USW locals not united on pact

While 14,000 union steelworkers at 14 ArcelorMittal plants await details of the tentative labor pact reached last weekend, some local union officials at U.S. Steel Corp. plants have opposed a similar settlement covering their members.

"You've got your pros and cons on it. You've got the benefits improvements, but I think they should have gotten more," said Andrew Miklos, president of United Steelworkers Local 1557 at U.S. Steel's Clairton coke plant, which has about 1,210 members. He wanted improvements in the grievance procedures and language limiting the company's ability to contract work at the plant out to other companies.

Miklos said he was one of nine local union presidents to vote against the settlement that the USW's bargaining committee presented to the local presidents on Aug. 11. Despite his opposition, Miklos said the union officers at Clairton did not make any recommendation on how members should vote.

The 16,000 USW members at the 12 U.S. Steel plants covered by the four-year agreement have until Tuesday to mail their votes on the contract to USW headquarters in Pittsburgh. If approved, it would be retroactive to Sept. 1, the expiration date of the old pact.

Tom Conway, chairman of steel-industry bargaining for the union, said he was confident that members will approve the pacts.

Steelworkers at U.S. Steel and ArcelorMittal will get a $6,000 ratification bonus if the contracts are approved. They will get a $1 an hour increase in the first year and 4 percent wage hikes in each of the remaining three years of the contract.

But giving percentage increases rather than a specific amount will create divisions within the work force, because higher-paid workers will get more of an increase, Miklos said.

U.S. Steel and ArcelorMittal have agreed to invest $3 billion in their plants, an investment the USW sought to ensure the plants remain competitive and make jobs more secure. Pittsburgh-based U.S. Steel has committed to invest $1 billion in new coke ovens at Clairton.

Chuck Jackson, president of USW Local 1219 at the Edgar Thomson Plant in Braddock, and Joseph Ballas, president of USW Local 2227 at the Irvin Plant in West Mifflin, could not be reached for comment.

Unlike the settlement with U.S. Steel, the proposed agreement the union reached with ArcelorMittal on Saturday had the support of 13 of the 14 local union presidents at ArcelorMittal plants. Voting on the ArcelorMittal contract also will be conducted by a mail-in ballot, and the deadline to return those ballots has not been set, USW spokesman Tony Montana said.

The ArcelorMittal contract covers the tin mill plant in Weirton, W.Va. Mark Glyptis, president of USW Local 2911, which represents about 950 steelworkers at Weirton, was pleased with the deal because he said it achieved economic and employment security for the workers, a commitment for investment and retirement security.

The commitment to invest in the plants was "terribly important to us," Glyptis said, because "the goal is to be the premier tin producer."

"Some very good things are going to happen at Weirton (mill)," Glyptis said. He declined to say if that involves restarting the steel production at the mill.

The contract does not cover steelworkers at Koppers Inc.'s coke-producing plant in Monessen, which ArcelorMittal is in the process of acquiring, Montana said. Koppers, based in Downtown, said the sale should be completed by the end of the year. When that occurs, the issue will be addressed, Montana said.

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Heating oil prices a wild card

The heating oil business these days is so difficult to predict that third-generation distributor Mike Adams some days wishes he hadn't been born into it.

"Everybody is calling, but it's hard to see which way the market's going," said Adams, owner of Adams Petroleum in Emsworth. "I can't tell people what to do."

No one is certain which way heating oil prices will move as the official start of the heating season on Oct. 1 draws near. In mid-August, the Department of Energy's Energy Information Administration, in its monthly short-term energy outlook, projected that heating oil prices on average would jump some 31 percent to $4.35 a gallon this heating season, from $3.31 a gallon one year ago. Adams currently is delivering heating oil priced in the mid-$3.60 range.

But the projections were produced before Hurricane Gustav missed or did only minor damage to crude oil-related equipment in the Gulf of Mexico. Traders took reports of little damage as a sign from above and promptly bid down future heating oil prices.

"The industry is in such a state of flux, it's possible our August forecast may be out of date, and we will be revising last month's projections when the new outlook comes out on Sept. 9," said Neil Gamson, an Energy Information Administration economist. "Crude today (Tuesday) already fell about $9 a gallon, and heating oil was down about 23 cents a gallon."

Yesterday, crude for October delivery closed down $5.75 to settle at $109.71 a barrel on the New York Mercantile Exchange, after earlier dropping as low as $105.46. It was the lowest trading level since April 4, just before oil began an unprecedented march above $147 per barrel. In addition, heating oil futures fell 11.83 cents to settle at $3.0736 a gallon.

Adams said he worked Labor Day loading his delivery trucks with heating oil because he was afraid prices would leap and customers would be calling, but that didn't happen.

Many experts and industry watchers aren't convinced a day of falling prices will hold once cold weather hits Western Pennsylvania. The nation's 10 million oil-heated households are concentrated in the Northeast.

"There basically are three reasons why heating oil prices will climb," according to Kent Moors, a Duquesne University professor and director of the school's Energy Policy Research Group. "No. 1, this country doesn't have enough refinery capacity for medium and low distillates, which includes heating oil."

Second, Moors maintains, refinery owners for some time have been withholding about 10 percent of refinery capacity to keep margins, or the price for crude oil and refined products, high. The U.S. refinery utilization rate is below 90 percent.

"Reason three is that other parts of the world have an overabundance of heating oil, Russia being one of those areas, so we're importing more and more heating oil," Moors said.

Adams said he doesn't have any hard numbers, but he believes a number of customers have switched fuels, to natural gas or electric, perhaps to get a more stable price.

Energy trader and analyst Phil Flynn, of Alaron Trading in Chicago, calls the heating oil situation a "tale of two markets."

"We are down from the big highs of earlier in the year, but are still higher than where we were one year ago," Flynn said.

Flynn predicted area heating oil prices "should" fall below $3 a gallon in the near future, "but we can't have anything else go wrong."

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Lawrence County tire recycling facility loses state permit

The state Department of Environmental Protection revoked a permit for a Lawrence County tire recycling firm after conducting 12 inspections in less than a year.

Lion Enterprises 7/11 must relinquish its waste tire-processing permit within seven days and forfeit a $25,000 bond it held for the New Castle facility.

"Every time we've visited, we found violations that we documented (and) then presented to the owner," said Frieda Tarbell, spokeswoman for the department's Northeast Regional Office.

The company applied for the permit in February 2007 but began operation in the summer months, Tarbell said. At the first inspection, on Aug. 27, 2007, the department began finding violations. On Sept. 6, it found the company failing to make daily operation records available and storing more tires on site than the permit allowed.

A month later, the department found approximately 130 tons of waste tires were being stored on an adjacent property without a permit. Lion Enterprises also transported waste tires to a nonpermitted site in Hickory.

Since April, the company's phone has been disconnected, Tarbell said. Owner John Mowat, who resides in Hacienda Heights, Calif., could not be reached for comment.

Tarbell said the extreme number of inspections in a short timespan is not typical.

"When companies are getting up and running, we want to check if it's running smoothly," Tarbell said. "Typically we would alert the owner to get them pointed in the right direction."

Lion Enterprises submitted documentation to the DEP in late January showing that the violations had been cleared. However, subsequent inspections showed additional violations.

Tarbell said the building is slated to be sold at sheriff's sale.

Owners of Lion Enterprise must return the permit within seven days. They must transfer the remaining waste tires and processed tires to another facility within 30 days and provide documentation to the department within 35 days.

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Two Westmoreland Steve & Barry's closing

Steve & Barry's will remain open at Century III Mall and two other local retail complexes, but the clothing store chain will shut down two Westmoreland County locations.

The Port Washington, N.Y.-based company said today it will close stores at the Hillcrest Shopping Center in Lower Burrell and Westmoreland Mall in Greensburg.

A store at Morgantown Mall in West Virginia also is closing.

Steve & Barry's recently was purchased out of bankruptcy by an affiliate of investment firms Bay Harbour Management and York Capital Management. The new owners are slashing the list of stores to about 170, from 276 before the bankruptcy.

Along with Century III Mall in West Mifflin, where it occupies an anchor first-floor space, Steve & Barry's also will stick around at Beaver Valley Mall in Monaca and Norwin Hills Shopping Center in Irwin.

Closing sales at the stores being eliminated will run for a limited time, company spokeswoman Rachel Brenner said.

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Skilled tradesmen in short supply

Ian Gadson took the traditional path for a high school graduate to succeed in today's economy: He enrolled in college.

But the traditional path to success just wasn't working out for the Peabody High School graduate. "I went two years to Penn State, taking prerequisites for engineering," said Gadson, now 30. "But I wanted to make money."

Gadson quit college and was working for the U.S. Postal Service when he began noticing numerous brochures that would eventually change his career path.

"I kept coming across information about union jobs," Gadson said. "I got my hands on a pamphlet and called every phone number on it. I put in my name and interviewed with the asbestos workers, the laborers. Then I interviewed with the heavy and highway carpenters and they really wanted me."

Gadson in 2003 entered the carpenter's four-year apprenticeship program, which combines classroom with paid, on-the-job training. Now a member of Local 2274 of the Heavy Highway and Railroad Carpenters Union, the East Hills resident began working in November on the Port Authority of Allegheny County's North Shore Connector project, as a concrete form-work carpenter employed by North Shore Constructors.

"The apprenticeship program is the best thing that's ever happened to me," Gadson said.

For many U.S. businesses, skilled tradesmen like Gadson are an extremely rare commodity. A 2007 survey of 94 senior manufacturing executives found that the ongoing skilled-labor shortage will cost manufacturers alone on average $50 million each -- $4.7 billion total.

A survey by Raleigh, N.C.-based construction industry consulting firm FMI Corp. estimated that this year there were 6 million more heavy/highway construction jobs than employees in the industry, with the number of vacant positions projected to exceed 10 million by 2012.

"The work force question is a chronic problem," said David Taylor, executive director of the trade group Pennsylvania Manufacturers Association. "I've heard horror stories from members not being able to find applicants who can pass a drug test and who will show up on time."

A big problem in finding enough skilled tradesmen is the stigma attached to a "blue collar" job, experts said. "A lot boils down to Mom and Dad not wanting junior to take a job in manufacturing," said Lee Taddonio, president of SMC Business Councils, the small business trade group representing some 5,000 small businesses primarily in Western Pennsylvania. "We've done TV and radio advertising, held job fairs, trying to get people."

Rich Barcaskey, executive director of the Constructors Association of Western Pennsylvania, said his organization sponsors four apprenticeship programs, for carpenters, laborers, heavy equipment operators and cement masons. Between 100 and 200 new apprentices enter the program annually.

"In our apprenticeship programs, the average age is in the 30s," Barcaskey said. "We're seeing more people looking at a skilled-trade career due to the high cost of college, with a lot of people coming after finishing a year or two of college."

The Greater Pennsylvania Regional Council of Carpenters has outgrown its existing Neville Island training center, and last Friday broke ground for a new, $13 million center adjacent to the council's Collier headquarters.

"We've outgrown what was the old Neville School, which we've occupied since 1992," said Ray Vogel, joint apprenticeship training director. "Right now, we have 1,100 apprentices in the program, and we do have women apprentices."

Gadson admits he's an unpaid cheerleader for the heavy highway apprenticeship he believes was the best career path for him. "I've help four of my friends get into the carpenters' union," he said. "I'm proud of what I do."

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Lack of loans for tuition puts students in bind

Anxiety about paying for school plagues University of Pittsburgh undergraduate Kate Kelley -- and she's far from the only one.

Like many students throughout the country, Kelley, 21, a senior majoring in biology and history of art from Beaver Falls, had to change her student loan lender earlier this summer.

Then, Kelley learned last week from a university employee that someone had canceled her financial aid offer. Kelley said Pitt officials couldn't say why, nor could they let her know when or if the problem was resolved. Kelley said they told her she'd have to check back in a week or so.

"It's been stressful, sure -- my next tuition bill is due on Sept. 17th," said Kelley, who plans to borrow tens of thousands of dollars more in coming years as she pursues her goal of becoming a medical doctor. "I'm super concerned about where the money's going to come from."

Problems this year in financial markets made it difficult for lenders to access money, and many stopped offering student loans. To free up money for college, Pennsylvania's congressional delegation, led by Rep. Paul Kanjorski, D-Luzerne County, helped to craft a bill that became law in May.

That legislation increased the amount that students can borrow from federal loan programs, and permitted lenders to sell their outstanding federal loans to the U.S. Department of Education to make additional loans, Kanjorski said.

But money remains scarce, say Kanjorski, other members of Congress and loan companies. Kanjorski has scheduled a Sept. 18 congressional hearing that will explore securing additional money.

"The school year is beginning," Kanjorski said. "We have waited for the private sector and financial regulators to solve these problems. We can wait no longer."

Those like Dan Thibeault, president of Graduate Leverage, a loan company based in Waltham, Mass., hope the government's solution includes actual financial support and tax incentives.

"The bill Congress passed was about ensuring access, and will help on the federal side," Thibeault said, referring to loans guaranteed by the federal government. But the real issue is what Thibeault said would be a between $5 billion and $6 billion shortfall this academic year in the demand for loans made by private companies like his.

"The hope is that the financial markets will mend themselves," Thibeault said. "But that's not a good thing to bet on."

Doing so could force students to make "real tough decisions" such as canceling courses or taking semesters off if they can't find enough money to pay for school, Thibeault said.

Sammie Schaefer, 19, a Pitt sophomore from Brighton Heights studying bioengineering, almost dropped out last year because she had trouble gathering enough money to pay tuition bills. Schaefer still doesn't know if she'll find what she needs for this academic year.

"I worked two jobs last year and had to ask my grandmother for $5,000 because I was desperate," said Schaefer, who said her grade point average was 2.0 because of constant money worries. "I'm thinking about bartending this year. Money doesn't make you happy, but you're a lot less stressed out if you can pay your bills."

For in-state undergraduates, tuition at Pitt -- a public university -- ranges from about $13,000 to $16,000 a year. That doesn't include living expenses.

Uncertainty continues whether the student-loan situation will improve by the 2009-10 academic year. So far, 132 lenders have left the Federal Family Education Loan Program and 30 lenders have stopped loaning private student loans for the current academic year, said Mark Kantrowitz, publisher of FinAid.org and a nationally known financial-aid expert based in Cranberry.

Kantrowitz said the Kanjorski hearing could help lenders obtain more money to make loans. And he believes the capital markets will recover within a few months.

"Otherwise, there needs to be another source of capital," Kantrowitz said.

In the meantime, financial aid officials at area schools like Seton Hill University in Greensburg and Robert Morris University in Moon have stepped up counseling and communication with students and parents.

"We're keeping current on what all the different lenders are doing," said Maryann Dudas, director of financial aid at Seton Hill. "We can't make decisions for families, but we can guide them.

"Right now, we don't know what lenders are going to stay or for how long. That's creating great frustration and terrific concern."

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Mortgage, credit crunch fills apartment complexes to capacity

Many Pittsburgh landlords have hung out "no vacancy" signs at their apartment buildings.

For the first time in many years, they have 100 percent occupancy.

The high occupancy is a direct result of the mortgage crisis and tighter credit standards that has eliminated many buyers from purchasing homes, landlords say. Some cite the usual influx of recent college graduates and transfers of out-of-towners with new jobs to Pittsburgh.

One of the fully leased complexes is the 297-unit Cork Factory in the Strip District.

"Occupancy has been strong at the Cork Factory the past year, hovering in the high-90 percent range, but this is the first time we reached 100 percent," said Debbie Roberts, general manager.

She has initiated a waiting list that now exceeds 20.

Jeremy and Allison Novotney are among the reasons for the full house.

They were among the last tenants to lease an apartment at the Strip District complex, where occupancy reached 100 percent about four weeks ago.

The couple relocated to Pittsburgh from Hawaii after Jeremy obtained a position with Eaton Corp.

"We researched Pittsburgh prior to moving here, and liked the Strip District, and decided it was more economical to rent than to buy, so we settled on renting at the Cork Factory," said Allison, 27.

"We'll probably consider purchasing a home in about three years," she said.

Full occupancy reigns at many other apartment complexes in Pittsburgh and surrounding communities.

Some are the 267-unit Heinz Lofts on the North Shore; the 24 apartment buildings in the city operated by Mozart Management that totals about 1,000 units; many of the buildings owned or managed by Lincoln Property Co. that total 2,700 units; the 50 units owned by Steve Worobe of Middleton Realty in Mt. Lebanon and in the Edgewood/Swissvale area; and the 800 units in the city managed by Meyers Management.

"We were amazed that we obtained the full occupancy because it came at a time we instituted the highest rental increase," said Don Gross of Meyers Management. The last unit was leased three weeks ago and "now we are turning people away because we have no vacancies."

A lot of the rentals are to young professionals and college students in and around the Oakland area, he said.

Worobe, president of the Apartment Association of Metropolitan Pittsburgh, said his members are reporting higher occupancies this summer and that there seems to be more renters out there because of the tightened mortgage criteria. His 50 units, spread between Mt. Lebanon and the Edgewood-Swissvale communities, are all leased with the last lease signed Aug. 14 and the tenant moving in on Aug. 20.

According to a National Association of Realtors, the apartment vacancy rate for the Pittsburgh-area market was expected to be 3 percent in the 2008 second quarter. That ties Pittsburgh with Newark, N.J., and Salt Lake City, Utah, for the lowest vacancy rate in the nation, said spokesman Walter Molony. The nation's average occupancy rate for the same time frame was expected to be 5.4 percent, Molony said.

Richard Moody, chief economist and director of research for Mission Residential LLC in Austin, Texas, said Pittsburgh avoided the home building excesses seen in many markets in recent years and is feeling the impact of tighter mortgage lending standards and the credit market turmoil. Both support demand for rental housing. Another trend is that demand for housing close to urban downtowns or close to transportation hubs has been rising rapidly. As a result, properties in such areas have lower vacancy rates.

A report by Torto Wheaton Research of Boston placed the Pittsburgh region's apartment occupancy level at 97.1 percent in 2007, and forecast an increase to 97.5 percent this year. Average rental prices per apartment unit has been increasing in recent years, rising from $771.89 in 2000 to $820.05 last year, the report said. Torto Wheaton is a unit of CB Richard Ellis.

The high occupancy levels in Pittsburgh plus the stability of its apartment rental market has brought many out-of-town investors here looking for apartments buildings to buy as investments, said Cynthia Kamin, senior vice president, CB Richard Ellis/Pittsburgh.

"With our occupancy level at 98 percent, it's no wonder that 70 percent of apartment building sales here are to out-of-town investors," she said.

Frank Bercelli, general manager of Amore Management Co., which began marketing the Heinz Lofts in 2005, said fully occupancy occurred several months ago. Many of the new tenants are those who were unable to qualify for a mortgage to buy a house, and professionals who were brought into the region by companies to undergo two or three years of training.

The Heinz Lofts are not the only apartments experiencing full or high occupancy, Bercelli said. "Of the 2,400 apartment units we own or manage, the average occupancy rate is about 93 percent." All but 300 units are in Allegheny County, with the remainder in Beaver County or out of state.

Mozart enjoys 100 percent occupancy in its buildings because of its unique location, said Frank (Skip) Schroeder, general manager.

"Our valued-priced buildings are in the areas that include the medical centers and universities," Schroeder said. "In February, we may list 400 or 450 potential vacancies ... but by Aug. 1, they are usually leased," he said.

Arbors Management Inc. of Monroeville handles affordable apartments along with rentals in private homes where owners have one, two or three units available.

"Of the 30 apartments with 2,600 units we manage, 27 are fully leased," said Patty Recklitis, president and director of Arbors' affordable housing division.

Arbors owns or manages 2,500 single-family houses, duplexes, three-unit and four-unit properties that are owned by investors. Of these, about 90 percent are leased, said Thomas Wagner, vice president, who handles that portion of the business.

Lou Goodwin, property manager at Brandywine Agency in North Versailles, said about two of its apartments in Westmoreland County, the 36-unit Markvue Manor is fully leased, while the 51-unit Kensington Arms in New Kensington, has only one unit left to lease.

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