Crain's Cleveland Business

By JAY [email protected]

The Northeast Ohio constructionindustry soon may take a big stepforward in the long-running effortto increase the presence of minoritiesand women at building sites.

After more than a year of work,the Commission on Economic Inclu-sion is preparing to release a studythat will recommend as many as 10 “action steps” to bring morewomen and minorities onto areaconstruction sites as both workersand as subcontractors. The study

includes a plan for what are calledcommunity benefits agreements,or CBAs, that set hiring requirementsand offer developers incentives ifgoals are met.

The inclusion commission’s Aprile-newsletter said the study’s find-ings “have been presented to, and

affirmed by, leaders of all segmentsinvolved in the construction arena:public and private sectors, projectowners, construction companies,unions, economic inclusion orga-nizations, training programs andothers.”

Joe Roman, president and CEO

of the Greater Cleveland Partner-ship, parent organization of the inclusion commission, was reluc-tant to disclose details of the studyuntil it had been discussed with hisgroup’s leadership. He said lastThursday, May 3, he hoped to be

By JOEL [email protected]

As Positively Cleveland, the region’sconvention and visitors bureau, laysout this Wednesday a detailed mapfor its future, it will look to the recentpast of its downtown neighbor — theGreater Cleveland Sports Commis-sion — as a potential guide.

Positively Cleveland president andCEO David Gilbert — who in January2011 assumed that role in addition tothe same duties at the sports com-mission — said in a recent meetingwith Crain’s editorial board that Positively Cleveland would exploreowning and operating some of itsown meetings and conferences.

In creating its own events, Posi-tively Cleveland would follow the leadof the sports commission, which in2006 staged the first ContinentalCup, an annual international youth

$2.00/MAY 7 - 13, 2012

Entire contents © 2012 by Crain Communications Inc.

Vol. 33, No. 19

07447083781

719 SPECIAL SECTION

HIGHER EDUCATIONColleges’ add-on fees under more scrutiny ascosts to attend continue to rise ■■ 3PLUS: GROWING VETERAN ENROLLMENT ■■ & MORE

NEW

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Bioscience directory liveCrain’s first Bioscience Directory

of Northeast Ohio companies, produced with the help of BioOhio,provides information about compa-nies that are helping lead the statein a profound economic transforma-tion.

You can find the directory atwww.CrainsCleveland.com/sec-tion/bioscience.

ON THE WEB

Group aims to shape region’s image

BrandMusclewill move 150to downtown

CEO sees possibility to have impact greater than just luring visitors role in shaping “how Cleveland looks,acts and feels as a travel destina-tion.”

“We’re finally there, in terms ofrunning with a new vision of the organization,” Mr. Gilbert said in an interview with Crain’s editorialboard. “I honestly believe it is vastlydifferent than how the organizationwas run prior.”

He also will discuss plans for the

By JAY [email protected]

Next Monday, May 14, roulettewheels will start spinning at theHorseshoe Casino Cleveland. In thefall of 2013, the new ClevelandMedical Mart & Convention Centerwill open its doors.

In response, Positively Cleveland,

the local convention and visitorsbureau, is transforming itself by focusing not only on bringing con-ventioneers and tourists to North-east Ohio, but also on bolstering theeconomic impact of the region’shospitality business.

At Positively Cleveland’s annualmeeting, set for this Wednesday,May 9, president and CEO David

Gilbert, who has led for the groupfor 16 months, will unveil a five-yearstrategic plan for the organization.Instead of just promoting the city tomeeting planners and advertisingtourist attractions such as the Rockand Roll Hall of Fame and Museumin television markets outside the region, Mr. Gilbert said PositivelyCleveland intends to play a greater See FOCUS Page 7

See MOVE Page 6

See INCLUSION Page 18

See SPORTS Page 7

MARK STAHL PHOTOGRAPHY

Under-18 boys from the Internationals Soccer Club (blue), a team from Ohio, and Liberia FC (red) compete in the 2011Continental Cup.

Bureau mayhost eventsa la sportscommission

1100 Superior digs willoffer room to add staffBy CHUCK [email protected]

One of Northeast Ohio’s fastest-growing software companies is movingto downtown Cleveland.

BrandMuscle Inc. of Beachwoodis in the processof finalizing a leaseto take 40,000square feet at 1100Superior Ave.,which is on thesouthwest cornerof Superior andEast 12th Street.

The companytoday employs

more than 150 people at its head-quarters on Park East Drive inBeachwood. It plans to move all ofthem downtown before the end of2012, said BrandMuscle CEO PhilAlexander.

They’ll have a lot more leg room at1100 Superior, formerly known asthe Diamond Building. The newspace on the building’s fourth andfifth floors is 5,000 square feet bigger

Alexander

Early signs of economic inclusion group’s ‘action steps’ show promise

POSITIVELY CLEVELAND TO ANNOUNCE EXPANDED FOCUS

20120507-NEWS--1-NAT-CCI-CL_-- 5/4/2012 3:38 PM Page 1

State

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22 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM MAY 7 - 13, 2012

REGULAR FEATURES

Best of the Blogs ..19Big Issue ................8Classified..............18Editorial ..................8Going Places ........12Reporters’

Notebook ..........19What’s New ..........19

CORRECTIONAn April 30, Page One story that

described the availability of jobs in technicalprofessions misrepresented a statementmade by Ken Alfred, executive director ofthe Cleveland Engineering Society. Mr.Alfred said his daughter, who has an advanced engineering degree, is not having trouble finding a job in her field. Hesaid one of the major traditional employersof engineers in her niche is not hiring.

COMING NEXT WEEKHealth Care Heroes

Audit Bureauof Circulation

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Keith E. Crain: ChairmanRance Crain: PresidentMerrilee Crain: SecretaryMary Kay Crain: TreasurerWilliam A. Morrow: Executive vice president/operationsBrian D. Tucker: Vice presidentRobert C. Adams: Group vice president technology, circulation, manufacturingPaul Dalpiaz: Chief Information OfficerDave Kamis: Vice president/production & manufacturing

G.D. Crain Jr. Founder (1885-1973)Mrs. G.D. Crain Jr. Chairman (1911-1996)

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Publisher/editorial director:Brian D. Tucker ([email protected])Editor:Mark Dodosh ([email protected])Managing editor:Scott Suttell ([email protected])Sections editor: Amy Ann Stoessel ([email protected])Assistant editor: Joel Hammond ([email protected])SportsSenior reporter: Stan Bullard ([email protected])Real estate and constructionReporters: Jay Miller ([email protected])GovernmentChuck Soder ([email protected])TechnologyDan Shingler ([email protected])Energy, steel and automotiveTim Magaw ([email protected])Health care and educationMichelle Park ([email protected])FinanceGinger Christ ([email protected])Manufacturing, marketing and retailingResearch editor: Deborah W. Hillyer ([email protected])

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Crain’s once again will recognize and profile someof Northeast Ohio’s tophealth care professionals inthis annual section.

GOING THE RIGHT WAYOhio was one of 18 states that in March registered what the U.S. Bureau of Labor Statistics characterized as a “statistically significant decline” in unemploy-ment from a year ago. Ohio’s jobless rate in the past year has dropped by 1.3percentage points, to 7.5% in March 2012 from 8.8% in March 2011. Here’s alist of states in which unemployment has fallen by at least 1 percentage point:

Unemployment Unemployment PercentageMarch 2012 March 2011 change

Alabama 7.3% 9.3% -2.0%

Michigan 8.5 10.5 -2.0

Florida 9.0 10.7 -1.7

Nevada 12.0 13.6 -1.6

South Carolina 8.9 10.4 -1.5

Tennessee 7.9 9.4 -1.5

Connecticut 7.7 9.1 -1.4

Ohio 7.5 8.8 -1.3


“People like to rag on China and say China sucks —China has made my company possible.” – Scott Colosimo, founder, Cleveland CycleWerks

By DAN [email protected]

Wouldn’t you just know it —Ohio strikes gas and within monthsthe price of the stuff plummets.

A year ago, this newspaper wasrunning its first stories about Ohio’spotential shale gas industry. At thetime, natural gas was selling formore than $4 per thousand cubicfeet (MCF).

Since then, billions of dollars havebeen spent by drillers to securemineral rights in Ohio’s Utica shaleregion. But though the state hasbeen abuzz with activity as drillingrigs move in, natural gas recently hasbeen selling for around $2 per MCF

and many worry the price will fallfurther.

Just how the price drop will affectthe industry’s development in Ohioremains to be seen. However, what’scertain is that the falling prices arenot welcome by drillers, by land-owners waiting for royalties fromthe sale of gas extracted from theirproperties or by the state, which isanticipating an influx of badly neededtax revenue in its coffers.

Low gas prices are the talk of theindustry not just here, but acrossthe country, and it’s a situationthat’s likely to get worse before itgets better, say some experts.

“That’s all anyone in the industry

a new satellite campus inNorth Ridgeville.

“There are some facili-ties that are just unique tohaving a reputable, high-quality collegiate environ-ment,” Dr. Church said.

Enrollment at the collegehad been on an upwardtrajectory from 1999 until

2010 as the number of students dou-bled to 13,685 from 6,773. Enroll-ment, however, fell in 2011 to 13,146.

Dr. Church said he expects enroll-ment numbers to “soften a bit” over

the next five to eight years becausethe number of students graduatinghigh school in the region continuesto decline in the wake of demo-graphic shifts.

Still, Dr. Church said the region’ssteady transition from a traditionalmanufacturing economy couldcontinue to nudge enrollmentnumbers upward as workers look toenhance their skill sets — some-thing that has been a main driverfor the college’s growth over the lastfew years.

MAY 7 - 13, 2012 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 3

INSIGHT

THE WEEK IN QUOTES

At long last, LCCC invests to accommodate its decade of growth

“We set out to build aprogram that wouldhonestly give some-thing back from theuniversity perspective... in recognition of theirservice to our country.”— Eric Patterson, director of Veteran Affairs, John Carroll University. Page 13

“A fresh set of eyes onleasing, propertymanagement andconstruction can behelpful.”— Jim Clark, senior vice presi-dent, Duke Realty Corp. Page 10

“We’re finally there, interms of running witha new vision of the organization. I hon-estly believe it is vastlydifferent than howthe organization wasrun prior.”— David Gilbert, president and CEO,Positively Cleveland. Page One

$65 million in projects will help relieve overpopulated campus

See LCCC Page 17

See PRICES Page 9

By TIMOTHY [email protected]

Lorain County Community College has stomached more than adecade of enrollment growth butuntil recently has invested little inexpanding its facilities to accom-modate hordes of new students.

That’s changing.The community college based in

Elyria is in the midst of a roughly

$65 million construction and reno-vation program to expand its reachin Lorain County and to modernizean aging campus that was built for6,600 students but now serves morethan 13,000.

The college’s latest — and mostexpensive — project is a $21.5 million,50,843-square-foot science buildingexpected to break ground this month.The new building will house class-room and lab space and will be the

last major project for theforeseeable future, ac-cording to Roy Church, whohas served as the college’spresident since 1987.

About $40 million ofother projects already areunder way. Last year, the universityinvested $17.5 million to renovateits old library, $12.5 million in a newculinary arts and convergent digitalarts building, and $12.5 million for

Stakeholdersfearing naturalgas price’s floorOversupply situation could have unwelcomeeffects on drillers, landowners and the state

Church

“We try to be fair. …In order to maintainthat low tuition, wesometimes need toadd on an applicablefee. It seems to be theright thing to do.”— Karen Miller, vice president of enrollment management andstudent affairs, Cuyahoga Com-munity College. Page 13

MARC GOLUB

Cleveland CycleWerks’ Scott Colosimo at his Cleveland Heights home

CYCLES’ FULL-CIRCLE RIDECleveland entrepreneur, originally shunned stateside,

started in China — but now plans to produce bikes back home

By DAN [email protected]

Scott Colosimo says people who hate him formaking motorcycles inChina can stop sending

him nasty emails like the one thatread, “I hope your bike blows upand kills you,” because later thisyear he’s going to start makingmotorcycles in Cleveland at hiscompany, Cleveland CycleWerks.

But to build inexpensive bikesthe way he wanted — most of hismodels cost about $3,200 — heneeded to start in China, he said.

“I’ve always wanted to makebikes here,” Mr. Colosimo insists.

Since it began shipping bikes in2009, CycleWerks has sold 9,000of them, all designed by Mr.Colosimo and his company butbuilt by contract manufacturersin China.

He tried to build bikes in Cleve-land, he said, but he was not ableto do it. Now he’s going to tryagain.

He has bought a closed,60,000-square-foot factory onWest 65th Street in Cleveland toserve as the company’s U.S.headquarters and plant. It’s anuncharacteristic investment forMr. Colosimo.

See CYCLES Page 17



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Volume 33, Number 19 Crain’s Cleveland Busi-ness (ISSN 0197-2375) is published weekly, exceptfor combined issues on the fourth week of May andfifth week of May, the fourth week of June and firstweek of July, the third week of December and fourthweek of December at 700 West St. Clair Ave., Suite310, Cleveland, OH 44113-1230. Copyright © 2012by Crain Communications Inc. Periodicals postagepaid at Cleveland, Ohio, and at additional mailing of-fices. Price per copy: $2.00. POSTMASTER: Sendaddress changes to Crain’s Cleveland Business,Circulation Department, 1155 Gratiot Avenue, Detroit,Michigan 48207-2912. 1-877-824-9373.

REPRINT INFORMATION: 800-290-5460 Ext. 136

By STAN [email protected]

Alexander Mann Solutions Corp.,a global provider of personnel services, is recruiting for two jobs atwhat could grow to a 300-personCleveland office that it is working toestablish with the help of state andlocal officials.

The company, the New York-based U.S. unit of Alexander Mann

Staffing firm starts staffing upconfident about the city’s chances toland the office, but would not popopen the champagne to celebrate awin until they get word formally —and directly — from AlexanderMann.

Michael Deemer, a DowntownCleveland Alliance vice presidentwho focuses on luring businesses tothe city center, said he consideredthe online job postings “a positiveindicator for Cleveland” and hewould continue advocating for adowntown location over other cityalternatives.

Mr. Deemer confirmed that the alliance has worked jointly with thecity, business attraction group TeamNEO and others to bring AlexanderMann to the city. Chris Warren, chiefof regional development for the cityof Cleveland, said the company isconsidering “multiple opportunities”within employment hubs inside thecity limits. He declined to elaborateon them or the company’s quest, butnoted he believes the companywould use Cleveland as a base forMidwest operations.

Competition is stiff for the jobsAlexander Mann could bring.

The Ohio Tax Credit Authority onMonday, April 30, approved a 65%,eight-year job creation tax credit forAlexander Mann. Cleveland is com-peting with North Carolina andMichigan for the project, accordingto a memo provided by the Ohio Department of Development afterthe tax credit was approved. Thestate said the company also could locate the added jobs at existing operations in Poland and the Philip-pines.

Big promisesThe state estimates the project

could net as many as 300 jobs and apayroll of almost $13 million annu-ally within three years of the openingof the office.

AMS, as the company refers to itself, provides outsourced recruit-ment and human resources services,such as identifying, interviewing andplacing candidates. It also placescontract workers.

Alexander Mann was launched in1996 and has a staff of more than1,500 employees in more than 60countries. The state noted the jobs atthe proposed office would includeadministrative and human resourcesstaff for Alexander Mann itself.

The company could add a signifi-cant tenant to the city’s core or anoutlying neighborhood business district. If the company reaches thestate’s 300 full-time job estimate, itwould require more than 50,000square feet of office space.

A February 2011 article in Work-force Management, a Crain’s sisterpublication, noted that companiessuch as Alexander Mann are in demand as the economy reboundsbecause corporations slashed staffwith recruiting skills in the lastdownturn. ■

Solutions Ltd. of London, had postingslast Friday morning, May 4, on theLinkedIn social networking site for ajob for a recruiter and another for anadministrative assistant to scheduleand coordinate interviews, both atan office in Cleveland.

Mark Milner, interim marketinghead at Alexander Mann, said in anemail Friday afternoon that he couldconfirm the company “will be extending our global footprint toCleveland.” However, he said hewould not discuss a potential Cleve-land office in detail or the company’sreasons for choosing Cleveland untilJune “for commercial reasons.”

Local business attraction expertsinterviewed earlier in the week were

Alexander Manncould employ 300here, state estimates


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Crain’s publisher to receive SPJ distinguished service awardCrain’s Cleveland Business pub-

lisher and editorial director BrianTucker and longtime public rela-tions executive Tony Kozlowski willreceive the Society of ProfessionalJournalists Distinguished ServiceAward.

They will be honored for theircontributions to excellence in jour-nalism and for their service to theCleveland chapter of SPJ. Both menare past presidents of the journal-ism society.

The awards will be presented at a

June 13 luncheon at theCity Club of Clevelandalong with a yet-to-be-announced student winnerof the four-year Phillip W.Porter Scholarship.

A graduate of Kent StateUniversity, Mr. Tuckerjoined Crain’s as editor in1985 from The AssociatedPress, where he had been assistantbureau chief of the news service’s60-person Los Angeles bureau. Hebegan his career in journalism

as a part-time sportswriterat the Ashtabula Star Bea-con and the ConneautNews Herald, in his home-town.

Mr. Tucker earned somenotoriety — and respect —in the news business whenhe and several colleaguesresigned their reporting

jobs at the daily Mining Journalin Marquette, Mich., in 1977. The reporters quit after their publisher,John McGoff of Panax Corp., fired

the editors of two of his newspa-pers, including the editor of theMining Journal, when they refusedto publish a biased and untrue articleabout President Jimmy Carter andhis wife.

Keith Crain, chairman of CrainCommunications Inc., applaudedthe award to Mr. Tucker.

“Brian Tucker is the consummatejournalist,” Mr. Crain said. “Althoughhe may now carry the title of publisher, he is and always will be areporter at heart.”

Mr. Kozlowski for many yearswas a public relations executivewith Standard Oil Co. (Ohio) and itssuccessor, BP America Inc. He hasplayed a leading role in managingthe annual “Best of Ohio” journalismawards sponsored by the Cleve-land, Cincinnati and Columbuschapters of SPJ.

The luncheon will be at the CityClub at 850 Euclid Ave. at noon. Ad-mission is $25. For more informationor reservations, go online at http://spjdsa2012.eventbrite.com. ■

than the company’s current head-quarters, and BrandMuscle will havethe option to take another 10,000square feet on the fourth floor.

Should it need even more space,BrandMuscle would work withbuilding owner American LandmarkProperties Ltd. of Skokie, Ill., to expand within the building, Mr.Alexander said.

The ability to expand continu-ously without moving was one reasonBrandMuscle decided to movedowntown, Mr. Alexander said. Thecompany, which sells software thathelps businesses customize mar-keting materials for local audiences,has more than doubled the size ofits staff over the past four years.

Another reason is that Brand-

Muscle employs a lot of young people who like the idea of workingin the heart of Cleveland, he said.

“We had a lot of people lobbyingfor downtown,” he said.

The company also considered locations in Beachwood, Indepen-dence, Mayfield Heights and Solon.

The city of Cleveland offeredBrandMuscle financial incentivesto encourage the company to movedowntown, Mr. Alexander said.Neither he nor a spokeswoman forthe city of Cleveland would providedetails about the offer.

Mayor makes his pitchThe move is a big win for the city

of Cleveland, given the company’ssize, growth trajectory and youngemployee base, which might be

inclined to live downtown, saidMichael Deemer, vice president of business development for theDowntown Cleveland Alliance.

“It’s a creative, technology-oriented firm with a younger workforce,” he said.

The alliance, which works to promote and improve downtownCleveland, helped recruit Brand-Muscle to the city, as did the city itself, Mr. Deemer said. He notedthat Mayor Frank Jackson spokewith Mr. Alexander near the end of BrandMuscle’s site search to encourage the company to makethe move.

American Landmark Propertiesand real estate services firm JonesLang LaSalle, which representedBrandMuscle, helped make the

Move: Young workers should boost city

Tucker

continued from PAGE 1

planned move downtown happenas well, Mr. Deemer said.

The move is just the latest in a series of big developments in down-town Cleveland, which soon willhave a casino, a new conventioncenter and a redeveloped East Bankof the Flats, said Rob Roe, managingdirector with Jones Lang LaSalle.

The addition of a fast-growingsoftware company to the mix shouldgive the city a big boost, he said.

“That’s certainly where our econ-omy is headed,” Mr. Roe said.

Following Rosetta’s footstepsCleveland’s gain is Beachwood’s

loss. The eastern suburb did not haveavailable space that met Brand-Muscle’s needs, said Beachwoodeconomic development directorJim Doutt. The city of Beachwoodtried to work with the owner ofBrandMuscle’s current headquartersat 3750 Park East Drive to help

expand the building, but in the endthe plan didn’t work out, accordingto Mr. Doutt, who wouldn’t saywhether Beachwood offered financialassistance to help the owner expandthe building.

“We’re very sorry to lose thiscompany,” Mr. Doutt said.

BrandMuscle, which this year wasacquired by Cleveland private equityfirm The Riverside Co., will becomethe second high-tech company tomove from Park East Drive to down-town Cleveland over the past few years.

Rosetta Marketing Group LLC of Hamilton, N.J., in 2010 startedmoving about 400 employees frommultiple Northeast Ohio offices intoa single office at 629 Euclid Ave.,formerly known as the National CityBank Building. The interactive mar-keting firm’s largest local office wasat 3700 Park East Drive, which isnext door to BrandMuscle’s currentheadquarters. ■


organization to generate its ownrevenue by creating and staging itsown events here. (See related story,Page One.)

Wary of a letdown after, as Mr.Gilbert put it, “the luster wears offthe shiny new toys” — the casino,the convention center and a raft ofnew or refurbished hotels — the organization will work on multiplefronts to advance the region’s traveland tourism prospects.

Mr. Gilbert said he expects to retainthe controversial and sometimesconfusing Positively Cleveland namefor the organization. But he intendsto attach a brand name to the areaas a tourist destination, a la “I LoveNew York.”

“Right now, we don’t have a brandthat’s been tested that speaks to visitors,” he said. “Whatever brand

comes out of this, we have to live itas a community.”

Positively Cleveland also is takingon the role of making it easier forvisitors to find their way around.

The organization is working tocreate a unified system of signage tohelp people easily travel from theairport to downtown Cleveland to Lakewood and Coventry and beyond. He expects what is calledwayfinding signage to answer suchquestions as, “How do you get to(and through) University Circle?”

To help incoming tourists, and toboost traffic at local hotspots, theorganization has installed softwareon its website that will give visitorsa one-stop place to buy their airlinetickets, reserve a rental car, maketheir hotel reservations and buytickets to the various museums inthe market.


THERE’S STILL TIME TO ADVERTISEBe a part of this special bi-annual edition, contact Nicole Mastrangelo: 216-771-5158 or [email protected]

WHO’sIN NORTHEAST OHIO

WHO150 Names You Should Know

?sports festival that until 2010 fea-tured only soccer. The sports com-mission early on lured legendaryItalian soccer team AC Milan to beits partner, and in 2011 the soccerevent drew nearly 160 teams fromeight states and Brazil, Bermuda,Canada and Colombia.

Now, Mr. Gilbert, as part of Posi-tively Cleveland’s latest strategicplan, wants to identify similar oppor-tunities on the meetings and eventsside. He said the organization has theknow-how to operate events, thoughhe was quick to add, “We’re not trying to replicate what someoneelse is doing.

“We want to identify potentialniches in the market,” Mr. Gilbertsaid. “If Cleveland has a critical massin an area,” Positively Cleveland willconsider that area for its event potential, he said. He mentionedurban farming specifically as anarea that Positively Cleveland couldtarget for a conference or meeting itcould stage.

Honing their craftMr. Gilbert said in a 2010 Crain’s

story that the sports commission“lost its shirt” on the ContinentalCup in its first year, but it slowly hasbuilt the soccer portion of the sportsfestival and has expanded it to othersports. Youth basketball and base-ball components, sponsored by theCleveland Cavaliers and ClevelandIndians, are part of it today.

Another proprietary event createdby the sports commission is theCleveland Classic, a football gameat Cleveland Browns Stadium eachfall featuring historically black colleges and universities.

Mr. Gilbert has touted the sportscommission’s ability to make improvements year after year to theevents it stages, something it’s unable to do with so-called “one-off” events such as the 2007 NCAAWomen’s Final Four and next sum-mer’s Senior Games, which it doesnot control. Those one-off eventsalso require substantial bidding feesthat take a chunk out of the group’soperating budget, which ranges from$2 million to $2.5 million annually.

The Continental Cup, on the other hand, requires no bidding

fees, and now is a profit generatorfor the sports commission.

Grow your own fundsIf Positively Cleveland was to

develop similar revenue-generatingevents, it would have even moremoney to market the region. Thegroup’s $8.5 million budget comesalmost exclusively from the county’s4.5% tax on hotel rooms; a chunk ofthat $8.5 million goes to MMPI Inc.,the Chicago-based developer of theCleveland Medical Mart & Conven-tion Center.

Sports commissions nationwideare going the create-your-own-eventsroute, said Don Schumacher, presi-dent of the Cincinnati-based NationalAssociation of Sports Commissions,which named the Continental Cupthe Outstanding Locally CreatedEvent in 2010 and 2011. This year,the sports commission expects 4,000athletes to descend on the regionfor the four-day event, which shouldhave an economic impact of $3 mil-lion.

Mr. Schumacher specifically citeda group called the Richmond (Va.)Sports Backers, the budget of whichnow exceeds that of the RichmondMetropolitan Convention and VisitorsBureau, thanks to revenues gener-ated from the Backers’ own events.

“It’s a trend that’s going to con-tinue,” Mr. Schumacher said. “Cleve-land is among the cities that learneda long time ago that if you createthese events, you create revenues.” ■



Sports: Niche marketscould be ripe for events

Focus: Bustle of new activity provides right climate for shift ‘Boom’ times

On a more operational level, theorganization has been greatly restruc-tured. Mr. Gilbert said of the ninetop executives in the organization,six have joined in the last 16months. He said his new team nowwill be figuring out how best to adaptto what Mr. Gilbert believes is amore attractive convention andtourist city. He bases that forecaston more than the casino and newconvention center, which is underconstruction.

“We’ve got a boom going on thatI think is unlike anything going onin the country,” he said, ticking offthe new Greater Cleveland Aquariumand Museum of Contemporary Art,the renovated Cleveland Museumof Art and what he estimates is $200million in new hotel development.

Those developments, he said,have caught the eye of meetingplanners who come to scout thetown as a future convention site.

But that boom could raise hotelrates to a point where Cleveland ispriced out of the range of some ofthe social, fraternal and military organizations that have been thecity’s bread-and-butter conventionsin recent years. Avoiding that situa-

tion will require a more strategicmarketing effort.

“If you asked what conventionswe have been going after (in thepast), it would be everything andanything,” Mr. Gilbert said. “Youcan’t do that in this business.”

So, Mr. Gilbert intends for Posi-tively Cleveland to develop a focusedstrategy once the casino and con-vention center up and running.MMPI Inc., the Chicago developerthat will run the convention centerand medical mart, will book medicaland health care conventions. Posi-tively Cleveland will handle the rest.

“We have to find the importantmarkets,” Mr. Gilbert said.

Cleveland: tourism centralOne longtime destination mar-

keter thinks Positively Cleveland ismaking the right move at an oppor-tune time.

“Being out there with any kind ofnew campaign right now can onlybenefit Cleveland,” said CristyneNicholas, who was happy to havethe “I Love New York” tagline workingfor her when she was CEO of NYC &Co., New York City’s tourism mar-keting organization.

“CVBs that are flexible and under-stand the changing dynamics will

be the ones that succeed,” Ms.Nicholas said of convention andvisitors bureaus nationwide.

Ms. Nicholas, who now is CEO ofNicholas & Lence Communications,a communications firm, said citiessuch as Cleveland within drivingrange of large populations can benefit as high gasoline prices havetravelers looking closer to home.

Mr. Gilbert’s plan also has beenwell-received by members of hisboard of directors, who have livedthrough the hard times without aviable convention center.

“David Gilbert is doing an out-standing job,” said Rachel Talton,CEO of Synergy Marketing Strategy& Research Inc. of Fairlawn. “Theorganization has transformed itselfto capitalize on Cleveland as atourist destination.”

Jon Pinney, a partner with Cleve-land’s Kohrman, Jackson & Krantzlaw firm who has been on the Positively Cleveland board for sevenyears, said he believes the brandingeffort rightly will be a big focus inthe months ahead.

“I’m extraordinarily excited aboutthe new direction,” Mr. Pinney said.“I believe the restaffing and otherchanges (Mr. Gilbert) has made areworking.” ■

MARK STAHL PHOTOGRAPHY

Action at last year’s Continental Cupbaseball tournament


Last week, as I watched a local early-morning television newsshow, I almost laughed out loudat the coverage of the “news” that

the city was pulling down the PublicSquare tents of the Occupy Clevelandprotesters.

Breathlessly, the reporter spoke at lengthabout how gentle the policewere and that they’d let the pro-testers have their moment to takepictures, or whatever, beforethe aluminum pole and plasticsheet contraption was dismantled.

I am full of conflicted emotionsabout this story. On one hand,I’m glad the police weren’t heavyhanded — and some mighthave been — in their handlingof this because nobody neededany reason to be hot-headed. Score onefor Cleveland’s finest.

And I assume that the Jackson admin-istration had some hand in planning thisclean-up of the city’s treasured center ina peaceful, orderly manner. Good work,if my assumption is accurate.

We are approaching the opening of

Ohio’s first legalized casino, just a couplehundred yards, or less, from the protestsite. The downtown area has been waitinga long time for something new to cele-brate, other than last summer’s arrival ofthe cast, filmmakers and crew of “TheAvengers,” and it’s important to havePublic Square dressed up and ready to

go.Now, dear reader, don’t get

me confused with the folks whoderided the Occupy movementas little more than the usualcast of anarchists and full-timeprotesters who show up forevery cause. As I have writtenbefore, these people representeda cross-section of America, andthey were more than entitled toexpress their disdain for the

greed that nearly killed our economy.And I agree that people should be

allowed to protest and criticize as muchas they want, but they need to do it in afashion that doesn’t turn our streets intoa campground.

****CONSTRUCTION PROGRESSES APACE

on our new convention center and itsadjacent medical mart, and I, for one,am excited.

When it opens, will it be exactly as itwas proposed when the county commis-sioners agreed to impose the tax that financed its construction? No, but theentire world is different than it was backthen. For example, we no longer havecounty commissioners, but that had lessto do with this project than the greedand abuse of power of one of them.

With a new advisory task force in place,and the hiring of former McKinsey execJim Bennett, the project is in better handsthan ever. More importantly, we will final-ly have a convention center to help drivebusiness to our hotels and restaurants.

There is no way that ever happenswithout a med mart-convention centerplan that appealed strongly enough tothe commissioners that they summonedthe political will to impose a tax to get itbuilt. They eventually were driven fromoffice by a reform of the entire govern-mental system, but on that project theydeserve the thanks of all of GreaterCleveland. ■


Too badS

ome charter school operators aren’t happythat the Cleveland Metropolitan School District’s transformation plan would give apublic-private watchdog panel a say over

which charter schools in Cleveland would receivemoney from the district’s operating levy and whichones would not.

Our response to their lament? That’s too bad.The existence of the Transformation Alliance, as

the panel is known, is essential to the success of theSchool Transformation Plan pushed by ClevelandMayor Frank Jackson, who oversees the district, andschools CEO Eric Gordon. Without the alliance, thetransformation plan would be ineffective because ofits reliance on quality charter schools to share theload with the district’s own schools in providing asound education to young people in Cleveland.

The alliance would be composed of parents, educators, business people and other civic leaderswho would evaluate district and charter schools usingcommon performance standards. It would recom-mend which schools should be supported andwhich should be closed or cut off from public money.The district’s central office then could direct resourcesto the best schools and could close failing ones.

The quality assurance role the alliance would playis important in light of Mayor Jackson’s plan to askCleveland residents this fall to raise the school district’s operating levy. Under the transformationplan, charter schools would be eligible for moneygenerated by the tax. For voters to say “yes” to a levyincrease, they’d need to know that the added dollarswouldn’t be wasted on charter schools with poor tomediocre performance track records.

And there are good charter schools worthy of voters’ support. Among them are three of theschools — Entrepreneurship Preparatory School(better known as E Prep), Citizens Academy and Intergenerational School — that come under theumbrella of Breakthrough Schools. All three are rated excellent or better on the state’s report card.They are model schools that could serve as proto-types for replication in the district.

Breakthrough Schools will have a role in theTransformation Alliance, leading some charterschool operators to worry that it will use its influ-ence to block them from opening new schools. Webelieve their concerns are misplaced.

The people behind Breakthrough are all about delivering a quality education to as many Clevelandstudents as possible. If charter operators that aren’tin the Breakthrough realm have proven they can dothe job, then we’ve little doubt they’ll be welcome to join in the cause of teaching the city’s young people to the extent that the operators’ finances andresources merit.

State Rep. Sandra Williams, a Democrat fromCleveland who is co-sponsoring the House versionof the bill that would clear the way for implementa-tion of the transformation plan, is right when shesays, “The Transformation Alliance is definitely nec-essary in order for the bad charter schools to stopopening up in our district.” It’s also needed to stoplousy existing schools from ruining children’s lives.We wholly support the concept.

FROM THE PUBLISHER

BRIANTUCKER

Occupy Cleveland occupies thoughts

PUBLISHER/EDITORIAL DIRECTOR:Brian D.Tucker ([email protected])

EDITOR:Mark Dodosh ([email protected])

MANAGING EDITOR:Scott Suttell ([email protected])

OPINION

CAMERON ORRPainesvilleI have a daughter who justgraduated and she is lookingfor a job in Northeast Ohio, soit’s close to my heart.

➤➤➤➤ Watch more people weigh in by visiting the Multimedia section at www.CrainsCleveland.com.

THE BIG ISSUE

KRIS HOCEVAREuclidMy wife and I were talkingabout that last night. The cityis definitely growing, and hopefully in 21 years there willbe good things happening andmy son (now 18 months old)can take advantage of them.

STEVEN CRAIGPeninsulaWhat’s not here? NortheastOhio’s got enough of every-thing that any city has.

STEVE CORCORANBay VillageThis is a great city to meetpeople and build relationships.We have emerging businesses.

If your son or daughter was graduating from college and ready to look for a job do you think Northeast Ohio wouldbe a good place to start his or her career?



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VEHICLE MAINTENANCE FACILITY

ever thinks about, is the price ofgas,” said G. Allen Brooks, a Houston-based energy consultant, former securities analysts and author of theindustry blog, “Musings from theOil Patch.”

“Obviously, prices are a lot worsetoday than people thought they wouldbe six, nine or 12 months ago,” Mr.Brooks said. “No one really antici-pated we’d get to sub-$2. Now,we’re getting projections of a buckand a half, and people are asking, ‘Is$1 (per MCF) even the bottom?’”

If you’re curious, it’s probablynot, according to Mr. Brooks: Hebelieves gas could be all but givenaway later this year, especially if thenation’s natural gas storage facili-ties reach capacity as expected thissummer.

“I wouldn’t be surprised to seetrades this summer, out of storage,where gas goes for pennies,” he said.

‘It’s ugly’The culprit is the industry itself,

not to mention the shale beds beneath Oklahoma, Pennsylvania,Texas and other states that recentlyhave been helping drillers producemore natural gas than the nationcan burn.

“It’s ugly,” succinctly states JerryJames, president of the Ohio Oil andGas Association and also presidentof Artex Oil Co., a drilling and pro-duction company based in Marietta.

Mr. James’ company does not drillthe horizontal fracking wells thathave become synonymous withshale gas and oil; those wells, costing$3 million to $10 million each, are the purview of bigger, nationalcompanies.

Instead, Artex drills deep verticalwells — deeper than the conven-tional wells seen in Ohio, but not as complicated as a horizontallyfracked well. But it’s all the same atthe wellhead — and low prices,combined with the fear of highertaxes in Ohio, have caused Artex tohalt its drilling.

For nine years, Artex had leased a drilling rig and crew and kept itoperating almost continually, Mr.James said, drilling more than 200Ohio wells in the process. In Janu-ary, however, it stopped drilling andsent the rig back.

Unlike some of the newcomers toOhio’s oil and gas industry, Artexlargely has mature mineral rightsleases, including many where it already is producing gas and oil. It haspaid some leaseholders to extendtheir leases, but it isn’t under thepressure to keep drilling the waysome other companies are becauseit has production already taking placethat will hold its sites, Mr. James said.

Artex still is producing gas fromthe approximately 600 wells it ownsin Ohio, but as prices have continued

to drop, there’s a temptation to shutdown those wells and wait for higher prices.

“We have not crossed that pointyet, but it has occurred to us,” Mr.James said.

But just because Artex and someother drillers might be slowing downdoesn’t mean the state isn’t going tosee a ramping up of activity thisyear.

Sticking with the planExperts say Ohio actually might

see more activity in light of low gasprices. That’s because, unlike muchof the shale beneath Pennsylvaniaand some other states, Ohio’s shale contains “wet gas,” meaning itholds feedstock materials such asbutane, ethane and other liquidsused by makers of chemicals andplastics that now are more valuablethan the natural gas itself.

Those liquids are the only thingsthat make drilling profitable in thecurrent market, experts say, becauseit costs more to drill a gas well thanthe gas proceeds now can return ina reasonable period of time.

The state’s largest driller, Okla-homa-based Chesapeake Energy,said it intends to continue movingmore drilling rigs into Ohio, evenwhile it slows down drilling in otherdry gas areas and even slows downproduction generally. In January,Chesapeake said it was cutting itsproduction by 8% in an effort tohelp buoy natural gas prices, butalso would begin moving rigs from“dry” gas areas such as Pennsylvaniainto Ohio.

That’s still the plan, according toChesapeake spokesman Pete Ken-worthy.

“We stated in the (January news)release that the plan for the rig reduction would happen in the second quarter of 2012, which juststarted two weeks ago,” Mr. Ken-worthy said in an April 17 interview.“We are in the process of followingthe plan that was laid out in the release.”

Prices must firm, or else …Over the long haul, though,

Chesapeake and other drillers wantto see natural gas prices rise —though when that will happen isanyone’s guess.

Efforts to get significantly moreU.S. vehicles running on natural gasor to export it to other nations in liquid form are probably yearsaway, say experts and companiesinvolved in those efforts. New elec-tric generation plants that will runon natural gas are planned, but

those, too, will take a long time tobring on line.

In the meantime, the energy industry is bracing for further pricedrops this summer, hoping for atleast a normally cold winter in theUnited States, and watching the production numbers for any signthat the glut of supply will abate.

Few if any observers think priceswill go up significantly soon, andmany predict they’ll fall further thissummer. There are some contrarianspredicting a faster turnaround thanmost, though; they include New Yorkinvestment house J.P. Morgan,which on April 24 published a reportentitled, “Argument for $4/MCF Gasin November.”

For that to happen, J.P. Morgansays the nation must use some of itssurplus by slowing its production ofnatural gas generally. Its report notesthat many drillers already have begun to reducing their drilling and production, including in placessuch as Louisiana and Pennsylvania.Those slowdowns in production werecredited with helping to get gasabove $2 per MCF again last week,but producers will have to keep theirfoot on the brakes if they’re to get theprices they want.

Mr. James of the Ohio Oil and GasAssociation said his company, Artex,probably won’t resume drilling untilgas gets back to $5 per MCF. It willtake higher prices to support drilling,especially among drillers hungry forcapital to invest in new rigs, he pre-dicts.

“With a lot of these drilling opera-tions, even though this is a liquidsplay (in Ohio), the money to fund theoperation is coming from dry gasplays” in other states, Mr. Jamessaid. “All of a sudden the price dropsand you lost your funding source.” ■

Prices: Drillers still after wet gascontinued from PAGE 3

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“It’s ugly.” – Jerry James, president, OhioOil and Gas Association; presi-dent, Artex Oil Co.



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Duke aims to fortify local portfolioShift to new propertymanager done to get‘fresh set of eyes’ on11 remaining sites

By STAN [email protected]

In a sign that it expects to be in the Cleveland market awhile longer,Duke Realty Corp. has shifted thecontract for property management,leasing and construction of its 11-building portfolio in the RocksideRoad office market to the Clevelandoffice of Jones Lang LaSalle fromCBRE Group Inc.

Jim Clark, a Duke senior vice pres-ident in Columbus, said the vendorchange by the Indianapolis-basedreal estate investment trust is “not adirect result of what previous peoplehave done or not done.”

“A fresh set of eyes on leasing,property management and construc-tion can be helpful,” Mr. Clark said.

Duke steadily had been with-drawing from the Cleveland marketprior to the recession as it looked toconcentrate on cities with stronger

economies and higher rents. Dukesold its industrial properties inNortheast Ohio in 2006 and its office portfolio in Cleveland’s easternsuburbs in 2007. It also sold theGreat Northern Corporate Center I,II and III buildings in North Olmstedlast fall.

Mr. Clark indicated that Duke isemphasizing improving the funda-mentals of its remaining propertiesin Northeast Ohio over selling them.

In an email follow-up to a tele-phone interview, Mr. Clark said, “Atthis point we are focused on leasingand increasing the overall occupancyrates for our Rockside Road officeassets. The majority of our Clevelandassets are not being actively marketedfor sale.”

The work Jones Lang LaSalle secured is a plum that likely is worthhundreds of thousands in fees andcommissions.

Tom Fox, a Jones Lang senior vicepresident who heads its agencybusiness here, estimates the vacancyof the Duke portfolio at 33%. Vacancyrates vary in each building or complex in the portfolio; they rangefrom less than 13% at trophy prop-erties such as Park Center Plaza to72% at the older, more vanilla RockRun Center and Rock Run Center

North office buildings.Composed of buildings in Inde-

pendence and Seven Hills on bothsides of the Rockside Road inter-change of Interstate 77, the RocksideRoad office market is part of thesouth suburban market, which hasa vacancy rate of 24%, according toyear-end 2011 statistics of NewmarkGrubb Knight Frank.

In commenting about the loss ofDuke’s business, David Browning,Cleveland managing director ofCBRE, said, “They’ve chosen to goanother direction. We respect that.We value the relationship with Duke.”

Mr. Browning noted that CBREhas leased more than 300,000square feet of office space for Duke“in a soft market” on Rockside thelast three years alone.

The portfolio has faced challengesin the recession, according to Mr.Browning. He said more than 100,000square feet was emptied in Dukebuildings as tenants shut down ornational firms closed offices.

The move does not mean lostjobs for CBRE brokers and propertymanagers; they will be reassigned,according to Mr. Browning, whosaid his company still manages andleases nearly 13 million square feetof office space in the region. ■

Mini electronics maker doubles its spaceON THE WEB Story from www.CrainsCleveland.com.

Valtronic gets incentives from state, city of SolonBy STAN [email protected]

Valtronic Inc., a maker of minia-ture electronic devices, said it plansto move by early fall to a building itbought at 29200 Fountain Parkwayin Solon that is more than twice as large as its current home in thesuburb.

Patricia Klavora, Valtronic globalcommunications manager, said the company needs more space to accommodate additional production.As a private company, Valtronic doesnot disclose sales figures, but Ms.Klavora said its sales rose 30% lastyear from 2010.

The Fountain Parkway building is

Dorfman said.The city of Solon estimated

Valtronic would add 85 jobs in theperiod, she said.

Valtronic on April 20 paid $2.6million to Chagrin Valley PartnersLLC for the Fountain Parkway building,according to Cuyahoga County landrecords.

Ms. Dorfman said she is glad thecompany found an empty buildingthat allows it to expand in Solon because it has been part of the citysince the late 1980s.

“They have looked for a new loca-tion for sometime,” she said.

Valtronic plans to sell its currentbuilding, Ms. Klavora said, but hasnot yet started marketing it.

The strong industrial real estatemarket may be on Valtronic’s side.Ms. Dorfman estimates Solon’s industrial district has less than 7%vacancy and, among single-user industrial buildings such as Valtronic’scurrent one, the vacancy rate is 3%.

The company is a provider of engineering, design/development andmanufacturing services, from micro-electronics and mechanical parts tosystems serving the medical deviceand industrial markets. Its parentcompany is based in Switzerland. ■

COMING UPCrain’s Cleveland Business on May

23 will honor some of the area’s besthealth care practitioners at its annualHealth Care Hero Awards. The eventwill be held at Executive Caterers atLanderhaven.

The event is presented by AnthemBlue Cross Blue Shield and spon-sored by Huntington Bank, Kent StateUniversity and Benefits Resource Group.

For more information, visithttp://tinyurl.com/7u69urp.

Crain’s on May 16 will continue its2012 Ideas at Dawn business break-fast series with a panel discussioncentered on the hiring of interns.

The event is sponsored by the Northeast Ohio Council on Higher Education and Baldwin-Wallace College and underwritten by KaiserPermanente.

For more information and to register, visit www.CrainsCleveland.com/breakfast.

close to Valtronic’s current locationat 6168 Cochran Road. The proximityof the new site will enable Valtronicto retain its 89-person staff. Mr. Klavora said the company chose theSolon building from among six in theregion, in part because of the city ofSolon’s help.

The new building is 60,000 squarefeet compared to Valtronic’s currentbuilding of just over 25,000 squarefeet, she said.

Ms. Klavora would not say howmany jobs the company will createas its production grows. However,Valtronic’s application for a state incentive is based on the addition of50 full-time jobs over the next fiveyears, according to a state news release issued Monday after theOhio Tax Credit Authority approveda 45% credit on additional state income taxes for five years. The stategrant is based on $2.3 million in additional annual payroll.

The city of Solon also has approveda job-creation grant that exemptsValtronic from paying 40% of its cityincome taxes on additional payrollover the next eight years, accordingto Peggy Dorfman, Solon economicdevelopment manager. The incen-tive should net Valtronic about$250,000 over the eight years, Ms.


for those who make,sell, build, support,create, service,supply, repair, give,design, deliver,produce and contributeto our economy,we say thank you.

PNC Bank is a registered mark of The PNC Financial Services Group, Inc. (“PNC”). Banking products and services offered by PNC Bank, National Association, a wholly owned subsidiary of PNC andMember FDIC.© 2012 The PNC Financial Services Group, Inc. All rights reserved.

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EDUCATIONLAUREL SCHOOL: Deborah Farquhar Jones to assistant head ofschool and director of development, external affairs and marketing;Kathryn Purcell to assistant head ofschool and director of admissions.

FINANCEFIRST FEDERAL LAKEWOOD:Kathy K. Vidakovics and TimothyEndres to mortgage loan specialists.

FINANCIAL SERVICEBEACON FINANCIAL PARTNERS:Tracy Catlin to advisory practicemanager. CEDAR BROOK FINANCIAL PART-NERS: Kenneth Buzek to partner. RICHTER & ASSOCIATES INC.:Lauren Gurcze to director, revenuecycle management. WESTERN RESERVE PARTNERS:Christopher P. Santagate to analyst.

HOSPITALITYWHISKEY ISLAND & WENDY PARK:Kim Neubecker to special eventsmanager; Tish Meeker to restaurantmanager, Sunset Grille; Tom Lawsonto marina operations manager.

LEGALMAZANEC, RASKIN & RYDER CO.LPA: Joseph F. Nicholas Jr. to managing partner. MCDONALD HOPKINS: Ketan K.Patel to member, real estate practice. WALTER & HAVERFIELD LLP: Bonnie S. Finley, Geoffrey S. Gossand J. Ryan Williams to partners.

MANUFACTURINGBRENNAN INDUSTRIES: PatrickDeCapua Jr. to director of qualityand engineering. SPECTRUM SURGICAL INSTRU-MENTS CORP.: Jim Rygiel to director of endoscopy division.

MARKETINGROOP & CO.: Kelly McGlumphy todirector of client services.

NONPROFITST. CLAIR SUPERIOR DEVELOP-MENT CORP.: W. Michael Flemingto executive director; Jamar Doyle toassistant director.TEAM NORTHEAST OHIO: JessicaChapman to marketing communica-tions manager.

REAL ESTATEMARCUS & MILLICHAP REAL ESTATE INVESTMENT SERVICES:Scott J. Wiles to director, NationalRetail Group, Cleveland.

SERVICECLEVELAND MEDICAL MART &CONVENTION CENTER: Jim Bennett to senior vice president; Brian Milner to director of operations.

BOARDSCUYAHOGA COUNTY COMMUNITYIMPROVEMENT CORP.: RichikSarkar to vice president.

AWARDSBOYS & GIRLS CLUBS OF CLEVE-LAND: Barry Mintzer (Wells FargoInsurance Services) received the Outstanding Board Volunteer Award.

Send information for Going Places [email protected].

Small banks turn to wealth managementCommunity institutions embrace new area ascustomers look for bigger returns on investment

By MICHELLE [email protected]

“You’re going to have to get in thegame one way or the other.”

That’s how Bill Valerian, chairman,president and CEO of Liberty Bank,regards community banks addingwealth management to their reper-toires of services — and there’s evi-dence he isn’t the only one who seesthe need.

With so many people chasinghigher investment yields becausethey’re earning so little off their bankaccounts, this is a time when wealthmanagers have opportunity, saidMr. Valerian, whose Beachwoodbank has narrowed to seven thenumber of wealth managementpartners it’s considering as a third-party provider.

A growing number of communitybanks statewide and nationwide areweighing the addition of wealthmanagement services, said RobertL. Palmer, president and CEO of theCommunity Bankers Association of Ohio. Of Ohio’s 223 community

banks, probably 40 to 50 of themhave some insurance and/or secu-rities capabilities, Mr. Palmer said,and the association knows of manynow evaluating their addition.

“More and more of their customersare asking for the services at thecommunity bank level, (so) com-munity banks are now starting toexpand into these areas,” Mr.Palmer said.

Most community banks tend topartner with an existing wealthmanagement provider rather thanstart their own trust departments.There are pitfalls to a smaller bankgoing it alone, including the workand liability involved, said Allen S.Lencioni Sr., president and CEO ofGeauga Savings Bank in Newbury.

Mr. Lencioni said Geauga Savingsis “very interested” in moving intoinvestment services and is consid-ering potential partners, though itlikely won’t choose a partner until itdecides whether it will add on to itsexisting location or move to a largersite. That decision should comewithin the next year.

“Every community bank is lookingto augment its income right now,”Mr. Lencioni said. “(Interest) marginsare tight, but more importantly, a lotof banks used to make a lot of moneyon all kinds of fees that the publichas not responded to well. Becauseof that, avenues that we used to havefor non-interest income are dryingup to some degree.”

Also considering the addition of wealth management is Lake National Bank in Mentor, but presi-dent Andrew L. Meinhold doesn’tanticipate offering such services foranother few years.

Wealth management isn’t a massive moneymaker, local bankerssaid.

“If you do it just for the fee revenue,you’re probably going to be disap-pointed,” Mr. Lencioni said, notingthat there are investment costs andrisks to being in the business.

What banks may accomplish,though, is eliminating the threat ofunaffiliated financial planners refer-ring their customers to other banks,Mr. Lencioni said.

“So if you can provide all thoseservices under one roof and do itwell, you don’t expose yourself tolosing your existing customers,” hesaid. ■


HIGHER EDUCATIONI N S I D E

MAY 7 - 13, 2012 CRAIN’S CLEVELAND BUSINESS 13

16 STUDENTSFROM CWRURUN HEALTHCLINIC.

NANCY YURCHAK PHOTOS

Wesley Simmons, a freshman musical theater major at Kent State University, was among a group that on April 12 protested a new proposed fee the school wouldimpose on students enrolled in over 17 credit hours. “I couldn’t graduate in four years with the way these fees are going,” Mr. Simmons said.

Collegescovetingveteran enrollmentSchools become morefriendly to militaryBy CHRISSY [email protected]

Unofficially, they refer to itas a Purple Operation.

An appropriate use ofmilitary vernacular to

describe a joint effort among several universities and colleges inNortheast Ohio — including four-year, two-year, public and privateinstitutions — to attract veterans totheir campuses.

The mission is institutionally altruistic and regionally self-inter-ested.

“Our view is we all win andNortheast Ohio wins having theseyoung men and women cominghome to continue their educationin Ohio and hopefully staying inOhio and finding jobs or openingbusinesses,” said Rick DeChant,

executive director of veteran ser-vices and programs for CuyahogaCommunity College, which has increased its veteran enrollmentfrom 540 in the fall 2007 to 1,000 inthe spring semester of 2012.

“It’s going to be extremely bene-ficial to the region and to the state,”he said.

Veterans — especially those discharged with the Post-9/11 GIBill, hands down the most generouseducational benefit package sinceWorld War I — are a highly covetedgroup among colleges and universi-ties across the country.

As such, institutions over the pastfive years have ramped up recruiting,shined up their campuses to makethem more military friendly,streamlined processes and effec-tively pulled up their bootstraps tocompete for this growing populationof nontraditional, financially subsi-dized students.

Customizing servicesTake the University of Akron, for

example: The school is a standout

See VETERANS Page 14

“Word of mouth is one ofthe most effective waysthat we find to get veteransto come to your campus.Veterans talk to veterans.”

– Joshua Riderassistant director, Center for Adult

and Veteran Services, Kent State University

PAYING THE PRICEColleges more often charging fees for certain offerings,

though scrutiny grows among students, lawmakers

By TIMOTHY [email protected]

The cost of higher education cango well beyond the sticker price atNortheast Ohio’s public collegesand universities. Given dwindling

state support and the rising costs associ-ated with certain academic programs, local institutions are relying heavily onextra fees to fund their operations.

The fees, or any additional charge beyond the base tuition price, are by nomeans a new concept in higher education,just as “service fees” or “conveniencecharges” have become ubiquitous in theticketing industry.

However, in recent years they’ve comeunder heightened scrutiny by lawmakersand students alike as the cost of highereducation continues to escalate.

Kent State University, for instance, raninto some road blocks when it looked toenact a wide-ranging student fee to support a $210 million bond offering tofund an expansive campus overhaul, buta group of lawmakers who had to sign offon the proposal objected to the fee hike.

University officials this spring insteadtweaked their plans and will issue about$170 million in new debt for a scaled-

back construction program. But thistime, the bond would be funded by anew course overload fee — a $440 per-credit-hour charge for each credit astudent is enrolled over 17 credit hours.

While Kent State isn’t the only publicuniversity in Ohio with such a fee, thisplan also was met with resistance, butthis time by students.

See FEES Page 14



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Fees: Fixed prices could disappear A few thousand people signed

an online petition in hopes admin-istrators would reconsider the fee,and another 75 took to the studentcenter in protest.

An equitable solution?Denise Zelko, director of Kent

State’s budget office, said the newoverload fee was the “most equi-table way” to distribute the costs ofthe university’s capital needs. Shepegged the campus’ deferred main-tenance costs at about $350 million.

“When you look at alternatives,students who are enrolling in morehours are using more resources,”she said. “We thought that was anequitable way of finding a solutionto helping us renovate our facili-ties.”

“Equality” is a common thread inthe fee discussion among higher education administrators, particu-larly as it relates to course fees. Oftentimes, colleges and universi-ties tack fees — ranging from as littleas $5 to a few hundred bucks —onto courses that cost more to teachor require additional supplies.

For example, a basic statisticscourse at the University of Akronfor the current academic year carried a $15 course fee on top oftuition while an introduction toprintmaking course carried a $150fee. Meanwhile, Kent State chargesan additional $280 for one of itsfashion design courses and as littleas a $5 fee for a course on the morphology of lower plants.

“The bottom line is that differentprograms have different coststructures,” said Mike Sherman,

the University of Akron’s provostand chief operating officer. “Soprograms have the opportunitiesto identify where the costs exceedavailable resources and proposefees that, to some extent, make upthe differential cost across differentacademic programs.”

Such fees are by no meansunique to four-year universities,and they are just as prevalent onthe community college level aswell, according to Karen Miller,vice president of enrollment man-agement and student affairs atCuyahoga Community College.

“We try to be fair to students,”Ms. Miller said. “It’s not the sameacross the board. In order to main-tain that low tuition, we sometimesneed to add on an applicable fee.It seems to be the right thing to do.”

A new structure College officials insist such fees

haven’t deterred students fromenrolling in certain academic programs or courses. As such,higher education leaders acrossthe country are exploring how totake the concept even further given the rising costs associatedwith some academic programs.

For example, Ohio State Univer-sity president Gordon Gee, who often is regarded as a national experton issues in higher education, toldThe Washington Post recently thathe supports the idea of “differentialtuition,” or abandoning a fixed undergraduate tuition price for allmajors and assigning differentprice tags for different programs.

Differential tuition pricing hasbeen the norm on the doctoral and

graduate levels, but the concept appears to be rearing its head inundergraduate education as well. A recent study from the CornellHigher Education Research Institutefound that 143 public colleges oruniversities across the universityhad differential tuition policies.

Cleveland State University president Ronald Berkman hassaid he publicly he supports theidea of differential tuition rates,and David Cummins of the Uni-versity of Akron said the conceptwas something “on our radar.”

“We’re not doing anything withit right now. It’s a little bit more ofa global discussion,” said Mr.Cummins, the university’s vicepresident for finance and adminis-tration and chief financial officer.“Tuition is generally the sameeven though some programs aremore expensive than others, butit’s something we probably weneed to look at more closely.”

Still, dynamic tuition pricinghasn’t been widely accepted, particularly by students. In 2003,Miami University of Ohio institut-ed a “progressive tuition” programthat would have been phased inover several years to equalize pricing among out-of-state and in-state students. The programcaused confusion and was ultimately scrapped.

Students at California’s SantaMonica College staged a massiveprotest earlier this year in thewake of the college proposing tocharge higher tuition for popularcourses such as English, math andhistory. That proposal, too, eventually was tabled. ■

Veterans: Schools try tostreamline enrollmentin attracting student veterans withofferings that include a high-tech,veterans-only lounge at InfoCisionStadium, a fast-track, two-year degree in corrosive engineeringtechnology and a groundbreakingpartnership to deliver virtual therapy.

Stephen Motika, assistant deanfor student success for Summitand University colleges at the University of Akron, said the university has developed a “veryveteran-friendly culture” and cur-rently has 1,300 veterans on itscampus. In addition, 135 facultyand staff are military vets, includingMr. Motika, who served 20 years inthe armed forces.

“Our veterans come all the wayfrom being crewmen on atomic-powered submarines, which is verytechnical, to being infantry soldiers.They come with a variety of combatexperience; a good number of ourfolks have been deployed three orfour times in combat zones, othershave never left the state,” Mr.Motika said. “Each of our veteransis a little different and because of that we try to customize our services to them as much as wecan.”

Once on campus, student veteranscan relax and connect in the Musson Military Veterans Lounge,and they soon will be able to receive specialized therapies andclinical health services in thelounge’s soundproof conferenceroom thanks to a new partnershipwith Louis Stokes Cleveland VAMedical Center, Mr. Motika said.

“Telehealth is an innovationfrom the VA to touch veterans virtually and to do many of theirmedical services virtually,” he said.“As I understand it, we will be thefirst university in the United Statesto come online.”

The program launched in April,and it is expected to begin with apilot group of 12 veterans and focus on speech therapy. It alsowill bring clinical opportunities tothe campus.

“We have a very active speechpathology department here atAkron,” he said. “So the idea is thatthe student veteran will be workingwith a speech pathologist at WadePark in Cleveland virtually, butthere will be a graduate studentfrom the University of Akron sittingwith them at their side in the conference room.”

Recruiting to the student ranksJim Drnek, dean of students and

vice provost for student affairs atCleveland State University, said innovative recruiting techniqueshave helped increase student-veteran enrollment by 74% since2009.

“We are hoping to gain another50% the next two years, that’s ourgoal,” said Dr. Drnek, who hasworked closely with the NationalGuard in Columbus. Informationon CSU’s vet program and an application for admission is included as part of an informationalpacket given to servicemen andwomen during re-entry cere-monies.

Additionally, the university’smarketing team has found throughresearch that veterans watch suchtelevision channels as ComedyCentral, ESPN2, FX, the HistoryChannel and Spike, Dr. Drnek said.CSU has purchased air time tobroadcast commercials of currentstudents — a male and female veteran — describing their positiveexperiences attending the urbanuniversity.

“Word of mouth is one of themost effective ways that we find toget veterans to come to your campus. Veterans talk to veterans,”said Joshua Rider, assistant directorfor the Center for Adult and VeteranServices at Kent State University.“We really try to attract veterans by… treating the ones we have in thebest possible manner.”

That means providing GI billcertification services that are accu-rate and on time so student veteransreceive benefits in a timely fashion.

“We offer an office here that is aone-stop shop: A veteran can comein, they can apply for admission,GI Bill benefits, apply for financialaid and receive tutoring for free,”said Mr. Rider, who noted thatKent’s student veteran populationhas doubled from about 300 inJanuary 2006 to 600 currently.

This fall, Kent also will launch aLiving Learning Communityspecifically for student veteranswho are incoming freshmen. In thepilot program, which is designedfor a group of 16 — 12 males andfour females — veterans will livetogether in residence halls for two semesters and take a coupleclasses together to generate ashared experience, Mr. Rider said.

“There are going to be some additional surround services …helping them with that transitionfrom soldier to civilian,” he said.“They are used to camaraderie inthe services. They are used to


continued on NEXT PAGE




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HIGHER EDUCATIONworking as a unit and when you goout into the college environmentthere really isn’t a lot of that at first.”

Private effortsRecruiting veterans is a budding

focus area for private institutionssuch as John Carroll Universityand Baldwin-Wallace College.Both are designated as Yellow Ribbon institutions by the U.S. Department of Veterans Affairs,which means qualifying Post-9/11veterans are able to attend thecampuses tuition-free even thoughfees far exceed the $17,500 maximumannual educational benefit.

“This Yellow Ribbon program isactually what spurred us to actuallygo after this population because itis the first time private collegescould level the playing field,” saidNancy Jirousek, director of Adult &Continuing Education/VeteranServices for B-W.

How it works is the participatingschool and the VA have an agree-ment to split the difference of tuition fees that exceed the maximumbenefit for qualifying veterans. Inthe case of B-W, that amount isclose to $10,000, and B-W pays$5,000 and the VA pays the other$5,000. For John Carroll, annual tuition for 2012-2013 will be almost$32,000, leaving nearly $15,000 tobe split between the university andthe VA.

Ms. Jirousek said 35 of B-W’s 95students who are using veteranbenefits are in the Yellow Ribbonprogram.

It’s not hard to do the mathhere. Without the Yellow Ribbonagreement, private tuition wouldbe a tough sell for veterans, saidEric Patterson, director of VeteranAffairs for John Carroll, whofounded the veteran program therein February 2011 after retiring from20 years of service in Army.

“We set out to build a programthat would honestly give some-thing back from the university perspective to those incoming students in recognition to theirservice to our country,” Mr. Patter-son said.

John Carroll does its best toaward academic credit for militarytraining and every incoming vet receives at least six credits, manytimes more. The record so far is 18credit hours, he said. The universityalso gives a free meal plan to itsstudent veterans, almost all of whomare commuters, and offers them attractively priced apartments thatare a three-minute walk to campus.

These efforts are paying off. Enrollment numbers have tripledin a little over a year, from 10 student veterans to 30 currently oncampus.

“We’ll be at 45 in the fall,” hesaid. “We’re building at the pacethat is right for our university. Onething that we never like to do is tobuild so quickly so we don’t havethe support services in place. Mygoal is to have 100 student veteranswithin the next two to three years. Ithink that’s the right number forus.” ■



www.kent.eduKent State University, Kent State and KSU are registered trademarks and may not be used without permission. Kent State University, an equal opportunity, affirmative action employer, is committed to attaining excellence through the recruitment and retention of a diverse workforce. 12-0076

GLOBALLY recognized NATIONALLY ranked LOCALLY vitalKent State University is the region’s leading public university

the world, by Times Higher Education, London

the nation by U.S. News & World Report

excellence in action

Dr. MarleneWeinstein,medical director of The Free Medical Clinicof Greater Cleveland,center, assistswith the CWRUStudent-RunFree Clinic.PHOTO PROVIDED

HIGHER EDUCATION

Hands-on clinics offer healthy dose of experience, trainingCase Western-Free Clinic setup gives students a chance to run operationBy JENNIFER [email protected]

In 2010, four medical and nursing students from CaseWestern Reserve Universitycame to Dr. Marlene Weinstein

with a proposition.They wanted to create a free

medical clinic that would be operated and staffed by CWRUstudents, and they asked Dr. Weinstein, medical director of TheFree Medical Clinic of GreaterCleveland, if she would providethe space and supervision.

After more than a year of plan-ning, recruiting and piloting, theCWRU Student-Run Free Clinicheld its first free clinic in fall 2011,providing acute care to 20 unin-sured patients within The FreeClinic’s walls. Since then, they’vestaged about 20 such clinics, han-dling nearly 400 appointments.

“It extends our services to peoplewho don’t have insurance,” saidDr. Weinstein, who leads a team oflicensed clinicians who superviseevery student clinic. “They havesuch positive, good energy. This isthe reason they went into medicine.”

The number of student-runhealth care clinics is on the rise asmore medical and nursing studentsseek valuable clinical experience,

while health care needs increaseamong the uninsured or underin-sured. CWRU’s program is one of96 such clinics nationwide to participate in the newly launchedSociety of Student-Run Free Clinics, which provides a platformto share best practices.

“There’s an overwhelming amountof need in Cleveland,” said AlyssaWagner, a CWRU student pursuingher master’s degree in nursing anda member of the clinic’s foundinggroup. “I went into nursing to helpthat population that needs it.”

A student-run medical clinic —supervised by licensed clinicians— can deliver benefits for patientand student. The Free Clinic-CWRU collaboration not only pro-vides students with clinical leader-ship, but training and mentorshipin all aspects of managing a medical practice.

The CWRU clinic is held everyother Saturday morning. The clin-ic is designed for acute care only,such as routine sick visits, woundcare, blood pressure checks andwork physicals.

Through donor and grant support,the CWRU clinic also providessome medications free to patients,and pays for a courier service todeliver them. Plus, patients say theylove the attentiveness of the students.

“If you want to get some extraattention, go see some students,”Ms. Wagner said with a laugh.

Reality checksStudent-run clinics and similar

opportunities are a chance to workhands-on with patients in a lessintimidating environment.

“When you’re in school and yougo to your clinicals, it’s reallyscary,” said Heather Foos, directorof the Preventative Care Centers atthe East and Metro campuses ofCuyahoga Community College.“You have real clients with real issues, but it takes that anxietyaway that your professors are there.”

Student participation in Tri-C’sPreventative Care Centers is amandatory part of classwork. Ms.Foos said that the model for Tri-C’scenters is unique, in that it drawsstudents from allied health profes-sions, such as physical therapyand medical assisting. The centersaccommodate about 200 appoint-ments in each school semester.

Getting hands-on clinical expe-rience is important, said AnnetteMitzel, director of the NursingCenter for Community Health atthe University of Akron. But it’s alsocritical that students understandthe infrastructure of the healthcare system they soon will join.

“It’s another level of prepara-tion. … The delivery of health careis something we’ll need to be creative with,” she said. “Studentswho have vision, who are our future … give potential for improved systems.”

The six centers in Summit Countythat Ms. Mitzel oversees are nurse-managed, not student-run, andhave been in existence since the1980s. Students assist with primarycare for uninsured adults, help inthe pharmacy and work alongsidelicensed dieticians, social workersand other health care professionals.

However, it’s Ms. Mitzel’s per-sonal ambition to see a student-run clinic start at the University ofAkron sometime in 2013.

Expanding access

Back at the CWRU Student-RunFree Clinic, student interest con-tinues to exceed available positions.In their first call for applicants lastyear, they received 150 responsesfor only 35 spots.

To allow greater participation,Ms. Wagner and her team are considering expanding their bi-monthly clinics to every Saturday,operating more mobile clinics orpossibly establishing a permanentclinic at the 2100 Lakeside home-less shelter.

“(The students) want to be partof the community,” Dr. Weinsteinsaid. “They want to take care of theirneighbors. Everyone benefits.” ■


Cleveland CycleWerks does notmake a lot of motorcycles comparedto, say, Harley-Davidson, which sold40,000 motorcycles in the fourthquarter of 2011 alone. But then, Mr.Colosimo’s company doesn’t havemany of the things Harley has, like alarge dealer network, an engineeringdepartment, a legal staff, a marketingdepartment and so on. Indeed, Cleve-land CycleWerks didn’t hire its firstfull-time employee until this year.

So, 9,000 bikes is significant.“That’s fantastic,” said Dan

Moore, a Cleveland entrepreneur whoowns several companies serving theautomotive industry and who him-self is an avid motorcyclist. “I hadno idea he was that big. … Ducati isbeing purchased for $1 billion, andthey only make 40,000 bikes a year.”

Mr. Moore said he has seen

Cleveland CycleWerks’ bikes andlikes the look enough that he’s con-sidering buying a couple to teachkids to ride. The bikes are small,simple machines that seem perfectfor new riders, Mr. Moore said.

Take my business, pleaseThe company’s growth to date

has been the result of Mr. Colosimoand partner Jarrod Streng doing thedesign and administrative workthemselves, using only $30,000 theyscrimped together with a silent in-vestor. The company has grown byusing only the money it has madefrom selling its bikes, Mr. Colosimosaid — no loans, no private equity.

So why hasn’t he made bikes inCleveland? No one wanted to workwith a motorcycle startup, he said.

Mr. Colosimo looked long andhard for a local company to make

his handlebars — a simple task formany manufacturers. He finallyfound one in HMF Engineering ofCleveland, an aftermarket partscompany, but only after many othersturned him down.

“They’d say, ‘How many are yougoing to order?’ I’d say, ‘Probably150 of them at a time.’ and thenthey’d say, ‘Ehh … we don’t want todo it,’” Mr. Colosimo said.

He said it was that way for handle-bars, brake calipers, frames — basi-cally all the components that makeup a motorcycle. No one wanted todeal with small volumes, even in thehope that Cleveland CycleWerkswould become a big customer.

The reception was better in China.“In China, it was, ‘How many do

you need, how fast do you needthem and what do you want topay?’” Mr. Colosimo said. “My first


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“That could create a significantamount of growth pressure for us,”Dr. Church said. “Whether that willexceed the diminished populationout of high school is still anybody’sguess. We’re watching and moni-toring it each semester.”

Balancing actSince Lorain County Community

College invested so little in its cam-pus over the last decade, the college recently took on a significant amountof debt in a relatively short periodof time as it looked to break groundon several construction initiatives.

In the last year alone, LorainCounty Community College issued atotal of $64.9 million in debt throughtwo bond issuances, bringing thecollege’s total debt load to about

$70 million, according to QuentinPotter, the college’s vice presidentfor administrative services andtreasurer.

Nonetheless, officials said thecollege is well positioned to handleits mounting obligations, particu-larly because administrators in recentyears have designed their budgetsaround zero enrollment growth.

“We’re in very good financial

condition,” Dr. Church said. “We’revery conservative in the use of theresources we have, so we keepeverything in balance.”

Credit rating agency Moody’s Investors Services earlier this yeargave Lorain County CommunityCollege high marks for its financialperformance and noted in a recentreport that it expects the college will“maintain its established market

LCCC: Officials say school can handle debt

Cycles: China production will continue



position with strong operating per-formance that provides adequatedebt service coverage.”

Moody’s calculated the college’sthree-year average operating marginbetween fiscal years 2009 and 2011at 10.2%. Moreover, it assigned thecollege a high-quality Aa2 rating andan underlying A1 rating on its recent$24.9 million bond issuance, the bulkof which is financing the construc-tion of the new science building.

“I’m extremely confident we’ll beable to fulfill (our obligations) goingforward and maintain sound fiscalbasis,” Dr. Church said. ■

trip to China, I visited 75 factoriesthat wanted to work with me.”

It’s little wonder Mr. Colosimo isnot going to end China production.

“People like to rag on China andsay China sucks — China has mademy company possible,” Mr. Colosimosaid. “The Chinese manufacturinghas allowed me to buy a factory inCleveland that was vacant.”

Preparing for his runNow he’s got to find a way to make

that Cleveland factory profitable.Mr. Colosimo said he’ll use it as a

parts distribution center and thendo limited production later this year.He’ll probably put together bikesusing parts made in China, he said,but then, so does Harley-Davidson.

He has hired a full-time engineerand designer and probably will hirea handful of mechanics and assem-blers to put the bikes together. Thefirst bikes made in Cleveland prob-ably will be larger than the 250ccmodels he makes now, but how

much larger is a secret.Chris Warren, economic develop-

ment director for the city of Cleve-land, said the city is looking for away to help Cleveland CycleWerksrehab its building. He called it an“exciting development, one thatwould build upon the tremendouspositive momentum now being experienced in the Detroit Shore-way neighborhood.”

Mr. Moore is rooting for Cleve-land CycleWerks to succeed, but heknows the challenges it will face.His MBA thesis at Harvard Univer-sity was about why it would be difficultor impossible to start a U.S. motor-cycle company.

“He’s better off engineering ithere and sending it to China forproduction,” Mr. Moore said.

Perhaps, Mr. Colosimo said —and if things don’t work out, he’llstill have his Chinese-made bikes tofall back on.

“I have American pride. I want tomake it in the U.S.,” he said. ■


ready to release the report publiclywithin the next month.

However, Mr. Roman did respondto a question about the CBAs, a keyelement of the action plan.

CBAs have been evolving sincethe late 1990s. They usually are theproduct of community and neigh-borhood activism and public sectorparticipation and result in agreementsthat can be monitored and enforced,and that set clear goals for minorityparticipation. They may include incentives for developers — oftenin the form of more public financialsupport — if the goals are achieved.

“Clearly, it’s a place we want toreally double down and see if thereis an opportunity for us,” Mr. Romansaid.

The plan will include as many asnine other key points, though Mr.Roman said some of those may befolded together by the time the report is made public.

‘On the right path’

The economic inclusion studyhas been in the works since March2011, when a series of economic inclusion forums began. There wereat least three meetings attended byseveral hundred business leaders,union leaders and construction industry workers and executives.The soon-to-be released study grewout of those meetings.

Rachel Talton, CEO of SynergyMarketing Strategy & Research Inc.of Fairlawn, has been involved in thediscussions and was impressed withthe response from executives.

“It’s amazing, absolutely remark-able,” Ms. Talton said of the supportexpressed by the business leadersfor an effort to work harder to expandthe participation of women and mi-norities in the construction indus-try and in other industries as well.

“People were raising their handssaying they’d like to do more,” she said.

Norman Edwards, president ofthe American Center for EconomicEquality, and former president ofthe Black Contractors Group, hasbeen a vocal advocate for African-American construction subcontrac-tors and construction workers for a decade. He consistently has complained that voluntary goals onbig construction projects have notbeen met. Mr. Edwards has beeninvolved in the discussions leadingto the study, and this is the firsttime he has sounded enthusiasticthat progress is being made.

“It’s the best program that I’ve seenput together so far,” Mr. Edwardssaid. “Everybody’s on the right path.”

Long-simmering issue

U.S. Supreme Court rulings haveconstrained government from set-ting minority hiring requirementsand, when targets can be set, they’reusually described as “goals” ratherthan hard-and-fast, enforceable requirements.

African-American, Hispanic andwomen’s advocacy groups for yearshave complained that developersof public and private constructionprojects had failed to live up toagreed-upon goals to hire minoritiesbecause of union hiring hall prac-tices and the use of so-called “frontcompanies” that appear to be

owned by minority group membersbut are financed and even operatedby non-minority contractors.

Construction projects at ClevelandClinic, University Hospitals of Cleve-land, Cleveland State Universityand the under-construction Cleve-land Medical Mart & ConventionCenter all have been targets of theBlack Contractors Group and similarorganizations.

A community benefits agreementis a voluntary, but legally enforce-able, agreement. Its most notableearly use was in 2001, when the developer of a hotel and entertain-ment complex adjacent to the Staples Center sports arena in LosAngeles agreed to wage and hiringgoals and to include affordablehousing and parks in the develop-ment in exchange for support bycommunity and activist groups fora public financial package and forapproval of its building and otherpermits. ■

“It’s the best program that I’ve seen puttogether so far. Everybody’s on the rightpath.” – Norman Edwards, president, American Center for Economic Equality and former president, Black Contractors Group


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Inclusion: Prior ‘goals’ haven’t achieved desired equality results


A warning ofunknown origin■ A new group of computer hackers claimsto have broken into a restricted database atNASA Glenn Research Center in Brook Park.

And you’re next! Or so the group says.The hacker group, which calls itself “The

Unknowns,” on May 1 announced that ithad broken into computer systems belongingto NASA Glenn, the U.S. Air Force, HarvardUniversity and other important institutions.

To prove it, they posted all sorts of docu-ments and passwords on Pastebin.com, awebsite that programmers and other peopleuse to share text.

The portion about NASA Glenn includeda link to a picture of a computer screenshotthat suggests they managed to gain somelevel of access to a restricted databaseshared by several government agencies.

NASA security officials took the site downafter noticing it had been broken into onApril 20, according to a written statementfrom NASA Glenn. No sensitive informationwas compromised and NASA “is in theprocess of mitigating any remaining vulner-abilities,” the statement said.

Maybe they could get help from The Unknowns? The group says it means noharm. It just wants to help these organiza-tions find their weak points and fix them.That’s all. The hackers even list an email address so their victims can ask for help.

That goes for current and future victims.Here’s their cryptic message to those they’veyet to hack: “We’re coming, please, getready, protect your website and stop us

from hacking it, whoever you are. Contactus before we take action and we will helpyou, and will not release anything. ... It’syour choice now.”

Spooky! — Chuck Soder

Sports training for the legal set■ The dean of one local law school saysthere are only a handful of programs likethis in the country.

Cleveland-Marshall College of Law andCase Western Reserve University School ofLaw next Monday, May 14, are launchingthe Great Lakes Sports & Entertainment LawAcademy.

The program is proving popular: Coordi-nators expected they would attract 10 to 15students in the first year; instead, theyhave nearly 60, said Craig M.Boise, Cleveland-Marshall’slaw dean. About a dozenof the students, or 20%,hail from outside Ohio.

People in law schooltend to be interested insports and entertainment lawbut don’t have a defined notion of what thatentails, Mr. Boise said.

The academy, which will cost each student $2,500 and will last three weeks, will expose them to corollary practice areas, including copyright, trademark and estateplanning.

The academy also is a way to generaterevenue for both Cleveland-Marshall andCWRU, Mr. Boise said, which is even more

important in this sluggish economic climate, during which law school applica-tions have plummeted.

Plus, it’s a good way to sell Cleveland, headded.

“We thought this was a good way to attract students from other parts of thecountry here,” Mr. Boise said. “That’s important for both law schools.”

After the academy, participating studentsmay compete for about a dozen externshipswith a variety of organizations, including theCleveland Browns and the Greater Cleve-land Film Commission. — Michelle Park

Another slick dealin Youngstown■ Count George Pofok, a senior vice presi-dent at the Cresco real estate brokerage,

among the beneficiaries of the oil andshale gas boom in Ohio.

Mr. Pofok reports he representedBoston-based STAG Partners in the$3.4 million sale of its building at 1100

Performance Plaza in Youngstown to Artificial Lift Systems, a service provider tooil and gas drillers that is a unit of Weather-ford International Ltd. He noted the companywon the building for less than the $3.8 millionasking price.

Mr. Pofok joins with others in real estatewho suspect the push from businesses serving the oil and gas market quickly may exhaust the inventory of competitive existing buildings in the eastern part ofOhio. Now that would be a change. — StanBullard

WHAT’S NEW

THE COMPANY: Preformed LineProducts Co., Mayfield VillageTHE PRODUCT: Coyote One Closure

Preformed Line, which makes productsand systems employed in the constructionand maintenance of overhead and under-ground networks, says the new Coyote Onehas “enhanced its comprehensive fiber opticclosure lineup.”

The Coyote One uses a segmented endplate to provide independent access to everycable that enters the closure. The companysays installation “is quick, re-entry is simpleusing common tools, and no other cables aredisrupted in the process.”

THE COMPANY: Diebold Inc., GreenTHE PRODUCT: 4G LTE enabled ATM

Diebold bills its new ATM as the first in theworld to use 4G technology.

Working with Verizon, Diebold said it inte-grated 4G LTE technology “to create a newchannel for communication to and from theATM.” While many ATMs communicate withthe financial institution and the transactionprocessor, Diebold’s new ATM can commu-nicate with monitoring centers and other serviceproviders.

REPORTERS’ NOTEBOOKBEHIND THE NEWS WITH CRAIN’S WRITERS

THEINSIDER

THEWEEK APRIL 30 - MAY 6

The big story: Ford Motor Co. will launch athird shift at its Cleveland Engine Plant No. 1 tohandle higher demand for light vehicles using itsfuel-efficient 3.5-liter EcoBoost and 3.7-liter V-6engines. EcoBoost technology — first used in2009 on the Ford Taurus and Lincoln MKS —combines direct injection and turbocharging.About 180,000 Cleveland-built 3.5-liter EcoBoostV-6s have been purchased since 2009.

Fueled up: Fuel cells could fuel significant jobcreation in Ohio over the next seven years, according a report released by regional technol-ogy advocacy group NorTech and the Ohio FuelCell Coalition. The two groups said the statecould create more than 1,650 jobs by 2019, if theright steps are taken to strengthen Ohio’s fuelcell industry. For instance, they suggested Ohiopass legislation that would give companies anincentive to adopt fuel cells, which create chem-ical reactions that generate electricity, fueled by hydrogen and sometimes other molecules.

Exploring space: The Manufacturing Martis in the market for a new location, but whetherit can find the affordablespace it needs to remain inbusiness is unclear. MaryKaye Denning, founder andpresident of the evergreentrade show where manufac-turers can rent exhibit space,said she’s shopping for a new location after the company’s3,500-square-foot space inThe Galleria at Erieview was rented to a newtenant. The Manufacturing Mart, launched inlate 2010, had been leasing the space for a reduced rate and couldn’t afford to pay market-rate prices for the prime real estate. It will vacateits space within the next week or two.

Goodbye Kitty: The WildCat — a 42-year-oldCedar Point staple — has been put to sleep.Cedar Point announced plans to remove theWildCat roller coaster, which was nearing theend of its useful life, prior to the Sandusky park’sopening day this Saturday, May 12. The removalwill make way for the new “Celebration Plaza,”which will serve as the backdrop for the park’snew multimillion-dollar “Luminosity” laser,light and pyrotechnic show. Cedar Point said theplaza expansion was one of “several initiativesthat will beautify the park midways and enhanceguests’ experiences.”

Branching out: Onix Networking Corp. ofLakewood received a $34.9 million contract toprovide Google software to a branch of the fed-eral government. The U.S. Department of theInterior will use Google’s online email service aswell as its online collaboration software, accordingto an online summary of the award. Onix is aninformation technology services company thatalso resells Google software products.

Child’s play: The Cleveland Indians unveiledthe latest alteration to 18-year-old ProgressiveField, a long-planned conversion of a number ofsuites along the ballpark’s first-base line into anexpanded Indians Kids Clubhouse. The Indiansfor many years have been studying how to put tobetter use some of Progressive Field’s underusedareas. The team touts adults’ ability to see gameaction while their children are taking part in activities in the “Rookie Suite,” for ages 6 andunder, and in the “Slugger’s Sandlot,” for 7 andolder.

Quick work: Quicken Loans Inc. plans to hire100 new team members in its downtown Cleve-land Web Center. The new hires, all of whom willbe mortgage bankers, will join the company’scurrent team of more than 300 at the M.K. Ferguson Building, 1500 W. Third St.


BEST OF THE BLOGSExcerpts from recent blog entries onCrainsCleveland.com.

The nation comes around toToby Cosgrove’s way ofthinking■ Cleveland Clinic CEO Toby Cosgrovesometimes takes heat for his vehementanti-smoking/anti-obesity stance, but apiece in the most recent edition of Fortuneargues that he’s essentially right on themoney in diagnosing why the cost of healthcare in the United States is rising sofast.

“The great majority of America’sstaggering $2.6 trillion healthcare tab (as of 2010) was spenttreating lifestyle diseases,” themagazine noted. “While we rightlyworry about health care costs rising 8% or 9% a year, we spendwell over 50% of our costs on diseases caused mostly by the way wechoose to behave.”

Indeed, Fortune said, “If Americans behaved just a little differently, our healthcare costs could settle down to a sustainablegrowth rate that matches the economy’sgrowth, or could even fall further. … If wewould smoke and drink a little less, walk alittle more, eat a few more vegetables andfruits, and lose some weight, the effectwould be far more dramatic than most people suspect.”

This idea is slowly taking hold in thecountry.

“I got pilloried in The New York Timesthree years ago when I talked about not hiring obese people,” Dr. Cosgrove tells Fortune. “Now it’s OK to talk about it.”

For legal reasons, the magazine noted,Dr. Cosgrove “can’t refuse to hire the obese,but if he could, it would send a message: Being obese isn’t OK.”

For every action there is anequal and opposite reaction■ A real estate domino that extends toCleveland is falling in North Carolina.

The Business Journal in Winston-Salem,N.C., reported that the owner of the GMACInsurance complex in Winston-Salem “hasdefaulted on its mortgage and walked awayfrom the 485,000-square-foot property inlieu of foreclosure.”

The paper said the change in ownership“comes amid speculation that the building’schief tenant, GMAC Insurance, could

be moving within two years into adowntown Cleveland building

being renovated by its parentcompany, AmTrust FinancialServices.”

These types of things are never easy: GMAC’s lease runsthrough September 2014. The

renovations in Cleveland aren’tscheduled to be done until later that

fall, the paper reported.

The appeal of triviafor $100, Alex■ Deep into a Washington Post profile of“Jeopardy!” host Alex Trebek is a charming,Cleveland-related tidbit.

The story gets some insight from RobertKnecht Schmidt, a patent agent and lawschool student in Cleveland who started J! Archive, an online database of every gameboard, contestant and result since Mr. Trebek’s first show in 1984.

The appeal of Jeopardy! is simple, he said:Viewers enjoy pitting themselves againstplayers who’ve passed the show’s rigorousapplication and audition process.

“Trivia is representative of the culture,”said Mr. Schmidt, 31, who appeared on twoepisodes in 2010. “The show has changed ...but it’s still hard.”

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