Volume 41, Number 16

UTAH’S BUSINESS JOURNAL$1.44Nov. 14-20, 2011www.slenterprise.com

THIS WEEK

• Calendar •See page 12.

Legal MattersSee page 6.

• Industry Briefs •Begin on page 4.

Utah housinginventory falls

22 percentSee page 3.

Tulsa firm to openpipeline integritycenter in Salt Lake

Virginia electrical firm that serves mining industryto enter Utah market

By Barbara RattleThe Enterprise T.D. Williamson Inc. (TDW), a leading provider of pipeline equipment and services, will unveil a Global Pipeline Integrity Center in Salt Lake City next year. The Tulsa-based firm, which already has approximately 200 Utah employees at a cluster of buildings in Murray, has leased 144,210 square feet at 369 N. Billy Mitchell Road and expects the new center to open its doors in the first quarter of 2012. Once complete, the world-class showcase facility will com-bine the TDW inline inspection engineering, manufacturing, oper-ations, service center and data analysis functions in one loca-tion. Current Utah employees will be relocated to the new center. Situated close to the airport in the Salt Lake International Center, the new site will double the current TDW footprint in the valley. Inline inspection involves the inspection of a pipeline from the interior of the pipe using an in-line inspection tool. The device or vehicle, also known as a “pig,” uses a non-destructive testing technique to inspect the wall of a pipe. Inspection of oil, gas, and

hydrocarbon pipelines look for defects and anomalies such as cor-rosion, dents, gouges, mechanical damage and cracks. Inspections are run to find issues so they can be proactively repaired prior to any potential leaks or damage. “Our goal is to create a Global Pipeline Integrity Center that not only houses our inline inspection capabilities but that also leverages the total breadth of TDW technologies,” said Eric Rogers, director of pipeline integ-rity solutions for TDW. In addi-tion to serving as a global hub for inline inspection, the center will showcase TDW pigging (pipeline inspection) products, including launchers and receivers, and pipe-line services, such as cleaning and non-destructive testing. “This new facility will also enable future growth, including

By Barbara RattleThe Enterprise Electro-Mechanical Corp., a Virginia-based firm that sells and repairs custom electrical equipment for mining companies, will enter the Utah market in January with a facility in Salt Lake City. The 58-year-old firm has leased approximately 12,400 square feet at 1232 S. Gladiola St. and will begin operations there with a staff of roughly six, said Howard Broadfoot, vice president of operations for the 700-employee, family-owned company. In Utah, Broadfoot said, the firm will do business as Line Power West, a sister company to Line Power Manufacturing Corp. in Bristol, Va. “They’re highly custom, the size of a semi,” Broadfoot said of the types of equipment Line Power sells and services. “They’re substations that power mining equipment underground and above ground. It’s relatively complex.” Equipment sold and serviced by Line Power includes longwall

controls, power centers, portable substations and transformers. “There are probably five companies in North America that do what we do,” Broadfoot said. “Back East we’re located in the heart of Appalachia because that’s where most mining takes place, but we do business in multiple countries. Our expectation is to do pretty well out there [Utah] because there’s not a lot of competition. We do a significant amount of business with the folks out there like Barrick Goldstrike and Kennecott and Sandvik. We just don’t have a local presence; everything we did would be managed from Virginia and it just doesn’t make sense to do that. So coming to Utah is as much economic for us as anything. It’s a great opportunity for us to expand because our business is booming when everyone else is seeing an

Doug Smith Autoplex in American Fork is preparing to nearly double the size of its Chrysler, Jeep and Dodge dealership. The dealership is located in about 25,000 square feet at 523 S. Main St. That structure will be razed, piece by piece, and replaced with a 45,000 square foot building, said company president Doug Smith. Work on an associated parking lot is under way, and construction on the building will begin as soon as the parking facilities are complete. Weather permitting, Smith said, the new building could be completed in as little as six months. FFKR Architects designed the new dealership, which will be built by STS Construction. Doug Smith Chrysler, Jeep and Dodge will remain open during construction. The dealership is one of several that Smith operates

at the autoplex. The others are Kia, Subaru and Suzuki. Smith said Chrysler, Jeep and Dodge sales have “picked up quite a bit,” prompting the decision to expand a facility that had already been outgrown. “It’s going to be a nice addition, mainly to our service and parts area,” Smith said. “We’ll have a bigger showroom, but it will really increase the amount of service and parts we can do.” Smith began his career in the automobile sales industry with a Chrysler Plymouth dealership in 1979. In 1997, he consolidated operations that were in Bountiful, Orem and Provo at the American Fork autoplex property.

Doug Smith to doublefootprint of A. Fork dealership

Survey: customers unaware of howmuch they pay in banking fees Buzz about bank fees has reached an all-time high and a new survey conducted by Ally Bank, Midvale, has identified what consumers consider the least acceptable bank fees, what they really want out of their banks and whether they know what they’re paying right now. Part of Ally Bank’s survey sought to find out if consumers are aware of how much they are already paying in ATM fees. When respondents were asked how much they estimate Americans pay in ATM fees per year, only 9 percent of respondents chose the correct answer. According to consulting firm Oliver Wyman, Americans spent $7.1 billion in ATM fees in 2010. Most respon-dents chose answers well below that, with answers ranging from

$100 million to $2 billion on the high end. Respondents were also asked to identify which bank-ing fees they feel are acceptable. Dissatisfaction with fees of sev-eral kinds was revealed with the responses, including: • 84 percent of respondents do not believe it is acceptable to charge a fee for checking. • 79 percent do not believe it is okay to charge a monthly maintenance fee. • 77 percent do not think it is all right to charge an ATM fee. According to the survey, a majority (56 percent) of respon-dents also believe that a “fair” fee for using an ATM is $0—no fee at all. However, a survey by Bankrate.com reports the average

Legal Matters

Legal Matters

Legal Matters

Legal Matters

Legal Matters

Legal Matters

Design Matters

Executive Lifestyle

Legal Matters

Staffing Matters

HR Matters

Real Estate Matters

Executive Lifestyle

Legal Matters

see TDW page 2

see LINE POWER page 2

see FEES page 2

Prestige Financial Services Inc., Salt Lake City, has estab-lished a $30 million senior secured line of credit with Chase. The line will serve as one of two primary sources of short-term revolving liquidity to fund the auto finance company’s consumer lending activities. The new line of credit rep-resents a renewed and expand-ing relationship between Prestige and Chase’s Utah operations, and comes on the heels of a $12 mil-lion amortizing term loan facil-ity that the two entities created in

September. The line has a renew-able one-year term. Now in its 18th year of oper-ations, Prestige Financial provides consumer financing solutions for automobile dealerships both within and outside of the Miller Group, the nation’s tenth largest auto retailer, in a total of 25 states. Prestige manages a $415 million portfolio An affiliate of The Larry H. Miller Group of Companies, Prestige employs more than 250 credit professionals and support staff to service a wide range of borrower types, and is recognized throughout the industry for its innovative lending programs and strong portfolio performance.

fee banks charge non-customers to use their ATMs is $2.40, with the most common fee charged now at $3. Also, more than half of those polled on behalf of Ally Bank (53 percent) said they would rather take time to search for a free ATM than pay a fee for the clos-est, time-saving option. The telephone survey was conducted by Opinion Research Corporation among a nation-al probability sample of 1,016 adults comprising 510 men and 506 women 18 years of age and older, living in private house-holds throughout the continental U.S. Interviewing was completed during the period of Oct. 20 to 23, 2011. The margin of error for the survey was +/- 2 percent.

2 The Enterprise Nov. 14-20, 2011

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the addition of a data center, customer and employee training facility, and pipeline test equip-ment for inline inspection tools,” Rogers said. TDW has had a presence in Utah since 2002, when it purchased MAGPIE Systems. Approximately 30 new jobs are expected to be created at the new center next year. FFKR Architects is designing the center. A gen-eral contractor has not yet been selected. TDW chose Utah as the site of the center not only because it has existing operations here, but also because of the state’s highly skilled and educated workforce, said Rogers. “TDW is a company founded on a strong value system of Integrity, Interdependence and Initiative. Our experience is that the people we employ in Utah have these values and it is an immediate fit culturally for us,” he said. “Having the right peo-ple makes the difference in any industry and TDW is committed to always hiring the best. That’s why we decided to stay in Utah, among other reasons.” TDW leased the space for its new center with the assistance of Kelsie Akiyama and Kyle Roberts of NAI West.

TDWfrom page 1

LINE POWERfrom page 1

FEESfrom page 1

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BYU to get major new life sciences building The Brigham Young University Board of Trustees has approved the construction of a new Life Sciences Building, to be built on the south end of campus. The Life Sciences Building will include 265,000 square feet of teaching and research space for the College of Life Sciences and will be constructed on the hill-side directly south of the John A. Widtsoe Building. The Life Sciences Building will have a total of five levels, including a three-level, 250-stall parking structure that will be integrated into the building. The building will be built at the current location of the Benjamin Cluff Building, which will be razed prior to construction. Construction will begin immediately and will be ongo-ing for approximately three years. The structure is estimated to be completed and occupied toward

the end of 2014. When finished, the building will include 16 teach-ing labs, three auditoriums, four conference rooms and more than 70 academic offices. All faculty and labs currently located in the Cluff and Widtsoe buildings will be housed in the new facility. Following the completion of the new Life Sciences Building, the Widtsoe building will also be razed. Okland Construction has been selected as the general con-

tractor for the project. In relation to the Life Sciences, the BYU Board of Trustees has also approved a 30,000-square-foot addition to the Monte L. Bean Life Sciences Museum. The addi-tion will be built on the east side of the current museum structure and will include as its centerpiece an exhibit of birds and bird art from the collection of President Boyd K. Packer of the Quorum of the Twelve Apostles.

Artist's rendering of the new structure, slated for completion in late 2014.

Prestige Financial establishes$30 million line of credit

After selling his 50 per-cent interest in the Provo/Orem office of Commerce Real Estate S o l u t i o n s , a Salt Lake C i t y - b a s e d commerc ia l real estate b r o k e r a g e , Jon Anderson has launched his own Provo broker-age under the name Anderson CRG. Anderson, who was a co-founder and principal broker at the Utah County office of Commerce Real Estate Solutions, said the branch, founded in 1998, had 24 agents when he sold his share. Newly formed Anderson CRG is operated solely by Anderson as this point, and he said he intends to keep the company small. Anderson has 30 years of commercial real estate experience and has been a broker in Utah for the past 13 years. He has handled transactions such as the recent sale of the land and buildings adjacent to the Provo Tabernacle that has been announced as the site for Provo’s second LDS tem-ple, and completed the assem-blage of most of the land for the NuSkin expansion i down-town Provo. Other transactions of note include the assemblage of land for the Tahitian Noni head-quarters in Utah County and the Utah Valley Specialty Hospital. Anderson’s list of clients include Novell, Symantec, Zions Bank, Verizon Wireless, AT&T, Qwest, First American Title and Wells Fargo Bank.

Real estate veteran launches new brokerage in Provo

Anderson

The Utah real estate market has seen positive trends over the past three months, and September was no exception, according to a new report from the Utah Association of Realtors. The month’s supply of hous-ing inventory fell more than 22 percent in September, which was the result of rising home sales and falling inventory. It would now take 8.9 months to sell all of the homes for sale at the current market pace. This is the quickest homes have been absorbed since 2007. “The month’s supply figure is particularly insightful because it looks at both inventory and sales,” said Kenny Parcell, 2011 president of the Utah Association of Realtors. “As month’s supply goes down, it suggests demand is growing while supply is decreas-ing. As this happens, home prices eventually strengthen.” In September, home sales rose 21 percent. With 2,823 sales, Utah Realtors sold nearly 500 more properties than they did last September. This is the fourth con-secutive month of rising home sales and the third consecutive month of double-digit increases. The trend was similar for year-to-date sales. For the first nine months of the year, purchases were up more than 5 percent com-

pared to the same point in 2010. Emery County had the high-est percentage change in closed sales in September, but 700 per-cent. It was followed by Duchesne County (up 233 percent), Beaver County (up 150 percent), Morgan County (up 75 percent), Weber County (up 43 percent), Cache County (up 38 percent), Salt Lake County (up 30 percent), Kane County (up 28 percent), and Washington, Juab and Carbon counties (up 25 percent). Sales increases are expected to continue. Signed contracts were up more than 27 percent compared to last September. For the year so far, pending sales are up more than 9 percent. The number of homes for sale dropped off sharply in September. Inventory was down nearly 22 percent. With 23,812 properties for sale, September had the fewest number of homes on the market since May 2007. In September, fewer proper-ties were put up for sale. New list-

ings were down about 13 percent compared to last year, likely a combination of homeowners wait-ing to put their homes on the mar-ket and fewer foreclosures being listed. Over the past year, the number of non-current mortgag-es in Utah has fallen, according to LPS Applied Analytics. Last September, more than 10 percent of Utah loans were either late or in foreclosure. This year, that num-ber has dropped to 8.8 percent. The median price of homes sold fell from last year. The medi-an price of $168,750 is about 10 percent lower than last year. The average Utah family now makes 168 percent of what is needed to qualify for a median-priced home. This measure takes into account both interest rates and home prices.Sellers also sold their homes faster in September. This year, it took an average of 89 days to sell a home versus 96 days last year.

The EnterpriseNov. 14-20, 2011 3

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A fi tness facility within the new City Creek Center development in Salt Lake City is coming closer to being a realty. Jacobsen Construction has been selected by City Creek Reserve Inc. as the general contractor overseeing fi nishes at the site, located near the Key Bank tower in an area that is largely still restricted to authorized personnel only. While Intrepid Agency, a local public relations and marketing fi rm representing City Creek, would not comment on the gym project, documents fi led with the Mountainlands Area Plan Room, a local resource for general contractors, indicates the facility will measure approximately 26,300 square feet. Subcontractor bids were due Nov. 8; an estimator for Jacobsen Construction said he was unable to identify the operator of the project, dubbed Gym @ City Creek, due to an agreement with City Creek Reserve. The Gym at Citycreek LLC has been registered with the Utah Division of Corporations and Commercial Code. Its sole manager is listed as V. Brent Cook, general manager of the Sports Mall, a long-time fi tness facility in Murray. Cook could not be reached for comment.

Fitness facilitytaking shape inCity Creek Center

Utah housing inventory fell by 22% in September

InComm Corp., an Atlanta-based marketer and distributor of stored-value gift cards and pre-paid products, will add 101 new jobs at an existing Utah operation over the next five years. The Governor’s Office of Economic Development last week authorized a five-year post-per-formance, single-payer refundable tax credit of up to $340,775 over the life of the project. The State estimates that InComm Corp. will pay more than $1.7 million in new state tax revenue, and will pay employees new state wages in excess of $21.7 million. The new employees are expected to earn wages that are 125 percent above the Salt Lake County average. InComm already has a pres-ence in Utah. It’s Murray location employs 25 people.

“The global expansion of technology solutions at InComm requires skilled technologists and the application of emerging soft-ware technologies,” said Matt Watson, chief technology officer of InComm. “We are investing in Utah because of its tradition of education and work ethic, techni-cally advanced workforce, distri-bution advantages and friendly business climate.” InComm’s suite of products includes gift cards, re-loadable debit cards, digital music down-loads, bill payment solutions and other online and point-of-sale technologies. In 2010, InComm processed $13 billion in retail sales transactions. Since 1992, InComm has offered products and services at more than 225,000 retail locations.

Atlanta firm to add 101 jobs in Salt Lake County

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• Industry Briefs • BANKING • Steve Gleason has joined Bank of Utah as a vice president in business banking. Previously, Gleason worked for Wells Fargo Bank, where he most recently held the title of senior vice president and manager of Northern Utah business banking and industry specialist groups. Gleason has worked for many years leading bank teams to reach revenue goals in loans and deposits in the hun-dreds of millions of dollars. He is an expert in providing finan-cial solutions and services such as treasury management, investments and regulatory needs to high-value clients. Gleason has managed and grown multimillion dollar portfo-lios for universities, municipali-ties, school districts, hedge-fund managers, medical groups, law firms and off-shore companies. • TAB Bank, Ogden, provid-ed $30 million in working capi-tal facilities for several businesses during the month of October. The facilities were provided for com-panies across a broad spectrum of industries. Four transactions were A/R lines of credit totaling $11 million. Two were ABL lines of credit for $3.75 million. Fifty-six were equipment loans for $14.2 million. One was participation loan totaling $750,000. One was

capital lease purchase from a lease originator for $300,000. • Brighton Bank has released mobile and text banking for all of its online customers. This allows users to check account balances, transfer money between accounts, view recent transactions, pay bills and locate branches and ATMs while on the go. Customers can use any smartphone browser to access mobile banking and there are also applications available for both iPhone and Android users. Text banking can be done on any phone with texting ability. • Bank of American Fork was honored Nov. 8 with this year’s CRA Community Impact Award at the 2011 CRA & Fair Lending Colloquium in Baltimore. The national award recognizes only two financial institutions that have been instrumental in devel-oping, implementing or maintain-ing innovative community devel-opment programs that support the Community Reinvestment Act (CRA). Bank of American Fork was recognized for its role in the construction of Rosewood Place Senior Living Center for low-income Utah residents. In addi-tion to providing a $1 million construction line of credit, Bank of American Fork was the lead investor with a $1 million contri-bution to the project.

• Zions First National Bank has for the 18th consecutive year been named the top lender of U.S. Small Business Administration (SBA) 7(a) loans in Utah during 2011. Zions has been the top SBA lender in Idaho’s Boise District for the past 10 consecutive years. Zions Bank and its affiliates approved 555 SBA 7(a) loans in Utah, totaling $77.3 million for the fiscal year ended Sept. 30, 2011. These loans represent 35 percent of the 1,561 SBA-backed loans approved in the state during fiscal year 2011. Capital provided through Zions Bank’s SBA loans helped Utah businesses grow so that they could hire 1,218 new employees and retain 4,314 posi-tions, totaling 5,532 jobs, accord-ing to SBA data. • Following months of con-struction and planning, young patients at Primary Children’s Medical Center are now benefit-ing from the gift of play, relax-ation and sunshine thanks to a new outdoor Hope Garden donated by the We Promise Foundation, the charitable arm of HeritageWest Credit Union. Featuring growing boxes that children helped plant, an area for arts and crafts, color-ful play equipment and electri-cal outlets for children who rely on IV’s and pumps around-the-clock, the Hope Garden provides

a place where all young patients can benefit from therapeutic play. A $12,183 donation from the We Promise Foundation was present-ed during the 27th Annual Primary Children’s Miracle Network Telethon. In addition to the dona-tion, HeritageWest Credit Union employees manned telephone lines while viewers phoned-in pledges from across the area. CONSTRUCTION • Engineering News Record named two R&O Construction projects as recipients in its recent Mountain States Region’s 2011 “Best Projects” competition. In the category of cultural/worship, St.

Joseph the Worker Parish in West Jordan earned the Award of Merit. The Redford Conference Center in Sundance was named the Small Project Award of Merit. R&O is based in Ogden.

EDUCATION/TRAINING • The Living Planet Aquarium in Sandy has added two members to its board of trustees. Ryan Davies founded Renewable Energy Development Corp. a renewable energy development company that develops, owns and operates wind and solar projects. Jim Loveland is president and CEO of Xactware Solutions Inc., a provider of software, analytics and business services to the property insurance industry. • Utah’s Hogle Zoo walked away with two awards for their efforts in environmental educa-tion from the Utah Society of Environmental Education at its annual award ceremony in October. The zoo won in the categories of Environmental Program of the Year and Environmental Volunteer of the Year. Utah’s Hogle Zoo won the Program of the Year award for its series of Boy Scout meritbadge classes that are designed to not only fill badge requirements, but also to instill awareness and a sense of stewardship of the envi-

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ronment. Additionally, Hogle Zoo won the award for Environmental Volunteer of the Year. It was awarded posthumously to Janet Ryan-Finlayson to honor her years of dedication to environmental education, Hogle Zoo and the res-idents of Utah. Ryan-Finlayson served as a zoo volunteer for 30 years.

HEALTH CARE• Brent James M.D., chief

quality officer at Intermountain Healthcare, Salt Lake City, has received the Deming Cup award from Columbia Business School’s W. Edwards Deming Center for Quality, Productivity and Competitiveness. The award is given annually to an individual who has made outstanding contri-butions in the area of operations and has established a culture of continuous improvement within his or her respective organization.

HOSPITALITY• The 125 year-old

Homestead Resort in Midway will temporarily close the sec-ond week of December to begin its first phase of enhancements. The resort will reopen in April 2012. This first phase of improve-ments will focus on upgrading the guest rooms while preserv-ing the historic charm that has been a staple characteristic of the Homestead. Current plans include upgrades to the bedding package, drapes, carpeting and new televi-sions. Additional upgrades being planned include improvements to the Homestead Golf Course, with modernized irrigation systems and rebuilt tee boxes, sand traps and cart paths. During the closure,

many of the Homestead associates who would typically be employed over the winter months will be fill-ing open positions at the adjacent Zermatt Resort. • Bill Malone, president and CEO of Park City Chamber/Bureau, has been named a direc-tor of Western Association of Convention and Visitors Bureaus (WACVB). Named to the orga-nization’s board of directors was Sara Toliver, president and CEO of Ogden/Weber Convention & Visitors Bureau. WACVB is a regional professional association serving more than 135 destina-tion marketing organizations in the western United States and the western provinces of Canada. Each member bureau is the official des-tination marketing organization for its city, county or region. INSURANCE • The Utah chapter of Women in Insurance & Financial Services welcomed two new board members for the new year as part of the group’s ongoing succession plan. Debbie Engebretsen and Linda Rino have joined the chap-ter’s board. Engebretsen currently works with New York Life and has been in the industry three years as a financial services professional. Rino has 23 years in the banking industry, working for Zions Bank as a vice president/branch man-ager. The board’s president, Vicki Tu’ua, has moved into the past-president role, and Amber Dixon was elected as president. Tu’ua is a long-time financial services pro-fessional with State Farm. Dixon is a marketing and communica-tions director with Intermountain Financial Group/MassMutual with 10 years of industry experience.

LAW • The Utah Defense Lawyers Association awarded its Legacy Award to Salt Lake City lawyer Roger Bullock at the associa-tion’s annual meeting, in recogni-tion of excellent and distinguished contribution to the legal commu-nity. Bullock is a shareholder at the firm of Strong and Hanni, and has handled numerous com-plex trials and settlements over his career. The award noted his con-tribution to fairness and civility among lawyers and his mentoring of young lawyers. • The law fi rm of Durham Jones & Pinegar has named Mark L. Astling, Peter H. Donaldson and Rick L. Guerisoli as shareholders. Astling joined the fi rm’s Salt Lake City offi ce in 2009. He advises clients on federal and state tax issues, including business formations, equity compensation, mergers and acquisitions, debt and equity offerings, tax accounting and other tax planning matters. He also represents taxpayers in IRS and state audits, administrative appeals and in U.S. Tax Court. Donaldson also joined the fi rm’s Salt Lake City offi ce in 2009. His practice focuses primarily on commercial litigation matters, including

representing clients in state and federal courts and in arbitration. He represents clients in contract, tort, construction, real property, class action, securities, corporate governance, employment, health care, insurance, franchising, banking and intellectual property matters. Guerisoli has been with the fi rm’s St. George offi ce since 2004. He advises private and public companies on legal issues ranging from entity formation, operations, employee matters and contract preparation and negotiation to corporate fi nance and business combination transactions, including securities offerings, debt and equity fi nancing transactions, mergers, stock/asset acquisitions and other corporate partnering transactions. • Jenifer Tomchak of the Salt Lake City law fi rm of Parr Brown Gee & Loveless has been named president of the Young Lawyers Division of the Utah State Bar. Tomchak focuses her practice on labor and employment litigation, commercial banking issues and complex commercial litigation. In her role as president, Tomchak will represent the YLD and lead approximately 60 board members as they implement the monthly networking, educational and community service programs.

• Prince, Yeates & Geldzahler paralegal Karen Kendrick recently received the Heart and Hands Award from the Utah Nonprofi ts Association and the Utah Society of Fund Raisers as part of Utah Philanthropy Day 2011. Kendrick has volunteered with the Girl Scouts of Utah for 20 years. The Heart and Hands Award honorees are individuals recognized for their volunteer and philanthropic contributions to charitable causes in the community. • Sara Nielson has joined the Salt Lake City fi rm of Parr Brown Gee & Loveless as an associate. She received her law degree magna cum laude and Order of the Coif from the J. Reuben Clark Law School, where she was editor of the BYU Law Review, executive editor of the BYU Journal of Public Law and senior editor of the BYU International Law and Management review. • Best Lawyers has named Durham Jones & Pinegar shareholder Steven J. McCardell as the 2012 Salt Lake City Bankruptcy and Creditor Debtor Rights/Insolvency and Reorganization Law Lawyer of the Year. Best Lawyers chooses one lawyer from each community

continued on page 9

6 The Enterprise Nov. 14-20, 2011

Admit it! You have thought about leaving your current job to start a new company, and you are not alone. As a member of the busi-ness group at Strong & Hanni, I often consult individuals who are thinking about starting a new company but are not sure when or how to leave their cur-rent employer to do so. This article addresses seven of the issues you should consider before quitting your day job. 1. Review all cur-rent agreements with your cur-rent employer. You may have signed an offer letter, confidenti-ality agreement, invention assign-ment agreement and other agree-ments during the course of your current employment. Other rel-evant documents might include an employment agreement, employee handbook, conflict of interest pol-icy or severance/separation agree-ment. These documents should be reviewed carefully for provisions

that may inhibit your future startup company. Enforceability of some provisions in these documents, such as non-compete clauses, gen-erally depends on the state where

the employee is located. Reviewing the docu-ments for the following provisions is important. Confidentiality. Most companies require employees to sign a con-fidentiality agreement that prevents the employee from using or disclosing employer confidential

information except for the benefit of the employer. These confiden-tiality provisions are typically for an indefinite period of time, as opposed to a finite period like five years. In any event, most states prohibit the misappropria-tion of trade secrets as a matter of law, regardless of whether the employee signed a confidential-ity agreement or not. Thus, you should ensure that you do not use former employer confidential

information in connection with your new company. Invention assignment. Many companies require employees to assign inventions created dur-ing employment to the employ-er. Invention assignment agree-ments are especially common with technology companies. An invention assignment agreement may mean that what you thought was belonged to you (because you developed it) actually belongs to your former employer. Non-compete. Non-competes are only enforceable if they are reasonable in scope and duration. Twenty-four months following employment is a typical duration for a non-compete. The scope of a non-compete refers to both the geographic area and the nature of the competing business. Among other things, violation of a non-compete can result in the dis-gorgement of profits from the new company. Non-solicitation of customers and vendors. Some employment

documents also include a prohibi-tion on soliciting customers and vendors of the employer. Like non-compete agreements, non-solicitation agreements must be reasonable in terms of scope and duration. Non-solicitation of employ-ees. Most companies require employees to refrain from solic-iting employees for a specified term, such as one year after ter-mination of employment. Thus, if you intend to hire former co-workers for your new venture, you need to carefully navigate the bounds of permissible action under these clauses. Please also keep in mind that key employees of company may be subject to fiduciary duties to the company and may be subject to claims of breach of fiduciary duty, fraud and intentional interference with contract for soliciting co-workers even in the absence of written agreements. 2. Return confidential infor-mation. Most employment-related

agreements require employees to return all company property to the employer. A typical clause would likely state that upon separation from employment with the com-pany or on demand by the com-pany during your employment, you will immediately deliver to the company, and will not keep in your possession, recreate, or deliver to anyone else, any and all company property. You should carefully search all electronic and paper files for any employer material, including temporary internet files, emails sent to personal addresses, e-mail contacts and other types of infor-mation. The inadvertent retention of these materials can be used by the employer in future litigation and jeopardize your new com-pany. 3. Limit pre-resignation activities. Creating intellectual property related to the current employer’s business, or otherwise using the current employer’s time

Don't quit your day job (just yet)

Nate Brower

see DAY JOB next page

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EVEN THE BIGGEST BUMPS ARE JUST PART OF THE ROAD.Over the years, we’ve helped countless businesses get the cash flow they need to keep moving, and we can do the same for you. Learn how at tabbank.com or by calling 801.624.4415.

Any small-business owner will tell you that the difference between success and failure is very slim. Time management, attention to detail and non-stop activity are often the keys to a winning busi-ness. The demands on an owner’s time are a real and constant threat to success, so busi-ness owners everywhere have begun relying more and more on their banks to provide them time and money-saving services to help them run their busi-nesses more efficiently and effectively. Banks today offer a wide variety of products and ser-vices for their commercial bank-ing clients to fit their needs, all designed to provide an added value to their banking relationship. Different banks offer different ser-vices, and not all treasury services are available at every institution. It’s important to know what your

bank has available to you while also knowing what other institu-tions can offer. Some of the most commonly used banking and trea-sury services available today are: Business Accounts – Today businesses are offered a full suite

of products and ser-vices designed around their unique individual needs. Checking, sav-ings, money market accounts and certificates of deposit are all avail-able to businesses and their deposited funds. Business owners can customize their relation-

ship based on what is best for them while maximizing their return in the form of interest earned, account access and functionality, and over-all service provided. Online Banking Services – Business owners save time and money by managing their business accounts through secure online

banking sites. Online banking typi-cally allows business owners to pay bills online, reconcile their monthly bank statements, view images of paid checks, transfer funds between accounts, and much more. Additionally, mobile banking via mobile Web and smartphone apps has given business owners secure access to banking while on the go. Remote Deposit Capture – This service gives business own-ers the ability to scan and deposit checks into their bank accounts directly from their office. This time and money-saving option elimi-nates the need to send employees to the bank to make deposits and often speeds up the time it takes to collect on the deposits. Merchant Services – Allows businesses to accept credit and debit card payments from customers. Funds are debited directly from the customer and are typically depos-ited to the business within 24-48 hours. Merchant services reduce the risk of accepting checks and provide a convenience to the busi-nesses primary clients. Rates and fees can vary dramatically between providers, so business owners need to work with a bank that offers them the best combination of costs and benefits. Lockbox Services – This banking service simplifies the col-lection and processing of payments from clients. Customer payments are mailed directly to a single loca-tion where they’re accepted by the bank in bulk and processed throughout the day. Accounts

receivable collection is streamlined with this service saving business owners time and speeding up the availability of collected funds. Sweep Account Services – Sweep accounts allow business owners to maximize their return on deposited funds. At the end of each business day, money in excess of a pre-determined amount is automatically moved or “swept” into savings to produce the largest return on their cash on deposit. Typically money is moved when balances rise or fall below specific high and low-dollar limits. Choosing a banking relation-ship is more important than simply picking the bank closest to your office. Researching available financial institutions to determine the services offered and costs involved can save today’s business owner time and money. Making sure you are getting everything out of your banking relationship will go a long way toward the overall success of you and your business.

Eric Myers is the director of mar-keting at TAB Bank, Ogden. He has been selling and marketing financial products for the last 20 years. Myers can be reached eric.myers@tabbank.com. TAB Bank provides custom working capital solutions — accounts receivable financing, lines of credit, equip-ment loans and asset-based loans — to transportation and non-trans-portation companies in all stages of business life cycles during any economic conditions.

Business banking and treasury services — convenience designed for all business owners

Eric Myers

or resources can be problematic due to typical invention assign-ment clauses in employee doc-uments. You must avoid using equipment (including employer-provided laptops, time, know-how, or other resources of your employer) in connection with your new startup company. In addition, no customers should be solicited for the new company, and no co-workers should be invited to quit and join the new company before resignation. Keep in mind that key employees, such as officers, directors and managers may owe a fiduciary duty of loyalty to the company, regardless of whether there is a written agreement. This fiduciary duty would prohibit an employee from doing anything to harm the employer, such as competing with the employer or usurping and business opportuni-ties of the employer. 4. Prepare for the exit inter-view. Many employee documents require employees to submit to an exit interview. You should not lie in an exit interview if they are asked about your plans. While there is no particular obligation to tell the truth, even a slight misrepresentation may be used against you in future litigation to show dishonesty. You should prepare a high level, but truthful, response to any direct inquiries by an employer regarding future plans. If you are going to form a competing company, the former employer will learn about it any-way if it is successful. You should also be prepared

to make written representations to your prior employer that you have returned all company information and material, and will continue to comply with confidentiality obli-gations. 5. Stay on good terms. Sometimes litigation aris-es simply because the former boss of a departing employee has a vendetta against the employee. Keeping on good terms with your former employer may also be helpful if the former employer is a potential investor, customer or supplier for your new startup company. 6. Don’t forget about stock options and benefits. Most stock options expire within 90 days of the last day of employment. In some cases, the time period is shorter than 90 days. If you want to exercise a stock option from your current company, you need to make sure that you do it within that time period. Of course, exer-cising a stock option will require the employee to pay the exercise price for the options, and in some cases, the aggregate exercise price may be significant. 7. Consult with an attor-ney. Many of the issues described above are fairly tricky and the advice of a competent attorney is recommended.

Nathan G. Brower is an attorney at Strong & Hanni Law Firm. His practice focuses primarily on cor-porate and securities law for busi-nesses of all sizes. He has sig-nificant experience representing clients with private equity transac-tions, mergers and acquisitions, SEC reporting, private place-ments, public offerings, and other business transactions. He can be reached at nbrower@stronand-hanni.com or (801) 532-7080.

DAY JOBfrom previous page

The Enterprise Nov. 14-20, 20118

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Emergency Essentials Inc.653 N. 1500 W.Orem, UT 84057

Founded in October 1987 by David E. Sheets, Emergency Essentials Inc., (www.beprepared.com) is in the business of help-ing prepare for emergencies by offering goods and services. No matter what individual circumstances may be or where we live, life happens and we’re all vulnerable to challenges. Whether it is unemployment or manmade or natural disasters, having emer-gency provisions on hand adds confidence when faced with life’s challenges. Becoming prepared is simply a provident principle to pursue. The senior management team consists of David E. Sheets, president and founder; Matt Nettesheim, executive vice president; and Shane Sullivan, vice president. Emergency Essentials employs more than 150 people, from Utah Valley Bountiful. Its retail stores are located in Orem, South Jordan, Murray and Bountiful.

••••• Q: What brought you the most satisfaction with this busi-ness? Shane Sullivan: Knowing that our goods and services help relieve stress in an emergency by instilling confidence to confront unexpected emergencies. Q: How did the recession affect you? Sullivan: Very few if any individuals or companies came away unscathed from the effects of the recession and far too many are still reeling from the effects. Like many businesses, we found that some of our customers wanted to purchase our supplies but were unable to financially. However, there were others that real-ized the prudence of preparing and decided now was the time to purchase. Q: How do you feel the Utah economy is doing now? Sullivan: Overall it seems to be doing better than most states.

Emergency essentials has locations in Orem, South Jordan, Murray and Bountiful.

Emergency Essential's products include food storage, emergency kits, water filtration devices, meals ready-to-eat, first aid, survival kits and camping gear.

The EnterpriseNov. 14-20, 2011 9

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and in each practice area to be honored as Lawyer of the Year. McCardell serves as the chair of the fi rm’s Bankruptcy & Creditors’ Rights section.

MANUFACTURING • USANA Health Sciences, West Valley City, is currently constructing the largest solar panel installation by a non-governmental organization in Utah. It is estimated the panels will, located on the roof of the firm’s headquarters, will produce about as much power annually as would be used by 24 average Utah households in a year. USANA’s solar panels will generate 167 kilowatts of electricity at peak production, eliminating more than 270 pounds of sulfur dioxide, 330 pounds of nitrogen oxide emis-sions and 190,000 pounds of car-bon emissions annually. • Packsize International LLC, Salt Lake City, has been recognized by Supply & Demand Chain Executive magazine as a 2011 Green Supply Chain Award recipient. Packsize On Demand Packaging resolves inventory and shipping complexities through the ability to create a custom-sized box for every order. This efficient and cost-effective, just-in-time packaging system has become a leading sustainable business prac-tice, resulting in less waste, lower shipping costs, decreased damage rates, and increased customer sat-isfaction.

MEDIA/MARKETING • Freestyle Marketing Group, Salt Lake City, has pro-moted Shawna Gunther to account executive and Annie Paul to business development coordi-nator and hired Catherine Groya as associate art director. Gunther has a B.S. degree in mass commu-nications from the University of Utah. Paul is also graduate of the University of Utah, with a H.B.S.

in marketing and minor in rhetoric & writing, Annie started at the agency as an intern assisting with Research and Account Planning. Groya was formerly a designer for a retail and screenprinting compa-ny in Pennsylvania. She is a grad-uate of Kutztown University with a bachelor’s of fine arts degree in communication design. REAL ESTATE • The Salt Lake City com-mercial brokerage firm Mountain West Retail/Investment is utiliz-ing an increasingly popular tech-nology for potential property buy-ers and tenants: QR codes. With the rollout of its new website, Mountain West Retail/Investment will begin using QR codes on its listing fliers and signs. Currently, if a tenant or buyer is interested in a property, they have to call the listing agent for information, such as square footage, lease rates and more. By implementing QR codes, all the necessary informa-tion on a property will be avail-able with a quick scan. • In the Salt Lake City metro area, average home prices fell by 5.3 percent in the past year but are expected to rise by 0.3 percent by the summer of 2012. According to Fiserv Case-Shiller projections, home prices in Salt Lake City will see a growth of 8.9% between Q2 2012 and Q2 2013.

RESTAURANTS • Chick-fi l-A opened its fi rst stand-alone restaurant in Salt Lake City on Nov. 10 at 1206 E. 2100 S. in historic Sugar House. The new restaurant is the fourth to open in Utah this year and brings with it 60 new jobs. ‘ • Bambara, a Kimpton restaurant in downtown Salt Lake City, will welcomes wine lovers and foodies to the fi rst Sip & Savor Soiree, featuring Dawn Gaudini from Dalla Terra

from page 5

continued on page 13

The Enterprise Nov. 14-20, 201110

Can you recite your mission state-ment? My bet is you can’t. Mission statements are prominently displayed on most websites and within company literature, but rarely used by the people they were designed for. Want a dose of mission statement reality? Here are 13 questions designed to make you think, squirm and reassess your mission and its meaning: 1. Who created your mission state-ment? 2. What does it mean to you? 3. Do you have it memorized? 4. Do you use it as a guiding light? 5. Do you have it up on the wall in your office? 6. Do you have it on a card in your wallet? 7. Is it your computer wallpa-per? 8. Does it in any way affect your corporate behavior? 9. How do your customers benefit from it? 10. Does it inspire you? 11. Does it motivate you to make more sales? 12. Do any of your customers know your mission? 13. Or is it just a bunch of BS that your marketing people —or worse, your ad agency — created? Most mission state-ments are created for PR purposes, pur-ported image or some other form of busi-ness pomposity. Totally bogus. If the mission statement is so impor-tant and so genuine, why doesn’t EVERY employee commit it to memory and execute it every day at work? Pretty sad, huh? It’s formally called “a mission statement,” but the reality is, IT’S THE MISSION. YOUR MISSION! Is that how you treat it? Do you walk into a sales call thinking, “I gotta carry out the mission”? Have you ever given a sec-ond thought to your mission statement? Or is it just some empty, full-of-crap pabulum drawn up by people who have no concept of reality, let alone sales, let alone your mission? I’d like to have the money that giant corporations paid OUTSIDE PEOPLE to “create” their mission statement. Better yet, just give me 10 dollars for every CEO that can’t recite it. Well, all of that got me thinking about the real mission, and I realized that there are several missions needed for every com-pany. One mission doesn’t fit all. When I started to list the mission statements needed, it became apparent that these “missions,” if written by the peo-ple responsible for their execution, could change the culture of any company for the better. Here are the missions I came up with: • Company Vision — It’s easier to make missions if you have clear (big picture) vision. Start there. What are you seeking to achieve? Not be the No. 1 blah, blah. Rather, how will you help, who will benefit, and what will THEIR outcome be? Vision should be two paragraphs: one about people and one about business. • Company Mission — Words about how you will act, the quality you purvey,

the fairness you’ll set an example for, the value of what you’ll provide, the loy-alty you’ll seek to earn, the honesty you’ll speak and the integrity you’ll display. • Sales Mission — Your sales mission is your REAL mission. Without it, sales-people will wander into a sales call with-out a purpose other than “trying to make a sale.” MY SALES MISSION: Get the customer to buy from me based on value and relationship, and make the experience so memorable that they buy again, and tell other people how great I am. What’s your sales mission statement? How does it reso-nate with your salespeople?

• Customer Mission — What do you want your customers to say about you? How do you want them to view your quality, value, eth-ics, service, friendliness, ease-of-doing-business, fairness and speed of response? All of those elements should be addressed in your cus-tomer mission statement. • Employee Mission — Not

a “policy,” rather a statement of how you will treat people, com-municate with people, train and

educate everyone, provide opportunities to succeed, provide a workplace atmo-sphere to succeed and be truthful with your people. This statement puts your business philosophy for all to see, and sets the tone of your environment and the expectation of your people to serve and be memorable. • Vendor Mission — Your business couldn’t operate without your suppliers. How are you ensuring that you will thrive without squeezing and choking the profit out of them? How are you partnering with them to grow sales? How will they feel about doing business with you? • Profit Mission — What are your profit motives? How will you invest your profits to grow people and business? How will you earn your profit? What actions are all employees to take to ensure maximum profit without sacrificing ethics? • Community Mission — What is your local commitment to involve yourself and your company? What are you volun-teering for? How are you helping? What outcome are you hoping for? How will the community win? MAJOR CLUE: Make the mission statement congruent with the mission. How congruent is your mission statement? MAJOR CLUE: Missions are easiest to create by the people that execute them. Who’s creating yours? Who is executing yours? Maybe it’s time to revise your mis-sion. Just a thought.

Jeffrey Gitomer is the author of The Sales Bible, Customer Satisfaction is Worthless Customer Loyalty is Priceless, The Little Red Book of Selling, The Little Red Book of Sales Answers, The Little Black Book of Connections, The Little Gold Book of YES! Attitude, The Little Green Book of Getting Your Way, The Little Platinum Book of Cha-Ching, The Little Teal Book of Trust, The Little Book of Leadership, and Social BOOM! His website, www.gitomer.com, will lead you to more information about training and seminars, or e-mail him personally at salesman@gitomer.com.

© 2011 All Rights Reserved

It's a the MISSION! Or is it?

Jeffrey Gitomer

By Russell Lookadoo In developing their annual strate-gic plan, many companies go offsite and “retreat,” I often cringe when hearing this term, although I heartily endorse the process. My issue is the image the label “retreat” creates in the mind. Retreating is an inherently defensive and reactionary move that the leaders of the company are leaving the field with their tails between their legs. This is certainly the perspective the non-attending employees have when their leadership “retreats.” They are subcon-sciously asking themselves: • Are we losing? • Why are they hiding? • Is it time to wave the white flag? • Will we be able to keep our personal firearms and horses? But the need for having such a meeting is essential to prepare for the unknowns in the future. The invested time in a focused, non-interrupted session will clearly pay great dividends the coming months. So I suggest you consider an alterna-tive label for your strategic planning event. Depending on the focus and circumstances, it can be called a strategic planning meet-ing, a company renovation or renewal, a planning rally or, in my Southern vernacu-lar, a company revival. Read these titles aloud and see how you emotionally react. My guess is your co-participants will come into the session with vastly different mind-sets depending on the term you chose. Having participating in and facilitated such gatherings in corporate, government, nonprofit and small business environments, there are a few points that can make or break the event. • Get into a comfortable, neutral set-ting. Sorry, the boss’ house does not quali-fy. Basic physical needs need to be satisfied so that the brain will be fully powered up for the tasks at hand. • Establish an “Up Front Contract” for the event. This is often accomplished through the use of a formal, written agenda that is adopted before, or very early in, the event. • Have clearly defined outcomes. Let your co-participants know and agree to the expectations of the event. • Create an atmosphere of safe and open communication. I refer to this as a “tabenos” environment based on the Greek concept of temenos. C.G. Jung relates the temenos to the spellbinding or magic circle, which acts as a “square space” or “safe spot” where mental “work” can take place. • Have clear assignments and deliv-erables, including who is to do what and by when as follow ups. These need to be clearly documented shortly after the event. • Have a process for follow-up creat-ing accountability and resulting in keeping the plan alive. The biggest mistakes that result from these retreats is that massive binders are produced and placed squarely on a credenza or bookcase and never looked at again. Wow, this looks like a lot of work just in preparing, running and following up on the event. Yes it is, and as a participant you have to choose between being in the meet-ing or leading the meeting. The result of try-ing to do both is a recipe for compromise,

and the results will not be satisfactory. Here are some of the costs of the com-pany leader trying to do both: • Time is wasted. • Participants don’t feel heard and sabotage the decisions. • Participants feel alienated. • Participants withdraw and withhold vital information. • Participants get frustrated and have unproductive conflict. • Participants get hurt and the team is wounded. • The team stalls. • The meeting falls apart. So my final tip for a successful plan-ning event is to utilize a trained and expe-rienced facilitator. Because the facilitator does not have their own agenda, and has nothing at risk, they will: • Manage meeting time so it is used efficiently. Meeting time is extremely expensive when you consider all of the person-hours, travel, etc., so this is a high priority. • Make sure everyone feels heard. This increases “buy in” to whatever decisions the group makes, which increases the likeli-hood that everyone will do their part in the future. • Help people find common ground, come to agreements, make decisions. • Help the team surface the individual and collective undercurrents. • Help the team manage conflicts and come to some resolution. • Make sure that the next actions are clear and that all understand what is to hap-pen in the future. Those who move forward without a plan are indeed planning to fail. The stra-tegic planning event, however it is labeled, is an essential best practice to do, and to do right.

Russell Lookadoo is president and chief strategist of HRchitecture, a consulting firm that helps business leaders accomplish their goals by effectively using their teams. He owns The Alternative Board practice in the Salt Lake metro area, which establishes peer advisory and provides coaching solutions to leaders of privately held businesses.

Retreat, renewal, renovation, rally or revival

The EnterpriseNov. 14-20, 2011 11

The October employment report was kind of like kissing your sister — a little tingle here and there, but not all that exciting (actually I never had any sisters!) The report did support the idea that modest U.S. economic growth is likely to continue, with a lesser chance of a renewed recession. The American economy added 80,000 net new jobs during October, less than the 100,000 net new jobs expected by forecast-ing economists. Better news saw the two prior months’ job creation estimates revised higher, with a net gain of 102,000 additional jobs over the two month peri-od. August employ-ment gains were revised from 57,000 net new jobs (already revised once) to 104,000 jobs. Not bad for a month whose initial esti-mate on Sept. 2 was no change whatsoever in total employment. September’s estimated gain was revised from 103,000 jobs to 158,000 jobs. Still, the 80,000 net new jobs total in October was the weakest of the past four months. At the same time, the October gain was the 13th consecutive month of employment gains after 25 brutal months of job losses from early 2008 to early 2010. The 2.2 million net jobs gained since the beginning of 2010 offsets only one-quarter of the 8.8 million jobs lost during the Great Recession (see the kissing your sister anal-ogy?)

9 Percent Better news saw the nation’s unemployment rate decline slight-ly to 9 percent in October after being fixed at 9.1 percent the three prior months. The consen-sus view had the rate remain-ing unchanged. Still, the nation’s unemployment rate has averaged 9 percent over the past three years, with only limited prospects of any sizable decline (hey sis!) Most estimates of the unem-ployment rate on Election Day 2012 (now less than one year away) are between 8.5 percent and 9 percent. If I can offer this tidbit one more time … no sit-ting American president has been elected to a second four-year term in the past 75 years with an unemployment rate above 7.2 percent. Also as noted before, the President’s focus now and likely throughout 2012 will be on a job creation agenda. It ain’t rocket science.

The Two Surveys With recently released data, one might ask how a less-than-expected gain in jobs leads to an

unexpected decline in the nation’s jobless rate. The answer remains a tale of two surveys. The “official” job creation number — in this case a net gain of 80,000 jobs in October — was derived from a survey of roughly 400,000 medium and large-sized businesses operating within U.S. boundaries, known as the “estab-lishment survey.” The unemployment rate comes from a smaller and usually more volatile survey of roughly

60,000 households, known surprisingly enough as the “house-hold survey.” This sur-vey in October esti-mated the labor force to have risen by 181,000 people, estimated total employment to have risen by 277,000 people, estimated the number of unemployed people

to have declined by 95,000 and — presto chango — a 9 percent unemployment rate. Many practitioners of “the dismal science of economics” would suggest that the house-hold survey is better at picking up changes in self-employment and the expansion or contraction of employment at very small firms than is the much larger establish-ment survey. Over time, the two surveys will typically move closer together.

The Details The nation’s goods produc-tion sector lost an estimated 10,000 jobs during October, with the loss of 20,000 construction jobs more than offsetting a gain of 5,000 jobs in both manufacturing and mining and logging. According to the Bureau of Labor Statistics of the U.S. Department of Labor, employment in both residential and nonresidential construction has shown little net change in 2011. Meanwhile, the nation’s manufacturing sector has been flat

during the past three months. The nation’s mining and logging sec-tor has added 152,000 net new jobs since a low point in October 2009. The nation’s private service providing sector registered the addition of 114,000 net new jobs in October, led by a gain of 32,000 jobs in professional and business services. The “p&bs” sector has added an estimated 562,000 jobs during the past 12 months. The education and health services sec-tor added 28,000 net new jobs dur-ing October, with 12,000 of those in health care employment. The health care sector has added 313,000 jobs during the past 12 months. Leisure and hospital-ity employment rose by 22,000 in October, with an estimated gain of 344,000 jobs since a low point in January 2010. Retail trade added 18,000 jobs last month, with a gain of 156,000 jobs during the past 12 months. According to the BLS, employment in other major sectors including wholesale trade, transportation and warehousing, information, and financial activi-ties changed little during October. And then there is govern-ment. Total government employ-ment declined by an estimated 24,000 jobs in October, with most of the decline in the non-educa-tional component of state govern-ment. Total sector employment is down 288,000 jobs so far this year. Employment in both state government and local government has been trending down for the

past three years as budget pres-sures have been intense.

More Details The average hourly wage for all employees on private nonfarm payrolls rose by five cents (up 0.2 percent) to $23.19 in October. The rise of 1.8 percent during the past 12 months pales versus the 3.9 percent rise in consumer prices over roughly the same time peri-od. The “underemployment rate” — that which includes the unem-ployed, those working part-time who would prefer to work full-time, and those discouraged work-ers who are not seeking a job but would accept one if offered to them — declined to 16.2 per-cent versus 16.5 percent the prior month.

From Here? Modest U.S. economic growth with modest job gains appears the most likely scenario at this point. However, develop-ments across Europe could blow that forecast out of the water. Whether or not the Congressional “super commit-tee” of six Democrats and six Republicans accomplishes any-thing of value also remains to be seen. Their report on how to slow government spending by $1.2 tril-lion over 10 years is due no later than Nov. 23. I would suggest that an announcement of a major plan to trim deficits by at least $3.5 tril-lion over 10 years could be worth 300-500 points on the upside for the Dow average. Conversely, an announcement that polarizing pol-

itics remains the status quo, with no agreement at all, could cost the Dow average a similar amount.

Jeff Thredgold is the only econo-mist in the world to have ever earned the CSP (Certified Speaking Professional) interna-tional designation, the highest earned designation in professional speaking. He is the author of econ-America, released by major pub-lisher Wiley & Sons, and serves as economic consultant to Zions Bank.

Jeff Thredgold

A mixed bag for jobs

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Socializing for Business

The Enterprise Nov. 14-20, 201112

• Nov. 15, 8:30-9:30 a.m.: “Are You Ready? Important Bankruptcy Changes Take Effect Dec. 1,” presented by the law firm of Snell & Wilmer. On December 1, amendments to Rules 3001 and 3002 of the Federal Rules of Bankruptcy Procedure – the rules that govern the preparation and filing of proofs of claim in bank-ruptcy cases – will take effect. New forms will accompany these changes. The rule changes will affect virtually every lender that has a claim against a debtor in a bankruptcy case, especially lenders who hold liens against collateral secured with the “debtor’s personal residence.” The new rules also cre-ate penalties for lenders who fail to comply, including a possible “award of other appropriate relief, including reasonable expenses and attorney’s fees caused by the failure.” Snell & Wilmer partner David Leta and other members of the firm’s bankruptcy group will speak. The program is designed for lenders who review, approve, prepare and file proofs of claim in bankruptcy cases. Location is the offices of Snell & Wilmer, 15

W. South Temple, Suite 1200, Salt Lake City. Free. Breakfast will be served. Register by Nov. 9 with Jennifer Nielsen at rsvp@swlaw.com or (801) 257-1994. • Nov. 15, noon-2 p.m.: “The Impact of Corporate Preparedness on the Bottom Line,” a webinar hosted by Agility Recovery Solutions and the U.S. Small Business Administration. Agility president and CEO Bob Boyd will review the far-reaching financial impact of having a plan in place to recover after a disas-ter. A question and answer session will follow the presentation. Free. Register at https://www1.gotomeet-ing.com/register/446675577. • Nov. 16, 8 a.m.-1 p.m.: Northern Utah Business & Economic Summit (NUBES,) hosted by the Davis Chamber of Commerce. This year’s theme is “Thriving in a Rebounding Economy” and will have various breakout sessions. Featured speak-er will be Utah Lt. Gov. Greg Bell. Location is the Davis campus of Weber State University, 2750 N. University Park Blvd., Layton. Cost is $59 for one ticket, $99 for

two. Register at www.davischam-berofcommerce.com/nubes. • Nov. 15, 7 p.m.: “Climate Capitalism: The Business Case for Sustainability,” presented by Westminster College and the Utah Council for Citizen Diplomacy. The lecture will be presented by L. Hunter Lovins with sustainabil-ity expert Dr. Boyd Cohen. They will tell the stories of inventors, major corporations, communities and Main Street businesses that are cutting their costs, driving innova-tion, inspiring their employees and building prosperity by investing in energy efficiency and renewable resources. Trained as a sociologist and lawyer, Lovins is also pro-fessor of business at Bainbridge Graduate Institute and the chief insurgent of the Madrone Project. Recipient of such honors as the Right Livelihood Award, Lindbergh Award, and Leadership in Business, she was named Time magazine 2000 Hero of the Planet and in 2009, and Newsweek dubbed her a “Green Business Icon.” Lovins has consult-ed for scores of industries and gov-ernments worldwide. Location is

the Vieve Gore Concert Hall in the Emma Eccles Jones Conservatory at Westminster College, 1840 S. 1300 E., Salt Lake City. Free. • Nov. 17, noon-1:30 p.m.: “The Eight Pillars of Financial Greatness,” presented by Bank of American Fork and author/finan-cial coach Brian Nelson Ford. Ford will discuss the best ways to get out of debt and start saving, the most common mistakes people make with their money and how they can be avoided, as well as the best ways to teach children about money using old school values. Location is the Riverton branch of Bank of American Fork, 2961. W. 12600 S. Free, and lunch will be provided. Register at www.bankaf.com/events. • Nov. 17, 1:30 p.m.: Utah Commercial Real Estate 2012 Pre-Legislative Session Joint Industry Luncheon, hosted by local chapter members from NAIOP, CCIM and ULI. NAIOP’s government affairs vice president will report on federal issues and legislation impacting commercial real estate, such as tax legislation

and policy, energy efficiency leg-islation and FASB lease account-ing changes. Location is the ninth floor of the Joseph Smith Memorial Building, 52 N. Main St., Salt Lake City. Cost is $30 for members of the hosting organizations, $50 for nonmembers. Register at http://bit.ly/CRELegisLuncheon. • Nov. 30-Dec. 1, 7:30 a.m.-12:30 p.m. both days: “Real Estate Investment Analysis,” an eight-hour CORE commercial real estate education course conducted by NAIOP. The course is designed to provide the technical skills neces-sary to analyze the financial fea-sibility of real estate investment opportunities. Valuation techniques such as direct capitalization and discounted cash flow analysis are introduced first, followed by an examination of debt financ-ing’s impact on real estate invest-ments. Location is the Spencer Fox Eccles Business Building, Room 110, at the University of Utah in Salt Lake City. Cost is $125 for NAIOP members, $150 for non-members. Register at http://bit.ly/NAIOP8HrsCoreCE.

• Calendar •

The EnterpriseNov. 14-20, 2011 13

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Winery, on Nov. 15 from 6 to 7 p.m. The new program kicks off with four tastings of hand-picked Italian wines, paired with small plates created by executive chef Nathan Powers. The cost for the small plates pairing menu includes $5 for bites and $15 for wine pairing selections, per person. Reservations are needed and can be made by calling (801) 363-5454 or by visiting http://www.bambara-slc.com.

RETAIL • CityDeals and Volunteers of America, Utah’s Center for Women and Children, have partnered to help “Give Happy Holidays” this season by raising $60,000 by Dec. 31, 2011. The financial contribu-tions to the center will assist Utah women working toward the first steps of living a clean and sober life. CityDeals has established a donation page on its website on behalf of the Utah chapter at www.citydeals.com/volunteers-of-america. Contributions will be collected from CityDeals users in denominations as little as $1 up to $300. • Products created by Salt Lake City-based Yölka Chocolates, launched with finan-cial assistance from the Utah Microenterprise Loan Fund, are among Oprah Winfrey’s “favor-ite things” in the latest edition of O magazine. The local firm

products Russian spherical folk-art themed chocolate ornaments designed to be hung on Christmas trees. • Park City-based Back-country.com, an e-tailer of spe-cialty outdoor gear, has named C.J. Singh chief technology offi-cer. Singh has more than 10 years of experience working and lead-ing technology companies such as Synacor, Yahoo! and Oracle, specializing in team management building, software engineering and sophisticated technology solu-tions. • Joffee’s Coffees, a Canadian private-label roast-ing company, has partnered with Smith’s Food and Drug to retail coffee to benefit Utah Food Bank. Each bag of coffee sold generates a donation that would allow Utah Food Bank to buy a half gal-lon of milk, a dozen eggs and a loaf of bread. Joffee’s Coffees roasts created exclusively for Utah Food Bank – Hunger’s End Blend (dark), Do-Gooder Decaf (decaf), Grounds For Hope (medium) and Café Kindness (light) – will be available for purchase at all Utah Smith’s locations.

SCIENCE • An interdisciplinary team of Utah and Wyoming researchers has received a $6 million, three-year award from the National Science Foundation to develop a better understanding

of the interconnectivity of natu-ral and human water resources systems – a critical environmen-tal sustainability problem facing both Western states. The award will allow the team of research-ers to develop high-performance computer modeling and computa-tional resources (known as cyber-infrastructure or CI) to simulate and study how factors such as population growth, shifting land uses and climate variability will impact water storage and avail-ability in the Intermountain West. The CI-WATER project includes researchers from Brigham Young University, the University of Utah, Utah State University and the University of Wyoming. BYU and the University of Wyoming are the lead institutions for their respec-tive states in the consortium. SPORTS • The International Mountain Biking Association (IMBA) has designated Park City as the first Gold Ride Center, its highest designation. IMBA is the organization that designates trails like Park City’s Mid-Mountain Trail as one of the world’s “Epic” rides, and the Ride Center program offers the equivalent endorsement on a much broader scale. IMBA ranks locations for possible Ride Center status based on a range of criteria, including the number of miles of various types of trails to the types and quantities of lodging

and restaurants in the area. • Snowbird collected thou-sands of cans of food and many hygiene items for the Utah Food Bank during the resort’s annu-al Customer Appreciation Days. The donation was presented to the Utah Food Bank on Nov. 9 at 10 a.m., and media are invited to the delivery. In addition, a finan-cial contribution was raised for Wasatch Adaptive Sports. TRAVEL/TOURISM • The Utah Valley Convention and Visitors Bureau announced its 2011–2012 holiday promotions. This year marks the fourth year the UVCVB has offered the Shop, Dine, & Stay and the second year for the Ski, Dine, & Stay due to popularity among numerous out-of-town visitors. Utah Valley houses three shopping centers within 10 minutes’ driving distance of each other. Provo Towne Centre, University Mall and The Shops at Riverwoods offer 350 retailers and local boutiques within 2.5 million square feet of shopping opportunities. The UVCVB’s Shop, Dine, & Stay promotion, lasting from Nov.1-Dec. 31, offers visitors special deals on lodging, dining and shopping. Visitors can also take advantage of the UVCVB’s Ski, Dine, & Stay promotion at Sundance Resort from Jan. 1–Feb. 29.

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The Enterprise Nov. 14-20, 201114

Americans listen when Michael Bloomberg speaks, not only because he is the mayor of New York City, but because he is a self-made billionaire and a smart guy. People think Bloomberg knows a lot about business and investment, which he sure-ly does. But he neverthe-less sounds terribly misin-formed sometimes, as he did the other day when he complained that “Occupy Wall Street” is unfairly blaming the nation’s big bankers for the crash and recession, when the real culprits are Congress and the government-sponsored housing lenders, Fannie Mae and Freddie Mac. “It was not the banks that created the mortgage crisis,” said the mayor. “It was, plain and simple, Congress, who forced everybody to go and give mort-gages to people who were on the

cusp. ... But they were the ones who pushed Fannie and Freddie to make a bunch of loans that were imprudent, if you will. They were the ones that pushed the banks to loan to everybody.” It was Bloomberg’s mis-

fortune to blurt those remarks a day before the U.S. attorney in Manhattan, whose offices are only blocks away from City Hall, announced that the Justice Department is suing Allied Home Mortgage Corp. for perpetrating a gigantic, decade-long fraud, in

violation of federal regulations and statutes, that cost the gov-ernment at least a billion dollars and forced thousands of American families out of their homes. Indeed, if the mayor only read the fine news service that carries his name, he would know

that such massive frauds in the pri-vate sector were behind the finan-cial crisis — and that his friends on Wall Street made billions by “securitizing” those bad loans — and then brought down the world economy when their game could no longer be sustained. Nobody in Congress and nobody at Fannie or Freddie forced them to do that. The most authoritative studies, notably the final report of the Financial Crisis Inquiry Commission — which examined many other academic and think-tank works — have demonstrated that whatever their other prob-lems, Fannie and Freddie were not the most significant contributors to the subprime disaster. More than 84 percent of the subprime mortgages in 2006, for instance, were issued by private lending institutions, including 82 percent of the subprime loans to low- and moderate-income borrowers.

Nor were Fan and Fred — or Congress, for that matter — cul-pable in the enormous crime wave of mortgage fraud that engulfed states like Florida, Arizona and California, which would keep a special prosecutor busy for the next five years if only somebody appointed one. Bloomberg may also have meant to allude to the Community Reinvestment Act, an even more favored target of Republicans (since many of them have partaken of Fannie and Freddie’s largesse, just like their Democratic brethren in Washington). But again, there is simply no evidence that CRA played a major role in the mort-gage meltdown — or the slicing and dicing of mortgage deriva-tives that spread the contagion to every major bank here and many across the world. Nothing in the act, designed to encourage lending in poor com-

munities, required the excessively leveraged, insufficiently overseen “creative financing” that caused the crisis. The institutions that originated the great majority of the riskiest mortgages, as economist Robert Gordon showed conclu-sively, weren’t even covered by CRA. So much for the mayor’s cheap shot against the “Occupy” protesters, whose encampment in lower Manhattan he considers inconvenient. He may want them to leave; he may eventually force them to leave. But their message — that Wall Street’s perpetrators of the crisis have escaped account-ability and profited obscenely, instead — is undeniable no matter what he says or does.

Joe Conason is the editor in chief of NationalMemo.com.

Copyright 2001Creators.com.

Bloomberg vs. Occupy Wall Street

Joe Conason

Nov. 14-20, 2011 15The Enterprise

One of the things that has struck me, when I have gone on luxury cruise ships, is that most of the passengers look like they are older than the captain — and luxury cruise ships don’t have juveniles as captains. The reason for the elderly clientele is fairly simple: Most people don’t reach the point when they can afford to travel on lux-ury cruise ships until they have worked their way up the income ladder over a long period of years. The relationship between age and income is not hard to understand. It usually takes years to acquire the skills and experience that high-paying jobs require, or to build up a cli-entele for those in business or the professions. But those in the media and in politics who are currently up in arms, denouncing income inequal-ities, seldom mention age as a fac-tor in those inequalities. The shrill rhetoric about dif-

ferences in income proceeds as if they are talking about income inequalities between different classes of people. It would be hard to get the public all worked up over the fact that young people just starting out in their careers

are not making nearly as much money as their parents or grandparents make. Differences in wealth between the young and the old are even great-er than differences in income. Households

headed by someone 65 years old and older have

more than 15 times as much wealth as households headed by someone under 35 years of age. But these are not different classes of people, as so often insinuated in runaway political rhetoric. Everybody who is 65 years old was once under 35 years of age. And most people under 35 years of age will someday be 65 years old. Differences in age are just

one of the reasons why the insinu-ations about income and wealth that are thrown around in the media and in politics are often remote from reality. While the rhetoric is about people, the statistics are almost invariably about abstract income brackets. It is easier and cheaper to collect statistics about income brackets than it is to follow actual flesh and blood people as they move massively from one income bracket to another over the years. More important, statistical studies that follow particular indi-viduals over the years often reach diametrically opposite conclusions from the conclusions reached by statistical studies that follow income brackets over the years. Currently we are hearing a lot in the media and in politics about the “top 1 percent” of income earners who are supposedly get-ting an ever-increasing share of the nation’s income. That is absolutely true if you are talking about income brackets.

It is totally untrue if you are talk-ing about actual flesh and blood people. The Internal Revenue Service can follow individual people over the years because they can iden-tify individuals from their Social Security numbers. During recent years, when “the top one percent” as an income category has been getting a growing share of the nation’s income, IRS data show that actual flesh and blood people who were in the top 1 percent in 1996 had their incomes go down — repeat, DOWN — by a whop-ping 26 percent by 2005. How can both sets of sta-tistics be true at the same time? Because most people who are in the top one percent in a given year do not stay in that bracket over the years. If we are being serious — as distinguished from being politi-cal — then our concern should be with what is happening to actual flesh and blood human beings, not what is happening to abstract income brackets.

There is the same statistical problem when talking about “the poor” as there is when talking about “the rich.” A University of Michigan study showed that most of the working people who were in the bottom 20 percent of income earn-ers in 1975 were also in the top 40 percent at some point by 1991. Only 5 percent of those in the bottom quintile in 1975 were still there in 1991, while 29 percent of them were now in the top quin-tile. People in the media and in politics choose statistics that seem to prove what they want to prove. But the rest of us should become aware of what games are being played with numbers.

Thomas Sowell is a senior fellow at the Hoover Institution, Stanford University, Stanford, CA 94305.

Copyright 2011Creators.com

Numbers games

Thomas Sowell

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