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VOL. 37, NO. 40

OCTOBER 3 - 9, 2016

Source Lunch

Business of Life To Cuba Now helps build international relationships. Page 20

TeamWork Online founder discusses firm’s milestone Page 21

CLEVELAND BUSINESS

The List Highest-paid public company CFOs. Page 27

POLITICS

Ad strategies leaving room on local airwaves

By JAY MILLER jmiller@crain.com @millerjh

Clinton ads raise concerns about Trump’s ability to serve as commander in chief and his “What have you got to lose” appeal to black voters. (YouTube)

Changes in ad strategies by the major presidential and senatorial candidates are scrambling the Cleveland television advertising market this month — and maybe changing the way candidates reach voters in the future.

In October of recent presidential election years, political advertising has pushed commercial television advertisers to the sidelines, since Federal Communications Commission regulations give campaigns for federal office high priority when it comes to buying television ad time, including the ability to bump commercially contracted advertising, and to buy the time at the lowest reasonable rate.

With Ohio in the last several elections being a battleground state that attracts candidate ad dollars, that has meant that regular TV advertisers — car dealers, furniture stores, jewelers and more — in past years had a hard time buying television time as Election Day approached. Not only was space hard to come by and expensive, these advertisers, many of whom make marketing plans months SEE ADS, PAGE 26

FINANCE

Trump ads tout his stand on border control and cite differences between Clinton’s job policy and his. (YouTube)

EDUCATION

Riding high on robust investing The exodus continues

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

Private equity funds typically take several months, if not years, to draw enough investors and capital to hit their target goals.

But Align Capital Partners, the newest private equity firm to launch in Cleveland, closed its first fund in September after just about three months. And Align, which is branding itself as ACP, didn’t just hit its $250 million target; the firm cleared it by a cool 30%, closing at $325 million.

Entire contents © 2016 by Crain Communications Inc.

That’s pretty special, especially for a new firm that’s (technically) never made a single investment.

ACP is a bit different, though. Despite being a fresh name in the private equity space, where reputation and track records are the keys to attracting investors, the firm is run by a trio of former Riverside Co. principals who have worked closely together on plenty of deals and managed portfolio companies before starting their own business. Their fund also takes a middle market strategy, which seems to be resonating with investors.

“A lot of people do have the opinion that there is attractive return potential if you find the right manager,” said ACP partner Chris Jones. “And that’s where we benefited from a SEE FUNDS, PAGE 6

at University of Akron

By RACHEL ABBEY MCCAFFERTY rmccafferty@crain.com @ramccafferty

The tumult at the University of Akron didn’t end when Scott L. Scarborough stepped down in May 2016, about two contentious years after taking on the role.

Nor did it stop when Matthew J. Wilson, previously the dean of the university’s law school, was named interim president in July.

Since Scarborough’s announcement, six other leaders — all of whom he had hired at the university in 2014 and 2015 — have left. Given those departures and the retirement of the

university’s controversial branding as “Ohio’s Polytechnic University,” many of Scarborough’s moves have been unwound in swift order during Wilson’s presidency.

On the personnel front, Lawrence Burns, the former vice president of advancement, was the first to announce plans to leave in early July.

Todd Rickel, dean of the College of Applied Science and Technology, followed the next day. Burns was given a one-month paid administrative leave and Rickel was placed on paid leave for 120 days.

In August, Mario R. Garzia resigned as executive director of the university’s Center for Data Science, SEE AKRON, PAGE 22

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PA G E 3

New NFLPA regulations put agents in tough spot EMPOWERING

By KEVIN KLEPS kkleps@crain.com @KevinKleps

Vince Calo represents six NFL players — four of whom are in their first or second year in the league.

That alone might seem to make the Mentor resident more inclined to reduce the fee he charges the players he represents, since doing so could bulk up his client total.

But Calo has joined a long list of licensed agents who are furious that the NFL Players Association has set the default fee at 1.5%, which is half of the 3% maximum that agents can charge their clients.

“It’s frankly pretty disgusting,” said Calo, a West Geauga High School graduate whose clients include former Cleveland Browns defensive lineman (and current New England Patriot) John Hughes. “To make the default percentage 1.5, I won’t do it.

We can still keep it at 3%.”

In March, the NFLPA decided against reducing the 3% max its agents are permitted to charge. Five months later, the Players Association announced that new standard agreements would include a default fee of 1.5%.

“So basically the agent and player will both have to sign off on any fee change from the 1.5%,” NFLPA president Eric Winston told Sports Business Journal.

The new regulations, which go into effect Nov. 1, angered many in an already-difficult industry — one in which the success rate might be as low as that of past Browns general managers. (The NFLPA didn’t respond to Crain’s request for comment.)

“I don’t think you’re going to come across an agent who is in favor of this,” said Andy Simms, a Solon resident whose PlayersRep Sports Management counts more than 50 NFL players and seven coaches (mostly NFL assistants) as clients. “If you meet someone in any business or any field and tell them you’re going to cut their revenue in half, it’s probably not going to be looked at in a positive way.”

‘A lot of expenses’ NBA agents — Calo’s partner, Aaron Turner, who represents Boston Celtics guard Terry Rozier, is one — can charge their clients as much as 4% for their services. The NHL and Major League Baseball don’t have a maximum percentage, but MLB agents tend to make at least 4% in commissions.

Granted, there are more NFL players — 1,696 in all, plus practice squads that could put the total over 2,000 each week — but there were about 800 certified agents in 2013.

Another 103 agents reportedly passed the most recent exam in July.

“A lot of people try it out and never have one draft pick or one guy make the team,” said Calo, a 38-year-old of counsel at McCarthy, Lebit, Crystal & Liffman Co. who has been an agent since 2010. “The statistics are pretty crazy.”

The agents who are fortunate enough to attract a few prospects prior to the draft are then faced with a list of mounting expenses, from personal training to fronting the player’s cost of living. In an ideal world, they are reimbursed once their client starts getting paid six- or seven-figure

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Cost: $25 for you and a guest To Register Call: 216.672.6028 NFL agent Andy Simms is shown with clients Devin McCourty, left, and Stevan Ridley at Super Bowl XLIX. (Contributed photo)

‘Don’t blame the players’

Vince Calo

salaries, but when players don’t make it or have a short-lived career, that becomes much more problematic.

“We have a lot of expenses,” Simms said. “It’s become customary in our industry to pay for training. Draft expenses are very high. It’s just something we pay for.”

That’s one of the reasons both Calo and Simms said they don’t want to work for any less than 3%.

“For what I do for clients, which is not only negotiate NFL contracts, but general counsel, marketing, life management, helping with everything from starting guys’ foundations to negotiating their car deals, I can’t work for 1.5%,” Calo said.

Simms — who is one of seven licensed agents at PlayersRep, and has the McCourty twins, Devin and Jason, as clients — said “the plan” is to keep the company’s representation fee at 3%.

“At the same point, I realize there are going to be plenty of agents that don’t,” Simms said.

Calo believes that group will include young agents who are trying to break into the business and use the reduced fees as a caveat to bring in players. Simms, though, thinks one of the biggest threats to the business is that some of the largest agencies will reduce their fees, since they can offset those losses with an increase in clientele.

“Those firms will be quicker to do it,” Simms said. “You saw some of that last year before this was even a rule.

They have the biggest profits. They can undercut that. They don’t mind losing money on a player for three or four years if they can get to the second contract and be successful.”

Even getting to a second contract — which is when players, and agents, often make the most money — is a challenge in the NFL. According to a 2016 Wall Street Journal analysis, the average career length has fallen from 4.99 years in 2008 to 2.66.

Simms, who says PlayersRep has a “very healthy business,” said agencies that accept a standard fee of 1.5% will find it “difficult or near impossible to be profitable.”

He added that agents will “have to figure out new revenue streams” and new ways to run their business.

“That’s the way it’s going to be now,” Simms said.

To be successful in the cutthroat business, “you need a big-money investor,” Calo said.

He has one in Gregg Levy, a McCarthy Lebit principal and an investor with Red Restaurant Group.

Levy, Calo and Turner are part of Verus Management Team. Turner represents Rozier — who played at Shaker Heights High School and the University of Louisville before getting selected 16th overall by the Celtics in 2015 — and Jakarr Sampson, a Cleveland native who is entering his third year in the NBA. The group recently added Miles Welo, a Mansour Gavin attorney, as an NFL agent.

“We work around the clock, do everything for these guys,” Calo said.

“They appreciate it. It’s always a David vs. Goliath. There’s always little victories I have for myself, like John Hughes signing a damn good second contract (with the Browns in 2015, a year before he was released) for a guy who wasn’t a big-time starter.”

The second contract is a Super Bowl of sorts for agents, who can only do so much with rookie contracts, which have set values for every pick in the draft. But Calo and Simms stress that agents earn their money in the early years, too, with services that go well beyond NFL contracts.

“I don’t blame the players,” Simms said of the amended NFLPA regulations. “If the players are told you can lower this, there’s not a person who doesn’t want to lower their bills.

They don’t see what it does to the individual (player) and the quality of representation. They see it as lowering the bills, and it’s hard to blame them. It puts us in a very difficult spot.”

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The first buildings are open at Copper Creek Lodge Apartments in Brimfield Township. (Stan Bullard)

‘Quiet’ $30M apartment complex rises in Brimfield

By STAN BULLARD sbullard@crain.com @CrainRltywriter

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The first three buildings, the pool and a lodge-style clubhouse are done and tenants are starting to move in at the first phase of Copper Creek Lodge, a $30 million apartment complex in Brimfield Township that runs counter to most urban-loving multifamily trends.

Near the Interstate 76 interchange with state Route 43, the 62-acre project at 1100 Copper Court is 10 to 20 minutes from Kent State University and downtown Akron. Not exactly walking distance to work or nightlife like trendy urban projects, but in Copper Creek’s own terms, “quiet but close to the action.”

Pat Finley, chairman of Omni Property Cos. of Warrensville Heights which is developing Copper Creek through Omni Brimfield LLC, sees it fitting long-term, traditional development patterns.

“It’s in the path of development along I-76 from Akron and 43,” Finley said. “There are few sites this size available, much less zoned for apartments, in the area. Plus we’re 10 to 15 years younger than competing properties.”

Although Kent, which technically is the mailing address for Copper Creek, has multiple new student-housing developments, Copper Creek is oriented to young professionals and empty nesters who want more space. It’s for the troupe of folks willing to shell out upwards of $1,000 monthly for a one-bedroom to more than $1,600 monthly for a three-bedroom.

“Ten years ago, our prospective tenants were already home buyers,” Finley said, “but things have changed.”

However, until the latest apartment boom hit, Copper Creek’s site was typical for new apartments as developers pushed the outer edges of the market to find sites tenants would commute to in land-rich areas.

Gary Cooper, a Colliers International brokerage senior vice president who has peddled multifamily rentals for decades, chuckles as he weighs how Copper Creek does not

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One of the kitchens at Copper Creek Lodge Apartments.

fit today’s trends for walkability scores and walking distance to bars and restaurants.

“There’s a school of thought that the urban trend is a fad and won’t last,” Cooper said. “The suburban apartments are not as densely developed but are less costly to build and rent. Demand from some buyers remains strong for such properties.”

A Colliers study reports the region’s multifamily market is at 96% occupancy, showing room for more than the estimated 1,880 apartments under development in Cleveland and Akron.

The project is the first ground-up, market-rate apartment project for Omni, which previously has developed office and industrial properties.

However, Finley notes the firm’s principals have always invested in apartment ownership and starting to build them is a natural extension of their realty development skills.

“The Northeast Ohio office marketplace is in a flat job growth environment,” Finley said.

“We’re developers. We like to go where the tide is rising. There are few apartment developments like this in the Akron and Kent area. It’s also a natural complement to our senior citizen housing projects.”

Omni Brimfield has staked out the Volume 37, Number 40 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 441131230. Copyright © 2016 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00.

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site of the next building it will start constructing soon and expects to be available about Thanksgiving.

“We’re not getting ahead of demand but working around the weather,” Finley said. All told, another 11 buildings are planned for the next 24 months to build all 160 suites.

Copper Creek is rising in a failed, 250-acre subdivision that Omni Brimfield bought in 2015 from a lender. Redwood Living, a Beachwood-based builder of attached single-family homes it rents as apartments, is going in next door to Copper Creek with 180 units near single-family homes that went in before the housing bust.

Omni won OKs from the township two years ago by agreeing to install 200 fewer units than the prior plan allowed. The group is also selling lots to single-family home builders.

Ralph McGreevy, executive vice president of the Northeast Ohio Apartment Association trade group, said he believes Copper Creek’s location will fare well.

“They’ve covered the yin and yang of apartment development,” McGreevy said, between amenity-rich Copper Creek and Redwood, which offers tenants private entrances to their homes and their own yard at lower cost. "They’ll kill it.”

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THIS IS NOT THE END OF THE STORY. Using 3-P (public private partnership) strategies, our advisors are turning underutilized tracts of land into economic engines.

FUNDS CONTINUED FROM PAGE 1 good track record of managing and finding well-performing private equity investments.”

So while ACP is new to the market, its partners certainly aren’t.

But that’s just one part of the story.

Investors are quite keen on private equity right now in general, continuing a trend that has continued for at least a couple years in a low-interest market where more traditional investments aren’t providing the sizable returns investors are looking for.

And that’s all been making fundraising a little bit easier.

Market volatility is pushing some to private equity because of the mitigated exposure to market swings.

And as all this plays out, investors who got into private equity about five years ago are seeing their investments, in general, paying off, giving them more capital to invest and hunger to invest more. Those who think they may have underinvested are now overinvesting, it seems.

“The combination of all that is creating far short of a feeding frenzy,” said Riverside Co. co-CEO Stewart Kohl. “But I do think when you look at the last several years in this environment, it has propelled them to find more exposure to PE.” “It is kind of a perfect storm,” said Thomas Gentile, a cofounding partner at Beachwood’s BeaconCFO Plus, a firm that provides contracted CFO services, often working closely with private equity firms and their portfolio companies.

Coincidentally, September also saw Riverside close on its latest fund, Riverside Micro-Cap Fund IV, at $650 million, surpassing its $500 million target by 30%. That fund generally invests in U.S. companies with up to $7 million of EBITDA. The micro-cap team has invested in more than 50 platforms and exited 20 since 2005.

According to a September report from research firm Preqin, 2015 was

“The combination of all that is creating far short of a feeding frenzy. But I do think when you look at the last several years in this environment, it has propelled them to find more exposure to PE.” — Stewart Kohl, Riverside Co. co-CEO

a record year, with the highest-ever distributions to investors from private equity investments at $797 billion globally. That’s a 7% increase over 2014, and a massive 46% increase over 2013. Preqin credits this performance to heightened investor interest. In a June survey, 54% of fund managers reported more investor appetite in their funds.

But investor appeal doesn’t necessarily make life any easier for private equity firms.

“There are more private equity firms coming to the marketplace specifically indicating that they’re going after the smaller companies, and I definitely see this in the Northeast Ohio market.”

— Thomas Gentile, a cofounding partner at BeaconCFO Plus

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St. Servan Centre LLC paid a total of $700,000 for St. Peter Chanel High School, 480 Northfield Road, according to a statement issued by the Catholic Diocese of Cleveland. That figure includes $300,000 for personal property such as furnishings in the Bedford school building, which is not reflected in the $400,000 sale price for the real estate that was recorded Aug. 26 in Cuyahoga County land records. The sale was covered in a Page 9 story in the Sept. 26 issue of Crain's Cleveland Business.

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As this trend persists, the challenge will be finding the best investments as the money flows in. This creates more competition for target companies, particularly in the M&A world. And that’s contributing to a seller’s market, said Russ Warren, managing director at Beachwood investment bank EdgePoint Capital Advisors, particularly in the middle market space — the sector ACP happens to be focusing its buyout efforts — where a lot of companies are led by baby boomers with their minds on retirement.

“This does mean well-performing PE groups are going to continue to be able to raise capital,” Kohl said. “The challenge will be finding attractive ways to deploy it. There are a lot of buyers and only a finite number of sellers.”

And based on the money flowing into private equity right now, “we wouldn’t expect that to change anytime soon,” Kohl added.

Nonetheless, smaller and middle market companies are providing some of the best potential targets for reasons that include aging executives mulling over their succession plans, which could include selling.

“There are more private equity firms coming to the marketplace specifically indicating that they’re going after the smaller companies, and I definitely see this in the Northeast Ohio market,” Gentile said. “That’s where I think you’ll see growth in number of deals.”

The wider question today is: How long will this cycle last?

“I probably would’ve said two years ago I didn’t think it would get much better than this,” Kohl said.

“So it is kind of surprising. Many of us thought by now we would’ve seen some reversion to the mean.

There a lot of things you think might spook the market — volatility in public equity markets, Brexit, the U.S. presidential election — and we really haven’t seen that on the private side.”

“We’re riding the good wave right now,” Kohl said.

Correction

In a Sept. 26, Page 27 profile about Alana Jochum, the executive director of Equality Ohio, the name of Leelah Alcorn — the transgender girl who took her own life in 2014 — was misspelled.

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PA G E 7

McDonald Hopkins looks to drive change

By JEREMY NOBILE

Embracing change

jnobile@crain.com @JeremyNobile

Many law firms are testing strategies to build themselves for the future, and the Cleveland market is seeing that play out in different ways.

That includes everything from establishing viable new practices sure to be necessary in tomorrowâ&#x20AC;&#x2122;s business world â&#x20AC;&#x201D; such as those in burgeoning industries like 3D printing and medical marijuana â&#x20AC;&#x201D; to retooling client service through changes in pricing and more efficient and transparent project management. Some even are finding a place for artificial intelligence in their legal teams.

Yet, according to Altman Weilâ&#x20AC;&#x2122;s 2016 Law Firms in Transition survey, while thereâ&#x20AC;&#x2122;s an undeniable sense that law firms have to evolve, egos and a general resistance to change among some partners are impeding progress.

According to the study, 64% of law firms surveyed reported partner resistance to change as the biggest roadblock to actually changing. Only 4% of law firm leaders described their fellow partners as â&#x20AC;&#x153;highlyâ&#x20AC;? receptive to change.

Meanwhile, 93% of those leaders described improved efficiency as a permanent trend in the legal market.

But only 44% have significantly changed their strategic approaches.

So, while a Cleveland law firm acknowledging a need to adapt is far from novel, a firmâ&#x20AC;&#x2122;s top leader to publicly outline adaptive change among their top goals is still meaningful because of the tone it sets for other partners and in the regional legal market.

Thereâ&#x20AC;&#x2122;s a revolution underway reshaping the legal industry, and the next leader for Clevelandâ&#x20AC;&#x2122;s McDonald Hopkins LLC intends to embrace the change.

Indeed, Shawn Riley plans to position the firm to be among the innovators of change, and not simply a reactor to it. â&#x20AC;&#x153;We can chase the legal industry, do what other law firms are doing.

But we want to go a bit further, maybe beyond what other law firms are doing, and look to other industries to borrow their expertise,â&#x20AC;? said Riley, who became president of McDonald Hopkins on Oct. 1. â&#x20AC;&#x153;But we want to get out ahead and do these things everyone is talking about.â&#x20AC;?

Riley, a 21-year veteran of the firm, begins his nine-year term as former president Carl Grassi moves out of the position and into a chairman role, retaining a seat on McDonald Hopkinsâ&#x20AC;&#x2122; managing committee.

When campaigning for the president position, Riley said his platform included a message of adapting the business for the future.

And while some of those efforts are sure to carry an upfront investment, Riley said the financial aspect is the â&#x20AC;&#x153;least of my challenges.â&#x20AC;? â&#x20AC;&#x153;The biggest challenge will be shifting mindsets and convincing people that just because itâ&#x20AC;&#x2122;s always been done this way, itâ&#x20AC;&#x2122;s not the best way,â&#x20AC;? Riley said.

And thatâ&#x20AC;&#x2122;s a very real issue.

â&#x20AC;&#x153;We can chase the legal industry, do what other law firms are doing. But we want to go a bit further, maybe beyond what other law firms are doing, and look to other industries to borrow their expertise.â&#x20AC;? â&#x20AC;&#x201D; Shawn Riley, president, McDonald Hopkins LLC

Transformation Riley said exactly how the firm will evolve is a work in progress. But the

first step is making that a priority.

During a coming partner retreat, attorneys will spend much of their time reflecting on ways other industries have met the changing needs of their customers to spark innovative ideas.

Riley said he has some ideas in mind, but he doesnâ&#x20AC;&#x2122;t want to show his hand yet. â&#x20AC;&#x153;We want to be creative," he said.

"We want to look at problems other businesses have solved and learn from those experiences.â&#x20AC;?

New practice areas are on the table, including ones focused on issues surrounding medical marijuana and even drones.

Thereâ&#x20AC;&#x2122;s also going to be a â&#x20AC;&#x153;significant investmentâ&#x20AC;? in revamping legal project management, Riley said. The firm has data on how to be more cost-effective, he said, but investment will support high-quality analytical tools to tell clients up front what the cost of a project could be â&#x20AC;&#x201D; not unlike getting a quote from a contractor.

For efficiency, even artificial intelligence is on the table, Riley said. He was referring specifically to ROSS Intelligence, a Silicon Valley â&#x20AC;&#x153;legal robot,â&#x20AC;? as it has been called, built on the platform that powers IBMâ&#x20AC;&#x2122;s Watson cognitive computer. ROSS can answer legal questions based on inferences from its own research and already has found homes in Cleveland with BakerHostetler and even the Cleveland Clinic, whereâ&#x20AC;&#x2122;s itâ&#x20AC;&#x2122;s used for medical research. â&#x20AC;&#x153;I think itâ&#x20AC;&#x2122;s something even a firm of our size could embrace because it

is a tool that will allow us to provide a better finished product to our clients,â&#x20AC;? Riley said.

According to Crainâ&#x20AC;&#x2122;s most recent list of the region's largest law firms, published July 25, McDonald Hopkins is the 10th-largest firm in Northeast Ohio, with 78 local attorneys. Its total of more than 140 attorneys is spread out through six U.S. offices.

But could a legal robot lead to a smaller staff?

Not necessarily. The hope is that superior service could lead to more work, which in turn would require more people. â&#x20AC;&#x153;I donâ&#x20AC;&#x2122;t see much of our headcount shrinking as a result of technology,â&#x20AC;? Riley said. â&#x20AC;&#x153;If anything, I think the headcount will grow as we become more efficient and provide better costs to our clients.â&#x20AC;?

Riley wouldnâ&#x20AC;&#x2122;t talk about specific financials, but he said the firm has grown revenues annually since at least 2010. And while some practices might carry that growth a bit more than others, additional subsidiaries could be another way to increase revenues even further.

The firm currently operates a Washington, D.C.-based subsidiary called McDonald Hopkins Government Strategies, a business thatâ&#x20AC;&#x2122;s now 4 years old.

He said the firm is giving â&#x20AC;&#x153;serious thoughtâ&#x20AC;? to having another business related to law, like lobbying or a real estate planning practice. â&#x20AC;&#x153;What I would like to see, in three years, someone using us as a case study on how to transform the practice of law,â&#x20AC;? Riley said.

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CRAIN’S CLEVELAND BUSINESS

In search of ‘Who to Watch in Education’ candidates Crain’s “Who to Watch in Education” section, to be published on Dec. 5, highlights up-and-comers and innovators in Northeast Ohio’s education sector — whether in the classroom, in an administrative role or behind the scenes.

If you know an education leader, email sections editor Timothy Magaw at tmagaw@crain.com. Please put “Who to Watch in Education” in the subject line.

Send suggestions by noon on Monday, Oct. 17. Please include the person’s name, position, and a few paragraphs explaining why he or she stands out.

GIVING Y

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UR O o

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o

Top, one of the interior courtyards at American Greetings’ new world headquarters in Westlake. One of about 15 employee lounges is shown above, and at right is a stairwell that features illustrations done by employees. (Marc Golub for Crain’s)

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PA G E 9

This wall is adorned with company slogans.

American Greetings fills 13.5-acre canvas with a $150 million budget As American Greetings planned its new Westlake world headquarters and Creative Studios, it emphasized fostering creativity and collaboration plus providing natural light for 1,700 workers at One American Boulevard.

The social expressions maker’s five-floor operation houses more varied tasks than most HQs, like recording and photo studios, and merchandising areas for mockups of retail displays. Such needs spurred 20-foot ceilings on the first floor, which also afforded more sunlight.

“Most people are within 50 feet of natural light,” said Arthur Cernoia, the company's director of corporate services, in an interview.

There’s no corporate standard for space per worker. Cernoia said work stations are task-oriented. Larger ones are for artists or workers who handle products such as Care Bears or party supplies. Tasks taking less room, such as accounting, are in smaller work stations.

Art in the complex works to inspire creativity, and meeting places abound.

Meghan Bauco, associate marketing manager, said more than 100 meeting rooms may be reserved. An extraordinary feature is a one-third-acre, thirdfloor courtyard inside the building.

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CRAIN’S CLEVELAND BUSINESS

Opinion From the Editor

Bright idea is connecting cops with kids

Editorial

For the kids Four years ago, Cleveland voters put the city’s children above their own financial interests and approved a 15-mill levy for the Cleveland Metropolitan School District.

At the time, school and city officials promised better results — notably, a boost in graduation rates, enrollment and academic performance — all of which would be made possible by the levy’s cash infusion and a change in state law that gave the district more flexibility.

On Nov. 8, Cleveland voters will again decide whether the district is still deserving of those levy dollars. It’s not a tax increase, but rather a renewal of the measure voters approved four years ago. To its credit, at that time, the district didn’t seek a 10-year or even a permanent levy in the spirit of continued accountability.

So far, the district’s progress has been a slow — but ultimately steady — crawl. And while we and others would have liked to see more progress, we believe the district deserves a vote in favor of the measure, Issue 108.

Still, it would be difficult to argue that the district should be held up as the gold standard in public education reform. Graduation rates increased from a dismal 56% in 2011 to a much better, yet still disappointing, 66% in 2014. Enrollment appears to be a bright spot.

For the 2014-2015 school year, enrollment was 38,555, up from 37,967 the year prior — a figure Cleveland schools CEO Eric Gordon said recently was the highest figure since at least the early 1990s.

Meanwhile, the district received failing grades across the board on the state’s report card, though changing state standards may have contributed to those disappointing grades.

Complicating matters, the district and the teachers union continue to squabble over a new contract.

But despite these setbacks, it’s clear the district is moving the needle in the right direction.

After all, it would be irresponsible to take a breather only a few miles into this marathon.

Look forward

Lakewood Hospital stopped offering inpatient services in February as part of a plan to build a $34 million, 62,000-squarefoot family health center that would begin a transformation of health care services in the western suburb.

The plan, to put it mildly, has been controversial in the community, as a group called Save Lakewood Hospital has been relentless in trying to live up to its name. The group lost an initial court challenge and a 2015 charter amendment ballot issue, and it saw its preferred mayoral candidate lose to incumbent Mike Summers. But the hospital issue won’t die, and on Nov. 8, Lakewood voters will be asked to vote yes or no on Lakewood City Council’s approval of the Cleveland Clinic-led plan for the family health center.

We encourage Lakewood voters to vote in favor of the measure, Issue 64, and ratify the tough decision city council made to plan for the future of health care, not grasp at its past and get bogged down in more litigation in a fruitless effort to revive an outdated hospital.

A yes vote means that Lakewood, with the Clinic as its partner, can embrace an outpatient model for delivery of health care while retaining emergency care services vital to a community of more than 50,000 residents. The plan also enables Lakewood to pursue redevelopment of the hospital site — a significant tax-generating opportunity for an older suburb where available land is at a premium.

As Crain’s Stan Bullard reported last month, Lakewood is in the midst of an unprecedented housing market boom, driven by a resurgent downtown and significant investment in school renovations. Predictions of economic doom from the hospital’s closing have not come to pass.

Lakewood’s residents, its tax base and its ability to stay ahead of the curve in the delivery of health care are best served by a yes vote on Issue 64.

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com)

CLEVELAND BUSINESS

CLEVELAND BUSINESS

Managing Editor:

Scott Suttell (ssuttell@crain.com)

Sections editor:

Timothy Magaw (tmagaw@crain.com)

Contact Crain’s:

(216) 522-1383

A smart leader knows a good idea when she hears one.

Jacklyn Chisholm, president and CEO of the Council for Economic Opportunities in Greater Cleveland, is a smart leader.

Here’s the good idea, posed in the form of a question, brought to her by Margaret Thresher, vice president of marketing and communications for the council.

“What would you think,” Thresher asked Chisholm, “if Cleveland Police Chief Calvin Williams read a book to the students on the first day of the Head Start preschool year?”

Not every good idea, great leaders will tell you, has to involve splitting the atom or achieving world peace. Sometimes it’s as simple as reading to children.

The Council for Economic Opportunities in Greater Cleveland provides early childElizabeth hood education, personal and professional McIntyre development and support services to those struggling to make ends meet in Greater Cleveland. It operates the largest Head Start early childhood education program in Ohio.

As its leader, Chisholm encourages new ideas, and she encouraged Thresher to pursue hers.

“She loved the idea,” Thresher said.

But it wasn’t just about story time. It was about helping to heal the schism between poor and minority communities and the police.

“Feeling safe and having faith in our police officers has taken a hit with all of the national coverage on police-involved shootings.

It can be a source of uneasiness for many of our clients,” explained Thresher. “An embattled police officer can feel refreshed after connecting with a child, and the child can feel a sense of confidence and trust. It’s a mutually rewarding experience.”

That seems like a tall order for “If You Take a Mouse to School.” But it turns out that if you take a cop to school, good things can happen.

On the first day of classes in the William Patrick Day Head Start Center in Cleveland’s Central neighborhood, the chief got down low on the kids’ level and read to the 3- and 4-year-olds about the mouse’s school day, then pulled out his nephew’s favorite, “Llama Llama Red Pajama.” He paused after each page to ask them about the pictures. He high-fived the kids before he left, and answered all of their questions.

“It was clear something special took place and everyone in the room felt it,” said Thresher.

This month, that one idea, that single story time with the chief, becomes a full-fledged program called “Friendship through Reading.” Cleveland police officers will spend time with Head Start kids in classrooms across the city, reading books and, more importantly, forming bonds that will benefit the kids, the police and the community.

In addition to reading, the chief has discussed bringing squad cars to the schools for the kids to see, and maybe even the best ambassadors for the division of police, the Mounted Unit’s majestic horses.

The Cleveland Division of Police is in the midst of a transformation, driven in part by the consent decree with the U.S. Department of Justice over excessive use of force, and by a growing appreciation for what works. And what works is an engaged police department that is part of the community and responsive to it. And a community that embraces police as guardians is key, too.

Giving preschool kids a quality education, and fostering relationships that build trust between those children and the police, builds a story that has a much greater chance of ending in “happily ever after.”

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Cleveland Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by emailing letters@crain.com. Please include your complete name and city from which you are writing, and a telephone number for fact-checking purposes.

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com.

Please include a telephone number for verification purposes.

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

Web Talk Re: 2016 Browns An 0-16 record is quite rare in the NFL, and the Browns are not going to go 0-16. Fans and critics of football should recognize that most teams in the league have issues to overcome, and most of those teams didn't completely change their management and coaching staffs. The Browns have talent, but they clearly do not have what they need at the QB position.

They'll do better than 2-14; I'll give them 4-12. â&#x20AC;&#x201D; Roderick D. May

Re: Indians in the playoffs As long as you make the postseason, odds are for statisticians. You always have a chance as long as you're playing.

The Cavs had a great run until the finals, and managed to pull off the impossible after being down 3-1 to a 73-win team. Go Tribe, one series at a time. â&#x20AC;&#x201D; Melvin Gaines

Re: Ford, Mexico and Trump The point is, why didn't Ford build its small-car plant in the U.S.? Why was it built in Mexico? No one is saying they are cutting jobs, but why not add the jobs in the U.S. vs. adding the jobs in Mexico?

Detroit still needs more jobs. â&#x20AC;&#x201D; Adam You can blame the unions for moving jobs south of the border. â&#x20AC;&#x201D; Tal

Letter to the Editor Taking action The for-profit â&#x20AC;&#x153;educationâ&#x20AC;? industry is too often built on scamming students to pad executivesâ&#x20AC;&#x2122; bottom lines, and I appreciate the editors calling on the business community to stop propping up these shady schools. (Crainâ&#x20AC;&#x2122;s editorial: Bad profits, Sept. 19) These schools leave students unable to secure the good jobs they were promised and trapped under a mountain of debt, and they are often perpetrating these scams on the taxpayersâ&#x20AC;&#x2122; dime, with federal student aid funds.

I am working on legislation at the federal level to hold bad actors accountable â&#x20AC;&#x201D; the Students Before Profits Act and the Protecting Financial Aid for Students and Taxpayers Act. The former would stiffen penalties on for-profit schools and their executives for misleading students, while the latter would ensure our federal tax dollars are used for educating students, not for producing glossy brochures and TV ads. Whether itâ&#x20AC;&#x2122;s for-profit K through 12 charter schools or for-profit colleges, Ohioans have seen time and time again that when profit gets injected into education, itâ&#x20AC;&#x2122;s the students who pay the price.

U.S. Sen. Sherrod Brown Cleveland

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Personal View

Lawmakers must advance energy reform

GO TRIBE! AMERICAN LEAGUE CENTRAL CHAMPS

By MATT BRAKEY

Ohio Senate Bill 221 placed aggressive Energy Efficiency and Peak Demand Reduction (EEPDR) mandates on Ohioâ&#x20AC;&#x2122;s investor-owned utilities like FirstEnergy. These utilities are forced to reduce electric consumption and demand within their service territories through by an ever-escalating percent each year.

Ohio ratepayers have absorbed the costs associated with these mandates â&#x20AC;&#x201D; to the tune of hundreds of millions of dollars â&#x20AC;&#x201D; through hidden surcharges on their electric bills. However, ratepayers may have noticed on recent electric bills that these mandate costs are now being disclosed for the very first time.

Brakey Energy has gained a unique perspective on how the EEPDR mandates are affecting Ohio ratepayers. Brakey provides comprehensive energy management services to about 85 commercial, industrial, and institutional energy users that operate here in the state of Ohio. We have seen first-hand how the mandate costs have impeded Ohioâ&#x20AC;&#x2122;s economic progress.

Fortunately, Ohio Senate Bill 310 instituted reasonable reforms on the SB 221 EEPDR mandates. These reforms have included the broadening of what projects count for compliance, a streamlined opt-out mechanism that allows certain high-voltage customers to exempt themselves from the program, a two-year mandate freeze, and the creation of a bipartisan Mandate Study Committee to study the impact of the EEPDR mandates.

The Mandate Study Committee submitted a report with its findings to the Ohio House and Senate on Sept. 30, 2015. That bipartisan report correctly noted that Cleveland-area FirstEnergy residential customers were then paying an additional 5% every month in their electric bills because of EEPDR surcharges. Commercial and industrial customers were paying approximately 3% more.

These charges vary period-to-period, and have increased over time as the mandate requirements escalated. Fortunately, because of the two-year mandate freeze that was implemented by SB 310, EEPDR surcharges have recently moderated.

Unfortunately, SB 310â&#x20AC;&#x2122;s mandate freeze only runs through the end of the calendar year. As part of its fourth Electric Security Plan distribution rate plan, FirstEnergy will be restarting expensive compliance programs in January. In order for Northern Ohio businesses to continue to have access to competitively priced electricity, it is critical that the Ohio legislature advance new reform legislation.

There is no shortage of meaningful actions the Ohio legislature can take to build off the accomplishments of SB 310 and ensure EEPDR mandate costs do not continue spiraling out of control. All of the recommendations that the Mandate Study Committee put forth should be strongly considered by the Ohio legislature. However, the single most important thing our state government can do is to make participation in the EEPDR mandate program voluntary.

In exchange for not having to pay the EEPDR mandate electric bill surcharges, high-voltage customers submit periodic energy efficiency plans and follow-up reports to the PUCO. They also must forego all EEPDR program benefits like energy efficiency project rebates.

Some of these high voltage customers use more electricity in a day than a typical residential customer uses in a lifetime. Many of them spend hundreds of thousands â&#x20AC;&#x201D; if not millions â&#x20AC;&#x201D; of dollars per month for electricity. These customers pursue energy efficiency projects for a very simple reason: It makes economic sense to do so.

Yet what was not achieved during the passage of SB 310 was the recognition that self-directed energy efficiency is not something unique to Ohioâ&#x20AC;&#x2122;s largest customers. Smaller commercial, industrial and institutional customers also pursue energy efficiency projects to save money on their electric bills. Ultimately, determining whether a customer can take advantage of the streamlined opt-out opportunity based solely on voltage level is arbitrary and unfair.

Opponents and proponents of the EEPDR mandates are already starting to again fight over the fate of the program. But there is one reasonable outcome that there should be no disagreement on: Make program participation voluntary by expanding the streamlined opt-out opportunity to lower voltage customers.

Brakey is president of Brakey Energy, an energy consulting firm in Shaker Heights that works with some of Ohio's largest energy users.

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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.

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Southern Tier Commercial Cleaning Inc. 27672 Caroline Circle, Apt. A, Westlake Date filed: Sept. 6, 2016 Type: Employer’s withholding, corporate income, unemployment Amount: $75,852

Transnational Property Investments LLC 3473 Fairmount Blvd., Cleveland Date filed: June 8, 2016 Date released: Aug. 4, 2016 Type: Employer’s withholding Amount: $10,905

FMI Products LLC 21693 Drake Road, Strongsville Date filed: Sept. 2, 2016 Type: Employer’s withholding Amount: $65,552

Stoudemire Investment Group LLC 13916 Euclid Ave., East Cleveland Date filed: Jan. 18, 2007 Date released: Aug. 11, 2016 Type: Employer’s withholding, unemployment Amount: $10,655

Clear Process Solutions LLC 1512 Washington St., Chagrin Falls Date filed: Sept. 2, 2016 Type: Annual tax return Amount: $48,028

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valid until 1/1/17. Minimum service term, equipment, installation, fees, taxes, and other restrictions may apply. See coxbusiness.com. † Cox Business Visa® Prepaid Card available with qualifying new services ordered and activated between 9/5/16 and 1/1/17 with minimum 2-year contract. Customer must mention promotion code “reward promo” when placing their order to receive card. Account must remain active, be in good standing, and retain all services for a minimum of 30 days after install. Online redemption required following instructions to be mailed to customer after service activation. Online information to be submitted no later than 1/31/17. Void where prohibited. Limit one Prepaid Card per customer, total not to exceed $200. Allow 6–8 weeks after redemption for delivery. Cards issued by MetaBank®, member FDIC, pursuant to a license from Visa U.S.A. Inc. Cardholders are subject to terms and conditions of the card as set forth by the issuing bank. Card does not have cash access and can be used anywhere Visa debit cards are accepted within the U.S. only. Cards valid through expiration date shown on front of card. Valid in U.S., U.S. territories and Puerto Rico. Offer subject to modification or withdrawal at any time without notice. Other restrictions may apply. © 2016 Cox Communications, Inc. All rights reserved.

City Auto Wrecking Inc. 7902 Bessemer Ave., Cleveland Date filed: Sept. 6, 2016 Type: Corporate income Amount: $27,383

Chemam Inc. 250 Richmond Road, Cleveland Date filed: Aug. 19, 2013 Date released: Aug. 4, 2016 Type: Employer’s withholding, failure to file complete return Amount: $10,575

Hot Sauce Legacy Barbeque LLC 12310 Superior Ave., Cleveland Date filed: Sept. 6, 2016 Type: Employer’s withholding, partnership Amount: $22,183

T.K.P. Landscape Construction 1835 Ridgeview Drive, Seven Hills Date filed: July 19, 2011 Date released: Aug. 4, 2016 Type: Employer’s withholding Amount: $7,219

Realty Express Inc. 13353 Snow Road, No. 105, Brook Park Date filed: Sept. 2, 2016 Type: Corporate income, failure to file complete return Amount: $16,492

A Bar & Kitchen LLC 850 Euclid Ave., Suite 110, Cleveland Date filed: May 20, 2016 Date released: July 21, 2016 Type: Employer’s withholding Amount: $6,100

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Focus

FINANCE

Crain’s illustration by David Kordalski

Connecting the community Smaller banks open their eyes to tech long embraced by big banks

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

A

new application in development for First Federal Lakewood customers enables the processing of a small business loan through a smartphone in just five minutes.

In today’s tech-enabled, on-demand culture, that’s nearly as fast as it gets.

The app, which isn’t branded yet, but scheduled to be rolled out in the fourth quarter, is the result of a collaboration with tech vendors and a handful of mutual banks of which First Federal is a part.

But its premise really traces back to customers.

“Being a mutual, since our customers own us, we listen to them very closely,” First Federal CEO Tom Fraser said. “And what we kept hearing from our business customers is that they would like that quick turnaround.”

With this, clients could meet with a banker and have a loan for a new piece of equipment approved over lunch before their appetizers hit the table.

Smaller and midsize banks have been waiting for the so-called fintech market to develop for a slew of reasons, but most hinge on cost and access. And both are growing.

Today, bank executives commonly report a sense of urgency to not only get their tech offerings more in line with the wider market regional banks have set the tone in, but to even be innovators themselves.

“Everyone’s tech game is improving,” Fraser said. “We are looking for unique ways where we can carve out space or serve our customer segments in the ways they really want to be served.”

Chasing the big guys The idea of banks serving customers on their terms is as old as banking itself.

Yet, for banking as a whole, the pursuit of new and innovative customer-facing technology to enhance service and products for customers is a somewhat recent phenomenon that started materializing years ago, pretty much in line with the release of the iPhone.

For the smaller and midsize com-

panies in that community bank seg- which is the founding partner of the ment, the evolution has been just a Financial Solutions Lab, a $30 million, five-year initiative overseen by the few steps behind.

Center for Financial Services InnovaToday, the're catching up.

Large regional banks were the first tion to develop new fintech services.

That’s just one example of what to roll out these innovations, which touch everything from online and Chase is doing, like other large banks, mobile banking to payment services. to be ahead of the game, which alone carries a finanAnd that makes cial commitsense. Those comment small and panies have large midsize banks market shares to Amount that U.S. banks spent on could simply hold on to, feeding technology in 2015, according to a never match. the race to offer report by research firm Celent. That Not surprisingnew tech first in figure is expected to grow. ly, tech spend order to keep customers interested and happy. They on everything from customer-facing also have the coffers to financially services like mobile banking to secusupport innovation in the fintech rity is almost universally reported as segment — either in-house or both a necessary and rising cost for through partnerships with tech com- banks of all sizes. It’s also generally panies and firms in Silicon Valley considered one of the industry’s where hundreds of startups are chas- greatest challenges. ing the billions in capital flowing upstream.

What’s the return?

A 2016 report by research firm Celent found that U.S. banks spent more than Considering new tech generally $62 billion on technology last year, and requires significant investment, but that figure is expected to grow. doesn’t really generate revenue itself Consider JPMorgan Chase & Co., SEE BANKS, PAGE 14

$62 billion

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FINANCE

BANKS CONTINUED FROM PAGE 13 (though it can save money, in some cases), itâ&#x20AC;&#x2122;s reasonable to see why some companies view that as a headache in terms of running the business in todayâ&#x20AC;&#x2122;s low-interest banking market where growing margins is increasingly challenging.

The desire for a wider asset base to spread out those costs and gaining access to modern banking services small banks often donâ&#x20AC;&#x2122;t have â&#x20AC;&#x201D; like online banking, a rather basic service today's customers expect â&#x20AC;&#x201D; is one widely reported reason many smaller banks are deciding to merge with other companies today. â&#x20AC;&#x153;Fintech is playing a much broader role, especially around the community

banks,â&#x20AC;? said Sharon Dogonniuck, a principal at Ernst & Young specializing in bank M&A. â&#x20AC;&#x153;The old model is branch heavy and very retail oriented, the place where you walk into the bank and everyone knows your name â&#x20AC;Ś thatâ&#x20AC;&#x2122;s been their service delivery model. And some community banks find that challenging because it conflicts with the new mobile-delivery model.â&#x20AC;?

But now, banks are â&#x20AC;&#x153;opening their eyes,â&#x20AC;? she said, as they face customer demand and market competition, which includes non-traditional banks. â&#x20AC;&#x153;Theyâ&#x20AC;&#x2122;re saying, man, itâ&#x20AC;&#x2122;s really hard to generate revenue. So what about my business model? Do I have to change my business model?â&#x20AC;?

Evolved offerings Itâ&#x20AC;&#x2122;s been a steady change, but one thatâ&#x20AC;&#x2122;s seemingly peaking in terms of

priority today, driving this blossoming sense of urgency for smaller banks to catch up.

And many are doing just that. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re seeing customer behaviors on how they want to do their banking changing at a relatively quick pace,â&#x20AC;? said Jon Park, Westfield Bank's chairman and CEO. â&#x20AC;&#x153;So banks are investing and adapting to keep up with customer wants and what technology can enable. There is a sense of urgency, and itâ&#x20AC;&#x2122;s mainly being driven by customer behavior and desires.â&#x20AC;?

In addition to standard mobile and online banking, some of Westfieldâ&#x20AC;&#x2122;s recent tech offerings include mobile check deposit and electronic signatures.

Kevin Helmick, president and CEO of Farmers National Bank, sees the movement today as one where com-

munity banks are â&#x20AC;&#x153;closing the gapâ&#x20AC;? in the fintech space.

One of the bankâ&#x20AC;&#x2122;s more innovative offerings, he said, came almost two years ago with picture pay, which lets someone take a picture of their bill and use that to have fields filled in automatically online to facilitate easier bill paying.

Recently, they began offering Apple Pay, something that started coming through the bigger banks a few years ago â&#x20AC;&#x201D; and is seemingly suffering from slow customer adoption, fueling a separate concern of whether banks are truly offering what customers want. KPMGâ&#x20AC;&#x2122;s 2016 Banking Industry Outlook Survey addressed this notion, referencing an apparent disconnect between companiesâ&#x20AC;&#x2122; high perception of their tech offerings and customer use and perception.

Farmers also is working on a service that allows a customer to instantly turn a debit card on and off, improving security. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re competing with banks of all shapes and sizes, and clients want these services now no matter what market theyâ&#x20AC;&#x2122;re in, really,â&#x20AC;? Helmick said. â&#x20AC;&#x153;So you have to be strategic about clients you want and how youâ&#x20AC;&#x2122;re going to transact with them and where youâ&#x20AC;&#x2122;re going to make your money.â&#x20AC;?

Whether those options will be the deciding factor in a customer choosing that bank over another, the fact that tech is at the front of mind for community bankers reflects a paradigm shift in how they view the business. â&#x20AC;&#x153;This is the new normal,â&#x20AC;? Helmick said.

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Region’s accounting space gets a makeover

By JEREMY NOBILE

now, so you can’t just raise billing rates,” he said.

Doing that would elevate profits.

But when other companies are fighting for business, doing that at the wrong time could push clients away.

jnobile@crain.com @JeremyNobile

Following a series of notable mergers, Northeast Ohio’s accounting sector is starting to take on a different look.

A few new brands have come and old ones gone, and that might spell either opportunity or concern for other firms — and in some cases, both — depending on their place in the market as competition for both business and talent remains a top challenge across the industry.

Most industry observers expect to see deals continue as a result.

Some of the drivers today are differing from past M&A cycles, however. And some of those are unique to the Ohio market.

Some factors, though, will always remain constant in a tight market.

“Are we looking opportunistically?

Absolutely,” said Tom Scharf, a partner at midsize firm Walthall CPAs who works on the company’s M&A deals.

It’s been about four years since the firm has made an acquisition. But smaller firms are on their radar today (they’re also fielding plenty of calls from interested buyers).

Some of those smaller firms run by baby boomers are still considering succession plans for their companies — a driver in accounting M&A for some time — which could provide an attractive target to buy.

Yet, Scharf points out, when competition is as tight as it is today, acquisitive growth becomes an increasingly attractive business strategy most would be remiss to not at least consider.

“There is a lot of competition right

Market shift Despite acquisitive interest in firms that might be sold by retiring executives and the overarching appeal of cutting a deal to lift revenues, there’s nonetheless been a real market shift across the industry the last couple years, said Allan Koltin, CEO of Koltin Consulting Group Inc. in Chicago, who advises CPA firms on mergers and acquisitions.

“In the last two to three years, there’s been a landscape change,” Koltin said. “In these mergers, it’s not succession planning, but strategic planning. You’re seeing highly successful firms who don’t have to merge up, but are doing it now to grow faster and provide more service to clients, and probably a better mousetrap to recruit and retain top talent.”

That movement, coupled with an enticing Northeast Ohio market ripe with a wide swath of both large and middle market companies in highgrowth industries, like health care, for example, has enticed some new firms to Ohio.

Illinois-based Sikich LLP announced its acquisition of Akron’s Brockman, Coats, Gedelian & Co. in April. Fellow Akron firm Bruner Cox merged into Minneapolis-based CliftonLarsonAllen LLP in June. And, of course, there’s Chicago’s BDO USA LLP, which completed an acquisition of SS&G Inc. last year, a deal that shook up the market, creating volatility on which some firms aim to capitalize.

And that’s just a look at some of the recent local deals.

It’s no coincidence some of these combinations in the midmarket CPA space are happening today.

“In terms of volatility, I think there’s absolutely some of that in that market,” Sikich CEO Christopher Geier said, “and I think you’re going to see some of that going forward.”

Geier has said Sikich wants to be “dominant” in any market it’s in, which means positioning the company among the top five companies. In this region, that means bumping elbows with large national firms, including every one of the truly dominating Big 4.

Not surprisingly, Geier said Sikich already has a “couple firms” on their radar for other acquisitions in the Akron to Cleveland corridor.

“We’re going to be active in that market because it’s a market we really like,” Geier said.

Ohio’s turn There’s another phenomenon that seems to be bringing those outside firms here, too. In some ways, it’s simply Ohio’s time to see an uptick in interest from firms not present here that are looking for ways to bolster revenues.

Most of the largest and strong midsize accounting firms are already present in the country’s largest markets.

These outside companies eyeing Ohio typically have offices in inherently attractive CPA markets like those in Illinois, New York and Florida already.

So when looking across the country for good targets in new markets, Ohio is creeping up toward the top of many firms’ wish lists. And by establishing in the state’s main regional markets — Columbus, Cleveland and

“In these mergers, it’s not succession planning, but strategic planning. You’re seeing highly successful firms who don’t have to merge up, but are doing it now to grow faster and provide more service to clients, and probably a better mousetrap to recruit and retain top talent.”

— Allan Koltin, CEO of Koltin Consulting Group Inc.

Cincinnati — expanding to the others becomes easier.

“Usually, when you see those firms come in (to Ohio), the strategy is to sort of round out the state,” Koltin said.

And similarly, while Akron/Canton is an attractive market in its own right, Koltin postulates some acquirers also see that as an inlet to the greater Cleveland market.

“Those guys moving south to north, they would rather be in Cleveland than the Akron/Canton market,” Koltin said, referencing other firms who have acquired their ways into the state’s Central and Southwest regions.

Deals at home For established Northeast Ohio firms, though, the interest in M&A comes back to the theme of growing a business in a tight market.

High-performing companies at the upper end of the middle market

spectrum could be targeting other firms for a roll up to simply maintain market share and expand service while gobbling up talented staff.

Considering that, some of the firms Koltin thinks could make some deals in their hometown markets could be Cohen & Co. — which acquired a Michigan CPA firm earlier this year with nearly 80 people in Godfrey, Hammel, Danneels & Co. — and Skoda Minotti.

In Cohen’s case, the Michigan acquisition could look similar to a deal in Ohio. CEO Randy Myeroff asserts the firm doesn’t need a deal to lift revenues. They don’t even really hunger for additional geography. For them, it’s largely a talent play.

In terms of competition, Myeroff said Cohen, the third-largest accounting firm in Northeast Ohio according to Crain’s research, isn’t feeling it quite as much.

Where firms like Sikich and BDO will push upstream for large clients, those focusing on the middle market space won’t necessarily feel more pressure. In fact, Cohen in effect sees one less competitor in this market with BCG dissolving into Sikich.

That’s one area where firms that specialize in that space, or offer other seemingly unique practices — firms like Canton’s 415 Group tout new practices in areas like IT which, as managing partner Frank Monaco said, helps differentiate the company from others and is lifting organic growth above 10% annually — could see additional opportunity in the wake of market volatility.

“We’re going to continue to see this kind of activity,” Koltin said. “In the next year or two, we might even see one or two decent-size deals. It’s just hard to say who it could be.”

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FINANCE

Q&A: Kevin Jacques

Former U.S. Treasury Department economist financial landscape over the last eight years, the banking industry probably has more of a vested interest in the outcome of this election than any other industry.

With a career that includes 14 years with the U.S. Department of the Treasury and a decade as a bank regulator, Kevin Jacques has claimed a seat among renowned national experts on banking, financial and governmental policy. Having spent much of his time advising administrations of former presidents Bill Clinton and George W. Bush on banking and financial regulations, Jacques — who today serves as the Boynton D. Murch Chair in Finance at Baldwin Wallace University — has witnessed and navigated the intersections of politics and policy.

Considering this background, Crain’s sat down with Jacques for his take on how this fall’s presidential election, which features two seemingly unpopular candidates in what’s arguably the most contentious campaign in modern memory, could impact financial policy. — Jeremy Nobile In general, how might bankers look at this election compared to the rest of us?

In one sense, I’m not sure that bankers view this election any differently than the rest of the public. On the Democratic side is a well-known political figure. And on the Republican side we have a businessman, one who has never run for any office to my knowledge, let alone the presidency of the United States. So that creates a lot of uncertainty about what a (Donald) Trump presidency would look like,

should he win. With that said, since the end of the financial crisis there is probably no industry that has garnered more public attention and increased regulation than the banking industry. So issues like regulatory burden and overlap, compliance, and bank capital requirements are high on the list of issues bankers have had to face in the aftermath of the crisis and the passage of the Dodd-Frank Act — certainly one of the most significant pieces of banking legislation since the 1930s. Given the change in the

In what ways might a president influence the banking sector?

The president can affect the banking industry directly and indirectly. First, the president can have a direct influence on the banking industry by the agenda he or she sets and the policies he or she advocates. In this election, Trump’s speeches suggest his banking agenda is built around reducing regulatory burden on banks. With (Hillary) Clinton, her agenda appears to be one of strengthening some of the banking laws put in place in the aftermath of the financial crisis. But the president sets that agenda. Second, the president also influences the banking industry by his choice of key appointments at the Treasury Department and the bank regulatory agencies. This is more complex than it sounds, as the president’s appointees have to not only have sufficient expertise in the areas of banking, but they must be able to function in the political environment that is Washington, D.C. In my experience, and without naming names, some presidential appointees have had a significant impact on the banking industry, while others were ill equipped for the job.

How might those appointments look in a Trump or Clinton presidency?

As for the forthcoming election, if Clinton wins, I expect her appointees to largely come from the world of politics with an eye toward strengthening financial regulation and oversight of the banking system.

If Trump wins, then I expect more appointees coming from the world of

banking and investments with an eye toward policies that reduce regulatory burden and compliance.

But your readers also need to understand that politics will have a lot to say about the degree to which the president can get his or her agenda accomplished as well as the effectiveness of their appointees.

And the fact of the matter is that politics certainly do impact the outcome of financial policy, whether we want it to or not, right? There will always be other interests pulling some strings.

One of the things I think people don’t really understand is how much banking policy is influenced by the political process. I know this because during my tenure at the Treasury, I served on a committee trying to simplify the tax code in the U.S. Needless to say, by the second or third meeting, the committee was told by a member of the Bush economic team that we could not propose a certain tax change because it was politically unacceptable. So we didn’t try to develop the best policy, we tried to develop the best policy for banks that was politically feasible.

Coming back to the candidates, is there one specific banking issue that you believe most divides the two?

The Consumer Financial Protection Bureau provides a perfect example.

In banking policy, no single issue probably differentiates the candidates more than the CFPB, a government agency created by the Dodd-Frank Act in the aftermath of the financial crisis. The idea is to have a government agency whose job it is to protect consumers in financial matters. If you’ve heard the recent case about regulators cracking down on bogus bank accounts at Wells Fargo, you’ve witnessed the power of the CFPB in

protecting consumers. Republicans have long argued that the CFPB is not needed and has contributed to the problem of regulatory burden in the banking industry. So with a Trump presidency and a Republican Congress, we could very well see a weakening of the CFPB. But I don't expect the CFPB to be completely dismantled — that's too hard to do in such a political environment like Washington. On the other hand, Clinton has been a strong advocate of the CFPB and she has publicly stated her opposition to some of the currently existing legislation to change the structure of the agency.

I wouldn't be surprised if she took steps to strengthen the CFPB. Dodd-Frank itself is something most bankers want rolled back, right?

There are so many components to Dodd-Frank. It includes everything from bank living wills to mortgage suitability requirements to higher capital requirements to too-big-to fail. And the list could go on. It was intended primarily for large banks as well as other large nonbank financial institutions. Unfortunately, the costs and burdens of Dodd-Frank have in some cases worked their way down to small and mediumsized banks. That has created regulatory burden and imposed additional costs on banks, even smaller ones.

What is the likelihood of that happening under a Trump presidency?

In a nutshell, the possibility of change in federal banking policy is much greater under a Trump presidency than if Clinton wins. Let’s assume that Republicans continue to control Congress after the 2016 election, as I expect they will. In that case, if Trump wins, he will be the first Republican president since the passage of Dodd-Frank. Trump has

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FOR SALE publicly stated, in a number of his speeches, that ‘Dodd-Frank has made it impossible for bankers to function’ and that he would dismantle it. So if Trump wins the presidency, combined with a Republican Congress, we could see a dramatic rollback of the Dodd-Frank provisions that apply to the banking sector.

And how might Dodd-Frank and bank regulation look under a Clinton administration?

I don’t see much of a significant change in banking policy if she wins.

Two reasons here. First, she is a moderate who has publicly stated in some of her speeches that she supports Dodd-Frank. In fact, there are parts of banking policy she has stated she would like to further strengthen. Examples would be the regulation of the shadow banking system and consumer protection.

Second, if Republicans maintain control of Congress, a Democratic President would be hard pressed to get any significant changes through the Congress. So if Clinton wins, I see a stalemate on banking policy. What that means for banks is no rollback of Dodd-Frank, but also it is unlikely that Clinton would be able to pass additional banking reform policy of any great significance. But all of this hinges on the election. Like I said, politics will have a lot to say about banking policy.

There is this sentiment, though, that Dodd-Frank has created the most burden for small to midsize banks compared to the largest companies the reform was intended to target. Could there be relief in store for that smaller segment?

I do think both parties agree that Dodd-Frank has imposed significant costs on these banks. Having worked with the Federal Deposit Insurance Corp. on bank failure resolution policy during my Treasury days, these banks are generally fairly easy to resolve should they fail, and they tend to do so at minimal cost to the deposit insurance fund. So the

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one area I think we will most likely see movement, regardless of who wins the election, is regulatory relief for these banks. After that, these two parties are really divided about Dodd-Frank, its costs, and its impact on the safety and soundness of the banking system.

Coming back to the impact of politics, do you foresee politics having a greater impact on one administration over another in terms of creating policy?

Politics will have a potentially huge impact on banking policy. A Republican President with a Republican-controlled Congress would have considerable ability to rollback significant parts of Dodd-Frank. Congress has already tried to do that earlier this year.

But in an election year with a sitting Democratic president, Dodd-Frank is not going to be weakened. So whether it be rolling back Dodd-Frank or reducing regulation on banks, the best chance is a Trump presidency. In fact, I believe this election represents the best chance the banking industry has to get relief from Dodd-Frank for the next eight to 10 years. With regard to Clinton, given the state of politics on Capitol Hill, it is highly unlikely she will be able to have a significant impact on banking policy, although I expect her to try to strengthen Dodd-Frank as it relates to the shadow banking industry and possibly consumer protection.

In all this talk of politics kind of feels like a reminder to follow the Congressional races as well.

So much attention is currently being paid to the presidential race, and understandably so. But, yes, pay attention to the races in the House and Senate. Whether the House of Representatives and the Senate continue to be controlled

by Republicans will have a lot to say about whether either presidential candidate is able to alter banking policy, should they be elected.

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FINANCE

Study: Defining high-growth Adviser: Kate Hubben Finding the Rx for Rx companies is vital to success

By DOUGLAS J. GUTH clbfreelancer@crain.com

It may sound like an old proverb, but to understand how high-growth firms contribute to economic prosperity, one must first understand how they are defined. According to a recent study from Cleveland State University Center’s for Economic Development, definitional agreement is vital when examining rapidly growing businesses in Northeast Ohio and across the state.

As the current disparity in identifying so-called HGFs can impede their success, an across-the-board description is needed, preferably one that aligns with efforts in the policy arena, noted the study compiled by Cleveland State researchers with support from JumpStart Inc., the Ewing Marion Kauffman Foundation and Burton D. Morgan Foundation.

In addition, public strategizing should target a variety of industries to foster HGF development. Such clarity will only boost a subset of companies that contribute significantly to a robust economy, study organizers said.

“We know these firms are critical to long-term job and economic growth, so it’s important to have a clear way for both policy makers and practitioners to identify and support them,” said Ray Leach, the CEO at JumpStart, a nonprofit that works with entrepreneurs in Northeast Ohio.

As currently identified, HGFs generally increase annual revenues by more than the industry average over

a sustained period. A one-time surge won’t cut it; rather, growth has to be demonstrated over a number of years. Due to factors like company size, age and industry, some observers add various employment or sales thresholds to their HGF definitions.

Smaller businesses can be HGFs, too. In the Cleveland State study, the authors classified a firm with 10 or fewer employees as high-growth if it grew by eight or more employees over a three-year period. A firm with more than 10 workers, meanwhile, had to grow at least 72.8% over the same period to be considered an HGF. Variables in criteria muddy the waters for Ohio economic developers looking to support the livelihood of these businesses, said Yas Motoyama, a program officer on the Cleveland State report and policy director at the Kauffman Foundation.

Drilling into what comprises an HGF also requires a knowledge of how these companies are impacted by ongoing cycles of recession and recovery. Belaying arguments by experts that these firms are “recession proof,” the report stated that the recent Great Recession resulted in a distinct dip in HGF expansion. However, economic down periods do not necessarily stanch entrepreneurs from launching new companies.

“The business cycle affects HGF classification, but their creation is not determined by it,” Motoyama said.

The Burton D. Morgan Foundation works with JumpStart and other partners on scale-ups, or companies specific to high-technology sectors seek-

ing to increase their market access, revenues and employee numbers.

Northeast Ohio’s emerging clusters in additive manufacturing and liquid crystals need continuous backing from an ecosystem of early-stage and state funding sources.

“Having dollars that support development in the scale-up space is very important,” said Deborah Hoover, the foundation’s president and CEO. “Providing consistency in that money will build up that capacity.”

Per the report, HGFs exist in a lot of areas, not just technology-based growth industries. For example, a large presence in the professional and business services means enhancing policies that buffer any recessionary effects stifling these firms.

Motoyama of Kauffman Foundation points to education investment creating a constant local talent pipeline.

“You want a highly educated, motivated workforce, which is significant for HGFs,” he said. “Companies will recruit from nearby schools, because they want someone who understands the local culture and market and will stay at the company for a while. If you hire a transplant from New York or California, chances are they will leave the business after a year or two.”

Ultimately, Ohio’s dealmakers must find common ground on how HGFs are defined, with promotion and enhancement of these economic drivers being the ultimate goal.

“If we’re going to work seriously on a statewide basis, we better be on the same page,” Hoover said. “The report sets the stage for this conversation.”

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One of the biggest challenges for companies when providing health insurance is to stem the rising cost of pharmacy. Pharmacy trend is growing faster than medical trend and specialty pharmacy costs are projected to double in the next four years. Experts say pharmacy costs will soon even exceed inpatient hospitalization costs. This is the latest problem for businesses who were finally getting a handle on the Patient Protection and Affordable Care Act. The major culprit of the growing pharmacy trend is specialty pharmaceuticals. A specialty drug is typically a biologic and is used for treating a complicated medical condition. These drugs are expensive and require special handling and ongoing clinical monitoring. Names like Enbrel and Humira are on the lower end of the cost spectrum, while Soliris and Provenge can cost up to $1 million per year. Pharmacy claims should range from $59 to $120 per member per month or around 20% of overall medical claim costs.

However, companies are starting to see their pharmacy spend creep up to 25% to 28% with little relief in sight.

However, there are other factors that could be contributing. Companies may be reluctant to make changes to their drug plan because it might hurt morale and retention. Retirees, if covered, could also be impacting the drug spend.

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In an ideal world, a company would have 90% generic utilization or higher.

Realistically, most fall in the range of 79% to 87%. The general rule of thumb says that for every point a group increases their generic utilization, claim costs can go down 2% to 3%. Effective ways to improve your generic utilization are to incent your employees with lower or $0 co-pays, offer attractive high-deductible health plans with health savings accounts and/or change your drug formulary with the pharmacy benefit manager (PBM).

Another solution to consider when trying to manage pharmacy inflation is strong “utilization management,” which ensures the right patient is using the right drug in the right dosage

Kate Hubben is a client advocate at Willis Towers Watson in Cleveland.

amount. Outside vendors can be engaged to perform this review but companies can also actively review the de-identified utilization data and seek out trends. Companies, as a matter of routine, should rely on their broker or consultant to facilitate this discussion. Claims information can tell the story about a population.

Some of the questions that business owners must ask are: Do you have four tiers of drug coverage? Are doctors prescribing medication that must be made into a lotion or composite which can unknowingly spike? Do your employees have access to a specialty pharmacy? And importantly, are employees required to use step therapy?

Employers should also use a PBM that adheres to a contract, offers quality programs and educates members about them. Also, consider whether the PBM has an established protocol to update the plan sponsor about high-cost claimants. Is your PBM open to a dialogue with the medical carrier to make sure there is collaboration on best practices? If you are not having this conversation with your consultant, you should be.

For business owners with fewer than 100 employees that don’t get actual claims data, you can ask for your loss ratio for your pharmacy claims. If it is high, you can introduce a consumer-driven health care plan, which brings an awareness to the member about what prescription drugs actually cost. You can also increase your generic utilization by eliminating copays. And, you can ask your carrier what measures they have introduced to manage their proprietary pharmacy spend.

And as always, rely on your employee benefits consultant to be proactive, informed and tireless in the pursuit of cost containment for your company.

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CRAIN’S CLEVELAND BUSINESS

Poll: Advisers warming up to DOL fiduciary rule

By GRETE SUAREZ Investment News

Financial advisers’ views on the Department of Labor’s fiduciary rule have taken a surprising turn, as more are seeing the rule as having a positive impact on their business, according to a new study from Fidelity Investments.

A recent poll of financial advisers at wirehouses, broker-dealers and RIAs revealed that 29% see opportunity in the DOL investment advice rule — up 17% from January — while close to a quarter of respondents believe the rule will have a positive impact on their ability to acquire and retain clients.

Tom Corra, chief operating officer of Fidelity Investments’ clearing and custody solutions unit, said the shift in sentiment was because of more certainty around the rule.

“When we first did the poll in January, the DOL rule was in draft form,” he said. “Now there is more certainty around the rule. There is value in having certainty, knowing what the adviser has to deal with in regards to the regulation.”

The rule has prompted shifts in strategies where new opportunities emerge. One in four advisers see the DOL rule as a catalyst to grow and maintain a profitable book of business. One in five advisers said their employers are engaging in acquisitions.

However, while more advisers are warming to the DOL rule, most advisers expect the rule to have an over-

“There is value in having certainty, knowing what the adviser has to deal with in regards to the regulation.”

— Tom Corra, COO, Fidelity Investments’ clearing and custody solutions unit

all negative impact on the cost of doing business as well as their overall compensation.

They anticipate spending more time on compliance and paperwork for fewer rewards.

One in 10 advisers are planning to leave or retire from the occupation earlier than they had planned, with 18% saying they are reconsidering their career as advisers.

It’s not only advisers who will be impacted by the rule. Clients also will bear the consequences as well. More than half of advisers believe smaller clients are not profitable and may cut them.

Corra said his clients are considering lower-cost automated services to cater to these clients, but many are not prepared. Only one in 10 advisers have an automated investment offering in place, the poll showed, and 46% of the advisers haven’t taken any steps to prepare for the rule.

“All advisers need to have a look at their business practices, as to their

position as being a fiduciary,” Corra said. “Each adviser needs to understand how that will impact their individual practice. Advisers who have taken time to plan will be in a better position.”

Other findings In a race to become compliant with the DOL rule before its April 2017 deadline, half of advisers are expecting to manage two-thirds of their retirement assets using level-fee compensation — where an adviser only receives an advisory fee for their services.

Advisers also expect to manage almost a third of their retirement assets using exemptions, including the best-interest contract exemption, known as BICE. The exemption can allow brokers to sell commission-based products without invoking penalties.

However, the DOL rule will change the products that will be offered. Two of five advisers will recommend fewer variable annuities, and close to half will recommend more managed accounts.

“Clients are reviewing their product offering to ensure they’re focusing on products that are not only suitable for client portfolios, but that meet their best interest standard,” Corra said. “It’ll come down to the individual advisers and their business model, to survey what needs to change.”

Suarez is a reporter for Investment News, a sister publication of Crain’s Cleveland Business.

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Third Federal makes $500K commitment to housing agency

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

The Third Federal Foundation announced a commitment of up to $500,000 to the nonprofit Empowering and Strengthening Ohio’s People agency, a HUD-approved housing and financial counseling group, in an effort to stimulate additional giving to the organization.

The Foundation, the charitable arm of Cleveland’s Third Federal Savings & Loan, has donated $100,000 to the agency so far and will match up to $400,000 in additional grants from other donors over the next five years.

It’s hoped the grant will encourage additional giving by other donors to the group, which was founded in 1993 by Inez Tillman Killingsworth.

Among various efforts, some of the agency’s goals are to address issues of foreclosure and predatory lending under a vision to make home ownership affordable.

“Given the shared vision of both organizations, Third Federal has been proud to partner with Inez Killingsworth and ESOP over the years,” said Marc Stefanski, Third Federal chairman and CEO, in a news release. “This grant by our foundation further demonstrates our commitment to ESOP and to the communities we share. Our hope is that this gift is also a challenge to other companies and organizations to provide financial support to this worthy orga-

Marc Stefanski

nization.”

The Third Federal Foundation has been a longtime supporter of both ESOP and other various charitable efforts centered on Cleveland neighborhoods. Last September, the Foundation announced a $5 million donation in partnership with the Marc A. and Rhonda L. Stefanski Foundation to finance a community health education center designed to address health disparities in Cleveland neighborhoods, marking the largest ever donation from the charity. Rhonda is Marc’s late wife, who died in November 2014 of pancreatic cancer.

Third Federal Savings & Loan is the largest savings association by deposits in Northeast Ohio, according to Crain's 2016 Book of Lists, with more than $6 billion in deposits in the market.

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CRAIN’S CLEVELAND BUSINESS

Business of Life

Because of the current trade embargo, Cuba has no new American cars. Instead, the streets of Havana are filled with vintage American rides. (Karry York for Crain’s)

Navigating complicated matters To Cuba Now aims to help U.S. businesses build relationships, which often starts with travel

By JAY MILLER jmiller@crain.com @millerjh

It was a travel agent’s nightmare. A hotel, at just about the last minute, canceled a reservation for a group of 15 people. Fortunately, the agent scrambled and saved the day.

That would be nothing particularly exciting or interesting, except that the booking was for a group of Kent State University urban design and architecture students at a five-star hotel in Havana in March. The Kent State students were traveling to Cuba to research and reimagine Havana’s aging waterfront.

The hotel reservation was canceled because President Barack Obama had decided to visit the Caribbean island nation at the same time the students were planning to be there, and the Cuban government was clearing out the top hotels for visiting dignitaries.

And the travel agent wasn’t exactly a travel agent. It was Nicholas York, who calls himself “a recovering lawyer.” York had been a partner at Tucker Ellis LLP, a Cleveland law firm. But now he is trying to build a business consultancy, To Cuba Now, specializing in helping U.S. businesses build relationships in Cuba.

So York, who by the time of Obama’s visit was an experienced Cuba hand, managed to save the day, using his Cuban travel contacts to

Street musicians play in Old Havana.

Nicholas York (left) is shown with one of his Cuban contacts, Inti Alvarez, in front of Alvarez’s art gallery.

find the 15-person Kent State group lodgings.

York and Jorge Delgado, the former director of international relations at the Cleveland Foundation, created To Cuba Now hoping to play a role in rebuilding business ties between the United States and Cuba. But York found that before he could advise U.S. businesses on

how to do business with Cuba, he had to become something of a travel agent.

“I never wanted to be in the position of trying to sell Cuba to anybody.

I wanted to provide them access and understanding and knowledge,” he said. “And we needed to take people there so they could see it and understand it themselves. Then we could help them navigate in the future.”

Booking travel quickly became a full-fledged business on its own, offering what York describes as a business and cultural immersion experience.

The role of travel agent/guide/con-

sultant has taken York to Cuba 20 times since January 2015, when travel restrictions between the two countries were loosened. Before the December 2014 joint announcement between Obama and Cuban President Raoul Castro that they intended to normalize relations between the two countries, direct travel to Cuba from the United States was banned.

York’s consultancy won’t truly reach fruition until the trade embargo that has existed between the two countries since 1960, shortly after the communist takeover of the island in 1959, is lifted. But the two countries have begun to look for

ways to resume trade, and York and Delgado believe they can find a niche for their consultancy, even if it includes acting as a travel agent.

To Cuba Now has taken business executives, entrepreneurs and groups from the Youngstown/Warren Regional Chamber, the American Institute of Architects and the Society for Human Resource Management.

“They found us another place to stay, which wasn’t easy,” said Terry Schwarz, the director of Kent State’s Cleveland Urban Design Collaborative. “We went from some fancy hotel to one that was significantly less fancy, but that was OK.”

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BUSINESS OF LIFE

Source Lunch Buffy Filippell was the first female agent at IMG, and she is friends with such sports industry heavyweights as former NBA commissioner David Stern. But if you really want to get Filippell to beam, ask her about TeamWork Online, the Shaker Heights company she founded in 1987, reaching a huge milestone last June. The sports recruiting giant has now served as the connection for more than 100,000 hires. TeamWork Online has more than 1,100 clients in the sports industry, and it has a database of 4 million job candidates. “I’m just sort of speechless about how that’s all happened,” Filippell said. It turns out that part isn’t entirely true, since Filippell can go into great detail about how she turned what started as an “applicant tracking system” into the go-to place for sports employment. Of the 100,000-plus hires, a combined 34% (about 17% each) have been in the NBA and Major League Baseball. The NFL (12%) and NHL (10%) have accounted for another 22%. More impressive, though, is this: TeamWork says 42.3% of its hires in an industry too often dominated by males have been females, who account for almost half of the company’s database of candidates. — Kevin Kleps

The 100,000 hires: What kind of an achievement is that for you?

To be able to have employers select 100,000 people to get hired is a pretty amazing accomplishment. I guess I never thought that we would get there. I’m a phys ed major. Gosh, I was hoping I could play collegiate tennis. You always have the dream to be pro, and of course that’s never going to happen if you’re a walk-on.

Why has your system — your clients include the NBA, NFL, NHL, Major League Soccer, NASCAR and the PGA Tour — worked so well?

I think we’ve created what is one giant job fair where all these employers are sitting at these desks.

They’re putting on the front of the arena all these jobs, people are coming in for different jobs. And yet I’m going to put my card in the hat for this one, but I see there’s something better over here. How we’ve gotten everybody to agree to play in this job fair — people do it all the time, I just made it digital. I’m not a programmer, I couldn’t get into Indiana University’s business school, and now I run two businesses, and helped all these other businesses get the talent that they need.

You’re celebrating the 100,000 milestone by writing about 100 of the hires on LinkedIn. Why? These 100,000 stories are a treat for me. I get to talk about nifty things about nifty people. What a gift, right? You write stories about people all the time. You’re giving them a gift.

You’re making them feel like they’ve accomplished something, and it’s written by somebody who thought

well enough to write about it. I really, really enjoy that.

What are some of the qualities of a good sports business candidate?

That’s the first thing: Do you really want to be in our industry, and will you give it your all? Some people say they will, but many times they’re better at buying a ticket and going to games. It’s kind of like ice cream. If you really like ice cream, you may not want to work at Ben & Jerry’s, but you might want to go and get your favorite ice cream.

From an organizational standpoint, is there a key to hiring a quality executive?

I think that varies per organization, but I would say, “Is there a key to how I hire?” I did a very odd thing when I was starting out recruiting. I would listen to a client tell me what they were looking for and I would try to be the candidate. It was almost like acting the role, and if I could act the role and listen to somebody else tell me how they would play the role and they played it equal, that was good. And if they played it better, wow! It wasn’t just saying, “Do you have this?” It wasn’t being a third party and asking questions. It was almost embodying the person. I’m just going to be this person, because if I can be you, then I can recognize you in other people.

What are some things that you really enjoy about your job?

You’re in somebody’s life for a moment in time. I love that. It’s like I’m sitting through their hardships, I’m listening to their challenges, I’m

Buffy Filippell

sad for deaths in their family. I’m there for a moment in time, then I’m gone in a sense. But each one of these people becomes a piece of me, a piece of my life and a piece of who I am. If you would have told me when I was applying for jobs, “You’re going to be in the lives of 100,000 people and get close to the commissioners of major-league sports and know their families and know their staff and have something to do with that,” I would’ve been shocked.

What’s your favorite hiring story?

Is there one that really stands out?

There’s this story about Fred Mangione (now the chief operating officer of the Brooklyn Nets), I recruited him to be the head of ticket sales for the Women’s World Cup in 1999. He was 26 years old, and he was supposed to sell 78,000 tickets to watch a first round of the Women’s World Cup. He was a short-season, minor-league ticket sales guy — short season (minor league baseball), maybe 2,000 people watch that. … He had no idea what soccer was, and he said, “I’ll do it.” He brought in a ticket sales staff, and you can’t call enough people to get to 78,000. He came up with the idea of going to the summer camps and saying, “Would you ask your campers to pay $50 and come to the Women’s World Cup?” And he had tons of summer camps. He got the summer camp people to add it to their operations. On June 19, 1999, 78,972 people (the largest crowd ever at the old Giants Stadium) came (to see the U.S. women’s opening match). It was a full house.

SPORTS

Five Things: FIRST TEAM HIRE Tim Leiweke — a former AEG chief executive who has had prominent positions with the Toronto Maple Leafs, U.S. Skiing and the Denver Nuggets — was recruited by Filippell to be the first hire of the expansion Minnesota Timberwolves in 1988.

EFFICIENCY IN ACTION TeamWork Consulting and TeamWork Online get a lot done with just seven full-time staffers, plus what Filippell calls “a lot of temporary people in programming, accounting services and consultants.”

ON THE MOVE Filippell says she runs or swims every day.

FAVORITE EVENT The former collegiate tennis player loves attending the U.S. Open in New York.

NUMBERS GAME When TeamWork Online was relatively new, the XFL — Vince McMahon’s short-lived football league — enlisted Filippell’s help to fill 120 positions. The company’s digital database wound up with 56,000 candidates applying for those jobs.

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The meal

A turkey club with French fries and water for both, and one enjoyed the clam chowder.

The vibe

Regrettably, we didn’t try the coffee at A.J. Rocco’s, which operates the Cleveland Coffee Company.

But everything else — the casual crowd, the sandwich selection and, if you’re so inclined, the beer options — is ideal for getting a quick, and quality, bite.

The bill

$23.22, plus tip

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CRAIN’S CLEVELAND BUSINESS

A look at the University of Akron’s leadership changes

AKRON

Since Scott L. Scarborough stepped down as president of the University of Akron, six of the university’s leaders who were hired by him in 2014 or 2015 have announced plans to leave. Here’s a quick look at who, with the university’s plans for the vacated positions from Interim President Matthew J. Wilson.

CONTINUED FROM PAGE 1 Analytics and Information Technology, effective Dec. 9. In September, the university’s dean of the College of Health Professions, David Gordon, announced his intentions to leave that role, effective Dec. 31. And both Jeff Hoffman and Ian Schwarber, respectively the founding director and the resource director of the Experiential Learning Center for Entrepreneurship and Civic Engagement, announced plans to leave.

Overall, Wilson said the university was handling the leadership churn well.

The students are engaged and the faculty positive, he said, and he hasn’t seen anxiety over the personnel turnover.

As long as faculty and staff put their attention on the student experience, “everything will fall into place,” Wilson said.

Name

Title

Separation announced

Reason for leaving

What Akron will do with the position

Lawrence Burns

Vice President of Advancement

July 6, 2016

Burns said it made sense for him to leave when Scarborough did.

The university has taken Burns’ duties and distributed them among the rest of the staff.

Todd Rickel

Dean of the College of Applied Science and Technology

July 7, 2016

No reason given

There is an interim dean in place and the university will search for a permanent one in the future.

Mario R. Garzia

Executive Director of the Center for Data Science, Analytics and Information Technology

Aug. 11, 2016

Garzia said the university was not following through on its commitment to develop the center.

The university will be relying on faculty to fill Garzia’s role.

David Gordon

Dean of the College of Health Professions

Sept. 14, 2016

A combination of factors, including allegations that Gordon had violated his employment agreement by continuing to do clinical work at the University of Michigan

There will be a new dean search.

Jeff Hoffman

Founding Director of the Sept. 16, 2016 Experiential Learning Center for Entrepreneurship and Civic Engagement

Hoffman gave no reasons in his resignation letter, but Wilson thought there was frustration due to fewer available resources for the center.

The university has named new co-directors of the center.

Ian Schwarber

Resource Director of the Sept. 21, 2016 Experiential Learning Center for Entrepreneurship and Civic Engagement

Schwarber’s resignation letter referred to a “shift in strategy and priority of the center.”

The university has named new co-directors of the center.

What happened The reasons they all had for leaving are varied. Burns said the timing was right for him to leave when Scarborough did, though he enjoyed his time with the university and was disappointed his tenure was so short. He’s staying in the Akron area for now and refocusing on his consulting business, which is currently being rebranded. He’s still on good terms with the university, he said, and wishes Wilson well.

Sources: University of Akron; Crain’s reporting

The university only had a termination letter for Rickel, not a resignation letter. In responding to a message from Crain’s, he said he wished the university well but did not indicate why he decided to leave.

The resignations of Garzia, Hoff-

man and Schwarber appear to have some common themes — mostly concerning funding for the academic centers they led, which launched with much fanfare during Scarborough’s brief tenure. Wilson said he consulted with Garzia and Hoffman

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about available resources for their centers and noted that both seemed frustrated.

Wilson said there are general discussions happening across campus about how to operate efficiently with a declining tuition base, but he didn’t see any other resignations on the “horizon.” That applied to other leaders who had been hired by Scarborough — namely Honors College Dean LaKeesha Ransom, Athletic Director Larry Williams and CIO Godfrey Ovwigho — as well as College of Polymer Science and Polymer Engineering Dean Eric Amis, who Wilson said, like himself, began the hiring process shortly before Scarborough arrived at the university.

Hoffman did not respond to a request for comment, and Schwarber declined. Hoffman’s resignation letter included no indication of why he chose to leave. But Schwarber’s cited a “shift in strategy and priority of the center,” noting he believed in the center’s purpose and wished it well going forward.

Garzia said the university’s moves could “slow down the progress toward the future” and the Center for Data Science would be a lost opportunity. He said he had a “tremendous” time working with students and local companies while at the university, but it was unable to follow through on its commitments to develop the center. He plans to stay in the area to help companies develop in the data science space.

Perhaps the most complicated of the six is the university’s split with Gordon.

In documents provided by the university, the school alleged that Gordon had been in violation of his employment agreement by continuing to work at the University of Michigan beyond the 2014-2015 academic year while employed as a dean at the University of Akron (he was allowed to do that work during the first year) and by not using vacation days for that work or taking those days as leave without pay.

Gordon said he had filled out the appropriate conflict of interest forms, but that nothing was brought up as a concern until Scarborough stepped down.

He said he takes the blame for his interpretation of the offer letter but that doing clinical work, like he was at the University of Michigan, is a widespread and encouraged practice in the health education industry.

He said it made sense to continue his work as a cardiovascular pathologist in Michigan, where he was already licensed and respected. He also said there was a lack of comparable opportunities in Akron.

It was that dispute — along with what he said were allegations that he was performing poorly — and what he called a lack of investment in the College of Health Professions, despite Scarborough’s promises that he would look for resources, that Gordon said led to his resignation.

Still, he said he has a “lot of hope” for the university, though he doesn’t think senior leadership is doing enough to support it. There need to be investments in programs that can offer a return, he said, instead of constant cutbacks.

“There are a lot of excellent people here, particularly faculty and staff,” Gordon said.

What’s next As varied as the reasons leaders have had for leaving the university in recent months are the actions it’s taking to replace them.

Wilson said the university has an interim dean in place in the College of Applied Science and Technology and will be looking for a permanent dean in the near future.

The university will also conduct a new dean search for the College of Health Professions.

But the role of vice president of advancement vacated by Burns is not being externally filled, Wilson said.

That was an “umbrella” position that oversaw a variety of departments, and Burns’ responsibilities are now being handled by the “capable folks” in those departments, Wilson said.

As for the Experiential Learning Center and the Center for Data Science, both initiatives will continue in different capacities than before.

The university is not filling Garzia’s role with the Center for Data Science and will instead rely on faculty members to continue that work, Wilson said.

And a pair of internal employees, Carolyn Behrman and Annal Vyas, respectively the former faculty director of collaboration for the center and a visiting assistant professor of clinical law, took over the roles of co-director at the Experiential Learning Center at the end of September, though they’ll be running the center with fewer resources, Wilson said.

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ADS CONTINUED FROM PAGE 1 in advance, risked having their advertising bumped by a presidential or Senate candidate who was running behind and needed additional advertising time at the last minute. That meant that mounting a big sale that required getting the word out on television could flop if a presidential candidate claimed the ad time.

But the small television advertising commitment by the campaign committee and the other groups that support Republican presidential candidate Donald Trump on the airwaves has tempered the spending of the forces behind Democratic contender Hillary Clinton as well. At the same time, the pullback on advertising in what is turning out to be a less-competitive-than-expected Senate race between Sen. Rob Portman and former Ohio Gov. Ted Strickland is shrinking the expected television advertising traffic jam even further.

“We are getting calls, offers of inventory (commercial time) from stations,” said Jim Ganzer, director of media strategy at Adcom Group, a Cleveland marketing and communications firm. “They are lighter than they expected to be.”

Tracking who is spending what for political candidates is tricky, since the campaign committees and even the television stations disclose as little about their advertising businesses as possible and the campaigns may make or revise ad buys right up to Election Day. In addition, the services that track political campaign ad buying outlays use different models.

But in August, Bloomberg Politics reported that spending on political advertising during the U.S. presidential election had dropped 60% from 2012. A year ago, Borrell Associates Inc., a media industry analyst based in Williamsburg, Va., had predicted that political ad spending, most of it on television, would hit $11.4 billion, up 20% from the 2012 presidential election cycle. “(The spending) is significantly less than other presidential years by a large margin for a couple reasons,” said Jeff Rusnak, president and CEO of R Strategy Group, a Cleveland issue advocacy and strategic communications firm.

“You have Trump not really buying TV time and all of the Senate committees (for Republican incumbent Rob Portman and Democratic challenger Ted Stickland) have pulled out,” he said. “In the Cleveland market in particular, and around the state, the amount spent is less.”

Rusnak said based on reports from his media buying service, the Clinton campaign in 2016 is paying a price for ads that a candidate might pay in an off-year election, not an intensely busy presidential campaign year.

That might be good news for local retailers and other television advertisers, since it will be easier for them to get on the air in the next month and at lower prices, according to people who track and buy TV time. But there are caveats, since the political campaigns are known to make late buys and, because of federal regulations, can bump commercial advertisers.

Still, it is looking like a close presidential election, and the campaigns have money in the bank. So how the political campaigns play out their advertising strategies makes predic-

tions difficult.

In 2012, according to TV ad spending compiled by the Washington Post and Kantor Media/CMAG, an ad tracking service, committees supporting Democrat Barack Obama spent $59.4 million on Ohio television stations between July 16, 2012, and Election Day, Nov. 6, while his opponent, Mitt Romney and his supporters spent $68.9 million, for a total of $128.3 million.

Advertising Age, a sister publication to Crain’s Cleveland Business, reported that the Clinton campaign and its supporting committees had booked $19 million in broadcast advertising in Ohio between July 14 and Nov. 7. The Trump campaign had booked only $212,175.

Those numbers may balloon considerably — the Obama and Romney campaigns spent $20.5 million and $25.4 million, respectively, in Ohio in the last three weeks of the campaign, according to the Washington Post’s data.

More locally, the data compiled for R Strategy Group shows that, as of early September, Hillary for America and Priorities USA Action, the campaign committee and her political action committee, had committed to spending a combined $6.2 million on Cleve-

land television stations between Sept.13 and Election Day, Nov. 8.

While the R Strategy data showed no committed spending by the Donald Trump campaign or a Trump Super PAC, filings with the four local broadcast stations show subsequent orders to purchase 30-second spots at the stations totaling $416,000 between Sept. 2 and Sept. 16. The cost of ad time ranges from $200 for an early morning spot to $2,400 on WKYC’s 11 p.m. news.

That suggests some tightening of the ad inventory at the stations, but not nearly the sellout stations ad buyers had anticipated early in the year.

So the television stations, unexpectedly, have advertising time to sell.

Ganzer believes one reason for the unexpected availability of ad time is that the Trump campaign is finding it effective to use video — online on YouTube, Facebook and other websites — to reach potential advertisers.

“Video is video,” he said. “To the average consumer, they don’t see the difference between TV versus what they are seeing on stream.”

But Ganzer is surprised that an old-school ad crowd like political campaign consultants are going so heavily into the online world.

“Maybe it has something to say about Trump particularly,” he said.

“Or maybe it’s that people are finding more targeted ways to reach an audience (for the future). In four years, millennials will be four years older and there will be a new crop of votes.

“Let’s wait and see how it plays out.”

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

The List NAME THIS COMPANY YEAR TITLE

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O C T O B E R 3 - 9 , 2 016

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PA G E 2 7

HIGHEST PAID CFOS-PUBLIC COS.

Ranked by 2015 Compensation

TOTAL COMPENSATION 2015 2014

% CHANGE

SALARY

BONUS

STOCK AWARDS

OPTION AWARDS

NONEQUITY INCENTIVE PLAN

CHANGE TO PENSION VALUE

ALL OTHER COMPENSATION

1

Terrance M. Paradie/TransDigm Group Inc. CFO

$9,632,566 (1) NA

NA

$225,846

$8,720

$1,042,507

$8,179,213

$176,280

NA

2

James F. Pearson/FirstEnergy Corp.

CFO, executive vice president

$5,569,912 $4,269,966

30.4

$636,154

NA

$3,060,719

NA

$793,174

$1,070,707

$9,158

3

Richard H. Fearon/Eaton Corp. plc vice chairman, chief financial and planning officer

$5,334,633 $5,984,370

(10.9)

$753,912

$0

$1,657,124

$548,193

$1,549,645

$751,795

$37,714

4

John P. Sauerland/Progressive Group of Insurance Cos. CFO, vice president

$5,122,462 (2) $2,772,936

84.7

$516,538

$0

$3,560,097

NA

$1,033,077

NA

$12,750

5

Jon P. Marten/Parker Hannifin Corp.

CFO, executive vice president, finance and administration

$4,507,489 $5,369,020

(16.0)

$657,500

NA

$880,413

$839,395

$762,497

$1,240,790

$126,894

6

Laura K. Thompson/Goodyear Tire & Rubber Co. executive vice president, CFO

$4,137,463 $3,114,681

32.8

$551,667

$0

$314,120

$449,992

$2,114,933

$662,960

$43,791

7

Robert G. O'Brien/Forest City Realty Trust Inc. CFO, executive vice president

$4,060,330 $2,871,494

41.4

$563,327

$0

$2,574,638

$0

$857,139

$9,725

$55,501

8

Mark R. Belgya/The J.M. Smucker Co. vice chair, CFO

$3,964,776 $2,674,683

48.2

$475,000

$9,500

$858,500

$1,674,750

$178,200

$744,022

$24,804

9

Sean P. Hennessy/Sherwin-Williams Co. CFO, senior vice president of finance

$3,564,600 $3,105,462

14.8

$661,490

$0

$1,286,505

$677,417

$688,000

$0

$251,188

10

Donald R. Kimble/KeyCorp CFO, executive council member

$2,735,681 $2,430,179

12.6

$623,077

$0

$1,169,987

$130,000

$760,000

$0

$52,617

11

P. Kelly Tompkins/Cliffs Natural Resources Inc. CFO, executive vice president

$2,533,436 (2) $2,251,997

12.5

$537,000

$0

$1,243,092

$282,128

$371,174

$72,987

$27,055

12

Brian C. Witherow/Cedar Fair LP CFO, executive vice president

$2,513,676 $1,402,130

79.3

$431,841

$0

$1,437,382

$0

$624,000

$0

$20,453

13

Robert K. Gudbranson/Invacare Corp.

CFO, senior vice president, treasurer

$2,217,961 $1,432,007

54.9

$543,750

$0

$1,206,161

$0

$454,688

$9

$13,353

14

Vincent K. Petrella/Lincoln Electric Holdings Inc. CFO, executive vice president, treasurer

$2,124,292 $1,960,240

8.4

$473,021

NA

$280,073

$270,106

$777,746

$288,753

$34,593

15

Gregory A. Thaxton/Nordson Corp.

CFO, senior vice president

$2,083,512 $2,249,043

(7.4)

$420,000

$0

$434,012

$354,220

$326,340

$514,429

$34,511

16

Russell L. Gordon/RPM International Inc. CFO, vice president

$2,004,069 $1,885,991

6.3

$450,000

$0

$691,053

$321,900

$450,000

$44,937

$46,179

17

Philip D. Fracassa/The Timken Co. CFO, executive vice president

$1,958,451 $2,593,030

(24.5)

$490,000

NA

$661,327

$286,207

$152,810

$299,000

$69,107

18

David S. Huffman/Third Federal Savings & Loan CFO

$1,737,741 $1,094,726

58.7

$419,232

$0

$351,129

$429,974

$457,773

$22,237

$57,396

19

Andrew J. Rebholz/TravelCenters of America LLC CFO, executive vice president, treasurer

$1,721,750 $1,845,000

(6.7)

$300,000

$957,250

$463,000

NA

NA

NA

$1,500

20

Jeffrey L. Rutherford/Ferro Corp.

CFO, vice president

$1,675,128 $1,836,411

(8.8)

$484,100

$0

$572,112

$243,958

$289,800

$0

$85,158

21

Mark O. Eisele/Applied Industrial Technologies Inc. CFO vice president treasurer

$1,615,862 $1,165,428

38.6

$451,500

NA

$395,739

$96,054

$233,195

$393,682

$45,692

22

Michael J. Tokich/Steris plc CFO, principal accounting officer, senior vice president, treasurer

$1,465,276 $1,171,570

25.1

$391,007

$0

$240,840

$373,668

$422,405

NA

$37,356

23

Joseph J. Levanduski/A. Schulman Inc. CFO, executive vice president

$1,418,953 $1,301,550

9.0

$456,881

$0

$643,685

$0

$265,980

$0

$52,408

24

Christopher A. Chapman/Diebold Nixdorf (3) CFO, senior vice president

$1,380,114 $1,514,259

(8.9)

$402,658

$0

$499,284

$263,740

$180,000

$0

$34,432

25

Terrence E. Bichsel/FirstMerit Corp.

CFO, senior executive vice president

$1,348,421 $2,056,942

(34.4)

$476,950

$0

$471,023

NA

$339,362

$0

$61,086

26

Bradley C. Richardson/PolyOne Corp.

CFO, executive vice president

$1,326,721 $1,541,188

(13.9)

$564,823

$0

$256,409

$260,740

$164,844

$0

$79,905

27

Luke J. Petherbridge/DDR Corp. former CFO, treasurer

$1,270,685 (4) NA

NA

$362,503

$0

$498,694

$39,965

$347,750

NA

$21,773

28

George E. Strickler/Stoneridge Inc. CFO, executive vice president, treasurer

$1,258,401 $1,256,660

0.1

$384,100

NA

$588,120

NA

$263,404

NA

$22,777

29

Ware H. Grove/CBIZ Inc. CFO, senior vice president

$1,192,352 $1,178,603

1.2

$416,319

$0

$280,500

$175,500

$289,536

$0

$30,497

30

Patrick W. Fogarty/Park-Ohio Holdings Corp.

CFO, vice president

$1,107,214 (5) $990,380

11.8

$313,750

$375,000

$392,800

$0

$0

$5,010

$20,654

31

Greggory W. Branning/Myers Industries Inc. former senior vice president, CFO, secretary

$1,086,402 (6) $858,060

26.6

$392,700

$0

$138,306

$127,233

$413,470

$0

$14,693

32

Michael F. Biehl/Chart Industries Inc. former CFO, executive vice president

$1,047,170 (7) $1,312,400

(20.2)

$420,000

$0

$245,963

$299,690

$0

NA

$81,517

33

Eric R. Graef/Preformed Line Products Co. CFO, vice president of finance, treasurer

$1,000,838 $1,033,177

(3.1)

$344,400

NA

$365,945

NA

$193,725

NA

$96,768

34

Paul F. DeSantis/Omnova Solutions Inc. CFO senior vice president

$941,834 $753,191

25.0

$420,200

$15,000

$308,632

NA

$198,000

$0

$10,544

35

Christopher J. Holding/TimkenSteel Corp.

CFO, executive vice president

$907,419 $1,147,721

(20.9)

$364,583

NA

$333,500

$147,606

$0

$0

$61,730

$0

RESEARCHED BY CHUCK SODER Numerical information provided by S&P Global Market Intelligence, www.spcapitaliq.com. 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. The Book of Lists and individual lists are available to purchase at www.crainscleveland.com.

(1) Hiring announced in April 2015. (2) Promoted to CFO in April 2015. (3) Formerly Diebold Inc. (4) Hired in March 2015; left company in May 2016. (5) Promoted to interim CFO in June; named CFO in September. (6) Left company in March 2016. (7) Left company in April 2016.

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