August 2014 Business Magazine

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BUSINESS M A G A Z I N E Manufacturer & Business Association

VOLUME XXVII, NUMBER 8

AUGUST 2014

Calvin Ernst, Founder and President

50 Years and Still Growing / Page 12

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August 2014

EDITORIAL >

FEATURES >

7 / Health Matters

3 / Spotlight

How reducing non-urgent emergency room visits can help improve cost savings and care.

James Kurre, Ph.D., director of the Economic Institute of Erie (ERIE), which collects, analyzes, interprets, and disseminates data and the resulting knowledge related to Erie County’s economy, shares his thoughts on education, economics, and what’s in store for ERIE’s future.

STEPHEN PERKINS, MD

9 / Legal Brief What landowners could stand to lose if they are unprepared for drilling deals with agents/owners. W. PATRICK DELANEY

for their patriotic Madison Rising, nationally known rally, during the performances, kicked off the Roar by Marquette Wednesday night concert sponsored Main Stage. Savings Bank on the Country Fair

Events 2014 Bike Rally // Erie, PA JULY 16, 17, 18 & 19

& bike rally was presented by the Manufacturer of The eighth annual Roar on the Shore Budweiser, Country Fair/Citgo, Harley-Davidson Off-Road Business Association, major sponsors & Mfg. Inc., Jagermeister, Kawasaki, Erie, Indian Motorcycle, Industrial Sales Russ Brown Motorcycle Attorneys, Toyota, 101, Express, PNC, Ridg-U-Rak Inc., Rocket For complete more than 45 area business sponsors. Zippo, as well as the City of Erie and re.com. the 2015 rally, visit www.roaronthesho photo coverage and information on

the Zippo Bikers flocked to get a glimpse of car from the Bradford-based company.

®

Legendary rock icon John Kay brought the “Heavy Metal Thunder” to Erie, during the John Kay & Steppenwolf concert sponsored by PNC.

Patrick’s Sister Mary Fromknecht, SSJ of St. who Haven was one of several Sisters enjoyed this year’s Faith and Freedom Bayfront Ride.

Sister Phyllis Hilbert, SSJ is all smiles the back of Bill Hilbert Jr.’s bike.

on

at Presque Isle Downs & More than 5,000 bikes gathered sponsored by Toyota. Casino for the annual bike parade,

music at Rally goers enjoyed even more live Park Row. the Jagermeister Stage on North Burns cooked The Cab owners Bob and Natalie for bikers at the up their world-famous pig roast County Ride. new Covered Bridges of Ashtabula

Marlene Mosco, regional president of PNC Bank, waves to the crowd. PNC sponsored the Faith and Freedom Bayfront Ride on Wednesday, as well as Friday night’s on John Kay & Steppenwolf concert the Country Fair Main Stage.

Grand Marshal Danny “The Count” Koker waves to the crowd as he leads thousands of bikers down State Street. Koker and his band Count’s 77 then rocked The Hub as the Thursday night headliners on the Country Fair Main Stage.

of Rebecca and Bill Hilbert, vice chairman the Manufacturer & Business Association Shore and chairman of the Roar on the Board of Directors, greet 2014 Grand Marshal Danny “The Count” Koker.

Destiny Schick was crowned 2014-2015 night. Miss Roar on the Shore on Saturday

Former Pittsburgh Steelers wide receiver Louis Lipps made a guest appearance at the rally.

Rally goers lined the streets for a stunning stunt show by Team No Limit, sponsored by Off-Road Express.

is surrounded by Miss Pennsylvania Amanda Smith and Miss Roar Miss Roar on the Shore contestants appearance 2013-2014 Natalie Coleman. Smith’s was sponsored by Country Fair/Citgo.

Roar a Erie Mayor Joe Sinnott presented proclamation on behalf of the city. Organizers estimate that between out 100,000 and 125,000 people came rally, to support the four-day motorcycle of which generated an economic impact more than $20 million.

2014 22 < www.mbabizmag.com < August

Dee Snider performed at Saturday’s headline concert, sponsored by Russ Brown Motorcycle Attorneys, on the Country Fair Main Stage.

Erie Mayor Joe Sinnott drew the winning ticket for the Harley bike raffle, sponsored by Sue and Kelly Lapping of Harley-Davidson of Erie.

Tim Smith of the hit TV show “Moonshiners” also made a special appearance at the rally, courtesy of Off-Road Express.

Guest columnist Charlie Gerow, CEO of Quantum Communications, a Harrisburgbased public relations and issue advocacy firm, discusses what he believes are the five key factors that will help Governor Corbett win re-election this November.

Patty Welther Business Magazine Account Executive to Michelle Wescott. (right) presents a Roar prize pack more than 75 new Wescott’s name was drawn from the digital subscribers who signed up to receive edition of the magazine at www.mbabizmag.com.

Calvin Ernst shares how he and his family have been progressive in moving the Meadville, Pennsylvania family business forward over the past 50 years to become one of the nation’s largest wholesale native seed suppliers.

> 23 August 2014 > www.mbabizmag.com

2014 HR Raffle Drawing!

EVENT > 22 / 2014 Roar on the Shore® A roaring success! From the bikes and bands to a crowd of more than 100,000, see all the action from this year’s eighth annual charitable motorcycle rally benefiting St. Patrick’s Haven.

DEPARTMENTS > 4 / Business Buzz 16 / HR Connection

11

12 / Ernst Conservation Seeds

Joe Askins announces the winning ticket for the Indian motorcycle raffle, donated by Indian Motorcycle of Erie. Askins also raffled a Kawasaki Ninja, courtesy of Off-Road Express.

and Freedom Roar 2014 kicked off with the Faith of St. Joseph of Bayfront Ride: A Ride with the Sisters of the four-day Northwestern Pennsylvania. Proceeds a homeless shelter rally benefited St. Patrick’s Haven, run by the Sisters and their Associates.

11 / On the Hill

4

20 / HR Q&A 24 / People Buzz

It’s FREE! Register to become a new subscriber to the digital edition of the Business Magazine online at www.mbabizmag.com and get a chance to win a free ticket to the MBA’s second annual HR & Employment Law Conference on October 10, three bestselling business books - Raving Fans, Hire Like You Just Beat Cancer, and Who Moved My Cheese? - plus two new coffee mugs! Drawing to be held September 25. August 2014 > www.mbabizmag.com > 1

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The importance of economics education goes far beyond understanding the basic principles of supply and demand and the workings of our nation’s economy. Economics is also the study of how people make sound choices, which can influence both individual and business success. James Kurre, Ph.D., director of the Economic Institute of Erie (ERIE), which collects, analyzes, interprets, and disseminates data and the resulting knowledge related to Erie County’s economy, recently shared his thoughts on education, economics, and what’s in store for ERIE’s future.

You recently retired after 37 years of teaching economics as an associate professor at Penn State Erie. Tell us what attracted you to teaching economics here in Erie for so long. Frankly, when I applied to Erie, I didn’t even know where it was. I had to look it up on a map. As I was finishing my graduate studies in Detroit, I applied for many, many academic jobs. Behrend was kind enough to invite me for an interview, which was my first commercial flight ever. (It was in early April and the Erie airport was snowed in, so I somehow wound up on a bus from Pittsburgh.) When Behrend gave me a job offer, I expected to stay for a year or two while I finished my dissertation and then move on to a big city. Suddenly, it’s 37 years later! But seriously, Behrend turned out to be a great place for me. This job has taken me across the globe and given me the chance to be involved in many neat projects. And I’ve had some wonderful experiences with my students. (Well, most of them.) In fact, five of my former students now teach in the Black School at Behrend. Henry Ford once said, “anyone who stops learning is old, whether at 20 or 80.” What is the most valuable lesson you learned about education during your tenure? First, full disclosure: I haven’t owned a Ford since my 1969 Torino GT, which left me stranded for a while beside a Kansas sunflower field in 1972. But I do like his quote! A key thing I discovered during all those years in the classroom is that most students will rise to the level you expect of them. If you set the bar low, you’ll get low performance. If you set the bar high and tell them why they should expect a lot from themselves, they’ll perform at a higher level — and, hopefully, they’ll learn a life lesson about themselves in the process. By studying economics, our young people can also learn how to make efficient and informed choices. What message do you want to share with these students about the importance of economics education and how it can benefit them? A key theme of all my classes has been “what’s this have to do with you, right now?” Econ can be pretty arcane and abstract, but most fundamentally it’s about how to make decisions. And when students see how it can help them make important — and even minor — decisions now, they start to get into it. In the best cases, students leave my classes understanding how to use Econ in their own lives, and also better understanding why other people do what they do, and how the world really works. More broadly, I hope to help them see their college classes not as a bunch of hoops to jump through, or class periods to be endured, but rather as opportunities to learn interesting and useful stuff that will turn them into the people they’d like to be. During past economic forecasts that you’ve presented at the Association, you have always indicated that education is one of Erie’s strengths and thriving industries. How do you see this impacting our area in the future? The success of the local colleges, including LECOM (Lake Erie College of Osteopathic Medicine), is one of the key bright spots in Erie’s economy, no doubt about it. Although this sector only accounts for a relatively small share of local employment and income, it is a direct link to Erie’s future. Because of the colleges, some of the best and brightest kids (and increasingly, nontraditional students) from around the world come to Erie for a few years. We get a shot at keeping them here! Erie’s age demographics tend a bit to the older side, and doing a better job of keeping more of our grads (both our own kids and other peoples’) would be a great way to help rejuvenate the economy. Some of that is already going on. But I’d encourage your readers to consider adding or expanding their (paid) internship programs. Doing so has clearly worked very well for some local firms, like FMC. It’s a win-win-win — for the firm, the student, and the region. Each year, ERIE hosts its highly anticipated Economic Conference. What do you have planned for the 12th annual event? We’re planning for the 12th ERIE Economic Conference to focus on manufacturing, a very important topic for Erie and for your readers! We hope to bring in a nationally known speaker. But we’re working through some administrative issues related to my retirement from teaching, so we’re not quite sure when the conference will be. We’ll be sure to let you and your readers know as soon as we nail it down.

Reprinted with permission from Times Publishing Company, Erie, PA. © 2014

SPOTLIGHT >

Contact: Karen Torres

VOL. X X VII, NO. 8 AUGUST 2014 Manufacturer & Business Association Board of Governors

Editor in Chief Executive Editor

Joel Berdine John Cline Harry Eighmy Andrew Foyle Mark Hanaway Donald Hester Bill Hilbert Jr. Timothy Hunter Phil Katen Paul Kenny Jeff Plyler Sue Sutto Mike Weber Ralph Pontillo rpontillo@mbausa.org John Krahe jkrahe@mbausa.org

Managing Editor & Senior Writer

Karen Torres ktorres@mbausa.org

Contributing Writers

W. Patrick Delaney Stephen Perkins, MD

Cover Photography

Matt Kleck R. Frank Photography 4320 Miller Avenue Erie, PA 16510 814/520-3985

Additional Photography

Brad Drumheller Drumheller Creative Casey Naylon Karen Torres Times Publishing Company

Advertising Sales

Design, Production & Printing

Patty Welther 814/833-3200 pwelther@mbausa.org Printing Concepts Inc. printcon@erie.net

ON THE COVER: Ernst Conservation Seeds President and Founder Calvin Ernst stands in a field of beardtongue outside Meadville, Pennsylvania. Ernst Conservation Seeds is marking its 50th year in business in 2014. For full story, see page 12. Mission Statement The Manufacturer & Business Association is dedicated to providing information and services to its members that will assist them in the pursuit of their business and community interests. – Board of Governors Manufacturer & Business Association 2171 West 38th Street Erie, Pa. 16508 814/833-3200 or 800/815-2660 www.mbausa.org © Copyright 2014 by the Manufacturer & Business Association. All rights reserved. Reproduction or use of editorial, pictorial or advertisements created for use in the Business Magazine, in any manner, without written permission from the publisher, is prohibited. Unsolicited manuscripts cannot be returned unless accompanied by a properly addressed envelope bearing sufficient postage. The magazine accepts no responsibility for unsolicited manuscripts or artwork. The Business Magazine and Manufacturer & Business Association do not specifically endorse any of the products or practices described in the magazine. The Business Magazine is published monthly by the Manufacturer & Business Association, 2171 West 38th Street, Erie, Pa. 16508. Phone: 814/833-3200 or 800/815-2660.

August 2014 > www.mbabizmag.com > 3

Business Buzz GANNON PLANS NEW CENTER FOR BUSINESS INGENUITY A landmark building in the heart of Erie’s central business district will be transformed by Gannon University into a Center for Business Ingenuity. The building, located at 900 State Street, will house the University’s College of Engineering and Business, the Small Business Development Center (SBDC) and the Erie Technology Incubator (ETI), creating a setting for collaboration between regional businesses, and university students and faculty. The project is expected to expand over a few years, with ETI being the first to transition into the new building at the end of 2014. Gannon’s Dahlkemper School of Business will follow soon after with the SBDC expecting to join as the final entity transitioning to the new integrated location. For more information, visit www.gannon.edu. PLASTIKOS & MICRO MOLD ANNOUNCE MAJOR ISO 7 CLEANROOM EXPANSION Micro Mold Co., Inc. & Plastikos, Inc. in Erie recently announced a major facility and equipment expansion in order to

satisfy the growing production demand from its global medical device OEM customer base. The facility expansion will comprise more than 17,000 square feet total of additional state-of-the-art space at Plastikos, with the heart of the medical expansion being an ISO 7 (Class 10,000) injection molding cleanroom that will accommodate eight (8) brand new medical molding machines. Plastikos’ medical expansion also will include a separate ISO 7 assembly and packaging lab, as well as corresponding medical production support departments (for example, maintenance, toolroom, quality, general office and meeting room space, etc.). The new ISO 7 cleanroom will be one of the largest Class 10,000 cleanrooms available in the injection molding industry. Plastikos’ total production capacity is projected to increase by more than 30 percent once the medical expansion is fully equipped and staffed, which, in turn, will create significant new customer, project, and employment opportunities over the coming years. The target completion date for the project is slated for first quarter 2015. Plastikos is a custom injection molder that works closely with its sister company,

LECOM’S NATIONAL ECONOMIC IMPACT NEARLY $600 MILLION Erie’s Academic Health Center, led by the Lake Erie College of Osteopathic Medicine (LECOM), is not only a highly innovative medical education system that includes the nation’s largest medical college by enrollment, but it is also a catalyst for economic growth nationally and in the states and communities that host its campuses. In 2013, LECOM’s national economic impact was more The Lake Erie College of Osteopathic Medicine located on West than $593 million, an increase Grandview Boulevard in Erie, Pennsylvania. of 80 percent compared with the college’s national economic impact of $328.8 million in 2009, according to a comprehensive study conducted by Tripp Umbach, a nationally recognized consulting firm. The dramatic growth in LECOM’s impact is largely due to a number of factors, including steady growth in academic programs, enrollment, and number of employees, as well as significant new construction and renovation projects. In addition, LECOM’s 3,800 Doctor of Osteopathic Medicine (DO) and 1,300 Doctor of Pharmacy (PharmD) graduates are generating more than $7.37 billion in economic activity and support or employ more than 49,000 workers. LECOM graduates working mainly in primary care annually contribute to $684 million in health-care cost savings by assisting with preventive care practices. For more information, visit www.lecom.edu. 4 < www.mbabizmag.com < August 2014

Micro Mold, on high precision mold design and fabrication, engineering, and production services for small, tighttolerance applications. For more information, visit Plastikos & Micro Mold at www.plastikoserie.com. ERIE INSURANCE CLIMBS 39 SPOTS ON FORTUNE 500 FORTUNE magazine has ranked Erie Insurance (ERIE) No. 416 on the 2014 FORTUNE 500 list of largest American companies based on total revenue. In 2013, ERIE ranked 455. “Our customers know that if they need us, we’ll be there for them with reliable financial protection and compassionate, prompt customer service,” said Terry Cavanaugh, president and chief executive officer of Erie Insurance. “Our continued presence on the FORTUNE 500 reflects not just the efforts of a single year but the achievements we’ve built over decades of service.” Erie Insurance made its initial debut on the FORTUNE 500 in 2003. According to A.M. Best Company, Erie Insurance Group, based in Erie, Pennsylvania, is the 14th largest homeowners insurer and 12th largest automobile insurer in the United States based on direct premiums written and the 18th largest property/casualty insurer in the United States based on total lines net premium written. The Group, rated A+ (Superior) by A.M. Best Company, has nearly 4.8 million policies in force and operates in 11 states and the District of Columbia. Erie Insurance Group is a FORTUNE 500 and Barron’s 500 company. ERIE is recognized by Forbes as one of America’s 50 Most Trustworthy Financial Companies and is also on the list of Ward’s 50 Group of top performing insurance companies, which analyzes the financial performance of 3,000 property and casualty companies and recognizes the top performers for achieving outstanding results in safety, consistency and financial performance over a five-year period (2008-2012). For more information, visit www.erieinsurance.com. HBK CPAS & ACCOUNTANTS NAMED TO 2014 BEST EMPLOYERS IN OHIO LIST Hill, Barth and King LLC (HBK) has once again been named to the 2014 Best Employers in Ohio list.

DEPARTMENTS > Contact: Karen Torres

It is the firm’s fifth consecutive honor, and it is also the seventh time in the past eight years that HBK has been awarded this designation. The difference this year, however, is that HBK has moved up to the 7th spot on the list; a seven-spot jump up from last year’s placement of 14th. The annual list of the Best Employers in Ohio was created by the Ohio SHRM State Council and Best Companies Group. The selections are conducted through a statewide survey and awards program, which was designed to identify, recognize and honor the best places of employment in the Buckeye State. The 2014 Best Employers in Ohio list is comprised of 40 companies. For more information, visit www.BestEmployersOH.com or www.hbkcpa.com. MAXPRO TECHNOLOGIES EXPANDS FACILITIES A 3,000-square-foot expansion was expected to be completed in July at the Fairview, Pennsylvania location of Maxpro

Technologies production and warehouse facility. “Marcellus shale gas activity, as well as other shale activity throughout North America has impacted our business as Maxpro provides hydrostatic test equipment for recertifying the Frac Iron used on hydraulic fracturing of horizontal wells,” said Maxpro’s President Paul Bowser. “Additionally, the need to expand is to provide assembly and warehouse space for some of the newer products introduced over the past two years.”

BUSINESS RECORDS MANAGEMENT LLC ACQUIRES ABC MOBILE SHREDDING, INC. Business Records Management LLC (BRM), a leader in information management, has acquired the document destruction and the related assets of ABC Mobile Shredding, Inc. in Cleveland. According to BRM, the acquisition enhances BRM’s position as a regional leader in the information management industry.

MAXPRO Technologies was founded in 1995 to serve as the exclusive North American distributor for Maximator® liquid pumps, gas boosters and air amplifiers. Since its founding, Maxpro has expanded its product offering to include standard and custom designed pressure systems, as well as a high-pressure valve and fitting line.

Founded in 1986, BRM operates numerous secure facilities in Pittsburgh, Erie, Johnstown and now Ohio and provides information management services to organizations throughout western Pennsylvania, Ohio, West Virginia and parts of Maryland and New York. The company offers a variety of information management services including physical document storage, secure destruction, data tape management, electronic vaulting, data center backup services and document imaging.

For more information, visit www.maxprotech.com.

For more information, visit www.businessrecords.com.

Total square footage of the production/ warehouse area after the addition is approximately 9,500 square feet.

Your needs, our mission. You can’t wait for highly skilled workers to take you ahead of the competition, and The Community’s College can’t wait to provide them. Starting this fall, Porreco College will make your success fast and affordable with job-ready certificate and associate degree programs priced at true community college rates and designed with the workforce needs of your business in mind. Associate of Applied Science in Applied Technology Associate of Science in Business Administration Associate of Arts in Human Services – Social Services Associate of Arts in Liberal Studies Certificate in Customer Relations Management* Don’t see what you need? Contact us to learn about additional programs now being developed or to discuss a customized solution for your business.

porreco.edinboro.edu 2951 West 38th Street | Erie, Pennsylvania 16506 | 814-836-1955 *For more information about our graduation rates, the median debt of students who completed the program, and other important information, please visit our website at porreco.edinboro.edu/crmprogram/disclosures.

August 2014 > www.mbabizmag.com > 5

Have you made the trip to Career Street? Check out one of the busiest sites in town as local employers, educators and non-profits work in partnership to provide career exploration opportunities to Erie County youth. • Workplace tours • Job shadowing • Career speakers • Internships • Mentoring • Career fairs

www.CareerStreetErie.org Follow the signs to to Career Street and help pave the way for a skilled and engaged workforce.

814.464.8614 The Regional Career & Technical Center is a leading provider of quality career and technical training programs for adults. We offer a variety of courses, affordable tuition, convenient class schedules and customized training programs.

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Manufacturing Technologies MEDICAL TECHNOLOGIES

Special Interest welding

6 < www.mbabizmag.com < August 2014

8500 Oliver Road • Erie, PA 16509

Term I classes begin the week of September 1. Register for classes August 4 – 15. Visit www.ects.org/rctc for a complete course schedule or call 814.464.8601 for more information. The RCTC is a division of the Erie County Technical School, an equal opportunity educational institution.

Health Matters

EDITORIAL > By Stephen Perkins, MD

Reducing Non-Urgent Emergency Department Visits Can Improve Cost Savings, Care One persistent driver of unnecessary health-care spending continues to be the use of a hospital’s emergency department (ED) for what is considered routine treatment. This is seen as both a waste of health-care resources and a contributor to rising health-care costs. Although many people agree that using the ED for routine care is wrong, employers must understand that any attempt to change employees’ behavior in this regard will be difficult. A recent study by the Rand Corporation found that 37 percent of all ED visits could be considered “non-urgent.” The definition of non-urgent care may differ, but generally speaking, that statistic indicates that many people are being treated in EDs who could be served as well, or better, in other settings. What Drives Emergency Department Use? In order to encourage change, it is important to understand the factors that drive ED usage. Here are some of the top reasons: • Timeliness. Seeing a primary care physician on short notice is difficult, if not impossible. Going to an ED means being seen – at least initially – immediately. • Transportation. It’s often easier to get to an ED, either by public transportation (hospitals tend to be on bus routes), or even by ambulance. • What’s needed. If the perception is that primary care will be either inadequate or not timely, people will opt for the ED.

• Trust. Hospitals are often trusted facilities, while many outpatient facilities, such as urgent care centers, are less familiar to the public. To counteract those built-in advantages of EDs, employees need to have increased awareness of care alternatives. Reducing non-urgent use of the Emergency Department requires that you engage and educate people on how to choose appropriate care. For instance, employees need to know more about what urgent centers can and cannot provide and why they may be appropriate for certain conditions. They also need to know that primary care can be a viable option. Patients need to use good judgment in deciding whether to go to an ED. They need to learn the signs of serious illness and then trust their instincts. When possible, calling a primary care physician and describing your condition is a preferable first step. If the physician is your regular physician, he or she will understand your health history and can direct you to the most appropriate care. A description of what ails you can help your PCP make a decision on the best course of action. Right Care, Right Setting It is appropriate to go to an emergency room if you notice symptoms that include chest pains, trouble breathing, a head or back injury, persistent bleeding or vomiting, loss of consciousness, poisoning, a major burn or cut, or choking. For other medical emergencies such as a minor sprain,

a small cut, or a sore throat, then treatment is better suited for an urgent care center or a primary care physician’s office. Many physicians now have evening and weekend hours and even if the office is not open, a doctor is on call, day and night. The doctor can listen to your symptoms and knowing your health history can prescribe a course of action. This could include an ED visit, or a visit to an urgent care center. The physician also could schedule an appointment at his or her office, or give instructions on how to treat the problem at home. Employees also need to know that urgent care centers offer many similar services as EDs, such as X-rays and blood tests. For more information about UPMC Health Plan, visit www.upmchealthplan.com. Stephen Perkins, MD, is vice president of Medical Affairs for UPMC Health Plan, one of the integrated partner companies of the UPMC Insurance Services Division. The partner companies offer a full range of insurance programs and products, and include UPMC WorkPartners, UPMC for Life (Medicare), UPMC for You (Medical Assistance), UPMC for Kids (Children’s Health Insurance Program), Special Needs Plans, Askesis Development Group, Community Care Behavioral Health and E-Benefits.

August 2014 > www.mbabizmag.com > 7

Lake Erie College of Osteopathic Medicine

Erie’s Academic Health Center

LECOM Erie

Erie’s Academic Health Center

The Lake Erie College of Osteopathic Medicine is the nation’s largest medical school and the only Academic Health Center among the colleges of osteopathic medicine. With Millcreek Community Hospital and the Clinical Practices of LECOM, the College is the core of an innovative medical education and health care system. This partnership strives to add to the quality of life for our neighbors in bringing total health care to the community by: •

Developing a 218-bed teaching hospital training new physicians and pharmacists in 17 residency and fellowship programs in the region’s largest post-graduate medical training institution;

•

Building a network of clinical practices in Erie County with more than 40 physicians who not only help to meet the health care needs of our patients, but also serve as clinical instructors for our students;

•

Opening one of the premiere medical fitness and wellness centers in the country designed to focus on the total well being of its members;

•

And constructing a new 144-bed senior living center to provide skilled nursing care in a homelike environment and providing a new teaching model for geriatric care.

As LECOM continues its growth at our Erie and Greensburg, Pennsylvania and Bradenton, Florida campuses the College will continue its mission of providing a quality medical education at an affordable price as we prepare the next generation of osteopathic physicians, pharmacists and dentists.

1858 W. Grandview Blvd. /(&20 /(6 -XQH LQGG

Erie, PA 16509

(814) 866-6641

LECOM.edu 30

Legal Brief

EDITORIAL > By W. Patrick Delaney

Landowners Stand to Lose Cash, Rights if Unprepared for Drilling Deals The U.S. Geological Survey has made several estimates of the quantity of natural gas that lies deep below the surface in the Marcellus and Utica shale formations. The estimates vary, but they are all mind-boggling. It’s been said that we are sitting on an ocean of relatively clean burning fuel. In some locations, it feels like a veritable gold rush. However, as with all lucrative opportunities, there are unscrupulous players and caution needs to be taken. First, here is an interesting and underappreciated fact: In all of the countries of the world, with the exception of the United States, the minerals below the ground do not belong to the surface landowner. Rather, the oil and gas belong to the government! Further, in only a few countries is there a private, entrepreneurial, competitive exploration/ drilling industry. Notable exceptions are the United States, Britain, Canada and Australia. In a recent essay in the respected journal Foreign Affairs, energy economist Edward Morse suggests that this private ownership model is what has allowed the United States to leap forward with innovations in discovery, drilling, and development of these resources. In fact, we may eventually be energy independent. But back to the issue of caution. In both Pennsylvania and Ohio, landowners have been approached by agents seeking to organize large contiguous blocks of acreage so that the collective acreage is more attractive to a large developer/ driller. Let’s call them agent/organizers, since their goal is to organize the landowners’ property into a collective block.

In some instances, these people will imply that they will work on behalf of the landowners to secure the best price and royalty for the collective group. Be careful. There have been instances where these agent/organizers have made more up-front money than the landowners by securing fees not only from the landowners, but also from the driller/ developers who, ultimately, acquire the oil and gas rights. Do These Agent/Organizers Owe Fiduciary Duties to the Landowners? A fiduciary is one who you hire to act on your behalf and who the law requires to act with the utmost loyalty. To the extent that the agent/organizer holds a license to broker or sell real estate, that license comes with many duties established by statutes, regulations and court decisions. Generally, these can be summarized as a duty to be transparent, to keep landowners informed, to reveal any conflicts of interest, and to use their best efforts for whoever retains them. Sounds like a fiduciary. If the agent/organizer is a lawyer, he or she is bound by detailed rules of ethics, and would clearly appear to owe the landowner fiduciary duties. This all sounds good in theory, but there is a great deal of money that can be made in these transactions and unscrupulous characters can appear. The contracts that landowners are offered can be very complex; can contain disclaimers; can limit landowner remedies or damages; and it is not always easy to determine the fair price that a landowner should be paid for oil and gas rights.

drillers. Allegations of fraud have arisen and the cases are only now winding their way through the courts. Landowners must take steps to protect themselves. Require full disclosure from any agent / organizer who approaches you. Who is to pay them? For whom do they work? (Do not be satisfied hearing an impressive corporate name — it may be a mere shell.) Are they representing your interests or someone else’s? How and when are you to be paid? How and when can you exit the relationship? Find a lawyer who has experience in this area to review any contract you’re presented. That lawyer should be able to explain to you the details of the proposed transaction so that it is understandable and may also be able to access the resources to determine the fair value of your acreage. For more information on landowners’ rights in drilling deals, contact W. Patrick Delaney at 814/870-7658 or pdelaney@ mijb.com.

W. Patrick Delaney is a partner in the law firm of MacDonald, Illig, Jones & Britton LLP, where he is chairman of the firm’s Commercial Litigation Group. He is also a Fellow of the American College of Trial Lawyers. His practice focuses on issues of business litigation in the state and federal courts throughout western Pennsylvania.

Pending Cases Lawsuits already have begun in both Pennsylvania and Ohio concerning the obligations of agent/organizers and the contract obligations of the developer/ August 2014 > www.mbabizmag.com > 9

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OntheHill

DEPARTMENTS > Contact: Lori Joint

Five Key Factors May Influence Pennsylvania Governor’s Race Charlie Gerow is a nationally recognized leader in strategic communications and media relations. He is the CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm.

Some early polls in the Governor’s race show Democrat Tom Wolf with a lead. But campaigns don’t start at Labor Day anymore and that lead will almost certainly shrink in the hot days of summer. Things will look very different in November than they do now. So, as the race heats up in the days ahead, here are five things to watch — the key factors that will help Tom Corbett win re-election: 1) THE ECONOMY. While the media loves to focus on divisive social issues, those aren’t what drive most voters. They vote their pocketbooks. Governor Corbett’s record on the economy is strong. Unemployment is down dramatically. Tens of thousands of new jobs have been created under his watch. And Governor Corbett has created the conditions, through less taxes and controlled spending, for long-term prosperity for all Pennsylvanians. His message of economic growth and new opportunities will continue to be very attractive. 2) THE WOLF TRAP. Tom Wolf had the good fortune of having the field to himself for a significant part of the Democratic primary season. He spent millions letting people know he drives a Jeep and is a nice guy. But he remains unknown in any real way to the vast majority of voters. They have written on the blank slate the characteristics they want in a governor. But when his views are put under the microscope, there’s a trap. The truth is that Tom Wolf is to the left of the Democrat Party much less the majority of Pennsylvania voters. How well they will respond to high taxes on everything (including a graduated state income tax) and spending schemes that will outrun even his high tax proposals remains to be seen. There’s also the matter of the tangled web of Wolf’s personal and financial dealings. His Democratic opponents raised some questions, most of them unanswered, yet boatloads remain. For example, how can Wolf tell us that we should be paying more taxes when he pays a far smaller federal tax rate than Mitt Romney, whom his fellow Democrats excoriated?

3) BARACK OBAMA. It’s not going to be a good year to be tied to the Obama administration. Nationally, Democrats in tight contests are already distancing themselves from the president. Wolf’s full-throated support for ObamaCare is an exception. If he doesn’t find some room on issues like Obama’s new environmental initiatives that threaten thousands of Pennsylvania jobs, it will be a big advantage for Corbett. 4) HISTORY. For 60 years, Pennsylvania voters have said they want eight years of one Party occupying the governor’s mansion followed by eight years of the other. No governor has lost re-election since we allowed governors to succeed themselves. While there’s nothing in the state constitution that guarantees this pattern, there are several good reasons for it. It’s not merely the “power of incumbency.” Dick Thornburgh nearly lost his re-election bid, Ed Rendell had low approval ratings going into his reelection year and there was “One Term Tom Ridge.” But voters consistently, over 15 elections and six decades, have said they like giving a party eight years to do the job before letting the other team take its turn at bat. 5) TOM CORBETT. They say that the governor has a secret weapon — Mrs. Corbett. She’s a very effective campaigner and her personal touch in early ads clearly helped to put a “human side” on the governor’s campaign. But the best weapon is still the governor himself. He’s won statewide elections half a dozen times, and he remains the all-time Republican vote-getter in a single election. He’s a fighter. He rises to the challenge. He’ll have the money, the right team, and a strong record to run on. When he hits the trail, he’s engaging and tenacious. He may have to run from behind for the early part of the race, but at the finish line he’ll be ahead.

August 2014 > www.mbabizmag.com > 11

50 Years and Still Growing

Dan Dahlkemper of Dahlkemper Architects and Contractors has utilized Ernst’s products for various projects, including Frontier Park in Erie County.

Ernst Conservation Seeds is known for its custom mixes of seeds for wildlife and pollinator habitats, beautification, erosion control, water absorption, and sustainable landscapes.

Ernst Conservation Seeds grows more than 400 diverse crops for conservation, restoration, beautification and energy. The company is also recognized nationally as the largest switchgrass seed producer east of the Mississippi.

Standing in a meadow surrounded by a sea of Penstemon digitalis, Calvin Ernst holds a plant in his hand, much like a professor ready to teach. “See, this is the beard and this is the tongue,” he explains, pinching the hardy, white native perennial to reveal the fuzzy hairs of the stamen. “That is why it’s known as beardtongue.” Ernst is a scholar of seeds, so to speak, most comfortable talking about his business, Ernst Conservation Seeds, while walking among his wildflower and switchgrass fields that line the roadsides just outside Meadville, Pennsylvania. The Crawford County native is happy to share his knowledge about his products, including his favorite, a New England aster, which, he says, is not only “beautiful in the fall” but also an excellent “pollinator for bees and butterflies.” The 73-year-old entrepreneur has weathered the ups and downs of the marketplace and Mother Nature and talks openly about planting and harvesting, and what he calls the “oddball” business of the seed industry — and how he got into it in the first place. “I never planned to be a seed farmer,” he says, cracking a smile. “But I liked the economics of seeds. I like to say that I’m in the business of turning sunshine and rain into money.” Today, with more than 8,000 acres onsite and 200 acres in Florida and contracts with growers as far away as North Carolina, South Carolina and Maryland, the third-generation family owned business is one of western Pennsylvania’s most successful agribusinesses — growing more than 400 diverse crops for conservation, restoration, beautification, energy, pharmaceuticals and consumption. Ernst’s custom seed mixes can be found along highway interstates and landfills, and conservation areas near and far — from Frontier Park in Erie County and the national park system in Washington, D.C., to even the hallowed grounds of the Flight 93 National Memorial outside Shanksville, Pennsylvania. 12 < www.mbabizmag.com < August 2014

The company is also recognized nationally as the largest switchgrass seed producer east of the Mississippi and, in recent years, has become a pioneer in the production of switchgrass pellets for the burgeoning biomass market. “The business has really evolved from where it started,” says Ernst, the company’s founder and president. “Then again, I wouldn’t have stayed with it if it hadn’t.”

A Rich History

Fifty years ago, however, Ernst Conservation Seeds was just an idea waiting to be planted. “We didn’t actually recognize that we were going to be a seed company,” Ernst explains. “But growing things has always been sort of my goal in life. I liked to grow plants.” While studying ag biosciences at Penn State University, Ernst had been working in a greenhouse researching the erosion control plant crownvetch. When Calvin and his brother Luther learned that the Pennsylvania Department of Transportation (PennDOT) couldn’t find anyone interested in growing it, the brothers were up for the challenge. Ernst says they scraped up the seed money and convinced their father, the late Ted Ernst, to plant crownvetch on five acres of the family farm back in Meadville. Notes Ernst, “The fortunate thing was that it projected a profit, when basically it was really hard to get into the agriculture industry without having somebody give you a farm. Crownvetch was profitable enough that you could expand on the basis of the crop.” Luckily, Ernst’s interest in growing crownvetch paid off, and the family enterprise officially became known as Ernst Crownvetch Farms in 1964. According to Ernst, the timing couldn’t have been better. In the mid-to-late ‘60s, development of the interstate system brought with it

About: Founded in 1964, Ernst Conservation Seeds is a thirdgeneration, family owned and operated business located in western Pennsylvania. The company got its start growing seed for roadside re-vegetation. Today, Ernst Conservation Seeds is one of the largest native grass and wildflower seed producers in eastern North America. The Meadville, Pennsylvania-based company grows and harvests nearly 400 naturalized species of seeds, crops and agricultural supplies for various applications including wildlife habitat, wetland mitigation and Conservation Reserve Program initiatives. Headquarters: 8884 Mercer Pike, Meadville, PA 16335 Phone: 800/873-3321 Website: www.ernstseed.com

Inevitably, homeowners wanted to order Ernst’s seed mixes for their own residential uses, including rain gardens, and the demographic soon comprised nearly a quarter of Ernst’s customer base — which it still does today. “People could see the products that we had on the Internet and wanted us to sell to them too,” notes Ernst. “We’ve actually had a lot of activity with homeowners that way.” Ernst Conservation Seeds President and Founder Calvin Ernst (right), with daughter Robin, president of Meadville Land Service, and his son Andy Ernst, vice president of Ernst Conservation Seeds at the company’s new $1 million refrigerated warehouse in Meadville. Not pictured are Marcia Ernst and Michael Ernst, vice president.

an increased demand for roadside re-vegetation and, subsequently, a growing demand for crownvetch. Ernst’s company flourished, buying its present-day, 180-acre farm and headquarters on Mercer Pike Road and hiring employees to harvest and clean the seeds. “Early on, we were successful enough that we attracted the attention of a company in Michigan that wanted to make a private equity investment in our company,” Ernst recalls, explaining the family’s decision to partner on the purchase of a 640-acre farm in Nebraska. “It actually turned out being a lesson learned in that there’s no use producing more than you can sell.” Within three years, the partnership dissolved and the Ernsts were forced to sell the Nebraska land and reorganize the business back in Pennsylvania. Back at home, however, they became pioneers in crownvetch seed production and experts in growing plants in barren areas exposed by road construction and strip mining. Even in the 1980s when crownvetch lost its value, Ernst began growing large volumes of no-till corn in existing crownvetch fields. The nutrient-rich soil from the crownvetch generated high yield crops and, eventually, Ernst began rotating his fields on this premise.

In recent years, the company has turned its focus to product mixes that will benefit wildlife and, specifically, pollinator habitats for honeybees, which has become a major initiative supported by both the president and Congress. Andy Ernst, Calvin’s son and a major advocate for pollinator conservation, has been an influential figure in the movement. In May 2014, he was called to Washington for a roundtable discussion about creating more native habitats for pollinators on corporate campuses and even highway rights-of-way under the Pollinator Protection Act, also know as the Highways BEE Act. “Pollinators were a natural fit for us,” he says. “We were creating pollinator habitats for years and didn’t realize it. The interesting thing about pollinators is that you are building the foundational structure that pretty much all wildlife and meadow wildlife is going to survive on. The pollinators are key to food for songbirds and other species that rely on those areas. It’s not just about bugs. It’s about birds and bees.”

Business Approach

The longevity of Ernst Conservation Seeds as a successful agribusiness speaks volumes to the company’s business approach, management and staff of 80 employees, who work at Ernst’s Meadville headquarters in marketing, sales, production and processing, in addition to its harvesting operations. >

A New Path

The transition to native seeds, such as deertongue for reclamation, marked a major transition for Ernst and his company. And that was just the beginning. Soon, the company planted its first switchgrass seed because of the wildlife value to strip mine and reclamation seed mixes. Ernst eventually began shifting acreage from grain and crownvetch production to native flowers and grasses — a trend that many government agencies were just starting to embrace. “Once we started growing the native and more diverse seeds, we didn’t want to market ourselves as crownvetch,” he says. As Ernst began growing Niagara big bluestem, he felt it was finally time for the company to better reflect its shift to native seeds, officially becoming Ernst Conservation Seeds in 1994. The name change, coupled with the federal mandates for wetland mitigation, drove business along the East Coast — Maryland, Virginia, the Carolinas — enabling Ernst to work with various public agencies and highway departments, becoming the go-to expert for bioengineering of soil stabilization.

The company has perfected the art of cleaning, processing and packaging the seeds, storing their products in a new $1 million refrigerated warehouse. The temperature is kept at a cool 50 degrees with 50-percent humidity.

August 2014 > www.mbabizmag.com > 13

is working with the NEWBio group from Penn State to study energy crops, and how much energy it takes to grow them. “Those kind of studies, such as the ecological value of switchgrass to energy production, well, I hope will sell switchgrass,” Ernst nods with approval.

Future Opportunities

Ernst can handle any array of custom mixing requests. The company’s largest bags of seed weigh approximately 50 pounds.

While Ernst and his wife Marcia are still active in the company, their children oversee the company’s day-to-day operations. Vice Presidents Andy and Michael Ernst are heavily involved in the seed and biomass business while daughter, Robin, is president of Meadville Land Service, a full-service mobile restoration company that specializes in the construction, restoration, and mitigation of streams and wetlands, as well as native planting, seeding, and the installation of bioengineering material. “Their grandfather and I gave them, particularly Robin, an enthusiasm for growing things,” says Ernst. “They helped me farm all their life, as soon as they could be out on tractors or pulling weeds, or whatever.” For Ernst, this passion for planting is a key component of the company’s success, as well as customer satisfaction — adapting to what their customers want, whether it’s seed mix or a specific kind of seed. For instance, many homeowners use the company’s standard mixes, while landscape architects may request custom mixes depending on the need — such as wildlife habitats, beautification, erosion control, water absorption, or sustainable landscapes that are LEED compliant (Leadership in Energy and Environmental Design). Ernst believes in delivering a high level of customer service — understanding the customer’s objective and consulting with them on the right mixes for their needs, everything from telling them how to repair the site and how to spread the seed, to what kind of maintenance it needs. “That’s what keeps people coming back to us,” says Ernst. “And they’ve told us so.”

Throughout its history, Ernst has always looked for new opportunities to grow the company, from enhancing its product line to expanding their applications. When President George W. Bush introduced the idea of creating biofuels from switchgrass back in 2006, an idea proposed by Dr. David Bransby at Auburn University, the seed for biomass had been planted at Ernst Conservation Seeds. By 2008, Ernst started researching the materials and launched his own operations. Michael Ernst, vice president, recently spearheaded the construction of Ernst Biomass, a 10,000-square-foot biomass pellet manufacturing facility that produces 10,000 tons per year of switchgrass pellets. “Our products are used by the oil and gas industry as an industrial absorbent,” says Calvin Ernst. “And we are in continuous production.” The company is even researching how to use its switchgrass to create cellulosic ethanol and convert it to fuel. “We’re in the intermediate phase, but there’s a lot of enthusiasm about it,” says Ernst. It’s this enthusiasm and pioneering spirit that have made Ernst a respected pioneer in not only agribusiness and academia, but also as a local businessman. “My dad’s always been very involved, right from the early days, with the Farm Bureau and trying to make sure that this region is represented in what was important and what we needed to make this area grow,” says Andy Ernst. “His push to look for new opportunities for this region, especially with the bioenergy potentials and other things; hopefully, if we were to make this a go, this wouldn’t be just us doing the production. It would be something that other people could actually get involved in, if this ever went large scale. This is something that we would not be looking to accomplish on our own. You’re talking tens of thousands of acres to truly turn into a viable industry in the region.” One could say it’s this kind of vision that has kept Ernst Conservation Seeds going — and still growing — after 50 years. For more information, visit www.ernstseed.com

All this wouldn’t be possible, Ernst acknowledges, without a highquality product. The company has perfected the art of cleaning, processing and packaging the seeds, now storing them in a new $1 million refrigerated warehouse. Ernst also utilizes third-party testing to assure that its products meet their stringent standards. “One of the things that I was always cognizant of is that I had a quality product,” Ernst says. “And I think one of the hallmarks of our business is to have high quality, whatever kind of seed.” Ernst is passionate about plants, and his work with academia, government and homeowners has given the company a deep knowledge base and incentive to learn. The company has about 10 interns and partners with a number of major universities and their agriculture schools — Allegheny College, Penn State, Cornell and Rutgers, to name a few, on research. For example, students at Allegheny helped design the comparative absorption of the company’s biomass — in other words, comparing switchgrass pellets to wood pellets and how fast they absorb moisture, water and oil. Presently, the company 14 < www.mbabizmag.com < August 2014

In recent years, the Ernst family has entered new markets. Founded in 2008, Ernst Biomass is a manufacturer of solid biomass pellets, converting switchgrass into an industrial absorbent material.

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August 2014 > www.mbabizmag.com > 15

HR Connection STUDY: COMPANIES LOSING MONEY DUE TO SKILLS GAP Considering the fact that more than half (54 percent) of employers currently have open positions for which they can’t find qualified candidates — and 35 percent of all employers have positions that stay open for 12 weeks or longer — those costs can add up quickly and have broader implications for business performance. CareerBuilder’s latest study on the effects of the skills gap on the U.S. labor market was conducted online by Harris Poll from October 17 to November 6, 2013, and included a representative sample of 1,025 employers, 1,524 job seekers and 205 academics nationwide. The study finds that 60 percent of employers are concerned about the costs associated with delays in filling open positions, with one in four stating they have experienced losses in revenue as a result. Employers also reported compromised productivity and work

quality and a rise in voluntary employee turnover among other consequences: • Lower morale due to employees shouldering heavier workloads – 41 percent • Work does not get done – 40 percent • Delays in delivery times – 34 percent • Declines in customer service – 30 percent • Lower quality of work due to employees being overworked – 30 percent • Employees are less motivated – 29 percent • Loss in revenue – 25 percent SURVEY: WORKERS NEED ROOM TO GROW It’s no secret that happiness is important in the work force — happier employees are more productive and are less likely to look for work elsewhere. In fact, a study for the Journal of Labor Economics shows that happy workers are 12 percent more productive than those

reported as “not happy.â€? With that in mind, a survey conducted on behalf of Rasmussen College set out to find which industries have the most satisfied workers. Here’s what they found: • Wholesale Trade – 87 percent satisfied; • Legal Services – 83 percent; • Hospitality – 83 percent; • Arts, Entertainment, Sports & Recreation – 82 percent; • Banking / Finance / Insurance / Accounting – 79 percent; • Government & Civil Service – 79 percent; and • Business/ Professional Services / Management Consultancy – 77 percent. The majority of jobs in the “high satisfactionâ€? industries require additional education. Other determining factors included job security, work-life balance, flexible hours, location and the ability to do what you love.

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DEPARTMENTS > Contact: Stacey Bruce

Court Decision on Same-Sex Marriage to Impact Group Health Plans in Pennsylvania U. S. Middle District Judge John Jones overturned Pennsylvania’s 1996 Defense of Marriage Act on May 20, 2014. This act prohibited gay marriage and also banned recognition of gay marriages performed in states that have legalized it. The U.S. Supreme Court struck down the federal Defense of Marriage Act (DOMA) in 2013. Pennsylvania’s group health plans will be impacted by these actions. Insured plans, if issued in the state of Pennsylvania, will have to treat samesex spouses, legally married in the Commonwealth or any other state recognizing same sex marriage, the same as all other spouses covered under the plan. Although the insurance carrier cannot force a group to cover

spouses, if spouses are covered then same-sex spouses must be included in the definition. ERISA, which governs self-funded plans, usually preempts state law. Therefore, it is unclear yet as to how self-funded plans will deal with the issue. It may come down to litigation in the court system. It may be important for such plans to review the definition of “spouse� in their plan documents. Plans must also take into consideration any children or step children of the union, which will fall under the title of dependent and as a result, be able to be covered. As in any case, the group should consult with their legal counsel to evaluate any liability risks when deal-

ing with covering spouses, same-sex or not, as well as how the plan deals with domestic partners, same-sex or not. Additional guidance is sure to be received in the near future. For more information, contact me at 814/833-3200, 800/815-2660 or psmith@mbausa.org.

Patty Smith is the director of Employee Benefit Services at the Manufacturer & Business Association.

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ƌŝĞ 'ŝǀĞƐ ŝƐ ďƌŽƵŐŚƚ ƚŽ LJŽƵ ďLJ͗

Joe Holody

814.454.1000 x 126

Director of Convention Marketing, Sales & Services jholody@visiterie.com visiterie.com/meetingplanner VisitErie major sponsors:

18 < www.mbabizmag.com < August 2014

ΨϮϬϬ͕ϬϬϬ WƌŽͲZĂƚĞĚ DĂƚĐŚ͊​͊

AT PENNSYLVANIA’S ONLY DIOCESAN UNIVERSITY, YOU’LL FIND: •

A distinguished, Catholic university education ranked 11th in the northeast region for affordability in U.S. News & World Report’s “Great Schools at Great Prices”

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Nearly 100 undergraduate and graduate degree programs in the most sought-after areas of interest

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Small class sizes with a 14:1 student-to-teacher ratio

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Very competitive scholarships and generous financial aid packages, including grants to graduates of Catholic high schools enrolling directly from high school

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Dynamic and dedicated faculty and staff who love what they do

SCHEDULE A VISIT BY CALLING 800-GANNON-U OR VISITING GANNON.EDU TODAY!

HR Q&A WHAT IS CONSIDERED A QUALIFIED EDUCATIONAL ASSISTANCE PROGRAM ACCORDING TO THE INTERNAL REVENUE CODE? In order to be considered a qualified educational assistance program, which is nontaxable income to the employee, certain requirements must be met under Internal Revenue Code Section 127: • Must be a written plan; • May be for graduate or undergraduate courses; • Dollar limitation of $5,250 per calendar year; and • Must not discriminate in favor of highly compensated employees. The courses are not required to be job related. However, in general, courses related to sports, games or hobbies are only covered under Section 127 if they are required as part of a degree program. HOW DOES A COMPANY ESTABLISH A TUITION ASSISTANCE PROGRAM? A company must establish a written

20 < www.mbabizmag.com < August 2014

plan to assist employees financially for approved educational courses — graduate or undergraduate, professional certifications and classes to prepare for professional certifications. Any type of course, certification, class or anything covered under such a policy must usually be pre-approved by Human Resources. An approved course of study is typically defined as a course, degree program or professional certification that maintains or improves skills in the employee’s present job or a job to which the employee could likely/reasonably be promoted or transferred. However, it does not have to be job-related in order to be nontaxable. Training that is necessary to perform or improve a job (for example, forklift training and certification or attending a seminar or conference) would fall under training, not the educational assistance program. Under this policy an employee may be reimbursed a designated percentage for

each approved course or professional certification, and related expenses (such as tuition, books, supplies, equipment necessary for class, but not tools or supplies which employee may keep after the course is completed), up to $5,250 per calendar year. Reimbursement of any amount over $5,250 is considered taxable income according to IRS regulations. The policy must not discriminate in favor of highly compensated employees. A policy may designate the approved institutions of higher learning often defined as technical or trade schools, accredited colleges and universities. In addition, when suitable courses are not available locally, or when an employee’s work schedule limits his/ her method of study (or if otherwise approved by the company for legitimate business reasons), the company may grant approval for enrollment in certain e-learning and correspondence courses.

DEPARTMENTS > Contact: Stacey Bruce

Employers Increase Educational Opportunities to Help Workers Confront Financial Challenges More than 60 percent of employers believe their employees face more personal financial challenges today than they did five years ago, according to a new survey from the International Foundation of Employee Benefit Plans. In response to these challenges, employers are offering financial education programs to their work force to increase their ability to manage their income and plan for retirement. Additionally, employers are recognizing the value of customizing their educational offerings to meet the unique needs of their work force. While traditional programs, such as retirement planning benefits, investments and savings are the most common offerings, the findings show that employers are beginning to move beyond these typical offerings to better reach their participants.

The report also found that most employers would rate the financial savviness of their work force as “medium to poor” and their workers ill-prepared for retirement. Employers also recognized how employee financial issues can have a significant negative impact on job performance, particularly affecting employee stress levels and the ability to focus in the workplace. Accordingly, nearly 40 percent of employers say they feel a responsibility to educate their employees on financial issues and help them become financially literate managers of their money. Additional findings from the survey included: • Half of all organizations have experienced an increase in demand from participants for financial education in the past five years.

• More than one-third of organizations offering financial education have just started offering this training in the past five years. • The two most commonly cited financial challenges affecting employees were trouble saving for retirement and credit card/ other debt. For more information, contact me at the Association at 814/8333200 or 800/815-2660.

Stacey Bruce is the director of HR Services at the Manufacturer & Business Association.

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dŽ ůĞĂƌŶ ŵŽƌĞ͕ ĐŽŶƚĂĐƚ LJŽƵƌ Et/Z ŝƐƚƌŝĐƚ DĂŶĂŐĞƌ ƚŽĚĂLJ͊ ;ĚĞƚĂŝůƐ Ăƚ ǁǁǁ͘ŶǁŝƌĐ͘ŽƌŐͿ

August 2014 > www.mbabizmag.com > 21

Events 2014 Bike Rally // Erie, PA JULY 16, 17, 18 & 19 The eighth annual Roar on the Shore® bike rally was presented by the Manufacturer & Business Association, major sponsors Budweiser, Country Fair/Citgo, Harley-Davidson of Erie, Indian Motorcycle, Industrial Sales & Mfg. Inc., Jagermeister, Kawasaki, Off-Road Express, PNC, Ridg-U-Rak Inc., Rocket 101, Russ Brown Motorcycle Attorneys, Toyota, Zippo, as well as the City of Erie and more than 45 area business sponsors. For complete photo coverage and information on the 2015 rally, visit www.roarontheshore.com.

Roar 2014 kicked off with the Faith and Freedom Bayfront Ride: A Ride with the Sisters of St. Joseph of Northwestern Pennsylvania. Proceeds of the four-day rally benefited St. Patrick’s Haven, a homeless shelter run by the Sisters and their Associates.

Sister Mary Fromknecht, SSJ of St. Patrick’s Haven was one of several Sisters who enjoyed this year’s Faith and Freedom Bayfront Ride.

Sister Phyllis Hilbert, SSJ is all smiles on the back of Bill Hilbert Jr.’s bike.

More than 5,000 bikes gathered at Presque Isle Downs & Casino for the annual bike parade, sponsored by Toyota.

Marlene Mosco, regional president of PNC Bank, waves to the crowd. PNC sponsored the Faith and Freedom Bayfront Ride on Wednesday, as well as Friday night’s John Kay & Steppenwolf concert on the Country Fair Main Stage.

Grand Marshal Danny “The Count” Koker waves to the crowd as he leads thousands of bikers down State Street. Koker and his band Count’s 77 then rocked The Hub as the Thursday night headliners on the Country Fair Main Stage.

Rebecca and Bill Hilbert, vice chairman of the Manufacturer & Business Association and chairman of the Roar on the Shore Board of Directors, greet 2014 Grand Marshal Danny “The Count” Koker.

Erie Mayor Joe Sinnott presented Roar a proclamation on behalf of the city.

Organizers estimate that between 100,000 and 125,000 people came out to support the four-day motorcycle rally, which generated an economic impact of more than $20 million.

22 < www.mbabizmag.com < August 2014

Dee Snider performed at Saturday’s headline concert, sponsored by Russ Brown Motorcycle Attorneys, on the Country Fair Main Stage.

Madison Rising, nationally known for their patriotic performances, kicked off the Roar rally, during the Wednesday night concert sponsored by Marquette Savings Bank on the Country Fair Main Stage.

Bikers flocked to get a glimpse of the Zippo car from the Bradford-based company.

Legendary rock icon John Kay brought the “Heavy Metal Thunder” to Erie, during the John Kay & Steppenwolf concert sponsored by PNC.

Joe Askins announces the winning ticket for the Indian motorcycle raffle, donated by Indian Motorcycle of Erie. Askins also raffled a Kawasaki Ninja, courtesy of Off-Road Express.

Rally goers enjoyed even more live music at the Jagermeister Stage on North Park Row. The Cab owners Bob and Natalie Burns cooked up their world-famous pig roast for bikers at the new Covered Bridges of Ashtabula County Ride.

Destiny Schick was crowned 2014-2015 Miss Roar on the Shore on Saturday night.

Former Pittsburgh Steelers wide receiver Louis Lipps made a guest appearance at the rally.

Rally goers lined the streets for a stunning stunt show by Team No Limit, sponsored by Off-Road Express.

Miss Pennsylvania Amanda Smith is surrounded by Miss Roar on the Shore contestants and Miss Roar 2013-2014 Natalie Coleman. Smith’s appearance was sponsored by Country Fair/Citgo.

Erie Mayor Joe Sinnott drew the winning ticket for the Harley bike raffle, sponsored by Sue and Kelly Lapping of Harley-Davidson of Erie.

Tim Smith of the hit TV show “Moonshiners” also made a special appearance at the rally, courtesy of Off-Road Express.

Business Magazine Account Executive Patty Welther (right) presents a Roar prize pack to Michelle Wescott. Wescott’s name was drawn from more than 75 new subscribers who signed up to receive the digital edition of the magazine at www.mbabizmag.com. August 2014 > www.mbabizmag.com > 23

People Buzz CANCER CENTER FOUNDATION NAMES NEW DIRECTOR Lisa Louis has been named director of The Regional Cancer Center Foundation. The purpose of the foundation is to raise funds to support the work of The Regional Cancer Center. Charitable contributions to The Regional Cancer Center Foundation help ensure the future of sophisticated cancer care close to home in Erie. Louis earned a bachelor’s degree in public relations from Miami University in Oxford, Ohio and a master’s degree in communication studies from West Virginia University. She has served a variety of communication capacities at The Regional Cancer Center since 1992, most recently as director of Professional and Community Relations. BEAUMONT WELCOMES NEW REGIONAL SALES MANAGER Todd Bresson has joined Erie-based Beaumont Technologies, a global plastics engineering leader, in the role of regional sales manager for Michigan, Indiana and Ohio. Bresson holds a degree in plastics engineering technology from Ferris State University. Before joining the Beaumont team, he worked in technical sales for plastic material suppliers and operated his own consulting business where he provided process training for injection molders. Bresson’s responsibilities at Beaumont include technical sales and engineering support for Beaumont clients in his region and throughout the nation. HAND AND UPPER BODY REHABILITATION WELCOMES NEW THERAPIST Katie Froehlich, OTR/L has been hired as an occupational therapist for Hand and Upper Body Rehabilitation Center in Erie. 24 < www.mbabizmag.com < August 2014

Froehlich recently completed the Evelyn J. Mackin Hand Therapy Fellowship at The Philadelphia Hand Center where she received specialized training in hand and upper body therapy. Prior to her fellowship, she worked as an occupational therapist at the Rehabilitation Institute of Chicago. Froehlich is a graduate of Mercyhurst Preparatory High School and Gannon University. NATIONAL MARKETING RESEARCH AWARD PRESENTED TO LOCAL CEO Colleen Moore Mezler, president and chief executive officer of Moore Research Services, Inc., a full-service research company in Erie, has been awarded with the Marketing Research Association’s Honorary Lifetime Membership Award. The purpose of the Honorary Lifetime Membership Award is to recognize a lifetime commitment of outstanding individual service to the Marketing Research Association (MRA) and the marketing research profession. The award was presented in front of hundreds of researchers from around the world at the 2014 MRA Insights and Strategies Conference held in June in Chicago. Moore Mezler currently is the youngest recipient. The MRA was founded in 1957 and is the leading and largest association of the opinion and marketing research profession, which delivers insights and intelligence to guide the decisions of companies providing products and services to consumers and businesses. Moore Mezler is a current member of the MRA and was among the first people in the United States to receive MRA’s Professional Researchers Certification. She served as president of the organization in 2007-2008, and in 2009 received the Marketing Research Association’s Distinguished Service Award. MACDONALD ILLIG PARTNERS RECOGNIZED AS 2014 SUPER LAWYERS MacDonald, Illig, Jones & Britton LLP in

Erie announced that partners Roger H. Taft, W. Patrick Delaney and Craig Murphey have been selected as 2014 Pennsylvania Super Lawyers. Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high-degree of peer recognition and professional achievement. The selection process is multi-phased and includes independent research, peer nominations and peer evaluations. Taft is a principal trial lawyer at MacDonald Illig and serves as co-chair of the firm’s Labor & Employment practice group. He concentrates his practice on employment litigation, including employment discrimination and wrongful discharge cases, and complex commercial litigation. Delaney is a trial attorney and chair of the firm’s Litigation Department. He has experience litigating a wide variety of matters, from shareholder disputes to personal injury. Murphey has been honored as a Pennsylvania Super Lawyer in each of the past four years. He is a trial lawyer, regularly handling a wide variety of civil cases. KNOX ATTORNEYS RECEIVE FAVORABLE IRS RULING The Internal Revenue Service has published a favorable Private Letter Ruling (201422007) based on a request submitted by two attorneys from Knox McLaughlin Gornall & Sennett, P.C. — Thomas C. Hoffman II and Nadia A. Havard — on behalf of a client. Attorneys Hoffman and Havard were presented with a trust plan prepared by another attorney, the tax implications of which were ambiguous. Using their skills in

DEPARTMENTS > Contact: Karen Torres

a case of first impression before the IRS, Hoffman and Havard successfully presented the IRS with convincing arguments to rule in favor of the taxpayers, resulting in the exclusion of all assets of the trust from federal estate tax for more than 100 years. As noted in Howard Zarisky’s Estate Planning Update 06/15/2014, Volume 14, No. 08, “The IRS approved the allowance of the GST tax annual exclusion under Code Sec. 2642© for separate shares held for each of the transferor’s great-grandchildren in a single trust, where no gifts had been made to any shares other than those held for the great-grandchildren. PLR 201422007 (May 30, 2014).”

Hoffman concentrates his practice on closely held business planning, business succession planning, implementation of sophisticated estate and trust planning, administration of complex estates and trusts, and the tax consequences of these matters. Havard concentrates her practice on tax law, estate planning, estate administration and business law. LOCAL MANAGED IT SOLUTIONS EXPERT MAKES AMAZON’S BESTSELLER LIST Cathy Szymanski, director of WOW of Szymanski Consulting, Inc. in Erie, has joined a select group of America’s leading experts to co-write the book titled, The Business

Owners Guide To I.T. and All Things Digital: 22 Critical Facts Every Business Must Know To Maximize Their Company’s Efficiency, Security, Employee Productivity and Profits. Released on May 15, All Things Digital hit No. 9 overall on Amazon.com and No. 1 bestseller status in six additional Amazon.com categories: Computers and Technology, Computer Science, Networking, Information Systems, Networks, Protocols and APIs, and Software and Engineering. The book features strategies on maximizing efficiency, security, employee productivity and profits from some of the world’s leading entrepreneurs. Szymanski contributed a chapter titled “Customer Service,” which discusses and clarifies expectations from vendors.

August 2014 > www.mbabizmag.com > 25

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