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BUILDING LEGENDS Legends of real estate honored by local CCIM chapter PAGE 4

YYour our Weekly Weekly Business Journal for the Tucson M Metro Area WWW.INSIDETUCSONBUSINESS.COM WW W WW. W.IIN NSIDETUC CS C SO ON NBU BUS SIINE NES ES SS S.C . OM • FEB FEBRUARY BR RU UARY 22, 2013 • VOL. 22, NO. 39 • $1

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Incentives for cinema State lawmakers want new Incentives for TV and film industry

City struggles with rising retirement costs

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An increase in speculation

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“Spec” home inventory jumped in January Page 19

PENSION

PREDICAMENT

Grand Canyon University looks to Tucson for possible new campus By Patrick McNamara Inside Tucson Business Phoenix-based Grand Canyon University has plans to build a new campus and Tucson is on the short list of locations. The new campus would ultimately serve up to 7,000 students and have as many as 2,000 employees. “We’re just trying to determine where we’re going to take our first step,” said Bill Jenkins, spokesman for Grand Canyon University. Jenkins said the university had first sought to expand into the Phoenix metro area’s East Valley, which includes the communities of Chandler, Mesa, Scottsdale, Tempe, Ahwatukee and Gilbert. School officials issued a request for proposals to get a sense of what the communities could offer the proposed expansion campus. When word reached Tucson that Grand Can-

yon was looking for a new site, Tucson Regional Economic Opportunities President and CEO Joe Snell and a group of close to 20 government and private industry leaders from the region went to meet with university officials. “We are very confident that we have a regional plan that will be compelling to them,” Snell said. The group has put together a proposal that shows numerous locations in the Tucson region that would meet the university’s site requirements. “We were very impressed,” Jenkins said. Jenkins said the university would look for a site of about 75 to 100 acres that could accommodate four campus buildings for classrooms, a recreation center and food services. There are no plans for student housing. Snell said a TREO analysis estimates the economic impact of the campus could be as much as $1.6 billion. “That’s as much as Ventana Medical

Systems,” he said. Grand Canyon University plans to break ground on the campus by this summer and start classes in fall 2014. The campus also could qualify for incentives offered by the Arizona Commerce Authority. Grand Canyon University, founded in 1949, is a private, Christian university accredited for undergraduate and graduate degrees by the Higher Learning Commission. More than 7,000 students study at the university’s Phoenix campus and more than 40,000 take classes online. Jenkins said that the search of a new campus, which at one time included Albuquerque and Las Vegas, is now down to just two possibilities; either Tucson or the East Valley.

Contact reporter Patrick McNamara at pmcnamara@azbiz.com or (520) 295-4259.


2 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

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InsideTucsonBusiness.com

FEBRUARY 22, 2013

3

NEWS

City faces unfunded pension plan to the tune of $343.8M In millions

$25.3M land default at Rancho Vistoso Three large vacant parcels in Oro Valley’s Rancho Vistoso master-planned community have fallen into foreclosure on notes totaling $25.3 million and will be sold at public auction in April. The owner is Vistoso Partners LLC, Phoenix. Vistoso Partners lists as it owners Ashton Wolfswinkel and Brandon Wolfswinkel, part of the Wolfsfwinkel Group that originally developed the area. Other investor-owners, all based in the Phoenix area, are J-Cor Inc., Robinson Farms Inc., and Gillespie Properties Inc., according to public records. The parcels consist of 988.6 acres northeast of Rancho Vistoso Boulevard and Tangerine Road; 48.5 acres on the northeast corner of Rancho Vistoso Booulevard and Moore Road; and 26.5 acres east of La Canada and Desert Fairways drives. The beneficiary is ML Servicing Co., Peoria. The public auction is being handled by the law firm of Gust Rosenfeld. It will be held at 11 a.m. April 30 at the firm’s office at 1 S. Church Ave., Suite 1900.

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By Patrick McNamara Inside Tucson Business Years of a down economy, hiring freezes and increased retirements have left public pension systems in shambles — and the City of Tucson is a prime example. “It’s a huge problem,” said City Councilman Paul Cunningham. Cunningham said the city needs to act to stave the tide of rising pension-fund liabilities as more city employees approach retirement age.

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More than 2,300 former city cit employemplo ees draw a pension from the city’s Tucson Supplemental Retirement System (TSRS) for non-public safety workers, while 2,700 current employees pay into the fund, according to city financial reports. But of those 2,700 active employees, more than 75 percent are older than 40 years old and more will head into retirement in coming years. A discussion of the city’s pension plans has been scheduled for Tuesday’s (Feb. 26) city council meeting.

The problems the city with its penbl th it faces f ith it sions reflects what has happened to many publicly funded retirement plans across the country — fewer employees paying into the funds while investments yield lower profits, the result of the multi-year recession. In the case of Tucson, the unfunded share of the TSRS has grown to more than $343.8 million from $128.7 million at the end of fiscal 2007. The funded portion of the TSRS has simi-

PENSIONS PAGE 6

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Doug Hockstad, former associate director of software and engineering licensing at the University of Michigan Office of Technology Transfer, has been named the new director of the Office of Technology Transfer at the University of Arizona. Hockstad has more than 20 years of product management, marketing and sales experience in high-tech markets, predominantly with software companies. For 11 years at Michigan, he built its software licensing portfolio program, managed software and other copyright-related intellectual property, and was a member of the executive management team. “The University of Michigan is an excellent example of a university that did a turnaround in technology transfer and Doug was there from the beginning and a high-level participant,” said Tech Launch Arizona executive director David Allen. The Office of Technology Transfer, an affiliate of Tech Launch Arizona, helps to manage the commercialization of technologies at the UA.

EDITION INDEX Public Notices Lists Inside Media Briefs Meals and Entertainment Arts and Culture

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4 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

NEWS Office Depot to acquire OfficeMax, close stores Office supply retailer Office Depot will acquire its smaller rival OfficeMax in a $976 million all-stock deal announced Wednesday (Feb. 20). A deal had been leaked earlier in the week and despite the official announcement, the companies said it still hasn’t been determined what the combined entity’s name will be, where its headquarters will be or who its CEO will be. It is widely believed that the merger will result in some store closures, quite possibly in Tucson one of the few markets in which both companies currently have stores along with their other big rival, Staples. Office Depot has three stores in the Tucson market, but none in the Phoenix area. OfficeMax has eight stores in the Tucson region. Staples has three stores in the Tucson market.

Herder and Marshall are honored as real estate legends

Arizona State University President Michael Crow says up to 10,000 people will need to be hired in the next years to support ASU’s ambitious research goals. Crow told the Phoenix business Journal he plans to increase ASU’s research expenditures to $700 million within the next six or seven years, up from an existing $386 million. The majority of that funding comes from federal research grants, but Crow wants to look at growing other funding opportunities, including business partnerships both in Arizona and beyond. Currently, ASU has nearly 20,000 people involved in the university’s research enterprise, including students, faculty and scientists. To get to Crow’s goal of $700 million in research funding, he said he will need more than 40,000 people involved in the school’s research activity. To get there, Crow said he would need to hire between 5,000 and 10,000 more employees.

Tucson gas prices jump 12½¢ in 1 week Gas prices are accelerating upward at a rapid rate, with the price in Tucson this week for regular averaging $3.36 per gallon, up 12½ cents per gallon in just one week, according to AAA Arizona’s Weekly Fuel Gauge survey. The price has been steadily increasing since it fell to below $3 per gallon at the first of the year. The average price has now topped $4 per gallon in two states, Hawaii and California, and is within 10 cents per gallon of that mark for nearly one-third of the population of the U.S.

Otis Blank photo

Crow has big plans to grow ASU research

Honoree Pete Herder, left, and CCIM president Dave Blanchette.

By Roger Yohem Inside Tucson Business More than 90 years ago, Louise Foucar Marshall developed Tucson’s first “suburban” shopping center next to the University of Arizona. The college professor-turneddeveloper also acquired apartments and ironically, as Tucson is building Sun Link, shares in a failed 1902 streetcar venture that was to link the campus with downtown. Her business acumen and philanthropy grew to the point that she established the Marshall Charitable Foundation in 1930. “I have the greatest job in the world, to carry forward Mrs. Marshall’s legacy because real estate people who give their money away have a different mentality than those who sell their buildings after five years. It’s a totally different type of climate to work in, a marvelous experience,” said Jane McCollum, general manager of the foundation. Marshall and developer Pete Herder, owner of the Herder Companies, were honored as Legends of Real Estate by the Certified Commercial Investment Member (CCIM) Southern Arizona Chapter on Feb. 12. In 1900, Marshall became the first woman professor at the UA and was later named chair of the Language Department. In 1904, she married Thomas Marshall and resigned her professorships to concentrate on real estate. In 1922, she developed Tucson’s first suburban shopping center, today known as Main Gate Square on University Boulevard. It is “the centerpiece of her legacy,” said McCollum, with more than 350,000 square feet of retail and office space, and the Marriott Tucson

University Park Hotel, 880 E. Second St. Marshall died in 1956 with no heirs and left most of her wealth to her foundation. Led today by a board of directors, McCollum accepted the award on its behalf. The foundation donates 5 percent of its net worth annually to UA scholarships and other local causes, gifts that total more than $18 million. “She was a savvy business woman. She left a legacy that continues to this day,” said McCollum. “She is a perfect person to be honored as a legend in real estate.” Herder, a third-generation builder, made his way to Tucson in the 1960s at the urging of friend Fred Fickett. (Fickett Middle School, part of Booth Fickett Magnet School, is named after him.) While at a Rose Bowl game in California, Fickett told Herder that Tucson would be a great place for him to work and live. “That’s how we came here from Denver and it’s been a wonderful experience with a lot of wonderful people. And I do like the warm weather,” laughed Herder. Herder built his first house in Flecha Caida in the Catalina Foothills off Swan Road north of River Road. “John Bender, a legend in his own right, sold me a lot for $5,000 at no interest. He said I could pay him when I sold the home. That’s how I got started,” Herder said. That house sold for $36,500 and Herder built 50 other homes in the area. Bender, who with Leonard Savage also developed Skyline Country Club, made the same deal there with Herder who built 40 homes in that area at the north end of Swan Road. Herder has built more than 5,000 homes in the Tucson region and about 20,000 homes in Arizona,

Colorado and California. His first office project was a small building across from El Con Mall on East Broadway for Catalina Savings and Loan. His favorite commercial development is St. Philip’s Plaza at the southeast corner of Campbell Avenue and River Road. He also developed Butterfield Business Park, north of Valencia Road between Palo Verde Road and Alvernon Way near Tucson International Airport, and “about 35 of those traditional gray, slump-block buildings you see all over town.” Herder’s influence reaches far beyond Arizona. He was president of the National Association of Home Builders (NAHB), based in Washington, D.C., and a member of President Ronald Reagan’s Commission on Housing. As head of NAHB, he also worked to develop construction management programs in 24 universities across the country. “That was one of my favorite things at NAHB. In a way, it was an extension of my love of coaching football and wrestling. I’ve always enjoyed working with young people,” said Herder, who coached those two sports after college. Over the decades, Herder worked with several U.S. presidents on housing issues. Reagan was his favorite. “The reason is his character,” Herder said. “The first time I met him, he looked me straight in the eye, never looked over my shoulder to see who else was in the room.”

Contact Roger Yohem at ryohem@ azbiz.com or (520) 295-4254.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

5

NEWS

New bill tries to revive film production incentives

This Week’s

Good News Good news plea One of Tucson’s biggest annual events, the World Golf Championships - Accenture Match Play Championship saw its first round snowed out this week. The good news is, it was a freak storm. Come on guys, really. The weather is great this weekend. We’ll go out and watch the play. Promise. Please come back.

The Tucson

INSIDER Insights and trends on developing and ongoing Tucson regional business news.

File photo

Rosemont moves on

Lobbyist Barry Aarons, left, and Tucson Film Office director Shelli Hall at a community event on film industry incentives last summer.

By Patrick McNamara Inside Tucson Business State lawmakers and advocates for a film industry incentive program have put together a new proposal that has begun to gain traction in the Legislature. “This is essentially a jobs bill,” said Shelli Hall, director of the Tucson Film Office. Hall said the proposed incentives plan (SB 1242), would help to attract major Hollywood studio productions to Southern Arizona and the rest of the state and help to make Arizona once again a player in the entertainment industry. At the heart of the bill is a corporate tax credit for companies with qualifying productions. Included in the criteria for qualification are spending at least $250,000 in the state, that wages paid for the production be subject to Arizona income taxes and that the end credit of the production acknowledge that filming occurred in the state. “They have to spend money to get the credit,” Hall said. An annual cap of $60 million would be established for the tax credits, which Hall said likely would not be reached in the first few years. “But once it has good word-of-mouth they (production companies) might start coming and reach that cap,” she said. A similar effort to create a film and television production tax incentive program was defeated in last year’s legislative session.

BIZ FACTS

SB 1242: multimedia production; tax incentives. What the bill would do: • Creates, retroactive to Jan. 1, 2012, individual and, retroactive to Jan. 1, 2013, corporate tax credits for a multimedia production company. • Allows for a 20 percent credit for an individual production that exceeds $250,000 in in-state spending. • Prohibits the amount of credit from exceeding $15 million for any individual production company. Opponents of the previous proposal didn’t like that it pushed incentives on one industry, essentially lower taxes, while keeping taxes at higher rates for others. Some argued such a plan also would have helped a transient industry without creating a lasting economic impact. Costs have also been a concern among critics, who have pointed to other states that instituted tax incentives. Hall agreed that some states went overboard with incentives as a way to attract the movie business. “Michigan went really strong out of the gate with a 42 percent incentive,” she said. “It was too much, it was irresponsible.” Hall said Arizona’s plan this time seeks

to address those concerns. “This one favors television series production because those are long-term jobs,” Hall said. A typical television series produces about 22 episodes per season over the course of a six- to nine-month production cycle. The mark of a successful TV series is to reach syndication, which generally requires about 100 episodes, or four to five years of production. Backers of the bill, including the Tucson Film Office, worked with production companies including Warner Bros., Universal and Disney to make the incentives package something that would be attractive to the industry. A complaint of the state’s previous incentive plan, which lawmakers passed in 2004 and was allowed to expire in 2010, was that it was cumbersome and difficult for companies to navigate. Hall said the Disney company, for example, estimates that one season of a television series costs as much as $22.5 million. That total doesn’t include an estimated $5 million the company would spend to renovate a large warehouse building to use as a soundstage for filming and production. Currently, there are no soundstages anywhere in Arizona. Lawmakers in the Senate Commerce Committee passed the bill last week. It still needs approval from the finance committee, the full senate and the state house before going to the governor’s desk for her to sign.

Contact reporter Patrick McNamara at pmcnamara@azbiz.com or (520) 295-4259.

Though it has been the brunt of criticism and still subject to an evolving environmental impact statement, Rosemont Copper continues to move ahead on its plans to open a mine in the Santa Rita Mountains south of Tucson. This week, the company, which has sought since 2007 to open a copper mine in the Santa Rita Mountains, played host to a group of astronomers who plan to give insight to Rosemont Copper’s lighting scheme. Because mining operations would run 24-hours a day, lighting, lots of it, would be required. The company wants to implement a lighting plan that mitigates the impact on the dark skies, which the astronomy community appreciates, and the natural environment.

2 views on airlines merger Phoenicians are nearly apoplectic over what the announced merger of American Airlines and US Airways will mean to them. Mainly because the combined airline will move its headquarters from Tempe to Dallas-Fort Worth and in the process recipients of US Airways’ largess may get left out. For the year ended 2011, the US Airways Community Foundation had total assets of $9 million, giving $4.4 million of that to Phoenix area charities. The odds are, Southern Arizonans just want an airline that offers good service and if we didn’t have to stop in Phoenix, so much the better.

New city attitude Tucson Mayor Jonathan Rothschild signaled another new attitude from City Hall in his State of the City speech this week when he said Tucson would not stand in the way of efforts of Vail residents to incorporate. Tucson has long fought incorporation efforts on the fringes of the city, including the 1970s efforts of Marana and Vail and the 1990s efforts of Casas Adobes and Catalina Foothills, both of which failed.


6 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

NEWS PUBLIC NOTICES Public records of business bankruptcies and liens filed in Tucson and selected filings in Phoenix.

BANKRUPTCIES Chapter 11 - Business reorganization Architectural Install Masters Inc., 3234 N. Palo Verde Road. Principal: William C. Oetting, president. Estimated assets: $50,000 or less. Estimated liabilities: $50,000 or less. Largest creditor(s): Schedule not filed. Case No. 4:13bk-01875 filed Feb. 12. Law firm: Eric Slocum Sparks Blue Sierra Inc., 3234 N. Palo Verde Road. Principal: William C. Oetting, president. Estimated assets: $50,000 or less. Estimated liabilities: $50,000 or less. Largest creditor(s): Schedule not filed. Case No. 4:13-bk01876 filed Feb. 12. Law firm: Eric Slocum Sparks Sierra Trust Holdings LLC, 3234 N. Palo Verde Road. Principal: William C. Oetting, president. Estimated assets: $50,000 or less. Estimated liabilities: $50,000 or less. Largest creditor(s): Schedule not filed. Case No. 4:13bk-01876 filed Feb. 12. Law firm: Eric Slocum Sparks The Keys Limited Company LLC, doing business as The Keys, Pearl and Redline Sports Grill, 445 W. Wetmore Road (principal assets at 4975 N. Casa Grande Highway). Principal: Luke Cusack, managing partner. Estimated assets: $50,000 or less. Estimated liabilities: More than $100,000 to $500,000. Largest creditor(s): Internal Revenue Service, Philadelphia, 114,805.60, and Arizona Department of Revenue, Phoenix, $86,563.37. Case No. 4:13-bk-02111 filed Feb. 15. Law firm: Eric Slocum Sparks

LIENS Federal tax liens Beach Baby Tan Club Ltd LLC., 5635 E. River Road. Amount owed: $2,508.72. Aarcher Contracting Corp., 2114 W. Grant Road 140. Amount owed: $3,251.39. Concrete & More LLC and Marcelo Oliva, 140 E. Elm St. Amount owed: $4,680.00. Southern Arizona Air LLC and Basharat Mahmood, 702 E. Fair St. Amount owed: $163,413.18. KGVY LLC, 510 N. Humphreys St., Suite 101, Flagstaff. Amount owed: $2,160.00. Crimson Hair-Skin-Nails Salon Inc., 5060 S. Dominion Drive. Amount owed: $7,686.97. Dwights of Green Valley LLC, 620 W. Ward Lane, Green Valley. Amount owed: $6,201.30. Frankie’s South Philly Cheesesteaks & Hoagies and Frank Santos, 2574 N. Campbell Ave. Amount owed: $2,597.34. STPH Inc., 1635 W. Montebella Place. Amount owed: $11,520.00. Golden Dragon Restaurant and Huynh Nu, 6433 N. Oracle Road. Amount owed: $2,111.75. Medicine Shoppe and VSR Healthcare, 305 S. Euclid Ave., Suite 111. Amount owed: $31,206.85.

Release of federal liens Seaver Franks Architects Inc., 2552 N. Alvernon Way Rebecca M. Rendon Independent Nursing Service, 2641 W. Calle Paraiso Daniel J. Rylander PC, 4340 N. Campbell Ave., Suite 266 Robert Wolkin PC, 3301 E. Camino Campestre L. Enos Painting Inc., 5903 E. Pima St. Jam Ventures LLC, 175 S. La Canada Drive, Green Valley Gene Goldstein Architect and Gene Goldstein, 4729 E. Sunrise Drive Sno-Cones Sonora and Robles Parra Enterprises LLC, 937 W. Congress St. Catalina Limousine & Transportation Services Inc., 3365 S. Country Club Road Nu-Wheel Inc., 3880 S. Palo Verde Road, Suite 406 MWH-LLC Trust Edmond Clark Chapple Trustee and Any Successor Trustee as Alter Ego of Victor Julian Mergard and Hsui-Yu Wnag Mergard, 9420 E. Golf Links Road, No. 299 Adobe Home Health Care Inc., 7670 E. Broadway, Suite 280 AAA Pool Service of Tucson Inc., 4039 S. Escalante Place

PENSIONS FROM PAGE 3 larly suffered, dropping to 63 percent from 83 percent funded in 2007. Contributions from the city’s general fund make up the funding gap and that grew to $27.4 million in 2012 from $12.7 million in 2003. A longer view of TSRS shows even larger disparities. In 2000, the pension plan had a small surplus and was actually overfunded. Police and fire pension funds have equally large funding issues. The once overfunded police pension plan now stands at 52 percent funded with $309.5 million unfunded. Fire has a similar situation, with 50 percent funded and $201 million unfunded. Both of the public safety systems, though, are out of the council’s hands because the state administers them. State lawmakers have begun to look at solutions for public safety pensions in the current legislative session. State law forbids governments from reducing the benefits that were promised to employees. Cunningham said much of the problem could be addressed by requiring employees to contribute larger shares of their salaries to fund pensions. As he described it, newer employees contribute 13.5 percent of salaries while those on the job longer pay five percent of theirs. “The people paying 13.5 percent are covering the people who pay five percent,” Cunningham said. “It’s absolutely ludicrous, it’s insane.” Mayor Jonathan Rothschild asked to

have the discussion next week because he said the issue needs to be dealt with as soon as possible. “We’ve got to put everything on the table,” Rothschild said. “I don’t think this is something we can sweep under the rug any longer.” While no plan of action has been set, the mayor said some possible ways to address the increasing pension costs would be to change the type of retirement benefit that new employees receive. Younger employees might “understand the value of cash,” Rothschild said, adding that higher take-home salaries in the absence of a weekly pension contribution could be an attractive option for some. As example, the city of Atlanta, after facing major funding gaps in its pension plans, moved to individual defined contribution 401(k)-type plans for employees. Other cities have instituted hybrid-type pension plans, something that’s neither wholly a traditional defined-benefit pension nor defined-contribution. “Everything I’m trying to do is designed to save people’s jobs,” Rothschild said. The mayor said he doesn’t want the city to have to start asking new employees to contribute 20 percent or more of their salaries to pay for the pensions of retirees. But even changing the form of retirement plans doesn’t necessarily mean a city will see immediate savings, according to JeanPierre Aubry, assistant director of state and local research at the Center for Retirement Research at Boston College. “It’s not that a DC plan (defined contribution) is cheaper,” Aubry said. “It’s not a magic bullet.” He said the changes would take as long as 30 years to take effect because the new

crop of employees would have to work their entire careers before cashing in on the plans. The larger concern for cities, Aubry said, is the percent of the budget that goes toward pension plans. Research he and his colleagues at Boston College have found that cities can manage pensions effectively if they can keep the plans’ impact on the overall budget to five percent or lower. In Tucson’s case, city contributions just to TSRS represent 6 percent of the general fund and 2 percent of the overal budget. Even the declining funded portions of pension plans should not be seen as insurmountable. “60 percent funded is not an indication of insolvency, it’s really a matter of setting the plan back on the right path,” Aubry said. Cunningham said the city could fix much of the pension funding issue if all employees were required to contribute the same amount. “If all employees paid 10 percent, we would reduce the hit to the general fund by 50 percent,” he said. That option, however, could be difficult to achieve. Both Cunningham and the mayor said requiring existing employees to contribute large amounts could be construed as a reduction of benefit and therefore illegal. At the very least, the city likely would face a lawsuit from employees if they were forced to contribute more than their contracts required. “That’s a big challenge,” Rothschild said.

Contact reporter Patrick McNamara at pmcnamara@azbiz.com or (520) 295-4259.

McCain: Sequester could cost 49,000 jobs in Arizona By Philip Franchine Green Valley News Automatic federal spending cuts will cost 49,000 jobs in Arizona and nearly $5 billion in economic output if Congress does not agree on deficit reduction, according to U.S. Sen. John McCain, R-Ariz. Speaking to a crowd of more than 160 at a town hall in Green Valley Tuesday (Feb. 19), McCain repeatedly blamed President Obama for failing to bring Congress to a deficit reduction agreement that would replace the sequestration automatic cuts. “The economy is beginning to crawl back in Arizona and this could be a big blow,” he said, noting the biggest impact would be on defense contractors including Raytheon Missile Systems. Congress in 2011 passed a law imposing the cuts if Congress and the president do not agree on a deficit reduction plan by March 1. The 2013 cuts include $500 billion in defense spending and $700 billion in non-defense items.

McCain said the result in Arizona would be cuts of $101 million in key education, health and labor programs; a loss of $4.9 billion in gross state economic output, the majority from defense; and the loss of more than 300 healthcare jobs, 700 education jobs and 35,000 defense jobs. McCain, who spoke for 25 minutes then took questions for nearly an hour, said he is part of a bipartisan group of eight senators working toward a comprehensive immigration reform bill that would pass both houses of Congress. He is hopeful the bill will include provisions for temporary farm workers, immigrant workers filling high-tech jobs and certain other jobs, such as tourism jobs. He also said expects the bill will address the so-called DREAMers who were brought to the U.S. illegally as children; border security, including technology borrowed from the military; and a provision for the estimated 11 million become legal residents if they pay a fine, taxes, learn English and are considered after others who legally entered the country. McCain said he would also like to see a fool-

proof Social Security card so employers can be sanctioned if they hire illegal workers. McCain also told the audience he would consider reducing Social Security and Medicare benefits for wealthy seniors along with all other approaches, such as raising the age at which benefits can be paid out, but said the real issue is the rise of health care costs. In response to a question from Sahuarita resident Amie Bradshaw asking why U.S. citizens are subject to the Border Patrol checkpoint on Interstate 19 north of Tubac, McCain chuckled and said, “I’m not in favor of fixed security checkpoints. I think any smuggler worth his salt will go around them.” But, he said, “the country needs to have this conversation” and the Tucson Sector is a “long, long way” from being secure. He said drug cartels that also control human smuggling increasingly use high-technology methods to evade law enforcement and are extremely violent.

Contact reporter Philip Franchine at pfranchine@gvnews.com or (520) 547-9738.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

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FEBRUARY 22, 2013

NEWS LEGAL FRONTLINE

Tucson bucks new state law streamlining permit process When seeking a permit or license from a county or city, one of the most commonly asked questions is: How long will it take for the application to be processed? Until now, we could only respond with an educated guess based on past history and the nature of the project. But with the Legislature’s passage last year of a new law, all cities, counties, and county flood control districts (collectively, “municipalities”) were required by the end of 2012, to establish a time frame to either grant or deny a license or permit application. This new statutory requirement was intended to create a faster and more predictable permitting process in Arizona. From a project planning standpoint, it is important for businesses and individuals to understand how municipalities are implementing the requirement to adopt licensing time frames because municipalities have taken a variety of different approaches. Some municipalities, for instance the City of Tucson, appear resistant to setting definitive, reasonably short time frames for themselves to approve or deny an application and instead have set lengthy time frames that encourage applicants to opt out. Other municipalities have established just one time frame for virtually all permit applications. The City of Tucson adopted a potentially controversial approach in response to the new law (SB 1598 last year) setting time frames that are substantially longer than those of other municipalities. For instance, if an individual were to apply for a home occupation permit in unincorporated Pima County, the county has adopted a plan under the new law that gives it a total of 40 calendar days to approve or deny the application. If the same application is filed in the City of Tucson, the city gives itself more than twice as long, 85 calendar days, to review and approve or deny the application. Additionally, the city offers a “Flexible Application Process” that encourages applicants to opt-out from the time-frame requirements contained in SB 1598. Under the Flexible Application Process, the city says

it will review the same home occupation permit in just 20 working days, but the city says it will not refund fees if it fails to approve or deny the application within that time. In yet another SCOTT MCDONALD attempt to encourage applicants to opt out of the SB 1598 time frames, the City of Tucson maintains that after the submittal of an application, development changes proposed by the applicant are not allowed, apart from the one permissible request for additional information prior to the application being deemed “administratively complete.” Therefore, as the City of Tucson applies SB 1598, any amendment or supplement to an existing application by the applicant essentially constitutes a new application, which restarts the clock on licensing time frames and requires additional permitting fees. The city contends that under its Flexible Application Process, however, applicants have multiple opportunities to alter or amend their application and to confer with city staff for advice. SB 1598’s requirement that all municipalities establish time frames to either grant or deny a license or permit application is intended to create certainty for businesses and individuals seeking a license or permit. But for the time being at least, questions regarding the implementation of licensing time frame requirements by different municipalities remain.

Contact Scott McDonald, an attorney with Fennemore Craig in Tucson, sdmcdona@fclaw.com. McDonald has extensive experience in zoning and land use development, including use permits, special use permits, zoning interpretations, and zoning enforcement actions. The Legal Frontline column appears monthly addressing various legal issues that may face business leaders.

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10 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

GOOD BUSINESS WOMEN IN BUSINESS

How to get your business’ press release in the news Even if you’re not General Motors, Ford or Apple – companies who are news magnets – it doesn’t mean your company, small or large, can’t get press. The giants generate newsworthy information in the media because of new innovations, but they also have public relations, marketing and advertising teams working to secure the precise information they want made public. The least costly is the press release. Every company should generate press releases on new programs, technology, promotions or new hires keeping the public abreast of what your company is doing. A reporter, whether print, broadcast or digital, may scrutinize the release as a source of information, but a true professional journalist will see the release as a reference point. A professional journalist will query the source before releasing a story, even if a press release appears accurate. Since stories from businesses are generated for the company’s best interest and may be biased, reporters may not see it as a news story. Convincing a reporter the source is reliable can be a problem. With many reporters deleting most press releases, opening only those from known

Tucson/Oro Valley

sources, how can your company ensure your release will be read? Part of the success is submitting a simplified form that can be read easily. At the top of the release should be a short MAXINE GOODMAN headline relating what the story is about. Several lines down should be: FOR IMMEDIATE RELEASE: (with date). Following this should be a contact person, with title, phone number, email address and website. The opening paragraphs should contain: who, what, when, where and why and how. Your first sentence is the “lede”. It should contain effective information that will make an editor determine immediately whether to read further. Use an “inverted pyramid,” writing a news story with the most salient points at the top and then supporting points of progressively descending importance so the story can be easily cut

from the bottom if necessary without changing the most important points. Read, listen and watch media where you wish to place your story to see if it is likely to be a feature or news and then pitch it in the appropriate manner. Maintain a media list, including newsletters of organizations. Deadlines are paramount in getting your story out and plan ahead. A good rule is two weeks in advance for daily newspapers and broadcast media. Even though a TV station may not decide to cover something until the day of the event, it must be placed on an assignment sheet, especially if it’s a feature. For monthly publications, including newsletters, think at least a month ahead. Call each media outlet to find out exact deadlines. Decide if you want a full-fledged story or a news brief and submit as such, checking to see which editor is viable. If it’s an education piece, for example, send the story to the education reporter or editor and make sure it only goes to one person at a time so several reporters aren’t working on the same story. This is one way to get a story “killed.” Short announcements may be submitted to

as many media outlets as you want. Try to work with only one person at each media. Contact the news desk to know the best reporter to approach. If you are under deadline, it’s especially important to have the story ready to send immediately if a reporter or editor is receptive to the idea. Using verbatim quotes makes the story more credible when the source is identified. Avoid excessive adjectives and jargon. Follow up and be patient. Depending on what other events are occurring, like breaking news, your story may have to wait. Although as a rule of thumb, the shorter the story the better, a well-written story, even a longer feature, may be rewarded with a byline. The best way to send your targeted release is by email.

Contact Maxine Goodman, president of Words Ink, at maxinegoodman17@yahoo. com or (520) 622-0905. Words Inc. is a public relations agency at www.prioritywords.com. Goodman is a member of the Greater Tucson Chapter of the National Association of Women Business Owners (NAWBO) whose members contribute this monthly column.

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12 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

PEOPLE IN ACTION ELECTIONS

member of the El Rio Health Center Foundation.

Office Smart, a regional supplier of office products and supplies announced that its president, Glenn McDaniel, has been elected the 2013 Chair of the National Office Product Alliance (NOPA), the national association for office products dealers for more than 100 years. McDaniel will provide leadership with the Board of Governors and NOPA staff in setting 2013 priorities and planning and executing NOPA’s government advocacy efforts, product data standards and other industry initiatives. Mike Webb, of the Jim Click Automotive Team, has been elected a board

APPOINTMENTS University of Arizona Medical Center neurosurgeon G. Michael Lemole has been named to a two-year term as chief of staff at The University of Arizona Medical Center – University Campus. Elected by the hospital’s medical staff, Lemole will be the chief administrative officer for the nearly 800 university and community physicians who practice at the University Campus. He also will serve as chairman of the hospital’s Medical Executive Committee. Lemole is an expert in skull-base surgery. His clinical interests include

MIKE WEBB

diseases of the base of the cranium, or skull base, where all of the critical blood vessels and nerves enter or exit the skull. Lemole received his undergraduate degree from Harvard University and his medical degree from the University of Pennsylvania. He completed his residency in 2002 in neurological surgery at Barrow Neurological

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{YOUR NAME HERE} To announce a professional promotion, appointment, election, new hire or other company personnel actions, fax press releases to (520) 295-4071, Attention: People; or email submissions to pmcnamara@azbiz.com. Include an attached photo at 300 dpi.

NEW HIRES The Westward Look Wyndham Grand Resort & Spa has announced the hire of Antonio Rodriguez as executive chef. Rodriguez returns to Tucson after two years of serving as executive chef of the Hotel Galvez & Spa in Galveston, Texas.

Rodriguez has 20 years of culinary experience in the restaurant and catering kitchens. Previously, he was executive chef for nine years at Omni Tucson National Golf Resort and Spa, executive sous chef at Omni Hotel Park West and Westin Hotel Galleria in Dallas, banquet sous chef at Westin William Penn Hotel in Pittsburgh and restaurant sous chef/banquet sous chef at Westin Paso Del Norte Hotel in El Paso, Texas. AWARDS The Tucson Utility Contractors Association has announced it 2012 Person of the Year Awards. This year the award went to Jim DeGrood, with the

Regional Transportation Authority. The organization’s 2012 Ditch Digger of the Year Award goes to Todd Adams of Trinity Southwest. TUCA’s Associate member of the year goes to Maggie Mozingo of Precision Tool and Time Schutte of Earhart Equipment. Tom Kilargis, Pima County Department of Transportation, was award the 2012 Agency/Municipal Member of the Year. The Ben Patton Luster Award, a safety award, go to Trinity Southwest, Southwest Gas and Granite Construction.

LOG ON TODAY! www.InsideTucsonBusiness.com


InsideTucsonBusiness.com

FEBRUARY 22, 2013

13

MEDIA

Clear Channel fires salvo directly at Cumulus’ KIIM By David Hatfield Inside Tucson Business The nation’s two biggest radio operators are stepping up the competitive battles between their Tucson operations. Clear Channel Media and Entertainment fired a retaliatory salvo on Feb. 14, switching formats on one of its FM signals to country music to compete more directly against Cumulus Media’s long-time top-rated country station KIIM 99.5-FM. The move comes a year after Cumulus made a similar move, launching top 40 i97-5 KSZR 97.5-FM to go head-to-head against Clear Channel’s dominant station in the market, KRQ 93.7-FM. Clear Channel’s latest move came at noon Feb. 14, when it switched the FM frequency of KNST from news-talk to what it’s billing as Wild Country 97.1-FM. Aside from making the announcement, Clear Channel’s Tucson officials weren’t talking publicly about their motives for the change. According to some advertisers on KNST’s news-talk format, they were told only hours before the change took place. The news-talk format, including Garret Lewis, Rush Limbaugh, Sean Hannity and Glenn Beck, remains on KNST’s AM signal, 790-AM. Since the switch, 97.1-FM is promoting plans to play 10,000 country songs in a row. The format switch is emblematic of a new tactic in radio competition. The goal isn’t so much to beat the other guy but to grab enough listeners away from the big guy to lower its ratings — and in the process add a few more listeners to the challenging cluster’s overall complement of stations. In both cases, i97-5 a year ago and Wild Country this year, the stations are licensed by the Federal Communications Commission as Class A operations with power much lower than that of the dominant stations, both Class C stations under the FCC. Wild Country 97.1-FM is broadcasting with 1,750 watts of effective power output to KIIM’s 93,000 watts. I97-5 is broadcasting with 6,000 watts to KRQ’s 90,000 watts. With their lower power output, neither of the two Class A stations could hope to reach the same potential audience as the two Class C stations. KIIM, which has been broadcasting its country format since 1983, has fought off previous challengers, most recently from Clear Channel with Coyote Country. It was broadcast on 92.9-FM for 2½ years until December 2003. That station, which is a Class C station with 90,000 watts, is now My 92.9 KMIY. In its latest announcement, Clear Channel indicated the Wild Country format

would focus on new country music from artists including Kenny Chesney, Jason Aldean, the Zac Brown Band and Carrie Underwood. While KIIM plays those same songs, it also plays older country songs. Starting March 8, Wild Country will introduce a new syndicated morning show, “The Bobby Bones Show,” which will originate from Nashville. The show, which features two other personalities known as Lunchbox and Amy, had been originating from Austin, Texas, and getting good ratings on a group of top 40 stations in Texas and Oklahoma until Clear Channel announced this month that it was moving it to Nashville as a morning show for country stations. Local advertising executives confided they weren’t surprised by Clear Channel’s move, noting that adding FM to KNST’s programming 15 months ago had not made much of a change in the ratings. It remains to be seen whether theory will play out that Wild Country will take enough audience away from KIIM to knock the Cumulus station off the top of the ratings pedestal in Tucson. While KRQ may have lost a few listeners, it remains one of the Tucson market’s top-rated stations. And there are those who believe the “hot adult contemporary” format of Clear Channel’s own My 92.9 launched in November 2011 may be as responsible for taking away some of KRQ’s audience as anything i97-5 has done. Some of those same people caution that Wild Country’s hit orientation could also canibalize KRQ’s audience. Just to show how intense the competition between the two radio conglomerates is getting, beyond what listeners are hearing on the air, Clear Channel’s latest move also added a new wrinkle by registering three domain names that it figures the Cumulus group might want: Nash995.com, NashTucson.com and Nash975.com. The first two would pertain to the future of KIIM and an announcement last month that Cumulus intends rebrand all of its country stations as Nash. The third domain might be a back-up plan should Cumulus decide to put the Nash branding on what is now i97-5. And here you thought radio only mattered to while away time while driving.

Contact David Hatfield at dhatfield@azbiz.com or (520) 295-4237. Inside Tucson Media appears weekly.

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14 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

TRAVEL

American, US Airways merger; what does it mean for Tucsonans? By David Hatfield Inside Tucson Business The biggest news of the month was the Feb. 14 announcement that the boards of directors of American Airlines and US Airways had approved a long-anticipated merger agreement. While the announcement provided details of the $11 billion transaction, it did little to answer questions regarding what the future holds for passengers of what will be the world’s largest airline — provided it meets regulatory approval, including from the judge overseeing American’s Chapter 11 bankruptcy. For Southern Arizona travelers, the biggest questions center on which airport hubs will be used by the combined airline. American, the second-busiest airline at Tucson International Airport, flies to three hubs: Dallas-Fort Worth, Chicago O’Hare and Los Angeles International (LAX). US Airways flies only to Phoenix Sky Harbor International. In 2012, American was Tucson’s second busiest airline behind Southwest, carrying 23.5 percent of the airport’s total of 3.6 million passengers. US Airways was fourth behind United-Continental, carrying 11.5 percent of passengers. A common theme among airline experts is that US Airways’ hub Sky Harbor is at risk for maintaining that status. Reasons given are: • Phoenix, being situated between DallasFort Worth and LAX, is redundant as a hub. • Competition between US Airways and Southwest Airlines, Sky Harbor’s two busiest airlines, has resulted in some of the lowest fares at any hub, which in airline parlance means lower yields, or less money per passenger. • Sky Harbor would have the fewest international flights of any of the combined airline’s hubs. Despite these negatives, Robert Mittelstaedt, dean of the W. P. Carey School of Business at Arizona State University and an aviation expert, is one who doesn’t believe Sky Harbor will lose its hub status. He says he believes US Airways Chief Executive Doug Parker, who will also be CEO of the combined carrier, when he says Phoenix will continue to be a hub. The alternative, Mittelstaedt said, would require expansion at Los Angeles International where American is already operating at near capacity levels for its space in Terminal 4. “There are many people in southern California and even central California who will do whatever they can to avoid the hassles of LAX to use their nearest airport,” he said. “And they’re willing to accept a logical connection on the way to do it. Phoenix is ideally situated for that.” Gov. Jan Brewer and Phoenix Mayor Greg Stanton say they, too, have been assured by Parker and US Airways officials that Sky Harbor will continue to be a hub. Despite those assurances, those who be-

TUCSON INTERNATIONAL AIRPORT JANUARY PASSENGER STATISTICS Tucson International Airport started out 2013 with passenger totals down 8.7% from January 2012. Available outbound seat capacity was down 14.5% to an average of 5,504 per day. This table shows each airlines’ passenger totals and market share for January 2013 compared with January 2012.

Airline

January 2013 January 2012 Change Passengers Market Passengers Market Passengers % Share

Non-stop destinations

Southwest

87,695

Share

32.9%

93,751 32.1%

-6,056

-6.5%

69,898 24.0%

-1,403

-2.0%

40,888 14.0%

+298

+0.7%

-3,272

-9.4%

Albuquerque, Chicago Midway, Denver, Las Vegas, Los Angeles, San Diego

American

68,495

25.7%

Chicago O’Hare, Dallas-Fort Worth, Los Angeles

United (Continental)

41,186

15.5%

Denver, Houston Intercontinental, Los Angeles, San Francisco

US Airways

31,560

11.9%

34,832 11.9%

28,323

10.6%

28,422

9.7%

-99

-0.3%

3.4%

11,538

4.0%

-2,501

-21.7%

12,400

4.3%

-12,400

-100%

-25,433

-8.7%

Phoenix

Delta

Atlanta, Minneapolis-St. Paul, Salt Lake City

Alaska

9,037

Seattle

Other Frontier Airlines ended service as of May 18 , 2012

Total

266,296

291,729

Source: Tucson Airport Authority Totals include passengers on branded flights operated by contracted carriers: American (includes American Eagle), Delta Connection (SkyWest), United Express (ExpressJet and SkyWest) and US Airways Express (Mesa and SkyWest).

rest could take years to fall into place.” And while Tucson Airport Authority officials weren’t talking, they probably wouldn’t mind if Sky Harbor became a less attractive draw. It’s estimated that about 800,000 airline tickets annually — 23 percent of those sold in zip codes in the Tucson market — are for flights out of Phoenix.

Slow January Tucson International Airport had an inauspicious start to 2013 with January passenger numbers down 8.7 percent to 266,296. It was the slowest January at the airport since 2002, four months after the Sept. 11, 2001, terrorist attacks. If there is a silver lining to the numbers, it’s that passenger numbers aren’t down as much as airlines have reduced available seat capacity, which dropped 14.5 percent in January from a year ago to an average of 5,504 per day. The biggest cuts by airlines were to Denver, down 45.9 percent to an average of 432 seats per day; San Francisco, down 57.6 percent to an average 56 seats per day; Chicago Midway, down 43.7 percent to 143 seats per day; Seattle, down 33.5 percent 171 seats; Phoenix, down 18.9 percent to 654 seats; and LAX, down 10.4 percent to 866 seats per day. No airline added significant capacity to any destination in January compared to a year ago.

Sky Harbor numbers lieve Sky Harbor is due to be downgraded point to Houston as a prime example for what airlines say at the outset of a merger versus what actually happens. Houston was Continental Airlines’ headquarters before its 2010 merger with United. Former Continental CEO Jeff Smisek became CEO of the combined airline and moved to United’s hometown, Chicago. And since then, has begun trimming flights at Houston. US Airways is currently operating between 250 and 300 flights a day out of 50 gates in Terminal 4 at Sky Harbor. Southwest is operating between 160 and 190 flights a day out of 24 gates, also in Terminal 4. American is currently operating about 20 flights using three gates in Terminal 3. One thing nearly all agree on is that US Airways’ flights between Tucson and Phoenix are likely to be trimmed under the merger. Virtually all who fly between the two cities use Sky Harbor for connections to other destinations. There are total of 12 connecting destinations — six in the U.S. and six in Mexico — that are currently served exclusively via US Airways as a single airline. Four of them — Albuquerque, El Paso, Flagstaff and El Paso — are within reasonable driving range and have low demand from Tucson. The other two domestic destinations — Long Beach, Calif., and Durango, Colo. —

could be problematic for some travelers. A vacuum to the Mexico destinations — Guadalajara, Guaymas, Hermosillo, Mazatlan, Puerto Vallarta, and San Jose Del Cabo — could open some possibilities for Tucson to regain international commercial flights, though no local officials who might be knowledgeable about the situation were willing to go there yet. There are 19 destinations from Tucson that are currently exclusive to American as a single airline, nearly all via either DallasFort Worth or Chicago. One thing that was made clear in the Feb. 14 announcement is that the merged airline, which will be named American, will be headquartered in Texas, not Tempe. ASU’s Mittelstaedt says he’s not so concerned about the impact of the executive jobs that will leave what is now US Airways’ Arizona headquarters, saying “people just have to get over that.” He said he’s far more concerned about the hundreds of jobs that are at stake at Sky Harbor by a signifcant down-grade of its hub status. And what ultimately happens could be years away. Once the two airlines receive approval for the merger, it could take place before the end of this year. “Putting passengers on airliners painted in two different colors isn’t the most difficult part of a merger,” Mittelstaedt said. “The

Passenger traffic at Phoenix Sky Harbor International Airport in 2012 was down 0.4 percent from the previous year to 40.42 million, according to the City of Phoenix, which owns the airport. Despite the drop from last year, the Phoenix numbers are up from the three worst years — 2008, 2009 and 2010 — of the Great Recession, which was not the case for Tucson. Last month, the Tucson Airport Authority reported that 2012’s numbers have been down four of the last five years — up only slightly in 2010.

Together as one It’s official now, at least at Tucson airport: United and Continental are fully merged. The two airlines finished combining their “back-of-the-house” operations in January and are working out of a single ticket counter — the one formerly used by United east of the entrance to the B concourse. Although both airlines have been operating out of gates on the B concourse, Continental had been using other counter space in the terminal.

Contact David Hatfield at dhatfield@azbiz.com or (520) 295-4237. Inside Business Travel appears the fourth week of each month.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

15

BRIEFS GET ON THE LIST

Next up: Hospitals, Rehabilitation centers, Nursing care centers, Home health care Research is underway gathering data for the 2014 Book of Lists. Upcoming lists are: • March 1: Event planners, Convention and meeting facilities, Caterers • March 8: Environmental resources, Recycling firms, Janitorial services, Pest control companies • March 15: Acute-care hospitals, Rehabilitation centers, Nursing care centers, Home health care agencies • March 22: Investment capital and lending, Venture capitalists • March 29: 501(c)3 organizations, United Way allocations, Charitable trusts If your business has been on a previous list in one of these categories, look for an email from Jeanne Bennett, list researcher for Inside Tucson Business, with details on how to update your profile. If you would like to add your business to one of these lists, go to www.InsideTucsonBusiness.com and click the Book of Lists tab at the top of the page to create a profile. The Book of Lists is a year-round reference for thousands of businesses and individuals. The 2013 Book of Lists was published Jan. 25. A limited supply of copies is still available for purchase, either online at www.InsideTucsonBusiness.com, click on “Book of Lists” on the black navigation bar, or call (520) 294-1200.

TRANSPORTATION

Last hearing set for Tangerine Road The last public hearing on the Regional Transportation Authority’s (RTA) Tangerine Road Improvement Project will be held Monday (Feb. 25) at the Oro Valley Council Chambers, 11000 N. La Canada Drive. The project covers Tangerine Road from Interstate 10 to La Canada Drive. Major improvements will include widening the road to two lanes in each direction with landscaped medians, upgrading drainage infrastructure, and installing turning lanes and signals, and pedestrian and bicycle facilities. The plans are detailed in the Final Design Concept Report and also online at www. tangerineroad.info. The meeting is scheduled for 6 - 7:30 p.m. Members of the design team will take questions. In addition to the public forum, comments can be sent to Genna@kaneenpr.com.

CULTURAL/RECREATION

390th Memorial Museum to open during renovation The 390th Memorial Museum, on the

grounds of the Pima Air & Space Museum, 6000 E. Valencia Road, will remain open to visitors while undergoing an extensive $2.4 million expansion and renovation. The 390th Memorial Museum is dedicated to honoring those who served in the 390th Bombardment Group during World War II. The squad bombed aircraft factories, bridges and oil refineries and 714 of its airmen lost their lives in the name of freedom. The memorial is funded and operates independently from the Pima Air & Space Museum. The expansion and renovation project was designed by M3 Engineering, 2051 W. Sunset Road, and is being built by Lloyd Construction Company, 2180 N. Wilmot Road. Emile Therrien, executive director of the 390th museum, said improvements are to be completed by August.

EDUCATION/RESEARCH

dicts careers in logistics and supply chain management could grow 26 percent from 2010 to 2020. Jobs in the field have grown in importance in the Tucson region in connection with the deep-water port in Guaymas, Sonora; expansion of the Mariposa Land Port of Entry in Nogales; and Union Pacific Corp.’s planned rail yard near Picacho Peak. PCC offers an associate of applied science as part of its Logistics and Supply Chain Management Program.

KUDOS

Fastsigns Tucson owners honored among the best Christi and Bud Guion, owners of Fastsigns of Tucson at 3988 N. Oracle Road, have been honored by the corporation as one of its top centers nationally. The hus-

band-and-wife team received the company’s prestigious Pinnacle Club Award at the recent Fastsigns Convention in Dallas. The award recognized centers that rank between number 25 and 125 in the nation for sales volume during 2012. The Guions have won the award four years in a row and said it was especially meaningful since they are currently celebrating 20 years in business. “This award is a testament to all of the hard work, excellent customer service and innovative thinking the team provides,” said Bud Guion. “The support of our customers through the last two decades is one of the biggest reasons we received this award,” added Christi. Nationally, Fastsigns has more than 450 locations.

Pima College offers plan to fill need for nurses Pima Community College has started a new program aimed to help fill the continuing need for more qualified nurses. The program allows students who are pursuing an associates degree in nursing at PCC to simultaneously earn a bachelor of science in nursing from Northern Arizona University. PCC’s Concurrent Enrollment Associate of Applied Science and Baccalaureate Degree Nursing Program began this semester. It enables students in Tucson to take NAU courses online or in a hybrid format as they work to fulfill the program’s 120-credit requirement. The program is designed to be completed in five semesters and is being offered through the PCC’s Nursing Department on the west campus, 2202 W. Anklam road. PCC’s nursing program is approved by the Arizona State Board of Nursing and is accredited by the National League for Nursing Accrediting Commission.

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6 PCC students receive logistics scholarships Six Pima Community College students were among 14 Arizona students awarded Southern Arizona Logistics Education Organization scholarships. The scholarship recipients and PCC program of study are: Kristine K. Bigelow, associate of applied science, logistics and supply chain management; Timothy F. Bolen, associate of applied science, logistics and supply chain management; Andrew Dirk Morrell, associate of applied science, logistics and supply chain management; Lisa Marie Sarmiento, associate of applied science, logistics and supply chain management; Stephanie Michelle Savory, associate of general studies; Bryce James Whiteside, associate of applied science, logistics and supply chain management. The students each will get a $1,000 scholarship from SALEO. The U.S. Bureau of Labor Statistics pre-

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16 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

OUT OF THE OFFICE ARTS & CULTURE

ON THE MENU

How I came to my new love of Beer, bacanora and Old West at Rodeo Days arts celebration beets and brussel sprouts Even as a child I enjoyed mixing garlic salt, parsley flakes and black pepper into a fine dust for house-made popcorn, and often looked beyond the kids menu when eating out with the family, in search of a life-changing liver and onions platter or fresh oysters on the half shell which I slurped up with audible delight. But two foods have completely escaped my fascination. In fact, I’ve spent more than 40 years actively avoiding them. My outlook has changed and now I’m now proud to proclaim – wait for it – that I love beets and brussel sprouts (yes Mom, you read that correctly). So who is responsible for inspiring this epicurean epiphany? Chef Janos Wilder of Downtown Kitchen + Cocktails, 135 S. Sixth Ave., has always loved beets, and says he never understood the aversion so many have to them. “A beet is not one of those foods that requires an adventurous eater but for whatever reason they scare some people to death,” he acknowledges. In its raw state a beet is “earthy with some acidic notes,” Wilder says, admitting that may not appeal to some taste buds. He suggests the best flavors result from roasting, or even frying, beets. “Slowly roasting a beet, or frying it at a low temperature, allows the carbohydrates to turn to sugar, ultimately producing a nuttier, somewhat sweeter flavor.” Wilder features these beauties in his beet carpaccio salad, with avocado mousse, goat cheese croutons, local oranges and grapefruits and a jalapeno orange vinaigrette. When he encounters a guest who demonstrates some reluctance in ordering a dish with beets, he simply invites them to try it – and he hasn’t once had them sent back. On the brussel sprouts beat, Chef Bruce Yim of the Grill at Hacienda Del Sol, 5501 N. Hacienda Del Sol Road, tells me these

baby cabbages are actually part of one of the restaurant’s top-selling dishes. They’ve gotten a bad rap over the years, but he says they’ve evolved from “tasteless mushy balls that MATT RUSSELL spent more time in people’s napkins than in their mouths” to a serious player in the culinary arts. Yim attributes thoughtful preparation to the renewed interest, admitting that parents of the 1970s didn’t really know how to cook them. “They were basically just boiled to death,” he recalls from his own childhood experience, which he says didn’t allow the potential of the sprout to be realized. Today he brings the brussels together with a sauté and coating of bread crumbs, to accompany pacific snapper with a smoked tomato hollandaise. “The slight bitterness of the brussels works very well with the rich and fatty profile of this sauce,” he said, “and when you allow the brussels to work with other flavors on the plate, that’s when the reinvention happens.” Brussel sprouts are now regulars at the Russell’s. And as for my other newly discovered treat, all I am saying…is give beets a chance.

The third annual Rodeo Days Arts Celebration takes place from 11 a.m. to 8 p.m. Saturday (Feb. 23) at the Steinfeld Warehouse, 1010 W. Sixth St. Admission is free to the event that celebrates the Tucson region’s Old West culture with art, live music, samplings of Tucson-made beer, Sonora-made bacanora, a food truck roundup and horse-drawn carriage rides. A portion of sales of beer, bacanora and food will benefit the Tucson Musicians Museum Mentorship Program, Warehouse Artists Management Organization’s Friends of Steinfeld Warehouse and Dinnerware Gallery. To get into the spirit if you go, you’re encouraged to wear western or Old West style clothes.

Contact Matt Russell, whose day job is CEO of Russell Public Communications, at mrussell@russellpublic.com. Russell is also the host of “On the Menu Live” that airs 4-5 p.m. Saturdays on KNST 790-AM and does the Weekend Watch segment of the “Buckmaster Show” from noon-1 p.m. Fridays on KVOI 1030-AM.

Musical theater

Dance The dancer-illusionist company MOMIX pays a return visit performing at 7 p.m. Sunday at Centennial Hall, 1020 E. University Blvd. on the University of Arizona campus. The program, “Botanica,” features athletic dance, large-scale puppets, projected imagery and larger-than-life props with an eclectic musical score to explore the diversity and beauty of nature. Individual tickets are $30 to $60, with discounts for students, children, seniors, military and UA staff. Buy them through UApresents at www.uapresents.org.

“All Shook Up,” a high-energy musical inspired by and featuring 24 songs made famous by Elvis Presley, will be performed by the performing arts department at Pima Community College through March 3 in the Proscenium Theatre on the West Campus, 2202 W. Anklam Road.

Performances are at 7:30 p.m. Wednesdays through Saturdays and 2 p.m. Sundays. Tickets are $18 and $16 each. Buy them online at www. pima.edu/ HERB STRATFORD community/ the-arts/theatre-arts/ or through PCC’s box office at (520) 206-6986, which is open from noon to 5 p.m. Tuesdays through Fridays and one hour before showtime.

Film This is your last chance to see an Academy Award-nominated film before the awards are handed out Sunday night. I’m betting on “Silver Linings Playbook” to be a surprise for Best Picture, Daniel DayLewis as a lock for Best Actor and I hope Jessica Chastain wins Best Actress for her role in “Zero Dark Thirty.” A few new films will arrive this weekend before studios push the weekend’s Oscar winners back out into release, including the alien-demonic possession film “Dark Skies” from the producers behind the film “Insidious” and the action film “Snitch” with Dwayne Johnson and Susan Sarandon. Loft Cinema, 3233 E. Speedway, will debut the new sci-fi cult favorite “John Dies at the End” and the excellent Korean film “Masquerade” which re-imagines the classic prince and the pauper tale in feudal Korea.

Contact Herb Stratford at herb@ ArtsandCultureGuy.com. Stratford teaches Arts Management at the University of Arizona. His column appears weekly in Inside Tucson Business.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

CALENDAR REGULAR MEETINGS

LeTip Tucson Executives Chapter meeting Every Tuesday, 11:30 a.m. to 1 p.m. Macayo’s Mexican Kitchen 7360 N. Oracle Road RSVP: (520) 299-9600, bwmartin@cox.net LeTip International I-19 Business Networkers Every Tuesday, 11:30 a.m. to 1 p.m. Amado Territory I-19 exit 48 Information: (520) 591-5500 Cost: $15

NAWBO Monthly Luncheon Second Tuesdays 10:30 a.m. to 1:30 p.m. Locations vary Info: Morella Bierwag, (520) 326-2926 or info@ nawbotucson.org National Association of the Remodeler’s Industry (NARI) Tucson Third Tuesday 5:30 p.m.

Varies, call for location Information: (520) 310-3386 rebecca@ nariofsouthernarizona.com Cost: Free to members and first timers Networks @ Work First Wednesdays 11:30 a.m. to 12:30 p.m. Sullivan’s Steak House 1785 E. River Road Contact: Ricardo Carrasco at (520) 977-8812 or Ricardo@gsfloans.com

Cost: Meal from menu ($12-$25) Networking Club in Northwest Tucson Ali Lassen’s leads club First Wednesday noon to 1 p.m. Sullivan’s Steak House 1785 E. River Road RSVP: Johnna Fox (866) 551-3720

Networking Entrepreneurs of Tucson Networking breakfast First and third Wednesday 7 to 8:30 a.m. Hometown Buffet 5101 N. Oracle Road Information: (520) 240-4552 Greater Oro Valley Chamber Monthly Luncheon Fourth Thursday of the month 7 to 8:30 a.m. El Charro Café 7725 N. Oracle Road

http://the-chamber.com Greater Oro Valley Chamber Monthly Membership Breakfast Second Thursday 11:30 a.m. Loews Ventana Canyon 7000 N. Resort Drive Cost: $20 members / $30 non-members Contact: Alex Demeroutis (520) 297-2191 alex@orovalleychamber.com

Tucson Breakfast Lions Club Wednesday 7 to 8 a.m. Radisson Suites Tucson 6555 E. Speedway TBLCTREA@Dakotacom.net Marana Chamber of Commerce Breakfasts First Wednesday, 7:30 a.m. Taste of Texas 8310 N. Thornydale Road RSVP: (520) 682-4314 Marana Chamber of Commerce Mixer Fourth Tuesday of each month 5:30 to 7:30 p.m. Locations vary Information: www. maranachamber.com Meet Toastmasters Every Wednesday 6:15 a.m. Chaffins Diner 904 E. Broadway Contact: Hitch Paprocki hitchpaprocki@hotmail.com (520) 907 4455 www.toastmasters.org Metropolitan Tucson Convention & Visitors Bureau First Wednesday Monthly Luncheon 11:45 a.m. to 1 p.m. Arizona Inn 2200 E. Elm St. RSVP Required: (520) 7702131 or www.visitTucson. org/PartnerRSVP Cost: $25 MTCVB Partners; $30 Others NAWBO Monthly Mixer Third Thursdays 4 to 7 p.m. Locations vary Info: info@nawbotucson.org NAWBO Monthly Breakfast Fourth Tuesdays, 8 to 9:30 a.m. Locations vary Info: Morella Bierwag, (520) 326-2926 or info@ nawbotucson.org

Vantage West can help you grow your business. Whether you want to build a new office or warehouse, expand your current facilities, purchase equipment or a fleet of vehicles, we can help. We have money to lend to qualified businesses, and because all loan applications are reviewed right here in Tucson, you’ll get a decision quickly. Call us.

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18 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

FINANCE YOUR MONEY

Principles from yoga and what they can teach about investing It’s probably not on your calendar, but World Yoga Day is Sunday (Feb. 24). As people have discovered its healthful benefits, yoga has grown in popularity. But whether or not you practice yoga, you can apply its lessons to other areas of your life — including investing. Specifically, consider the following yoga-related themes and how they might translate into investment habits that may be beneficial: • Balance If you observe advanced yoga practitioners, you will be amazed at the balance they exhibit during certain positions. But for serious yoga students, the idea of “balance” goes beyond physical movements and extends to a concept of life that emphasizes, among other things, an avoidance of extremes. As an investor, you too need to avoid extremes, such as investing too aggressively, too conservatively or too sporadically. By building a balanced portfolio, and by investing regularly, you can help improve your chances of making progress toward your financial goals. • Flexibility Among its many benefits, yoga helps people increase their flexibility — and greater flexibility results in fewer injuries and an increased capacity to enjoy many physical activities. As an investor, you need to be flexible enough to adjust your portfolio as needed while still following a long-term strategy that’s appropriate for your individual goals, risk tolerance and time horizon. • Relaxation For yoga students, proper relaxation is essential to achieving mental equanimity, emotional balance and inner strength. But relaxation doesn’t always come easily — even experienced yoga practitioners need to work at it. As an investor, you also may need to train yourself to relax because, given the ups and downs of the market, it’s not hard to become overwrought and make ill-advised decisions based on short-term events.

Staying calm and maintaining a long-term view of things may help you make better investment decisions. • Positive thinking Our own thoughts and TIM BEITHON actions are largely responsible for creating our happiness and success, according to yoga teachings. And positive thinking can play a key role in investing, too. For example, if you were to constantly look at negative headlines, you might conclude that it is pointless to invest for the future because external events — economic instability abroad, political squabbles at home, natural disasters and so on — will just disrupt your plans. Consequently, you might decide not to invest, or invest in such a way that can make progress toward your financial goals difficult. But if you maintain a positive attitude, you may be more inclined to invest wisely for your future. • Visualization In yoga, visualization is often used to reduce stress. At any given time, you might find it difficult to relax, but you can use your imagination to see yourself — and put yourself — in a relaxed state. As an investor, you need to visualize your goals, such as a comfortable retirement, before you can define a strategy to help you work toward them. By seeing yourself where you want to be, you’ll be motivated to take the actions necessary to work toward getting there. Try putting the principles of yoga to work — they may help you become a better investor.

Contact Tim Beithon, a financial advisor with Edward Jones, at Tim.Beithon@ edwardjones.com or (520) 546-1839. Beithon’s office is at 9525 E. Old Spanish Trail, Suite 111.

TUCSON STOCK EXCHANGE Stock market quotations of some publicly traded companies doing business in Southern Arizona

Company Name

Symbol

Feb. 20

Feb. 13 Change

52-Week 52-Week Low High

Tucson companies Applied Energetics Inc CDEX Inc Providence Service Corp UniSource Energy Corp (Tucson Electric Power)

AERG.OB CEXIQ.OB PRSC UNS

0.04 0.07 18.07 46.52

0.04 0.07 18.51 46.42

0.00 0.00 -0.44 0.10

0.03 0.01 9.56 35.20

0.12 0.51 19.67 47.19

8.76 2.51 2.52 11.80 62.14 10.01 100.22 17.25 58.55 4.28 23.84 43.22 40.95 41.18 47.90 16.50 101.08 33.93 51.85 13.82 86.45 72.22 21.93 32.22 36.13 66.44 70.35 199.31 34.67 61.42 5.60 48.61 35.73 18.03 46.57 27.67 1.30 37.18 38.64 43.34 60.88 39.51 39.72 39.60 53.26 66.04 20.19 18.60 54.05 57.55 20.13 48.85 47.90 13.39 11.43 44.52 39.50 62.65 18.34 33.06 53.23 26.08 134.72 19.13 13.33 33.85 69.21 41.60 35.10 13.20 24.14

9.10 1.30 2.69 12.17 62.78 10.29 97.97 15.12 57.90 4.07 24.50 44.00 40.13 41.71 46.81 16.34 101.63 41.69 51.06 14.78 87.29 71.61 23.83 35.64 36.51 67.45 70.18 200.09 34.51 61.44 5.50 48.68 36.79 19.82 46.60 28.46 1.36 40.83 39.77 44.08 61.88 39.96 41.18 42.56 53.22 65.76 19.61 20.23 53.97 55.71 20.74 49.53 47.62 13.24 11.61 45.02 39.45 62.69 18.58 33.72 52.85 26.19 135.29 19.05 14.66 33.93 71.39 41.48 35.13 13.29 24.74

-0.34 1.21 -0.17 -0.37 -0.64 -0.28 2.25 2.13 0.65 0.21 -0.66 -0.78 0.82 -0.53 1.09 0.16 -0.55 -7.76 0.79 -0.96 -0.84 0.61 -1.90 -3.42 -0.38 -1.01 0.17 -0.78 0.16 -0.02 0.10 -0.07 -1.06 -1.79 -0.03 -0.79 -0.06 -3.65 -1.13 -0.74 -1.00 -0.45 -1.46 -2.96 0.04 0.28 0.58 -1.63 0.08 1.84 -0.61 -0.68 0.28 0.15 -0.18 -0.50 0.05 -0.04 -0.24 -0.66 0.38 -0.11 -0.57 0.08 -1.33 -0.08 -2.18 0.12 -0.03 -0.09 -0.60

7.97 0.36 1.48 6.72 50.95 5.30 78.18 11.20 50.89 2.97 14.97 24.61 28.09 20.71 22.19 12.13 81.98 32.05 43.08 8.42 51.11 50.27 13.45 30.54 21.38 46.12 52.21 181.85 27.10 53.38 3.94 30.83 27.96 6.46 41.35 20.98 1.06 22.01 24.76 37.99 53.18 32.31 33.93 24.07 41.11 56.59 15.69 7.63 49.03 38.63 14.73 33.03 38.40 6.25 7.76 39.01 25.77 52.25 14.04 26.06 33.62 17.45 104.08 18.36 6.78 28.26 57.18 28.53 29.80 7.80 17.45

10.75 2.94 3.13 12.42 64.79 10.57 101.49 27.95 60.00 4.93 24.86 44.71 42.00 42.98 49.49 17.50 105.97 43.43 52.77 14.90 89.98 73.25 24.66 44.74 37.74 68.15 71.43 211.79 37.70 64.47 5.85 49.68 38.62 20.04 55.25 28.80 1.81 43.22 39.98 44.21 62.83 42.17 41.84 44.85 53.96 71.25 42.05 21.97 59.34 57.89 22.94 49.70 85.90 13.93 11.76 46.08 42.55 65.80 18.95 34.29 53.90 26.84 138.00 52.80 15.64 35.46 77.60 42.00 36.60 13.54 24.92

Southern Arizona presence Alcoa Inc (Huck Fasteners) AA AMR Corp (American Airlines) AAMRQ Augusta Resource Corp (Rosemont Mine) AZC Bank Of America Corp BAC Bank of Montreal (M&I Bank) BMO BBVA Compass BBVA Berkshire Hathaway (Geico, Long Cos) BRK-B* Best Buy Co Inc BBY BOK Financial Corp (Bank of Arizona) BOKF Bombardier Inc* (Bombardier Aerospace) BBDB CB Richard Ellis Group CBG Citigroup Inc C Comcast Corp CMCSA Community Health Sys (Northwest Med Cntrs) CYH Computer Sciences Corp CSC Convergys Corp CVG Costco Wholesale Corp COST CenturyLink (Qwest Communications) CTL Cvs/Caremark (CVS pharmacy) CVS Delta Air Lines DAL Dillard Department Stores DDS Dover Corp (Sargent Controls & Aerospace) DOV DR Horton Inc DHI Freeport-McMoRan (Phelps Dodge) FCX Granite Construction Inc GVA Home Depot Inc HD Honeywell Intl Inc HON IBM IBM Iron Mountain IRM Intuit Inc INTU Journal Communications (KGUN 9, KMXZ) JRN JP Morgan Chase & Co JPM Kaman Corp (Electro-Optics Develpmnt Cntr) KAMN KB Home KBH Kohls Corp KSS Kroger Co (Fry's Food Stores) KR Lee Enterprises (Arizona Daily Star) LEE Lennar Corporation LEN Lowe's Cos (Lowe's Home Improvement) LOW Loews Corp (Ventana Canyon Resort) L Macerich Co (Westcor, La Encantada) MAC Macy's Inc M Marriott Intl Inc MAR Meritage Homes Corp MTH Northern Trust Corp NTRS Northrop Grumman Corp NOC Penney, J.C. JCP Pulte Homes Inc (Pulte, Del Webb) PHM Raytheon Co (Raytheon Missile Systems) RTN Roche Holdings AG (Ventana Medical Systems) RHHBY Safeway Inc SWY Sanofi-Aventis SA SNY Sears Holdings (Sears, Kmart, Customer Care) SHLD SkyWest Inc SKYW Southwest Airlines Co LUV Southwest Gas Corp SWX Stantec Inc STN Target Corp TGT TeleTech Holdings Inc TTEC Texas Instruments Inc TXN Time Warner Inc (AOL) TWX Ual Corp (United Airlines) UAL Union Pacific Corp UNP Apollo Group Inc (University of Phoenix) APOL US Airways Group Inc LCC US Bancorp (US Bank) USB Wal-Mart Stores Inc (Wal-Mart, Sam's Club) WMT Walgreen Co WAG Wells Fargo & Co WFC Western Alliance Bancorp (Alliance Bank) WAL Zions Bancorp (National Bank of Arizona) ZION Data Source: Dow Jones Market Watch *Quotes in U.S. dollars, except Bombardier is Canadian dollars.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

19

INSIDE REAL ESTATE & CONSTRUCTION

Construction of ‘spec’ homes jumps in January By Roger Yohem Inside Tucson Business As the region’s real estate market continues its uneven recovery, new home builders have increased the number of “spec” homes being built. Known as speculative construction, these houses are built in advance on the idea that a buyer will be found later. Although a positive sign that housing is improving, it’s also a warning flag of caution because the region is still struggling with a fragile, sluggish economy and some 600 new foreclosure notices each month. Last September, builders had 142 spec homes in inventory, which was a 1.22-month supply at the time, according to housing analyst Ginger Kneup of Bright Future Real Estate Research. As of Feb. 1, builders had 203 specs available, a 1.61-month supply based on current sales. “We are hopeful that speculative building remains in check. We will keep close watch on that number to see how it squares with demand,” Kneup said. In January, 189 single-family permits were issued in the region, including 15 approvals for custom homes. The “lion’s share” of permits were issued in the northwest side submarket “along the Tangerine Road corridor anchored by Gladden Farms to the west, Rancho Vistoso to the east, and Dove Mountain in the center,” Kneup said. “This corridor will dominate activity in 2013,” she added. Since the beginning of the year in that submarket, Meritage Homes has opened three new communities, Lennar two and PulteGroup one. At Gladden Farms, Kneup said about 500 lots are platted “in varying states of readiness for delivery to builders.”

THE PULSE: Median Price Active Listings New Listings Pending Sales Homes Closed

TUCSON REAL ESTATE

2/11/2013

2/4/2013

$152,299 5,123 423 427 199

$135,850 5,112 443 268 126

Source: Long Realty Research Center

Reuter received the President’s Award for Excellence, and Liz Parker was Administrative Employee of the Year. The Winner’s Circle Brokerage Awards were presented to Rob Glaser as No. 1 Producer; Rick Kleiner as No. 2 Producer; and Russ Hall as No. 3 Producer. The Divisional Highest Producers were: Bob Kaplan in multi-family; Rob Tomlinson in retail; Kleiner in office; and Glaser in industrial. Property Management Awards honorees were Mona Deane as manager of the year; Debbie Ramsey as MVP; and Linda Montes-Cota for tenant relations.

TUCA honorees Shawn Cote

Mark McLear

In January, the average price of a new home was $265,933, the highest level since early 2008. That is $3,301 increase since December. The median sales price dropped almost $16,000, falling to $224,408 in January from $240,265 in December. “Builders will be challenged to deliver product in this price range as finished lot prices climb, building material costs edge up and the new increased minimum wage puts upward pressure on labor costs,” said Kneup. “Expect to see some retooling of product in response to inflationary pricing pressures in order to meet demand in the entry-level segment.” Last month, D.R. Horton Homes pulled 35 permits, the most permits in the region, followed by Lennar at 31.

Serving the region’s lending industry, SAMLA is a chapter of the Arizona Mortgage Lenders Association.

McLear heads SAMLA The Southern Arizona Mortgage Lenders Association (SAMLA) has named Mark McLear, senior loan officer at Fairway Independent Mortgage Corp., as its 2013 president. McClear’s office is at 5401 N. Oracle Road. Joining McLear on the board of directors are Randy Hotchkiss, Hotchkiss Financial; Jackie Atkins, Wells Fargo Home Mortgage; Lisa Burns, Fidelity National Home Warranty; Karmin Laramie Lynam, Commerce Bank of Arizona; Rodney Bell, Fairway Independent Mortgage; Maggie Sheridan, Washington Federal; and Mike Omiecinski, Chase Mortgage Bank.

WEEKLY MORTGAGE RATES Program 30 YEAR 15 YEAR 5/1 ARM

Current

Last Week

3.50% 3.625% 3.50% 3.625% 2.88% 3.125% 2.88% 3.125% 2.63% 2.875% 2.63% 2.875%

2/19/2013

1 Year 12 Month 12 Month Ago High Low 4.95% 4.22%

The above rates have a 1% origination fee and 0 discount . FNMA/FHLMC maximum conforming loan amount is $417,000 Conventional Jumbo loans are loans above $417,000 Information provided by Randy Hotchkiss, National Certified Mortgage Consultant (CMC) Hotchkiss Financial, Inc. P.O. Box 43712 Tucson, AZ 85733. (520) 324-0000. MB #0905432. Rates are subject to change without notice based upon market conditions.

4.95% 4.22%

3.38% 2.75%

SAHBA adds associate Shawn Cote, former government affairs director for the Southwest Montana Building Industry Association, has been named government affairs associate for the Southern Arizona Home Builders Association (SAHBA). His duties include coordinating and managing SAHBA’s government relations efforts throughout Pima County and its four municipalities. At the Montana association, Cote managed state and local political and public policy initiatives. Cote has been involved with the home building industry for more than 20 years and holds a political science degree from Montana State University. SAHBA represents about 350 businesses serving the region’s home construction industry.

CBRE honorees The Tucson office of CBRE honored five of its commercial real estate professionals as the division’s top performers of 2012. The recognition is based on leadership and production, said Ike Isaacson, managing director of the Tucson office. The honorees and their specialties are: W. Michael Sandahl and John Ash, who work selling investment properties; Buzz Isaacson and David Montijo, who work selling in the office sector; and Nancy McClure, in retail.

Picor honorees Cushman & Wakefield/Picor Commercial Real Estate Services honored employees for their achievements in 2012, which the company said was its best year since 2008. Revenues were up 27 percent over 2011, “a positive sign for market momentum,” said president Michael Hammond. In the Company Awards category, Barbi

The Tucson Utility Contractors Association (TUCA) bestowed awards on members and affiliates in acknowledgment of their service to the organization. Special recognition was given to Maggie Mozingo, Precision Tool, and Tony Pedroza, Tucson Recycling and Waste Services, who were granted Lifetime Member status. TUCA also honored: Jim DeGrood, with the Regional Transportation Authority, as Person of the Year; Tom Kilargis, Pima County Transportation Department, as Agency/Municipal Member of the Year; Tim Schutte, Earhart Equipment, and Mozingo as associate members of the year; and Todd Adams, Trinity Southwest, as Ditch Digger of the Year. The Ben Patton Luster Award for safety was presented to Granite Construction, Trinity Southwest and Southwest Gas.

Sales and leases • Preferred Packaging & Crating Inc. leased 20,000 square feet at 845 E. Ohio St., Suites 111 and 113, from Ashland Group, represented by Brandon Rodgers, Stephen Cohen and Russell Hall, Picor Commercial Real Estate Services. The tenant was represented by Rob Glaser, also with Picor. • Lawrence Sherrill leased 11,821 square feet at 420 E. Aviation Drive, Suite 130, from Rich Rodgers Investment. The transaction was handled by Brandon Rodgers, Picor Commercial Real Estate Services. • Presson Midway LLC, 4500 E. Speedway, leased space to the following: 2,400 square feet in Suites 61-62 to IDN-West; 1,600 square feet in Suite 11 to Guardvant Inc.; 1,200 square feet in Suite 54 to Shelli Industries; 1,200 square feet in Suite 55 to Polly Spencer; and 1,067 square feet in Suite 7 to Maxit Systems. Guardvant Inc. was represented by Andrew Sternberg, Oxford Realty Advisors, all the other transactions were handled by Rob Glaser and Paul Hooker, Picor Commercial Real Estate Services.

Email sales and leases and other real estate news items to ryohem@azbiz.com. Inside Real Estate & Construction appears weekly.


20 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

EDITORIAL BIZ BUZZ

What makes a person buy a particular car? I’m not a shopper. I generally buy things when I have to. I get no kick out of walking around a bunch of stores or surfing the Internet. For some items, there are shortcuts. But not for cars. I’m not saying that’s bad. In fact, having just gone through it, there’s something to be said for a transaction that involves a certain amount of genuineness. Really. I wrote before that the vehicle that DAVID HATFIELD had dutifully serviced my needs for 15 years and had given me every indication we would see its odometer click over to 200,000 miles sometime next year decided to call it quits. The head gasket blew and it was immoveable. On the advice of my mechanic and the help of our son and his wife, we sold it in less than 48 hours. The car-buying experience took longer. I was prepared financially but my commute is long by Tucson standards — about a half-hour — and as my boss, publisher Tom Lee told me, “You don’t want to put commute miles on a car you want to keep for a while.” But now I had to venture out. This was just after Sam Williams, who writes the Sales Judo column in Inside Tucson Business, had done a piece on the reputation of car salesmen. I found plenty who are nowhere near the stereotype. Then again, I found some who are having trouble shaking the old ways. I was amazed that apparently there are still customers who look at a car, consider its performance, interior appointments and styling and then say, “You know what this thing could use? A pair of pinstripes down the side. And I’m willing to pay $200 to get them.” My disdain for shopping also prompted me to do something that probably wasn’t a smart move. I told every sales person I met I was looking for their best price. I’m not a haggler. I must not have made that point clear or car people simply didn’t believe it. I had read things like Consumer Reports and had an idea of where pricing should be and simply discarded those that suggested I pay more than the sticker price. I wound up going to seven dealerships, either because of advertising or reputations that had made me want to buy a particular make of car. Every sales person I came across was polite and pleasant. There was only one instance where I was truly disappointed in the car itself from the test drive — worst of all, it was a sales person I really liked. There are intangibles. For instance, I wanted to buy my car in Tucson. I earn my money here and, except for vacations or business trips, I’ll spend my money here. Considering the quarterly reports from the auto industry are a significant gauge of how the economy is doing and that millions of dollars are spent on advertising, the final link to close a sale is the relationship between a customer, the sales person and the dealership — either in person or online. In the end, the car I bought wasn’t my first choice. I like it. I like it a lot.

Contact David Hatfield at dhatfield@azbiz.com or (520) 295-4237.

EDITORIAL

At last, a positive check-up The difficulty with living through historic or lifechanging moments is that you don’t notice or feel them so much as they’re happening. It’s only in looking back and analyzing a situation and its ramifications that the significance can be recognized. As we all continue to look for signs of a recovering economy, the special section in last week’s (Feb. 15) issue of Inside Tucson Business reviewing Tucson commercial real estate sectors and how they fared in 2012 offered solid glimmers of positive trends. Under a recurring theme of “good enough,” it might not have seemed like much for those who were accustomed to the way things were before the Great Recession. But let’s face it, the word “good” hasn’t been a part of the lexicon for Tucson real estate in five years. Thanks to the University of Arizona’s plans to grow student enrollment by another 10,000 to 50,000 by the end of the decade, student housing developments are driving the recovery in commercial real estate, at this point with nine projects in various stages of planning or construction and due to be completed by 2014. Even more impressive, major U.S. firms that in the past would have skipped over Tucson are involved in these developments. Along with the residential developments come the ancillary support services and infrastructure, not the least of which is Sun Link, the modern streetcar that will connect the UA area with downtown and everything in between. We continue to hear from naysayers who argue the streetcar doesn’t do anything for them. For those who say that, this may come as a shock but the streetcar is not for you. Right now, Sun Link is a linkage for students who are going to be the immediate force behind the growth of consumer spending in this region. In due time, that will expand and more of the rest of us might become users of things such as Sun Link. Going hand-in-hand with the projected growth is the state of Tucson’s retail sector. As was noted in Inside Tucson Business’ end-of-the-year review in December,

the fact that revitalization of downtown is actually happening – after 40 years of fits and starts – was the region’s biggest news event last year and much of that has to do with investments by retailers. The revitalization of an old Mervyn’s store at the northeast corner of Broadway and Craycroft Road into the Benenson Retail Center was the single-biggest event in the retail real estate market in terms of capital improvements. There were also major retail commercial real estate transactions – including the $125.4 million sale of the Tucson Spectrum Center, at Interstate 19 and Irvington Road, and the $29.5 million sale of The Corner, at Oracle and Wetmore roads – that show renewed confidence in the region. There were even a few significant transactions of land for housing developments. While home building is still years away – if ever – from returning to the time when it was the backbone of Tucson’s economy, the land sales are positive indicators. Signs weren’t so positive in the office sector of commercial real estate but that has as much to do with the uncertainties coming out of Washington, D.C., as it did anything locally. And the sector for industrial space is primed and ready to deliver, just as soon as a manufacturer or user is ready to expand. Yes, the commercial real estate special section was like an annual physical by a doctor covering numerous important points. In this case, the doctor was reporter Roger Yohem, who orchestrated the compilation of information that provided a status check on the region’s economy through commercial real estate. The prognosis: the pulse is beginning to beat harder, color is coming back and vital signs are improving. It’s going to take time to become healthy once again but at long last the positive signs are there. We all know now the Great Recession was something of historic proportion. We can now also begin to see that at long last, there are signs it is coming to an end.


InsideTucsonBusiness.com

FEBRUARY 22, 2013

21

OPINION WAKE UP, TUCSON

TUSD school board member could have shown courage, but didn’t Some 15,000 students have either moved out of Tucson Unified School District, open-enrolled in another district or are taking refuge in a charter or private school. This plunge in enrollment has helped to contribute to a $17 million shortfall in TUSD. Over the last couple of months, the TUSD school board has been taken over by the Adelita Grijalva crew, which includes Kristel Foster and the soon-to-be famous Cam Juarez. This G-Team usually gets most concerned over students chaining themselves to desks at a board meeting in support of ethnic studies rather than trying to find ways to teach the other 53,000 students in the district how to read, write, calculate and maybe get into Pima Community College with something more than an 8th grade understanding of what they’re supposed to know. For the next budget cycle, TUSD is aiming to bludgeon the already-raw TUSD teaching staff. In a memo, Chief Financial Officer Yousef Awwad told teachers to expect the following adjustments: • An increased personal contribution to their health plan. • Fewer vacation and substitute hours. The net result will be to work more for

less take-home pay that in part will go to pay for administrative overhead that sucks $158 more per pupil out of a classroom than the average for other districts in the state. The TUSD CHRIS DESIMONE board has taken steps to shut down 11 schools, which will save the district about $4 million. That leaves only $13 million more to go. But a minor miracle occurred when Mr. Juarez voted along with Mark Stegeman and Michael Hicks to authorize staff to investigate the possibility of outsourcing some of the support operations to see if TUSD could save money while maintaining, or improving, service to students and teachers. It seemed liked a reasonable idea worth checking out. But outsourcinig is a dirty word to the local political machine. A machine to which Ms. Grijalva is an heir. When you see public management as a machine employment agency, outsourcing is an erosion of

influence, not a smarter way to do business. On Feb. 12, two weeks after the initial vote, Mr. Juarez folded like a cheap suitcase, said he changed his mind and voted against pursuing the outsourcing investigation. One can only imagine what Ms. Grijalva and the machine must have done to poor Mr. Juarez. Did they strap him to a chair a la “Clockwork Orange” forcing him to watch a Honey Boo Boo marathon? Did they make him read the Collected Works of Newsletters by City Councilman Steve Kozachik? Whatever. In only his second month on the board, it already looks as if Mr. Juarez is more worried about his future political career than providing the leadership TUSD students and teachers desperately need. On Bill Buckmaster’s radio show Feb. 15, Mr. Juarez said he was worried about the social consequences of outsourcing and the effect on the district’s blue collar workers. A populist argument, but ignorant. For example, if TUSD were to outsource transportation — one of the biggest — there is no way the hundreds of personnel it takes to operate the district’s fleet of school buses could be replaced. Most employees would be re-hired and work for a company that would operate the system.

Yes, some who are not performing may not get a job but wouldn’t it be a good thing to have the best men and women serving our children and teaching staff? No one can argue that a privately owned operation under a competitively bid contract wouldn’t out-perform a function done by a government entity. This could be especially true for one of the poorest-run school districts in Arizona, as determined by the state Auditor General. TUSD is in the hole to tune of up to $17 million. A federal judge has ordered the district resume teaching “culturally relevant” courses. Teachers who are already underpaid are being asked to do more and earn less. And no less than 18 schools in the district have been given “D” grades by the Arizona Department of Education. Do that three times and the school gets an “F” and is subject to being taken over by state authorities. Cam Juarez could have shown leadership and done something to change that for the benefit of 53,000 students. He didn’t.

Contact Chris DeSimone at provenpartner@comcast.net. DeSimone co-hosts “Wake Up Tucson,” 6-8 a.m. weekdays on The Voice KVOI 1030-AM.

GUEST OPINION

My retirement rave, minus the exciting fireworks Editor’s note: Nic Clement, who has been superintendent of Flowing Wells Unified School District since 2004 and contributed opinion pieces to these pages over those years, announced in January that he is retiring at the end of the school year, June 30. The Flowing Wells School Board has appointed Associate Superintendent David Baker to succeed him. Baker began his tenure with the district as a teacher in 1991. Baker has also been an elementary and junior high school principal. When I first announced my retirement after 30 years with Flowing Wells Schools, I got a number of “congrats and now you can say anything you want to the media” emails. I decided to take their advice, but If you were expecting a rant like the “go to your window” scene from the movie “Network,” this column will be more use to you in house training your new puppy. Knowing that a good retirement speech is like fireworks — memorable, bright and colorful explosions, and over fast, I will light the fuse on my retirement rave. During my tenure, I have been incredibly fortunate to experience the profound

evolution of K-12 schools. Walk the campus of schools today and you see expert teachers engaging students in relevant and rigorous activities. You see higher enrollments in NIC CLEMENT Advanced Placement courses with more students earning college credit than any time I can recall. You hear questions like this one a fifth grade student recently developed for her science fair project: “Does the angle of a basketball shot (when using a set distance) affect the success rate of the number of baskets made?” You feel a tear slip down your cheek as you watch a talent show put on by more than 50 special needs students. Listen to leaders in large and small businesses, faith-based organizations, and volunteer groups tell you how they have stepped it up in supporting schools and you will ooh and ahh louder than the end

of any fireworks show you have ever seen. Science camps sponsored by IBM, tutoring from Literacy Connects, and faith-based groups doing school makeovers are just a few ways our partners make a real difference in students’ lives every day. Visit a parent night and you won’t see five or six parents spread around the auditorium as the principal makes a sleep-inducing speech about school rules. Parents are coming to schools in droves because principals, teachers, and staff give out and then fire up sparklers, specific hands-on science, math and reading strategies designed to help parents help their children succeed in school and life. This year, Flowing Wells High School had 300 parents attend “bring your parent to school week,” an event that would have been considered a dud and a sure misfire 20 years ago. Elected officials and other state and national policy makers have come together to make some exciting fireworks of their own. I remember as a young kid waiting for that highest, loudest and brightest skyrocket. The adoption of the Arizona Common

Core Standards along with a transition from AIMS to the Partnership for Assessment of Readiness for College and Career Readiness (PARCC) test is that skyrocket. Along with the emails wanting me to rant, I also received a number asking about my legacy. Recently, I was doing a site visit at Richardson Elementary School with Principal Lyle Dunbar. Each semester, I spend a day at each of our district’s schools walking with the principals visiting every classroom with the intent to observe and stay grounded in our primary mission, teaching and learning. As we walked into a kindergarten class, a student stopped writing looked up and said “Hey Mr. Dunbar, who is your little friend?” That nailed it. I want to be remembered as a good “little friend.”

Contact Nic Clement, superintendent of the Flowing Wells United School District, at clementn@flowingwells.k12.az.us


22 FEBRUARY 22, 2013

INSIDE TUCSON BUSINESS

OPINION SPEAKING OUT

EPA’s clean air rule could send CAP rates sky high The Central Arizona Project (CAP) canal brings Colorado River water from Lake Havasu to Pima, Pinal and Maricopa counties. Nearly 95 percent of the electricity needed to deliver that water comes from one power plant, the coal-powered Navajo Generating Station. The U.S. Environmental Protection Agency (EPA) has proposed new requirements to install nitrogen oxide (NOx) emission controls at the generating station near Page. According to the EPA, “NOx reacts with other chemicals in the air to form ozone and fine particles; both are associated with asthma, bronchitis, emphysema, and even premature death.” The EPA’s proposal is intended to reduce emissions by 84 percent, which help clear the air for tourists, including those visiting the Grand Canyon, less than 20 miles away. But the new federal regulations would greatly increase the costs for operating the Navajo Generating Station by requiring the installation of a NOx control system called Selective Catalytic Reduction. The costs are estimated at more than $1 billion. Costs that would be passed on to the CAP’s water customers. This could result in unemployment for a

great many Navajo and Hopi tribal members if the generating plant had to close because the emissions standards could not be met. It might also make farming using CAROL WEST Colorado River water too costly for the Native Americans and others to continue that vocation. Using precious groundwater for agriculture is unsustainable. In a news release, the EPA and U.S. Departments of Energy and Interior said they will work together to “support Arizona and tribal stakeholders in finding ways to produce clean, affordable and reliable power, affordable and sustainable water supplies, and sustainable economic development while minimizing negative impacts on those who currently obtain significant benefits from the Navajo Generating Station.” It is crucial to control the noxious emissions because of the power plant’s proximity to national parks, monuments,

and wilderness areas. But it’s not as if steps haven’t already been taken to curtail the emissions. In the 1990s, power plant owners spent $400 million installing scrubbers to remove gasses that can cause acid rain. In 2008, in an effort to improve visibility in the region, owners began installing low nitrogen burners to reduce emissions of smog-forming NOx. The project, which cost $46 million, was completed in 2011. The CAP, whose service area includes 80 percent of the state’s population, is the biggest user of electricity in Arizona. There are good reasons for this. Water in the canal flows for 336 miles from Lake Havasu to the terminus south Tucson, at an elevation 3,000 feet higher than where it started. It takes nine large pumping stations just to pump the water up to Tucson from Phoenix. CAP officials have worked closely with state and federal elected officials, the Bureau of Reclamation, Salt River Project, Native American tribes, and other stakeholders to bring to the EPA’s attention the potential impacts of their new emissions rule to our water delivery system and its power generating station. EPA seems to have heard the pleas.

InsideTucsonBusiness.com Have you checked out our new People in Action section?

The EPA’s proposal gives the plant until 2023 to install new controls to achieve the emissions limit. EPA requested that affected interests present other options that could establish longer timeframes for installing pollution controls to: 1. Satisfy the Clean Air Act requirements 2. Still meet stakeholders’ needs. CAP officials say they are “encouraged by the EPA’s recognition of the significant impacts this ruling has on CAP and its customers, Arizona’s Native American tribes that have settlement agreements including substantial amounts of CAP’s Colorado River allocation, and the financial impacts to the Navajo and Hopi tribes.” However, CAP General Manager David Modeer says, “We remain concerned that the EPA’s regulatory solution of the rule as it stands doesn’t address the full economic impacts to CAP and its customers.” Nonetheless, Modeer affirmed that CAP will continue to work with EPA for a resolution.

Contact Carol West at cwwtucson@ comcast.net. West served on the Tucson City Council from 1999-2007 and was a council aide from 1987-1995.

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Inside Tucson Business 02/22/13  

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