Richard Beaupre, chief executive officer of ChemArt Inc., in Lincoln, explains to House Finance Committee members how the company produces Christmas ornaments, including the ornament for the White House Historical Association.

The Providence Journal / Steve Szydlowski

Some of the state’s most successful manufacturers say Rhode Island needs to lower taxes, streamline regulatory permitting and improve education in order to create new jobs in the state.

Five companies hosted tours of their facilities for the seven members of the House Finance Committee on Thursday. The tour was arranged at the request of the committee chairman, Steven Costantino, to learn how these companies have managed to prosper in this poor economic climate, and to solicit their advice about what the state can do to turn its economy around.

Job creation has become a key priority for elected officials in Rhode Island after the state’s unemployment rate hit 8.8 percent this fall, making it the worst in the country. On Friday, the state reported the rate had risen even higher last month, to 9.3 percent, the highest since 1983.

“We have to become aggressive bringing jobs into the state,” Costantino said on Thursday morning, as he and his fellow committee members rode in a minibus to the first stop on the tour.

Asked what legislation he envisioned that might help, Costantino said he wasn’t at that stage yet. He said the tour was the beginning of a process to take a proactive approach to improving the job situation. That involves both bringing new jobs to the state by helping Rhode Island companies expand, and by attracting new firms here.

The effort is vital, Costantino said, because the state’s budget problems are largely caused by a drop in expected revenue from income taxes and other sources.

“We’ve got to start reversing the trend.”

The first stop was Meridian Printing, an East Greenwich company that prints coffee-table style books of artwork and photographs, as well as limited edition calendars and posters. Titles include works by well-known photographers, including Ansel Adams and Annie Leibowitz.

Company president Bob Nangle said his company has been successful by focusing on a particular niche in the printing business.

“We don’t sell on price, we sell on quality,” Nangle said. About half of the company’s business comes from museums, galleries and artists, he said.

Meridian has invested heavily in new equipment, which Nangle said was the only way to avoid the fate of other printers that have fallen by the wayside. One big investment was the purchase of a $3.5 million printer, capable of printing 10 colors.

Meridian employs 75, a number that has remained constant over the past five years, even as the company has grown. Sales and profits are up for the year, he said, a feat accomplished by “a lot of cutting” and managing efficiencies. For example, the company changed its retirement plan. It had been putting 3 percent of an employee’s wages into the plan, regardless of how well the company was doing. Now, it makes a discretionary match to a 401(k) plan. The match depends on the company’s profits.

Nangle said one of the problems the company faces is finding young people willing to learn the printing trade. “These kids don’t have a drive now,” he said. Some want immediate gratification –– to become the head printer right away. When they hear it may take 10 years to get to that level, they lose interest, Nangle said.

Next was the Allied Group in Cranston, a company that helps other firms attract new business. It promotes itself as a one-stop shop in which it can help define a campaign and then build Web sites and print brochures, even personalizing them for the client. For example, it prints a brochure for Bryant University that is mailed to prospective students. Each brochure is personalized, containing in large letters the name of the student the school is trying to attract.

The company has 155 employees in three locations: Cranston, Cumberland and Providence. Jack Bidden, vice president of operations, told the legislators that his company’s biggest challenge now has been the recent economic slowdown. Sales are down 3 percent to 4 percent from last year.

The company had to lay off 10 people, he said, out of “economic necessity.”

We’re fortunate we’ve watched our bottom line very carefully,” he said.

Its success, Bidden said, has come from diversifying into several different markets. About 50 percent to 60 percent of its business has some connection to the medical field.

For example, it manufactures a kit that is used in hospital delivery rooms to take blood from an umbilical cord to be used for stem cell research and treatments.

At North Safety Products, the legislators watched machines transform little bits of plastic into recognizable shapes: construction helmets and filter holders for gas masks. The company, now part of Honeywell Life Safety, makes personal protective gear, including eye and face protection, first aid products, gloves, footwear and several other products.

The company shipped many of its breathing masks to recovery workers in New York following the September 11 terrorist attacks, said Neale Commiskey, vice president of operations for North America.

The company expects to add more jobs in Rhode Island as a result of Honeywell closing a sister company in Canada, he said. The company will move some injection molding equipment from that site to Cranston, he said.

Commiskey said that energy and health care costs are chief concerns for his business. He also mentioned to the legislators that he’s “still paying” his employees time and a half to work on VJ Day. Rhode Island is the only state in the country that celebrates this holiday.

North Safety now employs about 350 people who work in three shifts, 24 hours a day.

ChemArt Inc., in Lincoln, is one of the last remaining Christmas ornament makers in the United States. The company’s flagship products are three-dimensional metal Christmas tree ornaments that have intricate designs and colors.

The company has been selected to make the official ornament for the White House Historical Association since 1981, said the company founder and chief executive officer, Richard Beaupre.

The company employs 160 people during its busy half of the year and 84 during the other six months.

Beaupre told the legislators that he fears that taxes will have to go up in order to fix the budget gap. “I don’t really see how we can survive without going up on taxes,” he said. “I wouldn’t want to be in your shoes,” he told the group.

Beaupre said he personally benefited from a reduction in Rhode Island’s income tax for high-wage earners. “I pay enormous taxes,” he said –– up to $300,000 a year. He said he was “amazed” that the lower income tax rate trimmed his tax bill by $15,000.

The tour concluded at Technical Materials Inc., a Lincoln-based manufacturer that specializes in making special metal alloys used in the electronics and automotive industries.

Inside the factory, narrow strips of metal rolled off three- and four-wide spools into machines that applied coatings, or bonded them with other metals. The spools resembled giant tape recorder reels.

Al Lubrano, the company president, said one of its specialties is bonding aluminum with steel. “Aluminum,” he explained, “doesn’t like to bond with steel.”

The metals TMI produces are used in high-precision devices, such as computer hard drives. Lubrano said that one-third of all laptop computers with a hard drive contain a part that was made by TMI.

TMI has also suffered from the recent economic downturn. At a meeting last month with President Bush, Lubrano and other manufacturers said their businesses were threatened by the inability of customers to get credit. Lubrano said at the time his company may face layoffs and, in fact, TMI laid off about 30 employees three weeks ago. The company now employs about 190 people.

At a luncheon following the tour Biddick, of Allied Group, and Nangle, of Meridian Printing, joined Lubrano and the legislators for a discussion.

Nangle suggested that Rhode Island invest in a single, centrally located vocational school rather than having seven or eight spread throughout the state. He said that could save money and better train students for particular jobs.

He also mentioned the need to improve some of the ways permits are issued to businesses. For example, he said there is no statewide water disposal regulation. Rather, wastewater is regulated on a local level and regulations often differ from one community to another.

Costantino agreed. “Maybe we need a streamlined government process, not always to say yes, but also to say no in a timely manner.”

About environment regulations, Lubrano said his company spends a lot of money to comply with them, and he suggested the state take notice of that by offering tax credits, or perhaps starting an awards program to recognize the top firms.

In an interview, Lubrano elaborated on his suggestions.

“We will fix our problems in the most expeditious and thorough manner by adding jobs. To add jobs is necessary to keep the state competitive.

“We have to be very careful and judicious about what we do from a tax standpoint.”

He said he also supports consolidating the state’s school districts into two or three. “Rhode Island is basically the size of one school district in Massachusetts,” he said. Consolidation could save hundreds of thousands of dollars.

Lubrano said that elected officials and business owners should come together to address these issues and form a group “that’s actually going to get things done.

“If you get business guys involved — we solve these problems every day in business. Use our knowledge so at the end of the day we can make our state taxes go down, and make our state more competitive.”

tbarmann@projo.com