Issuu on Google+

TIPS FOR A WORK-LIFE BALANCE VALUE IN HEALTH CARE BENEFITS

Doing what counts for your business.

susquehanna.net | 800.311.3182 | Member FDIC

REGION’S BUSINESS

PHILADELPHIA EDITION

A JOURNAL OF BUSINESS AND POLITICS

FIGHTING BLIGHT

WITHOUT THROWING MONEY AWAY Philadelphia — rife with poverty already — continues to abandon homes, schools and commercial properties, but one possible solution is logical, inexpensive and already active

NO ENFORCEMENT ON CITY-OWNED SITES DESPITE CITATIONS FOR BLIGHT TURNING A HOBBY INTO A SUCCESSFUL BUSINESS SCIENCE CENTER PLANS INCLUDE RENTAL UNITS

29 AUGUST 2013


29 AUGUST 2013

REGIONSBUSINESS.COM

CONTENTS

3 1519 Walnut Street

15 17

Fighting Blight in Philly Without Wasting Millions No Enforcement For City-Owned Properties Despite Blight

20

Private Exchanges: Value In Health Care Benefits

21

Designed To ‘Recede In The Background’

YEAR OF THE INNOVATOR

10

Hootboard Puts New Spin On Flyering

4

Made in America Festival Takes Shape

11

Five Tips For Having A Work-Life Balance

6

Science Center Plans Include Rental Units

12

Turning A Hobby Into A Successful Business

REGION’S BUSINESS A JOURNAL OF BUSINESS & POLITICS

Independence Media Corp. 350 Sentry Parkway, Building 630, Suite 100C Blue Bell, Pa. 19422 Email: feedback@regionsbusiness.com Advertising: advertising@regionsbusiness.com Online: regionsbusiness.com Twitter: @RegionsBusiness Subscription & Advertising Information: (610) 572-7109

PRESIDENT AND PUBLISHER James D. McDonald MANAGING EDITOR Terrence J. Casey ASSOCIATE EDITOR Rich Coleman CONTRIBUTORS Brandon Baker, Eric Boehm, Charlie Gerow, Solomon Jones, Don Lee, Greg Meckstroth, Juliana Reyes, Sandy Smith PROOFREADER Denise Gerstenfield ADVERTISING DIRECTOR Larry Smallacombe DIRECTOR OF BUSINESS DEVELOPMENT Deirdre Affel

Copyright 2013 Independence Media Corp. All rights reserved. Use of material within without express permission of publisher is prohibited. Region’s Business is published weekly on Thursdays and online at www.regionsbusiness.com. The published makes no representations or warranties regarding the advertising appearing in its pages or its websites.

2,600-6883 SF Available For Lease 30 Feet of Walnut Street Frontage Liquor License Available Neighboring tenants include Barbour, Govberg Jewelers, PNC, Apple, Guess, Ubiq, Gap, LuLulemon, Diesel, and Brooks Brothers

1900 Arch Street

1,500-16,333 SF Retail Available Fall 2013 Delivery 234 Luxury Units Above Two blocks from the Comcast Center Outdoor Seating Possible

866-Walnut 4 1429 Walnut Street Suite 1200 Philadelphia, PA 19102 Precisionrg.com


4

29 AUGUST 2013

REGIONSBUSINESS.COM

WEEKLY BRIEFING

LABOR

Yuengling Wants Alcohol Laws Changed Dick Yuengling, CEO of the Pa. brewing company, told a crowd of reporters and lobbyists at the monthly Pennsylvania Press Club luncheon, Monday, August 26, he wants the state out of the businesses of selling wine and liquor, and he would favor allowing beer sales in supermarkets and other stores, which would be a boon to his own business. But Yuengling said any changes to the state’s alcohol laws should protect beer distributors. “I don’t support the government being in business. I think they should be private enterprise,” Mr. Yuengling said. “Everybody has their thumb in the pie for their own good, us included. We’re trying to protect the beer distributors and make sure they’re not harmed by this thing.” This article was originally published on PA Independent at PAIndependent.com

Made In America Fest Prompts Road Closures, Safety Measures

The City of Philadelphia has announced a number of road closures and safety measures for this year’s Budweiser Made In America festival during Labor Day Weekend. The festival will take place along the Ben Franklin Parkway and motorists are advised to use alternate routes and allow extra driving time in the area.

Thursday, August 29, the inner lanes of the Benjamin Franklin Parkway from 22nd Street to Eakins Oval, will be closed until Tuesday, September 3. Friday, August 30, traffic for Friday morning rush hour headed inbound from Spring Garden Street Bridge or Martin Luther King Drive must exit Eakins Oval on the 24th Street ramp.

HEALTH CARE

Echo CEO Takes Leave Of Absence Dr. Patrick Mooney is taking an immediate leave of absence as president, CEO and board chairman of Echo Therapeutics, the Philadelphia medical device company said Monday, August 26. “Echo’s business operations will continue as usual in Dr. Mooney’s absence,” said Robert Doman, who will serve as executive chairman and interim-CEO, in a prepared statement. “We remain focused on completing our ongoing clinical studies and filing the Symphony CGM system technical file for CE Marking [for approval in Europe] in the near future.”


29 AUGUST 2013

REGIONSBUSINESS.COM

WEEKLY BREIFING EXECUTIVE BOOKSHELF

WHO TO FOLLOW

@UrbanMechanics

New Urban Mechanics Philadelphia’s own in-house civic idea incubator has its own Twitter account, and it’s worth following for civic innovation-minded tweets and retweets. RT @UrbanMechanics: PHL #Millennials: Have ideas to improve #Philly economic+civic life? @ mob_org can help! Check out http://mobilize.org/Philly RT @UrbanMechanics: Thanks for the follow! What’s inspiring and/or challenging you this week?

How Exceptional Companies Think How do some companies achieve exceptional performance over the long term? Michael Raynor and Mumtaz Ahmed have the answer — and it comes in three rules. Three Rules: How Exceptional Companies Think presents case studies that show how the three rules achieve great results in business. One Amazon reviewer said, “It has been a while since I have underlined, highlighted and annotated a business book like this one. Highly recommended.”

At Susquehanna Bank, we’re doing what counts to offer competitive financial products and services, local decision-making and outstanding customer service to build lasting relationships — with people like you. Susquehanna combines the strengths of a community bank with those of a diverse financial services company. Thanks to our regional structure, we have local leaders with lending authority and teams who are committed to providing personalized service. Plus, we have the resources to provide funding ranging from small business loans to complex financing packages. Call 800.311.3182 or stop in to talk about what we can do for you.

Doing what counts™. susquehanna.net | Member FDIC

RESTAURANT ROUNDUP

MUST-HAVE APP

Boxes If yard sales are a common occurrence in your household, or you frequently sell items on eBay, Boxes (iOS, free) is an app you should definitely have. “Boxes is a tool to help you make the most of the stuff you own by organizing and keeping track of all the stuff you love in one place,” the description says. You can create a real home inventory of your things by adding the value of the items, warranty information, original purchase date, serial and model number — even the UPC can be stored. This is very helpful for cataloging what you own, but the app also has an integrated eBay listing tool. A few taps in the Boxes app can have you selling your items in no time. You can also sell to other Boxes users by letting them browse through your collections.

Doing what counts for your business.

5

Sabrina’s Cafe Expanding To Main Line Sabrina’s Cafe, a popular brunch restaurant with locations in Italian Market, Fairmount and Drexel campus, has plans to expand to Wynnewood, the Philadelphia Business Journal reports. Cafe owner Robert De Abreu will open in the Wynnewood Shopping Center by year’s end, leasing agent, Jeffrey Fischer of Federal Realty Investment Trust, said. Sabrina’s will take over the former Sam’s Grille. The shopping center is a 252,000-square-foot retail complex anchored by Bed Bath & Beyond and Giant Foods.


6

29 AUGUST 2013

REGIONSBUSINESS.COM

WEEKLY BRIEFING

SAFETY

Philadelphia Safety Collaborative Open Mayor Michael Nutter announced the opening of the Philadelphia Safety Collaborative, the new site for members of the PPD, SVU, Department of Human Services, Sexual Abuse Investigation Unit, Philadelphia Children’s Alliance and staff from the DA’s Office. The Collaborative brings under one roof the services of the agencies, thereby streamlining the investigative process for incidents of sexual abuse. PENNSYLVANIA

Private Lobbyists Get State Pensions An Associated Press review found that at least 20 states, Pennsylvania included, are giving private lobbyists public pensions because they represent associations of the counties, cities and school boards. Legislatures granted them access decades ago on the premise that they serve governments and the public. In many cases, this also includes state health care benefits. Several states are beginning to question whether these organizations should qualify for such benefits, since they are private entities. New Jersey is pushing to end this inclusion and Gov. Chris Christie issued an executive order this month creating a Pension Fraud and Abuse Unit. ATLANTIC CITY

Strippers May Be Key For Atlantic City The Associated Press reports that Scores, the famous New York strip club, will open a satellite establishment inside the Trump Taj Mahal Casino Resort next month — the first strip club inside an Atlantic City casino in the 35 years of legalized gambling in the city. Bob Gans, the club’s managing partner, is investing $25 million in the newest Scores, which will open Sept. 12. “We feel this is the third leg of the Atlantic City triangle: gambling, alcohol and adult entertainment,” Mr. Gans said.

Science Center Apartment Project Now Good To Go BY SANDY SMITH The previously announced high-rise residential/commercial tower at the University City Science Center, which we reported on in January, is good to go now that financing has been secured and a new development partner brought on board. Developer Southern Land Company, which was previously working with Wexford Equities on the project, is now partnering with Redwood Capital Investment to fund the project and has secured financing from M&T Bank for the $110 million tower, which has BLT ARCHITECTS also undergone some slight alterations, adding a floor, 11 more apartments, and 43,000 square feet of interior space. The project, now known by its in 1963. address, 3601 Market, will now be a Michael Ytterberg of BLTa explained 300-foot-high, 28-story, 375-unit apart- the reason for siting the building in the ment tower with 15,000 square feet of center. “We’re in the Science Center in street-level retail and parking for 200 cars the interest of developing a 24/7 neighand 120 bikes. borhood and providing appropriate The retail space and parking garage will residential spaces for people who work be topped by a sixth-floor roof deck with in the Science Center and would like to a 1,750-square-foot fitness center and live nearby,” he said. swimming pool. The apartment tower The apartments will be marketed mainly will include studio, one- and two-bedroom, to the graduate and professional students and penthouse units with rents ranging and academic and medical professionals from $1,300 to $2,800 a month. who make up the bulk of the workforce in The 443,000-square-foot tower, the immediate vicinity. designed by BLT Architects (BLTa), is the This article was originally published first residential project at the Science Cen- on the Philadelphia Real Estate Blog at ter, an urban research campus established blog.PhiladelphiaRealEstate.com.

Pet-Centric Store Comes To Granary Come this September, you will now find Pennsylvania’s first Unleashed by Petco located at 1939 Callowhill Street. The store, introduced by leading pet specialty retailer Petco in 2009, offers local pet parents a wide variety of high quality food options, including natural, organic, raw and cooked food selections. The Granary Unleashed by Petco store will host several community gatherings throughout the year, including multiple adoption events aiming to unite the area’s shelter pets with forever homes. Also, on September 7-8, 2013, Unleashed by Petco will celebrate its grand opening with

pet-centric festivities including: - Complimentary samples of dog treats and “in season” food from the pet bakery. - Complimentary dog-friendly ice cream from 11 a.m. – 3 p.m. - Pet adoptions where potential pet parents can meet animals of all types looking for forever homes. - Opportunities for local pets and pet parents to meet. - Free tote bag and one pound of treats for all guests who make a purchase. This article was originally published on the Philadelphia Real Estate Blog at blog. PhiladelphiaRealEstate.com.

EDUCATION

Mayor Nutter Responds To PFT Responding to commercials from the Philadelphia Federation of Teachers that attack him, Mayor Michael Nutter addressed the attack ads Monday, August 26. “It’s part of a planned distraction campaign that gets all of you talking about that and not talking about how we select teachers to be in classrooms, how we bring back folks to fill vacancies, whether or not folks should pay something for their health care,” Mayor Nutter said at the conference.

Mothballed Schools’ Worth In Question The Inquirer reports that Council President Darrell L. Clarke wants to give the school district the money it needs to run efficiently, in exchange for its portfolio of empty schools, which could then be sold over time to repay the city. Council president Clarke says the district’s inventory of empty buildings, which includes 24 schools closed this year, contains some choice real estate.

Corbett Forces Out Acting Education Sec. Gov. Tom Corbett asked for and received the resignation of Acting Secretary of Education William Harner. Gov. Corbett’s office announced the change but did not name a reason. The Patriot News cited an unnamed source who said Harner’s removal came when, “a background check... uncovered a matter that occurred during his time at Cumberland Valley”.


www.marcumllp.com

As a national ďŹ rm, we have never lost sight of our loyalty and commitment to the community in our backyard. With our deep expertise and diverse skill-set, we are able to provide the local business community with a variety of services to help them achieve success.

Discover the

Dierence

International Member of Leading Edge Alliance

ASSURANCE

I

TAX

I

ADVISORY


8

29 AUGUST 2013

POLITICAL COMMENTARY

REGIONSBUSINESS.COM

Corbett Financing Efforts Saved State Millions

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.

The dog days of summer have passed. Schools are open again. The air is crisper. It’s Labor Day. Labor Day is a celebration of the American worker. In the closing days of the 19th century, following a bloody labor dispute in Chicago, President Grover Cleveland signed into law a federal holiday for workers. It culminated a series of local and state efforts pushed by organized labor to celebrate the economic and social achievements of America’s workforce. Sadly, today there are too many who want to be working but are not. Unemployment continues to hover in the 7.5 percent range. Of even greater concern is the fact that the unemployment stats of the BLS do not take into account those who have dropped out of the workforce altogether. With those troubling numbers comes an added concern: the state of our unemployment compensation system. For years Pennsylvania’s unemployment compensation was structurally underfunded. The system wasn’t sufficient to support the large number of unemployment compensation claims in the wake of the recession. As a result, the commonwealth had to borrow money from the federal government, as many states did, in order to cover our shortfall and assure payments to those who qualified. Like most borrowing that is done under stress, the terms of these loans were not the best for Pennsylvania. A variable interest rate threatened to push the APR above 10 percent. Considering that our debt topped out at roughly $4 billion, that was a heavy load of interest. Additionally, Pennsylvania companies

saw their federal unemployment (FUTA) taxes increase because of a significant cut in the tax credit they received. Governor Corbett was faced with this spiraling problem as he entered office. As he took the oath of office, his state was entering the second year in which it owed the federal government money on account of its UC debt. At the same time, a provision in the UC law triggered an additional payment required of employers for Interest Factor contributions. It was a perfect storm: additional UC taxes on employers, the FUTA tax credit reduction from employers, the additional Interest Factor payments by employers and a rapidly rising debt and interest rate. Governor Corbett and his Labor Secretary, Julia Hearthway, quietly set out to address the insolvency of the fund, deal with the escalating interest rate and reduce the taxes on employers which were a job creation killer. Together with the legislature they were able to both restructure the debt on terms much more favorable to the citizens of Pennsylvania and tackle the underlying insolvency of the depleted UC fund. Without great fanfare, they refinanced the debt, carrying potentially double digit interest rates through bonds in the private market. Last summer the state paid off its federal debt, saving employers nearly 23 million dollars in just 75 days and restoring the full FUTA tax credit. A few months later the commonwealth closed on the permanent financing deal at a historically low fixed rate of 1.29 percent. This will save Pennsylvanians at least $150 million in interest alone.

“The Intelligent Choice” Business and Public Policy Every Week In Print Every Day at RegionsBusiness.com For More Information, Call 610.572.7112

REGION’S BUSINESS A JOURNAL OF BUSINESS & POLITICS

In addition to getting us out from underneath an onerous debt structure, the Corbett Administration went further by getting to the heart of the problem — the structural insolvency of the UC fund. A major part of the solution is a re-alignment of how state UC taxes are calculated. Their phased-in changes are already in effect. All told, the Corbett-Hearthway reforms will save nearly $400 million each year. That’s cause for a Labor Day celebration. The complicated nuances of the unemployment compensation system don’t make headlines. Formulas for calculating unemployment taxes and credits aren’t sexy enough to get much attention. But their impact on the ability of business to expand and create new jobs is enormous. The efforts of Governor Corbett and Secretary of Labor and Industry Hearthway may not have been chatter across breakfast tables, but they deserve a salute as Pennsylvania reaps the benefits of their actions. As Secretary Hearthway noted at the time, these reforms received unanimous approval in the General Assembly. “It’s a testament to the spirit of cooperation, bi-partisanship and the leadership of Governor Corbett and the General Assembly to resolve this urgent issue,” she said. Pointing out where legislative gridlock has blocked important reforms has become media sport. Looking at the quiet successes that bring long term benefit to the commonwealth’s working families probably doesn’t sell as many newspapers. But they are an important Pennsylvania success story.


29 AUGUST 2013

REGIONSBUSINESS.COM

POLITICS

9

CDC Opposes Liquor Store Privatization In PA BY MELISSA DANIELS HARRISBURG — If the Centers for Disease Control and Prevention had a say in whether Pennsylvania sells off its stateowned liquor stores, it’d likely vote to keep them around. Recommendations from the federal agency’s Community Preventative Services Task Force say turning over to the free marketing the sale of wine and liquor leads to excessive drinking. But these conclusions are disputed by other researchers and privatization supporters, who claim the CDC isn’t looking at the right data. The task force recommendations were included in a mid-August study on how much excessive drinking costs state economies and governments — about $224 billion annually nationwide, and about $8 billion in Pennsylvania, per 2006 figures. “Fortunately, the Community Guide includes a number of effective strategies that states and localities can use to prevent binge drinking and the costs related to it,” Robert D. Brewer, one of the authors of the report, said in a news release.

Those “strategies” include raising taxes and limiting alcohol sales. And, the guide says, states that control the sale of alcohol fare better than states where the free market is in control of alcohol sales. “The maintenance of government control of off-premises sale of alcoholic beverages is one of many effective strategies to prevent or reduce excessive consumption, which is one of the leading causes of preventable death and disability,” reads the task force’s 2011 recommendation. The CDC claims that when the free market sells alcohol, more alcohol becomes available at cheaper prices. That, the CDC says, leads to illegal sales to minors. Crunching number from multiple studies on privatization efforts of the 70s and 80s, the study cites a 44 percent median increase in per capita alcohol sales post-privatization. But that’s debatable, according to the alcohol industry. In a Philadelphia Inquirer op-ed, Ray Scalettar, medical adviser to the Distilled Spirits Council and a George Washington University

professor, said the CDC didn’t take into account a national uptick in wine consumption when coming up with that 44 percent figure, skewing results. Whether the CDC’s recommendations hold water in Pennsylvania is dubious. Gov. Tom Corbett wants to get the state out of the liquor business. Though it didn’t happen during the budget session, Gov. Corbett promised to keep the issue alive when lawmakers return to the Capitol for the fall session. But there’s no sign the governor’s plans will be received favorably by Senate Republicans, who are more hesitant than House Republicans to get rid of the Pennsylvania Liquor Control Board. Democrats in both chambers favor keeping state control of its wine and liquor sales and turning the PLCB into a more profitable asset. People who work at state-owned stores are public employees and represented by public-sector labor unions, who’ve lobbied against privatization efforts. Anthony Davies, an associate pro-

fessor of economics at Duquesne University who studies alcohol laws, said conclusions about increased consumption tend to wrongly focus on individual behaviors. Too much drinking, like too much television, sleeping or partying, carry a cost, he said. Mr. Davies said government intervention in alcohol sales doesn’t necessarily prohibit negative effects. “What we do not see is what we would expect, which is more control leads to better outcomes,” he said. “You find this with alcohol-related fatalities, you see it with underage drinking, you see it with binge drinking.” But, Mr. Davies said, that research is just like the CDC’s. It’s held up to prove a point. “Things like the CDC report, or even the studies I’ve done, they seem to get thrown into the mix,” he said. “Someone will cite it, and someone will cite a contradiction.” This article was originally published by Pennsylvania Independent at PaIndependent.com.


10

2013: YEAR OF THE INNOVATOR

29 AUGUST 2013

REGIONSBUSINESS.COM

Hootboard Puts New Spin On Neighborhood Flyering Business: HootBoard Founders: Satyajeet Shahade Contact: sshahade@hootboard.com

BY BRANDON BAKER

Steadily, but almost quietly, Philadelphia has become a hotspot for entrepreneurs. The combination of great ideas, available capital and a welcoming environment have set the stage to make 2013 a breakout year for innovation and new businesses. To Learn More ... For more information on sponsorship opportunities or to suggest story ideas, call our main office at 610-940-1656. The web: RegionsBusiness.com Facebook: Facebook.com/regionsbusiness Twitter: @RegionsBusiness Sponsored by

Picture it: The neighborhood is plastered with flyers — one tacked onto a telephone pole, advertising a concert that Friday, another stapled to a tree, tempting passersby with a Saturday-morning yard sale and dozens of others spreading word of lost cats and wallets. Now imagine this: Every one of these flyers are taken out of the physical realm, and aggregated into one Web space organized by zip codes. Thus, Satyajeet Shahade breathed life into his year-old startup, HootBoard. “The idea of HootBoard grew out of two previous startup endeavors: One of the goals was to remedy my frustration of not being able Hootboard aims to bring communities together through the online presentation of flyers for to market my previous startup events, gigs, activity partners, housing and more. FLICKR.COM/NEIGHBORWORKSAMERICA into university and academic circles of choice,” said Satyajeet Shahade, founder of HootBoard. “On the other hand, I was working on a communitybased reuse platform to Leading up to its official launch, HootBoard, allow members of large communities to reuse stuff which completed Novotorium’s business launch amongst themselves. At some point, I decided to program and is based in University City’s Science marry the two, and HootBoard was born.” Center Quorum, will be partnering with universities The idea, he said, is to bring communities in Greater Philadelphia and all across the Northcloser together. Users submit a zip code, and are east to target student groups that, Mr. Shahade said, ambushed with a running list of flyers — “hoots” waste 58 trees worth of paper each year on advertis— of all shapes and sizes that cater to those intering student events. ested in local events, gigs, activity partners, housAs such, a “flyer contest,” with a prize of $2,500, ing, etc. will run between Sept. 11 and Oct. 4 between stuThese advertisements are tagged to user-created, dent organizations. relevant communities and, like Twitter, can be “reA self-funded endeavor, HootBoard currently hooted” in traditional social-media fashion. expects to seek funding later this year. Or, in layman’s terms, it’s Craigslist with images.


29 AUGUST 2013

2013: YEAR OF THE INNOVATOR

REGIONSBUSINESS.COM

DIARY OF A STARTUP

5 Tips For Work-Life Balance At A Startup

Two Former Eagles Staffers Launch Fantasy Fooball Platform

NUMBERS

Tips For Entreprenuers From Bob Moul Entrepreneurs don’t function in a vacuum, so they should recognize the community around them, said Bob Moul, CEO of Artisan Mobile and Philly Startup Leaders president, to the members of Drexel University‘s incubator summer prep program in a talk that was featured on Drexel’s Baiada Institute blog.

In her latest “Diary” entry, Joanne Lang, founder of family-planning software tool AboutOne, dishes her own practical advice for managing work — especially as an entrepreneur — and being a mother. In her words: I’m often asked how I balance being the mom of four boys who are less than 9 years old, and the CEO of a tech company in growth mode. The honest answer is that I don’t. But really, I think the expectation that anyone can is completely unrealistic — my recent “working” vacation is proof of that. Being a mom and running a startup is exhilarating; but at the same time, it’s exhausting, stressful and, if you let it, guilt-inducing. It’s important to let go of the idea that everything has to be perfect. If you don’t, no matter what you do, you’ll always feel like you’re letting someone down. Over the last three years I’ve learned several lessons around work-life balance that may be useful to others as the holiday season approaches: 1. Schedule time for “you” in your calendar. Allow yourself 20 minutes per day (or one hour every two days) for exercise, a book, a bath, a manicure or anything that gives you a break. 2. Schedule family time in your calendar. Maybe it’s a movie or date night with your children or spouse, but schedule that time and turn off all devices. It’s important not to miss this time with your family because you can never get it back. 3. Sleep is key. At least for me. When I am fully rested I am far more productive. 4. Outsource the tasks that you can. I believe my children will remember our vacation time and the time we spent together. They also will remember me doing homework with them or being at a school play. They won’t remember me cleaning the bathrooms, so I hired a cleaner. They won’t remember me ironing their clothes, so I pay someone to do this. 5. Cut out activities that add no value. Facebook and Twitter can eat time that you could be with your children. The same goes for television. I think you can have it all; you just can’t have it all at one time. The only way to find true work-life balance is to understand what’s important to you in the moment and focus on that. Making choices is the key to finding work-life balance.

11

BY JULIANA REYES

cofounder Stephen Wendell said, and the team expects those numTwo former Eagles staffers bers to grow as football season launched what Fortune said could nears. The service costs $9.99 per be “the best fantasy football plat- team. The founders, Matt Papson, a forform.” It’s called Reality Sports Online mer salary cap analyst for the Eagles, and it offers participants a real-time and Mr. Wendell, a former law clerk free agency auction room, where for the Eagles, began working on they can bid on players for multiyear Reality Sports Online in January deals — something that you can’t 2012, roughly around when they left do with you average fantasy football the Eagles. league. Reality Sports Online has another The platform gives participants Philly tie, too: the company worked salary cap restrictions, too, in an with Callowhill web development effort to recreate what NFL general firm Brolik to design its site. managers have to deal with. This article was originally pubSince its launch in July 2012, lished on Technically Philly at Tech2,100 people have signed up, nical.ly/Philly.

Conshohocken Digital Agency Makes Move To Downtown Philly BY JULIANA REYES Netplus, a digital agency founded in 1996, moved from Conshohocken to Center City earlier this summer. The move was in part to get access to Philly’s talent pool, the company said on its blog. Netplus’s past clients include Tommy Hilfiger, The Kennedy Center and the American Red Cross. Its new offices at 7th and Arch Streets are home to 25 employees. This article was originally published on Technically Philly at Technical.ly/Philly.

His advice? Get to know members of state and local government. It’s advice that Moul has followed himself, helping lead the vision behind StartupPHL, the city’s $3.5 million initiative to support the local tech scene. TECHNICALLY PHILLY

Urban Outfitters Sees Boost In Online Sales The Philadelphia Inquirer reports that Urban Outfitters’ shares were up 10 percent last week and it reported higherthan-expected profits ($76 million) for the three months ending July 31. One analyst said the ley to the company’s success was less brick-and-mortar stores and more online sales. While total sales rose nine percent, Urban’s online sales rose 40 percent, the Inquirer reported. Urban also opened fewer Free People stores to cut costs. Last fall, the Navy Yardbased retailer said it wanted to make half of its total sales online-only. Online sales currently make up about one-fifth of Urban’s total sales.


12

29 AUGUST 2013

2013: YEAR OF THE INNOVATOR

REGIONSBUSINESS.COM

Turning A Hobby Into A Successful Business

Akilah C. Thompson, entrepreneur, motivational speaker and author, is founder of ACT Inspires, Inc. She can be reached at http:// www.ACTinspires.com

News Flash! You do not have to spend the rest of your life working in a cubicle from nine to five every day. Neither do you have to settle for working in a miserable profession that barely pays the bills. Have you ever thought about turning your passions into a business? Is there something you enjoy doing so much you currently do it for free? Have you ever thought about how much income you could earn from your hobbies? Passion is one of the key ingredients to becoming a successful entrepreneur. When we are passionate about something, we find enjoyment in sharing our talents with others. So, why should we stop there when we can start making money doing what we enjoy? Let’s explore what it will take to turn your hobby into a business. With the appropriate planning and an entrepreneurial mindset, you can be on your way to starting a successful business with passion as your foundation.

Tip One: Save! Save! And Save!

Before you decide to leave a corporate career or any job to start your own business, be sure to save at least 12 to 18 months of salary. As an entrepreneur, the checks will stop coming every two weeks and there may be times when the checks wont show up as planned. If you have sufficient savings, you will be prepared for those “Rainy days” which are almost guaranteed to happen. In addition, most of the capital that will be used to start your business will come from your own pockets. You want to make sure you can appropriately fund your business with the start up funds needed to get your business off the ground.

Tip Two: Create a Business Plan

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 business plan is a snapshot that potential investors and banks look at in order to predict where your business is headed and what it will look like in the future. “If you fail to plan, you plan to fail”. Most businesses are unsuccessful because their business plans were incomplete or ineffective. In addition, your business plan sets the strategic plan and direction for your business to help you make appropriate decisions with the end goals in mind. The Main Components of a Business Plan are: The Mission Statement — articulates

the purpose of the company’s existence, its target audience as well as the products and services. The Vision Statement — the guiding force behind the mission statement that focuses on the values, aims and the future direction of the company. The Organizational Plan — the description of your business, products and services and the goals of the company. In this section, the long term objectives for the company are recorded along with the formulation of the company’s strategies, tasks and functions. The Competition — refers to researching other businesses that offer similar services and products within market. This is comparing prices and other marketing techniques. The Market Analysis — the study of the market in its entirety that relates to the strengths, weakness, opportunities and threats that may arise when launching your business. The Market Plan — an essential part because this is where you develop strategies on how to solicit consumers and business. Use all public relation resources and social media to market your brand. Social media has become the voice to the general public to connect with current and prospective clients. Twitter, Facebook, Instagram and YouTube allow you to create a presence in the google domain, which will help customers find you on the web. Incorporate social media in your strategy and invest in a good publicist to let the media know about your business. The Financial Plan — the spine of the business plan, because it is a blue print of your business’ current and future financial state. It is based upon the business’ balance sheet, income statement and

cash flows. In other words, the financial plan captures how much money is needed to start the business including all start up expenses. In addition, the financial plan will forecast proposed revenue for years to come to assess growth potential. The Executive Summary — the final piece of the puzzle, and the most important part because it summarizes all the sections of your business plan by extracting the main points. Prospective investors determine whether your business is profitable based upon this section of the document. Make sure that your main points are clear, concise and creative.

Tip Three: Hire an Accountant

From day one, you need to make sure that you are recording all financial information pertaining to your business. Exceptional book and record keeping skills is essential. An accountant can help you with tax planning, business plan review, bookkeeping, payroll and other functions that relate to the disbursement of money. As mentioned earlier, the financial plan is important because it is a blue print of your business, therefore having an accountant allows you to maintain order not only in your business but it also gives you a piece of mind that your finances are in good hands.

Tip Four: Live your dream!

Now it’s time to live your dreams. Take all the tips that you have been given above and make your dreams come alive. Businesses are built based on creative and innovative ideas that were given wings to fly. Let your passion, ideas, skills and hobbies allow you to spend your life doing things you love to do as an entrepreneur. Your hobby may be the stepping-stone needed to start a successful career as your own boss.


29 AUGUST 2013

2013: YEAR OF THE INNOVATOR

REGIONSBUSINESS.COM

13

With Education Crisis, JAG Focuses On Dropout Rate BY BRANDON BAKER With the Philadelphia School District in a tumultuous state of affairs, Anthony Powell insists it couldn’t be a more perfect time for JAG — Jobs for America’s Graduates — to swoop in like Superman and attempt to alleviate some of area schools’ too-numerous-to-count struggles. Jobs for Pennsylvania Graduates, a nonprofit affiliate of JAG located in Center City, officially formed in 2010 under Mr. Powell’s leadership, a former graduate of the program himself circa 1982. The nonprofit, which currently employs 11 people, will launch its programs in two Philadelphia schools this fall: Universal Audenried Charter High School and Boys’ Latin of Philadelphia Charter School. To supplement the two launches, Jobs for Pa. Grads will also work in partnership with Lincoln University’s Upward Bound program. “Given all that’s happening with the school district and the challenges the district and state are having... the focus is on increasing the graduation rate and decreasing the dropout rate,” Mr. Powell said. “We thought it to be an ideal time for JAG to get involved in the education system here in Pennsylvania.” According to the Philadelphia Public School Note-

book, the dropout rate amongst Philadelphia’s publicschool students climbed to 36 percent last year. Jobs for Pa. will use the “JAG model” as part of its inand out-of-school program, which aims to set disadvantaged youth — meaning students who come from the lower half of the economic totem pole, have a disability or are dealing with teenage pregnancy — on a path to employment and postsecondary education. The program, which students sign up and earn class credit for, teaches students leadership skills, how to build a resume and a laundry list of life skills. Students are assigned a JAG “specialist,” who assumes the role of a sort of long-term mentor. Part of the initiative for the Philadelphia School District will be a 3 p.m. to 7 p.m. out-of-school service-learning program. Starting in 2014, Mr. Powell said he hopes to expand to the suburbs, targeting schools like Bensalem High School, Bristol High School and more. Last year, New Jersey Governor Chris Christie funded the implementation of JAG in two schools: Barringer High School in Newark, as well as Camden High School. Nationally, Mr. Powell said, the JAG program is employed in 34 states and reaches 45,000 students. It was started in Wilmington, Del., in 1980 by former Delaware Governor Pete du Pont.

Anthony Powell, founder of Jobs For Pennsylvania Graduates The program recently received $300,000 in funding -- $250,000 of which came from the City of Philadelphia. Other funders include AT&T and Microsoft. Jobs for Pa. will hold a fundraiser on Sept. 21 at the Hilton DoubleTree with City Councilman Kenyatta Johnson and Thaddeus Young of the 76ers.

Responsible for 6,000 miles of pipeline. Available to 500,000 customers. Focused on your safety.

Around our city, around the clock.

If you smell natural gas, call (215) 235-1212

www.pgworks.com


Inaugural

MARCUM I N N O VATO R of the Year

AWA R DS

November 14, 2013 Is your company a catalyst for change? Have you pushed the boundaries in your industry? Is your innovation helping to boost Philadelphia’s growing economy? Marcum LLP and Region’s Business are in search of Greater Philadelphia’s top innovators, and we want to hear from you. The Inaugural Marcum Innovator of the Year Awards will honor businesses of all sizes that are pioneering new advancements in the fields of Health/Biotech, Technology, Business Management, and Energy. Three winners will be named in each category, based on company size. Tell us about your break-through innovation and what makes your company a leader in our region by visiting our website – www.marcumllp.com/innovator. Submissions must be received by September 15, 2013. Winners will be announced at a Gala Awards Ceremony at the Franklin Institute on November 14, 2013. Don’t miss out on this spectacular opportunity to join our region’s business leaders in recognizing and celebrating the spirit of innovation in and around Philadelphia. For complete details including nomination criteria, please call Jacki Hallinan at 484.270.2715. Ben Franklin may have been Philadelphia’s first and most celebrated innovator, but he did not have a corner on the market. Who knows? You could be Philadelphia’s next Innovator of the Year! For tickets to the event, please call 610-572-7112 ext 102. If you are interested in sponsoring this event, please call Deirdre Affel at 610-572-7136. Marcum LLP is a top national accounting and advisory services firm.

Sponsored by

Discover the

Difference

www.marcumllp.com

International Member of Leading Edge Alliance

ASSURANCE

I

TAX

I

ADVISORY


15

29 AUGUST 2013

REGIONSBUSINESS.COM

FIGHTING BLIGHT There’s a better way than throwing millions away BY SOLOMON JONES

V

ast stretches of North Philadelphia’s Sharswood community bear the scars: Vacant lots strewn with tires and trash; abandoned houses whose broken windows stare out like empty eyes; entire blocks where few houses remain standing. Decades of population loss, business disinvestment, and government neglect have left this and other Philadelphia communities suffering the debilitating affects of abandonment. And while there are fledgling signs of development in Sharswood and neighborhoods like it, the truth is that these neighborhoods have fallen so far that it will take years to bring them back. The abandonment problem is multi-faceted. Philadelphia’s estimated 40,000 vacant parcels are not only blighted properties, they are places where criminals hide guns and drugs. They are places where brothels and drug dens arise. And where abandonment is concentrated, poverty rates are higher and communities fail.


16

29 AUGUST 2013

REGIONSBUSINESS.COM

DAMON LANDRY

I

n a city that already has the highest rate of deep poverty of any large city in the country, we have abandoned much more than houses. We have abandoned schools — 23 of them have been shuttered in the last year alone. We have abandoned commerce — 167,000 manufacturing jobs left the city between 1967 and 1987. We have, in many cases, abandoned hope. In order to stem the tide of abandonment, we must embrace solutions that are less expensive and more effective than what we’ve done in the past, and we must begin the process now. Philadelphia has tried to address vacancy through labor intensive and expensive government programs. The Street Administration’s Neighborhood Transformation Initiative (NTI) made a $295 million investment in tearing down dilapidated buildings and cleared blight in many neighborhoods including Sharswood. But the

new development that was supposed to come in its wake was inconsistent. The Nutter administration’s Vacant Property Strategy, which was launched in 2011, leans on hauling property owners into court. Thus far, the city has collected $834,000 in permit, license or property certification fees, and the courts have assessed $786,000 in fines and judgments. Despite these efforts, large parts of communities like Sharswood resemble war zones. There is a better way to address vacancy. It requires only minimal public investment compared to larger programs carried out by city agencies. It has proven to be effective, as a study by the University of Pennsylvania illustrates. Best of all, it’s simple. The program is called Philadelphia LandCare, and it’s run by an unlikely entity — the Pennsylvania Horticultural Society. Famous for its annual Flower Show, the society has been a

force in greening Philadelphia neighborhoods for more than 50 years. Since its inception as a citywide program in 2003, the LandCare program has cleaned and greened 8,600 vacant lots at an average cost of $1 to $1.25 per square foot. It maintains the lots at a cost of two cents-per-square-foot each year. Its annual budget averages about $2.5 million — money that is largely provided by the Office of Housing and Community Development. One can see the organization’s work in neighborhoods like Sharswood: Green lots with leafy trees and simple wood fencing; meticulously maintained areas that are litter and graffiti free. The overall effect is, in a word, transformative. That transformation needs to be implemented citywide, and from a budget perspective, it’s not a farfetched idea. “The cost of transforming 20,000 more vacant lots would be $32 mil-

lion, with another $4 million devoted to annual maintenance,” said Philadelphia Horticultural Society Director Bob Grossmann. “For 30,000 landscape installations the total cost would be $48 million with another $5.5 million devoted to annual maintenance.” In neighborhoods like Sharswood, where longtime residents have watched houses die as surely as the owners who once lived there, that cost is a pittance compared to the price of abandonment and the crime that it breeds. That’s part of the reason that the Brewerytown Sharswood Community Civic Association has worked in collaboration with the Philadelphia LandCare program. Cleaning and greening lots like the one at 23rd and Jefferson Streets reduces the places where crime can hide. It’s a fact borne out by statistics. In an analysis published in the American Journal of Epidemiology in 2011, Charles C. Branas, Ph.D., professor of


17

29 AUGUST 2013

REGIONSBUSINESS.COM

Blighted & Cited But No Enforcement On City-Owned Land

P.W. BAKER

BY SOLOMON JONES

T

he 2100 block of Harlan Street looks like a wasteland. Running east and west between Master and Jefferson Streets, the whip-thin thoroughfare is home to eight vacant lots so neglected that the Department of Licenses and Inspections (L&I) has issued citations. With tree-sized weeds still swaying in the wind, it’s clear that the property owner hasn’t addressed the violations. In this case, the owner doesn’t have to, because these blighted lots are owned by the Philadelphia Redevelopment Authority. In neighborhoods throughout the city, properties owned by government or quasi-government agencies are being cited by L&I for vacancy-related violations, such as broken windows and doors and high grass. But unlike

private property owners, public entities cited for such violations are not subject to court action. That means the city doesn’t collect court fees or fines for those violations. Nor does it collect property taxes on those parcels. Records obtained by AxisPhilly through a Right to Know request show that at least 1,899 of the approximately 8,000 properties owned by government or quasi-government agencies were cited by the Department of Licenses and Inspections (L&I) for vacancy-related violations in the past year. That amounts to nearly one out of four. The violations show that government agencies, while paying millions to support programs to fight blight, are often the very landowners whose properties are blighted. At a time when the School District of Philadelphia, which depends heav-

ily on property taxes, is facing a deficit nearing $304 million, the city can ill afford to have 8,000 governmentowned vacant properties that don’t generate tax revenue. Nor can it afford to have nearly 1,900 of those properties receiving blight citations that do not generate fines or judgments. “[L&I] cites properties owned by government and quasi-government agencies the same we way cite all other properties,” said L&I spokesperson Rebecca Swanson. “We don’t have a list [of publicly owned property]. We obviously have access to ownership information because the citations are mailed to the owner of the property in addition to being posted on the property itself.” That means L&I pays for an inspector to go to the property, generates copies of the violation to be affixed to the property, and pays to mail a copy

to the government agency that owns the property. Although taxpayers pay for that process to be carried out, public entities are never hauled into court. There is no enforcement. Meanwhile, the city has amassed $1.6 million in permits fees, fines and judgments against private property owners cited for blight-related violations in the last two years. To be fair, some publicly owned blighted parcels are addressed by the Philadelphia LandCare program, which refurbishes vacant lots only after they are cited by L&I. But many of those parcels are not cleaned and greened, which means that blocks like Harlan Street become virtual ghost towns where government or quasigovernment agencies sit on blighted property without penalty. The list of public agencies that have been cited for doing so is extensive.


18 epidemiology and director of the Penn Cartographic Modeling Lab, established a correlation between the program’s greening of lots and reductions in crime. In lots that had been greened, gun related crimes were down seven-to-eight percent. The reasons were many, and they were rooted in common sense. A vacant lot that is cleared of trash, weeds and debris is a more difficult place to hide a gun. Criminals are less comfortable carrying out their activities in open space. But there is one thing more. Neighbors feel a sense of ownership, and they become more invested in maintaining the space. This is by design, Philadelphia LandCare Project Manager Keith Green said in an interview at the offices of the Pennsylvania Horticultural Society. “When this program first started I was under the impression that you had to fence off everything to keep people out because that’s what we had done for years,” Mr. Green said. “This program actually invites people in and by inviting people in they kind of take some form of ownership and then they won’t let people destroy it. “In the past when you had like a community garden, only the people on the block wanted to watch over it, whereas on these sites, not only do the people on the block walk through them or use them. Everybody in the neighborhood uses them. So then it becomes like a neighborhood investment. So to me that kind of empowers the neighborhood.” A city where vacancy is rampant can benefit greatly from that kind of empowerment. When communities feel that they have a stake in the land around them, people behave differently. Crime is reduced. In a community like Sharswood, which is in

29 AUGUST 2013

REGIONSBUSINESS.COM

the midst of the 22nd Police District — the second-most violent district in the city — greening lots is about much more than beautification. It’s about saving lives. Still, the LandCare program is not a cure all for communities with overwhelming abandonment, said Mr. Grossmann. “It’s part of the answer.” “This program is funded through OHCD and it’s seen as a community development tool to work in conjunction with other community development tools. So we work with community partners, CDCs, neighborhood organizations, to supplement other kinds of work and other kinds of investment that are happening in neighborhoods. So it has great impact when it’s taken in collaboration with other kinds of investment.” The investment must start somewhere, and there is no better place to begin than with the abandoned lots that have turned huge portions of communities like Sharswood into wastelands. We can do better than that. And since we now know there is a correlation between the presence of vacant lots and the proliferation of violent crime, we must do better than that. So here is the challenge: Philadelphia LandCare has targeted 10 of the city’s most blighted neighborhoods over the next two years. Their ability to transform the vacant lots in those communities will require an estimated $8 million in funding. We need to find that money. Doing so could be the first step in ending Philadelphia’s decades long cycle of abandonment, poverty and crime. It’s a step that’s well worth taking. — Solomon Jones writes commentary for Axis Philly.

The Philadelphia Redevelopment Authority (RDA), which is deeply involved in the city’s effort to dispose of vacant property, has had at least 335 properties cited for vacancy-related violations in the last year. The Philadelphia Housing Development Corporation (PHDC) has had 257 properties cited. The District Attorney’s office has had 11 properties cited. The City of Philadelphia and its Department of Public Property has had 509 properties cited. And the U.S. Department of Housing and Urban Development (HUD) has had 102 of its properties cited. Among the agencies whose properties have been cited in the last year, the Philadelphia Housing Authority (PHA), with at least 685 of its properties receiving vacancy-related violations, owns the most. PHA oversees and manages Philadelphia’s public housing. In many ways, the agency is emblematic of the government and quasi-government agencies dealing with massive inventories of blighted properties. The blighted properties owned by PHA didn’t become that way overnight. They became blighted as a result of a vast array of problems Philadelphia has faced over the last half-century. “PHA acquired the majority of our scattered sites in the 60s and 70s as the City’s population was rapidly declining due to flight of industry and suburbanization,” said PHA spokesperson Nichole Tillman. “Many of the properties were old even at that time. So, advanced age and declining federal funding for rehabilitation led to vacancy and eventual demolition.” Paul Chrystie, of the Office of Community Development, echoes those reasons. “The [properties have] been acquired over literally decades,” Mr. Chrystie said. “It’s not as if five years ago

we had zero and now we have 8,000. This goes back to big urban renewal strategies of the 60s. Some of the properties were acquired for projects that didn’t take place. There are several hundred in Logan that were the result of the Logan homes falling down. There’s a whole host of reasons over decades that they came into public ownership.” However the parcels came to be publicly owned, one thing is clear: The only way these properties can generate tax revenue is to sell or transfer them to private owners. The city has adopted a number of policies to try to make that happen. Among them is PhillyLandWorks, a website where publicly owned property is available for purchase. “Whether for development or a community garden or a property owner looking to acquire a lot next to their house for a sideyard, those properties are available online with the goal of making them productive,” Mr. Chrystie said, adding that the site has simplified the formerly complicated process of buying public property. PHA has tried another method that has been somewhat successful. Through its 6 in 5 Development Initiative, which involves new construction in areas with amenities, as well as disposition to other affordable housing develop-

ers, the agency has begun to auction off vacant property. To date, PHA has held three auctions. The first, in November 2011, featured more than 400 properties, most of which were bundled. The second took place a month later and featured 100 individual properties. In July of this year PHA had nearly 200 vacant properties on the auction block, and raised approximately $2.1 million. The auctions have been lauded as successes. But then there are blocks like Harlan Street, where publicly owned blight sits untaxed, unused, and unaddressed. Such blocks produce the kind of shadows that allow crime to fester and grow, just as surely as the weeds that spring from the Philadelphia Redevelopment Authority’s vacant and blighted lots. It’s unacceptable for public entities to own 1,900 vacant parcels that are blighted. Moreover, it’s unfair for those public entities to be treated differently than private property owners. I’m calling on the city to address this basic inequity. And if the only real solution is to sell that publicly held property, then the city must move faster to make that happen. — Solomon Jones writes commentary for Axis Philly.


29 AUGUST 2013

REGIONSBUSINESS.COM

FINE ESTATES PREVIEW

$2.8M Modern Style Bucks Co. Home Set in the middle of lush greenery is this rare example of modernist architecture by world renowned architect, Paul Rudolph. For 52 years, this three bedroom, two bathroom has been hidden by its very private setting. The current owners, recognized this architectural masterpiece and restored it to perfection. Interior walls were opened, baths redone with quality materials, the kitchen was totally renovated with Pecan cabinets, highend appliances and granite counters. The structure was brought down to the studs in some areas, and new plumbing, windows, central air, heating and roof were also replaced. Masterful gardens were installed with a talented hand and an artistic eye. This home is truly for the avid lover of pure, modernist architecture — a home that has rich provenance and the sensibility of a mid-century modern aesthetic. For more information, please contact Art Mazzei of Addison Wolfe Real Estate at (215) 862-5500

19


20

29 AUGUST 2013

REGIONSBUSINESS.COM

OPINION

Private Exchanges: Value in Health Care Benefits

Jennifer Calhoun-Mohl is a partner in Mercer’s employee health and benefits business, based in Philadelphia, and a regional leader of Mercer’s private exchange, Mercer Marketplace. She can be reached at jennifer.calhoun. mohl@mercer.com

In addition to providing health insurance to America’s uninsured, the Affordable Care Act (ACA) will significantly impact how many employers deliver health benefits to their employees. And here is why: The expected cost increases and administration requirements associated with ACA have accelerated the move by employers to a defined contribution model — one where employees receive a set contribution from their employer that they can allocate among various benefits options. The centerpiece of this emerging definedcontribution model is the private exchange. This virtual “benefits super store” allows employers to offer ACA-compliant health insurance with a new efficiency. A new private exchange can provide access to a range of health plans along with a varied suite of traditional (e.g., medical, vision, dental) and supplemental benefits typically not offered on the public exchange platform. In economic terms, private exchanges allow both employers and employees to realize the benefit of negotiated costs and services. Exchanges also offer complete visibility around the value of an employer’s contribution to benefit costs. These combine to create a positive perception for the organization and its workforce. Here’s a closer look at the value of exchanges viewed through employer and employee lenses.

Employer Value

CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.

It’s worth reemphasizing the bottom-line value proposition for employers. Cost efficiencies of the private exchanges are derived from the streamlined administrative aspects, as well as from the competitive brokering and bundling of all benefit products. Additionally, employees’ benefit-buying behavior leads them to less costly plans that better match their coverage and buying needs. Beyond the immediate cost and administrative benefits, private exchanges facilitate the transition to a DC strategy for benefits, providing full transparency with regard to the total employer contribution to employees’ benefits packages. This can foster a more positive employee perception of the employer, which plays a proven role in employee engagement and productivity, as well as the attraction and retention of key talent. But even employers who choose not to adopt the DC strategy for benefits can take advantage of the administrative efficiencies of private exchanges.

BY THE NUMBERS

Pa. Small Businesses Brace For ACA The National Association for the Self-Employed (NASE) released a key guide, the Affordable Care Act in Brief, to educate and help assist Pennsylvania’s small business community during this transition period.

945,103 Small businesses in Pennsylvania

Employee Value

Private exchanges enhance good will and engagement by empowering employees to personalize their risk portfolios through a technology platform supported by call center-based professional benefit counselors. It’s also important to note that employees tend to have three buying profiles when it comes to making benefit choices. There are those who like to “Do it myself,” those who prefer that someone “Do it with me,” and those who want the organization to “Do it for me.” The privateexchange strategy works for all three of these constituencies, empowering each of them to build their own insurance portfolio. Support for these employee profiles is achieved through a combination of the intuitive, user-friendly nature of a private-exchange technology platform and the personalized service of the benefit counselors staffing the call center. Both methods provide greater visibility into the costs and financial options facing employees. For many, this education process will lead to the realization that they can reduce their medical coverage and costs while still protecting their out-of-pocket exposure. It all points toward an enhanced employee appreciation of their employer’s financial and service commitment to them. Ultimately, private exchanges provide a meaningful long-term solution that overcomes many of the challenges posed by continued changes in the health benefits landscape. In doing so, the establishment of a private exchange also communicates quite powerfully an employer’s continuing commitment to employees’ security, to their evolving needs, and to the availability of quality, affordable health benefits.

772,193 Self-employed in Pennsylvania in 2011

77,156

Self-employed in Philadelphia in 2011

172,910

Micro-businesses in Pennsylvania (businesses with fewer than 10 employees) in 2010

$35.6M

Annual revenue for selfemployed in 2011

$16.3M

Annual revenue for micro-businesses in 2010

20

States that will offer exchanges


21

29 AUGUST 2013

REGIONSBUSINESS.COM

OPINION COMMENTARY FROM ACROSS THE WEB

Philadelphia School Partnership Responds to Recent Kia Hinton and PFT Attacks

A

ction United and its supporters at the Philadelphia Federation of Teachers are spending tens of thousands of dollars to divert the public’s attention away from the real issues at the center of the schools’ crisis. These attacks on Mayor Nutter and the Philadelphia School Partnership ignore the obvious question: When will the PFT step up and be part of a long-term solution that makes schools better for kids? Without meaningful reforms, more money alone would help to maintain a system in which only one in 10 children from low-income communities is graduating college. In Philadelphia, the average public school teacher today earns $110,000 a year in salary and benefits, including free health care, even as starting salaries barely top $40,000. We should be talking first about reining in the runaway cost of benefits. The PFT could agree for its members to contribute 10 percent of the cost of their health care. Other districts around the region already contribute, as do teachers in many cities across the country. In fact, many pay even more. A 10 percent contribution would generate $25 million for our schools. Equally important, the PFT could agree that no teacher hiring or transfer decision at any school could occur without the “mutual consent” of the teacher and the principal. Mutual consent would allow principals to hire and retain the right teachers for the needs of students in their schools, not simply those with the most seniority. It’s the single most important reform that could make a huge positive difference in public schools, and what’s more, it could save millions for the schools by reducing turnover and contributing to staffing efficiency. For the record, we’re trying hard at

WITHOUT MEANINGFUL REFORMS, MORE MONEY ALONE WOULD HELP TO MAINTAIN A SYSTEM IN WHICH ONLY ONE IN 10 CHLDREN FROM LOW-INCOME COMMUNITIES IS GRADUATING COLLEGE. IN PHILADELPHIA, THE AVERAGE PUBLIC SCHOOL TEACHER TODAY EARNS $110,000 A YEAR IN SALARY AND BENEFITS, INCLUDING FREE HEALTH CARE, EVEN AS STARTING SALARIES BARELY TOP $40,000. WE SHOULD BE TALKING ABOUT REINING IN THE RUNAWAY COST OF BENEFITS.’ PSP: We have invested $26 million in public schools over the last two years to improve outcomes for Philadelphia schoolchildren, including nearly $10 million invested in district-run public schools. We’re prepared to do more to achieve a better future for children. But like the Mayor and every other party to this crisis, we’re waiting to see whether the PFT will step up and participate in the plan to fund a meaningful long-term solution that benefits Philadelphia’s children. Misguided and inaccurate attacks simply waste time and money, and do nothing to solve the problem. Our children are waiting, and they deserve better. KRISTEN FORBRIGER

@PhillyCDCs

Need another reason to support @PhillyLandBank? Check out @ AxisPhilly article bit.ly/14U9tcb by @ solomonjones1. Time to act is now.

A JOURNAL OF BUSINESS AND POLITICS

@Uber_Philly

The official line: @GoogleVentures & TPG Capital investing $258 million into our latest round! 26 AUGUST 2013

26 AUGUST 2013

@BenjaminsDesk

@solomonjones1 Far too often, walking the east side of Market St in #Philly is like visiting an insane asylum. We need to fix that.

Huge shout out to @Uber and members, @Uber_Philly for raising $258M from @GoogleVentures! 23 AUGUST 2013

23 AUGUST 2013

@StartupGrindPHL

@EricBoehm87 Yuengling: “We’re not for sale. No one is going to offer me a billion dollars for it, and if they did I wouldn’t take it.”

Tickets are flying out the door to see @bobmoul of @ArtisanMobile for @ StartupGrind at @BenjaminsDesk — got a question in advance, tweet us!

26 AUGUST 2013

26 AUGUST 2013

@melissamdaniels

@bobmoul

Dick Yeungling, who is speaking to the PA Press Club today, is the 359th wealthiest person in the US,

Raising donation for #Philly city schools @ArtisanMobile. Company will match employee donations, and I will personally match total. Your co?

26 AUGUST 2013

26 AUGUST JULY 2013

@Taniel Fascinating trends in suburban PA: In 15 years, GOP’s 35% registration edge in Delaware CO shrunk to... 19 voters.

PHILADELPHIA SCHOOL PARTNERSHIP

REGION’S BUSINESS © COPYRIGHT 2013 INDEPENDENCE MEDIA 350 SENTRY PARKWAY, BLDG. 630, SUITE 100C BLUE BELL, PA 19422 (610) 572-7112 | WWW.REGIONSBUSINESS.COM

Stood out of the open top of a B-17 to take this pic of Philly. Haven’t laughed/screamed that hard since skydiving. @FARFARRAWAY

@IgnitePhilly It is official. Ignite Philly 12 is November 7. Watch for tickets to go on sale October.

27 AUGUST 2013

1 AUGUST 2013

26 AUGUST 2013

EDITORIAL BOARD CEO and President James D. McDonald Managing Editor Terrence J. Casey Associate Editor Rich Coleman

HOW TO CONTRIBUTE To contribute, send comments, letters and essays to feedback@regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business. We reserve the right to edit all submissions for content, style and length.


22

29 AUGUST 2013

REGIONSBUSINESS.COM

BY THE NUMBERS

45%

Employers who are willing — and expect — to negotiate salaries for initial job offers, according to CareerBuilder survey

211

49%

Games that Alex Rodriguez of the New York Yankees will be suspended from due to alleged performanceenhancing drug use

Employees who accept the first offer given to them

43.6%

MLB players that would side with Rodriguez if the suspension were put to a vote with the players, according to a survey by ESPN Magazine

33%

55%

Workers 35 and older who typically negotiate the first salary offer

Employers who base pay by keeping track of what competitors pay comparable employees via job postings

45%

34%

Workers from ages 18 to 34 who negotiate the first salary offer

Employers who base pay by market average reports

54%

35%

Employers who don’t factor in external compensation at all

Men who negotiate the first offer — more likely than women (49 percent) FLICKR.COM/SERCASEY

9,100

Lottery retailers across Pennsylvania

4,500

Instant ticket vending machines throughout Pennsylvania

$5

The most popularly priced instant lottery ticket in 2012

$20

The second most popularly priced ticket in 2012

1,651

“Play Central” terminals, the newest type of lottery vending machines that sell drawbased lottery tickets and instant games, across the state

20%

Players agreed with the 211game suspension

16%

Players who want Rodriguez banned for life

0

Players who said they would have intentionally hit Rodriguez if pitching to him — as some are saying Boston Red Sox pitcher Ryan Dempster did


$50,000 LABOR DAY GIVEAWAY SATURDAY, S ATURDAY, AUGUST 31 – MONDAY, M ONDAY, SEPTEMBER 2

Earn entries towards Labor Day Dollars 8/31 – 9/2 to receive free slot play or match play! 2 entries….$25 3 entries….$75 4 entries….$100

Activate entries on Labor Day to enter the $50,000 Labor Day Giveaway. Twenty winners selected at 8pm, GRAND PRIZE $25,000 CASH!

$55,000 KING OF POP GIVEAWAY EVERY THURSDAY 2PM – 10PM

LIVE BANDS THIS WEEKEND AT 360

WATCH LIVE AT JAX BAR!

FRIDAY, A#Big Bang Baby & DJ Sev One

SATURDAY, A#M

One winner every 30 minutes spins the KING of POP Prize Wheel for SMARTY JONES DAY king-sized AT PARX RACING prizes! MONDAY, SEPTEMBE' GATES OPEN AT 10AM

UFC 164: WORLD LIGHTWEIGHT Enjoy a thrilling day at the races! Free SATURDAY, A#Mark Evans Duo, CHAMPIONSHIP Henderson vs Pettis admission parking, a ParxParkette™ Drawstring Bag*, If you’ve got what it takes to be part of the & World-Famous PARKETTE AUDITION Just Press Play & DJ Eric Vanderslice THURSDAY, A #M BBQ & drink specials, live music cocktail team, meet at the Team Member Entrance at 2pm.** & family fun!

 " 5

MANAGEMENT RESERVES THE RIGHT TO CHANGE OR CANCEL THESE PROMOTIONS AT ANY TIME. MUST BE PRESENT TO WIN. VISIT XCLUB FOR ADDITIONAL DETAILS, RULES AND REGULATIONS. *WHILE SUPPLIES LAST. GAMBLING PROBLEM? CALL 1.800.GAMBLER



Region's Business August 29