20160411-NEWS--1-NAT-CCI-CL_-- 4/8/2016 2:04 PM Page 1
VOL. 37, NO. 15 APRIL 11 - 17, 2016
FINANCE: Hurting the poor? Business of Life Critics take issue with Huntington’s deal P. 6 The Fixers Artists explore Cleveland’s FOCUS: Middle Market issues ahead of the RNC Paid sick leave is a growing concern P. 22 P. 17 The List SOURCE LUNCH CLEVELAND BUSINESS The largest commercial contractors Santina Protopapa on arts and education P. 27 P. 23 Who helps to fix Labor market is on the mend Fed chief Mester says challenges remain them? BY JEREMY NOBILE across the Fourth Federal Reserve District — which comprises all of [email protected] Ohio, western Pennsylvania and @JeremyNobile eastern Kentucky — following a Increasing stress being speech in Cleveland last Wednesday, As the top Federal Reserve official April 6. placed on caregivers is in Cleveland explained last week, it The good news is Ohio’s unem- was a long time coming, but Ohio’s ployment is now at 4.9%. labor markets have finally returned That’s a sharp decline from the big cause for concern to their pre-recession peak. 11% peak seen in December 2009 Although that bodes well for the during the height of the Great Reces- BY LYDIA COUTRE regional economy and generally in- sion. dicates a positive outlook for compa- Overall, the unemployment rate is [email protected] nies that are seemingly well staffed, one good indicator that business @LydiaCoutre there are still longer-run challenges here is thriving again. facing the business sector, said “But that doesn’t mean everyone When MetroHealth trauma surgeon Dr. Loretta Mester, president and CEO can get a job who wants a job,” Amy McDonald has to tell parents their child of the Federal Reserve Bank of Cleve- Mester said. has died, she wants nothing more than to sit land. Yet, with unemployment hovering with them, mourn with them and support Mester spoke with Crain’s about around Mester’s long-run level of them. labor market conditions in Ohio and SEE MESTER, PAGE 25 But then the next trauma victim comes in, and she has to help. “If I’m at work, and I have a pa- tient die, I can’t sit there and SparkBase closing grieve,” said McDonald, Metro- Health’s director of trauma in the intensive care unit. “I’ve got to move onto the next patient. What else can I do? You learn to start after long struggle compartmentalizing.” A culture of needing to be flawless, based company. invulnerable and strong has left those Lack of cash stifles SparkBase would’ve needed to emotionally draining cases largely undis- raise more capital to restructure itself, cussed, tucked away in the corners of care- effort to fix loyalty but it had a hard time finding willing givers’ minds alongside the daily stresses of investors with cash on hand, Haynes long hours, paperwork, self-criticism and card company said, noting that Glengary and many mounting requirements. The list goes on. other venture capital firms in Ohio The joy and passion that brought care- are out of cash. SparkBase’s complex givers to the health profession can be cast in BY CHUCK SODER ownership structure made that task the shadow of these stresses. more difficult, he added. [email protected] For decades, there wasn’t a space to dis- As for the company’s existing in- @ChuckSoder cuss or deal with these stresses, but in the vestors, they “didn’t want to write more checks,” he said. last several years, the issue is getting what SparkBase was in bad shape when Those financial issues caused the many say is much-needed attention. More Stephen Haynes took over as CEO two clients to leave, he said. When surveys and studies are looking into the is- last May. they did, Haynes decided that it sue, with many showing doctor burnout At the time, he thought the com- would take “too much time, too topping 50%. pany still had a fighting chance to much effort and too much money” Dr. Adrienne Boissy, chief patient experi- turn itself around by moving beyond to turn the company around. ence officer at the Cleveland Clinic, said its stagnant core business — pro- “This was a decision I was brought burnout comes in three main forms: emo- cessing gift card and loyalty card in to make. … I decided it wasn’t tional exhaustion, depersonalization and purchases. But he changed his mind worth it,” he said. SEE CAREGIVERS, PAGE 26 ISTOCK last month, after SparkBase lost two Over the past decade, SparkBase key clients. had raised nearly $9 million from a Entire contents © 2016 by Crain Communications Inc. On March 22, the company ceased long list of investors, including North almost all of its operations, laying off Coast Angel Fund of Mayfield 14 of its 18 employees. Those who Heights and more than 40 individu- remain aim to find a buyer interest- als. It also received $1 million from ed in acquiring the company’s soft- the Innovation Ohio Loan Fund as ware. They’re also supporting a few well as two Cuyahoga County loans remaining clients. totaling $790,000. In short, SparkBase “just ran out If the company can find a buyer of money,” said Haynes, who also for its software, any money it re- manages a local venture capital firm ceives would go toward paying back called Glengary, which owned a those government loans. The state is stake in the Midtown Cleveland- SEE SPARKBASE, PAGE 27 20160411-NEWS--2-NAT-CCI-CL_-- 4/8/2016 10:55 AM Page 1 20160411-NEWS--3-NAT-CCI-CL_-- 4/8/2016 2:03 PM Page 1
Classic Hyundai 49,%2",6$-%.4/2s1-866-212-2635
NEW 2016 HYUNDAI Per mo. $2,995 DUE $ 36 at lease signing (Cash or Trade!) Month *Lease Includes (10,000 miles/year - 20¢/mi. over) Lease** HMF leases plus taxes, title, license & $250 doc. fee. U *"7 , 7 "7-É " UÊ-/ / Ê, " “Valued98Owner Coupon” ", 0% APR For 72 ÃIII UÊ 9 --Ê /,9 -OR-“Competitive Owner Coupon” Save an additional $500! PLUS...$1,750 UÊ £nÓ® Please call for complete details.
NEW 2016 HYUNDAI $2,995 DUE Per mo. at lease signing (Cash or Trade!) TA *Lease Includes (10,000 miles/year - 20¢/mi. over) 36 HMF leases plus taxes, title, license & $250 doc. fee. $ Month UÊÇ»Ê/"1 - , Lease** UÊ "9- 99 UÊ 1*Ê ,Ê “Valued Owner Coupon” ", 0% APR For 60 ÃIII UÊ 1 /""/ Save an additional $500! PLUS...$500 UÊ £ÓÎx® Please call for complete details.
NEW 2016 HYUNDAI $2,995 DUE Per mo. at lease signing (Cash or Trade!) *Lease Includes (10,000 miles/year - 20¢/mi. over) 24 HMF leases plus taxes, title, license & $250 doc. fee. “ALL WHEEL DRIVE” $ Month UÊ/"1 - , Lease** UÊ "9- 129 UÊ 1*Ê ,Ê “Valued Owner Coupon” UÊ 1 /""/ Save an additional $500! UÊ £xÎή Please call for complete details.
NEW 2016 HYUNDAI Per mo. $2,995 DUE $ 36 at lease signing (Cash or Trade!) “ALL WHEEL D Month *Lease Includes (10,000 miles/year - 20¢/mi. over) UÊ 6/" Lease** HMF leases plus taxes, title, license & $250 doc. fee. UÊ / Ê-/ , 279“Valued Owner Coupon” WHEEL -OR-“Competitive Owner Coupon” ", APR For ÃIII UÊ / Ê- /- Save an additional $1,000! 0% 60 UÊ(K19378) Please call for complete details.
*Plus tax, title, license fees & Doc. fee. Prices and leases include all Hyundai rebates. Customer may be responsible for $400 disposition fee at lease end. **Special fi nancing pending credit approval w/HMF. See www.Driveclassichyundai.com or your Hyundai dealer for full details. ***Competitive Owner Coupon NOT combinable with Valued Owner Coupon. In-Stock only. Most competitive models. Excluding Kia. ***Military and/or College grad incentive requires proof. Sale Ends 4/18/16. www.DriveClassicHyundai.com
306 2 2 2
615
306
Drive .com 20160411-NEWS--4-NAT-CCI-CL_-- 4/8/2016 10:56 AM Page 1
PAGE 4 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS FOR LEASE CBS Radio dials up INDUSTRIAL BUILDING WITH GREAT HIGHWAY ACCESS 19801 HOLLAND ROAD • BROOK PARK, OHIO doubt for stations
BY KEVIN KLEPS each market individually,” Gorman WKRK, WNCX, WDOK and WQAL said. “What is the best deal in each reached nearly one million listeners • 95,013 SF warehouse/distribution [email protected] market, and who’s buying? It’s al- per month in the quarter, the ratings @KevinKleps most like I have a storage room full showed. Numbers such as that are facility on a 4.79 acre parcel of fax machines, but who’s going to why Harrison, the Talkers editor and 6)RIRIÀFHVSDFH Employees at the four CBS Radio buy them?” publisher, said radio isn’t sidling up • 25’ ceiling height stations in Cleveland received an to its death bed. email on March 15 telling them the “It still has life in it,” Harrison said • 12 docks; one (1) drive-in door Visit parent company was pursuing IPO ahead? of traditional radio. “It still has an TerryCoyne.com • Rail access (CSX) into building “strategic alternatives for its radio Another significant reason a sale audience of people who have grown Or call Terry at division.” 216.453.3001 of the radio stations might be less up with it and like it. It still generates • Heavy power/distribution The announcement was de- likely than it first appeared last ratings and revenue.” (1,600A/220-480V/3P) scribed as the “end of an era” by the month is by spinning off its radio But, he added, debt is a huge • Great location near I-480 and I-71 Los Angeles Times, and speculation properties, as CBS did with its Out- problem for the owners of far too was all over the map regarding the door division in 2014, the company many stations. That has resulted in 1350 Euclid Ave., Suite 300 future of the 117 stations CBS Radio could reap the tax benefits created financial cuts that have affected the Cleveland, Ohio 44115 owns in 26 markets. But, industry in- by an initial public offering. In a re- product, Harrison said. siders stressed to Crain’s, this move cent memo to staffers, CBS Radio “What is wrong with the picture is is anything but surprising during president Andre Fernandez, while too many stations operate with bud- uncertain times for traditional radio, not ruling out a sale of some or all of gets that are so depreciated that they as listeners spend more time on dig- the company’s stations, said an IPO can’t afford to do radio well,” he ital music, podcasts and subscrip- is the preferred move. said. “What adds to the problem is tion services such as Spotify and the fact that radio is not the most COLLABORATION Pandora. cutting-edge form of technology in John Gorman, a former WMMS- “Corporations are life as it is, so therefore it can’t afford FM, 100.7 program director, to be anything but its best. If it can’t launched oWOW, an internet rock afford to do even an average job be- station, in 2015. He compares terres- not necessarily cause of bad planning, that makes it trial radio to fax machines because unworkable.” he says it’s like a dated appliance in forthcoming with the digital age. “Let’s face it, radio as a platform is local branches. An ‘uphill battle’ worth less every day,” said Gorman, CBS Radio, while not debt-ridden who was with WMMS from 1973-86. That makes it like the industry leaders, isn’t with- “The revenues aren’t there anymore. out its problems. The company’s ra- With the switch over to digital, it’s difficult for people dio revenue dropped 6% in 2015, not going to come back.” and CBS took a $484 million write- Radio stations would argue that down on the value of its FCC radio with live streaming and shows being who work at a licenses, The Wall Street Journal re- offered as podcasts, they’re keeping ported. The four Cleveland stations, up with the times. But even the most company like CBS all housed at the Halle Building, did- ardent radio supporter would admit n’t experience the staff cuts that the industry is facing more than its 92 Credit Unions Strong when this kind of took place at several CBS Radio share of obstacles. $10,000,000 properties across the country last Loans up to Representatives from the four year, sources said. Cleveland CBS stations — WKRK- story gets out Commercial Real Estate Financing • SBA Loans CBS hasn’t given a timeline on FM, 92.3; WNCX-FM, 98.5; WDOK- Refi nancing Options • Construction Loans when it will decide on a sale or spin- FM, 102.1; and WQAL-FM, 104.1 — there. It’s an off, and sources said it could take a Contact Jonathan A. Mokri referred Crain’s to CBS’ corporate year or more. Gorman, who admit- 440.526.8700 • [email protected] • www.cbscuso.com office in New York. Karen Mateo, atmosphere of ted it took months for his internet CBS Radio’s senior vice president of SM radio station to get potential adver- The Power of Collaboration communications, said it was “very uncertainty.” tising partners to take it seriously, early in the process,” and that the said the web has changed everything company wouldn’t be commenting — Michael Harrison for traditional radio. beyond its initial announcement of editor and publisher, “It’s been an uphill battle for us, a possible sale or spinoff of the radio division. Talkers magazine but at least we don’t have the debt,” Should CBS decide to sell its radio he said of oWOW, which has office properties — either bit by bit, or in space in Cleveland’s Gordon Square one large chunk — the future of any Operating the radio division inde- Arts District. station would get more tenuous. pendently, Fernandez said in the “The great thing about online (ra- IMPRISE FINANCIAL Such a move or series of moves, memo, would make employee con- dio) is outside of our own investors, MANAGE RISK. MAXIMIZE WEALTH. however, might be the less likely sce- tributions “even more important.” we don’t have a lot of overhead. As nario, for multiple reasons. But converting its digital billboard long as we keep the lights on, we pay A big one is the list of potential business, CBS Outdoor Americas our employees and we have the WEALTH ADVANTAGE buyers is limited. The two largest ra- Inc., into a real estate investment equipment, we’re doing OK.” dio companies, iHeartMedia and trust hasn’t really paid off for share- CBS’ ultimate decision for its ra- Cumulus Media, are ridden with holders of the spinoff, Outfront Me- dio division, which has properties in Imprise Financial develops customized captive insurance programs debt and struggling with lofty loan dia Inc. The company’s stock is every top-10 market, could wind up down more than $9 per share, to being a positive one for the likes of VCKNQTGF VQ [QWT DWUKPGUUoU URGEKƂE TKUM RTQƂNG 1WT URGEKCNK\GF payments. $20.87 as of April 7, in the last year. WKRK, WNCX, WDOK and WQAL. programs provide coverage for losses that traditional insurance “Based on available capital and A high-level CBS Radio source in But corporate announcements companies cannot cost-effectively insure, including: based on the market of radio sta- tions today, it’s not like there are Northeast Ohio told Crain’s the four- such as the one made last month al- lines of usual suspects out there station Cleveland group is optimistic ways bring a ton of questions. Crime & Employee Dishonesty Loss of Key Talent waiting to buy up these stations,” about the possibility of an IPO, “Corporations are not necessarily forthcoming with local branches,” Cyber Risk Regulatory Risk said Michael Harrison, the editor which the source believes is the and publisher of Talkers magazine, most likely scenario. The four CBS Talkers’ Harrison said. “That makes Insurance Deductible Expense Supply Chain Interruption a leading industry trade publication. radio stations in Cleveland also tout- it difficult for people who work at a Loss of Key Customer Litigation Expense “That may not be the road available ed results from the most recent company like CBS when this kind of to them.” Nielsen quarterly, which showed story gets out there. It’s an atmos- Franchise Dispute Expense Reputation Risk In Cleveland, which Gorman said that WDOK ranked first among all phere of uncertainty. It becomes dif- isn’t a “growth market” for radio, the women listeners in the 25-54 age ficult to deal with people above you, CALL TODAY 877-220-0180 options for a potential sale are even group, and that 92.3 and 98.5 occu- people below you and someone in the media who presents a threat be- WWW.IMPRISEFINANCIAL.COM more scarce, the industry veteran pied two of the top three spots among men in the 25-54 demo- cause they don’t want to say any- © Imprise Financial PCC, Inc. 2016 said. “I really think CBS has to look at graphic. thing they’re not supposed to.” 20160411-NEWS--5-NAT-CCI-CL_-- 4/8/2016 2:05 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 5 Skyscraper intrigue swirls downtown
BY STAN BULLARD Conway wrote in an email, “S-W Whether the combination nets costs — from the proposed combi- to move. Akron-based FirstMerit has experienced dynamic growth more headquarters jobs in Cleveland nation, according to a Securities and Corp. also has a branch and some of- [email protected] over these past few years (i.e. nation- — and if so, how many — are obvi- Exchange Commission filing of the fices in the complex that total 9,000 @CrainRltywriter wide we open one new paint store ous questions that remain unan- conference call transcript. square feet, which may become every three-to-four days) which have swered. When an analyst asked The big proposed acquisition, as available through the bank’s pro- Before steel and stone can start re- resulted in more downtown jobs and about how many corporate costs well as a CEO transition to former posed merger with Columbus-based shaping downtown Cleveland’s sky- our need to expand into space in the could be cut in the consolidation chief operating officer John Morikis Huntington Bank. line with new office buildings, the adjacent Skylight Office building.” during a March 21 conference call, from long-term CEO Christopher Others note the company could more fundamental building blocks With the Valspar deal, Sherwin- Sean Hennessy, Sherwin-Williams’ Connor, surfaced since rumors start- do short-term leases in other spaces are tenants who will occupy, and pay Williams has said it intends to keep chief financial officer, said, “I don’t ed circulating in the real estate indus- for some workers. for, the space. its headquarters in Cleveland and think we’re ready to talk about any- try that the company had sized up Speculation about new skyscrap- maintain what it describes as a “sig- thing like that.” sites for a new headquarters down- ‘Intriguing’ opportunities ers is ramping up thanks to activities nificant presence” in Minneapolis. He said the company would not town. Insiders privately say the plans by two of downtown Cleveland’s At the same time, it has said it ex- elaborate beyond saying 42% of the have varied, but have ranged from Meantime, farther east on largest corporate citizens: Sherwin- pects synergies from combining with $280 million in cost savings it ex- 600,000 to 900,000 square feet in size. Prospect at the Rose Building, which Williams Co., which is working on an Valspar, with growth opportunities pects will be in the area of selling, Sherwin-Williams’ Conway argues is on the corner with East Ninth, acquisition that would make it the in product lines and globally, as well general and administrative expenses the company may be able to expand Medical Mutual openly discusses the world’s biggest coatings company, as efficiencies that will benefit the — which includes headquarters and within its footprint if law firms and options it is mulling. and Medical Mutual of Ohio. companies and their customers. a variety of other business overhead other tenants in the building decide SEE SKY, PAGE 27 Rico Pietro, a principal at Cush- man & Wakefield Cresco brokerage in Independence, believes it makes for additional excitement in the downtown market. “When you add Sherwin-Williams’ potential need with the Medical Mu- tual requirement, you could have two significant buildings come out of the ground in the next few years,” Pietro said, in addition to the proposed Nu- CLEus mixed-use project. “Wherever they go, you’ll see additional develop- How invested ment in that area.” Likewise, Kevin Piunno, a senior vice president at Cresco, said what happens if and when the companies set their course triggers many conver- is your bank in sations among office brokers. “Can you imagine Landmark as a mixed-use project with apartments and offices,” he asked, pointing to the follow-up opportunity — or liability your business? — if the paint company should move. At this point, what’s clear is both Sherwin-Williams and Medical Mu- tual may be too large to move into ex- Do they understand where you’ve been? Get excited isting empty office space, even with a 16% vacancy rate among top-tier about the potential of where you’re going? Do they buildings. Both also may be able to redo their existing properties to stay work with you to create unexpected solutions and put. However, each is also large enough to launch a real estate devel- stand by you every step of the way? oper’s project downtown or in the suburbs. Sherwin-Williams has 2,800 asso- ® ciates in 900,000 square feet of the At First Commonwealth Bank, we’re big on Cleveland company-owned Landmark Office Towers, 101 W. Prospect Ave. business. On helping them get started and keep Medical Mutual has a require- ment for 380,000 square feet, as growing. On providing products to keep their bottom much space as it has in The Rose Building, 2060 E. Ninth St., with line healthy. And building relationships so we can about 1,300 workers downtown. It also has 700 workers in Beachwood, customize solutions to address their needs and goals. Copley and Strongsville offices that it may consolidate together in some to-be-determined fashion. Because sometimes the best solution for the future of Leaving options open Ask Sherwin-Williams about a po- your business isn’t just another product. It’s a person tential headquarters project search and Mike Conway, director of corpo- willing to invest themselves in your success. rate communications, answers, “As- sessing space, land and building and new paint store location needs, is nothing new, something we’ve been doing for 149 years as part of our reg- ular business planning cycle.” Conway said the paint and coat- ings company’s focus is on conclud- ing the proposed acquisition of Valspar Inc. of Minneapolis. The $11.3 billion deal is scheduled to be closed early in 2017 if shareholders and regulators approve it. “It’s business as usual here at Landmark,” Conway said. However, the company for the EQUAL HOUSING Member FDIC first time last year leased 50,000 OPPORTUNITY fcbanking.com 800.711.BANK (2265) square feet across the street in the Skylight Office Tower, 1660 W. Sec- ond St. Sherwin-Williams would not disclose how many people or which of several teams it moved next door. 20160411-NEWS--6-NAT-CCI-CL_-- 4/8/2016 10:56 AM Page 1
PAGE 6 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS 62,878 SF of Warehouse & Offi ces Available for Sale or Lease Looming Huntington merger raises concerns Challengers argue the First Merit deal could harm poorer areas
BY JEREMY NOBILE solidation. cants and in poorer neighborhoods So far, Huntington has proposed regardless of any apparent compli- [email protected] the closing or consolidation of 107 ance with provisions of the Commu- @JeremyNobile branches in its combined eight-state nity Reinvestment Act and other 1657 Broadway Avenue, Lorain, OH footprint in merger applications regulations. Huntington Bancshares is push- filed with the Federal Reserve Bank Charles Bromley, director of the • 30,416 SF Warehouse Area • Excellent Surface Parking ing back against some challengers and the Office of Comptroller of the Ohio Fair Lending Coalition, which • 32,462 SF Offi ce Area • Located 10 mins from I-90 & questioning the bank’s pending Currency. is working closely with the NCRC • .73 Acres Ohio Turnpike merger with Akron’s FirstMerit At least 60 of those are in Ohio, and other groups to articulate cred- • Loading Docks & Drive-ins • 35 mins from downtown Corp. with 49 in Northeast Ohio, specifi- it needs to the Fed and Huntington, • Ceiling Height: 26’-28’ Cleveland While Huntington may disagree cally. Meanwhile, additional said the Fed commentary periods with some of the issues raised by are a chance to shed light on those • 2,500AMP/480V/ 3-Phase Power • Possible Lease-back branches will need sold to comply groups like The Ohio Fair Lending with regulators. lending issues. Coalition and New York-based OCC filings show Huntington is For example, in a lending analysis Hiedi Winston watchdog group Inner City looking to sell off branches repre- provided to the Fed, Inner City Press 440.752.2617 Press/Fair Finance Watch — who senting $600 million in deposits in said Huntington made 197 home [email protected] HannaCRE.com both argue the combination could the Canton market, or 43% of their purchase loans to whites in the result in more harm than good, par- total deposit base there, and anoth- Akron MSA in 2014. ticularly in some low-to-moderate er $50 million in the Ashtabula mar- However, it made nine to African income Ohio communities the ket. Americans and three to Latinos. In banks currently operate in — the Huntington provided a 42-page Cleveland that year, 582 home pur- groups say Huntington is at least response to Lee’s comments to the chase loans were made to whites, 37 hearing them out. Fed on March 31 through its law were made to African Americas and LANDERHAVEN Some of those neighborhoods, firm, New York-based Wachtell, Lip- nine were made to Latinos. like those in and around Akron and ton, Rosen & Katz, arguing cus- According to the most recent cen- Cleveland, are expected to see a re- tomers will benefit from an overall sus data, the Cleveland population is duction in branch locations as oper- extended network of branches and 52% African American, 33% white For life’s ations in the expanded Huntington ATMs while FirstMerit customers and 10% Hispanic. footprint are consolidated to will have access to more bank prod- The bank declined to comment most important achieve the cost savings that made ucts and services. for this story on its lending proce- the deal attractive to shareholders “The legacy customers of First- dures, including those tied to the moments. and executives. Merit Bank will also benefit from the CRA and Home Mortgage Disclo- Lawyer and Inner City Press exec- extended branch hours of Hunting- sure Act. utive director Matthew Lee, who ton Bank branches on Saturdays, But its law firm addressed them in regularly challenges bank mergers, and such customers in Ohio and a response to the Fed. has called the deal “one of the most Michigan will enjoy the added con- “Any implication in the March 19 negative bank proposals in years.” venience of Huntington Bank E-mail that Huntington Bank has He said that closing 100 or more branches co-located in local major engaged in prohibited discrimina- branches in the affected communi- grocery stores, which are open sev- tion in its home mortgage lending is New Image Photography ties could be as harmful “in its way en days a week and for longer hours unfounded,” the firm wrote before as the toxic drinking water in Flint, than traditional branches,” the law explaining its lending procedures Bar & Bat Mitzvahs, Birthdays, Anniversaries, Showers, Weddings. Mich.” firm wrote. and highlighting, among other Flexible event space with a variety of rooms and outdoor locations. Collectively, the challengers to the The firm also said that the 43 things, past community develop- CONTACT ONE OF OUR EVENT CONSULTANTS TODAY! deal take issue with the impact of branches proposed for closure so far ment loans made in the Akron and 440.449.0700 or [email protected] branch closures, the bank’s lending in Cleveland, Akron and Canton, Cleveland regions. procedures and Huntington’s finan- 74% are “short-distance” consolida- “This is our chance to hold them cial commitments to affected com- tions as defined by the OCC and accountable,” Bromley said. 6111 LANDERHAVEN DRIVE munities. within one mile or less from a receiv- “The most important thing is to CLEVELAND, OH 44124 Part of the Fed’s role in signing off ing branch. Of the total 107 pro- have a discussion with the bank on a bank merger is identifying the posed closing, 58% are considered about how they’re going to make public benefit. “short-distance.” credit available and how they’ll But reducing the branch network But Lee wasn’t impressed with the make their products available to the as proposed would make it harder response, calling its tone “dismis- underserved community.” for people in Akron and Cleveland sive.” And while Huntington, so far, has communities to access banking ser- In a reply, Lee points out that in committed $20 million to the Akron vices, Lee argues. selecting branches to close or con- and Canton communities and $5 “The harm of the branch closures solidate against the branch that million to Flint, Mich., Bromley said outweighs any benefit that can be would receive those customers, it’s not enough. shown,” Lee said. “It’s important Huntington is opting to shutter the The dollars also don’t address that this gets full scrutiny. As pro- lower income location, and there is overall lending practices he, and posed, this should be denied.” “nothing moving the other way.” others, are scrutinizing and suggest- If nothing else, Lee and the other “We will have more comments, ing need improved. groups involved, including the Na- but for now the comment period Notably, KeyCorp, in a partner- tional Community Reinvestment should be extended; evidentiary ship with the NCRC, announced in Coalition in Washington D.C., are hearings should be held; and on the March it is committing $16.5 billion urging the Fed to extend its com- current record, the application over five years to communities it mentary period beyond the current should not be approved,” he wrote serves — with a focus on eastern April 15 deadline by another 30 days in a reply to the Fed. New York — affected by its merger and hold public hearings. Regarding whether Huntington is with First Niagara Financial Group, Sources indicate the comment reconsidering what branches to the parent company of First Niagara period seems like it could be extend- close, Huntington spokesman Brent Bank. ed. But as of last week, the Fed, Wilder pointed out that 13 are in Of course, that commitment which makes that call, has not ap- designated low-to-moderate in- came five months after Key an- proved an extension. come communities and that “pro- nounced its acquisition plans, and posed branch actions are not final- Huntington’s merger was an- nounced just two months ago. Fighting branch closures ized and are subject to regulatory input.” Asked if Huntington is planning to Huntington CEO Steve Steinour make additional financial commit- has said the bank aims to cut First- ments, Wilder was unspecific, but Merit’s total expense base by 40% Lending criticized said the bank will “continue to make when the two expectedly merge Inner City Press, along with the proactive announcements about around the third quarter, with most Fair Lending Coalition, also call out commitments within specific com- of that coming from back-office op- the banks for what they deem as in- munities and more broadly across erations and a branch network con- adequate lending to minority appli- the enterprise.” 20160411-NEWS--7-NAT-CCI-CL_-- 4/8/2016 10:56 AM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 7
The Week CLEVELAND BUSINESS 700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-11230; Phone: (216) 522-11383; www.crainscleveland.com BEST WISHES THE BIG STORY Publisher/editor Elizabeth McIntyre Events manager Jessica Rasmussen CRAIN COMMUNICATIONS INC. Managing editor Events coordinator The Cleveland Convention Center, Kent State University president Bev- Scott Suttell Kim Hill Chairman Keith E. Crain Sections editor Integrated turned FirstMerit Convention Center erly Warren announced she has been Tim Magaw President Rance Crain Associate editor/Akron marketing manager Michelle Sustar Sue Walton Treasurer Mary Kay Crain of Cleveland, is now the Huntington diagnosed with breast cancer and will Managing editor, custom Assistant editor Kevin Kleps CIO Anthony DiPonio undergo surgery. In an email to the and special projects Amy Ann Stoessel Convention Center of Cleveland. Senior reporter Stan Bullard CFO Thomas Stevens Advertising director Huntington Bancshares Inc. on April 6 university community, Warren said Real estate/construction Nicole Mastrangelo Group publisher Mary Kramer announced an agreement between her medical team at the Cleveland Reporters Jay Miller, Government Senior account exec. Dawn Donegan Exec. VP/operations William A. Morrow Account executives Clinic has assured her that the cancer Chuck Soder Lindsie Bowman Exec. VP/director of FirstMerit Corp. and Cuyahoga County John Banks Technology strategic operations Chris Crain for the Columbus-based bank to offi- is “in a very early stage and that there Laura Kulber Mintz Dan Shingler Exec. VP/director cially take over naming rights for the is a high expectation for a full recov- Office coordinator Denise Donaldson Energy/steel/auto of corporate building as a merger between both ery.” Warren said she would remain * * * operations KC Crain Rachel McCafferty Web editor Damon Sims companies draws closer to comple- active and involved in the business of VP of production Manufacturing/energy Digital and manufacturing Dave Kamis tion. The company is taking on all the university throughout her recov- Jeremy Nobile, Finance strategy/audience terms of the original 20-year, $10.3 ery. She expects to have a reduced development director Nancy Hanus G.D. Crain Jr., Founder (1885-1973) Lydia Coutré, Mrs. G.D. Crain Jr., Chairman (1911-1996) Production director Craig L. Mackey million deal approved between county public schedule into May. Warren Health care Production assistant/ * * * th Reprints: 212-210-0750 council and the Akron-based bank joined the university as its 12 presi- Research editor Deborah W. Hillyer video editor Steven Bennett Krista Bora [email protected], that was announced last September. dent in July 2014 after having served Art director Rebecca R. Markovitz Billing Peter Iseppi Customer service and subscriptions as provost and senior vice president Cartoonist Rich Williams That agreement, which runs to 2035, Credit Rod Warmsby 877-824-9373 provides the county with $400,000 at Virginia Commonwealth University. annually over the 20-year period, plus regular adjustments for inflation, which brings the deal to more than $10 million over its lifetime.
CAN YOU GIG IT? Fairlawn City Council authorized a plan that involves installing a new high-speed fiber internet network and wireless access points throughout the city and the Akron-Fairlawn-Bath Township Joint Economic Development District. Fujitsu Network Communications of Texas will build the so-called FairlawnGig network. Extra Mile Fiber LLC of Dayton will serve as FairlawnGig’s anchor service provider. The construction project is slated to cost about $10 million.
PLANS ON TRACK An advance guard of more than 500 internet columnists; print, television and radio reporters; media executives and technicians who are leading the way for 20,000 of their media associ- ates on April 6 descended on Quicken Loans Arena to check out the logis- tics of the Republican Party’s presi- dential nominating committee in July. Republican Party officials laid out the plan for convention week. Jeff Larson, CEO of the Republican Committee on Arrangements, said he was confident PEACE OF M ND about the soundness of the security plan being put together. “I believe this will be one of the most secure con- ventions that we’ve had, but we’ll still allow people to get around and enjoy the things this city has,” he said.
NO TO NORTH CAROLINA Cuyahoga County Executive Armond Budish is taking a symbolic stand against anti-LGBTQ legislation passed in the state of North Carolina. In an April 5 executive order, Budish said no officer or employee of Cuyahoga County is authorized to approve any non-essential official travel to North Carolina. The order is a direct response to North Carolina’s “Public Facilities Privacy and Security Act,” passed on March 23 to counteract a civil rights ordinance passed in Charlotte earlier this year. See how happy employees make for a healthy business. A CLOSER LOOK At Aflac, we know keeping employees engaged never goes out of style. Which is why Directors of specialty transportation we offer coverage that extends to family members, with flexible enrollment periods and insurer National Interstate Corp. no invasive health screenings. And with One Day Pay,SM we make it a priority to pay claims appointed a special committee to as fast as possible — in 2015, Aflac paid 1.2 million One Day Pay SM claims. Because when consider a $30-per-share offer from See what Aflac can do for your American Financial Group Inc. to your employees are at their best, so is your business. acquire the shares of National Inter- business at aflac.com/peaceofmind state not already owned by American Financial’s Great American Insurance Co. subsidiary. Richfield-based National **One Day PaySM available for most properly documented, individual claims submitted online through Aflac SmartClaim® by 3 p.m. ET. Aflac SmartClaim® not available on the following: Disability, Interstate said the special committee Life, Vision, Dental, Medicare Supplement, Long-Term Care/Home Health Care, Aflac Plus Rider, Specified Disease Rider and Group policies. Aflac processes most other claims in about four comprises five of its directors: Norman days. Processing time is based on business days after all required documentation needed to render a decision is received and no further validation and/or research is required. Individual Company Statistic, 2015. Individual coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, individual coverage is underwritten by L. Rosenthal (serving as chair), I. John American Family Life Assurance Company of New York. Worldwide Headquarters | 1932 Wynnton Road I Columbus, GA 31999. Cholnoky, Patrick J. Denzer, Donald W. Z160115 3/16 Schwegman and Alan R. Spachman. At $30 per share, the deal is valued at about $293 million. 20160411-NEWS--8-NAT-CCI-CL_-- 4/8/2016 10:57 AM Page 1
PAGE 8 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS Round 1 ends, but battle looms FirstEnergy, following favorable decision from utilities commission, might be underdog in next bout
BY DAN SHINGLER ably national, too, before the Feder- peals, as expected. If that happens, on the price customers pay for gen- out. al Energy Regulatory Commission. lawyers will be throwing jabs about eration,” the utility added. “FirstEn- “However, pending complaints [email protected] “I think there’s a high probability how the PUCO is circumventing the ergy believes energy costs will in- filed with the Federal Energy Regu- @DanShingler FirstEnergy will lose when it goes to Ohio Legislature’s intention, in vio- crease in the future. Under the PPA, latory Commission (FERC) earlier FERC,” predicts Andrew Thomas, a lation of the state constitutions, with the company’s Ohio utilities will this year are a source of uncertainty FirstEnergy Corp. won its big longtime energy law attorney and an a few other hooks no doubt thrown help safeguard customers from fu- regarding the viability of the affiliate fight. Now it has to defend its title. economic researcher on energy in as well. ture rate increases by crediting cus- PPAs,” Fitch continued. “In addi- The Public Utilities Commission matters at Cleveland State Universi- The PUCO’s March 31 rulings on tomers’ bills when energy prices tion, Fitch expects parties opposing of Ohio on March 31 provided ty. FirstEnergy and Columbus-based rise.” the PPAs will seek a rehearing and, Akron-based FirstEnergy with a FERC has jurisdiction because AEP “continue an unwelcome trend ultimately, judicial review of the unanimous decision approving the FirstEnergy sells power from the of government intervention in com- PUCO order.” company’s proposed power pur- plants affected by the PPAs into the petitive markets, at the urging of the About those PPAs … In other words: Those PPAs are chase agreements. wholesale market, which is the fed- state’s electric utilities,” wrote the Meanwhile, environmentalists, nice, if you’re a FirstEnergy creditor, Because those PPAs include spe- eral agency’s domain. Thomas said Office of the Ohio Consumers’ other power generators, local gov- but get ready to watch them get as- cial fees put to ratepayers to guaran- FERC does not like anti-competitive Counsel. “As a result, several million ernments, green-energy advocates sailed in a variety of venues and tee the profitable sale of power from deals or transactions that are not Ohioans will pay a lot more for elec- and others are jumping onboard the courts and they could get thrown FirstEnergy plants to its distribution arm’s length. tricity than the market prices in- opposition train, either complaining out. arm, interests ranging from local Former PUCO chairman Todd tended by the state Legislature.” to FERC or threatening to take the Even some who have supported governments to other power com- Snitchler, who now consults with The Consumers’ Counsel contin- matter to the Ohio Supreme Court FirstEnergy’s argument before the panies and environmentalists cried power generators seeking to sell into ued, “It is difficult to connect the or the PJM Interconnection, which PUCO aren’t optimistic the compa- foul. The deal is anti-competitive the Ohio market, thinks FERC repre- dots between electric deregulation sets the rules for the electric grid ny’s victory will last. But, as in any and only ensures that dirty coal and sents the biggest threat to FirstEner- and market prices in the 1999 Ohio upon which FirstEnergy relies and case before a court or regulatory outdated nuclear plants remain on- gy’s PPAs, especially because com- law to making consumers pay for re- seeks a level playing field for all gen- body, no one is sure of the outcome. line longer than any invisible hand petitors are complaining that the regulation and subsidized power erators who use the grid. “I think it will more likely than not would allow, they contend. PUCO ruling upsets the wholesale plants in the decisions today. The Any of them could make utility be shot down,” said Matt Brakey, an But the PUCO sided with FirstEn- power market. FERC must waive Ohio Consumers’ Counsel has asked PPAs null and void. The energy and energy consultant to businesses and ergy. It agreed the plants are neces- some of its rules on affiliate transac- federal officials who oversee the na- financial world is certainly watching president of Shaker Heights-based sary to Ohio, in part because they tions for the PPAs to stand, he said. tion’s electric markets to protect to see what happens. Brakey Energy. “But the odds aren’t represent on-demand backup pow- “That case is one I think people Ohioans from paying subsidies for New York based Fitch Ratings is- much better than a coin flip.” er that could be needed again if, say, feel have very strong merits, and power plants.” sued a release on Monday, April 4, Snitchler basically agrees but is natural gas prices were to spike be- there’s a great likelihood of success For its part, FirstEnergy said the addressing the likelihood that reluctant to predict an outcome. cause fracking were banned. And in that case,” Snitchler said. “That’s PUCO ruling is legal and valid — FirstEnergy’s sweet deal will face po- What he is sure of, he said, is that that settled the matter. Or not. the one most industry watchers and should stand. tentially souring challenges. The Ohio’s electricity market will face Observers and industry experts think has legs.” “FirstEnergy’s Purchased Power PPAs, as they now stand, represent a more uncertainty for up to two years say a bigger fight now looms — and Agreement complies with existing “constructive credit development as the matter winds its way through the utility is probably the underdog. Federal Energy Regulatory Commis- for them and their Ohio-based utili- courts and regulatory agencies. FirstEnergy’s 18-month slugfest Connect the dots sion (FERC) rules that promote cus- ty and power generation subsidies,” That probably helps FirstEnergy, in front of the PUCO was brutal, and Even if FirstEnergy does survive tomers shopping for retail energy Fitch wrote. he said, because uncertainty will no doubt costly in terms of public an FERC fight, it probably will come supply,” the company said in a Of course, in a release headlined make it more difficult for competi- relations, advertising and lobbying. back home for a slugfest with heavy- statement. “Fitch: Ohio Affiliate PPAs May Face tors to make investment decisions It also might have just been a warm- weight lawyers before the Ohio “With the PPA, customers retain Further Scrutiny,” the way things about building new plants in Ohio up for the real brawl, or brawls, that Supreme Court, assuming the PUCO their ability to select a generation currently stand was not the issue the or that would sell into its electricity are to come. The next venue is prob- stands by its decision on any ap- supplier, and the PPA has no impact credit rating agency was pointing markets.
SALT • SALT • SALT • Water Softener • Industrial • Food • Ice Melt • Sea Salt Call For Pricing!! Minimum Delivery:1Pallet
SURF OR TURF? THREE COURSE SPECIALS • $29.99 Available Sunday through Thursday
Savor the aroma of our wood-fired Or delight in our Mixed Seafood grill uniquely preparing our two Grill featuring Chef’s choice of new, three course specials. Try fish, accompanied by Jumbo Shrimp our Charbroiled 10 oz. Certified and Sea Scallops with toasted Angus Rib Eye with garlic mashed almond mushroom wild rice pilaf, potatoes, vegetables, soup and vegetables, soup and salad bar. salad bar. FIND YOUR RHYTHM Reservations highly recommended.
10777 Northfield Road | Northfield, Ohio 44067 | 330.908.7625 | hrrnp.com
1-800-547-1538 For free, confidential help 24/7, call the Ohio Problem Gambling Helpline at 1.800.589.9966. Salt Distributors Since 1966 20160411-NEWS--9-NAT-CCI-CL_-- 4/7/2016 3:22 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 9 Nonprofits lean on efficient training BY LYDIA COUTRE “What we found is our [email protected] @LydiaCoutre disposals are going to be
From the moment a food item quite a bit less for the simple was donated to the Akron-Canton Regional Foodbank last year to the fact that we’re able to get time it was in the hands of those in need, it would sit in the foodbank’s things out in plenty of time volunteer center for 92 days, on av- erage. for our consumers to have But now, with the help of Lean Six Sigma training from Akron Chil- this product before an dren’s Hospital, the nonprofit can re- ceive, sort, inspect, pack and deliver food donations in about 39 days. expiration code may come “We’ve only been doing this pro- ject since the end of December, so I into play, or anything else.” think the more we get more people involved in this, I think that 39 days — Matt Petrick, … could be in the 20s,” said Matt senior manager of operations, Petrick, senior manager of opera- Akron-Canton Regional Foodbank. tions for the foodbank. Lean and Six Sigma principles — the idea of eliminating waste and re- said Mike Antochow, deployment be about $6,000 per person for the while needed improvement. With- ple what to do,” said Antochow, who moving variation, respectively, in leader for Akron Children’s Center training Antochow provided. out the hospital, the cost could have also is training several other food- different processes — have been im- for Operations Excellence, who pro- The children’s hospital provided been prohibitive, said Barb Hornick, bank employees for smaller projects plemented in many for-profit sec- vided the training to the foodbank. training and certification for free to the foodbank’s technology and op- on a different Lean Six Sigma level of tors, from manufacturing to health Many haven’t realized the bene- two staff members and helped the erations analyst, who went through certification. care to construction. But it’s not as fits or shy away from the cost of foodbank streamline processes that the training with Petrick. “We’re there to try to train and common in the nonprofit world, training, which Petrick said would officials there have known for a “We’re not there to try to tell peo- SEE NONPROFITS, PAGE 16
Upcoming Editorial Feature INVESTING GUIDE This annual section includes an anlysis of the past year’s top market performers. Issue date: May 30 • Ad Close: May 19 74% OF CRAIN’S READERS HAVE BUYING POWER. Book your ad today to get your company seen by this influential group!
Transform healthcare.
It takes strong leadership, collaboration across disciplines and creative thinking to face the challenges in healthcare today. You can lead the transformation.
Open to all experienced healthcare professionals, the Cleveland Clinic-Weatherhead Executive MBA at Case Western Reserve University combines Weatherhead’s breakthrough business concepts of leadership in management with Cleveland Clinic’s innovative approach to the business of healthcare to make this program the premier option.
APPLY TODAY AT WEATHERHEAD.CASE.EDU
CONTACT: Nicole Mastrangelo • 216.771.5158•[email protected] 20160411-NEWS--10-NAT-CCI-CL_-- 4/7/2016 4:20 PM Page 1
PAGE 10 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS Opinion
From the Publisher / Editor A shot of reality about stress in the workplace
Perspective can be a beautiful thing. I got a dose of much-needed perspective early in my career from my older sister, a registered nurse. I was reminded of that last week when I read Crain’s reporter Lydia Coutre’s story on caregiver stress. All jobs come with some level of stress. Mine became acute a month into my first job as a copy editor at the Lorain Journal, which at the time was an afternoon newspa- per. That meant the editing shift started at 5 a.m. Not only that, but deadline awaited the minute you walked in the door because the presses started rolling before 9 a.m. For a 22-year-old just out of college, I was- n’t completely unfamiliar with deadline pres- sure, having worked at the student newspa- Elizabeth per. But I wasn’t used to deadline pressure at McIntyre the ungodly hour of 5 a.m. I spent the pre-dawn hours, when I’d much rather be sleeping than spellchecking, writing Editorial headlines, fixing grammatical errors and sharpening syntax. One Thursday morning, the editor stormed into the news- room with a freshly printed paper in hand: “Who wrote this &#%!@ headline?” Now this particular editor was one of the most talented journalists I’ve worked with, but he also was one of the most profane, demanding and, at times, downright cru- Capital ideas el people I’ve known. Humiliation was one of the sharpest tools in his management toolbox, and as I raised my downcast eyes Phenom, a promising mobile app and social media com- This is not a new complaint. to the headline in question, my heart stopped. pany for athletes, made more noise on its way out of Cleve- Northeast Ohio entrepreneurs for years have lamented the I was about to be eviscerated. land than it ever did while it was here. lack of available capital here. There in big, bold type, was my work: “Council tables police But that’s OK. Complicating matters further of late is that LaunchHouse chef’s funding request.” Police chef, not police chief. I knew I The conversation articulated by Phenom founder Brian no longer is running its bootcamp-style startup accelerator was cooked. Verne in a piece in VentureBeat, and joined by others in the program (it continues to provide office space and educa- The stress made my voice quiver: “I wrote it,” I squeaked. He tech, entrepreneurial and economic development commu- tional programming related to entrepreneurship) and Biz- turned, narrowed his eyes, and paused. Slowly, a sarcastic smile nities, is a healthy development for a city that has made dom Cleveland late last year ended its accelerator program, crept across his face. His eyes locked with mine. “Don’t worry, strides in entering the new economy but still has much too. honey,” he oozed. “Only 30,000 people saw it.” He then threw work to do. Does Cleveland have the right mindset to support its the paper at me and walked away. Phenom recently left its home base in Cleveland to join the young companies? There are many tech startups and others I don’t know how I got through the rest of that workday. That highly praised 500 Startups business accelerator in San Fran- that have grown and thrived here, but Verne, who remains night, I fell apart. The tears started and didn’t stop for three days. I couldn’t believe I’d made such a boneheaded mistake cisco, where it can make valuable connections in the start- an advocate for the region, thinks we could do better. — and in my first month on the job! I even contemplated a ca- up-rich (and literally rich) Silicon Valley. “It is imperative that more investors in Cleveland empow- er smart young entrepreneurs who have the intelligence and reer change. Verne told Crain’s tech reporter Chuck Soder in February drive, but not the means, to build a great company,” he wrote Finally, on day three, I called my big sister, the nurse, and un- that the benefits of being part of a big-time accelerator in VentureBeat, undoubtedly echoing the feelings of the burdened myself. “How could I make such a mistake?” I sobbed. weren’t the only reason for the move, as he considered po- smart, young entrepreneurs this region needs to drive more “I’m so embarrassed. I want to die!” After patiently listening, she tential investors in Northeast Ohio too risk-averse to support growth. laid it on the line as only a sister can: “Yes, it was awful, but you a consumer technology company like Phenom. A well-timed event hosted by Jones Day, “TechniCLE need to learn from it and move on. It’s not the end of the world. Ray Leach, CEO of venture development organization Speaking 2016: Fostering Innovation,” takes place this Thurs- When I make a mistake at work, someone might die.” JumpStart, argued in pieces in this publication and Venture- day, April 14, and features a series of short talks and moder- And she was, of course, right. Health care workers, like my Beat that Phenom’s departure is a healthy sign for Cleveland. ated panel discussions. It promises to focus on issues includ- sister and millions of others, deal in life-and-death situations There’s “nothing upsetting” about Phenom joining 500 Star- ing “how to best support, position and leverage the local tech regularly. Those encounters take a toll, which is why it’s impor- tups, he wrote in VentureBeat. industry in the ongoing revitalization of Northeast Ohio’s tant that hospitals in Northeast Ohio and nationwide are offer- “In fact, the founders’ willingness to go where they have economy.” ing solutions to help caregivers manage the stress inherit in the best chance of success is exactly the kind of entrepre- One of the featured speakers: Brian Verne. Another is their profession. It’s not just about the consequences of mak- neurial hustle our city, state and country need right now.” Frank Sullivan, CEO of innovative manufacturing company ing a mistake. It’s about the pressures of providing care faster True enough. But Verne, again in VentureBeat, had a dif- RPM International and a longtime advocate of tech educa- to more patients, of needing to put on a veneer of invulnerabil- ferent take, writing, “The truth is, it is a problem that we left tion in the region. ity, of working long hours. Health care workers dedicate their Cleveland. We should have been able to find funding at the This is a chance for some of the region’s best minds to as- lives to the well-being of others. Their own well-being is vital, level and speed that would allow a promising startup to grow sess where we are and where we need to go. Figuring out how but it’s not as easy as “physician (or nurse, or respiratory ther- and compete. And while we did get some local backing, the to improve support for smart entrepreneurs will go a long apist, or X-ray technician) heal thyself.” funding ecosystem at large is so bureaucratic and slow-mov- way to making Northeast Ohio’s economy work better for all Our health care institutions and their leaders recognize that. ing that it’s more likely to kill than nurture startups.” its residents. Their employees, and in turn all of us, will be healthier for it.
PUBLISHER AND EDITOR: Elizabeth McIntyre WRITE US: Crain’s welcomes responses from readers. Letters should be as SOUND OFF: Send a Personal ([email protected]) brief as possible and may be edited. Send letters to Crain’s Cleveland View for the opinion page to Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by [email protected]. Please MANAGING EDITOR: Scott Suttell ([email protected]) emailing [email protected]. Please include your complete name and city from include a telephone number for CLEVELAND BUSINESS SECTIONS EDITOR: Tim Magaw ([email protected]) which you are writing, and a telephone number for fact-checking purposes. verification purposes. 20160411-NEWS--11-NAT-CCI-CL_-- 4/7/2016 2:30 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 11 START THE CONVERSATION PROM AND GRADUATION SEASON IS UPON US Take our parent-teen drinking and driving pledge today. Encourage your teen to make smart choices when it comes to driving safely. Letter to the Editor On behalf of Greater Cleveland Volunteers, I want time to thank all of its volunteers that help at a wide to bring attention to National Volunteer Week, April variety of organizations in the community. From tu- 10-16, 2016, and thank all the wonderful volunteers tors and mentors that help children in the schools, we have in Cuyahoga County. to dedicated meals-on-wheels delivery volunteers, National Volunteer Week began in 1974 as a way to caring individuals that comfort patients in hospi- to recognize and celebrate the efforts of volunteers. tals, hospices or nursing homes, and those that help Since then, the original emphasis on celebration has the unemployed find job, our volunteers make Cuya- widened. The week has become a nationwide effort hoga County a better place to live. Lt. Antonio Matos Lynette Blasiman to urge people to get out and volunteer in their com- National Volunteer Week is also a time to promote Post Commander Director munities. volunteerism and encourage more people to serve. Ohio State Highway Patrol Safe Communities National Volunteer Week is about inspiring, rec- If you have an interest but aren’t sure what volun- ognizing and encouraging people to seek out imagi- teer opportunities are available, look at our website: native ways to engage in their communities. It’s greaterclevelandvolunteers.org or call 216-391-9500. about demonstrating to the nation that by working together, we have the fortitude to meet our chal- — Joy Banish lenges and accomplish our goals. Executive Director TAKE THE PLEDGE elkandelk.com/drivesafe Each year, Greater Cleveland Volunteers takes this Greater Cleveland Volunteers
Financial Executives International Web Talk Northeast Ohio Chapter Re: Indians home opener according to the Brookings Institution — who subsidize and 2016 outlook drivers. Ohio spends more money mowing the lawns alongside roads than it does to support transit, but While it is greatly appreciated that the Indians added an we’re supposed to believe RTA is the real culprit. Leadership | Vision | Management extra game for the ticket exchange, we all learned the — Tim “buyer beware” downside of dynamic pricing. In ex- are what drive today’s CFO and their finance teams. change for a $100 Opening Day ticket, we will now get Ohio’s state-level transportation funding remains mired in two $20 tickets. While many will learn from this and not a long outdated, near-primordial pro-highway philosophy make that mistake again, the Indians will surely sell out that should embarrass us all. As noted in Crain’s wonder- FEI is the resource for senior-level financial executives! the home opener again next year. — Donald Sinko fully enlightened April 4 editorial, “Not fare,” the typical state provides 20% of the transit needs in their state, The Indians need to do three things to increase atten- whereas Ohio is at eight-tenths of 1%. Further, at least dance: 1. Lower ticket prices. The Indians doth protest 16 other states spend substantial additional state tax Join by April 30 and pay NO local membership too much when they say how “low” their prices are. Not revenue supporting intercity rail passenger transporta- so in the real world. 2. Win more games. They seem to tion as part of their efforts to provide a balanced, multi- fees for the first year and reduced national be working on this with some success. 3. They need a modal transportation matrix for all residents. Decades little luck. It always helps. I think their gradual phasing ago, many of my fellow transportation-improvement ad- dues of $399 - over $300 in savings! out of Chief Wahoo may help #3. — Seth Hirschfeld vocates and I responded to requests from a small group of Akron-area state legislators with information about Re: RTA’s budget crunch how states across the nation funded urban and intercity I would recommend that RTA take a look at its organiza- public transportation services. Failure of Ohio’s legisla- tion chart and take a meat ax to it. There are way too tors to constructively use this information produced the www.financialexecutives.org/join many departments and senior staff members. RTA does decades of inaction largely responsible for Ohio’s cur- To receive your reduced rate use promo code: CrApr2016 not need its own police force. Cleveland has a perfectly rent transportation funding fiasco. Throughout more re- good police force. I would also recommend that it shut cent decades, our annual urging of Ohio’s legislative and Questions? Contact us at 216.696.5501 down the ill-conceived Waterfront line. Most days and executive leadership to consult with their counterparts in times, no one rides it at all. Finally, I would observe that other states about transportation funding has been simi- every person in the county pays the tax that supports larly ignored. Is it too much to expect that this editorial RTA, yet very few of them use its services. Robbing will finally grab the attention of our state “leaders” about Peter to pay Paul is unsustainable in the long term, since the urgency of adopting more enlightened transportation Peter will just move to a “safer” location to avoid being funding priorities? Experience suggests the answer will robbed. Ultimately, the riders themselves need to pay be that it is too much to expect. Facts on the ground de- for the services they use, not the general population. mand that answer come in the form of legislative and — Henry Holtkamp executive action to meet the full range of Ohio’s urban and intercity transportation needs. This is such a baloney argument, with all due respect. — J. Howard Harding All those transit riders also pay for fancy highway expansions in suburbs they never visit. In the United Re: Source Lunch with Dominic Ozanne States, we share the cost of infrastructure. The gas tax, Dominic Ozanne has raised the standards in the which hasn’t been raised in almost 30 years, only pays design/build and general construction industry, and not for like 50% of the cost of interstate highways anymore. just for minorities. I have seen first-hand the Everyone’s taxes pay for stuff they don’t use. That does- professionalism he brings to the business. What is not n’t mean they aren’t good investments. The cities that apparent is his hands-on commitment to help small and are eating Cleveland’s lunch economically, like Seattle, minority businesses in the industry with mentoring and are investing huge in transit. Petty arguments against partnering. Being very involved in this facet, I see this as transit that amount to “I got mine” aren’t serving this re- a very important component to making this region grow. gion well. Where is our empathy for low-income workers? He recognizes how difficult the construction industry is — Angie Schmitt make a difference in! We all need to support these efforts. Thank you, Dominic. According to data from the Tax Foundation, gas taxes — Neil Dick and other user fees cover just 52% of the cost of main- taining Ohio’s road network. That means that 48% of the money spent on roads comes from the general funds of Re: Ruling favors utilities state and local governments, which is paid into by PUCO subsidizes FirstEnergy and AEP with job-killing everyone, regardless of whether or not they own a car. electrical rate increases that will harm all of Ohio’s Nine percent of Ohio households lack access to a car, a employers and, ultimately, every Ohio resident. This number that climbs to 24% in Cleveland, yet Henry Hold- multibillion-dollar drain on Ohio’s businesses will have kamp claims it is the drivers who subsidize transit and a more negative impact on Ohio’s economy than any not these individuals — 63% of whom are low-income, Ohio tax increase I can remember. — 203156 20160411-NEWS--12-NAT-CCI-CL_-- 4/7/2016 2:22 PM Page 1
PAGE 12 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS There is an art to what this BY DAN SHINGLER pocket — about four inches by five. His kit had all he needed to prac- [email protected] tice his wet passion on the road, ex- @DanShingler cept of course, for water. But then, Ferriot figured, who ever said you Who’s in the mood for a little art? had to use water? So he didn’t. He Because if your budget, or your sat at bars in New York and else- space, is too small to stretch for a big where on his travels and dipped his and pricey canvass, the solution brush in whiskey. Turns out, it not might be right under your nose. But it only worked great, but an artist did- might smell like Jack Daniels or John- n’t have to buy much whiskey when ny Walker; a group of distinguished producing little card-sized gems and artists known as Whiskey Painters giving them away to strangers at the can find a muse in any spirit. bar, either. And these masters of small pieces turn out some remarkable and col- lectible works, known as Whiskey State of the art Paintings. The works are created by The concept turned out to attract a national group of artists that got its some extremely talented and well- start in Akron. The Whiskey Painters known artists, and by the 1960s, the of America (WPA) club remains ac- club was formed. Its roster has in- tive and based in Silver Lake, and it cluded some great painters, and it just began one of its two annual still does. shows. The most famous probably is John Plenty of people have never heard Pike, known to most who have stud- of Whiskey Painters, Whiskey Paint- ied the art of watercolor for his ings or any association of whiskey teachings, books and materials, but and painting at all. Here’s what you also to admirers who frequent the missed: galleries of the Smithsonian or col- Way back in the days of men who lect his 20th century illustrations. were so mad that they would start There’s also Paul Strisik, a famous companies and still drink two marti- artist who worked in Rockport, nis at lunch, some of them were also Mass., and Middletown artist Marc crazy enough to want to paint a little Moon, another internationally during their liquid lunch. At least known artist who was a longtime they were after Akron industrialist member of the group before he Joe Ferriot, the founder of injection passed away in 2006. molding company Ferriot Inc., fig- Chagrin Falls’ Lois Salmon Toole ured out a way to do it. Ferriot pop- also is a noted artist who is an active ularized what became sort of the an- Whiskey Painter. And, don’t forget tithesis of “pop” art, called Whiskey Medina’s Fred Grath, says Ron Painting. Beahn, the current president of the Ferriot fitted a working pallet into Whiskey Painters of America. an aspirin tin, cut some brushes “He’s won many awards and is a down to ultra-portable size, and very, very accomplished painter,” sliced his pressed paper medium Beahn said. Whiskey Painters of America president Ron Beahn is also a collector of the unique art. (Dan Shingler) into pieces that would fit in a shirt Grath, like Beahn, is also not just
Smart Lending Solutions to help grow your business Liberty Express Loans for: • Purchas ng Eq ipm • Inventory • Working ca • Refinance cur We have m business with a 24 Contact one of our lending specialists today!
Jay Valerian Brandon Bucknell Senior Vice President Express Loan Specialist 216-359-5530 216-359-5520 [email protected] [email protected] A Partner You Can Bank On. www.libertybankna.com *Loans subject to credit approval and other program terms. 24 hours from time all information required to make a credit decision has been received. Excludes weekends and federal holidays. Term loans only. 20160411-NEWS--13-NAT-CCI-CL_-- 4/7/2016 2:23 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 13 group does with a drink a creator of whiskey paintings, but a can’t have anything for less than collector. $75, so they usually start at around “It’s a noteworthy organization $90,” Beahn said. But, with a couple that’s sometimes kind of overlooked hundred paintings in the whole by people,” Grath said. “They don’t show, there will be a wide variety of recognize the top-notch artists that prices, he added. participate. It’s not a novelty. Some There’s always a chance, too, that people might think it is, but it’s not a painting picked up at the show will to me — I collect the art myself.” rise in value. But Beahn advises buy- Their collectibility might be one of ers to simply buy what they like, the things that makes Whiskey without thinking of it as an invest- Painters so popular. Being small, ment. Most members of the WPA they don’t take up a lot of space, so have been painting for decades, he collectors can put many of them on said, so they are already well-known their walls — or even in books. And in art circles. they also don’t cost as much as larg- There is another way to invest in er paintings, making Whiskey the group, though. Beahn said the Painters accessible to more people. WPA is currently open to taking on For example, one of Grath’s full- one or two new members. It doesn’t sized paintings, on a canvas 32 inch- happen often, since membership es wide and 23 inches tall, will cost a has always been strictly limited to collector between $2,300 and $5,000, 150 artists (fewer than 300 have ever Grath says. But even his most expen- gotten in), but at the moment there sive Whiskey Paintings have sold for are a couple openings. less than $1,000, and most sell for Potential new members don’t $500 or less, he said. have to be world famous, but they should be competent artists. They should also be someone you might The price is right actually want to have a drink with, Pricing is a bit of a hot topic at the Beahn joked. moment, too. The WPA has two He’ll likely meet some new people shows annually — one in Northeast at the upcoming show, said Cuya- Ohio, and the other in Augusta, Ga., hoga Valley Art Center executive di- Beahn said. This year’s show at the rector Dave Whited. Cuyahoga Valley Art Center in Cuya- “We’re pretty excited about it. It’s hoga Falls began last Monday, April one of our best attended shows of 4, and runs through May 12. the year, and a lot of them are local Beahn, who also runs Ron Beahn artists,” Whited said. “We probably Custom Framing in Cuyahoga Falls, have about 30% of the artists walk has been busy painting and gather- their work in, and then we have oth- ing works for this year’s sale and ers who ship in stuff from all over the show. About 30 WPA members are country.” participating, and most will have He appreciates the small scale of eight paintings at the Cuyahoga Val- the work. ley Art Center, he said. Some will be “We’ve got a gallery full of paint- very affordable. ings, so it’s a good thing they’re “We have a standing rule that you small,” Whited said. Chagrin Falls artist Lois Salmon Toole created this whiskey painting of Cleveland. (Dan Shingler)
Let Nesco work for you. 20160411-NEWS--14-NAT-CCI-CL_-- 4/7/2016 3:46 PM Page 1
PAGE 14 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS TAX LIENS The Internal Revenue Service LIENS FILED unemployment Type: Employer’s withholding Date filed: Jan. 7, 2016 filed tax liens against the Amount: $7,978 Amount: $6,108 Type: Employer’s withholding Amount: $5,702 following businesses in the Caliber Jet LLC Brystil Inc. Cuyahoga County Recorder’s Special Transport & Rigging Inc. 4730 Warner Road, Garfield Heights 29550 Detroit Road, Suite 300, 5250 Transportation Blvd., Gala Catering Co. Office. The IRS files a tax lien Date filed: Jan. 6, 2016 Westlake Suite 10, Cleveland Pazzos Grand Ballroom to protect the interests of the Type: Failure to file complete return Date filed: Jan. 25, 2016 Date filed: Jan. 6, 2016 7874 Broadview Road, Parma federal government. The lien is Amount: $8,536 Type: Partnership income, quarterly Type: Unemployment Date filed: Jan. 7, 2016 Type: Employer’s withholding a public notice to creditors federal excise tax return Amount: $5,999 Amount: $7,383 Amount: $5,404 that the government has a Best Mens Wear Inc. 4227 W. 222 St., Fairview Park First Fruits Child Development claim against a company’s Date filed: Jan. 6, 2016 Elewski & Associates Inc. Center 1 property. Liens reported here Type: Employer’s withholding, 6833 Hillside Road, Independence 21877 Euclid Ave., Euclid LIENS RELEASED are $5,000 and higher. unemployment Date filed: Jan. 25, 2016 Date filed: Jan. 6, 2016 Type: Unemployment Type: Failure to file Dates listed are the dates Amount: $8,251 Americore Employment LLC Amount: $6,970 complete return 5933 Mayfield Road, the documents were filed in Amount: $5,800 Michael & Sons Landscaping Inc. Mayfield Heights the Recorder’s Office. Kenton Industries Ltd. P.O. Box 40422, Bay Village Date filed: Dec. 11, 2015 1455 E. 185 St., Cleveland Curious Minds Learning Place Inc. Date filed: Jan. 25, 2016 Date released: Jan. 25, 2016 Date filed: Jan. 6, 2016 420 E. 275 St., Euclid Type: Employer’s withholding, Type: Employer’s withholding Amount: $9,222
Atlantis Co. 105 Ken Mar Industrial Parkway, Broadview Heights Date filed: May 9, 2013 Date released: Jan. 8, 2016 Type: Employer’s withholding Amount: $33,151
Atlantis Co. P.O. Box 5047, Largo, FL Date filed: Oct. 1, 2013 Date released: Jan. 8, 2016 Type: Employer’s withholding Amount: $32,435
Avon Drive In Laundry & Dry Cleaning Co. 1830 Superior Ave. E., Cleveland Date filed: Nov. 10, 2011 Date released: Jan. 6, 2016 Type: Employer’s withholding 2016 CLEVELAND Amount: $34,872
B & I Automotive Repair Inc. 33200 Aurora Road, Solon HERITAGE MEDAL Date filed: Oct. 17, 2014 Date released: Jan. 6, 2016 BESTOWED UPON INDIVIDUALS Type: Employer’s withholding, WHOSE SIGNIFICANT CONTRIBUTIONS THROUGH corporate income LEADERSHIP, COLLABORATION AND SERVICE HAVE LEFT AN INDELIBLE MARK Amount: $13,227 ON ALL SPHERES OF THE CLEVELAND COMMUNITY. C & D Truck & Equipment Service Inc. 4015 Jennings Road, Cleveland MORTON L. MANDEL Date filed: Aug. 19, 2013 Date released: Jan. 6, 2016 Type: Employer’s withholding THE REV. DR. OTIS MOSS, JR. Amount: $29,582
California Ceramic SANDRA PIANALTO Supply Co. No. 211 19451 Roseland Ave., Euclid RICHARD W. POGUE Date filed: April 6, 2009 Date released: Jan. 22, 2016 Type: Employer’s withholding SEN. GEORGE V. VOINOVICH Amount: $7,834
California Ceramic Supply Co. No. 211 THE INAUGURAL CLEVELAND HERITAGE MEDAL 19451 Roseland Ave., Euclid WILL BE PRESENTED ON MAY 21, 2016 Date filed: Feb. 23, 2009 AT METROHEALTH GALA2016 Date released: Jan. 22, 2016 Type: Employer’s withholding To join us in the celebration, please call 216-778-7509. Amount: $5,369
Craig I. Smith an LLC Cleveland Heritage Medal Selection Committee: 2824 Coventry Road, Shaker Heights Deborah Z. Read , Esq., Thompson Hine LLP, Co-Chair Pamela B. Davis, MD, PhD, Date filed: Sept. 4, 2008 Ronald B. Richard, The Cleveland Foundation, Co-Chair Case Western Reserve University School of Medicine Date released: Jan. 6, 2016 Mitchell Balk, The Mt. Sinai Health Care Foundation Kristen Morris, Cleveland Clinic Type: Individual income tax return Julie Boland, EY Grafton J. Nunes, Cleveland Institute of Art Amount: $73,760 Akram Boutros, MD, FACHE, The MetroHealth System Rear Admiral Michael Parks, Dream on Foundation Inc. Margot J. Copeland, KeyBank Foundation The American Red Cross of Northeast Ohio 968 Bryan Drive, South Euclid John R. Corlett, The Center for Community Solutions Jerry Sue Thornton, PhD, Cuyahoga Community College Date filed: Sept. 3, 2015 Date released: Jan. 6, 2016 Type: Employer’s withholding Amount: $11,037 20160411-NEWS--15-NAT-CCI-CL_-- 4/7/2016 10:50 AM Page 1
Running a business isn’t simple. But choosing a wireless plan is.
Introducing the Verizon Plan for Business. One plan. Five sizes. Simply pick the right one for your business and switch it up anytime you like. Share your data across up to 25 devices, all with unlimited talk and text. And you can even pay for your devices up front or monthly. Getting on the best network has never been easier. Better matters.
Activation/upgrade fee/line: Up to $40. IMPORTANT CONSUMER INFORMATION: Corporate Subscribers Only. Subject to Major Acct Agmt, Calling Plan, & credit approval. Up to $350 early termination fee/line. Offers & coverage, varying by svc, not available everywhere; see vzw.com. Restocking fee may apply. © 2016 Verizon. 1.800.VZW.4BIZ | vzw.com/businesspricing 20160411-NEWS--16-NAT-CCI-CL_-- 4/7/2016 3:21 PM Page 1
PAGE 16 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS NONPROFITS CONTINUED FROM PAGE 9 ficer. Every morning, she’d walk scholarship dollars, Lombardo is coach folks to see that, ‘Hey, there’s through a hallway of boxes upon sending several staff members to another way of doing things,’ and boxes of material ordered through LeanOhio Boot Camp, a public-sec- then having them really drive the CleveNet (a consortium of libraries tor-tailored training through Cleve- improvements.” that share materials) but that hadn’t land State University’s Maxine Good- At any given time, the foodbank’s been shipped. Customers weren’t man Levin College of Urban Affairs. volunteer center used to hold getting their items as quickly as the Developing experts within the 180,000 pounds of donations. library would like, Lombardo said. staff instead of relying on outside Before items left the center after consultants is a smarter way to use three months of holding, volunteers taxpayer money and will help the li- would have to re-inspect the dona- “If you’re a nonprofit, brary apply the tools more regularly, tions to ensure the expiration date Lombardo said. hadn’t come around since the last you need to find inspection. Now that they’ve cut that storage time in more than half, ways to reduce Time is money that step is eliminated, and only At the foodbank, the training for 60,000 pounds are waiting to be the waste and Petrick and Hornick was a “huge sorted and inspected. the variation of time commitment,” but it was very “What we found is our disposals are helpful, and Hornick said she would going to be quite a bit less for the sim- processes even encourage other organizations to ple fact that we’re able to get things look into it. out in plenty of time for our con- more so because “If you’re a nonprofit, you need to sumers to have this product before an find ways to reduce the waste and expiration code may come into play, you may not have the variation of processes even more or anything else,” Petrick said. so because you may not have the re- The new process has a bonus of the resources sources that a for-profit organiza- improving volunteer experience. tion has,” Hornick said. Now volunteers can be more social, that a for-profit Antochow said Akron Children’s sit around a table and chat while Hospital has reached out to other they work. organization has.” nonprofits and is looking at provid- “It’s just a better feeling of team- ing more training, which proved to work,” said Hornick. — Barb Hornick, technology be incredibly helpful for him as well. Without training, Petrick and and operations analyst, Though he has been working with AVERAGE REVENUE OVER Hornick agreed they wouldn’t have Akron-Canton Foodbank the principles for years, teaching gotten to where they are today with- others the basics helped him take a $1,200,000 out the training. step back and learn new things he * “I think we were able to look at So the library brought in an exter- can take back to the hospital. · Option to Own or Lease Facility things with a fresh perspective,” nal consultant with Lean Six Sigma He’d encourage other experts Hornick said. “It was a tremendous- expertise. who spend all their time improving · Flexible, Rewarding Lifestyle ly productive exercise to do that.” The outcomes “exceeded our processes at their own organization · Vast Childcare Demand wildest dreams,” Lombardo said. to seek out similar opportunities to There hasn’t been an overnight car- train others. Building internal capacity ryover in at least two years. “Knowing that folks in Akron and A few years ago, the Cleveland Seeing the benefits of this project Canton now are going to benefit Public Library was struggling to fix and another that recently started, from that because there’s more food its processes and find efficiencies, the library has decided to train some available here in the community, said Cindy Lombardo, the library’s of its own staff. that’s definitely a very rewarding deputy director/chief operations of- With the help of state of Ohio thing as well,” he said.
Visit us at the Cleveland Franchise Expo April 16 & 17 • Booth #311/313 CONTACT US FOR A FREE ADMISSION COUPON MY FIRST JOB: REMEMBER YOUR KAFranchise.com/expo • (410) 941-0078 Crew member at McDonald’s *As reported by 75 mature academies in Item 19 of the current Kiddie Academy Domestic Franchising FDD. This DGYHUWLVHPHQWLVQRWDQRIIHULQJ$QRIIHULQJFDQRQO\EHPDGHE\DSURVSHFWXV¿UVW¿OHGDFFRUGLQJWRVWDWHODZDQGZKLFK MICHELLE PIERRE-FARID, complies with the FTC rule. VERY FIRST JOB? Chief Academic Officer for the Cleveland Metropolitan A strong experience there made it more School District likely you’d succeed at school and a career.
MY FIRST JOB: We’re leading youth workforce development Newspaper in Northeast Ohio: deliverer s%FWFMPQJOHUPEBZTUFFOTBOEZPVOHBEVMUT GREGORY FERRAZZA, into the region’s workforce for tomorrow Sr. VP for First National Bank s4FUUJOHPVSZPVOHQFPQMFPOQBUITUPTVDDFTT
MY FIRST JOB: Could be for your company.
Please consider providing a job for [email protected] this summer. Contact us. www.YouthOpportunities.org 20160411-NEWS--17-NAT-CCI-CL_-- 4/7/2016 2:25 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 17 Focus
MIDDLE MARKET ADVISER - P. 19 z TAX TIPS - P. 20 z Q&A - P. 21 Nothing to sneeze at Lack of paid leave to care for family, selves is a growing concern
BY LYDIA COUTRE States without paid sick leave, lost Health Affairs in March, found that adults with paid sick leave. go to an emergency room. You wages and concerns of being fired workers without paid sick leave are The cost of those decisions might need to get after-hours care [email protected] often loom over that decision, said 1.6 times more likely to forgo med- comes from two places, Stoddard- which is more expensive, or your @LydiaCoutre Patricia Stoddard-Dare, associate ical care for their family and three Dare said. condition got worse.” professor at the Cleveland State times more likely to forgo that care “It’s coming from wage loss and Offering paid sick leave can keep A child with cold or flu symp- University School of Social Work, for themselves when compared with then it’s also coming from your sick employees home, and there- toms on an early weekday morning who co-authored a study on paid working care, (which) becomes more ex- fore colleagues healthy and pro- leaves many parents with a choice: sick leave. pensive now because you delayed ductive, said Linda Quinn, associ- send their child to school sick or “So now, the well-intentioned it,” she said. “You might need to ate lecturer in Cleveland State’s take off work to take them to the mother might say the best thing for department of mathemat- doctor. my family unit is to send my child ics, who also co-authored If that mother or fa- to school sick,” Dare said. “I don’t the study. A paid sick ther is one of the want parents to be put in that leave benefit can add 49 million em- position.” job stability, help with ployees in the But many are. The study, employee retention, United released in the journal boost the mental SEE SICK, PAGE 18
We support over
800 BUSINESSES Buckingham, Doolittle & Burroughs LLC in Northeast Ohio just like yours. A Northeast Ohio Business Law Firm Akron • Canton • Cleveland bdblaw.com 20160411-NEWS--18-NAT-CCI-CL_-- 4/7/2016 2:25 PM Page 1
PAGE 18 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS MIDDLE MARKET ISTOCK SICK CONTINUED FROM PAGE 17 pear that countries that mandate on businesses may be able to indi- and physical health of caregivers paid sick leave are at a disadvan- cate how they could be affected by a and cut down on worker errors, ac- tage,” Stoddard-Dare said. mandated paid sick leave. cidents or injuries. In a statement, the Ohio Restau- Yet the United States lags behind rant Association said it recognizes it other nations: Of the 22 countries Industries hit hardest doesn’t want management or staff ranked highly in economic and hu- People working in the service in- coming to work sick, but a paid sick man development, it is the only one dustry, such as food service, health leave mandate would have a nega- that doesn’t mandate that employ- care, home health, and child or elder tive impact. ers offer paid sick leave. care, are less likely to have paid sick “When it comes to managing time Seventy percent of full-time em- leave — only 35.4%, according to the off and other work place issues, em- ployees in the country have paid sick study. ployers working in cooperation with leave benefits, while only 19% of Stoddard-Dare said if she eats at a their employees is a much better ap- part-time workers have this benefit, restaurant, drops her child off at a proach than a one-size fits all gov- according to the study, which has a childcare facility or is choosing a ernment mandate,” the statement third co-author, LeaAnne DeRigne, place for her elderly parent to reside, read. “One of the benefits of working associate professor at the School of “then I would want to know if those in the restaurant industry is the abil- It’s a small price to pay for unlimited access Social Work at Florida Atlantic Uni- employees have paid sick leave.” ity to customize one’s work sched- to the premier source of business news and versity in Boca Raton. In the service industry in particu- ule/shifts from week-to-week.” lar, Hamilton said employers are At the Cleveland Clinic, employ- information in Cleveland. balancing the cost of high turnover ees earn paid time off throughout Benefits that matter against the cost of not offering a to- the year, which they can take as sick The study controlled for various tal reward package, which includes days or vacation, said Guy Van GET YOUR DIGITAL SUBSCRIPTION TODAY: demographic variables, including a reasonable base salary and time Tiggelen, the Clinic’s executive di- CRAINSCLEVELAND.COM/3FOR30 gender, education levels and income off. rector of Total Rewards, compensa- brackets — people in all different “If you’re not offering a basic tion and benefit packages for em- sectors and with all different educa- competitive total reward package, ployees. tion or experience levels can be you’re going to have very high Because human capital is impor- without paid sick leave. turnover, which the cost of that may tant, offering a competitive benefits As many employers look to recruit more than offset not offering a small package is key — and the right thing younger workers, they find that paid amount of paid sick,” Hamilton said. to do, Van Tiggelen said. Sick em- HOW BAD IS THAT LEAK? sick leave is a key attraction as new- It becomes a “rational conversa- ployees should have the time to take er employees demand the benefit, tion” to see what the real costs of care of themselves, he said, and said Scott Hamilton, the Illinois- each are. should be able to stay home to avoid based North American managing di- Swathi Ravichandran, associate getting coworkers sick. rector of human resources and com- professor and program coordinator “But probably the most important pensation consulting for Arthur J. for Kent State University’s hospital- reason is because we are a health Gallagher & Co. ity management program, said hos- care organization, we’re really con- Quinn said it’s important that pitality workers tend to be part-time cerned about the patient,” Van paid sick leave benefits be offered in employees of small organizations Tiggelen said. “If a caregiver or em- the right way. Packaged PTO time, in that have fewer employees. ployee comes in who is sick, there’s which days off could be used for “These are not people that make a always that risk they could pass it paid sick leave or vacation, can leave whole lot of money,” she said. “Even along to either one of our patients, employees weighing a vacation later giving up that one shift is still a big or a family member or visitor who is in the year against taking care of deal. It affects whether they could with the patient.” themselves immediately, she said. maybe make rent or not. So it does The Visiting Nurse Association of Many employers say PTO pack- matter.” Ohio offers all regular employees ages can offer flexibility, ease em- paid time off. It allows the home ployer concerns about abuse of health employees, who spend much those sick days and offer a cost to The cost question of their time visiting clients, to feel Carey Roofing Corp. has eliminated asset damage due budget that benefit. Cost is a big factor for businesses comfortable staying home to take to a leaking roof with practical solutions since 1946. Stoddard-Dare said studies have deciding to offer the benefit, and care of their families or themselves, shown that abuse to be minimal, mandates are generally not support- said Gene Karlen, VNA’s chief hu- such as one in San Francisco, a city ed by the hospitality industry be- man resources officer. that has mandatory paid sick leave, cause of that, Ravichandran said. “It’s sort of that practice what you which found that though workers It’s the same argument that preach,” Karlen said. “We’re sharing www.careyroofing.com were allotted five to nine paid sick comes up during conversations that with our clients, and wanting days a year, most only used three about raising the minimum wage. As them to reach optimal health. So we and about a quarter used none. cities and states raise minimum like to have our employees focus on “Internationally, it does not ap- wages, the real, measured impacts themselves as well.” 20160411-NEWS--19-NAT-CCI-CL_-- 4/7/2016 2:59 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 19
ADVISER: Stacy Feiner Exit planning: It’s
all in your head Where does your business need to go? This thought keeps gnawing at you. You own a business — and you don’t have an exit plan. We can take you there. The legal and financial risks are sizable, but you keep saying you don’t have time. But it’s more than that. You know it, and I know it. It’s your business. It’s either im- Our attorneys combine trusted portant to you or it’s not. Leaving your business is emotion- legal services with an experienced al and you don’t want to face it. The business perspective to help way you see it, exit planning means you’re done, you won’t be important our clients reach their goals. anymore, your life is over. It stirs up fear and anxiety over what’s next, combined with the fact that you don’t know how to do it. You pacify yourself for the moment Stacy Feiner is a business by saying you’ll get to it later, but all psychologist and an executive the time and logic in the world won’t coach at BDO USA. penetrate the power of these fears. The truth is it’s all in your head. You’re facing a mental block when it what matters. Get a coach to be your comes to exit planning. You can’t ig- partner in this and help you build www.taftlaw.com nore it. the mental fortitude, stay focused, ANN ARBOR / CHICAGO / CINCINNATI / CLEVELAND / COLUMBUS / DAYTON / INDIANAPOLIS / NORTHERN KENTUCKY / PHOENIX If leaving something this substan- see things clearly, be bold in the way tial — something you built with you solve problems, and not become sweat and tears — to your children, a problem yourself. Every elite ath- to your employees or to a worthy lete has a coach. Ambitious business 35th Anniversary
35th Anniversary buyer is important then you know CLEVELAND BUSINESS owners should, too. VOL. 36, NO. 47 NOVEMBER 23 - NOVEMBER 29, 2015 35th Anniversary ALLYSON O’KEEFE, 37 Partner; PorterCLEVELAND Wright BUSINESS
VOL. 36, NO. 47 Allyson O’Keefe started her legal career at Porter Wright in 2004 after completingNOVEMBER a sum- 23 - NOVEMBER 29, 2015 mer internship there as a Case Western Reserve University law student. Since then, she has worked on many significant deals across Cleveland, including Flats East Bank, The PROMOTE. Metropolitan at the 9, Uptown in University Circle and Steelyard Commons, and has been pro- you have to wake up and do it right. moted to real estateALLYSON partner. O’KEEFE, 37 “Young professionals who live downtown are so excited about the city,” said O’Keefe, a Columbus native whoPartner; lived downtown PorterCLEVELAND for Wright 10 years before moving to Rocky BUSINESS River.USI “The onesNESS who aren’t from here are often more excited about it. When you move here from somewhere else, you don’t take it for granted.” VOL. 36, NO. 47 Allyson O’Keefe started her legal career at Porter Wright in 2004 after completingNOVEMBER a sum- 23 - NOVEMBERNOVEEMMBBEER 29,299, 2012015 When O’Keefe is not working or spending time with her husband and two children, she can mer internship there as a Case Western Reserve University law student. Since then, she has be found volunteering on the boards of nonprofit organizations and watching college football. worked on many significant deals across Cleveland, including Flats East Bank, The Metropolitan at the 9, Uptown in University Circle and Steelyard Commons, and has been pro- WHAT INSPIRES YOU ABOUT YOUR WORK? moted to real estate partner. Just seeing what Cleveland has gone throughALLYSON in the time O’KEEFE, that I’ve 37been here, there’s obvious- “Young professionals who live downtown are so excited about the city,” said O’Keefe, a ly a lot of excitement around real estate development. I started in 2004 when we were crazy Columbus native whoPartner; lived downtown Porter for Wright10 years before moving to Rocky River. “The ones busy with development. That was sort of the boom from ’04 through ’08. I saw it go through who aren’t from here are often more excited about it. When you move here from somewhere the downturn, then I saw it rise again, even stronger than before locally. else, you don’t take it for granted.” Allyson O’Keefe started her legal careereer at Porter Wright in 2004 after completingcompleettinngg a sum-ssuumm- When O’Keefe is not working or spending time with her husband and two children, she can MANY OF THE PROJECTS YOmerU W OinternshipRKED ON thereARE M asIX EaD Case-USE WesternURBANn P ReserReserveROJECveT SUniversity. IS law student. Since tththen,heenn, shshehee hhasaas be found volunteering on the boards of nonprofit organizations and watching college football. Here’s what it takes: THAT AN AREA OF EXPERTISworkedE? on many significant deals acrossss Cleveland,Cleveland, including Flats East Bank, TheTThhee Yes, definitely. Real estate isMetropolitan extremely interesting at the 9, Uptown because in everyUniversity rsitydeal Circleis differ- and Steelyard Commons, andd hashhaass beenbeeeenn pro-pro-ro WHAT INSPIRES YOU ABOUT YOUR WORK? ent. You can never get boredmoted because to real there’s estate so partner.much variety there, from tax Just seeing what Cleveland has gone through in the time that I’ve been here, there’s obvious- credits to historic renovations,“Young from professionalsground-up development who live downtown to rehab,own arefrom soso excited about the city,” said O’Keefe,OO’’KKeeeefee, a ly a lot of excitement around real estate development. I started in 2004 when we were crazy mixed-use to residential. Columbus native who lived downtown for 10 yearsyears before moving to Rocky River.Riveerr. “The“T“ThThe onesoonneese Let the Custom Reprint Department help you leverage this great press. busy with development. That was sort of the boom from ’04 through ’08. I saw it go through who aren’t from here are often more excitedxcited about it. When you move here fromm somewheresomomeewwhereere the downturn, then I saw it rise again, even stronger than before locally. Why not? HOW WOULD YOU DESCRIBelse,E YO youUR Ldon’tEAD EtakeRSH IitP forST Ygranted.”LE? I definitely believe in leadingWhen by example. O’Keefe I expectis not working the people or spending withding whom time I work, with her husband and two childchildren,dreenn, shshehee ccan MANY OF THE PROJECTS YOU WORKED ON ARE MIXED-USE URBAN PROJECTS. IS my associates, to work hard,be found and they volunteering see me working on the veryboards hard. off nonprofitnonprFor me,ofit it’s organizations all and watching collegeccoollleegge football.ffoooootball. THAT AN AREA OF EXPERTISE? about working hard and doing good work. Yes, definitely. Real estate is extremely interesting because every deal is differ- WHAT INSPIRES YOU ABOUT YOUR WORK? ent. You can never get bored because there’s so much variety there, from tax WHAT OTHERS ARE SAYIJustNG: WseeingHAT W whatAS IT Cleveland LIKE TO W hasORK gone WITH through hroughO’KEEF Ein O theN time that I’ve been here, there’sthheeree’’s obvious-oobbvvious-us credits to historic renovations, from ground-up development to rehab, from THE FLATS EAST BANK PlyRO aJ ElotCT of? excitement around real estatete development.development. I started in 2004 when wewe werew e crazyccrazy mixed-use to residential. “Allyson is extremely brightbusy and with quick development. witted, but Thatwhat was truly sort distinguishes of the boom her from ’04 through ’08. I saw itt gogo throughthhrroough from most successful attorneysthe downturn, is her exceptionalthen I saw it people rise again, skills. even She stronger has an than before locally. HOW WOULD YOU DESCRIBE YOUR LEADERSHIP STYLE? uncanny ability to encourage the ‘adversaries’ in her negotiations to work in I definitely believe in leading by example. I expect the people with whom I work, Start by getting your head in the concert with her to achieve win/win MsolutionsANY OF TtoH Edifficult PROJE Cproblems,”TS YOU W saidORKED ON ARE MIXED-USE URBAN PROJECTS. IS my associates, to work hard, and they see me working very hard. For me, it’s all Scott Wolstein, CEO of Starwood RetailTH APartnersT AN AR andEA O co-developerF EXPERTISE ?of the about working hard and doing good work. Step No. 2: Flats East Bank project. Yes, definitely. Real estatee is extremely interestinginteresting because every dealdedeaal is differ-ddiffer-r- ent. You can never get boredred— Lee because Chilcote there’s so much variety thethere,erree, ffromm ttax WHAT OTHERS ARE SAYING: WHAT WAS IT LIKE TO WORK WITH O’KEEFE ON credits to historic renovations,tions, from ground-upground-up development to rehab,reehhaabb,, fromfroomm THE FLATS EAST BANK PROJECT? mixed-use to residential. “Allyson is extremely bright and quick witted, but what truly distinguishes her from most successful attorneys is her exceptional people skills. She has an Reprinted with permission from the Crain's Cleveland Business. © 2015 Crain CommunicationsHO Inc.W W AllOU RightsLD YO reserved.U DESC RIBE YOUR LEADERSHIP STYLE? uncanny ability to encourage the ‘adversaries’ in her negotiations to work in Further duplication without permission is prohibited. Visit www.crainscleveland.com.I definitely #CC15040 believe in leadingding by example. I expect the people withh whomwwhhomm I work,rk concert with her to achieve win/win solutions to difficult problems,” said my associates, to work hard, and they see me working very hard.hardd. ForFFoorr me,mee, it’s alla Scott Wolstein, CEO of Starwood Retail Partners and co-developer of the about working hard and doing good work. Flats East Bank project. — Lee Chilcote WHAT OTHERS ARE SAYING: WHAT WAS IT LIKE TO WORK WITH O’KEEFE ON THE FLATS EAST BANK PROJECT? For more information contact “Allyson is extremely brightright and quick witted,witted, but what truly distinguishesdissttinnggguishhhehesess her game. Emotion and logic are excel- Reprinted with permission from the Crain's Cleveland Business. © 2015from Crain most Communications successful Inc. attorneys All Rights is reserved. her exceptexceptional ional people skillsskills.s. SShehhe hhahasassans an Further duplication without permission is prohibited. Visituncanny www.crainscleveland.com. ability to encourageourage #CC15040 the ‘adversarie‘adversaries’s’ in her negotiationsnegotiatioonnss toto workwwoorkorrkk in n concert with her to achievehieve win/win solutionssolutions to difficult problproblems,”blleemms,”ms,” said Scott Wolstein, CEO off Starwood Retail PartnersPartners and co-developerco-deveevelveloveellooppeer off thetthhe Flats East Bank project.ct. Take the helm — LeLee ChChilcoteC
Reprinted with permission from the Crain's Cleveland Business. © 2015 Crainrain Communicationsnss IIncInInc.nc.ncc.c AllAl RightsRig resereserved.rveddd. Krista Bora, Reprint Account Executive Further duplication without permission is prohibited. Visit www.crainscleveland.com.ww.crainscleveland.and.cndd..com..ccom.coom.om #CC15040 lent business partners. The psychol- [email protected] • tel 212.210.0750 ogy of business is about marrying You own the process. Avoid the your emotion with logic so you can risk of selling your company at a dis- look at whatever lies ahead with the count or saddling your successor same confidence you bring to every- with an underperforming company thing else you do in business. Dig by being at helm. into your psychology. Build your bench: Design your tal- ent management system to get top performance. Develop a working Step No. 1: knowledge of your people across the Get your head in the game enterprise so your talent decisions are always smart. Establish a philos- Business psychology goes deeper ophy, know-how, and processes to than strategy. It digs into your gut, hire the right people, provide them shoves a mirror in your face, and clear direction, and prepare them for challenges your thinking. When new roles as the company grows. emotion and logic come together, Enhance value: Form an expert Expertise Pays Off you make levelheaded, powerful de- team to build and drive the plan with cisions that put you in front as the you. Work specifically with a man- For more than 80 years, we have helped middle leader. agement consultant who will focus THYRL[JVTWHUPLZHJOPL]LÄUHUJPHSZ\JJLZZ Wind up: Don’t assume that exit- you on increasing profitable revenue ing a business is about winding by helping you define your strategy, -PUHUJPHS[H_0;HUKVYNHUPaH[PVUHSK\LKPSPNLUJL down. This couldn’t be further from improve operational efficiencies, en- the truth. Your most important job sure financial accountability and tap 7\YJOHZLHJJV\U[PUNJVUZ\S[H[PVU before transitioning the company to the sweet spot in the market. ;H_Z[Y\J[\YPUN new leaders is to position it for suc- Be transparent: Be transparent + Risk assessment/risk mitigation cess for another 30 years. about your plans for company’s fu- (\KP[[H_HUKHK]PZVY`ZLY]PJLZ Set up: As the business owner, ture after you leave. Transparency of you’ll want to set your successors up the vision will gain employee confi- 3L[V\YRUV^SLKNLL_WLYPLUJLHUKL_WLY[PZLILHU for success or you will want a buyer dence as well as mitigate the risk of HZZL[[V`V\YJVTWHU`»ZVWLYH[PVUZTHUHNLTLU[ to pay a premium for your company. employees “bailing out.” Often the A strategic plan and a financial com- future leader will have a bigger vi- HUKZOHYLOVSKLYZ mitment to a formal transition sion, more capital and an updated process allows you to drive the qual- strategy to stimulate growth in ways ity of what you walk away with and that benefit employees. what you are remembered for. Remember, get your head in the Step up: Exiting your business is game. Take control of exit planning. not business as usual. Just like build- Coach Tom Landry says it best, “A Cleveland | 216.363.0100 ing a new plant, installing a new ERP coach is someone who makes you do Canton | 330.966.9400 system or launching a new product, what you don’t want to do, who has Delaware | 740.362.9031 exiting your company requires capi- you see what you don’t want to see, Elyria | 440.323.3200 tal. Expect to make a capital invest- so you can become who you have al- Worthington | 614.781.6174 ment and add new resources to en- ways known you can be.” Business Advisors and sure your desired outcome. For this endeavor, perform like an Certified Public Accountants maloneynovotny.com Wake up: Look at the situation elite athlete. The psychology of your square in the face. You are letting go, decision rests squarely in your negotiating a deal, and redefining hands. 20160411-NEWS--20-NAT-CCI-CL_-- 4/7/2016 2:26 PM Page 1
PAGE 20 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS MIDDLE MARKET
SMALL Business is TAX TIPS: Carl Grassi Tax relief may be on the Big to Us! way for property owners Dramatic changes in the real es- The Middlefield Banking Company built our business on helping small business. tate market over the last decade have We will treat you with dignity and fairness, and give you the consideration you led to more frequent disputes be- tween property owners and tax au- deserve. Come over to a Community Bank that delivers: thorities regarding the appropriate value of real estate subject to real es- tate taxes. • Variety of Easy Checking Options • Real Estate & Equipment Loans A recent decision by the Ohio • Commercial Loans & Lines of • Capital Improvement Loans Supreme Court may make it easier for property owners to get some re- Credit • Investment Solutions lief when the value of the property has declined since it was acquired. Property owners are generally prevented from arguing for a lower valuation than that established by a recent purchase price for the prop- The Middlefield erty. In its recent decision, the court Banking Company considered whether an appraiser’s Carl Grassi is president of report could rebut the presumptive McDonald Hopkins LLC. middlefieldbank.bank validity of a tax valuation based upon a recent sale price. 888.801.1666 In this case, the property owner, undermine the validity of the sale which had purchased a Comfort Inn price. Northeast Ohio Region Offices in: Middlefield • Chardon • Newbury hotel in 2007, filed a complaint for Rather, specific information bear- Orwell • Mantua • Garrettsville • Cortland tax year 2009 seeking a reduction of ing on the question of recency, the Central Ohio Region Offices in: Dublin • Westerville the value assigned to the property arm’s length character of the sale, or from $3.49 million down to a little the voluntariness of the sale prof- more than $2 million. fered by an expert appraiser, At the Board of Revision hearing, through a report or testimony, may Facebook.com/CrainsCleveland the hotel owner’s expert appraiser be sufficient to successfully rebut the AT HOME. IN THE OFFICE. explained that the 2007 sale price of presumption of sale price validity. Twitter.com/CrainsCleveland $3.49 million was not representative At issue on this appeal was evi- AT THE GYM. ON THE GO. Instagram.com/CrainsCleveland of the property’s value. dence of recency, and, curiously, Specifically, the appraiser relied whether the transaction was at arm’s upon evidence indicating that the length. STAY CONNECTED. Comfort Inn hotel and other compa- With respect to recency, the court rable hotels were experiencing a pre- found compelling that a significant cipitous decline in revenue streams downward market shift for hotels from 2007 through 2009 based upon had occurred between January 2007 significantly reduced occupancy lev- and the Jan. 1, 2009, tax lien date. Because the appraiser convincing- els attributable to the economic ly articulated that a “softening” of crash in the fall of 2008. the market had developed between The Board of Revision found the the approximate time of the sale and appraiser’s report and testimony to the tax lien date, the Supreme Court be well supported and reduced the of Ohio held that the 2007 sale could property value from $3.49 million not be deemed recent relative to the down to $2.6 million. Jan. 1, 2009, tax lien date. The Board of Education appealed With respect to the arm’s length this decision to the Board of Tax Ap- transaction component, the owner’s peals. appraiser opined that the sale was The Board of Tax Appeals ac- not truly arm’s length because the knowledged the presumptive merit owner did not act as a fully knowl- subscribed to the 2007 sale price, but edgeable, typically motivated buyer. held that its “recency” was rebutted The appraiser reached that conclu- by information provided and relied sion based upon his finding that the upon by the owner’s appraiser, and owner paid too much given the ho- further reduced the property value tel’s ongoing performance issues at to about $2.53 million. the time of the sale. On appeal to the Ohio Supreme Possibly because the school Court, the central issue was whether board did not oppose that argu- the assumed validity of a property ment, the court held that an arm’s valuation based upon a recent sale length transaction had not occurred price can be rebutted by an appraisal and therefore the 2007 sale price report and testimony. was not representative of the tax The court first observed the gener- valuation. al rule that the presumptive validity The primary takeaway of this de- of the sale price may be rebutted by cision is that evidence proffered evidence showing that the sale is not through an expert appraiser can recent, not at arm’s length, or not overcome the presumption of sale voluntary. price validity even when the sale at The court then instructed that it is issue occurred only two years prior permissible to rely upon information to the tax lien date. contained in an appraisal report and Consequently, litigants challeng- testimony to conclude that the pre- ing the valuation of property based sumptive validity of the sale price is upon a sales price that is unrepre- not reflective of the property’s actu- sentative of the actual value of the al value. property would be wise to explore The court warned, however, that the reasons for that variance and ar- the mere fact that an expert has ticulate, through expert testimony, opined that the property value how such reasons diminish the should be reduced is not sufficient to property valuation. 20160411-NEWS--21-NAT-CCI-CL_-- 4/7/2016 2:26 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17, 2016 z PAGE 21
Budget Dumpster tackles trash problem with tech BY JUDY STRINGER “We don’t compare ourselves to Only a handful work nationally. Waste Management or Republic The broad reach coupled with val- [email protected] (Services),” Fenn said. ue keeps customers like Kathy Houle “We are more like an Expedia, Or- coming back. Not so long ago, before the likes of bitz or Priceline or Hotels.com She’s a project coordinator for Expedia and Hotels.com, shrewd where we work with a bunch of dif- Centennial, Colo.-based Inre Media, consumers had to connect directly ferent vendors, hundreds of vendors which installs multimedia equip- with airlines and hotels to find the nationally, and offer (consumers) ment at hotels, convention centers right fit. The same could be said of different pricing and terms.” and resorts. Dumpsters. Campbell and Fenn grew up to- It relies on Dumpsters to haul Getting the right-sized Dumpster gether in West Park. away the packaging materials and rented for the right amount of time The duo initially started a bou- any debris from retrofits. — for a kitchen remodel or cleaning tique real estate firm, with Campbell Houle regularly calls Budget out grandma’s house — required selling and Fenn marketing, before Dumpster with quote requests for calling three or four different refuse transitioning into a junk removal projects across the country — many collectors. The bigger companies of- with a company they founded called at the same time. ten had higher charges or shorter Cleanup Contractors. Nally said the company operates rental periods, while the smaller “People kept calling and asking for in 150 U.S. markets, including most players weren’t staffed with cus- Dumpster services and not the labor of the bigger metropolitan areas. tomer service reps to man the we provided,” Campbell said. “So, a Currently, its biggest markets are At- phones. light went off in John’s head.” lanta and Chicago, but the company “Most of these companies, their Today, at about 1,500 boxes per is seeing large gains in Southern Cal- business is set up to deal with big week, the idea appears to be a good ifornia and all across the South, contractors, big construction com- one. In the last three years alone, Mark Campbell and John Fenn of Budget Dumpster. (Contributed photo) where DIY projects can go on “365 panies,” said Mark Campbell. Budget Dumpster has seen rapid in- days a year.” Neither large nor small haulers, he creases in sales and employees. ster transaction. Smaller haulers nesses, the benefit is a simpler and Now that is has a national foot- said, are structured to cater to “the Revenues grew from roughly $10 don’t typically have big marketing often less costly rental experience. print, Budget Dumpster’s focus is person who might not know every- million in 2013 to nearly $30 million departments or budgets. The large volume of requests gener- honing in on its existing relation- thing there is to know about renting last year. Contracting with Internet-savvy ated by Budget Dumpster allows ships with haulers. a Dumpster.” To date, Campbell said the com- Budget Dumpster gives them access haulers to bring down their prices, “A lot of these guys, at first they re- Campbell and brother-in-law pany is up another 40% in 2016. to customers they might not reach said Sean Nally, who works in the ally don’t know who we are or what John Fenn launched Budget Dump- Employment, which now hovers otherwise. company’s marketing department. we do, but as soon as they see the ster in 2005 to do just that. at about 60 full-time staff, grows by “We are a sales arm of their organ- Budget Dumpster passes the saving type of business we can bring, obvi- The Westlake company has no about 10-15 people each year, he ization,” Campbell said. And, big on to its customers. ously they value our relationship on Dumpsters of its own. It contracts said. companies see the Westlake firm as While there are similar “Dumpster a different level,” Campbell said. with haulers all over the county to The partners attribute much of “a consistent stream of business,” brokers,” in the marketplace, most “It gives us a unique opportunity take the hassle out of Dumpster their success to alleviating pain Fenn added. are local or regional, according to to explore ways we can bring more renting. points on both sides of the Dump- For consumers and small busi- Finn. business to them.”
Q & A: Amit Patel & Naman Desai co-founders, Quo Tech innovators Amit Patel and Naman Desai had already helped friends and families find places to live for years, so it only felt natural to marry that experience with their collective backgrounds in startups to launch a new business. Just like that, Quo was born. It’s an on-demand service that helps prospective renters identify apart- ments by pairing people with local concierges who in turn help those users with everything from schedul- ing viewing appointments, cleaners and movers to acquiring insurance. Launched in Cleveland in March 2015 and soon after expanded to New York City and Chicago, the year- old business has drawn at least 50,000 apartment seekers. The founding duo has raised more than $350,000 for their business and working toward a $1 million goal. Crain’s spoke with Amit and Namaan about their first year, what they’ve learned along the way and how innovation has played a role in their early success. — Jeremy Nobile Amit Patel Naman Desai
Why did you want to start were fortunate to see solid trac- cyclical — it ramps up over the I’ve learned that continuous net- proving the experience. the company here as opposed tion, steady growth, and public re- summer — we tested out taking work and warm intros to investors Naman: I can’t imagine being creat- to anywhere else? lations that met or exceeded al- summertime reservations during are key in order to keep growing ing a technology-assisted solution Amit: I’m a Clevelander, born and most all of our growth targets. the winter months. That was a the business. for this process without having raised. I love this place. This is defi- Now we want to improve the mem- huge success and something we’ll Naman: I went through Techstars spent significant time as a nitely one of the best cities to start ber experience through a more ro- continue to emphasize. We tested NYC with ClassPass. It was a great concierge, and frequently perusing a company given ability to quickly bust technology platform that cre- out a few guerilla marketing tech- experience and conditioned my our concierge interactions. It’s im- test and validate your concept, ates interactions that are easy, niques, such as posting witty ads mind in a number of ways. For ex- portant to be connected to both timely, and goal oriented. on Craigslist, which is still the go-to stay lean and create awareness to ample, always keeping an eye on the process, and hiccups that slow Naman: We are also building out destination for many apartment how people are using your product. it down, as well as the renter’s a tight community. tools and assistance for our hunters, but that proved to not be You might think they’ll love X but if mindset. Finding an apartment is an concierges so that they’re an effective method of acquiring you see them using Y more, that’s emotional process and you can’t Aren’t there similar services equipped with domain knowledge users. worth digging into. It’s important to separate that from the experience. to Quo already? How do you to make them even more proficient be passionate about your idea but separate yourselves? in serving members. Finding a new Both of you have worked with also open to different ways of ad- Where does Quo go from Amit: Nobody offers an end-to-end home is a big decision and having a past startups, some of which dressing the problem you’re trying here? What can we expect apartment search concierge experi- knowledgeable assistant on your went well and some that didn’t to solve. We frequently take a step next from you two? ence, and our carefully tailored, side is a tremendous help. pan out. What’s something back to make sure we haven’t Amit: We are in the process of concierge interaction differentiates you’ve learned from those past missed something. building out an app that will add to us from the search sites. Our As you’ve made traction experiences you apply to Quo? the speed and efficiency of our concierges are dedicated to making with the startup, what Amit: I went through the Launch- So both of you are still involved service, but in a very natural way. sure renters land the best apart- strategies have worked and House accelerator with another with that granular work, too, Using technology to facilitate the ment for their needs. And they which, perhaps, haven’t? startup and I learned a great deal taking calls and talking to rental process in real time will allow aren’t beholden to other motiva- Naman: We’ve spent a lot of time from the program. They pressed customers? us to provide a higher level of serv- tions, which is frequently the case testing different channels and hard on the customer development Amit: We really enjoy being ice to even more renters. Speed with others in this industry. measuring how they work. Our digi- approach from Steve Blank (who concierges as we get to learn ways and quality are two metrics we fo- tal ad strategy has become more launched the lean startup move- to improve the process for our cus on, and the app is built around Let’s be candid. How has the efficient, and we’ve also been able ment), which is what we’ve applied team and enhancing the member those pillars. We want to scale the first year gone for Quo? Where to devise a corporate partnership to Quo. I was also able to meet and experience. It’s a way for us to un- business and continue our growth do you want to improve? strategy that keeps us in front of network with the local investor derstand what can we innovate in into other highly transient markets Amit: The first year was a great potential renters without being ob- community. Unfortunately, Tagora the process and build underlying such as San Francisco; Los Ange- success. We validated our model trusive. Because renting in New didn’t pan out since I wasn’t able to technology to make our business les; Washington, D.C.; Austin and and demonstrated a market fit. We York City, Cleveland and Chicago is secure the right talent and funding. more efficient to scale while im- more. 20160411-NEWS--22-NAT-CCI-CL_-- 4/8/2016 10:57 AM Page 1
PAGE 22 z APRIL 11 - 17, 2016 z CRAIN’S CLEVELAND BUSINESS Business of Life Artist’s projects get to heart of issues
BY JAY MILLER
What should visitors to Cleveland for July’s Republican National Convention see and hear about the city’s assets and challenges? Artist Kate Sopko and a group of filmmakers are asking that question to a group of Cleve- landers who are active in a range of civic ven- tures and asking for their answers in the form of tours they would give RNC delegates if they had the chance. The films, combined into an installation Sopko calls “The Fixers,” will be available at SPACES Gallery in the Flats this summer. The films also will be available online through the gallery’s website, and Sopko is working on in- stallations in places where convention dele- gates will stumble across them. “We’re trying to make it as accessible as pos- sible,” the Garfield Heights native said. “A con- vention is a moment where we galvanize around higher-level politics, and Cleveland has a landscape that has a lot we can say about pol- icy being effective or ineffective, (trying) to serve people’s needs.” As it’s a work in progress, Sopko was reluc- tant to get into details, but she’s planning for the films to cover seven or eight issues, such as school policy and infrastructure needs. Sopko Still images pulled from the trailer for “The Fixers.” also realizes that, given the time pressures vis- itors will face, her work may have a broader im- pact on Cleveland-area residents. Each film will have anywhere from three to 20 interviews with people who are knowledge- able and insightful about the film’s issue. For each film, the interview subjects were chosen, and the interviews were guided, by a person who is well-networked around the particular subject matter. The cost of the project, which Sopko pegs at a little under $25,000, is being underwritten by SPACES; Art Matters, a New York foundation that supports artists who are pushing aesthet- ic and social boundaries; and an online crowd- sourcing site called Hatchfund. This is not Sopko’s first foray into what she calls social practice, or public works of art. “Public work has the possibility of just shift- ing the way we think about our world and the way we interact with our world, the way we re- late to other people,” she said. “We’re setting the table so people can talk to each other about getting interested in the city.” Sopko, a 2000 Kent State University gradu- ate, said she has been working seriously as an artist for five years. Before that, she worked as an arts administrator, at SPACES and else- where, and done what she calls, “kitchenwork,” or work that she continues. She sees her arts administration experience as critical to the kind of art projects she under- takes. “You’d be surprised at how much art work is administration,” Sopko said. “It’s managing and scheduling people and you have to figure out how to ship work, insure work.” Among her recent projects is a series of what she calls “forts” — places people have created for centuries — that answer questions about the things people value enough to defend. She also has an ongoing project called “City Repair Cleveland,” that brings people together to find ways to improve their neighborhoods. “The Fixers” will be exhibited at SPACES, 2220 Superior Viaduct, from May 20 to July 29, and at Smack Mellon gallery in New York City from June 18 to July 31. The preview trailer can be seen at https://vimeo.com/156270302. 20160411-NEWS--23-NAT-CCI-CL_-- 4/8/2016 10:58 AM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17. 2016 z PAGE 23 BUSINESS OF LIFE Source Lunch Santina Protopapa has a passion for using the arts to educate. As executive director of the Progressive Arts Alliance, a program that combines art and STEM (science, technology, engineering and math) education, Protopapa leads the small staff of employees and contractors who works with students in local schools. The program has grown since it began in 2002 and now serves five schools in Cleveland, one in Garfield Heights and two in Warrensville Heights. In March, the alliance took a project to share at SXSWedu, inspired by an installation done at Cleveland’s Mound STEM School. There, students worked with artists to create an LED light and sculpture installation on clouds. The students had already been learning about both clouds and circuits, and this project combined the two. Santina Protopapa — Rachel Abbey McCafferty EDUCATION
How has the program How is the alliance different What do you think is the role evolved over the years? from an extracurricular arts or of arts in education? FIVE THINGS: STEM program at the schools? Over the years, PAA’s The arts play an essential role in MUSICAL TALENT programming has evolved by Progressive Arts Alliance’s providing a robust curriculum for effectively adopting and arts-integration programs are students to develop the critical Outside of work, adapting emergent trends in different than extracurricular arts skills needed to be successful in Protopapa plays the education. When we launched in or traditional STEM programs in the 21st century. Each art form vibraphone and DJs — 2002, STEM and the Maker that we custom design experi- provides students an opportunity vinyl only, no laptop. She Movement were not a part of the ences that provide equal weight to develop critical thinking and thinks collecting music education field. As we’ve grown in an art form and in an aspect of listening skills, refined attention and “finding those hidden over the years and deepened our the STEM curriculum. These to detail, and design thinking commitment to partnering with programs are designed to use skills that are essential to any gems” is the best way schools, we’ve maintained a niche meaningful inquiry to deepen career path. A well-designed to learn about music. in teaching and learning that students’ understanding in core learning environment for students harnesses the current trends in curriculum content. Our artist-ed- includes a transdisciplinary LISTENING TO? LUNCH SPOT the field. We’ve accomplished this ucators accomplish this by curriculum in which the arts are La Bodega by operating as an arts-integration applying the principles of project- not only offered as stand-alone Afro-Cuban jazz, Latin jazz 3859 Superior Avenue lab in which our artists engage in based learning to our work. This subjects, but are also seamlessly and classic ’70s salsa Cleveland R&D that allows them to develop results in students demonstrat- integrated into other areas of the 216-331-3001 innovative projects and the ing an increased capacity to core curriculum. MOST MEMORABLE labodega-tremont.com corresponding curriculum to articulate comprehension of CONCERT engage students and their grade-level content. Students What role do the arts play in Stevie Wonder’s Songs in teachers in Cleveland classrooms. also walk away with new techni- your life, outside of work? The meal Through our lab approach, we are cal and creative skills that can be I’ve been involved in music ever the Key of Life tour at able to iterate and refine these applied to a variety of contexts. since I can remember. Learning to Madison Square Garden A Greek salad (the 55) projects as part of our ongoing play an instrument taught me and a tomato-mozzarella school partnerships. After we How does the work of the how to be a good student and BEST LOCAL SPOTS sandwich with chips (the iterate our prototypes in local alliance fit into the students’ developed my perseverance. I am 40), both with water schools, the refined work becomes day-to-day education? so grateful that I was able to Johnny Mango World Café model projects or curricular units PAA maintains ongoing partner- take music lessons starting in & Bar, Gust Gallucci Italian that we share with the national ships with a number of Cleveland kindergarten. Music really helped Foods and Siam Cafe in The vibe education field. As a result, schools. These partnerships me develop my leadership skills. Cleveland, as well as The Superior Avenue we’ve discovered that our work enable our in-school workshops Once I began studying and location is decorated not only has a transformative Calhoun Record Shop in to be custom-designed to align learning to play jazz, I was able to with local art. It has impact on students, but also Akron with the curriculum that students develop creative problem-solving ample seating and impacts the professional are working on at that moment. skills that play a role in every natural lighting in its two development of classroom After students work with their aspect of my life. Jazz also FAVORITE CITY dining areas. teachers and professional artists. teachers to learn a new concept, taught me how to collaborate LANDMARK they turn around and work with with others. Outside of work, I try Terminal Tower. Protopapa PAA’s artists-educators to apply to immerse myself in experiencing The bill that new knowledge to large-scale and learning about music and its said she lives downtown projects that challenge them to cultural context whenever I have and loves learning about $21.97, plus tip collaborate and problem-solve the opportunity. the city’s history. with their peers. 20160411-NEWS--24-NAT-CCI-CL_-- 4/8/2016 11:56 AM Page 1
June 22, 2016 Cleveland Metroparks Zoo | Stillwater Place 3900 Wildlife Way, Cleveland, OH 44109
In Northeast Ohio, there are thousands of family businesses both large and small. Crain's Family Business Forum will convene 200+ business owners to discuss the unique challenges they face. The Forum’s goal is to create an LU]PYVUTLU[MVYVWLUKPHSVN\LHSSV^PUNWHY[PJPWHU[Z[VL_HTPULOV^VWWVY[\UP[PLZHUKJOHSSLUNLZHɈLJ[MHTPS` members, non-family employees and ultimately, the bottom line.
2016 Agenda 2015 Sponsor Testimonials 8:00-8:45am - Networking/Registration/Breakfast “We were ecstatic to be a partner on a creative 8:45-9:45am – Keynote Speaker program which was on point for the business 9:45-9:15am – Networking Break owners in our area. You and the Crain’s team are really making a positive change for our 9:15-10:15am – Tracks #1 / #2 community.” Track #1: Succession Planning for Current Generation Owners – Fairport Asset Management Track #2: Succession Planning for Next Generation Owners 10:15-10:30am – Networking Break 10:30-11:30 Noon – Tracks #3 / #4 “I thought the entire conference was very well done, and probably something that could be Track #3: Your Family Business Support Team repeated next year. Family businesses are a Track #4: Family Business or Business Family? hot button for people; they’re an emotional issue for many and it seemed the interest in 11:30-11:45am – Networking Break general was high.” – Weston Inc. 11:45-1:00pm – Family Business Owner Networking Luncheon
For registration information and sponsorship opportunities, visit CrainsCleveland.com/FamilyBiz 20160411-NEWS--25-NAT-CCI-CL_-- 4/8/2016 2:05 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17. 2016 z PAGE 25
Mobility issues further compound it could accelerate as companies Manufacturing — which makes the problem. Despite a presence of compete for talent. up about 15% of the Ohio economy MESTER renowned companies with high- According to the PNC survey, compared with 10% across the na- paying jobs, like those provided by though, that may not happen imme- tion — health care and professional CONTINUED FROM PAGE 1 bulk of those positions tend to be in Cleveland’s strong health care in- diately. services are expected to lead Ohio’s 5%, it seems the challenges facing technology and skilled positions. dustry, many skilled workers in the The survey notes that only 23% of job growth, according to the report. companies today are deeper than “But we’re hearing from a swath of Midwest are being trained here, Ohio respondents expect to increase But the region’s remaining unem- monetary policy may be able to af- contacts in service sector industries then moving away. employee wages this quarter, which ployment issues are more structural fect. that even with the occupations that Those kinds of issues can’t really is down from 36% in the fall and 26% today, or deeply rooted in other Some employers are still finding it are considered lower-skilled posi- be addressed through monetary pol- from last spring. problems, than cyclical, meaning difficult to find workers, particularly tions, they’re having trouble finding icy, Mester said. “The expectation is that as we based on the business cycle, Mester for more highly skilled jobs. In Ohio, workers,” Mester said. “Once you have this high-skilled continue on and labor markets im- said. That’s a shift compared with that tends to be more weighted to- The fact that even some service group of people, we have to try to do prove — and I expect more improve- the years immediately trailing the ward skilled manufacturing and and retail companies report difficul- things to keep them in the city,” ment over the year — we will see last recession. construction jobs, Mester said, but ties finding workers while unem- Mester said. “Even though your in- more upward pressure on wages,” And that’s significant, Mester even some service sectors are facing ployment is low points to a broader nate population isn’t growing, there Mester said. said, because monetary policy can problems. issue, too. are things you can do to keep people The outlook for the economy is have little effect on structural prob- It’s a trend reversal from past For one, Ohio and the rest of the here. If you look downtown, you see still rather positive, she said. Labor lems. years. Midwest face the challenge of low a lot of development going on, and markets will continue improving, An oil well worker laid off by the For example, bankers a few years population growth, Mester said. that’s reflective that we have a lot of and wages should go up. sink in prices simply isn’t going to ago struggled to find compliance of- Ohio’s population has been growing potential here.” And businesses are generally still transition to a skilled nursing job, for ficers. Today, they report more is- at less than 0.4% a year through the optimistic, said PNC economist instance. It’s that mismatch be- sues in filling teller positions. Even past five years, which is about half Mekael Teshome. The PNC report tween skill sets creating the structur- some retail companies are having the rate seen in the nation as a A positive outlook shows that Ohio’s small and midsize al issues in this region. trouble filling general staff positions. whole, she points out. It’s also con- Mester said more employers are businesses are cautious about the Hiking interest rates won’t help The struggle to find workers is a siderably slower than the western offering increased incentives and re- next six months, but they still expect retrain workers, but the right kind of sentiment punctuated in a recent and southern regions of the United tention packages to keep workers stable sales and profits despite programs can. survey by PNC Financial Services States. around. And while wage growth greater pessimisms about the econ- “As a country, we need to figure Group, whose April 2016 economic The slow population growth is a seems slow right now — which omy, which seem tied to stock mar- out how to do that in an efficient outlook report found that nearly 40% likely factor in some businesses fill- Mester said could be a result of com- ket lows and rhetoric of presidential way that’s not burdensome to busi- of Ohio businesses respondents say ing what are considered lower-skill panies thinking that even if they pay candidates. It’s almost as if busi- nesses,” Mester said. it’s harder to find qualified employ- positions — there simply are fewer more, they won’t attract the people nesses expect to do well despite the “I think we should be able to do ees compared to a year ago. The people. they want because of a skills gap — greater economy, he said. that.”
ADVERTISING
Crain’s People on the Move promotional feature showcases Notheast Ohio job changes, promotions and board appointments. Guaranteed placement in print, online and in a weekly e-newsletter can be purchased at www.crainscleveland.com/peopleonthemove.
ACCOUNTING FINANCIAL SERVICES HOSPITALITY & TOURISM Charles L. Ratner Darren Zeck Michele Clark
Senior Director Mortgage Lending Officer Director of Marketing RSM Liberty Bank Executive Caterers and Landerhaven
Charles Ratner has joined RSM’s Washington National David has joined Liberty Bank as a residential Michele Clark has been named Director of Marketing Tax team as a senior director. Ratner has 30 years mortgage lending officer. He will focus on developing for Executive Caterers and Landerhaven. Clark was of experience providing estate and business succes- home loans in Cuyahoga and Lorain counties. David Vice President Event Marketing for US Concepts/ sion planning services to closely-held companies and life insurance has 20 years of home loan experience. Liberty Bank is a full-service Saatchi & Saatchi in New York where she was responsible for executing consulting services to corporations and individuals. He is a graduate community bank headquartered in Beachwood. Learn more at high profile national promotions. In CLE she created and led the Event of the University of Massachusetts and Emory University School of www.libertybankna.com and Meeting Planning Institute at Tri-C for 10 years. She comes at a Law. He is a Chartered Financial Consultant (ChFC), a Chartered Life time when both Executive Caterers and Landerhaven are heading in a Underwriter (CLU) and an Accredited Estate Planner’ (Distinguished). new direction by their alliance with award winning Chef Dante Boccuzzi.
For more information or questions regarding advertising in this section, please call Lynn Calcaterra at 313-446-6086 or email: [email protected]
Contact: Denise Donaldson Copy Deadline: Wednesdays @ 2:00 p.m. Phone: (216) 522-1383 All Ads Pre-Paid: Check or Credit Card Fax: (216) 694-4264 E-mail: [email protected] CLASSIFIED BUSINESS SERVICES BUSINESSES SPORTS & Extend the Life of your FOR SALE ENTERTAINMENT C. W. JENNINGS INDUSTRIAL EXCHANGE ROOF Global Expansion Consulting (4) 2016 FLYNN Commercial/Industrial Cleveland Browns Construction • Acquisitions ENVIRONMENTAL Roof Restoration. 1/3 the cost of 1st Mortgage Opportunity UST REMOVALS • REMEDIATION replacement. FREE Inspection Report Season tickets Exporting • Financing $900,000.00 -- 3-Year Loan DUE DILIGENCE INVESTIGATIONS Excellent seats, www.buildingretrofit.com 9.25% Cash on Cash Return (855) 707-1944 (800) 690-9409 (216)533-0563 Section 133, Row 4. New Daycare Facility 440-487-3030 Center St./Bellflower Rd. BUSINESS SERVICE OWNERS! Mentor, Ohio Submit your business card to promote your service Call Rick Jr. for Information Classified Ads To find out more, contact Denise Donaldson at 216.522.1383 440.951.1111 WORK!
Volume 37, Number 15 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copy- Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland right © 2015 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. Business, 1155 Gratiot Avenue, Detroit, Michigan, 48207-9911, or email to [email protected], or call 877-824-9373 (in the POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. U.S. and Canada) or (313) 446-0450 (all other locations), or fax 313-446-6777. 1-877-824-9373. REPRINT INFORMATION: 212-2210-00750 20160411-NEWS--26-NAT-CCI-CL_-- 4/8/2016 11:49 AM Page 1
PAGE 26 z APRIL 11 - 17. 2016 z CRAIN’S CLEVELAND BUSINESS
CAREGIVERS “I said, ‘Don’t be CONTINUED FROM PAGE 1 cording to a national study by TINY- lack of personal accomplishment. pulse, which helps track workplace ashamed that you get In his State of the Clinic speech issues like happiness and engage- earlier this year, Clinic CEO Dr. Toby ment. The study, released in March, Cosgrove highlighted concerns that also found that on a scale of one to emotional. This is very roughly half of caregivers and physi- 10, health care employees rate their cians reporting unreasonable stress. work-life balance at 5.87, while all He said the system is planning town other industries average 7.02. difficult. The day you hall meetings to address caregiver “Many of us work long hours, and stress, which is a “major concern,” we sacrifice time that we could be should worry is when it not only for the Clinic but across all spending with our families in order health care delivery. to take care of others,” said Dr. Northeast Ohio hospitals have Robert Richardson, elected presi- doesn’t bother you.’ ” programs to help caregivers talk dent of the medical staff at St. Vin- about and manage their stress and cent Charity Medical Center, who — Dr. Alfred Connors, systems to identify stressed physi- acts as the physician representative chief quality officer, MetroHealth cians. They continue to look for on St. Vincent’s board of directors. ways to reduce stress for caregivers To top it all off are the driven per- and ensure they are accessing the sonalities the health care field often supports they need. attracts. As a group, physicians are “If we can give tools to people so predisposed to burnout, Adan said, they can reclaim their love, their noting that many are compulsive per- passion, their enthusiasm of being a fectionists and can be guilt-ridden. health care provider, then it’s phe- “The culture of being a physician more supervisors referring physi- cope or responding to code calls, sends interventions, such as counsel- nomenal and everybody will benefit doesn’t emphasize at all taking care cians than self-referrals. In the past such as cardiac arrests. ing or spiritual care, to patients and from it,” said Dr. Francoise Adan, of yourself and emphasizes being 18 months, that has flipped. Nurses, supervisors, a staffing sec- caregivers. In a world where people medical director for University Hos- superwoman or superman,” Adan Though the portion of Metro- retary, a physician and others gave see death and dying every day, it’s a pitals Connor Integrative Medicine said. “That all combined really puts Health’s medical staff accessing the her small group a mix of experi- busy service, Boissy said. Network and its SMART (Stress them at risk of burnout.” program has remained steady, more ences. The younger participants Because physicians don’t typical- Management and Resilience Train- St. Vincent, like most hospitals, and more are coming on their own, turned McMullen onto smartphone ly show vulnerability, creating a cul- ing) program. has a system in place to identify identifying they need support, which apps that offer background music ture that promotes that is key after burnout. A health and wellness com- is an encouraging sign, Smith said. for meditation. In turn, she gave so many years of not acknowledging Compounding stressors mittee at the hospital investigates Case Western Reserve University them her best stress relief tip: step- there was a problem, Boissy said. reports of physician impairment, in- is looking for ways to get ahead of ping outside for a walk. Cosgrove focusing on the issue at his The past several years of health cluding substance abuse, emotional provider stress, said Dr. Steven Rica- The fellowship those group class- State of the Clinic and beginning the care reform have exacerbated stress problems or stress, Richardson said. nati, assistant dean for student af- es offered made her realize she was town halls are good steps toward for doctors. Paperwork already was The idea is not to punish them, but fairs at Case’s School of Medicine. often isolated during lunch. Now, changing that culture and facilitat- a frustrating, time-consuming task get them help. He said as a pass/fail curriculum, she eats with people. She breathes ing a conversation. that took providers away from pa- The committee, which gets refer- fewer lectures and small-group, deeply a lot at work. Keeping in touch with your emo- tients. Electronic health record re- rals from colleagues, supervisors or team-based learning helps promote “There was nothing that was really tions but managing them in a way quirements from the Centers for providers themselves, provides ad- collaboration over competition, earth-shattering,” she said. “But when that lets you remain effective is a dif- Medicare and Medicaid Services vice, support or treatment referrals. which decreases stress. From the be- you take the hour once a week with a ficult, but critical balance to main- added to that. Bob Smith is the director of ginning, he wants students to un- group of people, it’s just better.” tain, said Dr. Alfred Connors, chief Other CMS programs have MetroHealth’s medical staff assis- derstand that medicine is a team MetroHealth offers Schwartz quality officer at MetroHealth. He brought more scrutiny and added tance program, which offers a free, sport. When physicians work togeth- Rounds, a panel of providers and recalled a time a medical student got pressure for physicians to keep costs confidential, on-site outlet where er, they have more support, give bet- support staff that presents and embarrassed when he saw her crying down. And doctors are asked to see overwhelmed physicians can feel ter care and are less likely to experi- opens up a discussion to encourage after a family made a difficult deci- more patients in less time. Doctors safe addressing their stress. Smith ence burnout, Ricanati said. the room to discuss the emotions sion to not take aggressive actions to who see more patients per week re- said when the program began three The school also works to identify they deal with on various cases. The revive their father if he died. port higher levels of burnout, ac- years ago there were significantly stressed or overworked students and tool was developed by the Schwartz “I said, ‘Don’t be ashamed that you get them treatment, like university Center for Compassionate Health- get emotional. This is very difficult,’ ” health services. Ricanati oversees care in Boston. he said. “ ‘The day you should worry one of the school’s academic soci- The first at MetroHealth last fall is when it doesn’t bother you.’ ” eties, which puts students into small drew 300 people. Since then, they’ve communities to foster close rela- averaged more than 225 at the ‘You are not weak’ tionships, which can offer support monthly program. Dedicated and help identify students who may McDonald, the trauma surgeon, Burnout can have clear implica- be struggling. presented at one of the panels that tions for a provider suffering, includ- And in an effort to prevent getting discussed the day the victims of the ing depression, anxiety and sub- to that point, the school brings out 2012 shooting at Chardon High stance abuse. There have also been therapy dogs before exams, offers School came into MetroHealth. a number of studies talking about yoga classes and encourages stu- Years later, it still struck deep and the impact of burnout on medical To Helping Your Company Thrive dents to get together for social strong emotions among presenters error rates, quality care, safety and events. Some may sound silly, Rica- and the hundreds gathered. Mc- patient satisfaction, Boissy said. nati said, but they are a small but Donald spoke about a case few The implications could reach fur- important piece of preparing gradu- heard of that day. While her col- ther unless the industry tackles At Ciuni & Panichi, Inc. ates to be flexible in a time of leagues worked to save the high burnout. If stress isn’t addressed tremendous change for the health school victims, she dealt with many and managed, many worry that doc- we have a professional care industry. other traumas, including deaths — tors will walk away from a profession team dedicated to in particular a 12-year-old boy who already facing a shortage. was shot. Despite immediate efforts By 2025, the nation will face a serving the construction Managing stress to save the child, he died. shortage of between 46,000 and At UH, the eight-week SMART Since then, she has struggled with 90,000 physicians, according to a industry. We’ll help you program is a “safe, confidential, the conversation around that day. 2015 study conducted for the Asso- non-judgmental, supportive” envi- Everyone — the media, the public, ciation of American Medical Col- achieve your business ronment, where providers learn very hospital administration — wanted leges. The TINYpulse study found practical skills — nothing they to talk about the Chardon victims that health care employees who re- goals. haven’t heard of, Adan said — to and offer support for the emotional sponded are more likely than those build their resilience. toll of that case, but no one asked in other industries to leave their job She teaches skills like mindfulness, her about the tragedy of the 12-year- for a 10% raise. positivity, gratitude and breathing old from Cleveland. “That was up- And when physicians leave, that exercises “to emphasize that it’s OK setting to me,” McDonald said. means fewer people doing more to take care of yourself and to take a “Every life should be valued.” work, increasing stress and exacer- few minutes to make yourself part of She doesn’t want attention for bating the problem. your priorities,” she said. every case. It can become a distrac- When McDonald presented to her Patricia McMullen, nursing su- tion. And she understands, to an ex- MetroHealth colleagues about the pervisor at UH Portage Medical tent, why some make news and oth- 12-year-old child who died, she Center, enrolled in the program rec- ers don’t. But she grieves for all lives, learned of another provider who ognizing that it could help her man- she said, and had a hard time recon- struggled with the same conflict. age stress in and out of work. The ciling the attention and discussion She felt better after having the 216.831.7171 small class afforded her the oppor- around one over another. This pan- chance to talk about these shared tunity to talk about the stress she el gave her a chance to discuss and experiences. Seeing another physi- cp-advisors.com sees as the afternoon shift supervi- deal with it. cian or surgeon dealing with the sor for the whole hospital’s nursing For about a decade, the Cleveland same emotions, McDonald said, staff. She’s often stepping in for Clinic has offered emotional support “You realize again: You are not staffing shortages, helping families through Code Lavender, a service that alone. You are not ‘weak.’ ” 20160411-NEWS--27-NAT-CCI-CL_-- 4/8/2016 2:05 PM Page 1
CRAIN’S CLEVELAND BUSINESS z APRIL 11 - 17. 2016 z PAGE 27 COMMERCIAL CONTRACTORS The List Ranked by 2015 Revenue
LOCAL FTE EMPLOYEES COMPANY REVENUE NEW LOCAL # OF LOCAL NEW CORPORATE # OF CORPORATE AS OF 4/1/2016 THIS ADDRESS 2015 CONTRACTS PROJECTS CONTRACTS PROJECTS LOCAL YEAR YEAR PHONE/WEBSITE (MILLIONS) 2015 (MILLIONS) STARTED 2015 2015 (MILLIONS) STARTED 2015 CORPORATE FOUNDED TOP LOCAL EXECUTIVE
Turner Construction Co. $348.5 $339.6 40 $9,961.0 1,500 163 1902 Jason Jones 1 1422 Euclid Ave., Suite 1400, Cleveland 44115 5,300 vice president, (216) 522-1180/www.turnerconstruction.com/cleveland general manager
Cleveland Construction Inc. $300.7 $25.1 4 $225.4 33 145 1980 Jon D. Small 2 8620 Tyler Blvd., Mentor 44060 895 president (440) 255-8000/www.clevelandconstruction.com
Gilbane Building Co. $283.7 $288.1 19 $4,882.5 193 62 1873 Scott Orr 3 950 Main Ave., Suite 1410, Cleveland 44113 2,645 vice president (216) 535-3000/www.gilbaneco.com
Donley's Inc. $268.0 $283.0 20 $392.0 39 262 1941 Malcolm M. Donley 4 5430 Warner Road, Cleveland 44125 506 president, CEO (216) 524-6800/www.donleyinc.com
The Ruhlin Co. $175.5 $112.6 32 $177.1 49 315 1915 James L. Ruhlin 5 6931 Ridge Road, Sharon Center 44274 225 president, CEO (330) 239-2800/www.ruhlin.com
The Austin Co. $163.4 $4.6 16 $203.9 80 80 1878 Michael G. Pierce 6 6095 Parkland Blvd., Cleveland 44124 200 president (440) 544-2600/www.theaustin.com
Fortney & Weygandt Inc. $89.1 $6.6 16 $85.4 79 106 1978 Greg Freeh 7 31269 Bradley Road, North Olmsted 44070 106 president (440) 716-4000/www.fortneyweygandt.com
Kokosing Inc. $86.5 $170.1 23 $825.1 203 251 1951 Brett Burgett 8 13700 McCracken Road, Cleveland 44125 2,314 owner (216) 587-4900/www.kokosing.biz
Shook Construction Co. $53.5 $13.1 8 $98.2 46 48 1926 Chris Halapy 9 10245 Brecksville Road, Brecksville 44141 257 executive vice president (440) 838-5400/www.shookconstruction.com
John G. Johnson Construction Co. $50.0 $18.0 20 $18.0 20 23 1943 Marty Weber, president, 10 1284 Riverbed St., Cleveland 44113 23 owner; Mike Weber, vice (216) 938-5050/www.johngjohnson.com president, owner
Infinity Construction Co. $43.5 $39.5 46 $39.5 46 55 1997 Charles A. Izzo 11 18440 Cranwood Pkwy., Warrensville Heights 44128 55 president (216) 663-3777/www.infinityconstruction.com
Drake Construction Co. $33.0 $12.0 55 $19.0 62 32 1954 Steve Joseph Ciuni 12 1545 E. 18th St., Cleveland 44114 46 president (216) 664-6500/www.drakeconstructionco.com
Continental Building Systems $28.2 $28.8 12 $327.6 54 14 1984 Rick Adante 13 23240 Chagrin Blvd., Suite 400, Beachwood 44122 141 project executive (216) 454-2500/www.continental-buildingsystems.com
RESEARCHED BY DEBORAH W. HILLYER
Source: 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. SPARKBASE SKY CONTINUED FROM PAGE 1 both internet retailers and physical CONTINUED FROM PAGE 5 still owed $936,000; a county repre- stores, but it also could be used by The health insurer’s leases on all sentative didn’t respond to ques- any organization that wanted to re- of its area properties expire at about tions in time for this story’s deadline. ward its employees or customers for the same time in 2020, which Jared With the help of all that funding, any reason. Chaney, Medical Mutual executive SparkBase grew from eight employ- It also was easier to use than vice president, said puts it in a “once ees in November 2010 to 40 in Janu- SparkBase’s old system, which in a generation” position to plan its ary 2013. But that number had fallen forced the company to spend a lot physical operations. to 20 by May 2015, when the board time providing customer support. “We may decide combining all four hired Haynes to replace founder SparkBase managed to attract operations into one building makes Doug Hardman. some new customers, but its ability sense,” Chaney said. “It may make So what happened? For one, over to invest in growth was limited: sense to have two. I’m positive we will the years, revenue from the compa- When SparkBase sold its core busi- not have four buildings. We’ve got all Where local business ny’s core business — which involved ness, it received some cash up front, the options available to us.” working through third party compa- but additional milestone payments Asked if the chance to change the nies to sell gift and loyalty card pro- arrived more slowly than expected, company’s culture is a factor, comes to grow grams to small retailers — flattened Haynes said. Chaney said, “It’s exciting. We’re in out, Haynes said. Attempts to go after “We never really got enough oper- a 116-year-old building. It certainly larger clients didn’t pan out either. ating cash to grow the company,” he wasn’t built for how we use it today.” We’re behind local business 100% with lending solutions like: SparkBase also spent a few years said. The changing nature of office use developing and marketing a mobile Even though SparkBase was in “a by companies also may come into • Working Capital Lines of Credit app that consumers could use to re- fragile position” before Haynes ar- play. Bob Redmond, the Ohio broker • C & I Loans deem coupons and other rewards. rived, its employees remained “un- for Mohr Partners, said offices have • Equipment Guidance Lines believably committed” to turning been growing smaller since the early But in January 2014, Hardman said • Commercial Real Estate Loans that the company had backed off on the business around, he said. That’s 2000s thanks to technology, the pop- one reason why he decided to serve ularity of open offices and the abili- what had been an aggressive plan to Rates as low as 200 basis points above the Treasury! market the Paycloud app. The com- as CEO. ty to put more workers into less pany realized it was going to be hard “I thought it was worth the effort space as a way to cope with rising We help local business because local business helps the to drive widespread adoption, Hard- because the team was so committed building costs. man said at the time. to it, despite the odds,” he said. “Companies look at how their of- community! Whether you’re just starting or taking your So what will happen to those em- fices allow them to compete for the business to the next level, trust Geauga Savings. ployees? Many of SparkBase’s in- best and the brightest,” Redmond Cash flow problems vestors “are able to refer them to our said, noting that was a factor in the Just before Haynes was hired, other portfolio companies or other movement of the EY accounting firm SparkBase had struck a deal to sell its high-growth companies in the re- into the namesake Ernst & Young core line of business to another com- gion,” Haynes said. Building. He said there is a striking 440-564-9441 Ext: 173 pany so it could focus on marketing “They were all entrepreneurial so contrast in how Sherwin-Williams a new version of its software. given the shortage of technology tal- presents itself with the contempo- Haynes said he saw potential in ent in the region, most are in high rary design of its research center in the new software: It could be used by demand,” he said. the Flats and its art deco HQ. 20160411-NEWS--28-NAT-CCI-CL_-- 4/8/2016 11:00 AM Page 1