FEBRUARY 2013
T
H INS IS I IS DE S U E :
February Meeting: Looking over the cliff KOOYENGA: LEGISLATIVE UPDATE
BAUMANN: STARTUPS & RED TAPE
STARR: WELLNESS WORKS
no business is small At AT&T a storefront is as important as a skyscraper. Small businesses are the backbone of our economy. They are the engines of new opportunity and growth. Having access to innovative technologies drives success. And we’re here to make sure you’re connected. Always. AT&T is proud to support the Independent Business Association of Wisconsin.
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IBA MEDIA LINK Governor Scott Walker talks about mining jobs in Wisconsin. Click here to listen.
Executive Director Steve Kohlmann Heritage Printing / Cultivate Communications President Ann Barry Hanneman Simandl Law Group S.C. President Elect 2013 Steve Van Lieshout K & S Technologies VP. State & National Programs Jeff Hoffman Judson & Assoc. Secretary John Weber Hypneumat Treasurer Casey Malek Kolb & Co. Membership / Sponsorship Heather Baylor Park Bank
Directors Bart Adams Kolb & Co. Larry Elton Advantage Leasing Richard Blomquist Blomquist Benefits
Seth Godin takes a humorous look at things poorly designed and how to fix them. Click here to watch video.
Jason Kuwayama Godfrey & Kahn Tom Boelkow BSI Design, Build, Furnish Dave Drumel Staff Electric Nancy Major Safe Babies Healthy Families
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In Business - For Business
Political Advocacy • Education • Networking www.ibaw.com / 262-844-0333 / IBAWOffice@gmail.com
960 Timber Pass • Brookfield, WI 53045 • Phone: 262-844-0333
Business Presentation Series
“Over the fiscal cliff... & into the tax woods we go!” On January 2, 2013, President Obama signed “The American Taxpayer Relief Act of 2012.” The agreement was reached by Congress and the White House and addressed various tax rate cuts that were set to expire in 2013, which would have resulted in tax hikes for all taxpayers, and became part of the debate on the “fiscal cliff.” Jim Brandenburg, Kolb +Co. tax shareholder, will discuss the background on what led to the need for the agreement and summarize the tax changes and what these will mean for individuals and businesses.
Jim Brandenburg Kolb & Co.
Friday, February 15th 7:00am– 9:00am The Wisconsin Club, 900 West Wisconsin Ave, Milwaukee, WI IBA Member - $30 • Future Members - $40 • To register click here. SAVE THE DATE! February 7th ! 7:30 AM - 9:30 AM Power Breakfast Held at WCTC
February 13th: Business Day in Madison. See ad in this magazine for details & registration information
“Innovation...because growth matters” Presented by: Christine McMahon Click here to register.
Special Lunch Event! March 22 WI Supreme Court Justice Roggensack LUNCH MEETING - Held in Brookfield This lunch meeting will replace our usual breakfast meeting. Registration information coming soon.
IBAW POWER BREAKFAST A U R FEB
H T 7 RY
“Innovation … because growth matters!”
No organization can allow necessity to be the mother of invention. Existing size and profitability do not guarantee future success. Claudio Feser, author of Serial Innovators, states that “history is full of organizations that were once admired global leaders but no longer exist.” Statistics show that roughly half of the companies that exist today will not be in business a decade from now.
TIME: 7:30 AM - 9:30 AM (Breakfast at 7:30) WHERE: WAUKESHA COUNTY TECHNICAL COLLEGE COST: Admission: $20.00 - Continental Breakfast included! Register: Click Here
Leaders today cannot leave their future to fate - innovation must be integrated into the business strategy. Leaders must nurture a culture where outdated habits are replaced with the encouragement of new ideas, diversity of viewpoint and constructive dissent. In this session, you will learn the necessary elements that create a culture of innovation where ideas, big and small, are transmuted into measurable action plans. Our session will be held in the Harry V. Quadracci Education and Technology Center (shown as the Q Building on the campus map). Street map: http://www.wctc.edu/general_info/maps/pewaukee.php Campus map: http://www.wctc.edu/general_info/maps/floorplans/printable_wctc_map.pdf The session will be held in room Q-365. Free parking in front and along the west side of the building.
Our presenter... Christine McMahon is a Business Strategist and principle of CMA, LLC. Prior to launching her business 17 years ago, she worked with Procter & Gamble, Slim-Fast Foods and Nabisco as a sales leader developing top performing sales teams. Her expertise is creating the business strategy that supports innovation and generates profitable sales growth.
Full Schedule Ahead! Steve Kohlmann, IBAW Executive Director
Ah February. We’ve made it through the Holidays and the long month of January, which can be a notoriously brutal part of winter, came and went without much fan fare. Nice. While February is a shorter month it’s packed with plenty of action moving us closer to spring. As a motorcycle fan February means Daytona, an motorcycle event which breaks the back of winter. There’s a lot happening at the IBAW office as we move into February. We have been busy adding events that we know will interest you. On February 7th we’re hosting a learning event at Waukesha County Technical College presented by Christine McMahon titled: “Innovation…because growth matters.” If you’re feeling in a mid winter rut, this is a nice opportunity to take a look at how your business is doing and maybe look at it in a different way. Christine is a great speaker and with the networking and included breakfast, I’m sure this event will be well worth the $20.00. Event details are listed in the front of this magazine at events page. Business Day in Madison is February 13th held at Monona Terrace in Madison. This event is sponsored by our friends at WMC (IBAW is a partner for this event) and gives you a great opportunity to network with fellow business owners & executives from around the state along with national speakers on timely business & political topics. Attendance comes close to 1000 people so it really is a unique opportunity to meet new people. See the ad in this magazine for more information. Our monthly meeting on February 15th will feature Jim Brandenburg of Kolb & Co. On January 2, 2013, President Obama signed “The American Taxpayer Relief Act of 2012.” The agreement was reached by Congress and the White House addressed various tax rate cuts that were set to expire in 2013, which would have resulted in tax hikes for all taxpayers, and became part of the debate on the “fiscal cliff.” Jim will discuss the background on what led to the need for the
agreement and summarize the tax changes and what these will mean for individuals and businesses. Jim’s very good at explaining complicated government policies in a way we can all understand. Big news for our monthly meeting in March. There will NOT be a breakfast meeting at the Wisconsin Club on March 15th. Instead, we’ll be hosting a LUNCH meeting on Friday, March 22nd at The County Springs Hotel in Waukesha. The change in time & venue is to accommodate our speaker; Wisconsin Supreme Court Justice Roggensack. We felt the Supreme Court race was important enough to warrant the change in time & location so please join us in Waukesha for what will be a most interesting presentation. We’ll be back at the Wisconsin Club the third week of April for our usual monthly meeting. (Speaker to be announced shortly.) There’s one more event in March that is still pending and I’m still working out the details. The ever changing schedule of elected officials makes it hard to confirm dates & times. I won’t make any announcements yet but if you want to ‘save the date’ Monday, March 25th is something you might want to pencil in between 1:00 pm & 3:00 pm. As soon as I can firm up this event I’ll be able to give you more details That’s about all for right now. Don’t forget to share this information with your business associates to help spread the word of IBAW. I hope to see you at one of our events in February!
LEGISLATIVE UPDATE Letter to the IBAW DALE KOOYENGA, State Assembly, 14th District
Just over two years ago I was sworn into office with four other Certified Public Accountants (CPAs); four out of the five of us were sworn in as freshmen members of a new Republican class. This meant that for the first time in history the Wisconsin Assembly had more Republican CPAs than attorneys. A number of factors led us to run. One of them was the dishonest accounting the state was using to balance the budget. The accounting gimmicks were abundant and as a result the state accumulated a $3.9 billion Generally Accepted Accounting Principles (GAAP) debt. The GAAP debt represented the fourth largest debt in the country. In December the public received Wisconsin’s audited financial statements, commonly referred to as the Comprehensive Annual Financial Report (CAFR).The audited financial statements revealed for the first time since 2003 that elected officials in Wisconsin used honest accounting principles (i.e. GAAP) to balance the state’s budget. In addition, surpluses were generated that decreased the inherited GAAP balance by $783 million. It may be confusing as to why Wisconsin still has a GAAP deficit, when in fact, last session legislators budgeted using GAAP accounting. Let us use an illustration to explain: John and Mary are married on January 1, 2011. Mary is financially responsible, never spending more than she earns. John, on the other hand, always spends more than he makes, and as a result, enters into marriage with $10,000 in credit card debt. Mary instills her budgetary discipline on her new husband and at the end of the year they are very pleased that as a newly married couple they did not spend more than they earned. They lived within their income, but did not generate the additional income necessary to pay down the $10,000 in debt inherited from John prior to the marriage. The same principle from this illustration mirrors Wisconsin’s GAAP deficit, but unlike John and Mary, the state paid down $783 million of the $2.9 billion inherited of the inherited debt. The bottom line is Wisconsin is making progress on this debt, but there is still more work to do. The first 90 days of the legislative session will be fast-paced. The first order of business is the reintroduction of the mining legislation that passed the Assembly last session, but failed to pass in the Senate. The bill has been modified from last session, but the overall results will be no different. Wisconsin’s mining industry is already gaining momentum as a result of frac sand mining. This form of mining is done in a manner that protects the environment while also creating jobs; iron ore mining will be no different. Critics will say the legislation will gut our environmental protections, but Wisconsin’s environmental laws will be just as strong as our neighbors, Minnesota and Michigan. Both of these states enjoy successful mining operations while also protecting the environment. Keep in mind, the Environmental Protection Agency (EPA) regulations, Army Corps of Engineers and other federal guidelines will be the same or weaker than Wisconsin’s environmental protections.
The second order of business is one of particular interest to any business professional who conducts business in or around Milwaukee County. Legislation introduced by State Representative Joseph Sanfelippo (R-West Allis) will reform the Milwaukee County Board to part-time status and cut over $5 million from the board’s annual budget. One of the few criticisms I have heard from the 20 percent who are opposed to the reforms is that we should be focusing on jobs. However, this is exactly why we are pushing for reforms. When government is dysfunctional, businesses are less likely to invest and citizens are less likely to find employment. Milwaukee County is 100 percent incorporated and numerous operations such as the county hospital no longer exist. Other county operations including administration of food aid, child care and medical assistance programs are now administered at the state level. Every county in Wisconsin other than Milwaukee County administers their own food aid, child care and medical assistance programs and are able to accomplish these programs with part-time county supervisors. In addition, the other Wisconsin counties are responsible for unincorporated land which is no longer the case in Milwaukee County. It is time to rethink Milwaukee County government. These reforms represent taxpayer and business-friendly reforms. The most important legislation to be introduced in the first sixty days will be the Governor’s biennium budget. The budget is set for introduction for the month of February and Governor Walker is hinting that the budget will include tax cuts and education reforms. Both are admirable endeavors. I believe it is imperative that the state cut taxes. This summer some of my colleagues and I spent considerable time studying Wisconsin’s tax code. I have to admit, even as an accounting professional, our state’s current tax code is challenging and cumbersome. The tax code is the 7th worst tax code in the country for businesses according to the Tax Foundation index - a result of the code’s complexity and higher rates. As a member of the Joint Finance Committee, I look forward to simplifying the tax code. We need to eliminate ineffective credits and redirect the cost of the credits to lower rates for every taxpayer. Among numerous other tax changes, I will be proposing eliminating Wisconsin’s Alternative Minimum Tax (AMT) and conforming Wisconsin’s depreciation schedules to the federal depreciation schedules so Wisconsin businesses are not forced to maintain a third or fourth set of schedules. If you have any thoughts to share on simplifying our tax code, it would be great to hear from you. Thank you for investing in Wisconsin. I look forward to seeing you at future IBAW events.
January Meeting Recap... Scott VanderSanden, President of AT&T Wisconsin and member of the Executive Committee for Competitive Wisconsin, gave IBAW members & guests a full overview of the Be Bold 2 findings. To learn more about Competitive Wisconsin and BB2, visit their web site by clicking here. The group also received an update on the latest technology breakthroughs AT&T is developing for your home, office and believe it or not, your car. AT&T has invested over $14 billion in technology ranking it above such companies as Disney, Boeing, Ford and even Microsoft.
VIP Guests Who Joined Us For Breakfast... State Senator Leah Vukmir gave an update on the mining bill.
Tim Peterson introduces Jeffrey Montgomery of Pinnacle School of Technology
Rebecca Bradley newly appointed Milwaukee County Circuit Judge
Don Pridemore candidate for DPI Superintendent
Challenges of new business startups...what can reduce red tape? Wendy K. Baumann, WWBIC President / CVO
We are all aware of real (and sometimes perceived) red tape in starting and growing a business. I have been involved in small and micro-business development now for almost thirty years and would suggest the following to entrepreneurs and small business owners. · Shop the programs online: The Small Business Administration (SBA), state government programs through the Wisconsin Housing and Economic Development Authority (WHEDA), the Wisconsin Economic Development Corporation (WEDC) and economic development corporations like the Wisconsin Women's Business Initiative Corporation (WWBIC), a Community Development Financial Institution (CDFI) all have great websites that share what they offer to and for startup businesses. · Attend no cost or low cost financing seminars, informational sessions and educational training. All of the organizations noted above and others including BizStarts (Milwaukee based), the University of Wisconsin's Small Business Development Centers (SBDCs), again WWBIC and others provide excellent training targeted at early stage and startup businesses. Make sure you match the organization with your needs. For example: BizStarts focuses on high growth potential companies who might be appropriate for private investment, while WWBIC works with all entrepreneurs and small business owners statewide yet focuses their efforts on women, minority and lower-wealth individuals. · Develop a business plan for starting your business venture and make sure that is aligned with the possible funding source you might pursue. If you can obtain traditional bank financing… do it. If you will need support and alternative financing for a guaranty or gap support - do realize that you will need to provide information and will need to go through a process. More and more organizations providing this support have streamlined systems and are able to get answers much quicker but research and providing the required documentation does take time. At WWBIC, we secured an online loan platform which allows potential borrowers to apply for a loan 24-7 and then receive an initial indication of status rather quickly. A green light… looks promising and is ready to move to the next step - a yellow light… has possibility but additional information is required or a red light… shows we cannot move the credit along at this time. · Talk to people - we find that people and specifically business owners and entrepreneurs LOVE to talk about what they do – Do your homework and find a similar business or a comparable in the industry and ask questions… lots of them. Find out how they started, how they secured financing for development, or take a look at their marketing plan along with projections. WWBIC is a statewide economic development corporation that has provided quality business and financial education coupled with access to fair capital and financial products for over 25 years. WWBIC maintains offices in Milwaukee, Racine, Kenosha and Madison. For more information go to www.wwbic.com Wendy K. Baumann has served as WWBIC's President/CVO for nearly 20 years. Previously she was Director of Small Business Development at the Milwaukee Area Technical College (MATC) and provided support to MATC's two large business incubators in the heart of Milwaukee.
Wellness Programs What is it good for? Everything! The Important Impact on Workers Compensation Tim Starr, The Starr Group
Hi, my name is Tim Starr, President of the Starr Group a 2012 Corporate Wellness Award Winner. We are an IBAW member who provides Total Risk Wellness Risk Management to not only our own firm but to our customers as well. The reason we exist is for Your Total Risk Wellness- because we are in this together. This happens to be a holistic approach to helping businesses in their management of risk in both Business Insurance and Group Health-specifically Wellness. I share this to help you, as a business, understand that Total Risk Wellness encompasses not only a traditional safety culture promoting improved Workers Compensation loss results but ALSO ideally a robust Wellness behavior within your company. You see, we now know statistically, a robust Wellness program not only helps with absenteeism, presentism, lower Health Insurance costs BUT ALSO better Workers Compensation results thereby reducing your Workers Compensation interest rate- your Experience Modification factor. For years businesses have been embracing “best practices” of safety/risk management in their workers safety and now for the first time we have quantifiable proof this same ideal applied via embracing Wellness has an undeniable positive result for Health Insurance premiums, absenteeism and presentism and better Workers Compensation loss results-surprise right?. This is a powerful incentive to installing a robust Wellness program. It is suggested businesses can no longer ignore the importance of installing Wellness within their companies. No doubt the most direct positive impact of a robust Wellness program is felt by those companies that are self insured and usually with 50 or greater employees. This is because of how Health insurance companies develop premiums for the 50 and greater employee groups. Additionally, if you are self insured, the potential reward via lower premiums are even greater as your own health experience is instrumental in determining your premiums. Let me be clear though, regardless of this inherent potential benefit, the positive impact you can experience in presentism, absenteeism and improved Workers Compensation loss results of your employees is not to be overlooked no matter how many employees you have! Wellness programs result in an average reduction of 28% in sick days, and average reduction of 26% in health costs and an average reduction of 30% in workers compensation. These findings support predictions that the country will successfully transition the health care system over the next 10 years from one that fixed people who were sick to one the helps, prevents and diagnoses disease. Ultimately, we are trying to keep people “out of the system” or at least getting them into the system much earlier than they
would otherwise be in it thereby reducing health costs because they entered at a stage that was in a reduced state of health severity. Let me share a true story. There is a Wisconsin company that has embraced a robust Wellness culture for many years wherein they have had 1 health insurance rate increase in the last 9 years! Not possible you say? It is true. They happen to be self insured and utilize wellness opportunities of “carrots and sticks” to the fullest. This means incentivizing those employees who agree to participate. The particular Wellness platform they are utilizing plays a huge part in this success story including variables within their Wellness platform that are significant including the broadness of the algorithms in the HRA (health risk assessment), the blood draw (not finger prick) utilized in the Biometric screenings. This blood panel alone tests for 40 variables. This is very significant. Let me give you a comparison. If you go to the doctor today because you are not feeling well, in other words symptomatic, your doctor may order a blood panel of 8 compared to 40. So invariably, the 40 panel is measuring many more potential problematic areas. Additionally, this particular program is portable meaning it is YOUR companies data and continues to go with YOU regardless of the insurance company you are insured with- this is critical! Nothing matters but by comparison so if you are in a wellness program from a particular insurance company your data almost inevitably remains with that insurance company if you should switch companies. Lastly, this program includes ALL employees including those that are not on the health insurance program and includes spouses of that employee and their children. The overall point? The Wellness platform your business is utilizing is absolutely critical because you have to own the data so you can carry it with you from insurance carrier to insurance carrier from year to year. The results of this true story are not the norm but it can become the norm for a vast many of businesses out there IF they are working with the right organization. Let’s face it, even if you do not have those kind of results how does this compare to where your company is at today in its Wellness quest? Many businesses that embrace a robust Wellness program lay claim to the fact they know they save a life a year with their behavior and even if your premium results are not the same remember the impact you have on absenteeism, presentism and better workers compensation results- all additional benefits to a robust Wellness behavior. So, wellness, what is it good for? Well, that is like asking what did safety do for your company, its employees and your interest rate (experience modification factor). The fact is Wellness improves Workers Compensation results and A LOT more! To learn more stay tuned for the most powerful Wellness Seminar to date in Milwaukee on March, 14th 2013. The Starr Group will be posting the invitation in the IBAW newsletter. Why is this seminar powerful? First off it includes the who’s who of companies that experts look to for advice including the head of HR from the Wisconsin company that has had the one Health Insurance rate increase in only 9 years. Additionally, the 4 speakers will help you understand strategies to be used to take advantage of the new Health Care Laws. Stay tuned- this is absolutely for CEO’s, CFO’s and of course HR.
11th Annual
Business Day in Madison
Registration now open! Click HERE to register!
February 13, 2013
Monona Terrace Community & Convention Center, Madison
In November, America decided our elected officials should stay the course. But what does that mean for your business, your employees, your families and our nation? Will our leaders be dedicated to economic growth and opportunity? Please join us as we present some of the brightest minds in the nation to discuss the future. Registration Rates Early bird - $125 per person; Regular rate - $155 per person Early bird - $900 per table of 8; Regular rate - $1,140 per table of 8 (after January 11, 2013) Tuesday - February 12th 5:00-7:00 p.m.
ELECTIONS
ECONOMY
GEOPOLITICS
Welcome Reception
Wednesday - February 13th 7:30-9:00 a.m.
VIP Breakfast (sponsors only)
9:00-10:00 a.m.
Dr. Barry Asmus
10:00-10:30 a .m.
Break
10:30-11:30 a.m.
Stephen Hayes
11:30 a.m.-1:00 p.m. Luncheon and Keynote General Michael Hayden 1:30-2:30 p.m.
Governor Scott Walker
2:30 p.m.
Adjourn OR Legislative Visits
2:30-4:30 p.m.
Dr. Barry ASMUS Economist; Best-selling Author
Stephen HAYES Analyst, Media Personality, Author
General Michael HAYDEN Former Director of the Central Intelligence Agency Former Director of the National Security Agency
Creating a Favorable Climate for Business
America’s Political Landscape: 2013 and Beyond
Hot Spots at Home and Around the World
GUEST SPEAKER
PROGRAM EMCEE
Governor Scott WALKER
Charlie SYKES Talk Show Host WTMJ Radio
Please be our guest at the Welcome Reception on February 12th, 2013 at The Madison Club. No charge for program registrants. Fee: $30/person if not registered to attend Business Day in Madison. State Agency Secretaries and Wisconsin State Legislators will be invited.
A program presented in partnership with the WMC Foundation, Inc.
Welcome New IBAW Member!
You Can Make a Difference In Wisconsin! Spread the word of IBA to your business associates pass on the IBA brochure!
Brian Preiss MOR Strategy Group
Download it in PDF format or pass the link on. Available at www.ibaw.com
Get Informed Get Connected
Join Wisconsin’s premier business association! Contact IBAW by clicking here.
Get Involved
THANK YOU TO OUR SPONSORS... ATT Altria Industrial Towel & Uniform Blomquist Benefits Associated Bank Kolb & Co. Godfrey & Kahn Park Bank Lauber CFO’s von Briesen Vrakas / Blum
Advantage Leasing Grace Matthews Jackson / Lewis Law Offices BSI - Design, Build, Furnish K & S Technologies Judson Commercial Real Estate Hypneumat Wells Fargo Bank Media Partner: Cultivate Communications Heritage Printing
IBAW 960 Timber Pass Brookfield, WI 53045 Office: 262-‐844-‐0333 WWW.IBAW.COM
Membership Application
Name____________________________________________________________________________________ Company_________________________________________________________________________________ Type of Business___________________________________________________________________________ Address__________________________________________________________________________________ City, State, Zip_____________________________________________________________________________ Phone____________________________________Fax_____________________________________________ Email______________________________________Website________________________________________ PLEASE CHOOSE THE APPROPRATE CATEGORY FOR YOUR INVESTMENT IN THE GROWTH AND STABILITY OF SMALL BUSINESS
AMOUNT
NUMBER OF EMPLOYEES IN COMPANY ANNUAL DUES
1 ʹ 5 $215
6 ʹ 15 $275
16 ʹ 25 $375
26 ʹ 49 $470
50 or more $600
Sustaining Member $700
Special! ʹ Pre pay breakfast meetings ʹ 12 for the price of 10 $300
ENCLOSED AMOUNT:
PAYING BY CHECK ? Make checks payable to IBA ʹ and mail to: IBA 960 Timber Pass Brookfield, WI 53045 WANT TO PAY ONLINE? You can also pay by Mastercard / Visa at the IBA Membership page. www.ibaw.com ________________________________________________________________________ The Independent Business Association of Wisconsin is a not-for-profit entity filed with the IRS under 501(c)(6) of the Internal Revenue Code. As a not-for-profit association, the members of The Independent Business Association, Inc. are allowed to deduct a percentage of dues that are not used for lobbying purposes. For the year 2012 based on the total income of the association and the lobbying expenses as reported on the Wisconsin State Ethics Board Lobbying reports for 2011 the percent of dues that were used for lobbing purposes is 15%. Therefore, the percent of dues that would be tax deductible is 85%.