Inside Tucson Business 08/17/12 by Territorial Newspapers

PIPELINING TECHNOLOGY Startup Tucson brings tech community together PAGE 4

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UA RESEARCHERS DEVELOPING SUPER CAMERA CAPABLE OF CAPTURING BILLION-PIXEL COUNT IMAGES | PAGE 14

Back on track Union Pacific Railroad project moving forward Page 5

Navigating the skies Universal Avionics technology making flying easier Page 13

From pastprime to prime-time 40-year-old hotel is an Aloft comeback Page 19

Regulatory worries blunt effects of record-low mortgage rates By Roger Yohem Inside Tucson Business Since the sub-prime mortgage meltdown of 2008, Tucson’s housing market has slowly clawed its way back to a level of modest stability. Since then, 27,000 distressed foreclosures have been cleared out. Annually, sales have risen from a low of 10,500 homes to almost 13,500 last year. For the past three months, the median sales price has held at $140,000. That is 12 percent higher than in July 2011. And with home mortgage rates now at historic lows, the financial incentive to refinance or buy is a tempting enticement.

Yet with the positive momentum, there are economic factors holding back home buyers, including new federal regulations that have created caution and uncertainty among lenders. Specifically, mortgage and banking officials are still sifting through details in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The act “has had a clamping down effect on commercial banking as well as mortgage lending,” said Randy Hotchkiss, a certified mortgage consultant and president of Hotchkiss Financial. “The act started the clock on hundreds of required rule makings, half of which will impact commercial or residential mortgage lending. I under-

stand the reason for the law because lax underwriting is what got our industry in trouble. What I don’t like are the unintended consequences,” he said. More government control brought about more mortgage licensing requirements. That increased business costs and decreased the number of loan originators in Arizona by 40 percent. Further, the federal government’s new Consumer Finance Protection Bureau mandates that loan originators be limited to flat-fee compensation. That regulation is expected to force small mortgage companies out of business. “Clearly, the industry is already

headed there” as Wells Fargo, JPMorgan Chase and US Bancorp have made half of all home loans this year, he said. The fourth player is Bank of America. “Together, I believe Dodd-Frank and Consumer Finance Protection Bureau will drive everyone out of the mortgage origination business except the large commercial banks. It’s all about more government control through regulation. It’s easier to control four big banks than hundreds of little mortgage companies.” Randy Hotchkiss’ guest opinion on mortgage reform appears on page 22 on this week’s Inside Tucson Business.

2 AUGUST 17, 2012

SBA Lending Getting the right business financing is key in today’s economy. A Wells Fargo SBA loan is a smart choice, because the low down payment and low monthly payments help you maintain capital and cash flow. If you’re looking to purchase real estate for your business, acquire another business, expand to an additional location, or simply buy equipment or inventory, turn to Wells Fargo SBA Lending to help you do it. You can be confident in our experience as an SBA lender. In 2011, we approved over a billion dollars in SBA loans to businesses across America — more than any other bank in SBA lending history.2 We’ll use that experience to guide you through the process and make sure you get the financing you need. Apply for a loan or learn more today. Stop by a Wells Fargo location to talk with a banker, or call 1-800-545-0670 (Monday – Friday, 7 a.m. – 7 p.m. Pacific Time). You can also visit wellsfargo.com/sba.

Wells Fargo is the #1 SBA 7(a) lender by dollars according to the U.S. Small Business Administration as of September 30, 2011. Based on data from U.S. Small Business Administration, for federal ﬁscal year 2011. All credit decisions subject to approval. © 2012 Wells Fargo Bank, N.A. All rights reserved. Member FDIC. (709199_04421)

INSIDE TUCSON BUSINESS

Proud to be America’s #1 SBA lender for the 3rd straight year 1

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AUGUST 17, 2012

NEWS

Mayor takes debut trip to Guaymas, Hermosillo; turns focus south to promote Tucson as trade hub

Mayor Rothschild explains his interests in promoting Tucson in Mexico to reporters at Hotel Playa de Cortes in Guaymas. The mayor is flanked (left) by Luis Felipe Seldner of Tucson’s The Offshore Group and, right, by Antonio Astiazarán, a federal deputy from Sonora and a past mayor of Guaymas.

By Keith Rosenblum Inside Tucson Business GUAYMAS, SONORA — Eight months into his first term, Tucson Mayor Jonathan Rothschild took his first trip to this port city — with plans to go to the nation’s capital —to learn for himself how Tucson can emerge as a logistics hub for trade with Mexico. “The establishment of Guaymas as a major port means Tucson increases in prominence as a logistics hub for a very large and prosperous region,” Rothschild said. Throughout his stay, the mayor practiced the “toque personal” (personal touch) in a flurry of meetings and conferences with the Sonoran press. The 57-year-old lawyer spent much of Tuesday (Aug. 14) meeting with a cross-sec-

tion of businessmen and legislators whom, he believes, have the influence to push for further development of Guaymas as an arrival and disembarking point for trade with much the southwestern United States and north of Mexico. Rothschild also stressed how the growth of Sonora carries direct economic benefits for Tucson’s hospitality and retail industries. Tucson has always opened itself up to visitors from Mexico and we want to extend a “welcome any way we can,” Rothschild said. The mayor estimated that Mexicans spend $1 billion annually in Tucson. “Three of my staff members have immediate relatives living in Sonora and we know first-hand just how important it is to treat visitors with warmth and courtesy,” he said. The mayor’s trip came about in an unlike-

ly fashion - as the result of his counterpart up Interstate 10. When Mayor Greg Stanton of Phoenix, who has been in office for as long as Rothschild, received an invitation to visit Hermosillo and Mexico City, he essentially invited Rothschild along for the ride. During his campaign, Rothschild emphasized the importance of tourism and trade with Mexico. Since taking office, he had made it clear that he “wanted to be a participant and not merely an observer of the relationship with Mexico,” said Felipe Garcia, executive vicepresident of the Metropolitan Tucson Convention & Visitors Bureau, who accompanied the mayor. “He wants to actually work to create opportunities for Tucson companies.” That is when The Offshore Group, a

See MAYOR | Page 6

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Inside Tucson Business (ISSN: 1069-5184) is published weekly, 53 times a year, every Monday, for $1 per copy, $50 one year, $85 two years in Pima County; $6 per copy, $52.50 one year, $87.50 two years outside Pima County, by Territorial Newspapers, located at 3280 E. Hemisphere Loop, Suite 180, Tucson, Arizona 85706-5027. (Mailing address: P.O. Box 27087, Tucson, Arizona 85726-7087, telephone: (520) 294-1200.) ©2009 Territorial Newspapers Reproduction or use, without written permission of publisher or editor, for editorial or graphic content prohibited. POSTMASTER: Send address changes to: Inside Tucson Business, P.O. Box 27087, Tucson, AZ 85726-7087.

Biotech firm Accelr8 to move HQ to Tucson Accelr8 Technology Corporation, a publicly traded firm that develops instruments used for the detection of pathogenic microorganisms, announced Thursday it is moving its corporate headquarters to Tucson from Denver. The announcement made at the offices of Tucson Regional Economic Opportunities (TREO) was touted by the economic development agency as the kind of firm that will make Tucson a leading hub in the biotech industry. Accelr8 will build out wet labs and occupy about 15,000 square feet of space in the 180,000 square-foot, four-story Pima County Herbert K. Abrams Public Health Center, 3950 S. Country Club Road, near the University of Arizona Medical Center - South Campus (formerly Kino Hospital). The Board of Supervisors is scheduled to approve a lease next week and the company anticipates it can be operational by early next year. Accelr8 plans to fill 65 positions over the first three years in Tucson with the potential to grow to more than 200 employees later. Among the headquarters positions are engineers, scientists, sales and marketing, management, finance, quality control and regulatory and manufacturing. The decision to move to Tucson came after what was described as a multi-state process. “Accelr8 is developing a revolutionary product in the diagnostics area and we were impressed with the region’s emerging bioscience strength, innovation and support that can help ensure our future success,” Accelr8 President and CEO Lawrence Mehren said in a statement. Mehren, who became president and CEO in June, formerly was head of global business at Roche Group’s Ventana Medical Systems where he been since 2007. The company is in development on its BACcel rapid diagnostic system which it says is the first technology able to count and identify dangerous pathogens and their drug resistance expression within the same day of obtaining a patient specimen, rather than waiting two to three days under standard methods. The speed allows for a significant improvement in the treatment of the more than 1.7 million people in the U.S. who contract a hospital acquired infection each year. Founded in 1982, Accelr8 trades on the New York Stock Exchange under the ticker symbol AXK.

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

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Briefs People in Action Finance Real Estate & Construction Biz Buzz Editorial Classifieds

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4 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

NEWS Absent any new legal action, neighborhood opposition to a new Walmart Supercenter at El Con Mall likely has ended, clearing the way for construction to begin. There was no legal appeal filed by the Aug. 6 deadline to contest a Pima County Superior Court ruling that allows for construction to go forward. The El Encanto Estates Neighborhood Association had sought to invalidate a 2000 development agreement between the City of Tucson and the mall’s owners. The July court ruling upheld the mall’s protected development rights and affirmed the Walmart proposal conforms to the city’s zoning regulations. “We expect to begin construction in the fall once the necessary site work is complete. Grand opening is now projected for late 2013,” said Delia Garcia, media director for Wal-Mart. “We are excited to be part of the continued revitalization of El Con Mall and to offer midtown residents a convenient option for affordable groceries, general merchandise, and pharmacy services.” The new store is to be built at the west end of the mall, 3601 E. Broadway, replacing a store built in the 1960s, originally as a Levy’s department store. It had been vacant since its last occupant, Macy’s, closed it in 2008.

City Wide Restoration lands on Inc 500 list City Wide Restoration Inc., 5602 E. Spring St., made this year’s Inc. 500 list of the fastest growing private companies in the U.S. It was the only Tucson firm to make the list. The list is made up of private, for-profit, independent companies. To be eligible for this year’s list, companies had to have generated at least $100,000 in revenue in 2008 and at least $2 million in revenue in 2011. Ranking No. 471 on the list, City Wide Restoration, which provides restoration for damaged properties and equipment rentals, reported $2.3 million in 2011 revenues and grew by 814 percent over three years. Zach Fraic is CEO of City Wide Restoration. The company was founded in 2006 and has 16 employees. The companies on the list will be honored Oct. 3 at the Inc 500/5000 Conference and Awards Ceremony to be held at the Marriott Desert Ridge Resort and Spa in Phoenix.

Seeing double last week of Inside Tucson Business Many Inside Tucson Business subscribers received two copies of the Aug. 10 issue due to problems associated with printing out the mailing labels. Circulation Manager Laura Horvath said it was an error involving many but not all subscribers. Obviously, customers won’t be charged for the additional issue.

Building the pipeline: Local group wants to create more community in Tucson tech By Patrick McNamara Inside Tucson Business Fueled by coffee, beer and adrenalin, about three dozen techies pulled an allnighter Aug. 10 at Spoke6 trying to develop a mobile app. The group had gathered at Spoke6, 439 N. Sixth Ave., as part of a Startup Tucson’s Hackathon. “It’s a good way to get to other people,” said John Gruenenfelder, one of 35 attendees making up the nine teams who labored through the night in an effort develop a saleable mobile app. Meeting people was the point, according to Justin Williams, founder of Startup Tucson and a management information systems doctoral student at the University of Arizona. But more than simply putting people with similar interests in the same room, Williams said the goal was to build a symbiotic community among techies and creative young people from all quarters of the Tucson region. “The tech community is very fragmented,” Williams said. He said the greater Tucson tech community has been divided into silos at places like the University of Arizona and a few centers of industry. Williams said the goal of an event like the Hackathon is to bring people out of the silos and tap into the potential of the community of creative classes. “There’s a lot of innovation that goes on here,” Williams said of the Tucson area. “But we don’t translate that into new ventures the way other areas do.” Groups like Williams’ Startup Tucson and others have long sought to build Tucson into a center for technology and industry similar to California’s Silicon Valley, Boston, Austin, Texas, or some emerging centers such as Boulder, Colo. But Williams said there’s a lot Tucson could learn from a place like Omaha, Neb., which has quietly been establishing itself as a capital of technology startups. “We are looking a lot at Omaha,” Williams said. “It’s a world hub of the financial services.” The city also has seen a recent boom in tech-related startup companies. Plus, Omaha seems to have embraced the benefits of collaboration and the joining of various tribes of digital nation. An annual startup conference called Big Omaha has, since its inauguration in 2008, grown to attract nearly 1,000 attendees from across the United States and several countries. Some of the speakers at this year’s Big Omaha included Seth Goldstein, who co-

Robert Alcaraz

Sans appeal, construction of El Con Walmart to start

Chris Hill, right, looks over Oscar Gomez’s shoulder as he works on his Startup Tucson Hackathon project.

founded the website Turntable, and Jim McKelvey, one of the founders of the webpayment system Square. “We’ve got a good share of Fortune 500 companies here,” said Jeff Slobotski, one of the founders of Big Omaha and the regional tech news website Silicon Prairie News. “We’re trying to build on those assets we have here.” Slobotski said the success of events like Big Omaha and the efforts of the many entrepreneurs of the region have helped to put the city on the map. In many ways, Omaha and Tucson are similar. According to the most recent U.S. Census, Omaha has a population of 409,000 to Tucson’s 520,000 and both have similar age demographics. But Omaha has a considerably higher median household income of $46,230 to Tucson’s $37,000. The city also has a lower percent of people living below the poverty line, 15.3 percent to 21.3 percent in Tucson. Nebraska has, however, ranked consistently low on the lists of states attracting venture capital funding and well below the amount of funding to come into Arizona each year. That appears to have begun to change though, with some major players like Capricorn Investment Group setting up shop there. Slobotski said more angel funding groups and venture firms have been showing an interest in Omaha and the tech community has started to coalesce more. “Our goal is: how do we help to build a community in this ecosystem,” he said.

Events like the Tucson Hackathon can serve to bring the diverse parts of the local tech community together in an effort to build what Williams calls “the pipeline.” The Hackathon served as the first stage in building that pipeline — the development of a prototype. Next, developers can bring their prototypes and other more fully formed ideas to Startup Tucson’s planned Startup Weekend, Sept. 7 through 9, where they will get a chance to recruit team members. From there, the teams will refine their design and plans and work on customer development strategies. Teams later will present their ideas to an expert panel that will provide guidance and strategies to move the products from the planning to development stages. The teams also can participate in Startup Weekend and later get the chance to receive intensive entrepreneurial training and mentoring at the Arizona Center for Innovation. Among the nine prototype apps developed during the Hackathon, a panel of judges voted an app called Neighborhood Chef the one with the most potential. Developed by Brennan Washburn, it’s designed to help private chefs manage menus for members of their food clubs. Registration for Startup Tucson’s next event, Startup Weekend, is underway. Those interested in attending can find more information at startuptucson.com.

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

InsideTucsonBusiness.com

AUGUST 17, 2012

NEWS

Union Pacific track layers on track for Tucson project By Alan M. Petrillo Inside Tucson Business Union Pacific Railroad’s long-running project to run a double main line track from Los Angeles to El Paso — right through Tucson — continues to move forward, with work expected to begin on the second track in Pima County before the end of the year. Zoe Richmond, Arizona public affairs director for Union Pacific, said railroad work crews are currently laying the second track in several areas of Pinal County and expect to move their work zones into Pima County in the near future. Union Pacific started the double tracking project in 2005 and considerable progress was made until the recession caused a slow down in demand for shipping goods. Richmond said the project slowed down accordingly and was stopped in 2010 because of the economy. It began again last year and is approximately 65 percent complete, she said. Most of the double track for the project is scheduled to be laid in Arizona. Union Pacific trains have been using some sections of the second track, Richmond said, which has made scheduling and transit times more efficient. Second track sections currently in use have been completed in Texas and New Mexico, and are partially done in California and Arizona. According to the railroad, 981 miles of rail and 4.1 million rail ties were laid in 2011. Specific figures for Arizona are not separated out. Union Pacific has 642 miles of track in the state, and originated 21,916 rail cars in Arizona last year and terminated 96,881 rail cars in the state. Union Pacific, which has 45,000 employees nationwide, operates in 23 states in the western two-thirds of the country, and is celebrating its 150th anniversary this year. It employs 1,289 people in Arizona with an annual payroll of $101.6 million. It reported capital spending in Arizona in 2011 of $113.3 million, and in-state purchases totaling $101.6 million. Union Pacific informational materials show that its trains are able to move one ton of freight approximately 500 miles on one gallon of diesel fuel, the equivalent of a mid-sized automobile weighing 2½ tons getting 200 miles per gallon. The railroad says a single train, which

can take up to 300 trucks off highways, generates a carbon footprint an average of 75 percent less than trucks. Freight coming through Arizona on Union Pacific trains is diversified and includes agricultural, automotive, chemical, energy and industrial products, as well as intermodal freight service to Mexico. Typical products shipped via Union Pacific south of the U.S. border are raw materials such as aggregates, cement, roofing, lumber, pipe, sheet steel, beams, scrap metal, sand, lime, clay and waste, as well as finished goods like military equipment, household appliances, generators and wind turbine components. The other major Union Pacific project in Arizona is a proposed switching yard at Red Rock near Picacho Peak, but the effort to build the yard is on hold while the Arizona State Land Department considers the railroad’s request to acquire 900 acres of state trust land. The switching yard is planned to be sited northeast of Union Pacific’s current right of way and west of West Kodial Road, across from the Rooster Cogburn Ostrich Ranch. The property being sought by Union Pacific is about 6 miles long and approximately a mile wide. Richmond said the railroad needs a plot of land that is greater in length than width because it needs room for locomotives and trains to decelerate and stop safely, and then accelerate to get back onto the main line. Union Pacific can’t project a date for when construction would begin because that depends on procuring the land first, and then on how the economy is performing, Richmond noted. “The State Land Department is reviewing economic and technical studies that we submitted to them where they can get to the point they’re comfortable with the rail facility,” she said.

Maria Baier, land commissioner, said the consideration of Union Pacific’s application is progressing and that the department is reviewing the drafts of two consultant reports on engineering and economic assessments. “We have to make sure the project is a beneficial use of the trust land beyond the immediate sale to Union Pacific,” Baier said. She noted that the economic study would shed light on whether the sale of the 900 acres might have a negative impact on other state trust land in the area. Baier pointed out that the economic assessment investigated how other sections of land (a section is 640 acres) nearby might be affected by freeway access, water supply, wastewater capacity, drainage costs and internal transportation needs. “We want to maximize revenue to the trust, but also be sure that in making the sale, we’re not making all the other state trust land nearby unsalable, foreclosing on opportunities for those other lands,” she said. The State Trust Department manages 1.2 million acres of trust land in Pinal County, where the proposed rail yard would be located.

This Week’s

Good News 11 year-old Tucsonan has White House lunch date Eleven year-old Haile Thomas of Tucson will be having lunch Monday (Aug. 20) at the White House. She got there because of her recipe for Quinoa, Black Bean and Corn Salad. Thomas and 53 other junior chefs had their recipes selected from among 1,200 entries in a contest that was part of first lady Michelle Obama’s “Let’s Move” initiative to encourage healthy eating. The Monday event is billed as a “Kids State Dinner.”

The Tucson

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

Controversy in El Paso Despite the growing likelihood the Triple-A Tucson Padres will be bought by an El Paso business group and moved there in 2014 to a new $50 million ballpark to be built downtown that will require the demolition of City Hall, there is also opposition to the move — or at least to how fast everything is moving there. This week the El Paso City Council voted to put a measure on the Nov. 6 ballot asking that the city’s bed tax — they call it a hotel occupancy tax — be increased by 2 percent to 17.5 percent to help pay for the ballpark. City officials there had been talking about raising the tax long before the idea surfaced to build the ballpark. Opponents of the ballpark are circulating petitions to demand that city officials put a direct question on the ballot as to whether the ballpark should be built. El Paso and MountainStar Sports, the group that wants to buy the Padres, have already signed an agreement guaranteeing city funding of the ballpark so if the tax increase fails in November, presumably the city would have to come up with other funding. The tax increase isn’t the only money item on El Paso’s ballot. The city is also asking voters to approve selling $473 million in bonds for “quality of life” improvements to the city’s parks, the zoo, museums, libraries and construction of a new multipurpose performing arts center.

Controversy in Scottsdale You may have heard that a hot issue in Scottsdale these days is the city’s consideration of lifting a 40-year-old ban on ice cream trucks. Don Henninger, publisher of the Phoenix Business Journal, notes this controversy arises at the same time a new coffee shop is opening in Scottsdale has decided that for its competitive edge, it will use waitresses wearing bikinis.

6 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

MAYOR Continued from Page 3

PUBLIC NOTICES Selected public records of Southern Arizona bankruptcies and liens.

PUBLIC NOTICES Business bankruptcies, foreclosures and liens recorded in Tucson or Pima County and selected ﬁlings in Phoenix. Addresses are Tucson unless otherwise noted.

BANKRUPTCIES No ﬁlings for businesses

FORECLOSURE NOTICES DD Boys LLC 5820 S. Nogales Highway 85706 Tax parcel: 138-10-023A Original Principal: $120,000.00 Beneﬁciary: Charles C. Yessian and Margaret Yessian, trustees of Yessian Living Trust, and Invegstar Inc. Auction time and date: 10 a.m. Oct. 30, 2012 Trustee: Title Security Agency of Arizona, 2730 E. Broadway, Suite 100

LIENS Federal tax liens Anthony’s Heating & Cooling Inc., 10911 E. Limberlost Road. Amount owed: $6,816.00. Solar Industries and Solar Industries Inc., PO Box 27337, 85726. Amount owed: $2,629,105.07. Chopstix Fine Asian Dining II LLC and Hein Ma, 8225 N. Courtney Page Way, Suite 129, Oro Valley. Amount owed: $1,387.69. Ordinary Bike Shop Inc., 4224 E. Fourth St. Amount owed: $2,628.00. IBA Associates LLC, 2450 N. Pantano Road. Amount owed: $29,455.64. Southern Arizona Air LLC and Basharat Mahmood, 702 E. Fair St. Amount owed: $17,055.09. Security Insurance and HR Solutions Inc., 3580 W. Ina Road, Suite 150, Marana. Amount owed: $13,528.61. Systems Service Inc., PO Box 8522, 85738. Amount owed: $3,098.15. E&S Janitorial Service and Evalinda T. Huerta, 4431 N. Calle Llanura. Amount owed: $8,905.14. SAB Enterprises LLC and Shari Bracamonte, 4956 S. 12th Ave. 2. Amount owed: $3,724.88. Innovative Landscapes Inc., 7709 N. Jensen Drive. Amount owed: $2,198.93. Angulo’s Affordable Rooﬁng LLC and Socorro Angulo, 2787 W. Calle Arandas. Amount owed: $21,857.34. Family Air LLC and James Beard, 2021 E. 12th St. Amount owed: $23,873.77.

State liens (Liens of $1,000 or more ﬁled by the Arizona Department of Revenue or Arizona Department of Economic Security.) Abbey Flooring Center and Navlin Inc., 4844 E. Speedway. Amount owed: $40,177.24. Nick’s Place Inc., 7156 S. Highway 92, Hereford. Amount owed: $1,131.08.

Mechanic’s liens (Security interest liens of $1,000 or more ﬁled by those who have supplied labor or materials for property improvements.)

Groundskeeper against QIP Tucson Ofﬁce I LLC. Amount owed: $17,186.00. Tucson Winnelson Co. against Villa Fatima Oro Valley LLC and Marbar Plaza LLC. Amount owed: $6,830.25. Border Group of Companies Inc. against QIP Tucson Ofﬁce I LLC. Amount owed: $115,332.60. Air Specialty Products against Marana Health Center Inc. Amount owed: $3,113.00.

Release of federal liens Cavalier Express LLC and Scott G. Miller, 16121 S. Delgado Road, Sahuarita Steve Reno Inc., 7956 E. Nicaragua Drive Cattletown Steakhouse and John R. Kocis, 3141 E. Drexel Road Pathﬁnder Construction LLC, PO Box 280, Litchﬁeld

Guaymas-based company with 14,500 employees in Mexico and about 150 in the U.S., including Tucson, became aware of the trip. Company executives invited the mayor to Guaymas ahead of the Hermosillo trip. Their efforts, in turn, were complemented by Roberto Lemmen Meyer, the new owner of Tucson’s KUDF-LP, Channel 14, whose Spanish-language programming comes from Azteca America. Lemmen Meyer’s wide-spread commercial interests include the Marinaterra Hotel & Spa in San Carlos, a tourism community adjacent to Guaymas, where the mayor and his party stayed. The mayor toured the Roca Fuerte industrial park owned by Offshore and visited Sargent Controls & Aerospace assembly facility. He chose Sargent because it also has operations in Marana. Companies such as Sargent themselves are the best judges of what jobs can be performed in which country, the mayor explained, and said it was myth that Mexican companies are taking away jobs from the U.S. On the contrary, he said, jobs sent to Mexico are most likely jobs that might otherwise go to China and would produce no benefit for Arizona. Said Luis Felipe Seldner Jr., son of the Offshore partner: “There are 2,000 highly paid engineers now living in the GuaymasEmpalme area. Do you know where many of them go to shop and to entertain themselves? It’s Tucson.” Offshore has offices on Tucson’s southeast side where it handles shipment, billing, marketing and Customs functions. The company estimates that last year it paid duties on $1.5 billion in merchandise. It is one of several dozen “shelter” programs, operating under the assumption that foreign companies want to devote themselves exclusively to manufacturing in Mexico without taking on the legal obligations and infrastructure of a Mexican corporation. Operating under the shelter plan costs companies 25- to 30-percent more per manhour, but absolve the companies of hiring, compliance and other non-manufacturing functions. Offshore now has 67 companies at its Empalme, Guaymas and Coahuila facilities. The company also has recently opened a call center staffed by 40 engineers in Guadalajara to support a software firm. The mayor’s delegation included Maricela Solis, business advocate; Joe Snell, president of the Tucson Regional Economic Opportunities Inc., (TREO); Mike Hammond, president and managing shareholder of PICOR Commercial Real Estate; Fletcher McCusker, chairman and chief executive of Providence Service Corp. and a member of the Downtown Tucson Partnership; and Garcia.

NEWS

Mayor Rothschild, hosted by Luis Felpe Seldner of Tucson’s The Offshore Group, views products manufactured at one of 67 manufacturing operations housed at the firm’s Maquilas Teta Kawi subsidiary in Guaymas and Empalme,Sonora.

Brent DeRaad, president of the MTVCB, was scheduled to join the mayor in Mexico City. Among the most important presentations made to the group was that of port director, Jose Luis Castro Ibarra, who told the mayor about the variety of goods now passing through the port. Wheat from the U.S. northwest, agriculture products from Texas and New Mexico, and minerals from Arizona and elsewhere are now regularly dispatched from the port. A wide range of bulk products have been supplemented this year for the first time by container shipments, Castro said. Some two-thirds of containers arriving in U.S. ports from Asia now go back empty, Castro said, while containers leaving Guaymas are going back full. The Guaymas port dispatches goods through several U.S. ports of entry, including those in California and Texas, but principally through Nogales. One of the major impediments to increased traffic from Guaymas to the U.S. is the absence of inspection equipment at the U.S. port of entry in Nogales, the mayor was told. One solution: Have the U.S. Customs and Border Protection, or CBP, inspect freight in Guaymas and then have trains “electronically sealed” until their entrance into the U.S. The Guaymas port is going to experience major expansion plans in 2013 and 2014, the group was told, but the Mexican officials said they were forbidden from making the plans public for the time being. The mayor and his delegation were treated to a lunch at the San Carlos home of one

of Offshore’s partners, Luis Felipe Seldner. The two other partners, Roberto Gómez del Campo and Felix Tonella, both with farreaching interests in Sonora, also attended. The mayor met at the Seldner residence with Claudia Pavlovich, one of two popularly elected senators from Sonora and a member of the Institutional Revolutionary Party, or PRI, to which incoming President Enrique Peña-Nieto belongs. The mayor also met Antonio Astiazarán, a congressman-elect and former mayor of Guaymas; Rogelio Díaz-Brown, mayor-elect of Ciudad Obregón, Sonora’s second largest city; Rafael Cabllaero, the 89-year-old founder of San Carlos; and Juan Fernando Healy, publisher of El Imparcial, the state’s largest paper. The mayor left for Hermosillo on Wednesday (Aug. 15) morning where he and Mayor Stanton, also a Democrat, met with Javier Gándara, mayor of Hermosillo, and Sonora Gov. Guillermo Padrés Elias, also a PAN member, who is in the fourth year of a six-year term. They were scheduled to meet Thursday (Aug. 16) with mayor-elect of Hermosillo, Alejandro Lopez Caballero, a member of the opposition National Action Party, or PAN. Lopez Caballero, a former state treasurer, is scheduled to begin his three-year term on Sept. 12. In Mexico City, Rothschild is scheduled to meet with U.S. Ambassador E. Anthony Wayne; executives of American Express Vacations; representatives of AeroMéxico and US Airways; and the federal Secretary of Tourism.

Correction Due to a problem receiving complete information, not all of Larsen Baker’s shopping centers were included in the List of shopping centers that appeared in the Aug. 10 issue. A modiﬁed List of the largest shopping centers will appear in the Aug. 31 issue and the complete List will appear in the 2013 Book of Lists when it is published in January.

InsideTucsonBusiness.com

AUGUST 17, 2012

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8 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

SALES SALES JUDO

About those deceptive and aggressive sales tactics of for-profit colleges Perhaps you saw the news from U.S. Sen. Tom Harkin, D-Iowa, on for-profit colleges and how they go about their business and recruiting (sales) practices. And there was Gary Trudeau’s “Doonesbury” comic strip in which a president of nonprofit Walden College and his dean ponder current events: President: (looking at a sheet of paper) “What am I looking at, Dean?” Dean: “Our graduation rates, sir…we’re now down to 18 percent of students graduating in four years. 65 percent never graduate at all.” President: “Good God…can these numbers be right?” Dean: “Afraid so, sir.” President: “So, we have a graduation rate as bad as for-profit colleges?” Dean: “Well, maybe not quite that bad… remember, for-profits take any warm body with federal aid. They’re all about enrollment, not completion. And why not? Last year taxpayers sent the failure factories $32 billion!” President: “What are you saying? We should turn pro?” Wry humor aside, the Harkins’ Senate report states that on average 54 percent of students enrolled in 30 for-profit colleges for the 2008-2009 academic year had withdrawn by the summer of 2010 without earning a degree. A sample of those enrolled via online campuses withdrew at significantly higher rates: 68 percent in programs for associate degrees; 57 percent for bachelor degrees, and 59 percent in certificate programs. It should be noted that it appears online accounts for a significant amount of the dropout rate. But, according to the report, much of the blame is laid at the feet of the recruiters — the sales staff — of the for-profits who lure in, mislead and bilk tens of thousands of unsuspecting prey. Wow! I never knew we salespeople were that good! We’re not. Allow me to explain why many of the

reasons students who don’t matriculate have nothing to do with deceptive or manipulative sales practices.

SAM WILLIAMS

Baseline ‘natural’ dropout rates

As I pored through the charges in the report, I was reminded that it took me one false start and eight long years to earn my BA degree. I’m pretty sure I wasn’t “conned” into enrolling at my first university and signing up for my college loan. The enrollment criteria were stringent. I think the average grade point average of entering students was at least 3.7 and the average SAT score was at least 650. One out of seven applicants was admitted. The point is that we were academically well prepared and should have sailed through the program. I was shocked when, as a second-day freshman, we were addressed by our university president, who told us, “Look to your left. Look to your right. One of you will not graduate!” In this case, he wasn’t trying to “wash” anyone out of school. He just knew that roughly one-third of us weren’t sufficiently mature to successfully manage the challenging experience at this particular stage of our lives. So right there we may have accounted for as much as 33 percent of the 54 percent of students who drop out. They’re just not yet mature enough. If you add the impact of online courses, the “natural” dropout rate may be as high as 40 percent, leaving just 14 percent to explain.

‘Forced’ dropout rates There are some institutions or programs that do try to “wash out” under-qualified or underperforming students. Take the military, for example. When I was enrolled in Officer Candidate School, the wash-out rate was

about 60 percent. Similarly, according to the book “Chosen Soldier, the Making of a Special Forces Warrior,” the wash-out rate for highly qualified candidates during their selection program is also about 70 percent. Other major causes Clearly for-profit colleges aren’t trying to wash out students, so there must be other factors contributing to students’ early departures. According to a 14-year veteran recruiter in the for-profit college industry, the biggest factor she encountered was the combination of being a single parent, having to work while being enrolled as a student and lacking a sufficient support structure. These three pressures are very hard to cope with over any length of time, and the pressures to drop out are enormous. However, she continued, many single parents do cope with these pressures and succeed. She cited the example of a young single mother who, at 4-feet 8-inches and weighing less than 100 pounds, started work on the loading dock of a mining company. She hadn’t completed high school. Her managers noticed her initiative and intelligence and moved her into an accounting role in which she flourished. They then offered to pay for accounting courses at a community college, where she also excelled. The first time that she sat for the certified public accountant exam, she passed. She is now the controller of a company. The recruiter said that, even though the dropout rate may be high for this type of student, success stories like this one should counterbalance any prejudice to exclude them from the opportunity to enroll.

Aptitude and preparation Another factor the recruiter mentioned was inadequate educational preparation. Everyone she recruited had to pass the Wonderlich Cognitive Personality Test. This popular instrument is used to assess the aptitude of prospective employees and students for their basic knowledge and problem-solving skills. She said when a recruiting department, rather

than an independent admissions team, administered the test, there might be efforts to help a test taker pass by allowing more time, for example. We may have accounted for a significant fraction of the 54 percent who drop out and none of its has anything to do with recruiter malfeasance. Sen. Harkins’ report cites these deceptive and misleading practices: • Lead generation. The report details the fact that recruiters of for–profit colleges obtain lists of leads they then contact via phone, mail and email. In some cases they even pay for leads! • Targeting of markets. The report states that for-profit recruiters target and prey on members of our military because they are recipients of the GI Bill or they have government employment. They are also accused of targeting those who would be the first in their families to receive a degree or those in low-paying, entry level jobs who want to win jobs that pay more. • Investigating for pain and desire. Recruiters are accused of manipulating candidates by identifying and magnifying candidates’ fears and dreams. • Financial incentives to mislead applicants. Recruiters are also accused of providing false employment figures and earnings potential, as well as concealing or understating the total costs of their programs because doing so is to their economic advantage. In my next column in the Sept. 7 issue, I’ll take on the nefarious practices of these despicable recruiters.

Contact Sam Williams, president of the business-to-business sales consultancy firm New View Group, at swilliams@newviewgroup.net or (520) 390-0568. Williams is also an adjunct lecturer of sales at the University of Arizona Eller School of Management. Sales Judo appears the first and third weeks of each month in Inside Tucson Business.

InsideTucsonBusiness.com

AUGUST 17, 2012

OUT OF THE OFFICE ARTS & CULTURE

MEALS & ENTERTAINMENT

While tooling around So. AZ, A few things worth seeing before fall arts season hits stop at Pizzeria Mimosa With the heat we’ve had of late, a sightseeing drive may not be top of mind. But should you find yourself in the area of the San Pedro Riparian National Conservation Area south of Sierra Vista allow me to suggest a stop at Pizzeria Mimosa in Hereford. Instead of following the mantra “location, location, location,” Pizzeria Mimosa owners Vicki and Wendell Gilbert decided on “food, ambience and novelty.” The Gilberts built their restaurant literally from the ground up and it has been open about eight months. The restaurant is large, bright with contemporary decor. The Italian food menu features antipasti, pasta, piatti (entrées), insalata, paninis and pizze. The pizzas are 12 inches in diameter and they’re pedigreed. All 14 varieties are made adhering to the standards set by the Vera Pizza Napoletana organization, which promotes the art of pizza making as it has been done in Naples, Italy, for more than 200 years. In addition to fresh cow’s milk mozzarella, Pizzeria Mimosa makes its tomato sauce from imported Italian plum tomatoes and the dough from Antico Molino Caputo flour, which is milled near Naples. Then the pizzas are cooded in about two minutes in an 800-degree wood-burning stove, imported from Naples, of course. In addition to a dining room, Pizzeria Mimosa has two patios and a soon-to-becompleted private dining facility. The restaurant is open 11 a.m. to 9 p.m. Sundays through Thursdays and 11 a.m. to 9:30 p.m. Fridays and Saturdays. To get there take State Highway 92 south through Sierra Vista and turn left on Hereford Road, go for about two miles it should on your left.

Pizzeria Mimosa makes an ideal stop on a trip to Bisbee. Or make it part of a daytrip that includes wine country around Sonoita. One of my favorite stops on the way back MICHAEL LURIA would be Dos Cabezas Wine Works on State Highway 82 just east of the intersection with State Highway 83. Not only does Dos Cabezas have some of the best in Arizona wines, you’ll likely have the added pleasure of chatting with winery owners Todd and Kelly Bostock. • Pizzeria Mimosa, 4755 E. Neapolitan Way, Hereford — www.pizzeriamimosa. com — (520) 378-0022

Final 2 Primavera Cooks The Primavera Cooks Summer fundraising dinner series has two more dinners remaining — Pastiche Modern Eatery Aug. 29 and Le Rendez-Vous Sept. 5. The dinners cost $125 per person of which $50 is tax deductible with proceeds going to support Primavera’s efforts to provide pathways out of poverty through safe, affordable housing, workforce development and neighborhood revitalization. • Primavera Cooks! — www.primavera. org/html/supportus/cooksdinners.html — (520) 623-5111 est. 101.

Contact Michael Luria at mjluria@ gmail.com. Meals & Entertainment appears weekly in Inside Tucson Business.

EVERY MORNING DAILY NEWS — DELIVERED TO YO YOU! OU!

S FREE TO

The slow days of summer are about to end with the arrival of a busy and diverse arts season that gets going full steam in late September. Until then, here are some other great options for the coming week.

Art A new exhibit of photographs opens this weekend at the Center for Creative Photography, 1030 N. Olive Road on the University of Arizona campus. The show, titled “Made In Arizona: Photographs from the Collection,” runs until Nov. 25. Created in honor of the state’s centennial, this selection of images is limited to photographs created in the state during the last 100 years. The show will be a great way to experience a small portion of the vast collection at the Center for Creative Photography. Open from 9 a.m. to 5 p.m. weekdays. Admission to the exhibit is free.

Music Community radio station KXCI 91.3-FM is continuing its annual tribute celebrating the music of 40 years ago with a fund-raising concert featuring the music of 1972. Performers who will do cover songs from the year include Mik Garrison doing Stevie Wonder, Run Boy Run doing a tribute to Levon Helm, Roll Acosta doing Al Green, Nancy McCallion doing Johnny Nash, Crosscut Saw doing the Allman Brothers, Boreas doing Randy Newman, and Chris Holiman’s Downtown Saints doing Neil Young. The all-ages concert starts at 5:30 p.m. Aug. 25 at the Rialto Theatre, 318 E. Congress St. Tickets are $10 each in advance or $15 the day of the show. Under age 12 are free with an adult.

Film It’s another busy week for new films with seven new offerings and the return of an annual fan favorite at the Loft Cinema. This week, Disney’s “The Odd Life of HERB STRATFORD Timothy Green,” a family friendly flick about an odd child who comes to a family via the garden, opened on Wednesday. Also for families this week is “ParaNorman,” a stop-motion, animated film which features a character who can see the dead and must protect his town from a vengeful witch. Also new in the multiplexes is “Sparkle” with Jordin Sparks and the late Whitney Houston, in a drama about an all-girl Motown group in the 1960s, and “The Expendables 2” with the aging cast of action stars back for more explosions. Loft Cinema, 3233 E. Speedway, presents fan favorite “Spike and Mike’s Sick and Twisted Festival of Animation 2012” today through next Thursday (Aug. 23) and includes the Sundance Film Festival favorite “Queen of Versailles,” which details the construction of the largest home in America. Also at the Loft, at 7:30 p.m. Wednesday is a one-night-only screening of the documentary “Paul Williams Still Alive” that chronicles the current activities of the pop sensation from the 1970s. This movie and “Queen” are excellent films that should not be missed and have already made it onto my “best of 2012” list.

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

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10 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

MEDIA

Ratings show audiences are tuning out political talk radio By David Hatfield Inside Tucson Business Just as this year’s election season is getting cranked up with this month’s primary elections, by one measure — radio ratings — public interest in politics has diminished compared to what it was two years ago. Among 29 local and national radio talkshows airing weekdays on five Tucson radio stations, 15 of them — including some of biggest names — are averaging fewer listeners this year than they did in 2010, according to data compiled from the radio ratings company Arbitron. And in most cases, the declines weren’t small — the average drop was 36.5 percent. There were exceptions. Glenn Beck’s audience from 3-6 p.m. weekdays on KNST 97.1-FM/790-AM has grown by 19.1 percent since 2010; Sean Hannity’s audience from noon-3 p.m., also on KNST, was up about a half percentage point; Mark Levin’s audience from 7-10 p.m. on the Truth KQTH 104.1-FM was up a whopping 119 percent and comedian/Libertarian Phil Hendrie’s show from 10 p.m.-1 a.m. on the Star KWFM 1330-AM was up 100 percent (though as a late-night show that amounted to 400 listeners). But the biggest exception to the downturn is NPR affiliate KUAZ 89.1-FM/1550-AM, where audiences are up for seven of its eight daytime informational shows. In fact, among the five local stations, KUAZ is the only one where its overall average was up — in this case, 24.8 percent — from 2010. KUAZ’s biggest gainer was “NPR Morning Edition,” which was up 4.97 percent to an average of 9,133 listeners, from 6,100 two years ago. Among the other stations, Clear Channel’s KNST with its line-up of the biggest names in conservative talk radio was off a comparatively small 7.2 percent, Journal’s the Truth was down 34.2 percent, Good News’ the Voice KVOI 1030-AM was off 13.6 percent and locally-owned KWFM, which features many liberal voices, was down 57.7 percent. It can be argued that compared to the other stations, NPR has fewer purely political broad-

casts but then that only further bears out a point that radio audiences may be tiring of politics. Rush Limbaugh is still the big fish when it comes to talk radio with an average Tucson audience of 12,965 people listening to his show but even his audience is down 10 percent from an average of 14,465 two years ago. In some cases the declines can be explained due to extenuating circumstances. For instance the ratings of Jon Justice’s morning show on the Truth took a hit — he was the market’s second most popular host two years ago and fell to No. 17 this year — and it probably had something to do with his being either off the air or recovering from his second open heart surgery for six weeks of the three-month rating period that ran from March 29 to June 20. As the Truth’s franchise player, that could have had an impact on the ratings for the station’s entire line-up. Research has long showed that media consumers quickly tire of political news which is why outlets tend to put off coverage until it’s close to Election Day. In TV for instance, Nielsen Media Research, allows stations to exempt election night coverage from their news ratings averages due to the unpredictability of the coverage but also because viewing on election night tends to be lower. But radio, particularly AM radio, found success in providing political talk. At least until now.

Wildcats football A sure sign the summer dolldrums are about to be behind us: footballs are in the air — and on the air. And this year there’s the added new arrival Wednesday of the Pac 12 Networks — Pac 12 Arizona can be found on Cox Cable channels 75 and 1075 for high definition, on Comcast channels 103 and 598 (HD) and Western Broadband channels 76 and 776 (HD). Sorry, no deal with either DirecTV or Dish Network as of launch day although Pac-12 officials say diligent negotiations with both satellite providers are ongoing. Comcast customers who subscribe to its

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sports tier programming will also have access to the standard definition version of the Pac12 national network on channel 283. Included in the Pac-12 networks’ first week of programs are half-hour football previews of each school in the conference. The UA preview is scheduled for 7 p.m. Sunday (Aug. 19). Viewers with access to the Pac-12 Arizona network should see every University of Arizona football game this season, one way or another. Each Pac-12 home game will either be on ABC (KGUN 9), Fox (KMSB 11), one of the ESPN networks, FX or the Pac-12 Networks. Additionally, cable customers with access to the Pac-12 networks will be able to sign-up for computer, smartphone and tablet access to programming at no additional charge. The sign-up is through the cable carrier’s “TV Everywhere” platform. So far five Wildcats’ games have been set for TV, the first four games under new head coach Rich Rodriguez and the season ender against Arizona State: • 7:30 p.m. Sept. 1 at home against Toledo on ESPNU • 7:30 p.m. Sept. 8 at home against Oklahoma State on Pac-12 Arizona • 7:30 p.m. Sept. 15 at home against South Carolina State on Pac-12 Arizona • (Time to be determined) Sept. 22 at Eugene against Oregon will be on either ABC, ESPN or ESPN2 • 8 p.m. Nov. 23 at home against ASU on ESPN On radio, the Wildcats network and line-up of affiliates remains the same as last year with the Source KCUN 1290-AM as the flagship station and live football game coverage also on KHit KHYT 107.5-FM. If you’re traveling around the state, games can also be heard in Phoenix on KFNX 1100-AM, Sierra Vista on KTAN 1420-

AM, Douglas on KDAP 96.5-FM, SaffordThatcher on KWRQ 102.3-FM, Globe on KIKO 1340-AM and in the Show Low-Lakeside-Pinetop are of the White Mountains on KVWM 970AM. The games are broadcast in Spanish ESPN Deportes KTKT 990-AM in Tucson and XENY 760-AM in Nogales, Sonora.

More football On Aug. 30 Comcast is adding another new channel called ESPN Goal Line. It will be on channel 281 as part of the sports tier. Basically it’s a college football version of the NFL’s Red Zone channel giving viewers live look-ins of games in progress usually as one team gets into a scoring situation. It operates on Saturdays from 9 a.m. to 9 p.m. (until the rest of the country goes off Daylight Saving Time, when it will operate an hour later). The channel fires up again during college basketball season as ESPN Buzzer Beater and operates on Wednesdays and Saturdays. And when you’re out and about and want to put NFL coverage on autopilot, there’s radio. Once again the Source KCUB 1290-AM will carry the Arizona Cardinals including tonight’s 7 p.m. pre-season game against the Oakland Raiders. KNST 97.1-FM/790-AM is adding live broadcasts of all Dallas Cowboys games this year starting with Sept. 5 season opener against the New York Giants. And ESPN KFFN 1490-AM/104.9-FM will carry Sunday afternoon doubleheaders most weekends as well as most Sunday and Monday night NFL games.

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

HOW WE DID IT

Audience estimates calculated from Arbitron ratings data of weekday hour-by-hour listeners ages 12 and older and averaged over the hours the personality is on the air. Only data from 6 a.m. to midnight was used in the calculations. Ratings period was conducted March 29 - June 20, 2012, versus April 1 - June 23, 2010.

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AUGUST 17, 2012

HOW TALK RADIO SHOWS RANK

Don’t you just

These are the rankings of weekday radio talk shows in the Tucson market based on average listening audience during the time the program is on the air from 6 a.m.-midnight, using data from Arbitron ratings. Arbitron data measures listeners ages 12 and older. Stations and their brands: KNST = KNST 97.1-FM/790-AM KQTH = The Truth 104.1-FM KUAZ= KUAZ 89.1-FM/1550-AM KVOI = The Voice 1030-AM KWFM = Star 1330-AM (was KJLL The Jolt in 2010)

This year

2010

Program

1 Rush Limbaugh

6 NPR Morning Edition

3 Sean Hannity

4 NPR All Things Considered

9 Diane Rehm

Time

Station

Average audience 2012

Average audience 2010

9 a.m.-noon

KNST

12,965

14,465

6 -9 a.m.

KUAZ

9,133

6,100

Noon-3 p.m.

KNST

7,167

7,135

3:30-6:30 p.m.

KUAZ

6,783

6,970

9 -11 a.m.

KUAZ

6,750

5,600

13 Fresh Air with Terry Gross

11 a.m.-Noon

KUAZ

6,400

4,700*

11 Talk of the Nation

Noon-2 p.m.

KUAZ

5,550

5,300*

15 Marketplace with Kai Ryssdal

3-3:30 p.m./ 6:30-7 p.m.

KUAZ

5,550

4,100

14 Glenn Beck

3 -6 p.m.

KNST

5,200

4,365

6 -9 a.m.

KNST

4,900

5,865

2 -3 p.m.

KUAZ

4,900

3,700

- James T. Harris

10 a.m.-Noon

KQTH

3,950

12T

8 Neal Boortz

Noon-2 p.m.

KQTH

3,950

5,700*

10 Jerry Doyle

2 -4 p.m.

KQTH

3,650

5,350

12 Michael Savage

10T 10T

7 Morning Ritual with Garret Lewis 17 BBC The World with Lisa Mullins

12T

2 Jon Justice

19 Coast to Coast with George Noory

28 Mark Levin

- America Now with Andy Dean

4 -7 p.m.

KQTH

3,600

5,000

6 -10 a.m.

KQTH

3,050

8,450

9 p.m.-5 a.m.

KNST

1,567

1,860

7-10 p.m.

KQTH

1,533

700

6 -9 p.m.

KNST

1,167

22 Stephanie Miller

6 -9 a.m.

KWFM

1,100

1,265

27 Michael Medved

1 -4 p.m.

KVOI

933

750*

26 John C. Scott

4 -5 p.m.

KVOI

900

800*

10 p.m.-1 a.m.

KQTH

800

6,550*

5 Laura Ingraham

24 Hugh Hewitt

5 -8 p.m.

KVOI

767

900*

20 Wake Up, Tucson with Chris DeSimone and Joe Higgins

6 -8 a.m.

KVOI

750

1,350

31 Dennis Miller

8-10 a.m./ 8-9 p.m.

KVOI

733

470*

9 a.m.-Noon

KWFM

600

1,262

27T

23 Ed Schultz

27T

32 Phil Hendrie

29 30

- Mike Huckabee 25 Various

10 p.m.-1 a.m.

KWFM

600

300

10 a.m.-Noon/ 9 -10 p.m.

KVOI

567

Noon-1 p.m.

KWFM

400

900

31T

- Bill Buckmaster

Noon-1 p.m.

KVOI

300

31T

29 Thom Hartmann

9 -10 p.m.

KWFM

300

700*

- Michael Smerconish

1 -3 p.m.

KWFM

200

- Dr. Joy Browne

3 -6 p.m.

KWFM

- Leslie Marshall

6 -9 p.m.

KWFM

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Compiled using data from Arbitron Inc.

Notes: Averages calculated from average quarter hour ratings from 6 a.m.-midnight and do not include ratings outside that time parameter. Asterisks indicate programs aired at different times in 2010: • Fresh Air With Terry Gross aired from 1-2 p.m. • Talk of The Nation aired from 11 a.m.-1 p.m. • Neal Boortz aired from 10 a.m.-Noon. • Coast to Coast With George Noory started at 10 p.m. • Michael Medved aired from noon-3 p.m. • John C. Scott aired from 3-5

p.m. and was on KJLL. • Laura Ingraham aired from noon-2 p.m. • Hugh Hewitt aired from 3-6 p.m. • Dennis Miller aired from 7-10 p.m. • Thom Hartmann aired from 7-10 p.m. Political talk shows ranked in 2010 but are no longer air were: 17 - Jim Parisi, 8-10 a.m. KVOI, average listers: 2,050. 18 - Dr. Laura Schlessinger, 1-3 p.m. KJLL: 1,900. 21 - Dave Ramsey, 6-7 p.m. KNST: 1,300. 30 - Michael Savage, 7-10 p.m. KNST: 535. 33 - Clark Howard, 10-Midnight KQTH: 265. 34 - Lou Dobbs, 6-8 p.m., KJLL: 250.

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12 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

MEDIA TECHNICALLY SPEAKING

How technology can confuse an organization’s decision makers

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In their insightful book, “Blur, The Speed of Change in the Connected Society,” authors Stan Davis and Christopher Meyer focus on the ways technology blurs the lines between home and work and personal and professional. Computer and Internet technology has spawned another kind of blur; one that can seriously damage organizations. It involves mistakes in marketing and communication about who should do the work and make the decisions at all levels. The blur comes at the intersection of the technology that enables communication and the experience, talent and skill required to communicate. Here are some mini-cases of blur. Read them and decide whether the key person who should be involved is a technician, a graphic designer, a writer/editor or a marketer (a person overseeing all communication). Warm up on this easy example: A communications coordinator can’t send email vital to her work. She gets an error message in Microsoft Outlook. Who’s responsible for tactical success here? Right, a technician. The SMTP port setting must be 2525, not 25. The email’s ready to go, but technology has it on hold. Next case, perhaps more difficult: An organization has an established logo. The logo is made up of a graphic treatment or “icon” alongside a specific type treatment that spells out the organization’s name. Think Bank of America’s logo that includes a treatment of the U.S. flag. The logo used on the organization’s website is not an approved version. Why not? Because the approved “logo didn’t look right on the website. It didn’t work.” Was this a technical decision? A graphic one? A writing/editing decision because the logo used on the website split the organization’s name, with the icon in the middle. Or was the logo change a marketing decision? As technical matter, the approved logo could have worked. At the simplest level, the decision to use a different logo was graphic. But more importantly, the senior person involved made a marketing decision. A major change to a logo is a change in branding. Brand management is the epitome of marketing. Now, here’s a different case. An organization successfully uses an email campaign to reach a high percentage of its key audience. One person writes the message. Another uses Constant Contact or Mail Chimp to send out the email. The email uses a design template from a graphic designer, and the coding is done by a programmer. Suddenly, the organization desides to make a major change in the email campaign. A new message must go out about a

new service. The content comes from a different writer. The email’s subject line, image and links must be changed. Who needs to be involved? The technician must send the email. A new image about the service means a DAVE TEDLOCK graphics decision must be made. Ultimately, a communication manager must oversee the whole process, making sure the subject line, written content, images and links make sense – and work together to promote the new service. Final case: An organization understands that having 500 words or more of the copy on key pages is one of many (perhaps 101) factors for Search Engine Optimization (SEO). Who all is involved in producing the copy? A writer provides the copy. A technician runs key word analyses based on search marketing and visitor reports. A graphic designer provides the look. A technician writes the code. A marketing or communication manager should manage the decisions and the results. It is impossible for one person in an organization to be a highly competent and talented technician, graphic designer, writer and marketing manager. Whether it’s economics or a simple mistake, blurring these lines results in an email, website, online ad, or other communication that fails in one or more ways. In their book, Davis and Meyer advise readers to quit fighting the blur between personal and professional and instead to capitalize on it. The same advice applies to the blur in the roles of technicians, graphic designers, writers, editors, creative directors and managers in our technical world. Each organization must identify and be honest about the talents and skills of the people involved, take advantage of the synergy, and rely on a communication professional to keep the organization on goal, on strategy, on tactic. Imagine a new campaign with a new, simple message. A bumper sticker, a poster, a tweet, an email campaign, a Facebook comment. The teaser: Blur Happens. The campaign theme: Blur Happens, Make It Work.

Contact Dave Tedlock, president of the website development and marketing company NetOutcomes, at dave.tedlock@netoutcomes. com or (520) 325-6900, ext. 157. His Technically Speaking column appears the third week of each month in Inside Tucson Business.

InsideTucsonBusiness.com

AUGUST 17, 2012

PROFILE

Flying friendly skies with Universal Avionics By Alan M. Petrillo Inside Tucson Business

Universal Avionics Systems Corp. TK

The next time you’re flying in an aircraft, your aircrew might very well be guided by technological systems designed, engineered and built in Tucson. Universal Avionics Systems Corp. operates a state-of-the-art manufacturing plant near Tucson International Airport where it builds satellite-based flight management systems that allow aircraft to navigate in any weather conditions, as well as flight data recorders, cockpit voice recorders and other critical avionics systems. Chief Operating Officer Paul DeHerrera said Universal Avionics has its headquarters adjacent to its Tucson manufacturing facilities, and also operates engineering facilities in Redmond, Wash., and Duluth, Ga., as well as a sales office in Basel, Switzerland. The company is planning to open sales offices in London and Singapore in the near future, he added. “We used to have our manufacturing facilities disbursed around the country, but consolidated them all in Tucson where we do all the prototyping, manufacturing and production work,” DeHerrera said. “And because our headquarters is in Tucson, all our marketing is focused here, as well as accounts receivable and payable, product support, research and development, and the infrastructure of the corporation.” DeHerrera said the headquarters building is about twice as large as the Tucson manufacturing facility, and that 260 employees work in the two buildings. “We also have a hanger operation here where we maintain two aircraft,” he pointed out, “because all of our test flying is accomplished here in Tucson. Our repair labs also are located here.” DeHerrera said that the most recognizable products that Universal Avionics makes are what the public calls “black boxes,” — the actually orange-colored devices known as cockpit voice recorders (CVR) and flight data recorders (FDR). “We also make a combined version of the CVR-FDR that does both tasks,” DeHerrera said. “So depending on a customer’s needs, we’ll either put in a combined unit or separate CVR and FDR units. If it’s the two units, there’s a certain amount of redundancy in the two models that aircraft owners often desire.” DeHerrera said the products Universal Avionics makes in Tucson can go on virtually any type of aircraft, from small privately-owned general aviation aircraft up to the largest of commericial airliners. “Our products are certified by the FAA (U.S. Federal Aviation Administration) for all of the different categories of aircraft,” he said. The other flagship product of the company, what DeHerrera called the “grassroots of Universal Avionics,” is its flight manage-

ment system, which was first developed by the company’s founder, Hubert Naimer, in Torrance, Calif. “When our founder began the company, a number of sensors were used to give a pilot various types of information, but it was like the pilot was wearing four different watches,” DeHerrera said. “Mr. Naimer came up with a system that recorded the information from the various sensors and filtered the data into a one-best-present position. It essentially presented the pilot with a ‘you are here’ position.” The Universal Avionics Flight Management System, which is now the company’s best-seller, evolved from that initial concept, DeHerrera said. “With our wide area augmentation system (WAAS) and satellite-based augmentation systems (SBAS), we’ve added enhanced GPS (global positioning systems) that improves the accuracy of the systems,” he said. “The WAAS/SBAS-FMS can bring an aircraft down on approach to 250 feet at a quartermile visibility. If you think about guiding a big jet down to 250 feet, that’s pretty much just off the deck and at 120 knots airspeed is like threading a needle.” Yet the system has proven itself to be extremely accurate,” DeHerrera said, “proven time and time again.” One of the advantages of selling customers its flight management systems, De-

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Herrera said, is that those clients often upgrade their aircraft with other Universal Avionics systems. “A lot of customers start out purchasing our FMS and then upgrade their flight decks to flight panel displays that we make, data link products or flight data recorders and cockpit voice recorders,” he said. DeHerrera said there are some new products in the pipeline that Universal Avionics’ research and development staff is testing in its Citation jet aircraft. “We introduced synthetic vision for aircraft nine years ago and now that the earth has been mapped so precisely, we have incredible sources of information to put into that system,” he noted. “We take the map data from a number of sources, including the Space Shuttle, and put that earth topography into a database. Then, based on the aircraft’s GPS position, we can put the topography in front of the pilot on a display.” DeHerrera said using high definition dis-

plays, high resolution display glass and faster processors that run cooler, Universal Avionics is able to present a pilot with a view of the world, including runways, that he might not even be able to see outside his windscreen. “If the pilot were flying down a canyon, we can show him what it looks like in real time with this system,” DeHerrera said. “And with our Enhanced Vision System (EVS), which uses infrared technology, we can even show the pilot if a deer is running across the runway.” The WAAS is accurate to within a meter, DeHerrera added, much tighter than the current FAA standard. “In the future, we will be able to put a lot more up on the display,” DeHerrera predicted, including traffic (other aircraft), colored typography of the earth areas that represent a danger, and eventually to be able to show the cities the pilot is flying over in three dimensional images.” DeHerrera said he sees plenty of opportunity for growth of Universal Avionics in Tucson. “We’re working on a new synthetic vision system for Rockwell Collins, Ruag is using our full flat panel glass as standard in their aircraft being built in Germany,” he said. “And Horizon Airlines is retrofitting 90 ship sets with WAAG flight management systems because they fly into areas like Juneau, Alaska, where clear days are rare and the weather is a constant challenge.”

14 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

NEXT GENERATION NEXT GENERATION

By Patrick McNamara Inside Tucson Business In the world of digital cameras, detail and resolution are measured by pixel count. A standard smartphone camera maybe has 8 megapixels, or 8 million pixels per image. A quality point-and-shoot digital camera might give you a 20 megapixel count. Professional grade cameras can provide even higher megapixel resolution of images. But a group of researchers at the University of Arizona are part of a multi-university team that’s developing a gigapixel camera. Giga refers to a billion pixel count. “You can easily get lost in these images,” said Michael Gehm, assistant professor of electrical and computer engineering at the University of Arizona. The images the camera produces are massive. Gehm’s part of the team, which includes researchers at Duke University, MIT, U.C. San Diego and other UA professor and graduate students, who have worked on the project called Aware-2. The team also includes private companies like Raytheon and Distant Focus. The gigapixel camera’s images can be drawn into focus at multiple ranges. For example, using a conventional camera, a single panorama landscape shot would lose clarity and become pixilated as the image is enlarged. Images from the gigapixel camera remain in focus even as individual elements are enlarged. Gehm, 43, did his doctoral work at Duke University and came to UA in 2007. He said the Aware-2 camera achieves such detail not by building larger, but smaller.

Duke Imaging and Spectroscopy Program

UA researchers part of team developing gigapixel camera

The Aware-2, shown here with side panels removed, can take snapshots that have a nearly limitless resolution. The images are measured in the billions of pixels, compared to standard digital cameras that have 10 to 20 million pixels.

Rather than build a camera with one massive lens filled with sequential pieces of polished beveled glass, the Aware-2 project sets up numerous smaller digital cameras in an array. “You go from sequential approach to a parallel approach,” Gehm said. As an analogy, Gehm said the philosophy that changed computers applies to the gigapixel camera. As computing began to advance through

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the 1970s and 1980s, the physical size of computers grew as well. In fact, computer processors had grown so large to do the number of computations needed that their mainframe computer hosts could fill entire rooms. Computer engineers began to think smaller, however, which ushered in the era of personal computers. “There comes a point when it makes sense to stop making things more complicated,” Gehm said. The Aware-2 camera is made up of one large lens surrounded by 98 smaller cameras, working in conjunction to produce an individual image. Gehm and his UA team have been at work on designing a software system to operate the camera and make the array of lenses work in accord. It’s similar to how some digital photo ed-

iting software programs can stitch together multiple images taken sequentially into one large photo of a landscape. But Gehm said the gigapixel camera would do the same with infinitely greater clarity and, ideally, in an instant. In addition, because the images the camera captures hold such detail, it can make corrections for bright sunlight and dark shadow areas in the same photo. But images as large as those the Aware-2 camera produces also poses some problems. Gehm said finding printers to produce the images has been a challenge. So too has been viewing the images, in non-condensed form, on a computer screen. That issue probably will become even more significant as the technology evolves, Gehm said. The team plans to start putting enough digital firepower behind the camera to produce images in the 40 to 50 gigapixel range. “That’s like 10,000 times what you can see on a monitor,” he said. “How do you show it to somebody.” The practical solution at this point has been to display the images in a format that can pan across the photo and have a display map that shows where the view presented is in the image. Gehm said the prospective customers for the camera have been the defense industry, but some media outlets and sports broadcasters have shown interest as well. He also sees an application in historical preservation. Instead of taking hundreds or thousands of images of building’s exterior, all the same detail could be seen in a single gigapixel image. And that’s just the beginning. “Ultimately, the goal is to transition this to video,” Gehm said.

Next Generation is a monthly feature of Inside Tucson Business profiling Southern Arizonans on the cutting edge of developing their ideas. If you’ve got an idea or someone you think should be profiled, contact reporter Patrick McNamara at pmcnamara@azbiz. com or (520) 295-4259.

InsideTucsonBusiness.com

AUGUST 17, 2012

CALENDAR SPECIAL EVENTS

Chamber XChange Wildcat Football Kick Off Tuesday (Aug. 21) 6 to 8 p.m. Desert DIamond Casinos & Entertainment 7350 S. Nogales Highway Contact: Jason Cook jcook@ tucsonchamber.org or (520) 792 2250 ext. 137 $34.99 members; $49.99 non-members www.tucsonchamber.org/index. php?src=events&srctype=detai l&category=default&refno=47 RSVP required Show your support for the University of Arizona and special guest Head Coach Rich Rodriguez. Nike, The Brand Experience Thursday (Aug. 23) 7 to 10 a.m. The Westin La Paloma Resort & Spa 3800 E. Sunrise Drive Join the Tucson Metro Chamber and Pima Federal Credit Union in welcoming Nike executive, Loren Hoppes to hear about the Nike brand identity. Contact: Arlene achiovet@ tucsonchamber.org 792-2250 x135 Cost: $45/members; $65/non/members www.tucsonchamber.org SAHBA Fall Home and Garden Show Friday (Oct. 5) through Sunday (Oct. 7) 10 a.m. to 7 p.m. Friday and Saturday and 10 a.m. to 5 p.m. Sunday Tucson Convention Center 260 S. Church Avenue Contact: Amy McReynolds amy@sahba.org or (520) 795-3025 $8 for adults www.sahbahomeshow.com 8th Annual Tucson Record Show Sunday (Nov. 11) 9 a.m. to 3 p.m. Las Cazuelitas Event Center 1365 W. Grant Road Contact: Bruce Smith cassidycollectibles@earthlink. net or (520) 622-0104 Cost: $4 Dealers from all over the Southwest will be selling vinyl, tapes, CDs and music memoribilia. Dealer tables are $35. REGULAR MEETINGS

SAAEMA Monthly Program Third Tuesday

11:30 a.m. to 1 p.m. Viscount Suites Hotel 4855 E. Broadway Information: www.saaema.org RSVP: m.sage@wt-us.com Cost: $20 members, $30 nonmembers Saguaro Business Club Business leads meeting Every Thursday 7 to 8 a.m. Mimi’s Café 120 S. Wilmot Road RSVP: (520) 891-5430 Saguaro Rotary Club Every Tuesday 12:10 to 1:15 p.m. The Manning House 450 W. Paseo Redondo Information: Fred Narcaroti (520) 628-7648 Saguaro Toastmasters Every Monday 6:30 p.m. Ward 6 ofﬁce 3202 E. First Street Info: Mark Salcido (520) 991-6127 or gerontologist@ hotmail.com http://saguaro.freetoasthost.com SCORE Southern Arizona free business counseling Every Tuesday, Wednesday and Thursday 9 a.m. to 1 p.m. SCORE Main Ofﬁce 330 N. Commerce Park Loop Info: (520) 670-5008 SCORE Southern Arizona free business counseling Every Wednesday 9 a.m. to noon Oro Valley Library 1305 W. Naranja Drive Call Oro Valley Library at (520) 229-5300 to schedule Roadrunner Civitan Club of Civitan International SCORE Southern Arizona free business counseling Every Monday 10 a.m. to 1 p.m. Nanini Branch Library 7300 N. Shannon Road Info: (520) 791-4626

SCORE Southern Arizona free business counseling First and third Tuesday 9 a.m. to 1 p.m. ASBA 4811 E. Grant Road, Suite 261 Call ASBA at (520) 327-0222 SCORE Southern Arizona free business counseling Every Tuesday 9 a.m. to noon Marana Urgent Care Center (South Classroom) 8333 Silverbell Road Info: (520) 682-4314

Solutions Forum Fourth Monday Noon to 4 p.m. Clements Insurance 6245 E. Broadway, Suite 310 Information: 1-800-7169626 or (480) 200-5678 RSVP required Open only to business owners and divisional heads Southern Arizona Chapter of Enrolled Agents Third Tuesday 11:30 a.m.

Knights of Columbus Hall 601 S. Tucson Boulevard Info: (520) 751-8986, www. aztaxpros.org/sacea Southern Arizona Architects & Engineers Marketing Association Third Tuesday 11:30 a.m. to 1 p.m. Sheraton Tucson 5151 E. Grant Road RSVP: Dana Dietrich ddietrich@eectuc.com Cost: $25 members /

$35 Nonmembers Southern Arizona Chapter of the Society for Design Administration Fourth Tuesday Noon to 1:30 p.m. Viscount Suites Hotel 4855 E. Broadway Information: www.sacsda. com or tamara.g@wt-us.com RSVP: mormsby@ hmwstructural.com Cost: $20 members, $25 nonmembers

SIDT Thursday Breakfasts Soroptimist International of Desert Tucson Every Thursday through Sept. 06 7:15 am The Good Egg 4775 E. Grant Road Contact: Carol Cloutier carolcloutier@cox.net (520) 882-4873 sideserttucson.com Small Business Commission Meeting Fourth Thursday 3 to 5 p.m. Mayor and Council chambers 255 W. Alameda First ﬂoor Info: Ellen Hitchings, (520) 791-4343 ext. 245 or small. business@tucsonaz.gov The S.M.A.R.T. Group Every Friday 12 to 1:30 p.m. Nova Home Loans MultiMedia Conference Room 6245 E Broadway Blvd., 5th Floor $25 Members $45 nonmembers Contact: Dale Dillon Lips (520) 429-6000 or dillonadvisory@gmail.com Society for Human Resource Management Greater Tucson Chapter Second Tuesday 11 a.m. to 1 p.m. DoubleTree, 445 S. Alvernon Way Membership:Garrett Kowalewski, (520) 647-9100 garrettk@staffmattersinc.com RSVP by Thursday prior to meeting: www.shrmgt.org

{YOUR EVENT HERE} Submissions: Deadline for calendar submissions is 10 days prior to publication. Post your event online at www. insidetucsonbusiness.com/calendar. Email any questions to pmcnamara@azbiz.com.

A complete calendar listing is at

InsideTucsonBusiness.com

(FRQRPLF %HQHÀ WV 19 million dollars in tax revenue annually could help support our police and fire departments, schools and road repair needs. Well-paying jobs will be created, adding 400 jobs to the site per year. An additional 1700 indirect jobs will be created annually.

/RFDOO\ 9HVWHG The Rosemont management team is made up of over 40 of your Tucson neighbors. Ten are Arizona natives and six are UA grads. Many are involved in our community and youth programs.

16 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

BRIEFS GET ON THE LIST

Next up: New car dealers Inside Tucson Business is gathering data for the 2013 edition of the Book of Lists. Categories that will be published in upcoming weekly issues of Inside Tucson Business are: • Aug. 24: Highest paid city and county officials, Salary comparison of regional government officials • Aug. 31: New car dealers • Sept. 7: Television stations, Radio stations • Sept. 14: Minority-owned businesses, Exporters • Sept. 21: Locally-owned restaurants, Chain-owned restaurants If your business fits one of these categories, now is the time to update your profile. Go to www.InsideTucsonBusiness.com and click the Book of Lists tab at the top of the page. New and unlisted businesses can create a profile by following the directions. The Book of Lists is a year-round reference for thousands of businesses and individuals. To advertise your business, call (520) 294-1200.

MANUFACTURING

Navy extends Raytheon Tomahawk missile contract

$338 million contract to continue producing Tomahawk cruise missiles for the U.S. Navy. Under the contract, Raytheon will resupply the Navy with missiles it used in military operations as well as additional missiles that were part of the government’s fiscal year 2012 budget. The Tomahawk originally was produced by General Dynamics, but Raytheon now manufactures it. The missiles primarily are used by the U.S. and the United Kingdom. Raytheon Missile Systems division is headquartered in Tucson.

RETAIL

Mini’s Cupcakes moves again, now with Le Bon Gâteau After nearly two years in Casas Adobes Plaza, Mini’s Cupcakes and Ambrosia Cakes has moved once again and now is sharing space with another bakery, Le Bon Gâteau, at 4695 N. Oracle Road, Suite 105, across from Tucson Mall. Owner Jaynie Rossi, who combined her Mini’s Cupcakes with her other business Ambrosia Cakes, while at Casas Adobes. Mini’s Cupcakes originally opened in December 2009 in La Encantada shopping center. Le Bon Gâteau, owned by Maribel Cervantes, is open from 10 a.m.-6 p.m. Mondays through Saturdays.

Raytheon Missile Systems has received a

ENTERTAINMENT/SPORTS

Oro Valley extending free concert series Officials of the Town of Oro Valley have announced their free concert series will be extended into next year. Oro Valley and Southern Arizona Arts and Cultural Alliance say they’re continuing the musical series in response to the popularity of the concerts since they began in February. Upcoming performances will support local musicians in steel drums, folk and classic guitar, Latin and classic jazz, boogie woogie piano, blues, country and more. The free performances begin at 6 p.m. and will now take place on the second Thursday of each month in the Century Theatres courtyard at Oro Valley Marketplace, 12155 N. Oracle Road, at the southwest corner with Tangerine Road. Attendees are encouraged to bring their own chairs to the concerts.

HEALTH CARE

UA Medical Center gets $1.7M for transfusion study The University of Arizona Medical Center has been selected as one of a dozen Level 1 trauma centers to study which combination of blood products are most effective in saving the lives of patients who require massive

transfusions. The UA Department of Surgery will receive $1.7 million to conduct research over the next three years through the trial, PROPPR – Pragmatic, Randomized Optimal Platelet and Plasma Ratios. UAMC is the only trauma center in the Southwest involved in the study. The trial, which starts in September, will evaluate the effectiveness of the two most common ratios of blood products used to transfuse trauma patients suffering from massive blood loss.

GOVERNMENT

Brewer blocks benefits for Deferred Action immigrants Arizona Gov. Jan Brewer issued an executive order Wednesday banning illegal immigrants from applying for permits under President Obama’s federal Deferred Action program. The order cites concerns that the estimated 80,000 Deferred Action recipients would put “significant and lasting” strain on the state’s budget and public benefits systems. Under the Deferred Action program, which went into effect Wedneday, certain young immigrants avoid deportation and earn permits allowing them to reside legally in the United States while they work toward citizenship.

POLITICS

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Ruling puts permanent sales tax hike on ballot The Arizona Supreme Court ruled Tuesday to allow a proposition to go before voters Nov. 6 to permanently raise the state’s sales tax to 6.6 percent, with much of the money going to support public education. Arizona Secretary of State Ken Bennett had blocked the measure because supporters of the initiative filed an incorrect paper copy of the proposal, though the version submitted on a compact disc were correct. Bennett said his office proceeded usually uses the paper filing and had only accepted the CD as a courtesy. Bennett said after the ruling, “We were never trying to keep something off the ballot. We just wanted to make sure the law was followed.” It appears the petitions contain enough valid signatures for the measure to appear as Proposition 204 on the ballot. It essentially extends a temporary sales tax increase that is due to expire May 31, 2013.

InsideTucsonBusiness.com

AUGUST 17, 2012

PEOPLE IN ACTION

DALE REGELMAN

ELECTIONS Quarles & Brady LLP attorney Dale F. Regelman has been elected to vice chair of the Arizona State Barâ&#x20AC;&#x2122;s Executive Council for the Intellectual Property. The Council coordinates all activities of the State Barâ&#x20AC;&#x2122;s IP section. Regelman has served as a member-atlarge and secretary of the section for several years. He is a member of Quarles & Bradyâ&#x20AC;&#x2122;s IP practice and serves as president of the University of Arizonaâ&#x20AC;&#x2122;s James. E. Rogers College of Law Alumni Association

and the Arizona Law Review Association. NEW HIRES Curis Resources Inc., has announced that Rita Maguire has been hired as the companyâ&#x20AC;&#x2122;s senior legal and government affairs advisor. Maguire is a water rights attorney and natural resource policy expert. Maguire served as director of the Arizona Department of Water Resources from 1993 to 2001. The Town of Marana has hired John Kmiec as

its utilities director. Kmiec, who was previously with Tucson Water for 12 years, is the utilityâ&#x20AC;&#x2122;s environmental and regulatory compliance supervisor. His group is responsible for potable water and reuse water compliance activities. Kmiec also is past president of WateReuse Arizona, a state section of the WateReuse Association, an international organization of water professionals working to improve and increase locally produced and sustainable water supply resources. Kmiec has a masterâ&#x20AC;&#x2122;s degree in public

JOHN KMIEC

JENNA LLOYD

{TELL US ONLINE} Now your business can tell Inside Tucson Business about new hires, promotions and special awards online. Go to www.insidetucsonbusiness.com and click the â&#x20AC;&#x153;People in Actionâ&#x20AC;? button. From there you can submit your announcement and weâ&#x20AC;&#x2122;ll publish it online and in print. administration from Troy University and a bachelorâ&#x20AC;&#x2122;s in geological sciences from Michigan State University. The communications company tw telecom has hired Christine Morris as vice president and general manager for its Tucson

market. Morris has 14 years of experience within the telecommunications industry. Prior to coming to tw telecom, Morris was vice president of sales for Integra Telecom in Phoenix as well as Frontier Communications.

LUIS OCHOA

The Department of Pediatrics at the University of Arizona College of MedicineTucson and The University of Arizona Health Network has hired Jenna Lloyd, DO, assistant professor, to the section of Hospital Medicine and Outreach. Lloyd will provide care for hospitalized children at The University of Arizona Medical Center â&#x20AC;&#x201C; Diamond Childrenâ&#x20AC;&#x2122;s. Lloyd completed medical school at the Midwestern University, Arizona College of Osteopathic Medicine, and her residency in pediatrics at the UA College of Medicine.

AWARDS

RETIREMENTS

Quarles & Brady LLP has announced that Luis A. Ochoa, a partner in the firmâ&#x20AC;&#x2122;s Tucson office, has been named to Diversity MBA Magazineâ&#x20AC;&#x2122;s 2012 Top 100 Under 50 Diverse Executive Leaders list. The leaders were selected from a group of more than 300 highly competitive candidates from public and privately held companies as well as entrepreneurs and non-profit organizations for their achievements in their communities.

Tucson Jewish Community Center CEO Ken Light has announced plans to retire in March 2013. He has been with the Tucson Jewish Community Center for 26 years. Light opened the Tucson JCC location on River and has effectively worked with 13 different board chairs as well as countless volunteers and organizations within the Jewish and greater Tucson community. Light has a bachelorâ&#x20AC;&#x2122;s degree as well as his graduate degree in recreation administration from the University of Colorado.

BRIEFS BP agrees to sell Arco stations, refinery Inside Tucson Business BP, which put some of its assets up for sale to raise money after the April 2010 oil spill in the Gulf of Mexico, this week said it has agreed to sell its 800 Arco branded stations for $1.2 billion and a refinery in Carson, Calif., for $1.3 billion to Tesoro Corp., an oil company headquartered in San Antonio, Texas. Tesoro will continue to operate the stations and convenience stores, including the

seven in the Tucson area, under the Arco AM/PM brand, which BP will continue to own but lease back to Tesoro. Tesoro currently operates more than 1,200 stations under its namesake brand as well as Shell and USA Gasoline. Currently a Shell station in Yuma, is the companyâ&#x20AC;&#x2122;s only retail outlet in Arizona, according to its website. BP said it has now sold or agreed to sell assets worth $26.5 billion since 2010. The company has a target of $38 billion in disposals by the end of next year to help pay the costs of the Gulf oil spill.

Preferred Money Market for Business Interest rate through May 15, 2013, on daily collected balances from $10,000 to $2,499,999 s Open by December 31, 2012 at any BBVA Compass branch s BBVA Compass business checking account is required $0.1"44 s CCWBDPNQBTT DPN

Money market accounts are subject to approval. Promotional interest rates are available for new Preferred Money Market for Business accounts opened between 5/15/2012 and 12/31/2012. $10,000 minimum balance required to earn the advertised Annual Percentage Yield (APY). APY accurate as of 8/1/2012. Not available on existing accounts or funds already on deposit with BBVA Compass Rates are subject to change. Fees could reduce the earnings on the account BBVA Compass non-consumer checking account required to be eligible for promotional rate. Checking accounts are subject to approval and require a $100 minimum opening deposit. Additional terms may apply; refer to your account disclosure for details. BBVA Compass is a trade name of Compass Bank, a member of the BBVA Group. Compass Bank, Member FDIC.

18 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

FINANCE YOUR MONEY

Trends: Making a case for investing in fertilizer It has been said that food will be as valuable as gold in a few decades. It’s difficult for Americans to imagine, since a majority of us have never experienced food scarcity. However, in 2008, Joesette Sheeran, head of the United Nations (UN) World Food Program, said rising food prices were a “silent tsunami” likely to cause more than 100 million people around the globe to have too little to eat. Early in 2010, investor Jim Rogers affirmed the sentiment, saying that “sometime in the next few years we’re going to have very serious shortages of food everywhere in the world, and prices are going to go through the roof.” In order to avert a food crisis, crop yields will need to increase significantly. And that creates an opportunity for investors who watch trends.

What is driving the cost of food higher? It’s simply a matter of supply and demand. Limited supplies of grain and growing demand are pushing grain prices higher. On the demand side of the equation, three trends are likely to push up food prices: • Biofuels use: The popularity of biofuels is growing, which drives demand for agricultural commodities, such as corn, higher. The U.S. Department of Agriculture reported that 9.25 billion bushels of corn was used in ethanol production during 2010 and 2011 — about three percent more than expected. In fact, ethanol use is growing at a record pace in the United States. • Population growth: The world’s population is booming. According to the UN, the global population is expected to grow by 2.8 billion — that’s more than twice the current population of China — to 8.9 billion people between 2000 and 2050. • Rising income: As the average income grows in rapidly emerging countries, such as China, India and Brazil, demand for higher quality food is likely to increase. For example, in China, consumption of meat increased from 25 kilograms per person in 1990 to 50 kg per person in 2000. In 2008, it was about 53 kg per person. According to the World Watch Institute, about 5 kg of grain are needed to produce 1 kg of meat.

Can we meet growing demand? In its report titled, “How to Feed the World in 2050,” the UN projects that overall food production will need to increase by 70 percent between mid-2000 and 2050, and production in developing countries

will need to almost double. The most important factor limiting grain production is the amount of arable land available. The UN report states that the world’s arable land will increase DREW BLEASE by 70 million hectares, or less than 5 percent, by 2050. About 120 million hectares will become available in developing nations, primarily sub-Saharan Africa and Latin America, while 50 million hectares are lost in developed nations as populations expand. Land in developing countries often is suitable for growing only a few crops and those may not be high demand crops.

Increasing crop yields will be essential One key to preventing food shortages will be increasing crop yields. Fertilizer companies, particularly those that are involved in potash production and supply, should be considered. Potash is a macronutrient that plants need to thrive, and it is more scarce than nitrogen or phosphorous. Brazil, China and India all import significant amounts of potash to enrich their soils. This creates an opportunity for investors who understand the potential world food shortage and pressing need to increase crop yields. Potash companies may represent an excellent opportunity in what may prove to be an agricultural commodities bull market. The bottom line is that the increasing population growth, rising income, and increased use of biofuels are driving demand for grain. In order to meet that demand, food production must expand. Fertilizer may be an option to consider.

Contact Drew Blease, president and founder of Blease Financial Services, 7358 N. La Cholla Blvd., Suite 100, at drewblease@ bleasefinancial.com or (520) 299-7172.

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

Company Name

Symbol

Aug. 15

Aug. 8 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 0.02 11.07 40.25

0.04 0.02 12.59 41.07

0.00 0.00 -1.52 -0.82

0.03 0.01 8.35 34.28

0.50 0.10 15.94 42.10

8.73 0.50 2.77 7.87 57.96 7.05 84.71 19.36 57.91 3.63 17.56 28.74 34.19 24.71 31.34 15.65 96.47 42.29 44.22 9.26 74.19 57.03 18.11 34.76 25.81 55.00 58.47 198.40 33.39 59.20 5.72 37.07 33.14 10.32 51.03 22.09 1.59 31.33 26.83 40.44 57.78 38.54 36.79 35.65 46.49 68.28 23.67 12.78 56.24 45.03 16.02 42.21 56.60 8.14 9.02 43.48 32.00 64.50 17.00 29.90 42.69 18.20 123.71 28.15 10.15 33.17 74.45 35.56 33.97 9.30 19.16

8.74 0.50 2.23 7.72 57.45 7.06 84.67 19.99 58.90 3.76 18.01 28.95 34.35 24.43 29.85 15.72 95.56 41.76 45.21 9.48 71.45 56.36 17.89 35.65 25.93 52.66 58.99 199.31 33.23 59.44 5.80 37.27 32.92 10.04 52.23 22.68 1.25 30.33 26.15 40.52 57.42 38.04 37.51 35.67 46.18 67.88 21.26 11.97 55.60 44.67 15.92 41.53 53.36 8.28 9.09 43.64 32.12 62.91 16.45 29.23 42.26 18.05 122.01 28.22 10.34 33.08 74.49 36.12 33.79 9.61 19.04

-0.01 0.00 0.54 0.15 0.51 -0.01 0.04 -0.63 -0.99 -0.13 -0.45 -0.21 -0.16 0.28 1.49 -0.07 0.91 0.53 -0.99 -0.22 2.74 0.67 0.22 -0.89 -0.12 2.34 -0.52 -0.91 0.16 -0.24 -0.08 -0.20 0.22 0.28 -1.20 -0.59 0.34 1.00 0.68 -0.08 0.36 0.50 -0.72 -0.02 0.31 0.40 2.41 0.81 0.64 0.36 0.10 0.68 3.24 -0.14 -0.07 -0.16 -0.12 1.59 0.55 0.67 0.43 0.15 1.70 -0.07 -0.19 0.09 -0.04 -0.56 0.18 -0.31 0.12

7.97 0.20 1.48 4.92 50.95 5.30 65.35 16.97 43.77 3.30 12.30 21.40 19.54 14.61 22.19 8.49 72.46 31.16 32.14 6.60 38.99 43.64 8.03 28.85 16.92 31.03 41.22 157.13 27.10 39.87 2.69 27.85 25.73 5.02 42.14 20.98 0.49 12.14 18.28 32.90 38.64 22.66 25.49 13.68 33.20 49.20 19.06 3.29 38.35 36.50 14.73 30.98 28.89 6.25 7.15 33.61 20.96 47.25 14.04 24.34 27.62 15.51 77.73 25.77 3.96 20.10 48.31 28.53 22.61 4.44 13.18

12.93 3.88 4.30 10.10 62.80 9.94 86.01 28.53 60.00 5.29 21.16 38.40 35.16 28.79 33.80 15.84 97.76 43.43 48.69 12.25 76.33 67.20 19.35 48.96 30.49 55.34 62.00 210.69 34.77 62.33 5.85 46.49 35.86 13.12 56.66 24.83 1.81 31.90 32.29 41.80 62.83 42.17 40.45 38.16 48.31 69.02 43.18 12.92 56.92 46.40 23.16 42.31 85.90 14.32 10.05 46.08 32.79 64.99 18.66 34.24 42.91 25.84 126.91 58.29 14.51 34.10 75.24 37.61 34.80 9.92 22.81

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

AUGUST 17, 2012

INSIDE REAL ESTATE & CONSTRUCTION

Hotel going from past-prime to prime-time By Roger Yohem Inside Tucson Business

Housing stable One month’s data does not a housing trend make. What about three months? Hmmm, no. Still too early to tell. For three consecutive months, the me-

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

TUCSON REAL ESTATE

8/6/2012

7/30/2012

$160,000 4,101 353 346 198

$137,900 4,085 342 364 245

Source: Long Realty Research Center

Sales and leases Roger Yohem

By mid-2013, a past-its-prime hotel will become a prime-time player near the University of Arizona. That’s the plan for the transformation-in-progress at Aloft Tucson University Hotel, 1900 E. Speedway. Laying claim to being the closest hotel to campus, renovation of the 40-year-old building on the southeast corner of Speedway and Campbell Avenue includes an exterior face lift of new glass and stucco. The inside will feature an urban contemporary design in its new restaurant, lounge, bar and 154 rooms. The 95,000 square-foot hotel will get a new pool on the second floor and an underground parking garage. A free-standing conference center on the property will be demolished and replaced by two in-hotel conference rooms. The renovation is being done by Scottsdale-based Linthicum Corp. at an undisclosed cost. First opened in 1972 as the Plaza Hotel and Conference Center, the seven–story hotel became a Four Points by Sheraton Hotel in 2001 before it was closed in April for the remodel. Starwood Hotels and Resorts operates hotels under nine different brands, including Four Points and Aloft. Introduced in 2005, Aloft hotels are promoted as trendy “next generation” business hotels.

Hercules Industries, one of the nation’s largest heating and cooling equipment distributors and sheet metal manufacturers. It is the company’s fourth acquisition in Arizona and the first in Tucson. Air Distribution, a heating and cooling equipment wholesaler, opened in 2004. Owner Mike Downey, with 42 years of industry experience, will stay on to manage the sixemployee branch for Hercules Industries. Hercules Industries is the largest privately owned HVAC distributors in the Rocky Mountain West with operations in Colorado, Arizona, Utah, New Mexico and Wyoming. The purchase price of the Tucson operation was not disclosed.

A trendy Aloft hotel will emerge from this 40-year-old building.

dian sales price for a home in the Tucson region has held steady at $140,000. For the first time since February 2011, the average sales price is back above $180,000. However, the inventory-is-shrinking-fast hype hit a speed bump last month. The number of homes for sale stayed basically flat at 3,477 listings, up three homes from June. Since October, active listings had been falling steadily each month. Total new listings rose 61 homes in July compared to June. The source of new listings is an unpredictable combination of shadow inventory, the horde of off-again on-again sellers, lenders dumping properties, or other fluctuating factors. Based on the latest numbers from the Tucson Association of Realtors Multiple Listing Service, one positive trend that is absolute is that the region’s real estate market is off the bottom and slowly improving.

Robles acquires agency Lenny Robles, regional manager of Metro Title Agency of AZ, has acquired full ownership of the company. In 2009, Robles co-

WEEKLY MORTGAGE RATES Program 30 YEAR 15 YEAR 3/1 ARM

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One 12 Month 12 Month Year Ago High Low

3.50% 3.75%APR 3.50% 3.75%APR 4.95% 3.00% 3.125%APR 3.00% 3.125% APR 4.22% 2.88% 3.125%APR 2.88% 3.125% APR

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founded the agency as a subsidiary of parent corporation Metro National Title, which is based in Salt Lake City. The agency offers a variety of title and escrow services for residential, commercial and builder/developer clients in 38 states. “Robles’ experience and connections in Arizona have served our company well and we congratulate him on this new role as owner of the Arizona agency,” said Rod Newman, president of Metro National. “We anticipate a continued collaboration and close working relationship with our two companies.” Robles opened the agency, at 2502 E. River Road, during the economic recession. Despite a depressed real estate market, it operated profitably, according to company officials.

Million-dollar McDonald’s Construction of a new McDonald’s restaurant on the southwest side will pump $1 million into the community and create 50 permanent jobs. The 4,000 square-foot “modern concept” restaurant, at 1785 W. Ajo Way, will feature double drive-through lanes. It is being developed Roger Canchola, owner of Arcos de Oro Inc., 3341 E. 23rd St. His father, the late business and civic leader Jose Canchola, also owned McDonald’s franchises. The general contractor is Damitio Construction, 2760 N. Stone Ave. The designer is Robert Brown Architects, Tempe. Set to open in November, it will be the sixth McDonald’s franchise owned by Arcos de Oro in Tucson.

Air Distribution sold Air Distribution Sales, 503 W. Rillito Road, has been acquired by Denver-based

• W.E. O’Neil Construction purchased a 5,682 square-foot industrial/office building at 2610 N. Fairview Ave. for $620,000 from 2601 N. Fairview LLC, represented by Patrick Welchert, Picor Commercial Real Estate Services. The buyer was represented by Jerry Hawkins, CBRE. • Brock Technologies leased a 16,195 square-foot building at 3774 E. 43rd Place from Doubletree Investments, represented by Stephen Cohen and Russell Hall, Picor Commercial Real Estate Services. The tenant was represented by Bob Davis, Newmark Grubb Knight Frank. • Jumping Beans LLC leased 2,175 square feet at 7942 N. Oracle Road from HJ Tucson LLC, represented by Shannon Murphy, CBRE. The tenant was represented by Dave Hammack, the Volk Company. • Saguaro Center for Speech & Language leased a 2,088 square feet at 2011 N. Craycroft Road in Craycroft Plaza from Larsen Baker, self-represented by Melissa Lal and Andy Seleznov. Gordon Yarrington, Long Realty, represented the tenant. • Center for Healing Arts leased 2,080 square feet at 3333 N. Campbell Ave. from 3333 N. Campbell Ave. LLC, represented by Robert Nolan, Oxford Realty Advisors. The tenant was represented by Mick Beck, Voyager Bay LLC. • Calvary Chapel of Tucson leased 2,028 square feet at 8835 E. Speedway from Sandra J. Stinson Trust, represented by John Yarborough, Romano Real Estate Corporation. • New leases by Presson Midway LLC at 4500 E. Speedway include 1,067 square feet to Maxit Systems in Suite 7; 1,600 square feet to Prolam Plus in Suite 18; 2,400 square feet to Counsel Industries in Suites 47 and 48; and 938 square feet to Alchemy DUI Services in Suite 69. Rob Glaser and Paul Hooker, Picor Commercial Real Estate Services, handled the transactions.

Email news items for this column to ryohem@azbiz.com. Inside Real Estate & Construction appears weekly.

20 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

EDITORIAL BIZ BUZZ

All views welcome here, even those we disagree with This week’s column is prompted by a discussion between radio talk show host Jon Justice and state Sen. Frank Antenori, R-Tucson, had the morning of Aug. 10 on the Truth KQTH 104.1-FM. It was about an editorial that we had run in the previous week’s issue of Inside Tucson Business about violence that had erupted in Anaheim, Calif., and the differences we have from that here in Tucson. DAVID HATFIELD Apparently, we didn’t do a good enough job explaining our position on the matter, judging from Justice’s and Antenori’s conclusion that Inside Tucson Business supports the notion that voters should cast ballots based on race. What we had hoped to point out is that Tucson has gone beyond that and the kinds of issues that Anaheim faces, where the Hispanic population had grown to more than half of the city’s population and yet that majority was not represented among elected officials or other leaders in city hall. Tucson, on the other hand, has Hispanics in leadership roles throughout local governments. So much so in fact that we have two major Hispanic voting blocs. That is something of which Tucson should be proud. Beyond the point, though, Antenori was critical that the editorial was not signed and suggested the author was trying to hide behind the anonymity. That’s not the case. In fact, I wrote that editorial. I write many of the editorials we publish in Inside Tucson Business, but I don’t write them all. As in other publications, our editorials represent the opinion of the publication itself. As a regional business publication, we see our role as speaking out on behalf of business. And here’s where I want to say that an editorial isn’t the final word in our publication. We welcome all views and I make this promise: So long as it is factual and pertains to the readership of Inside Tucson Business we’ll run it. Our only constraints are space and timeliness. I’ll also promise that we won’t run it with any tacky notices that it’s counter to our opinion or anything else that might detract from the author’s point. Even if we haven’t written an editorial, I’d like to encourage people with something to say on matters important to business leaders of the Tucson region to send us those views as well. And yes, that includes candidates for office. If you’re looking for guidelines, let me suggest you shoot for slightly fewer than 750 words and send along a photo and contact information. If what you have to say can be said with less words, we can run them as letters to the editor, too. Email is best. Send opinions to editor@azbiz.com or use my email address, which is at the bottom of this column you’re reading in our printed publication or click on my name if you’re reading this online at www.InsideTucsonBusiness.com. Each voter has his or her own way of deciding how to cast a ballot. There’s not a lot Inside Tucson Business can do about that except to expose readers to important matters that can help them make up their minds.

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

EDITORIAL

Make sure employees know: it’s election time If you do nothing else today, make your plans to vote in the Aug. 28 primary election. Why is today so important? Because if you want a vote-by-mail ballot, 5 p.m. today (Aug. 17) is the deadline to request it from the Pima County Recorder’s Office. But wait, there’s more, as they say on the late-night TV infomercials. An axiom long-held by politicians — and not just in Tucson — is that businesses don’t vote, people vote. That’s true inasmuch as businesses haven’t done a good job impressing upon their employees that the success of the place where they work and their livelihoods depend on electing the kinds of officials who will help, not hurt them. Chances are you, as a business leader, have had an issue with a government entity. Whether it required you to spend hours commuting on Interstate 10 to Phoenix or pounding the pavement at your city hall, it’s impor-

tant for you to impart the experience and the outcome to your employees. If it’s good, then by all means make sure you let everyone know that. If the experience didn’t prove beneficial, then make sure that is known, as well. Don’t be timid. And make sure that as you impart this information you ask for the order. Make it absolutely clear that the reason you’re letting people know is so that they can consider it as part of their decision-making process in preparing to vote. Hopefully, you’ve got a relationship with your employees that is built on trust, understanding and cooperation. What we’re saying isn’t something thats new. We bring it up now to remind you and your employees that time is getting short. The election is at hand. The outcomes will make a difference.

VOTE FACTS

Vote by mail To order a vote-by-mail ballot, go to the Pima County Recorder’s website — www.recorder.pima.gov — and click on the link for “Early Ballot Request.” Ballots may also be ordered by calling (520) 724-4330 or anyone who is out of town may call the toll-free number 1-800-775-7462 and ask for extension 4330. Voters who are registered either as Independent or “Party Not Designated” can select to vote in either Democratic, Republican or Green Party primaries. Completed vote-by-mail ballots must be returned so that the arrive back at Pima County no later than Aug. 28. On Election Day Polls will be open Aug. 28 from 6 a.m. - 7 p.m. Because of redistricting following the 2010 Census and the popularity of early voting, the number of polling places in this election has been reduced to 288 from 417 in 2010. Voters can find their polling place online at www.recorder.pima.gov/public/voter_info.aspx.

InsideTucsonBusiness.com

AUGUST 17, 2012

OPINION BUSINESS INK

The Walmart effect on civil discourse and consumer welfare For all intents and purposes, an old friend who lives across from El Con Mall has been banned from meetings of the El Encanto Estates Homeowners Association. Get outta here! As a resident of the neighborhood, it’s persona non grata. What was my friend’s scandalous, wicked wrongdoing? Standing up and voicing an opinion. Taking an opposite position on a contentious issue. Refuting rumors with facts others didn’t want to hear. Having a backbone. My friend’s point of view was and is intolerable: Build a Walmart at El Con. So much for free speech in the city that is home to the National Institute for Civil Discourse. My friend supports the broad consensus of the businesss community that the city of Tucson desperately needs the sales and property tax revenues. As Inside Tucson Business editorialized last December, the neighborhood’s attempts at political and legal delays have cost city taxpayers an estimated $5 million. Just think what good City Hall could have done with that money other than for staff raises. El Con Mall also is in the Rio Nuevo redevelopment district. That’s more money being held hostage. In the real world, there are blue-collar

working-class people — way less fortunate than those living in El Encanto’s world of affluence — who need jobs. El Con is a large mall in a large commercial complex in a large city that attracts large retailers to ROGER YOHEM serve large populations. That’s job-creating synergy. Since this big-box rage began more than a decade ago, the rhetoric has been shrill. Seriously, in this city, don’t most neighborhood associations exist to stop progress by clinging to the past? And whatever their “issues,” the associations never have their own original data or study to back up their rants about higher crime, lower home values, more traffic, more noise, and more “undesirables” that will impact their neighborhoods. For what it’s worth, Walmart officials do use data and studies to address the concerns of their critics. For example, recent economic research done by Brigham Young University and the University of Chicago concluded that building a new Walmart store is likely to increase the values of nearby homes.

Intuitively, that makes sense. Build any new multi-million dollar structure in any neighborhood and the county assessor will raise all the surrounding property values. Studies of the “effect on consumer welfare” are even more meaningful. Walmart’s prices for identical food items can be 15 to 25 percent less than in traditional supermarkets. In research data that is un-refuted, Walmart’s low prices raise the “household wealth” of the poor, particularly minority families. For families who are regular Walmart shoppers, the research put the gain in household wealth at some $2,500 a year. That’s pretty significant in a city wanting to be more civil. Through the years, an obscure fact has kept city officials relatively quiet about this controversy. If something went wrong at El Con Mall, city government was exposed to a big financial liability. In February 2000, the City of Tucson approved the El Con Mall Development Agreement with the mall’s ownership group. History shows that the comprehensive plan had extensive input from the El Encanto, El Conquistador-Miramonte, El Montevideo and Colonia Solana neighborhoods that surround El Con Mall. Section 13 of the agreement spells out

the financial consequences of a successful legal dispute. To wit, in almost plain terms: In the event of any legal action or proceeding by a third party that challenges the validity of any provision of this Agreement, the parties agree to cooperate in diligently defending such action. If this Agreement is successfully challenged by a third party, the City shall pay the owners of El Con Mall all costs they incurred to implement and install the mitigation to Dodge Boulevard. The parties agree that this amount represents a fair and reasonable estimate of the damages that would be caused to the mall owners from such a challenge. Under the agreement, if the El Encanto Homeowners Association had stopped Walmart at El Con, city taxpayers would have been on the hook for about $14 million. At that price, Tucson needs more people like my friend to stand up against neighborhood associations. Now that the Walmart issue appears settled, a good place to start would be the neighbors who are trying to block the Kolb Road extension. After that, move on to the Snyder Road bridge.

Contact Roger Yohem at ryohem@ azbiz.com or (520) 295-4254. His Business Ink appears biweekly and weighs in on local political, social and business issues.

SPEAKING OUT

Partnership for a healthier Tucson: Canyon Ranch and El Rio Center Canyon Ranch founders Mel and Enid Zuckerman have spent more than 30 years helping people develop healthier lifestyles. The Zuckermans started Canyon Ranch to help guests from all over the world learn about making choices for a better, healthier life. The well-rounded program emphasizes finding meaning in life, practicing stress reduction, spending time in physical activity, and eating right. This helps people develop a sense of self-awareness necessary for desired permanent lifestyle changes. The Zuckermans believed the successful Canyon Ranch program should be accessible to anyone wanting to practice healthier behaviors. They established the nonprofit Canyon Ranch Institute (CRI), which takes the beneficial lifestyle programs and formalizes them so those who might not be able to afford to come to Canyon Ranch can still learn to practice healthy living. CRI was successfully developed in many communities across the United States, but Mel Zuckerman wanted the program to be established in Tucson too. He decided that Tucson’s El Rio Community HealthCare was a natural fit for this life enhancement program. El Rio, the country’s 14th largest community healthcare organization, has

served the uninsured and those who lack adequate healthcare coverage for 40 years. Over 1,000 people per day are cared for at El Rio’s facilities. El Rio serves a large CAROL WEST number of diabetics in a successful diabetes management program. These factors were important in developing the CRI program at El Rio’s El Pueblo Clinic, 101 W. Irvington Road. The staff at the facility were the first Tucson participants in the CRI. El Rio employees found the 2011 summer program to be “life changing.” Each participant spent time with a nutritionist, a primary care physician, a spiritual counselor, behavioral health consultant, and an exercise physiologist. Assessments helped establish benchmarks and what lifestyle changes were appropriate for each person. A support group was formed to encourage the staff in their efforts toward healthier lifestyle practices. Canyon Ranch staff also collaborated with

the healthcare team to customize the program so it would be appropriate both culturally and linguistically for the El Rio patients. El Rio staff members were impressed with the strong, supportive atmosphere the Canyon Ranch professionals provided as they helped engage the healthcare group in the concepts that would accomplish their goals. The El Rio staff noted the Canyon Ranch professionals’ passion for their work; they saw a strong customer service model that inspired the El Rio team to take some of these techniques back to their workplace. The goal-oriented program helped the staff participants remain focused. They believed in the CRI concept. They received information that helped them take better care of themselves; this allowed them to serve as role models for their patients so that they too could make the life enhancing changes for better health and wellness. The CRI then evolved to patients who would benefit from the 12-week program. A program was developed in Spanish and began with a thorough assessment of each patient. The project took into account the fact that these people were families with other obligations, including childcare, work schedules, and other factors.

CRI enabled the people to take charge of their healthcare and to better manage health issues they have, such as diabetes or heart disease. Members in the first patient group were enthused about what they learned and wished it could continue. Follow-ups are planned, and staff is keeping in touch with this first patient group. The participants have learned techniques they can use at home to increase their activity levels and to eat healthier foods. There will be small group sessions for them. A yoga and exercise program has helped the patients to continue what they have learned. The next steps will probably be to integrate the CRI into other El Rio facilities. Changes in the program to meet cultural aspects and other languages have to be considered. The CRI program enables El Rio patients and staff to engage in preventative care that saves healthcare dollars in the long term. If people practice healthier living, there is less need for costly health intervention processes. Everyone benefits from this partnership.

Contact Carol West at cwwfoster@aol.com. West served on the Tucson City Council from 1999-2007 and was a council aide from 1987-1995.

22 AUGUST 17, 2012

INSIDE TUCSON BUSINESS

OPINION GUEST OPINION

Prepare for more government control over home mortgages The residential mortgage market has gone through significant changes since the subprime mortgage meltdown of 2008. The biggest change is that subprime loans are no longer available. On July 30, 2008, President George W. Bush signed into law the Housing and Economic Recovery Act that included the Secure and Fair Enforcement for Mortgage Licensing provision (SAFE Mortgage Licensing). SAFE built upon states’ efforts to enhance consumer protection and reduce fraud by requiring all mortgage loan originators to be either state-licensed or federally registered. In Arizona, this is done by the Arizona Department of Financial Institutions. Also in response to the mortgage crisis, several new laws have either gone into effect this year or will go into effect next year: • Dodd-Frank Act The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 started the clock on hundreds of required rule makings. Half of the new rules will impact commercial or residential mortgage lending. The Dodd-Frank has had a clamping down effect on commercial banking and mortgage lending. The mortgage banking industry feels Dodd-Frank was complete overkill and the biggest government power grab ever to impact the financial industry.

While regulators write the rulebook for the mortgage finance system of the future, Congress will begin considering the future role of government in the secondary RANDY HOTCHKISS market. With the major financial problems faced by Fannie Mae and Freddie Mac, Congress would like to get government out of the home finance secondary market and put it in the private sector. • Consumer protection The Consumer Finance Protection Bureau is an all-encompassing entity that will effect and control the entire U.S. financial system. The rules this bureau will impose were supposed to be unveiled this summer but the decision was made to delay the release until after the November elections. One of the provisions will limit loan originator compensation to a flat fee which will certainly drive many loan originators out of business. Between them, Dodd-Frank and Consumer Finance Protection Bureau will have the effect of driving everyone except large commercial banks out of the mort-

gage origination business. From a broader perspective, our national and Tucson’s regional economy is stalled and in a state of stagflation. The housing industry has always been the engine that has pulled Tucson’s economy out of the doldrums. But in this economy, the housing industry will not improve significantly until the job market improves. The mortgage industry contracted dramatically as a result of the subprime mortgage meltdown and many institutional lenders exited the market. Staffs have been thin for the past few years and the recent increase in loan volume has resulted in dramatic increases in the amount of time its takes to process, appraise, underwrite and close on loans. It now takes 60 days and longer from start to finish. Companies aren’t staffing up because of their past experiences of boom and bust. So unfortunately, lower rates have not translated into more jobs in this industry. Another major change is the extreme tightening of underwriting standards. The ability to qualify for a loan has become difficult for many people, especially for those who have had credit issues during this economic downturn. Since 2008, other key changes have included reductions in loan-to-value and the allowed debt-to-income ratio. Credit

standards have been tightened, requiring a higher credit score to qualify. And appraised values coming in below what is needed to qualify for refinancing. In general, underwriting standards will continue to get tighter over the next few years especially if all the rules under Dodd-Frank and the Consumer Finance Protection Bureau are fully implemented. On a positive note, as an industry we are committed to moving forward. The U.S. continues to have the best mortgage origination system and secondary market in the world. Our industry will respond positively on behalf of consumers to the future restrictions and conditions we will be working under. The bottom line is good news: The national and local mortgage industry will continue to provide the home-buying public with the best choices for their financing needs.

Contact Randy Hotchkiss, president of Hotchkiss Financial Inc. and a Certified Mortgage Consultant with over 30 years of experience as a mortgage lender, at Hotchfin@aol.com or (520) 324-0000. Hotchkiss serves as the advocacy vice president for the Southern Arizona Mortgage Lenders Association.

InsideTucsonBusiness.com

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Should the City of Tucson and Pima County have done more to attract the F-35 pilot training base? Yes, they should have done whatever was needed 57% No, we didn’t want that base to begin with 32% They did as much as they could 11% Next week’s poll: What percent of your employees do you think will vote in the primary election?

• Letters to the editor — Opinions on business-related issues or coverage of issues by Inside Tucson Business are encouraged and will be published. Submit letters to the editor via email at editor@azbiz. com. Letters also may be mailed to Letters to the editor, Inside Tucson Business, P.O. Box 27087, Tucson, AZ 85726-7087. Letters must include the writer’s name and telephone number. Inside Tucson Business reserves the right to edit and may not print all letters that are received.

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AUGUST 17, 2012

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