NJ second-home owners in limbo a year after Sandy

STAFFORD TOWNSHIP, N.J. — The Jersey shore's vacation bungalows and cottages have for decades staked out little plots of paradise where families who scrimped and saved could while away summer evenings, parents having drinks on the deck and kids working at an ice cream stand or stealing a first kiss under a boardwalk.

Now, nearly a year after Superstorm Sandy blasted through, countless middle-class families whose tiny vacation homes were once the place to make precious memories are finding them to be a financial albatross.

While billions of dollars in federal relief have helped primary homeowners rebuild after the storm, second homeowners find themselves stuck in limbo: not eligible for enough money to rebuild or even demolish their homes while they remain on the hook for mortgage payments and fatter flood insurance fees for houses they can't even use.

"We thought we were good for the community, and to suddenly be labeled this second homeowner like it was a derogatory statement, it was like a smack in the face," said Benita Kiernan, a retired nurse who with her retired New York City firefighter husband sank every spare cent into a cottage on an inlet in Stafford Township.

"We became the scarlet-S second homeowners."

For decades, the Jersey shore has been a place where police officers, plumbers, teachers and other working-class families can save up and put a down payment on a small beach bungalow to spend their summers "down the shore," as it is called. In many cases the properties are passed down through families.

Even before Sandy tore the Kiernans' home down to a wooden shell, it was not the palatial estate conjured by the phrase "vacation home." But even then the modest 1,000-square-foot house had been a financial stretch — the family skipped dinners out and vacations to be able to afford it.

The sacrifice has been worth it, Kiernan said. The shore is where their grandchildren played, their four daughters packed in with their friends and the couple was considering moving full time because they viewed the community as a second hometown.

"It was low-key fun," Kiernan said.

But the little house offers mostly heartache now. The Kiernans received about $100,000 from their insurance company, but that's less than half the amount of their policy and nowhere near enough to pay the mortgage and shoulder the cost of demolishing and rebuilding.

"This was our investment," John Kiernan said as his wife wiped away tears.

Even tearing down the house and selling the lot is no easy way out — while homes have been selling on the Jersey shore, values are not what they were before the storm.

"Do I build it, do I leave it? I can't even sell the property because properties have been downgraded that much," he said.

Second homeowners are not eligible for a suite of relief options available to primary homeowners. Federal Emergency Management Agency rebuilding assistance, $1.8 billion in rebuilding funds the U.S. Department of Housing and Urban Development gave to New Jersey or low-interest loans from the Small Business Administration. Second homeowners will also see their flood insurance rates go up because they are not grandfathered in like primary homeowners.

In Lavallette, the skeleton of Cora Hoch's sea glass-colored vacation bungalow remains, its foundation tipped, wiring exposed, doors missing and "do not enter" spray-painted on the side.

"We put our life savings into that little house," said Hoch, a school nurse from Kearny, N.J. "We can't afford to fix it, and FEMA will not give us anything."

FEMA said the assistance money is meant to be a one-time stopgap measure to help people get back into their primary homes as soon as possible. Congress, FEMA said, set the rules.

"It was designed for those who don't have a roof over their head or a place to live," said Tom McDermott, a FEMA mitigation specialist. "I guess they said if they can afford a second home or a camp, and don't take this the wrong way, it isn't necessary that they get back up so they can enjoy a weekend or a week away."

Second homeowners said the problem is that insurance doesn't fully cover the price of the options for these homes: rehabbing and, in many cases, lifting them or demolishing them and rebuilding from scratch.

"Everybody is in limbo because you can't proceed to the next step," said Benita Kiernan, whose neighborhood is now a patchwork of vacant damaged homes, freshly leveled lots and small ranch homes boosted up on stilts in an effort to keep them out of the water the next time a massive storm strikes.

Many are waiting to see if they can qualify for any other assistance, but aside from private charities, there is little help. Some are dipping into their retirement funds.

Michelle and John Novella are rebuilding their Stafford Township home on their own, putting everything on credit cards.

"First homeowners should be the priority," Michelle Novella said, but she feels second homeowners who patronize the seasonal businesses and make up the lifeblood of the Jersey shore should get something.

"Otherwise," she said, "it's going to make the Jersey shore very different."

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Follow Katie Zezima at www.twitter.com/katiezez

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JPMorgan's $5B settlement doesn't end its troubles

WASHINGTON — The $5.1 billion that JPMorgan Chase has agreed to pay hardly ends its legal troubles over mortgage securities it sold.

It's merely a down payment.

JPMorgan still faces heavy financial burdens. The bank has set aside $23 billion to cover legal costs — and it may need it all.

In a statement Friday night, JPMorgan called its latest settlement an "important step" toward resolving allegations over mortgage-backed securities it sold. The $5.1 billion would resolve federal claims that it misled Fannie Mae and Freddie Mac about risky home loans and securities they bought before the housing market collapsed.

Fannie and Freddie were rescued in a taxpayer bailout in 2008 as they sank under the weight of mortgage losses.

Between 2005 and 2007, JPMorgan sold $33 billion in mortgage securities to Fannie and Freddie, according to their regulator. That was the second-most sold to Fannie and Freddie ahead of the crisis, behind only Bank of America. The securities soured after the housing bubble burst in 2007, losing billions in value.

Fannie and Freddie own or guarantee about half of all U.S. mortgages, worth about $5 trillion. The two don't directly make loans to borrowers. They buy mortgages from lenders, package them as bonds, guarantee them against default and sell them to investors. This system helps make loans widely available to borrowers.

The Federal Housing Finance Agency, which oversees Fannie and Freddie, announced Friday's settlement with JPMorgan, the largest U.S. bank.

The deal is expected to be followed by a broader agreement with the Justice Department that's still being negotiated. Last weekend, JPMorgan reached a tentative deal with Justice to pay $13 billion.

The $13 billion tentative deal included $4 billion to resolve the FHFA claims. Even reduced by that amount, it would be the largest penalty the government has extracted from a company for actions related to the financial crisis. It's unclear when the broader agreement will be finalized.

The bank still faces local, state and federal investigations into its sale of the mortgage-backed securities. Most of the trouble stems from JPMorgan's acquisition of Bear Stearns in March 2008.

In September, JPMorgan agreed to pay $920 million and admit that it failed to oversee trading that led to a $6 billion loss last year in its London operation. That combined amount, in settlements with three regulators in the U.S. and one in Britain, is one of the largest fines ever levied against a financial institution.

In another case, the company agreed to pay a $100 million penalty and admitted that its traders acted "recklessly" with the London trades.

If that weren't enough, JPMorgan is tied up in litigation over the Bernard Madoff Ponzi scheme. JPMorgan has said it's responding to investigations by Justice and other regulators. The bank hasn't given details. But it has previously faced accusations that it and other banks ignored signs that Madoff was a con artist.

Edward DeMarco, the FHFA's acting director, said the settlement with JPMorgan "provides greater certainty in the marketplace and is in line with our responsibility for preserving and conserving Fannie Mae's and Freddie Mac's assets on behalf of taxpayers."

The FHFA sued 18 financial institutions in September 2011 over their sales of mortgage securities to Fannie and Freddie. The total price for the securities sold was $196 billion.

The government rescued Fannie and Freddie during the financial crisis when both were on the verge of collapse. The companies received taxpayer aid totaling $187 billion. They have since become profitable and repaid $146 billion.

Of the $5.1 billion it's agreed to pay, New York-based JPMorgan will pay about $2.74 billion to Freddie and $1.26 billion to Fannie for mortgage bonds it sold. JPMorgan is paying a separate $1.1 billion for home loans it sold them.

The mortgage securities that JPMorgan sold to Fannie and Freddie included billions that were packaged by two institutions that failed in 2008: Wall Street bank Bear Stearns and Seattle-based Washington Mutual, the largest U.S. savings and loan. JPMorgan bought Bear Stearns and Washington Mutual in deals brokered by the government.

A number of big banks, including JPMorgan, Goldman Sachs and Citigroup, previously have been accused of abuses in sales of securities linked to mortgages in the years leading up to the crisis. Together, they have paid hundreds of millions in penalties to settle civil charges brought by the SEC, which accused them of deceiving investors about the quality of the bonds they sold.

But no high-level Wall Street executives has been sent to jail over charges related to the financial crisis. And the banks in all the SEC cases were allowed to neither admit nor deny wrongdoing — a practice that brought criticism of the agency from judges and investor advocates. Some lawmakers and other critics have demanded that the big bailed-out banks and senior executives be held accountable.

JPMorgan had long enjoyed a reputation for managing risk better than its Wall Street competitors. The bank came through the financial crisis in better shape than most of its rivals.

But in recent months, it has been engaged in a number of embarrassing and costly settlements. In September, the bank agreed to pay $920 million and admit that it failed to oversee trading that led to a $6 billion loss last year in its London operation. That combined amount, in settlements with three regulators in the U.S. and one in Britain, is one of the largest fines ever levied against a financial institution.

In another case, the company agreed to pay a $100 million penalty and admitted that its traders acted "recklessly" with the London trades.

And in a first for a major company, JPMorgan admitted in the agreement with the SEC over the trading loss in London that it failed in its oversight.

___

Sweet contributed to this report from New York.

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Another month of fixes for health care website

WASHINGTON — It should be working well by the end of November. That's the Obama administration's rough timetable for completing a long list of fixes to HealthCare.gov, the new, trouble-plagued website for uninsured Americans to get coverage.

Summarizing a week's worth of intensive diagnostics, the administration acknowledged Friday the site has dozens of complex problems and tapped a private company to oversee fixes.

Jeffrey Zients, a management consultant brought in by the White House to assess the extent of problems, told reporters his review found dozens of issues across the entire system. The site is made up of layers of components that are meant to interact in real time with consumers, government agencies and insurance company computers.

It will take a lot of work, but "HealthCare.gov is fixable," Zients declared.

The vast majority of the issues will be resolved by the end of November, he asserted, and there will be many fewer screen freezes. He stopped short of saying problems will completely vanish.

The troubles have been nightmarish for the White House, which had promoted enrollment to be as simple as making a purchase on Amazon.com. This week, President Barack Obama declared himself frustrated by the setbacks while still trumpeting the benefits of the health care law and encouraging consumers to apply by phone if the website proved a hindrance.

In his weekly radio and internet address Saturday, Obama vowed that "in the coming weeks, we are going to get it working as smoothly as it's supposed to." In the meantime, he encouraged the public to call 1-800-318-2596 or visit LocalHelp.HealthCare.gov.

"We're only a few weeks into a six-month open enrollment period, and everyone who wants insurance through the marketplace will get it," he said.

As part of its effort to repair the system, the administration said it is promoting one of the website contractors, a subsidiary of the nation's largest health insurance company, to take on the role of "general contractor" shepherding the fixes.

Quality Software Services Inc. — owned by a unit of UnitedHealth Group— was responsible for two components of the government's online insurance system. One is the data hub, a linchpin that works relatively well, and the other is an accounts registration feature that initially froze and caused many problems.

HealthCare.gov was supposed to be the online portal for uninsured Americans to get coverage under Obama's health care law. Envisioned as the equivalent of Amazon.com for health insurance, it became a huge bottleneck immediately upon launch Oct. 1. The flop turned into an embarrassment for Obama and will likely end up as a case study of how government technology programs can go awry.

The briefing from Zients came a day after executives of QSSI and the other major contractor, CGI Federal, told Congress that the government didn't fully test the system and ordered up last-minute changes that contributed to logjams. Next week, Health and Human Services Secretary Kathleen Sebelius is scheduled to testify.

Visiting a community health center on Friday in Austin, Texas, Sebelius said that "in an ideal world there would have been a lot more testing" but added that her department had little flexibility to postpone the launch against the backdrop of Washington's unforgiving politics. House Republicans trying to defund the nation's health insurance program precipitated a government shutdown.

In the Republican address, Rep. Fred Upton of Michigan, the chairman of the House Energy and Commerce Committee, asked whether the problems evident now foreshadowed future troubles with the health care law.

"In a few short months, families across the country will be subject to penalties under the law's individual mandate," he said. "How can the administration punish innocent Americans by forcing them to buy a product many cannot afford, from a system that does not work?

Zients gave some new details about the extent of the problems, but administration officials are still refusing to release any numbers on how many people have successfully enrolled. Although 700,000 have applied for coverage through the new online markets, it's believed only a fraction of that number actually managed to sign up. Before the website went live, an administration estimate projected nearly 500,000 people would sign up in October alone.

The marketplaces are the gateway to obtaining health insurance under the new health care law, which requires most Americans to have coverage by Jan. 1. Middle-class people who don't have insurance on the job can purchase a private plan with new tax credits to make the premiums more affordable. Low-income people will be steered to an expanded version of Medicaid in states that agree to extend the safety net program.

The federal government is running the insurance markets or taking the lead in 36 states. The rest were set up by states themselves.

Consumers have until Dec. 15 to sign up for coverage to take effect Jan. 1. Under the law, pre-existing medical conditions will no longer be a barrier. But the markets also need lots of young, healthy customers to keep premiums affordable. Open enrollment season extends until Mar. 31.

Zients said almost daily fixes are already having an impact. For example, more than 90 percent of users can now complete one of the first steps, creating an account.

But the application process, which involves submitting and verifying personal information and income details, remains "volatile," he said. At one point, as few as one-third of users were getting through that part.

Zients said there are two big categories of problems. Performance issues involve the speed and reliability of the website. Functional issues are bugs that keep the software from working as intended. Among the high-priority issues is that insurers are getting enrollments with incomplete, incorrect or duplicative information.

___

Online:

Obama's address: http://www.whitehouse.gov

Republican address: http://www.gop.gov

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For Obama, health care woes may have staying power

WASHINGTON — For nearly five years, Republicans have struggled to make a scandal stick to President Barack Obama's White House.

One by one, the controversies — Solyndra, Benghazi, Fast and Furious, and others — hit a fever pitch, but then faded away.

But some Republicans see the disastrous rollout of Obama's health law as a problem with the kind of staying power they have sought.

The health care failures are tangible for millions of Americans and can be experienced by anyone with Internet access.

The law itself is more closely associated with Obama personally, and long has been unpopular with the public.

The longer the technical problems persist, the more likely they are to affect the balance of enrollees needed in the insurance marketplace in order to keep costs down.

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Facebook off limits for Macedonian clergy

SKOPJE, Macedonia — The Macedonian Orthodox Church has banned it clergy from using Facebook to protect against abuse and "new phenomena of confessions and intimate conversations with young people," local media report.

Reports on Saturday said the Holy Synod, the executive body of the Macedonian Orthodox Church, took the decision after one bishop's complaint.

Local media say the decision has already created tensions between older church dignitaries who do not use the Internet and are hostile to it, and younger clergy and even bishops who make use of social media.

Nearly two-thirds of Macedonia's two million people are Orthodox Christians.

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Feds give $20.5M grant to aid Dorchester plan

A $100 million redevelopment in Dorchester that includes housing, a food business startup incubator and other improvements will revitalize the Quincy Corridor neighborhood and be the model for future such projects across the city, local and federal officials said.

The Quincy Corridor Choice Neighborhood Transformation Plan, fueled by a $20.5 million grant from the federal Department of Housing and Urban Development, will completely transform a four-block stretch, according to Jeanne DuBois, executive director of the Dorchester Bay Economic Development Corp.

"Today marks the start of a new era for your neighborhood," Mayor Thomas M. Menino told the crowd of people yesterday gathered outside the former Pearl Meat factory, which will become an incubator for small food businesses that are expected to create new jobs in the area. "This grant is so important to this neighborhood, it's not just about a building," said Menino. "It's how you build people's opportunities."

The project includes redevelopment of the Woodledge/Morrant Bay HUD housing development into 129 affordable family homes, and a "maker space," to connect residents with high-tech skills.

"All of a sudden you're going to see all this activity," DuBois said. "It's going to feel like more of an urban village."

HUD Secretary Shaun Donovan said of the five cities nationwide awarded the Choice Neighborhood grant, Boston is the first to implement its plan.

"What we saw was a deep partnership that had been working in this neighborhood for years with a very clear vision of how to bring all the pieces together," Donovan said. "We want to replicate it all over the country."

That vision of a revitalized neighborhood without gentrification and exorbitant home prices, DuBois said, should be followed in other parts of Boston, as well. The plan initially called for more housing units, but it changed once community residents said job-creating facilities, such as the food incubator, were crucial.

"If you really listen to people in the neighborhood, it's about their quality of life," she said.

Menino said the key is to target development both for current and future residents.

"The most important thing is to continue to rebuild these neighborhoods so people can continue to live in them," he said. "It's time for all of us to make sure the results are there for the community. We have to invest in people."

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Hub home inventory way down this fall

A year ago housing inventory levels statewide were down 17 percent from the previous year. Well, here we are a year later and things are pretty much the same — which isn't necessarily a bad thing. That is, unless you're a buyer looking to find a home in the city of Boston.

The fall market is typically the second busiest time of the year for real estate transactions after the spring market. Yet where is the inventory? According to Otis & Ahearn Real Estate, the downtown Boston market currently has 328 units versus 531 units at the same time last year, which is a decline of 62 percent. At the same time, the average price of sold units year to date is $727,457, up from $660,864 last year. That's a 9 percent gain. The downtown market includes these neighborhoods: Back Bay, Beacon Hill, Bay Village, East Cambridge, Charlestown Navy Yard, Chinatown, Fenway, Financial District, Leather District, Midtown, North End, South Boston, South End, Seaport, West End and Waterfront.

So where is the inventory? Private sellers seem to be more hesitant to put their homes on the market, as they have no place to go. And with an abundant supply of new development inventory just a few years ago, developers who put the brakes on projects then for various reasons, including lack of financing, are now trying to play catch up. But that will take time.

With the last new building selling out at a record pace (Millennium Place in Downtown Crossing), there's not much left on the horizon for new inventory. The bulk of inventory currently being built is to be leased and not sold, although that could change as developers see the continued need for new supply. In any case, the time frame for these projects to be built is anywhere from 30 to 48 months from breaking ground to obtaining their certificates of occupancy, so any new inventory should come in about three years.

"In the downtown market there is only 1.5 months of supply inventory," said Kevin Ahearn, president of Otis and Ahearn. "Since 2004, the city has lost 1,100 units of sales priced at under $500,000." To this end, says Ahearn, "the city and the Boston Redevelopment Authority (BRA) are working to promote both higher density and height construction to help with this lack of lower priced inventory."

Two of the three strongest city markets (Back Bay and South End) have just 138 units between them, according to information gathered from the Multiple Listing Service Property Information Network.

Surprisingly, other than the latest bit of sluggishness in the market due to the government shutdown, which sparked a bit of fear with consumers, the market has held steady here in Boston.

According to Ahearn, "The city of Boston should have a record year in terms of overall number of transactions (with the exception of 2004 and 2005) since 1998."

Charlie Abrahams is a licensed real estate agent in Boston who works with buyers and sellers and can be reached at: Bostonrealestate@charlieabrahams.com.

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Somerville 3D printer co. raises Form-idable $19M

Somerville startup Formlabs has raised 
$19 million in institutional capital — a rare feat, even for a company responsible for the top-grossing tech project on Kickstarter.

The makers of the Form 1 3D printer already are expanding into an 11,000-square-foot facility in Somerville and will use the money to expand product research and development, grow customer support teams and drive international growth, said co-founder Maxim Lobovsky.

"There is still a wide open space in front of us to continue innovating and bringing incredible new products to the market," Lobovsky said. "With these new resources, we'll be able to continue to push the envelope, making extraordinary tools available around the world."

DFJ Growth led the financing round, together with Pitango Venture Capital, Innovation Endeavors and several returning angel investors.

"They have an opportunity to become a huge company in the desktop 3D printing space," said Barry Schuler, managing director of DFJ Growth in Menlo Park, Calif.

"We think that's the beginning of a big revolution in the way products are designed and manufactured."

The financing follows Formlabs' breakout Kickstarter campaign last year, when the company raised $2.95 million from thousands of backers in 35 countries for its high-performance 3D printer.

Backers on the crowdfunding site can expect greater service worldwide, new software features and continued innovation in affordable, high-performance digital fabrication tools, Lobovsky said.

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Climate’s changed at National Grid

Delivering clean, reliable, affordable energy well into the future is one of the greatest global challenges, National Grid CEO Steve Holliday told executives in Boston yesterday.

"Based on trends over the last few years, 2012 was supposed to be the year when investment in renewables globally surpassed fossil fuel generation for the first time," Holliday said during a speech before the Boston College Chief Executives' Club of Boston. "That didn't happen. Investment in fossil fuel generation started to increase again at the same time global renewable investment dollars tailed off, partly as a result of a drop in wind and solar generation costs."

The utility is "fundamentally changing how we operate" to address four areas of the global energy challenge: aging infrastructure, a revolution in energy supplies, extreme weather conditions, and an aging workforce and skills gap, according to Holliday.

The revolution in energy sources is being driven by aging power stations and wires, a growing realization of the impacts of climate and the need to reduce carbon emissions, and shale gas, according to Holliday.

The impacts of increasing extreme weather on National Grid were evident in 2011, when it "learned some hard lessons" responding to Hurricane Irene and an October nor'easter. "Our ... restoration efforts were, frankly, disappointing," Holliday said. "Our planning didn't account for the magnitude of the logistical challenges hitting our electricity and gas networks simultaneously, across three states and numerous regions. We now look at future scenarios, which include events we haven't seen before, to make sure we are better prepared."

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Globe scribe tweets he’s ‘tired of Boston Strong’

A Boston Globe reporter tweeted he was "so tired of 'Boston Strong,' " just as marathon survivors were being honored during the seventh inning of last night's Red Sox World Series game — and came under fire from shocked tweeters who schooled the Morrissey Boulevard scribbler in sensitivity.

"So tired of 'Boston Strong,' but still inspired by the resilience of so many of those wounded in the marathon bombings," Tweeted Globe scribe Wesley Lowery as James Taylor sang "America the Beautiful" flanked by injured victims in the marathon attacks.

"Say that to the families that lost a loved one. #Classless" Tweeted @WOOKIE318 in response.

"Calling out the fact that loss has been tied to sports team and monitized makes me classless?" Lowery responded.

"As someone who had federal agents searching her garage for a terrorist I feel differently," Tweeted @karamat.

Lowery said in follow-up tweets he was "tired of" the commercialization of Boston Strong as a slogan and that it became "meaningless (for me) once it was linked to sports." But the reporter added he admired "the resilience of those recovering from the attacks."

The Tweets came just hours after Red Sox owner John Henry — whose team has a "B Strong" logo in the outfield — finalized the purchase of the Globe.

Lowery declined to comment when reached by the Herald by phone late last night.

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US unemployment aid applications drop to 350,000

WASHINGTON — The number of people seeking U.S. unemployment benefits dropped 12,000 to a seasonally adjusted 350,000 last week, though the total was elevated for the third straight week by technical problems in California.

The Labor Department said Thursday that the less volatile four-week average jumped by nearly 11,000 to 348,250.

Weekly applications have been inflated for the past three weeks, largely because California has been processing a huge number of applications that were delayed because of a computer upgrade. The 16-day partial government shutdown has also lifted claims this month because a number of government contractors were laid off temporarily.

A government spokesman said the backlog in California affected last week's figures but noted shutdown's impact appears to be fading.

Applications have declined for the past two weeks, suggesting California is working through its backlog. And in August, before all the distortions, applications had fallen to pre-recession levels. That indicated companies were cutting very few workers.

Falling applications for unemployment benefits are typically followed by more hiring. But in recent months hiring has slowed, rather than accelerated.

Employers added only 148,000 jobs in September, the government said Tuesday, down from 193,000 in August. The September jobs report was delayed 2 ½ weeks because of the shutdown.

Hiring has slowed since the beginning of the year: Job gains averaged 207,000 from January through March, but fell to 182,000 from April through June and dropped further to 143,000 from July through September.

And hiring likely weakened further in October. Government contractors temporarily laid off workers. Other companies, such as restaurants and hotels located near national parks that were closed, also likely cut jobs.

About 350,000 government workers were temporarily laid off during the shutdown, which ended on Oct. 16. Thursday's report showed that more than 44,000 laid-off federal workers applied for benefits in the week ended Oct. 12, the latest data available. That's down from 70,000 in the previous week. Applications by federal workers, however, are not included in the unemployment claims data.

Most federal workers will have to repay the benefits once they receive back pay, but that varies according to state law.

Nearly 3.9 million people were receiving unemployment aid in the week ended Oct. 5, the latest data available. That's about 70,000 fewer than the previous week.

Many economists estimate the shutdown cut about $25 billion from the economy. Several have lowered their forecasts for growth in the October-December quarter by a half-point to an annual rate of 2 percent or less.

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Time Warner Cable to carry Al Jazeera America

NEW YORK — Time Warner Cable and Al Jazeera America say they've reached a deal for the cable company to start carrying the channel.

Al Jazeera America will be launched over the next six months on digital basic cable services in Time Warner Cable as well as Bright House Networks markets, including New York, Los Angeles and Dallas.

Financial terms were not disclosed.

The deal will make Al Jazeera America available to almost 55 million homes.

Al Jazeera America began broadcasting in August. It has said it wants to provide unbiased, in-depth domestic and global news. But it faces the challenge of overcoming suspicions that some Americans may have about a news organization that is controlled by a foreign government and part of a larger company described by some critics as anti-American.

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Boston Scientific to cut up to 1,500 jobs

NATICK, Mass. — Boston Scientific Corp. plans to shed as many as 1,500 jobs worldwide, or 6 percent of its workforce, in an effort to cut costs.

The company also said Thursday that its CFO is leaving. Boston Scientific is promoting its corporate controller to replace him.

The Natick, Mass.-based medical device maker had already announced up to 1,000 job cuts in January in response to limited growth prospects in certain markets and taxes related to the health care overhaul. That's on top of a 2011 cost-cutting plan that included the elimination of 1,200 to 1,400 jobs. The company has about 24,000 employees.

In the newest plan, it said it will eliminate 1,100 to 1,500 jobs over the next two years through attrition and layoffs. It hopes to trim annual operating expenses by up to $200 million and invest some of the savings in initiatives that will bolster its growth.

The company's shares fell 38 cents, or 3.1 percent, to $11.91 in morning trading. The stock has been trading around five-year highs.

Boston Scientific has not posted a net annual profit since 2005, the year before it made a massive, $27 billion dollar acquisition of implantable defibrillator maker Guidant. The purchase has weighed on the company's balance sheet ever since, even as demand for the heart-zapping implants has declined.

Boston Scientific has also spent years addressing legal allegations about Guidant's handling of problems with its devices. Last week the company agreed to pay $30 million to settle Justice Department allegations that that Guidant knowingly sold defective heart devices to hospitals that implanted them in Medicare patients from 2002 to 2005.

The company said sales of implantable defibrillators and pacemakers improved slightly compared to last year. Boston Scientific and its competitors have suffered through a broader, multiyear slump in use of the heart-shocking devices following a series of recalls that affected all of the major manufacturers. Defibrillators monitor the heart for dangerous irregular heartbeats and use electrical jolts to shock it back to a normal rhythm.

Boston Scientific on Thursday reported a third-quarter loss of $5 million, or break-even per share, compared with a loss of $664 million, or 48 cents per share, in last year's quarter. If one-time items are excluded the company said it earned 17 cents per share. Its revenue was unchanged at $1.74 billion.

Boston Scientific said sales of urology and women's health products, endoscopy products, and neuromodulation devices improved. That countered a decline in sales of heart stents and other products.

The company said CFO Jeffrey Capello will leave Dec. 31 because he wants to find a broader management position. Capello has been Boston Scientific's CFO since March 2010. Daniel Brennan, Boston Scientific's corporate controller and senior vice president, will become its new CFO.

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Obama admin. was responsible for testing

WASHINGTON — The contractors responsible for building the troubled Healthcare.gov website say it was the government's responsibility — not theirs — to test it and make sure it worked.

Lead contractor CGI Federal tells Congress the Obama administration made the call to go live with the insurance website, while the company made no recommendation either way.

Another contractor says the company shared concerns about insufficient testing with the Obama administration.

Andrew Slavitt of QSSI says his company talked in detail about the risks its saw, and passed along those concerns throughout the process.

After the federal website serving 36 states got overwhelmed with technical problems, the administration acknowledged it had not done enough testing.

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Icahn: Apple should launch $150B stock buyback

NEW YORK — Activist investor Carl Icahn has told Apple CEO Tim Cook that the iPhone and iPad maker should launch a $150 billion stock buyback immediately and disclosed that he now owns 4.7 million shares in the company.

In a letter to Cook posted online on Thursday, Icahn said he has increased his stake in Apple by 22 percent from 3.9 million at the end of September. At Apple's current stock price, that's worth about $2.5 billion and amounts to less than a 1 percent stake in the company. He plans to increase his stake.

Icahn wants Apple to launch the buyback at its current stock price, which closed at close to $525 on Wednesday when the letter was sent. He stressed that he does not plan to tender any of his shares in the buyback he is proposing.

"There is nothing short term about my intentions here," he wrote.

A representative for Apple did not immediately respond to a message for comment.

Icahn said he wants to make it "very clear" that he supports Cook and Apple's current management team, as well as Apple's culture and "innovative spirit it engenders." It's just that he believes that Apple's current buyback plan — $60 billion over three years — is too small.

Speaking of his proposal, Icahn wrote, "While this would certainly be unprecedented because of its size, it is actually appropriate and manageable relative to the size and financial strength of your company. Apple generates more than enough cash flow to service this amount of debt and has $147 billion of cash in the bank."

The billionaire investor posted the letter on a new website he launched Thursday, called "Shareholders Square Table."

Shares of Cupertino, Calif.-based Apple rose $1.87 to $526.83 in morning trading.

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Ex-Utah Gov. Huntsman hosting weekly radio show

SALT LAKE CITY — Former Republican Utah Gov. Jon Huntsman, a 2012 presidential candidate, will be hosting a new weekly radio talk show on SiriusXM satellite radio aimed at promoting bipartisan politics.

Huntsman helped launch a similar program in May, but that show was monthly and Huntsman only served as an occasional host.

SiriusXM says in a statement that the company felt the monthly show was a success and decided to expand it to a weekly program with Huntsman.

The new venture, an hour-long program called "No Labels Radio with Jon Huntsman," will air on Saturdays, starting on Oct. 26.

Huntsman is a co-chair of a group of 87 members of Congress called No Labels, which calls for an end to dysfunctional politics and more problem-solving in Washington, D.C.

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FedEx expects increase in holiday deliveries

MEMPHIS, Tenn. — FedEx expects that holiday shoppers will be more nice than naughty this year, with shipments rising from 2012.

The company said Wednesday that it expects to carry more than 22 million shipments on the busiest day of the season, which it believes will be Monday, Dec. 2.

FedEx predicts that shipments in the first week of December will rise 13 percent over last year's peak week, to more than 85 million shipments, driven by online shopping and retailers stocking up on electronics, apparel and other goods.

The expected top day, Dec. 2, will be the first work day for many shoppers after the long Thanksgiving weekend. This is the first time that FedEx expects so-called "Cyber Monday" to be its busiest day of the season.

Last year, the company's heaviest load fell on Dec. 17, when it carried 19.9 million shipments. It also saw spikes of 19.6 million shipments on Cyber Monday and 19 million on Dec. 10.

If FedEx's forecast is correct, the 2013 peak day will be roughly double the volume of its busiest day just six years ago.

The National Retail Federation predicts that retail sales in November and December will rise 3.9 percent over last year to $602 million — $738 per shopper. It expects online sales to rise by 13 percent to 15 percent.

FedEx, United Parcel Service Co. and others will fight over all those deliveries. This week, FedEx rolled out a new service called One Rate, a flat-rate shipping option that it hopes will boost its share of the holiday-shipping business. This spring, it offered a service that allows residential recipients to schedule deliveries.

Memphis-based FedEx Corp. expects to hire slightly more than the 20,000 seasonal workers that it added last year.

In morning trading, FedEx shares fell $1.01 to $128.68.

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WellPoint's 3Q profit falls 5 pct, forecast climbs

INDIANAPOLIS — WellPoint's third-quarter earnings fell 5 percent, but the nation's second-largest health insurer says it is raising its 2013 forecast despite added expenses from the health care overhaul.

The Indianapolis company says it earned $656.2 million, or $2.16 per share, in the quarter. That compares to $691.2 million, or $2.15 per share, last year, when the company had more shares outstanding. Earnings excluding one-time items totaled $2.10 per share.

Operating revenue soared 17 percent to $17.73 billion. That excludes investment gains or losses.

Analysts forecast earnings of $1.81 per share on $17.66 billion in revenue.

The Blue Cross Blue Shield insurer now expects full-year adjusted earnings of at least $8.40 per share, up from a previous forecast for at least $8.

WellPoint shares are falling in morning trading.

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176-year-old Fall River business closing

FALL RIVER, Mass. — A 176-year-old Fall River masonry supply business is shutting down, a victim of the changing face of the city.

Owner Winthrop Sanford says Building Materials Inc. will close for good on Oct. 31. It specializes in bricks, mortar and stone.

He tells the Herald News (http://bit.ly/163BFNE ) he has seen the business's demise coming for years, as the city's mills closed and retail customers moved to the suburbs.

He says there used to be 40 to 50 masons in the city. Now there are four or five.

The company was founded in 1837 and has been in Sanford's family since 1900.

At its height right after World War II, the company employed about 40 people. In the last decade it has had six to eight employees.

___

Information from: The (Fall River, Mass.) Herald News, http://www.heraldnews.com

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ECB launches major review of banks

FRANKFURT, Germany — The European Central Bank is launching a review of 128 of the eurozone's biggest banks, a push to restore faith in the financial system — and lay the groundwork for growth — after similar studies fell short.

The review will be a key test of the ECB's credibility as it prepares to take over as the European Union's banking supervisor. Previous stress tests carried out in 2009 and 2011 by another agency with more limited powers, the European Banking Authority, cleared several banks that were in need of rescuing soon after.

Europe's slow progress in cleaning up the banks contrasts with the United States. There, officials moved early to make banks strengthen their financial buffers in the wake of the 2008 collapse of investment bank Lehman Brothers.

The ECB announced Wednesday that its review of the banks will begin next month and take a year. Working with national regulators, ECB officials will take a broad look at the banks' holdings and financial strength. In particular, they will look for hidden losses such as loans to businesses and real estate projects that are unlikely to be repaid.

ECB President Mario Draghi called it "an important step forward for Europe and for the future of the euro area economy."

The ECB's review will be followed by a stress test that would simulate bank losses in a sudden economic downturn or financial crisis, conducted along with the European Banking Authority.

The question is whether that stress test will be more credible than the previous ones.

Thomas Huertas, a partner in a unit of Ernst & Young, said they probably would because the ECB will have already reviewed the banks' balance sheets before conducting the test — something the EBA was not able to do before.

At the end, banks could be pushed to repair their finances by raising more capital or selling off risky holdings.

The issue is import for Europe's recovery because banks that are holding soured investments, such as bad loans, may be unable or unwilling to find cash to lend to businesses that need credit to expand their operations. They may also be asking for higher interest rates to lend, blunting the ECB's ability to stimulate the economy with lower borrowing costs.

The eurozone grew only 0.2 percent in the second quarter after contracting for six quarters and unemployment remains high at 12 percent.

The asset review and stress test need to be done before the ECB takes over as the European Union's banking supervisor next year. The single supervisor is part of a broader effort to strengthen the financial system and prevent a repeat of the debt problems afflicting countries such as Spain and Ireland, where bank bailouts hurt government finances.

Ignazio Angeloni, an ECB official, said the result would call for "repair where repair is necessary" and won't necessarily include a figure for raising new capital.

The ECB's job may be complicated by the fact that Europe does not yet have a single authority to restructure or shore up banks that review identifies as weak. European leaders are still debating how to set up such an authority. If banks cannot raise new capital from private investors, they could turn to their national authorities. Under some circumstances, the eurozone's bailout fund could be used, but the idea has faced stiff political resistance from governments.

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Bacteria found in breast milk sold on Internet

CHICAGO — Human breast milk is sold for babies on several online sites for a few dollars an ounce, but a new study says buyer beware: Testing showed it can contain potentially dangerous bacteria including salmonella.

The warning comes from researchers who bought and tested 101 breast milk samples sold by women on one popular site, which over the weekend said it was making changes to its policies. Three-fourths of the samples contained high amounts of bacteria that could potentially sicken babies, the researchers found.

The results are "pretty scary," said Dr. Kenneth Boyer, pediatrics chief at Rush University Medical Center in Chicago, who was not involved in the study. "Just imagine if the donor happens to be a drug user. You don't know."

The research published in medical literature cites several cases of infants getting sick from strangers' milk.

Breast milk is also provided through milk banks, whose clients include hospitals. They also charge fees but screen donors and pasteurize donated milk to kill any germs.

With Internet sites, "you have very few ways to know for sure what you are getting is really breast milk and that it's safe to feed your baby," said Sarah Keim, the lead author and a researcher at Nationwide Children's Hospital in Columbus, Ohio. "Because the consequences can be serious, it is not a good idea to obtain breast milk in this way."

The advice echoes a 2010 recommendation from the federal Food and Drug Administration.

"When human milk is obtained directly from individuals or through the Internet, the donor is unlikely to have been adequately screened for infectious disease or contamination risk," the FDA says. "In addition, it is not likely that the human milk has been collected, processed, tested or stored in a way that reduces possible safety risks to the baby."

The researchers believe theirs is the first study to test the safety of Internet-sold milk, although several others have documented bacteria in mothers' own milk or in milk bank donations. Some bacteria may not be harmful, but salmonella is among germs that could pose a threat to infants, Boyer said.

Sources for bacteria found in the study aren't known but could include donors' skin, breast pumps used to extract milk, or contamination from improper shipping methods, Keim said.

The study was published online Monday in the journal Pediatrics.

The researchers attempted to buy milk from women on two websites but only tested milk obtained from women on one site, onlythebreast. An unidentified administrator for that site issued a statement saying the Incline Village, Nev.-based company is planning to stop informal milk sharing and will seek to improve donor screening and pursue "professional milk processing." The website appeared to be down Monday morning.

There are many milk-sharing sites online, including several that provide milk for free. Sellers or donors tend to be new mothers who produce more milk than their own babies can consume. Users include mothers who have difficulty breast-feeding and don't want to use formula and people with adopted infants.

Breanna Clemons of Dickinson, N.D., is a donor who found a local woman who needed breast milk through one of the online sites where milk is offered free.

"A lot of people are like, 'Ewww, it's weird,' but they haven't been in a situation where they didn't want their child to have formula," or couldn't produce enough milk, Clemons said. She said she shared her medical history with the recipient.

Clemons is breast-feeding her 7-month-old and stores excess milk in her freezer. Every few weeks, she meets up with the recipient and gives her about 20 6-ounce bags. Clemons said the woman has a healthy 9-month-old who "loves my milk."

Keim said it's unclear if milk from sites offering free donated milk would have the same risks because donors might be different from those seeking money for their milk. And in a comparison, the researchers found more bacteria in breast milk purchased online than in 20 unpasteurized samples donated to a milk bank.

Bekki Hill is a co-founder of Modern Milksharing, an online support group that offers advice on milk donation. She said there's a difference between milk sellers and donors; milk donors "don't stand to gain anything from donating so they have no reason to lie about their health."

Hill, of Red Hook, N.Y., used a donor's milk for her first two children and plans to do so for her third, due in February, because she doesn't produce enough of her own.

"Breast milk is obviously the preferred food" for babies, she said.

___

Online:

Pediatrics: http://www.aap.org

___

Follow AP Medical Writer Lindsey Tanner at http://www.twitter.com/LindseyTanner .

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SAP co-CEO: Cloud computing growth continues

FRANKFURT, Germany — The co-CEO of business software maker SAP AG says the company's strong growth in cloud computing remains on track — despite headwinds from a stronger euro.

Bill McDermott told the Associated Press on Monday that SAP "is the fastest growing cloud story in the enterprise software world."

Revenue from cloud computing — where companies use software based at servers instead of at their own offices — more than tripled in the third quarter, to 191 million euros ($261 million) from 63 million euros a year earlier.

Net profit rose 23 percent. Revenue from the company's older, on-site software business slipped 5 percent — but grew 2 percent when excluding the impact of exchange rate shifts.

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Survey: US economists upbeat on economic growth

Despite uncertainty in Washington and rising oil prices and interest rates, companies are upbeat on the prospects for economic growth in the next year, according to a quarterly survey of business economists.

But economists surveyed by the National Association for Business Economics weren't as optimistic about hiring, according to the survey released Monday. Only 27 percent reported rising employment at their firms from July through September, down from 29 percent in the second quarter. And 37 percent expected their companies to expand payrolls in the next six months, down from 39 percent in the second quarter.

The slower hiring occurred even as sales and profit margins grew during the third quarter, according to the survey.

Still, optimism about future economic growth remained strong last quarter. Almost 70 percent of the economists in the survey predicted gross domestic product growth of 2-to-3 percent, with another 19 percent expecting growth of 1-to-2 percent. The figures are nearly identical to those from the second-quarter survey, released in July.

The U.S. economy grew at a 2.5 percent annual rate from April through June, an improvement from the first three months of the year. But many economists worry that the growth rate may be slowing.

The NABE surveyed 60 of its member economists between Sept. 16 and Oct. 1, with most of the survey finished prior to the partial government shutdown that began Oct. 1. The economists work for companies from a variety of industries, including manufacturing, transportation and utilities, finance, retail and other services.

Among the findings:

— Sales growth accelerated in the third quarter. Forty-two percent of the economists reported rising sales at their companies, up from 35 percent in July. Only 12 percent reported falling sales, down from 15 percent in July.

— Profit margins also rebounded. One-third of the economists said margins were up at their firms, up from 21 percent in July and the highest percentage in more than a year. Those reporting falling profit margins fell to 19 percent, down from 25 percent in the second quarter.

— Only 16 percent of economists said their firms were raising wages and salaries, down from 19 percent in July and 31 percent in April.

— Most economists, 81 percent, said the Affordable Care Act had no impact on employment during the past three months. But a "sizeable minority," 18 percent, reported a negative impact. And 22 percent expected a negative impact on employment in the next year, compared with only 2 percent expecting a positive impact. The responses also suggested a small shift toward more part-time and fewer full-time employees, according to the survey.

— Most economists, 80 percent, reported no impact on their businesses in the third quarter from rising long-term interest rates, according to the survey.

But a quarter of the economists expect rising interest rates and increasing oil prices to drag on sales during the next 12 months.

Twenty-five percent expect a negative impact from rising rates, but 62 percent expect no impact.

Also, 25 percent of panelists expect rising oil prices to hurt sales in the next year more than in the past three months, but a majority, 64 percent, expects no impact.

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Markets flat-footed at start of busy week

LONDON — Financial markets were flat-footed Monday at the start of a busy week that will see a number of key economic releases published and the U.S. corporate earnings reporting season pick up steam.

Oil was the standout mover as the benchmark rate briefly fell below $100 a barrel for the first time since early July.

Most attention in recent weeks has centered on the prolonged stalemate in Washington to raise the country's debt ceiling and reopen the government. Now that a deal has been agreed, albeit a short-term one, investors can focus on other matters, such as the underlying health of the global economy and when the Federal Reserve will start reducing its monetary stimulus.

During the partial U.S. government shutdown of recent weeks, much of the U.S. economic data was postponed. With the government now functioning fully, many of those data reports will be released over the coming days, including September's nonfarm payrolls figures. That's due on Tuesday and could provide investors a steer as to when the Fed will start reducing its $85 billion-worth of monthly asset purchases.

In addition, investors will be monitoring the next round of earnings, particularly out of the U.S. — around 30 percent of the S&P 500 is due to unveil reports this week. Monday's batch were fairly mixed — while McDonald's confirmed that it faces greater competition, shifting eating habits and tough economic conditions around the world, toy maker Hasbro saw its share price spike sharply after reporting better-than-expected results.

"Investors are again focusing on fundamental matters, particularly in the form of earnings," said Dan Greenhaus, chief strategist at BTIG in New York. "A number of issues remain equity supportive, indicating higher prices ahead. These include ongoing earnings growth, seasonality and a Federal Reserve that very well may stay accommodative until January if not March."

In Europe, the FTSE 100 index of leading British shares was up 0.3 percent at 6,646 while Germany's DAX was flat at 8,864. The CAC-40 in France was 0.3 percent lower at 4,275.

In the U.S., the Dow Jones industrial average was down 0.1 percent at 15,386 while the broader S&P 500 index was flat at 1,744. Last week, relief over the U.S. debt ceiling helped the S&P hit an all-time high.

Earlier, Asian markets were fairly buoyant after Friday's solid session in the U.S., where stocks were boosted by unexpectedly strong profits from General Electric Co., Morgan Stanley and other companies. Google surged nearly 14 percent, topping $1,000 a share for the first time.

Japan's Nikkei 225 index rose 0.9 percent to 14,693.57 while China's benchmark Shanghai Composite Index added 1.6 percent to 2,229.24. Hong Kong, Seoul and Sydney also rose.

In the currency markets, trading was lackluster. The euro was down 0.1 percent at $1.3675 — on Friday, it rose above $1.37 for the first time since February, largely because of the dollar's weakness in the wake of the debt ceiling crisis.

In the oil markets, a barrel of benchmark New York crude was down 64 cents at $100.48 a barrel. Earlier it had fallen below $100 for the first time since early July to $99.64 a barrel.

"The ample and rising supply of oil, combined with weaker demand growth prospects, point towards lower prices in the months ahead," said Fawad Razaqzada, a technical analyst at GFT Global Markets.

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US existing-home sales drop 1.9 pct. in September

WASHINGTON — Americans bought fewer existing homes in September than the previous month, held back by higher mortgage rates and rising prices.

The National Association of Realtors said Monday that sales of re-sold homes fell 1.9 percent last month to a seasonally adjusted annual rate of 5.29 million. That's down from a pace of 5.39 million in August, which was revised lower.

The sales pace in August equaled July's pace. Both were the highest in four years and are consistent with a healthy market.

Mortgage rates rose sharply over the summer from their historic lows, threatening to slow a housing recovery that began last year and has helped drive modest economic growth.

But many economists expect home sales will remain healthy, especially now that rates have stabilized and remain near historically low levels. Final sales in September reflected contracts signed in July and August, when rates were about a percentage point higher than in May.

The average rate on a 30-year fixed mortgage was 4.28 percent last week, down from a two-year high of 4.58 percent in August. That's also far below the 30-year average of 7 percent, according to Bankrate.com.

Sales of existing homes have risen at a healthy 10.7 percent in the past 12 months. Still, that's the slowest year-over-year increase in five months.

And the median home price has risen 11.7 percent in the past year, the Realtors said. That's also the slowest annual gain in the past five months.

Price increases may be slowing because more homes are finally coming on the market. The supply of available homes rose 1.8 percent from a year ago to 2.21 million, the first year-over-year increase in 2 ½ years.

The limited number of homes for sale is a key reason prices have risen so fast in the last year.

The economy is growing modestly and employers are adding jobs at a slow but steady pace. That's helped a growing number of Americans buy homes.

Still, many first-time buyers have been unable to enter the market. They made up just 28 percent of purchases in September, down from 32 percent a year ago. In healthier housing markets, they typically make up at least 40 percent of buyers.

First-time buyers are having trouble qualifying for loans because many banks have adopted tougher lending restrictions and higher down payment requirements since the housing bubble burst. .

In their place, investors and Americans willing to pay cash are playing an outsize role in sales. Cash purchases made up 33 percent of September's sales, up from 28 percent a year ago.

Borrowing rates began to rise in May after Federal Reserve Chairman Ben Bernanke suggested that the Fed could start to slow its monthly bond purchases by the end of the year. The purchases are intended to keep interest rates low and stimulate the economy.

But the Fed decided against slowing its purchases at its September meeting, citing weak economic data and looming budget battles in Washington. The budget fights led to a partial government shutdown Oct. 1. The nation's borrowing limit was increased but only at the last minute. Economists have cut their forecasts for growth in the October-December quarter by about a half-percentage point because of the shutdown and debt limit fight.

As a result, many economists think the Fed won't slow its bond purchases until January or even later. That's likely to keep mortgage rates low well into the new year.

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AP CEO: Press freedom v. security a 'false choice'

DENVER — Governments that try to force citizens to decide between a free press and national security create a "false choice" that weakens democracy, and journalists must fight increasing government overreach that has had a chilling effect on efforts to hold leaders accountable, the president and CEO of The Associated Press said Saturday.

Gary Pruitt told the 69th General Assembly of the Inter American Press Association that the U.S. Justice Department's secret seizure of records of thousands of telephone calls to and from AP reporters in 2012 is one of the most blatant violations of the First Amendment to the U.S. Constitution the 167-year-old news cooperative has ever encountered.

The Justice Department action involving the AP resonated far beyond the U.S., including Latin America, where journalists for decades have fought to exercise press freedoms under authoritarian regimes, Pruitt said.

"The actions by the Department of Justice could not have been more tailor-made to comfort authoritarian regimes who want to suppress the news media. 'The United States does it too,' they can say," Pruitt said.

A free and independent press "differentiates democracy from dictatorship; separates a free society from tyranny," he said.

"Governments who try to set up a situation where citizens think they must choose between a free press and security are making a mistake that will ultimately weaken them, not strengthen them. It's not a real choice. It is a false choice."

Pruitt said he was encouraged by proposed Justice Department guidelines, introduced after the records seizure, that would give news media advance notice of subpoenas so the press can challenge those actions in court; protect not just phone records but reporters' email, text messages and other forms of electronic communication; and guarantee that journalists won't be prosecuted for doing their jobs.

"But you can bet that we will be watching closely to make sure they are implemented and enforced," Pruitt said.

In 2012, the Justice Department secretly obtained records of work, cell and home numbers of AP journalists, as well as AP bureau numbers in New York, Washington, D.C., Hartford, Conn., and the AP number in the U.S. House of Representatives press gallery. It did so after an Associated Press story revealed the foiling of a plot in Yemen to bomb a U.S.-bound airliner at a time the Barack Obama administration was insisting publicly that it had no information about terrorist organizations plotting attacks on the United States in that period.

The Justice Department was trying to identify who leaked information for the AP story — but it didn't tell the AP about its phone records seizure until a year after the story ran.

The seizure was "hardly a surgical strike on a few carefully chosen targets. It was overbroad, sloppy and a fishing expedition into a wide spectrum of AP news journalism and journalists — most of whom had nothing to do with the issues in question here," Pruitt said.

It also differed from the National Security Agency's broad monitoring of global communications because it was specifically directed at locating the source of AP's reporting.

Just as alarming, the seizure has intimidated both official and nonofficial sources from speaking to the AP and numerous other news organizations, even about stories not related to national security, Pruitt said.

"Now, the government may love this. I think they do. But beware a government that loves secrecy too much," he said.

And the challenge isn't going away, Pruitt said.

"The attack on journalism — here in the United States and throughout the rest of the world — is not going to cease any time soon. In fact, I think it will become even more difficult to counter as technology gives governments very powerful tools to monitor the actions and communications of citizens and journalists," he said.

The Miami-based Inter American Press Association has about 1,400 member news organizations and promotes press freedoms throughout the Americas.

___

English URL: www.ap.org/content/press-release/2013/the-free-press-vs-national-security-a-false-choice

Spanish URL: www.ap.org/content/press-release/2013/libertad-de-prensa-vs-seguridad-nacional-un-falso-dilema

Portuguese URL: www.ap.org/content/press-release/2013/imprensa-livre-vs-seguranca-nacional-a-falsa-escolha

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Massport to hit up pols

Massachusetts Port Authority officials — already facing a ticking clock to grab vital federal funding — are prepping to start a Beacon Hill blitz this week to pitch a $300 million plan to dredge Boston Harbor, hoping to convince lawmakers to bankroll nearly a quarter of it.

The four-year project to deepen the Hub's vital maritime channels could double the amount of cargo containers that pass through Boston Harbor — a 
$42.5 million business for Massport last year — and will help it vie for the bigger cargo ships primed to hit East Coast ports starting in 2015, officials say.

But they admit they're already playing catch-up to other ports' dredging projects, making lobbying efforts — both federally and at the state level — crucial to keeping them competitive.

"We want to make sure we're putting our best foot forward and make the case for federal funding, and make the case for state funding. But it's kind of a chicken-and-egg process," Massport CEO Thomas Glynn said, noting the board has yet to vote on the project but could within four months. "We have to tell the board, then we have to go to the State House, so we kind of go back and forth."

Their first targets are East Boston lawmakers, whose sometimes prickly history with the agency mean Massport pitches always require a grain of salt, said Eastie state Rep. Carlo Basile.

"I just don't take their word for it. I do my own due diligence," said Basile, who plans to meet with Massport officials Tuesday. He admitted he's aware of little to no complaints from past dredging projects rolled out in 2001, 2005 and 2008, but warned, "that's not to say it can't happen this time."

"It's a much bigger project," Basile said. "I'm still waiting to hear a lot of details."

Massport spokesman Matthew Brelis, said, "We talk with legislators all the time on a host of things," but noted for the dredging project officials are starting with lawmakers from "impacted communities" before moving on to others.

Massport officials are counting on as much as 
$170 million in federal money for the project, with $65 million each coming from the agency and the state.

Secretary of Transportation Richard Davey, who chairs the Massport board, implored members that "we shouldn't do anything right now that would preclude us from the $170 million," likening the shot at the federal funds to waiting for Halley's Comet.

"You can call it Davey's Comet," he told the board during a Thursday meeting.

When Congress will act to award the money, however, is unclear, especially in the wake of the government shutdown, Glynn said.

"Everything is up for grabs down there until it's final," he said. "(Other ports) are a little bit ahead of us in terms of making their request ... but we have enough time. It's a question of it's a moving target."

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Shutdown coverage benefits cable news networks

NEW YORK — The federal government shutdown damaged the reputations of Washington politicians but proved good business for the cable television news networks — and taught some reporters new benefits of virtually instant communications.

CNN, Fox News Channel and MSNBC saw their viewership increase during the 16-day partial shutdown, peaking at more than five million Wednesday evening when Congress passed a compromise bill to put the government back online.

"It was a drama," said CNN congressional correspondent Dana Bash, who logged many hours of airtime along with Kelly O'Donnell of NBC News and Mike Emanuel of Fox. "Whenever there's a drama, people are interested."

MSNBC, which has struggled in this post-election year, saw its average prime-time viewership jump 35 percent to 978,000 this month through Wednesday, compared to the first nine months of the year, the Nielsen company said. Fox, which chose not to make any of its reporters available for this story, was up 9 percent to 2.22 million in the same period (although the network also benefited from a prime-time schedule change this month). CNN improved by 11 percent to 721,000.

The news networks brought their traditional hallmarks of crisis coverage to the political machinations, including "countdown clocks" that marked each second closer to a debt limit deadline. The story meant brutal hours: O'Donnell, who filed for MSNBC, CNBC and NBC News, was at work past 3 a.m. Eastern the first night of the shutdown, then back at 6 a.m. for "Morning Joe."

There were many strong points to the coverage, particularly when reporters didn't fall back on cliches like declaring winners and losers for an event that did few people proud, said Jane Hall, a journalism professor at American University.

"It certainly gave voice to the American people disgusted over this and there were a number of good stories about the impact of the shutdown on government workers," Hall said.

Social media was a big help, O'Donnell said. She would hear from people outside the Capitol cocoon through Twitter and email, with many raising questions she used in her reporting. She was asked how the shutdown would affect Social Security or back pay for government workers. NBC used a "dearcongress" hashtag on Twitter to encourage questions.

Sometimes the concerns were very specific, like when shrimp fishermen asked about access to launches on federal land, which she took to an individual congressman in the affected area.

"That was a real-time experience of the shutdown that did not compare to anything in a crisis that we had covered before," O'Donnell said.

In the past, Bash said she'd often need to plead with producers for time off the air to report. In this case, it wasn't really necessary: Her sources would text, tweet or email information while she was on the air. When President Barack Obama spoke to the nation on Thursday, Bash had instant reaction from several Republicans minutes after he left the podium.

When Republicans and Democrats weren't talking to each other, Bash found that they would talk through her.

"I'll report something or I'll tweet something and I'll get a call from a source pushing back or trying to shape it — not because it's a message to the world, but because it's a message to the other side," she said.

Bash would set up live shots in the hallway between Speaker John Boehner's office and the floor of the House of Representatives, a passageway teeming with sources.

Even though TV reporters love few things more than airtime, by the end even that was wearing off.

"There's always a rush in covering a big story," Bash said. "But at a certain point, you want your government to work a little better, regardless of what you do for a living."

___

EDITOR'S NOTE — David Bauder can be reached at dbauder@ap.org or on Twitter@dbauder. His work can be found at http://bigstory.ap.org/content/david-bauder.

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Startup has skin in the game

A Colombian company offering new hope to burn victims and other patients who suffer skin tissue loss is one of the 26 MassChallenge top finalists who'll compete on Oct. 30 for a piece of the start-up accelerator's $1.5 million in cash prizes.

Keraderm was founded in Bogota in 2010 by a group of plastic surgeons, who set out to find an affordable, painless way of treating tissue loss resulting from burns, ulcers, tumors and trauma.

The typical treatment calls for a graft to be taken from a patient's healthy skin and meshed to cover a large wound — a surgical procedure that often results in severe pain, significant scarring and, sometimes, rejection by the patient's body.

But Keraderm's team found that by taking a sample of healthy skin less than one centimeter in diameter from behind a patient's ear, within five to seven days they could reproduce the skin cells and plant them on a collagen sheet four times the size of a business card to cover the wound, said Jorge Soto, the company's chief financial officer.

"It starts to heal the injury by accelerating the growth of healthy skin cells," Soto said. "In 20 to 40 days, the wound is completely healed."

The patent-pending procedure, which eliminates the need for an operating room and anesthesia as well as the possibility of rejection, has been successfully done on more than 100 patients so far in 11 different hospitals in Colombia and entails no pain or scarring, he said.

A 10-by-10-centimeter sheet of skin also costs $550, significantly less than a skin graft operation does.

"There are other variations of what we're doing," Soto said, "but we haven't been able to find anyone doing the same thing."

Keraderm hopes to expand the procedure in Latin America before bringing it to the United States, where it would need to be tested in a clinical trial to gain regulatory approval.

That's a process that would take the kind of money the company, which has only eight employees including Soto, does not yet have, he said.

The team bootstrapped the start-up with $50,000 and in 2012 raised an additional $300,000 from angel investors, allowing it to open a lab in Bogota that June, Soto said.

But even if Keraderm doesn't win any money in MassChallenge, he said, the four-month accelerator, for which they were selected out of a field of nearly 1,200 applicants, has been worth it.

"I never even thought I was going to be here," Soto said. "It's going to help me a lot to show we have a product that is working."

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What to do when battery is on its last legs

I have a 2005 Hyundai Tucson with 90,000 miles on it. I've never had a problem since I purchased the vehicle, but I'm worried the battery will fail sometime soon because of its age. I'm planning to change the battery myself but I'm concerned about the computer and electronics due to the temporary loss of power during the replacement process. What should I do before and after changing the battery?

Just drive the car. Replacing the battery, which of course requires disconnecting the vehicle's electrical system from the original battery, will do no harm to the vehicle's electronics. You'll likely have to reset the radio station pre-sets and the engine management system will take a few miles of driving to "re-learn" your driving characteristics, but you probably will not notice anything.

Perhaps the more relevant question at this point is: Should you replace the battery now or wait until it fails? Being a founding member of the "Snug America" club and not wanting to part with any more of my hard-earned dollars than absolutely necessary, I lean toward the latter. Most batteries will develop symptoms of impending failure such as slow engine cranking speeds, giving you a heads-up that it's time for a new one. But batteries can and do fail suddenly and completely without warning.

So when I suspect a battery might be on its last legs, I carry a portable battery booster in the vehicle. Then, if the battery does fail, — at any time and for any reason — I can jump-start the vehicle to complete my trip.

This, by definition, is the Murphy's Law of automobiles — if you have a spare part with you, you'll probably never need to use it!

And finally, to put your mind at ease, have the original battery tested at a local parts store. A load test or electronic test will give you an idea of how much life your battery still has.

I have a '93 Buick Riviera with the 3800 V6 engine and 182,000 miles. When I start the engine it makes a "thudding" noise four to five times. It has done this intermittently for the past three years. One mechanic told me it could be a cracked flywheel. Can you help?

Does this noise primarily occur on a cold start after the car's been sitting for at least several hours? Also, watch the oil pressure warning light carefully as you start the engine — do the "thuds" last precisely until the warning light goes out? If so, the noise may be due to worn main or rod bearings. Once oil pressure is up, the excess clearance is buffered by the oil film and the noise stops.

A cracked flex plate/flywheel or loose torque converter mounting bolts could cause a similar noise, but for three years without some type of failure? Other possibilities include a broken or failed engine/drivetrain mount or an engine startup misfire.

Regardless of the cause, at 20 years old and nearing 200,000 miles, I'm not sure I'd be willing to spend much on repairs. If the vehicle is still nice, keep an eye out for a used or rebuilt engine. Remember the automotive version of Murphy's Law.

We have a 2008 Buick Lucerne. This fall we will be leaving the state for about seven months. Should we disconnect the battery? Will this mess up the computers? Also, should I use a trickle charger or a float charger? What's the difference?

I recommend disconnecting the battery — it is safer and will cause no harm as described above — and connect a float charger or battery maintainer like Battery Tender to keep the battery safely charged while you're away.

A trickle charger continuously charges the battery at a low amperage rate, which can lead to overcharging and battery failure. A battery maintainer charges and holds the battery at its optimum voltage safely for an indefinite period.

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