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Cover, AZ Business Magazine

Jim Pederson And Jon Kyl Go Head To Head in Real Estate

The Blue Camp

Jim Pederson has built a real estate kingdom in the desert, but can he dethrone Jon Kyl?

By Lori K.Baker

It’s 4:30 on a sweltering August afternoon, and a cadre of small-business owners duck into Nixon’s, a Camelback Esplanade restaurant that pokes fun at politicians. They gather upstairs, a meeting spot that looks like the back room of a dimly lit Washington, D.C. bar. Quotations—both famous and infamous—are inscribed on the walls. Walls decked out in vintage newspaper and magazine covers flash back to the Watergate break-in, Nixon’s resignation, Kent State shootings and Lyndon Johnson’s announcement he wasn’t seeking re-election.

Jim Pederson, Jon Kyl - AZ Business Magazine Oct/Nov 2006Yes, those were troubling times. But these owners of small businesses—accounting firms, construction companies and automotive dealerships—aren’t enamored by the modern-day political scene, either. And U.S. Senate Democrat candidate Jim Pederson, whom they’ve come here to meet, is about to hear all about it during his one-hour campaign stop.

Dressed in a gray suit and french blue shirt sans tie, 64-year-old Jim Pederson listens intently, often nodding his head in agreement. The Democrat developer—sort of an oxymoron—tells the business owners he can relate to their struggles. He didn’t instantly strike it rich with the Pederson Group, the mastermind of more than 25 retail projects throughout the state, beginning with a neighborhood shopping center in Goodyear in 1986.

As the eldest of six boys, Pederson grew up in a 1,000-square-foot, two bedroom home on the south side of the railroad tracks in Casa Grande, where his father Ed, a diehard Republican, was city manager for 25 years. Ed instilled a passion for news, politics and public service in Jim, who attended the University of Arizona, where he earned his degree in political science and a master’s in public administration.

In 1967, fresh out of grad school, he moved to Phoenix, where he followed in his father’s footsteps by going to work for city government—first in the City of Phoenix’s research and budget division and later as administrative assistant for Phoenix Mayor Milt Graham. When Graham lost an election, Pederson was faced with a decision: Switch careers or return to Phoenix’s research and budget division. Then came a fortuitous meeting with shopping center magnate Sam Grossman, who hired Pederson to run the then-Christown Mall.

Afterward, Pederson was hired at Westcor, where he eventually wound up as manager for Westcor’s shopping centers before he ventured out on his own in 1983. He slowly built his development empire—making him a multimillionaire and making the state’s Democratic Party a benefactor of his largess.

After being elected as state chair of the Arizona Democratic Party in 2001, he infused millions of his own money into the party, set records for fund-raising.

But now he’s making his own high-stakes bid to unseat a two-term incumbent in one of the most watched races in the country. Pederson has poured millions of his own money into the campaign, largely to build name recognition in a state in which 90 percent of the people had never heard of him.

“The race between Senator Kyl and Jim Pederson may end up being one of the hottest senate races in the country,” says Bruce Merrill, a nationally known Arizona State University pollster who conducts monthly surveys. “Both candidates are competent, well managed and well financed,” he says.

On the campaign trail at a recent Kiwanis club meeting in Tempe, Pederson drives home the point that he’s looking out for the interests of the small businessman. “I bring a certain bias to the campaign, the bias of being a small businessman,” he says.

“You need to send someone back to Washington who is independent,” Pederson says, leaning forward on the podium. “Independent of special interests—and independent of partisanship.”

www.pederson2006.com

The Red Camp
Incumbent Republican Jon Kyl faces his strongest challenger yet.

Except for triple digit temperatures, it’s an idyllic day at Scottsdale’s posh Gainey Ranch. Sunlight glints on manmade lakes, which pose as water hazards on acres upon acres of rolling green golf courses. Chic eateries are doing brisk mid-day business. Doubletree Ranch Road, lined with towering date palms, winds past the Hyatt Regency Scottsdale, where guests can opt for de-aging wraps and mineral massages at Spa Avania.

Down the road from the resort, Sen. Jon Kyl blows into Scottsdale Insurance Company in the nick of time for this 2 p.m. meeting, looking hurried, yet composed. The Congressional Quarterly describes him as someone who “can frequently be seen racing through the Capitol—often to and from top leaders’ offices—never choosing a casual stroll.”

He’s keeping the same breakneck pace on this jam-packed, mid-summer day on the campaign trail in his hometown stomping ground. Today, security—namely national security—is on his mind as he addresses this standing-room-only crowd.

“One thing that is very much on my mind is that we are at war and yet it does not seem like we are,” Kyl begins. “This is a war against a group of evil people who believe they must bend everyone to their will or kill them. We need to support the policies that will deal with this threat in a serious, committed way.”

Kyl has been one of the Senate’s most consistent supporters of the Bush administration’s policies. Political observers like Arizona State University pollster Bruce Merrill notes party loyalty always comes into play during key election races.

“The president’s popularity has the potential to impact this race,” he predicts. Turmoil in the Middle East is the topic du jour for this crowd, which peppers Kyl with questions. “Are we willing to destroy Iran rather than allow them to have a nuclear program?” an attendee asks. Silence hangs in the air as the audience awaits Kyl’s response.

“That’s a good question and I don’t think we want to answer that yet,” replies Kyl, described by Congressional Quarterly as “someone who has taken to working behind the scenes much more readily than selling his position publicly.”

Another hot button around Arizona—and the Southwest for that matter—is immigration reform. The fact that Arizona’s two senators, John McCain and Kyl, have different views on immigration reform has left political observers scratching their heads.

McCain’s solution includes allowing illegal immigrants to apply for a three-year guest worker visa, which could be renewed once if they paid a $1,000 fine and passed a background check. After six years, if they demonstrated English proficiency and paid another $1,000 fine and back taxes, they could apply for permanent residency, the first step toward citizenship.

Jim Pederson, Jon Kyl - AZ Business Magazine Oct/Nov 2006Last year, Kyl co-sponsored a bill that provides for a guest-worker program but requires illegal immigrants to leave the United States—called “mandatory departure”—before they re-enter the United States and apply for it. Guest workers and new immigrant laborers can apply for a two-year visa that can be renewed twice, with a one-year gap between renewals that must be spent outside the United States and a lifetime cap of six years. The visa offers no special path to permanent residency or citizenship. The bill also doubles existing civil penalties for employers who hire illegal immigrants.

Back in Kyl’s office at 22nd Street and Camelback, a large photograph on display shows President Bush and Kyl in front of Old Glory, smiling for the camera. He chats about everything from fuel efficient cars to his energy policies, which include more domestic oil drilling as temporary solutions to the long-ranging fuel issue.

Unlike his counterpart, U.S. Senator and media-frequent, would-be presidential candidate John McCain, today’s conversation offers a rare glimpse of the more private Kyl. As Kyl told Time: “You can accomplish a lot if you’re not necessarily out in front on everything.”

www.jonkyl.com

Jim Pederson
Iraq war:
Calls Iraq war “the biggest policy failure in my lifetime” and says he would demand an exit strategy.Immigration reform:
Supports a guest worker program that would fine illegal immigrants and put them through a background check before qualifying.

Repeal of estate tax:
Opposes

Stem cell research:
Supports

Privatizing Social Security:
Opposes

Jon Kyl
Iraq war:
Vote with party officials against a timetable for redeploying troops out of Iraq.

Immigration reform:
Proposes “mandatory departure” of illegal immigrants and opposes automatic path to citizenship for guest workers.

Repeal of estate tax:
Supports

Stem cell research:
Opposes

Privatizing Social Security:
Supports

AZ Business Magazine Oct/Nov 2006

Public Policy

Hispanic Chamber Takes On Key Issues

Matters of Public Policy

Hispanic chamber takes
on key issues

 

From immigration reform to healthcare affordability, the Arizona Hispanic Chamber of Commerce is once again wading into the turbulent waters of public policy and its already tackling big issues. The chamber’s public policy committee became active again last September and its 25 members have been busy the past several months educating themselves on state and federal issues.

public_policy“As an arm of an organization that represents primarily small Hispanic businesses, the committee explores issues that affect chamber members on a daily basis and their ability to grow and thrive,” says Jessica Pacheco, committee chairwoman and chamber board member and treasurer. “Not all Hispanic small businesses view these issues the same. We have a lot of debate and dialogue.”

Immigration Reform
So far, the Hispanic chamber has let other chambers take the lead on immigration reform, but Pacheco says her committee has its opinions on one facet of this issue—penalties for employers who hire undocumented workers. The committee has no problem with employer sanctions as a concept but opposes them as a “stand-alone issue” outside the context of comprehensive immigration reform. In June, Gov. Janet Napolitano vetoed a House immigration bill that included employer penalties. Its membership favors comprehensive immigration reform and the Hispanic chamber prefers that Congress address this issue, Pacheco says. “I can’t imagine a more difficult business environment than with each state having its own immigration laws.”

Procurement Opportunities
This fall, the chamber plans to help Arizona launch a “disparity study” to demonstrate how the state awards contracts for goods and services. It wants small business to garner a more equitable share of state procurement dollars, possibly an additional 10 percent. The chamber teamed with a variety of organizations to raise funds to pay for the study. The U.S. Department of Transportation is expected to provide $450,000 and a like amount must be raised locally through a public-private partnership, according to Pacheco. The first meeting with local donors was slated for June 14.

Federal Estate Tax
“There is a misconception that the federal estate tax affects very wealthy Americans, but if you look at the structure of the tax, it really hurts small businesses, especially Hispanic small businesses where 90 percent of them are inherited by family,” Pacheco says. The chamber believes the tax should be eliminated and committee members are communicating with Arizona’s congressional delegation.

Healthcare Affordability
Every small business grapples with the cost of providing health insurance, Pacheco says. “We would like to see a reduction in the cost of health insurance plans offered in the small group market. We also want to increase the number of workers in small business that have health insurance.”

Tax Relief
AZ Business MagazineThe chamber supports tax relief for small business. It favors reduction in dividend and capital gains taxes and supports accelerated depreciation for equipment and software. “Software depreciation is critical because small businesses often have to purchase very expensive software for accounting and networking,” Pacheco says.

Access to Capital
The Small Business Administration provides considerable capital for small businesses and the chamber is keenly interested that the SBA continuing to receive adequate funding. “The SBA has been a great partner and we want to be sure our membership knows what is out there and available to them,” Pacheco says.

 

www.azhcc.com

 

Arizona Business Magazine Aug/Sept 2006

 

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