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Katzman: Manufacturing in Hudson is not dead

By John Mason

COLUMBIA COUNTY — When Kaz announced it will close its Greenport manufacturing plant in June 2009, that meant a 350-job hit to a local economy that already has experienced the closing of LB Furniture in May, and other recent closings such as McGuire’s overhead door plant and the Emsig button factory, with little job creation to take their place.

Despite all the bad news, Kaz CEO Richard Katzman disagrees with Hudson Mayor Rick Scalera’s statement that “manufacturing is dead in Hudson.”

“No, there’s not much right now,” Katzman told Hudson-Catskill Newspapers in a recent interview. “But with LB, Kaz, a couple others, it’s a good opportunity. The people in these manufacturing jobs are a good workforce: Any company would be fortunate to have. That’s what you look for.”

Hudson, he noted, is the highest-density location in the county. “You can walk to work or take the bus. Between Kingston, Poughkeepsie and Albany, this is probably the best location.”

The proximity to the Rip Van Winkle Bridge and the Thruway is a great advantage for this area, as well as to the intersection of the north-south and east-west highways to the north.

Katzman said the company is getting out of manufacturing to outsource its job to Keytronics, a contract manufacturer that can produce a diversity of products in one plant.

So should Columbia County look for a Keytronics-type of business to replace Kaz? No, Katzman said. Contract manufacturing wouldn’t succeed here because there’s not a dense enough workforce to support it, and the county is not in an ideal location to serve the whole country.

“With rising fuel prices, there’s a lot of pressure on freight rates,” he said. “You want high-density labor and low power costs. The Northeast wouldn’t support that.”

But Katzman is optimistic about Columbia County’s chances for attracting a good business employer to replace Kaz, and he’s working with local leaders to make this happen.

“I would look for a business in the $50 million to $200 million size that would find itself graduating into that building, rather than being shoehorned in,” he said. He pointed to the Serta Mattress factory in Coxsackie as a good model. Mattresses, Katzman said, are too big to ship across the country, so they need to be produced in regional plants.

“I am optimistic we’ll be able to bring a business into that facility,” he said. “It’s a great facility. I consider it part of our responsibility to be proactive in bringing someone in.”

Hudson Mayor Rick Scalera said he and Katzman met several times.

“It’s in his best interest to do what he can with his properties and not be concerned about the community,” Scalera said. “To his credit, that’s not the case. He will be working with Hudson, mainly on the properties on Cross Street.” As well as the two buildings on Cross Street now occupied by Stageworks, Kaz also built two large warehouses there.

Scalera said Katzman is working with State Sen. Steve Saland, R,C,I-Poughkeepsie, Assemblyman Marc Molinaro, R,C,I-Tivoli, the Empire State Development Corp. and local agencies and real estate agents to find a replacement for the Greenport plant.

“Unlike LB, we have a little time to work with this,” he said.

“Rick is one of the more proactive government people,” Katzman said. “He wants to see jobs and economic strength in the county. He’s thinking about it, working the different resources in state and federal government to network. If you care and are out there, making calls, marketing properties, when a business is looking to locate somewhere, you have an excellent chance of bringing someone in.”

The American economy is looking grim now, but “things go full circle,” he said. When the Japanese took over the top spot in automobile manufacturing from Detroit, they started building plants in the U.S.

“I think there’s a future, but it can’t happen by itself,” he said. “In the south, the states really went after those car companies. They gave them lots of tax breaks and incentives. New York doesn’t do enough of that — there’s a very defeatist attitude in New York. The reality is, it can compete very well.”

After Kaz closed, he said, New York came in with strong resources to help with transitioning, training and benefits for workers.

“They’re good with the aftermath,” he said. “But when it comes time to attract companies to the facility — this is probably the best facility in a 40 or 50-mile radius. I haven’t had anyone come forward — Kirsten Gillibrand’s office is the closest. They said, ‘We want to work with you.’ They’re also helping out with placement.

“If this were South Carolina, somebody’d be in there, getting pictures, cataloging resources, seeing what kind of business would make sense here,” he said. “As a lifelong New Yorker, it distresses me that they’re better at helping with the aftermath: They’re like FEMA [Federal Emergency Management Agency] as opposed to the WPA.” [Works Progress Administration, the 1930s New Deal agency that provided jobs for millions of unemployed workers].

Twenty-thousand square feet of the 200,000-square-foot plant is used for office space, and will continue to be so after the plant closes down in June 2009. Between 50 and 60 Kaz employees will remain at the plant, and Katzman said he has a commitment to keep them there.

“We’re getting out of manufacturing for good business reasons, we’re keeping these people for good business reasons,” he said. “If we were moving these jobs, we’d have done it.”

Should a company want to buy the entire plant, Katzman said, there’s plenty of office space in Hudson, such as at the Hudson City Center.

Asked whether he regrets his opposition to the St. Lawrence Cement’s proposed Greenport plant, he said no. “One, it didn’t create any new jobs, and two, it would have severely detracted from the quality of life here, and the businesses that are here and could be attracted to be here. I would still be opposed to it.

“I’m very optimistic that there are businesses that have come here and will continue to come here that are clear winners for the communities in creating jobs that will succeed here,” he said.

Katzman emphasized that the closing is six to nine months away, “not six to nine days or weeks.”

“Since the company is healthy, we have the ability to provide outplacement services with a local firm,” he said. “In conjunction with that, we can get all the benefits available — there are special NAFTA benefits available [to provide workers extended unemployment benefits during their job searches]. We’ve had preliminary talks with (Columbia-Greene Community College) to see what kinds of training are available to position workers for jobs in new industries.

Kaz employees will vary in how transferable their skills are, he said. “The company has a good plastic molding operation, a skill that’s not that easy to find, and there are a fair number of molders in the area,” he said. Material handling is applicable to almost any business, he said, as are fork trucks, warehouse workers and supervisors.

And when the empty spaces are filled, “a couple of businesses will end up with a windfall of really good people,” Katzman said.

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