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Volume 20, No. 11, September 25, 2019

Medicaid Expansion Effects Still Being Assessed

Spotlight

on:

Health Care Page 4


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SHENANDOAH VALLEY BUSINESS JOURNAL

Wednesday, September 25, 2019

Inside This Issue The Shenandoah Valley Business Journal is a monthly publication of the Daily News-Record, 231 S. Liberty St., Harrisonburg, VA 22801.

Editorial Staff

Focus Section: Health Care ■ Medicaid Expansion Effects Still Being Assessed....Page 4

Other Business News ■ Tourism Spending Increases...............................Page 3 ■ InterChange Celebrates Facility’s Completion.....Page 7

Publisher: Craig Bartoldson

■ Harrisonburg Brothers Bet On Hemp................Page 10 ■ Valley Company Buys City Plant......................Page 13 ■ Town To Pursue LFCC Connection In Grant.......Page 13 ■ Firm Plans To Open Distribution Center..............Page 15

Contributing Writers: Ian Munro Josette Keelor Josh Gully Contributing Photographers: Daniel Lin, Ian Munro, Josette Keelor

HARRISONBURG — Eight attorneys in a Shenandoah Valley law firm were named in “The Best Lawyers in America” 2020 edition. Selected by their peers, the attorneys from Wharton, Aldhizer and Weaver were recognized in the following categories: • Daniel L. Fitch, personal injury litigation, defendants • Charles F. Hilton, medical malpractice law, plaintiffs, personal injury litigation, plaintiffs, professional malpractice law, plaintiffs • Glenn M. Hodge, health care law, real estate law • Stephan W. Milo, bankruptcy and creditor debtor rights/insolvency and reorganization law

Contact us By mail: Shenandoah Valley Business Journal P.O. Box 193 Harrisonburg, VA 22803 By email: svbjnews@dnronline.com By fax: 540-433-9112

■ 4 Ways To Cover College.................................Page 12

Managing Editor: Jim Sacco

Eight Local Attorneys Named ‘Best In America’

Harrisonburg, Va.

On The Cover:

Columns ■ Investements with Matthew Frakes................Page 6 ■ Financial Focus with Kathy Armentrout..........Page 8 ■ Leadership with Robert McFarland...............Page 11

• Donald E. Showalter, corporate law, trusts and estates • Gregory T. St. Ours, antitrust law • Thomas E. Ullrich, commercial litigation, employment law, management, litigation, labor and employment • P. Marshall Yoder, collaborative law: family law, family law Wharton Aldhizer and Weaver is a full-service firm with offices in Harrisonburg and Staunton. The firm serves individuals and businesses in the Shenandoah Valley and the mid-Atlantic states in the areas of: bankruptcy, commercial and civil litigation, corporate finance, employment law, health care law, intellectual property matters, medical malpractice, real estate and land use, tax planning, wills, estate planning, and administration.

— Staff Reports

By phone: 540-574-6281 (news) 540-574-6223 (ads)

Binkley & Hurst To Consolidate Locations HARRISONBURG — The two local locations of Binkley & Hurst, an agriculture equipment dealership chain, will be combined into a single location in the coming months, said Don Hoover, the owner of Binkley & Hurst. The chain has only two locations in Virginia, both of which are in the Harrisonburg area. One location, near Dayton on Rushville Road, focuses on heavy agriculture equipment and maintenance, while the other at 4703 S. Valley Pike focuses more on lawn equipment and rentals. That new location will be right across the street from the South Valley Pike location. Hoover declined to reveal the price tag

Daniel Lin / DN-R Sentara RMH Hahn Oncology Center radiation therapist Malora Bush preps a linear accelerator for a patient on Sept. 19.

of the project, which is slated for completion in the first quarter of 2020. After construction is finished, all the equipment, items and employees will be relocated to the single location south of Harrisonburg. Three employees from the Valley Pike shop will be moving across the road, while nearly 20 employees will be moving to U.S. 11 from the Rushville shop. Hoover said the company expected to create more jobs “in time.” The unified Binkley & Hurst location will feature eight bays, a glass storefront facing South Valley Pike and a large service area for technicians. The plan to combine the locations has been in the works since 2016, according to Hoover.

— Staff Reports


SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Tourism Spending Increases Throughout The Commonwealth By IAN MUNRO

Daily News-Record

HARRISONBURG — Over $231 million of Rockingham County revenue was generated by tourism in 2018, an increase of 6.1% from 2017 and the most money generated in a Shenandoah Valley locality, according to data from the United States Travel Association. Every locality in the Commonwealth saw an increase in tourism last year, resulting in $26 billion in travel spending combined across the state. “I think we’re just very fortunate that Rockingham was the top spot,” said Joshua Gooden, tourism and economic development coordinator for Rockingham County. “But also looking at all the numbers throughout the Valley and seeing how important tourism is for everywhere.” Nearly 2,200 jobs were directly supported by tourism in Rockingham County last year, an increase of about 60 jobs from 2017.

To help continue growth in the tourism sector, representatives from localities throughout the Shenandoah Valley from Clarke to Rockbridge meet once a month, typically in Harrisonburg, to discuss ongoing projects and best practices to draw visitors in. “The visitors that come to Massanutten won’t specifically stay in Rockingham,” Gooden said. “They’re looking to explore what’s going on in the whole community.” The Shenandoah Spirits Trail is an example of a successful partnership between the localities, said Jenna French, director of tourism and business development for Shenandoah County. Shenandoah had plenty of vineyards, but Harrisonburg had the breweries. “So we thought this was a great opportunity to work together,” she said. Though Rockingham had the highest expenditures, Shenandoah saw the highest

See TOURISM, Page 9

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www.harmanconstruction.com

Wednesday, September 25, 2019

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Wednesday, September 25, 2019

SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Effects Of Medicaid Expansion Still Being Assessed By IAN MUNRO

Daily News-Record

HARRISONBURG — Virginia hospitals are anticipating to see a drop in costs after the recent Medicaid expansion brought the option of coverage to an estimated 400,000 Virginians at the beginning of the year. In Harrisonburg and Rockingham County, 1,903 and 2,542 people respectively now have coverage through the Medicaid expansion after previously going without insurance, according to data from the Virginia Department of Medical Assistance Services. To offer Medicaid to more Virginians, the law raised the income eligibility to allow more people who were struggling to make ends meet to have access to Medicaid. This translates to roughly a single person who makes $16,754 a year, or 138% of the federal poverty level based on the family size. The expansion is a direct result of the Affordable Care Act, also known as Obamacare, said Julian Walker, vice president of communications for Virginia Hospital and Healthcare Association. Multiple legal challenges sprung up after the law was signed in 2010. A Supreme Court decision in 2012 ruled that the federal government could not force the states to expand Medicaid eligibility, which was part of how costs would be controlled by the Affordable Care Act, Walker said. So in the years since the passage of the health care overhaul — but before the medicaid expansion — more people found themselves without coverage. “For providers, it was sort of like burning the candle at both ends,” Walker said. Medicaid, and it’s slightly different twin Medicare, do not pay the full tag price of hospital visits, he said. The shortfall between what hospitals had spent on care for customers with Medicaid coverage and what Medicaid paid hospitals for that care was $668 million in 2015.

Photos by Daniel Lin / DN-R

Sentara RMH radiologic technologist Ashley Kimble sets up an X-ray machine on Sept. 19. By 2016, that gap had increased to $909 million, according to Walker. Increasingly, hospitals in states which had not expanded Medicaid found themselves taking on more and more of the costs associated with the national health care overhaul. From 2016 to 2017, there was a 43% increase in Virginia hospitals with operating in the red, with 57% being in rural areas during 2017. However, many local hospitals are still unsure of the exact effect the expansion has had on their business as of yet. Based on findings in other states which expanded Medicaid

coverage in previous years, those hand-over-first care costs hospitals were taking decreased. “Studies that have been done on the Medicaid expansion in other states find it significantly decreases the uninsured rate, reduce disparity in health care, disparity racial and ethnic disparities as well as urban rural disparity,” said Timothy Jost, a nationally recognized health care policy and law expert and professor emeritus at Washington and Lee University. And there are some signals Virginia may see the same results. “I can tell you that our uncompensated care for August of this year has gone down 1.5% compared to last year,” said Portia

Brown, vice president of Page Memorial Hospital and president of the Virginia Rural Health Association. Valley Health, which includes Page Memorial Hospital in Luray and Shenandoah Memorial Hospital in Woodstock, saw an increase in walk-ins of all six of their rural clinics as well, Brown said. “We definitely have seen an increase and uptick in our clinic visits and I believe it to be a result of the expansion,” she said. This helps hospitals because people will be able to get more preventative care, making it less likely they come in for expensive care in hospitals, Brown said. Hospitals are required by law to

adequately care for people in dire situations, no matter their ability to pay. And when hospitals lose money providing care for those on Medicare and Medicaid, they do not raise prices on other consumers to make up for lost ground, Jost said. The term for charging others more to make up from previous losses is referred to as cost-shifting. A majority of experts don’t believe cost shifting happens with Medicare and Medicare, in what has been a long term argument, Jost said. “From the standpoint of classical economists, cost shifting can’t exist,” Jost said. “But it’s still more complicated.”


Harrisonburg, Va.

SHENANDOAH VALLEY BUSINESS JOURNAL

Sentara RMH Medical Center emergency room nurse Tina Palmer works the nurses station on Sept. 19. Before the expansion in January, a majority of the people in the program were low-income children and pregnant women, while a minority of enrollees were Virginians with serious disabilities, he said. “Historically, Virginia has had its Medicaid eligibility has been among the more restrictive in America,” Walker said. However, it was the minority of seriously disabled Virignians with the highest cost of care, Walker said. A major point of debate before the expansion passed the state house was the increased burden to the state the new costs of care would inflict. Initially when introduced through the ACA, states’ Medicaid expansion would be covered 100% by federal funds with a note to slowly transition to have the state pay more up to a maximum of 10%. In 2020, the state’s share will reach its maximum of 10% and many across Virginia were concerned about the cost. Hospitals are also the only industry to pay into the coffers of the state to help afford the expansion, even though Medicaid and Medicare benefits can be used on a variety of services including stay at home care and pharmaceutical products. “In a full a year, Virginia hospitals will contribute a little more than $300 million to the state to cover that 10% cost of medicaid expansion,” Walker said. “Right now, we’re at about 314,000 enrolled since the coverage program enrollment began in November 2018 and began Jan. 1, 2019,” he said. “Those are phenomenally positive results for this program of the new coverage that has been available for eight or so months.” The expansion created an opportunity for the Harrisonburg-Rockingham Free Clinic,

said Summer Sage, the executive director of the clinic. The clinic started accepting patients regardless of their citizenship status starting in May after seeing 600 people be insured following the expansion, she said. Legal immigrants working in America on visas are taking themselves, and their children in some cases, off of Medicare rolls in anticipation of the “public charge rule” that is set to go into effect on Oct. 15, Sage said. The rule would deny residency status to those who use programs supported by taxpayer money, such as food stamps and Medicaid. The rule was put forward by Ken Cuccinelli, director of the Citizenship and Immigration Services and former Virginia attorney general. And they are not the only ones still going without insurance. Initial estimates said 2,383 Harrisonburg residents and 3,082 Rockingham County residents would be able to get insurance through the Medicaid expansion. That still leaves about 1,000 people without insurance in the Harrisonburg-Rockingham area who are now eligible. As well, there are another 59,000 eligible Virignians have not signed up and more than 300,000 people are still not covered by the expansion, Walker said, which still presents a challenge in the future. The true effects and data related to the expansion will probably not be known for another 18-24 months, he said. “Since we’re still early in the experience with this, it’s difficult to draw firm conclusions,” Walker said. Contact Ian Munro at 574-6278 or imunro@dnronline.com. Follow Ian on Twitter @IanMunroDNR

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SHENANDOAH VALLEY BUSINESS JOURNAL

Wednesday, September 25, 2019

Harrisonburg, Va.

Help Protect Your Finances In A Natural Disaster From blazing wildfires and floods to hurricanes and tornadoes, natural disasters make front-page news whenever and wherever they happen. Less headline-worthy are the financial repercussions that follow, which tens of thousands of people are dealing with right now. These types of tragedies are unavoidable — the most you can do is prepare to minimize the time it Matthew R. Frakes takes to put the pieces of your life back together. Creating a plan that addresses your coverage amounts — pay attention to the finances and insurance beforehand can abandon your house quickly. riders as well. make it easier to recover from a devasFor instance, does your property insur3. Protect Your Credit tating event. Part of protecting your finances in- ance cover temporary food and housing costs volves protecting your credit. Include the if you’ve had to evacuate but your home is 1. Stockpile Savings Maintaining an emergency fund with contact information for your creditors undamaged? If you miss work for a week three to six months’ worth of savings is a — such as your mortgage lender, credit because you’ve had to evacuate, will your key part of any household budget. But it’s card companies and utilities — in your disability policy cover your lost income? also important in an emergency: Funds that financial preparedness kit. If you have Talk to your agent about covering any gaps you can draw on quickly and easily can be a to evacuate, reach out to your creditors in your policies, and make sure you know lifesaver in the wake of a natural disaster. as soon as possible to request a tempo- whom to contact and what documentation Also consider keeping a few hundred dollars rary reprieve from payments. Make sure you’ll need to file a claim. in cash on hand to see you through if your you reach out to your employer as well, area loses power or banks and ATMs are to provide as much warning as possible 5. Use A Checklist if you won’t be able to work in the afterInclude your financial preparations in out of commission. math of a disaster. your overall disaster recovery plan. Use a checklist to make sure you are giving your2. Gather Key Documents self the best chance of recovering from a nat4. Review Your Insurance Make sure you have important legal Your insurance policies can help you re- ural disaster. The Federal Emergency Manand financial documents with you if you have to evacuate. These may include cop- cover financially from a disaster, provided agement Agency’s (FEMA) website (https:// ies of insurance policies and even bank ac- you have the right coverage. Review your www.ready.gov/) is a valuable source of incount numbers. Keep these documents eas- property, flood, life and disability insur- formation and guidelines to help you plan. ily accessible, as you would flashlights and ance policies once a year when you receive Just remember — the more you prepare spare batteries. That way you’re less likely the new documents from your insurer. And now, the less you’ll have to do if disaster to leave them behind — even if you have to don’t focus only on your deductibles and strikes.

Investments

Take Charge of Your Financial Future Guiding Clients Through Long-Term Care Insurance Stuart French helps clients consider options to help manage the impact of long-term care expenses on his clients’ financial positions. Reach out for a complimentary consultation today by contacting sfrench@janney.com or by calling 540.236.9220.

Stuart T. French, Financial Advisor Lantz & Gochenour Investment Group of Janney Montgomery Scott LLC 313 Neff Avenue, Suite E, Harrisonburg, VA 22801 | lantzandgochenour.com © JANNEY MONTGOMERY SCOTT LLC • MEMBER: NYSE, FINRA, SIPC

This article was written by/for Wells Fargo Advisors and provided courtesy of Matthew Frakes , Financial Advisor in Harrisonburg at (540) 801-3211. Investments in securities and insurance products are: NOT FDIC-INSURED/ NOT BANK-GUARANTEED/MAY LOSE VALUE Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company. © 2018 Wells Fargo Clearing Services, LLC. All rights reserved.


Harrisonburg, Va.

SHENANDOAH VALLEY BUSINESS JOURNAL

Wednesday, September 25, 2019

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InterChange Celebrates New Facility’s Completion By IAN MUNRO

Daily News-Record

MOUNT CRAWFORD — Years of planning, 18 months of construction and more than $41.6 million later, the new InterChange cold storage facility in Mount Crawford is operational. Gov. Ralph Northam and Virginia Secretary of Agriculture and Forestry Bettina Ring joined state Sens. Emmett Hanger, R-Mount Solon, and Mark Obenshain, R-Rockingham, InterChange leaders and Rockingham County Supervisor Bill Kyger for speeches before the ribbon-cutting ceremony on Sept. 19. “It will do so much to support our food and beverage industry — and we know that that in turn supports our farmers,” said Ring. The 250,000 square foot warehouse has room for 30,000 pallets and will nearly quadruple the company’s cold storage capabilities, according to previous Daily News-Record reports. Agriculture is the largest industry in Rockingham County and the Commonwealth, providing work for 334,000 Virginians. “To be able to see what has happened because of hard work and dedication of this company and this community — it’s truly huge,” Ring said. The site will also employ 88 people, bringing the company’s total payroll to about 200 local workers. Northam reiterated his administration’s commitment to job creation and being a business-friendly state during his remarks. “To be able to come here and announce the opening of a new business that will provide close to 100 new jobs — that’s an exciting day anywhere in Virginia,” Northam said. Creating and promoting jobs helps to build a better business environment in the Commonwealth, he said. “It’s all about identifying what the jobs of the 21st century are and then training our youth for those jobs,” Northam said. The project received money from a number of groups, including $300,000 from both Rockingham County and an Agriculture and Forestry Industries Development grant, $650,000 from the Virginia Department of Transportation’s Economic Development Access Fund and $450,000 from the Rail Industrial Access Program. The cold storage operation is the first purpose built cold storage facility built in the area in the past 20 years and the first

purpose built cold storage facility InterChange has built, said Devon Anders, president of InterChange. The company operates other cold storage facilities, but they were retrofitted for purpose. Rockingham County and the Virginia Department of Transportation worked on the 1-mile road extension up to the site, and Anders thanked the groups for their support. The section of Crowe Drive to the facility is 48 feet wide to accommodate for trucks entering and leaving. Already, about 100 trucks access the site every day, Anders said. Even as operations are underway at the facility, there are plans to keep improving the site. Slated additions include a blast freezer, solar panels and a rail spur to connect to the nearby railway line. A blast freezer can freeze food products faster than traditional methods, and in Ian Munro / DN-R turn, reduces chances of contamination by microbes, Anders said. Gov. Ralph Northam presents a flag to InterChange President Devon Anders before the ribbonThe blast freezer will be a value add for cutting ceremony for the company’s new cold storage facility in Mount Crawford on Sept. 19. InterChange, he said, as many local poultry producers have a need for blast freezing. The facility is also the first site of its kind on the planet to use Jungheinrich semi-automated forklifts. The lifts use radio frequency identification, known as RFID, to drive along the narrow aisles of stacked goods and can grab pallets with minimal work from the operator. The machines receive orders from the warehouse management system to retrieve pallets from temporary storage. Similar models used in the company’s native Germany operate completely autonomously, Anders said. The lifts could eventually be upgraded to be fully autonomous, but as of now, InterChange employees drive the Jungheinrichs. InterChange is again investing in solar, as it has throughout the Valley. In April, the company unveiled a $3 million project for four of its buildings in Mount Crawford. The infrastructure of the building is prepared for solar, and Anders said they anticNEW LOCATION Conveniently located ipate to buy the panels later this year, with in Harmony Square installation completed by mid-2020. “This is truly a milestone for Inter1741 Virginia Ave., Suite C, Harrisonburg, VA Change,” Anders said. “This project has been a dream for us for many years.”

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Wednesday, September 25, 2019

SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Not Too Soon For Some End-Of-Year Financial Moves We’ve still got a couple of months until 2019 draws to a close, but it’s not too early to make some end-of-the-year financial moves. In fact, it may be a good idea to take some of these steps sooner rather than later. Here are a few suggestions: Boost your 401(k) contributions. Like many people, you might not usually contribute the maximum amount to your 401(k), which, in Kathy Armentrout 2019 is $19,000, or $25,000 if you’re 50 or older. Ask your employer if you can increase your 401(k) contributions in 2019, and if you receive a bonus before the year ends, you may time as any. But don’t make any judgments taking withdrawals – the technical term be able to use that toward your 401(k), too. based solely on your results over the past 10 is “required minimum distributions,” or months. Instead, look carefully at how your RMDs – from your traditional IRA and your Add to your IRA. You have until April 15, portfolio is constructed. Is it still properly 401(k) or similar plan. After the first year in 2020, to contribute to your IRA for the 2019 diversified, or has it become overweighted which you take these RMDs, you must take tax year, but the more you can put in now in some areas? Does it still fit your risk them by the end of each year thereafter. If and over the next few months, the less you’ll tolerance, or do you find yourself worrying you don’t withdraw at least the minimum have to come up with in a hurry at the filing excessively about short-term price swings? amount (calculated based on your age, acdeadline. For 2019, you can put up to $6,000 These are the types of factors that might count balance and other factors) you face lead you to make some changes, possibly a penalty of 50% of what you should have in your IRA, or $7,000 if you’re 50 or older. with the help of a financial professional. taken out – a potential loss of thousands of dollars. So, take your RMDs before Dec. Review your portfolio. It’s always a Don’t forget about your RMDs. Once 31. The financial services provider that adgood idea to review your investment portfolio at least once a year, and now is as good a you turn 70½, you generally need to start ministers your IRA or 401(k) can help you

Financial Focus

determine the amount you must withdraw. Think about next year’s opportunities. It happens to almost all of us: A year has passed, and we haven’t taken the actions we had planned. So, start thinking now about what you want to do in 2020 from a financial standpoint. Can you afford to ratchet up your investments in your retirement plans? If you have children or grandchildren, have you started saving for college? Have you considered ways to protect your financial independence if you ever need some type of long-term care, such as an extended nursing home stay? If these or other items are on your financial to-do list, start planning now to get them done next year. Time goes quickly – so don’t get left behind without having taken the steps to keep moving toward your financial goals This article was written by Edward Jones for use by Kathy Armentrout, an Edward Jones financial adviser at 560 Neff Ave., Suite 100, Harrisonburg; 540-5741013.


Harrisonburg, Va.

Tourism 

FROM PAGE 3

revenue raised from taxes through tourism in 2018, French said. Rockingham collected over $6 million, while Shenandoah brought in more than $6.6 million in taxes related to the tourism industry. “We were really proud to see strong growth in that area because, of course, the reason we do what we do is to diversify tax revenues for the county,” French said. Many tourists are drawn to the Valley by the natural attractions like the Shenandoah River, George Washington National Forest, Shenandoah National Park and Luray Caverns. It’s not just the sights that draw people, but the hiking, canoeing and adventure opportunities that populate the region. “I think, definitely for our region, we’re starting to realize how much of an outdoor recreation center the Shenandoah Valley is,” Gooden said. The differences between the localities help to draw tourists into the region, said Liz Lewis, economic development and tourism coordinator for Page County. “Each of us contribute to different demographics that travels to the Shenandoah Valley,” Lewis said. Page County’s separation from Interstate 81 is both an advantage and disadvantage for the locality, she said. “It’s bad for manufacturing, but it’s great for tourism,” Lewis said. Lewis said the distance from I-81 helps tourists to feel as if they are really getting away from it all. One of the tourism trends Page County is looking to capitalize on is camping, especially among millenials who are increasingly pitching tents, according to Lewis. An expensive new hotel isn’t the only way to add lodging to a locality’s reve-

nue stream, Lewis said. “Page County is proposing a bike park on the landfill in Stanley that’s been closed for several years and adding a camping element to that brings lodging into the town of Stanley,” she said. There are two main tourism initiatives Shenandoah County is working on, French said. One is working with landowners, public and private, to expand access to the Shenandoah River. The other is turning the entire county into a “tourism zone,” which would create incentives for tourism-related businesses, such as breweries. The zone is based on models used in Front Royal and Waynesboro, French said. It is supported by the Virginia Tourism Corp., a state body tasked with growing tourism in the Commonwealth. Including the whole county was important to

SHENANDOAH VALLEY BUSINESS JOURNAL crafting the zone, she said. “We worried that if we limited the zone just to the towns or specific areas, we would really miss out on some opportunities in the growing agritourism market that we’ve seen,” French said. The Shenandoah County Board of Supervisors would have to support the motion before it would take effect. French said she estimates the economic development and tourism office to be able to present the plan to the supervisors this year or in early 2020. Ongoing Rockingham County projects include making a tourism video for digital campaigns and a combined guidebook with the city, Gooden said. “We always say visitors don’t see boundaries,” French said. Contact Ian Munro at 574-6278 or imunro@dnronline.com. Follow Ian on Twitter @IanMunroDNR

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SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg Brothers Bet On Hemp

Harrisonburg, Va.

JMU Lab Helping With Crop Analysis

By IAN MUNRO

Daily News-Record

HARRISONBURG — Jake, Abner and Tanner Johnson, of Harrisonburg, do most things brothers do together, and they’re doing something that very few across the Commonwealth are — growing hemp. Jake Johnson, 26, and Abner Johnson, 22, first had the idea to start the business three years ago and now, they’re growing hemp for CBD oil on a 1-acre plot and a 2,500-square-foot greenhouse in Weyers Cave. “We’re very passionate about the cannabis plant and when we saw the opportunity to grow hemp, we hopped on board,” Jake Johnson said. Their company is called Shenandoah Valley Hemp, and was born out of changes in the 2016 Farm Bill and ensuing Virginia state law that allowed hemp to be grown for commercial purposes. Previously, hemp could only be grown for research through institutes of higher education. Jake Johnson, a James Madison University graduate, spent time on various cannabis farms in Portland, Oregon, during a JMU internship. That’s where he first learned about what it takes to run a hemp business. The oldest Johnson brother, Tanner, 27, joined the business this year. Most hemp growers produce for fiber, whereas the Johnson brothers are growing for CBD oil. As Abner looked into research, he noticed something that would prove a major obstacle. “I realized they were conducting experiments completely different,” he said. Since hemp is still in its first publicly legal growing season across the Commonwealth, there is still quite a bit of research to be done on best practices, Abner Johnson said. The brothers’ results from growing hemp for CBD oil production in Virginia are based on their own findings versus best practice resources, because there are very few practice resources for growing hemp for CBD, he said. However, there is still help.

Courtesy Photo

The Johnson brothers Jake, 26, Tanner, 27, and Abner, 22, inspect a hemp plant to be used for CBD oil at their operation in Weyers Cave. Daniel Downey, a JMU chemistry professor, has taken the brothers’ hemp for research, along with products from several other hemp farmers. “We’re analyzing their plant as they are growing them and then we’ll give them feedback on what seems to be working,” Downey said. Hemp needs to be watched closely over the late summer, as that’s when the THC percentage starts to rise, he said. In Virginia, if the THC percentage in hemp rises above 5%, the product is destroyed. “Compliance with the law is our

first priority here,” Abner Johnson said. To avoid this risk farmers can visit licensed testers, but that often comes at a hefty price. The JMU inspection is free as the lab is getting valuable research materials from the farmer, Downey said. “Farmers plant a crop, but they don’t walk away from it — and hemp’s no different,” he said. Downey was a neighbor of the Johnson brothers when they were young, and met them again by chance in May as he was taking a chemistry field work class on a tour of the farm site.

“It was kind of serendipity from the standpoint that we weren’t there for hemp,” he said. The lab’s ability to help hemp farmers will only grow, according to Downey. “We’re just getting fired up this year,” he said. As for the Johnson brothers, they are already looking at building onto their business with a processing facility, allowing them to make CBD from their raw hemp as well as other farmers’ hemp. There are two kinds of hemp processing which use ethanol of carbon dioxide to produce CBD oil, Abner

Johnson said. Carbon dioxide processing “uses no solvents and comes out as very pure product that never was used with any of those other products or solvents that could be harmful,” he said. Right now, the brothers are looking at leasing and retrofitting a space around Dayton. “Researched processing is definitely going to be the next new wave,” Tanner Johnson said. Contact Ian Munro at 574-6278 or imunro@dnronline.com. Follow Ian on Twitter @IanMunroDNR


SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Wednesday, September 25, 2019

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A Culture Of Trust Within The Workplace Trust is the key ingredient of a healthy workplace culture, and trust is a huge predictor of the success of the leadership of any business. When your team trusts you and each other, everything works better. That’s why it is important to develop a culture of trust in your business. We are wired to want to trust others, and we are disappointed when people fail to live up to those expectations. When trust is absent, everything becomes more difficult. Building trust will be key in moving your business forward. Your trustworthiness will be the most important aspect of your leadership. But first, you have to demonstrate that you are trustworthy. You have to earn the right to be trusted. Here are five B’s necessary for building a culture of trust.

1. Building Up Your Team

Trust your employees enough to consider their requests and ideas to improve the company. As a result, you will build your team’s confidence in themselves. Empower your team members to make decisions that affect what they do. They know how to do their job better than you do, so encourage them to make decisions in their area of expertise. Giving your team the ability to “own” what they do will produce better results and will demonstrate that you trust them. It is up to you to help them feel empowered enough to do what they think will best advance the company and best serve the customer. The empowerment process will enable them to have an ownership mentality. They will see how they are active contributors. They will realize that they have something to offer because you are willing to listen to what they have to say.

Leadership Robert McFarland you can inspire confidence in your lead- may be surprised how much that extenership ability. sion of trust can transform your team. When you believe in your employees, they will want to show you that you have 3. Being Fair Your organization will benefit the most made a good decision in giving them your when you seek to create a culture of trust. trust. They will want to perform to your Everything you do as a leader should be fo- expectations to show you that you can cused on fostering an environment of trust. continue to extend your trust to them. The belief that you have in them will be And fairness is crucial. Your employees will be extremely sen- reciprocated as well. They will end up sitized to what they deem to be fair. If you believing more in you and in your leadplay favorites, you will not develop an envi- ership too. As a leader, you will build a culture of ronment that is perceived as fair, and it will trust by believing in and building up your not encourage trust on your team. Your workplace is looking for you to provide a place where everyone can contribute to the organization. You can create a workplace culture that is beneficial to everyone by treating your team with the same fairness with which you would want to be treated.

4. Being Loyal

If you remain loyal to your team when they fail, they will develop an unswerving loyalty to you. They need to know that you will defend them if they try new things. Innovation happens when people feel free enough to exercise their good judgment without fear of reprisal. When you allow your team to fail, you will encourage your team to take initiative. Trust your people and trust their judg2. Becoming A Learner To be the leader, you don’t need to look ment. Your team will fail. Your team will like the smartest person in the room. In- learn. As a result, your team will grow. stead you need to be the person who is always learning. 5. Believing In Your Team You might think that admitting what Trust is a powerful motivator. Choose you don’t know exposes you as being vul- to believe the best about your employnerable. Actually, that vulnerability will ees. Tell them that you trust them. Then endear you to your team because they will demonstrate that you trust them. know you are telling them the truth. Your team wants to do good work. Let By admitting that you don’t know ev- your team know you believe in them. Let erything, they will respect your leadership them know that you are counting on them. all the more. The more humility you ex- Let them know that you fully believe in hibit as a leader to your team, the more the quality of the work they can do. You

When you believe in your employees, they will want to show you that you have made a good decision in giving them your trust. team, by being fair and loyal, and by becoming a continuous learner. In the process, you will transform your workplace — and that will transform you. Robert McFarland is the author of the bestsellers, Dear Boss: What Your Employees Wish You Knew and Dear Employee: What Your Boss Wishes You Knew. Robert is also President of Transformational Impact LLC, a leadership development consultancy helping companies improve their employee cultures to make the companies healthier, more productive, and more profitable.


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Wednesday, September 25, 2019

SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Associated Press

Visitors walk the stairs to Alexander Hall on the campus of Geneva College in Beaver Falls, Pa., on July 13. Whether it’s money for books, living expenses or something else, students starting the new school year may quickly realize their financial aid won’t cover all the costs of college.

4 Ways To Cover College If Financial Aid Isn’t Enough By RYAN LANE

NerdWallet via AP

For 61% of students, college costs more than they expected, according to a recent survey from College Ave Student Loans conducted by Barnes & Noble College Insights. Yoselin Guzman, an 18-yearold UCLA freshman from Compton, California, can see why. “There’s like little costs you don’t even see,” says Guzman, noting how expensive dorm items, books and student orientation are. When those unexpected costs arise — and your existing financial aid won’t cut it — here are

four options to get more money 100,000 education-related camfor school. paigns each year, though not all are for college tuition and success varies. 1. Crowdfund The Shortfall “We’ve seen an increase in When Guzman realized her savings and scholarships wouldn’t crowdsourcing as an option for cover her college expenses, she covering college costs,” says Brad started a GoFundMe campaign to Lindberg, assistant vice president for enrollment at Grinnell College crowdfund $5,000. “I was a little embarrassed to in Grinnell, Iowa. But Lindberg cautions students show people I’m struggling finanto work with their school’s financially,” Guzman says. Getting over those fears helped cial aid office before starting a cover her funding gap. Now, she campaign. The additional funding says the donations have “given me might affect future aid eligibility, that confidence that I’m not alone he says. in this world.” She’s certainly not alone on Go- 2. Increase Your Work Schedule FundMe: The website hosts over GoFundMe allows students to

keep any funds they receive, even if they fall short of their overall goal. But there’s no guarantee you’ll get any money. Working, though, is a surefire way to do that. If you’re eligible for a workstudy job, that’s typically the best option. “Your supervisor is a built-in mentor; they understand you are a student first (and there’s) flexibility in scheduling,” says Ashley Bianchi, director of financial aid at Williams College in Williamstown, Massachusetts. If you already have a job, consider working more hours. That may be tricky with work-study po-

sitions, since earnings are capped at a specific amount, so look off campus or on a college student-focused job board. Just be careful not to overextend yourself. Bianchi says her college recommends students work six to seven hours a week; Lindberg puts 10 hours as a reasonable amount. But some students may be able to handle more based on their schedules and activities.

3. Check Emergency Aid Programs

Many schools offer emergency financial assistance. For example,

See COLLEGE, Page 14


SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Wednesday, September 25, 2019

13

Valley Company Buys City Plant Packager Looks To Expand Local Sales By IAN MUNRO

Daily News-Record

HARRISONBURG — Artisan Packaging purchased the Graham Packaging plastics plant on West Wolfe Street in Harrisonburg in an approximately $5.3 million deal completed on Aug. 29, said Jay Veenis, an owner of Artisan Packaging. The sale includes the land, the building, as well as all of the equipment and assets of the facility. Artisan Packaging will pursue new sales and marketing leads in the pharmaceutical, personal care and several food industries, according to Veenis. “We’re no longer part of a large company so [the plant] can be much more nimble and quick to respond without having the corporate overhead,” he said. Veenis has been the plant manager at the Harrisonburg factory for five years and has over 25 years of experience in the packaging industry, including with CCL Industries and Interpack. Veenis, the primary owner of Artisan Packaging, and other investors bid on the factory after it was available for sale. The other owners of Artisan Packaging are silent investors, which means they will not interfere with day-today operations at the plant. Employees of the Graham Packaging plant in Harrisonburg received a Worker Adjustment and Retraining Notification on June 24 stating that the

Mayor Richard Orndorff Jr., right, and Vice Mayor Scott Terndrup, center, listen as Councilman John Massoud speaks at a Sept. 16 work session.

We’re no longer part of a large company so [the plant] can be much more nimble and quick to respond without having the corporate overhead. n Jay Veenis,

owner, Artisan Packaging factory would close and layoff all employees on Sept. 4. Artisan Packaging will not only retain all the plant’s employees, but will also be looking to hire about 15 more people, Veenis said. Artisan Packaging has to fill some office and production positions. “Everyone here in the plant and all the employees are very excited,” Veenis said. “Motivation is high and the morale is high.” The plant’s customers include blue-chip companies such as Johnson & Johnson, Procter & Gamble, L’Oreal and Cao. The Graham Packaging sign will be replaced by an Artisan Packaging sign in the coming weeks. Graham Packaging did not return media inquires by press time. Contact Ian Munro at 574-6278 or imunro@dnronline.com. Follow Ian on Twitter @IanMunroDNR

Josette Keelor / For the DN-R

Strasburg To Pursue LFCC Connection In Transit Grant By JOSETTE KEELOR

For the Daily News-Record

STRASBURG — Town Council members are looking for answers on possible public transit routes that would take residents outside of Shenandoah County. Until the council can ask questions of the Northern Shenandoah Valley Regional Commission, which is heading the effort to introduce public bus routes within the county, council members have chosen to table any lengthy discussions on the matter. Calling for an informal vote among members at a Sept. 16 work session, Mayor Richard Orndorff Jr. said there was no point in taking up time at a future work session if council members planned to reiterate points already made. The board was split in the informal show of hands, with Ken Cherrix, John Massoud and Kim Bishop largely opposed to all public transport options proposed so far, and Jocelyn Vena joining their position only if a route to Lord Fairfax Community College in Middletown were not included. Councilwoman Taralyn Nich-

olson was absent. The council also wants to know if program resources could be allocated to areas of the county that are found to have a greater need — for example, assigning more buses along the northern loop if it turns out it consistently has more passengers. Town Manager Wyatt Pearson said he would take the council’s questions to the regional commission before discussions in Strasburg proceed. The council will revisit the discussion briefly at its Oct. 1 work session. “If we move forward, it’s with LFCC,” Orndorff said. The current suggestion by the regional commission is a countywide public bus route from 6 a.m. to 6 p.m. Monday through Saturday. The route will have a southern loop traveling between New Market and Woodstock, and a northern loop between Woodstock and Strasburg. The commission has already been considering a third, pricier option of a connection bus from Strasburg to LFCC. Since the transportation project is headed by the commission, the county and its towns would be low-cost par-

ticipants in an 18-month test study that will introduce bus routes to the county and collect data on passenger usage. The study would be funded in large part by a demonstration grant, using federal and state funds, contributions by business partners and small additions from the county and its six incorporated towns: Strasburg, Toms Brook, Woodstock, Edinburg, Mount Jackson and New Market. But Massoud said he isn’t sure he would support Strasburg continuing with the effort after the 18-month trial, even if it does prove to be moderately successful. “My concern is that we’re not being flexible enough,” he told other council members. “It doesn’t seem to me this is going to be very flexible.” Listing his main concerns about time people will have to spend waiting for bus pickups, especially in bad weather before shelters can be built, he suggested the project seemed like it would add more problems than it would solve. The project seeks to aid people who

See TRANSIT, Page 15


14

Wednesday, September 25, 2019

College 

FROM PAGE 12

the University of California, Davis, has emergency grants that don’t require repayment. It also offers short-term loans that range from $500 to $1,500. Always opt for grants first, and know the costs of any loan before borrowing. Leslie Kemp, director of the Aggie Compass Basic Needs Center at UC Davis, also encourages students facing financial shortfalls to think long-term. “What’s your plan when the $500 runs out?” she says. One solution is to use free resources that make other expenses, like groceries, more manageable. Kemp says there’s a line out the door when her school’s food pantry opens. If you can’t find similar services on your campus, Kemp says to look for help at religious organizations, food banks and other nonprofit groups.

4. Borrow Student Loans

Money you don’t repay — like donations, wages and emergency grants — is the best way to address unexpected college costs. But student loans may be a necessity for some: Among the 61% of students sur-

SHENANDOAH VALLEY BUSINESS JOURNAL prised by the cost of college, 30% underestimated what they needed by $10,000 or more. “If you’re short by enough that there’s a comma in the number, you might need to borrow,” says Joe DePaulo, CEO and co-founder of College Ave Student Loans. That assumes you haven’t already reached your borrowing maximum. The government limits the amount of federal loans you can receive. Most firstyear students can take out up to $5,500 in their name, and no one can borrow more than their school’s cost of attendance, the total needed for tuition, fees, room and board and other expenses. Visit your school’s financial aid office to discuss your options — especially if your financial situation has changed since you started school. “It’s important to work through why the student is experiencing a shortfall in order to determine the best course of action,” Lindberg says. That action may be borrowing, or it could be something else like starting a tuition payment plan or earning an outside scholarship. Ultimately, the financial aid office should be your first stop if you run into trouble.

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Wednesday, September 25, 2019

15

Firm Plans To Open Distribution Center Near Inland Port Would Create 50-100 Jobs By JOSH GULLY

For the Daily News-Record

FRONT ROYAL — EQUUS Capital Partners, a private equity firm, hopes to open a 324,000-square-foot logistics center that will provide an estimated 50-100 jobs off Winchester Road. Dan DiLella Jr., EQUUS’ senior vice president, explained over the phone that a logistics center “is a fancy name for a warehouse distribution center” that stores goods and products. He said the facility’s potential customers will likely be users of the Virginia Inland Port. DiLella said the facility’s proposed site, which is 0.5 miles from the port, is an ideal location. He explained that when companies have items arrive at the port via train, the goods can be offloaded and stored in the facility until they are ready to be delivered to their ultimate destination. For example, he noted that Family Dollar receives overseas shipments through water ports in Hampton Roads. From there, he said, those containers can be taken by train to the Virginia Inland Port and then eventually to a local distribution facility. County Administrator Doug Stanley stated in an email that “the project capi-

Transit 

FROM PAGE 13

can’t drive themselves to work, appointments, stores and community activities, mainly seniors and teens, the disabled, those who can’t afford a car, and those who for other reasons don’t drive. However, Massoud argued that many people who need rides might not have access to the public bus system. Those who live too far from bus stops to walk will still need to catch a ride there, he said. People who take the bus someplace may need to wait awhile for a ride home, and in the meantime, depending on age, ability, distance and weather conditions, might not be able to walk anyplace else while waiting. Furthermore, he said, in a county as rural and large as Shenandoah (with about 30 miles between Strasburg and New Market and a total

talizes on what makes Warren County attractive for economic development,” noting the Inland Port’s proximity to interstates 81 and 66. He added that the project “is exciting because it is the first major industrial project we have seen in the corridor since the Baugh Northeast project” in 2005. Before work on the project begins, the property must be rezoned from agricultural to industrial and granted a conditional use permit for a building over 50,000 square feet to be located in the area. A 7 p.m. Oct. 9 Planning Commission public hearing is scheduled for the rezoning and conditional use permit. The matter then goes before the Board of Supervisors, which will approve or deny the commission’s recommendation. Located at 6475 Winchester Road, the 20 acres of land on which the facility will be built is just north of the Rappahannock-Shenandoah-Warren Regional jail and is owned by Betty Blanchard. DiLella said EQUUS has a contract to purchase the land but declined to say for how much. He explained the firm is guiding the site through the rezoning process and will likely take over the land when that is complete. Stanley stated that while the project must go through the planning process, “it is proposed in the heart of the corridor in an area that has been designated by the county’s com-

area of 512 miles), he’s doubtful that a public bus system will even be that successful — at least not for years to come. He stressed that his experience working in transportation for 35 years in Northern Virginia has given him perspective on the subject and that he doesn’t think people will embrace a two-hour bus circuit that only fits 14 people from one stop to the next. And that’s assuming anyone rides the bus at all, he said. For county residents, he said, “It’s going to take them many years to think ‘bus first’ as a viable option.” Orndorff and Councilwoman Emily Reynolds offered alternative arguments. Orndorff recalled a town resident who called him multiple times in 2016 wondering how she would get to her doctors’ appointments in Woodstock when

It takes trucks off the highway and certainly provides additional volume for us, which means creating jobs directly through the port and indirectly through the logistics community that exists here in the Shenandoah Valley region. n Lee Cranford, Inland Port’s terminal operations manager

prehensive plan for industrial development.” DiLella said the rezoning process should be accomplished by the first quarter of 2020 and construction should hopefully be completed by the end of the year. Although he is not sure of an exact figure, he estimated that construction, which will be privately funded by the firm, will cost around $20 million. He said the advantages the warehouse will bring to the community include the amount of real estate tax that will be paid on the building and the addition of somewhere between 50 and 100 jobs. Lee Cranford, the Inland Port’s terminal operations manager, said over the phone that “there’s a potential” that the facility will have a positive impact on the port. He said that all depends on who uses the facility and if they are port customers. DiLella said that while the firm is open to talking to anyone who wants to use the facil-

she didn’t have a ride. Saying she would spend $15 to $20 in taxi fees every time she traveled to Woodstock, she requested that Orndorff pursue options of public transportation. Representatives from the regional commission have estimated bus fares in the 18-month trial at $1 or so each way. Reynolds recalled her experience living in town without a car from 2010-12, when she relied on friends to drive her everywhere. “If I had had this service, I absolutely would have used it,” she said. Also disabled for a short time, she recalled, “I would have waited” for a bus. She said that mothers with young children are a likely group to use public transport. “They know what it’s like to wait,” Reynolds said. “They will appreciate the service as it is. Because the alternative is not having a ride.”

ity, he believes the customers will ultimately be those who use the Virginia Inland Port. He added that the facility’s location will allow companies to take advantage of quick transportation from the port and save money because “you just can’t get any closer than that.” Cranford said the port would like to see such a facility “as close to us as possible” and that the warehouse “definitely has the opportunity to be very positively impactful.” “It takes trucks off the highway and certainly provides additional volume for us, which means creating jobs directly through the port and indirectly through the logistics community that exists here in the Shenandoah Valley region,” Cranford said. Stanley noted that the Winners Court access road is already in place to provide truck access to the facility, which will minimize traffic impacts on Winchester Road.

Councilwoman Barbara Plitt said she could see parents using the service to cut down on the number of times they need to drive their teens to and from events and activities. Strasburg, which Pearson said is one of the first towns to discuss this in a work session so far, would be looking at spending $16,220 on its participation in the 18-month demonstration, which is less than previous estimates said. If a route to LFCC is added, the town is looking at about $21,000. The total cost of the proposed project is expected to be $673,000, Pearson said. Federal and state funds would cover all but $118,000. Bus shelters will be added later if the demonstration study is successful and if the county and towns decide to pursue the project. Massoud said he was more intent on including the route to LFCC after Pearson said it would open Stras-

burg up to an existing connection between LFCC and Front Royal. Cherrix said he wouldn’t be “as Scroogy” about the transportation project if it included LFCC as an option to at least bring the possibility of more funding to the project. “I wonder,” said Vice Mayor Scott Terndrup, “if this doesn’t work out, if there’s a loop we can work with the Front Royal system that would go from here to LFCC and then here to Front Royal.” That would also link Strasburg into an existing bus route that connects Front Royal to Washington, D.C., he said. That would be more expensive, Pearson pointed out. “That would just be us,” Orndorff agreed. Attending the meeting were Reynolds, Bishop, Cherrix, Massoud, Vena, Terndrup, Plitt, Orndorff and Pearson. Nicholson was absent.


16

Wednesday, September 25, 2019

SHENANDOAH VALLEY BUSINESS JOURNAL

Harrisonburg, Va.

Profile for Daily News-Record

Shenandoah Valley Business Journal - September 2019  

Shenandoah Valley Business Journal - September 2019  

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