The Lane Report October Issue

KENTUCKY AG-TECH GETS A $150 MILLION JUMPSTART IN MOREHEAD

K E N T U C K Y ’ S B U S I N E S S N E WS S O U RC E FO R 35 Y E A RS

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OCTOBER 2020

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CONSTRUCTION STAYS BUSY, BUT VIRUS STILL A GAMBLE

Backlog and growing logistics demand keeps contractors on job; pandemic restricting 2021 pipeline

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OCTOBER 2020 Kentucky’s Business News Source For 35 Years

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Volume 35 Number 8

43

26 OWENSBORO’S BRIGHT JOBS PERFORMANCE City was only one of 389 U.S. metro areas in positive territory in June

28 FILLING THE DEMAND FOR DATA TECH WORKERS Upskilling is the hot word in Louisville for those looking for better jobs

32 INVESTING IN OPPORTUNITY

48

Blue Equity Chairman Jonathan Blue shares his company’s strategy for creating success

36 COVER STORY CONSTRUCTION STAYS BUSY, BUT VIRUS STILL A GAMBLE Backlog and growing logistics demand has kept contractors on job; pandemic is restricting the pipeline

43 ASSEMBLY PLANTS CHASE SALES DEMAND Auto dealers kept transactions rolling online during manufacturers’ spring shutdown

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48 AMERICA’S NEW PRODUCE SECTION $150 million AppHarvest project in Morehead looks like the jumpstart Kentucky ag-tech seeks

54 LOCAL TOURISM FUELS REBOUND ‘Stay Close, Go Far’ pitch proving successful for Kentucky’s smaller destinations

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Kentucky construction contractors report 2020 remains so far a surprisingly successful year for their business, and 2021 could be very strong—but it all depends on how the COVID-19 virus fight goes.

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On the Boards

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Focus on What Kentucky Has Growing State business sector making leaps forward, but beware of the rabbit holes

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HAT a distracting time for us all, including the business sector.

A dangerous pandemic has changed daily life in the workplace as well as at home, and it has slowed important parts of the economy while other areas operate almost normally.

Social protest continues, pushing for change also.

A national election takes place in less than a month with our country mired in a divisive, hyperpartisan political period of its history.

There is an onslaught of urgent information coming at Kentucky’s influencers and decision makers daily, demanding attention, demanding action. And parts of the news media, which is paid to attract your attention, report on our collective issues of the day by focusing on the conflict of opinion and perception. Additionally, some marketing messages around political and public policy campaigns and advocacy efforts present transparent misstatements of fact.

A fear or anger response is an underlying goal in some of this competition for your attention. Don’t take the bait, though. Public policy is truly important, but we don’t have time for conflict. If a message is asking you to think badly of fellow citizens rather than aiming toward a potential solution or improvement, consider whether it is worth your time and attention.

The Lane Report prefers to give you news that focuses on the improvements and potential solutions. It turns out to be a reliable way to get the attention of the business, professional and economic development community in our state, who are forever facing toward the future and how to enhance it.

Like the rest of the nation and world, Kentucky is making important improvements now that are worthy of knowing about. This year’s economic, financial and medical safety stresses are generating innovations and speeding a shift to new and more efficient processes. Many changes

initiated for safety reasons will be permanent for financial reasons.

There are important steps forward happening in our state, as you can read in this issue.

Louisville has multiple initiatives happening that are preparing its region’s workforce for the jobs of tomorrow. Partnerships with Microsoft and IBM are creating new curricula for what will be a steady pipeline of area residents skilled in gathering and assessing big data analytics that give business and medicine insight into how to perform better, skilled in directing and managing artificial intelligence in products and processes, in designing, building, operating and improving connected Internet of Things devices.

Job demand exists and this tech sector will grow as fast as workers can be skilled to fill it.

The state’s agribusiness sector has been a proving ground for innovation for many years, in part due to the challenges our varied geography present. Eastern Kentucky is about to open a transformative facility with the potential to change the U.S. food change for the better while bringing much-needed jobs to Appalachia.

State officials, entrepreneurs and academics have connected with the ag-tech sector in the Netherlands, which is exporting nearly $100 billion in products to the rest of the world.

Watch AppHarvest and its high-tech 60-acre greenhouse; if it is successful, many more will follow.

And the delayed Kentucky Wired project to put a network of gigabitspeed internet fiber nodes in every county of the commonwealth does, indeed, foresee completing its goal in the next few months. The focus then shifts to supporting final-mile connections that are the coming backbone of commerce.

Think about that. ■ Mark Green is editorial director of The Lane Report. Opinions expressed are those of the writer and not The Lane Report.

Kentucky is where products are made. With 4,500 manufacturing facilities statewide, anyone is sure to encounter Kentucky-made products on a daily basis.

It’s a major part of what makes Kentucky a premier destination for new and expanding businesses.

We also are the logistics center of the eastern U.S., perfect for getting products to their destination quickly, whether shipping domestically or internationally.

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FAST LANE A COMPILATION OF ECONOMIC NEWS FROM ACROSS KENTUCKY

LOUISVILLE

PAPA JOHN’S TO MOVE LARGE PORTION OF HQ OPERATIONS TO ATLANTA

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OUISVILLE-based pizza chain Papa John’s International has announced plans to open a new global headquarters in the Atlanta area but will keep its legal team, supply chain and information technology departments at its Louisville headquarters.

The Atlanta office will house menu innovation, marketing, customer experience, human resources, diversity, equity and inclusion, communications and development. Papa John’s also has a headquarters office in London, where its international operations are managed.

Papa John’s President/CEO Rob Lynch told The (Louisville) Courier-Journal that Louisville will remain the company’s largest headquarter hub and that approximately 550 of the 750 corporate jobs will remain in Louisville. Employees whose departments will move

to Atlanta will have the option to relocate or accept a severance package.

The decision to establish a third headquarters facility is part of the company’s broader strategy to reorganize its corporate functions. Lynch said Atlanta’s “deep talent pool and its world-class airport connecting us to the domestic and international market that are key to our brand’s future will accelerate our long-term growth.” Lynch has said the company plans to continue adding more stores internationally.

Atlanta is also home to Papa John’s largest corporateowned restaurant market and the location of its newest quality control center. The company is still is talks to select an exact location in the metro Atlanta area, but expects that decision to be determined by the end of the year and hopes to have the new office and related organization changes complete by next summer.

STATE Wilde Brands photo

NEW OPTION TO LOWER HEALTH COSTS FOR SMALL BUSINESSES

Wilde Brands’ chips—made from chicken—are high in protein and offer consumers an option to other high-carbohydrate snacks.

WINCHESTER

INNOVATIVE PROTEIN CHIP MAKER TO OPEN PLANT IN CLARK COUNTY

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young company that has developed snack chips made from chicken is investing $9.78 million to open a plant in Winchester that will bring 50 new jobs to the Central Kentucky community.

Wilde Brands Inc. makes high-protein chips that offer consumers a healthier alternative to potato chips.

The company has developed a proprietary production process using custom-engineered manufacturing equipment to produce the chips, which include flavors such as Nashville Hot, Chicken & Waffles, Himalayan Pink Salt, Buffalo and Jalapeno.

The company will operate in an existing 50,000-s.f. facility in Winchester that is expected to be operational by the end of the year. The facility will allow for increased production to expand sales and will also provide an opportunity for additional research and development to expand Wilde Brands’ product range. A first-to-marketpork chip is expected to launch on the company website in December and hit store shelves by January 2021.

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October 2020

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MALL businesses across Kentucky are now eligible for a discounted association health insurance plan through Humana thanks to a collaborative partnership between Greater Louisville Inc., Commerce Lexington and The Northern Kentucky Chamber. The Humana HealthSolutions plan being offered can save regional businesses up to 40% on health insurance premiums.

The plan is being offered to any Kentucky company that has two or more employees and an eligible SIC (Standard Industrial Classification Code). Businesses must join one of the three collaborating chambers to participate, but do not have to operate within the respective metro areas in order to join; each of the state’s 120 counties has been assigned to one of the three chambers. Upon joining the assigned chamber, businesses can then qualify for the discounted health insurance plan.

lanereport.com

GEORGETOWN

NEW TOYOTA VENTURE SUPPORTS E-LEARNING, SHOWCASES ADVANCED MANUFACTURING JOBS

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OYOTA Motor North America has launched a new virtual hub that takes visitors through many of its U.S. manufacturing facilities, creating an experience that is both entertaining and educational.

“We are excited to give the public a virtual look into our world at Toyota Kentucky, where they can learn about our foundational philosophies like kaizen and justin-time production and see how our best-selling products like the Camry, Avalon, RAV4 Hybrid and Lexus ES come to life,” said Susan Elkington, president of Toyota Motor Manufacturing Kentucky (TMMK). “We hope this experience will also inspire young people to explore careers in our industry and join our great team at Toyota Kentucky someday.”

The hub offers STEM (science, technology, engineering and math)-based lessons that explain the science behind some of Toyota’s core philosophies, which go beyond building cars and trucks. Visitors can also go behind the scenes at Toyota’s Research and Development center in Ann Arbor, Mich. or step into the Toyota Research Institute to discover how Toyota is building the future of mobility while harnessing the power of artificial intelligence to make driving safer.

“As educators face new challenges during this unique time, we hope these virtual experiences and free resources will provide students, teachers, parents, and life-long learners alike with engaging content that will help bring learning to life,” said Mike Goss, president of the Toyota USA Foundation.

All educational resources are provided at no cost and are available to the public by visiting tourtoyota.com/educationhub.

Ruben Sarabia-Riquelme, research engineer at UK CAER, works with the carbon fiber spinline.

LEXINGTON

CAER CARBON-FIBER RESEARCH SHOWING PROMISE FOR COAL

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NEWPORT

CHURCHILL DOWNS’ $38 MILLION NEWPORT FACILITY ON TRACK TO OPEN IN OCTOBER

lanereport.com

Churchill Downs/R2Architects photo

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HURCHILL Downs’ new racing and gaming facility in Newport is set to open its historical racing machine (HRM) and horse racing simulcast area to the public on Oct. 2.

The Newport site, located in the Newport Shopping Center off Interstate 471, is an extension of the racing license associated with Turfway Park in nearby Florence. The 47,000-s.f. space has been renovated as a contemporary entertainment center that includes 500 historical racing machines, a horse racing simulcast area and a bar.

HE University of Kentucky Center for Applied Energy Research (CAER) and the U.S. Department of Energy’s Oak Ridge National Laboratory (ORNL) are teaming up on a $10 million project to transform coal into high-value carbon fibers and composites.

According to information released by UK, coal-to-carbon fiber research shows great promise to positively impact the nation’s sluggish coal industry.

In 2019, U.S. coal production, consumption and employment reached their lowest levels in 40 years, a trend that is likely to persist as coal continues to lose market share to natural gas and renewable generation in the electric power sector.

However, recent studies suggest that U.S. coal utilization for coalto-products applications has the potential to reach utilization levels on the same order of magnitude as that of steam coal.

The market for carbon fibers continues to grow, driven by increased use in aerospace and defense applications as well as lightweighting of automobiles.

New market growth in other highvolume applications—such as thermal insulation for buildings and materials for construction and infrastructure—also show great promise. The market for carbon fibers is expected to grow at a compound annual growth rate of 12% through 2024.

October 2020 7

FAST LANE

BUSINESS BRIEFS

LOUISVILLE

BRIGHTSPRING EXECUTIVE NAMED A TOP 25 INNOVATOR FOR 2020

BOWLING GREEN n Pan-Oston, a Bowling Green-based company that produces display racks, check-out lanes and other store fixtures for retailers, has expanded its product line-up to meet the changing needs of stores adapting to COVID-19 restrictions. The company has teamed with the Kentucky Thermal Institute at the Western Kentucky University Center for Research and Development to create a mobile “Elevated Body Temperature Screening Kiosk” that can be placed in high-traffic areas ranging from stores and business to schools, hospitals, hotels, gyms, restaurants and more. The new Protective Product Solutions by Pan-Oston line also includes a shopping cart sanitation system, a mobile hand sanitizer and disinfectant station, acrylic protective shields and hands-free door openers.

Pan-Oston photo

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Amazon photo

ERLANGER n Amazon has opened a new 575,000-s.f. sort center in Erlanger, near the Cincinnati/Northern Kentucky International Airport.

The new facility, which has created more than 1,000 direct jobs, will sort packages before being transferred to a delivery station or last-mile delivery partner for final delivery to customers.

FLORENCE n Texas logistics technology and services provider Transplace has acquired LeanCor, a Florence-based company that provides managed transportation services, supply chain consulting and corporate training programs to help businesses eliminate waste and decrease costs. “Combining our expertise with Transplace is the perfect next step and growth opportunity for our team members and our customers,” said LeanCor CEO Robert Martichenko.

HEBRON n DHL Express is in the process of adding 600 new operations positions and 50 new management positions at its Americas hub, located at the Cincinnati/Northern Kentucky International Airport.

The additional jobs are being added to help meet increased demand as the global pandemic pushes more people to shop online.

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October 2020

M&M photo

COVINGTON n M&M Service Station Equipment Specialist Inc. is investing more than $3 million to buy and renovate a 100,700-s.f. building in Covington for its new headquarters facility. M&M, which currently has its headquarters in nearby Newport, is a familyowned company started in 1989 that builds and services gas stations for companies such as Speedway, Marathon, Thornton’s, Love’s and Pilot. The company has locations in Kentucky, Indiana and Ohio. M&M will move 48 employees to the new headquarters and plans to add 16 new jobs over the next several years.

USAN Sender, chief clinical officer for Louisville-based BrightSpring Health Services, has been recognized by Modern Healthcare as one of its Top 25 Innovators for 2020. Modern Healthcare is a weekly business publication targeting Susan executives in the health care industry.

Sender The Top 25 Innovators program recognizes leaders who are instituting innovation and leading transformative programs that improve care by achieving measurable results and contributing to the clinical and financial goals of their organizations. The honorees were selected for their work in one of four areas of focus: consumerism, cost reduction, population health, and quality and safety.

Modern Healthcare’s profile of Sender notes that she “is known for her expertise in establishing clinical standards and oversight of regulator compliance, professional development ensuring accurate reimbursement and policy development.”

Sender joined BrightSpring in 2019 from Amedisys Home Health Care and Hospice, where she served as senior vice president and chief clinical officer. Prior to that, she served in the same capacity for Kindred Health Care.

GRAVES COUNTY

HVAC DISTRIBUTING ADDING 2ND LOCATION, 175 JOBS IN HICKORY

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VAC Distributing LLC is investing $7 million to purchase and outfit a 100,000-s.f. spec building in the Hickory Industrial Park for its second Graves County location.

The expansion will help the family-owned Hickory company accommodate both recent and anticipated market growth. The company provides logistics support to its sister company, Ingram’s Water & Air Equipment, and distributes products throughout the nation for rapidly growing brands such as MRCOOL and GeoCool, among others.

HVAC Distributing currently operates a 113,000-s.f. facility that employs 100 people. The expansion will add another 175 jobs. lanereport.com

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FAST LANE

BUSINESS BRIEFS

HIGHLAND HEIGHTS

LEXINGTON n The Breeders’ Cup, one of Thoroughbred horse racing’s most prestigious international events, has selected Keeneland Race Course to host the championship event in 2022.

The 2022 event will mark the third time Keeneland has been selected as host since i t first welcomed the Breeders’ Cup in 2015. Keeneland is also scheduled to host this year’s world championship event on Nov. 4-5, but on-site attendance will be limited to essential personnel and participants only due to COVID-19. n Rhino Resource Partners LP, a Lexington-based company that owns coal and energy-related assets in Kentucky, Ohio, Virginia West Virginia and Utah, has filed for Chapter 11 bankruptcy. In a statement announcing the decision, Rhino said it “intends to use the bankruptcy process to implement an orderly sale of substantially all of its assets in an effort to maximize value for all stakeholders and allow for the prospect of continued employment and business opportunities at its operating locations.”

American Airlines photo

n American Airlines has announced plans to offer nonstop seasonal flight service between Lexington and Miami. The service will begin Nov. 7 and will operate every Saturday through April 3, 2021. n Unified Trust, a national retirement plan provider and fiduciary headquartered in Lexington, will become part of American Trust Co. as part of a recently announced agreement.

American Trust is a subsidiary of EdgeCo Holdings, a provider of technology-enabled retirement solutions. Unified Trust founder Dr. Gregory Kasten will serve in an executive role and on the board of directors for American Trust once the acquisition is complete. The combined company will retain a trust office in Lexington as well as offices in Memphis and Dubuque, Iowa. n Gray Inc., the holding company for Lexington-based Gray Construction and nine other Gray companies, has acquired Anderson Dahlen, a 75-year-old family-owned company that is a specialty equipment manufacturer and custom stainlesssteel fabricator for the food and beverage, pharmaceutical, industrial and vacuum technology markets. Anderson Dahlen will maintain its Minnesota headquarters and will continue operations under its current leadership.

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October 2020

NKU OFFERS NO-COST SUPPORT FOR FAMILY-OWNED BUSINESSES

NKU photo

HIGHLAND HEIGHTS n Northern Kentucky University and the City of Covington have unveiled an innovation hub for businesses and entrepreneurs to accelerate economic growth in the area. The Collaborative for Economic Engagement will leverage regional agencies and programs as well as NKU’s expertise in data analytics, health, logistics and entrepreneurial innovation to provide tools that entrepreneurs need to thrive. NKU is utilizing Covington’s Innovation Alley space on West Pike St. to create a “front door” for entrepreneurial engagement and outreach, counseling and mentorship, and programming and education.

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ORTHERN Kentucky University h as created a new relief program to help local, family-owned small businesses adapt to the disruptive climate created

by COVID-19.

NKU’s Haile/US Bank College of Business will help implement technologybased tools and services—from integrating accounting software to developing websites—at no cost, thanks to funds provided by the Drees Family Foundation.

“We see more businesses that are negatively impacted by the ongoing pandemic, and many of them do not have the resources to pivot in our digitally centric world,” said Hassan HassabElnaby, dean of the College of Business.

NKU’s Center for Innovation & Entrepreneurship will lead each project, and its Small Business Development Center will provide business coaching. Students are also playing a vital role by leading and executing projects under faculty guidance.

Participants must be clients of NKU’s Small Business Development Center and be located in Boone, Campbell, Gallatin, Grant, Kenton or Pendleton counties.

LOUISVILLE

WAYSTAR’S LATEST ACQUISITION EXPANDS MEDICARE ANALYTICS

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AYSTAR, a Louisville-based provider of health care payment software, has announced plans to acquire eSolutions, a Kansas revenue-cycle technology company that offers solutions specific to Medicare. The acquisition will make Waystar the first technology to combine both commercial and government payers onto a single platform, which will create significant efficiencies and enable clients to free up time to deliver health care.

Medicare has become the largest payer in the nation and as baby boomers age, the mix of insurance coverage is increasingly shifting to Medicare. Historically, providers have had to leverage two different systems— one for commercial claims, and another for Medicare.

The acquisition of eSolutions will be the sixth acquisition for Waystar within the past couple of years.

Waystar currently supports more than 450,000 providers, 750 health systems and 5,000 payers and health plans. The eSolutions acquisition is expected to close later this year. lanereport.com

BUSINESS BRIEFS

LOUISVILLE

CONSTELLATION BUYS REMAINING INTEREST IN COPPER & KINGS

LEXINGTON n Bluegrass Community and Technical College has partnered with Northside Family RV in Lexington to create a recreational vehicle service technician apprenticeship program.

Apprenticeship partnerships allow participating employers to spend less time and fewer financial resources to attract, onboard and retain talent.

BELLARMINE TO MATCH TUITION OF FLAGSHIP PUBLIC UNIVERSITIES

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ELLARMINE University has unveiled a unique new scholarship to attract students from across the country. The Public Price Promise will match the direct cost of qualifying students’ state flagship university.

For example, in Kentucky, Bellarmine will match UK’s tuition, fees, room and board.

Ac c o rd i n g to Bellarmine, the program typically reduces the cost of attending Bellarmine by as much as half.

The new scholarship is in keeping with Bellarmine’s strategic plan, unveiled last year, which calls for the university to expand its growing geographic reach and diversify enrollment. Bellarmine’s current first-year class hails from 23 states and three nations.

The Public Price Promise will go into effect beginning fall 2021.

lanereport.com

Norton Brownsboro Hospital photo

LOUISVILLE

LOUISVILLE n Falls City Brewing Co. has completed a multimillion expansion of its brewery in downtown Louisville that triples the company’s full-scale brewing capacity and allows it to brew and package all of its products under one roof. The upgrade, which includes a new canning line and increased cold storage, also uses 40% less water and 20% less grain. n Norton Brownsboro Hospital has completed phase one of a $167 million project that adds 172,000s.f. of space and 70 new private patient rooms. The expansion also includes a new emergency department and six additional operating rooms, two of which are biplane rooms used for neurological procedures such as strokes and aneurysms. The bi-plane rooms are outfitted with the latest imaging technology approved by the FDA, making Norton Brownsboro one of only 12 hospitals in the nation to have it. n The James Graham Brown Foundation is committing up to $10 million over the next 18 months to support nonprofit organizations struggling in the aftermath of the COVID-19 pandemic. The funding will provide relief to organizations that support education and workforce, community and economic prosperity, and quality of life. As of early September the foundation had already granted more than $15 million, the majority of which was presented in response to the COVID-19 crisis and its aftermath. n Greater Louisville Inc. (GLI) has launched a new technology network to support and grow the region’s technology ecosystem.

The TechFirst network will be chaired by Stacy Griggs, CEO of El Toro Internet Marketing, and will focus on areas such as business attraction and retention strategies; creating support for business development, innovation and entrepreneurship; and showcasing Greater Louisville’s tech-savvy culture.

MORGAN COUNTY n Road crews are continuing to work on the Mountain Parkway expansion in Morgan County. Currently under construction is the 134-W bridge, which will cross over KY-134 near mile marker 60.2 Later this year, crews will begin tearing down the existing 134E bridge to construct a new bridge in its place. The final surface layer for new pavement near the Morgan-Magoffin County line is expected to be complete next spring.

October 2020 11

Falls City photo

Constellation photo

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ONSTELLATION Brands Inc., an international producer and marketer of beer, wine and spirits, has acquired Louisville-based Copper & Kings American Brandy Co. for undisclosed amount.

Copper & Kings was founded in 2014 by beverage industry entrepreneurs Joe and Lesley Heron, and uses small batch copper pot-distillation and unconventional methods, like sonic aging and solera blending, to craft a variety of non-traditional and innovative spirits. The company has had a working relationship with Constellation for several years as Constellation has held a minority interest in Copper & Kings since 2017. Constellation’s portfolio also includes well-known brands such as Corona, Robert Mondavi, and Svedka.

FAST LANE

BUSINESS BRIEFS NICHOLASVILLE n Nicholasville-based R.J. Corman Railroad Group is expanding its holdings with the acquisition of Owego and Harford Railway Inc., Lehigh Railway LLC, and Luzerne and Susquehanna Railway Co., as well as TranZ, a transload service provider that operates on the short-line railroads. The three short-line railroads, which operate in New York and northern Pennsylvania, haul a variety of freight and together transport over 14,000 carloads annually.

With the latest acquisition, Corman will own and operate 17 short-line railroads in 11 states.

WARREN COUNTY

BOWLING GREEN RANKS AMONG TOP U.S. MANUFACTURING CITIES

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OWLING Green ranks as one of the nation’s top cities for manufacturing, according to a recent listing published by Global Trade Magazine.

In 2017, approximately 17% of the city’s workforce was in manufacturing (up from 14.4% in 2012) and the sector is responsible for over $1 billion in exports. The magazine also lauded the wide diversity of the city’s manufacturing base.

“We have over 85 languages spoken in our community.

Furthermore, we have 22 international manufacturing companies representing nine different countries located within the city,” said Bowling Green Area Chamber of Commerce President/CEO Ron Bunch.

That diversity, added Bunch, makes the community a key destination for manufacturers looking to expand or open new facilities in the United States.

Currently, Bowling Green’s largest manufacturers are Bowling Green Metalforming, General Motors Corvette Assembly Plant, Henkel AG & CO, Kobe Aluminum Automotive Products, Country Oven Bakery and Trace Die Cast. Those six facilities alone employ over 5,200 people and produce an economic impact that exceeds $14.4 billion.

GM photo

OWENSBORO n The O.Z. Tyler Distillery is now operating as Green River Distilling Co., a change that takes the distillery back to the original name chosen by founder John W. McCulloch in 1885.

To celebrate the change, a limited release of Green River 4-Year Kentucky Straight Bourbon will be available in 2021.

RICHMOND n A Senate Ad Hoc Committee at Eastern Kentucky University has awarded $23,000 in grant funding to three departments and four faculty who have developed zero-cost textbook courses that will help approximately 4,500 EKU students save a combined $333,000 each year. The average textbook cost for the classes is $81.

WILDER n Maxim Crane Works, one of the largest lift and crane businesses in North America, has acquired the United States assets of a Canadian company as part of its strategy to expand its western region. The addition of NCSG Crane and Heavy Haul’s U.S. assets provides new locations for Maxim in Billings, Sidney and Great Falls, Mont. Maxim, which has its operational headquarters in Wilder, has 58 other locations across the United States.

STATE n Kentucky’s largest metro areas rank among the most affordable in the nation when it comes to rental costs, according to data released by SmartAsset. The listing puts the Cincinnati metro area—which includes the Northern Kentucky Metro—as the No. 1 area of the country where renters can most easily afford to live alone, with the average monthly rent running $618 for a unit with fewer than two bedrooms. Lexington ranked No. 7 on the list ($646) and Louisville came in at No. 21, with an average monthly rent of $659.

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October 2020

STATE

KFB OFFERING FREE WI-FI TO HELP WORKERS AND STUDENTS

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KFB photo

WILMORE n Walt and Rowena Shaw have donated $10 million dollars to Asbury University, breaking the record for the largest single gift in the university’s 130year history. The gift completes funding for Asbury’s new Collaborative Learning Center, which will unite the university’s STEM (science, technology, engineering and math) programs with the Howard & Beverly Dayton School of Business. The Shaws are alumni of Asbury and the founders of Avanti Polar Lipids Inc., an Alabama-based company specializing in lipid products (including a product used in COVID-19 vaccine research) that recently sold to an international health care company. Construction on the $26 million Collaborative Learning Center will begin this fall.

ENTUCKY Farm Bureau has activated a free, public WiFi internet signal from 155 of its locations statewide and will be making the same signal available at its remaining 42 offices in the coming weeks.

The move is an effort to help Kentuckians without reliable broadband internet service who need to complete work and school assignments outside the traditional workspaces due to COVID-19. The free network (KFBFreeWiFi) is accessible from the parking areas around KFB buildings between 7 a.m. and 10 p.m. daily. lanereport.com

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INTERSTATE LANE BUSINESS NEWS FROM NEIGHBORING STATES

BUSINESS BRIEFS

INDIANA

FOREST RIVER TO EXPAND RV PRODUCTION, WILL ADD 369 JOBS

Mission Foods photo

INDIANA n Mission Foods is establishing a new tortilla manufacturing facility in Plainfield, Ind., that will create up to 544 new jobs by the end of 2026. The Texasbased company plans to lease and equip a 510,954-s.f. facility that will have the potential to produce 188 million pounds of food annually. Mission expects to begin operations in early 2021 and be fully operational by 2024.

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n Corsicana Mattress Co. is investing more than $8.6 million to lease and equip a 165,000-s.f. facility in La Porte, Ind., that will house the company’s growing boxed-bed manufacturing.

The Dallas-based company has been in business since 1971 and currently operates 10 production facilities across the United States. Indiana’s centralized location provides Corsicana with access to key markets and allows for same-day shipping. The company expects to have the plant operational by the end of 2020 and plans to hire up to 350 people by the end of 2023.

OHIO n Alcorta Forging Group, a 100-year-old Spanish automotive supplier, is investing $25 million to establish its first U.S. manufacturing plant and a regional headquarters office in Marysville, Ohio, near Columbus. The 150,000-s.f. forging and manufacturing plant will initially employ 50 people and will produce parts locally that are currently imported from Europe.

SCT photo

TENNESSEE n Southern Champion Tray is building a new manufacturing facility in Chattanooga that will convert paperboard into packaging products such as food sleeves, trays, cupcake inserts and a newly introduced item, tamper-evident food packaging for use by restaurants and food delivery systems. The family-owned, Chattanooga-based company currently employs more than 750 people and will add another 120 jobs as a result of the $85 million expansion. n Domtar, a South Carolina-based company that produces fiberbased products such as specialty and packaging papers and absorbent hygiene products, is investing more than $300 million to convert its Kingsport, Tenn., operations from producing uncoated freesheet paper to the production of container-board products made from 100% recycled cardboard. The project is expected to be complete in early 2023. The converted mill will employ approximately 150 people.

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October 2020

Milwaukee Tool photo

n Milwaukee Tool is establishing a new tool service hub near Indianapolis that will bring more than 450 new jobs to the area by 2025. The Wisconsin-based company is investing $6.75 million in the project and is leasing 150,000 s.f. of space in Greenwood that will house tool repair and warehousing space. The facility is expected to be operational by March 2021.

NDIANA-based RV manufacturer Forest River is increasing its manufacturing footprint in northeast Indiana, where it plans to add up to 369 new jobs to support Forest River’s new manufacturing facility in Butler, Ind., will give the expansion.

Forest River is the company space to expand investing $3.5 million production of its new line of RVs designed to also transport outdoor to expand its 20- equipment like motorcycles and acre manufacturing four-wheelers. campus in Butler, where it will build a new 63,000-s.f. production facility and expand its existing 30,000-s.f. building. The new facilities will enable Forest River to expand production of its XLR Toy Hauler, the company’s newest line of Toy Hauler recreational vehicles.

The company is also planning a $3.5 million expansion of its facility in LaGrange, where it is constructing a 95,000-s.f. building to increase manufacturing capacity for its Cherokee RV line.

OHIO

NATIONWIDE LAUNCHES NEW INSURANCE FOR CAREGIVERS

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OLUMBUS, Ohio-based insurance company Nationwide has introduced a new stand-alone paid-leave insurance plan designed to support employees who need an extended or intermittent leave from work to tend to family members.

N a t i o nw i d e said Caregiver Family Leave Insurance (CFL) addresses a common insurance gap and provides a solution that is compatible with most employers’ Family Medical Leave Act (FMLA) requests.

According to a 2019 survey conducted by Harvard Business School, more than 70% of employees reported having some type of current caregiving responsibility and are faced with the dilemma of choosing between what is best for their families and wage loss.

The new insurance product is available to employers in 18 states, with more states expected to roll out in the coming months. lanereport.com

CORPORATE MOVES NEW LEADERSHIP FOR KENTUCKY BUSINESSES

BIG MOVES n Connected Nation, a Bowling Green-based nonprofit company that helps provide access to broadband and related technologies, has announced the following promotions: Chris Pedersen has been promoted to executive vice president, development and planning. Pedersen will serve as the primary relationship manager for placement Chris Pedersen and development of broadband programming both nationally and internationally, and will work with public and private-sector leaders to identify broadband needs.

Brent Legg has been promoted to executive vice president, government affairs.

Legg is responsible for the organization’s strategic public policy Brent Legg agenda and works with federal, state and local officials to advance legislation and/or executive actions that improve the access and quality of broadband service. n Jack Woodruff, founder of Lexingtonbased Woodruff Commercial Properties, has achieved the designation of Certified Commercial Investment Jack Member. The CCIM Woodruff designation recognizes individuals who are experts in commercial real estate brokerage and investment analysis.

ARCHITECTURE/ ENGINEERING n Steve Precourt has been named president of SynTerra Corp., a Lexington science and engineering consulting firm.

Steve Precourt

n Morgan Hawker has been named senior project manager for Louisvillebased Luckett & Farley’s industrial design studio.

Brad Taber

Diana Lord

October 2020

Clint Hill

n Lexingtonb a s e d Central Bank has announced the following promotions: Becky Mark M a r k Mullins Kendall Kendall has been promoted to assistant vice president, financial planning. Becky Mullins has been promoted to assistant vice president, special assets. n Juliann Jones Irwin has been named vice president of marketing and customer experience for Winchester-based Peoples Exchange Bank. n Sabrina Lequire has joined Community Trust and Investment Co. as a wealth adviser for private wealth services. n Kimberly Halbauer has been named regional president over Fifth Third Bank’s Kentucky region.

She succeeds Mike Ash, who has been named president of the bank’s Indiana region. n Ashley Duncan has joined Louisville-based Republic Bank & Trust Co. as vice president, director of inclusion and diversity.

CONSTRUCTION n Tyler Cundiff has been promoted to president of Lexington-based Gray Inc.’s food and beverage market.

Morgan Hawker 16

BANKING n Henderson-based Field & Main Bank has announced the following promotions: Brad Taber – chief information officer, vice president; Diana Lord – director of information technology, assistant vice president; and Clint Hill – director of digital banking, assistant vice president.

ECONOMIC DEVELOPMENT n Steven Cabezas has joined One Southern Indiana (1si), the chamber of commerce and local economic development organization for Clark and Floyd counties, Ind. EDUCATION n Tony Faiola has been appointed associate dean of research and scholarship at the University of Kentucky College of Health Sciences. n Jon Thorson has been Tony Faiola named chief scientific officer and associate dean for research at the University of Kentucky College of Pharmacy. n Erin D. Jarrett has been named director of counseling services at Campbellsville University. n Carrie Knott has been named director of the University of Kentucky’s Research and Education Center in Princeton, Ky. n David McFaddin has been named as Eastern Kentucky University’s 14th president.

Juliann Jones Irwin

Ashley Duncan

Tyler Cundiff

David McFaddin

n Kirsten Turner has been named vice president for student success at the University of Kentucky. n Jerton Evans has been named as the University of the Cumberland’s first director of diversity and multiculturalism.

Kimberly Halbauer

Erin D. Jarrett

n Cicely J. Cottrell has joined Spalding University as director the university’s criminal justice studies program.

Jerton Evans

Cicely J. Cottrell

n Joe Reed has been named chief accountability officer and audit executive for the University of Kentucky. n Nancy Cox, dean of the University of Kentucky College of Agriculture, Food and Environment, has been assigned to take on the additional role of vice president for land-grant engagement. n George Wright has been named senior adviser to the president at the University of Kentucky.

lanereport.com

FOOD/SPIRITS/HOSPITALITY n Swizzle Dinner & Drinks, a newly opened restaurant atop The Galt House Hotel in Louisville, has announced the following appointments to its leadership team: James Wilfong – chef de cuisine; Michael Putnam – executive chef; Kendall Linhart – executive sous chef; Westley Harris – general manager; John Templeton – assistant general manager; and Latina Haley – restaurant sales manager.

GOVERNMENT n Monique Williams has been n a m e d director of Louisville’s Office for Steven M. Safe and Monique Williams Kelsey Healthy Neighborhoods (OSHN). Steven M. Kelsey, a retired Louisville Metro Police officer and Louisville minister, has been named as the faithbased liaison for the OSHN. n Todd Allen has been appointed general counsel for the Kentucky Department of Education.

Todd Allen

n Kelly Stephens has been appointed clerk for the Supreme Court of Kentucky. n Dorsey Ridley has been named executive director for the Governor’s Office of Agricultural Policy.

HEALTH CARE n Ashley Herrington has been named as the top administrator for Twin Lakes Regional Medical Center in Leitchfield.

Herrington succeeds CEO Wayne Meriwether, who is retiring. n Dorothy Lockhart has been named vice president of CHI Saint Joseph Health Partners. n Debbie Miller has joined Masonic Homes Kentucky as the new community liaison at Sam Swope Care Center.

Kelly Stephens

Ashley Herrington

Dorothy Lockhart

n Robert Canina has been named system executive director of construction and energy services for Baptist Health. n John Walsh as been hired as chief administrative officer of UofL Health– Jewish Hospital.

n Heather Suell Stewart has been named executive director of Kentucky Harvest Inc., a Louisville nonprofit that gathers excess food from restaurants and caterers and distributes it to those in need.

Robert Canina

n Adam Ogle has been named director of the Baptist Health Lexington Emergency Department.

Adam Ogle INSURANCE n Whitney F l o y d has been n a m e d president of Hendersonbased Field Justin & Main Whitney Floyd Latta Insurance.

Justin Latta has been named vice president of the company.

LEGAL n Lexy Gross has joined the litigation and dispute resolution team of Wyatt, Tarrant & Comb’s Lexington office. Elizabeth Penn has joined the firm’s corporate and securities team in Louisville. n Tony Coleman has joined the Louisville law office of Dinsmore & Shohl LLP. NONPROFIT n Brandon Wilson has Tony joined Louisville-based Coleman nonprofit WaterStep as a special project consultant. Kate Horton has joined the organization as a development associate. n Kathey Sanders has been appointed executive director of the Cedar Lake Foundation, a Louisville organization that provides care for those with intellectual and developmental disabilities.

Kathey Sanders

n Nicole Love has been named director The Salvation Army Early Learning Center in Lexington.

n Tom Shelton has been named executive director of the Henry Clay Center of Statesmanship in Lexington. n Bernheim Arboretum and Research Forest in Clermont has promoted Renee Hutchison to director of visitor experience.

Renee n Erica Beasley has Hutchison been named director of development for Goodwill Industries of Kentucky.

REAL ESTATE n Fred Fiscus has joined Remmco Property Management in Lexington as a property manager.

TRANSPORTATION Fred Fiscus n Carrie Butler has been named executive director of the Transit Authority of River City in Louisville.

UTILITIES n Robert Money has been appointed manager of water quality and environmental compliance for Kentucky American Water.

OTHER n Brittani Cushman has been named general counsel for Turning Point Brands, a Louisville-based provider of tobacco and tobacco-related products. Cushman succeeds James Dobbins, who will retire Oct. 31, 2020. n Mary Harville has been named as the new president and chief executive officer of the Kentucky Lottery Corp. She succeeds Tom Delacenserie, who retired in March.

DEPARTURES n Owensboro Health President and CEO Greg Strahan and Chief Financial Officer John Hackbarth have announced plans to retire simultaneously, effective Feb. 1, 2021. n Stephen Reily has announced plans to step down as director of the Speed Art Museum in Louisville in March 2021.

Nicole Love Debbie Miller

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October 2020 17

ON THE BOARDS KENTUCKIANS NAMED TO ORGANIZATIONAL LEADERSHIP ROLES

ASSOCIATION OF TECHNOLOGY, MANAGEMENT AND APPLIED ENGINEERING n Thomas Buteyn has been elected as the Thomas student member of the Buteyn board of directors for the Association of Technology, Management and Applied Engineering, a collegiate accrediting agency and professional organization. Buteyn, of Somerset, is pursuing a master’s degree in engineering and technology management at Morehead State University.

CHARITABLE GAMING ADVISORY COMMISSION n Jim Sichko has been appointed to serve on Kentucky’s Charitable Gaming Advisory Commission. Sichko is a priest for the Catholic Diocese of Lexington and papal missionary for Pope Francis.

COMMISSION ON HUMAN RIGHTS n Timothy Thomas, Frank Smith and Lisa Chaney have been appointed as members of Kentucky’s Commission on Human Rights. Thomas, of Madisonville, is a funeral director. Smith, of Louisville, is a pastor and vice president at Simmons College of Kentucky. Chaney, of Willisburg, is the president of Impetus Consulting.

COMMISSION ON SMALL BUSINESS ADVOCACY n Lesa Seibert and Joshua Ravenscraft have been appointed to serve on Kentucky’s Commission on Small Business Advocacy.

Seibert, of Louisville, is the owner of Mightily. Ravenscraft, of Morehead, is the founder of New Frontier.

ENDEAVOR n Joe Kelley and Brian Brackeen have been appointed to the board of directors for the Louisville regional office of Endeavor, an organization that provides support for entrepreneurs around the world. Kelley is president and CEO of Kelley Construction Inc. Brackeen is a general partner at Lightship Capital, a Cincinnati-based venture capital firm that works with underrepresented entrepreneurs in the Midwest.

FUND FOR THE ARTS n Carolyn Purcell Michener has been appointed to the NeXtGen Board of Louisville’s Fund for the Arts. Michener is an attorney with the law firm of Stites & Harbison PLLC.

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Carolyn Purcell Michener

October 2020

JUVENILE JUSTICE OVERSIGHT COUNCIL n John Adams, Tyra Walker and John Ward have been named to Kentucky’s Juvenile Justice Oversight Council. Adams, of Hopkinsville, is a district judge for the Commonwealth of Kentucky. Walker, of Louisville, is a teacher for Jefferson County Public Schools. Ward, of Elizabethtown, is the sheriff in Hardin County.

KENTON COUNTY AIRPORT BOARD n Dale Losey has been appointed to the Kenton County Airport Board, which oversees the operations of the C i n c i n n a t i / N o r t h e r n Dale Losey Kentucky International Airport. Losey is chief financial officer for Chavez Properties.

KENTUCKY AGRICULTURAL FINANCE CORP. n David Rink and Mac Stone have been named to the Kentucky Agricultural Finance Corp. Board of Directors. Rink, of Finchville, is a corporate banker at Old National Bank. Stone, of Georgetown, is a farmer.

KENTUCKY AUTHORITY FOR EDUCATIONAL TELEVISION n Leah Adkins has been appointed as a member of the Kentucky Authority for Educational Television.

KENTUCKY BOARD OF ALCOHOL AND DRUG COUNSELORS n Bruce Dudley has been appointed as a member of the Kentucky Board of Alcohol and Drug Counselors. Dudley, of Louisville, is an attorney with the firm of Wyatt, Tarrant and Combs LLP. KENTUCKY BOARD OF EDUCATION n Randy Poe has been appointed to serve on the Kentucky Board of Education. Poe, of Union, is the executive director of the Northern Kentucky Education Council and previously served as superintendent of the Boone County school system until his retirement in June 2020.

KENTUCKY BOARD OF HOME INSPECTORS n Ralph Halcomb has been appointed as a member of the Kentucky Board of Home Inspectors. Halcomb, of Gray, is the principal of the Knox County Area Technology Center.

KENTUCKY CENTER FOR THE ARTS CORP. n Valerie Washington has been appointed as a member of the Kentucky Center for the Arts Corp. Washington is a pastor at Hughlett Temple AME Zion Church in Louisville.

KENTUCKY COMMUNITY AND TECHNICAL COLLEGE SYSTEM n Barry Martin has been appointed to the Kentucky Community and Technical College System Board of Regents. Martin, of Lexington, is the CEO of Primary Care Centers of Eastern Kentucky.

KENTUCKY COMMUNITY CRISIS RESPONSE BOARD n The following individuals have been appointed to serve on the Kentucky Community Crisis Response Board: Deborah Dawson-Crain, Louisville; Kelly Pompilio, Fort Thomas; Harold Jones II, Winchester; Pamela Fleitz, Mount Washington; John Gosper, Lexington; Donna Woodward, Greenville; Michael Ward, Alexandria; Michael Humble, Russellville; and William Bratcher, Calhoun.

KENTUCKY COUNCIL ON POSTSECONDARY EDUCATION n The Kentucky Council on Postsecondary Education has named 22 Kentucky college students to a new advisory panel that will offer diverse perspectives on student concerns and policies in higher education.

Members include: Ethan Clark Allen, West Kentucky Community and Technical College; Rachel Burns, University of Louisville; Priyadarshini Chandrashekhar, University of Louisville; Cameron Davis French, University of Kentucky; Taylor Hoffman, Eastern Kentucky University; Molly Logsdon, Murray State University; Te’Asia Martin, University of Kentucky; Eyouel Mekonnen, Eastern Kentucky University; Scott Nelson, Western Kentucky University; Aaron Anthony Nethery, Murray State University; Nadia Pacheco, West Kentucky Community and Technical College; Jason Brent Parsons II, Morehead State University; Mallory B. Quisenberry, University of Kentucky; Trevor Daniel Schooley, Somerset Community College; Mahogany M. Shelton, Kentucky State University; Walter Steely, Murray State University; Abigail Nicole Stewart, Jefferson Community and Technical College; Afi Henriette Tagnedji, University of Louisville; Michaela Taylor, University of Kentucky; Clay Wallace, Morehead State University; Gregory Thomas Wieland, Northern Kentucky University; and Noah Young, University of Louisville.

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KENTUCKY ECONOMIC DEVELOPMENT PARTNERSHIP n Scott Lusk has been appointed as a member of the board of the Kentucky Economic Development Partnership Board.

Lusk, of Guston, is vice president of The Lusk Group.

KENTUCKY FILM COMMISSION n Jordan Smith, Gill Holland and Alan Forbes have been named members of the Kentucky Film Commission. Smith, of Murray, is the director of government/ institutional relations at Murray State University. Holland, of Louisville, is a film producer. Forbes, of Paris, is a motion picture production manager.

KENTUCKY FISH AND WILDLIFE COMMISSION n David Jones, Joshua Lillard and Robert Lear have been appointed to the Kentucky Fish and Wildlife Commission. Jones, of Barlow, is the owner of Green Timber Duck Club. Lillard, of Hebron, is a sales representative for Emerge IT Solutions.

Lear, of Versailles, is a real estate agent for Keller Williams Bluegrass Realty.

KENTUCKY HIGHER EDUCATION ASSISTANCE AUTHORITY AND KENTUCKY HIGHER EDUCATION STUDENT LOAN CORP. n John Daugherty, Catheryn Dykstra and Gary Cox have been appointed to the board of directors of the Kentucky Higher Education Assistance Authority and the Kentucky Higher Education Student Loan Corp.

KENTUCKY HORSE RACING COMMISSION n Tom Riddle has been named to the Kentucky Horse Racing Commission.

Riddle is a veterinarian at the Rood and Riddle Equine Hospital in Lexington.

KENTUCKY LAW ENFORCEMENT COUNCIL n Murray Police Chief Jeffrey Liles has been appointed as a member of the Kentucky Law Enforcement Council.

KENTUCKY MEDICAL ASSOCIATION n The Kentucky Medical Association has elected its new officers for the upcoming year: President – Dr. Dale Toney, Lexington; President-Elect – Dr. Neal Moser, Crestview Hills; Vice President – Dr. Michael Kuduk, Winchester; and Secretary-Treasurer – Dr. Jiapeng Huang, Louisville.

KENTUCKY REAL ESTATE COMMISSION n Gus Hauser and Raquel Carter have been appointed to the Kentucky Real Estate Commission. Hauser of London, is the chief operating officer of PT Pros.

lanereport.com

Carter, of Lexington, is the owner of Guide Realty Inc. KENTUCKY STATE POLICE PERSONNEL BOARD n David Snardon has been named to the Kentucky State Police Personnel Board.

Snardon, of Louisville, is a pastor at Joshua Tabernacle Missionary Baptist Church.

KENTUCKY WORKERS’ COMPENSATION FUNDING COMMISSION n Lexington attorney Timothy Feld has been appointed as a member of the Kentucky Workers’ Compensation Funding Commission.

MARION COUNTY INDUSTRIAL FOUNDATION n Dr. David George has joined the board of directors of the Marion County Industrial Foundation. George is president of Family and Internal Medicine in Lebanon and medical Dr. David director for the Village George and Cedars of Lebanon nursing centers.

MOREHEAD STATE UNIVERSITY n Arthur Walker III has been appointed to the Morehead State University Board of Regents. Walker, of Mount Sterling, is president of Walker Construction and Materials LLC, a highway construction and materials company.

NATIONAL ASSOCIATION OF STATE DEPARTMENTS OF AGRICULTURE n Kentucky Agriculture Commissioner Ryan Quarles has been elected president of the National Ryan Quarles Association of State Departments of Agriculture.

NORTHERN KENTUCKY UNIVERSITY n Northern Kentucky University’s board of regents has elected its new officers for the coming year: Chair – Andrá Ward Andrá R. Ward; Vice Chair – Normand G. Desmarais; and Secretary – Gregory Shumate. Serving on the NKU Board of Regents are Michael Baranowski, David Bauer, Rich Boehne, Lauren Goodwin, Ashley Himes, Dennis Repenning, Ken Perry and Lee Scheben.

PETERSON DUMESNIL HOUSE FOUNDATION n Lucy Paez, Alex Linderman and Dr. Andrei Moldoveanu have been appointed to the board of directors of the Peterson Dumesnil House Foundation, a landmark site in Louisville.

Lucy Paez

Alex Linderman

Dr. Andrei Moldoveanu

SARNOFF CARDIOVASCULAR RESEARCH FOUNDATION n Alan Daugherty has been elected to serve as chair of the Scientific Committee of the Sarnoff Cardiovascular Research Foundation, an organization that trains medical students to be Alan leaders in cardiovascular Daugherty science and medicine.

Daugherty is senior associate dean for research at the University of Kentucky College of Medicine.

UNIVERSITY OF KENTUCKY n The following individuals have been appointed as members of the University of Kentucky Board of Trustees: Ron Geoghegan, retired public affairs executive, Louisville; Raymond Daniels, owner of Equity Solutions Group, Lexington; and Robert Vance, Maysville.

UNIVERSITY OF LOUISVILLE n Diane Porter and Alfonso Cornish have been appointed to the University of Louisville Board of Trustees. Porter, of Louisville, is a retired educator. Cornish, also of Louisville, is a consultant for Closing the Gap Consulting.

WESTERN KENTUCKY UNIVERSITY n Jan West and Currie Milliken have been appointed to the We s t e r n Currie Ke n t u c ky Jan Milliken University West Board of Regents. West, of Louisville, is an attorney for Goldberg Simpson LLC. Milliken, of Bowling Green, is the owner of Milliken Law Firm.

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LANE ONE-ON-ONE Greg R. Strahan became president and CEO of Owensboro Health Inc. in August 2016. He joined OH in 2005 and has held the positions of chief operating officer and vice president of business development. Strahan began his career as a staff accountant with a regional accounting firm and later served as controller of a furniture rental company. After moving into the health care field, he managed a durable medical equipment business before becoming vice president of business development for a seven-hospital system. At Owensboro Health, he lead the team that from 2006-2013 designed and built OH’s 477bed hospital, which has received national awards for architectural design, the utilization of lean principles, and the use of natural light and art as part of the healing process. Strahan has been published in Healthcare Financial Management Association magazine and in Hospital Strategies in Managed Care. He has an associate degree from Pearl River Community College in Poplarville, Miss.; a bachelor’s in business from the University of Southern Mississippi; and a master’s in health care administration from the University of Alabama Birmingham. He is active in the Kentucky Health Collaborative, the Kentucky Hospital Association, and the Owensboro Kentucky Project.

Focus on Quality and Safety Produces Patient Revenue at Owensboro Health CEO Greg Strahan says health care workers seem to function better when the pressure is on, as the COVID-19 pandemic has shown again Mark Green: This COVID-19 pandemic that hit in March continues. Kentucky is experiencing a plateau in cases as we speak in late August. What are the main impacts for Owensboro Health, the key health care provider for a 15-county region?

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October 2020

Greg Strahan: The basic delivery of services was altered significantly.

The mandate to not do surgeries was very difficult. You’ve got immediate surgeries, trauma surgeries–what part don’t you do?

The loss of revenue. (There was) an immediate change in our plans and budget and financials. There were escalating expenses of responding— now we’ve got to have PPE (personal protective equipment), ventilators and more of other things, because this is a real issue we have to deal with now.

All the ‘nonessential’ people had to work from home. There is stress; it’s a new dynamic. You’ve got to wash your hands, wear a mask, wear PPE. You don’t know how the virus is going to

be dealt with. Am I going to contract it? How do I protect our staff and our team? There was emotional impact.

The fear in the community was a big issue and still is. People have to go to work, they don’t know who is going to keep their kids or what to do with them; the dynamics of losing revenue, income, families losing jobs, being on furlough. None of our team members were sent home; we paid them all as if they were doing their regular job, we made that decision early. It’s what gave Owensboro the ranking of being the only metropolitan area in the country that had a lower unemployment rate after COVID than it did before COVID. We made a decision early on that this is a market in which hiring a nurse lanereport.com

is not the easiest thing to do and when you do, there’s six weeks of training to get them up to speed. If I furloughed our people, when it was time to come back they wouldn’t be there, either because they had to go find something to do because unemployment wouldn’t have been enough for many people or their spouse may have lost employment. We decided we were going to pay everybody, regardless of what they did. If they didn’t have any patients, they could be repositioned to something else–driving golf carts, greeting people, taking temperatures.

We knew coming back and getting the staff back to speed would be more difficult and more costly. It turned out perfectly because we never lost a step.

There were significant challenges to deal with, but we have a pandemic plan now. We know we can put another hospital in our convention center and house people. We worked with city and state officials to make sure we would be able to take care of this. And with Twin Lakes (Regional Medical Center, a 75-bed facility in Leitchfield that Owensboro Health has a letter of intent to acquire) coming on, we have 18 counties. Because it’s a new facility, we can change every room in this hospital to a negative-pressure room, which can be critical-care reliable.

We trained nurses who aren’t used to being in critical care to be critical care nurses in case we needed them. The creation of all of that was seamless. We put a team together and went after it as a challenge to redevelop ourselves into nothing but a COVID hospital. Then communicating what was happening in our hospital out into the public was seamless.

MG: Was there a most unexpected lesson?

GS: How fast we adapted in our ability to pivot has been remarkable.

I’ve noticed all my career that health care workers just work better under pressure. They’ve learned how to think on their feet, they adapt well, they remember processes. They understand the need to be clear in communication when they’re dealing with a disaster.

Their training kicks in when they have a disaster, and it did in this case.

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An unexpected lesson was the coordination we had with the Daviess County Management Group, the city, the mayor, the judge-executive and the health department. We got together with the school system and talked about what they needed to do to be safe. It worked well.

You’re never prepared for a worldwide pandemic. Supplies were getting harder to get. We had to go to national stockpiles and Washington.

We got what we needed, and we were able to manage.

And there is this simple, unexpected lesson: People need to use common sense. Wash your hands, cover your face and mouth with a mask. Social distance and don’t get in crowds. Whether it’s the

The category we’re seeing for the future—and what I see happening now—is geriatrics.

flu or a common cold or a pandemic or some other virus, those are key elements everybody should learn.

That’s a lesson we will re-establish every time we have flu season or people with pneumonia. Those are key elements to fighting resistant bacteria, viruses and the like that people ought to think about every time.

MG: Is Owensboro Health still the largest employer in the state, west of Louisville?

GS: We say we’re the largest employer west of Louisville and I-65.

If we include Twin Lakes Regional Medical Center, we have about 4,900 team members. We have about 260 employed physicians and about 140 nurse practitioners. At our hospital, we have about 230 doctors on staff and about 180 nurse practitioners.

We have independent physicians who aren’t employed and people who are out in clinics. Out of that

4,900, a good 2,000 to 1,800 would be nurses if you include Twin Lakes.

MG: What priorities did Owensboro Health’s most recent Community Health Needs Assessment find, and how are you addressing those?

GS: The requirement that we do a Community Health Needs Assessment also requires us to have a plan to deal with it. We do have a strategic plan in place for these.

We update them annually and have internal review priority teams focused on those strategic areas that popped up as for us. Health behaviors, for example: poor exercise, poor eating habits, obesity, and related diseases.

Mental health is a big one, and that’s a tough one because we don’t have as many psychiatrists, mental health counselors in our market as we’d like, and we continue to look for those.

There’s not a lot of mental health space either. There’s a bigger need than the number of beds available.

Substance abuse, children and teen issues. Smoking is still a big one. We have a group focused on population health management. We have tobacco-cessation classes, specialists who provide nicotine-replacement therapy and tobacco-free policies.

We’re a part of a collaborative and helped write some of the state laws.

We are a smoke-free facility, smokefree downtown, restaurants are smoke-free, and all federal buildings are (smoke-free). But it’s a tough habit, so we work with people.

Low-dose screening for lung cancers is a big thing we’ve led the charge on early in the state, working with UK and their lung-screening program.

We developed it many years before we got involved with UK. There have been a significant number of people we’ve found with nodules by using low-dose X-rays that allow us to see those nodules early. Many of them would be dead with cancer today if we hadn’t done that. Screening for lung cancer continues to be one of our strategic initiatives because in Kentucky smoking is a big issue.

Part of our strategy is to pay our team members a success year (bonus) for reaching those goals. And October 2020 21

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we set a goal to do better and to find opportunities to improve the health of people we’re serving.

MG: How did the pandemic affect Owensboro Health financially?

Are there any numbers that you can inject, maybe even percentage numbers or anything?

GS: March 12 was our first pandemic case, right before the governor shut down elective surgeries and other things, recognizing that those were the right things to do at the time.

In that period of time, from the cancellation of elective surgeries and non-essential procedures, we had a significant reduction in our revenue: approximately $45 million worth in that month and a half before we got back into bringing those people in.

The increase in our pandemic costs and expenses was about another $20 million more than we budgeted. That totaled about $65 million in either lost revenue or increased expenses.

And then add onto that we kept all of our employees here; we didn’t take away expenses.

MG: Did Owensboro Health implement new disinfection protocols as a result of the pandemic, such as the use of UVC lighting or other strategies?

GS: We evaluated that. The cost of those machines is significant, but they do have a significant impact; many hospitals around the country use them. We’ve always held a high standard on how we clean our rooms.

When I go in to talk to our new hires and they include housekeepers or people who are not the highest-paid here, I make a point of saying the most important people in the room are the housekeepers.

Those people work hard. They are responsible for keeping us from spreading germs and viruses. When they decontaminate a room, they spend a lot of time. Processes are in place so we never have people getting a disease from being in this hospital because of our rooms. That’s been the case for many years, and is part of our expectation. We check it, we watch it, we know when we’ve had people who 22

October 2020

have gotten sick in the hospital and there’s very few of those ever.

We did look at the UV thing, but took other extra precautions, using Clorox wipes and wiping off our elevators. We started having elevator operators to touch the buttons and wipe down the inside after. It was a lot of extra manpower, but when you

You don’t have to worry about money, because money will come with people finding that you have the highest quality, safest care, and you’re doing the best job.

have extra people you didn’t furlough you have an opportunity to put them to work doing things that make a difference in how we treat our patients.

MG: Kentucky health care consolidation driven by network formation has slowed, but Owensboro Health recently acquired Muhlenberg Community Hospital and is about to add Twin Lake Regional Medical Center in Grayson County. What strategy is involved?

GS: We’ve been asked to come to other parts of the state and add a hospital to our system. Some are right, some are not right. Either they don’t have the same culture in being able to take care of people, or there’s (a system) closer they ought to be hooking up with as opposed to us.

Our limit is about an hour away. At that point you’re getting into other people’s territories and unless you’re invited, you don’t want to do that.

Our strategy is if we can get to them within an hour, then we can help them develop services that will meet the needs of their hospital and if they need a tertiary-care referral center, they can send their patients to us. That makes for a good relationship. We don’t ever say you have to send your patients to Owensboro. We always said, send them wherever you think they’ll get the best care. But if you can’t send them to us because you don’t think they’ll get the best care, then let us know because we need to fix our care.

MG: Other hospitals approach you rather than Owensboro Health reaching out to grow and acquire hospitals?

GS: We would never push ourselves on anybody because I don’t think there’s a good relationship when you do that.

Our relationship is built around, ‘How much can we help you?’ When you talk about Jasper, Ind., or Tell City, Ind., or Breckenridge or Ohio counties or even Twin Lakes, during COVID-19 we had all of those folks on the phone talking about how we could help them. It was not, ‘You have to send something to me.’ It was, ‘Do you need something? Do you have PPE?’ The other reason we did this is because we wanted to know what they were experiencing in COVID patients, because if they have them, sooner or later we might end up with them. We wanted to know what the market looked like in terms of how many people were COVID-19 positive, so we could be prepared in the event they needed to send them. And that happened. The nursing home in Grayson County had an outbreak, and it went through several of the staff and residents. They called and lanereport.com

said, ‘Look, we can’t take all these patients.’ I said, ‘Send them to us.’

We had the Green River Correctional Complex. They had no social distancing, no masking, they had no testing going on, and they called us. We did a whole wing that was nothing but prisoners.

MG: Is it likely there will be further acquisitions or enlargement of Owensboro Health in the near future?

GS: There’s going to be continued consolidation of sorts. The criticalaccess hospitals are on a 1% margin; they get 1% more than their cost. It’s cost-based reimbursed, and that’s a hard sell to get 1% more back than you spent, and try to make the necessary changes to make it work.

Things are tougher, and trying to find doctors to go to those hospitals becomes a real problem.

If you want to be a part of a system, we’ll work with you to make that happen. We’ve done affiliation agreements to provide services in hospitals: general surgery, cancer care, urology care. We put physicians out into the marketplace to help hospitals have access to services. That helps them keep going, and I’m happy for that. But when they do need to have that conversation, ‘Can you take us home?’ The answer’s going to be, ‘Absolutely, we’re glad to do it.’

But it’s not something we proactively seek out. We are responsible, as a tertiary-care referral center, to take care of Western Kentucky. We’re the only one in this area now that Henderson and Madisonville have changed. It gives us the opportunity to be that referral center for all these hospitals and let them be what they want to be.

MG: There is a trend for systems such as yours to align with large providers or networks like Mayo Clinic, Cleveland Clinic, MD Anderson or UK Markey Cancer Center. What is Owensboro Health’s strategy?

GS: I’ve been here 15 years, and we’ve had a long history of strategic partnerships. We want to keep

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Kentuckians in Kentucky. It’s better for their insurance, and it’s better for our health care system to take care of our own. We have relationships.

UofL rebuilt our heart services before I got here. They would send us cardiac surgeons, and they put us back on the map. They got a lot of our business if we couldn’t do that work.

We have a relationship with UK Markey Cancer Center, which has a National Cancer Institute designation and all of the testing, all of the trials.

Being part of Markey Cancer Center network allows us to send our patients to those trials should they need them, and participate in their lung cancer screening trials.

We have a UofL nursing program here, a UofL family medicine residency program, and a UK Pharmacy program, where we take fifth-year students and train them to be subspecialists, whether it’s ER or in the critical care unit or on the oncology floor. We’ve been a part of UK Gill Heart Institute.

We’ve talked with Vanderbilt, but people hate to go to Vanderbilt because Nashville is so busy; going to Lexington, going to UofL is easy. People go to Mayo, they go to the Cleveland Clinic, they go to MD Anderson. But most of the people who go to those places usually find that the doctors there say, ‘Look. Y’all have a great medical center there. You got a great cancer center there. They’re doing great work. You can have all your services done there and save you a lot of time and effort, and we’re happy to participate in that from here.’

We have a good relationship with Mayo, have a good relationship with Cleveland Clinic. They would like it to be better, but it is what it is. We feel we need to support other hospitals in our state that are teaching facilities.

We’re a part of the Kentucky Health Collaborative with nine other of the largest health care systems in our state. We meet and talk about things we can do together. We need to be talking about improving quality and safety. That needs to be a primary thing we talk about regularly and do.

MG: Owensboro Health’s 2019 annual report lists 17,000 inpatient admissions, 28,000 surgeries, more than a million outpatient visits.

What are your annual financial results and how does that compare to the industry?

GS: In our last annual report period, which ended in May, we were almost identical to the 2019 admission and surgeries and even the outpatient.

Even with COVID-19, they’re all within a couple hundred.

Our annual revenue—net revenue not gross—was about $681 million.

Our operating income was $22.4 million, and our net income for the fiscal year ’20 was $13.3 million.

The pandemic negatively impacted volumes and financial margins this year for hospitals around the country, as you know. We’ve not been immune to those impacts, but at the end of this fiscal year we were better than last year. Kaufman-Hall came out with a report this week that said hospitals’ operating margins for the first seven October 2020 23

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months of the calendar year are down 28% compared to the same time last year, and our operating income and total net income for the fiscal year is higher than last year. So ours was not affected that way.

If it had not been for us keeping our people here, the chances of us recovering as quick as we did would not have happened. Before COVID-19, we were $10 million ahead of our budget, and we still ended up about $7 million over. We had a little hit, but we were able to recover a big chunk of it just because of those factors.

MG: What revenue areas are growing, which are decreasing, which are the most important?

GS: The category we’re seeing for the future—and what I see happening now—is geriatrics. Our hospital is going to eventually be a geriatric hospital. Things are moving outpatient more and more, so we’re preparing for a geriatric-type facility—taking care of the elderly prior to them going to a long-term care facility. We are hiring geriatricians, and quite frankly it’s because internists are difficult to find as it is. Thank goodness we have the UK (College of Medicine regional campus) in Bowling Green that is going to train for internal medicine, because what we see is a big aging population. We are having success taking care of those folks and understanding their needs. That’s a long-term strategy you have to have.

That’s going to increase as the baby boomers continue to roll out, and then the next generation has a bigger

population than the baby boomers.

Geriatrics has been a big boom for us this year. We’ve just finished our first year, it was very successful, and it continues to be a needed service.

Important areas include surgery, and addressing the obesity issue, particularly when we think about children in school. Maternal/fetal medicine is significant, taking care of our babies and our NICU. Our heart services are growing; we probably have 10 or 12 cardiologists and two cardiothoracic surgeons. We have an electrophysiologist, we have an interventional radiologist. These are new services.

Our neurology stroke care has been enhanced and doing a lot better.

Endoscopic GI (gastrointestinal) procedures are growing. Oddly enough, we’re having a boom year in births; we’ve exceeded the numbers of the last three years. At one time, our pediatric population was almost nothing; we started rebuilding when we built this hospital (in 2013), and it’s come back.

General surgery is big and it continues to grow. Ortho is a large business because of our (area’s) involvement in outdoor activities— soccer, baseball, football. It’s a big sports city. And we have three doctors who all trained in Texas and are phenomenal plastic and reconstructive surgeons. Cleft palettes and all those things have become very important.

MG: What metrics do you look at most closely to assess how things are going?

GS: Quality is what drives revenue.

Twenty-five years ago, when we were doing a budget, we always said you have to have 4% (income) on the bottom line to replenish yourself. And then we realized that if we do better quality work, you don’t have to worry about growth. It’ll find you. You don’t have to worry about money, because money will come with people finding that you have the highest quality, safest care, and you’re doing the best job.

(A key metric is) pushing our four-star hospital to be a five-star.

Our transitional care unit is a fivestar today; our hospital is a fourstar. Muhlenberg’s a five-star for us.

Quality is the big thing that I look at.

I also look at our serious safety events, which is part of our Target Zero program. We communicate with staff that everybody has a right to question what’s happening in our hospital to make sure we’re doing the right thing for the patient and we’re safe when we’re doing it. We make sure we follow those guidelines. They get touted all the time, and have been for years. We started that in about 2012, and it’s been a big win for us.

On The Leapfrog Group (quality and safety survey) we’re almost at an A; we’re hoping to get that A this year. We could be a four-star, five-star hospital and an A rating in Leapfrog. Those are things that we always look at.

Financially, I always look at days cash-on-hand. We had a low number of days cash-on-hand when I started as the CEO, and my objective was to get to 200 days cash-on-hand. At 200 days you can essentially overcome most anything that might happen; you don’t have to worry about collections or developing business.

We’re at about 242. That’s the highest it’s ever been that I can remember.

Part of the reason we (kept all staff on) payroll was I knew we had enough cash to be able to do it and

Owensboro Health President and CEO Greg Strahan, surrounded by volunteers, officiates a ribbon cutting ceremony at a new Maternity Services Gift Shop at Owensboro Health Regional Hospital.

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Owensboro Health President and CEO Greg Strahan addresses the community about COVID-19 and CARES Act funding, alongside Senator Mitch McConnell and local physicians.

not keep us from doing other things that we needed to do. Our rating agency found 86% of the hospitals in the country got a “down” rating in terms of their outlook. They upheld our as “positive” because of what we’ve done on our bond rating.

The patient census is also something I look at: patient satisfaction and market share are key elements.

MG: Has big data collection and analysis had a significant impact on hospital administration and how significant do you expect it to be in the future?

GS: Big data collection is critical. We have a department of four or five people called our Decision Support Group devoted to that. We evaluate our data, look at our cost factors, look at what’s going well for us, where there are opportunities for us to drive costs down by changing processes.

We have a Lean Six Sigma person or two. The metrics are critical.

We spent about two years trying to understand and identify the purest data we can get, that we can give to a doctor and say, ‘This is the data we have on you and your patients, and these are the things that you’ve done in the past 60 days.’ And they look at them and say, “Every one of those are absolutely correct. That’s who I’ve seen, I remember all those cases…”

Doctors have phenomenal memories when it comes to patient data. When you give them something, they will be able to look at that list and go through there and tell you when it’s right or not. We make sure we collect data that is accurate so we can do detailed analysis for them and give them feedback on how they can grow their business, how we grow our market, where our market’s coming from, what people are in the market who haven’t been to the hospital. Do we know where the diabetics are, or the obese people, or the people who

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haven’t had a colonoscopy, or the one who hasn’t had a mammogram?

The sourcing mechanism to be able to find that and get that information, and then give reminders to people is really going to be the key in driving health care in the future.

And it is helpful in terms of improving the population you’re serving. If I can get to them before they have an event, I’m going to preserve the long-term dollars they don’t have to spend on doing cancer treatment, because I’m going to catch them early. The big data is important.

We were the first hospital in America to achieve a Strata Level 7 integration for analyzing operations and service line costs. We bought a Strata program—it’s how you analyze the operations of any business. We implemented that and we got to level 7–the only one Strata had in the world.

We went to New York and picked up a trophy for getting that. All of our data is merged into this Strata platform. We’ve been able to analyze and control our costs, identify where we need to make changes and adjustments. We do that on a monthly basis.

MG: You are about to retire. What advice do you have for your successor?

GS: When you get in the chair, make sure you’ve got a good tight hold on it. It is a big job, but it’s so much fun.

It’s been a real pleasure to be able to do this work. I have been doing this since the early ’80s. You really have to have a calling to do health care, in my opinion. My calling was because I lost my first wife with a glioblastoma, a brain tumor. I was 27 and she was 24 when she died. I remember thinking, ‘Health care can be better than this.’

I wanted to get into health care (to) help make a difference.

The thing I would say to anybody who takes over this role is it’s the best job you’ll ever have. It’s a life-long accomplishment that’s so wonderfully rewarding. Owensboro Health has an outstanding team and a board that’ll support them like nobody else. Great things will be ahead if the next CEO takes what we’ve done and engages with the great team members who are here. Give them good direction, but don’t hover over anybody. You give somebody a job, tell them what they’re accountable for doing, and then you hold them accountable but don’t smother them.

Give them leadership, give them encouragement, give them the tools they need, and then manage it. The way I manage it is by knowing the people. I can go to any one of them and ask a question, and they will get the answer. Then I can build a strategy around that.

As a CEO you have to get out of the way of people doing their jobs. If they can’t do it, you move them on into something they can do. It should never be a vindictive or a harsh thing to say: “I need you to do this type of job. I’m going to need this job to be done by this person here, and I hope you’ll stay with the team.” Building character in people, giving them opportunity to grow and learn and improve, and then telling them how good they’ve done and supporting them is the only way to run a business. I’ve run six or seven different businesses, and I’ve found that to be true every time. ■ Mark Green is editorial director of The Lane Report. He can be reached at mark@lanereport.com.

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ECONOMIC DEVELOPMENT

Located on a scenic bend overlooking the Ohio River, Owensboro is Kentucky’s fourth-largest city.

Owensboro’s Bright Jobs Performance City was only one of 389 U.S. metro areas in positive territory in June

BY MARK GREEN

O

WENSBORO made national headlines in July as the country looked to restabilize from a deep and unexpected recession created by shutdowns to slow COVID-19 coronavirus spread: The Ohio River city’s employment rate was lower in June 2020 than June 2019, the only metro area among 389 in the nation that was on the upside.

Pandemic social distancing measures imposed in March sent what had been a bustling early 2020 U.S. economy into a historic tumble.

GDP plunged the second quarter at a 33% rate, the worst on record, and unemployment shot from a record low 3.5% in February to 14.5% in April, a rate last seen in the Great Depression.

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The federal Bureau of Labor Statistics reported average U.S. unemployment at 11.1% for June, but Owensboro’s joblessness measured 4.2%, down a few tenths of a percentage point from a year earlier, and far, far below national norm.

The Wall Street Journal and National Public Radio, along with area and regional media, reported to their audiences about Owensboro’s feat.

“The small city of Owensboro, Kentucky,” a widely viewed CNN piece said, “has been extremely lucky in this recession. While the rest of America grapples with historically high unemployment, Owensboro’s job market has emerged relatively unscathed.”

CNN cited Owensboro’s heavy presence of essential health care,

personal protective equipment manufacturers and the production of alcoholic and tobacco products that stressed-out Americans wanted more of.

In the business community, though, it is a truism that the harder one works the luckier they get.

Owensboro leaders have spent years diversifying their economy and when the shutdowns began, its largest employer, Owensboro Health, decided its best strategy was to keep all 4,000plus employees during what became a six-week halt to most Kentucky surgery, a major revenue-producer.

“I spoke to Governing magazine about it,” said Greg Strahan, president/CEO of Owensboro Health.

“They asked, ‘How did you do that?’

I said, ‘We made a decision early on that this is a market in which hiring a nurse is not the easiest thing to do.

And even when you do, there’s six weeks of training to get them up to speed for what they’ll need to know lanereport.com

how to do. If I furloughed our people, when it was time to come back many wouldn’t be there. They’d pursue steady income elsewhere because unemployment would be far less than their household budget expected, and perhaps a spouse lost income too. I felt we had to keep them employed.’”

Meanwhile, one of Strahan’s key management practices is to keep strong cash reserves, and Owensboro Health’s financial position made keeping employees an option.

“I always look at days cash-onhand. I built this up,” he said.

Since becoming CEO in 2016 he’d aimed at having 200 days cash-onhand, he said, “because at 200 days you can essentially overcome most anything that might happen; you don’t have to worry about collections or developing business. We’re at about 242.”

Owensboro Health management decided to continue paying everybody regardless of their job function and even if they didn’t have patients.

They were repositioned.

“We had them driving golf carts, greeting people at the door, taking temperatures, and we still do today,” Strahan said. “We knew coming back to work and getting the staff back to speed would be more difficult and more costly. It turned out perfectly because we never lost a step.”

When the ban on general surgery was lifted, their major revenue stream resumed immediately.

“It shows how dedicated our employers are to their employees and getting them back to work,” said Brittaney Johnson, president/CEO of Owensboro Economic Development (OED). “We had several other employers who did the same thing,” she said of Owensboro Health’s choice.

Some of Owensboro’s best-in-thecountry metric can indeed be credited to luck, she said, but other elements played a significant role.

“It’s our community pulling together. That’s what they’re all about,” said Johnson, who came to OED 18 months ago. “It’s the groundwork that’s been laid in the past. It’s economic diversification.

(Employers’) commitment to the community, and to their employees.”

Owensboro’s No. 2 employer is US Bank Home Mortgage, which has 1,200 people serving a hot national market for sales and refinancing alike due to the lowest residential real estate interest rates ever: under 3% for 30-year financing and less than 2.5% for 15-year loans.

Specialty Food Group, a meat processor for major brands, and Toyotetsu Mid-America, a parts supplier to several Japanese vehicle manufacturers, each employ 700 in Owensboro. The UniFirst customized work uniform distribution center has 445. Titan Contracting and Leasing, a metal fabrication and construction operation, employs 400.

Sazerac’s Glenmore Distilleries, which has 425 employees, drew special attention in national news reports. Its operations include bottling the world’s top-selling liqueur, Fireball Cinnamon Whiskey, thought to have become even more popular since shutdowns sent Americans home from the workplace.

Paper products producer Kimberly-

Clark’s 400-employee operation sped up when the pandemic hit because it makes toilet paper, which became a target of panic buying and whose supermarket shelf space still remains only half full.

The 382 employees of Mizkan America in Owensboro produce Ragu spaghetti sauce, another product that has seen increased demand during the pandemic because with more people eating at home, it is an easy, satisfying comfort food. In fact, Mizkan is now expanding its Owensboro operations, Johnson said, and hiring another 30 workers.

“We are a very diverse community,” she said. “Our top 20 employers represent nine different market sectors,” and this helped Owensboro rebound rapidly when business was allowed to reopen.

Johnson credits Owensboro’s long, steady hard work and community spirit for the good numbers rather than any recent win by local economic development operations – and welcomes the national, regional and local news coverage.

“It helps put us on the map even more,” she said. ■ Mark Green is editorial director of The Lane Report. He can be reached at mark@lanereport.com.

Owensboro is home to a diverse range of employers, many of which have seen demand for their products increase as a result of the coronavirus pandemic.

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WORKFORCE DEVELOPMENT

Filling the Demand for Data Tech Workers Upskilling is the hot word in Louisville for those looking for better jobs

BY DAWN YANKEELOV

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HERE’S a renewed sense of purpose for those in the Louisville area looking for their next rung on the career ladder this year, and it’s because of upskilling for the data economy. In spite of the COVID-19 pandemic, injecting tech talent into the economy via upskilling is trending in Kentucky’s largest metro, which has styled itself as “Possibility City.”

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For those who are unemployed, underemployed, mid-career, changing careers or just beginning careers, Louisville leaders are urging newly available tech coursework through a pair of special partnerships that can advance their work life.

“The purpose is to build our city’s data economy and industry interest in revolutionizing businesses, particularly in the areas of artificial intelligence, internet of things and data science,” said Alisia McClain,

director of community and education initiatives at Microsoft Future of Work Initiative.

The initiative (futurelou.com) is a special alliance formed in 2019 between Microsoft and Louisville Metro Government with the goal of moving the needle on Louisville’s digital economy and making the region a center for excellence in the area of hi-tech work skills. The alliance is also expected to increase economic opportunity and equity.

Earlier this year, in collaboration with community partners at Humana, General Assembly, Louisville Forward, Louisville Healthcare CEO Council, the University of Louisville and Microsoft, the alliance launched lanereport.com

Sharon Kerrick is the executive director of the Center for Digital Transformation at the University of Louisville.

an effort called the COVID-19 Upskilling Initiative. It provides access to free training to gain certifications and badges through Microsoft, General Assembly, IBM and others for participants who learn new technology skills.

The effort builds on the area’s Artificial Intelligence Hub, which was formed in 2019.

“We expect Louisville to take big leaps in the next five years in being able to offer companies qualified tech candidates,” McClain said. “This is really a partnership with education and industry, going beyond the traditional offerings of a four-year degree or

MBA. This push is on for short-term upskilling in self-taught coursework.”

Demand from area industry leaders calls for more upskilling, with an ongoing focus on diversity and inclusion, she said. The abovementioned Louisville partners have set a goal of training 300 people in data science careers by 2023. This may mean microcredentialing, boot camps, IT apprenticeships and internships, 10- to 12-week credentialing coursework and more.

Some free coursework is available; others involve paid training.

Through the upskilling initiative, Ivette Lindsay, a 48-year-old Atlanta transplant to Louisville, won a laptop and was able to jump into a Google Analytics course and finish an initial step in upskilling earlier this year.

She was also enrolled in General Assembly’s 10-week course tied to the Future of Work Initiative, which features lessons in Tableau, SQL and Excel skills. That coursework, she said, includes problem solving, along with lecture and group participation.

Unfortunately, due to some family care-giving her father needed, she has not yet completed the course, but she is re-entering the next session at the end of September.

“I would like an entry-level position within the field of data analysis, working in the area of business, politics or economic development,” said Lindsay, who wants to grow and expand in those career pathways.

“There are those ready to learn more,” McClain said, “and we expect to see more non-traditional

institutions, like AMPED, partner with industry to create even more educational programs.”

Tech Louisville, a program of KentuckianaWorks (the area’s workforce development board), has teamed up with AMPED Louisville (ampedlouisville.org/tech/) to promote tech education. It provides no-cost classes for IT support professionals, leading to a Google IT Support Professional Certificate.

Priority admission will be extended to residents who live in Louisville area zip codes: 40202, 40203, 40208, 40209, 40210, 40211, 40212, 40215 and 40216.

Employers like insurance giant Humana have partnered with Microsoft’s Future of Work Initiative to encourage life-long learning for the area’s talent pipeline, both within the company and within the community.

“We have a need internally to transform Humana, building more data analytics skillsets. The privatepublic partnership of Louisville’s Future of Work Initiative has framed that up. Many people are working in their homes due to COVID-19, and we look to upskilling and reskilling our workforce,” said Roger Cude, senior vice president of human resources at Humana.

Humana has approximately 12,500 personnel in the Louisville market, and remains a key employer in the city. In 2019, Humana and Microsoft announced a seven-year strategic partnership to use cloud and AI tech for predictive solutions and intelligent automation to assist Humana members and internal teams.

The University of Louisville has teamed with IBM to create the IBM Skills Academy, which focuses on digital learning and technology skills.

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WORKFORCE DEVELOPMENT

The Humana Foundation, Interapt and UofL are partnering to bring a paid, immersive training program that teaches high-demand IT skills to the underemployed and unemployed under the title of Louisville Skills.

Interapt, among other employers, has committed to hire several from this next class. (Read more about Interapt on page 66.)

Another program, bit502 (bit502. com/), puts an emphasis on microcredentials, extended online coursework and boot camps. Part of KentuckianaWorks, bit502 is an apprentice-style program where students study computer and information technologies while working and learning on the job.

Classes are offered in Java, Python, HTML, CSS, Security, networking and databases.

To further forward IT apprenticeships, the U.S. Department of Labor funded the University of Louisville with $4 million in February 2020 for its Modern Apprenticeship Pathways to Success (MAPS) program. UofL was one of only 28 such public-private partnerships funded in the most recent round and the only one in Kentucky. The university’s partners include Webster University, Jefferson Community and Technical College and Elizabethtown Community and Technical College.

MAPS looks to target underrepresented minority students and those who are either in military service or linked to the military. UofL graduate and U.S. Senate Majority

Leader Mitch McConnell announced the competitive $4 million grant.

Another initiative targets minority upskilling in the Russell neighborhood of West Louisville.

The Center for Digital Transformation at UofL, in partnership with the Louisville Central Community Center, is working this fall on an economic mobility effort.

More than 200 people are being recruited to participate in free data analytics, artificial intelligence and cybersecurity classes every Tuesday and Thursday. Sharon A. Kerrick, executive director of the Center for Digital Transformation, is the facilitator. For nearly 20 years, Kerrick owned a tech company that expanded over five states and staffed over 300 people. The company aided more than 11,000 students with annual technology training.

The Center for Digital Transformation itself is a new UofL asset, opening in 2019 in the Miller IT Building to help students, faculty,

Jacky Wright, chief digital officer for Microsoft US, is pictured here with Louisville Mayor Greg Fischer discussing an initiative between Microsoft and Louisville Metro Government. The Louisville Future of Work Initiative, announced in 2019, was launched with the goal of making Louisville a regional hub for artificial intelligence, the Internet of Things and data science.

staff and community members develop technology skills.

The Center for Digital Transformation also includes another partnership between UofL and a private corporation, the IBM Skills Academy. This partnership gives university faculty access to the newest curriculum, software and industry experts to further the aim of training students and the community on AI, blockchain, cybersecurity, data science and quantum computing.

Other organizations in the region have also put an emphasis on tech training for Louisville. For example, the Technology Association of Louisville Kentucky (TALK), the area’s employer-led nonprofit tech council, recently completed its first six-week cybersecurity training for 23 small business companies in partnership with the national CyberReadiness Institute, which offers self-guided curricula. ■ Dawn Yankeelov is president of marketing and PR firm Aspectx and executive director of TALK.

Learning new technology skills can open up a whole new world of career opportunities.

30

October 2020

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MANAGEMENT

Investing in Opportunity Jonathan Blue, Chairman and Managing Director, Blue Equity LLC

Blue Equity Chairman Jonathan Blue shares his company’s strategy for creating success

J

ONATHAN Blue is the chairman and managing director of Blue Equity LLC, a Louisville-based private equity firm that has a diverse, global portfolio. Blue Equity’s current holdings range from distribution, oil and gas, and defense to media, talent representation, celebrity chefs, and wine and spirits distillation and retailing.

Blue, who founded the firm in 2004, is in frequent demand as a public speaker and has served on numerous professional panels, offering his experience and expertise as it relates to private equity, sports and entertainment, family-owned companies and other business topics.

He recently sat down The Lane Report Publisher Kevin Stinnett to talk about what has made his company successful and share his thoughts on Kentucky’s current business environment.

Kevin Stinnett: What are Blue Equity’s current investment interests and focus, and why?

Jonathan Blue: We have done many things over the years and had many holdings. We are now in several large focused industries and distribution: retail liquor, wine, beer, and spirits.

We also have a talent business that represents talent.

KS: Do you have an individual manager for each of those sectors?

JB: There is a president for each division. At Liquor Barn, Blue Equity oversees all of those operations extensively. The other businesses each have a president that handles day-to -day operations. We are heavily involved, and we get very involved in investments in which we participate.

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October 2020

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KS: On your website, you have yourself and four others. Do they also have a majority stake in the businesses that you invest in and acquire?

JB: Yes, Blue Equity does, but again, those four or five people on the website are part of Blue Equity; if you add up the entire employee base for all the portfolio companies, we are pushing about 900 people.

KS: Are all of the businesses in Kentucky or this general region?

JB: Most of the businesses are based in Kentucky, yes. The talent business is based in Beverly Hills, Calif., because of the nature of that business. The distribution of the liquor business is in the Kentuckiana region.

KS: Shifting gears a little bit, you also have many businesses in live sports or centered around live sports, which has seen a considerable increase in value, especially from the broadcast marketing platforms. Why invest in live sports? Also, what are your thoughts on Louisville acquiring an NBA team?

JB: We had one business that we sold back in 2010 that represented talent, so we had a five-year non-compete. Once that non-compete expired, we got back into the business. It is not live sports; it’s representing talent that you see on television. So, it’s celebrity chefs; that business is based in Manhattan but run out of Kentucky. We have a company that represents broadcasters on the news, one of the most prominent firms in the industry. We have a firm that represents sports broadcasters–Fox Sports, ESPN, etc. We have a couple of sports agency interests, although those are much smaller. The focus now is representing talent that’s on television, and we serve as their managers and/ or agents depending on the business.

To answer your second question, we would do anything to support the NBA coming to Louisville. I think it is going to be an uphill battle now with COVID obviously being an issue as far as attendance and revenue being off for the league. There are going to be many people that have to overcome

lanereport.com

some struggles, but anything it takes to be supportive of our contacts and our relationships, we are happy to help.

KS: In your portfolio, most everything centers on entertainment and hospitality but then you have Gilford Johnson Flooring. How did you make the decision to invest in that, and how is that going?

JB: That was a company based in the Kentuckiana area, and we invested in that in a control position around six or seven years ago. We then bought a company out of Atlanta and added (another) company out of Miami. So, we have made three acquisitions in that sector. That company is based in Jeffersonville, Ind. It fits with the theme of distribution and investing in regionally owned businesses, helping them grow in size once we invest.

KS: What type of flooring does the company handle? Do they produce it or sell it or both?

JB: Just distribution. Vinyl, LVP (luxury vinyl plank), hardwood, tile, laminate, etc.

KS: How long do you typically try to keep investments in your portfolio? Is there a start or end point established at the beginning once you start the investment, and do you have a dedicated end date to sell? How does that work?

JB: We have pivoted on that. We have never taken a company to market unless asked to by our co-investors or by someone who has wanted to buy the business. We have pivoted on that lately with COVID in that good companies are hard to find, so we are holding businesses much longer if we don’t have an absolute mandate to sell. If it is going to be a great business over the next 25-30 years, we are going to keep it.

KS: How do you solicit co-investors?

JB: We have a very selective goto group that we have a history with over the course of several investments. We have had people join up with us on new things. We have also had investors that come in for the first time on deals because they either like us or they have an intrigue with a sector. It is just situational.

KS: Do you ever have any vision of going public with any of your investments?

JB: We would; they need to be a lot larger today. We would love to have a much larger footprint in the retail side, the wine, beer and spirits. We love the Liquor Barn brand, people know it nationally, but it would have to be a lot bigger to do so.

KS: Are there any sectors that are poised to explode in the next 1015 years that are underperforming now?

JB: The easy answer is bourbon, obviously. Kentucky needs to focus on its signature industries, be it spirits and bourbon (or) be it logistics, which is why we are excited about the distribution business. I think we need to be a hub for the things we are good at and not try to do something we are not. (We should) exploit our natural resources as well as our location on the map of the United States.

KS: Talk a little bit about Blue Equity’s interest in Louisville’s commercial real estate market over the past 10 or 15 years. Are you still invested heavily in that?

How do you see the real estate market today in Louisville?

JB: We de-emphasized that part of the portfolio. We are better off, in our opinion, investing in operating businesses. So that is not as much of a focus as it was in the past. I am discouraged about what’s happening in downtown Louisville overall, especially with the office market.

Louisville has always had challenges catching up to its peer group cities like Indianapolis, Nashville and Cincinnati. We were just getting ready to get over the cuts before COVID hit.

October 2020 33

MANAGEMENT

COVID, coupled with a lot of these challenges we have had downtown, have not helped. Just this week, we had two massive businesses exit from downtown, literally in the last seven days. It will be tough to replace those and others.

KS: What do you think is going to happen to the commercial real estate market as it relates to COVID-19? Moving forward, as people are working from home more, do you think businesses will adapt and downsize their actual footprints in the commercial office space? Do you think it will have a lasting impact on what we have seen in the past six months?

JB: I think we will see a complete mind shift in people working away from the office, how they work, the hours they work. It is exciting because, in some ways, people can be more effective. I start my day very early in the morning, and once I get on Zoom calls and other things, it seems like it is 7:00 before you know it. I try to have a family dinner if I am not traveling and doing other things, then we are right back on for late-night stuff with international and other aspects. To answer your question, we are going to learn to work in a completely different way. I think another thing that didn’t exist before is technology. You can video from your phone, and you can sign documents from your phone now, which you were never able to do before. You can see a person on the other side of the world and hear them correctly and clearly for as long and as inexpensively as possible. Broadband has changed things; the technology has finally caught up with the need, essentially. It is almost like you are sitting in the same room with people even though they are halfway around the world or on a different coast.

KS: Do you think it is vital for entrepreneurs, such as yourself and others, to have formal, advanced business education such as an MBA? JB: I think the more education, the better. I believe that you will start to 34

October 2020

see more people enroll in that type of program now that the job market is suppressed due to COVID. I think it is all positive. The more training, the better. However, there is nothing that beats hands-on; that’s No. 1. People still have to go through experiential things to know how to react in certain situations, and an MBA does not always give you that.

Food Network chef and cook book author Anne Burrell is a client with Napoli Management Group, a talent representation firm owned by Louisville-based Blue Equity.

KS: Do you actively participate in public policy discussions throughout the state or local politics or seek to provide input in some of the policy decisions being made by our leaders?

JB: If asked, I will. I have a lot of close friends in the Kentucky legislature.

We don’t always agree, but they are lifelong friends, and that is what they do. They are there to do their job. I don’t overreach unless asked. I let the process play out.

KS: Are there tax policy changes you would suggest to your friends in the legislature here in Kentucky that would attract more development and make it easier for businesses to do business

or invest in the growth of new businesses?

JB: We are a very highly taxed state.

It is always easier to say lower taxes, but I know we are a very underresourced state. You can’t just say that and then not have the resources to survive as a state. It’s an enormous challenge. In the liquor business, we have the highest taxes in the nation.

We have an 11% wholesale surcharge tax, which has never made sense to me. The fact that we are higher than any state in the United States, and yet we try to be the leaders in liquor is something that really ought to be looked at and really ought to be changed if we want to be competitive around the country.

KS: What about the local sales tax option? Do you think cites like Louisville and Lexington should have the ability to do a local option sales tax on some of the significant capital investments in the communities?

JB: I do. I think the message sometimes is more important than the cause, and I think the message has been very confusing to most of the public. I think the messaging is where those things have failed, but the answer is yes.

KS: Anything else you think folks should know about Blue Equity?

JB: If there is anything out there that is a profitable family business or otherwise makes money and has revenue of a pretty good size, we are very interested in it having a home in Kentucky, for us to buy before it gets sold to someone out of state.

That’s our mantra: We want to make sure we see every deal and have the opportunity to either buy or fund any business in our region that we would invest in before it is sold to somebody else out of the state. We want to make sure we don’t miss those phone calls from investment bankers if someone has an investment bank, that we have a shot of at least partnering with a former owner or an ongoing owner that wants to sell control before something happens with someone outside of the state of Kentucky. ■ lanereport.com

COVER STORY

Construction Stays Busy, but Virus Still a Gamble Louisville Paving contractors perform site work earlier this year for what will be an open-air shopping center in Jefferson County.

Louisville Paving photo

Backlog and growing logistics demand has kept contractors on job; pandemic is restricting the pipeline

BY GREG PAETH

A

S their trucks rumble toward winter and the end of a year that won’t be forgotten soon, wary construction contractors throughout the state generally agree they have more work now than they expect but no reliable assurance that it will continue.

Construction executives say the industry has remained surprisingly busy for much of the year at a time when millions of U.S. businesses either drowned in debt or struggled to stay afloat because of the COVID-19 pandemic.

But contractors also agree there are no certainties about continued 36

October 2020

success in 2021 because the pandemic could yet slice and dice every U.S. business that doesn’t manufacture face masks or hand sanitizer. Several also cite the November presidential election as a critical event that could have a resounding impact on the economy and their businesses in 2021 and beyond.

Louisville Paving and Construction CEO John Dougherty said although his company traces its roots to 1919 and he’s no stranger to how the economy and politics work, he’s been baffled by a confluence of events that didn’t seem to have logical conclusions.

“For me, it (the construction business) is kind of like the stock

market. I’m not quite sure why it’s doing as well as it is considering overall national unemployment, the national economy … and the pandemic in general,” said Dougherty, who oversees about 525 employees and annual revenues usually around $200 million.

“There were enough jobs in the pipeline that it sustained us even with the drop-off in state (highway) work.

We were fortunate enough to have a fairly good backlog coming into 2020, so it will be a decent year for us, although next year is a different matter,” he said. “We’re having a little bit of trouble building backlog for next year. That’s a priority right now. That scares me, and the status of the public work next year scares me.”

Louisville Paving and Construction has prospered over the years, Dougherty said, because its business was balanced between public jobs like streetscapes for City Center in downtown Lexington and rebuilding three miles of I-65 for $29 million, and private contracts such as $12 million in site work and utility installation for open-air shopping centers Middletown Commons and Jefferson Commons in Louisville.

Less road funding, more logistics Dougherty emphasized that his observations reflect what he sees in and around the Louisville region.

He knows other contractors more dependent on state road contracts have been walloped by spending cuts. lanereport.com

Budget cuts due to lower gas tax revenue and the pandemic are strangling spending, said M. Chad LaRue, executive director of the Kentucky Association of Highway Contractors, a trade group headquartered in Frankfort, where it represents road builders’ interests. Through August, the state spent far less on road contracts this year than any year since 2015.

The state budgeted $253 million for 121 projects this year, dramatically less than the $802 million spent last year, LaRue said. However, 2019 was a high-side “anomaly” for several reasons, he said, including that there was a governor seeking re-election, something that historically brings a spike in contracts.

“I think those (contractors) who came into the year with a book of business for six months to a year coming out of 2019 have fared OK, but those who came into the year without a lot booked are really hurting. I won’t tell you there’s a lot of optimism about what’s going to be happening in the next one to two years,” said LaRue, adding that he has heard that a number of

Bristol Group photo

Bristol Group in Lexington has experienced an increase in demand for warehouse and distribution center projects since the COVID-19 pandemic struck last spring because of growth in ecommerce that relies on logistics operations rather than retail stores.

companies have been forced to lay off some employees.

Like Dougherty, J. Todd Ball, president of Bristol Group in Lexington, said construction companies were fortunate Gov. Andy Beshear categorized them as an “essential industry” that could continue during the pandemic.

“We’re doing pretty well. Our backlog was really strong right when the pandemic hit,” Ball said, “so we continued to work. We also have a manufacturing operation that makes precast concrete wall panels that are used for (building) distribution centers.”

Ball’s company has built distribution centers and warehouses for major e-commerce players such as Amazon and Walmart.

“The warehouse and distribution

market seems to be totally unaffected by the economy as it relates to the pandemic,” he said. “It seems like that market is accelerating. We feel very fortunate to have work in that category.”

The explosive growth of online ordering since the pandemic’s arrival fueled a demand for the warehouses and distribution logistics facilities Ball’s company builds with Bristol Precast concrete wall panels. The precast subsidiary expects to continue to manufacture steadily for the foreseeable future at its location just north of Louisville in Charlestown, Ind. Perhaps some 4Q slowdown Bristol opened the year with a substantial backlog, the term contractors use to identify projects they have in hand and Ball said he expects the demand for logistics building to continue for another year or so.

“The first part of the year the phone was ringing quite a bit with other stuff coming in,” he said, “and it was just like, ‘Wow, this is going to be a fantastic year!’ But a lot of our work is automotive-related, and the makers and suppliers of automotive have pulled back, so we’re not seeing a flow of new projects like we were in January and February.”

Budget cuts due to lower gas tax revenue have had a detrimental effect on road construction.

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October 2020 37

COVER STORY

Miranda Construction of Louisville is performing a $7.2 million overhaul of Louisville Slugger Field on the east side of downtown to improve fan amenities. It is home of the Class AAA Louisville Bats minor league team.

“The (financial) hit (from the pandemic) won’t come until the fourth quarter … when we will be looking a little harder for work. Right now, we’re fine,” Ball said.

Bristol’s projects include the Marriott Hotel and the Marriott Residence Inn, two key components of the $200 million Center City project that opened early this year in downtown Lexington, and a 500,000-s.f. county detention center in Indianapolis.

Although acknowledging that the flow of new projects has slowed, Ball is optimistic about 2021, barring any “calamity related to the pandemic or some other kind of calamity.”

Paul Hemmer Jr., CEO of Fort Mitchell-based Paul Hemmer Co. since 1982, said 2021 may wind up looking a lot like 2020 was projected to look.

“We went into 2020—we did our budgeting and forecasting in the fall of ’19—projecting a very robust year, and it looks like that’s just being pushed into 2021,” Hemmer said.

“We have a lot of confidence in our markets that 2021 will be strong, The company will celebrate its 100th anniversary next year.

Not canceled but delayed “In February and March our customers became a little skittish, and we had one project they tabled 38

October 2020

for 12 months,” Hemmer said. “Most of them said, ‘Let’s wait and see and kind of evaluate it.’ And as a result—overall—it’s going to have an impact of four to six months on our revenue. No projects were canceled, but decisions were delayed.”

Six projects that were put on hold are valued at more than $50 million to the company.

“Revenues will be off 40% versus our projections, but … we’ll be operating profitably,” Hemmer said, and he was able to avoid layoffs and keep employees busy.

Hemmer wo r ks with subcontractors for its projects and doesn’t have construction crews.

The construction company has about 35 employees and an equal number work for a facilities group that manages and maintains properties, said Hemmer, whose company has averaged about $75 million in annual revenue the past five years.

Louisville-based Miranda Construction is “blessed to be steadily busy right now with very broad types of projects ranging from sports facilities, office remodels, food service, gas station remodels, etc.,” said Chief Operating Officer Ricky Browning. “It has really been a mix of backlog projects moving forward with construction as well as new and repeat clients.”

COVID-related restrictions are making developers shy for now about moving forward with food service and restaurant projects, Browning said. Positively, office remodel work has remained pretty strong even as work-at-home practices increase,

and education and medical projects continue to go forward.

Miranda is doing a $20 million, five-floor office build-out for Baird’s financial management office in downtown Louisville as well as a Louisville Slugger Stadium remodel.

It is giving him rising hope for 2021 even though changing safety guidelines are a complication.

“My expectations for when the pandemic ends is the construction industry is going to be extremely busy playing catch-up with all the planned 2020 builds and remodels,” Browning said, “but I do think it’s going to be

A project at Cardinal Stadium adjoining the University of Louisville campus is one of more than 200 jobs Miranda Construction has won since it went into business in 2016.

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MORE THAN WHAT'S ON THE SURFACE

Connecting People To Their Lives

(800) 273-1433 loupaving.com

COVER STORY

a long time before the old-fashioned handshake is back around.”

Lower backlogs affect confidence Construction industry trade associations that track the national and state levels offered assessments in September that support Kentucky contractors’ comments.

“We were thankful that construction was an essential service so we could continue work on job sites. … our industry has been thriving because of that,” said J.R. Gaylor, president/CEO of Associated Builders and Contractors of Indiana and Kentucky. “Both years (2019 and 2020) have been great. Our contractors have been very, very busy so these are very strong years for our members and the industry.

The economy’s been great.”

Representing commercial and industrial builders, ABC’s two-state chapter has about 800 members, including 350 in Kentucky. Those 350 contractors and suppliers employ about 75,000 workers in the state, where the association has offices in Louisville, Lexington and Bowling Green, Gaylor said.

The impact of the pandemic in the near future is difficult to determine, he said.

“It’s really hard to tell. We’re very hopeful that it (sector’s relative strength) will maintain, assuming that there aren’t a lot of (COVID) hotspots that break out everywhere and that The $200 million Central Bank Center project in downtown Lexington, including a major exterior revamp of Rupp Arena, topped out this summer.

The job will not be finished until 2022.

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October 2020

construction is still designated as essential,” Gaylor said.

But things do appear to be slowing.

“We’re starting to see a little slowdown in backlog. For example, in the past year or two, contractors had committed to backlog work that is eight or nine months out,” Gaylor said. “Now we’re hearing the backlog may be five or six months versus eight or nine, so that’s probably the biggest indicator of what things might look like on the other side (of the pandemic).”

Richard Vincent, executive vice president of the Associated General Contractors of Kentucky, was somewhat less optimistic about what will happen once backlogs shrink.

“I would say that our contractors continue to work off their backlogs, but in many cases confidence in future profitable opportunities is waning. We’re being told that a lot of our folks are remaining busy right now. However, what the future holds is certainly in question,” said Vincent.

AGC-Ky is based in Frankfort and has a membership of 700.

The convergence of the pandemic, the upcoming presidential election and the state’s vastly underfunded public pension system—a state budget issue that has “already bubbled to the surface”—have created a cloud of uncertainty for the near future, Vincent said.

“Pensions are already affecting the state’s ability and a lot of local governments’ ability to

invest in capital construction and infrastructure,” said Vincent, adding that the state has cut back on road work this year.

Vincent, Louisville Paving’s Dougherty and G. Michael Murphy, who is CEO of Scott, Murphy & Daniel in Bowling Green and Hartz Contracting in Owensboro, all commented about state spending cuts.

“Our bridge and highway division has seen a substantial reduction in work in 2020, but it’s nothing to do with the pandemic—just with the change in the state administration, state funding and the needs of the highway system versus all the other needs of the state. We were very fortunate to have a 12- to 18-month backlog of work in this area,” Murphy said.

“The pandemic has not had a serious economic impact. We have not had any contracts canceled or delayed. There have been some owners who have slowed their process of proposed construction due to the pandemic’s effects on their workforce and production,” he said.

Although he dismissed the notion that his company might face a “serious economic impact,” Murphy did say revenues may be down this year by 20%.

National view more pessimistic While Vincent’s comments about the underfunded pension system reference a well-established quagmire, his overall remarks reflect national data released in September

by AGC, which is headquartered near Washington, D.C. AGC’s most recent national survey “found growing pessimism among contractors amid rising project cancellations. Of the 2,005 respondents from AGC member firms, 38% expect it will take more than six months for their firm’s volume of business to return to its normal level relative to a year ago. … A likely reason for the gloomier view is that 60% of respondents report a scheduled project has been postponed or canceled, up from 32% in June.”

Shawn Woosley, chief financial officer of Louisville-based Wehr Constructors, was among the lanereport.com

Denham Blythe Construction of Lexington is a 44-year-old design-build project specialist.

It was averaging about 400 projects annually coming into 2020.

lanereport.com

Denham Blythe photo

Kentucky contractors who said the current year should be profitable even though results won’t meet earlier projections.

“It’s just kind of a whole new world now. We will do OK. I think we will end up being profitable this year,” said Woosley, whose company has offices in Lexington, Bowling Green and Tampa.

“If it wasn’t for the pandemic, things were shaping up for us to do very, very well this year,” he said.

“There was a lot of work. We had a lot of backlog. There was a lot of stuff on the horizon that people were talking about. And then everything (with the pandemic) hit. We had had a great 2019, and it was shaping up for a great 2020 and 2021 and then everything happened.”

Projects in Florida where the company does a lot in health care were hit hardest, while jobs in Kentucky fared better.

“Up here, for the most part, we really haven’t had anything shut down,” Woosley said. “We had a couple of jobs delayed. They (some clients) just really don’t want to start a new, big project in the middle of a pandemic, but a lot of work already underway hasn’t been affected.

There’s definitely some fear and trepidation just not knowing when everything is going to pick back up. A lot of industry publications are talking about things not really looking great for construction for the first and second quarter of 2021.”

Wehr, with a 75-year history, has about 140 employees, including 120 in Kentucky, and annual revenues of about $120 million, Woosley said. The employee roster includes tradespeople as well the office staff and project managers.

Building the iconic Humana headquarters skyscraper in downtown Louisville put Wehr on the map, Woosley said. More recent

projects include the 21c Museum Hotel in downtown Lexington and Actors Theater of Louisville.

Early 2020 looked like a record year Like several other contractors who were interviewed, Linden Long, who owns Lexington’s Long Construction Management, said the pandemic created major problems for his company.

“2020 started out looking like it would be one of the best years ever. Now it is looking like we will be lucky to break even,” Long said.

“We’ve seen a lot of projects put on hold/delayed and had one canceled all together.”

In recent years Long’s small nineperson company has built hangars at Lexington’s Blue Grass Airport, a 70,000-s.f. expansion of a Fisher Automotive Parts warehouse in Walton, and renovated the Wastequip building in Mount Sterling.

On the other hand, Cincinnatibased Messer Construction, with offices in nine cities including Louisville and Lexington, reported few pandemic-related problems.

“In our experience over the past six months, projects in progress are running with no major delays or cancellations. Speed-to-market remains a priority for project owners, and Messer is poised to finish the year strong,” said Mark Hill, vice president in the Lexington office and a spokesman for both Messer offices in the state.

“Some projects in the planning stages will certainly slide into future months or years due to the uncertainty that continues to surround the pandemic and when/ how it will end.”

“Overall, the pandemic is most notably impacting the pipeline of opportunities in the hospitality, higher education, commercial office building, aviation and senior living sectors,” said Hill, whose company has 225 employees in Louisville and 95 in Lexington.

In Lexington, Messer is leading the $300 million Central Bank Center expansion and Rupp Arena renovation, which topped out Sept.

10 when the final steel beam was positioned above the convention center space. Messer’s revenues topped $1.1 billion in 2018.

Jeff Doss, director of business development for ABEL Construction, said the current year looks good for the company, which has headquarters in Louisville and offices in Lexington and Indianapolis. The company’s client list includes Amazon, Ford, GM, Jim Beam, Makers Mark and FedEx. ABEL has seen continued growth in its work for distilleries and automakers and believes the health care sector will heat up in the near future, he said.

“As for expectations in the future (post-pandemic), it’ll be a gradual build up as supply chains get reestablished and consumers start getting comfortable again,” said Doss, whose company has about 180 people on the payroll.

“From ABEL’s perspective, we’ve been very fortunate with continued work and keeping our staff working,” said Doss. “Does that mean it will continue to remain strong? Depends on the election and some on the vaccine production to ease fears.” ■ Greg Paeth is a correspondent for The Lane Report. He can be reached at editorial@lanereport.com.

October 2020 41

MANUFACTURING

Ford photo

Ford, which operates two assembly plants in Louisville, implemented a global safety plan for all employees and vehicle production is now back to normal levels following a two-month shutdown in the spring.

Assembly Plants Chase Sales Demand Auto dealers kept transactions rolling online during manufacturers’ spring shutdown

BY SHANNON CLINTON

C

ARL Swope said the COVID-19 pandemic has had an impact on the automotive sales industry that he and likely past generations never experienced.

Working in his family’s auto dealerships since 1979, he’s now president/CEO of Swope Family of Dealerships’ seven Elizabethtown and Radcliff locations and is chairman of the Kentucky Automobile Dealers Association (KADA).

42

October 2020

Swope dealerships offer new Chrysler, Dodge, Ford, Genesis, Hyundai, Jeep, Mitsubishi, Nissan, Ram and Toyota vehicles, as well as a variety of pre-owned models.

“I don’t think there has been anything like this, certainly in my career and possibly in of our family in the

Carl Swope, President and CEO, Swope Family of Dealerships

the history automobile

business, and that dates back to 1952, before I was born,” he said.

Swope was involved with state government officials on a plan to reopen car dealerships safely. And one thing that became clear early on, he said, was “We really can do what we do socially distanced.”

That point was proven in early May with “absolutely phenomenal” sales upon reopening, he said. As some lots still look sparse today, people may assume times are tough and dealerships are teetering on lanereport.com

the edge of disaster, when actually they’re selling vehicles as quickly as they’re received, Swope said.

While there’s no way for the industry to recover all production this year, “At this point you sell one and one comes in, you sell one and one comes in,” he said. “So we’re doing OK, but we don’t have cars parked everywhere like you normally do.”

Cox Automotive reported national vehicle sales for August were 19% below those of August 2019, due to the lowest new vehicle inventory levels for dealers since 2011 and the fact that this August had two fewer selling days.

Kentucky’s role in the automotive industry is strong. Toyota Motor Manufacturing Kentucky and its 8,000 team members in Georgetown assemble and build the Camry, Camry Hybrid, RAV4 Hybrid, Avalon, Avalon Hybrid, Lexus ES 350, and fourcylinder and V-6 engines. More than 11 million vehicles total have rolled off the production line at its 1,300acre site since 1988.

Ford Motor Co.’s Louisville Assembly Plant and its 4,100

GM photo

GM’s Corvette assembly plant in Bowling Green brought on a second shift at the end of August, adding more than 400 jobs.

employees produce the Ford Escape and the Lincoln Corsair. Ford’s second Louisville operation, the Kentucky Truck Plant with 8,900plus employees, produces Ford F-250 through F-550 Super Duty Trucks, the Ford Expedition and the Lincoln Navigator.

And 100 miles south, Bowling Green is home to the only Corvette manufacturing plant in the world. On August 31, General Motors brought on a second shift with more than 400 hourly jobs at the Bowling Green plant, increasing the workforce there to 1,300 to meet demand for Corvettes and 495-horsepower 6.2-liter V8 engines.

Since 2011, GM has invested more than $900 million in the Bowling Green plant, according to the company’s website. That figure includes “a new body shop, increased engine capacity, new paint shop, a new Performance Build Center and additional plant upgrades,” the site says.

So what’s the big picture now, with a pandemic afoot? The news is mixed.

U.S. automakers reported a 30% drop in domestic sales in the second Champion Chevrolet Buick GMC in Louisville never fully shut down due to COVID-19, but temporarily closed its showroom this past spring and moved to online transactions and remote delivery.

Champion photo

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October 2020 43

MANUFACTURING

Paul Miller photo

quarter this year, the worst showing since the Great Recession, a July CNN report showed. The same report revealed that GM weathered a 34% sales drop, and Toyota a 35% drop, before rebounding in May. But according to an early September report from market and consumer data portal Statista, there were nearly 1.36 million vehicles sold in the U.S. in August 2020, following a gloomy spring rife with shutdowns and uncertainty as the pandemic took hold.

Building upon the May rebound, light truck sales topped 1 million units in August for the first time since February this year, though compared to last year’s figures, motor vehicle sales are still down about 20%. Statista predicted in late summer that light vehicle sales would range between 14.5 and 16.4 million units this year—the larger figure contingent upon COVID-19 being contained quickly, and the lesser forecast if the crisis continues.

That compares to around 17 million new light vehicles sold in 2019.

But even now, some hopeful signs have emerged. An August Axios report cited U.S. Commerce Department figures that showed in June, orders for motor vehicles and parts were up 86.2%. The report also noted Volvo (+10.3%), Mazda (+3.4%) and Hyundai (+.6%) sales doing even better than last year’s sales figures this past July.

Sales process shifts online Along with masked employees and copious amounts of sanitizer on the sales floor, other changes have come 44

October 2020

to auto dealerships like Swope’s, such as moving the bulk of the sales process online. In the past, Swope said, customers researched potential purchases online, saving face-to-face dealings with sales reps for the final confirmations and transactions.

The pandemic hastened the industry’s move to a more digital way of doing business, Swope said, with about 90% of transactions now online-capable. The real sticking point, he said, is that Kentucky’s vehicle titling system requires in-person signing for titles and transfers. Through an executive order, some digital document signing is now allowed, he said, but it can be cumbersome.

Fred Tolsdorf is president of Champion Chevrolet Buick GMC – Louisville. He’s owned the dealership for 16 years and entered the automotive sales business in the 1980s.

Tolsdorf said his dealership never fully shut down this past spring, but the showroom was temporarily off limits, replaced by online transactions and remote delivery.

“We’re still doing more of the transactions online,” Tolsdorf said, “but the customers ultimately want to see and drive the vehicles before they commit to it, so we’ve been back to doing in-person deliveries.”

Lexington-based Paul Miller Motor Co. CEO JP Miller, who’s also past chairman of KADA, has over 20 years under his belt in automotive sales.

His dealerships weren’t shut down entirely, but there were reduced hours companywide in mid-March

The team at Paul Miller Motor Co. in Lexington launched mobile customer sales and service in March and allows customers to do all paperwork online.

as mobile customer sales and service launched as an alternative.

“We turned our systems into a more customer-facing digital experience and built out a delivery process basically where it allowed you to do your paperwork all online,” he said.

Vehicles are sanitized and brought to customers for test drives and paperwork is processed in customers’ front yards. A mobile service division now performs delivery and pickup and can conduct oil changes at customers’ homes. Additional hours were allotted to prioritize first responders’ service needs, and health screenings, barriers and distance markings on the floor were implemented.

“That is all going really well,” Miller said.

Trucks, SUVs still in high demand New vehicle inventory supplies decreased when manufacturers were shut down for a time in the spring as the nation grappled with the emerging virus.

John Savona is vice president of North American Manufacturing at Ford, and previously served as plant manager of the Louisville Assembly Plant in 2011. After that, he became director of manufacturing for that facility as well as the Kentucky Truck Plant and another Michigan-based plant, and now his role extends to lanereport.com

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MANUFACTURING

Prior to COVID-19, it was common to see rows of cars lined up at auto dealerships, but after many vehicle assembly plants had to shut down due to the virus earlier this year, dealers are selling cars as soon as they hit the lots.

plants throughout the U.S., Canada and Mexico.

He said the two Louisville plants together employ about 13,000 people and production resumed to normal levels in late June after a two-month spring shutdown.

“Both plants are producing high volume with high quality and do it safely,” he said.

Savona said being a global company, Ford worked on a global safety plan that began in China, where the virus originated, on to other affected regions, and then to the U.S., engaging experts like epidemiologists and others outside the auto industry and learning along the way.

“Our vehicles are flowing out of our assembly plants on a normal basis right now and demand is really strong for our products across our Ford system, particularly for our plants there in Louisville,” he said.

Though no one can predict when the virus will be eradicated, Savona said he’s proud of his team and its good track record of keeping COVID-19 at bay in facilities by engaging with safety protocols.

Manufacturers are working diligently to get their feet back under them and ramp up production to get vehicles to dealerships that 46

October 2020

consumers want to buy, Swope said.

Trucks and SUVs are in greatest demand, unseating sedans over the past few years, he said.

Fluctuating inventories pose occasional challenges. Typically dealerships maintained 60 to 90 days’ worth of vehicles on their lots, Swope said. During the spring shutdown, inventories held steady, where they stayed until reopening in early May. But since that time, new car inventories have dropped to around a 40-day supply, sometimes 30, he said.

“It’s just a game every day of protecting people, protecting each other from spreading COVID-19, protecting customers, protecting the community but also satisfying customers with the vehicles they want to purchase,” Swope said.

Tolsdorf said Corvette sales have been unaffected by COVID-19, with his three-year waiting list intact.

He said Silverado and Sierra pickup trucks are hot sellers, as well as new Tahoes and Yukons. Manufacturing is still not back to normal levels with many vehicles in transit, but he expects by early October that inventories will have normalized.

All told, he said, the road ahead looks bright.

“I think business is going to be good for the next couple of years,” he said. “I think there’s definitely demand—I really don’t see anything that’s negative.”

Miller said he’s excited about the Kentucky-built Ford Escape selling well, as well as the rebirth of the Ford Expedition.

“It’s been pretty exciting to see a lot of our repeat customers coming back in and buying the Escape and buying the Expedition because they’ve been remodeled and they have a lot of great safety tech and benefits,” he said.

Ford F-series trucks have seen a boost in sales with increased activity in area construction and horse farm industries, he added. And rebates, tempting interest rates and the value of used cars have combined for a great opportunity for some consumers to make a trade in and have similar payments for a brand new vehicle, Miller said.

Sales forecast is strong Some trends that took root in a changing world this spring may become long-term. An August Wall Street Journal article reports that Arizona-based Carvana, an online company that recently opened one of its eye-popping, eight-story car vending machines in Louisville, experienced a 25% increase in second-quarter vehicle sales. Its total revenue was up 13% to $1.12 billion between April and June 2020.

A New York Times article earlier this year said GM reported 750 of its dealerships opted into its “Shop Click Drive” e-commerce system in the first few months of the pandemic, with more than 85% of its domestic dealers using the system.

Meanwhile, Kentucky’s auto manufacturing plants are up and running again with new safety lanereport.com

protocols in full force, and the fourth generation of the Ford Expedition will start production later this year in Louisville.

Swope said “as long as there’s not another major flare-up” of COVID-19, manufacturers will continue to catch up with demand.

In Louisville, Byerly Ford and Byerly Nissan Vice President David Daunhauer said his family has been in the automotive business since 1944, and he has been involved for the past 25 years.

Daunhauer said parts, service and body service departments remained open as they were deemed essential, but customer traffic still dropped 35 to 40% temporarily. In sales, phone and virtual meetings with customers are now the norm, along with meeting customers off-site at their house or a neutral location.

Despite the changes and challenges, Daunhauer said sales are comparable to what 2019

Carvana, which recently opened one of its eye-catching car vending machines in Louisville, reported a 25% increase in second-quarter vehicle sales.

summer sales were and the service department is back to normal levels– if not busier. The body shop is still not as busy, but he said that may be because fewer people have been on the roads, and thus fewer accidents requiring body work.

Ford F150s, Escapes and Rangers are all popular Kentucky-made models with strong sales, he said.

Consumers can pick out, pay

online and schedule a time and place for delivery, he said.

But now, Daunhauer says, some are returning to in-person transactions.

“I think they really wanted the chance to kick the tires, test drive it and all that sort of stuff,” he said. ■ Shannon Clinton is a correspondent for The Lane Report. She can be reached at editorial@lanereport.com.

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October 2020 47

AGRIBUSINESS

America’s New Produce Section $150 million AppHarvest project in Morehead looks like the jumpstart Kentucky ag-tech seeks

BY DEBRA GIBSON ISAACS

T

HIS article is about AppHarvest, Eastern Kentucky’s newest hightech agriculture company and the first big step toward Gov. Andy Beshear’s ambitious larger goal of turning the region into the country’s agricultural technology capital.

But AppHarvest is also about much more— significant water conservation, the ability to grow healthy food in any season and on relatively small amounts of land.

It is about creating jobs in an economically starved area of the United States and teaching local young people the skills they need to get those jobs.

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October 2020

AppHarvest is even about international collaboration and cooperation as well as creating a model others can follow.

First you must plant a seed AppHarvest started as do most companies, with lofty dreams and searches for financing. Months or years later, there’s a groundbreaking, facility construction or retrofitting, a ribbon cutting, and (cross your fingers) an economically profitable product. And jobs.

This time it was Jonathan Webb’s dream.

Before starting AppHarvest, Webb worked in renewable energy with the Department of Defense on one of the

AppHarvest founder Jonathan Webb has a vision to create the nation’s agricultural technology capital in Appalachia.

largest solar projects in the United States. He focused on implementing installations at bases to meet a White House goal that the military’s hundreds of facilities develop resilient on-site power generation and obtain 20% of their electricity from renewable sources by 2025.

While working in renewable energy, Webb came across an article on the high-tech indoor farms in the Netherlands, which happens to be an ag powerhouse. As he learned more about the technology and agricultural practices, Webb was stunned to find lanereport.com

Numbers Tell the Story

“O

UR goal is to promote a future of sustainable change in the agriculture industry,” says AppHarvest founder and CEO Jonathan Webb. “Our controlled environment facilities reduce water consumption and eliminate pesticides, reducing our impact on the planet.”

Some of the statistics from AppHarvest’s website underpin why there is such enthusiasm for the endeavor.

90% less water usage: High-tech greenhouses distribute water more efficiently, reducing usage by 90%.

365 days: Growing indoors eliminates weather and seasonal constraints, to create a resilient food source.

40% better: The hybrid lighting system in the massive greenhouse uses Philips GreenPower LEDs, which are 40% more efficient than typical lighting. The system increases harvest while reducing natural gas usage in cooler months.

30x: A 10-acre rainwater retention pond completely eliminates agricultural runoff, the cause of toxic algae blooms.

80%: Morehead, the site of the company’s new high-tech greenhouse that will open this fall, is within a day’s drive of 70% of the U.S. population, reducing diesel use or product transportation by 80% and allowing fresher produce to compete against low-cost foreign imports.

a single acre of indoor farm yields as much as 30 traditionally farmed outdoor acres—while dramatically reducing water usage.

Thoroughly intrigued, Webb moved back to his home state of Kentucky in early 2018. After meeting and working with investors, advisers and politicians of both parties, he founded AppHarvest and set about the complex pursuit of defining, locating, designing, financing and building a project in Eastern Kentucky.

Sometime in the next several weeks, a massive high-tech greenhouse will begin production of tomatoes and cucumbers.

“Continuous innovation and cutting-edge technology will enable AppHarvest to generate 30 times the yield of open-field agriculture,” said

lanereport.com

Webb, who now serves as CEO of AppHarvest. “At our flagship facility in Morehead, we’ll do it all with no agricultural runoff, no chemical pesticides, zero soil usage and 90% less water.”

Founded as a benefit corporation— committing to creating public benefit and sustainable value in addition to profit—AppHarvest is also a Certified B Corporation as assessed by the nonprofit B Lab, a further commitment to balance purpose and profit that includes a legal obligation to consider the impact of decisions on its workers, customers, suppliers, community and the environment.

“We have a vision to create America’s ag-tech capital from within Appalachia,” Webb said, “and that includes providing better produce, better farming practices and better jobs.”

It’s a model that already exists actually.

unique system to dramatically reduce water usage compared to typical greenhouses and open-field agriculture.

“When paired with a sophisticated closed-loop irrigation system, our 10acre rainwater retention pond allows

Importing smarts “We promote permanent sustainability advances in American agriculture by using proven technology, perfected by the Netherlands,” Webb said. “The country is the world’s second-largest agricultural exporter ($96 billion in 2017), second only to the United States, despite being roughly equivalent in land mass to Eastern Kentucky.”

With Dutch experts’ input, AppHarvest has developed a October 2020 49

AGRIBUSINESS

Solving Problems to Benefit All

A

S a Benefit Corp., AppHarvest aims to solve four distinct problems: America needs to farm more sustainably: Controlled-environment agriculture technology will allow AppHarvest to grow non-GMO (genetically modified organisms), pesticide-free produce year-round using 90% less water than traditional farming. The 60-acre facility’s needs will be met entirely with a 10-acre retention pond and sophisticated circular irrigation systems. These growing techniques have been perfected in the Netherlands, which realizes incredibly high yields and is the world’s second-largest exporter of ag products with a land mass similar to Maryland.

America needs a homegrown food supply: The U.S. relies increasingly on imports, with produce picked pre-ripe and aged up to a week on a truck before briefly sitting in grocery bins. AppHarvest’s Morehead site near I-64 is within a day’s drive of 70% of the U.S. population, and cuts 80% of diesel use for transport to the East Coast from the supply chain.

America needs better access to nutritious food: Just one in 10 adults eat enough fruits and vegetables, according to the Centers for Disease Control and Prevention. Feeding America, a nonprofit dedicated to hunger relief, estimates 12.9% of Americans at times struggle with lack of access to enough nutritionally adequate food and 17.5% of children deal with food insecurity. AppHarvest expects to improve access to fresher, cost-competitive produce.

Appalachia needs investment and jobs: The coal industry, long Appalachia’s dominant industry, is in decline and its employment is the lowest level since 1898; 50,000 miners have lost their jobs.

One in four residents throughout Appalachia live in poverty. In Morehead, where AppHarvest’s first facility has been built, the U.S. Census Bureau estimates 23.7% live in poverty compared to 12.3% nationally. AppHarvest has educational partnership initiatives for employees with regional universities and colleges.

50

October 2020

us to harvest large quantities of highquality rainwater that can be used— and reused—for plant irrigation,” Webb said.

The company’s goals caught the attention of the right people and financing options came—Equilibrium Capital of San Francisco took the largest piece, $82 million, and this August AppHarvest closed $28 million in Series C funding that included big investment brand names and brought Martha Stewart to its board.

They have literally bought into the idea of incorporating knowledge from the Netherlands to build a 60acre greenhouse in Morehead to grow non-GMO (genetically modified organisms), chemical-free produce.

That’s one of the largest greenhouses in America if you’re counting.

AppHarvest’s first controlledenvironment agriculture facility will create 285 permanent full-time jobs as well as 100 construction jobs.

Distribution partner Mastronardi Produce will deliver the completed facility’s tomatoes and cucumbers to America’s top grocers.

Based in Kingsville, Ontario, Canada, Mastronardi is North America’s largest producer and distributor of greenhouse-

grown produce. The fourth-generation, family-owned company provides tomatoes, peppers, cucumbers, lettuce and eggplant under the Sunset brand as well as WOW berries. Mastronardi opened its own sixth greenhouse in 2018 in northeast Ohio.

U.S. supermarkets compete directly on produce, the quality of which is known to drive decisions on which stores shoppers choose. The chains have widened aisles, improved lighting and made other upgrades to their produce sections, which are right inside the front door.

“Our first tomatoes will be on store shelves by the end of this year,” Webb said. “Because our tomatoes won’t travel as far to get to your plate as the typical tomato grown in the southwestern U.S. or Mexico, we can pick them when they’re ripe.

By contrast, others pick tomatoes around a week before they’re ready.

Shoppers can visibly see they’re not ideal tomatoes and won’t taste fresh.”

It is a goal that some AppHarvest product will be in stores the day it is picked. The same geographic advantage that has made Kentucky a logistics powerhouse is about to start benefiting its agritech aspirations.

The AppHarvest 60-acre greenhouse project near Morehead, Ky., expects to satisfy all its water needs with a 10-acre pond that gathers rainwater for highefficiency recirculation.

International agreement On June 24, Gov. Beshear signed an agritech agreement with 16 other partner organizations, including the Dutch government. The governor, who made reference to the state’s

lanereport.com

agritech potential during the 2019 campaign, also established an AgriTech Advisory Council to guide the commonwealth’s increased focus on this industry, which is laid out in detail at agritech.ky.gov.

AppHarvest led the signing of the partnership, which includes six Dutch ag-tech companies, the Dutch Ministry of Agriculture, two Dutch universities and the Netherlands’ public-private network organization NLWorks.

“This partnership represents the culmination of more than two years of work that saw multiple delegations of Kentucky representatives visit the Netherlands,” Webb said.

The Kentuckians met leaders at Dutch companies that are redefining agriculture and the Netherlands also sent top officials to Kentucky to meet with Beshear, university leaders and economic development officials.

“Universities and private companies were also instrumental in this success,” Webb said. “Each of these organizations share our vision to create America’s ag-tech capital from within Appalachia.”

The timing could be right.

“In Kentucky, we’re going to reopen and rebuild our economy even stronger than it was before COVID-19,” Beshear said during the June announcement event. “Partnerships like this one highlight our state’s 21st-century leadership and limitless potential.

I can’t wait to see the agritech industry continue to grow in Eastern Kentucky, led by AppHarvest and other companies that are reimagining the future of farming.”

lanereport.com

The Netherlands is a global center of precision farming expertise, having persistently pursued food independence since a late World War II famine killed 10,000 to 20,000 of its residents. Today it has 5,300 agri/food companies as well as major research and development or production operations by 12 of the

The sun comes up over the construction for an advanced 60-acre greenhouse that AppHarvest is building near Morehead.

Using sustainable agriculture technology developed in the Netherlands, it plans to supply tomatoes and cucumbers to supermarkets throughout the U.S. East Coast market that now get produce that spends days being trucked from Mexico and the Southwest.

Governor’s AgriTech Advisory Council

G

OV. Andy Beshear established and chairs the Governor’s AgriTech Advisory Council. It includes leaders in state government and local government, education, and the business and labor sectors in Kentucky.

Members include: • Ryan Quarles, Kentucky commissioner of agriculture • Dorsey Ridley, executive director, Governor’s Office of Agriculture Policy • Aaron Thompson, president, Kentucky Council on Postsecondary Education • Lt. Gov. Jacqueline Coleman, secretary, Kentucky Education and Workforce Development Cabinet • Mike Berry, secretary, Kentucky Tourism, Arts and Heritage Cabinet • Larry Hayes, interim secretary, Kentucky Cabinet for Economic Development • Rebecca Goodman, secretary, Kentucky Energy and Environmental Cabinet • Dr. Eli Capilouto, president, University of Kentucky • Robert L. (Bob) Jackson, president, Murray State University • M. Christopher Brown II, president, Kentucky State University • Linda Gorton, mayor, LexingtonFayette County Urban Government

• Laura White-Brown, mayor, City of Morehead • Mason Barnes, judge-executive, Simpson County • James Kay, judge-executive, Woodford County • Ashli Watts, president/CEO, Kentucky Chamber of Commerce • Bill Finn, state director, Kentucky State Building and Construction Trades Council, representing Kentucky labor and trade • Eric Gregory, president, Kentucky Distillers’ Association, representing Kentucky labor and trade • Mark Lyons, president/CEO, Alltech, representing Kentucky businesses related to agriculture and agricultural technology • Jonathan Webb, founder/CEO, AppHarvest, representing Kentucky businesses related to agriculture and agricultural technology • Shubin Saha, chief operating officer, Kentucky Fresh Harvest, representing Kentucky businesses related to agriculture and agricultural technology • Trevor Claiborn, co-founder, Black Soil, representing Kentucky businesses related to agriculture and agricultural technology

October 2020 51

AGRIBUSINESS

world’s largest corporations in the sector.

“This long-term partnership will add jobs and create a new signature industry for our Appalachian region,” Webb said. “It also demonstrates the kind of international cooperation that we need more of on the national level.”

The guiding agreement calls for a series of research programs, construction of a center of excellence, and building additional private infrastructure similar to AppHarvest’s 2.76 million-s.f. indoor farm, which it plans to open this fall in Morehead.

The agreement also calls for the partners to open a Dutch representative office in Kentucky to spur investment in the state by Dutch companies. $150 million in financing To date, AppHarvest has attracted more than $150 million in investment into Appalachia in just two years.

Investors include hedge fund ValueAct Capital’s ValueAct Spring Fund, Revolution’s Rise of the Rest Seed Funds, and Equilibrium.

The $82 million all-cash infusion last year by Equilibrium Capital’s Controlled Environment Foods Fund paid for the construction of the greenhouse in Morehead.

In addition to food icon Stewart, the expanded AppHarvest board includes David Lee, chief financial officer of Impossible Foods, the maker

Produce raised in greenhouses in Eastern Kentucky can be picked ripe and delivered to eastern U.S. supermarkets in a day.

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October 2020

of plant-based meat substitutes.

ValueAct Capital Founder and CEO Jeffrey W. Ubben also has a seat on AppHarvest’s board of directors and a track record of finding companies with strong growth potential; ValueAct ran a Series A round of funding for AppHarvest.

Revolution’s Rise of the Rest Seed Fund, led by AOL co-founder Steve Case and best-selling author J.D. Vance, made a follow-up investment in AppHarvest as part of the Series A, adding to its initial seed funding.

The Rise of the Rest Seed Fund invested in AppHarvest as part of its focus on working with entrepreneurs outside of Silicon Valley and other coastal tech hubs.

Ag-tech education and certifications In addition to taking care of business, AppHarvest also is collaborating with Eastern Kentucky high schools to introduce and incorporate ag-tech curriculum.

At Shelby Valley High School in Pike County, AppHarvest is working alongside public school officials to build ag-tech curriculum and educate students about local career paths in this field. At this pilot location, a shipping container retrofitted with cutting-edge technology provides students hands-on experience in a hydroponic learning laboratory. Their certified Kentucky Proud harvests are providing a local source of fresh food.

AppHarvest is working with the University of Pikeville to create a high-tech agriculture certificate program to prepare students for

AppHarvest is conducting outreach to regional education systems, bringing students in for visits to see its planned advanced agriculture technology system for growing produce in Eastern Kentucky to supply the eastern United States.

careers in the region’s burgeoning industry. UPIKE President Burton Webb has met with top political, agricultural and educational leaders in the Netherlands.

“With each step forward, AppHarvest is working to build an ecosystem that will sustain the future of the region,” Webb said. “As a university, we are committed to providing the skilled workforce necessary to maintain that momentum.”

Right now, AppHarvest is focused on two goals, according to its CEO: opening its controlled-environment agriculture facility in Morehead and developing the infrastructure to build future projects.

“Agriculture’s needs are daunting in the coming decades,” he said, “so we want to make as big an impact as possible from the start. We look forward to continuing construction of facilities throughout central Appalachia to help meet America’s growing food needs. We’re also expanding our educational programs in high schools and colleges across Eastern Kentucky. Our goal is to increase interest in ag-tech in the region to help build an inclusive, resilient Appalachian economy for the future.” ■ Debra Gibson Isaacs is a correspondent for The Lane Report. She can be reached at editorial@lanereport.com.

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TOURISM

Local Tourism Fuels Rebound Shelbyville is using its walkable downtown to lure more regional visitors while domestic and international travel options are limited.

In 2019, Shelby County had the state’s highest visitor spending growth, with a 10% increase over 2018.

‘Stay Close, Go Far’ pitch proving successful for Kentucky’s smaller destinations

BY ABBY LAUB

Cheryl Van Stockum Photography photo

“S

TAY home” doesn’t bode well for the tourism industry, but as homeweary travelers look for travel and entertainment in the midst of a pandemic, Kentucky’s small towns are ready to fill the void— while creating some much-needed economic stimulus.

In Shelby County, ShelbyKY Tourism President/CEO Chenelle

McGee is hopeful the county, ideally situated just off of Interstate 64 between Lexington and Louisville, will see small businesses positively impacted by tourism.

“As we continue to develop and recreate how we do business in order to recover the tourism and hospitality industry, 2019’s economic impact report provides an optimistic outlook to our partners,” McGee said. “The Kentucky Department of Tourism report indicates that visitors are enjoying Chenelle the balance of the McGee, rural countryside President/ and luxury, crafted CEO, ShelbyKY experiences Shelbyville Tourism has to offer.”

In a pandemic, offering components such as agritourism, abundant hotel space, non-crowded attractions, walkability and outdoor features goes a long way.

Courtney Glenny took full advantage of this in August when she took a girls’ trip to Shelbyville that included outdoor yoga in Stargazer Pavilion downtown, a trip to take in the collectibles at Wakefield-Scearce Galleries in the historic Science Hill Academy compound, and ample dining and shopping—all enjoyed by foot.

A girls’ weekend in Shelbyville in September included an outdoor yoga session in the all-new downtown Stargazer Pavilion.

It was one of three major downtown improvements created to lure more people downtown and offers a safer, outdoor option for pandemic travelers.

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October 2020

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“Shelbyville, was a quick, easy and fun girl’s weekend destination,” said Glenny, a blogger and writer at The Glenny Girl. “I was overwhelmed with the small-town charm and ample opportunities for new experiences available. The patio dining, local shops, historic sites, and accommodations were all clean, and I had no fear of traveling during COVID with the given safety measures the town and locals had set in place.”

Glenny isn’t the only one visiting.

Figures released by the Kentucky Department of Tourism show that in 2019, Shelby County had the state’s highest visitor spending growth rate, with a 10% increase. Visitor spending increased by $4.3 million—from $42.6 million in 2018 up to $46.9 in 2019. Total business sales generate $334 in state and local taxes for every household in Shelby County.

“This growth in visitor spending and the need for social distancing provided the framework to focus on niche market groups through ‘crafted’ experiences,” McGee said.

“These crafted experiences provide an opportunity for a much-needed

Cheryl Van Stockum Photography photo

Guests in Shelbyville enjoy ample locally owned boutique shopping opportunities, all within easy walking distance of each other.

break while participating in curated experiences specifically designed for your group of family and friends.”

Tourism is too big to fail The Kentucky Department of Tourism has some eye-opening numbers to show the sector’s impact on state revenue streams—public and private—and why getting tourism moving again is so critical. Statewide, visitors to Kentucky spent nearly $8 billion in 2019, which, including indirect and induced impacts, generated $11.8 billion in total business sales. Tourism in Kentucky produced $1.5 billion in tax revenues in 2019, with $823 million accruing to state and local governments.

Approximately 3.7% (one in 26) of all jobs in the state are sustained by tourism. These jobs generated total incomes of $3.1 billion in 2019, up from $2.9 million in 2018. This meant 95,803 visitor-sustained Kentucky jobs in 2019, divided between 68,563 direct and 27,240 indirect and induced jobs.

Nationally, the U.S Travel Association is heading the sector’s advocacy for the Coronavirus Relief Bill, but many industry partners are pushing for federal aid, like Louisville Tourism, which recently had to slash its $25 million budget to $14.9 million.

The losses are major in big cities.

Unfortunately for the tourism industry nationwide, avoiding traditional large-city destinations has been the strategy for travelers leery of being in large crowds.

Preventative bans on travel have been imposed at times by some states, making such trips additionally prohibitive. However, it dawned on Kentucky tourism officials that this could present a strategy for smaller commonwealth communities.

The Kentucky Department of Tourism is trying to help local tourismrelated businesses survive and recently launched a “Stay Close, Go

Many of Kentucky’s most famous and beloved attractions, like Bardstown’s My Old Kentucky Home pictured at left, have found safe and innovative ways to welcome guests to the property despite pandemic limitations.

lanereport.com

October 2020 55

TOURISM

other’s audiences to deliver them a new product. Right now, there is no stone left unturned.”

VisitOwensboro photo

State tourism figures show that from 2015-2019 overall visitor spending has grown 17%, from $6.8 billion in 2015 to nearly $8 billion in 2019. In 2019, 25% of that was in the food and beverage sector, which was the largest percentage of the measured sectors.

Far” campaign to promote local, safe travel for recreation. The marketing initiative is aimed at supporting local tourism partners, communities and businesses by producing inspiring content that reminds Kentuckians they do not have to travel far to experience the beauty, history and adventures their state has to offer.

It is timely: A recent traveler sentiment survey from Longwoods International showed 63% of travelers planning a trip over the next six months said it will be centered on driving.

‘Stay Close, Go Far’ gets traction “We want this campaign to generate a new excitement, especially for those who call the Bluegrass State home, encouraging Kentuckians to safely travel, explore and experience a new adventure right in their own backyard,” said Mike Mangeot, commissioner of the Kentucky Department of Tourism. “From our 56

October 2020

unique small towns to our large cities, the many lakes across the state, mountains, caves and forests to bourbon distilleries, historic battlefields and horse farms, Kentucky always has new places to discover.”

For Troy Beam, executive director of the Shepherdsville-Bullitt County Tourist Commission, the fact that would-be travelers are opting to stay close to home bodes well for his local attractions like Kart Kountry, Bernheim Forest, wineries and the Awesome Flea Market.

“We are a long way from (business activity levels of) pre-pandemic times, but the ‘Stay Close, Go Far’ message resonates well for our regional folks and every little bit helps,” Beam said. “Kart Kountry (a family activity amusement park) is doing better than expected, but the others are just holding their own. In this atmosphere, holding your own is not too bad.”

Dave Kirk of Visit Owensboro said Owensboro typically relies on its formidable convention center and sports tournaments to bring in visitors.

“We’ve partnered with Bowling Green and Paducah a lot, and we are doing trades and sharing social media for cross promotion,” Kirk said. “We’re taking advantage of each

Small-town charm has big appeal Shelbyville can fill a big role and boost the economy, says McGee. “Even with ShelbyKY’s charming size, our community has tons of unique accommodations and hidden gems to uncover,” she said. “No need to get on a plane. Instead pack up the car with a few of your favorite roadtrip tunes and hit the back roads.”

She touted downtown Shelbyville’s charming and quiet downtown accommodations located directly on Main Street and the walkable downtown that affords the ability to go by foot for much of your visit.

McGee notes Shelby County is home to bourbon distilleries like Jeptha Creed and Bulleit.

“Both are open for unique experiences and feature interesting stories for all walks of life—whether you like to imbibe in Kentucky’s native spirit or not,” she said, adding the county is also known for beautiful horse farms, history and geography.

For those who enjoy a food theme to their explorations, there is even the ShelbyKY regional burger trail.

Foodies of the family will get a savory experience designed to send participants all over beautiful local countryside.

McGee said tourism numbers are beginning to rise as people start to feel safe again and restrictions continue to lift. There are some new visitor-focused additions to the business lineup, like Nathan’s Famous Hot Dog and drive-in movies at the Simponsville Outlet Mall, and the Stargazer Plaza, Sculpture Walk, Spotz Gelato, Wings and Things, and Pisco Sour in downtown Shelbyville.

“Shelby County (hotel) occupancy is down 26% for April to August of 2020 compared to the same timeframe in 2019,” she said. “However, April to August of 2020 has shown a steady rate of recovery, with a 21% increase in occupancy compared to April (Shelby’s lowest monthly rate on record). These numbers do not include our Airbnbs, which also are lanereport.com

A young shopper peruses the Heaven Hill Distillery gift shop. Retail accounted for $1.6 billion in visitor spending in 2019.

seeing a major recovery over the last few months—up 25% since April.

Shelbyville and Simpsonville restaurant sales were down 23% for the March to August 2020 period compared to the same time in 2019.

“Shelbyville and Simpsonville restaurants sales averages are also up 49% since April 2020. While restaurants and lodging are rising in demand, the lack of (business cash) reserves due to previous closures remain a concern for many, including our attractions,” McGee said.

Resilient industry reinvents opportunity Kirk said Owensboro has seen people coming back for its branded combination: bourbon, bluegrass and BBQ. Noting that the area has seen comparatively fewer COVID-19 cases, Kirk said, “People look at Owensboro as a safe haven (from COVID-19) if you will. It’s familiar, it’s smaller, but there is still stuff to do. We brand ourselves as ‘small town, big city amenities.’ If this has taught us

Local Feed, a seasonal kitchen and craft bar in Georgetown, is one of countless restaurants in Kentucky that used outdoor seating to better accommodate guests.

The restaurant attracts guests with its unique history as an ice house across the street from where Elijah Craig is said to have pulled water to first make bourbon.

lanereport.com

anything, it is that there’s more of an opportunity to go after that leisure traveler than we previously thought.

Our numbers are not good, but they’re better than expected.”

Lori Saunders, executive director of Georgetown/Scott County Tourism, expresses similar sentiments.

“The tourism industry has proven to be very resilient,” Saunders said. “Despite all the challenges, we decided to see COVID-19 as an opportunity and not adversity.

It pushed us to move out of our comfort zone so that we could better transition into this new environment.

“We have been able to create new partnerships, reinvent marketing strategies and messaging, attract new audiences, and give even greater support to our local businesses and community,” she said. “I am most proud of the fact that we put people first and made a conscious effort to share the stories of our community and of our locals via social media and our new Georgetown Inspires Guide.

“By simply sharing a recipe from a local restaurant, an unknown story of Georgetown’s history or highlighting an act of kindness in our community, we’ve been able to connect our businesses with the people who call Georgetown their home,” Saunders said. “At a time when people have been kept apart, we’ve done our best

to keep the spirit of Georgetown alive in people’s hearts and minds.”

By choosing to lean into the need to innovate that pandemic distancing brought, she feels they have been given the opportunity to inspire backyard vacations and “staycations.”

“Kentuckians are once again embracing the Bluegrass State,” Saunders said. “Our local visitors have an urge to explore all that Kentucky has to offer; it’s like a reawakening to the grandeur of our state. We hear many times from our visitors that they want to contribute to the recovery and by traveling within Kentucky they are keeping those dollars local.”

This is precisely what the state’s tourism department hoped to achieve with the “Stay Close. Go Far.” campaign.

“Kentucky is fortunate to offer so many unique experiences that families can enjoy safely and stay close to home,” said Kentucky Tourism Arts and Heritage Cabinet Secretary Mike Berry.

“It is our hope that the campaign will encourage safe and responsible in-state travel while helping place Kentucky on a path to economic recovery through tourism spending and employment in our local communities.” ■ Abby Laub is a correspondent for The Lane Report. She can be reached at editorial@lanereport.com.

October 2020 57

PUBLIC POLICY

Continuous Budget Calculus There’s a hole in the Road Fund, but the state’s General Fund is up

BY BOB BABBAGE AND JULIE BABBAGE

K

ENTUCKY’S unique two-year budget, the foundation for public priorities, became a one-year budget this pandemic year when numbers were hard to predict. This means that 2021 needs a new budget, followed by 2022 when another twoyear budget is due.

Continuous budgeting is a good match for State Budget Director John T. Hicks, who brings 36 years experience to the role along with a stint heading up all state budget officers through their national group.

Hicks’ most recent report to lawmakers, taxpayers and stakeholders is laced with positive points along with areas of concern. If there is a theme to public budget-making now, Hicks would say “uncertainty” applies.

Despite dire revenue warnings nationwide in April, Kentucky ended 58

October 2020

the fiscal year in June with a $177.5 million surplus. Agencies cut their budgets in anticipation of losses, but taxes topped estimates.

Whether you own a firm or run a state’s finances, key indicators count. Hicks is constantly concerned with education, since 55% of the General Fund goes to pre-K through 12 along with all our community colleges and universities. COVID-19 expenses reshaped the education budget, adding costs.

Similarly, Medicaid is top of mind as a major cost factor. When times get tough, Medicaid grows. To meet the demand, a 6.2% “enhancement”

was added to the federal share of state costs, providing millions. This is set to stop when there is no longer an “emergency”—a decision left solely to Health and Human Services Secretary Alex Azar.

There is a major deficit in the Road Fund, where income was 23.6% below what was expected. Road funds come from the taxes paid at the gas pump. When the coronavirus “stay at home” message hit, the Road Fund took a hard hit, since most of us were not filling the tank. Many still are not driving as often.

Compare April, May and June 2019 to this year and you will see $100 million less in the Road Fund– $324.6 million compared to $424.8 a year ago. The simple result is a significant delay to road and bridge improvements and expansions.

Hicks told the House and Senate members who focus on the budget that the state’s economy was artificially enhanced by $3.3 billion going to unemployed workers. Also juicing the numbers was $5.2 billion from the Paycheck Protection Program.

Prior to this COVID-19 crisis help, Kentucky’s revenues fell 4.5% in the first quarter. Hicks notes that this followed 12 winning quarters of growth.

Right now the state has $465 million in the rainy day fund. And as

Rep. Steven Rudy, a Republican from Paducah, chairs the House Budget Committee. lanereport.com

of mid-August, Hicks said the state had committed spending less than half its $1.6 billion in federal aid related to the coronavirus.

The House Budget chair, Rep. Steven Rudy, R-Paducah, runs a command center as the House originates the budget. He offers two words as he works ahead: cautiously optimistic.

Even though the session is short, Rudy recalls a teachable moment.

The legislature failed to pass a budget in 2004. Then in the 2005 short session with the House Democratic and the Senate Republican, the General Assembly passed a balanced budget with Gov. Ernie Fletcher’s tax modernization on top. “Good things can happen,” Rudy said.

One sixth of the way into the current fiscal year, Kentucky tax revenue in the General Fund is ahead of the prior year by about 7%, artificially boosted by various federal dollars. Rudy reminds us that last October to March the Kentucky economy set records with the business sector “absolutely rolling” by his count.

He notes the state then went from record employment levels to our now historic rate of unemployment.

Federal funding from the CARES Act is not fully accounted for, he notes, but is a goal for Rudy and his budget-making panel. Back in August the legislature learned 45% of coronavirus-related federal funds are already committed. As for further federal funds for state and local governments, Rudy is “not counting on it” anytime soon.

State Budget Director John T. Hicks

lanereport.com

Parallel to the budget is the unemployment insurance debt, a near-billion-dollar loan the state took to pay pandemic unemployment benefits to those out of work.

Employers are stuck with this payback to the federal treasury.

“Without changing the mechanism for figuring the payments, it will hit all businesses of the commonwealth in a big way with huge tax increases the first of next calendar year,” Rudy warns.

Figure this into a budget equation that includes pension debt action and, Rudy says, “We have a whole bunch of issues we’ll tackle in 30 days.”

Juggling the unknowns requires crunching the numbers again and again.

This is well known by Chairman Rudy’s legislative counterpart, Chris McDaniel, R-Taylor Mill, who chairs the Senate’s budget committee.

“The biggest thing to watch are expenditures, especially the pension costs,” McDaniel said.

Kentucky faces daunting pension debt, and McDaniel has spent countless hours making sure the obligations are met. Pension costs are a growth aspect in the budget “requiring long-term discipline,” he said.

McDaniel watches the income side. “Withholdings tell the tale.

Taxes paid through withholdings foreshadow what is just ahead,” he

Sen. Chris McDaniel, a Republican from Taylor Mill, chairs the Senate Budget Committee.

said. “Same for sales taxes. If there is weakness in either, then it means trouble.”

With this in mind, he looks for numbers later this month as well as in November that “tell the tale of the whole economy,” McDaniel said.

As for his home county of Kenton and the Northern Kentucky Metro, the region’s “economic vitality is critical to the state as a whole,” he says. Infrastructure needs are significant, as is the continuous need for “competitive tax policy” to retain and grow Kentucky-based companies.

McDaniel emphasizes that it is “important to note that even with revenue shortfalls, this is not the time to explore tax increases. We have to work on the expenditure side to control and balance the budget.”

Each month Kentucky gets clearer data and sharpened needs for these three leaders to factor into the budget calculus. Thus the job of tallying, examining and balancing goes on. ■ Bob Babbage and Julie Babbage are with Babbage Cofounder, a leading government relations firm.

October 2020 59

INSURANCE AND INVESTMENTS

with other revenue sources. The Social Security Administration can provide information on what you’ve paid into the system and what you can expect to receive. It is important to know what your spouse’s benefits will be as well. Also, make sure you understand the impact that divorce or remarriage may have on benefits.

Simplifying Retirement Having an organized plan can help avoid problems down the road

BY KRISTEN WILSON, MBA

R

ETIREMENT planning can seem complex and intimidating, which explains why some people delay doing it. However, with the appropriate help from a knowledgeable financial professional, preparation can be a straightforward process that produces a sound strategy and a sense of security. To simplify your planning, consider pursuing these 10 steps: 1. Shift your viewpoint.

In retirement, you must go from accumulating wealth to providing a lifetime income stream while preserving wealth. If you accept this focus early in the retirement planning process, then you can go from being a great saver to being a great saver with a rational retirement income security plan.

2. Review your anticipated incomes needs.

Calculate all the necessary expenditures required in retirement as well as the unnecessary but desirable 60

October 2020

ones. Be inclusive so that you can gauge the scope of expenditures accurately. This is the most critical step in the process because it provides the foundation for all other financial planning.

3. Conduct a comprehensive revenue review.

Start by collecting information on any pensions you may receive.

That includes pensions paid by corporations, governments or other organizations. Know the amounts due to you and the methods of payment—and especially at what age you can begin drawing benefits.

Do the same thing for other accounts, whether they are savings or defined contribution plans, like an IRA, a 401(k), a SEP or an annuity.

4. Know your Social Security benefits.

Social Security could be an income source in retirement, so it should be included in a revenue review. Because of its complexities, Social Security calls for a level of diligence and understanding beyond that required

5. Factor in inflation’s impact.

It’s important to understand the impact long-term inflation will have on retirement investments.

Unfortunately, many people fail to include calculations for inflation in their retirement planning preparations. Even low levels of inflation can erode the buying power of the dollar. For example, 3% inflation over a 24-year period will double your income needs. So, you need to create a retirement plan that has the potential to increase your income over time.

6. Prepare for health care costs.

Good medical care is vital in retirement, and figuring the costs now ensures it will be available when needed. The average cost of health care in retirement is $4,300 annually, not including long-term care costs. A comprehensive study of medical benefits and costs should include consideration of long-term care insurance, supplemental health care insurance and a review of any medical benefits for which you may be eligible. For the latter, be sure that you understand coverage and copayments.

7. Develop a tax management strategy.

Retirees need to convert the appropriate assets to income.

Every conversion choice carries a tax implication. Wise choices can minimize taxes thus boosting income. It is important to compare your current tax bracket with the one you probably will occupy during retirement.

8. Understand market volatility.

All markets, including those for stocks and bonds, rise and fall due lanereport.com

to a variety of circumstances. An individual’s ability to tolerate these changes will have a huge impact on the composition of his or her retirement portfolio. Recognizing the inevitability of market fluctuations (and knowing your tolerance level) allows you to create a strategically balanced portfolio. That means you can tolerate the changes as they occur. Financial professionals know of many strategies that can help meet your needs and ensure a sense of security.

9. Get important documents organized.

Everybody should have some basic documents prepared, including a will, a living trust, a health care power of attorney and a financial power of attorney. These basic legal tools can ensure that inheritance matters are handled in an orderly and timely fashion. They also help loved ones make important decisions and gain

access to needed funds if you become incapacitated.

10. Review your retirement plan.

Regular meetings with your financial professional give both of you the opportunity to check that your retirement plan’s goals are being reflected in its performance. They also allow timely refinements to the plan required by major changes in your life. Annual reviews can be devoted to strategic issues, while quarterly meetings can cover tactical matters, like rebalancing portfolios. ■ Kristen Wilson], MBA is a registered representative of Lincoln Financial Securities Corporation, member SIPC, Branch Office: 3217 Summit Square Place, Suite 200, Lexington, KY 40509, offering insurance through Lincoln affiliates and other fine companies. This information should not be construed as legal or tax advice. You may want to

consult a tax advisor regarding this information as it relates to your personal circumstances. *The content of this material was provided to you

by Lincoln Financial Securities Corporation for its representatives and their clients. This article may be picked up by other publications under financial professional’s bylines.

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PHILANTHROPY

Foundation for a Healthy Kentucky Statewide organization focuses on policies and practices to improve the health of all Kentuckians

T

HE Foundation for a Healthy Kentucky is a statewide, nonprofit, nonpartisan foundation created in 2001 with a mission to address the unmet health needs of Kentuckians. President and CEO Ben Chandler, who joined the organization in 2016, and eight employees focus on advancing policies, practices and programs to improve the health of Kentuckians. Here, Chandler explains more about the organization and how it is meeting its mission.

What services do you provide?

We conduct research, lobby state and local elected officials, provide limited funding for demonstration projects, host an annual health policy forum, support education campaigns, and provide free training to expand the capacity of other nonprofits to do their work.

How did you get interested in your current career field?

As the grandson of a former Kentucky governor, I have always had an interest in serving the people of my beloved home state. Having served terms as state auditor, state attorney general, and U.S. congressman, I regularly came face to face with the quality of life and economic impacts of Kentucky’s poor health. I can see no better way to continue my service than as head of an organization that 62

October 2020

The Foundation for a Healthy Kentucky has worked hard to make young Kentuckians aware of the health hazards associated with tobacco and e-cigarettes. Here, Garrard County High School students and faculty display signage indicating that the campus is now tobacco free.

works to address the underlying causes of poor health in the commonwealth.

How have things changed since the organization was founded?

Initially, the foundation was primarily a grant-making entity that funded programs to improve the health of Kentuckians. Over the last several years, we have transitioned to become a policy advocacy organization that Ben Chandler, President brings together a wide variety of organizations and CEO that would be affected by policy change to find agreement and advocate together. We recognize that, given our annual budget from endowment earnings of about $2 million, we can “punch above our weight” by advocating for policy changes that will benefit thousands if not hundreds of thousands of Kentuckians or more.

Can you tell us about a recent project or development that makes you particularly proud?

Over the past three years, the foundation launched and has led the Coalition for a Smoke-Free Tomorrow, a diverse coalition of organizations working together to secure policies that will help reduce tobacco use and exposure to secondhand smoke and e-cigarette aerosol. The coalition has achieved major wins in each of these three years. In 2018, we were successful in securing the largest cigarette tax increase in the history of the state. Following implementation of the lanereport.com

additional tax, cigarette sales in Kentucky dropped by 36 million packs, a rate that was double the national rate, while also raising an additional $140 million in new revenue. In 2019, we were successful in urging the legislature to adopt a tobacco-free schools bill that would reduce youth exposure to tobacco products on campus. Before the bill passed, 42% of Kentucky schools had voluntarily adopted tobacco-free campus policies; since the law passed, 97% of Kentucky schools are now tobacco free.

In 2020, we led the campaign to adopt a statewide law to raise the legal age to purchase tobacco products in Kentucky from 18 to 21, in conformance with a new federal law on which we also worked with U.S. Sen. Mitch McConnell’s office. Also in 2020, we advocated for the first statewide excise tax on e-cigarettes, or vapes. The legislature adopted a bifurcated tax that imposes a $1.50 per cartridge of e-liquid on the “closed-system” e-cigarettes that currently are most popular among youth, and a tax of 15% of the wholesale price on tank-based or “open” e-cigarette systems. We are now employing this approach to policy change as we create the Kentucky Coalition for Healthy Children.

What has been your biggest challenge as an organization and how did you overcome it (prior to COVID-19)?

Our policy advocacy approach is to build coalitions by bringing together diverse stakeholders whose interests sometimes are at odds with one another and working with these organizations to come to agreement on policy measures that will benefit all of Kentucky. Many coalition partners must answer to either members or to national leadership whose interests are sometimes at odds, which can make achieving even initial agreement on the policy priorities somewhat challenging. As the legislative session unfolds and compromises inevitably occur, keeping these stakeholders informed and on board can be even more difficult. We focus on evidence-based policies and sometimes accept incremental progress when necessary to achieve success and sustain momentum.

How is your organization involved in communities across the state?

One of our goals is to help expand the ability of other nonprofit organizations working in Kentucky. To that end, we offer our annual Howard L. Bost Memorial Health Policy Forum and our Health for a Change regular workshop and webinar training series free of charge. These programs bring in state and national experts to share research, practices and case studies that Kentucky nonprofits, policymakers and others can employ to improve Kentuckians’ health. We also create and distribute free public health messaging about such issues as immunizations, youth vaping and COVID-19 prevention measures. In addition, about six years ago, the foundation launched a low-cost co-working space, called

lanereport.com

“(c)Space” in Louisville for small nonprofit organizations so that they can benefit from collaboration, shared resources and free or low-cost office, meeting and event space.

What’s one thing about your organization that everyone should know?

Kentucky must focus on improving the health of its residents to advance our economy and raise our quality of life. We have some of the worst health statistics in the nation—Kentucky leads the nation in cancer, for example, and we have some of the highest rates of diabetes, obesity and heart disease. Our poor health limits our ability to attract and retain jobs and talent. We must lower the barriers to achieving better health by reducing the number of Kentuckians who lack health insurance, focusing special attention on populations that experience disparate health issues and creating conditions that make healthier choices easier and more accessible.

Is there anything else you’d like to tell us about your organization?

There are so many health issues that deserve attention but, as a relatively small organization, we must limit our focus. Our current focus areas are: tobacco-use reduction, preventing diabetes and obesity, reducing and mitigating adverse childhood experiences (ACEs), and improving access to care.

If you are doing work in Kentucky in these areas and we are not currently working with you, we’d like to connect. Visit us at healthy-ky.org or call us at (877) 326-2583.

What needs does your organization currently have?

The foundation is looking to expand membership on its Community Advisory Council, our liaison with Kentucky communities. We are particularly interested in attracting individuals from the following Area Development Districts with an interest in improving Kentuckians’ health: Buffalo Trace, FIVECO, Gateway and Cumberland Valley.

What do you think will be the long-term effects of the changes made during COVID-19 on your organization?

While we value Foundation for a Healthy Kentucky in-person contact, Ben Chandler, president/CEO we expect that 1640 Lyndon Farm Court, Suite 100 working remotely Louisville, KY 40223 will become more (877) 326-2583 routine to protect healthy-ky.org against or limit future outbreaks of the virus. For our health care system, there is still much to learn, but we are working to ensure that telehealth is more available to Kentuckians who already struggled with getting to recommended preventive care and treatment for illness or injury when necessary.

Many Kentuckians have lost their jobs and a portion of those jobs may not return. For those whose health insurance is tied to employment, that creates a major access-to-health-care issue. We will continue our focus on advocating for policies and programs that will reduce the rate of uninsured and lower barriers, including cost and transportation, to health care. ■ October 2020 63

SMALL BUSINESS SNAPSHOT Members of the Wrigley Media team shoot videos on location and in the company’s 2,400-s.f., sound-proofed production studio in Lexington.

Wrigley Media Group Lexington production company thrives thrives on collaboration and creativity

BY LORIE HAILEY

W

HAT started as a video production company in 1993 has evolved into a full-service media company that conceives, creates, produces and distributes all forms of media content under one roof. Lexington-based Wrigley Media Group, formerly called Post Time Video, offers clients a broad range of services, including creative development, copywriting, video production, aerial videography, post-production editing, computer-generated animation, visual effects, Wrigley Media Group 804 Newtown Circle branded content, digital Lexington marketing and livestreaming.

(859) 266-3776 Wrigley has clients wrigleymediagroup.com throughout the world, with recent projects including media productions for Lexmark, The Jockey Club, Tony’s, University of Kentucky Athletics, the Northern Kentucky Convention and Visitors’ Bureau, the U.S. Polo Association, Shake Shack, Buffalo Trace, Breeders’ Cup and many more.

“We’re not focused on just one aspect of production,” said David Cottingham, chief business officer. “We don’t 64

October 2020

just shoot, or only edit, or just animate, or just produce; we do all of these things and more.”

Owned by Misdee Wrigley Miller and led by an experienced, media-savvy team, Wrigley Media Group has 32 employees. Cottingham, a 19-year veteran of the company, shares more of Wrigley’s story below.

David Cottingham

How have things changed in your field since you first opened?

Technology is the most impactful change in our industry every year. Whether it’s a new camera, new software,

Wrigley Media Group shot a commercial on-location for private aviation company Sentient Jet. The company recently produced videos for Tony’s, Lexmark, Northern Kentucky CVB, Shake Shack, U.S. Polo Association and more.

lanereport.com

or faster ways to render, we’re constantly updating our equipment to make sure we provide the best quality for our clients and ensure projects run smoothly and efficiently.

What is one of your favorite recent projects?

My favorite project in the last year has been the Tony’s Restaurant commercial we produced. The full version is over a minute in length and was achieved in one shot.

When you watch it, you don’t get the full sense of what it took to make the commercial. It took 10 hours to set the lights, a couple of hours to rehearse, and several takes to get it right. The commercial is so well done and we’ve won many awards for it.

What has been your biggest challenge (prior to COVID-19) and how did you overcome it?

The biggest challenge has been adapting and conforming to the production industry. Early in my career, we were very dependent on advertising agencies utilizing our production services for their clients. As we built these partnerships over the years, we felt we needed to explore other revenue opportunities. We began to work with companies on their internal videos such as training, safety, loss prevention and employee announcements. As we continued to produce these types of videos, we became a more self-sustained company.

How is your company involved in the community?

We help nonprofit organizations with their video and marketing needs.

We assist with the outreach for economic development, specifically within the film industry, as we’ve been [promoting] the education Jayne Hancock, CEO of Wrigley Media Group, died of the benefits of a Kentucky Sept. 2 in her Lexington film tax incentive. We have home. She had been with also hosted many networking the company since 2016. events within our building and Hancock was a “day-to-day studio on Newtown Circle. force in driving the vision and mission of Wrigley Media We enjoy these events as it Group. She worked quickly, gives visitors an inside look and constantly drove the at our business, our culture team forward,” said Wrigley and our people. In addition, owner Misdee Wrigley Miller. several of our employees are involved with various boards, committees and nonprofits within the community. This is something that we, as a company, strongly encourage, allowing employees paid volunteer days every year.

What’s one thing about your company that everyone should know?

We’re a family. The production industry relies heavily on teamwork and collaboration. When everyone is on the same page, production runs smoother and it kicks the

lanereport.com

Five video projects created by Wrigley Media Group received awards from the Telly Awards and Hermes Creative Awards. The Telly Awards annually showcase the best work created within television and across all video platforms.

quality up a notch. We apply our core values of quality, initiative, accountability, creativity, inclusiveness and communication to our client relationships. We are here to help clients accomplish their goals and we want them to feel like they’re part of the Wrigley Media family from the start.

In what ways has COVID-19 affected your business?

Fortunately, COVID-19 hasn’t seriously affected our business. It has made us adapt in different ways to get our work done, however. Luckily, adaptation is one of our strongest assets. During this time, we’ve been able to focus on presenting more edit-based concepts to clients who are unable or hesitant about filming. With the use of our b-roll library, stock footage, and our graphic design and animation services, we can still produce high-quality videos that convey the message of our clients. COVID-19 hasn’t changed our quality, it has just encouraged us to ideate new approaches, while maintaining the same effectiveness and efficiency.

Is there anything else you’d like to tell us about your company?

We thrive on collaborating with our clients. We want to be challenged to consistently try new ways to tell stories.

Our group of creatives brings diverse ideas and unique strategies to our projects, which keeps our concepts fresh and current every time. ■ Lorie Hailey is special publications editor for The Lane Report.

Send recommendations for Small Business Snapshot to lorie@lanereport.com.

October 2020 65

DIVERSITY & INCLUSION

Interapt’s tuition-free program combines technical training with on-the-job apprenticeships to provide underemployed and unemployed individuals an opportunity to launch promising tech careers.

Photo courtesy of Interapt

residents. As the firm grew, however, Interapt found it increasingly difficult to find and keep talented employees in Kentucky, Gopal said.

In 2015, he decided to do something about it.

“We decided to start a training program for non-traditional majors and displaced workers that wanted to live/work in Kentucky to learn tech,” Gopal said.

As the program developed, he witnessed segments within the Louisville community “that needed an opportunity to redefine themselves,” he said.

Gopal decided to offer his workforce training program tuition-free to “those traditionally marginalized by society.”

The program combines paid immersive technical training with on-the-job apprenticeships to provide underemployed and unemployed individuals an opportunity to launch promising careers in tech. It also helps businesses develop a more robust and diverse talent pipeline.

The training is offered through partnerships with local philanthropic organizations and companies. Students gain experience with different programming languages such as HTML, CSS and JavaScript, then participate in customized training modules with partner companies. Interapt also helps participants develop problem-solving skills. They teach them how to quickly learn and retain information, important skills in the ever-changing technology landscape.

“The first stage of bringing transformational change is to provide a vision and then a path to get there,” Gopal said. “Hope quickly replaces despair and people bring about change to their family and then their community.”

Interapt has trained people from all walks of life, Gopal said, “from the self-taught coder who just needed some refinement to the person working at the drive-thru at a local fast food restaurant.” Some participants have had very little computer experience, but they had the aptitude for the work.

“We believe the person with the aptitude to be in the tech sector can come from any kind of past or career,” he said.

“We have seen our program work in rural and urban settings, with participants with very diverse backgrounds. If someone likes to learn and challenge themselves while retaining information to apply to problem-solving opportunities, then they will flourish in our training programs.”

Helping traditionally marginalized individuals—often those with low-income jobs and minorities—became a

Changing Lives One Line of Code at a Time Interapt invests in potential, trains marginalized individuals for high-tech careers

BY LORIE HAILEY

L

AST year, Louisville resident LoLa Randall was working various shifts at Churchill Downs to provide for her family. Now she is an IT support analyst working on a project with a national health care provider.

Her story, while remarkable, is not unique, thanks to Interapt, a Louisville tech company that is “changing lives one line of code at a time.”

“Because of Interapt, I have access to a completely new world,” Randall said.

Ankur Gopal started Interapt as a mobile and web application development firm in 2011. His vision was to create a high-tech company and create jobs for Kentucky 66

October 2020

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Photo courtesy of Int

personal mission. As the creator of a successful hightech company, Gopal has been asked to speak at several prominent technology conferences. He has encountered many people at those events who were amazed he chose to operate his tech company in Kentucky.

“Some even felt sorry for me and offered to use their networks to ‘help me relocate back to Silicon Valley.’ Some had a very deep bias against non-traditional tech states and believed finding talent in Kentucky was a fool’s errand,” Gopal said. “This reminded me of my own upbringing when others marginalized me and prevented me from opportunities for having brown skin ... But this time, it wasn’t racial bias, but geographical bias, which I wanted to do something about.”

Interapt partners with like-minded companies who are interested in transforming their social impact while increasing their bottom lines, such as Humana, Kindred, Accenture, Chase and Netsmart.

In 2019, Interapt teamed up with General Assembly (GA), a pioneer in education and career transformation with more than 30 campuses and over 19,000 hiring partners, to expand its business model and “play a bigger role in fostering a more diverse and inclusive technology ecosystem throughout America,” Gopal said. Interapt also helped develop one of the first IT Registered Apprenticeship Program models with the U.S. Department of Labor and has partnered with local universities such as the University of Louisville to provide additional stackable credentials for students who are interested in filling today’s IT skills gap.

“There are over 700,000 open tech jobs in the U.S, but many of them are left unfilled because workers are unable to receive the kind of tech training or career services that are required to be successful in today’s digitally driven workforce,” said Jake Schwartz, GA’s cofounder and CEO. “Interapt has done a fantastic job at addressing

LoLa Randall, shown here with her daughter during a virtual learning session, completed Interapt’s training program in 2019 and became an IT support analyst working on a project with a national health care provider. Before the program, she was working various shifts at Churchill Downs to provide for her family. “Because of Interapt, I have access to a completely new world,” she said.

this, creating an innovative model for training that has worked far beyond Silicon Valley, first in Louisville and now throughout the region.”

In May 2020, the Kentucky Economic Development Finance Authority approved Interapt for economic incentives to establish its national headquarters in downtown Louisville with satellite operations around the country.

“We now have around 200 employees across 25 states and we expect to hire an additional 40-50 by end of the year,” Gopal said. “COVID-19 has made U.S. firms rethink their technology strategies, and as a result has created opportunities for us to leverage our training programs to reshore our partners’ technology workforce from around the globe. We are mitigating our partner’s risks while creating opportunities for tech workers that begins right here in Kentucky.” ■ Lorie Hailey is special publications editor for The Lane Report.

Send recommendations for Small Business Snapshot to lorie@lanereport.com.

Why should all businesses be thinking about diversity and inclusion?

H

AVING a workforce with strong gender and racial representation is essential to an organization’s growth. A 2015 study by McKinsey & Co. found that companies with more gender and ethnic diversity perform better financially—an average of 35% greater.

Companies in the top quartile of gender diversity were 15% more likely to have financial returns that were above their national industry median, while companies in the top quartile of racial/ethnic diversity were 35% more likely to have higher financial returns, the study found.

More diverse companies are better able to win top talent, improve their customer orientation, employee satisfaction and decision making, leading to a virtuous cycle of increasing returns, the Diversity Matters study found.

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“That in turn suggests that diversity beyond gender and ethnicity/race (such as diversity in age and sexual orientation) as well diversity of experience (such as a global mindset and cultural fluency) are also likely to bring some level of competitive advantage for firms that are able to attract and retain such diverse talent,” the study leaders said.

For Interapt, having a more diverse team means a broader scope of solutions to their clients’ problems, Interapt’s Ankur Gopal said.

“We’re a solutions-based company, and when we are tasked to give detailed solutions to our clients’ technology problems, a diverse team with different trains of thought will provide the best collective answer. These diverse experiences bring a lot of solutions,” he said.

A company’s focus on diversity and inclusion—or lack thereof—affects its ability to recruit and retain talented employees. The modern workforce is less interested in climbing the corporate ladder and more interested in working for companies with a conscience that are making a social impact, Gopal said.

“We have extremely talented members of our team that could be working for any company in the U.S. but choose to work for Interapt due to our social impact and vision of diversity and inclusion in the tech world,” he said.

Companies that want to develop a more diverse, inclusive culture should first identify companies or organizations that have done it well and learn from them, Gopal advised. Ask for guidance, create a plan with clear goals and outcomes, and hold your team accountable, he said.

“And don’t be fearful of getting it wrong, as long as you are sincere in your attempts,” Gopal said.

October 2020 67

MARKETING

Know Your Audience How to make your company’s marketing more diverse and inclusive

BY GATHAN BORDEN

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MAGINE you’re a marketer looking for an image. You search the internet for “people having a meeting.” You now begin to scan the image…

• Women? Check.

• Men? Check.

• African Americans? Yes, or at least they look African American.

• Whites? Yes. • Other minorities? Maybe this lady can pass for another ethnicity.

• Young people? Yes. • Middle-age or seniors? Maybe this man can pass for both.

These are just some of the thoughts that go through a marketer’s mind when trying to choose images that are diverse and inclusive. Given all of the issues our society is currently facing, there has been a renewed push to shine a light on the lack of diversity and inclusion from organizations in their advertising and marketing efforts.

Let’s first talk about the difference between diversity and inclusion. Even though diversity and inclusion go hand in hand, they’re two different things.

Diversity refers to the variations of different characteristics within a 68

October 2020

group of people. These characteristics are everything that makes us unique, such as skills, personality traits, and other things that shape our identity like race, age, gender, religion, sexual orientation and cultural background.

Inclusion ensures that all individuals are treated fairly and respectfully, have equal access to opportunities and resources, and can contribute fully to the organization’s success.

One of the best analogies told to me was, “Diversity is inviting you to the table, inclusion is offering you something to eat.”

There is an Islamic proverb that says, “A lot of different flowers make a bouquet.” Organizations that invest in diversity and inclusion initiatives tend to outperform their competitors in terms of sales, profitability, employee performance and employee morale. Diversity leads to greater innovation by creating an environment where ‘out-of-the-box’ ideas are heard, and in a time when hiring and holding on to staff is a challenge, diversity makes it easier to recruit and retain top-tier talent.

Just like diversity initiatives, inclusion initiatives have similar

positive impacts on an organization.

Creating a culture of inclusion produces a happier and more stress-free work environment, and studies show that positive work environments lead to greater success, because happier employees are more productive and engaged.

When employees feel valued and respected, it leads to greater collaboration and creativity, and that leads directly to better job performance. When employees can acknowledge and respect diversity, they have a greater opportunity to attract and retain diverse customers, build better rapport with them and increase customer satisfaction.

Diversity and inclusion are not just about the internal works of an organization, but about the external relationships and visuals used to sell products and services. Research shows that customers respond to diversity and want to see more of it in marketing. In 2019, Adobe conducted a research report of more than 2,000 consumers and 38% of consumers were more likely to trust brands that do well with showing diversity in their ads. Oftentimes, brands miss the mark and put forth stereotypes, superficiality, tone deafness, and cultural insensitivity in many ad campaigns. When we look at younger generations, many millennials believe that businesses have a responsibility lanereport.com

and a duty toward addressing wider social and political issues with regard to diversity. They also are more likely to choose one brand over another if that brand demonstrates diversity and inclusion in their promotions and offers, as well as in their in-store experiences.

Being more diverse and inclusive is not easy, but it is also not as daunting a task as it sounds. Here are three ways to make your company’s marketing more diverse and inclusive: Look inside and link outside.

Having more diverse and inclusive marketing starts inside the organization. In order to serve diverse customers, you must first understand what it means to be diverse and inclusive. Brands tend to focus more on their external approach through visuals and other creative assets, but the real work starts at home. Assess your staff to see if they are reflective of the community in which you are located. Conduct cultural competency surveys and cultural bias trainings.

Use your internal assessments and trainings to make connections with external groups in your industry that can help you expand and grow your diversity and inclusion work.

Research your customer.

All brands should respect everybody but being inclusive in your marketing

doesn’t mean you have to address the groups of people who have no connection to your company’s products or services. Aside from the surface-level data of race, gender and other demographics, talk with frontline staff, attend industry events and conduct focus groups to gain a full understanding of your customer.

Allow the data to make your marketing decisions transparent.

Don’t force the narrative.

Earlier in the article, I reference that stock photo we’ve all seen. It has every race, every sex and every age all in a conference room together, and none of it looks real or natural.

Brands often make the mistake of taking the easy way out and using stock images to sell products and services, and the people used in those images look nothing like their staff or customers. Truth is, we choose friends who are similar to us in race, gender, age, background and attitudes—a

psychological phenomenon known as homophily. While customer bases are quite diverse, the customer who shares your product or service with others is quite homogenous in nature.

Take that into account when creating visual assets of customers experiencing your product or service.

Pushing for more diversity and inclusion in your marketing is not something that can be fixed overnight.

It requires true introspection from the organization by looking at your policies, your staff, your customers and your creative assets. If you don’t have the resources internally, reach out to your external professional networks for assistance and advice. Invite others in to be a part of process. Jesse Jackson said, “when everyone is included, everyone wins,” and that is goal. ■ Gathan Borden is vice president of marketing for VisitLEX, the Lexington Convention & Visitors Bureau

>> COVID-19 WUKY is your ESSENTIAL source for trustworthy, local and national news coverage, as well as your daily source for musical discovery through its wide array of programs.

Let us take you on a journey!

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Web: kycovid19.ky.gov Info Hotline: (800) 722-5725 Price Gouging Hotline: (888) 432-9257 Twitter Hashtags: #TeamKentucky #TogetherKY

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Listen to 91.3 and stream WUKY for local and NPR updates on the latest.

October 2020 69

THE HR MANAGER

Navigating the Search Process How to make your resume stand out in a sea of applicants

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HIS year has produced a tremendous upheaval in the job market as companies around the world shift and adapt to the changes produced by a global pandemic.

Here Lexington human resources expert Karen Hawkins offers her advice to those searching for a new job.

What have you found to be the best job search sites?

LinkedIn and Indeed tend to be the most used sites currently. Keep your LinkedIn profile updated and robust in case a recruiter may find you while searching for candidates. Believe it or not, jobs can just land in your lap if you have your information available.

Should I link up with a recruiter?

It’s a great idea to keep your options open, especially in these uncertain times. As a recruiter, I’m always happy to keep a person’s information in my recruiting database.

When reaching out to a recruiter, express what type of position you are seeking – either lateral or upward movement, a targeted industry or geographic area, and a general idea of salary expectations. This information helps recruiters categorize you for future needs.

How can I spruce up my resume?

Resumes are your calling card…in a sea of calling cards.

Here are some resume pointers: • Add a slight amount of color to your resume – either on your name, the headings or section markers.

• Include your LinkedIn profile link.

• Listing of your “Objective” is now passé. Recruiters and hiring managers want to see an executive summary of your experience at the top. For example, under your 70

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name/address/contact info, have a few bullets along with one “capture sentence”: “HR manager with 15 years’ experience in automotive and health care industries, including union and non-union environments.” Then list bullets with your top strengths.

• Resumes DO NOT need to be contained to one page!

This is no longer the rule of thumb. Concise but pertinent information is always welcome.

• List a brief explanation of what each of your employers does. For example: MetalLine, manufacturer of aluminum wheels. This helps us understand what the environment and products are where you’ve worked. Otherwise, we have to research that information or make a guess.

• List several strong accomplishments with each position you’ve held. When possible, these accomplishments should include data points. Employers want to see what you’ve done for your past employers and what you can do for them. This is like listing your return on investment!

Are there any key words that employers want to see?

Key words included in resumes should reflect those listed in the job description. Not everyone has time to customize a resume for every job posting but it really can help. If you know there are consistent key words listed in most job ads, I would certainly use those often. I also like to see positive wording that shows energy and collaboration.

Don’t overuse buzzwords, as those can be a quick turn-off.

I have heard of software that automatically declines a resume. Can you talk about that?

There are some companies that recruit high volumes of employees. Some applicant tracking programs may look for key words and if they don’t see them, resumes could be rejected. However, I would expect those key words to be crucial and highly likely listed in your resume. For example, if a person is applying for a professor position and must hold a master’s degree, then applicants should have that listed. If not, a person may not be qualified. The large majority of employers are likely not using this type of software.

Should I pay a recruiter?

The employer typically pays recruiters and the candidate typically pays outplacement Karen firms/career coaches. A recruiter will Hawkins is not typically charge a candidate since the owner of Hawkins HR the recruiter is usually working on the Consulting company’s behalf to fill the position. LLC. However, there are outplacement firms or career coaching services that search for positions on the candidate’s behalf or they help direct the person how to find a job. These agencies can be very helpful, especially if the person feels “stuck” in his/her search. Or, in some cases, if a candidate has been terminated from a position, it may be helpful to have someone help finesse his/her way through some difficult conversations while interviewing.

I believe these firms can be great accountability coaches, which is sometimes all a person needs to stay on track. ■ lanereport.com

CYBERSECURITY

Don’t Be Phish Food Expert advice on how to protect yourself from email scams

BY TRACY HARDIN

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Y email subjects tempt with, “Helps protect you from airborne particles,” “You have (4) messages pending delivery on your email portal,” “Virus Stimulus Money Update,” and, my personal favorite, “Oh, where have you been all my life?” COVID has certainly not had any impact on the quantity of phishing emails I get. In fact, it has provided fresh fodder for new scams.

My name is Tracy Hardin, and I am the president and founder of Next Century Technologies. Like all other C-level execs, I am a huge target for phishing emails. The scammers and hackers all know that the easiest way to infiltrate an organization is through its staff. I’ve seen a steady improvement on the quality and quantity of phishing emails, so I want to talk about the trends I have noticed since COVID started.

A very common phishing scam I have been seeing is a request to validate my account with my email credentials.

Here is a fine example complete with GoDaddy’s logo and a nice signature from their CEO (likely with his real signature): The goal is for you to click the link in green to validate your email address and, in doing so, hand over your password as well.

What can they do with your email password?

A lot! They will go through your email history and reply to senders to start a new conversation, which almost always revolves around paying a fake invoice.

They will also harvest all the contacts as potential victims for future email phishes. They will identify fellow employees and attempt to email them requesting gift card codes or wire transfers.

Basically, they will impersonate you and you won’t even know it!

This next example is simple and, at first glance, very appealing. Passwords expire all the time and who doesn’t want to keep their password the same?

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Good spelling, clean grammar plus a nice copyright at the bottom. Again, a great example of how easy it is to hand your email password over to a complete stranger.

So how do you protect yourself? Be a skeptic. Look hard at the FROM address. In the example above, the FROM is do_not_reply@domain.com. That’s not your company’s email address and it’s not the address of your email provider.

Criminals will also use an email address similar to a trusted company address to trick you into clicking a link or giving away confidential information. A great example in my mailbox is a fake Red Cross solicitation from donations@AmericanRedCross.mail-sender.online. Yet a quick Google search shows their domain to be RedCross. org. Sometimes the FROM is a complete spoof of a legit address like in my first example: donotreply@GoDaddy. com. Anything that asks for a password is always a big red flag and so are embedded website links.

Also, don’t forget that email passwords get compromised all the time, so even a customer asking you to click a link, change bank details or request a wire transfer should be treated with great skepticism. Your spam filter will likely fail to block these emails because they come from a legitimate source.

Another way to protect yourself is by configuring your email service to add a simple header line to all incoming emails that will help you identify external emails. Mine states, “CAUTION: This email originated from outside your organization.” This helps me identify people who try to impersonate my staff and helps my staff identify people who are trying to impersonate me.

The best way to protect yourself and your staff is through an ongoing training program that focuses on the latest scams.

The FBI reported that email compromises cost organizations $1.7 billion in 2019. Watch what you click.

Don’t be their next big catch! ■ Tracy Hardin is president and founder of Next Century Technologies.

October 2020 71

TECHNOLOGY & INNOVATION

Kentucky’s First Virtual Studio When COVID shut down the events business, MSI Production Services invested a new platform

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AM Smith learned long ago that sound and video quality can make or break an event. An audio engineer by training, his company for two decades has provided the technology muscle behind many of the state’s largest business conferences, seminars, galas and more.

Clients include major metro and statewide business organizations, large charities and churches, political organizations and campaigns, and individual politicians. In-person face-to-face skills will always be important, but connection with an audience usually requires excellent audio, video and staging.

Last spring, when the coronavirus pandemic delayed and then canceled most events, Smith had an “ah-ha” 72

October 2020

moment and ending up building Kentucky’s first virtual studio. It has kept his business in business and his clients’ events–and the cash flow they create–happening.

“I lost all of my events for the entire year,” he said.

Some of those events are key revenue streams for many operations, especially charities, which were suddenly “losing millions and millions of dollars,” Smith said. “They don’t know how to take their events virtual.”

Hospitality is the third largest economic sector in the world, and the COVID-19 pandemic shutdown had suddenly wiped it out.

Lexington-based MSI Production Services has been a top audio/video name brand since 1997 for business

MSI Video Productions of Lexington, a provider of full-service audio and video support for events in Kentucky and beyond since 1996, turned part of its warehouse space into a virtual studio after the COVID-19 pandemic closed venues across the state.

and political events in Kentucky and beyond. Although it’s a spot-work business, MSI stays booked to the extent that some of the independent contractors Smith regularly uses to work those events make six figures.

Until six months ago. The events sector largely shut down when the COVID-19 coronavirus pandemic

MSI Video Productions can broadcast externally via social media or meeting platform. It can see those watching an event and put them on screen, making them participants even if they are distantly remote. lanereport.com

The virtual studio created by MSI Video Productions has enabled nonprofits and other noncommercial organizations to conduct events that are key revenue generators for the clients and that had been canceled due to pandemic safety measures.

arrived in March. But Smith quickly began considering creating his own virtual studio.

Local television stations locked their facilities to non-employees lest an infection close their entire business down. Political office holders asked Smith how they could continue making network and cable appearances that maintained commercial polish, that looked professional.

He knew low-resolution home computer webcams, dining room lighting, microphones that warble or cut out completely, and odd backgrounds were falling short of projecting the overall images that instill confidence in an audience, whether that is one person or more than 1,000. Even a professional office can come across inadequately.

“You can’t engage your audience if you are on a crappy webcam,” Smith said.

It requires reliable high-resolution video cameras, clean setting and staging, appropriate furnishings, the correct color palettes and good lighting.

It requires quality microphones for all and a sound system with good, appropriately placed loudspeakers and monitors, and a mixer to put it together. And a video production platform that can blend, control and switch among all those streams.

A studio is a big investment.

Initially, though, no one had a dependable idea as to how long

the COVID-19 pandemic conditions might last—estimates ranged from two years, like the Spanish flu of a century earlier, to it disappearing in a few weeks. Additionally, there were big medical safety questions attached to moving forward, and social-distancing rules had not been written. Could a studio get personal protective equipment?

The finances of many business and nonbusiness entities with multimillion-dollar operations hung in the balance.

Smith watched large businesses such as theme parks and convention centers close, creating a cascade of impacts on suppliers and even on local governments, which might be counting on service fees and tax revenues of up to $100,000 for large events.

Clients from individuals to statewide organizations began coming to Smith. And since MSI could not go to the events—not an option since they weren’t happening—he brought the events to MSI. In late July and early August, Smith turned a portion of warehouse space his businesses use on Fortune Drive in east Lexington into a highquality studio that can safely conduct or support events. MSI can broadcast

internally for a client such as a business, church or charity. It can broadcast externally via social media or meeting platform. It can see those watching an event and put them on screen, making them participants even if they are distantly remote.

“We reverse-engineered being able to get into programs like Zoom, to get broadcast-quality video and audio into Skype, etc.,” he said. “I was on forums with people in our industry all over the world.”

Smith called equipment and software manufacturers to get quality patches to make the various pieces compatible. He even wrote some of the code himself after consulting a couple of engineers.

U.S. Rep. Andy Barr of Lexington was the first client to use the new virtual studio. And Smith built another one in Louisville.

Business “is picking up immensely,” Smith said, “because we have reimagined ourselves as the premier virtual studio.”

MSI already had a good brand.

“We are known for going out and doing ‘turnkey’ events,” he said, meaning they would direct and handle the planning, set-up, execution and tear-down for events.

The company is now back in operation conducting events virtually for many of its longtime clients.

They are salvaging events and salvaging revenue. “They love it,” Smith said. “If you don’t keep your brand in front of people, they will forget it.” ■

The control room for the MSI Video Productions virtual studio.

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October 2020 73

LIFESTYLE

Creating a Backyard Haven Northern Kentucky business helps clients make the most of their homes

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ITH the restrictions resulting from COVID-19, more families are retreating to their backyards for comfort and investing more in their backyards than ever before. The outdoor living space segment has been growing over the last couple of years and the virus has now put it into overdrive. The Lane Report talked with multiple landscaping and pool companies, all of which say they are booked out six months in advance with installations.

Shade structures and privacy screening are in most demand, primarily because of the feeling of seclusion they provide. Those who can go all out are installing luxuries like premium lighting, outdoor kitchens, fireplaces and comfortable seating areas.

The Lane Report recently talked with Scott Maddox, Maddox Garden Center 8430 Dixie Hwy the owner of Maddox Garden Florence, Ky. 41042 Center, a premier outdoor (859) 371-6340 and landscaping company in Florence, about his company and recent trends in the outdoor living sector.

How long has your company been in business?

I am a second generation. My father, Robert Maddox, started the company in 1982. I joined with him full time after graduating from the University of Kentucky in 1994.

What is Maddox Garden Center’s primary focus?

We mainly focus on residential landscaping for both homeowners and a few home builders in The Northern Kentucky area, and landscape supply for both home and professional landscapers. We have a 6-acre retail garden

Comfortable chairs, colorful planters and a cozy fireplace work together to create a relaxing space.

center located in Florence on part of the Maddox family farm that my grandparents worked.

What else would you want prospective customers to know?

We are a leader in landscaping design and management, and can develop a landscaping plan that fits your aesthetic needs and your budget. No project is too big, and we will work with you every step of the way. Our designer Rodney Crice can answer your design questions.

What sort of trends are you seeing during the pandemic?

A lot of folks are pursuing smaller projects or projects that have been put on hold over the years. People are spending more time at home and trying to improve their outdoor spaces. We are not seeing a lot of larger projects and I presume this is due to uncertainty associated with the COVID-19 issue.

If someone wanted to start an outdoor kitchen, what would you recommend?

I would tell them to evaluate how much they anticipate using it. What are your cooking habits? Do you entertain

Firepits have become a popular addition to outdoor living spaces.

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Stamped concrete provides attractive color and texture to outdoor spaces.

a lot? If it is going to be used as an outdoor room, your budget should be comparable to a room addition to your home. Built-in outdoor grill stations are not cheap, and the more appliances you want, the more it will cost. Also, if there is not enough space for your dream kitchen, you must factor that in as well.

Speaking of concrete, what is stamped concrete?

That is when we pour concrete and while it is wet, we stamp it with a pattern and add color, so it looks more like pavers or stone.

In your opinion, what is a must-have for outdoor living?

A usable outdoor space that fits your lifestyle and budget. â–

What are the essentials and set-up needed for a kitchen workspace?

Space and access for construction are essential. An outdoor grill station will most likely need a concrete footing and utilities such as electric, plumbing, data, gas and lighting installed.

Other than kitchens, what else have people been requesting?

Mostly outdoor living spaces with fire pits or fireplaces; a space in which homeowners can relax and entertain close friends and family. In addition, landscaping, such as trees and high bushes. Each provides privacy and is almost always requested by the customer.

Is it better to go with pavers or concrete for your patio?

We prefer pavers as they offer more options for color, texture and finish. We suggest concrete for folks with limited budgets.

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Having an outdoor kitchen is essentially like having another room in your house.

October 2020 75

EMERGING LANE

The Spartan Garage is an automotive customization shop that specializes in three different categories: street, general services and off-road.

Revved Up to Grow Robert Bowden’s business acumen has shifted his young auto services company into high gear

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OWLING Green, Kentucky, has developed a reputation as a place where people know cars.

After all, it holds the distinction of being the only place in the world to produce the iconic Chevrolet Corvette and people who love cars come from all over to visit the National Corvette Museum and take plant tours. So where better for The Spartan Garage, a high-end wheel, tire, suspension and accessories shop, to set up shop?

The Spartan Garage was first started in 2015 by Robert Bowden III in his parents’ Atlanta garage and specialized in aftermarket modifications of off-road vehicles.

When Bowden enrolled at Western Kentucky University for college, he relocated his company—then called Spartan 4x4—and added two students as employees. While in WKU’s Student Business Accelerator program, Bowden and his team expanded their network in the southern Kentucky automotive community.

By July 2019, Spartan 4x4 had relocated to a 6,000-s.f. facility in the Bowling Green Corporate Park and that fall, Bowden founded Spartech Performance Robert Bowden III, to meet the demands of Founder, sport and performance The Spartan vehicles in the area. Garage In early 2020, Bowden merged Spartan 4x4 and Spartech Performance to create The Spartan Garage (TSG).

Now, TSG is building a new stateof-the-art 7,600-s.f. retail and service facility on Lovers Lane in Bowling Green to service the street, general

services and off-road markets in the south-central Kentucky area. The company currently operates with a staff of six and Bowden said more jobs will be added once TSG moves to the larger location.

The new facility will include a modern showroom and feature sophisticated equipment to maximize efficiency while servicing a diverse range of vehicles.

“We are proud to invest in the Bowling Green area and to be a part of its long history in the automotive industry,” said Bowden, who was recently nominated for the Bowling Green Area Chamber of Commerce’s 2020 Small Business Person of the Year award. “This is an ideal location for our company, and we have aggressive plans to grow our team in Bowling Green.”

“TSG is a great success story of a young entrepreneur and his team driving forward with an amazing work ethic and exacting standards that deliver an exceptional service to a growing customer base,” said Bowling Green Area Chamber of Commerce President and CEO Ron Bunch. “The company reaffirms the level of opportunity and wonderful business climate in Bowling Green— especially for companies looking to become part of our strong automotive ecosystem.” ■

TSG’s off-road services include everything from suspensions and wheels to paint and lighting.

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SPOTLIGHT ON THE ARTS

COVID Can’t Stop Creativity Paducah artists use their artistic talents to help others

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OR the past 20 years, Paducah artists Michael and Victoria Terra have been making a living selling Michael’s artwork at juried art shows and festivals across the nation. So what does a creative couple do while sheltering in place? They just keep on being creative, of course!

“We’re constantly thinking of creative ways to keep our business afloat and to contribute to our community,” says the energetic couple, who own Terra Cottage Ceramics. “We started with a fundraiser for our local Small

Michael Terra created the “Socially Responsible Squints”—wall hangings that depict small masked faces—to help raise money for small businesses in the Paducah area affected by the COVID-19 pandemic.

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Business Relief Fund selling Socially Responsible Squints (small masked faces that are used as wall hangings).

That fundraiser turned out to be rewarding and successful, so they felt it was time to expand their reach.

Michael, a poet and sculptor, designed a ceramic outdoor wall tile that says ‘HumanKind: be both’.

“There is a bit of philosophy behind this seemingly simple phrase,” he explains. “We are all human and we are all kind and if we simply do both of those things–be human and be kind–then so many issues will simply melt away. It took months of studio time to work out all of the kinks and issues that come with dealing with the production of large outdoor tiles but they are now ready to be hung everywhere!”

Terra Cottage Ceramics has decided to contribute the proceeds of the HumanKind fundraiser to Doctors Without Borders.

The HumanKind wall tile sells for $150 at terracottageceramics. com, with $50 of each person going to Doctors Without Borders. Sales include shipping and come with the necessary hardware for installation. ■

Above: Paducah artist Michael Terra has become known as the “Mud Poet” for his work that often combines words and clay.

His wife, Victoria—otherwise known as the Logistics Goddess—oversees the business side of things.

Below: A portion of the proceeds from the sale of the “HumanKind” outdoor wall tiles goes to support Doctors Without Borders.

Michael Terra describes his “Reading Glasses” as “a delicious micro-puzzle for your brain as you decipher the meaning on each vessel.”

October 2020 77

EXPLORING KENTUCKY

Left: Coppin’s Restaurant & Bar at Hotel Covington features a lovely patio for outdoor dining.

Below: Brick-oven pizzas are a specialty at The Gruff, with toppings such as smoked brisket, truffle sausage, and bacon and apple.

A Taste of Northern Kentucky A guide to sipping and dinning al fresco in NKY

BY KATHERINE TANDY BROWN

If you’re itching to get out of the house, head up to Northern Kentucky (NKY), where new attractions, experiences and eateries are popping up across the region to enhance the area’s tried-and-true visitor favorites.

“You can go far in our destination,” says Julie Kirkpatrick, interim president and CEO of meetNKY, the area’s new brand for the former Northern Kentucky Convention and Visitors Bureau. “You can visit Germany in Mainstrasse Village, take a historic walking tour of Newport’s gangster history, or get outside on one of Devou Park’s great bike trails.”

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Not to mention ogling octopi at the Newport Aquarium, strolling through Covington’s history via the beautifully rendered art of the Roebling Murals on the Floodwall and the BehringerCrawford Museum, and meandering down the Ohio River on a private, three-hour Grillout Cruise.

After you’ve “touristed,” where do you head to wet your whistle and satisfy your hunger? Easy answer: the B-Line, Braxton Brewing Co., and any of the area’s fabulous al fresco eating spots.

According to The Bourbon Review, NKY is home to some of the best bourbon bars in the country. The B-Line is the Bourbon Line, where

you can learn all about bourbon making and can enjoy tastings at four Kentucky Bourbon Craft Tour Distilleries: New Riff Distilling, Boone County Distilling Co., Neeley Family Distillery, and the Old Pogue Distillery. The B-Line also features six bourbon-centric bars, and five restaurants with a remarkable selection of bourbons and bourboninfused culinary delights. Learn more at findyoursippingpoint.com.

Braxton Brewing in Covington has a diehard local following of its handcrafted beers and an outdoor space, The Rooftop, to sip the suds.

Offerings include year-round and seasonal faves, limited releases, specialty beers, and Braxton Labs exclusives, plus hard seltzers and hard ciders.

As for NKY’s outdoor dining scene, the choices are abundant.

Occupying a kitschy building that was once a 1930s garage and filling station in Covington, The Standard opened in July. And while it may be fresh on the scene, dynamic owners and MainStrasse Village residents Paul Weckman and Emily Wolff already have three winners in their stable of successful restaurants. lanereport.com

In Mainstrasse, Otto’s has been serving American and Southerninspired fare since 2003—think fried green tomatoes and shrimp and grits—and Frida 602 is a tequila and mezcal bar that offers scrumptious Latin street cuisine. Completing the trio is Larry’s, a homey dive bar that opened last year on Covington’s Ninth Street, serving up hot dogs and tater tots, pinball and pool.

All of the culinary couple’s properties serve luscious creations in outdoor spaces and the Standard is no exception. Patron favorites include Banh mi, a short baguette with a thin, crisp crust and soft, airy innards, split lengthwise and stuffed with a savory filling, such as Vietnamese meats and vegetables. Murals here depict stories of the former auto shop.

Mentioning goetta is required in a story about food in the vicinity of Mainstrasse, and Covington’s The Gruff—as in the fairy tale Three Billy Goats Gruff—features a Goetta

Cubano on its brunch menu. The German meat-and-grain sausage was originally used to stretch a family budget, but has become popular on plenty of Cincinnati and NKY menus.

Coppin’s Restaurant & Bar at Hotel Covington, transformed from the original Coppin’s Department Store, is a pet-friendly stop with an outdoor patio on the B-Line that features curated cocktails and locally sourced food. Arrive on “Thrifty Thirsty Thursday” and score a $5 craft cocktail or a $3 pour. Call ahead for movie nights and a live music schedule.

The Knotty Pine on the Bayou has been cooking Cajun for 25 years on the Licking River, just 12 miles southeast of Covington. Oysters, shrimp, frog legs, catfish, red beans and rice, gumbo, etouffee…even alligator. Landlubbers can stick to filet mignon or chicken. Whatever you order, the outside river views are lovely.

Otto’s has been a popular dining spot in the Mainstrasse area since 2003, offering American and Southern-inspired fare.

Learn more about NKY at meetNKY.com or call (877) 6598474. By all means, call before you go anywhere, as COVID may have changed a few schedules. ■ Katherine Tandy Brown is a correspondent for The Lane Report. She can be reached at editorial@lanereport.com.

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October 2020 79

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Lane Report 35th Anniversary Kentucky’s most relied upon statewide business news magazine is old enough to run for president. The Lane Report magazine is 35 years old and hitting important milestones. We have new ownership, Lexington business executive Kevin Stinnett, and last month moved into new offices.

Health Kentucky Along with a feature article on the Kentucky Health Collaborative, the annual special publication Health Kentucky will be included with the November issue.

It is an opportunity for major health care providers in Kentucky to highlight new services or present special insight into their story in their own words.

Wealth Management Kentucky continues to attract wealth management operations because the sector is growing. The assets built by the baby boomer generation continue to be cashed out and transferred to younger generations, who often prefer advice from someone their own age.

Accounting Firms We look at the latest trends in Kentucky accounting that have been growing and diversifying service offerings to business clients for some years now. Trends feature lots of new technology, with a focus on consulting services to clients’ performance and expertise in keeping business data safe from cyberattacks.

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October 2020

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Join KET for 2020 Election Coverage TUNE IN OR STREAM

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PBS NewsHour Debates 2020: The Presidential Debate

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