all aspects of the building up to today’s code standards. While not an easy task, Jamie & Elliott have done everything in their power to comply. Clearing out merchandise to go beyond the new minimum requirements for spacing and sprinkler head reach; removing all flammable chemical products (cleaning supplies, etc.), removing buried oil tanks, and hiring a night watchman to be in the building from 7pm-7am…all of this was accomplished under very tight deadlines established in court. The most recent ruling gave them just 7 days to meet new standards. That 7-day period ended Tuesday, April 24; sure enough, city inspectors–including the city solicitor–arrived at Arrow that morning to inspect the progress. Despite Jamie’s Herculean effort that led to reaching 85% of the standards within those 7 days, there was no mention whatsoever of any progress made. Instead, more stern comments and complaints. On Wednesday mornng, April 25 2012, in their return to court to update the judge on their progress, the judge gave Arrow until May 31, 2012 to vacate the premises & lock the doors.

This is a VERY small operation–4 employees and now a bunch of temporary help as they worked furiously to comply with the city. Complicating matters is that Arrow has been unable to conduct much business for the past several months, as a direct result of the city’s demands. Several months ago, the city assessed a late tax penalty to Arrow due to a billboard anchored on their property. Why the late penalty? Because THE CITY never assessed it with the property prior to this year; despite this being the city’s mistake, they demanded–and received–full payment. Not being able to do any business, my father paid this bill out of his own pocket.

Unfortunately, moving to a new location is not realistic. The costs of moving, buying/leasing a new facility, and ensuring that any new space meets the city’s hyper-stringent requirements is prohibitive. The family’s only option is to liquidate inventory as quickly as possible. On May 31, the doors will be closed on an 85-year family business that has provided hundreds of jobs over the years, paid taxes, and generally acted as a good corporate citizen.

My strong suspicion — and this is strictly my personal belief — is that Winn Development led this effort in a collusive arrangement with city officials. Logically, it makes sense: the neighboring building is an eyesore in comparison, so force the business out and Winn can buy the land and building at a discount. Why the furious push? When the tax credits expire, Winn will want to convert their property to market-rate units. If the neighboring property is still aesthetically displeasing, getting whatever the market rate prices are in 2021 will be challenging. But if you’re able to get the land, knock the building down and start fresh, it’s a whole different story.

There has been no direct contact between Winn and Arrow’s lawyer. I find this inexplicable. Surely a deal amenable to both parties could have been worked out. Instead, an era ends and 4 more Worcester residents are out of work. Jamie and Elliott’s life’s work is over; at 45 and 70, respectively, they are suddenly forced to leave the only business they’ve ever known.

The end of an era is wistful, sad. The forced end of an era is just shameful.

Thanks for letting me hop up on my soap box.

Gins

Stephen Quist

Gins thank you for the family history of Arrow Wholesalers. I am sorry that the city of worcester administration sold their souls for and OUR sense of community to an outta town developer with a very questionable track record.
Unfortunately people like S.J. believe its the citys right to run roughshod over a 100yr old business rather than work cooperatively with all parties involved to seek resolution to these issues and keep this business open..........
Shame on the City Manager and his administration that sold out a Worcester icon for short term gain........disgusting!




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