HOUSING MARKET, CONFIDENCE UP THE COMEBACK AT 10 RITTENHOUSE SQ.
HOW AN ARCHAEOLOGIST BECAME A RESTAURATEUR
A JOURNAL OF BUSINESS AND POLITICS
ASSESSING THE FALLOUT FROM A BRUISING, STORMY ELECTION SEASON Despite billions of dollars and endless, often conflicting, polls, not much has changed as incumbents prevail in some rather nasty campaigns.
SOMETHING WAS MISSING ON THE STATE BALLOT TUESDAY’S RESULTS SHOULD NOT CHANGE PLANS FOR SUCCESS TWO PERSPECTIVES ON THE FIRST AMENDMENT RegionsBusiness.com $2.00 U.S.
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8 NOVEMBER 2012
First Look at Election Storm’s Wreckage
How Small Business Can Win Every Election
! The dust is still settling, but President Barack Obama won a second term. What that means for the country and the GOP remains to be seen.
! Forget about Tuesday’s winners. Small business owners can take important steps that will ensure success no matter who wins at the polls.
Obama Win Defies Logic Given the president’s economic record, columnist Charlie Gerow is left scratching his head over President Obama’s win. !
Casey Holds Fitzpatrick Off Smith Wins Again ! Despite recent polls showing an extremely tight race, incumbent Sen. Bob Casey sailed to another term.
! Incumbent Rep. Mike Fitzpatrick won a closely watched 8th District race that turned into a nasty affair.
Dems Sweep Row Offices ! Kathleen Kane will be Pennsylvania’s first female (and first Democrat) attorney general.
Digging Wine and food How archaelogist Jill Weber ended up with two of South Street’s hottest spots. !
Two Penn Center-Suburban Station
Rittenhouse Sq. Comeback Story
In little more than a year, 10 Rittenhouse Square went from a sad story buried in debt to a coveted downtown address. What was started couldn’t be finished. They had to “hit the reset button.” !
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1900 Arch Street is a premier mixed use development project in the Logan Square section of Philadelphia. Scheduled for completion in Fall of 2013, the project will feature 280 luxury apartments, private parking, and 16,333 SF of ground floor retail.
32 REGION’S BUSINESS
1900 Arch Street
PRESIDENT AND PUBLISHER James D. McDonald EDITORIAL DIRECTOR Karl M. Smith ASSOCIATE EDITOR Terrence Casey
Located just steps from City Hall, Suburban Station features some of the premier retail locations in the city. Availabilities exist from 900-2,700 SF with neighboring tenants including McDonald’s, Dunkin Donuts, Au Bon Pain, and TD Bank.
CONTENT TEAM Brandon Baker, Emily DiCicco, Victoria
Marchiony CONTRIBUTORS John Scanlon, Judy Curlee, Michael Jacobs,
Rebecca Savedow, Timothy Holwick, Don Lee ADVERTISING DIRECTOR Larry Smallacombe DIRECTOR OF BUSINESS DEVELOPMENT Jim Bauer ACCOUNT MANAGER Rachel Sollberger
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8 NOVEMBER 2012
Sandy’s Visit Leads to a Humbling Week
Karl Smith is the Editorial Director for Region’s Business. You can contact him at email@example.com.
We didn’t go overboard in preparing for the arrival of Hurricane Sandy, but we did prepare. As we do with most storms, we set out sandbags along the garage and at the end of the driveway. We stocked up on some nonperishables and made sure all the flashlights had fresh batteries. We even rented a portable campingsize generator to make sure we could keep our fish alive in their aquariums. Sandy didn’t leave much rain, so the sandbags appeared a waste of time, time that would have been better spent stacking firewood or getting more nonperishable food. Because when PECO said power could be out for up to a week, they were apparently talking about our neighborhood. Almost six full days went by
before the power finally went back on in our corner of the world. That meant several chilly nights spent sleeping in a mummy bag on a camping cot next to the fireplace. Getting my son off to high school (which opened a few days before the power returned), then fed after football practice before scurrying off to a jazz ensemble audition, those sorts of things proved difficult. But difficult turned to humbling and the humility stuck around a long time. The little generator gave out after Day Two and we resorted to running an extension cord from the aquarium to a power inverter in my truck. I dispatched my wife and daughter to my in-laws, who were blessed with never losing power during Sandy’s visit. The details are a blur, but the
message was clear - you are not in control and be thankful for what you have. Because as bad as things got, we were not living on the New Jersey shore where hundreds of homes simply disappeared, nor were we in the parts of New York City where it would be weeks before power returned. And then there was the unintended blessing of the storm. The lack of power meant an end to the relentless stream of robocalls and shameless television ads about yesterday’s election. I checked our Verizon voicemail box when power returned and found three messages, all prerecorded political pitches. And our first two “live” calls were robo-calls. Likewise, the first three ads we saw on TV were attack ads. When I tell people we haven’t
really watched any prime time television for the past decade, the reaction is usually either sympathy or shock. My response is simple, we don’t feel like we’ve missed anything. The same is true for our post-Sandy week without power. The political machine raged on without us and I don’t feel like we missed a thing. The blowhards kept blowing, the talking heads kept talking and, in the end, none of them said anything that really mattered. Sandy left us humbled, but in some ways thankful. We were able to approach Election Day with less shrieking still ringing in our ears. Guess it takes 940 miles of hurricane-force winds to displace billions of dollars worth of political hot air.
What you do makes you who you are. Let’s create a plan that helps continue all the good you do in your life.
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Life Insurance. Retirement. Long-Term Care.
8 NOVEMBER 2012
Lincoln Financial Q3 Income Tops $400M Lincoln Financial Group, based in Radnor, Pa., reported November 1 that its net income for the third quarter of 2012 had risen to $402 million from $153 million in the third quarter of 2011. “Our positive third-quarter results reflect the many actions we continue to take to increase earnings per share and return on equity,” Dennis R. Glass, president and CEO of Lincoln Financial, said in a statement. Bolstering the strongerthan-expected news, the insurer highlighted an 18 percent increase in retirement plan services deposits, in addition to announcing that it has repurchased 4.2 million shares of common stock for $100 million.
Plans Unveiled for Instagram Part of New Paoli Station
Subaru Vehicle Sales Up 30 Pct. in October
SEPTA has launched a photo stream as part of its new Instagram-centric marketing campaign “I SEPTA Philly,” encouraging riders to share what riding SEPTA means to them. The transportation authority is giving riders the chance to have their photos shared through the photo application, including the hashtag “iseptaphilly” and captioning their photo with why they ride SEPTA. The most captivating submissions will receive prizes that include SEPTA passes, concert tickets, tickets to 76ers games and tickets for the Blue Mountain Ski area.
SunGard Data Systems Inc., a software and technology company located in Wayne, Pa., reported a loss on decreased revenue for its third quarter, down 6 percent to $1.03 billion from where it was during the third quarter of last year. The company lost $279 million, largely attributed to a $385 million non-cash write down of goodwill from its Availability Services business. The loss contrasts to a previous operating income of $63 million.
old-world style of its current station, which is built around an inaccessible parking lot. The train station will feature improved pick-up and drop-off areas, more parking for commuters, ADA accessibility and improvements to surrounding roadways. The station will be built in what was formerly Amtrak’s Paoli rail yard, with the exact location to be decided after gaining feedback from three varying on-the-table design plans.
Survey: Consumers’ Outlook Brighter Increasingly, consumer outlook is becoming brighter, with a Deloitte annual holiday survey highlighting that 50 percent of surveyed consumers expect the economy to improve in 2013 — an increase from 33 percent in 2011. Additionally, 37 percent of consumers reported they will spend less during the upcoming holiday season this year, the lowest the number has been since 2006. Twenty-eight percent of consumers said they will shop during Black Friday this year.
SunGard Data Loses $279M
SEPTA’s most heavilytrafficked regional rail station is about to get a makeover following 11 years of discussion, as the company has at last unveiled the beginning stages of its two-year design process. The transportation authority plans to build the Paoli ITC, a more modern and easilyaccessed station that directly contrasts with the
Lingo Voyager The Voyager 7 from Lingo, one of the leading handheld translator companies, is a must-have for international business travel. The Voyager 7 translates and says more than 1 million words and 66,000 travel phrases in 20-talking languages including Chinese, Japanese, Korean, Dutch, German, French, Arabic, and Greek. The device also offers a voice memo/recorder, New Oxford American Dictionary, world time in 360 cities, and 8 travel games, including Sudoku. List price is around $200.
Creating Value “The Science of Success” delves into the success behind the Koch companies from the pen of Charles Koch himself. In his book, Mr. Koch explains the successful development of Koch Industries as a result of his unique business philosophy, Market-Based Management. “In a very thoughtful, creative, and understandable way, Charles Koch explains how he has used the science of human behavior to create a culture that has produced one of the world’s largest and most successful private companies. A must-read for anyone interested in creating value.” —William B. Harrison Jr., Former Chairman and CEO, JPMorgan Chase & Co.
Subaru, which is based in Cherry Hill, N.J., announced on Oct. 31 that its vehicle sales have increased by 30 percent for the month of October, triggered by a 650 percent increase in sales of its Impreza line. Sales of its redesigned Impreza vehicles totaled 3,638, a surge from the 486 sold in October 2011. While not as sharp of an increase as with its Imprezas, the company’s Outback wagon contributed to the overall sales increase with a modest sales rise of 14 percent. FOOD
University of Tennessee, Aramark Expand Deal
Center City-based Aramark, which provides dining services to more than 600 college campuses and sports venues across North America, announced October 31 that it has expanded a partnership with the University of Tennessee to supply general concessions for its sports facilities. Aramark had previously been the supplier for the university’s residential life and retail outlets since 1997, and has already worked to expand available concessions at the 102,000-seat Neyland Stadium. SPORTS
City Out of the Running for Hockey D-III Championship Though Philadelphia will play host to the 2014 Division I men’s ice hockey championship, it will not host the Division III final, following a proposal turned down by the NCAA D3 Presidents Council October 31 to include the event during the Frozen Four Weekend at Wells Fargo Center.
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WHO TO FOLLOW
The AppBuilder Not a professional app builder, but need one for your business? Avoid spending the massive dollars to be spent hiring a freelance app developer and opt for the multi-platform TheAppBuilder program instead, which features an easy-to-use Web tutorial on how to use its templates to craft a customized business app for your employees or customers to access either through your website, the various app stores or the at-large Web. The app-creation software, which allows for live updates from a separate mobile phone app, ranges in pricing plans from free to $499. HEALTH CARE
IBX Offers $1M Support to Patient Care Initiative Independence Blue Cross, based in Center City, announced that it will extend its financial support of the Partnership for Patient Care collaborative through 2013 with funding of as much as $1.1 million. Independence Blue Cross had previously funded the partnership program with $500,000 earlier this year. The program, since its 2006 induction, has worked to prevent infections acquired at hospitals, and in the future will work to increase awareness of palliative care and increase the application of evidence-based clinical practices. INSURANCE
Radian Group Boasts Profit for First Time Since 2011 Radian Group had good news on profit for the first time in a year, with its stock price jumping 14 percent to $5.36 November 1, which follows a net income report of $14.3 million calculated after combining losses from change in fair value of derivatives and other financial instruments. It wrote $10.6 billion of new mortgage insurance in its third quarter, CEO S.A. Ibrahim told the Philadelphia Business Journal.
@PhillyPressSec Mark S. McDonald, Press Secretary for Mayor Michael Nutter, former Daily News City Hall bureau chief. “Michael Nutter is hooked up, given final instructions, booties over shoes, helmet camera turned on, staff tells him to go slow.” -- November 2, 2012, before the mayor rappeled down a Center City building.
Housing Market Continues Climb A Prudential Fox & Roach report indicates that the Greater Philadelphia region’s housing market continues to
see an uptick, with the number of days a residential property lingered on the market declining during the first nine months of 2012. Twelve counties in the region benefitted from an increase in the number of houses sold when compared to the same
period in 2011, as sales across the region rose 14.2 percent. Median home sale prices, meanwhile, remain relatively flat, holding at $205,000. The number of days a house stays on the market saw a slight downward trend, slipping from 101 to 99 days.
Penn Medicine Plans Move for Trauma Site
Nutrisystem Names CEO
Penn Medicine’s base of operations for its trauma center will move to Penn Presbyterian Medical Center, according to the Philadelphia Business Journal. A 178,000-square foot building at 38th Street and Powelton Avenue is due to be completed by January 2015, according to the report. The trauma center’s current base of operations is at the Hospital of the University of Pennsylvania campus. ENERGY
Penn Virginia Posts Loss Penn Virginia Corp., headquartered in Radnor, Pa., posted what it considers a disappointing increase in losses in its third-quarter report, losing $32.6 million in total — up from $6.7 million during this same period last year. Revenue for the third quarter came in at $77.7 million, down from $83.4 million during the third quarter of 2011.
Horsham-based Nutrisystem, Inc. announced in a statement this week that Dawn M. Zier will be the company’s new president and CEO and will serve on the Board of Directors. She replaces Joe Redling, who is stepping down as president and chief executive officer and resigning from the company’s board of directors. Ms. Zier was most recently president of Reader’s Digest Association’s international business and was responsible for $750 million of revenue and a team of 1,000 employees across Europe, Asia Pacific, and Latin America. “Dawn’s experience and accomplishments fit our requirements perfectly, as she has led Reader’s Digest Association’s transformation to a customercentric business model, built new products and developed new revenue streams in the digital arena, and demonstrated a clear ability to manage costs and drive efficiencies to deliver strong financial results,” Mike Hagan, chairman of the Nutrisystem board of directors, said in a statement. Email business news tips to Brandon Baker at firstname.lastname@example.org
Official Twitter account of the 55th governor of New Jersey. Husband and proud father of four. Working to bring real reform to the Garden State. “When it comes to getting things done, I don’t care what party someone is in. The responsibility I have is much bigger than politics.” -- October 31, 2012 RESTAURANT
Wursthaus Schmitz Popular South Street German cuisine shop Brauhaus Schmitz opened its doors to customers at Reading Terminal Market with its new Wursthaus Schmitz location. Despite the name change, the shop will provide all of the affordable European delights offered at its hallmark location, courtesy of chef Jeremy Nolen.
Continental Old City Stephen Starr’s Continental Old City is selling local liquor, derived from either Philadelphia Distilling, Art in the Age or Cooper Spirits, for $4 through November for “Local Spirit Month.”
8 NOVEMBER 2012
Greenwood Gaming, owner of Bensalem’s Parx Casino (seen above), is seeking a Category 2 gaming license in Philadelphia. SUBMITTED
BY THE NUMBERS
Officials Blame Sandy for Drop in Slots Revenue
Parx Casino Decrease from October 2011 to October 2012
SugarHouse Casino Decrease from October 2011 to October 2012
Harrah’s Philadelphia Casino and Racetrack Decrease from October 2011 to October 2012
Presque Isle Downs and Casino (Erie, Pa.) Decrease from October 2011 to October 2012
Tax revenue generated by slot machine play in Pennsylvania casinos last month.
Superstorm Sandy kept would-be gamblers out of casinos in October, leading to a 4.4-percent drop in slot machine revenue compared to October 2011, officials said. The slots generated $188.4 million last month, a decrease of about $9 million from the previous year, according to the state Gaming Control Board. Last year’s month included five Saturday’s which also contributed to the decline. This was the fourth time since Pennsylvania’s first casino opened six years ago that slot machine revenue decreased, according to the Associated Press.
Parx, Maryland Casino Owners Jointly Seek License in Philadelphia Greenwood Gaming and Entertainment Inc. and The Cordish Companies — owners of Parx Casino and Maryland Live!, respectively — announced November 2 that they will jointly seek a Category 2 gaming license in Philadelphia. The partnership, named “Stadium Casino, LLC,” will develop a “Las Vegas quality” hotel and casino at 800 Packer Avenue, currently the Stadium Holiday Inn. The 200,000-square-foot site is expected to include 240 rooms; an entire floor dedicated to a casino that will boast 125 table games and 2,000 slot machines and a parking garage consisting of 2,500 spaces. The partnership will allow the project to move forward entirely using its own cash equity.
8 NOVEMBER 2012
Hospitals Settle Merger
VitaminSpice, MicroVita Sign License Agreement
Williams Form Moving to Iron Bridge Business Center
Vineland, N.J.-based South Jersey Health System Inc. and Underwood Memorial Health System, which operated the Woodbury, N.J. hospital of the same name, announced November 1 that they have signed a final merger agreement. “Since signing our definitive merger agree-
ment at the beginning of this year, SJH and UMH have focused on how merging our two organizations would improve the health and well-being of our communities,” said Chet Kaletkowski, SJH president and CEO in a company statement. Merger discussions began in May of last year.
BPG Leases 1.7M Square Feet Yardley-based private equity real estate fund manager BPG Properties Ltd., has completed more than 1.7 million square feet of new leases and renewals for the third
quarter. About 110,000 square feet came from local leases, including 32,526 square feet at Ellis Preserve in Newtown Square, for My Alarm Center.
Wayne-based VitaminSpice, Inc. announced November 2 it has signed a comprehensive Product Licensing Agreement with MicroVita, LLC for sale, marketing and distribution of VitaminSpice’s vitamin infused Spice Products. The amount of the initial payment for the agreement was not disclosed. VitaminSpice sells vitamin-infused spices created using a microencapsulation process that keeps vitamin properties locked inside, even when heated, allowing products to retain their full flavor and nutritional value. FOOD
Rita’s, Hershey Collaborate Trevose, Pa.-based Rita’s Italian Ice announced the launch of a new holiday flavor, York Peppermint. Dark chocolate pepper-
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mint flavored milkshakes and sundaes will be available for purchase online and in stores through December 31.
Williams Form Engineering Corp., a company that manufactures concrete forming hardware and accessories, rock and concrete anchor bolts and post tensioning systems is moving from the building it has occupied for the past 15 years in Phoenixville, Pa. to a new building they are having constructed on three acres at the Iron Bridge Business Center in Collegeville. After searching for a space that would accommodate specific requirements such as a 60-foot wide clear space for cranes, the company recruited entered a $2.5 million deal with Gorski Engineering, which owns Iron Bridge on the construction project, slated for completion early next year.
8 NOVEMBER 2012
DEALBOOK HEALTH CARE
Jefferson, RightCare Partner To Reduce Patient Readmission Thomas Jefferson University Hospital announced November 2 that it will be partnering with RightCare Solutions, Inc., an evidence-based technology organization specializing in hospital discharge planning and readmission management with the goal of improving patient care transitions and reducing readmissions. Jefferson will be employing the Discharge Decision Support System’s pointof-care platform that identifies patients who need post-acute care referrals upon admission, which enables hospital staff to optimize patient care throughout the length-of-stay. “We look forward to our role in helping to reduce readmissions across the entire hospital with our D2S2 platform,” RightCare Co-Founder and CEO Eric Heil said in a statement.
PREIT Expands Ownership at Gallery Paramus, N.J.-based Vornado Realty Trust announced recently that it has entered into an agreement to sell 907 Market St. to Philadelphia-based Pennsylvania Real Estate Investment Trust for $60 million. If finalized by the end of the year as planned, the acquisition will give PREIT virtually full control over a three-block stretch of Market Street, enabling the company to pursue the redevelopment of the Gallery it has been planning
VWR International Acquires Lab3 Radnor-based VWR International, LLC, a leading global laboratory supply and distribution company announced November 2 that it has acquired Bristol, UKbased scientific laboratory supplies distributor Lab3 Limited. VWR International has more than 8,000 associates globally and reached worldwide sales in excess of $4.1 billion in 2011. since it began purchasing properties on Market Street in 2003. The Ninth and Market property currently houses a Kmart, but the discount retailer’s lease expires in 2014 and no plans for the space were disclosed.
PREIT owns a number of indoor shopping malls along the East Coast, nine of them in the Greater Philadelphia region, including Cherry Hill Mall, Willow Grove Park, Plymouth Meeting Mall and the Gallery at Market East.
Sheetz Names CEO At the start of the next fiscal year, Sheetz Executive Vice President of Finance and Store Development Joe S. Sheetz, will advance into the position of President and CEO.
8 NOVEMBER 2012
Businesses, State Respond in Sandy’s Aftermath BY THE NUMBERS
Most recent death toll. 106 in the United States, two in Canada and 67 in the Caribbean
Possible total economic damage, according to Eqecat
4,000 Red Cross workers in states struck by Sandy.
National Guard members who reported to assist in storm cleanup
Blankets sent to Staten Island, Coney Island and the Rockaways
Gallons of gas supplied by the government to the region
Customers who lost power at the peak of the outages CNN.COM
THE NATIONAL GUARD
Though Philadelphia narrowly avoided serious damages from Hurricane Sandy, its aftermath still wreaks financial havoc amongst those across the metropolitan region. As a result, government agencies and businesses have been responding accordingly.
The Response from Harrisburg Following the hurricane’s impact on November 1, Governor Tom Corbett made a repeated formal request for reimbursement for local, county and state agencies burdened with the cost of storm preparations and response. “We don’t have clear numbers on how much money has been spent, but we’re looking at emergency preparedness costs in excess of $10 million,” wrote Gov. Corbett in an initial letter to President Obama. Acquired aid would be spent alleviating costs related to debris removal and protective measures put in place before Sandy made landfall on October 29. Taking further action, Gov. Corbett made it
publicly clear through WE DON’T HAVE CLEAR NUMBERS ON HOW a November 1 press MUCH MONEY HAS BEEN SPENT, BUT WE’RE release that PennsylLOOKING AT EMERGENCY PREPAREDNESS COSTS vania homeowners will not be forced to pay IN EXCESS OF $10 MILLION’ deductibles on insur— GOVERNOR TOM CORBETT, IN A LETTER TO PRESIDENT OBAMA ance claims stemming from the storm. declare that Sandy “could have been worse.” A standard deductible under insurance Though the city itself fared fairly well policies with specific hurricane and tropical under the circumstances, with the worst of storm claims ranges from 1 percent to 5 perthe storms impact coming from 340 downed cent of a property’s insured valtrees and the loss of power from 65,000 PECO ue, increasing by 5 percent this customers, suburban counties and surroundyear, according to the Insurance Information Institute. ing regions didn’t fare quite as well. More than 170,000 homes in Montgomery County lost power, and Atlantic City took a The Response financial beating from the storm that could from the City cause long-term tourism troubles, with parts of its boardwalk devoured by the storm and Readily available its minimally-damaged casinos estimated to to the press and have lost $5 million for each day closed from tweeting a frenzy of the storm. “stay home” alerts, Attempting to reach out a helping hand Mayor Michael to a devastated New York City, Mayor NutNutter stepped out following the storm to ter, according to the Philadelphia Inquirer,
8 NOVEMBER 2012
stepped in at the last minute to offer Philadelphia as a one-time host for the now-canceled New York City Marathon. Had the offer been accepted, 40,000 New Yorkers could have been jogging through the streets to the â€œRockyâ€? steps of the Philadelphia Museum of Art. Mayor Nutter responded on Twitter following questions of how the city would have been able to manage the event in such a short window: â€œLetâ€™s have a little more confidence in ourselves â€” we can do big things well!â€? SEPTA, making a customer service effort, offered credits to customers affected by the transit authorityâ€™s two-day suspension during the storm. Holders of TransPasses received the credit when turning in their current passes for a new weekly or monthly pass. Monthly pass credits consisted of a $5.50 refund; with
a $6.50 credit received for a weekly pass and a larger sum of $15.25 returned for an â€œanywhereâ€? pass. Compounding its customer service effort, SEPTA announced on November 3 that it would loan 30 buses to assist New Jersey Transit operations from New Jersey
into New York City. â€œLoan busesâ€? were taken from each of SEPTAâ€™s eight bus districts.
The Response from Banks Bank of America Corp. as well as Wells Fargo Co. and TD Bank made sizeable contribu-
tions to the post-hurricane clean-up effort. Bank of America and Wells Fargo each gave $1 million, with Bank of America giving all of its sums to the American Red Cross and Wells Fargo putting out $250,000 to Red Cross and an additional $750,000 to various other
relief efforts. TD, which is the secondlargest bank in the region, gave $500,000 to the Red Cross. Standing out from the bunch, however, Bank of America has received flak for its cumbersome process of waiving fees for customers affected by Sandy, requiring them to contact the bank directly for the waivers rather than putting in place automatic waivers like counterparts Wells Fargo, TD and Citizens Bank have done. Advising caution, the PA Department of Banking and Securities warned banks on November 1 to be aware of possible fraudulent investment schemes as a result of the storm. Possible schemes were outlined as coming from â€œcoldcalling telephone salespeople, advertisements and internet postings that promote investment pools or bonds to help storm victims.â€?
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8 NOVEMBER 2012
GOP: On to Next Cycle Ironically, the live band was playing “Don’t Stop Believing” as the anchors on the big screen televisions across the room were calling Ohio for President Barack Obama. In Pennsylvania, Republican leaders faced a tough night of electoral losses with a brave face and promised that their party would “dust itself off and come back fighting” for the next cycle two years from now. On a night when Democrats won all five statewide elections and picked up three formerly Republican seats in the state Senate, Gov. Tom Corbett and Rob Gleason, chairman of the Republican Party of Pennsylvania, pointed to the fact that the GOP still controls the governor’s mansion and both chambers of the state General Assembly. “We made a great effort and it was much closer than four years ago, but close is only good in horseshoes,” Mr. Gleason said of the presidential race. If there is a silver lining for the GOP, it is the fact that they added another congressman. Keith Rothfus knocked off U.S. Rep. Mark Critz, D-Pa., in the 12th district to give Republicans 13 of the Keystone State’s 18 congressional seats. “Thank you for all the hard work you did,” Gov. Corbett told supporters at the Hilton Harrisburg hotel. “Starting tomorrow, on to the next cycle.” - PA Independent
McCord Wins By 7 Points
Kathleen Kane beat David Freed by 14 points and carried almost 75 percent of the vote in her home county.
Kane State’s First Democrat, Woman Elected Attorney General Kathleen Kane, a former Lackawanna County district attorney, became the first woman ever elected as attorney general in Pennsylvania on November 6. She was also the first Democrat elected to the top law enforcement position in 30 years. “She is going to do remarkable things,” said Jim Burn, chairman of the Pennsylvania Democratic Party to PA Independent, “she will follow the evidence wherever it takes her, anyone who needs to be held accountable will be held accountable.” A major part of the campaign for Attorney General focused on the handling of the Jerry Sandusky trial. Republican opponent David Freed, Cumberland County district attorney, who termed by Team Kane as Governor Tom Corbett’s “hand-picked candidate,” said that as Attorney General he would review the case if it were necessary. Ms. Kane took a more aggressive approach, demanding a thorough investi- nearly three-quarters of the vote. While Mr. Freed had the big-name gation of Governor Corbett’s involvement support of Gov. Corbett, Ms. Kane was in the case. Ms. Kane won, 56 percent to 42 percent, endorsed by former President Bill Clinton. They were battling to replace Jack with 98 percent of precincts reporting. (Libertarian candidate Marakay J. Rogers Wagner, who is finishing his second term in office and was barred from seeking regarnered 2.3 percent of the vote.) In Ms. Kane’s home county, she won election.
In the race for state treasurer, Democratic candidate Rob McCord defeated Republican opponent Diana Irey Vaughan 52.5 percent to 44. Libertarian candidate Patricia M. Fryman won 3.5 percent of the vote. “I’m grateful and honored to have received the support of so many Pennsylvania voters,” said Mr. McCord. “Over the next four years, we’re going to continue to provide efficient, innovative business approaches in state government. We’re going to build on our record of success, generate more profit for Pennsylvania, and deliver more positive results for Pennsylvania’s seniors, middle class families, students, and all who seek effective, good government.” *Results are with 98.88 percent of precincts reporting*
Depasquale Edges Maher
To counter her opponent’s support from the governor, Kathleen Kane called on former President BIll Clinton.
Democrats won big in Pennsylvania this election cycle, possibly hanging on to President Barack Obama’s coattails. Eugene Depasquale, the Democratic candidate for auditor general, took the position, 49.7 percent to his GOP challenger’s John Maher 46.5. Libertarian Betsy Elizabeth Summers won 3.8 percent of the vote.
8 NOVEMBER 2012
Legislation Requires Employers to Consider City Residents
CITY COUNCIL MATTERS
Timothy Holwick is a freelance writer covering Philadelphia government. Find more coverage at citycouncilmatters.com and follow him on Twitter @CityCouncilBlog. CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
At last week’s Philadelphia city council meeting, a bill was passed that would require beneficiaries of certain types of financial assistance to use the city’s employment referral registry when filling new, entry-level jobs attributable to that financial assistance. Under the bill, the city will compile a “First Source” registry of Philadelphia residents looking for work. When a company receives financial assistance from the city and uses that money to create a new job, it will be required to use this registry to attempt to fulfill their needs. The goal, therefore, would be to leverage city assistance in order to get more city residents back to work. The bill awaits finalization in the form of Mayor Michael Nutter’s signature. The “financial assistance” that will trigger the requirements of the new law is defined as “any grant,
loan, tax incentive, bond financing subsidy for land purchase or otherwise, or other form of assistance in the amount of $25,000 or more.” In order to receive any assistance, a potential beneficiary will be required to enter into a First Source Employment Agreement which will require the beneficiary to use the First Source Registry as its initial source for filling all new, entry-level jobs created directly or indirectly as a result of the financial assistance. The First Source Employment Agreement will function as an initial step to the company’s jobfilling actions. Prior to advertising the position, the beneficiary must provide a description of the job to the city, which will then give it a list of candidates from the First Source Registry. While the company or beneficiary is not required to hire from the First Source Registry, it
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must make a good faith effort to do so, as well as track its compliance with quarterly and annual reports. As Philadelphia residents, via their tax dollars, fuel the sort of financial assistance described in the bill and this hiring practice is designed to help leverage that investment into jobs for Philadelphians. Through testimony from the Commerce Department, the Nutter Administration supported the bill and pointed out that it mirrored successful practices in cities such as Atlanta, Boston, Denver, San Francisco and Washington, D.C. Within Council, 12 members added their name as bill sponsors to demonstrate their support. While the goals of the bill are admirable, it is difficult to enforce a bill that is predicated upon good faith participation by the beneficiaries. The bill carries harsh
penalties for non-compliance such as withholding assistance payments, requiring reimbursements of past assistance, and suspending a beneficiary from participating in city contracts for up to three years. Though harsh, it will be difficult to prove that a beneficiary failed to comply short of completely ignoring the requirements. Despite potential enforceability issues, one can count on the fact that council members will make people accountable for the bill’s requirements when and if the beneficiary finds themselves at a council hearing, for whatever purpose. These types of bills send a positive message in tough times: Philadelphia’s government is working to keep Philadelphia dollars in the city to benefit Philadelphians. In this case, the city tells beneficiaries that if it helps them out, it expects some help in return.
8 NOVEMBER 2012
Obama Victory In Struggling Economy Defies Logic
Charlie Gerow is CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
There’s a nagging question behind Barack Obama’s re-election victory: With the economy in this shape, how did he possibly win? You have to go back three generations to find a president who was re-elected with unemployment so high, let alone the other factors dogging the economy. Even then, Franklin Delano Roosevelt, in the middle of the Great Depression, had economic growth numbers in double digits despite high unemployment. President Obama had an anemic 2 percent growth rate on Election Day. Yet President Obama convinced enough voters that he was the candidate who better understood the plight and concerns of the middle class and was better prepared to do something for them. He did this despite staggering evidence to the contrary. During his first term, middle-class income had fallen significantly, and all of the factors that affect middle Americans in their daily lives were upside down. From gasoline prices to college tuition costs, and from home values to the consumer price index, middle class Americans were not better off than they were four years earlier.
There are a lot of legitimate explanations for Mr. Obama’s win. The Electoral College math was always difficult for the Romney team. They needed the equivalent of an inside straight to prevail. Virtually every battleground state was a necessary takeaway for Mr. Romney, meaning that his task was to win states Mr. Obama carried in 2008. Mr. Obama had plenty of margin and didn’t have to win any states that were painted red four years ago. The Obama team had never stopped campaigning in these states. Their vaunted “ground game” of 2008 simply kicked into a different gear and kept rolling. Although the Republicans put a very solid field program together, it was very difficult to compete with a machine that had been fine tuned for four years. Oldfashioned retail politics is alive and vital in the disconnected technology age, and the Obama campaign made good use of it in key must-win states. None of that explains how Mr. Obama was able to win the message war for the hearts and votes of middle class America. By all accounting of hard data, the economy should have defeated
Barack Obama. But he won. Although it was by a relatively small margin — and there were other factors, like shifting demographics — elections are decided by pocketbooks. And all of the woulda, coulda, shoulda chatter doesn’t answer the hard question of how Mr. Obama was able to take away the best argument against his re-election. The Republican Party has a lot of soul searching to do. They’ll have to do a lot of listening, thinking and strategizing. They’ll need to begin a serious conversation with the American people. At the top of their agenda must be a plan to reconnect with middle America, to speak its language, to feel its pain and to provide solutions that are believable and workable. And they’ll have to put forward messengers that aren’t easily stereotyped as “super rich and out of touch.” Reclaiming their rightful position as the party of the middle class and the promoters of economic growth and prosperity for every person is a vital mandate. If the GOP can do that, 2014 and 2016 will have a lot of additional geography colored red.
8 NOVEMBER 2012
What’s Missing From Pennsylvania’s Ballots?
Eric Boehm is bureau chief for PA Independent, an online political news organization.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
Voters cast ballots for every elected position from President of the United States down to state representatives on Tuesday. But now that the election is over, we’re left to wish and hope the politicians stick to their promises and do what they can to reform the Leviathan. If they do not, there is nothing we can do for at least two years. That’s because there is something missing from Pennsylvania’s ballot: a process called Initiative (and its brother, Referendum), that allows voters to directly make or reject policy by doing what the politicians cannot or will not. At least 36 other states had some form of initiative or referendum on their ballots this Tuesday. But in Pennsylvania, residents get very limited say over policy via the ballot box. Here, voters are given only the chance to weigh in on constitutional amendments (along with local issues like new municipal debt). By the time an amendment reaches that step, it has to be approved by the General Assembly — twice, in consecutive sessions — effectively turning the referendum process into nothing more than rubber stamp for policies already approved by legislators. Meanwhile, residents are left waiting for lawmakers to pass reforms that restrict their own power, pay and patronage. We might as well be waiting for Godot. It’s not so in many other states. Take the Taxpayer Bill of Rights, for example. The so-called TABOR law adopted in Colorado in 1992 limits government spending to a formula of inflation plus population growth. Essentially, the law predetermines the size of the pie that lawmakers have to divvy up in the annual state budget and leaves them the job of deciding only who gets what. Would state lawmakers ever agree to tie their hands in such a way if it was left up to them? People are full of surprises, I suppose, but John Caldera, president of the Independence Institute,
a free market think tank in Denver, once told me that there is nothing on the books in Colorado the politicians hate more than the TABOR law. So how did TABOR became law in Colorado? The only way it could have — it was put in place by the residents themselves, via a ballot initiative. Interested in property tax reform? Lawmakers in Harrisburg have tossed around the idea of changing Pennsylvania’s arcane property tax system since the 1980s, with little success. California, on the other hand, enacted historic property tax reforms in 1978 that reduced taxes by more than 50 percent through — you guessed it — a ballot initiative. What about privatizing the state liquor stores? Lawmakers have been trying to end the state-run monopoly liquor system in Pennsylvania almost since the day it was implemented. That was in 1933, at the very end of Prohibition. Republicans say they want to
take another shot at privatization in 2013, but with all the special interests that profit from the system staying just the way it is, one does not have to be a cynic to think the effort may end in failure. Again. But in Washington State, a similar state-run liquor system was brought crashing down in 2010 when citizens approved a ballot measure to privatize all state-run liquor stores and allow alcohol to be purchased in bulk at places like Costco. Polls consistently show more than 70 percent of Pennsylvanians would support privatizing the liquor store system — if only we were given the chance. Like all activities in the political sphere, initiative and referendum comes with a warning label. It requires that residents stay informed on the issues and handle their ballots responsibly. But if government “of the people” is something to hold sacred, it’s a risk and a responsibility we should be glad to shoulder.
2012 BALLOT INITIATIVES
Same Sex Marriage Voters in Maine, Maryland and Washington elected to legalize same sex marriage in their respective states.
Marijuana Voters in Washington and Colorado elected to legalize recreational use of marijuana. Oregon residents voted down an initiative to regulate marijuana like alcohol. The passage of a Massachusetts initiative legalizes marijuana for medicinal use.
Taxes Voters in Florida rejected a constitutional amendment that limits tax growth to increases in population and inflation. Physician-Assisted Suicide The result of a Massachusetts vote over whether physicians can supply drugs to help patients end their own lives is still too close to call.
8 NOVEMBER 2012
Constable Security on Election Day a Longtime Expense
Issues Arise at Pa. Polling Places
Department of Revenue Releases Updated Data
Lawsuit Would Delay Property Tax Changes
Workers at a Philadelphia polling place were ordered to cover a mural of President Barack Obama during yesterday’s election. They used a few pieces of paper to partially cover the art. Elsewhere in Pennsylvania, a faulty voting machine would not let voters select President Obama. That machine was recalibrated and put back in use.
The State Department of Revenue released figures from the previous month on November 1. Notable figures: Pennsylvania’s General Fund revenue was 3.6 percent higher than anticipated, $2 billion. Yet sales tax receipts and other General Fund tax revenue for October were both below estimates. Tax receipts totaled $755.3 million for October, $2.9 million below estimate, and other General Fund tax revenue was $125.7 million for the month, or $3.2 million below estimate.
HARRISBURG — Election observers are expected to help monitor polling sites on Election Day. They intend to ensure voters are not obstructed and ballots are secure. And so are the constables. For decades, Pennsylvania counties have paid constables to keep the peace at polling places on Election Day. But county and state officials are questioning that expense and may require having constables at polling sites an option, rather than a requirement. And with volunteers willing to help for free, those officials may have a good argument. Constables, who run in political parties, are sworn peace officers with certain powers to arrest and are required to act as security at polling places. But many counties do not have enough constables for every precinct. In that event, constables can appoint deputies to fulfill the role, or the polling place can go without a constable. This security comes at a cost which for some counties is tens of thousands of dollars a year for an average, uneventful election. Instead of paying constables to be on election duty, counties should look to the security that is available. Doug Hill, executive director of the county government advocacy organization County Commissioners Association of Pennsylvania, said modern polling places, like those at schools, have their own security-like guards and restricted entrances, lessening the need for constables. If constables were an option, counties also could rely on local law enforcement, Mr. Hill said. The state’s Local Government Commission released an October 9 report titled “Study of Statutory Mandates Places on Counties and Municipalities” that shows the state laws counties and local governments consider most burdensome. Among its recommendations was making constables optional for counties on Election Day. — Pa Independent
Several hundred Philadelphia realestate owners filed a class-action lawsuit October 26 in an effort to nullify this year’s city budget. The plaintiffs claim that by basing this year’s real estate taxes on inaccurate property values from 2011, the City Council and the legislature have violated tax uniformity protections found in both state and national constitutions. They argue that the current budget forces individuals “to pay taxes which are wholly based upon arbitrary and unreliable property values.” The plaintiffs own more than 1,000 buildings in the city; Gerald S. Kaufman Group, owner of the Terminal Commerce Building, is the lead. CENTER CITY RESIDENTS ASSOCIATION
Mayor Michael A. Nutter walks through Old City with Luke Butler, Chief of Staff to the Deputy Mayor for Economic Development, and Danielle Cohn of the Pennsylvania Convention and Visitors Bureau. Mayor Nutter visited Old City following the launch of Startup PHL, a new initiative to support startups and entrepreneurs in Philadelphia. For more information on Startup PHL, visit www.startupphl.com. CITY OF PHILADELPHIA
CCRA Preparing Annual Report
Report: Oil, Gas Companies Gave Corbett $1.3M in 2010 During the 2010 gubernatorial election, Tom Corbett received $1.3 million from donors with connections to oil and gas, according to the National Institute on Money in State Politics. While in Pennsylvania, it is illegal for corporations to donate to candidates, the Republican Governors Association, a 527 organization, found an exception to that law that transforms unusable money into usable donations. To assist in the process, the RGA created a state PAC to make contributions to candidates, a legal maneuver.
The Center City Residents Association (CCRA), an organization dedicated to improving the quality of life for Center City residents, has spent the year conducting research in order to target its weaknesses and ultimately strengthen itself. It has worked with residents to understand issues most important to them, and hopes to use this information to develop projects that will assist homeowners in the neighborhood. The CCRA will publicize its report after it finishes evaluating and finalizing its plan moving forward.
8 NOVEMBER 2012
Don’t Let Tuesday’s Winner Determine the Success of Your Small Business
Michael Houlihan and Bonnie Harvey, authors of The Barefoot Spirit: How Hardship, Hustle, and Heart Built a Bestselling Wine, started the Barefoot Wine brand in their laundry room in 1986. Learn more at thebarefootspirit.com.
With election coverage ramped up to a fevered pitch many small business owners felt confused and anxious over which candidate will save the day and which will rain death and destruction on our free enterprise system. Here’s a word of advice: Tune out the rhetoric and get back to work. No matter who occupies the White House, entrepreneurial small business owners will have to rely on who we’ve always relied on to be successful: ourselves, our employees, and our customers. When we founded Barefoot Wine brand in 1986, we learned through experience what made a small business successful. By employing innovative ideas to overcome obstacles and create new markets, we made the brand a nationwide bestseller and successfully sold the brand to E&J Gallo in 2005. What’s more, we did it all while four presidents, each with very different governing styles, held the highest office in the land. We are convinced that any company that has a good product or service and gets the basics right will thrive — regardless of the outcome of an election. Here are nine of the basics: Embrace the advantages of being small. While small companies tend to be undercapitalized and unknown, they also have some big advantages over larger competitors. They tend to be more nimble and flexible instead of being mired in bureaucracy. Since they don’t have big siloed departments, they can communicate faster. All of this allows them to turn on a dime in response to market changes and customer demands. Think creatively about marketing. You don’t have to spend a lot of money. When Barefoot was founded, we pioneered what we call “worthy cause marketing” (WCM). We partnered with nonprofit organizations (NPOs) that believed in the same causes we believed in—specifically, environmentalism and civil rights. We donated product at fundraising events, we worked festivals, and we got out into the community to talk about causes we were passionate about. In this way, we gained access to lots of potential customers and gave them a “social reason” to buy Barefoot wine. And in return, the NPOs received donated product and manpower at events, as well as publicity via Barefoot’s distribution channels. Find good people. Make great people. Of course you need to hire well. That means finding people who are not only qualified, but who have foundational qualities you can
WE ARE CONVINCED THAT ANY COMPANY THAT HAS A GOOD PRODUCT OR SERVICE AND GETS THE BASICS RIGHT WILL THRIVE — REGARDLESS OF THE OUTCOME OF AN ELECTION.’ build upon. Barefoot looked for enthusiasm, confidence, honesty and integrity, a willingness to learn, and a sense of humor. But we didn’t stop there—we made sure to provide the environment, encouragement, resources, and flexibility for our people to become their best. We did everything possible to help them live up to their full potential. Use performance-based compensation. Most compensation plans are based on an hourly rate, which is paying for attendance, not necessarily production. Consider offering bonuses based on sales, cost reductions, and customer retention. In other words, give them a financial reason to help the team perform. Grow your business by sharing the wealth. Some business owners want to have it all, but cut off the very folks they need to get what they want. Sharing the wealth allows you to reduce turnover, attract go-getters, and motivate people to produce even more. At Barefoot, we had several salespeople who made more than we, the owners, did—yet when we looked at the efficiencies of scale, the
value of stability, and the increase in sales, we knew we were doing the right thing. Don’t treat information as currency. Let it flow freely. Some companies, especially big corporations, treat information like a coveted commodity. In fact, it’s often used as a type of currency. Do not let this happen. Do whatever you can to engage everyone and keep the information free-flowing. At Barefoot, we made sure all people were getting bonuses on sales, which meant that sharing information and ideas was good for everybody’s paycheck. Listen to your salespeople. Without them, there is no company. Run everything by your salespeople that affects your product and its image. Before you allow a change or “improvement” to the product or the package, check with the folks who have to actually make the sale, overcome the objections, and talk directly to the decision makers and the end users. Establish a positive culture. Company culture has a direct bearing on the survival and growth of a company. Barefoot’s culture was based on two overarching principles: generosity and permission. Our use of worthy cause marketing gave employees a level of satisfaction that went far beyond making a sale—they got to make a difference. And by insisting that people use their imagination to experiment, be creative, and even make mistakes, Barefoot gave them permission to be all they could be. Make sure customer service is an integral part of that culture. The original Barefoot culture was based on the most comprehensive definition of customer service. We viewed it as more of a “service” rather than merely a product. Barefoot could not survive without becoming “America’s Personal House Wine”—meaning Tuesday night wine, picnic wine, beach wine, the wine you kept on hand because it always delivered quality and value. To stay in business, we pulled out all the stops to create a great customer experience. Business owners need to remember something crucial: Governments cannot create. They can make things easier or more, but they cannot build something new and exciting and inspiring. That’s our job — and we should focus on it instead of worrying about things we can’t control. No matter who becomes president, we need to be grateful for the opportunity to have our dreams, bring them to life, provide a good living for our employees, and make life better for our customers. If we can stay focused on that, we’ll be the winners in every election.
RACE FOR THE WHITE HOUSE
8 NOVEMBER 2012
STATE’S 20 EASILY GO TO OBAMA Romney’s last-minute push now looks more like a Hail Mary than an indication that Pennsylvania was ever really in play as a swing state.
BY JOHN SCANLON For all the Democratic nail-biting caused by 11th-hour voter polls that had Mitt Romney breathing down Barack Obama’s neck in Pennsylvania, the president emerged victorious in the Keystone State on Tuesday night without breaking into much of a sweat. Over the weekend leading to Election Day, an advertising blitz and a virtual tornado of campaigning in the state, especially by Mr. Romney, had seemingly leveled the presidential playing field when the latest Pittsburgh Tribune-Review poll declared the race too close to call, with the candidates locked at 47 percent. But it never turned into a long night of vote-counting. In fact, within two hours of polling-place closures in the state, analysts were able to project Mr. Obama as the winner of Pennsylvania’s 20 electoral votes, and he went on to defeat the former Massachusetts governor rather easily, 52 percent to 47 percent, while receiving 2,894,079 votes. Hours later, with his re-election assured, it seemed to be 2008 once again as a rejuvenated Mr. Obama stood at the microphone during his Chicago victory party and pumped up his supporters, not vowing to deliver the “hope and change” of four years ago but instead highlighting his administration’s unfinished business, particularly job growth and the economy, and the need for a cooperative political effort to tackle the nation’s key issues. “Our economy is recovering ... a decade of war is ending ... a long campaign is now over,” he told supporters just after 12:30 a.m. “And whether I earned your vote or not, I have listened to you. I have learned from you. You have made me a better president.” Nationwide, his defeat of Mr. Romney by 2 percentage points - Obama claimed 50 percent of the popular vote - wasn’t as decisive as the wave that swept him into the
White House four years ago, when he thumped Republican challenger John McCain by more than 10 percent of the vote. But Mr. Obama’s success in several battleground states considered critical to Romney’s election hopes - notably Ohio, Virginia and New Hampshire – helped propel him beyond the 270 electoral votes needed to ensure his re-election. His 303 votes surpassed Mr. Romney’s total by about 97 votes. In Pennsylvania, and particularly in the Philadelphia region, the president’s race to a second term mirrored the strong support across the nation from women and minorities. Considering that Pennsylvania last elected a Republican president in 1988, when voters favored George H. W. Bush, Mr. Romney and his campaign strategists figured the candidate faced a tough challenge in a state where Democrats enjoy a registration advantage of about 1.2 million voters. On Tuesday, their hopes of a moderate Philly turnout for Obama never materialized. In fact, according to state election results, a solid turnout in Philadelphia County brought overwhelming support for the president, who amassed 551,070 votes, compared to 90,989 cast for Mr. Romney, and translated to a lopsided advantage of 85.2 percent to 14.1 percent. The Romney camp’s other strategic hope - that the city’s four suburban counties could help bolster his vote tallies - proved to be just as fleeting. According to state
election results, three of those counties and Montgomery - went with Mr. Obam favored Mr. Romney by a mere 1,800 v the unofficial numbers. Elsewhere in the region, Mr. Obama County, by about eight percentage point leaning Lancaster County got behind M vote tally exceeded Mr. Obama’s by abo As the campaign progressed through sylvania voters told pollsters of various c employment, health care, senior issues the stagnancy of middle-class incomes economy seemed a dominant issue wi especially in light of recent labor stati Pennsylvania’s unemployment rate in upward to 8.2 percent. According to The Associated Press, polls conducted around the state ident as a chief concern among six of every 10 key issues. In fact, that was in line with Review poll that reported nearly half of state said economic issues would influe presidential candidate. For both the Romney and Obama ca initially wasn’t regarded as a battlegro because of its Democratic leaning, un lenger earned strong reviews of his pe
nties - Bucks, Delaware Obama. Chester County 800 votes, according to
bama easily took Lehigh points, but conservativeind Mr. Romney, whose y about 20 percent. ough the summer, Pennious concerns, including ssues like Medicare and comes. On Tuesday, the ue with regional voters, statistics showing that ate in September ticked
Press, Election Day exit identified the economy ry 10 voters surveyed on with an earlier Tribunealf of likely voters in the influence their choice of
ma camps, Pennsylvania tleground state, largely ng, until the GOP chalhis performance during
RACE FOR THE WHITE HOUSE
8 NOVEMBER 2012
Feeling Blue How the electoral votes looked in the swing states.
FLORIDA Still too close to call, though leaning to the president.
VIRGINIA The lead changed hands several times, but President Obama emerged with a three-point edge.
OHIO No Republican has ever won the White House without carrying Ohio.
the opening presidential debate in Denver in early October. Emboldened by ensuing polls that showed him slicing Mr. Obama’s lead, including among Pennsylvania voters, Mr. Romney and his senior aides soon declared the state fertile ground for campaign stops and a significant GOP investment in TV advertising. “This is one of those states that came into view right after the first debate,” Kevin Madden, a Romney senior adviser, told reporters over the weekend. “As a result, it just presented a great opportunity. So we’ve seen the state get closer and closer and closer (in the polls).” Pro-Romney groups, including the Republican National Committee, invested about $12 million in advertising in Pennsylvania during the week leading to the election. The Obama campaign spent about a quarter of that for advertising to shore up the president’s own stature in the state. Over the weekend, as he courted voters in all-important Ohio, Mr. Obama dispatched former President Bill Clinton to stump for him during a swing through the state, including rallies at Montgomery County Community College and at the Palestra in West Philadelphia. Mr. Romney, meanwhile, made a personal visit to Bucks County on Sunday night, where some 25,000 supporters showed up at the Shady Brook Farm in Yardley to hear his plans for the economy and job growth. Two days later, however, it was Mr. Obama who put Pennsylvania in the win column.
WISCONSIN A five-point margin meant it wasn’t really close at all.
IOWA Same story as Wisconsin.
COLORADO Almost a four-point edge.
The Obama campaign spent little time in or money on Pennsylvania, focusing on swing states such as Ohio, Florida, Virginia and Wisconsin. The Romney campaign made a late run at Pennsylvania, including a visit to Bucks County by the candidate and a multi-million dollar television ad spend funded largely by super PACs. BARACK OBAMA PHOTO: PAUL KADZIELSKI MITT ROMNEY PHOTO: AUSTEN HUFFORD
NEVADA Almost a seven-point edge.
NEW HAMPSHIRE President Obama won by a bit more than three points.
8 NOVEMBER 2012
U.S. SENATE ELSEHWERE
Democrats, women win big Democrats added three seats to their U.S. Senate majority, but the bigger story was the success of women from both parites.
Democrat Elizabeth Warren unseated incumbent Scott Brown 53.8% to 46.2%, claiming the seat once held by Ted Kennedy.
Once though vulnerable, Democrat Claire McCaskill handily defeated Todd Akin, now infamous for his “legitmate rape” comment, by more than 15 points.
Tammy Baldwin became the first openly gay person elected to the U.S. Senate, defeated former governor Tommy Thompson by more than five points.
Despite Smith’s Spending, Casey Cruises to Senate Win BY MICHAEL JACOBS Philadelphia and the four surrounding counties provided Democratic Sen. Bob Casey the cushion he needed for a comfortable re-election. The Scranton lawyer won a second sixyear term by nearly half a million votes over Republican political newcomer Tom Smith. “The job of putting this country back to work is not yet done, and as a member of the United States Senate who was just re-elected, I know that’s still going to be my No. 1 obligation,” Casey said in a nine-minute acceptance speech at the Scranton Hilton on Tuesday night. “We have a lot of work to do when we go back.” He said that work must start with providing peace of mind to the middle class, “then we can have a lot of debates about what happens to folks at the higher end.” Casey was tired enough during the speech to forget the youngest of his four daughters, Marena, when thanking his family. The Democrat attributed the oversight to all the counting in what appeared to be a tightening race. Two polls in late October, the Pittsburgh Tribune-Review/Susquehanna and Rasmussen, gave the senator the narrowest of leads, 46 percent to 45 percent, and the RealClearPolitics average of polls put Casey ahead by only 5.4 percentage points. That average was 15.3 points as late as Sept. 22, and Casey led by as much as 21 points in a Franklin & Marshall College poll in early June. Franklin & Marshall also had the largest margin among the final polls at 9 points, but that matched the actual voting. “Smith’s peak has been the 45 percent a Republican gets just for showing up in Pennsylvania in a normal year,” RealClearPolitics wrote in an analysis Oct. 30. Sure enough, unofficial results from 9,153 of Pennsylvania’s 9,257 districts (98.88 percent) showed Casey with 2,900,728 votes, or 53.6 percent, to Smith’s 2,417,779, or 44.7 percent. Smith’s support ran about 2 percentage points behind that of Republican presidential candidate Mitt Romney. Smith had the edge in most of the commonwealth but couldn’t overcome a deficit of more than 600,000 votes in Casey’s sweep
overall turnout was down more than 9 percent in the city and 8 percent statewide. “Win or lose tonight, we always knew the challenge ahead of us would be daunting,” Smith said in his concession speech. “But I know Pennsylvania will rise to that challenge because we must. I know that working together we will bring back America, and we will restore her great promise.” Sounding a theme that Obama repeated later, Casey called for voters on both sides “to move forward as one family, the American family, into the future. We’ve got a lot of work to do, but I have no doubt and I have total confidence in our ability to do that in both parties. But it begins tonight in the aftermath of a tough election.” The election wasn’t expected to be tough after Smith, an Armstrong County farmer and former coal-mining company owner, rode his Tea Party connections and business fortune to the Republican nomination despite being a Democrat until 2010 and never holding an elected office higher than supervisor of a small town. But Smith doubled Casey’s spending, THE JOB OF PUTTING THIS pouring about $20 million into a campaign COUNTRY BACK TO WORK that labeled the Democrat “Senator Zero.” IS NOT YET DONE.’ The Casey campaign countered by calling the Republican “Tea Party Tom Smith.” — SEN. BOB CASEY Outside organizations spent more than $2.1 million on pro-Smith or anti-Casey ads and $900,000 on pro-Casey or anti-Smith of Philadelphia, Bucks, Chester, Montgom- ads, the Pittsburgh Tribune-Review reported. Smith threw $17 million of his own money ery and Delaware counties. The incumbent won 86.4 percent of the votes in the city and into the effort to make a name for himself across the commonwealth, and he did not 56.4 percent in the four suburban counties. CNN said black voters’ turnout in Phila- sound like someone ready to write off that delphia exceeded their 2008 turnout in sup- investment Tuesday night. He repeated his campaign calls to repeal port of President Barack Obama, although Obamacare, end deficit spending, defend Pennsylvania coal jobs and “get this economy roaring again.” “I want to make a promise to you: I am ready to continue the fight, day in and day out, until this work is done, but only if you will too,” he said at the Sheraton Station Square Hotel in Pittsburgh. “So we leave here tonight not sad, not angry, not defeated. We leave here tonight with a renewed sense of purpose. We leave here tonight with hope. We leave here tonight with optimism. We leave here tonight knowing we still have Challenger Tom Smith doubled Sen. Casey’s spending, much left to do.” pouring about $20 million into the campaign.
8 NOVEMBER 2012
REGIONAL RESULTS Congress District 1 Robert A. Brady (D) - 85 percent John Featherman (R) - 15 percent District 2 Chaka Fattah (D) - 89.4 percent Robert Mansfield Jr. (R) - 9.4 percent James Foster (I) - 1.3 percent District 6 Jim Gerlach (R) - 57.2 percent Manan Trivedi (D) - 42.8 percent District 7 Patrick Meehan (R) - 59.5 percent George Badey (D) - 40.5 percent District 8 Mike Fitzpatrick (R) - 56.7 percent Kathy Boockvar (D) - 43.3 percent District 13 Allyson Schwartz (D) - 68.9 percent Joseph Rooney (R) - 31.1 percent District 16 Joseph Pitts (R) - 55 percent Aryanna Strader (D) - 38.9 percent John Murphy (I) - 4.3 percent James Bednarski (BFC) - 1.8 percent
State Senator District 1 Lawrence Farnese (D) - 82.4 percent Alfonso Gambone (R) - 17.6 percent District 3 Shirley Kitchen (D) - 100 percent District 5 Mike Stack (D) - 71.6 percent Michael Tomlinson (R) - 28.4 percent District 7 Vincent Hughes (D) - 100 percent District 9 Dominic Pileggi (R) - 55.4 percent Patricia Worrell (D) - 44.6 percent District 17 Daylin Leach (D) - 63.3 percent Charles Gehret (R) - 36.7 percent
Mary Whitesell (D) - 35.3 percent District 146 Mark Painter (D) - 50.4 percent Thomas Quigley (R) - 49.6 percent
District 19 Andrew Dinniman (D) - 57.3 percent Christopher Amentas (R) - 42.7 pct
District 147 Marcy Toepel (R) - 61.4 percent Betty White (D) - 38.6 percent
District 148 Mary Jo Daley (D) - 58.5 percent Mike Ludwig (R) - 41.5 percent
District 13 John Lawrence (R) - 53.4 percent Eric Schott (D) - 46.6 percent District 18 Gene DiGirolamo (R) - 100 percent District 26 Tim Hennessey (R) - 56.7 percent Mike Hays (D) - 43.3 percent District 29 Bernie Oâ€™Neill (R) - 58.4 percent Brian Munroe (D) - 41.6 percent District 31 Steven Santarsiero (D) - 57.7 percent Anne Chapman (R) - 42.3 percent District 53 Robert Godshall (R) - 60.7 percent Mick Wynne (D) - 39.3 percent District 61 Kate Harper (R) - 58.2 percent Jo White (D) - 41.8 percent District 70 Matthew Bradford (D) - 64.8 percent Jim Phillips (R) - 35.2 percent District 140 John Galloway (D) - 73.2 percent Eric David (R) - 26.8 percent District 141 Tina Davis (D) - 72.6 percent Anthony Sposato (R) - 27.4 percent
District 149 Tim Briggs (D) - 65.8 percent Perry Hamilton (R) - 34.3 percent District 150 Mike Vereb (R) - 54.3 percent Kelly Devine (D) - 45.7 percent District 151 Todd Stephens (R) - 59.6 percent Will Sylianteng (D) - 40.4 percent District 152 Thomas Murt (R) - 63.7 percent Ronald Kolla (D) - 36.3 percent District 153 Madeleine Dean (D) - 64.3 percent Nicholas Mattiacci (R) - 34.7 percent Kenneth Krawchuk (L) - 1 percent
District 161 Joe Hackett (R) - 52.9 percent Larry Demarco (D) - 47.1 percent District 162 Nick Miccarelli (R/D) - 100 percent District 163 Nicholas Micozzie (R) - 50.2 percent Seamus Bonner (D) - 49.8 percent District 164 Margo Davidson (D) - 66.9 percent Earl Toole (R) - 33.1 percent District 165 William Adolph Jr. (R) - 63.4 percent Jeremy Fearn (D) - 36.6 percent District 166 Greg Vitali (D) - 63.1 percent Bill Toal (R) - 36.9 percent
District 180 Angel Cruz (D) - 100 percent District 181 W. Curtis Thomas (D) - 100 percent District 182 Brian Sims (D) - 100 percent District 184 William Keller (D) - 100 percent District 185 Maria Donatucci (D) - 100 percent District 186 Jordan Harris (D) - 100 percent District 188 James Roebuck (D) - 93.9 percent Ernest Adkins (R) - 6.1 percent
District 167 Duane Milne (R) - 58.7 percent Rob Broderick (D) - 41.3 percent
Vanessa Brown (D) - 100 percent
District 168 Thomas Killion (R) - 57.5 percent Beth Alois (D) - 42.5 percent
Ronald Waters (D) - 100 percent
District 169 Ed Neilson (D) - 65.4 percent David Kralle (R) - 34.6 percent
District 192 Louise Bishop (D) - 100 percent
District 154 Steve McCarter (D) - 75.7 percent Mark Sirinides (R) - 24.4 percent
District 170 Brendan Boyle (D) - 100 percent
Pamela Delissio (D) - 76.7 percent
District 155 Becky Corbin (R) - 53.6 percent Josh Maxwell (D) - 46.4 percent
District 172 Kevin Boyle (D) - 68 percent Al Taubenberger (R) - 32 percent
District 156 Dan Truitt (R) - 51.9 percent Bret Binder (D) - 48.1 percent
District 173 Michael McGeehan (D) - 100 percent
District 157 Warren Kampf (R) - 51.7 percent Paul Drucker (D) - 48.4 percent
District 174 John Sabatina (D) - 100 percent
District 194 Linda Bateman (R) - 23.3 percent
Michelle Brownlee (D) - 100 percent District 197 J.P. Miranda (D) - 95.6 percent Steve Crum (R) - 4.4 percent District 198
District 175 Michael Oâ€™Brien (D) - 100 percent
District 142 Frank Farry (R) - 100 percent
District 158 Chris Ross (R) - 57.8 percent Susan Rzucidlo (D) - 42.2 percent
District 143 Marguerite Quinn (R) - 61.9 percent Joseph Frederick (D) - 38.1 percent
District 159 Thaddeus Kirkland (D) - 79.6 percent James Schiliro (R) - 20.5 percent
District 178 Scott Petri (R) - 100 percent
District 144 Katharine Watson (R) - 100 percent
District 160 Stephen Barrar (R) - 100 percent
District 179 James Clay Jr. (D) - 100 percent
District 145 Paul Clymer (R) - 64.7 percent
District 177 John Taylor (R) - 57.4 percent William Dunbar (D) - 42.6 percent
Rosita Youngblood (D) - 100 percent District 200 Cherelee Parker (D) - 100 percent District 201 Stephen Kinsey (D) - 100 percent District 202 Mark Cohen (D) - 100 percent District 203 Dwight Evans (D) - 100 percent
8 NOVEMBER 2012
Fitzpatrick Defends Redistricted 8th BY JUDY CURLEE
Republican Mike Fitzpatrick won re-election to Congress after an expensive, and sometimes ugly, campaign against Kathy Boockvar.
Mike Fitzpatrick won another term in the US. 8th District, beating challenger and Doylestown attorney Kathy Boockvar by 58% to 42%, unofficially. The lame duck Congress, currently 241 Republican, 194 Democrat, and after the election, will remain in GOP hands, where Speaker John Boehner will keep a sharp eye on the budget decisions to come. PhillyBurbs.com quoted Bucks GOP chairwoman Pat Poprik as saying, “Someone in our own backyard, someone we know and love is going to be returning to the House of Representatives.” Incumbency played a role in this election, following the pattern of the Philadelphia region, which returned state representatives to Harrisburg, as well as our U.S. Senator, and of course, the President.
And it helped big, in the wake of GOP voters. Sandy’s destruction... Congressman Thirdly, money talks. The contribuFitzpatrick sent out emergency response tions for individuals and super PACs fed information to constituents each campaign, but right away. He is a known, Fitzpatrick had a bigwell-liked entity, having been a ger budget. More than commissioner for ten years, and $1.5 million from then congressman for another THE within and outside the four, who retained his support REDISTRICTING district gave him a big among seniors with the slogan, PEN PROVED financial advantage. “Save Medicare. Vote for Fitz- POWERFUL ONCE The decision by the Democratic Congrespatrick,” appearing daily in area AGAIN.’ newspaper in the weeks leading sional Committee to — SHIRA TOEPLIZ up to the election. withdraw funding Fitzpatrick’s win also resulted REALCLEARPOLITICS from Boockvar had to from the redistricting edge. hurt. “The redistricting pen proved powerMeanwhile, Fitzpatrick could continue ful once again, helping the parties who to air ads, buy full-page newsprint ads, controlled the pen – usually the Republi- mail fliers, and maintain yard and roadcans,” observed Shira Toepliz, the House side signs. All increased visibility and correspondent for RealClearPolitics. inevitability. Nationally, the two major The 8th changed following the 2010 parties spent $1.1 B in congressional Census, adding some more registered races. Here in the Philadelphia region,
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8 NOVEMBER 2012
CONGRESS that contributed to Fitzpatrick’s victory over challenger Boockvar, outspent two to one. According to Philly.com, Fitzpatrick “spent $2.5 million through Oct. 17, the latest federal reporting date, compared with $1.3 million for Boockvar - a sizeable sum for a challenger.” So what does the race mean for the 8th district residents? Lots of economic activity in the short term, and much national attention in the future... As an expensive market, in a tight demographic with a crucial role, its blue collar/ white collar mix, the 8th District will continue to benefit. The PA delegation at 19 is now half what it was at its largest, 36 seats, following the 1910 Census. Yet despite our dwindling population relative to the rest of the nation, PA and its 8th District will stay front and center in campaigns to come. Proof is the visit by Governor Romney in Bucks County, where Mike Fitzpatrick joined him, and the visit by Bill Clinton in Montgomery County, where Kathy Boockvar campaigned, all wooing the voters of the diverse and dynamic 8th U.S. district.
No Change in Majorities
PhillyBurbs.com reports that Tuesday’s loss continues a negative trend for Kathy Boockvar as a candidate, citing that last year, the Democrat was defeated in a race for judge of Commonwealth Court and that she previously lost a bid to become Bucks County register of wills.
Once again, President Obama will have a divided legislature; he will serve with a Democratic Senate and a Republican House of Representatives. While gridlock and lack of compromise plagued his first term, hopefully the branches of government will be better able to reconcile and work through their differences this time around. The Senate remained Democratic, 51 to 44, but lost two seats out of the total 100 spots. West Virginia, Ohio, New York, Virginia, Massachusetts, Rhode Island, Connecticut, Maryland, California, Minnesota, New Mexico and Missouri all went blue. Pennsylvania elected Democratic incumbent Senator Bob Casey over Republican challenger Tom Smith, and New Jersey elected re-elected U.S. Senator Bob Menendez over Joe Kyrillos. Arizona switched from Democrat to Republican, electing Representative
Jeff Flake over Democratic challenger Richard Carmona. On the other hand, states like Wisconsin, Missouri, Virginia, and Connecticut switched from Republican to Democrat. New Jersey re-elected Democrat Bob Menendez over Joe Kyrillos. In the red House, Democrats were not able to secure the 25 seats they would need to get the majority. Instead, Republicans remained in majority, 218 to 215. However, Republicans did lose 22 seats from last session. Notably, Republicans lost in North Carolina’s 8th district, in which Republican businessman Richard Hudson beat incumbent U.S Representative Larry Kissell. Additionally, Utah’s 2nd district switched blue to red, electing Chris Stewart over Democrat Jay Seegmiller. Meanwhile, California’s 3rd district and Maryland’s 6th district, switched from red to blue.
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8 NOVEMBER 2012
WORLD AFFAIRS COUNCIL
Council CEO Named The World Affairs Council of Philadelphia has named Craig Snyder as president and CEO, effective November 1. Mr. Snyder replaces Claudia McBride, who stepped down after 25 years with the council, the last six as president. Mr. Snyder previously worked for the World Affairs Council as program director from 1983 to 1989 and vice president of programming in 1991. Most recently, he was managing partner of Ikon Public Affairs, a Washington, D.C.based nonpartisan government-relations and campaign-consulting firm that he founded in 1997 directly following his service as the late Senator Arlen Specter’s chief of staff.
Vietnam Trips Planned
FOREIGN POLICY RESEARCH INSTITUTE
Institute’s Annual Dinner To Honor Professor With Public Service Award On November 13, The Foreign Policy Research Institute 2012 Annual Dinner will honor Walter Russell Mead with the 8th Annual Benjamin Franklin Award for Public Service at the Westin Hotel in Philadelphia. Mr. Mead will keynote the event, focusing his remarks on America and the World amid Financial Upheaval, Political Transitions, and a Changing Strategic Balance. Mr. Mead is the James Clarke Chace Professor of Foreign Affairs and the
Humanities at Bard College and Editor-at-Large at American Interest Magazine. Previous recipients of the Ben Franklin Award include Henry A. Kissinger, Fouad Ajami, Charles Krauthammer, Robert D. Kaplan, Niall Ferguson, Philip Zelikow and John R. Bolton.
WORLD TRADE CENTER OF GREATER PHILADELPHIA
Finance Workshop To Cover Region’s Trade Finance From November 25 through December 10 the World Affairs Council of Philadelphia will facilitate a trip to Vietnam. Highlights include Hanoi and an excursion to Ha Long Bay; Da Nang, Hoi An, Hue in the North, tributaries and floating markets of the Mekong River Delta in the South. The tour concludes in Saigon, with an optional four-day/threenight post-tour extension to Angkor Wat and Phnom Penh, Cambodia. Spots are filled for this trip, but those interested can reserve a place on the next Vietnam tour with WACP, scheduled for October 2013.
Mississippi River Trip Planned From November 30 through December 11, The World Affairs Council of Philadelphia will facilitate a trip down the Mississippi River to New Orleans aboard the 138-guest Yorktown. Civil War historian James Robertson will narrate the voyage, and guests will have the opportunity to explore the town and battlefield of Vicksburg, as well as the historic town of St. Francisville and Natchez.
The World Trade Center of Greater Philadelphia (WTCGP) will facilitate an “Export Finance Workshop” on November 14 at the ACIN Center Operation, Waterfront Technology Center in Camden, N.J. Participants will meet the region’s leading trade finance lenders and learn how to use financing tools to close or expand export sales. Speakers include Thomas Cummings, Regional Director, Northeast and Mid-Atlantic Region, Export-Import Bank of the United States, Toni Corsini, Regional Manager, Export Solu-
Roundtable, Lecture Tackles ‘The Magic of LinkedIn’ Sales and Marketing Executives of Philadelphia will present “How to Leverage the Magic of LinkedIn,” at the Philadelphia Country Club on Tuesday, November 13 from 7:30 to 9:30 a.m. The event provides a unique roundtable opportunity to learn
from fellow attendees through discussion facilitated by national LinkedIn speaker, Brynne Tillman. Registration is currently open and costs $50.00 for non-members.
MULTICULTURAL AFFAIRS COUNCIL
Executive Director Named The Multicultural Affairs Congress of Philadelphia has named Nicole Johnson-Reece as its new executive director. Ms. Johnson-Reece was formerly the vice president of global
diversity and inclusion for Aramark. She replaces Tanya Hall, who left in September to take a community relations position at Aetna following 15 years with the Multicultural Affairs Council.
CHILEAN AND AMERICAN CHAMBER OF COMMERCE
Chamber Plans Friend of Chile Award Luncheon
tions Group, U.S. Small Business Administration, and Allen Uhler, Director of International Sales, Fluid Rx Inc. Registration is currently open and a single non-member ticket costs $60.
GREATER PHILADELPHIA CHAMBER OF COMMERCE
Chamber to Hold Health Care Reform Seminar On November 12, The Greater Philadelphia Chamber of Commerce will host a free health care reform seminar in the DiBona Room at 200 South Broad Street. Benefit Services, Inc. and
SALES & MARKETING EXECUTIVES OF PHILADELPHIA
several other health insurance providers will educate business owners on the tools available to help them complete and manage 2013 health plans, with a focus on Reform Ready products.
The 15th Annual Friend of Chile Award Luncheon, hosted by the Chilean & American Chamber of Commerce and sponsored by 24 regionally based businesses and organizations will take place on Thursday, November 15 at the Union League of Philadelphia. The event will begin with a Chilean wine tasting and reception, to be followed by a noon luncheon and awards celebration honoring David Schiro, President, Jac. Vandenberg, Inc. with the “Friend of Chile”
award and recognizing Bacchanal Committee of Pennsylvania Academy of the Fine Arts with the “Pablo Neruda” award. Tickets are $150 and registration is open through November 8.
Email chamber news tips to Victoria Marchiony at firstname.lastname@example.org
8 NOVEMBER 2012
Photo by Rebecca Savedow
and, mostly, Syria. I live in Syria for four months a year and really appreciated all the different food, the tastes and styles. So how do you bring together archaeology and food? Food is so very internaHow does an archaeologist bring home the atmosphere from tional and so culture-spefrom faraway lands? For Jill Weber, the answer was food, cific. It’s cerebral and very including an eclectic wine bar and a restaurant that’s heavy on Southern charm. emotional, it’s adventurous and comfortable all An archaeologist by trade, Jill Weber is also at the same time. Everywhere I go, I look for a the person behind the Jet wine bar and Rex wine bar, so it really wasn’t such a stretch. If you’re in Syria four months a year, how 1516 restaurant on 1500 block of South Street. What’s the elevator pitch for your places? do you run your establishments? I haven’t been to the Middle East for a year Jet is my local restaurant for global wines that I bring back from all my travels. It’s all the and a half, but I’ve got a great general manager things you like about travel. Rex is your Old at Rex, so I don’t worry when I’m gone. And World mansion with heartfelt food, where you most of the staff at Jet has been there since the beginning. come to relax with friends. How do you feel about not getting back But restaurants aren’t really your backto Syria? ground, are they? It’s obviously such a mess. I know some [Laughs] ... Actually, I’m an archaelogist and since 1992, I’ve been traveling in Turkey people there and, by the stories they tell, it’s not
COMFORTABLE NEW DIGS
going to end any time soon. It’s not going to be safe for a long time. It’s sad because it’s really such a wonderful country. The Syrians are among the most creative and entrepreneurial people I’ve ever met. Do their circumstances necessitate being entrepreneurial? Oh, definitely. They have to make a niche for themselves, so they innovate a service or product. Then it’s the little details that set them apart. You know, you find a silversmith there that does intricate work, something that sets them apart, and you not only find yourself going back to that person, but telling your friends to go there, too. Rex will be open two years in November. Jet is less than six months old. Did it make sense to open these places during an economic downturn? [Laughs] ... No, definitely not. I think that helped in our decision of where to open. Being in a neighborhood at 15th and Chestnut allows us to attract a lot of return customers. And even when the economy is down, people still like to go out to eat and drink. I think it’s one of the last things they hold on to.
8 NOVEMBER 2012
FINE ESTATES PREVIEW
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8 NOVEMBER 2012
THE COMEBACK AT
RITTENHOUSE SQUARE Financially, legally and physically, the building was a mess. But a new owner and some patient financing have it back in the spotlight. BY REGION’S BUSINESS STAFF Most people saw a mess, literally and figuratively. The building at 10 Rittenhouse Square was visibly in shambles and, in terms of paperwork, even worse off. That’s not what Carl Dranoff saw. The president and CEO of Dranoff properties said “I really admired the property, it’s a trophy with a cherished history.” Senior lender iStar Financial saw the same thing - opportunity. When the complicated paperwork was finally straightned out in the summer of 2011, the two teamed up to bring 10 Rittenshouse back. A quick turnaround might have brought some quick returns, but both Mr. Dranoff and iStar took the long view. And that meant starting all over again. “We had to really hit the reset button,” Mr. Dranoff said. The challenges were many - physical restoration of the property, a sales strategy, a tepid economy - just to name a few. But none of those topped the list. “Our biggest problem wasn’t the building,” Mr. Dranoff said. “Over three years there were numerous ownership changes.
Inside and out, 10 Rittenhouse Square gives no impression of ever having been a building in distress. Developer Carl Dranoff said that he “had to hit the reset button” after taking over the project. Part of the project’s success came from expanded amenities and an aggressive sales strategy. SUBMITTED
8 NOVEMBER 2012
33 The broker community and the buyer community didn’t know what to expect.” That led to the biggest problem. “They lost confidence,” Mr. Dranoff said. “We had to restore confidence.” The key to that, he said, ended up being iStar. “Here’s the good news - iStar clearly was in it for the long haul,” he said. “They were not interested in an auction. They wanted a better return, so they stayed with the property and made a long-term value play.” Cynthia Tucker, senior vice president at iStar, agreed. “It’s a major investment and we plan to continue with it,” she said. “The selling strategy was very specific and we took the approach that we were not going to reduce prices with a goal of preserving and protecting the values, not just for iStar, but for the buyers.” Mr. Dranoff said he had to “reject dozens of low-ball offers.” The payoff has been strong. Ms. Tucker said that in 2011, there were 16 closings on new sales worth $28 million. That has been dwarfed by this year’s totals: 46 deals either closed or under contract worth $73 million. But it took more than just an aggressive sales strategy to bring buyers. “We needed a high level of amenities both in function and size,” Ms. Tucker said. “These were crucial elements in positioning the building at the top of the market.” Mr. Dranoff said the adage of “location, location, location” helped, too. “There’s a bit of a tailwind in downtown Philadelphia,” he said. “The growth of high-end restaurants in downtown Philadelphia has been great. And people feel very secure; people are walking the streets in great numbers.” All part of the comeback.
8 NOVEMBER 2012
Tough Call on Free Speech, Threats
Gene Policinski, senior vice president and executive director of the First Amendment Center. Find out more at firstamendmentcenter.org.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
A white supremacist faces sentencing for soliciting violence against a juror after a federal appeals court in Chicago decided that even though he never openly asked for anyone to kill or harm the person, his online posts were clear enough. The decision is another reminder that although the government cannot successfully prosecute a person, or a court send them to jail, because of mere ideas, the time, place and manner in which a person speaks — or even their intended audience — makes a difference. A three-judge 7th U.S. Circuit Court of Appeals panel on Oct. 23 reversed a federal judge’s decision and said William White’s online calls for the assassination of “everyone associated with” the conviction of another racist, Matthew Hale, were criminal solicitation — and thus not protected speech. The appeals court said White’s comments were not just “loathsome,” which would be protected by the First Amendment, but were such that a reasonable jury could have found the comments to be illegal from “the contents of White’s
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REGION’S BUSINESS A JOURNAL OF BUSINESS & POLITICS
Web site, its readership and other … factors.” In general, for such a threat to be criminal conduct, it has to incite “imminent lawless conduct,” likely to produce violence directly and quickly. The threat also has to be possible to be carried out. Openly wishing someone to be hit and killed by a meteor may be a repellent thing to say, but the speaker has no means to carry it out or incite others to do so. In White’s case, the three appeals judges said White crossed the line into unprotected speech by calling for the assassinations, while publishing the juror’s name, color photo, home address, phone numbers and other personal information. Further, they said, White did so on a site where readers “were not casual Web browsers, but extremists molded into a community by the internet — loyal and avid readers who … know that Overthrow.com identified hateful enemies who should be assassinated.” The appeals court added, “White didn’t have to say harm Juror A. All he had to do and did do to invite violence was to sketch the characteristics that made Juror A a mortal enemy of
White’s Neo-Nazi movement and publish Juror A’s personal contact information.” It also found that although no one person was solicited to injure or kill the juror, posting the information on such a site was “specifically designed to reach as many white supremacist readers as possible so that someone could kill or harm Juror A.” White targeted the juror for being the foreman of a jury that convicted Hale of soliciting the murder of a federal judge. “Fortunately,” the appeals judges noted, “No one took (White’s) invitation.” Nothing about White’s racial smears and violent tone is worth repeating or even reading — but his right to speak in such a manner is protected unless there is strong, unmistakable evidence it’s intended to invite or directly cause violence against an identified individual. In this case, judges at the appellate level disagreed with a judge at the district level and said White’s posts did just that. It’s a good example of how difficult it is — and should be — to criminalize what we do say, let alone what we may invite but don’t say.
8 NOVEMBER 2012
Turning to First Amendment To Help Understand Second David L. Hudson Jr. is a scholar at the First Amendment Center. Find out more at FirstAmendmentCenter.org.
The First Amendment right to freedom of speech and the Second Amendment right to keep and bear arms are usually related only by their proximity in the Bill of Rights. But the connection actually runs much deeper. Courts are using standards from First Amendment law and applying them in Second Amendment cases. The 5th U.S. Circuit Court of Appeals just did this in its Oct. 25 decision in National Rifle Association v. Bureau of Alcohol, Tobacco, Firearms, and Explosives. In this case, the 5th Circuit considered the constitutionality of federal laws prohibiting federal firearms licensees from selling handguns to minors. The National Rifle Association and some 18-20-yearolds challenged the law as violating the Second Amendment. The 5th Circuit used a two-step process in evaluating the Second Amendment claim. First, the appeals court reasoned that it must determine whether the Second Amendment protects the conduct at issue. Second, if the conduct is protected by the Second Amendment, the court must decide which standard of review to apply to the law. The three common standards of review in First Amendment law are strict scrutiny, intermediate scrutiny and rational basis. Strict scrutiny requires the government to
have a compelling government interest, intermediate scrutiny requires a substantial interest and rational basis requires only a legitimate interest. The appeals court found support for this two-step process from First Amendment free-speech law, in which courts often first ask whether certain speech falls into an unprotected category of speech, such as fighting words, true threats, incitement to imminent lawless action, obscenity, child pornography or defamation. “Similar to the first step of our Second Amendment analysis, the first step in analyzing a First Amendment challenge is to determine whether the conduct (i.e. speech) in question is protected,” the 5th Circuit wrote. “In harmony with welldeveloped principles that have guided our interpretation of the First Amendment, we believe that a law impinging upon the Second Amendment right must be reviewed under a properly tuned level of scrutiny.” It is not surprising that courts would use First Amendment analogues in deciding Second Amendment cases. The U.S. Supreme Court has developed an intricate — if less than totally coherent — body of First Amendment free-speech law for decades upon decades. But the Supreme Court has only recently begun developing its Second Amendment jurisprudence.
In District of Columbia v. Heller (2008), the Court ruled that the right to keep and bear arms was an individual right rather than a collective right of a “well-regulated militia.” Then, in McDonald v. City of Chicago (2010), the Court ruled this individual right to keep and bear arms was so fundamental that it also applied against regulations by state and local governments. Recall that the Supreme Court first ruled the First Amendment right to free speech applied to state and local governments as well as federal way back in 1925 in Gitlow v. New York. The Supreme Court referred to First Amendment cases repeatedly in making its Second Amendment decision in Heller. Lower courts hearing Second Amendment cases now must determine which standard of review to apply to various laws restricting the sale, possession or use of firearms. The 5th Circuit determined there was “longstanding, historical tradition” of limiting who possessed firearms and found the federal laws did not violate the Second Amendment. Other courts could reach different conclusions in different Second Amendment cases. But many courts will refer to First Amendment free-speech law and its use of different standards of review. In other words, judges will use the First to understand the Second.
8 NOVEMBER 2012
Finally Time to Put Away Rhetoric, Get Something Done
he day many thought would never come has actually arrived - the day AFTER the 2012 November election. More than a billion dollars have been spent, hours of air time consumed, metric tons of printed materials distributed, countless heated arguments endured. The message of each candidate was, more or less, the same: The other choice is bad. In an era where strong leadership and bold ideas are required, the electorate was not treated to thoughtful discussions or meaningful debate. And not just at the presidential level. Up and down the ballot, candidates for U.S. Senate or Congress or Attorney General all had the opportunity to court the electorate by showing an understanding of the important issues and how best to address them. Instead, one after the other, they resorted to bare-knuckled tactics and ham-fisted attacks. As embarrassing as the whole spectacle has been, the practical problem is that voters were forced to choose candidates not on the basis of ideas or principles, but on what they were able to decode from the morass of lies, insults and half-truths put out by candidates on all sides.
Today, though, is the proverbial Morning After and it is time for both winners and losers to dust themselves off and turn in a new direction. Election promises are easy enough to make and, apparently, almost as easy to break, but there is one that voters must hold their newly elected (and, in some cases, re-elected) officials to — the promise of working with people on both sides of the aisle. Our country and our state face a mounting pile of difficult problems and choices. If there is one thing we have learned over the past several years, it is that finger-pointing and partisan politics are not the solutions to any of those problems. Taking a position simply because it makes things more difficult for “the other side” isn’t a strategy that will move the country or the state forward. Making decisions based on what is more likely to win re-election is not leading. As the Morning After fades and 2013 comes in to view, it is time for those chosen few to accept the mantle of leadership and do just that — Lead. Shed the partisan rhetoric. Cast aside the Us versus Them mentality. As of today, it is no longer about Republican or Democrat. It is about American and Pennsylvanian.
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COMMENTARY FROM ACROSS THE WEB Region’s Business combed the blogosphere, the Twittersphere and other corners of the Web for interesting commentary over the past week or so. Here’s what we found.
Duplicate Post-Sandy Cooperation
@hblodget Disagree that GOP will now disown @GovChristie. The GOP desperately needs popular reasonable people that appeal to independents.
Americans can only hope the cooperation that elected officials have displayed in dealing with a killer storm will somehow be duplicated postElection Day. As damaging as Sandy has been, the greater danger to this nation is the crippling political partisanship that impedes its progress. PHILADELPHIA INQUIRER EDITORIAL
Enact Sandy Rule Now ... all mayors and governors of cities and states on U.S. coasts must protect families and businesses from getting wiped out by hurricanes. Now. ELIZABETH MACDONALD, FOX BUSINESS 05 NOVEMBER 2012
We Are Already In A Recession ... there are many confirming indications that a recession is already underway in the U.S. economy - the only question is how long it will be before
the stock market recognizes it and begins to realign prices with revised valuations. LANCE ROBERTS BUSINESS INSIDER 6 NOVEMBER 2012
Time To Rediscover Public Good So we come to the end of a bitter election feeling as if we’re two nations rather than one. The challenge – not only for our president and representatives in Washington but for all of us – is to rediscover the public good. ROBERT REIC BUSINESS INSIDER 5 NOVEMBER 2012
Journalistic Ethics Needed I love the idea of citizen journalists, I love the idea that anyone can exercise his or her voice, but this ideal works best when people understand journalistic ethics. TYLER MAHONEY, THE HUFFINGTON POST 6 NOVEMBER 2012
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8 NOVEMBER 2012
BY THE NUMBERS
The wealthiest ZIP code - for Gladwyne - in the Philadelphia area as reported by The Philadelphia Inquirer, with an average household income of $322,586. Villanova’s 19085 was second at $266,226.
Consumers who expect a more uplifting economic outlook in 2013, according to a Deloitte survey.
Holiday consumers who plan to spend less this year on gifts than they did in the year before.
Median household income for Montgomery County (including Gladwyne), 2006-2010.
Assists by the Philadelphia Sixers’ Jrue Holiday in his first three seasons. Only two Sixer players have had more in that time span, Maurice Cheeks and Allen Iverson.
Amount of money raised by the Barack Obama campaign, including $11.2 million in Pennsylvania.
Amount of money raised by the Barack Obama campaign through contributions of $200 or less.
The last season a member of the Philadelphia 76ers lead the National Basketball Association in assists. Wilt Chamberlin averaged 8.6 assists per game that season.
Number of coaching changes by the Sixers since the end of the 1967-68 seasons.
$2,800,000 The amount spent by Abraham Lincoln in his 1860 campaign, adjusted for today’s dollars.
Amount of money raised by the Mitt Romney campaign, including $8.9 million in Pennsylvania.
Amount of money raised by the Mitt Romney campaign through contributions of $200 or less.
Percent of the Mitt Romney campaign funds spent on mail.
Percent of the Barack Obama campaign funds spent on mail.
Percent of the Mitt Romney campaign funds spent on ads.
Percent of the Barack Obama campaign funds spent on ads.
Number of Super PACs with more than $1 million that supported Republican Mitt Romney .
Number of Super PACs with more than $1 million that supported Republican Mitt Romney .
Surveyed consumers who plan to participate in Black Friday shopping this year.
Decrease in the U.S. rental vacancy rate from 2011 to 2012 .
Decrease in the U.S. homeowner vacancy rate from 2011 to 2012.
Decrease in gross revenue generated by Pennsylvania casinos in October 2012 compared to October 2011.
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Published on Nov 8, 2012