Published May 14. 2012 4:00AM
DOT rejects application by Warwick operation to move to N. Stonington
If Connecticut is open for business, Bob Romano wants to know who turned out the lights.
Romano, owner of Warwick, R.I.-based Coutu Brothers Movers, applied several months ago to expand his current three-truck moving operation into North Stonington. By his estimation, Romano spent more than $6,000 doing everything the state Department of Transportation told him to do: leasing a convenient location on Norwich-Westerly Road, paying his business-entity fee and even making repairs to the office space he intended to occupy.
Then, last week, a DOT hearing officer issued what Romano saw as a stunning denial of his application, saying the business owner had not proved there was a need for his services and noting that two other moving companies in the region had claimed new competition would hurt their businesses.
"You'd think they'd be looking for new businesses," Romano said. "How can they not welcome a new business in this climate?"
It's a climate that Gov. Dannel P. Malloy said he would change, declaring repeatedly "Connecticut is open for business." But Romano and former Republican state Sen. Pierce Connair, a real estate agent who arranged the moving company's lease, say the slogan rings hollow when a small, independent company spends thousands of dollars to comply with Connecticut law only to be told it can't do business in the state.
"I just can't believe that we're that anti-business," Connair said. "I don't know what kind of mentality makes this happen."
A spokesman for the Malloy administration did not respond last week to questions about the license denial. A spokesman for the state Department of Economic and Community Development deferred comment to the DOT.
Judd Everhart, a DOT spokesman, said the agency's denial was based on "lack of proof by the applicant as to public need for its service. If the applicant had shown the public need, they could have been granted the authority even with opposition."
Only three other companies in the past two years have applied for a state license to move household goods, he said, and all the other requests were granted, including one from an out-of-state firm.
The moving company owners who opposed Romano's application to do business in Connecticut said they were simply protecting their self-interest. Small moving companies have been in a state of decline in Connecticut, they said, pointing out that R Blinderman Motor Lines in Waterford went out of business earlier this year.
"I've never seen it this bad for this long," said Charles Rohde, owner of Atherton & Sons Moving & Storage in Pawcatuck and a 40-year industry veteran. "The whole industry is real estate-dependent."
"I think I have a good business," added Dean DePietro, owner of Barnes Moving & Storage in Mystic. "But for someone to move down the street, that's going to hurt."
DePietro and Rohde confirmed that they had told the DOT their businesses were down 30 percent to 40 percent from heights seen five years ago. DePietro's employment numbers have dropped from 20 to 13, and Rohde answers the phones at his company in lieu of a receptionist he once employed.
Neither of the moving-firm owners provided any documentation to the DOT about the declining sales numbers they cited in testimony.
Rohde likened regulations in the moving business to the state's mandate that package stores be limited based on the adult population of a particular area.
"It's similar in that a certain number will be allowed based on business trends," he said.
While DePietro and Rohde painted themselves as small operators, Romano pointed out that each of them is affiliated with a major moving company - DePietro with Mayflower Van Lines and Rohde with Wheaton World Wide Moving. Each of the opposing moving companies has a Rhode Island license, the owners confirmed, which means they can conduct moves within the Ocean State, while Romano is barred from doing in-state business in Connecticut thanks to the DOT decision.
Romano has been told his only option is to appeal the decision to Superior Court, which he figures would add thousands of dollars to his expenses with no guarantee of success. Romano had planned to hire three people in Connecticut and to operate one truck within the state, expecting to do about $150,000 worth of business in the first year.
"I thought this (application for a license) was just a formality," Romano said. "In Rhode Island and Massachusetts, I was in and out (while getting a license) in 15 minutes."
The DOT denial, filed two days after a May 1 hearing, cited "a further negative effect" on other moving businesses in Connecticut if Romano's application had been approved. But the main reason for denial, according to the decision, was that Romano had not proven the need for another moving company in the region based on "public convenience and necessity."
Romano testified that he receives five to 12 calls a month from potential Connecticut customers looking forward to in-state moves, but without a state license he must turn down the business. He didn't know how else to quantify the need for a new moving company in town.
Everhart, the DOT spokesman, said other applicants have provided logs of phone calls requesting moving services, but he said the best route would have been to present testimony from people who can talk about the need for movers in the region.
"Live witness testimony is what other operators have used in the past to be granted authority," Everhart said in an email response to questions. "The applicant in this case presented only one witness who had no firsthand knowledge about the need for an additional moving service in Connecticut."
"I think I got a bad rap," Romano said. "I was trying to do everything by the book."
Connair, who leased office space to Romano, said the denial created a chain reaction. Not only did he lose a tenant, but a plumber, electrician and rug installer in Connecticut are out of work as well.
"This isn't the free enterprise system," Connair said.
The DOT decision, he said, essentially protected local moving businesses from facing the kind of competition that keeps American firms thriving.
"Why do they have the right to monopolize all of eastern Connecticut?" he said. "Big Brother should not dictate who does business in Connecticut."