JANUARY/FEBRUARY 2021
Soaring growth for local health company
Seeking Health aims to achieve $50 million in annual revenue by 2023 Seeking Health Founder and Owner Dr. Ben Lynch and CEO Adam Rustad
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Interfaith Coalition’s county-wide impact on our community Hardware Sales embraces online success What to expect from a Biden administration and its tax proposals Looming unemployment insurance crisis could include 500% tax increase Business Pulse magazine 2423 E Bakerview Road Bellingham, WA 98226
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VOL. 46 | NO. 1
PUBLISHER Whatcom Business Alliance EDITOR Matthew Anderson CONTRIBUTING Cheryl Stritzel McCarthy WRITERS Mike McKenzie Dustin McKissen GUEST Sean Kanaley COLUMNISTS Kris Johnson Andrea Monroe Kamyar Monsef Jeannett Penner Patti Rowlson Laurie Trautman Michelle Walker ART DIRECTOR Whitney Pearce PHOTOGRAPHY Tiffany Brooks CUSTOMER SERVICE Ashley Butenschoen ADMINISTRATION Danielle Larson Cover Photo by Tiffany Brooks
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WBA BOARD OF DIRECTORS:
BOARD CHAIR: John Huntley, President/CEO, Mills Electric Inc. EXECUTIVE COMMITTEE: Pam Brady, Director NW Gov’t & Public Affairs, BP Cherry Point; John Huntley, President/CEO, Mills Electric Inc.; Doug Thomas, President/CEO, Bellingham Cold Storage; Josh Turrell, Partner, Larson Gross PLLC; Josh Wright, VP/Broker, Bell-Anderson Insurance BOARD OF DIRECTORS: Tyler Byrd, CEO, Red Rokk Interactive; Jane Carten, President, Saturna Capital; Andy Enfield, Vice President, Enfield Farms; Bryant Engebretson, Managing Principal, Tradewinds Capital; Jon Ensch, Commercial Banking Officer, Peoples Bank; Mitch Faber, Partner, Adelstein Sharpe & Serka; Sandy Keathley, Former Owner, K & K Industries; Tony Larson, Founder, Whatcom Business Alliance & President, Barleans/Board Member Emeritus; Laura McKinney, NW Gov’t Affairs & Public Relations, Alcoa-Intalco Works; Nicole Newton, Semiahmoo Resort/Golf/Spa; Becky Raney, Former Owner, Print & Copy Factory; Sarah Rothenbuhler, Owner/CEO, Birch Equipment; Patti Rowlson, Founder/Marketing Director, PR Consulting Inc.; Galen Smith, Operations Manager/ Owner, Coldstream Farms; Billy VanZanten, CEO, Western Refinery Services For editorial comments and suggestions, write editor@businesspulse.com. The magazine is published bimonthly at 2423 E. Bakerview Rd., Bellingham WA 98226. 360.746.0418. The yearly subscription rate is $25 (US). For a digital subscription, visit businesspulse.com. Entire contents copyrighted ©2021 Business Pulse. All rights reserved. POSTMASTER: Send address changes to Business Pulse, 2423 E. Bakerview Rd., Bellingham WA 98226
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IN THIS ISSUE 11
INTERFAITH’S ACTIONS FELT THROUGHOUT THE COUNTY Celebrating 40 years of service, 1,499 volunteers and a new executive director leading the way.
19 SEEKING HEALTH SEES ZOOMING GROWTH
The company’s performance was remarkable even before COVID-19.
25 HARDWARE SALES THRIVES ON SOFTWARE SALES The local landmark business stands tall in the big-box era.
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29 HOW ARE GYMS SURVIVING?
Two local gym owners speak on fiscal fitness during COVID-19.
32 PERSONALLY SPEAKING
We talk with Rob Washburn of Windermere Real Estate about doing business in a seller’s (and buyer’s) market.
34 WHAT TO EXPECT FROM A BIDEN ADMINISTRATION’S TAX PROPOSALS
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Look for additional content online at businesspulse.com
A lot could depend on who has control of the Senate.
COLUMNS 45 The enduring value of community banks — return to a prepandemic border seems 47 Legislature must unlikely act quickly to head off looming 41 Intern, part-time umemployment employee or contract insurance crisis marketer? 39 Border expectations
43 How to wake up from lockdown inactivity
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BP UP FRONT
Time to bid 2020 farewell as we navigate a changing business landscape Tony Larson and Barbara Chase
Happy New Year, all. I’m thinking most everyone reading this column is glad to bid 2020 farewell and is looking forward to shaping opportunities and navigating through the lingering uncertainty and likely changing business and political landscape in 2021. This will be the last publisher’s note that I write for Business Pulse magazine, which has been published in Whatcom County since 1975. Future issues will be published by the Whatcom Business Alliance under the watchful eye of our outstanding new executive director, Barbara Chase. If you haven’t met Barb yet, I hope 2021 is the year we can change that, either in person or through Zoom. Her role is vital, as the WBA continues to be the eyes, ears and voice for the Whatcom County business community. Business Pulse magazine will be more important than ever as the only local advocate for issues that improve the economic and social vitality of our community. As founder of the WBA and publisher of Business Pulse magazine for the past 31 years, I am committed to continuing advocacy for local business and facilitating community prosperity as a member of the WBA board of directors and a Presidents Club member in my new role in the local private sector. Please consider this opening a warm introduction to Barbara Chase, who has been with the WBA since March and has been leading it since June. Our support of Barbara, the WBA and Business Pulse is
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critical as we continue to engage and contribute to the values and conversations that will maintain the quality of life we’ve all been blessed with here in Whatcom County. Barbara and I teamed up to co-write the message below as we enter what we expect to be a great transition year for all of us. Enjoy the issue.
Tony Larson WBA founder and former Business Pulse publisher
We hope that over the coming year local leaders with a variety of opinions and political positions will come together to recognize the important role we all play in creating a prosperous community.
If it appears we’ve begun every recent issue by addressing the ongoing coronavirus pandemic and economic restrictions, it’s because we have. The past nine months have seen the most significant health and economic crisis Whatcom County has faced in decades. As of this writing, Gov. Jay Inslee has reinstituted many of the economic restrictions he put in place just after COVID-19 first arrived a year ago. The pandemic and the governor’s restrictions have had devastating impacts on the local economy and on the families that depend on our county’s small businesses. However, there is hope on the horizon. Vaccinations began in December, and experts predict that health and economic normalcy will begin to return by late spring or early summer. While that is good news, Whatcom County and the state of Washington need to reassess their perspective on the relationship between the business community and public health. If, as most experts predict, pandemics become more common, we must do a better job of containing a disease without destroying the livelihoods of millions of people. Doing that will require the business community to present a strong, unified voice that conveys the important relationship between a robust economy and positive public health outcomes. While Whatcom County is still reeling from the pandemic, throughout this issue we profile several bright spots in
the local economy. Regular contributor Cheryl Stritzel McCarthy begins by profiling the important work of the Whatcom Interfaith Coalition and its executive director, Deanna Wildermuth. Dustin McKissen writes about Whatcom County’s still-booming residential real estate market — which is hotter than ever for reasons that raise policy concerns. We also take a look at local companies Seeking Health and Hardware Sales and their successes before and during the pandemic. We are confident that by this fall, we will fill these pages with stories of companies and leaders helping our community blaze a trail back to prosperity. Since Business Pulse was first published in 1975, this corner of Northwest Washington has suffered many setbacks and challenges. But in the end, we remain one of the most desirable places in the world to call home. Our county has visionary thinkers, hard workers, talented leaders and diverse innovators capable of rebuilding this economy and creating opportunity for all of Whatcom County. The past year and the stories in this issue of Business Pulse are a testament to an important fact: The private sector and for-profit businesses are our friend, not our enemy. Small businesses, midsize companies and large corporations are essential to the health of this community. Try as it might, government cannot sustainably replace the role business plays in putting food on our tables and roofs over our heads. We seem to have forgotten that there are huge portions of the workforce who cannot do their jobs online and cannot adequately replace their incomes with unemployment benefits. Lessons learned from the pandemic are not worth the cost paid. Pretending there is a bright side is insulting to the people who have lost their lives and/or livelihoods. However, we hope that over the coming year, local leaders with a variety of opinions and political positions will come together to recognize the important role we all play in creating a prosperous community.
Finally, we want to express our sincere thanks to the readers, advertisers, team members and contributors who continue to making this magazine possible. Local media are critical. We will continue to tell stories and provide information about local issues, trends and challenges, and we will keep lifting up with encouragement from our Whatcom County businesses, nonprofits and people. We look forward to adding you to the growing numbers of businesses connect-
ed by an interest in improving Whatcom County. As a WBA member, you’ll become part of a leadership group committed to making a difference. Please reach out if you’d like to learn more. Thank you. Wishing you a happy, healthy and prosperous 2021 and beyond,
Tony Larson & Barbara Chase
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BP NEWSMAKERS
Patrick Harrington
Merrill Bevan
Barron Heating promotes 3 to executive support team Barron Heating AC Electrical & Plumbing recently promoted three team members to its executive support team. After several years in the accounting department, Patrick Harrington is now Barron’s chief financial officer. Harrington has nearly two decades of management and corporate accounting experience. Merrill Bevan, who joined the company this past year as sales manager, is Barron’s new director of sales and marketing. Bevan, a Whatcom County native, joined Barron with more than 20 years of experience in equipment sales and management. Former Air Solutions manager Michael Takemura is now Barron’s director of business development. With a strong background in science and business, Takemura has been instrumental in the continuing development of the company’s Air Solutions and Solar by Barron divisions. These new members of Barron’s executive support team join COO Brad Barron; Raksha Rughani, the company’s human resources manager, who has been at Barron for more than 20 years; Linda Nordstrom, administrative supervisor; and Debbie Gwaltney, executive assistant and customer experience manager. With these personnel promotions in place, owner and CEO John Barron said he feels confident about the future of the company his father founded in 1972.
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Michael Takemura
Brendan Pape
“I work with the best people in the world, and sometimes I just have to pinch myself when I come to work,” Barron said. “I see everybody rally together and accomplish things that improve the lives of the customers we serve across five counties.” Committed to improving lives through its Air Solutions team and certified home performance experts, Barron provides a wide range of heating, cooling, solar, electrical, plumbing and indoor air quality products and services. The company also has a large selection of stoves, fireplaces and hot tubs in its Firelight by Barron showrooms. Barron Heating AC Electrical & Plumbing has become one of Northwest Washington’s largest home performance experts, with locations in Ferndale, Burlington and Marysville. Approximately 150 employees serve customers in Whatcom, Skagit, Island, San Juan and Snohomish counties. For information, visit https://www.barronheating.com.
Brist Mfg. earns Inc. 5000 ranking among fastestgrowing companies Brist Mfg., a Bellingham producer of quality custom merchandise for diverse brands, earned a place on the prestigious Inc. 5000 list of the fastest-growing private companies in America in 2020. With a three-year revenue growth rate of 195%, Brist Mfg. was the topranked Whatcom County company on the Inc. 5000 list. It was 45th among the 100 Washington state companies
Elliot Kuida
Tom Borthwick
on the list and No. 2,164 nationwide. A minimum of $2 million in annual revenue is required to qualify for the Inc. 5000. “It’s an absolute honor to be recognized and ranked by Inc. magazine as one of America’s fastest-growing companies,” said Brendan Pape, CEO of Brist Mfg. “We’ve been working since 2015 to empower brands with the creative tools, sourcing channels and fine-tuned manufacturing to make and distribute brand-elevating custom products that their loyalists will love.” Brist provides customers with design resources, warehousing and fulfillment, e-commerce management, and full private-label manufacturing. Its product range includes custom T-shirts, flannel shirts, masks, gaiters, hats, beanies, bike jerseys and patches, among other items. For more information, visit https://www.bristmfg.com.
PeaceHealth names new chief operating officer Elliot Kuida, MPH, will join PeaceHealth’s Northwest network leadership team as chief operating officer (COO) on Monday, Dec. 21, 2020. As COO, Elliot will initially focus his work on PeaceHealth St. Joseph Medical Center and expand his role over time to meet the evolving needs of PeaceHealth’s larger Northwest network. “Elliot is an accomplished senior executive who has worked in a variety of healthcare settings across the country,” said Charles Prosper, PeaceHealth Northwest network chief executive. “He brings a wealth of skills and experienc-
NEWSMAKERS BP
es to PeaceHealth.” Elliot most recently served as executive vice president and chief operating officer of Blessing Hospital, a 327-bed non-profit regional medical center in Quincy, Illinois. Prior to his work with Blessing Health System, Elliot was vice president and chief operating officer of Sentara Martha Jefferson Hospital in Charlottesville, Virginia. He previously held wide-ranging healthcare leadership positions in Virginia and California. “I’ve been fortunate to work in many excellent community non-profit health systems, and PeaceHealth definitely continues this tradition for me,” Elliot said. “From my very first interaction with PeaceHealth and throughout each step along the way, it has been very evident that it is an organization whose Mission, Vision and Values are alive and well. I am honored to be a part of it.”
After receiving his Bachelor of Science degree in community health from the University of Utah, Elliot received a master’s in public health from the University of California, Los Angeles.
Borthwick Jewelry of Ferndale doubles in size With an expansion that enables much more jewelry to be displayed, Borthwick Jewelry of Ferndale has doubled in size. Owner Tom Borthwick said Borthwick Jewelry was able to add the space next to it, giving the store 2,000 square feet. “The added space also will provide more privacy for customers as they consider jewelry that will mean the most for themselves or their loved ones,” Borthwick said. Borthwick Jewelry, founded in 1997, offers loose diamonds, bridal sets,
anniversary bands, sterling silver, gemstone rings and gemstone pendants. It also handles most repairs at the store, reducing turnaround time for their customers, Borthwick said. Despite the COVID-19 pandemic that forced the store to close for more than two months, Borthwick Jewelry’s sales are 10% higher this year compared to 2019, contributing to the decision to expand. “During a time when many of our usual activities are restricted, jewelry has become even more appreciated,” Borthwick said. Borthwick has more than 30 years of experience in retail jewelry. He opened his store in downtown Ferndale in 1997, then moved it to the current location in 2004. For more information, visit https://www.borthwickjewelry.com.
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BUSINESS PROFILE BP
PHOTO: Tiffany Brooks
Interfaith’s actions felt throughout Whatcom County Now in its 40th year, local nonprofit’s impact is significant Cheryl Stritzel McCarthy Locally, 1,499 people volunteer with the nonprofit Interfaith Coalition of Whatcom County. If they were employees, that would make Interfaith the fourth-largest employer in Whatcom County, according to 2019 data from the Center for Economic and Business Research at Western Washington University. Since its beginning in 1981, the homegrown nonprofit has become a force. Now, in its 40th anniversary year, Interfaith includes 55 churches, a synagogue and other local partners working together to end family homelessness and poverty in Whatcom County. The breadth of its current outreach means that Interfaith’s actions are seen and felt throughout Whatcom County. When Laura Harker joined Interfaith in 1992 as one of its first paid employees, the organization had fewer than half of its current number of congregations and fewer than
a hundred volunteers. The nonprofit was just over a decade old that year. It offered affordable medical care and supported other nonprofits’ programs but had no housing of its own. Today, it has 14 housing units throughout the county to shelter families as they work toward self-sufficiency. Interfaith sheltered an additional 13 families in 2020 using existing church buildings. Harker retired at the end of 2020 after 28 years as executive director. Deanna Wildermuth (see sidebar on page 14) is stepping into that role. This milestone transition offers a good time to look at the nonprofit’s evolution from a small band of volunteers to an impactful force in Whatcom County. Becoming givers One way to gauge Interfaith’s impact is to hear from
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those whose lives have been Harker.) Case management changed. was an important part of the Yesenia and Eduardo Puhousing program from the lido and their children had a beginning; today case manstable life in San Diego for agers continue to work with 18 years until the restaurant families on goals that lead to where Eduardo worked was self-sufficiency. sold. Promised work in the What Interfaith does Northwest, they moved to Interfaith today has seven Whatcom County. Eduardo programs. went to work but was never Family Housing is its pripaid by his employer. The sitYesenia and Eduardo Pulido, owners of Infusion Restaurant mary one. This is the only uation grew bleak, with the in Lynden. emergency housing in Whatfamily of five living in one com County (other than mogations who put aside differences to small room. But once in Interfaith housing, the family was able to focus on responding to human need tels) that keeps all types of families change course. Now, as owners of In- and a desire to serve our neighbors,” together, including families with adfusion Restaurant in Lynden, the Pu- Harker said. “A motto is: though we olescent sons (boys older than 12 are lidos are financial donors to Interfaith. may not believe alike, can we not love not allowed in women’s and children’s group shelters). Joel and Bethany Kennedy, mar- alike?” Families moved into Interfaith’s first “We connect folks who want to ried for 24 years with eight children, had been longtime tenants in a rent- donate or volunteer with folks need- four-unit apartment building in 1995. al home when the owner had to sell. ing help,” Harker added. “Interfaith is The number of housing units grew They found another rental, but when truly neighbor helping neighbor. My over the years, and in 2019, Interthe rent ballooned beyond affordabil- work has never been a ‘job,’ but a vo- faith’s first-ever private donor, Susan ity, they were evicted. For months, the cation in the truest sense. Never have McClendon, contributed the use of a family slept in tents and vehicles while I felt so much a part of a real coalition. house, bringing the current number to 14. looking for a place to live. Moving Together, we accomplish so much.” That number will soon grow again. In Harker’s early years with Interinto an Interfaith home for a year is allowing the family to rebuild their faith, the nonprofit was focusing on Interfaith received its biggest single lives. “This has allowed us to begin affordable health care for low-income donation in its history when longtime giving back to the community, even people, through the Interfaith Com- volunteer Noriko Lao donated her as we continue to stabilize,” Bethany munity Health Center. The need for Bellingham home in May 2020 as she that service — more than 19,000 pa- moved into a retirement community Kennedy said. Jessica (name has been changed) tient visits in the year 2000 — neces- (she is now deceased). Interfaith’s Family Promise of and her 6-year-old son were flee- sitated a move in 2001 to its current ing domestic violence. When Jessica Unity Street location. In 2015, the Whatcom County brings congregafound she and her son could live for health care program separated from tions and other sites together to feed a year in a little Interfaith house in an Interfaith and became the indepen- and temporarily house more homeless families. It’s part of an effort that appealing Bellingham neighborhood, dent Unity Care NW. Interfaith had started its embry- began in New Jersey in 1986 and she cried with relief. Her goals, she said, are to “have a great job and take onic housing program in 1994 when has grown to 200 affiliates across the care of my family. I never want to rely construction began on a four-unit country. Interfaith launched Famiapartment building in Bellingham, to ly Promise of Whatcom County in on someone else.” In her nearly three decades with In- provide housing for families as they April 2018. Before COVID-19, up to terfaith, Harker has been part of the transition to long-term housing. (In- four families at a time were fed and solution to countless stories like these. terfaith recently named that 26-year- sheltered overnight in a local church “We bring together diverse congre- old fourplex Laura’s Place, in honor of building, rotating to a new site every
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week. Volunteers provided breakfasts and dinners, plus conversation, homework help and playtime for youngsters in the evenings. The CAST program serves a (socially distanced, outdoors) simple meal of sandwiches, fruit and drinks to anyone in need three evenings a week at the Arch of Reconciliation behind the library in downtown Bellingham. About 130 volunteers participate on a rotating basis, purchasing supplies, making sandwiches, transporting and serving. In 2020, CAST served 3,300 meals. Kids Need Books, created by donor and volunteer Joe Nolting, distributes donated books free to children in need at food banks, migrant worker camps and other sites. A retired teacher, Nolting and other Interfaith volunteers distributed 19,284 books in 2020. They have given out 108,224
books since Nolting launched the program in 2016. The Winter Coat Drive occurs in October, with more than 3,000 coats collected and distributed at sites in Bellingham, Ferndale, Blaine and Deming. Project Warm Up involves volunteers who knit 1,200 hats, scarves, baby blankets and mittens to distribute. Holiday Gifts connects families in need with gifts purchased by businesses and congregations. Transforming volunteers “Interfaith makes a personal connection between volunteers and our neighbors needing assistance,” Harker said. “Our goal is to transform the volunteers as well as folks we serve. Years ago, Interfaith operated severe weather shelters, and I heard over and over about the connections volunteers made with shelter guests. Volunteers
working overnight shifts would stay up all night, many times enjoying visiting with guests. “We also had guests that become volunteers. This happens with CAST and Family Promise as well. This makes Interfaith unique — we bring our entire community together and break down misconceptions about folks experiencing poverty. “This theme, as well as the theme of Interfaith’s programs evolving through the years to meet the greatest needs, has been with us throughout our 40year history.” The decision to retire is bittersweet, Harker said, though she is looking forward to becoming an Interfaith volunteer. Her joining those ranks will bring the number of volunteers neatly to 1,500 as Interfaith’s 40th anniversary year begins.
PHOTO: iStockphoto.com/SvetaZi
Seeking new location
Interfaith Coalition, a local nonprofit that works to get families out of poverty and into homes, is seeking a new home itself — one that’s 6,000 to 8,000 square feet and within walking distance of bus stops. Interfaith has nine employees, five of those part-time, but manages 1,499 volunteers and seven programs. Currently, its staff members are in two locations on opposite sides of town. “It’s way too much time lost in transit for meetings and
inefficient for communication among staff,” said Barbara Mathers-Schmidt, chair of Interfaith’s property acquisition committee. “We need those people in one building. This kind of work involves challenging and complex conversations, and that is best handled in person.” The building would include some emergency housing for families served by Interfaith’s Family Promise program, meeting spaces for families and service providers, and space for workshops open to the community.
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In person with Deanna Wildermuth Cheryl Stritzel McCarthy
Deanna Wildermuth becomes the executive director of Interfaith Coalition of Whatcom County at a pivotal moment of growth and change for the local nonprofit. Wildermuth, who served for 23 years as a pastor for congregations throughout the country, moved from Seattle to Bellingham to take the job. How does Interfaith impact Whatcom County business? The work we do influences the situation for business. We empower families to get out of poverty and into housing. We don’t want to be a community that thinks homelessness is OK. Interfaith is 55 congregations and other local partners. Our volunteers — there are so many of them! — reach into all the communities throughout Whatcom County. Businesses sponsor our annual auction coming up on April 10, 2021. See them on our website at https://www. interfaith-coalition.org/hope-auction. All these people see that businesses care. Also, when our properties need maintenance, we call local businesses first. What’s ahead for Interfaith? The work we do will continue to be needed, unfortunately. In January 2020, 4% of kids in Whatcom County schools were experiencing homeless-
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ness. That increased from 3.5% the year before. That includes kids who are couch surfing and families doubled up in a single housing unit. Based on that 4%, I’m thinking we’ll see an increase. The cost of housing here is prohibitive for so many households, particularly single parents. It’s really not OK when it’s kids. One of Interfaith’s strengths is case management. We equip families to be successful, to find permanent housing. The government’s system of case management is less robust than ours. We will continue to develop mentor relationships between our guests and our volunteers. If there’s someone to call when you need computer help or car repair … someone who’s not paid, just a neighbor helping if possible. We could provide a family that’s moving into permanent housing with a list of neighbors/volunteers who could help, say, with a clogged drain. By the first of this year, 2021, we’ll have established our learning center, where kids can connect with volunteer tutors or get computer support for online learning. Anyone in any sort of Interfaith housing could access that. It will be in our new Day Center, in First Christian Church in Bellingham. We want to have all our staff in one location. We currently have two locations as well as people working at home. Interfaith has been looking for property, for a building we can renovate. This
PHOTO: Tiffany Brooks
building would provide emergency housing for no fewer than five families; each would have a separate space within the building. We think the need will increase; will we have the capacity to offer emergency shelter? This new location would have common spaces plus private spaces for case management. I’d love to have a public space with a different entrance, large enough for 30 people, to do programs for the community at large — financial literacy, homeowner classes, parenting — what we’re doing already but for the community at large. On my dream list, down the road, I’d like space at this location for a childcare center that would be free to Interfaith families — a licensed, high-quality program. We’re prepared to fully fund the director and program, with additional staffing by volunteers. This would promote better long-term outcomes for a vulnerable population. What about Interfaith most appeals to you? Our diverse roots. We are congregations, volunteers, professional folks, the community at large, all pulling in the same direction. Every world religion has some iteration of “love your neighbor.” At our best, we care for one another. If I can be part of a community of humans that does that, that makes a difference, I want to do that. Interview has been edited.
REAL ESTATE OP-ED BP
PHOTO: Tiffany Brooks
Residential real estate still an economic strength Better city, county policies could help even more Dustin McKissen Farming, tourism, the arts, the Cherry Point Industrial Zone and nearly every other pillar of the Whatcom County economy has suffered a grueling year. However, two industries have thrived: toilet paper and residential real estate. The demand for toilet paper is a little hard to explain. The demand for homes in Whatcom County is not. The pandemic and resulting stay-at-home orders freed thousands of white-collar and tech workers to live wherever they wanted to. Since last March, many of those Seattle, Portland and California workers have chosen Whatcom County. The effect on prices and inventory has been dramatic. “In the real estate business, this year has been like no other,” said Mike Kent of Windermere Real Estate and Mike Kent Real Estate Sales & Marketing. “This has been
the most unpredictable year in the 22 years I’ve been in the business. Initially, most experts thought COVID-19 would crush the residential real estate market, and we saw an initial freeze in the first 30 days of the pandemic. However, after those 30 days ended, we immediately began seeing buyers gravitate to Whatcom County. While our housing costs are at historical highs, we are still a far more affordable market than Seattle, Portland and San Francisco.” Perry Eskridge, executive officer and government affairs director at the Whatcom County Association of Realtors, also emphasized the impact of out-of-area and out-of-state buyers. “The regionalization of the West Coast real estate market has become a driving force in Whatcom County,” Eskridge
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“Right now, we have about three weeks of housing inventory. … A healthy market should have about six months of inventory.” Mike Kent, Windermere Real Estate and Mike Kent Real Estate Sales & Marketing PHOTO: Tiffany Brooks
said. “Buyers traveling from Everett and Seattle to look at houses in Ferndale is now the norm. Further, we know Whatcom County has become a desired destination for California- and Seattle-area tech workers who are unlikely to return to the office once the pandemic is over.” Skyrocketing housing prices are not just the result of additional demand. Whatcom County has always been a desirable place to live. Prices have reached record highs because housing inventory is also historically low. “Right now, we have about three weeks of housing inventory,” Kent said in early December. “That means that if no new properties entered the market, we would sell all the listed properties in three weeks. A healthy market should have about six months of inventory. A limited amount of supply coupled with enormous demand will always send prices higher. It is Economics 101.” The problem is most acute in the City of Bellingham, where Eskridge estimated that as of early December there were roughly 40 houses available listed at less than a million dollars. In the third quarter of 2020, the average house price in the City of Bellingham was $642,260, up 17.1%
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from the same quarter in 2019, before the pandemic. While the conversation around housing and public policy often focuses on the homeless, the city’s notoriously flawed planning process has priced out much of Bellingham’s workforce, including teachers, first responders and other essential employees. In a deep irony, a city with an approach to governing that prioritizes inclusiveness has maintained policies that have made the city progressive and exclusive — and progressively exclusive. As housing stock dwindles and prices climb higher and higher, the city has made home ownership a nearly impossible dream for much of its own community. “The median home price in Whatcom County and in Bellingham are both out of reach for the average household income in those communities,” Kent said. “If you’re a kid who grew up in Whatcom County and are now a young buyer who wants to stay close to family, it is harder and harder to find a home you can afford. This county’s market is a challenge for first-time buyers.” While the county and the city have made homelessness a priority, a lack of workforce housing is almost im-
possible to solve without building more homes. As of this writing, there were 248 homes available in all of Whatcom County. There were 448 homes on contract. As long as demand outpaces supply, prices will continue to move up. The shift to remote work will, in many cases, remain permanent — and Whatcom County prices have a long way to go before they are comparable to California, or even Seattle and Portland. “It isn’t just price,” said Eskridge. “The quality of life in Whatcom County is exceptionally high, and many buyers are leaving some of the other challenges and uncertainties they experience in the larger metro areas on the West Coast for our slower pace and relative calm.” Every local real estate expert and economic leader interviewed for this article predicted demand for Whatcom County’s minimal housing stock will continue for the foreseeable future. Low housing availability could have the potential to unite real estate professionals and progressive groups and voices that have significant influence in the county. “As a member of this community, it is important to me that the firefighters and police officers of this community can afford to live here,” said Barbara Chase, executive director of the Whatcom Business Alliance. “The first step in having a real discussion about housing is to increase supply. We do not build nearly enough single- or multi-family housing units in this county. As long as we are the more beautiful, cheaper, higher-quality-of-life alternative for Seattle and San Francisco tech workers who can now work from home, our prices will continue to escalate. If this communi-
ty really wants a housing policy that promotes inclusivity and diversity, we must build more houses. It is that simple.” Practically, Kent has some advice for first-time buyers trying to find a home in Whatcom County. “First-time buyers need to accept that they aren’t purchasing the home of their dreams. It’s OK to buy something without granite counters and hardwood floors,” he said. “Additionally, and this might sound counterintuitive, but prices are escalating so fast that buyers who are trying to save for a down payment will be outpaced by the market. If you are a first-time buyer, contact a mortgage broker. There are a surprising number of options for buyers who have little-to-no down payment.” The hot Whatcom County pandemic-era real estate market is a mixed blessing. Home sellers have extraordinary power in the current market, and the real estate industry itself — including agents, brokers and bankers — is an important part of the local economy. Commissions and fees aren’t just income for agents, brokers and bankers; when agents and bankers are local, that income cycles through the local economy. A small portion of every local agent’s commission eventually makes its way to the county restaurants and small businesses that are struggling to survive. However, the housing market in Whatcom County is a vivid illustration of a series of policy choices that, while well-intentioned, can create a disaster for working families. The stay-at-home orders intended to minimize the impact of the pandemic have helped create a class of wealthy workers earning San Francisco and Se-
“...this year has been like no other. This has been the most unpredictable year in the 22 years I’ve been in the business.” Mike Kent, Windermere Real Estate and Mike Kent Real Estate Sales & Marketing
attle salaries from their living rooms. Like anyone would, those workers looked around to see if they could find cheaper living rooms in other beautiful places that had the added benefit of having less traffic and fewer people. They found Whatcom County, a beautiful community that strives to maintain its specialness in part by limiting new development. The result of that limited development is a market with too little inventory that is rapidly becoming affordable for only the privileged — but because that community has grown increasingly attached to a specific political 35 LUXURY ROOMS
ideology that is distrustful of business, it rejects the most foundational component of any affordable or workforce housing policy: an inventory of actual houses, built by the private sector. One thing is certain, though: Despite (or maybe because of) the pandemic, Whatcom County’s housing market is hotter than ever, and if our community wants to become more inclusive, it must partner with the private sector and identify ways to increase singleand multi-family housing stock — before Whatcom County becomes a bedroom community for the rest of the West Coast.
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Your company can help local youth develop valuable career skills and your workforce needs. Create your company profile and start posting jobs
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Our first virtual job fair was a success! Over 200 participants from six different school districts, and 18 businesses/panelists with two breakout sessions. Students, teachers, parents, and career counselors heard about local opportunities for family wage jobs for those straight out of high school all the way to advanced degrees required. If you want to become a supporter for the upcoming 2021 events, visit: www.yeswhatcom.com/career-fairs
BUSINESS FEATURE BP
PHOTO: Tiffany Brooks
Seeking Health sees zooming growth Company’s performance remarkable even before COVID-19 Cheryl Stritzel McCarthy In an industrial park tucked away in a little-known area of Bellingham is a company that’s garnering national attention for exceptional growth. Founded by naturopathic physician Ben Lynch in 2011, Seeking Health is on track to achieve $28 million in annual revenue for 2020, a 32% increase over the year before. From 2016 to 2019, Seeking Health grew 43% in revenue. In 2015, it was the No. 1 fastest-growing company in the state, and 37th nationally, on Inc. magazine’s list of fastest-growing privately owned companies. Seeking Health, which sells nutritional supplements and healthy living video courses online, made Business Pulse’s Top 100 list of privately owned companies in 2019 and 2020. A lot of that growth came before COVID-19, which is
delivering a boost to e-commerce in general. How it happened Lynch, the company’s owner and president, says Seeking Health’s growth results from this pattern: research, educate, create a new SKU, repeat. Profit generated by the new product goes toward creating the next. “All the money I made, I put back in the company,” Lynch said. “Growing a business is a lot like growing a kid. It takes nurturing.” Seeking Health formulates 90% of the supplements it sells. To create products, Lynch researches genetics, common variations and their function and dysfunction, and then he formulates supplements to support those genes. Seeking Health’s top 10 products include various vitamin supplements, including prenatal; probiotics; histamine
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blocks; and electrolyte powder. The top 10 products account for 30% of the company’s diverse product line, said Adam Rustad, Seeking Health’s chief executive officer. The company of 28 employees currently has about 125 products, including items such as prenatal protein powder suitable for smoothies, and immune-support and anti-inflammation supplements. “We don’t have a marketing department; we have an education department,” Lynch said. “I’m looking at known research. I’m just putting it together. Other researchers look at isolated variables. My system allows me to look at how it all works together. “We are way ahead of where conventional medicine is today. We are ahead of research. Most people are not ready. You have to educate.” The education part involves speaking to health care providers at conferences and to the public. Lynch’s field is nutrigenomics, which is the interaction of nutrition and genes, especially with regard to optimizing their function and preventing and treating disease. He is the author of the 2018 book “Dirty Genes: A Breakthrough Program to Treat the Root Cause of Illness and Optimize Your Health.” The company’s online video courses include the Dirty Genes Summit, a 46-hour course featuring 50 health care professionals, and the Dirty Genes Course, which features Lynch speaking on his foundations of health: air, food, water, environment and mindset. The “dirty genes” name comes from the concept that genes perform jobs, and this can be negatively affected by stress, infections and exposure to pollutants in the environment, leading to symptoms. Many of the company’s online video courses originated from recordings of
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Lynch speaking at conferences. It’s a good way to leverage assets, he said. “If I’m going to spend months researching and creating a conference topic, I’m going to pay a videographer and make it into a course,” he said. “In med school, you learn that your brain is an asset.”
Lynch said. “I’m a big nature guy. Bellingham has the cleanest air in the nation. I wanted to own a warehouse, and I didn’t want to do that in Seattle.” Lynch started Seeking Health as a product line within Healthy Goods and launched it as a separate online company in 2011. In 2012, he sold Healthy Goods but kept Seeking History Health. Lynch graduated from the Universi“Healthy Goods was selling other ty of Washington in biology, with the people’s products that were good but molecular and cellular option, before not great,” he said. “I knew I could do earning a naturopathic doctor degree better.” from Bastyr University in Seattle and After Lynch sold Healthy Goods, graduating as a doctor of naturopath- his Kentucky Street warehouse was ic medicine in 2007. Naturopathic suddenly empty of products except for medicine is primary health care that one row of shelves 6 feet tall and 15 emphasizes prevention and self-heal- feet long. “I was like, uh oh, what did ing through healthy living and natu- I just do? When you have fears like ral therapies, combined with current that … I’ve learned to push myself in research. uncomfortable situations. Most of the He started his first online business, time, it’s the right move, though it’s Healthy Goods, while a student at Ba- extremely scary.” styr. Healthy Goods sold such items as In 2014, after bringing it through water filters, air purifiers, supplements, three years of formulation, Lynch reenergy bars, essential oils and natural leased what would be a pivotal Seekshampoo and toothpaste. When a ing Health product: Optimal Prenatal. supplier stopped supplying one of his The product came about from his products, lactase drops for lactose-in- research into a gene that is associated tolerant children and adults, Lynch with myriad ailments. Optimal Preformulated it as his first product. natal contains the most biologically “I made it stable,” he said. “I made available form of folate, essential to it better. It’s good for infant colic and cognitive development, and folinic lactose-intolerant kids and adults. We acid, a form of folate that is easily constill offer it.” verted within the body. “Both are suLynch, married with three young perior, natural forms of folate,” Lynch sons, ran Healthy Goods out of his said. garage in Bothell from 2007 to 2010. After launching the product, he In 2010, he bought a 6,000-square- started hearing from women who’d foot warehouse on Kentucky Street in suffered from infertility and miscarBellingham for about $500,000 with riage but were now pregnant. “I starta loan from the Small Business Ad- ed speaking at health conferences, ministration and moved his business then directly to the public,” he said. north. In 2011, Healthy Goods had “Moms and dads would come up to seven employees there. me, holding their baby, and say, ‘This “I’ve always loved Bellingham,” is a Seeking Health baby.’ That was
really cool, seeing that.” Onward and upward By 2014–2015, Seeking Health needed more space. “I was looking at warehouses in Bellingham,” he said. “I kept looking at a building on Mercer (Mercer Avenue, off Marine Drive), but it was $3 million. I was terrified. I was debating whether I should sell (the business). One day, I made the decision to just go for it. I wanted to expand the prenatal line; I wanted to help more people. I felt Seeking Health could be my vehicle. “I put an offer in on the building.” The new 45,000-square-foot warehouse was half occupied by a tenant, who would remain. That half was clean and orderly. The half available to Seeking Health was otherwise. “It felt like I walked into a 1950s Goodwill,” Lynch said. “The building was trashed. Garbage, old stuff, heavy equipment, lime green walls …” But Lynch thought they could transform it. Today, Seeking Health’s offices and warehouse, which include a gym for employees, are highly appealing. In 2015, with 13 employees, Seeking Health landed at No. 37 on Inc. magazine’s national list of fastest-growing companies. The growth felt explosive, Lynch said. They didn’t yet have core values in place. Employees were hired via friends of friends or Craigslist, and Lynch felt he was scrounging to be efficient with expenses. But he kept reinvesting profits to research and formulate new products. “That’s how we grew, since we were releasing quite a few new products that were doing very well for people,” he said. “We didn’t even have a marketing department. It was primarily word of mouth.”
Those seat-of-the-pants days are behind the company. Today, Seeking Health has 28 full-time employees and expects to hire more. There is a program called Optimizing Lives, which donates 7% of profits to good causes (most within Whatcom County) and pays employees for 20 hours
of community volunteering. There is a mission statement and a BHAG (Big Hairy Audacious Goal, a term coined by a business author, pronounced beehag) of reaching $50 million in revenue by fiscal year end 2023. Judging from this company’s track record, they are likely to make it.
PHOTO: Tiffany Brooks
Seeking Health Founder and Owner Dr. Ben Lynch and CEO Adam Rustad.
Hitting financial targets On a Friday afternoon in 2013, Adam Rustad, a commercial loan officer for Peoples Bank, paid a call on his new account, an online purveyor of nutritional supplements called Seeking Health. Seeking Health was in its Kentucky Street warehouse then. Rustad was waiting in the front office area when Seeking Health’s founder and owner, Ben Lynch, bounded out of the warehouse dressed in a T-shirt and shorts. Rustad thought, Here’s the owner of the company, not sitting in an office chair, but getting his elbows dirty. The two talked business, then sports. Lynch plays soccer, and Rustad, hockey. “First time I met the guy,” Rustad
said. “It clicked, right off the bat.” As months rolled by, Rustad as banker would point out weaknesses within Seeking Health, which Lynch appreciated. Lynch said, “One of our core values is ‘Never Settle,’ and Adam aligned with that. What can we make better?” The first year that Rustad was Lynch’s banker, Lynch created a financial forecast and emailed it to Rustad, who replied it was too aggressive. But Seeking Health achieved it. The second year, the same thing happened. And the third. After that, Rustad quit the bank, and in 2016 came on board as Lynch’s CEO.
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PHOTO: Tiffany Brooks
Ben Lynch, doctor of naturopathic medicine and owner and president of Seeking Health.
COVID-19’s effect on Seeking Health Before COVID-19, a typical month’s orders at Seeking Health were $2 million. March 2020 saw orders double. Getting hit with that heavy order list was a good thing, Rustad said. It stress-tested the company’s processes and helped them improve. “We no longer had to envision what a $50 million organization would feel like; we lived it for five weeks,” Rustad
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said. “It gave us a great opportunity to sharpen the saw.” The $50 million refers to Seeking Health’s stated goal of achieving that level of annual revenue by fiscal year end 2023. The demographics of the company’s market shifted, too. Before COVID19, the 55-and-older demographic comprised 25% of visitors to Seeking
Health’s website. In March and April, that became 35%. “Likely, it was the first time they were purchasing online rather than in brickand-mortar,” Rustad said. That data prompted a question: How should that affect education and marketing going forward? That particular age demographic shift didn’t last, but Seeking Health continues to see a substantial increase in visitors to their online retail store: Before the pandemic, it averaged 110,000 per month; now it’s 160,000 per month. Those figures do not include March and April 2020, which for data-gathering purposes were discarded as outliers. Seeking Health’s warehouse fulfills 650 to 800 orders per day, seven days a week. COVID-19 highlights the need to pay attention to employees’ mental health, Rustad said. “Organizations need to check in with their employees. It was good for us to be engaging with their questions.” COVID-19 is also affecting the supply chain for packaging materials. One other effect? Some of the recommendations that Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases at the National Institutes of Health, recently made on supplements, such as vitamin D helping reduce the risks of COVID-19, were the same ones that Seeking Health’s owner and president Ben Lynch, a doctor of naturopathic medicine, had made six months earlier, Rustad said. But Lynch’s post was auto-deleted by the platform. Posts by Seeking Health are regulated by the Food and Drug Administration and Federal Trade Commission and can fall victim to Facebook’s and Twitter’s algorithms. As Rustad said, a particular challenge in the time of COVID-19 is how to educate consumers while staying compliant with federal guidelines and social media algorithms.
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BUSINESS PROFILE BP
PHOTO: Business Pulse staff
Hardware Sales thrives on software sales Local company stands tall in the big-box era Mike McKenzie total of 146. And that is despite being amid such national brands as Home Depot and Lowe’s (which have around 4,200 stores nationwide, combined) and Ace Hardware, which has four locations in Whatcom County. And who would have guessed that one of the strongest products of the flourishing 2020, COVID-19-driven internet sales would have been chicken feed? “Since the pandemic,” said Steve Douge, the director of e-commerce for Hardware Sales, “our online sales of chicken feed is up over 100%. We shipped close to PHOTO: iStockphoto.com/Voren1
A Bellingham original, Hardware Sales stands tall not just as a survivor of the big-box era, but also as a steadily growing, perennial Top 100 company in Business Pulse’s annual listing of privately owned businesses. Internet buying power has taken over as the top driver of revenues. HardwareSales.com generated approximately $41.3 million in 2020 e-tail sales — almost 60% of total company sales — largely through a strong Amazon affiliation and other third-party platforms (eBay, for example). A third-generation family company, Hardware Sales ranks in the top quarter of the Top 100 local companies ranked by Business Pulse. Last year saw about 8.25% growth and added a dozen jobs, for a current employee
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“We’re also seeing a surge in sales for [generators and pumps] for use in general disaster preparedness. People see all the things that 2020 brought and they wonder what is next, and they try to prepare.” Steve Douge, director of e-commerce at Hardware Sales
three million pounds of chicken feed and supplements.” Another partnership spurred that surge: Hardware Sales has become the national distributor for Scratch and Peck Feeds, the Bellingham startup that 10 years ago was among the finalists for the Business Pulse Startup of the Year award. A family-owned entity like Hardware Sales, it has grown rapidly on the strength of using locally grown ingredients and having been the first in its market to earn both organic and non-GMO certifications. Several other product lines rang up for HardwareSales.com on an exponentially larger scale wrought mostly by the shuddering and shuttering effects of COVID-19 — stay-in-place, do-it-yourself trends — and by natural disasters.
PHOTOS: Business Pulse staff
“We always do well with generator sales, especially any time of natural disasters,” Douge said. “We had more hurricanes last year than any other year in recorded history, and the fires on the West Coast have been especially devastating. We’re happy to make generators and pumps available. We’re also seeing a surge in sales for these items for use in general disaster preparedness. People see all the things that 2020 brought and they wonder what is next, and they try to prepare.” Douge added that products related to woodworking “have done very well for us, with more people stuck at home. They have more time on their hands to invest. They’re spending their vacation money and savings from not eating out on fixing up their home and on their hobbies.” Hardware Sales has become the national distributor for Scratch and Peck Feeds, the Bellingham startup that 10 years ago was among the finalists for the Business Pulse Startup of the Year award.
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Hardware Sales typically sees a surge in woodworking sales during winter months, Douge said, but throughout the pandemic, and with the holiday season approaching, sales have become stronger and stronger. Plus, with people staying home, Hardware Sales has seen an increase in products related to yardwork and repairs or other improvements around the house, he said. The internet sales division, though described by company owner Ty McClellan as “a rocky road” ever since it started, has been bulging at the seams since purchasing Douge’s small internet marketing company in 2006. The online sales team started in the main store on James Street but quickly ran out of room, Douge said. So the company bought a nearby warehouse, outgrew that, rented another building next door and eventually rented another building across town. In 2008, Hardware Sales built its own 20,000-square-foot warehouse in Ferndale and added 12,000 square feet three years later. That facility, with its 20 employees, is now the home base of the online operations.
Amazon fuels the operation — so much so that in 2018, Hardware Sales leased a 53,000-square-foot warehouse in a suburb of Indianapolis, to accommodate growth. The lease primarily met Amazon’s requirement for second-day shipping to the East Coast. That facility employs 10, led by Tyson Simmons, the former Ferndale warehouse manager. “We have years of expertise managing the third-party selling space,” Douge said, “and we’ve focused our efforts on being experts at Amazon.” He said that about 80% of the company’s online revenue comes from the Amazon platform (which, by the by, corners about half of the world’s internet transactions and, at 2.5% a year, doubles the average growth rate of all other e-tail platforms) and the rest from the eBay marketplace and the company’s own website. Two big pictures factor into this success equation: Amazon’s threepronged power and the ease of internet consumerism. “We manage several brands on Amazon.com, (which) purchases products directly from manufacturers and allows other retailers to sell on the platform,” Douge said. “Amazon provides three main things: One, the recognizability of its website. Two, Prime shipping. And three, its customer service policies.” He pointed out that customers want to know what they are dealing with, which they get with Amazon. “Good or bad,” he said, “it’s mentally much easier and perceived as safer than dealing with many different websites all with their own policies and expectations.” Hardware Sales distinguishes itself by providing what Amazon delivers but with more customer-friendly
practices to increase exposure to the listings and create a higher conversion rate for more sales.” Sounds like a win-win. “The manufacturers get a much better experience working with us,” he said, “and they sell more products. “We have years of expertise Amazon also wins because they take a cut of each sale and don’t need to do managing the third-party any work for that cut.” selling space, and we’ve The internet shopping trend is focused our efforts on looking like it will continue in 2021, being experts at Amazon.” Douge said. “Online sales are up across the Steve Douge, director of board,” he said. “It’s generally easier e-commerce at Hardware Sales to purchase online and safer to avoid retail spaces.” benefits. Hardware Sales has benefited great“We’re much easier to work with,” ly from that consumerism. Douge said. “We don’t just buy and “We’re lucky to be in an industry sell. We manage the listings, main- that has grown during the pandemic,” tain the integrity of the data, use best Douge said.
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BUSINESS PROFILE BP
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How are gyms surving? An owner speaks on fiscal fitness during COVID-19 Cheryl Stritzel McCarthy The hammer swung down in March, nailing a “Closed” sign on fitness facilities and other businesses throughout Whatcom County and the state. In June, it lifted a little, allowing gyms to reopen with fewer customers and with other restrictions in place. On Nov. 16, as cases rose nationwide, the hammer swung down again, closing fitness facilities through mid-December. Cathy Buckley (pictured left) is owner and general manager of Bellingham Athletic Club. She joined the facility in 1991 as aquatics director and purchased the business
in 1997. She spoke to Business Pulse days after the November closure decree took effect.
two
How is business during COVID-19? Losing money hand over fist — shall we talk about that? It’s been more than challenging! COVID-19 seems to be a polarizing illness. Some people say, “What the heck, I’ll do what I want,” while others say everyone should stay locked down at home. Our membership runs the cross-section of Whatcom County. Some say, “How dare you open?” Some write me a check for $300 so I can stay open.
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People are struggling with mental health. Let them get their exercise; it’s a lifeline for them! There’s no evidence that (fitness facilities) are spreaders. It’s capricious the way (the government) is closing things down. When people call and are mad at me for being closed, I say, “Look, I’d be open.” I’d let them choose their risk. IHRSA (International Health, Racquet & Sportsclub Association, a trade association) showed the infection rate in gyms since reopening was .0023% (see sidebar “Gyms aren’t spreading the virus”). In January/February of 2020, we (Bellingham Athletic Club) had 5,000 members. In November 2020, we had 2,000. As for the restricted reopening in June 2020, it would have been more cost-effective to keep the club closed, but our commitment to members compelled us to open even in a limited manner. Exercise helps build your immune system. It’s so important, especially during this time, for our members to be able to exercise, relieve their stress and stay healthy. When we reopened in June, my very first member in the door was a 93-year-old gentleman with a walker. How did you mitigate (when you were open)? We screen everybody on the way in. We take their temperature. They sanitize hands and sign an affidavit affirming no contact with anyone who’s ill. They sign the affidavit every time, to keep it top of mind. We log them in and log them out. From June through mid-November, we had 10,000 member visits. We haven’t had anybody even with a temperature. People imagine a gym has all these people milling about, but it’s not like that. For a club like ours, people form their own co-
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hort, say at 7 a.m. Monday, Wednesday and Friday. It’s already a qualified group. Plus, we’ve been taking their temperature all this time. The other frustrating thing for business owners — we as a staff in early March came up with a procedure to keep our members safe, before any of the mandates came out. Then they closed us anyway. When we reopened, we had everything ready to go: thermometers, hand sanitizer and a lot more. I look at restaurants and all they’ve done, investing to improve the health and safety of patrons, and they get closed down anyway. (The government) wants to be science-based, but
Gyms aren’t spreading the virus A September 2020 study by the International Health, Racquet & Sportsclub Association surveyed the member check-in data of 2,873 fitness facilities since reopening along with the number of positive COVID-19 results. They recorded 49.4 million check-ins and 1,155 cases — with no evidence that any of those were contracted at the facility. According to IHRSA, early quotes from medical experts saying that gyms were high-risk environments were based on opinion rather than data. A subsequent study showed that 88% of members who returned to their fitness facility after it reopened were satisfied with the measures already taken and confident of their facility’s safety and cleanliness.
there’s no evidence of infection happening at our club. We put up plexiglass barriers for our instructors, all this stuff, and then it doesn’t matter. There’s a real frustration. The November closing came with just 24 hours’ notice! As a business, you bear layers of burdens, increased mandates, increased expenses … you do that and they close you anyway, and not because you’ve had any infections. At the end of the governor’s press conference, it was said “the absence of evidence is not evidence of absence.” It’s the classic definition of doublespeak. You’re making policy on that? It’s extremely frustrating for those of us who’ve worked so hard to comply. We’re lucky because we are an established business. Anybody who started in the last four, five years … We’ll make it through, but there are so many businesses whose passion, love, dedication and hard work are being flushed down the toilet. If it were based on good data, that’d be one thing. It doesn’t matter what you do, they keep moving the goal posts. What did business look like under restricted opening? Bellingham Athletic Club has 37,000 square feet at our Cordata location and 17,000 square feet downtown. In mid-summer, in a class that would have had 25 people, we had 12 in there. We had to cut everything in half. Generally, there was a maximum of 10 in the gym. You’re paying an instructor; with 25, it makes sense, with half it’s difficult. Your fixed costs are just that, fixed. Profit comes in the last 10%. Everything before that is cost. Like most small businesses, you plow that profit back into the business, upgrading your business or putting it in reserve so you
have something to fall back on during rough times. As a small business, you’re lucky if you can pay yourself. I had 80 employees in March. In early November, I had 35. Now I have eight. What will stay after COVID-19? I want to put COVID-19 in the rearview mirror and never say that word again, but these procedures we have in place — hand sanitizing, social distancing, cleaning — we’ll keep in place during flu season. We use hospital-grade disinfecting solution, what they use in operating rooms. We’ve used that for years and years. Our mission is health and fitness. We want to keep people safe and healthy! We’ll keep running online classes, some available to the entire community, some password protected. When people get sick, they can stay home and take the class virtually. I think schools will do the same. What’s ahead? Surviving! How long will it take to get back to 5,000 members? A minimum of 18 months. You have to be super responsible fiscally and really watch your dimes. All businesses will be digging out of this COVID-19 hole for at least a year and a half. I continued to pay everybody in the first shutdown; about three paychecks. It was supposed to be two or three weeks, but it went longer. When we ramped up again, we were at half strength. Of 80 employees, 30 are instructors who teach a handful of classes a week. It took a while to build back up to 35, now we’re at eight. Our mission is to help the community discover the joy of fitness. We are uniquely positioned to provide a safe place. Interview has been edited.
Change, then change again One fitness facility deals with restrictions Shift. Change. Pivot. It might sound like the latest dance move, but it’s what fitness facilities in Whatcom County are doing to stay alive. Robin Robertson (pictured right), co-owner of Bellingham Training & Tennis Club, with her husband, Doug, was keeping track of club changes sparked by government mandates when Gov. Jay Inslee re-closed fitness facilities in mid-November. Robin spoke on changes put in place before the midNovember total closure.
We shifted operations to accommodate limits on the number of people in each area of the club by requiring a reservation for every activity. The number is determined by Washington state. Requiring a reservation actually helps people be more consistent in their training. That certainly ends up as a win! Group training has shifted as well. The club now offers Zoom group classes along with live in-club classes as part of its regular schedule for indoor cycling, TRX (a style of whole-body workouts), TRX yoga and candlelight yoga. Our new training area has plenty of space, so participants are a minimum of eight feet apart. Strength-training classes have shifted to a small-group format with a maximum of five people and with equipment set up in a pod for each person. The tennis pros came up with a new program to get high school tennis players on the court, since there were no school-sponsored seasons. This provides for high school tennis competition in a COVID-19-compliant environment. Tennis clinics for kids and adults have been reduced to five students per instructor, and the response was such that we had to add additional times. Parents are relieved to have a COVID-19-safe activity for their kids, with easy social distancing on the open space of a tennis court. We now offer COVID-19-compliant middle school and high school strength and conditioning clinics. We’ve taken our Cycle Moles performance training to Zoom. Participants get twice-per-week training, plus access to recorded video rides so they can add more indoor cycling if they wish. With Zoom, we are not limited to the number of bikes in the room, and we can provide training to more people. All you need is a stationary bike or to put your own bicycle on a trainer device that turns it into a stationary bike. The club has installed a new heating, ventilation and air conditioning system. Cleaning protocols are strict, and protocols for staff and members help everyone stay safe while getting a great workout. We have lots going on for 2021. We are planning to offer more Zoom classes for tennis and fitness. Tennis is, after all, the perfect social spacing sport! Interview has been edited.
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BP PERSONALLY SPEAKING
PHOTO: iStockphoto.com/Nastco
Business in a seller’s (and buyer’s) market Personally speaking with Rob Washburn, Windermere Real Estate Mike McKenzie With 2021 drawing nigh, Rob Washburn — co-owner and designated broker of the Bellingham/Whatcom County agency of Windermere Real Estate — hopped on Zoom recently to reflect on the weirdness of the year’s home-buying market and the lessons learned from the COVID-19 pandemic. Rob Washburn The national Windermere brand operates broadly throughout the county, with eight offices and about 175 agents cornering over 40% of the annual market in primarily residential sales, though also with commercial and property management divisions. Rob Washburn’s father, Dan, now retired, bought the franchise 25 years ago and was the Business Pulse 2014 Lifetime Achievement Award recipient.
BP: What came before that? RW: I went to Redmond High School and graduated from Western Washington University, where I played rugby. After time in the Marine Corps, I became a CPA (certified public accountant) with a software development company in Seattle and then owned a food distribution company on Maui, Hawaii. I sold it and came back here. That company still exists.
BP: When did you start with the company? RW: I started working with Dad 15 years ago. (NOTE: Rob’s older sister, Danielle, also became involved with the company.) Wynden Holman (co-owner) and I bought him out when he retired. We still call him all the time.
BP: Does his “high demand, favorable interest rates, low supply” make it a seller’s market? RW: It’s definitely a seller’s market, but the low interest rate helps affordability for the buyer. Especially if you calculate the savings over the life of the loan.
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BP: Economist Matthew Gardner publishes an analysis on your website. Recently it stated, “Listing activity is woefully weak …” Why? RW: Several reasons: There’s not enough new inventory. People can’t sell their homes until they have a place to move to. They’ve locked in great interest rates. And COVID-19 caused people to move less because they were unsure about job security.
BP: So it’s a buyer’s market at the same time? RW: Yes, simply because of the banks. The cost of money went down. For example, you definitely could do well selling up here and buying in, say, Missouri. BP: What does that portend for a person/ couple/family seeking a home? RW: The positive power of the interest rates. You could’ve purchased a home last year, but even with the continuing increase in price, your monthly payment would have been lower because of the low interest rate. Just a one-point difference is huge. Regardless of the home price, it’s all about the payment. BP: The average home price in Whatcom County rose 16% in 2020, fluctuating just above and below $500,000. Why, when the economy and average income still lag? When demand exceeds supply, prices go up. Low interest rates are increasing demand while regulations and (home-buying) costs are slowing supply … for now. Low interest rates help fill the income/affordability gap. We’re also seeing out-of-the-area buyers with sufficient funds to cover the price. BP: What are some lessons learned in the industry from the COVID-19 crash from February through April and the remarkable recovery reported since? RW: The shutdown slowed sales, for sure, but we had some of our strongest numbers ever from June through September. We’re well ahead of 2019. People want to own homes. If anything, COVID-19 increased that desire. Especially out in the county. (NOTE: Windermere offices cover Ferndale, Blaine, Lynden, Everson and east Whatcom County in addition to Bellingham, Fairhaven and Sudden Valley. Three of those are commercial and/or property management offices.)
BP: How does the nationwide rollercoaster ride of 2020 (now on the rise) affect real estate projections and forecasting for 2021? RW: There’s no crystal ball, but Whatcom County has a lot going for it and will do well in the future regardless of the national situation. Whatcom always seems to avoid the extremes of valuations. BP: Do the favorable recovery stats of unemployment, listings and pending sales make the future clearer and more predictable? RW: We’re lucky to have a local economist and have the Gardner Report, with Matthew. In a recent update, he was asked about what the effects of the election results might be — both here and nationally. His first response was, “I don’t know.” BP: Did he elaborate? RW: He said that things could stay pretty much the same, depending on outcomes (in key political races). But with President Biden there could be a lot of executive orders to navigate, such as subsidized housing, zoning reform and non-refundable tax credits. And elimination of bonus appreciation in real estate to offset income by writing it off 100%. BP: Will local home-purchasing supply increase? RW: It looks like there is more housing coming on the market, both in multi-family and single-family. BP: What effect will that have? RW: That might soften the amount of price increases. BP: Reports show home sales shifting northward out of King County and its surrounding counties, especially to What-
com. What drives that? RW: Ability to work from home. Appeal of smaller communities. Better social values. Some political motivation. Less-expensive homes. BP: How does Whatcom stack up on a national level? RW: We are expensive nationally and increasing faster than the average. But, again, people want to live here. We don’t see that changing. BP: Because? RW: People live some places because it’s where the work is. People live other places because it’s their lifestyle. Whatcom County is big on lifestyle. BP: How does your commercial division look for 2021? RW: We work with some outstanding developers and builders, and we expect a lot of inventory. It’s exciting. Inventory for everybody to sell. BP: A curiosity: New apartments opening up in Fairhaven will bring $2,000 a month rent. Why so high? RW: The ability to live in our community, with the walkability of Fairhaven. I believe that was a penthouse. BP: Finally, on another note: How’d the first-ever “Day of Giving” go recently for the Windermere Foundation? RW: Excellent. Thanks for asking. We raised over $10,000 for the meals program of the Boys & Girls Clubs of Whatcom County. We also had another successful “Kicks for Kids” partnership with them in December. (NOTE: In this program, Windermere real estate agents take a child to pick out a pair of shoes at Famous Footwear, and the company collects donations of socks.)
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BP TAX POLICY
PHOTO: iStockphoto.com/scyther5
What to expect from a Biden administration and its tax proposals A lot could depend on who has control of the Senate Sean Kanaley, Andrea Monroe, Michelle Walker and Tyler Mickey in the Senate, with Kamala Harris casting the tiebreaking vote as vice president. However, if the Republicans win at least one of the two races, they will retain control of the U.S. Senate. If Joe Biden does get sworn in as the next U.S. president on Jan. 20, how would control of the U.S. Senate affect his proposals? We take a closer by comparing them with current tax law for businesses and individuals and recapping post-election economic reactions.
Control of the U.S. Senate
With the Democrats retaining the majority in the U.S. House of Representatives, control of the Senate may be the decisive factor in determining whether Biden’s proposals could become law. Control of the U.S. Senate won’t be determined until after Georgia’s runoff election on Jan. 5. Georgia law requires a candidate to be elected by a majority vote, and there wasn’t a majority winner in either of Georgia’s U.S. Senate races. A Democratic win in both Senate races would provide an even 50-50 split between Democrats and Republicans
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Other mechanisms for change A president can also implement limited tax policy through executive orders or Treasury Regulations. Here are some examples: • President Trump, on Aug. 8, 2020, implemented the elective deferral of withholding, deposit and payment of certain payroll taxes through the end of the year. • The Obama administration, on Aug. 2, 2016, promulgated the Section 2704 regulations in an effort to limit discounts of family owned entities for estate and gift tax purposes and issued regulations under Section 7874 and Section 367 addressing inversion transactions and limiting the utilization of post-inversion earnings stripping strategies. Executive action can also include removing or changing proposed regulations. For example, the Trump administration withdrew the above proposed Section 2704 regulations in 2017.
Biden tax proposals Here is a side-by-side comparison that shows current tax law as well as proposed changes from Biden, including those for businesses (both domestic and those operating internationally) and individuals.
Comparison Table for Business Proposals
Businesses There’s anticipation that a Biden presidency’s tax policy, in an effort to raise nearly $3.5 billion in revenue, could reverse many of the business-friendly provisions enacted via the 2017 tax reform act. Many of the proposed tax increases and eliminations of preferences are directed toward high-income taxpayers and larger multinational businesses. The impact of Biden’s proposals would be felt across business entity types and by the individuals who own those businesses. Here are some highlights: • Corporate taxpayers. The proposed tax rate increase is still lower than the 35% corporate tax rate from before the 2017 tax reform act. For some corporate taxpayers, the book value of net operating loss carryforwards would increase as the corporate rate increases, but the 15% minimum tax may blunt this benefit for corporations with
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annual book income over $100 million. • Flow-through entities. The qualified business income deduction, also enacted by the 2017 tax reform act, allows individuals who own businesses taxed as sole proprietorships, partnerships and S corporations to reduce their effective highest individual tax rate, from 37% to 29.6%, by way of a deduction based on 20% of the qualified business income earned. Under the Biden proposal, the qualified business income deduction could be phased out for business owners whose annual income exceeds $400,000. • Top bracket of capital gains tax. This proposal could increase to equal the top ordinary income tax bracket, eliminating favorable tax treatment for the highest-income earners. The impact of the top capital gain rate increase would be felt most in the context of how transactions impact corporate shareholders and flow-through entity owners. • Choice of entity. Decisions around entity choice could become more challenging with Biden’s tax proposals. Higher corporate rates and less substantial increases in individual rates could drive more businesses to seek the tax efficiencies of flowthrough entities; however, a corporation wouldn’t be impacted by an increased top capital gain rate and the phaseout of the qualified business income deduction. Ultimately, changes to individual tax rates impact businesses as well by affecting the decision-making of
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business owners. • Credits and incentives. Several new or expanded tax credits and incentives are included to help reduce tax burdens for small businesses and working-class Americans. International Biden’s international tax proposals aim to help incentivize U.S. companies to bring production jobs back to the United States. They also eliminate some corporate tax breaks passed by the Trump administration. Proposed plans could provide a 10% “Made in America” tax credit to companies to encourage onshoring of manufacturing activity and the expansion of U.S. production jobs. Biden also has proposed plans that could eliminate the 50% deduction from global intangible low-taxed income currently available to C corporations and impose a 10% surtax on imports from offshored business activity. While few details have been released regarding the international tax provisions contemplated by Biden’s plan, the changes to the global intangible low-taxed income provision alone could raise $289.7 billion in revenue over the next 10 years. Individuals Biden’s tax proposals would provide a tax increase for higher-income taxpayers: • Top ordinary income tax rate could return to its pre-2018 rate of 39.6%. • Itemized deductions limited to 28% of adjusted gross income • Return of the 3% phaseout of itemized deductions for higher
incomes. Capital gains and qualified dividends for taxpayers with income over $1 million would be taxed as ordinary income, ending a preference for capital gains that has existed since 1922 (with the exception of 1988 to 1990, when the highest marginal tax rate on all income was 28%). The estate and gift tax exemption could be significantly reduced from its current level of $11.58 million. Biden has provided limited information about his plans but has indicated his desire to reduce the exemption and increase the rate. The elimination of the basis step-up of inherited assets also was proposed. An open question is whether a Biden administration could change the final Treasury Regulations issued on Nov. 26, 2019. According to the regulations, gifts that utilized the higher exemption amount before it’s currently set to be reduced on Jan. 1, 2026, won’t be clawed back into a taxpayer’s estate if the exemption is later decreased. Expansion of individual tax credits On the other end of the spectrum, Biden’s proposals include increasing the child care tax credit, child tax credit, and student loan relief; reinstating the first-time home buyer’s credit; and increasing the eligibility for the premium credit under the Affordable Care Act. These proposals could also increase the refundability of many of the previously mentioned credits. Other tax provisions Biden proposed additional changes to retirement accounts, payroll tax and health care.
To view additional comparison tables on proposals for, International, Individuals and Other Provisions, visit https://bit.ly/2KpFVE4
For retirement accounts, Biden’s proposal would aim to increase access and participation by subsidizing the establishment of additional employer plans and changing the current individual deduction to a credit, limiting the tax benefit for higher-income taxpayers while incentivizing lower-income earners. For example, using a 26% rate, a taxpayer earning $600,000 and contributing the maximum of $19,500 to a 401(k) plan receives a tax credit of 26 cents on each dollar, or $5,070 (versus the current law, which is a $19,500 deduction at 37%, or $7,215). However, a person earning $50,000 and contributing $5,000 to the same 401(k) plan would receive a credit of $1,300, which is likely more than double what they are currently receiving as a benefit, assuming a 12% marginal tax rate. Economic update In the weeks preceding the U.S. presidential election, the stock market was pricing in the potential for large fiscal spending. The anticipation of a blue wave election, wherein Democrats win control of Congress and the presidency, caused longer-term Treasury bond yields to move higher —
the curve steepened — and there was rotation from growth and technology stocks to more cyclical reflation plays. However, post-election, that trade reversed course somewhat, with bond yields slipping 10 basis points on Nov. 4, 2020, reaching a two-week low — prices increased — and cyclical stocks sold off while technology and health care rallied. In following days, stocks were mostly higher across the board because Wall Street priced in the prospects of a divided government with a Republican-controlled Senate. Senate and House control The working assumption is that, regardless of who wins the White House, a Democratic House and a projected Republican Senate would mean a smaller stimulus package — $1 trillion to $1.5 trillion, versus $4 trillion — and more limited infrastructure spending. This is important because the market had bid up construction and industrial companies, betting that a blue wave would mean a large infrastructure bill to fix roads, bridges and highways. However, on Nov. 4, those infrastructure-oriented stocks reversed
course, trading lower, while technology favorites like Google, Facebook, Amazon, Microsoft, Apple and Nvidia made strong gains, repricing some of the previous posturing. Of course, this outcome isn’t etched in stone, as there are two Senate positions still in play in the Georgia runoff elections in January. While it isn’t the consensus view, if those two seats should be taken by Democratic candidates, the market may once again reassess the implications of a 50-50 Senate, with the tiebreaker going to the vice president. ■ Sean Kanaley has practiced public accounting since 1998. He specializes in tax planning and compliance services stemming from transactions. He also consults with clients on the impact of transactions on tax return filing positions, purchase price, purchase accounting and financial statement disclosure. He can be reached at sean.kanaley@mossadams.com or 949-221-4095.
Andrea Monroe has practiced public accounting since 2005. Her focus is on international tax, and she assists clients with United States tax reporting requirements, tax structuring and managing their worldwide effective tax rate. You can reach her at 206-3026371 or andrea.monroe@mossadams.com. Michelle Walker has worked in the financial services industry since 1993 and is experienced in multi-asset class allocation, portfolio construction and macroeconomic analysis, as well as traditional and alternative manager due diligence. She can be reached at 206-3026462 or michelle.walker@mossadams.com.
Tyler Mickey has practiced public accounting since 1996. He specializes in helping domestic and global individuals and business owners with taxation, planning, and compliance with wealth, income, estate, gift and charitable giving. He can be reached at 509834-2494 or tyler.mickey@mossadams.com.
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PHOTO: iStockphoto.com/oksanaphoto
BORDER POLICY BP
What can we expect at the border in 2021? A return to a pre-pandemic border seems unlikely Laurie Trautman On March 21, 2020, the United States and Canada took unprecedented bilateral action and restricted cross-border land travel to “essential” purposes. While commercial cargo, essential workers and a handful of other travelers are able to cross the border, the vast majority of travelers are prohibited. Both the U.S. and Canada have remained in lock step in their continual 30-day extensions of the border restrictions. Given the high rate of infection in the U.S. visà-vis Canada, and the overall state of the pandemic, these border restrictions are likely to remain in place until cross-border mobility can resume in a way that does not endanger public health. As a result of the restrictions, crossings between British Columbia and Washington are down roughly 97%. The month of August is typically the busiest month for cross-border travel in
our region, with an average of 400,000 cars crossing into Blaine. In August 2020, just 16,000 cars entered the U.S. at the Blaine crossing.The restrictions have had an immense economic impact on various sectors in Whatcom County, ranging from tourism to re-
As we look to 2021, it is clear that the border restrictions are likely to remain in place for months to come. A best-case scenario would see the pandemic easing in both countries, with infection rates dropping to a level that both the U.S. and Canada view
The month of August is typically the busiest month for cross-border travel in our region, with an average of 400,000 cars crossing into Blaine. In August 2020, just 16,000 cars entered the U.S. at the Blaine crossing. tail. In 2018, 5.4 million visitors from Canada traveled to Whatcom County, primarily to shop, pick up mail and buy gas. The Border Policy Research Institute at Western Washington University estimates that nearly 12% of Whatcom’s taxable retail sales are attributable to Canadians. In addition, Whatcom County’s hospitality sector, the Bellingham International Airport, and second-home ownership are all additional aspects of our economy that are impacted by Canadians and other cross-border travelers.
as manageable to enable the lifting of border restrictions. Perhaps we can accomplish this by late spring, aided by advancements in vaccine distribution. Regardless of infection rates, however, it is unlikely that we will return to a pre-pandemic border and more likely that testing or proof of vaccine will become a requirement for crossing the border. A number of airlines and airports around the world (including inbound flights to Hawaii) are already implementing testing protocols. A worst-case scenario would imply
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that the border restrictions remain in place throughout 2021. This is a less likely situation for several reasons. First, there is real progress being made both on a vaccine and on developing policies to screen for COVID19 at the border. In addition, maintaining the restrictions in their current state is not sustainable. Canada has already made several exemptions to the restrictions, recognizing the vital nature of the cross-border ties between our two countries not only because of our economic interdependence, but also for our families and loved ones. It is in both nations’ best interests to have a fluid border. Canada and the U.S. have a history of working collaboratively to “thin” our shared border while also improving efficiency and security. Our border policy innovations have been successful because they have been aided by long-standing relationships anchored in trust. After facing a number of challenges to those relationships during the previous four years, we can expect a return to “normal” Canada-U.S. relations in 2021. This will re-establish a shared platform for policy collaboration that is necessary in order for cross-border mobility to resume. Laurie Trautman is the director of the Border Policy Research Institute at Western Washington University. She engages in a range of research activities focused on the Washington–British Columbia region of the Canada-U.S. border. In addition to working with faculty and students, she collaborates with the private sector and government agencies to advance policy solutions and promote cross-border collaboration. Trautman participates in numerous working groups that are actively engaged in the U.S.-Canada relationship, and she is a member of the steering committee for the Cascadia Innovation Corridor. She also serves as a Global Fellow with the Woodrow Wilson Center and a Fellow with the Canadian Global Affairs Institute.
MARKETING BP
PHOTO: iStockphoto.com/Blue Planet Studio
Intern, part-time employee or contract marketer? Each option has pros and cons Patti Rowlson If your business is on the cusp of needing help with marketing and communications, you’ll first need to consider whether you want to work with an intern, hire a part-time employee or outsource the work to a contracted marketer. Each option has pros and cons. Let’s look at them in turn.
On the other hand, one downside to working with interns is that they are intended to be short-term (three- to six-month) hires. After that time, interns move on to continue their education or to find permanent employment. Unless you end up hiring an intern at the end of the term, you will need to go through the selection process again and train a new intern to work on your company’s marketing projects. That takes time and energy.
Should you work with intern marketers? First, it’s important to recognize that interns should not be considered free labor. Volunteer programs are useful for free labor; internships are intended to provide immersive work experiences for a limited time. Interns should work under the direction of someone with experience who can provide instruction and guidance. You set up the projects; they follow, implement and report back. One benefit of marketing interns is that they can offer unique perspectives. They can share fresh ideas and help target a new demographic of consumers for your business. They can be a breath of fresh air!
Should you hire a part-time marketing employee? There is more to hiring your first marketing employee than selecting the skills you desire, setting an hourly wage and placing an ad on Indeed.com. Bringing a new team member on board also involves recruitment time (interviews, reference checking, skills testing) and expenses related to payroll, taxes and benefits. Hiring an experienced marketer who is willing to work part-time can be challenging, and it can be difficult to find one part-time person who is good at all necessary marketing duties, including website management, copywriting, so-
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cial media management, copyediting, graphic design and public relations. That said, hiring a part-time marketing employee can be a good option, and you should be able to find one who has some experience and who will be able to get up to speed in your business within a few months. The most important part is to be patient until the right match comes along. Should you hire a contracted marketer? Retaining the services of a contracted marketing pro can be like hiring an executive-level marketer on a part-time, as-needed basis. The work will cost more per hour, but you will not need to go through the employee recruitment and hiring process. You won’t need to manage payroll, taxes,
WHAT TO OUTSOURCE? The following projects are excellent things to outsource to a contracted marketing provider: Email marketing, blogging, social media management, corporate communications, recruitment advertising, graphic design, online review management, media releases, website technical support, project management and the editing of documents you create in-house.
insurance, continuing education or break times. A contracted marketer is only “on the clock” when doing actual work for your business.
One challenge to working with a contracted marketer is that the person will not have feet on the ground in your place of business, so you’ll need to work collaboratively to share company news and distribute useful collateral, such as videos and photos. In summary, when the time is right to get help with marketing and communications, you have options. Understanding the pros and cons of working with interns, hiring a parttime marketer or retaining the services of a marketing service provider will help you make the best decision possible for your business. ■ Patti Rowlson is the founder and communications director at PR Consulting in Bellingham. Since 2009, she has helped small businesses and large corporations manage public relations and communications for a variety of stakeholders. Patti has been recognized for her work in the community by being named Most Valuable Player, Small Business of the Year finalist and Professional Woman of the Year finalist. She currently serves on the board of the Whatcom Business Alliance. Visit https://pattirowlson.com.
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HEALTH BP
PHOTO: iStockphoto.com/sestovic
Wake up from lockdown inactivity Working out can help stave off the ‘COVID 15’ Jeannett Penner The health benefits of regular exercise are so extensive that it is no wonder many people make New Year’s resolutions to commit to a fitness program. Some of the health benefits of regular exercise include weight loss, reduced risk of cardiovascular disease, reduced risk of high blood pressure, lower risk of Type 2 diabetes and reduced risk of high cholesterol. The mental health benefits of
exercise include reduced anxiety and depression and increased sleep. As individuals age, exercise also can reduce the risk of falls, increase bone density and improve overall physical function. In the United States, 80% of adults are not meeting key guidelines for both aerobic and muscle-strengthening activity. In general, adults should do at least 150 to 300 minutes a week of moderate-intensity aerobic physical activity or 75 to 150 minutes a week of vigorous-intensity aerobic physical
activity (or an equivalent combination of both). Preferably, aerobic activity should be spread throughout the week. COVID-19 restrictions and the intermittent closures of gyms and fitness classes have made it more difficult to participate in a fitness program. However, options for independent exercise do exist, including walking, biking, running, hiking, home Pilates/yoga and resistance training. When starting a program, you should find an activity that incorporates car-
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diovascular fitness, strengthening and stretching. These three components are important for improving strength and endurance and reducing the chances of injury. When first starting or restarting an exercise program, progression of weight/distance/intensity should be increased slowly. A slower progression of activity/strengthening will allow tissues (muscles, ligaments, tendons and bone) time to accommodate to the new activity and physical demands. Starting with lower-intensity activities and gradually increasing the intensity and duration also will increase strength and endurance. Some medical conditions necessitate medical supervision when starting or restarting an exercise program. Some of the medical diagnoses or situations that can require medical guidance for exercise include diabetes, arthritis,
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80%
of U.S. adults are not meeting the key guidelines for both aerobic and musclestrengthening activity.
pregnancy/post-partum, cancer recovery, cardiovascular issues and hypertension. You also should consult with your medical provider when starting an exercise program for the first time. If you have an injury, seeking the help of a physical or occupational therapist can assist in addressing any issues and may reduce the likelihood of sustaining additional injuries. Physical and
occupational therapists, all of whom have completed advanced education to become licensed in Washington, are trained to use a variety techniques to care for patients, including individualized exercise and stretching programs, manual therapy techniques and soft tissue mobilization, and pain-reducing modalities. ■ Jeannett Penner, DPT, OCS, GCS, is board certified as an orthopedic clinical specialist and a geriatric clinical specialist. She has advanced education in manual therapy, orthopedics, sports injuries, geriatrics and women’s health. Penner, who has been a licensed physical therapist in Washington state for 23 years started Capstone Physical Therapy with her husband in 2012. Capstone’s physical and occupational therapists and board-certified specialists help patients develop safe exercise programs and return to their active lifestyles. Capstone clinics are in Fairhaven, Barkley, Cordata, Ferndale, Lynden, Birch Bay and Blaine.
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The enduring value of community banks Kamyar Monsef Community banks are vital to serving the needs of local customers and communities, particularly in challenging times. As the COVID-19 pandemic has pushed consumers to adopt online banking in unprecedented numbers, some large national banks have responded by consolidating their retail operations and closing branches in small, rural communities. In areas left behind by these financial institutions, the role of community banks has become more important than ever. A focus on relationships: During the prolonged closure of our branch lobbies, customers lined up at our drive-thru locations to speak to their banker in person. They also took advantage of our online appointment scheduling to talk to trusted advisers by phone or videoconference and heavily utilized our call cen-
ter for assistance. Despite a wealth of online tools and services, some people prefer to seek an actual person for help or advice, especially in times of difficulty. For our customers, being available to serve them face-to-face — or through a real, local person at the other end of a phone or videoconference line — is a central part of community banking. Local expertise Because community banks have longstanding roots in the areas they serve, they often have a more nuanced understanding of the local economy, industry and market opportunity. The best community bankers live, work and play in the markets they serve, engaging the community and supporting banking relationships at a different level. It allows us to see each customer as unique — there’s no cookie-cutter approach — and we’re not viewing every interaction or application through a particular, more transactional
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During the first wave of the Paycheck Protection Program (PPP), community banks funded nearly 60% of PPP loans. model. In the current economy, local expertise is critical, and working with a bank that understands your potential and goals is essential. A vested interest During the first wave of the Paycheck Protection Program, community banks funded nearly 60% of PPP loans. We have a vested and very personal interest in our nation’s small businesses and rural communities’ success, vitality and fiscal well-being. Throughout the pandemic, community bankers have continued to serve on local boards, helping nonprofits and
other organizations overcome increasing challenges this past year. Together, as neighbors, businesses and bankers, we all thrive as our local community succeeds. A plan forward While personal relationships and local expertise will continue to define how banking services are delivered, community banks are also working hard to enhance customers’ online and digital experiences. The pandemic has resulted in more people using technology to safely conduct basic banking transactions and has driven early
technology adopters to use it more effectively and efficiently. Peoples Bank continues to invest in digital platforms and services, as well as enhanced security, to meet the growing needs of our customers. The financial landscape is changing, and it’s important for community banks to serve their markets in a very different way than our larger, national peers. This involves continually evaluating the requirements of the communities in which we operate to ensure we are meeting our customers’ specific needs. Our ability to provide local knowledge and forge non-centralized, personal relationships with our customers, many of whom span multiple generations, represents a unique value. Complemented by our ongoing investments in mobile and online banking tools and other services that deliver the safety and convenience sought by customers, community banks can succeed in doing what we were all called to do — serving the needs of our local customers and communities. ■ Kamyar Monsef is the chief retail banking officer at Peoples Bank. He is especially passionate about empowering, educating and developing the next generation of frontline bankers. For more information, visit https://www.peoplesbank-wa.com
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Legislature must act quickly to head off looming unemployment insurance crisis A 500% tax increase is a real possibility for Washington businesses Kris Johnson Before the state Legislature arrives for the 2021 session, some businesses in Washington will already be facing the very real prospect of a 500% tax increase. That’s on day one, before lawmakers even begin to talk about passing new taxes like an income tax, a capital gains tax or a tax on high-income earners. And it’s coming at a time when most employers can least afford it. The looming crisis is related to the state’s unemployment insurance system. This past spring, as the novel coronavirus began to spread, Washington shut down a significant portion of its economy, meaning hundreds of thousands of people became unemployed almost overnight. The state’s unemployment rate rocketed from 4.2% in February to 15.8% in April. About half of those jobs had returned by September — before another wave of layoffs was triggered by new restrictions imposed on businesses in November — but the impact on the unemployment system is unprecedented. By the
end of the year, officials estimate Washington will have paid out approximately $5.3 billion in unemployment benefits, compared to just $1.01 billion in 2019. This was before the November restrictions went into place. This is the system working as it is supposed to work. Lawmakers can jumpstart the recovery by not saddling employers with additional taxes and regulations at such a precarious moment. Washington’s unemployment insurance program is designed to be a safety net for workers who lose their jobs through no fault of their own. A global pandemic and the abrupt shutdown of major parts of the economy is certainly no fault of those who have become unemployed. But it’s also no fault of the businesses, and unless lawmakers take action to head off the looming crisis, it could be a disaster for many employers already struggling to survive. That’s because after paying out more than $5 billion
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If you and your business do not participate in the shaping of public policy, you will be governed by those who do.
The WBA Policy Center was created to be the eyes, ears, and voice for Whatcom County businesses. There are thousands of rules and regulations being created at the federal, state, and local levels that may harm local business. The WBA Policy Center provides both influence and credibility in the community by engaging in fact-based research, education, communication, and advocacy for its members on issues important to business. It also works proactively to advance policy issues that support business success, while advocating against those harmful to local business. We hope you will consider supporting the WBA Policy Center — there is strength in numbers and your support will have an impact.
Be Informed...Get Engaged...Make a Difference! How You Can Help • Contact us about issues that may be impacting your business or industry at wbapolicycenter.org/about-contact/. • Become part of the solution by making your contribution to the WBA Policy Center’s Step Up Fund. Your support makes it possible for WBA to proactively engage on issues on your behalf before they negatively impact your business.
START TODAY! Support the WBA Policy Center with a contribution at www.wbapolicycenter.org.
in benefits, it will soon be time to replenish the state’s unemployment insurance fund. And it falls entirely on employers to do the replenishing. For many businesses, this will mean dramatic increases in the amount they pay in unemployment insurance taxes. The numbers will vary based on industry, but it’s possible that a business could go from paying $50 per employee in unemployment insurance taxes to $277 per employee. This kind of increase will likely trigger more layoffs, leading to a downward spiral that puts even more strain on the unemployment insurance system and delays the economic recovery we desperately hope to see in 2021. The COVID-19 pandemic is both a public health crisis and an economic crisis the likes of which we haven’t seen in more than 100 years. Recent news about vaccine development is encouraging, but we don’t expect the recovery from either the public health crisis or the economic crisis to be immediate. One of the best ways that legislators can help employers is to follow the lead of doctors and seek first to do no harm. Hard-hit businesses will need help recovering from this once-in-a-century crisis. Lawmakers can jumpstart the recovery by not saddling employers with additional taxes and regulations at such a precarious moment. And they can provide a huge boost to struggling employers by heading off the looming unemployment insurance disaster. Lawmakers will be facing many challenges when they convene in January. Unemployment insurance must be at the top of their to-do list. Employers need assurance that help is on the way. ■ Kris Johnson is president of the Association of Washington Business, the state’s chamber of commerce and manufacturers association.
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Advocacy. Vibrant Economy. Committed to Business Success. Research. Leadership. Web Events. Non-partisan. Networking. Education. Community Prosperity. Join Us.
Facilitating Business Success and Community Prosperity. The Whatcom Business Alliance is the ears, eyes, and voice for the Whatcom County business community. We believe success is the single largest driver of community prosperity, which is why we focus our efforts on facilitating that success through advocacy, research and education and job opportunities. We bring business leaders together to encourage, acknowledge and share the best and most ethical business practices. Our members improve their respective businesses and work closely with community leaders to promote public policy that supports a healthy business climate and a vibrant economy. To learn more and become a member, visit whatcombusinessalliance.com/joinus or call Barbara Chase at 360.543.5637.
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