March 01, 2007

Employers hail workers’ comp reform

Area businesses cite cost strain of insurance that can top $100,000 for some


Bob Ellis/staff photographer       
Alton McKane cuts a 1-by-6-inch board with a table saw at JTS Lumber on south Main Street in Cortland Wednesday afternoon. Small businesses would save 10 percent to 15 percent in annual workers’ compensation costs under a reform proposal by the state.

Staff Reporter

Tom Brown pays about $35,000 to $40,000 a year in workers’ compensation insurance for his eight employees.
He would pay $3,500 to $6,000 less a year under a proposal by Gov. Eliot Spitzer and state legislators to reform the system.
Brown, who owns Gallagher Construction, at 15 Commando Ave. in Cortland, is among a handful of business owners and leaders interviewed who support Spitzer’s measures to bring down insurance premiums by 10 percent to 15 percent, saving employers $1 billion a year, and increase minimum and maximum payments to injured workers.
James Gallagher, vice president of human relations at Cortland-based Marietta Corp., which has about 600 employees in Cortland, said that is good news. New York businesses pay much higher premiums than other states, he said.
“It would put us on a more level playing field with our neighbors,” he said.
The average workers’ compensation insurance premiums are 15 percent above the national average, according to the New York Workers’ Compensation Action Network, a group that lobbies for workers’ comp reform.
Gallagher said the proposal would also benefit workers’ compensation recipients. The reform proposal would increase the maximum weekly benefit from $400 to $600 over a three-year period and increase the minimum weekly benefit from $40 to $100.
David Compagni, who is a co-owner of Grant Street Construction in Cortland, said the decrease in premiums would not only help businesses and help workers, but it would also help taxpayers. He said his business does projects for municipalities, so if workers’ comp costs are lower, its bids will be lower.
“I know ahead of time what general liability I have when I bid a job,” he said.
Compagni said he pays between $400,000 and $500,000 a year on workers’ compensation for his approximately 100 employees.
Mary Lisa Strassheim, who co-owns Apex Painting in Dryden with Craig McCarthy, said she supports Spitzer’s proposal to enact anti-fraud measures, such as forcing more employers to pay into the system.
Workers’ compensation insurance is required by law.
She suspects some of her competitors don’t purchase workers’ compensation, and that puts her at a disadvantage, she said.
“Because we have workers’ comp, we have to charge more … instead of Joe the painter who doesn’t carry insurance,” she said.
Apex Painting has six employees, Strassheim said.
Spitzer is also saying the state would prosecute fraudulent worker claims under the new deal. That is one of the most crucial things the state needs to do, said Kenneth DeMunn, owner of JTS Lumber in Cortland.
“There’s a lot of this  going on which is fraudulent,” he said. “I know a fireman in Binghamton who has been getting compensation his whole life. He goes out and walks around.”
DeMunn wouldn’t reveal how many employees work at his company. He said he pays about 15 percent of employee payroll costs on workers’ compensation insurance.
The proposed anti-fraud measures are expected to save $100 million a year.
Dan Gustafson, owner of Mike’s Custom Welding on Route 11 in Homer, is disappointed Spitzer did not address the question of employer responsibility for employees under the influence of drugs.
He said New York is the only state where employers are liable for injuries by workers who are under the influence of drugs.
Lawsuits resulting from those accidents drive up the cost of insurance premiums or keep insurers from offering insurance for certain types of businesses, he said.
“It’s almost impossible for a new roofer to get started,” he said. “Because a roofer’s a dangerous occupation; it’s virtually impossibly to get coverage. I don’t know of any company willing to do roofers, and just a few are willing to do welders.”
Gustafson said he pays about $8,500 a year in worker’s compensation costs for the company’s seven employees. That number is relatively low because he is part of a cooperative of welding businesses that join together to get reduced workers’ compensation insurance rates.
Other concerns addressed by business owners interviewed over Spitzer’s proposals include how the state will have the manpower to detect fraud and what people who are truly injured will do when their workers’ compensation benefits stop.
Spitzer has proposed a cap on the number of years a permanently partially disabled person can receive workers’ compensation benefits, which he said could save employers almost $500 million  each year.



Developer scales back Homer housing project

Staff Reporter

HOMER — A developer has no longer committed to building 64 homes along Kinney Gulf Road near Route 90, saying instead he will build up to eight single-family homes on the east side of the road and maybe something eventually on the west side.
Partis Development plans to build one home at a time on about 40 acres of property the company intends to purchase, said Matt Neuman, a lawyer, speaking for developer Andy Partis.
The property is owned by the estate of Ira Killian, Town Attorney Patrick Snyder said this morning.
Partis would start by building two or three spec houses to see if there is a market for the houses, Neuman said.
“If things go well, we will progress,” Neuman said at a town Planning Board meeting Wednesday.
After the meeting Partis would not say how much the houses would be worth, preferring not to comment.
Partis also plans to buy about 116 acres of land on the west side Kinney Gulf Road, though he does not know at this point what he will do with the land.
That land is also under the name of the estate of Ira Killian, Snyder said.
Neuman said Partis may choose to parcel it off into small farms, build cluster housing developments or get an agricultural grant to keep it vacant.
The estate owns 156 acres along Kinney Gulf Road with an assessed value of $112,012, according to the Cortland County Office of Real Property Tax Services.
The board voted unanimously Wednesday to declare the subdivision of property on the east side into nine lots an unlisted action, meaning the subdivision will not have a significant adverse environmental impact.
Eight of the lots, which vary from 3.3 acres to 5.8 acres, will potentially have houses built on them, while the ninth lot, the northernmost lot, won’t for aesthetic and accessibility reasons, Partis said at the meeting.
The board also voted unanimously to be lead agency in the subdivision approval process, which must be approved by the county Health Department, the county Highway Department and possibly the Department of Environmental Conservation, Snyder said this morning.
Eventually, a public hearing will be held on the proposed subdivision.
John Kearns, who owns the land just to the north of the proposed subdivision, said he and some of his neighbors attended the meeting Wednesday to learn more about Partis’ plans and how they will be affected.
“These people moved here for the peace and quiet,” he said of his neighbors.
Kearns said Partis may not be building 64 houses, at least at this point, but even just building a few will disturb the area’s calm.
He said he can just imagine trucks going between the Partis family’s construction yard, which is called A P Builders Inc. and located at 4915 Kinney Gulf Road, and the lots on the east side of the road.


County hopes that attracting bicyclists helps boost tourism

Staff Reporter

Jim Dempsey is hoping that a new marketing strategy, which includes editorial ads and a brochure entitled “Biking Cortland County,” will attract cyclists to the county.
“We would target people that like to cycle,” said Dempsey, director of the Cortland County Convention and Visitors Bureau.
The brochure cost approximately $2,000 to print 5,000 copies, which Dempsey said would be distributed to cycling clubs across the state. Graphics Plus printing in Cortland produced the brochures.
Dempsey said the funds to create the brochures came from the Cortland County Convention and Visitors Bureau’s $150,000 annual budget.
The promotional effort will extend nationwide, Dempsey said, with ads that will be placed in cycling publications like Bike Midwest and Spokes. Dempsey said the ads would be funded by the agency’s budget.
“We look for a specific target market that we have to tap into,” said Dempsey. He said he would like the ads in the publications within the next two months so people could plan for their summer vacations.
Dempsey said that Manny Lann, executive director of the Cortland County Youth Bureau and a cyclist, mapped out the routes for the brochure. He said that Lann suggested the marketing plan more than a year ago.
“The whole purpose is to promote Cortland County and bring people to bike ride in the county,” Lann said.
In the brochure is a map of six routes cyclists can follow while on a biking tour of Cortland and neighboring counties.
The shortest route is the Song Lake Crossing Loop, which stretches 26 miles. It starts in the city of Cortland and goes through Preble and Homer.
The longest route stretches 70 miles throughout the county and goes through Cincinnatus and Marathon.
Some of the routes go into adjacent counties including Onondaga, Tompkins and Cayuga. All the routes start and end in the city of Cortland.
The brochure gives a series of safety tips that cyclist should abide by. Also, it lists entertainment opportunities and wineries that guests of the county could visit.
He said the routes are consistent with touring since cyclists would be sharing the road with vehicles. Cyclists would likely stay the weekend, Dempsey said.
Dempsey talked to hotels in the area about organizing a cycling package and he said that a lot of the hotels were interested.
General Manager of the Hampton Inn Jeff Lee said he was interested in the program and is in the preliminary stages of putting packages together. He said more than likely there would be a nightly and weekend package because he wouldn’t want to “restrict” anyone. As of now he said there is no fixed price and promotion would start in about a month.
“It is a huge attraction for this area,” said Lee.
Dempsey said a couple could spend approximately $600 for a weekend. Cycling is the most popular outdoor activity in the United States, he said.
“In the past five years cycling destinations — which is what we hope to become — has attracted 27 million visitors (nationwide),” Dempsey said. He added that 65 percent of the people who cycle have an income of $60,000 or more.