Foundation Newsletter November 2009
Special thanks to our investors...
who make possible our work of improving Pennsylvania's competitiveness and economic prosperity:

1st Summit Bank
AccuWeather, Inc.
Aqua America, Inc.
Allegheny Energy, Inc.
ASK Foods, Inc.
AT&T
Blue Cross of Northeastern PA
Bradford Energy Company
Brandywine Realty Trust
Bucks Fabricating
CanAm Enterprises
Carnegie Corporation of New York
Central Penn Business Journal
CenturyLink Corporation
Clarion University
Consol Energy (new)
CTC Foundation
Custom Group Industries
Duquesne Light Company
DVL Incorporated
Egan Bloom & Associates, LLC
Erie Insurance
First Energy Corporation
Gannett Fleming, Inc.
Glatfelter Insurance Group
Greater Philadelphia Chamber of Commerce
Herbert Rowland & Grubic Inc.
Hershey Entertainment & Resorts Company
High Industries, Inc.
Howard Hanna
KPMG
Lobar Construction Inc.
L. Robert Kimball & Associates
McNees Wallace & Nurick, LLC
Mericle Development Corp.
Metro Bank
Metropolitan Regional Council of Carpenters
Milestone Partners
PA Department of Community & Economic Development
ParenteBeard LLC
Pennoni Associates, Inc.
Pepper Hamilton LLP
Perform Group, LLC
Pittsburgh Tech Council
PPL Corporation
Sanofi Pasteur
Sheetz
Sony Technology Center - Pittsburgh
SuperUser Technologies, Inc.
The Lenfest Foundation
The PNC Financial Services Group, Inc
Wawa
Winner International Corporation
The Wolf Organization
Zippo Manufacturing

Team Pennsylvania Foundation is a private/public 501(c)(3) non-profit organization.

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Thanking those that invest in the future of Pennsylvania.



Custom Engineering maintains solid manufacturing base


ERIE - As the owner of three manufacturing companies including Custom Engineering, Tom Hagen knows the economic well-being of the nation rides on the long-term health of that industry.

And while that sector has been especially crippled by the economic downturn that has not only swept the U.S. but the entire global community, Hagen has faith that the economy will recover. In fact, he says there are signs of that already happening.

“I just read that the stimulus money is working and only 40 percent of the TARP (Troubled Asset Relief Program) money has been put into the financial stream,” Hagen said. “I believe we’ll start to see new orders trickle in during the first part of 2010. We’ve grown over the past 12 years, and I believe we’ll continue to do so in the future.”


James Ohrn, Vice President and Chief Financial Officer, Custom Engineering, Erie, inspects a platen built for a turbine.

An investor in Team Pennsylvania Foundation, Custom Engineering is a fabrication and machining company located in a 140,000-square-foot facility. Hagen also owns LamJen Inc, a precision machinery business, and Venango Machine, which manufactures hydraulic press components.

In business since 1954 (Hagen has owned the company the past 12 years), Custom Engineering specializes in medium to heavy fabrication and machining and is recognized as a world leader in the manufacture and refurbishing of heating platens for the transportation, power generation, steel, air compression, chemical processing, petrochemical, forest, plastics, aerospace and laminate industries.     

“As our name implies, we enjoy the challenge of custom jobs, and we’ve invested in the technology to complete them on time and on budget,” Hagen said. “In fact, we have the experience, enthusiasm, and equipment to do custom manufacturing jobs that no other company can do.”

Hagen said quality service is ensured as Custom Engineering is both ISO- (International Organization for Standardization) and ASME- (American Society of Mechanical Engineers) certified.

“These certifications assure our customers that they receive the highest quality products and, for us, we have long-term, satisfied customers,” Hagen said. “It’s costly to do, but we have had very good results in offering that training on-site.”

Hagen said most of the company’s regular customers are located within a 500-mile radius of Erie, but Custom does have an international presence.

Despite running three companies and having extensive involvement with other groups, Hagen still has time for the organization he helped build as one of the Foundation’s Founding Fathers.

“I think as residents of Pennsylvania, we all want to see the state prosper, and Team Pennsylvania is at the forefront of making that happen,” Hagen said. “It’s a quality of life issue that impacts our employees, our customers and everyone in the commonwealth.”

Hagen added that Team PA’s value is demonstrated in its ability to be non-partisan.

“Being involved in the creation of Team PA and seeing it thrive for 13 years, really demonstrates the value the Foundation brings to the commonwealth,” Hagen said. “Governor Rendell has been a very active supporter and champion of the Foundation too.  The fact that it has worked with three administrations speaks well of the Foundation, its mission and to the non-partisan nature of the organization.”

FOUNDATION NEWS--------------------------------



Commission approves high school graduation standards

Pennsylvania school students face a brighter future and the business community a stronger workforce with the Independent Regulatory Review Commission’s (IRRC) recent approval of more rigorous high school graduation requirements.

The state’s IRRC voted 4-1 to approve the proposal that the State Board of Education has been seeking to strengthen the Commonwealth’s graduation requirements. The regulation now goes to the attorney general for final review and then will be published in the Pennsylvania Bulletin, which is the final step needed for this initiative to take effect.

“Lead commissioner (John Minzer) cited the support of Team PA as a compelling reason to enact graduation standards and accountability,” Rich Hudic, President & CEO, Team Pennsylvania Foundation, said. “It was the hard work by all the CEOs who made the case for this regulation.”

Proponents, including the business community, see the regulation as a way to ensure all students leave high school with a core set of skills. Business leaders also see the standardization of what skills graduates must possess as important in today’s mobile society.


Joseph Torsella, Chairman, State Board of Education, center, makes a point to the members of the Independent Regulatory Review Commission at a hearing on graduation standards as Dr. Gerald Zahorchak, Secretary, Pennsylvania Department of Education, right, and Dr. Jim Barker, Superintendent, School District, City of Erie, listen.

Team PA Board Co-Chair Karen Winner, Chief Executive Officer, Winner International, and C. Alan Walker, President & CEO, Bradford Energy Company, backed the proposal and offered testimony at hearings across the state earlier this year.  

“Pennsylvania businesses can now have an understanding of what basic skill set and qualifications are expected from a Pennsylvania high school graduate,” Winner said. “No more guessing based on what school district he graduated from and hopefully an end to the need for employee remediation. We can both expect success – a successful transition from school to work and success on the job.”

“The best thing I can say about the IRRC ruling is that the real winners are our students and the Commonwealth of Pennsylvania because the changes should result in our graduates being much better prepared for the workplace required in today's world,” Walker said.

Gerald Zahorchak, Secretary, PA Department of Education, said students, educators and the business community will benefit from the new regulation.

“The regulations approved today will benefit our business community by ensuring Pennsylvania’s high school graduates can succeed in our high-skills, globally competitive workforce.The regulations will benefit the education community by giving teachers a vital tool to ensure students know what they are supposed to know before they leave high school,” Zahorchak said. “And these regulations will benefit our graduates, who will have the assurance that the diploma they receive truly represents a readiness to compete and succeed in college or the workforce.”

Visit www.pde.state.pa.us for more information.


Team PA enters "race" for federal funding for schools

As part of its strategic mission to support education and workforce development, Team Pennsylvania Foundation is playing an active role in the Race to the Top grant application process, which will provide critical federal funding for public schools across the commonwealth.  

“Race to the Top is a phrase that should be on every educator’s lips,” Rich Hudic, Team PA President & CEO, said. “These funds could be a saving grace for many schools suffering from budget cuts and teacher shortages.”

Team PA sponsored a meeting recently to discuss Race and how it can be incorporated with the Foundation’s Science, Technology, Engineering and Math (STEM) Initiative.

“Although Race is not based around STEM, states like Pennsylvania who have a specific STEM strategy have a competitive priority and advantage over states that do not have this program,” Hudic said. ”This is another example of STEM paying dividends to students in Pennsylvania schools who will one day enter the workforce.”

Funding is provided through the American Recovery and Reinvestment Act and is based on four critical criteria: standards, data systems, teacher effectiveness and assistance for struggling schools.

Improving academic standards and tests have been a leading priority for the Pennsylvania Department of Education, as evidenced by the recent passing of the graduation assessment standards regulation.
 
Hudic said the purpose of setting up data systems is to track a student’s educational process from one year to the next.

“Pennsylvania was honored earlier this year by the Data Quality Campaign, which is the education department’s current yardstick for data systems, for our progress in implementing comprehensive efforts to monitor and improve instruction,” Hudic said. “Race to the Top would help expand those efforts even further.”

Additional PDE goals include boosting teacher effectiveness and getting more quality teachers into low-performing schools.

“Working through the existing STEM Regional Network, for instance, we are looking to get 500 new STEM teachers into low-income and high-minority school districts across the state,” Hudic said.

The final priority centers on providing help to struggling schools.

“The proposed Race efforts will build off a commitment to improve quality and opportunity in those school districts who serve historically disadvantaged students,” said Hudic. “Working from the department’s existing turnaround efforts, these plans will target increasing student achievement on the PSSAs while boosting high school graduation rates in at-risk school districts.”

Funding is expected to be awarded between May and December 2010.

Investor Exchange

Pennsylvania Auditor General Jack Wagner accepts a Team Pennsylvania Foundation golf jacket from Karen Winner, co-chair, Team Pennsylvania Board of Directors, following an Investor Exchange luncheon with the potential gubernatorial candidate.

Team PA sponsors meeting with investors and potential gubernatorial candidate

Pennsylvania Auditor General Jack Wagner met November 4 with about a dozen Team Pennsylvania Foundation investors to discuss his work as the state’s top watchdog of government and to spell out the priorities facing the commonwealth that he would address if elected as the next governor in 2010.

The meet and greet with Foundation investors and Wagner was the first in a series of such events with potential gubernatorial candidates as part of the Foundation’s outreach known as Investor Exchange.

“The Investor Exchange program is designed to allow Foundation investors to meet in a casual setting with the top movers and shakers in Pennsylvania,” Rich Hudic, Team Pennsylvania Foundation President & CEO, said. “Over the coming months, investors will have the opportunity to meet with the potential gubernatorial candidates to learn more about their views and platforms prior to the May primary.”

To learn how you can be invited to future Investor Exchange programs, please e-mail Team PA here.

Act 44 addresses pension issue


The state took the first steps recently toward creating municipal pension reform through passage of Act 44 of 2009.

“Team Pennsylvania applauds the Legislature for realizing the urgent need to address an issue that has the potential to financially devastate many municipalities and the commonwealth within the next three years,” Rich Hudic, Team Pennsylvania Foundation President & CEO, said. “There is, however, much more work to be done on this issue and Team Pennsylvania and its partners will continue to collaborate to ensure our municipalities are not crushed by this impending financial tsunami.”

As it stands right now, homeowners across Pennsylvania would see property taxes soar in 2012 if pension reform for local and state government workers and school teachers isn’t addressed.
The Commonwealth Foundation released a study showing how much taxes would increase annually for school districts across Pennsylvania with the statewide average being over $1,200.

Team Pennsylvania has been working on this issue with the Pennsylvania Economy League, the Allegheny Conference on Community Development, Pennsylvania Chamber of Commerce, Greater Philadelphia and Pittsburgh Chambers of Commerce and GSP Consulting.

For more information on Act 44 of 2009.

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Foundation audit delivers a clean report

Team Pennsylvania Foundation received a “clean” opinion on its 2008-09 audit by the accounting firm of Brown Shultz Sheridan & Fritz (BSSF).

“An audit is an important management tool for an organization like Team PA that has 501(c) 3 non-profit status,” Matt Zieger, Chief Operating Officer, Team Pennsylvania Foundation, said. “It’s vital that our operation be transparent and our business is conducted in a prudent manner on behalf of those businesses who realize Team PA is the premier place to invest to effect positive change in the commonwealth.”

Zieger said the audit revealed the Foundation’s expenses for programs and initiatives were over 90 percent while costs to administer and operate the organization were less than 10 percent.

“Sound business practices are the hallmark of Team Pennsylvania Foundation and we are happy to report that tradition continued during the past fiscal year,” Zieger said.


A breakdown of Foundation expenses for FY 08/09.

Business permitting, shared services highlight meetings


Team Pennsylvania Foundation staff participated in two different meetings recently as part of its long-range strategy to enhance government effectiveness and efficiency.

The first was held by Team PA and 10,000 Friends of Pennsylvania, in cooperation with the Pottstown Chamber of Commerce, on shared municipal services reform in that region of the state while the other was with Department of Environmental Protection (DEP) officials on ways to revise business permitting issues.

Rich Hudic, President & CEO, Team Pennsylvania Foundation, said the organization is working with DEP to streamline the business permitting process.

“Team PA is working to cut the bureaucratic red tape that hinders business owners from receiving the permits they need in a timely manner,” Hudic said. “These delays cost Pennsylvania businesses an exorbitant amount of time, money and valuable resources and are a detriment to the economic prosperity of the commonwealth.”

Hudic said the shared municipal services meeting was another in a series of ongoing sessions around the state to gather information and gauge the business community’s pulse on how municipal services can be combined without negatively impacting local communities.

“Local business leaders shared their challenges and concerns on the obstacles that hinder the expansion and growth of their operations,” Hudic said. “They mentioned the roadblocks they face, the need for greater governmental customer service, a desire to build better local government leadership and their vision for enhanced regional cooperation.”   

Team Pennsylvania using its unique position to convene the public and private sectors to enhance government effectiveness and efficiency is one of the key provisions of its long-range strategic plan, Hudic added.

Pennsylvania participates in green energy trade show

Pennsylvania showcased to an international audience its desire for a greener planet and its commitment to developing green technology and business throughout the commonwealth at the recent Taiwan Green International Show.

Pennsylvania’s presence at the conference was made possible by a grant from Team Pennsylvania Foundation, said Foundation President & CEO Rich Hudic. 

“From helping to bring Gamesa and Conergy to Pennsylvania to our International Press Tours which have touted Pennsylvania’s commitment to a greener tomorrow, Team Pennsylvania has helped carry forth the Rendell Administration’s vision to make the commonwealth a world leader in this industry,” Hudic said. “Our goal at the conference was to showcase Pennsylvania as a great place to do business and to share our many successes to a world audience. This kind of event is a financially prudent way to market the state and potentially attract good-paying jobs to the commonwealth.”

Pennsylvania had a booth at the event in cooperation with six Pennsylvania companies, and two others (through their trade representatives in Taiwan) purchased their own booth space.


Visitors check out the state's trade booth at the Taiwan Green International Show.

The state’s foreign trade office also participated in a seminar on Marketing Opportunities for Green Technology in the U.S.

Peter Ciotoli from Weston Solutions, West Chester, was the keynote speaker at a presentation entitled "Sustainable Green Development International Standards, Opportunities and Considerations."  

The presentation described how sustainable and green construction objectives are now a driving force in many international construction projects. Green Sustainable Development projects, as a new market growth area, focus on the entire life cycle of the project, according to Ciotoli.

There are opportunities for Taiwan firms to participate on a global basis and there are global trends in sustainable programs that may influence how sustainable programs evolve in Taiwan's future.

International Week showcases Pennsylvania businesses

Pennsylvania companies interested in selling their goods and services overseas can network with trade representatives to find opportunities overseas during a series of meetings that will be held across the state during “Pennsylvania International Week” next month, Governor Edward G. Rendell said.

The meetings, Nov. 9-18, will include nine of Pennsylvania’s 24 authorized trade representatives from Brazil, Canada, Chile, Czech Republic, Mexico, Saudi Arabia, South Africa, Taiwan, and the United Kingdom.

“Exports from Pennsylvania firms play an increasingly important role in the state’s economy,” said Governor Rendell. “We help Pennsylvania companies evaluate export readiness, research new markets, locate qualified buyers, and find funding to start or expand in international markets. Pennsylvania International Week helps us introduce small and medium-sized companies to new markets and potential clients, without the time and expense of travel.”

The Department of Community and Economic Development’s Regional Export Network is hosting the event. The network is a group of international business development organizations located throughout the state that serve as local points of contact and assistance for Pennsylvania exporters.  

The work of the Regional Export Network has been a key force for Pennsylvania’s more than 12,000 exporters, who shipped $34.4 billion worth of goods in 2008, an increase of nearly 18 percent over 2007, and well above the national 11.8 percent increase among all U.S. states.

For more information on International Week, visit the DCED Web site at  www.newpa.com.

State receives weatherization funding

Governor Edward G. Rendell announced recently that the first installment of $123 million in federal recovery funds for weatherization were to be released on Nov. 2, part of $253 million that the state will use for this purpose.

The governor said the funding represents an unprecedented level of investment that will help to create new, “green” jobs, save money for struggling families, and stimulate local economic activity as weatherization agencies buy required material, vehicles and equipment.

"The weatherization program stimulates the economy in several ways,” Governor Rendell said. “It saves money on energy bills for people who need it the most, and keeps those dollars circulating in local communities because families will be able to spend more on food, clothing and other necessities. It also will create new jobs in the growing ‘green’ economic development sector.”

Pennsylvania’s allocation of $253 million for weatherization from the federal American Recovery and Reinvestment Act is the fourth largest in the nation; only New York, Texas and Ohio received more. The money will be paid over three years.

The first of the Recovery Act funds to the state’s 43 weatherization agencies, $123 million, were disbursed Nov. 1. Payments to agencies are expected to be completed by mid-November.

Pennsylvania will allocate the federal grant over three years, through March 2012, expending at least 50 percent of the recovery allocation by Sept. 30, 2010. At least 80 percent will be allocated by the end of the 2010-11 fiscal year.

To read more, visit www.newpa.com.

Electric car company to create 400 jobs in the state


Electric cars like these will soon be built in Pennsylvania following
an agreement with the state and the company that builds them.


PITTSBURGH – Governor Edward G. Rendell recently announced that one of the world’s leading companies in electric vehicle technologies, CT&T Co. Ltd., intends to open two production and distribution facilities in Pennsylvania and create up to 400 jobs in the process.
 
The company’s decision, the governor noted, was based on the state’s investments in its economy and its network of advanced technology companies and innovative universities.

Team Pennsylvania Foundation contributed as it facilitated meetings between state and company officials, according to Rich Hudic, Team PA President & CEO.

Gov. Rendell made the announcement at Carnegie Mellon University, which is working to develop new technologies that can be used in electric vehicles, such as lithium batteries, fuel cells, electric motors for improved efficiency and output, and fast electric charging stations that can recharge a battery in minutes as opposed to two hours.

“This is a win-win-win for the commonwealth,” Governor Rendell said. “With consumers opting for more fuel efficient vehicles and automobile manufacturers working to meet new fuel economy standards, electric vehicles represent a growing market opportunity. It’s no secret that many of the world’s large automotive manufacturers are developing plug-in electric vehicles, so the fact that CT&T has chosen Pennsylvania is very exciting news for us, because it gives us an early presence in a promising market.”

CT&T makes low- and mid-speed, short-distance “neighborhood electric vehicles” that pass crash tests required for regular passenger cars. The vehicles sell for about $12,000.

“There are other benefits to having a company like CT&T choose Pennsylvania,” Governor Rendell added. “CT&T’s electric vehicles will create new employment opportunities and spur the need for new investments in our economy that will upgrade our infrastructure and develop exciting new technologies.”

As the demand for electric vehicles grows, the governor said, companies and universities like CMU will be asked to develop more efficient and economical batteries, while the nation’s electrical infrastructure will need to be upgraded to accommodate vehicles in need of a recharge.

The governor noted that the company’s interest in Pennsylvania resulted from the state’s presence in Seoul, South Korea, which was part of his World Trade PA initiative. He also said that the Governor’s Action Team is working to establish a business assistance package that will help finalize the company’s move to Pennsylvania.

“We are looking forward to becoming a contributing part of Pennsylvania’s bold moves to become a leader in green transportation and the creation of green technology jobs,” said CT&T President Young Gi Lee. “Our plans are to locate the first regional assembly and sales facility in the northeast - in Pennsylvania. We feel our efforts here will be a showcase for other states and municipalities throughout the United States.” 

The company is focusing on sites on the Delaware River in Philadelphia for its initial Pennsylvania location.

Company executives visited five prospective sites in the Pittsburgh region, including two within the city. While in Pittsburgh, CT&T executives also met with experts in battery and fuel technology from Carnegie Mellon University, which is engaged in a range of research initiatives to support the growth and development of electric vehicle technology.

CT&T could open a third assembly and sales facility elsewhere in the state at a future date.

Lee said the company’s long-term business plan calls for 40 regional assembly and sales systems in North America.
CT&T has been exporting to China, Canada, the United Arab Emirates, Japan, and the United States since 2005. The company says cities with large municipal fleets offer a considerable initial market opportunity, with the electric car as a low-cost option for parking authorities, parks and recreation departments, and similar agencies with short-distance, low-speed vehicle needs. CT&T has a contract to supply 4,000 neighborhood electric vehicles to California police organizations, which will use them as downtown parking supervision vehicles.



Investor News features member activities

Team Pennsylvania Foundation premiered last month a new feature called Investor News. It's designed to share press releases and news announcements among members of the Foundation's family of investors. Foundation investors are asked to mail their news for posting on the Team PA Web site to investornews@teampa.com.

Here is a sampling of what you will find:

Foundation board member donates $2 million to Penn State.

Member advocates manufacturing training to school board.

Howard Hanna moves up the Top 100 list.

Sanofi Pasteur receives additional flu vaccine order.

To catch up on the latest news from Foundation investors, click here

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