Published: January 25, 2009 12:16 am      

Federal raid stuns business leaders

Barry Jerley has during the past several years viewed Kuchera Industries and Kuchera Defense from several vantage points.

Jerley, a former Windber Borough Council member, often listened to representatives from the company make proposals for changes they hoped to make on the companies’ grounds.

He also frequently found himself representing the borough at the companies’ offices for contract awards and announcements of new jobs coming to town.

“Everything has always been positive,” Jerley said. “They’re good for our community.”

The companies were hit with plenty of negative publicity when on Thursday raids of the businesses and the homes of the top executives – Bill Kuchera, CEO, and Ron Kuchera, chief financial officer – were carried out through the combined effort of three federal agencies.

Authorities have not cited any reasons for the raids. Kuchera, in a statement issued on Friday, said only that books and records were seized and that the companies were not aware of any discrepancies.

Many in the region were stunned by the news. Leadership in the region couldn’t fathom why the companies would garner such interest from the federal government.

“We’re sort of in a wait-and-see situation,” said Linda Thomson, president of Johnstown Area Regional Industries.

“We don’t really know what’s going on, and I’d never begin to even speculate.”

What Thomson could confirm is that the two companies have become significant members of the regional economy.

Between the two, they have more than 300 workers, making the Kuchera companies the second-largest employer in Windber.

“Right now, you have a lot of companies coming into Windber doing a lot of work with the companies on both the defense and commercial sides,” said Art Palumbo, mayor of Windber.

“You have people visiting our community and recognizing what we have to offer.

“It’s good to see people doing business in the area. And there’s a spinoff they create for the whole area. We just hope this is resolved quickly.”

Much of that spinoff and impact on the region is the product of a healthy contracting relationship with the Department of Defense.

The Office of the Secretary of Defense released records on Friday showing that between fiscal years 2007 to 2009, Kuchera has obtained 37 direct contracts with the Department of Defense with a base value of more than $27 million.

With options, the value of the contracts can increase significantly.

Among those 37 contracts, records show that only one was not won through an open, competitive bidding process.

“They’ve been growing,” Thomson said. “They’re a growth-oriented company.

“They have started to hire more engineers and have been looking to develop new product lines. They’re a very progressive company and a centerpiece to the Windber community.

“They’re a very important player in our defense community. And they have a lot of subcontracting networks in the region that spread some of the work around.”

It’s through the use of local subcontractors that Jerley developed a different relationship with Kuchera. His company, Jerley Autobody, 1296 Jackson Ave., Windber, has performed contract work for Kuchera Industries for about three years.

Jerley said that before he opened his shop four years ago, Kuchera would send the same paint work his company performs out of the region. Now, that work provides vital revenue that at times is solely responsible for keeping his shop working.

“If I didn’t have the work from them, business here from time to time would be a lot slower,” Jerley said. “I might even have to lay off my guys.

“They’ve been great to work with for my company.”