The following oral history transcript is digitally recorded interview with Chris Gulotta. The interview took place on October 22, 2007 at the Cumberland County Redevelopment Authority in Carlisle, Pennsylvania. The interview was conducted by Molly Osborn, an American Studies major at Dickinson College. The purpose of the interview is focused on the recent emergence of female entrepreneurs in Carlisle and the Authority’s role in the process.
MOLLY OSBORN: So Mr. Gulotta, what is your role with Carlisle Redevelopment Authority?
CHRIS GULOTTA: Well it’s actually the Cumberland County Redevelopment Authority. We’re a county wide authority. I’m the executive director. I’ve been the executive director for 27 years.
MOLLY OSBORN: And how did you become involved?
CHRIS GULOTTA: Well I went to graduate school for Urban and Regional Planning at Penn State Harrisburg after I graduated from Dickinson in 1976. I also went to law school and graduated from the law school. Then coming out of school, this position became available. I had a lot of interest in community development and urban development, and with my background in planning, this was a natural fit.
MOLLY OSBORN: Where are you from originally?
CHRIS GULOTTA: Phoenixville, Pennsylvania, outside of Philadelphia.
MOLLY OSBORN: Okay. From your time at Dickinson, have you seen the business change? Including the visibility of women in the businesses.
CHRIS GULOTTA: Well I started at Dickinson in 1972. As I said, I graduated in 1976. The evolution and the transformation of the downtown area have been significant in that time. Back in 1972, you had traditional downtown retailers. There were still some downtown department stores in the downtown, and hardware stores, and shoe stores, and a toy store and not so many restaurants, interestingly enough. And the vast majority of those businesses were not women owned; they had been operated many years by families and specifically, a male was usually running the business. But businesses were handed down from generation to generation; the hand down was generally to a male member of the family, not a female member.
MOLLY OSBORN: Do you have an idea why that has changed now? Is it because women are more accepted socially to be businesses owners, or is it just that some of the men have stepped into different areas?
CHRIS GULOTTA: I don’t know. I may not be the best person to answer that. I do know that women business enterprises in 2007 are very business savvy, including all of the women businesses that I have worked with, and we have provided financing to at this point. They all understand business; they know how to do a business plan. They know how to execute the business plan. In order to make money in a downtown setting, these days, you really need to have business plan and you need to be very disciplined about executing it. In part, because essentially, the competition is so severe, and I think candidly, a lot of the older businesses that had been in the downtown had existed many years based on reputation. Didn’t have to worry so much about out-competing the other, they had established customers. They may have gotten a little bit lazy and I think women businesses have come in and filled that void. As we saw some of these, what I call “old economy” businesses, leaving the downtown, we have seen a lot of what I call “new economy” retail businesses coming into the downtown. They seem to be, particularly the ones run by women, successful I think, because they have substantial business savvy.
MOLLY OSBORN: What was your involvement with the creation of Bedford Antiques around 2000?
CHRIS GULOTTA: Actually, Mary Roell had, as you probably know, she had run an antique co-op called Albion Point out at the old K-Mart, now where the Lowe’s is. And, she came to me several years ago, and wanted to essentially, to operate something like that in the downtown. And originally she was looking at the old Woolworth building, which is now called Business Central. That building, the old Woolworth building was so deteriorated; I couldn’t afford to rent it to her. At that point, we owned that building and we couldn’t rent it to her for what she could pay. So I suggested to her that maybe we look at some other options, or maybe she suggested to me, we look at some other options, maybe it was mutual. But basically, she came back to me; I’m going to say six months, eight months later, with this other option which was the acquisition of the former dress company on Bedford Street. And, I like Mary, liked her concept, thought that the concept would add a lot of value to the downtown because antique co-ops and other communities, if they are well run, will attract a lot of foot traffic. And that foot traffic benefits other businesses in the downtown, like restaurants. As people come in, when they are done shopping at the antique co-op, they will invariably want to have lunch or dinner, and in the process, go by other shops.
So I like the idea for a lot of different reasons / it was reusing an existing historic structure, it was renovating a historic structure, it was creating a, kind of a destination business, if you will, because antique co-ops that are this big draw not just from the immediate market area, but from a regional market, within 50 to 75 miles. So it would draw people into the downtown that normally would not be there. And there would be substantial spin off foot traffic in the balance of the downtown. So, what I did, is help Mary put the financial pieces together – to make the deal financially viable.
MOLLY OSBORN: When I spoke with her earlier, she mentioned a lot of grants and specific funding. Are there a lot of incentives for specifically women businesses?
CHRIS GULOTTA: No. I think that’s a fallacy. And I get that question a lot of times. There really are not programs specifically for women owned businesses. So all of the programs I used are what we call subordinate financing. These are all loans. None of them were grants. They were a loan from the state, $45, 000, a loan from a local industrial development corporation, $30,000, loan from the Borough Community Development Block Grant Program, that’s federal money, that’s $35,000, a loan from a group called Community First Fund, which is outside of Lancaster. They’re called a community development financial institution. They provided $51,000. She got a bank loan from Orrstown Bank in the amount of $203,000. Then she put in $20,000 of her own cash.
Those funding sources that I just went over would be available to a man, or a women, and the one common denominator is they are all below market rate. In other words, the interest rates are pretty favorable. I think probably the lowest was at 2%, some of these were 2-3% interest, and others may be a little bit higher. But, one of the reasons that we provide below market rate financing is because in a town like Carlisle, as opposed to a major city, as a general rule, rents are not as high. So you can’t earn as much income from rents on building here in Carlisle that you could earn in Philadelphia, or Chicago, or New York. And yet your costs of rehabilitating the property are pretty much the same as what it would be in the cities. So what we’re trying to do is reduce the rate – you don’t reduce the borrowing because they still have to borrow the same amount. But you try to make the borrowing cheaper. And the way you do that is trying to bring to the table a package of low interest rate loans.
MOLLY OSBORN: Do you think she would have been able to produce such a product, say in the 1970s, as easily as she did today?
CHRIS GULOTTA: You know that’s a good question. Not being around in the 1970’s, at least doing this, you know I don’t know. I think the answer to that is possibly yes, but I don’t know for sure. The only program that was around in the mid 70’s was the borough’s community development bloc grant program. But we really, up until the last ten years, we never used that money for economic development, or for business financing. We used it mainly for rehabilitating houses or creating home ownership opportunities. So while the money may have been there, she would have probably have had to go to HUD or a state agency. In other words, there was nobody in my position back in the 70s to help her put the package together. I think that’s maybe what’s different.
MOLLY OSBORN: What was the community’s response to the renovations of the historic building?
CHRIS GULOTTA: Well I think the response has been very positive because it has involved the rehabilitation of a historic building. I think people like the Bedford Antiques; they like going in there. They see stuff that reminds them of their childhood. And I mean, it’s a fun place to go. I enjoy going there myself. I think that a lot of people who are vendors there appreciate it. While the people there, I don’t think, make a lot of money for being vendors. That’s a way for them to kind of dabble in that with relatively low overhead. They pay 100 or 150 dollars a month and get to buy and sell stuff and hopefully they have fun doing it. So I think it’s been very well received. I think the key was that Mary had all of the contacts from the co-op that she ran, Albion Point, and she was able to exceed her projections. I don’t recall exactly what her business plan was, in terms of how quickly she would lease up, but she actually leased up faster than she thought she would. And that’s because she had stayed in touch with a lot of those vendors, so as soon as this project became a reality, she opened 50% full. That’s very unusual. Yes, I think it’s been very positively received.
MOLLY OSBORN: Now you mentioned that she, when she was at Albion Point, Lowe’s took over the area and created another business opportunity. Do you think that Wal-Mart and other big-boxes have created other businesses, or do you think they have been somewhat detrimental to the area?
CHRIS GULOTTA: I think it’s mixed. I really do. I used to think that Wal-Mart does not hurt a downtown, particularly the downtown that we had before Wal-Mart came in. Because our downtown before Wal-Mart came in had already lost a lot of these shops that carried the type of merchandise that Wal-Mart carried. In other words, we had no toy stores. We were down to one shoe store. We had virtually no clothing shops. What we had were restaurants, we had a couple of gift shops, a bookstore.
But the one story I tell is that you never know the full effect of a Wal-Mart. Let me give you an example: We did have a Christian bookstore that was downtown two years ago. I would have never imagined that Wal-Mart would have affected a Christian bookstore, but one of the stories that the owner shared with me is that Wal-Mart had sold bibles for less than half the cost that he carried them for. And at least he claimed, that he was hurt by Wal-Mart because people could buy bibles at Wal-Mart rather than his Christian bookstore. Now I think the story, in order to really tell the story there, probably what hurt him as much if not more, are internet sales of Sunday school materials. But the fact of the matter is Wal-Mart hurt him as well.
Having said that, there are positives to having a Wal-Mart come into an area. And the positive is that they attract other big-box retailers. And our case is pretty typical, usually you will not have Lowe’s, or Home Depot, or TJ Maxx, or any of the others, Target, or Kohl’s, or any of the others, until Wal-Mart comes in. Wal-Mart is the first one to come in. Once they do that, then the rest of them come in. Now that may seem, on the face of it, to be bad thing, but what it does is, because it improves the shopping environment in the region, the demographics of the region actually get better. In other words, we become a more attractive place to live. As a general rule, that means that we end up with higher household incomes. The challenge for the downtown is how do you capture some of that disposable income. How do you capture some of that purchasing power from those higher income households? And it requires that a businessperson, frankly the women owned businesses on Pomfret Street have figured this out, that you actually develop businesses that will appeal to niches. Mary’s got a niche with the antique co-op, but Pat Craig on Pomfret Street has a niche with her framing studio and her gift shop, and Lynn Jackman with her tearoom. Essentially, you have to figure out as a business owner, how can I draw people who are frankly living in suburban sub-divisions that surround this town. They are being built in greater number because we have a better shopping environment overall. How do we capture some of those dollars, some of that purchasing power? Probably, I would say women owned businesses, maybe because women instinctively have a better idea of what people are interested in buying. It could be because they do more shopping and then, that’s a stereotype, but it’s probably not an untrue stereotype. But they seem to know what products or what merchandise will sell in a retail environment. That could explain, maybe why they have been more successful, because instinctively they have a better handle on what will work in the market.
MOLLY OSBORN: Do you think the business owners in the area have set a new precedent for businesses?
CHRIS GULOTTA: Yes and that’s precisely the point. To the extent that you can identify a niche that the downtown thrives – there are certain niches that the downtown thrives in undertaking. A restaurant is one – because you can never create the ambiance or the atmosphere of some of our downtown restaurants in a shopping center. So people have figured out that a downtown restaurant that is fine dining or casual dining. If the food is good, there is a certain atmosphere having it in the downtown. There are certain other types of businesses that thrive in a downtown. Boutiques. One of the reasons we did the Farmers Market, just recently, because we think that’s a good fit for the downtown for a variety of reasons. I think there are other businesses that could thrive. I think we’re figuring out frankly what is a good fit for this downtown beyond restaurants, farmers markets, and some boutique shops. I think we’re trying to figure that out.
MOLLY OSBORN: Do you think, from here on out, there is going to be a rise of female business owners, as opposed to men?
CHRIS GULOTTA: I think, nationally, there is a trend. I just saw a statistic the other day that the trend on the national level demonstrates an increase in the number of females in businesses. I suspect that we will see that trend here in Cumberland County. I don’t have any reason to believe otherwise. I think in downtown settings, female owned businesses tend to compete well because women are not running the business like a hobby. For them, and that’s one of the problems we had in downtown, in part because a lot of these businesses were family owned. The building that they operated out of was all paid for, and candidly, I think some of the older retailers got lazy. Women owned businesses; they are not run as a hobby. These are women who, again, are very business savvy. They spend a lot of time on marketing the business and that is something that, frankly, a lot of traditional retailers have forgotten how to do – is to market the business. They kind of took the market for granted. For so long, the only shopping district in America was the downtown. That changed pretty dramatically in the 50s and 60s. A lot of people, they were good retailers because they provided good service, in terms of their merchandise, but they didn’t know how to market. Their marketing was based on a network of customers that had been built up for generations. But when that customer base was lost because the unfortunate reality is, a lot of those customers died. But those that didn’t die, they had a chance to buy some place else for 50% less, there is a limit to how much you can expect in terms of customer loyalty. So a lot of those businesses forgot how to market. They got lazy and assumed that people had been coming to them for generations as their customers would continue to do that. This new generation of women owned businesses, they know how to market, they know the right product mix and they know how to market. The combination of those two – that’s the ingredient for success. I mean, you have the right product and you know how to market it, you should be successful. The problem we had before in the ‘60s and ‘70s and actually part of the ‘80s I think, was we didn’t have the right product mix, and we have business owners who didn’t know how to market. That’s a prescription for disaster.
MOLLY OSBORN: Thank you. Do you have anything else you would like to add about Bedford Antiques?
CHRIS GULOTTA: No, I did look over some material in advance. I think I covered everything that was in the grant application. I pulled out the grant application that we wrote for her project with state money. Another reason I think we were interested in working with her is that in some ways, this was retaining a business. When the old K-Mart was demolished, essentially the antique co-op was a business. Mary worked there, she had a job there, so, the other reason I was interested in seeing this succeed is because it allowed us to essentially retain a business that had been operating there. I am very happy for her. She’s, as you know, knows what she’s doing and is enjoying success, and I’m very happy for her because she worked hard for it.
MOLLY OSBORN: Thank you.