Author Archives: Don Harris

About Don Harris

Don Harris is a freelance writer in Phoenix who reports on a variety of business-related topics. He also serves as copy editor/reporter for Arizona Capitol Times. Immediately prior to joining the Capitol Times in 2001, for nearly nine years Harris was a public information officer for two state of Arizona agencies, first with the Department of Commerce and then the Department of Insurance. Harris also covered politics, organized labor and general news events for The Arizona Republic for 19 years, periodically serving as an assistant city editor. At The Republic, Harris covered the Arizona House of Representatives for 10 years, as well as five national political conventions and most major Arizona political races. He has received several journalism awards in Arizona and Chicago, where he had been a reporter for a daily newspaper for a number of years.

Corporate Giving - AZ Business Magazine November/December 2011

Corporate Giving More Discriminating, But Still Charitable

Like the economy, a dip in corporate giving appears to have bottomed out, but that charitable landscape has changed both for givers and receivers.

Corporations are re-evaluating which not-for-profit organizations they support, and in some cases businesses are providing more volunteers and less cash. At the same time, fund-raising efforts are changing. Some elaborate parties designed to attract big donors are a little less gala. Instead of the usual full-blown dinner, some groups are opting for less expensive cocktail parties.

Nationally, corporate giving rose 10.6 percent (8.8 percent adjusted for inflation) in 2010, according to the Giving USA Foundation. In Arizona, Laine Seaton of the Greater Arizona Chapter of the Association of Fundraising Professionals says corporate giving is improving, with some caveats.

“It’s starting to get a little better – slowly,” she says. “Two years ago was definitely worse than it is now. I’m seeing that more companies are looking at alternate ways to support nonprofits. Definitely, volunteerism is up. Corporations and nonprofits have to be more flexible. Those chicken dinners are hard to fill.”

At the St. Mary’s Food Bank Alliance, demand for food has nearly doubled in the past three years to a record 74 million pounds, which equates to 285,000 meals a day going to 700 agency-partners in 10 Arizona counties. St. Mary’s depends on a three-pronged operation to serve the increased number of needy and unemployed: financial donations, volunteers to help run the massive distribution center at 31st Avenue and Thomas Road, and food donations.

Terry Shannon, president and CEO of the food bank, says everyone is tightening their belt during these tough economic times. “But, fortunately, the economy has caused many corporations to refocus some of their support,” he says. “Maybe the total they can give is down, potentially donating to fewer nonprofits and focusing on basic needs. Obviously, we supply a very basic need. Our corporate financial support is strong.”

Volunteering is strong as well, saving the food bank $5 million a year in labor costs. “Corporations in Arizona are encouraging employees to volunteer more and more,” Shannon says. “At our main distribution center, we can handle 150 to 200 volunteers at a time. We get many corporate groups from companies like American Express, Wells Fargo, Bank of America and Target. It keeps their employees together – sorting, bagging and boxing food for distribution – and it almost functions as a team-building effort, rather than everyone doing their own thing.”

Food donations from manufacturers and retailers represent the third leg of the food bank’s operations. Some 55 trucks are dispatched to 280 grocery stores daily to pick up what Shannon calls “non-salable but edible” food items, such as a dented can of soup or a package of buns with one that is crushed.

“We’re a food distribution business,” Shannon says, “but we do it with donated and rescued food. Imagine what would happen if we had the food, but no money to put fuel in those 55 trucks (we use to distribute) or if we didn’t have the volunteers.”

In addition to having its employees volunteer at St. Mary’s Food Bank, Wells Fargo announced it is contributing $38,000 to 20 non-profits in recognition of volunteer efforts throughout the community. Twenty Wells Fargo Arizona team members were named Volunteer Service Award winners. Two will have $10,000 given to the charity of their choice and 18 will have $1,000 given to their selected charities.

In 2010, Wells Fargo team members reported nearly 80,000 volunteer hours in Arizona. They served as mentors, board members, project leaders, fund raisers, educators and more. Wells Fargo also donated $5 million in 2010 to nonprofits and schools in Arizona.
Despite the struggles of some corporations and non-profits, Phoenix Suns Charities is cashing in on its community-based reputation. In the past year, the organization distributed a record $1.36 million to 178 charitable organizations. That tops last year’s record of more $1.2 million awarded to 156 recipients, and marks the two best years since Phoenix Suns Charities was formed 23 years ago.

Kathryn Pidgeon, executive director of the NBA team’s charitable arm, has an explanation for the impressive results. “We are connected at the hip to a stellar organization – the Phoenix Suns,” she says. “The community loves the Suns. There is a strong history of giving to the community. Our donors really believe in us, trust us. They know the money is going for the kids.”

The $11.6 million in donations the Phoenix Suns Charities has distributed since 1988 is separate from the free tickets, signed memorabilia and personal appearances by team members, dancers and the mascot, the Gorilla. “My number is all cash,” Pidgeon says.
Grants from Suns Charities start at $1,000. The largest donation of $100,000 went to Improving Chandler Area Neighborhoods to build a basketball court in its new facility in downtown Chandler.

Phoenix Sun Charities is one that still relies on a gala to raise money. “We’ve given people a fabulous party,” Pidgeon says. “It’s wildly successful with great entertainment. All the players are there and they’re accessible.”

Pidgeon says the gala, which is partly underwritten by corporate sponsors, netted $1.1 million last March.

There are numerous other ways Phoenix Suns Charities generates money for its donations. The newest venture is an official state of Arizona Phoenix Suns license plate that produced $39,000 the first year and $51,000 the second year.

A new development in fundraising, says Seaton of the Fundraising Professionals group, is the target audience. The most giving demographic has been women in the 55 to 65 age group. “Nonprofits these days are also looking at twenty-somethings,” she says. “They didn’t have money to give. That’s not the case anymore. Young people want to make a difference. They have energy and new ideas. Social media is part of that effort.”

Arizona Corporate Angels

National Kidney Foundation of Arizona

 National Kidney Foundation, Corporate Giving
4203 E. Indian School Rd., Suite 140
Phoenix, AZ 85018
(602) 840-1644
azkidney.org

Arizona’s Children Association

Arizona Children's Association, Corporate Giving
2833 N. 3rd St., Phoenix, AZ 85004 | (602) 234-3733 | arizonaschildren.org
2700 S. 8th Ave., Tucson, AZ 85713 | (800) 944-7611 | hope3ways.org

United Cerebral Palsy of Central Arizona

United Cerebral Palsy of Central Arizona, Corporate Giving
1802 W. Parkside Ln.
Phoenix, AZ 85027
(602) 943-5472
ucpofcentralaz.org

Arizona School of Choice Trust

Arizona School of Trust, Corporate Giving
P.O. Box 1616
Glendale, AZ 85311
(623) 414-3429
asct.org

Phoenix Rescue Mission

 Phoenix Rescue Mission, Corporate Giving
1801 S. 35th Ave.
Phoenix, AZ 85009
(602) 233-3000
phoenixrescuemission.org

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For more information about these Arizona Corporate Angels and their respective corporate giving, view the AZ Business Magazine Nov/Dec 2011 digital issue.

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Arizona Business Magazine November/December 2011

 

 

Don Cardon, Arizona Commerce Authority

Don Cardon: The Driving Force Behind The Arizona Commerce Authority

A political appointee with a successful track record in the private sector, Don Cardon has become the face of the new and innovating Arizona Commerce Authority. While Gov. Jan Brewer is chair of the public/private economic development agency and sports mogul Jerry Colangelo serves as co-chair, it is Cardon, as president and CEO, who has his hands on the reins.

Leaders who have gotten to know Cardon better during the process of creating the Arizona Commerce Authority say he keeps his cool at all times, in good days and bad, is respectful of all points of view, is thoughtful, and someone who projects an element of stability for the state of Arizona.

But even more importantly, according to Roy Vallee, outgoing chairman and CEO of Avnet, are Cardon’s financial skills.

“Not only does he have numeric literacy, (he also has an)  understanding of financing, how to pull deals together and how to interact with banks and other sources of capital,” Vallee says.

Cardon began his employment with state government in March 2009 as director of the Arizona Department of Housing, and just a couple of months later Brewer appointed him director of the Arizona Department of Commerce, predecessor of the ACA. Before joining the state, Cardon was president and CEO of Cardon Development Group, creating low-income workforce housing projects in Phoenix, Gilbert, Eloy and Winslow, and was the visionary behind the group that helped create CityScape, a mixed-use development in Downtown Phoenix.

Cardon’s stated intention was to see the ACA through its formative stage until a permanent president and CEO could be brought onboard, enabling him to return to the more lucrative private sector. But as the ACA board of directors took shape, comprising the cream of Arizona’s business and community leaders, Cardon was urged by Brewer, Colangelo and board member Michael Manson to remain.

“We sat him down and said you can’t create vision and hope with no structure or follow through,” says Manson, co-founder/executive chairman of Motor Excellence in Flagstaff. “That’s the worst kind of leadership. He realized that was true. We identified him as one of the few people in the state who had the political connections, the Commerce Department background and the business connections to make this work.”

Manson, who has founded several other companies, including PETsMART, says Cardon brings enthusiasm, energy and integrity to the ACA.

“He’s eternally optimistic and politically sensitive,” Manson says. “It takes a unique person to be politically rooted, but business oriented, and to be able to handle all of the political and business entities and very strong personalities it requires. He is truly focused on doing the right things for this organization.”

Indeed, focus is a key word in Cardon’s vocabulary. In guiding the ACA, the focus is attracting and retaining businesses in science and technology, aerospace/defense, renewable energy, and small business/entrepreneurship. He once told an interviewer: “You can’t just kind of throw a line in water and say whatever fish comes along you’ll take, which isn’t to say we won’t respond to any other opportunities. But you have to know what you’re trying to go after.”

At the Commerce Department, economic development was “a shotgun approach,” Cardon says. It was an approach he intends to avoid.
“There was no focus within the department,” he says. “Because of the lack of focus, I don’t believe the Legislature has had a great deal of confidence in our efficiency, our ability to accomplish what we set out to do. It was an agency that has really lost touch with what it’s really supposed to be about.”

Another ACA board member, Mary Peters, president of a consulting group bearing her name, touts Cardon’s private-sector background.
“Don understands what it takes to attract and retain businesses in Arizona,” says Peters, whose resume includes stints as federal highway administrator of the U.S. Department of Transportation in President George W. Bush’s administration from 2006-2009, and director of the Arizona Department of Transportation from 1998 to 2001.

“He knows how to put projects together and how to manage,” Peters says. “That’s the value I see in Don and what he brings in the transition from the Commerce Department, having that continuity. Having spent most of my professional career in the public sector, it’s helpful for me to have someone with that private-sector experience to realize what businesses are looking for. I have a different perspective. I know very well the regulatory side of government. I know what it’s like to work through issues with government agencies so those issues aren’t barriers to companies that would like to come into Arizona.”

When Vallee of Avnet, also on the ACA board, heard about a move to encourage Cardon to accept the top ACA job, even after a search firm had been hired and specs of the job had been outlined, his instant reaction was, “That’s fantastic.”

The reasons: Cardon had a good track record at the Commerce Department and had been intimately involved in the creation of the Commerce Authority.

“He understands the history and the purpose of what we’re trying to accomplish,” Vallee says. “This was a brand new entity, and if we recruit someone who had not been involved in creating it, that person would flounder for a while trying to figure out what the job is all about.”

Because the ACA is a public/private partnership, having a CEO with experience and expertise in both areas is considered a huge benefit.

“He is better able to manage that environment very, very well — better than anyone with one viewpoint or the other,” Vallee says.

Vallee mentions Cardon’s core values, especially integrity.

“We all want someone in that role we can trust,” he says. “People are going to want to do business with someone they can trust, whether it’s investment coming from within state or from outside. As people get to know Don and develop that trust, it’s going to be beneficial to economic development.”

Vallee pauses and adds, “Don is a good man and a good executive, which makes him a really great fit for this job.”

[stextbox id="grey"]For more information about the Arizona Commerce Authority, visit www.azcommerce.com.[/stextbox]

Arizona Business Magazine September/October 2011

 

Arizona Commerce Authority - AZ Business Magazine September/October 2011

Arizona Commerce Authority Aims To Bolster The Business Environment

The new kid on Arizona’s economic development scene is poised to shake things up. The Arizona Commerce Authority (ACA), a public/private entity, is not merely a name change, a rebranding of the Arizona Department of Commerce that over the years received its share of praise and an increasing level of criticism. And it’s not just a committee of top-shelf business leaders.

“It’s more than that,” says Don Cardon, president and CEO of the Arizona Commerce Authority. “It’s really a call to arms.”

Created by Gov. Jan Brewer through an executive order a year ago, and formally established by the Arizona Legislature early this year, the Arizona Commerce Authority is the cornerstone of the Arizona Competitiveness Package, a mix of tax benefits and incentives targeting quality job growth. The Arizona Commerce Authority’s leadership board consists of 17 of Arizona’s top CEOs who provide oversight and valuable input, with House Speaker Andy Tobin and Senate President Russell Pearce as ex officio members. Brewer chairs the Arizona Commerce Authority, and sports entrepreneur Jerry Colangelo serves as co-chairman.

The state’s university president, chair of the Rural Business Advisory Council and other committee chairs round out the balance of the 31-member ACA board.

The leadership board’s focus is on growing and diversifying Arizona’s economy and creating quality jobs throughout the state. The ACA works closely with such key partners as the Science Foundation Arizona, the three state universities, regional economic development groups and local communities.

The ACA is targeting these key base industries — aerospace and defense, renewable energy, science-technology, and small business and entrepreneurship. It is funded through existing payroll withholdings under an annual operating budget of $10 million, plus a so-called deal-closing fund of $25 million, some of which will be allocated for job training.

Michael Manson, an ACA board member and founder/executive chairman of Motor Excellence in Flagstaff, says he thinks the quasi-public agency will produce results for a number of reasons.

“By involving business leaders as we have and funding it by government we are removing some of the politics, enabling more performance and quicker response to commercial opportunities,” says Manson, who also founded PETsMART. “The pendulum swung a little far before the recession toward government regulations, but we need to get back to being more oriented toward entrepreneurial commercial opportunities.”

Mary Peters, president of Mary E. Peters Consulting Group, says the ACA draws from the successful endeavors of other states.

“We now have a mindset that Arizona is open for business,” says Peters, a former federal highway administrator with the U.S. Department of Transportation and former director of the Arizona Department of Transportation. “We’ll do what we can, especially in the aerospace and defense industries. If we’re not out there working to bring them to Arizona, other states will.”

Under the deal-closing Arizona Competes Fund, a company will need to achieve certain performance measures including average employees’ wages above the county’s average wage, health insurance coverage minimums and other requirements similar to the state’s existing job-training program. Backers say the fund will spur investment in projects in the targeted industries.

It replaced the inactive Commerce and Economic Development Council deal-closing fund, is controlled by CEO Cardon, and puts Arizona among the top one-third of states with aggressive economic development programs, supporters say.

Funds provided to growth projects must result in a net benefit to the state, consistent with the Arizona Constitution’s gift clause. In addition, an economic impact analysis by an independent third party will be conducted on all projects to determine potential return on investment benefits to the state. Furthermore, funding will be awarded with contractual provisions for performance and “claw-back” of funds for non-performing projects.

The Competitiveness Package extends the existing job-training program, a reimbursable grant program for job-specific training plans for employers creating new jobs or increasing the skill and wage levels of current employees.

Arizona’s Enterprise Zone Program is replaced with a new Quality Jobs Tax Credit for new job creation statewide. This tax credit is performance based on net new job creation and capital investment with specific eligibility qualifications for urban and rural businesses.

The tax credit for each new quality job created is $3,000 per year for three years and is limited to 400 new jobs per employer, per year. The program is capped at 10,000 new jobs per year. Experts say the program will increase Arizona’s competitiveness ranking to No. 3 from No. 9 in the Mountain West.

On the tax side of the equation, the electable sales factor for multistate corporations increases to 100 percent from 80 percent in equal increments from 2014 to 2017. A corporation that conducts business both in-state and out-of-state must apportion its income from business activity based on the ratio of property, payroll and sales in

Arizona compared to the corporation’s property, payroll and sales everywhere.

The corporate income tax rate is reduced by 30 percent to 4.9 percent from 6.97 percent in equal increments from 2014 to 2017. The change is expected to improve Arizona’s national ranking from 24th to No. 5, and from No. 6 to No. 3 in the Mountain West.

Arizona Commerce Authority

Under personal property, depreciation schedules are further enhanced for prospective acquisitions of commercial personal property on or after 2012.
Colangelo, partner of JDM Partners, explains his determination in agreeing to serve as co-chairman of the Arizona Commerce Authority.

“We will eliminate all distractions in pursuit of the ultimate goal — restoring economic vitality and stability to our state,” says Colangelo, former top executive of the Phoenix Suns and Arizona Diamondbacks. “Our new structure automatically eliminates the agency’s culture of entitlement and political sloth, and we have introduced what I believe to be a ferocious approach to both retaining and attracting business for the benefit of Arizonans, their families and our children.”

For more information about the Arizona Commerce Authority visit www.azcommerce.com.

Good Samaritan Hospital - AZ Business Magazine Mar/Apr 2011

Arizona’s Health Care Industry Has Flourished From Cottages To World-Class Facilities

A Century of Care

From cottages to world-class facilities, Arizona’s health care industry has flourished

Mayo Clinic Hospital - AZ Business Magazine Mar/Apr 2011 In the nearly 100 years since Arizona became a state, the health care sector has become a powerful economic force.

According to a study by Arizona State University’s L. William Seidman Research Institute, Arizona’s hospital community alone employs more than 80,000 people and contributes $11.5 billion to the gross state product. Indirectly, hospitals create about 120,000 additional jobs, more than the combined populations of Coconino, Graham and Santa Cruz counties.

Sisters of Mercy

It all started some 17 years before statehood in January 1895, when the Sisters of Mercy had collected enough money to rent a six-bedroom cottage at Fourth and Polk streets in Downtown Phoenix. Each room was equipped with two beds for TB patients, and thus was born St. Joseph’s Sanitarium, predecessor of St. Joseph’s Hospital and Medical Center and the first hospital in Phoenix. Downtown Phoenix 1900s - AZ Business Magazine Mar/Apr 2011

In the mid-1940s, the nuns purchased 10 acres at Third Avenue and Thomas Road, which was part of an old dairy farm. Today, St. Joseph’s is a 670-bed, not-for-profit hospital that is one of the cornerstones of the state’s health care industry.

A second giant in health care, Good Samaritan Hospital of Phoenix, launched its first facility in an apartment building at Third Street near Van Buren in 1911. Initially incorporated as the Arizona Deaconess Hospital and Home, it opened with 15 beds.

One-hundred years later, Banner Good Samaritan Medical Center in Downtown Phoenix is the flagship of Banner Health, with more than 662 licensed patient care beds. Banner Good Samaritan employs more than 4,200 health care professionals and support staff. Nearly 1,700 physicians representing more than 50 specialties work with Banner Good Samaritan staff to care for more than 43,000 inpatients a year.

Another early entry in the health care scene was the State Asylum for the Insane, which was rebuilt after a fire in 1911. In 1924, the asylum was informally renamed Arizona State Hospital.

Established in 1943 as a community hospital, Tucson Medical Center is among the 300 largest hospitals in the country. It is licensed for 650 adult and skilled nursing beds, and serves more than 30,000 inpatients and 122,000 outpatients a year.

St. Luke Hospital - AZ Business Magazine Mar/Apr 2011In 1971, University Medical Center — a private, nonprofit hospital located at the Arizona Health Sciences Center adjacent to the University of Arizona in Tucson — was established. UMC is Arizona’s only academic medical center, and earlier this year it became an international focal point for neurosurgery and trauma care after a gunman shot and wounded U.S. Rep. Gabrielle Giffords (D-Ariz.) and killed six people.

In Northern Arizona, the Flagstaff Medical Center, a not-for-profit hospital, was founded in 1936. A part of the Northern Arizona Healthcare family, it has some 270 beds and its medical staff includes about 200 physicians. Among its specialties are cancer, heart and sports medicine.

Health care continues to be a concern on Indian reservations throughout Arizona, particularly in some of the remote regions. A relatively new program, the American Indian Research Center for Health is designed to improve the health status of Native Americans and increase the number of Native American scientists and health professionals engaged in research. Classes for the student-training component of the program are held at the University of Arizona.

Read more…

Construction Industry, AZRE Magazine March/April 2011

Arizona Construction Industry Gains Footing In 2011

Fueled by education-related projects, another new Cactus League spring training facility and Indian casinos, the construction industry in Arizona appears to be gaining footing in 2011.

Though not experiencing a full-scale rebound, contractors have reasons to be somewhat optimistic. For example, K-12 school districts around the state won voter approval in November of bond issues and budget overrides totaling more than $500M — but not all of the money is earmarked for construction or remodeling.

Contractors also anticipate increased activity in the solar energy field, thanks in part to SB 1403, approved in 2009. The law offers tax incentives for businesses locating alternative and solar energy manufacturing plants and corporate headquarters in Arizona.

Perhaps the highest-profile project that attracted numerous general contractors is the proposed spring training stadium and facilities for the Chicago Cubs in Mesa. Beth Huning, Mesa city engineer, says the city hopes to break ground on the 100-plus acre project southeast of the intersection of the Loop 101 and 202 freeways by the end of 2011. The Cubs want to use their new facility for spring training in 2013.

Mesa voters on Nov. 2 approved a ballot measure that allows the city to spend up to $84M for a new stadium, practice fields and training facilities. In addition, city officials have promised to spend no more than $15M for associated infrastructure improvements. The Cubs will be responsible for any cost overruns, and plan to build a “Wrigleyville West” entertainment and retail complex next to the baseball facilities.

Mortenson Construction, which just completed Salt River Fields at Talking Stick, the new spring training home of the Arizona Diamondbacks and Colorado Rockies at Loop 101 north of Indian Bend Road on the Salt River Pima-Maricopa Indian Community, was among the general contractors vying for the Cubs facility.

George Forristall, director of business development for Mortenson, says the firm is involved in major projects at all three state universities. He cites two Arizona State University recreation facilities — one at the Polytechnic campus in Mesa and one at the ASU West campus — each in the $17M range; a $53M Health & Learning Center at Northern Arizona University in Flagstaff that may not break ground until 2012; and an expansion of the north end zone at the University of Arizona football stadium in Tucson. The UA project, estimated at $50M, includes replacing aluminum seating with 5,000 upgraded seats, new concession concourses, additional restrooms, and elevators to improve access for the disabled.

Robert “Bo” Calbert, Southwest regional president of McCarthy Building Companies, says his firm expects to be active in public school projects, considering the success of numerous bond issues and budget overrides totaling a half-billion dollars.

“The K-12 market is a pretty big market for us,” Calbert says. “We expect to see several projects this year — not a ton compared to the last few years, but it’s a steady market.”

Among the successful school districts were Kyrene Elementary, $116.9M; Scottsdale Unified, $115M; Chandler Unified, $84.3M; Washington Elementary, $65M; and Marana Unified, $43M.

“A lot of schools will do upgrades and renovations, but not much new construction,” Calbert says. “Considering the state of the economy, it’s a fairly active market, albeit smaller than two-three years ago.”

He suggests a reason for the wave of successful bond issues: “The public has seen … state cuts in education spending. If not for bond issues, the needs of these schools would not be met.”

Many of the projects will involve heating and air-conditioning upgrades, with some schools opting for solar devices.

McCarthy, making a big push into solar, has secured one contract and was closing in on a second substantial deal, Calbert says. He sees solar, particularly in Arizona with abundant sunshine and relatively low-cost construction, as an industry for the present and future, though challenges remain for financing.

“We’re betting on it,” he says.

McCarthy is building a new hotel for the Pasqua Yaqui Tribe near Tucson and hopes to land the Navajo Nation’s proposed Twin Arrows Casino in Northern Arizona. And there is talk of a new Fort McDowell Mohave-Apache casino near Fountain Hills, Calbert says.

In addition, despite mounting local opposition, David Jones, president and CEO of the Arizona Contractors Association, says he expects the Tohono O’odham Nation to be successful in building a resort and casino adjacent to Glendale for an estimated $500M. Also in 2011, Jones sees a continuation of healthcare and hospital construction, solar projects in the Kingman and Gila Bend areas, a private prison near Prescott, mining projects southeast of Tucson and near Patagonia, and perhaps federal projects to beef-up security along the border with Mexico.

Forristall says the formation of the Arizona Commerce Authority, a public/private agency to spur economic development, is “a very positive sign.” He also praises the efforts of the Greater Phoenix Economic Council in utilizing the tools in SB 1403 to attract solar projects.

Forristall sees a gradual recovery in 2011. He says 2009 was a tough year for construction and 2010 basically maintained the status quo. “I see 2011 — not a U-shape — but I see a bit more activity, more optimism,” he says. “So we’re positive about the outlook.”

For more information about the construction industry and the projects mentioned in this story, visit:

mortenson.com

mccarthy.com

mesaaz.gov/engineering/cubs.aspx

AZRE March/April 2011 

Arizona's high technology industry - AZ Business Magazine Jan/Feb 2011

Far-reaching Initiatives Are Driving The AZ Tech Council

When it comes to new initiatives to promote and develop Arizona’s high technology industry, there is no telling how far the Arizona Technology Council will go.

Would you believe … China? A 10-day, fact-finding journey — led by Arizona Technology Council President and CEO Steven Zylstra — to one of the oldest nations on the planet ranks as the most spectacular effort to assist Arizona’s technology companies and individuals. But there’s much more.

For example, Consultants on Demand, a program run by Dick Stover, CEO of Go1099.com, connects businesses with consultants and professionals for various contract services. It’s free to all Tech Council members.

With the addition of Consultants on Demand to the council’s website, members can post projects and special assignments without charge. Consultants and professionals can access and bid on these projects, also without charge.

Then there is the Mentoring Program, launched in 2010 to provide Tech Council members with a venue for strengthening and building their business knowledge and network. A pool of talented and experienced business professionals is available to fill the role of mentors. Under the program, a mentor spends a year working with a Tech Council member on mutually agreed upon goals for business and personal growth. In addition, the Tech Council has speakers address the group throughout the year on various business topics.

“As the group progresses through the program,” Zylstra says, “new relationships will be formed via networking, and stronger companies will be built by learning new business practices for strategic planning and efficient operational management.”

Because the technology industry is still somewhat male dominated, Women in the Workforce is a program that provides an opportunity for women in technology to share ideas and experiences. Teresa Snyder, marketing director for OneNeck IT Services, says the program is an attempt to fill a need for women in technology.

Arizona Business Magazine Jan/Feb 2011

AzHHA’s New President And CEO Laurie Liles - AZ Business Magazine Sept/Oct 2010

AzHHA’s New President And CEO Is Ready To Tackle The Industry’s Challenges

A familiar face has been named the new president and chief executive officer of the Arizona Hospital and Healthcare Association (AzHHA). Laurie Liles assumed her new role on Sept. 7, succeeding John Rivers, who will be available as a consultant until his retirement becomes official in January.

Selected by the AzHHA board of directors on June 3 after an extensive national search, Liles is a natural for the position, having most recently served as senior vice president of public affairs for the organization. In that role, Liles was the association’s chief lobbyist, putting her in charge of legislative and regulatory advocacy, and making her a familiar face at the state Capitol.

In fact, when she joined the association in 1991, Liles already was well known and respected at the Legislature. She was an intern at the Arizona House of Representatives in 1985, and in 1986 joined the House research staff. It was her first real job coming out of college, where she had majored in political science at Northern Arizona University.

The years at AzHHA that Liles spent lobbying lawmakers have given her a solid foundation for the tasks ahead. She also worked closely with the chief executive officers of AzHHA-member hospitals throughout the state.

“My role as chief lobbyist has given me a great deal of exposure to the challenging issues our members face,” Liles says. “It also enabled me to advance their interests with the regulatory entities they interact with.”

While she savors the experience and knowledge she gained as a lobbyist, Liles doesn’t plan on visiting the Capitol on a regular basis anymore.

“As the head of an advocacy organization, I will be ultimately responsible for accomplishing our advocacy goals,” she says, adding she will work closely with her staff and her replacement, who will tend to the day-to-day duties of lobbying.

Myriad challenges lie ahead, but No. 1 on Liles’ list is not unique to hospitals or the health care industry: the economy.

“The recession has been hard on everyone, and hospitals are no exception to that,” Liles says. “Our members continue to provide high-quality care, and the challenge going forward is to maintain that quality as resources become more and more precious.”

Arizona’s fiscal crisis is expected to continue for the next few years, Liles says, and as the state slowly recovers hospitals will be particularly vulnerable to any government-imposed cuts to Medicare and the state’s Medicaid program, the Arizona Health Care Cost Containment System (AHCCCS). The question remains how the state will pay for ever-expanding AHCCCS rolls. Enhanced federal matching funds, which faced some opposition in Congress, would ease the burden.

A close second in priorities is implementation of the new federal health care reform law. Fortunately, Liles has maintained a close working relationship with Arizona’s congressional delegation, particularly staff members who deal with health care issues. In addition to e-mails and phone calls, Liles has made it a practice to meet in Washington, D.C., with congressional members a couple of times a year.

Norm Botsford, chairman of the AzHHA board of directors, cited the federal health care law when he announced Liles’ appointment.

“The state’s health care community and citizens will be well served by Ms. Liles’ leadership as we begin the process of implementing the historic health care reforms signed into law by President Obama.” he stated.

But one of the challenges facing Liles and hospital administrators throughout the state does have a silver lining. Asked what good news hospitals can expect in the year ahead, Liles took a long pause before saying: “The really positive news for health care is the increased coverage that the federal health reform legislation brings. Having 32 million more Americans who previously had no insurance be covered is a positive development, but with it comes challenges of providing care for them.”

http://azbigmedia.com/tag/september-october-2010-2

Banner Baywood Medical Center

Arizona’s Health Care Providers Are Working To Eradicate On-Site Infections

Hospital-acquired infections — illnesses that attack patients after they have been admitted — have health care officials taking myriad steps to combat, control and prevent this insidious enemy.

One of those steps is a name change courtesy of the U.S. Department of Health and Human Services. They now are called healthcare-associated infections, or HAIs.

Jessica Rigler, HAI prevention coordinator at the Arizona Department of Health Services, explains the reasoning behind the terminology change: Health care infections occur not only in hospitals, but in all health care venues, including long-term care, assisted living, and urgent care centers. In addition, Rigler says, these infections are brought into a hospital by an ailing patient, and not necessarily acquired there.

Nevertheless, whatever term applies, HAIs present a serious challenge for hospitals in Arizona and throughout the country. In 2007, the Centers for Disease Control and Prevention estimated the number of HAIs in U.S. hospitals was 1.7 million, resulting in nearly 99,000 deaths each year.

In April 2008, Banner Baywood Medical Center in Mesa was thrust into the spotlight following an HAI outbreak. The staff launched an aggressive program to deal with the situation, such as correcting air-pressure problems in some of the 10 operating rooms, and firing an overnight cleaning crew that was found to have missed germs on operating room floors, equipment and operating tables.

The hospital also limited the number of students and observers allowed in operating rooms, switched to thicker surgical wrap, and directed surgeons to wear only hospital-laundered scrubs.

Seven months after numerous changes were implemented, Banner Baywood, a general, acute-care hospital that performs about 10,000 surgeries each year and serves many senior citizens, detected just one surgical-site infection, according to Chris Halowell, director of perioperative services at the hospital.

Arlene Gimbel, chief nursing officer at Banner Baywood, says some infections are the direct result of overuse of antibiotics.

“We have dealt with this for quite some time, and we will continue to do so,” she says. “Our rate (of infection) has improved over the last couple of years due to our infection prevention program.”

While the hospital’s goal is to have zero infections, Gimbel says, “It’s almost impossible to be at zero, but it’s something we strive for every day. An area we can control is personal hygiene.”

A key element in preventing the spread of HAIs is to identify patients with an infection upon admission and take appropriate precautionary measures, Gimbel says. Every single patient found to have an infection was treated successfully, she adds.

Rigler says the problem is not as serious as it was some months ago because of infection prevention and control measures taken by health care facilities. Each hospital tracks its own data, but Arizona does not require public disclosure of infections that occur in health care facilities.

“We’re continually moving in the direction of preventing infections,” she says.

Early this year, ADHS established a new healthcare-associated infection advisory committee to follow up on recommendations of a legislatively created HAI panel in 2008. The original committee issued a report last December concluding that “strategies other than public reporting would be more successful in preventing healthcare-associated infections,” Rigler says. Four subcommittees, which Rigler calls the workhorses, focus on prevention strategies, surveillance, public education and provider education.

“The prevention strategies subcommittee is working to synthesize HAI prevention, gather the best practices and guidelines recommended from institutions nationally, and pull together a tool kit of information to help health care organizations decide on costs, how to implement programs, and how sustainable interventions are going to be,” Rigler says.

The surveillance panel is exploring how health care facilities are monitoring infections, what data they are collecting, and will then work closely with the National Healthcare Safety Network, which is run by the CDC.

Regarding the need for more transparency, Rigler says ADHS has an excellent relationship with its partners throughout the state. If ADHS notices an increase in infections, it contacts local health agencies, which then provide expertise and assistance.

“We have an obligation not to disclose certain pieces of information about one’s health condition,” Gimbel says. “It’s true that the public has a right to know, but one of the reasons health care facilities are reluctant is because of our responsibility toward patient privacy.”

To provide guidelines for other hospitals facing an outbreak of infections, Banner Baywood published an extensive article on its outbreak and plan of action in the March 2010 issue of AORN, a publication of the Association of periOperative Registered Nurses.

“We wanted to share our experience with the rest of the community,” Halowell says. “We included a timeline of what we did. They can use that as a check list if they have an outbreak. We’re proud of our infection prevent program and feel very good about our patients being safe when they come to Baywood.”

AzHHA’s 2010 Annual Membership Conference - AZ Business Magazine Sept/Oct 2010

AzHHA’s 2010 Annual Membership Conference Is Aimed At Helping Members Prepare For Change

With the health care field on the brink of a major upheaval, the Arizona Hospital and Healthcare Association’s (AzHHA) 2010 Annual Membership Conference offers members information on what to expect in the future.

The theme, Bringing the Future into Focus, incorporates a mix of topics and speakers intended to appeal to a diverse hospital audience. Attendees will hear from leading economists, patient safety experts, health care visionaries and others.

LeAnn Swanson, vice president of education services for AzHHA, says the conference is the ideal venue to bring the new health care reality into full focus.
“Some of the best minds in the industry will be providing hard-hitting education and thought-provoking commentary,” she says. “This conference is intended for the entire hospital family, including the C-suite leadership team, hospital trustees, legal counsel, operations, quality, patient safety, human resources, and marketing officers.”

This year’s conference, Oct. 14-15 at The Buttes Resort in Tempe, kicks off with a keynote session featuring Lowell Catlett, Ph.D., regent’s professor, dean and chief administrative officer at New Mexico State University’s College of Agricultural, Consumer and Environmental Sciences. He will speak on the present and future of the economy.

Catlett notes that economic downturns are common — with 14 recessions during the past 80 years — and provide a means for society to re-balance what it deems to be important.

“Every recession leads to a spurt in new business starts, reformulation of business practices and new technological adaptations,” he says. “This current pause is no exception as we focus on what we value most. Get ready for phenomenal growth in health care, energy and lifestyle markets. For those willing to embrace the opportunities, the next decade will be successful beyond any in history.”

Immediately after Catlett’s presentation on Oct. 14, the general session will feature Ron Galloway, director of the documentary “Why Wal-Mart Works and Why That Makes Some People Crazy,” and the newly released “Rebooting Healthcare.” His topic, Wal-Mart and the Future of Healthcare, covers in-store health care clinics that offer everything from eyeglasses to flu shots to urgent care.

Galloway says the discount retailer aims to leverage its 4,000 stores into the largest force in American health care.

At the Oct. 15 breakfast meeting, sponsored by the American College of Healthcare Executives (ACHE), Chris Van Gorder, president and CEO of Scripps Health in San Diego and ACHE 2010-2011 chairman, will offer a look at Scripps’ medical response team. Van Gorder will describe the team’s efforts in the Hurricane Katrina-ravaged Gulf of Mexico, San Diego after its massive wildfires and quake-stricken Haiti.

Concurrent breakout sessions will look at the key drivers of physician behavior and the natural tension that exists in doctor-hospital relationships; trends and technologies that are “re-forming” health care in unexpected and beneficial ways; and the notion of being in a health care bubble with a high potential for a correction over the next five years.

The closing session will feature John Nance, author of “Why Hospitals Should Fly,” which was named the 2009 book of the year by the ACHE. Based on his book, Nance offers some solutions to the patient safety and quality-care crises that resonate deeply with all health care audiences.

The conference also will feature AzHHA’s annual awards luncheon, and a president’s reception that will give attendees an opportunity to say goodbye to the organization’s longtime president and CEO, John Rivers, as he nears retirement. The reception also will serve to introduce AzHHA’s new leader, Laurie Liles.

Along with the conference, during the upcoming year AzHHA also will offer a series of webinars and other events of interest to members of the hospital and health care industry, as well as representatives of the business community, Swanson says. The emphasis will be on compliance-related topics, including rules and regulations of the Centers for Medicare and Medicaid Services, the Health Insurance Portability and Accountability Act (HIPAA), and the Federal Emergency Medical Treatment and Labor Act, also known as EMTALA.

To learn more about upcoming education opportunities from AzHHA and to register for conference events, visit www.azhha.org/educational_services and click on education events.

    Arizona Hospital and Healthcare Association’s
    2010 Annual Membership Conference

    Oct. 14-15
    The Buttes Resort
    2000 Westcourt Way, Tempe
    www.azhha.org

Arizona Business Magazine Sept/Oct 2010

State Budget Cuts Will Hit Arizona Hospitals - AZ Business Magazine Sept/Oct 2010

Despite Restoring Some Funds, State Budget Cuts Will Hit Arizona Hospitals

It was looking pretty grim at 1700 W. Washington St., as Gov. Jan Brewer and a badly splintered Arizona Legislature struggled to cobble together a state budget that would have the appearance of being balanced.

Taking a follow-the-money tactic, policymakers targeted programs such as education and health care that annually receive large sums of taxpayer dollars. The budget Brewer and Republican lawmakers put together, addressing a $3.2 billion shortfall for fiscal year 2011, sent shock waves throughout the health care community.

The Arizona Hospital and Healthcare Association (AzHHA) estimated the cuts would reduce hospital revenue by $1.15 billion in state and federal funds in FY 2011, which began July 1, and cost the overall health care community $2.7 billion. For example, the budget package eliminated coverage under the state’s Medicaid program — Arizona Health Care Cost Containment System (AHCCCS) — to 310,500 adults and children, and eliminated KidsCare, ending health care coverage for 47,000 children. KidsCare provides low-cost insurance for the children of parents who earn too much to qualify for Medicaid, but are still considered the so-called working poor.

Before the ink was dry on the bills the governor had signed, officials learned that the landmark health care reform bill passed by Congress prohibited such budget cuts under the threat of losing federal funds. So lawmakers passed another bill to restore money stripped from AHCCCS and KidsCare. Failure to have taken the follow-up action, officials said, could have cost Arizona more than $7 billion in federal money for health care.

AzHHA strongly supported the governor’s push for a temporary 1-cent sales tax increase, which voters approved by a 64 percent to 36 percent margin. The tax increase remains in effect until May 31, 2013, and is expected to generate about $3 billion over three years to protect education, public safety and health and human services from further cuts.

Despite avoiding a funding disaster, hospitals still are forced to deal with a considerable loss of government dollars. Laurie Liles, president and CEO of AzHHA, says hospitals sustained $50.1 million in cuts to the Disproportionate Share Hospital (DSH) program, which provides special funding to hospitals that treat a significant number of AHCCCS and uninsured patients. The state cut $16.7 million, resulting in a loss of $33.4 million in federal funds. The federal stimulus act of 2009 matches state dollars three-to-one for DSH, so when the state trims $1 from the program, the total loss is $4.

Hospitals also lost some $37.3 million in funding for graduate medical education, which helps pay for physician instruction programs.

“There is no funding for 2011,” Liles says. “That is a huge loss for Arizona, considering the significance of our physician shortage.”

In addition to those losses, the Legislature authorized AHCCCS to reduce all provider payments, including those to hospitals, by up to 5 percent for fiscal 2011.

“We don’t know what percentage cut that hospitals will receive,” Liles says. “Hospitals are planning on the full 5 percent, but we’re hoping it will be somewhat less.”

Since 2008, Arizona hospitals have sustained several hundred million dollars in payment cuts and freezes, which impact hospital employees — medical and non-medical, Liles says. The association has been monitoring how its member hospitals are dealing with the recession.

“We have found that hospitals are managing through a variety of ways,” Liles says, “with some staffing reductions, delays in capital construction and services to the community. Hospitals have had to make some very hard choices about services. Strategies that hospitals have been forced to employ affect all Arizonans.”

For example, Liles says, when hospitals are underpaid, either by AHCCCS or Medicare, hospitals shift those costs onto commercial health plans to make up the difference.

“We call that cost shift a hidden health care tax,” she says. “That results in higher premiums for businesses and families. We all end up paying for the cost shift that hospitals are forced to make.”

Liles, who previously was the chief lobbyist for AzHHA, says she spent a lot of time over the past few years visiting with legislators regarding the impact of the hidden health care tax.

In 2009, the Arizona Chamber Foundation, an affiliate of the Arizona Chamber of Commerce and Industry, determined that all purchasers of health care coverage pay 40 percent more for hospital care through commercial insurance as a result of underpayments from AHCCCS and Medicare, Liles says.

“We look for more of the same,” she says.

Hospitals are counting on Congress to continue funding AHCCCS at an increased level.

“We have shared our concern with our congressional delegation,” Liles says. “The enhanced federal medical assistance percentage is absolutely vital to Arizona.”

The increased funding amounts to about $480 million — money needed to cover the expanded AHCCCS population — that the state is mandated to continue covering as a result of national health care reform. Without additional federal funding, Liles wonders: “How are our Legislature and governor going to pay for that? We are concerned about the care we provide. There are only so many places our state can cut.”

By The Numbers: Health Care Cuts

  • $50.1 million in cuts to the Disproportionate Share Hospital (DSH) program
  • $37.3 million in funding for graduate medical education
  • AHCCCS can reduce all provider payments by up to 5 percent

Arizona Business Magazine Sept/Oct 2010

It appears the Chicago Cubs’ spring training facility will remain in Mesa - AZ Business Magazine Jul/Aug 2010

A Threat By The Cubs To Leave Arizona Has Cactus League Sites Scrambling

Update:
It appears the Chicago Cubs’ spring training facility will remain in Mesa. Team officials recently notified a group from Naples, Fla., attempting to lure the Cubs to the Grapefruit League that they plan to continue to negotiate exclusively with the city of Mesa. Mesa, meanwhile, reportedly is looking at four sites for the new facility: Recker Road and the Loop 202; the Riverview area; a downtown site; and near the Gaylord resort, planned for the GM Proving Grounds site. According to published reports, the Riverview area appears to be the leading contender for the facility.Spring training baseball in Arizona, a cash cow for Valley communities, is in need of another source of revenue to build new stadiums and refurbish existing facilities. The estimated 1.47 million fans who attended games played by the 15 teams that trained in Arizona this year contributed more than $300 million to the state’s economy, according to Cactus League Association estimates.

That’s the good news. The not-so-good news is that owners of the Chicago Cubs, the biggest draw in the Cactus League, have threatened to move their spring home from Mesa to Naples, Fla., if they don’t get a new stadium and training facility.

Adding to the financial dilemma is that funding from the Arizona Sports and Tourism Authority, which among other things supports spring training baseball, has virtually dried up, due in some measure to the economic downturn. The agency receives most of its money from tourism-related taxes on hotels and car rentals.

A legislative proposal to add a surcharge to all Cactus League tickets to help pay for a new Cubs stadium was as welcome as a blazing fastball from Randy Johnson in his prime. Efforts to push House Bill 2736, sponsored by House Majority Leader John McComish, basically struck out.

“We need to find ways to not only keep the Cubs in Maricopa County, but use those creative funding mechanisms to preserve and expand other spring training facilities in the entire West Valley,” says Jack Lunsford, president and CEO of WESTMARC. “Keeping the Cubs is important, as well as making sure a funding mechanism for the Cubs can be applied, as necessary, in the West Valley.”

Stepping to the plate, Peoria officials proposed a possible solution — the creation of special bonding districts. John Schell, intergovernmental affairs director for Peoria, explains his city’s interest.

“Without much discussion with the other teams or other affected entities, they (key legislators) added a surcharge to tickets and rental cars,” he says. “The ticket surcharge got us more involved because of the adverse impact it would have to our revenue-sharing agreement with the two teams that train in Peoria, the Seattle Mariners and the San Diego Padres. It was not feasible for us.”

The Peoria agreement, not unlike those of other Valley cities that host spring training teams, including Goodyear and Surprise, provides that if the state or some other entity puts a surcharge on tickets, Peoria would have to make up the difference.

“That would have cost us close to $300,000 a year to build a stadium in Mesa — with no ownership,” Schell says. “Imagine how the taxpayers in Peoria would have felt about that. So we were drawn into the discussion to try to identify some sort of funding solution.”

Schell notes correctly that the Arizona Legislature doesn’t have much of an appetite for new taxation, especially in the current economy. He and Peoria City Attorney Steve Kemp met with other host cities throughout the Valley and representatives of Major League Baseball to discuss options.

“It’s not a complete solution and it doesn’t involve any public funds,” Schell says. “We worked closely with the bond counsel for Major League Baseball and came up with a concept we called the revenue allocation authority.”

It was too late to be introduced at the Legislature this year, but Schell says there likely will be discussions on the topic even before lawmakers reconvene next January. It calls for the establishment of a district to issue bonds to pay for improvements or new construction of spring training facilities. Each district would have to be approved by voters living in the district and would not have taxing authority, Schell says.

“It’s a very strong tool,” Schell says. “It would use increment financing. It would capture the growth in the district. It would not become a general obligation of the city, and it won’t affect property taxes. People won’t feel the impact. It’s a unique way of financing.”

Schell says Major League Baseball, which helped prepare the proposal, is supportive.

Baseball insiders say they don’t think the Cubs will follow through with their threat and move to Florida. Although relocating to an Indian reservation, which is what the Arizona Diamondbacks and Colorado Rockies will do next spring, is an option, the Cubs have not expressed an outward interest in going that route. Others say if a deal with Mesa falls through, other Valley cities will make their pitch for the popular Chicago team.

Peoria Mayor Bob Barrett bluntly says the ticket surcharge proposal was a disaster and that he is adamantly opposed to such a scheme. On the possibility of the Cubs leaving Arizona, Barrett says he hopes they remain.

“They ought to talk to the tribes,” he says. “But, if they do leave, the world will continue to turn and the Cactus League will not disappear. The 14 other teams will survive.”

www.cactusleague.com | www.peoriaaz.com

Arizona Business Magazine Jul/Aug 2010

Luke’s Future In The West Valley Is Assured - AZ Business Magazine Jul/Aug 2010

Ready For Take Off: Luke’s Future In The West Valley Is Assured

Luke Air Force Base has landed the coveted mission of training pilots for the next generation F-35 fighter jets.

Luke was on the Defense Department’s short list, competing with Holloman Air Force Base in New Mexico, and Eglin Air Force Base in Florida, for the F-35. Actually, Luke was shooting for becoming a secondary site for the F-35s that exceed the number of jets already allotted to Eglin.

Luke, which annually pumps $2.17 billion into the Arizona economy, is considered recession-proof and a lifeline for the West Valley. It has been training U.S. fighter pilots since March 1941.

Yet, Luke’s unparalleled record of success — in preserving the nation’s security and enhancing Arizona’s economy — has faced challenges. Most recently, it weathered an encroachment issue that threatened its viability and its very existence.

Luke’s 8,000 active-duty personnel and their 6,700 family members are an important part of the West Valley, plus some 120,000 military retirees in the area who rely on various services provided at Luke. Their value to the area is not lost on Glendale Mayor Elaine Scruggs.

“We know many of them as residents, neighbors, volunteers and active members in our community, schools and churches,” she says. “Luke personnel and their families buy homes, cars and other big-tickets items, as well as shop in our stores and eat in our restaurants.”

F-35 JetIn stressing Luke’s importance to the West Valley, Scruggs adds, “The new F-35 mission will bring with it decades of sustainable economic benefits and an immediate infusion of $150 million in construction-related projects. In addition, the F-35 will generate additional employment, wages, consumer spending and investments that our region and state desperately need.”

Likewise, Peoria Mayor Bob Barrett recognizes the importance of Luke to the West Valley and the importance of the F-35 to Luke. Barrett and Scruggs were among several local elected officials who made trips to Washington, D.C. to plead Luke’s case with military officials.

Before the announcement that the F-35 training center had been awarded to Luke, Barrett was blunt about the base’s future without it.

“The Air Force doesn’t like me saying this,” Barrett says, “but I believe if we don’t acquire the F-35 for Luke Air Force Base, I believe they will close Luke. In five to eight years, the F-16 is gone. So, if we don’t have the F-35, Luke will follow. There is no reason to keep a base as large as Luke and maintain it if it doesn’t continue to be the world’s largest fighter training base — not just in the U.S., the world’s largest.”

Jack Lunsford, president and CEO of WESTMARC, says his organization strongly supports Luke and for several years has worked to preserve its mission. Lunsford sees Arizona Sen. John McCain, the ranking Republican on the Senate Armed Services Committee, as a key advocate for Luke and other military bases throughout the state.

On the issue of residential encroachment, Lunsford says, “We’ve been an advocate of protecting the base from encroachment for many years.”

James “Rusty” Mitchell, director of the Luke Community Initiatives Team, shies away from the term “encroachment.” Mitchell, who retired from the Air Force in 1998 as a lieutenant colonel, prefers “managed growth.” A representative of the Community Initiatives Team attends various city council meetings seeking win-win solutions.

“It’s more a process of managing development in the area so we can continue our flying mission and the cities can continue to be economically viable,” Mitchell says.

Under the terms of a 2004 Arizona law, and accepted earlier this year by the Maricopa County Board of Supervisors, local governmental entities are required to ensure adequate buffer zones around the state’s military bases.

Steve Yamamori, executive director/CEO of Fighter Country Partnership, a support group for programs and services at Luke, says the F-35 means “sustainability for Luke Air Force Base for the next 50 years — and that’s worth trillions of dollars.”

Arizona Business Magazine Jul/Aug 2010

AZ TechCelerator - AZ Business Magazine Jul/Aug 2010

Business Incubator AZ TechCelerator Works To Create Viable Companies In The West Valley

In an effort to boost its economy and shake its reputation as a bedroom community, the city of Surprise has launched AZ TechCelerator, a business incubator for budding entrepreneurs. The incubator offers well-below market rent, administrative support and access to experts who can help the entreprenuers “graduate” in three to five years, and thus bring their products and services to the marketplace.

The incubator comes in handy, especially in dire economic times. There are always entrepreneurs hoping to develop products or services. But in a slow economy, when people have been laid off and are unable to find gainful employment, Az TechCelerator gives those people an opportunity to test their ideas and innovations.

Of course, Surprise officials hope these startups will set up shop in their city once they emerge from AZ TechCelerator. A rule of thumb among business incubators is that 60 percent to 75 percent of these entrepreneurs do graduate, and about 75 percent of those will indeed remain in Surprise.

Jack Lunsford, president and CEO of WESTMARC, applauds Surprise’s effort.

“It’s an approach that our communities need to take as they seek and advance a knowledge-based economy,” he says. “I commend them for their innovation. We need more of these incubators. The high-paying jobs that come from spin-offs of these entrepreneurships is great.”

Mike Hoover, economic development coordinator for Surprise, gives the initial group of businesses high marks.

“They are exceeding our own expectations on quality and the amount of business going on in there, especially the anticipated growth and success of some of the businesses,” he says.

The AZ TechCelerator is located at 12425 W. Bell Road, in a four-building complex that formerly served as the Surprise City Hall. It totals nearly 60,000 square feet, which is four times the size of a typical incubator. Hoover says it can accommodate up to 15 businesses, depending on their size.

Three types of businesses are considered likely participants — those that deal in sustainability, such as solar technologies; life sciences and/or health care; and information technology.

One of the businesses in the incubator is MD 24, a medical service company that developed advanced software for home health care. It enables doctors to receive lab results, for example, while seeing patients in facilities that provide care for the elderly. Another company, Solar Jump AC, is developing more efficient cooling systems using solar thermal heat; and Athena Wireless Communications offers software for banking, telemedicine and other industries.

“These businesses are not yet commercially viable, needing assistance through a collegial supportive atmosphere that the city provides,” Hoover says.

In addition to offering space at a below-market rental rate, the city also provides an array of support services, including mail, copying and other administrative functions that each business needs.

The city’s most important service, Hoover says, is being able to link incubator businesses with various associations and support groups that can provide assistance with their specific needs.

“Whether they need help on putting together a marketing brochure, protecting intellectual property, or understanding how to put together a business plan for the company covering the next three to five years, they are able to get help,” Hoover says. “Anything that is identified inside of a strong and stable business, the city helps these businesses reach out to groups that can help them.”

Another way the city prepares businesses for graduation is by ratcheting up the low rents the longer the company remains in the incubator.

“It prepares them for the commercial world,” Hoover says. “There’s no sticker shock. At the end of their stay here, they are closer to commercial viability because they are paying closer to a commercial rent.”

Surprise started preparation work for the incubator in June 2009, began marketing it in September, and accepted its first tenants around the start of November.

One of the side benefits of the AZ TechCelerator is that it occupies the former City Hall complex that otherwise might have remained vacant. When the city moved to its new municipal facility at 8401 W. Monroe St., several hundred people left the old site on Bell Road.

“Restaurants and other businesses in the area were suffering,” Hoover says. “The choices were to leave that space dormant, or reprogram it into an economic engine. We turned a nonperforming asset into an economic starter.”

Surprise hopes to keep the expense of running the incubator as close to break-even as possible, supported by rent and common area fees, Hoover says.

“Our purpose is for business and job creation,” he says. “There are no retail projects inside. They are all some type of service or product development. They’re not competing with retail outlets on the outside.”

www.surpriseaz.com

Arizona Business Magazine Jul/Aug 2010

Greater Maricopa Foreign Trade Zone - AZ Business Magazine Jul/Aug 2010

The Greater Maricopa Foreign Trade Zone Opens Up Business Possibilities In The West Valley

At a time when the West Valley could use an economic boost, officials have put the finishing touches on the proposed Greater Maricopa Foreign Trade Zone. Under the administration of WESTMARC, an acronym for Western Maricopa Coalition, this new Foreign Trade Zone (FTZ) is seen as a welcome economic development tool that will spawn jobs and millions of dollars in new investment.

Participating cities are Avondale, Buckeye, El Mirage, Gila Bend, Goodyear, Peoria and Surprise. Initially, four sites in three of the cities have applied for FTZ status: two in Goodyear at Interstate 10 and Loop 303, one in Surprise near Bell Road, and one west of Buckeye in an unincorporated area. The Greater Maricopa Foreign Trade Zone is actually a series of trade zones, with each city acting independently but represented by WESTMARC.

Federal approval of WESTMARC’s application of the overall trade zone by the U.S. Department of Commerce and the Department of Homeland Security is expected before the end of the year. Launched in 1934, the federal Foreign Trade Zone program provides for reduced or eliminated federal taxes and fees in connection with imports and exports. For customs purposes, an FTZ is considered outside the United States.

Consultant Curtis Spencer, president of Houston-based IMS Worldwide, says there has been quite a bit of interest in West Valley sites from brokers looking for build-to-suit opportunities, particularly for solar and other manufacturers.

Spencer says developers generally pay the initial fee of about $50,000 to be in the FTZ depending on proposed use. Companies locating in an FTZ also pay an annual fee, but Spencer estimates the savings to a company can range from $300,000 to $1 million a year.

A typical business in an FTZ pays wages 7 percent to 8 percent more than a similar company not involved in exporting and importing, and employs 10 percent to 20 percent more workers, Spencer says.

“Foreign Trade Zone activities now exceed the statistical equivalent of imports and exports carried by truck into and out of Canada and Mexico,” Spencer says. “It’s a significant portion of our economy.”

A company in the West Valley area that decides to seek FTZ status puts in an application that will go through WESTMARC, which holds the federal permit, and on to the federal Foreign Trade Zone board. Zones are not limited to the four that have been selected. Likely candidate businesses for an FTZ range from high-tech manufacturers to distributors.

“It should give a major boost in investment and job creation,” Spencer says. “In the next 10 years we should have added hundreds of jobs and tens of millions of new investment.”

Basically, FTZs speed up the supply chain, reduce importing costs and provide better security, Spencer says.

“It’s faster, cheaper and better,” he adds.

Regarding security, companies that have been certified for FTZ status by federal authorities undergo extreme scrutiny, and therefore are not likely to be dealing with unfriendly countries or terrorist organizations. Concern over the importation of contraband has heightened since the attacks of 9/11.

Harry Paxton, economic development director for the city of Goodyear, says participating cities can use the FTZ as a marketing tool.

“It says that these communities are ready to accept businesses involved in international commerce,” he says.

Goodyear, which was among the first to express an interest in establishing an FTZ three years ago, hopes to fill some existing buildings by offering significant property tax breaks. Personal and real property taxes in an Arizona FTZ are cut by 75 percent.

But the perception that such tax reductions will have a negative impact on a city is incorrect, Paxton says. The assessed valuation of an activated FTZ reduces to 5 percent from 20 percent, but still generates additional revenue when compared to agricultural-use sites that collect $300 per 10 acres. What’s more, Paxton says, the FTZ becomes a catalyst for other development not requiring FTZ tax benefits, resulting in a full tax rate on those businesses.

“It’s a win-win,” he says. “It helps us become more competitive.”

Mitch Rosen, director of office and industrial development for SunCor Development Company, says his company owns 250 acres that will be part of the FTZ.

“The reason we’re interested is that we believe it to be an exceptional tool to stimulate the economic development of the West Valley,” he says. “It’s a good way to stimulate quality employment and it creates a competitive advantage for Arizona and the West Valley. It encourages businesses throughout the country to elect to locate in the West Valley.”

Jack Lunsford, president and CEO of WESTMARC, expects FTZs to spring up throughout the sprawling West Valley as cities become more aware of the benefits.

“We are thrilled,” he says, “to help bring this economic development tool to our West Valley communities that will assist them, especially at a time like this.”

www.imsw.com | www.suncoraz.com | www.ci.goodyear.az.us

Arizona Business Magazine Jul/Aug 2010

State’s Tough, New Immigration Law - AZ Business Magazine June 2010

Business Leaders are Concerned About the Repercussions the State’s Tough, New Immigration Law Will Have on Arizona’s Still Struggling Economy

Opponents of Arizona’s toughest-in-the-nation immigration law charge that it is unconstitutional and will lead to racial profiling, specifically targeting Hispanics. Supporters counter that the state statute corresponds with federal law and is designed to deal with those who break the law by entering the country illegally. Caught in the crossfire is Arizona’s fragile economy.

Regardless of where one falls on the SB 1070 debate, there is no doubt that it is having negative repercussions on the state’s economy. How severe those repercussions will be is unknown, and Valley and state business leaders are working hard to head off any further damage.

“It’s a negative and it’s not helping us,” said Barry Broome, president and CEO of the Greater Phoenix Economic Council.

The Phoenix City Council was told the city alone could lose up to $90 million in hotel and Phoenix Convention Center business over the next five years. At press time, city officials were monitoring at least 19 upcoming events, including some that already had pulled the plug on Phoenix, said Deputy City Manager Dave Kreitor.

Last month, Los Angeles became the largest city in the nation to prohibit its local government from doing business in Arizona unless the immigration law is repealed. There are estimates that the L.A. boycott could affect up to $8 million worth of contracts with Arizona. About two-dozen groups already have pulled events from Arizona, which tourism officials say has cost the tourism industry millions of dollars.

SB 1070
On April 23, Gov. Jan Brewer signed Senate Bill 1070 into law, making it a crime under state statute to be in the country illegally. Wording in the original law directed local police to question people they had made “lawful contact” with about their immigration status if there was reason to suspect they were illegal. Amendments to the law days after Brewer signed it included changing “lawful contact” to “lawful stop, detention or arrest”; and adding that officers cannot base their reasonable suspicion on race, color or national origin. The law goes into effect on July 29.

Although boycotts already have begun impacting the state’s tourism industry, Brewer said she has no intention of backing down. The state had to act, she said, because the federal government failed to secure the border with Mexico.

In a statement titled “Misguided Boycott,” Brewer said that when she signed the legislation, “I stated clearly I will not tolerate racial discrimination or racial profiling in Arizona.”

In response to a question about what Brewer can and will do to turn around the spread of boycotts and meeting cancellations, the Governor’s Office released this statement: “Governor Brewer will continue to aggressively oppose economic boycotts as a thoughtless effort that harms innocent families and businesses. Both proponents and adversaries of SB 1070 in Arizona have come out in staunch opposition to an economic boycott, including most recently Congresswoman (Ann) Kirkpatrick and the Tucson Hispanic Chamber of Commerce.”

Brewer went a step further in May when she announced the formation of a task force charged with rebranding the state as a tourist destination. Brewer said it was time to “get the truth out there” about the law.

Meanwhile, polls taken before and after the law’s passage show Arizonans’ support of the statute is fluctuating. A Rasmussen poll taken a week before the law was signed showed 70 percent of residents supported the measure. A survey taken a week after the law was signed showed support dropping to 52 percent. National polls have consistently shown strong support for the law.

“When you think of Arizona now, you think of this immigration law.  That’s not the first thing you want people to think of.” – Barry Boome, Greater Phoenix Economic Council

Threat to tourism
Debbie Johnson, president and CEO of the Arizona Hotel & Lodging Association, released a statement saying the tourism industry is “deeply concerned about the repercussions that will result from the debate around Senate Bill 1070.”

The statement from Johnson, who also leads the Valley Hotel & Resort Association and the Arizona Tourism Alliance, continued: “Arizona tourism is currently in a very fragile state of recovery and the negative perceptions surrounding this legislation are tarnishing Arizona’s image and could easily have a devastating effect on visitation to our state.”

Any loss of business negatively impacts the tourism industry and “directly affects the paychecks and health benefits of our most vulnerable tourism employees as well as their families,” Johnson added. She also stated that the tourism industry provides 200,000 jobs and $1.4 billion in tax revenues to state, city and county budgets.

Kristen Jarnagin, communications director for the Arizona Hotel & Lodging Association, said that as of the first week of May, 23 groups had cancelled meetings in Arizona, resulting in a loss of up to $10 million.

One group that pulled out is the American Immigration Lawyers Association, which canceled a fall conference in Scottsdale. Another is the African-American Alpha Phi Alpha Fraternity Inc., which was supposed to hold its convention in Downtown Phoenix in July, bringing an estimated 5,000 attendees and as many as 10,000 visitors. Instead, it’s going to Las Vegas.

Corporate impact
Some Arizona companies also are feeling the sting generated by the controversy. Some opponents of the law are urging people not to fly Tempe-based US Airways or to rent trucks from Phoenix-based U-Haul.

Even the state’s professional sports teams have been affected. Pickets urging a boycott of Arizona took place outside of Wrigley Field in Chicago when the Arizona Diamondbacks were playing the Cubs there. In addition, Sen. Charles Schumer (D-NY), has called on Major League Baseball to pull the scheduled 2011 All-Star game out of Phoenix.

Derrick Hall, president and CEO of the Diamondbacks, said he was concerned, but noted that planning for the game has advanced to the point where “it would be difficult to back off … for 2011.” MLB Commissioner Bud Selig has been ignoring the boycott calls.

Phoenix Suns Managing Partner Robert Sarver stepped into the middle of the debate in May, by announcing that the team would wear its “Los Suns” jerseys in recognition of playing on Cinco de Mayo. Then he added that “frustration with the federal government’s failure to deal with the issue of illegal immigration resulted in passage of a flawed state law.”

But has the federal government’s failure to secure the border with Mexico cost Arizona business? Some of the state’s top economic development experts say no. Shortly after the law was signed, Broome of GPEC said he had never heard of any businesses that were considering relocating to Arizona expressing concerns about the state’s porous border with Mexico.

“In our discussions with companies looking to move to Arizona, we want to begin and end with good things — the emergence of (Arizona State University), quality of life and a talented work force,” Broome said. “The biggest hardship is on the brand. When you think of Arizona now, you think of this immigration law. That’s not the first thing you want people to think of.”

David Drennon, director of communications for the Arizona Department of Commerce, agreed with Broome that the flow of illegals across the border has been a non-factor in business relocation decisions.

“Actually, the proximity to Mexico is advantageous, giving businesses access to markets in Mexico and even South America,” Drennon said
As Arizona’s No. 1 trading partner, Mexico imported $4.5 billion worth of Arizona products such as semiconductor chips, machinery and plastics in 2009, according to the Arizona Department of Commerce.

What needs to happen next, Broome said, is for business and government leaders to clearly communicate the law’s intention.

“This law was signed without a clear understanding of how we are going to get involved in a communications strategy,” he said. “People need to understand that this is a law that mirrors federal law. That’s been lost.”

While the experts say the illegal flow of immigrants into Arizona has not chased away relocating companies, the storm over the new law is causing some out-of-state corporate anxiety.

Laura Shaw, senior vice president of marketing and communications at Tucson Regional Economic Opportunities (TREO), noted that officials with two major relocation prospects for the Tucson area say they are concerned about the uproar the immigration law has sparked.

“But they haven’t said no,” Shaw quickly added. The two prospects are in aerospace and bioscience, and would provide hundreds of jobs.

“Businesses looking to relocate or expand don’t like controversy,” she said.

Politicians, pundits and stars
It was precisely controversy that attracted high-profile celebrities to Arizona, including civil rights leader the Rev. Al Sharpton, actor Danny Glover and Colombian singer Shakira. And, in protest, comedian George Lopez canceled an appearance at an Indian casino just south of Phoenix.

As the Arizona bill was making its way through the capitol, the state’s two U.S. senators, John McCain and Jon Kyl, announced a 10-point border security plan. Among other things, it calls for deploying 3,000 National Guard troops along the Arizona-Mexico border and permanently adding 3,000 more Custom and Border Protection agents in the state.

McCain, who came out in support of the immigration law, said the current wave of protests and what happened after Arizona voters rejected a paid Martin Luther King Jr. holiday in 1990 are completely different.

“One was about honoring a civil rights hero who a majority of Americans held in extremely high esteem,” he said. “The other is about an issue of national security and the security of our citizens, where we have broken borders and are literally overwhelmed with both human smuggling and drugs.”
After the King vote, which was reversed in another election two years later, the NFL pulled the 1993 Super Bowl from Arizona. Estimates of lost convention business in the Phoenix area alone topped $190 million.

J.D. Hayworth, a former U.S. congressman and McCain’s opponent in this year’s hotly contested GOP primary, had urged Brewer to sign the law. In 2005, while still in Congress, Hayworth introduced the Enforcement First Act, which focused on border security. The bill did not pass. Hayworth’s press secretary, Mark Sanders, said the former congressman is continuing his efforts to seal the border.

“That’s where we start,” Sanders said. “And no amnesty. No reward for illegal behavior.”

U.S. Rep. Raul Grijalva, a Democrat who represents Southern Arizona’s 7th Congressional District, created an uproar of his own when he called for a boycott of a large chunk of the state’s tourism industry.

In a statement made a few days after the law was passed, Grijalva said, “This is a specifically targeted call for action, not a blanket rejection of the state economy … we are calling on businesses and organizations not to bring their conventions to Arizona until it recognizes civil rights and the meaning of due process. We don’t want to sustain this effort any longer than necessary. It’s about sending a message.”

Boycotting boycotts
James E. Garcia, director of communications for the Arizona Hispanic Chamber of Commerce, said his organization does not support the boycotts, but it is concerned about civil rights issues.

“We believe passage of this bill sends a message to the country and world that Arizona is somehow under siege by immigrants,” Garcia said. “That kind of message tells people: don’t start a business in Arizona and don’t be a tourist here.”

David Roderique of the Downtown Phoenix Partnership said the organization had arranged to have several individuals ask Brewer to veto the bill, fearing an economic backlash. After the law was signed, partnership representatives were involved in pitching Phoenix to the Democratic National Committee as the host city for the 2012 Democratic National Convention.

“The likelihood of the Democrats coming here now is zero,” Roderique said. “We have a definite concern that this will create a significant economic impact when we can least afford to have another major disruption.”

In May, the Republican National Committee bypassed Phoenix as the host of the 2012 Republican National Convention. AZGOP Chairman Randy Pullen immediately issued a statement saying that many would cite the new immigration law “as one of the reasons that Phoenix was not chosen (and) nothing could be further from the truth. Members of the RNC overwhelmingly support the immigration bill signed … and Republicans from coast-to-coast stand with Arizonans as we fight to secure our border.”

To that end, Roderique noted that if several other states pass similar laws, some of the spotlight might be shifted away from Arizona.

“If we’re not the lone wolf out there and other states are doing this, the feds are going to have to act,” he said. “It should not lie in individual states or individual municipalities to try to enforce immigration laws. We need a comprehensive federal reform package.”

At the Greater Phoenix Convention & Visitors Bureau, Doug MacKenzie, director of communications, said it was “misguided to bring the tourism industry into the crosshairs of this political issue.”

The CVB, which is trying to dissuade groups from considering boycotts, stated that “we may never know the full impact that all the publicity surrounding the passage” of SB 1070 will have on decisions by visitors and organizations choosing convention sites.

Michael Stawiarski, president of the Arizona Sunbelt Chapter of Meeting Professionals International, released a statement from the organization’s national president, Bruce MacMillan, blasting the boycotts: “Using travel boycotts as a political weapon in Arizona (or anywhere) only hurts the local communities and the 200,000 workers in the state that benefit from the meeting and event industry.”

gpec.org | azhla.com | aila.org | azcommerce.com | treoaz.org | azhcc.com | visitphoenix.com | tucsonchamber.org

Arizona Business Magazine June 2010

Good Samaritan Hospital at sunset

Massive Budget Cuts Have Arizona’s Hospitals And Health Care Industry Closing Ranks

As bad as 2009 was, the health care industry in Arizona is still bracing for the worst. So says John R. Rivers, president and chief executive officer of the Arizona Hospital and Healthcare Association (AzHHA), whose organization, along with others, lobbied unsuccessfully against massive legislative reductions totaling $2.7 billion to the Arizona Health Care Cost Containment System (AHCCCS) and Arizona Department of Health Services’ budgets for fiscal 2011.

The cuts were part of an effort by the Legislature to dig the state out of the deficit hole it finds itself in.

“I can’t predict who is going to do what in response to these cutbacks, but I can tell you that every person in Arizona will be affected by these cuts in some negative manner — either though higher insurance premiums, more overcrowding in hospital emergency rooms, reduced services provided by hospitals or even some hospital closures,” Rivers says. “The impact of these cuts will be far-reaching and long-lasting.”

Hospitals alone stand to lose $1.15 billion in the fiscal year that starts July 1.

“Our focus and energies must be on the daunting challenge of dealing with the negative impact on patient care as a result of the budget cuts recently enacted in Arizona,” says Peter Fine, president and CEO of Banner Health. “These cuts will result in reductions of $2.7 billion in health care spending, including scheduled cuts of more than $1 billion to Arizona hospitals in 2011. This will place tremendous pressure on the state’s hospitals.”

The AzHHA position is that the budget cuts not only will devastate Arizona’s health care community, but also cripple the state’s economy. Arizona’s hospital community employs approximately 73,000 people and contributes $11.5 billion to the state’s gross product. In a recent report, the Seidman Research Institute at the W.P. Carey School of Business at Arizona State University estimated the budget cuts would result in a loss of 42,000 jobs across virtually every segment of the Arizona economy.

Those job losses, Rivers says, “will worsen Arizona’s economic downturn and flies in the face of legislators’ efforts to create new jobs and revitalize the state’s business climate.”

The health care sector would suffer the greatest loss of jobs, totaling an estimated 19,600 in 2011. Employment losses also would hit such categories as arts and entertainment, construction, finance, manufacturing, mining, real estate, retail, transportation and warehousing, according to the ASU report.

Other startling numbers from the report indicate that real disposable income would be reduced by $1.74 billion — approximately $200 per capita — and the state’s population would shrink by 10,000.

Even before the Legislature took final action, St. Joseph’s Hospital & Medical Center already was dealing with the state’s budget implosion.

“Because we are the largest hospital in Arizona, and treat more AHCCCS patients than any other private hospital, these cuts have been devastating to us,” says Linda Hunt, service area president of Catholic Healthcare West (CHW) Arizona and president of St. Joseph’s. “The Legislature cut more than $14 million in funding to our hospital alone between mid-December and February. Part of these cuts wiped out funding for our graduate medical education program, which trains more than 200 medical residents in 10 different clinical specialties. We now have to make up the deficit. In addition, our charity care costs continue to increase, we are seeing more uninsured patients in our ER, and we are seeing more mentally ill patients in the ER because they have nowhere else to get help.”

Hunt’s concern for the most vulnerable members of society is echoed by Betsey Bayless, president and CEO of Maricopa Integrated Health System (MIHS), which operates the Maricopa Medical Center.

“About 65 percent of our patients are on AHCCCS, and we operate the Valley’s largest psychiatric inpatient hospital, Desert Vista, in Mesa,” Bayless says. “Furthermore, patients without coverage will seek care only when their conditions worsen, thus driving up emergency room demand — the most costly means of caring for illness and disease.”

Further putting a human face on the budget cuts, health care coverage is being eliminated for 310,500 low-income adults and 47,000 children, and mental health treatment ends for 36,500 adults and children.

Hospital officials fear their emergency rooms will be inundated by additional waves of the uninsured. Emergency rooms are federally mandated to screen and stabilize all patients, without regard to their ability to pay for care. In 2008, Arizona hospitals provided approximately $392 million in uncompensated care to uninsured patients. Hospitals make up the loss by absorbing or shifting costs to commercial health plans, which then charge businesses and individuals higher health insurance premiums, AzHHA maintains. The cost-shift, coupled with further cuts in AHCCCS hospital payment rates, amounts to a hidden tax on health care consumers, according to AzHHA.

The budget cuts also eliminate the KidsCare Program, which provides medical services and preventive health care for children of families who cannot afford insurance. Ending the program saves the state $22.9 million, but costs the state $95.5 million in federal matching funds, for a total loss of $119 million to the state’s health care system. Hospitals will lose $44 million in revenue, AzHHA says.

Of extreme concern to the medical community is a measure on the November ballot that targets Proposition 204, which was approved by voters in 2000. Prop. 204 expanded eligibility for AHCCCS, but the new ballot measure asks voters to deny eligibility to an estimated 315,000 individuals who benefited from the 2000 proposition. Under the ballot proposal this year, the state would save $765 million, but would lose $1.5 billion in federal matching funds, for a total reduction of $2.3 billion to the Arizona health care community. Hospitals alone would lose an estimated $851 million in revenue.

To cope with reduced funding, MIHS has limited new hires and is formulating plans to address these unprecedented budget cuts.

“Moreover,” Bayless says, “we recognize this is not our problem alone. Rather this is a community-wide issue, and I have been reaching out to other health care leaders about ways we can work together to best care for our Valley residents.”

Hunt says St. Joseph’s employees have provided dozens of ideas on how the hospital can operate more efficiently, while preserving patient safety and quality care.

“We are looking at a wide variety of community, academic and business partnerships, and are re-evaluating our strategic plan to add more focus on the service lines that are most needed in the region,” Hunt says. “We are a ‘destination hospital’ for many complex illnesses and will continue to bring patients in from around the country and around the world. We will also advocate strongly for the state to provide services for the most needy and encourage our leaders to see health care as a vital contributor to the state’s economic recovery.”

As for its next step, Rivers says AzHHA will work to guard the funds that escaped the budget axe.

“We will develop a proposal that protects these health care programs either through new revenue sources or requiring that existing revenue sources earmarked for these programs are used for their intended purposes — not just dropped into a black hole in the general fund,” he says.

Woman in medical clothing sitting at a laptop

AzHHA Expands Its Online Job Board To Encompass The Full Spectrum Of Health Care Jobs

At a time when economic news is dominated by downsizing and layoffs, the Arizona Hospital and Healthcare Association (AzHHA) is expanding its efforts to recruit new employees for positions ranging from janitor to physician.

Although the state’s unemployment rate hovers at just under 10 percent, Arizona health care facilities added 1,700 jobs in January alone. To meet that continuing need, the association launched an enhanced interactive Internet job board — www.AzHealthjobs.com — that reaches from coast to coast.

Originally launched about 10 years ago, the Web site was created by AzHHA to enable member hospitals to post open positions, much like Monster.com and Jobing.com, but was targeted strictly to hospital positions. Now, with an expanded scope that was launched on Feb. 1, the Web site is open to all segments of the health care industry, including nursing homes and doctor’s offices.

What’s more, posted jobs don’t necessarily have to be in the medical field. For example, CPAs and others who want to work in health care facilities are encouraged to post their resumes.

“The more that we get the word out for our enhanced Web site, the more jobs will be available,” says Patricia Weidman, director of work force and staffing services for AzHHA and who oversees the job board. “This is how we’re helping people who are looking for jobs. A lot of people don’t know about it, because previously it was limited to hospitals. We have marketed the Web site at conventions. We tell people to check it out. Hospitals use engineers, CPAs, janitorial, housekeeping, laundry positions. A lot of non-clinical positions are listed.”

Health care used to be considered recession proof, but that changed somewhat during this past brutal downturn. Weidman says the expanded job board can help make the hiring process more cost efficient for health care providers.

“We’re very excited about the enhancements of AzHealthjobs.com,” she says, “because we know how critical it is for employers in the health care industry to attract first-rate talent with a minimum expenditure of time and resources. And it’s important for us to help enable smooth career transitions for those seeking health industry jobs.”

Weidman says the job board has been a valuable tool for Arizona hospitals, which currently employ 73,000 people and generate $11.5 billion to Arizona’s gross state product.

Job seekers pay nothing to post their resumes on AzHHA’s Web site, but fees are paid by employers with positions to fill. Positions can be posted for 30 days for a fee of $350. At any given time, hospitals and other employers list 1,000 to 1,500 jobs, with direct links to individual career sites, Weidman says.

As part of the expansion, AzHHA joined the National HealthCare Career Network (NHCN). The NHCN partnership brings together the best sources of highly qualified talent from leading professional and trade associations representing skills in all sectors of health care.

AzHHA also is partnering with Boxwood Technology, a leading provider of career center services for the association industry. Boxwood, which administers and manages AzHHA’s jobs site, is the only such provider endorsed by the American Society of Association Executives. Boxwood also provides technical support, customer service, accounting, content management and ongoing product development. Weidman says Boxwood has a network of more than 185 leading health care associations and professional organizations.

Any money generated from the Web site goes back to the nonprofit side of AzHHA and helps keep dues down, Weidman says.

“So hospitals are benefiting, even though we are opening the Web site up,” she adds. “Some hospitals had expressed concern, but we were able to reassure them.”

It’s still too early to tell how effective the newly expanded Web site will be, Weidman says. It will take time to get the word out, which she does on a monthly basis at nursing conventions and job fairs around the country.

“I tell everyone to get their resumes on there if they’re looking for a health care position in Arizona,” Weidman says. “This is the place to be.”

Especially for nurses. In the past, some nurses Weidman met at conventions would say they didn’t want to work in a hospital, but preferred something else, such as a nursing home. For a nurse, working in a hospital is not the same as in a nursing home, school, doctor’s office or prison. Different skills are required, and the pace is much quicker, for example, in emergency rooms and intensive care units. With the expanded Web site, nurses looking for a position can zero in on specific career opportunities.

And despite the sorry state of the economy, hospitals, not as hard hit as other industries, are still hiring nurses.

“Hospitals have been using a lot of temporary staff, some nurses are taking additional shifts, and some part-timers are going full-time to fill any shortages,” Weidman says. “We wouldn’t have this program if they weren’t still hiring.”

A recent survey indicates that one-third of the RNs in Arizona are 55 or older.

“When they retire, we still will have a nursing shortage,” Weidman says. “We’re telling hospitals that this is a perfect time to build their own resume database, so when those positions do come up, they can tap into that database and be ready to go when they have the need.”

GPEC Profile: Candace Wiest, President And CEO Of West Valley National Bank

Candace Wiest
President and CEO, West Valley National Bank

Even before West Valley National Bank opened its doors on Dec. 23, 2006, a decision was made to join the Greater Phoenix Economic Council. Becoming an active member of GPEC made good business sense.

“What I like about GPEC is its economic development focus,” says Candace Wiest, president and CEO of the community bank. “It goes to the heart of what community banks do. I’m a firm believer in the saying that a rising tide lifts all ships.”

One of the first benefits Wiest saw for her bank was how GPEC helped attract the Cancer Treatment Centers of America to the West Valley. The nation’s fourth Cancer Treatment Centers of America, located in Goodyear, opened on Dec. 29, 2008, bringing with it quality care for cancer patients and 200 high-paying jobs. But there’s more.

“It certainly helped with some of the housing issues in the West Valley, created a lot of options in terms of health care, and gave the area national recognition,” Wiest says. “I couldn’t bank the hospital itself, maybe, but I certainly can be the banker for a lot of the people out there.”

GPEC efforts benefit the Greater Phoenix’s economy on a macro level, Wiest says, as well as on a micro level helping its individual members.

She enjoys serving on GPEC Next, which is an advisory group through which some of the newer ideas flow before being submitted to GPEC’s board of directors. She applauds GPEC’s role in supporting solar energy, which produces a benefit for her bank.

“I certainly cannot finance any big solar companies,” Wiest says, “but we have launched a program to finance construction for businesses that want to convert to solar.”

The solid relationship between West Valley National Bank and GPEC is ongoing. Wiest is on the board of the Cancer Treatment Centers of America, maintaining a link between the cancer facility and GPEC; and she is a trustee of New Hampshire’s Franklin Pierce University, named after the 14th U.S. president. The university already holds some classes in Goodyear and is considering an expansion, Wiest says, adding that GPEC is playing a role in that project.

Wiest says GPEC has done wonders to enhance the Valley’s image. While serving a pair of three-year terms as a director of the Federal Reserve Bank of San Francisco, she heard numerous negative comments about the Phoenix area.

“GPEC has helped to debunk some of those myths,” Wiest says.

www.wvnb.net


Arizona Business Magazine

February 2010

GPEC Profile: Mike Tully, President And CEO Of AAA Arizona

Mike Tully
President and CEO, AAA Arizona

As president and CEO of AAA Arizona, Mike Tully has a keen interest in getting the state back on the road to prosperity. That probably explains why for the past seven years Tully, who joined AAA Arizona in 1998 as chief financial officer, has been a member of the Greater Phoenix Economic Council’s Finance Committee.

“GPEC’s role in our community is critical,” Tully says. “Attracting high-quality jobs to our state improves our health and economic performance, and makes the state a more attractive place for residents, as well as people moving to our beautiful state. As a membership organization representing nearly 800,000 people, AAA has a vested interest in the livelihood of Arizona.”

In addition to Tully’s position on the Finance Committee, AAA Arizona has a representative on the GPEC board of directors. That’s just part of the relationship.

“From a business perspective, we have used GPEC as a resource when we evaluated expansion opportunities, moving a large portion of our California operations to Arizona,” Tully says. “GPEC was invaluable in our ultimate decision, which resulted in nearly 800 new jobs being brought to our state.”
GPEC’s mission to create a competitive, vibrant, diverse and self-sustaining regional economy is critical to all of Arizona’s industries, Tully says.

“Ensuring that Arizona continues to improve the diversity of high-paying quality jobs is more obvious than ever, as seen by our recent recession,” he says. “Our precipitous decline as the No. 1 job growth state to No. 50 is symptomatic of our lack of industry diversity.”

Tully has been instrumental in driving the tremendous growth of AAA over the past decade, including expansion of its membership, financial services, insurance and travel operations. Prior to joining AAA, Tully owned an export finance company that arranged structured trade finance transactions for exporters throughout the United States.

The AAA executive has deep Arizona roots, having earned his Bachelor of Science degree in finance in 1987, and a master’s in business administration in 1991, both from Arizona State University. In 2007, he graduated from the advanced management program at Harvard Business School. Tully also holds a CPA certification.

As for travel trends in Arizona, Tully says the future remains murky.

“Our short-term forecast is flat, although shorter trips and drive trips continue to be popular,” he says. “While business travel is picking up in many areas of the country, it has yet to rebound in the Southwest.”

Likewise, international travel to Arizona continues to be weak, which hurts even more because international travelers generally spend four to five times the amount of money as domestic visitors.

www.aaaaz.com

Arizona Business Magazine

February 2010

GPEC Profile: Craig Robb, Executive Vice President And Director Of Finance And Administration, National Bank Of Arizona

Craig Robb
Executive vice president and director of finance and administration, National Bank of Arizona

With a 17-year career in land development prior to joining National Bank of Arizona seven years ago, Craig Robb was a natural to become an active member of the Greater Phoenix Economic Council.

Robb, executive vice president and director of finance and administration for the bank, is in his first year on the GPEC board of directors. He also serves on the GPEC Next Committee, which reviews possible projects and initiatives before forwarding them to the board.

But it was his two-plus years on GPEC’s Community Development Committee that enabled him to draw extensively from his combined experience in real estate and banking. Comprised primarily of real estate brokers and developers, with some bankers, the panel focused on shovel-ready projects as the construction industry’s fortunes plunged.

One of the areas his committee worked on involves sustainability and LEED certification.

“GPEC maintains a strong effort to identify programs and buildings that are more attractive to potential companies coming into the Phoenix area,” Robb says. “It’s an effort to match companies to a building that is LEED certified and sustainable, whether it’s office or industrial. That’s very attractive to a company that might be interested in relocating here.”

The bank’s relationship with GPEC is a two-way street.

“We are glad to be a contributor to GPEC, which is absolutely the right organization for promoting Greater Phoenix,” Robb says, “especially how difficult it is now, with the competition we face in a national and global economy. On a reciprocal basis, we have benefited. GPEC has given us a greater interest in sustainability.”

The bank, which celebrated its 25th anniversary in 2009, decided to upgrade some of its nearly 80 branches that were facing energy challenges.

“We started our own effort to see what we could do to create a more sustainable platform for our own buildings,” Robb says.

About the same time in late 2008, Robb, through a GPEC event, met the CEO of Solar City.

“That blossomed forward, and we ended up with a $1.5 million installation at our Biltmore location, improving our energy efficiency,” he says. “In addition, the bank has committed $25 million to provide a lease program that allows individuals to lease solar equipment for their homes.

“We made our contribution to GPEC, and as a result here is a relationship that has blossomed into well over a $50 million investment related to solar.”

www.nbarizona.com


Arizona Business Magazine

February 2010

GPEC Profile: Steve Cowman, CEO Of Stirling Energy Systems Inc.

Steve Cowman
CEO, Stirling Energy Systems Inc. (SES)

With more than a hint of an Irish brogue, Steve Cowman sounds like he has found a home in what he calls the solar capital of the Southwest.

The CEO of Stirling Energy Systems Inc. (SES) is enthused about the prospects for an expanding solar energy industry, the strategic access to his market that Phoenix provides, and the proactive reputation of the Greater Phoenix Economic Council. SES is a pioneer in the design and development of Concentrated Solar Power solutions.

Cowman joined the company in May 2008, after having worked for General Electric for 10 years, including eight in the United States. He’s been living in the U.S., mostly on the East Coast, for 12 of the past 20 years.

Barely a year after taking the helm of Stirling, and choosing Phoenix for its corporate headquarters, Cowman joined GPEC and sits on the economic development organization’s executive committee. Though a relative newcomer to the Valley, Cowman, who has a background in semiconductor engineering, had a longtime involvement with Intel, Motorola and Arizona State University.

With Stirling targeting markets in Nevada, New Mexico, California, Texas, and of course, Arizona, Cowman says of Phoenix, “I liked the location and the infrastructure.”

While Cowman was working in Dublin, GPEC dispatched a representative to his company to reinforce the story about what Phoenix offers.

“I was impressed with the people and with the vision they have to reverse the trend of losing engineering and manufacturing-intensive businesses in the Valley,” Cowman says. “I like GPEC, and I want to stay here and grow here.”

Cowman applauds the efforts of GPEC to attract more solar energy businesses.

“A number of companies are looking to relocate their design or manufacturing operations to the Phoenix area,” he says. “The larger solar infrastructure we build in the Valley, the better it is for companies like Stirling. It improves the gene pool we can all draw from and helps with collaborative programs.”
In addition to marketing and promoting the Phoenix area from coast to coast, GPEC also gets into what Cowan refers to the “hard stuff,” pushing legislation that helps the solar industry.

On the lost manufacturing jobs, Cowman says, “These jobs are not going overseas. A lot of them are going to places like Nevada and New Mexico.
Arizona has some catching up to do, and GPEC is doing that. GPEC is trying to make the Valley look more attractive, and state officials need to wake up to the reality that we have a competitive disadvantage.”

www.stirlingenergy.com

Arizona Business Magazine

February 2010

GPEC Launches A New Website To Promote The Greater Phoenix Story

At a time when traditional newspapers are struggling or even vanishing, the Greater Phoenix Economic Council has launched a new Web site designed to provide information that offers a complete picture of what is going on in the Valley.

One of the goals behind the formation of OGP — opportunitygreaterphoenix.com — is to offset some of the negative news coverage that continues to plague Arizona. Barry Broome, GPEC president and CEO, says community leaders agreed on the concept of establishing a communications initiative that focuses on the brand of the Greater Phoenix market.

“We’re more transactional,” Broome says. “A lot of great attributes about our market don’t necessarily get conveyed in a transactional exchange. Our reputation is tied to a lot of things that go well beyond building work force availability and the cost of a transaction.”

Working with the Maricopa Partnership of Art, the Greater Phoenix Chamber of Commerce, and the Phoenix Convention & Visitors Bureau, GPEC maintains the Web site that enables people in Arizona and elsewhere to read stories about Arizona they might not see anywhere else.

“You can find the kind of in-depth stories not necessarily always available in a typical news environment,” Broome says. “Hopefully, it will become a social media phenomenon. Our goal is to complement blog activity and news activity in the market, and really tell our story. It’s more of a communications initiative than a Web site.”

Events of the past two years spurred the creation of Opportunity Greater Phoenix. There was concern that mainstream media were not defining Greater Phoenix in a fair and equitable way. Those events Broome mentions include the immigration debate, the housing market collapse, the impact on Arizona from the banking crisis and issues related to a state budget bleeding red ink.

GPEC Chairman Michael Bidwill and Vice Chair William Pepicello obtained funds from the private sector to launch the site. A Web publisher and a part-time reporter were brought onboard. Discussions about OGP began Oct. 1. Eight weeks later, the site was up and running.

The OGP site is designed to inform and influence the conversation about all things related to business, employment, and the economy in Greater Phoenix. It provides accurate coverage of news, trends and analysis relevant to the local economy, along with resources such as database searches, lists, links and summaries on work force, quality of life, and overall competitiveness. It will be particularly helpful, Broome says, when GPEC embarks on economic development trips to New York City and Washington, D.C. Interested parties can go to a single site and get a broad base of stories about the Greater Phoenix market, he says.

Commenting on the emergence of blogs, Broome says, “There’s not a lot of peer review to a blog. As communications becomes more organic and viral, we think it’s important that the market has an organic and viral communication device that will allow readers who are intrigued about our market an intense reading and learning experience.”

So where and how will the site get its information?

“We will be reconstituting information from mainstream media, and producing a lot of fresh new stories of our own,” Broome says. “We expect to write at least five new major stories a week. We’ll have features on CEOs, a community news site, profiles on individuals, and there may be an interactive opportunity to interface with an expert on the economy. The content will be fresh and compelling, but it won’t all be originally generated.”

As an example, Broome notes that Nobel Prize winner Lee Hartwell left the Fred Hutchinson Cancer Research Center in Seattle, where he was executive director, to establish and co-direct the Center for Sustainable Health at Arizona State University’s Biodesign Institute.

“That’s a big deal,” Broome says. “There’s a lot more to that story. What will be the focus of his research? It’s important to the region’s reputation that the story gets told in a more comprehensive and robust way.”

Another example of a story waiting to be told involves a dynamic young woman who graduated from ASU and launched a wireless company in Chandler.She might not be a candidate for a major news story by a major news outlet, but she’s young, which addresses the notion that Greater Phoenix is a retirement community, and she’s talented, which more accurately describes ASU as a first-class institution and not a party school, Broome says.

“That story won’t be in the New York Times,” he adds. “They write about our housing troubles. And The Washington Post writes about our budget problems.”

Opportunity Greater Phoenix is more than a news source. OGP is a resource, Broome says.

“Businesses looking to relocate or expand into Greater Phoenix will find information about the work force, quality of life, policies and legislation that impact decisions,” he says. “And those looking to visit or live in the Valley will find useful information on employment, neighborhoods and arts and culture.”

opportunitygreaterphoenix.com


Arizona Business Magazine

February 2010

The Valley’s Health Care Industry Held Its Own During The Recession And Looks Toward Expansion In The Recovery

In an economic downturn that has plunged Arizona into its worst financial crisis in decades, one sector of the state’s economy that remains vibrant and growing is the health care industry. Consider recent developments driven primarily by population growth: the Creighton University partnership with St. Joseph’s Hospital and Medical Center; the newly opened Cardon Children’s Medical Center, a Banner Health facility in Mesa; the M.D. Anderson Cancer Center scheduled to open in Gilbert in late 2011; and a major expansion of Phoenix Children’s Hospital.

The academic affiliation between Omaha-based Creighton and St. Joseph’s will bring nearly 30 percent of Creighton’s medical students to Phoenix for two years of clinical studies. Since 2005, Creighton has sent relatively few medical school students to St. Joseph’s for one-month rotations. Under the new agreement, 42, third-year Creighton students will arrive at St. Joseph’s in 2012 and in 2013, for a total of 84 students on the new campus, to be known as the Creighton University School of Medicine at St. Joseph’s Hospital and Medical Center. Creighton will provide an associate dean and several administrative support staff, but faculty instructors will be St. Joseph’s doctors and other medical personnel.

Linda Hunt, service area president of Catholic Healthcare West Arizona, president of St. Joseph’s and chair of the Greater Phoenix Economic Council’s Healthcare Leadership Council, says the goal is to retain many of the students in Arizona for residency and eventually have them set up practices here.

“We’re a large population and when you compare us to the rest of the country we have to import our physicians,” Hunt says. “We need the capacity to educate and to care for more of the population.”

The Cardon Children’s Medical Center, which opened Nov. 9, provides comprehensive pediatric care for children. The facility has 248 beds and works with 225 physicians. Top specialties include cancer, neurology, emergency services, surgery, and a level-III neonatal intensive care unit.

“Children often need special help coping with acute and chronic illness,” says Peter Fine, Banner Health president and CEO. “We know Cardon Children’s Medical Center will make a difference in the lives of countless children and their families. Its opening will offer a new option for outstanding pediatric care that is clearly needed by the Valley’s growing population.”

Meanwhile, the University of Texas M. D. Anderson Cancer Center joined forces with Banner Health on Dec. 1, launching construction of a facility intended to deliver an unprecedented level of cancer care to patients in Arizona. Along with treating cancer patients, M. D. Anderson, based in Houston, also offers access to therapeutic clinical research exploring novel treatments.

Fine calls the relationship with M.D. Anderson “a major milestone in the vision of our two organizations to provide access to a new level of cancer care in Arizona.”

The $107 million, 76-bed center will be a 120,000 square foot, three-story building focusing on outpatient services, including physician clinics, medical imaging, radiation oncology, infusion therapy and many support services. Inpatients will be treated on two floors inside Banner Gateway Medical Center.

“M.D. Anderson is not and will not be something similar to what exists in the Phoenix market today,” Fine says. “We are bringing the No. 1 cancer center in the country to Arizona and to have them run it as closely as is possible. There will be significant amounts of automation tying in all their clinicians in this marketplace to clinicians in their Houston campus. For research purposes, protocol purposes, they will in essence be one clinical business on two campuses.”

In 2008, Phoenix Children’s Hospital broke ground on a $588-million expansion that includes an 11-story patient tower scheduled for completion by 2012. As of December 2009, Phase I marked its halfway point, was on-budget and on-schedule. The project will increase the number of its licensed beds to 626 from 345.

Bob Meyer, president and CEO of Phoenix Children’s Hospital, says research indicates Maricopa County has more than 1 million children today and by 2025, an additional 500,000 to 700,000 youngsters will be living in the Greater Phoenix area.

“If you believe those numbers,” Meyer says, “deficits in pediatric capacity are astounding. Estimates are that we will be short 800 pediatric beds by 2025, and short about 400 pediatric specialists.”

Another key reason for the expansion, Meyer says, is that the existing hospital building, which was built in the late 1960s, does not have the floor-to-ceiling height to accommodate today’s newer technology.

Dr. William Crist, vice president of health affairs at the University of Arizona, says the ongoing expansion projects in Greater Phoenix really are thoughtful plans for growth and development of service for a city that’s expanding markedly — even though that growth has leveled off because of the recession.

Crist cites the aging baby boomer generation as the reason for an increasing need in expanded adult medical care.

“Potentially, most cancer occurs in older individuals,” Crist says. “The aging of our population is made possible by advances in health care. It keeps you alive long enough to develop chronic illnesses.”

www.creighton.edu | www.stjosephs-phx.org | www.bannerhealth.com | www.mdanderson.org | www.phoenixchildrens.com | www.arizona.edu


Arizona Business Magazine

February 2010

Who To Watch: Gary Naumann

Gary Naumann
Director
ASU Spirit of Enterprise Center

Small businesses are guardedly optimistic about 2010, says Gary Naumann, who heads the ASU Spirit of Enterprise Center at the W. P. Carey School of Business. He senses the mood from what he sees and hears, especially from entrepreneurs who attended the 13th annual Spirit of Enterprise Awards last September.

“You can only look down at your shoes for so long,” he says. “It’s a lot more fun to look up. That’s what I sensed from the crowd of 800-plus at the awards event.”

Under Naumann’s leadership, programs at the Spirit of Enterprise Center are providing assistance to small businesses and real-life experience for students.

“People come up to me on a regular basis and say they’re thinking about starting a business or expanding,” he says.
As examples of the optimism he is starting to see, Naumann mentions two of the small businesses that were honored by the center this year. Caliente Construction is targeting 20 percent growth next year, and Terralever, an Internet-based marketing company, recently expanded to Los Angeles.

“That’s why we picked them — they’re doing good things in a tough market,” he says. “If we were able to find these kinds of small businesses in the last few years, we sure as heck are going to find them for our awards next September.”

Without duplicating other services offered at the School of Business, Naumann says the center’s focus is on opening doors to opportunity. The center assists hundreds of businesses each year, mostly small firms, by providing guidance and connections to key resources.

“The type of businesses we help is across the board,” Naumann says. “We believe entrepreneurship is alive and well, even though this is such a tough time to start a business. Dislocation creates opportunity. We’re definitely in that period where there has been a lot of dislocation the last 12 to 18 months. People look around and wonder what they can do to take charge of their future. That’s a very healthy thing for our economy.”

Naumann, who has been in the entrepreneurial field for 30 years, says the center will continue to honor entrepreneurs who are showing promise, and educate young entrepreneurs of the future. He has lined up three new guest speakers from different walks of life to share their experiences with students.

“We landed a venture capitalist, and they’re hard to find,” Naumann says. “Students hear from guest speakers about what they did right in business and missteps they took and corrected. They learn more from hearing about the mistakes.”

To do well next year, small businesses must be prepared to do a fair amount of what Naumann calls “heavy lifting.”

“They’ll have to do two things at the same time, even though they almost don’t seem to go hand in hand,” he says. “They’ve got to watch their cash flow like a hawk, and at the same time they have to have one eye toward growth of the business. People who are going to succeed are going to be on these two paths.”

wpcarey.asu.edu/spirit


Arizona Business Magazine

January 2010