Kitsap Peninsula Business Journal 9 - March 2015

March 2015 Vol. 28 No. 3

Est. 1988

An edition of the Kitsap Sun

Last Frontier A national bank’s recession failure sent local companies scrambling as foreclosures came down Page 3 Regional director’s tips for SBA loans | Page 5 Bank branches changing, but not going away | Page 6

The Kitsap Peninsula Business Journal Post Office Box 259 Bremerton, WA 98337

PRSRT STD U.S. POSTAGE PAID Kent, WA PERMIT NO. 71

2 |MARCH 2015

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Business Calendar March 3, 24 and 31 Good Morning Kitsap County Talk with a new business professional every week and network with local businesses.

Where: Hop Jack’s, Silverdale When: 7:30-9 a.m.

Info: silverdalechamber. com March 4 Contracting Coffee Hour An open forum for businesses with questions about contracting with the government on the first Wednesday of each month.

Where: KEDA, 4312 Kitsap Way #103, Bremerton When: 7:30-9 a.m.

Info: kitsapeda.org March 4, 6, 9, 12 and 18 Farm Machinery and Safety Workshop This class is open to all 4-H and FFA youth, new

and beginning farmers, and individuals of all ages and experience wanting to make their tractor experience and farm safer.

Where: Kitsap County Fairgrounds When: 6:30-8:30 p.m.

Cost: $85 Info: 360-337-7162,

Shannon.harkness@wsu. edu March 10 Kitsap Business Forum “Planes, Trains and Automobiles: We Are All in the Transportation Business” is this month’s topic. John Powers will lead a panel of local transportation experts and political influencers to discuss current plans and proposals affecting the moved of your product throughout Kitsap. Please RSVP. Where: Kitsap Conference Center, Bremerton When: 7:30-9 a.m.

Info: kitsapbusinessforum. com March 13 Brown Bag Lunch Lecture Series: John van Den Meerendonk Bainbridge Island Land Trust board member will share his knowledge of unique plant life in the Pacific Northwest.

Where: Bainbridge Waterfront Community Center, Bainbridge Island When: 11:30 a.m.-12:30 p.m.

Cost: $2 donation March 13, 14 and 15 Peninsula Home and Garden Expo Hundreds of vendors, free seminars, landscape displays and food.

Where: Kitsap Pavilion, 1200 Fairgrounds Road, Bremerton When: 2-8 p.m.

Info: kitsaphba.com March 17 Good Morning Kitsap County Meet Commissioner Ed Wolfe at this special edition of this event. RSVP for this event.

Where: Hop Jack’s, Silverdale When: 7:30-9 a.m.

Info: silverdalechamber. com March 18 Silverdale Greendrinks Wear green, bring your own glass and network with other business and local community members.

Please RSVP by March 16.

Where: Martha and Mary, 19160 Front St. NE, Poulsbo

When: 5:24-8:03 p.m.

March 19 KEDA Annual Meeting and Luncheon The meeting will be to provide members with the 2014 report of performance and financial condition, present the 2015 KEDA Priorities and Work Plan, and elect new directors to the board.

KEDA will also honor this year’s Economic Development Champions.

Please register.

Where: Kitsap Conference Center, Bremerton When: 11:30 a.m.-1 p.m.

Info: kitsapeda.org March 20 Women in Welding Workshop For women interested in learning if a career in trades is what they want. Participants will try their hand at welding, and the registration fee includes lunch. Registration deadline is March 6.

Where: Welding Shop 108, Olympic College, Bremerton When: 9 a.m.-2 p.m.

Info: 360-475-7480, careercenter@olympic.edu March 25 Edward Jones Coffee Club Donald Logan, a local Edward Jones financial advisor, will be hosting a coffee club every fourth Wednesday.

Where: 2416 NW Myhre Road Suite 102, Silverdale When: 8:15 a.m.

Info: 360-698-7408 March 31 Grant Seeking Basics Workshop An introduction and overview of the funding research process for nonprofit organizations seeking grants from private grantmakers. Topics covered include: getting ready to seek funds, the world of grantmakers, research strategies and Foundation Center tools and resources. Registration required.

Where: TBA When: 1-3:30 p.m.

Info: 360-779-2915, krl.org

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Also in this issue • Is Port Orchard market delivering on the hype? 23

MARCH 2015 | 3

introduction | david nelson

End of one era, continuing the next

T • Form, function of bank branch of the future, 6 • Coffee-hour crew shares advice on contracting, 9 • Tech columnist Charles Keating reviews net neutrality issues, 23

The Kitsap Peninsula Business Journal is published by the Kitsap Sun the first week of every month, and distributed to business addresses through Kitsap County, North Mason and Gig Harbor.

Brent Morris, Publisher brent.morris@kitsapsun.com David Nelson, Editorial Director david.nelson@kitsapsun.com Tim Kelly, Managing Editor tim.kelly@kitsapsun.com editor@kpbj.com

Mike Stevens, Marketing Director mstevens@kitsapsun.com Jeremy Judd, Digital Director jeremy.judd@kitsapsun.com For inquires to receive the Kitsap Peninsula Business Journal at your business, contact Circulation Sales Director Hugh Hirata at 360-7925247 or hugh.hirata@kitsapsun.com.

To advertise in the Kitsap Peninsula Business Journal, contact Michael Stevens at 360-7923350.

TO SUBMIT NEWS: Tim Kelly, Managing Editor tim.kelly@kitsapsun.com 360.377-3711, ext. 5359 Standard mail postage to be paid at Bremerton, WA POSTMASTER: Send address changes to Kitsap Sun, PO Box 259, Bremerton, WA 98337-1413 © 2015 Kitsap Peninsula Business Journal / Kitsap Sun ISSN 1050-3692 VOLUME 28, NO. 3

he Kitsap Peninsula Business Jourour building for decades. But it’s a shift higher quality than what our presses were nal you are holding may not immethat benefits readers because of print qualcapable of. diately look much different than ity, offers more choices to advertisers in While this move changes our workflow what you’ve seen from us terms of format and options to connect to build each month’s Business Journal, it over the past 10 months. with customers, and helps our bottom line. does not change our focus on journalism But the path it took to get Our current presses have limitations in for this community and advertising serinto the community was capacity, color and quality. Our skilled vices for local businesses. new, and that explanation pressmen work diligently to make the paThe Sun has gone through several eras illustrates a business deper look its best each day, but the machinduring our nearly 80 years of printing a cision made here that will ery is outdated and limited in some asdaily paper, in terms of our products, jourmake a difference into the pects. The opportunity is here for us to nalism, business strategy and even our future for the publication that brings you produce a more appealing paper for readphysical home in downtown Bremerton. local business news, columns, announceers and advertisers, and could foretell In fact, acquiring the Kitsap Peninsula ments and advertising.

The night of Sunday, Feb. 22 was the final press run for the 1973 Harris 1650 offset press in the basement of the Kitsap Sun office in downtown Bremerton. There was certainly an amount of nostalgia associated with that night. I sat there watching, as impressed and mystified as always when I would see the old machine rumble to print the Sun or one of our other publications. A printing press is a remarkable piece of machinery, and through the eras of print journalism the Kitsap Sun’s basement has always been a place where change occurred. So first I’ll share some history.

More than seven decades ago the paper started with a flatbed press, two typesetting machines, handme-down engravers from a Tacoma paper. During World War II a two-unit tubular press was installed that could produce up to 32 pages, and there were five MEEGAN M. REID / KITSAP SUN typesetters. In the 1960s The press at the Kitsap Sun after running for the last time in Bremerton. we upgraded to an 80-page rotary press, which could accommodate some format changes or opportunities Business Journal was a landmark change color, and expanded the composing room with the Kitsap Peninsula Business Jourin that vein, when we added a type of puband what was then known as the stereonal. That means we do lose employees lication that the company had never protyping facility. A little more than a decade from our pressroom and packaging center duced in its history. This announcement later, in 1973, the state-of-the-art Harin the process, which is never an easy deabout our production shifting is a signifris 1650 was installed and that, with some cision. Some of you in the business comicant one, and the latest step in our ongotechnological upgrades over the years, is munity know those difficult economic ing evolution as a local news company. what we’ve printed on ever since. choices all too well.

The issue you’re holding is a sign of our This edition of the Kitsap Peninsula But journalism, like many of the incontinued commitment to readers and the Business Journal was printed outside of dustries you readers work in, is a changbusiness community, and the backstory our building on Fifth Street. That’s the ing world. That’s what my history lesson on its production should serve notice of difference you don’t see — but you should above serves to illustrate. We’re acutely our intention to continue into the future know about. aware of that fact now as we expand our as a print and digital company, and do The KPBJ, along with our daily edition, digital services and readership on webso in the most efficient and effective way other weekly community newspapers, spesites and social media, and as we continue possible. Thank you for your continued cial advertising sections and quarterly dealing with a changing market for print readership and support. magazine publications, will now be printproducts. We’re simply able to offer more ed off-site at a large Puget Sound printing choices in our printed product in the cur• David Nelson is the editorial director facility, and trucked to our loading docks rent environment, whether in color, size of the Kitsap Peninsula Business Journal each evening. This shifts us away from a and format of the paper, or special adverand editor of the Kitsap Sun. Contact him unique task that’s gone on every night in tising products, and in certain terms at a at dnelson@kitsapsun.com.

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banking and finance

The fallout from Frontier Bank failure

Loans made in Kitsap County by a major bank that went belly up have been bought and sold since, leaving a mix of vacancies and potential for development.

By Tad Sooter For Kitsap Peninsula Business Journal

H

eavy machinery sits idle at a gravel quarry off Werner Road in Bremerton, waiting to be sold or scrapped.

Buyers pick their way through the once-bustling yard, hunting for equipment they can use.

On Poulsbo’s Viking Way, businesses are gradually filling the spacious buildings and sprawling parking lots once home to an auto empire. In South Kitsap, more than 600 homes are slated for construction on the site of two formerly stalled developments. And back in Bremerton, a small marina near the foot of the Warren Avenue Bridge is enjoying calmer seas under new ownership.

Scattered across the county, these properties share a common bond: a connection to failed Frontier Bank. Five years after regulators shuttered the Everett institution, the repercussions of its failure are felt seemingly everywhere in Kitsap.

Union Bank took over Frontier’s assets in April 2010. In an effort to collect on Frontier’s defaulted loans, the San Franciscobased bank forced sales of many high-profile Kitsap properties, often recouping a small fraction of the amount originally owed by borrowers, according to court documents.

Union Bank currently owns several properties in the county acquired through forced sales, including parcels home to Money Tree and Los Cabos on Wheaton Way, and the Wyatt Way Courtyards office building on Bainbridge Island.

A recent dropoff in judicial foreclosure filings suggests Union Bank may be wrapping up its interest in defaulted Frontier loans. A Union Bank representative declined to say how many commercial loans the bank had taken on in Kitsap County, and how many remained outstanding.

What is clear is Union Bank is withdrawing its physical presence from West Sound. The

bank closed seven former Frontier branches on the Kitsap and Olympic peninsulas in February, leaving only a Bainbridge Island location open.

A Union Bank spokesman told Kitsap Peninsula Business Journal the move was necessary “in order to remain competitive in a tough environment.”

The last physical reminders here of Frontier Bank are being closed by Union Bank. But other properties touched by the failed

posit Insurance Corporation review.

In 2006, before the real estate bubble burst, Frontier had accumulated the largest concentration of commercial real estate loans of any major Washington bank. Despite being considered “well capitalized” as late as March 2009, the bank’s capital growth hadn’t kept up with the growing risk associated with its real estate and development loans, according to the review.

LARRY STEAGALL

The Wyatt Way Courtyards office building on Bainbridge Island is one of numerous Kitsap County properties originally finananced by Frontier Bank, which failed in 2010, and now owned by Union Bank after foreclosure sales.

on the cover Stephen Taylor, a geologist from Lacey, takes photos of the rock piles at the Ace Paving quarry in Bremerton.

LARRY STEAGALL

Idled equipment at the Ace Paving quarry at the end of Werner Road in Bremerton,along with other assets and real estate, are for sale after the company went into receivership.

LARRY STEAGALL

bank are in various stages of changing hands, illustrating how pre-recession lending affected some ambitious plans for business growth.

RISKY REAL ESTATE

A glut of risky commercial real estate and construction loans, coupled with weak board management, toppled Frontier bank, according to a 2010 Federal De-

Frontier became one of 18 Washington banks shut down by regulators between 2009 and 2013. Its faiure cost the Deposit Insurance Fund $1.3 billion.

Frontier’s list of borrowers included some infamous names from Puget Sound’s development boom and bust. They included Michael Mastro, a Seattle real estate magnate who filed for bankruptcy in 2009. Mastro lat-

er disappeared to France where for years he successfully avoided extradition back to the United States on fraud and money laundering charges.

According to court documents, Mastro took out a $4 million loan from Frontier Bank in 2007, using condominiums in the troubled Meridian complex on Bainbridge Island as collateral.

The court appointed a receiver

for the units in 2011, at the request of Union Bank.

The eight units sold last year, netting $1.34 million for the bank.

In 2006, Frontier made large loans to subsidiaries of Bellevue-based Centurion Financial Group, LLC, which was involved in two residential developments — Bayside and Sinclair Ridge SEE FRonTIER | 7

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MARCH 2015 | 5

small business | calvin goings

Tips for getting an SBA loan

A

sk any entrepreneur what their biggest holdup to launching or growing their business is, and the answer will come quick and sure: Money.

There is little doubt that finding capital to finance a business venture is the most basic and important of all business activities. It also can be the most frustrating one if you don’t know where to look and how to navigate the process. Finding capital can be a smooth, rewarding experience provided you study diligently and plan effectively.

Putting together the necessary documents is a time-consuming process; once gathered, though, the process will go more smoothly for you. Information a lender will want to review before making a decision about a loan includes credit factors, financial needs assessment and a business checklist.

Credit FaCtors

Equity Investment — Business loan applicants must have a reasonable amount invested in their business. This ensures that, when combined with borrowed funds, the business can operate on a sound basis.

Earnings Requirements — Financial obligations are paid with cash, not “on paper” profits. When cash outflow exceeds cash inflow for an extended period of time, a business cannot continue to operate.

Working Capital — Working capital is defined as the difference between current assets and current liabilities. Current assets are the most liquid of your assets.

Collateral — Collateral is an additional form of security that can be used to assure a lender that you have a second source of loan repayment.

Resource Management

— Resource management is how you handle the dayto-day affairs of your business, including how you pay your debts, collect on debts, deliver services or products to customers and manage inventory.

FinanCial needs assessment

Whenever possible, it’s better to anticipate your needs rather than looking for money under pressure. It is harder to gain approval for a loan when your company is already in trouble, so plan ahead and secure financing well in advance of a crisis. Before you seek financial assistance, thoroughly assessing your current financial situation is critical and includes asking the following questions: • Do you need more capital or can you manage the existing cash flow?

• If you are having trouble paying your obligations on time, you may need an infusion of working capital. What is the nature of your need?

• Do you need money to start or expand your business or as a cushion against risk? How urgent is your need?

• All businesses carry risk, and the degree of risk will affect both the cost of the loan and available financing alternatives. How great are your risks?

• Needs are generally more critical during transitional stages — start-up and expansion being two of the most urgent and costly.

In what state of development is your business?

• The lender will need to know your specific intentions for the money, to assure that your business will thrive and that repayment is assured. For what purposes will the capital be used?

• Whether your industry is depressed, stable, or quickly-growing will have a distinct effect on your search for funding sources.

Businesses that prosper in tough economic times will generally receive better

funding terms. What is the state of your industry?

• Seasonal needs for funding are generally short term, and consist of smaller loans with a quicker maturation.

Loans advanced for cyclical industries, such as construction, are designed to

support a business through depressed periods — these industries are sometimes known as “feast and famine” businesses as the cash flow is often erratic and unpredictable. Is your business seasonal or cyclical?

• Effective management is an important element of business. Your lender will be looking for a strong managerial presence. How strong is your management team?

Business loan CheCklist

Before you start applying for loans, assemble some basic documentation. The following are typical items that will be required for any small business loan application: • Personal Background — Either as part of the loan application or as a separate document, gather your personal background information, including previous ad-

dresses, names used, criminal record, educational background, etc.

• Resumés — Some lenders require evidence of management or business experience, particularly for loans that are intended to be used to start a new business; polish your resumé.

• Business Plan — All loan programs require a sound business plan to be submitted with the loan sEE sBa loan | 8

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banking and finance

Branch of the future: Smaller, more high-tech, but here to stay

By Rodika Tollefson KPBJ contributor When Union Bank announced the closure of all its Kitsap Peninsula branches — and a total of 20 out of 40-plus around the state — the bank said it would continue to serve local customers through mobile and online options.

The move surprised many in the financial sector. But it seemed like a sign of the times, considering the steady growth of mobile banking.

A Federal Reserve System report last year estimated that 51 percent of U.S. smartphone owners banked online in 2013, compared with 42 percent in 2011 — and the number of smartphone owners has been growing at the same time.

Even the smaller, community-based banks are trying to keep pace with the technology, seeing mobile banking not as a perk but an option expected by customers. “(Lack of it) could be a reason someone doesn’t bank with you, so we want to make sure we stay on top of technology,” says Rhonda Morris, senior vice president of operations at Poulsbo’s Liberty Bay Bank, which plans to launch a mobile app in the next six months. “Everyone is going so fast, they don’t have time to go to the bank and make a deposit.”

The retail branch may appear to lose its relevance, especially as younger generations prefer to do their banking on the fly.

New options like online chatting, virtual tellers and mobile deposit capture are reducing the need for face-to-face human interaction — so it’s not surprising that nationwide trends show a decline in branch traffic.

But local financial institution leaders say the brick-and-mortar branch is here to stay. Perhaps rein-

LARRY STEAGALL

Branch manager KristiAnn Stecker demonstrates how the automated teller functions at the First Federal branch in Silverdale. vented, smaller, more conversational — but a physical presence all the same.

Fewer routines,

more conversations

“People are gravitating to mobile as they’re getting more comfortable but they still want physical contact,” says David Devine, senior vice president and marketing director for Tacoma-based Columbia Bank, which offers online chatting and was getting ready to launch mobile deposit capture at the end of February.

That desire for physical contact is reflected in trends in brick-and-mortar banking over decades.

A study recently released by the Federal Deposit Insurance Corp. showed that while the number of branches have contracted during certain periods such as economic or banking crises, far more bank offices were added during expansions than offices closed during contractions.

The FDIC found that “between 1970 and 2014, the total number of banking offices grew nearly twice as fast as the U.S. population, and as of 2014 the density of banking offices per capita was higher than it had been at any point prior to 1977.” While few-

er transactions are being conducted at the branches, customers still value a physical location as part of the available options, the FDIC report says.

“What we see is a shift toward the type of banking customers would like to conduct in a branch,” Devine says.

The type of business customers are conducting at the branch is less transactional and more expertise-driven, says Leah Olson, vice president of marketing at Kitsap Credit Union.

“Our members love the convenience to be able to access us at the access point of their choice — they like having that choice,” she says.

Kitsap Credit Union updated its computer core last year so new products and services can be added — services like mobile deposit capture, which will be launched later this year, and online loans, thanks to the ability to sign documents virtually.

“The idea is that more routine transactions will go through the website and the focal point (of the branch) is to engage the membership,” says Jeff Wells, Kitsap CU e-business manager. “You can’t do that electronically.

When you sit across from

someone, you get a better sense of their need.”

smaller Footprint, more eFFiciency

As remote transactions are becoming more convenient, in-person transactions are getting faster. Cash recyclers — machines that count and dispense cash, similar to those at many grocery stores — are becoming a common sight.

Kitsap Bank has cash recyclers at its two Bremerton branches, along with teller-capture technology, which reads checks electronically. This means transactions are much faster and require fewer employees, says Tony George, Kitsap Bank president and chief operating officer.

“The technology has freed up employees to provide more one-on-one help and spend more time with customers,” he says.

The new East Bremerton branch, which was built last year, has one notable difference from the old building. It is about half the size.

The changes in consumer habits along with the new technology are allowing banks to function in a much smaller footprint, more efficient spaces that cost less to operate.

One feature of Kitsap Bank’s new space won’t be unveiled for a while longer: a virtual teller. A space by the common teller area has been designed to accommodate the feature, which is expected to launch within a year or so. The virtual teller will be able to perform typical transactions such as deposits, check cashing and dispensing cash and coins.

“We designed the branch with the future in mind,”

George says. “We knew at some point the technology will be available that allows customers to do 90 percent of transactions (without human help).

the branch oF the Future

So what will the branch of the future look like? Local financial institution leaders have similar visions. Smaller footprint.

More self-serve options see BR anch | 7

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— off Anderson Hill Road just south of Gorst.

The principals of Centurion were later embroiled in lawsuits and investigated by state and federal regulators for questionable investment practices, according to reporting by the Puget Sound Business Journal.

By the time Union Bank sought receivership for the development properties in July 2011, the Centurion companies owed the bank more than $39 million in unpaid loan

MARCH 2015 | 7 principle, interest, fees and property taxes.

A receiver’s sale of the 56-acre Bayside property, slated for 294 homes, netted the bank about $1.5 million in 2012.

Union Bank saw an even smaller return on the 200-acre Sinclair Ridge property.

According to documents filed by the receiver, potential buyers felt the 800 lots originally planned for the property were too small to be feasible for most builders.

The land sold in June 2012 for $800,000, netting Union Bank $740,000.

Between the two land sales, Union Bank recouped about $2.2 million, less than 6

br a nch | f rom 6

including virtual tellers and iPads. Universal bankers.

Perhaps concierge service.

Liberty Bay Bank, among a few others, has already applied some of those concepts. It doesn’t have tellers but rather professional bankers who canhandle any transaction or question, and they can even visit a customer’s business site to sign them up for new products.

“We’re a relationship bank and most relationship customers like that hands-on style,” Morris says.

In the future, George sees spaces similar to the Apple retail stores, an open design concept with individual help desks. And more consumers embracing the self-serve options, much like they did with airline check-in.

“Because of technology, you can do a lot of things through a machine and as people get used to that, you’ll see more of them migrating,” he says.

For the Silverdale branch of First Federal, headquartered in Port Angeles, that future has arrived. The branch, which opened last June as First Federal expanded onto the Kitsap Peninsula, has an interactive teller machine and teller “pods” with universal bankers trained to handle any need. A tech bar with iPads gives customers virtual information and options, and video conferencing is available at the branch with financial advisers.

The virtual teller looks like an ordinary ATM but when a customer touches the screen, a teller from the Port Angeles main office pops up on the screen. The human teller performs the transaction on the back end, while the machine takes the deposits or dispenses dollars and coins.

“Customers enjoy it because they don’t have to be experts in the technology,” says Kelly Liske, executive vice president and chief banking officer at First Federal.

Liske says the machines have been available for some time and are popular on the East Coast and in the Midwest, but slower to be adopted on the West Coast. First Federal is the only bank currently to offer them on the Olympic Peninsula and possibly in the entire Puget Sound area (the bank has a virtual teller at a Port Angeles branch too, and more on the way at other locations).

One teller located at the central office can service three of these machines, and once more are in place, there are efficiencies because of economies of scale, Liske says.

The Silverdale branch is only 2,300 square feet because it doesn’t need as many tellers. Traditionally, branches are 2,500-4,000 square feet, according to Liske.

Despite the technology available at First Federal, Liske says the number of physical transactions hasn’t dropped dramatically. Still, she expects to see changes as consumers no longer have to leave home to pay bills or deposit checks. “I think you’ll see consolidation in the industry due to the fact that the same transactions that were offered in a branch setting can be done anywhere,” she says.

Kitsap Bank’s George says community banks will always play a local role while expanding their capabilities thanks to technology.

“We’re going to a cashless society but I don’t see banks going away from facilitating transactions,” he says. “People want to know their money is safe and invested in the local community.”

percent of money owed on the defaulted loans.

Both stalled residential developments are now moving again. Bayside plans were revived by Freestone Cos. of Fife, which began work on new homes there last year.

The sprawling Sinclair Ridge property is now owned by Northview Ridge, LLC of Suquamish, which submitted plans for a more modest, 300-home subdivision.

PaVED oVEr

While some of Frontier’s biggest borrowers were regional players, others were

well known Kitsap companies.

One was Ace Paving, a venerable Bremerton construction company that suffered a work slowdown during the recession.

Ace and its related corporations owed on several Frontier loans when the bank failed.

Union Bank tried to force the company’s properties into foreclosure in 2011, but later sold its interest in the loans to a third-party corporation called Copper Leaf, LLC. Ace Paving finally entered receivership sEE frontiEr | 8

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this winter, with Copper Leaf looking to recoup nearly $7 million in debt.

Court-appointed receiver Gary Hunter said sales of machinery and vehicles are already under way at former Ace paving yards, including those on Werner Road.

About $10 million worth of real estate will be listed, he said.

VIKInG rEVVInG UP

On Poulsbo’s Viking Way, activity is finally returning to the former lots of Coursba loa n | f rom 5

application and should include a complete set of financial statements, profit and loss statements, cash flow and a balance sheet.

• Personal Credit Report — Obtain a credit report from all three major consumer credit rating agencies before submitting a loan application to the lender. Inaccuracies and blemishes on your credit report can hurt your chances of getting a loan approved.

It’s critical to clear these up before beginning the application process.

• Business Credit Report — If you are already in business, be prepared to submit a credit report for your business. As with the personal credit report, it is important to review your business credit report before beginning the application process.

• Income Tax Returns — Most loan programs require applicants to submit personal and business income tax returns for the previous three years.

• Financial Statements — Many loan programs require owners, with more than a 20 percent stake in the business, to submit signed personal financial statements. It is a good idea to have these prepared and ready, in case a loan program for which you are applying requires these to be submitted individually.

• Bank Statements — Many loan programs require one year of personal and business bank statements.

• Collateral — Collateral requirements vary greatly. Some loan programs do not require collateral. Loans involving higher risk factors for default require substantial collater-

While some of Frontier’s biggest borrowers were regional players, others were well known Kitsap companies. tesy Auto Group, another Kitsap institution that saw the bottom fall out of its industry.

The recession hit Viking Way vehi-

al. Strong business plans and financial statements can help you avoid putting up collateral. In any case, it is a good idea to prepare a collateral document that describes cost/value of personal or business property that will be used to secure a loan.

• Legal Documents Depending on a loan’s specific requirements, your lender may require you to submit one or more legal documents. Make sure you have the following items in order, if applicable: business licenses and registrations required to conduct business; Articles of Incorporation; copies of contracts with any third parties; franchise agreements; commercial leases.

The U.S. Small Business Administration (SBA) has resources and partner organizations available to assist with this process: • SCORE www.score. org, for Kitsap Score, go to www.kitsapscore.org • SBDC www.wsbdc.org for Kitsap SBDC, go to kevin.hoult@wsbdc.org • WBC www.sba.gov/ women, for Kitsap WBC, go to www.wcwb.org Don’t let money hold up your small business plans.

Once you have completed the business loan checklist, contact one of SBA’s resource partners. After a careful review of your documents, they’ll let you know that it’s time to contact a lender. And remember, SBA is always willing to help you too. If you have further questions, contact our staff in the Seattle District Office at 206-553-7310.

• Calvin Goings is regional administrator of the Small Business Administration’s Seattle office that covers the Pacific Northwest.

cle dealers hard. Even Poulsbo RV abandoned its namesake location in 2009.

John and Terri Hern, owners of Courtesy Auto, held on. According to court documents, the Herns took out a $10.3 million loan from Frontier Bank in January 2009.

The influx of cash wasn’t enough to keep Courtesy Auto rolling.

The Herns shut down Courtesy Ford in August 2011. By November, Union Bank had successfully petitioned a court to place the Herns’ nine Viking Way parcels in receivership.

The Herns’ auto empire was sold off in

pieces in the following years, fetching roughly $5 million. One property became a Washington Tractor outlet. Another became home to an auto body shop, while Hudson Auto Center moved into Courtesy’s former used car lot.

The final, crowning property, the Courtesy Ford showroom, sold in January. The buyer was another Viking Way business family, the owners of American Building and Roofing. They’ll relocate their business up the street to the 40,000-square foot building. Hudson Auto Center will also sEE frontIEr | 9

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MARCH 2015 | 9

Kitsap ptac | mONa carlsON

Coffee Hour offers help in complex world of government contracting

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ontracting with the federal government is a vastly different, and generally more complex, experience than vendors and service providers encounter when contracting with private business organizations. Ironically, the extensive regulations and policies that can make this process so cumbersome to small businesses were actually established to benefit, guide and protect them.

Small and disadvantaged firms are afforded the widest opportunity to develop and grow through contracting opportunities with the government. All they have to do is comply with over 600 Federal Acquisition Regulations (FAR) provisions and clauses (and equally as many follow-on clauses and provisions established by each agency). It is definitely not for the faint of heart. If you are

old school and prefer a hard copy of the FAR, you will have to comb through over 2,100 pages of regulations. Thankfully, today search engines and, yes, YouTube videos make it easier to find the information that pertains to your contract more quickly.

That is assuming you know what you don’t know.

The government will identify in each solicitation or contract the applicable provisions and clauses for that action, but in a construction contract that could equate to over 200 clauses. However, in the event that the RFP (Request for Proposal) or contract omits a clause that is required by law, it is included by default and must be complied with.

To further complicate matters, those new to working with the government often find it difficult to access help and guidance. Local contracting personnel are bound by even stricter standards and must maintain the highest level of ethics and cannot risk showing

expand into the showroom, bringing the former dealership property full circle. (See story, page 34) Poulsbo City Councilman Ed Stern said the time the real estate spent tied up in legal limbo hurt commerce along Viking Way. Getting the property reopened for business will be a shot in the arm for the corridor, he said.

“The whole thing is in movement now,” Stern said. “And after years of being frozen, that’s important.”

SMOOTHER SAILING

After years of uncertainty, the former Port Washington Marina in West Bremerton is also back on the right course.

The marina, tucked inside the narrows just west of the Warren Avenue Bridge, slipped into receivership after the previous owner, Seven JS Investments, defaulted on a $1.5 million Frontier loan.

Partners in the Port Orchard Railway Marina bought the foundering marina on Thompson Drive from a receiver a year ago for $460,000. The new owners switched the name from Port Washington to Bridgeview Marina, and are gradually catching up on neglected maintenance.

“I think there was a lot of Band-Aid sort of repair work being done,” Bridgeview Marina Inc. president Jeremy McNeil said. “We want to make more permanent repairs.”

The partners hope to make the marina a more permanent success as well. Fewer than half of the 80 slips are occupied. They hope upgrades to the facilities and competitive prices will help draw boaters back.

The view of the narrows and bridge certainly doesn’t hurt.

“The beauty of it is really one of the appeals,” McNeil said.

prejudice between contractors by assisting individual contractors during the RFP process.

The burning question for both new and experienced contractors is “Where can I go for help?”

Fortunately there is help. The Washington State Procurement Technical Assistance Center receives funding from the Department of Defense, and PTACs employ counselors and staff to help bridge the gap and provide businesses with technical expertise needed to achieve success in the arena of doing business with the government. PTACs provide free and confidential business assistance and support to regional businesses in marketing and selling to federal, state and local government agencies and prime contractors. PTACs also assist agencies, departments and primes in their efforts to comply with federal and state procurement diversity goals.

Here in Kitsap, the Kitsap Economic Development Alliance

(KEDA) is your local Washington PTAC sub-center with a service area covering Kitsap, Clallam, Grays Harbor, Jefferson and Mason counties. In addition to oneon-one support and procurement training classes and seminars, KEDA recently established an open forum the first Wednesday of every month where businesses can receive help on just about anything related to contracting with the government.

The informal atmosphere also provides an opportunity to network with other contractors; discuss current issues; identify upcoming solicitations or subcontracting opportunities; and receive instruction on specifics such as how to register in Wide Area Workflow or resolve SAM (System for Award Management) issues. And it is a great platform to find answers to questions that you didn’t even know you needed to ask.

The Contracting Coffee Hour (sorry, no drive-through) is hosted by KEDA and facilitated by Mary Jo Juarez and Mona Carlson, both retired government contracting officers. Sessions take place at KEDA (4312 Kitsap Way #103 in Bremerton) from 7:30 a.m. until the questions run out. In recent sessions, Chugach, the new Base Operating Servic-

es Contractor, provided guidance on how to get established in their subcontracting program. There was also an impromptu session on marketing to government that included evaluating and updating capability statements, line cards and business cards.

Another benefit of the coffee hour sessions is that KEDA has been able to identify problem areas and expand and target their training to be responsive to the issues contractors are facing.

KEDA’s PTAC training schedule and resources are available online at www.kitsapeda.org/ptac.

So, if you haven’t managed to read all of the FAR’s 2,100 pages, (even if you have and you just have questions) call 360-3779499 or stop by the KEDA office the first Wednesday of each month for coffee and an answer.

• Mona Carlson has over 30 years’ experience in government contracting, recently working as a supervisory contracting officer for NAVFAC NW (Naval Facilities Engineering Command, NW). In addition to being a PTAC counselor, she also works as a government contracting consultant with Blue Ink Consultants. To learn about the PTAC program, contact Kathy Cocus at KEDA at cocus@kitsapeda.org.

10 |MARCH 2015

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Gig Harbor waterfront rezone plan stirs controversy This view looking southeast along Harborview Drive shows Susanne’s Bakery and Deli on the left. Susanne’s is at one end of the Millville waterfront area that would be affected under a proposed zoning amendment.

RIC HALLoCK

“We will not gain seating or space, but we do gain a world class view,” Doherty wrote.

State law prohibits spot zoning for specific properties.

The proposed amendment would encompass the water-

Proposed change would expand types of restaurants allowed in Millville district

By Rodika Tollefson KPBJ contributor A proposal to rezone a portion of Gig Harbor’s waterfront to allow a certain type of restaurants has caused controversy among local residents. The proposed amendment to the city code would allow class 2 and 3 restaurant uses in a portion of Millville.

Millville currently is zoned for restaurant 1 use via conditional-use permit — allowing a maximum size of 3,000 square feet, plus beer and wine for establishments under 1,200 square feet, but no grill or deep-fat fryer. Restaurant 2 would allow a grill and deep-fat fryer. Restaurant 3 would allow alcoholic beverages.

The Gig Harbor Planning Commission voted to recommend denial of the proposal last November. But the commission rescinded the motion at a following meeting, citing “substantial and unexpected” absences during the previous vote. A subsequent motion to recommend approval passed.

The move surprised local residents such as Carol Davis, who has been urging the commission to deny the amendment, writing letters to the editor and testifying at public hearings. Most of the concerns are centered on negative impacts on traffic, nearby residents and the quaint character of the neighborhood.

“It’s a big step that will totally transform the area,” said Davis, who was on the planning commission in the late ’90s.

Plans for new restaurant

The proposed amendment was submitted last year by Gig Harbor Marina Inc., which owns Arabella’s Landing Marina as well as several other buildings in the area, including one that houses the Netshed No. 9 restaurant and the Ship to Shore retail shop.

Two new buildings are planned for Ship to Shore on the same property, leaving its current building vacant.

John Moist, marina manager who submitted the application on behalf of property owner Stanley Stearns, said he was approached by Netshed owners Thad Lyman and his wife, Katie Doherty. The couple was interested in moving their other restaurant, Brix 25, to the future vacant building from their location on Pioneer Drive.

“They came to us with a plan and we thought it was a good business plan,” Moist said.

Lyman and Doherty said via email that they would like to relocate Brix so they can open a third restaurant at its current location.

front side of Harborview Drive between Rosedale Street and just past the Dorotich Street intersection. The affected area has two Restaurant 1 buildings, Netshed and Susanne’s Bakery and Deli.

Should the amendment be passed, a restaurant could not be established in the new zone without a conditional use permit. The existing restaurant, Susanne’s, would also need a new conditional use permit should it want to change the type of use. Any application for restaurant 2 or 3 would require a public hearing and a review by a hearing examiner.

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MARCH 2015 | 11

“I thought everyone would love as a closing time of 11 p.m.

The city’s planning direcThe city of Gig Harbor crethe idea of a nice restaurant in tor, Jennifer Kester, said she ated the historic Millville dishas only identified five proptrict in 1991 with the intent of the neighborhood.” erties that would allow for providing “an intensity and restaurants in that area, and scale weighted toward a resiJohn Moist, property manager those sites include Netshed dential-recreational use” and for area of requested zoning amendment and Suzanne’s. protecting existing residences while still allowing some development options.

IN COUNCIL’S HANDS The city changed restaurant 1 uses for Millville in 2011 The city council had a public hearing on the proposed to allow alcoholic beverages for establishments up to amendment on Feb. 23. Of the 28 people who testified, 13 1,200 square feet, as well as to extend permitted closing were opposed, 12 were in favor, and three had ideas for time to 9 p.m. from 7. the council’s consideration.

That amendment was requested by Moist on behalf of Instead of holding a second reading, the council decidStearns and his wife. It also brought opposition from residents at the time — but, noted Gig Harbor City Councilman Paul Kadzik, “has been a non-issue” since then.

Kadzik, a former planning commission member, was involved with the Millville zoning as a resident in the early ’90s. He said Millville would have been zoned as residential on one side and commercial on the other, so residents petitioned the city for a buffer zone.

He said the nature of residential Millville has changed since then. At the time, most homes were rentals and “for the most part, in a pretty sad state of repair.” The Kadziks, as well as many of their neighbors, had children in school.

“Now we know it’s a good, solid residential neighborhood,” he said, adding that with all those kids now grown, most residents are empty nesters.

“I like the amenities and being able to walk to them downtown,” he said. “But I understand people who want a residential feel.”

Carol Davis, a former Millville resident who lived for 18 years across from what is now Netshed No. 9, is one of those who expressed concerns for the residential feel of the neighborhood as well as other nuisances like increased traffic, noise and odors.

“I think the city has the mistaken belief that more business will create economic vitality and perhaps produce more tax revenue,” she says. “One or two restaurants will not support Millville because you’d need people shopping there on a regular basis.”

Much of the opposition has come from an activist group called Citizens for the Preservation of Gig Harbor, whose major concern is that the city is allowing the downtown to lose its character. The group expressed the same concerns in 2013 when the city changed the downtown business district height restrictions to allow taller buildings in hopes to foster more economic development.

Jeni Woock, a spokesperson for the group, wrote in a recent guest column that the change in zoning would allow fast-food restaurants to come to downtown, and even create a row with as many as 10 restaurants.

City planners have disputed that notion, pointing out that fast-food restaurants have been allowed elsewhere downtown since 1990 but none have expressed interest.

The downtown design standards, size and other regulations have been among the deterrents.

A visioning process several years ago sought public input on future uses of downtown. The second-highest need identified by the 120 people who attended the town hall meeting was restaurants, second only to groceries.

Moist said he didn’t expect to see the public outcry over his proposed amendment.

“I thought everyone would love the idea of a nice restaurant in the neighborhood,” he said.

Following the public hearing in November, he submitted changes that included a smaller affected area as well EMOTIONS STIRRED

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ed to have a study session to discuss issues and potential changes to the planning commission’s proposal. Some of the questions include whether there should be limits for deep-fat fryers, the bar area and delivery times, and whether the hours recommended by the planning commissioners — 6 a.m. to 11 p.m. — are appropriate.

If the council decides to modify the planning commission’s recommendations, it must hold another public hearing. A decision will likely not be made until the end of April or early May in that case.

Moist said he expects the new Ship to Shore buildings to break ground by May and be finished by the end of the year. Provided the city approves the zoning amendment and later a conditional use permit, Brix could move in around early 2016 at the soonest.

12 |MARCH 2015

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retirement planning | Jason parker

Eight mistakes to avoid in a long-range plan

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lanning for retirement is important, and here are eight critical retirement planning mistakes to avoid.

1. Not having a cashflow plan: Retirement is all about cash flow, not your net worth. Your income will determine your lifestyle in retirement.

Now that you are retiring, what you have accumulated needs to provide for your income needs for the remainder of your life. Spending too much in the early years or experiencing significant losses in the early years could result in running out of money before you run out of time.

2. Not having a budget. Many high net worth/high-income earners have never lived on a budget. Because their wages are high, they have just lived comfortably and been able to save along the way.

When you retire you no longer have earned income, so what you have saved needs to provide for you. To create a good cash-flow plan in retirement you need to have a good handle on how much money you spend every month and year. Underestimating your budget could throw off all the calculations you make when creating a retirement plan.

The more accurate your budget, the better your cash-flow plan. I’ve used and recommend mint.com as a tool to help track where your money is going. Benjamin Franklin once wrote, “A small leak will sink a great ship.” Create a budget before you retire and practice sticking to it.

3. Not maximizing Social Security.

For many people Social Security will represent 40 percent or more of their guaranteed retirement income. Social Security is tax-advantaged income, inflation-adjusted and has spousal and survivor benefits that need to be considered. A poor choice when starting Social Security could result in $100,000 or more of lost benefits and could be the difference between having enough money to last the rest of your life or running out too soon.

4. Having debt. If you envision retirement as a time of freedom, travel, spending time with loved ones and service to others, then having debt may hinder your dreams and your sense of confidence. I’ve found the most successful retirees pay cash when buying used cars; pay off credit cards every month and only justify using them at all as a means of accumulating travel rewards; and, in the best-case situations, have paid off their mortgages.

5. Assuming unrealistic stock market rates of return. Since 1926 the stock market, as measured by the S&P 500, has averaged annualized returns a little more than 10 percent. The key to these returns is time. Over shorter periods of time, the stock market can trade sideways or negative. Assuming constant rates of returns of 7-10 percent may make your retirement numbers look good, but may not be realistic given your retirement time horizon.

If you are thinking of buying stocks today, then you should take into consideration that the S&P 500 looks expensive relative to history when using priceto-earnings on a cyclically adjusted basis. Robert Shiller is a Nobel prize-winning economist well known for the CAPE ratio. This fundamental, inflation-adjusted means of valuing the stock market has the S&P 500 with a CAPE higher than 27 while the median over the past 130 years has been closer to 16. There have only been three times in the last 130 years when stocks have been more expensive.

With yields on 10-year treasuries yielding less than 2 percent, I’d say bonds are also looking expensive on a historical basis.

When making assumptions about future rates of return, I like to say, “Let’s hope for the best, but plan for the worst.”

To be safe, I’d recommend only assuming a 4 percent rate of return on your at-risk assets when constructing your retirement plan.

6. Not planning for long-term health care costs. Most people will be eligible for Medicare when they turn 65 and many will choose to purchase a supplemental policy to cover the 20 percent of health care costs Medicare does not cover. However, according to Steve Brown, a local long-term care insurance agent, fewer than 9 percent of people have insurance for long-term care health costs that are not covered by Medicare or supplemental plans.

These are the types of health care events that result in the need for assistance for an extended period of time. They can be brought on by stroke, heart attack, cancer, dementia, Alzheimer’s, Parkinson’s, MS and the list goes on. According to Genworth’s website, a recent study shows that 70 percent of people over 65 will need some type of support. In Washington state, the average monthly cost for a private nursing home room is $8,500 per month. Many people I’ve met with don’t want to believe that any of these things could ever happen to them. They point to their good eating habits, healthy lifestyle choices, family history and argue that they will never

Like us here? Like us there.

end up needing assistance. While no one wants to think about possibly losing our independence due to health problems, not planning for this type of expense could significantly strain, if not completely wipe out, a retirement plan. Worse, it may lead to adult children having to consider becoming caregivers. There is an old saying that says, “One mamma can take care of eight babies, but eight babies can’t take care of one mamma.”

7. Not planning for inflation. Ask anyone who retired with a fixed pension 20 years ago about inflation, and you will get an earful. During the last 100 years, inflation has averaged 3.3 percent as measured by CPI and during the past 10 years has averaged 2.3 percent. The Federal Reserve has an inflation target of 2 percent over the medium term. When planning for future income needs, be sure to consider the fact that your dollars will purchase less in the future than they do today. Create a plan that assumes you will need more money to maintain your lifestyle needs in future years.

8. Not having a plan for when one spouse dies. Oftentimes with married couples, one person manages the household and one person manages the financ-

es. Unfortunately when the spouse who manages the finances passes away or experiences a significant health event, the other spouse can be left in a fog of uncertainty about what they should do, where things are and what should happen next.

Not only do you need to make sure the surviving spouse will have enough income to maintain his or her lifestyle, but also the surviving spouse needs to be able to have the confidence to be able to carry out the plan that was originally created.

• 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 in Silverdale. Follow Jason’s blog at www.soundretirementplanning.com.

Links used for researching this article: • www.multpl.com/shiller-pe/ • www.rwjf.org/content/dam/farm/ reports/issue_briefs/2014/rwjf410654 • www.genworth.com/corporate/ about-genworth/industry-expertise/ cost-of-care.html • financeandinvestments.blogspot. com/2015/01/historical-annual-returnsfor-s-500.html • data.bls.gov/pdq/SurveyOutput Servlet • www.federalreserve.gov/faqs/ economy_14400.htm

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MARCH 2015 | 13

financial focus | edward jones

Women may face extra challenges in seeking financial security Article provided by Edward Jones for use by financial advisor David Hawley Jr. of Belfair.

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n March 8, we observe International Women’s Day. On this occasion, thousands of events across the world will honor the cultural, political and social achievements of women. Of course, in many countries, women still face significant economic challenges. And even here in the United States, women encounter more obstacles than men in the pursuit of financial security, particularly in seeking a comfortable retirement lifestyle. So if you are a woman — regardless of your marital status — you will need to be aware of these challenges and take steps to overcome them.

Let’s consider a few of these challenges and some possible solutions:

Challenge: Women spend more time out of the workforce and accumulate less money in 401(k) plans.

Women spend an average of 12 years out of the workforce caring for children or elderly parents, compared with less than two years for men, according to the Social Security Administration. This time away from work can translate into less money in retirement plans — in fact, women’s average 401(k) balance is only about two-thirds as large as men’s, according to a study by Fidelity Investments.

Potential solution: Take full advantage of your 401(k) and IRA. Your care-giving obligations are an issue to be decided by you, your spouse and perhaps other family members. But while you are working, contribute as much as you possibly can to your

401(k) or similar employer-sponsored plan. Also, try to fully fund your IRA each year.

Challenge: Women typically live more years in retirement and depend more heavily on Social Security.

Women reaching age 65 are expected to live, on average, an additional 21.6 years, compared with 19.3 years for men, according to the Social Security Administration, which also reports that the average annual Social Security income received by women 65 years and older was about $12,500. Furthermore, Social Security comprises about 50 percent of the total income for unmarried women age 65 and older, compared with just 36 percent for elderly men.

Potential solution: To become less dependent on Social Security, create a sustainable withdrawal strategy for your investment portfolio.

Social Security was designed to supplement one’s retirement income, not replace it. Consequently, it’s essential that you make full use of your other sources of income, such as your 401(k), IRA and other investment accounts.

To make this money last, you’ll see women | 14

Look through this ‘LENS’ when making Social Security decisions Article provided by Edward Jones for use by financial advisor Todd Tidball of Poulsbo.

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our Social Security benefits can be an important part of your retirement income strategy. But when should you start taking these payments?

You can begin accepting Social Security as early as 62, but your monthly checks will be much smaller than if you wait until your “full retirement age,” which will likely be between 66 or 67.

And these monthly payments will get even bigger if you wait until age 70, at which point they “max out.” So, should you take your Social Security as early as possible and hope that the smaller monthly payments will be justified by the extra years of receiving them, or should you wait until you are older and hope that

the bigger checks will be worth the delay?

In weighing this decision, consider the acronym LENS, which stands for Life expectancy, Employment, Need and Spouse.

Let’s look at each component: Life expectancy — If your family has a history of longevity, and if you are in excellent health, it may make sense for you to take Social Security later, when your monthly benefits will be higher.

You’ll also want to consider your spouse’s life expectancy.

Employment — If you want to keep working in your “retirement years,” be aware that your earnings could affect your Social Security payments. Specifically, if you take Social Security early — that is, before your full retirement age — your benefits will be withheld by $1 for every $2 in earned income above a certain see lens | 14

14 |MARCH 2015

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business openings

CKFR medic offers local option for safety training

By Tim Kelly KPBJ editor A Central Kitsap firefighter and EMT has started a business for teaching first aid and CPR classes to Kitsap and Mason County residents.

Kevin Bernt opened Compressions for Life, an American Heart Association training facility, at 701 Pacific Ave. in downtown Bremerton.

The mission of Bernt’s operation is “to train our neighbors and community to be efficient and confident in an emergency.”

He will incorporate his real-world experiences dealing with emergencies as a firefighter and paramedic into the training he provides at Compressions for Life.

Certification is offered in CPR, First Aid and Automated External Defibrillator (AED). The classes are geared toward people whose jobs require them to have such training, but the classes are open to anyone would like to be trained.

“The more people that know CPR, the safer our community becomes,” Bernt said.

In addition to working for Central Kitsap Fire & Rescue, Bernt has been teaching various pre-hospital medical classes for the past 10 years, including as a senior wom eN | f rom 3

need to create a sustainable withdrawal strategy early in your retirement — and stick to it.

Challenge: Women are far more likely than men to need some type of long-term care.

More than two-thirds of nursing home residents are women, according to the National Center for Health Statistics. And the average cost for a private room in a nursing home is more than $87,000 per year, according to the 2014 Cost of Care Survey produced by Genworth, a financial services company. Typically, Medicare cov-

Kevin Bernt, left, a paramedic for Central Kitsap Fire & Rescue, teaches a cardiopulmonary resuscitation class. He is the lead instructor at Compressions for Life, a new business in downtown Bremerton that provides CPR, First Aid and other safety training.

LARRY STEAGALL

EMT instructor for Kitsap County Emergency Medical Services.

Education has been a priority and passion for him, and he has a master’s degree from Arizona State University in Science in Public and Fire Administration.

Bernt, who’s originally from Portland

ers only a small percentage of these costs.

Potential solution: Prepare in advance for long-term care expenses.

Long-term care costs can be enormous, but you do have some protection-related options for meeting these costs.

Check with your financial advisor to learn which of these choices might be most appropriate for your situation.

These aren’t the only financial issues facing women, but they do give you a good idea of what you may be facing.

So, be proactive in meeting these challenges — because there’s actually a lot you can do.

and has worked at CKFR for seven years, began offering classes in Bremerton in December and said he’s gotten a good response in trying to get the word out.

“It’s been pretty positive,” he said. “I just did the (Kitsap Business) Expo. I felt like people here who have the need have

l eNS | f rom 3

amount ($15,720 in 2015). During the year in which you reach your full retirement age, this withholding changes to $1 for every $3 in earnings over the annual limit ($41,880 in 2015). The withheld amounts could also affect spousal benefits. However, beginning the month you attain your full retirement age, benefits will no long longer be withheld based on how much you earn.

Also, Social Security will recalculate your benefits at full retirement age to account for the benefits that were withheld. In any case, if you do plan to continue working, and you think you could have significant income, you’ll need to under-

been going to Tacoma or Seattle, because there’s not a class based here.

“It provides a place to go and get trained, and it’s cheaper than Seattle or Tacoma.”

Bernt also will schedule presentations at workplaces. “You don’t get certified but you get training,” he said.

Certification for training completed at Compressions for Life is through Inland Northwest Health Service.

For now Bernt is the only instructor for the classes, which can accommodate up to 12 people. The different classes are offered a few times a month with the schedule posted online, and classes are either Wednesday or Thursday evening or Saturday morning. This summer he hopes to offer advanced cardiac life-support classes.

Bernt hopes the Compressions for Life class fees will cover the operating expenses for his business, which will have an official ribbon-cutting with the city and Chamber of Commerce in June.

“I don’t see it as huge profitable venture; it’s not that kind of business,” he said. “I’m just kind of doing it to provide a service to the public.”

For more information about classes, call 360-731-2507 or visit the website www. compressions4life.com.

stand the effect that earnings will have on your annual benefits.

Need — In deciding when to take Social Security, here’s a key question: Do you need the money? If you can support your lifestyle for several years with alternative sources of income (such as a pension) and modest withdrawals from your investments, you may be able to delay Social Security, thereby increasing the size of your monthly payments.

Be careful, though, because relying too heavily on your investment portfolio can shorten its own “life expectancy.” It’s essential that you maintain a reasonable withdrawal rate for your investments throughout your retirement.

Spouse — Your decision of when to take Social Security will affect

your spouse’s survivor benefit. Surviving spouses can receive their own benefit or 100 percent of their deceased spouse’s benefit, whichever is greater. So, if you were to take your Social Security early, when the payments are smaller, your spouse’s survivor benefits will also be permanently reduced.

If you are older than your spouse, or otherwise expect your spouse to outlive you, it might be a good idea to delay taking Social Security to maximize the survivor benefits.

As you think about when to take Social Security, look at your decision through the LENS described above. It could help clarify your options.

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16 |MARCH 2015

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BUSINESS OPENINGS

Rural lifestyle retailer opening Port Orchard store at vacant site

By Tim Kelly KPBJ editor For the second time in the last few months, a national company has announced plans to expand into Kitsap County and will move into a large commercial space that’s been sitting empty.

Tractor Supply Co., which bills itself as “the largest rural lifestyle retail store chain in the United States,” will open a store in May at the former site of Saar’s Market Place in Port Orchard.

A temporary sign along Mile Hill Drive in Port Orchard notifies passersby of the Tractor Supply Co. store that will be opening in May. The store will go in the vacant shopping center at the corner of Mill Hill Drive and Olney Avenue where Saar’s Market Place was until its closure last year.

TIM KELLY PHOTO

Visit Kitsap Peninsula annual meeting will review tourism growth, outlook Visit Kitsap Peninsula will host its annual meeting on Thursday, March 12, at the Best Western Plus Silverdale Beach Hotel. The event will present “The Route to Success & Opportunities” and review record economic growth in Kitsap’s tourism sector, major construction projects, trends, and opportunities to collaborate with regional partners in Olympia and Pierce and Mason counties. VKP will also unveil its new website.

The Silverdale Chamber of Commerce and Central Kitsap Community Council’s Economic Development/Tourism Committee will join the VKP to welcome the newest Kitsap County commissioner, Ed Wolfe, who represents Central Kitsap District 3. Wolfe will share his vision for the county and its tourism industry.

Due to the significant increase in tourism-related construction and major events in the past several years, the VKP invited Commissioner Charlotte Garrido to share details about Kitsap County’s 2035 Comprehensive Plan. Staff at the Department of Community Development (DCD) is tak-

ing a pro-active approach and actively reaching out to the community and industry leaders to solicit input that will shape the region for the next 20 years.

The previous Kitsap County comp plan has few references to Kitsap’s tourism industry and this is a historic opportunity for tourism stakeholders to provide input. The comp plan update will impact Kitsap’s tourism industry today and in the future. DCD has been working with stakeholders for the past year and is in the process of integrating Kitsap’s first agri-tourism program and policies into the county’s comprehensive plan.

Other activities at the annual meeting include a mini-business expo that will feature displays and information about Kitsap’s event venues and services. Representatives from Kitsap County Public Works will also be on hand to share information about the Bucklin Hill Bridge Project.

Tickets for the buffet luncheon are $20 and may be purchased online at www.VisitKitsap.com/AnnualMeeting.

Based in Brentwood, Tenn., Tractor Supply has 1,400 stores, including one in Puyallup. All stores are company-owned, not franchises.

“As a growth-minded company, Tractor Supply Co. is always looking for potential new store locations that are a good fit as far as the target market is concerned,” company spokesman Rob Hoskins said in an email to the Kitsap Peninsula Business Journal. “Concerning the location in Port Orchard, this is especially true in that the area was attractive due to the part-time and hobby farmers, and horse owners in the area.”

The stores carry lawn and garden supplies, animal care products, workwear, power tools, riding lawnmowers and equipment such as welders and generators.

Hoskins said the Port Orchard store will have 12 to 17 employees, and a “soft opening” is tentatively scheduled for May 9, with a grand opening a week later.

The 42,000 square-foot building

has been empty since Saar’s closed last May. It is located at the corner of Mile Hill Drive and Olney Avenue, in a mostly empty shopping center that also includes a long-vacant former Kmart store.

In Bremerton, a new tenant is moving in this spring to part of the empty big-box site on Wheaton Way. Fitness Evolution announced in December that it will renovate the building once occupied by an Albertson’s store for a new 23,000-square-foot fitness center.

Saar’s still owns the former grocery store building that Tractor Supply is leasing in Port Orchard, but the rest of that center is owned by a California-based management company that said it has no prospective tenants at this time.

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18 |MARCH 2015

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julie tappero | human resources

Businesses should prepare for Baby Boomers’ departure

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here’s a dark cloud on the horizon that may be threatening your company’s ability to function. If you’re like two-thirds of the other companies in the United States, you are happily ignoring this dark cloud and doing nothing to prepare your business.

What could this awful impending crisis be? Take a look at the faces of your co-workers. Do you see Baby Boomers? Ten thousand of them are retiring every day! And when they do, they take with them a lifetime of knowledge and soft skills that can be harder to find in the workforce today.

What’s your company doing to prepare for their departure?

During the Great Recession, we know that many Baby Boomers delayed retirement or even rejoined the workforce to rebuild their savings. But now that the economy is recovering, they once again have some options. As someone who spends time in workforce development and economic development, I constantly hear from employers that younger people entering the workforce often lack soft

skills, such as teamwork, commitment, ethics and communication, which mature workers bring to the table. Before we let our mature workers walk away, how do we transfer it’s beneficial their technical and to retain your knowledge soft skills to new current older workers?

A great place employees for your business to start is with while you AARP’s free online Workforce create a Assessment Tool.

This brief screensystem for ing tool allows them to you to enter specific information transfer their about your workknowledge to force, provides a personalized your workers. analysis of how retiring workers will affect your company, and addresses what skill shortages you may face.

A study by the Society for Human Resource Management revealed that the im-

pact will hit some industries more than others. Particularly hard hit will be government agencies, utilities, health care, social assistance, finance, insurance, real estate, and organizations that are grantmaking, civic, religious and professional, etc.

Once you have an idea of the impact your company is facing, you can take some steps to prepare.

First of all, it’s beneficial to retain your current older employees while you create a system for them to transfer their knowledge to your workers. In order to do that, you may need to change some of your workplace policies.

The Society for Human Resource Management report revealed some of the key benefits that attract and retain older workers. At the top of the list was flexibility in work location. I know many Washingtonians who go to Arizona in the winter. Perhaps if they could take their work with them, they wouldn’t have retired quite so soon. Second was career flexibility, such as reduced responsibilities, and third was work hour flexibility, such as job sharing or phased retirement. I kept a bookkeeper on staff for a couple extra years by reducing his duties and letting him work from home, where he could take care of an ill spouse.

In other words, recognizing the older workers’ changing priorities and bringing flexibility to the table may help delay the abrupt loss of a valued employee.

As we all know, when someone does a job for many years, they end up with institutional knowledge in their heads, and oftentimes it’s not written down anywhere.

Now that you’ve retained your older worker, the next step is to promulgate some transfer of their knowledge to others in the workplace.

One way to facilitate this is to create a formal cross-training program in the business, making sure that there is more than one person capable of performing the essential functions of the job. If your older worker starts to work a more flexible schedule, the cross-trained employee can step in for them periodically to ensure the person is fully capable in the position.

Pairing an older worker as a mentor to a younger worker has many advantages in the workplace. Much has been written about the challenges of having a multigenerational workplace. Encouraging baby boomers to work intimately with millennials can break down those barriers.

But it has the added advantage of helping younger workers see soft skills in action and to learn from their mentor why those skills have been important in the growth and success of the mentor’s career. A mentor is someone who models positive behavior through trust, so creating mentorships can effect change and create better relationships between co-workers.

One note of caution. The Age Discrimination in Employment Act protects anyone over the age of 40 against age discrimination. If you ask a 64-year-old person what his or her retirement plans are, and then you take some adverse action against the person shortly after that, you may very well find yourself with an age see boomers | 23

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Market: Delivering the goods, or oversold? meat science from Texas A&M University, was doing consulting work in the Seattlearea food industry when he heard about the planned Port Orchard butcher shop just over a year ago. Since he was looking for other opportunities at the time, he decided to explore one in the community that was the longtime home of his wife’s parents.

“We came on out, and I just got presented the slickest, smoothest opportunity that there was out there,” Brozovic recalled, adding with a laugh, “It was truly a

LARRY STEAGALL FILE

Brian Brozovic is shown in February 2014 as he works to get the Bay Street Meat Co. ready to open in the new Port Orchard Public Market.

Developer of Port Orchard’s much-hyped market still spins ambitious vision for downtown, but former partner says he got burned after slick sales pitch

by Tim Kelly KPbJ editor Last year began with the enticing prospect of starting a butcher shop as a family business in his pregnant wife’s hometown, and Brian Brozovic went all in. But by December he was out of the Bay Street Meat Co. — forced out, he says, by the guy who first pitched the golden opportunity at the Port Orchard Public Market. After spending much of the year working to help get developer Don Ryan’s hyped market venture off the ground, Brozovic bottomed out and wound up going to the local food bank to get a Christmas basket for his family.

The butcher shop, a seafood vendor and Ryan’s own Central Dock restaurant and bar were touted as anchors for the new market, which opened last spring after property owner Mansour Samadpour invested nearly $1 million in the redevelopment project at a long-vacant site in downtown Port Orchard.

Although Ryan puts a positive spin on operations at the market — pointing to two businesses that have expanded, and a weekend vendor that plans to become a boom er s | f rom 18

discrimination lawsuit on your hands.

However, you do have the right to ask all employees what their long-term goals are with the company. Doing this as part of their annual performance process, and hopefully with a good relationship and communication process, your retirementage employees will feel free to let you know their future plans. Then you can start a succession planning process and let them know what their own options are.

full-time tenant — both Bay Street Meat Co. and Northwest Seafood & Wine are struggling to survive. The seafood shop, operated by the owners of Mason County-based A&K Shellfish Co., has been listed for sale on commercial real estate websites and craigslist with an option to take over the lease.

The market that originally was supposed to have 20 or more vendors and employ 50 to 60 people has only seven fulltime vendors, and there aren’t many employees other than the small business owners themselves.

Some vendors point to a need for better marketing for the destination, including a plea for better support from the property’s owner, Samadpour, and there are questions about where the venue fits in an overall vision for his downtown holdings. And Ryan, the biggest cheerleader but also at times a controversial figure in business dealings on Bay Street, says that community support will ultimately determine whether the venture will last.

High hopes in adopted home

Brozovic, a Texas native with a degree in

By working together, offering your employees the flexibility to phase into their retirement, and acknowledging their value to the business by asking them to transfer their knowledge to others, change will happen without negative impact on the organization.

• 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.

used car salesman at work.”

Ryan started as a car salesman in 1989 at Quisenberry Bay Ford (now Titus Ford) in Port Orchard, and he’s long run his own used car lot, currently located on the unpaved property on Sedgwick Road where he also lives and rents space to a taco truck. His other business ventures include a hair salon, rental properties, and the 110 Lounge in Poulsbo (the 110 in downtown Port Orchard closed in January, but a revival may be in the works.) Another venture see marKeT | 27

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federal contracting | steve shapro

Kitsap home businesses establish themselves as parts suppliers to Navy

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ith the Navy presence in our area, it’s not surprising there are business opportunities for local firms to furnish supplies and services the Navy needs to accomplish its mission. It then should come as no surprise that two local small businesses were established to supply parts, or that they were awarded a total of about $9 million in contracts over the past three years.

What is surprising? They are both homebased businesses.

Government contracting offices typically don’t comment publicly regarding the performance of contractors, but the fact that these two small businesses have received hundreds of purchase orders attests to a strong performance record.

A few years ago, Keith and Lydia were looking for an idea for a home business that would permit Lydia to spend some time at home and supplement their incomes. They’d heard from friends — one a retired government buyer, another who worked with a parts supplier — about the Navy’s appetite for parts and supplies to support ships and installations. They established a small business and navigated through the maze of federal contracting regulations to establish themselves as parts suppliers.

During the first few months, Keith says they were excited when they received one or two orders a month. Now, operating from their East Bremerton home, they fill as many as 10 to 20 orders per day and had over $1.5 million in sales to the government during the last fiscal year alone.

In addition to sourcing parts and supplies for local ships and installations, including the Puget Sound Naval Shipyard and Intermediate Maintenance Facility, they also send parts to Navy activities in Japan and on the island of Diego Garcia in the Indian Ocean. Along the way, they’ve expanded their business to include many commercial customers outside the government.

Keith and Lydia’s company is awarded contracts for a wide range of parts and supplies, items including filters, seal rings, gauges, packing, gaskets, hose assemblies, screws, electronic components, and wire rope that have applications on ships and in Navy facilities. They don’t manufacture any of these items or carry an inventory. Instead, they specialize in sourcing the parts and supplies from large distributors and equipment manufacturers.

When asked why he thought the Navy went to them when soliciting quotations, instead of going directly to large distributors or manufacturers, Keith said he believed many buyers preferred sourcing parts and supplies from a small business that was responsive and customer-focused.

“We move more quickly than a large company,” he observed, “and we make sure the parts get to where they are needed, on time.”

Keith pointed out that as a home business, they have low overhead and can remain competitive in their pricing.

He said they are often successful tracking down hard-toidentify parts for older and obsolescent equipment, some manufactured by companies no longer in business, before larger companies are able to respond.

“Buyers are appreciative of prompt and reliable customer service, so they’ll be more likely to request us to provide pricing on future Navy requirements,” he said.

Keith also pointed out that since they are a small business, the government gets credit towards meeting congressionally mandated small business contracting goals.

Their company makes a conscious effort to keep busi-

ness local, in Kitsap County.

“We’ll often source a part to a local distributor even if the price is a little higher to keep the business local,” he said. “Sometimes getting the part quickly from the local distributor is what allows us to be successful meeting our customers’ demanding delivery dates.”

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cross Dye’s Inlet, Steve and Elayne Burton run EHB Supply from their home in Silverdale. The couple initially owned a business that developed, marketed and distributed an extensive inventory of shareware software applications. In the late 1990s, the spread of Internet connectivity and online access to software programs threatened the viability of their business model.

Fortuitously, they were approached by a Navy project manager seeking a specialized software program for one of the aircraft carriers in the shipyard. He’d run out of options and had resorted to calling software firms listed in the Yellow Pages. While Steve and Elayne were successful in locating the needed software and sourcing it for the project manager, their most important lesson was learning the ropes selling to the Navy and getting paid for their work.

Fast-forward 16 years to their current business, EHB Supply. Last year they were awarded $2.6 million in contracts for selling everything from electrical components to mechanical hardware to the Defense Department.

Their customer base not only includes local ships, bases and the shipyard, but also Navy activities in Japan and Defense Logistics Agency buying offices on the East Coast.

Elayne pointed out they had some help along the way figuring out how to work in the complicated federal contracting system. “We often heard how hard it was to do overcome the high barriers to entry and how much had to be learned to do business with the government, but it can be learned,” she observed. They received invaluable assistance from a Defense Department-funded office called the Electronic Commerce Resource Center (ECRC), which was then housed in Kitsap Economic Development Alliance’s offices in Bremerton. “They provided us a great deal of help figuring out the contracting process,” Elayne said.

While the ECRC no longer exists, a successor organization, the Washington Procurement Technical Assistance Center (www.washingtonptac.org), provides assistance to small businesses seeking government contracting opportunities.

After their initial success and armed with information from organizations such as the ECRC, Steve began calling local buying offices. He convinced some of the purchasing agents to solicit quotes from EHB Supply, especially for parts that were hard to find. They were successful in sourcing the items, reliably and consistently getting them to where they were needed on time. They developed a strong reputation among buyers as being able to identify and source the most difficult parts, including ones that had become obsolescent and non-standard.

“We sometimes get lists of over a hundred parts at a single time. We research each item and source it to the distributor or manufacturer who can provide the best price so we can get the best overall deal for the government,” Elayne said.

She said the work of being a supplier is often challenging and the variety makes it interesting. Knowing that U.S. servicemen and women depend on the parts and supplies, the work is also rewarding: “We take the job very seriously and understand that we can’t afford to make a

mistakes because of who we support.”

These two businesses did not become successful overnight. It took hard work to learn the government contracting system and the inner workings of the Defense Department supply system. By being persistent and providing outstanding customer service, these two Kitsap small businesses, operating from their homes, successfully created a niche sourcing parts and supplies for the Navy and Defense Logistics Agency.

• Steve Shapro is a former Navy Supply Corps Captain, and after retiring from the service he worked for the Navy in a civilian role as chief of a regional contracting office and as the Deputy for Small Business. He recently founded Seabeck Research, a consulting firm providing information and analysis to companies interested in government contracting work. His website is www.seabeckresearch. com.

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WWW.KPBJ.COM Don Ryan, developer and manager of the Port Orchard Public Market, is shown in February 2014 speaking to the crowd at a benefit held for the downtown market before it opened.

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that he hasn’t publicized is G4 Partners, which he set up in a bid for a license for a retail marijuana shop. G4 wasn’t selected in a lottery for allocating licenses to Kitsap County applicants.

In 2012, the same year he began promoting and originally hoped to open the downtown market, Ryan said he was going to build a microbrewery and restaurant on his Sedgwick Road property.

“We believe by building this, we’re going to have quite a venue for keeping people in our town, and we’re going to have a destination that will draw people from out of town,” Ryan said in a Kitsap Sun article at the time.

The brewery project fizzled because he couldn’t get financing, but it illustrates Ryan’s penchant for promoting his ambitious “destination” ideas. That’s a pitch Brozovic says he became all too familiar with.

When Ryan first showed him the downtown building being renovated for the market, “it was like, ‘here’s your butcher shop,’” Brozovic said. The developer laid out his vision of a “big, booming market” that would see “60,000 visitors coming though every summer.”

With the market opening on the horizon, Ryan needed a quick answer. Brozovic talked it over with his wife, said yes, and they sold their home in Fife and moved to Port Orchard.

“My dream was always to open a butcher shop,” Brozovic said. Even though he’s only 32, “That’s what I envisioned for my retirement.”

Brozovic said he accepted Ryan’s offer — even though it meant taking a 50 percent pay cut from his previous job — because he was told it would include a 9 percent ownership stake in the Bay Street Meat Co. That was supposed to increase to an equal one-third share with Ryan and his investing partner, Paul Demoret, once their initial investment was repaid.

Dedication dashed

There was a lot of work to do before Brozovic sliced any steaks, though.

“They were looking for somebody to jump in there right then and help finish this building out, because of how long this

MEEGAN M. REID FILE

had taken to develop,” he said.

He was working 8 to 10 hours a day at the market, helping on much more than the meat shop. “I’m painting floors, I’m sealing floors, I’m hanging doors — I’m like one of the contractors,” he said.

He recalled working one weekend after heaters were installed in the building.

“I was in there all day breathing epoxy fumes,” he said, because the interior had to be kept warm enough to seal the concrete floors, and it was too cold outside to roll up the front door for venting.

“That’s how dedicated I was to the market,” Brozovic said. “I did everything I could to get this market open so I could get my business going.”

When asked about Brozovic’s involvement in the market, during a recent interview, Ryan didn’t want to say much about Brozovic’s departure. Ryan insisted the butcher was never a partner in the business. Brozovic confirmed he never had the ownership stake offer in writing or any signed agreement for the promised stake.

“He had the ability to be a partner,” Ryan said. “He was never, ever an owner, at all.”

Brozovic’s name was not listed on business registration records with the state, but numerous articles in the media and online business listings for Bay Street Meat Co. at the time referred to him as a partner, co-owner or co-founder. Brozovic also noted that he signed the shop’s lease with the market, as well as the federal form business owners have to sign to accept EBT payments (food stamps).

Ryan acknowledged that “we had some

financial issues in the first year of this market, and we made Brian an offer to stay on; he chose not to. So we parted ways.”

Brozovic’s version is that he never received a slight pay raise he was promised when the shop opened; that sales during the summer tourism season were less than anticipated and then dropped sharply through the fall; and that the last straw came in early December, when Ryan told him his pay would be reduced even though the business was going to cut two parttime workers (one of them Ryan’s teenage son) from the payroll.

Drawing people downtown

In an article last August published in the Port Orchard Independent newspaper, Ryan boasted that downtown had seen “an abundance of increased foot and shopping traffic” in 2014 because of the market’s opening. He mentioned a neigh-

boring business as a prime example.

“Lallie Mae’s — next to the market — has seen their foot traffic almost triple this past year because of the sheer volume of people coming back downtown,” Ryan was quoted saying at the time.

By year’s end, however, Lallie Mae’s became a casualty of Ryan’s financial patron taking over the whole block, even though the boutique’s owners had been big supporters of the market project.

“We worked hard there, and we felt we deserved to be there,” co-owner Jody Grutzeck said, noting that her shop (now relocated across Bay Street in a former restaurant space) was once the only fulltime business on that block, after Morningside Bakery closed and before development of the market began.

“We were the biggest cheerleaders for (the market),” she said. “For like two years we told everybody — I mean everybody, to come back, because Don Ryan, he’s awesome, he’s doing this …

“Little did we know that within a year after it opened, we would be booted out.”

Ryan disputes that too, saying that after Samadpour purchased the building, the shop owners chose not to accept a new lease they were offered — a more expensive “triple net lease,” in which the tenant pays property taxes, insurance, and maintenance and repair costs for the building.

“She was given every opportunity to stay,” Ryan said.

Grutzeck said Samadpour’s planned remodeling for the building would have required them to move out within six months

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anyway. But she did agree that the market was bringing more people downtown.

“And you know what? I really felt that we helped the market, because we were established there, and the bakery too,” she said, referring to a new bakery that opened in the former Morningside building (also owned by Samadpour) a few months before the market did last year. “The bakery brings a lot of people down too.”

Asked if the space Lallie Mae’s vacated next to the market could be where his 110 Lounge reopens in the future, Ryan would only say that he’s working on “some new branding ideas” for the bar and that “we may have the opportunity to bring the 110 back to Port Orchard. And we’re also looking at other options; it’s still for sale.”

Who’s marketing the market?

Brozovic said there were some good business days for the new market during the summer, especially days the Port Orchard farmers market was set up nearby on the waterfront. But when things slowed way down after summer, the shared frustration of the tenants was a lack of marketing for the whole operation, and their unfulfilled expectation that their landlord should spend some money on that.

“We started noticing that this was not what we had been sold on,” he said. “Now we need to be having people walking through the door … because it’s past summertime, and things are going downhill and going downhill quick.”

Brozovic said he went to Ryan and asked why Samadpour wouldn’t want to do some marketing — not for individual businesses, but to promote the overall place as a destination, similar to advertising that a mall would do.

Ryan said Samadpour wants to see the market succeed, but that business owners

Annie Fitzpatrick puts cheeses in a display cooler at Northwest Seafood & Wine. She and her husband own the shop in the Port Orchard Public Market, but they have their business listed for sale.

MEEGAN M. REID

typically pay for their own advertising. He did point to one television commercial for the market that he said aired on Wave Cable stations recently.

Ryan has asked others for help, however. In October he approached Visit Kitsap Peninsula, the organization that does tourism marketing and promotion for the entire region, asking for something to give the market a boost. That could be interpreted as ironic, because the Visit Kitsap budget is provided by a portion of lodging tax revenue from each city in the county.

Port Orchard is one of the cities that’s reduced the allocation of those taxes it sends to Visit Kitsap in recent years. Ryan influenced that decision by pushing for the city to spend a chunk of lodging tax funds to help Kitsap Transit run passenger ferries on weekend evenings between Port Orchard and Bremerton. Also, the Port Orchard Bay Street Association (POBSA), of which Ryan was president until the end of 2014, gets a larger share of the city’s lodging tax money than Visit Kitsap does.

Still, the market developer is also criti-

cal of what he perceives as a lack of promotion for city tourism in general.

“In my opinion, the real responsibility lies on the city of Port Orchard to start promoting its own town,” he said.

“The city of Port Orchard, in my opinion, doesn’t promote its own tourism.”

Ryan was ecstatic about a recent article describing Port Orchard’s food scene, including the new market, in the online magazine realfoodtraveler.com. The piece was written by a Portland-based travel writer who was invited and toured the area last September as a guest of Visit Kitsap Peninsula.

Ryan regards himself as someone making a difference in his community. “I have spent three years as president of POBSA, in total dedicated volunteer work for this town, I will say that,” he said. “And what has come out of that I think is positive.”

He’s also a businessman who ordered 100 poinsettias (but later canceled half his order) from South Kitsap Helpline’s nursery, at a price of $6.50 each, then sold them during the holidays for $9.99 in the

people in business Business consultant completes Certified Exit Planning credential Soundpoint Consulting founder and president Kelly Deis has completed the process to earn the Certified Exit Planning Advisor (CEPA) credential from the Exit Planning Institute.

Soundpoint’s current offerings include business valuations and value-driven strategy and operations consulting services for privately held companies in the Puget Sound region. With the CEPA designation, services will expand to more fully assist ownKelly Deis ers to grow, preserve and transition business wealth during an ownership transition.

The CEPA program includes a five-day executive-style MBA program at the University of Chicago Booth School of Business.

Deis also is a Certified Valuation Analyst (CVA) through the National Association of Certified Valuators and Analysts, and holds an MBA from The Wharton School of the University of Pennsylvania and a bachelor’s in mechanical engineering from Duke University.

market with a sign that said the proceeds benefitted Helpline’s food bank.

That’s the food bank that helped Brozovic’s family at Christmas.

Vision for property unknown

Samadpour’s lack of direct involvement in the market — the owner directs all questions through Ryan — raises the question about the vision for downtown.

Samadpour is a renowned microbiologist who owns IEH Laboratories and Consulting Group, a global company based in the Seattle area. Abadan Holdings LLC is the company that manages his Port Orchard properties that include much of downtown. He invested $1 million in the market property, but Brozovic said he doubts whether the owner cares about the market’s success, given the hints that major redevelopment is a long-range goal.

“What his grander scheme of things is, the market’s going to have to be torn down anyway,” Brozovic said, pointing to Samadpour’s other holdings on Bay Street, from the boarded-up Myhre’s building to the Port Orchard Pavilion.

Ryan denied that Samadpour — who he describes as a generous person — is uninterested in the market’s success. He did confirm that Samadpour’s long-term plans include condos on Bay Street, which he acknowledged could mean “rebuilding these buildings.” Samadpour declined to comment, referring all questions to Ryan.

“Yes, he would like to see an adult-living condominium center down here,” Ryan said. “But it takes six, seven, eight stories to do that.”

Two City Council members in Port Orchard said neither Ryan nor anyone else associated with Samadpour’s operation has ever asked the council to consider a

letters to the editor

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

Why rezone historic Gig Harbor neighborhood for restaurants?

Stafford Suites in Port Orchard hires outreach coordinator

During the public hearing on Monday (Feb. 23), a petition of Waterfront Millville residents and map of signatures was presented.

Five residents of Waterfront Millville were in favor of Mr. Stearns’ private request zoning amendment.

Folks were concerned about horrific traffic, noise and no parking. These restaurants would be open from 6 a.m. to 11 p.m., in addition to setup, closing and delivery times. Millville is a neighborhood of families, no sidewalks, kids playing in the street with little ‘kids at play’ signs.

The only folks who spoke in favor of more restaurants were folks who did not live in Waterfront Millville, whose homes and family life were not going to be affected.

Do you believe you have the right to determine your neighborhood, especially if it is a change to what you

Stafford Suites of Port Orchard has added Konnie Strom to its staff as community outreach coordinator for the assisted-living center.

Strom, who has a master’s in social gerontology, moved to Kitsap in 2013 from Independence, Missouri, where she worked in assisted living and long-term care for 18 years.

She is looking forward to being active in the South KitKonnie sap community and representStrom ing Stafford Suites, and providing an additional resource for seniors and their families. Strom is currently enrolled in the Leadership Kitsap class of 2015.

For more information on Stafford Suites or to schedule a tour, call 360-874-1212.

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have now?

Only two blocks, on the other side of Skansie Park, all these restaurants would be allowed without any special zoning requirements? Fastfood restaurants, restaurants with full bar, open extended hours are already allowed, just two blocks away.

Why is there no conversation about putting these vitality producing restaurants in waterfront commercial that could use a little vitality and parking is already available?

Isn’t a better solution putting these restaurants in an area permitted for them before making an “experiment” in the “soul” of Gig Harbor’s historic neighborhood?

Why is the only area under consideration this historic, residential neighborhood?

Why is any one person more important than our entire community?

Why? — Jeni Woock, Citizens for the Preservation of Gig Harbor

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Business name change reflects shift to add IT service

Olympic Technology Resources built its business providing remanufactured printer cartridges

By Tim Kelly KPBJ editor

In the ever-shifting landscape of new technologies, Jeff Petersen’s business is adapting because customers are doing less printing.

At the same time, those customers are relying more and more on technology in their business operations, and that’s why Olympic Printer Resources — which supplies remanufactured printer cartridges as a cost-saving option for its customers — changed its name in 2015 to Olympic Technology Resources.

“We have added services to support all of our client’s office technology needs,” Petersen said. “We have hired experienced staff to provide expert business information technology (IT) services.”

Those include computer maintenance and repair, installation of software and network security systems, cloud migration, network setup and administration (including wireless solutions), remote system monitoring and more.

“For 20-plus years, the hallmark of our business has been remanufacturing cartridges,” Petersen said during a recent interview at Olympic’s office and small warehouse, located in Arbor Business Park off Bond Road between Kingston and Poulsbo.

The company still sells about 600-800 rebuilt toner car-

same output and are 20 to 50 percent cheaper than a brand new one,” he said.

The operation’s environmental focus is intact as well. Petersen said it takes three quarts of oil to manufacture a new printer cartridge, and he said Olympic kept 56 tons of cartridges from going to landfills in 2013.

The challenge to Olympic’s business model is simply that customers aren’t needing replacement cartridges as frequently.

“The problem is people are printing less; on average it’s 8 percent a year,” he said. “Nowadays everything is scanned and emailed.”

Many kinds of documents LARRY STEAGALL PHOTO that once had to be proFrom left: Gary Welch, office solutions advisor, Jeff Petersen, company president, and vided in paper form — evErik Petersen, VP of operations, at the warehouse of Olympic Technology Resources erything from bank statein Kingston, which was formerly Olmpic Printer Resources. The company’s new name ments to real estate docreflects the IT services it offers now, in addition to remanufactured printer cartridges uments to HIPAA privathat have been its primary product since the business started two decades ago. cy forms at medical offices — now are routinely protridges a month and provides printer service and repairs, cessed in electronic records systems. and the appeal of their products hasn’t changed. The reIt’s not that Petersen, who bought a stake in the business see name change | 34 manufactured cartridges provide “the same quality, the

BusIness BrIefs Transportation issues will be topic at Kitsap Business Forum At the next Kitsap Business Forum on March 10, the topic for discussion will be “Planes Trains & Automobiles — We are in all in the in the Transportation Business.”

Kitsap is not known for its efficient and cost-effective transportation. Bottlenecks, rising tolls, and congested ferry services makes it difficult for any business to get their products and services to customers in Kitsap and beyond. The West Sound Alliance, a collaboration of government, business and civic leaders, has taken these challenges head-on. This year, a comprehensive plan is in Olympia to alleviate the transportation stress on Kitsap — and significant action is expected this year.

John Powers, executive director of Kitsap Economic Development, will facilitate a panel discussion at the forum on the area’s transportation issues. Elected officials and community leaders from the West Sound Alliance will discuss these issues: • Growth that’s increasing the need for improvements • Key road and bridge improvements, including tolls

• Ferry and other public transportation improvements • $470 million in proposed improvements and their prioritization The Kitsap Business Forum events are free, and those planning to attend are asked to RSVP at KitsapBusinessForum.com. The forum will be held from 7:30-9 a.m. in the third-floor meeting room at Kitsap Conference Center in Bremerton. Parking is free for the event.

Brown Bear closing Chevrons on SR 305 Drivers will have two fewer fuel options along State Route 305 this spring.

Brown Bear Car Wash of Seattle plans to shut down two Chevron stations on the highway in the next six weeks.

Its location off Hostmark Street in Poulsbo was scheduled to close Feb. 26. The Chevron off Hildebrand Lane on Bainbridge Island will close March 31, according to Brown Bear regional manager Larae Giuseffi.

Giuseffi declined to discuss the reason behind the closures.

Brown Bear also owns a station at Highway 305 and High School Road, across the street from its Hildebrand loca-

tion. Giuseffi said the company will keep that station open.

The closure of Brown Bear’s Hildebrand location will leave Bainbridge with two gas stations (a 76 station operates in Island Center).

Fuel stations on the island and in Poulsbo compete with tribal-owned stations in Suquamish, which work under a different taxing agreement than private sellers and can generally offer cheaper prices.

A Safeway store and gas station opened near Highway 305 and Lincoln Road last June, adding 10 pumps to the thoroughfare.

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technology | charles keating

Net neutrality debate part of new evolution of the Internet

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ince last May when I covered this topic, much has transpired. On its face, net neutrality is about whether carriers can prioritize traffic or charge premiums for faster service, but it’s also about competition in broadband and the future of the Internet.

The most recent dustup came when cable firms, which operate most of the broadband connections to end users, wanted to charge video providers for “excess” bandwidth. End users already pay for Internet connections, usually at a fixed price with terms of service assuming most of the time the pipes are not fully utilized. As more people stream video and use cloud services, total bandwidth needs are increasing and providers wanted to recoup costs to upgrade their networks to handle the digital traffic jams.

The prospect of paying extra for fast Internet lanes — controlled by a few firms and presumably affordable only to established major providers — was anathema to the vast majority of users and raised the specter of a slippery slope. Which services would be prioritized or discriminated against? The FCC accepted the practice in principle on a case-by-case basis and held out the consideration of regulating Internet services under Title II of the Telecommunications Act if abuses were perceived. That decision was up for ruling on Feb. 28, so by the time you read this we will be likely be moving into new waters. The issue matters not just to pro-

viders and carriers, but also to entrepreneurs creating new cloud products, governments, open Internet advocates and everyone between.

The history of our telecommunications networks, the Internet and how things have evolved provides background on how this came to be. Prior to the breakup of AT&T (or Ma Bell), there was only one provider of telecommunications services in the U.S. You rented your phone and calling was expensive, especially long-distance and even more for overseas. Taxes were a source of revenue for governments, and fees such as the universal service fund (USF) were used to extend this network to rural users. With development of fiber optics in the 1970s, new networks were developed that could carry vast quantities of all types data.

While the United States undeniably had the best analog communications network in the world, over time countries starting with later-generation technologies would leapfrog ahead. Greater innovation and competition were needed, and the breakup of the phone monopoly spun off hundreds of companies offering competition in services, often over the same legacy connections to end users. It was messy but it worked and prices fell. At the same time cable TV, mobile and satellite networks developed and then early Internet came to households via dial-up modems.

As non-critical “information services,” cable TV and Internet were deemed less critical infrastructure than the regulated phone services that connected users to 9-1-1. The efficient, packet-switched Inter-

PeoPle in business Kitsap Bank picks two for employee awards Kitsap Bank announced that Marni White, branch manager at the Pioneer Way branch in Gig Harbor, has been named the bank’s 2014 Volunteer of the Year.

Volunteering nearly 250 hours throughout the year, White is committed to making a difference in the community.

She joined Kitsap Bank Marni White in 2011 and has been the Pioneer branch manager since December 2013. She is an active member in the Rotary Club of Gig Harbor-North and The Gig Harbor Chamber, along with helping out with numerous fundraising events and activities.

“Marni has done a tremendous job giving back,” Kitsap Bank CEO Steve Poli-

takis said. “Her dedication, commitment and capacity to contribute not only makes Marni a great asset to Kitsap Bank, but also to her community.”

Kitsap Bank also named Jackie Smith, who works at the South Park Village Branch in Port Orchard, as named Employee of the Quarter for the fourth quarter of 2014.

Smith joined Kitsap Bank in March 2011 as a client service representative at the West Bremerton Branch, and was promoted last year to her current Jackie Smith position as a financial service specialist. She was selected for this award for her leadership example in representing Kitsap Bank at bank-sponsored events, her contributions to the Social Media committee, and for going above and beyond in assisting her clients and supporting her co-workers.

net quickly grew and as millions of users went online, it quickly morphed into the common universal network. Regulators could have changed the classification of the Internet then to reflect its growing importance, but not wanting to cause harm or add taxes to this new, rapidly innovating market, regulators deliberately took a wait-and-see approach. Broadband, once defined as 200Kbps when most users were on dial-up modems, was in January updated to 25 Mbps downstream and 4 Mbps upstream bandwidth. The new standard reflects growing uses, and while nearly 80 percent of homes can receive this level of service, a significant portion cannot and more importantly, most have only a single Internet provider choice at this speed and therefore lack true competition.

Worldwide the importance of broadband is recognized, and other countries have approached broadband with national goals to lower costs and promote deployment. There have been many approaches; some leverage competition and many have provided faster speeds at lower prices. Partly this is due to our having a legacy infrastructure that served us well for many years, but the future is a combination of fiber and high-capacity wireless and mobile networks.

Given the nearly universal reliance on the Internet, its current classification as a non-essential information service is truly at odds with its current application. The reclassification seems likely and would be on par with regulation in other countries. Like analog TV signals before them,

the legacy last-mile network is being supplanted by cable and fiber networks, and regulations preserving the remnants of the old network need to be replaced. Already 40 percent of homes have already dropped their legacy landline phones in favor of VoIP services or mobile phones.

Similarly, more “cord-cutting” users are dropping cable and satellite TV packages in favor of unbundled Internet or relying on mobile connections, with the effect of driving cable companies to seek consolidation to negotiate with content providers, raising monopoly concerns over the last-mile connections.

As online cloud-only networks grow and compete with the established networks, and the Internet of things moves from concept to reality, all these innovations require low-cost, reliable and secure broadband access to end users. Reclassification does not necessarily mean taxes will immediately soar and innovation die, but it is likely regulators want to move forward with a light touch and will seek ways to promote competition. We are ready to enter a new evolution of the Internet.

• Charles Keating is president of Keating Consulting Service, Inc. (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.com), and current president and co-founding member of West Sound Technology Association (www.westsoundtechnology.org).

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business openings

Hudson Motors expanding onto more of Poulsbo site

By Tim Kelly KPBJ editor More pieces are fitting into place at the former Courtesy Auto Group site on Poulsbo’s Viking Avenue.

Hudson Motors is expanding its used car lot that opened last year when owner Darren Hudson bought an acre on the south end of the property for his business, which also includes two lots in Bremerton.

The Morgan family that owns American Building and Roofing recently purchased the last available section of the Viking Avenue complex, a 3.4-acre parcel that includes the 40,000-square-foot building that was Courtesy Ford’s showroom and service building.

Hudson Motors is leasing about half the showroom/service building and part of the lot adjacent to its current space.

That will allow the business to start offering auto repair and maintenance service, something it has not had the space for at its Bremerton or Poulsbo locations.

“It’ll take us a few months to get that part going,” Darren Hudson said, because they’ll have to bring in all the needed equipment for the service bays.

“It’s a big jump, but it makes sense to do it,” he added. “It’ll be good for us, and good for the community.”

Hudson said he’ll hire a service manager and several technicians to launch the service operation.

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in 1999, didn’t see this coming. When he bought out company founder Pete DeBoer a couple years ago, he brought in another partner who did IT work.

“We decided we needed to go back and really diversify more,” Petersen said. “The printer now is a computer. So it seems like (expanding into IT services) was a natural extension of what we were doing.”

Olympic began offering a “Flex IT” program, an option that allows businesses to pay for a set number of hours of computer service each month, which can be used when needed. That gives customers the flexibility of utilizing whatever kind of service they need, Petersen said, whether it’s computer repairs or system upgrades.

While the standard charge for regular computer work is $75 an hour, on the Flex

The sales side in Poulsbo will expand right away.

“We want to have the new sales office open and cars on the upper lot by March 1,” he said, and he’s hired a general sales manager, a position he’s always handled himself.

Hudson already has moved all the cars

IT plan it’s $55, and $50 for customers who sign up for autopay.

“We’re also hoping that by switching to providing IT services, we’ll get more customers that need printer cartridges,” Petersen said.

The company also has resumed the service of picking up electronic waste for recycling.

“There are numerous electronic items that are not covered by the Washington State free E-Cycle program,” said Erik Petersen, Jeff’s son who is vice president of operations at Olympic Technology Resources.

The company charges a nominal fee for picking up these items for processing.

“We are firm in our commitment to being a green sustainable business,” Erik Petersen said.

Hudson plans to repurpose the empty Callow site eventually, by building up an inventory there of trade-in vehicles they get that are older and less expensive than the range of used cars at the Poulsbo lot.

Another part of the expansion will be adding RVs and travel trailers, a market segment that Hudson said is picking up again as the recovery from the recession continues.

American Building and Roofing, a building supplies wholesaler with seven Washington stores, will move its Poulsbo operation to the former car dealership site over the next few months. Property manager Dave Pruitte said ABR will use Hudson Auto Center opened a lot the back section of the main in Poulsbo (above) last year on part building for warehouse space of the former Courtesy Auto Group and will store additional roofsite on Viking Avenue. Owner ing and building materials on Darren Hudson is expanding the back of the lot. his operation onto the upper lot Pruitte said that still leaves and will take over part of the approximately 15,000 square former Courtesy showroom (left) feet of space that will be leased and service facility. Hudson is in the building. leasing the additional space from “We’re in the process of talkAmerican Building & Roofing, ing to a number of potenwhich recently bought the 3.4-acre tial tenants right now, and we parcel that includes the buildings. hope to have that done in the ABR plans to move its wholesale next two or three weeks,” he building supplies business to the said. site later this year.

He said a hair salon is interfrom his Calested in the main floor space, low Avenue lot in Bremerton to the largand that the upstairs spaces are suitable er Poulsbo site, but he said his other for medical or professional offices. AnyBremerton lot on Loxie Eagans Boulevard one interested in leasing information will continue to operate. should call Pruitte at 360-710-7996.

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business strategy | dan weedin

Fifty shades of cheeseburgers

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heeseburgers get a bum rap in my estimation. They are easily viewed as being common, ordinary, or one shade. Too many people have a frame of reference of a thin patty with a feeble excuse for cheese pressed between two pale, uninteresting buns. No foreplay here.

I can still hear the late John Belushi screaming out “Cheeseburger, cheeseburger, cheeseburger ... Pepsi no Coke,” on the famous “Saturday Night Live” skit of the 1970s. I would argue that there are more shades of cheeseburgers than meet the eye.

There may be some that will titillate your senses. If you venture outside of a fast-food joint, you may just be blissfully surprised.

Cheeseburgers can be unique based on the cheese. The 99-cent option at the drive-thru window is undoubtedly offering some faux cheese “product.” I’ve dined at many a restaurant (some pretty hole-in-the-wall hangouts) where the cheese is cool and classy — be it bleu, Muenster, cheddar, Swiss,

or my personal favorite, pepperjack.

The buns are always important (just as in the movie I am parodying, I’m sure). Instead of some flimsy white processed bread that probably came out of a plastic wrapper, consider your delight in nibbling on a Kaiser, sourdough, multi-grain, artisan roll, or even glutenfree!

Heck, I even add some bourbon and honey to my cheeseburgers to pump up the taste. Alcohol always helps in setting the mood, don’t you think?

Hungry yet?

Here’s the deal. Cheeseburgers can seem ordinary and uninspiring to people unless they are dressed up a little bit. So can you and your business. If you don’t dress up your value to others (be it for individuals or companies), then you’ll be as unappealing as that fast-food cheeseburger for 99 cents.

Here’s how you add some pizzazz to your brand and business…

Become an object of interest by being well read and well versed in the issues surrounding business. That means reading the national and local papers for insight into what’s happening in the world.

You don’t need to be an ex-

pert, but you do need to be conversational. The more you know about the world you live in and how it affects others (namely your clients and potential clients), the more attractive you will be to them.

Improve your vocabulary and delivery of your message to incite emotion, rather than logic. Emotion makes people move and take action; logic merely makes people think.

Thinking can often lead to wasted time and opportunity. Being influential in the end is good for your clients and good for you.

You are influential when you can deliver an honest, straightforward and value-laden message in your marketing and personal communication. For a second consider movie titles.

How important are they to even get you to read the review or watch the trailer? How enticing are your “titles?”

Develop singular and exclusive intellectual property that jumps out at people like a sizzling bacon cheeseburger coming off the grill. Intellectual property is the manifestation of your expertise, experience, opinions and smarts. It’s delivered through books, columns, articles, speeches, webinars, workshops, podcasts, videos and visu-

al processes scribbled on the back of cocktail napkins. The more of an intellectual property empire you build, the more alluring you become.

Get away from your computer and interact with people. You will learn how to best help them and that will make you valuable.

I’ve observed that an increasing number of business leaders and professionals are defaulting to technology, rather than “old school” face-to-face communications. People are hired, fired, promoted, prospected and communicated with through text and email. While these platforms have their uses, they should be more about information, not relationships. If you want to stand out in a crowd, maybe you should get up on the shoulders of the masses so you can be seen.

Final thought: Not only does straying from looking and tasting like an ordinary cheeseburger work for your individual success, it also helps you recruit and hire interesting and talented people.

That’s similar to adding a little bourbon and honey to your cheeseburger mix ... it keeps everyone coming back for more. Talented people have more opportunities than ever before to seek jobs and careers that interest and inspire them. Plain old cheeseburger companies might be like working at the drive-thru window

letter to the editor Museums, local cultural organizations in need To the Editor: What does it take to make a strong community? And how can you help make a difference?

Did you know that communities with vibrant cultural organizations are more competitive for high-paying jobs and high-quality workers, and enjoy greater economic prosperity?

Kitsap is hopefully poised on the verge of emerging out of the economic doldrums. Hopefully that improved prosperity will include our cultural organizations as well.

Studies have shown that students who are engaged in cultural activities excel in school and are more comfortable working in diverse com-

munities. Science, heritage and arts experiences help advance education and enhance the economy, as well as enrich our quality of life.

Yet here in Bremerton we are faced with a serious dilemma of having a number of important cultural resources such as the Puget Sound Naval Shipyard Museum, the Kitsap Historical Society Museum, the Valentinetti Puppet Museum, the theater and music organizations and others that are struggling to pay their expenses and rent. These organizations are important to the business, cultural and educational life of the entire county and West Sound, not just the city of Bremerton.

Little public attention has been paid to the fact that Bremerton has a huge low-income population, unlike the rest of the county. This is especially

noticeable in the statistics of the free and reduced-fee meal program in the Bremerton School District, where approximately 65 percent participate in the program. Some individual schools reach as high as 80 percent.

Are we to assume that Bremerton school children and families are not worthy of having access to these facilities and that these facilities are therefore expendable to the overall economic and cultural future of the county? I would hope not. Hopefully there are civic-minded individuals and organizations that are willing to lend their support and expertise to ensure their futures as an important part of Kitsap’s vision.

—Stanley W. Hess, museum curator Valentinetti Puppet Museum, Bremerton

when the skill sets more mirror the boardroom.

Get that burger out of its dingy little cardboard box and onto a snazzy colored dish with steak fries on the side. The more compelling you are to smart people, the more smart people you will bring in to your organization and that always is a recipe for prosperity.

Why don’t you try adding a few shades to your business and your burgers? Start slow, but start.

Stop worrying about what others might think be-

cause waiting will lose you time and opportunity like was stated earlier. The results you gain may just be highly stimulating!

• 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. You can reach him at 360-697-1058; email at dan@danweedin. com or visit his website at www.DanWeedin.com.

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regional economy | john powers

Confluence of attributes creates economic future From the strategic confluence of four primary community attributes (population, land use, transportation and commerce) springs a community’s economic future.

Last October I wrote about how communities across Kitsap are in the process of shaping Kitsap’s economic future as they update their longrange comprehensive plans (www.kitsapsun.com/kpbj/areas-compplan-udates). I talked about the purpose of community comprehensive planning in order to anticipate and effectively manage growth; and, how to assess, align and aim community resources at a targeted future.

I also shared my perspective on the importance of garnering meaningful input from all the various community stakeholders; in particular, the business community as ongoing investors in our collective economic future. Over the past six months, a great deal has already occurred in the process of updating our comprehensive plans, and much more will follow in the next fifteen.

Last fall our Alliance provided market data regarding our local economy at a series of town-hall meetings hosted by the county throughout Kitsap. In October our Decision Makers II event focused on the economic development aspects of projected growth in the unincorporated urban growth area of Silverdale. At our December board meeting in Port Orchard, we

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“I wish them all the success,” he said.

“I would love to see that market actually make it.”

As for Ryan, he remains enthused about the market venture, and prospects for future development downtown. Ryan said after the recent news of Tommy C’s having to move out of its site off Bethel Road, he talked to owner Tommy Cash about relocating his restaurant and bar into the Myhre’s building.

That wasn’t feasible, but Ryan said he and Samadpour are looking for a tenant there and plan to improve the building’s exterior appearance. That includes connecting the roof of Myhre’s to the market building to cover the vacant lot in between, which Ryan said could allow for a possible expansion of the market.

“The thing is, what I will give Don, he is a dreamer,” Brozovic said. “And he is a guy that can look at something and go … what can I do here?”

Brozovic is back on his feet again, and has returned to doing consulting work.

He’s actually working on a project being built in Everett, a six-story apartment/retail/farmers market development called Potala Market Place that’s similar to what Samadpour would like to develop in Port Orchard.

The future in Port Orchard may or may not include condo developments that change the physical landscape. It’s unknown whether Ryan can recruit other small businesses to fill the current market vacancies. And the question remains on whether a marketing effort to attract wider interest can be implemented as the market’s second tourist season draws near.

But according to Ryan, ever the pitchman for business ideas, the viability for his project beyond its challenging first year depends on community support.

“If the local community doesn’t feel like this is a good enough attraction for them to come to, “ Ryan said, “we’re not going to get enough support to keep it alive.”

zoning change that would allow buildings of that height along Bay Street.

“What he really wants to see,” Ryan said, “is he wants the market to succeed, he wants the retail to succeed — he wants the first one to two levels of every building to be retail. And maybe a level of professional (offices), and the rest of them adult-living condos.

“People who want to be in a downtown core, who want to be near the marinas, who want to have views, and have the money to do it. And those are the people who are going to support the market.”

Will the market make it?

Brozovic said he suggested ways to generate more sales at Bay Street Meat Co., such as adding a smoker at the shop, doing barbecue outside in the vacant lot next to the market and setting up an offsite game processing operation. But nothing came of the ideas.

Ryan said city codes won’t allow a smoker in the market, though he recently spent almost $10,000 on “a custom-built smoker/ rotisserie/grill, on a custom-made trailer,” which will be used off-site since there’s currently not space for it at the market.

It could be used as part of Hogfest, a barbecue cook-off that Ryan envisions as a countywide event and a big promotion for the market in 2015.

Weekend special events held in recent months to draw people to the market have been organized by Katie King, who’s part of the family-run seafood business. One event was a chowder cook-off that Northwest Seafood & Wine planned to host in February, but it was canceled.

The seafood shop owners would not comment on the status of their business or whether they plan to stay at the market, but some of the smaller vendors remain optimistic that the market can thrive.

Though he’s no longer part of it, Brozovic hopes that will happen.

captured valuable input from many of the largest private-sector employers in Kitsap as to their future needs involving transportation, infrastructure, workforce, zoning and building permits, and maintaining an overall vibrant business climate.

And, at our Alliance’s annual economic forecast conference in January, we conducted a web-based “instant survey” in which scores of attendees provided direct and instantaneous input on a variety of questions pertaining to planning for Kit-

sap’s economic future.

This survey yielded some predictable and not-so-predictable responses. The majority of respondents deemed the overall business climate in Kitsap as average to good (less than 5 percent ranked it as poor). Most employers anticipated growing and hiring more FTE’s this year — matching the overall perception that Kitsap’s economy is growing. And when it came to identifying priorities in advancing business opportunities, one out of three identified “skilled workforce” as their top priority.

On the not-so-predictable inputs, the following selections surprised many as they gleaned the immediate inputs: technology see future | 38

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car review | 2015 fOrD fusiOn

Sedan’s Titanium version offers midsize luxury, European-inspired design

By Lary Coppola For KPBJ

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he 2015 Ford Fusion, like everything else in this market segment, is your basic five-passenger, fourdoor midsize sedan. And just as the jelly bean-shaped Ford Taurus redefined basic sedan design upon its debut in 1985, the Ford Fusion has redefined the modern midsize family sedan.

Debuting in 2005 as a 2006 model, the Fusion was restyled for the 2010 model year and again for 2013. Except for the inevitable evolutionary upgrades, the 2015 Fusion remains relatively unchanged, while offering attractive styling, a variety of sophisticated electronic audio and communication choices, and a sporty character more often associated with German sport sedans than Detroit iron.

We had the opportunity to drive the topof-the-line, all-wheel-drive 2015 Titanium model of this attractive sedan while on a recent jaunt to South Florida. While the Fusion’s eye-pleasing sleek lines and wide range of available powertrains — including gas, hybrid, and plug-in — make it appealing to a variety of buyers, this review will focus primarily on the Titanium version.

Walkaround: The exterior of the 2015 Fusion is basically unchanged, but is still very striking, combining German-type luxury styling with wraparound headlights and aggressive front-end design cues obviously influenced by Aston Martin — which was once part of Ford. While the Fusion is classified as midsize, it looks, feels and drives larger, although its overall measureF U T U r e | F rom 37

should be a top priority for expansion in the coming year; demand for technical certificates trumps bachelor’s degrees ... but not by much; commuting times are critically important to employees; and, broadband telecommunication infrastructure is as important to our economy as roads.

A complete report on the “Instant Survey” results can be found on our website: kitsapeda.org/2015/02/2015-economicforecast/ — or link via our main website at www.kitsapeda.org .

KEDA intends to continue to use this “instant survey” tool to assist us and our public partners as we work together to plan for our economic future. Please contact us if your organization or business is interested in participating in this unique opportunity.

We will continue the communities comp plan conversation (with a focus on trans-

ments very closely mirror those of the Honda Accord and Nissan Altima.

The styling changes for 2015 are minimal — new original wheel designs, and four new exterior colors — Bronze Fire Tinted Clearcoat Metallic, Guard, Tectonic, and Magnetic.

Interior: The Fusion Titanium comes standard with leather upholstery, leather-wrapped steering wheel, heated front sport seats, dual-zone automatic climate control, keyless ignition/entry, pushbutton start, aluminum pedals, auto-dimming mirrors, rear parking sensors, rearview camera, a 12-speaker Sony audio system with HD radio, a sport-tuned suspension and 18-inch wheels.

Our test model included the all-new Terracotta package, which is only available on the 2015 Fusion SE and Titanium models. It features Terracotta-colored leathertrimmed seats and door inserts. Our test vehicle also featured the standard 10-way driver’s seat with memory, and 4-way passenger seat, as well as the optional heated and cooled versions of those seats.

The rear seats are comfortable, with adequate leg, knee and headroom for passengers up to about 6 feet tall. The adjustable headrests are comfortable for passengers, but can interfere with rear visibility.

Instrumentation is modern and attractive, with an illuminated blue needle on the speedometer. An optional dual LCD display allows drivers to toggle through a variety of functions. One cool feature is the overhead interior lighting, which you work with the swipe of your finger.

The steering wheel is home to buttons portation) at KEDA’s annual meeting on March 19 at the Kitsap Conference Center. The meeting is open to the public, with registration at www.kitsapeda.org.

You may also continue to follow the comp plan update process by logging onto local government websites for a list of meetings and other ways you can participate in sharing your thoughts and ideas about Kitsap’s future. Here’s the list: www.compplan.kitsapgov.com www.planning@cityofportorchard.us w w w.ci.bremerton.wa.us/compplan / doc/schedule.pdf www.cityofpoulsbo.com/planning www.ci.bainbridge.gov/615/navigatebainbridge Planning together, growing together, prospering together — for generations.

On Kitsap!

• John Powers is executive director of the Kitsap Economic Development Alliance.

2015 Ford Fusion controlling audio input and volume, cruise control, hands-free phone operation, vehicle information and settings, and voice activation.

Technology includes Ford’s Sync voice recognition and the MyFord Touch interface. Like most Microsoft products, both have their idiosyncrasies and can be frustrating at best, however, there have been recent improvements — and unlike the last Fusion we drove, we experienced no problems using the system.

Safety features on all Fusion models include front seat side airbags, front knee airbags and side curtain airbags, anti-lock disc brakes, traction control, electronic stability control.

Optional technology included on our test model were blind-spot monitoring, cross-traffic alert, lane departure warning, lane-keeping assist, rearview camera and inflatable rear seatbelts. Advanced optional safety features include adaptive cruise control, blind-spot detection, lanekeeping assist, and the Active Park Assist option, which automatically measures and maneuvers the Fusion into a paral-

lel parking space — a feature normally reserved for higher-end luxury cars.

The Fusion offers 16 cubic feet of cargo space — slightly more than its Camry and Altima competitors, which each offer 15.4 cubic feet, while the Accord measures 15.8.

Under The Hood: The Fusion Titanium is available with front-wheel drive or allwheel drive, which is how our test model was equipped. It’s powered by a turbocharged, DOHC 2.0-liter EcoBoost inline four-banger, that puts 240 ponies to the pavement, with 270 lb. ft. of torque. The aluminum block powerplant boasts four valves per cylinder and twin independent variable camshaft timing. It’s married to a smooth 6-speed automatic transmission that shifts in all the right places, and features paddle shifters. EPA fuel mileage ratings are 22/city, 31/highway for a combined 25 mpg.

Behind The Wheel: As noted earlier, the 2015 Fusion feels and drives larger than it is. While it doesn’t feel as nimble as some European and Asian midsize see FUsIon | 39

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car review | 2015 vw Golf

Volkswagen Golf-R: A wolf in sheep’s clothing

By Lary Coppola KPBJ contributor

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here’s more than one reason the 2015 VW Golf is the North American Car of the Year — not to mention earning a few other honors as well since its debut late in 2014. The seventh generation of the most successful European car of all time was completely redesigned for 2015, and the Volkswagen Golf lineup has become one of the most extensive vehicle families of compact hatchbacks, featuring both three and five-door body styles and multiple powertrain combinations.

I’ve had occasion to drive them all — including the all-electric eGolf, as well as the diesel version — which were showcased at a recent press event. I drove another version in my regular weekly rotation, and yet another as a courtesy loan during a personal business trip to Atlanta.

The 2015 Golf lineup features the gasoline-powered Golf TSI and energetic GTI models, in two, and four-door hatchback configurations. Also available is the fourdoor, diesel-powered Golf TDI, and the aforementioned all-electric e-Golf. Also, VW just recently debuted the roomy 2015 Golf SportWagen. It seems there’s a Golf for just about every driver’s needs — except the hot rodder. Until now… Enter the high-performance Golf R, which is a rocket, pure and simple.

The only hatchback competition for the 2015 Golf R is its more expensive colleague, the Audi S3. However, look for a new, hotter Ford Focus in the 2016 model year.

Safety equipment on all Golf models includes dual front airbags, front seat-mounted side impact airbags, side air curtain airbags, antilock brakes, electronic brakeforce distribution, brake assist, electronic stability control and hill-hold assist.

Walkaround: The Golf is VW’s first use of its versatile MQB platform in the U.S.

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sports sedans, it accelerates much quicker than you expect a four-banger to in a car this size. Driving from Fort Lauderdale to Lake Okeechobee, and then back through Palm Beach, the Fusion proved to handle solidly, with a quiet, comfortable ride, strong braking, and steering that fit our driving style pretty well.

Since Florida is so flat, there were no hills to conquer, but the Fusion acquitted itself well over a variety of road surfaces on the winding two-lane blacktop around the massive lake, as well as on the freeways. On the all but deserted four-lane Highway 27, between what used to be Andytown and South Bay, we had difficulty

The evolutionary styling leaves it easily identifiable as a Golf, in spite of a slightly longer wheelbase, longer hood with short overhangs, a wider track and lower roof than the previous model. The Golf’s familiar shape is crisper yet more rounded, and aggressive looking.

The distinctions between the rest of the Golf lineup and the R are subtle, with the most noticeable being black finish side mirror backs, four tailpipes, and R logos on the front fenders. The most significant change is the front fascia, which features standard Bi-Xenon headlights with U-shaped LEDs flowing into a slimmer grille with larger air intakes. LED running lights are standard, as are 18-inch, Rspecific design alloy wheels, with 19-inchers optional.

Interior: While all 2015 Golf models get comfortable seats, a stylish interior with thoughtfully placed controls, plus a new standard color touchscreen and plenty of space for people and cargo — the Golf R features heated leather seating surfaces, power driver’s seat, and automatic climate controls as standard equipment.

Controls are angled slightly toward the driver, and the instrumentation features classic, easy to read, white-on-black numbering. An information screen sits between the tach and odometer and allows drivers to easily see various functions by toggling a steering wheel-mounted control.

A premium audio system by Fender — of guitar fame — is optional. All 2015 VW Golf models come standard with iPhone connectivity using Apple’s newest Lightning plug. With our iPhone 6 plugged in, we were disappointed the phone’s navigation audio commands didn’t come through the car’s speakers, as they do with Nissan, Hyundai, and most luxury brands. However, the Golf’s built-in navigation works just fine.

There’s ample headroom and adult-sized legroom front and back. Cargo space mea-

keeping it under 85 — because of the quiet, comfortable ride, it just didn’t feel we were moving that fast. On I-95, where the 70 mph speed limit is a mere suggestion, keeping up with high-speed traffic was effortless.

Whines: Making a U-turn requires plenty of space — but less than a Honda Accord.

Bottom Line: In a segment cluttered with choices, the sleek, eye-catching, European-inspired design and surprisingly potent powertrain make the 2015 Ford Fusion Titanium an attractive choice that makes a bold fashion statement. At $39,125 as tested, it’s a good value for this segment as well.

2015 Volkswagen Golf sures 22.8 cubic feet, and the Golf’s boxier shape allows stuff to be stacked nearly all the way to the roof.

Under The Hood: The Golf R features a 2.0-liter turbocharged, direct injection TSI 4-cylinder powerplant. It boasts variable valve timing with two-stage exhaust valve lift, and delivers 292 horses and 280 lb.-ft. of torque — 36 more horses, and 37 lb.-ft. more torque than the previous R model. It’s EPA rated at 23/30 mpg City/Highway — an improvement of three miles per gallon over the previous-generation Golf R, which originally debuted as a 2012 model.

The engine is married to either a 6-speed manual or VW’s DSG automatic transmission. All Wheel Drive is standard.

Behind The Wheel: Simply put, the Golf R is a blast to drive. VW says it does the 0-60 drill in 4.9 seconds, but it feels faster than that. Our test drive took us from Pacific Beach just north of San Diego, across the hills to Julian and back. The route featured a lot of winding, hilly, 2-lane blacktop, and in the R, it was an E-Ticket ride.

Handling on the Golf R is tight and certain, thanks to all-wheel drive, lightning shifts — up and down — delivered by the DSG paddle shifters, and the DCC option package, which includes a sophisticated adaptive damping system, bigger brakes, 19-inch wheels, more aggressive tires, and

navigation. We easily handled corners marked 35 at double that speed. Side bolsters in the comfortable front seats held us firmly in place around those corners while the firmer suspension all but eliminates body roll, inspiring driver confidence. Braking is formidable and we never experienced a hint of fade, no matter how hard or often we hit them.

Volkswagen says the Golf R is the fastest car it’s ever brought to the U.S. After a day behind the wheel of this missile, we don’t doubt it. Top speed is limited to 155 mph, and while hitting three digits a number of times, we didn’t get near that, but felt like we could — and pretty quick.

Whines: For some reason, Volkswagen has declined to put a USB port in the Golf, but the iPhone connection does fit the latest version. If you like your music loud, the optional Fender system delivers, but at low to moderate volumes leaves something to be desired.

Bottom Line: The new 2015 Volkswagen Golf R is sophisticated machinery with European road manners. The fact this car is so much fun to drive — and yet still affordable at just over $39,000 — is perhaps its best quality of all.

• For more vehicle reviews, visit www. autoreviewers.com.

40 |MARCH 2015

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