March 12 - Crain`s Cleveland Business

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March 12 - Crain`s Cleveland Business
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$2.00/MARCH 12 - 18, 2012
VOL. 33, NO. 11
Business groups
don’t rally for
right to work
Tepid response to issue may be due to
wounds from collective bargaining fight
By JAY MILLER
[email protected]
Mayor Jackson warns that Cleveland’s
schools could become wards of the state
if Columbus doesn’t clear way for his
School Transformation Plan
By JAY MILLER and TIMOTHY MAGAW
[email protected], [email protected]
I
f he doesn’t get the state legislation he believes is needed to
rebuild Cleveland’s schools,
Cleveland Mayor Frank Jackson
says the likelihood of passing a school
levy this fall “is little or none, and the
guarantee is (that the school district)
will go into academic receivership
and financial bankruptcy.”
Mayor Jackson’s dire words come
as he awaits a decision by Gov. John
Kasich on what legislation the governor will propose to clear the way for
what is called the School Transformation Plan. The mayor and schools
CEO Eric Gordon have proposed the
plan to bring about dramatic change
in the Cleveland Metropolitan School
District.
Mayor Jackson said in an interview
last Thursday, March 8, with Crain’s
that he expects Cleveland’s teachers
to support this plan, despite complaints from the Cleveland Teachers
The idea of overturning a state
law that forces workers to pay union
dues as a condition of employment
in a unionized workplace long has
been favored by business groups in
Ohio. But few groups nor Gov. John
Kasich are rushing to back an effort
to get what often is called a right-towork constitutional amendment on
the statewide ballot, even though a
recent poll of Ohio voters suggests a
majority would support it.
Call it the Issue 2 effect.
Many business groups that in the
past have been early and active
proponents of major state issues,
such as casino gambling, made cautious statements last week to Crain’s
about the proposed right-to-work
amendment, despite the recent
passage of comparable legislation
in nearby Indiana.
“We won’t even begin to take a
look at it until it’s on the ballot and
it’s scheduled for a vote,” said Linda
Woggon, executive vice president
for governmental affairs at the Ohio
Chamber of Commerce. “Then we’ll
run it through our process.”
The right-to-work issue also isn’t
on the radar of the Greater Cleveland Partnership, said Joe Roman,
CEO of the regional chamber of
commerce group, which has more
See WORK Page 17
INSIDE
Web developers’ new tool
built for multimedia wave
HTML5 is offering Northeast Ohio developers a better
way to incorporate animation and other multimedia into
websites, which in turn will make those sites
more mobile-friendly. PAGE 3
ALSO:
■ Spire contractors under fire, too. PAGE 3
See SCHOOLS Page 17
Interest grows in redeveloped Parma GM plant
By STAN BULLARD
[email protected]
MARC GOLUB
0
NEWSPAPER
74470 83781
7
11
Joseph Greenberg last year bought the former Parma General Motors complex.
Redevelopment efforts at Parma’s
former General Motors transmission plant
are shifting into drive.
Workers recently finished removing
tons of equipment from the 525,000square-foot plant, which under dimmerthan-normal auxiliary lighting resembles
a smooth-floored Mammoth Cave. Also
gone is a canopy as long as a football field
that sheltered workers bound to or from
parking lots across Chevrolet Boulevard.
The canopy stretched over part of a site
that rivals a small farm in size; that land
once was set aside for plant expansion,
but now is earmarked for a business park.
Most importantly, the first tenant just
took up residence in what’s called Parma
Business Park II. Late last month, All Pro
Freight Systems of Avon leased 150,000
square feet for a distribution center for a
customer, according to Chris Haas, All Pro
CEO.
The lease is a sign of strong interest in
the property, said Joseph Greenberg, the
broker as well as an owner of 54 Chevy
LLC, which bought the complex last year.
He sees the property as a site for today and
tomorrow.
For today, the plant’s tall ceilings, overhead crane and indoor rail spur will suit
companies that want space immediately,
Mr. Greenberg said. Meanwhile, the vacant
land will yield sites for businesses that
want to build when demand for construction rebounds.
See PARMA Page 17
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3/9/2012
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
PSST ...
COMING SOON
Crain’s Who to Watch: Finance
We’re looking to profile some of the
region’s finance and banking up-and-comers in “Who to Watch: Finance,” a special
section slated for publication April 23.
If you think you know who will be
among those leading the Northeast Ohio
finance scene of the future, drop an email to Amy
Ann Stoessel, [email protected], or call 216771-5155. Please send in your suggestions by
March 26.
MARCH 12 - 18, 2012
There are no hard and fast requirements for possible inclusion in this section, other than the candidate needs to
have exhibited the kind of potential that
makes him or her someone to watch.
And mark your calendars and keep
thinking about the region’s future leaders, as there
will be two more of these sections in 2012: “Who to
Watch: Health Care,” July 16; and “Who to Watch:
Law,” Nov. 26.
Advertising and marketing executives are a chatty
bunch — especially about each other. A recent survey
by The Creative Group of 500 U.S. advertising and
marketing executives found nearly two-thirds of
respondents said it’s “very common” or “somewhat
common” for employees at their agency or firm to
engage in office gossip. Most of them, though, said
the lunchroom/hallway whispering is harmless. Here’s
how they characterized the general tone of gossip
where they work:
Tone
Percentage
Inoffensive and light-hearted
REGULAR FEATURES
Big Issue ..................................10
Classified ................................18
Editorial....................................10
From the Publisher ..................10
Going Places ............................12
Letters ....................................11
List: Credit Unions ....................16
Reporters’ Notebook ................19
61%
Negative; not intentionally hurtful
20
Malicious or hurtful
2
Don’t know
17
SOURCE: WWW.CREATIVEGROUP.COM
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20120312-NEWS--3-NAT-CCI-CL_--
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MARCH 12 - 18, 2012
Developers
speak same
language
with HTML5
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
Contractor
feels sting
of Spire’s
money lag
INSIGHT
Change allows easier
use of multimedia,
among other benefits
Hughes-Roller supplier files suit;
larger group considers next step
By CHUCK SODER
[email protected]
Two years ago, David Skorepa
started telling his clients that a big
change was coming.
Well, it’s here.
Web developers from Northeast
Ohio to Silicon Valley are changing
the way they build websites because
of HTML5 — a set of standards
designed to make website development
easier in a mobile, multimedia world.
The transition is moving fast. In
early 2011, Aztek Consulting Corp.
rebuilt its own website with basic
HTML5 features, said Mr. Skorepa,
chief creative officer for the Cleveland company. By fall of that year, it
was doing the same for clients.
Now, more than half the websites
on which Aztek works incorporate
elements of HTML5 and related
technologies, Mr. Skorepa said.
“It really is the way things are
going,” he said.
HTML5 represents a structural
change in how the web works. The
term technically is used to describe
the fifth generation of changes made
to Hypertext Markup Language, or
HTML, the main tool used to organize content on websites. However,
it also is used as an umbrella term to
include other recent changes made
to web standards, such as Cascading
Style Sheets, which are used to
control colors, fonts and other visual
elements of websites.
Among other things, the changes
allow developers to incorporate animation, video and other multimedia
elements into websites without
using software tools such as Flash,
which has been criticized for using
too much processing power and
exposing web users to viruses.
The late Steve Jobs cited those
problems and others in an April 2010
letter describing why Apple doesn’t
allow iPhones and iPads to access
Flash software.
3
By JOEL HAMMOND
[email protected]
The new standards also give web
Spire Institute’s failure to pay millions of dollars due
its contractors is putting a squeeze on Hughes-Roller
Building Co. of Ashtabula, a lead contractor at the 160acre sports complex in Harpersfield Township.
Hughes-Roller, which last Dec. 19 filed an $8.57
million mechanic’s lien against Spire, is the object of 21
liens filed against it from last October through Feb. 27.
Those liens total $6.13 million.
In addition, Hughes-Roller has been sued for
$570,000 by aluminum contractor Corporate Glass of
Erie, Pa., which took that action instead of filing a lien.
Crain’s reported last Monday, March 5, that contractors had filed a half-dozen mechanic’s liens as of Feb.
27 in the Ashtabula County Recorder’s Office against
Spire, which is part of the Geneva area Recreational,
Educational and Athletic Trust.
The liens totaled $11 million.
“People have
Other mechanic’s liens
lost houses
filed in Ashtabula County are
piling up against various
and equipment.
contractors that have been
It’s very hurtinvolved with work at Spire.
ful. It has the
Besides the liens against
potential of
Hughes-Roller, liens also have
been filed against Corporate
putting us out
Glass, Metcalf Glass of Ashtabof business.”
ula, J.W. Precision Interiors
– David Nolan,
and HAVE Inc., an Ashtabula
owner, Nolan Door
mechanical contractor.
David Nolan, owner of
Nolan Door in Austinburg, Ohio, has filed liens for
$96,096 against Corporate Glass and $161,078 against
Hughes-Roller. Mr. Nolan and Chris Osborne, a project
manager at Corporate Glass, each said Hughes-Roller
offered their companies a token payment after Jan. 1;
for Corporate Glass, that offer was about $30,000 on a
nearly $600,000 bill.
Mr. Nolan’s company has six employees, and he said
there was “unbelievable pressure” to finish Spire’s
aquatics center by last Sept. 13, despite repeated
requests from Spire for changes such as moving doors.
“Doors are usually 7% of a job,” Mr. Nolan said.
“Extrapolate what that means for the entire job, for
heating and ventilation.”
Mr. Nolan, like other small contractors who spoke
with Crain’s for its March 5 story, said the effects of
Spire’s nonpayment have been incredibly damaging.
“People have lost houses and equipment,” he said.
See DEVELOPERS Page 6
See SPIRE Page 7
‘RESHORING’
A SURE GOOD SIGN
Manufacturers increasingly bringing jobs back to U.S.
By DAN SHINGLER
[email protected]
B
usinesses looking for low-cost
markets in which to manufacture
their products increasingly are
turning to what’s emerging as a
surprisingly affordable option — the
United States.
“The costs in China and other places
have been rising so rapidly, it’s becoming
more obvious to companies they should
bring a lot of the work back to the U.S.,”
said Harry Mosher, a retired manufacturing
executive, former Cleveland-area resident and founder of the Chicago-based
Reshoring Initiative. Mr. Mosher’s mission
these days is convincing companies to
move operations to the United States from
other countries.
Mr. Mosher, who runs a website called
ReshoreNow.org, spouts off recent
examples of U.S. companies that have
“reshored” operations back to the United
States. One of his favorites is California-
New and improved
See RESHORING Page 11
THE WEEK IN QUOTES
“Our membership
would clearly line up
in favor of right to work
since small business
owners clearly believe
that it is a strong
concept that should
be in the marketplace.”
“We individually were
working on what we
thought were the best
practices, but when
we put our heads
together, we found a
better solution at a far
lower cost.”
— Roger Geiger, vice president
and executive director, National
Federal of Independent
Business/Ohio. Page One
— Thomas Selden, president and
CEO of Southwest General Health
System, part of the Community
Health Collaborative. Page 8
“I am hearing more
and more from people
who are downsized or
tired of the corporate
world who say,‘I would
love to start my own
company.’ In one hour
every week we talk
about how to do that.”
— Kip Marlow, host, “Entrepreneurs Club Radio.” Page 13
“You didn’t develop
your current time
management system
overnight. … You need
to work at it.”
— Larry N. Lamphier, business
coach and founder of Wintergreen Associates LLC,
Painesville. Page 15
WOMEN OF
NOTE
Crain’s is seeking nominations for
the women it will profile in its annual
Women of Note section, which is
scheduled for the July 23 issue.
Nominations can be submitted
through CrainsCleveland.com by
clicking on Women of Note under
the Features tab of the toolbar.
Nominations also can be sent via
email to editor Mark Dodosh at
[email protected], or via regular
mail at 700 W. St. Clair Ave., Suite
310, Cleveland, 44113.
The deadline for submissions is
Monday, March 19.
20120312-NEWS--4-NAT-CCI-CL_--
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12-18, 2012
Developer eyes new rentals in River
By STAN BULLARD
[email protected]
To create a site for a 275-unit
apartment building to go up, a
nearly empty shopping center in
Rocky River may go down.
That’s if a Columbus-based real
estate developer has its way.
Ryan Szymanski, senior vice president of development at Edwards
Communities, said the apartment
owner and builder is going through
due diligence to acquire part of the
Rockport Shopping Center to create
a location for a four-story apartment building. He said Edwards has
a purchase contract with the center’s
owner, Rockport Associates Co.,
that is contingent on several factors.
“It would be a good market for
upscale apartments,” Mr. Szymanski
said last Thursday, March 8, in a
phone interview. “It would add some
new multifamily in an area that has
not had any for many, many years.”
Edwards builds upscale communities, Mr. Szymanski said. The proposed building in Rocky River would
have a fitness center, movie theater
room, pool and clubhouse. Rents
for the one- and two-bedroom units
would be competitive with those at
Crocker Park in Westlake and in
downtown Cleveland, he said.
The unit count is not final and
may change as the project takes
shape, so Mr. Szymanski declined
to estimate a development cost for
the building. However, using industry
estimates, a project of 275 units
would cost around $40 million.
Kory Koran, Rocky River’s director
of economic and community development, said the city is working
with Edwards and the center’s ownership to fashion a plan that would
work for all parties as well as neighboring residents.
The city, the developer and the
building’s current owner are exchanging
site plans to work out something
acceptable to all three, Mr. Koran said.
Several years ago, he said, the suburb
changed its zoning code to allow
multifamily development in districts
zoned for shopping center use.
Rockport Associates is owned by
principals of the Beachwood-based
real estate owner and developer
Wald & Fisher. Eric Wald of Wald &
Fisher declined comment.
Mr. Koran, eager to discuss the
project, said the city suggested the
site to Edwards.
“This area has been a sore point
for the city for seven years,” he said.
The grocery-anchored shopping
center lost its supermarket when
Giant Eagle moved to a location
farther west on Center Ridge Road.
A former movie theater-turned-retail
space was demolished several years
ago. Also, a Target store vacated a
large, newer building on the west
side of the plaza after it became the
anchor for the redevelopment of
Westgate Mall in Fairview Park as
an open-air shopping center.
The apartment plan would use
about six acres of the site. The empty
Target building and a freestanding
Panera Bread in front of the building
would remain. Mr. Szymanski said
if the city approves its plans and
Edwards proceeds, construction
would not begin before 2013 because
the handful of remaining tenants
would need to move.
Edwards has properties in the
Toledo area but nothing in the
Cleveland market among its 3,600suite portfolio. An affiliate, Edwards
Student Housing Management Co.,
is building a 571-bed student housing
complex in Kent that is set to be finished in August. The student housing
arm has a total of 10,000 beds in 10
college communities nationwide. ■
Region gains from interest in ‘wet’ gases
By DAN SHINGLER
[email protected]
CreatingValue.
What do
You Value?
Maybe it’s advice from accounting
and tax professionals to help your
business grow and thrive.
We Value that too.
216.241.3272 or www.meadenmoore.com
Northeast Ohio’s economy is
poised to get a shot in the arm from
low natural gas prices, and it will
happen faster than most observers
thought just a few weeks ago, when
optimism already was high.
Thanks to the drop in natural gas
prices, industrial companies here
will have access to cheaper energy
and, in some cases, cheaper raw
materials than their international
competitors. Even your local McDonald’s stands to benefit as it
cooks your fries.
“In general, the cat bird’s seat is a
good place to put us right now — we
have the potential for our industry in
Ohio to be extremely globally competitive again,” said Jack Pounds,
president of the Ohio Chemistry
Technology Council in Columbus.
Thanks to natural gas found in
shale formations in Ohio, Pennsylvania and other states, the cost of
natural gas has dropped to wellhead
prices of $2.50 or less per thousand
cubic feet, or mcf. That’s the lowest
price since 2002, and it marks a
decline of more than 25% this year
alone. As recently as 2005, natural
gas was selling for more than $10
per mcf at the wellhead, according
to the U.S. Energy Information
Administration.
The decline is of importance to
Ohio because of the economics of
the shale gas drilling that is starting
to take place in Ohio. Unlike the
“dry” gas found in the Marcellus shale
deposits beneath Pennsylvania and
some of Ohio’s eastern counties, the
“wet” gas that’s found under roughly half of Ohio, in the deeper Utica
shale, is mixed with crude oil and
other valuable liquids.
Now that the price of natural gas
has collapsed, drillers are more
interested than ever in those other
liquids. That means they’ll step up
drilling in Ohio and it also means
the chemicals from those liquids —
vital to the state’s plastic and chemical industries — will be more plentiful and less expensive.
They want a cracker
Andrew Thomas, a former geophysicist and lawyer for oil and gas
companies in New Orleans and now
a researcher at Cleveland State University, said low natural gas prices
and lease clauses that require companies to drill within five years of
leasing property from landowners
will cause drilling here to speed up
from a handful of wells dug in 2011
to more than 1,000 per year by 2014.
“Then, I think, (the Utica shale)
will sustain that activity for 20
years,” Mr. Thomas predicts.
Down around New Philadelphia,
attorney Brad Hillyer, a longtime
expert on mineral rights, said he’s
already seeing the first waves of
activity as drillers come after the
Utica shale’s precious liquids.
“That stuff is bringing in $85 a
barrel now,” Mr. Hillyer said. “I get
visits daily from pipeline companies
that are trying to run pipelines across
Guernsey County, trying to get pipelines to the refineries up in Canton.”
Three small “cracker” plants, which
would refine industrial chemicals
from shale gas liquids, are planned
for the area, Mr. Hillyer said. They
would be in addition to a multibillion-dollar cracker Shell Oil Co.
wants to build in Ohio, Pennsylvania
or West Virginia to process those
chemicals in large quantities.
Volume 33, Number 11 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July,
the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland,
OH 44113-1230. Copyright © 2012 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio,
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Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877824-9373. REPRINT INFORMATION: 800-290-5460 Ext. 136
The smaller cracker plants he has
heard of represent investments of
about $50 million each, Mr. Hillyer said.
Into the fryer
Closer to Cleveland, the effects of
this activity likely will be felt most
dramatically by the chemical industry.
Mr. Pounds of the Ohio Chemistry
Technology Council said chemical
companies use raw materials derived
from natural gas and its associated
liquids as well as use power from
natural gas for their own production
processes.
If Shell builds its cracker, Ohio’s
chemical industry will increase its
output by about 20% within three
years, Mr. Pounds predicts. That
increase would translate into nearly $5
billion a year of additional business
for Ohio’s chemical industry, which
currently makes about $28 billion of
product annually, he said.
“With a cracker in the area
producing about a million tons of
ethylene a year, we would have the
lowest raw material costs of any
place in the world other than Saudi
Arabia or Canada,” Mr. Pounds said.
Mike Brakey, an energy consultant
in Shaker Heights, said he’s advising
any client who can to switch from using electricity to using natural gas.
One businessman who took Mr.
Brakey’s advice was Dave Stiles,
owner of Mimax One in Broadview
Heights, which is the operating company for Mr. Stiles’ five McDonald’s
restaurants in the area.
Mr. Stiles is converting his electric
fryers over to gas-powered versions,
he said, because the savings are too great
to ignore — even though a new natural
gas fryer costs more than $15,000.
They use a lot of energy, though,
so the conversion is still worth it, Mr.
Stiles said.
“It’s a big investment, but it takes
three times the cost to run an electric
fryer versus a gas fryer now,” Mr.
Stiles said. “I’ll be able to pay for
the thing in a year or two” from the
savings.
■
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
Maritime asbestos keeps law firms busy
Idle for years, 3,500
cases now on the move
By MICHELLE PARK
[email protected]
A judge’s decision to move along
3,500 asbestos lawsuits — some of
which have languished for more
than 20 years — has created a swift
current of cases that’s keeping a
number of Northeast Ohio law firms
busy.
“There’s just a lot to do all at once,”
said Julia R. Brouhard, an attorney
with Ray, Robinson, Carle & Davies
PLL, a Cleveland firm with a primary
focus on maritime law.
“For years, these things have been
sitting out there in limbo,” she said.
“Our clients would say every once in
a while, ‘What’s going on with these
cases?,’ and we would say, ‘Nothing.
Don’t worry about it.’ Now, we’re
needing to say, ‘You know those
cases? Now you need to worry about
them.’”
The cases are maritime asbestos
claims, brought by seamen who say
they were made sick by asbestos on
the ships on which they worked.
The first deadline to meet was in
January, the month U.S. District
Court Judge Eduardo C. Robreno in
Philadelphia deemed that discovery
would begin for the first cases to be
handled.
Months before, in summer 2011,
more than 30,000 of the cases were
dismissed, leaving about 3,500 active
cases. Those 3,500 are being handled
in seven staggered groups of roughly
500 at a time; discovery for the final
group begins in January 2013.
Law firms nationwide are working
the cases. Locally, Ray Robinson,
Gallagher Sharp and Thompson
Hine LLP are among those representing defendants, including ship
owners, many of which must decide
whether they want to continue
fighting the legal battle or settle
without knowing what the seamen
were exposed to, if they were exposed
at all, Ms. Brouhard said.
Cases that aren’t settled will be
remanded to trial in the U.S. District
Court, Northern District of Ohio,
where they originated.
“I think it’s going to take years,”
Ms. Brouhard said of closing the
cases. “If there’s an onslaught of
cases that comes back to Cleveland,
there are (only) so many federal
court judges, and they can handle
so many cases. It’s going to take a
long time.”
Beginning of the end?
With 500 cases beginning discovery
every couple months, there’s a
“great deal of work that’s going on
right now,” said Kevin C. Alexandersen, who chairs Gallagher Sharp’s
mass torts department.
“We’ve got people collecting
medical records, security records,
seaman records, Coast Guard records,
trying to compile information and
confirm diseases,” Mr. Alexandersen said. “Normally, you might do
that on one or two. When you’re
doing it 500 at a time, you’re allocating
your resources accordingly.”
Mr. Alexandersen’s firm is representing five defendants in about 400
of the first 500 cases. He said he
believes the cases may prove to be
the last massive action of this type.
“This litigation is tailing off,” he
said of asbestos-related claims, noting
how many potential plaintiffs have
died and how new regulations have
mitigated more recent exposure. “I
doubt you’ll ever see a tort of this
mass of asbestos litigation again.”
The maritime asbestos lawsuits
began popping up in the mid-1980s
and at one time numbered more
than 40,000, according to Ms.
Brouhard. In many cases, a plaintiff
seaman sued many defendants
because he worked on many ships
equipped with many products.
In the early 1990s, the cases were
consolidated into what is called
multidistrict litigation, which is used
when a group of federal cases has
similar issues. It was agreed that the
cases would be gathered in Philadelphia for the purpose of discovery.
Several years later, a judge entered
an order placing all the maritime
cases on an administrative dismissal
docket. Nothing much happened
again until 2011.
Dredging work
In many cases, the asbestos exposure is alleged to have occurred
decades ago, Ray Robinson’s Ms.
Brouhard noted, some as long ago
as the 1940s. The passage of time
makes retrieving documents related
to employment and illness nearly
impossible, she said.
“It’s very difficult just to try to
dredge up all this information,” said
Ms. Brouhard, who estimated her
law firm is defending 30 or so clients
in as many as 300 of the cases.
Veritext, a national firm with an
office in Cleveland, is providing
case management and document
retrieval services to defense attorneys
during discovery. The company hired
three full-time people in late 2011 in
anticipation of the increased workload, said Irene Rennillo, a consultant
and specialist in records at Veritext.
“When you have a case of this
volume, the management of it is
very crucial,” Ms. Rennillo said.
“You’re scheduling depositions
in multiple locations for multiple
people all at the same time.”
Ray Robinson doesn’t need to
add staff now, but Ms. Brouhard
said it’s possible it may hire one or
more paralegals to assist with the
enormous paper load involved. ■
Developers: Clients need convincing
continued from PAGE 3
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developers an easier way to build
websites that adjust to fit any screen.
Developers today often build separate websites to make sure content
looks good on desktop computers,
smart phones and tablet computers.
HTML5 standards have yet to
be approved formally by the World
Wide Web Consortium, which
defines the various standards developers should follow when building
websites. Even so, new versions of
most web browsers have been
designed to work with many of the
changes, Mr. Skorepa said.
Adoption will speed up once the
consortium makes its final decisions,
he added.
But it isn’t like other local web
developers are waiting around. For
instance, Briteskies LLC of Independence started building sites
using HTML5 during the second
half of 2011, and it has launched
three more since the start of 2012,
according to Michael Moores, director
of delivery for the information technology services firm. Briteskies also
is incorporating HTML5 tools as it
overhauls its own site.
Mr. Moores ticked off a long list
of capabilities the new standards
provide today, but noted that there
are more tools developers will start
to use once browsers support them.
For instance, developers eventu-
ally should be able to use HTML5
tools to build online applications
that, for the most part, can continue
functioning even if Internet access
is cut off, he said.
“I think this really does have a
huge impact,” he said.
HTML5, version NE Ohio
HTML5 is working its way into
local software products, too. Last
week, OverDrive Inc. of Valley View
announced that it had acquired
Booki.sh, an Australian company
that uses HTML5-based software
that allows users to read e-books
via a web browser.
Now, libraries and schools will be
able to access OverDrive’s catalog of
e-books and digital content without
downloading anything. That’s a big
deal, considering that people using
library and school computers often
aren’t allowed to download software, said David Burleigh, director
of marketing for OverDrive.
“It’s just giving people more
choices,” Mr. Burleigh said.
Software Answers Inc. will benefit
in a different way from HTML5. The
Brecksville company this fall aims
to start releasing HTML5 versions
of its ProgressBook education
software products. The main goal of
the conversion is to ensure the software works well on any device, said
Tony Mujic, ProgressBook product
manager.
“I don’t have to make an iPhone
app. I don’t have to make an Android
app,” Mr. Mujic said.
Some companies have been
hesitant to incorporate HTML5
features into their sites because
some of their customers use older
browsers that aren’t compatible.
Even so, several developers who
spoke with Crain’s said they can
build sites that recognize when users
have older browsers and present those
users with versions that exclude
HTML5 features. They also noted
that it is not hard to train web
developers to learn HTML5.
The move to the new standards
is “inevitable,” said Tom Nolan,
director of digital production at
marketing firm Marcus Thomas
LLC of Warrensville Heights.
Marcus Thomas in late February
launched an HTML5 version of its
own site and is building HTML5
sites for clients, Mr. Nolan said. Its
DigiKnow division used HTML5
when building the website for Sherwin-Williams Co.’s Pratt & Lambert
Paints brand.
Now the biggest challenge is convincing clients to take the plunge,
according to Aztek’s Mr. Skorepa
and other web developers.
“We’re starting, by default, to try
to convince people it’s OK,” Mr.
Skorepa said.
■
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3/8/2012
4:28 PM
Page 1
MARCH 12 - 18, 2012
WWW.CRAINSCLEVELAND.COM
CRAIN’S CLEVELAND BUSINESS
7
New Magnet support group GMAC jobs could land downtown
targeting entrepreneurs
By STAN BULLARD
[email protected]
By DAN SHINGLER
[email protected]
Some newly minted college
graduates and perhaps students
reaching the end of their academic
careers soon will have a place to
hang out, network with one another,
get on the Internet and, with some
luck, form some of Northeast Ohio’s
next successful businesses.
And it all can happen at a special
incubator built and maintained just
for them.
The manufacturing support group
Magnet is starting the project this
spring. Dubbed “The Beta Space,”
its purpose is to help would-be
entrepreneurs by allowing them to
network more easily with each other,
as well as with seasoned business
professionals, said David Crain,
director of entrepreneurial services
for Magnet.
The Beta Space will be aimed at
young entrepreneurs who have an
idea for a business that involves
manufacturing or engineering, Mr.
Crain said. Because they’ll be at
Magnet’s main site near downtown
Cleveland, they’ll have access to engineers, designers and other product
development specialists that Magnet
already uses as consultants to area
manufacturers, Mr. Crain said.
“They’ll be in a facility where all
we do is help people make stuff, and
they’ll have access to all of that,” he
said.
In addition, Magnet is signing
up service providers — lawyers,
accountants and experts in marketing
and finance — who will staff a group
of three offices at The Beta Space on
a rotating schedule. They’ll provide
free services and general counseling
not only to the young entrepreneurs,
but also to other manufacturingrelated businesses in the area, Mr.
Crain said.
“I’m signing up service providers
that will be in one to four days a
month,” Mr. Crain said.
The entire project is financed
with about $20,000 in local contributions, including a $10,000 grant
from the Burton D. Morgan Foundation, Mr. Crain said. That money
will outfit the approximately 2,000square-foot room with office furniture, desks, Internet, phone connections and most of what the
entrepreneurs will need to work,
aside from their own computers.
Mr. Crain said he already has
signed up his first couple entrepreneurs and is building out the space
with plans to open it in late April or
early May.
The Hudson-based Morgan
Foundation, named after the late
local entrepreneurial advocate Burt
Morgan, “believes networking and
building connections are important
elements of successful entrepreneurial activity and that the beta
space is designed to achieve that
goal,” foundation president Deborah
Hoover said.
“We’re particularly interested in
ensuring that young entrepreneurs
have the opportunity to connect
and we’re working to promote the
availability of the space among the
collegiate programs that we support,” she said.
■
Spire: Contractors hesitant
to cast project in bad light
continued from PAGE 3
“It’s very hurtful. It has the potential
of putting us out of business.”
Figuring out the next step
Instead of filing a lien, Corporate
Glass sued Hughes-Roller. Mr.
Osborne said until Spire’s troubles
became public, Ashtabula-area
contractors were hesitant to cast a
negative light on the project, which
has buoyed the Ashtabula area with
high-profile sports events since it
opened in 2010.
“We chose to do the lawsuit
because we thought it gave us a
better chance of getting the money
owed to us from the contractor than
doing the lien,” Mr. Osborne said.
Mr. Nolan said his door company
is reluctant to file suit because that
step only would delay the process of
repayment.
Now, those owed money for their
work are trying to figure out their
next step. According to Mr. Osborne,
there was a meeting last Tuesday,
March 6, at Hughes-Roller of subcontractors that had worked on the
Spire job.
Mr. Osborne, whose company’s
lawyer was present, said the subject
of a foreclosure action against Spire
and a subsequent sheriff’s sale are
potential options if the nonpayment
continues. The contractors involved
in the foreclosure then would use
the property as a way to recoup
their losses.
If they’re owed $15 million collectively, and the property is sold for
that amount or more, they’d be paid
in full, said Tim McGarry, a construction law attorney at Nicola, Gudbranson & Cooper. If not, and the
property sold for, say, $10 million,
each contractor would receive twothirds of the money they’re owed,
Mr. McGarry said. One of Nicola
Gudbranson’s clients, Air Control
Products of Broadview Heights, has
a lien filed against Spire.
Stuart Cordell, a lawyer for Spire’s
development group and a partner at
Warren & Young PLL of Ashtabula,
told Crain’s two weeks ago that the
developers had been turned down
by banks in their quest to obtain more
financing, and now are identifying
potential institutional investors. He
reiterated last week that no financing
agreement is in place, and he would
not speculate on when one would be.
Mr. Cordell also said he’s aware
that a lawsuit has been discussed.
“It’s one option, and the direction
they go is up to them,” Mr. Cordell
said. “What we are focused on is
finding financing to alleviate the
problem. If lawsuits get filed, it will be
unfortunate, but we’ll deal with
them.”
Meanwhile, the contractors
continue to scratch forward.
“We’re paying our vendors out of
our own pocket, and we’re one of
the lucky ones able to do that,” said
Mr. Osborne of Corporate Glass. ■
Add workers for GMAC Insurance,
a better-known brand than that of
its AmTrust Financial Services Inc.
parent, to the list of prospective
occupants of the 800 Superior Ave.
building in downtown Cleveland.
A total of six floors at the 23-story
office building would be dedicated
to auto insurer GMAC, while five floors
are earmarked for AmTrust Financial,
according to a construction budget
that AmTrust filed with Cuyahoga
County for a renovation of the building.
An AmTrust affiliate bought the
building last Aug. 29 for $7.5 million.
The document, which Crain’s
obtained in response to a federal
Freedom of Information request, is
in AmTrust’s application for a $3
million county loan. The loan would
be part of a $23 million financing
package that state, county and city
officials assembled to aid AmTrust’s
downtown project. AmTrust plans to
invest $20 million into rehabilitating
the building, which dates to 1969,
for its own use and for rental tenants.
AmTrust, through sister company
American Capital Acquisition Corp.,
acquired GMAC Insurance Personal
Lines of Winston-Salem, N.C., in
March 2010. At that time, American
Capital said it would keep GMAC’s
operations there.
AmTrust officials have said most
of the 1,000 jobs it plans to locate in
downtown Cleveland would be
newly created thanks to anticipated
business growth over the next three
years. An exception would be the
200 jobs the company plans to
move from its Seven Hills office.
AmTrust’s local spokeswoman,
Nancy Lesic, declined comment
about GMAC’s potential presence
at 800 Superior.
However, in responding to an
earlier email from Crain’s asking
about the possible relocation by
AmTrust of jobs to Cleveland from
outside the region, Ms. Lesic stated,
“The job number is based on anticipated growth, and may include some
consolidation from facilities in 22
other states. Plans have yet to be
finalized and determined. Until they
are, we can’t be more specific and
we don’t want to unnecessarily alarm
employees based on speculation.”
Laura Jones, a spokeswoman for
the new economic development
nonprofit JobsOhio, said AmTrust
has told the state that Ohio is in
competition with other states for
the AmTrust jobs. She said JobsOhio
does not identify competing states
because it needs an element of confidentiality to be effective.
Nathan Kelly, Cuyahoga County’s
deputy chief of staff for development, declined to discuss the GMAC
details in the loan application. He
said he is excited AmTrust plans to
expand in Cleveland.
GMAC, the former insurance
affiliate of General Motors Co., has
a history dating back to 1929. It provides property and casualty insurance, including auto coverage and
specialty insurance for recreational
vehicles and motorcycles.
American Capital and AmTrust
told Bloomberg news at the time of
the 2010 deal that buying the insurance unit for an undisclosed sum
from GMAC would double AmTrust’s
field sales force by adding 10,000
agents who also would sell other
AmTrust products.
AmTrust and American Capital
remain on an acquisition binge.
Since AmTrust announced its plans
last December to set up the downtown office, it bought another company, Builders & Trademen’s Insurance Services Inc. of Rocklin, Calif.,
which provides bonding and insurance for construction companies in
12 western states.
■
20120312-NEWS--8-NAT-CCI-CL_--
8
3/8/2012
4:43 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
Independent hospitals see benefits
WEDNESDAY, MARCH 21, 2012
Collaborative also gives them some needed strength
11:30 am Registration • 12 Noon Lunch & Program
Mary Taylor
Tami Longaberger
Moderated By
By TIMOTHY MAGAW
[email protected]
Stefani Schaefer
For more info: www.ExecutiveCaterers.com and click on Corporate Club or call 440.449.0700
A cadre of independent hospitals
and physicians in Northeast Ohio is
trying to show that while being part
of a mammoth health care system
can have its perks, remaining unattached still can be a sustainable way
to do business.
That’s why EMH Healthcare in
Elyria, Southwest General Health
System in Middleburg Heights and
Parma Community General Hospital
joined forces last summer to form
the Community Health Collaborative — an arrangement that has
allowed the hospitals to remain
independent but also to show more
collective muscle.
“Any of these hospitals could take
the route of being consumed by one
of the larger organizations,” said
EMH president and CEO Dr. Donald
Sheldon. “But rather than take that
route, each of the hospitals was
looking for a strategy that would
allow them to be independent but
get some of the positive things associated with critical mass.”
The hospitals already have reaped
benefits by simply acting like a big
health system without merging with
one of the region’s health care
juggernauts, such as the Cleveland
Clinic or University Hospitals,
according to Frank Lordeman, who
was hired last year to be president
and CEO of the collaborative, which
is organized as a for-profit company.
The operations of the collaborative,
including Mr. Lordeman’s salary,
are paid for equally by the three
hospitals.
“This preserves independence
and their economic strength and
adds to their sustainability,” said
Mr. Lordeman, a longtime health
care executive and former chief
operating officer at the Cleveland
Clinic. “This really allows them to
do bigger things than they could
have accomplished independently.”
The collaborative could become
even larger, according to Mr. Lordeman, who said the group is in
“various stages of discussions” with
other smaller, independent providers,
such as Firelands Regional Medical
Center in Sandusky, Lake Health
in Lake County and Fisher-Titus
Medical Center in Norwalk.
Of the Community Health Collaborative’s efforts thus far, the group’s
leaders cite its involvement in CliniSync — the state’s health information exchange, which transmits
patient data among care providers
— as one of its chief accomplishments.
Southwest General president and
CEO Thomas Selden said by bringing
the hospitals’ chief information
officers together to come up with
the best way of installing the computer infrastructure needed to
support the system, the hospitals
saved a combined $8 million over a
five-year period in capital expenses
and ongoing maintenance costs.
“We individually were working
on what we thought were the best
practices, but when we put our
heads together, we found a better
solution at a far lower cost,” said Mr.
Selden, whose hospital also has a
contractual relationship with University Hospitals, though it primarily
revolves around clinical endeavors.
Mr. Selden said the collaborative
now is exploring how the group best
can exploit its group purchasing
power.
Southwest General, for example,
spends about $50 million a year
through its group purchasing organization on medical supplies and
other items. Even a 1% savings on
those expenditures, or about $500,000,
would make the collaborative a
worthwhile endeavor, Mr. Selden
said.
By banding together with the
other hospitals, the group could
move up to a better buying tier, thus
receiving better deals on supplies.
Don’t forget the docs
Large health systems around
the country in recent years have
acquired thousands of independent
physician practices, but some
doctors have remained steadfast in
their quest to remain independent.
The Community Health Collaborative has aligned with a group of
independent physicians — the
Community Medical Group — to give
both groups even more leverage in
the region.
The group over the last year has
recruited about 475 of the region’s
independent physicians, who, like
the hospitals, can band together for
certain cost savings normally reserved
for big health systems. For one, the
group collectively can purchase
malpractice insurance, health insurance, billing services and office
supplies.
“The days of trying to do this on
your own are quickly going away,”
said Dr. John Gerace, a Westlakebased physician and chairman of the
governing board of physicians of the
medical group. “We can’t wait for that
to happen and have to respond now.”
Joan Mason, the group’s president
and CEO, said the medical group is
in the process of recruiting more
physicians. The group has used
traditional marketing tools such as
its website, open meetings and
newsletters to get the word out, but
Ms. Mason added that the “most
powerful recruitment tool we’ve had
to date has been the physicians”
already on board.
■
Cedar Brook Financial acquires again
Pepper Pike firm’s CEO
says scale is necessary
By MICHELLE PARK
[email protected]
RECEIVERSHIP SALE
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A March merger is deal No. 2 in
three months for Pepper Pike wealth
manager Cedar Brook Financial
Partners, whose leader says it remains
hungry for expansion that broadens
its expertise.
Effective March 1, Buzek Wealth
Advisors in Strongsville merged with
Cedar Brook. Buzek, which has been
in business for more than 20 years
and has assumed the Cedar Brook
name, adds three professionals and
$75 million to $80 million in assets
under management to the larger
firm.
Prior to the Buzek deal, Cedar
Brook in December acquired The
Professional Advisor Group, which
gave the firm offices in Bloomfield
Hills, Mich., and Naples, Fla., and
also added nine employees.
Terms of the deals were not disclosed. They are the first such deals
for Cedar Brook since its founding in
2005.
“We’ve grown and built scale since
our inception,” said Azim Nakhooda,
managing principal and CEO. “We
now have the strength and positioning
to go out.
“Unfortunately, there’s been a lot
of consolidation, a lot of change,”
he said of the wealth management
field. “A lot of firms just aren’t there
anymore, just not as strong, not as
big. Unless you’re a firm that’s scaled
enough to offer comprehensive
advice, I think it’s a tough climate to
be competitive in.”
Cedar Brook’s assets under management as of Dec. 31, 2010 — $1.54
billion — earned it the No. 7 spot in
Crain’s most recent list of investment advisers published last April.
Through the two deals, Cedar
Brook has increased its assets under
management moderately to roughly
$1.6 billion, Mr. Nakhooda said. Its
staff rose 23% to 64 employees.
Cedar Brook’s acquisition of The
Professional Advisor Group added a
Florida office, which is compelling
because of the “huge connection
between wealth in Northeast Ohio
and retirement in Naples,” Mr.
Nakhooda said.
The deal also gave Cedar Brook
more expertise in high-end charitable
planning and in working with medical professionals, which is particularly important given how so much
wealth in Cleveland is centered around
health care, Mr. Nakhooda said.
The merger with Buzek affords an
expanded presence in Cedar Brook’s
backyard.
“We’d been seeking a West Side
presence for years,” Mr. Nakhooda
said. “We wanted to do it with people
who were already there. We didn’t
just want to hang a sign.”
The Buzek deal also brings to
Cedar Brook more tax planning
expertise, Mr. Nakhooda said.
Buzek’s principal owner and
founder, Ken Buzek, said the two
firms’ client-centric philosophies are
aligned closely, and that Cedar Brook
has expertise into which Buzek’s
professionals now can tap. For
example, Cedar Brook has a director
of financial planning and a director
of company retirement plans, available for assisting others in providing
the right options for clients.
“I think this is a stronger business
model, merging the two firms,” Mr.
Buzek said. “We’ll be able to do a
better job for our clients and continue to grow.”
Cedar Brook is involved in other
merger and acquisition talks, said
Mr. Nakhooda, who anticipates other
deals closing in 2012. The firm has
an appetite for deals that expand its
expertise, particularly in retirement
plans, employee benefits and corporate service, where the firm works
with corporate clients, such as small
businesses and hospitals, he said. ■
20120312-NEWS--9-NAT-CCI-CL_--
3/8/2012
4:10 PM
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3/8/2012
4:18 PM
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
PUBLISHER/EDITORIAL DIRECTOR:
Brian D. Tucker ([email protected])
EDITOR:
Mark Dodosh ([email protected])
MANAGING EDITOR:
Scott Suttell ([email protected])
OPINION
Leverage
T
he Cleveland Clinic and University Hospitals
have earned their reputations as excellent
centers of medicine. However, it hasn’t been
until recent years that both institutions have
focused on leveraging the expertise within their
walls in ways that impact far more than the region.
Now, it appears there is no stopping them — and
even members of the community are getting in on
the leveraging act.
Consider the Feb. 28 announcement by UH of a
$250 million effort aimed at bolstering the development of new drugs. The initiative, dubbed the
Harrington Project for Discovery & Development,
is expected to help bridge the so-called “valley of
death” — the point in the development of a new
drug where it isn’t far enough along to attract
outside investment to fuel the long path toward
commercialization.
The cornerstone of the Harrington Project is a $50
million gift to UH from Ron G. Harrington and his
family. Mr. Harrington, whose family built and sold
Edgepark Medical Supplies in Twinsburg, understands how this gift — the largest in UH’s history —
holds the potential for leveraging medical discoveries
by advancing them to clinical trials and beyond.
“This is going to mean a lot of potential jobs, a lot
of potential new business ventures, and it will bring
physician-scientists into the Cleveland community
like nothing has before,” Mr. Harrington said.
The morning after UH’s big announcement,
Cleveland Clinic CEO Toby Cosgrove revealed in his
annual “State of the Clinic” address that the medical
powerhouse plans to leverage its good name by
acquiring health care institutions outside the region.
Doing so would allow the Clinic to expand its service
lines and better recruit top-tier talent.
“I think it’s something we have to consider because
health care is consolidating all across the country …
All of this drives efficiency,” Dr. Cosgrove told Crain’s.
It’s good for Cleveland and Northeast Ohio that UH
and the Clinic want to leverage their strengths in the
medical arena. Their plans stand to enhance their
standing and the region’s status as a health care mecca.
Dennis!
FROM THE PUBLISHER
The many faces of Dennis Kucinich
S
till, after all these years, I just
utility going, despite the costs.
can’t figure out how I feel about
He barely survived a recall election
Dennis Kucinich.
and then was voted out of office in favor
Like most people around here,
of a moderate Republican and fellow
my most recent image of Dennis was
native son, George Voinovich, who served
his far-less-than-gracious speech to his
the city well as mayor, and then Ohio as
supporters after getting thumped in last
both governor and U.S. senator.
week’s Democratic congressional primary
Dennis was a political cat with nine
by Toledo’s favorite daughter,
lives, though, and battled his
Marcy Kaptur.
way back, first into the state
BRIAN
He criticized her and her TUCKER
Legislature and then on to Concampaign staff for their negative
gress. His constituent service
attack ads, but his campaign
was known to be gold-standard,
ran its own share of similar TV
but he couldn’t resist those
commercials. It did him no good
Quixotic presidential campaigns.
to whine about such tactics
Perhaps the biggest disappointbecause all campaigns, especially
ment was when, after pledging
the close ones, seem to get to
to his constituents after the first
the gutter sooner or later.
failed presidential run that he
He knows that. He’s a veteran
wouldn’t do that again — well,
politician, decades removed from his
he did it again.
days as our city’s “boy mayor.” The
So I know that Dennis, despite being 65,
young Dennis was a masterful populist, but
will surface again in the public light once
with an ego that got in his way. He fired
his current term in Congress has ended.
a safety service director who was getting
The only question remaining is — where?
more publicity than him. He attacked
****
the city’s business establishment. He
MAYOR FRANK JACKSON DELIVERED
fought to keep the municipal electric
his annual State of the City speech last week
before a crowd at Public Hall, and reminded everyone about the successes of
his administration, thanked his employees
for their wage sacrifices and the civic and
business leaders for their support.
It was the usual speech, and one that
again mirrored the man, who is a low-key
public servant who seems to prefer a
good day in the office to a bright day in
the limelight. He reminded folks of the
city’s successes, and promised that there
would be more.
The only topic I wondered about was
his prediction that we still would be the
center of manufacturing of Great Lakes
wind turbines that will help reinforce his
image of this city as a center of sustainability. It seems the economics don’t
quite add up as the price of natural gas
plummets, but I hope he’s right.
He ended with a short discussion of
his visionary plan for reinventing the
public schools, a proposal that already
has earned the applause of our Republican governor. He knows that if he gets
that right, his city will become a national
model for urban education.
I wish him well. We all should.
■
THE BIG ISSUE
How do you think the new casino will change the atmosphere downtown, if at all?
D
ennis Kucinich’s own words nailed down a
key reason why he suffered a big loss last
Tuesday to Marcy Kaptur as the two House
Democrats vied to represent their party in
this fall’s contest for Ohio’s redrawn 9th congressional
district.
In a less-than-gracious concession speech, Rep.
Kucinich complained of Rep. Kaptur’s campaign
tactics, then said, “I am concerned about this
community and the kind of representation it will
receive, because we’ve established a set of standards
here of the kind of representation that people have a
right to expect.” Yes, Rep. Kucinich, people do have
a right to expect a certain kind of representation —
and they weren’t getting it when you spent months
away from Washington not once, but twice running
fruitless, self-indulgent campaigns for president.
Many figured out that you are about you, not them.
ANURAG SAXENA
STATE SEN. NINA TURNER
DAVE JARVEY
MICHELLE SEIFERT
Lakewood
Cleveland
Cleveland
Chardon
It’ll be interesting to see how
much the tax base increases. If
people who go to the casino
are from Northeast Ohio, then
it’s money that’s going from
one pocket to another versus
if people are coming from
different parts of the country
and coming to the casino.
I hope that downtown regains
its life and vibrancy, that
people will come downtown in
droves. ... The elements of
crime are always a concern,
but our law enforcement officials will be downtown in force.
It might be one of the safest
places in the city.
The casino will create more
business coming through and
create more jobs. Hopefully,
crime won’t increase but (the
casino will bring) more good
than bad.
I think it will help (downtown).
People are going to come
downtown and go to the
casino and the restaurants.
I’m sure you’re going to have
people with gambling issues,
and theft might go up.
20120312-NEWS--11-NAT-CCI-CL_--
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4:14 PM
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MARCH 12 - 18, 2012
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
11
Reshoring: China presence presents inefficiencies Companies
increasing
D&O liability
coverages
continued from PAGE 3
based Wham-O, maker of one of the
most iconic of American toys, the
Frisbee.
Two years ago, Wham-O moved
half its Frisbee production to California
from China, along with the production
of some other plastic toys to Michigan. The changes created only a
couple dozen jobs in the United States,
but Mr. Mosher likes the example
because it shows that almost anything
can be made profitably in this country.
“There’s nothing much simpler to
make than a Frisbee and there’s no
place in the U.S. more expensive
than California or Michigan,” he
said. “So if you can bring Frisbees
back from China to California and
Michigan, you can bring anything
back to Kansas.”
Closer to home, Ford Motor Co.
announced last October that it
would be moving production of its
F-650 and F-750 medium-duty trucks
to Avon Lake from Escobedo, Mexico.
Likewise, Horton Archery in Kent
announced last September that it
had completed the move of all its
production to Kent from China.
So long, China
Perhaps the largest local example
of reshoring is in North Canton,
where Suarez Corp. moved the entire
production of its main product,
EdenPure portable heaters, from
China to its home turf, creating more
than 400 jobs at the peak of its production season last fall.
“We were producing it all overseas
— large volumes overseas,” said
Michael Giorgio, Suarez’s general
manager and chief financial officer.
“But it made sense to move it here
from an economic and strategic
standpoint.”
Labor costs were going up in China,
Mr. Giorgio said, and upgrades to the
product were difficult to make when
engineering was on the other side
of the globe from the company’s
manufacturing operations.
There’s another reason the move
made sense, one that came into play
in a big way this winter: Suarez now
doesn’t need to order all its heaters
six weeks or more in advance, but
instead can make them to meet
demand. Had the company still been
making heaters in China, Mr. Giorgio
said, Suarez would have ordered
FILE PHOTO/MARC GOLUB
Mike Gammella, the president of United Auto Workers Local 1250, is hopeful
Ford Motor Co. continues to reshore jobs. That would help Ford’s Brook Park
operations.
enough heaters to see it through a
typical U.S. winter, only to have the
weather dash its hopes.
“We would still be sitting on a
substantial amount of inventory.
but, as it was, we were able to produce to order,” Mr. Giorgio said.
Suarez also uses local suppliers
for much of its materials and components, and Mr. Giorgio figures
his company’s production supports
at least another 125 jobs at those
suppliers.
“It takes four pallets of parts to
make one pallet of heaters, so you
can imagine what the supply chain
was doing,” said Mr. Giorgio, who
noted that the company made more
than 400,000 heaters in 2011.
Trickle-down theory
Some companies that never
manufactured products overseas
are benefitting by being in the
supply chains of companies that are
reshoring. Among them is Fanta/
Napco/Udylite of Cleveland, which
makes large metal finishing lines for
big manufacturers. The company
Feb. 1 announced it was expanding
by adding centrifugal dryers, also
used in finishing parts, to its product
line.
The metal finishing systems cost
from a few hundred thousand dollars
to more than $1 million, and each
one is made to order for a customer
either building or investing in a
plant, said president Frank Fanta.
His company is growing, in part,
because big customers such as
General Electric have moved production back to the United States
and installed new production lines
that include Mr. Fanta’s systems, he
said.
“People don’t realize the trickle
down when a Caterpillar or a GE
comes back,” Mr. Fanta said. “It’s
not just their workers — it trickles
down through the whole supply
chain.”
That’s a big reason the Reshoring
Initiative’s Mr. Mosher and others
hope the trend not only continues,
but also picks up speed. Mr. Mosher
is traveling the country preaching the
reshoring gospel; his stop include
one in Cleveland set for March 15,
when he speaks at an event held by
Magnet, the local manufacturing
advocacy and consulting group.
Meanwhile, in Brook Park, United
Auto Workers Local 1250 president
Mike Gammella said he hopes Ford
continues to reshore. Convincing the
company to bring more work back to
his plant from overseas is a major
goal for his union here, he said.
“We want them to bring more
work back, like machining cam
shafts and stuff,” Mr. Gammella said.
“There’s no reason any more that we
can’t do that work here instead of
some other country.”
A Ford spokeswoman declined to
comment on that matter specifically,
but noted that Ford has made some
significant announcements that
indicate it’s not done reshoring yet.
Last October, the company
promised its labor unions in their
most recent contract that Ford
would perform more work in the
United States — including adding
12,000 hourly U.S. jobs and investing
$16 billion in its U.S. product development and manufacturing operations by 2015.
■
By MIKE TSIKOUDAKIS
Business Insurance
More companies are increasing
the amount of director and officers
liability coverage they purchase,
while pricing for private companies
buying the coverage may be showing
signs of a hardening market, according
to a survey released last week by
Towers Watson & Co.
The report, “Directors and Officers
Liability: 2011 Survey of Insurance
Purchasing Trends,” surveyed 401
organizations that buy D&O liability
insurance. The group includes public,
private and nonprofit companies.
One-quarter of public companies
and 14% of private/nonprofit organizations said they increased their
D&O program’s total limits in 2011
versus 2010, according to the benefit
consultant’s survey.
“Particularly in the public space,
it just shows the level of concern
they have in terms of the broad
range of potential constituents that
can bring a claim,” said Larry
Racioppo, executive liability practice
leader at Towers Watson in Stamford,
Conn.
“We’ve seen that it’s no longer the
traditional shareholder class action
claim. It’s much broader than that,”
Mr. Racioppo said.
Sixty-two percent of public
companies and 35% of private companies were able to achieve a pricing
decline, according to the survey. But
more private organizations experienced increased premiums — 18%
compared with 14% of public companies.
While the public sector still may
be showing signs of competitiveness,
“we’re seeing that real hardening,
certainly in the private side,” Mr.
Racioppo said.
■
Mike Tsikoudakis is an associate
editor with Business Insurance, a
sister publication of Crain’s Cleveland Business.
LETTERS
Taking issue with gun glamorization
■ I was struck by the placement
and joyful image of a gun dealer on
Page One of your Feb. 27 issue. I
feel that such a subject and story
could be better found in a less-conspicuous section of your weekly
and a less-provocative photo used.
The tragic irony of your publishing
date and the murders that same day
by a murder-terrorist (yes, terrorism/terrorist on a smaller scale)
brandishing and using a gun to
commit murder at Chardon High
School are coincidental. What is
not is the urban terrorism found in
our region that increasingly is
encroaching in our suburban-rural
areas.
Our society loves our guns, as
illustrated by your story, which
adds to the perception (reality) and,
unfortunately, contributes to the
acceptance, if not glamour, of guns.
Is this part of the “brand” that our
region accepts as part of its marketing
strategy? I hope not.
I hope we, regionally, repudiate
the violence that we seem to have
been numbed to as a society.
We shouldn’t “stick our heads in
the sand.” However, there are
methods and devices we can use
to minimize potential, negative
perceptions. I hope that with the
passage of a week the reflection of
the editorial staff has modified their
prospective, professional decisions.
John Thomas
Kent
No good on guns
■ Your Feb. 27 cover story on the
Burton gun seller with the front
page picture of the owner holding
up an oversized handgun was in
poor taste, in my opinion.
The fact that it arrived at my
office the day of the Chardon High
School shootings just turned my
stomach.
Dennis Foster
Westlake
“ ...the top benefit of working
with Sales Concepts is,
of course improved profitability
and expanding our market...”
Frank Sidari
Vice President of Sales
Sandridge Food Corporation
300 employees
Remembering Shatten
■ I just re-read Brian Tucker’s
Feb. 13 commentary about Richard
Shatten. He did a great job reminding
us about Richard’s gifts, vision and
energy.
I also miss Richard greatly. He
was a major influence on me and
did much to provoke me to speak
up and step up.
Robert C. Smith
President and CEO
Spero-Smith Investment Advisers
INTERESTED? CALL TODAY, 440 575-7000
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20120312-NEWS--12-NAT-CCI-CL_--
12
3/8/2012
3:14 PM
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
Allen Pesec to quality assurance
manager.
GOING PLACES
JOB CHANGES
INSURANCE
DISTRIBUTION
BRUNSWICK COS.: Rick Axel to
commercial account executive;
Gabrielle Meles to professional
liability account coordinator.
APPLIED INDUSTRIAL TECHNOLOGIES: Christopher D. Harris
to director, business development.
KAPPUS CO.: Mike Romanchek,
to director, sales and marketing.
EDUCATION
KENT STATE UNIVERSITY: Todd
Diacon to senior vice president,
academic affairs and provost.
FINANCE
DOLLAR BANK: John Solich to vice
president, business banking.
OHIO COMMERCE BANK: Cierra
R. Freeman to credit analyst.
FINANCIAL SERVICE
CARNEGIE INVESTMENT COUNSEL:
Patrick J. Kennedy to portfolio
manager.
FAIRPORT ASSET MANAGEMENT:
Aaron S. Nuti to staff consultant.
SCOTT SNOW (FINANCIAL ADVISORS)
LLC: Philip S. Postma to financial
adviser.
SKODA MINOTTI: Nick Ward and
Jonathan Emerson to staff accountants.
EATON CORP.: Shelley McGrail to
director of talent management;
Carrie Ortsey to director of organizational effectiveness; Deborah
Severs to senior vice president,
global ethics and compliance.
MARCH 12 - 18, 2012
Jeff Walker to senior technical
specialist; Kyle Burgess to account
manager; Nici Crosby to marketing
coordinator and education program
manager; Kelly Sachs to inside
sales manager.
DAKOTA SOFTWARE CORP.: Bob
Kimball to marketing manager.
HYLANT GROUP: Brad Croce to
vice president, client executive;
Janice Gallagher to vice president,
client services property/casualty;
Linda Langman to client service
executive; Emily Weeks to senior
client service manager; Andrea
Stegmaier to client service specialist;
Terri Ferricci and Marissa Ramsey
to client service assistants.
RETAIL
UTILITY
STERLING JEWELERS INC.: Ed
Hrabak to executive vice president,
COO; Stuart Lee to senior vice
president, merchandising; Dawn
McGuire to vice president, merchandising.
FIRSTENERGY: Carl J. Bridenbaugh
to vice president, transmission.
LEGAL
BRAVO WELLNESS: Amy Petrus to
director of human resources.
SERVICE
BAKER & HOSTETLER LLP:
Michael K. Gall, David E. Kitchen,
Patrick T. Lewis and David F.
Proano to partners.
THE PATTIE GROUP: John Miller
to project director.
HAHN LOESER & PARKS LLP:
Kelly A. Kosek, John Paul Lucci,
Shannon V. McCue, Christopher
W. Peer and Aaron M. VanderKaay
to partners.
TUCKER ELLIS & WEST: Brian
O’Neill to partner and co-chair,
business department.
STAFFING/EXECUTIVE
SEARCH
DIRECT RECRUITERS INC.: Gary
Gardiner to HVAC team leader.
TECHNOLOGY
ACCENTURE: Jim Dickey to chief
operating officer, North America.
MANUFACTURING
AZTEK: Jordan Burnside to director,
web marketing.
AMERICAN ROLL FORM PRODUCTS:
Melrex Ordillas to process engineer;
BOUNDARY SYSTEMS INC.: Jeff
Harding to executive account manager;
Romanchek Diacon
Solich
Kennedy
Nuti
Postma
Hrabak
Lee
McGuire
BOARDS
LIFEBANC: Mariann Pacak (St.
Elizabeth Health Center) to president;
John Geller to president-elect;
Donna Luebke to secretary; Cheryl
Baily to treasurer.
AWARDS
AMERICAN CHEMICAL SOCIETY,
DIVISION OF POLYMERIC MATERIALS — SCIENCE AND ENGINEERING: Stephen Z.D. Cheng
(University of Akron) was named a
PMSE fellow.
AMERICAN SOCIETY FOR
MICROBIOLOGY: Piet de Boer
(Case Western Reserve University
School of Medicine) was named a
fellow.
Rebecca Peters and Heather
Homolka received The Kate Madden
Leadership in Service Award;
Jennifer Arnold received The Sharon
Griffiths Giving Heart Award.
HANDSON NORTHEAST OHIO:
Chris Richardt received the Volunteer
of the Year Award; J.R. Fairman,
Send information for Going Places to
[email protected]
As Monsters’ momentum
builds, ticket prices rise
In business,
every connection matters.
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By JOEL HAMMOND
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The Lake Erie Monsters have
arrived.
How do we know? Because they’re
raising ticket prices, even if it will
take some doing for customers to
see those increases.
The Monsters, in their fifth
season and making a push for their
second straight playoff berth, will
raise some ticket prices “nominally,”
according to Mike Ostrowski, the
team’s senior vice president and
cheap operating officer — to $8
from $7 and to $25 from $23, for
instance.
But like their Quicken Loans Arena
co-tenant, the Cleveland Cavaliers,
the Monsters still are rewarding
customer longevity and loyalty, as
those full-season ticket buyers who
use Dan Gilbert’s FlashSeats service
will see the least bump.
The Cavaliers operate similarly:
Crain’s reported last December that
the team, in its first season without
a LeBron James ticket bump,
lowered prices in a range of the “low
single digits into the low double
digits,” according to a team
spokesman. (The Cavaliers required
season ticket holders to renew for
the 2010-11 season before Mr.
James announced his decision to
leave.)
But similar to the Monsters, the
Cavaliers’ price decrease depended
upon many factors, including longevity, renewal timing and payment
plan.
The Monsters, on the strength of
some large weekend crowds of late,
have moved to third in the 30-team
league in attendance, averaging
7,595 through 29 games as of last
Tuesday night, March 6. The team
drew a combined 19,455 March 3
and 4, the first game of which was
Browns Night and the second of
which featured a “Pucks and Paws”
promotion, where more than 500
dogs entered The Q.
The Monsters have been buoyed
by big crowds on Saturdays, on
which the team has averaged 11,404
fans in seven games. That figure
includes 17,109 fans on Jan. 21.
The Monsters ranked sixth (6,568
per game) last season — which
equates to a 15.6% attendance
jump this season — and in 2009-10
(6,484).
■
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20120312-NEWS--13-NAT-CCI-CL_--
3/8/2012
3:15 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
MARCH 12 - 18, 2012
INSIDE
14 TAX TIPS:
CORPORATE TAX
SYSTEM FACES
OVERHAUL.
13
SMALL BUSINESS
IN BRIEF
■ A HOME AWAY FROM HOME:
Office Space Coworking, an operation that provides small, home-based
businesses a work location, has relocated to the Everett Building, 39 E.
Market St., in downtown Akron. Office
Space Coworking offers members
private offices or less formal community
spaces. Memberships, which are
month to month, also include access
to high-speed Internet, whiteboards,
printers, scanning equipment and
shipping and mailing services. “Office
Space Coworking is a refuge from the
isolation of working at home and the
restrictions of working in busy coffee
shops,” said owner Bill Forsyth III.
“Members get all the tools and community of a modern office without the
stuffy, corporate environment.” Office
Space Coworking also has a location in
Cuyahoga Falls.
MARC GOLUB PHOTOS
Kip Marlow, on air at WELW-AM 1330’s studio with his “Entrepreneurs Club Radio” show and guest Richard Sippola of Chautauqua Consulting Inc.
A SHOW FOR STARTERS
Radio program offers advice, experiences for next group of entrepreneurs
By JUDY STRINGER
[email protected]
K
ip Marlow is one of those
baby boomers who just
couldn’t stay retired.
While his peers have been
traveling, gardening or playing golf, the
Willoughby Hills resident has turned
his own entrepreneurial experience
into a weekly radio program focused
on what it takes to transform an idea
into a revenue stream.
The unique format of “Entrepreneurs Club Radio” offers “real-world
Mr. Marlow says of his radio show, “I enjoy
advice and guidance from real-world
doing it because hopefully it helps someone.”
entrepreneurs,” Mr. Marlow said. “I am
hearing more and more from people
programs that include 10 minutes of
who are downsized or tired of the corpotopical coverage of things like the economy
rate world who say, ‘I would love to start
or investing as part of a two-hour program,”
my own company.’ In one hour every
Mr. Marlow said, but nothing to his
week we talk about how to do that.”
knowledge that dedicates an hour specifIn his role as host, Mr. Marlow prods
ically to running and managing a startup
entrepreneurs to share their own experifrom the mouths of those who have done
ences and probes his guests about the
it.
fundamentals of creating a successful
business venture.
It takes one to know one
The program broadcasts locally on
Mr. Marlow is no stranger to the
WELW-AM 1330, Mondays at 4 p.m., but
entrepreneurial spirit. In the mid-1970s,
soon it will get national exposure
Mr. Marlow founded Marlow Surgical
through a syndication agreement with
Technologies, a medical device company
Dallas-based Broadcast Affiliate Sales.
that held 13 patents and marketed surgical
The contract will make “Entrepreneurs
instruments throughout the world.
Club Radio” available to 2,000 indepenCooper Companies Inc. acquired Marlow
dent radio stations across the country.
“There are national syndicated
See SHOW Page 15
■ BY THE BOOK: Amy A. Crist
has opened a bookbinding and art
conservation studio in the Gordon
Square Arts District of Cleveland’s
Detroit Shoreway neighborhood.
Services offered include
conservation treatments of works
on paper,
books and
photographs;
museum-style matting and
framing; building custom boxes and
protective enclosures; and creating
one-of-a-kind books and albums. Ms.
Crist is a Brecksville native whose
studio is outfitted with a combination of
state-of-the-art and traditional equipment,
including a 100-year-old, 800-pound,
cast-iron board sheer with a 55-inch
blade.
■ BEER HERE: The Cleveland Ale
House has opened in the Lauren Hill
Plaza, North Olmsted, in the former
Slam Jams site. The
refurbished 7,000-squarefoot space features
Cleveland memorabilia
from sports teams, political
figures and musicians.
Owned by brothers Sean,
Kevin and Scott Hanna,
along with Sean’s wife,
Tricia, the Cleveland Ale
House has a menu that
features pub fare with an
upscale twist under the
direction of chef Matt Auck,
formerly with the Cleveland Indians
and the Washington Redskins. The beer
list includes a rotating selection of 12
draft beers and more than 80 domestic
and imported craft bottled beers, and
there is a fully stocked bar of wine and
liquor.
■ GRAND OPENINGS: To submit a
new business for listing in an upcoming
small business section, send the
following by email to Amy Ann
Stoessel at [email protected]:
business name, address; city and ZIP;
website; brief description of business;
business phone number; business fax
number; business email address; and
date that business opened.
20120312-NEWS--14-NAT-CCI-CL_--
3/8/2012
3:15 PM
Page 1
14 CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
SMALL BUSINESS
Marketer says brand starts within Obama urges simpler
Studiothink acquires
firm, adds focus on
work force culture
By AMY ANN STOESSEL
[email protected]
Kaminski
Lobas
C
hristine Lobas and Ron
Kaminski want to change
the way people think. Or at
least the way the employees
think within the organizations of
their clients.
Ms. Lobas is the founder of the
Cleveland-based marketing agency
Studiothink, which recently acquired Mr. Kaminski’s business,
Corporate Quest, a leadership and
culture development firm with
locations in Cleveland and Charlotte, N.C.
As part of the deal, Studiothink is
the only remaining brand. Ms.
Lobas is majority owner and managing partner, while Mr. Kaminski
and Mark Stornes, a longtime
Studiothink shareholder who has
assumed the chief financial officer
role, are equity partners.
The idea behind the pairing of
the two firms is simple: Brand
management must be done from
the inside out. Employees have to
buy in to the same messages that
are being delivered to potential
clients or customers, and the work
force has to be the No. 1 brand
evangelist, Ms. Lobas and Mr.
Kaminski said.
To that end, the pair has created
a product called CultureShoc, which
focuses on helping a company or
organization align its external and
internal brands. The process includes
team-building exercises, leadership
development, meeting facilitation
and individual coaching.
Ms. Lobas said she stresses that a
brand is more than a slogan or logo;
it is the conversation people are
having about an organization. With
the addition of Mr. Kaminski’s firm,
Studiothink’s rebranding process
now can include a focus on an
organization’s culture.
“They’re engaging us in a time of
change in most cases,” said Mr.
Kaminski, who now serves as
president of the Galleria-housed
firm’s culture development group.
Such was the case with Siemens
Energy Inc., which recently consolidated product lines and work forces
at its Charlotte, N.C., campus.
Mark Pringle, who is vice president
at Siemens’ Charlotte Energy Hub,
said the employee count at the
location expanded from 750 to
1,450, and it eventually could peak
at 1,800.
Siemens worked last year with
Studiothink and Corporate Quest to
facilitate the transition, creating
and building upon the theme of
“Better Together.”
“I think we helped create the
culture of the new organization,”
noted Mr. Pringle, who said part of
the process was getting to the root
of “who are we, and what do we
want to be.”
The “Better Together” mantra
may have even rubbed off on Ms.
Lobas and Mr. Kaminski, who said
the work on the Siemens project
helped convince them to join as
one company.
Looking to stand out
The ever-changing landscape for
Northeast Ohio’s advertising and
marketing sector — from the shutdown of Liggett Stashower to the
partnership between Adcom Group
and Landau Public Relations — is
not lost on Ms. Lobas and Mr.
Kaminski.
They see their concentration on
the culture segment as a way to
stand out from the crowd and
differentiate the firm.
“We help make the passionate
engagement more possible,” Ms.
Lobas said. “Nobody is putting it
together in a way that moves the
bar.”
Ultimately, Ms. Lobas anticipates
Studiothink will grow due to the
acquisition, adding up to three
employees this year. The combined
firm currently has a staff of 13, and
it will maintain a North Carolina
presence.
And while she anticipates an
80-20 division this year between
branding and culture development,
respectively, Ms. Lobas hopes to
eventually eliminate the line
between the two in terms of the
services the firm offers.
“You should not be dividing
brand and culture,” she said.
■
“I TRUST NATIONWIDE® WITH MY
EMPLOYEES’ BENEFITS.”
— Dale Earnhardt Jr.
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© 2011 Nationwide Mutual Insurance Company. All rights reserved. Underwritten by Nationwide Life Insurance Company. NEB-0502
corporate tax system
Joint proposal with Treasury Department would
lower rate and eliminate loopholes, subsidies
I
n budget and corporate tax
reform proposals, President
Barack Obama is pushing for
lower tax rates and new incentives to spur job growth. But he also
wants to tie off some loopholes and
cut through complexity to broaden
the tax base and make the system
more efficient.
The White House and the
Treasury Department recently
issued a joint proposed framework
for overhauling the system of business tax to make it more competitive
and more effective.
With incentives and exceptions
layered into the tax code over many
years, the system has come to
distort basic business decisions
about what to produce, in what to
invest, how to finance a business
and what business form to use, the
report says. “The system is also too
complicated, especially for America’s
small businesses,” the proposal
says.
The reform proposal says the
corporate tax rate should be lowered
to 28%, putting it more in line with
other countries, while also eliminating dozens of different loopholes
and subsidies.
It also proposes refocusing the
manufacturing deduction and
using the savings to reduce the
effective rate on manufacturing to
no more than 25%, while encouraging
more research and development
and the production of clean energy.
In his fiscal year 2013 budget
proposal, President Obama outlines
a number of tax changes along
these lines.
A centerpiece to the budget
proposal includes a tax credit to
support investments in communities
that have had major job losses,
along with a temporary 10% tax
credit for new jobs and wage
increases for qualified employers.
The credit would be equal to 10% of
the increase in an employer’s 2012
eligible wages over what it paid in
2011.
Another key proposal includes a
general business credit against
income tax to reward companies
that “insource,” or bring into the
United States, business that currently resides overseas.
The credit would be equal to 20%
of the eligible expenses paid or
incurred in connection with the
move to insource the activity. At the
same time, it would disallow deductions for expenses to offshore
any existing U.S. business.
To rev up manufacturing, the
budget proposes a deduction for
domestic production activities,
giving taxpayers a break based on
activities that lead to domestic
manufacturing activity.
Qualifying activity would include
any tangible personal property,
computer software, sound recordings
and certain films, electricity, natural
gas, water, construction, engineering
and architectural services. It would
eliminate the production deduction
for oil, gas and coal, and expand the
deduction for high-tech manufac-
PETERDEMARCO
TAX TIPS
turing.
The president wants to extend
some provisions of the 2010 Tax
Act, most notably the bonus
depreciation and research tax
credits.
The 100% bonus depreciation
provision contained in the act
extended through the end of 2011,
but the president hopes to see it
extended through the end of 2012
and into 2013 for certain long-lived
property and transportation property.
The 20% tax credit for qualified
research expenditures also extended
through 2011, and that too should
be extended and made permanent,
the proposal contends.
The budget proposes to repeal
the last-in, first-out method of
accounting for inventory, which is
based on the assumption that the
oldest, lowest-price inventory
remains on the shelf while the most
recently purchased (and presumably higher-priced) inventory is
moved out.
The LIFO method produces a
tax benefit because it expenses a
higher cost for inventory, and it has
been on the president’s radar for
several years. The lower-of-costor-market method also would be
repealed.
Finally, the president is calling on
Congress to authorize the Internal
Revenue Service to help smaller
companies put to rest problems
with misclassifying workers. The
IRS devotes a great deal of time
and energy to assuring companies
properly classify workers as
employees rather than contractors
to assure their wages are properly
taxed.
The White House believes the
problem can be remedied by
allowing the IRS to require reclassification of workers whose reclassification has been prohibited under
current law.
As these are proposals to be
hashed out during an election year,
it’s impossible to predict how many
of these ideas will gain traction in
Congress and become law in the
coming months.
But it’s worth noting that Congress
has heard the outcry in recent years
that the current tax system is
burdensome for U.S. companies,
making it difficult for them to compete globally.
■
Mr. DeMarco is vice president and
director of tax services for the regional accounting and business consulting firm of Meaden & Moore,
headquartered in Cleveland.
20120312-NEWS--15-NAT-CCI-CL_--
3/9/2012
2:51 PM
Page 1
MARCH 12 - 18, 2012
CRAIN’S CLEVELAND BUSINESS 15
WWW.CRAINSCLEVELAND.COM
SMALL BUSINESS
GETTINGAHEAD
Your monthly guide to getting to the next level in your career.
Show: Unique mindset required
continued from PAGE 13
Time management: Prioritizing
to-do list can help limit stress
By AMY ANN STOESSEL
[email protected]
S
ometimes it seems there
simply are not enough
hours in the day.
Time management can
be an acquired skill, but experts
say with enough planning and
thought it’s possible to inject a bit
of sanity into the 1,440 minutes
that make up one’s day.
Ultimately, it’s a matter of
strategizing and priority setting
that can put an end to the tug-ofwar that can develop between
competing interests for one’s time.
Artist Barbara Bloom, owner of
Parma-based Images In Bloom,
knows that push-and-pull feeling
well, experiencing it late last year
as she and her husband transitioned into having a home-based
business.
“When you work full-time for
someone else, you have a routine
… when you’re home that changes
to a casual feel,” she said.
Images In Bloom took root after
the Blooms each were downsized
from their jobs. Ms. Bloom specializes in hand-dyed silk scarves
and other handmade goods,
including handbags created out of
plastic grocery bags. Mr. Bloom
makes soap products, all of which
are sold online, at local specialty
shops and at craft shows.
Ms. Bloom, who has a master’s
degree in public administration,
said she has started to try to plan
out the week a little more, list all
the things that need to be done
and prioritize them. She also tries
to schedule out tasks for certain
times of the week.
“If you don’t have those goals,
often those goals keep moving
out,” she said.
Painesville-based business
coach Larry N. Lamphier agrees
with the concept of prioritizing. In
fact, he subscribes to the teachings
of Stephen R. Covey, author of
“The 7 Habits of Highly Effective
People,” who uses the concept of
a time-management matrix.
The matrix has four quadrants,
with urgent and not urgent
columns intersecting with important and not important rows.
Basically, Mr. Lamphier
explained, every task in one’s day
falls into one of these quadrants —
important/urgent; important/not
urgent; not important/urgent; or
not important/not urgent. Time
management is a matter of figuring
out what activities fall into what
quadrants and setting aside blocks
of time for each category.
As part of the process, it is
essential to determine timewasters and to identify one’s
“rocks,” Mr. Lamphier said, those
activities — personal or professional — that are most important
and non-negotiable.
“The biggest challenge people
are having today is getting rid of
their smart phones,” Mr. Lamphier
said “It’s effecting people emotionally. … It forces people into a
reactionary mode.”
Erin M. Nunn, director of career
services and internships at Lake
Erie College, stressed that time
management ultimately comes
down to a lot of organization and
planning ahead.
She suggests taking a week to
track exactly how one’s time is
spent, and utilizing tools like
monthly calendars and reminders
on smart phones.
“Sometimes people just get
caught up in their day,” she said.
Of course, both Ms. Nunn and
Mr. Lamphier acknowledged that
the process of time management is
a task that might eat up some time
itself.
“You didn’t develop your current
time management system
overnight,” Mr. Lamphier said.
“You need to work at it.”
And that’s exactly what Ms.
Bloom is continuing to do as her
business continues to develop.
“Probably my biggest wish is
every day I could be a little more
consistent,” she said.
But, as a business owner, she’s
also come to realize that flexibility
is just as important: “Don’t be so
doggedly determined to stick to your
goals that you miss opportunities.” ■
FOLLOW THE LEADER: A Q&A
CRAIG BOISE
Dean
Cleveland-Marshall
College of Law
W
hen Craig
Boise took over
as dean of the
ClevelandMarshall College of Law, he saw it
as a chance to be back in Cleveland
full time.
While not a native Clevelander,
Dean Boise has worked here since
1999 in a number of positions,
including at Case Western Reserve
University School of Law and the
law firm Thompson Hine LLP.
Most recently, however, he had
been working at DePaul University,
commuting for two years between
Chicago for work and back to
Cleveland, where his family continued to live.
In his post since July, Dean Boise
describes the current landscape for
law graduates as “bleak.”
But there’s an upside: It
means a person really
needs to have a strong
passion and desire to be a
lawyer when choosing the
field.
“I think that’s actually
good for the profession,”
he said.
■ Last book read? “The End of
Lawyers?” by Richard Susskind.
■ Favorite TV show? “Mad
Men.”
■ Who do you admire and why?
I admire the many hundreds of
Cleveland-Marshall College of Law
grads who overcame great obstacles to pursue their dreams of
obtaining a law degree while
working full-time jobs, raising
children, running businesses or in
between deployments in the
armed forces. Their stories inspire
me and make me proud to be associated with Cleveland-Marshall
College of Law.
■ What most surprises you
about the path your career has
taken? How unpredictable all of
this was at the start. From farm
kid, to classical piano major, to
police officer, to tax lawyer, to law
professor and finally, law school
dean.
■ What skill do you wish you
had? I would love to have a better
memory — particularly for names!
■ If you weren’t in your current
occupation, what would you be
doing? I’d probably own a little
beach bar somewhere in the
Caribbean.
■ Career advice you wish
someone would have given you?
There’s no hurry — take your time
figuring out what you want to be
when you grow up. Turns out
that’s what I did, but it would have
been nice not to have been worried
about it along the way!
■ Favorite nonwork activity?
That’s a toss-up between sailing
and riding my Harley.
BUILDING YOUR NETWORK
Get involved and stay informed
by building your network online
and in person.
■ For those in the 20-to-35 age
range living or working in Lorain County,
the Young Professionals Committee of
Big Brothers Big Sisters of Lorain
County offers a chance to network,
meet new people and get involved in
other social issues within the community.
Contact: Marcus Madison,
resource development director and
communications officer, 440-2776541
Web: www.bigloraincounty.org/
YoungProfess.html
■ A little shameless self-promotion:
Stay up to date on business happenings (and networking opportunities) by
checking out Crain’s calendar of
events at www.crainscleveland.com/
section/events.
Surgical in 1997 in a cash and stock
swap valued at $6.6 million. Mr.
Marlow stayed on with the new
owner for several years before a
hectic travel schedule persuaded
him to retire.
He didn’t keep a low profile for
long. Mr. Marlow began consulting
in 2005 and soon took the helm of
the Entrepreneurs Club of America,
a networking group for established
entrepreneurs and would-be company founders. It was there that he
and Gary Schoeniger conceived of
the radio project.
“I thought, ‘Wouldn’t it be great
if I had a show where I interviewed
entrepreneur guests and got them
to share their stories?’” Mr. Marlow
said. “I realized a lot more people
could learn the life’s lessons of an
entrepreneur (in a radio format).”
Mr. Marlow and Mr. Schoeniger,
founder and CEO of The Entrepreneurial Learning Initiative (ELI),
launched Entrepreneurs Radio Club
in January 2010. Mr. Schoeniger
left a few months later to concentrate on ELI, a source for online
course content about entrepreneurialism for organizations and
schools, but he frequents the show
as a guest.
“Kip really understands that
entrepreneurs will lead us into the
future,” Mr. Schoeniger said,
“because he is one and has seen
what an entrepreneur can do.”
Now in its third year, “Entrepreneurs Club Radio” has attracted
such guests as Pandora Media
founder Tim Westergren, Shearer’s
Foods Founder Bob Shearer and
business blogger Anita Campbell.
Future guests include Gail Good-
man, CEO of Constant Contact, and
Eric Reis, author of the best-selling
business book, “The Lean Startup,”
appeared in February. Mr. Reis
also is founder of IMVU, or the
Instant Messaging Virtual Universe,
a website on which people interact
via 3-D avatars.
“What is so neat is that you don’t
have to be an entrepreneur to listen
and learn,” said Mr. Shearer, who
didn’t hesitate when Mr. Marlow
reached out. “I enjoy doing it because
hopefully it helps someone. … We
know what (entrepreneurs) are
going through because we’ve been
there.”
A crazy bunch
As the program moves to a
national stage, Mr. Marlow is
proud to play a role in demystifying
the entrepreneurial process. He
said most guests will credit their
management team or employees.
“That’s nice, but it’s more than
just surrounding yourself with great
people,” he said. In his own experience and in dozens of discussions
with others, Mr. Marlow said the
common thread of an effective
entrepreneur is the ability to innovate and overcome.
“Entrepreneurship is a mindset,
a can-do, never-give-up, reach-yourgoals-or-fail-trying mentality,” he
said. “Entrepreneurs are a bit crazy,
think outside the box and eventually try to change the world.”
The weekly, one-hour Entrepreneurs Club Radio program is
streamed live at www.welw.com
during its Monday 4 p.m. broadcast.
Edited podcasts of guest
interviews also are available at
www.teca.com.
■
Make this
your year of
Financial
Improvement!
What would bring financial improvement to your business
and help you sleep at night?
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20120312-NEWS--16-NAT-CCI-CL_--
16
3/8/2012
11:01 AM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
CREDIT UNIONS
RANKED BY DEC. 31, 2011 ASSETS
Name
Address
Rank Phone/Website
Assets (millions)
Dec. 31, 2011 Dec. 31, 2010
% change
Loans
(millions)
Dec. 31, 2011
Shares & deposits
(millions)
Number of
Dec. 31, 2011
members
Membership groups
Top executive
Title
1
Seven Seventeen Credit Union
3181 Larchmont Ave. NE, Warren 44483
(330) 372-8100/www.sscu.net
$775.7
$759.1
2.2%
$497.0
677.0
71,644
Live, work, worship, attend school in
Trumbull, Mahoning, Columbiana, Portage
or central Stark County communities
Gary Soukenik
CEO
2
Century Federal Credit Union
1240 E. Ninth St., Room 719, Cleveland 44199
(216) 535-3200/www.cenfedcu.org
$315.0
$312.7
0.7%
$197.9
285.6
25,986
Open to federal government agencies and
any Northeast Ohio business, association,
municipality or educational institution
Tony Coniglio
president, CEO
3
Firestone Federal Credit Union
31 Hanna Parkway, Akron 44319
(234) 352-1100/www.fofcu.com
$233.4
$242.2
-3.6%
NA
NA
12,637
Bridgestone/Firestone employees
Wayne A. Chapman
president, CEO
4
GenFed Financial Credit Union
85 Massillon Road, Akron 44312
(330) 784-5451/www.genfed.com
$182.5
$174.8
4.4%
$119.4
151.1
19,583
Lorain, Erie, Summit and Medina counties;
Ford, ASW, Reiter Dairy, Quality Mold,
Rubbermaid, other local companies
Joyce R. Jones
president, CEO
5
Firefighters Community Credit Union
2300 St. Clair Ave., Cleveland 44114
(216) 621-4644/www.ffcommunity.com
$178.1
$177.0
0.6%
$126.0
156.0
25,005
Open to everyone in Cuyahoga and Lake
counties
Ben Laurendeau
president, CEO
6
BFG Federal Credit Union
445 S. Main St., Akron 44311
(330) 374-2990/www.bfgfcu.org
$161.8
$168.2
-3.8%
$99.3
0.1
28,711
Individuals who live, work, worship,
volunteer or attend school in Summit
County
Michael J. Owens
president, CEO
7
Cardinal Community Credit Union
8500 Westport Drive, Mentor 44060
(440) 266-2200/www.cardinalcu.com
$156.2
$153.7
1.6%
$94.3
137.2
17,812
All who work, live, attend school or worship Christine Blake
in Cuyahoga, Lake, Geauga and Ashtabula president, CEO
counties
8
Ohio Catholic Federal Credit Union
13623 Rockside Road, Garfield Heights 44125
(216) 663-6800/www.ohiocatholicfcu.com
$155.9
$150.6
3.5%
$98.6
141.8
18,310
Any person connected with the Catholic
Diocese of Cleveland and/or Diocesan
parishes, schools, or organizations
9
CSE Federal Credit Union (1)
1380 Market Ave. North, Canton 44714
(330) 452-9801/www.csefcu.com
$149.4
$130.5
14.5%
$110.3
134.5
29,443
Open to persons who live, work, worship or R. Stanley Barnes
attend school in Stark County
CEO
10
Lormet Community Federal Credit Union(1)
2051 Cooper Foster Park Road, Amherst 44001
(440) 960-6600/www.lormet.com
$145.7
$144.3
1.0%
$65.7
127.8
20,797
Lorain County residents
11
Associated School Employees Credit Union
1690 S. Canfield Niles Road, Youngstown 44515
(330) 792-4000/www.asecu.com
$144.5
$144.2
0.2%
$66.4
129.3
20,484
Lives, works, worships or attends school in Michael Kurish
Mahoning, Trumbull or Columbiana counties president, CEO
12
VacationLand Federal Credit Union
2409 East Perkins Ave., Sandusky 44870
(419) 625-9025/www.vlfcu.org
$139.3
$137.8
1.1%
$90.5
124.1
15,608
Lives, works, worships or attends school in Kevin J. Ralofsky
Erie County
CEO
13
School Employees Lorain County Credit Union Inc.
340 Griswold Road, Elyria 44035
(440) 324-3400/www.selccu.org
$136.3
$133.9
1.8%
$62.9
125.1
11,637
Employees and students of educational
entities in Lorain County, other
miscellaneous employer groups
Brent T. Binkley
president, CEO
14
Ohio Educational Credit Union
2554 E. 22nd St., Cleveland 44115
(216) 621-6296/www.ohioedcu.com
$118.0
$114.8
2.9%
$82.9
106.9
20,473
Employees, students and alumni of public
and private schools and colleges in Ohio
Jerome R. Valco
CEO
15
Towpath Credit Union(2)
2969 Smith Road, Akron 44310
(330) 664-4700/www.towpathcu.com
$114.0
$72.2
57.9%
$51.3
99.3
21,000
Lives, works, worships or attends school in Rose Bartolomucci
Akron, Fairlawn, Cuyahoga Falls, Bath and president, CEO
townships of Copley and Richfield
16
PSE Credit Union Inc.
5225 Regency Drive, Parma 44129
(440) 843-8300/www.psecreditunion.org
$112.4
$106.3
5.7%
$51.0
99.2
22,151
Anyone who lives, works, worships or
attends school in Cuyahoga or Medina
counties
Janice L. Thomas
president, CEO
17
Stark Federal Credit Union(1)
4100 Dressler Road NW, Canton 44718
(330) 493-8325/www.starkcu.org
$100.7
$95.4
5.7%
$33.5
89.4
13,774
Anyone who lives, works, worships or
attends school in Stark or Carroll counties
Nino J. Gemma
president, CEO
18
Golden Circle Credit Union(1)
4118 Lincolnway E., Massillon 44646
(330) 479-3130/http://goldencirclecu.com
$96.6
$94.9
1.9%
$33.2
80.9
13,969
Live in Stark County
Jeffrey J. McClain
CEO
19
Best Reward Credit Union
5681 Smith Road, Brook Park 44142
(216) 367-8000/www.bestrewardcu.coop
$95.4
$95.1
0.3%
$34.1
75.6
13,160
Live, work, worship or attend school in
J. Shirilla
Cuyahoga, Lake, Geauga, Medina, Summit, John
president, CEO
Lorain and Portage counties
20
Cleveland Selfreliance Federal Credit Union
6108 State Road, Parma 44134
(440) 884-9111/www.clevelandselfreliance.com
$86.8
$81.9
6.0%
$43.7
73.1
4,427
Ukrainian American community
Orest Liscynesky
treasurer, manager
21
Lakeview Federal Credit Union
2909 State Road, Ashtabula 44004
(440) 998-2707 /www.lakeviewfcu.com
$79.2
$75.8
4.5%
$47.0
69.4
8,376
Live, work or worship in Ashtabula County
Sherry S. Cornell
CEO
22
Buckeye State Credit Union
155 E. Voris St., Akron 44311
(330) 253-9197/www.buckeyecu.org
$77.4
$77.9
-0.7%
$44.0
68.9
17,894
Community membership in Shaker Heights
and Summit, Stark, and Lake counties
N. Sue Preston
CEO
23
Taleris Credit Union Inc.
1250 E. Granger Road, Cleveland 44131
(216) 739-2300/www.taleriscu.org
$69.7
$71.5
-2.5%
$35.7
56.7
10,222
Individuals who live, work, worship or
attend school in Cuyahoga County and
select groups and organizations
Robin D. Thomas
president, CEO
24
Unity Catholic Federal Credit Union
5839 Ridge Road , Parma 44129
(440) 886-2558/www.unitycatholiccu.org
$68.3
$65.6
4.2%
$28.9
61.9
11,205
Parishioners, families, students, employees Tamlyn M. Straightand organizations within the Catholic
Schervish
Diocese of Cleveland
CEO
25
Community First
2043 E. Prospect Road, Ashtabula 44004
(440) 997-5919/www.hereforeveryoneonline.com
$67.8
$64.4
5.3%
$23.6
56.7
6,387
Live, work, worship in Ashtabula County
26
Medina County Federal Credit Union
1353 Reimer Road, Wadsworth 44281
(330) 334-1023/www.mcfcu.com
$61.8
$56.0
10.5%
$25.3
54.6
7,664
Open to anyone who lives, works, worships Bud Herrle
or educates in Medina County
chairman
27
Community One Credit Union of Ohio
6583 Frank Ave. NW, North Canton 44720
(330) 305-3050/www.c1cu.com
$61.1
$60.3
1.3%
$26.7
56.4
5,639
Serving Stark County
Evelyn L. Canterbury
president, CEO
28
Eaton Family Credit Union
333 Babbitt Road, Euclid 44123
(216) 920-2000/www.eatonfamilycu.com
$52.1
$48.2
8.0%
$35.3
47.2
12,177
Eaton Corp., City of Euclid, Lake County,
family of existing members
Michael Losneck
CEO
29
Community Star Credit Union
832 Cleveland St., Elyria 44035
(440) 365-7342/www.commstar.org
$50.8
$47.4
7.2%
$31.8
46.1
8,864
Membership is open to the public
Ernie Jackson
president, CEO
30
Emerald Group Credit Union Inc.
13201 Granger Road, Garfield Heights 44125
(216) 581-5581/www.emeraldgcu.com
$48.7
$46.8
4.0%
$32.1
44.0
8,330
Individuals who live, work, worship or
attend school in Cuyahoga County
John R. Martin
CEO
Information is supplied by the companies unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are
complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are
available to purchase at www.crainscleveland.com. (1) Information is from the National Credit Union Administration, www.ncua.gov. (2) Towpath Credit Union and Telecommunity
Credit Union merged June 1, 2011.
Randall A. Trimm
CEO
Daniel R. Cwalina
president, CEO
Mike Riesterer
CEO
RESEARCHED BY Deborah W. Hillyer
20120312-NEWS--17-NAT-CCI-CL_--
3/9/2012
3:24 PM
Page 1
MARCH 12 - 18, 2012
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
17
Schools: Critics fear bureaucracy Work: Supporters say
law entices businesses
continued from PAGE 1
Union that it was left out of the
planning process and that the plan
threatens security they have won at
the bargaining table. The transformation plan would let the district
use measures other than seniority
when it lays off teachers.
In the interview after his State of
the City address, Mayor Jackson
had to be coaxed to acknowledge
that if the Legislature doesn’t go
along with the Cleveland plan, and
city voters do not approve a school
levy, the district and the $65 million
deficit it faces would become the
responsibility of the Ohio Department of Education.
And if that happens, the mayor
said, the teachers’ union could lose
more than it would under his plan.
“You can call it a hammer,” he
said when that term was used by a
reporter. “I call it a fact. In order for
us to have any chance or likelihood
of passing a levy, we have to
demonstrate to the public they will
get a different outcome than they are
getting now and that there is accountability for what they pay for.”
State lawmakers must sign off on
the plan because it proposes changes
to Ohio law that would apply only
to Cleveland. For instance, state law
requires that teachers with less
seniority be laid off before teaches
with more seniority, a particular
sore point for Mayor Jackson and
Mr. Gordon.
Under one umbrella
The School Transformation Plan
proposed by Mayor Jackson and
Mr. Gordon seeks to change the
school district in major ways.
Most significantly, it would take
what is called a “portfolio approach”
to school management. This relatively new educational strategy,
being implemented in Denver,
Indianapolis and several other cities,
gives school principals greater
responsibility over budgeting and
hiring. It also would allow private
charter schools, with district
administration approval, to receive
public money for their programs.
Mr. Gordon said bringing charter
schools under the district’s levy is
an important step forward.
“Part of what we have to ask ourselves is, at the end of the day, are we
going to fight about who owns the
schools or are we going to start
fighting about how good those
schools can be?” he said.
And, he noted, the change would
give parents of children in charter
schools a reason to vote for a levy.
The plan also creates something
called the Transformation Alliance,
a group composed of parents, educators, business people and other
civic leaders who would evaluate
district schools — as well as public
and private charter schools — on
common performance standards. It
would recommend which schools
should be supported and which
should be closed or cut off from
public money. The central office
then could direct resources to the best
schools and could close failing ones.
The plan would override the
current collective bargaining agreement with the Cleveland Teachers
Union and would give the district
flexibility over teacher pay and
assignments.
Terry Ryan, a vice president of the
Thomas B. Fordham Institute, an
education nonprofit based in
Dayton and Washington, D.C., said
he believes Cleveland is “embarking
on the boldest citywide school
reform effort that the state of Ohio
has ever seen.”
“Their success or failure will resonate throughout the state and likely
beyond,” Mr. Ryan said.
The Fordham group, which
sponsors charter schools in Ohio, is
backed by the Bill and Melinda
Gates Foundation and the Walton
Family Foundation. It has questioned
the lack of flexibility in teacher
labor contracts.
Watchdog, or added hoops?
The still-amorphous Transformation Alliance is expected to be a
watchdog of sorts for charter school
growth. It also would be tasked with
recommending to the state Department of Education whether a new
charter school should open within
city limits — an authority that
Greater Cleveland Partnership
president Joe Roman called a “very
important lever” to ensure that only
quality schools operate in the city.
“The alliance is a place where the
business community and others
can directly engage,” said Mr. Roman,
whose business organization has
thrown its full weight behind the plan.
Moreover, the alliance would
mount an aggressive marketing
campaign during open enrollment
season to inform the community
about the best-performing schools,
both charter and public, in the city.
“The business community is very
supportive, and the business community has a strong interest in an
educated work force,” said Alan
Rosskamm, former CEO of Jo-Ann
Stores Inc. and now CEO of Breakthrough Schools, which operates
charter schools in Cleveland.
However, officials at both
Constellation Schools and White
Hat Management, which also run
charter schools in Cleveland, argue
Mayor Jackson’s proposal could
inject another layer of bureaucracy
to what they consider an already
lengthy list of regulations imposed
on charter schools.
“There is a fairly rigorous system
and audit and control process in
place” said White Hat president and
CEO Tom Barrett. “If this is better
or different, I’m all for it, but I don’t
think we need multiple ways of
managing the process.”
Constellation Schools president
Rick Lukich said the alliance, if
implemented, could reduce choice
for parents. He went as far as calling
Mayor Jackson’s proposal “an experiment on the children of Cleveland.”
Mr. Lukich called the district’s
assertion that it would share potential levy dollars with charter schools
a “red herring,” adding that he finds it
hard to believe the financially strapped
district would forfeit potential
revenue to the charter schools.
However, Breakthrough Schools,
which has four schools sponsored
by the Cleveland school district, is
salivating at the prospect of receiving levy revenue. It’s something the
group has wanted for some time to
help offset financial gaps it currently makes up with fundraising, said
John Zitzner, president of Friends
of Breakthrough, the fundraising
and advocacy arm of the charter
school network.
“We don’t see this as an anticharter thing at all,” he said. “It can
sound like that to some people, but
we believe it’s a way to prevent bad
schools from opening.”
■
Parma: Industrial demand on the rise
continued from PAGE 1
“We’ve had good interest from
manufacturers so far,” Mr. Greenberg said of the space, which carries
an asking rent of $3 a square foot.
Mr. Greenberg estimates it may
take about two years to fill the former
GM plant. Its relative youth —
dating from 1970 — and appealing
features will help the leasing effort.
“The building breaks up well,”
Mr. Greenberg said. “It can serve
tenants from 50,000 to 250,000
square feet equally well.”
Recently vacated auto plants are
meeting the wrecking ball on an
epic scale, as seen at the former
Chrysler stamping plant in Twinsburg and the Ford Motor Co.
foundry in Brook Park. However,
Mr. Greenberg said the good condition of the Parma building and the
strength of the industrial market
around Cleveland Hopkins International Airport argued for keeping
the structure intact.
“There is an infrastructure here
that manufacturers otherwise
would have to install,” he said,
pointing to power lines above and
sections of the floor containing rubber blocks below him.
Love that industrial space
The resilience of the region’s
manufacturing base is on Mr.
Greenberg’s side.
Terry Coyne, executive vice president of Grubb & Ellis Co., said the
industrial market is not just warm;
it’s blazing.
“Stuff is going off the market so
fast it’s unbelievable,” Mr. Coyne
said. He estimates a 12% vacancy rate
in the region’s industrial market and
notes vacancy in the southwest/airport market in Cleveland dropped
to 12% from 14% in a single year.
George Pofok, senior vice president at the Cresco real estate
brokerage in Independence, said
demand for 100,000-square-foot
blocks of space is on the upswing,
adding, “I’ve had clients looking for
buildings with cranes for more than
a year.” New development is more
problematic, he said, as businesses
focus on buying bargain properties
shed in the recession.
Also excited by the opportunity
the property presents — and glad
Parma retained the GM stamping
plant that remains in operation
next door — is Parma Mayor Timothy
DeGeeter.
“We’re focused on this property,”
the mayor said, as it provides an
opportunity for the city to land jobs
and the region to keep them. Mayor
DeGeeter said the city is seeking a
$750,000 state grant for road construction to serve the new business park.
Mr. Greenberg estimates the
property can yield as many as seven
structures and 500,000 square feet
of business space. He estimates it
may take as long as 10 years to develop the business park.
■
continued from PAGE 1
than 16,000 members.
“We haven’t even discussed it
yet,” Mr. Roman said. “We’ve not
entertained that idea at all yet.”
Both groups were active in the
fight to restrict the collective
bargaining rights of public employee
unions under Senate Bill 5. However,
that measure — passed last spring
by the Republican-controlled Legislature — subsequently was rejected
last November by 61% of the voters
in a referendum known as Issue 2.
The business groups may be
taking their cue from Gov. Kasich.
The Republican governor has said
as recently as January that he wasn’t
ready to jump back into a statewide
battle after the resounding repeal of
SB 5. And an email last week from
his office only confirmed that reluctance.
“Re-creating a jobs-friendly environment is essential to getting Ohio
back on track,” said Gov. Kasich’s
spokeswoman, Connie Wehrkamp,
in a statement issued last Thursday,
March 8, when his office was asked
by Crain’s about the governor’s
position on the proposed right-towork amendment.
“We’ve successfully cut taxes,
torn down regulatory barriers to job
creation and replaced our antiquated
economic development agency with
a new, more effective private sector
corporation,” Ms. Wehrkamp wrote.
“These strategies and others are
showing good results, and our focus
right now is to keep pursuing them,
but we’re open to additional strategies as needed.”
Indiana breaks the mold
The right-to-work amendment a
group called Ohioans for Workplace
Freedom is floating actually
expands on certain restrictions on
unions that were a part of SB 5. The
amendment would prohibit collective bargaining agreements between
unions and public or private
employers that require employees to
join a union or, alternatively, to pay
the equivalent of dues to the union
as a condition of their employment.
Indiana Gov. Mitch Daniels last
month signed legislation that made
his state the 23rd in the country —
but the first in the Rust Belt — to
allow workers in unionized operations to decide for themselves
whether to pay union dues. Gov.
Daniels and others argued that
passing the legislation would make
the state more attractive than its
neighbors to companies looking to
locate new operations.
The only business group backing
the proposed Ohio amendment
so far is the Associated Builders
and Contractors of Ohio, which has
three state chapters. Most ABC
members are non-union, or merit
shop, construction contractors. Its
statewide director of government
affairs, Bryan Williams, a former
legislator, has been active in shaping
the amendment.
“Our members know that states
that have workplace freedom have
better economies,” Mr. Williams said.
“Our group wants a strong business
environment, because when there
is a strong business environment,
there is a demand for commercial
construction.”
Looking for traction
Ohioans for Workplace Freedom
“Our members know
that states that have
workplace freedom have
better economies.”
– Bryan Williams, director of
government affairs, Associated
Builders and Contractors of Ohio
got off to a slow start, after the Ohio
Ballot Board initially rejected the
wording of its amendment last
November. It won board approval
last month to start gathering the
386,000 valid signatures it will need,
but the group isn’t sure whether it
will have enough signatures to get
on the ballot this November. If it
misses the deadline to make this
November’s ballot, it will shoot for
2013.
The same conservative and Tea
Party groups backing this proposed
amendment were behind last
November’s successful state Issue 3
that sought to rein in the federal
health care plan in Ohio.
The effort is buoyed by a recent
poll by the Quinnipiac University
Polling Institute. The Hamden, Conn.,
group last month found 54% of Ohio
voters responding would favor passage of a right-to-work amendment.
Chris Littleton, spokesman for
Ohioans for Workplace Freedom,
said he is gathering financial support from business groups to mount
a successful signature-gathering
campaign, though he wouldn’t
identify the group’s supporters.
“There is a lot of quiet supporters
and donations,” he said. “But I
wouldn’t want to speak for those
groups and publicly announce their
support.”
Mr. Littleton said the group won’t
file its first campaign finance report
until July.
‘Freeloading concept’
One group most likely to support
the effort is the National Federal of
Independent Business’ Ohio chapter,
a statewide advocacy group for
small business owners.
Roger Geiger, vice president and
executive director of NFIB/Ohio,
said his group “has a longstanding
position that supports the concept”
of a right-to-work law.
“Our membership would clearly
line up in favor of right to work
since small business owners clearly
believe that it is a strong concept
that should be in the marketplace,”
Mr. Geiger said. “But we haven’t
made a formal proposal to our leadership council.”
The Construction Employers
Association, however, opposes any
version of a right-to-work amendment, said Tim Linville, executive
vice president of the group that
represents 500 union construction
contractors in Northeast Ohio.
Mr. Linville said he is concerned
in particular about the impact of
right-to-work laws on construction
worker pension funds, which are
organized by trade union classification and are run by boards of construction employers and union officials. In right-to-work states, he said,
workers who don’t pay dues “are
still entitled to the union contract
and all the benefits it has in it,
including the pension fund.”
“We don’t believe in getting
something for nothing,” Mr. Linville
said. “Basically, right to work is a
freeloading concept.”
■
20120312-NEWS--18-NAT-CCI-CL_--
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3/9/2012
2:52 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MARCH 12 - 18, 2012
REAL ESTATE CLASSIFIED
Phone: (216) 522-1383 Fax: (216) 694-4264
Contact: Toni Coleman
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PROPERTY
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SALE
VILLAGE OF NEWBURGH HEIGHTS
SALE OF PROPERTY
Former AutoNation sites
available for sale by auction.
STYS, SINCE 1962
The Village of Newburgh Heights is accepting sealed bids for the sale of
Permanent Parcel Number 511-14-001. Bids should be submitted in writing, sealed and mailed via certified mail or hand delivered to Newburgh
Heights Village Hall, 4000 Washington Park Boulevard, Newburgh
Heights, OH 44105. No bid will be accepted after 4pm on Friday, March
23rd, 2012. All bids will be opened at a public hearing on Friday, March
23, 2012 at 4:45 PM. The public bid opening shall be held at Newburgh
Heights Village Hall, 4000 Washington Park Boulevard, Newburgh
Heights, OH 44105. The Village of Newburgh Heights reserves the right
to reject all bids. For additional information please contact the Mayor’s
Office at 216-641-4650.
Rare opportunity to purchase
large land tracts with highway
visibility and access in established markets on Cleveland’s
east and west sides.
Visit
www.autonationsites.com
for more information and to submit offers.
Bids due by March 23, 2012
FLYNN
ENVIRONMENTAL
CITATION CJ2 AIRCRAFT
PUBLIC NOTICE
REALTORS:
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MARCH 12 - 18, 2012
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
19
THEINSIDER
THEWEEK
MARCH 5 - 11
The big story: Leading e-book distributor
OverDrive Inc., now based in Valley View, broke
ground on a new headquarters in Garfield Heights.
OverDrive said it has begun construction of a
95,000-square-foot building on a 12-acre campus to accommodate more than 300 employees.
The company said its need for a new headquarters,
which it is calling its Blue Sky Campus, is “a
result of domestic and international growth in
the e-book industry.”
Shopping spree: Westgate Shopping Center
in Fairview Park has changed hands. Inland Real
Estate Corp. said it has acquired Westgate and
a shopping center
in the Cincinnati
market for a total
of $109.4 million,
excluding closing
costs and adjustments. Inland, a real
estate investment
trust, said it bought
STAN BULLARD
Westgate on March
6 for $73.4 million. Westgate is a former enclosed
mall that was transformed into an outdoor
shopping center. It totals about 474,000 square
feet of leasable space.
On second thought …: FirstEnergy Corp. is
re-evaluating its plan to shut its Eastlake power
plant. Instead of closing the Lake County plant,
the company is considering replacing its coalfired turbines with four combustion turbines
that could be fired by natural gas or oil. The electric
company’s FirstEnergy Generation Corp. subsidiary filed an application for a feasibility study
with PJM Interconnection, its regional transmission organization, to install turbines that would
deliver about 800 megawatts of what the industry
calls peaking power. Such power comes online
only at times of high electricity demand.
REPORTERS’ NOTEBOOK
BEHIND THE NEWS WITH CRAIN’S WRITERS
Rocky Mountain firm
high on West Tech Lofts
■ Monarch Investment and Management
Group, an apartment owner and manager
based in Franktown, Colo., is the new owner
of West Tech Lofts, 2201 W. 93rd St. in Cleveland.
Through MIM XXXVI West Tech Lofts
LLC, Monarch on Jan. 31 paid $6.56 million
for the 189-unit property, according to
Cuyahoga County land records. The seller
was RRE HUD MMF 2007, an affiliate of
Resource Real Estate Inc. of Philadelphia
that had paid $4.5 million for it in 2009.
Brian Polley, Monarch’s regional manager
for northern Ohio and southern Michigan,
said his company was able to secure the
apartment property at a price that allows it
to hold the lofts profitably for a long time.
The lofts are 96% occupied. The purchase
also gives Monarch its first property in
Cleveland; it joins six other complexes in
Ohio that it already owns.
The character of the 1912-vintage former
high school also attracted the owner of more
than 8,000 apartments.
“It’s a unique property,” Mr. Polley said.
“We think we can make it better.” — Stan
Bullard
Barking up
the right tree
■ Pat Covey now has climbed to the second
branch from the top.
Mr. Covey, 48, who has worked for The
Davey Tree Expert Co. based in Kent for
more than 20 years, has been named chief
MILESTONE
Wear in the world: Lincoln Electric Holdings
Inc. acquired Weartech International Inc., a
privately held producer of cobalt-based hard
facing and wear-resistant welding consumables.
The maker of welding equipment did not say
what it paid for Weartech, which is headquartered in Anaheim, Calif., and has manufacturing
plants in Anaheim and Port Talbot, Wales.
Weartech has annual sales of $40 million and
employs a total of 140 people at both locations.
Data-driven: Laird PLC of London acquired
Summit Data Communications Inc. of Akron in
a deal initially valued at $22 million. Summit,
which develops and sells non-cellular wireless
communications equipment, will remain in the
Akron Global Business Accelerator for now. The
company expects to move to another location
within the city as the business grows.
Off the wall: Omnova Solutions in Fairlawn
sold another piece of its commercial wallcovering
business. Omnova sold its U.K.-based Muraspec
business to affiliates of a2e Venture Catalysts
Ltd. and its principal, Amin Amiri, of Manchester, England. Muraspec has about $40 million in
sales. The announcement of the Muraspec deal
follows the sale last December of certain assets
of Omnova’s North American commercial wallcovering business to J. Josephson.
Going public
without the IPO
■ A small information technology services
firm in Brecksville has gone public through
a reverse merger with a shell company
incorporated in Florida.
Panther Expedited on prowl
for a buyer, Reuters says
Debbie and Ron Russell
THE COMPANY: Russell Real Estate
Services, Strongsville
THE OCCASION: Its 50th anniversary
Appropriately enough, this full-service real
estate company was born in the basement of
a family home.
Newman “Russ” Russell and his brother-inlaw, Roy Waddell, started the business at home
in Brook Park in June 1962. Shortly thereafter, they opened a more formal office, on
West 120th Street at Lorain Avenue in Cleveland.
Russell now has seven offices in Northeast
Ohio — the Strongsville corporate office, plus
operations in Amherst, Brecksville, Medina,
North Ridgeville, Sandusky and Westlake —
as well as several satellite locations.
The company that began in a basement
now has nearly 500 professional agents.
Russell services real estate needs in not
just the Cleveland and Akron areas, but in
Pennsylvania, Toledo and the Lake Erie Islands.
It’s still family-owned and operated, as Ron
and Debbie Russell took over the business in
the late-1990s. A third generation of Russell
family ownership is in the offing, as their
sons, Jeff and Kevin, both are licensed and
working in the business.
“Fifty years is a special accomplishment
in today’s real estate world,” Ron Russell
said. “As other companies are closing their
doors … or merging, Russell just keeps on
getting bigger and better.”
For information, visit www.RussellRealty.com.
In an all-stock transaction, Infiniti Systems
Group Inc. on Jan. 31 acquired 60% ownership in League Now Holdings Corp. (OTC
Bulletin Board: LNWZ). The main purpose
of the merger is to give the company access
to Wall Street investors, as League Now has
no operations, CEO John Bianco said.
Infiniti will need money because it’s
looking to buy other IT companies, Mr.
Bianco said. Infiniti announced Feb. 29 that
it has agreed to buy IDK Health LLC, a
Northeast Ohio company that has developed a software system designed to help
health care providers process medical
claims.
IDK stopped developing the technology a
few years ago and has no employees, Mr.
Bianco said. IDK’s owner, Joe Turi, will join
Infiniti. Mr. Bianco declined to say much
else about the company.
Mr. Bianco said Infiniti, with 20 employees
and about $4 million in annual revenue, is
looking at buying three other companies:
A local software development firm, a
New York-based IT staffing business and a
Texas company that provides IT security to
government agencies. He did not identify
any of them.
Broadening Infiniti’s lineup of products
and services would help it compete with
larger companies, Mr. Bianco said. He added
that he sometimes longs for the resources
he had when he was an executive for
Systemation, a Beachwood IT consulting
firm that was sold to Cap Gemini of France
in 1989.
“Having that bandwidth in the company
… made it so much easier to deliver solutions,” he said. — Chuck Soder
BEST OF THE BLOGS
Excerpts from recent blog entries on
CrainsCleveland.com.
Rad move:
Radisphere National Radiology
Group Inc. moved its Beachwood office from
Commerce Park to Park East Drive. The 70
people the company employs in Beachwood will
occupy most of the third floor at 3700 Park East,
which was occupied by Rosetta Marketing
Group until the interactive marketing firm
consolidated its Northeast Ohio operations in
downtown Cleveland. The 17,000-square-foot
space is roughly 50% larger than the company’s
previous office at 23625 Commerce Park.
operating officer for U.S.
operations, making him
the company’s No. 2
executive.
In the new role, which
he assumed last month,
Mr. Covey oversees the
company’s more than
7,000 U.S. employees and
Covey
all four of its divisions.
Those divisions include its residential/
commercial group and its utility services
division, which performs utility line clearance
work.
Davey Tree’s chairman, president and
CEO Karl Warnke, 60, was chief operating
officer before climbing to the top. Asked if
he aspires to the highest role, Mr. Covey
replied, “I’m going to do the best possible
job that I can do in this position, and then
we’ll see where the chips fall.”
Mr. Warnke became CEO in January 2007
and said intends to remain in the post for
awhile. He said Mr. Covey was promoted
because of his skill set and experience.
“He’s engaging, he is well accepted by the
people in the company here,” Mr. Warnke
said. “He has earned their respect, and I
think that is absolutely critical.” — Michelle
Park
responsible for 10.5 million jobs and generate
$1.2 trillion in total economic impact.
“The Economic Impact of Commercial
Airports in 2010” quantifies the economic
contributions of the 490 airports, which it
dubs “Airports Inc.”
The Airports Council reported that U.S.
airports have increased their total number
of jobs by 56% since the group’s last study
of airports’ total economic impact, in 2001.
The report finds the seven Ohio airports
are responsible for 136,000 jobs, $4.7 billion
in payroll and $13.6 billion in total economic
output.
■ Reuters reported that logistics firm
Panther Expedited Services Inc. of Seville,
in Medina County, is trying to sell itself,
three months after scrapping its IPO plans.
“Panther, owned by private equity firm
Fenway Partners, is being advised by J.P.
Morgan, which was one of the several
underwriters for the initial public offering,”
the news service reported, citing two people
familiar with the matter. The sources did
not want to be identified, as the sale process
was private.
■ Clevelanders, what do you have against
One source told Reuters that XPO Logistics
vacations?
of Buchanan, Mich., and several private
The Los Angeles Times took note of a reequity firms are eyeing Panther.
cent LivingSocial.com survey of 4,000 AmerA Panther spokesman declined to comment
icans about their vacation habits, in terms
to Reuters.
of how many vacation days they take
Panther filed for an IPO of up to $110
and how many foreign counmillion in 2010 but called it off
tries they have visited.
last November.
“Which city’s residents
The company provides
used the fewest days of vacay?
expedited transport services
Cleveland,” The Times said.
via ground, air and ocean
Cleveland residents “were
shipping. Its annual revenue
also the least likely of the rewas $142 million, according
sponding residents of the 20
to a summary about the comcities to travel outside the counpany on Fenway’s website. New
We Clevelanders can
try for vacation,” the paper reYork-based Fenway, with $2.1
nest with the best of
ported. “Can it be that the peobillion in capital under manage’em.
ple who live in the city at the
ment, invested in Panther in 2005.
mouth of the Cuyahoga River are just that
Its total investment in the company is $76
much more industrious than the rest of us?
million.
More satisfied with their lot in life?”
Maire Griffin, a spokeswoman for Living
Social.com, told The Times that Clevelanders likely are more comfortable with
“nesting” than people in other parts of the
■ A study released by the Airports Council
country, which prompted the story’s writer
International-North America contends that
to quip, “Clearly it’s time for me to visit
490 commercial airports in the United
Cleveland and discover its charms.”
States — including seven in Ohio — are
We must really
like it in NE Ohio
Study shows airport jobs
have soared in last decade
20120312-NEWS--20-NAT-CCI-CL_--
3/8/2012
10:26 AM
Page 1
Won’t cramp your legs. Or your style.
The new mid-sized 2013 Infiniti JX .
With sculpted looks and spacious seating for seven.
Now available at Airport Infiniti.
Airport Infiniti
13940 Brookpark Road
(just west of West 130th)
www.AirportInfiniti.com
855-220-5302
Vehicle release date: March 20, 2012

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