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Vol. 4 No. 2

Generational Economics I


ssues such as unemployment, population growth and housing seeme to have greater impact here in the High Desert compared to the rest of the Inland Empire. In a somewhat isolated geographic area such as this, understanding the economic trends among various age groups is a vital tool for a businesses’ continued success. Learning and adapting to these “generational economics” can affect a company’s repeat business, business model, budget forecasts, and most importantly, the bottom line. This is all the more important considering the vast changes that the High Desert has gone through over the last decade. As the growth rate of the High Desert has outpaced the national average by more than four times, the most successful business owners have learned to keep up with technology. This includes outreach methods that target the area’s growing youth population as well as methods used to streamline many of their own previouslytedious business activities such as inventory and ordering. Longtime business owner Dave Greiner, of Greiner Buick GMC in Victorville, recently decided to include his dealership in, which potential buyers can access online. The dealership has refocused much of its efforts on recruiting younger buyers who need to build their credit with a low principal loan. To accomplish the company’s goals Greiner is obtaining more certified pre-owned vehicles, something he thinks may be trending across the industry. “We are a very young marketplace in the High Desert,” Greiner said. “When the majority of your population is between 30 and 64, that’s the wheelhouse of your market.” The dealership has also developed a page on several social media sites where they post pictures of customers with their new vehicles, deals, and new shipments. The staff ’s primary method of David Greiner communicating with customers is now through text message. The trend towards more technology and new platforms isn’t specific to car dealerships, it’s also seen in the foundation of the country’s economy- the housing market. According to Bloomberg Businessweek, last year 42

Photo of Civic Plaza 12 courtesy of City of Hesperia

Movie and Wine

Playing Soon in Hesperia HDBJ STAFF REPORTS Get ready for a glass of wine with your chick flick! Hesperia’s Civic Plaza 12, under the flagship of Cinema West, is anticipating receiving its liquor license sometime in April, said its CEO Dave Corkill. The 12 screen theater located behind Hesperia City Hall is set to serve guests beer, wine and food at the lobby café. CINEMA WEST con’t PAGE 3


Announcing HDBJ’s

People You Need To Know

“Congratulations!!” Caroll Yule, Darryl Evey, Jason Lamoreaux, Todd Tatum, Scott Kubicek, Robert Martinez, John & Sheri Rojo, Debbie Cannon


Vol. 4 No. 2

Inside This Issue:

Executive Q&A With Liz Hewson


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Strong Demand for H.D. Industrial Space Industrial Market Demand Continues to Strengthen

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Making Sense of the Numbers Real Estate Trends

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The Role Age Plays in the Workforce Page 8 Fingers Crossed:

California Workers’ Compensation Page 10

Disolving Cities

What happens when city bankruptcy isn’t enough?

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"Buy One Entree and 2 Beverages and Receive One Entree FREE"

percent of buyers went online to find the home they ultimately purchased. In 2001 that figure was below 10 percent. San Bernardino County’s median age is 31.9. This is at the younger end of many business owners’ target market. Despite the percebption of a large senior population in the High Desert, the number of county residents that fall between 18 and 64 outweighs those 65 and over by more than four times. More important still is the 27 percent increase in county residents between the ages of 18 and 64 occurring between 2000 and 2011. Equally pivotal to the number of different age groups moving to the area, is understanding the differences in spending habits between each generation, says Peter Allan, former economics professor and current Interim Executive Vice-President of Instruction and Student Services at Victor Valley College. “The baby boomer generation is not spending as much as they have in the past, that generation is more focused on ‘what do I need Peter Allen for retirement,’” Allan explained. “The next generation down has completely different spending habits, they’ve never had big spending habits.” Allan says that the largest factor that drives trends throughout generations comes down to jobs. The largest employers in the High Desert often require a combination of education and experience. “The real key is how do we get employers to give people a chance,” Allan said. In the City of Victorville the unemployment rate among 20 to 24 year olds is estimated at 31.9 percent according to Census data. Between 16 and 19 year-olds it stands at a whopping 66.7 percent. With the high rate of unemployment, this demographic is not earning enough surplus income to infuse into the local economy, requiring businesses to try new ways to draw in consumers across all generational borders. For the Victor Valley Chamber’s Chief Executive Officer Michelle Spears it means more online marketing and posting materials for members to access electronically. She also continues to print hard copies for groups that haven’t made the jump to online communiMichele Spears cations and social media. “You just have to make yourself available for the aging population and their needs, which may not match in your business, the needs of 30-year-olds and 40-year-olds,” added Greiner. There are other variables that make it hard to target future generations of consumers and what their needs will be. The Pew Research Center reported that the U.S. birth rate is at its lowest level since 1920, leaving many to question whether the struggle to find jobs is deterring many young people from settling down and starting a family in places like the High Desert. There is some hope. Haik Seropian, a 26-year-old Accounting Technician with the Victor Valley Wastewater Authority moved here with his parents in 2005 so they could buy an affordable house. After working for the agency through a temp service for 15 months, he was offered the full time position. A transplant from Los Angeles, he is soon to be engaged, and says he finds the Victor Valley the perfect place to sink his roots and start a family. “It’s peaceful, it’s quiet, it’s not congested, and I love the open space,” said Seropian, who graduated from VVC with his Associate of Science degree. There are more like him out there. If the High Desert can attract employers willing to offer something more than a job — a career — then the Victor Valley may just become a bustling economic boomtown once more.

Ryan Orr has been published in Las Vegas Life Home & Design, 944 Magazine, and spent three years as a reporter and political columnist for the Daily Press. He continues his passion for writing, contributing to local publications and journals within the water and wastewater industry.

Page 14 CINEMA WEST from PAGE 1

12180 Mariposa Road Victorville Excludes all holidays, not to be combined with any other discount or offer and must be presented to server before ordering.

Civic Plaza 12 opened its doors in December and is home to impressive digital projection and sound along with D-Box Motion Seating and two 60-footwide screens. These are among the largest in California. While Cinema West operates 11 additional theaters in Northern California and Idaho, this theater is the first venture of its kind in Southern California for the Petaluma-based company. The theater is located at 9711 Ninth Ave. For show times call (760) 956-7469, or visit

HDBJ NEWSMAKERS Elizabeth Brown of Lee & Associates, has been awarded two CoStar Power Broker Awards, for not only being the Top Office Leasing Broker, but also the Top Retail Leasing Broker, both areas of expertise representing the entire Inland Empire region.

Walt Wehrmann, Vice President and Broker Associate of Coldwell Banker Commercial was recognized by CoStar, the number one provider of commercial real estate information, as top leasing broker in the High Desert. Donald P. Brown of Lee & Associates has been awarded CoStar Power broker for being Top Office Leasing Broker. The prestigious CoStar Power Broker Awards are presented to those who closed the highest transaction volume in commercial property sales and leases in their respective market. Have a News Maker in your company you want to recognize? We want to share the good news with our business community. Send us the news with a photo to MAIL@HDBJ.Biz.

Announcing HDBJ’s People You Need to Know for 2013


PUBLISHER Western Star Financial, Inc. EDITOR-IN-CHIEF Gretchen Losi STAFF WRITERS Don Brown Dan Harley Jason Lamoreaux Ryan Orr Alyssa Penman Steve Sipe Sam Thatte Bart Wade Caroll Yule CONTRIBUTING WRITERS Gwen Bedics Robert Isbill Kari Martinez Keith Metzler Mike Nutter EDITORIAL BOARD Teri Ortega President Adelanto Chamber of Commerce Janice Moore President Apple Valley Chamber of Commerce Yvonne Woytovich President Hesperia Chamber of Commerce Eric Camarena President High Desert Hispanic Chamber of Commerce Michelle Spears President Victorville Chamber of Commerce EDITORIAL ASSISTANT Margaret Hand Bryana Eve OFFICE MANAGER Sherry Madan HDBJ is published monthly with an additional two Special Features, 40 Under 40 published in October and our Annual Book of Lists. You can also find us on the Web at HDBJ.Biz. All material is copyright by HDBJ with all rights reserved. To obtain permission to reprint or recreate content, contact us at Mail@HDBJ.Biz. For advertising inquiries call 760-244-8596. To subscribe send a $20 check to: Western Star Financial, 14895 Bear Valley Rd., Hesperia, Ca. 92345. Or to pay by credit card, Call 760-244-8596 For editorial inquiries, including story ideas, promoting a business event, or to be considered as part of our writing team, call Editor Gretchen Losi at 760-244-8596 or e-mail, Mail@HDBJ.Biz

Debbie Cannon Company: Academy for Grassroots Organizations Position: Vice President/COO (Chief Oppportunity Officer) Age: 58 Darryl Evey Company: Family Assistance Program Position: Executive Director Age: 46 Education: Bachelors of Science Alan Garret Company: St. Joseph Health, St. Mary Position: President/CEO Age: 48 Education: Certified Public Accountant (CPA) with a Bachelors of Arts degree in Business Administration and Accounting, Califiornia State University, Fullerton. Scott Kubicek Company: Wal-Mart Distribution Center Position: General Manager Age: 41 Education: Bachelors of Science in Human Resource Management Florida State University (1994) Jason Lamoreaux Company: Coldwell Banker Commercial & HomeSource Real Estate Position: President Age: 43 Education: Barstow High School/San Diego State University Career: Real Estate Robert A. Martinez AIA, CASp, CASI Company: Robert A. Martinez AIA Architect & Associates Position: Principal Architect - Owner Age: 48 Education: Architecture and Accessibility Career: Licensed Architect and Certified Access Specialist Johnny & Sheri Rojo Company: Golden Corral Restaurant Position: Owners/Franchisees Age: 48 & 44 Education: Johnny – High School, Sheri, Bachelor’s Degree in Business Administration, Cal State San Bernardino. Career: Restaurant owners Todd Tatum Company: American Housing Group Position: President Age: 50 Education: Bachelor’s degree, Harvard University Career: Real Estate Developer Philanthropy Caroll Yule Company: Shear Realty Position: Broker/Owner Age: 65 Education: Bachelor’s of Science- Degree in Organizational Management, University of La Verne

Newly Opened Businesses in the H.D. Safe-T Smog 10714 I Avenue, Unit B, Hesperia Hesperia Pottery and Fountains 11494 Mariposa Road, Unit A, Hesperia New Steps Flooring 16190 Main Street, Hesperia H-11 Trailers & Welding 17244 Darwin Avenue, Unit F, Hesperia Crown City Forklift 10844 E Avenue, Unit A4-5, Hesperia

You nominated them, the nominations were counted and here they are:

This year’s list of People You Need to Know clearly consists of notable business leaders. What you might not know - is that hidden in this list are also several Military Veterans, Deadheads, Ivy League grads, song writers, personal success stories that will knock your socks off and even one who protected Mother Theresa. You’ll get a chance to hear all their stories at a special executive breakfast each month as we learn all about these dynamic business leaders with a LIVE interview by HDBJ Editor Gretchen Losi. This is why we have introduced “12 People You Need to Know,” as a tool to introduce our region’s most interesting leading professionals and notable names to our community. Each month one of the Class of 2013 will be featured in a print story. Then, on the second Wednesday of each month, come and get to know then at the Green Tree.

A big Congratulations to this year’s HDBJ People You Need To Know! Event Date: Second Wednesday of every month Location: Green Tree 14144 Green Tree Blvd. Time: 7:30 a.m. Ticket Price: $20 includes executive breakfast

Deadline to purchase tickets: 4 p.m. on the Monday before the event.

For reservations call 760-244-8596 or e-mail Space is limited.

Executive Q&A With... Liz Hewson By: EDITOR GRETCHEN LOSI Name: Liz Hewson Company: Macerich/The Mall of Victor Valley Position: Property Manager Time in position: 4.5 years Age: 31 Liz Hewson is the Property Manager for The Mall of Victor Valley in Victorville, CA. She is also a member of the Apple Valley Rotary Club, a member of the Victorville Chamber of Commerce, having served on multiple committees, and a board member for High Desert Opportunity. Tell us something that we are seeing in our business community that we are not talking about now. With the opening of Macy’s, the local business and retail community is helping us create more excitement for the opening. The Mall of Victor Valley has come a long way in its 26 years of existence. For many years, Southern California’s High Desert has been a fast-growing market thanks to family-friendly housing prices and good employment opportunities. Since it was built in 1987, our well-situated property has been continually serving the needs of this market by always evolving to meet the changing preferences of the community. New stores, fresh amenities and modern design elements help keep this property top of mind for Victorville and the region. All of these reasons made our location desirable for a premier national fashion anchor like Macy’s. We look forward to creating more excitement and energy within the community in the near future. How does the Mall of Victor Valley do in comparison to other like malls in the county? The powerful combination of strong demographics and the center’s collection of top brands, make The Mall of Victor Valley a natural choice for retailers who want to reach the region’s attractive and ready consumers. The center has a loyal shopper as we’ve really gotten to know many of our shoppers through our social media outlets. We are continually working with our leasing team to bring in new brands and experiences that resonate well with our shoppers and complement the existing center. Today the center offers more than 546,000 square feet of shopping space that includes Sears, JCPenney and Macy’s, and truly meets the needs of this appealing market. As well, this center also is home to a Cinemark Theater and compelling in-line stores that include Bath and Body Works, Vans, The Children’s Place, Victoria’s Secret and Barnes and Noble, to name a few. Our leasing team is always in talks and negotiations to bring new retail and entertainment to this center. Tell us some ways the Mall of Victor Valley is succeeding during these tight economic times? With the addition of new and remodeled retailers, The Mall of Victor Valley is continuing to bring in great national brands that further solidify the appeal of the center and the neighboring community. The new JCPenney officially opened in Fall 2012 in its 93,000 square foot, single story, full line

department store. Macy’s is a brand new 103,000 square foot department store. The store will feature Macy’s well-regarded set of national and locally edited merchandise. With Macy’s, The Mall of Victor Valley will be home to three department stores in all – Macy’s, Sears and JCPenney. Last year the center’s Cinemark Theatre completed a renovation of its own. What are some marketing tips you can give other retailers? Connect with your consumer. Brand experience is key for any business. Providing your consumer with a positive “experience” will go a long way. I call it the “WOM” factor. Word Of Mouth is the best form of advertising, it’s genuine. Social media is also an important tool. Facebook and Twitter are instant and interactive. Your message reaches a large captive audience with minimal investment. What has been your biggest hurdle since taking over your position? As a new property manager in 2008, I saw many challenges mostly due to the economy. The property was directly affected when both Mervyn’s and Gottschalks filed bankruptcy and closed shortly after. Luckily our company had purchased Mervyn’s real estate portfolio and was able to backfill the space with Forever 21 in early 2009. Still the loss of both Mervyn’s and Gottschalks was felt by the inline tenants as traffic to the center was affected. How have you overcome it? In 2007, The Mall of Victor Valley completed an interior remodel including the modernization of the food court, family restrooms/new restrooms, and new soft seating. The next step was to complete an exterior remodel as well as add new anchors to our store lineup. Over the next few years, Macerich developed a plan that included a new expanded JCPenney, a new to market Macy’s, an exterior remodel of the entries, new monument and directional signage. What can locals look forward to from the Mall of Victor Valley in 2013? In addition to a new market, Macy’s, the community can look forward to new inline stores such as Crazy 8 and Justice and remodeled stores including Bath and Body Works and Hot Topic. Our Leasing and Management team are continually working towards adding fresh and exciting tenants to our tenant mix that meet the needs and wants of our consumer.


Strong Demand for HD Industrial Space Industrial Market Demand

Continues to Strengthen in Region


A trend taking shape in the past year is the move by industrial end-users to expand current facilities to accommodate more product. Newell Rubbermaid successfully expanded their facility at Southern California Logistics Airport at the end of last year, adding almost 180,000 square feet of space. Reid Products in Apple Valley also bypassed moving into another building and expanded its current facility on land they already owned. In Adelanto, Induction Technology Corporation expanded its operations on-site instead of moving locations. This trend is especially important to the local workforce, which not only retains the jobs that each company is already producing but also will benefit from hiring demands created by the local expansion.


The High Desert region is widely considered one of the best

locations in the Western United States for industrial development. The combination of trucking access to over 24 million people within 3 hours, a strong local workforce, low lease rates and plentiful land for development have made the High Desert blossom into an industrial hub in Southern California. Major companies such as Walmart, Dr. Pepper, M & M Mars and Newell Rubbermaid have all located to the High Desert in the past decade with large industrial facilities designed for manufacturing or distribution. The recent recession brought a significant decline in industrial demand as companies large and small quickly halted any expansion or relocation plans. As Southern California slowly moved out of the recession, industrial demand began increasing in the greater Inland Empire areas such as Ontario that had a large supply of vacant industrial space. Now that many of those regions closer to Los Angeles are near 100% occupancy and lease rates have stabilized, companies are again looking to the High Desert. Over the past year, the industrial market has continued to gain strength, with several positive signs leading into the first quarter of 2013. Demand for existing industrial buildings is high as space is limited in every city within the High Desert. Inventory levels and vacancy rates remained extremely low over the past year. In 2012, vacancy rates declined every quarter, ending at 4.4% at the end of December. Vacancy rates at the end of 2012 were 1.8% less than at the end of 2011. Last year, the High Desert absorbed a net gain of 361,747 square feet of industrial space. So far in 2013, demand has continued to be strong as vacancy rates and inventory continue to lower throughout the region. Demand is so strong, developers are now entering the market to plan large scale industrial development projects. With such strong demand and low inventory, most buyers and investors are looking for properties in the 15,000-30,000 square foot range that are versatile for multiple types of industries or uses, maximizing potential resell value. Investors are also looking at industrial land as the High Desert remains one of the last locations in Southern California that can offer large parcels for industrial development.

Making Sense of the Numbers Real Estate Trends N

Buyers in the High Desert have become much more diligent in their research of the industrial market and are looking for creative financing options to secure the few remaining buildings still available in the High Desert. Owners are beginning to offer more flexible and customized leasing options to attract or keep quality tenants. Industrial growth is vital to the High Desert as most cities rely heavily on industrial jobs to supply the local economy. Each incorporated city in the region has at least one industrial park, bringing numerous Fortune 500 companies to the region and employing thousands of local residents. While this growth slowed down in recent years, resurgence in the industrial market is essential to the economic health of the entire High Desert. Jason Lamoreux is CEO and President of Coldwell Banker Commercial in Victorville.





en new commercial buildings are currently under construction with another 34 million square feet of commercial buildings on the drawing board over the next 10 years in the High Desert. That’s not enough. Despite economic downturns, horrific tragedies, and everything short of locusts, our residents rise to the occasion to get us back on our feet and keep our streets bustling and our businesses open. Still, because of our aged infrastructure, the High Desert's reputation as an emerging center of the transportation and logistics universe is under threat. Our position as California's emerging hub for rail, air and logistics leader will erode on par with our architecture unless we formulate a long-term plan to address our challenged infrastructure, including the dated building inventory that supports our businesses. There are some new projects in the wind. Ten buildings (281,339 square feet) are currently under construction according to the commercial real estate information group, Costar. These include 2 industrial buildings in Hesperia and Victorville and retail being built in Apple Valley and Victorville. Another 34 million square feet of commercial buildings are on the boards, with proposed completion dates within 10 years. The projected development areas will include north Apple Valley Specific Plan, Southern California Logistics Airport (SCLA), Foxborough Industrial Park, G Avenue Rail Track in Hesperia and multiple retail locations through the Victor Valley. But, keep in mind, the projects that make it from planning to construction is anybody's guess. Our current construction activity hardly compares to the High Desert's biggest building boom from 1985 through 1991, when over 9.5 million square feet of new space was added over a six-year period. Still, we need more. The High Desert currently has 43 million square feet of commercial buildings. The inventory, collectively, is aging based on other major desert regions of the nation. An assemblage of the High Desert's buildings are 30 years or older. Many are heralds of the building booms of the late sixties, early and late eighties, icons that define our region. Many of those buildings are functionally obsolescent with designs that are no longer supportive of the needs of a modern day warehouse. We need the kind of space companies require to compete and thrive in this global economy. The kind of buildings this area needs are far more technologically sophisticated than architects, engineers, and city planners could have conceived years ago when they were built. New buildings are already being built that better meet the requirements of modern business in cities throughout Southern California - Colton, Fontana, Ontario and San Bernardino. As regional competition from Los Angeles, Orange County and the Inland Empire challenges our stronghold as the region’s emerging logistics and warehouse center, the High Desert must replace its antiquated icons with new architecture that will support the businesses of today - and as far as we can imagine The map shows proposed commerical building sites in the them into the future. If we do not start soon, the High Desert surely will lose its standing in all aspects. High Desert. Map courtesy of Costar Commerical. Don Brown is the Chairman of the Lee & Associates National Strategic Asset Advisory Group, and Asset Management Group, a member of Victor Valley Sunrise Rotary, and sits on the Victor Valley College Foundation Board.


ational headlines are proclaiming that the housing market is recovering and we can say the same here in the High Desert where our home prices are finally on the rise as well. To gage the improvement it is helpful to compare current numbers to our recent past. Only 6 years ago in the summer of 2006 our Median Home Price reached a high point at $323,000. Three years later, in May of 2009, we hit our low point at $100,000. If you compute the change from the lowest to the highest point, our property values dropped an astounding 69%. Luckily, unless you bought your home in July of 2006 and sold it in May of 2009, most of us will not actually realize this extreme value change. The numbers that have everyone smiling again are the year-over“During the last year there have year Median Home Prices. The Median Home Price for the been approximately 300-400 closings Victor Valley was $110,000 in per month. Based on this demand January 2012. In January 2013, a healthy supply of homes would be this number has increased to $127,000. Data from the Multiple about 2,400. Today there are only 604 Listing Service of the Victor Valley homes for sale.” Association of Realtors shows yet another increase in February to $135,000. There are a few elements as to why the prices are rising. One factor is as simple as the economic principal of Supply and Demand. During the last year there have been approximately 300-400 closings per month. Based on this demand a healthy supply of homes would be about 2,400. Today there are only 604 homes offered for sale in the VVAR Multiple Listing Service. Most of us in the industry believe there could easily be 500-700 closings a month if there were more available properties. This summer will be a good time for homeowners considering a move to put their home on the market. Another factor fueling demand is historically low interest rates $110,000 Median Home Price Jan. 2012 for mortgages. Economists $127,000 Median Home Price Jan. 2013 continue to predict rising rates this year and next. This type $135,00 Median Home Price Feb. 2013 of news encourages buyers to act today. Current rates of 3.0 – 3.5% have brought house payments in reach for many families. Many households have determined they can buy a home for less than they could rent the same home. A huge impact on current inventory is also the decline of foreclosure properties. Of the 604 homes offered for sale only 83 are Foreclosures. That is only approximately 14% of the market. There continues to be disagreement between economic experts as to whether or not there is a looming shadow inventory that could potentially impact home values. But Leslie Appleton, the Chief economist for the California of Realtors who has a Doctorate in Economics, states most emphatically, “There is no Shadow Inventory for the State of California, and even if it happened, with the shortage of homes for sale it would take only a matter of months to absorb a huge influx of homes.” There are many reasons for the decline of foreclosures including legislation and government programs established to provide relief for “underwater” home owners. Lenders are working hard to keep people in their homes and/or assist with Short Sales. Homeowners are receiving assistance through mortgage rate reductions, refinance options with no loan to value restrictions or income requirements and in some cases even principal balance reductions. Short Sale procedures now in place at major lending institutions have simplified and shortened the approval process. Although prices took a double-digit leap in 2012, most residential real estate projections are showing a more modest and normal increase in prices for 2013. The California Association of realtors is predicting approximately 5-7%. The good news is that without any unforeseen economic calamity, prices should continue to increasse.

Caroll Yule is President/Broker/Owner of Shear Realty, the highest selling residential real estate company in the High Desert.


PURCHASING YOUR FIRST HOME What you should know to streamline the loan process



f you are like most people, procrastination is a very big part of your life. We think, “Why do today what we can do tomorrow?” When in reality it should be as the saying goes, “Why put off until tomorrow what can be done today?” When it comes to purchasing a home the answer is simple. Do it now. Interest rates are at historical lows and the prices of homes are at a point that you can purchase a home for a lower monthly payment than most rents. If you’re one who thinks it impossible to qualify – think again. One of the most important steps (and they are all important) is to find out how much you

Above is the last 3 years of the most popular loans. 30 FRM (fixed rate mortgage) is the most common. It shows the rates going from the mid 5's to the mid 3's over the last 3 years. qualify for. You should contact a local loan officer and schedule a meeting to go over your income and asset documentation. Always use someone local who is familiar with the area and has a good reputation and vested interest in your town. A face-to-face meeting is the only way to build a great working relationship. It is very hard to get the level of service you deserve over the Internet. While you can also contact a real estate agent first, be sure the first question you ask is if the agent is qualified with a lender. Or, simply cut out the middle man and go directly to a lender yourself. Be prepared. The loan officer will have you bring in your most recent two year’s tax returns and W-2s. If you are self-employed, a current Profit and Loss will be required. Also, have your latest paystub on hand along with your bank statements from the past two months. This is to verify where your down payment would come from, and of course, bring your identification. Once the loan officer has analyzed your items and run your credit, you will be told how much of a home you can purchase. The loan officer will discuss your qualification and let you know if he will require any further items to review. At that time you will receive a Pre-Approval letter that you can take to a real estate agent. You can ask your loan officer to recommend an agent. They work with many loan officers and are a good resource to find a trustworthy agent who desires to help people get into their first home. Not everyone will qualify right away, and those that don’t shouldn’t get discouraged. A good loan officer will be able to put together a game plan of what needs to be done before you can begin to look for a home. If you’re not ready to buy your first home yet, but it’s in your near future, here are some tips: take care of your credit; stay steady in your employment; and put a little money away. If you do this, there is no doubt you will soon be a homeowner. There are several programs available to first time home buyers to help with down payments. Ask your loan officer if you qualify.

Bart Wade is a High Desert native and works as a lender with Regal Mortgage of the High Desert specializing in credit repair.



The Role Age Plays in the Workforce By: STEVE SIPE

What are you looking for in an employee, a tech savvy firecracker or someone who is loyal and dependable? And how do you find the qualities

old. Employers concerned about the risk of turnover should keep in mind the correlation between turnover and age and the cost of you’re seeking? The key may be found simply in their age. turnover. The job candidate pool has changed dramatically over the past 5 years. The Older workers have several other advantages including higher severe economic impact of the recession has made it necessary for people to skill sets, particularly in basic skills like math, reading and stay in the workforce longer. Millions of older Americans writing. They also have higher levels of engagement. have delayed retirement because of plummeting 401(k)s, Motivation and engagement actually increase with soaring health costs, a sense that Social Security benefits age, according to an analysis conducted on the part of Towers Perrin, a alone are too little to live on or all of the above. This delay, management consulting firm. The study states workers age 55 and older are economists say, has made it harder for millions of young the most motivated, while the youngest workers are the least. workers to climb onto the first rung or two of the career That’s not to say the younger workforce isn’t without its advantages. ladder, especially since many employers favor hiring Tom Szaky’s NY Time’s Blog entitled “Why We Don’t Usually Look For applicants with a track record. As they do, more employers Experience When We Hire” points out some benefits of hiring younger - ages 20-34 candidates. are looking at the pros and cons of hiring younger vs. older candidates. They have fewer bad work habits and fewer preconceived notions. They - ages 55+ Let’s look at things worth considering when weighing are easier to mold because they don’t know what to expect. Because these the benefits of hiring a young, talented person who might workers are just beginning their careers, the investment to hire them not have much experience, compared with an experienced, is lower, though training costs may be higher. Workers who have just seasoned individual. graduated school are also more likely to be informed on the latest technology and AARP research of the perception employers have about older workers industry advancements. And lastly, young workers are generally more energetic and indicates that older workers have better attendance records, better customer excited to work. service skills, are more loyal, reliable, and dependable. While it’s important to know the potential drawbacks and benefits of either case, The report also indicates that, in addition to their work experience, the value one should first hire based on qualifications and appropriateness for the position. of hiring of mature workers includes low turnover rates. According to the For several years Mr. Sipe was the Marketing Co-chair for High Desert Opportunity, and was a two term Bureau of Labor Statistics data on tenure patterns by age group, the average President of the organization. Mr. Sipe has been a contributing writer for New Age Media, President of the tenure among all US workers is 3.7 years. However, the median job tenure for Southwest Louisiana Ad Club, and has authored numerous sales training and strategy papers. He has been a resident of Apple Valley since 1994 where he resides with his wife Beatriz Potter. workers in the 55 - 64 age range is about 3.3 times that of workers 25-34 years

California Unemployment by Age

15.5% 9.2%

Health CareCheat Sheet


To help you get ahead of the curve in this fast paced world, High Desert Business Journal is preparing to join the ranks among the digital world. “Todays’ business owner has a demanding schedule. By going digital, HDBJ is able to meet the needs of their hectic lives by bringing subscribers the most up-to-date business news in the quickest format available,” said HDBJ Editor-in-chief, Gretchen Losi. “The HDBJ staff realizes readers want to know what we know, ASAP. That makes this transition that much more valuable.” The inaugural digital edition should be available for all digital media platforms, including personal computer, iPad, iPhone, Android Tablets, and Android Smartphones by mid-Spring, said Losi. Realizing there are some who value holding a monthly journal while reading it over their cup of coffee, HDBJ will also continue to be printed on a smaller scale. However, online subscriptions are expected to be the norm. The new digital edition is expected to evolve and be packed with videos, links, and other digital content that will make HDBJ a valuable asset to business and community leaders within the region. “We estimate this will more than triple our subscription base within the first year. It’s a win-win for advertisers and subscribers,” Losi said. For subscription information, send an e-mail to Mail@HDBJ.Biz or visit

Under the Affordable Care Act, or “Obamacare”, the state has the option to expand its Medi-Cal Program to cover over one million low–income adults who are currently ineligible. Unlike some states, which have refused to implement the health exchanges, California has embraced the federal health care plan and already begun the process of implementation. This means for three years beginning January 1, 2014, the federal government will pay all of the costs associated with the Medi-Cal expansion. Beginning January 1, 2017, the federal government will begin to decrease its portion, over a three–year period, until California pays for 10 percent of the expansion and the federal government pays the remaining 90 percent. That 10 percent portion of the cost could run as much as $1.4 billion annually, according to the Legislative Analyst’s Office. Currently the counties have the fiscal and programmatic responsibility for the care for the low–income adult population that would be covered by the expansion. The LAO says a statewide program could greatly alleviate the cost to the counties, although the Department of Finance would likely make downward adjustments to counties’ overall realignment payments. In January, Sen. Ed Hernandez, D–West Covina, Chairman of the Senate Health Committee, introduced two pieces of legislation to comply with the federal Affordable Care Act, which requires the expansion of Medi-Cal coverage. In California this means 1.6 million previously ineligible Californians will be covered. “I have concern for the fiscal impact on the State of California and our treasury,” Sen. Ted Gaines, R-Roseville, also said during Senate debate. While the Affordable Care Act requires mandatory expansion of Medicaid in every state, California is going beyond federal law and implementing Medi-Cal, California’s version of federal Medicaid, to a previously ineligible group – childless, able-bodied adults under 65. While the ACA also required this when it was passed, the U.S. Supreme Court, in its ruling on Obamacare, ruled that this is an option for states. But California is going to enact this option by changing the income calculation of these childless, able-bodied adults, allowing them to become eligible. The Medi-Cal income calculation used to include an asset test. The California Legislature passed a bill last year removing any asset test. This is a partial report, to read the full report and stay current on the proposed bills, go to


12 People You Need To Know April’s V.I.P.

CAROLL YULE By: HDBJ Editor Gretchen Losi

Known for her over the top sense of humor and spirit of optimism, it’s no

wonder Caroll Yule is president of the highest grossing residential real estate company in the High Desert. Her songs at Victorville Rotary have become legendary. With jingles like “Here Comes Ben Bernanke” sung to the tune of “Peter Cottontail,” she entertains with a wit and charm unique to Yule, and appreciated by all. “She’s like the Jay Leno of the desert. She’s fun. I don’t know anybody who doesn’t like Caroll,” said Michele Spears, president and CEO of Victor Valley Chamber of Commerce. Her contagious sense of optimism serves her well both in her personal life and in business. As president of Shear Realty since 2006 she manages five offices; two in Spring valley Lake, one in Jess Ranch, one in Apple Valley and the newest addition, an office in Rancho Cucamonga. Her positive energy has seen her business – and its 75 agents and staff - through six of the toughest years in the real estate market. “All these people are depending on me. I take that very seriously and am grateful to all who have worked so hard through these difficult times,” said Yule. Their dedication seems to be paying off. Shear is once again seeing profits, having sold over $187 million in 2012, nearly twice the amount of the second highest selling High Desert real estate agency. Being the proverbial optimist, she doesn’t dwell on the hurdles the market has had to overcome in recent years. Instead she looks towards the future and the potential for growth and prosperity revisiting the region. Where the area was once flooded by foreclosures and short sales, now there are only some 600 homes listed in the area, only a small fraction of them are REOs. The only challenge now is lack of homes to sell. “We have investors wanting to buy homes but there just aren’t enough on the market,” said Yule. “We have buyers purchasing lots again. I predict in a year or two we are going to see more new housing in the area.” Selling comes easy to Caroll, mostly she says, because she doesn’t see herself as selling anything. “I don’t sell. I get to help people through one of the most complicated business transactions in their lives,” she said.

A Little Caroll Yule FYI....

Prior to the Real Estate industry, Caroll Yule worked in management as a Legal and Medical Administrator. She first became a broker for Shear Realty since 1996. Ten years later she became its president. She manages the Apple Valley, Jess Ranch, Rancho Cucamonga and Spring Valley Lake offices. In addition to 16 years as a Broker, she has over 5 years additional real estate experience as a salesperson and in-house mortgage lender for Shear Realty. Current Community Service: Board Member, Victorville Chamber of Commerce. Chair of the Economic Enhancement Committee. MLS Committee member for the Victor Valley Association of Realtors. Board member and President’s Circle member of the Victor Valley College Foundation, and Board Member of the San Bernardino County Sheriff ’s Citizen’s Advisory Board. Over the Years - She is past Chairman of the Board for the Victorville Chamber of Commerce. Past President of the Victor Valley Association of Realtors. Previous Board Director for Desert Community Bank. Gala Co-Chair for St. Mary’s Medical Foundation and Board Member for Victor Valley Community College Bond Oversight Committee.

She loves what she does, calling it her passion, so the word, “retire” is simply not in her vernacular. When not fulfilling this passion, one might spot her on the green fulfilling her other – golf. She loves the sport and it’s evident with her 16 handicap. She’s also a world traveler having visited destinations like Moscow and Istanbul. She also loves to give of her time and energy to the community. “Caroll has got a closet full of costumes and she is not afraid to wear them for a good cause. She’s been a hippie chick, an Asian lady, a disco queen and a Valley girl in support of education,” said Ginger Ontiveros, president of the Victor Valley Community College Foundation. “In disguise or not, she is an incredibly classy, charismatic, competent and caring woman that I am truly blessed to know.” Caroll and her husband of 44 years, Dennis, have raised an accomplished daughter who recently graduated from Harvard with a Masters in Theological Studies. Having been raised in Minnesota and moving to and from the High Desert three times before calling it home for good in 1995, Caroll Yule is a vital member of our community, both business and non-profit. “She’s so willing. I don’t know how she has so much time to give,” said Spears. Caroll currently sits as a Board Member of the Victorville Chamber of Commerce, President’s Circle and on the San Bernardino County Sheriff ’s Citizen’s Advisory Board. She is also a member of the Victor Valley College Foundation and chair of the Economic Enhancement Committee. “She’s a super positive motivator and leader of people,” said local business owner Pat Orr, one of the many who nominated Caroll as one of HDBJ’s 12 People To Know.

Join us as we honor

Caroll Yule

during a special Executive Breakfast and LIVE interview. Get to know her better during a fun and lighthearted fireside interview followed by Q&A from those in attendance.

WHEN: April 17th 7 a.m. - 9 a.m. WHERE: Green Tree Fireside Restaurant

Honors: 2010 Recipient of VV Community College District Foundation Distinguished Community Service Award. Nominee for Distinguished Woman of the Year 2008. Boy Scouts of American High Desert Citizen of the Year 2008. Victor Valley Association of Realtors, Realtor of the Year 2003.

$20 per ticket Executive Breakfast included.

Education/Certifications: B.S. Degree in Organizational Management, University of La Verne. Certified Residential Broker (CRB), Short Sale and Foreclosure Resource Certification (SFR), California Notary.

E-mail us at or Call 760.244.8596

RSVP as space is limited!




I am deep into a personal injury lawsuit and I no longer trust that my attorney is right for me, do I have to keep him, or can I hire a new one? No, you are not required to keep your attorney. Under California law you have an absolute right to fire or change attorneys at any time. However you will be required to compensate your attorney for the work that was performed. Under the old law, there was a large distinction between firing your attorney “for cause”, or discharging him at will. Previously, if you could prove “cause” you were only required to pay him under a theory of “quantum meruit”. Quantum meruit is a Latin phrase meaning, "What one has earned." This has been interpreted by the courts to mean that you were required to pay the “reasonable value” of his services, as opposed to the contract rate. This reasonable value could be much less than a contract rate. For example, in a personal injury case where you may have contracted to pay 30% of your recovery, you could be required to pay the entire 30% to the previous attorney PLUS the amount you have agreed to pay the new attorney. In a large case, this contract amount could be millions of dollars. In contrast, if the original attorney was on the case for a short time he may have only “earned” a few thousand dollars. This “for cause” distinction led to a great deal of fee litigation. Theoretically, if “cause” could be proven, then the client could save money and avoid having to pay double for exercising his right to change attorneys. In 1972 the California Supreme court in Fracasse v. Brent , 6 Cal.3d 784, did away with this distinction. Today, whether an attorney is fired for cause, or any other reason, you are only required to pay him the reasonable value of his services. In contingency cases, that reasonable value will depend on to what degree the case has been completed. In your case you mentioned that you were deep into the case. So, if your case is ready for trial for example, you may be liable to your old attorney for up to 80% of the contingency fee. This may make it difficult to find a new attorney or you may end up paying more for the privilege of changing attorneys than you are willing. Please discuss this issue with your new attorney and be sure that you are comfortable with all of the potential consequences of this switch. Todd Turoci has been practicing law in the High Desert for over 20 years. Please submit your legal questions to

For the Water Cooler Companies are having to pay boatloads to shore up their pension funds, dragging down corporate earnings. The total estimated pension deficit at 400 large companies with defined benefit plans now stands at $408 billion, 23 percent more than in 2011. Companies are bound by law to fund those obligations over time. – Wall Street Journal Even though Americans drove more fuel efficient cars and consumed less fuel than ever in 2012, an Energy Department report states households spent nearly 4 percent of their pretax income on gas – the highest percentage in 30 years. -Los Angeles Times The number of stay at home dads rose from 81,000 in 2001 to 176,000 in 2011. Among men aged 25-54, 83 percent were in the workforce last year. Five years earlier that number was 88 percent. Nearly 44 percent of Americans don’t have enough savings to cover basic expenses for more than three months in the event of a financial emergency, like losing their job or paying for unexpected medical care. Almost a third have no savings accounts at all. – Thanks to this year’s flu season, Clorox sales hit an all-time high of $1.33 billion last quarter. - While wealthy Europeans prefer to park their extra cash in Switzerland, Americans tend to keep their offshore bank accounts in Panama and the balmy Caribbean. Britain, the Channel Islands, and Ireland are the second-tier offshore banking destination for people on both sides of the Atlantic. – The Economist Americans are hoarding their old phones. Only 20 percent of Americans sell or recycle their old cell phones, and more than half say they have two or more unused cell phones lying around. Collectively, those phones stack up to a trade-in value of $34 billion. –


Fingers Crossed: California Workers’ Compensation in 2013



ith the prospect of significant change to the California workers’ compensation system of benefits, Senate Bill (SB) 863 was swiftly approved. Proposed to improve benefits for most of the states injured workers while at the same time reducing costs, problematic facets of the former structure, such as the measurement of permanent disability; the compensation for permanent disability; the physician fee schedule; medical fees and billing schedules and the process used to resolve disputes over appropriate medical treatment, have all been included and will be scrutinized over the coming months and years, in an effort to gauge the true effectiveness of the reform. With over 14 million employees covered by California’s workers’ compensation system, reform was necessary to ensure a viable means for providing injured workers with the medical and indemnity benefits that are essential to a full recovery, while at the same time protecting the nearly 900,000 employers state wide. In their 2012 Annual Report, released by the California Commission on Health and Safety and Workers’ Compensation, an in-depth review of the reform affords the reader some very telling information regarding the current state of affairs and the overall likelihood of positive change for Of the 14 million insured the future. employees in the Golden All told, California insurers earned a whopping $10.4 billion in premiums from California employers State, nearly 525,000 of them reported occupational in 2012. With the deregulation of workers’ compensation premiums beginning in 1995, fierce injuries or illness to their competition ensued with nearly all California workers’ employers in 2012. compensation insurance providers slashing their rates to the detriment of many. Operating on paper thin margins and in many instances pricing their product below actual costs, insolvency soon followed as loss reserves were depleted and the impact of claims quickly overran many carriers, prompting the remaining few to quickly increase rates to meet costs and revive their dwindling surplus. Fast forward to the early part of 2000 and the legislative reforms which were implemented to control medical costs, update indemnity benefits and improve the assessment of permanent disability. The financial impact of these reforms was substantial, again lowering the cost of insurance and improving the overall profitability of the insurance carriers that were remaining. Having been fully realized, the savings have leveled out and workers’ compensation rates are once again on the rise, wreaking havoc state wide. As rates continue to climb, California business owners are scrambling for solutions with the hope that the benefits of reform will slowly rise to the surface. With the average medical and indemnity costs averaging 36% and 24% respectively, and expenses totaling 40% of the remaining distribution of insured employers’ workers’ compensation paid costs, skeptics will continue to scrutinize SB 863, expecting a significant drop in the expense column, as promised, in lieu of increased permanent disability benefits for California workers. Of the 14 million insured employees in the Golden State, nearly 525,000 of them reported occupational injuries or illness to their employers, ranging from minor medical treatment cases to catastrophic injuries and deaths. Recommendations by the CCHSWC include ensuring the adequate and timely delivery of medical benefits to injured workers’ and eliminating unnecessary costs, in addition to the State of California developing a “culture of safety” in the workplace. Additional efforts, to include Anti-Fraud measures such as stricter employer payroll reporting standards; workers’ compensation procurement monitoring; and the alignment of the California Labor Code definition of “first aid” with that of Cal/OSHA to eliminate a “barrier to compliance” and a “barrier to prosecution of willful violations”, are believed to be additional methods of lowering the overall cost of insurance in the marketplace. Despite all the efforts to mend a severely fractured system, California employers are just not convinced that enough is being done to thwart the financial impact of rising costs. Paul Cooley, co-owner of Cooley Construction, one of the area’s largest paving and grading contractors had this to say about the current conditions of the California workers’ compensation market: “It’s out of control, just like everything else in the State of California. It’s hard enough just to find work in this economy and many contractors I know are leaving the state. It’s just unbelievable.” Employers are keeping their fingers crossed as the full impact of the reform - for better or for worse - is yet to be seen. With the first quarter of 2013 coming to a close, keepers of work related injury data, like California’s Workers’ Compensation Insurance Rating Bureau are keeping close tabs on the numbers. With their Actuarial Committee slated to meet March 20, 2013, two items on the agenda include the SB 863 Cost Monitoring Plan and the impact of SB 863 on loss development. The results of their meeting should be interesting, to say the least.

Mike Nutter is the Senior Vice President of Sales with ISU Insurance Services-ARMAC Agency. Formerly the owner of a successful visual communications company, Mike’s thirteen years of entrepreneurial experience affords him a wealth of knowledge in all facets of business.



Weapons of Business Influence By: SAM THATTE

Editor’s Note: This is part one of a seven part series whereHDBJ will be taking a look at the six weapons of influence based on the book, “Influence-The Psychology of Persuasion” to offer practical suggestions to help local business owners learn new strategies and get fresh ideas on how to sell their audeince.

If you wish to unlock the secrets of great marketers, one of the keys is to understand the psychology of persuasion. Over the next 6 months we'll explore the six weapons of influence that can be used as a marketer to influence the buying habits of your ideal client as laid out in Robert Cialdini’s book: Influence – The Psychology of Persuasion. What the series will do is help you look inside the mind of your ideal customer. This will help you understand triggers that make customers buy and what makes a client say yes. We will show local businesses how minuscule changes in the way a message is put out can give drastically different results. The six weapons are Reciprocation, Commitment & Consistency, Social Proof, Liking, Authority and Scarcity. To function in this complex and ever changing world, our minds use triggers that help us make decisions. These triggers usually save us time when making decision. These are basic instincts that in some ways are common to all animals. Let's explore that angle for a bit. One of the most bizarre events that have been recorded by Dutch ethologist Niko Tinbergen, is a cardinal feeding small worms and insects to minnows in a small pond. This bird had lost its chicks to a predator and was responding to a basic parental instinct. Upon being stimulated by the sight of the small open mouths of the fish, the bird was doing what it was naturally programmed to do, feed open mouths! This is a clear demonstration of an inborn and stereotypical behavior in animals. These behavioral reflexes are displayed by all humans, even newborn babies. Try offering your finger to an infant and she will grab your finger in seconds. Another example of behavioral reflexes can be found in yawning. We are programmed to yawn when we see another person yawning. Yawns last for about 6 seconds and once they start, they are difficult to stop. Sometimes even reading the word "yawn" can trigger the action. The most interesting thing about this is how behavioral reflexes are activated. In the case of the cardinals and the fish, it is not the fish or even their chicks that triggers the behavior, it is the open mouths. In new-born babies, it is not a hand that is the trigger, it is the need of the infant to feel secure. It is not tiredness that triggers a yawn, it is a very basic instinct to mimic others to show them natural affinity. This all plays a role in business influence through basic trggers. The "Because" Trigger When we ask someone to do us a favor we are more successful when we provide a reason. This is the “Because” trigger. People like to have reasons for everything that they do. An experiment conducted by Harvard psychologist Ellen Langer, proved that not only does this work when you give an important sounding reason, but it also works if the reason is completely ridiculous. "May I use the copy machine before you because I have to make copies?" Worked just as well as, "May I use the copy machine before you because I am in a rush?" The "Contrast" trigger No matter what you sell, sell the main item first and then show the accessories that will improve the experience. Imagine being presented with two things one after the other. If the second item that was presented to you was very different from the first, you will see it as being even more different than it actually is. This is the essence of how the contrast principle of perception works. The "Expensive = Good" trigger We as a society have accepted that if something is expensive it is probably worth the money. "You get what you pay for!" is a common axiom when it comes to products and services we buy. Pick a product or a service you currently offer that does not sell very well. Now double its selling price. According to this trigger that product or service should now fly off your shelves. Keep in mind, this works best with items that are difficult to place a value upon.

Sam Thatte is a consultant, blogger and trainer featured on popular websites and blogs like and He produces helpful content on presentations and marketing on his own website at

How Businesses Can Find Their Social Media Audience By: ALYSSA PENMAN


s social media matures as a marketing channel, small business owners are realizing that it is here to stay and perhaps they had better start using it. According to the Wall Street Journal, in a Vistage Small Business CEO Survey in January 2013, 80% thought at least one of the major social media networks had potential to help their business. Where does a local business start when contemplating their social media strategy? The list of social media platforms available is so long that it can feel intensely overwhelming. There are three questions for businesses to consider when choosing a platform to focus on first: What would show off their product or service the best? What are they comfortable using, or able to learn? Where are their customers? Of those three, the most important is the last. No matter how pretty a page one puts together, or how well one uses that platform, if the people who want to put down money aren’t there, it doesn’t matter. Some information about where consumers are spending their time is available online. For example, according to BizRate Insights, 43% of Pinterest members agree that they use Pinterest to associate with retailers or brands with which they identify, compared to just 24% of Facebook users who agree to the same use with Facebook. The question then becomes, “How does a small business owner determine if their actual customers are using these social media sites?” FOUR Ways You Can Find Your Customers Online 1. Ask! Dedicate one week to asking every customer that comes in where they spend time online. Tell them the you are interested in offering deals and updates to your regulars and want to make sure you’re in the right spot. Enlist their help. 2. Do some footwork. Create a temporary Gmail account and import your email list. Use this account to create a temporary account on Facebook, Twitter and other social sites. There is almost always a way to find new friends or follows by importing your email contact list. Doing this successfully will let you know how many of your subscribers have an account on that platform. (You can delete the accounts you create after you get your number.) 3. Use a plugin like Rapportive. If you use Gmail, this is a great plugin. It turns the right hand side of your email into a little online bio of whoever you’re communicating with. You can start following people directly within your email. 4. Look at the demographics of your existing social media connections. Not every platform has this built in, and it is not always available for free from popular apps. However, Facebook definitely has this built in to your Insights. Take a look at the age and gender split of your fan base. Does it mirror who walks in the door and plops money down on your counter? If not, consider how to find and connect with your target a little better! Again, the best research is to go directly to your target and ask what kinds of information they want from a business like yours on Facebook. Social media may still frustrate a lot of small business owners. As a new-ish format, the rules aren’t as hard and fast as they are in newspaper, television or radio. The tools that have worked with customers previously seem heavy handed in social media settings. While change is uncomfortable, it can be done, and done profitably.

Alyssa Penman is a local business advocate and marketer who champions the independents of the Victor Valley through, and serves independent businesses nationally at She can be reached at


Disolving Cities What happens when city bankruptcy isn’t enough? By: ROBERT ISBILL


alifornia cities that have hit their fiscal bottoms have been turning to the Chapter 9 municipal bankruptcy process, including at least three California cities last year, Mammoth Lakes, Stockton, and San Bernardino. In California, municipal bankruptcies are virtually the only option for a cash strapped town. Fitch Ratings reports that California has an effective mechanism to support struggling schools, but they don’t have any such assistance for cities that are in the same boat. And then there’s, “Disincorporation.” The city of San Bernardino is on the record for looking into going a step further with the possibility of disincorporating, a viable option that might occur here in the High Desert considering certain local cities financial situations. Disincorporation is a municipal action where the county absorbs a city within and covers the debts. In California, seventeen cities have been disincorporated, including Long Beach and Pismo Beach. “It’s a very complex process. There’s a lot of speculation as to how that process would work,” said Kathleen Rollings-McDonald, CEO of the San Bernardino County Local Agency Formation Commission, or LAFCO. “There’s speculation about the city of San Bernardino itself, if the bankruptcy fails to produce the results, so they can come out of bankruptcy. Disincorporation may be their only option, and so there is discussion about that.” If a city is successful in disincorporating, “The city will just go away,” said McDonald. “Police powers and the rest will be assumed by someone else. If the city is not present, the county is the authority for law enforcement, (other) controls, maintenance of roads, and so to disincorporate, there would be a means to transfer all those things back to the county along with the revenue streams to support it.” This includes the water systems and parks and all would be assumed by a special district that could leave some semblance of local control or local government or could be placed under the Board of Supervisors governing. Plans of service would be required for disincorporation to be initiated, and someone would say what they envision that to be, said McDonald. Disincorporation comes with several additional drawbacks including, a county-controlled police department, sporadic road maintenance, no City Council and no recreation department. “There’s a requirement to analyze it and to develop a report and submit it to the Commission who has the ability to approve, modify or deny it. In order for it to move forward, it would require a vote of the people.” When a city disincorporates, there are still pensions and other financial responsibilities to consider. The cities have to provide for the payment of all its debts and the distribution of all its assets, said Attorney Michael Colantuano of Colantuano & Levin, PC in Penn Valley, California, who recently conducted a CALAFCO workshop. “Typically, that means the successor agency which could be the county, is protected from the debt by conditions of the disincorporation imposed by LAFCO that would require a taxing district to be established to pay those debts.” Federal law allows a city or other local government to seek bankruptcy only consistently with state law, so state law controls access to bankruptcy for local governments. Until about 2010 local government had absolute power to just do it. “AB 506 requires sort of a consultation process that has to take place before you can file bankruptcy. Stockton went through that process. Other than bankruptcy there’s no legal way to walk away from those obligations.” The existing statute was written pre-Prop 13, and presumes that property taxes would be used to pay those debts. So those provisions don’t work because Prop 13 caps taxes at 1%. Still, cities like San



Bernardino and Stockton who first filed bankruptcy before looking into disincorporation, are being watched closely. “Everybody is watching Stockton,” Colantuano said. “Because the banking creditors in Stockton are pushing the bankruptcy courts to cheapen up the pensions and spread the pain among the present and former employees of Stockton and its other creditors. CalPERS intervened in Stockton bankruptcy to defend the city’s contract with CalPERS, and everybody is watching very closely to see what happens there.” Across the state, cities are struggling to provide the services residents have come to expect with fewer revenues and staff. People are looking for a way out, according to Bill Chiat, executive director of the California Association of Local Agency Formation Commissions. "There certainly have been cities in this economic climate that have inquired about disincorporation," said Chiat. California law requires a procedure to disincorporate a city that involves four stages: Initiating of process; consideration by LAFCO; election, and completion of proceedings. The first step would be filing an application with LAFCO. A city submits a plan describing the level of services residents could expect if the city disincorporates. It would then go before the LAFCO commission, which would approve or deny the application. LAFCOs' current legal authority and mandate are defined by the Cortese-Knox-Hertzberg Local Government Act of 2000. “The Act “provides the “sole and exclusive authority and procedure” for the disincorporation of a California city”. There are twenty-four cities in the County of San Bernardino, and there are fifty-eight counties in the state of California. Problematic cities are not confined only to the state of California. Nor is the act of disincorporation. In a February 17, 2013 article in the Missouri Show-Me Daily newspaper, three Missouri towns have disincorporated in the last year: St. George, Mack’s Creek and Quitman. Local Agency Formation Commission (LAFCO) was established in 1963 by the State Legislature under the administration of Governor Edmund G. (Pat) Brown. Seventeen cities in California, including Long Beach, Pismo Beach, and Stanton have at one time or another disincorporated and subsequently reincorporated. However, only Cabazon has disincorporated under the auspices of LAFCO, and that was in Riverside County.

Bob Isbill is a Better Business Bureau Arbitrator, freelance writer, and Publicist for the High Desert Resource Network

Event Date: April 3 Register By: April 3 Time: 9:00 am - 11:00 am Contact: Kristen Gerke, (760) 951-1592 Event Location: Hesperia Branch Library 9650 7th Avenue, Library Conference Room, Description: If you are a new or aspiring business owner this workshop is a must! Discuss the steps to take towards starting your first business. The “How to Start Your Small Business” workshop is presented by an SBDC Business Consultant who will discuss informational topics such as: • Being an Entrepreneur • Business Planning • Small Business Financing • Legal Forms of Organization • Licensing and Permits Topic: Pre-business Planning Instructions: This seminar is sponsored by the City of Hesperia Enterprize Zone; class is FREE.


Event Date: April 10 Register: (760) 245-4271 x. 2522 Time: 8:00 a.m. -Noon Event Location: Victor Valley College Performing Arts Center 18422 Bear Valley Road Victorville. Description: The summit provides expert economic trend analysis and examines issues affecting businesses and investments in the region. The program this year will introduce a new multi-media presentation to showcase the collaboration of local cities in a regional economic development effort. This effort, which includes representatives from all communities in the High Desert. Get your event into the next issue. Send your information ro Mail@HDBJ.Biz



Cut Your Phone Bill by More than Half While Expanding the Capability of Your Business S

ince the invention of the telephone, AT&T and the “Baby Bells” have held a monopoly on phone services in the U.S. Businesses had no choice but to fork out sometimes hundreds of dollars a month per phone line for low quality scratchy audio and subpar customer service from the only source for their phone service. This has changed forever thanks to the Internet. The Internet is the backbone for Voice over Internet Protocol (VoIP) phone services, which is cheaper and in many ways better than the old POTS (Plain Old Telephone System). Skype, magicjack and Vonage are popular residential VoIP phone services with one thing in common, they’re cheaper than your home phone service. VoIP is cheaper as it uses the Internet to connect between phones and switching stations, which is much less expensive to install and maintain than physical phone lines used by POTS. However, the difference goes much further than the price tag of installation and maintenance. Features such as call waiting, call forwarding and 3-way calling are often available at an extra cost for a POTS, while all these features and more are usually free with VoIP. POTS business phones systems usually require expensive equipment and specialized knowledge to install and maintain. Trying to connect multiple locations, remote offices or home workers often requires complex engineering and is very expensive.


VoIP business phone systems utilize virtual equipment with very little physical equipment. Installation is a little more than plugging a phone into the Internet, which makes connecting to multiple locations, remote offices or home workers much easier and less expensive. The flexibility of VoIP virtual equipment provides for features and functions that cannot be done with POTS. For example, some businesses utilize VoIP to eliminate the need for a central office while still maintaining high quality customer service. An extension could be configured with relative ease to be a cell phone or a home phone located anywhere in the world. An incoming call can be answered by an automated attendant or by any extension which could be any of the aforementioned phones. This ability alone increases quality of customer service that rivals Fortune 500 companies while manned by just a handful of people. VoIP is a must for businesses placing a lot of international calls. Many VoIP services offer international calling plans that are pennies on the dollar compared to POTS. Also, VoIP can make a call from China sound like it’s coming from next door and the cost will be as if it was made next door. Some POTS plans still charge a hefty fee just for interstate calls with terrible sound quality. So, if you’re looking to dramatically reduce a fixed business expense while increasing your company’s capabilities at the same time, you need to take a serious look at VoIP phone services.

Dan Harley, Jr. has been immersed in technology all his life. Dan is an Internet solutions consultant, domain broker and affiliate marketer with clients located around the world. You can reach Dan through his web sites at,, or by email at:




Name, Address, Telephone, Fax, Website

Local Spring Enrollment 2013

Local Employees

Tution Cost Per Credit Hour

Degrees Conferred 2011


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Victor Valley Community College 18422 Bear Valley Road Victorville, Ca. 92395 760-245-4271/N/A

3,481 FTE


$45 per unit



San Joaquin Valley College 9331 Mariposa Road Hesperia, CA 92344 1-866-422-4054





University of La Verne 15447 Anacapa Road Ste. 100 Victorville, Ca. 92392 760-843-0086/760-843-9505




Azusa Pacific University 15283 Pahute Ave. Victorville, Ca. 92395 760-952-1765/ 760-952-1734



Brandman University 12421 Hesperia Rd #6 Victorville, CA 92395 760 955-7555


Representitive Programs

Top Executive/Title

Institution Accreditation

Year Founded Locally

William Studt Interim President

Western Association of Schools and Colleges (WASC), American Association of Community and Junior Colleges (AACJC)


A.A. and A.S. Degrees, Nursing, Liberal Arts, Science ,Math and Transfer Courses. 16 Career Technology Programs.

Dr. Christopher C. O’Hearn Superintendent

Western Association of Schools and Colleges (WASC), American Association of Community and Junior Colleges (AACJC)



Medical, Administrative, Pharmacy, Industrial Technology, Heating, Air Conditioning, Ventilation, & Refrigeration, Criminal Justice/Corrections, Business Administration,

D Mark Perry, President; Mike Perry, CEO



$520 per unit


B.achelor Degrees in Business Administraion, Liberal Studies, Child Development, Management, Public Administration. Graduate Programs Business, Education.

Devorah A. Lieberman, President

NCATE, NASPAA, ABA, CAATE and Credential programs are approved by the California Commission on Teacher Credentialing



$575 per unit Ed. Prog.


Bachelor Degrees in Nursing, Graduate programs in Education

Bob Flory, Interim Director




$500 credit hr. Bachelor Degree


Bachelor’s Degrees in Applied Studies, Business Admin,Early Childhood Development.




Lists were sent to all meeting and banquet facilities in the High Desert. Not all were returned by deadline. HDBJ relies on individual companies to be truthful and accurate in information submitted. To be surveyed for future lists, simply e-mail Abbreviations: Y/Yes - N/No - N/A Not Applicable -DNR/Did Not Respond



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Area’s largest:

Commercial Realtors Residential Realtors Appraisers Contractors Construction Companies Plumbers Architects Banks Credit Unions If this is you, send an e-mail to Mail@HDBJ.Biz. We will reply with a questionnaire so you will be included in both the Annual Book of Lists as well as our monthly publication highlighting your perspective field.

Contact us at MAIL@HDBJ.Biz

High Desert Business Journal  

April Edition

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