Crain's Cleveland Business

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Vol. 35, No. 12

Entire contents © 2014 by Crain Communications Inc.

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Anti-sin tax group starts to rumble Coalition proposes alternatives to Issue 7; backers say those options are flawed

By JAY MILLER jmiller@crain.com

It’s not a big tax and Cuyahoga County taxpayers have been paying it for 19 years.

But it is a big deal. And if a small, social-media-savvy band of citizens can sway enough voters, renewal of

the sin tax that has paid for the buildings that are the homes to Cleveland’s major-league sports teams will go down to defeat on the May 6 ballot.

The leaders of the anti-tax group, which calls itself the Coalition Against the Sin Tax, or CAST, consider themselves Cleveland boost-

ers and fans of the teams. They say Issue 7, the proposed 20-year sin tax extension, has been rushed to the ballot and they just don’t believe the sin tax is the best way to fund improvements to buildings that are owned by Cuyahoga County and the city of Cleveland.

They say the process that put the

sin tax on the ballot has not considered other alternatives for financing the repair and upkeep of the buildings; they also say citizens need more details about the capital improvements the teams want before they approve the continued spending of public money.

“The way that this has been

pushed through isn’t right, and if we reject the sin tax this May we will have another year to evaluate alternatives and to come up with a deal that is transparent and fair,” CAST chairman Peter Pattakos told about four dozen supporters at the group’s first organizational meeting last Wednesday, March 19, at the Market Garden Brewery in Cleveland’s Ohio City neighborhood.

See GROUP Page 24

Local businesses are slow to buy into Bitcoin’s value Digital currency has been described as just a ‘fad,’ but others believe it’s here to stay

By CHUCK SODER csoder@crain.com

Frank Revy admits he “might be losing product three dollars at a time” whenever he sells a cup of coffee to those very few people who pay with bitcoin.

His shop, coffeeproper in Lakewood, is one of a handful of local businesses that have decided to accept payments from people who use the controversial digital currency.

Bitcoins traded for almost nothing in 2010, when computers first started churning through the complex calculations needed to produce them. But that was then: Over the last year, the

GETTY IMAGES

IT’S NOT AS EASY AS YOU THINK Crain’s reporter Chuck Soder details his attempt to purchase a cup of coffee with bitcoin. Page 23 price of a single bitcoin blasted past the $1,000 barrier last November, before coming back into orbit. You could buy one for about $590 last Thursday, March 20.

Some merchants, such as The Wine Spot in Cleveland Heights, immediately convert any bitcoin they receive into cash. But not coffeeproper.

See BITCOIN Page 23

What is it? How does it work?

By CHUCK SODER csoder@crain.com

So, what the heck is Bitcoin? And does it really have a chance to compete against the almighty dollar?

We’ll start with the basics.

Bitcoin is a form of currency that isn’t issued by a central government. There also is no such thing as a physical bitcoin (the concept is capitalized, the currency is not). Computers are used to create them. Big computers: It takes a lot of horsepower to run the complex algorithms needed to produce a single bitcoin. Your laptop won’t cut it.

All those computers form a network that serves to confirm transactions made with bitcoin, without the help of Visa, MasterCard or your local bank. And the system is set up so that, over time, it becomes harder to produce new bitcoins, which is intended to keep inflation in check.

Merchants have at least one good reason to accept bitcoin: It allows them to avoid paying fees associated with credit card transactions. (However, merchants sometimes choose to pay a so-called “mining fee,” which tends to be lower than a credit card fee, to encourage people in the computer network to process their transactions quickly.)

See WORK Page 23

MCKINLEY WILEY

Frank Revy’s coffeeproper in Lakewood is one of a handful of Northeast Ohio businesses that accepts bitcoin.

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700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: John Campanelli (jcampanelli@crain.com) Editor: Mark Dodosh (mdodosh@crain.com) Managing editor: Scott Suttell (ssuttell@crain.com) Sections editor: Amy Ann Stoessel (astoessel@crain.com) Assistant editor: Kevin Kleps (kkleps@crain.com) Sports Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Energy, steel and automotive Tim Magaw (tmagaw@crain.com) Health care and education Michelle Park Lazette (mpark@crain.com) Finance Rachel McCafferty (rmccafferty@crain.com) Manufacturing and energy Research editor: Deborah W. Hillyer (dhillyer@crain.com) Cartoonist/illustrator: Rich Williams Art director: Rebecca R. Markovitz (rmarkovitz@crain.com) Events manager: Jessica Snyder (jdsnyder@crain.com) Special events coordinator: Kim Hill (kehill@crain.com) Marketing strategist : Michelle Sustar (msustar@crain.com) Advertising director: Nicole Mastrangelo (nmastrangelo@crain.com) Account executives: Dawn Donegan (ddonegan@crain.com) Andy Hollander (ahollander@crain.com) Lindsie Bowman (lbowman@crain.com) John Banks (jbanks@crain.com) Michael Jansen (mjansen@crain.com) Office coordinator: Denise Donaldson (ddonaldson@crain.com) Web Editor: Damon Sims (dpsims@crain.com) Digital strategy director: Nancy Hanus (nhanus@crain.com) Audience development director: Eric Cedo (ecedo@crain.com) Web/Print production director: Craig L. Mackey (cmackey@crain.com) Production assistant/video editor: Steven Bennett (sbennett@crain.com) Billing: Michele Ulman, 313-446-0353 (mulman@crain.com) Credit: Todd Masura, 313-446-6097 (tmasura@crain.com) Customer service/subscriptions 877-824-9373

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CRAIN’S CLEVELAND BUSINESS

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Aclara could fetch $150M

SOLD

Proposed sale follows layoffs at utility tech company; parent to write off sale as a loss

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Aclara, a provider of advanced metering technology for utilities, is scheduled to be sold for an amount that could reach $150 million, though its parent company still plans to write down the sale as a loss.

Aclara, which has 177 employees in Solon, is expected to be acquired

by Sun Capital Partners, a Florida private equity firm that among other things helps entities within corporations become separate companies.

In this case that corporation is Esco Technologies of St. Louis. The diversified maker of engineered filtration products put Aclara up for sale last August, saying that it wanted to pay down debt, finance acquisitions and focus on higher-margin lines of business.

Aclara’s business is a tough one.

The company, based in Hazelwood, Mo., sells meter-reading equipment and other technologies that help utilities monitor and manage the flow of electricity, water and gas. For years, Aclara has made some of those products in Solon, but last April it announced plans to lay off about 80 employees and outsource some of Solon’s manufacturing to its contractors.

Esco isn’t saying whether any manufacturing is still going on at that location, according to Kate Lowrey, director of investor relations

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for the parent company. However, Aclara employed 241 in Solon when it made the announcement last spring — meaning it has trimmed more than 60 people from its local staff. At the time, the company noted that its office staff in Solon would be retained.

Demand for so-called “advanced metering infrastructure” products is expected to grow over the long term, but the market for those products can be volatile. At Aclara, that volatility has come in the form of large contracts that can cause big fluctuations in the company’s sales. For instance, in 2011, Aclara struck a deal to install advanced metering infrastructure throughout the territory served by Southern California Gas Co. Now that Aclara is delivering products for that contract, its sales are way up: Aclara’s revenue jumped to $51.9 million in Esco’s fiscal first quarter, which ended Dec. 31, up almost 50% from $34.7 million during the yearearlier period. That spike helped Aclara move into the black: it earned $3.7 million in its latest fiscal first quarter, up from a $7.7 million loss during the like period a year earlier.

But those contracts come and go, according to Esco’s Lowrey.

Plus, sales cycles in the utility industry are “often unpredictable due to budgeting, purchasing and regulatory approval processes that can take up to several years to complete,” according to a statement in

Esco’s annual report for its most recent fiscal year, which ended on Sept. 30, 2013.

A loss in the offing Sun Capital plans to pay $130 million in cash for Aclara, and Esco has retained the right to another $20 million in receivables owed to Aclara, which had a total of 555 employees across its operations as of last September.

But Esco had listed Aclara’s value — its assets minus its liabilities — at about $195 million, according to its most recent quarterly report published in February. Esco said it plans to record the sale as a $50 million loss after the deal closes at the end of March.

Despite the expected loss, Esco CEO Vic Richey said in a statement that the sale represents “an exciting opportunity” for Esco to cut its debt and become “a more strategically focused, higher-margin business with a much steadier and predictable growth profile.”

It’s unclear what the deal might mean for Aclara’s Solon operations: Officials from Aclara would not talk about the deal, because it has yet to close. A representative from Sun Capital did not return a phone message left on Wednesday, March 19.

The private equity firm apparently is OK with taking on a challenge: Sun Capital’s website says it “focuses on companies that are operationally challenged, experiencing an industry or business transition, undergoing a corporate divestiture, or managing rapid growth.”

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Crocker Park hotel in the works

By STAN BULLARD sbullard@crain.com

Crocker Park in Westlake is closer to putting a long-sought hotel in the property mix at the retail, office and residential complex.

Stark Enterprises, co-developer of Crocker Park with the Carney family of Westlake, this year hopes to start building a six-story hotel and a 400space parking garage near Union Street between Crocker Road and the complex’s Regal Cinemas and Nordstrom Rack.

Steve Rubin, chief operating officer of Stark, said the developer plans a limited-service hotel with 112 rooms.

Stark is in final negotiations with a lender for the hotel’s flag and with lenders for the project, he said. Rubin declined to estimate the project’s cost, though he did say as many as five restaurants also would go into retail additions to that area.

Stark plans to seek approval soon from the Cleveland-Cuyahoga County Port Authority for a bond issue to finance the streets, sidewalks and other infrastructure for that component of Crocker Park’s expansion.

The city of Westlake authorized a tax increment financing agreement March 10 that would let a portion of the property tax payments go toward

repaying the bonds.

Crocker Park’s restaurants and stores can serve as an amenity for the hotel. David Sangree, president of the Hotel & Leisure Advisors consultancy in Lakewood, said few hotels in Cleveland’s suburbs have such a mixed-use complex as an amenity, although it is a common combination elsewhere.

“It would be a big competitive advantage compared to the other

“Ever since we opened, we’ve had people asking if we would add a hotel.”

– Steve Rubin chief operating officer, Stark Enterprises hotels,” Sangree said. “Guests can park once and walk to shopping and dining.”

Westlake Mayor Dennis Clough said Stark has been pursuing the hotel project separately from the pending second phase of Crocker Park on its south side. That phase is slated to include a new headquarters for Brooklyn-based American Greetings as well as more retail space and apartments.

The mayor said the city expects to

Volume 35, Number 12 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of December and fifth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2014 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373.

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issue bonds “within weeks” for infrastructure for the second phase.

However, the city decided it did not want to fund the Union Street additions on Crocker Park’s north side with its own bonds, so Stark will take that financing component to the port authority.

“It came down to the city only wanting to issue $48 million for Crocker Park and American Greetings,” Clough said. “We opted just to stop at that level.” He estimated the public infrastructure associated with the hotel, garage and retail space on Crocker Park’s northeast corner will require a port bond issue of about $6 million.

A hotel has been in the game plan for Crocker Park since 2005. Rubin said the hotel originally was going in on what now will be the American Greetings side of the complex.

Instead, the hotel will go in on the north side, closer to the Interstate 90 interchange.

Rubin said surveys by Stark’s hotel consultant show demand for another hotel in the suburb. However, its strongest market survey came from shoppers and visitors to the 1 millionsquare-foot property.

“Ever since we opened, we’ve had people asking if we would add a hotel,” Rubin said.

■

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MARCH 24 - 30, 2014

WWW.CRAINSCLEVELAND.COM

CRAIN’S CLEVELAND BUSINESS

5

Software provider getting plenty of notice Akron’s Knotice is acquired by N.Y. firm with 350 employees

By CHUCK SODER csoder@crain.com

The 70 people who work for Knotice are now part of another marketing technology company, one that should help the Akron-based software provider make the most of a big opportunity.

Knotice has been acquired by Ig-

nitionOne, a company based in New York City with about 350 employees. Terms were not disclosed.

The deal should give Knotice — which years ago received financing from JumpStart, a Cleveland nonprofit that provides assistance to local entrepreneurs — the resources to capitalize on a sudden boost in demand for the company’s tech-

nologies, according to president and CEO Brian Deagan, who will continue on in a management role with the combined business.

Only recently has the marketing sector started to understand the potential of Knotice’s technology, Deagan said. The company’s software allows marketers to send messages to consumers through multi-

ple platforms, including websites, email and mobile devices, and analyze consumer data.

The 13-yearold company grew from nine Deagan employees in 2006 to 88 by the start of 2012. However, its growth was tempered because the company created its data man-

Garage next door provided opening

See KNOTICE Page 6

INSIGHT

Case says law school remains in ‘fine shape’

Gent Machine made room for expanding business by buying school bus building

Applications rise despite turbulence and another change in dean’s position

By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com

It took about 18 months, nearly $500,000 and plenty of paint for Gent Machine Co. of South Euclid to turn an old bus garage into a modern manufacturing plant.

Today, instead of school buses, the 10,000-square-foot building houses seven Swiss-style CNC (computer numerically controlled) lathes for Gent Machine. The maker of screw machine parts had been a staple in South Euclid for 70 years when it started to outgrow its 15,000-square-foot plant at 445 South Green Road, right next to the bus garage.

“It became very apparent very quick” that the company needed more space, said president Rich Gent, who owns the company with his brother, vice president Adam Gent.

Gent Machine primarily uses CNC lathes and Davenport brand five-spindle screw machines to turn materials such as steel, aluminum and brass into screw machine parts used by automakers and producers of specialty fasteners. In 2009, Rich and Adam Gent bought the 87year-old, family-owned business from their father, who still owns a minority share.

Rich Gent said the company saw a dip in business during the recession, but has been growing steadily since mid-2009, which led to the need for expansion in 2011.

That need intensified in 2012 when Gent Machine signed a major customer, which Rich Gent declined to identify.

In 2013, revenue was up 60% from 2012, and the company added 11 jobs. Today, Gent Machine has 44 full- and part-time employees, not including the owners. Its annual sales are more than $5 million, although Gent declined to be more specific.

Gent said he had been looking

agement platform in 2008 — long before the marketing sector understood what it was, Deagan said. He cited a quote from Amazon founder Jeff Bezos, who has said that innovators need to be willing to be misunderstood for long periods of time.

“We were working on something that the market wasn’t necessarily ready for, nor did we have the funding to change hearts and minds,” Deagan said.

By MICHELLE PARK LAZETTE mpark@crain.com

Though its dean’s resignation this month marked the second time since 2008 that a leader of Case Western Reserve University School of Law has left amid some form of conflict, one of the school’s now-interim deans sees the state of the program this way: “We’re not the Cleveland Browns.”

In making that statement, Michael Scharf means a leadership change at a Scharf law school doesn’t have the domino effect that management shakeups at National Football League teams do, as new coaches and general managers almost always hire their own people.

INSIDE: A look at the tenures of law school deans at Case Western Reserve University, Cleveland-Marshall College of Law and the University of Akron.

Page 14

share the space for a year, starting in the summer of 2012. The city agreed to sell the garage to Gent Machine for $200,000, and the company quickly got to work transforming the space.

“At a law school like ours where the faculty plays such an important role, the kinds of continuity we have in our staff and in our faculty leaders has enabled us to continue to move forward through our leadership changes,” said Scharf, who with Jessica Berg went from being acting deans to interim deans when Lawrence E. Mitchell resigned effective March 1.

Prior to resigning, Mitchell had been on a leave of absence since last November after he and the university were sued in October by a law school professor who said Mitchell retaliated against him after the professor reported alleged sexual harassment of women by the dean. Mitchell had been dean since June 2011.

See GARAGE Page 8

See CASE Page 14

JANET CENTURY

Gent Machine Co. president Rich Gent, right, said it “became very apparent very quick” that the company needed more space. He owns the business with his brother Adam. for new space in and out of South Euclid when the city-owned garage next door came to mind. Euclid economic development director Michael Love said Gent Machine was one of the city’s longesttenured businesses, and it wanted

to keep the company — and its jobs — in the city. But a lot went into making that happen.

Gent Machine and the South Euclid-Lyndhurst schools, which had been leasing the bus garage from the city, reached an agreement to

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CRAIN’S CLEVELAND BUSINESS

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After spending two years in foreclosure, the Sterling Building was transferred to a lender led by Dallas-based Lone Star Funds on March 17. Mark Munsell, one of the building’s owners, said it was the only “amicable solution” he could reach.

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Sterling Building put under lender’s control

By STAN BULLARD sbullard@crain.com

Bought from a lender 13 years ago, the Sterling Building in Cleveland’s Theater District is in a lender’s hands once again, although it’s a different lender this time around.

Real estate owner and developer Mark Munsell, who led an investor group called Sterling Telecom Office Building LLC that had owned the building at 1255 Euclid Ave., transferred it to the lender March 17.

The move settled a 2-year-old foreclosure suit in Cuyahoga County Court of Common Pleas. Now a tech-focused office building, the structure dates from 1909 and once was the home of the old Sterling Lindner department store.

The new owner is led by Lone Star Funds, a Dallas-based fund that invests in commercial real estate by buying distressed mortgages.

Munsell said in a March 19 interview he is disappointed with the outcome, but it was the only “amicable solution” he could reach.

“In today’s financing environment, we could not find someone

who would refinance the property,” he said.

The foreclosure was launched after the $8 million loan that the Munsell group had used to buy the building in 2001 came due in 2011.

The Cleveland office of real estate broker CBRE Inc. took over management and leasing of the building for Lone Star’s asset manager, Hudson Americas LLC, when the property changed hands.

“In today’s financing environment, we could not find someone who would refinance the property.”

– Mark Munsell real estate owner, developer Kenny Coven, CBRE managing director for asset services, said the firm’s immediate task is getting its hands around the building and boosting its 84% occupancy level.

Coven said Lone Star typically sells distressed properties after a period of time, and CBRE will handle the assignment when Lone Star orders that step. Because of its tech tenants and data center capability, the building will garner multiple bidders as interest in Northeast Ohio is high among groups seeking such

properties, he said.

Munsell said he was attracted to the property because of the presence on Euclid Avenue of the fiber optic lines that tech companies prize.

When Sterling Telecom bought the structure from Mony Life Insurance Co. of New York, the 196,000square-foot building was 90% occupied. However, after the 2001 terrorist attacks sparked a business downturn, occupancy fell to 43% and Munsell’s company, Munsell Realty Advisors, went into rebuilding mode.

The building provided Munsell, who primarily owns and develops office buildings in suburban Akron, Cleveland and Dayton, his first access to the downtown market in Cleveland. Despite the bruises he suffered as he exits the Sterling Building, Munsell said he considers downtown a more attractive market than it was in 2001.

When Munsell’s group bought the property, Euclid Avenue was described as bedraggled, far different from its condition today.

“It’s gorgeous now,” Munsell said.

“I am an opportunist. When an opportunity arises, I’ll consider it.”

Michael Shuster, the Cleveland attorney who represented the lender in the case, declined comment.

Three calls to the new owner were not returned by 1 p.m. March 20. ■

Knotice: New owner plans to grow locally continued from PAGE 5

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The market for Knotice’s technology picked up significantly last year, especially after technology research firm Forrester released a report listing the company among seven of the top data management platform providers in the marketing business.

IgnitionOne saw that report, as did other companies in the industry, Deagan said.

“That put us on the radar of a lot of people,” he said.

Knotice’s technology should complement IgnitionOne’s capabilities, Deagan said. The acquirer focuses more on helping marketers buy digital advertising and manage marketing efforts related to display ads, search engines and social media. Knotice’s data management platform will be

used to analyze a lot of the information IgnitionOne collects, Deagan said.

Acquiring a culture, too Besides Knotice’s technology, IgnitionOne liked that the company seemed to have an entrepreneurial mindset, said IgnitionOne CEO Will Margiloff.

“They’ve built an incredible culture there,” he said.

JumpStart provided Knotice with $500,000 in financing in 2006. Midway through 2010, the company finished paying back JumpStart’s money, with interest. JumpStart’s investment never converted to equity because Knotice didn’t raise outside financing.

“The JumpStart investment came at a very important point in the growth of the company,” Deagan said.

Knotice’s largest shareholders are Deagan, chief technology officer Bill Landers and Jon Grimm, chief financial officer and chief operating officer.

Deagan said he expects Knotice’s Akron office, which houses more than 60 people, to serve as a technology development hub for IgnitionOne. The office will continue to grow, Margiloff said, noting that IgnitionOne should be able to help Knotice recruit people.

“I think this will maybe raise the profile of the company a bit,” he said.

■

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

MARCH 24 - 30, 2014

Crain’s wins two Neal Awards Honors were for ‘CLE 2030’ section and commentaries Aggressive Financing up to 10M! Where are you going?

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Crain’s Cleveland Business has been honored with two awards in the 60th annual Jesse H. Neal Awards, a national competition staged by ABM, The Association of Business Information and Media Companies, that each year honors the best work in business media.

Crain’s won in the category of Best Cross-Platform Package for its July 22, 2013, special report, “CLE 2030: Facing the Future.� It is the second straight year Crain’s has won in that category, which recognizes publications for reporting that combines print, online and multimedia components of coverage.

CLE 2030 analyzed the importance of the urban core to Northeast Ohio and put into perspective various efforts to move the city for-

Bennett

Dodosh

ward. The package was spearheaded by sections editor Amy Stoessel.

Others involved in the project were reporters Tim Magaw and Jay Miller, freelance writer Dan McGraw, video editor Steve Bennett and freelance photographer Marc Golub.

Crain’s also won in the category of Best Commentary for three editorials penned in 2013 by editor Mark Dodosh.

In commenting on the honors, Crain’s publisher John Campanelli said, “The Neal Awards, which are often called the ‘Pulitzer Prizes of business journalism,’ are a true indication of editorial excellence. No

Magaw

Miller

other publication in Ohio was honored with a Neal Award, and our newsroom brought home two. That says plenty about the work Stoessel being done day in and day out by our reporters and editors. Our editorial staff continues to deliver the outstanding coverage our business community deserves.�

Stoessel accepted the awards at a March 14 awards luncheon in New York City. â–

Coming Soon! Minority-Owned Business Directory

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Garage: Company secured county loan continued from PAGE 5

It painted the building, installed new lighting and electrical work and turned a long-empty salt storage space into a high loading dock.

Gent Machine also built a hallway to connect the two previously adjacent buildings. The school buses moved out last summer, and the expansion officially was complete in December.

The building needed a lot of work, Gent said, but he knew staying in the same place would help the company save on moving costs.

And the sale came with two acres if the company needs to expand in the future.

Gent Machine was able to secure a $178,000 redevelopment and modernization loan from Cuyahoga County. When the loan came together and the city agreed to sell, “it started to make financial sense,�

Gent said. The company put an additional $100,000 in renovations in the building on top of what the county loan financed. Gent Machine also received a traditional loan for the purchase of the building.

Nathan Kelly, deputy chief of staff to Cuyahoga County Executive Ed FitzGerald, said while attracting new businesses to the county gets attention, helping existing businesses expand is critical. “Our bread and butter, the way to advance our economy, is in expansion,� Kelly said.

The loan for Gent Machine came from the county’s Western Reserve Fund, a local fund for economic development launched in 2011. The $100 million fund is used to invest in entrepreneurship and small business development, business attraction, and modernization by ex-

“Our bread and butter, the way to advance our economy, is in expansion.� – Nathan Kelly deputy chief of staff to Cuyahoga County Executive Ed FitzGerald

isting companies. Some of Gent Machine’s loan can be forgiven in exchange for creating up to 15 jobs, Gent said.

The brothers expect 2014 to be a bit quieter than 2013, but Gent said he still predicts about 5% growth in revenue. He intends to hire about three more skilled machinists and plans to focus on becoming more efficient in the expanded plant. “For us, this is kind of a year to catch our breath,â€? he said. â–

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CRAIN’S CLEVELAND BUSINESS

9

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BEACON FINANCIAL PARTNERS: Candice Clark to client relations coordinator.

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MANUFACTURING LIBRA INDUSTRIES: Tom Dykeman to vice president, sales and business development.

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FIELDSTONE FARM THERAPEUTIC RIDING CENTER: Thomas Rathbone to chairman; Allen K. Wiant to president; T. Rodney Twells to vice president.

ROCKY RIVER PUBLIC LIBRARY: Audra Bednarski (River Snow Management LLC) to president; Jean M. McQuillan to vice president; Patrick Burke to secretary.

GREEN BRIDGE REAL ESTATE: John Lamb to commercial real estate specialist.

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CRAIN’S CLEVELAND BUSINESS

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MARCH 24 - 30, 2014

PUBLISHER/EDITORIAL DIRECTOR:

John Campanelli (jcampanelli@crain.com) EDITOR:

Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:

Scott Suttell (ssuttell@crain.com)

OPINION

Let it be

T

he Ohio Department of Taxation describes the state’s Commercial Activity Tax as “an annual tax imposed on the privilege of doing business in Ohio.” But with Gov. John Kasich recommending that the Legislature raise by 15% the tax known by the acronym CAT, businesses are likely to feel it’s more a pain than a privilege to do business in the Buckeye State.

The CAT was the wise creation last decade of another Republican governor, Bob Taft, who sought a more equitable way to tax business in Ohio. Taft convinced the Legislature to phase out the corporate franchise tax and the personal property tax, which hurt manufacturers in particular because the tax applied to tangible assets such as plant and equipment, and to put the CAT in their place.

Taft’s goal was to implement a tax with a low rate that would apply to a broad base of businesses. In this way he’d spread out the tax load while keeping the tax from becoming burdensome. And so, in mid-2005 began the CAT, which taxes the taxable gross receipts from most business activities at a rate of 0.26%.

Because the CAT is based on receipts, not profits, it wasn’t love at first sight for businesses that previously avoided much of a tax bill because their bottom lines routinely were in the red or marginally in the black. However, the tax steadily has won acceptance in business circles and even has caught the eye of other states for possible imitation.

Now, Kasich wants to raise the CAT’s rate to 0.30% in order to help produce enough new revenue to offset tax money that would be lost if lawmakers enact an 8.5% cut he’s seeking in personal income taxes over the next three years. An increased CAT would cost businesses another $743 million in taxes over the next three years, according to Kasich’s office.

The move to raise a tax on business might have been expected from a Democratic governor, not a Republican such as Kasich. Regardless, the potential for a rate hike was a concern back at the CAT’s inception, according to Greg Lawson, statehouse liaison and policy analyst for the Buckeye Institute, a conservative public policy think tank.

“The whole fear was that because it’s such a small rate, it’s an extraordinarily tempting target” for an increase, said Lawson, who was a legislative aide when the CAT was devised.

Kasich talks up Ohio as a business-friendly state, but his actions can be inconsistent with his words.

Last year, he convinced the Legislature to raise the regressive sales tax a quarter point, which makes selling anything more expensive. Now he wants to increase Ohio’s most basic tax on business.

We might understand the governor’s insistence on raising taxes on business to cover the cost of reducing income taxes for the third time in 10 years if the public was clamoring for more tax cuts. But no such groundswell exists.

Unlike Florida, Ohio won’t get its income tax to zero, and it won’t hold on to wealthy snowbirds who head south to escape our winters no matter how low top tax rates go. So why engage in this headlong dash to cut income taxes at the risk of alienating employers and losing jobs by raising the CAT? Just let it be.

FROM THE PUBLISHER

Honesty remains the best policy vealed that his fund had shortill Ackman scares the JOHN ed $1 billion of Herbalife bejesus out of me.

Ackman is a billion- CAMPANELLI stock.

I have no problem with aire hedge fund manAckman seeing a potential opager. But he also spends part portunity and shorting a of his time doing a great imstock. Short-selling is crucial pression of Glenn Close in to the balance and integrity of “Fatal Attraction.” the stock market. But what If you saw that 1987 film you Ackman has done since gives certainly remember it. me the willies. He’s now made Michael Douglas plays a sucit his obsession to destroy the cessful, married lawyer who company. It’s as if he bet has a steamy weekend affair against a team … and is now working to with Close. He believes it was a simple break the legs of the players. fling; she believes it was something He has paid lobbyists more than more. She then pursues him, and when $260,000 to build a case against Herbalhe rejects her, she pretty much makes it ife in Washington. He’s paid civil rights her mission to destroy his life, even boilorganizations (he accuses the company ing his family’s pet bunny. of targeting minorities) more than Like Douglas’ character, Herbalife, a $5 billion multilevel marketing company $130,000 to help in the cause. He’s orgadealing in vitamins and energy drinks, nized letter-writing campaigns and paid doesn’t come off as exactly an angel. The activists to attend anti-Herbalife rallies. company has been criticized for preying “I am going to personally pursue the on its own customers — its “representaHerbalife matter to the end of the earth,” tives” — while top management and inhe said. vestors get rich.

Earlier this month, the Federal Trade In late 2012, Ackman called Herbalife Commission announced it was opening “the best-managed pyramid scheme in an investigation into Herbalife. Its stock the history of the world.” He then refell 15%.

B

Regardless of whether Herbalife is honest or shady, Ackman’s unprecedented antics should scare anyone in business.

These days, anyone with a grudge against you or your company — an angry customer, a disgruntled employee, a competitor — can become a nuisance. If the grudge develops into a full “Fatal Attraction,” look out. All a person needs is the time and the Internet.

So, can we somehow protect ourselves from this kind of sabotage? I asked Scott Chaikin, CEO of Dix & Eaton, who has some expertise in crisis communications.

Figure out your vulnerabilities, he says, and develop a strategy to shore them up. Where are people interacting with your company? What’s the experience like? How can it be improved?

Also, invest in your reputation now.

Your business should have an honest and authentic story to rally around. You should have advocates eager to tell that story at a moment’s notice.

Perhaps most obvious, Chaikin says you need to be able to say that you are running a good, trustworthy business.

That means no pyramid schemes, no dishonesty and no bunny soup.

■

TALK ON THE WEB Re: Hard Rock Rocksino ■ Downtown, Flats, East 4th, Quicken Loans Arena and PlayhouseSquare are all excellent for the greater area entertainment scene, but for those who do not care to go downtown but want to see concerts, then the Rocksino offers a good alternative.

If it were not for the Rocksino, those concert entertainment dollars would likely go unspent in the local economy.

The Rocksino is capably filling a void.

— Jim Daniloff ■ In your March 17 story on the Hard Rock Rocksino, Cindy Barber, co-owner of the Beachland Ballroom concert club in Cleveland’s Collinwood neighborhood, said the Rocksino seems to be an appropriate venue for what she called soft-ticket acts that have played casinos

Reader responses to stories and blogs that appeared on: www.crainscleveland.com

for years.

AWWW! Poor Barber. These are sour grapes from a worried owner of a competitor, who isn’t even paying attention.

The article neglects to mention such Alisters as Jennifer Nettles, who is not a “soft ticket act” but has played the Rocksino.

I’m not sure how many 20/30-something stars who have “played casinos for years” are now packing the Hard Rock that Beachland Ballroom is shrugging about. I am sure things are poppin’ over there in Collinwood for the rock and country music spenders.

— IZZN See WEB Page 11

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CRAIN’S CLEVELAND BUSINESS

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11

PERSONAL VIEW

Proposed tax on miles traveled by vehicle shouldn’t fly in Ohio

By HOWARD A. LEARNER

Learner is executive director of the Environmental Law and Policy Center, an environmental and economic development advocacy organization with offices in Illinois, Ohio and other Midwest states.

G

as tax revenues are declining, as people drive less and more fuel-efficient new cars require filling up less at the pump. That saves people money, reduces pollution and lessens America’s imports of foreign oil. However, less driving and more fuel-efficient vehicle technologies produce less funding for needed transportation infrastructure improvements that are vital to Ohio’s economic growth, public health and safety.

Many politicians oppose raising the motor fuels taxes. So some states, like Oregon, are looking to shift from gas taxes to vehicle miles traveled (VMT) taxes, which charge motorists based on how many miles they travel on the roads. An onboard vehicle device, using GPS or other technology, records the distance driven, assigns it to the appropriate taxing jurisdiction, and calculates the tax amount owed.

Proposed new federal legislation (H.R. 3638) would establish a “Road Usage Fee Pilot Program,� namely vehicle miles traveled taxes. However, this approach doesn’t work well in practice in Ohio and similarly situated states with the interstate highways that are the nation’s crossroads used by millions of outof-state drivers each year.

First, Ohio’s interstate highways are a crossroads of America — that’s different than coastal Oregon. Changing to VMT taxes here would mean out-of-state drivers

who now pay Ohio gas taxes on their fuel purchases while using Ohio highways — Interstate 70, 71, 77, 80 and 90 — would instead get a free ride as they travel through.

Meanwhile, Ohio drivers would be forced to pay the entire VMT tax burden. This shift is disadvantageous and unfair to Ohio motorists and taxpayers. Why would Ohio legislators want Ohio taxpayers to further subsidize highway use for out-of-state motorists?

Second, VMT taxes would effectively penalize fuel-efficient cars, such as Honda Accord hybrids manufactured in Marysville and the Chevy Cruzes manufactured in Lordstown.

Why should a gas-guzzling Hummer, which causes much more wear-and-tear on the highways, pay the same VMT tax as a lighter, fuelsipping car? Will heavy trucks pay their higher fair share?

The Congressional Budget Office’s March 2011 report, in comparing gas taxes and VMT taxes, emphasized the disproportionately high road wear from cargo trucks compared to what’s recouped by current gas tax levels: “Heavy trucks travel less than 10% of all vehicle miles, but their costs per mile are far higher than are those for passenger

vehicles, and they are responsible for most pavement damage.�

CBO suggested that VMT taxes, if adopted, should be adjusted to recognize weight-per-axle in properly allocating highway wear-and-tear to the cost causers, which are disproportionately heavy trucks and larger commercial vehicles.

Third, VMT taxes would penalize modern new clean electric vehicles and hybrid cars that pollute much less than internal combustion engine and diesel cars and trucks, and thereby provide air quality, public health and other environmental quality benefits for everyone. Creating positive incentives for clean electric vehicles and hybrids makes more sense, as Clean Fuels Ohio points out in its EV Readiness Plan for Ohio.

Fourth, the current gas tax is simple and inexpensive to administer at the pump. The system is already in place. The VMT tax requires that fairly costly new technology be installed in vehicles, and a new administrative system be created. The costs of operating and auditing a VMT system are higher than collecting gas taxes.

If legislators are reluctant to raise gas taxes, then why would the proposed VMT taxes be any more popular with the public?

The gas and motor fuel taxes are both fairer and practically better suited to Ohio’s geography and needs. For Ohio, the proposed VMT tax for cars is not the right tool to address transportation infrastructure funding challenges. â–

Web: Blazek’s response was ‘small-minded’ continued from PAGE 10

Re: Kelly Blazek and LinkedIn â– Those of us who have been using LinkedIn effectively for (in my case almost a decade now) years, often get request links from others we do not know. Most often we share some interest or possible opportunity together.

I do ignore requests from places like Abu Dhabi when the requestor only has 10 connections, but would never deny a request to someone just because I don’t know them! If some mindful young professional sent me a request for help to connect to someone to secure a position, it’s unfathomable to me why someone would not grant it, especially if they claimed to be some sort of superstar connector on a job board.

I can’t tell you how repugnant, small-minded and selfish Blazek’s response was to that young woman.

I do detest the stain it leaves on our community. We are not all like her! — Ron Copfer

Re: John Kasich, tax shifter ■ALL taxes paid by smokers should be used either for Health and Human Services issues, or to help the smokers find ways to quit. It is illogical and ethically wrong for any government agency to make money off of death. — Jerome Masek ■Get off it, Kasich. NO NEW TAXES! — Henry ■To people like “Henry� calling for “NO NEW TAXES:� Can we assume

you won’t be complaining about school districts needing to increase property taxes? You have no problem with the roads in horrible condition? You want a Libertarian/Tea Party paradise?

Move to Somalia. There’s no government to get in your way there. — Tom Burnett ■I am no proponent of further income tax cutting — our schools and city governments have been punished enough, but what exactly is the uproar over increasing the cigarette tax?

Because it unfairly targets those with low incomes? So, we should take it easy on those who elect to pursue a filthy habit that makes all of our health care premiums skyrocket? We can do better than that. — Jeff Desmond

GET DAILY NEWS ALERTS FROM CRAIN’S !

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Tri-C has high hopes for hospitality program Incoming associate dean believes college can be bridge to nation’s top culinary schools

K

laus Tenbergen has a tall order for Cuyahoga Community College’s hospitality management program, which he’ll be overseeing as its associate dean beginning in June. “What are the top three culinary schools in the country?� Tenbergen asked rhetorically. “Johnson & Wales, Culinary Institute of America and I’d say Kendall College. I want people to immediately think of Cleveland� as the heavyweight of associate degree programs that bridge ambitious students to those top-tier culinary schools, he said. “We want to build the program so its graduates are prepared to either continue their education or able to serve as the next leaders in any variety of hospitality and culinary professions,� Tenbergen said.

The certified master baker and executive pastry chef has more than 30 years of industry experience to prepare him for the task.

Tenbergen most recently served at California State University, Fres-

KATHYAMESCARR

WHAT’S COOKING no, as director of its culinology program, which blends the study of food sciences and culinary arts. He earned a bachelor’s degree from Kendall College in Chicago, where he served as department chair of the baking and pastry degree program; a master’s degree in management from Cardinal Stritch University in Milwaukee; and a doctorate of education from California State University.

At Tri-C, the German-born chef will join Brandt Evans, chef and coowner of Blue Canyon Kitchen and Tavern in Twinsburg and Pura Vida

in downtown Cleveland’s Public Square, who in December filled the hospitality management program’s newly created role of executive director.

The chef-administrators both plan to further connect the program, which has about 550 students, with the region and state’s tourism, hospitality and culinary sectors. According to state employment projections, leisure and hospitality employment in Ohio will grow by 4.3% between 2008 and 2018, behind construction, professional services, and education and health services.

Part of bolstering Tri-C’s hospitality management program involves improving its completion and job placement rates, which both chefs qualify as “low,� though neither they nor the school were able to quantify that assessment by deadline.

Crain’s asked the chefs to outline how they plan to improve those rates and expand upon other priorities.

Klaus Tenbergen: Q: Do you have any plans to integrate your culinology approach into Tri-C’s hospitality management

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Beginning in June 2014, Klaus Tenbergen will oversee Cuyahoga Community College’s hospitality management program as its associate dean. program?

A: Not necessarily. There will be a period of evaluating what the needs of the students are, the faculty’s capabilities and the industry’s needs.

(Lodging and) tourism is the program’s smallest degree option (next to culinary arts and food service management), but has potential to grow given downtown Cleveland’s recent economic and tourism growth. We may establish other degree options.

Q: What are some of your initial goals?

A: I want to increase the number of (partnerships) with other fouryear schools, so our students have the ability to lead food-related businesses and make higher salaries. I also want to focus on improving our students’ professional development. Two-week study programs in California or Chicago would certainly be one way to broaden their horizons.

Q: What are some of the ways you’re helping to improve the completion and job placement rates?

A: This is key. Sometimes students start working in the field making $12 an hour, working 16-hour days, then don’t have time for school and drop out. They don’t see the point of going to school and making minimumwage salaries. Our goal is to articulate with local employers that their job is part of their schooling, like a paid internship. I’d like to establish a mentorship program with food-related business owners to work closely with students. Part of this may also involve creating an advisory board, with key players from national food service providers, sports venues, hotel associations and restaurants as a way for businesses to work closely together and connect students with employment opportunities.

Brandt Evans: Q: What are some specific ways in which you’re helping to improve the completion and job placement rates?

A: Our goal overall is completion, completion, completion. Some of our students who come in don’t excel at math and English, so it takes them longer to complete the program. We’re ramping up our number of tutors to help. We also are bringing in more big-name chefs, from Dante Boccuzzi (Dante), Jonathon Sawyer (Greenhouse Tavern), Doug Katz (Fire Food and Drink), Eric Williams (Momocho),

Karen Small (Flying Fig) and Matt Fish (Melt Bar & Grilled), to do demos and talk about real-life situations so our students know what to expect when they look for a job.

Q: Talk about some of the initiatives you’ve undertaken as executive director.

A: My role is to be the bridge between the program and the community.

I’m working on furthering our partnerships with those in the hospitality, tourism and restaurant industries to let them know our students can be Evans their next employees. We get a lot of requests for our students, but we want to focus on channeling them to the position that best suits them. I’ve had a handful of meetings with the (general manager) of the new 9 hotel who will have a need for 350 employees. If a student has an interest in entering the restaurant industry, I don’t want to send (him or her) to a restaurant and that’s it. Their personality may be geared more toward a Dante restaurant or with Jonathon Sawyer. My connections with these chefs can help place them more strategically. I’m also focusing on developing our articulation program by partnering with schools that have bachelor’s degrees, like Kent State University and Johnson & Wales.

Q: What opportunities does the hospitality management program provide for graduates?

A: Your degree could lead to so many types of jobs. You don’t have to be an Iron Chef on the Food Network. You can become a nutritionist with the Cleveland Clinic, a chef at Stouffer’s, own your own catering business, be a food writer or a food scientist. Our biggest challenge in the industry, though, is filling cook positions at restaurants.

Local morsels â– Spice Kitchen + Bar’s Carthusian Sazerac, concocted by bartender extraordinaire David Hridel, was featured in a Saveur March 7 cocktail feature. “I was seduced by a bewitching green lady,â€? the writer says of the drink. “I felt buoyed up by the lilting, balanced marriage of what I later discovered to be rye whiskey, green chartreuse, lemon bitters and just the barest hint of absinthe.â€? â– Cleveland-based Orlando Baking Co. just rolled out two whole grain breads under its True Grains product line. The honey grain and purple wheat raisin breads bear the Cleveland Clinic’s Go! Healthy mark for foods that meet stringent national nutrition guidelines. The honey grain bread contains 24 milligrams of DHA omega-3 per serving, which Orlando says promotes cardiovascular health and brain and eye development. The purple wheat raisin is a sweet, nutty-tasting low-fat bread that contains antioxidants. The breads are $3.99 per loaf and available at Heinen’s, Whole Foods, Giant Eagle and other area grocers. â–

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CRAIN’S CLEVELAND BUSINESS

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13

TAX LIENS The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorder’s Office. The IRS files a tax lien to protect the interests of the federal government. The lien is a public notice to creditors that the government has a claim against a company’s property. Liens reported here are $5,000 and higher. Dates listed are the dates the documents were filed in the Recorder’s Office.

LIENS FILED J & J Enterprise Services Inc. 6491 Pebblecreek Drive, Independence ID: 54-2108723 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $240,400 Handl-It Inc. 5386 Majestic Parkway, Suite A, Bedford Heights ID: 34-1700605 Date filed: Feb. 7, 2014 Type: Employer’s withholding, unemployment Amount: $208,496 Handl-It Inc. 5386 Majestic Parkway, Suite A, Bedford Heights ID: 34-1700605 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $201,270 J & J Enterprise Services Inc. 6491 Pebblecreek Drive, Independence ID: 54-2108723 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $153,544 J & J Enterprise Services Inc. 6491 Pebblecreek Drive, Independence ID: 54-2108723 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $114,847 J & J Enterprise Services Inc. 6491 Pebblecreek Drive, Independence ID: 54-2108723 Date filed: Feb. 7, 2014 Type: Employer’s withholding, unemployment, corporate income Amount: $87,209 Ake Environmental & Construction & Service Inc. 503 Broadway, Bedford ID: 34-1129970 Date filed: Feb. 6, 2014 Type: Employer’s withholding Amount: $75,406 Bidder Transport Inc. 3565 Glen Allen Drive, Cleveland Heights ID: 34-1554376 Date filed: Feb. 6, 2014 Type: Employer’s withholding, unemployment Amount: $70,787 Practice Management Consultants LLC 20006 Detroit Road, Suite 200, Rocky River ID: 75-2995645 Date filed: Feb. 6, 2014 Type: Employer’s withholding, unemployment Amount: $58,359 Dan Morell & Associates Co. LPA 6060 Rockside Woods Blvd., Independence ID: 34-1732795 Date filed: Feb. 6, 2014 Type: Employer’s withholding Amount: $49,466 BTA Collision LLC 27500 Lorain Road, North Olmsted ID: 27-1626005

Date filed: Feb. 7, 2014 Type: Employer’s withholding, corporate income Amount: $45,243 Kelly Restoration 2166 Warren Road, Lakewood ID: 34-1702016 Date filed: Feb. 13, 2014 Type: Employer’s withholding, unemployment Amount: $45,087 Interactive Search Group LLC 35104 Euclid Ave., Suite 303, Willoughby ID: 27-0961280 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $42,892 ISG Employment LLC 35104 Euclid Ave., Suite 303, Willoughby ID: 45-3274785 Date filed: Feb. 7, 2014 Type: Employer’s withholding, unemployment Amount: $38,633 Medicare Transport Inc. 6100 Oak Tree Blvd., Suite 200, Independence ID: 26-4552200 Date filed: Feb. 7, 2014 Type: Employer’s withholding, unemployment Amount: $37,674

Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $16,334

Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $12,702

unemployment, failure to file complete return Amount: $11,392

LD Evolutions 24254 N. Oxford Oval, North Olmsted ID: 26-3512949 Date filed: Feb. 6, 2014 Type: Employer’s withholding Amount: $14,315

Red Fitness 24 7 Maple Heights LLC 18605 Detroit Ave., Lakewood ID: 46-1665297 Date filed: Feb, 6, 2014 Type: Employer’s withholding Amount: $12,355

HRC & R LLC 16300 S. Waterloo Road, Cleveland ID: 27-2628588 Date filed: Feb. 6, 2014 Type: Employer’s withholding Amount: $13,362

Lunas Management LLC 8405 Cherry Hill Lane, Broadview Heights ID: 20-4158678 Date filed: Feb, 7, 2014 Type: Employer’s withholding, unemployment, failure to file complete return Amount: $12,316

Techland Research Inc. 28895 Lorain Road, Suite 201, North Olmsted ID: 31-1565119 Date filed: Nov. 22, 2013 Date released: Jan. 8, 2014 Type: Employer’s withholding, unemployment Amount: $8,759

Field Day Cleaning Inc. 14713 Granger Road, Maple Heights ID: 30-0402503 Date filed: Feb. 7, 2014 Type: Employer’s withholding, corporate income Amount: $13,266 Red Fitness 24 7 Willoughby LLC 18605 Detroit Ave., Lakewood ID: 46-1678476 Date filed: Feb, 6, 2014 Type: Employer’s withholding Amount: $12,995 All Nations Deliverance Ministries International Inc. 15715 Libby Road, Maple Heights ID: 13-4248397

Tremont Electric LLC 2379 Professor Ave., Cleveland ID: 26-0316466 Date filed: Sept. 7, 2012 Date released: Jan. 21, 2014 Type: Partnership income Amount: $42,120

Euclid Day Care Academy Corp.

567 E. 200 St., Euclid ID: 90-0745959 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $11,790

LIENS RELEASED Shree Jagdamba Inc. Foodtown Super Market 7516 Saint Clair Ave., Cleveland ID: 20-8002260 Date filed: July 26, 2011 Date released: Jan. 21, 2014 Type: Employer’s withholding,

Will Repair Inc. 2901 E. 65 St., Cleveland ID: 34-1577547 Date filed: Oct. 14, 2011 Date released: Jan. 8, 2014 Type: Employer’s withholding Amount: $7,499 Yormick & Associates Co. LPA 526 Superior Ave. E, Suite 230, Cleveland ID: 34-1882937 Date filed: Aug. 24, 2012 Date released: Jan. 8, 2014 Type: Employer’s withholding Amount: $18,723

R & L Metal Spinning Inc. 3185 W. 33 St., Cleveland ID: 30-051181 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $37,064 Interactive Search Group LLC 35104 Euclid Ave., Suite 303, Willoughby ID: 27-0961280 Date filed: Feb. 7, 2014 Type: Employer’s withholding, unemployment Amount: $30,570 Red Fitness 24 7 Cincinnati LLC 18605 Detroit Ave., Lakewood ID: 46-1652521 Date filed: Feb, 6, 2014 Type: Employer’s withholding Amount: $26,149 ISG Employment LLC 35104 Euclid Ave., Suite 303, Willoughby ID: 45-3274785 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $23,442

Jacobs Real Estate Services LLC as owner’s representative, is pleased to announce a lease with

TIAA-CREF at

Two Chagrin Highlands

Red Fitness 24 7 Westlake LLC 18605 Detroit Ave., Lakewood ID: 46-1664136 Date filed: Feb, 6, 2014 Type: Employer’s withholding Amount: $21,689 Red Fitness 24 7 Severence LLC 18605 Detroit Ave., Lakewood ID: 46-1725770 Date filed: Feb, 6, 2014 Type: Employer’s withholding Amount: $19,665

TIAA-CREF was represented by CBRE Steve Voinovich

Leased and managed by:

Cleveland Stone Corp.

4400 Carnegie Ave., Cleveland ID: 34-1858405 Date filed: Feb, 7, 2014 Type: Employer’s withholding Amount: $18,824 Brothers Painting & Decorating Inc. 9319 Bohning Drive, Garfield Heights ID: 34-1815287 Date filed: Feb. 7, 2014 Type: Employer’s withholding Amount: $16,685 Warrensville Animal Center LLC 4003 Warrensville Center Road, Beachwood ID: 27-2430639

For leasing information, call

John Klayman or Cindy Greiner at 440-871-4800 www.JRESgroup.com JRES is a fully integrated third-party commercial real estate firm providing: property management • leasing • development and planning • brokerage services • construction management

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Case: University has had considerable growth in law school applications continued from PAGE 5

Before Mitchell, from 2008 to 2011, the law school was led by interim dean Robert H. Rawson Jr., who since has returned to the practice of law at Jones Day. Before Rawson, Gary J. Simson served between 2006 and 2008, when he resigned amid ragged relations with some alumni and big donors.

One source who knows the university well but asked not to be identified said the concern is that the turnover at the top could affect the perception of the law school by outsiders, such as prospective students and parents. However, the same source doesn’t see systemic problems within the law school.

“The fundamentals are in fine shape,” he said. “That’s an excellent faculty out there. The student body is strong. Alumni loyalty is very high.

The question is, what effect do the distractions have on the fundamentals? And I have not seen much.”

Others familiar with the law school concur, and cite recent news as proof.

In an email sent March 11 to law school alumni, Case Western Reserve president Barbara R. Snyder identified what she called a “series of positive developments” at the law school.

They include a hefty rise in applications, which were up 35% compared to this time last year and already had surpassed 2013’s total by 16%.

That’s double-digit growth at a time of double-digit decline, on average, in law school applications in the United States, which as of March 14 were down 10.7% from applications in the like period in 2013, according to the Law School Admission Council in Newtown, Pa. “Right now, this is a really good time in the life of our law school, which I think … is the best-kept se-

cret considering what’s gone on this year,” Scharf said.

Snyder also noted in her email that the law school’s overall ranking was 64th in the U.S. News & World Report list of Best Law Schools ranked in 2014. That’s up four notches from 68th in 2013.

“The number is far lower than we would like, but does mark the first gain the school has made since 2009,” Snyder wrote.

A fatal blow? No Both Berg and Scharf stressed that the continuity of the law school’s faculty and staff is a stabilizer. Of the 49 full-time faculty, 26 are tenured, according to the university.

Scharf and Berg have worked under four deans during their time with the law school — 13 and 15 years, respectively.

Asked Berg whether they have perceived instability, Berg replied, “It’s always hard to predict how things might have been different. Through different points, it certainly felt like business as usual.

We’re still doing our work, teaching our classes, moving ahead.”

According to a post in late September by the TaxProf Blog, the average tenure for sitting law school deans is slightly more than four years, and the median tenure is 3.24 years.

Brent D. Ballard, who received his law degree in 1985 from Case Western Reserve and sits on the law school’s visiting committee, doesn’t see the changes at the top every few years as a sign that the school is

in trouble.

“You would certainly like to have a law school dean that had longer tenure,” acknowledged Ballard, managing partner of the Calfee law firm, where he said one-fifth of the attorneys are Case Western Reserve graduates. But he maintains it is the faculty members who are critical to the student experience.

“Look at a managing partner at a law firm,” Ballard said. “If you have a series of short-tenured managing partners, it certainly causes some disruption among all of the constituents. But, is that a fatal blow? I don’t think so.

“It’s unfortunate that we’ve had this kind of turnover, but I think what’s more important is the relationship between students and faculty,” Ballard said. “When I was in law school, I think I laid my eyes on our dean twice.”

Recent alumna Michelle Reese, who graduated in May 2013 and is now an associate attorney with Day Ketterer’s Canton office, echoed that sentiment.

“Personally, I’m not worried about the school,” Reese said. “I feel that the administrative issues will always be kept separate from the education that the students are receiving there.”

Money matters matter While many share that sentiment, some say the turnover and negative publicity that has come with it pose a risk to the school’s brand and fundraising. According to one former university employee, Case Western Reserve’s law school has made “many poor choices in dean candidates over the years.”

“It’s really, really hard to increase the reputation of your school and

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DEAN DATELINES Case Western Reserve University School of Law ■ March 1, 2014: Michael Scharf and Jessica Berg now are interim deans, upon Lawrence E. Mitchell’s resignation. They had been acting deans since November, when Mitchell Mitchell took a leave of absence.

■ 1997-2006: Gerald Korngold ■ 1996-1997: Michael J. Gerhardt

Cleveland-Marshall College of Law, Cleveland State University ■ 2011-present: Craig M. Boise ■ 2010-2011: Phyllis L. Crocker (interim) ■ 2005-2010: Geoffrey S. Mearns ■ 1997-2005: Steven Steinglass

University of Akron School of Law

■ 2008-2011: Robert H. Rawson Jr. (interim)

■ 2012-present: Elizabeth A. Reilly (interim) ■ 2008-2012: Martin H. Belsky ■ 1995-2007: Richard L. Aynes

■ 2006-2008: Gary J. Simson

■ Sources: The three universities

■ June 2011-March 2014: Lawrence E. Mitchell

really easy to ruin it,” said the former employee, who asked not to be identified. “You have to be smart, and you have to choose people who are visionary.

“Not just Case, but any school that suffers a setback in leadership has to work extra hard to try to maintain its fundraising and rankings and morale,” the former employee said.

That may be, but interim dean Scharf noted that the school’s capital campaign was “extremely successful” under both Rawson and Mitchell. As of late February, it had raised $24.2 million toward its $32 million goal.

Still, Barbara J. Danforth said she is more likely to give her money elsewhere. As a visiting student who attended Case Western Reserve law school for one year, Danforth said the university solicits her often.

“We’ve got another new dean (and) here, after a very short time, he’s gone, and gone under some very suspicious circumstances,” said Danforth, a senior vice president with Ratliff & Taylor, an executive search firm in Independence. “Is that where I’m going to invest my money?

No. There are too many other organizations whose leaders I trust.”

On to the next dean Mitchell’s resignation brings the number of Northeast Ohio law schools that are in some stage of a dean search to two. The University of Akron expects to name a permanent dean for its law school by July.

Case Western Reserve’s president and provost are consulting with constituents before they convene a

search committee, interim dean Berg said. There is no timeline for the start of the search, according to Berg, who noted that searches for deans tend to run on the academic cycle, beginning in mid-fall and wrapping up in early spring.

Berg served on the search committees that hired both Simson and Mitchell.

“It’s not clear what we could have done differently,” Berg said. “It’s not as though people came and two months later left. They were obviously matches for a period of time, and the school accomplished things in that period of time.”

Each of the search committees did extensive background checks on candidates and gathered input from staff, faculty, alumni and students, she said.

“We do our homework,” Berg said. “We do what we can to get a good match.”

Today, law schools seek different qualities in leaders than what they sought a decade ago, according to Tim McFeeley, a vice president with Boston-based executive search firm Isaacson, Miller. He has conducted several law school dean searches, and is conducting another.

Ten years ago, the first priority was finding deans who were worldrenowned legal scholars, McFeeley said. “(Today) they’re in financial difficulty, most of them,” he said of law schools. “They’re looking for people who are creative about creating new revenue sources. They want deans to find ways to bring in money.

That’s not that much different (than before) — it’s just that the pressure is higher.”

■

Apple Growth Partners names Texan its CEO ON THE WEB Story from licly traded media Apple Growth Partwww.crainscleveland.com company headners, an accounting and advisory firm with quartered in Daloffices in Akron and Cleveland, has las, where he served as a corporate a new CEO. officer and a vice president of marHe’s Harold Gaar, a longtime resiketing and sales at The Dallas Morning News, Belo’s largest operating dent of Dallas who served for eight years as managing partner of Travis company.

“I’ve known Harold through our Wolff, one of the largest regional CPA alliance for years and most reaccounting firms in Texas. cently as he served on our board of Apple Growth Partners said Gaar advisors,” said Dave Gaino, chairwill lead the strategic growth of the man of Apple Growth Partners. “I firm and is responsible for all busiadmired the job he did growing ness operations. He also will be Travis Wolff and am thrilled he available to advise clients on a chose to join Apple Growth Partners range of business matters, the firm as our CEO. He brings a wealth of said. experience, operational, and marPrior to his stint at Travis Wolff, keting knowledge to the position.”

Gaar worked for Belo Corp., a pub-

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IN THIS SECTION ■ Crain’s selects an All-Gateway team of the top Cleveland Indians players since 1994. Page 16 ■ We look back at the most memorable moments from the Jacobs/Progressive Field era. Did the “midges game” (right) make the cut? Page 16 ■ Bob DiBiasio, John Hart and Mark Shapiro recall the time in which former Cleveland Indians owner Dick Jacobs was forced to consider every option — one of which was the possibility of moving his beloved team. Page 17 ■ A look at the economic impact of Gateway on downtown Cleveland. Page 18 ■ Business owners discuss the impact of Gateway. Page 19 ■ Jacobs Field broke new ground with the method in which it was designed and the creative way in which it was financed. Page 20 ■ Fans such as Greg Van Niel (bottom right, with three of his souvenirs) recall their fondest memories from the last 20 seasons. Page 21

ALSO ONLINE Go to www.CrainsCleveland.com/Gateway for additional coverage, including: ■ Photo galleries of Cleveland Indians fans and some great moments from the Jacobs/Progressive Field era ■ A preview of the 2014 Cleveland Indians ■ A history of the Gateway project ■ A look at where some of the key players in the Gateway development are now ■ A crucial vote for the three major professional sports teams is only six weeks away

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20 YEARS OF GATEWAY

16 CRAIN’S CLEVELAND BUSINESS

MARCH 24 - 30, 2014

ALL-GATEWAY TEAM

ALEX NABAUM

Catcher ............... Victor Martinez First baseman ...... Jim Thome Second baseman .. Roberto Alomar Shortstop .............. Omar Vizquel Third baseman ......Travis Fryman Designated hitter .. x-Travis Hafner Left fielder ............ Albert Belle Center fielder ....... Kenny Lofton Right fielder .......... Manny Ramirez Starting pitcher .....CC Sabathia Relief pitcher ........ x-Jose Mesa x-Not pictured ■ For a preview of the 2014 Cleveland Indians, go to: www.CrainsCleveland.com/Gateway ■ For more on the All-Gateway team, read Kevin Kleps’ blog at: www.CrainsCleveland.com

About the starting catcher …

W

e know what you’re thinking: Where’s Sandy Alomar? The catcher who hit two of the most memorable home runs in Indians history (the 1997 All-Star game at Jacobs Field and against the Yankees in the ’97 postseason) surely belongs on the All-Gateway team, right?

The key words in this discussion: All-Gateway, the best players since the ballpark debuted in ’94.

Three of Alomar’s six All-Star seasons were pre-Gateway, and from 1994-2000, he was limited to 93 games per season because of injury. In that span, he drove in more than 50 runs just once — during his sensational 1997 season.

Victor Martinez, meanwhile, batted .297 in eight seasons with the Tribe. In that span, he

made three All-Star teams, won a Silver Slugger award and had three .300 campaigns.

If this was an all-time Indians team, Alomar would’ve been the selection. But since 1994, Martinez has been the most productive Tribe catcher.

The only other positions that required some debate among the Crain’s staff were second base, third base and the two pitching positions.

■ Carlos Baerga was good in 1994 and ’95, but his best seasons were pre-Gateway. And Robbie Alomar was fantastic throughout each of his three years for the Tribe.

■ The Indians’ third-base situation has been so bleak that the only other players who merited serious consideration were Matt Williams, who played all of one year in

Cleveland, and Casey Blake, a .266 hitter with the Tribe who spent a chunk of his time in right field.

■ Sabathia (106-71, 3.83 ERA with the Indians) was selected over Cliff Lee, another Cy Young winner who was traded before he hit it big in free agency, Charles Nagy and Bartolo Colon.

If we were choosing a five-pitcher All-Gateway rotation, we would have probably selected Sabathia, Lee, Colon, Nagy and Orel Hershiser.

■ Mesa had a combined 101 saves from 1995-97, which was enough to give one of the cover subjects of Cleveland’s all-time sports misery the nod over the likes of Bob Wickman (the Indians’ all-time saves leader) and Chris Perez (who made two All-Star teams before he lost it in 2013).

— Kevin Kleps

GREATEST GATEWAY MOMENTS ■ 1. April 4, 1994: Before a sellout crowd of 41,459, the Tribe in extra innings defeated the Seattle Mariners in the first game at what then was known as Jacobs Field.

The Indians won it in the 11th when Eddie Murray doubled and then scored on a two-out single from Wayne Kirby. It was the first of what would become many dramatic finishes at the ballpark.

known as midges, the Indians rallied to beat the New York Yankees 2-1 in extra innings. The bugs rattled Yankees reliever Joba Chamberlain, who surrendered the Yankees’ lead. A Travis Hafner single in the 11th drove in Kenny Lofton for the victory.

■ 2. Oct. 3, 1995: In the first game of the American League Division Series against the Boston Red Sox, Indians catcher Tony Pena delivered Cleveland its first postseason victory since 1948 with a dramatic 13th-inning home run.

■ 4. Oct. 5, 1997: With two outs in the eighth inning and Mariano Rivera on the mound, it seemed all but certain the Indians would be eliminated by the New York Yankees from the 1997 postseason. That is until Sandy Alomar Jr. homered to tie the game and save the Tribe from

■ 3. Oct. 5, 2007: Amid an invasion of mosquito-like insects

GETTY IMAGES

postseason elimination.

■ 5. Aug. 5, 2001: The Indians rallied to overcome a 12-run deficit and defeat the Seattle Mariners 15-14 in 11 innings. It

would tie a major-league record and made the Indians the first team in 76 years to overcome a 12-run deficit.

closers in baseball. All Eckersley could say was “Wow.”

Honorable mention

■ July 8, 1997: Tribe catcher Sandy Alomar hits a home run to help the American League defeat the National League 3-1 in the 68th MLB All-Star game. Alomar was named the most valuable player.

■ June 4, 1995: Tribe first baseman Paul Sorrento nails a two-out, two-run home run to seal a threerun ninth inning, giving the Indians a 9-8 victory over the Toronto Blue Jays. The Tribe trailed 8-0 in the third inning.

■ July 16, 1995: In walk-off fashion, Tribe outfielder Manny Ramirez hits a home run in the 12th against Dennis Eckersley of the Oakland A’s — one of the best

■ Sept. 8, 1995: The Indians clinch their first division title in 41 years.

■ Oct. 11, 1997: The Indians secure a 2-1, 12th-inning win in the third game of the American League Championship Series when Marquis Grissom steals home after Omar Vizquel misses a suicide squeeze bunt and Baltimore catcher Lenny Webster drops the ball. — Timothy Magaw

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CRAIN’S CLEVELAND BUSINESS 17

New park helped Indians become hit on, off field

By KEVIN KLEPS kkleps@crain.com

B

ob DiBiasio remembers then-Major League Baseball commissioner Fay Vincent sitting in a golf cart at Cleveland Stadium prior to the Cleveland Indians’ game against the Toronto Blue Jays on May 2, 1990.

Vincent’s message to the Northeast Ohio media, six days before Cuyahoga County voters were asked to approve an excise tax on alcohol and tobacco: If the referendum to fund the construction of the Gateway stadium-arena complex failed, Cleveland could lose its baseball team.

“There was some seriousness to all of that,” said DiBiasio, the Indians’ senior vice president of public affairs and a 35-year employee of the team.

The Indians had long grown tired of playing at the cavernous stadium, where they were tenants of Browns owner Art Modell.

They played before sparse crowds, they annually had one of baseball’s lowest payrolls, and losing was almost as constant as the beat of John Adams’ drum.

“It just wasn’t ours,” former Indians general manager John Hart said of Cleveland Stadium. “There was no real charm or magic. No real history.”

Hart and Indians president Mark Shapiro, who joined the Tribe in 1992 as an assistant in baseball operations, said Dick Jacobs had no intentions of taking his team elsewhere.

“He never once mentioned to me in any conversation, ‘If this doesn’t work, we’re moving,’ ” Hart said.

“He didn’t have to.”

The unspoken implication: Moving the team was a last resort to which Jacobs never dreamed he would go.

“When I first began working here, there was some recency to that threat (of the Indians leaving),” Shapiro said. “But it was clear that Dick Jacobs owned the team partly out of a civic responsibility and a civic goal to keep the Indians here. I think that was the goal — that and to develop a state-of-the-art ballpark.”

What if?

Jacobs, in addition to having Cleveland pride, was a very astute businessman.

Hart said no matter the result of the sin tax vote in 1990, one thing was clear: “I don’t think Dick would’ve remained a tenant of Art Modell and the Browns. He wasn’t going to be No. 2 to a football club in a football stadium.”

But would Jacobs have moved the Indians if the tax hadn’t passed by the slimmest of margins (1.2%)?

“I would venture to say that Dick might have given it one more shot (to get funding for a new ballpark in Cleveland),” Hart said. “I don’t know if he had the wheels in place. I had several calls from several cities that were feeling out if the Indians would be willing to move. We were the prime bait for some cities.”

At the time, a baseball franchise hadn’t relocated since the Washington Senators left the nation’s capital to become the Texas Rangers in 1972.

Minus the sin tax, would the Indians have joined the list?

“It would be almost impossible to

see the Indians playing in (Cleveland Stadium much longer than 1993),” Shapiro said. “It’s almost impossible to foresee baseball remaining in Cleveland. Either the team would be moving or there would be a ballpark built somewhere else (in the city).”

Glory days Jacobs’ worst fears were never realized.

“The (sin tax) vote was very close,” Hart said. “Dick was very poised and very confident it was going to go through. When it passed, there was no celebration.”

The parties occurred later, after the “perfect storm” struck.

Hart and the Indians’ minor

league development team — a department Shapiro directed from 1994 to ’98 — had the Tribe poised for sustained success.

Seven regulars from the 1994 Indians’ lineup — Sandy Alomar Jr. (28 at the time), Albert Belle (27), Kenny Lofton (27), Omar Vizquel (27), Carlos Baerga (25), Jim Thome (23) and Manny Ramirez (22) — were either in their primes or hadn’t yet entered the primes of their careers.

The new jewel of a ballpark — which opened on April 4, 1994, in a dramatic fashion (an 11th-inning victory) that would become as anticipated as a smile from Vizquel or a snarl from Belle — was a critical piece in a near-championship puzzle.

“From a baseball perspective, it was a gift,” Hart said of Jacobs Field. “We were able to design all of the things you wanted to appeal to the players. It was sort of a perfect storm in a positive way.”

The Indians were also able to go toe-to-toe with the big boys of Major League Baseball on a level at which they hadn’t been able to approach in the past.

“It could be the most significant move in franchise history, simply because it provided us the economic foundation to compete at the major-league level,” DiBiasio said.

The Indians’ average attendance per game was 39,121 in the strikeshortened 1994 season. From 1995 to 2001, they sold out 455 consecutive games, then a big-league record,

and they drew more than 3 million fans for six consecutive seasons.

The box-office jolt meant significantly more money was invested in a roster that was loaded with young talent.

The Tribe’s payroll jumped from $18.56 million in 1993 to $30.49 million in ’94, the first season at the Jake. The payroll increased $7.6 million to $38.1 million in 1995, when the Indians celebrated their first postseason berth in 41 years by advancing to the World Series, and it got as high as $93.36 million in 2001, the Tribe’s second season under the ownership of the Dolan family.

“That wasn’t us acting outside of revenue,” Shapiro said. “That was us spending revenue.”

■

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20 YEARS OF GATEWAY

18 CRAIN’S CLEVELAND BUSINESS

MARCH 24 - 30, 2014

District set stage for development, not job boom

By STAN BULLARD sbullard@crain.com

C

all it the Gateway getaway.

Chris and Sandy Haas own a two-bedroom condo on the fifth floor of The Pointe at Gateway, 750 Prospect Ave., to make a weekend of it as they take advantage of Indians season tickets and Cavaliers and Browns suites.

“The arena is outside the back door.

East Fourth Street is near the front door,” Chris Haas said. “It’s so much fun to be in the heart of the action. Then it’s back to reality.” On Monday mornings, they make their way home to a house on the Avon Lake waterfront and to All Pro Freight Systems Inc. in Avon, where Chris Haas is CEO. Before Gateway opened in 1994, there were no condos for sports fanatics or even apartment rentals for young professionals in the area south of Euclid to the Innerbelt. The area pre-Gateway was a hodgepodge of buildings from the Central

Market to legacy downtown stores such as the now-closed Goldfish Army Navy Store, hat stores, wig stores, and shoe and clothes stores.

Hunter Morrison, director of the Cleveland City Planning Commis-

sion during the first Gateway campaign in 1990, said, “That area from the south side of Euclid Avenue had not seen a nickel of investment since the first World War.” Today, a plethora of parking lots

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and a handful of wart-like underutilized buildings still await their next chapter, but the 20 years since Gateway opened have been followed by $700 million in property development, according to Historic Gateway Neighborhood Corp., a local development corporation serving the sports complex’s neighborhood.

The list of commercial real estate developments in the Gateway area is a long one. Central to the area is Cleveland-based MRN Inc.’s East Fourth Neighborhood, which includes apartments, restaurants and entertainment spots that spill onto Euclid from East Second to East Sixth streets.

Others include the Hyatt Regency Cleveland at the Arcade, Radisson Hotel Cleveland-Gateway, Hilton Garden Inn, the Osborn and other apartment buildings and a roster of eateries and bars.

However, that is different from what was pictured by Gateway backers and city officials in the Mike White administration during the 1991 campaign for the sin tax that funded much of the project’s cost. The central refrain then: Gateway would be a job creator.

City planners estimated it would yield 17,000 jobs.

Morrison, now executive director of the Northeast Ohio Sustainable Communities Consortium nonprofit, said the jobs estimate was based on the likely mix of office and residential that could go into the shadow of the sports complex.

“We were on track through the construction of Key (Tower) to build an average of half-a-million square feet of office space (annually) for a couple years,” Morrison said. “Things changed when Sohio (now BP America) merged and moved from town and Progressive Corp. built in Mayfield Village in-

stead of coming downtown.”

When Ernst & Young Tower opened a year ago, it was downtown’s first new multitenant office building in 20 years.

Today, Ken Silliman, Mayor Frank Jackson’s chief of staff and a veteran of the White administration, points instead of jobs to the resurgence of the district and the creation of a neighborhood fabric like Chicago’s Wrigley Field or Boston’s Fenway Park.

Setting the table What has happened is that the Gateway neighborhood is a central focus of redevelopment that plays a key role connecting disparate parts of downtown, from Cleveland State University and PlayhouseSquare to the Warehouse District. It was reinvigorated with restaurants, apartments and bars that attract today’s hipsters as the world’s cities compete for talent.

Gateway helped set the table for rebuilding that part of downtown in multiple ways.

For one, the Gateway corporation itself commissioned an awardwinning plan by Sasaki Associates with suggestions for capitalizing on the nearly $500 million investment in the stadium complex. The plan identified new routes for north and south development at Gateway beyond Ontario and East Ninth streets: today Clevelanders know them as East Fourth Street between the repurposed 1890s-commercial buildings and what is now the 5th Street Arcades.

The area also benefits from three national historic districts that make it easier for old buildings to win crucial state and federal tax credits for adaptive reuse projects.

See DISTRICT Page 19

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20 YEARS OF GATEWAY

MARCH 24 - 30, 2014

District continued from PAGE 18

Tom Yablonsky, vice president of development for Downtown Cleveland Alliance and executive director of the Historic Gateway and Historic Warehouse District Development Corp. nonprofits, said the project demonstrates that, “If you design it right, you’ll achieve spinoff and a vibrant neighborhood.”

Real estate developers also had a lot to work with, although in 1994 it was hard to see behind upper-floor windows caked with dust or walls covered with aluminum to make century-old buildings look like 1950sand 1960s-era office buildings.

“Many of the buildings have intrinsic value; they date back to the Gilded Age when Cleveland was a wealthy city,” Yablonsky said. “The captains of industry traveled through Europe and wanted similar things here. That is how you get something like the Old Arcade.”

Although its first-floor retail has languished, in 2001 the glass-topped building was updated in a $60 million project and redone as a Hyatt Hotel.

The go-slow approach Moreover, the area’s redevelopment was incremental; much of it led by local real estate developers or property owners.

Ari Maron, spokesman for familyowned MRN, which produced East Fourth Neighborhood, remembers the first time his father, Rick Maron brought his family downtown to look at the Buckeye Building, a building fronting on Prospect with a 2082 East Fourth address.

It was 1996, and Ari Maron, a precocious Shaker Heights High School junior, said, “‘Dad, why did you buy this?’ He pointed at where construction workers were building the ballpark and arena and said, ‘It’s going to change the whole area.’”

Initially, Rick Maron planned to do one building. After renovating the second — the Windsor Block, at 322 Euclid — as apartments, Ari Maron said his father expected a national developer to do the rest of the street.

Instead, MRN wound up doing most of it.

Critics of stadium and arena-area economic development strategies often say there is no proof that hotel, retail or office developers put in their projects because of the sports facilities.

However, ask real estate developers in addition to MRN why they located projects near Gateway and they speak with one voice.

Landmark RE Management, the Cleveland-based real estate development firm that helped establish the Warehouse District as a residential area, also led the redevelopment of the one-time Colonial Hotel and Euclid and Colonial Arcades into Colonial Marketplace in a joint venture with hotelier Amitel Inc., and the building owner, the Marcus family.

John Carney, a Landmark principal, said, “Interest of the group (in the original development) was high because the Indians and Cavs were basically across the street.” Thanks to its Residence Inn, Colonial Marketplace just sold for almost $16 million. Today, Landmark is partners in a plan to repurpose the empty May Co. store’s upper floors to apartments, but Carney said the project is designed to meet housing demand.

Thank goodness it’s not 1984 Fast forward to now, as Streetsboro-based Geis Cos. recasts the former Ameritrust Complex at East Ninth and Euclid as The 9 in a mixed-use project with apartments, a hotel, supermarket, restaurants and a $200 million price tag.

Fred Geis, who partners with his brother Greg Geis in The 9, said, “I do remember the old area. Gateway is a very important part of everything we are doing today. If (East Ninth) looked the way it did in 1984, there’s no way in heck we would do this.”

Several elements also went in Gateway’s favor.

The Greater Cleveland Regional Transit Authority won federal funds to remake Euclid as a bustransit corridor that spurred added investment. Horseshoe Casino Cleveland added another attraction. Yablonsky notes that Gateway came along just as government, civic and real estate developers learned the tools, from state and federal tax credits to alternative building codes to redo buildings.

That set the table for Sandy Haas, who had suggested to her husband that they buy a condo after a hard-hat tour as the Higbee Building was being converted to the casino in 2011.

“I thought, it would be so cool to have a place down here,” she said.

“Now we go to (Hilarities) all the time after games. We wouldn’t do that if we were driving in for a game.”

■

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CRAIN’S CLEVELAND BUSINESS 19

MORE PERSPECTIVE ON GATEWAY’S IMPACT ■ Jerry Schmelzer began running an elevator at the Finance Building, 750 Prospect Ave., at age 10 when his father bought the office building. He recalls it as a busy shopping area serving working people. Over time, upper floors of the buildings emptied. By the 1970s, people no longer felt safe walking after dark.

Then came Gateway.

“It has had a tremendous impact,” said Schmelzer, 76. “If there were no Gateway, I don’t think it would have developed the way it has. Before Gateway, this was all bars, wig shops, loan shops and sports shoe stores. The buzz started as soon as the (sin) tax passed.”

Mr. Schmelzer ran a public relations/ad agency in the building until phasing it out in the mid-1990s.

That’s when he oversaw the redo of the building and three adjoining structures into Pointe at Gateway, a $12 million retail/residential complex.

■ When Mike Rubin bought Prospect Music in 1982, it had been in the same place since 1941. Now at 818 Huron Road, it is in its third home since Gateway went up after exiting others as the buildings became upscale lofts.

“My experience is that landlords keep telling you that they want you, until they don’t,” Rubin said.

“There are not nearly the jobs in the area that used to be here,” he said, adding that he considers benefits from higher visibility “infinitesimal.” He remained there due to

“force of habit” and downtown having less competition than suburbs oversaturated with music stores.

A plus, he noted, is the area has gained a new sense of community.

Traveling rock stars still stop by, he said, but most working musicians can’t afford to live downtown.

■ Andy Wohlgang’s face and Read’s Jewelers store are familiar to late-night local TV viewers. He aggressively advertises the business dating to 1930 that he has owned since 1971.

“I’m in a business that, no matter what, people come to me when they need my services,” he said of the jewelry store, which also operates a gold and diamond-limited pawn shop.

He’s now at 740 Prospect Ave. His old location, at 211 Prospect, was razed to create the parking lot and entrance to the garage serving East Fourth Street’s apartments, restaurants and the House of Blues.

Wohlgang considers Gateway a big plus. “Downtown has improved (since Gateway), no question about it,” he said. “East Fourth is an improvement.”

■ Maria Toptsidis runs her late mom’s Helen’s Tailor Shop and dry cleaners, 2121 E. Second St., as part of her North Olmsted-based Unique Dry Cleaners, but she says she might pull the plug on it if sales do not improve.

Toptsidis’s mother, Helen Hatzigeorgiou, bought the shop in 1972, renamed it after herself and ran it until she died in 2012.

Toptsidis feels that Gateway has not been good for small businesses.

She had operated her own store, Top Tailor Shop, on East Ninth Street near the ballpark for six years until 1991, when sidewalk and street closings for Gateway construction starved her out.

She reopened in North Olmsted, but her mom held on. That store took another kick from construction of the parking garage for Horseshoe Casino Cleveland; sales still suffer. That is why 2014 may be its last year.

“The rich benefit and the other ones who survive stay in business,” Toptsidis said. But she takes the big view: “We needed Jacobs Field. It was good for our city, so we can be up there with other cities.”

■ Adrian Lindsay is operations manager at Stonetown, a soul foodfusion restaurant that has been at 627 Prospect Ave. for a year.

Owned by a Cleveland-based group with four other locations in the region, Stonetown went in near Gateway because it got an attractive rent at the location from building owner K&D Group and wanted to be part of the downtown’s expanding business environment.

“This is an event-oriented location,” Lindsay said. “It’s kind of a challenge.

Winter is tough but summer and spring are great.”

Games at Gateway account for a lot of its business, he said; he boosts staffing 20% if the Cavs are playing Miami or another contender. The ballpark provides less bounce.

A Warrensville Heights native, Lindsay remembers the neighborhood prior to the sports complex. “This area would be a mess without Gateway,” he said.

— Stan Bullard

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20 CRAIN’S CLEVELAND BUSINESS

20 YEARS OF GATEWAY

MARCH 24 - 30, 2014

Jacobs Field was model many others followed

By JAY MILLER jmiller@crain.com

TAXING ISSUE SOON WILL HIT BALLOT

E

very major league sports palace in the country is one-of-a-kind. All have been custom made for their sports teams and their communities.

Yet in the recent history of baseball stadium building, Jacobs Field, now Progressive Field, stands out as breaking new ground for its siting, its design and the creative way it was financed.

“Almost every new sports facility project looks to Camden Yards or Gateway (in Cleveland) as a model for how such a project should proceed,” wrote the Journal of the American Planning Association in 2004. “Recently opened stadiums in Detroit and Seattle, and new arenas in Washington, D.C., and Indianapolis, utilized Camden Yards and Gateway as models, influencing their design, site choice, and the inclusion of a variety of uses within the facility.”

They were called “retro” stadiums, and it was the design of choice for nearly two decades, culminating in the new Yankee Stadium that opened in New York in 2009.

They were very much unlike the “superstadiums” built in the 1970s and 1980s. There, fans watched games in sunk-into-concrete bowls and surrounded by acres of parking miles from downtown.

Some even were domed stadiums.

By contrast, retro parks were designed of brick and steel to blend into the late 19th or early 20th century buildings that were their neighbors in older urban areas.

Beginning with Oriole Park at Camden Yards in Baltimore in 1992, and with Jacobs Field two years later, the retro parks often were irregularly shaped to fit onto the existing street grid and were left open to the urban skyline beyond the stadiums’ walls.

“You wanted those buildings to be in city grids” downtown, said Thomas Chema, who served as Gateway Economic Development Corp.’s executive director from 1990 to 1995. “(Gateway) jumpstarted a whole set of positive things for the community, including the Great Lakes Science Center and the development of the Historic Gateway Neighborhood.” The science center opened in 1996, while the Gateway neighborhood

The question Cuyahoga County voters will be asked on May 6 is not whether they want to continue paying a so-called sin tax on their vices — smoking and drinking — for another 20 years.

Nor are they being asked to vote to stop spending for the upkeep of Progressive Field, Quicken Loans Arena and FirstEnergy Stadium and turn that financial responsibility over the sports teams that use those sports facilities.

They are being asked only if they want to continue paying a special Cuyahoga County add-on to what the state calls excise taxes on alcoholic beverages and cigarettes.

And they may be asked this question a time or two more if civic leaders don’t get the answer they want this first time.

If a majority of Cuyahoga County voters say yes on May 6, the total excise taxes they will pay will remain where they are — at 34 cents on a

gallon of beer, between 64 cents and $1.82 per gallon of wine or mixed beverages, depending on the percentage of alcohol, and $1.70 cents on each pack of cigarettes.

That will continue to give Cuyahoga County and the city of Cleveland a dedicated revenue stream to pay for the upkeep of the buildings used by the Cleveland Indians for baseball, the Cleveland Cavaliers for basketball and the Cleveland Browns for football.

If they say no, people who buy those products in Cuyahoga County will still pay tax on them, just not the county’s add-on portion, the state tax on those products will remain. So, instead of paying 34 cents per gallon, Cuyahoga County beer drinkers will only pay the Ohio rate, or 18 cents a gallon. The state tax on wine will remain at between 32 cents and $1.50 a gallon, depending on the alcohol content and cigarettes will be taxed at $1.25 a pack. — Jay Miller

has become a trendy place to live and dine out.

Chema, who is retiring in June after serving 11 years as president of Hiram College, spent his time between Gateway and the Portage County college as a consultant on stadium and arena building. He spread his knowledge of the Gateway experience to projects in more than 30 other communities, including Petco Park in San Diego, Paul Brown Stadium in Cincinnati and Canal Park in Akron, home of the Cleveland Indians’ AA affiliate, the Akron RubberDucks.

Though the retro concept eventually would lose its freshness, more than a dozen followed Baltimore and Cleveland, according to “Big League Parks: The Complete Illustrated History,” a 512-page paean to ball fields published in 2009.

Among the followers were Comerica Park in Detroit, Coors Field in Denver and Pacific Bell (now AT&T) Park in San Francisco. All mimicked Jacobs Field, especially its ornate steel light towers. Perhaps not surprisingly, all five stadiums, including Jacobs Field, were

designed by HOK Sport, now Populous, a Kansas City, Mo.-based division of Hellmuth, Obata and Kassabaum.

Gateway’s financing also was pioneering. For decades before Gateway, stadiums were financed 100% with public tax money.

Its financing, though, was cobbled together out of a mix of public tax money, revenue from the advance purchase of luxury seating, property loans and even a $22 million contribution from Cleveland Tomorrow, a corporate roundtable that has since been absorbed by the Greater Cleveland Partnership. “(Jacobs Field) set the tone for (the financing of) everything that came after it, from Coors Field to the San Francisco Giants building,” Chema said. “All the baseball parks, but also all the arenas.”

What has not been duplicated, though others have tried, is the pairing of a stadium and an arena in a downtown setting, Chema said.

He said several cities, including Baltimore and Denver would site stadiums or arenas near existing downtown retro ball parks, but none has done them in tandem.

“This was the largest public-private partnership ever in Northeast Ohio,” Chema said with some pride. “And nobody in the country has done a ball park and an arena together.”

■

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■ A look at some of the key players in the development of Gateway, such as Tom Chema (right).

■ Some of the early plans for new sports facilities in Cleveland included a dream of a domed stadium that could one day host the Super Bowl.

■ More on the sin tax, including why opponents such as ad man and restaurateur Alan Glazen feel “we stoop to our lowest ethical levels by making a minority pay for something enjoyed mostly by the majority.”

Read the stories at: crainscleveland.com/gateway

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20 YEARS OF GATEWAY

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CRAIN’S CLEVELAND BUSINESS 21

New facility has helped to create many new memories

By TIMOTHY MAGAW tmagaw@crain.com

seen that were new pretty much looked like flying saucers that landed and then they put seats in them.

But I fell in love with (Jacobs Field) immediately. It was a ballpark.”

G

reg Van Niel has witnessed his fair share of memorable moments at Progressive Field. The perennial season-ticket holder was there for the electrifying home opener in 1994 and two World Series berths.

Also, last year, he caught four foul balls during a single game —a serendipitous occasion that even landed him on “SportsCenter.”

But the memory he holds particularly close to his heart? Last year, when he took his 11-year-old daughter, Ella, to the team’s first postseason appearance since 2007, when the Tribe faced the Tampa Bay Rays in a one-game playoff for the American League wild card. The Tribe fell short, but for Van Niel, being able to bask in the energy of a sold-out ballpark with his young daughter by his side was something to behold.

“It was my daughter’s first playoff game, and she was overwhelmed,” said Van Niel. “It was so loud she had to stick her fingers in her ears. I told her that there was nothing like playoff baseball.”

Fans like Van Niel insist it’s memories like these — not the hulking steel beams that form the ballpark’s shell, the bobblehead promotions or dollar dog nights — that make Progressive Field such a special place in the city. When it opened in 1994 as Jacobs Field, the park marked a new era for the Tribe. Sure, the physical facility

Enduring memories

CONTRIBUTED PHOTO

Maryhelen Zabas was a regular at Jacobs Field during the 1990s.

MORE ONLINE ■ Check out a photo gallery of fans enjoying some memorable moments at Cleveland Indians games: CrainsCleveland.com/Gateway was impressive, but the renewed hope and energy for a franchise that hadn’t won a championship since 1948 was the real story.

Maryhelen Zabas remembers Opening Day in 1994. Zabas — the iconic, cookie-peddling nun then known Sister Mary Assumpta — often was spotted in the stands during the Indians’ impressive run in the mid- to late-1990s. She has since left her religious order to pursue a ministry with the dying in Oregon, but she still fondly remembers the excitement surrounding the ambitious Gateway project.

“It was crazy wild,” Zabas said about the ballpark’s opening in 1994. “Everybody was so excited, but I have to tell you, I didn’t want a new ballpark. All the ones I had

SWEET SUITES!

Traci Christler is a self-described boomerang kid. She grew up in Cleveland, but she went to school elsewhere and spent more than a decade in Indianapolis.

Now, the 42-year-old nonprofit professional is back in Cleveland and is an Indians season-ticket holder with her father, Gary.

When she was younger, her dad would take her to games at the old Cleveland Stadium, and one of her favorite memories was running up and down the stairs of the often empty stadium to find the perfect seat. Her dad taught her to keep score, and she grilled him about how John Adams — the Tribe diehard who has banged on a 26-inch bass drum in the outfield for decades — got the “best job on the planet.”

The Tribe’s move to Jacobs Field altered the game-day experience from those early days at Cleveland Stadium — all for the better, Christler said. Adams, of course, was still pounding away in the outfield, but the digs were nicer and the teams were better.

The memories with her dad? Just as good.

“We had this shiny new toy to play with,” Christler said in an interview shortly before catching a flight to see the Indians in Arizona at spring training. “At Municipal, everything was falling apart. You would get splinters from the chairs. At Jacobs Field, everything was bright and shiny, and then all of a sudden we had these amazing Tribe teams that were winning.”

Indians fans, particularly those entrenched in the glory of the mid-to-late 1990s, still have a hard time calling the ballpark by its newish name, Progressive Field.

For the most part, it’s still The Jake. Shortly after the name change, CLE Clothing Co. — a local clothier now with a retail shop on East Fourth Street — started selling shirts that said, “It’s still The Jake to me.”

“During this time, the Tribe had fallen from the good teams from the ’90s and all the good times had at The Jake,” said Mike Kubinski, the company’s founder, owner and designer. “We did the design for the nostalgia of the name and the memories.”

The beat lives on Adams and his bass drum are as permanent fixtures at Progressive Field as the 19-foot-tall “Little Green Monster” in left field or the Bob Feller statue outside Gate C. Adams has kept the pulse at Tribe games for more than 40 years — 20 of which were at Progressive Field.

Adams characterizes his seats atop the left-field bleachers as his “escape” or “fantasy island.” Loyal? Absolutely. Crazy? Maybe a bit.

Adams is one of a horde of recognizable Tribe fans who’ve attended seemingly hundreds of games over the years. Just for starters, there’s Jim Stamper and his large sign depicting Chief Wahoo flexing his large biceps and Tom “the Hat Man” O’Toole, a regular season ticketholder who would change hats every inning.

“Being a Cleveland Indians fan, there is no cure,” Adams said. “But there is group therapy. It’s called going to a game.”

■

CRAIN’S SPORTS SERIES: THE BUSINESS OF BASEBALL In conjunction with Crain’s “Twenty Years of Gateway” section, an April 16 breakfast at The Collection Auto Club at Progressive Field will give a behind-the-scenes look at the business of Indians baseball.

It also is an opportunity to experience a day in the life of a major-league sportswriter.

Attendees will have access to the press box and press dining room — as well as the chance to participate in a Q&A session with the Indians’ top leadership.

The speakers and topics will be: ■ Mark Shapiro, president, Cleveland Indians (right): “Small market, big competitor: The Business of Indians Baseball” ■ Bob DiBiasio, senior vice president public affairs, Cleveland Indians: “Memories and magic: Celebrating 20 years of baseball at Gateway” ■ Brian Barren, executive vice president, sales and marketing, Cleveland Indians: “Marketing a major-league ballclub in 2014” Limited space is available for the event, which will run from 7 to 9:30 a.m. For information or for tickets, contact Kim Hill at 216-771-5182 or kehill@crain.com, or go to CrainsCleveland.com/Indians.

Tickets must be purchased in advance.

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CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

MARCH 24 - 30, 2014

EMPLOYEE BENEFIT SERVICES FIRMS RANKED BY NUMBER OF AREA PROFESSIONALS(1)

Name of firm Address Rank Phone/Website

Professional employees 2014

2013

Total employees in NE Ohio

Clients in NE Ohio (%) Firm compensation

Services

Top local executive Title

1

Towers Watson 1001 Lakeside Ave., Suite 1900, Cleveland 44114 (216) 937-4000/www.towerswatson.com

131

114

160

NA

NA

Benefits, talent management, rewards and risk and capital management

Mike J. Turk managing consultant

2

Mercer 200 Public Square, Suite 900, Cleveland 44114 (216) 830-8000/www.mercer.com

110

93

110

NA

By project, commissions, fixed fees, hourly rates

Retirement and risk management, health and welfare benefits, investment consulting and management, work force communication and change

Scott Kiper Larry Scherer principals

3

Oswald Cos. 1100 Superior Ave., Cleveland 44114 (216) 367-8787/www.oswaldcompanies.com

100

93

243

80

Fees, commissions

Employee benefits strategic consulting, group benefits brokerage, integrated health and wellness management, retirement plan consulting

Robert J. Klonk CEO

4

Selman & Co. 6110 Parkland Blvd., Cleveland 44124 (440) 646-9336/www.selmanco.com

78

70

83

5

Commissions and fees

Administration of life and health insurance programs for banks, credit unions, affinity groups and insurance company partners

David L. Selman president, CEO

5

Findley Davies Inc. 1300 E. Ninth St., Suite 850, Cleveland 44114 (216) 875-1900/www.findleydavies.com

68

64

83

64

Fee-for-service based on hourly rates

Health and group benefits, retirement consulting, actuarial services, defined contribution plan recordkeeping, defined benefit plan administration

Rob Rogers principal, chairman

6

Gallagher Benefit Services Inc. 1100 Superior Ave. Suite 1700, Cleveland 44114 (216) 623-2600/www.gallagherbenefits.com

58

50

62

90

Fees and commissions

Brokerage and consulting in health and welfare, retirement, wellness, human resources, health care analytics, benefits compliance

Mark F. Alder area president

7

Alpha Group Agency Inc. 4200 Rockside Road, Independence 44131 (216) 520-3300/www.thealphaga.com

53

51

77

90

NA

Medical, HSA/HRA, dental, disability, life, wellness, 401(k), voluntary benefits,deferred comp, executive benefits, Claims Advocacy, COBRA administration

Kevin Mackay, John Wain, Jim Schade, Adrienne Vichill, Brian Spear, principals

8

Tegrit Group (Summit Retirement) 13680 Cleveland Ave., Uniontown 44685 (330) 644-2044/www.tegritgroup.com

51

37

61

80

Fixed fees, project, hourly rates

Actuarial, administration, compliance, consulting, plan design, government filings, benefits outsourcing

Michael M. Spickard CEO, chief actuary

9

The Fedeli Group 5005 Rockside Road, Fifth Floor, Independence 44131 (216) 328-8080/www.thefedeligroup.com

50

40

125

80

By consulting services, commissions, fixed fees

Employee benefit plan design including consulting, compliance, wellness, self funding and data analytics, voluntary and executive benefits, group purchasing

Umberto P. Fedeli president, CEO

10

Dawson Consulting Group, an AssuredPartners Co. 1340 Depot St., Rocky River 44116 (440) 333-9000/www.dawsoncompanies.com

45

26

65

75

Commissions, fixed fees

Industry-specific solutions that enable business owners to James F. Harmon attract and retain employees, while growing their president, employee benefits business

11

CBiz Inc. 6050 Oak Tree Blvd. South, Suite 500, Cleveland 44131 (216) 447-9000/www.cbiz.com

40

42

171

100

NA

Group health benefits consulting and administration, retirement plan solutions, payroll, COBRA, flex, property and casualty, life insurance and HR consulting

Michael P. Kouzelos SVP, strategic initiatives, COO, employee services

12

CPI-HR 6830 Cochran Road, Solon 44139 (440) 542-7800 /http://cpihr.com

37

36

85

80

Consulting fees and commissions

Health care reform navigation including pay or play analyzer tools, benefit and payroll/HR administration and HR assist services for HR departments

Jim Hopkins CEO

CALL THE EXPERTS FOR YOUR EMPLOYEE BENEFIT AUDIT Contact Chris Villari + cvillari@maloneynovotny.com + 216.363.0100

13

Employee Benefits International 4700 Rockside Road, Summit One, Suite 505, Independence 44131 (216) 264-2707/www.employeebenefitsint.com

29

24

29

70

Fees and commissions

Health care consulting, corporate wellness, 401k and Dustin, president retirement planning, worksite marketing and property and Jim Brian Hirsch, COO casulty

14

Huntington Insurance Inc. 200 Public Square, Cleveland 44114 (888) 576-7900/www.huntington.com

28

32

65

35

Commissions and fees

Consulting and strategic planning in: population risk Craig Mottice management, on-site clinics, data analytics and predictive exec. vice president, modeling, results-based wellness and health care reform managing director, Northeast Ohio

15

Aon Hewitt 5005 Rockside Road, Suite 1000, Independence 44131 (216) 573-9700/www.aonhewitt.com

26

26

60

NA

NA

Empowers organizations and individuals to secure a better future through innovative talent, retirement and health solutions

Ryan Black partner, market leader, Cleveland/ Pittsburgh

16

Trinity Pension Consultants 202 Montrose West Ave., Suite 290, Copley 44321 (330) 668-3747/www.trinitypension.com

24

19

28

85

Retainer, fixed fees, by project

Actuarial consulting, administration, plan design, plan documents

Anthony J. Warren, Kevin A. Bergdorf, principals; Adam E. Warren, vp, finance and operations

16

Vantage Financial Group Inc. 6200 Rockside Road, Cleveland 44131 (216) 642-7878/www.vanfin.com

24

22

69

95

Commissions and fees

Design and implementation of employee benefit programs: health, dental, disability, life insurance, worksite marketing, flexible benefit administration, qualified retirement plan administration

William McCormick president, CEO

18

Chapman & Chapman Inc. 2307 E. Aurora Road, Suite B13, Twinsburg 44087-1952 (440) 287-7600 /www.chapmanandchapman.com

22

20

29

93

Commissions, fees

Employee benefits strategic consulting, benefits brokerage including voluntary and worksite, retirement plan consulting, executive benefits

Walter K. Chapman CEO

19

Buck Consultants, A Xerox Company 925 Euclid Ave., 18th floor, Cleveland 44115 (216) 861-9099/www.buckconsultants.com

21

21

23

75

By project, commissions, fixed fees, hourly rates

Health and productivity, retirement, communications, compensation, benefit audits, benefit outsourcing

John D. Cree principal, market leader

20

DS Benefits Group(2) 3555 Reserve Commons Drive, Medina 44256 (330) 725-0501/dsbenefitsgroup.com

20

20

22

97

Fixed fees and commissions

Innovative, customized insurance brokerage services, including government regulations and compliance, strategic planning, benefit design and financial analysis

Dino Sciulli president

21

National Associates Inc. 20325 Center Ridge Road, Cleveland 44116 (440) 333-0222/www.nainc.net

17

17

19

90

Fixed fees, hourly rates, retainer, project

Actuarial, administration, testing, plan design and consulting services for retirement plans; compliance, government filings, employee communication

Gerrit C. Kuechle president

22

Britton Gallagher 1375 E. Ninth St., Cleveland 44114 (216) 658-7100 /www.brittongallagher.com

15

16

80

90

Commissions and fees

Strategic benefits plan; health care insurance (medical, dental and life), health reform compliance, wellness programs and employee incentive programs

PJ Insana, executive vice president; Dennis Laughlin, president, CEO

22

Hylant 6000 Freedom Square Drive, Suite 400, Cleveland 44131 (216) 447-1050/www.hylant.com

15

9

60

90

Commission or fee

Full-service employee benefit brokerage and consulting services

Scott Dillabaugh president, Hylant Cleveland

24

Todd Associates Inc. 23825 Commerce Park, Suite A, Cleveland 44122 (440) 461-1101/www.toddassociates.com

14

9

52

80

Commission, fixed fee, project based

Health insurance, disability insurance, dental insurance, vision insurance, life insurance, executive compensation and benefits, section 125 plans

Edward J. Hyland Jr., president; Randy Cumley, Tim Fitzpatrick, executive vice presidents

25

Noble-Davis Consulting Inc. 30275 Bainbridge Road, Building B, Solon 44139 (440) 498-8408/www.noblepension.com

12

18

19

80

Fixed fees plus hourly rates for special projects

Open architecture platforms which allow us to work with any financial adviser. Balance forward accounting, compliance only services, daily valuation

Jan L. Davis, Pamela S. Noble, Karin D. French, partners

25

Willis 1001 Lakeside Ave., Suite 1600, Cleveland 44114 (216) 861-9100/www.willis.com

12

13

30

85

Fees and commissions

Full-service firm; consulting, program design and administration, all lines of product placement, audit services

Casey Petersen CEO

Source: Information is supplied by the companies unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. (1) Formerly Dorman Sciulli Advisors. (2) Formerly Dorman Sciulli Advisors.

RESEARCHED BY Deborah W. Hillyer

20140324-NEWS--23-NAT-CCI-CL_--

3/21/2014

4:05 PM

Page 1

MARCH 24 - 30, 2014

Bitcoin continued from PAGE 1

It’s the coffee shop’s loss if Bitcoin (the concept gets a capital letter, the currency doesn’t) plummets in value and turns out to be a total fad.

Many people say it will. Among them are former Federal Reserve chairman Alan Greenspan and New York Times economics columnist Paul Krugman.

Revy agrees more with some of the people who’ve made big Bitcoin bets. People such as Marc Andreessen, who helped create Netscape, the first popular web browser, and the Winklevoss twins, who won a big stake in Facebook after suing founder Mark Zuckerberg for supposedly stealing their idea.

Bitcoin backers cite a variety of advantages that could help the digital currency become popular with people other than tech enthusiasts and hardcore Libertarians who would rather use money that isn’t controlled by the government.

One of the main selling points is that merchants that accept bitcoin don’t need to pay fees associated with credit cards.

As for Revy, the former financial planner said he long has been interested in alternative currencies. He mainly wanted to be able to offer his customers another way to pay.

“Maybe we’re way ahead of the curve. Or maybe not. Maybe … we’re right at the brink of something that could be a new way, or at the very least another way of conducting commerce,” said Revy, who started the coffee shop at 17823 Detroit Ave. with Bryan Davis last October.

Perhaps, though as of last Wednesday, March 19, only three coffeeproper customers actually had paid with bitcoin.

Not a groundswell yet Another of those three customers is Nikhil Chand, a newly minted Bitcoin consultant who recently helped The Wine Spot set up its point-ofsale system so that the beer and wine merchant at 2271 Lee Road could start accepting the digital currency.

Now Chand and Wine Spot coowner Adam Fleischer are talking to other businesses in the Lee Road area in an attempt to create a destination for people who want to spend bitcoin in Northeast Ohio. Some of those businesses are exploring the idea, according to Fleischer.

To Fleischer, the decision to accept bitcoin “was a no-brainer” once he figured out how to do it. With Chand’s guidance, The Wine Spot downloaded a piece of software called BitPay onto an iPod Touch that it already owned, connected the software with the store’s point-ofsale system and trained Wine Spot employees on how to enter bitcoin payments into the system.

As a result, the Cleveland Bitcoin group, which was formed last summer on Meetup.com, held one of its regular meetings at The Wine Spot in early March.

The store also has attracted a few dozen other bitcoin customers, some from beyond Cleveland Heights. It helped that both the Sun News and the Heights Observer wrote about the Wine Spot’s decision to accept bitcoin.

“They’re coming to us just because we’re accepting bitcoin,” Fleischer said.

Coinmap.org lists about 1,500 companies that accept bitcoin in the United States; only 10 are in Northeast Ohio. Some of them, such as Chand’s CoinNEO consultancy, are run by a single person.

Nationwide, the biggest retailer that accepts bitcoin is probably Overstock.com. Electric car maker Tesla

CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

BUYING WITH BITCOIN PROVES DIFFICULT If you own an iPhone and want to buy something with bitcoin, be warned: It isn’t easy.

I eventually succeeded in buying one $3 cup of coffee with bitcoin, but it took a while. First, I had to get my hands on some bitcoin. Nikhil Chand, a local Bitcoin consultant, told me to open an account on Coinbase.com, a well-known site in the world of digital currency.

So I did. Then, with nothing but my email address, Nikhil generously sent me .0078 bitcoin (which was worth $5 at the time). I could have bought bitcoin myself through Coinbase, if I had given the website my bank account number (I’m not ready for that).

The next day I visited coffeeproper, a coffee shop at 17823 Detroit Ave. in Lakewood. When I went to buy a coffee, co-owner Frank Revy pushed some buttons on his iPad mini and presented me with a QR, or quick response, code, which is like a bar code for smart phones.

An Android user would be able to download a Bitcoin app capable of scanning that code and sending the money straight to coffeeproper. But Apple recently banned all apps that Motors does, too, as does Richard Branson’s spaceflight startup, Virgin Galactic, which just sold two tickets for a suborbital flight to the Winklevoss twins. PayPal is thinking about accepting bitcoin as well.

The local companies on Coinmap.org include David’s Grill and Bar in downtown Cleveland, Underhill’s Games, which is a board game store in Cuyahoga Falls, and Aspire Auctions, a Cleveland company that sells art, jewelry and other goods online.

True believers The computer services company in Euclid that Virgin Galactic operates in his free time is listed on the website as well, but the main way he makes money off bitcoin is by trading it. As of March 12, Emick said, he had earned about $5,000 by buying and selling bitcoin, mostly by connecting with people on a website called LocalBitcoins.com.

Emick said he thinks Bitcoin has a future as a currency. That’s why he ended up convincing a coffee shop in his neighborhood, Lake Shore Coffee House, to accept it.

A lot of people who buy bitcoin from Emick want to use it for gambling online, which is legal in some states. Today, it’s tough to use cred-

actually let people spend bitcoin, citing vague legal reasons for the move.

Anyway, I do have a regular QR code reader on my iPhone, so I held my phone up to the iPad mini and scanned the purchase code, which produced a giant string of letters and numbers that work like a digital address. I copied the characters into my account on Coinbase so that my bitcoin would know how to get to coffeeproper and then hit the “send money” button. But it didn’t work.

Not sure why. Revy’s theory is that the purchase code was an older one from a previous transaction.

The next day, after conducting a few Internet searches about how to make a bitcoin purchase using an iPhone, I tried again. This time I entered my Coinbase account information directly on the iPad mini at coffeeproper. And it worked! I spent .004917 bitcoin, and received a cup of coffee.

But there was still one complication: Though the iPad mini at coffeeproper wasn’t set up to remember my password, it also didn’t automatically log me out. Scary.

So, for now, if you love bitcoin, buy an Android.

— Chuck Soder it cards for such purposes.

About a quarter of Emick’s customers are buying bitcoin as an investment, he said, describing a recent deal he did with a woman who bought $2,000 in bitcoins “just to sit on them.”

On the flip side, a local startup company gave away half a bitcoin last week as part of a contest. The company, VsMe Gaming, is developing software designed to allow people to play video games online for money — in this case, bitcoin.

A test version of the software had players compete against each other playing a classic game called Snake.

That tournament proved popular — people played the game nearly 12,000 times, according to Ari Lewis, one of three students at Case Western Reserve University who recently started VsMe Gaming.

They plan to launch the full version of the gaming platform by the end of the summer. If Bitcoin becomes a fad, that’s bad news for VsMe Gaming: The company doesn’t want to endure the 50-state skilled gaming review that they’d need to go through to exchange U.S. currency securely, via PayPal. But they’re not worried about Bitcoin.

“We don’t think it’s just a fad,” Lewis said.

■

Work continued from PAGE 1

As of last Friday, March 21, bitcoins were trading for about $580 each. However, consumers can buy fractions of a bitcoin so that they can make purchases using bitcoin without a large initial investment.

Right now, the digital currency appeals to a few niche groups. Need to transfer large amounts of money around the world? Bitcoin can make the process easy and fast. No need to wait for bank approval or pay fees to Western Union.

Want to gamble online? You might want to buy bitcoin if you want to ensure that your transaction is secure, because PayPal doesn’t process gambling transactions, even in states where it is legal.

Live in a country such as Cyprus, which last year swiped huge amounts of money out of citizen bank accounts to keep the government afloat? Maybe bitcoin is an alternative for you.

Merchants eventually could offer lower prices to people who pay with bitcoin, because it costs less to accept than plastic. Travel could become easier if bitcoin becomes broadly accepted in other countries.

And it would be nice to avoid overdraft fees and be able to send money to friends via the Internet, knowing nothing other than their email address.

But is Bitcoin ready for mainstream adoption in the United States? No, according to Nikhil Chand, who recently formed a Bitcoin consultancy called CoinNEO. For one, it’s not that easy to use, especially if you want to pay in person with an iPhone (for more on how that works, check the other story that starts on this page). Plus, today, the Bitcoin network can

23

process only seven transactions per second, which won’t cut it if the technology really takes off.

“There is so much room and need for innovation, especially for the end-user experience,” Chand said.

Plus, Bitcoin suffers from a lack of legitimacy. For one, it was the currency of choice for Silk Road, a website that had been used to sell drugs and other illicit goods. Silk Road hurt Bitcoin’s reputation, even though the government was able to

“There is so much room and need for innovation, especially for the end-user experience.”

– Nikhil Chand founder, CoinNEO shut down the online market.

And hackers have found weaknesses in the technology. One of them contributed to the fall of Mt. Gox, a Tokyo-based exchange that recently lost hundreds of millions of dollars in bitcoin and filed for bankruptcy in Japan.

But that problem didn’t touch the heart of the technology, the “Bitcoin blockchain,” which records every transaction, according to Ari Lewis and Sagar Rambhia.

The two Case Western Reserve University students — who have formed an online video game company, VsMe Gaming, which eventually plans to let people play against each other for bitcoin — aren’t among those who like the digital currency because the government has nothing to do with it. They want the government to come up with sensible Bitcoin regulations.

“We want it regulated, because that means the U.S. government thinks it’s legitimate, and it’s here to stay,” Lewis said.

■

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20140324-NEWS--24-NAT-CCI-CL_--

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3/21/2014

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MARCH 24 - 30, 2014

Group: Pro-tax coalition says multicounty vote isn’t ‘realistic’ continued from PAGE 1

Proponents of the tax, working through a group called the Coalition for Greater Cleveland’s Future, are wary of any effort against the sin tax. Their concern is that a failure to extend the sin tax will start a cascade of events that will cost the city one or more of its big league teams.

Pattakos, a Cleveland attorney, and businessman Alan Glazen, another anti-sin tax leader, don’t see a defeat of Issue 7 as something that would lead the teams to look for new homes in new cities.

“I just find it impossible to believe that would happen,” Pattakos told Crain’s after the meeting.

“There are only so many cities with the infrastructure and fan base to support a big-league franchise.”

Should the tax extension be defeated, CAST wants the teams and public officials to sit down and over the next few months review the situation with the sports facilities for voters. First, it wants the teams to do a better job of justifying the money they want to see spent on the buildings. Then it wants them to find a better way to pay those costs.

It is offering two alternative financing proposals.

The first is a multicounty 0.1% sales tax levied on purchases in Cuyahoga County and as many as 10 nearby counties, the residents of which attend games or watch them at home on television. It sees this

“Adding $5 to every ticket, including ‘Disney on Ice,’ will mean fewer people attending games, which would result in fewer people frequenting downtown businesses, etc.”

– Nancy Lesic spokeswoman, pro-sin tax coalition approach as a good way to promote regionalism.

CAST also suggests what it calls a “facility fee” of $3 to $5 on every seat sold at the three buildings.

That fee, it says, would cover the costs of improvements and would put the cost where it belongs, on people who patronize the facilities.

Not so fast Nancy Lesic, spokeswoman for the pro-tax coalition, said in an email that the tax on the ballot makes more sense than CAST’s alternatives.

For one, Lesic noted, state law currently does not allow for taxes across county boundaries. She said proposing a multicounty tax may “make for a good sound bite, but it’s a very simple-sounding proposition for a very involved and complex issue.”

“It’s not realistic to expect that our state legislature — which will

be on recess this summer — would pass any such piece of legislation in time to allow a multicounty vote (approval of which would be far from guaranteed) before the tax expires in 2015,” Lesic wrote.

She also argued in her email that any ticket surcharge would have its flaws, too.

“Any such increase, whether it be the admissions tax, facility fee or other such surcharge on every ticket, will have the same result — Cleveland will be less competitive in attracting events and fewer people will come downtown,” she wrote, noting that Cleveland’s admission tax is the highest in a region that includes Buffalo, Pittsburgh, Columbus, Cincinnati, Indianapolis, Louisville and Detroit.

“Adding $5 to every ticket, including ‘Disney on Ice,’ will mean fewer people attending games, which would result in fewer people frequenting downtown businesses, etc.,” Lesic wrote.

Trolling for dollars The three teams — the Cleveland Browns, Cavaliers and Indians — began formal conversations about building improvements with city and county officials about a year ago.

The revenue from a 20-year extension of the sin tax would pay for a round of capital improvements on three buildings approaching middle age. The tax works out to

though, are scoreboards. Cavaliers and Indians executives told County Council that upgrading scoreboards at Quicken Loans Arena and Progressive Field to high-definition standards would cost $9 million and $14.5 million, respectively.

Issue 7 opponents object to spending public money on what they see as advertising boards that will generate revenue for the teams.

State Sen. Shirley Smith, DCleveland, singled out the scoreboards when she announced her opposition to the sin tax extension in January and offered a new twist — a guarantee of sorts of winning teams.

“Before tax dollars are doled out for state-of-the-art scoreboards and other stadium improvements, taxpayers have a right to see a return on their investment,” Smith said in a prepared statement. “This concept of performance-based metrics is not uncommon when tax dollars are invested in other private businesses, so why should professional sports teams be any different?”

If voters reject the 20-year extension of the tax on May 6 and no alternative is approved by the time the sin tax expires in July 2015, the city and the county, as landlords, could be forced to cover the costs of major repairs on the three buildings for 20 years. The money would come from their general funds and could siphon dollars away from other city and county services. ■

one cent per glass of wine, oneand-a-half cents per bottle of beer, $3 per gallon for liquor and about five cents per pack of cigarettes.

The extension would continue tax collections until 2035 and raise about $260 million over its lifetime.

The Browns have begun spending $120 million on desired upgrades and necessary maintenance on FirstEnergy Stadium. The city of Cleveland owns that stadium and will pay $30 million of the cost spread out over 20 years. The city and the county are considering paying for additional repairs out of sin tax proceeds.

In January, the Cavaliers and Indians gave County Council itemized lists of desired repairs, updates and improvements at the buildings they occupy.

The Cavaliers’ list includes replacing a number of 20-year-old structural elements as well as a replacement of the roof, heating and cooling systems, seating and windows. The team estimated the cost of its wish list, which it would like to complete over the next decade, at between $55 million and $65 million.

The Indians’ list also includes heating and cooling system components, plumbing fixtures and pumps, concession stands and seating at an estimated cost of $60 million to $70 million.

The score on scoreboards The lightning rods on both lists,

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25

THEINSIDER

THEWEEK MARCH 17 - 23 Stopped in its tracks: National Interstate Corp. won the battle to maintain its independence as a publicly traded company. American Financial Group Inc. said its Great American Insurance Co. unit dropped its tender offer to buy all the shares of National Interstate it doesn’t already own in light of an announcement by the U.S. District Court for the Northern District of Ohio that it would grant a motion for a preliminary injunction enjoining completion of the tender offer. American Financial already owns about 52% of National Interstate, a provider of specialty transportation insurance in Richfield. Alan Spachman, the founder of National Interstate, had opposed the tender offer of $30 a share because he believed it undervalued the company.

Positive vibe: Positively Cleveland president and CEO David Gilbert unveiled a new travel and tourism campaign that he hopes will bring at least 4 million more tourists annually to the region in five years. Gilbert told civic leaders how his organization, the area’s convention and visitors bureau, will “change the narrative about Cleveland” with the branding campaign. He also told Crain’s that Positively Cleveland will spend $1.5 million a year over the next three years to target convention and meeting planners and leisure visitors in a region that includes Buffalo, Columbus, Detroit, Erie, Pittsburgh and Toledo.

Capital bonanza: Gov. John Kasich is recommending the Legislature allot nearly $130 million to capital projects in Northeast Ohio. His biennial capital budget shows $98.2 million going to the region’s state universities and $31.6 million to parks and community projects. The renovation of the Cleveland waterfront was a winner, though not to the extent local boosters had hoped. The budget shows the state kicking in $5 million toward the $47 million needed for a pedestrian bridge to connect the Lake Erie waterfront with the rest of downtown, and $3.5 million to help pay for a $16.7 million riverfront park on the east bank of the Flats.

Prime time to buy: A new study by real estate website Zillow of the nation’s 35 largest metros ranks Cleveland the top buyers’ market in the country. Buyers’ markets tend to have lots of inventory, steep price cuts and homes that linger on the market. The Cleveland-Elyria-Mentor MSA is above Philadelphia, Tampa, Chicago and Pittsburgh on the list of top buyers’ markets.

Up with downtown: Downtown Cleveland Alliance, which oversees marketing, maintenance and safety in downtown Cleveland, has retained the Cleveland Urban Design Collaborative and Denver-based Progressive Urban Management Associates to produce a five-year strategy plan by June for the central business district. “We’ve had record investment in downtown Cleveland. Our job now is to keep the positive momentum going,” said Joe Marinucci, president and CEO of the alliance.

Short subjects: For the second time in less than two years, Westfield Bank is acquiring a Northeast Ohio institution — this time, Valley Savings Bank, a two-branch institution based in Cuyahoga Falls … Cleveland Play House’s 99th season, the first scheduled by artistic director Laura Kepley, will feature a classic Lillian Hellman drama and the world premiere of a comedy from Cleveland playwright Eric Coble …

Jonathon Sawyer, chef and owner of The Greenhouse Tavern and Noodlecat restaurants in Cleveland, was named a finalist in the James Beard Foundation Awards for 2014. He’s a finalist in the category of Best Chef: Great Lakes, which encompasses Illinois, Indiana, Michigan and Ohio.

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

He was never happier to see a line in his life

Learning to hack for a good purpose

Wired to spend cash in a wireless world

Ah, there’s the beef.

You might think I was disappointed when I arrived at the corner of East 31st Street and St. Clair Avenue in Cleveland, hungry and with only 10 minutes to spare, preparing to get myself a Slyman’s corned beef sandwich.

The line was out the door of Slyman’s Restaurant and down the block. I would have no time to get a copy of Cleveland’s finest sandwich (if not its best meal, generally — hey, this is a notebook, not an unbiased story!)

I was overjoyed. That’s because my last few trips to the famous eatery, though admittedly months apart, caused me great concern.

Business had been slow and tables readily available — not something I was used to seeing. The loss of Midtown businesses, changes in eating habits, more restaurants downtown — these and other factors all impacted Slyman’s, servers and owner Freddie Slyman told me on several occasions.

But two things were buoying recent sales, I was also told this week — St. Patrick’s Day kept the place busy for nearly three weeks, and counting, while the new casino was sending customers there.

I can only hope those trends will sustain the iconic deli until my next visit.

It was the only way I could get to sleep.

— Dan Shingler

Case Western Reserve and Cleveland State universities hope to turn a handful of students into top-notch hackers.

Starting this fall, both universities will offer courses in a new curriculum where undergraduate engineering and computer science students will learn how to break into — and then protect — hardware, software and data.

Researchers at both universities teamed up to develop the curriculum, which they say is among the first comprehensive cyber security education programs in the country offered to undergraduates.

Cleveland State and Case Western Reserve also plan to offer versions of the courses to graduate students.

The team of researchers spearheading the project are Swarup Bhunia, associate professor of electric engineering and computer science at CWRU; Chansu Yu, chair of electrical and computer engineering at Cleveland State; and Sanchita Mal-Sarkar, associate lecturer of computer and information science at Cleveland State.

The researchers received a total of $200,000 in grants from the National Science Foundation to support the courses.

— Timothy Magaw

A private equity firm in Chagrin Falls has committed $80 million to a newly formed Boston-area firm that is focused on developing and managing wireless infrastructure, such as cell towers, in an increasingly digital world.

Peppertree Capital Management Inc. has been here 19 times before: Including this most recent investment of equity and debt financing in Blue Sky Towers LLC, it has founded or invested in 20 tower companies.

The need for more wireless infrastructure is clear, said Ryan D. Lepene, managing director of Peppertree Capital.

“Every one of the sites that you build is capacity-constrained,” he said, citing how the number of people using wireless devices has surged.

“As more users demand more from their phones, that means they’re pinging the tower more,” Lepene said. “The carriers can’t solve their network issues fast enough.”

Blue Sky, founded by Tom Remillard and Jim Rech, who together have roughly four decades of experience in the wireless business, aims to provide wireless carriers — for example, Verizon and AT&T — and their real estate vendors with “unparalleled real estate access,” using Remillard’s “proprietary database of cell site-friendly landlords.”

Read: Blue Sky has access — through licensing of that database — to people in major metropolitan markets across the country, and quickly can use it to find tower and rooftop sites when a carrier comes calling in need of improved coverage in an area, Lepene said.

— Michelle Park Lazette

WHAT’S NEW

BEST OF THE BLOGS Excerpts from recent blog entries on CrainsCleveland.com.

Learn from Cleveland

PRODUCT: SprayLube 990 COMPANY: Buyers Products, Cleveland Buyers Products, which makes products for the mobile equipment market, aims to keep things moving with its new SprayLube 990, a lubricant with hundreds of uses.

The new SprayLube 990 “penetrates and loosens rust and corrosion on metal-to-metal parts,” the company says. It’s formulated with corrosion inhibitors and “protects surfaces as well as lubricates and displaces moisture,” according to Buyers Products.

SprayLube 990 is designed for lubricating and protecting a variety of parts, including pintle hooks, drive train sprockets and door hinges.

“The 15-ounce can of SprayLube 990 contains 28% more lubricant at one-third of the cost of other lubricants,” says Brian Smith, marketing manager at Buyers Products. “It’s an ideal solution for use on moving parts on trucks, trailers and other equipment.”

Buyers Products was founded in 1946. It also makes truck accessories and equipment including its SnowDogg line of snow plows, ScoopDogg line of snow pushers, SaltDogg line of salt spreaders, DumperDogg dump inserts and a line of toolboxes.

For information, visit: www.buyersproducts.com.

Send information about new products to managing editor Scott Suttell at ssuttell@crain.com.

■ A trip to Cleveland helped convince a Lansing, Mich., city council member that her city should pursue a downtown grocery store.

Lansing’s Fox TV affiliate reported that city and economic leaders “are in the early stages of developing a plan” to recruit a downtown grocer.

Council member Kathie Dunbar, who is spearheading the effort to put together a comprehensive recruitment package, says it’s about time.

“This is not a new concept; this is something residents downtown, business owners, anybody involved in urban revitalization has been talking about,” Dunbar said.

The story noted she is “modeling her ideas off two urban stores she recently visited in Ohio.”

After researching and visiting The Hills Market in Columbus and Constantino’s Market in Cleveland, Dunbar said she became convinced a Lansing store would be successful.

“The statistics they used for market analysis to open both those businesses had lower occupancy rates, lower density and lower income than what we have in Lansing and those stores are thriving,” Dunbar said.

Ads enter the stream ■ Cleveland is one of four markets targeted by new Planned Parenthood ads designed to promote ObamaCare with young women as the law’s first open enrollment nears its close.

TheHill.com reported that the group is airing new radio ads in English and Spanish “highlighting the importance of health in-

surance and the affordability of some options on ObamaCare’s marketplaces.”

The ads, which also will air via music streaming service Pandora, are targeting Cleveland as well as Houston, Dallas and Fort Worth, Texas.

Organizers with Planned Parenthood “are preparing to hold more than 500 enrollment events in eight states before March 31, along with sign-up drives specifically targeted at the Latino community in 15 cities,” including Cleveland, according to the story.

By the numbers ■ TheAtlanticCities.com examined “U.S. mega-regions,” a concept that dates back to 1957, when the economic geographer Jean Gottman coined the term “megalopolis” to describe the emerging economic hub that stretched from Boston to Washington, D.C. “The term came to be applied to a number of regions, including the vast Midwestern megalopolis that extends east from Chicago through Detroit and Cleveland and south to Pittsburgh, which Gottman dubbed ‘Chi-Pitts,’ and many more across the United States and around the world,” TheAtlanticCities.com said.

The website looked at North America today and says there are a dozen distinct mega-regions — mostly in the United States, but spilling into Canada and Mexico, too.

Northeast Ohio continues to be part of “Chi-Pitts,” which extends north and west from Pittsburgh through Cleveland, Detroit, Indianapolis, Chicago, and Minneapolis, taking in more than 50 metros.

Our mega-region is home to 41.8 million people and generates $2.3 trillion in output.

“Its economy is just a bit smaller than the United Kingdom’s, about the same size as Brazil’s, and bigger than all of Russia’s — equivalent to the world’s seventh-largest nation,” the story noted.

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