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Focus On Signal Hill

Looking east from Cherry Avenue, the community of Promontory West bluff is in the foreground, Hilltop Park in the center and the Promontory community at the top of the hill. (Photograph by the Business Journal’s Thomas McConville)

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FOCUS ON SIGNAL HILL 2-B Long Beach Business Journal

June 10-23, 2014

Signal Hill Balances Budget, Strives To Move Past Development Difficulties ■ By SAMANTHA MEHLINGER Staff Writer ith small surpluses expected in the W next two fiscal years, $11 million in rainy day reserves and another $6 million in reserves for anticipated future costs and projects, the City of Signal Hill – which turned 90 this year – remains on stable financial footing. Upcoming uncertainties somewhat cloud the crystal ball when it comes to the city’s future, however: increasing costs related to California Public Employment Retirement System (CalPERS) pensions and water regulations may prove a strain on the budget, and future real estate developments are in question due to state-imposed roadblocks. Although a budget surplus is anticipated next year, Signal Hill City Manager Ken Farfsing noted that it is small, at an estimated $151,506. According to a budget presentation prepared by city staff, Signal Hill has had a surplus for 13 of the past 15 years, with the two outlying years occurring during the Great Recession. Typically the city runs a surplus because while full staffing is budgeted for, “we are almost never at full staffing,” he explained. The anticipated surplus for next year is smaller than usual because the city is now budgeting for “some long overdue upgrades to facilities,” such as painting city hall. These improvements were postponed for fiscal conservancy during the recession years, Farfsing said. The total budgeted expenses for the 2014-2015 fiscal year, which runs from July to June, are $18,969,513, according to information provided by Terri Marsh, finance director and administrative services officer for Signal Hill. Eighty-three percent of the city’s revenues are derived from taxes. Of the $19,121,019 in revenue expected next fiscal year, $12,275,662 is from the sales and use tax, which relies upon the city’s base of businesses such as auto dealers and retailers. The next largest revenue producer is oil production taxes, which are expected to generate $1.2 million in the 2014-15 fiscal year and $1.3 million the following year. Upcoming challenges may put a strain on the budget, Farfsing pointed out. “All cities are dealing with the pension increases. . . . We know that that is going to have some

The five-member Signal Hill City Council is pictured in front of city hall with City Manager Ken Farfsing, second from left, and Deputy City Manager Charlie Honeycutt, second from right. The elected representatives are, from left: Vice Mayor Larry Forester; Councilmember Lori Woods; Mayor Ed Wilson; Councilmember Michael Noll and Councilmember Tina Hansen. (Photograph by the Business Journal’s Thomas McConville)

implications on the city budget,” he said. In the first quarter of this year, CalPERS announced it was altering its smoothing and mortality assumption policies, resulting in increased costs to cities for public employee pensions. “We’ve got to figure . . . how to deal with increases in the pension costs and how large those will be. How much time we will have to deal with it is uncertain at this time.” Costs related to increased water management responsibilities may also weigh on the budget. “The regional water board adopted a permit in December of 2012 . . . which requires cities to prepare water quality plans,” Farfsing said. The City of Signal Hill is working with a group of cities in the Los Cerritos Channel and Los Angeles River areas to develop a watershed management plan to submit to the state. “The overall implementation cost over the 20-

year period could be close to $300 million for six communities,” he explained. “I think probably close to five percent of our entire city budget is [spent] on environmental programs related to storm water,” Farfsing said. In the 2011-12 fiscal year, Signal Hill spent $533,000 on storm water management. By the 2014-15 fiscal year the cost should reach $810,000, he projected. The city is also contending with real estate development roadblocks caused by changes in state policies. The dissolution of the redevelopment agency (RDA) continues to negatively impact development because the state has not yet approved the city’s RDA long-range property management plan, Farfsing pointed out. “[Because of] the fact that we can’t move forward with our long-range property management plan, [the state is] essentially holding hostage a number of properties in the com-

munity where we could have redevelopment or economic development,” he said. “It has created a de-facto moratorium on economic development in the community,” he said of the loss of the RDA and the state’s tardiness in approving the city’s plan for RDA properties. Farfsing said there are developers eager to invest in land in Signal Hill who currently can’t, due to the RDA property plan hang-up. At a vacant parcel of land south of Spring Street between Atlantic and Orange Avenues across from the Signal Hill Gateway Center, for example, Signal Hill Petroleum and “a number of users” are interested in building a hotel, medical offices and retail stores, he said. The property has remained undeveloped since the dissolution of the RDA. Another “curveball” from the state government came when its oil and gas division

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FOCUS ON SIGNAL HILL June 10-23, 2014

Long Beach Business Journal 3-B

Parks/Trails Calbrisas Park = 0.5 acres (2451 California Ave., featuring barbecue areas, half basketball court, picnic tables, playground)

Discovery Well Park = 4.9 acres (2200 Temple Ave., featuring barbecue areas, community room, half basketball court, picnic tables, playground, restrooms)

Hillbrook Park = 0.54 acres (1865 Temple Ave., featuring barbecue areas, picnic tables, playground)

Hilltop Park = 3.2 acres (2351 Dawson Ave., featuring barbecue areas, picnic tables, restrooms)

Panorama Promenade = 0.22 acres (2398 Dawson Ave., featuring exercise trail, seating, walking/running trails; open dawn to dusk)

Raymond Arbor Park = 0.33 acres (1881 Raymond Ave., featuring picnic tables, playground for 2-5 year olds)

Reservoir Park = 2.78 acres (3315 Gundry Ave., featuring barbecue areas, picnic tables, playground, restrooms)

Signal Hill Park = 10.07 acres (2175 Cherry Ave., featuring barbecue areas, basketball court, community room, picnic tables, playground, restrooms)

Sunset View Park = 0.47 acres

The 4.9-acre Discovery Well Park at 2200 Temple Ave. features barbecue areas, a community room available for rent, a half basketball court, picnic tables, a playground and restrooms. (Photograph by the Business Journal’s Thomas McConville)

(2300 Skyline Dr., featuring seating, views) Source: City of Signal Hill

ceased signing off on plans to develop properties over abandoned oil wells, shifting the responsibility to cities, Farfsing said. This change coincided with the loss of the RDA about three years ago. In order to allow building over abandoned wells, the city must amend its oil code – but before it amends its oil code, it must perform a study to determine best practices. Scott

Charney, Signal Hill director of community development, said he expected the study to be completed in the upcoming fiscal year. It is possible that a draft amendment to the oil code may be ready in a few months, but he said the timeline is uncertain. Until the oil code is amended and the state approves the city’s plan for RDA properties, development in the city is essentially at a standstill, Farfsing said.

“From my perspective, as a person who is supposed to create jobs and help the community and surrounding region, all I see are obstacles put in our way by a state bureaucracy,” he said. Reflecting upon the city’s accomplishments in its 90 years, Farfsing highlighted how the city privatized park and building maintenance. Contracting out has provided cost savings, which have helped maintain a balanced budget.

Councilmember Lori Woods also reflected on the 90th anniversary of the city. “[To grow] from a community covered by hundreds of oil derricks in the 1930s and 1940s to the pleasant, distinctive gem it is today is truly an amazing accomplishment,” she said. “My fellow councilmembers and I strive to continue this progress, mindful of residents’ quality of life and continued business development.” (Please Continue To Next Page)

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FOCUS ON SIGNAL HILL 4-B Long Beach Business Journal

June 10-23, 2014

Signal Hill Land Use Square Miles = 2.2 Industrial = 39 percent Residential = 35 percent Commercial = 21 percent Public/Institutional = 3 percent Open Space = 2 percent Source: City of Signal Hill

The Promontory community atop Signal Hill includes million dollar-plus homes. During the 12-month period through April, 40 single-family homes in the city closed sales, and 81 townhomes or condos closed, according to a report by Pacific West Association of Realtors. (Photograph by the Business Journal’s Thomas McConville)

Real Estate ith its panoramic views, central W location and business-friendly policies, Signal Hill is an attractive locale for homebuyers and businesses alike, local real estate professionals told the Business Journal. Demand for residential and com-

mercial real estate is strong in Signal Hill, but low inventories of properties for sale across all market sectors means that activity is “not overwhelming,” as one broker put it. Ian Hand, a Signal Hill resident and realtor with Coldwell Banker Coastal Alliance, said the city is an attractive bet for homebuyers looking for good views at reason-

Shaun McCullough, left, and Jeff Coburn, principals at Lee & Associates Commercial Real Estate Services, are pictured at 845 E. Willow St. in Signal Hill where a new medical office building is under construction. The two-story building consists of 18,986 rental square feet on 56,671 square feet of land and is estimated to be completed during the first quarter of 2015. For more information, call Lee & Associates at 562/354-2500. (Photograph by the Business Journal’s Thomas McConville)

able prices. In Signal Hill, Hand said, a home with good views may cost about $1 million, but in areas with similar views such as the Palos Verdes Peninsula, “you’ll certainly be paying a lot more than the price point of Signal Hill.” Prospective buyers who are unfamiliar with Signal Hill are often surprised by the views and quality of the housing stock, Hand noted. “I think people have preconceptions about the Signal Hill of the old days – the rough and ready knockabout oil rigger-type days when it was producing oil – not as a prestigious area,” he said. Another draw for homebuyers is that Signal Hill features more recently built single-family homes than neighboring cities like Long Beach, Hand said. Many homes in Signal Hill were built 20 to 25 years ago, while most homes in Long Beach are 60 to 70 years old, he explained. Hand and his Coldwell Banker colleague, Raleigh Dew, a broker associate who is also a Signal Hill resident, noted that while Signal Hill housing market activity was strong at the start of the year, it has tapered off in the past few months. Dew attributed the drop-off to a low inventory of homes for sale coupled with slower demand due to the summer vacation season. Research from the Pacific West Association of Realtors (PWAR) estimated the total inventory of single-family homes in April of this year to be about 4.3 months, meaning all homes on the market would sell out within 4.3 months given current demand. In the same month

Construction is underway to add Starbucks, Chipotle and Sprint stores at the Signal Hill Gateway Center at Spring Street and Atlantic Avenue. (Photograph by the Business Journal’s Thomas McConville)

last year, the total inventory of homes in Signal Hill was 2.1 months. Homes priced at $1 million or higher are experiencing less interest from prospective buyers than those priced below that figure, Dew and Hand observed. Hand noted that the most desirable price range for homes in Signal Hill is currently between $600,000 and $700,000. The median price of singlefamily homes in April of this year was $601,500, according to PWAR. Multi-family housing developers continue to look to Signal Hill for new opportunities. Irvine-based Summer Hill Homes recently took over a previously approved multi-family development at the northeast corner of Walnut Avenue and Crescent Heights Street for which building permits had expired. The originally proposed development, which is on land owned by Signal Hill Petroleum, included 26 units. According to a city development status report, Summer Hill Homes has submitted plans for review and is beginning community outreach for the project. “I would envision a [community] workshop in June,” said Signal Hill Director of Community Development Scott Charney. Due to old oil wells located on the property, Charney noted the developer must wait to construct the units until the city’s oil code has been amended to allow for building over abandoned wells. Before the amendment can be drafted, petroleum engineers must finalize their recommendations, and new requirements for leak testing abandoned wells must be fully implemented, Charney explained. “I would expect that in a couple months we would be coming back with an oil code amendment, but until I see the petroleum engineers’ report I am hesitant to give a schedule,” he said. Another multi-family housing development is nearly complete at 1835-1899 Orizaba Ave. Called Aragon, the development by MBK Homes features 81 condominium units. Charney said the city is inspecting the units under construction and expects the project to be completed this fiscal year (2014-2015). The retail segment of the real estate market is also experiencing some development activity, with a Chipotle, Starbucks and Sprint stores and a Bank of America ATM under construction at the Signal Hill Gateway Center. Last week, Costco began construction on a new gas station by its Willow Street location. Developer 2H Construction is also investing in new commercial properties in Signal Hill, with two medical office developments currently under construction. The larger of the two, a 19,000-square-foot two-story building at 845 E. Willow St., is close to having tenants secured before construction is completed, according to Jeff Coburn, principal at Lee & Associates. The other 2H Construction project underway is a 9,000-square-foot medical office building located at 2655 Walnut St.

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FOCUS ON SIGNAL HILL June 10-23, 2014

Long Beach Business Journal 5-B High demand for commercial properties in Signal Hill is driven by the city’s proximity to freeways and its business-friendly attitude, Rollema said. “Getting business licenses and conditional use permits is a lot easier than in some of the surrounding cities,” he explained. “The zoning is not as restricted as some of the surrounding areas, and it allows for a lot more uses in some of the industrial buildings,” he added. Rollema said the area is also attractive to businesses because it is centrally located between “the active markets of the South Bay and Orange County.”

Retail Industry fter weathering the Great Recession A and contending with years of uncertainty, Signal Hill retailers are now report-

Paul and Marian Martin are owners of Pirtek fluid transfer solutions located at 3299 Walnut Ave. The firm provides onsite hydraulic hose repair and replacement services. (Photograph by the Business Journal’s Thomas McConville)

Shaun McCullough, senior principal at Lee & Associates, called the Signal Hill office market “very healthy” overall. “The vacancy [rate] is maybe at 7 or 8 percent,” Coburn said of office properties within the city. He pointed out that this segment of the real estate market is “pretty tight” simply because there aren’t a whole lot of office buildings in the city, and those that are typically do not come up for sale. The industrial market is also characterized by a lack of available properties, with

only two for sale and five for lease citywide, according to Coldwell Banker Commercial BLAIR WESTMAC Associate Tyler Rollema. “I’d say the activity is pretty minimal in terms of what is being traded and what is currently on the market and available,” he said. The lack of industrial properties for sale coupled with a vacancy rate of 3.2 percent illustrates “the strength of Signal Hill in that a lot of companies want to be there, and when they are, they like to stay,” Rollema said.

ing an upward trajectory in sales and are optimistic about growing their businesses this year. “For the first time in several years there is an uptick in sales,” Randy Kemner, owner of The Wine Country on Redondo Avenue, told the Business Journal. “It is encouraging,” he added. He called wine stores “a great bellwether” for economic growth, noting that when the economy is bad, people spend less on wine and spirits, but when the economy improves, people begin spending more on higher-end products such as champagne. Judging by his increased sales, “In the past several months, the economy is really beginning to gain some steam,” Kemner said. (Please Continue To Next Page)

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FOCUS ON SIGNAL HILL 6-B Long Beach Business Journal

June 10-23, 2014

Charles Feder, co-owner of Rossmoor Pastries, located next to The Wine Country, said his business is experiencing growth this year. “We have been on a huge growth path since we moved to Signal Hill. It has been a wonderful environment for our retail business,” he said. Last year, Rossmoor Pastries experienced a 10 percent spike in sales compared with 2012. Feder estimated that revenues should increase between 3 and 4 percent this year. Although not as robust as last year, this rate of growth is within what he considers a healthy range for his business, he said. The Undershirt, a Signal Hillbased company providing career apparel with custom printing and embroidery options, is experiencing Shari Blackwell shows off some of the items she designed a “much improved” year compared in recognition of the City of Signal Hill’s 90th Anniversary. with 2013, according to owner Shari Blackwell owns The Undershirt, located at 931 E. 27th St. For more information, visit: Blackwell. “Not only is business up, (Photograph by the Business Journal’s Thomas McConville) but it is holding steady and is not having the big peaks and valleys that now for plans to expand our craft beer selecit did over the last three years or so,” tion, which has been exploding,” Kemner Blackwell said. “I think the economy is said. “We’re going to be installing a refrigerturning around,” she added. While sales ated beer room.” Last year, the store also have been sporadic over the past few years, expanded its wine tasting area and began activity has been steady since January, she offering a new service – wine storage locksaid. “I’m hoping that it will remain steady. ers. “We’re at over 50 percent of our capacI am seeing a lot of my old customers who ity,” Kemner said of the lockers. He added had scaled back [are now] increasing the that he plans to expand The Wine Country’s size of their orders,” she said. gourmet food section this year as well. All three companies are expanding their Rossmoor Pastries is growing, too. services this year, with Rossmoor Pastries “We’re in the process of building a 5,000and The Wine Country adding on to their square-foot bakery just to do gluten-free stores. “We’re meeting with architects right [baked goods],” Feder said. “The shovel


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The popular City Mex Grill Authentic Mexican Cuisine is located at 2594 Cherry Ave. at Willow Street. Open 10 a.m. to 9 p.m. daily, the restaurant offers online ordering at For more information, call 562/683-6160. Pictured center is owner Scott Jones, who is flanked, from left, by Cecilia Sanchez, general manager; Berenice Alavez, cashier; and Jorge Velasquez and Diego Aguilar, cooks. (Photograph by the Business Journal’s Thomas McConville)

should go in the ground in the next few weeks, and we’ll be doing gluten-free both for wholesale and retail,” he explained. He said that the demand for gluten-free foods is “growing like crazy” and called the trend “a growing influence on the way we eat.” While Blackwell typically sells directly to businesses, this year she is celebrating Signal Hill’s 90th anniversary with a line of apparel available for individuals to purchase at special events and online. “I am doing a dress shirt . . . embroidered with the Signal Hill 90th anniversary logo. I am also doing embroidered picnic blankets, which are perfect for our concerts in the park series coming up,” Blackwell said. “Both of those will be for sale at our big event, which is the city’s celebration and picnic at Signal Hill Park on June 21. I have also created a line of t-shirts for the celebration,” she said. Blackwell is donating 10 percent of proceeds from these items to the Signal Hill Community Foundation. All business owners expressed their optimism while also acknowledging the operational challenges they currently face. “The challenges for all independent retailers are the pressures of chain competition. They always have been,” Kemner said. “I like to think that The Wine Country is one of those stores that provide an incredible value to the community by providing an alternative to the cookie cutter mentality of corporate commerce.” For Blackwell, online competition has become steep. The Internet also poses a challenge in that customers are becoming more accustomed to communicating digitally rather than face to face, she said. “People just don’t have the time to sit and meet with you or even talk on the phone. Everything is email,” she said. Feder pointed out that a state senate bill that would raise minimum wage to $11 in 2015, $12 in 2016 and $13 an hour by 2017 would create difficulties for Rossmoor Pastries if it is approved. Beginning in 2018, the bill would require minimum wage to be adjusted with inflation. The bill passed the senate in late May and awaits assembly approval. “I will have to reduce my payroll here, which means I am going to have to buy machinery to replace [work-

ers],” Feder said. “We’re talking about [increases of] $4.50 an hour. I want my people to have a good living wage, but let’s be realistic in terms of how that is going to affect the economy. I think that such a huge leap in minimum wage is going to create less jobs for people.” In addition to the independent retailers reached by the Business Journal, Signal Hill is home to many franchise and chain retailers, including big box stores like The Home Depot and Costco, which continue to be among the top sales tax revenue generators in the city.

Restaurants cross Signal Hill, restaurants seem to A be experiencing a mixed bag of activity this year, with some reporting consistent growth and others reporting lagging sales. Big E Pizza, which has been located in Signal Hill on Pacific Coast Highway for 28 years, has been having a good year so far, owner Jimmy Eleopoulos told the Business Journal. “It’s going up little by little. Online orders seems to be taking over a big chunk,” he said of sales. For the first time in those 28 years, Big E is expanding. “I am tripling my space,” Eleopoulos said. He expects the expansion to create a 15 percent increase in business due to demand from dine-in customers. “We have a long line of people wanting to sit down, and we just don’t have the place for them,” he said, adding that the expansion will solve the issue. “We will also be able to take care of baseball teams and [host] different events because we will have a semi-private room, so that will help out tremendously.” City Mex, a Mexican quick-serve restaurant at the corner of Willow Street and Cherry Avenue, is experiencing weak activity so far this year, said owner Scott Jones. “We’re still on a small decline,” he said of City Mex’s sales, adding that last year revenues decreased by “a few percent” from 2012. “The economy still hasn’t come back to Signal Hill,” he said, explaining that many businesses that left the city at the peak of the Great Recession have not yet returned. As a result, the lunch hour, which used to generate the lion’s share of City

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FOCUS ON SIGNAL HILL June 10-23, 2014

Top 25 Sales Tax Generators In Signal Hill (In Alphabetical Order)

• A&A Ready Mixed Concrete • Allied Building Products • Altair Gases & Equipment • Best Buy • Black Gold Pump & Supply • Boulevard Buick GMC • Boulevard Cadillac • Chevron • Costco • Edepot • Financial Services Vehicle Trust • Food 4 Less

The Wine Country

Long Beach Business Journal 7-B

• Glenn Thomas Dodge • Hooman Nissan Of Long Beach • Long Beach BMW/Mini Cooper • Long Beach Honda • Mercedes Benz of Long Beach • Office Depot • PBI Market Equipment • Power Trip Rentals • Ross • Target • United Oil Co. • Weatherford Artificial Lift Sys.

Source: City of Signal Hill

Mex’s business, is no longer as strong, Jones said. Still, City Mex expanded services when the restaurant began offering breakfast last year. “We have a great breakfast menu. It is very inexpensive, and the people who come in are very loyal,� Jones said. Since opening in October, the Applebee’s at Signal Hill Gateway Center has had

steady growth in business, according to General Manager Joseph Abraham. “We had an excellent opening and haven’t slowed down a bit,� Abraham wrote in an e-mail. “Our sales continue to exceed expectations every week, and I am pleased to see that we have developed so many amazing regulars in such a short period of time,� he added. Applebee’s is soon to have two new fastfood establishments as neighbors at the Signal Hill Gateway Center, with a Chipotle and Starbucks currently under construction. David Slater, COO and executive vice president of Signal Hill Petroleum, which owns the center, said he expects construction to be completed by November. He noted that the restaurants located in the center seem to be successful. According to representatives from In-NOut Burger, the company’s location at the Signal Hill Gateway Center is one of its top earning stores, Slater said. Both Eleopoulos and Jones cited the increasing cost of doing business as a challenge to restaurant operations. For Eleopoulos, the increasing price of beef has been an issue in recent months. “Where ground beef for the last 10 years has hovered around $1.25 to $1.55 [per pound], it is now up to $2.55 and has stayed there for three or four months with no relief in sight,� he said. Food suppliers blame California’s drought for the price hikes, he explained, and the higher cost has forced Eleopoulos to increase some prices at Big E for the first time in five years. “I had to (Please Continue To Next Page)

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FOCUS ON SIGNAL HILL 8-B Long Beach Business Journal

June 10-23, 2014

do it, and now it seems like it wasn’t close to being enough,” he said. For Jones, the ever-increasing price of rent is a constant challenge. “Unfortunately the landlords raise the rent every year no matter what,” he said. He added that a state senate bill increasing the minimum wage would also increase costs if passed. Abraham said that while Applebee’s often has customers waiting for tables lined up out the front door, many residents in the surrounding Long Beach area still do not know the restaurant is nearby. “I can only hope that if we are able to deliver a great dining experience for a great price, we will get busier over time,” he said.

Auto Industry s summer approaches, U.S. conA sumers seem to be confident enough to purchase vehicles as indicated by several major auto dealers reporting sales increases from May of last year to the same month this year, with Chrysler, Nissan, General Motors and Toyota reporting double-digit growth. If the demand generating those sales holds, that could be good news for Signal Hill, home to a host of auto dealerships, some of which are the city’s biggest tax revenue generators. “It’s a record year,” Hooman Nissani, owner of the Hooman Nissan dealership on Spring Street, told the Business Journal. So far this year, “All our departments on average probably have grown between 40 to 60 percent,” he said. The Boulevard Buick/GMC dealership in Signal Hill experienced a 16 percent sales increase in 2013 from the previous year, according to co-owner Brad Willingham. Boulevard also operates a Cadillac dealership. Boulevard’s sales dipped a bit in the first four months of this year, Willingham said. “General Motors has had a couple of issues you may have heard about, so those things always affect us in unexpected ways, but by and large it [business] has been about the same as last year,” he said, referring to recent recalls of General Motors vehicles. “The problem is we have been expecting it to be a lot better.” Willingham predicted sales picking up during the remainder of the year, however. “We sell more cars in the summer time. People buy more cars to travel,” he said. “We’re expecting a good summer. I would like to think we could go up another 10 per-

Boulevard Buick GMC executives spotlight a 2014 GMC Sierra 1500 pickup truck at the Signal Hill Auto Center dealership on Cherry Avenue. From left are: Ron Charron, chief operating officer; Chad Charron, general manager; and Brad Willingham, chief financial officer. For more information, visit: (Photograph by the Business Journal’s Thomas McConville)

cent this year without too much trouble.” He added that the end of the year is also typically big for sales due to the holiday season and government tax incentives sometimes offered at that time to encourage spending. Nissani said he expects sales to remain strong at his Nissan dealership, which means he is likely to continue his recent hiring streak. “We are adding anywhere between four to five new employees to our dealership a month,” he said. “As our business grows we need more help, so we are constantly looking for people.” Willingham said Boulevard has recently added a few positions in the Internet sales department. “You have to staff that [department] now a little separately from your traditional sales floors,” he explained. Both Nissani and Willingham said they expect electric cars to become increasingly popular among consumers. The ELR, Cadillac’s new all-electric vehicle which operates off batteries and a generator, has gotten off to a slow start in sales, but Willingham sees potential for growth. “We love it. We think it can take on the Tesla,” he said. Tesla Motors specializes in highend electric vehicles. “Unlike Tesla, it comes with a nationwide dealer body, [and is] ready to go, ready to serve, ready to handle any recalls.” The Nissan Leaf, also an all-electric vehicle, “is doing really well,” Nissani said. Another local auto dealer is looking to

upsize. The Long Beach BMW dealership, which is part of the Signal Hill Auto Center, has plans to expand, according to Signal Hill Director of Community Development Scott Charney. “The big news in the auto center is the approval of plans for BMW to move from their existing facility at the corner of Cherry Avenue and Spring Street to the vacant parcel at Walnut [Avenue] and Spring,” he said. “The concept would be to build a brand new, state-of-the-art BMW dealership at the vacant parcel and then renovate the existing facility for a larger, upgraded BMW Mini dealership,” he explained. In 2006, the city invested $6 million in that parcel to prepare for CarMax to move onto it, but the deal fell through. In addition to its array of auto dealers, Signal Hill is home to many independent auto body and auto accessory businesses such as Bud’s Beach Cities, which provides services such as custom upholstering and sunroof installation. Tom Benson, owner of Bud’s, said this year has been “very erratic” so far for his business. “The first two months of the year were slower than anything in the last 10 years for us,” he recalled. But things are looking up. “It has picked up very nicely. We are on an even keel now. It is not quite predictable, but it is certainly much better,” he said. “With the growth of the dealer market I am doing more for dealers,” Benson said. “That has worked very well.”

Oil Industry lthough Signal Hill’s contemporary A retail and residential-rich environment would be unrecognizable to the early 20th century oil prospectors whose derricks covered the landscape, the city remains synonymous with oil production. Currently, 428 permitted oil wells operate within city limits, and a city official guessed that there are “thousands” of unquantifiable, abandoned wells buried beneath the city. The oilfield under Signal Hill continues to produce more than one million barrels of oil per year, which should generate about $1.2 million in tax revenues in the 2014 to 2015 fiscal year, according to city estimates. This equates to about a 33 percent increase in oil tax revenue from the previous fiscal year. Oil production taxes are the second largest generator of tax revenue for the city, following a sales and use tax. Signal Hill Petroleum (SHP) has increased oil production this past year through the use of modern technology. A couple of years ago, residents may have noticed trucks driving slowly through the streets, vibrating the ground as they rolled by. These trucks contained SHP employees who were conducting a geological survey of the ground beneath the city and looking to find oil resources through a process called 3D seismic imaging. Using data gathered through this survey, SHP has increased its daily oil production to 3,500

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FOCUS ON SIGNAL HILL June 10-23, 2014

Long Beach Business Journal 9-B

POSH W Believe in in Community Community Wee Believe W rk with with Integrity Integrity Wee Wo Work We Preserve Preserve Traditions Traditions We W hare H istory Wee S Share History W re Better Better Together! Together! Wee A Are In business for more than 60 years, Bud’s Auto Upholstery is located at 2637 St. Louis Ave. Owner Tom Benson sits in a 1947 Plymouth as his staff looks on, from left: Max Chavez and Bryce Nichols, trimmers; Ifrael Baneulos, installer; Darling Mumford, administrative assistant; and Javier Castenada, trimmer. Bud’s provides free estimates. Call 562/595-6370 or visit: (Photograph by the Business Journal’s Thomas McConville)

barrels, according to COO and Executive Vice President David Slater. The production increase has led to an increase in revenues, Slater said. “With the increased revenues, it does give us the opportunity to invest more into the company. It has allowed us to expand and add new jobs,” he said. In the past year, SHP added about 25 additional jobs to its local operations, about 90 percent of which are field operations positions, Slater said. The remaining jobs are engineering and geology-related technical assignments.

“If we have the success we think we’re going to have in the next six months, continuing to grow the company as far as staffing is highly likely,” Slater said. “We’re at a juncture right now where we have staffed up. We’re investing [and] production and revenue are increasing, but we need to see a longer history of successful results before we take another step,” he noted. California’s regulatory environment is the biggest challenge to business, Slater said. “Our biggest impediment to continu-


Rotary Club of Signal Hill Hill Congratulations Years Congratulations on 50 Y ears of Dedicated De dicated Community Service! Service! R Recognition ecognition iis s g given iven tto o the late Past President Nancy Long for establishing (2004) and funding the Annual Rotary Club of Signal Hill’s “Educational School Supply Kit” program. A special “Thank You” to Bob Long for keeping Nancy’s legacy alive by your continued funding of this program that provides school kits to all Signal Hill elementary school students. For information on the

h Anniversary Celebration Dinner 50tth June 26, 2014 @ Long Beach Petroleum Club or our Annual Chili Cook-Off & Scholarship Fundraiser Please Call: 562-716-0986 Rotary of Signal Hill meets every Thursday at 7:30am @ Curley’s Cafe

ing to grow the business is regulatory permits and specifically [those required by] South Coast Air Quality Management District [SCAQMD],” he explained. “The amount of work preparing permit packages and the time frame to get permits approved is long,” he added. SCAQMD recently implemented reporting requirements for oil and gas companies engaged in well completion or well reworking activities. Under these requirements, companies must notify SCAQMD of the activities and disclose the names and quantities of chemicals used. ■


POSH meets every Tuesday Tuesday of the Month COMMUNITY Curley’s Cafe at 6:30pm @ Curley’s To conduct our work www.poshhistory

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PERSPECTIVE 10-B Long Beach Business Journal

June 10-23, 2014

The Myth Of Multitasking – Part II What Does Science Say?

■ EFFECTIVE LEADERSHIP By Mick Ukleja he concept of multitasking has grown in concert with the rapid increase in technology. For me on a personal level, this has blurred stopping points, boundaries and finish lines. You’ve experienced this. No matter where we retreat, our work follows us closely. Like a bad rash, we know that scratching the itch will make it worse – but we scratch anyway. We are often unaware of the leak in the gas tank – draining away any reserve energy we thought we had. We have multiple sources of input at any given time. According to one study¹ there is a tremendous increase in media used. But the increase in media usage – Internet, television, video games, smart phones, text messaging, email – decreases the amount of attention paid to each device. Their power to interrupt is growing exponentially. In one study a group of Microsoft workers took an average of 15 minutes to return to serious mental tasks (writing reports or computer code), after responding to incoming email or instant messages. Microsoft researchers were surprised by how easily people were distracted, and how long it took them to get back to the task². If it’s bad at Microsoft then you know it’s having an impact in other organizations. The average worker is interrupted four times an hour. The more challenging the work, the less likely they are to go back


to it after the interruption. In other words, our most important work is hit the hardest. The effect is the same as a person who goes to work high or drunk, yet thinks they are being productive. Can we do more than one thing at a time? The answer is yes and no. It is true that you can fold laundry and watch television because those are different functions of the brain. Driving and listening to the radio can also be done, but when you begin to change the stations, a competing process breaks in and you lose focus on what’s going on around your vehicle. Professional truck drivers are 2,300 times more likely to get in an accident while text messaging. The world of finance uses a term called “switch-cost.” This term describes the recovery time associated with each switch. The same principle applies in “switch-tasking.” Every time you switch rapidly between activities you lose some precious time and loss of attention. In other words, there is a switch cost in switch-tasking. It might be time, or money, or both. Every little switch loses some amount of time and productivity. So what can be done? Try multi-purposing³. Typing an email and sending it to six people is not technically multitasking. It’s multi-purposing. You are bundling things you want to accomplish. Another example would be combining exercise and getting to your clients office by riding a bicycle. But talking on the phone and doing email is not multipurposing, nor is it technically multitasking. It’s switch-tasking. The processing part of your brain disallows you to do two or more of these tasks at the same time. You are simply switching, and that’s why time and productivity are lost. Switching back and

forth takes time to get your processing head back on track. I have had those instances when I have started writing, got interrupted, and had to go back to the beginning to reorient my mind in order to catch the flow of how I got to where I was in my thinking. Another name for this would be wasted time! Think of attention as the beam of a flashlight. Try as you will, you can never shine the light on two separate objects simultaneously. What you are doing is rapidly switching the beam back and forth between the objects. So it is with our attention. When we juggle complex tasks, we are not multitasking. We are simply switching the focus of our attention back and forth between tasks that we are attempting to track. When we switch, our brains must take a moment to reload, remind and recalculate. In “Brain Rules,” John Medina calls this cognitive switching penalty4. Don’t believe the myths about multitasking. Believe the science. Do not let the marvels of our technological advances and gadgets reinforce behavior that is counterproductive. And don’t do email while on that conference call. ¹Kaiser Family Foundation; Rosen, Christine. “The Myth of Multitasking.” ²New York Times; “Slow down brave multitasker, and don’t read this in traffic.” Lohr, Steve. March 25, 2007. ³”18 Minutes: Find Your Focus, Master Distraction, And Get The Right Things Done.” Bregman, Peter. 4 ”Brain Rules,” Medina, John. (Mick Ukleja is the author of several books, a coach, keynote speaker and president of LeadershipTraq, a leadership consulting firm. Check his weekly blog at

EARTHTALK Driverless Cars ®

Dear EarthTalk: What are the environmental implications of the so-called “driverless car” that Google and others are working on right now? – April Jackman, Barre, MA

Just a decade ago most of us wouldn’t have dreamed we’d live to see driverless cars whisking people around, but things are changing fast and analysts now think they will be common by 2020 and account for the majority of cars on the road by 2040. And with Google’s recent unveiling of its latest prototype – complete with no pedals or steering wheel – the future is indeed closer than we ever imagined. Proponents argue that driverless cars – also called “autonomous cars” – are inherently more sustainable than their manned counterparts. For one, they say, once they are widely available many of us will forego owning our own cars in favor of car-sharing, whereby the autonomous vehicle comes to you, charged and ready to go, as needed. Thus the result could be far fewer cars on the road than today. According to Steve Gutmann of the Seattle-based sustainability think tank Sightline Institute, such a car-sharing scenario would also obviate the need for many parking spaces. Today the typical private car spends upwards of 90 percent of its time parked. Once we have more driverless cars, we’ll need far fewer parking spaces, leading to less land being paved and

reducing storm water runoff and heat island effects accordingly. The networked brains of these vehicles will also reduce inefficient routes and decrease overall driving time, leading to better air quality and lower carbon emissions. Also, the increased safety of driverless vehicles – they obey speed limits, can sense people, bikes and other cars coming toward them, and accelerate and brake much more gradually than human drivers – will mean that the cars can be lighter and require far fewer resources in manufacturing, reducing their overall environmental impact even further. On the flip side, the advent of driverless cars means that many of us now not able to drive because of age or physical handicaps will be able to use these cars to get around, potentially leading to an increase in the number of cars on the road. And Chandra Bhat of the Center for Transportation Research at the University of Texas points out that just because a car is driverless doesn’t mean we’ll want it to be smaller, lighter and more fuel efficient. He fears that driverless cars will engender a return to larger vehicles because people will want “more comfortable space” when they are free to stretch out, relax, read, videochat, text or even nap during their trips. He adds that driverless cars could lead to more urban sprawl as car commuting becomes more tolerable without the hassle of actually driving.

Bhat also wonders what will become of the public transit systems we’ve invested so heavily in if driverless cars offer the same advantages – using the time en route to do whatever one pleases – with the added benefit of privacy and route/timing flexibility. Today four U.S. states – Nevada, Florida, California and Michigan – allow driverless cars on their public roads for the purpose of testing; several other states are considering similar allowances. Likewise, in 2013 the United Kingdom began allowing the testing of driverless cars on its public roadways. Besides Google, several leading automakers and other companies have developed their own prototypes. Car enthusiasts can expect to see such examples from the likes of Mercedes-Benz, General Motors, Nissan, Toyota, Audi, Volvo, Tesla and others at auto shows over the next few years, and can look forward to getting “behind the wheel” of one within a decade. Whatever happens, it certainly is going to be quite a ride. Contacts: Sightline Institute,; Chandra Bhat, (EarthTalk® is written and edited by Roddy Scheer and Doug Moss and is a registered trademark of E – The Environmental Magazine, www. Send questions to:

Becoming An Adult: Pediatric Patients’ Path To Medical Independence dvances in clinical care and research in pediatric health care have made it possible for many children with serious childhood diseases to live longer lives. With these children now living into adulthood, there is a growing need for support throughout their adolescence and young adulthood to help increase independence and prepare youth for transfer to the adult health care setting. Throughout your child’s teen years, there are many steps you can take to help prepare ■ HEALTHWISE them for this transition. By Erika Jewell, Getting Things Started: Ages 14-15 LCSW The teen years are a great time to practice independence. You can help your teen begin to take responsibility and learn everything they can about their health care. • Encourage them to learn about their conditions. o Does your teen know the name and cause of their illness? o Can your teen name their medications and when they are taken? o Does your teen know what to do to stay healthy? • Encourage them to do as much as they can on their own. o How much help and how many reminders does your teen need to take care of daily health activities? o Can they do these things without your help? o Can they ask for help and articulate their needs? At this time, they will not be able to do everything on their own, so expect them to ask for help from you or other adults in their life. You might notice they will make progress, but then need help and supervision again; this is normal. • Encourage them to participate in their health care. o How much does your teen say during their doctor visits? o Do they spend time alone with the doctor and participate in making decisions? Preparing for the Road Ahead: Ages 16-17 Now that your teen knows all about their condition, you can help them to start preparing for what lies ahead. As an adult seeing health care providers that specialize in adult care, your teen will need to learn to speak for themselves and tell their doctors what they need. • Encourage them to ask questions when they feel they need more information. • Encourage them to let their doctors know that they would like to be more involved. • Encourage them to write down their medical information and keep track of health related experiences. • Encourage them to write down questions for their next doctor visit and keep track of procedures, appointments and medications. Smart phones can be an excellent and teen-friendly tool for these activities. If your teen is going away for college or living away from home, it is important that you help them plan for the future. Finding a new provider may be difficult, so start looking as early as possible. After finding a provider, it’s important that your teen makes a “new patient appointment” to discuss their condition and ask questions. The Final Steps: Ages 18 & Up When your teen turns 18 they legally earn the right to give consent for medical procedures and control access to their medical information. They will need to find out from their medical team how long they can stay with their practice (i.e., do they see patients until the age of 18? 21?). Between the ages of 18 and 21, there are many things they will need to figure out before moving to the adult health care setting. First, they will need to know what their health care insurance will be. Whether they’re receiving coverage through the government, work, or buying it independently, they should be aware of their options and eligibility restrictions, including premiums, co-payments and formularies. You do not want them to be without coverage and unable to pay for the care they need. Second, it’s important to find out who the best “adult” doctor will be, whether it’s a primary care doctor or a specialist who will take care of any chronic health conditions. Is that primary care doctor or specialist comfortable with managing the condition? Remember that the key to an easy transition is involvement. Making sure your teen or young adult is involved will help keep them on top of their health and their path to independence. (Erika Jewell, LCSW, is the coordinator of the Transition of Care Program at Miller Children’s Hospital Long Beach.)


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PERSPECTIVE June 10-23, 2014

Long Beach Business Journal 11-B

Gap In Affordability Is Widening

■ REALTY VIEWS By Terry Ross s media reports regarding the state of the real estate recovery seem to come from all directions, and depending on price range and location, the story and prognosis for the coming months and years can be quite different. No one size fits all and in a world that bombards people with information and data at an ever-increasing pace minute by minute – the headline for a complex story – be it in print, online or televised – is now taking on more importance as consumers attempt to get a quick fix of the facts and move on to the next topic. This is particularly true in the housing portion of real estate where the variation in price rebounds and affordability are so dependent on the city and state, not to mention the pricing levels from starter homes to wealthy buyers who seem to be rebounding nicely and are making purchases more in tune to 2005 than in 2009. For the wealthy home buyers, their world has stabilized and although perhaps in many instances not as flush as a decade ago, they know what to expect from their businesses or other sources of income. Perhaps not as free-wheeling as before – these buyers can make confident purchases based on their assets and earning power,


even though more caution is involved. For the middle and lower economic classes there is still much uncertainty regarding jobs, wages and the very ability to obtain financing, which is a night and day world compared to the days before the housing bubble burst. It is well-documented that lower and middle-tier home prices zoomed up a year ago because of investors who were scooping up bargains until the bargains got too expensive. Now with fewer lender-owned bargains and short sales, the rate of transactions has slowed dramatically and we are left with mostly true-market sales where prices aren’t advancing very fast. In the higher-end and million dollar home category, you still see sellers making money, but the profit margins are subdued compared with 10 years ago. This all brings us to the general periodical reports of housing prices, which are mostly calculated on median – meaning half of the homes sold below and half above a given price. These can be very misleading. Location, local wages and affordability work hand-in-hand to determine how robust a market is, and the potential for price appreciation is very different from market to market. For instance, in cities such as San Francisco, Los Angeles, New York, Boston and Denver – where prices have rebounded (and mostly in the upper end) – it is much more difficult for the average earner to afford a home. Wealthier buyers in these locations won’t be affected as much, but the rank-and-file are still going to struggle finding the dollars, so they won’t be able to make purchases as prices go higher in the same numbers that we

have seen over the last year or so. “High-cost cities are rebounding faster than low-cost ones,” said David Crowe, chief economist for the National Association of Home Builders (NAHB). “Unusually large increases in wealth have driven up prices.” In San Francisco – the most expensive metro market in the nation with a median home price of $815,000 – only 13.3 percent of homes could be purchased comfortably by households earning the median income of $100,000. That was down from 28.9 percent in 2013. Expensive cities tend to keep growing more expensive because they’re already so densely packed with housing. “A way to keep prices down is to add to the supply by building new homes,” Crowe added. But that’s harder to do in places where there’s not much land to build on due to coastlines or mountains. Meanwhile, the most affordable U.S. cities tend to be in the Midwest and Northeast, predominantly in old industrial towns where the economy is no longer expanding and there is plenty of land on which to build. In Syracuse for example, nearly 94 percent of homes could be comfortably paid for by a family earning the median income, according to the NAHB’s index. That’s up from 91.6 percent a year before. Helping Syracuse’s residents better afford homes is its high median income of $67,700, which is about $4,000 higher than the national median. That goes a long way toward affording a home in the area, where the median price is just $94,000.

Nationwide, affordability has improved. Even though median incomes shrunk to $63,900 from $64,400 in 2013, median home prices have also fallen this past quarter, to $195,000 from $205,000 in the fourth quarter of 2013. Even taking this to the micro level in Southern California, the affordability and resulting cost of home ownership varies substantially. For example, Orange County is ranked as the most expensive part of our region, according to a CNN Cost of Living Calculator. It indicates that someone making $50,000 in Orange County could buy the same things in the Long Beach-Los Angeles area for $46,100 – and this includes housing that is 16 percent lower. In the Riverside area a person making only $39,876 would have the same buying power as $50,000 in Orange County and housing would be 42 percent less. In San Diego you would need $46,242 – about the same as in Long Beach – and housing is 14 percent lower than Orange County. Then you can take this out of state and compare with Denver, where you could live the same as with $50,000 in Orange County on $36,849 with housing costs averaging 51 percent less. This is why the housing markets across the nation are so different and any attempt to throw a blanket over the entire nation and economic spectrum and say up or down is way too generalized. (Terry Ross, the broker-owner of TR Properties, will answer any questions about today’s real estate market. E-mail questions to Realty Views at or call 949/457-4922.)

Vol. XXVII No. 11 June 10-23, 2014 EDITOR & PUBLISHER George Economides SALES & MARKETING EXECUTIVE Michael Watkins SALES & MARKETING ASSISTANT Heather Dann DISTRIBUTION Conrad Riley EDITORIAL DEPARTMENT STAFF WRITERS Brandon Ferguson Samantha Mehlinger PHOTOJOURNALIST Thomas McConville COPY EDITOR Lindsay Christopher The Long Beach Business Journal is a publication




Publishing, Inc., incorporated in the State of California in July 1985. It is published




(except between Christmas and midJanuary) – 25 copies annually. The Business Journal premiered March 1987 as the Long Beach Airport Business Journal. Reproduction in whole or in part without written permission is strictly prohibited unless otherwise stated. Opinions expressed by perspective writers

It Takes A Village To Raise A Philanthropist

■ THIRD SECTOR REPORT By Jeffrey Wilcox ost of us grew up with the idea of the importance of sharing. Our first report cards gave us marks about how well we “played with other children,” “respected others,” and “shared.” What we now know is that many adults will score about the same in each of these areas as they did when they were children decades earlier. By the time we enter school, a set of beliefs about and behaviors toward other people has already starting to take shape and each forms the foundation for who we will become later in life. For young children, the messages of caring for others, especially those less fortunate than themselves, can be hard to understand. For example, what happens to youngsters who are continually reminded that they must clean their plates because there’s hungry children? What about making a child


wear shoes that hurt his feet or she loathes because there are poor kids who don’t have any shoes at all? What happens to abused children who are reminded how fortunate they are to even have parents that love them because of the number of children who don’t? These and countless other scenarios drawn for children put a set of feelings and associations, if not resentments, into motion. At some point, every parent is going to see for themselves exactly what they have taught their children about giving, sharing, and the value of people who are unlike themselves. Teaching children about giving has become a well-researched process. For parents, there are many organizations, like Parents Magazine, that have produced a wealth of helpful information, guides and online resources. The teaching process is based on two tenets. The first is for parents to understand the importance of being role models to their children starting at a very early age and throughout their lives. Suggested role modeling includes participating in clothing, food and blood drives, volunteering for projects, helping a neighbor, carefully choosing words to describe the less fortunate, and performing random acts of kindness.

The second tenet is making giving a family affair. Asking children to research and select a charity for the family to support. Making sure support for an animal welfare organization is part of a family’s definition of responsible pet ownership. Turning a birthday party into an opportunity for a charitable act. Having the child place an offering on behalf of the family in the collection plate at church. Or, having the child select a toy to add with other family belongings for donation while taking the child to shop at a thrift store to understand the joy of benefitting from the generosity of others. As every nonprofit organization faces the continual and gnawing pressures of being overburdened and under-resourced, is it fair to ask, “Do all beneficiaries of giving have an obligation to be visibly involved in teaching young children about giving?” Or, is the expectation that parents, schools, and a few youth organizations just need to do their respective parts to make sure there is a large battalion of future philanthropists sufficiently incubated to generously share their time, talents and treasures when the rest of the sector comes knocking for contributions? It’s been said that it takes a village to raise a child. It also takes a village

to raise a philanthropist. And, every beneficiary of philanthropy has an obligation to make a contribution to that process. That means stepping up to the plate, in the midst of everything else that’s going on, and considering how to expose the children of boardmembers, volunteers and staff to the meaningful work of their parents. It also means that every nonprofit must provide helpful information to their employees, contributors, boardmembers and constituencies about the many ways to teach children about giving. It also pushes the envelope to consider what a family contribution, as opposed to an individual contribution, could mean to advancing an organization’s mission. Every member of the village needs to consider, “What have I contributed to creating future contributors?” And, if these suggestions for parents and organizations seem irrelevant to the bottom line, timeconsuming or inconvenient, let’s be reminded of one other thing mom and dad taught us: You reap what you sow. (Jeffrey R. Wilcox, CFRE, is president and chief executive officer of The Third Sector Company, Inc. Join in on the conversation about this article at the Long Beach Business Journal website

and guest columnists are their views and not necessarily those of the Business Journal. Press releases should be sent to the address shown below. South Coast Publishing also produces Destinations and the Employee Times magazines. Office South Coast Publishing, Inc. 2599 E. 28th Street, Suite 212 Signal Hill, CA 90755 Ph: 562/988-1222 • Fx: 562/988-1239 Advertising and Editorial Deadlines Wednesday prior to publication date. Note: Press releases should be faxed or mailed. No follow up calls, please. For a copy of the 2014 advertising and editorial calendar, please fax request to 562/988-1239. Include your name, company and address and a copy will be sent to you. Distribution: Minimum 25,000. Regular Office Hours Monday-Friday 8:30 a.m.-5:30 p.m. Business Journal Subscriptions Standard Bulk Rate: $28.00 1st Class: $70.00 (25 issues – 1 year)

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June 10-23, 2014 Section B  
June 10-23, 2014 Section B  

The Business Journal presents its Annual Focus on Signal Hill and a focus on law.