Kitsap Peninsula Business Journal 25/09

September 2012 Vol. 25 No. 9

The Voice of Kitsap Business since 1988

Page 8

A Choice Combo Two projects by Gig Harbor company picked for Homes of Distinction showcase Page 10

Inside Special Reports: Construction, pp 6-18 People, pg 2 Human Resources, pg 27 Financial, pp 28, 29 Technology, pg 31 Environment, pg 33 Automotive, pp 34, 35 Editorial, pp 36-38 Home Builders Newsletter, pp 19-22 Doug Clark and his son Adam of Choice Construction.

By Tim Kelly, Editor move into their new place until after all Shelly Murphy envisioned lots of those folks have a chance to admire it company coming over when her family — during the Homes of Distinction tour she and her husband, Sean, have four sometime next spring. children and they love to cook and Their patience will be rewarded. Since entertain — moves into a 4,100 square-foot Choice Construction was selected to be the house being built by Choice Construction featured builder for the Seattle-area in Gig Harbor. showcase, the Murphys are in line for some But a couple thousand visitors on three major upgrades to what was already going consecutive weekends? Good thing she to be an upscale house. won't have to cook for all of them.

Actually, the Murphys plan to wait to Choice, page 4

Thinking big — but inside the box

By Tim Kelly, Editor A dream home conjures a host of possibilities depending on who’s doing the dreaming; some may envision a waterfront villa with a boat moored at the dock, others a country estate with stables, or perhaps a luxurious hilltop retreat.

One version of a dream home being designed by a prominent Bainbridge Island architect, however, is much smaller and simpler in scale, though not in ambition.

Matthew Coates, president of Coates Design, already has some impressive projects in his portfolio. He designed the first LEED Platinum-certified house in Washington state outside of Seattle, as well as the Bainbridge Island Museum of Art that’s currently under construction and scheduled to open next summer.

“For an architect, it’s like a dream to get to design an art museum,” he said.

Coates Design, page 4

New business offers natural gas conversions

Chef back in Gig Harbor to run Green.House

A new business called Conversion Technologies specializes in converting vehicles to natural gas (CNG).

Justin Freed, a former mechanic in Port Orchard, is offering analysis for conversion applicability; financing options and incentives; and infrastructure planning and development.

“CNG costs about half as much as gasoline or diesel, is hugely abundant and domestically produced and is cleaner for both the environment and the Justin Freed engine,” according to Freed.

He is ASE F1-certified for alternative fuel installations, and is CSA certified as an Alternative Fuel Systems Inspector. He can help clients understand the often convoluted rules and regulations surrounding this emerging energy source.

He can be reached at justinwfreed@gmail.com or 360-471-4176

Matt Colony has returned to the Gig Harbor area to work as chef and general manager at Green.House Restaurant.

He previously worked as executive chef at the Beach House in Purdy before leaving to open a new restaurant, Pacific Grill in downtown Tacoma, with Gordon Naccarato. Since then he has worked in the San Juan Islands at Friday Harbor House, and helped open Maxwell’s Lounge & Restaurant in Tacoma.

Colony said he is excited by this new

opportunity and his return to Gig Harbor.

He is creating a new seasonally focused menu for the restaurant.

His plans also include expanding the happy hour menu for the lounge and patio.

“Sampling bar food is a great way to discover a restaurant’s menu,” he said.

Other planned promotions include halfprice wine on Tuesday nights this fall, and happy hour pricing offered all day in the bar on Wednesdays and Saturdays.

In the future, Colony plans to have the bar open on Mondays as well, offering “flight school” spirit tastings in conjunction with local and specialty distilleries.

Green.House Restaurant is located in uptown Gig Harbor at 4793 Point Fosdick Drive NW. Suite #400. For reservations, call 253-514-6482.

Creative Office Guru launches new website

2 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

Creative Office Guru, a graphic design company in Kingston, announces the launch of their new website, creativeofficeguru.com, designed by SpiderLily Web Design of Poulsbo. The new site features a sampler slide show on the home page, a categorized portfolio page, and a services page with a YouTube video.

“I’m particularly excited about my portfolio categories,” business owner Shirley Bomgaars said. “Besides the usual logo and poster designs, I have an ‘Out of the Ordinary’ category with samples of unusual design projects.”

Bomgaars said she chose SpiderLily for their ability to create a unique design for her company as well as the ability to easily update her portfolio.

Creative Office Guru can be reached via the website or by phone at 360-981-1838.

Book offers strategies for nonprofit board members Business consultant Doña Keating of Bainbridge Island has published a new book, "How to Avoid the Pitfalls of Nonprofit Hell,” which is available for $14.95 on Doña Keating Amazon.com.

Keating’s book “offers pithy observations and solutions born of decades of service on nonprofit boards and committees, advising them, or facilitating executive retreats,” according to the Amazon summary.

In an email announcing publication of her book, Keating writes, “I chose a straightforward yet cheeky approach because many of us have been there and recognize the way forward.”

She encourages readers to interact with her at http://donakeating.weebly.com/ nonprofit-hell-blog.html.

Port Orchard mayor requires PR training for top city staff

By Tim Kelly, Editor Port Orchard Mayor Tim Matthes is requiring all city department heads and supervisory staff to attend three sessions of public relations training, at a cost of several thousand dollars to the city.

Eventually, the mayor wants all city employees to attend a one-hour training session.

The city is paying $3,000 to a Bremerton financial advisor to provide the public relations training, and it will cost several thousand dollars in overtime — mostly in the police department — to arrange for all city staff to attend.

The city signed a contract with Frank Reed to provide the PR training. His

business — licensed with the state in 2006 under the name Judah Investments and operating online as BottomLine Ministries — specializes in using scripture and biblical principles to help clients get out of debt and achieve financial prosperity, according to Reed’s website.

Matthes apparently received a break from Reed’s usual fees, which his website lists as starting at $5,000 for a seminar or three-hour workshop.

When contacted by the Kitsap Peninsula Business Journal, the mayor refused to answer questions about the PR training. He did not inform City Council members about the training nor ask them to participate, although council approval was not required

Survey that included Bainbridge shows more dollars stay local when spent with independent retailers

supervisory staff, which was Aug. 15. The second session was scheduled for Aug. 29.

On Aug. 20, a few days after the Business Journal submitted a public records request to obtain information about the training and the contract with Reed, the mayor’s office put out a brief news release.

All it said was: “City of Port Orchard department directors, and their supervisory staff, will be undergoing a series of leadership/public relations training over the next several weeks.

“The training will focus on the unity of City Staff and the Mayor’s mission of providing the citizens with services that exceed their expectations and to do it at the lowest cost.”

Decision Makers II North Kitsap at a Crossroads — An Economy in Transition Join us in beautiful Port Gamble for an insightful look at our local and regional economy as we examine North Kitsap’s financial impact, challenges and opportunities. A social hour honoring Leadership Kitsap follows the program.

Meet the newest leadership cohort and enjoy appetizers and beverages while networking with other attendees.

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Date: Thursday, October 4th Time: 3:00 p.m. to 6:00 p.m.

Where: Port Gamble Event Pavillion

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September 2012 Kitsap Peninsula Business Journal • KPBJ.com 3

Bainbridge Island was one of the “Being able to show that three times as communities that participated in a national much of every purchase made with a locally survey of local economics, and the results owned independent business will be show for every dollar spent with locally returned back into our own island owned, independent businesses on economy (versus a chain retailer) is a Bainbridge, three times as much revenue strong argument in favor of spending your recirculates locally when compared with dollars with locally owned island money spent with national chain retailers. businesses.”

The results, announced The Indie Impact Survey recently by the Bainbridge was produced in Island Downtown conjunction with the The study “gives us Association and partners American Booksellers real numbers that Association The Traveler and Eagle (ABA) and underscore the value Civic Harbor Book Co., were Economics, a of supporting our nationally based on confidential recognized survey data collected from local downtown economic analysis and 13 independent, locally development Winslow economic owned businesses engaged planning businesses.” strategic in retail trade in downtown consultancy with offices in — Andrea Mackin, Austin, Texas, and Chicago.

Winslow.

Participants Bainbridge Island were asked about their In all, 10 communities Downtown Association across business practices and the the country distribution of revenue participated in the ABA expended in several categories including: study including local businesses in profits paid out to local owners; wages Chicago (Andersonville and Six paid to local workers; goods and services Corners); Las Vegas, N.M.; Louisville, purchased for internal use as well as Ky.; Pleasanton, Calif.; Raleigh, N.C.; and resale; and charitable giving within the Salt Lake City (North Temple, community.

Sugarhouse, and two other business The resulting statistics, when compared districts). Complete survey results will be with the closest regional, big-box national available on the Bainbridge Island chain retailers, concluded that collectively, Downtown Association website, along the businesses return a total of 39.8 percent with national survey res ults provided by of all revenue to the local Bainbridge Island Civic Economics once all participating economy. By comparison, the numbers of communities’ analyses are complete. the four major national chain retailers For more information, contact the (Home Depot, Barnes & Noble, Office Bainbridge Island Downtown Association Max and Target in Silverdale) recirculate at 206-842-2982, or visit an average of 13.6 percent within their www.bainbridgedowntown.org. local market areas.

“These survey results are very powerful The Bainbridge Island Downtown for us,” Bainbridge Island Downtown Association (BIDA) is committed to building Association Executive Director Andrea and sustaining a vibrant downtown using the Mackin said in a news release announcing Main Street Approach. Since 1998, BIDA the survey results. “The Independent has been an accredited Main Street™ Program Impact Study gives us real numbers that under the National Trust for Historic underscore the value of supporting our Preservation and the Washington Main local downtown Winslow businesses.

Street Program.

for the expenditure of funds in this case.

Reed, who did not respond to phone calls and emails from the Business Journal, was subsequently reached by phone but declined to comment about the training or his qualifications and background. He said any information about the training would have to be provided by the mayor’s office.

There is no information on Reed’s website about his education, training or employment history, other than a vague reference to having worked on construction of aircraft carriers. He told the group at the first PR training session in Port Orchard that he had worked as a pipefitter.

Matthes did not attend the first training session for department heads and

4 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

COATES DESIGN

from page 1 Now he’s designing a structure far less stylish.

But Coates and his partner on the project are nonetheless thinking big about the Ecopak — a container home that one day may be mass-produced and shipped around the globe to help fill a need.

“This is intended to be real affordable housing,” Coates said. The goal is to produce container housing that is efficiently designed, simple to construct, and sturdy.

“It’s designed so that two fairly untrained people can assemble it in a day or two,” Coates said.

Coates is collaborating with James Green, an aircraft structural engineer who came up with the concept and obtained a U.S. patent for it through the company he founded, Building Container LLC. He also has applications pending for international patents.

“He approached me because of our experience doing sustainable design and modular design,” Coates said.

Green, who is British, is an Everett-based contract engineer whose work often takes him overseas; most recently he’s been in Turkey. He met the architect in April 2011 at a Green Exhibition in Seattle, and subsequent discussions over a Guiness at a Seattle pub led to their joint project.

“Matthew has both the marketing and architectural skills to develop the concept further,” Green wrote in an email to the Kitsap Peninsula Business Journal.

Coates said he had turned down previous opportunities to work on container housing projects, because they typically involved just converting a cargo container into a singleroom housing unit.

But Green came up with an innovative approach.

“He was the first one to suggest making (a unit) to include the container within the house,” Coates said.

So all the Ecopak’s structural components will be shipped in a steel container that is then integrated as a room when the house is assembled.

“It essentially becomes the kitchen in the end,” Coates said. It’s also strong enough to serve as a shelter during extreme weather.

Green said he originally came up with the idea as a way to build a house on land he owns overlooking the Mediterranean Sea in a remote part of Turkey, but he faced a crucial challenge.

“There was a preservation order on the land that did not allow for a conventional concrete foundation to be poured but a temporary (removable) building can be erected,” Green explained.

An early prototype was shipped to Turkey, and he has erected the structural frame for the house on the container at three different sites, taking it down and reassembling it to test the model.

“The original prototype was a ‘simple box structure’ for proof of concept, complex architecture can easily be incorporated,” Green wrote.

Coates said another Ecopak prototype kit is being fabricated in Seattle now, and the plan is eventually to manufacture three sizes.

A single story, 400-squ are foot unit would be geared toward use as emergency housing. Such a product, Coates said, could have been a viable alternative to trailers the Federal Emergency Management Agency sent to Louisiana as temporary housing for people displaced by Hurricane Katrina.

A two-story Ecopak unit would be about 825 square feet, and Coates estimated its retail price would be around $70,000.

Adding a third level would increase the living space to about 1,300 square feet without

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much additional cost, so those units would likely sell for less than $80,000.

The smallest units would cost significantly less, Coates said, adding that “it will probably take several rounds of prototypes to get down to what we’re going to mass produce.”

Green said in his email that he envisions “multiple uses for the frame structure, the difference between an economy and luxury house will be in the selection of finishing materials.”

Rendering shows how container becomes part of the house.

It’s still early in the design and Pin Foundations, that is partnering with the development process for the Ecopak, but the Ecopak developers. collaborators see huge potential for Coates said they are in talks with several marketing their product. nonprofits — including a “significant” one in “There’s certainly a market both Belfair — about building some prototype domestically and internationally for Ecopak homes for the groups to use in their affordable housing that is well designed and charitable work. long-lasting,” Coates said.

“I would like to provide the houses for An online CNN article about the Ecopak disaster relief and charities,” Green said. “I drew “tons of hits on our website from all am a practicing Engineer and I would very over the world,” Coates said. Interest was much like to use my skills to help improve especially high from Australia, where a the living standard of people less fortunate woman expressed interest in buying 40 of than myself.” the units to make a hotel.

All in all, it’s an appealing endeavor for The container house is well suited for use Coates, whose firm is founded on “doing in remote locations. responsible architecture.”

“You can pretty much put it anywhere,” He said working on the Ecopak is “a pet Coates said. “It doesn’t require a traditional project; it’s a long-term investment. trench footing and foundation.”

“Whether it has any financial return Instead, the structure will be support ed remains to be seen. But there is a need for by special concrete piers designed and this type of housing.” manufactured by a Gig Harbor company,

CHOICE

from page 1 For Doug and Adam Clark, the father and son who operate Choice Construction, this is a unique opportunity that any builder would love to have, bringing high-profile exposure for one of their best projects. For the Clarks, it's actually two; a second home they have in the works — on the east side of the Seattle area at Lake Sammamish — will share the Homes of Distinction spotlight.

"For us it's just fortuitous, it's just great," Doug Clark said during a recent interview at his company's Gig Harbor office.

TL Concepts, based in Leawood, Kan., has been staging Homes of Distinction tours in cities throughout the U.S. since 2003, and this is the third one in the Seattle area. The marketing company partners with a local TV station — this time it's KOMO — to co-sponsor and promote the event, which typically features one custom home and donates money from ticket sales for the

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tour to a designated charity.

The company decided to double down with Choice Construction so this tour will attract people on opposite sides of the Seattle metro area, as well as feature two strikingly different house designs.

"We're doing two homes that are very different from each other," Adam Clark said.

"One is a traditional Mediterranean style, and one is very modern and contemporary."

The latter is for the Murphys, and it's the second home Choice Construction has built for the family. Shelly Murphy said her parents were so impressed with the first one — a 5,200 square-foot home they sold a couple years ago — that they contracted with Choice to build a home in the Dash Point area in Tacoma.

The co-CEOs of TL Concepts, Tamra Trickey and her husba nd, John Walden, said Choice Construction is the kind of operation they look for in their marketing Choice, page 5

Deadline to reserve advertising space

Sept. 14th For more information: Dee Coppola 800-733-7990 or email dee@wetapple.com

CHOICE

Rendering of Gig Harbor house to be featured in Homes of Distinction.

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 5

from page 4 approach.

"Our project works best with a builder who has a business background, and is creative," Trickey said. "They have that creative aspect to make the house stand out and be a little different, be something that people want to come and see."

"We try to hone in on who is progressive and is doing something that's really 21stcentury construction, on the cutting edge," Walden added. "We thought that with the different styles the guys are going to be building, it would make a really interesting project."

It's going to be especially interesting for Choice Construction and their clients, because with the exposure the Homes of Distinction will get through KOMO-TV ads highlighting all the contributing subcontractors and vendors, plus an anticipated 2,000 people coming through on each of the three weekends the tour runs, there are plenty of businesses wanting to be part of the projects. That even extends to luxury car dealers that want to stage their vehicles in the driveway during the tour.

In the case of the Murphys, whose 8-acre home site is on a bluff overlooking Henderson Bay, vendors are vying to supply everything from deluxe windows, t o a Teppanyaki grill for the kitchen that will be a focal point of their home, to an outdoor TV for the deck and artificial turf for a rooftop patio connected to the master suite.

"We had been trying to stick closely to our budget," Shelly Murphy said recently.

Now, they're discussing landscape architecture ideas with Kim Rooney, a Seattle garden designer whose portfolio includes a project for the 2008 Olympics in China.

They were scheduled to meet last week with Michael Silver, whose California firm Audio High has done sound systems for the likes of Francis Ford Coppola. Murphy said Silver wants to install a state-of-the-art home automation system — think of, say, using a smartphone to raise or lower window shades — along with "a media room so far beyond anything we could have dreamed of."

She said when the y found out earlier this summer about the opportunity to have their house featured in Homes of Distinction, "we could hardly wrap our heads around it."

"It's pretty exciting," she added. "It's 100 percent mind-blowing."

Walden said that for the first several years, including the prior Seattle projects in 2005 and 2007, TL Concepts featured builders doing spec houses rather than custom homes that owners were designing.

But now the company's focus has shifted as the housing industry was impacted by the recession.

"When we started this company, we could make a phone call to almost any market we wanted and find a builder doing a 7-figure spec house," he said. "There weren’t any spec houses being built in 2009 and 2010, and that's when we really started getting homeowners involved."

Doug Clark said it will take longer than originally planned to complete the two homes, due to the time it will take to select which vendors to use and coordinate the

construction schedule with the promotional campaign. The Homes of Distinction tour likely will be in late spring of next year, he said.

The Clarks acknowledge feeling some pressure to meet the high expectations this project creates, but Doug emphasized that it's a chance for a ll the businesses that are part of it to display their work and products to a legion of potential new customers.

"I think it's an opportunity for our whole area. It's going to bring a lot of traffic in, and bring a lot of attention," he said.

“We have a lot of work to do now that they’ve picked us,” Clark added. “But I think it will represent our community well, and represent our vendors well.”

Armstrong Homes marks 60th anniversary

6 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

By Rodika Tollefson Like all builders, Armstrong Homes has been impacted by the recession but the company continues to maintain an edge — by offering a unique method called panelization for building custom homes.

Components such as trusses are manufactured from wood at the company’s plant, located in Auburn, and then assembled on site using a crane. The system cuts framing time by 30 to 50 percent and saves significantly on labor costs and construction timeline — for example, homes could be framed in as little as a day with one-third of the usual crew size, according to Armstrong Homes.

The family-run business has three locations, including one in Bremerton managed by John Armstrong. The nephew of founder Richard Armstrong Sr., John Armstrong has been working in the business for more than 40 years.

He says he has seen seven up-and-down cycles in his career but feels the current downturn market is much deeper even than the one in the ’80s, when inflation rates

were rampant and interest rates were in the double digits.

“It is more competitive today than it’s ever been in my career and business is harder to come by. I feel fortunate we’ve been in business since 1952,” he said.

The Armstrong Homes (www.armstrong-homes.com) niche is in the custom home market, but the company has had to adjust to the lack of construction financing by putting a stronger emphasis on its remodeling services. “We did remodels before but this is where the market has been (in the last few years),” Armstrong said.

“The kitchen is usually the focal point of the remodel, even as growing families want more room for other areas.”

The panelization process has seen increased interest with the growth in green construction. Buyers are still looking for solar, energy efficiency and other environmentally friendly features, and panelization works hand in hand with the green trend, Armstrongsaid.

One of the reasons is the elimination of waste that is inherent with building

materials during construction. Another benefit is reduced mold possibility because the walls are pre-assembled in a controlled environment.

“It’s a very environmentally friendly way to build,” Armstrong said. “A lot of the demand we get is because of that technique.”

In addition to the plant for premanufactured walls and other building components, the business has its own millwork and door shop where products such as doors, trim and cabinets are manufactured. And there’s an option for DIY homeowners: The sister company, Armstrong Building Components, works with owners who want to be their own contractors, providing them with contractor pricing, design support and assistance in finding qualified subcontractors.

Locally, Armstrong Homes has established a reputation for its unique, high-quality custom homes that have won various awards. The most recent was a Builders Best Award from the Home Builders Association of Kitsap County for a custom home in the $300,000-$499,000 category. The Bremerton office serves a customer base that stretches across four counties, into the Olympic Peninsula, Mason County and Gig Harbor. Armstrong is well known around the community for his many civic commitments, including the East Bremerton Rotary and the HBA (he’s past president of both).

The Bremerton office had to downsize, as did the other locations, which have been consolidated from four to three. But Armstrong says things are turning around.

“I see a renewed effort to do new construction. I feel new construction is coming back in 2012,” he said. “There’s a huge want out there and I see more demand. But there’s still a question for the folks who need the full financing.

Banks are being very conservative and the appraisals are not at the levels they need to be.”

The cuts have led

Armstrong to being more hands-on with clients and wear more hats. While that does put more pressure on his time, one thing has worked out well for him personally: “I am more involved with every client … and that’s what I love to do so it was easy for me to pick up that role,” he said. “That’s where I started 42 years ago.”

And after these 42 years, Armstrong says he still enjoys the interaction with customers the most. “The thing that moves me more than anything else is the people, the relationships with the people I work for,” he said.

Armstrong is part of the second generation in the family running the business, and now the third generation is becoming involved. As the company continues to focus on its custom homes niche, he says he would love to see things improve for this new generation.

“My personal goal would be to see this new generation come into a stable environment,” he says, “so they can see how wonderful this industry is.”

John Armstrong

Construction industry evolves with the market — Q&A with Randy Biegenwald

By Rodika Tollefson Randy Biegenwald has been a CPA for more than 28 years and has owned his firm in Old Town Silverdale since 1985. A member for 12 years of Home Builders Association of Kitsap, Biegenwald currently serves on the board of directors. The construction industry comprises a large part of his client base.

Biegenwald has a long record of community involvement, including with the Central Kitsap School District finance committee, Poulsbo PTA (treasurer), the Kitsap unit of American Cancer Society (treasurer), Citizens Advisory Committee to the Central Kitsap Sub-Area of the County Comprehensive Plan Update, and the Silverdale Dandy Lions Club (past president).

The Kitsap Peninsula Business Journal sat down with Biegenwald to talk about his perspective on current trends in the construction industry.

KPBJ: What major challenges have you seen the construction industry go through in the past few years?

Biegenwald: Obviously the recession is the big one. The state energy code has also been a challenge, along with the new storm water codes — and then, there is the problem with funding construction. The lenders seem to be more interested in existing homeowners than speculative homes. All these things have increased the cost of construction in a suppressed market,

and the builders are caught in a squeeze. It’s hard to build because of the depressed market and the costs of construction.

KPBJ: From your experience working with construction clients, what have you observed as far as evolution of the industry?

Biegenwald: One area is spec construction. Most construction for small builders was in speculative homes — they built a house and then sold it, and most of it was funded with bank money. The banks now aren’t lending (for spec) and if they are, it’s difficult to do it because profit margins are razor-thin.

What’s being built now is funded by private money and private funding is hard to come by. A lot of builders that used to build a significant number of speculative homes aren’t doing them so they focus on custom homes, but those jobs are hard to find. A lot of them are doing remodeling and repairs instead of building new homes.

KPBJ: How are the builders adjusting to the market?

Biegenwald: They’ve largely downsized. There’s also been a big move toward green construction for a number of years so education has been an issue. You see more builders with special certifications. When the economy was stronger, it did give them an edge. The Energy Star program is another benefit of it because if a project is Energy Star rated, it would be more attractive to buyers.

KPBJ: Are there any cost-savings suggestions you’ve passed on to construction clients that could be applied to other businesses?

Biegenwald: It’s difficult to tell someone where to cut costs because an efficiently run business was already running lean, so often the only thing you can do is downsize.

KPBJ: Are you seeing a lot of downsizing in the industry?

Biegenwald: Yes. With the drastic decline in the market, if builders don’t downsize, they won’t survive, generally speaking. That usually means fewer employees.

KPBJ: What’s the ripple effect of that?

Biegenwald: It causes employment to decline and obviously that has a negative effect on the local economy. Fewer people have jobs, fewer people can buy houses, or even rent, for that matter. A lot of people are moving in with parents or other relatives to cut living expenses until their situation improves.

KPBJ: Does it feel like things are on the rebound, and if so, what specific factors lead you to believe that?

Biegenwald: I’ve seen some retail businesses’ revenues and bottom line improve; businesses that cut expenses to survive are coming back more profitable because they’ve managed to keep overhead down. It’s good news for business income but not for employment. To create jobs, you have to invest capital and to invest capital, you need capital. Ultimately, we need to grow our way out of (the recession).

Given the opportunity, people will (go out and) generate economic activity, and the best thing the government can do is create the best environment for them to do that. …I’m not saying there shouldn’t be regulation, but the government needs to consider the economic impacts.

I’m starting to see small increases in construction activity — it’s getting better, not worse. The shadow inventory notwithstanding, the number of months of available inventory is back down to more normal levels. The housing inventory is not as high as it was a couple of years ago.

KPBJ: Do you think these changes are sustainable?

Biegenwald: Without a dramatic decline in the European economy, the positive trend should continue. Like the rest of the U.S. economy, the housing industry is in a slow, long-term recovery.

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Surface beauty: That’s what Creative Countertops is all about

By Tim Kelly, Editor Bill Wyman is into smooth.

He delights in showing a visitor to his Creative Countertops showroom a Corian surface so smooth that seams between joined sections are indiscernible, making a countertop with a coved backsplash or built-in sink seem of a piece.

He’ll have you rub your fingertips over a polished square of quartz while he explains that it’s an excellent choice for kitchen counters because it never has to be sealed to prevent stains.

“Quartz is kind of the new, cool thing today,” he says. “It’s just really caught on in the last five or 10 years.”

And then there’s granite — the natural stone option that’s strong, durable and elegant. The price of granite has come down, Wyman says, and there’s also a wider range of colors than used to be available.

“I started out doing only Corian, but I had to get into granite,” he says. “If I hadn’t done that, I’d probably be out of business.”

But his business has grown steadily since he started in his garage nine years ago, and he was invited last year to visit a granite quarry and factory in Vitoria, Brazil, by the Cosentino company, a major international manufacturer of ornamental stone and the third-largest stone importer to the U.S. Wyman also attended an international stone trade show on the trip, and sent home a sizable souvenir to his Poulsbo business

— 42 granite slabs that he says “took three months to get here and was sold out in another three months.”

(For smoothing the edges on all the granite slabs installed in hundreds of kitchens a year, the 3,600-square-foot workshop next to the Creative Countertops showroom recently got a new machine from Italy, which is where much of the best granite comes from. The vertical edge polisher is a lot smaller than a 20-foot horizontal edger in the shop but Wyman says it will save time, completing profile polishing on a slab’s 10-foot edge in about four minutes.)

Wyman was a charter member in the Olympic Chapter of the National Kitchen & Bath Association, and was elected in 2010 to the NKBA’s new Advisory Council of Fabricators. The seven-member group chose him as its representative on the NKBA board of directors for a three-year term that runs through the end of next year.

That role includes attending the annual Kitchen & Bath Industry Show, last year in Las Vegas, this year in Chicago and next April in New Orleans. But Wyman has more time for travel since his days of skilled labor mostly have given way to managing his business and bidding jobs.

The biggest share of those jobs are residential remodeling, and Wyman takes an approach that minimizes disruption in a customer’s kitchen or bathroom.

Bill Wyman stands among granite slabs in the "bone yard" at Creative Countertops in Poulsbo.

“We make our template of what we need to build over the existing countertops,” he says. Then the finished product is brought from the workshop, and the old countertops are removed and new ones installed the same day.

Also, their customers are charged only for the material needed for the project. So when enough leftover pieces of granite and quartz pile up, they have a remnant sale. Lots of partial slabs were stacked on carts outside the showroom for a blowout sale in August.

(In addition to residential work, Wyman says lately they’ve also been lining up more commercial jobs — at local banks and a senior housing complex; new barracks at

8 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

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They also built countertops that were shipped to a dozen Nordstrom’s stores, and recently picked up an account with three Lowe’s stores in Kitsap County to supply LG brand quartz products.)

Wyman, who started in the trade nearly 20 years ago in North Carolina before moving to Kitsap in 2001, established his business here by developing relationships with area builders. Even when the construction trades got hammered during the recession, his small business managed to keep growing.

“We’ve grown almost every year,” says Wyman, who has 11 full-time employees, for whom he pays the full cost of health insurance.

He acknowledges that he’s been fortunate in weathering the last few years better than a lot of people he’s known.

Before the economy tanked, “we used to get a lot of big builders come in, doing brand-new construction or big, major remodels,” he recalls.

When the housing market collapsed, a lot of people who might have considered buying new homes changed their focus to enhancing the houses they had. That helped keep up demand for the remodeling work Creative Countertops does. (“We’ve got a good reputation,” Wyman says, “and I’ve got a really good crew. Most of my crew has 10 to 15 years experience, and that’s very important.”)

Quartz, granite and Corian are the three primary types of countertops they make.

Corian is a versatile synthetic product that combines acrylic and natural materials, and its nonporous surface makes it easy to keep clean and sanitary.

The business also started carrying tile a few years ago, though they don’t install it.

Some of the trendy products are recycled glass tile and Eco tile that’s made Creative, page 11

Robison Plumbing finds success in the art of customer service fully licensed plumbers, five of whom have been with Robison for more than 10 years (as have three of the dispatchers).

While at the core, the plumbing business hasn’t changed, the technicians do have to keep up with all the advances in technology, such as new tankless water heaters and other systems. “Some of those are very complicated,” Short said, adding that they frequently have in-house training as well as workshops by outside experts.

While Robison seems to have its service model perfected, the company continues to look for ways to improve. As one example, all the service trucks were recently repainted with a new design “to keep fresh and looking good,” as Short put it.

“We think it’s really important to look

good when we get to the customers.

First impressions count,” he said.

One of the secrets to the company’s success, according to Short, is finding the right plumbers.

Not an easy task, considering just being skilled at the trade is not enough to get a job with Robison Plumbing.

“Lots of people are plumbers but not very many are service plumbers. They have to be a people person and love their jobs, because it shows to the customers,” he said.

“You have to have the right personality.”

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 9

By Rodika Tollefson When a Robison Plumbing service technician shows up at a customer’s door, he can be easily identified by the clean, crisp white shirt the company requires plumbers to wear (along with booties over footwear).

He will diagnose the problem and give an estimate on the spot for the entire job, regardless of how long the repair takes.

Before he leaves, more likely than not he would have fixed the issue without having to drive off to find parts, because the large truck he drives is stocked every day with every plumbing fixture imaginable. But before he is finished, the plumber has one more piece of business: He has to clean up the area (attempting to leave it better looking than prior to the job).

This service model, according to company vice president Jim Short, is one of the reasons about 70 percent of business comes from repeat clients. He has it on good authority, too: Every job is followed up by a call from the office asking specific questions about the visit.

“We follow each job with a call to ensure the customer is happy and if something is wrong, we fix it right away,” Short said.

Short said customers especially comment on the fast service, but it’s more than that. “We keep them happy year after year because we treat them right. Most plumbers are in the plumbing business; we’re in the customer service business.”

Robison Plumbing (www.robisonplumbing.com) was founded in 1986 by Russ Robison, who is now halfpartner with Short and serves as president.

Originally, the focus was on new construction, but as more calls came in about repairs, the company branched off into two, with Robison Plumbing created to serve the maintenance and repairs market, both for residential and commercial clients.

The commercial base comprises about a third of the business and clients range from retail stores and restaurants to medical offices and hotels.

One aspect that makes the company different, according to Short, is the 24/7 availability without the corresponding price. Robison Plumbing is available nights and weekends, but doesn’t charge a premium for after-hours service. The plumbers are not just on call, either — they are on shift at the Bremerton headquarters, waiting for calls, as is an in-house dispatcher. He says that even after a lot of promoting of this aspect over the years, people don’t take full advantage of it, and it’s an area where Robison can easily do more.

The company has not been impacted as much as plumbers who cater to new construction, but Short says Robison Plumbing is not recession-proof. Although the number of calls per year has stayed steady at about 7,500, what has decreased is the average dollar amount for each job.

“People are only fixing what they have to. People are broke, and it’s not getting any better,” said Short, who has been a partner in the business since 1999.

The company currently employs 11

Ritzman Construction: A second-generation family affair

By Rodika Tollefson Mike Ritzman got an early start in the construction business. He was 13 when he started working for his father, Glen, who founded Ritzman Construction in 1967.

As the the second-generation owner of the business since 1996 with his wife, Cheryl, Ritzman says he’s carried on many of his father’s old-fashioned traditions and values.

“A lot of the old ways are still in place but we’ve implemented new things,” says Cheryl, who has worked in the business full-time since 2001, managing the office.

One of the new things is a modernized scheduling system, an online program that gives customers easy access. Streamlining the business using technology played to Cheryl’s strengths — she studied computer operations in college and her previous fulltime job for the city of Bremerton involved accounting and contract management, among other things.

For Ritzman, on the other hand, the hands-on construction work has always been a draw. Although he briefly took a detour from the industry — going to college for a year before realizing it wasn’t for him — he found he was good at building.

“It’s fun to build houses. I’m not pushing paper, I’m producing a product,” he said.

“People enjoy (the homes) and that has a good feeling. You feel good when customers are happy.”

The couple, who are both South Kitsap High School grads, have built several award-winning homes but they give the credit to their customers. “We build for the customer exactly what the customer wants,” Ritzman said. “We build cool homes but our customers make the choices and we just do a really good job.”

Although Glen Ritzman started out by building a speculative home, the business has evolved since then to focus on custom home construction and a specialty in difficult sites and waterfront homes.

“We tend to work for people who want to be in their house for a while,” Ritzman said. “A lot of our customers have been around (the area) for a long time and want a quality home.”

The last three years, Ritzman has made a shift to remodels and repairs, like most builders. The more popular projects are full-kitchen remodels and bathrooms, but they’ve seen several whole-house remodels in the past couple of years as

Mike Ritzman well, and have also done commercial tenant improvements.

With the business headquartered in an office on their property and the two often working side by side, the pair say that the

business could become their life — especially now that their son is working for them fulltime. But they try to keep their family life separate.

“There’s a point where you have to be able to shut it off,” Cheryl said, adding that having a physically separated office helps with that switch.

The Ritzmans love working together and using their combined talents to provide for a family income.

They admit that the downturn has brought a change in their philosophy on life, but don’t see that as a bad change. “We realized we are happy where we are at,” Cheryl said. “We really looked at whether we should close the business and we didn’t want to do that.”

Besides, they would miss their customers too much.

“We love our customers,” Cheryl said.

“You become part of them, in a way, for that time.”

10 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

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Highmark Homes busy building for first-time buyers in Kitsap

By Tim Kelly, Editor September should see a construction revival of affordable housing in Bremerton’s East Park neighborhood, and if Highmark Homes completes its four-year plan, it will be one of the largest residential developments built in the city.

A total of 437 houses could go in on the 50-acre site where the original developer, Lyle Homes of Bellevue, built about a dozen houses several years ago on Schley Boulevard before defaulting on the property during the recession.

“If the market continues to improve, we’re hoping to wrap it up by 2016,” said Tom Tollen, CEO of Tukwila-based Highmark Homes. “Our sales rates are very high in Kitsap County. I’m a pretty strong believer in this market right now.”

The East Park development will offer two home models, both around 2,000 square feet and priced under $200,000 to appeal to first-time homebuyers while mortgage interest rates remain low.

“For 1,900 square feet your payment’s around $1,100 to $1,200 a month, which is less than rent,” Tollen said.

He said he expects permits will be issued to start building the first seven or eight homes in the 50-unit first phase in September. The Windermere real estate office that Tollen owns in Pierce County began marketing the homes in August, and three were sold in the first few weeks.

Highmark, which Tollen said is on track to exceed $20 million in gross sales this year, is building homes in several other Kitsap County developments.

Vintage Hills, not far from East Park, is another project that was partially built out before the developer went bust and the property was taken over by the FDIC. “We purchased it from a third party with foundations already in ground,” Tollen said.

“It’s a nice community, right on the water.”

Homes built on 20 sites there will be priced in the low 200s.

Highmark also is building homes in Canyon Estates in Bremerton, Avondale Glen in Poulsbo and Blackjack Terrace in Port Orchard.

“All these were bank-owned projects,” Tollman said. “Land prices have dropped so significantly, the opportunities were tremendous. We purchased what we can and are capitalizing on a good market for first-time buyers.”

Highmark is one of the first private companies to buy a stake (12 lots) in the

Bay Vista project being developed by the Bremerton Housing Authority off Kitsap Way just east of State Route 3.

Highmark, which builds homes in King, Snohomish and Pierce counties, got started in Kitsap in 2006 when the company bought a 90-lot plat that would become the Madeline Woods development in Bremerton.

“We were just developers at that point, putting roads, utilities and sewers in,” Tollman said.

But he said when builders working on houses there got sunk by the recession,

Highmark took over construction in 2007 and built out the development, even though it was unprofitable for the company at the time. They have since sold all the homes built there.

Now, Highmark has a substantial base of subcontractors and is poised to build hundreds of homes in Kitsap County in the next few years.

“We were forced to become a builder because of the market change,” he said. “I had no desire to be a builder until we really had no other choice.”

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CREATIVE

from page 8 of 75 percent recycled materials. Wyman says the recycled glass is now manufactured in quartz-based tile, which is superior to previous products that were concretebased.

“There’s all kinds of really cool new glass tiles for backsplashes,” he says. “The glass and porcelain tile is really taking off.”

And the newest innovation is imprinting high-definition images of natural stone on porcelain tile before it’s fired.

“That’s coming, the next generation of countertops will have that,” Wyman says.

“It might be here next year.”

The business owner who was “a handson fabricator for 15 years” still puts his hands to creative use. Wyman — who’s a guitarist in two local bands in his leisure time and says he originally wanted to be a furniture maker — recently bought some massive timbers from an old barn that was torn down. He cut pieces of the wood to make a kitchen island with a granite top, which he displayed at a recent home show.

WRK Construction creates niche in residential remodeling

12 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

By Rodika Tollefson Wayne Keffer’s entire career has been related to construction and he loves working with his hands and problemsolving. But it took him nearly 20 years of working for others to be ready to follow his dream and launch Wayne R. Keffer Construction (aka WRK Construction).

Not rushing into owning a business turned out to be a good move. Keffer, in a way, is a product of the local building industry, as he learned various aspects from each employer. He notes that every single one was a member of the Home Builders Association of Kitsap County, an organization he serves currently as president.

“A lot of guys start when they’re young and really don’t know a lot,” said Keffer, who graduated from Central Kitsap High School. “My track was different. I worked for others and progressed through the jobs, and I was fortunate I had some people along the way that helped teach me.”

When he finally made the leap in 2004, the market was booming. But Keffer once again did not go with the flow.

“I decided to focus on remodeling and started branding instead of focusing on the upswing and making gobs of money,” he

Wayne Keffer said. “I wanted to create brand recognition and build clientele.”

A few years later, it turned out to be a good move. When the new homes market came to a halt, WRK Construction (wrkco.com) had already established itself as a remodeler, Keffer said. That doesn’t mean the company, which employs three to four people, didn’t feel the squeeze — as more builders had to emphasize remodels and customers expected lower bids, the market has made it more challenging for

everyone to compete and make a big enough markup to be profitable and stay in business.

“We have to be very conscientious of price and be competitive whether it’s a new client or referral, or an existing customer,” he said.

Like many builders, Keffer has noticed an uptick — his jobs have become larger this year compared with two years ago. But he tries not to focus on trends. “I don’t analyze it. I’m just a guy that likes what he does and tries to do a good job,” he said.

His long-term goal is to grow WRK Construction to a point where less of his time is needed so he could be free to pursue other things that are important to him, including family and involvement in an organization dear to his heart, the Royal Family KIDS. Helping foster children through this organization has been a passion for the entire Keffer family and among the things that are “quite honestly, more important than remodeling or building houses,” he said.

Keffer feels the success of his company is both about the tangible — doing good

work — and things you can’t hold in your hand, like honesty, trust and good service.

Internally, it’s about running a lean company (he has limited office staff and the business is headquartered on his property).

He also credits the local and other HBAs, which have given him various opportunities including educational possibilities leading to certifications such as CAPS (certified aging-in-place specialist) and CGR (certified graduate remodeler).

But there’s one more ingredient in that formula.

“I love the construction industry. I’ve always loved it,” he said. “I do not wake up any morning when I don’t want to go to work. That’s probably part of the secret to my success — I love what I do and see it as valuable and important; and it provides a good income for my family.”

Family — his wife, Tammi, and their children — is another aspect Keffer gives credit to, along with his faith.

“Their encouragement allows me to put the extra hours into the business,” he said.

“It’s because of Tammi’s graciousness that I’m able to do this. I owe a lot to her. God’s blessed us, too. …I don’t believe you do this on your own.”

Sun Path owner views housing industry changes realistically

By Tim Kelly, Editor For a guy whose business has been greatly diminished during the housing industry’s decline the past several years, Walter Galitzki takes a remarkably philosophical view of things.

“It’s probably never again going to be like it was five years ago,” the owner of Sun Path Custom Construction said, referring to the housing boom that preceded the recession. “It probably never was (like that before) in history.

“There’s been a fairly substantial shift in what housing looks like.”

efficiency.

Sun Path’s office is by Mission Lake, north of the Bremerton airport and Belfair, and over the years Galitzki’s business has built homes throughout the region, in Kitsap County as well as the North Mason and Hood Canal areas. The last new house he built was in Southworth, a contemporary-style home with in-floor heat and floor-to-ceiling windows.

“I miss both not building houses, and I also miss a more vibrant marketplace and the income opportunity,” Galitzki said, reflecting on the drastic changes of the past

few years.

The one-time boatyard worker who has a teaching certificate and once worked in a youth counseling center before beginning his construction career is 65 now.

He plans to continue working, though he’s selective in the remodeling jobs he takes on, preferring to work with homeowners on projects that involve “interesting, creative spaces” and incorporate energy-efficiency measures.

“I find it very rewarding, so I’m going to stick in for awhile,” he said. “It kind of depends on the economy.”

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 13

Walter Galitzki Galitzki has operated his company for more than 30 years, but in the last five his staff has shrunk from 17 employees to four.

Sun Path hasn’t built any new homes in that time, and he candidly acknowledges that his business is “just hanging on; we’re barely keeping the lights on.”

New construction used to account for about 40 percent of his business, he said, but now all his jobs are remodeling.

As an active member of the Home Builders Association of Kitsap County, he knows full well the toll the economic downturn has taken, as HBA lost members who were builders, subcontractors and suppliers.

“For the last five years I’ve been hearing a lot of people say it’s going to get better,” Galitzki said, but he notes there are also warnings that the fragile recovery could falter and a double-dip recession might be on the horizon.

He’s not pessimistic despite his company’s struggles; he’s a realist who cites economics and demographics as factors reshaping the housing industry’s future.

The recession may have been officially over for awhile, but many families and businesses are still enduring tough times.

Because of that, “I don’t think the income of people is going to support bigger, more costly homes,” Galitzki said.

He sees the related influence of shifting demographics in “a move toward more sustainability, more multi-use space within homes, and more energy-efficient structures.”

One significant group is people moving into retirement and looking to downsize to smaller homes that require less maintenance. At the other end of the

spectrum, Galitzki notes growing interest among younger people in urban living.

“You see these high-density urban infill projects,” he said. “There are several of them in Winslow (on Bainbridge Island), for instance.”

Galitzki has long been a proponent of green and sustainable building. He’s chairman of HBA’s Built Green committee, which he was instrumental in creating about 15 years ago. Last year he supervised the energy retrofit at HBA’s Bremerton office, which the organization touts as a leading example of improved energy

How to find low-down commercial construction financing

By Kerry Keely, Kitsap Bank When considering new commercial construction financing or extensive additions and renovations to commercial structures, the benefits of the U.S. Small Business Administration (SBA) 504 loan program should not be overlooked. Here’s how it works:

SBA-504 Loan If buying or constructing your own building is desirable, one of the SBA’s flagship programs, called the SBA-504 loan, can help you achieve your goal. Kitsap Bank has been assisting clients with obtaining SBA 504 loans since the inception of the program. The loans are designed to help

small businesses buy, construct or improve commercial and industrial buildings, as well as buy and install heavy machinery and equipment.

The advantages of a SBA-504 loan are that it offers: • A long-term, fixed rate — loans have a 20-year fixed rate term on real estate and a 10-year fixed rate term for equipment.

• Low interest rates — the effective rate for the 20-year debenture funding was 4.45 percent in August.

• The low down payment retains capital in the business. Conventional bank loans require a 20 percent to 25 percent down payment or more. The SBA-504 Loan has a minimum down payment of 10 percent — allowing a business to retain the additional 10 percent to 15 percent of conventional down payment requirements for working capital. (The down payment is 5 percent more for start-up businesses and special-purpose properties).

• There are no balloon payments on the 504 loan.

• The 504 loan is government-

guaranteed. Therefore, the collateral required is normally just the property being constructed or purchased; no additional collateral is needed.

• Most closing costs such as appraisal fee, environmental fees, loan and contingency fees can be included in the financing.

• Projected income consideration — projected income of a business can be considered in addition to historical cash flows. This is particularly advantageous for growing businesses expanding into larger facilities.

Structure of loan The SBA-504 loan has three participants: • A lender such as Kitsap Bank provides a first trust deed loan for at least 50 percent of the total project cost.

• A 504 CDC provides an SBAguaranteed 504 loan for up to 40 percent of the total project cost, or a maximum of $5 million ($5.5 million for manufacturing businesses and “green” buildings).

• The small business owner contributes a down payment of at least 10 percent (15 percent for start-up businesses or

special-purpose properties).

To qualify, the business must: • Be organized for-profit.

• Be organized as a sole proprietorship, corporation, partnership or limitedliability company (LLC).

• Have a tangible net worth no greater than $15 million and average net profits after tax less than $5 million in the last two fiscal years.

Owner-occupancy requirements • 51 percent owner-occupancy is required within one year of closing for existing buildings.

• 60 percent owner-occupancy is required upon completion of construction for new construction (and there must be intent to increase to 80 percent owneroccupancy by the 10th loan anniversary).

So, whether you are considering a ground-up construction project or the expansion of an existing facility for owneroccupied business use, you should definitely explore the benefits of using this SBA loan program. It helps a business preserve its working capital for expansion of the business and offers a fantastic benefit, Financing, page 15

14 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

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The ripple effect of construction industry Construction industry professionals have said that new residential construction is a major economic engine that not only has a ripple effect into many other industries but is also a source of income for state and local governments.

According to reports issued in June by the National Association of Home Builders, in Washington state the economic impact from residential construction in 2011 was close to $4 billion. The NAHB estimated that 13,825 single-family homes were built in Washington, generating $3.1 billion in income for local residents (supporting more than 41,000 jobs) and an additional $7.3 million in taxes and other government revenues.

Additionally, that construction activity will lead to an annual income to residents of nearly $450 million (based on the new occupants’ participation in the local economy) and close to another $200 million in government taxes and revenues.

The report also includes an analysis of cumulative cost vs. revenue to government over 15 years, with a total of $623 million in revenues.

The NAHB economic model, which was developed in 1996, used the

assumption of a $297,714 average price statewide for a new home on a lot with the average land value of $18,423. The calculations used an estimated average of $12,029 for development/construction impact, permitting and other fees, as well as an average annual property tax rate of $3,275.

John Armstrong, past president of Home Builders Association of Kitsap County, said one of the reasons the industry has such a big impact is because nationwide, it is the largest employer outside of government.

“There are 90 divisions of work in new residential construction, and you have to multiply that by how many people you have per division,” he said. “That could be up to 450 — that’s a lot. It’s not that farfetched to say that construction is the largest employer in Kitsap County outside of government.”

The NAHB report only gives statewide totals. However, using the NAHB’s average one-year economic impact per home ($277,000) and the number of homes built in Kitsap County in 2011, according to county permit statistics

(208), the economic impact on the county could be estimated at $57.6 million last year.

“If you buy something like an appliance, some overhead and revenue leaves,” said Randy Biegenwald, a CPA who’s a board member of Kitsap HBA. “If you build a home, a much larger part of the house ‘stays’ local, versus the purchase of durable goods, because a lot of it is labor. A lot of these dollars recycle into the local economy more and that’s why construction has such a big impact on the economy.”

FINANCING

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 15

from page 14 with regard to its long-term fixed interest rate.

For projects greater than $1 million, the SBA portion of the loan can range from $400,000 to $5 million. For manufacturing companies and buildings that meet certain energy initiatives, the maximum SBA loan amount is $5.5 million. These SBA loan limits set the total project cost/size limits at $12.5 million to $13.75 million. For a $12.5 million project this translates to a borrower putting $1.25 million down, the bank lending $6.25 million secured by a first deed of trust, and the SBA lending $5 million secured by a second deed of trust.

Hopefully it is clear from the foregoing information that a wide range of projects will fit within the scope of this program and perhaps more importantly, affordable financing is truly available for construction financing today.

• Kerry Keely has more than 37 years of commercial banking experience and is vice president and manager of Kitsap Bank’s SBA Loan Department. If you would like more information or are interested in applying for a SBA 504 loan, call 360-876-7889.

Founded in 1908, Kitsap Bank is headquartered in Port Orchard, WA, operating 21 locations throughout Western Washington. With over $900 million in assets, the bank provides a full range of financial services to commercial and individual customers. BauerFinancial, the nation’s leading bank rating and research firm has given Kitsap Bank their 5-star rating; and Kitsap Bank has been named a Preferred Lender by the U.S. Small Business Administration.

Peninsula Paint owners had connection to Bainbridge store they bought

16 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

By Tim Kelly, Editor There’s a new name on the business, but an old sign inside is testament to the link between the current and previous owners.

When Mary Hall and Ken Schuricht decided to sell Winslow Paint Co., the Bainbridge Island store they opened in 2001, the buyers were a couple they knew well.

“I was a sales rep calling on them when they opened Winslow Paint,” Ray Donahue said, recalling how he helped the couple place orders for their original inventory.

Donahue and his wife, Diane, bought the paint store this summer from Hall and Schuricht and renamed it as part of their business, Peninsula Paint Centers.

It was essentially a prearranged deal between the two couples, who were partners in 2004 when the Donahues went into business by purchasing three paint stores in Poulsbo, Port Townsend and Sequim.

“They were ready to retire,” Diane Donahue said.

A few years after opening their paint store, Hall and Schuricht closed their other business, Winslow Hardware &

Mercantile, which had been a downtown fixture on Bainbridge Island for nearly 60 years.

The wooden sign that had hung in front of the hardware store was still in

Ray and Diane Donahue their driveway, Ray Donahue said, so he “touched it up a little bit and put it on the wall” inside the newest Peninsula Paint store.

The Donahues, who closed their

Sequim store last November, are branding all three of their stores with a program from Benjamin Moore, the primary paint line they carry.

“Hopefully by the end of the year or so, our stores will look a little different on the outside and inside,” Ray said, and they will feature new products Benjamin Moore has introduced.

One that will be new at the Bainbridge store is the Gennex platform of low-VOC (volatile organic compunds) paints.

“We have it at our other two stores and we think Bainbridge is going to love this product,” Diane said.

The new line also includes a waterborne stain that’s a viable low-VOC alternative to oil-based stains.

A lot of the new paint products are hybrids that are easier to use, Ray explained, because they are “oil-based but with soap-and-water cleanup.” They also have better color retention and longevity, he said.

Another change is making the Bainbridge store more accommodating to the needs of contractors. The store’s hours have been expanded to open at 7 a.m., and rentals of equipment such as power washers and paint sprayers are available through the larger Peninsula Paint store in Poulsbo.

The Donahues said their business felt the recession’s impact just like other retailers linked to the struggling construction industry.

“The contractors got hit really hard,” Diane said. “2010 was our toughest year since we’ve owned the business.”

But even when home sales are down, people still do home improvement projects, and that often includes repainting.

“It’s the cheapest thing you can do, and the biggest bang for your buck,” Ray Donahue said.

Peninsula Paint Centers features Benjamin Moore’s high-end products, but Donahue said the company also is introducing new products that are less expensive and that “target a younger clientele, who have grown up at Target and Home Depot.”

There’s also a new product line coming called Color Stories, and Diane said “it’s kind of the buzzword out there.”

What makes it unique is missing in several more colorants than are normally mixed used in paint, Ray explained, giving it a reflective quality that changes with the light at different times of day.

Winslow Paint had a lot of loyal customers on Bainbridge Island, but the new store owners said the community response has been very welcoming.

“We’ve had customers come in just to introduce themselves,” Ray said. “We’re excited about this opportunity; it’s a great location, and a great market.”

Kitsap Trident Homes: A father-son team

By Rodika Tollefson Kitsap Trident Homes, based in Poulsbo, has built a range of houses since 1978, from affordable custom homes for first-time buyers to high-end and spec homes. Owner Jim Ingalls has had an advantage since 1999 — his son, Justin, started working for him full-time after college and, as project manager, is involved in various aspects of the business.

“I do believe it’s an advantage, us working together. One of these days he’ll continue on,” Jim Ingalls said. “He’s thoroughly enjoying it and our working relationship has been great over the years.”

Jim Ingalls became the owner of Kitsap Trident Homes (www.kitsaptridenthomes.com) somewhat by accident. He came from Montana with the company’s previous owner to work in Suquamish. When the owner returned to Montana, Ingalls decided to stay and proceeded with growing the company locally.

At its peak, the business had as many as 25 employees but Ingalls said that impacted the quality. “I wanted to cut back and to focus on affordable custom homes,” he said.

“We’ve been able to pare it back to a smaller company, control quality better and give better service to our clients.”

Justin Ingalls got his first taste of

construction while in high school, starting out as a laborer. A 1994 North Kitsap High School graduate, he returned to the community after graduating with a business degree from Washington State University.

“It’s probably allowed us to take on more projects because we both can oversee them and do more complicated work,” he said.

They both enjoy taking on challenging sites and thinking outside the box, as well as working directly with the owners, driving the process by making selections and meeting with the builders regularly.

“We tailor our mold to every individual job and we build at the pace the owner wants,” Justin Ingalls said.

He said they have been fortunate in the past five years. While the work has slowed down, they’ve consistently had major projects, which they’ve been able to supplement with smaller ones such as remodels, repairs and tenant improvements. Since they’ve had to downsize, both Ingalls have also been involved more hands-on — an aspect they love. “We’re both low-key and laid-back and we bounce ideas off each other,” Ingalls said.

They have a crew of three to five people and while the elder Ingalls works mostly on the office and his son mostly on sites, they

Silver View will offer 72 home sites near Port Orchard

sometimes switch places to keep that hands-on involvement.

“I’ll take my tool belt out and try to compete with the best, even if I’m not as fast as the young guys,” Jim said. “I’ve always enjoyed finish work…. I like seeing the homes come together.”

Justin feels a big part of the company’s success is due to his father building a reputation of “being true to his word and following up.”

“Customers become part of the Trident family and we take pride in that,” he said, adding that some have even come to family events like weddings. “They get to know us personally.”

Although Jim Ingalls is far from thinking about retirement, he loves the idea of his son taking over the company eventually.

“One of these days, he’ll keep me out,” he said. “He’s always been my retirement program.”

Proposed update of Poulsbo’s development regulations moves to council The Poulsbo Planning Commission has completed its review of the proposed development regulations including the city’s zoning ordinance and is moving ahead with a recommendation to the City Council. The commission’s five-month review culminated in August with a public hearing.

The proposed zoning ordinance provisions include dividing the zoning into four commercial districts, more detailed architectural design standards, updated sign codes, annexations, development agreements, and medical marijuana collective gardens, among other things, according to a planning staff summary. Also included are provisions for planned mixed-use developments on Viking Avenue and the State Route 305 corridor, and nonresidential uses in residential districts.

City Council members are expected to begin workshops as early as Sept. 12 on the proposal and a public hearing has been tentatively scheduled for Nov. 28. The council will accept written comments through the day of the hearing.

According to city planning staff, the main purpose of the zoning ordinance update is to incorporate provisions from the new comprehensive plan, which was adopted in 2009.

The zoning ordinance review is the second of three phases in the city’s development regulations update. The final phase, expected to commence in 2013, will include revisions to the permit process, subdivision code, and building and construction (Title 15).

For more information including the proposed zoning ordinance, go to www.cityofpoulsbo.com.

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September 2012 Kitsap Peninsula Business Journal • KPBJ.com 17

By Tim Kelly, Editor Site work has begun on a 15-acre South Kitsap development that will have 72 houses when completed.

Freeland Industries is clearing the wooded site, which has a creek running through it, and installing sewer lines for Silver View. The development is located near Port Orchard about two miles east of State Route 16, along the south side of Sedgwick Road and west of Philips Road.

Company owner Jay Freeland said the first phase will prepare 27 lots that should be ready for home construction in November. The rest of the lots will be finished by next summer.

Freeland Industries bought the property last year from JWJ Group LLC, a Poulsbo developer that filed the original plat for Silver View that Kitsap County approved in 2010.

“I think it’s going to be a real pretty project when it’s finished,” Freeeland said.

The homes will be built by The Peoples Builder, a construction company based in Pierce County, and will be priced in the $175,000 to $225,000 range, said Scott Haas, one of the company’s three owners.

Silver View will offer a wide range of models from 1,000 to 2,200 square feet, and Haas said most of them will be two-story houses to fit on the relatively small lots, of which most are 3,000 to 4,000 square feet.

“To get the bigger square footage, you’re going to have to go upstairs,” he said.

He added that the second phase of the development could include some larger houses up to 2,600 square feet.

“There are a few lots in the second phase that will be able to handle that size,” he said.

Although the price range at Silver View suggests the project will appeal to first-time buyers, Haas said the homes will have value that will generate interest among a broader group of potential buyers.

The homes will be marketed starting later this year through the Coldwell Banker real estate office Port Orchard, where Freeland’s wife, Gabrielle, is an agent.

This is the first venture in Kitsap County for The Peoples Builder.

“That whole area, with the Navy especially, is becoming known as a good place for people to live,” Haas said.

His company also is working on a 28-lot development called Morning Point Estates in Gig Harbor.

Silver View is the first residential development in the Port Orchard area done by Freeland Industries, which built houses last year in the 45-unit Stampede subdivision developed by JWJ Group in Silverdale.

Jim and Justin Ingalls

Smallwood Design & Construction adapts to changing market

By Tim Kelly, Editor His company’s toughest stretch getting through the economic slump was last winter. Rob Smallwood said things are picking up again this year for his Bainbridge Island business, but the home construction landscape has shifted and the heady days before the recession aren’t likely to return.

“We had people walking in the door asking when we could build their house,” the owner of Smallwood Design &

Construction said. “Times were pretty good several years back.”

Despite having to scale back and operate with fewer employees because of the recession’s impact, “we were able to keep busy for the most part,” Smallwood said.

“But there were times, when things were slim, we were wondering where our next job would come from.”

More of their jobs are remodels now — with Rob handling much of the design,

18 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

the peninsula’s magazine

which is his forte — instead of just building custom homes. The business has adapted in other ways as well.

They started Smallwood Home as a proactive maintenance service that “basically maintains the value of people’s homes,” Rob said, explaining that it’s more thorough than what’s covered under a typical home warranty. Their new home customers are automatically signed up for a two-year plan.

He noted that a lot of people who want to build a home in today’s market tend to have a different perspective.

“Customers are all cost-conscious; they’re looking closely at how they’re going to spend their money, or if they’re going to spend it at all,” he said. “We’ve had two or three major projects that just got shelved.”

Although they do have one home under construction that’s about 5,000 square feet, Smallwood said customers are generally interested in a house that’s less expansive and more efficient.

“I’d say the majority of people we’re talking to now are looking for a smaller footprint,” Smallwood said.

“We’re kind of getting two ends of the spectrum,” he said. “We get some empty nesters who are interested in a smaller home and don’t want to live the condo life.

They’re looking for a well thought-out home in the 2,000 square-foot range.

“And there are 30-somethings looking for a first family home.”

Green building and sustainability are integral to the company’s design and construction work, especially since they built a state-of-the-art home a couple years ago for Ed and Joanne Ellis. Designed by Bainbridge architect Matthew Coates, the couple’s house was the first in the state

outside of Seattle to be certified as LEED Platinum, the highest rating in the U.S. Green Building Council’s Leadership in Energy and Environmental Design program.

“Building a LEED home was a real educational process for us,” Smallwood said. “We were doing a lot of things we hadn’t done before.”

The homeowners are major advocates of sustainability and the project got a lot of exposure in the media and through

Rob Smallwood with sons Ryan and Shad community open houses held there, which led to customers asking Smallwood’s company to build homes incorporating some of the features from the LEED house.

“I think we’re a better business for having done that,” said Denise Linrothe, project administrator in the company’s office.

The business also includes Smallwood’s sons Ryan, who was the job superintendent for the LEED house, and Shad, who’s a project manager. Both sons worked their way up, starting as job site laborers when they were teenagers.

Smallwood’s company has operated for more than 30 years and it’s still what he wants to keep doing, despite the challenges of the last few years.

“Even though it’s been a struggle through the economic downturn,” he said, “I still enjoy this business.”

Tim Ryan Construction completes remodel for Gravitec Systems

ON THE STREETS NOW!

www.wshomeandgarden.com

Tim Ryan Construction, Inc. of Poulsbo has completed the Gravitec Systems Inc. headquarters.

The project involved remodeling an existing 42,000 square-foot building and adding a second-floor mezzanine that provides an additional 8,600 square feet of administrative and engineering office space.

The three-month project transformed a former sports complex into the new company headquarters.

For more information about Tim Ryan Construction’s commercial building projects, call (360) 779-7667 or visit the company’s website at www.timryanconstruction.com.

September 2012 Edition

Events And Activities VIST the NEW HBA Website! www.kitsaphba.com Up To Date Calendar On Line Registrations!

Secure Online Payment Monday, September 3 HBA OFFICE CLOSED Saturday, September 8 EDUCATION First Aid/CPR Training & Cert.

(10:00 a.m.-12:00 p.m.)

Register with the HBA office 360-479-5778 Wednesday, September 12 Remodelers Council-SPECIAL DATE- 4 p.m.

Thursday, September 20 Fall Season Social — McCloud’s (East Bremerton-5:00 p.m.)

Friday, September 21 Application/Submissions Due for REX (by 5 p.m.)

Tuesday & Wednesday September 25 & 26 EDUCATION Advanced Green: Building Science Register w/BIAW 360-352-7800 Thursday, September 27 Executive Cmt. Mtg (2 p.m.)

Government Affairs Cmt. (2:30 p.m.)

Board of Directors (3:30 p.m.)

Friday, September 28 EDUCATION CECSL Re-Certification CLASS Lunch Included Register w/BIAW 360-352-7800

Urban Growth Areas Redefined per Growth Management Hearings Board’s Ruling In September 2011, the Central Puget Sound Growth Management Hearings Board concluded that Kitsap County must re-examine its Urban Growth Areas (UGAs) expanded during the 2006 Comprehensive Plan update process. The remand decision came after a five year legal challenge that ultimately went to the Court of Appeals and back to the Hearings Board for decision. The order of the board is limited in scope and focuses on two main issues: The County must reconsider what an appropriate minimum urban density is in its single family residential zones, and what density should Kitsap use when calculating urban area or land capacity to accommodate population growth through 2025.

The matter of defining UGAs is a tricky one and directly affects property values. Redefining these areas after 6 years — and well before the next comprehensive plan is due to be drafted — may have a devastating impact on some property owners. The impact will be even more severe as it is coming after several years of declining property values. Under the Washington State Growth Management Act, development is supposed to be planned for, and directed to, areas where efficient urban services can be provided. To this end, the zoning, development, and construction codes all work together to push development into the UGAs. This process has been underway in Washington for many, many years and the recent remand is not a result of some new public policy or regulatory practice. The remand is the result of an interest group electing to take the plan to the court system after not getting exactly what they wanted out of the public process.

We expect that the newly defined UGAs will all be smaller with the only exception being the inclusion of approximately 170 acres in the CK UGA that should have been included 6 years ago due to the accessible and underutilized sewer line and water facilities. The need of infrastructure like sewer, water, and roads are all key elements to development. Development will most often follow where the infrastructure is. It is, and will continue to be important for the County’s elected officials to invest in quality infrastructure and to encourage development that maximizes the investments made by both the public and private sectors.

At the time of this writing, the Kitsap County Board of Commissioners is scheduled to make its decisions in the next 10 days. By the time this article is printed, their work will be done. The affect of those decisions will be played out for months and years to come. We have asked the members of the Board of County Commissioners as well as each of our legislators to work together to find a solution to the broken Comprehensive Planning process. In Kitsap, after months and months of public input and hundreds of thousands of tax payer dollars, the citizens can not (from history’s pattern) expect to have, use, and fully implement a Comprehensive Plan. The 2006 plan was written well in advance of when it should have been (due to litigation) and here we are again with this 2012 version only to begin this whole process again in 2014 or ‘15 for an updated plan due to be adopted in 2016. This is not only extremely expensive in actual dollars spent but also in lost dollars caused by a lack of certainty and diminished commerce.

For all the details on the UGA remand as well as the final decisions of the Board of County Commissioners, visit www.kitsapgov.com.

2012 OFFICERS President . . . . . . . . . Wayne Keffer, CGR, CAPS First Vice President. . . . . . . . . . . . . . . Robert Baglio Second Vice President . . . Judy Mentor Eagleson Treasurer . . . . . . . . . . . . . . Randy Biegenwald Secretary . . . . . . . . . . . . . . Dee Coppola, CGA Immediate Past President. . . Justin Ingalls, RCS

2012 BUILDER & ASSOC. DIRECTORS Karla Cook • Judy Granlee-Gates Joe Hurtt • David Godbolt, CAPS, CGP, CGR Kevin Hancock • John Leage Robert Lubowicki • Leslie Peterson, CGA Shawnee Spencer • Jim Way, CGB

2012 STATE DIRECTORS Robert Baglio • Greg Livdahl • Gale Culbert Lary Coppola • Judy Mentor Eagleson Justin Ingalls, RCS • Wayne Keffer, CGR, CAPS Robert Coultas • Ron Perkerewicz

2012 ALTERNATE STATE DIRECTOR John Armstrong • Walter Galitzki Brent Marmon

LIFE STATE DIRECTORS Bill Parnell

2012 NATIONAL DIRECTORS Wayne Keffer, CGR, CAPS • Judy Mentor Eagleson

2012 ALTERNATE NATNL. DIRECTORS Michael Brown • Jeff Coombe

LIFE DIRECTORS Rick Courson • Jim Smalley • Bob Helm Bill Parnell • Larry Ward John Schufreider • Dori Shobert

2012 COUNCIL & CHAIRS Build a Better Christmas. . . Randy Biegenwald Built Green . . . . . . . . . . . . . . . . Walter Galitzki

By Laws & Nominations . . . . . . Justin Ingalls Developers Council . . . . . . . . . . . . Rick Cadwell Golf Classic . . . . . . . . . . . . . Shawnee Spencer Govt. Affairs Cmte . . . . . . . . . . . Robert Baglio Remodelers Ccl Chair. . . David Godbolt, CGR, CAPS Membership . . . . . . . . Judy Mentor Eagleson Parade of Homes . . . . . . . . . . . . . Dee Coppola Peninsula H&G Expo. . . . . . . . . . Ardi Villiard Peninsula H&R Expo. . . . . . . . . . . TJ Erickson

HBA STAFF Executive Vice President . . . Teresa Osinski, CGP tosinski@kitsaphba.com Expo & Events Director . . . . . . . . . . . . . . TBD hbaevents@kitsaphba.com Administrative Coordinator. . . Kathleen Brosnan info@KitsapHBA.com

Home Builders Association of Kitsap County 5251 Auto Center Way, Bremerton, WA 98312 360-479-5778 • 800-200-5778 FAX 360-479-0313 www.KitsapHBA.com

THE 2012 FORD F-SERIES TRUCKS TORTURE TESTED

PORT ORCHARD FORD

1215 Bay Street, Port Orchard, WA 98366 • 360-876-4484

brucetitus.com

September 2012 Edition

It has been a busy summer for most in the building industry, with the challenge of selling work in a continued tough market and if you’re Wayne R Keffer Construction Inc. busy it seems we are trying to get more done with less while 2012 President navigating the ever changing rules and regulations that our industry always seems to be under fire from.

With all that challenge close to mind I was pleasantly surprised when I and other HBA leaders visited with Kitsap County Department of Community Development and received an update on the LEAN process and its initial results. The process that they have undergone has resulted in reorganizing many of the processes that are needed for residential permitting. Each permit now has a person in charge of it from beginning to end; which gives ownership to the permit manager.

The residential permit managers we met seem ed excited to be able to take control and challenge them to get the jobs completed. In fact it seemed kind of like a competition to see who could get their permits out as quick as possible.

They have also been reorganized into a group that has all the people required to complete a permit working in the same space so that the permits are not being shuffled around the entire building, this also appears to save some time.

Additionally, the Department has hired a “front desk/greeter” to help facilitate all the visitors, but to also help those that have a simple request or there to pick up a completed permit. Now when you go in to pay and pick up your approved permit you shouldn’t have to wait very long at all. Having a greeter should keep the lobby wait time down.

As with all changes there are always bumps in the road and there will surely be breakdowns but I am encouraged that there is effort being made. DCD staff appears energized and ready to make those changes.

We were informed that both the commercial side as well as the process for inspections would be going thru the process soon. The HBA looks forward to being part of the process and being able to give input. If you have any feedback on how they a re doing I would let them know, they really seem open to finding the best way to get their jobs complete.

Looking forward to fall I want to remind everyone about the upcoming Remodeling Excellence (REX) awards. If you have done a remodel you are proud of — this is the opportunity to show it off! Applications are due to the HBA on Friday, September 21, 2012. You can also download the application through the HBA calendar on the NEW website, www.kitsaphba.com. Go to the About the HBA tab at the top, scroll to the Remodeling Excellence Awards and download the application. Also, don’t forget the fall Peninsula Home and Remodel Expo! This event should be on your calendar. Applications are being accepted now for booth rentals. Call the HBA and be a part of this event to get in front of Kitsap’s homeowners looking for help on their homes. If you can’t do a booth, think about donating 2 hours and being an HBA greeter! Networking always happens between area businesses too. So don’t be left out! Call the HBA or visit the NEW website at www.kitsaphba.com and click on the link for the Peninsula Home & Remodel Expo.

Wayne Keffer CGR, CAPS

Teresa Osinski CGP

Executive Vice President

NEW Website Means Expanded Services for Members Late in July the HBA rolled out a new website. Please take the time to visit the site and familiarize yourself with all the ways it will help you to maximize your membership with the HBA (WWW.KITSAPHBA.COM).

FIND A MEMBER This tab of the website is where you will search for other members and where the public will search for you. They can find you by looking in a category, or by typing your company name, or even by typing the name of the primary representative of your company. Try it! For the public this is helpful because they may remember part of a name, or maybe your personal name, but can’t quite recall the whole thing. This will help them narrow their search.

GET THE MOST OUT OF YOUR LISTING All HBA members are listed in our on-line directory. Make the most of your listing by sending to the HBA the following information-Brief Company Description: Send us no more than a two sentence description of your company. This might be your tag line or maybe a sentence from your mission statement. Whatever you think will help the viewer get an immediate impression of what your company is all about. This brief will appear in the category view as well as on your individual listing.

Company logo — Please send us your logo and we will upload it to your listing.

Social Media and Websites — If you have a facebook, LinkedIn, or Pinterest, page, please send us the addresses and those will be linked to your site. Send us your website address and we will include that too.

PURCHASE AN ADVERTISEMENT For the first time, the Board of Directors has authorized a limited number of advertising spaces on the website. You can advertise on the main page of the directory or on a specific subcategory page. Review the “Advertise With Us” link at the bottom right corner of the home page for the details or call the HBA if you have questions.

MEMBER BENEFITS Learn all you have access to as an HBA member. This tab on the site will be kept up to date as our benefit programs grow and change. Anytime you need the information, it will be there for you 24/7. As a member you have buying power you wouldn’t otherwise have. These programs are provided through the NAHB Member Advantage, Builder Books, and the National Purchasing Program. Might want to buy a Dell Computer? Check out your Member Advantage Discount. Thinking about getting a Verizon Wireless account? You should log into the National Purchasing Program. Want a book on the latest construction trends? Check out NAHB’s Builder Books. Coming soon we will be offering a gas rebate program! Watch for that on our website.

EVENTS & NEWS In addition to past newsletters and other up to date news items, you will find the fully functioning event calendar. In addition to seeing all the activities going on, you can download flyers or registered right on line!

JOIN or RENEW New members and renewing members can apply or renew right on the website and make payment at the same time.

Be sure to take a few minutes and investigate the new site. We are very happy to roll this out and know it will be a beneficial service to our members and the public. It is always good business to do business with HBA members and now it’s easier than ever! WWW.KITSAPHBA.COM.

5 Great Reasons to Buy or Remodel 1. LOW INTEREST RATES Mortgage rates are not expected to remain low. Buying or refinancing now can reduce monthly payments substantially.

2. GREAT PRICES Housing affordability is the best it’s been in years. As the supply and demand in our housing market comes back into balance, prices will begin to rise again.

3. OUR HOUSING MARKET IS IMPROVING Don’t see your dream home on the market? Call one of our professional custom home builders — they can make your dream a reality.

4. ENERGY EFFICIENCY Today’s new homes are designed to save you money on your monthly utility bills, and increasingly incorporate exciting new green technologies.

5. PROFESSIONAL BUILDERS, REMODELERS & LENDERS The Home Builders Association of Kitsap County has hundreds of member companies to guide you through any housing questions you have. Visit our website at www.kitsaphba.com or call us at 360-479-5778.

www.KitsapHBA.com

September 2012 Edition

Government Affairs Committee

Elections 2012

The primary is behind us. Not really many surprises, except perhaps Robert Baglio locally in the south end The BJC Group Commissioner race. I think 2012 Chair many people thought the former mayor of Port Orchard, Lary Coppola, would advance to the general election, but that is politics and the results can be unpredictable. To the right are the “top two” vote getters for many important races.

Now we head into the general election, with the races narrowed down to two candidates, things will get even more interesting.

On the national stage, the Presidential race is taking shape. Mitt Romney has chosen Paul Ryan, Representative from Wisconsin, as his Vice Presidential candidate. Paul Ryan has been the brain child behind Congresses efforts to get a handle on spending, develop a plan to deal with our national debt, and take steps to resolve the looming insolvency of our Social Security systems. It will be interesting to see if the selection of Paul Ryan as a running mate will force the campaigns to focus more on the issues as opposed to the depressing continued proliferation of negative, exaggerated rhetoric that we hear day in and day out. I for one believe the American people are tired of this useless propaganda. They are more intelligent than many politicians give them credit for and they will welcome a campaign that discusses the issues and supports their positions with facts.

Something has to be done to get this country back on track. We cannot continue to spend money at our current pace. For goodness sakes our Federal Government has been operating unchecked without a budget for over three years. Every other State, City, and County in the entire United States of America has a budget in place.

How can you control spending if you do not have a budget to measure or track the rate at which you are spending money? It is absurd. Nor can we keep our head in the sand pretending that nothing is wrong as our Social Security system marches ever closer to insolvency. We have to get a grip on spending and we must develop a plan to pay down the national debt. I hope the presidential race turns its focus to these key issues, it is imperative for the welfare of this country.

Remember to vote. Every vote does count. Let your voice be heard.

The results of 2012 primary election are provided on the right.

How did your candidate do?

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24 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

We Are Still Accepting Online Nominations!

We are now accepting nominations for the Kitsap Peninsula Business Journal’s annual 40 Under Forty leadership recognition program!

Do you know someone outstanding in their industry or profession who is deserving of recognition? Help us highlight the best and brightest young business leaders on the Kitsap Peninsula. Individuals must be under the age of 40 on Sept. 15, 2012 for consideration.

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Marshalls opens in Gig Harbor at remodeled ex-Borders site

By Rodika Tollefson Marshalls will open a store in Uptown Gig Harbor on Sept. 6, the clothing chain’s only location on the Olympic Peninsula. The 40-year-old retailer has more than 880 stores nationwide and in Puerto Rico and specializes in off-price designer brand names.

The 24,670-square-foot store is located in the space that was vacated by Borders Books in April 2011 in Uptown Gig Harbor. Gateway Capital, the developer of the property, has invested $1 million into the remodel of the building.

“Marshalls doesn’t stock every Marshalls store the same. They make adaptations to the community so it should be a very interesting store once they figure out the community,” said Gateway Capital’s John Hogan, a Gig Harbor native who developed Uptown.

Marshalls works with more than 15,000 vendors in 60-plus countries, and company representatives said every week, 10,000 new items will be arriving at the Gig Harbor store. The store will create 60 full- and part-time jobs.

“The new Gig Harbor store will be stocked with a new, fresh assortment of the designer and brand name merchandise that shoppers love, every

single week,” Richard Sherr, president of Marshalls, said in a statement. “Our buyers are fashion experts with a keen sense of style and are passionate about finding the most coveted merchandise for our shoppers for so much less.”

Hogan said a two-level store is rare for the retailer but both parties made it work.

“They really saw a demand for the marketplace … and Uptown was a logical fit because it had a lot of tenants they thought were desirable. With the trends we’ve seen at the national level, most lifestyle centers are becoming hybrid centers rather than having merchants at a certain price point.”

With the former Borders store now occupied, Uptown is about 97 percent leased. An optical shop will also open its doors in September.

The Point Fosdick Square, next door to Uptown, has several new retail buildings for lease and a Kohl’s will be opening in September as well. Hogan said while there may be a little overlap between the merchants, it turns the area into an even bigger destination than before. A broader mix of retail and services, along with lower sales tax in Gig Harbor and savings from the bridge toll make that commercial area an attraction.

Marshalls, page 25

Encore Communities acquired by Tennessee investor The three facilities were developed in the early to mid-1990s by Leslie and Rick Krueger, and later unified under the name of Encore to “add cohesiveness” to the organization’s identity, according to a Kitsap Business Journal interview with Leslie Krueger last year. The umbrella also included at the time the Alpine Way retirement apartments in Shelton, owned

by Rick’s parents, Les and Betty Krueger.

The family is well known especially in the North Mason area for their major support of community projects.

Krueger had told KPBJ she saw the need for senior care in 1987, when she worked as manager for Claremont East retirement apartments, owned by her inlaws at the time and later sold. “After just a few weeks of working there, I realized that we were missing a link in senior care and that many of our residents needed some help with their medications, activities of daily living and coordination of their health care services,” she said.

The couple later developed a corporate office and The Villas on Clifton Ridge, both in Belfair. Rick Krueger was also the developer for the Harrison Medical Center clinic in Belfair.

The Kruegers could not be reached for comment after the Encore sale.

Hutchens said his company purchased the campus after Santé identified it as a property of interest.

“When we visited the campus, we were very impressed by the property condition, the impact on the community and the broad scope of the operations,” he said.

A representative with Santé could not be reached by deadline, but Hutchens

said the operator was “very impressed” with existing management and was planning on making only a few operational changes. According to reports, a $2 million remodel and expansion of Northwoods Lodge will start this fall.

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By Rodika Tollefson The operation of Encore Communities in Silverdale switched hands in August, following the acquisition of its facilities by National Health Investors, Inc. NHI acquired the senior living campus for $25.2 million. Encore includes the Country Meadows independent retirement cottages, the Clearbrook Inn assisted-living apartments and Northwoods Lodge, a skilled nursing and rehabilitation facility.

Santé Partners of Salem, Ore., will lease the campus from NHI and operate it. Santé is one of about 35 operators with whom NHI works in 25 states under lease arrangements. This will be the first Washington state property for NHI, a publicly traded company that owns 102 other properties, according to its website.

“We buy the real estate and lease it long-term to an operator,” said NHI president and chief executive officer Justin Hutchens. “We specialize in purchasing senior housing properties as well as health care properties and we’ve been expanding — over the past three years, our company has grown by a third.”

He said NHI generally invests in local and regional facilities. Santé signed a 15year lease with the company, with two 10year renewal options. It will also pay a lease rate on an additional $3.5 million NHI invested in the renovation of Encore Communities.

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Clarification An article in our August edition about the liquor stores transition incorrectly identified the new fees. The $3.77 per liter tax was already in existence, as was a 20.5 percent tax per sale. The new fee added by the initiative is an additional 10 percent markup for purchases made through distributors and 17 percent through retailers. The distributors have a March 31, 2013, deadline to reimburse the state $150 million for the first-year revenue loss from closure of state-run liquor stores.

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 25

from page 24 Gateway Capital plans a second phase for Uptown at some point and is hoping to attract merchants like men’s apparel retailers and service providers, but Hogan said their preference is to wait until Point Fosdick Square has all the tenants in place.

Marshalls will have a ribbon-cutting at 7:30 a.m. on Sept. 6. The ceremony will include the presentation of a $5,000 donation to the Key Peninsula branch of The Children’s Home Society. The grand opening will continue from 8 a.m. to 10 p.m. with giveaways and prizes.

26 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

Obesity issues becoming more significant in the workplace and in hiring decisions severe or morbid obesity as an impairment under the Act, but not general obesity itself. But this appears to have changed with the ADAAA (Americans with Disabilities Act Amendments Act). In the 2011 version of the EEOC’s Compliance Manual, they have removed the language that says that obesity is rarely an impairment. Many people believe that obesity may be on its way to being treated as a protected class. Here are some cases to think about.

In Montana, Eric Felt sued BNSF Railway after it took back his offer of employment as a conducter due to the fact that his obesity would cause him to be unsafe in the position. They told him if he lost 10 percent of his body weight, or underwent physical exams at his own expense, they would reconsider. After his complaints went through the legal process, the Montana Supreme Court ruled that his obesity was an impairment under the ADA, and therefore he was protected and required accommodation under the law.

An interesting point about this ruling was that the obesity factor stood alone as an impairment, and did not have to be linked to an underlying physiological condition.

Family House of Louisiana was ordered to pay $125,000 to settle a discrimination lawsuit brought against them by the EEOC on behalf of Lisa Harrison. They alleged Harrison was terminated due to her severe obesity. An attorney for the EEOC stated “Employers cannot rely on unfounded prejudices and assumptions about the capabilities of severely obese individuals … Any notion that these individuals are not protected, based on the wrongheaded idea that their condition is self-inflicted, is simply wrong and without legal basis.”

Earlier this year, Citizens Medical Center in Texas announced that job applicants would not be considered unless they had a body mass index (BMI) of less than 35, which would eliminate all obese applicants. Their express purpose for this policy was to have employees “fit with a representational image or specific mental projection of the job of a healthcare professional.” Whether or not this blanket policy violates the EEOC’s guidelines is unclear, but they did come under severe criticism, and quickly abandoned their

policy due to the public outcry.

It seems apparent that obesity and employment are still figuring out how they’ll work together. But some communities prefer to be trendsetters, rather than wait for federal laws to guide them. As of now, only one state, Michigan, expressly prohibits employers from discriminating against employees based upon their weight. Their civil rights law, passed in 1976, prohibits discrimination based on weight. Six cities in the U.S., including San Francisco, Washington, D.C., and Madison, Wisc., either outright forbid discrimination based on weight, or forbid discrimination based on personal appearance. Legislation is now pending in Arizona that also will make it illegal to discriminate based on weight.

Employers need to be careful about making assumptions about the effects and causes of an employee’s or job applicant’s weight. Even if the weight, in and of itself, is not a disability qualifying for ADA protection, under the ADA, if the employer perceives that a disability may exist, liability may then arise under the ADA. For example, if you as an employer, perceive that an employee is out of shape enough that they couldn’t perform the duties of a job, then your perception and assumptions could be enough to qualify them for protections under the ADA. Under the ADA, employers are required to provide reasonable accommodations. For an obese employee, that might include a special chair that can hold an individual weighing up to 600 pounds, sturdier toilets in company restrooms, moving cubicle walls to provide additional workspace, allowing the employee to sit on a high stool rather than stand all day to serve customers, positioning the employee on the ground floor to avoid excess climbing of stairs, and providing alternatives to company uniforms that will accommodate the employee’s weight.

This issue is likely to remain a hot potato. The National Association to Advance Fat Acceptance’s study states that overweight adults are 12 times more likely to experience discrimination in employment, obese adults 37 times, and severely obese people 100 times. Fortythree percent of overweight people they

surveyed reported they had already experienced weight bias from employers and supervisors. They state that overweight people earn up to 6 percent less than their nonoverweight co-workers and are more likely to be viewed as underachievers. Fifty-four percent reported being stigmatized by coworkers. Many were concerned that they faced dismissal or suspension due to their weight, had concerns they wouldn’t be hired for positions, and reported being targets of derogatory comments and jokes.

With Michelle Obama’s focus on the war on weight and the EEOC’s expansion of protections under the ADA, we will no doubt continue to see debate on the impacts of obesity in the workplace and whether it should become the next protected class.

Whether or not you like Gov. Christie’s politics, he’s an interesting national example to elevate our discussion of weight and employment. Should his weight be considered when citizens cast their votes?

Does his weight impact his ability to do his job? Should we be concerned that his weight may impair him during his term of office? Or do his qualifications trump this discussion? As his political career ascends, the discussion of how his weight will impact it will grow louder, and it will give all of us the opportunity to consider how weight, work, qualifications and individuals go together, and how we, as business people, recruit and retain the best employees, while keeping our businesses profitable and productive.

• Julie Tappero is president and owner of West Sound Workforce, a professional staffing and recruiting company based in Poulsbo and Gig Harbor. She can be reached at julie@westsoundworkforce.com. View her LinkedIn profile at www.linkedin.com/ in/jtappero. The recommendations and opinions provided are based on general human resource management fundamentals, practices and principles, and are not legal opinions, advice, or guaranteed outcomes.

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September 2012 Kitsap Peninsula Business Journal • KPBJ.com 27

By Julie Tappero, owner Westsound Workforce The statistics are out, and they’re not surprising: Americans are getting fatter. In fact, the number of obese adults in the U.S. more than doubled between 1980 and 2008.

The Centers for Disease Control says that today over one-third (35.7 percent) of Americans are obese. In Washington state we’re a bit better than average, with obesity at 26.5 percent. With obesity expanding, it’s an issue that has an impact on the workplace. In the words of Gov. Chris Christie, “Man up and say I’m fat!”

Many studies have been done on the impacts of obesity on health. The CDC and the National Institute of Health (NIH) relate obesity to heart disease, stroke, diabetes and some types of cancer, all of which are leading causes of preventable death. In 2008, the medical costs associated with obesity were about $147 billion. In a time when businesses are fighting rapidly rising health care costs and operating with fewer employees, it’s understandable that obesity would be of concern to employers.

There is a case to be made that work is a contributing factor to the expansion of obesity. Our jobs are simply more sedentary. We have moved away from production-focused jobs to those where we sit facing our computers most of the day.

Researchers who looked at occupations over the last 45 years found that, on average, we utilized 124 to 140 less calories a day at work than we used to due to lowered physical activity. A CareerBuilder survey of 5,700 workers found that other contributing factors included eating because of stress, eating meals out due to our jobs, workplace celebrations, skipping meals because of time constraints, temptations such as office treats, and pressure to eat food that co-workers bring in.

Can an employer assume that a lean employee will have better attendance, lowered health insurance costs, and be more productive? And if so, does this mean that an employer can discriminate against an obese job applicant or employee? Is obesity a protected class? The answer to that question may surprise you.

When the Americans with Disabilities Act was first passed, the EEOC viewed

Diversify your investment risk

By Michael Allen All investments carry risk. But, as an investor, one of the biggest risks you face is that of not achieving your longterm goals, such as enjoying a comfortable retirement and remaining financially independent throughout your life. To help reach your objectives, you need to own a variety of investment vehicles — and each carries its own type of risk.

If you spread your investment dollars among vehicles that carry different types of risk, you may increase your chances of owning some investments that do well, even if, at the same time, you own others that aren’t. As a result, you may be able to reduce the overall level of volatility in your portfolio. (Keep in mind, though, that diversification can’t guarantee a profit or protect against all losses.)

To diversify your risk factors, you first need to recognize them. Here are some of the most common types of investment risk: • Market risk — This is the type of risk that everyone thinks about – the risk that you could lose principal if the value of your investment drops and does not recover before you sell it. All investments are

subject to market risk. You can help lessen this risk by owning a wide variety of investments from different industries and even different countries.

• Inflation (purchasing power) risk — If you own a fixed-rate investment, such as a Certificate of Deposit (CD), that pays an interest rate below the current rate of inflation, you are incurring purchasing power risk. Fixed-income investments can help provide reliable income streams, but you also need to consider investments with growth potential to help work toward your long-term goals.

• Interest-rate risk — Bonds and other fixed-income investments are subject to interest-rate risk. If you own a bond that pays 4 percent interest, and newly issued bonds pay 5 percent, it would be difficult to sell your bond for full price. So if you wanted to sell it prior to maturity, you might have to offer it at a discount to the original price.

However, if you hold your bonds to maturity, you can expect to receive return of your principal provided the bond does not default.

• Default risk — Bonds, along with some more complex investments, such as options, are subject to default risk. If a company issues a bond that you’ve bought and that company runs into severe financial

difficulties, or even goes bankrupt, it may default on its bonds, leaving you holding the bag. You can help protect against this risk by sticking with “investment-grade” bonds — those that receive high ratings from independent rating agencies such as Standard & Poor’s or Moody’s.

• Liquidity risk — Some investments, such as real estate, are harder to sell than others. Thus, real estate is considered more “illiquid” than many common investments.

Make sure you understand what type of risk is associated with every investment you own. And try to avoid “overloading” your portfolio with too many investments with the same type of risks. Doing so will not result in a totally smooth journey through the investment world — but it may help eliminate some of the “bumps” along the way.

• Michael Allen is a financial planner at Edward Jones in Silverdale.

Roth IRA: For retirement… and beyond

By Anji Sell If you’re somewhat familiar with investing, you may know that the Roth IRA is a great retirement savings vehicle. But are you aware that some of its benefits can also pay off for the next generation of your family?

To understand why this is so, it’s necessary to be familiar with a Roth IRA’s features. For starters, when you contribute to a Roth IRA, your earnings have the potential to grow tax-free, provided you don’t start taking withdrawals until you’re 59½ and you’ve had your account at least five years. The amounts you contributed aren’t taxed when withdrawn because you’ve already paid taxes on the money you put in. And the potential for tax-free earnings can continue even when your beneficiaries inherit your Roth IRA, though you’ll need to consult with your tax advisor on this issue.

A Roth IRA also offers other features that can help you build resources for retirement while possibly helping your surviving family members. For one thing, you can contribute to your Roth IRA for as long as you have some earned income, up to the contribution limits, and as long as you meet certain income limitations. Even if you’ve officially “retired,” you might do some consulting or part-time Roth IRA, page 29

YOU CAN’T CONTROL 28 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

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How a millionaire can pay zero federal income tax in retirement

By Jason R. Parker Did you know that Roth IRA income is not used to calculate the amount of your Social Security income the federal government will tax. This is great news! If you are not a tax professional, then you may not know why this is important, so I'll give you just a quick overview.

The amount of income you have will determine how much of your Social Security benefit is taxable. The federal government will tax anywhere from 0 to 85 percent of your Social Security benefits based upon a formula used for determining

your provisional income. Income sources include, but are not limited to, pension income, taxable interest income, traditional IRA distributions, half of your Social Security benefits and even tax-free income from municipal bonds.

Here is a quick simplified example. Let's say you and your wife are both 66 years old.

You have no pension income, and your only guaranteed income source in retirement is your Social Security. Between the two of you that totals $3,500 per month. As a couple you also have $2 million in your Roth IRA earning a fixed rate of 3 percent per year.

In this example, you would have $42,000 per year of Social Security income.

And let's assume that you just draw the interest from your Roth every year without touching your principal. So you would have an additional $60,000 per year of taxfree Roth income. Under this scenario you would have a cash flow of $102,000 per year, none of your Social Security benefits would be taxed, and you would pay zero dollars in federal income tax.

Now let's assume that instead of having a Roth IRA your $2 million is in traditional IRAs. If everything else is exactly as described above, then 85 percent of your Social Security benefits would now be taxable, and after your standard deduction and personal exemptions, you would pay approximately $10,856 in federal income

ROTH IRA

possible, you’ll potentially have more money available for a variety of options – one of which may involve leaving sums to your beneficiaries. Your non-spouse beneficiaries must take annual required minimum distributions, but they have the option to take the distributions over their lifetime.

Keep in mind, though, that your Roth IRA is part of your estate for purposes of federal estate taxes. In 2012, your estate would be subject to these taxes if it was worth more than $5.12 million (or less, if you made certain gifts). In 2013, however, this amount is scheduled to drop to $1 million unless Congress acts on this issue.

(Some states also have estate taxes that apply at amounts less than the federal

amount.) In any case, if you have a sizable estate, you should consult with your tax and legal advisors.

When you invest in a Roth IRA, your goal, first and foremost, is to help fund your retirement. In fact, basically all your decisions regarding your Roth IRA – how much to contribute, where to invest the money and when to begin taking withdrawals — should be based on your own retirement goals. However, as a side benefit to investing in a Roth IRA, you may find that you could help out the next generation, or two, of your family.

• Anji Sell is a financial planner with Edward Jones in Silverdale.

from page 28 work. So you could put some of your earnings into your Roth IRA. This ability to keep funding your Roth IRA virtually indefinitely can give you more flexibility in managing your retirement income – and, depending on how you do manage that income and what your other objectives may be, you may also end up with more money that could be left to your beneficiaries.

Also, unlike a traditional IRA or a 401(k), a Roth IRA does not require you to start taking minimum distributions at age 70½. In fact, you are never required to withdraw money from your Roth IRA. And by leaving your account intact for as long as

tax. So even though you still have $102,000 of income, you only get to keep $91,077.

The fact that Roth IRA income is not included in the taxation of your Social Security benefits is just one more great reason why you should consider converting some or all of your traditional IRAs to Roth IRAs. The fact that marginal income tax rates are currently at all-time historical lows and that tax rates are set to go up automatically at the end of this year should be a compelling reason to sit down with a team of experts to help you determine if a strategic IRA to Roth IRA conversion is a good idea or not.

Editor’s note: Article provided by Jason Parker, president of Parker Financial LLC, a fee-based registered investment advisory firm specializing in wealth management for retirees. His office is located in Silverdale. The opinions and information voiced in this material are not intended to provide specific advice or recommendations for any individual, and do not constitute a solicitation for any securities or insurance products. All information is believed to be from reliable sources; however, no representation is made as to its completeness or accuracy. Please consult your trusted professional for advice and further information. Jason Parker is insurancelicensed and offers annuities, life and longterm care insurance as well as investment services.

Kitsap CASH program suspended until replacement funding is secured it’s approved the funds would not be available until 2013.

“The challenge is how do we maintain these business development training classes, which are consistently filled up,” said Bill Hoke, a business and marketing consultant who’s an instructor for the Kitsap classes and was “really disappointed” to hear the program is being suspended.

Hoke and Walton said they were encouraged that a group of a people who previously completed the CASH training decided to continue their support group meetings, splitting the cost among themselves to rent space in Bremerton.

“These are people who are really motivated,” Walton said. “They get together every two weeks, for advanced workshops or other training, and to provide support for each other.

Walton estimated that entrepreneurs who went through the CASH program in the past year have started businesses that now employ about 30 people.

Those who sign up for the business training “are really people in the unemployed/underemployed area,” Walton said, “who have had the kind of job in the past that’s disappeared and is not coming back in America due to structural change in the economy.”support

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 29

The Washington Community Alliance for Self-Help has suspended its Kitsap operations for at least the rest of this year after the nonprofit’s grant funding was cut drastically.

Known as the CASH program, it provides business training classes, mentoring and ongoing support groups for entrepreneurs who are trying to start their own business. The program is geared toward helping lower-income people who may have lost jobs or struggled to find suitable employment during the economic downturn.

“The Kitsap program is grantdependent, and our grant got reduced essentially from $80,000 to $20,000 for this calendar year,” said Stuart Walton, director of the Kitsap program. “The whole (CASH) organization lost other grants, too, so they had to start taking a real hard look at staff and programs.”

The Kitsap program, which has operated since 1999, expanded this summer and offered the eight-week CASH training classes for the first time in Mason County.

“That was very successful; we had a great class of entrepreneurs there,” said Walton, who has worked in the program for six and a half years.

He said an application for another grant will be reviewed in September, although if

30 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

Technology is making you sick — Here's the cure New Yorker, the cover shows a family posing for a picture, but they are all looking down at their own smart phones texting. Unfortunately, many people are getting more comfortable living in the virtual world than in the physical one.

Feeling that phantom ring. Even when not carrying phones, many people feel a vibration in their pockets. It has become so prevalent that it is a medically documented condition. We now live in such an interruption-based culture from constant texting to social media notifications, that many of us actually seek these interruptions as comfort while trying to focus on our daily work.

Multitasking more, accomplishing less. While multitasking does allow us to get more done, it also does not improve the quality of the results. Dr. Rosen says that when technology is added into this mix, the brain gets over stimulated. He describes research from brain scans showing that, "When you use technology, it over-activates your brain. If you keep your brain overly active all the time, it wants to switch back and forth from one task to the next just to make sure it’s not missing out on anything.” The more you multitask, the more your brains wants to do it again and again.

There's a Cure for That If you do have some of the symptoms mentioned above and worry that your smart phone is controlling your brain, read on to find some simple ways to free yourself from its hold.

Calm your brain. In order to overcome this addiction, Dr. Rosen suggests finding ways to “calm your brain” every few hours. He suggests activities such as walking outside and looking at nature.

“All it takes is about 10 to 15 minutes every couple hours to reset your brain. So exercising, doing jumping jacks, even playing a video game helps. Talking to a human being as long as you’re talking

Entrepreneur offers mobile service providing office support Office Expert, owned and operated by Barbara Treick of Allyn, has announed the opening of mobile administrative and bookkeeping support service aimed at regional small and home businesses.

She is the first graduate in the Washington CASH micro-enterprise program in Mason County to announce a new business opening.

Office Expert allows clients to remain focused on their core business.

Treick brings her small business knowledge and two decades of Barbara Treick experience in all back office functions, including Excel, Quicken, QuickBooks, office organization, invoicing, data entry, payroll, word processing, and office management.

"We can step in and do what needs to be done, or provide scheduled services," Treick Treick graduated Aug. 9 from the Community Alliance for Self-Help (CASH) business development training class, where she developed her business idea and was supported by other entrepreneurs and volunteer coaches.

For more information or to make an appointment, call 360-801-5886 or email btreick@msn.com.

either on the phone or face-to-face and as long as it’s a fairly positive conversation works, too.” The key is to find out what is personally effective for you.

Practice technology breaks. Dr. Rosen suggests that instead of taking a break from technology, let technology be the break.

“What we’re doing, particularly in classrooms, is effectively allowing students to have their smartphones, but then we have the teachers say, 'Okay everybody, you’ve got one minute to look at your phone. Everybody look at their phone, turn it on silent, turn it upside

down, put it in front of you on your desk.”

This same technique can be used in business meetings so attendees aren’t worrying they will miss something since there is a scheduled time to check in with their e-mail or other social media feeds.

Teach yourself to disconnect. This is not easy, especially on the weekends or while on vacation. Dr. Rosen suggests to start slowly. During your regular business day, try being disconnected for an hour for the first week. Then, expand it to two hours. Setting clear and consistent boundaries can relieve anxiety.

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September 2012 Kitsap Peninsula Business Journal • KPBJ.com 31

Barry Moltz, OpenForum.com When the power went out this summer in Chicago, my first thought was not “Will the food spoil in the freezer?” It was to check and see whether my iPad was fully charged. I immediately obsessed about how I could access the Internet if the blackout lasted for an extended period of time.

These are not unusual thoughts in the age of the “always-on” technology.

Through the Internet, we can access information almost anywhere and anytime we want. But, Professor Larry Rosen, who studies the psychology of technology, explains in his new book, iDisorder: Understanding Our Obsession with Technology and Overcoming Its Hold on Us, that this has become an increasing psychological disorder among the general population.

Spotting the Symptoms In my interview with Dr. Rosen, he described how to recognize the symptoms of a technology addiction. See if you find yourself identifying with any of the following behaviors described below.

Always being “connected.” Dr. Rosen points to the most common problem: the need to “check in” with the world all the time. "I don’t mean our physical world—calling our kids, calling our parents," he says. "I mean our virtual world, even when we are in the company of other people. We do this because we think we are going to miss something.”

MTV has called this F.O.M.O., or fear of missing out. This is very prevalent in the business world with the constant flood of information.

Creeping anxiety. There is a sense that business is moving so fast, if we do not respond immediately, we will be left behind. We check our phones to reduce this anxiety. Dr. Rosen says that people check their phones everywhere including "bathrooms, churches and movie theatres.” In fact, in a July issue of The

Red Cross focuses on National Preparedness Month

32 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

September is National Preparedness Month and the American Red Cross is encouraging all businesses and nonprofit organizations to make sure they are ready for the next emergency or disaster.

When a disaster hits, there is a lot at stake for businesses and nonprofit organizations.

Research shows that an estimated 25 percent of all businesses that close following a major disaster never reopen (Institute for Business and Home Safety).

The Red Cross is encouraging businesses and nonprofit organizations to take a few simple and relatively inexpensive steps to help ensure

their business is up and running in the wake of a flood, windstorm or other natural disaster.

Businesses should encourage their employees to be prepared at home. This often overlooked step is critical, according to Karen McKay Bevers, West Sound Director for The American Red Cross Serving King & Kitsap Counties.

“It won’t matter if your company’s building is unscathed or that you personally made it into the office. If your employees’ homes or families have been affected or if their route to work has been disrupted, they will most likely miss work — possibly a lot of work,” she said.

Businesses should make sure that all employees have disaster kits at home and at work with enough food, water, medicine and other necessities for a minimum of three days.

Each employee should also have an emergency communications plan, so that they can talk with family members and employers. In the event that local phone systems become overloaded, and they often are, employees should have an out-of-state contact that they can call or text with updates. In case of a power outage, having a back-up generator, a hand-cranked cell phone charger or even a walkie-talkie will help keep employees connected to the outside world.

Communication plans are also vital for businesses. The Red Cross suggests that business leaders have access to updated emergency contact information for all employees. For organizations with a large staff, a phone tree can be helpful to disseminate critical information. Businesses should consider connecting phone systems to a back-up power supply, and should consider using text messaging and social media to keep customers, vendors and suppliers informed of business closures or operational changes. Businesses should determine ahead of time who the key decision-makers are and which staff are responsible for implementing various communications procedures.

Businesses should also take precautions now to keep employees safe. Employers should determine evacuation routes and employee assembly areas as well as practice evacuation drills. All organizations should have extra water, food and emergency supplies on hand in case employees cannot evacuate and they need to shelter-in-place.

“Everyone — including businesses — must be prepared to take care of themselves, their employees, and their neighbors in an emergency,” McKay Bevers sais. “No one can predict where or when disasters will strike, but preparedness steps taken today can save lives tomorrow.”

Other Ways to Get Ready The Red Cross has a range of different programs to help families, businesses, schools and communities be prepared.

• Be Red Cross Ready is an online, interactive training program that teaches people how to be ready for emergencies.

• Red Cross Ready Rating™ is a free, web-based program that helps businesses, schools and other organizations better prepare for emergencies.

• Ready When the Time Comes trains employees from corporations and mobilizes them as a community-based volunteer force when disaster strikes.

• A family disaster plan template is available on the Red Cross website that people can download and complete to make or update their plan.

• Red Cross First Aid and CPR/AED training courses provide participants with the knowledge and skills to respond to emergencies in case advanced medical help is delayed.

Information on these programs, and additional resources and information on preparedness can be found on redcross.org and on the Kitsap County Department of Emergency Management website at www.kitsapdem.org For more information about getting your employees and businesses prepared, or to schedule a disaster preparedness workshop for your business or nonprofit group, visit www.redcross.org/seattle or call the West Sound Red Cross office in Bremerton at 360-377-3761.

• The American Red Cross is a not-forprofit organization that depends on volunteers and the generosity of the American public to perform its mission. For more information, please visit redcross.org or join our blog at http://blog.redcross.org.

Kitsap’s 22nd annual Sinclair Coastweeks Cleanup

By Kathleen Byrne-Barrantes Begun in the United States, Coastweeks recognition has spread throughout the world as an international event celebrating the beauty and vitality of our coasts and coastal communities. Organizations and individuals celebrate a month of environmentally proactive activities each year — from nature walks and coastal cleanups to boating events — to explore and help preserve fragile coastal resources.

The Sinclair Inlet volunteers have been supported in 21 previous cleanups coordinated by the Kitsap Trees & Shoreline Association (KiTSA) and Kitsap Diving Association (KDA). Each September during the annual Coastweeks Cleanup they have removed trash and debris from the beaches and waterways, identified the sources of that debris, and educated others in an attempt to change the behaviors that allow it to reach there in the first place.

Over the past 25 years, Ocean Conservancy’s (OC) International Coastal Cleanup (www.coastalcleanup.org) has become the world’s largest volunteer effort for ocean health. Nearly 9 million volunteers from 152 countries and locations have cleaned 145 million pounds of trash from the shores of lakes, streams, rivers and the ocean on just one day each year. Volunteers in the event’s global network not only pick up trash,

they record items found on standardized data cards, allowing OC to compile and analyze data each year. The OC then publishes the world’s only item-by-item, location-bylocation snapshot of marine debris in its annual report.

Many walk, while others set out on boats.

Thousands more don scuba gear to seek trash below the water’s surface. They have recorded every item found, giving the OC a clear picture of the manufactured items impacting the health of humans, wildlife and economies. As their 2011 report (http://act.oceanconservancy.org/ pdf/Marine_Debris_2011_Report_OC.pdf

Now you can take part in the 27th annual international coastal cleanup by signing up through the website at http://www.signuptocleanup.org/ for an event near you. Volunteers can search for a location instantly, either by entering information like an address or town or by clicking any place on a world map. Cleanup sites in the area will instantly pop up so you can make the most convenient land, watercraft or underwater selection. If you don't see a cleanup scheduled in your area, or if you want to schedule one on another date, you may propose one. With a few keystrokes, you will find out all you need to know and officially

Annapolis-Ferry-Terminal.

Downtown Bremerton: near Waterfront Harborside boardwalk, marina parking area in front of the port bathrooms/pumphouse building and near the Hampton Inn parking garage turnaround area at 150 Washington Ave., Bremerton, 98337. Approximate GPS Coordinates: latitude 47°-33.702’N, longitude 123° - 37.337’W Call John Denis (360-871-2571) for more information …and join these dedicated volunteers to make our piece of the world a little clearer a little cleaner and a little greener for us all to enjoy!

"People protect what they love. All of you love the sea... Help us protect her." ~ Jacques Yves Cousteau ) demonstrates, the body of data from the International Coastal Cleanup has inspired action to rid the ocean of harmful trash. By understanding what is out there, we can work together on solutions.

Many of our local divers have dedicated countless volunteer dives to removing debris and artifacts from the bottom of Sinclair Inlet, Port Orchard Bay and the Hood Canal. Without question, the actions of divers have had and will continue to have a beneficial effect on both marine education and protection of aquatic life. While threats to underwater environs are indeed attributed to pollution, derelict fishing gear, and overfishing, the biggest threat to the marine habitat is people's ignorance about them.

become part of the cleanup.

Or, you can join the local efforts taking place on Sept. 15 from 11 a.m. to 2 p.m., meeting at the Annapolis Dock (underwater cleanup for certified scuba divers) in Port Orchard and along the State Route 166 shoreline or in downtown Bremerton near the Waterfront Harborside boardwalk in the marina parking area.

John Denis, longtime coordinator of the Port Orchard volunteers, has provided the exact locations for the two meeting sites as follows: Port Orchard: Annapolis ferry dock kiosk, near shoreline SR 166 Port Orchard, 98366.

Approximate GPS coordinates: latitude 47°54.762’N, longitude 122° - 61.627’W http://wikimapia.org/1970480/

Kitsap County to remove old bulkhead and restore beach near fairgrounds Beach Watcher volunteers have participated in pre-bulkhead monitoring to collect valuable information on the state of the beach. The efforts of these citizens will help to track ecological and physical changes

over the years following bulkhead removal.

Shoreline access to the park is closed during the restoration. For more information, call project coordinator Christina Kereki at 360-337-5777.

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 33

A weeklong construction project was scheduled to begin Aug. 27 to remove a 650foot long, dilapidated bulkhead on the shoreline of Anna Smith Children’s Park, near the Kitsap County Fairgrounds.

Kitsap County’s Department of Community Development and Parks and Recreation Department have teamed together to use federal Environmental Protection Ageny grant funds to remove the old seawall, improve shoreline access and safety, and restore the natural conditions of the shoreline.

“This project helps us get rid of an old bulkhead and demonstrates to the public how a shoreline can be restored,” said Dori Leckner, county parks superintendent. “It would be more expensive to rebuild, and this project shows us that a bulkhead is of no use in preventing erosion here anyway.”

The project studied all Kitsap County shorelines and Anna Smith Park was shown as an important area for sediment source contribution to the nearshore.

The bulkhead removal project is part of a larger Kitsap Regional Shoreline Restoration Project funded by the EPA Watershed Assistance Program. Bulkheads and seawalls often trap natural sediment contributions to beaches and can impact salmon feeding areas and forage fish spawning grounds. When bulkheads aren’t protecting structures, their removal can help restore shoreline functions.

Hyundai Veloster: Unique, fun and frugal

34 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

By Bruce Caldwell The new for 2012 Hyundai Veloster stands out in a crowd for several reasons: unique styling (it’s a 3-door sport hatchback), excellent fuel economy, affordable pricing, versatility, and fun to drive personality. In a world full of copycat cars the Hyundai Veloster dares to be different and succeeds. There are unique cars with minimal functionality, but the Veloster works both as a styling statement and sensible transportation.

The Hyundai Veloster value proposition is strong. Our tester had a list price just over $17,000, but two $2,000 option packages plus freight charges nudged the total past $22,000. We could do without the Tech Package (navigation system, backup camera, etc.), but we’d keep the Style Package (great panoramic sunroof, premium audio system, and various interior upgrades). Regardless of how it’s configured, the Veloster is a great deal.

Walkaround: You won’t have any trouble finding a Veloster in a crowded parking lot. The car is a blend of coupe and sedan. It looks coupe-like on the driver’s side with its single door and more sedanlike on the passenger side with its normal front door and smaller rear door. All doors are front-hinged, unlike some 3-door

compact pickups that have a rear-hinged back door. The third door has to fit around the rear wheel well, but it’s workable.

The car’s profile is low and pretty sleek.

The wheels are pushed toward the outer corners, which enhances the low look. Our tester had the $2,000 optional Style Package that included handsome 18-inch alloy wheels and P215/40R-18 tires. The flat face wheels look great, but they’re susceptible to curb rash.

A major component of the Style Package is the great panoramic sunroof.

The massive glass roof greatly brightens the interior. There is a power shade to help keep the interior cool. The actual sunroof opening is on the small side, but it works well thanks to a nice wind deflector.

Interior: The interior is very spacious for the driver and front seat passenger.

Legroom was so extensive that we had to move the seat up in order to work the clutch and we’re 6-2. The panoramic sunroof crowds headroom a little, but a seat height pump helps drivers find an ideal position.

The supportive seats were nicely contoured, as was the thick steering wheel.

A tilt/telescopic steering column further eases the task of finding a perfect driving position. The front doors have unique,

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oversized door pulls, which are great for closing the wide doors.

Interior storage bins are ample.

Lots of stainless trim and contrasting colors make the interior as bold as the exterior. The look fits the car’s personality. Material quality and execution is very good.

Overall cargo capacity is ample for a relatively small vehicle, but the space isn’t super easy to access. The split rear seats don’t fold completely flat and there is a noticeable height difference between the seat backs and trunk floor. The hatch opening is big, but the wide cargo area is restrictive for tall objects. The rear lift over is quite high. A lot of soft cargo can be accommodated, but tall, rigid boxes pose a challenge.

In keeping with the car’s high-tech styling, the interior was loaded with stateof-the-art electronics and info/entertainment/communications features, including Hyundai’s Blue Link Telematics System (it requires a subscription after the 90-day free introduction).

Under The Hood: Our tester was a 2012 model, which was only offered with a 1.6-liter DOHC 4-cylinder engine rated at 138 horsepower and 123 lb-ft of torque.

The smooth 6-speed manual transmission helped make the most of the modest horsepower and also contributed to an impressive EPA fuel economy rating of 28 mpg city/40 mpg highway.

The big news for 2013 is the availability of a new turbocharged and intercooled engine that produces 201 horsepower and 195 lb-ft of torque from the same 1.6-liter 4-cylinder powerplant. The turbo engine is available with either the 6-speed manual transmission or a 6-speed automatic with manual shifting capabilities. The turbo engine is more in keeping with the car’s swoopy styling.

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Behind The Wheel: The ride quality was quite good. It’s a good blend of sporty and comfortable. Despite its styling the Veloster isn’t a hardcore sports car. That’s fine for most buyers. It’s sporty enough to be fun, but not so responsive as to be harsh.

The freeway ride is generally smooth, but big expansion strips and potholes can be felt. The build quality is solid and sound insulation is decent. At high rpms the standard engine lets you know how hard it’s working. Otherwise, things are reasonably quiet. The excellent sound system is a big plus.

The driving experience is tied to one’s attitude. If you consider the Veloster a versatile, four-passenger economy car it exceeds category expectations, but if you’re looking for a sports car experience the 2013 turbocharged engine is a must.

Whines: The hatchback design and the rear seat headrests hamper rearward vision, although the backup camera helped a lot.

The rear seat is best for children or short, flexible adults.

Bottom Line: We liked the Hyundai Veloster a lot. Unique styling and an overall sporty attitude pushed the Veloster well up the fun scale. Fuel economy that can hit the magic 40-mpg mark and prices in the very low twenties (high teens without the two $2,000 option packages or the new turbo engine) seal the deal. The Hyundai Veloster proves that practicality doesn’t have to be boring.

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All-new 2013 Buick Regal one great driving car Standard audio is a 7-speaker, AM/FM/Sirius XM (threemonth courtesy subscription) stereo with single CD/DVD player, MP3 player, auxiliary input jack, and iPod/USB port.

The available SiriusXM Travel Link feature (subscription required) includes fuel locations with pricing information, weather infor¬mation and movie theater locations.

Optional is a harman/kardon 336-watt, 5.1 Matrix Surround Sound, 9-speaker system.

Also standard with both audio systems is Buick’s IntelliLink system, which uses Bluetooth or USB to connect the driver’s smartphone to the radio display via the screen. IntelliLink allows smartphone control via voice activation and steering wheelmounted controls. The standard Radio Data System (RDS) also enables streaming stereo from the phone through Internet radio services such as Pandora and Stitcher.

White-on-black buttons on the center stack handle audio, car, and navigation chores, with dual temperature climate controls below, and redundant controls on the sporty steering wheel. Chrome trim abounds, framing the shifter, gauges and rotary dash controls.

The 14.2 cubic foot trunk is fairly long and offers moderate lift-to-load and unload dimensions, securing points, and flat sidewalls. The 60/40 split rear seat folds down with a lockable pass-through in the armrest.

Safety features include six airbags standard with rear-seat side-impact airbags optional, as is GM’s Electronic Stability Control.

Under The Hood: There is one basic powerplant, with three configurations, and two transmission choices. Our test vehicle was equipped with GM’s standard 2.4-liter, DOHC, four-banger with eAssist, that puts 182 horses to the highway, with 172 poundfeet of torque, and married to a six-speed automatic — the only transmission with this engine. The eAssist system uses power stored in the lithium-ion battery to provide needed electrical boost in various driving situations and enables regenerative braking capability, optimizing engine and transmission operation. Fuel economy is rated at 25/city and 36/highway.

There’s an optional Eco-Tec 220-horse turbocharged, direct-injected 2-liter, that delivers 260 pound-feet of torque, and a high-output turbo version that puts down 270 horses and 295 pound-feet of torque.

Both are available with either a 6-speed stick or automatic.

Behind The Wheel: We found the Regal very quiet, with a nice, smooth highway ride. In fact, it may be the quietest car in its class. A bad road surface will transmit some noise however, and we noticed some slight wind noise from behind at speed. But even with the engine pushing hard, it’s little more than

background noise, with no audible hint it’s even working hard.

The Regal has a very solid feel, and driving it hard at freeway speeds offered comfort and quiet. The steering provides good feedback, feel and directional stability, and the brakes are certainly up to the challenge. Both the gas and brake pedals are engineered to require some foot travel before you get into heavy braking or kick-down acceleration, rather than the instant bite of a sports sedan. And while it’s not a true sports sedan, like some of its competitors — namely the Acura TSX,

Audi A4, Mazda 6, VW Passat, Volvo S60, and Lexus ES — it’s pretty close.

Whines: While the Regal is more than adequate around town or on the freeway, the standard 2.4 could be pushing it passing a truck on a two-lane blacktop or climbing a mountain grade.

Bottom Line: The Buick Regal offers a stylish alternative to the entry-premium midsize sedan segment, delivering visual appeal, soothing quiet, smooth ride, easily deciphered features, comfort and economy conducive to long drives — and a better than average warranty.

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September 2012 Kitsap Peninsula Business Journal • KPBJ.com 35

By Lary Coppola Buick revived the mid-size Regal nameplate sedan for the 2011 model year, basing it on the same platform as General Motors’ (GM) German sibling, the Opel Insignia, which won major awards when it debuted in Europe.

Shorter than the popular LaCrosse, the Regal is basically a four-passenger car that could accommodate a rear-center child seat if necessary. The leather interior reminded us of the Acura TSX, in that’s it’s a nice mix of sport and luxury.

The Regal comes in five trim levels — the base Regal (1SL), Premium I (1SN), Premium II (1SP), Premium III (1SR) and GS (1SX). With four option packages (including GS) that allows buyers a fairly high degree of personalization.

Walkaround: Following the lead of manufacturers such as Nissan/Infiniti, Honda/Acura, Toyota/Lexus, Volvo and others, GM designed the Regal as a world car built for sales in numerous international markets. It shares all its body panels with the aforementioned Insignia, and bears the signature sloping roofline of today’s contemporary sedans. It’s visually extended by the edge of the rear lamp housings and a short trunk lid with a subtle lip spoiler. A simple character line sweeps down and back behind the front wheel and carries through the rear door. There’s no lower edge trim but textured paint protection does minimize stone chips.

Side chrome is limited to the window surrounds and a front fender-mounted turn indicator. However, both ends have their share of brightwork. The nose showcases the prominent waterfall grille framed by lamp clusters. A large chrome spear anchors a big, truck-mounted Buick crest, and the sweep of the lamps mirror the LaCrosse.

There are also three new color choices for 2013 — Black Diamond Tricoat, Champagne Silver Metallic, and Graphic Blue Metallic.

Interior: With leather standard, even the base model offers a welcoming interior that’s comfortable and quiet, with its character seemingly changing with the chosen color scheme.

Both our test vehicle’s front seats featured 8-ways with a 4-way lumbar support. Long-term support was good — especially traveling — but the lack of lateral support and softness shows the seats are clearly meant for comfort rather than performance driving.

The rear seats are comfortable for occupants under 6 feet. The sloping roofline limits rear headroom — a problem the smaller VW Passat and larger Mazda6 don’t have.

Instrumentation has the computer/message center situated between a watch-dial-like speedometer and tach, underneath numerical fuel and coolant gauges, which are illuminated in GM’s signature ice blue. GPS Navigation is standard on all models and the 7-inch highresolution, full-color touch screen sits top center offering excellent line-of-sight viewing.

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36 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

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Politics & social media: Danger zone for business

By Dan Weedin It’s September and we are heading down the backstretch of this political season. For business people, this means you are entering a danger zone.

Fear not, I am NOT the political pundit this month. Far from it. But, I am here to warn you of the dangers of “mouthing off” with a click of a “post.” The consequences could cost you business.

Let me preface by saying that I have no problem with business people supporting a candidate or a cause. You have every right to voice your opinion and advocate whatever positions you like. That doesn’t mean you should be a social media bully.

In an era where Facebook and Twitter send your sound bytes viral in milliseconds, you may find yourself wishing you could turn back time and control your finger. Your clients and prospects may solely be on Facebook for fun. In fact, the odds say that they are.

With that in mind, I present to you Dan’s 10 Rules for Surviving the Political Season: Tip #1 — Proofread your posts. Don’t write your last line; click send; and walk away feeling triumphant. You probably aren’t. If you’re angry or agitated, you probably wrote something you shouldn’t have.

Tip #2 — Avoid “fighting words.” It never ceases to amaze me what people will say when they don’t have to say it to your face. Case study — I had a “friend” write on a Facebook post that people with a certain line of thinking were “knuckle draggers and crack pots.” This was the husband of someone I sent business to! If you’re using verbiage like this to attract attention, be careful what attention you will get.

Tip #3 — Avoid using “labels.” Liberals, Democrats, Conservatives, Republicans, Tea Partiers, whatever. By lumping them all together, you may include people you don’t want to. Some of those may even be your clients! Many Facebook “posters” are notorious for lumping in outliers by enlarging their demographics through generalities.

Tip #4 — Don’t enter into a war of words online. I’ve been guilty of this myself. No good can come from it. Either back off, or pick up the phone and call. If you don’t know the person well enough to call, then why do you even care?

Tip #5 — Beware of Pinterest. I know it’s the new hot craze. You can’t go through Facebook without seeing a gazillion posters (90 percent are absurd, based on my personal scientific study). When you start posting these things, people will assume you are fully supportive of the meaning. The problem is that the meaning may not be all so clear.

Tip #6 — Don’t take things personally.

People have different opinions. It’s still okay to have them as friends or do business with them. There is a direct correlation where the less fighting words are used, the less likely someone will take something personally. Just saying…

Tip #7 — Don’t be angry. Anger usually leads to rash judgments, vitriolic posts and hurt feelings. Do you really want to hurt your potential customers’ (as well as current customers’) feelings? Anger tends to subside quickly; hurt feelings not so much.

Tip #8 — Be open to learn. When positions are cited without rancor or meanspiritedness, I feel I can actually learn something new. I may not ultimately agree, but I am happy for the discourse and opportunity to grow.

Tip #9 — Have some perspective. These elections will all be over in a few months and

the winners and losers will all go their own ways. Your words may linger on forever with those who read them.

Tip #10 — Don’t engage in political debate on social media. This will save you from yourself. Social media has the ability to take your position, inflate it past what it really is, attach a really mean voice, and shout it to the world. If you’re in business, the only thing you want shouted to the world is how you can help them, not whether you favor donkeys or elephants!

Bonus — A really large majority of Facebook “posters” aren’t in business. They have nothing to lose. They can break all my rules and be no worse for wear. If you get into battles with them, your posts are available for all your community to see (you knew that, right?). You may be slinging mud at your brother-in-law in Hoboken, but your best client may read it.

I’m not perfect. I’ve broken a few of my rules over the years (how do you think I thought of them?). I can tell you that as things get heated up, I will keep my opinions off the Facebook news feed. You and I may chat about them over a cold beer, but you won’t be “liking” or seething from them online.

My recommendation to you as a business professional is that you adhere to my rules, focus on building your business, and dodge the mud!

• Dan Weedin is a Poulsbo-based management consultant, speaker and mentor.

He leads an executive peer-to-peer group in Kitsap County where he helps executives improve personally, professionally and organizationally by enhancing leadership skills. He is one of only 35 consultants in the world to be accredited as an Alan Weiss Master Mentor. You can reach Dan at 360697-1058; email at dan@danweedin.com or visit his website at www.DanWeedin.com.

A crossroads community in transition North Kitsap.

Since January, our team of economic developers has literally covered the economic waterfront in Kitsap County — all 254 miles of it. And, we have also drilled down into specific industry initiatives such as the launch of the Kitsap Aerospace and Defense Alliance, as well as a continued focus on connecting local businesses to contracting opportunities with the Department of Defense — the backbone of the West Sound economy and one of the three pillars of the Central Puget Sound Economy.

Sometimes it’s beneficial to focus economic development analysis and planning on a particular sub-regional, geo-political area such as South Kitsap, or Central Kitsap, or North Kitsap (much like the way that Kitsap County is apportioned for districts relative to the Kitsap County Commission), rather

WARNING

teachings about money."

Speaking of money, according to Reed's website his fees start at $5,000 for a threehour workshop, so that brings up another question for the mayor.

• How did you get a break on the fee paid to Reed for training your folks in public relations? Is he a friend of yours?

(Reed's website says he has experience building aircraft carriers, and Matthes had a career working in the shipyard, so are there possibly some dots that connect here? Or maybe Matthes just found him by doing a Google search for "Financial adviser who peddles Scripture-based guidance and can teach PR.") • Why didn’t you participate in the PR training that you required for the professionals in charge of Port Orchard's law enforcement, finance, community development and public works?

And as Columbo would say, "Oh, just one more thing..."

• Does the savvy PR guy you hired for this training recommend a strategy of refusing to talk to any reporter who writes something you don't like, after you've warned him to back off?

from page 38 • Why did you hire Frank Reed and pay him $3,000 to conduct the PR training?

What are his qualifications, experience or expertise in this area?

Reed is a self-employed financial adviser in Bremerton and since 2006 has owned a business called Judah Investments. His website, BottomLineMinistries.com, trumpets the message "Debt Is NOT Your Destiny!" and his mission statement is: "To save the lost through the teaching and preaching of the Word; to destroy the works of the Devil through the power of the Word; and to teach people how to have life abundantly through obedience to the Word."

So he's big on the Word, although there's nary a word on his website about any PR work he's ever done, nor about any specific company he's worked for or jobs he's held, or colleges he attended or professional certifications he holds.

But he does tout his book, "In God We Trust, Dollars & $ense," which was published in 2009 and is available on Amazon.com. There are no reader-posted reviews on Amazon and zero clicks of the "Like" icon for Reed's book, summarized as an "easy-to-read resource on the biblical

Tim Kelly is editor of the Kitsap Peninsula Business Journal.

than merely by economic cluster or industry sector. Because much of Kitsap’s population and commerce is centered around Port Orchard, Bremerton, and Silverdale, we don’t often take the time to turn our undivided attention to the north – North Kitsap.

It’s important to remember that this sub-geographic area plays an important role in Kitsap’s economy as well. Two of the county’s four cities, Bainbridge Island and Poulsbo, are situated in North Kitsap, as is approximately onethird of the county’s population. And there are over 4,000 licensed businesses in North Kitsap including in the unincorporated areas of Keyport, Kingston, Indianola, Suquamish, Port Gamble and Hansville. And, several of Kitsap County’s larger private sector employers are headquartered in NK (Watson, Martha & Mary, PME, Avalara, Town & Country Markets, and Paladin.) So, our executive committee and planning team thought it was a good time to take a closer look at our North Kitsap’s economy — its history, its trends, its challenges, and its opportunities.

On Oct. 4, from 3 to 6 p.m., KEDA will be convening its annual fall signature event — Decision Makers II — at the Port Gamble Pavilion perched

over the entrance of the Hood Canal.

The program is entitled “North Kitsap at a Crossroads: An Economy in Transition.” It will feature a 20-year retrospective look at North Kitsap’s economic and demographic profile by Elizabeth Court, Ph.D., Washington State Labor Market Economist; as well as a panel of North Kitsap community and business leaders examining today’s economic activities and exploring trends that will shape the next generation of economic conditions and opportunities in North Kitsap. The panel’s discussions will center around clusters of economic activities that lead the way in North Kitsap’s economy today: manufacturing, health care, technology, natural resources and tourism.

This event will also feature an introduction of, and reception for, the Leadership Kitsap Class of ’13 — the next generation of community leaders who will be at the helm as the future of North Kitsap, and all of Kitsap County, unfolds over the next decade or two.

Please join us for this informative and dynamic program; and, help us shape our collective economic future — a future in transition at the crossroads of North Kitsap. You can register today online at www.kitsapeda.org.

See you in North Kitsap on Oct. 4!

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 37

By John Powers, Kitsap Economic Development Alliance From Point No Point to Olalla, and all points in between, the Kitsap Economic Development Alliance works with businesses, and partners with communities, to attract investment and create jobs throughout Kitsap County.

During this past year our alliance has delivered retention, expansion and attraction services to: advanced manufacturing businesses in the Port Orchard Industrial Park and South Kitsap Industrial Area; advanced materials, engineering, clean tech, and defense firms in Bremerton; technology companies in Silverdale, Poulsbo and Bainbridge; and medical device, manufacturing, communication, natural resource, and CNC machine shops in

Things I couldn’t say before and during the primary election

38 • Kitsap Peninsula Business Journal • KPBJ.com September 2012

As you probably know by now, I ran in the primary election for the District 2 (South Kitsap) County Commission seat.

To say I got my butt kicked would be putting it politely, coming in third out of four candidates.

After swearing I would never run for office again after losing re-election as Port Orchard Mayor by five votes in what would be graciously characterized as a “contentious” race, what changed my mind?

About two months before filing, I began getting phone calls — one or two a week at first — along with private messages on Facebook — many from people I’d never met, urging me to run for Commissioner. I was polite, but firm, saying that while I sincerely appreciated their confidence in me, I really wasn’t interested. And I meant it — I truly wasn’t.

As the filing deadline approached, the calls increased — from Democrats and Republicans alike — including past and present elected officials. Frankly, I was stunned, but remained firm.

But two last-minute calls on the last day of filing from prominent local Democrats, and a surprising conversation with my wife, tipped the scales.

The Democrats in question claimed a significant number of party members felt incumbent Charlotte Garrido was hurting the party, and they strongly believed a competent, personable Republican could beat her. I recently wrote that the conventional wisdom was since Charlotte isn’t too popular in her own district — losing it in the last general election by over 3,000 votes, but winning because of the sheer number of Democrats on Bainbridge — that if she was challenged by a credible

opponent in the primary, where only the district votes, she could be taken out. They were quick to remind me of that observation, and seemingly concurred.

They conceded a Republican would be one of the top two, and while openly admitting my qualifications as a Democrat were suspect among many party members. They also said my appeal was more LARY COPPOLA Libertarian than Republican, and The Last Word believed if I filed as a Democrat, I would attract enough business and crossover votes to beat Charlotte. Because of Bainbridge, defeating a Republican in November was a given.

Their bottom line was a moderate like me was better than a conservative Republican — and certainly better than Charlotte.

Saying I was reluctant is an understatement, However, I was idealistic enough to believe my record of solid fiscal management in Port Orchard, coupled with proven common sense leadership, would lure the moderate voters alienated by the extremists in both parties. I was solemnly promised quiet support coupled with enough funding to make up any shortfall I might face because of starting so late. None of that ever materialized, and on election night, I knew I’d been played.

People have asked why I would even run as a Democrat. Considering what they read here, many tend to view me more as a conservative Republican — especially since I’ve never been shy about supporting good Republicans like Jan Angel and Rob

McKenna.

Upon turning 18, I proudly registered as a Democrat. While certainly a staunch fiscal conservative, the truth is I’m somewhat left of center socially. I marched early to end the Viet Nam War, championed integration while growing up in the South, strongly support a woman’s right to choose, and my first media job was as a voice for organized labor.

But after more than 40 years, I’ve come to disagree with much of what the Democratic Party has evolved into. It’s moved so far left it’s no longer the one I joined, but one supporting an everbloating, more intrusive government, steadily regulating away our freedoms. The party that once stood for independent thinking, hard work, and a strong America, today stands for just the opposite under Barack Obama — who in my view has weakened us as a nation on all fronts.

His blatant disregard for our Constitution, coupled with the premeditated weakening of the military in the face of increased terrorist threats; the intentional lack of enforcement of immigration laws — including retaliation against Arizona for attempting to compel Obama’s government to enforce its constitutional mandate; as well as with targeted media lies perpetuating an ongoing economic class war supported by non-thinkers parroting party rhetoric because it’s easier than learning actual facts, has bankrupted the party of its integrity.

Using the lamestream media to relentlessly attack American business, while mobilizing the power of the federal government on the regulatory front and enlisting environmentalists as allies, Obama

has chased American jobs overseas, and increased our energy dependence — while escalating the price — and blaming Bush.

The Democrats have turned us into a nation of sheeple looking to the government for the next handout.

They pay lip service to supporting small business, while quietly undermining everything that supports its success.

Meanwhile, Obama claims you didn’t build your own business — that the government helped you. It’s the Big Lie Theory at work — repeat a lie often enough to enough Kool-Aid drinkers, and it becomes accepted as truth.

That isn’t saying the Republicans have the answer — they don’t. Or to say there aren’t good Democrats that deserve your support. Derek Kilmer is one I truly believe in. He “gets It,” about small business and where jobs come from. So does Lieutenant Governor Brad Owen. He’s a straight shooter, and someone I trust. Retiring State Auditor Brian Sonntag would have been so much more effective had the Democratically-controlled state legislature not used the budget to disembowel his office.

As I found out running for commissioner, it’s hard to win when both parties work against you. At this juncture, I have no reason for political allegiance to either party — since neither has any to me.

I will continue to work for, contribute money to, and vote for, pragmatic people I believe are honest and will do the right thing for the people they represent. I hope you will reject the Big Lie being told by both parties and the media. America’s future depends on you thinking for yourself.

Warning! Only happy news acceptable in Port Orchard He warned me.

That's what Port Orchard Mayor Tim Matthes, who obviously holds a grudge, replied when I asked if he had a few minutes to talk with me.

Our brief face-to-face encounter at City Hall reminded me that this mayor prefers not to face certain things — reality, truth, pesky reporters — that he finds unpleasant and threatening.

He walked past me with his fingers in his ears singing "la-la-la, I can't hear you!"

OK, not really, but that was essentially the attitude expressed by the mayor, who coincidentally just recently decided that public relations training would be a good idea for city staff.

I wanted to ask him some questions about that mandatory training, and about the thousands of dollars it will cost the city, and about the seemingly unqualified guy the mayor hired to lead the training.

But he was having none of that.

Matthes reminded me that late last year, when I was still editor of the Port

Orchard Independent and he was mayorelect but hadn't taken office yet, he had "warned" me that he didn't like how I was reporting the news and what I TIM KELLY was writing in the paper.

Editor’s View Moreover, he warned that if it (journalism, I guess?) continued, there would be consequences — he wouldn't talk to me anymore. And then, of course, I failed to heed his warning and indeed "did it again" the next week, the mayor recalled.

So, an interview? Fuhgeddaboudit.

But hey, no big deal. This is not about me.

It is, however, about the right of people who live, work and operate businesses in the city to know how their tax dollars are being spent.

The mayor is holding a town hall

meeting Sept. 13, and that seems like a fine time for concerned citizens to ask him to explain this PR thing.

Feel free to pose any of these questions to the guy who said during his campaign last year that city government needed more transparency: • Why do you think public relations training is necessary for all city staff, and what do you think it will accomplish?

Did any of the department heads you are requiring to take this training (the police chief, public works director, treasurer, community development director, human resources coordinator, or city clerk) request or recommend this training?

• Have there been specific instances of negative publicity for the city and its officials or employees that prompted your decision to require this PR training? Does it have anything to do with you attempting to intervene in police investigations? (I believe transparency should compel His Honor

to answer "yes" to that one, but don't hold your breath.)

• As mayor, you frequently gush in public about the wonderful job city employees do in providing service to citizens, so how is that you regard the entire city staff as lacking PR skills?

• How do you justify the expense of several thousand dollars — including considerable overtime costs to arrange for police officers to attend these sessions — for public relations training when the city is still in a budget squeeze?

And how do you reconcile this expenditure with your recent haggling with the City Council over $20 reimbursements for members attending functions held by regional economic development partners? On a related note, why didn't you inform the City Council about your plan for PR training and discuss it with them, or invite them to take part?

Warning, page 37

September 2012 Kitsap Peninsula Business Journal • KPBJ.com 39