LIA Job, Tech Plans Under Fire

Long Island Business News
By: Peter Mantius
July 20, 2001

COMMACK - Two controversial new initiatives by the Long Island Association have touched off an increasingly emotional backlash in the high-tech and professional staffing industries on Long Island.

The general counsel of Long Island's leading high-tech trade group this week called for Matthew T. Crosson, the LIA's president, to resign on the grounds that his moves are disrupting tech development on the Island.

And several staffing executives said a large group of staffing companies would quit the LIA if the organization that oper-ates as the Island's Chamber of Commerce doesn't cancel its plan to open a for-profit staffing division that would compete with them.

"You can be sure they'll lose 33 staffing companies when they start it," said Merrill Banks, the president of Lloyd Staffing. "How could we possibly stay members? We're going to finance a competitor with our LIA dues?"

Richard Lippe, counsel to the Long Island Software and Technology Network, was sharply critical of the LIA's bid to wrest government grant money away from the Long Island Forum for Technology, or LIFT, which has used the funding to provide technical assistance to small firms for several years running.

"Money and power are behind this, certainly not the interests of Long Island," he said. Lippe said he was speaking personally, not as a representative of LISTnet, his Mineola law firm Meltzer, Lippe, Goldstein & Schlissel, or the New York State Office of Science, Technology and Academic Research. Lippe is a board member of NYSTAR, which will decide whether to award the grant money to LIFT or the LIA.

Crosson said in an interview that Lippe is the attorney for an LIA "competitor" and his comments "must be taken in that context."

The LIA president also launched a media campaign this week to defend his group's bid to win the grant money. He authored an article for the opinion page of Newsday and then paid to have virtually identical language repeated in an advertisement in this week's Long Island Business News.

Crosson argued that the LIA is better equipped than LIFT to help the Island's tech industry develop strategic goals, which he characterized as a new NYSTAR priority for the program.

Lippe disagreed, saying that providing services to small tech companies - LIFT's strong suit - continues to be the program's primary goal.

But Crosson said NYSTAR's shift in emphasis toward strategic concerns effectively forced the LIA to enter the competition. Otherwise, he said, competing organizations would be attempting to set strategic priorities for tech development on Long Island.

Peter Goldsmith, president of LISTnet, which recently merged with LIFT, said the LIA isn't equipped to perform the job it is attempting to win.

"The LIA shouldn't take on things they don't know about," Goldsmith said. "This is real hands-on work. The strategic part of the (request for proposal) is one little part. He's blown it up. He puts half truths into print."

Goldsmith declined to comment on Lippe's call for Crosson's resignation. "Matt can still turn around and see the truth of what's happening. He can still save the whole thing" by withdrawing from competition for the grant money, Goldsmith said.

Meanwhile, the staffing industry executives were also pressing Crosson and the LIA to reverse course.

The association announced last month that it was creating a new for-profit subsidiary, LIA Staffing Inc., that would help LIA members recruit workers. Crosson said he expected the unit to generate annual revenues of between $800,000 and $900,000.

The division's manager, Scott Passeser, had been head of LIJobs.com, a subsidiary of Invision.com, an LIA member.

Joel Hamroff, president of the New York State Association of Temporary and Staffing Services, said Crosson had agreed to the industry's request to meet with him Wednesday.

"Our goal is to make Mr. Crosson change his position," Hamroff said.

Crosson said only two staffing companies have voiced objections.

"The majority of staffing firms (that are members of the LIA) have already told us they like the idea," he said, adding that he wrote a letter to staffing companies in the association that explained that his organization would be serving as a clearinghouse that funneled business to them.

"The majority of staffing businesses in our association recognize (the new division) has the potential of developing more business for them," Crosson said.

Crosson said the LIA's 49-member board, made up of some of the Island's most prominent business executives, voted on the decision to launch LIA Staffing.

However, Debbie Pond-Heide, an LIA board member who is president of staffing giant Adecco North American, was not present when the board discussed the matter, according to her staff. Crosson said he doesn't discuss what happens at LIA board meetings and said minutes of the meetings are not public.

Banks, of Lloyd Staffing, questioned whether the LIA board was sufficiently engaged in overseeing Crosson and the association.

Lippe agreed, describing the board as "unwieldy and not plugged into what Matt's doing."

Crosson said the board had voted "unanimously" to seek the tech grant funding, and one LIA board member, who asked not to be identified, said he and other board members were very comfortable with Crosson's initiatives.

He described the complaints about the new initiatives as "a struggle for turf." He said that in the long run, "they're not even a blip on the radar screen."