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January 16, 2002 - Image 3

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The Michigan Daily, 2002-01-16

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The Michigan Daily - Wednesday, January 16, 2002 - 3

'U' Penn graduate
students seek
right to unionize
PHILADELPHIA - Hearings over
the right of University of Pennsylvania
graduate students to unionize will
resume today, after a preliminary hear-
ing was held on Friday.
Friday's preliminary discussions,
which were held at the downtown
Philadelphia office of the National
*Labor Relations Board, were intended
to initiate the process of determining
whether or not the students have the
right to elect a body that would repre-
sent them collectively in contract nego-
tiations with the administration.
However, since the lawyers repre-
senting the administration did not have
all the documents requested in the sub-
poena delivered in advance of Friday's
hearing, and their witnesses were not
prepared to take the stand, the substan-
tive start of the hearing is tentatively set
for today
Ed Webb, spokesman for Graduate
Employees Together-University of
Pennsylvania, said he believes the uni-
versity may be delaying the hearings as
a method of putting off the election
process temporarily. However, Webb
said he hopes the delay is a result of the
holiday recess and not a stall tactic.
Webb said GET-UP remains focused
0on proceeding through the hearings as
quickly as possible to ensure elections
will be able to take place before the end
of the semester.
"More people can be involved, and it
will be more democratic," Webb said.
Texas A&M to
consider restoring
*bonfire tradition
planning phase is finished and students
are now being asked to decide whether
a drastically redesigned Texas A&M
University Bonfire should burn next
Students will be able to participate in
a survey this week intended to gauge
support for Bonfire under the strict new
safety parameters. Student support will
be a decisive factor in Texas A&M
President Ray Bowen's determination
on whether to let Bonfire continue, said
Bonfire 2002 Steering Committee facil-
itator Bryan Cole.
"He has always said that strong stu-
dent support is a must for this project to
move forward," Cole said. "And Bowen
will consider the survey results before
making a decision:'
Bonfire 2002 is expected to cost as
Wmuch as $2 million, and Bowen has
said the university may have to scrap
the Bonfire unless costs can be reduced.
However, Cole said much of the cost
comes from one-time expenses.
Student Body President Schuyler
Houser said that without an over-
whelming response from students in
support of Bonfire, Bowen may decide
that student interest is insufficient for
the project to continue.
"It is so important that students really
*take this seriously," Houser said.
U. Utah to serve
alcoholic drinks
for Olympic events
SALT LAKE CITY - Among the
many Olympic changes - parking dis-
ruptions, giant cauldrons and building

size banners - one comes in liquid
Alcohol will be served in the Union
for "the first and last time," said Stayner
Landward, dean of students.
"I believe the attorney general said
that under this special circumstance,
alcohol can be served, even though this
is an alcohol-free campus," Landward
Because of this ruling, only certain
entities can serve alcohol in the Union.
"Areas will be cordoned off or par-
ties will be held in private rooms," said
Whit Hollis, Union director. "Parties
serving alcohol will be Olympic related
and separated from the U community.
This isn't a blanket policy. If ASUU
wants to host a party with alcohol,
that's not going to happen."
The point of serving alcohol is basi-
cally for the sake of international rela-
"We're trying to be good neighbors
good Olympic hosts," Hollis said.
- Compiled from UWIRE reports by
Daily Staff Reporter Maria Sprow

Canton senator

By Chistopher Johnson
Daily Staff Reporter
Referring to his success in appealing to
Democratic voters and his ambition to continue
Secretary of State Candice Miller's technologi-
cal renovation of her office, Sen. Loren Bennett
yesterday made his case for becoming Michi-
gan's next secretary of state.
As proof of his ability to transcend party
lines, Bennett (R-Canton) cited his first election
to the state Senate despite a Democratic base
vote of 56.3 percent.
He also commended Miller's modernization
of her department during her tenure, which he
said he plans to maintain by digitizing driver
information in Michigan. The new system would
decrease the storage space needed for records,
enhance the speed with which employees can
access them and allow employees involved with
paperwork to work at the service branches.
"(My office) will be an extension of what
(Miller) has been doing;" the senator said.
Bennett stressed that he would not have an

extended budget during his tenure.Z
more services he said he would
improve the efficiency of his office.
Bennett also explained that hisc
would balance the party ticket if R
select Lt. Gov. Dick Posthumus as th
date for governor. He said Posthun
have no trouble securing the solid R
Kent County in which the lieutenani
lives, but would need help carrying le
vative areas - a task Bennett's c
could help accomplish.
Bennett indicated any assistance th
mus receives will benefit him becaus
ney General Jennifer Granholm
Democratic nomination, she will be tl
est candidate that Dick will be facing.
In the question-and-answer sessio
lowed Bennett's speech to about 25 m
the University's College Republicans,
ted he would seek to reform current
laws in the Legislature, despite having
such provisions as a senator. He saidt
has had few problems with the regul-

To provide the more rapidly changing House has encoun-
I need to tered several more.
One of the problems with term limits, Ben-
candidacy nett said, is that members of the state House can
epublicans serve only six years, thereby diminishing the
heir candi- experience of officeholders.
aus would Bennett's speech encouraged some students
epublican in attendance to support him in his endeavor for
t governor the candidacy.
ss conser- "I think that he is the kind of candidate who has
andidacy proven his record," said LSA senior Julie Marcal,
president of the College Republicans. "Clearly in
iat Posthu- a district where Democrats are in the majority he's
e if Attor- been able to reach across party lines, and people
wins the like him for the candidate that he is, not because
he "tough- he's a Democrat or a Republican."
Engineering freshman Tucker Berckmann
n that fol- left the meeting with mixed feelings about Ben-
iembers of nett. He was impressed with some of issues the
he admit- senator discussed, but "I still have questions
term limit about his goals," he said.
g voted for Competing for the Republican nomination
the Senate are former Kent County Clerk Terri Land and
ations, but Calhoun County Clerk Ann Norlander.

to students

Michigan Secretary of State hopeful Sen. Loren Bennett
speaks to the University's College Republicans last night in
the Michigan League.

Blues brother

Fuel cells need to
be adapted to use
in autoindustry

DETROIT (AP) - Fuel cell tech-
nology is "the holy grail ... the break-
through" if it works, GM president
and CEO Rick Wagoner told an
industry conference.
But even with the partnership
announced last week between the fed-
eral government and automakers to
develop them, it could be a long time
before drivers are able to trade in gas
guzzlers for hydrogen breathers.
Fuel cells, first used by NASA in
the space program, create electricity
through a chemical reaction between
hydrogen and oxygen. If pure hydro-
gen is used as a fuel, the only emis-
sion is water vapor.
However, hydrogen is an extremely
flammable gas, requiring heavy tanks
that can withstand collisions. The
industry is working to develop lighter

tanks that also are crash-worthy.
The alternative to hydrogen is
more easily available fuels, such as
gasoline, methanol, propane or nat-
ural gas. But using those fuels
requirs an extra piece of equipment
called a reformer to extract hydrogen
from them, adding heat, cost and
weight. The vehicles produce some
polluting emissions, although to a
lesser extent than internal combus-
tion engines.
The other major challenge to what
automakers call "a hydrogen society"
is a lack of a refueling infrastructure,
or hydrogen filling stations.
One of the goals of the partnership
announced at the North American
International Auto Show last week,
called Freedom CAR, is to develop
such an infrastructure.

Jacobson's files
for bankruptcy, 5
stores to close

University employee Tom Goss plays his harmonica near the Diag yesterday afternoon. His band "Broke'n Blue" will be
appearing at the Blind Pig on Feb. 5.
Kmart stock falls as shareholders
fear com pan y wllgoakrupt

DETROIT (AP) - Stock of Kmart
Corp. plunged close to 14 percent yes-
terday, fueled by concerns over a possi-
ble bankruptcy filing amid a series of
downgrades by analysts and investment
rating agencies.
Standard & Poor's, one of the nation's
largest debt rating agencies, announced
that it will take the retailer off its 500
index after the close of trading today.
David Blitzer, the managing director
of quantitative services for S&P, said
Kmart was removed "because of its low
stock price and the company's financial
Shortly after the market opened yes-
terday, the stock dropped to a new 52-
week low of $2.29 from Monday's
closing price of $2.84 but rebounded to
$2.45 at the close of yesterday's trading.
Kmart spokesman Jack Ferry con-
firmed that the company's board of
directors was holding a previously
scheduled meeting yesterday and also
held committee meetings Monday.
Ferry declined to say what the board
was discussing at the meetings, but
sources close to the company said the
board would be discussing its financial
options, including a bankruptcy filing.

Richard Church, an analyst at
Salomon Smith Barney, said yesterday
that it was lowering its risk rating on the
Troy-based retailer from "high" to
"speculative," given the uncertainties
surrounding the company's situation and
"While ... we believe that Kmart has
many options it can explore in order to
meet its liquidity over the coming 12 to
18 months, other less quantifiable fac-
tors such as lack of vendor support have
elevated Kmart's risk profile consider-
ably more than we thought to be the
case as recently as yesterday," Church
wrote in a research report.
S&P also lowered the retailer's credit
rating on 14 Kmart-related credit lease
transactions and placed it on Credit-
Watch with negative implications.
S&P on Monday lowered Kmart's
corporate credit rating from a BB to a
B- and its preferred stock rating drop
from B to a CCC-. It also said the retail-
er was on its list of companies to watch
with negative implications.
It said those actions were based on
heightened concerns about Kmart's loss
of financial flexibility in recent weeks.
. The illustrious retailer has about

275,000 employees and 2,105 stores in
all 50 states, Puerto Rico, U.S. Virgin
Islands and Guam. It is the nation's
third-largest discount retailer after Wal-
Mart Stores Inc. and Target Corp.
Howard Nemiroff, a professor of
finance at Long Island University, said
unless Kmart can secure additional
financing in the next few days, a Chap-
ter 11 bankruptcy filing within the week
is likely.
Nemiroff said, however, that the com-
pany's larger suppliers could help bail
out Kmart by extending credit to the
"It's generally in the company's best
interest to be flexible, because they want
to keep their sales up," he said. "But
they're not going to keep doing that if
they think they're throwing their money
down a pit."
Adam Winters, senior vice president
of Merchants Factors Corp., which pro-
vides loans to small and midsize apparel
companies, said that Kmart has been
slower in paying its vendors since
November, though not "terribly late."
He added that instead of paying them 10
to 15 days late, Kmart is now paying
them 20 days late.

DETROIT (AP) - Specialty retail-
er Jacobson Stores Inc. announced
yesterday it had filed for Chapter 11
bankruptcy protection and was closing
five of its 23 stores.
Calling the move "a new beginning"
for the struggling company, Jacobson
spokesman Frederick Marx said there
will be "no interruption of store opera-
tions for the 18 remaining stores."
"Our intent is to move forward with
our best stores, and the court-approved
reorganization does allow us to be
competitive," Marx said.
With a bankruptcy judge's approval,
the retailer plans to close underper-
forming stores in Columbus and Tole-
do, Ohio, and Clearwater, Osprey and
Tampa, Fla. About 520 jobs would be
The company also operates Jacob-
son's stores in Michigan, Indiana, Ken-
tucky and Kansas. The planned
closures would eliminate the retailer's
Ohio presence and leave eight stores in
Jacobson also announced an agree-
ment with Boston-based Fleet Retail
Finance Inc. and Back Bay Capital

Funding LLC for $130 million to
finance the company's reorganization.
"They've solidified their bank rela-
tionships so that they can ensure an
influx of inventory," said Gary
Giumetti, president of McTevia &
Associates, a management and finan-
cial consulting firm in Eastpointe.
"They can't sell from an empty shelf,
and that's what they were facing."
In December, Jacobson reported a
third-quarter net loss of $13.9 million,
or $2.40 per share. In a filing with the
U.S. Securities and Exchange Com-
mission, the company said it would
default on a $150 million line of credit
unless it negotiated new deals with its
The company had failed to uphold
several loan covenants and announced
that it would not make interest and
other payments due on some of its
"Jacobson's is somewhat of an
anomaly," Giumetti said. "They're a
23-store chain with operations in six
different states. They just did not have
the critical mass to able to keep up
with the major stores."

Due to incorrect information provided to the Daily, the time of tonight's symposium on the Rabih Haddad case fea-
turing U.S. Rep. Lynn Rivers was misstated in an article on page 1 of yesterday's Daily. The event begins at 8 p.m. in the
Michigan Union Ballroom.

What's happening in Ann Arbor today
ENTS Support Group; Spon- and purpose before SERVICES
sored by The actively conducting a job Campus Information
"A Discussion of Ethiopi- Alzheimer's Association, search, Sponsored by the Centers, 764-INFO,
an Jewry"; Sponsored by 6:00 - 8:00 p.m., Center for the Education info@umich.edu, or
Unila7 7.n m Alzheimer's Association of Women, 12:00 p.m.. . wewumih.1edu/~--info

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