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Survival of Delphi's Lockport complex, Huntley plant approval are good news But auto buyouts, closing of Motorola in Elma may change local economic picture

The top 10 local business stories for 2006 have a decidedly positive tone. Not all the financial news was good this year -- far from it -- but looking back, several things went well for the region:

1. The saving of the Delphi Thermal Systems plant in Lockport was selected as the top local business story by The Buffalo News' business reporters and editors. With the company operating in bankruptcy, and word that 21 of its 29 U.S. plants would be shuttered, nerves around the giant Niagara County factory got a little frayed early last year. A cheer of relief welcomed the March announcement that the plant would survive.

The plant employs 3,360 people and is the region's largest manufacturing employer, in addition to being a customer for many local suppliers. Losing the plant would have been a crushing blow to a region suffering through the transition to a service-based economy.

The plant survived in large part due to the two-tiered wage scale that union members endorsed. Though most of the jobs for new hires now pay about $14 an hour, half of what they used to, the plant and all it supports are secure for the time being.

How long that security will last is an open question.

The rest of the top 10 stories are:

2. The Huntley Power Station on the Niagara River in the Town of Tonawanda was given "conditional" approval in late December as the site for a $1.5 billion clean-coal power plant. Expectations are that the plant will be given final approval when the project's costs are trimmed.

The Huntley site was picked over four others in the state, including a site in Niagara County.

Why is a power plant such a big deal? Building the new plant will employ about 1,000 construction workers for about four years, and when it is completed it will create 100 full-time jobs.

Also, cleaning up the Huntley plant, a grimy dinosaur that has been tagged as one of the nation's dirtiest, will be a tremendous benefit to the environment and be a part of the region's emerging clean-power economy. Other projects include a wind farm on the former Bethlehem Steel site in Lackawanna and plans for an ethanol plant using some of Buffalo's abandoned grain elevators. These join the granddaddy of all clean power projects, Niagara Falls.

In addition, the University at Buffalo is hoping to start a Clean Coal Center of Excellence to advance the science of using the plentiful energy source.

3. After 15 years of operating the homegrown Tops Friendly Markets, Dutch parent company Royal Ahold put the local stores up for sale in November. No buyer has been selected.

In New York and Pennsylvania, 73 stores operate under the Tops banner, including five owned by franchisees, and four have been run under the related Martin's Super Food Store name. The company has already announced plans to sell its Tops stores in Ohio, and is selling U.S. Foodservice, a Maryland-based food distributor.

Tops, started in 1961, has undergone sweeping changes in recent years. It sold off its Wilson Farms convenience store chain, pulled out of eastern New York State and Adirondacks markets and shifted many of its back-office operations from Amherst to Carlisle, Pa., home of the Giant chain, which Ahold also owns.

Tops is the largest supermarket chain in the region and employs more than 10,000 people, but is facing growing competition from Rochester-based Wegmans and the emergence of Wal-Mart as a grocery store power and other discounters like Aldi's and Sav-A-Lot.

4. Time Warner took over the local Adelphia cable operations in August, after splitting Adelphia's subscriber base with Comcast in a $17 billion deal that ended the run of the company founded in Coudersport, Pa., by John Rigas. The switch also ended one of the strangest corporate sagas in Western New York history, the rise and fall of the Rigas family.

Time Warner now serves about 322,000 homes from Niagara Falls to Olean. With the new owner comes its contractual squabbles with cable channel providers, including the NFL Network, which is not being shown locally.

Meanwhile the bankruptcy proceedings of Adelphia in New York were moving toward completion early this year.

5. New Era Cap Co., the internationally known baseball hat maker, moved into glamorous new headquarters in the refurbished former Federal Reserve Bank building on Delaware Avenue in late November. The company joins HealthNow in locating downtown.

New Era, with its ties to popular culture and Major League Baseball, is seen as a boost to the city's business climate. In addition, workers moving in from the company's Derby location spoke about the excitement of being near the restaurants and clubs of the Chippewa Avenue entertainment district.

6. Buyouts throughout the domestic auto industry helped change the faces and the culture at several auto plants in the region.

General Motors and Delphi started the buyouts in March when they offered members of the United Auto Workers from $35,000 and $140,000 to retire and forego all benefits except accrued pensions. Across GM, 34,400 workers took the buyouts, including 639 at the engine plant in Tonawanda. At the Delphi plant in Lockport, 1,333 workers accepted the buyouts, and 900 new people were hired. At American Axle's three area plants, 666 workers took buyouts. At the Ford Stamping plant in Woodlawn, about 400 people decided to retire and take the money.

Many of the outgoing workers are being replaced with people earning about half of the previous wages. It's all part of a restructuring companies say is needed to save the domestic auto industry.

7. The lengths to which local communities will go to attract and retain businesses were on display when the Amherst Industrial Development Agency granted HSBC Bank USA $79 million in tax breaks to expand a data center -- about $6.6 million for each of the 12 jobs to be created. The bank said beefing up the Amherst data center is vital for the bank's plans to build a new data center in Niagara County. Proponents said the center will generate many spin-off jobs in other companies. Others questioned the cost.

8. The battle over who will provide Internet, telephone and television service to homes in the region started to get serious this year as Verizon launched its program to bring fiber optic service to homes in the Southtowns. The expensive and time-consuming process of burying fiber optic cables through each neighborhood could usher in a new era of choice and competition.

However, some people have balked at the service when they learn that their traditional copper telephone wires will come down for good once the fiber is connected to their homes.

9. Western New York shoppers were giddy at the arrival of New York fashion merchandizing icon Macy's, which took over four Kaufmann's stores at area malls in September. Federated Department Stores, parent company of Macy's, bought May Co., owner of Kaufmann's and other stores. The result was a farewell to the beloved Kaufmann's with its terrific deals and an eager welcome to the glamour of the Macy's name. Shoppers at the Walden Galleria, McKinley Mall, Boulevard Mall and Eastern Hills Mall flocked to the new stores.

Meanwhile, Federated sold Lord & Taylor to NRDC Equity Partners. That company said it planed to keep the Galleria store open.

10. On a distinctly negative note, Continental AG announced in November that it was closing the 300-job former Motorola plant in Elma in the middle of 2007. The work would be transferred to plants in Asia.

The closing brought back the dread of the late 1980s, when area plants closed by the score. It also brought into sharp focus the changing local economic landscape. Specialized manufacturers that use highly skilled workers have found ways to thrive, but many larger companies owned by out-of-town corporations continue to close local operations and cast their lots with the cheaper foreign labor forces.

Continental, a German company most known for its tires, acquired the plant from Motorola Inc. in 2006 in a broader $1 billion deal for Motorola's automotive electronics business. The plant makes auto electronics, such as sensors and relays, for vehicle makers and component manufacturers.

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