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FDIC seeks $518M from AmTrust’s parent firm

Ohio taxes obstruct wind tech movement Legislation aims to propel industry’s competitiveness

AmFin rebuffs liability; case may set precedent for accountability to feds

By DAN SHINGLER dshingler@crain.com

When it comes to putting up turbines to turn moving air into electricity, Ohio is sucking wind. However, wind industry proponents hope legislation pending in the Statehouse will whip Ohio into shape this year. The legislation would enable the state to play catch-up with neighboring states that are well ahead in the race to develop wind power. It also would better position Ohio to cement its place as a top wind industry supply state. If passed, the new law would lower the taxes levied on wind turbines. The change would make Ohio more competitive with surrounding states, which already have addressed the tax issue with their own laws. “While every neighboring state in the northeast quadrant has moved ahead with wind farm development, Ohio has not,” said Brad Lystra, manager of economic development for the American Wind Energy Association, the industry’s primary trade group. The problem, Mr. Lystra and other industry proponents say, is Ohio’s tax structure. A developer who puts up a wind turbine in Ohio can expect to pay about $40,000 in annual property taxes. That same turbine in Michigan, Indiana, Pennsylvania and many other states would cost less than $10,000 a year in taxes, Mr. Lystra said, speaking last Tuesday, April 20, to a group of about 50 Northeast Ohio manufacturers who hope to supply the wind industry. “Of all the states in the country right now, in my opinion, Ohio is in a tight spot,” Mr. Lystra said. The result of Ohio’s current tax policy is readily visible. Since 2008, neighboring states have been building wind turbines like Amish barns. Indiana alone has put up 1,000 megawatts of wind power production in the last two years; its turbines

By ARIELLE KASS akass@crain.com

NEED FOR SPEED Efforts under way to accelerate residential, commercial connection to faster Internet service By CHUCK SODER csoder@crain.com

O

rganizations and government agencies all across Northeast Ohio are trying to add more lanes to the information superhighway. Several local groups are working on projects to make the region’s Internet faster and get more people to use it, efforts driven in part by ever-increasing demands for bandwidth and an influx of federal stimulus money. Some projects focus on helping low-income people gain access to reasonably fast Internet service or teaching them how to use it. Others aim to give local residents and businesses that have good Internet connections even faster access. See INTERNET Page 18

The Federal Deposit Insurance Corp. claims it is owed more than $500 million from the holding company of the former AmTrust Bank for failing to be a “source of strength” to the bank, a claim the FDIC and others say could have broad implications for banks nationwide. In pleadings related to the bankruptcy case of AmTrust Financial Corp. — now known as AmFin Financial Corp. — FDIC attorneys said by agreeing to a Nov. 19, 2008, cease-and-desist order that required the bank to have a prescribed amount of capital, AmFin committed “It’s not a small to keeping AmTrust Bank matter. We’re well-capitalized. going to litigate AmFin therefore should be on the hook for at least over who gets the $518.5 million, which was money.” AmTrust Bank’s capital – Eric Goodman, deficit as of Sept. 30, 2009, attorney, Baker according to the FDIC. Hostetler After its parent company filed for Chapter 11 bankruptcy protection last Nov. 30, AmTrust Bank — which now is known as Ohio Savings Bank in this area — failed and was taken over by New York Community Bank last Dec. 4 in a deal orchestrated by the FDIC. Attorneys for AmFin disagree with the FDIC and say the government agency is owed nothing. They say the company made no promises to keep AmTrust Bank well-capitalized and that AmTrust Financial noteholders and others should receive priority over the government agency. While the Office of Thrift Supervision, regulator of AmTrust Financial and AmTrust Bank, asked the holding See BANK Page 6

ON THE WEB Tune in with Crain’s This week’s podcast takes you further into the stories of Ohio’s wind market, the need for improving high-speed Internet access, the implications of the AmFin/FDIC quagmire and a boon in the housing market. Visit www.CrainsCleveland.com/podcasts.

17

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0

NEWSPAPER

71486 01032

6

SPECIAL SECTION

HIGHER EDUCATION Colleges boost tuition amid anticipated state financing cuts, inflation increase ■ Page 11 PLUS: ETHICS ■ QUEST TO DIVERSIFY ■ & MORE

Entire contents © 2010 by Crain Communications Inc. Vol. 31, No. 17


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CRAIN’S CLEVELAND BUSINESS

COMING NEXT WEEK Crain’s will identify some of the top health care professionals and volunteers in its third annual Health Care Heroes section.

APRIL 26-MAY 2, 2010

A DIFFERENT WORLD Women who work full time had median weekly earnings of $665 in the first quarter of 2010, or 78.8% of the $844 median for men, according to new federal government data. The gap between earnings of white men and white women was significantly larger than the female-to-male gap for other ethnic groups. Here’s how the data break down:

REGULAR FEATURES Best of the Blogs..19 Classified..........18 Editorial..............8 Going Places ......7 Letters................8

WWW.CRAINSCLEVELAND.COM

List: Commercial contractors ....16 List: SBA loans, second quarter ..17 The Week ............19

Characteristic

Median weekly earnings

Men

Women

Female-tomale ratio

National average

$754

$844

$665

78.8%

859

940

767

81.6

Asian White

772

869

678

78.0

Black

610

635

584

91.9

Hispanic or Latino

554

589

504

85.6

SOURCE: BUREAU OF LABOR STATISTICS; WWW.BLS.GOV

700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: Brian D. Tucker (btucker@crain.com) Editor: Mark Dodosh (mdodosh@crain.com) Managing editor: Scott Suttell (ssuttell@crain.com) Sections editor: Amy Ann Stoessel (astoessel@crain.com) Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Shannon Mortland (smortland@crain.com) Health care and education Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Manufacturing Arielle Kass (akass@crain.com) Finance and legal Research editor: Deborah W. Hillyer (dhillyer@crain.com) Cartoonist/illustrator: Rich Williams Marketing/Events manager: Christian Hendricks (chendricks@crain.com) Marketing coordinator: Laura Franks (lfranks@crain.com)

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

3

County advisers to tout land use strategy Economic development workgroup: Cuyahoga plan would help identify best places to develop By JAY MILLER jmiller@crain.com

A workgroup charged with recommending new economic development ideas to incoming Cuyahoga County political leaders meets for the first time this Thursday, April 29, with ambitious plans and high expectations.

The expectations won’t be satisfied at the first meeting, but don’t be surprised if the workgroup’s members focus on the need for more cooperation among political jurisdictions and for countywide land use planning. “We will make the recommendation that the (incoming) county executive needs to find a way toward

much more collaboration both within the county and between the county and surrounding counties,” said Judy Rawson, a former mayor of Shaker Heights and a leader of the drive to pass a county government reform issue last November. “We’re not going to tell him or her how to do that, but will recommend that this has to be done,” said Ms. Rawson, who is one of three co-chairs of the group. The other co-chairs are Sandra Pianalto, president of the Federal Reserve Bank of Cleveland, and Lee Trotter, who

was a deputy Cuyahoga County administrator until he retired late last year. Mrs. Rawson and others in the transition leadership visited Allegheny County, Pa., which went through a similar government reorganization in 2000. She said one of the most promising initiatives she saw there was a county land use plan called Allegheny Places. A land use plan, she said, could identify the best places in the county for new commercial or industrial development and which parcels of

INSIGHT

See REFORM Page 4

Late reprieve keeps rubber mixing alive in Chardon

BASEBALL’S ANSWER MAN Mark Shapiro’s inclusion on select MLB committee proof of his rep among peers

Investors buy plant, launch new company

By JOEL HAMMOND jmhammond@crain.com

By MIKE McNULTY Rubber & Plastics News

I

DAN MENDLIK/CLEVELAND INDIANS

ndians general manager Mark Shapiro is a calm sort, proven most recently by his composure in the face of fan backlash stemming from the team’s unpopular personnel moves of the past two summers. So it’s a little puzzling to hear him say he was a little awestruck, perhaps a touch nervous, when he got a phone call this offseason summoning him to New York. Nervous? Mark Shapiro? Impossible, right? Of course, when it’s baseball commissioner Bud Selig on the other end asking you to sit on a committee with legendary managers (Tony La Russa, Jim Leyland, Joe Torre), team bosses (the Braves’ John Schuerholz) and Hall of Famer Frank Robinson (a former Indians player and manager), the nerves become a little more understandable. Mr. Shapiro’s inclusion on Mr. Selig’s 14-man Special Committee for On-Field Matters — as the only member under age 50 — is the latest testament to his standing in the sport and the high regard with which he is held among peers. The group has conducted three conference calls — including one last Monday, April 19 — since its initial meeting, to study ways to improve Major See SHAPIRO Page 9

NAMING NAMES The 14 men on baseball commissioner Bud Selig’s on-field improvements committee: Mark Shapiro, general manager, Indians Andy MacPhail, president of baseball operations, Orioles John Schuerholz, president, Braves Bill DeWitt, managing partner and chairman,

so-called brownfield land should receive public money for environmental cleanup and for marketing for redevelopment. A land use plan even could restrict retail development in the county if the new development unfairly would harm existing retail operations nearby. Because such a plan might restrict development in one municipality while favoring another, Mrs. Rawson said the workgroup will consider whether to recommend that incoming county elected officials consider

Cardinals David Montgomery, general partner, president and CEO, Phillies Chuck Armstrong, president and chief operating officer, Mariners Paul Beeston, president and CEO, Blue Jays Terry Ryan, former general manager, Twins

Tony La Russa, manager, Cardinals Jim Leyland, manager, Tigers Joe Torre, manager, Dodgers Mike Scoscia, manager, Angels Frank Robinson, Hall of Fame player and manager George Will, author of “Men at Work: The Craft of Baseball”/Washington Post columnist

THE WEEK IN QUOTES “If the FDIC has the claim they assert they do ... we should hand them the keys and go away. We believe ... no such commitment was made.”

“While every neighboring state in the northeast quadrant has moved ahead with wind farm development, Ohio has not.”

“Just the cost of fringe benefits continues to be the Pac Man of the university … it continues to eat up a bigger and bigger share (of the budget).”

— Christopher Meyer, a Squire, Sanders & Dempsey attorney who is representing AmFin Financial Corp. Page One

— Brad Lystra, manager of economic development for the American Wind Energy Association. Page One

— Scott Borgemenke, interim vice president for finance and administration at the University of Akron. Page 11

“Stories in the news of ethical failures … are always a good source of generating interest.” — Paul Lauritzen, director of John Carroll University’s Program in Applied Ethics. Page 12

The expected demise of the former Chardon Rubber Co.’s custom mixing business and plant was a bit premature. A group of private investors has stepped in to buy the plant along with its compounding operation and to launch a new custom mixing business, called Chardon Custom Polymers LLC, at the 200,000square-foot plant in Chardon. The unidentified investors own several other companies; their largest holding had been a major custom mixing customer of Chardon Rubber, according to Marian Keener DeVoe, the former president of Chardon Rubber, who will serve in the same capacity at Chardon Custom Polymers. “This is a sale of the business and plant with totally new ownership,” she said. “They asked me to join their company … and it’s very exciting to have an opportunity to see something grow from the ground up.” The compounder plans to have an initial work force of about 20 former employees, with additions made as the business grows. The company will use about 20% of the plant for the time being and the investors may use the rest of the facility for other purposes, according to Ms. DeVoe. Chardon Custom Polymers probably will be producing compound material by the first part of May. The new owners are applying for a block grant, Ms. DeVoe said, which will be used to demolish the oldest part of the facility, relocate the shipping docks and realign the interior of the site. She said the company has a state-of-the-art laboratory and two internal mixers capable of producing more than 20 million pounds of rubber compound annually. “We are delighted at our investors’ commitment to our long-term stability and success,” Ms. DeVoe said. “There is a great upside for (Chardon Custom Polymers) at this location, and (the investors) are providing the resources See CHARDON Page 7


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APRIL 26-MAY 2, 2010

Reform: Lakefront a popular topic among volunteers continued from PAGE 3

Slow off the mark

some sort of revenue-sharing plan that would spread tax money from new development in one community around to other communities where development is restricted. One thing the group won’t do is identify what money can be saved by the reorganization of county government — backers of the county reform plan that voters approved last November pegged the amount at as much as $50 million — and exactly how to reallocate whatever savings are gained. “We don’t have the political authority to make fundamental decisions,� Ms. Rawson said. “I don’t think it would be constructive to develop specific programs.�

With the passage last November of Issue 6, Cuyahoga County voters approved a new county charter that creates an 11-member county council and a county chief executive, who will be chosen in the November 2010 election. The county executive will take control of departments now run by seven county officers and three county commissioners. The new charter makes only brief reference to how the transition would be accomplished. But Issue 6 promoters and the current county commissioners have created a transition organization of volunteers and broken them up into workgroups tackling specific county government functions, such as

human services, the justice system, finance and information technology. All but the economic development workgroup have begun meeting and will continue to meet over the spring and summer to make recommendations to the incoming county officials on how to restructure county operations. A report compiling those recommendations is due at the end of August, just before the county primary election Sept. 7. The economic development workgroup is the last to get organized. It got off to a slow start in part because a call for volunteers produced about 330 interested citizens. From that pool, transition leaders have chosen 30 for the workgroup and sent all the volunteers a survey to find out what in their minds were the most important economic development issues facing the county. The survey asked respondents what strategies they believe would be best to create jobs, what kinds of development would work best in different areas of the county and which large projects that might get under way in the next few years — including Public Square redevelopment, relocation of the ClevelandCuyahoga County Port Authority and a rail line between Cleveland and Cincinnati — should have the highest priority. Those results are still being tabulated, but Mrs. Rawson said her scan of some of the responses indicated “one of the huge takeaways is that everyone loves the lakefront and wants to use it better.�

In search of a focus

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Economic development workgroup members contacted by Crain’s were eager to get started, though many were skeptical about the savings that could be found from government reorganization and whether it made sense to put the bulk of that money toward economic development. Some also were frustrated by what they see as a top-down process run by a small group that started developing priorities without input from the larger group. Don Scipione, for example, has his own ideas that he has been eager to share. The president of Acme Express Inc., a web design firm, thinks improving education in the first years of school — kindergarten through third grade — is the most important long-term economic development issue the county should be tackling. “We need to focus countywide on this education issue with the teacher situation and the closing of schools,� said Mr. Scipione, a member of the economic development workgroup. “The time is right for pulling together to focus on education countywide.� Mrs. Rawson said she expects more than 100 people to attend the workgroup’s first meeting this Thursday, which starts at 6 p.m. at the Maxine Goodman Levin College of Urban Affairs at Cleveland State University, 1717 Euclid Ave. ■

Volume 31, Number 17 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright Š 2010 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $1.50. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. (888)909-9111. REPRINT INFORMATION: 800-290-5460 Ext. 136


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Bank: Case’s resolution ‘critical’ to integrity of financial system continued from PAGE 1

company to sign a Savings Association Support Agreement for the bank, AmTrust Financial did not do so, according to AmFin’s filings in U.S. Bankruptcy Court in Cleveland. The capital plan that spelled out how AmTrust Financial would keep the bank above its required capital limits “expressly stated that it was based on the assumption that no further capital contributions would be received from AFC (AmTrust Financial Corp.) or outside sources,” according to a March 15 filing by AmFin attorneys in the bankruptcy case. In the capital plan, which was to cover a period from Jan. 1, 2009, to June 2010, AmTrust Financial said it expected the bank’s capital levels to decline at first. It intended to drastically shrink AmTrust Bank’s balance sheet and its exposure to high-risk loans, strengthening the bank. A Feb. 20, 2009, letter from the Office of Thrift Supervision, included with AmFin’s bankruptcy pleadings, said the agency did not object to the plan AmTrust Financial filed in January of that year.

Follow the money Christopher Meyer, a Squire, Sanders & Dempsey attorney who is representing AmFin, said that because the holding company likely has fewer assets than the FDIC is demanding, a decision about whether the claim is valid is key to how the rest of the bankruptcy case proceeds. “If the FDIC has the claim they assert they do, essentially, we should hand them the keys and go away,” Mr. Meyer said. “We believe several things indicate no such commitment was made.” Mr. Meyer said the value of the holding company “doesn’t exceed $500 million” and that a good deal of the money is tied up in real estate — much of it in Florida — making it hard to estimate its worth. The company also is expecting a tax refund of more than $100 million to which the FDIC might make a claim, he said. Mr. Meyer said there are roughly

“Regulators have an awful lot of power here.” – Kevin Jacques, Boynton D. Murch chair in finance, BaldwinWallace College $170 million in claims against AmFin from other creditors. Eric Goodman, an attorney with Baker Hostetler who is representing the FDIC, said because the agency’s claim is based on Sept. 30, 2009, numbers, the amount the FDIC is owed might increase due to more losses that may have occurred before AmTrust Bank’s Dec. 4 failure. Because of the capital maintenance commitment to the Office of Thrift Supervision that the FDIC maintains was made when the holding company agreed to the cease-and-desist order, Mr. Goodman said, the holding company is “required to immediately cure the deficit” before it can move forward with the rest of the bankruptcy. “It’s not a small matter,” Mr. Goodman said. “We’re going to litigate over who gets the money.” A factor that makes the case “somewhat unique,” Mr. Goodman said, is the FDIC’s reliance on the cease-and-desist order to establish that AmTrust Financial had an obligation to provide capital support to AmTrust Bank. In other cases, specific signed commitments have existed. In an April 1, 2010, bankruptcy court filing, the FDIC said the case is bigger than just AmTrust Bank and its holding company and could impact how other holding companies deal with their own commitments to the agency. As such, the FDIC asked that only litigation related to the capital maintenance commitment be moved from bankruptcy court, where it is in front of Judge Pat E. Morgenstern-Clarren, to U.S. District Court in Cleveland. “The resolution of this case is of critical importance to the FDIC and the taxpayers of the United States because the Proceedings directly involve the FDIC’s authority and obligation to hold bank holding companies accountable for the commit-

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ments they make to regulators to maintain the capital of the banks they own and control,” the filing stated. “Given the stakes — to both the FDIC, the debtors, and their creditors — and the profound significance of these issues to the FDIC, an appeal is highly likely, and the District Court will be required to consider these matters in any event,” the filing states. Squire Sanders’ Mr. Meyer said AmFin would like the issue to be decided in bankruptcy court because it is a key matter in the bankruptcy case.

Setting precedents Two banking attorneys — one from Ohio and the other from Washington, D.C. — who are not connected to the case but who both asked to remain anonymous said where the matter is decided is an important issue because there is a chance the district court will be more willing to consider the FDIC’s argument than would the bankruptcy court. While the Ohio attorney said he thought the FDIC “made some very ingenious arguments,” he said the claim was “slender” and not wellfounded. Although the FDIC has won similar cases when a financial institution explicitly did agree to back a bank in such a manner, this attorney said, this case seems as if FDIC attorneys are trying to “stitch together” an agreement that doesn’t exist. “If the FDIC does get its way, it’s going to alter the landscape of regulation and financing,” the Ohio attorney said. “It’s the most aggressive I’ve ever seen them be.” The D.C. attorney said while there definitely is a dispute between the parties, he expects them to reach a settlement. He said while there is not a lot of history regarding what constitutes a capital maintenance commitment by a holding company to its bank, the issue is beginning to crop up more frequently as a result of the rising number of bank failures. As of April 22, there had been 50 bank failures in 2010 and 215 since 2008. Kevin Jacques, the Boynton D. Murch chair in finance at BaldwinWallace College and a former economist for the U.S. Treasury Department and the Office of the Comptroller of the Currency, said he expects the resulting arguments to make for “an interesting court battle.” “If I’m a betting man, I’m betting the holding company’s losing this one,” Dr. Jacques said. “Regulators have an awful lot of power here.” Dr. Jacques said if the holding company wins its argument, it could endanger the safety and soundness of the financial system because there would be no guarantee that a holding company would do what was in its bank’s best interest. That outcome could lead regulators to be stricter in restricting banks’ activities and shutting them down sooner than is currently the case — a scenario that could have “serious ramifications” on the country, Dr. Jacques said. “Any financial holding company could walk away from any bank when it’s convenient,” he said. “The FDIC is clearly going to fight this, if that’s what the holding company is aiming for. They’ll fight it tooth and nail, as far as it needs to go.” ■


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GOING PLACES JOB CHANGES ENGINEERING OSBORN ENGINEERING: Daniel Sernicola to marketing associate. PARSONS BRINCKERHOFF: Jeffrey Lechak to senior supervising engineer and manager, Cleveland office.

FINANCIAL SERVICE 212 CAPITAL GROUP: Ryan Pannell and Jason Lukz to financial advisers. ANCORA ADVISORS LLC: Robert Murray to institutional marketing. PRIMUS CAPITAL FUNDS: William R. McMaster to director. RETIREMENT SOLUTIONS: Jessica Sefcik to executive assistant. SCOTT SNOW (FINANCIAL ADVISORS) LLC: David Abate to manager. SEQUOIA FINANCIAL GROUP: Stanley Milovancev to executive vice president and director, Retirement Plan Services. SS&G HEALTHCARE SERVICES LLC: Tara Painting and Joanne Upton to billing specialists.

HEALTH CARE CLEVELAND CLINIC: Armando L. Chardiet to chairman, Institutional Relations and Development. ROBINSON MEMORIAL HOSPITAL: Robert Zemla to director, plant engineering. UNIVERSITY HOSPITALS AHUJA MEDICAL CENTER: Dr. Alan M. Hirsh to chief medical officer.

CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

Investment firm on defensive

training and workforce development. THOMSON REUTERS, ONESOURCE PROPERTY TAX: Susan FrenchScaggs to senior manager; WanKyu Park to senior consultant.

Cleveland’s JWI Capital says acquisition of W. Va. military manufacturer may lead to other defense-related businesses

Abate

Zemla

Hirsh

DiPuccio

Sweet

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Poklar

Supan

Goodman

BOARDS FUND FOR OUR ECONOMIC FUTURE: Deborah D. Hoover (Burton D. Morgan Foundation) to vice chair. NEIGHBORHOOD HOUSING SERVICES OF GREATER CLEVELAND: Jeff Marshall (Transtar Industries) to president; Marie Kittredge to first vice president; John Anoliefo to second vice president; Mark Fosnaught to treasurer; Amy Fulford to secretary. PROFESSIONAL REMODELERS OF OHIO: Gary Laurie (ABC Supply) to president; Paul E. Klein to chairman; Paul Trecarichi to president-elect; Patrict Hurst and Joe Tripi Jr. to vice presidents; Sarah Binder to treasurer; Chris Chatterelli to secretary.

Guru Award.

AWARDS AMERICAN ASSOCIATION OF NEUROSCIENCE NURSES: Erin M. Supan (University Hospitals Case Medical Center) received the 2010 Excellence in Neuroscience Nursing Education Award.

PROFESSIONAL REMODELERS OF OHIO: Sarah Binder (Stoneworks LTD) received the MVP Award; Dan Goodnow (Minute Men) received the Rookie of the Year Award; Richard P. Kasunic Jr. (CPR) received the President’s Award.

CLEVELAND ASSOCIATION OF BROADCASTERS: Vivian Goodman (WKSU-FM) received a Broadcast Legacy Award.

WESTERN RESERVE AREA AGENCY ON AGING: Marge Donley (Renaissance Retirement Community) received the 2010 Senior Volunteer Service Award.

PHOTOSHOP WORLD 2010: Brooke Figer (Kalman and Pabst Photography) received a Best in Show

Send information for Going Places to dhillyer@crain.com.

Cleveland investJantzen said. ON THE WEB Story from ment firm JWI Capital WH Smith www.CrainsCleveland.com. LLC said it has comwas founded in pleted the acquisition of The WH 1874. Vint Rathbone, the previous Smith Hardware Co. of Parkersowner and CEO of WH Smith, said burg, W. Va. it was important to sell the business JWI did not say what it paid for to a management group “with the WH Smith, which assembles and skill, excitement and capital makes fluid handling equipment and necessary to move this business load-securing and material handling forward.” hardware, mainly for military uses. “I am confident JWI can guide WH Mark Jantzen, JWI managing Smith into a new era of growth,” director, said JWI “will focus on Mr. Rathbone said. expanding (WH Smith’s) product JWI said its principals will assume offerings to government agencies active roles in the daily management and by offering our products to the of WH Smith. commercial markets.” JWI said Mr. Rathbone will serve “We also intend for WH Smith to as a consultant to the new be a platform to acquire other management team for a transitional defense-related businesses,” Mr. period.

Chardon: Dearth of capital hurts continued from PAGE 3

and support to help us realize that potential.” Chardon Rubber, formed by Jefferson W. Keener, Ms. DeVoe’s father, and other investors in 1978, filed for Chapter 11 bankruptcy protection in May 2009 after the poor economy, high raw material costs and the loss of key customers hurt the company’s sales and limited its available working capital. The company sold its rubber

compression and injection molding business and machinery, along with its Chardon Rubber name, to Wabtec Corp. in July 2009. On Dec. 31, its plastics products business was acquired by an unidentified buyer, leaving only the rubber mixing segment and plant. ■ Mike McNulty is a senior reporter with Rubber & Plastics News, a sister publication of Crain’s Cleveland Business.

LEGAL TAFT STETTINIUS & HOLLISTER LLP: Dominic DiPuccio to partner. TUCKER ELLIS & WEST LLP: Brenda Sweet to associate. VORYS, SATER, SEYMOUR AND PEASE LLP: Christopher J. Meyer to partner.

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

APRIL 26-MAY 2, 2010

PUBLISHER/EDITORIAL DIRECTOR:

Brian D. Tucker (btucker@crain.com) EDITOR:

Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:

Scott Suttell (ssuttell@crain.com)

OPINION

U b the judge

F

ew people have a clue about the qualifications of the judicial candidates they are asked to choose from when they step into the voting booth. But thanks to the earnest work of a handful of local law organizations, Cuyahoga County residents don’t need to cast their ballots for judgeships blindly. A new web site, www.Judge4Yourself.com, provides voters with the ratings of 23 judicial candidates as determined by four bar associations — The Norman S. Minor Bar Association, the Ohio Women’s Bar Association, the Cuyahoga Criminal Defense Lawyers Association and the Cleveland Metropolitan Bar Association. The site is easy to use and easy to understand. Just click on “Judicial Candidate Ratings” on the home page and it calls up a grid that breaks down the candidates by the courts for which they’re running. It then provides a single score of zero (the lowest) to four (the highest) that represents the average score for that particular candidate from the four bar groups. But it goes one step further. Under the names of each of the bar groups, it indicates whether that group believes a candidate is excellent, good, adequate or not recommended. Deborah Coleman, chairwoman for Judge4 Yourself.com, is correct when she says the only way to assure that better qualified judges are elected “is ask the candidates a lot of tough questions and share that information with voters so they can stop playing ‘The Judicial Guessing Game.’” “You don’t buy eggs without looking inside the carton,” Ms. Coleman said. “We shouldn’t pick judges without asking them a whole lot of questions.” Of course, not everyone is a fan of the web site. Michael Dolan, who is running for a seat on the county Domestic Relations Court, told The Plain Dealer he found the vetting process “to be a bit arbitrary.” That could be because Mr. Dolan received a “zero” and “not recommended” rating from all four groups. We’d give credence to Mr. Dolan’s lament if a big disparity existed in the groups’ ratings. However, the bar groups largely were in sync with their candidate assessments, which is revealing given the different points of view from which they come. Voters should take advantage of this insightful service and tap into the wisdom of these groups so they, too, can make wise choices on these important judicial posts.

Yes on 15

V

oters in Cuyahoga County understandably have little faith in county government because of a continuing federal public corruption investigation. However, we hope voters don’t express their disapproval by voting against the county health and human services levy that is on the May 4 ballot. The levy helps provide vital human services to some of the most vunerable members of our community, and it does not raise taxes. We urge county residents to vote “yes” on Issue 15.

FROM THE PUBLISHER

Cleveland sports fans having a ball

S

business deals in which they have no place. o as I sat at my desk last Thursday, I Now back to Draft 2010, which was the really wanted to write about the constant topic of discussion around town (then) coming NFL draft, but I knew the past week or so. This despite the Cavait would be all over and the Browns liers being in the first round of the NBA would have their choices made by the time playoffs! you read this. Now in a normal time in Cleveland Writing about Mayor Frank Jackson history, this might have been an annoygoing to Dennis Kucinich for advice, guidance to Cavaliers brass. What ance or whatever else regarding a should be more important to our merger between Continental and BRIAN sports fans — a bona fide chamUnited airlines also was out, for TUCKER pionship-caliber team or one so many reasons I hate to start that has struggled its entire enumerating them. I know the “new” existence? mayor is in a hard place because And that is exactly the point. he has nothing to act on and The Cavs were up, two games to yet feels he can’t wait, lest he be none, against the Bulls as of last criticized for that. Thursday morning, and looked The thing is, Continental, for to be in the driver’s seat. As I’ve all the good it has spurred with written in the past, this is the first the hub here, is a massive comyear I can remember in my 58 years of bepany with a lot on the line. It will do what ing a Cleveland sports fan that expectations is in the best interest of its shareholders of a world championship are so high. and employees, as it should. Absent an The Cavaliers have the best ownerantitrust issue or some other potential ship/management/coaching team they’ve negative, politicians should stay out of

ever had, and no one expects them to lose to the Bulls. From Dan Gilbert to Danny Ferry to Len Komoroski to Mike Brown, the Cavs hierarchy is rock solid. And there is that little detail about having the most gifted player on the planet on their team. So naturally, sports fans looked to the NFL draft with heady anticipation, in part because they always do — hope springs eternal for a Browns fan, regardless of the facts. As veteran sports writer Terry Pluto said in a radio interview last week, “(The draft) is their Super Bowl because they’ve never had a Super Bowl.” They’re also excited, rightly, about the management team that owner Randy Lerner has put in place. The fans believe in Mike Holmgren and the experienced staff he has assembled. And they know that despite all the odds against NFL draftees succeeding, that at least a handful of those 10 are going to help improve the team. We don’t know enough about the young Indians yet, but this is a pretty cool time to be a Cleveland sports fan. ■

LETTERS

No joke: We’re better off without the smoke ■ Here’s a message for Mark Dodosh: Please do not advocate repealing Ohio’s no-smoking laws, as he seems to do in his April 19 commentary, “The Marlboro Man would be proud.” We non-smokers worked so hard to get the laws enacted, and it is so awesome to be able to walk into any bar and restaurant in the state of Ohio and know that the air will be free of smoke. Keep in mind that it’s also those employees who work at restaurants and bars who benefit from no-smoking laws. They usually do not have a choice as to where they are employed. They, and the items they serve, were previously exposed, like it or not, to tobacco smoke every minute of every day. In a free market system, restaurants and bars have to be unified against prohibiting patrons from smoking. Otherwise, the playing field is not level. I hope Mr. Dodosh meant his commentary to be read with tongue

firmly planted in cheek. There are better ways to raise money to fund the arts. Judy Oliver Twinsburg

Up with Issue 1 ■ The May 4 primary election in Ohio provides voters with the opportunity to support a program that, quite simply, gets it right for Ohio. Issue 1 — which does not raise taxes — is a statewide measure to renew the highly successful Ohio Third Frontier economic development and jobs program. Through Third Frontier, Ohio has made key investments in technology, research, innovation and entrepreneurship. With a total return on investment averaging 22% per year over the life of the program, Third Frontier has resulted in more than 571 new companies, the expansion of businesses and more than 48,000 new jobs for Ohioans. In addition, Ohio businesses and

college students have benefited from a Third Frontier-funded internship program which has awarded more than $1.5 million to employers who hire highly trained college students as interns for their tech-based industries. The Northeast Ohio Council on Higher Education (www.noche.org) has witnessed the extraordinary help that Third Frontier has offered to these businesses and college students — the state’s best and brightest future workers — and urges support for this program that is the envy of other states. For more information, visit www.unitedforjobsohio.com. Vote “yes” on Issue 1 on May 4, and say “yes” to a bright future for Ohio. Robert P. Reffner Chairman Ann Womer Benjamin Executive director Northeast Ohio Council on Higher Education


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Wind: Ohio manufacturers Shapiro: GM well regarded eager for some business continued from PAGE 3

continued from PAGE 1

now generate electricity for homes and businesses and yield thousands of dollars for farmers and other landowners who lease space for the giant structures. The state also benefits from hundreds of jobs for wind turbine installers and crews to maintain the structures. Ohio? It has about 8 megawatts of wind energy production, most of it coming from small installations, some of which only supply power to their owners or are mainly for show. Unless the state changes how it treats wind development, those in the industry say, Ohio is likely to continue to lag other states in energy production — and that outcome ultimately would hurt Ohio manufacturers who hope to supply the industry with parts.

A senator steps up Enter state Sen. Chris Widener of Springfield. The Republican wants to exempt turbines in Ohio from property taxes and instead tax them at a rate of $7,000 per megawatt. That rate would result in a cost of about $10,000 for some of the larger turbines now being installed, but less for others. It would put the Ohios tax burden in line with its neighbors, said Sen. Widener and Mr. Lystra, who supports the effort. The bill now is before the Ohio Senate’s Energy and Public Utility, where it has withstood six hearings and testimony from those for and against the measure, said Sen. Widener’s legislative aide, Brad Ingraham. The effort enjoys bipartisan support, though proposals in the Ohio House and from the governor’s office differ slightly. Both the House and Senate bills would apply to wind and solar energy projects, but Sen. Widener’s measure also covers investments in clean coal and nuclear power generation, the senator said. The House bill also gives developers varying degrees of tax breaks, depending on how many Ohioans are employed by a project. “That’s too cumbersome,” said Sen. Widener, who noted his bill requires the companies to employ mostly Ohioans, but does not leave them guessing about future tax bills.

Encouraging the development of a wind power industry in Ohio is important, and not only for the landowners who would lease space to the towers and the construction crews that would put them up. Ohio manufacturers are hungry for wind energy business, said John Colm, president of the manufacturing advocacy group Wire-Net in Cleveland. Wire-Net’s Great Lakes Wind Network has attracted 1,450 members, including 700 Ohio companies, Mr. Colm said. Of those, 179 already are selling to the wind industry, and many others are trying to get in. In terms of new installations and industry spending, wind energy is expected to have a growth rate of more than 25% annually through at least 2014, Mr. Colm said, and is ready to take off in the state. Mr. Colm said 500 megawatts of wind projects already are planned for Ohio, and more will come quickly if the conditions are right.

Need for speed Companies that have penetrated the wind market need no convincing as to the importance of improving the environment for wind in Ohio. Cardinal Industries in Bedford Heights never had sold into the wind industry until 2007, said chief operating officer Wendy Brugmann. When Cardinal got its first order for bolts from a turbine developer, it didn’t even know what they were for, only that a customer needed them quickly and Cardinal could fill the order fast. Today, Cardinal gets about half its revenue from the wind industry, Ms. Brugmann said. A photo of a Cardinal employee even made the cover of wind energy association’s 2009 annual report, under the banner “rebuilding America one bolt at a time.” Now, folks such as Mr. Lystra, Mr. Colm and Sen. Widener hope the state can move quickly to better position more Ohio companies to copy Cardinal’s success. While bolts can be easily shipped across the country, larger components benefit greatly by being made near their final installation — which could be Ohio if Sen. Widener’s bill or one like it is passed. ■

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League Baseball’s on-field product. While Mr. Shapiro and others are mostly vague early in the process, be sure hot-button topics such as instant replay, umpiring, lengthy games and realignment are chief among the issues that have been or will be discussed. “Mark Shapiro is one of the truly impressive young executives in Major League Baseball today,” Mr. Selig said in an e-mailed statement. “His intelligence is accompanied by great passion, creativity and a collaborative spirit, and those were exactly the qualities I sought.” Mr. Shapiro favors instant replay, and said the committee would focus on improvements it could make touching issues subject to collective bargaining, such as the league’s revenue-sharing model. Already, the league has made a change to limit off days between playoff games; committee member and Los Angeles Angels of Anaheim manager Mike Scoscia had been critical of off days in last year’s American League Championship Series. “Our first meeting tackled a wide range of things,” Mr. Shapiro said. “Later, we’ve narrowed it down and talked about smaller things we can

do quickly, and later we’ll go back and tackle some of the bigger things.”

Praise from peers While the commissioner’s out-ofnowhere request for Mr. Shapiro’s assistance may surprise Indians fans who are, well, less than pleased with the current state of the team, the rise of the Tribe’s soon-to-be president is no surprise to his peers. Andy MacPhail, a longtime Chicago Cubs executive before becoming the Baltimore Orioles’ president of baseball operations in 2007, sits on Mr. Selig’s committee and said Mr. Shapiro quickly overcame any initial unease. The Indians’ boss has an extensive business background, Mr. MacPhail said. “He offers a little different perspective than some of the guys who have been around the game for a longer period,” Mr. MacPhail said. “He’s more well-rounded, both with business experience but also with some different analytics teams are using.” Arizona Diamondbacks general manager Josh Byrnes got his start in the Indians’ front office in 1994, two years after Mr. Shapiro; Mr. Byrnes’ last role here was as the Tribe’s scouting director, before he left for the Colorado Rockies. He said one

of Mr. Shapiro’s greatest strengths is involving those he’s leading in his decisions. “He’s very passionate about people, empowering and developing them,” said Mr. Byrnes, who said he got his interview with the Indians because of Mr. Shapiro’s father — longtime agent, Ron. “His leadership style is very selfless, very inclusive.” Mr. Shapiro admits he’s been tested at times, perhaps never more than now, when attendance at Progressive Field is at an all-time low. The challenges have changed, though: Previously, the Yankees, Red Sox and other big-market clubs poured resources into their major-league payrolls; now, those teams are operating like small-market teams, with added emphasis on scouting, talent development and analytics. The challenges notwithstanding, Mr. Shapiro said he’s stayed in Cleveland because he’s invested in the team and looks forward to bringing a winner back to Progressive Field. “We’ve been through periods when we were the toast of the town, but you have to realize these moments were never far away,” Mr. Shapiro said. “You can’t get too far up when people are calling you geniuses, and can’t let the negativity now affect you. “I hate losing,” he said. “This doesn’t dull your competitiveness at all; I take the responsibility of pleasing the fans very seriously.” ■

When It Gets Down to Business… Solon Gets It! The City of Solon welcomes these new businesses: 1 EDI Source, Inc. Anna Maria at Home LLC Benny’s Grille Charles Shoe Repair Cleveland Tungsten Inc. Comfort Systems USA, Inc. Dynamix Group, LLC Extreme Slate Roofing J.B. Hunt Keller Williams of Greater Cleveland Southeast, LLC Pacific East Premier Metal Services, LLC Teresa’s Pizza Management Christopher Paul Viland, Attorney at Law Water & Wastewater Equipment Co.

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Prime industrial, office and retail sites at www.solonohio.org City of Solon • 34200 Bainbridge Road • Solon, Ohio 44139 • 440.337.1313 Peggy Weil Dorfman, Economic Development Manager • pweil@solonohio.org

9

The Solon Select is a distinguished group of more than 800 businesses that have chosen to locate in the City of Solon.


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INSIDE

13 CLASSES DELVE INTO BREADTH OF SOCIAL MEDIA.

11

HIGHER EDUCATION

COLLEGES SET COURSES OF ACTION Inflation, expected declines in state funding pave the way for Northeast Ohio universities to increase tuition By SHANNON MORTLAND smortland@crain.com

C

ollege students will see higher tuition in the fall as schools in Northeast Ohio and across the country look for additional revenue to pay the bills. Most Northeast Ohio colleges already have raised tuition for fall or are considering price hikes as they search for

new ways to handle inflation, debt service and anticipated cuts in state funding. “Just the cost of fringe benefits continues to be the Pac Man of the university,” said Scott Borgemenke, interim vice president for finance and administration at the University of Akron. “It continues to eat up a bigger and bigger share (of the budget).” See TUITION Page 15

ADDING INSULT TO INJURY Rising costs are nothing new to higher education. In a report released in October, The College Board, a nonprofit membership association made up of more than 5,600 educational organizations, announced that college prices for the 2009-10 academic year were rising as state funding and endowment values declined. Average price changes for the 2009-10 academic year:

Private nonprofit 4-year

Public 4-year in-state

Public 4-year out of state

Public 2-year

For-profit

$7,020

$18,548

$2,544

$14,174

Published 09-10 tuition

$26,273

1-year dollar increase

1,096

429

1,088

172

859

1-year % increase

4.4%

6.5%

6.2%

7.3%

6.5%

SOURCE: THE COLLEGE BOARD


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12 CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

APRIL 26-MAY 2, 2010

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Ethics training assumes varying forms as current events raise awareness Students explore individual character, sustainability By AMY ANN STOESSEL astoessel@crain.com

“Sustainability is a wonderful broad concept that people are latching on to,” he said. “I call it the new hile teaching ethics is corporate ethics of the 21st century. not a new focus for It opens up the frame of thinking.” college campuses, some Shannon French, director of the believe that current Inamori International Center for events have at the very least helped Ethics and Excellence at Case bring questions of discerning right Western Reserve University, said she from wrong to the forefront. too has noticed a shift in regards to Northeast Ohio schools that ethics training. already had a strong commitment to “The thing I most often get asked ethics training are continuing in to present on … they want me to talk their missions, and in some cases about character,” Dr. French said. those efforts are taking on a new That center’s focus is on ethics shape. and ethical leadership, and it is a Lake Erie College, for one, recently university-wide entity serving all of increased its focus on the subject CWRU’s colleges through speakers, with the establishment last year of training and workshops. In addition its Center for Ethics. to working with students, the center “In general, it’s very important supports faculty activities and given what we’re seeing happening participates in community outreach, in the world today,” said Scott such as its upcoming International Evans, the college’s vice president Peace and War Summit, which is for institutional advancement. slated for Oct. 25 to 30. The center held Overall, Dr. its first event on French said, April 16, “Ethical “Sustainability is a wonderful there has been a Issues for Forensic broad concept that people greater emphasis Psychology on the individual are latching on to.” Practice: What and ethics at the Psychologists and – David Krueger personal level, Lawyers Should director of Institute for Sustainable rather than on a Business Practice, Baldwin-Wallace specific set of Know,” and while plans still are in rules and case the works for the studies. center, Lake Erie College said the “I definitely think it’s a response basis for programming will be to to what is happening around us,” provide multidisciplinary education she said. opportunities, lectures, professional ‘Teachable moment’ development and support for ethics research and scholarship. There always is a bump in Alison Benders, who recently interest when current events lend started as Lake Erie College’s vice themselves to discussions of ethics, president for academic affairs, said said Robert Lawry, director and she hopes the center ultimately will co-founder of the CWRU Center for help bring ethical discussions into Professional Ethics, which was perspective. “I want to be known for created more than 25 years ago and the translation of theory into in recent years became part of the practice,” she said. law school. Dr. Benders, who previously was “There’s always a hue and cry dean of graduate and professional when you have that next scandal,” studies at Ursuline College, said a he said. However, he said that genercampus should play a role in ally speaking there can be resistance discussions over ethics. — especially from some business “Educational institutions are schools — to further entrench ethics privileged by society to be the place training into curriculums. to have these hard conversations,” The emeritus professor of law Dr. Benders said. said the ’80s and ’90s were growth periods for ethics training while New approaches efforts have plateaued over the past David Krueger, the Charles E. 15 or so years. “It seems to be the Spahr Chair in Managerial and case it very much has become part Corporate Ethics at Baldwinof the mainstream,” Dr. Lawry said. Wallace, said Watergate and the Similarly, Paul Lauritzen, director scandals of the 1970s in some ways of John Carroll University’s Program served as a catalyst. in Applied Ethics, said there has not “The field of business ethics is necessarily been a significant only a generation old,” he said. change in interest at that school due “Over the past 30 years, business to current events. He attributes that ethics has really become mainto John Carroll already having a stream.” dedication to the subject; its From Dr. Krueger’s viewpoint, interdisciplinary Program in Applied business ethics today is linked to the Ethics was established in 1992. concept of sustainability. B-W has a However, Dr. Lauritzen said when number of initiatives in progress to scandals emerge there can be a broaden its programming in that renewed commitment to addressing area, including an undergraduate ethics issues, using current events as degree, the Institute for Sustainable “a teachable moment.” Business Practice, for which Dr. “Stories in the news of ethical failKrueger serves as director, and plans ures … are always a good source of for an MBA in sustainability. generating interest,” he said. ■

W


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CRAIN’S CLEVELAND BUSINESS 13

HIGHER EDUCATION

Courses dissect social media complexities Corporate College hosts classes designed to instruct attendees on methods to maximize tools’ potential By CHUCK SODER csoder@crain.com

T

he social media landscape is too vast to traverse in 30 minutes. That’s why Corporate College and LNE Group LLC have created the Social Media Lab, a series of classes designed to teach businesses, organizations and individuals the best ways to use web sites such as Facebook, LinkedIn and Twitter. The classes, hosted at Corporate College East, cover how social media tools can be used for all sorts of purposes, such as promoting a brand, recruiting and communicating with customers. It would be too difficult to cram all that information into a single seminar, said Chuck Mackey, executive director for information technology at Corporate College. He got the idea to form the Social Media Lab in September after watching Michael DeAloia, a practice leader for the LNE Group, a government and public relations firm based in Cleveland, give a presentation on the topic during a luncheon at Windows on the River in the Flats. The presentation was good, but Mr. Mackey wanted more. He asked if the others at his table felt the same way. They did. “I thought, ‘Boy, this is really great, but a half-hour discussion on this isn’t going into any detail,’” Mr. Mackey said. Seems he was right about demand for classes. The four Social Media Lab classes held since the program began in February each have attracted about 15 to 20 people, so Corporate College and the LNE Group, which helped design the curriculum for the courses and locate presenters, expect to be able to organize a class every few weeks. They’re also planning to start a new series of “express” classes that would cover the same topics in hour-long blocks scheduled first

thing in the morning or during lunch. The standard class is four hours long, but participants don’t just sit and listen the whole time. Though each class starts with a lecture, those who attend use Corporate College computers to follow presenters as they discuss ways to use various web sites. After the lecture, participants experiment with the tools themselves to figure out how they might best use them, while experts provide assistance, said Mr. DeAloia, who used to be the city of Cleveland’s senior executive for technology development and came to be known as the “tech czar.” “We’re presenting and then we’re actually doing it, right then and there,” he said. Mr. DeAloia teaches a class called The Four Pillars of Social Media, which covers the basics of how companies, organizations and individuals can use Facebook, LinkedIn, Twitter and blogs. The other classes include Branding in the Social Media Sphere, Social Media Analytics, Social Media in Exceptional Customer Service, Social Media and Employee Attraction, and Social Media Techniques for Business Development. Anyone who completes four of the classes would receive a specialist certification from the Social Media Lab, and anyone completing six would receive a professional certification. Each class costs about $400, though groups and nonprofits can get discounts. The Social Media Lab Express seminars would cost significantly less.

A right way and a wrong way John Heaney, who teaches the class about branding, said social media tools, while free, don’t work well for organizations that don’t put in the time and effort to use them properly. They can even backfire, he said, describing how environmental

Empowering women since 1871, Ursuline charges students to grow and develop their values. Ursuline is a place where expressing yourself is encouraged and finding your voice is a requirement. In the likeness of the Ursuline’s heroic founder, each student is inspired to shape a unique, personal vision.

activists now account for a majority of the people on Nestlé’s Facebook fan page after the Swedish food giant failed to respond quickly to online comments about the company buying palm oil from an Indonesian supplier accused of destroying rainforests. Social media can work for individuals, too, said Mr. Heaney, who owns Orange Envelopes, a Northeast Ohio marketing firm for small businesses. For instance, an unemployed friend of his quickly won a new job after an interview partly because the company found

his credentials and his blog online. Most people, however, won’t even add their professional contacts on Facebook to lists that would block them from seeing personal information and photos. “Why should I get pictures of your family vacation?” Mr. Heaney said. Frank Zupan, who has taken one Social Media Lab class, already used sites such as Twitter and LinkedIn for recruiting purposes at Dealer Tire LLC, a Cleveland company that helps car makers manage tire replacement programs for dealerships. The class, however,

taught him ways to use the different tools together, he said, noting that his LinkedIn profile now carries the messages he posts via Twitter. “It really did a good job of tying the components together,” he said. Mr. Zupan plans to attend another class, as does Pat Walker, president of 4walls, a Cleveland company that designs and sells decorative wallpaper and other wall products. Mr. Walker, who plans to use Facebook to target interior designers and architects, said he liked that the presenter didn’t act as if social media tools were going to solve all his problems. “It wasn’t a faucet we were going to turn on and get instant results,” he said. ■

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Jesuit educational excellence since 1886


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HIGHER EDUCATION

THEINTERVIEW MARILYN SANDERS MOBLEY Vice president for inclusion, diversity and equal opportunity Case Western Reserve University By JAY MILLER jmiller@crain.com

M

arilyn Sanders Mobley still considers herself a teacher, even though her job for the last year at Case Western Reserve University has been as vice president for inclusion, diversity and equal opportunity. “I’ve been doing diversity work all my life, but as an English professor,” she said Mobley recently. “I see diversity work as an extension of my training as an educator; it’s about sharing ideas and often strategies.” Dr. Mobley has been CWRU’s diversity chief since January 2009. CWRU president Barbara Snyder elevated the diversity office to a cabinet-level job with the hiring of Dr. Mobley in one of several efforts the university has undertaken since Ms. Snyder became president in 2007.

The university identified inclusion and diversity as core values in a strategic plan adopted in 2008. In November, the university led a group of six northern Ohio universities that won a $1 million National Science Foundation grant to expand a CWRU program designed to recruit and retain women and other underrepresented minorities in the sciences and engineering. It also is opening later this spring a Lesbian Gay Bisexual Transgender Center in the student center to make the university more welcoming to LGBT students. “There have been some good diversity initiatives here already but President Snyder knew, the board of trustees knew, we all knew that we needed to ramp up our efforts,” she said. “Putting this at a cabinetlevel position is a step in the right direction.” Dr. Mobley noted that the academic world may be lagging behind the business world, where some corporations are aggressively creating more diverse work forces. “In many respects,

corporations have already stepped up their efforts as it relates to diversity,” she said. “In higher ed, where you might think it’s already happening, it’s been happening in spurts and starts.” Dr. Mobley divides her job into two parts. One is to make sure those with diverse backgrounds, including disabled, foreign and minority students, faculty and staff, feel comfortable on campus. The other side of her job is to make sure the university complies with its legal and moral responsibilities to provide equal opportunity in hiring and in procurement. “We have to keep both in front of us, like two trains running smoothly side by side,” she said, though she acknowledged, “some conflict is inevitable.”

Full circle Dr. Mobley said that she realizes the work will sometimes seem intrusive, like when she sits in with a department search committee looking to hire a new professor and reminds the committee to make sure it casts a wide net. “Often, people want to do what they’ve been doing,” she said. “So, often, a diversity officer’s work is to say, ‘Maybe you want to look at this

or look at that; maybe there’s a better way to do (the search) that is more inclusive.’” Dr. Mobley used to be on the other side of that conversation — as a faculty member chairing a search committee — and that eased her transition into her work as a diversity officer. An Akron native, Dr. Mobley earned a bachelor’s degree in English at Barnard College of Columbia University in New York City and a master’s in English from New York University. She came back to Northeast Ohio to get her doctorate in English from CWRU. For two years during the time of her doctorate studies she was program coordinator of the Afro-American Cultural Center and assistant director of the black studies program at Cleveland State University. She began her post-doctoral teaching career at Howard University in Washington, D.C., before moving on to spend 15 years at George Mason University teaching English and founding the AfricanAmerican studies program at the Fairfax, Va., school. She rose to associate provost for educational programs before leaving George Mason in 2007 for Bennett College for Women in Greensboro, N.C., where she was provost, the chief academic officer. The CWRU job was attractive to her in part because it brought her home to her ailing mother in Akron. She was chosen — by a search committee — from more than 130 applicants. Closest to her heart academically, and even now professionally, is the work of Lorain author and Nobel Prize winner Toni Morrison, who she describes as understanding the dynamics of diversity. In fact, Dr. Mobley is a past president and a

current advisory board member of the Toni Morrison Society, a nonprofit devoted to the life and work of the author of the Pulitzer Prizewinning book, “Beloved,” which is a story that explores the impact of slavery and emancipation on the book’s characters. But Dr. Mobley vividly remembers another Morrison work, an essay titled, “The House that Race Built,” that put race in perspective for her. “I love the way she has helped me as a thinker, as a woman and as an educator” understand race.

Making an impact Her work so far has drawn plaudits from at least some of those she serves. Jane Daroff, a social worker with the CWRU counseling center and a member of the board of directors of the Human Rights Campaign, a Washington, D.C.-based nonprofit that describes itself as the largest national lesbian, gay, bisexual and transgender civil rights organization, gives Dr. Mobley a passing grade so far. “I know she’s been making a big impact on campus,” Ms. Daroff said. “I think she’s working very hard and I know some of the people working with her and they seem very pleased with the progress.” Student leader Duwain Pinder concurs with Ms. Daroff. “I’ve been really, really pleased,” said Mr. Pinder, a senior and president of the undergraduate student government. “There’s been a lot more dialogue taking place on a student-faculty level.” Mr. Pinder said he thought a program called Diversity 360, which brought students together with corporate recruiters to talk about efforts in business to hire a diverse work force, was especially helpful as he gets ready to enter the real world. ■

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HIGHER EDUCATION

Tuition: Ohio’s colleges in better position than those elsewhere continued from PAGE 11

Last month, Akron approved a 3.5% hike in tuition and fees for undergraduates and graduates and a 6% tuition boost for law students. Mr. Borgemenke said the increase will help the university handle new debt service, maintenance for a new parking garage and overall rising expenses. Ohio’s public colleges were permitted by law to raise tuition 3.5% in the 2009-2010 and 20102011 school years. As a result, Cleveland State University used a mid-year increase to bump its tuition up by 3.5% for the current semester and will implement another 3.5% tuition increase for fall, said Rob Spademan, a spokesman for Cleveland State. Kent State University has not yet discussed a tuition increase for fall but the topic could come up in the school’s May 26 board meeting, a spokeswoman said. Community colleges are enacting similar increases. Last week, Cuyahoga Community College announced its tuition will increase next year to $84.57 per credit hour, up 5% from $80.54 per credit hour. It is the first tuition hike at Tri-C in four years. “The volatility of state funding has impacted the college’s finances and higher education across Ohio,” said Craig Foltin, Tri-C executive vice president of administration and finance. “When comparing Tri-C’s state funding in 2001 to expected state funding later this year, the college will receive almost $43 million less in inflation-adjusted dollars.” Lorain County Community College also announced earlier this year that its tuition will rise 3.5%, from $90.60 to $93.75 per credit hour, beginning this summer due to state budget challenges for higher education.

Not just a public problem Local private institutions have

A REVIEW OF COLLEGES’ PLANS A number of Ohio’s public and private colleges have inflated costs for the coming school year. ■ Cleveland State University implemented a 3.5% mid-year boost and has another 3.5% hike slated for fall. ■ Cuyahoga Community College is increasing its tuition by 5%. ■ Lorain County Community College’s tuition will rise by 3.5%.

increased tuition by varying degrees as well. Lake Erie College increased fall tuition by 1.5% to $25,674, up from $25,296, said Robin McDermott, vice president for enrollment management and student affairs at Lake Erie. Notre Dame College will boost its tuition to $23,080 in the fall, which is 3.9% higher than the current annual tuition of $22,192, said David A. Armstrong, vice president for enrollment at Notre Dame. “We’ve tried to keep those (increases) below 5%,” he said. Though Notre Dame held benefits and salaries steady and laid off three people in the current fiscal year that ends June 30, rising fuel costs and the college’s enrollment growth have had a big impact on its budget, Mr. Armstrong said. For its part, John Carroll University has seen its health care and employment costs increase, so the university has approved a 4.6% tuition boost for next fall, said Brian Williams, vice president for enrollment at John Carroll. Likewise, Baldwin-Wallace College is raising its tuition to $25,260 in the fall, an increase of $1,030 or 4.25%, said Tom Lee, the college’s vice president for financial aid and administration.

■ Lake Erie College increased fall rates by 1.5%. ■ Notre Dame College will raise its fall tuition by 3.9%. ■ John Carroll University approved a 4.6% bump in the cost to pursue a degree. ■ The University of Akron OK’d a 3.5% hike in tuition and fees for undergraduates and graduates. ■ Baldwin-Wallace College is raising tuition by 4.25%. Baldwin-Wallace’s endowment has bounced back to $110 million from its low of $95.8 million last year, but still is well below its high of $130.2 million at the end of 2008, he said. The decline has resulted in the loss of $600,000 in operating funds the school receives from its endowment in the 2009 and 2010 fiscal years, he said. In addition, the state eliminated the Ohio Choice Grant, which helped students attend Ohio’s private schools, Mr. Lee said. Consequently, Baldwin-Wallace lost $2 million from that grant and had to reduce its budget to make up for that loss, he said. “It’s not an increased-spending problem that I see,” Mr. Lee said. “It’s more of a market-driven forces problem and a drop in our endowment value.”

Could be worse Tuition increases at Ohio’s private colleges are in line with those expected across the country for the upcoming school year, said Tony Pals, a spokesman for the National Association of Independent Colleges and Universities in Washington, D.C. The association is conducting its annual member survey and, so far,

tuition increases are falling between 4.5% and 5% for next fall, he said. That’s slightly higher than last year’s average tuition increase of 4.3% for private colleges across the country, he said. However, Ohio’s public colleges are faring better than their counterparts in other states, mostly due to budget deficits fueled by the recession. The state of California is grappling with a $20 billion budget gap and has announced that tuition at its public universities could skyrocket as much as 30% in the fall. Public universities in some other states have speculated that tuition could go up between 10% and 15% next year. Mr. Pals said the driving forces for tuition increases are technology

:+<

upgrades, expenses for library and other educational services, and increasing health insurance costs. “There has been a serious dip in fundraising and substantial losses in the endowment,” he said. “The stock market has gone up, and we project that fundraising will go up in the coming year but it will take a while to make up what’s been lost.” State funding is expected to become a thorn in the side of Ohio’s public universities as state legislators try to plug an $8 billion hole in the 2012-2013 biennial budget. “I think we’ll fare OK in 2012, but I think fiscal year 2013 is going to be really interesting,” Akron’s Mr. Borgemenke said. ■

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Oberlin to unveil new jazz center Oberlin College on May 1 will open the $25 million home of its jazz program. The 36,000-square-foot building includes a recording studio, practice rooms, faculty offices and storage for memorabilia, media and instruments. It is part of a $60 million renovation. ■ PICTURE THIS: The University of Akron has received a $303,000 federal grant to digitize part of a photo collection detailing the history of Goodyear Tire and Rubber Co. The two-year grant from the National Endowment for the Humanities will be used to scan and catalog about 22,500 of the company’s 250,000 photos. The grant will enable the university to inventory the collection, which spans from 1912 to 1984, and to preserve the oldest photos. Goodyear donated the collection to the university in 2008.

Ethical. Entrepreneurial. Engaged.

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Congratulations to The James F. Dicke College of Business Administration, recently named one of the top 111 undergraduate business programs in the U.S. and awarded an A+ in teaching quality by Bloomberg BusinessWeek (2010).

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APRIL 26-MAY 2, 2010

LARGEST COMMERCIAL CONTRACTORS RANKED BY 2009 REVENUE

Company Address Rank Phone/Web site

Local revenue 2009 (millions)

New local contracts 2009 (millions)

# of local projects started 2009

New corporate contracts 2009 (millions)

# of corporate projects started 2009

FTE employees as of 4/1/2010 Local Corporate

Year founded Top local executive

1

Cleveland Construction Inc. 8620 Tyler Blvd., Mentor 44060 (440) 255-8000/www.clevelandconstruction.com

$342.5

$7.1

9

$90.7

24

88 769

1980

Jon D. Small president

2

Gilbane Building Co. 1621 Euclid Ave., Suite 1830, Cleveland 44115 (216) 535-3000/www.gilbaneco.com

$307.5

$360.0

4

$3,010.4

196

71 1,827

1873

Thomas M. Laird Jr. senior vice president, regional manager

3

The Ruhlin Co. 6931 Ridge Road, Sharon Center 44274 (330) 239-2800/www.ruhlin.com

$181.4

$90.0

31

$152.0

45

160 240

1915

James L. Ruhlin president, CEO

4

Fortney & Weygandt Inc.(1) 31269 Bradley Road, North Olmsted 44070 (440) 716-4000/www.fortneyweygandt.com

$113.2

$11.3

34

$117.1

2,006

160 170

1978

Robert L. Fortney president

5

Panzica Construction Co. 739 Beta Drive, Mayfield Village 44143 (440) 442-4300/www.panzica.com

$105.6

$85.0

30

$90.0

32

100 100

1956

Anthony M. Panzica president, CEO

6

The Austin Co. 6095 Parkland Blvd., Cleveland 44124 (440) 544-2600/www.theaustin.com

$73.5

$11.0

4

$21.0

122

83 133

1878

Patrick B. Flanagan president

7

Turner Construction Co. 1422 Euclid Ave., Suite 1400, Cleveland 44115 (216) 522-1180/www.turnerconstruction.com/cleveland

$71.3

$347.0

17

$6,140.0

NA

115 6,161

1902

Mark L. Dent vice president, general manager

8

Donley's Inc. 5430 Warner Road, Cleveland 44125 (216) 524-6800/www.donleyinc.com

$55.5

$103.0

4

$165.4

7

75 110

1892

Malcolm M. Donley president, CEO

9

Continental Building Systems 23230 Chagrin Blvd., Suite 430, Beachwood 44122 (216) 454-0111/www.continental-realestate.com

$27.3

$19.1

13

$115.0

68

16 122

1984

Rick Adante project executive

10

Infinity Construction Co. 18440 Cranwood Pkwy., Warrensville Heights 44128 (216) 663-3777/www.infinityconstruction.com

$23.8

$27.3

28

$27.3

28

28 28

1997

Charles A. Izzo president

11

Drake Construction Co. 1545 E. 18th St., Cleveland 44114 (216) 664-6500/www.drakeconstructionco.com

$16.0

$12.0

47

$12.0

47

40 41

1954

Steve Ciuni president

12

Carmen Construction Co. 417 Commerce St., Tallmadge 44278 (330) 633-4111/www.carmenconstruction.com

$6.3

$6.3

9

$6.3

9

6 6

1950

Joseph R. Scaccio president

Source: Information is supplied by the companies unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are available to purchase at www.crainscleveland.com. (1) Corporate projects number includes roll-out projects.

RESEARCHED BY Deborah W. Hillyer

Doing our part to keep our Great Lake great. The Northeast Ohio Regional Sewer District is proud to protect public health and our environment.

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NORTHEAST OHIO'S TOP SBA LENDERS

RANKED BY DOLLAR VALUE OF 7(A) LOANS IN SECOND QUARTER FY 2010

This Company name year Headquarters

Dollar value of approved loans

Number of loans

1

Huntington National Bank Columbus

26,183,300

139

2

Fifth Third Bank Cleveland

9,307,200

20

3

JPMorgan Chase & Co. New York, N.Y.

5,863,000

47

4

KeyBank NA Cleveland

4,646,300

39

5

CFBank Fairlawn

3,940,000

15

6

Ohio Commerce Bank Beachwood

3,895,000

7

7

Grow America Fund Inc. New York, N.Y.

3,271,000

6

8

Lorain National Bank Lorain

2,975,500

12

9

Citizens Banking Co. Sandusky

2,676,000

6

10

First Place Bank Warren

2,417,000

4

11

United Western Bank Denver

2,103,000

2

12

PNC Bank Pittsburgh, Pa.

2,075,300

8

13

Genoa Banking Co. Genoa

2,065,800

6

14

First Western SBLC Inc. Dallas, Texas

1,965,000

2

15

FirstMerit Bank NA Akron

1,926,100

21

16

The First National Bank of Bellevue Bellevue

1,860,000

5

17

Charter One Bank NA Providence, R.I.

1,627,000

28

18

First Colorado National Bank Paonia, Colo.

1,500,000

1

19

Citizens Bank Flint, Mich.

1,411,600

10

20

First Financial Bank El Dorado, Ark.

1,409,400

1

21

The Henry County Bank Napoleon

1,350,000

1

22

Enterprise Bank Alison Park, Pa.

1,300,000

1

23

Portage Community Bank Ravenna

1,261,000

8

24

U.S. Bank NA Cincinnati

1,233,000

17

25

CIT Small Business Lending Corp. Livingston, N.J.

1,190,000

1

This list was compiled from information provided by the Cleveland District office of the SBA for the second quarter of FY 2010, Jan. 1, 2010 to March 31, 2010. The Cleveland District covers 28 northern Ohio counties. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are available to purchase at www.crainscleveland.com.

Researched by Deborah W. Hillyer

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

17


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APRIL 26-MAY 2, 2010

Internet: Stimulus money boosts efforts The counties with the lowest percentages of unserved households are Cuyahoga County at 0.22%, Lorain County at 0.67% and Summit County 1.74%. Rates increase in more rural areas such as Portage County, 7.25%, and Geauga County, 10.54%. Connect Ohio created the estimates by comparing industry coverage maps to census tract data.

continued from PAGE 1

Some projects are financed by or are seeking public dollars, including grants from the $7.2 billion in stimulus money aimed at increasing highspeed Internet access and adoption. Such subsidies are necessary, according to Jeff Beebe of Connect Ohio, a nonprofit that is helping Ohio counties develop plans to increase the availability and use of high-speed Internet service. Fast Internet access can help businesses make money and governments save money, and over time the Internet is going to become a much larger part of everyday life, Mr. Beebe said. “You have to look long term,” he said. “It’s going to be an investment in the future.” At present, tens of thousands of Northeast Ohio residents don’t have the option to subscribe to reasonably fast “broadband” Internet service provided by cable and telephone companies. About 21,400 households in Cuyahoga and six contiguous counties, or just under 2% of all households in the region, have no broadband access, though they can order slower dial-up Internet service or a more expensive satellite connection, according to figures from Connect Ohio, which is a subsidiary of Connected Nation of Washington, D.C.

Contact: Phone: Fax: E-mail:

Heeding the cry Connect Ohio is working with government agencies and organizations in each of Ohio’s 88 counties to form teams that would pursue projects to expand broadband availability and use. Many of those efforts are still in their early stages, but some counties already have their own projects under way. For instance, Medina County, through its port authority, aims to sell about $14 million in bonds in June so it can construct 157 miles of fiberoptic cable in a figure-eight shape throughout the county. Internet service providers would pay the county to access the lines, which would allow them to provide faster Internet service, said Bethany Dentler, executive director of the Medina County Economic Development Corp. The roots of that project began forming about six years ago, when

feasibility studies showed demand for faster Internet service in the county, Ms. Dentler said. She noted that there’s already almost enough subscriber interest to cover the county’s bond payments. “We’ve talked to some of the major employers in Medina County who are basically crying out for this kind of service,” she said. Portage County Library director Cecilia Swanson, who has worked with Connect Ohio, said she’d like to collaborate with other county groups to form Internet and computer literacy labs. Right now, however, there’s no money for it. Connect Ohio and the State Library of Ohio hope to put some money toward a similar goal: They are applying for two related stimulus grants totaling about $12 million that would pay for new library computers and technology training for Ohio residents.

Long-term investment Separate from Connect Ohio’s efforts, OneCommunity, an organization that provides high-speed Internet access to government agencies, schools, hospitals and nonprofits in Northeast Ohio, is moving ahead with plans to provide Internet training and even Internet subscription subsidies to participants through the

nonprofit’s Connect Your Community program. OneCommunity in March announced it had received $18.7 million in stimulus money to provide such services to poor people in Cleveland, Akron, southeast Ohio and a few cities outside the state. Besides computer literacy training, OneCommunity, through other nonprofits it is working with, will teach participants how to use the Internet in productive ways, such as by applying for jobs, finding health resources and enrolling in educational programs. The group also will help participants figure out how they will be able to afford Internet access over the long term, and it plans to report on the progress they make, said OneCommunity president Scot Rourke. “Years from now, they need to still be using this,” Mr. Rourke said. In addition, OneCommunity plans to crank up broadband speeds in the region while also expanding rural Internet access: The group is applying for about $45 million in stimulus money for a project to expand the fiber-optic network used by Ohio’s state colleges into counties across Northeast Ohio. The network would extend to “anchor institutions” such as hospitals, schools and government agencies and would be available for Internet service providers to lease. Two other organizations have submitted similar proposals for the western and southeastern parts of the state.

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Many of those contacted for this story supported the use of subsidies or government regulation to extend broadband Internet service to people who don’t already have it. In the future, going to the library to use the Internet won’t cut it, said Colleen Nagy, director of the project management office in Case Western Reserve University’s Information Technology Services Department. The university in May plans to start providing super-fast Internet service to about 100 homes on nearby Hessler Street and Hessler Court as part of a one-year research project. Participants will be required to try out Internet-enabled technologies meant to prove their security, health, education or energy use — many of which would not work without a home connection, Ms. Nagy said. While showing off a room that CWRU outfitted with devices meant to illustrate the role the Internet will play in our lives, Ms. Nagy described how the Internet could be used to lock and unlock one’s house from afar, and how it could allow immobilized patients to talk to hospital staff and send in vital statistics such as weight and blood pressure from home. The project will track how participants use the technologies and the fast connection, which one day may be necessary given the growing number of technologies and the spread of video conferencing. ■

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Director of Human Resources Cuyahoga County Public Library Cuyahoga County Public Library seeks a Director of Human Resources to serve as the strategic partner on the executive team of the nationally ranked number 1 public library in the nation. The Library has a staff of 621 FTE and approximately 75% are members of SEIU 1199. The successful candidate must have a BA in human resources or a related field and about 10 years of Human Resources experience with logical career progression and a record of achievement as well as specific experience in a public employment and union environment. The Director of HR will work with the Library's executive team to develop policies, practices and objectives that will provide an employee-oriented, high performance culture that emphasizes empowerment, quality, productivity and standards of employee safety, goal attainment, and the recruitment and ongoing development of a superior workforce reflective of its diverse communities. For the full job description or to submit a resume and cover letter, contact:

Robert Dolan, Interim Director of HR, at hrapplications@cuyahogalibrary.org


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APRIL 26-MAY 2, 2010

CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

19

THEINSIDER

THEWEEK

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

APRIL 19 – 25

There are no secrets, thanks to the Internet

The big story: Steris Corp. reached an agreement with the U.S. Food and Drug Administration on its System 1 liquid chemical sterilization system, which the agency last December said Mentor-based Steris no longer could continue to market to health care facilities. Included in the agreement is what Steris called a “transition plan with a rebate program” for current System 1 customers in the United States. The maker of sterilization products expects the rebate program to result in charges of up to $100 million for the first quarter of fiscal 2011 that will result in a one-time reduction of revenue and operating income on a pre-tax basis.

■ Mark Avsec has written rock songs for Bon Jovi and Donnie Iris — he’s still the keyboardist for Donnie Iris and the Cruisers — that he was happy to see travel the airwaves around the world. However, the Cleveland attorney wishes a letter he wrote recently hadn’t reached the public on the Internet. His latest work, a ceaseand-desist order, was Avsec penned by the Benesch Friedlander intellectual property lawyer for a client, The Wrap, an entertainment web site, and was meant to be read only by representatives of another web site, a news aggregator called Newser. The letter accuses Newser of intellectual property theft. “We demand that Newser LLC, and any agent or affiliate of Newser, immediately cease and desist using The Wrap as a source for Newser content,” Mr. Avsec wrote to the web site’s CEO, Patrick Spain. “Newser is not following industry best practices, is intentionally misleading consumers/users at the expense of The Wrap.” Put another way, the message was: Stop using our reporting and not paying us or even giving us credit. The Wrap hired Mr. Avsec, a well-known intellectual property attorney, to rattle Newser’s cage and try to get Newser to link stories back to The Wrap. The move was scorned by bloggers, many of whom operate in ways similar to Newser. News organizations complain that aggre-

A suitable conclusion: After much negotiating, celebrity activism and pressure from institutional investors, Hugo Boss will keep open its suit-making plant in Brooklyn. Representatives of Workers United SEIU and Hugo Boss reached an agreement to preserve the plant and its 375 jobs. “Against all odds, we have saved a critical U.S. apparel manufacturing facility,” said union president Bruce Raynor in a statement issued jointly with Hugo Boss. Up in the air: Cleveland Mayor Frank Jackson is seeking input from U.S. Rep. Dennis Kucinich about the possible impact on city-owned Cleveland Hopkins International Airport of a potential merger of Continental Airlines and United Airlines. In a letter sent to Rep. Kucinich, the mayor expressed his concern that a merger would cost Cleveland Hopkins its status as a hub airport. The mayor said he is not asking the congressman to hold hearings at this time, but wants his help in figuring out how to best protect the city’s interests because of the economic importance of quality air service to a community.

And then there were three: The Cleveland-Cuyahoga County Port Authority board has whittled down the candidates for its new president and CEO to three names. The finalists are Diane Downing, currently Northeast Ohio district director for U.S. Sen. George Voinovich; William D. Friedman, a consultant to several port authorities and former CEO of the Ports of Indiana; and James H.I. Weakley, president of the Cleveland-based Lake Carriers’ Association, which represents 18 companies that operate cargo vessels on Lake Erie. The Port Authority has been without a permanent leader since last November when Adam Wasserman resigned.

This and that: Alcoa Automotive Wheels, a division of Alcoa Wheel and Transportation Products in Cleveland, was awarded the wheel program for the 2011 Chevrolet Cruze Eco. … Akron General Health System hired Vincent McCorkle as its new president and CEO, effective July 1. Mr. McCorkle has been CEO of Sisters of Providence Health System in Springfield, Mass., since 1997.... The Cleveland Clinic Taussig Cancer Institute received a $2 million stimulus grant to update and expand its translational cancer research labs. The 3,600-square-foot lab originally was built on the main campus in 1928.

MILESTONES

gators such as Newser are not giving readers the opportunity to link back to the original story or sometimes even crediting the original source. Contacted by telephone last week by Crain’s Cleveland Business, Mr. Avsec had a lawyer’s reluctance to talk about his work for a client. “I really don’t even want to talk about it,” he said. “Generally, my letters aren’t posted like that and so I really don’t want to comment on that.” — Jay Miller

AmTrust Financial is no more, at least in name ■ The company formerly known as AmTrust Financial Corp. has a new moniker: AmFin Financial Corp. The name change came about, attorney Christopher Meyer said, because the AmTrust name was an asset of AmTrust Bank. The latter was acquired last December by New York Community Bank after federal regulators closed the troubled bank. Mr. Meyer, an attorney with Squire, Sanders & Dempsey, is representing AmFin in its bankruptcy proceedings. He said the AmFin name was chosen so it would still be recognizable to people who were used to hearing “AmTrust.” “We tried to keep it as similar as we could so people wouldn’t get confused,” he said. All former AmTrust subsidiaries replaced the AmTrust parts of their names with AmFin, he said. — Arielle Kass

The robes aren’t free, but the help is ■ Although the persistent stream of law firm layoffs has dissipated to more of a trickle, there

The consulting firm run by Phil Stella helps business people communicate with more “competence, credibility and confidence.” Mr. Stella says his work for the past two decades primarily has focused on the financial services, health care, manufacturing, media and association sectors. His clients are executives, managers and people who work in sales, customer service and technology. For information, send an e-mail to etcpjs@aol.com. Send information about corporate anniversaries to managing editor Scott Suttell at ssuttell@crain.com.

There’s still work to do before our house is in order ■ There’s more encouraging data about the U.S. housing market, though the mortgage sector remains far from healthy. Those were the takeaways from an April 19 Wall Street Journal story that quoted Lou Tisler, executive director of Neighborhood Housing Services of Greater Cleveland. The Journal reported that the number of mortgage loans that were at least 30 days past due or in foreclosure declined 8.6% in March from February, according to LPS Applied Analytics, which tracks loan performance. The total number of loans that are delinquent or in foreclosure has fallen by more than 647,000 since January, according to LPS. But it’s not quite time to declare good times are back. The Journal reported that more than 320,000 loans that started the year current were at least 60 days past due

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Life is good, but this is better ■ The good life has gone green. The 3-year-old apparel and gift store formerly known as Jake’s Life is Good in Hudson as of last Thursday, Earth Day, became Green Roots Collection. Owners Randy Baun and Patrick Randall said the name change reflected a shift in focus for the store. While the “Life is good” brand of apparel will continue to be sold there, the duo said in a press release they’re placing a growing emphasis on eco-friendly apparel, accessories and gift items, “created with sustainable, organic materials and by fair trade practices.” It didn’t hurt that their Green Roots Collection at the Cleveland Clinic, which opened last November, has done well. The pair also own Jake’s Life Rocks in Rocky River. Eco-friendly merchandise also will be sold there, though its name is remaining the same. — Mark Dodosh

BEST OF THE BLOGS Excerpts from blog entries on CrainsCleveland.com.

COMPANY: Effective Training & Communication Inc., Cleveland THE OCCASION: Its 20th anniversary

are still plenty of attorneys looking for work. Now, imagine being a newly minted lawyer, with all that job-seeking competition on top of your student debt. And perhaps the last thing you want to spend your money on? Regalia to wear as you accept your diploma. The Case Western Reserve University School of Law is seeking to ease the burden, offering to pay half the cost (minus tax) of academic regalia for its 2010 graduates. The robes cost $191.58 to rent; the school will pay $88.80 per student. The number of 2010 graduates is not yet known, but the 2009 class of 209 students would have set the school back $18,559. — Arielle Kass

at the end of March, according to data from LPS. Another reason for caution, Mr. Tisler told The Journal, is that mortgage delinquencies typically fall in February and March as borrowers get their tax refunds. Ms. Tisler, whose group works with financially troubled homeowners, reports that in the Cleveland area, foreclosure filings are on pace to equal the highs of 2008.

NE Ohio’s still a little green when it comes to green living ■ It looks like Northeast Ohioans still have some work to do in living a green lifestyle. The second annual “Nalgene Least Wasteful Cities Study” rates the country’s top 25 metro areas for wasteful behavior; Cleveland is 24th, besting only Houston. San Francisco ranked as the top city for what the study calls “responsible consumption and eco-friendly behavior.” Overall, the study suggests that urban Americans have shown slight improvements in curbing wasteful behavior.


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Crain's Cleveland Business  

April 26-May 2, 2010 issue

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