Crain's Cleveland Business

VOL. 39, NO. 41

OCTOBER 8 - 14, 2018

Akron

Source Lunch

Rubber City is getting notice from Chicago VC firm. Page 24

Zahid Afzal, chief operating officer, Home Savings Bank Page 27

The List

CLEVELAND BUSINESS

Largest accounting firms Page 23

DEVELOPMENT MANUFACTURING

Stanley Black & Decker investment gives local outdoor power equipment maker MTD ‘more tools’ for growth

By RACHEL ABBEY McCAFFERTY

es our presence in the $20 billion global lawn and garden market in a financially and operationally prudent way,” Stanley Black & Decker president and CEO James M. Loree said in a news release about the agreement. “We have always viewed outdoor products as an attractive growth category for us to expand our presence beyond handheld electric products. This transaction gives us the opportunity to do that with a world-class partner.”

MTD calls Northeast Ohio home.

Its headquarters are here in Valley City, and it has a research and development center and manufacturing sites in the state.

Moll said if Stanley Black & Decker decides to exercise its option to

rmccafferty@crain.com @ramccafferty

An investment by Stanley Black & Decker Inc. in MTD Products Inc. gives the companies “more tools in the toolbox,” said Robert Moll, CEO and chairman of MTD. “I know it’s a bad pun, but it really does give us more tools to work with, with brands and technologies and complementary skills, so it’s a very complementary relationship,” Moll said.

In September, New Britain, Conn.-based power tool maker Stanley Black & Decker announced that it had an agreement to acquire a 20% stake in outdoor power equipment maker MTD Products for $234 million. The transaction is expected to close in early 2019. In addition, Stanley Black & Decker will have the option to acquire the remaining 80% of MTD starting July 1, 2021.

“This investment in MTD increas-

A S

Kiser, president and CEO of the Outdoor Power Equipment Institute in Virginia.

SEE MTD, PAGE 8

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buy the remaining stakes in MTD, MTD will have “done our job.” But the company will have to be profitable and innovative and secure its leadership position in the market, he said.

There has been consolidation in the industry, but if Stanley Black & Decker goes through with the acquisition of MTD in the future, it would be of a greater “size and magnitude” than most, said Kris

Illustration by myillo via Getty Images

Aerozone might be set to get off ground

By JAY MILLER jmiller@crain.com @millerjh

The idea of creating an aerospace-oriented job hub around Cleveland Hopkins International Airport and the NASA Glenn Research Center may finally be taking off.

First announced in 2016, the Aerozone Alliance, as it’s called, never moved far off the drawing board. It was stymied by a lack of focus, a lack of funding and a federal research center, NASA Glenn, that did not connect well to the community around it.

The group’s organizers and supporters believe that’s changing.

The mission of the alliance is to create an innovation hub that would attract businesses and jobs to a 15.5-square mile district. The concept, called an aerotropolis, has been attracting interest around the country. It was developed by a University of North Carolina researcher, John Kasarda, who believes the land around major airports, by themselves an economic asset, can be catalysts for additional economic development, similar to a central business district.

Here, the Aerozone Alliance's long-term strategy is to attract both aviation- and aerospace-dependent businesses, distribution facilities and other logistics providers that use the airport, as well as services for air travelers, including global corporations that would benefit from greater access to business services when executives fly in for meetings.

The I-X Center, a mammoth convention hall, also is an attraction the Aerozone could use as a building block.

A study by the Cuyahoga County Planning Commission optimistically forecast “an employment center of 50,000 high-paying technology jobs clustered in the region and communities surrounding Cleveland Hopkins Airport.”

SEE AEROZONE, PAGE 25

Entire contents © 2018 by Crain Communications Inc.

Business of college sports << University

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Analysts say Summa is an intriguing partner

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

Health care industry observers say they wouldn’t be surprised to see Akron-based Summa Health System attract interest from regional, state and national players in its search for a partner.

Industry experts named University Hospitals, the University of Pittsburgh Medical Center (UPMC), Toledo-based ProMedica, Columbus-based OhioHealth and the national HCA Healthcare as possible organizations to work with Summa, which launched its search for a partner at the start of this month.

Short of an outright sale for cash, pretty much all financial arrangements and structures are on the table for Summa as it looks for a partner health system to provide long-term financial stability, advance service offerings and support continued investment in the community’s health.

As a wave of health care mergers and acquisitions sweeps the country (just last week, Cleveland Clinic announced it acquired a three-hospital health system and a separate medical center in Florida), news of Summa looking for a partner didn’t come a surprise to some.

“Providers are able to enjoy several competitive advantages as a result of aligning with a partner,” said Kathryn Hickner, a transactional health care attorney and a partner at Kohrman Jackson & Krantz in Cleveland. “For example, more progressive IT infrastructure, or economies of scale, better negotiat-

ing leverage, also stronger systems to bolster coordination of care, and to improve the quality and efficiency of services provided, those are often the reasons why providers align with one another. The bottom line is that providers align with others in order to better position themselves for success under the changing health care reimbursement and delivery regime.”

University Hospitals While University Hospitals declined to comment for this story, industry observers have suggested that it could be a natural fit to partner with Summa. The Clinic and UH have seemingly been in an arms race for years, acquiring community hospitals throughout the region at a rapid pace.

In 2015, the Clinic acquired Summa’s main Akron competitor, Akron General, and brought it into its network.

“I guess the question would be would University Hospitals want to come into Summit County?” said Allan Baumgarten, a Minnesota-based health care consultant who studies, among others, the Ohio market. “It would in a sense be an extension of the rivalry that they have now in Cleveland between the Clinic and UH and extended into the Akron area. So given the fact that its main competitor has now sort of gained the halo or the prestige of the Cleveland Clinic, I’m thinking that if I was Summa, I would think that it can’t just be anyone who comes in to take us over.”

Tom Campanella, director of the health care MBA program at Baldwin Wallace University, said Summa would be a “logical” potential part-

ner within the region. A key advantage Summa has is its insurance arm SummaCare, which could be a draw for University Hospitals, which several years ago sold off its insurance arm, Campanella said.

“In having a relationship with Summa, they would get access to, as part of that, SummaCare, which I think would be a gem … especially in this day where Medicare Advantage and other plans are becoming major sources of revenue for health care systems,” he said.

UPMC The University of Pittsburgh Medical Center also has a “very strong insurance arm” in Western Pennsylvania, which could bring potential synergy to a partnership with Summa and SummaCare, Campanella said.

Baumgarten also pointed to that overlap in assets. UPMC has been on an “acquisition tear,” in recent years, moving well into Central Pennsylvania, “but maybe they see themselves as entering Ohio at some point in the future,” he said.

Some sort of partnership between the two would create opportunities both on the provider side and the health plan side, Baumgarten said.

Moving into Akron would give UPMC a corridor from Pittsburgh to Akron, with Youngstown and Warren along that corridor, Campanella noted. “Plus UPMC has a children’s hospital, which is a big plus,” he said. “They’ve had, from what I’ve heard, some real strong balance sheets. AndB:10.25” I would think that they would potentially want to look at exT:10.25” panding outside their geographic area.”

Other Ohio systems Campanella said he doesn’t foresee OhioHealth or ProMedica entering the area, “but the one thing I’ve learned in health care: You never say never.”

ProMedica, along with Welltower Inc., a provider of health care infrastructure, this summer announced the completed acquisition of Quality Care Properties, Inc. (NYSE: QCP) and its principal tenants, Arden Courts and HCR ManorCare, a network of short-term, post-hospital services and long-term care with several locations in Northeast Ohio.

Campanella said he doesn’t know if that signals much of anything. ProMedica could just be working to penetrate the long-term care market in the area, “rather than using it as a way to sort of leapfrog into Cuyahoga County.”

Baumgarten, on the other hand, noted that ProMedica, the dominant provider for much of Northwest Ohio, over the years acquired so many hospitals that the government eventually stepped in and forced the system to reverse a merger, Baumgarten said. With limits to its ability to add more Northwest Ohio hospitals, the system began adding facilities in Southeast Michigan, and Baumgarten wonders if that could mean ProMedica will turn its sights toward Northeast Ohio next.

Columbus-based OhioHealth has been moving north and east toward Cleveland, reaching as far as the Mansfield area, he said.

“OhioHealth keeps expanding its geographic footprint and might see an opportunity there to sort of break

into Northeast Ohio in a big way with some kind of venture with Summa,” Baumgarten said.

National systems The range of possible partners also includes national, for-profit entities, such as HCA Healthcare and Tenet Healthcare. Campanella noted that Tenet typically focuses “a little bit more on some of the rural areas,” but noted that the big growth area for the for-profit health care industry is in the outpatient arena.

“So to have or establish the collaborative relationship with an organization that has a real strong experience in the outpatient side from a number of different perspectives, I think would be a potential partner for Summa,” he said.

As for HCA, Baumgarten noted there have been several examples of the organization going into a market and entering into 50/50 ventures with nonprofit health systems.

“HCA hasn’t been looking in the Rust Belt, hasn’t been looking much in the Northeast,” he said. “Most of its recent acquisitions have been in states where it’s already really strong, like Florida and Texas. But this is a company that’s always looking for opportunities and they might see Northeast Ohio as an opportunity.”

While Baumgarten and Campanella named several potential partners for Summa, neither had a strong sense of what the partnership will ultimately look like. Campanella said it’s wise for Summa to stay open-minded and look at all forms of offers on the table.

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Weston, a large Warrensville Heights-based real estate owner, is ready to launch a $7 million construction of a multitenant warehouse at Lost Nation Airport in Willoughby.

With the project, Weston adds a second industrial development project to its to-do list, this one in Lake County, while the other is its pending purchase of a 20-acre site from the city of Cleveland at Madison Avenue and Berea Road. The projects are the first multitenant projects for Weston’s own account since 2007 and mark renewed emphasis on its roots after a foray into the apartment market.

The 130,000-square-foot industrial building, which will be built on a speculative basis without committed tenants, is on more than 10 acres the real estate concern leased from the Lake County Ohio Port & Economic Development Authority, according to Mark Rantala, the port’s executive director. The authority owns the airport.

Suzanne Broadbent, who carries the dealmaker title and is a member of the Asher family that owns Weston, said in a phone interview that the company sees value in taking a risk on a project in Lake County.

“We see that there are tenants looking for space in that area, so we can build it and fill it,” Broadbent said. Weston owns industrial properties in Mayfield Village and Solon in the suburban market and has a 92% occupancy rate in its portfolio.

“The market is good. We’re enjoying it while we have it,” she said.

Weston expects to finish the project in the summer of 2020.

Rantala estimates the industrial market in Lake County has just 3% vacancy, and he said the shortage of

This 400,000-square-foot building in Diamond Business Park in Glenwillow was purchased by Plymouth Industrial REIT for $27 million. The structure was developed by a joint venture of Weston Inc. of Warrensville Heights and Geis Cos. of Streetsboro. (CoStar)

space crimps economic development efforts. He said he hopes Weston undertaking the project and leasing it at current rents provides incentive for more real estate developers to look at adding more such projects in the county.

“We don’t have much newer, multitenant industrial property in the county because most of the properties were historically built for users and later converted to multitenant use,” Rantala said. He maintains the county could likely support another four buildings of comparable size.

The project adds a Lake County offering to new rental industrial projects in the region, ranging from Twinsburg and Euclid to Strongsville and Sheffield Village.

The port contacted multiple developers until it identified a company interested in pursuing the project.

The site at 38585 Jet Center Place is part of the airport’s land holdings but is not needed for aviation services,

Rantala said.

The East Side project surfaced as Weston is in the last throes of acquiring the vacant, industrial-zoned site at West 110th Street and Madison Avenue for another project.

Cleveland City Council last month adopted legislation authorizing Mayor Frank Jackson’s administration to negotiate a sale of the brownfield site to Weston. Councilwoman Dona Brady, whose Ward 11 includes the site, said the sale is awaiting the execution of a contract for the sale.

If Weston bags the site where Midland Steel once operated, it plans to construct a total of 350,000 square feet of rentable space in three buildings, according to documents council received.

Broadbent declined comment on the Cleveland site.

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reshoring of manufacturing operations and more federal tariffs — is putting Weston back to its roots developing industrial properties after a high-profile sortie in the apartment market.

The company opened The Standard, a $60 million, 300-apartment remake of the former Standard Building at 99 W. St. Clair in downtown Cleveland last January, but never proceeded on plans it announced in 2015 to build multiple apartments on a 7-acre sea of parking lots it owns northwest of Public Square.

Broadbent declined comment on the languishing plan to build apartments on the major downtown site, but said the company is at 60% occupancy at The Standard.

“We’re real happy with the way things are going at The Standard,” she said. “We’re about to add the penthouse floor to the market, and our next task is to get the first floor retail space leased.”

Weston is known as a company that buys or builds and holds, but recently parted with a big building. In late September, it sold for $27 million the multitenant industrial building at

30339 Diamond Parkway, Glenwillow, to Plymouth Industrial REIT, a Boston-based industrial trust.

Broadbent said Weston, and Streetsboro-based Geis Cos., its partner in the 400,000-square-foot building they constructed in 2007, had not been marketing the structure when Plymouth REIT approached them about buying it.

“The opportunity presented itself and we decided with our partner to sell it,” Broadbent said. “We’re still not sellers. We’re landlords.”

And Weston owns a lot of properties. The 50-year-old family company has holdings in nine states and a portfolio with 13 million square feet of rentable space, most of it industrial.

Correction JJA Sept. 17 story misstated the number of plastic straws and stirrers restaurateur Sam McNulty’s establishments used annually before joining Sustainable Cleveland’s “Skip the Straw” campaign. His restaurant portfolio typically used several thousand each year, but has cut that number in half via paper straws and wood cocktail stirrers.

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Following nearly two years of rapid growth, Brecksville-based health care IT company MediQuant has received a “significant” growth investment from Silversmith Capital Partners, a Boston-based growth equity firm.

The two are not disclosing the amount of the investment, but MediQuant officials say the partnership will help it scale up the organization and develop new products.

“This investment will allow us to continue delivering market-leading archiving solutions with a clear focus on long-term customer success and satisfaction,” said Tony Paparella, chairman and founder of MediQuant, in a prepared statement.

MediQuant, which focuses on hospital data “active archiving” and interoperability solutions, has doubled its revenue and its customer base in less than two years, said Jim Jacobs, who was promoted to CEO as part of the transaction. His previous role was president and chief operating officer.

“Active archiving” is different from simply a backup system in that it allows for physicians and others to continue to access the data.

MediQuant serves nearly 200 individual health systems, representing more than 1,000 hospital and physician practice customers, according to a news release.

“We help hospitals and health care providers, organizations, sort of what I call health care enterprises solve the problem of what do they do with legacy data and overall data manage-

ment solutions,” Jacobs said.

According to the release, MediQuant — which offers active archiving software and legacy decommissioning services for ERP, clinical, financial and revenue cycle software platforms — has generated hundreds of millions of dollars in savings for hospital and health system customers since it was founded in 1999.

Jacobs points to two big changes in health care that have driven more providers to turn to MediQuant for its services: the “tremendous” amount of acquisitions in health care and hospitals’ efforts to standardize or consolidate their data platforms, such as electronic medical records (EMRs).

“And that then leaves the executive teams with the question of what do we do with all of the data that we have that’s extremely valuable, that might be in a variety of systems or older systems,” Jacobs said.

In the past year, the number of employees at MediQuant has grown by 30%, Jacobs said, though he would not give specific figures.

Silversmith Capital Partners does growth investing in two primary sectors: health care and technology, or in many cases, an overlap of the two.

Jeff Crisan, managing partner of Silversmith, said that the team at the firm grew to appreciate that “MediQuant was the clear leader in its space.”

“MediQuant is addressing a very immediate and acute need that hospital systems have in how they handle all the diverse data archiving challenges that they currently face as they’ve adopted more modern EMRs,” Crisan said, noting that MediQuant is “very well suited” to solve these problems.

Crisan and Nikhil Marathe, a vice president at Silversmith, have joined MediQuant’s board of directors, along with Paparella and Jacobs.

Jacobs said one of his goals in partnering with Paparella was to build the company in a way that would allow for opportunities or choices, depending on the market and how they wanted to grow business.

“We had some conversations with Silversmith, and based on their view of the world, their track record in health care, what they’re trying to accomplish, what we’re trying to accomplish, a great partnership formed out of that, including the investment,” he said.

Jacobs stressed the two are “truly partnering” to propel MediQuant toward further success.

“They are advisers; they work with us on what needs to be worked with; they’ve given us access to their network and to their resources,” Jacobs said. “And through the capital investment, that is a resource for us to accelerate our growth plans.”

He said the company could “easily” grow its employee base by another 20% with this investment. MediQuant is also looking to expand its product portfolio and has been looking at getting into other data management solutions in health care, such as system conversions.

Crisan also noted that overall management of data around hospitals and health systems is a “big growth area” beyond active data archiving.

“Our investment really helps catalyze the strategic direction that Jim and Tony were already taking the business,” Crisan said.

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Mapping out the next generation of leadership, was the topic on everyone’s mind on Wednesday, Sept. 12. This terrain can be tricky to navigate, but looking ahead proved to be a great path for the Crain’s Family Business Forum keynote panel, composed of Christopher Buehler, Rich Fishburn and Mark Klingbeil. “The Buehler’s Story” lined up advice, connections and familiarity for attendees.

Additionally, Busch Funeral Homes, which is in its fourth generation, was awarded the 2018 Longevity Award from the Ahola Corp.

Following a networking session, attendees heard from Team NEO, which presented a regional economic update. The Family Business event wrapped up with a panel discussion on “Best practices — and biggest potential pitfalls — in succession planning.”

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CONTINUED FROM PAGE 1

The outdoor power equipment industry isn’t a large one. It’s a housing- and weather-dependent business, Kiser said, and demand has been pretty steady. The institute has about 100 members across the globe, including the two companies in question.

For now, the two companies are still operating independently, though Stanley Black & Decker would have board representation at MTD. But Stanley Black & Decker’s stake in MTD would solidify the companies’ relationship and allow them opportunities to work together more closely.

Moll declined to share annual sales (the news release noted revenues were above $2 billion in 2017) or employee numbers for MTD, but he sees this as an opportunity for growth.

The two companies will be able to leverage one another’s retail portfolios and expand who they’re selling to.

MTD sells to a lot of independent retailers, which is a market Stanley Black & Decker has not cultivated, Moll said.

And while MTD is known for brands like Cub Cadet and Troy-Bilt, its “roots” are in private label manufacturing, Moll said. That includes private label manufacturing for Craftsman, which Stanley Black &

“Those are platforms that Stanley Black & Decker doesn’t have, and they are opportunities for us to change the fuel source to leverage the skills of both companies.”

— Robert Moll, MTD CEO and chairman

Decker bought in 2017.

Overall, the investment from Stanley Black & Decker will create “some stability in an important part of our business,” Moll said.

Another way this could affect manufacturing at both companies is by taking advantage of what Moll called

“interesting sourcing opportunities” in terms of materials used and the sharing of technology. Electrification is a trend in the outdoor power equipment market, and working with a company with the capacity and scale of Stanley Black & Decker could be a benefit as MTD works to add electric power to more of its products. Moll said, right now, he’s seeing that in smaller products, like hedge trimmers, but he knows the time will come when the market moves toward putting electric power in larger products like lawn mowers and snow throwers.

“Those are platforms that Stanley Black & Decker doesn’t have, and they are opportunities for us to change the fuel source to leverage the skills of both companies,” Moll said.

Kiser said the outdoor power equipment industry tends to follow the automobile industry, so he’s seeing a lot of hybrid products and a lot of electric products right now. He also sees lithium ion batteries in commercial markets as a significant trend.

And there are opportunities for MTD and Stanley Black & Decker to work together in other ways. Already, the companies have been collaborating on a Craftsman electric-start mower that combines an MTD walk-behind engine with a Stanley Black & Decker battery, Moll said.

“So, there will be technology sharing that we have just started to tap into,” he said.

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CRAIN’S CLEVELAND BUSINESS

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‘Right people’ are key to KPMG’s growth

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

For Big 4 firm KPMG’s newest leader in the Cleveland market, growing the business largely boils down to one key strategy: finding, and keeping, the right staff.

Jim Mylen, 47, a 14-year veteran of KPMG and a native of Cleveland Heights (where he lives today), was named managing partner of the firm’s Cleveland office effective last Monday, Oct. 1. He takes over the role from John MacIntosh, who had held the position since June 2007 but is transitioning his focus to working as the firm’s national sector leader for consumer goods.

MacIntosh will remain based in Cleveland.

Mylen, a veteran of the audit side of the business, most recently served as the advisory office leader for Ohio, Indiana and Kentucky.

Obviously, growing the office is Mylen’s top priority, and he says the firm has been setting the stage for that growth in the past few years in this market by adding supply chain operations and services like international tax capabilities. Much of that is in response to needs in this market, where companies, like elsewhere in the United States, have become increasingly global.

The accounting sector also is bolstered by a more complicated business environment. New regulations, cybersecurity needs and tax laws all create a landscape more friendly to the accounting business for companies in the middle market that KPMG tends to focus on — and Northeast Ohio has a “pretty robust” middle-market segment for the firm to serve, Mylen said.

So better serving clients with new services on top of what they already buy while drawing new business is a given for any firm. The implementation of automated process, big data and cybersecurity are all part of that strategy for every large professional services firm in today’s world. And the same can clearly be said for KPMG. What’s more telling, though, is Mylen’s views on how it will actually execute on growth plans.

And it comes down to people.

Mylen said that a headwind to growth is simply finding good workers, training them properly and keeping them around.

His office currently has 180 total professionals, 95 of whom are CPAs. While those figures have been effectively static the past couple years, according to Crain’s research, they rank among the top five accounting firms in this market by number of in-market CPAs. Mylen said there are no goals for hiring people, or to grow to a certain size. The firm also does not disclose revenue growth or goals by office. So what targets it wants to hit in the future are unclear, though it does intend to add “resources and people” over time, he said.

Mylen’s perspective echoes what’s being felt throughout the rest of the accounting field today: pressures to find the right talent.

That’s something being felt for a few years now. Firms increasingly target students at younger ages in college — and even as young as high school when students express an interest in the field, as Crain’s reported last year — and KPMG has stepped up its on-campus recruiting efforts, Mylen said, where

P009_CL_20181008.indd 9

they’ll attempt to woo even freshmen and sophomores. Some of that simply involves explaining what kind of jobs those kids could have in the accounting field and emphasizing that it doesn’t exclusively means working in taxes.

“People do seem familiar with audit and tax,” Mylen said. “But everything we’re doing is making sure they know about other opportunities in the firm. Programs we develop build that awareness and create some excitement with students so they know opportunities do exist to join a firm like KPMG and have opportunities beyond traditional tax.”

But Mylen acknowledges that competition for people is fierce.

“The biggest headwind is the competition for talent and making sure

“The biggest headwind is the competition for talent and making sure we have the right talent, the right skill sets, on our team.”

— Jim Mylen, KPMG managing partner

we have the right talent, the right skill sets, on our team,” he said.

Indeed, according to the 2017 PCPS CPA Firm Top Issues Survey (from the American Institute of Certified Public Accountants), accounting leaders across the sector over-

whelming reported that despite all the changes to the business and all the concerns with automation, cybersecurity and other factors, finding and retaining top talent would be their biggest challenge in 2018.

Mylen and KPMG are keeping

their cards close to the vest and wouldn’t talk much about specific recruiting strategies or other incentives being offered to draw and retain quality staff.

And when asked about the firm’s place in the market, where it faces stiff competition from all other Big 4 firms — Ernst & Young far and away has the biggest presence here of all of them — plus other growing national firms, like BDO, which entered Northeast Ohio via acquisition in 2014 and is about the same size as KPMG here, Mylen said he doesn’t fixate much on numbers.

“But if we attract the right people, provide quality and continue to innovate, we will continue to win in the market,” he said, “and everything else will take care of itself.”

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PA G E 10

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CRAIN’S CLEVELAND BUSINESS

Opinion From the Editor

Skills gap survey needs your input

Editorial

Fair tradeoffs It could have been much worse.

That’s our reaction, from the perspective of free trade advocates for the export-heavy Northeast Ohio economy, to the initial outlines of NAFTA 2.0, officially known as the U.S.-Mexico-Canada Agreement.

President Donald Trump during his 2016 campaign for the White House frequently lambasted the ’90s-era trade accord as a “disaster” for the United States. Immediately upon taking office, he pulled the United States out of the 12-country Trans-Pacific Partnership. And the messy process of getting to a new agreement with our neighbors to the north and south — particularly with respect to Canada, Ohio’s most important trading partner — raised the prospect of weakened economic ties among the three parties.

Instead, the new USMCA makes relatively modest revisions to the previous deal governing the relationship of three countries that trade more than $1 trillion annually.

In a perceptive column in The Wall Street Journal, columnist Greg Ip wrote that the new deal “is a bitter pill to swallow” for free traders, since it “introduces managed trade to autos, waters down the foreign rights of corporations and normalizes national security as a pretext for tariffs.” But on balance, he argued, the USMCA “shows the limits” to the president’s “America First” agenda, as “the resistance Mr. Trump encountered from Congress, business, his own advisers and U.S. trading partners circumscribed his leverage and may again in the future.”

The result is a deal that’s a little bit from Column A to make business happy, and a little from Column B to make labor happy.

A Washington Post analysis, for instance, pointed out that the agreement “stipulates that at least 30% of cars (rising to 40% by 2023) must be made by workers earning $16 an hour, about three times the typical manufacturing wage in Mexico now.”

USMCA also stipulates that Mexico must make it easier for workers to form unions, and that automakers must raise the portion of their content that must originate within the region to 75% from the current 62.5%.

Those are some significant concessions to labor concerns, though Politico reported that the heads of five major unions, including AFL-CIO president Richard Trumka and United Steelworkers president Leo Gerard, are skeptical of the USMCA and believe it “might not amount to a significant improvement for American workers.”

Businesses, meanwhile, will benefit generally from the modernization of trade rules, particularly in intellectual property and trademark and patent proviThe result is a deal sions. Canada also made some important concessions that’s a little bit in offering the U.S. expanded access to its dairy market, from Column A to which has been heavily promake business tected. (This could be a parhappy, and a little ticularly important aspect of the deal for Ohio.) from Column B to The contours of the deal, make labor happy. then, look a lot more like old-style Washington — some for you, some for me — than the scorched earth style of negotiating that has come to dominate our politics of late. Some of the credit for that goes to U.S. Trade Representative Robert Lighthizer, an Ashtabula native who has shown a willingness to work with Democrats — U.S. Sen. Sherrod Brown of Cleveland prime among them — to craft trade deals that address some of their concerns.

Sen. John Cornyn of Texas, the Senate’s No. 2 Republican, said last week that it’s “not a foregone conclusion” that the new trade pact will win confirmation, and that the earliest the Senate could pass the measure would be after the Nov. 6 midterms, during the lame-duck session before the next congress begins in 2019. More likely, it will be considered by members of the next congress.

That’s OK. There’s no rush. These deals are complicated and should be examined closely. But we’re pleased so far by what looks like a reasonable compromise.

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com)

CLEVELAND BUSINESS

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Managing Editor:

Scott Suttell (ssuttell@crain.com)

Contact Crain’s

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Read Crain’s online: crainscleveland.com

Do you have jobs available you aren’t able to fill with qualified workers? If you do, you’re not alone.

Crain’s Rachel Abbey McCafferty reported last week that 99% of manufacturers surveyed by Tooling U-SME said finding skilled new workers is a problem.

That’s not just a talent gap, it’s a canyon.

And it’s not limited to manufacturing. In the same issue of Crain’s Cleveland Business, Stan Bullard wrote that securing skilled workers is the chief concern in Northeast Ohio’s construction and real estate industry, according to a recent Skoda Minotti survey.

How is your industry faring in today’s tight labor market? Are you having difficulty recruiting for certain positions?

Elizabeth College Now Greater Cleveland wants to McIntyre hear your experiences as part of its “Bridging the Talent Gap” survey, which it’s conducting in partnership with Team Northeast Ohio and the Cleveland Indians (who, by the way, have all the talent they need to bring home the World Series this year ).

The goal of the survey is to identify skills shortages employers have in the region. The information will help policymakers, educational institutions and training providers to better understand the employment landscape and to take targeted action.

“We hope to get the whole community involved to fulfill The survey is workforce needs,” said Julie Szeltner, director of adult programs confidential and and services for College Now. results will be “We hope awareness will lead to collaboration with willing em- reported only in ployers, educational institutions aggregate. and others.”

The survey, which employers can find and fill out at https://bit.ly/2NlSz2Q, is confidential and results will be reported only in aggregate. A survey takes 20 to 30 minutes to complete, Szeltner said.

The survey is the product of the Graduate Network, a Philadelphia-based nonprofit that works to increase the number of adults who complete college. It has conducted similar talent gap surveys in Kentucky, Tennessee, Spokane, Wash., and other communities. The organization recently received a grant to conduct surveys in four additional areas: Cleveland, San Antonio, Kansas City and Rhode Island, Szeltner said.

Crain’s recognizes the skills gap is an important issue that many employers in Northeast Ohio are struggling with, which is why we are urging companies to participate in the “Bridging the Talent Gap” survey.

A bridge in Kentucky or Kansas City might not be the right bridge in Cleveland. The more we as a community can understand the issue, the better equipped we will be to address it. We need to know how wide the gap is, and what specific skills are lacking, and, eventually, why. Only employers with jobs to fill can accurately provide that information, so, please, consider participating.

You can also hear how several local companies are tackling skills gap challenges head-on and brainstorm with fellow attendees on best workforce development practices at the Crain’s Manufacturing Assembly on Tuesday, Nov. 13 at Corporate College East.

To learn more, visit https://bit.ly/2BUktAZ.

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Cleveland Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by emailing ClevEdit@crain.com. Please include your complete name and city from which you are writing, and a telephone number for fact-checking purposes.

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com.

Please include a telephone number for verification purposes.

10/4/18 4:46 PM

CRAIN’S CLEVELAND BUSINESS

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Personal View

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An employee cooks in the kitchen of the EDWINS Leadership & Restaurant Institute in Shaker Square.

EDWINS teaches people how to embrace a second chance through job skills. (TFL Films LLC)

HOUSE OF WINDOWS

For a second chance, first business must find its heart

By BRANDON E. CHROSTOWSKI

It was in Birmingham, Ala., 1963, that a painful lesson was again learned about the business community and its general failure to partner with community action groups in favor of social justice.

Rev. Martin Luther King Jr. had again been charged and imprisoned for leading mass demonstrations protesting for racial desegregation, equal public education, and the very right of African-Americans to stroll, shop, drive and buy homes in any part of the city they chose. From his cell, King scratched away and managed to produce his renowned “Letter from the Birmingham Jail” — written with broken pencils on smuggled-in bits of paper.

King’s words At one point, King wrote about the deceit and evasiveness of the corporate community: “As the weeks and months went by, we realized that we were the victims of a broken promise. As in so many past experiences, our hopes had been blasted, and the shadow of deep disappointment settled upon us. We had no alternative except to prepare for direct action, whereby we would present our very bodies as a means of laying our case before the conscience of the local and the national community.”

King’s stirring missive earned him the 1964 Nobel Prize. Most everyone knew that he was right, yet too many paid no attention to him or their own consciences.

A legacy of failed moral partnerships in Cleveland In the mid-1990s, Bishop Anthony Pilla (now retired) of the Cleveland Catholic Diocese personally spearheaded the “The Church in the City” campaign.

Pilla, joined by clerics from other denominations, pleaded with the city and its commercial community to invest in the declining urban center of the city. After some initial spurts, the program quietly receded and disappeared. This old pattern is a tiresome truth in our city — one that still exists to this day.

I recently visited one of the largest businesses in town. I was concerned about how this company viewed its role in creating social change. My hope was that this firm — and all corporations — would be mindful of its opportunity to be ethically responsible in this category. Every human being has the right to a fair and equal future despite their past, don’t they?

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Alas, their vision was limited to possibly hiring “one or two people with a criminal record” and to “give them jobs in food prep.”

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These men were not trying to insult. It was completely natural for them to equate a tarnished past Chrostowski with impending failure. The reality quickly set in that despite whatever success we’ve had, we’re not there yet.

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A second chance brewing It is noteworthy and gratifying that an escalating number of visitors have been choosing Cleveland as a travel or holiday destination. However, not all these folks are arriving just to see the Rock & Roll Hall of Fame, Playhouse Square, the Cleveland Museum of Art and numerous other world-class attractions.

People are journeying from far and wide because they are inspired by a second chance. Cheyenne, Wyo.; Pasadena, Calif.; Rochester, N.Y.; Ottawa, Ontario; Detroit; Washington, D.C.; Fort Lauderdale, Fla.; Nashville, Tenn.; Huntsville, Ala. and beyond. I am a witness to this: From around the country they come because of the difference men and women at EDWINS are making in the face of the blatant inequity that plagues our country. They travel to taste the truth, and we offer them a bridge to the business of change and of healing.

It has been truly satisfying to note the new, if tentative, direction of Cleveland. Many supporters give beyond their means because they know it will make a difference. They cheer on our EDWINS students who work outside their comfort zone because they know it will change their course. There is a tremendous amount of energy in Shaker Square that prophesies we can change the world in which we live.

When founding EDWINS, I was focused not upon patronizing, but upon teaching people — with learned skills, non-judgment and mercy — how to embrace a second chance. We believe Cleveland is full of people with fair perspectives that can enrich this city’s potential. As a living community, we should not equate prison, poverty or race with an inability to achieve. That’s our business.

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10/4/18 4:32 PM

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CRAIN’S CLEVELAND BUSINESS

‘Strong’ CBIZ poised for marketing push “There’s no question if you look at the business climate today, it’s never been more favorable for the types of services we provide.”

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

CBIZ Inc. — one of the 10 largest accounting firms in the U.S. and a rare one in its class for being publicly traded — has been on quite a winning streak lately under the leadership of president and CEO Jerry Grisko.

It logged $720 million in 2017 and has been growing at a clip of about 10% a year, a rate it has maintained so far through 2018. That puts it right on track to hit $1 billion in the coming years, which is a target Grisko had in mind when he stepped up as its top executive in 2016.

CBIZ stock, now trading around $23, has doubled in the past two years. It’s of little surprise the firm has drawn new analysts in 2018.

The company feels the time is right to embark on a new, national brand awareness campaign, but not just because CBIZ has a good story to tell.

The need for accounting services in today’s market, which is rife with change under shifting regulations, new tax codes and increasingly global businesses, can’t be understated.

Complexity is good for this kind of industry, and it’s creating fresh opportunity for professional services.

“There’s no question if you look at the business climate today,” Grisko said, “it’s never been more favorable for the types of services we provide.”

The firm launched a national marketing campaign, with a slant toward television ads on channels like CNN,

full force investing in various kind of media outlets to get the name out,” he said.

Even midsize and local firms, such as Akron-based Bober Markey Fedorovich, has “significantly” expanded its marketing budget this year, said the firm’s chief operating officer, Karyn Sullivan. The strategy there is specific to educating clients on the firm’s growing areas of expertise.

“But (CBIZ) have really elevated their game and their brand within the profession,” Koltin added. “They are out there from an awareness standpoint nationally much more than I have ever seen before. They have been the winners of some very competitive acquisitions. And whether it’s their profitability or stock price, it’s going through the roof.”

Beyond general brand awareness, part of the strategy with all firms is to remind the market how the industry and its firms are evolving. There is a greater focus on breadth of services, which is driving firms to build out consulting, advisory and outsourced services and simply do more for clients.

That’s largely a function of the market today. Many ads will recognize the companies’ changing needs, including the need for guidance with evolving regulations and tax codes.

A strong economy also doesn’t hurt the equation. Beefier corporate balance sheets are helping create this friendlier climate for the accounting sector because they are devoting more resources to those services.

“In good times, which the accounting profession is in right now, there’s more propensity for things

— Jerry Grisko, CBIZ Inc. president and CEO

MSNBC and Fox, around August. It long has done some amount of advertising, but not to the same scale as today. There’s about $1 million to $2 million behind the current campaign, which will run through the end of this year and pick back up in the spring and fall of 2019.

“We believe we are in a very strong market position right now.

It’s time to tell our story to the world.”

— Mark Waxman, CBIZ’s chief marketing officer

“For a decade, we haven’t really done any kind of major brand awareness. So why now? It’s a combination of market timing and our timing. We believe we are in a very strong market position right now,” said Mark Waxman, CBIZ’s chief marketing officer.

“It’s time to tell our story to the world.”

Allan Koltin, CEO of Koltin Consulting Group and an adviser to the accounting industry, said the 15 largest firms are putting more work into their marketing strategies, so what’s going on with CBIZ is reflective of other firms of its ilk.

The Big 4 have always been particularly active marketers, he said, but now everyone in the larger end of the accounting sector is stepping their game up. (CBIZ falls at No. 10 in the list of the largest accounting firms by revenue, according to rankings by Accounting Today.) That’s noteworthy, in part, Koltin said, because accounting firms weren’t permitted to advertise until the early 1980s.

“Here we are four decades later, and accounting firms are finally in

like market share,” Koltin said. “If it were 2008, you wouldn’t be hearing about rebrandings or marketing campaigns or spend to support them.

In 2018, that lines up great.”

Koltin, who’s based in Chicago, said he now sees accounting firm ads throughout the day on TV. Then there are the radio ads on the commute to work. Then he gets to his office, opens up Crain’s Chicago Business, and catches more ads from national firms plugging themselves in the local market.

“Everyone in this echelon is (advertising) right now,” he said.

So market conditions are favorable, and that’s creating new opportunity to provide more work to existing clients while wooing new ones.

It’s less about price points today and more about the value of the services.

But there’s also some unique elements to the marketing play for CBIZ. The firm has been an active acquirer of other businesses as part of its growth strategy. And the company reported in fall 2017 that it had $142.5 million on hand for acquisitions going forward.

As the firm grows, the campaign is designed to create as much awareness with target companies and potential hires as it is prospective clients.

CBIZ certainly wants to stand out to clients, Waxman said.

“But we do have an acquisition strategy and do believe this will impact our ability to acquire because it makes them aware of us, and everyone wants to be a part of someone who’s well known,” Waxman said. “So it’s a double positive.”

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Enrollment drops continue at NEO schools

By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com @ramccafferty

It’s not exactly surprising to see pretty flat enrollment at Northeast Ohio’s colleges and universities. The shrinking high school population the schools draw on has been well publicized, and there’s only so much schools can do to grow in that kind of environment.

Of the four-year publics in the region, Youngstown State University was the only university to see a yearover-year increase this fall. For the two-year publics, that honor goes to Stark State College. Both grew headcount by less than 1%, according to numbers provided to Crain’s. (A note: The colleges and universities provided their own numbers, and the way they calculate total enrollment can vary.)

Of the 15 private colleges, universities and institutes surveyed, seven reported increases and eight reported decreases.

The school in a category all its own, the Northeast Ohio Medical University, saw an increase of about 1.3%.

While few of the increases were eye-catching, some of the decreases were. Take, for example, Notre Dame College’s approximately 11.7% decrease.

As of Sept. 14, Notre Dame College saw the total number of its degree-seeking students, which includes part-time and full-time students, decline from 1,661 in fall 2017 to 1,466 in fall 2018. The college in South Euclid is trying to “rightsize,” so it can better support the students it has in retention and graduation efforts, said Beth Ford, vice president for enrollment.

Chief communications officer Brian Johnston said it’s one thing to look successful by setting and meeting enrollment quotas, but Notre Dame realized a lot of its students weren’t staying.

“We’ve got to be the right fit for the person coming in,” Johnston said. “So it’s not just a matter of, ‘You meet the basic requirements, we’ll take you.’ ” Overall, the college is re-evaluating all of its on-campus offerings, from its extracurriculars to its academics, to make sure it is serving students best it can. Johnston said the college may come out of this process with restructured academic areas and, maybe, fewer majors.

Notre Dame College is far from alone in this process. There’s a similar story underway at the University of Akron, which this year reported an approximate 7% decrease in enrollment and announced programs it planned to phase out and those it wanted to invest in.

The university knew it would see a decline in enrollment when it fully implemented its stronger admission standards, which happened this year, said Wayne Hill, vice president and chief communication and marketing officer. The standards had been phased in over time. An email from the University of Akron noted that nearly 600 students who would have been defined as preparatory students were deferred from the main campus because of the new standards. Akron has also faced the ramifications of what Hill called the “significant drop” in freshmen enrollment in fall 2016.

Investing in areas students are interested in is a clear strategy for campuses struggling with enrollment.

That’s the approach Ursuline College is taking. After a few years of declining enrollment, the women-focused college is making sure the programs it’s offering are relevant, providing marketable skills and leading to careers, said Kathryn LaFontana, vice

P013_CL_20181008.indd 13

president for academic affairs.

This year, Ursuline College in Pepper Pike reported an enrollment decline of about 4.5%. Undergraduate enrollment saw a small increase, but that was offset by a drop in graduate enrollment, where programs like the college’s master of science in nursing struggled as LaFontana said providers changed standards.

One area that LaFontana said saw strength — and that, subsequently, the college is looking to invest in — is accelerated programs, like its second-degree nursing program.

“So what we’re seeing is that the accelerated programs, the programs that allow students to finish more quickly and finish a program and move on, those seem to be the ones that are growing the fastest,” LaFon-

“What we’re seeing is that the accelerated programs ... seem to be the ones that are growing the fastest.”

— Kathryn LaFontana, Ursuline College VP for academic affairs

tana said.

Ursuline is in the process of restructuring its MBA program and is looking to add some fast-track programs.

Another challenge universities have faced is a decline in international enrollment, a struggle cited by both the University of Akron and Kent State University.

Kent State’s less than 3% enrollment

decline wasn’t as sharp as Akron’s, but a drop in international enrollment still hurt. Executive vice president and provost Todd Diacon attributed about half that decline to international enrollment. (The other half he attributed to something that’s a positive for the university overall: More students are graduating and graduating faster than they’re being replaced.)

Diacon said some of those reasons are based in foreign government decisions, like China encouraging students to attend school there, he said, and others, like an increase in visa denials to students from India in recent years, were domestic. And Diacon said the White House’s new “geopolitical approach” has given many the impression that the U.S. isn’t as open to international students.

To counteract the forces contributing to a decline, Kent State is doing more to diversify the countries from which it’s drawing international students, Diacon said. And it’s doing more to offer educational opportunities in other countries. For example, about two years ago, it began encouraging non-degree-seeking international students to spend a semester at its program in Florence, Italy. And it recently entered into a partnership with the Pontifical Catholic University of Parana in Brazil to offer the American Academy. Kent State provides the instruction and the Pontifical Catholic University provides the campus. Students in the program will earn an associate’s degree, and, if they’re interested, can be automatically enrolled at Kent State, Diacon said.

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CRAIN’S CLEVELAND BUSINESS

TAX LIENS

MANUFACTURING IS:

Innovation

The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorder’s Office. The IRS files a tax lien to protect the interests of the federal government. The lien is a public notice to creditors that the government has a claim against a company’s property.

Liens reported here are $10,000 and higher. Dates listed are the dates the documents were filed in the Recorder’s Office.

LIENS FILED  AmTrust North America Inc. 800 Superior Ave. E., 21rst Floor Date filed: June 20, 2018 Type: CIVP Amount: $578,280.00

EC Financial LLC 6155 Rockside Road, Suite 201, Independence Date filed: May 24, 2018 Type: Employer’s withholding Amount: $429,043.41 

 Savmor 116 Deli Inc. 3750 MLK Jr. Drive, Cleveland Date filed: July 2, 2018 Type: Employer’s withholding, corporate income Amount: $129,545.85  Legends Distribution 284 Karl St., Berea Date filed: June 6, 2018 Type: Employer’s withholding Amount: $63,478.64

Bettcher Industries expanded its business by embracing new ideas and potential customers For many years, Bettcher Industries has been a global research that a product company needs to do to keep up with the future of the industry,” O’Donnell says. It’s also sales leader in a niche market, manufacturing equipimportant to develop foresight, in order to understand ment for the food processing industry, principally the customer needs currently and in the future. meat processing industry. However, in recent years, Bettcher Industries is proof of how keeping an open the company realized it could only grow if it expanded mind to potential customer needs can pay dividends. outside this niche.

Several years ago, a salesperson received a call asking if As a result, Bettcher turned to experts for advice and one of Bettcher’s power knives used ideas — including the Business Innoin meat plants could have human vation Factory operated out of Brown applications. Thanks to its culture of University and Baldwin Wallace’s “You have to be innovation, Bettcher saw the spark Center for Innovation and Growth — out in the field of a new opportunity, and put its and created an internal team focused talking to engineers to work. The result is a on learning about (and galvanizing) spin-off company, Exsurco Medical, innovation. customers and which makes a tool for surgeons do“We knew that our growth seeing products in ing burn debridement, or removing couldn’t come from what we were necrotic tissue from burn survivors, doing. It had to come from someuse to understand as well as skin grafts. “In both thing new,” says Bettcher Industries what works.” cases, the tool has provided some president and CEO Don Esch. “And very unique and advantageous we had to allow people’s minds to — Mike O’Donnell, MAGNET outcomes,” Esch says. “That all receive an innovation message.” vice president of operations came out of a call from a potential For companies that sell prodcustomer back in 2010.” ucts, growth comes from building However, savvy companies might also a competitive advantage. Nurturing existing company sometimes recognize that they aren’t the best firms talent and encouraging innovation, like Bettcher did, is to take a product to market. In cases like this, the one way to achieve that. Ideation —“basically structured growth solution is partnerships. brainstorming,” says MAGNET president and CEO “Your new product might be going into a partner’s Ethan Karp, where a company might “bring diverse market, where there’s mutual benefit,” Karp says. “Or, people into a room and solicit their input on how a new potentially, your partner loves your idea so much you market might be found” — is another way to generate get to manufacture for them — you get the IP, but they potentially transformative ideas. take it to market. If it’s a new market and a new product, However, innovation doesn’t always have to be finding the right partner is probably a great idea.” complicated. When it comes to building relationships Looking for ways to drive manufacturing innovation? with customers, listening and keeping an open mind is That’s what we do. MAGNET’s mission is to help key, says MAGNET vice president of operations Mike manufacturers grow and compete—with the latest O’Donnell. “You have to be out in the field talking to innovations—in Northeast Ohio. Check out MAGNET’s customers,” he says. “You have to have field sales people Power Assessment for ways to make an immediate impact out seeing products in use to understand what works, and embrace new ideas. Learn more about MAGNET’s what doesn’t work.”

Power Assessment at www.manufacturingsuccess.org/ In addition to hands-on interactions, firms need power-assessment-innovation, or call Linda Barita at to keep on top of global economic trends and trends (216) 391-7766. within a customer’s business. “There’s a lot of market

This advertising-supported feature is produced by Crain Content StudioCleveland, the marketing storytelling arm of Crain’s Cleveland Business.

The Crain’s Cleveland Business newsroom is not involved in creating Crain Content Studio-Cleveland content.

P014_CL_20181008.indd 14

 Venture Renovations Inc. 7500 Wall St., Valley View Date filed: June 20, 2018 Type: Employer’s withholding Amount: $51,510.43  Paul F. Smith Jr. DDS Inc. (two liens over $10,000) 3461 Warrensville Center Road, Suite 306, Cleveland Date filed: June 20, June 6, 2018 Type: Failure to file complete return, employer’s withholding Amount: $50,560.15; $15,117.37  Sewar LLC 1828 S. Taylor Road, Cleveland Heights Date filed: June 6, 2018 Type: Employer’s withholding Amount: $41,316.26  SPA West Corp.

29109 Center Ridge Road, Westlake Date filed: July 2, 2018 Type: Employer’s withholding Amount: $35,676.96  Cirque du Kids LLC 8706 Garfield Road, Garfield Heights Date filed: July 2, 2018 Type: Annual tax return Amount: $34,234.59  Eames Warehouse 13760 Blazey Trail, Strongsville Date filed: June 20, 2018 Type: Employer’s withholding, unemployment Amount: $19,884.11

LIENS RELEASED Cleveland Granite and Marble 4121 Carnegie Ave., Cleveland Date filed: Oct. 16, 2014 Date released: June 6, 2018 Type: Employer’s withholding Amount: $70,636.85 

 Ohio Textile LLC 1719 E. 39th St. Date filed: March 28, 2013 Date released: April 26, 2018 Type: Annual tax return, unemployment Amount: $66,544.19  Applause International Model and Talent Development Inc. 30701 Lorain Road, Suite B, North Olmsted Date filed: Dec. 11, 2015 Date released: June 6, 2018 Type: Employer’s withholding, unemployment, failure to file complete return Amount: $64,334.69

 Expert System Applications Inc. 26401 Miles Road, Cleveland Date filed: Dec. 2, 2014 Date released: May 15, 2018 Type: Employer’s withholding Amount: $56,754.45  Medicare Transport Inc. 6100 Oak Tree Blvd., Suite 200, Independence Date filed: Feb. 7, 2014 Date released: April 26, 2018 Type: Employer’s withholding, unemployment Amount: $37,674.62  K Klass Masonry Inc. 15293 Sandalhaven Drive, Middleburg Heights Date filed: Sept. 20, 2011 Date released: June 6, 2018 Type: Employer’s withholding Amount: $26,845.88  Roudina Corp.

12200 St. Clair Ave., Cleveland Date filed: Oct. 14, 2008 Date released: June 6, 2018 Type: Employer’s withholding, unemployment Amount: $20,773.82  Kimmich’s Growing Trends Inc. 22218 Lorain Road, Fairview Park Date filed: June 9, 2008 Date released: May 8, 2018 Type: Employer’s withholding, unemployment Amount: $18,707.54  Roemer Nursery inc.

925 Euclid Ave., Suite F2020, Cleveland Date filed: Sept. 21, 2017 Date released: May 15, 2018 Type: Agriculture, unemployment Amount: $18,467.68  Mvarch inc.

3367 W. 105th St., Cleveland Date filed: July 21, 2008 Date released: June 6, 2018 Type: Employer’s withholding, unemployment Amount: $18,175.69  Diversified Enterprises Inc. 7023 Edgecliff Road, Parma Date filed: Sept. 23, 2014 Date released: May 15, 2018 Type: Employer’s withholding Amount: $17,978.80  Truly Carpet Inc. 6615 Pearl Road, Parma Heights Date filed: July 27, 2009 Date released: April 26, 2018 Type: Employer’s withholding Amount: $15,901.31  Solon Restaurant Repair Inc. 38240 Aurora Road, Solon Date filed: May 12, 2015 Date released: May 8, 2018 Type: Employer’s withholding, failure to file complete return, corporate income Amount: $15,388.65  Riggen Roofing Co. 9635 Idlewood Drive, Brooklyn Date filed: Sept. 22, 2015 Date released: July 2, 2018 Type: Employer’s withholding, unemployment, corporate income failure to file complete return Amount: $12,861.28  Kowit Real Estate LLC; Kowit & Company Real Estate Group 6009 Landerhaven Drive, Mayfield Heights Date filed: March 7, 2018 Date released: June 20, 2018 Type: Employer’s withholding Amount: $11,092.10

10/4/18 4:39 PM

CRAIN’S CLEVELAND BUSINESS

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PA G E 15

At the Table

At La Dolce Vita opera nights, a feast for the ears Food and service are prano Claire Connolly central to the dining expefrom Oklahoma and tenor rience, of course, but muBrian Skoog from Alasic is as much a part of an bama, who met at the evening at the table as Cleveland Institute of Mulighting, seating and decor. sic, occasionally appear.

Whether it’s rock, counOnce in a while, Tarantino diverges, such as the try, easy listening or “Rat past summer’s perforPack,” eateries of every Joe stripe throw music into the Crea mance by Latin trumpet mix to liven the tempo, king Humberto Ramirez. soothe or excite — to entertain.

On a recent September night, JonRestaurateur Terry Tarantino has a athan Cilia Faro, a tenor from Italy, different take on the sound he laces was joined by local soprano Katherthrough an evening at La Dolce Vita ine Ziegart. restaurant in Cleveland’s Little Italy.

The music interlaces the meal serAt 61, the chef-owner comes across vice. Tarantino learned early on that as a grizzled, old-school, Italian while fans dote on the performances tough guy who’s rarely seen without and enjoy the special four-course his signature pork-pie hat. menus his kitchen produces, they arYou’d figure him as a rocker — mu- en’t necessarily a perfect simultanesic he quickly admitted he loves ous experience. Bustling servers, (“Bruce Springsteen is my favorite clattering plates and murmured conrock guy, and The Who, The Beatles, versations easily interrupt the singLed Zeppelin … I love Sting. And I’ve ers’ artistry. cooked for Chuck Mangione, one of “So it all started with this singer, the thrills of my life.”) — but Latin Robert W. Becker, a baritone and jazz, Cuban sounds and Turkish pop teacher at Baldwin Wallace. He’s an are his personal passions. amazing talent and one of the most Still, Tarantino’s daily soundtrack educated people in Cleveland, a true might be the last thing you expect: artist. I decided to have him sing at opera. the restaurant and people loved him.

“When I was a kid, I played cello in “But after a while, they said they an orchestra, and then I fell in love couldn’t hear themselves talk. And with Luciano Pavarotti — but not so we were doing this on a Friday and much with opera,” he said.

Saturday night: (People) want some “But after I fell in love with Pa- entertainment, but also want to varotti, from there it blossomed into spend their night with the people all kinds of things. I play Sinatra, Jerry they’ve come with.

“So after reviewing everything, I Vale, Mario Lanza. But so many peosaid, ‘Hey, Robert, ple come in and say, instead of singing ‘I love what you’re “I play Sinatra, four songs in a set, I playing, but could Jerry Vale, Mario have an idea: Sing you play some opone song, break for era?’ People really Lanza. But so many do love it.” people come in and 10 minutes, sing anYou might call it a other song and say, ‘I love what gimmick — and in tobreak for 15 minutes … sing another … day’s hip-hop-in- you’re playing, but and you’ll capture fused world you could you play the room.’ might also view it as a “He looked at me unique marketing al- some opera?’ like I was crazy. But ternative — but the People really do what I noticed, he effusive Clevelander was getting irritated who warmly embrac- love it.” when he didn’t have es “the sweet life” — Restaurateur Terry the full room capsees it differently.

He has simply de- Tarantino tive. That’s when I started thinking how veloped, nurtured and continued to provide a loyal au- to redo the whole thing. And it worked wonderfully.” dience with a rare thing.

Tarantino also shifted perforOn the home page of his restaurant’s website, Tarantino sums it up mance nights to Mondays. They’re neatly: “Allow yourself to drift back to comparatively quiet nights when an age when time was life’s greatest business is slow and finding parking commodity. …” in congested Little Italy isn’t as much “You know, it’s something beauti- of a challenge for guests.

“I could build up a day when I wasn’t ful in crazy times,” he added.

He loves excerpts more than full bringing in much revenue,” he said.

Now when he emcees, Tarantino operas, he said.

“But I do love ‘Madame Butterfly,’ ” asks audience members to turn off their cell phones “and please keep he added.

He called “Nessun Dorma,” the ex- your conversations to a quiet whisquisite aria from Giacomo Puccini’s per, in respect for the performers and “Turandot,” his absolute favorite. others in the audience,” he said.

So at La Dolce Vita, where guests In today’s regrettably coarse world, are usually drawn by a menu of Ital- one has to wonder: Does the seaian pastas, a few pizzas and lots of soned restaurateur ever get customclassic entrees, the air resonates with ers who demand that he “turn off that old-school sounds. But about twice crap” and tell him to play “normal” each month, it’s filled with really Old music?

World sounds. Those evenings, Mon“Never. The only people, when I was downtown (at the short-lived La days, are live opera nights.

For years, Tarantino has filled the Strada restaurant on East Fourth place. A procession of local vocalists, Street) were the employees. They’d get interspersed with out-of-town talent, tired of it, and I’d say, ‘Yeah, well, linger for a few hours in his salon. we’re hearing it over and over, but the Soaring strains and delicately nu- customers are only here for an hour, anced melodies ring through the hour and a half. Anyway, we’d switch off for a while. But the customers room to a rapt audience.

Julie Gulenko, a soprano, is direc- asked us for some more opera.

“What I’ve learned,” Tarantino obtor of the opera nights. Along with her voice, guest talents such as so- served, “is 95% of the people who

P015_CL_20181008.indd 15

La Dolce Vita’s opera nights Where: 12112 Mayfield Road in Cleveland’s Little Italy.

When: Live performances typically are held from 7 to 9:30 p.m. on Mondays, once or twice a month.

Upcoming dates: Mondays, Oct. 15 and 29, Nov. 12 and 19, and Dec. 17; and Wednesday, Dec. 26. “And there’s a good chance we’ll be doing opera on Dec. 31, New Year’s Eve, because it’s a Monday,” owner Terry Tarantino said.

Cost: The $40 package includes music and dinner, or a $15 cover for the performance only.

Reservations: Recommended. Call 216-721-8155.

Online: clevelandladolcevita.com

Restaurateur Terry Tarantino presents live opera roughly twice a month at La Dolce Vita in Cleveland’s Little Italy. (Contributed photo)

come in have come in because the women wanted to. The guys are notorious for falling asleep. But now my sets are only 10 to 15 minutes long, and you can hold people’s attention for 10 or 15 minutes. ... And guys come up to me and say, ‘I LOVED this. And I REALLY didn’t want to come!’ ”

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10/4/18 3:59 PM

PA G E 16

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CRAIN’S CLEVELAND BUSINESS

Focus

BUSINESS OF COLLEGE SPORTS

AKRON TRIES TO TACKLE ITS SPORTS ‘DILEMMA’ The $61.6 million InfoCision Stadium, which opened at the University of Akron in 2009, has an annual debt service of $5 million. (AkronStock)

Cost of athletics is particularly confounding for university with budget woes

By KEVIN KLEPS kkleps@crain.com @KevinKleps

When Larry Williams was hired as the University of Akron’s director of athletics in August 2015, Scott Scarborough was the university’s president.

The Zips have had two changes at the top since — the second of which resulted in Dr. John Green, a 31-year employee, being named interim president in April.

“It’s not as stable as you’d otherwise want,” Williams said of the Zips’ leadership situation.

“But the good news is John Green is a very stable character. He’s been here forever and he knows where all the land mines are.”

The problem is, navigating those challenges — as the rocky tenures of Scarborough and his successor of two years, Matthew Wilson, showed — at Akron is difficult even by higher education standards.

The Zips’ declining enrollment (the total of 20,554 students this fall is down 7% from the previous year and marks a drop of almost 31% from 2011-12) and financial struggles (a $16 million deficit was projected for 2018-19) have led to a slew of budget and job cuts. One — the dumping of the baseball program in July 2015, a month before Williams was hired — produced such negative reactions that the sport was reinstated two years later, albeit with the caveat that any scholarships would be paid by donors.

Green, who had led the Buchtel College of Arts and Sciences since 2015, said a key part of the interim job is to get the university’s “finances in order,” thus giving his replacement “a good chance for success.”

And the Zips’ athletic department, with one of the largest budgets and the highest sports

P016_017_CL_20181008.indd 16

Akron’s football team has won at least seven games in two of the last three years. Prior to that stretch, the Zips hadn’t won more than five games since 2005. (Jeff Harwell)

count (19, once baseball and women’s lacrosse start play in 2019-20) in the Mid-American Conference, is a particularly confounding area for Green to study.

“It’s one of those dilemmas that all university presidents struggle with,” Green said. “One one hand, athletics are part of the college tradition at most universities in one form or another. ...

On the other hand, athletics are expensive — and in some parts, quite expensive.”

‘As frugal as possible’ Akron’s athletic department budget of $33.1 million in 2017-18 included operating expenses of $11,174,159 and a total payroll of $10,181,747.

The figures were a respective $1,230,159 and $173,747 above the original projections.

But the Zips’ athletic revenues — a theme that is all too common throughout NCAA Division I — account for only a quarter of the department’s costs. That leaves the university to pick up the tab for the rest, via student fees and other institutional support.

“We’re really trying to be as frugal as possible,” said Williams, a former offensive lineman who was a 10th-round pick by the Cleveland Browns in 1985 and started for teams best known by “The Drive” and “The Fumble.”

Green said the athletic department under Williams “has been run well. The question is can we afford to do things the way we’ve done them in the past?”

What that means, he’s not sure. But he’s examining everything.

“We compete in a lot of sports,” Green said.

“Are we going to be able to continue to do that, and even if we can, do we maybe offer them at a different level of competition than we have in the past? That’s all very controversial.”

That doesn’t mean Akron is in danger of leaving Division I in such marquee sports as football, basketball and soccer — Green cited the success of the latter’s men’s program as one in which it would be “hard to imagine a reduced level of competition.”

But, he added, the Zips will need to “make some decisions soon” if more drastic measures need to be taken.

Football, according to data submitted to the U.S. Department of Education for the 2016-17 school year, is easily Akron’s most expensive sport, at $7.25 million. The Zips’ total, however, ranked eighth in the 12-team MAC and was about $940,000 below the conference average for the sport.

SEE AKRON, PAGE 22

10/4/18 4:07 PM

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Akron athletics: By the numbers Football expenses The expenses for Mid-American Conference football teams in 2016-17, according to data submitted to the U.S. Department of Education: 1. Ohio $10,134,888 2. Toledo $10,046,711 3. Miami $9,346,412 4. Eastern Michigan $9,033,503 5. Western Michigan $8,667,334 6. Northern Illinois $8,035,152 7. Buffalo $7,796,405 8. Akron $7,253,770 9. Central Michigan $7,233,254 10. Ball State $7,044,512 11. Kent State $6,861,750 12. Bowling Green $6,537,321 Total: $97,991,012 Average: $8,165,918 Number of sports programs Akron: 19, once baseball and women’s lacrosse start play in 2019-20 MAC average: 16.3 Men’s teams Akron: 8 (including baseball) MAC average: 6.7 Women’s teams Akron: 11 (including lacrosse) MAC average: 9.6 Note: Akron’s totals include a pair of rifle (which have a combined 18 athletes in 2018-19) and golf programs (14 athletes).

Akron’s in- and out-of-state athletes Men’s sports: 129 in-state, 123 out-of-state In-state percentage: 51.2 Women’s sports: 98 in-state, 86 out-of-state In-state percentage: 53.3 All programs: 227 in-state, 209 out-of-state In-state percentage: 52.1

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10/4/18 4:08 PM

PA G E 18

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CRAIN’S CLEVELAND BUSINESS

BUSINESS OF COLLEGE SPORTS

Beer on tap at Ohio college football games

By DOUGLAS J. GUTH clbfreelancer@crain.com

Nationwide, beer is becoming as much a part of college football fandom as hot dogs, mascots and marching bands. In Ohio, beer and other alcoholic beverages are on tap at stadiums from Kent to Cincinnati, an enhancement that school officials instituted to meet fan expectations and improve attendance at home games.

Whether alcohol means more patrons at the gate is largely unproven, but there’s no doubt that more universities are bringing booze to their

fan bases. Kent State University started selling beer at its concession stands in 2009. Fans can also buy beer — or a cup of wine, in some cases — at college stadiums at Akron, Toledo, Bowling Green, Ohio, Ohio State, Miami and Cincinnati. According to national reports, 52 colleges are offering alcohol at either on-campus stadiums or various off-campus venues, compared to 10 years ago, when fewer than a dozen Division I schools sold suds at collegiate sporting events.

The general concourse at Kent State’s Dix Stadium provides beer, including MillerCoors products and a selection of craft beers. Red and

white wine is available at closed-off VIP spaces where donors receive discounted beer and complimentary food.

Colleges are pouring beer at their games to meet a call for additional revenue and an enhanced game-day experience, a prevalent point for a Mid-American Conference school such as Kent State that struggles to consistently put fans in seats.

“It’s a challenge for many programs to get people to come to games,” said deputy athletic director Casey Cegles. “We began selling beer for entertainment purposes. It’s an expectation for people like popcorn and nachos.”

Providing a fan amenity Modern football fans need more motivation than ever to attend games, considering they can knock back a cold one from their easy chair amid the comforting glow of a 50inch high-definition television, school officials said.

“Whether it’s college or pro, people want to watch games at home,” said George Van Horne, senior associate athletics director at the University of Akron. “We want fans to come and support the Zips, so beer became a fan amenity.”

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dium-Summa Field in 2012, Akron reviewed the football stadium alcohol policies of Kent State, Bowling Green and Cincinnati. Previously, alcohol at Akron’s stadium had only been available on the loge and club seat levels.

Today, 12 concession stands throughout the facility offer mass-produced and craft beers, with beer, wine and spirits for sale on the club level. Alcohol at home games gives Akron another revenue source to bolster both the general and athletic department budgets, Van Horne said.

The institution nets a portion of overall revenue based on a commission agreement with its vendor. Last season, the university made $70,186 from alcohol sales. It took home $34,605 in 2015. Sales for 2016 are unavailable, as Akron switched concession partners at year’s end.

While the dollars aren’t significant compared to larger programs — Ohio State made $1.35 million in beer profits over seven home games in 2017 — catering to attendees catalyzes a fan base surrounded by sports and entertainment options, Van Horne said.

“We talked to local pro sports organizations and asked them about best practices,” he said. “Go to a Browns game and everyone expects to have a Bud Light.”

The University of Toledo grossed $120,000 in beer and wine sales during its 2017 MAC championship football season.

Charging between $6.50 and $7 for individual servings, the $30,000 to $40,000 in net sales Toledo makes annually goes into the athletic department’s $27 million operating budget, said deputy athletic director David Nottke. The school also provides beer and wine at men’s and women’s basketball games, and accrued $21,000 in gross revenue during the 2016-17 season.

“We’re not looking to get rich selling beer and wine,” Nottke said. “We had fans asking us why we didn’t sell, and wanted to get out in front of that.”

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Programs in the 129-team Football Bowl Subdivision are offering alcohol to help boost attendance numbers that declined by 3.2% on a pergame basis in 2017, according to the NCAA. The decrease, from 43,612 to 42,203 fans per contest, marked the division’s biggest attendance drop in 34 years.

The 12-team Mid-American Conference finished last among the 10 FBS leagues in 2017, dropping from 16,391 to 15,394 per game. Akron had FBS’ second-largest per-game attendance jump at 9,232, thanks in part to a competitive on-field performance that saw the program advance to its second bowl game in three years.

However, Zips supporters have not been surveyed about how alcohol availability has influenced their game-day habits, said Van Horne, the school’s associate athletics director.

“There’s no good way to measure that,” he said. “I don’t think beer sales have had a great impact on our attendance.”

Last season, Kent State enjoyed a per-game increase of 2,287 fans over 2016, an uptick not necessarily attributable to alcohol, said deputy athletic director Cegles.

SEE BEER, PAGE 22

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Prosecutor: Bribe plot defrauded schools BLOOMBERG

U.S. college basketball went on trial in New York last Tuesday, Oct. 2, with a prosecutor telling jury members they’d see what corruption in the sport looks like.

In meetings in hotel rooms and parking lots, a former Adidas AG executive and two other men funneled cash to family members of prospects in exchange for a commitment to play for university programs sponsored by the maker of shoes, team jerseys and other athletic wear, Assistant U.S. Attorney Eli Mark told the jury at the start of the trial.

“It was a blatant and brazen violation of the most fundamental rule in college basketball — that you can’t pay to play,” Mark said.

James Gatto, the former Adidas executive, Merl Code, a consultant with ties to Adidas, and agent Christian Dawkins are among 10 people charged in a sweeping probe into illicit kickbacks in National Collegiate Athletic Association basketball that reached the highest levels of the sport. More trials are pending.

Gatto’s lawyer said in her opening statement that he broke NCAA rules but isn’t guilty of a crime. The three men have argued that they were trying to help schools recruit top talent with the knowledge of coaches.

“NCAA rules are not the laws of this country,” Casey Donnelly said.

Donnelly likened the NCAA and its rules to “a kids after-school soccer league” that takes in $1 billion a year.

She and the other defense lawyers said their clients were trying to help the players’ families meet their expenses, help sponsored schools win top recruits and help Adidas make connections with players who might someday become NBA stars.

Hoops are one of the two revenue-generating sports at most big colleges. The profits from football and basketball help fund other programs and support big-ticket expenses like new arenas and coaches’ contracts. But critics say they also spur sporting goods companies and their representatives to bribe prospects to play for the programs that the companies sponsor.

One prominent coach — the University of Louisville’s Rick Pitino — lost his job last year amid allegations that Adidas paid the family of a recruit. Pitino isn’t accused of wrongdoing.

Louisville’s basketball program turned an NCAA-best $27.7 million in profit off $45.6 million in revenue in 2016. Kansas’ hoops team made $7.1 million profit on $18.3 million in revenue.

‘Dirty business’ “College basketball is a dirty, dirty business,” said David Ridpath, a sports administration professor at Ohio University and former president of the Drake Group, a coalition aimed at preserving academics in the world of commercialized college athletics, in an interview. He’s not involved in the case.

“The more ugliness that gets exposed, the more impetus there is for change,” Ridpath said.

While the outcome of the trials won’t be important to many fans, there’s great anticipation for what might be revealed.

Potential jurors were told of 12 Division I programs that might be men-

P019_CL_20181008.indd 19

tioned, along with a list of wellknown college coaches, including Arizona Wildcats coach Sean Miller, University of Kansas’ Bill Self and University of Miami’s Jim Larranaga.

Athletes, like Duke’s Zion Williamson and North Carolina’s Nassir Little, may also be mentioned. None of them are accused of wrongdoing.

A key issue in the case is whether schools are victims, as prosecutors claim. The government says schools such as Kansas, Miami and Louisville were the victims of fraud because they were exposed to NCAA rules violations that caused financial and reputational harm. But the defendants dispute that claim.

“It was a blatant and brazen violation of the most fundamental rule in college basketball — that you can’t pay to play.”

— Assistant U.S. Attorney Eli Mark

In the case of Louisville’s successful efforts to recruit Brian “Tugs” Bowen, a small forward from Saginaw, Mich., consultant Merl Code “stepped up and did what Pitino, the face of Louisville and the big dog

there, wanted,” his lawyer, Mark Moore, told the jury. He urged jurors to “think about whether he was doing this to defraud a university or whether he was doing it to help a university and its basketball program.”

Mark, in the government’s opening statement, told jurors that the three defendants planned to pay Bowen’s father about $100,000, with the first installment of about $20,000 handed over in a cash-stuffed envelope in a parking lot in New Jersey.

Prosecutors will present testimony from Brian Bowen Sr., who was granted immunity, Mark said. Jurors will hear excerpts from dozens of phone calls tapped by the FBI, he said. The

trial is expected to take as long as a month.

Dawkins’ lawyer, Steven Haney, said his client intended to help players with the goal of one day becoming a prominent sports agent.

The arrests date to September 2017, when prosecutors announced the results of a two-year probe that detailed how shoe executives, middlemen and assistant coaches helped coordinate illicit payments to recruits and their families. The evidence emboldened those who criticize the NCAA for its refusal to compensate athletes beyond scholarships, and forced the governing body to admit that its system was broken.

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Q&A: Jon Steinbrecher

Commissioner, Mid-American Conference In this, his 10th year in charge of the Cleveland-based Mid-American Conference, Jon Steinbrecher says the 12-member league is on “very solid financial footing.”

That’s thanks in part to a 13-year rights agreement the MAC struck with ESPN in 2014. The deal — which added provisions to the three years that remained on the current contract and added another 10 years — reportedly resulted in an annual raise of $9 million (from $1 million to $10 million) during the final decade of the agreement. The conference has made a name for itself via midweek football games on ESPN’s family of networks, the collection of standout NFL players it’s helped to produce and some memorable March Madness runs in basketball. The MAC has also increased its guaranteed and secondary college football bowl game agreements to five and three, respectively, during Steinbrecher’s tenure. As a result, MAC teams have appeared in a combined 40 bowl games the last seven years. That, Steinbrecher is more than happy to discuss. Just don’t mention that the conference’s football teams are part of the so-called “Group of Five” — the Football Bowl Subdivision leagues that often play second fiddle to the “Power Five” conferences. — Kevin Kleps You’ve been pretty outspoken about the whole labeling thing — Group of Five, Power Five — in college football. Do you think it’s silly?

People too easily devalue what we’re doing. “Oh, it’s just them.” No. We can play. You look across all of

our sports, our top teams, inevitably, year in and year out, are among the best in the country. Let’s quit being lazy and looking at labels. You gotta continue to reinforce that and continue to bang the drum on it.

You got a lot of attention when

“If you’re not getting the opportunity to fly the flag, it doesn’t do a lot. It’s good that we’re winning some games. We need to continue doing so. And let’s have some fun. It’s sports.”

Mid-American Conference commissioner Jon Steinbrecher dressed as a pirate for a video that was part of the league’s Fly the Flag promotion. (Contributed photo)

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you MAC Did hop Yes. doin wer “Let con all r non oug fans it’s b the as t not the that nee have

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forward already to December and January this season, and seeing how we match up and compete.

Those games are important. It’s like winning basketball games in the NCAA tournament. You have a good March and it does so much to elevate the perception of your league.

It’s been four years since you struck the deal with ESPN. Looking back at everything that’s transpired in the media business since, with cord cutting and everything else, are you feeling pretty good about that deal now?

Absolutely. Absolutely. I wish I could say we anticipated all the changes that were coming down the pipe. We didn’t know what all of them were, but we knew stuff was happening. We knew some of the cord cutting was likely to happen.

We didn’t know how that would affect any of the various carriers.

Yeah, I’m pleased we struck when we did. ESPN was a great partner in that, and it’s positioned us well for roughly a decade (longer).

you dressed as a pirate for the MAC’s Fly the Flag promotion.

Did that achieve what you were hoping?

Yes. This is something I’ve been doing for four or five years, but we were doing it quietly. I just thought, “Let’s have some fun with it. Let’s continue to do things that we can all rally around.” When we’re in nonconference competition, we ought to be each other’s biggest fans. Let’s all celebrate that. I think it’s been fairly well-received, but at the end of the day, it’s only as good as the product on the field. If you’re not getting the opportunity to fly the flag, it doesn’t do a lot. It’s good that we’re winning some games. We need to continue doing so. And let’s have some fun. It’s sports.

As you mentioned, that message only goes so far. How important are nonconference football games to the MAC? You are what your record says you are, and you are what the scoreboard says you are. Everything else is just chatter. This is a very bottom-line enterprise. Let’s go out and compete, and let’s let the chips fall where they may. And if we win the games, then we deserve the respect that we think we do. But you’ve gotta earn it.

Touching on that, the conference has done a good job of securing additional bowl agreements. But the MAC has only won one bowl game the last two years. Does that frustrate you?

Sure. I, and I would imagine our football coaches, ADs and fans, would all say we’re disappointed in how we performed the last couple years in bowl games. I wish there was a switch I could flip that could change that, because we’ve had really good success in September, October in nonconference games.

It’s not necessarily translated in the bowl season. But each year it’s a new season and we’re looking

P020_021_CL_20181008.indd 21

The midweek games have really helped the conference’s visibility. There are pluses and minuses that come with those.

Are they here to stay?

I’m getting some stats drawn up right now, but I think if we would go back and look across all of FBS, the number of teams that play multiple non-Saturday games, people would be surprised. This is not a new thing. Obviously, we’ve been doing it for, I think, 20 years now. It’s given us the platform to elevate us from a regional conference to a national conference. Now, the platform is only as good as the product you put on the field, and fortunately we’ve had a really good product. It’s given us a chance to shine a very bright light on some really good teams and some really good student-athletes. Those are critical things.

The new ESPN deal obviously helped the conference’s revenues. Is it more difficult to bump those up in other areas now than it used to be because the college sports landscape has changed so much?

In a conference office, you only have a couple of big revenue streams. It’s our College Football Playoff revenues, bowl revenues, and those get contracted somewhere between once every 12 years and once every six years.

There’s a pretty long life on that.

There’s your TV deal, which in our case ran about 13 years. We redid the last three years of the deal, and then another 10. Those are the big things, so when they get set, you kind of laid out the largest portion. Then for us, it’s can you grow attendance and things at championships, bringing in NCAA tournament events — really, that’s not insignificant revenue in the year that you’re able to get that.

We really brought in a bigger chunk than we anticipated when we hosted wrestling (the NCAA Division I championships that were held at Quicken Loans Arena last March).

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Wilson, during a January 2018 interview with Cleveland.com, said football was “bleeding” financially.

“It was disappointing to read that in print and in talking to Matt after that, he described the conversation as much broader than that,” Williams said. “The reality is football isn’t bleeding. Football pays for itself with unique revenues that wouldn’t be there if we weren’t playing football.

There are guarantee games, TV money — those are unique revenues that wouldn’t be available if we weren’t playing football. It’s a misnomer.”

Jon Steinbrecher, the MAC’s commissioner since 2009, added that “football is the one sport that either pays for itself or it comes as close to paying for itself as any of our sports.

And it helps set the table for everything else we do. It provides opportunities across our platforms.”

Looking for ‘a grand slam’ One of the biggest anchors on the athletic department’s budget is the $61.6 million InfoCision Stadium, which has an annual debt service of VOL. 39, NO. 16

VOL. 39, NO. 16

Sponsored Content

April 16-22, 2018

Acquisition helps keep Ramco on growth track

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completion by undergraduate students from the Buckeye State.

A scan of the rosters of the Zips’ 17 varsity sports in 2018-19, with baseball and women’s lacrosse still a year away, showed that 52% of Akron’s athletes are from Ohio.

“There are so many Division I-caliber players in Ohio who, for one reason or another, fall through the cracks,” Williams said. “We’re a regional institution. The vast majority of our students are from Ohio. It stands to reason that our sports teams should have that as an element of who we are.”

The former Browns guard is trying to pave the way as his department looks “under every rock for every opportunity we can.”

His boss, Green, who has made it clear that he won’t be a candidate for the president’s job on a permanent basis, said an enlightening aspect of his new position is getting to attend the MAC presidents meetings.

“The most interesting conversations happen during the coffee breaks,” Green said. “It turns out we all have very similar problems. There are a lot of institutions that, all things being equal, might desire a new arena. They just can’t now because of financial pressures.”

to football in 2017. The rollout came with minimal advertising, as the school preferred an emphasis on its athletes rather than alcohol, said executive director of intercollegiate athletics Ron Strollo.

Security problems due to beer sales have not be an issue at YSU or other local schools, officials said. If anything, offering alcohol at home games can curtail binge drinking during pre-kickoff tailgates.

“People don’t have to chug the last one or two beers before they start

walking in — they can just buy one here,” Strollo said.

Akron and additional participating institutions require wristbands for alcohol purchases and allow only two beers per transaction. Barring something unforeseen, Van Horne expects beer sales to continue as a gridiron promotion for many seasons to come.

“We’d like people to enjoy themselves and support their team responsibly,” Van Horne said. “The key driver here is making sure we have something to provide to our fans.”

April 16-22, 2018

Sponsored Content

Acquisition helps keep Ramco on growth track

VOL. 39, NO. 32

$5 million. About 94% of that is allocated to athletics.

“The stadium is already built,” Green said. “We can’t abolish half of it. Maybe we aren’t utilizing it sufficiently. But from my point of view, those are fixed costs, and we have to do the best we can with it.”

The university’s financial problems put a halt to plans to renovate James A. Rhodes Arena, which soon will ring in its 36th basketball season.

The arena recently got a new scoreboard and sound system, at a cost of $1.6 million. Williams said donors paid to renovate the basketball offices, and soon will cover the costs of work on the weight room that is used by the hoops and volleyball teams.

“I tell our coaches, we’re hitting singles (via donor generosity), and pretty soon, we’re going to get a power hitter to hit a grand slam,” Williams said. “We’re making good progress.”

The athletic department is continuing an initiative that was started

by Wilson — focusing on the recruitment of in-state athletes.

The measure, while far from a cure-all, could produce a seven-figure savings for the university, via an Ohio Department of Education subsidy for every Ohio resident who graduates, plus funding for course

gan to focus more on engineering

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VOL. 39, NO. 16 April 16-22, 2018 Sponsored Content After building and moving into a ers most often compete primarily on 185,000-square-foot headquarters and price and the cheapest part wins.

The company has found OEM more on engineering gan toitsfocus main plant a little over two years ago,

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Glenn College ofearlier Publicthis Affairs. growing domestic If transporthe state’s automotive compaIt month. must be working, because co’s infaster theirthan own The acquisition brings things that it began focusing onCopa more engiTool tation Ramco is not at allows least Asked whether Ramco or any sinproduction growth rates equipment can only do manufacturers, nies as a whole can fare that well, it some other companies are also find-unique, design processes.

That the might be more important than just than neered products a simple nut.in Growth Ramco’s automotive and are jobeither growth been steady amongcompany Northeast supplicompany’s recent in aube a good thing for Ohio, soauto in two ways: They on ahas would ing growth inmarket, automotive, the industo Ohio offer fastening systems sales, too, such as increased CopamanuTool is agle significant pickup business, by far itsgrowth largest end transportation equipment ers.

Some report they are also other tomotive is annual due to Jeff a rising or has still has a huge automotive small number ofamong hot products or a which try as atide, whole onothers acan downthat be integrated into facturing capacity. While forRamco Ramco.traIts $14 million in is fueling it all, Melick, Ramco’s di-been manufacturers, employwell. just to a well-run boat, Hill hadtrend, a ready according to the Ohio number products wherepresently a industry, ward said Edward “Ned” Hill,canlarger parts, which make the entireofauditionally has focused sales on thewill female be added Ramco’s an- and rector of sales marketing, said.doing ing 125,000 OMA Association.

Adler, president of Cuyahoga “It’smillion. the boat.”

Manufacturers’ few are picking up over market share. Ohioans,” a well-known OhioBill economist and tomotive manufacturing process end of fasteners — nuts and related of answer: nual revenues about $100 “This year, we’re up about 15%,” Ramco Specialties’ 185,000-square-foot headquarters spokesman Augsburger Heights-based Products, Overall, domestic auto production “Autosaid. supply remains a huge partand main plant has thatPlus, the overall tide is Ryan bouncprofessor public administration faster andStripmatic more Seeing efficient. they threaded assemblies Copa’s — Copa has 40 employees bring Ramco’s Melick said, adding that theofcompaplenty warehouse room, for Crain’s) For… itsthey part,of Ramco expects itstoo. re-(Dan Shingler also sells heavily thearound automohas been in apeople, slump, Hill said.

He and notof Ohio’s enormous manufacturing dead to low either and city regional planning atintoing do not depend wholly on price high-volume screw machines headcountthat to about 175 ny has been experiencing a similar growth to continue and isState worktive industry, supplying a range data from Federal Reserve data has shown increashave a goodof boatcent or have attached a sector. the Ohio State University’s John gain sales, Melick said. can produce bolts and othersaid. small ed thatgrowth Melick ratethe since about 2008, when ing hard to earn its place supplying parts.

He, too, said Bank of Louisthat shows thaton U.S. auto- engiing overall investment among all decent boat towhile a good motor.” growing faster than domestic If transporthe state’s automotive compaGlenn College ofsmall, Public tubular Affairs.

It must be working, because precision parts Ramco does curcur The not acquisition brings things it St. began focusing more parts for up-and-coming vehicles, business is any good as of late. makersneered went from about tation equipment Ramco is not unique, at least nies as a whole can fare that well, it production growth rates can only do manufacturers, Asked whether Ramco or sinsome other companies are also findrently make, Melick said. might be more important than just making products than a simple nut.

Melick said.

Copa’s and on has “Stripmatic is at 15% over ourindus350,000 automobiles month be-pickup and are job either growth been steady among Northeast Ohiosoauto supplibe a good thing for Ohio, in two ways: presence They a would company’s recent growth in auing growth inleast automotive, the presAnd it never hurts tosales, havetoo, a pres such as increased manumanu Copa Tool is per agle significant added connections and around first-quarter and last year’s tween 2013 and tra2016 totomotive now making transportation equipment ers.been Some reportsmall they are also in still has a huge automotive number ofamong hot products or a which is to a rising or has try as tide, aforecast whole onothers a downence in the metropolitan Detroit facturing capacity.

While Ramco tra for Ramco.

Its $14 million in due annual Detroitlarger should only of help, since where it presently sales,” Adler “The short-term abouton 250,000 units month. manufacturers, employdoing well. according to the Ohio number products a industry, just atowell-run Hill hadtrend, a said. ready ward said Edward “Ned” Hill, area, where Copa is based, alongside ditionally has focused thewill female sales be per added Ramco’sboat, anputs few Ramco toshare.Ohioans,” backlog through June looks prettypresident other words, company isthe boat.” over 125,000 OMA Association.

Billeconomist Adler, of Cuyahoga Manufacturers’ are physically pickinging upcloser market “It’smillion. a well-known Ohio and domestic automakers end and ofmany of —In fasteners nuts andrevenues related ifofaanswer: nual about $100 many Seeing of itsProducts, big customers, hetide added. solid as well.” growing, they40 must be doing somespokesman Augsburger Heights-based Stripmatic “Autosaid. supply remains a huge part that the overall isRyan bouncOverall, domestic auto production professor of public administration their suppliers that arethreaded all potential assemblies — Copa has Copa’s employees bring Ramco’s “Ouring product development who said hisregional products most thingmachines right.

For … its engipart, either Ramco expects itsenormous realso sells heavily at into the automoof Ohio’s manufacturing they around dead low has been in apeople, slump,Adler, Hilland said.

He notcity and planning Ramco customers, he noted. high-volume screw thatto about headcount 175 neers have area very excited to able to theirState waytive into pickups, supplying a supplier is from a typically growth to continue and isState work-data has shown increasindustry, range ofboatcent a good orbe have attached a sector. ed that data the Federal Reserve thefind Ohio University’s John Ramco hopes to bring bear itsbolts “How cantoproduce andMelick other small performs said. offer He, domestically SUVs and heavy commercial function of not which itofisSt.things suping hard to earn its place tubular too,boat saidto amanufactured ing supplying investment among all transpordecent good motor.”

Bank Louis that shows that U.S. autoGlenn College ofsmall, Publictrucks, Affairs. parts. chief strength to Copa’sprecision existing cuscus parts Ramco does curcurvehicles The acquisition brings engineered assemblies and compothinks new taxabout laws and a reduction plying and how those important vehicles went sell,” for up-and-coming vehicles, business is good as of late. equipment manufacturers, Ramco is notparts unique, at least tation makers making Asked whether Ramco or any sintomer base, Melickrently said.make, That Melick said. might be more thanfrom just nents quickly toour our Tier 1 automoof regulations are having a big posi-in Hill to said intoo, email corresponMelick said.suppliCopa’s presence “Stripmatic is at leastamong 15% over and job and growth has been steady Northeast Ohio auto 350,000 automobiles per beglemonth company’s recent growth austrength is engineering, And he said.

AfAf hurts presit never have a an pres sales, such as increased manutive Melickadded said. connections tive impact sales. dence.facturing “An Detroit auto supplier that is 2016 and around forecast and year’s transportation equipment ers.last Some others report they are also inamong tween 2013 and totomotive now on making is duefirst-quarter to a rising tide, or customers,” ter the Great Recession, Ramco bebe metropolitan ence in the capacity.

While Ramco traDetroit should only help, since it presently employsales,” Adler said.

“The short-term manufacturers, doing well. about 250,000 units per month. just a well-run boat, Hill had a ready area, where Copa is based, alongside ditionally has focused on the female puts Ramco physically to prettypresident ing closer over 125,000 Ohioans,” OMA Bill Adler, of Cuyahoga other company “It’sisthe backlog boat.” through June looks domestic automakers end and of many of —Innuts fasteners andwords, relatedif aanswer: Reprinted with permission from the Crain’s Cleveland Business. ©be 2018 CrainsomeCommunications Inc. All Rights reserved. many of itsProducts, big customers, he added. solidauto as well.” spokesman Ryan Augsburger said.

Heights-based Stripmatic growing, doing Overall, domestic production their suppliers that arethreaded all potential assemblies — they Copamust has Visit Further duplication without permission www.crainscleveland.com. #CC117 “Ourthe product development Adler, whoHe said his products For itsengipart, Ramco expects its realso sellsmost heavily into automothing right.is prohibited.

Hill said. notRamco customers, he noted. high-volume screw machines that has been in a slump, neers areavery excited to begrowth able toto continue and is work findReserve their waytive into industry, pickups, supplying workrange of cent a supplier is from a typically ed that data the Federal Ramco hopes to bring bear its bolts“How cantoproduce and other small performs offer He, domestically SUVs and commercial ing hard to earn its place supplying small, trucks, tubular parts. too, said manufactured function of which vehicles supBankitofisSt. Louis shows that heavy U.S. autochief strength to Copa’sprecision existing cuscus parts Ramco does not curand compothinksmaking new taxabout laws and a reduction for up-and-coming vehicles, business is goodengineered as of late. assembliesparts plying sell,” from makers went tomer base, Melick rently said.make, ThatMelick said.and how those vehicles nents to our our Tier 1 automoof regulations arebehaving“Stripmatic a big posi- is at Melick said. Copa’s presence and leastquickly 15% over Hill to said in aan email350,000 corresponautomobiles per month strength is engineering, he said.

AfAf hurts And it never have prestive customers,” Melickadded said. connections in and around tive impact sales. first-quarter forecast and last year’s dence. “An Detroit auto supplier is 2016 tween that 2013 and to nowon making ter the Great Recession, Ramco bebe metropolitan ence in the sales,” Adler said. “The short-term Detroit should only help, since it area, where Copa is based, alongside about 250,000 units per month.

In other words, if a company is backlog through June looks pretty puts Ramco physically closer to domestic automakers and many of Reprinted with permission from the Crain’s Cleveland Business. © 2018 Crain Communications Inc. All Rights reserved. many of its big customers, he added. their suppliers that are all potential growing, they must be doing some- solid as well.”

Further duplication without permission is prohibited. Visit www.crainscleveland.com. #CC117 “Our product development engiAdler, who said his products most thing right.

Ramco customers, he noted. neers are very excited to be able to typically find their way into pickups, “How a supplier performs is a Ramco hopes to bring to bear its chief strength to Copa’s existing cus- function of which vehicles it is sup- SUVs and heavy commercial trucks, offer domestically manufactured tomer base, Melick said. That plying and how those vehicles sell,” thinks new tax laws and a reduction engineered assemblies and compoHill said in an email correspon- of regulations are having a big posi- nents quickly to our Tier 1 automoAf strength is engineering, he said. Aftive customers,” Melick said. ter the Great Recession, Ramco be- dence. “An auto supplier that is tive impact on sales.

Acquisition helps keep Ramco on growth track

PROMOTE. BEER Why not?

CONTINUED FROM PAGE 18

Reprinted with permission from the Crain’s Cleveland Business. © 2018 Crain Communications Inc. All Rights reserved.

Further duplication without permission is prohibited. Visit www.crainscleveland.com. #CC117

“Attendance fluctuates based on weather and if the team is winning,” he said. “We also play a couple of games during the week, so that’s going to have an impact. But (beer sales) are now an ingrained experience in coming to a game.”

Youngstown State University first offered beer at men’s basketball games, bringing the alcoholic drink

Reprinted with permission from the Crain’s Cleveland Business. © 2018 Crain Communications Inc. All Rights reserved.

Further duplication without permission is prohibited. Visit www.crainscleveland.com. #CC142

Laura Picariello, Reprints Sales Manager Phone: (732) 723-0569 • Fax (888) 299-2205 Email: lpicariello@crain.com

TAX REFORM

WHAT’S NEXT? The IRS has released significant guidance to assist taxpayers with complying with changes from the Tax Cuts and Jobs Act. We will discuss these developments and present an in-depth review of important changes that will likely impact your 2018 personal and business tax returns.

+ Cleveland 10/18

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Business Advisors and Certified Public Accountants

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For questions, call Diane Gallagher at 216.344.5240

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10/5/18 PMAM 4/10/18 3:05 11:11

CRAIN’S CLEVELAND BUSINESS

|

O C T O B E R 8 - 14 , 2 018

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PA G E 2 3

THE LIST

Largest Accounting Firms Ranked by Number of Local CPAs

LOCAL CPAS

THE LIST

THIS YEAR COMPANY

8/31/ 2018

8/31/ 2017

331

305

8.5%

1,330

261,559 NA

390

203

356

381

Monte Repasky, Cleveland office managing partner; Whitt Butler, Akron office managing partner

160

-0.6%

393

236,000 NA

170

109

60

54

Mark Ross, Cleveland office managing partner

523 WORLDWIDE NA EMPLOYEES; 2017 REVENUE

124

Largest Accounting Firms Ernst & Young LLP, Cleveland

LOCAL PERSONNEL ENGAGED IN FULL-TIME LOCAL WORLDWIDE EMPLOYEES; EMPLOYEES % 2017 REVENUE CHANGE 8/31/2018

1 (216) 861-5000/ey.com Ranked by Number of Local CPAs 159 LLP, Cleveland 2 PwC (216) 875-3000/pwc.com

LOCAL CPAS

3

Cohen & Co., Cleveland (216) 579-1040/cohencpa.com

4 1 5

Deloitte LLP and its subsidiaries, Cleveland (216) 589-1300/deloitte.com Ernst & Young LLP, Cleveland (216) 861-5000/ey.com BDO, Solon (440) 248-8787/bdo.com

6 2

KPMGLLP, LLP,Cleveland Cleveland PwC (216) 875-3000/pwc.com 696-9100/us.kpmg.com (216)

95 159

95 160

0.0% -0.6%

180 393

7 3

RSM US&LLP, Cohen Co., Cleveland Cleveland (216) 579-1040/cohencpa.com 523-1900/rsmus.com (216)

82 155

86 155

-4.7% 0.0%

8 4

Maloney LLP + Novotny ClevelandCleveland Deloitte and its LLC, subsidiaries, (216) 589-1300/deloitte.com 363-0100/maloneynovotny.com (216)

79 105

75 105

9 5

Meaden & Moore, Cleveland BDO, Solon (216) 248-8787/bdo.com 241-3272/meadenmoore.com (440)

72 98

10 6

SkodaLLP, Minotti, Mayfield Village KPMG Cleveland (440) 696-9100/us.kpmg.com 449-6800/skodaminotti.com (216)

11 7

155

155

0.0%

8/31/ 2018

8/31/ 2017

336 FULL-TIME LOCAL EMPLOYEES % CHANGE 8/31/2018 0.0%

437

331

305

8.5%

1,330

98

93

5.4%

233

AUDITACCOUNTING TAX

CONSULTING OTHER

TOP LOCAL EXECUTIVE

LOCAL PERSONNEL ENGAGED IN 96

16

100

Randall S. Myeroff, president, CEO

AUDITACCOUNTING TAX 166

81

CONSULTING OTHER 170

20

390

203

356

381

70

73

30

32

197,000 236,000 NA NA

50 170

20 109

87 60

23 54

JamesRoss, Mylen, managing partner Mark Cleveland office managing partner

150 336

43,000 523 NA NA

54 124

24 96

44 16

35 100

Dave Andrews, Ohiopresident, market CEO Randall S. Myeroff, managing partner

5.3% 0.0%

136 437

150 286,000 NA NA

76 166

32 81

12 170

16 20

Matthew J. Maloney, managing Paul Wellener, Northeast Ohio shareholder managing principal

77 93

-6.5% 5.4%

142 233

240 67,000 NA NA

58 70

40 73

20 30

24 32

James P. Robert M.Carulas, Littman,CEO Ohio managing partner

70 95

69 95

1.4% 0.0%

244 180

295 197,000 NA NA

66 50

37 20

41 87

100 23

GregoryMylen, J. Skoda, chairman James managing partner

CliftonLarsonAllen LLP, Canton RSM US LLP, Cleveland (330) 523-1900/rsmus.com 497-2000/CLAconnect.com (216)

69 82

55 86

25.5% -4.7%

88 150

4,725 43,000 NA NA

38 54

33 24

8 44

1 35

Steven O. Pittman, Dave Andrews, Ohiomanaging market principal, Canton managing partnerand Akron offices

12 8

Bober, Markey, Fedorovich & Co., Akron Maloney + Novotny LLC, Cleveland (330) 363-0100/maloneynovotny.com 762-9785/bmfcpa.com (216)

57 79

56 75

1.8% 5.3%

98 136

98 150 NA NA

47 76

34 32

7 12

10 16

Richard C.J.Fedorovich, CEO, Matthew Maloney, managing managing partner shareholder

13 9

Grant Thornton Cleveland Meaden & Moore,LLP, Cleveland (216) 241-3272/meadenmoore.com 771-1400/grantthornton.com (216)

54 72

54 77

0.0% -6.5%

103 142

8,610 240 NA NA

29 58

31 40

30 20

13 24

Thomas Freeman, office James P.P. Carulas, CEO managing partner

14 10

Rea & Associates Inc., Cleveland Skoda Minotti, Mayfield Village (216) 449-6800/skodaminotti.com 573-2330/www.reacpa.com (440)

53 (1) 70

13 69

307.7% 1.4% (1)

87 244

264 295 NA NA

39 66

30 37

11 41

23 100

Rick Lash, president, Gregory J. regional Skoda, chairman Northeast Ohio

15 11

Pease & AssociatesLLP, LLC,Canton Cleveland CliftonLarsonAllen (216) 497-2000/CLAconnect.com 348-9600/peasecpa.com (330)

48 69

34 55

41.2% 25.5%

84 88

84 4,725 NA NA

24 38

45 33

4 8

11 1

Joseph V. Jr.,managing managing Steven O. Pease Pittman, partner Canton and Akron offices principal,

12

Bober, Markey, Fedorovich & Co., Akron (330) 762-9785/bmfcpa.com

57

56

1.8%

98

98 NA

47

34

7

10

Richard C. Fedorovich, CEO, managing partner

13

Grant Thornton LLP, Cleveland (216) 771-1400/grantthornton.com

54

14

Rea & Associates Inc., Cleveland (216) 573-2330/www.reacpa.com

53 (1)

13

307.7% (1)

87

264

39

30

11

23

Rick Lash, regional president,

15

Pease & Associates LLC, Cleveland (216) 348-9600/peasecpa.com

48

34

41.2%

84

84 NA

24

45

4

11

Joseph V. Pease Jr., managing partner

The Siegfried Group LLP, Cleveland (216) 912-1342/siegfriedgroup.com

47

39

20.5%

51

800 NA

0

0

47

0

Brian Seidner, managing director, Lake Erie Markets-Cleveland, Columbus, Pittsburgh, Toledo

17

HW&Co., Beachwood (216) 831-1200/hwco.com

42

42

0.0%

72

95 NA

26

19

20

7

John P. Fleischer, president, CEO

18

Barnes Wendling CPAs Inc., Cleveland (216) 566-9000/barneswendling.com

38

38

0.0%

70

70 NA

24

27

8

11

Jeffrey D. Neuman, president, director

19

CBIZ Inc., Independence (216) 447-9000/cbiz.com

37

43

-14.0%

251

4,636 NA

10

25

48

168

Jerome P. Grisko Jr., president, CEO

20

Apple Growth Partners, Akron (330) 867-7350/applegrowth.com

37

40

-7.5%

99

99 NA

18

50

9

22

Charles Mullen, chairman

21

Sikich LLP, Akron (330) 864-6661/sikich.com

36

31

16.1%

82

668 NA

27

18

26

11

David A. Brockman, partner-incharge, Akron

22

Corrigan Krause, Westlake (440) 471-0800/corrigankrause.com

34

33

3.0%

51

59 NA

19

20

6

20

Thomas L. Harrison, managing director

23

Ciuni & Panichi Inc., Beachwood (216) 831-7171/cp-advisors.com

32

30

6.7%

59

59 NA

33

13

8

5

Brian D. Marita, president

24

Plante Moran PLLC, Cleveland (216) 523-1010/plantemoran.com

29

29

0.0%

63

2,495 NA

32

16

10

5

Daniel P. Hursh, office managing partner

25

Four-Fifteen Group, Canton (330) 492-0094/415group.com

26

26

0.0%

63

63 NA

17

27

13

6

Frank J. Monaco, managing partner

26

Novogradac & Co., LLP, Cleveland (216) 298-9000/novoco.com

25

23

8.7%

49

700 NA

42

42

42

7

Renee Beaver, partner

27

Hobe & Lucas CPAs Inc., Independence (216) 524-8900/hobe.com

24

25

-4.0%

35

35 NA

20

9

5

1

James P. Gero, chairman; William F. Wildenheim, president, CFO

28

Zinner & Co. LLP, Beachwood (216) 831-0733/zinnerco.com

23

23

0.0%

30

30 NA

15

11

3

1

Robin L. Baum, managing partner

29

Crowe LLP, Cleveland (216) 623-7500/crowe.com

18

16

12.5%

36

4,080 NA

14

2

17

3

Greg McClure, office managing partner

30

D'Amore Tatman Group LLC, Beachwood (216) 378-1550/dtgroup.net

11

11

0.0%

21

21 NA

17

17

7

7

NA

THIS YEAR COMPANY

16

105

105

286,000 NA 261,559 NA 67,000 NA

TOP LOCAL EXECUTIVE

Paul Wellener, Northeast Ohio managing principal Monte Repasky, Cleveland office managing partner RobertButler, M. Littman, managing Whitt AkronOhio office partner partner managing

54 0.0% 103 8,610 29 31 30 13 Thomas P. Freeman, office NATIONAL FIRM EXPERTISE, BOUTIQUE FIRM ATTENTION NA managing partner NA Ohio Contact Matt Maloney + mmaloney@maloneynovotny.com + Northeast 216.363.0100

RESEARCHED BY CHUCK SODER (CSODER@CRAIN.COM)

Want the full Excel version of this list — and every Crain's list? Become a Data Member: CrainsCleveland.com/data Information is supplied by the companies. Send questions, corrections and suggestions to Chuck Soder: csoder@crain.com.

(1) Rea & Associates acquired Walthall LLP in late 2017.

P023_CL_20181008.indd 23

10/5/18 3:17 PM

PA G E 2 4

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O C T O B E R 8 - 14 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

AKRON

Networks lure business to come, grow, stay

By BETH THOMAS HERTZ clbfreelancer@crain.com

In the past several years, communities such as Fairlawn and Hudson have built high-speed, broadband networks to help attract businesses while, officials say, preparing their communities for the future.

The services are gaining a lot of attention — Fairlawn even played host to a regional conference on the subject in September. And while the services aren’t necessarily profitable in the short term, officials say the investment is paying off in the form of companies moving or remaining within their borders.

Municipally owned fiber services don’t just deliver speed, consistency and reliability, but, importantly, their presence also signals the local government is supportive of future business, said David Corrado, CEO of the Medina County Fiber Network.

Fairlawn began offering its FairlawnGig service in the city and the Akron/Bath/Fairlawn Joint Economic Development District in 2017 and has just over 1,800 customers — 250 are businesses and the rest are residential. Those numbers represent about 45% of the market share, exceeding the goal of 35% usage, said Ernie Staten, Fairlawn’s deputy director of public service.

He’d like to see it at 50% in the near future.

“One thing that probably holds us back is the fact that we don’t offer video. We only offer internet and phone,” he said.

Fairlawn financed the creation of FairlawnGig with a 30-year, $10 mil-

Local municipalities such as Hudson and Fairlawn are finding that their fiber-optic broadband networks are not only luring business, but putting the communities in position for the future. (Bloomberg)

lion loan. Repayments are made from the city’s general fund, freeing up the system to provide the best service at the lowest cost to its customers as part of the city’s strategic plans to enhance quality of life there, he said.

“We are interested in the soft cost of people eating in our restaurants, bringing new business in, increasing taxes, shopping in our malls and spending time in Fairlawn more than we are interested in paying back that debt,” Staten said. “We are trying to make Fairlawn better long-term, not just looking for profits in the short term.”

Staten said that many businesses have been attracted to Fairlawn because of FairlawnGig, including CTMS, an information technology services company; the Kenneth M.

“For a city, what really matters are the outcomes. Most cities don’t get into it to make money. They get into it to provide their citizens with the quality of life that makes living in their city more wonderful.”

— Debra Socia, executive director of Next Century Cities

Crislip law firm; DiLauro Wracher & Thomas, financial advisers; and the Gary Crisp State Farm Insurance Agency. FairlawnGig was also a driving force behind Crystal Clinic’s decision to build a hospital in Fairlawn, he said.

He said FairlawnGig has also helped retain business, citing A. Schulman, Continental and Signet Jewelers as customers who have told

the city that high-speed access was an important part of their decision to stay.

Staten said Fairlawn is close to reaching an agreement with Akron to provide services to city and Summit County government offices and the Bounce Innovation Hub. “I think this agreement is going to be huge,” Staten said. “It will be a win for both communities.”

Fairlawn’s efforts have attracted so much attention that Great Lakes Connect was held there Sept 24-26.

More than 300 professionals toured FairlawnGig’s offices at the event aimed to help Midwestern communities make effective decisions as they build new or expand telecommunications infrastructure.

Debra Socia, executive director of Next Century Cities, a nonprofit group that helps municipalities bring digital equity to their communities, spoke at the conference. She agreed that the idea of “profit” is different when the operator of a broadband service is a municipality, not a business.

“For a city, what really matters are the outcomes. Most cities don’t get into it to make money. They get into it to provide their citizens with the quality of life that makes living in their city more wonderful,” she said.

Having a high-speed offering improves many aspects of life, including transportation, aging in place, health care, communication, property values, education, public safety and economic development, she said.

Part of that, according to Bob Knight, executive vice president and chief operating officer of Harrison Edwards, a strategic public relations and marketing firm that helped promote the conference, is not only attracting big data businesses, but also giving residents the ability to work remotely.

He said 34% of the workforce will be working remotely by 2025, and 100% of it will be doing so at least part of the week by 2022.

SEE NETWORKS, PAGE 25

Akron grabs attention of Chicago-based VC firm “Every city is experiencing growth, but we wanted to show that not all are experiencing the same growth. Akron rose to No. 21, from No. 26. So it rose five spots year over year.”

By DAN SHINGLER dshingler@crain.com @DanShingler

They say success breeds success, and in Akron that seems to hold true in the world of startups and venture capital.

Chicago-based VC firm M25 said it recently made its first investment in an Akron company, SaberLogic. Now it’s looking for more, in part because the city rose significantly among its rankings of the best places to invest in the Midwest.

M25’s first foray into Akron was not the sort of billion-dollar deal that might get attention in Silicon Valley — just $100,000 in what M25 terms its “initial” investment in Akron’s SaberLogic.

But there might be more to come now that Akron has become a bigger blip on M25’s deal radar. The firm thinks Akron is punching above its weight, M25 managing director Victor Gutwein said.

“It’s significantly ahead of similar-sized ecosystems in the Midwest, and that’s exciting,” he said.

For the past two years, M25 has been ranking 54 cities where it invests in the Midwest, roughly between Rochester, N.Y., and Minneapolis. It researches each city and ranks them with a score based on more than 20 factors, ranging from venture capital activity and transactions to things like the strength of local universities, large corporations in the

P024_CL_20181008.indd 24

— Victor Gutwein, M25 managing director

area and support for new and growing firms.

When Akron does something like open its Bounce Innovation Hub incubator for startups, or companies here successfully raise capital, the city’s score rises, and that’s what happened, Gutwein said.

“Every city is experiencing growth, but we wanted to show that not all are experiencing the same growth,” he said. “Akron rose to No. 21, from No. 26. So it rose five spots year over year,” he said.

Other larger cities still likely are to get more attention, he conceded; Cleveland, Columbus and Cincinnati all rank in the top 10 on M25’s list.

“But outside the top 20, there are only four investments we’ve made, and Akron is one of them,” Gutwein said, adding that his firm has invested in 75 companies across the Midwest, always with an initial investment of $100,000.

That’s not all that SaberLogic raised, however. M25 was one of a group of investors — including JumpStart and the North Coast Angel Fund

— that together put $1.85 million into the company in late July.

The SaberLogic founders, brothers Adam and Brian Ellis, said the arrival of M25 is just another sign that Akron is becoming more fertile ground for startup capital. Plus, it’s a sign that their company is becoming a more attractive investment, they said.

SaberLogic provides business software that companies use to link existing enterprise resource-planning software, customer-relationship management programs and other systems.

The company employs 24 people and has grown quickly since in 2016 it introduced a cloud-based version of its product called Bezlio that works on mobile devices.

Since then, Bezlio accounts for 80% of revenue and is SaberLogic’s chief focus going forward, the brothers said.

They still faced years of rejection from investors, though.

“We ticked all the right boxes,” said Brian Ellis, noting that the company has long had a revenue stream, a talented team of developers and mar-

keters, and a proven product. “We still heard a lot of nos, though.”

Now the Ellis brothers are hoping that future investments, if needed, will be easier to come by. That’s often the case with successful companies seeking second-round funding from existing investors.

The SaberLogic founders hope that the company’s success and the presence of M25 will make it easier for the businesses that come after them — and so are others on Akron’s investment scene.

“The more of this the merrier,” said Bill Manby, an Akron investment banker and founder of Acquire Investments.

“Outside funds showing belief in this region is going to help us to better build the local investor base.

We don’t just want all these cool local companies to be successful. We also want to create some local wealth … and build investor confidence here.”

Manby, who said he’s already meeting with M25 to work on potential future deals, said he’s not too surprised to see the firm’s interest. He

recently has seen more outside money express interest in Akron and Northeast Ohio, he said.

“We’re seeing a lot more of that,” Manby said. “I spent a bunch of time with a big private equity firm that’s focused exclusively on the Midwest two weeks ago.

“The attitude is definitely starting to shift. They didn’t say they were only focused on Akron or anything, but there’s definitely more focus on the Midwest. Stuff on the coasts is just so expensive.”

As for M25, time will tell if it puts more money into Akron. It will make the best investments it can find in the Midwest, Gutwein said.

But now it will be exposed to opportunities in Akron. In addition to meeting with Manby, Gutwein said he’s in contact with other Akron investors.

“The JumpStart guys are active in Akron, too, and they’ve been showing us some opportunities,” he said.

Entities such as Acquire, JumpStart and M25 typically don’t make deals on their own and usually are looking for partners, so sharing deals only makes sense, Gutwein and Manby said.

Manby thinks getting capital flowing will unlock still more investment in the area, including by wealthy locals who often sit on the sidelines.

“There’s an existing base of investors that’s kind of waiting to see some other folks get in bed with them,” Manby said. “Hopefully, we can create a snowball effect.

10/5/18 3:01 PM

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AKRON

NETWORKS CONTINUED FROM PAGE 24

Hudson Another community that offers broadband services is Hudson. Like Staten, Jim Stifler, Hudson’s chief economic officer, thinks having these services is imperative to his community’s future.

Hudson has offered its service, Velocity Broadband, for about two years.

It owns and operates the system, which it piggybacked onto infrastructure it already had from owning its electric company, and has spent just over $3 million creating a 60mile, 10 gigabit network.

All of the primary business districts in Hudson have access to it, and

AEROZONE CONTINUED FROM PAGE 1

Perhaps most importantly, Cuyahoga County allocated $75,000 from its development budget to assist the project. The communities within the Aerozone, which include Berea, Brook Park, Cleveland, Fairview Park and North Olmsted, all have committed $2,000 apiece. In addition, according to Stuart Mendel, interim director of the alliance, about $7,000 in private funds have been raised or committed.

Other partners include the Greater Cleveland Partnership, the Ohio Aerospace Institute and Cleveland Hopkins.

Nearer term, the focus is on developing a strong tie to NASA Glenn.

Mendel, retired assistant dean of the Maxine Goodman Levin College of

“When I look at Cleveland history books, they don’t really mention NASA. I think we are trying to establish ourselves in the next pages of that history to have a better relationship to the community.”

— Sandra Reehorst, acting director of NASA Glenn’s technology incubation and innovation office

Urban Affairs at Cleveland State University, is working to organize the group and build the relationship with the center.

Mendel believes there is an opportunity to attract startup businesses that win research grants from NASA Glenn to move into an incubator the alliance is creating in space it has leased in a building at 2000 Aerospace Parkway, just outside the Cleveland Hopkins grounds in Brook Park.

While much research is done on the NASA Glenn grounds by civil service and contract employees, the center does work with private firms, sometimes through patent licensing or an SBIR grant to help a business get started, that can make a product that NASA needs. NASA Glenn has made 123 SBIR grant awards in recent years.

“We want to work with SBIR projects at the startup time, when they are taking projects to scale,” Mendel said. “That would be people who have decided to go into business.

They just need resources.”

P025_CL_20181008.indd 25

To the west, the Medina County Fiber Network is an open network.

CEO Corrado compared it to having built a railroad track — providers can use it to deliver their service to customers.

“We take existing carrier services and make them better,” including being up to 100 times faster, and offering redundancies to avoid outages and reducing construction time, he said.

Fourteen carriers are on his network, which is owned by the county and operated by the Medina County Port Authority. Customers can choose a carrier to best meet their needs.

About 175 businesses use the network, including eight of the 10 largest employers in Medina County. He attributes the system with retaining more than 1,000 jobs in Medina County and creating 400 new ones.

He estimates that availability of a

fiber network was involved in the decision by about 20 companies to move to or expand in Medina County.

One example of a company that was attracted by the service is software and web development company Ethode, which also serves as a carrier/data center on the network, Corrado said.

He said the presence of a municipal fiber network is one of the top five questions asked by companies that are considering locating in Medina County.

“They don’t ask if fiber is available; they specifically asked about a municipal fiber network because then the company knows that the local government is supportive of future business and can provide many choices for fiber services,” Corrado said.

gineering and product development services to NASA, the U.S. Department of Defense and others, believes in the aerotropolis concept and has agreed to join the alliance board. He’s thinks the alliance can play a role in reinvigorating the regional economy.

“It’s not all figured out, but the focus on NASA Glenn makes sense,” he said. “(NASA Glenn) can’t decide

they are only going to give SBIRs to local companies, but (the alliance) can help” make locating in the area more attractive.

At an alliance organizing meeting Sept. 25, Robert Kennedy, Cleveland airports director, offered the group of about 30 some encouragement that the airport will be playing a role in the alliance.

“We have worked hard to make our airports, Cleveland Hopkins and Burke Lakefront Airport, economic catalysts,” he said. “I was taught long ago that the most important things at an airport happen outside the fences of the airport. It’s the jobs it brings to people, the economic vitality and the future of what can be. That’s what you guys are talking about — the future.”

about 200 companies use it.

Stifler estimated that there are up to 300 more potential business customers. He said about 100 companies use Velocity just for phone service as well.

He said the system, which the city hopes to someday offer residential users, is “on the verge of profitability,” but the bigger picture of economic development.

Year-to-date, Hudson’s income tax revenues, which are paid by people who work within the city borders, are up 14%.

“More businesses are coming here, and they are higher-paying and what I call future-friendly businesses,” Stifler said. “Those are almost invariably businesses that are technology oriented and want fiber.”

Businesses that have been attracted to Hudson by Velocity include As-

surance Health, ForTec Medical and recruiter On Partners, he said. Velocity helped Kaulig Capital, financial consultants, and Yxlon, maker of X-ray and CT systems, grow in Hudson, he added.

The growth at Hudson Crossing Park Business, along state Route 303 near state Route 8, is heavily tied to Velocity and has brought nearly 800 jobs on site and promised $85 million in net investment, he said.

Stifler expects that the two remaining lots that have not been committed in the business park will push the complex to 1,000 jobs and $100 million in investment in late 2019 or early 2020.

Its research focuses on propulsion systems, aerospace communications, power and energy conversion and materials, including a new polymer aerogel that spawned a business whose product insulates spacesuits. NASA Glenn cannot require grant awardees to locate nearby, but Mendel believes there is an opportunity to market work space to those businesses.

“NASA has a really great track record in helping SBIR projects develop,” he said. “But they are not allowed to be biased in any way. So those firms go anywhere in the United States. What we’re trying to do is tap into that” and convince them to locate in the Aerozone.

Mendel also believes there is an opportunity to attract scientists who are retiring from NASA but have business ideas they want to develop.

“So we want to provide them work space,” he said.

One hurdle has been that NASA Glenn has not done a good job of engaging the community that surrounds it.

“What NASA is good at is looking for technology in the United States that applies to what they are doing,” said Howard Thompson, a senior director of business development at the Greater Cleveland Partnership, who until recently was a project coordinator at the Ohio Aviation Institute, where he was involved with the effort to build the Aerozone Alliance.

“What they are not good at is marketing its research to be around NASA.” Thompson said the NASA Marshall Space Flight Center has had a major economic impact on its host city, Huntsville, Ala., and the surrounding area. According to a 2017 report by the NASA Marshall Space Flight Center, it is the second-largest employer in the county with 6,000 federal and contract employees. Its work supports an additional 16,000 jobs in the area, a total of 22,000 in Alabama.

NASA Glenn, which has half as many employees, estimates its work generates over 7,000 jobs in Ohio.

But NASA Glenn is changing its approach and trying to be more engaged in the community around it, said Sandra Reehorst, acting director of NASA Glenn’s technology incubation and innovation office.

“I think we’re more focused on that than before,” she said. “When I look at Cleveland history books, they don’t really mention NASA. I think we are trying to establish ourselves in the next pages of that history to have a better relationship to the community.”

Carlos Grodsinsky, chief operating officer of ZIN Technologies Inc., a Middleburg Heights firm that provides en-

Medina County

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CRAIN’S CLEVELAND BUSINESS

ADVERTISING SECTION

To place your listing, visit www.crainscleveland.com/people-on-the-move or for more information, contact Debora Stein at (917) 226-5470 / email dstein@crain.com.

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ENGINEERING & CONSULTING

Joe Hicks thunder::tech

Jeremy McIntire CTL Engineering, Inc.

We are pleased to announce that Jessica Hartman has been promoted to Partner. With over 18 years of accounting experience, both in public and industry roles, she works closely with clients to understand and address their complex accounting and business needs.

Jessica specializes in consumer and industrial products and is aligned with the audit practice. Clients include public and privately held companies, as well as employee benefit plans.

thunder::tech is proud to welcome Joe Hicks as an Account Services Group Leader. Joe comes with more than 20 years of experience in advertising and a degree in economics from Wheaton College. As a senior vice president at Stern Advertising, he led award-winning work for national accounts, including McDonald’s. Joe is excited to bring his expertise and passion for the art of consumer influence to provide creative thinking and a deeper level of strategic guidance for thunder::tech’s clients.

CTL Engineering, Inc. (CTL) is excited to announce the addition of Jeremy McIntire to its team.

As Project Manager/Project Engineer in CTL’s Akron, OH office, Jeremy will be instrumental in the growth of CTL in that region. Jeremy earned his BS Construction Engineering Technology from the University of Akron. His background includes working for the Ohio Department of Transportation, District 4, as Transportation Engineer.

Jeremy is also a U.S. Army Veteran of Operation Iraqi Freedom.

NONPROFIT

PROFESSIONAL SERVICES

REAL ESTATE

Douglas DeRose National Tooling & Machining Association (NTMA) The National Tooling and Machining Association (NTMA) is pleased to announce that Doug DeRose has been promoted to the new position of VP/Chief Operations Officer (COO). In this new role, Doug will responsible for the day-to-day management of the NTMA office, which includes Membership & Business Development, Workforce Development and Administration. Doug has been with NTMA since 2013 and previously held the title of VP/CFO.

Direct Recruiters, Inc. (DRI), Executive Search, is pleased to announce that Shawna Rosner has joined their team as Director, Legal Solutions Group. Shawna combines over 24 years as an attorney, 15 years as a career coach as well as 7 years of recruiting experience, bringing a comprehensive skill set to the legal recruiting market. She is uniquely positioned to help clients secure the best legal candidates to fit their short and long-term needs.

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Learn more at www.karpinskieng.com.

Singerman, Mills, Desberg & Kauntz Co., L.P.A. is pleased to announce that Stephen L. Byron has joined the Firm as a Principal. Prior to joining the Firm, Steve practiced at Walter|Haverfield, focusing on public sector law. Steve is currently the Law Director of the following municipalities: Hunting Valley, Orange Village, Pepper Pike, and Waite Hill, and acting Law Director of Willoughby Hills.

NEW GIG?

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Preserve your career change for years to come.

Newmark Knight Frank (NKF) is pleased to announce that Camille Norton has joined a team led

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SOURCE LUNCH

Zahid Afzal

CLEVELAND BUSINESS

Chief operating officer, Home Savings Bank For Home Savings Bank, the Youngstown-based subsidiary of United Community Financial Corp., landing Zahid Afzal as its latest chief operating office was a coup.

Afzal, a native of Pakistan who came to America in 1984, became involved in the tech sector post-college before making his way into the banking realm. He has since worked for major institutions including Citibank, Bank of America and Huntington Bank before joining a de novo operation in North Carolina-based Capital Bank (which was acquired in 2017), leveraging his tech experience at each endeavor. ¶ Afzal was highly sought after by large financial institutions after that deal went through, but opted to join Home Savings, whose board of directors he originally joined in 2013. Now several months into the job, Crain’s sat down with Afzal to get a sense of his work at his latest firm and his thoughts on the banking climate today and going forward. — Jeremy Nobile

The Afzal file Something people don't know about you?

I used to be a professional chef.

Anything you're currently reading?

I'm listening to "Enlightenment Now"

by Steven Pinker

If you could have lunch with any famous or historical person?

Warren Buffet. I'd pay money to have lunch with him.

Lunch spot Blue Pointe Grille 700 W. St. Clair Ave., Cleveland 216-875-7827

The meal Lobster bisque, ginger ale and each had the grilled salmon salad with mesclun, artichokes, buttermilk blue, almonds and balsamic vinaigrette.

The vibe Upscale seafood restaurant that manages to not feel overly pretentious with its bright, open space and blue-and-white aesthetic.

The bill $42.07, plus tip

You could’ve probably had your pick of banks to work for with your experience. Why join a smaller community bank like Home Savings after Capital Bank was acquired?

I did have a number of opportunities.

But once you get a taste of being a startup (via Capital Bank), it’s hard to go back to the corporate world.

Obviously, the compensation is appealing. But once you get to see how you can be innovative, hands-on and make a faster impact to customers and the organization, I knew I wanted to stay with a smaller institution.

There's probably a lot more freedom, right?

You bet. We’ve accomplished a lot in my six months, and that’s the beauty when you’re in a smaller environment.

You can make decisions, cut through red tape faster. That’s not to say large banks don’t get stuff done, too.

It’s just a different process. It’s more straightforward here.

So what’s a top initiative you’re working on today as COO at Home Savings?

I’ll start with strategy. With community banks, customers come to us because they like the relationship aspects. They feel like they can get better attention. What we’re working on is taking that to the next level by asking: How can we be your trusted adviser? Not just selling products based on your immediate need, but how to build that advisory type of relationship. That’s the message today. But it’s easier said than done.

There’s a lot of intelligence, and that’s where technology plays a critical role

because you have to know the customer. And to know the customer, you have to gather enough information, and then track it.

Are you making sure more capital flows toward investments in related tech, then?

You bet. I couldn’t put a percentage on it. But if I take a three-year view, the investment is significantly more.

And those investments are driven by our business cases.

Some other big topics in banking this year are tax reform and the regulatory environment. How are either affecting the bank today from your point of view?

Of course tax reform helps. But that’s short-term. How much of a long-term effect that has is a question mark. And I don’t think anyone knows what happens with that. In terms of regulations, I have a slightly different perspective than my peers.

It's fair to say most bankers are pretty anti-regulation. Are you not in the same camp?

I’m a fan of regulators, which shocks some people. They are there for a valuable purpose. Without appropriate regulations, you saw the financial crisis. So the right level of regulations that are balanced is a good thing. There are aspects of Dodd-Frank and anti-money laundering that I’m a huge fan of.

Without them, you don’t have the proper checks and balances.

Should we roll back more regulations?

I don’t think we want to swing the

pendulum back to where we used to be prior to the financial crisis. There are some very good controls regulators put in place to ensure the same situations don’t occur again.

Could they? Sure. But a lot of it deals with people. If I lower my credit standards to a particular level, no regulation is going to come in and fix that. But to have a systemic breakup of that nature, undoing these things, that would be a mistake. We should look back at what’s working and what’s not, and let’s not screw up what’s working.

Any perspective on the governor’s race? Finance types seem generally leery of Richard Cordray because they don’t like the Consumer Financial Protection Bureau. Do you view the election differently at all because of that?

As bankers, we all hated the CFPB, to be honest, because the notion was, here we go, we have one more agency to deal with. This agency has no controls whatsoever and they’re completely on their own and can tell you what to do. That’s what the feeling was, anyway. As we went along, coming out of the financial crisis, Cordray was given a clean slate and for him to take a truly customer-centric view that didn’t exist at the time, to me that was tremendous. It’s not about the government agency, it’s about customers. And we have to look at the agency that way. Sure, some banks struggled with regulations.

But I have to give Cordray a lot of credit. I think he did some wonderful things and, along the way, a couple crazy things.

700 W. St. Clair Ave., Suite 310 Cleveland, OH 44113-1230 Phone: (216) 522-1383 www.crainscleveland.com Twitter: @CrainsCleveland Publisher/editor Elizabeth McIntyre Group publisher Mary Kramer Managing editor Scott Suttell Creative director David Kordalski Web editor Damon Sims Associate editor/Akron Sue Walton Assistant editor Kevin Kleps Senior reporter Stan Bullard, Real estate/construction Reporters Jay Miller, Government Dan Shingler, Energy/steel/auto/Akron Rachel McCafferty, Manufacturing/energy/ education Jeremy Nobile, Finance Lydia Coutré, Health care/nonprofits Data editor Chuck Soder Cartoonist Rich Williams Events manager Ashley Ramsey Marketing coordinator Megan Lemke Integrated marketing manager Michelle Sustar Managing editor custom/special projects Amy Ann Stoessel Director of advertising sales Lisa Gray Senior account executive Dawn Donegan Account executive Laura Kulber Mintz Office coordinator Denise Donaldson Pre-press and digital production Craig L. Mackey Media services manager Nicole Spell Billing Peter Iseppi Credit Rod Warmsby Crain’s Cleveland Business is published by Crain Communications Inc.

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THE WEEK On second thought ...

clid Avenue in downtown Cleveland, in a $90 million project.

Michael Sabracos, CEO of the U.S. unit of Istanbul-based AltoPartners, said he expects construction workers hired by Panzica Cos. of Mayfield Village to set to work “within weeks” on the three-building, six-story complex at 1001-1101 Euclid Ave. He expects the project, using state and federal historic tax credits, to be finished in 2020.

Myers Industries Inc. is staying in Akron after all.

The company, which sought a $400,000 loan from Cuyahoga County for a move that eventually would have brought 140 jobs to North Point Tower on East Ninth Street and Lakeside Avenue, said Oct. 1 that the move is off.

In a statement, Myers said it “determined that the costs associated with the move would be higher than anticipated and impacted our ability to create the open and collaborative space we envisioned.”

Huntington closures

A fresh start Construction workers soon will start restoring to life the John Hartness Brown building complex, one of the last big dead zones on lower Eu-

P027_CL_20181008.indd 27

A group of buildings at 1001-1101 Euclid Ave. is about to be converted to more than 200 apartments. Windows, missing since a modernist metal facade was removed several years ago, will replace plastic sheets that have been blowing in the wind. (Stan Bullard)

Huntington Bank will close about 30 branches in Ohio and a total of 70 branches in its eight-state footprint around the beginning of 2019.

Of those, 18 are in Northeast Ohio, including 10 in the Cleveland market. All the branches will be consolidated into other nearby locations. The ones being closed were chosen because of lower

customer traffic compared to others and their proximity to other branches.

A Huntington spokeswoman declined to say how many people work at the affected branches or how many could be laid off.

Moving on Hudson-based fabric and crafts retailer JoAnn Stores is in the market for a new CEO. On Oct. 2, Jill Soltau resigned as president and CEO, effective immediately, to take the CEO job at iconic retailer J.C. Penney Co. At JoAnn, Wade Miquelon, the company’s executive vice president and chief financial officer, will serve as interim president and CEO while continuing in his current role until the company concludes an executive search process.

10/5/18 3:09 PM

NOW ANNOUNCING

THE 2018 FORTY UNDER 40 CLASS They may be young, but they are making their professional imprints all over Northeast Ohio. Crain’s Cleveland Business congratulates this year’s Forty Under 40 class.

CRAIN’S

Ian Andrews LakewoodAlive Brittan Berry University Hospitals Ventures Jennifer Borowy Buckeye State Credit Union

Edward Buchholz StartInCLE

Ryan Buckley The Cleveland Orchestra

TECHNOLOGY PARTNER

Brad Owen NeverBounce

40

FORTY UNDER 40 CO-PRESENTING SPONSOR

Rosheadra Edwards FirstEnergy Corp.

Emily Campbell The Center for Community Solutions Conor Coakley CBRE, Inc.

Alex Cooper Bank of America

Julie Crocker Taft Stettinius & Hollister LLP

NOV. 19, 2018

5:30 -- 8:30 PM

LA SALLE THEATRE 821 E. 185th St., Cleveland

Crystal M.C. Davis Alliance for the Great Lakes; Thornton Buckeye Group Mannik S. Dhillon Victory Capital Management

Rayshawn Eatmon Progressive Insurance

Dimetrius L. Harris Sr. Citizens Bank

Daniela Paez Ulmer & Berne LLP

Dakota King-White Cleveland State University

Jennifer Palinchik JALEX Medical, LLC

Steven M. Lake NewBridge Cleveland

Sanket Patel BrandMuscle, Inc.

Justin D. Lathia Cleveland Clinic Lerner College of Medicine

LaRese Purnell CLE Consulting Firm

Daniel Luketic North Coast Angel Fund

Hallie Rich Cuyahoga County Public Library

Barbara A. Lum Benesch

Ian Schwarber DriveIT

Nkosi H. Mason Cleveland Clinic Akron General

Kelly Seabold The MetroHealth System

Sean E. McDermott Cleveland Metroparks

E. Sean Medina Hahn Loeser & Parks LLP Zhenting Men Cleveland International Fund Kyle Miller Dominion Energy Chad Minor Cleveland Clinic

Gustave Molnar Quicken Loans; Gustave Development

Annaliese Soden Cleveland Museum of Art Ezra Stark Stark Enterprises

Pallavi Tiwari Case Western Reserve University

Madalynn Wendland Cleveland State University Jonathan Whigham Huntington Bank David Wintrich Tech Elevator

LEARN MORE ABOUT THE CLASS AND THE NETWORKING EVENT WHEN YOU VISIT

www.crainscleveland.com/40u40

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EVENT/REGISTRATION QUESTIONS: clevents@crain.com | SPONSORSHIP OPPORTUNITIES: Lisa Rudy • lrudy@crain.com

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