December 01, 2006

To Do This Weekend

The McKeesport Symphony Orchestra Christmas concert is tomorrow at 7:30 p.m. in the auditorium of McKeesport Area High School, 1960 Eden Park Blvd. There will also be a performance by the Mon Valley Children's Choir and a sing-along. The Joe Negri Trio is also scheduled to appear. For more information, visit the MSO website or call (412) 664-2854.

Meanwhile, just across the street at the Jacob Woll Pavilion in Renziehausen Park, the 21st Annual Festival of Trees is underway, today, tomorrow and Sunday. Dozens of themed, decorated Christmas trees from groups and individuals are on display from 12 noon to 9 p.m. each daily, and the Viking Lounge trolley bus will be shuttling visitors around Renzie Park.

Admission is $2 for adults, while children 12 and under are admitted with a canned good for donation to the Greater Pittsburgh Community Food Bank. Visit the McKeesport Recreation Committee's website for details.

Finally, McKeesport Model Railroad Club, 2209 Walnut St. in Christy Park, is hosting its holiday train show weekends through Dec. 17. Hours are 6 to 9 p.m. Fridays and 11 a.m. to 5 p.m. Saturdays and Sundays, and a donation of $4 for adults and $1 for children is requested.

The club's 40-by-80 foot layout will be fully operational, and free parking is available behind the club building on Kountz Alley or across Walnut Street at CP Industries. Call (412) 664-LOCO or visit the website.

Posted at 08:04 am by jt3y
Filed Under: default | No comments | Link To This Entry

December 01, 2006

Pouring Out My Frustrations

Chances are your neighborhood has one of those "Bermuda Triangle" pizza shops. Usually they spring up in old storefronts, though I've seen old gas stations used, too. One week it opens as "Mama Gina's Pizza." Two months later, it's "Rocky's." Two months later it's "Tony's."

And so on, an endless cascade of faded ambitions and squandered money --- no one ever seems to question putting another pizza shop where the last seven have failed. "My frozen dough and canned tomato sauce, along with surly help and high prices, will conquer this neighborhood's pizza-related needs!" the entreprenuers tell themselves.

I've always wanted to meet the bankers who loan money for these ventures. Have they ever heard of "due diligence"? "Gross malfeasance"? "Criminal incompetence"?

A large object lesson is playing out right now in Pittsburgh and Latrobe, where lawyers are trying to untangle the mess that is Gregory Podlucky's failed LeNature's Inc. According to my former cow-orker Rich Gazarik, who's been covering this story like the dew for the Tribune-Review, LeNature's ran up $700 million in debt while generating about $20 million in revenue last year.

. . .

If I went out and borrowed 35 times my income, at some point even Visa or MasterCard would say, "Gee whiz, it may be a bad idea to keep extending credit to this jagoff." But in the world of high finance, we are pikers who don't know how to play the game.

Incidentally, this explains why your bank is giving you 2 percent interest on your savings account while charging 10 percent on your home equity line-of-credit. The 8 percent spread allows the commercial loan department to keep shoveling out piles of cash with no apparent idea where it's going.

So, how does one tank (no pun intended) a bottling company like LeNature's? Let us count the ways. Court-appointed accountants and lawyers claim that LeNature's was:

• Selling products for less than they cost



• Expanding capacity (like adding a 500,000-square-foot plant in Phoenix) far beyond demand



• Using short-term, high-interest loans to pay off long-term, low-interest loans

One court-appointed administrator "said Podlucky is a poor businessman," Rich writes in the Trib.

If all that's true? Uh, yeah.

The more serious accusations (not proven) levelled at LeNature's include what Len Boselovic of the Post-Gazette labels "monumental accounting fraud," including falsification of documents, hiding assets and destroying financial records.

. . .

I'm not sure why it took this long for people to figure out that LeNature's was a house of cards. Until fairly recently, the company was advertising on KDKA radio, so I went out several times to find some LeNature's juice or iced tea.

I couldn't, not in gas stations, convenience stores, supermarkets or the cheap dives where I usually hang out. Not in vending machines or discount stores, either. I'm sure they were for sale, but I didn't see them.

I even looked a few months ago in the BP mini-mart in downtown Latrobe --- almost in sight of the LeNature's plant. Nothing.

One might suspect that before someone invested in a product like LeNature's, they would go to the store and see if they could sample it. One would, apparently, be wrong.

. . .

To add irony to irony, Podlucky got some of his money to invest in LeNature's by selling his stake in Jones Brewing Company down in Smithton, which the Podlucky family took into bankruptcy a few years ago. They emerged from Chapter 11 after closing the historic brewery and laying off most of the employees.

Stoney's Beer is now just a trademark on merchandise, and what's still sold as "Stoney's" is actually bottled by Pittsburgh Brewing Company ... which itself seems perpetually on the verge of going out of business.

LeNature's was itself in serious legal trouble twice before --- in 2001, they improperly listed their products as "kosher" without the approval of the rabbi whose organization was being listed on their bottles.

The year before that, while operating under its old name ("Global Beverage Systems"), the state Department of Environmental Protection forced it to recall bottled water that was contaminated with e.coli bacteria. It turns out that Global didn't have a permit to bottle water.

Again, I ask: Doesn't anyone at one of these venture capital firms pick up a newspaper? Don't they ever try to use "The Google"? Didn't any warning signs pop up?

. . .

As a possible little sidelight into the corporate culture at LeNature's, read this guy's account of what happened when he posted a sarcastic, negative review of one of their products on his website.

He claims that they sicced a lawyer on him and his webhosting company, made harassing phone calls to his home and tried to crash his site. He's since set up a page on his blog where disgruntled laid-off LeNature's employees can vent grievances.

One of those employees claims Podlucky "had a paddle displayed in the main hallway" at LeNature's headquarters, inscribed with the words "The beatings will continue until morale improves," and that a bulletin board was used to shame employees by posting their mistakes for their cow-orkers to read.

None of the accusations may be true, of course, and I'll be interested to see what happens in court when Podlucky and his allies have a chance to defend themselves.

In the meantime, if any of the investment bankers and Wall Street whizzes who underwrote LeNature's should happen to read this, would they please contact me?

I want to borrow some money. You see, I have my eye on this pizza shop down the block ....

Posted at 07:23 am by jt3y
Filed Under: default | four comments | Link To This Entry

November 30, 2006

Check It Out

A few days ago, Fast Eddie came to town, a-ridin' on a giant cardboard check. I'm glad he remembers how to get west of Harrisburg after the election --- on the other hand, since he rolled up a 20 percentage point victory in Our Fair City (in five precincts, Swann's vote didn't get out of single digits), maybe it's not too surprising.

I keed, I keed. I'm not one to look a gift governor in the mouth, though I am always sort of ... amused? annoyed? ... when state and federal officials "give away" money. After all, it was our money in the first place, before they took it, and now they're giving it back.

According to the Post-Gazette and Tribune-Review, the $4.4 million in loans and grants promised by The Gov will be divided between projects throughout the city:

• Redevelopment of Midtown Plaza: $1.2 million



• Sewer repairs, Christy Park: $1.8 million



• Neighborhood improvements, Christy Park: $120,000



• Street and sidewalk work, Fifth Avenue: $929,000



• Tax credits for new Sky Bank branch on Evans Avenue: $98,570



• Grant to McKeesport Hospital Foundation: $75,000



• Parklet improvements: $215,000

The sewer line repairs are from a PENNVEST loan, according to the Trib, while the rest of the money is coming from PennDOT, the Department of Community and Economic Development and the Department of Conservation and Natural Resources.

While the Christy Park improvements are vital to retaining that neighborhood --- a neat place to live, a highly walkable urban area, and a great value for first-time homeowners --- the changes Downtown are likely to be the most visible and noticeable to visitors.

"Working together, the state’s Community Action Team and city officials identified this four-block section of the business district as an area where state resources could leverage additional investment, sparking future growth," Rendell said, according to a state press release. "It’s an approach we’ve used across Pennsylvania with great results."

Kudos to Mayor Jim Brewster, city council and Allegheny County Executive Dan Onorato for pulling this package together. It's hard to believe that an investment of this size would have happened a few years ago, when council and the mayor's office were at each other's throats most of the time.

The challenge, however, is going to be getting private investment to match or exceed the public money. Too many landlords continue to treat the City of McKeesport as their private garbage dump, or do crummy repairs, apparently under the assumption that people in the Mon Valley can't tell the difference.

All of the street improvements on Fifth Avenue, for instance, won't disguise the fact that Don Farr Moving's storage facility (the old G.C. Murphy Co. home office complex) is painted the most unattractive shade of brown in history. Calling the paint "manure-colored" would be putting it kindly ... and now it's starting to peel.

All of the sewer improvements in Christy Park won't conceal the junk cars or broken sidewalks in front of businesses and homes on Walnut Street.

All of the redevelopment of Midtown Plaza won't help fill the still-empty People's Building --- which was supposed to have been sold back in the spring, though county tax records still list it under the previous ownership --- or the vacant Penn-McKee Hotel.

Let's assume for the moment that public money can jump start development, even though a lot of people will argue the point (especially Pittsburghers still paying for the convention center, stadiums and other projects).

It's up to property owners to actually drive the car.

The $4.4 million package may get the engine running for a while. I'll be more excited when I see someone actually get behind the wheel.

. . .

The Name Game: Yes, I have decided to stop calling the Trib the "Greensburg Astonisher" (which I adopted before Election Day when they insisted on referring to "Bobby Casey Jr." and "the Democrat Party").

And since I'm feeling generous, I'll start calling the P-G by its proper name instead of "A Local Newspaper" (which is what they call the Daily News).

I suppose I'm often petulant, but rarely for very long.

Posted at 07:27 am by jt3y
Filed Under: default | one comment | Link To This Entry

November 28, 2006

Steeler Fans Ready To Polka Their Eyes Out

I didn't get a chance to listen to any sports talk radio shows on Monday, but I'm assuming that Ellis Cannon and Gene Collier spent most of the time talking people off of bridges and window ledges. (Unlike Mark Madden, who would have been down on the street, yelling, "Jump! Jump!")

Collier, by the way, points out that there was a bright side to Sunday's debacle in Baltimore. The Steeler defense didn't screw up on any kick returns. Since they didn't score, there was no need to kick off, he says.

The Carbolic Smoke Ball reports that the Steelers have apologized to Jesse Jackson and Al Sharpton for their performance (rimshot).

The 27-0 drubbing at the hands of the Ravens so angered Bob Smizik of the Post-Gazette A Local Newspaper that he was reduced to talking like the crocodiles from the "Pearls Before Swine" comic strip. "They're not a mystery team at all," Smizik wrote. "They just not very good."

Hull-o-o-o-o-o, zeeba neighba Bob!

Meanwhile, on Sunday during my radio show (6 to 9 p.m. on 620 WKHB, entertaining literally dozens in the metropolitan Herminie-Edna No. 2 area), a local band dropped by to debut their new Steelers fight song. I hope you like it. I expect to hear from Jimmy Pol's attorney any minute now.

Posted at 07:55 am by jt3y
Filed Under: default | one comment | Link To This Entry