Kitsap Peninsula Business Journal 27/03

March 2014 Vol. 27 No. 3

The Voice of Kitsap Business since 1988

Coffee Oasis opens in Port Orchard, pg 23

All decked out for spring Owners Kim Campbell and Eric Kleiva stand on the new front deck of the Port Gamble General Store & Café.

Besides adding the deck for outdoor dining, they are completing a remodel that enlarged their kitchen and will add a bar and second dining room , expanding their business to the entire first floor of the historic building.

Alternative to gas tax, pg 33

Inside Special Reports: Retirement Lifestyles, pp 8-17 Law for Business, pp 31-33 People, pg 2 Real Estate, pg 23 Human Resources, pg 28 Technology, pp 29, 30 Automotive, pp 34, 35 Editorial, pp 36-38 Home Builders Newsletter, pp 19-22

Remodel will add bar, second dining room in historic Port Gamble general store building

By Tim Kelly, Editor In one of Port Gamble's most notable historic buildings, there are two walk-in vaults built in the 19th century for the office of the timber company that owned the thriving town.

Those vaults, as heavy and sturdy as banks of that era would have had, once sat behind an imposing counter with bars across

Kite & Lightning owner Bill Hickner, right, talks with Scott Houmes at Silver City Brewery in Silverdale while checking the restaurant’s energy control panel.

the front, in the office where mill workers would come to collect their wages in silver in the early years before the company paid in script. The vaults are being repurposed and soon will be used to store wine bottles and beer kegs in a new bar at the Port Gamble General Store & Café.

Cover Story, page 4

Rodika Tollefson photo

Bainbridge tech company caters to building energy management

By Rodika Tollefson When staff at Silver City Brewery in Silverdale arrive to work in the morning, no one has to worry about going around the building to turn on lights or regulate the thermostat. Nor do they need to worry about adjusting controls or turning on air conditioning as the outside air

temperature changes. All those functions, along with others related to the kitchen and refrigeration systems, are performed automatically — thanks to an energy management system developed and installed by Bainbridge Island tech company Kite & Lightning.

Monitoring, page 14

Kitsap Bank announces promotion, employee award Kitsap Bank announced the promotion of Leslie Hays to Vice President and Training Officer.

Hays is a longtime employee, staring with Kitsap Bank in 1989. In Leslie Hays January 2006, she was promoted to Assistant Vice President.

Prior to moving into the training function in 1996 she worked in retail operations.

Hays attended the Washington Bankers Association Executive Development Program and for a number of years she has represented Kitsap Bank on the WBA Education Committee.

“Leslie’s knowledge of Kitsap Bank goes well beyond her area of responsibility, which makes her a very

capable and effective training officer,” CEO Steve Politakis said.

“She is a valuable team member and highly respected by managers, supervisors and employees.”

Cari Blossom The bank also named Cari Blossom as Employee of the

Quarter for the fourth quarter of 2013.

She joined Kitsap Bank in 2003 as a teller at the Silverdale branch, where she currently works. Blossom received the award as recognition for her friendly, positive, and caring attitude along with providing excellent service.

“Cari is known bank-wide for her outstanding customer service skills,” Kitsap Bank president and Chief Operating Officer Tony George said.

2 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Experienced nurse joins Harrison board of directors Harrison Medical Center’s newest board member is Edward Dolle, a registered nurse who has 30 years of healthcare experience at agencies throughout the region.

Dolle is currently district education and training director for Extendicare Health Services, Inc., and has Edward Dolle held leadership roles at ManorCare in Gig Harbor and the Washington State Department of Veterans Affairs at Retsil.

Dolle has filled a vacant position to complete Harrison’s 18-member board.

“Mr. Dolle brings a deep and varied background to our board,” said Scott Bosch, president and CEO of Harrison Medical Center. “As an RN, he will help provide perspective in the many ways nurses play a large and important role in the delivery of health care here at Harrison and beyond the hospital setting.”

Dolle also has served in the Navy and Marine Corps. His volunteer service has included the American Red Cross, Kitsap County Department of Emergency Management, and Washington State Nurses Association.

Mortgage lender joins new Evergreen Home Loans branch in Silverdale Evergreen Home Loans has announced that Amber Page has been hired to join the recently opened Silverdale branch as a mortgage banker. She has been in the mortgage industry since 2005.

Evergreen’s Silverdale branch is located at 2021 NW Myhre Road, Suite 112. Evergreen is a direct lender with regional offices in several Western states, and provides financing solutions for homebuyers while working locally with real estate professionals.

More information can be found at www.evergreenhomeloans.com.

Olympic College Foundation board member funds two scholarships Doña Keating, president and CEO of consulting firm Professional Options and a member of the Olympic College Foundation Board, has funded two new student scholarships.

The Student Leadership Scholarship is for

a student who is or will be attending Olympic College and who actively participates in a leadership role within a campus student organization or club and/or is significantly involved in the local community.

A Computer Information Systems (CIS) Scholarship will go to an OC student who intends to study in the field of computer information systems.

As a member of the Olympic College Foundation Awards Committee, Keating has

OC Foundation scholarship program open to online applications The Olympic College Foundation will provide over $200,000 in scholarship support to students attending Olympic College during the 2014-15 academic year. Scholarship opportunities are available to anyone interested in attending Olympic College.

Eligibility requirements for scholarships vary and are not solely based on academic achievement. The foundation whs a wide range of scholarship criteria based on program of study, career goals, community

service, leadership, and/or interests.

The Olympic College Foundation works with private donors to provide scholarship support for OC students. These scholarships are created by individuals, families, businesses and groups in the community who have a strong commitment to helping students reach their educational goals.

To be considered for any of the over 100 scholarships, applicants must fill out a

Kitsap Community Foundation accepting applications for 2014 scholarships

Founder of renamed financial advising firm earns business valuation credential Turning Point Financial, a Bainbridge Island and Seattle-based regional professional services firm, has changed its name to Soundpoint Consulting to better reflect its focus on strategic, operational and financial management services. The name change coincides with the launch of a new website (www.soundpointbusinessconsulting.com) and the accreditation of company founder Kelly Deis as a Certified Valuation Analyst.

According to Kelly Deis, “the mission and focus of the new firm, Soundpoint Consulting, will remain the same. In addition, we are broadening our service capacity in the area of business valuations.”

Deis recently completed the certification process with the National Association of Certified Valuators and Analysts to earn the Certified Kelly Deis Valuation Analyst credential. She also holds an MBA in finance from The Wharton School of the University of Pennsylvania, and a Bachelor of Science in mechanical engineering from Duke University.

The CVA credential is granted to qualified individuals with considerable professional experience in the field of business valuation.

For more information about Soundpoint Consulting’s services, contact Deis at 206-842-4922 or kelly@soundpointbusinessconsulting.com, or visit http//www.soundpointbusinessconsulting.com.

2014 KEDA Annual Meeting & Luncheon March 20, 2014 11:30 am to 1:30 pm The Baymont Inn & Suites, Bremerton PRESENTATIONS INCLUDE:

• #Kitsap – Telling Kitsap’s Story Through Social Media • KEDA Digital Ambassador Program • 2014 Economic Strategy and Review of Major Initiatives Visit our new website at kitsapeda.org to register and for information on sponsorship opportunities.

Sponsored by:

For more information and registration

www.kitsapeda.org • 360-377-9499 or contact Theresa Mangrum mangrum@kitsapeda.org

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 3

The Kitsap Community Foundation is taking online applications for its 2014 scholarships. Anyone interested will find the online application form and more information on the foundation’s website at www.kitsapfoundation.org.

Applications are being accepted until March 15 for five scholarships: Charles and Dorothy Martell Scholarship: This will be awarded to a Kitsap County high school student graduating in 2014, to help pay for tuition or costs of books, music or supplies, and help with the cost of instruments. Strong consideration will be given to participants of the Kitsap Youth Symphony, and students wishing to continue music or music education beyond high school. This scholarship is for approximately $980.

Fred and Marvel Hill Scholarship: This year’s $800 scholarship will be awarded to a graduating senior of the North Kitsap School District or a North Kitsap student with a GED equivalent accepted by an accredited college, university, trade or vocational school.

Kitsap Children’s Musical Theatre Scholarship: The KCMT Scholarship Fund will award up to three $1,000 merit-based scholarships to qualified applicants. Consideration will be given to the applicant’s strengths in one or more of the following areas: KCMT participation, KCMT leadership, community service and leadership, other performing arts activities, other outside activities, and academics.

Marie A. Barker Teaching Scholarship: Eligible applicants for this $1,000 scholarship must be full-time students attending Olympic College and accepted into the Western Washington University Woodring College of Education program. Applicants will be ranked in the following order of preference: 1) North Kitsap High School graduates enrolled in the program in Bremerton; 2) North Kitsap graduates enrolled in the program elsewhere in Washington; and 3) Other students enrolled in the program in Bremerton who demonstrate financial need and academic success.

Nova Group Scholarship Fund: The $1,000 scholarship is for students seeking a degree or certification in engineering or construction management.

If you have questions about the scholarships or the Kitsap Community Foundation, contact Kol Medina, executive director, at 360-698-3622 or kol@kitsapfoundation.org.

scholarship application that can be found online at www.TheWashBoard.org. Students are encouraged to make sure the online application is filled out and complete by the scholarship deadline date. Scholarship deadlines vary from March 2 to April 13, 2014.

For more information about scholarships, visit the Olympic College Foundation website.

seen firsthand the impact that scholarships have on the lives of students. She first approached the foundation with the idea of funding these scholarships after she attended the annual donor and scholars' dinner.

A long-time supporter of education and its link to success, Keating is a past chair of Olympic College's Business Management Advisory Committee. She wanted to continue to recognize and reward students who are pursuing lives and degrees in leadership strategy, active civic participation and technology innovation.

Her company, Professional Options, is a management consulting firm that focuses on leadership strategy, policy consulting and information technology.

4 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

from page 1 When proprietors Kim Campbell — who previously owned a flower shop across the street — and Eric Kleiva bought a small deli and ice cream shop four years ago and expanded it into the store and café, they didn't anticipate needing another expansion of their restaurant operation, which will occupy the whole first floor of the building when their remodeling project is complete.

"Honestly, I thought we would open a café that tourists would come to in the summer, and it'd be sleepy in the winter," Campbell said.

Not so much, it turned out.

On Valentine's Day, just a few days after the business reopened following a fiveweek shutdown to substantially enlarge the kitchen, the 48-seat café was bustling at mid-morning that Friday and was fully booked for dinner reservations. Since they had a waiting list, they offered their Valentine's dinner special the next night as well.

Their eatery has become such a popular spot in North Kitsap that "we couldn't handle any more business; we had to grow," Kleiva said. "We had to make the kitchen bigger."

Now that the kitchen part of the project is finished and the café is open again, the next phase is adding a bar and second dining room in the section of the building that was formerly office space for Pope Resources (and for Puget Mill Co. back in the day.)

Windows on the room’s north side will give diners a view of Hood Canal, and a new deck built on the front of the building will offer outdoor dining in the summer. There may be live music on the deck occasionally, too.

“We’re playing around with different ideas,” Campbell said. “Right now we’re just trying to accommodate more customers.”

Seating in the bar and new dining room will boost total capacity for the place to about 100, not counting seasonal space on

Coalition completes purchase of Port Gamble shoreline block for conservation Kitsap County has completed a purchase of 535 acres of forestland and 1.5 miles of shoreline on Port Gamble Bay for permanent conservation. It is the first acquisition of the multi-year Kitsap Forest

the deck.

When remodeling in the additional space is complete — and Kleiva said it will be open May 1 — they plan to keep using the current café for breakfast and have both dining areas in use during their busiest time at lunch. They’ll keep their current schedule of being open for dinner Thursday

through Sunday evenings, but utilizing the new dining room. There will be a limited food menu available in the bar until 7 p.m. on other nights.

The café has had a liquor license for serving customers beer, wine and cocktails with their meals, but the bar will add a new dimension to their establishment.

“We’ve had a service bar for over two years, but now we’re going to extend it to a full-on, belly-up-to-the-bar setup,” Campbell said, which was something they started thinking about two years ago.

Refrigeration will be added in the larger of the two old vaults, which will be filled with kegs since the bar will have 24 beers on tap, many from local and regional craft breweries. The other vault will be used for wine racks.

Another reason for expanding the operation was to have space that could be used for private parties while keeping one dining room open for regular customers.

“We’ve already booked three large rehearsal dinners for this summer, that last year we would have had to turn away,” Kleiva said.

Cambell has a penchant for working in the kitchen and said expanding it to twice its previous size allowed them to add more items on the café’s menu, which features comfort food with a Northwest flavor.

“I try to use as much local farm stuff as we can in our ingredients,” she said.

The kitchen staff also sometimes creates special dishes when a seasonal harvest mushrooms or other fare is available.

“It’s a complete from-scratch house,” Kleiva said of their restaurant. “There’s no heat-and-serve going on here.”

The Port Gamble General Store & Café has 26 employees, and the owners expect to hire at least another 10 when they open the bar and new dining room before tourism season hits full swing.

“It’s crazy here in summertime,” Kleiva said.

Visitors in summer or any season can still get hand-dipped ice cream cones at the front counter of the nostalgia-themed store, which sells a variety of gift and food items, plus wine and beer.

The historic building, which sits above the old mill site and also houses the Port Gamble Historical Museum on the lower level, has been in use as a community general store since 1916.

& Bay Project.

The Kitsap Forest & Bay Project is an ongoing effort by Kitsap County, the Port Gamble S’Klallam Tribe, the Suquamish Tribe, Forterra, Great Peninsula Conservancy, and many community partners to conserve 6,700 acres of forest and shoreline owned by Pope Resources around Port Gamble Bay. This property includes a portion of the western shoreline on Port Gamble Bay, a

culturally significant waterway that connects the Port Gamble S’Klallam people to their ancestors and the tribal village that once existed at the town of Port Gamble.

The shoreline block and and nearby forest areas are heavily used by kayakers, bird watchers, mountain bikers, equestrians and hikers seeking low-elevation, year-round access to trails. Pope Resources has allowed public access for many years, generating an enthusiastic group of volunteers who

maintain a vast trail network. Kitsap County will manage the forest land and shoreline to protect its natural heritage while providing open space for public enjoyment.

Additional funding for the purchase came from the National Coastal Wetlands Program, the Washington Wildlife and Recreation Program, the Washington State Aquatic Lands Enhancement Account, the Port Gamble S’Klallam Tribe, and private donors.

“We’ve had a service bar for over two years, but now we’re going to extend it to a full-on, belly-up-to-the-bar setup.”

— Kim Campbell, co-owner of Port Gamble General Store & Café

A walk-in vault once used to hold silver for mill workers’ pay will be the beer cooler for the new bar being built as part of the remodeling and expansion at the Port Gamble General Store & Café.

Tim Kelly photo

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March 15th

Bremerton mayor among judges for AWOB’s Crystal Star Awards The Alliance of Women Owned Businesses (AWOB) announced the selection of three regional public figures to be judges for the upcoming Crystal Star Awards honoring outstanding women business owners from Pierce, Mason, Kitsap and Thurston counties.

The AWOB awards are presented every other year to women who inspire excellence, run successful businesses, open doors and make a difference in their communities. The judges for the 2014 awards will be Bremerton Mayor Patty Lent, Jeff Rounce, publisher of the Business

Examiner in the South Sound, and Pierce County Auditor Julie Anderson.

Lent and Anderson previously served as judges for the 2012 awards. Lent, who has been a private business owner herself, said she is looking forward to the opportunity to meet the finalists that are chosen by the organization’s Crystal Star Awards committee.

This year’s award ceremony will take place at a banquet May 15 at the Fircrest Golf Club near Tacoma, and will feature awards in three categories: • The Crystal Star Award acknowledging

the outstanding role a woman has played over the years in enhancing the status of all women business owners through her creative vision, determination, success and leadership in her business and community.

• The Rising Star Award honoring a woman entrepreneur, who has owned her business for less than five years, and is already showing the persistence, tenacity and leadership to make a difference in her business and community.

• The Shining Star Award, new for 2014,

recognizing a current AWOB member and businesswoman who contributes to the mission and vision of the alliance as well as shining her own entrepreneurial light.

Tickets for the awards banquet will go on sale by March 12 at the organization’s website, www.awobwomen.org.

The Alliance of Women Owned Businesses is a membership-driven nonprofit organization formed for the purpose of supporting women-owned businesses in the West Sound and South Sound regions.

Chamber brings resources from SCORE and Tacoma Community College to Gig Harbor

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 5

The Gig Harbor Chamber of Commerce has announced a new partnership with SCORE, a resource partner with the Small Business Administration (SBA), and Tacoma Community College to offer businesses in the Gig Harbor area local education and mentoring opportunities.

Mentors from SCORE will be conducting meetings at the chamber office on Wednesdays from 1–4 p.m.

Individuals can schedule a meeting with the mentors on a number of topics including accounting, legal issues, human resources, business plans and marketing counseling. There is no charge for the program and it is open to all business owners and potential new businesses in the Gig Harbor area.

In addition to the mentoring program, the chamber and TCC also will be offering monthly workshops on the third Friday of the month this spring at TCC’s Gig Harbor campus.

The first workshop, titled Recordkeeping – Accounting for Small Business, will be March 21 from 1–5 p.m. This workshop is designed for non-accountants to help them understand accounting principles, financial statements, general business records, taxes and management accounting. A fee will be charged for most workshops and will be due at time of preregistration. To preregister for the workshops, contact TCC at 253460-2424.

One of the goals for the chamber this year is “to offer more educational opportunities for its members” according to chamber president Warren Zimmerman. The chamber, SCORE and TCC are working together to create programs and expand educational forums. More information concerning classes, workshops and scheduling will be available as the program develops.

For more information on these programs or to schedule meetings with one of SCORE’s mentors, contact the chamber office at 253-851-6865 or info@gighrborchamber.com.

Stalled contract talks prompt union workers to hold informational picket at Harrison

6 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

By Tim Kelly, Editor There has never been a strike — and possibly never even the threat of one — by any of the union-represented groups of Harrison Medical Center employees, yet a disagreement over language relating to strikes is the primary reason for an impasse in contract negotiations with a group of nearly 800 employees.

Those workers in the “protech” classification — medical technicians and employees in a range of other hospital jobs — are represented by United Food and Commercial Workers Local 21. A group of them held an informational picket outside the main Harrison hospital in Bremerton on Feb. 19, and as of press time no further negotiating session had been scheduled in the Union-represented professional and technical employees of Harrison Medical Center hold an informational contract talks that began last picket outside the hospital in Bremerton on Feb. 19. Negotiations with Harrison for a new contract for nearly 800 workers began last July but have reached an impasse. summer.

“We’re still hopeful we’ll be able to get to that point,” UFCW strike” by pro-tech workers if another year contract proposal to two years, she said. spokesman Tom Geiger said on Feb. 26. union-represented group at the hospital When the proposed two-year term The pro-tech workers’ action team that went on strike. The hospital’s proposed expires in mid-2015, Harrison’s affiliation planned the informational picket will meet contract says any employee who refuses to with Franciscan Health System will be fully the first week of March to consider “what implemented and all employees’ pay and cross picket lines to report to work “shall be next steps they may decide to take if we’re benefits will come through Franciscan and subject to immediate dismissal.” not back to the bargaining table yet at that its parent company, Catholic Health The UFCW also represents nurses and point.”

Initiatives. service workers at Harrison, although Harrison officials say they've agreed to Union officials and workers have raised neither of those groups is in contract wage increases and the union's request for the question of possible Franciscan negotiations at this time. workers to keep their existing health care influence on this round of contract talks, Contracts for pro-tech workers have coverage instead of switching to the which stalled in January after six months. long had a no-strike clause, along with a hospital's plan that covers other employees.

Past contract negotiations with the prostipulation that employees would not be The health plan extension with no disciplined or fired if they refuse to cross tech group have been mostly free of premium increases was a major concession, picket lines of another group’s legal strike. contentious issues.

Harrison marketing and communication Geiger said what’s different this time is “They have had that right for many director Jacquie Goodwill said. That’s also that Harrison wants language added to the years, and Harrison Hospital has never why the hospital changed its original threecontract that would prohibit any “sympathy opposed that or tried to remove it,” Geiger

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said. “Now they have, and they have not given any real reason why.”

Harrison’s human resources director sent a Jan. 28 update to hospital employees on the “last and final offer” presented to the union. The notice said “Harrison had proposed the clause, which is common in the healthcare industry, to ensure that our patients receive safe, effective, and continuous care.”

The notice also said union negotiators did not schedule a vote on the proposal as Harrison requested, and kept open other contract issues on wages and benefits.

However, the HR update said union the was willing to resolve all those issues “if Harrison dropped its proposal for a true nostrike clause that prevents work stoppages.”

Kay Gearllach, a Harrison emergency room technician, said union members are confused over why their employer is insisting on language banning sympathy strikes, since all union-represented workers already have no-strike clauses in their contracts.

“Who would we sympathy strike with?” she asked. “If we are without a contract, which we have been since September, we could strike. But it’s never been anything anybody has talked about until now.”

She added that Harrison management “let the contract lapse, because they were tied up with the affiliation. The union was ready to negotiate earlier.”

Goodwill said in an email to the Kitsap Peninsula Business Journal that the strike language proposed for the pro-tech contract is the same as in the contract for Harrison nurses, as well as for UFCW workers at numerous other hospitals.

“The patient care environment is too critical and we feel that our patients will be at risk if the UFCW is allowed to strike,” she said. “This is a common clause in healthcare contracts,” and would provide the “labor peace guarantees” that Harrison is seeking.

“There’s always been labor peace, and there’s never been any kind of threat in the past that there would ever be a strike,” Gearllach said. “So why now is that a problem?”

The current situation seems something other than labor peace; UFCW has filed six unfair labor practice complaints during the negotiations. After receiving Harrison’s final contract offer, the UFCW workers met and approved an action plan that started with the informational picket on Feb. 19. The union wants to inform the public and patients of the issues in the sta lled contract talks.

“This is really a confusing time,” Gearllach said. “Now that we’re affiliating with CHI, it begs the question — what is the reason they are pushing for this?”

Goodwill said Harrison has not changed its approach from past contract talks, and is negotiating its own labor agreement with no influence from Franciscan.

However, workers like Gearllach wonder about the future, and whether Harrison wants a ban on sympathy strikes in the contract to weaken the union.

“Maybe it’s not about this contract, it’s about the ones to come,” she said. “The contracts they plan to do with Franciscan.”

Healthplanfinder enlists Slaughter County Roller Vixens for outreach The Washington Health Benefit Exchange began its final push before the March 31 signup deadline with a series of promotions targeting the younger demographic. The promotional outreach includes partnerships with hockey leagues and roller derby teams around the state, including Bremerton’s Slaughter County Roller Vixens.

“In order to break through and reach new audiences, we have to be in unexpected places,” said Michael Marchand, director of communications for Washington Health Benefit Exchange. “Ice hockey and roller derby bouts target our key demographic of young adults and families who may not be aware of the new opportunities that are available through our state.”

Washington Healthplanfinder is a sponsor of the Wild West Showdown on Feb. 28-March 2. The statewide roller derby tournament is hosted by the Roller Vixens at Kitsap County Fairgrounds. The health exchange planned several activities including a photo booth and localized posters that will be signed by the Vixens at the health exchange booth.

“This is the biggest roller derby tournament in the state and it brings in a lot of people,” exchange spokeswoman Bethany Frey said. “Our presence there is all about awareness and fan engagement.”

The events are aimed at encouraging young adults ages 18-34 to check out the new plans and financial help available through the Washington Healthplanfinder.

The exchange has also launched two new ads using a fictitious rap duo interviewing residents signed up for coverage through the exchange and highlighting their success stories.

More than 406,000 Washington residents had signed up for health insurance through the Healthplanfinder as of Feb. 20, not including Medicaid redeterminations. More than 100,000 of the sign-ups were people who enrolled for a private insurance plan. Of the individuals signed up for private plans, about 22 percent are in the 18-34 age category — a number that Frey said reflects the nationwide trend.

Open enrollment in private plans through the exchange for 2014 ends March 31, but there is no deadline for

those who qualify for Medicaid. There are only a few exemptions, but for most people having insurance after that is mandatory. The federal government will impose a fee of $95 per adult and $47.50 per child (up to $285 per family), or 1 percent of income (whichever is greater) this year, and for 2015 the penalty will climb.

Frey said the exchange didn’t have a specific target by age demographic. “We are happy with where we are but it’s critical to continue reaching out as the deadline for open enrollment gets closer.”

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The Kitsap Economic Development Alliance will hold its annual membership meeting and lunch on March 20, from 11:30 a.m. to 1:30 p.m. at Baymont Inn & Suites in Bremerton.

The purpose of the meeting will be to provide members with the 2013 Annual Report of performance and financial condition, present the 2014 KEDA Priorities and Work Plan, and to elect directors to the KEDA board.

In addition to the investor member business noted above, we will present the new KEDA Digital Ambassador program and honor this year's Economic Development Champions.

Online registration is available for the event, which will include a catered lunch by Le Garmache Catering. Tickets are $45 for current KEDA investor/partners and $60 for the public; or $300 for a table of eight KEDA investor/partners or $400 for the public. Registration deadline is March 14.

For information about additional sponsorship opportunities, contact Theresa Mangrum at KEDA, 360-377-9499.

According to the Washington Health Benefit Exchange, more than 53 percent of individuals who qualify for private health plans with a tax credit to lower their monthly premiums are under 250 percent of the federal poverty level (FPL). For an individual, this equals $29,175 a year or $59,625 a year for a family of four. More than 20 percent of enrollees are between 300 to 400 percent of the FPL, while the remainder did not apply for a tax credit.

For more information about Washington Healthplanfinder, go to www.wahealthplanfinder.org.

The Retirement Myth

8 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

“We don’t stop playing because we grow old; we grow old because we stop playing.” ~ George Bernard Shaw

By Dan Weedin My wife Barb and I went to see Paul McCartney perform live at Safeco Field last year. I can honestly say it was one of the highlights of my life. I knew that this was probably the last time I would have a chance to watch a former Beatles member perform live. McCartney was 71 years old at the time and I doubted Seattle was going to be a destination spot for future events. Barb and I enjoyed watching Sir Paul regale a packed house on a beautiful summer night for nearly three hours without a break. Three hours!

This included three encore performances alongside former members of Nirvana, all easily half his age. Just a few weeks ago, I watched the CBS special of the 50th anniversary of The Beatles on the Ed Sullivan Show.

McCartney was there with the other living member of the band, Ringo Starr (who is older than him.) They put on an amazing show. At 72, McCartney probably can’t even spell “retirement,” nor does he want to.

The Retirement Myth is that we all yearn to save boatloads of money through prudent investments so that when we reach somewhere around 65 years old, we can kick back in our Bermuda shorts, relax, play golf, and sip lemonade by the pool in the evening. At least that was the thought when I was a kid in the 1970s as to what the goal was for adults. At that time, most people spent a lifetime of work at one place (many had a first career in the military.)

They stayed there, working with heads down to earn a living and put money aside, with that hope of having enough at the end of their careers to live long and prosper in the golden years.

A study conducted by Boeing and Lockheed Martin shows that on average, retirees lived about 17-18 months after retirement. I understand there are numerous factors to consider, yet other studies by major corporations and universities point to a similar conclusion. “Retire” and die.

Before you jump all over me about not prudently investing, relax. I’m all for saving money wisely to have enough to live on for the rest of your life. However, what I am saying is that you should have enough to live on AND keep “working” because you need a purpose and it’s good for your health.

I believe too many people scrimp and save to a degree that is purely overkill.

Let’s be honest, we only come around this way once. Making wise investments, buying proper insurance policies, and having contingent plans that have been considered through planning with a professional adviser is smart. But so is investing money into your life’s experience. That means little things like taking that cruise while you’re young and can enjoy it most. That means paying more for better seats at the symphony or theatre. That means living life now because tomorrow is not promised.

That’s Part 1. Part 2 looks something like this…

Keep working into your golden years.

Not because you have to in an effort to avoid poverty (see my comments on wise investing.) Do so because it adds value to others and fulfillment to you. Paul McCartney doesn’t need the money.

Neither does Bill Cosby, who we saw kill at Benaroya Hall a few years ago at the youthful age of 69 years old. These guys perform and “work” because they love it.

What are you doing that you love?

Well, that leads to Part 3.

Just like you need to make wise choices and plan for your financial future, you need to do the same for what you want your future to look like. It’s not human nature to sit around and do nothing. If you’re reading this column, you are probably a successful businessperson who got to where you are through your passion and activity.

Find something that you will be passionate about later in life. To help you get started, allow me to offer my 5 Tips to Avoiding “Retirement”: 1. Stay healthy. That means eat better and exercise smarter as you get older.

2. Volunteer. Find some charity or worthwhile venture where you can volunteer. It might mean rolling up your sleeves, or perhaps a board position. There are plenty of places that need you.

3. Find a way to keep income flowing.

Seriously. You can tell me all you want to about wanting to just volunteer, but for most of us it’s fun to make a little extra money.

Especially if you’re using your talents and skills to do it!

4. Ideas to accomplish. Speak, write, publish, teach or consult. Heck, you undoubtedly are full of intellectual capital borne put of years of working in your profession. How valuable is that intellectual capital to others?

The answer is it’s HUGE. Find a way to manifest those “smarts” into value to others.

5. Have fun. Take trips, live in the moment, take risks, and reap rewards.

The bottom line is that the myth about retirement is that it even exists. In today’s ever-changing world, technology and other innovations are allowing us to live longer. You need to be prepared to not only pay for it, but to find ways to maximize it. Then you can really proclaim that you’ve unleashed your life’s potential!

• Dan Weedin is a strategist, speaker, author and executive coach. He helps business leaders and executives to become stronger leaders, grow their businesses, and enrich their lives. He was inducted into the Million Dollar Consultant™ Hall of Fame in 2012. You can reach Dan at 360-6971058; e-mail at dan@danweedin.com or visit his website at www.DanWeedin.com.

Former history teacher at West Sound Academy joins school’s board of trustees Laurence Kerr, a former career member of the U.S. Senior Foreign Service was a history teacher at West Sound Academy in Poulsbo and college counselor for Upper School students from 2009 through 2012, has joined the school’s board of trustees. The board is a group of volunteer parents and community members who are responsible for policy decisions, financial oversight and governance of the private school’s affairs.

"We're extremely pleased that Larry will be joining the board of trustees,” board chair Jeffrey Uyye said. “The global perspective his long service with the State Department brings, along with his familiarity with WSA as a former teacher, fits perfectly with our vision of WSA as an IB Laurence Kerr World School."

Barrie Hillman, head of school, added, "We're glad to welcome Larry back to WSA. He will be a real benefit to the school, having experience in both the classroom and the boardroom of other nonprofits."

A Bainbridge Island resident, Kerr has always been active in the community, serving on the boards of various community groups. Even after his WSA teaching days ended, Kerr kept up his involvement with the school, and he used his expertise in boat building when he returned to WSA in the role of teacher for the 2014 Jan Term class, Wooden Boat Restoration.

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Retirees love the RV lifestyle for travel For Donna and Jim Smeall, fulltime cruising sounded like a good idea.

Several years ago, the couple dreamed of selling their home and living and sailing around on a boat. But because of Donna’s hearing loss, she couldn’t balance on a boat. Instead, the Smealls decided they would make their RV, which they bought in 2008, their fulltime home.

First, they had to wait for Jim to retire from his job at the Bremerton shipyard. Once he did, last fall, things moved fast — the Smealls’ Key Peninsula home sold shortly after it went on the market earlier this winter.

“Selling our home makes this dream a reality and also gives us the wherewithal to clear all of our debt and retain funds for random trips we want to do, like the Albuquerque balloon festival.

RVing allows us to have comforts of home along when visiting some of Mother Earth's wonders around the USA,” Donna Gates-Smeall said.

The first place they headed to in January was her parents’ home in Lake City, Fla. The Smealls also visited several places in California, Oregon and New Mexico along the way. The plan is to hang out in Florida until April and then head back to the Northwest for medical appointments.

“In fall and winters, we will travel

the South/Southwest and use springs and summers to do the East Coast,” Gates-Smeall said.

For those contemplating the idea, Dowling recommends shopping on some of the major websites such as rvtrader.com. “The online sites are great for educating yourself and figure out what appeals to you,” she said. “But the prices are all over the map so you have to decide what you can afford.”

Buying an RV is like buying a car, according to Mitchell. The price range is quite wide, and the selection depends on what a person is trying to do, he said. For the Mitchells, opting for what Larry calls a “diesel pusher” (the engine is in the back and it rides like a Cadillac, he said) was convenient because not only can they haul a lot of water, they have a 100-gallon tank that can take them from Port Orchard all the way to California. The downside is that he can’t back up easily, especially while towing a car, so “you want to make sure you know where you’re going,” Mitchell said.

I don’t think RVing is exciting for everybody,” he said. “It can be a lot of work. …For me, it’s a lot of fun.”

Donna and Jim Smeall in front of their RV while visiting her parents in Florida.

Courtesy photo

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 9

By Rodika Tollefson If things go well for Janet Dowling and her husband, Bill, the pair will drive home a new RV by the end of March or so. A dream in the making for a couple of years, the RV will give the Key Peninsula couple a new way to do what they love — travel.

“In the 30 years we’ve been married, we have taken a zillion road trips, especially in the West,” Janet Dowling said. “We love road trips.”

Dowling retired after closing her business, Potlatch Gallery, in downtown Poulsbo in March 2011. She started shopping for a recreational vehicle a couple of years ago, first at local dealers and then online after discovering that prices were lower in other states in the West.

Their ideal find will be a 28-foot, “R-Pod” style trailer — and the sooner they find one, the better, Dowling said, as they already have plans for a wine country tour and a blues festival this summer. And they already have long-term dreams: buy a house in Palm Springs and travel around every summer in the RV, at least for a few years.

“A lot of RV parks charge $35-$40 (a night) but that’s a lot cheaper than a night at a resort,” Dowling said. “It’s nice to know you’ll have a place to stay while on the road and you have your stuff with you.”

RVing can get expensive once camp fees, gasoline and maintenance are penciled in, but for some people, it’s a matter of lifestyle. For Rita and Larry Mitchell, traveling in their RV means they can bring along their two Australian shepherds. It also means flexibility, especially since they tow a car too.

“We can stop if we’re somewhere we like and we’re self-contained, so we can do whatever we like,” Larry Mitchell said.

The Port Orchard couple, who’ve been married for 22 years, are on their third RV together. They typically take a long trip every year out of state and a few short ones to closer places like Long Beach. Larry also takes it out, along with his boat, on fishing trips.

This past fall was a typical trip. The Mitchells went to visit their daughter in Houston for Thanksgiving, stopping en route in Las Vegas for a week. A stay in Houston was followed by a trip to New Orleans, then another stay for Christmas with family in Texas and another Vegas dash on the way home.

They have found several favorite locations, including New Orleans, that they try to revisit as often as possible. “We’re into food and when we get out of Washington, we find ourselves overwhelmed with choices,” Mitchell said.

“New Orleans has some of the best food in the country so it’s exciting to go there.”

Mitchell said the space in the RV does feel constrained after a while, so he can’t imagine RVing full-time. But for avid travelers, it’s the perfect match.

“When we were self-employed (before retirement), we took time when we could get it,” he said. “Now whenever the cards line up right, we’ll go do something.”

Smart exit strategies begin with early planning

By Donald Brown, KeyBank When most business owners develop a plan and look into the crystal ball, they see a future of sustained success and profitability for their venture. What they often fail to see and plan for is the byproduct of that success — that someday they will either want or need to move beyond what they’ve worked so hard to build.

I have always advised my clients that there is a difference between “succession planning” and an “exit strategy.”

Succession planning is simply who is going

10 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

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to take over your position and replace your name on the door. An exit strategy is much more involved and is your detailed plan to exit that business with the financial resources to live the rest of your life in the manner to which you have grown accustomed.

As an entrepreneur, it may be simple for you to say, “when I’m ready to walk away, I’ll walk away,” but it’s more complicated than that. If you realize the success you set out to achieve, there are going to be a lot of factors that you need to consider, and the earlier you start thinking about them, the more prepared you will be to control the timing, valuation and financial planning of your exit.

It’s never too early to start planning an exit strategy If you’re an entrepreneur, you should start planning for your eventual exit in the early stages of beginning a new business venture. But it’s never too late to put a plan in place. Think of it as an ongoing process with short-, medium- and long-term aspects that will provide your business with impetus to grow, increase cash flow and protect assets for your family. Early planning also allows you the opportunity to minimize taxes, as a variety of trusts are available that allow you to continue to control your company and its assets, including stock, while offering full trust and estate protection.

Another reason why considering an exit strategy so early in the process is important is that a growing, vibrant business will inevitably attract potential partners, expansion opportunities and/or acquisition offers. Or it will reach a point where it is ready to go public. Early planning and accounting for these possibilities will allow you to make more informed decisions that align with your desires for the company, your employees and other stakeholders.

Exit strategies account for three factors When planning and creating your exit strategy, you should focus on three factors: 1. Short- and long-term objectives. Do you really want to leave the business? Can it survive without you?

2. Stakeholders. Take a look at your employees, investors and any family members who may be involved in the business. What is the talent pool? What does that imply for your exit options?

3. Industry trends and your business model. Are you a business funded by your founders or by profitable operations? Or have you used an outside investor to meet growth objectives? How might industry trends influence the type of exit opportunities available to you?

In today’s global, technology-driven economy, change is rapid. Undoubtedly this change will affect your plan. However,

a well-developed exit strategy is carefully connected to your overall business strategy. If you successfully execute your business plan, the opportunity to grow in a manner that is attractive to buyers will create the opportunity to exit — in a number of ways.

Options for exiting a business There are two avenues for exiting a business. First is internal. Internally, you can gift or sell your business — or do a combination of both — to family members; enter into a buy-sell agreement with partners; sell to current management or senior employees; or liquidate and sell assets. The second exit option is external.

Externally, you can sell to either a competitor or third-party buyer; sell to an investor group; or have an initial public offering of stock.

The valuation of your business is extremely important. It can fluctuate over time, due both to circumstances unique to your business and to macroeconomic factors, but it is imperative that you have a good handle on your business valuation.

This is especially true if you are planning to retire and will largely base your exit decision on income needs. There are also tax implications for both parties to a deal, and valuation is something the IRS closely scrutinizes.

It is also important that your estate Strategies, page 11

Staying active close to home (plate)

By Tim Kelly, Editor What's a good way to keep physically active and mentally sharp as you reach retirement age and beyond?

Stay in the game, literally.

That's what works for veteran members of the Peninsula Umpires Association (PUA) who are still calling balls and strikes at local baseball and softball games.

None have been doing it longer than Dick Brakefield of Bremerton, who started umpiring in 1971, back when Lou Piniella was a rising star outfielder for the Kansas City Royals.

"I enjoyed playing ball when I was in school, and I enjoy being around young people," the 66-year-old Brakefield says.

"It's just a great atmosphere to be out there on a nice spring day and working with young people."

That's an attitude shared by fellow umpires.

Chuck Sacrison, 62, of Port Orchard wanted to coach his son's Little League team in the 1990s, but didn't have the time

because he was working at the naval shipyard in Bremerton and serving in the Army Reserves. "So to pay my dues, I became an umpire," he says.

After missing a season due to open heart surgery in 2000, the next year he joined the PUA, whose members work high school and American Legion ballgames. Sacrison, who retired from the shipyard in 2007, advanced in umpiring and has had opportunities to travel to national tournaments, even going to Italy for a tournament once. Last year he was on the umpiring crew for the 2013 Little League

Senior Softball (age 15-16) World Series in Delaware, and got his moment of fame during ESPN's live broadcast of the championship game when TV replays of a close tag play at second base confirmed he got the call right.

Larry Vancil of South Kitsap, a former project manager at the shipyard, also had his first experience in Little League, though it wasn't until his retirement in 1993 that umpiring became a regular avocation.

"I'd been a football official since the 1970s," says Vancil, who played semipro football for the Keyport Torpedoes in

1967-68. A couple guys he worked football games with also did baseball and asked him to give it a try since he had more time after leaving the shipyard. "I'd only been retired four or five months, and when I asked my wife what she thought, she said 'when can you start?'"

Vancil, who turned 72 in February and gave up football officiating a few years ago, and Brakefield, who will retire from his job at Waste Management at the end of this year, both say this will be their last season Umpires, page 14

STRATEGIES

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 11

from page 10 plan and exit strategy be integrated and work in harmony with each other. Too often business owners make the decision to exit a business, put a succession plan in place and have their lawyer draft a buy-sell agreement… only to find out that their exit-strategy documents and estateplanning documents are working in opposite directions.

Deciding when to exit Planning an exit for a closely held business is challenging for a number of reasons. Timing matters. If you sell when your company is at peak performance, you are most likely to receive the highest valuation. Stability is also important. Are core employees going to be retained, and is the business viable as an ongoing entity?

If you are gifting or selling the business to family, can you find a way to be fair to family members without necessarily being equal when it comes to assigning ownership and management responsibilities?

Also, in advance of any plans to sell or retire your stock, and before any agreement or letter of intent is signed, you should establish a trust.

These are just a handful of the considerations business owners face when planning an exit strategy. There are many more, which is why entrepreneurs should consult with a professional early and often in the business planning process, because working with an expert in tax, legal and family issues at the start of your business will make your business that much more valuable at the end.

• Donald Brown is vice president and senior relationship manager in KeyBank’s South Puget Sound District. He can be reached at 253-358-2499 or donald_x_brown@keybank.com.

Encore Communities adds memory care facility

By Rodika Tollefson Encore Communities added memory care to its services in January, following the purchase of the Emeritus of Silverdale facility, which was renamed The Ridge. The Ridge is one of four Encore communities, which also include Country Meadows independent retirement cottages, Clearbrook Inn assisted living and Northwoods Lodge skilled nursing and rehabilitation. The Ridge is located within two miles of the rest of the 13-acre Encore campus.

The Ridge includes 52 beds in private and semi-private apartments, which are fully furnished but can also accommodate personal furnishings. The building is comprised of two pods, or “neighborhoods,” each with its own dining room, living-roomstyle common rooms and two courtyards, with a fifth one connecting to both pods.

Each pod has a country-style kitchen that is available to family members and is used for resident activities such as a baking club.

Other common areas include a library (complete with an office desk, a library and a typewriter), a men’s “workshop” with basic tools and a “sewing room” with fabrics.

“We try to make it just like a home environment,” said The Ridge executive

director Alena Gimlin.

The facility is designed to look like an actual neighborhood. The common area off the entryway simulates a town square that includes a porch on one side and a “convenience store” on the other, while the hallways resemble streets and the staff offices are made to look like storefronts.

“There is a feeling of a downtown when you come in,” Gimlin said. “Quite a few people just like to walk the ‘path’ and feel like they’re outside.”

Encore has made some cosmetic changes, mostly to the décor, but has also added 15 more staff members. “We have increased the budget so we have a good caregiver ratio and we added licensed nurses for 20 hours a day. We feel it’s important to have licensed nurses to observe the residents. We’re completely designed for memory care,” Gimlin said.

Typical activities include live entertainment, “happy hour” (with mock drinks), arts and crafts, Bible studies and scenic tours. An on-site beauty shop, open once a week, serves both residents and staff.

Gimlin said the residents range from those in the early stages of dementia to those who are in hospice care.

Rodika Tollefson photo

One of the common areas at The Ridge is decorated with masculine decor and includes a workshop with basic tools.

“Everything from the daily routine to the entire daily structure is for someone who has memory struggles. We like to give (residents) the flexibility to be in their moment and in their world, and that makes us unique,” Gimlin said.

In addition to long-term care, The Ridge offers adult day care and respite care with short-term stays.

Gimlin said that she sees a growing need for dementia care.

“Dementia is hitting people younger and younger — sometimes when they are in their 50s and 60s, and people are living much longer,” she said. “Encore has had a wonderful reputation for 20 years but we have never done memory care. Now we have the full spectrum of care.”

Two new physical therapists join Bainbridge Island clinic

12 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Physical therapists Monica Schutt and Emily Durban will join the staff at New Motion Studio on Bainbridge Island.

Schutt has a doctorate of Physical Therapy from Slippery Rock University and is a nationally certified pilates instructor. Durban received her doctorate in Physical Therapy from University of Puget Sound.

The studio’s class schedule is at www.newmotionpt.com.

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Modern-day downsizing with no mortgage payments and more cash reserves

By Tane Cabe Downsizing has become the desire of many Baby Boomers and mature Americans. They have raised their children in th e family home, worked hard to pay off or pay down their mortgage and are ready to sell and move to their retirement dream home. Unfortunately for many, it can be difficult to make the finances work. Do they sell the home and pay cash for the new one, get a small mortgage, or just stay? According to the Demand Institute and American Housing Survey, 64.5 percent of homeowners age 62 and older own their homes free and clear and over 40 percent of them have a desire to move and purchase another home. The truth is it’s much easier than ever to make the move.

What many retirees don’t realize is they can purchase a new home and have no mortgage payment without paying all cash for the next house.

Rick’s modern day ‘downsize’ story Rick is a 73-year-old who recently sold his waterfront home on Mason Lake for $600,000. Before he sold his home, he was torn about how to downsize. The math just didn’t seem to work. Since he had a mortgage on his home, he needed to sell it for a high enough price so he could purchase a new home for cash. Rick’s payment of $937 on the Mason Lake house was two thirds of his monthly retirement income. He was determined to not have a mortgage payment on the new home, but he thought paying cash was the only way.

He had about $380,000 in equity, but the dream retirement home he wanted to purchase was $418,000. How was he going to make this work?

Retirement planning workshops Upcoming free informational workshops will be hosted by Tane Cabe, author of Double Your Retirement Dollars — Little Known Secrets to Increase Income, Assets and Cash for Today’s Retiree, at the following Kitsap Bank branch locations: • March 13 in Sequim at 10:45 a.m.

• March 13 in Port Angeles at 2 p.m.

• March 18 in Port Ludlow at 10:45 a.m.

• April 8 in Kingston at 10:45 a.m.

• April 10 in Silverdale at 10:45 a.m.

• April 17 in Port Orchard at 10:45 a.m.

Call (800) 490-4287 for more details. Workshops are free to the public, and there is no obligation.

Fortunately Rick learned about a program at a workshop he attended. He learned about an FHA government-insured program, called a Home Equity Conversion Mortgage, which allows retirees or almost retirees to purchase a home with no mortgage payment, and not pay all cash.

This program is designed to help Baby Boomers and mature Americans purchase a home while preserving cash and reducing monthly obligations.

Here’s how it worked for Rick: He made an offer on a new home in University Place.

The home was a 1,400 square-foot, 3bedroom, 2-bath home in a gated community. Simultaneously, he listed his home for sale on Mason Lake and soon sold it, netting $380,000. Rick put $181,000 down on the new home, with the remaining purchase price being covered by a Home Equity Conversion Mortgage. This loan does not require Rick to make any payments for life as long as he lives in the home, though he is still responsible for paying the homeowners association dues, property taxes and insurance.

The end result is Rick now lives in a brand new single-level home with no

mortgage payment and $199,000 in extra cash he can use for living. Rick only needed to prove he was at least 62 and had the cash available, which he used from his Mason Lake home to qualify for the loan.

With the housing market decline, equity over the last several years has fallen significantly, and is just now starting to make a comeback. As a result, many people have simply decided to stay in their homes and not sell, since most retirees don’t want a mortgage payment. Most believe they have two options when purchasing a home for retirement. The obvious option is paying all cash so they don’t have a mortgage payment.

The second option is paying a large amount down and carrying a small mortgage with a

low monthly payment. The problem with these options is one exhausts valuable cash resources, while the other requires qualifying for a mortgage and servicing a monthly payment. Both options are not desirable for most retirees.

How it’s a loan but requires no payments Rick doesn’t ever have to make a payment while he lives in the house; the interest is simply added onto the loan with no obligation to pay it back until he permanently moves out. As the loan increases, the value of the home may also increase or decrease. The equity position does not matter. If the market value of the home decreases, Rick or his heirs will never have to pay the excess loan balance above the sales price. It is a non-recourse loan, meaning Rick or his heirs are not responsible for the balance. If there is equity left when the home is sold, Rick or his heirs are able to keep it with no penalty.

For those seeking to downsize to a new home and have no monthly payment, there is now a new option. No longer do Baby Boomers and mature Americans need to pay cash to achieve no mortgage payment.

The Home Equity Conversion Mortgage allows a person to purchase a home with no payments for life.

• Tane Cabe is the manager at Churchill Mortgage in Gig Harbor, the only mortgage company exclusively endorsed by Dave Ramsey.

By Robert Powell, MarketWatch When it comes to finding a state to which to retire, there are plenty of factors to consider. There’s the weather, proximity to family and friends, access to health care, quality of life, and the list goes on, according to CCH, Wolters Kluwer. But one factor that you might want to weigh more heavily than others when deciding where to live in retirement is the degree to which your precious income and assets will be taxed.

“Retirees should really do their homework on the types of taxes they’d be responsible for paying and the rates they’d be taxed at when comparing different locations,” Sandy Weiner, a state tax analyst for Wolters Kluwer, said in a release.

Specifically, you should consider, according to Weiner and others, state taxes on retirement benefits, state income tax rates, state and local sales tax rates, state and local property taxes, state estate taxes, state inheritance taxes, and the overall tax burden.

Indeed, the best state for you to retire to,

tax-wise at least, will depend on many personal factors, including your level of income, your sources of income, how you spend your money, whether you are able to itemize deductions, and how states and municipalities raise revenue. (Some states, for instance, might seem like a haven for retirees by one measure, but not so much by other measures.)

So, let’s say that you’re among those retirees in the upper income quartile, who have, on average, income of $78,180 and where 18 percent of your income or $14,072 comes from Social Security, 22 percent or $17,199 comes from a pension, 44 percent or $34,399 comes from earnings, and the rest comes from your various retirement accounts in the form of dividends, interest income and capital gains.

States to consider/avoid if you plan on working in retirement — Given that, you ought to move to a state that has no States, page 18

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Most tax-friendly states for retirees

UMPIRES

from page 11 on the diamond, though they'll miss it once they give up umpiring.

"I like the interaction with the kids, and the coaches, too," Vancil says. "I still miss going out to football games with a crew on Friday nights."

Others like Don Sommer of Bremerton expect to keep going a few more seasons, even though he's recovering from knee surgery last fall.

"It's stimulating both physically and mentally, and it's fun with the kids," says Sommer, who turns 68 in March and will retire from the shipyard this year. He's been a baseball/softball umpire for a decade, as well as a soccer referee for 25 years. "If you can't play or coach, you referee."

Bob Theal of Bremerton is another welltraveled umpire, who started when he was in the Navy and had shore duty in Stockton, Calif., in 1977. Over the next several years, he umpired ballgames in Dubai, the Philippines, Australia and Guam.

"I was on a ship that went to Diego Garcia, a little archipelago in the middle of the Indian Ocean," Theal recalls. "There's a

Courtesy photo

Peninsula Umpires Association member Chuck Sacrison, second from right, and other umpires join in when “YMCA” is played between innings during the championship game at the 2013 Little League Senior Softball (age 15-16) World Series, held in Roxanna, Delaware last August. big Navy base there and the softball field is all crushed coral."

Now 62, Theal has retired from two careers since joining the PUA in 1988 after getting stationed at Bangor. He got out of the Navy in 1992, and took early retirement from the shipyard a year ago to have more

time as caretaker for his wife.

He enjoys being "a neutral party" on the ballfield and says he has the passion to keep going as long as his knees hold up.

"I consider it community service without a judge telling me to do it," Theal quips. "I enjoy it physically and mentally as a release;

14 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

MONITORING

from page 1 The cloud-based system, called UNITY, can dim lights, adjust air ventilation and send alerts via email or text messages when something malfunctions. It monitors energy use in the building 24/7, automatically controlling systems based on set parameters, and allowing users to control functions both on-site and remotely. The on-site system uses a touchscreen monitor and a Mac mini processor (hidden behind the panel.) A chip is used for wireless communication and if the internet goes down, the modules run themselves and the switches become manual.

The system has helped Silver City Brewery save on energy use since it was installed about two years ago, because everything is optimized. It also helps monitor equipment and determine when things are not running properly.

“Having all the (monitoring) information is valuable. Up until now we had no idea if the building was balanced,” said Silver City owner Scott Houmes.

Another major advantage is that the system won’t cost the business any money.

A grant from Puget Sound Energy paid for 70 percent of the UNITY cost, and the balance of $5,500 will be recovered through the energy savings over about three years.

Kite & Lightning guaranteed that the company will save at least that much — and if it doesn’t, it will only have to pay the amount it had actually saved.

Once the system is paid off, Silver City will simply save money on electricity.

I look forward to walking on the field."

Umpires are paid and most say the supplemental income is nice, but the game fees aren't going to swell anyone's 401(k).

They get one check at the end of the summer for all their games.

Brakefield says it's like getting a bonus, and he spends his on hunting trips or buying something special for his wife or their house.

Sacrison's pay from the regular season finances his postseason travel, such as last season when his wife went with him to Delaware.

"Anything I get paid usually goes back to summer Little League tournaments I go to," he says. "I've been going all over creation for those."

No matter where the games or what level, these umpires enjoy what they do, including good-natured needling of a partner who blows a call.

"When it becomes not fun anymore, I think that's when most people quit," Sommer says. "I like keeping a sense of humor while you're out there, working hard doing the best you can every game and every inning. When I can't do that, that's when I'm going to quit."

use for the space by adjusting controls in real time based on what it learned from the previous cycle. Functions can also be programmed based on parameters such as temperature. For example, vents will automatically open overnight during the summer to help the building cool off and delay the use of air conditioning.

“It produces savings over what a thermostat does,” Hickner said.

UNITY also regulates the air balance and pressure to make the building more comfortable. “You don’t smell the kitchen and the air is fresh,” he said.

An Innovative Idea

Rodika Tollefson photo

The UNITY energy management system Silver City Brewery can be controlled both from an onsite touchscreen and remotely via the internet.

“The key is to be automated to the point it runs itself so you don’t have to worry about it,” Kite & Lightning managing partner Bill Hickner said. “You can manage

energy costs and equipment maintenance because the system lets you know when something is in the process of breaking.”

UNITY is designed to optimize energy

Hickner became interested in energy management when he worked as a facilities manager for Peninsula McDonalds, in charge of 24 buildings spread out through the county. He recalls standing in line for the Edmonds ferry one day and thinking if he could “see” inside those buildings remotely, he could do better maintenance of the facilities and equipment.

He began looking for a system that controlled everything — lights, refrigeration, HVAC — and when he couldn’t find it, he made one by combining others available on the market. The first one was installed at the Poulsbo McDonald’s, and Hickner said the site saved $900 the first month. Building on that success story, he approached PSE with the idea of writing a grant to cover the costs of the system if he could prove energy savings over time, and the utility agreed.

He eventually left McDonald’s to start Monitoring, page 15

Boyer decides not to seek fifth term as Kitsap County Sheriff Kitsap County Sheriff Steve Boyer has announced that he will not run for reelection this fall to a fifth term.

Boyer, who spent 27 years with the Washington State Patrol before he was elected sheriff in 1998, said health concerns factored into his decision to retire Steve Boyer from a law enforcement career of more than 42 years.

“Fortunately, medical professionals have ruled out any serious issues affecting my wellbeing,” the longtime sheriff said in a news release announcing his decision.

“While another term would be possible, this has prompted me to reflect on the future and consider some new adventures.

Although this may slow me down a bit, I consider it yet another challenge.”

The 63-year-old lawman has long been known for his friendly, engaging demeanor and as sheriff he made it a priority for his department to have good

communication with the public. In his three re-election bids, Boyer, a Democrat, won every time with at least 69 percent of the vote.

“It has been a distinct pleasure to work with so many outstanding professionals dedicated to the public’s safety,” Boyer said. “Leading our team of patrol deputies, detectives, corrections officers, support services specialists and volunteers has been a personal and professional honor.

Together we have accomplished exceptional results. The citizens have

every right to be very proud of their awardwinning sheriff’s office which is dedicated to our community’s peace and safety.”

Although he’s stepping down as sheriff, Boyer said he’s not planning to retire completely and is exploring some public and private opportunities.

Boyer, who has a son who is a Washington State Trooper, and his wife of 39 years, Judy, live near Keyport. In his announcement, he thanked his wife and family for their love and support.

MONITORING

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 15

from page 14 his own business. That original system was firmware-based and had limited programming capabilities. But it just happened that Hickner’s sons, Ryan and Jason, are computer programmers and developers. So he hired them in 2006 to write a custom program, making the second iteration of the system partially wireless.

Kite & Lightning (kiteandlightning.com) manufactured it in Mukilteo, where it was based at the time, and installed it in about 700 restaurants.

UNITY is the system’s third evolution, developed in 2010. It’s completely wireless and uses open-source architecture. Instead of manufacturing the hardware, the company uses over-the-counter products from several manufacturers.

“The advantage is scalability and serviceability so you’re not locked into one manufacturer’s part. And if we were to expand to Canada or Mexico — and it’s likely that we’ll do it — we can source the equipment there. Most of the product line is internationally available,” Hickner said.

His sons are now partners in the company, in addition to running their own, which offers software design for interactive kiosks and displays in places such as the Space Needle in Seattle. Hickner said Kite & Lightning is still essentially a startup, even though UNITY has been installed in numerous restaurants as well as offices, athletic clubs and other buildings, and has clients as far as the East Coast. He said what they do is unique because no one offers a comprehensive system like Kite & Lightning’s.

“The initial 70 buildings have been our incubator (for UNITY),” he said. “We’re moving into our initial marketing phase.”

The name of the company is a tribute by Hickner, a history buff, to Benjamin Franklin and his famous (and dangerous) kite experiment. He said part of what drives his business is curiosity about what can be done with electrical power, and another part is his belief in conservation.

“I’m a firm believer we waste at least half of our energy. One of the huge ways to produce is to conserve,” he said. “We have a long ways to go — even in our buildings — to conserve energy. … We’re constantly looking for ways to improve our system.”

Use ‘tax diversification’ to help manage retirement income

By Todd Tidball You need to save and invest as much as possible to pay for the retirement lifestyle you’ve envisioned. But your retirement income also depends, to a certain degree, on how your retirement funds are taxed. And that’s why you may be interested in tax diversification.

To understand the concept of tax diversification, you’ll need to be familiar with how two of the most important retirement-savings vehicles — an IRA and a 401(k) — are taxed.

Essentially, these accounts can be classified as either “traditional” or “Roth.”

When you invest in a traditional IRA or 401(k), your contributions may be taxdeductible and your earnings can grow taxdeferred. With a Roth IRA or 401(k), your contributions are not deductible, but your distributions can potentially be tax-free, provided you meet certain conditions.

(Keep in mind, though, that to contribute to a Roth IRA, you can’t exceed designated income limits. Also, not all employers offer the Roth option for 401(k) plans.)

16 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

www.edwardjones.com

Of course, “tax-free” sounds better than “tax-deferred,” so you might think that a Roth option is always going to be preferable. But that’s not necessarily the case. If you think your tax bracket will be lower in retirement than when you were working, a traditional IRA or 401(k) might be a better choice, due to the cumulative tax deductions you took at a higher tax rate.

But if your tax bracket will be the same, or higher, during retirement, then the value of tax-free distributions from a Roth IRA or 401(k) may outweigh the benefits of the tax deductions you’d get from a traditional IRA or 401(k).

So making the choice between “traditional” and “Roth” could be tricky.

But here’s the good news: You don’t necessarily have to choose, at least not with your IRA. That’s because you may be able to contribute to both a traditional IRA and a Roth IRA, assuming you meet the Roth’s income guidelines. This allows you to benefit from both the tax deductions of the traditional IRA and the potential tax-free distributions of the Roth IRA. And once you retire, this “tax diversification” can be especially valuable.

Why? Because when you have money in different types of accounts, you gain

Members SIPC

withdrawals, or take withdrawals from multiple accounts, to help reduce taxes and avoid moving into a different tax bracket.

Clearly, tax diversification can be beneficial. So after consulting with your tax and financial advisors, consider ways of allocating your retirement plan contributions to provide the flexibility you need to maximize your income during your retirement years.

Edward Jones, its employees and financial advisors cannot provide tax or legal advice. You should consult your attorney or qualified tax advisor regarding your situation.

• Todd Tidball is an Edward Jones financial advisor in Poulsbo.

Veteran officer will run to succeed Boyer as sheriff One of the top officers who’s worked with Kitsap County Sheriff Steve Boyer announced his candidacy to replace Boyer when the four-term sheriff leaves office at the end of the year.

Patrol Chief Gary Simpson, who’s been with the department for 29 years, announced Feb. 25 that he will run for sheriff this fall.

Boyer, 63, announced earlier this month that he will not run for re-election to a fifth term.

Simpson, 61, has been in charge of the Patrol Division since 2003. He is a graduate of South Kitsap High School who started with the sheriff’s office as a deputy in 1984.

In a news release, Simpson said maintaining community partnerships and good communication with citizens and sheriff’s office staff are among his priorities. The veteran officer has been involved as a volunteer with numerous community groups in Kitsap County .

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flexibility in how you structure your withdrawals — and this flexibility can help you potentially increase the amount of your after-tax disposable income. If you have a variety of accounts, with different tax treatments, you could decide to first make your required withdrawals (from a traditional IRA and 401(k) or other employer-sponsored plan), followed, in order, by withdrawals from your taxable investment accounts, your tax-deferred accounts and, finally, your tax-free accounts. Keep in mind, though, that you may need to vary your actual sequence of withdrawals from year to year, depending on your tax situation. For example, it might make sense to change the order of

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Social Security: Quality or quantity

By Jason R. Parker An affluent client who was quickly approaching age 62 recently asked my opinion about when he and his wife should begin taking Social Security. My initial response was based on much of the analysis I've done about how one can actuarially maximize Social Security benefits over two peoples’ lives. By understanding the rules and structuring Social Security in such a way that you are taking full advantage of all of the nuances within the system, a married couple can greatly increase the amount of benefits received over two peoples’ lifetime. Sometimes us geeky number guys are more concerned with

the math than the reality of how the choice impacts lifestyle.

This client pointed out that he and his wife have plenty of income from other sources and Social Security will just be an added bonus. He also pointed out that if he used the strategies we teach to maximize his Social Security benefits, it may mean he would receive more money from the Social Security Administration over both of their lifetimes, but most of that additional money would come much later in life.

He said, "If I start taking my Social Security at age 62, I have several very good years to really enjoy the extra infusion of cash. This extra money would afford us more travel and spending more time with our kids and grandkids. That additional income while we are young is much more important to us from a lifestyle standpoint than

What's your retirement vision? retirement won’t affect your finances much. But if you are particularly ambitious, and your volunteerism involves travel, renting space, purchasing equipment and so on, you might be looking at some large cash outlays. Furthermore, if you host people at your house, you may be incurring some types of liability risk, which you might need to address through appropriate insurance coverage.

Hobbies — During your working years, you may pursue your hobbies always with the thought that you can devote a lot more time to them after you retire. However, expanded hobby activities may involve expanded costs. For example, if you’re good with cars, you might decide to invest in that foreign sports car of which you’ve dreamed. Or, if you’re fascinated by genealogy, perhaps you’ll start traveling to places once inhabited by your ancestors. These types of activities can be expensive, so you’ll have to evaluate your sav ing, spending and investing habits to determine how to accommodate your increased expenditures on your hobbies.

Second career — Many people look forward to retiring from one career so they can start another — opening a small business, consulting or even taking a parttime job. Clearly, if you were to start your own business, some expenses would be involved, so you’ll have to plan for them.

Even if you become a consultant or work part time, you could incur various costs, including travel. And, in relation to these types of work, you may also have insurance and health care issues to address.

By identifying the various components of your retirement vision, and estimating their respective costs, you can make those saving, spending and investment choices that can help you work toward your retirement dream.

• Erin A brigo is an Edward Jones financial advisor in Gig Harbor.

really critical to the longevity of their resources.

Social Security benefits are taxadvantaged income, inflation-adjusted and have benefits for a surviving spouse.

In many cases a healthy couple retiring today will receive more than a halfmillion dollars in lifetime benefits from Social Security Administration. It is good to know the strategies for how to maximize these benefits, but just because you can doesn't mean you should.

• Jason Parker is president of Parker Financial LLC, a fee-based registered investment advisory firm working primarily 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. Parker is insurancelicensed and holds his series 65 securities license. He offers annuities, life and longterm care insurances as well as investment services. Follow Jason’s blog at www.soundretirementplanning.com.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 17

By Erin Abrigo When you start out in your career, you’re probably not thinking much about retirement. At this point, your picture of a “retirement lifestyle” may be, at best, hazy, hidden as it is behind a veil of experiences you’ve yet to encounter.

But as you move through the years, your view of retirement comes into clearer and closer focus — and this vision will have a big impact on your savings and investment strategies.

Consequently, to create and implement those strategies effectively, you’ll need to define your retirement vision by identifying its various parts. Here are some to consider: Travel — If you’re like many people, you may dream of traveling during your retirement. But what does “travel” mean to you? Do you envision taking a cruise or an international trip every year? Or is your idea of travel just a short jaunt to a popular destination, such as a lake or the mountains or the beach? The difference in costs between global and U.S.-based travel can be enormous, so you’ll need to define your goals and estimate your expenses.

Second home — Once you retire, you’ll have to make some housing-related decisions. Should you sell your home and “downsize”? Or do you want to keep your current residence and possibly purchase a second home, such as a condo minium, in another part of the country? Obviously, you’ll need to factor in these choices when you think about how to invest before you retire and how to manage your withdrawals from your 401(k), IRA and other accounts during your retirement.

Volunteer activities — You might think that your volunteer activities during

having an increased income when we are in our 80s."

I was reminded that a one-size-fits-all approach to retirement planning doesn't work. We really need to create a plan based upon your financial reality. Just because we can help you receive an additional $50,000 to $100,000 of Social Security income over your and your wife's lifetime, it may not matter if you are receiving the additional money at a time when you won't be able to enjoy it as much. Ultimately the question this couple was faced with was, "Do we begin taking Social Security early and enjoy a higher quality of life while we can, or do we wait to take benefits later so that we receive a higher quantity of money over our lifetime?"

Now the reality is this couple has the flexibility to ask these types of questions and make these choices because they have done an excellent job preparing for retirement. Because they are affluent, high net worth individuals who have really good retirement income, they have more options available to them.

I've also met with people where how and when they begin taking Social Security benefits is a determining factor for whether or not they are going to run out of money in retirement. So for many of the people we serve, the additional Social Security income later in life is

Scammers get creative in targeting seniors

18 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

By Rodika Tollefson When the phone rang in the early hours of morning, the elderly woman could hardly believe her luck. The caller, identifying himself as Gabriel Evans from the Justice Department, had wonderful news — she had won $400,000. All she had to do to claim the prize was send in $2,000 for insurance.

It sounded legit, even to a skeptic. The caller had the person’s correct name. The call was coming from a Washington, D.C., phone number and when called back, someone answered as the “Justice Department.”

The woman, being on fixed income, didn’t have the funds to send in — but plenty others have, not realizing, until too late, that “Gabriel Evans” is a fake. And such scammers are becoming so sophisticated that even the most street-smart and savvy people can fall prey to their fast, convincing words.

Surveys commissioned by the Federal Trade Commission estimate that 25 million to 30 million Americans every year are victims of fraud, and about 37 percent of people 45 and older said they’ve been a target. Seniors 65 and older comprise the majority of victims in lottery schemes, according to the AARP, and about half of the victims of all scams.

“The amount of interaction we have with senior citizens calling with concerns is significant. Often, their stories are heartbreaking,” said Washington State Attorney General Bob Ferguson, whose office is focused on consumer protection, among other things.

He said one of the most common scams is the one targeting grandparents —seniors getting a call from someone posing as a grandchild in need of money for bail, medical care or some other crisis. The caller begs the “grandparent” not to tell his or her parents and picks up on cues from the

conversation to make it sound legit. There may even be a second person like a “police officer” or “lawyer” to authenticate the information.

“We see this scam a lot and it obviously preys on a grandparent’s sense to want to help someone,” Ferguson said.

Sometimes seniors are more affected because of the onset of dementia, but even those who are still sharp can be gullible.

There’s also a correlation between negative life events and victimization, according to Doug Shadel, senior state director for AARP Washington and an expert on elderly-related fraud.

For more information To report fraud or get more information about consumer issues, call the AG’s hotline at 800-551-4636. For more information about fraud, go to atg.wa.gov and consumer.ftc.gov.

“A negative event creates stress and it eats cognitive capacity,” he said, comparing it to a weakened immune system being more likely affected by a cold virus.

The Kitsap County Sheriff’s Office receives reports regularly about scams and potential scams, including fake charitable solicitations for causes such as vests for law enforcement officers, according to Public Information Officer Scott Wilson. He said internet fraud is especially a problem for seniors.

Seniors who are less computer-literate are especially susceptible to email phishing or popup windows with links to fraudulent sites. “As you get older, you don’t adapt as quickly,” he said. “It makes older people an easier target when they have a bigger learning curve.”

Wilson said people often get caught up in the moment, especially since scam artists talk fast and convincingly, and he

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recommends taking a step back to reanalyze the situation.

“Always seek the advice of a third person if you have any doubts, and even when you don’t have any doubts,” he said. “Have a fresh set of eyes look at it.”

Family members can help protect seniors too, he said.

“The best thing is for children and (adult) grandchildren to be cognizant and assist with their parents’ and grandparents’ finances — just as a check and balance, especially if memory problems are setting in,” Wilson said. “Those who may be abused financially or emotionally need someone looking over their shoulder.”

There’s no easy way to have that conversation with an elderly parent, but Shadel said it’s a similar situation to when it’s time to take away the car keys.

“Looking from the outside in, (the behavior) may look irrational but that’s because you’re not under the spell of the scammer,” he said. “It’s important to do it nonjudgmentally and gradually.”

Ferguson’s 85-year-old mother is a good example. He said she’s still very sharp but she didn’t grow up with the internet, so he talks to her regularly about scams and reminds her that she can call her children any time before making financial decisions.

One of the seven siblings also keeps an eye on her financials. “Begin an honest conversation about it,” Ferguson suggested.

Scammers are frequently difficult to track, especially for things like bogus lotteries because they originate overseas.

But Ferguson said it’s critical for people to report to the Attorney General’s Office if they were a victim or a target because it helps with education as well as potential investigations. Wilson also encourages people to notify their local law enforcement office, which will also forward the information, when applicable, to the Federal Trade Commission.

The state Attorney General’s Office and AARP have a joint fraud watch network that helps discover new schemes and helps educate consumers. “Senior citizens are our eyes and ears on the ground,” Ferguson said.

Shadel noted that scammers are very adaptable and their schemes constantly evolve, so the most important prevention for consumers is not to wire or mail any money until they speak with someone they trust, not to give out any personal information and not to make emotional decisions.

“It’s unfortunate but you have to be skeptical,” he said.

STATES

you’ve worked for the state government, they may exempt it. In other words, you might not want to move out of state if you were a state worker.

Big spenders might consider these states — Now if you’re the sort of retiree who plans to spend a lot of money buying things in retirement, consider living in one of the five states that don’t impose a state sales-and-use tax: Alaska, Delaware, Montana, New Hampshire and Oregon.

For the record, 45 states and the District of Columbia impose a state sales-and-use tax, according to CCH, and some much more than others. So, big spenders might want to avoid moving to California, which has a state sales tax rate of 7.5 percent, and Indiana, Mississippi, New Jersey, Rhode Island and Tennessee, all of which have a state sales tax rate of 7 percent. It’s also wise to check other types of taxes that might affect you. According to CCH, local sales and use taxes, imposed by cities, counties and other special taxing jurisdictions such as fire protection and library districts, also can add significantly to your rate.

Most tax-friendly — When all is said, it would seem — by almost every measure — that Wyoming is the most tax-friendly state in the country for retirees. “It’s a low populace state and they’ve taken a very conservative approach to taxes,” said Weiner, who noted all the no income tax states ought to be viewed as the most tax friendly.

All things being equal, the other top taxfriendly states are Alaska, Florida, Mississippi, New Hampshire, Nevada, South Dakota, Tennessee, Texas, and Washington.

from page 13 income tax. According to Weiner, seven states fall into that category: Alaska, Florida, Nevada, South Dakota, Washington and Wyoming.

And two other states, New Hampshire and Tennessee, impose taxes only on dividends and interest (5 percent for New Hampshire and 6 percent for Tennessee.)

Consider also states that have a relatively low income tax rate across all income levels.

For example, the highest marginal income tax rates in Arizona, Kansas, New Mexico and North Dakota are below 5 percent, according to Weiner. And some states have a relatively low flat tax regardless of income, with the three lowest being Indiana (3.4 percent), Michigan (4.25 percent) and Pennsylvania (3.07 percent) for 2014. And, according to Weiner, the Illinois flat tax rate will be reduced from 5 percent to 3.75 percent in 2015.

States to consider if you rely mostly on Social Security and pensions — But what if you’re more an average retiree household, where 36.7 percent of your income comes from Social Security, 30.2 percent from earnings, 18.6 percent from a pension and the balance from your accounts earmarked for retirement? In this case, you might consider moving to a state that doesn’t tax Social Security and private pension income.

Those 10 states are Alaska, Florida, Mississippi, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming.

For the record, Weiner said many states may tax all your pension income, but if

March 2014 Edition

Events And Activities VISIT the NEW HBA Website! www.kitsaphba.com On Line Registrations!

Monday-Wednesday March 3-5 BIAW State Directors Board Meeting Olympia Tuesday, March 4 Pen. Home & Garden Expo Cmt. Mtg. HBA, Noon Lunch Provided Wednesday, March 5 Kitsap HBA Remodelers Council, 4 p.m.

HBA Thursday, March 6 Developers Council, 7:30 a.m.

Thursday, March 13 HBA Closed for Expo Set-up Friday-Sunday, March 15-16 Pen. Home & Garden Expo Friday 2 p.m. - 8 p.m.

Saturday 10 a.m. - 6 p.m.

Sunday 10 a.m. - 5 p.m.

Monday, March 17 HBA Closed for Expo Tear-down Thursday, March 27 Executive Committee 2:00 p.m.

Government Aff. Cmt. 2:30 p.m.

Board of Directors 3:30 p.m.

• • • • • •

Membership Fact #3: As members you get discounts!

10% off booths in our annual Expos Ad discounts in NEW Build & Remodel magazine Save at Staples and Office Depot $500 off GM Vehicles Discounts on car rentals Save on Flowers & other Gifts

It all adds up!

Members ONLY — To be entered to win the quarterly drawing, please email tosinski@kitsaphba.com and put this in the subject line: “Membership Fact #3 News”

Peninsula Home & Garden Expo — Check out what’s NEW! Even though the weather took a significant turn for the worse after the groundhog saw his shadow in early February, Spring really is just around the corner. From Master Gardners on site all weekend to almost 2 dozen garden/landscape related vendors as well as outdoor landscape displays to spark your creativity, we have put the “garden” back in Home & Garden. With other local Expos pulling up stakes this year (Kitsap Sun Women Today Show, and the Bainbridge Island Home and Business Expo) you are not going to want to miss the Peninsula Home & Garden Expo at the Kitsap County Fairgrounds. This annual, fun event is proudly brought to you by the HBA, Kitsap Sun, Kitsap Credit Union, and Wave Broadband.

As always we will have an incredible assortment of vendors from the region to talk to you about every possible project you have in mind for your home or garden.

Sign up for an informative tour of the onsite rain-garden and find out how you might be eligible for a rebate if you put one in your own yard! Enjoy an array of professional FREE seminars including how to start your own Home Brew. Join Sound Brewery’s Head Brewer Brad Ginn at 6 p.m. Friday, March 14 to learn all about it! Beer not your thing? We have seminars all weekend and there is sure to be several that are of interest to you (www.kitsaphbahomeshow.com). Our seminars are proudly sponsored by Puget Sound Energy. By the way, if you want to attend several seminars but they are on different days, not to worry! NEW this year we have the All Access Pass. Buy an All Access Pass for just $10 and enter the Expo day after day using your pass (one discount admission coupon can be applied against this pass price).

All day Saturday and Sunday be sure to stop by and enjoy the creative genius of the Second Street Cabin Chainsaw Carvers (as seen on TV and promoted by the Bob Rivers Morning Show on KJR FM). You’ve seen chainsaw artists before but nothing like this NEW feature to the Peninsula Home & Garden Expo.

Be sure to register your 5 - 12 year old for our NEW Lego™ Building Challenge!

Advanced registration for this exciting new event is required as space is very limited.

Registration forms can be found on the Expo website at www.kitsaphbahomeshow.com or you can call the HBA office 360-479-5778 and we will email the form to you. All registered children between 5 and 12 years old will compete in age-appropriate groups in a timed construction challenge using Legos™ provided by the Expo Management. The Challenge will take place on Sunday, March 16 in the President’s Hall. Each age-category winner will be awarded with an age appropriate Lego™ set to take home! This event is made possible in part by the generous contribution of Air Masters, Inc. Children 12 and under always enter the Expo free when accompanied by an admission paid adult.

Don’t miss the Habitat for Humanity Surplus Sale! This annual sale is a great opportunity to pick up incredible deals on materials for your remodel, rental property, garden, workshop and so much more! New stuff is brought in every day, so be sure to consider the All Access Pass as mentioned above and come and go as you please! This sale is a feature of this Expo and to enter the sale you must purchase an Expo admission.

NEW this year — Scavenger Hunt! Visitors to the Expo will have a chance to win one of several $50 value prizes! Winners will be named each day from that day’s completed cards. Be sure to snip out the Expo Scavenger Hunt card from the Official Expo Guide, or pick a card up when you enter the Expo to participate in this new, fun way to enjoy everything the Expo has to offer. As you work your way through the Expo you will seek out the vendors on the card, get a stamp and when your card is full turn it in for a chance to win a $50 value.

As always watch for discount admission coupons all over town, in the Kitsap Sun, and on the HBA and Expo websites.

THE 2014 FORD F-SERIES TRUCKS MORE POWERFUL, CAPABLE & ADVANCED.

PORT ORCHARD FORD

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

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2014 OFFICERS President . . . . . . . . . . . Judy Mentor Eagleson First Vice President . . . . . . . . . . . . Kevin Ryan Second Vice President . . . . . . . . . . . Jim Heins Treasurer . . . . . . . . . . . . . . Randy Biegenwald Secretary . . . . . . . . . . . . . . Dee Coppola, CGA Immediate Past Pres. . . . . . . . . . Robert Baglio

2014 BUILDER & ASSOC. DIRECTORS Karla Cook • Walter Galitzki • Stuart Hager Joe Hurtt • Berni Kenworthy • John Leage Leslie Peterson, CGA, Jim Ullrich Miriam Villiard • Jim Way, CGB

2014 STATE DIRECTORS Robert Baglio • Judy Mentor Eagleson Jim Heins • Joe Hurtt • Justin Ingalls, RCS Wayne Keffer, CGR, CAPS Ron Perkerewicz • Kevin Ryan

2014 ALTERNATE STATE DIRECTOR Dale Armstrong • John Armstrong Kevin Hancock • Brent Marmon

LIFE STATE DIRECTORS Bill Parnell

2014 NATIONAL DIRECTORS Judy Mentor Eagleson • Jim Heins Shawnee Spencer

2014 ALTERNATE NATNL. DIRECTORS Michael Brown • Jeff Coombe

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

2014 COUNCIL & CHAIRS Build a Better Christmas . . Randy Biegenwald Built Green . . . . . . . . . . . . . . . . Walter Galitzki

By Laws & Nominations. . . . . . Robert Baglio Developers Council . . . . . . . . . . Byron Harris Golf Classic . . . . . . . . . . . . . Shawnee Spencer Govt. Affairs Cmte. . . . . . . . . . . . . Kevin Ryan Remodelers Ccl Chair. . Wayne Keffer, CGR, CAPS Membership. . . . . . . . . . . . . . . . . . . . Jim Heins Parade of Homes . . . . . . . . . . . . . . . . . . . . TBD Peninsula H&G Expo . . . . . . . . . . . Lena Price Peninsula H&R Expo . . . . . . . . . Dee Coppola

HBA STAFF Executive Vice President . . . Teresa Osinski, CGP tosinski@kitsaphba.com Administrative Coordinator. . . Kathleen Brosnan info@KitsapHBA.com Events and Administrative Assistant . . . Katie Revis hbaevents@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

March 2014 Edition

Don’t Get Shocked on Judy Mentor your Next Inspection

Eagleson

As part of our monthly Board meetings we ask our members, “What’s going on 2014 President out there?” We then have a roundtable discussion about the things affecting our members. During one of these roundtables, a member raised concerns about Labor and Industries (L&I) electrical inspections.

Several other members expressed similar concerns. There is a statutory requirement for L&I to respond within 48 hours of an inspection request, and that requirement is not being met. Our builders, and their customers, are frustrated. Thus, a small group was tasked with reaching out to L&I on this issue.

We had the opportunity to meet with Rod Mutch, Chief Electrical Inspector and Doug Griffith, Electrical Inspector / Compliance Supervisor for L&I. As it turns out, L&I was aware of the problem, the ripple effect of delayed inspections, and is working to find solutions.

The first issue is the budget. L&I is funded by permits, license fees, and citation penalties. Mr. Mutch and Mr. Griffith both insisted that re-inspections are typically money losers. While L&I has a dedicated electrical budget, spending money for that purpose requires legislative approval. L&I proposes a budget, planning for the best and worst case scenarios, and then adjust to actual conditions.

With the uptick in the economy, and the increase in building, the number of inspections in 2013 increased by 12% - creating a significant workload increase for L&I. This resulted in inspection delays for builders. According to Mr. Mutch, 87% of inspections are completed within 48 hours, and L&I’s goal is 94% completion within 48 hours.

The good news is that L&I is bringing on 8 additional permanent inspectors — one of which will be permanently assigned to Kitsap County. The new inspector for Kitsap County has been hired and is now in training. L&I has also made a request in this year ’s supplemental budget to hire 16 additional inspectors and 1 technical specialist. All without increasing fees.

L&I is going through the LEAN process similar to what the Department of Community Development went through, very successfully, last year. LEAN simply means creating more value for customers using fewer resources. Optimizing service while eliminating waste is not a cost reduction program, but rather a new business model for the entire organization.

An update of their electronic operating system, how they track permits and inspections, is also in the works. This is a two to three year process. The new system will be compatible with iPhones and iPads, giving the inspectors mobile technology and hardware.

Mentor Company

They are working on the issues on their end — what can we do to help?

As it turns out we are not good communicators. For example, when submitting your permit, did you give a complete address with detailed directions? Are these directions from a major arterial roadway? Is your site well marked? Also be sure to give specific information. What would you like inspected? Where is it located?

How do you get there? Is the access elevated, and if so, do you have approved access methods? The more information the inspector has the quicker the inspection can be made, and the quicker the inspector can move on to the next location.

Finally, did you mark “please call first”? Do you really need a call? If so, are you available to take that call? It takes an inspector time to place these calls, and if the call is placed and no one answers, your inspection will not be scheduled for that day.

What other improvements can be made? L&I is holding a stakeholders meeting on March 18th at the Bremerton Chase Building from 6 to 8 p.m. Please let us know how things are working for you. Be part of the process, and thus part of the solution.

Consider Sponsorships for 2014 and beyond The Home Builders Association of Kitsap CGP County holds many Executive important fundraiser and Vice President social events each year and we rely on the generosity of our members to make them successful. Members’ participation is important and so are sponsorship dollars.

Through the sponsorship support of our members the HBA is able to off set the costs associated with important events like the annual Affordable Housing Council auction, the Builders Classic Golf Tournament, and each of our two annual Home Expos.

This year the Affordable Housing Council’s auction will be on Friday, June 6 and with its “Rodeo!” theme it is sure to be fantastic. We can use sponsors for the banquet, dessert, decorations, and so much more! Sponsorship dollars go to the HBA to offset the expenses associated with putting on the dinner and theme. The annual Builders Classic is scheduled for Friday, July 11 at Rolling Hills Golf Course. The committee will begin meeting soon and we are always in need of creative, energetic folks to help. Sponsorships for this event include banquet, golf carts, beverage carts, driving range and hole sponsors (18 sponsors needed). The sponsorship levels vary from just $50 (shared golf cart listing) to $500 (exclusive banquet). Join us on the course at a Hole Sponsor and meet every single golfer during the event! We encourage theme activities at each hole — this is one of the “funnest” golf tournaments you’ll ever participate in! Join the committee and help select this year’s theme! In addition to AHC Auction and the Builders Classic, the HBA holds two essential Expos each year. Sponsorships for these events are very important to help the HBA control the expense side of the fundraiser and your support is rewarded with name recognition in print and in television advertising, and with vendor space in the Expo.

Sponsorships begin at just $1,000.

If you have an idea for how your company might sponsor an HBA event, please do not hesitate to call and share your concept with me. I am open to new ideas and want to ensure that where we can, we are offering ways to include our members to benefit our membership. We hold two “Nothing But Fun” socials each year and to-date we have not solicited any sponsorships for those. If you think your company might be interested in being the exclusive sponsor of one or both of these events, please let me know. In May we will be holding our second annual joint luncheon with the Kitsap County Association of Realtors. The specifics are still being ironed out but an exclusive sponsor might be an option to discuss. I’d be happy to consider it.

Sponsorships are very important to the financial bottom line of the HBA and we encourage each of you to think about how you might be able to participate. As the auction committee and the gold tournament committee are about to get started on their efforts please take their calls and consider thoughtfully how your company can help support the HBA with a sponsorship. We appreciate all that you contribute and all contributions allow us to advocate for this essential element of our economy.

Teresa Osinski

March 2014 Edition

Government Affairs Committee

Revamp the Nest

As I listen to the relentless downpour one lazy Sunday afternoon I am reminded of how fortunate we are to have Kevin Ryan much needed rain and time to Tim Ryan Construction discuss some projects we have planned for our home. They say 2014 Chair your home is your castle, but my wife and I tend to refer to it as “the nest.” Take a moment to enjoy your time as you shelter yourself during these winter storms and make your list of ways you can improve your nest this year, with local HBA Member Contractors.

My wife and I attended a local home show this weekend which gave us a chance to not only beat the wet weather but also narrow down a short list of improvements to our 14 year old nest. I am sure many of you can relate to our situation as the kids get past or close to leaving home.

So if you ask yourself a few questions first, it may just help get you inspired to take action; 1. Do the cabinets close like they used to?

2. Do the faucets now drip in unison to each other?

3 Are you starting to take bets when your dishwasher will give up the ghost?

4 Maybe you just want to improve your curb appeal with new landscaping?

5. How about that budget carpeting you so proudly purchased when it was new?

6. Is it time for the “P. lam” counters to now give way to granite?

7. Has the Microwave finally shuttered for the last time?

8. Are the complaints about the toilet more than just the seat being left up?

If you either answered yes to any of these questions or just pondered a bit you’re in luck. March 14-16 this year the HBA is having its annual Peninsula Home & Garden Expo at the Kitsap County Fairgrounds. The show is a wonderful way to meet with our local contractors and vendors face to face to discuss your plans and get you on your way.

What better time than this year? Best of all you help our local economy in the process.

Vendors at the Expo look forward to this event each year and the timing could not be better. As construction activity is now on the rise Nationwide and locally. Permit Activity is up state wide so early planning now will help you and your contractor work through the details of your project and get things locked and loaded before the typical Spring/Summer rush begins.

The event is full of seminars where you can learn a variety of topics related to improving your home or garden. Bring the family down or surprise your spouse or friend with an escape from the winter blues and start getting your nest back into top form. For full event information visit the Expo website at www.kitsaphbahomeshow.com and begin revamping your nest this year.

Government Affairs Committee Meeting 2014 Schedule Last Thursday of each month 2:30-3:30 p.m. at the HBA Office in Bremerton Periodically extra meetings are added or the standard meeting is extended, or moved. Please watch the HBA online calendar for the latest info or your monthly events postcard.

As Seen in the BIAW Lawmaker Review

Smokey Revenue Forecast In late February, the state’s Economic and Revenue Forecast Council announced modest changes to the state’s tax revenue forecast — increasing tax revenues by $30 million for the current 2013-15 biennium and $82 million for the 2015-17 biennium. In announcing their updated forecast, the council identified again possible disruptions to the housing recovery as risks to the state’s economy and tax collections.

The Council commented that in its view, the housing construction market rebounded in the fourth quarter of 2013 after slumping somewhat in the middle of the year. For 2013, it appears new housing permits, both single and multi-family rose to 34,600 through November 2013. However, the Council said “single-family permits were a little disappointing” with new singlefamily construction starts in the state coming in at about 18,300 units, below the previously projected forecast of 19,400 for 2013.

Additionally, the revenue forecast includes smoky projections about the tax collections associated with the legal sale of marijuana. The state rolled into their 2015-17 biennium $51.2 million in projected marijuana-related tax revenues and then a much higher $138.5 million revenue stream in the 2017-19 biennium. A 25 percent tax is baked into each of three product channels which include manufacturing/growing, distributing and retail selling of marijuana.

From NAHB Eye on Housing February 2013

Construction: Important Economic Driver not Capitalized on By Washington State Policies Recent NAHB reports and data show that as a total percentage of the nation’s gross domestic product construction makes up just over 15% with just over 3% from the residential construction sector. Data for Washington State’s construction market indicates that in 2012 (most recent data) our construction market, as a percentage of Gross State Product, was the lowest of all the Western States with the exceptions of Oregon and California where construction made up less than 3%. However what is of greater concern is how the sector is impacting Gross State Product as the market is returning and on that point Washington is fairing even worse. According to NAHB, every single Western State (including Oregon and California) has shown greater growth in this sector (2012 over 2011 activity) compared to Washington’s activity (the exception being Arizona with a decline). It will be interesting to see if the 2013 data, when available, indicates an improving shift.

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March 2014 Edition

Welcome New Members Edge West LLC Kevin G Abrams 1386 SE Lund, #16 Port Orchard, WA 98336 (360) 551-2318 (360) 519-3190 fax kevinabrams@gmail.com

The Property Group Brendan McGeer 911 Hildebrand Lane NE, Suite 102 Bainbridge Island, WA 98110 (206) 855-1131 (206) 855-0990 fax BrendanM@PropertyGroup.net

And the SPIKE goes to...

And the SPIKE goes to...

Justin Ingalls Kitsap Trident Homes

Joe Hurtt Kingston Lumber Supply Co.

Pyramid Materials Jim Haskins 8857 Dickey RD NW Silverdale, WA 98056 (425) 254-1820 (425) 254-1821 fax jhaskins@pyramidmaterials.com And the SPIKE goes to...

Larry Todd Hard Rock Inc. Unique Experience Ronald Flemister 329 N Callow Ave Bremerton, WA 98312 (360) 373-2076 (360) 415-1279 fax Un234@silverlink.net And the SPIKE goes to...

Jim Heins Jennings-Heins & Associates, Inc.

NEW Affiliate Member* Guild Mortgage Joan Qvigstad 19325 Jensen Way NE Poulsbo, WA 98370 (360) 200-6590 (360) 859-2061 fax jqvigstad@GuildMortgage.net And the SPIKE goes to...

Carolyn Frame Guild Mortgage

* An Affiliate Membership is for dependents of a current member company that want the full NAHB membership benefits.

Thank You Renewing Members 45 Years or More Cascade Natural Gas (47) Evergreen Lumber Inc. (45) Over 40 Years Land Title Company (44) Over 30 Years Heritage Fireplace Shop 25 Years or More Olympic Property Group (26) Northwest Cascade Inc./ Honey Bucket Wet Apple Media

Over 10 Years Camp Corporation (14) Hanson Sign Company (14) Sound Plumbing (11) Over 5 Years Pacific Kai Homes, LLC (9) Kitsap Sun (6) Over 1 Year BDH Holdings, LLC Lakeside Industries Inc.

Over 15 Years Kitsap Garage Door (17)

IS STARTING YOUR OWN BUSINESS A RETIREMENT DREAM? Bring your questions. Let’s talk.

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NAHB Member Advantage — SAVES YOU MONEY

Member Advantage

www.nahb.org/ma As members of the HBA you are also members of the National Every Year Thousands Association of Home Builders.

NAHB has created an important Save Millions! member benefit program called the NAHB Member Advantage and it includes many national companies that offer members a discount on their buying activities. The list of participating companies does change from time to time so you are encouraged to log into the NAHB website to stay up to date on all the Member Advantage benefits.

Visit www.nahb.org/ma to learn more but here is a summary of companies that are currently participating: • Lowe’s — Visit www.LowesForPros.com/NAHB to register to save 2% on their LAR plus get free delivery of orders over $500. Did you know you can save an additional 5% when you mention it in the store while using your LAR? SAVE 7%! Check out HBA member Silverdale Lowe’s for all the details.

• General Motors — $500 Exclusive private offer on most Buick, Chevrolet, and GMC vehicles and if you own the business you’re listed as the primary member for, you may also qualify for $1000. Check out HBA member Haselwood GMC for details.

• UPS Savings Program & YRC Freight — UPS discount up to 36%! Save as much as 70% off some YRC shipping options.

• TransFirst (formerly Solveras) — Check them out for a variety of payment solutions from credit card and eCheck processing to other check services including Web/mobile tools.

• Dell — Save up to 30% off top of the line Dell computers.

• Liberty Mutual — Auto and Home Insurance options.

• Hertz, Avis, and Budget — All offer members special rental rates!

• Hewlett Packard — A variety of great discounts on various products from notebooks to servers and so much more! www.hp.com/go/nahb • Office Depot — 10% off your delivery orders and free shipping if the delivery order is more than $50. www.officedepot.com/nahb • Omaha Steaks — Save 10% off all on-line promotions at www.OSincentives.com/promo/nahb.

• Endless Vacation Rentals — Check out all the destinations and the wonderful savings at www.endlessvacationrentals.com/nahb • Wyndham Hotel Group — Over 7,400 hotels and resorts offering an additional 15% off the best available rate. www.nahb.org/ma and click on the Wyndham logo.

• FTD — The HBA uses this discount several times each year! Check it out! Save 20% off floral arrangements & gifts. Visit www.ftd.com/nahb.

• NAHB Career Center — www.nahb.org/careers - 20% off standard rate fro job posting & 15% off other HR services.

• Associated Petroleum Products (APP) — Members can earn $.015 for every gallon purchased using the APP Fuel Card program. Visit www.associatedpetroleum.com/nahb to enroll and learn more.

Daily E-mail Updates It’s FREE for everyone!

Even if you’re not a Business Journal Subscriber

It’s easy to sign up!

Just visit daily.kpbj.com and sign-up for our emailer to start receiving breaking area news stories right in your inbox. For more information call (360) 876-7900.

Third Coffee Oasis location fills one of Port Orchard’s vacant spots The Coffee Oasis 807 Bay St. in Port Orchard Hours: 5 am - 7 pm M-Th 5 am - 9 pm Fri. 8 am - 3 pm Sat.

The Coffee Oasis was set to open its new location on Bay Street in Port Orchard on March 1, after months of efforts by volunteers to renovate the former Bay Street Ale House building. Jesse Westwood, shown at the service counter, will manage the café operation and there will be a separate youth center on the second floor.

She said the organization is thankful for all the helpers, and particularly praised the yeoman efforts of Rotary members and volunteers from Hard Hats for Christ, a Kelso,Wash.-based ministry that helps build and remodel churches, camps and other facilities for faith-based groups.

The Coffee Oasis, which began in 1997 and also has locations in Bremerton and Poulsbo, first came to Port Orchard in 2009 when the organization bought the Solid Rock Café on Bethel Avenue. That lasted three years, but Stanley said the organization decided to look for a site more suited for their operation.

The new location on Bay Street is a much better fit, she said.

“The arrangement of having facilities upstairs (for youth services) and downstairs having a coffee shop is a good way to start,” Stanley said.

The owner of the Port Orchard building, Mansour Samadpour (who owns

Restaurant Space For Lease

other downtown properties including the market opening soon in the next block), waived the first three months of rent during the renovation. Stanley said they had hoped

to have the café open in December to start generating revenue.

The Coffee Oasis operates its cafés — which serve a breakfast and lunch menu along with a variety of coffee drinks — to fund its programs working with homeless and at-risk youth. The cafés also provide job training and work experience opportunities for youth.

The organization buys coffee beans from growers in numerous countries through a Direct Trade program and has its own roasting facility at its Bremerton location. It also offers catering services, which was provided for Rotary’s Bay Street Bash.

The Coffee Oasis does outreach on the streets and in schools, welcomes youth to its drop-in centers for meals and socializing, and provides case management. The Bremerton location also has an overnight shelter with eight beds for homeless teens.

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March 2014 Kitsap Peninsula Business Journal • KPBJ.com 23

By Tim Kelly, Editor The Coffee Oasis will serve its namesake beverage brewed from locally roasted beans, and continue serving the needs of street youth, at its new Port Orchard location that opened March 1.

In the days leading up to the “soft opening” of the café at 807 Bay St., volunteers were putting finishing touches on walls, floors and kitchen equipment in the space that used to be Bay Stree Ale House until that business closed in 2011.

A host of volunteers have helped with renovation of the two-story building, which will have a separate youth center on the second floor above the café.

South Kitsap Rotary members have done a lot to support the project, and the club held its third annual Bay Street Bash just down the street on the same night The Coffee Oasis opened. Rotary president Jim Way said the event will benefit for the youth ministry again this year.

“Last year we raised $10,000 for Coffee Oasis, and put that toward a Gates Foundation matching grant for homeless youth,” said Way, who with his brother Jeff owns Pristine Homes in Port Orchard.

“We’re hoping to better that 10 grand this year, and we’re looking into whether the Gates Foundation is still offering that grant.”

He said the Port Orchard Morning Rotary also did fundraising, and the contributions from the two clubs and the grants “basically bought all new kitchen equipment.”

Other community groups and businesses donated labor and materials for the monthslong project, which took longer than expected because the century-old building needed more repairs and renovation than anticipated when volunteers started clearing the place out and pulling off old paneling and flooring last summer.

“It’s been almost entirely volunteer,” Coffee Oasis facilities coordinator Helen Stanley said, even the electricians and plumbers needed to handle specialized repairs.

Reinvented restaurant opens in Poulsbo

Longtime Hallmark store closes in Port Orchard

The transformation of a popular restaurant in downtown Poulsbo is complete, and the Green Light Diner opened in early Feburary. Owners John and Laura Nesby operated the place for 10 years as Mor Mor Bistro, but they closed it at the end of 2013 and worked with designer Michelle Doyle to redesign and remodel the space completely to create their new retro-look diner.

McBride’s Hallmark, a family-owned business since the 1960s, was set to close its store on Lund Avenue by the end of February. Owners Scott and Stacy Ryan could not be reached for comment.

They are also closing their Hallmark store in Oak Harbor, while three others in Silverdale, Poulsbo and University Place will remain open.

Kitsap County releases new parcel search application

adds many new features. The map screen is now a full-screen map, and maps can now be printed to portable document format (PDF). Users can draw shapes and text on the maps that show up when maps are printed. Imagery is available from 2012, 2009, 2007, 2005, 2001 and 1994, which helps users see how parcels and areas have changed over the years. There are also several layers to choose from to display on the map including the Comprehensive

Plan, critical areas, county utilities, critical aquifers, shoreline management and more.

“Adding these enhancements helps residents find information they need and increases the usefulness of parcel search applications,” Mark added. Users can access the parcel search from the county’s home page (www.kitsapgov.com) or go to https://psearch.kitsapgov.com/webapp/.

For more information, go to http://www.kitsapgov.com/gis/.

L&I sets local meeting with electrical industry stakeholders

questions and get answers and clarifications.

This meeting has proven to be an important tool in communicating with the electrical industry and will offer an opportunity for customers in the industry to ask questions directly to the Electrical Program and get feedback. There is no cost to attend and refreshments will be available.

Labor & Industries is a state agency dedicated to keeping Washington safe and working. For more information or to schedule training at your facility, call Carilyn at 360 415-4044.

Kitsap County has released a new version of its online parcel search.

“Many of the enhancements that the public and county staff requested, such as a

larger map view and multiple data layers, are now available,” said Diane Mark, Geographical Information Systems (GIS) manager. The existing parcel search application, which has been in use since 2002, is based on older GIS software technology and needed to be replaced.

The new Parcel Search application provides all the existing capabilities and

Windermere Real Estate/West Sound, Inc. 24 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Serving Poulsbo, Silverdale and Bremerton

PROPERTY FOR SALE OR LEASE Poulsbo CBA#509029 $239,000 BUILD FOR LESS THAN LEASING. Build-to-Suit opportunity in Poulsbo across from new Safeway.

Approved for 4,790 sf building. Perfect for medical or financial services user. Great visibility with views of Olympics. Kelly Muldrow at 206-949-3420 or Joe Michelson at 360-282-5340.

Bremerton CBA#529362 Excellent new, high quality concrete tilt-up bldg in high traffic + visibility corner location w/immediate freeway access. 4 spaces avail & sizes range from 1500–5772 sq.ft. Office, retail or industrial. $13.00/SF NNN. Mark Danielsen 360-509-1299. $1,125,000 Clear Creek CBA#587592 Fully occupied 12,120 sq.ft. contractor warehouse & storage facility on 2.5 acres on Rural Comm’l zone bet Poulsbo & Silverdale. Two add’l bldg pad sites for approx 2,700 sq.ft. bldgs. Owner occupies 2,400 sq.ft. – May stay or go. Mark Danielsen 360-509-1299.

Bremerton CBA#523985 $250,000 This .58 acre with Village Commercial Zoning allowing many retail and office uses. Fully graded with all utilities available. Adjoins State Hwy 3 to the west and The Summit Apartments to the south.

Victor Targett 360-692-6102/360-731-5550.

Kingston CBA#218220 Built out office space in a retail center. Great visibility to Hwy 104. Former Real Estate office.

Joe Michelsen 360-509-4009.

Silverdale CBA#573886

$256,880

Great location for retail or office use; currant use is real estate service companies. 5,000 square foot expansion area (second lot) is available at additional cost. View of Dyes Inlet. Bob Guardino 360-710-7844.

Bremerton CBA#512042

$850,000

Multi use building on Pacific Ave in downtown Bremerton. 3 commercial suites and 11 residential units and the adjoining 53 space parcel parking lot. Solid cash flow investment. Victor Targett 360-731-5550.

CBA#531684

$750,000

Commercial corner in Poulsbo approved for convenience store with gas, fast food & car wash.

Port Orchard CBA#503406 Great retail or office location on corner of busy intersection. Bob Guardino 360-710-7844.

Signal light at corner. Sewer water available.

Joe Michelsen 360-509-4009.

The state Department of Labor & Industries is hosting an electrical industry stakeholders meeting on March 18 from 6-8 p.m. at the Bremerton L&I building at 500 Pacific Ave. Information will be provided about current changes to electrical codes, rules and regulations. Anyone involved in the electrical Industry is encouraged to attend. Attendees will be able to ask

Selling to the government – Where do I find my government marketplace?

By Mary Jo Juarez, PTAC Counselor You are registered in the System Award Management (SAM) and ready to sell!

Who do you talk to? Who buys your products and services? How do you figure out where to go?

There are a variety of online sources and individuals who are willing to help you through the maze of determining the government agencies to approach.

The Small Business Administration (SBA) has classes, counselors and networking events. The Washington State Procurement Technical Assistance Center (PTAC) offers a variety of classes, one-on-one counseling and outreach events. There are eight PTACs in the state, including the Kitsap Economic

Stillwaters Environmental Center to begin planting green roof project

County seeks CK rep on Board of Equalization The Kitsap County Board of Commissioners is looking for a new District 3 representative for the Board of Equalization, an independent group that hears appeals on property tax determinations made by the County Assessor. The board also hears appeals of other Assessor determinations including denials of home improvement and personal property tax exemptions, historic property and forest land classifications and current use. Ideally, applicants will be familiar with Kitsap County real estate or appraisal practices.

A detailed position description is available at www.kitsapgov.com/ volunteer/boards/BOE.htm. For more information, contact Kitsap County Volunteer Services at 360.337.4650 or rpirtle@co.kitsap.wa.us.

and environmental services.

Naval Undersea Warfare Center (NUWC) Keyport purchases everything except construction services (see NAVFAC above), with the majority of their dollars going to professional services such as IT and electronics.

Naval Supply Systems Command, Fleet Logistics Center, Puget Sound contracts for ship repair services, engineering services, industrial supplies, equipment repair, equipment rental, furniture, administrative services, telecommunications for Naval Base Kitsap, Navy Region NW, PSNS/IMF, and Ship Repair Facility Yokosuka, Japan (to name a few.)

Each of these commands has local representatives who are willing to help small business navigate government contracting. Your Kitsap PTAC office at KEDA can assist you with this.

Keep in mind that the government purchases products and services that you might not even think of, such as horse logging and goat grazing. How do you figure out how to find the right agency when it’s not readily apparent? Attend classes and outreach events, research the internet, and ask, ask, ask as you attend classes and become familiar with government jargon and people. Work with the SBA, PTACs and small-business individuals representing large prime

contractors and agencies.

There are several large conferences coming up in March. The Washington State Alliance NW Conference is the largest small-business (procurement) conference in the state, with multiple agencies and prime contractors looking for small businesses. Information about this conference can be found at www.alliancenwconference.org. Plan your attendance strategically as this conference is large and well attended. Research the event website and focus on those buyers who are interested in what you sell. PTAC offers an online webinar aimed at helping you plan your time at this conference — you can view it at https://www.youtube.com/watch?v=OF TA9KrTV1k.

Your local Kitsap PTAC located at the Kitsap Economic Development Alliance (KEDA) can also assist you. Upcoming PTAC classes are found on the KEDA website (www.kitsapeda.org). We looking forward to hearing your success stories in government contracting!

• Mary Jo Juarez has over 30 years’ experience in government contracting; most recently working as a Navy Deputy for Small Business, helping the Navy meet their small business goals and educating small firms in obtaining certifications, marketing and opportunities with the federal government.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 25

Stillwaters Environmental Center in Kingston will begin its Planting a Green Roof project on March 23 at 1 p.m. The center is looking for volunteers to with the planting, especially individuals able to lift and climb.

This is an opportunity to participate in a new way of building while helping the community. For those wanting to watch and learn, time will be spent talking about how the project is being implemented and information will be handed out.

Anyone who would like to get involved, or be an observer, should contact Naomi Maasberg at 360-297-1226 or naomi@stillwatersenvironmentalcenter.org.

Stillwaters Environmental Center (stillwatersenvironmentalcenter.org) is located at 26059 Barber Cut Off Road in Kingston.

Development Alliance Center, all with counselors experienced in many areas of government contracting. You are welcome to work with more than one PTAC center as counselors have varying areas of expertise.

Your PTAC counselors are excellent sources of information and will suggest who to approach with your product and services. They will also review your marketing materials to ensure they are in the correct format and include the requisite information. Marketing materials for the government are different than marketing materials for private industry — we will address this in a future column.

In the interim, you can find examples and templates on the KEDA website.

In Kitsap County, Naval Base Kitsap covers NBK Bremerton, NBK Bangor and NBK Keyport. Each base has multiple Naval Commands, including Puget Sound Naval Shipyard and Intermediate Maintenance Facility, all of which purchase different products and services.

Navigating this system can be totally overwhelming, so let’s examine three different commands at NBK Bremerton, Bangor and Keyport.

Naval Facilities Engineering Command NW (NAVFAC NW) is located at Bangor and is responsible for construction, architect-engineering services, facilities base operating services,

Planning for Silverdale performing arts center moves ahead

By Rodika Tollefson Kitsap County and the nonprofit West Sound Performing Arts Center have signed a letter of intent for construction and operation of the arts center on the site currently home to Silverdale Community Center.

Exact plans for the arts center are still in the works, and organizers have already obtained nonprofit status. The letter of intent, which is nonbinding, specifies that should WSPAC obtain funds to build, the county will lease the land at nominal cost.

The agreement is similar to what the county had in place with the YMCA of Pierce and Kitsap Counties for the Silverdale YMCA. Should fundraising for construction of the arts center be successful, the county will pay to demolish the existing Silverdale Community Center, which includes CSTOCK community theater, and will relocate the nearby sheriff’s substation. In return, WSPAC agrees to dedicate space in the new building for Kitsap Regional Library’s planned new Silverdale branch, should KRL select that location as the final choice.

Michael Stowell, president of West Sound Performing Arts Center, said typically organizations are further along with plans before making a project public, but since they needed to make a deal with the county, the project was announced before costs were known.

What the group does know is that they

are considering three sizes for the theater, ranging between 400 and 900 seats for the main auditorium and between 200 and 350 for a black box theater.

“We envision a two-part facility with a large theater and a smaller, black box theater that is amenable to configuration,” Stowell said.

The final choice will be based on fundraising, which could include a mix of private funding, grants and state funds.

Stowell said the center would not compete with the Admiral Theatre in Bremerton but complement it, and that the goal would be to accommodate larger acts from places like Seattle, as well as provide space to local performance groups.

“The next step is to get the initial concept refined, and we’re going to be applying for a grant for an architect’s initial concept,” Stowell said.

The Silverdale Community Center site is one of three being considered by Kitsap Regional Library for a new branch location.

The other two possibilities are a Port of Silverdale property in Old Town Silverdale on Lowell Street and a Silverdale United Methodist Church parcel along Ridgetop Boulevard near Silverdale Way. Jeff Brody, KRL director of community relations, said the library board expects to finalize its selection in June.

The library is estimated to be between 8,000 and 10,000 square feet (the current branch is 4,950 square feet.)

“Even at the small end of that range, the

Library Foundation hosts author event with mystery writer National best-selling mystery author J.A. Jance will be featured at a March 4 event in the Author! Author! series hosted by the Kitsap Regional Library Foundation.

Jance, whose mysteries include the series featuring Seattle detective J.P. Beaumont and Arizona Sheriff Joanna Brady, will be the special guest at the event, which will be held at 6:30 p.m. at Rice Fergus Miller Architecture and Planning in Bremerton.

The KRL Foundation’s Author!

Author! series has local authors leading a conversation with visiting authors. The programs create an intimate atmosphere in which the audience can “eavesdrop” on a building would be quite a bit larger than the existing Silverdale library and it would be designed to make much more efficient use of its space. … We would build larger if the fundraising allowed it, or if a partner wanted us to add space for a specific purpose,” Brody said.

The library has a letter of intent with the county stating it would build a library on the property currently occupied by the sheriff’s substation or the community center, should one of those locations become available.

conversation between the writers, which generally touches on the specific work of the guest authors as well as the craft of writing and the publishing industry.

The host author for the March 4 event will be Seattle mystery writer Bernadette Pajer, who has penned the Professor Bradshaw mysteries and is a member of the Seattle 7 Writers group.

In addition to the conversation, there are wine and hors d’oeuvres for guests, and comfortable seating at unique Kitsap County venues. Books by the authors are featured are for sale at the events, which end with a book signing opportunity.

General seating tickets are $50 and available at krlf5.brownpapertickets.com.

All profits go to benefit the Kitsap Regional Library. Contact Sheila Perreault, sperreault@krl.org, for more information.

KRL will hold a town hall meeting at 7 p.m. on March 20 in conjunction with Central Kitsap Community Council to provide an update on the project plans.

Stowell said that a five-year timeline for the performing arts center is realistic, with construction taking as long as 18 months.

“We are really enthused about this idea,” he said. “It’s good from a business standpoint because communities that have built performing arts centers typically have seen economic development as a result.”

Gig Harbor group to raise funds for feasibility study on arts center

26 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

By Rodika Tollefson After a year of waiting, the Gig Harbor Arts Center Alliance expects to receive its official 501(c)3 status from the Internal Revenue Service this spring — and with that,

it can start fundraising for a feasibility study.

Organizers have been working on the idea of a regional arts center for a couple of years, but need the feasibility study to determine operating costs, revenue potential and

economic impact of the proposed campus.

The study would also help determine whether the proposed center is the right size and fit for the community.

“There have been a lot of arts centers

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that closed doors because their model wasn’t set up to accommodate bad economic times,” said alliance president Anne Knapp, a Gig Harbor artist and former president of Peninsula Art League.

“We want to make sure the center would be sustainable and more regional (in reach.)”

The current vision is for an 88,000square-foot campus in Gig Harbor North.

The proposed center would include conference space, multiple studios for different activities, classrooms, a commercial kitchen, a community theater, a performance hall with an orchestra pit, a black box theater, a ballroom and an amphitheater, among other amenities. The design of the center was the result of collaboration among several arts and community groups as well as four charrette sessions with an architect.

Cost was estimated more than a year ago at $30 million, and one financing method the group has discussed is the creation of a public facilities district, an independent municipal corporation under state law.

“We dream big. I think having a range of building sizes and meeting rooms would be valuable to our community, but the feasibility study may find that not to be the case,” Knapp said.

The study is estimated to cost $50,000 Study, page 27

Bainbridge architects design Habitat for Humanity’s second Passive House

Social justice presentation will discuss Supreme Court decisions and corporations

Wenzlau Architects and Robert Moore Architect, both of Bainbridge Island, have partnered with Habitat for Humanity to design and construct Habitat’s second Passive House on the West Coast. This highly energy-efficient home, recently completed for Tacoma/Pierce County Habitat for Humanity, was designed and built to meet the rigorous standards of the Passive House Institute U.S. Habitat has incorporated many energysaving features into its projects in recent years in an effort to provide homes affordable for their residents to live in. Passive houses take energy-saving features even further, resulting in homes with monthly operating costs reduced by as much as 90 percent compared with homes built to current energy code standards.

A Passive House is Photo courtesy Robert Moore designed to take on energy This home built for Tacoma/Pierce County Habitat Humanity conservation from a was designed by Bainbridge Island architects Charlie Wenzlau “passive” perspective; that and Robert Moore to meet Passive House energy-efficiency is, it simply recaptures as standards.) much of the cheapest available energy it can (from the sun and heat given off by appliances and even the building occupants) and holds onto it for as long as possible. Due to the care taken in the design and construction of a Passive House, a typical mechanical system is no longer needed. In fact, winter heating needs actually can be met with the wattage of a standard hair dryer.

Also, the indoor air quality is kept fresh and comfortable with the use of whole-house heat recovery ventilation. Some of the features used by Wenzlau and Moore include highperformance triple-pane windows; double wall construction with a highly insulated building “envelope”; air-tight detailing; and Energy Star appliances. The addition of a small photovoltaic system would easily take the house to “net zero” energy usage. The architects provided their services pro bono to Habitat.

From the outside it’s difficult to tell that this house is any different from others on the street. But the Passive House construction techniques will help a new Habitat family financially by reducing their yearly heating costs while also reducing their carbon footprint, and without sacrificing comfort. As Habitat stated, “this is an opportunity to re-define affordable housing.”

A presentation on “The Supreme Court, Corporations and You” will be offered March 18 in Bremerton. A series of U.S. Supreme Court decisions have established corporations as persons and equated money with speech. Featured speakers will be U.S. Rep. Derek Kilmer (D-Wash.), Fran Korten, publisher of YES! Magazine, Kitsap Sun editor David Nelson and attorney Michael Stowell.

They will discuss the impacts of these decisions and the grassroots response. Each speakers will talk for 10 to 15 minutes, and they will dialogue among themselves and field questions from the floor.

The presentation will be from 7-9 p.m. in the Bremer Student Center at Olympic College, 1600 Chester Ave. in Bremerton.

from page 26 and Knapp said the board had several consultants in mind. “We want to go to someone very qualified and experienced,” she said.

If everything goes as planned, the alliance will kickstart its fundraising with an event in June in conjunction with Gig Harbor’s annual Maritime Gig festival. The plan includes a gala and auction of oars created by artists like Knapp, and her goal is to have 50.

“People in the community have helped already but we need more to get involved,” Knapp said.

She said the feasibility study would be comprehensive and would take about six months to complete.

“The center has huge potential,” Knapp said. “The more we talk with other organizations, the more possibilities we find.”

For more information about the project, go to www.gigharborartscenter.org.

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Port Orchard to hold open house on 2016 Comp Plan update The City of Port Orchard will formally kick off its 2016 Comprehensive Plan update process with a public open house on March 8. The event will be held from from 9:30 a.m. until noon in Council Chambers at City Hall, 216 Prospect St. The open house is being held for the purpose of gathering public input on key issues and challenges facing the city, as well as for expressing opinions on what opportunities there are for improvement of the city overall.

The city has partnered with a University of Washington class of masters degree students who will be there to facilitate the visioning process.

This is an opportunity for citizens to participate in the process itself, and it will assist the city in planning for its future. For more information, contact Community Development Director Nick Bond at 360876-4407 or nbond@cityofportorchard.us.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 27

STUDY

This program is presented by the Social Justice Committee of the Kitsap Unitarian Universalist Fellowship. Representatives from WAmend.org and other social justice organizations will be on hand to share what they are doing and answer your questions about how to get involved.

For more information, contact Jo Walter, littlesproutsps@comcast.net or (360) 5516944; or Linda Driver, lindaadriver@yahoo.com or (360) 204-6898.

28 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Conclude job interviews without giving applicants unrealistic expectations

By Julie Tappero Last week, a job candidate who’d just completed an interview told us, “I’m so excited; they offered me the job!” when, sadly, it turned out she actually hadn’t gotten the job.

What went wrong?

The interviewer didn’t know how to gracefully end the interview, and the unintended result was a total miscue to the candidate. This is an agonizing situation for both job candidates and employers that should be avoided at all costs!

Applicants coming to job interviews are excited and eager. Could this be the next step in their career, the best job they’ve ever had, or the opportunity that finally gets them off unemployment? They badly want to hear the magic words “you’re hired.”

The interviewer can feel that pressure, and not want to be the cause of disappointment. If an interviewer is too delicate or unclear when they end the interview, the job seeker can come away from it with the entirely wrong idea.

So how do you send a job seeker on their way gracefully without miscommunication?

Plan ahead: Before the interview starts, know how it will end. If you have a plan, you won’t end up with a big misstep.

Tell the candidate what to expect: Most applicants just want to know what to expect. How will I know whether or not I’ve got the job? Will you call me or send me an email? Will it be days, weeks, or months before I hear? Wrap up the interview by telling the candidate what to expect. Tell them what the next steps are, where you are in your hiring process, and when and how they can expect to hear from you.

Don’t give tours: Don’t give the candidate a tour of your facility, show them where their office would be, or introduce them to everyone in the facility. This gives them the impression that they will soon be returning to work there with these nice new co-workers they’ve just met.

Don’t provide too much feedback: When job seekers prepare for interviewing, they are often advised to ask certain

questions at the end of the interview, such as, “Will I be moving forward in the interview process?” or “After meeting me, do you feel I have what you’re looking for?”

Your specific answers to these questions can end up giving the candidate the wrong impression. Don’t get put on the spot.

Answer in a general manner, letting the candidate know that it was great to meet them, that you wouldn’t have brought them in unless they had the qualifications you were looking for, and that at this point in the process, you aren’t able to compare one candidate to another.

Don’t let your enthusiasm get the better of you: Sometimes an interview just goes really well and we want the candidate to know that. It could be that we just really clicked during the interview. It might be that our personalities mesh well, or the candidate is just very likable, or impressive in person, or has great interviewing skills.

If you succumb to the temptation to give them instant positive feedback, what the candidate hears is “I’m probably going to hire you.”

It’s always a good practice to give yourself the opportunity to reflect on the candidate after the interview ends, review their qualifications again, conduct reference checks and any other necessary verifications, and compare all of your candidates before moving forward. Resist the temptation to tell a candidate that you’ve already fallen in love.

And don’t forget, if a job applicant comes away from an interview with you mistakenly thinking that you’ve made them a job offer, and they quit their current job because of this, you could end up on the hook for their unemployment. It won’t necessarily matter that the job offer that fell through didn’t exist in the first place, so be careful!

Just recently a client ended the job interview by telling the candidate how perfect they were for the job. He sent her off with tons of reading to do over the weekend in preparation to start. But over the weekend he had a change of heart and decided to interview more candidates before making a decision. This did not end well. The candidate was entitled to be paid for her training time over the weekend, and was so disheartened by the turn of events

that when the formal job offer came several days later, she was no longer excited to work for that company.

In these hard times, going through the job hunting process can be discouraging and arduous.

As employers, we have something really special to give to someone: employment!

And as good, decent people, we also want to make this process less stressful by being considerate of job candidates’ feelings, even if we have no intention of hiring them.

It’s important to remember that it’s not always kindest to send people on their way thinking they may have just landed a job, simply to spare their feelings. Better to set a realistic expectation for everyone, and then

to call later on and make someone’s day with a job offer.

• 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. Consult with your legal counsel when addressing legal concerns related to human resource issues and legal contracts.

Kitsap Great Give on workshop agenda for area development officers The Kitsap Development Officers Group meeting on March 4 will feature a Major Giving Workshop. Chris Davenport will be showcasing a major giving video from a seasoned professional to lead a discussion about major gifts. Additionally, there will have professionals on hand to answer questions and add real life examples.

Kitsap Community Foundation also will update the group on plans for The Kitsap Great Give, a new philanthropic campaign being organized for this year. The deadline for nonprofits to register for The Kitsap Great Give is March 15.

Any nonprofit located in or serving the greater Kitsap area is eligible to participate in an online day of giving that will be held on May 6. Goals of the event are to have thousands of donors donate over $500,000 to hundreds of local nonprofits on that day. For more information, please visit www.kitsapgreatgive.org or call 360-698-6043.

The March 4 meeting will be from noon to 1:30 p.m. at the Poulsbo Library, 700 NE Lincoln Road in Poulsbo. All nonprofits are welcome to attend the free workshop. RSVP to kitsapdevelopment@gmail.com.

Bainbridge Island designer receives industry group’s award for second straight year A Kitchen That Works LLC of Bainbridge Island has been awarded “Best of Houzz for Customer Satisfaction” by Houzz, the leading platform for home remodeling and design, for the second year in a row. A Kitchen That Works, owned by Molly McCabe, is a full-service residential design-build firm specializing in kitchen and bath remodeling.

The Best Of Houzz award is given in two categories: Customer Satisfaction and Design.

Customer Satisfaction honors are determined by a variety of factors, including the number and quality of client reviews a professional received in 2013. Design award winners’ work was the most popular among the more than 16 million monthly users on Houzz.

With Houzz, homeowners can identify not only the top-rated professionals like A Kitchen That Works, but also those whose work matches their own aspirations for their home. Homeowners can also evaluate professionals by contacting them directly on the Houzz (www.houzz.com) platform, asking questions about their work and reviewing their responses to questions from others in the online community.

The showroom for A Kitchen That Works is at 9856 NE Torvanger Road on Bainbridge Island. Follow the business on Houzz at http://www.houzz.com/pro/mmccabe/__public.

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Tech Forecast 2014: Bright with increasing clouds, but expect changes

By Charles Keating Recent events have prompted an update on the state of IT and future directions. I’ve written previously about the advantages of cloud services, BYOD (Bring Your Own Device) trends, and virtualization.

For business owners, the buzzwords don’t matter. They care about purpose, cost and reliability. Then they weigh pros and cons, view other features, and finally – want to know when to implement. As trusted advisors, clients expect us to delve into details and explore the edge of what’s possible, and recommend best-fit and bestpractice solutions when they are ready.

Their focus simplifies the decision-making process, but the ‘when’ piece can still be murky. A convergence of business and technology trends has made 2014 a critical year for making transitions happen.

The mantra “if it ain’t broke, don’t fix it,” combined with delayed investments in a down economy translated into many users holding onto XP desktops and Windows 2003 servers well past their prime.

Microsoft extended the life support for these systems, but on April 8 security updates on XP will end, and Windows Server 2003 security updates will end next July. Some decry this as profit-driven to force upgrades, but XP (on average) is six times more vulnerable to hacking than Windows 7. Securing obsolete systems or waiting for breakdowns isn’t sound longterm strategy. Investing in technology improves staff productivity — the most valuable asset — so this push is in the right direction. Tablets and other devices usage is on the rise, but won’t replace the functionality of desktops or laptops, most of which are Windows 7 or 8.1 for those visioning ahead.

Increased user expectations are also

driving change. A few years ago, clients could go offline for a day, whereas now even a few hours causes angst. In the past, the default mailbox size was 200 megabytes, sufficient for text and html messages with occasional attachments. Now mailboxes are 20 times larger, users frequently handle large file attachments and are expected to respond quickly. As recently as 2007, few had usable mobile email and internet access. Now everyone does and they are “always on.” Some still have regular business hours and work in one location, but numerous others work on the go and need access to their data anywhere, anytime.

Cloud services also have greatly improved in the last few years to meet these expectations. Due to virtualization and economies of scale, the cost of delivering hosted services (like email and file storage) has dropped significantly while capabilities surged. Since hosted services compete directly, they must be efficient, and savings are passed on to end users in price competition. Outages are publicized and costly, so extra measures are taken to ensure reliability and security. HIPAA and other standards compliance are in place.

The belief that hosted services are more costly than owning your own server in the long run does not factor the efficiencies of scale or competition driving this environment. The local server may still be king in some applications for performance, but a hybrid with cloud-based services adds functionality, reliability and cost savings.

Many have questioned Microsoft’s decision to discontinue their popular Small Business Server line in 2012. The succession plan was to use lower-cost servers paired with cloud services. Users were concerned this would result in higher

In advance of the first-quarter 2014 rollout of a new solar energy microinverter by APS, the manufacturer’s YC1000-3 microinverter was recognized by Solar Power World magazine on its Top 100 Solar Products of 2013. The YC1000-3 is the world's first threephase, four-panel microinverter for large-scale commercial solar installations.

The new product is a single unit that connects four solar modules (up to 310W STC each) to provide from 208V to 480V three-phase grid voltage. It maximizes power generation for each module to boost efficiency by up to 20 percent. The performance of each module can be individually monitored from a home computer.

Find out more about the YC1000-3 by contacting APS at Paul Barlock sales@apsamerica.com, or download the product spec sheets on the company’s website.

APS America also announced the promotion of Paul Barlock to Senior Vice President.

He will manage the company's sales team and development of strategic partnerships.

Barlock has been a senior sales and marketing executive in a variety of power electronics firms, ranging from startups to large multinational corporations. His work experience has been in custom power supply design, UPS, telecom power, cable TV backup power, and most recently in renewable energy. Barlock, a Marine veteran, holds an undergraduate degree in physics from the University of Pittsburgh and an MBA from Boston College.

"We're moving the market into areas that have not been penetrated," Barlock said of the APS line of innovative solar microinverter products. "Our innovative technology is driving the market to a different, larger microinverter model, and at a lower cost."

progressed smoothly, no doubt due to automation and virtualization. In the last month, we completed more Office 365 migrations, including our internal web and email services, with even more planned for March.

Clients love the improved access. Some are driven by the need for upgrades. One unexpected convert encountered a server problem. Despite getting them back online within a few hours, the conversation turned to their need for higher availability. Even though we were not looking to update their systems, the redundancy offered by cloud services and mobile networks means their customer and supplier interactions could continue — even if the local server or power failed. Once they heard the cost, $5 per user per month, it was a go.

This, in a nutshell, is why these changes are happening now.

• Charles Keating is president of Keating Consulting Service (www.kcsco.com), an IT consulting firm serving global clients since 1983.

He is also a partner in K2 Strategic Solutions (www.k2strategic.com) and Professional Options (www.professionaloptions.org), and current president and co-founding member of West Sound Technology Association (www.westsoundtechnology.org).

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March 2014 Kitsap Peninsula Business Journal • KPBJ.com 29

APS announces product recognition and promotion of executive to Sr. VP

total costs. However, cloud service costs have been dropping faster than expected and capabilities increasing, so the hybrid scenario has demonstrated both good value and flexibility since the hosted services are maintained and stay current. This is such a significant advantage that even larger organizations are leveraging hosted services.

A new Microsoft Office 365 Small Business user receives mailboxes capable of holding 50 GB, includings virus protection and spam filtering, and protected redundant file-sharing storage all for $5 a month … less than the valued-added cost of anti-virus and spam filtering just years ago. There are other service choices, but it helps that Office 365 is maintained by Microsoft, developers of the software.

Windows Server 2012 R2 offers improved storage and local backup capabilities and integration with the cloud services, making for a compelling upgrade.

In our own recent experiences, last year we began deploying Office 365 for clients.

We have been using multiple hosted services for many years, and recently consolidated a number of domain, web and email hosting services to correct issues caused by the acquisitions. Once the decision was made to consolidate, it all

Kilmer announces STEM competition for local high school students U.S. Rep. Derek Kilmer (D-Wash.) has invited high school students from Washington’s 6th Congressional District to participate in the first Congressional Science, Technology, Engineering and Math (STEM) Academic Competition. This new “House STEM App Challenge” is a nationwide competition designed to engage students’ creativity and encourage their participation in STEM education fields.

Students will compete within their congressional district by creating and exhibiting a software application or “app” for mobile, tablet or computer devices on a platform of their choice. Students have until April 30 to submit their apps. For additional details on how to participate, see below or visit http://kilmer.house.gov/house-appcontest.

Throughout the completion period, participating students will be provided opportunities to engage with various STEM educational partners in their community to mentor and assist them with their app development. Students entering the competition must provide a YouTube video demo explaining their app and what they learned through this competition process.

The submitted apps will be judged by a panel of individuals within the academic, software and entrepreneurial fields. The winning student’s app in each participating congressional district will be featured on the U.S. House of Representatives website

(www.House.gov), as well as on display in a U.S. Capitol exhibit.

“As a dad of two little girls who will one day be entering a workforce that needs skilled workers, and as a guy with a background in economic development, I know the increasing role technology is playing in the economy,” Kilmer Rep. Derek said. “We should always Kilmer look for more opportunities to engage young people about the value of a STEM education. I'm looking forward to seeing the innovative apps created by students in our region."

Hadi Partovi, co-founder and CEO of Code.org, said, “Increased education in STEM and computer science is essential to the future of our country. Every student, not just the ones who want to pursue a career in technology, will benefit from a broad understanding of the science and especially the computer technology that powers the world around us."

West Sound Technology Association president Charles Keating said, “Programming and technology skills are as important as math, reading and writing for brain function lateralization and a 21st-century economy. Everything f rom cake decorating to building houses will increasingly leverage technology, and

students will need to be prepared for jobs that are quickly evolving. Code.org’s ‘Hour of Code’ initiative sparked tremendous interest, and events like the app contest will continue to build on momentum while engaging students.”

Karen Burns, a teacher-librarian at Gig Harbor High School, said, “I am a firm believer in students getting the opportunity to use technology to create products. Technology is a wonderful tool for students in many areas of the school curriculum, but it is the higher order thinking skills that students can apply to projects such as this House App Contest that bring learning through technology to fruition.”

HOW TO PARTICIPATE • The contest is open to high school students who reside in Washington’s 6th Congressional District.

• Participants may compete individually or in groups of up to 4 students.

• For groups of 2 students at least 1 must reside in the Washington’s 6th Congressional District.

• For groups of 3-4 students at least 2 must reside in the Washington’s 6th Congressional District.

• Students can verify that they live in the district by going to https://www.pbcelections.org/precinct finder.aspx or https://www.browardsoe.org/precinctf

inder.aspx and selecting My Districts To submit an entry: • Create an account on http://challengepost.com/ and register for the House Student App Contest.

• Create an App Demonstration Video of no more than 2 minutes that demonstrates the scope and quality of the app.

• Create a Developer Video of no more than 1 minute in which the participant describes how they created the app and what they learned.

• Upload both videos to YouTube or VIMEO and submit the links through http://challengepost.com/.

• Submit an entry form through http://challengepost.com/.

• Entries will be judged on: • Quality of the idea (including creativity and originality).

• Implementation of the idea (including user experience and design).

• Demonstrated excellence of coding and programming skills.

• The winning app will be featured on the US House of Representatives website www.house.gov and Representative Derek Kilmer’s website http://kilmer.house.gov/ and will also be on display in a US Capitol exhibit.

For more information, contact Rohan in Kilmer’s office at (360) 373-9725.

Thinking of Building or Remodeling?

30 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

NEW HOMES • REMODELS • COMMERCIAL The Home Builders Association of Kitsap County will be debuting their new consumer-focused magazine Build & Remodel on the Kitsap Peninsula, at the Spring Home & Garden Expo.

If you’re considering a project, large or small, be certain to pick this magazine. The features are ontrend, the photography stunning.

For more information, call the Home Builders Association of Kitsap County at 360-479-5778.

The Official Publication of the Home Builders Association of Kitsap County

Minimum wage increase stalls in Legislature

By Rodika Tollefson With the dust barely settled after a controversial minimum wage of $15 an hour was approved by voters in SeaTac, the idea has spread to Seattle and Olympia. While some Seattle public officials are floating a similar increase for their city, state legislators and the governor are trying to get support for a significant increase statewide.

House Bill 2672 proposed to increase the minimum wage to $12 an hour over three years, while Gov. Jay Inslee in his state of the state address suggested a hike between $1.50 and $2.50 an hour. The state’s current minimum wage is $9.32, which is the highest in the country and more than $2 above the federal minimum wage.

With employee costs accounting for 60 percent to 70 percent of overhead for many businesses, the proposal has met stiff opposition. The restaurant and retail industries would be especially affected, as two of the industries that tend to pay lower wages.

Amy Igloi Creed, owner of Amy’s on the Bay in Port Orchard, was one of several restaurateurs who met with Inslee about his proposal. Using revenue numbers from her past three years, Creed created two simple scenarios showing the impact of a $10.82 wage and an $11.82 wage — without factoring in the raises she’d have to give more senior staff for more equitable pay and without accounting for other increases

like employment taxes.

Her calculations showed that a $10.82 minimum wage would have eaten up 55 percent of profits in 2011, while the $11.82 wage would have cut into 92 percent of profits. “We would have been out of business in 2011,” said Creed. “Restaurants are the largest employer in the state and to have them go out of business means more people out of work and on food stamps.”

Warren Zimmerman, executive director of the Gig Harbor Peninsula Chamber of Commerce, said almost all the chamber members who talked about the proposal were opposed to it. “The position our businesses take is based on personal experience,” he said. “When minimum wage goes up, especially in large increments, they cut back on employees or they don’t add any new people.”

He points to economic studies that have used large businesses to show no impact on consumer prices and no other negative consequences. “The fallacy of those studies is that they don’t look at the impact on small businesses and there’s a huge difference in impact,” he said.

Zimmerman said he’s also not convinced that a higher minimum wage closes the gap between the rich and the poor, which is a frequently used argument by supporters. “Because we already have the highest minimum wage in the country, we should have the narrowest gap between

the rich and the poor but Washington ranks 16th,” he said.

HB-2672, sponsored by Democrats including Legislative District 23 Rep. Sherry Appleton of Poulsbo, made it out of one committee but stalled in Appropriations.

Fellow Democrat Larry Seaquist of Gig Harbor, a member of the appropriations committe, said he supports the idea in principle but not the way it’s being proposed.

“Obviously we have a large swath of citizens who work at very low pay and we’ve had that problem in our society steadily getting worse. But our economy is very fragile,” he said. “I think while the idea is good, we would have to apply it very cautiously in very small steps. Right now I’m not ready to support the big steps.”

The bill would have likely had an uphill battle in the Republican-controlled Senate.

Legislative District 26 Sen. Jan Angel (RPort Orchard) said the impacts would be devastating to businesses, especially since employers would have to raise wages up the chain and all the way to supervisors to make the pay equitable.

“How will employers cover that? They have to increase cost of products or services,” said Angel, who used to own several hair salons. “You have seniors on fixed income and now they have these inflated costs for services and products. I think it will erode our economy and hurt small and medium businesses at a time they are trying to get

back up from their knees.”

Washington state is not the only one looking at the minimum wage issue, and several have enacted laws already. The topic is also gaining momentum in Congress, where the Fair Minimum Wage Act was recently endorsed by 75 leading economists. Political analysts, however, are skeptical that the bill will pass.

U.S. Rep. Derek Kilmer (D-Wash.), who’s from Gig Harbor and has a background working in economic development, signed up as co-sponsor of the bill earlier this year, joining nearly 200 others.

Kilmer was not available for an interview but submitted a statement saying the increase would serve to stimulate the economy.

“In my decade of working in economic development I often heard from employers who said that low pay led to challenges with employee retention and less money in consumers’ pockets to spend in local businesses. I also know from nonpartisan research that increasing the minimum wage not only encourages people to enter or reenter the workforce, it also has a positive impact on economic growth and helps lift hundreds of thousands of families out of poverty,” his statement said. “That’s why I’ve co-sponsored a bill to increase the national minimum wage and why I’m hopeful that Congress will take up efforts like this to grow the middle class and get this economy moving again.”

Marijuana startups encountering lots of obstacles marijuana enterprise.

The investors who formed Seattle Inceptive Group and applied for a producer license in Kitsap County had found a landlord willing to lease them a warehouse, with an option to buy the building.

Unfortunately for that group, the landlord's willingness was trumped by the Port of Bremerton, which owns the Olympic View Industrial Park where the building sits. Port commissioners recently passed a ban on all marijuana businesses on port-owned property.

"There's no apparent reason," said Jeff Way of Port Orchard, who represented Seattle Inceptive Group and made an unsuccessful appeal to get the commissioners to change their minds.

"Everybody falls back on federal law, and the feds have already said they're not going to do anything, and there will be no action taken against landowners.

"This is what we were trying to explain to the commissioners."

The city of Poulsbo recently extended for six months its temporary zoning —

similar to other cities — that restricts marijuana businesses to light industrial areas. And those sites, under state I-502 rules, are off-limits if they are within 1,000 feet of a school, daycare center, park or transit center. A couple entrepreneurs at the February hearing told the City Council that under the light industrial zoning restriction, the only option for siting a business is a small parcel of undeveloped land wedged between State Route 3 and Viking Avenue at the city's north end.

State Rep. Sherry Appleton, a Poulsbo Democrat, is co-sponsor of a bill (HB 2322) introduced in the 2014 legislative session that would prevent cities and counties from essentially zoning statelicensed marijuana businesses out of their jurisdictions.

Another bill goes even farther; under HB 2638, the state would pre-empt the authority of local governments to pass ordinances regulating legal marijuana businesses.

A third bill takes a different approach by offering an incentive to allow such state-

licensed businesses — cities and counties would receive 30 percent of the taxes collected from marijuana retailers in their jurisdictions.

None of those pending bills are any help to businesses working to get set up now, as the first state licenses will be issued soon.

“As far as unincorporated Kitsap County goes, they have done a pretty good job zoning marijuana business, if their goal is to make sure none appear,” the Land of Lizards owner said in an email exchange with the Kitsap Peninsula Business Journal.

The owner asked not to be identified even though applicants’ names are listed on their state business registration.

The owner, a former Port Orchard resident who’s been involved in the largely unregulated medical marijuana industry in Washington for several years, said the extremely limited zoning, plus the unwillingness of private property owners and districts such as the Port of Bremerton to rent space to marijuana businesses, is a Obstacles, page 32

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 31

By Tim Kelly, Editor Voters made recreational marijuana legal in Washington state, but local zoning laws and other obstacles are making it hard for start-up businesses in the potentially lucrative new industry.

A business called Land of Lizards is among dozens of Kitsap County applicants for state licenses to grow and/or process marijuana that would be sold to licensed retail outlets. The application lists a business address on Lumsden Road in the Port Orchard Industrial Park.

That area just west of State Route 16 meets siting standards set by the state Liquor Control Board, which created rules for implementation of I-502, the marijuana legalization initiative approved in a statewide vote in 2012. The industrial park also is one of the areas open for I-502 businesses under zoning approved by the Port Orchard City Council.

Seems like a match for what the business owner wants to set up, but the building owner will not lease the 2,400-square-foot space to Land of Lizards or any other

Legislative dealings that could impact businesses

By Rodika Tollefson The 2014 state legislative session ends March 13 and lawmakers are running out of time to pass bills from the opposite house.

Here’s a look at a few of the discussed issues that have a potential impact on businesses: • House Bill 1313 would require employers with five or more employees to provide a minimum number of sick leave days (five, seven or nine, depending on workforce size.) The bill passed in the House and at press time was scheduled for a hearing Feb. 26 in the Senate Committee on Commerce and Labor. Washington Policy Center, which opposes the bill,

estimates that the mandate will cost employers in the state $442 million.

A similar bill, HB-2238, would have required employers with 24 or more employees to provide up to three weeks of paid vacations to employees working 20 or more hours a week. The bill died in committee. Both HB-1313 and HB-2238 were co-sponsored by Rep. Sherry Appleton (D-Poulsbo), who represents the 23rd Legislative District.

• Senate Bill 6495, co-sponsored by Sen. Jan Angel (R-Port Orchard, Dist. 26), would have provided a temporary training wage for teenagers — 85 percent of the

state’s minimum wage for workers between 16 and 19 years old, expanding a law that exists for 14- and 15-year-olds. The bill made it out of the Commerce & Labor Committee but died in Rules. “It was an excellent bill but didn’t go anywhere,” Angel said. “I don’t know what they would have against a teen training wage.”

• Senate Bill 6045, also co-sponsored by Angel, would require more transparency and predictability in the state permitting process. It was passed in the Senate 43-3 and was scheduled for a House committee hearing on Feb. 25. The House version is co-sponsored by District 26 Rep. Larry

Seaquist (D-Gig Harbor).

The Association of Washington Business is among the bill’s supporters.

Gary Chandler, AWB vice president of government affairs, said regulatory reform is a major issue in Washington, especially since businesses pay slightly more than half of all state and local taxes.

“If we’re going to have a high taxed state, then you have to give us relief somewhere else,” he said. “Regulatory hurdles are a big drawback in this state. … We’re not asking for relief of permits or less regulation, we’re asking for better timelines and certainty in getting permits.”

32 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Hospital Assoc. asks court to invalidate new Certificate of Need rules PRNewswire-USNewswire The Washington State Hospital Association has filed a petition in Thurston County Superior Court asking the court to invalidate recently adopted Certificate of Need rules. The hospital association's lawsuit asserts that the new rules do not have a basis in the Certificate of Need law, as all agency rules are required to have.

"State agencies can't redefine what the law means after 20 years of interpreting the law the same way," said WSHA president and CEO Scott Bond. "We know the new rules go too far because the Department of Health has consistently said the law doesn't apply to mergers or affiliations. Reversing that position now is arbitrary and is beyond the authority granted to the department by the Certificate of Need law."

For the last 20 years, the state Department of Health has reviewed the sale,

purchase or lease of a hospital according to the plain language of the term "sale, purchase or lease." Once the review is completed, the state awards a Certificate of Need— essentially, a permit to add new services.

Throughout that time, the department has said that it doesn't have the authority to review other management changes, such as mergers and affiliations.

The department changed its rul es as of Jan. 23, and will now review any kind of "change of control" in "any part" of a hospital.

The rule change means that even relatively small business decisions would have to go through an extensive review— even if they don't affect patient care or the amount of health services in an area. For example, a hospital's decision to outsource billing services or share a Human Resources department with another hospital may be subject to Certificate of

Need review. Other types of transactions that may be subject to the review include bringing in a specialty oncology provider to manage cancer care, or pediatric specialists to manage a Neonatal Intensive Care Unit.

The Certificate of Need program is essentially a permitting process. Add the fact that each application requires a $40,000 filing fee and typically takes months or years to complete, and the process becomes unmanageable for hospitals.

"Hospitals are working to improve services and be more efficient, and some hospitals are forming partnerships to improve the care they provide. For some hospitals, if they can't meet those challenges with partnerships, cutting services is often the next alternative,” Bond said. “Expanding review for Certificate of Need does nothing to increase or preserve health services, and

the far more likely result will be a hospital closing or reducing services."

The association (www.wsha.org), which represents 98 hospitals in the state, argues in its lawsuit that it was beyond the department's authority to rewrite Certificate of Need law, and was arbitrary and capricious of the state to change the long-standing interpretation and application of that law — in other words, the department is not following the law.

Only the legislature can change the law.

The lawsuit does not challenge the licensing requirement changes related to the posting of hospital policies, and WSHA is working with members to meet this requirement.

OBSTACLES

in a similar situation. Way said the warehouse they had lined up — having paid $7,500 for a lease option through April 1 — was the only location suited for the marijuana-growing operation they planned to start.

“At this point we’re not really sure what we’re going do,” he said.

He said one of their investors is a financial manager with connections to a group investing in development of a large growing operation at a former sawmill site leased from the Port of Wilapa Harbor in its industrial park.

That publicly funded port district is subject to the same federal regulations as the Port of Bremerton, Way noted. But the port in the small town of Raymond in Pacific County is willing to let marijuana production be part of its economic development plans, and the new venture could create dozens of much-needed jobs there.

The Seattle Inceptive Group was invited to look at that area, Way said, “so we may be just jumping ship from Kitsap County

altogether.”

Applicants wanting to open retail marijuana outlets also face challenges in finding approved sites, while waiting to find out if they’ll even get a license. Since there are limits for retail outlets — Kitsap County could have up to 10 — there will be a lottery to assign licenses to qualified applicants in a city or county.

Under recently modified state rules, applicants have 30 days after they’re granted a license to find a business location that complies with I-502 siting regulations.

A Port Orchard woman named Kathy, who asked that her last name not be used, hopes to open a local shop called Mari Jane’s selling marijuana-infused edibles, liquids and other products. She has an informal agreement with another retail applicant, Tim Sypowicz of Gig Harbor, to possibly open a business as partners if either of them gets a license.

Sypowicz, who used to live in Port Orchard, said they’ve found a couple possible locations in the vicinity of

Sedgwick Road and Bethel Road in one of the only areas where city zoning would allow a retail marijuana outlet. However, he said that could change because there’s some nearby land that was left to the city in the property owner’s will for a possible park. If the city develops a park on the land, the 1,000-foot buffer requirement would eliminate possible sites in the area for marijuana shops.

“The locations we’re looking at, it would wipe them out,” he said.

Kathy, who’s 29 and said she’s never smoked marijuana, said she has found some landlords willing to lease space for her business, but it’s complicated for I-502 applicants by uncertainty about whether they’ll get a license and how long it will be until they find out.

“Securing a location and then waiting six months or however long for the lottery, and then finally signing a lease on it, that’s hard for landowners who are committing to lease

from page 31 double roadblock for entrepreneurs.

“I have been growing marijuana for the medical marijuana dispensaries for a few years now, and naturally would like to move that over to a legitimate I-502 production facility,” he said. “I was totally unable to find a willing landlord anywhere in Kitsap County.”

He had another potential location in Kelso, where he most recently has operated a collective garden for medical marijuana dispensaries, but that also did not work out.

Like many applicants, he has applied for licenses in multiple jurisdictions, and is hoping one will come through.

“I now have yet another warehouse on Puget Island, in Wahkiakum County” (along the Columbia River in southwestern Washington), he said. “It is much smaller than I had wanted but at this point I am forced to take whatever I can get.”

The Seattle Inceptive Group finds itself

• Source: Washington State Hospital Association

Obstacles, page 32

State exploring alternative to gas tax for funding roads

By Tim Kelly, Editor Driving vehicles that get better gas mileage — whether all-electric cars, hybrids, or regular sedans, pickups and SUVs manufactured to meet higher fuelefficiency standards — seems obviously beneficial.

However, the positive formula of people buying less gas to drive the same number of miles has a consequence for the public roads system, which is funded and maintained by the per-gallon tax motorists pay at the gas pump. Rising fuel efficiency means declining gas tax revenue, which is why a change seems likely, possibly as soon as next year, in how Washington funds its road system.

A study completed by the Washington State Transportation Commission (WSTC) in 2013 determined that it would be feasible in the near future to replace the gas tax with a road usage charge, also known as a vehicle-mile tax. The summary of that report, submitted to Gov. Jay Inslee and the Legislature in January, explained that “As cars become more fuel-efficient and alternative fuel vehicles become more common, the long-term sustainability of the gas tax as a primary revenue source for transportation will steadily decline.”

While lawmakers wrangle in Olympia over a proposed increase in the current gas tax to fund a transportation package, the Transportation Commission’s 23-member steering committee is studying various options for assessing a road usage charge, and how and when a transition to such a funding system could be implemented.

WSTC commissioner Tom Cowan, chair of the steering committee. All drivers, even those who bypass the gas pumps and “fuel” their cars at electric charging stations, would pay the same road tax rate based on how many miles they drive.

Options for assessing a road usage charge Tim Kelly photo include charging a flat Replacing the state gas tax with a road usage charge would mean all fee to drive a vehicle an drivers would pay the same rate per number of miles driven, unlimited number of regardless of what type of vehicle they drive. miles for a period of time (a month or a year); a The report to the Legislature contained charge of perhaps 1.2 cents per mile these key findings: measured by odometer readings; and an • The road usage charge systems we automated distance charge, which would be evaluated will cost more to collect than the measured by in-vehicle technology that can gas tax, but should generate greater and distinguish between in-state and out-of-state more stable net revenue over 25 years; travel with periodic billing.

• Providing drivers choices as to how they The steering committee’s next step will pay a road usage charge will help improve be setting up a pilot program. public acceptance and mitigate privacy “We would like to come up with what that concerns; would look like in this next year,” Cowan • Gas tax increases can raise more net said, “so that if the Legislature thinks it’s a revenue in the short term than the road good idea to do a pilot project, hopefully usage charges we evaluated, but over the we’d be ready to do that in late 2015.” long term will continue to erode in value, Neil Strege of Washington Roundtable , thus requiring frequent increases; and who represents the business community on • A road usage charge system with the steering committee, said there is choice helps ensure everyone pays more of “general acknowledgment among groups their fair share for using the roads, that work on transportation issues that the regardless of fuel source or miles per gallon. gas tax has some structural problems.”

“A key difference with the road usage He said the steering committee’s work charge is it levels the playing field,” said has determined that switching to a road

OBSTACLES

default, the bank could wind up with an I502 tenant and that’s what they don't want.”

That apprehension may ease since the Justice Department issued guidance in February about how banks can work with state-licensed marijuana businesses, but startups still may struggle to find available locations.

Further complicating matters, the Liquor Control Board — concerned about a possible oversupply of marijuana for a limited number of retail outlets — recently changed the rules to allow only one producer license per business instead of three. The board also will limit licensed growers to using only 70 percent of their allowed production space, which is a maximum of 30,000 square feet for an individual business.

“It seems to me with all the bans and moratoriums in place,” the Land of Lizards owner said, “only the very well-funded startups who can afford to pick a piece of empty land and build something to suit their needs are going to have much success.”

One possibility that’s surfaced elsewhere is having several growers or processors share a facility. A Seattle private equity firm created to invest in the legal cannabis industry plans to open several large warehouses around the state where growers, processors, testing labs and other businesses could lease space.

L&I holds local workshop to help new employers The state Department of Labor & Industries is offering an informative workshop to help new employers. The next workshop will be held March 27 in Bremerton, from 9-11:30 a.m. at the L&I office at 500 Pacific Ave., Ste. 400. Online registration is encouraged to allow for planning, and registration is available by calling 1-800-574-2829 or online at www.Workshops.lni.wa.gov. Make sure to reference course number 3-78-0079.

This free workshop is essential for all business owners and managers who don't yet have a full understanding of employer rights and responsibilities relative to the Department of Labor and Industries, or of the services and resources L&I provides. Participants will learn about workers compensation, quarterly reporting, critical claims management strategies, workplace safety and health requirements, wage and hour laws, and contractor registration rules. This workshop also covers payroll, overtime, meal and break requirements, keeping records and importance of paying for workers' compensation and the importance to your bottom line of managing claims. Other topics include workplace safety and health requirements and contractor registration rules.

Labor & Industries is a state agency dedicated to keeping Washington safe and working.

For more information, please call Keith Johnson at 253-596-3834 or visit www.workshops.lni.wa.gov.

State to offer webinar on business taxes Business Examiner Laws are normally written to place the responsibility for compliance on a business being taxed, putting the onus for learning how to comply on the taxpayer.

For the first time, the State Department of Revenue is offering an online business outreach session through a webinar planned for March 12. Its focus is new and small business owners who are learning what their responsibilities are as related to state taxes.

“We’ve offered in-person workshops for a number of years,” said agency director Carol K. Nelson, “and offering online webinars will make it easier for small businesses to fit a workshop into their busy schedules.”

Advance registration is required for the 10 a.m. session on March 12. Go to www.dor.wa.gov/webinar to sign up and the deadline to register is Friday, Feb. 28.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 33

from page 32 to us,” she said.

Unlike Colorado, where legal marijuana retail shops opened Jan. 1 and saw high demand right away, Washington’s preparations have taken much longer since both states passed legalization laws in November 2012.

“I don’t feel like we’re going to have a store open anywhere (in Washington) until 2015, honestly,” Kathy said.

From the perspective of commercial property owners, there are practical reasons for not wanting tenants involved in legal marijuana ventures.

“It’s been a crazy few months for commercial real estate agents,” said Garet Gartin, the agent for the building that Land of Lizards and other I-502 applicants wanted to lease. He said the landlord didn’t want to create an uncomfortable situation for his other tenants that share the building.

A marijuana-growing business “is much better suited for a single-tenant building,” Gartin said.

The biggest issue, though, is with banks, he said.

“For landlords who have recently refinanced or taken money out on their property, banks have been whispering in their ears about I-502,” he said. “If they

usage charge is feasible, “and there are a number of different options and technologies that make that idea feasible.”

Although resistance is likely to the concept of the state tracking people’s driving, Strege pointed out that some insurance companies already use telemetry devices installed on vehicles to monitor their operation and to reward safe driving.

However a road usage charge is designed and whenever it’s ready, a lot of public education will be required to get drivers to understand and trust a new, more complicated system.

“It’s never going happen unless the citizens of Washington state will accept it,” Cowan said.

He said the Legislature directed his steering committee to develop a road usage charge that would replace the current gas tax, not be an additional tax. However, the Legislature would make the final decision.

The price of a gallon of gas currently includes a state tax of 37.5 cents. Assuming the price of gas would drop by that amount if the gas tax is eliminated, drivers would have to calculate their savings at the pump and compare it with how much they would be charged for road usage under a new system.

“I think biggest challenge is just change itself,” Strege said. “Right now the gas tax is so easy (to collect); it’s not itemized on your receipt, and people barely notice they’re paying it.”

Cowan said even with the problems and issues of switching to a road usage charge, “I think this is going to be the best way.”

2014 Jaguar F-Type: The F is for Fantastic

By Bruce Caldwell It took five decades for Jaguar to market a successor to the iconic ’60s E-Type, but the all-new 2014 Jaguar F-Type is a noble heir. The new F-Type is a serious performance car that’s also gorgeous. The 2014 Jaguar F-Type has all the benefits of a half-century of technological innovations packed into an evocative body. The 2014 Jaguar F-Type has it all: performance, style, comfort, luxury, and safety.

Walkaround: The 2014 Jaguar F-Type is stunning. The designers did a fantastic job conceiving and executing a shape that is sleek and sexy from all angles. The long nose and short deck pay tribute to the revered Jaguar E-Type, which is easily one of the finest sports car shapes ever penned.

The new F-Type has echoes of the past with a fully modern interpretation. The F-Type is one of those cars you can’t park and walk away from. You’re compelled to turn and admire it.

Differences between the three F-Type variants are subtle with increasing tire/wheel sizes (18-, 19-, and 20-inch) being a chief difference, but the quickest way to distinguish between V-6 and V-8 models is the extra pair of exhaust tips on the V-8 models.

Interior: The cockpit has a distinct racer/aeronautical flavor with the emphasis being on the driver, not the passenger.

The multiadjustable seats are form fitting and very comfortable. They hold and support you like performance seats should.

There is little room for extraneous items. Driving is the F-Type’s purpose, not cruising between latte stands. The sound system, HVAC system, and various info systems are all on par for a vehicle with MSRP prices between $69,000 and $92,000 (options can push prices over six figures).

Interior quality is excellent, as is overall fit and finish of body panels. The interior design is handsome, not gimmicky. The soft top is well insulated for warmth and quiet.

Under The Hood: There are three engine choices, all of them supercharged. The base engine is a 3.0-liter V-6 rated at 340 horsepower and 332 lb-ft of torque. The

Want to see even MORE Automotive Reviews?

34 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

www.autoreviewers.com Your local resource for in-depth professional reviews of new cars and trucks, plus breaking industry news, tech features, fun facts, and other stuff you never knew about cars.

Written by nationally published automotive journalists Lary Coppola and Bruce Caldwell — both Charter Members and past officers of the Northwest Automotive Press Association — they bring over a halfcentury of driving and review writing experience directly to you.

autoreviewers.com — Your Automotive News Source

first optional engine is in the F-Type S, which boosts the 3.0-liter V-6 to 380 horsepower and 339 lb-ft of torque. The FType V-8 S has a 5.0-liter aluminum V-8 that produces a prodigious 495 horsepower with 460 lb-ft of torque.

Jaguar lists 0-60 times of 5.1 seconds for the base V-6, 4.2 seconds for the V-6 S, and 4.2 seconds for the V-8. Some enthusiast magazines have reported sub-four second 0-60 times and quarter mile times less than twelve seconds. This cat is quick.

The V-8 reminded us of a highly tuned Corvette small-block (we mean this in the most complimentary way) after it attended finishing school. Depending on your driving style the engine can either be mildly restrained or ready to rip up asphalt. The two V-6 engines are excellent, but the V-8 is so much fun (and not too much more expensive than the V-6 S model) that it’s our first choice by a large margin. Also, in terms of future resale/collectability we predict the V-8 F-Type will be the model to have.

An eight-speed automatic that’s so good you won’t complain about the lack of a manual transmission backs all three engines. Jaguar calls the transmission “Quickshift” and the term is accurate.

There is a console-mounted SportShift selector and steering wheel paddle shifters.

The transmission has a very sophisticated adaptive shift program with 25 different strategies depending on driving style and road conditions.

The engine and exhaust sounds are a symphony to any gearhead’s ears. Both S models have Active Exhaust. The system has electronically controlled bypass valves that open under hard acceleration. If you share our adolescent hot rodder tendencies

you’ll want to activate the Active Exhaust frequently, but you can just as easily cruise in relative peace.

Behind The Wheel: This is where the thrill ride begins. It’s open-air fun for two people and very little else. People who can afford a Jaguar F-Type have other vehicles for mundane transportation chores.

The F-Type is loaded with state-of-theart technologies that maximize handling and braking. The car is so smart that it will make you a far better driver than you’d be in a lesser vehicle. We drove V-6 and V-8 models at The Ridge Motorsports Park. A professional driver tutored us first, but we couldn’t come close to matching his lap times. Our nerve limiter stopped way before the Jaguar’s limits.

As exciting as the racetrack experience was (it impressively demonstrated how thoroughly engineered the F-Type is) the real fun was blasting through the twisty roads around Mount Rainier. We also spent time in the mountains of Oregon on another occasion. The F-Types shines in both venues.

Speaking of shining — when the sun shines the power canvas top can be folded on the move at speeds up to 30 mph. The top retracts in a mere 12 seconds.

Whines: A lack of trunk space is to be expected in a convertible sports car, but a little more room (7.1 cubic feet is not suited for people prone to frequent wardrobe changes) would make extended road trips more enjoyable.

Bottom Line: The 2014 Jaguar F-Type is a fantastic sports car worthy of the company’s legendary letter series predecessors. The F-Type isn’t practical, but if it fits your financial future it’s fun that shouldn’t be missed.

New 2014 Kia Soul: Still hip, just improved smartphone, Bluetooth, Sirius/XM satellite radio with Nav Traffic available, USB and iPod ports. The audio system also delivers on style with dash-top speakers and multi-color speaker lights that pulse to your music.

Sure, they’re gimmicky, but they add character you won’t find in a Honda CR-V or the aforementioned competitors.

Our loaded Exclaim test vehicle piled on options besides the premium seats, like a heated, tilt and telescoping steering wheel, with controls for the premium Infinity audio system, panoramic power sunroof, push-button engine start/stop, automatic climate control, backup camera, and more.

The Navigation system’s 8-inch touchscreen features a split-screen arrangement for Navigation and audio if you want to view it that way, with easy to use controls. There’s also a smaller screen available without Nav. Cargo room is a surprising 24.2 cubic feet, expandable via 60/40 split/fold-down rear seats. We were able to load a mediumsized dog crate inside without folding the rear seats down, and still close the hatch.

Under The Hood: The base Soul is powered by a 1.6-liter direct-injection fourcylinder, with 130 horses and 118 poundfeet of torque. The mid-level Plus and topof-the-line Exclaim both feature the more potent 2.0-Liter, 164-horse, directinjection four-banger that puts out 151 pound-feet of torque. Both powerplants can be married to a six-speed manual, or automatic depending on trim. Our test Exclaim had the automatic. EPA mileage ratings are 23/City and 31/Highway for a combined 26. We experienced slightly higher mileage overall.

Behind The Wheel: Matching cool looks with a fun-to-drive experience doesn’t always happen. The Soul tends to drive more like a small SUV than a compact hatchback. However, thanks to a nearly 29percent stiffer chassis, expandable foam body sealing and a reworked suspension, the 2014 Kia Soul has a much cozier relationship with the road than the previous version.

On a trip to Portland and back, we found reduced noise levels from the 2013 Soul, while the suspension smoothed out all but the worst road imperfections. While the Soul corners with noticeably increased confidence over the old model, no matter which “Flex Steer” resistance setting we chose, steering was predictable, but lacked driver feedback.

Acceleration is adequate when merging into freeway traffic, or passing, but even with the more powerful 2.0-liter engine, it lacks the gutsy response found in its quicker competitors.

Whines: The eight-inch touch screen features the ability to scroll through content like a smartphone, by using a finger.

However, when trying to randomly navigate a playlist, it kept reverting to the alphabetical top of the song list after each tune. Also, when using the Nav system to locate a certain upscale restaurant in downtown Portland, it brought up driving directions for the same name eatery in three Puget Soundarea locations, but not where I actually was.

Bottom Line: There’s a lot to like about the 2014 Kia Soul. Pricing starts at a very reasonable $15,495. Our fully loaded Soul Exclaim stickered at $26,195. Compared to its competitors, the Soul is the bargain of the funky compact segment — and none offer anything close to Kia’s 100,000-mile, 10-year warranty. Whether you’re looking at a compact or small SUV, it’s worth checking out.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 35

By Lary Coppola When the Kia Soul debuted in 2009, it joined the Scion xB and Nissan Cube in that unique market niche defined by the cool factor, funky styling, low prices, and youthful spirit. A mere five years later, we’re watching xB and Cube follow the Honda Element into oblivion. Meanwhile, the Kia Soul continues to enjoy strong sales momentum.

With an eye towards holding on to the hipsters — which seemingly include as many Boomers as Millennials — Kia introduced a new Soul for the 2014 model year that’s been heavily redesigned, with updated styling inside and out, — plus a host of new features.

A refined exterior, coupled with upgraded interior and an impressively expanded menu of standard and optional equipment, have positioned the Soul to give the Mini Countryman, Fiat 500L and Nissan Juke some serious competition. The Kia’s competitive price, revised styling and radically improved interior make it a star in that cute, cheap, compact-box market segment.

The Soul successfully straddles the line between being a compact hatchback and compact SUV. It’s sized and priced like a hatchback, but like an SUV, it can haul larger items. It has a lot more style and character than the competition — except for the Juke — which has a funk factor all its own.

Walkaround: The 2014 Soul has totally nailed that ultra cute 5-door box-on-wheels design. From most angles the new Soul looks a lot like the old Soul, which is OK — people obviously liked the original. Kia designers kept what buyers liked, just stylizing it.

There’s an added inch to the wheelbase and the stance was widened by almost an inch. Those subtle changes give it a bit more interior room since overall height remains the same. A wider rear hatch opening makes loading and unloading cargo a bit easier, and overall, the Soul appears a bit less top heavy than before.

The new Soul is offered in a variety of attractive colors, although our test vehicle was a decidedly distasteful color called Latte Brown. The top-line Exclaim (!) trim is distinguished by body-color bumper accents and 18-inch wheels, while 16- and 17-inchers come on the base and Plus (+) trims respectively.

Interior: The new Soul sports a surprisingly plush, interior for the price, with more passenger room and features than you might expect. The cabin offers higher quality materials than the previous version, soft-touch surfaces — and heated and ventilated leather seats are now available, as are heated rear seats. You also get lots of upscale quality you wouldn’t expect from a Kia Soul, not to mention lots of goodies either optional or just not available on many other vehicles.

The base Soul features standard power windows, door locks, mirrors, cruise control, and A/C as well as Kia’s UVO system which interacts with your

Publisher

We can learn from the Skagit River bridge replacement

Lary Coppola Editor Tim Kelly Advertising Sales Dee Coppola Pre-Press Operations Steve Horn Webmaster/IT Greg Piper Graphic Design Kris Lively Office Administration Jennifer Christine Web Host PCS Web Hosting LLC Contributing Writers Rodika Tollefson Don Brunell Dan Weedin Julie Tappero Jason Parker Press Releases

36 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Email to pressreleases@KPBJ.com The Kitsap Peninsula Business Journal is a special interest publication dedicated exclusively to providing news, information and opinions to the business communities of the Kitsap and Key Peninsulas, and North Mason County. It is published monthly by Wet Apple Media. Copyright, 2014, with all rights reserved. Postage is paid at Tacoma, WA. The Kitsap Peninsula Business Journal is read by more than 26,000 business, professional, political and military leaders in Kitsap, Pierce, and Mason counties. Additional copies are available for $1.50 each. Annual subscriptions are available for $25.

Reproduction or use of any editorial or graphic content contained herein in any manner whatsoever without the expressed written consent of the Publisher is strictly prohibited. The Kitsap Peninsula Business Journal is proudly composed using Apple Macintosh® computers and printed by The Kitsap Sun, Bremerton, WA. Views expressed herein are strictly the opinions of the authors and do not necessarily reflect those of the advertisers or ownership of The Kitsap Peninsula Business Journal.

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Member Kitsap Economic Development Alliance Kitsap Visitors and Convention Bureau Homebuilders Association of Kitsap County Bainbridge Island Chamber of Commerce North Mason Chamber of Commerce Poulsbo Chamber of Commerce Silverdale Chamber of Commerce

By Don C. Brunell The news these days is filled with stories about Big Bertha, the stalled Seattle waterfront drilling machine, and the cracks in the pontoons of the new SR 520 floating bridge across Lake Washington.

You might wonder if Washington’s Department of Transportation (WashDOT) is doing anything right.

They are.

For example, the replacement of the collapsed I-5 bridge across the Skagit River between Mount Vernon and Burlington is an example of how WashDOT engineers and private contractors can move quickly to design and complete a major transportation project with minimal traffic disruption.

Here’s what happened.

On May 23, 2013, just after the evening rush hour, a semi-truck carrying an oversized load of oil drilling equipment slammed into the supports of the 58-year old bridge. About a third of the four-lane bridge plunged into the river. Two vehicles fell into the water, but the three people in those cars were rescued by boaters. Miraculously no one was seriously injured.

State transportation officials went to work almost immediately.

Traffic engineers worked through the night on detour routes through the streets of Burlington and Mount Vernon for the 71,000 vehicles that use the bridge daily. Within 24 hours, a contractor was hired under an emergency contract to remove the collapsed span, and began working with WSDOT engineers to install a temporary span to get the interstate back open. The temporary span was up and operating by June 19.

On June 18, the state awarded a $6.87 million contract to Max J. Kuney Construction of Spokane, one of our state’s oldest and most respected contractors, to design and build a permanent replacement span. The design was completed on July 9 and construction began three days later. The replacement bridge was built alongside the temporary span without interrupting traffic, and moved into place during an overnight closure on Sept. 14–15.

The Skagit River bridge replacement is an example of how things can get done quickly and effectively. Yes, this was an emergency and we cannot expect that breakneck pace on a regular basis. But surely there is something we can learn from this extraordinarily successful project – something lawmakers and elected officials can use to reduce the protracted delays that cost motorists and taxpayers billions.

Traditionally, major transportation projects in Washington seem like a bureaucratic blood sport. They spark months or years of criticism, accusations, public hearings and debate from all sides. We call that “input.” On occasion, people who don’t get their way file lawsuits, causing further delays.

That’s followed by months or years more of

design and permit review. We call that “process.”

There must be a better way. Of course, public input is important, but there comes a time when we have to stop talking and get moving. Endless “process” needlessly runs up the costs of these projects, and hinders transportation improvements that bring environmental and economic benefits.

Lawmakers, state transportation officials and private contractors should come together to analyze what made the replacement of the Skagit Ridge bridge such a resounding success. Then they should identify ways to translate that success to everyday transportation projects around the state – whether by streamlining permits, utilizing the faster “design and build” construction process, or expediting regulatory reviews.

The Skagit River bridge project was a stunning success. Let’s learn from it. Let’s make it possible to have successes like that every day of the week.

• Don Brunell is a business analyst, writer and columnist. He recently retired as president of the Association of Washington Business, and now lives in Vancouver. He can be contacted at TheBrunells@msn.com.

Colorado trumps Washington on recreational cannabis, for now

By Chris Walsh Which state will serve as a model for other markets when it comes to crafting a recreational cannabis program: Colorado or Washington?

Colorado appears to be the clear choice at this point from a business perspective, with its recreational marijuana market humming along nicely.

The industry is already generating tens of millions of dollars in sales, and

entrepreneurs are reporting enviable profits.

Washington state’s program, on the other hand, is mired in controversy and has experienced several setbacks.

The latest issue for the state emerged recently when the agency overseeing the program decided to reduce the number of cultivation licenses a business can apply Trumps, page 37

Pause, reflect, give thanks, power forward marketing manager; Mary Jo Juarez, procurement consultant; and Susan Veach, financial administrator and PTAC instructor. Over the past 12 months KEDA has directly advised and assisted more than 150 business clients in securing over $25 million in new business and impacting over 250 jobs in our community.

Our 36-member board of directors (18 business leaders and 18 elected officials) ensures our alliance has the resources we need to develop new opportunities for our clients. This allows us to connect existing and new businesses to resources and relationships that help them grow and prosper in Kitsap County. After two years of outstanding leadership, board chair Julie Tappero, president of West Sound Workforce, will pass the leadership baton to

TRUMPS

making process, helping to ease the transition and avoid controversy.

Additionally, it left a good chunk of the industry in the hands of the free market, allowing an unlimited number of retail stores and cultivation sites to participate and letting residents cultivate their own cannabis.

This structure allowed officials to develop rules and regulations on the industry quickly and efficiently. Colorado worked aggressively to get the first retail businesses licensed, leading to an ontime, relatively smooth roll-out of retail sales.

Of course, first is not always best. And there are some key differences in the markets.

The fact that Colorado already had a robust regulatory framework covering medical marijuana businesses certainly helped it transition to recreational sales.

Washington never developed rules for dispensaries, and the medical marijuana industry as it exists now in the state is technically illegal. Washington therefore faced additional challenges from the start, and the process likely would have been more controversial than in Colorado anyway.

Additionally, each state has different concerns and a different idea of where they see the industry going.

We also have no idea how this will play out over time. Washington’s model might emerge as the national blueprint once it clears these initial hurdles, while problems certainly could crop up in Colorado (particularly if unrestrained growth invites scrutiny from the feds).

But the early results show some hiccups in Washington’s initial approach where businesses are concerned, and its move to eliminate – rather than embrace a nd restructure – the medical marijuana industry is a crucial mistake in the eyes of many.

For these reasons, other states considering recreational marijuana legalization could take more pages from Colorado’s playbook.

• Chris Walsh is editor of Marijuana Business Daily.

from page 36 for and also slash the amount each operation can grow. This is a major change at a relatively late stage of the rulemaking process, and it’s creating huge problems for entrepreneurs who have already invested time and money in their business plans and applications.

“People are apoplectic,” Washington attorney Ryan Agnew said. “Many people had already formed partnerships and made the capital outlays necessary to grow at (the higher production cap).”

Additionally, sales tax estimates released in February by a state agency projected that actual recreational marijuana sales might not begin until June 2015 – a full year late r than anticipated at this point. While that’s a worst-case scenario, the fact that it’s even being floated as a possibility is telling.

Although Washington and Colorado both legalized recreational marijuana in November of 2012, the two states have taken very different paths since then.

Washington put strict limits on cultivation and the number of retail stores, and the original demand estimates it used to s et those rules now appear woefully off base. It also has flip-flopped on several key aspects of the program, and its ban on home growing in the recreational market could exacerbate supply issues.

Perhaps most significantly, it’s moving forward with plans to more or less abandon medical marijuana rather than create an entirely separate market.

“The MMJ community was cut out of the drafting of (the law) and th us missed an opportunity to share their knowledge of the market and work in rules that might benefit existing MMJ businesses,” Agnew said, adding that there are also issues with location restrictions, high tax levels and large operating and startup costs.

Colorado, by comparison, created a clear division between the medical and recreational industries so the two could co-exist. The state also gave current M MJ stakeholders a huge role in the rule-

Steve Politakis, CEO of Kitsap Bank.

Stepping into the role of vice chair will be Ben Anderson, CEO of Art Anderson & Associates, and board member Bob Guyt, principal at Rice Fergus Miller, will join the officer ranks as treasurer.

These outstanding volunteer leaders carry on a long legacy of Kitsap community influencers who have guided our alliance and helped to create immeasurable economic opportunities for thousands of proprietors and business enterprises for more than three decades.

This past year has seen the Kitsap Economic Development Alliance emerge as an even stronger player in the Greater Seattle Region, leading the way in the military and maritime sectors, and securing new opportunities for local businesses in aerospace, advanced manufacturing and technology. 2013 also saw an increase in regional collaboration — from the Central Puget Sound Economic Development District, to the multi-chamber Kitsap Business Forum, to the Greater Kingston Economic Development Council.

Since its debut at last year’s annual meeting, the Kitsap Connected multimedia marketing campaign has garnered wide acclaim, and made a measurable difference in the way we work with the broad community to tell and sell Kitsap’s economic development story. At this year’s annual meeting we will expand upon the

Digital Ambassador Program that was introduced at our economic forecast conference in January. For more information about the program and how you can become involved, please contact Kathy Cocus at cocus@kitsapeda.org — or plan to attend our alliance’s annual meeting on March 20. Registration details are found at www.kitsapeda.org.

Finally, as we march into the coming year, our leadership team is focused on accelerating the rate at which we engage and serve our business clients. Our strategic work plan calls for a substantial increase in our direct outreach and recruitment activities with a targeted focus on advanced manufacturing, in both maritime and aerospace, as well as the defense and technology sectors. And, we look forward to working closely with Kitsap County and Kitsap’s cities as they embark on comprehensive updates of their respective Comprehensive Plans — important public policy tools for economic development.

If your business is facing new challenges and opportunities — give us a call. We would be honored to provide you with an array of confidential consulting services at no cost — services and advice that can help you and your team make 2014 a year to remember.

On Kitsap!

• John Powers is executive director of the Kitsap Economic Development Alliance.

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 37

By John Powers, Kitsap Economic Development Alliance As we approach our alliance’s 33rd annual meeting on March 20, I want to take a moment to slow down, count our many blessings, and prepare to advance our work at an everincreasing pace in pursuit of new opportunities under new board leadership in this u p c o m i n g organizational year.

This past year was fast-paced and very productive; for that I want to thank our terrific team: Kathy Cocus, business development director; Theresa Mangrum,

Time to draw a line in the sand …

It’s no secret to any non-Kool-Aiddrinking person actually paying attention to the world around them, that the Obama administration’s corrupt practices have led to a systematic dismantling of the protections guaranteed by the U.S. Constitution. Now that I have your attention, of course I realize that sounds blatantly partisan — like an alarmist Fox News rant, with a cup of Tea Party flavoring mixed in. However, if you’ve read George Orwell’s classic novel 1984, you know it isn’t.

The novel, originally published in 1949, is set in the superstate of Oceania, in a world perpetually at war, and where highly intrusive government surveillance of its citizens is omnipresent. Can you say NSA? Public mind control is dictated by a political system known as “Big Brother.” It enforces the government's invented language, “Newspeak” — or in our case, political correctness — both of which basically take away the right of free speech.

In 1984, it’s all controlled by a privileged class of governmental elitists that prosecute all independent thinking and individualism as “thought crimes.” Sound familiar?

Nowhere is the scary comparison between 1984 and what is currently happening in America more evident than the recent announcement that the Federal Communications Commission will be sending people to “investigate” television and radio newsrooms across America. Under the guise of something called the “Multi-Market Study of Critical Information Needs,” the agency plans to send “researchers” to grill reporters, editors and station owners about

the news philosophy of their stations, and openly demand to know exactly who decides which stories are covered.

Quite frankly, that’s none of the government’s damn business! That’s what the First Amendment is all about.

How long before the administration i n v a d e s LARY COPPOLA newspaper city rooms — which The Last Word have become primarily Internet-based? How long before they use the government’s control over Internet access to regulate independent, webbased news content? And finally, overrun that last bastion of independent thought, bloggers?

MSNBC and the rest of the Lamestream Media — except for Fox — has become little more than the press office of the Obama administration. So they’ve not resisted this heavy-handed government initiative to control what news we get to see and hear. Why not?

However, the Radio Television Digital News Association has stood up to fight back, condemning the administration’s actions as "ill-conceived," and having the potential to "… chill every journalist and every station which prides itself on journalistic independence."

American University professor John Watson noted, "Whenever I hear of the government going into a newsroom to do something other than deliver coffee, I become frightened. Because the government should not, as a general rule, be any part of journalism."

And former FCC commissioner Robert

McDowell questioned, "How much government coercion might there be with all of this? Is the government trying to ultimately dictate speech and dictate how journalists are supposed to do their jobs?"

This certainly appears to be the first step in that direction.

The very last thing we need is the government involved in deciding news content. This Big Brother-ish effort by the FCC is little more than a Trojan horse meant to integrate federal officials into the newsroom — where they don’t belong.

And before all you Kool-Aid drinkers get your shorts in a wad, ask yourselves, what kind of outrage would you be expressing if this kind of government intrusion was proposed under the Bush administration?

Stay tuned. * * * While on the subject of radio news and independent thought, it appears the demise of liberal talk radio has begun across America.

In New York City, WWRL will change formats and become a Spanish-language music and talk station, tossing Ed Schultz, Thom Hartmann, Randi Rhodes and Alan Colmes off the air. In Los Angeles, KTLK will dump Rhodes, Stephanie Miller, Bill Press and David Cruz, in favor of Glenn Beck, Rush Limbaugh and Sean Hannity. In San Francisco, KNEW will leave Miller, Hartmann and Mike Malloy without a radio outlet there. These are the three most liberal cities of the nation.

According to recent Arbitron ratings, KTLK in Los Angeles was ranked #41 in the

market. WWRL in New York registered almost no pulse at all, while San Francisco’s KNEW registered just a 0.4, placing it at #31.

Radio is a business that’s all about advertising dollars and little else — not content or personalities. What you hear is dictated by how many listeners a given format attracts — not some unseen conservative corporate conspiracy to prevent liberal opinions from being voiced, as some knee-jerk liberals will undoubtedly charge. The simple fact is, significantly more people listen to conservative talk radio than leftist radio. The failure of commercial liberal talk radio means that in many major markets, the only liberal talk radio left will be taxpayer-supported NPR. * * * Finally, income inequity and the minimum wage are on people’s minds these days. I question an across-the-board raise as President Obama has proposed, and Governor Inslee’s suggestion we further increase the highest minimum wage in the nation. However, there’s a move among some of the wealthiest Americans — including Warren Buffett, Silicon Valley multimillionaire and registered Republican Ron Unz, who once ran for California governor, along with Seattle venture capitalist Nick Hanauer — to do just that.

They seemingly subscribe to Henry Ford’s philosophy — pay people more, and they’ll have money to buy what you sell, restoring the middle class, and significantly strengthening our economy. It’s a different take on Ronald Reagan’s philosophy of “A rising tide lifts all boats.” Your thoughts?

38 • Kitsap Peninsula Business Journal • KPBJ.com March 2014

Making it their mission to build a place offering help, hope It’s kind of a gypsy lifestyle, but it seems to suit a guy like Duane Atkinson.

He’s been a denizen of downtown Port Orchard since last July, though you might not have run across him unless you poked your head in to see what was going on in the building at 807 Bay St. That's where The Coffee Oasis just opened its third location in Kitsap County, and Atkinson and a few other out-of-town fellas did a lot of the work getting the café ready for its March 1 debut.

They are construction missionaries, bringing their skills to the Coffee Oasis project as members of Hard Hats for Christ, a ministry based in Kelso, Wash., just across the Columbia River from Atkinson's hometown of Rainier, Ore. "We've all been doing a little bit of everything," he said.

That's how an all-volunteer project gets built, by a whole lot of helpers lending a hand when they can.

"This Coffee Oasis belongs to the community of Port Orchard because it was built by the local people, not by contractors," said Helen Stanley, facilities coordinator for the nonprofit that works with homeless and

at-risk youth. "It was built by Rotary and Hard Hats, and some of our youth," ... and more volunteers than she could name or remember.

Some help briefly but at critical moments, like the day Stanley had a load of sheetrock in her truck parked in front of the building and it TIM KELLY started to rain.

"This biker Editor’s View guy was walking down the sidewalk, and I had sheetrock in the back of my pickup and there was nobody around to help me," she said. "And he helped me carry it inside so it wouldn't get all wet."

Café manager Jesse Westwood said individuals would show up occasionally because they saw a Facebook post about the building renovation in progress, and offer to spend part of their day helping out.

Help by happenstance is welcome, of course, and makes for nice anecdotes, but it takes a devoted core of volunteers to push a project through to completion. The Rotary

helpers and the crew from HH4C provided that.

"The Hard Hats for Christ have been fantastic," Stanley said. "They're just amazing men."

Atkinson, who spent the most time on the project and hung a lot of drywall, slept in a second-floor apartment while on the job. The host church or organization puts up the "faith-supported missionaries" who may spend weeks or months at a worksite, or the host provides a spot for helpers in the subgroup RVers for Christ to park their motorhomes or trailers. Joe Newton, who installed the service counter in the coffee house, came to Port Orchard that way.

Some HH4C members are retired and have time to travel around the country to work on projects.

But for Atkinson, roaming the country and the world — he's been to places you can't reach in an RV — as a missionary builder has long been his lifestyle.

"I work with them full-time, and I've been with Hard Hats since 1980," the mildmannered volunteer said. "I graduated from high school in 1970, and I was working in the woods and stuff, but I was interested in

ministry."

He found his calling with Hard Hats, which does not act as a contractor but provides skilled volunteers to work with the host group's own folks on construction.

Atkinson spent a couple years in South Kitsap building the Burley Bible Church in the 1980s.

He's also done extensive service in the Dominican Republic, where he took a portable brick-making machine and worked with a summer youth program building churches, camps and clinics.

"I was asked to go down for a number of summers, and I ended up going down there and living for about 10 years until the late '90s," he said.

He sees some similarities in his work there teaching kids about construction, and what Coffee Oasis does in helping young people from the streets learn work skills and deal with the challenges they face.

"It's a really unique outreach they have here," he said.

And HH4C guys like Atkinson and friends were a unique blessing for The Coffee Oasis.

Local business. Local needs.

For 35 years, we’ve been here for both.

As we celebrate our 35th year, Wet Apple Media continues to be committed to supporting local causes. Since 1979, we have been doing our part to help improve the quality of life for local residents, businesses and nonprofits.

Contributions to our community:

Humane Society Jungle Bell Run Junior League Juvenile Diabetes Research Partners Foundation Kitsap Community Foundation Kitsap Community Resources Kitsap County Association of Realtors Kitsap County Historical Society Kitsap County Medical Society Kitsap Economic Development Alliance Kitsap Peninsula Farmers Markets Kitsap Peninsula Visitors and Convention Bureau Kitsap Regional Library Kitsap Wine Festival Kiwanis Clubs Master Gardener’s Foundation Mathis Guild National Kitchen & Bath Association Olympic College Foundation Peterson Farm Fall Fair Port of Bremerton Port Orchard Log Cabin Museum Port Orchard Waterfront Art Walk Rotary Clubs School Districts SK Helpline Social Media Marketing Conference Soroptimists The Bainbridge Island Studio Tour United Way Uptown Gig Harbor Concert Series Vino Kitsap Washington CASH West Sound Art Council West Sound Technology Association WSU Kitsap Extension Services 40 Under Forty

March 2014 Kitsap Peninsula Business Journal • KPBJ.com 39

Admiral Theatre All-Chamber Business Expo American Cancer Society Amy Burnett Gallery Audubon Washington Bainbridge in Bloom Bainbridge Island Arts & Crafts Bainbridge Island Garden Club Best of West Sound Campaign Bloedel Gardens Boys & Girls Clubs Bras for a Cause Bremerton Symphony partner Bremerton YMCA Women’s Shelter Built Green Program Chambers of Commerce – Port Orchard – Bremerton – Silverdale – Bainbridge Island – North Mason – Poulsbo City of Bremerton City of Port Orchard Collective Visions Gallery Crosspoint Academy Dr Penrose Guild Envirostars Festival of Trees Fire Districts Gig Harbor Film Festival Gig Harbor Garden Tour Gig Harbor Museum Greenworks Habitat for Humanity Harbor Hounds Harrison Hospital Foundation Holly Ridge HBA of Kitsap County