Once the World Trade Center site is cleaned up, what happens to Ground Zero? Serious planning isn't expected to start until next summer, but the Big Apple is already buzzing with ideas for the space's future. Officials with the Lower Manhattan Development Corp., the government agency in charge of the site, want to turn the area into a hub of offices and homes. It would build what it calls a "museum of freedom and remembrance" to commemorate the 9/11 tragedies. The memorial, along with Ellis Island, the Statue of Liberty, and the New York Stock Exchange, would be marketed as a destination called "Freedom Park." (Some victims' families want a tomb of the unknowns added to hold the unidentified remains of hundreds.) Other New York officials want $7 billion-plus to rebuild the public-transit network that ran beneath the World Trade Center. That includes rebuilt stations, a new bus terminal, and more than $1 billion in additional security.
Man knows not his time
Thor Heyerdahl was no ivory-tower theorist. He developed novel ideas about human migration, and then tested them himself by sailing in primitive vessels. The explorer sold millions of books and became a national hero in his native Norway. Mr. Heyerdahl died last month at age 87. After being diagnosed with a terminal brain tumor, he stopped taking food, water, or medication and soon died in his sleep. Mr. Heyerdahl became a legend when he set off to cross the Pacific aboard a balsa raft in 1947. Warned that he would quickly sink, he stayed afloat for 101 days and 4,900 miles and reached Polynesia from Peru. He and five companions withstood high seas and sharks before washing ashore-and the tale of Kon-Tiki became a global fascination. His later expeditions included voyages aboard the reed rafts Ra, Ra II, and Tigris.
San Francisco's Fior d'Italia restaurant has survived time, earthquakes, and fire to become one of America's oldest Italian restaurants. Now the 115-year-old establishment faces a new threat: the IRS. The eatery's dispute over taxes has now reached the Supreme Court. Other restaurant owners are watching this case closely because it concerns the Social Security taxes paid on their employees' tips. (The IRS said tips totaled $14.31 billion in 1999.) Now Fior d'Italia is challenging an extra $23,000 in taxes, which managers say they should not have to pay. "We're not fighting over $23,000," said Bob Larive, co-owner of Fior d'Italia. "We're fighting something that is wrong." The case hinges on whether the IRS can levy Social Security taxes on audited restaurants based on estimates of the tips workers earn, rather than the true amount. Taxes on tips have been a bookkeeping hassle for years. Restaurants pay 7.65 percent Social Security taxes on their employees' tips; the workers shell out the other 7.65 percent. In Fior d'Italia's case, the 9th U.S. Circuit Court of Appeals ruled last year that the IRS couldn't "slap the employer with assessments based on ... estimates." It ruled the agency should audit the employees instead. Other circuits have ruled otherwise, so it's up to the Supreme Court to break the impasse.
Voting 3-2, Philadelphia's School Reform Commission last week voted to hand management of some of the city's failing elementary and middle schools over to private companies and nonprofits. The decision turns over 20 schools to Edison Schools, Inc., five to Chancellor Beacon Academies, and three to Victory Schools. Parent groups and nonprofits will take over several others. The changeover may take place as early as September. For the National Education Association, the teachers union that vociferously opposed the privatization plan, the move may be a slap in the pocketbook. The Philadelphia district is the nation's 7th largest, with 200,000 students in 265 schools and a $1.7 billion budget. If the NEA fails to unionize Philly's new private partners, the drain on union dues could begin to threaten NEA's power in the city. Daniel Whelan, a reform-minded commissioner, said it was the right prescription for affected schools, where more than half of students score in the bottom quarter on state reading and math tests. Said Mr. Whelan of the privatization vote: "If anything, we erred on the side of caution."
Investors beware: In a new identity-theft and swindling scam, crooks lure victims by tempting them with lower taxes. The Office of the Comptroller of Currency in April warned the nation's banks, the Federal Reserve, the Federal Deposit Insurance Corporation, and bank regulatory agencies of a new scheme in which thieves impersonate bank officials and use phony Internal Revenue Service forms to bilk bank customers out of cash. Here's how it works: Using bank letterhead, swindlers send depositors a letter saying the institution is trying to identify persons exempt from reporting or paying taxes on certain kinds of financial dealings. The letter is accompanied by "Form W-9095," a bogus IRS form. The "bank" letter asks customers to complete and fax the form-which calls for detailed personal and bank account information-within 7 days, or risk a 31 percent tax-withholding on earned interest. Information on the form arms criminals with everything they need to gain access to victims' accounts. The Comptroller's office warned banks and government agencies that any customer who completed and faxed Form W-9095 should inform the IRS, relevant financial institutions, credit reporting firms, and their local police.
Is WorldCom a bomb? Once a Wall Street darling, the telecom giant that owns MCI is trying flat-rate phone service as a way to recover from major financial woes. Under a plan called "The Neighborhood," customers can purchase unlimited local and long-distance calls for a flat monthly fee of about $55. The service was launched in 32 states last month, and customers in those states will receive one bill for all home phone service under the plan. Flat-rate service is a first in many markets and could allow great savings for many heavy callers. WorldCom plans to offer the service nationwide by early next year. It must pay fees to access residential phone networks, so local phone companies will still make some money from the deal, even though it means competition for them. Will The Neighborhood help rescue WorldCom financially? Some analysts question how many customers will sign up for the service, since many residential phone bills hover around $55 or less anyway. "I'm not sure how much, all-you-can-eat' is going to make a difference," said analyst Pat Comack of Guzman & Co. in Miami. "I think they'll have to lower the price to increase volume." In the meantime, WorldCom is now buried under an avalanche of economic woes, including falling revenues and billions in debt. To make matters worse, the company faces an ongoing Securities and Exchange Commission investigation into accounting and loan practices. The company's stock fell to around $3.50 a share in April, less than a tenth its value two years ago. One of WorldCom's challenges is that it has two business models in one industry. One is the familiar MCI, which sells voice phone service. The other includes data, Internet, and international services, which carry great promise but have suffered since the recent tech meltdown. Last year, stockholders approved a plan to divide the two units into co-existing halves, including a special tracking stock for MCI. WorldCom also announced in April that it would eliminate 3,700 U.S. jobs to cut costs.
Apostolos Gerasoulis says he's built the best search engine in the world. His Teoma.com is gunning for Google's place as the top tool on the Internet. Even with the dot-com boom over, there's a new war for Web dominance. Mr. Gerasoulis, a Rutgers University mathematics professor, started the project back in 1999 and sold it to Emeryville, Calif.-based Ask Jeeves last year for $4.4 million. The company claims Google's index is beset with useless items-and offers Teoma as a better filter. While many consider Google, which processes more than 150 million searches a day, the best of its kind, Teoma adds a major twist to Web searching: It divides the Net into various so-called "communities" according to subject matter. Teoma splits its results pages into three listings: results, refine, and resources. The results list is a familiar list of links. The refine list gives other keywords that might help narrow a search. The resources list points to topical sites from what Teoma calls "experts and enthusiasts." Teoma's owners claim that better filtering means that its database holds just 200 million pages, compared to Google's index of 3 billion documents. Even with fewer pages, they claim their site has more relevance. Search engines were once considered the sweet spot of the Internet. Many names like WebCrawler, Magellan, and Infoseek appeared and died out or fell into obscurity. Over time, Google built a reputation for simplicity and accuracy. Teoma faces an uphill battle.
Call it paper spam. So-called "junk faxes" have spawned a new legal debate over whether unsolicited ads sent via fax constitute free speech or a costly irritation. Some areas of the country have laws banning them as unnecessary burdens on recipients. But a Missouri judge has ruled that the First Amendment protects junk faxes. U.S. District Judge Stephen Limbaugh (yes, Rush's cousin) threw out Missouri's lawsuits against two companies that sent junk faxes. He ruled that businesses can advertise by fax unless there's proof such faxes harm recipients. The state's attorney general, Jay Nixon, is threatening to take the case to higher courts. Mr. Nixon had sued Fax.com and American Blast Fax under the federal Telephone Consumer Protection Act of 1991, which bars such sales pitches without the receiver's invitation or permission. He claims that junk faxes tie up consumers' machines, waste paper, and force recipients to pay for extra supplies. The fax debate could affect efforts to restrict the unsolicited online advertising that clogs countless inboxes. Anti-spam activists want junk fax bans to cover e-mail, so that angered users can take companies to court. Some spammers have moved offshore to escape legal action. One major decision has already upheld the junk fax ban. In 1995, the San Francisco, based 9th U.S. Circuit Court of Appeals ruled that the law provides "a reasonable means of preventing the shifting of advertising costs to consumers." Thus it doesn't violate the faxer's freedom of expression. Since the two decisions differ so radically, legal analysts say the junk fax case could reach the highest court.