Outlook 2019 -- Small Business

OUTLOOK

SPECIAL SECTION

FEBRUARY 24, 2019

SMALL

BUSINESS

BIG

2O19

IMPACT

S2

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WINE

McKenzie Vineyards’ Scott McKenzie pours a glass of wine in the tasting room located in downtown Lodi. [CALIXTRO ROMIAS/THE RECORD]

Care, nurturing and commitment allow family business to grow

By Bob Highfill Record Staff Writer

Scott McKenzie opened the door to his tasting room in downtown Lodi.

It was a Thursday, an off-day, and a cleaning crew was prepping the space on Elm Street for a wine club party that weekend.

McKenzie walked behind the tasting room bar and pulled out some bottles of his family’s work.

The McKenzie Vineyards & Winery Sauvignon Blanc has garnered rave reviews and the 2014 Zinfandel isn’t like any other in Lodi, he said.

“It’s so smooth,” McKenzie said.

McKenzie is a grape grower and does the books and other duties for the winery and the family’s wine grape growing company. He works in the tasting room when he can and lives in Sacramento with his wife and two young children.

It’s a lot.

McKenzie said he and his family knew what they were getting into when they decided to expand their wine grape farming business by starting their label and opening a tasting room.

“We just watched other small wineries do it over the years,” McKenzie said, “and figured if everyone else is doing it why can’t we?”

In the past 20 years, Lodi has seen an increase of wineries and tasting rooms. The region had only a handful, maybe 10 in the late 1990s.

Lodi now has some 85 wineries and 70 tasting rooms total downtown and throughout the Lodi American Viticultural Area.

Spurring the growth are farming families, like the McKenzies, who expanded their business by becoming vintners. Many of the family-owned operations are boutique in size and driving Lodi’s surge to prominence. The rationale behind expansion is twofold: create new revenue streams and raise Lodi’s profile, which in theory, will help increase the value of the region’s fruit.

The McKenzies’ farming

The McKenzie family, which has had a farm in the Lodi area since 1895, owns 250 acres of wine grapes in the Mokelumne River sub-AVA, and produces Sauvignon blanc, Chardonnay, Cabernet Sauvignon and Zinfandel, and soon will release a sparkling wine. [CALIXTRO ROMIAS/THE RECORD]

heritage in Lodi dates to 1895, when Christina and John McKenzie established the family farm.

Today, the family owns 250 acres of wine grapes in the Mokelumne River sub-AVA. For decades, they shipped fruit by train around the country and still sell most of their grapes to outside wineries. But beginning with the 2010 vintage, the McKenzies kept a portion of their bounty for themselves and launched their label and sold their wines through an online wine club that released quarterly.

“Having that consistent income helps out a lot,” McKenzie said.

“Having the wine club semi-established in the beginning helped out a lot.”

With solid wine club sales and mounting recognition from

consumers, the McKenzies had the confidence to ramp up production from 300 to about 1,000 cases annually. They leased space formerly occupied by Riaza Wines in downtown Lodi and opened the tasting room last October.

“Everybody’s been really supportive of us,” McKenzie said. “We have a lot of history here, and we’re learning how to tell it little by little, picking up secrets along the way.”

McKenzie said interfacing with consumers in a tasting room setting requires showmanship, something he didn’t realize entering this new phase.

“Everyone tells you that you have to tell your story and where to do it,” he said. “I’m not as good a storyteller as some people. You have to be outgoing and an entertainer at

the same time. I feel we’re personable and easy to approach. People come in and are greeted with a smile.”

And those smiling faces likely are members of the McKenzie family.

“We’re 100 percent family run and operated,” McKenzie said. “If you’re getting a glass of wine, it’s going to be from somebody with the last name McKenzie. We’re doing everything we can to keep our costs down. That’s helped us out.”

McKenzie crushes about one or two tons of each varietal, so everything in the lineup — Sauvignon blanc, Chardonnay, Cabernet Sauvignon, Zinfandel and a soonto-be-released sparkling wine — are made in small batches at custom crush sites.

“We let the grape dictate where

we are going to go with the winemaking process,” McKenzie said.

“We just roll with the punches.”

McKenzie’s wines are available direct to consumers through the wine club, the tasting room and select outlets. They currently don’t have a distributor.

“That’s our next step, too,” McKenzie said. “We don’t produce that much, but if someone wanted to buy a bunch we could produce it.”

Labeling is a key component in the marketing mix. McKenzie said he wants “Lodi” and the family’s estate single vineyard of origin on labels rather than the more generic “California” appellation, which might sell better but wouldn’t elevate the brand or the region.

“That will help us on the growing side, as well as getting recognition for our vineyards and maybe create a little more premium for our grapes,” he said. “It’s big because the growers are hurting in our area.

We need all the recognition we can get for this appellation.”

The marketing plan also includes more events and live music at the tasting room and engagement on social media.

At present, the McKenzies do not plan to take out a big loan and build a winery. They have a grape growing business to consider, as well. But in five years, McKenzie hopes to be in position to build a standalone production facility, event center and hospitality space, perhaps on family property in Acampo.

“We want to be a destination winery eventually and do events and fun stuff,” McKenzie said.

“And market the best we can.”

Prudent growth with an eye on minimizing costs and exposure to risk — those are some of the tenets the McKenzies believe will ensure long-term success; that and their delicious wines.

Contact reporter Bob Highfill at (209) 546-8277 or jhighfill@recordnet.com. Follow him on Twitter @bobhighfill.

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Sunday, February 24, 2019 |

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E D U C AT I O N

Mike Yonan of the Weber Institute of Applied Sciences and Technology, left, and Ian Ian Dempsey, a corporate trainer with California Truck Centers, talk in 2018 about the new “Get Ahead” program, which gives students opportunities for system certification on a variety of diesel trucks. The focus of programs like the Weber Institute is to prepare the next generation of workers for high-skill, high-wage, and highdemand occupations. [CALIXTRO ROMIAS/RECORD FILE 2018]

Benefits for many in going directly into work world SJ educators preparing next generation for career technical jobs

By Nicholas Filipas Record Staff Writer

STOCKTON — College isn’t going to be for everyone.

Educators throughout San Joaquin County are aware that for some, going straight into the workforce is a better option. While 21st-century careers are flashier, blue-collar jobs like welding and construction are in demand, too.

Has there been a sort of stigma surrounding those who opt to work instead of enrolling at a university?

“I think its losing steam,” said Tony Damele, coordinator in the San Joaquin County Office of Education Career Technical Education department. “Its college/career now, and just getting a post-secondary education doesn’t have to be college, but learning a skill is being more accepted.”

San Joaquin County provides comprehensive CTE programs in both secondary and postsecondary grades and is designed to build academic, career and technical skills needed to succeed in a knowledge and skills-based economy.

The focus of these programs is to prepare the next generation of workers for high-skill, high-wage, and high-demand occupations.

CTE opportunities are available in 10 school districts (Escalon, Lammersville, Lincoln, Linden, Lodi, Manteca, Ripon, SJCOE, Stockton and Tracy unifieds), which directly partner with San Joaquin Delta College through linked learning programs, apprenticeship programs, charter schools or other programs.

One doesn’t have to look far to find a CTE program. Manteca Unified’s be.tech program provides training in food service, law enforcement and medical; woodworking and construction programs are offered at the Engineering and Construction Academy at Lincoln High School; and Get Ahead, offered at Weber Institute of Applied Sciences and Technology through Daimler Trucks North America, offers free web-based course training developed for aspiring industry dealer and distributor technicians.

Officials within the CTE program at the SJCOE meet regularly with various industry professionals to dig deeper into what and how curriculum should be taught to fit

Rudy Elias, right, helps James Frederick High School student James Asborno-Nunes cut steel with a welding torch at the 9th annual Construction Trades Career Fair in 2013. The need for welders is expected to grow by 26 percent by 2020, making welding one of the fastest-growing professions in the country. [CALIXTRO ROMIAS/RECORD FILE 2013]

into the latest trends.

Advisory meetings are also held with district coordinators to determine the best pathways and sectors and can differentiate from district to district.

A harder push for more CTE options was not on the radar for most educators 25 years ago, said John Herger, a SJCOE mechanical construction instructor.

“Everybody was going to college. … it was very much the center of that mentality of little Johnny’s not going to college, put him in a shop class. Then they started killing

shop class and now everybody is freaking out going ‘Who is going to be welding stuff together?’ ” Having a college education is just as important as having a skilled workforce, Herger said, and there’s always going to be a demand for the white-collar jobs; the same can be said for blue-collar jobs.

“The pendulum swung, and in my opinion, it swung too far (to white-collar jobs) and now we’re paying for it.”

Take welders, for example: the U.S. Bureau of Labor Statistics reports that the need for welders

is expected to grow by 26 percent by 2020, making welding one of the fastest-growing professions in the country. The welding industry alone is expected to produce at least 5,000 new jobs each year in the United States, according to the website Fabtech.

“That’s a lot of kids going to work, if you ask me,” said Herger.

The demand for workers also depends on location; welding and other manufacturing jobs are needed in areas like the Gulf Coast in the oil and gas industry.

In San Joaquin County and across

California, Herger said there’s more of a demand for construction, agriculture and technology workers.

“The difference between workers 25 years ago to today (was) although you needed those skills, no college was providing for them, it was done on the job almost like an apprenticeship,” said Anthony McCracken, vice president of product development at Lodibased Scientific Specialties, which manufactures life science research products.

“Companies simply don’t have time or cost structure anymore to train those skills; they rely on the (school) to put in that time and effort.”

Scientific Specialties employs up to 210 and McCracken has hired several Delta College students in numerous positions, from nonskilled manual laborers to programming. Some qualities he looks for in new applicants are those with “very good” computers skills like coding and proper communication skills.

“It really boils down to hard work, willing to work and learn,” said McCracken. “It’s amazing how many people fall in their job interview and expect to be given it all without putting in the effort to learn.”

Among those preparing the next generation of workers is Jeremy Love, a graphic communication instructor at the SJCOE with a focus on arts, media, entertainment and information technology.

“I deal with the at-risk population and alternative education, and these kids don’t even imagine that they can go to college,” he said.

One success story that Love recounted was a male student who really loved graphic design and had a passion for skateboarding.

Taking the skills learned in video production, the student made YouTube videos of himself and eventually was sponsored by several skateboarding companies.

“I’ve seen the way that students’ eyes light up, because this is possible,” Love said.

“CTE is becoming embedded in the high schools more and I think it’s going to become one of those things that any high school would be considered negligent if they don’t have a CTE program of some sort.”

Contact reporter Nicholas Filipas at (209) 546-8257 or nfilipas@ recordnet.com. Follow him on Twitter @nicholasfilipas.

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Sunday, February 24, 2019 |

S5

BANKING

Community banks living up to serving the community

By Jordan Guinn Special to The Record

Small businesses getting loans and financing from local banks is a cornerstone of free enterprise.

In these instances, investment stays within the community, and both the business and lending institution prosper.

While entrepreneurs have options when seeking a line of credit or a loan for construction, commercial real estate or agriculture, their best bet might not be with the Bank of Americas, Citibanks and Wells Fargos, but with that community bank that’s been around the corner for decades.

“At a community bank, customers can talk to bank ownership and management,” said Janet L. Jenkins, executive vice president at Bank of Agriculture and Commerce Community Bank.

“Community banks can be a consultant that provides feedback and advice.”

That’s why Paul Schneider, principal and vice president of Siegfried Engineering, sought out BAC when seeking financing for his firm’s new corporate headquarters. For about a decade the Siegfried Engineering had been leasing office space, but the long-term strategy involved moving into a building that they owned. The company closed the deal on a building in Brookside in December and plans to move in after renovations are completed in April.

“I never had a question that we would would work with BAC,” Schneider said. “We’ve worked with them for 20 years — I’ve never known a time when they weren’t our bank.”

Schneider’s sentiments are echoed by Josh Iris of Ace Electric Motor Co., who recently secured a line of credit from Farmers & Merchants Bank. Iris said he considered working with a larger institution, but ultimately decided it wasn’t in his best interest.

“I looked briefly; like 15 minutes. My gut told me it was not the direction I needed to go,” Iris said. “I will take smaller and local any day. I did not want to have to

The Bank of Agriculture and Commerce at 2001 March Lane, Stockton. [CLIFFORD OTO/THE RECORD]

go see my banker through bulletproof glass and end up just some number.”

Ace Electric Motor Co. used a line of credit to fund a marketing campaign, beef up their inventory and have access to more working capital.

Securing financing to start a business, keep an existing one afloat or expand operations can be stressful. Fortunately, community banks and community outreach programs exist to educate and assist those seeking funding.

The Northeastern California Small Business Development Center at San Joaquin Delta College offers consulting, training

and resources for exactly such purposes. In addition to connections with local financial institutions, the center can direct small businesses toward various financing options, like the Downtown Stockton Enterprise Loan Fund or the City of Stockton Small Business Micro Loan Program.

Businesses from a variety of sectors come to the center for advice and direction, said Nate McBride, director of the Northeastern California Small Business Development Center at Delta College.

“We’re a public service agency, and we see a broad spectrum

come through the doors,” he said.

“I’d say there’s a leaning toward service-type businesses, or people trying to conduct business online with a virtual storefront.”

Small businesses have been particularly active seeking financing, according to Mary Elizabeth Eberhardt-Sandstrom, vice president of consumer banking at Bank Of Stockton.

“We are seeing an uptick in small business loan requests across the board, many for general small businesses, such as those that employ one to 10 employees,” she said. “We are also seeing an increase in the construction sectors, farm sectors and

nonprofits.”

Both Iris and Schneider point to the human element as driving factors in their decision to bank locally. They wanted to work with people who live in their community and have a vested interest in their success.

“They know who we are by name. They have a shared stake and want to help create a mutually beneficial relationship,” Iris said.

“There’s nothing like being able to walk into your bank and have people you know who support and care about you and your business.

They have been a huge part in helping our business continue to grow.”

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R E S TA U R A N T S

Fork It, a farm-to-fork café, opened late last year on Pacific Avenue in Stockton. [PHOTOS BY BOB HIGHFILL/THE RECORD]

Lots of work with lots of love Dedication, attention to detail a hallmark of thriving local restaurants

By Bob Highfill Record Staff Writer

Amy Reyes knew opening a restaurant wouldn’t be easy.

Ike Victoria knows how tough it can be to own a restaurant, having operated eateries in the past.

But something deep inside, a feeling neither fully could explain, compelled them to open establishments in Stockton.

“Mostly it’s because I just wanted to share my love of food and my food,” Reyes said. “I get a big kick if I see that you are really enjoying my food. I get a good feeling.”

Said Victoria, “I love this work. I can’t believe I get paid to do it.”

Reyes and her husband, Jesus, opened Reyes Deli & BBQ about one year ago in a shopping center on Hammer Lane west of Interstate 5 in north Stockton. Victoria, who works alongside his 17-year-old son Kian, opened Fork It, a farmto-fork café, two months ago on Pacific Avenue.

Conventional wisdom says most restaurants don’t make it past the first year, but there isn’t consensus on the failure rate. American Express claimed in an advertisement that 90 percent close in the first year. Restaurant Startup & Growth magazine commissioned a survey that indicated a 23 percent first-year failure rate.

Forbes reported a study by two economists that tracked singleestablishment restaurants from 1992-2011 and found 17 percent closed in the first year, a lower rate of failure than other service businesses, such as real estate agents and brokers (21 percent) and landscapers and automotive repair (19 percent).

No matter the numbers, Victoria said restaurants are a risky business and require capital, business acumen, time, talent and energy.

“It’s not just open a restaurant,” Victoria said. “You have to know the business part. If you don’t know the math, the marketing and all of these different things it’s not going to work.”

George Lucas, who recently sold Yosemite Meat Market and Deli after 28 years, said one factor that played into his success was, “being the face when people walk in. They come in and know you’re there and you treat them like family, and the food’s always good and always fresh.”

Lucas said some restaurants fall into trouble by doing too much too early.

“You have to start from the beginning and build,” he said. “It just doesn’t happen. It takes a long time to get the respect from your customers, and I think it’s something you have to work on every day.”

Reyes had no experience running a restaurant but decided to follow her passion after working in the insurance business for two decades.

“For many years I did insurance, but I was so tired of it,” she said.

“So, instead of opening an agency, I decided, hey, let’s go into the business. That’s really it. I just gave it a shot because I wanted to do something with my life. I wanted to leave

Ike Victoria, right, owns Fork It and his son Kian, left, works at the restaurant.

something for my (two) daughters.”

Reyes said the restaurant business has been harder than she imagined. She said even her aunt, who has owned a Mexican restaurant for many years in Stockton, didn’t fully convey the challenges.

“It’s a very tough business,” said Reyes, “and the thing is when you go out and have dinner, you don’t see what goes on behind the scenes.”

Reyes described her menu as “Cali-Mex” and said her dishes reflect the diversity of California and her Mexican heritage. Jesus Reyes, a third-generation meat cutter, slow-cooks meats over a large wood-fire grill just as he did when he operated Reyes Carniceria Deli & BBQ at Alpine Market on California Street.

“Everything is freshly made daily,” Amy Reyes said of her restaurant, open from 8 a.m.-8 p.m. daily. “Even the onion rings. ...

Fresh, that’s my label.”

Victoria said he fell in love with food and cooking watching his mother work in commercial kitchens.

“I was in awe of her that she was in charge of such big equipment and all this stuff was so huge,” Victoria said. “I was like, ‘I can’t wait.’

That’s how I got started.”

Victoria managed a Pizza Hut when he was 16 years old and worked several years as a private chef. He owned restaurants in Folsom, Weston Ranch (Remo’s) and Stockton (Shadow Oaks Steakhouse). Victoria said about a year ago, he discovered a vacancy on the Miracle Mile and put in a bid.

Another two dozen entities were interested.

“I went in and put down an offer and it came down to résumé and menu,” Victoria said. “Prime location, the Mile. It’s doing well so far.”

Fork It is open from 11 a.m. to 8 p.m. Tuesday through Thursday and 11 a.m. to 9 p.m. Friday and Saturday.

Restaurant ownership, like any small business, takes hard work, dedication and attention to detail.

Sometimes, that isn’t even enough.

“You have to love this work,” Victoria said.

Contact reporter Bob Highfill at (209) 546-8277 or jhighfill@recordnet.com. Follow him on Twitter @bobhighfill.

Amy Reyes, right, owns Reyes Deli & BBQ in north Stockton, and Lucy Rodriguez, left, is the chef.

Jesus Reyes mans the grill at Reyes Deli & BBQ in Stockton.

Reyes Deli & BBQ opened about a year ago in a shopping center on Hammer Lane in north Stockton.

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Sunday, February 24, 2019 |

S7

H E A LT H C A R E

Providing health insurance can be a challenge for small businesses

By Joe Goldeen Record Staff Writer

STOCKTON — Providing employer-sponsored health insurance presents a conundrum for many small businesses. The expense has little to do with contributing directly to the bottom line, but it’s proven to be good for attracting and retaining skilled workers.

A recent survey of employers who use the Covered California for Small Business exchange indicated that prospective employees expect to be offered health insurance.

After salary, health insurance is the next consideration employees use to base their decisions on whether they work for one employer over another, the survey showed.

However, for employers offering at or near minimum wage to their workers and struggling with all the hurdles of just keeping the doors open and the lights on, health insurance is barely on the table.

“If you are a small business, you have no buying power whatsoever. We are at the mercy of the insurance companies,” said Mike Letizia, president and CEO of Stockton-based Letizia HR Solutions Inc., who described his two-person shop as a full-scope human resources service provider.

Letizia himself has more than 30 years’ experience in human resources, much of that time spent with a local bank.

Small employers with less than 50 full-time-equivalent workers are exempt from the federal mandate that they must provide coverage to their workers. But there is still an incentive for some if they do provide employer-sponsored coverage.

The Small Business Health Care Tax Credit is equal to 50 percent of the premiums paid by an eligible business with less than 25 employees. So if the business shells out $15,000 in premium costs, it could be entitled to a $7,500 tax credit from the Internal Revenue Service.

For small businesses, like these in a shopping center along the 1100 block of Waterloo in Stockton, the expense of employer-sponsored health insurance is prohibitive.

[CALIXTRO ROMIAS/THE RECORD]

Businesses do have the option of enrolling with Covered California for Small Business, or CCSB, part of California’s State Health Benefit Exchange where employers with 100 or fewer workers can access health plans that are relatively affordable.

CCSB currently offers five plans, including two preferred provider organization (PPO) plans from Blue Shield of California and Health Net, and two health maintenance organization (HMO) plans that are provider- and hospital-based from Kaiser Permanente and Blue Shield.

For employers concerned about premiums, Covered California spokesman James Scullary said “there is no business too small for our plans, and CCSB is seeing a substantial increase in the lower

end of small businesses — in the two- to 10-employee range — now offering health insurance.

Interested employers can visit CoveredCA.com or call us at (844) 332-8384 for more information.”

Letizia won’t be one of those calling, however.

“I would really love to offer my employee health benefits,” he said. “But Covered California does not measure up. That’s not health coverage, at least certainly not what I am used to,” Letizia said, referring to what he described as low-premium “catastrophic policies” with “unrealistic” four-figure deductibles.

“The quality of health care I received 15 to 20 years ago simply does not exist today,” he said.

While CCSB may be attracting

more small business operations, a recent random survey of independent businesses in one Stockton shopping center did not find a single employer offering coverage through the state exchange. In fact, the results were startlingly consistent. Not a single employer in the center offers health insurance benefits, period.

One simply said, “No insurance,” waving off further questions.

Another noted his status as a military veteran eligible for VA health care.

Several employees shared that they were receiving governmentfunded Medi-Cal (California’s version of federal Medicaid benefits) through Health Plan of San Joaquin. Even though they were all working, they met the income

eligibility requirements because of their low wages.

Muhammad Sultan, 55, who holds a master’s degree in geography and worked as a high school principal in his native Pakistan before moving to San Joaquin County in 2010, now works in a friend’s smoke shop. He has MediCal for his entire family of five, including his oldest child who also works.

“I like it. It works for me,” Sultan said. “We are happy with Health Plan of San Joaquin and have no problems. I can pick any doctor with no problem.”

Contact reporter Joe Goldeen at (209) 546-8278 or jgoldeen@recordnet.com. Follow him on Twitter @JoeGoldeen.

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SPORTS

Stockton provides G-Kings with home-court advantage

By Scott Linesburgh Record Staff Writer

STOCKTON — The Stockton Kings, the minor-league affiliate of the NBA’s Sacramento Kings, moved from Reno to Stockton last spring, hastily set up a front office organization and began playing at Stockton Arena in November.

With a few months left in the season, the team is looking forward to a full offfseason of preparation to sell its NBA G League product “When you are marketing a minor-league franchise, it’s 100 percent about understanding the community,” Dustin Toms, the team’s vice president of business operations, said. “When you are a major-league team, people are going to want to come to you games because they can want to watch LeBron James, or they want to watch Tom Brady.

They are going to drive those tickets for you. But at the minor-league level, you are never really going to have that.

But what you can do is focus on the community.”

When the G League franchise came to Stockton, it brought one employee — Toms, who was also vice president of the Bighorns.

The franchise opened the season on Nov. 2 with a sellout crowd of 5,203 against the Oklahoma City Blue, and is averaging about 2,000 fans per game. Toms, who has a 10-person staff based in Stockton plus marketing support from the parent franchise in Sacramento, said he believes the Kings are off to a good start considering the time restraints faced initially.

“With the move, we got off to a late start. We started selling tickets for the upcoming season in May (2018), while most franchises started in January. So we’re looking forward to having this season and full offseason to work,” he said.

The Sacramento franchise announced on April 9, 2018, that it was moving its G League operations from Reno, where the team had been located since its inception in 2008, to the Central Valley. The Kings were associated with what was known as the Reno Bighorns every season and bought the G League franchise outright in 2016.

Location was the key reason for moving the team to Stockton. The drive between Reno and Sacramento takes nearly three hours in good weather and can be treacherous during winter storms. Stockton Arena is 48 miles from Golden1 Center in Sacramento, where the Kings play and have their home offices. The G-Kings practice at the training facility next to Sleep Train Arena in Natomas.

“One of the big reasons (for the move) was the proximity to Sacramento,” Toms said. “It’s much easier to develop players. Vlade Divacs (Sacramento Kings vice president of basketball operations and general manger) and Peja Stojakovic (player personnel director) have been to almost every home game. And they are sitting courtside, which some of our season-ticket holders just love. They never know who they are going to see.”

In the end, Toms said the Stockton Kings' success will come down to how well the team can connect to the fans and potential sponsors in Stockton. He and his staff continue to go out and meet people, become involved in community events and set meetings with local business operators.

“Every town is different, so you have to get to know the people you want to support your team,” Toms said. “The people I Stockton have been very supportive and friendly to us.”

Contact reporter Scott Linesburgh at (209) 5468282 or slinesburgh@recordnet.com. Follow him on Twitter @ScottLinesburgh.

Anthony Walker (44) and the Stockton Kings have gone over and above first-season expectations at Stockton Arena after a late franchise move from Reno. [CALIXTRO ROMIAS/RECORD FILE]

Dustin Tomas, the Kings’ vice president of business operations, the only employee brought with the franchise from Reno, says focusing on the community is key to a minor-league team’s success. One of those bonds was the introduction of Dunkson, the mascot. [CALIXTRO ROMIAS/THE RECORD]

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Sunday, February 24, 2019 |

S11

M I R AC L E M I L E

From humble beginnings to 100 years of commerce Storied Miracle Mile is a unique, diverse shopping district

By Roger Phillips Record Staff Writer

STOCKTON — Though the centennial is still three years away, the leaders who oversee the Miracle Mile are beginning to think about the how to celebrate the neighborhood’s 100th anniversary.

The history, based on The Record’s archives and on research conducted nearly a decade ago by preservationist Joy Neas, has been colorful: • What would become the Miracle Mile originally was annexed by voters and at the time it became part of Stockton it was the city’s northernmost neighborhood.

• The Miracle Mile, according to accounts, was named after Los Angeles’ Miracle Mile, a tree-lined stretch of Wilshire Boulevard.

It was the idea of developer Joe Plecarpo.

• By the 1950s, the Miracle Mile had become one of the city’s busiest

shopping districts. Favorite spots lining the Miracle Mile included the Milky Way malt shop, Konrad’s soda fountain, Gaines Market, and clothiers like Bravo-McKeegan and The Brown House.

Choosing 2022 as the centennial year probably is a rough estimate.

In fact, one article in The Record's archives says, “When exactly shops and homes gelled into the district is loosely pegged to 1921.”

Regardless, the Miracle Mile today maintains its special character.

“The Miracle Mile is very unique,” Kim Byrd, president of the board of the Miracle Mile Improvement District, said recently. “It has different personalities. It’s eclectic. I think that’s what makes it special to the community.”

A dizzying series of events has marked much of the Mile’s past two years, including the shuttering of the Empire Theatre and resignation of two executive directors.

Some 100 years after its creation on Pacific Avenue, the Miracle Mile maintains its special character. [CLIFFORD OTO/RECORD FILE 2017]

Byrd said the MMID’s board is preparing for a meeting next month where the focus will be on developing a “strategic plan.”

“There are a lot of irons in the fire,” said Byrd, owner of Moore’s Chinese Martial Arts & Yoga Dojo in the heart of the Miracle Mile.

“We’re not skipping a beat.”

Byrd, 52, said she is hopeful progress will be made this year with regard to the Empire Theatre.

Regardless, though, she said the Mile will remain a focal point in the city nearly 100 years after its humble beginnings.

“It’s not one size fits all,” Byrd said. “It’s not beige. It has a lot of

color and diversity. I think that’s what makes it special to the community. It’s important to me that it thrive.”

Contact reporter Roger Phillips at (209) 546-8299 or rphillips@recordnet.com. Follow him on Twitter @rphillipsblog.

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A G R I C U LT U R E

Ken Fogel harvests walnuts in his orchard east of Stockton along Duncan Road in October 2017. Prices of some of the region’s most prominent commodities, including walnuts and dairy, have plummeted, putting a further strain on area farmers. [CALIXTRO ROMIAS/RECORD FILE 2017]

Farmers face tough economic conditions

By Jordan Guinn Special to The Record

San Joaquin County farmers are battling their share of obstacles.

Prices of some of the region’s most prominent commodities such as walnuts and dairy have plummeted, the labor pool is dwindling, and more stringent environmental regulations have created wafer-thin margins for area farmers.

“We see a lot of positives in the overall economy, but the agricultural economy isn’t showing that,” said Bruce Blodgett, executive director of the San Joaquin Farm Bureau. “It’s hard to find any commodity that’s doing well.

Wine grapes, almonds, walnuts and dairy — those are our top four commodities — and they’re all struggling.”

Toss in a tumultuous trade war with new environmental regulations and it becomes easy to see why farmers are scraping in a county where 58 percent of the land is devoted to farming, with more than 3,500 farms covering 518,000 acres, according to the San Joaquin County Agricultural Commissioner’s 2017 Annual Agricultural Crop Report.

The county has been California’s leading producer of walnuts for more than two decades, and the 2018 harvest yielded a record-setting 690,000 tons, according to the California Walnut Commission.

But instead of being packed into shipping containers headed for China, India and Turkey, the

Rainer cherries for sale at the farmers market behind Weberstown Mall in 2017. [CLIFFORD OTO/RECORD FILE 2017]

bulk of the state’s walnut crop awaits an unforeseen fate, as retaliatory tariffs zeroed in on the commodity.

There are ongoing attempts to coax other countries into buying agricultural commodities as trade negotiations between the United States and China are hammered out, but that process takes time to develop, said Annie AcMoody, director of economic analysis for Western United Dairymen.

“Finding an export market can

take years to build,” she said.

San Joaquin County farmers are also feeling the squeeze from the state’s environmental regulations.

“The combination of air quality and water quality regulations put immense pressure on agriculture,” Blodgett said. “There’s no other country, no other state with anything like it. It’s so costly to do business in this state that we’re seeing people pulling up stakes and leaving for

Walnut being harvested at Ken Fogel’s orchard east of Stockton along Duncan Road. [CALIXTRO ROMIAS/ THE RECORD FILE 2017]

elsewhere.”

Blodgett points to Senate Bill 100 as particularly harmful to the agricultural industry. SB100 requires half of the electricity generated in the state to come from eligible renewable sources by 2030, and also sets 2045 as the deadline for all-renewable or zero-carbon power generation.

“The bottom line is, that as they continue to put out mandates, it drives the price of energy up,” he said. “The folks in

Sacramento seem to think agriculture is OK and we can handle all the regulatory burdens they want to put on us.”

Blodgett highlights a stark statistic that demonstrates how much the dairy industry in particular has suffered in San Joaquin County over the years.

“Since 2005, I’ve only seen one application to expand a dairy in our county,” he said. “One.” Roughly a third of all the milk produced in California is exported, and trade disputes with Mexico and China — two of the four biggest importers — is a cause for concern, AcMoody said.

“We’ve been hit by the tariff at the wrong time,” she said. “It’s really started to create concern.”

If those challenges weren’t enough, the area’s farm owners have struggled to find enough people to work the fields. Blodgett supports the Agricultural Worker Program Act, which would grant legal “blue card” status to guest workers who have labored in agriculture for at least 100 days during the past two years.

But, he said, the legislation doesn’t solve the larger problem: More workers are needed.

“We have a shortage of labor.

We need a new source of labor moving forward, not just a source of labor that is here right now,” he said. “I look at the legislation as incomplete. Without a guest worker program, it doesn’t solve the problem. We need folks to come in legally and work.”

Diary cows at the Van Excel dairy along I-5 and Turner Road near Lodi. [THE RECORD FILE 2012]

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Sunday, February 24, 2019 |

S13

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LEGALIZED CANNABIS

Could SJ become a marijuana epicenter?

Recreational cannabis market brings huge tax revenue opportunity

By Roger Phillips Record Staff Writer

STOCKTON — In November, adult-use cannabis dispensaries became a budding business in Stockton.

Within days of each other, three already-existing medical cannabis dispensaries became the first legal distributors of recreational marijuana in the city — two years after voters approved legalization statewide.

The Stockton dispensaries report that business is going well and that customers cannot be placed into any single age demographic. And not everyone who comes in to buy has been looking to get high.

“In general one of the biggest growths in the market is senior citizens,” Mike Carlson, the proprietor at Port City Alternative, said last month. “They don’t want to smoke.

They want to ingest. They’re trying to get off (prescription) medications. They’re looking for other options.”

Layla Rabah, general manager of Connected Cannabis in east Stockton, said last month that the city’s legal dispensaries are bringing new tax revenue into town that previously was going elsewhere.

“Before, the city of Stockton was losing a lot of sales because of the fact that we had surrounding dispensaries in other cities (like Sacramento),” Rabah said.

“I believe our residents here in Stockton were commuting to other cities to purchase.”

Now, though, those wishing to purchase legal cannabis in San Joaquin County have three options, all in Stockton. The rest of the county and its cities are lagging behind, with no legally operating dispensaries.

Sixty-three percent of San Joaquin County voters last year supported taxing and regulating legal cannabis businesses in county pockets, but the measure fell just shy of the two-thirds vote needed for approval. Afterward, the Board of Supervisors approved a regulatory framework that will allow the county to reach development agreements to entitle would-be legal cannabis businesses in county pockets.

Stockton attorney Zach Drivon,

Non-alcoholic, cannabis-infused beverages are available from the Lagunitas Brewing Company. Those wishing to purchase legal cannabis in San Joaquin County have three options, all in Stockton. [ROGER PHILLIPS/THE RECORD]

whose practice focuses on cannabis issues, says the tax-revenue possibilities for the county and its cities are enormous.

For instance, four cultivation sites have been approved in Stockton, creating the opportunity for more city tax revenue once they are operating. Two additional legal dispensaries also are moving toward their opening days within city limits.

“Legalization on a federal level could make us an epicenter for nationwide distribution, as well as shipping cannabis as a globally

traded commodity across the Western hemisphere through the Port of Stockton,” Drivon said.

“The positive economic impact this could bring to our community is nothing short of profound, given that the national cannabis market is projected for a $20-plus billiondollar value by 2022.”

Drivon added that it is “crucial” for city and county leadership to maximize opportunities in the cannabis sector — dispensing, growing and testing — so the region can take full advantage.

“By creating a level playing field

and eliminating barriers to entry for legal businesses, our local governments can provide opportunities for investment into our local economy and employment opportunities for our residents,” he said.

Additionally, Drivon predicted, the city and county will continue to take “a measure approach” to permitting new cannabis businesses in the coming year.

“With positive results in the performance of these businesses, along with an acknowledgment of the value of cannabis as an agricultural

commodity, hopefully our local policies will continue to evolve to realize the potential this industry carries for the San Joaquin Valley region and the city of Stockton,” he said.

“Cannabis, whether one cares for it or not, is a mainstay in society and something that is generally better regulated than left to illegal markets.”

Contact reporter Roger Phillips at (209) 546-8299 or rphillips@recordnet.com. Follow him on Twitter @rphillipsblog.

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Sunday, February 24, 2019 |

S15

R E A L E S TAT E

A real estate reality check

What you should know know before becoming a real estate agent

By Jordan Guinn Special to The Record

Cable television’s proliferation of shows about property flipping and residential real estate might have you considering a career as a real estate agent.

While it can be an exciting, rewarding and, yes, lucrative, field, it’s one that requires substantial effort and diligence to be successful, according to Debbie Mason of Keller Williams Realty Central Valley.

“It takes grit, passion, perseverance and hard work,” said Mason, who also serves as an at-large director for the Central Valley Association of Realtors. “You have to put in time and you have to learn the market.”

It takes about six weeks of studying to prepare for a real estate exam, Mason said. Some pass the test on their first try, while others may not.

In that case, test takers would need to put in some more hours studying in order to obtain their license.

Once a real estate agent obtains a license, they need to find a brokerage to affiliate with. This process takes time, and Mason said new real estate agents would be wise to consider a number of factors before joining an agency.

“If you’re new, you might want to go to an office that offers training, or a mentoring program,” she said.

“You might want to join a team where a real estate agent is giving you leads so you can work your way up.”

In addition to a hearty work ethic, it helps to have a vast network of experts to lean on, Mason said.

A professional photographer, for instance, is one example of a musthave in your Rolodex.

Websites like Zillow, Redfin and Trulia allow potential buyers to take virtual walk-throughs of homes.

Pictures taken with a smartphone don’t show nearly as well as ones taken with professional equipment, she said.

“If you want to impress a client, use a professional photographer,” Mason said.

Mason also relies on home stagers from time to time — professionals

Real estate can be an exciting, rewarding and lucrative field, but it takes hard work and diligence to be successful, insiders say. [RECORD FILE 2014]

who fill a vacant home with furniture and artwork so would-be buyers aren’t looking through photos of empty rooms.

Compensation is another key factor for new real estate agents searching for a brokerage. Real estate agents are paid on commission, and not all brokerages pay the same.

“Your commission could be split 70⁄30 or 60⁄40 with the brokerage,” Mason said. “Some firms have a cap structure, which allows you to keep 100 percent of the commission after

you surpass a certain point.”

The most successful real estate agents are experts in their market, so Mason suggests newbies pick a specific region and focus on it.

Monthly newsletters are a great way to educate potential clients, and there’s no replacement for face-to-face interaction.

“Once you’re familiar with an area, knock on doors an introduce yourself to residents,” Mason said.

“Let them know you are the neighborhood expert.”

Communicating with clients is a

vital portion of the job, and Mason stresses the importance of clear communication and expectations from the start.

“When clients interview a Realtor they should ask them questions about their marketing strategy and what they can expect,” she said.

“I’ll put together a presentation that outlines the marketing strategy for the home. After that, the client needs to trust you to do the job they hired you to do.”

Being a real estate agent can be an around-the-clock job, so it’s

important agents set firm boundaries with their time to avoid being overwhelmed or getting burnt out, Mason said.

“For me, Sundays are my day for family time and I try not to answer my phone,” she said. “Or I will set boundaries by saying I don’t take calls after 7 p.m. A lot of real estate agents will start out and work 24/7, but not having a balance between career and life could ruin relationships and family time. You have to live your life as well,” she said.

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