Copper, cattle, cotton, citrus and climate. These “Five C’s” were the core of Arizona’s economy when it first became a state. Though not as important today, they assist in bringing residents and tourists alike to Arizona. If you went to elementary school here you may have heard of these in the classroom. If not, here is a quick breakdown:
The Greater Phoenix Economic Council (GPEC) is sharpening its international approach with an aim toward bringing more foreign direct investment to the state. To that end, GPEC has restructured its International Leadership Committee (ILC).
“My vision is to put Arizona on the radar,” says Rudy Vetter, senior vice president of international business development at GPEC.
Sharon Harper, president and CEO of The Plaza Companies, is one of the ILC’s co-chairmen. The Plaza Companies is the co-developer of SkySong, a mixed-use development in Scottsdale with a focus on global industries.
“Repositioning the (ILC) board and a more strategic focus on foreign direct investment on Europe, Asia and Canada has resulted in a greater number of international prospects and successes,” she says.
Harper notes that the top-tier markets for the committee are those that best align with Arizona, such as China, Germany, Italy, Spain, France, the United Kingdom and the Netherlands, along with Japan, Korea and Canada.
The specific industries being targeted are solar energy, other renewable energy products, clean tech and environmental technology, biotech, medical and life sciences, as well as high-tech manufacturing.
“There is a great opportunity for Arizona and Greater Phoenix to benefit significantly from foreign direct investments. By focusing on Arizona’s core strengths, and specifically the vision at SkySong and other projects that are focused on the global economy, Arizona will be attracting and creating good jobs for our region,” Harper says.
Reducing the committee’s size, along with adding leading investors and major academic leaders in the Valley to its roster, has resulted in a concerted effort to make a more powerful impact in the international arena. Intel, Arizona State University, Thunderbird School of Global Management and the University of Phoenix all have a presence on the committee, as well as representatives from the United Kingdom, Germany, Canada and the Netherlands, among others.
“The key element for the ILC is that they invest their expertise, their skills and knowledge about international affairs, and they combine that with investing into their network, connections and international activity,” Vetter says.
With a diverse and experienced pool of senior executives on the committee, the main goal is to get the word out about Arizona and the many perks it offers.
“It’s about creating awareness,” Vetter says. “Arizona is not necessarily the first state that comes to mind to an international investor. (It’s up to us) to make them aware of the great qualities this place has.
“Very often, we create first contact by meeting companies during trade shows and conferences; we find out if there is a company interested in an operation in the U.S., and we make the case for Arizona and Greater Phoenix,” Vetter adds.
He points out that although Arizona can’t compete with companies looking for an East Coast presence, when it comes to the West, the committee’s job is to ensure the state is on the shortlist of candidates.
Since the passage of the Renewable Energy Tax Incentive Program, Arizona has become a power player in the solar industry, attracting several high-level, international companies to the Valley. To keep the momentum going, Vetter and the rest of the committee work closely with international companies, providing them with step-by-step plans to make their entrance into Arizona a smooth one. The process of foreign companies setting up a presence domestically comes with many challenges, and GPEC strives to ensure the companies’ success.
“It’s a seed that we have to nurture, and sooner or later we can grow a plant,” Vetter says. “They’re coming with an investment, but they have to create the business from scratch. GPEC connects them with local business to get them started faster and to create mutual benefit for the whole community. We hear all the time from companies that locate here; they love this one-stop shopping (GPEC offers).”
As the ILC continues on its mission to attract foreign investors to the area, it also will continue to focus on building a strong sustainability industry in the state.
“The idea of seeing the Valley plastered with solar panels, people driving cars they can plug in and knowing they don’t have to pay their utility bills is a nice vision — but we are not that far from it anymore,” Vetter says.
Forests of Saguaro cacti lit by fiery red and orange sunsets, gun-toting cowboys staging shoot-outs, and the Grand Canyon’s striated walls looming over the Colorado River.
One would think these distinctly Arizona images could sell themselves. Unfortunately, Arizona’s tourism industry is learning the hard way that it takes more than just the state’s natural beauty and attractions to bring in visitors — it takes dollars.
“That’s why we need to be out there marketing Arizona, reminding people about what a great, wonderful, warm, welcoming destination we are,” says Debbie Johnson, executive director of the Arizona Tourism Alliance and president and CEO of the Arizona Hotel & Lodging Association.
The recession caused Arizona’s once vibrant tourism industry to flounder, and in 2009, the stigma related to the corporate meetings industry continued the industry’s downward spiral.
“We weren’t just feeling the pain like everybody else. We were getting hit much more significantly than the nation overall,” says Mitch Nichols, president of Nichols Tourism Group, which provides research services to the tourism industry.
Visitor spending in Arizona decreased 10.6 percent, while the nation saw a decrease of just 4.4 percent, from 2007 to 2009. Additionally, Arizona lost $780 million in potential visitor spending because its share of national travel expenditures dropped from 2005 to 2008, according to Nichols Tourism Group.
In early 2010, the state Legislature dealt the industry a one-two punch when it passed SB 1070 and redirected funds from the Arizona Office of Tourism’s (AOT) budget to the general fund.
The Legislature redirected the tourism formula fund, which is composed of 3.5 percent of the state’s bed tax, 3 percent of the state’s amusement tax, and 2 percent of the state’s restaurant tax. This redirection will take approximately $28 million away from AOT over the 2011 and 2012 fiscal years.
In November 2010, the Center for American Progress, a progressive think tank, announced more bad news for Arizona’s tourism industry. In a study, it was reported that the controversial SB 1070 bill had cost the state $141.4 million in lost spending.
However, the industry isn’t down for the count.
Led by the Arizona Tourism Alliance, the tourism industry is campaigning to reclaim the budget, which it believes will help pull Arizona out of the recession and return millions of visitors to Arizona.
While the long-term effects of SB 1070 on the tourism industry are hard to quantify, the budget redirection is projected to cost Arizona big.
Even the most conservative estimate puts the state’s losses at $26.7 million, but “actual revenue losses could potentially be many times this amount,” according to an independent study by Elliot D. Pollack & Co.
Nichols Tourism Group estimates the state could lose as much as $1.6 billion.
“You’re not finding $14 million. You’re creating a much bigger hole that will have to be funded in the future,” Nichols says.
The redirection of money decimated AOT’s marketing budget, allowing other states to sneak in and steal Arizona’s market share. These states recently discovered the tourism industry’s power to pull a state out of the recession.
“Some of our key competitors, California in particular, got much more aggressive in terms of the resources they were spending to try and convince visitors to choose California,” Nichols says.
Arizona is becoming out of sight, out of mind, and statistics prove it, Johnson adds.
From January to August 2010, the daily rate for Arizona hotel rooms declined 4.4 percent, while the nation’s daily rate only declined by 1 percent, and California’s daily rate declined by 1.1 percent, according to Nichols Tourism Group.
“Too often there’s a mindset that people will come whether or not you advertise. And we’ve got to increasingly ensure that kind of mindset does not carry the day,” Nichols says.
To remedy the industry’s declining revenue, Arizona’s Legislature needs to be reminded of what tourism means to the state. Tourism brings in revenue that funds education and many of the public services that are necessary during recessionary times.
The return on investment for every dollar spent on tourism marketing is seven to one, out-of-state studies show, according to the Pollack study.
In addition to pulling in revenue, the tourism industry directly and indirectly employs around 300,000 Arizonans, about 10 percent of the state’s work force.
Two key pieces of Arizona’s future, the economy and the work force, depend upon tourism. If the budget is restored, and soon, Arizona can rebound to pre-recession numbers within five years, Johnson says.
“Our destination has shown … that we can come back from adversity,” Johnson says. “We saw that after 9/11. (We were) one of the top five destinations, in terms of rebounding. I think we’re going to see that again because of what we have to offer, because we do have such a strong industry here. We’re a united industry. We work together and we come together in times like this. I think you’re going to see Arizona rebound.”
AZ Business Magazine Jan/Feb 2011
Give us a look ahead at Greater Phoenix’s major industries.
The emergence of solar and renewable energy has been, and will continue to be, a big opportunity for us. We need to learn, as a market, how to be involved in new technology initiatives. There are going to be wins, losses and volatility, but the renewable space is going to continue to grow.
From January to November 2010, 1,350 jobs and $153 million in capital investment have been created. Renewable energy projects now make up about 28 percent of the companies looking at our region.
In addition to the renewable energy industry, health care, life sciences and information communication technology will expand next year. All of this is plagued by inconsistency in the capital markets. There is not enough private equity and there is no real IPO (initial public offering) market. Whenever you are building a new technology, it is really important that capital markets are responsive.
What kinds of jobs does GPEC look to attract and grow in Greater Phoenix?
We’re probably having the best year for attracting engineers and professional jobs that GPEC has ever had as an organization. These quality jobs are fueled by the fact that renewable energy is the new technology space.
GPEC is performing at a high level, even though the country is still in a recession. We have already driven 4,400 jobs to Greater Phoenix from July to October 2010. Of those jobs, 66 percent provide high wages. We want to see even more high-quality jobs this year. Hopefully, we will continue to drive regional headquarters, and professional services and technology jobs in the region.
GPEC talks a lot about competitiveness. Why is this important, and what specifically is GPEC doing to make the region more competitive?
For a long time, GPEC has focused efforts on increasing the region’s competitiveness. It’s absolutely critical because every major investment is analyzed by people with very astute backgrounds for its financial implications, talent and long-term viability. The most common differentiating point for a market is its competitive position. We look at the cost of doing business, the speed of doing business, ability to attract talent and access to capital.
GPEC has several initiatives to push Greater Phoenix into more globally competitive circles. The region — historically — has relied on retail, construction and real estate sectors to our own detriment. We have a high-quality job formula. Arizona will increase its competitive position with GPEC’s proposal to drive large company expansions, increasing our local, talented work force, and improving our tax climate. Working on job creation legislation with Tucson Regional Economic Opportunities (TREO), rural partners, the Arizona Commerce Authority and chamber partners is going to be really important this year. GPEC also works closely with the Arizona Chamber of Commerce, Arizona Small Business Association, Greater Phoenix Chamber of Commerce, Greater Phoenix Leadership, and our communities and mayors.
It wasn’t that long ago, just four years ago, that Arizona was ranked No. 1 in the country for job growth. Now, we have fallen to almost last in the country — 48th place. We need to understand how to improve the environment for business and compete in new technologies and industries. That is going to make the difference for Greater Phoenix as it recovers from the housing slump and shifts the job base away from the real estate industry to export industries.
-In 2002, Steve Chucri was lobbying at the state level when the Arizona Restaurant Association president and CEO position was presented to him. Chucri now uses his political and lobbyist backgrounds to help Arizona’s restaurant industry navigate today’s tough issues. An executive committee board member with the Arizona Tourism Alliance, Chucri discusses strategies to create workable solutions to many issues affecting his industry.
Could the recession have been worse for the restaurant industry?
I always think it can be worse, because you don’t know worse unless you’re in it. That being said, yes, the economic hit, the recessionary hit to our industry was substantial. It may not be as substantial as to other elements of the tourism industry, but when you have the closing of restaurants double from normal times during this recessionary time, that’s pretty substantial. … I’m not going to say we were the worst or we were the most impacted, but there has been a huge impact from the most experienced restaurateur to the novices of the industry. Both were equally hit.
How have the arizona restaurant Association and the arizona tourism alliance been working together to get through the recession?
Restaurants over the recent years have become more and more dependent on tourist dollars. The receipts show that. About 25 percent of our receipts from restaurants are coming from tourists. … I think what we’ve been able to work on with both organizations is how do we continue to work together and make Arizona a destination? We’re becoming more and more known for our culinary fare.
Second to that, we’ve also worked legislatively together to ensure we’re not being targeted for miscellaneous taxes and we’re not getting targeted as an industry when it comes to funding issues, especially the Arizona Office of Tourism.
What challenges do you see facing the restaurant industry in 2011?
I see an increase in costs. We’ve been fortunate to maintain costs at a low level because of the recession, but I’m getting concerned that if things do start to pick up we will see costs starting to rise. I feel as though the smallest of things, the profitability of a restaurant, is very, very low and it doesn’t take much. You can’t just go to your menu and start raising prices in an economy like this. … I think we’re going to make a real push to see how we can get rid of that CPI (consumer price index) component with the minimum wage, but I don’t want to dwell too much on that, as we’re still in the strategic phases.
On the good side too, I believe that people are going to realize, yes we’re in a recessionary time but restaurants essentially are on sale right now. … I see people also realizing, like I said on the positive side, that it isn’t all that expensive to go out to eat.
How has Arizona’s restaurant industry been recovering from the recession?
In many, many ways, across many segments of our industry, it’s been at a snail’s pace. … I will tell you that 2010, from the quick-serve industry all the way to fine dining, it has been better than 2009. Now, that’s not universal, but the increases we are seeing are at a snail’s pace.
I think the wish, if there was one, of the industry would be that growth would pick up a little more quickly. Not at the crazy pace we were going at back in 2006, 2005, but something that is more meaningful and can be measured. … I think that restaurants are doing all they can to make sure that happens by offering these terrific deals and really using a lot of ingenuity and happy hours.
Restaurants are really good at incentivizing and getting people to come in. I think we’ll always continue to see that happen. … If restaurants can grow and if our industry can grow back up to the 4 percent or 5 percent and it’s sustainable each month and it’s sustainable on a consistent basis, you’d see a lot of smiles on restaurateurs’ faces.
Dan Litteral has been in higher education and has practiced regulatory law for more than 20 years, and that experience has enhanced his involvement with Valley Forward.
Litteral joined Valley Forward in 2007 through Apollo Group and the University of Phoenix, which have both been longstanding members and supporters of the organization.
“It became apparent to me that Valley Forward was an almost uniquely positioned organization for a metropolitan area that was really committed to public dialogue between organizations and civic leaders, to promote environmentally sensible development,” Litteral says.
Before working for the University of Phoenix and Apollo Group, Litteral spent 20 years practicing law in the Washington D.C., area. He helped build the in-house legal department at the University of Phoenix and was University of Phoenix general counsel from 2003-2007. Litteral then was moved up to the Apollo Group where he currently runs a practice group for Apollo that provides education and regulatory law services.
Litteral says Valley Forward is staying fresh and relevant, and is important to Apollo Group because it has aligned goals. Apollo Group has focused on sustainability and appropriate environmental usages.
Since 2008, Litteral has sat on the Valley Forward board of directors and executive committee. He was also chair of Valley Forward’s Earthfest Educators Night, an annual event that invites between 300 and 500 teachers from around the Valley to learn about environmental education so they can share the information with their students.
Litteral wants to see a focus on continued relevance from Valley Forward. He says that as the economy turns around and the organization grows, it is important to improve the issues that revolve around sustainability.
“Valley Forward clearly wants to be the environmental go-to organization in the Valley in terms of balancing the need for growth, development an stability,” Litteral says. “By undertaking events and continuing to engage leaders in corporations and the business world, it will fulfill that mission.”
Valley Forward works with organizations such as Apollo Group to educate the community and businesses on how to be sustainable and environmentally friendly. Valley Forward provides an opportunity for public dialogue of discussing how to move forward with environmental considerations.
“Valley Forward has a long track record of making the Valley a good place to live and work, while understanding we need to continue to develop and grow, and to do so in an environmentally friendly way,” Litteral says.
Total construction spending increased by 0.7 percent in October, driven largely by growing demand for power projects and public construction, the Associated General Contractors of America noted today in an analysis of new Census Bureau data.
The new data, however, indicated continued weakness in many construction categories, including private nonresidential and single family construction, association officials observed.
“Without any upward trend in key private-sector construction components like homes and office buildings, it is hard to feel optimistic about the near future,” says Ken Simonson, the association’s chief economist. “With public construction at risk of cutbacks, it is premature to conclude that construction has awakened from its long nightmare.”
Simonson added that power construction increased by 8.8 percent between September and October at a seasonally adjusted rate, although the total remained 3.9 percent below the year-ago level. Public construction, aided by federal spending on stimulus, military base realignment and Gulf Coast hurricane-control projects, edged up 0.4 percent for the month and 2.2 percent year-over-year.
Private nonresidential construction, however, slumped 0.7 percent in October, leaving the total 20.7 percent below the October 2009 figure. All 11 of the Census Bureau’s private nonresidential categories were below year-ago levels, Simonson added, with only private power and transportation showing gains from September.
Private residential investment jumped 2.5 percent for the month. However, Simonson cautioned that the apparent leap is attributable to a 3.2 percent advance in new multi-family construction and a 6.2 percent rise in improvements to existing properties, whereas single-family construction sank 1.2 percent for the month.
Association officials said that a proposal released today by the Deficit Commission to increase investments in highways, bridges and transit system construction provided some room for optimism. They urged Congress to embrace the transportation proposal, noting it would help the economy over the long run while giving a much-needed boost to short term construction demand.
“The best way to reduce the deficit and simultaneously support a strong and expanding economy is to invest in our aging network of highways, bridges and transit systems,” said Stephen E. Sandherr. “Even as the broader report calls for dramatic reductions in federal spending, it is clear that our country can’t afford to neglect its infrastructure.”
We all know major department stores have big holiday sales, but so do local stores.
Local stores also have the added bonus of being good for your conscience. They’re greener – many of their products aren’t shipped in from all over the world – and they help the local economy more than chain stores. See our recent Local First Shift Arizona article.
If you’re looking to shop local this holiday season, here’s a few Phoenix-area shops to help you on your search for the perfect Hanukkah, Christmas or Christmakkah gift.
1. Souvia Tea
Souvia Tea is stocked with more than 140 teas and gifts for tea lovers. Souvia Tea is part of Local First Arizona’s Buy Local Week that offers deals on local products from Nov. 26 to Dec. 5.
15414 N. 7th St. Ste. 8
Phoenix, Ariz. 85022
2. Natural Paws
For the month of November, Natural Paws is discounting all Web sales 10 percent and offering free shipping. Natural Paws is part of Local First Arizona’s Buy Local Week that offers deals on local products from Nov. 26 to Dec. 5.
3. Pink House Boutique
Pink House Boutique is a one-of-a-kind co-op bursting with home décor, recycled, new and vintage clothing, and much more. The boutique also features local designer Bri Bridge.
7009 N. 58th Ave.
Glendale, Ariz. 85301
4. SeeSaw Designs
Find unique stationary, prints and calendars at SeeSaw Designs.
6125 E. Indian School Road Ste. 2009
Scottsdale, Ariz. 85251
5. Embellish Home
Give the gift of embellishment from Embellish Home. The store offers everything from decorative crowns to whimsical tea towels.
5202 N. 7th St.
Phoenix, Ariz. 85014
6. Frances & 7. Smeeks
Here’s a double dose of local. Frances and Smeeks, both owned by the same woman and located on the same stretch of Camelback Road, are chalk full of everything from vintage candy to clothes to paper goods.
10 W. Camelback Road
Phoenix, Ariz. 85013
14 W. Camelback Road
Phoenix, AZ 85013
8. Sphinx Ranch
For the foodie in your life, look no further than Sphinx Ranch. The shop specializes in gift baskets, but you can pick up anything from Arizona wines to chips and salsa produced locally at their store.
3039 N. Scottsdale Road
Scottsdale, Ariz. 85251
9. Maria Funicello Jewelry Designs
If your gal likes to shine, check out Maria Funicello Jewelry Designs. These beautifully crafted silver pieces are sure to wow her this holiday season.
Etsy.com is the perfect place to shop several shops at a time. Just use Etsy’s Geolocator to find sellers in Phoenix, Scottsdale, Flagstaff, Tucson and many more cities. You can find practically anything from a local seller on Etsy, from aprons to jewelry to soap to home furnishings.
Here’s a few Arizona Etsy sellers to check out:
Petite Bonfire – Sewn goods, Tucson
Wing Flash – Jewelry, Tucson
Rose & Root – Soaps, Phoenix
The Tom Kat Studio – Party supplies, Chandler
Jason Hill Design – Artwork, Phoenix
Mommy’s Little Monsters – Children’s clothing, Phoenix
Nesta Home – Home decor, Phoenix
Pink Dandy Shop – Bath and cosmetic products, Phoenix
Spinup Yarns – Yarn, Flagstaff
Red Canyon Glass – Glassware, Flagstaff
Visit Local First’s Web site for a list of local shops and Tucson shops participating in Buy Local Week.
This week on AZNow.Biz, our Buzz story looks at a Phoenix-based auction house that had its own reality show. Also, our work force columnist, Marcia Rhodes, looks at the decline of cost-of-living adjustments in favor of merit pay.
If you’re from Arizona, chances are you haven’t experienced Jack Frost nipping at your nose while skating around an outdoor rink.
Bust out your mittens, hats and scarves, Arizonans, because that’s about to change.
Olympic ice dancer Ryan O’Meara is bringing winter fun to downtown Scottsdale. The rink will sit outside of Palavela Home, the interior design store he owns with his mother Sue O’Meara, for the month of December, and is open to the public.
“For me it’s so different skating outside,” O’Meara says. “[I’ve] spent pretty much my whole life on a skating rink. … [But] it’s completely different feel.”
The rink isn’t just about family fun, it’s also about bringing attention to downtown Scottsdale retail stores in a rough economy, O’Meara says. With an outdoor rink, customers get a chance to explore the shopping opportunities while having fun, he says.
The rink is “a way to boost the downtown Scottsdale area, as well as giving back to the community,” O’Meara says.
O’Meara teamed the rink up with four local charities, giving each charity a week in December to call their own. Each week 15 percent of store and ice rink sales will be donated to the designated charity. The charities, in order, are Homeward Bound, Southwest Center for HIV/AIDS, the Arizona Chapter of The ALS Association and Ryan House.
O’Meara will be out on the ice with his partner, Emily Nussear, and Thursdays at 7 p.m. and Sundays at 2 p.m. a local amateur skaters will put on a free show.
But if you’re looking to stake out a piece of the ice to practice your triple salchow or quadruple lutz, you should call ahead. The rink can hold only 40 skaters at a time, and O’Meara strongly suggests you reserve a spot.
This is a unique opportunity to skate outdoors in winter weather that doesn’t give you instant frostbite, O’Meara says.
Wondering how the ice is going to stay frozen? The rink will be made of synthetic ice, which allows skaters to glide around as if on real ice, but without the added cost of refrigeration.
On a side note, Palavela Home is named for the arena O’Meara skated in during the 2006 Winter Olympics in Torino, Italy. After retiring from skating, O’Meara transitioned to a career as an interior designer.
If You Go:
4222 N. Marshall Way
Scottsdale, Ariz. 85251
Hours: 11 a.m.–9 p.m. daily, except Dec. 23–25
Cost: $15 per 45-minute session–skates included
Reservations: 480-946-1006 or email@example.com
The state’s unemployment rate dropped two-tenths of a percent to 9.5 percent in October, as the economy added 27,400 jobs. This is the largest October job gain since 2004. The Arizona Commerce Authority (ACA) reports today that the private sector generated 93 percent of those jobs, or 25,600. Year-over-year, total non-farm employment was up 1.1 percent last month.
|Oct. 2010||Sept. 2010||Oct. 2009|
This is the third consecutive month of over-the-year gains in total nonfarm employment, and the rate of gains has been increasing each month. According to the ACA, Arizona now ranks 18th in the nation in over-the-year employment growth. The state was ranked 32nd in September. Significantly, Arizona’s construction industry continued to show signs of improvement, and in October posted its first over-the-year increase since December 2006.
“Overall, Arizona’s employment situation is beginning to show indications of welcome improvements,” according to the ACA employment report.
|Oct. 2010||Sept. 2010||Oct. 2009|
Over the month, 10 out of the state’s 11 major sectors saw job gains. The sector that had the most gains for the month was trade, transportation and utilities, with 7,100.
Gains were reported in: professional and business services (1,700); financial activities (600); educational and health services (6,400); natural resources and mining (100); construction (5,100); leisure and hospitality (3,300); government (1,800); other services (1,400); and manufacturing (200).
The only sector to lose jobs was information (-300).
The unemployment rates dropped in almost all of the state’s largest metro areas.
|Oct. 2010||Sept. 2010||Oct.2009|
President Barack Obama has signed a bill that aims to increase small business lending. But it’s not exactly popular among Arizona’s small companies and community banks. They question whether a multibillion-dollar loan fund created by the legislation will achieve its goal.
The Small Business Jobs and Credit Act of 2010 will establish a $30 billion Small Business Lending Fund within the U.S. Treasury. The Treasury will use that money to purchase preferred shares in small- to medium-size banks that voluntarily participate in the program, injecting new capital that the banks would be encouraged to lend to small businesses. The more loans the banks make, the lower the dividend rate they pay the Treasury.
“As a small business owner, I am allergic to government intervention,” says Charlie O’Dowd, president of Westcap Solar, a Tucson company that sells and installs solar photovoltaic and solar hot-water systems. “I don’t think that this legislation is going to be any more effective than the TARP (Troubled Asset Relief Program) legislation. In this economy, it’s not that there isn’t money to be borrowed. It’s qualifying for the loan that’s the problem.”
The new law also gives John P. Lewis a bad taste in his mouth. Lewis is president and CEO of Southern Arizona Community Bank in Tucson, and a member of the FDIC’s Advisory Committee On Community Banking.
“Last January, the committee had a robust discussion (on the legislation),” Lewis says. “The committee said, ‘We don’t want to be a part of this.’ Community banks don’t need the additional capital. I have more money than I know what to do with. I need qualified borrowers.”
O’Dowd and Lewis describe a situation that is frustrating for both and that neither believes government policy will resolve. O’Dowd says small businesses’ sales are slow, impacting their ability to qualify for loans. Lewis says his loan demand is flat because there are fewer qualified borrowers.
The Arizona Small Business Association points to a wary small business community that’s in no mood to take on more debt. Earlier in the recession, small businesses tried in vain to obtain bank loans, but now they are in survival mode, says Donna Davis, the association’s CEO.
“Bank loans are not at the top of their list now,” Davis says. “Some businesses have lending fatigue. They just gave up (trying to get loans). Now they are focused on lack of sales. If sales don’t pick up, if work doesn’t pick up, they won’t seek credit. If they can boost sales and profits, then they can justify hiring and expanding.”
One outside observer sees a triumvirate of doubt that the legislation will not mitigate. Dennis Hoffman, professor of economics at Arizona State University’s W. P. Carey School of Business, says this recession has caused consumers, businesses and banks to lose their confidence. Lacking the good credit risk they saw five years ago, banks have “pulled in their oars,” Hoffman says. Creditworthy businesses fret so much over the economy, they don’t even apply for loans. Recession-scarred consumers remain stingy.
“We need to climb this wall of worry to get out of this morass,” Hoffman says. “This is a market-based, private-sector issue that will have to work itself out.”
Gail Grace, president and CEO of Sunrise Bank of Arizona headquartered in Phoenix, doesn’t sense much support for the legislation among Arizona’s banks, and wonders how many community banks would be able to participate.
“Community banks in Arizona are stressed and many may not even qualify for this program,” Grace says. “You will still have to have a fairly healthy bank to qualify for this.”
Not everyone has a dim view of the law. Robert Blaney, Arizona’s Small Business Administration district director, notes that the law will increase the SBA’s loan guarantee from 75 percent to 90 percent, easing banks’ risk on those loans. The law also will lower fees and raise the SBA’s maximum loan amount from $2 million to $5 million. There are thousands of small business owners nationwide that were waiting for the lending bill to become law, Blaney says.
One of those is Benefits By Design, a Tempe company that sets up health benefit plans for small businesses. The company’s president, Kristine Kassel, says there is a need for loans and it would be helpful if just two community banks expanded their small business lending. She adds that any amount of new credit that can be extended to small businesses is a good thing.
Banks interested in acquiring low-cost capital might be attracted to the Treasury fund and they might be enticed by the built-in incentives to direct new-found capital into small business lending, says Dan Stewart, Arizona market president for Mutual of Omaha.
But then he echoes what others say: “The (law) doesn’t encourage banks to take on more credit risk, so qualified borrowers are the key.”
By the Numbers
- Establishes a $30 billion Small Business Lending Fund within the U.S. Treasury
- Treasury will use money to purchase preferred shares in small- to medium-size banks that voluntarily participate in the program
- SBA’s loan guarantee would increase from 75 percent to 90 percent
- The SBA’s maximum loan amount would increase from $2 million to $5 million
The Small Business Jobs and Credit Act of 2010
Arizona is on the receiving end of a multimillion-dollar defense contract.
The Boeing Company announced that it has received a $247 million contract to begin initial production of the U.S. Army’s AH-64D Apache Block III helicopter, the most advanced multi-role combat helicopter in the world. The helicopters will be assembled, flight-tested and delivered from the Boeing Global Strike facility in Mesa.
The new agreement covers the production costs of eight Apache Block III helicopters. However, a memorandum signed by the Department of Defense on Oct. 7 authorized the program to eventually produce 51 aircraft during the initial phase.
“Since the early 1980s, Boeing has successfully produced helicopters and developed new technologies in Arizona,” said Tony Ham, Boeing Mesa site leader, in a press release. “With the recently announced contract award for Apache Block III production, and additional work on other programs, our company leaders anticipate a continued and growing relationship with the people and industry within the state.”
Word of the Boeing contract comes days before the newly formed Arizona Commerce Authority hosts Aviation Week’s Aerospace and Defense Supply Chain Conference Nov. 1-3 at the Arizona Biltmore.
According to the Arizona Commerce Authority, the aerospace and defense industries form one of the largest sectors in Arizona’s economy, generating $8.8 billion in gross state product and providing more than 93,800 jobs.
“Arizona is renowned for its strength and rich history in aviation and aerospace,” said Rob Morton of the Arizona Commerce Authority, in a press release. “The state’s affordable business costs, relatively low taxes, and competitive regulations have made it home to many of the aerospace and defense industry’s top companies.”
The Arizona Commerce Authority, formerly the Arizona Department of Commerce, is a public-private entity working to attract businesses to the state and encourage the expansion of companies already here. The agency maintains foreign trade offices in Asia, Europe and Mexico.
Arizona touts dozens of breathtaking resorts with countless amenities, but there’s still room for more. The Wild Horse Pass Hotel & Casino in Chandler opened its doors in October 2009, and Talking Stick Resort in Scottsdale opened this past April. What makes the opening of these two new resorts all the more remarkable is that they happened during the worst economic downturn since the Great Depression.
Of course no one plans to open a hotel in a tough economy, but who could have predicted this level of devastation a few years back? However, Harold Baugus, CEO of Gila River Gaming Enterprises, the driving force behind the Wild Horse Pass Hotel & Casino, is not one to be easily deterred.
“We determined long ago that we needed a better, more sophisticated and more advanced product offering more entertainment value and better food and beverage for our clients,” he says. “In 2005, we started the process, and at that time the economy was on the upswing … but it doesn’t drive what we do. We wanted to build this product for the future of the community. The economy didn’t really play a factor.”
Steven Horowitz, director of sales for Talking Stick Resort, says the venture has proved successful so far, even in this economy.
“Hospitality demand was at its lowest during the majority of our building phase,” he says. “We were due to open when the economy would hopefully begin the cyclical upswing. That has been the case.”
Developed by the Salt River Pima-Maricopa Indian Community, Talking Stick encompasses a 240,000-square-foot casino in a 15-story tower that houses almost 500 rooms.
Despite early encouraging signs, Horowitz does think people are continuing to be very careful about how they spend their money.
“While we feel like Talking Stick Resort is opening as the economy is beginning to rebound, some of the initial challenges during recovery would be the lack of demand for resorts, and the overall economic downturn in gaming,” he says. “For obvious reasons, people have been very careful about their discretionary income, and entertainment, until recently, hasn’t been top priority.”
Baugus says his property is competing for all discretionary dollars, not just those targeted to other hotel properties.
“We have created an overall entertainment experience for those with complete discretionary income,” he says. “We are not necessarily concerned with other facilities or casinos, but rather if people are going to take those dollars to a ballpark or the movies.”
These properties offer guests a laundry list of entertainment and luxury options. Besides gaming and lounges, Talking Stick has its signature restaurant Orange Sky, multiple pools, and entertainment venues.
“We are truly an all-encompassing entertainment destination. A guest literally does not have to leave the property,” Horowitz says.
Baugus also is proud of the options and amenities available at Wild Horse Pass Hotel & Casino. The 10-story property has 242 hotel rooms with a 100,000-square-foot casino. It also boasts a range of dining options, including the area’s only Shula’s Steak House; a 1,400-seat entertainment venue; the AiRIA nightclub; and pool parties.
“We’ve tried to offer something for every demographic,” he adds.
The two resorts also offer plenty of meeting space for corporate or organizational gatherings. Talking Stick has 100,000 square feet of indoor/outdoor meeting and banquet space; Wild Horse Pass Hotel & Casino has about 12,000 square feet of meeting space.
Along with providing world-class amenities and entertainment, the actual construction of these facilities has given the local economy a much needed boost. The opening of Wild Horse Pass Hotel & Casino added about 500 jobs. During construction, 1,000 workers a day were employed to complete the facility. Talking Stick Resort added 600 jobs to the economy when it opened, and employed hundreds of additional workers during its construction phases, as well.
Both Baugus and Horowitz are pleased with the resorts’ initial numbers and neither is letting the summer heat slow down that momentum. Talking Stick Resort offers regular gaming promotions and a concert series. Wild Horse Pass Hotel & Casino has kicked off a comedy series for the summer, pool parties and golf specials.
The Valley’s resorts are often ideal places for staycations during the summer, and both properties appear to be generating interest from the locals.
“There are so many facets of Talking Stick Resort that you just can’t see or get anywhere else, and that naturally sparks interest from folks both locally and those who are out of town,” Horowitz says.
Baugus adds: “We have had a tremendously positive response and have already seen repeat business. People were pleasantly surprised with the opening. They were not expecting this level of quality.”
If You Go:
Wild Horse Pass Hotel & Casino
5040 Wild Horse Pass Blvd., Chandler
Talking Stick Resort
9800 E. Indian Bend Road, Scottsdale
The state added 16,000 jobs in September, mostly due to the start of the new school year. Despite the modest gains, the Arizona Department of Commerce reported today that the state’s unemployment rate remains at 9.7 percent
|Sept. 2010||Aug. 2010||Sept. 2009|
Year-over-year, total non-farm employment was up 0.5 percent last month. August’s year-over-year numbers were revised from a loss of 0.1 percent in total non-farm employment to a gain of 0.3 percent. The August gains broke a 30-month streak of over-the-year job losses for the state.
For the month, the state’s employment gain of 0.7 percent were below the 10-year average, but was better than the previous two years, when the economy generated job growth of 0.2 percent in September 2008 and 0.5 percent in September 2009. The private sector had an anemic net gain of 700 jobs last month. However, for the past three Septembers, the private sector has lost jobs.
|Sept. 2010||Aug. 2010||Sept. 2009|
|Monthly % Change||0.7%||1.6%||0.5%|
|Annual % Change||0.5%||0.3%||-8%|
Over the month, six sectors gained jobs and five lost jobs. The sector that had the most gains for the month was government, with 15,300. But those jobs came primarily from local and state education, with losses in the federal government offsetting some of the gains.
Professional and business services added 2,900 jobs; financial activities gained 1,700; educational and health services rose by 1,200; natural resources and mining generated 200 jobs; and construction also saw job gains of 200 in September
The professional and business services sector boasts the highest over-the-year job gains with 13,800. Over the year, trade, transportation and utilities was up 10,100 jobs; educational and health services gained 8,800; leisure and hospitality had a 1,500-job gain; and natural resources and mining generated 1,200 positions.
Over-the year losses were recorded with government (-7,300); construction (-6,100); other services (-4,000); financial activities (-2,500); information (-2,000); and manufacturing (-1,800).
The unemployment rates in the state’s largest metro areas mostly held steady or dropped slightly in September.
|Sept. 2010||Aug. 2010||Sept.2009|
David G. Rosenbaum, CHME
Director of Sales and Marketing
Fiesta Resort Conference Center
When David Rosenbaum first joined the Arizona Sunbelt Chapter of MPI 10 years ago, he was looking to take advantage of the group’s business and networking opportunities, and gain exposure to various meeting planners around the state.
As he became more involved in MPI, his career also jumped, and today, Rosenbaum is director of sales and marketing at the Fiesta Resort Conference Center in Tempe.
Rosenbaum grew up in the resort industry. He started 35 years ago in operations, working behind the front desk and parking cars. He was then given the opportunity to work a different angle of the business.
“I came out of operations and I thought I’d be in sales for two or three years, and then I’d get back into operations,” says Rosenbaum, who adds he has been in sales for 25 years.
Although he is not currently on any local MPI committees, Rosenbaum has participated in the student relations and programs committee, and has helped with planning various galas and events the chapter hosts. He remains involved with MPI by supporting the many people on his sales team who also are members of the chapter. Rosenbaum makes sure his employees get the time they need to become active members of MPI.
He says MPI is facing several challenges because of the down economy, namely a drop in membership. That, he says, is preventing the local chapter from meeting its full potential.
“The people that are supporting the membership are stretched thin, and are not as productive as they otherwise could be,” Rosenbaum says.
He says the solution to keep membership increasing is to provide more value to AzMPI.
“The more members we have, the more support, the more talent, the more creative ideas and the more successful our chapter will be,” Rosenbaum says.
Although many people join MPI for the business opportunities and networking, Rosenbaum says the most important thing he gets back from the organization is education. He enjoys just sitting down with other members and learning from them.
In the next year, Rosenbaum wants to see the local MPI add more educational programs, such as the ones he attended on surviving in this economy and keeping up to date with technology.
“Basically any education that makes us better prepared as professionals, that is where the value and the ROI is,” Rosenbaum says.
Mindy Gunn, AVP, CMP
Technology and Operations Group Event Manager
Wells Fargo Bank
Mindy Gunn didn’t choose event planning — it chose her.
Gunn planned on attending law school, but she switched career paths when she was offered a job as a meeting planner with Wells Fargo Bank.
“My start in the meetings and events industry came when I co-founded a nonprofit organization in college that produced and promoted free concerts and theatrical productions in the community,” Gunn says, adding that she also produced events while working at Wells Fargo as she attended Brigham Young University.
Gunn has been with Wells Fargo for 15 years, starting as a teller.
In her role as an event manager, Gunn joined the Arizona Sunbelt Chapter of Meeting Professionals International seven years ago. She initially joined as a way to gain her certified meeting professional (CMP) designation, which she did in 2006.
“MPI provides a link to other meeting professionals, as well as valuable resources to help me manage my ever-changing role in my organization,” she says.
“I am able to network with others in my profession, and keep apprised of what is happening in the industry in a way that works for me, whether it be a networking event, or, more often, the Web resources.”
Gunn says the current economic situation hasn’t changed her association with MPI; it is still a resource.
“MPI has provided important information and resources on how I can be more strategic in the support of my company from a meetings perspective,” she says.
Gunn adds that MPI also can help industry newcomers in this economy.
“I think there are fewer newcomers to the organization,” Gunn says. “With the current job market, it is becoming tougher to enter the industry, and as a result, fewer new members. These newcomers are vital to continue innovating and keeping the approaches ‘fresh.’”
Gunn says she wants to personally mentor newcomers in order to help them understand the opportunities MPI has to offer both personally and professionally. Gunn admits she didn’t take advantage of an MPI mentor when she was offered one, but she says she now knows that mentors are important.
“I would also like to see these new members aligned with mentors from their area of focus, so they can truly learn more about how to take the most advantage of the opportunities before them,” Gunn says.
Not only are newcomers an important part of MPI’s future, but so, too, is bringing together existing members, Gunn says. She says that a forum for members from all branches of the industry, from independent and corporate planners to suppliers, is something that would benefit all members.
“The more we understand each other’s roles, the better we can work together,” she says.
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.”
This week on AZNow.Biz, the University of Arizona’s McGuire Center for Entrepreneurship is making it easy for entrepreneurs and small business owners to expand their knowledge with three unique online certificate courses. Our personal finance columnist, Jacob Gold, writes about Americans putting more money into savings and how that benefits the economy. Plus, see some majestic views of the Grand Canyon in our Snap Shot feature.
The number of people working in construction is approaching a 14-year low now that the industry lost 21,000 jobs in September, while construction unemployment is at a September high of 17.2 percent, according to an analysis of federal employment figures released today by the Associated General Contractors of America.
The construction industry continues to suffer from declining investments in construction and broad uncertainty about the future of many federal infrastructure programs and tax rates, association officials noted.
“It has taken less than four years to erase a decade’s worth of job gains as the industry suffers from declining private, state and local construction demand,” said Ken Simonson, the association’s chief economist. “No other sector of the economy has suffered as much for as long as construction.”
Simonson noted that the 5.6 million people working in construction today is barely higher than the 5.59 million people who were working in construction in August 1996. He added that construction employment continued to lag behind other sectors of the economy. For example, while total private employment rose by 593,000 during the past 12 months, the construction industry lost 210,000 jobs. Meanwhile, the industry’s unemployment rate is nearly double the unadjusted national rate of 9.2 percent.
Most of September’s construction job losses came from the nonresidential sector as demand for commercial facilities and infrastructure projects remains weak, Simonson noted. Residential construction lost 2,500 jobs last month while nonresidential construction lost 18,100 jobs. Nonresidential specialty trade contractors were the hardest hit, having lost 19,500 jobs in September, the economist added.
Association officials noted that construction spending figures released late last month show private, state and local construction spending continues to decline. And while federal spending has increased, most of those investments have come from temporary programs like the stimulus and military base realignment programs.
While these temporary federal programs have helped the industry, many contractors are reluctant to expand payrolls while long-term federal programs that fund highway, transit, water system and aviation related construction remain in limbo, association officials said. They added that most contractors don’t even know what their tax rates will be for next year.
“Construction firms aren’t going to start hiring again until they can predict how busy they’ll be,” said Stephen E. Sandherr, the association’s chief executive officer. “Frankly it is hard for contractors to make any business decisions when they don’t know how much they’ll make or how much they’ll owe.”
Title: Arizona State President
Company: Bank of America
How would you assess the banking industry’s reactions to the new financial reform law? What are the industry’s biggest concerns, particularly in regards to derivatives and less onerous regulation on small banks?
Bank of America has generally supported reforms, including the formation of a new consumer protection agency. While this reform will ultimately have an effect on many businesses across Bank of America and other financial service companies, customers and clients should not expect any abrupt changes as a result of this legislation. The full impact and scope of the bill may take years to be felt, as regulators establish hundreds of new rules to implement the law.
The year 2009 was a tough one for Bank of America in terms of the federal bailout and executive shakeup. How has repaying the bailout and installing a new CEO affected the company’s operations and public image?
In December, Bank of America took a series of important actions to move our company forward. We repaid the entire $45 billion preferred stock investment provided under the Troubled Asset Relief Program (TARP), plus interest. A few days later, Brian Moynihan was selected to lead our company. He has a level of credibility and broad-based experience few can rival, having led every major line of business in financial services, including wealth management, corporate and investment banking, and consumer and small business banking.
As Arizona president for B of A, how have you — and your peers from other large banks — addressed the concerns Main Street has about Wall Street?
The industry understands that our well-being is interconnected with the health and vitality of the economy and the communities we serve. It is not in any companies’ interest to put profit over common sense. Nor is it in anyone’s interest to lose sight of the value our industry provides among legitimate concerns about the difficulties of the recent past. Our challenge for the foreseeable future — and I think we’re moving in the right direction — is to reconcile this and strengthen our financial system by working with leaders and regulators in a spirit of trust and goodwill.
In speaking for my own company, Bank of America has introduced clarity commitments within our card, deposit and mortgage services to make sure customers receive clear and easy to understand language about their relationship with our bank. In addition, our new overdraft fee changes went into effect July 1, whereby we will decline a debit card transaction at the point of sale when there is not enough money in the account for the transaction, and not charge overdraft fees to the customer.
Small businesses are having a difficult time getting loans and various lines of credit. B of A prides itself on its No. 1 SBA-lender status. How important is that role in the economic recovery?
With 4 million small businesses customers — more than any other bank — Bank of America feels a deep sense of responsibility to support them in every way possible. In the first half of 2010, we provided $45.5 billion in loans to small and medium-sized companies, well on our way to meeting our pledge to increase lending by $5 billion over 2009 levels, or $86.4 billion.
We continue to also look for creative ways to help these businesses bridge to a stronger economy. For example, we recently announced a new program that can help as many as 8,000 small businesses obtain $100 million in federal microloans through nonprofit lenders like CDFIs, by providing CDFIs with grants to cover loan loss reserves required to get the SBA/USDA loan capital. This is low-cost, long-term capital for small business microloans nationwide over the next 12 months.
What challenges and opportunities lie ahead for the banking industry in Arizona?
Arizona’s economy will probably be on a slower track than most states because of the significant losses in our housing and jobs markets. That being said, there are many bright spots to look forward to and we must continue to make every good loan we can and focus on opportunities that will help our long-term economic recovery …
- Has been with Bank of America for more than 30 years
- Responsible for the overall performance of all business banking activities in Arizona
- Graduate of Stanford University and Santa Clara University
- Member of the California State Bar Association
- Member of the U.S. District Court Northern District Association
- Member of the Greater Phoenix Leadership and Arizona Bankers Association
- Serves on the board of Phoenix Aviation and Teach for America
Vowing that “today the rubber hits the road,” Gov. Jan Brewer and Jerry Colangelo assembled and introduced 35 state leaders representing diverse backgrounds for the inaugural board meeting of the Arizona Commerce Authority.
The private-sector board will work to align diverse assets and opportunities within the state to compete economically in both domestic and international markets to create high-quality jobs for the Arizona residents.
“For the first time in our state’s history, we convene the Governor, the Speaker of the House and the Senate President, and more than 35 of our nation’s most acknowledged leaders within both the private sector and academia – all with one express purpose: to advance the global competitiveness of our state the economic prosperity we seek for each person, each family and, perhaps more importantly, each child – it’s about a vision for a strong, vibrant economic future for this great state,” Gov. Brewer said.
“When I became Governor, I promised to get Arizona back on track by creating quality jobs, attracting high-growth industries, and advancing our competitive position in the global economy. We are doing just that. With this board, I have now delivered a model to advance Arizona.”
Presentations to the board outlined the impacts of the global economic crisis on the state, the forecasts if Arizona does not address diversification and growth in base industries, the state’s overall global competitiveness, and a focused approach to four core areas on which the ACA will focus and develop a planned approach to advance the state.
The authority will focus on improving the state’s infrastructure and climate to retain, attract and grow high-tech and innovative companies. That focus will be on aerospace and defense, science and technology, solar and renewable energy, small business and entrepreneurship.
“During one of the most challenging economic conditions in our nation’s history, Arizona is competing for something that is even greater than Olympic Gold; we are fighting for the health and future of our families and this state,” said Colangelo, co-chair of the board. “Today, with the expertise and leadership of each board member, we begin to compete aggressively for what really matters.”
Don Cardon, current director of the Department of Commerce, will serve on a selection committee to recruit a president and CEO of the ACA. Other committee members are Gov. Brewer’s chief of staff Eileen Klein; Mo Stein, senior vice president of HKS; Jerry Fuentes, president, AT&T Arizona/New Mexico; and Michael Kennedy, co-founder and partner, Gallagher & Kennedy.
Other notable board members include Kirk Adams, speaker, Arizona House of Representatives; Benito Almanza, state president, Bank of America; Michael Bidwill, president, Arizona Cardinals; Dr. Michael Crow, president, Arizona State University; Linda Hunt, president, St. Joseph’s Hospital and Medical Center; Anne Mariucci, chairman, Arizona Board of Regents; Doug Pruitt, chairman and CEO, Sundt Construction; and Roy Vallee, chairman of the board and CEO, Avnet.
Despite some gains in the governmental sector, the state’s unemployment rate for August rose one-tenth of a percent to 9.7 percent as private sector hiring was flat, according to the Arizona Department of Commerce. Usually, Arizona’s economy generates jobs in August, but last month only 28,000 jobs were created. That was still better than August of 2009.
Most of the seasonal job gains were the result of local schools bringing on 26,000 positions for the start of the academic year. State education added 7,000 jobs, with losses in other government agencies offsetting some of the gains.
The private sector posted gains in five sectors and losses in five sectors for a net decline of 800 jobs. Of the state’s 11 industry sectors, government posted the largest job gains at 29,000. Educational and health services followed government, adding 3,000 jobs. Construction continued to add jobs in August, generating 1,900 and giving the industry a net gain through the first eight months of the year.
The Commerce Department reports that, “Construction employment trends in 2010 indicate stabilization in the industry after 28 months of continuous losses.”
Other sectors creating jobs in August were: professional and business services (1,800); trade, transportation and utilities (1,100); and natural resources and mining (100). The sectors that lost jobs last month were: information (500); financial activities (800); manufacturing (1,400); and other services (2,000).
Leisure and hospitality lost 4,000 jobs last month, which the Commerce Department called “unusual.” With the winter tourism season generally starting after Labor Day, hotels and resorts in the state traditionally tend to ramp up hiring in August.
Year-over-year, the jobless situation in Arizona continues to show improvement. Total nonfarm employment last month was down 0.1 percent. In August 2009, it was down 8.3 percent. Compared to August of last year, four sectors registered year-over-year job gains last month. The professional and business services sector was up 8,200 jobs; trade, transportation and utilities was up 7,700 jobs; educational and health services had a gain of 7,100 jobs: and natural resources and mining posted gains of 1,000.
Around the state, only the Phoenix and Tucson metro areas held steady with their unemployment rates. Other major metro areas in the state posted increases in joblessness. Here’s a look at unemployment around the state:
Phoenix Metro: 8.8%
Tucson Metro: 8.7%
Yuma Metro: 23.7%
Flagstaff Metro: 8.0%
Prescott Metro: 10.2%
LHC-Kingman Metro: 10.9%
Is it possible to build a sustainable suburb? The answer depends largely upon your perspective.
Of course, sustainability is a word freely associated these days with eco-friendly building materials, alternative energy and “living off the grid,” and is usually used in conjunction with the concepts of urban living, light-rail and transportation-oriented development. However, some of the first sustainable buildings were lovingly referred to as “land ships,” and built far from cities.
The deserts of Taos, N.M., for example, still host these forward-thinking renegade buildings dating back to the late 1960s and 1970s, and were colorfully branded by many as “crazy hippy stuff.” And certainly these buildings are a far cry from the buildings and locations we think of as locations of sustainable development today.
Arizona has long been associated with sprawl, and frankly it’s the reason why the sustainable movement has been slow to catch. However, with a struggling economy and real estate development virtually at a standstill, it’s important to think beyond our limited frame of reference. But the suburb? Can it really be sustainable? Our twin love affair with privacy and the automobile has made the suburb far from a likely place to orchestrate sustainability. Places where garages line streets instead of trees and retail buildings have walls around them virtually imposing a drive instead of a walk. But there is a sustainable sun on the horizon.
Arizona State University’s Stardust Resource Center has created a Growing Sustainable Communities Initiative, and its strategies for growing sustainable communities in the Valley of the Sun include:
- Promoting mixed land uses
- A range of housing types
- Thriving economies
- Environmentally responsive design
- Having a variety of transportation choices
- Compact development
- Making places safe
- Promoting healthy living
- Community engagement
I could write four pages about each of those points, but essentially they mean: building sustainably occurs block-by-block, street-by-street, house-by-house. It is an organic process and there is no cookie cutter, one-size-fits-all approach. In fact, the standard of cookie cutter replication is what has created much of the challenges in every community built after 1950 in Arizona.
To be successful, it is imperative that we change our standard “square mile” approach to development, where commercial businesses exist only on the edges and residential homes on the interior and there is virtually no interplay between them. No parks, and no tree-lined streets. A better strategy is to develop on the quarter-mile, where neighborhoods have work and play uses and schools and shopping centers interact with residential neighborhoods through a network of paths and pedestrian/bike connections — just like the village concepts of the historic neighborhoods built prior to the 1950s. Ask any Midwesterner what they miss about home and I’ll bet they say their “neighborhoods.” There’s a reason why.
What the sustainable movement is advocating is greater creativity on the developer side and less regulation and restrictions on the government side. Scott Carlin, an associate professor of geography at the C.W. Post Campus of Long Island University, makes an excellent case for a deeper theory of sustainability. He suggests we re-invigorate ties to cities and villages, by building new homes only where there are existing water and sewer lines, sidewalks, schools, businesses and the other infrastructure within a reasonably close radius. In other words, so we can get out of our cars and walk.
What about existing neighborhoods? Well, they can be re-imagined as sustainable by relaxing zoning code to allow for commercial uses consistent with vibrant neighborhoods and by resisting the status quo. It will also happen when residents advocate for and pursue the creation of public amenities like parks and pathways and tree-lined streets. Even the Urban Land Institute recognizes the opportunities suburbs represent because it’s where the biggest gains could be made. Still, it cautions that connecting the dots between suburban projects through effective sub-regional planning is essential.
It is possible for us to focus on more than buildings when we think of sustainability. With a bit of imagination, and the commitment to integrate the principles of sustainability even on the outskirts of town, we can succeed. Surprisingly, in fact, we won’t be creating anything new. Because, it’s when we look to the past and incorporate the best of what it means to live in an American neighborhood we win. Sustainability is certainly a look to the future, but its reality and its secrets are grounded in our American past.