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When you lease a full service office from The Renaissance Executive Suites, you save big on PUBLISHER unecessary space, staffing & equipment. Lyle E. Brennan We provide professional receptionist services, complete facilities , and a conference room. ASSOCIATE PUBLISHER - EDITOR Individual offices, or multi-office suites available on short or long-term leases. Connie Brennan ASSOCIATE PUBLISHER- NORTHERN NEVADA Eklof & Associates Call today and begin your Big Business Image.· ASSOCIATE EDITOR - ART DIRECTOR Barbara L Moore Renaissance Executive Suites • 702-798-4088 SALES MANAGER justin Halliday SENIOR ACCOUNT EXECUTIVE 2255-A Renaissance Dr. Chuck Dandy Las Vegas, NV 89119 ACCOUNT EXECUTIVE Kristen jaeger CIRCUIATIONIDISTRlBUTION jean Kopp CONTRIBUTING EDITORS Frankie Sue Del Papa 1 Kathleen Foley 1 David Hofstede joe Mullich I R. Keith Schwer 1 Lisa Weiss-McQuerry CORPOR4.TE OFFICE 2127 Paradise Road • Las Vegas, NV 89104 (702) 735-7003 NORTHERN NEVADA SALES REPRESENTATIVE Eklof & Associates 401 Coun St., n · Reno, NV 89501 • (702) 323-8013

The Nevada Business Journal is listed in Standard Rates & Data. #20A-Business-Metro. State & Regional. NBJ has applied for membership in BPA International. Advenisers should contact Justin Halliday at (702) 735-7003 in southern Nevada. or Eklof & Associates at (702) 323-8013 in nonhem Nevada, or write to: The Nevada Business Journal. 2127 Paradise Rd., Las Vegas, NV 89104. Demographic information available upon request. Month-to-month circulation may vary. The Nevada Business Journal corporate offices are located at 2127 Paradise Rd., Las Vegas, Nevada 89104. NBJ is published monthly, bulk postage paid. Subscrip­ tion rate is $36.00 per year. Special order single-copy price is $3.50. All contents 1995 copyright, and reproduction of material appearing in NBJ is prohibited unless so au­ thorized by the publisher of NBJ. CHANGE OF ADDRESS: Please send previous ad­ dress or mailing label & new address. Allow six weeks. EDITORIAL SUBMISSIONS: Address all submis­ sions to the attention of Connie Brennan. Unsolicited manuscripts must be accompanied by a self-addressed stamped envelope. NBJ assumes no responsibility for unsolicited materials. DISCLAIMER: Editorial views expressed in this magazine are not necessarily those of the publisher. Up to the minute Stock Reports Local News National News World News Weather Business Sports Traffic 24 hours a day

Nl News Radio \/\/HERE NE\NS COMES FIRST LAS VEGAS • NEVADA july 1995 IC 0 NTENT S Volume 10- No. 6

Features 6 INVESTMENT STRATEGIES FOR 1995 by David Hofstede Tips from the experts on riding the investment roller coaster of the '90s.

11 FINE ART AS AN INVESTMENT by Kathleen Foley Few have the ability to recognize a masterpiece before it is one. Instead, successful art collectors share this simple advice: "Buy art you love."

13 THE CORPORATE TRAVEL AGENCY by Usa Weiss-McQuerry Specializing in serving business travelers, corporate travel agencies plan page II business trips right down to the last detail ... at no extra cost.

Departments 17 PROFILES IN SUCCESS The Money Store: SBA loan specialists.

18 SPEAKING FOR NEVADA by Attorney General Frankie Sue Del Papa Targeting scams ... and safeguarding your business against liability lawsuits.

19 IN BUSINESS by Frankie Sue Del Papa How business owners can protect against computer crime.

21 TAX TIPS Investing in your child's name.

23 PEOPLE ON THE MOVE Frankie Sue Del Papa page IB 24 NEVADA BRIEFS: BajA becomes state's largest mortgage lender • Money magazine names US. Bank best in Nevada • SBA study ranks Sierra Bank as most "small business friendly" • Lender consortium provides financing for affordable rental units • BajA reports more than $I50 million in I994 community lending • Cellular One of Las Vegas becomes AT&T Wireless Services • AmBank honored again by VERIBANC • Sierra Health Services announces acquisition

28 COFFEE BREAK by joe Mullich Some people get so sick of work, they just call in sick.

30 BUSINESS INDICATORS by R. Keith Schwer Dan Cheever Although the national economy may be in for a few bumps and bruises on its page 23 way to a soft landing, it still appears to be on course. BY DAVID HoFSTEDE

ACHIEVI G A DIVERSIFIED, ill Martin, president of Pio­ people to get out of mutual funds and neer Citizen's Bank, offers back into COs and Treasuries. Now the this wrap-up of recent events rates may soften a little, and who knows BALANCED INVESTMENT PORT- in the investment markets: what might happen next." B "During the mini-cycle we Welcome to the roller coaster ride saw over the past eight months, people known as investing in the 1990s, in which FOLIO I AN UNCERTAIN AND moved their money out of banks, Trea­ banks and brokers lay out their buffet of sury bills and COs, because the rates were investment options for customers whose too low. They went into mutual funds, choices are often dictated by uncertainty FLUCTUATI G MARKET CAN BE expecting nice big yields, and it didn't and impatience. happen because the market was very flat. The advice of the experts? Don't panic. DAUNTING. HERE ARE SOME They grew disenchanted with funds, so "We've gone through tremendous the federal government, in an effort to swings in a very short time, and that s head off inflation, raised interest rates; something we're going to have to gel TIPS FROM THE EXPERTS. all of a sudden there was incentive for used to," Martin said. "If your objective

6 Nevada Business journal • July 1995 is retirement in 15 or 20 years, then you People who reacted to them incorrectly return - even though it is uninsured by must Jearn to rise and fall with these didn't make money a year later." the FDIC- we'd rather he or she did so swings, and not worry about it. If you Dollar cost-averaging works equally here than with a broker across the street." have any other investment objective, stay well in the stock market, according to To stockbrokers, expertise makes the short and stay diversified." David Seidner of Seidner Securities, difference, and they're willing to prove Frank Aguilar, regional vice-president "When the market goes down, that same it. Kevin Palmer and David Seidner were for Bank of America-Nevada, stresses monthly amount of money buys more introduced to a hypothetical investor with there isn't any one investment formula shares, so you're diversifying both where $25,000, and asked to recommend a few which is right for everyone. "We might and when you invest. It takes the risk out choice stocks. One year from now, we' ll advise our customers to get into a mass of timing the market." As for the specu­ check the results. allocation plan, with some fixed-income lation that the market is fantastically over­ The editors of the Nevada Business . products and some growth-oriented prod­ priced by most classic measurements, Journal stress, however, that the views ' ucts, as well. We might also recommend Seidner doesn't buy it. "The old yard­ and comments presented in this article tax-deferred or tax-free investments - it sticks don't work anymore. There's never do not represent recommendations of this depends upon the individual's goals, a bad time for a good investment." magazine. In addition, all financial con­ abilities and tax bracket. As investors become more skittish, the sultants urge investors to seek personal­ "Mutual funds are not as popular now competition for their investment dollar ized advj ce from qualified professionals as they were in 1992," continued Aguilar, has escalated. Bank of America offers a before making commitments. "but they still have a place in everyone's full range of investment products, includ­ portfolio. We've seen our customers pull­ ing the stock market, through an in-house ing back, and now leaning toward Trea­ discount broker service. "We cannot give suries, corporate bonds and other, more advice, but we can make a customer's DAVID SEIDNER conservative, fixed-income investments, stock transaction through brokers in our Seidner Securities which now comprise 80 percent of our branches, or· through an 800-number," sales," he said. Aguilar said. "I wouldn't go into more than fi ve dif­ Another popular option, according to "The playing field between banks and ferent items with that $25,000, because Aguilar, is dollar cost-averaging, in which brokers for the investment dollar is not the market's going to be choppy," Seidner a percentage of funds is systematically as level as it needs to be," observed Dan believes. "Interest should remain flat to invested every month into the appropri­ Cheever, president of PriMerit Bank. "A lower, the economy will trend sideways ate objective. broker can offer CDs, but a bank can't and so will the market, but prepare for a The stock market has been equally ca­ directly offer securities or mutual funds, rally at the end of the year, which should pricious. Is Wall Street now eyeing the without an affiliate or third party." With last through the first quarter of 1996." magic 5,000-point mark on the Dow one-stop shopping the wave of the fu­ Jones Industrial average, or will the next ture, PriMeri.t took the \)lunge three years OcciDENTAL PETROLEUM milestone be the 4,000 mark - on the ago. "As interest rates declined and I advise a short position of 100 shares, as way down during a correction? "Decem­ people on fixed incomes began moving I'm looking for it to drop 10 percent to ber of 1994 was the time to get in," said their money into mutual funds, or the 15 percent. It's easier for markets to go Kevin Palmer, vice-president and finan­ stock market, we've added a third party down than to go up, so this is a good cial consultant at Merrill Lynch, "but dealer- Great Northern Annuities. "If a hedge in my portfolio. The stock is pres­ stocks have always out-performed all customer wishes to invest in a fund or an ently near its historical high, and if there's other investments over time, and they annuity, we refer them to the Great orth­ a slowdown in the economy, it could are still the place to be. At this point, you ern representatives in our branches, all trend lower. I am usually a bullish per­ just have to be careful what you choose. of whom are licensed securities brokers. son, but this is an insurance pick that "As for the big 500-point sell-offs that "It's a fine li ne we're forced to walk; will make money on the downside. occurred in the past," Palmer explains, Cheever admits. "Our purpose is not to "you look at them years later and they're make recommendations. But if a cus­ RUBBERMAID just a small blip on the chart, though at tomer is looking for an investmen rhat A well-managed company that is expand­ the time they seemed like a vast cavern. has the potential to bring a hi~ er rare of ing internationally. The stock has already

july 1995 • Nevada Busi ness journal 7 had a big drop recently, but interest rates cent in 1995, compared to 20 percent ucts. Also manufactures chemicals, phar­ are lower and more people are buying last year. That being the case, look to maceuticals and perfumes. 1994 saw ma­ houses, which should prompt an increase buy recently ignored markets like: small jor asset write-downs and restructuring in all the economic activity that is re­ company, capital goods producers, changes designed to rectify the aggres­ lated to home sales, and that would cer­ outscoring specialists, international re­ sive expansion strategy of the early '90s tainly include all the household items sources in emerging markets and REITS. carried out by its previous chairman. manufactured by Rubbermaid. I recom­ Good signs to look for: excess corporate Cost-cutting is starting to be felt and ac­ mend purchasing 100 shares. cash, company stock repurchase an­ counted for improvement in underlying nouncements and a strengthening dollar net to $595 from $530 in 1993. Buy long­ TuNE (formerly DMX, Inc.) that could bring foreign investments into term on rising output, stronger chem­ A low-priced stock that came to my at­ the U.S. dollar-linked market. icals, benefits from provisions and . tention when I found out that Steve Wynn "However, with both the bond and rationalization as well as prospect of ' is on the board of directors, and owns stock markets at record levels and with rising oil prices. about 15 percent of the company. The the aforementioned plethora of seemingly price per share has fluctuated between contradictory economic information, in­ FIRST FINANCIAL MANAGEMENT 2 1/2 and 2 3/4, but right now you can buy vesting for the second half of the year (FFM)- $1 ,000 it for 2 1/4. TUNE's digital Music Express becomes extremely difficult, especially A leadq in merchant credit card pni­ service is the music business equivalent in light of the extensive profits from the cessing services (NaBANCO), check­ of HBO, and though the company is not beginning of the year which could stand guarantee services (TeleCheck), debt col­ profitable yet, it could be by the end of to be taken in part." lection and receivables collection, the year. Steve Wynn is not going to be a consumer money transfer services (West­ loser on this one, and if I don't sell until CMA MoNEY MARKET/CAsH em Union), data imaging, micrograph­ he does, I don't see how I can go wrong. $12,000 ics, healthcare claims-processing ser­ It reminds me of when I bought stock in vices, and integrated management and a small company called National Enter­ ONE-YEAR U.S. GovERNMENT BoND cost-containment services. Generally tainment, which later became Block­ $5,000 speaking, the credit card processing ser­ buster. Invest the balance of the $25 ,000 vices market was up 24 percent in 1994, in TUNE, which could be selling in the BowATER (BOW) - $1,000 due to widening acceptance in locations teens in the next two years. Largest and lowest-cost producer of such as supermarkets. Consider Western newsprint in the United States, and one Union acquisition a favorable strategic of the most efficient in the world. Also, a move. This segment, which accounts for major producer of coated ground-wood 20 percent of revenue, is expanding rap­ KEVIN PALMER and computer forms with plans to grow idly and is highly additive to earnings. Merrill Lynch further in coated paper. Export sales ac­ count for 20 percent of revenues. News­ LUBRIZOL CORP. (LZ)- $1,000 "The outlook for the economy is a good print markets are undergoing fundamen­ World's largest supplier of specialty one, though it may be better described as tal changes in view of prospects for lower chemical additives for vehicle lubricat­ the Goldilocks scenario; the growth rate consumption growth and publisher's in­ ing oil. Foreign sources contribute 58 in the moneys ahead could be just right, creasing demand for recycled content. percent of sales. New product cycles for not too fast as to cause runaway inflation Minimal capacity growth expected over passenger motor oil, diesel engine oil and and not too slow as to cause a reces­ next several years, coupled with modest automatic transmission fluid should lead sion." Palmer predicts, "Look for a mixed real GDP growth, leads to very favor­ to stronger volume and improved mar­ bag of seemingly contradictory economic able pricing outlook of newsprint. gins in 1994-1995. Earnings should also statistics, some showing strength and benefit from a flattening in product test­ some showing weakness, to be released ELF AQUITAINE (ELF)- $1 ,000 ing costs and lower operating costs fol­ in the months ahead. France-based integrated oil/natural gas lowing a March, 1993 restructuring "Anticipate corporate earnings among producer is third largest in Europe, where change. The downside risk is limited by S&P 500 companies to rise about 10 per- it is a leading marketer of refined prod- an active stock buyback program.

8 Nevada Business journal • july 199 ; "LAST MONTH, I WALKED INTO U.S. BANK AND SUDDENLY EVERYTHING CAME UP ROSES."

A nd no, we're not talking about flowers. We're talking business. Your business. How to keep it running and help it grow. Sound good? Then you should talk to U.S. Bank. Because we make it easy to get a small business loan. You don't need a H arvard degree, winning lottery numbers, or a ton of credit, either. So whether you 're in the business of helping people plant, package, plaster, or anything else, stop by your local U.S. Bank branch and apply for a small business loan today. Then sit back and watch your business bloom.

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BY KATHLEEN FOLEY

urchasing fine art can be com­ ers and directors contacted for our sur­ today may not be popular enough to com­ pared to choosing a marriage vey, emphasized the aesthetic and emo­ mand a big price tomorrow. So it's im­ partner: you love it, you know tional reasons for purchasing art, rather portant, first and foremost, to buy some­ something about its background, and you than advising readers to invest in fine art thing that pleases you." want to live with it. If, along the way, as a hedge against inflation or as a retire­ Crockett offers the following sugges­ your artwork appreciates or your spouse ment nest egg. Considering the tions to those interested in investing in inherits a fortune, then so much the bet­ unpredictability of the fine art market, fine art: fall in love with the piece, buy ter. If, on the other hand, you decide to these "soft" reasons may outweigh cold, from a reputable dealer, buy the best you quickly divest yourself of your artwork hard financial calculations in the end. As can afford, and learn the history of the or your marriage partner, you may not in real estate or the stock market, there piece and something about the artist. A always come out a winner financially. A are fluctuations in the art market, which gallery can often help trace the owners survey of Las Vegas gallery owners in­ may sometimes be linked to economic of an original piece to verify its authen­ dicates that, while they are optimistic trends like inflation, but may as easily be ticity. Crockett Gallery, which sells to about the art market in general, they re­ influenced by what one gallery owner individuals as well as corporate clients, alize that fine art is not a liquid asset, labeled "fashion or whim." For example, features mostly original works in a vari­ and shouldn't be depended upon to pro­ it is hard to imagine a financial planner ety of media and styles. In addition to vide a quick and easy return on one's in 1965 having the foresight to advise glass works, sculptures, limited edition investment dollars. his client to purchase a silkscreen de­ prints, oils and watercolors, they offer The Securities and Exchange Commis­ Qicting, giant CamQbell 's soup cans, and custom framing, services. sion forbids galleries from advertising or yet Andy Warhol's works became enor­ Russell Manning, director of Centaur selling art as an investment, since this mously popular and valuable. Sculpture Galleries, admits that "no one would require them to register as invest­ "Art has cycles," warns Caty Crockett, knows what will happen to the art mar­ ment brokers. Therefore, the gallery own- owner of Crockett Gallery. "What's hot ket in any five-year period. However,

July 1995 • Nevada Business journal II ~im Art ltJ ~tn Jnve.st~nent

living with a piece of artwork you love is preciates, that's an added bonus. If it sufficient, the remainder represents the a lot more fun than hanging stock certifi­ doesn't, you still love it." Her gallery proverbial "starving artists" of TV com­ cates on the wall." As an indication of offers limited edition prints on a wide mercial fame. Thompson reports that the gallery's faith in the market, custom­ range of subject matter, as well as fine Hawaii-based artist, Christian Riese ers are offered a five-year exchange privi­ crafts and Disney animation art. The mar­ Lassen, is one of only about 2 percent of lege whereby collectors may use the full ket for limited edition prints and sculp­ artists whose work has been shown to purchase-price value of a piece to trade tures is easier to track than the market in appreciate on a consistent basis. He is for other works in the gallery. original paintings and sculptures. Most quick to point out, though, his company In addition to bronze and acrylic sculp­ galleries offering limited editions sub­ cannot guarantee the investment value tures, the Centaur Galleries offer bas re­ scribe to publications that show how of any artwork. Lassen does, on occa­ liefs and "art-to-wear"-jewelry designed prints have appreciated historically, and sion, offer consignment sales for owners by artists to be displayed on the body or can provide the customer with a back­ wishing to sell a work of art. Lassen clothing like mini-sculptures. Founded ground of how a particular artist's works International operates seven galleries na­ 15 years ago as Minotaur Galleries, the have performed in the past. However, tionwide, including one at the Forum Centaur Sculpture Galleries is now lo­ reminds Mrochek, "There are no finan­ Shops in Las Vegas. cated in the Fashion Show Mall on the cial guarantees. Things go up and then "Buy art you love and you will always Las Vegas Strip. go down. It's not a science." be happy," Thompson states. "Nobody "Buy the art for the artwork itself," According to Dale Thompson, general regrets the art he or she has purchased; , advises Denise Mrochek, co-owner and manager of Lassen International in Las people have regrets for the art they didn't. director of Moonstruck Gallery. "If it ap- Vegas, only 14 percent of artists are self- buy when they had the chance." • So much interest. No time at all.

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12 Nevada Business journal • July 1995

According to Julie Celia, corporate travel manager of Las Vegas' Profes­ GALLERY sional Travel Services, there is no catch. FINE ART I FRAMING "We're affiliated with the Carlson Wa­ gonlit Network, so that allows us to ne­ The Plazas gotiate special hotel rates, especially at 2800 West Sahara Suit C I Las Vegas, NV 891 02 major chains," says Celia. "We have so T elephone 702 253 6336 many agencies that make upthe Carlson network, that we're able to get better rates than someone just calling up a ho- • tel to book reservations." Celia explains that when a business or corporation first decides t9 start using a corporate travel agency, such as Profes­ sional Travel Services, the agency will create a ~complete customer travel-pref: erence profile. This profile details each traveler's preferences on everything from air carrier and car rental agency, down to special dietary needs and seating prefer­ Digital Music Express® ences, "When they're ready to book a trip we just pull up their preference pro­ Think of It as a Menu · file which contains all of the necessary with up to 76 Ways to Improve information, including frequent flier num­ bers and special requests," says Celia. Your Business. Celia maintains that agencies like Pro­ fessional Travel Services can take care of not only finding the least expensive way to travel from point A to point B, but also handle everything from ticket • 500,000 original titles delivery to arrangements for car rentals • Up to 76 formats of CD quality music and hotel accommodations, all for the same price. "We also have 24-hour.emer­ • No commercials, no DJ talk gency service, toll-free numbers, and an • Enhances your atmosphere option for clients to be met at the gate of their destination, just to comfirm they • Customers spend more, return often have everything they need," adds Celia. • One touch program control In addition to the traveling basics, Pro­ • ASCAP /BMI fees paid fessional Travel Services also takes care of making arrangements for clients who • Background, foreground, on-hold music need business meeting facilities at loca­ Call Today for a Demonstration. tions out-of-state, as well as out of the country. "We can cover seating arrange­ 384-8084 ~ ments, audio-visual aids, refreshments ...

DIGITAl IIUSI{ EIPUSS we can put together the itinerary that Prime Cable of Las Vegas BUSINESS calls for a lunch break, snack break, what- Commercial Development Someday, E"ry Business W'ill Sound This Good. U.S. Senator Harry Reid ••• on a balanced budget:

"It would be the easiest vote in the world for me to vote for the amendment. Everyone in Nevada is in favor of it." 1 ...... Senator Reid voted against the balanced budget

So, Senator ... Who do you represent?

PAID FOR BY NEVADANS FOR A BALANCED BUDGET. 1. Las Vegas Review-Journal; Thursday, March 2, 1995 CO~I>O-IHH.C T~-'lV.Cl -'lG.CHCI.C~

ever the client needs," says Celia. In fact, if a client is traveling out of the United States, Celia says she'll find out every­ thing about the destination country; in­ cluding requirements for passports, vi­ sas and immunizations. "We do all the research so a client will reach his or her destination fully prepared and informed. Everything is covered." And just so you can see what you're saving by going through a corporate travel agency, Professional Travel Ser­ vices also provides clients-with monthly itemized business and savings reports,, so deta i l ~d records can be kept. Celia. says she can also help her clients who want to provide travel incentive programs for their employees. "If sales associates, for example, meet certain goals, they are rewarded with different types of travel benefits, which we can provide." According to Celia, getting involved is quite simple. "We require no contract. When a business first contacts us, we discuss our benefits and services. We also give the company a corporate packet, which provides details about everything we offer." Explains Celia, "We provide the client with preference profile sheets to complete, put the information into the system, and then they're all ready to make reservations. That's it .. . there's no fee and no contract." Celia says many people are under the impression that it costs more to use a corporate travel agency, when in fac 1.. because of the buying power of their large numbers, corporate agencies generally can provide incentives of a higher qual­ ity for the same price. "Because so many benefits are offered, many people believe corporate travel agencies charge a num­ ber of fees for the services they pro­ vide," says Celia. "We make our money through the hotels, the airlines and the car companies - not the client." •

16 Nevada Business journal • July 1995 PROFI LES IN SUCCESS

THE MONEY STORE: SBA loan specialists

by Kathleen Foley

THE MONEY STORE, one of the cia! Mortgage, Inc. provide funding to nation's leading originators of home eq­ small businesses in 33 states and the Dis­ uity and Small Business Administration The Money Store's combined trict of Columbia. While many banks (SBA) guaranteed loans, has made sig­ spurn SBA loans because of the volumi­ nificant inroads into the Nevada lending offices in Reno and Las Vegas nous paperwork, The Money Store has scene, and now has two branches in Las computerized the process and now offers Vegas. One branch, headed by Chris loans for owner-user commercial real Vargas, specializes in first and second represent the third largest estate acquisition and improvements, mortgages. Russ Torge heads the other equipment and working capital. office, which specializes in SBA loans SBA lender in the state of Because of the low vacancy rate for to small businesses. commercial real estate in Southern Ne­ Alan Turtletaub founded The Money Nevada, with $3.7 million in vada, Torge's office usually lends money Store in 1967 to focus on the second­ for building construction rather than for mortgage business in his home state of moving into an existing location. They New Jersey. Now, under the direction of loans during 1994. can then convert the loan to a takeout the founder's son, Marc Turtletaub, and over a 20- to 25-year term. Most of these headquartered in Sacramento, California, loans require the borrower to occupy at The Money Store has a network of 157 According to Vargas, the local office least 50 percent of the building, putting offices in 40 states, and last year funded offers 30-year fixed-rate first mortgages up 10 to 20 percent of the cost and fi­ a total of over $2.8 billion in loan vol­ at rates "very comparable to banks." It nancing the remainder. The Money Store ume. It offers home loans, government­ also offers second mortgages for home may loan a physician money to buy a guaranteed small business loans and gov­ improvement or bill consolidation; cus­ professional building, says Torge, or loan ernment-guaranteed student loans. tomers may finance up to 100 percent of a manufacturer money to put up an in­ The Money Store provides fixed-rate their equity. Most loans originated in Las dustrial building. He also recommends first and second mortgages as well as Vegas run from 10 to 15 years and aver­ their "low-doc" program, specifically de­ FHA Title 1 home improvement loans to age approximately $40,000. signed for smaller companies, with a loan homeowners in 35 states and the District "We pride ourselves on seven-day clos­ range of $20,000 to $100,000. As the of Columbia through 88 offices, includ­ ings," says Vargas, "and we have a com­ name implies, this type of loan requires ing one in Reno and one in Las Vegas. puterized 24-hour loan approval service. fewer documents than the usual SBA The company's three decades of profit­ We try to give our clients the best of loan, speeding up processing time to an ability have often been at the expense of both worlds: the personalized attention average of 21 days. banks who originally considered home­ of a local loan office as well as the ad­ The Money Store is also a significant equity lending too risky. Chris Vargas of vantages of a large centralized facility." originator of student loans. Educaid, the the Las Vegas home-equity branch, The Money Store's SBA office in Las company's student loan subsidiary, which opened in 1992, says the com­ Vegas opened in January 1994, and en­ funded $252 million of student loans in pany targets what he terms the "less­ joyed a very successful first year. Ac­ 1993, focusing largely on four-year col­ than-perfect credit borrower': cording to Russ Torge, business devel­ leges and professional schools, where the The Las Vegas office has been aided opment officer for the Las Vegas branch, default rate is lowest. Chris Vargas re­ by the parent company's aggressive na­ the combined offices in Reno and Las ports they are also branching out into car tional marketing campaign, featuring tele­ Vegas represent the third largest SBA loans, handled exclusively through auto vision commercials by Baseball Hall-of­ lender in the state, with $3.7 million in dealerships. The role of the local offices Fame inductee Jim Palmer, as well as by loans during 1994. The Money Store has in these types of loans is to act strictly as a 24-hour toll-free hotline to the central­ been the nation's top Small Business Ad­ a go-between, directing the clients to the ized loan processing department in Sac­ ministration lender- since 1983, with a centralized location for processing. Both ramento_ This strategy enabled the local $1.3 billion portfolio of small-business of these loan specialties can be accessed office to originate nearly $18 million in loans. The Money Store Investment Cor­ through a toll-free number from any­ home-equity loans during 1994. poration and The Money Store Commer- where in the country. •

July 199; • Nevada Business journal 17 SPEAKING FOR NEVADA

Targeting Scams ... And, Safeguarding Your Business Against Liability Lawsuits by Frankie Sue Del Papa problem employee, document his Nevada State Attorney General or her warnings and evaluations. Similarly, be sure to document WHO among us has not been inter­ when you have a complaint, or are rupted at suppertime by the unwelcome responding to one. Build your telephone call telling us about the· case and be thorough. fantastic prize that has been won or the 2. Don't make promises you can't great deals that have to be acted upon keep. You can be bound even by immediately? Only later we realize the casual oral agreements. call is bogus. Businesses are not 3. If you have a policy, honor it. If immune to scams either, and can be you have rules or procedures, victimized with phony invoices, follow them. dubious charitable solicitations, or 4. Educate your staff regarding questionable investment schemes. policies and procedures and the Over the past several years, the office need to follow them conscien­ of the attorney general has made a tiously. This means not only dedicated effort to inform Nevadans on upper level management, but all ' consumer issues. Firm but fair regula­ 4. The company is unwilling to send le~ els of your company's staff. • tion, tough enforcement and public you written information on the Education is an ongoing process; education are some of the ways we try offer, or give you references. it never stops and must be to protect residents. Nevada works with 5. The caller asks for your calling reinforced continuously. other states, other government entities, card number as identification for 5. Communicate- not only to senior centers, and organizations such purchases. employees, but to the people you as the local Better Business Bureau, 6. Individuals linger close by while serve. Let the public know what among others. you are making a call from a your service is: what you can do Lately, there has been a rash of public phone. and cannot do. Be innovative in illicit telemarketing activity. The most 7. Someone claims you've won a public relations. recent scams have to do with phony prize- and you haven't entered 6. Don't try to do the impossible. invoices for copy machine toner, office a contest. 7. Know your limitations- work supplies, or the like that were never 8. Someone asks for your calling within the resources you have. ordered or received. card or credit card number to 8. Don't get bogged down in details; We also have seen concerns rise qualify you for a prize. look at the big picture. relative to honor boxes and are urging 9. A telemarketer asks for your 9. Talk to your attorney before you both individuals and businesses to social security number in order have any problems. It's often too exercise caution and know who you are to purchase products, or qualify late when you are sued or dealing with. This warning also applies to receive prizes. threatened with a lawsuit. to charitable donations and investments. 10. You are required to pay a fee Any Nevada business with a question Here are some tips for spotting scams: before you receive complimentary or comment for the attorney general's Be suspicious if: goods or services. office is encouraged to call. The 1. The company has a name that is principal responsibility of the attorney intended to sound like a govern­ general's office is to provide legal ment agency or a well-known advice to state agencies and officers, company. ON another but related front, the defend any of these when sued, and 2. You must act on the offer the office of the attorney general offers prosecute in those areas within our same day. advice on avoiding liability: jurisdiction. However, we believe 3. The telemarketer acts like he or 1. Put things in writing -document consumer protection plays a vital role she has done business with you. all actions, e.g., if you have a in this process. •

18 Nevada Business journal • july 1995 by Nevada State Attorney General Frankie Sue Del Papa

How to Combat Computer Crime

A BANK ROBBER may' net $10,000 element views computer crime as a chal­ from computer to computer creating from his crime, and take the risk of lenge; the computer and the company havoc wherever they gain access. being shot; the traditional embezzler, us­ are impersonal objects. Employees or not, There are three ways businesses can ing a set of manually maintained books, they only have their own interests in safeguard against this type of computer usually siphons $20,000; but the typical mind, and they have many ways to vic­ sabotage: first, always use· virus detec­ computer criminal nets nearly $500,000, timize a business. tion software. Since new viruses appear according to government estimates. Sabotage is one of the easiest ways to regularly;'it is important to update to the The Nevada state attorney general's attack a computer system and can be ac­ latest version of the guardian software as office has joined a nationwide effort by complished by anyone; clerks, supervi­ soon as it becomes available; Second, attorneys general to issue regular con­ sors, disgruntled programmers and even never load software that has been pirated sumer alerts, and to combat fraud with a competitors. The system hardware can or copied from another source. Besides heightened awareness of the crime. The be physically sabotaged through arson, being illegal, installing illicit software is information contained in this article is extensive wate:r damage, or slashing. the most common way computers be­ based on the research of Ira A. Lipman, Just as destructive to a firm 's com­ come infected. Strict company policy known for his innovative leadership in puter system is a sophisticated program­ should be in force to prevent employees the security industry. ming ploy known as a "virus." The target from loading unauthorized software onto With the growing necessity of wide­ business often is not aware its system the corporate system. Horror stories spread use of computers in our highly has been compromised until later when abound of "innocent" computer games technical and information-driven society, the virus has been activated, and "in­ fatally infecting a multi-station network; the prevention of computer crime adds fects" the computer. Some viruses are Third, prepare for the worst. Keep a com­ to the complex security measures under­ written to include an "incubation period" plete backup of all current system soft­ taken by most businesses. However, any­ which keeps the virus dormant for a set ware and a daily updated copy of all data one with access to a computer can com­ amount of time, or until the computer files. Backup disks, tapes and cartridges mit a computer crime. With the extensive has run a certain program, or series of should be kept under lock and key in a use of modems and telephone linking in programs, a specified number of times. fireproof media safe. Wise managers also the world today, businesses are at spe­ Computer viruses are created by pro­ keep a second full set of backup disks at cial risk for becoming victimized. Busi­ grammers who write codes which modify another location. nesses certainly provide for safeguards part of the system software. When acti­ Preventing unauthorized use of a sys­ against employee theft, but should also vated, these codes will erase or corrupt a tem or network should also be consid­ be aware of the possibility of theft com­ system in varying degrees. The potential ered a part of an overall security program. mitted from a distant keyboard by an damage can be quite costly, particularly It is not uncommon for an employee to unseen user who is not an employee. in terms of system downtime and repro­ use his or her computer system for per­ The typical computer criminal is be­ gramming expenses. sonal gain- perhaps owning a small busi­ tween 18 and 30 years of age, bright and Compounding the problem, computer ness on the side and allowing the system highly motivated, well-dressed, courte­ viruses are "contagious," using software to perform personal accounting functions. ous, ambitious and hard-working. This to spread. They can be unwittingly passed Or, using the system and peripherals, such

July 199; • Nevada Business Journal 19 PETER MAX ROBERT LYN as printers and fax ma­ tronic protection, in­ chines, to create letters In-depth interviews, cluding closed-circuit NELSON and stationery, or to television, passkeys for send and receive docu­ background checks and employees and codes AND ments. Employees for computer access could use your tele­ fingerprinting should be enhance security. An MORE! phone linking for busi­ isolated location will ness contacts or to con­ considered for employ- provide better monitor­ duct personal research ing of access to the on your Internet pro­ ees who will have access center. The computer vider for which your facility should be business pays a fee. Of to secured or sensitive constructed or refur­ course there are many bished with waterproof more sophisticated information or software. and fireproof mater­ ways computers can be ials; buildings and used for criminal pur- furnishings consisting poses, such as creating of wood, wood by­ false accounts with automatic payments products or other flammable materials• or paying off the debts of friends or as­ should be avoided when possible. sociates. These actions can cause a busi­ Unfortunately, all the advanced plan­ ness fin anci al loss, as well as jeopardize ning and comprehensive security·proce­ its reputation . dures will not make a system completely • • There are a number of ways the busi­ "hack-proof." Anyone with a computer, ness community can combat technologi­ a modem and the skills can gain access RELIEVE cal crime. One of the basic and most to a designated system. Following a few widely used methods is to conduct a thor­ additional safeguards could make the dif­ ough screening of all employees and ap­ ference between being victimized or not. STRESS plicants. In-depth interviews, background Develop special programming to limit checks and fingerprinting may be con­ access from remote terminals, or from sidered for employees who will have ac­ individuals attempting to gain access Accupressure cess to secured or sensitive information from the outside. If possible, disable mo­ or software. It pays to have built-in dems or disconnect incoming telephone checks and balances within the informa­ lines from the system when the office is Healing Therapy tion systems department. For instance, closed or not staffed. Install callback no one person or group should be al­ modems which verify the user and phone Ease tension, arthritis pain, lowed unrestricted access to all computer number before granting off-site access. back and neck pain functions. Shared responsibility for pro­ Most importantly, if your business is gramming, operation and maintenance the victim of computer fraud, file charges will help ensure that one person or group immediately! Remember, this type of • • • does not end up with total authority and fraud can result in substantial financial A Academy Kenpo Karate access to all areas of the computer sys­ loss, and potentially irreparable damage. tem. Physical access can also be limited By taking these precautions, you can dis­ Self Defense ~ Fitness for greater security. courage fraud before it starts and fight Therapy For those companies that have a com­ computer crime in Nevada and through­ puter center to house the mainframe or out the United States. (702) 733-7788 server, admittance should be limited to Questions or comments can be directed 3025 E. Desert Inn Rd. Suite 7 authorized personnel only. Locks, alarms, to the Telemarketing and Consumer Las Vegas., NV 89121 guard systems, adequate lighting and few Fraud Unit of the Nevada Office of the • • windows will contribute to security. Elec- Attorney General at 1-800-992-0900 .•

20 Nevada Business journal • June 1995 Should you sock money away in Investing in your child's name your child's name or keep it in your own? There's no pat

Custodial Accounts Offer dren over age 14, there are two major answer. The Nevada Society of Tax Advantages drawbacks. First, once you put money One of the easiest ways for parents to into a custodial account, it becomes an save in a child's name is to set up a irrevocable gift, which means it is your CPAs says the best course of custodial account under the Uniform child's money forever. Legqlly, all the Gifts to Minors Act (UGMA) or, depend­ money must be turned over to the child ing on the state in which you live, the when he o~ she reaches age 18 or 21 , action depends on your family's Uniform Transfer to Minors Act depending on the law in your state. Sec­ (UTMA). Under the UGMA or UTMA, ond, you cannot dictate how the money you, or someone you designate acts as is to be spent. While you may have ear­ financial situation, objectives custodian. The custodian determines how marked the funds for your son or the money is invested and may withdraw daughter's college education, your child money for the child's direct benefit. might decide to spend the windfall on a and overall tax strategy. You can deposit gifts of cash and se­ sports car instead. curities to an UGMA or UTMA account; the more inclusive UTMA also permits Trusts Can Be More Flexible gifts of real estate and other non-cash A trust, although not a tax-deferral de­ assets. Any bank or brokerage firm can vice, is another option you may want to open a custodial account. There are no consider, particularly if you're concerned complex legal documents involved and about maintaining control of the funds no fees beyond the institution's regular you put in your child's name. Generally, service charges. a trust is more complicated and costly to While custodial accounts no longer establish and maintain than a custodial offer the tax breaks they once did, they account. Nonetheless, a trust may make still provide tax benefits. If your child is sense if you plan to transfer a substantial under age 14, the first $650 of invest­ amount of money to a child. ment income each year is tax-free and How ev er, now that they arc subject to the second $650 is taxed at the child's higher tax rates, trusts have lost much of rate (usually 15 percent). Unearned their appeal. For 1995, the rates for trusts income above $1 ,300 is taxed at the start at 15 percent for the first $1,550 in parent's highest rate. For children age 14 income, but quickly reach 39.6 percent and older, the first $650 of investment on income above $7,650. Because the income is still tax-free, but all unearned highest trust rate of 39.6 percent kicks in income above that amount is taxed at the at a relatively low level, you may actu­ child's generally lower rate. ally end up paying more taxes with a Although you may find the tax break trust than with a custodial account. appealing, particularly if you have chi!- The simplest type of trust is the

July 1995 • Nevada Business journal 21 Minor's Trust, also known as the 2503(c) In order for gifts to a Crummey Trust trust (named after a section of the Inter­ Before you decide to use a to qualify for the federal gift-tax exclu­ nal Revenue Code). As with the custo­ sion, each year the child must be given a dial account, you and your spouse cah short period, usually between 30 and 60 deposit up to $20,000 a year ($10,000 trust or make any irrevo- days, to decide whether he or she wants each) to a Minor's Trust without incur­ to withdraw the amount of the gift made ring federal gift taxes, provided the trust to the trust in that year. After the win­ gives the trustee (who must be an inde­ cable gifts to your children dow closes, no withdrawal is allowed pendent party) power to distribute the until and unless a gift is made the fol­ assets for the child's benefit. The trustee through custodial ac- lowing year. controls the assets until your child reaches Before you decide to use a trust or age 21, at which time, all assets must be make any irrevocable gifts to your chil­ distributed to the child. counts, be sure these strat- dren through custodial accounts, be sure . If you'd like more control, you may these strategies fit into your overall ' want to set up a Crummey Trust (named financial and estate plan. It is important after a court decision). Unlike custodial egies fit into your overall to enlist the assistance of a qualified pro­ accounts and the Minor's Trust, a Crum­ fessional before taking action. • mey Trust can extend beyond a child's financial and estate plan. 21st birthday, with the trust's assets Preparefl by members of the Nevad~ distributed in stages. Society of Certified Public Accountants.

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22 Nevada Business journal • July 1995 People on the Move

Richard A. Etter, chair­ Theodora McKinnon, manager of joined the bank as senior vice president man and chief executive account administration in corporate and manager of information services. officer of Bank of custody services; Thomas Powers, man­ In his new position, Borenstein will America Nevada, has ager of the Lone Mountain/Decatur oversee the computer information ser­ been appointed to the branch; Sean Quinn, manager of ATM vices at the four branches of American executive committee of services; Francine Schartz, southwest Bank of Commerce. Richard A Etter Nevada Development region administrator of corporate trust Authority (NDA), a non-profit organi­ and agency services; and Fabio Vincent, Jerilyn Clayton, chairman zation dedicated to the expansion and district business officer of southern dis­ of the board, Consoli­ diversification of Southern Nevada. The trict administration. dated Mortgage, recently NDA executive committee is comprised announced that Lana K. of 16 of Southern Nevada's most promi­ PriMerit Bank recently Wright has been pro­ nent business leaders. named Steven Anderson moted to the position of as new business banking Lana K. Wright executive vice president- The Desert Research officer. In his new post, administration for the firm. Institute has appointed Anderson will specialize Wright will be responsible for all daily Dr. Stephen Wells as in the development of administration of the company while con­ executive director of the Steven Anderson PriMerit's business lend- tinuing to oversee the financial areas of Quaternary Sciences Cen­ ing and deposit gathering efforts for the the corporation. ter. The title is equivalent area's small businesses. Dr. Stephen Wells to university dean. Richard Carlson has PriMerit Bank President been appointed vice chair­ Comstock Bank loan officer, Cheryl Dan Cheever was re­ man of the board of di­ Parino, has been named a "top producer" cently appointed to the rectors for Nevada State by the Nevada Mortgage Bankers Asso­ legislative committee for Bank. Carlson served as ciation. Parino has twice been named to the Western League of the bank's president for Comstock's President's Circle, which Savings Institutions Richard Carlson 16 years until his retire- recognizes the bank's top producers. Dan Cheever (WLSI), which was for- ment earlier this year. merly known as the California League Under Carlson's tenure, Nevada State Bank of America Ne­ of Savings Institutions. Bank grew to become the fifth largest vada announced it has WLSI concentrates on four primary ar­ commercial bank in Nevada. appointed Rod Dunnett eas of activity - advocacy, education, and Diane Ingram as se­ information and member services - in · Sierra Health Services announced the nior vice presidents. order to help member institutions com­ appointment of Michael D. Phillips as Dunnett is manager of pete in a rapidly changing business envi­ assistant vice president for government Rod Dunnett the bank's business bank­ ronment. Cheever will participate in all affairs and special projects. In his new ing division, which pro­ phases of the legislative process, helping position, Phillips will assist with the po­ cesses all small business to draft and amend bills and provide tes­ litical, legislative and regulatory process/ loans in Nevada. Ingram timony for legislative committees. activities and in the identification and is responsible for the fi­ development of new business relation­ nancial management and PriMerit Bank recently announced the ships and insurance products for the firm. trust services division, hiring of Mariam Corcoran in its resi­ which manages trust as­ dential lending department in Reno.As a Commercial real estate broker, Ronald Diane Ingram sets for individuals and residential loan officer, Corcoran will G. Boniella, has joined Sullivan & corporations that need employee benefits, originate loans and work with builders, Knott, Inc., a Las Vegas-based business pension and profit sharing services. home buyers and Realtors in the Reno and investment real estate firm. Boniella BofA Nevada also appointed six other and Fallon area. specializes in leasing commercial and in­ employees as vice presidents: Joselyn dustrial properties in Southern Nevada. Cousins, senior community develop­ American Bank of Commerce has an­ He has participated in large leasing trans­ ment officer in compliance department; nounced that Ralph Borenstein has actions of more than 150,000 square feet.

July 1995 • Nevada Business journal 23

------tion among the fastest growing cities in throughout Nevada, particularly through the country," added Etter. "The growth its commercial banking centers located Nevada in population should result in an esti­ in Las Vegas and Reno. mated 28,000 new housing starts state­ U.S. Bank of Nevada is a subsidiary wide in 1995, and approximately the of U.S. Bancorp, the largest bank hold­ same number in 1996." ing company headquartered in the north­ Briels The bank recently introduced a mobile west and, with assets of nearly $22 bil­ home loan center in Southern Nevada lion, one of the nation's 35 largest. U.S. which travels to various areas in the com­ Bancorp operates other U.S. Bank sub­ munity. The program will soon be intro­ sidiaries in the Northwest, as well as fi­ duced in the Reno/Sparks area. nancial businesses providing mortgage BofA has community development lending, merchant services, equipment loan officers statewide, who assist pro­ leasing and investment and trust services. BofA becomes state's spective home buyers in low-income cen­ top mortgage lender sus tracts. Over the last several months, the bank has introduced new mortgage SBA study ranks Sierra Bank of America Nevada (BofA) is products and later this month will intro­ Bank as most "small now the largest residential mortgage duce a new FHAN A adjustable-rate business friendl)f" lender in Nevada, according to an inde­ mortgage product that will make it easier pendent report published by TRW REDI for first-time home buyers to qualify. Sierra Bank of Nevada is the most Marketrac. First among the 30 mortgage "small business friendly" bank in the lenders in the state, BofA held this posi­ state, according to a study conducted by tion for the first three months of the year, Money magazine names the U.S. Small Business Administration's having nearly 7 percent of the residential U.S. Bank best in Nevada Office of Advocacy. lending business statewide. Sierra Bank was the only Nevada bank BofA replaces Weyerhaeuser Mortgage According to a Money magazine sur­ named in a report on the study published as the No. 1 residential mortgage lender vey of 428 banks around the country, in the April edition of Entrepreneur in the state, which is the only other lender U.S. Bank is the "best bank in Nevada." magazine. The magazine listed 294 with 5 percent or more of the residential The ranking, reported in the June 1995 "small business friendly" banks ranked mortgage business. issue of Money, cited U.S. Bank's safety in the study, "Small Business Lending in "We are extremely proud of this latest and soundness, as well as its free check­ the United States." achievement of becoming the largest resi­ ing and home banking features as key to "Sierra Bank has always focused on dential mortgage lender in Nevada," said its high rating. The survey also exam­ the needs of small businesses," said BofA Nevada Chairman and Chief Ex­ ined each bank's willingness to lend to Randy Yost, executive vice president and ecutive Officer Richard A. Etter. "This its customers. chief operating officer. "This totally in­ accomplishment becomes even more im­ "At U.S. Bank, we pride ourselves on dependent study reflects the faith we have pressive when you realize how far we've providing financial products and services in such businesses." come in just two years. We've gone from that not only meet our customers' needs The study ranked institutions on five virtually last to first during this period." but also are available at an attractive criteria including: the number of loans Etter attributes the bank's success to a price," said Diane B. Torry, president made for less than $250,000; small-busi­ hard-working and experienced staff, as and chief executive officer of U.S. Bank ness loans vs. total percentage of bank well as a full range of products and re­ of Nevada. "U.S. Bank also strives to be loans; loans vs. total bank assets; the sources for virtually any type of poten­ an innovative leader in customer service bank's total deposits; and the total dollar tial home buyer. BofA has competitive by offering such services as PC banking, value of small-business loans. An over­ mortgage Joan products for first-time 24-hour telephone banking and enhanced all evaluation was also conducted. home buyers with flexible underwriting ATM services. It's rewarding to have The locally directed and managed Si­ criteria, as well as loan products for more our efforts noted by Money magazine." erra Bank of Nevada was established in established home buyers. U.S. Bank of Nevada is the state's third 1990, and plans to open a second office "Nevada continues to rank among the largest commercial bank, providing com­ in Carson City. The full-service bank is top two states for population growth, with prehensive financial products and ser­ a subsidiary of multi-bank holding com­ Las Vegas coming in at the No. l posi- vices to .consumers and businesses pany, Sierra Tahoe Bancorp.

24 Nevada Business journal • July 1995 "Even when NCRC's member financial institutions Lender consortium include: American Bank of Commerce; I make provides financing for American Federal Savings Bank; Bank affordable rental units of America Nevada; BankWest of Ne­ impossible vada; California Federal Bank, FSB; The Nevada Community Reinvestment Citibank, Nevada; Comstock Bank; First demands, they Corporation (NCRC), a nonprofit lend­ Interstate Bank of Nevada; First Secu­ ing consortium of 18 Nevada commer­ rity Bank; InterWest National Bank; somehow cial and savings banks, has funded two Laughlin National Bank; Nevada Bank­ of the largest affordable housing devel­ ing Company; Nevada State Bank; Pio­ opments located in Las Vegas and Reno. neer Citizens Bank of Nevada; PriMerit pull it of£" Both target households earning below 60 Bank, FSB; Sierra Bank of Nevada; Sun percent of area median income. State Bank; U.S . Bank of Nevada. M ike M arigold, Builder, Mamie Chinn Hechter, president of Reno, Nevada NCRC, stated the loan funding totaled $8 ,925,000. Desert View Apartments, BofA reports more than owned by Karen Street, a California lim­ $150 million in 1994 ited partnership, has 80 two-bedroom community lending units, 48 three-bedroom units and is lo­ we can do it for you. cated in Las Vegas. Terracina Apartments Bank of America (BofA) Nevada re­ is a 142-unit complex of one-, two- and cently reported a total of $154.6 million three-bedroom apartments. Terracina in Community Reinvestment Act-related One of the advantages of being Apartments was developed by a joint ef­ lending in Nevada during 1994. The locally based and operated with fort between USA Properties Fund, Inc. , bank's community lending provided our own on-site underwriting and Community Services Agency, a Ne­ much needed support for low- and mod­ depanment is that we can be more vada nonprofit corporation. Both projects erate-income home buyers and consum­ flexible and responsive to the needs are funded by BofA Community Devel­ ers, small businesses and multifamily af­ of Nevada builders. Whether it's opment Bank. Each project received a fordable housing. The 1994 community for lot, site loans or build-to-own tax credit allocation from loan total represented a 55 percent in­ loans, we'll do whatever it takes. the State of Nevada Housing Division. crease over the previous year. So if your company has special Terracina Apartments received federal Of the $154.6 million in community financing requirements and quick HOME funds which requires a minimum loans, $75.5 million applies toward the turnaround demands (and whose of 1 J units h~ rese.rv~d for those house­ 10-year Community Reinvestment Act d (Jm t't?), we can do ir for you. holds earning below 50 percent of the (CRA) goal established in 1992 between local area's median income. the bank and various community groups "Both developments are attractive, well throughout the state. BofA Nevada's managed and 100 percent occupied," said CRA loans in 1994 represented a 90 per­ Hechter. "Most importantly, both are pro­ cent increase over the bank's annual goal viding affordable rental units to quali­ of $39.5 million. fied families." "Last year's strong performance in the In addition to the above, NCRC has area of community lending demonstrates c~-lk committed over $13.5 million for 570 the bank's commitment to reach out to emmn[k units located in Fallon, Dayton, Carson low- and moderate-income people," said MEMBER F .O.I.C. City, Reno and Las Vegas. These devel­ BofA Nevada Chairman and Chief Ex­ opments are anticipated to be available ecutive Officer Richard A. Etter. "The Reno 827-65 98 late 1995 and first quarter 1996. Since bank's CRA loan portfolio continues to Carson City 687-2700 1992, the consortium has committed over show growth, which further supports the Minden 782-2311 $25 .6 million of its $40 million pool for need for more well-structured programs Las Vegas 631-1 515 m ore. than 830 affordable housing units that provide wider access to credit for throughout the state. low-income borrowers."

July 1995 • Nevada Business journal 25 Etter added the bank's strong CRA per­ est cellular provider in the United States, the freedom to communicate with people, formance last year was due in part to the will change its name to AT&T Wireless not places," said Taylor, who noted that bank developing stronger partnerships Services as part of its merger with AT&T. Las Vegas has the highest cellular usage with organizations that serve low- to The largest wired telephone service pro­ per capita in the country. "This will be moderate-income individuals, along with vider in the world, AT&T is also the achieved through AT&T Wireless Ser­ developing additional products and pro­ inventor of cellular technology. vices, which will combine McCaw's grams that are better designed to meet "The outstanding personalized cus­ expertise in cellular services with Bell the financial needs of these constituents. tomer service Las Vegans associate with Laboratories' new-product research and The majority of the BofA Nevada's Cellular One will be preserved and guar­ development to offer a host of benefits CRA lending occurred in the following anteed as we change our name to AT&T to our customers." areas: home mortgage loans in low- and Wireless Services," Taylor said. "And, McCaw Cellular Communications is moderate-income census tracts or house­ because of ·our partnership with AT&T, the nation's largest provider of wireless holds, which totaled more than $101 mil­ we can offer our customers some of the voice and data communications. It is also lion; conventional small business loans latest cutting-edge services available, as the fifth largest messaging service pro­ of $50,000 and less as well as loans to well as increase the capacity and infra­ vider and a world leader in air-to-ground minority- and women-owned businesses, structure of our digital and analog cellu­ communications services. which totaled more than $19.4 million; lar systems in Las Vegas." and Small Business Administration gov­ The name change reflects that McCaw ernment-assisted loans, which totaled Cellular Communications, doing business AmBank honored again more than $17 million. as Cellular One of Las Vegas, merged by VERIBANC The bank provided another $15 mil­ with AT&T in late 1994 in an all-stock lion in financing to low-income housing transaction worth $11.6 billion. Las Vegas-based American Bank of projects, and more than $1.4 million in "You will see us adding new features Commerce has earned "Blue Ribbon" consumer loans through its B*A*S*I*C and services onto our digital network in honors from VERIBANC, a national firm program. These loans, along with the the coming months," Taylor said. "We that rates financial institutions through­ home and small-business loans, utilize a will have offerings such as Caller ID, out the United States. number of nontraditional underwriting message wai'ting, alphanumeric paging, Blue Ribbon is the highest rating pos­ criteria that make it easier for low-in­ short messaging and a digital control sible from VERIBANC, which bases its come applicants to qualify. channel that will help extend a phone's annual ratings on data from the financial BofA Nevada's grants and charitable battery life by as much as ten times. We industry and from government regula­ contributions were also a significant part also have a host of other products cur­ tors. Only the top 25 percent of financial of its overall community outreach pro­ rently under development." institutions nationwide earn the Blue Rib­ grams in 1994. Last year, the bank con­ Many of these new services are the bon rating, according to officials at the tributed more than $510,000 to nonprofit result of McCaw Cellular's digital cellu­ Wakefield, Mass. bank rating service. organizations throughout Nevada. The lar technology, which will allow users to American Bank of Commerce has been grants help fund programs in the areas of send and receive all types of voice and awarded the Blue Ribbon every fiscal community investment and economic de­ data information through their cellular quarter for more than five years. velopment, education, health and human phones. The company, which is the only "It's positive news," said James services, conservation and the environ­ provider of digital cellular service in Las Bradham, president and chief executive ment, and culture and the arts. Vegas, is also preparing to release a line officer for American Bank of Commerce. of digital assistants such as electronic "We are proud of our performance and organizers, notebooks and databases. this rating shows that experts in the Cellular One of Las AT&T estimates the global informa­ financial community agree." Vegas becomes AT&T tion industry to be worth $15 trillion and American Bank of Commerce was Wireless Services wireless is the industry's fastest growing founded in 1979 by local business and segment. Today, more than 25 million community leaders with an asset base of Paul Taylor, regional vice president people use cellular service in the United $2 million. Today, the bank is Las Vegas' and general manllger of Cellular One of State~, and nearly '2& ,000 new o::u~tomer~ longe~t established, i.nde~ndent finan Las Vegas, recently announced that sign up for cellular service each day. cia! institution with $260 million in McCaw Communications, Inc., the larg- "What customers clearly want today is assets. The bank's holding company

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hroughout 1994, the Federal Reserve (Fed) actively pursued a policy of pushing interest rates upward. Repeatedly, official Nevada Taxable Sales Quarterly. 1985 - 1995 announcements pointed to the possibility of future inflation and T the importance of taking preemptive action. The three-month Billions U.S. Treasury bill rate, as of April, averaged 5.67 percent, up from 3.74 percent a year ago. Now the Fed, believing current interest rates are $6 breaking the forces of future inflation, has elected to take a "wait and see" position, hoping the desired "soft landing" finally appears. Yet, as is often $5

the case in economical matters, the ride may not be smooth. S4 If the Fed overreached in braking the economy, leading economic indicators will be among the first to signal economic turbulence. Unem­ $3 ployment rates, which in the early months of 1995, pushed below 5.5 percent, could quickly reverse the improvements experienced in 1994. $2

Unemployment rates, nationally and in Nevada, have hovered around this $1 non-inflationary rate for some time. Nevada's unemployment rate for

0 1 0 April was 5.5, the same rate reported nationally for March. National labor so I I " """ " " " 1965 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 markets, however, softened in April, with a jump in the number of unem­ ployed and a rise in the unemployment rate to 5.8 percent. Another indicator which merits close attention, is the rate of growth in Gross Domestic Product (GDP). The preliminary GDP growth rate for the Nevada Gross Gaming Revenue first quarter of 1995 was 6.21 percent, a rate indicating strong momentum. Quarterly, 1985 - 1995

Nevertheless, areas of weakness suggest slower future growth. In particu­ Millions lar, the rate of housing starts, one the of the sectors most likely to feel the pinch of higher interest rates, continues to show double-digit rates of $2,000 decline over last year's levels - down by 15.52 percent in April. One cannot expect to experience contractions of this magnitude without fur­ S1 ,500 ther contractions appearing elsewhere in the economy. Construction activity in Nevada, which is also bearing the burden of higher interest rates, presents a mixed picture at best. The latest construc­ $1 ,000 tion numbers for Las Vegas, coming off a banner year, are mixed. Resi­ dential permitting is down 16.05 percent, but on the other hand, commer­ S500 cial activity is up by a resounding 61.72 percent. Permitting for Reno, however, is down in comparison with a year ago: 26.35 percent for new

residences and 8.77 percent for new commercial. Not always able to $0 II II I II II " " II I 1985 1986 1987 1968 1989 1990 1991 1992 1993 1994 1995 forecast how interest-rate policies translate into market activity, we should simply note what we do know: interest rates affect levels of economic activity through long and varied responses. As such, key sectors may only now begin feeling the constraints set in motion last year. Air Passengers Nevada's gaming and tourism economy continues to enjoy growth and Quarterly, 1985- 1995 expansion. The state's gross gaming revenue grew at a rate of 4.7 percent above year-ago levels for March. Clark County recorded a solid 7.03 percent rate of growth, an impressive rate, given the strong record for 1994. Reno, awaiting the opening of its new downtown Silver Legacy Casino this summer, grew at a 2.65 percent rate. Visitor activity moni­ tored at the state's major airports also shows substantial growth over last year, up 8.24 percent at McCarran and 7.87 percent at Cannon. In short, even with the spread of casino gaming now well established throughout the nation, Nevada's key sector continues to compete vigorously. Other economic sectors have shared in Nevada's upward trend. Taxable sales increased 7.7 percent. Moreover, Nevada received a strong push from the rapid rate of population growth - up by 6.83 percent statewide.

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 R: Keith Schwer, UNLV Center for Business & Economic Research

30 Nevada Business Journal • July 1995 LATEST PREVIOUS YEAR CHANGE DATE UNITS PERIOD PERIOD AGO YRAGO UNEMPLOYMENT Nevada April, 1995 % 5 .5 5.6 6.0 -8 .33% Los Vegas April, 1995 % 5 .6 5 .4 6 .0 -6.67% Reno April, 1995 % 5 .2 5.7 5.3 -1 .89% U.S. March, 1995 seasonally adj. 5 .5 5 .4 6 .5 -15.38% RETAIL ACTIVITY Nevada To xoble Soles March, 1995 $thousand 1,787,806 1,524,009 1,659,999 7.70% Clark County March, 1995 $thousand 1,086,421 930,815 1,022,848 6.22% Washoe County March, 1995 $thousand 289,300 259,901 290,158 -0.30% U.S. Retail Soles March, 1995 $mil lion 191 ,658 191 ,317 184,556 3.85% GROSS GAMING REVENUE Nevada March, 1995 $thousand 598,407 582,342 571 ,568 4.70% Clark County March, 1995 $thousand 473,754 466,811 442,636 7.03% Washoe County March, 1995 $ thousand 77,103 68,022 75, 113 2.65% CONSTRUCTION ACTIVITY Los Vegas Area New Residences 1st qtr 1995 #permits 4,080 4 , 185 4 ,860 -16.05% New Commercial Permits 1st qtr 1995 #permits 207 194 128 61.72% Reno Area New Residences 1st qtr 1995 #permits 422 621 573 -26.35% New Commercial Permits 1st qtr 1995 #permits 52 52 57 -8.77% U.S. Housing Storts April , 1995 thousand 1,236 1,231 1,463 -15.52% Totol Construction March, 1995 $billion 525.1 527.2 496.0 5 .87% HOUSING SALES los Vegas Area Average Soles Price l11 1st qtr 1995 $ 126,713 128,757 144,984 -12.60% Average Cost/Square Foot 1st qtr 1995 $ Pt;lr sq. ft. 76.15 77.38 79.31 -3 .98% Average Mortgage Rote121 1st qtr 1995 % 8.24 8.20 7 .19 14.60% Washoe County Average Soles Pricel11 1st Half 1994 $ 168,1 99 170,325 157,825 6 .57% Average Cost/Square Foot 1st Half 1994 $ per sq. ft. 92.67 96.88 92.42 0 .27% Average Mortgage Rotei2J 1st Half 1994 % 7 .90 7 .20 7.70 2.60% U.S. Home Soles Mo~ch, 1995 thousand 577 560 722 -20.08% TRANSPORTATION Totol PossengersPI McCarron Airport, LV 1st qtr 1995 passengers 6,843,438 6,809,896 6,322,338 8.24% Connon Airport, Reno 1st qtr 1995 passengers 1,398,512 1,350,585 1,296,464 7 .87% State Toxoble Gasoline Soles March, 1995 thousand gal. 63,016 54,720 62,936 0 .13% POPULATION ESTIMATES Nevada July, 1994 people 1,494,230 1,398,760 6 .83% Clark County July, 1994 people 971 ,680 898,020 8.20% Washoe County July, 1994 people 282,630 271,770 4.00% NATIONAL ECONOMY Consumer Price lndex141 March, 1995 1982-84= 100 151 .4 150.9 147.2 2.85% Money Supply - M 1 March, 1995 $bill ion 1, 147.8 1, 147.1 1 ' 141.0 0 .60% Prime Rote April, 1995 % 9 .00 9 .00 6 .25 44.00% Three-Month U.S. T-Bill Apri l, 1995 % 5.67 5.73 3.74 51.60% Gross Notional Product 1st qtr 1995 $bill ion 6,982.9 6,897.2 6,574.7 6 .21%

NOTES: (1) houses, condos, townhouses; (2)30 yr. FHA; (3) enplaned/deplaned passengers; (4) all urban consumers SOURCES : Nevada Dept. ofToxotion; Nevada Employment Secu ri ty Dept.; UNLV, Center for Business and Economic Research; UNR, Bureau of Business and Economic Research; US Dept. of Commerce; US Federal Reserve. COMPILED BY: UNLV, Center for Business and Economic Research

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