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Volume 3 l No. 4

www.cvbusinessmonthly.com

BUSINESS MONTHLY columns Page 6

Jim Offner Real estate is the only sound investment.

Page 11 Business etiquette Thank you notes leave a lasting impression.

Page 21 University of Northern Iowa Businesses can be socially responsible in bad times.

Page 23 Wartburg College Retirement village sprouts near campus.

Page 42 Small business Stimulus plan offers little direct help. RICK TIBBOTT / Courier Staff Photographer

BUSINESS MONTHLY staff directory EDITORIAL CONTENT Nancy Raffensperger Newhoff nancy.newhoff@wcfcourier.com (319) 291-1445

ADVERTISING Jackie Nowparvar jackie.nowparvar@wcfcourier.com (319) 291-1527

Jim Offner jim.offner@wcfcourier.com (319) 291-1598

Sheila Kerns sheila.kerns@wcfcourier.com (319) 291-1448

Cedar Valley Business Monthly is published monthly. It is a free publication direct-mailed to more than 6,500 area businesses. For distribution, call Courier Communications at (319) 291-1527. Contact Cedar Valley Business Monthly at P.O. Box 540, Waterloo, IA 50704.

BUSINESS MONTHLY on the cover RICK TIBBOTT / Courier Staff Photographer

Harold Youngblut at the Mauer Eye Center in his Greenbelt Centre development along Ridgeway Avenue in Waterloo.

Harold Youngblut in front of the newly completed Mauer Eye Center, one of the first projects in Youngblut’s Greenbelt Centre development in Waterloo.

Developing dream Greenbelt Centre perking along in murky economy By JIM OFFNER Courier Business Editor

WATERLOO — The real estate market may be hurting across the country, but there appears to be a lively island of growth in the middle of the Cedar Valley. It’s called the Greenbelt Centre. The 122-acre project, a fouryear dream of developer Harold Youngblut, has been taking shape near the intersection of U.S. Highway 63 and U.S. Highway 20, adjacent to the old Waterloo Greyhound Park. The site’s location, in keeping with the old real-estate maxim, is key to the development’s growth, Youngblut said.

“It’s a wonderful location,” said Youngblut, who already has invested about $3 million into the project and plans to pour in about $2 million more. The centerpiece is Mauer Eye Center and D’Vine Medical Spa’s gleaming new $6 million complex along Ridgeway Avenue. The Mauer facility occupies the equivalent of five lots in the 60-lot development, Youngblut said. A Gold’s Gym was built across the street, occupying about six lots. A $1 million facility for CraftCochrane Screen Printing & Embroidery is coming next, followed by new offices for Waterloo’s Social Security branch.

“We envision 50-60 businesses being located in that area,” Youngblut said. The development will have some sense of organization, Youngblut added. “The west portion of the Greenbelt Centre is mainly going to be focused on a medical atmosphere,” he said. “Dr. Mauer obviously was a key to starting that, and what a beautiful building he put up. Our goal is to surround his building and that area with health-oriented businesses.” The Mauer Center opened in December. See GREENBELT, page A5


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GREENBELT From page 3

“The building had to embrace the community, a place where people can go to find refuge,” Dr. Richard Mauer said when the building opened. “This is more than the Mauer Eye Center, it’s a community center.” Two other buildings are under construction nearby. More are on the way, Youngblut said. “In the next 30 days we’ll be closing on another project which will start as soon as the weather is suitable,” he said. The latest to sign on is TurnKey & Associates, an architecture design firm, which Youngblut said would sign a contract by early or mid-March. TurnKey & Associates will construct a brick building between 10,000 and 15,000 square feet the corner of Greyhound and Ridgeway on the east side of the development, Youngblut said. He he anticipates leasing all the space when the project is fully developed. “I firmly believe a hotel will locate at that interchange,” he said. “Highway 63 and Highway 20 is highly traveled and visible intersection. I feel pretty optimistic a hotel will choose that site.” Once those types of businesses move into the area, even if they’re not located on Greenbelt property, it could generate a critical

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mass that could draw businesses like a magnet, he said. “Following most hotels is a restaurant and, whether it’s an IHOP or a Denny’s-type,” he said. “Those type of restaurants are drawn to hotels.” He envisions a convenience store in the area, as well. Youngblut said he has received a lot of inquiries. “I’d say the most interest I have now is medical fields wanting to locate next to the Mauer Eye Center,” he said. “Who wouldn’t be want to be beside a beautiful $6 million office building?” The Greenbelt Centre is Youngblut’s first foray into real estate. However, he said, he has had plenty of guidance. “At times, it is very overwhelming,” he said. “But, I feel I’ve been very fortunate in the advice I’ve sought from local experts, such as Cork Peterson of PCI, Rick Morris from Beecher (Beecher, Field, Walker, Morris, Hoffman & Johnson PC law firm) and Ken Lockard from Lockard (Cos.). Those are experienced businessmen who were extremely gracious in giving advice.” Youngblut also said the Waterloo city government has provided crucial assistance in securing a $324,000 Iowa Economic Development grant for street construction in the development. “Our city has really helped me a lot in this development in seeking out, helped me with a grant

that put in the very first part of my streets,” he said. Youngblut said he is not intimidated by a downturn in the real estate market, although he knows these are challenging times.

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“All businesses are used to challenging times and, as our new president says, we will overcome this, and we will have to work harder and longer. But I have full faith that the Cedar Valley will

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remain as an excellent location for businesses of all sizes to operate in.” Contact Jim Offner at (319) 291-1598 or jim.offner@wcfcourier.com.


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In the Cedar Valley at least, real estate remains a sound investment Someone once said real estate is the only safe investment. My father-in-law noted that maxim after he bought his seventh rental property. He was a man who believed in himself. A self- employed entrepreneur, he Jim Offner owned his own is the Courier barbershop and business editor. ran it himself for Contact him at decades. (319) 291-1598 or But this isn’t jim.offner@ about him. I wcfcourier.com. think I’ve said enough about my father-in-law over the years. This is about what he said. “Real estate is the only safe investment.” Some might argue that point in the fallout of Wall Street and the mortgage mess sub-prime lenders created. In some areas of the country, property values have plunged to half of what they were only five years ago.

Of course, some areas have taken harder hits than others. Here in the Cedar Valley, we’ve said over and over, the real estate market has not suffered the same fate other markets have. All the more reason to peruse this month’s issue of the Cedar Valley Business Monthly. As the cover story on the Greenbelt Centre illustrates, the Cedar Valley remains a land of opportunity. Expansion at John Deere, the upcoming opening of the first phase of the Cedar Valley TechWorks project, Target’s new perishable distribution center and the renaissance of both major downtown districts in the metro area give testament to the notion that the area continues to grow, regardless of economic conditions across the country. The Cedar Valley housing market has remained strong, especially compared to other markets nationwide, even across the Midwest. Dick Robert, broker and owner of Cedar Falls Real Estate Co., reported only a “slight decline”

in the average sale price and the total number of sales of detached single-family homes, as reported through the Waterloo-Cedar Falls Board of Realtors. “I continue to be impressed with the strength and diversity of our local economy,” Robert said. He remembers tough times in the 1980s, when it wasn’t rare to have 350 houses for sale in Cedar Falls and more than 1,000 in Waterloo. By comparison, as of mid-January, thee were 145

houses on the market in Cedar Falls and 442 in Waterloo. The average sale price for homes in Cedar Falls slipped 1.5 percent and 5.17 percent in Waterloo between 2007 and 2008. That as much as anything says things may not be great here, but they’re certainly not terrible. Investors must recognize there are opportunities in the Cedar Valley. Business is perking along. Banks are lending mortgage money. There are signs of hope

that tough times, while difficult in the present, may not have that much of a future. Read what some of the area’s real-estate and investment experts have to say about the current climate in the region. They offer plenty of advice on how to take advantage of tough times, find profitable avenues for investment and take comfort in the fact that our business community could have it much worse than their colleagues elsewhere.


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Character a key quality in a home With interest rates at record lows, now is a great time to look for that new house. But while you are looking for the perfect abode, don’t eliminate the charm and uniqueness of a house of character — you may be overlooking your dream home. Character is part of that “special something” that makes a Rick Bauer is broker/owner house a home at Re/Max Home and makes your Group. Contact him home stand out at (319) 493-3500 from all the othor rbauer@rickbauer. ers. Let’s face it, net. the handiwork of a craftsman and the pride that went into earlier construction is not often seen in some of the hurriedly constructed homes of later years. From detailed fireplaces and built-in curios with leaded glass inserts to alcoves and ornate hardware to exterior enhancements like gingerbread trim and gables, it truly is the detailing that sets these homes apart. The Cedar Valley is blessed with a wide range of character homes. Highland Park, Prospect Boulevard and college-to-downtown Cedar Falls boast stately Victorian homes featuring open staircases, and perhaps a second floor ballroom or a billiard room. Other neighborhoods showcase homes of the craftsman style with a Frank Lloyd Wright influence. A further search of area listings will reveal saltbox, colonial, Cape Cod, bungalow and Tudor homes. Whatever your personal taste, you are likely to find a great house in a neighborhood near you. Character homes may contain hints of other cultures, with Italianate, Spanish or French detailing. They may harbor clues to earlier times with parlors, maids’s stairways and carriage houses. Others may wear their character outside with open porches, mature landscaping and decorative trim. Granted, homes of character

can be a little intimidating, often with older plumbing and fixtures, dated electrical panels and less insulation. But at the reduced cost compared to newer construction and the unique charm of a vintage home, many would consider nothing else. Sure, there may be some areas that need attention, like replacing windows, adding insulation and perhaps a furnace update, but check first with your local utility company. Often, they offer rebates and incentives, not to mention free consultations to let you know exactly which improvements are needed and what would be most cost-efficient. Home improvement stores and do-it-yourself sites on the Internet offer a wealth of creative and practical ideas on updating and improving homes. These sites may also be helpful in keeping your work authentic to the vintage of your character home. Areas like kitchens and bathrooms often are smaller and dated, but with creativity, inspiration and a bit of wise input, these areas can become features while remaining true to the era. Character home renovation can be rewarding and educational. Before tackling a costly renovation, it may be wise to consult a real estate agent or appraiser to see if the added value would price your home out of a future resale. As you think about your design, remember function and flow to make it not only inviting but easy to live in. For those who own a character home and wish to sell, play up the details that set your home apart. Use paint and lighting to spotlight alcoves and beamed ceilings and to help detailing stand out. Polishing or refinishing woodwork will drawn attention to crown moldings and banisters. Arrange furniture to point out the charm of bay windows and fireplaces. The purchase of a character home not only gives you the satisfaction of a unique and special home, you will also be maintaining a piece of history. But beware, it can become an obsession.


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Many ways to invest in real estate By DAVE KRUSE

In these times of economic uncertainty, I am frequently asked, “What is a safe investment? What can I do to have a reasonable expectation of a safe investment at a reasonable rate of return?” The first part of that question is easily met with the safety of purDave Kruse chasing certifiis an agent with Lockard Realty. cates of deposit Contact him at (319) or treasury bills. 240-5207. The second part is much harder. In exchange for their safety, CDs and t-bills currently have a very low rate of return. My suggestion to balance risk and return is investment in real estate. Real estate investment may not be the correct choice for every investor. There are several types and levels of real estate investing. Many of my local clients have started out by purchasing one or two residential homes as rental properties. They will add more homes to their portfolios if they find they are suited for this business. And make no mistake, it is a business. The most successful landlords consider their investment as such. By treating your rental property as a hobby rather than a business you decrease your chance of being profitable. The next level of real estate investment is the ownership of a commercial property with a gross lease. A commercial gross lease requires the landlord to maintain the property, pay property taxes and pay hazard insurance, just as you would do with a residential rental property. The advantage of commercial over residential leasing is a longer lease with a more stable type of tenant. The lease would be written in specific terms for the tenant and property as opposed a generic form lease. This type of property has a potential return of 10-12 percent. The NNN lease real estate investment is primarily bought on the strength of the tenant and the value of the lease. The terms of

this type of lease are more favorable for the landlord as the tenant assumes the responsibilities for the expenses required to maintain the property. In a true NNN lease the tenant pays the property taxes, the hazard insurance and provides liability insurance that also extends to the owner for any accident or incident that may occur on the property. The tenant also assumes the responsibility for everyday maintenance of the building and the fixtures including lawn care, snow removal and parking lot repair. The landlord’s only expenditures would be for the roof and facade, and depending on the lease terms, the replacement of the HV/AC systems. The expected return on this type of property with a sound lease and good tenant is currently ranging between 7-10 percent. Farmland investment of late has been volatile and is best a cash investment. Although it has a great return in appreciation of value, the cash-on-cash return is usually only 3-4 percent. This type of investment would not support a large loan-to-value mortgage and should be viewed purchase as a long-term investment. The investor needs to decide when to leave the market, taking into account the period of time after which the farmland has appreciated sufficiently combined with the yearly return of cash on the investment. Typically with farmland, the landlord is responsible for property taxes and liability insurance. Please bear in mind the statement, “Past results may not be indicative of future performance,” has much higher validity with the volatile pricing landscape of farmland at this time. The previous information is just a brief overview of the real estate investments that are common to our area. We are fortunate that the Cedar Valley has so far escaped some of the worst effects of the national economy, so now may be the time to consider an investment in real estate. If you desire more information about the purchase or sale of rental dwellings, commercial lease properties, farmland, or personal residences, please feel free to call me.


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Preparation important to sell a house Over the years, I have been a guide on many showings and tours. A few are especially memorable, some for things you should do, some for things you should not. At the beginning of our professional relationship, we will walk through your home. This Angie Thesing time is taken is a sales sssociate for you to tell at Century 21 LSB me more about Real Estate in Cedar it, as well as a Falls. Contact her at chance for me to (319) 231-0326 or assess the posi(319) 266-8080. tives and to take note of things that may need to be done to give your home that sparkle to get the sale. It is a time for me to consult with you on the things you can do to add little touches that make a person feel comfortable and impressed. Let’s start with the showing I had that has stayed on my mind the longest. I opened the front door to a lovely foyer with freshly cleaned floors and slight floral smell with very soft music playing. There was room for us to remove our shoes and coats comfortably, even a small chair on which one of our guests could sit and remove her shoes. We then walked into the living room, there was no evidence of clutter. Shelving was nicely arranged and furniture was not so large as to make the room seem smaller. This made the room easy to navigate and put the focus on important things in the room. The dining room and kitchen were neat as a pin. In the kitchen, the same radio station was on in a very soft tone and a candle was on a plug-in warmer, which made a soft scent. There were no dishes in the sink, the counters were clean and there was no smell of garbage. By the time we started for the second level, we were all impressed. Someone took the time and care to make sure their lovely home was presented in its best light.

Upstairs we again heard soft music coming from every one of the bedrooms. Each of the children’s bedrooms, as well as the parents’, was in tip-top condition. There was no clutter, closets were neatly organized and beds were made. Windows were washed, walls were all painted a neutral tone and floors were clean. The attic was organized and clean as well. This home was a turn-of-thecentury Victorian with an old basement. Basements sometimes make me nervous because they can squelch a deal quickly. This basemen was clean, and on the shelves were storage containers of the same color with matching labels stacked neatly in rows. The organization was easy to notice. As you can guess, there was a radio in the workroom turned softly to that same radio station. Of the six homes we viewed, that home was awarded the sale. I believe that was because of the extra effort the homeowners put into that first impression. First impressions generally stay with a buyer the longest. As your agent I am not there to criticize your housekeeping or handyman skills. My suggestions are just that: gentle suggestions on what you can best do to get the best sale price for your home. Always remember the front entrance. Try to have people come through the entrance that sets off the best first impression. Keep floors and windows clean. All rooms should be clutter-free, dusted and vacuumed. If the rooms seem small, try to remove a piece or two of furniture. Closets should be organized. If possible, remove some items so they don’t appear inadequate in size. Kitchen cupboards and drawers should be wiped out and organized. The sink should be empty of dirty dishes, and countertops should be wiped clean. The house should have a nice pleasant scent, litter boxes cleaned and garbage removed. Do these things before the sign is in the yard, and the sale will be the benefit for your extra work.


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What will your needs be in 10 years? It seems wherever I go, people ask how bad the housing market is. They are always surprised to hear the Cedar Valley it is doing well. We had no big run up in new home pricing and had little to deal with in the way of inflated prices. We have no new housing Craig Fairbanks stock, and everyis the current presi- thing being built dent of Northeast now is either Iowa Association presold or is of Home Builders sold early in the and owner of Build building process Buy or Sell Homes. Contact him at (319) to eager buyers looking for new 553-1457, (319) 404-0412 or craig@ homes. Most buildbuyorsellhomes. builders and real com. estate agents whom I have talked to are busy. This is one of the best times to buy or build in the Cedar Valley. Lumber is at record lows, at nearly half of its high point. Other prices have stabilized, and interest rates are record lows and seem to be going lower. Younger first-time buyers may not be as numerous, but that may be demographic as much as financial. There are not as many young families in our area as there used to be. According to the Senior Housing Council, of the National Association of Home Builders in Washington, D.C., almost 60 percent of heads of households in Black Hawk County are over 45. As a reflection of that, there apparently isn’t a great need for starter housing or large family two-story homes. Instead, there is a great need for housing for people over 50 who are looking for their next lifestyle need in housing. The active adult housing market is the fastest-growing segment of the housing industry nationally, due mostly to the large age group called the baby boomers.

Many boomers are looking down the road at the needs they will have in the next 10 years or so and deciding they want to stay in their home as long as possible and maintain their active lifestyles. Boomers are not sitters, they are doers. Each one wants something different. They do not want to be labeled as any group. At Build Buy or Sell Homes, we started a few years ago to focus on serving this market. It’s called aging in place or the active adult housing market. This housing looks toward future needs with homes that are accessible inside and out for occupants and visitors. It involves techniques called universal design. It allows suitability for anyone to occupy the home and the ability to modify the home for needs of the occupant, whatever their condition. Aging in place does not mean older; it could be apply to someone who, at a young age, has special needs that will last a lifetime. Yet the home needs to serve the rest of the family. A couple of weeks ago, through a National Association of Home Builders course, I became a certified aging in place specialist, and what I learned was a real eye-opener. This is probably the most underserved group of people in the homebuilding and home remodeling industry. I’m not sure what people here do when health needs change almost instantly since no experts are readily available. The best advice I can give is this: Plan ahead and make that move or home adjustment before there are no choices. Some indications of what your needs might be in the future are the heredity in your family. Ask your elders and relatives about when they started to have issues and what they wish they would have done to prepare for those issues. A discussion with a certified builder or remodeler also can be helpful.

For breaking news coverage, photos and video updated all day


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Thank you note leaves lasting impression It seems the lessons we teach our children are often those we forget as adults. Remembering to say thank you should not be one of those misplaced lessons. A promptly sent thank you letter makes the recipient feel valued and appreciated. Sadly it is becoming a lost art in our society. A thank you letter can be Marvin Boldt written in a busiis with Trapp Realty ness or personal and owner of Bold format. There Auction Co. Contact are many situahim at ( 877) tions in day-to292.2121 or (319) day business in 287-8170. which a thank you letter is appropriate. Examples are thanking a valued customer for their patronage, thanking a devoted employee for their years of service or thanking a friend for a customer referral. People prefer to do business with those they know, trust and respect. Writing thank you letters is a powerful way to strengthen relationships that generate word-of-mouth referrals for a small business. There are numerous occasions that warrant a formal thank you letter. For example, a thank you letter to follow up a job interview, a thank you letter to friends for their support following a difficult period or your children sending a thank you letter to grandparents for a special gift. In regards to format, write or type the letter using your business letterhead. Handwritten letters have the best impact — it reinforces the recipient’s importance to you in that you took the time to express your appreciation by handwriting your letter. Address the letter to the individual you wish to thank, using his or her formal name and title on the address line. You can use a more informal greeting if you are on a familiar basis with the person. Otherwise, as a sign of respect, the greeting should reflect the person’s formal name. Begin your letter by explaining in the first few lines who you are and what the note is about. Make

reference to the specific reason you are sending the letter. Use professional language throughout, yet maintain a personal relationship with the recipient. Try to keep the letter as brief as possible while maintaining a tone of appreciation and gratitude. An effective thank you letter needs to be written with sincerity, tact and sensitivity. The thank you letter should not exceed one page. You may then close with your formal name and title on the signature line. If you are well acquainted with the individual, you may sign the note by hand using your full name. As a professional courtesy, you may wish to include your business card. If you don’t include your card, make a phone call to make sure the person received the letter. Finally, address the envelope, using the recipient’s formal name and title. Also, check spelling and grammar before sealing the envelope. While writing a business thank you letter isn’t a revolutionary idea, it does have the potential to dramatically impact your business relationships. The simple act of sending a thank you will speak volumes about the value you associate with the people you encounter. From the people who work for you to the people you work for, everyone likes to be appreciated. Sending a thank you letter is a something that isn’t quickly forgotten. While thank you letters cost next to nothing to send — a few cents for postage and paper — the reward one can reap in successful business relationships and good will is limitless. That’s why I would like to thank everyone for reading this thank you note on what it means to me. For those that I’ve had the pleasure of serving in a business transaction, thank you. Those who might give me chance in the future, known or unknown to me, may I thank you in advance for your consideration of my services. Perfection is my standard, not my goal. Thank you for allowing me the opportunity to participate in sharing my views.


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Opportunity exists among economic uneasiness There is no doubt we are in troubling times. The stock market, bank failures, insurance company implosions, massive ponzi schemes and a deepening recession have left all of us numb, struggling to comprehend all that is going on around us and bracing Ken Lockard ourselves for is chairman of Lock- what may come ard Cos. in Cedar next. Falls. Contact him at What is at the (319) 277-8000. root of our economic problems today? Our nation’s desire to consume has become insatiable; we have indulged our every whim. We spent every penny we earned and when that wasn’t enough we borrowed. Home equity loans, zero-down mortgages, department store credit cards, and on and on. We binged for years, thinking that we had discovered

a “new economy.” Now the party is over, our nation has a splitting headache and feels nauseous, and someone has to clean up the mess. The question is: Have we learned our lesson? Will we do anything different from now on? Continuing to do the same thing but expecting a different outcome is the definition of insanity. Cleaning up this mess will be painful. In 2004, the United States’ public debt stood at a little over $4 trillion. Since that time, our government has borrowed an additional $2.2 trillion, and guaranteed another $8.4 trillion of others’ debt. While these numbers are staggering, and the thought of future generations being saddled with all this debt is sobering, I am optimistic President Obama and Congress are doing the right thing. The alternatives are too ugly to consider. Our prayers are with the president as he leads us during these times. Despite all the bad news and

our own contributions to the problem (myself included), it is critical that we not allow ourselves to be pessimistic. We have been down this road before, and sadly, we will be down it again. The business cycle is just that: a cycle. Sometimes it is up, sometimes it is down. Money is made, money is lost. Bad times follow good times, and good times follow bad times. There is nothing new under the sun. One of the biggest shifts our company has witnessed in the past six months is the drastic change in lending standards as the result of so many bank failures. A year ago many commercial real estate loans were made at razor-thin margins to a bank’s cost of capital, loan-to-values were leaning hard against regulatory limits and guarantees were not required. Talk about a party. Today, however, banks are requiring loan rates to be at a much higher spread to their cost of funds. Fortunately, their cost

of funds has decreased dramatically, helping offset the effects of this change for a while. Banks are also requiring more cash equity up front, driving loan-to-value limits down to 70-75 percent for a stabilized, income-producing property and even lower for speculative projects. And loan guarantees? Don’t even bother to ask for a loan without them. All of these changes have had a tremendous impact on commercial and residential real estate. The interesting thing, however, is these requirements aren’t new. This is how it used to be. We’re being forced to return to fundamentals of sound investing. Cash down payments. Appropriate leverage. Reasonable amortizations. Fair compensation for risk. At Lockard Companies, we are planning our strategy for the future around these two beliefs: ■ The national recession will not hit bottom until the fourth quarter of 2009 or the first quarter of 2010.

■ Locally, the recession will start to be felt in the second and third quarters of 2009, but will not be as deep or as drawn out as we have seen nationally. There are tremendous opportunities for investing in commercial and residential real estate. As banks unload troubled loans and assets, there are great opportunities to make strategic buys. Construction costs have dropped tremendously in the past six months. Contractors are hungry for work. Land prices are down. Combining these facts with the lowest interest rates in 45 years makes for one of the best opportunities in recent history to build a home or expand your business, or make an investment in income-producing real estate. While it is tempting to want to shut out all of the negative news we are bombarded with, keep a keen eye to the future and think long-term. In every phase of the business cycle there is a way to invest successfully.

Hello, My Name Is ... Nametag Guy makes a career of putting himself out there The Associated Press

The grocery store, the post office, a party — no matter where Scott Ginsberg goes, everyone knows what his name is. In fact, he has made sure of it by wearing a nametag every day for nearly

nine years. What began as a college experiment has made an expert on being approachable out of Ginsberg, author of the recently published book “Stick Yourself Out There: Get Them to Come to You.”

“It’s a permission slip into a conversation,” says Ginsberg, who refers to himself as the “Nametag Guy.” “I’ve pretty much seen every possible reaction you could imagine, from people making fun of it, to getting angry and trying to rip it off of my shirt. But

mostly it breaks down barriers.” Being approachable, Ginsberg says, is priceless. He wears the red and white sticker, which reads “Scott,” everywhere he goes and even has a nametag tattooed on his chest. But you don’t necessarily have to wear a nametag to be

able to walk into a room and tell people who you are. Ginsberg has used his experience to launch a career coaching company he calls HELLO, My Name Is Scott, and speaks at seminars about finding opportunities.


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Now is a great time to buy real estate By BOB SMITH

I have seen it all. In 44 years as a licensed real estate broker/ agent in Waterloo/Cedar Falls I have seen that we do not follow exactly with national trends. Our market has done many things and then mostly repeated what has been done before. In the mid- to late-1960s prices were flat. In the ’70s, there was roaring inflation. The ’80s brought depressed prices. They went back up in the ’90s. From 2000 to 2005, prices increased at a slow steady pace because the Cedar Valley grew and diversified its economic base with a healthy combination of whitecollar and blue-collar jobs. Prices went down slightly in 2006 and went up to the peak in ’07. Last year, prices moved only slightly downward, and it looks like ’09 is getting quite soft. But the government is doing everything possible to shorten the downturn. It will not last long. If you believe in buying low, buy now, for the following reasons: 1. Tax incentives and direct government help: Today a $7,500 break is available to first-time home buyers. This will soon be doubled and expanded, so many more will be eligible. 2. Historically low interest rates enhance affordability. Under 5 percent interest for a 30-year fixed-rate loan is a great deal that probably will not last long. 3. Home loans are readily available, in spite of the news from across the country. 4. Local prices have been and are easing. In January, the average sold price appears slightly down from a year earlier at the same time. There may be more down movement in prices in some sectors, but as the government programs to increase home sales take effect, the prices will

go up. 5. More than 500 residences are listed: The number of listings is down from ’07 and down slightly from ’08, but there are many good choices. 6. Inflation always makes home loan payments easier to pay. Higher prices, also known as inflation and maybe hyper-inflation, will follow the printing of trillions of dollars. He’s how to buy now: 1. The average stay in a home is five to seven years, so buy well within your price range. Buy what will meet your needs for five to seven years and plan to move up as your needs and capabilities grow. 2. This old saying is true: “The three most important things about real estate are location, location, location. Choose a location you like, and others will like it too. A real estate agent can guide you about its resale potential. 3. You may not want to buy the biggest house in a neighborhood. Homes in a neighborhood tend to change in price together, so a middle to lower home for the neighborhood is usually best for resale. 4. Finance for the long term. The 30-year fixed-rate home loan is the standard. You can always pay more each month or in lump sum payments as additional principal payments. These will pay the loan down faster, because it all goes to principal, thus reducing the total interest paid and reducing the term of the loan. If you make a double payment each year, it will shorten the term substantially and reduce the total interest paid greatly. The smaller payments required by the 30-year term may also make it easier if the unexpected happens, like a job change, larger family, health problems, etc. This helps to ensure you will be able to make your payments over the long term.

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5. Home ownership is further enhanced and promoted by government programs not available to renters. The Iowa homestead tax exemption reduces the load of the real estate tax. The interest paid on your home loan and the real estate taxes you pay usually can be deducted from your income for income tax purposes, reducing your income taxes. 6. Hire an agent who will

expose you to the whole market, find homes that will meet your needs, and help you enjoy the process. The Waterloo/Cedar Falls Multiple Listing Exchange has almost all of the properties listed that are for sale. Use your agent’s comparable information to guide you in your purchase and in your eventual resale. 7. Contact local lenders and be prequalified for your home loan.

Your real estate agent can assist with the process to make sure it goes smoothly. The lender will be aware of available programs that fit your circumstances. The right lender is important for what will be the largest purchase most people ever make, buying a new or new-to-you home. Bob Smith is an agent with Lockard Realty. Contact him at (319) 269-5712.


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Home Builders: Parade of Homes and much more For the past decade, the parade of homes event has been the most visible image for home builders; however, we are much more than that. The National Association of Home Builders is an organization of builders, subcontractors, suppliers and associates Craig Fairbanks whose goal is to is the current presi- provide a profesdent of Northeast sional cohesive Iowa Association group with one of Home Builders thing in mind: and owner of Build providing the Buy or Sell Homes. Contact him at (319) best product for 553-1457, (319) the customer. 404-0412 or craig@ We provide buildbuyorsellhomes. scholarships for com. deserving students to advance in the profession of home building. We have done many community projects like shelters for the city, ramps for the handicapped and help with building homes with Habitat for Humanity.

When a builder joins the National Association of Home Builders, they are making a decision to become the tops in their field of expertise. When you look at our national Web site, nahb.org, as a member or consumer, you find almost any information you would like about housing. You will find home builder members are the leaders and innovators of “green” building initiatives popular today. Check out nahbgreen. org for more information. Home builders are also given access to superior home building standards far above the minimum code. Our members are not just looking to build to minimums but to constantly get better and to be innovative. Home builders do a great job of educating buyers so the process of custom building is not complicated or scary. We have access to the latest energy savings programs to help members build energy efficient homes. NAHB is a leader in many other research initiatives as well. Education for home builders is some of the most comprehensive

Making a shrewd home purchase requires a good sense of timing By RICK BROWN

The value of single-family homes in the Cedar Valley in 1985 was at the lowest point in a decade. The Rath Packing Co. had just gone through bankruptcy, and John Deere had layoffs in the thousands. We were in an agricultural depression that had farreaching effects. I got laid off from Deere and applied at different companies, but no one was hiring at the time. My family decided our home was here, and this is where we were going to stay. I decided to get into real estate full-time. Part of this business is tracking real estate values, the Consumer Price Index and watching employment numbers and utility connections published in The Courier. As the local economy came back slowly, real estate values rose with the employment numbers. The consumer price index con-

tinued upward, and we continued to hire people and sell those people homes at slightly higher prices year over year. Homes here advanced from 1 percent to 3 percent per year and the Consumer Price Index advanced about the same, in some years a little less. In more than 20 years that I have been in business, values have gone down in only one year, in 2008, and it was a slight decline. Our economy is strong because we are still an agricultural center, although we have diversified greatly. We may have a flat year this year, but we have to remember that even if we decline slightly, prices probably will jump as they did in the late 1980s and continue to follow the CPI. So, when would you like to buy? At the top of the market, or when the market is a little flat and is poised to jump? Rick Brown is with Oakride Realtors. Contact him at (319) 290-6415.

training you can get. When pursuing a designation for specific field of work, such as certified aging in place specialist, many classroom hours are required to achieve this designation along with tough testing to make sure you are qualified to be a leader in that type of work. Other designations include certified graduate builder, graduate master builders, graduate master remodeler, certified green builder and certified new home marketing specialist. Most of these take years to obtain. Just being around those who have been fine tuning and building a better business over a lifetime rubs off on members. When you talk with those who are member home builders and with builders who are not, it doesn’t take very long to realize there is a difference in the level of professionalism and competence. Most home builder members use advanced building methods and tech-savvy ideas to make home building enjoyable for home buyers. Legislation is a key area home builders work on. The stimu-

lus package passed by Congress was very much a national home building issue that backed a plan called “fix housing first,” found at fixhousingfirst.com. Part of the original package that was passed by the Senate was a $15,000 tax credit to buy a home. The basic premise is to shore up home values that were the start of a declining economy nationally. Here in the Cedar Valley, our inventory of new homes is almost nonexistent, and interest in building a new home is high. This is a once-in-a-lifetime opportunity to get a new home at a great price with the lowest interest rates ever. It won’t last forever. Locally, we are constantly defending private property rights and work for good legislation that keeps housing reasonable through our codes and legislative committee. Impact fees, code changes, subdivision and city ordinances are constantly pushing housing costs up. Over the past two years we have worked with the cities on stormwater erosion control, sub-

division ordinances, mechanical code changes and many unfunded mandates from the federal government. The next issue is fire sprinklers in the 2009 residential housing code, and that will not be a cheap add-on. Most fires are in older homes that include old wiring and mechanicals, or through carelessness with candles or cigarettes. In just the last three years, the added costs to a home from code changes, city legislation and ordinances have pushed the price of a home up $32,000 before you even start the project. Thank goodness prices for materials have plummeted and other components are stable for maybe the first time in a decade. When costs are raised, the homeowner is the one who pays, and that takes more people out of the buying equation. This is just a small part of what the Northeast Iowa Association of Home Builders do. Find information on our organization on the Web at CedarValleyHomebuilders.com


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Title companies provide many services By CHARLES AUGUSTINE

The purchase or sale of a home is a significant event, requiring the services of a number of real estate professionals, including the title company. The services of a diligent title company are essential to ensure the transaction is completed in a smooth and efficient manner. The services provided by a title company in connection with the sale or purchase of a home vary from state to state. In Iowa, title companies run a broad spectrum from those providing only title searching services or only closing services to those such as Title Services Corp. that provide the full gamut of title and closing services under a single roof. In a typical real estate transaction in Iowa, the title company gets involved immediately after the buyer and seller have signed the purchase agreement. The first step for the title company is a thorough review of the public records relative to the real estate. The title company must create or update the abstract of title which contains, in abbreviated form, all matters and instruments of record that impact title to the real estate. Once the abstract is complete, it is delivered to the attorney representing the lender or buyer. The attorney prepares a title opinion that should identify the seller as the legal owner of the property and will reveal the existence of any mortgages, judgments, easements, use restrictions or other matters that affect title to the real estate. A proper title opinion will

describe how any such matters must be addressed to ensure the successful transfer of title to the buyer. While title to the real estate is being examined, other agents of the title company will work on final settlement of the transaction. The title company will maintain close contact with the real estate agent, mortgage lender and attorney(s) in order to gather the numerous documents and information necessary for the closing transaction. The title company’s closing agent helps coordinate all the separate tasks of the various real estate professionals into a single fluid real estate closing. The closing agent will use the title opinion as a sort of checklist in facilitating the clear transfer of title. The closing agent also will work with the lender and real estate agents to compile figures, charges and fees into a final comprehensive settlement statement, often referred to simply as the “HUD.” After the settlement statement has been completed and approved, the parties to the transaction gather for the closing. The buyer and seller meet with the title company’s closing agent to review and execute the settlement statement, the mortgage loan documents and the documents related to title transfer and title insurance. The title company also will collect and distribute funds necessary for the transfer of title, the satisfaction of any outstanding mortgage loans or other seller obligations and the payment of

Expert coffee tasters rank brews The Associated Press

A panel of expert coffee tasters ranked a traditional alternative coffe shop brews: preground coffee, bought by the sack. The March issue of Consumer Reports Magazine is running a taste test on 100 percent Colombian caffeinated preground beans. Eight O’Clock Coffee at $6.28 a pound, or just 15 cents per cup, topped the list. Runners-up were Caribou Coffee and Kickapoo

Coffee, at $11.76 a pound and $14.33 a pound, respectively. These three were marked “very good” coffee choices, even when sipped black. Starbucks Corp.’s Colombia Medium came in No. 4, the best of the “good” bunch, due to its pronounced burnt flavors, said Consumer Reports Home and Yard editor Bob Markovich. Milk and sugar may help to mask the taste flaws of coffees rated “good” and below.

any bills for services related to closing. Following closing, the title company will make sure all title and mortgage documents have been properly recorded, that all loan documents have been forwarded to the lender, that all prior mortgages and liens have been satisfied and that all closing-related bills have been paid. The title company also must search title

to the real estate once again postclosing to verify that title has been properly transferred and to make sure all other title matters have been addressed. Thereafter, the title company will secure title insurance as required by the mortgage lender and as may be requested by the purchaser. A good title company strives to make the entire home purchase or sale process as seamless as pos-

sible. Considering that most of the title company’s obligations are performed behind the scenes, the best closing is one that leaves all parties with the impression that the job of the title company was a piece of cake. Charles Augustine is vice president of Title Services Corp., 603 Commercial St., Waterloo. Contact him at (319) 236-9002 or caugustine@titlesc.com.


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Selling your home requires more planning than ever The statistics are true. The Cedar Valley housing market has weathered the national economic thunderstorm with resiliency, but that doesn’t mean every home seller has a free seat under the umbrella. Selling your home in today’s market means doing your Katie Hesse research, setting is managing broker realistic timing of Century 21 LSB financial Real Estate in Cedar and Falls. Contact her goals, analyzing at (319) 266-8080 the competior katie.hesse@ tion, offering an century21.com. attractive product at a competitive price and having the right partners on board to ensure a smooth transaction. Sounds like Business Planning 101, doesn’t it? Don’t forget, you are bringing a product to market. Today’s real estate climate demands a well-executed plan if you are to get the most money and the most favorable terms in a timeline that meets your needs. Gone are the days of plopping a sign in the yard and taking numbers. Consumers are more educated and cautious than ever before, and you as a seller have only one shot to get it right. Every good home-selling plan, like every good business plan, should include the following essential elements:

Goals, objectives

Why are you selling? If your goal is to exchange the equity in your home for a retirement in Tahoe, your core objective may be to sell for top dollar. If your goal is to be out by May Day because you just found your dream home and can’t afford two mortgages, your core objective may be a quick sale. Whatever your motivations, write them down as you begin the process, and don’t forget to review frequently. If you maintain clear objectives, you’re more likely to get the outcome you desire.

Competitive analysis

First things first: Define your target market. Who is your buyer? First-timer? Investor? Executive?

Where do you find them, and what other homes are they looking at? Where do they gather information? How will they pay for your home, and will their financing dictate what type of condition the home must be in? Second, you must thoroughly understand the competition. What other homes will be competing with yours? How are they priced, how long have they been on the market, how do their features compare to your home, how are they being marketed? Third, what have homes comparable to yours been selling for in recent months, and how fast were they absorbed into the market? What is the overall condition of the market, and are buyers quick to make decisions or are they taking their time?

Product development

Step back and look closely at your home through buyer eyes. Buyers are comparison shoppers and will be quick to judge price and condition. You must have the best house on the market in your price range. Period. Regardless of how much you think your house is worth, the market will dictate the price. Beware of overpricing — it will waste valuable time and give buyers a reason not to buy your

home, but rather to buy your neighbor’s home instead. You have control over your home and how it is presented, and you only have one chance to make a good impression. Take time to deep clean, de-clutter and stage appropriately.

Sales management

Exposure is critical. You must develop a marketing plan that communicates the value of your home in a professional, wellbranded campaign. Launch your campaign swiftly and thoroughly where buyers are browsing. What type of information do they need and how can you provide that information without creating barriers? Make sure your home is prepared and accessible when prospective buyers come calling.

Key players

Selling a home fast and efficiently depends on the team you hire to get the job done. Real estate agents, contractors, tax advisors, lenders, inspectors, appraisers and attorneys are specialists in the real estate industry who can expertly guide you through the process. Each brings resources and tools to the transaction, and your choice of key players will determine your success.

Financials

The most important part of any business plan is the bottom line. Don’t forget to anticipate and budget for all possible costs. Surprises at the closing table can dampen any home seller’s euphoria. You will want to identify all costs associated with marketing, taxes, legal fees, repairs, staging, mortgage balances and other liens. A good real estate agent will accurately estimate these for you, and provide you with an amount

that you can expect to walk away with at the closing. Today’s home buyers are savvy shoppers. They are 21st century consumers who expect to capitalize on a challenging economy, understand and use technology to get information and demand move-in condition at “fix-’r-up” prices. Sellers who plan and execute accordingly will be more successful, meet more of their goals and stay high and dry through their real estate transaction.


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Crushing government and consumer debt threatens economy Is it time to begin thinking the unthinkable? Could the policies of our government be destroying the value of our currency? If so, what are the implications? As we look at the economic landscape that has developed over the last few years, it has become clear the U.S. economy faces Matt Driscoll significant strucCFP is a financial tural problems. advisor with MidWeUnfortunately, stOne Investment our leaders in Services in Cedar Wa s h i n g t o n , Falls and can be D.C., continue reached at (319) to forge ahead 277-2500. with inherently flawed policies that will likely prove to be BandAids rather than real fixes for the problems we face. The actions of our government continue to mortgage the future of our nation in order to postpone the pain of dealing with years of excessive credit and consumer spending. Over the past 20 years, we have managed to go from the world’s largest creditor nation to the world’s largest debtor nation. The result is that we have become increasingly dependent on the rest of the world to fund our borrowing needs. At present, roughly

57 percent of U.S. Treasuries are owned by foreigners. We have become a nation of consumers and not producers. We have shifted to a so-called “service-based” economy in which most services cannot be exported, and we have created a major imbalance between what we import and what we export. We have been borrowing money as consumers and a government in order to import cheap consumer goods. This has been possible because countries like China and Japan continue to lend us cheap money so that they can continue to export manufactured goods to us. They, in turn, have continued to help keep our dollar strong so that we will continue to buy their products. In addition to our trade imbalances, our government has racked up a disturbing level of liabilities that could put the U.S. into financial distress and dramatically reduce our standard of living. The U.S. government has about $10.8 trillion dollars of outstanding debt. But that’s only part of the story. The U.S. also has about $40 trillion of benefits promised to future retirees through the Social Security and Medicare programs. That equates to $175,000 per living person in the U.S., $410,000 per full-time worker, or $455,000 per household. This level of debt is unsustainable.

The fact we are dependent on the rest of the world to finance this compounds the problem. With this level of debt already in place, the new administration and Congress are planning massive spending packages and bailouts that only compound the longterm issues. This debt level does not include the massive level of local government debt and consumer debt we have as a nation. A good portion of our mortgage and consumer debt is also held by foreigners. How can we be looking at further tax cuts combined with massive spending programs? There are only two places such funds can come from, and both are problematic. The first source is to print more money. When the government prints more money, it creates inflation and makes all our current dollars and earnings less valuable. The second source is further government borrowing, primarily from foreign sources. Our government via the Federal Reserve can create money out of thin air. Our government has a tremendous incentive to do so. By

creating inflation, it can maintain social programs without raising taxes to pay for them. Inflation is the worst kind of tax; it punishes savings. The government must balance this by convincing the world inflation is lower than it is so interest rates stay low. What are the implications of all these imbalances? They have been building for about 30 years, so how long can they continue without dire consequences for Americans? Like all economic imbalances they cannot be timed on a short-term basis. However, identifying them can help us protect our wealth. If these imbalances continue to build we could be looking at a scenario in which our currency falls dramatically against other world currencies. This is not unprecedented for smaller countries or major ones. England’s pound sterling fell by about 80 percent in the early 1900s as it lost its reserve currency status. It does not mean the end of a country or its currency, but likely means a painful period of rebuilding and a substantial destruction of wealth.

If this were to happen to the U.S. dollar it would likely mean substantial inflation. Foreign dollar holdings would rush back to the country driving interest rates sharply higher, and there would be substantial reductions in buying power for people with all of their wealth in U.S. dollar-based assets. This destruction of our currency would generally be good for exports, but we have few products to export given that we have destroyed much of our manufacturing base. There are ways to protect yourself and your hard-earned wealth from such an event. There are many ways to diversify out of the dollar; however the limited space of this article precludes me from such detail. I hope I will be proven wrong with this forecast as it would mean a painful period ahead for our country. We are a strong and resilient nation and will ultimately come through whatever lies ahead, but we should not be so naive to believe these imbalances can continue indefinitely without some shocks to the system.


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Businesses can be socially responsible, even in bad economic times Bad economic news abounds lately, and this means bad emotional news for a lot of our friends and neighbors. Foreclosures, layoffs, decimated savings, retirements delayed or abandoned and shrinking budgets create pain for just about everyone, including busiDonna Wood nesses and manis the David W. agers. What’s a Wilson Chair in Busisocially responness Ethics at the sible business University of Northern Iowa. Contact her at person to do? You’ve heard of the UNI Business Executive Development “fight or flight,” Center at execdev@ the adrenauni.edu or (319) l i n e - c h a rge d 273-5851. options we take when completely stressed? There’s one more that may be even more common: “Freeze!” We humans have a tendency to hunker down and hide in times of trouble. This was perhaps a useful strategy for avoiding becoming some lion’s lunch, but these days the “freeze” response can expose your business to a slow and painful death. In a financial downturn, the first inclination of many is to slash expenses and trim jobs. You may think of this as fighting back against recession or fleeing from

the worst effects of economic difficulty, but in reality, you may be freezing your business’s ability to thrive. Layoffs demoralize all your employees. Slashing the budget for travel, office supplies, utilities, advertising, R&D, etc., can save money, but it can also leave your company cut off from the resources needed to boost revenues. Businesses whose managers are committed to social responsibility are especially troubled by the choices they face in hard times. They find themselves caught between wanting to meet their responsibilities to stakeholders and needing to act so that the business survives. Here’s some good news: Exercising corporate social responsibility isn’t always hard, even in hard times. Sometimes, all that’s needed is a bit of mental rearranging. Consider, then, these suggestions. ■ Focus on efficiency and effectiveness, not budget cuts. Avoiding waste is the first place to look when budgets need to be trimmed. Most of us can do more with less if we’re appropriately motivated and think creatively. You can present efficiency goals as a positive way to reach effectiveness goals. For example: “We all want a healthy business, so let’s work together to find less

costly ways of doing things.” ■ Go green, or greener. Greening your business is a serious efficiency generator, helps preserve the environment and can also produce revenues in ways you might not expect. Insulating and recycling are now commonplace ways to save energy and money. After you’ve done all you can do with those, get creative. Can you safely reuse materials you are throwing away? Can you sell materials you’re now recycling for free? Can you hold web meetings instead of face-to-face? Can you change your operating hours to reduce energy costs? Can you alter your product design or processes to reduce waste? Can you market to customers who appreciate green businesses? ■ Spend a penny, earn a dollar. Ben Franklin gave us the notion that “a penny saved is a penny earned,” but consider that often in business “a penny spent is a dollar earned.” Cutting back sales travel or R&D will save short-run money but will likely cost future revenues from lost customers and thin product/service pipelines.

Installing solar panels or a geothermal heat source is expensive, but there are significant longrun payoffs. Training employees now can prevent accidents and mess-ups later. In fact, investing in training now may give a business a leading edge in front of its competitors. Keeping quality alive in your product/service line can prevent lawsuits and regulatory interventions downstream. Remember that Ben also urged us not to be “penny-wise and pound-foolish.” ■ Ask for help and share the pain. For most businesses, the largest expense is personnel. Layoffs may seem to be inevitable, and this could be a good time to lose the employees who aren’t pulling their weight. Then, consider asking your employees to help themselves, their colleagues, and the business by voluntarily reducing hours. If you can explain why a 10 percent labor force reduction is necessary, you may find your employees are willing to work 36 hours instead of 40 for a while. And this would be no time for management bonuses or salary

boosts; managers’ cries for help are hollow if they are dumping all the pain onto workers. ■ Reinvigorate your business model. Recently a top executive at one of America’s bailedout banks was asked if his bank would now be able to loosen its death-grip on lending. Certainly not, he huffed, the bank wouldn’t be changing its business model just because it took billions of tax dollars. Pardon? Yes, banks do a lot more than lend mortgage money, but really — if your business is banking, shouldn’t you be lending? If your business is selling groceries, shouldn’t you be stocking what people want to buy? If your business is repairing autos, shouldn’t you be making sure you have satisfied customers? The bottom line is that efficiencies and revenues are often out there to be found, even when times are tough. If managers can face their own fears, enlist their employees and focus creatively on the basics, a business has a better chance of making it through a downturn.


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Retirement village sprouts at Wartburg One of the growing trends in off-campus housing doesn’t involve students, but possibly their grandparents. During the past 20 to 25 years, more than 50 retirement communities have been built in close proximity to campuses to provide easy access to the continuing education, cultural Saul Shapiro is assistant vice pres- and recreational ident for institutional o p p o r t u n i advancement and ties offered by director of communicolleges. cation and marketing Wartburg Colat Wartburg College lege is partnerin Waverly. ing with the Bartels Lutheran Retirement Community in Waverly to develop Eisenach Village, just northwest of the campus. The 31-acre development with 40 single-story condominium homes in the first phase is on 20th Street Northwest on property adjacent to Bartels, but formerly owned by Wartburg. It is anticipated that ground will be broken this spring and homes will be ready for occupancy this fall. Twelve charter memberships — providing the option to purchase homes first and at the best price — already have been sold. Bartels has 55 years of experience in long-term care and more than a quarter-century developing independent living options. The project is being built by Ohio-based Epcon Communities, which has developed 140 retirement communities in 31 states since 1986. Eisenach Village is named after Waverly’s sister city in Germany, which is the home of Wartburg Castle — the college’s namesake — where Martin Luther took refuge during the Reformation. “Eisenach Village is yet another partnership between Wartburg College and Waverly that exemplifies our excellent ‘town-gown’ relationship,” said Edith Waldstein, Wartburg’s vice president for enrollment management.

“The residents of Eisenach Village will not only enjoy independent living in a beautiful home, but also the ready access to the vibrant educational life of Wartburg. The college, on the other hand, will benefit from the opportunity to develop intergenerational curricular and cocurricular initiatives — to the educational enrichment of our students.” Eisenach Village will have a clubhouse, workout facilities and walking paths, and it is close to the Wartburg-Waverly Sports & Wellness Center with its yearround fitness equipment and classes. For an expanded stroll, Wartburg’s new Max Cross Country Course is nearby. Eisenach Village residents could take advantage of Wartburg’s “Keep on Learning” education and cultural courses — a series of eight sessions with four weeky two-hour classes. Scott Leisinger, Wartburg’s vice president for institutional advancement, believes Eisenach Village could be a magnet for Wartburg alumni. “Wartburg is excited to partner in helping to make Eisenach Village a unique living environment,” Leisinger said. “We’ve

talked about opportunities for residents to access The W, attend cultural and athletic events, participate in ‘Keep On Learning’ programs, and integrate into the college community. “Several alumni have shown an interest in the project, and while Eisenach Village isn’t exclusive to Wartburg alumni, I think that group represents a good market for Eisenach Village. Our alumni understand the unique quality of life that Waverly and the college can offer.” Wartburg, which has the oldest accredited social work program in Iowa, stands to reap some educational benefits from the partnership. “Wartburg’s faculty, students and staff will have the opportunity to develop intergenerational programming at Eisenach Village and on campus involving the residents,” Waldstein said. “The concept of offering independent living through Eisenach Village, tied to the continuum of care at Bartels, is exciting and makes lots of sense,” said the project’s sales manager Mike Cooley. The Eisenach Village homes will have six different floor plans and range in size from

1,100 to 1,800 square feet with a “pinwheel design.” Four homes will be attached at the garages, but with a stand-alone exterior look. The homes are designed to be energy efficient, and residents will benefit from the convenience of a maintenance-free community.

“Eisenach Village is an exciting opportunity not just for its future residents, but also for Bartels, Wartburg, and the greater Waverly area,” said Debra K. Schroeder, Bartels president and chief executive officer. “The active, dynamic lifestyle will reverberate throughout the community.”


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Multiple factors determine success in selling home What is success? It has a different meaning to each of us. We’ve all been successful in some way. To some it may be measured by a career achievement or a grade on a test. To some it may be the first steps after months of Kara Bartels is a broker associate rehabilitation with Weichert, Real- from a life-threattors-Inspired Real Es- ening accident, tate, 118 E. 18th St., or just conquerCedar Falls. Contact ing another day her at (319) 277after several 1077 or (319) 939treatments of 1611 by telephone or bartelsk@hotmail. chemotherapy. Success is a com via e-mail. personal thing. It must be on your own terms. It may look good to the world, but most importantly, it must feel good to you.

Success in real estate can seem burdensome and challenging, but can be as simple as to paying attention to the current market and dressing your home to create a lasting impression. The decision to place your home on the market can involve a number of stresses and strains. Whether you’ve lived in your home two years or 20, it is a place you’ve called home. It is the place where your dreams come to life. But then, it is time to move on. Time to reflect on old memories and prepare to build new ones. Time to leave the past behind for a new future. It is no wonder why buying or selling a home is often emotional and overwhelming. When you’re getting ready to put your property on the market, there are a number of factors to consider. The most important is to price your home to sell for the

most money and in the shortest amount of time, and with the least amount of hassle. Every seller wants as much money as possible when selling a home. The natural inclination is to price a home high, thinking we can come down in the future. But a listing price that is too high typically nets the seller less money than if the home was priced correctly. Because people looking for homes in your price range will reject your home in favor of other homes in a reasonable price range. When a home first hits the market, it generates the most interest and showings. The current market determines what your home should sell for, and if it is priced too high you’ve eliminated the initial interest. Finally, in order to attract attention back to your home, you’ve reduced your price more than you ever thought you would, and

you’re now netting much less than if you had priced it correctly in the beginning. It is not the seller or the real estate agent that determines the listing price, it is the market. Being successful at selling your home means staying in tune with the market conditions. Another factor is dressing your property for sale. Buyers look for homes, not houses. First impressions set the tone when buyers visit. Most buyers select homes based on emotions. Once a decision is made to buy, they justify their purchase with facts and features. It’s most important to make your home appeal to all senses. Your home is not the only one the buyer is looking at. You are competing with other homes on the market. We get comfortable in our own homes, and it is easy to overlook items that need attention.

Take a look at your home through a buyer’s eyes and make sure you create a lasting impression. How does your home look when you approach it? Is it appealing? Is the interior clutter free? Would the buyer feel at home? There is so much to consider when dressing your home for a sale. Making that lasting impression will be your key to success. Of course other factors help in your success of selling real estate. Those factors may be location, how your home is marketed and the amenities your home has to offer. It only takes one buyer, and the more you embrace these factors the better your chances to succeed in the sale of your home. The real estate market is always changing, and although the economy has taken a turn for the worse, there is never a bad time to sell.

Small businesses turning to independent contractors By JOYCE M. ROSENBERG AP Business Writer

NEW YORK — As the recession forces small businesses across the country to cut expenses, some are making a dramatic shift — they’re laying off employees and using independent contractors instead. Back in 2006, Ron Gold had only full-time employees in his advertising agency, but business began to slip and he began using freelancers. Last year, he closed the agency and started a marketing services firm, using only independent contractors — some of whom used to be former staffers. “It was not that we wanted to hurt anybody, but we needed to grow,” said Gold, owner of Marketing Works in East Setauket, N.Y. He noted that with employees, he had to keep paying them even when business was falling off and there wasn’t as much work to do. Bonnie Harris also began using independent contractors when

her marketing business slowed in the summer of 2007. Until that point, she had four full-time employees as well as part-timers. “My business was really having a hard time and the biggest problem was payroll taxes and employees, carrying salary burdens,” said Harris, owner of Wax Marketing in St. Paul, Minn. “I couldn’t pay myself because I was paying these people.” So she began replacing her employees with independent contractors. The result: “2008 was our best year.” There are many benefits to hiring contractors rather than employees, and not just during a recession. Businesses don’t have to pay for benefits and don’t owe the government payroll taxes for contractors. When there’s less work to be done, the contractor isn’t paid, unlike the employee who draws a regular salary. “It makes my business more profitable, without a doubt,” said Charles Barrett, owner of FZ Media Design, a graphic arts and Web design company in Yardley,

Pa. Besides saving on benefits, he noted that he doesn’t need as much office space, and that also helps keep expenses down. Barrett made the decision to use only contractors when he started his business five years ago, and he credits that strategy for helping his company to flourish even in a sluggish economy. Moreover, he said, “by not carrying all the overhead, I’ll be willing to pay a higher hourly rate” to draw talented workers. There are other pluses: Owners can hire different contractors for different projects, depending on workers’ strengths and talents. It also means less time spent managing workers. Harris had an unexpected feeling of relief without any employees. “What I didn’t have was the burden of feeling responsible for that person’s career, helping them grow and learn,” she said. Harris also found she was more free to make her own hours when she no longer had staffers to supervise. But Harris also making the switch from full-time employees

to contractors had a learning curve — supervising an independent contractor is very different from overseeing the work of someone on your payroll. “It was hard for me to figure out how to do it at first,” she said. “You tell them, ‘here’s this task,’ and you have to be specific, and you’re not there in the office with them.” The difficulty that Harris encountered comes in part from the fact that independent contractors must by law be treated differently from employees. An owner doesn’t have what the IRS calls the right of control over contractors — for example, the place where they work, the hours they put in on a project, the tools they use and how much supervision there is. If a worker is too much under the control of an owner, the IRS could find that this is in fact an employer-employee relationship, and the business then must pay Social Security and Medicare taxes retroactively and will also have to pay penalties.

Owners can find information on the IRS Web site at http:// www.irs.gov/businesses/small/ article/0,,id99921,00.html to help them determine if the way they’re treating workers makes them employees or contractors. The IRS is willing to help owners make that determination. Owners can file IRS Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, and the agency will make the determination for them. The form itself, which asks a series of questions, may help some owners figure out the classification for themselves. One way to avoid any problems is to spell out in writing at the start of a relationship how it will be conducted. And, as it proceeds, to be sure that both the owner and the contractor adhere to that description. Owners might also want to consult a human resources adviser or an attorney who specializes in employment law to be sure they don’t run afoul of the tax laws.


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Real estate development Now is great time to buy, sell home requires team of advisers You have been cruising past that piece of bare dirt for years now. While making your New Year’s resolutions, you decided this year you were going to achieve that big goal. That patch of earth is going to be the site for your business move. The site is larger than you’ll need — Fred Miehe Jr. other businessis with NAI Iowa Realty Commercial. es could join Contact him at (319) you. Welcome to the world 233-9999 or (319) 240-2266. of real estate development. Let’s identify the roadblocks to your success. Is the property zoned? Does your planned use conform to the city’s planning and zoning land use plan? Is the area served by utilities? Fiber optics and high speed connectivity is important. You had better include involving the local utility companies in your study. What is the accessibility for ingress and egress? There might be state funding available. Does the site qualifies for tax incentives — for instance, is it a TIF district? Better include the area economic development group to your team. If the city has an economic development director — most cities do — better include them, too. If your proposed site is going to be split into parcels for multiple users? That implies platting, and for platting you’ll need a civil engineer. Depending on the complexity and size of the project, you may want to seek out an engineering firm that offers design services, too. Here is another key player for your team. What does the site look like? Is there going to be site preparation required? You know, creating a pad ready to build on. What is the make-up of the soil? Is the ground buildable? It may look good from your car window, but that waterway that fills when it rains may need some questioning. Will it pro-

vide a nice view for aesthetics and is that a good thing? Or is it something I need to be concerned with? It might be a protected wetland. While you are evaluating the risks, what are the costs going to be? How much will the costs be for all these improvements, site preparation, infrastructure, engineering, platting, design, holding costs and acquisition? Did I mention you’ll need a bank on your team? How does that compare to other buildable sites available or that have recently sold? You are going to need to research that piece of information to determine the true value of each parcel if your plan is to realize a gain on the excess sites. Developing farmland into buildable sites is risky business. Your goal may be achievable this year. Be sure to have a quarterback — a real estate professional — as one of your first calls. Make the first call to a professional broker, someone who is qualified to help you. It’s what professional commercial and industrial real estate firms like NAI Iowa Realty Commercial do.

Many people are asking themselves these days: “Is now the time to buy or sell a home in the Cedar Valley?” My answer to that, you bet it is! Now more than ever it is critical that home buyers and sellers be educated about Jennie our market. We Plummer have all heard is with Oakridge Realtors in Cedar Falls. that interest rates Contact her at (319) are phenomenal 240-2777 or jplum- right now, which mer@OakridgeReal- they are, but tors.net. there are many other financing perks available that many people don’t know about. Did you know that the Housing and Economic Recovery Act of 2008 authorizes a $7,500 tax credit for qualified first-time home buyers purchasing homes on or after April 9, 2008 and before July 1, 2009? And, now, there is a new stimulus package allowing first-time homebuyers, as of Jan. 1, to receive

$8,000. This stimulus money does nto require repayment, as long as you are in the home for at least three years. Talk to your real estate agent, lender or tax advisor for more information. The tax credit is a wonderful program that can help people in a variety of ways. Money may be used toward a down payment or for home-improvement projects. The money is repaid to the government, without interest, over 15 years, or when you sell the home. It acts as a zero interest loan. The credit would be paid back at $500 per year, starting two years after the credit is claimed. For example, if a homeowner claims the credit on a 2008 tax return, the first payment of $500 would not be due until their 2010 tax return is filed. If you sell your home before the credit is paid off, the balance would be due from the profit of the sale. If there was not enough profit from the sale, the balance will be forgiven. There is also a wonderful down

payment assistance program through the Waterloo Housing Partnership for first-time home buyers. The program will provide up to $5,000 in the form of a fiveyear forgivable loan. You can also qualify for up to $29,000 toward a new-construction home. There are a few guidelines for the program including mandatory home buyer education classes. The local market has handled the general housing crisis well. Educated lenders and real estate agents have helped many buyers make smart decisions when purchasing a home. The Cedar Valley does not have nearly the foreclosures seen in other areas of the country. In fact, agents would love to see more houses come on the market. In Cedar Falls, the average month’s supply of homes available is only three months, with several price brackets at less than a twomonth supply. Waterloo is only slightly higher, with an average five-month supply. Now is a great time to buy, sell or build in the Cedar Valley.

For breaking news coverage, photos and video updated all day


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It can be a good time to make big move into new home You are put on Earth for a limited amount of time. During that period you will write, if only figuratively, your story. Your story would have started with a “home.” You would have been only a few hours old when someone muttered, “We get to take the baby ‘home’ Diane Litton tomorrow.” From is with Oakridge that moment on Realtors. Contact her home was the at (319) 504-6686. center of your universe. Webster defines home as the place where one lives; a residence, a physical structure. You know it is far more than that. A home is an environment offering security and happiness.

Purchasing a home will probably be the largest investment you will make during your story. It will give you pride in ownership, pride in accomplishment and pride in providing a safe and secure environment for those you love and who love you. In this economy, perhaps it is frightening to consider writing that new chapter in your book, a chapter about you buying your first home or making a move to a home that meets your current needs. Contrary to the national news, the housing market in the Cedar Valley is still strong. While there are areas in the nation where foreclosures are running rampant, our market is not reflective of the surge of foreclosures. That is good on a few fronts. Due to the history of Iowans using sound planning

and living within their means, most here are able to take advantage of the rest of the country’s dire straits. The federal government has been forced to attempt to stabilize our economy. First, interest rates are at a historical low. Secondly, there is a program, first time home buyers tax credit, that will allow first time home buyers to receive up to an $8,000 tax credit on their 2008 income tax. That is cash in the pocket that can be used toward a down payment. For further details speak with a tax consultant. When interest rates drop many homeowners’ first thought is to refinance. Not a bad plan if that person is already in the home of their dreams. If you are not in your dream home, the lower rate could possibly move you to

Marketing even more important during tough economic periods In my almost 20 years as a business market research consultant, I am still amazed at how small and midsize businesses go about marketing themselves. Fortune 500 companies are adept at analyzing how they Ron Padavich market, where they spend is director of marketStrategic Marketing their Services, a program ing dollars and of business and the results they community services expect. They in the College of continually monBusiness Administraitor the return tion at the University of Northern Iowa. on their marinvestContact him at (319) keting 273-6942 or ronald. ment and make padavich@uni.edu adjustments a c c o r d i n g l y. During tough times they may cut back, but only in areas that are questionable. They never cut back on a sure thing, and one sure thing is that if you quit telling people about yourself, what you have

to offer and how you can benefit them, they will soon forget about you. Result — you’ll find yourself in a hole you’ll have to dig out of when times improve. Most medium- and small-sized businesses are reluctant to spend money to market and advertise, even in good times, for one reason: They are not convinced the money they spend will result in enough new business to justify the expense. There is just too much uncertainty. Many of those who have tried marketing or advertising have had poor results because they make three common mistakes. First, they get comfort from the herd mentality. They look at how and where their competitors are advertising and then do as they are doing. Never mind that their competitors’ advertising may not be working. Second, they use the shotgun approach. They throw out a bunch of advertising and hope for the best. Third, they rely on an advertising salesperson to tell them how and where

to advertise. As a result, these businesses fail to get the results they had hoped for. So here is something you probably don’t want to hear: The best time to market and advertise is during tough times. Why? Because everyone else is hunkering down and cutting back. The easiest way to beat your competition is to attack when they are retreating. Customers are still buying even if they are buying less, and they will have more confidence in businesses that appear to be on solid footing. This is not to say that you should advertise in a helter-skelter fashion. Be cautious. Be smart. Spend less but get maximum benefit from every dollar. You can only do that if you target your customers, know what they want and know where they get their information when considering a purchase. The only way to do this is to conduct market research either on your own, or with the help of a market research firm. Do that, and you are on the road to success.

a larger home without increasing your payment much. Closing costs are usually the same when you refinance as when you purchase a new home. An example below will serve as a guide to enable you to do some calculating at the various interest rates to see how much more you can buy at the lower interest rates. Estimate your monthly princi-

pal and interest payment by multiplying your rate per thousand by your mortgage amount. As an example, $66,000 at 6 percent for 10 years is $11.11 times 66, or $733.26 principal and interest per month. Now is the time to research information for the next chapter in your book. Let me help you with that research.


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New LED display saves Cedar Valley serious green In November Signs & Designs installed a new Daktronics LED message center at Young Arena, and in four years the display will pay for itself in energy savings. The previous message center, installed in the early 1990s, used 2,816 Mason Fromm i n c a n d e s c e n t is a sales consultant with Signs & Designs light bulbs that flashed on and in Cedar Falls. Contact him at (319) off creating mes277-8829; (800) sages and dis326-8929; or maplaying the temson@thesignpeople. perature. Those net. little light bulbs would frequently burn out, leaving the sign hard to read and requiring expensive service calls. The electricity to run the old message center cost Waterloo Leisure Services about $50 a day, which means around $18,000 was burned up by those little light bulbs each year. LED (light emitting diode) technology is showing up in all kinds of familiar products like flashlights, holiday lighting, stoplights and vehicle brake lights. Daktronics is the world’s leading supplier of full-color LED video systems and provided a perfect replacement for Young Arena’s aging message center. The new full color display has over 43,000 LEDs, but uses only an average of $3.37 in electricity every day. Not only is the new LED display

much “greener,” it also allows Young Arena to display full color logos and even video clips — far superior to the one-color text messages and randomly burnedout lights. The investment in LED technology was substantial for Waterloo Leisure Services, but the longterm savings will be well worth it. In just two years, the operating cost of the old display would have been equal to the purchase price plus operating costs of the new LED display. That means in just 4 years, the new display will have paid for itself and will save Leisure Services over $1,400 a month. Another energy-saving LED project on a smaller scale can be found downtown at Screaming Eagle American Bar & Grill. Above each awning there are two strips of color, one red and one blue. At first glance, you may think they are neon, but they are actually LEDs encased in a translucent plastic tube. This LED border tube has a couple important advantages over neon. Neon lights are glass tubes filled with a gas that glows when a few thousand volts are applied. The fragile glass and the high voltage are two safety concerns that make low-voltage plastic LED tubes more appealing. Additional energy is required to make neon glow. When coupled with the extra maintenance costs, neon can’t match the benefits of LEDs.

If you compare the cost to install LED border tube with the cost to install the same straight lineal footage of neon, however, neon will be less expensive. A great analogy is the cost of a regular 60-watt light bulb and a comparable compact fluorescent lamp. The 60-watt bulb costs a fraction of the compact fluorescent, but the fluorescent puts out roughly the same amount of light, uses less energy and lasts much longer. Each is true for LED border tube compared to neon. Every industry is creating more efficient products and educating customers on ways to achieve the same results using less energy and producing less waste. This year’s Strictly Business Expo is focused on promoting those products in the Cedar Valley. From energy-saving copiers to signing up for electronic statements from your bank, you’ll find a wide array of planet-saving ideas from local businesses with a global conscience. The Strictly Business committee has assembled a panel of “green experts” for an interactive discussion beginning at 3 p.m. April 7 at the Park Place Event Center. Representatives from Cedar Falls Utilities, Hawkeye Community College, StruXture Architects and MidAmerican Energy will lead the discussion and offer unique insights on the newest green technologies and strategies.

Model good spending habits for kids The Associated Press

Even children as young as two or three observe how their parents spend, said Meridee Maynard, Northwestern Mutual financial literacy expert. Parents who want to teach their toddlers the value of careful spending should try to use cash, rather than credit cards, when out shopping with kids. Paying with cash shows the littlest children that buying means payout, so that they never get the idea that credit is free.

“We all develop our habits, particularly with money, at young ages,” Maynard said. “We have to go back to basics.” Once kids are about six, Maynard recommends starting them on a weekly allowance and talking about saving up for specific medium-term goals, such as a special toy to buy in about a year. Parents should start to instill that money earned via allowance can be used in four ways: it can be spent, saved, invested (explain it as long-term saving) or donated. After a few years, start doling

out allowances every two weeks rather than once a week to get children to learn to plan their spending and stretch their dollars, she said. Also encourage 12-year-olds to get money on their own by doing neighborhood chores or baby-sitting. “Money doesn’t just happen,” she said. “You have to earn it.” Explanations about stocks and bonds can come when kids are teenagers, Maynard said. Turn investment ideas into math problems and involve them in researching investment opportunities.

Now is the time to make an investment in a “green” technology for your business. Ask questions and request some real-world examples from your “green” vendors, then ask how you can track the savings. Once you have your results, share them with your associates and encourage them to discover their own energy-saving technologies.

Imagine your business found a way to save $1,400 every month by investing in a greener technology like the Young Arena example above. What would that extra money mean for your business? Find your green solution at the Strictly Business Expo April 7. More information is available at www.GreaterCedarValleyChamber.com


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Getting back on track after a storm If your property receives storm damage, take the following steps to begin the claim process: ■ Report your insurance claim as soon as possible no matter what the level of damage. Insurance companies Scott Parsons need to get a is an agent for good idea of Allstate Insurance. the amount and Contact him at (319) kind of damage 233-3380. so they can adequately respond to customer needs. ■ Flood damage is not covered by most homeowner policies. You

can protect your home, business and belongings with flood insurance from the National Flood Insurance Program. For cars, flood damage is covered under the comprehensive section of most standard automobile insurance policies ■ If possible, have your auto insurance, flood insurance, homeowner insurance and/or renter’s insurance policy number available when you report your claim. If you’re an Allstate customer, report a claim by: ■ Telephone, (800) 547-8676. ■ Internet, at www.allstate.com and clicking on the “catastrophe” icon. ■ Contacting your local agent.

It is important to take pictures as you clean up and make a list of all damaged contents. Also, keep a sample of items such as carpet and upholstery for your claim adjuster. If your home is uninhabitable, your insurance may provide coverage for you to stay in a hotel, purchase food, clothing and other necessities. This type of coverage, called additional living expenses, is covered by most homeowner insurance. Be wary of out-of-town contractors or vendors with whom you’re unfamiliar. Talk to your insurance company first. Check references and work only with reputable contractors.

Energy efficiency would give savings a needed jolt There is no denying many Iowans are feeling the pinch of the current recession. For those living on reduced or fixed incomes, nothing hurts more than a rising bill you have to pay, like the electricity and gas bill. One of Carrie La Seur the best ways to is president of Plains protect Iowans from higher utilJustice, Vermillion, ity bills and free S.D. Contact her at (605) 659-0298. up those funds to invest in our economy is to embrace aggressive energy-efficiency programming. A 2008 study by the Iowa Utility Association identified more than 1,500 megawatts of technically feasible energy efficiency available in Iowa by 2018 at a cost of only 3 cents per kilowatt hour. That is not counting municipal and cooperative utilities’ efficiency potential. By comparison, producing electricity at the proposed Alliant coal plant at Marshalltown will cost 8 to 9 cents per kilowatt hour. Our expert witness predicts a 22 percent rate hike as a result. A common objection to energyefficiency proposals is: “You can’t force people to make their home more energy-efficient.” It would be more accurate to say you can’t force people to spend money they

don’t have. People who are struggling to pay the electric bill are unlikely to invest hundreds in new insulation that would pay for itself within a year or two. Smart utility policy would offer instant rebates or zero-interest financing to pay for installation. Consumers would benefit as peak demand dropped, lowering prices, and money was diverted from utility bills into the local economy. Down the road, efficiency programming would make it unnecessary to build expensive new power plants. The Cedar Valley has already shown leadership on energy efficiency. Waverly Light & Power began offering innovative incentives in 1991 and has attracted hundreds of commercial and industrial participants who have saved thousands of kilowatt hours while lowering bills. The key has been the proper initiatives. The utility knew everyone, including the utility, would save if the programs were aggressive. Over the 18-year period, more than 70 percent of residential customers have enrolled in one rebate program or another. Coupled with efforts like Trees Forever, the utility has reduced the potential peak demand by 3 megawatts, 10 percent of the entire system peak. The net savings to the utility has exceeded $1.5 million.

Energy efficiency is not just a way to save money but a way to make money. In 2004, an estimated $300 billion was invested in energy efficiency technologies and infrastructure in the U.S., supporting 1.63 million jobs. These numbers are growing. The better the Cedar Valley can train its work force to lead the transition to greater energy efficiency, the better it will retain and attract quality employers and employees. Many peopledon’t know what to do or where to start using energy efficiency to make their homes more comfortable and lower their bills. This is a problem looking for an entrepreneurial solution. Businesses that step forward to offer efficiency solutions — showing up with a truckload of high-efficiency light bulbs, small appliances, weatherproofing products, etc., to tackle a homeowner’s full set of needs — could do well even in today’s dollar-conscious economy. The tremendous economic benefits of strong efficiency programming include decreased healthcare costs from lower air pollutant emissions and benefits associated with lower greenhouse gas emissions. Remember, the cheapest kilowatt hour — in terms of our wallets, our health, and our planet — is one we don’t have to produce.


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Many options when it comes to heating, cooling your home When constructing a new home, there are many options to consider when choosing the heating system that is right for you and your family. Heating and cooling are two of the most important concepts of home Gary Satterlee ownership and contribute to is heating manager with Dalton Plumbing one of the most Heating and Coolimportant cusing, 5536 Nordic tomer goals Drive, Contact him — comfort. Cedar Falls, at (319) The Depart266-3513 or www. ment of Energy DaltonPHC.com. says 40-60 percent of all energy consumed in the average home goes toward heating and cooling. Heating systems keep your home warm and comfortable. In a cold climate, the function of your heating system should be a high priority. Most heating systems are classified as forced-air systems, because they send air through ductwork for distribution. This ductwork can contain products that filter and clean the air. Even the most efficient furnaces will not work as well if other factors such as proper insulation, efficient windows, etc. are not considered. Consult with a professional concerning alternative sources of heating your home such as: ■ Hybrid heat — This system is designed to deliver maximum comfort and economy with a dual fuel system.

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■ Geothermal heat — Geothermal energy not only costs less but also helps preserve natural resources and lessens dependency on fossil fuels. A geothermal or “ground-source” heat pump is an electrically-powered device that uses the natural heat storage ability of the earth and/or the earth’s groundwater to heat and cool your home. ■ Radiant floor heating — This source of heat proves to be very efficient as the entire floor is used to heat a room instead of a small vent. This works using hydrophonics, which is basically hot water running through flexible plastic tubing under tile and/ or wood floors. This method is gaining popularity, especially in cold weather climates. Comfort is the No. 1 reason homeowners are choosing this heating method. There are three methods being used in new construction today – radiant air, electric radiant floors and the hydrophonic method — the latter being the most popular with residential construction because of efficiencies in both installation and energy costs.

■ Fireplaces — Fireplaces serve as an extra source of heat. Placement of fireplaces in key areas of your home can be a tremendous benefit. Fireplaces are tested with the same standards as central furnace systems. In new construction, this enables the homeowner to match the HVAC requirements, providing additional source of heat for the rooms they spend the most time in. There are two types — wood burning and gas. Both provide additional sources of heat for your home and the ambiance that comes with a fire. However, gas fireplaces prove to be more efficient with the immediacy of heat with the flip of a switch. Dalton’s Plumbing Heating and Cooling is constructing a fireplace showroom to provide customers with hands-on convenience in selecting the fireplace just right for their home. Homeowners today have many options when it comes to heating their homes. Dalton’s heating technicians are trained to assist in the recommendation for your home’s most efficient and proper heating system.

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Need space at your business? Outsource IT to save money Growing businesses should consider outsourcing business processes before investing in new construction or relocating to ease space constraints. Outsourcing information technology and other processes is an economical solution that will enable you Wendy Knapp to cut operationis marketing conal costs across sultant with ACES, the board. 1007 Technology If you have a Pkwy., Cedar Falls. Contact her at (319) small IT depart266-9800, ext 111, ment or employ(319) 553-084 or ees spread out wknapp@acesiowa. over multiple com. locations, a remote IT help desk may be an economical alternative to developing your own department. In addition to eliminating space requirements, investment in hardware and infrastructure, and employment costs, outsourcing these services allows your company to focus time, tal-

Get your money’s worth Advertising in Cedar Valley Business Monthly is an efficient way to spend your advertising dollars. If you want to place a display ad, call an account executive at 291-1497 from 8 a.m. to 5 p.m. Monday through Friday. Our account executives and creative department will be happy to help you establish a campaign, step-by-step, that will sell. Before you set next year’s budget, give us a call.

ent and resources on your primary business. Outsourcing help desk service to troubleshoot software and hardware issues can be done over the phone or through remote control access with the caller’s workstation through a secure connection. Outsourcing your network management through a managed services contract with a qualified engineering company will give you access to an entire team of highly trained and experienced engineers without the expense of housing and supporting them. A managed services contract is the best way to ensure security, system productivity and cost predictability of your network. Physical space can also be saved by using virtualization technology. Through virtualization, one server can do the work of many, reducing space requirements and energy costs. Perhaps your existing space is adequate. But is the electrical system and the cooling system adequately supporting your technology investments, or are they a

liability? Power surges and outages can devastate hard drives, and servers can fail from overheating. Backing up and storing your data in an off-site, highly controlled data center is the best way to ensure your data is protected and available. Data centers and data farms are designed with strict specifications and built to withstand natural and man-made disasters. The systems in these environmentally controlled centers are tested and redundant, making this level of security and reliability accessible to businesses of all sizes. Outsourcing some of your IT management and processes does not require contracting with a company in another country. Managed services and remote help desk solution providers are available locally. Look for one with good reputation who will build a partnership with you and your team. Building a strong relationship with an IT provider is as important as the relationship you have with your banker or accountant.

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Developing a disaster recovery plan By RON COENEN

In light of last spring and summer’s disasters, it has become increasingly important for businesses of all sizes to create a disaster recovery plan. Unfortunately, it usually takes disasters like last year’s tornadoes and flooding to bring these types of plans to the forefront. Every business can experience a serious incident that will prevent it from continuing normal operations. These incidents can be as large as a tornado or flood or as seemingly incidental as a sprinkler malfunction. Businesses today need to be prepared to recover fully and quickly from any and all issues. A disaster recovery plan is simply a step-by-step outline to reduce both the risk and impact should the worst occur. Most businesses already have protections in place for some of what they consider important. We protect our buildings, our equipment and our vehicles with insurance. What we often forget to protect is our data and our documents. According to disasterrecoveryplanning.org, “Next to personnel, data is your most irreplaceable asset. Networks,

Execs’ retirement plans pushed back The Associated Press

A recent survey of 1,426 chief financial officers of companies with 20 or more employees found 27 percent plan to work more than they did five years ago. Another quarter said the economy is so uncertain they can’t predict when they will retire. However, 43 percent said the recession isn’t affecting their retirement timeline. Most who said they are pushing back their retirement goals cited the state of the economy and the tumbling stock market, especially its effects on their savings. Another 11 percent cited Social Security concerns, while 10 percent said health care costs are prolonging their working years.

application hosting platforms, and end user computing environments can be replaced readily. Without your data, your business cannot recover.” If all your data and documents were suddenly destroyed, would your business be able to continue its normal operations? If not, then you need a disaster recovery plan.

Getting started

Creating a disaster recovery plan may seem daunting, but it does not need to be. Begin by gathering useful and important documents and information. Some of these include: ■ An organization chart showing names and positions. ■ Copies of floor plans. ■ IT system specifications. ■ Examples of critical documents (invoices, purchase orders, work orders, applications, etc.) ■ Relevant industry regulations and guidelines. While this is not an exhaustive list, it will get you started. Next, establish a retention schedule: a list denoting the number of years each document needs to be kept before it can be destroyed. Some documents’ retention schedule is established by legislation, and

some can be decided on within your organization. Once this list is established, a methodology of protecting these documents needs to be established. Normally, a document management system is the most cost-effective and secure way to accomplish this. Choosing a document management system is sometimes overwhelming. With thousands of products on the market that do roughly the same thing yet all claim to be the best, there are some key points to consider. ■ Have a thorough analysis done of your documents and business processes. This analysis may be done at a charge to your business or free as a service. ■ A summary of results should accompany any recommendation. ■ Investigate the type and level of integration with any line of business application before purchasing a system. ■ Investigate the ability of expanding the application as your company grows. ■ Inquire into the history and stability of the company that created the system. ■ A number of companies with expertise in other areas of document management have ventured

into this space as a secondary add on. Purchase products from companies that are within their expertise level and seek out document management companies that specialize in this arena. ■ Although cost is a factor, do not make it the primary factor in your decision. If cost is the primary factor, your organization is not ready to establish a serious disaster recovery plan. Once this system is in place you are one step closer to having a disaster recovery plan. Many other aspects of the plan are required to keep your business in continuous operation, and those will become an integral part of the entire plan. The key is to have that plan in place. A frightening statistic presented

on disasterrecoveryplanning. org states, “In a national survey of 5000 small businesses sponsored by Office Depot, four out of 10 businesses do not have a disaster preparedness plan. Nearly a third (27 percent) claim to have no plans to create one and a full 25 percent of business owners explain they would rather deal with a disaster when it occurs rather than get ahead of a potential problem.” In light of the disasters we experienced in our own back yard in the past year, we cannot afford to be among this statistic. Ron Coenen is a solution consultant with IKON Office Solutions Inc., 260 33rd Ave. S.W., Cedar Rapids. Contact him at (319) 493-0721 or rcoenen@ikon.com


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History provides perspective on economic turmoil By BRAD LEE

Webster’s defines perspective as: “the power to understand things in their true relationship to each other. “ With investment markets down, the value of your portfolio plummeting and a breathless reporter on CNBC is telling you this is the worst financial crisis to ever hit the U.S., it’s easy to lose perspective. In 25 years of investment experience, I’ve learned a couple of things. One, history didn’t start when we were born and, two, it’s easy to lose perspective when history is happening to us. My grandmother was born in 1919 at the tail end of the great flu pandemic. It is estimated that 30 million people worldwide lost their lives to the flu including a staggering 700,000 in the U.S. After surviving this epidemic, what did her generation have to look forward to? Just the Great Depression. Ten thousand banks failed in the first year. At the peak of the Depression, unemployment hit 25 percent. This was in a time when the workforce was made up mostly of men. In some Northeast industrial cities, the unemployment rate hit 75 percent. The stock market shed 80 percent of its value. We’ve had 15 banks fail in the last 12 months and an unemployment rate of 6

percent, and we think the world is coming to an end. Perspective. What came next for my grandmother’s generation? World War II. The early years of the war went badly and the U.S. stock market suffered a frightful decline. Of the men drafted, many were gone for up to four years. Commodities were rationed. Casualties were enormous. It is estimated that 72 million people died worldwide, including 420,000 Americans. A handful of countries lost more than 10 percent of their populations. Near the end of the war my grandfather was drafted. He reported to boot camp leaving behind a wife and four children. He was 27. It boggles my mind to think the military had already drafted all of the combat ready men between the ages of 18 and 26. He was one of the lucky ones. He came home. Perspective. The 1950s and ‘60s were filled with raising families, establishing careers and building the American infrastructure we use today. Korea, Vietnam, assassinations, riots and civil unrest followed. Investors took a beating during the super bear of 1973-74 as the Dow Jones lost nearly 45 percent of its value, yet they persevered. Tom Brokaw called them the “Greatest Generation,” and that is true. Perspective. What about us? Do we measure up to the “Greatest Generation?”

The current economic times are challenging, recessions always are. It’s especially frightening if you are one of the unfortunate ones to lose your job. Despite a loss of confidence, the U.S. is a hardy nation, and we will recover from this economic downturn. I don’t pretend to know when this recession will end. I don’t know how long it will take the stock market to recover, but I do know this: If you are an investor, this market decline is a gift. Use it to your advantage. There is an old saying in the investment business, “get rich slow.” What does that mean? It means if you invest some money each month, over a period of years, you will accumulate a sizeable nest egg. Now is the time to get rich slowly. Don’t wait for the market to recover. Don’t wait for the economy to stabilize. If you wait for that to happen, the window of opportunity will be long closed. If you are contributing to a 401(k), you should be gleefully adding as much as you can each month. What if you’re already retired and this market has scared the daylights out of you? Understandable, but don’t sell at the bottom. Remember this feeling in your stomach, and when the market eventually rebounds (and it will), re-adjust your portfolio at that time. Better yet, get some

Book highlights career of woman who created Barbie The Associated Oress

Surprisingly to may people, it was a woman who dreamt up the Barbie doll, the voluptuous international icon that turns 50 this year. Ruth Handler’s rise and fall as co-founder of toy maker Mattel Inc. is documented in the new biography “Barbie & Ruth,” written by Robin Gerber and published by HarperCollins. “Behind Barbie is this very important and inspiring woman who isn’t a household name the way Walt Disney is,” Gerber said. “She created one of the world’s most successful toy companies, and the most successful toy. She knew that little girls fantasized

about being women, and at the time there was no other doll like this for them to play with.” The book details Handler’s early years as the tenth child of Polish-Jewish immigrants; how she and her husband turned

her small toy business into a multi-million dollar company; the scandal that forced her out of Mattel; and her experience as a breast cancer survivor. Handler died in 2002 at age 85.

professional advice. The Cedar Valley is fortunate to have an abundance of top-flight investment professionals to assist you. The reason most investors are not successful is because they invest at the wrong time and they sell at the wrong time. Break this habit. Turn off the screaming investment guru on TV and step

away from the Internet. Chart an investment plan and stick to it through thick and thin. Be thankful for the opportunity to invest at low prices. Investing, like life, is a marathon, not a sprint. Contact Brad Lee, director of Brad Lee Financial Services in Cedar Falls, at (319) 266-0096.


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The truth about home mortgage market much brighter in Iowa It is hard to turn on the television, listen to the radio or read a newspaper without hearing about the mortgage industry. There’s no doubt a significant number of Americans are experiencing difficulty. The good news is that the real estate picMike Schick ture for Iowa is is with Sands Mort- markedly better gage Co. in Waterloo. than the national Contact him at (319) situation. 433-3777. (319) How did this 239-7782 or www. mikeschick.com and happen? The recent www.sandsmortgage.com real estate boom was fueled by a period of record home appreciation in some areas and historically low interest rates. Banks, in order to compete, loosened guidelines and began offering more funding to more borrowers through riskier, non-conforming or “exotic” mortgages. These lending conditions persisted for years, supported by high demand, historical real estate data, home prices and massive trading volume/profits on mortgage-backed securities and other financial instruments on Wall Street. Then, in 2006, a slowdown in real estate led to a deterioration of home values, an increase in inventories and ultimately to today’s tightening of credit guidelines, leaving many unable to sell or refinance out of their existing positions. Many Americans who had tapped into their equity were suddenly tapped-out and overextended as home values fell. Foreclosures followed in record numbers and a re-valuation of mortgage bonds and other financial instruments created the credit/liquidity domino effect we’re now experiencing. The most recent mortgage delinquency numbers available are for the second quarter of 2008. In Iowa, those numbers reflect that just over 2 percent of all mortgage loans were in foreclosure. However, even this statistic overlooks the fact Iowa has debtor friendly foreclosure laws that allow delinquent loans to remain in foreclosure status longer than other states. As a result, the same

loans are counted multiple times — quarter after quarter. A better indicator is how many loans entered foreclosure during the most recent quarter. In Iowa, total foreclosure starts were 0.64 percent of residences. Iowa ranked 32nd in the nation, an improvement from 30th at the end of the first quarter of 2008. States like California, Florida, Nevada and Arizona account for roughly 25 percent of all outstanding mortgage loans in the U.S. but 46 percent of all foreclosure starts. These four states also experienced an average annual home price appreciation in excess of 10 to 15 percent or more per year from 2002–07, while Iowa was experiencing around 5 percent. The major corrections are taking place in areas that had the highest rate of appreciation. According to a survey done by the Office of Federal Enterprise Oversight, as of June 30, Iowa is ranked 17th in housing appreciation (1.83 percent) in the U.S. This modest appreciation during the last year is great news when 22 other states have depreciating housing values. What does this mean for you? Contrary to what you may have read or heard lately, there are tens of millions of dollars available for home purchase, new home construction and refinancing in the Cedar Valley. Lenders are taking residential mortgage applications, processing, approving and closing them every day. Guidelines for approvals have become more restrictive due to the increases in mortgage delinquencies and foreclosures, but loans are still available. With the federal governments recent injection of some estimated $600 billion directly into the mortgage markets (Fannie Mae and Freddie Mac) we have just seen the largest one-day drop in interest rates and it appears low rates will be around for a while. Rates are reaching record lows, but will not be for everyone. Your credit score has the biggest impact on your mortgage interest rate. With a 720-plus credit score, you can expect to get the best rates available; with a 680-719, you will be about a quarter-percent to one-half percent higher than the best rate available. The

lower the credit scores, the higher the interest rates, typically. Other things affect your rate. Investment property carries a higher interest rate than a home mortgage or refinancing. The loan-to-value ration — the property’s worth in relation to your loan balance — affects the rate as well. Residential investment property lending has changes as well; not only will you pay a higher interest rate, but a year ago you could have 10 investment property mortgages financed, and now that numbers is down to four regardless of your credit score. A year ago when a borrower obtained loans over 80 percent loan-to-value they had a few options. Most of those loans are non-existent today. The reason for these types of loans was to avoid private mortgage insurance, and the reason they are almost non-existent today is lenders in the second lien position are at more risk because of mortgage defaults or foreclosure, they get paid last. That leaves us with mortgage insurance on loans with a loan-to-value over 80 percent. With the increased mortgage defaults, mortgage insurance companies have also increased their premium costs along with stricter underwriting guidelines which are also credit scoring based as well. If you’re planning on selling your home, be prepared for an smaller pool of qualified buyers. While some experts predict a settling of this credit crisis over the coming year, tightened credit guidelines and diminishing mortgage products could knock out 15-30 percent of potential qualified buyers. Now is not the time to sit and wait for the best possible price. Have a serious talk with your real estate agent. Having experienced buying/selling transactions in your area, he or she can help you price your home accordingly. He or she can also help ensure that your buyers are pre-approved and stay pre-approved throughout the entire transaction. Buyers should get pre-approved by your mortgage professional. While there are a lot of great deals out there, getting credit is becoming tougher, and it’s taking longer and longer to complete a transaction. What you qualify for

today could change tomorrow in a volatile market. For those looking to refinance, keep this in mind. There is no time to delay! Communicate with your lender. Don’t do anything that could negatively affect your credit, and make sure you get all your documentation in on time. Finally, there’s an important concept to embrace: All markets,

while cyclical in nature, are selfcorrecting. For the last six or seven years, real estate was booming and riding high. The correction we’re experiencing now — while it seems harsh — is, in a sense, “natural” and directly related to the extremely loose guidelines and perhaps overzealous lending and leveraging during the boom cycle.


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Now is a great opportunity for first-time buyers By TODD YOUNG

First-time home buyers have a great opportunity to purchase their first home this year. The Housing and Economic Recovery Act of 2008 authorizes a $7,500 tax credit for qualified first-time homebuyers purchasing homes on or after April 9, 2008 and before July 1, 2009.

An eligible “first-time” buyer has not owned a principle residence for three years prior to the purchase of the new home. Veterans looking to purchase their first home who are eligible for $5,000 in VA matching funds can use this in conjunction. As a veteran, I am happy to be able to help fellow vets receive all the benefits they have earned.

VA and Rural Development loan programs are the last to offer 100 percent loans, meaning the buyer does not need a down payment if he or she qualifies. With interest rates being at historic lows and the stimulus package being offered by the government, I am excited to be able to help first-time buyers this year. This tax credit acts as an inter-

‘Fix it’ button is tech support at your fingertips By DARREN HOOK

Given the state of the economy, investing in information technology is crucial. Financially smart investments can ensure companies remain competitive and successful. To make the most of your new IT investments, though, it’s critical that you educate and empower your employees to fully leverage the tools and applications they use every day. Providing easy access to tech support is the first step in maximizing the latest innovations in programs and software. When employees have issues with their technology, they want their technical difficulties amended quickly and effectively. Fortunately, Microsoft recently deployed the ‘fix it’ button, which allows users to let the computer automatically take all the recommended steps to solve an issue. The “fix it” button has been added to hundreds of online help documents, which typically showcase steps on how to tackle a problem. For example, the ‘fix it’ button can be used to resolve malware issues in Internet Explorer. You just click the “fix it” button, and the PC will automatically tackle the issue without requiring you to walk step-by-step through the solution process. Since December, more than 95 percent of users’ who tried ‘fix it” had their issues resolved. For employees interested in learning more about technology, Microsoft offers customer service and support (CSS), a resource available 24/7 to provide advice and answer questions about how to deploy and maximize technology. The CSS Web site (www.

support.microsoft.com) offers step-by-step guidance. For additional support, people can post questions to one of many technical community sites (www.microsoft.com/communities) hosted by Microsoft. These online communities foster discussion through blogs, chat rooms, news groups and other forums where members of the technical community provide insight into a variety of technologies. Along with knowing where to find support resources online, it is also important that employees leverage technology available at their fingertips. Many new PCs come equipped with the latest Microsoft operating system (OS) that can cure some common frustrations and make the transition to a new machine seamless. Windows Vista softens the learning curve by adhering to the established routines of employees and mimicking their everyday PC usage. If you use Excel every day, Vista will keep track of your patterns, and when the OS loads it will begin preloading Excel. As your patterns change, the OS will recognize these adjustments and modify which applications preload at startup. While business owners want to

ensure a seamless transition to recently-acquired technology, it is equally important to protect the information on these devices and applications. The latest OS also comes with enhanced security features against possible virus threats. Because most viruses are accidentally downloaded by employees, Vista offers user account controls, which will prompt the user and ask “This application is trying to install. Do you want me to allow? Yes or no.” This gives you full control over what is installing on your machine. Today, businesses simply cannot afford a decrease in employee productivity. Empower your employees to understand and use the abundant technology resources at their disposal, and continue to make safe computing a priority for your business. In so doing, you will make the most of your IT investments and your employees will have even more time and resources to focus on business priorities. Darren Hook, global escalation manager, works with the Microsoft Customer Service and Support team, providing customer service and support solutions throughout Iowa, including Cedar Valley.

est-free loan to be paid back to the IRS every year from tax refunds for 15 years. Of course, the buyer can pay this back as quickly as they like, but this is the guideline. The credit is also retroactive, so if you purchased your first home after April 9, 2007, until today, your tax preparer can get you this credit. Stacy Folkers , a mortgage loan

specialist with Countrywide Home Loans, and I will be having periodic one-hour seminars to provide first-time home buyers more information on this opportunity. Todd Young is with Prudential One Realty, 3138 Kimball Ave., Waterloo. Contact him at (319) 240-8689 or todd@prudentialone.com.


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Education can prevent financial disasters By ROXANNE FULLER

What happened to the lessons we learned from the Great Depression? Years ago, I remember my grandmother would save, patch and recycle everything. When I asked her why she responded, “Because during the Depression we had nothing, and I don’t want to go through that again”. The generations who suffered through those trying times learned how to be frugal and manage what little resources they had. I feel we have forgotten those important skills and haven’t passed on those lessons to our children. Financial literacy, or the lack of it, affects all of us. A financially literate community has fewer bankruptcies, fewer account charge-offs for businesses and a stronger economy. Credit education is the key to making sure our society knows how to handle financial challenges. Based on the Jumpstart Youth Financial Literacy Survey, credit education has long been and continues to be identified as an important community need. Iowa high school seniors topped the national average for financial literacy, based on the results of a 2004 Jumpstart youth financial literacy survey. However, they scored only 53.7 percent of the questions correctly, a failing grade on the typical scale used by schools. So while Iowa youths scored slightly higher than the national average of 52.3 percent, their overall financial proficiency remains cause for alarm. The survey also found that school districts in 38 states have personal finance guidelines. Iowa will soon require school districts to provide financial literacy education for K-12 students. In September of 2003, Consumer Credit Counseling Service of Northeastern Iowa started a pilot program providing financial literacy to Expo High School students in Waterloo. This program, called MoneyMap, is given each year at Waterloo’s East High School, West High School, Cedar Falls High School and WaverlyShell Rock High School junior and senior students. As a result of the program’s success in the

Cedar Valley, CCCS now provides the financial literacy course in 17 Northeast Iowa high schools. The MoneyMap program includes our credit education courses, Credit When Credit is Due, CheckWise and Renting Today and cover topics such as budgeting and managing a checking account to establishing good credit. Credit When Credit is Due and CheckWise are nationally recognized. Renting Today was written by Karen Atwood, CEO of Consumer Credit Counseling Service of Northeastern Iowa. Atwood is also a local landlord with more than 30 years experience. Renting Today depicts landlord/tenant issues. Overall, CCCS taught more than 4,600 students with MoneyMap courses throughout Northeast Iowa during the last school year. Iowa schools must teach financial literacy to all high school students beginning in 2010. Atwood has been serving on the panel setting the model core curriculum for financial literacy. Also, to help college students, CCCS entered into a partnership with the Wesley Foundation to open a credit counseling office just off of the campus of the University of Northern Iowa in Cedar Falls. According to a Nel-

lie Mae study, 23 percent of college freshmen had credit cards before entering school. Another 43 percent secured credit cards in their first year of college. CCCS is also approved to help people facing bankruptcy. CCCS was the first agency in the state to be approved by the U.S. Department of Justice to provide bankruptcy counseling and education. The bankruptcy act signed into law in 2005 requires bankrupt debtors to get the necessary counseling and education as part of the bankruptcy process. That counseling had never been required before. CCCS is also approved by the Department of Housing and Urban Development to provide housing counseling for issues related to delinquency, foreclosure, prepurchase and renting. Since 1984, we have been helping people get out of debt using a variety of tools, tips and resources. Our debt management plans are the most popular. Through a debt management plan, you pay CCCS a certain amount and the agency pays that to creditors each month. Many companies reduce the interest charged and waive over-limit and late charges. CCCS can also set up bill-paying accounts and representative pay-

eeships. We offer a variety of programs to suit individual needs. A strong Cedar Valley relies on financially strong individuals and families. No matter what your financial condition, visit with a CCCS certified credit counselor. Contact us at 234-0661 for counseling. Counseling sessions are free and confidential.

Roxanne Fuller is community relations director for the Consumer Credit Counseling Service of Northeastern Iowa in Waterloo. Contact her at (319) 234-0661 or waterloocr@cccsia.org. The CCCS of Northeastern Iowa is headquartered in Waterloo and has branches in Cedar Falls, Dubuque, Mason City, Forest City, Marshalltown, Grinnell, Ames, Dubuque and Decorah.


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Little direct help for small companies in stimulus plan NEW YORK (AP) — The government’s economic stimulus plan doesn’t include many provisions that directly benefit small businesses, but economists say those companies are more likely to find a cure for their financial ills closer to home — with their own customers. The plan does extend two provisions of 2008’s economic stimulus bill that allow small businesses to take a bigger upfront deduction for the cost of new equipment. But companies whose sales are hurting may be reluctant to make big expenditures, putting those tax breaks out of reach. “There’s not a lot in the stimulus plan that will put cash in the hands of people who will deliver it to the front door in the form of sales,” said William Dunkelberg, chief economist with the National Federation of Independent Business, a Washington-based small business advocacy group. Raymond Keating, chief economist with the Small Business & Entrepreneurship Council, is also dubious about how much help the plan will give the nation’s small companies. “I think we clearly need a different type of package,” said Keating, whose Washington-based group also advocates for small business. “We need incentives in the private sector for people to take risks and expand business.

Unfortunately, there’s very little of that in this package.” The package continues the expanded Section 179 deduction, which was nearly doubled in 2008 to $250,000 from $125,000. The deduction allows small businesses to deduct upfront the entire cost of equipment such as computers, furniture, vehicles and manufacturing machinery. The bill also extends bonus depreciation, which gives businesses of all sizes a more substantial first-year deduction than traditional depreciation rules. But companies across the country have been cutting back their capital spending, unwilling to make big commitments or unable to get financing. That means the tax deductions aren’t likely to help as many companies as the government had hoped. Economists say the natural return of consumer and business spending as the economic cycle continues is more likely to help small companies. “The best thing to happen to small business is if customers come in,” Dunkelberg said. Dunkelberg said a big problem in the economy now is that “the guy whose job is not at risk has been scared into not spending.” When those consumers and businesses release pent-up demand, the recession’s grip on the country may ease. Keating expects businesses to

be the catalyst. “Consumers are followers; as long as business is investing, expanding and creating jobs, consumers are quite happy and are going to keep spending,” he said. But economists say the recovery is likely to be uneven, with some industries or companies within industries ahead of the pack while others lag. “I think it’s going to be a very much case-by-case situation,” Keating said. “Companies that come up with the innovations that get consumers excited, or the cost savings that get consumers in the door are going to benefit.” In the meantime, small business advocates plan to keep lobbying for legislation they believe will provide a bigger boost for the economy. Bill Rys, tax counsel for the National Federation of Independent Business, said his organization wants to see the government extend the Section 179 and bonus depreciation provisions into 2010, and for that decision to be made this year. “We’re not going to see a recovery in the immediate term,” Rys said. “The incentive to spend is not going to be there until the end of the year, and you may want to wait till next year before you spend.” The NFIB also would like to see the Section 179 deduction expanded to include equipment

Americans say they plan to keep their wallets closed The Associated Press

A monthly reading of Americans’ spending intentions, the Discover U.S. Spending Monitor, edged up to 77.8 in January from 76.6 in December, which had been its lowest point ever. But that was still down 8.2 points from last June, before the massive market meltdown in the fall. More Americans continue to say they plan on spending less in the next month — 29 percent — compared with 17 percent who say they will spend more. A year ago, the position was switched: more consumers planned to shoptill-they-dropped than curtail spending.

Two-thirds of those surveyed said they think the economy is going downhill, slightly better than the 70 percent who were pessimistic the previous month, but 52 percent said their financ-

es are deteriorating. Only 49 percent said they have money left over after paying bills. The Discover Financial Services survey randomly polled 15,000 U.S. adults by phone in January.

that currently doesn’t qualify for the tax benefit, such as heating and ventilation systems and also building construction. That change, Rys said, would benefit the construction industry as well as small businesses. The organization also wants to see the tax deduction for a new company’s start-up costs to be doubled to $10,000 from its

current $5,000. Rys noted that many people being laid off will be starting their own companies and could use a bigger break on their taxes. The NFIB has also been campaigning for the government to suspend payroll taxes — employees’ and employers’ contributions to the Social Security system — for six months.


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Poor economy taking its toll on Americans The Associated Press

Layoffs, foreclosures and seemingly endless headlines on the tanking economy are taking their toll on Americans’ psyches and habits, one recent survey says. The poll, by insurer Country Financial, found 75 percent of adults surveyed said the issue of money and the economy were very or somewhat stressful topics for their families. Respondents ages 18-29, the youngest group, said they were the most anxious, with 52 percent saying these conversations were very stressful. The economic climate initiated more arguments with spouses or children for 33 percent of those surveyed. The youngest group of survey takers and the poorest, those who reported yearly income under $20,000, were most likely to say the bad economy caused more familial fighting. Americans are also reporting changing habits, with 68.5 percent of adults saying they are now limiting family outings, such as going to movies and dining out. Another 53 percent said the economic environment has permanently changed the way their families spend and save. The survey polled 1,169 adult Americans by phone. It was conducted on Nov. 20 and polled only those who had children at home. The margin of error was 3 percentage points.

Get your money’s worth Advertising in the Cedar Valley Business Monthly is an efficient way to spend your advertising dollars. If you want to place a display ad, call an account executive at 291-1497 from 8 a.m. to 5 p.m. Monday through Friday. Our account executives will help you establish a campaign.

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Small businesses can run into tax prep pitfalls

NEW YORK (AP) — Income tax filing season can be a trying time for small business owners, and in a recession, even more so. One of the biggest pitfalls owners are likely to encounter is a perennial one: poor recordkeeping that not only makes it hard for them to complete their returns, but also to know where they stand financially. Another common problem is keeping up with changes in the tax laws, especially for state and local governments that are now looking for ways to increase revenue. Ask tax professionals what their clients struggle with, and haphazard books and ledgers is often the first answer. Many business owners don’t know how much money they have on hand, how much they owe and what their customers or clients owe them. “You really need to control your books and understand what you’re making,” said Jeffrey Chazen, a certified public accountant with Eisner LLC in New York. Some business owner use their checkbooks and credit card bills as their records. But it’s a problem when “they can’t locate all their check registers or all of their bank statements,” said Gregg Wind, a CPA with Wind Bremer Hockenberg LLP in Los Angeles. Others are even more disorganized, with boxes or piles of invoices, receipts and canceled

checks that need to be sorted — CPAs ruefully refer to these owners as “shoebox clients.” These owners are in danger of missing out on important deductions and can end up overpaying the government. Or, if the government questions a deduction, you could lose it if you don’t have documentation. The answer is to use a computer application to keep your books, one that interfaces with tax preparation software. But many owners don’t use such programs because they don’t have the time to input the information. Well, they can either spend the time throughout the year keeping their books, or spend even more time trying to figure things out before April 15. The solution for many owners in this plight really should be getting help, whether it’s a bookkeeper to take care of ledgers and a tax professional to handle returns, or both. It may be too late for 2008, but it’s still early in the new year, and a good time to get organized. Badly kept records are a particular problem for owners with home offices or who use cell phones and/or vehicles for both personal and business reasons. They need to keep good personal as well as business records. The IRS allows owners with home businesses to deduct a por-

tion of expenses including mortgage interest, repairs, utilities and insurance, and unless taxpayers have invoices and receipts, they can’t compute the deduction accurately. Similarly, you can deduct a portion of what you pay out on cars, cell phones and other items with dual purposes, but you need to keep track of when a car, for example, is driven on personal errands or to meetings with clients. At this point, after the year has ended, it’s hard to reconstruct that information. Another problem for many owners is keeping up with all the changes in the tax laws — and not just at the federal level. Many states have laws that differ from the Internal Revenue Code, and owners need to be aware of them. Leon Dutkiewicz, a CPA with Margolis & Co. in Bala Cynwyd, Pa., noted that some states treat depreciation of assets differently from the federal government. That means two separate calculations for each item that’s being depreciated. Another complication is for companies that do business in different states — for example, a small retail chain. Chances are they have different tax laws, which again means separate calculations. “Trying to keep current on federal tax law changes and state tax law changes were you do business and every locality, it

If you’re handing out pink slips, cover yourself The Associated Press

If you’re the one doing the firing this layoff season, don’t let your emotions get you in a legal bind. Personal remarks or ambiguous statements made while handing out pink slips could be the basis for a wrongful termination lawsuit or discrimination complaint, according to The Alternative Board International Inc., a peer advisory board for small and midsized businesses. The same goes if comments seem insensitive. “This economy is turning some good people into desperate people,” said the board’s president, Jason Zickerman. “With terminations and layoffs, employers need

to understand that if isn’t done the right way, people will see opportunity and dollar signs. In their minds, they have no other choice.” Don’t underestimate the intensity of the situation for both manager and employee. These meetings can be tempestuous, and if not prepared for and executed properly, are a potential path to litigation. The Alternative Board offers these tips to avoid creating legal loopholes for ex-employees: ■ Avoid vague messages like, “If it were up to me, you’d still be working here,” or “It looks as though we most likely won’t be able to keep you on.” ■ Comments or documents

with inappropriate exaggerations and emotionally-laden rhetoric will sabotage your defense in a wrongful-termination case. ■ If charged with discrimination, your business will have to prove that the termination was business-related. Managers who neglect to document policy violations and inadequate performance make it challenging to support the company’s defense. ■ Prepare what you’ll say, how you’ll say it, and even how long the meeting will take. It sometimes helps to rehearse or practice speaking points. ■ Respond kindly but firmly to emotional outbursts, threats and accusations.

becomes extremely difficult,” Dutkiewicz said. “It’s forever in flux at all levels.” The easiest way to keep up with those changes is to have a good tax professional whose job it is to follow the tax laws. There are some federal changes for 2008 that owners need to be aware of. Wind noted, for example, that if partnerships choose

to get extensions of the April 15 filing deadline, they have to file their returns by Sept. 15, not Oct. 15 as in the past. Many more changes are likely for the 2009 tax year, since the government is expected to have an economic stimulus plan in place, and many states are also likely to enact changes in their own tax codes.


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Consider these 10 steps to improve your finances, ease your mind By JOHN ENGLIN

Money isn’t everyone’s No. 1 worry, but if it’s yours, consider the following steps to improve your financial life. 1. Write down your goals. Have you ever written down the big things you want in life? All great dreams don’t cost money, but many do. Money buys freedom — to travel, to retire early, to start a business, to change careers. Putting goals in writing gives them a formality and a starting point for the planning you must do. 2. Evaluate your risk tolerance. One of the most beneficial things financial planners do is help you articulate your financial goals and establish your tolerance for risk. With the market turbulence that marked 2008, many individuals would benefit from an analysis of how much risk they want — or need — to take given what they want to achieve with their money. 3. Track your spending. If you haven’t purchased financial accounting software or set up

a reliable accounting method of your own, this is the year to do it. Diligent expense tracking is the first critical step to getting personal finances in order. 4. Consider advice on taxes and planning. Maybe you’ve always winged it with your taxes and considered your company 401(k) the ticket to your financial future. Chances are your planning is inadequate. Start getting references on good tax professionals and consider sitting down with a financial planner to discuss your retirement savings picture and what you can do to improve it. 5. Cut credit card debt. If you can’t ever seem to get yourself completely out of credit card debt, make this the year to do it. Take inventory of your balances, figure out if you can consolidate them under your lowest-rate card, and resolve to pay off an amount that exceeds the minimum – on time, every month. Oh, and pay cash from now on. 6. Save. If you haven’t signed up for your employer’s 401(k) plan or begun a savings plan tailored for the self-employed, this is the

year. And resolve to save at least 5-10 percent of your take-home pay based on your cash flow, and place the maximum in whatever retirement savings plans you qualify for. 7. Get ahead on your mortgage. This advice isn’t for everybody, but if you’ve paid off your credit cards by paying more than the minimum, you can apply the same principle to your mortgage payment. Every dollar you prepay will potentially save thousands in interest over the life of the loan if you plan to stay in your home long-term. In fact, if you make one extra payment a year, either at once or in equal monthly shares over the course of a year, you can cut at least five years of payments on a 30year loan. Just don’t short your retirement investment plans to accomplish this. 8. Invest in yourself. If going back to college or taking specific coursework will help you advance in your career, plan to do it. If investing in a health club membership that you actually makes sense for your health as well as

your insurance costs, do it. 9. Redefine the way you shop. If you’re an impulse shopper, break the habit this year. As a suggestion, get a legal pad and make that your centralized shopping list — use a single page for groceries, stock-up goods (it’s wise to start buying essentials in bulk if you can measure the savings), essential clothing or big expenditures you’ll need to make at specific times. Taking that pad with you wherever you spend money is a good way to keep a grip on your wallet as long as you don’t stray from the list. 10. Attack that miscella-

neous column. Do you really need deluxe cable? How much are you paying for your Internet service? Can you wear a sweater around the house and lower the thermostat? In every budget, there are items that can be cut — or at least trimmed. Take a hard look at all your “essentials” to see how essential they really are. Aim for a target of at least 10 percent and start setting that money aside on a regular basis. John Englin is vice president/financial planner and investment adviser representative for Lincoln Savings Bank in Waterloo. Contact him at (319) 233-1900.


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Nonpayers can hurt small businesses at tax time NEW YORK (AP) — It’s a bit of insult added to injury — small business owners who had nonpaying customers in 2008 are likely to find they can’t take the bad debts as deductions on their income tax returns. Tax laws limit the ability of many small businesses, among them service providers, to deduct the money customers never paid. That means owners need to try other methods of capturing the funds — and to be sure they don’t get burned again. What determines the deductibility of bed debts is the accounting method that a small business uses. Generally, service providers like auto mechanics, personal trainers and dentists use what’s called cash basis accounting. Under that method, income is recognized when it’s received and expenses are recognized when they’re paid for. So, income that’s never received can’t be recognized, and it can’t be deducted. “If you’re a cash basis business, you provide a service and you don’t get paid, you’re out of luck, you’re out your time and everything else,” said Barbara Weltman, a tax attorney in Millwood, N.Y., and author of “J.K. Lasser’s Small Business Taxes.” Companies that use what’s known as the accrual method of accounting generally have an easier time deducting bad debts.

Manufacturers and companies with inventory tend to use accrual accounting. Income is recorded when a sale occurs or a debt is owed, not when payment is received. Expenses are recorded when they’re owed, not when they’re paid. So, if a manufacturer ships goods, the income should be recorded on when the sale occurs. If the customer never pays, the tax deduction effectively allows the income to be wiped out. The company also gets to deduct the costs of manufacturing. Similarly, a service provider, say, a house painter, can deduct the cost of materials and supplies used in the job, but the business has to absorb the labor costs. The IRS has rules that can determine which accounting method a company can use. Publication 538, Accounting Periods and Methods explains them. It can be accessed at http://www.irs.gov/ publications/p538/index.html. Companies can and should try to collect unpaid debts, starting with requests to the customer. If it’s a customer an owner doesn’t want to lose, it might be a good idea to restructure the terms to make it easier for the customer to come up with the funds. The next step might be a collection agency. Certified public accountant Robert Moses noted that business is up at collection

Almost half of employees work sick The Associated Press

Feeling under the weather? You may cash in sick days when you’re coughing and sneezing, but that doesn’t mean your phlemgy colleagues stop coming into the office. A recent telephone survey by research firm International Communications Research found that about 45 percent of employees very frequently show up to work while sick, although managers believe only 17 percent do so. The survey encompassed 2,000 adults and 150 senior executives at the nation’s 1,000 largest companies. Staffing company OfficeTeam, a unit of Robert Half International Inc., offers these tips to help man-

agers avoid allowing ill employees to clock in: ■ Communicate expectations. Let staff know you prefer they stay home when they’re sick to ensure a quicker recovery and avoid infecting others. ■ Set an example. Sick employees are more likely to stay home if you do the same. ■ Give options. Allowing employees to work from home if they think they’re coming down with the flu can help them remain productive without spreading a potential illness around the office. ■ Offer help. Bring in temporary professionals to keep projects on track when employees are out sick for more than a day or two.

agencies — companies are turning to them for help, even though it means they might get just a fraction of what they’re owed. “If I can sell you something that I can’t collect, 10 cents on the dollar is better than nothing,” said Moses, chairman of the Small Business Outreach Committee of New York State Society of Certified Public Accountants. Collecting is impossible if a customer is really strapped for cash. John DeMartino, a CPA with M Advisory Group LLC in Eastchester, N.Y., said some of his clients have been bartering with non-paying customers to get something in return for unpaid invoices. Trying to avoid bad debts is probably the best solution. DeMartino said small businesses should “do credit profiles on their customers first, before ever extending credit.” And, he said, don’t be deterred if a customer doesn’t want to cooperate. “If you get any resistance from a customer, that should be a signal, maybe a key indicator, that

that customer isn’t creditworthy,” DeMartino said. Owners can also be sure they’re not left with bad debts by requir-

ing at least partial payment upfront, or by accepting credit cards, which shifts the burden of payment onto the card issuer.


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Cedar Valley Business Monthly  

You local business publication for the Cedar Valley

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