May/June 2017 Idaho State Business Journal

MAY/JUNE 2017 BIZ.IDAHOSTATEJOURNAL.COM

n new solar projects are creatIng a prIce problem for local utIlItIes n Isu to offer master of taxatIon degree n retIrement plannIng can jump-start the ultImate vacatIon

2 May/J u ne 2 01 7

Ida ho St ate B us i ness J o urna l

In this issue New solar projects are creating a price problem for local utilities Page 4 Is the American dream fading?

Page 6 AAA: Many drivers nor prepared for repair blindside Page 6 ISU to offer Master of Taxation degree Page 8 St. Anthony entrepreneur opens gourmet burger grill Page 9

about

Growing Population Page 10 How Trump insurance changes could affect coverage next year Page 12 Applying for a Small Business Loan Like a Boss Page 13 Be aware of health care scams Page 13 Say No to Food Waste Page 14

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May/J u ne 2 01 7 3

Id aho St ate B u s in ess J ournal

let ter from the editor

The Idaho State Business Journal

What do you want?!

T

eration perceives the here’s an iconic scene in the American Dream (see movie “The Note“American Dream” on book” where Noah page 6). defiantly bars the way Years ago, I was when the love of his interviewing a candilife, Allie, tries to get date for a position at SARAH into her car and leave. a publication. As we GLENN Connoisseurs of rochatted from our ofmance movies can fice chairs, I asked her probably hear the despera- what she wanted out of tion in his voice as he asks, this job. I honestly can’t re“What do you want? What member what she said, but do you want?!”

I remember it was some A tearful Allie replies, “I long-winded fantasy about don’t know.” her hopes and dreams It’s an exchange that, for her future. Although I’m sure, has happened at we ended up hiring her, both conference tables and months later she was gone kitchen counters across with the wind, breathlessly America. Now what I say chasing another adventure. next is going to make me She was a woman ahead sound like an awful curof her time, because now it seems everyone is that mudgeon. But, kids these way. Want some data to days, they want to be able back it up? Seventy-eight to pay the bills but beyond percent consider having that … it’s a mystery. personal freedom the most It was incredibly eyeopening to see how bumpy important part of their American Dream. Achieveconomic roads have ing affluence and permachanged how a whole gen-

nence is farther down on most people’s priorities list — only 28 percent of Americans thought that was important.

This is a problem folks.

You want to know who has success knocking on their door? The people who had the chutzpah to chase their vision, relentlessly. Take Krysten Davis, for example (see “Burger Grill” on page 9). The 24-year old had a dream — opening a gourmet burger restaurant in her hometown. At least for a while, her new business will be the puppet master pulling the strings on her time and personal freedom.

But these small business entrepreneurs are the engine that keeps our economy humming.

Could you imagine the overdrive that the economy would go into if the Noahs of the business world never had to wonder, “What do you want?”

is published by the Idaho State Journal.

Our mailing address is: 305 S. Arthur Pocatello, ID 83204 Main number: 208.232.4161 | Subscriber Services: 208.232.6150 Copyright © 2016 Pioneer News Group, All rights reserved.

Idaho State Journal Publisher: Andy Pennington | APennington@journalnet.com Idaho State Business Journal Editor: Sarah Glenn | SGlenn@journalnet. com Contributors: n Janna Graham/Pocatello Co-op | outreach@pocatellocoop.com n Jennifer Landon/Journey Financial Services | www.journeyretirement.com n Kendra Evensen | kevensen@journalnet.com n Robert Spendlove/Economic and Public Policy Officer for Zions Bank | Robert.Spendlove@zionsbank.com n Emily Valla/Better Business Bureau, Northwest Region | www.BBB.Org/Northwest Idaho State Business Journal Designer: Danae Lenz | dlenz@journalnet.com

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4 May/J u ne 2 01 7

Ida ho St ate B us i ness J o urna l

heRe Comes the sun NeW SOLaR PROJeCTS aRe CReaTINg a PRICe PROBLeM FOR LOCaL uTILITIeS

by sarah glenn For the Journal

T

his year in Southeast Idaho the sun is shining, the wind is blowing and the water is rushing — creating a boom in renewable electricity generation. As the grid overflows with power, homeowners are also tossing open the shutters and letting spring breezes do the work of their thermostats.

Supply is up, demand is down and yet, Idaho Power is raising residential rates.

The average residential customer can expect to pay about 59 cents more per month beginning June 1. There are other price increase proposals in the works, so you may see more of an increase on your bill come June. Rates went up the year before too by about 3.5 percent.

“It is a little counterintuitive,” said Idaho Power spokesman Brad Bowlin as he tried to explain the conundrum.

According to Bowlin, a glut of new renewable energy projects pumping electricity into Idaho Power’s grid have thrown a wild card into the price planning equation. here comes the sun … and wInd and water As January dawned, 13 solar farms began adding 270 megawatts to Southeast Idaho’s energy grid. Just a year before, that number had been zero. Another 20 megawatts are under contract. Existing wind farms add another 627 megawatts of energy to Idaho Power’s grid.

And then there’s the water.

More than 80 percent of Idaho’s net electricity generation comes from hydroelectric power plants. Four of Idaho’s 10 largest generating facilities run on hydropower. The three dams making up Idaho Power’s Hells Canyon complex on the Snake River constitute the nation’s largest privately owned hydroelectric generating facility, according to the U.S. Energy Information Administration.

Zooming in on Southeast Idaho, hydroelectric usually accounts for 50 percent of net electricity generation. During a long, cool and wet spring that percentage can be as high as 63 percent, Bowlin said.

“It’s also important to understand that the availability of water for hydroelectric

generation depends on many factors, including how fast spring runoff occurs, which in turn shapes how much runoff remains in the summer when demand for electricity peaks,” said Idaho Power Vice President of Regulatory Affairs Tim Tatum. “If the snow melts too quickly, flood control efforts take priority, and in some cases excess water must be spilled, rather than used for generation, to avoid overfilling reservoirs. Idaho Power is currently facing this situation.”

That’s not to mention the eight other coalfired or natural gas plants scattered across the state. They are also producing a lot of power.

Because of this oversupply, the market price for a megawatt is plummeting. Unfortunately, that puts Idaho Power in a sticky situation. the purpa problem The nation’s solar and wind farms operate under the federal Public Utility Regulatory Policies Act (PURPA). The act requires Idaho Power to pay for all of the electricity the renewable energy farms generate, even though Idaho Power says it doesn’t need the energy to serve customers’ demands.

Sometimes the weather cooperates and Idaho’s clean power producers pump out a lot of energy. However, there are the days when the wind doesn’t blow and the sun doesn’t shine.

To make sure the lights stay on across Idaho, utilities need to keep around the more traditional sources (like coal and natural gas).

When faced with excess energy, Idaho Power is forced to reduce output from its own facilities to accommodate the energy from renewable projects.

According to a statement from Idaho Power, scaling down its own generation resources, including hydroelectric projects, can still leave the company with excess electricity that must then be sold into a market where prices are low because of a regional oversupply. The company is then forced to pay for high-cost energy when less-expensive resources are available and sell the excess at a loss.

The cost of this energy is ultimately passed on to Idaho Power customers through the state-regulated rate-setting process.

your power bIll With spring runoff flowing down Idaho’s mountains, odds are increasing that the region will see an oversupply of wind, solar and hydro generation when demand for electricity is generally low. It’s a regionwide issue that is already familiar to Idaho Power’s system managers, who have been

handling a growing supply of energy from wind and solar projects for several years.

All of their predictions and number crunching culminated in an annual document called the Power Cost Adjustment.

Idaho Power files one of these PCA’s every spring with the Idaho Public Utilities Commission.

May/J u ne 2 01 7 5

Idaho St ate B u s in e ss J ournal the field seemed rich and ready to harvest. These PURPA contracts meant that solar farms would get a fixed, guaranteed price for their power paid for 20 years.

But no more.

In 2015, the Idaho Public Utilities Commission granted a request made by the state’s major utilities to reduce the length of negotiated renewable energy contracts covered

by PURPA. The decision reduces the length of contracts to two years, after regulators found longer

contracts led to customers paying higher costs for renewable power.

The change means that utilities might be able to better control wild swings in your power bill. But it also means Idaho likely won’t get many more solar farms knocking on its door.

A solar project slated for the Pocatello Regional Airport pulled out in May 2016.

If it had gone forward, Pocatello would have pocketed $1,500 per year for the first two years while

the solar panels were being built.

For 20 years after that, the city of Pocatello would be paid 3.4 percent of the operation’s gross revenues. That’s not to mention the construction jobs.

Because of the new length of the PURPA contracts, it’s not coming back.

“This is a big loss for us,” said David Allen, manager of the Pocatello Regional Airport when the solar project canceled. “Nobody can make money in two years.”

The The PCA is a cost recovery tool that passes on both the benefits and costs of supplying energy to Idaho Power customers. Neither Idaho Power nor its shareholders receive any financial return on this filing — money collected from the surcharge can be used only to pay power-supply expenses. These typically represent approximately one-fourth to one-third of the company’s annual cost of serving customers.

If the PCA proposal is approved by the Idaho Public Utilities Commission, the typical Idaho residential customer using 1,000 kilowatt-hours (kWh) of energy per month will see an increase of about 59 cents on their monthly bill, beginning June 1.

The amount all Idaho customer classes pay for electric service will increase by $10.6 million; the actual percentage of change will depend on a customer’s class and the rate they pay.

The PCA brings last year’s forecast costs in balance with actual expenses by looking back at what happened the previous April through March (called a “true-up”), and forward to the coming April through March (the “forecast”). Rates are established based on the forecast and the trueup to try and make that portion of a customer’s rates equal what it actually costs to provide electricity.

It’s not just Idaho Once final data are in, the U.S. Energy Information Administration expects that 24 gigawatts (GW) of new generating capacity to be added to the nation’s power grid during 2016. For the third consecutive year, more than half of these additions are renewable technologies, especially wind and solar.

Of the 2016 renewable nationwide additions, nearly 60 percent were scheduled to come online during the fourth quarter. Renewable capacity additions are often highest in the final months of the year, in part, because of timing qualifications for federal, state, or local tax incentives. Estimated fourth-quarter capacity additions for 2016 are based on planned additions reported to EIA and are subject to change based on actual project schedules.

Monthly U.S. renewable electricity generation peaked in March as high precipitation and melting snowpack led to a monthly peak in hydroelectric generation and strong wind resources led to a monthly peak in wind generation. Most renewable generation comes from the Western part of the country, which accounted for the majority of the hydroelectric (63 percent) and solar (77 percent)

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Ida ho St ate B us i ness J o urna l

AAA: Many drivers not prepared for repair blindside New survey shows 64 million drivers would have to pay for car repairs with debt

By Sarah Glenn For the Journal Is your definition of the American Dream different from your parent’s? Join the conversation on our Facebook page, Facebook.com/SEIdahobusinessjournal As America emerges onto the other side of the Great Recession, a new generation isn’t enamored with the white picket fence version of the American dream.

For decades, the economy has churned on the idea that we are working for something more than just money — we want to climb the prosperity ladder and be better off than our parents were.

However, for most that dream is now an old-fashioned notion. A new series of Pew Research studies show that the modern definition of the American Dream is just being able to pay the bills.

“Our findings show that despite a steady economic recovery, many Americans continue to feel vulnerable,” said Erin Currier, director of Pew’s financial security and mobility project. “Many worry about their finances, and record numbers — more than 9 in 10 — say it is more important to them to achieve financial stability than it is to move up the income ladder.”

Americans today are more optimistic about the state of their own finances and the economy than they have been in years, but at the same time only about half report feeling financially secure, according to a survey conducted by The Pew Charitable Trusts. Many of those polled say they are barely breaking even or spending more than they make each month, and more than half said they feel unprepared for a financial emergency.

The results, captured in a new issue brief, “Americans’ Financial Security: Perception and Reality,” are based on a nationally representative survey of more than 7,000 households, as well as focus groups conducted in Orlando, Boston and Phoenix. The survey gauged Americans’ perceptions of their financial security and how their views differ depending on their income, wealth, race, and other demographic factors.

Americans overwhelmingly said they prefer financial stability over economic mobility. However, the research suggests that such security is elusive: Even the best-off households find their finances strained when they experience a financial shock such as a major car or home repair or a loss of income.

Among the survey’s key findings: • Most of those surveyed (56 percent) rated their own financial situation positively, up from 42 percent during the recession in 2009. The proportion rating the economy positively climbed to 27

“Our findings show that despite a steady economic recovery, many Americans continue to feel vulnerable. Many worry about their finances, and record numbers — more than 9 in 10 — say it is more important to them to achieve financial stability than it is to move up the income ladder.”

— Erin Currier, director of Pew’s financial security and mobility project percent in 2014, up from just 9 percent in 2008.

• Only half of Americans (51 percent) said their households are financially secure, and more than half (56 percent) reported worrying about their finances over the past year, citing everything from short-term bills to retirement. A majority (57 percent) also said they are not prepared for financial emergencies.

• More than half (55 percent) report just breaking even or spending more than they earn each month, and onethird (33 percent) said their household has no savings.

• Only 45 percent of Americans reported having a steady income and consistent expenses, and 36 percent of this group said their households had no savings.

• Asked about their retirement plans, 1 in 5 (21 percent) said they are not planning to retire, while more than half (53 percent) anticipate doing something else, including working at a different job.

Just 26 percent have a traditional notion of retirement in which they stop work-

ing altogether.

• Six in 10 households (60 percent) reported experiencing a financial shock — such as a drop in income, hospital visit, loss of a spouse or partner, or a major car or house repair — in the past year. Of this group, 55 percent said the setback made it harder for them to make ends meet.

• When asked whether they would prefer to have financial security or move up the income ladder, the vast majority of Americans (92 percent) chose security, an increase of 7 percentage points since 2011.

The survey results supplement Pew’s analysis of financial data, released in January, that illustrated the precarious state of family balance sheets by examining families’ own perceptions of their financial security. The findings give policymakers additional information to consider when developing proposals to support the financial well-being of American families. More detailed demographic results from the survey will be released in the coming months.

BOISE — Drivers across the country will soon budget for a family vacation or bucket list adventure, but on their next road trip, great food and attractive accommodations may only be the tip of the financial iceberg, according to a new survey by AAA. The new survey shows that one out of three U.S. drivers — more than 64 million people — would not be able to pay for an unexpected vehicle repair without going into debt. The findings raise concerns that some motorists underestimate the costs of owning and maintaining a vehicle.

“Many Americans have car and health insurance to guard against the unexpected perils of life,” says AAA Idaho public affairs manager Matthew Conde. “Unfortunately, that kind of forward thinking does not necessarily apply to the essential repair and maintenance of our vehicles.”

A previous AAA survey found that one-third of drivers routinely skip or delay recommended service or repairs.

Industry experts estimate that an average repair cost runs from $500 to $600, and drivers can expect to pay $800 or more for routine maintenance over the course of the year. With that in mind, AAA encourages drivers to create a rainy day fund to address repair needs as they arise.

“Drivers should account for all the necessary costs of operating a vehicle before the unexpected happens,” Conde said. AAA recommends that drivers routinely verify that their budget adequately covers the following items: * Monthly car payments * Insurance premiums * Fuel costs * A monthly savings of $50 or more for future vehicle repairs Where possible, drivers are also encouraged to consider small lifestyle adjustments to further reduce the potential for excessive debt.

Prepare and prevent “Car manufacturers have a keen understanding of a vehicle’s performance capabilities,” Conde said. “AAA recommends that drivers follow the manufacturer’s recommended maintenance schedule to maximize long-term vehicle safety.”

Motorists are also advised to establish a relationship with a trusted repair shop well before the need for a major repair. A recent AAA survey shows that onethird of U.S. drivers have yet to select a trusted repair facility.

If a breakdown happens “In the event of an unexpected repair issue, drivers need to know that they still have options,” Conde said.

“Request a written estimate for the repair, and seek out a second opinion to make sure everything sounds fair and reasonable. In some cases, repair shops may be able to ease some financial stress through available discounts and payment plan options.”

In 2016 alone, AAA responded to nearly 32 million stranded motorists.

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Ida ho St ate B us i ness J o urna l

ISu to offer Master of Taxation degree

I

daho State University will begin offering a new degree this fall: a Master of Taxation (MTax).

The Idaho State Board of Education approved the program, proposed by ISU’s College of Business, earlier this year. University officials say the specialized degree will not only provide another career path for students, but will also help fill a market need.

“Experts in taxation are in demand in Southeast Idaho and nationally,” Dr. Daniel Ames, chair of the Accounting Department and associate dean, said in a news release.

Full-time students who already have an accounting degree will be able to take all of the required courses in as little as a year, and Idaho residents will pay approximately $12,000 in tuition, according to ISU officials. They say the national average salary for jobs associated with the degree start at $79,231.

According to PayScale.com, average salaries can differ by job, but they range from as low as $48,656 to $81,990 for a tax accountant to as high as $115,896 to $190,187 for a tax director.

Dr. Ramon P. Rodriguez Jr., faculty adviser for the Master of Taxation program, says the degree is a good option for those who know they want to work in

the tax industry.

Many schools began offering a Master of Accountancy (MAcc) degree when Certified Public Accountant (CPA) certification requirements increased to 150

semester hours, Rodriguez said.

But most programs don’t include very many tax classes, which has left a void in the market and created a need for a more specialized degree.

Emma-Anne Millard, director of tax talent acquisition for PricewaterhouseCoopers (PwC), which is one of the Big Four auditors, said they hire thousands of entry-level employees each year, and relatively speaking, few applicants have a MTax degree.

She thinks it’s a bonus when they do.

“It can jump off the resume and catch the eye of the tax recruiter (because those applicants will have a) better understanding of tax practice and can hit the ground running,” Millard said.

“If they do join the firm, they can get up to speed at the practice much faster than their peers who don’t have specialized degrees.”

Deloitte, which is also one of the Big Four, looks for applicants with backgrounds in tax, accounting, law or economics, according to its website.

“An academic skill necessary to succeed in Deloitte Tax is the ability to understand the underlying policy or theory behind tax rules, rather than focusing on memorization of code sections, limitation amounts, and various other thresholds,” the website states.

Millard says schools that offer a MTax degree can help draw more attention to the tax profession and help students to consider the career path sooner than they otherwise might.

“They may not consider tax or realize how many tax opportunities are out there in the account-

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by kendra evensen kevensen@journalnet.com

ing world,” she said.

ISU officials will continue to offer a MAcc degree along with the new MTax degree geared toward those who know they want to work in the tax industry.

In the news release, Ames said the MTax program will follow the same structure as the MAcc in preparing students for the four parts of the CPA exam. He notes that they’ve had an 88 percent first-time pass rate among MAcc students over the last three years.

“The MTax will overlap with the MAcc program in a handful of courses,” Ames said in the news release. “However, it diverges by offering several concentrated tax courses taught by our outstanding faculty members specializing in taxation.”

ISU officials say students who participate in the MTax program will receive specialized training in estate planning along with individual, corporate and partnership taxation.

Rodriguez said they did their homework before they decided to offer the degree.

“We’ve talked to undergraduates and there’s a lot of interest,” he said, adding that they got feedback from both ISU and Brigham Young University-Idaho students.

Those who are interested in learning more about the program can contact Heidi Shiosaki, ISU’s director of Graduate Studies, at wadsheid@isu.edu or call 208282-2966.

May/J u ne 2 01 7 9

Idaho St ate B u s in e ss J ournal

Montana & Idaho CDC helps St. Anthony entrepreneur open gourmet burger grill

A

young St. Anthony entrepreneur opened a new gourmet burger restaurant in late April with the help of a loan from the Montana & Idaho Community Development Corporation.

Idaho Burger Grill is the longtime dream of 24-year-old St. Anthony native Krysten Davis.

Serving residents and visitors to Eastern Idaho, the restaurant will offer a variety of traditional and specialty burgers and sides, with an emphasis on locally sourced ingredients and a casual dining atmosphere.

In 2016, Montana & Idaho CDC loaned $5.1 million — more than half the value of all its business loans last year — to 32 entrepreneurs and small-business owners in Idaho, including Idaho Burger Grill.

Davis learned about entrepreneurship firsthand from her parents, who owned and operated several small businesses in rural Idaho.

Throughout childhood, she honed her skills and work ethic at the family’s food truck restaurant.

By high school, Davis and her sister had assumed responsibility for the food truck’s operations — from cooking to financial management.

After completing her degree in agri-business at Brigham Young University-Idaho, Davis decided to pursue her dream of opening a gourmet oburger restaurant in her hometown. However, because of the startup nature of the business, Davis was unable to obtain traditional bank financing. She contacted Montana & Idaho CDC, a nonprofit that provides financing and consulting services to entrepreneurs and small-business owners.

“As a startup, I found it difficult to obtain financing for construction and to purchase the equipment I needed to open the business,” Davis said. “I learned about Montana & Idaho CDC through the Small Business Administration’s LINC program, which connects business owners with SBA-approved lenders.”

Montana & Idaho CDC recognized the strength of Davis’ vision, the depth of her industry knowledge and the strength of her business plan. In addition to providing Davis with a $120,000 loan for construction and equipment, Montana & Idaho CDC gave her technical assistance, including accounting support.

“Growing up in this business, it’s been a longtime dream to open a restaurant of my own,” Davis said. “It’s really special to be able to do so right here in St. Anthony. We think we’ll be able to offer something truly unique and special to both local residents and visitors passing through town.”

Montana & Idaho CDC specializes in providing loans to entrepreneurs and small-business owners who do not qualify, in whole or in part, for traditional bank financing for business startups, business purchases and existing businesses that are light on collateral or cash flow. In 2016, one-third of Montana & Idaho CDC’s loans went to startup businesses like Idaho Burger Grill.

Loans range from $1,000 to $2 million and can be used for purposes such as the purchase of real estate, equipment, inventory or an existing business, or for remodeling or working capital.

Loan clients also receive one-on-one technical assistance in financial management, marketing, sales management and other area of business management.

“Montana & Idaho CDC has been an incredible partner throughout this journey,” Davis said.

“Not only did they provide the capital I needed, but they also gave invaluable business advice that will set me up for success in the long term.”

“We are thrilled to be making our first loan to a small business in St. Anthony,” said Dave Glaser, President of Montana & Idaho CDC. “Small businesses like Idaho Burger Grill — and the visionary entrepreneurs behind them — are the building blocks of economically vibrant communities. We look forward to expanding our outreach and loans to small businesses in rural communities over the next few years.”

Submitted photo

St. Anthony native Krysten Davis stands in the Idaho Burger Grill, which she owns.

The Stockyard Burger

“Being the People’s Choice is the greatest reward any business can receive. It just reinforces our commitment to be the best we can possibly be for the community we serve.

Thanks from all of us at the Phil Meador Auto Group.”

1607585

By Journal Staff

10 May/Jun e 2 01 7

Id a ho St ate B us i ness J o urna l

Growing Population Understanding and Preparing for Big Things to Come

The Fundamentals of Population Change Changes in an area’s population are caused by natural increase and migration. Natural increase occurs when births outnumber deaths during a period of time. Natural increase tends to change gradually, although growth often happens in waves. The most famous wave recently was the large “baby boom” from 1946 to 1964. Migration occurs when people move in or out of an area, and is much more volatile than natural increase.

If more people are moving into an area than out of the area, it will experience net inmigration. However, if more people move out than move in, the area will experience net out-migration.

The U.S. and the West are Experiencing Strong Population Growth While many areas in the world are enduring stagnant population growth and outmigration, the United States continues to grow consistently, through both natural increase and in-migration.

The U.S. population is now around 325 million and is projected to grow to 417 million by 2060.

This reflects continued, albeit moderating, natural increase, combined with continued international migration.

America has always attracted people who want the opportunities and freedom available in our country and this is expected to continue in the future.

Within the United States, the West continues to attract people. The West continues to be one of the fastest growing regions in our country. This is reflected in the movement of the center of population in the United States.

The center population has consistently moved west and south since the founding of the U.S. and is now located near Plato, Missouri.

Strong Population Growth is Related to Strong Economic Growth The Western U.S. continues Robert Spendlove to experience strong population growth as more people seek the quality of life and access to outdoor recreation. The Intermountain West has the strongest economic environment in America and is seeing the highest job growth in the country. For the past several years, states such as Idaho, Utah, Washington, and Oregon have competed for the distinction as the state with the highest job growth in the country. As people learn about the strong job growth and healthy economic environments in the West, they are increasingly moving to these states. This is causing the net in-migration into these states to skyrocket.

Idaho is Among the Fastest Growing States in the Country From 2015 to 2016, Idaho was the third-fastest growing state in the U.S. Idaho’s growth rate of 1.8 percent was only surpassed by Utah and Nevada. During this time, the Gem State grew by more than 30,000 people. This is like adding an entire city the size of Rexburg over the past year.

Much of this growth is due to Idaho’s ability to attract many people into the state.

Idaho’s in-migration more than doubled from 2015 to 2016, with around 9,000 people moving into the state in 2015 and more than 18,000 people moving into the state in 2016. Idaho’s strong and vibrant economy is creating new jobs and shrinking the unemployment rate. As the demand for more workers increases, increasing numbers of people are moving here to take advantage of these economic opportunities.

Growth Brings Challenges While population growth brings opportunity and benefits to communities, it also presents challenges. Population growth, especially extreme growth, can limit access to much needed resources, such as land, water, infrastructure, and public services.

Communities often struggle to keep up with population growth and to plan accordingly. It can also be very expensive to try to plan for and

“The nature of population change, including the rate, composition, and nature of population growth can have profound impacts on a geographical area and the people and communities that reside there.

Population change is a fundamental component of any society but the nature of change is often difficult to understand.” accommodate high growth.

Preparing for Growth Idaho benefits from a strong economy experiencing robust growth.

This economic growth is fueling strong growth in the state’s population.

It is essential for our communities to anticipate and prepare for population growth.

Especially for cities and states experiencing high growth, the more they can do to plan for future growth the more it will help when the growth occurs.

Additional economic

insights, including state and national economic trends highlighting indicators such as employment, demographics, housing, and more can be found online at www.zions-

bank.com/economy.

Robert Spendlove is Economic and Public Policy Officer for Zions Bank. To contact Robert, email Robert.Spendlove@zionsbank.com.

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he Greek philosopher, Heraclitus, famously said, “the only constant is change.” This is true in all aspects of life, but it is especially true when considering population growth. The nature of population change, including the rate, composition, and nature of population growth can have profound impacts on a geographical area and the people and communities that reside there. Population change is a fundamental component of any society but the nature of change is often difficult to understand.

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12 May/J un e 2 01 7

Id a ho St ate B us i ness J o urna l

How Trump insurance changes could affect coverage next year

By Tom Murphy AP Health Writer

A

much tighter sign-up deadline and coverage delays will be waiting for some health insurance customers now that President Donald Trump’s administration has finished a plan designed to stabilize shaky insurance markets.

Shoppers will have a shorter time period to choose a 2018 plan and a harder time enrolling outside that window if they lose a job or have some other special circumstance that affects their coverage. Insurers also will have more flexibility to design lower-cost coverage under a set of changes announced in April for the Affordable Care Act’s insurance exchanges.

The exchanges, accessed by customers through the federal HealthCare.gov or staterun sites, were established as a way for people to compare and shop for insurance coverage.

But insurers have raised prices sharply or abandoned markets in many regions, leaving some customers with little choice. Companies are considering leaving more markets for next year because they say they are losing money.

The administration has responded with a series of changes aimed at reducing the number of insurance company defections while it pursues a broader remake of the federal law.

These changes may help convince insurers to return to the market for next year, but they also could make shopping tougher for consumers in a few ways.

Customers will have 45 days to shop for 2018 coverage, starting Nov. 1 and ending Dec. 15. In previous years, they had twice that much time, and could still buy coverage until Jan. 31. The tighter time frame aims to prevent people from gaming the system by waiting until they become sick before signing

”It’s a very delicate subject when you’re dealing with someone’s health and if the plan doesn’t work, you’re stuck with it for the next year. It’s not a five-minute conversation.”

— Dallas-based broker Tanya Boyd up for coverage.

The smaller enrollment window could be tough on some shoppers because they often have to search for an insurance plan that includes their doctor to avoid big medical bills. That’s no quick task when a patient has several doctors, insurers are leaving exchanges, and those that remain have narrow doctor networks. Then shoppers have to figure out whether they can afford the coverage and if any tax credits are available to help.

“It’s a very delicate subject when you’re dealing with someone’s health and if the plan doesn’t work, you’re stuck with it for the next year,” said Dallas-based broker Tanya Boyd.

“It’s not a five-minute conversation.”

The administration also placed curbs on “special enrollment periods” that allow consumers to sign up or change coverage outside the normal enrollment period if they have a big change in their life like a move, divorce or the birth of a child. Insurers say loose enforcement of these periods has been an expensive problem because it also allows people to game the system.

Customers will now have to verify first that they qualify for a special-enrollment period before they can enroll. That could create

coverage delays.

“For some people, the hassle or difficulty in pulling together verification could discourage them from signing up altogether,” said Larry Levitt, a health insurance expert with the Kaiser Family Foundation, which studies health care issues.

The administration also gave insurers more flexibility to design lower-cost coverage that may attract younger and healthier customers, which would help insurers offset the higher cost of insuring older, less healthy people.

That lower-cost coverage could come with a higher deductible, though, which means those customers will need to pay more out of their own pockets for most care before the insurer starts paying.

Whether these changes help convince insurers to stick around for 2018 remains to be seen. They are weighing their options and may soon announce whether they plan to offer coverage for next year. But customers won’t know for sure for months, because insurers can still back out up to a few weeks before the start of the open enrollment period.

Insurers have called the changes — most of which they had requested — a step in the right direction. But a key concern has yet to

be addressed.

Insurers, doctors, hospitals and the business community have asked the Trump administration to preserve “cost-sharing” subsidies that help reduce the impact of high deductibles and copayments for consumers with modest incomes. These are separate from the better-known so-called premium subsidies that most customers receive.

The cost-sharing subsidies, estimated at $7 billion per year, have been challenged in a court case that’s now on hold. Without the payments, experts say, the government marketplaces that provide private insurance for about 12 million people will be overwhelmed by premium increases and insurer departures.

The Trump administration has indicated that the payments will continue as long as the case is being litigated, but insurers want more of an assurance that these subsidies will be available next year.

In a Wall Street Journal interview Trump raised the possibility of shutting off the money if Democrats won’t bargain on health care.

But the president also said he hasn’t made up his mind, and that he doesn’t want people to get hurt.

Most communities will have competing insurers on their public marketplaces next year, but a growing number will be down to one, and some areas may face having none.

Premium increases averaged 25 percent this year for standard plans in states served by HealthCare.gov.

Prices could climb another 10 percent or more next year due to higher medical expenses that affect coverage sold both on and off the public exchanges, according to Dave Dillion of the Society of Actuaries.

AP writer Ricardo Alonso-Zaldivar contributed to this report from Washington, D.C.

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May/J u ne 2 01 7 1 3

Idaho St ate B u s in e ss J ournal

Applying for a Small Business Loan Like a Boss

By Andrea Rosenkrantz Mountain America Credit Union

s While the Small Business Administration (SBA) annually qualifies thousands of loans for small businesses, applying for an SBA loan can still seem daunting. Simply meeting the qualifications for a loan doesn’t always mean you’ll receive one.

According to Forbes.com, seven out of 10 businesses survive at least two years but just 25 percent survive 15 years or more. Financial institutions that offer SBA loans want assurance up front that both the business and its owners are a good risk.

The good news? Financial institutions are on your side.

“Small businesses are the cornerstone of the U.S. economy, and loans often make the difference between getting the capital needed to take the next step and closing the doors,” says Dave Christiansen, assistant vice president of SBA sales at Mountain America Credit Union.

Consider these tips to make the process easier before you apply for your small business loan: Review your credit profile. While some SBA loans are offered to business owners with FICO yscores below 700, most need to be in the high 700 — 800 range. If you notice mistakes on your report, correct them right away and bring the necessary documentation to your financial institution.

Nail down your business plan. For new businesses, be sure your business plan is solid, clear and concise. State what your business is, why you need the money and how you’ll be successful. Financial institutions want to see that you have a plan to facilitate repayment. For existing businesses, providing a two- to three-year financial history is helpful.

Prepare financial projections. Your monthly cash-flow projection is likely required; be prepared with projections 12 to 24 months out. Projections of dprofit and loss (P&L) statements and balance sheets are also beneficial.

Get professional help. Your financial institution can answer questions, help you improve your application, and determine how much money you’ll need to launch or support your company. Note

that the SBA backs approximately 75 percent of the loan, but the financial institution you select is on the hook for the other 25 percent.

Work smarter. Utilize tools you already have at your fingertips. Does your financial institution offer business services — like Health Savings Accounts, cash management options or payroll services? Find out what they provide and put them to work.

Take care of your greatest resource. That’s YOU! Make sure you are exercising, getting enough sleep and eating properly. And take a moment every day to do something outside of work that makes you happy. That could be drinking an uninterrupted cup of coffee in front of a window with an amazing view. Or meditating for five minutes. Or even calling your spouse or kids just to check in and say “I love you”.

Once you’ve secured your small business loan, your work is only just beginning. Here are a few more tips to run your business like a boss: • Manage your cash flow — know what’s coming in and going out.

• Keep impeccable records — it will be easier to spot trends and keep an eye on profit margins and inventory controls.

• Provide stellar customer service — knowing your customer and giving them what they want will keep them coming back.

• Stay on top of laws and industry protocols.

• Be ready for change — it will happen.

• Shop the competition.

• Hire people you trust — you can’t do everything effectively.

• Learn from your mistakes and move on.

• Seek out a mentor — talking through challenges and brainstorms with an experienced, trusted mentor could be the most invaluable resource you have.

• Have fun — do what you love and share the passion!

Mountain America Credit Union is a full-service financial institution committed to putting our members’ needs first. They have branches in Pocatello and Chubbuck. For more information, call 1-800748-4302.

Be aware of health care scams

By Emily Valla BBB Northwest Dealing with health care can be such a headache. Scammers know that, and they hope to get away with your personal information before you realize what’s going on.

Often the fraudster will pose as a government authority to persuade you to provide personal information related to your Medicare or Medicaid account.

If you do it, you are opening yourself up to identity theft. In other cases, the con artist is after your health insurance, Medicaid, or Medicare information to submit fraudulent medical charges.

Health care scams are as varied as just about any con out there. The scam could begin via email, text message, or in most cases, phone calls. Recipients of possible scam calls report to Better Business Bureau’s Scam Tracker that calls are repetitive and pushy in asking for personal information. Red flag!

The scammers work to make it appear that they are from a government agency or are an official of some kind.

They duplicate logos on emails to look official; they spoof phone numbers that show up on caller ID’s.

If you answer the phone or respond to the message, what happens next varies. BBB says in many cases, the “agent” claims he or she needs to update account information in order to send a new medical card.

In another version, the scammer asks for your account number in exchange for free equipment or services. A third version involves a threatening robocall purporting to be from health insurance officials. You’re told you must buy health insurance or face an immediate fine. Sure enough, you’re soon asked to provide personal information.

Be wary any time you get a cold call demanding information. Don’t trust a name or number: con artists use official-sounding names, provide fake ID numbers, and mask their area codes to try to get you to trust them. Don’t fall for it.

Never share personally identifiable information with someone who has contacted you unsolicited, whether it’s over the phone, by email, or on social media. This includes banking and credit card information, your birthdate, Social Security number, and, of course, your health insurance number.

Still unsure? The Idaho Department of Insurance warned about a possible health care scam happening locally last year. In the alert, the Department of Insurance reminded individuals: • Open enrollment for health insurance ran from Nov. 1, 2016 through Jan. 31,2017 — no special “state enrollment period” for individual health insurance exists.

• The federal government will not call you to sell you health insurance. Be wary of telemarketers who often use official-sounding names.

• Never provide bank account or health information or agree to any request to send money over the phone. If you are being pressured to provide this information, hang up.

• Purchase insurance only from a licensed agent. Ask agents for their license number and verify licensure by calling the Idaho Department of Insurance or visiting the website, www.doi. idaho.gov. If a person refuses to provide licensing information, hang up.

• If you receive a sales call from someone selling health insurance, ask the caller to send you information in writing about the policy, including premiums. If they refuse, hang up.

14 May/J u n e 2 01 7

Id a ho St ate B us i ness J o urna l

Say No to Food Waste

S

pring has tentatively arrived, the don’t always know what to do with it, so start of a season of abundance in an impulse purchase may end up spoilsoutheastern Idaho. Gardeners can ing before we get around to eating it. get back into the dirt, and local farmers, Do we really understand what it ranchers, cottage food producers, and armeans to throw away so much food? tisans will soon start offering their wares We should, because the impact of food at the Portneuf Valley Farmers Market, waste is massive. Aside from the human which returns to the Old Town Pavilion labor that goes into producing discarded on May 6. food (some of which never even leaves JANNA As we start planting our gardens and the field), we are using up a lot of natural GRAHAM eyeing the bounty of the Farmers Marresources in vain, with significant effects ket, it is natural to imagine the produceon our land, air, and water. A 2009 study rich meals that await us. Vegetable soups, green by the National Institute of Diabetes and Digessmoothies, and colorful salads will become daily tive and Kidney Diseases found that 25 percent staples for the next several months as we snack of fresh water and 4 percent of oil consumed contentedly between meals on carrots and pepin the U.S. is used to produce discarded food. pers. As most of us realize, however, the reality Moreover, as food decays in landfills, it releases is a little less rosy. Last summer, the Guardian methane, a potent greenhouse gas that may have reported that the U.S. discards about 50 percent long-term effects on environmental health. Most (yes, half) of the produce grown within its bordisturbing, however, is that the amount of edible ders. This amounts to about 60 billion tons per food we throw away could, if properly used, year, the equivalent of $160 billion. The largest effectively deal with hunger in the U.S. Feeding single component of our landfills is food — up America reports that 46 million people access to 21 percent of landfill mass, according to huntheir network each year, and the USDA’s most ger relief organization Feeding America. recent data indicates that 13.1 million children in There are numerous reasons why the U.S. the U.S. lived in food-insecure households that leads the world in the production of food waste. don’t have consistent, reliable access to food. The Idaho Foodbank reports that more than 240,000 The Guardian report points to the American Idahoans are food insecure, including 80,000 obsession with aesthetic perfection — an children. Throwing away so much food when so intolerance (sometimes backed by regulatory standards) of fruits and vegetables that are differ- many of us are hungry requires a twisted logic that we should no longer tolerate. ently shaped, off color, bruised, scratched, or The food waste problem belongs to all of us, otherwise “flawed.” In the U.S., plentiful harvests even though most people underestimate their are the norm, which means that food retailers can afford to reject produce that doesn’t meet ex- contribution to it. We may think that there’s not much more we can personally do to adacting standards. Food producers, not wanting dress the problem. But perhaps this is the seato jeopardize future sales, are often unwilling to son to challenge ourselves to do better. We can protest, even when they know the rejected fruits plan better by consciously considering what and vegetables are just as safe, tasty, and nutrito do with every bit of food that comes into tious as any other. If that produce doesn’t sell, or our homes. We can learn better by seeking out if the producer knows that he or she won’t find unusual cuts of meat — what might otherwise a market for it, it may be dumped or left in the be discarded during butchering — and finding field to rot. In the meantime, consumers who out how to prepare them. We can learn how are accustomed to seeing ideal produce at the supermarket lose the ability to appreciate variety, to use the leafy tops of beets, radishes, turnips, celery, and carrots in stir fries and salads; how so the cycle continues.

There’s more to it, however. Modern technolo- to prepare melon and squash seeds for snacking; how to use scraps to create homemade gies and growing practices, for better or worse, allow us to blur or even obliterate the seasonality vegetable and bone broths; how to preserve excess food for later; and how to compost of most fruits and vegetables. If something is what’s left over. We can share better by asking always available, we aren’t as likely to be careful local markets to start “ugly vegetable” sections, about wasting it. In addition, our modern food with discounts on unusual-looking produce; production and distribution system allows the posting photos of non-uniform produce on average eater to procure the food she or he consumes cheaply and with relatively little effort. social media; finding a good home for extra food; and donating to the Idaho Foodbank or When we aren’t putting in the work hunting, gathering, or growing our own food, we may feel a hunger relief organization. This is the start of the season of abundance, but it is time to stop less invested in using it wisely. Culturally, we’ve also seen a decline in the food preservation skills being careless and stop taking that abundance for granted. that allow us to keep food longer. We do less ferJanna Graham is the Pocatello Co-Op Outmenting, canning, and drying than Americans did decades ago. Even when the food is fresh, we reach Coordinator.

Millions of women worldwide would like to join the workforce

By Julie Ray and Neli Esipova Gallup WASHINGTON, D.C. — Although women make up half of the world’s population, barely half of them today are participating in the workforce. A new report released in April by Gallup and the International Labour Organization shows this is not what most of the world’s women — or men — want. Seventy percent of women worldwide, and a similar 66 percent of men, say they would prefer women to work at paid jobs. These figures are more than double the percentages of those who would prefer women stay home.

These results are just a few of the insights on the world of work from the ILOGallup report, “Towards a better future for women and work: Voices of women and men.” The report represents a collaboration between the ILO and Gallup to provide the first-ever account of how men and women worldwide think and feel about women and work. In 2016, in support of the ILO’s Women at Work Centenary Initiative, Gallup asked nearly 149,000 women and men in 142 countries and territories about their attitudes toward women and the world of work. The questions covered a range of topics, from women’s and men’s preferences for women in the labor market to the top challenges that working women face in their countries and territories.

While the report shows gender equality is still far from being achieved, it also indicates men and women are not always as far apart in their attitudes as people might assume. About three in 10 women worldwide would prefer to work at paid jobs (29 percent), and a similar percentage would prefer to stay home (27 percent).

Four in 10 women would prefer to do both (41 percent). Men want the same for the women in their families: 28 percent would like these women to have paid jobs, 29 percent would like them to stay home and 38 percent would prefer they do both.

In places such as Northern, Southern and Western Europe — where men and women are most likely to favor women working at paid jobs — there is no gender gap on the issue. Nearly nine in 10 women and men in this region say that women should only work at paid jobs or work at paid jobs and care for their families and homes. Gaps are also almost nonexistent or extremely narrow in other regions such as sub-Saharan Africa, Latin America and the Caribbean, Northern America and

Fast facts

n 70 percent of all women, 66 percent of men would prefer that women have paid jobs n 58 percent of women not in the workforce would like to work at paid jobs n 41 percent of women would like to be able to work and care for their families Eastern Asia.

At the same time, the results reveal some real gender divides in several regions that may reflect pressures in cultures where men are traditionally perceived as the chief providers and where women’s workforce participation tends to be low.

For example, a slim majority of men in Northern Africa (51 percent) — the highest percentage worldwide — and nearly half of men in the Arab States (45 percent) would prefer that women stay home. This is at odds with how women in these regions feel: 32 percent of women in Northern Africa and 36 percent of women in Arab States say that women should just stay at home.

The results in Northern Africa and the Arab States, where women’s labor force participation rates are barely above 20 percent, demonstrate that women’s lack of workforce participation doesn’t mean that they want to stay at home. In fact, the majority of women worldwide (58 percent) who are out of the workforce (meaning they were not employed within the past seven days, are not looking for work and/ or are not available to start work) say they would like either to work at paid jobs (22 percent) or to work and care for their homes and families (36 percent).

More importantly, this is true in almost all regions worldwide. This includes several regions such as the Arab States, where women’s labor participation rates are low, and regions where labor participation rates are higher, such as in Northern, Southern and Western Europe.

Among women who are in the workforce, unemployed women, not surprisingly, are the most likely to say they would prefer to only work at paid jobs (41 percent), but nearly as many women who are working full time for an employer (38 percent) say the same. However, women in both groups are most likely to want to both have paid jobs and care for their families and homes.

Retirement Planning Can Jump-start the Ultimate Vacation

M

aybe you’ve heard reports s — may be eating up more of your that Americans spend less savings than you realize. Over the time planning for retirelong run, these fees can really add up, ment than they do planning their so be sure to examine an investment’s next vacation. According to a 2014 fee structure before you decide to buy. retirement survey, 39 percent of • Avoid temptation. Another pitfall the 1,000 retirement savers polled, on the road to a comfortable retirereported spending more than five ment involves debt. Saving as much hours researching vacation options as you can during your working years Jennifer compared to only 11 percent who is great, but a budget shortfall along Landon reported spending that long researchthe way may tempt you to dip into ing investments for their 401(k)s. your retirement accounts — something you It may be human nature — picturing should avoid at all costs. If you’re paying yourself on the beach with a drink in your more in interest on debt than you’re earning hand is a lot more fun than slogging through on your retirement accounts, you’re heading the fine print of those fund prospectuses. But in the wrong direction. Start by avoiding or as Idahoans join the rest of the country in paying off high-interest debt, then set up an preparing for the busy summer travel season, emergency fund so your retirement portfolio now’s a great time to plan what may end up can grow untapped. being the longest vacation you’ll ever take.

• Diversify, diversify, diversify. Ignore this The following five tips will help make your investing mantra at your peril. To protect dreams of a fabulous retirement come true: yourself against devastating losses in the • Pay attention to fees. Overlooking event of a market downturn, make sure you the fees associated with your retirement don’t hold too much of any one type of asset. investments is one of the most common A disproportionate stake in real estate, for retirement-planning mistakes. While it may example, exposes you to risk should there be be impossible to avoid them altogether, fees another credit crisis. Spreading your invest— especially those associated with 401(k) ment portfolio among assets and asset classes

is the best way to insure against a precipitous drop.

• Rebalance regularly. Part of making sure you’re adequately diversified involves a periodic review of your portfolio. If one asset class has had a big run, you may need to sell some holdings in order to bring your portfolio back into balance. The ideal balance will be determined by your time horizon. If you’re five or fewer years away from retirement, you may want to take a more defensive approach and limit your exposure to risk. If you’re at least 10 years away from retirement, you have more time to recover should something go awry. The further away from retirement you are, the greater your flexibility, and you may decide to take a flier on that hot new investment idea.

• Insure against disaster. If you have loved ones depending on you, you really ought to consider life insurance. You’d be wise to make sure your family is provided for in the event something should happen to you. If you already have a policy, take a moment to review it and make sure you’re still happy with the coverage. Perhaps adjustments, such as adding an inflation or long-term care rider, are in order. If there have been changes to

your family, you may need to update your beneficiaries. The peace of mind insurance provides is invaluable, and your beneficiaries will thank you for taking steps to protect them.

Everyone loves a vacation, and planning for one can be half the fun. And the same can be said of planning for retirement. It doesn’t have to be a chore. So, go ahead and pack your bags for that dream getaway, but make sure you also plan for that ultimate vacation.

Jennifer Landon, founder and president of Journey Financial Services, is an accomplished advisor, educator and presenter on financial topics. Landon has spent the last decade advising Idaho Falls residents on the wealth and retirement planning strategies needed to help them achieve peace of mind on their retirement journey. She is an Investment Advisor Representative and a licensed life and health insurance professional in the state of Idaho.

Landon is a member of Ed Slott’s Master Elite IRA Advisor Group, the National Ethics Association (NEA) and the Better Business Bureau. For more information about Jennifer Landon and Journey Financial Services, please call (208) 552-9169 or visit www.JourneyRetirement.com.

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