Kitsap Peninsula Business Journal March Edition

Kitsap Peninsula

Business Journal An edition of the Kitsap Sun

KPBJ.COM

March 2016 | Vol. 29, No. 3

Offering a payoff in pizza Investors in chef’s crowdfunding campaign will get tasty reward Page 8 Banks that have extended their operations into Kitsap region | 4 Socially responsible investing | 7

Kitsap Sun 545 Fifth Street Bremerton, WA 98337

Kent, WA PERMIT No. 71

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| March 2016 |

WELCOME | DAVID NELSON

Never know what comes next

On the Cover Brandon McGill will open Bruciato pizza restaurant this summer in a vacant Winslow Way building that’s being remodeled. To help launch Bruciato, the Bainbridge Island chef is offering a special crowdfunding deal to community investors. | Story, page 4

I

Steve Zugschwerdt photo

Crowdfunded celebration of beer Propolis Brewery recently opened a new brewing facility and public taproom, an expansion made possible in part by an online fundraising campaign. Story, page 8

Kitsap Peninsula

3

Business Journal KPBJ.COM

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.

David Nelson, Editorial Director david.nelson@kitsapsun.com Tim Kelly, Managing Editor tim.kelly@kitsapsun.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 360792-5247 or hugh.hirata@kitsapsun.com.

To advertise in the Kitsap Peninsula Business Journal, contact Michael Stevens at 360-792-3350.

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 © 2016 Kitsap Peninsula Business Journal / Kitsap Sun

Investing guided by values Some investors prefer to work with financial advisors who can help them make sure their portfolio includes socially responsible funds and companies. Story, page 7

The business of beans A Bainbridge Island man is ramping up his coffee roasting to launch a business as a wholesaler. Story, page 6

t’s pure coincidence that an edition focused on finance comes during the month when our company may become part of a larger newspaper corporation thanks to a large amount of money. The vote by Journal Media Company shareholders has not been held of this writing, but if they grant approval later this month the Kitsap Sun and the Kitsap Peninsula Business Journal will become part of the Gannett Company, publisher of USA Today and papers in nearly 100 U.S. markets, for a price that tops $280 million for newspapers and websites in 14 markets overall.

It’s a considerable change, and if this all sounds familiar it should — in 2014 I was writing about our move from the E.W. Scripps Co. to a new company, Journal Media. After nearly 80 years as more or less a holding of the Scripps family, in one form or another (and there were several), we’ve been through a few ownership changes.

What the acquisition means to us as a local entity is not yet clear. Gannett and USA Today, by extension, are an existing nationwide brand and certainly will bring a scope of resources and partnerships we’ve never known. In a world where digital news can scale across the country quickly, that may be an advantage, and if you’ve got 100 newspapers working together there’s bound to be some helpful lessons to be shared.

The other side of the coin is the concern over our local autonomy, a feeling employees have anytime a smaller business becomes part of one that’s larger. It’s a point of pride that editorial decisions for the Business Journal and the Sun are local, and our connection with the community comes through knowing the faces of our reporters, editors and advertising reps rather than a logo. It may go without saying that folks in our office feel some uncertainty, and I’m not too proud to admit feeling some anxiety of my own.

What I do know is that soon after this acquisition, if approved, we’ll celebrate another milestone — the second anniversary of the Business Journal becoming part of the Sun’s family. I’m proud of the strides we’ve made during that time, from the addition of glossy covers to our significant digital growth on www.kpbj.com to the success of revamped events like the 20 Under 40 awards each November. And I’ll always brag about the quality of business coverage you mind in this publication each month. We’re again offer the same with this month’s look at small See NEXT, 4

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| March 2016 |

Kitsap seen as good market for expansion-minded banks

By Tad Sooter tad.sooter@kitsapsun.com 360-475-3783

First Federal Savings & Loan executives knew they’d be the new kids on Kitsap’s banking block when they opened a Silverdale branch two years ago.

“It was a risk moving into a market with competitors like Kitsap Bank,” First Federal chief banking officer Kelly Liske said.

Liske said the Port Angeles-based bank emphasized user-friendly banking technology to make its Bucklin Hill Road branch stand out on the peninsula. The Kitsap location exceeded expectations, accruing more than $20 million in deposits in its first year.

“We’re continuing to grow every day,” she said.

First Federal was one of four banks to enter the Kitsap County market in the past three years. The three others expanded to the county through acquisitions.

Oregon-based Umpqua Bank acquired a Bainbridge Island branch and a Silverdale loan center after merging with Spokane’s Sterling Bank in 2014.

Umpqua was already a familiar name on the peninsula, with three offices in Gig Harbor.

HomeStreet Bank of Seattle also gained a foothold on Bainbridge in 2014 when it bought AmericanWest Bank’s island branch (formerly home to Viking Bank). Banner Bank gobbled up the rest of AmericanWest last year, acquiring a Poulsbo branch in the process.

Three banks — Heritage, Opus and U.S. — have established Gig Harbor branches since 2011, according to the Federal Deposit Insurance Corp.

For First Federal, which became a publicly traded corporation last year, expansion into Kitsap marked the start of a new growth strategy.

The bank was founded more than 90 years ago but the Silverdale location was its first branch outside the Olympic Peninsula.

Liske said First Federal executives knew they needed to tap into new markets to grow. Extensive research pointed to the east side of Hood Canal as a good place to start.

“Silverdale was a good fit,” Liske

LARRY STEAGALL

The First Federal Bank in Silverdale that opened in 2014 was the Port Angeles-based company’s first branch outside the Olympic Peninsula.

Kitsap’s newcomers Banner Bank Opened in Kitsap: 2015 Local offices: 18960 Hwy. 305, Poulsbo HQ: Walla Walla Total assets: $9.52 billion HomeStreet Bank

SILVERDALE WAS a good fit. A growing market that made sense.”

— Kelly Liske, chief banking officer at First Federal

Opened in Kitsap: 2014 Local offices: 921 Hildebrand Lane, Bainbridge Island; 3212 NW Byron Street, Silverdale (home loan center) HQ: Seattle Total assets: $4.87 billion Umpqua Bank Opened in Kitsap: 2014 Local offices: 600 Winslow Way East, Bainbridge Island; 10049 Kitsap Mall Blvd., Silverdale (home loan center)

Kitsap-area credit unions With number of Kitsap County branches, and total shares/deposits as of Sept. 30, 2015 Kitsap Credit Union (11) $907 million Connection CU (3) $23 million Peninsula CU (2) $149 million BECU (1) $12.2 billion Navy Federal CU (2) $47.8 billion

HQ: Portland, Ore. Total assets: $23.38 billion First Federal Savings & Loan Opened in Kitsap: 2013 Local offices: 3035 NW Bucklin Hill Road, Silverdale HQ: Port Angeles Total assets: $918 million

said. “A growing market that made sense.”

First Federal opened a lending of-

fice in Poulsbo in 2013 before relocating to Silverdale and launching a full-service bank branch a year later.

The Bucklin Hill branch incorporates “interactive teller machines” that serve as regular ATMs and allow customers to connect with tellers via a video link to a First Federal center in Port Angeles. Live assistance is available through the machines 12 hours a day. Eight people also work out of the Silverdale branch.

See BANKS, 13

Next from 3

businessescreativelyfinancingexpansionsplansandthe local banking landscape — with its own shades of acquisition there, as perhaps a good reminder that we’re ours isn’t the first company to merge an asset or branch.

Rest assured that for whatever the change in

ownership brings, one thing it can’t touch is the commitment of folks in our office to our readers and the business community. We appreciate your support, particularly in times like these, and look forward to continuing our evolution as a locally operated business, now with a new corporate logo. Keep watching for what comes next.

| March 2016 |

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Banks, merchants in transition to ‘chip’ cards

■ October was target for adopting fraud prevention technology already widely used outside US

By Rodika Tollefson KPBJ contributor

Over the past few months, consumers have been receiving new credit and debit cards in the mail, as the industry is switching to a new type of cards, called EMV (which stands for EuroPay, MasterCard, Visa, the original developers of the technology).

The new cards, which contain a chip, will no longer be “swiped” the way the old magnetic-stripe cards were — that is, once all merchants replace their point-of-sale terminals.

The Strawhecker Group — a management consulting firm that caters to the electronic payments industry — estimates that only about 37 percent of merchants have migrated as of January. And many banks have yet to issue the cards.

“It’s a long road in the large-scale transition for the (entire) U.S.,” says Rhonda Morris, senior vice president of operations at Liberty Bay Bank, based in Poulsbo. “There are a lot of merchants, so it will take time for them too.”

HOW IT WORKS The EMV card contains an embedded microprocessor chip, which stores and processes the data, generating a cryptogram and digital signature unique to each transaction.

The card itself looks similar to the magneticstripe version (and in most cases still has the stripe, at least for now), but it can be told apart by a silver or gold rectangle — a protective overlay for the chip — close to the upper-right corner. At the new point-ofsale terminals, the card is inserted into a special slot rather than swiped, and stays inserted until the

transaction is complete.

During the transaction, the terminal also prompts the user to either sign the card or enter a personal identification number (PIN), depending on whether it’s a chip-andsignature card (which is what most U.S. banks are issuing for credit cards) or a chip-and-PIN card (used widely in other countries).

“Consumers will have to learn that it’s a little bit different and it takes three to five seconds longer than the swipe card,” says Leah Olson, vice president of marketing at Kitsap Credit Union.

cards in Europe and other parts of the world where EMV is widely used. The Aite Group, an independent

research and advisory firm that specializes in financial services, estimates that fraud losses from coun-

terfeit cards in the United States grew from $1.65 billion in 2011 to $3.61 billion in 2015 — and an estimated 70

million cards were compromised due to data breaches See CHIP, 7

IMPROVED SECURITY

First introduced in France in 1992, the EMV cards have been used in more than 130 countries for many years. According to JP Morgan Chase, there are more than 1 billion chip cards in use around the world.

The problem with magnetic-stripe cards is that they’re easy to counterfeit and criminals have numerous ways of obtaining card data, including through “RAM scraping” malware at POS terminals, cybersecurity data breaches and skimming devices at ATMs. Not only do bad actors have various “tools” at their disposal but they can easily sell the stolen information on the dark web, where an underground economy operates very much like a legit one, with goods and services bought and sold, customer service offered, and like-minded criminals sharing how-to tips.

The U.S. market is an especially appealing target, both because it has the largest number of cards anywhere and because it’s tougher to make counterfeit

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| March 2016 |

Chip from 5

in 2014 alone.

Chip-enabled cards, on the other hand, are more secure in the way they process information through a POS terminal. And unlike the magnetic stripe, the chip cannot be counterfeited.

“The EMV card has a transaction signature for each transaction. So if you steal the data, you’re stealing the data about a single transaction, not about the card itself,” says Ben Knieff, senior analyst for retail banking at Aite Group.

SLOW ADOPTION The United States is one of the few industrialized countries that hasn’t adopted the chip technology — and the last of the G-20 countries (the world’s top 20 economies) to migrate.

The migration started slowly as far as back as 2012. Visa and MasterCard imposed a deadline of Oct. 1, 2015, after which the liability for fraudulent transactions switched to banks and merchants if they didn’t adopt the new technology. (ATMs and fuel stations have later deadlines.)

According to Visa, the number of issued Visa chip cards grew from 180.6 million in October to 212.7 million in December, with chip cards accounting for 72 percent of Visa’s credit volume.

But the mad dash created by the October deadline has led to a backlog, especially for smaller banks.

“Because all the financial institutions in the United States were switching at the same time, it put pressure on the vendors (who produce the cards),” Olson says.

So Kitsap Credit Union, despite planning on the transition for a year, is waiting for its “turn in line,” Olson says — with both debit and cards expected to roll out this summer. Instead of wholesale migration, however, KCU is replacing members’ cards as they expire.

Liberty Bay outsources its credit cards, so those migrated last year. But the bank is waiting for its debit cards to be tested and configured and also hopes to roll them out this summer.

Likewise, Kitsap Bank is in testing mode, with debit cards

to be rolled out in the second quarter and credit cards later on.

“We’re comfortable with our schedule,” says Michael Gordon, senior vice president and commercial payments manager at Kitsap Bank.

“The folks that are getting the debit cards now are the large banks — it was a massive undertaking for them.”

It’s not a cheap undertaking, either. The chip cards cost roughly between $3 and $6 apiece, compared with about $1.50 for the stripe ones.

Customers of Port Angelesbased First Federal, which has branches in Silverdale and Port Townsend, can also expect to start receiving EMV cards this summer. The cards are in the testing phase, according to vice president Michelle Catton, business intelligence and system applications manager.

“It’s been a slow rollout in the United States but we’re getting there,” she says.

The adoption by small merchants has also been slow. Although Visa says that the number of activated merchant locations tripled in the second half of 2015 to 766,000, even many bigger chains haven’t migrated yet.

Gordon says that Kitsap Bank, which also provides credit-card processing for business clients, has been proactively offering EMV equipment and educating customers since 2012.

“Most of our clients have received equipment that’s EMV-capable,” he says. “We were waiting for the industry to say, ‘Here’s the standard and the software to support the standard,’ so customers could download it once it’s released.”

FRAUD CHALLENGES AHEAD

Many security and financial industry experts believe it would take a couple of years for full U.S. migration because the market is very fragmented and involves thousands of banks and processors, not to mention hundreds of thousands of merchants. In the

An example of what the new chip-enabled bank cards look like. Instead of a magnetic stripe on the back of the card, the silver rectangle on the left is the embedded chip that pointof-sale terminals read to process card transactions.

IMAGE COURTESY KITSAP BANK

THE EMV CARD has a transaction signature for each transaction. So if you steal the data, you’re stealing the data about a single transaction, not about the card itself.”

— Ben Knieff, senior analyst at Aite Group

meantime, the cards will continue to come with the magnetic stripe so merchants who are behind can still give patrons the option to swipe their cards.

Once the migration is complete, the Aite Group expects counterfeit card fraud to dramatically decrease in the United States, as it did in other areas. It estimates that fraud losses from counterfeit credit cards will decrease from $3.61 billion in 2015 to $1.77 billion in 2018.

While that’s great news for the industry — and consumers — the improved security at POS terminals will create a new, growing problem: fraud from so-called “card not present” (or CNP).

“EMV is still quite young in the U.S. and it’s going to take some time, but we’re already starting to see more card-not-present fraud,” Knieff says.

Bad actors can still steal credit card numbers by breaching databases or e-commerce sites that don’t have POS terminals (like

healthcare providers, which are becoming a growing target), and then use those stolen numbers for online fraud.

But the good news, according to some cybersecurity experts, is that online credit card fraud is harder to scale.

Aite estimates that CNP fraud will grow from $2.6 billion in the U.S. in 2012 to $6.4 billion in 2018.

“As the card industry is learning more and more how to prevent fraud, the criminals are learning new ways to do it,” Olson says.

That means that businesses such as hotels, professional offices and e-commerce websites — anyone that doesn’t typically use POS terminals — will become a bigger target for hackers.

“The EMV card is very good and solid in terms of protecting your data. But there’s more than one way of buying things,” says Numaan Huq, a Canada-based senior threat researcher with the Forward-Looking Threat Research Team at Trend Micro, a global leader in internet security software.

A hotel, for example, stores credit card information in its system, which could get hacked, Huq says.

“We’ll see more ecommerce sites and hotels being hacked, and we’ll see more mobile payment systems — running on an environment not as secure as POS systems — being breached more,” he says.

As the industry puts an increased emphasis on technology to fight CNP fraud, through better online authentication and advanced analytics, the bad actors also will evolve and find new avenues. Experts expect to see an increase in application fraud and account takeovers, for example.

But bankers like Olson are optimistic.

“We’re encouraged that the largest card processors are col-

laborating to help prevent the use of fraudulent cards,” she says.

“Whether it’s card-present or online fraud, it costs consumers considerably because it ultimately increases the cost of consumer goods.”

ADVICE TO MERCHANTS, CONSUMERS

Gordon says it’s important for merchants to become educated aboutallthesecurityissuesaswell as adopt a multi-layered approach to cybersecurity, including using fraud analytics programs.

“Know your customers — who are you doing business with, does the transaction make sense,” he says.

Huq also recommends taking basic steps like making sure antivirus and antispam programs are up to date, and using a dedicated computer/POS system that’s not used for browsing the internet.

“You can also whitelist applications so only those authorized to run are running, and it won’t be possible for bad guys to install malicious software,” he says.

Consumers, too, need to educate themselves and take measures like knowing who they’re buying from online, changing passwords regularly, maybe even having a dedicated credit or debit card just for online purchases.

“A lot of people are under the belief that if they have a chip card, they’re safe,” says Morris of Liberty Bay Bank. “But it doesn’t do anything for your online purchases or ATM skimming equipment.”

Many consumers have the knowledge to protect themselves better — like the importance of long and complex passwords — but they don’t do those things because they prefer convenience over security, she says.

She sees the migration to better card security as a work in progress — and anticipates the industry will re-evaluate things in a few years. One major point of discussion, for example, is the adoption of chip-and-PIN cards (which are more secure than chip-and-signature and are more standard in other countries).

In the meantime, Gordon says that consumers need to be patient with the transition.

“It’s a shift for everyone,” he says. “But it’s positive because if we can reduce fraud together, ultimately it benefits everyone in the end.”

| March 2016 |

MEEGAN M. REID

Maradel Gale, right, with and her financial adviser, Peggy Ginder of RBC Wealth Management, at Bainbridge Island City Hall. Gale was one of the community investors who funded installation of solar panels on the building’s roof, though that was not part of her investment portfolio that Ginder manages.

Aligning investments with personal values ■ A growing number of investors favor

socially responsible funds and companies

By Terri Gleich KPBJ contributor

IT’S A LITTLE

Maradel Gale has BIT OF A been an environmentalist all her life, but MISCONCEPTION it’s only in the last few that you can’t earn years that she’s begun putting her money the same returns on where her heart is. socially responsible She helped fund the funds.” installation of solar panels on Bainbridge Island City Hall, scrubbed fos— Peggy Ginder, financial sil fuels and mining adviser stocks from her portfolio,andinvestedingreen energy and companies that treat workers fairly. in the United States is in“I don’t want to have my volved in ethical investing. money going to things I And the sector grew 76 perdon’t believe in,” said the cent, from $3.74 trillion in retired University of Ore- 2012 to $6.57 trillion in 2014. gon professor who moved A founder of Sustainable to Bainbridge in 2004.

Bainbridge and the Oregon Gale is not alone. Ac- Environmental Council, cording to the U.S. Forum Gale brushes aside quesfor Sustainable and Re- tions about returns on her sponsible Investment, one investments. It’s more imof every six dollars under portant to her to know that professional management she’s not supporting moun-

taintop removal or destroying the rainforest.

“I want to go to bed at night and be comfortable with what I’m doing,” she said.

Most investors can’t afford to take that view, but there’s evidence they can follow their conscience and still make money. RBC Wealth Management cites a study that found $1 invested in a valueweighted portfolio of sustainable firms in 1993 would have grown to $22.60 by the end of 2010 compared with $15.40 for a value-weighted portfolio of unsustainable firms for the same period.

An analysis by Pax World Investments found ethical investments are less volatile. And numerous studies have shown no negative earnings impact See INVESTMENTS, 10

When it comes to your to-do list, put your future first.

Decisions made in the past may no longer be what’s best for your future.To help keep everything up to date, Edward Jones offers a complimentary financial review.

A financial review is a great opportunity to sit face to face with an Edward Jones financial advisor and develop strategies to help keep your finances in line with your short- and long-term goals.

To find out how to get your financial goals on track, call or visit today.

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Downtown Bremerton 360-373-1263

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| March 2016 |

Big banks rolling out ATMs accessible by smartphones

By James Rufus Koren Tribune News Service

To the long list of things you can do with your phone â&#x20AC;&#x201D; including watch a movie, buy a latte and hail a ride â&#x20AC;&#x201D; prepare to add one more: get cash.

Over the next few months, the nationâ&#x20AC;&#x2122;s three biggest banks will start rolling out ATMs that will let customers withdraw currency using their smartphones instead of debit cards â&#x20AC;&#x201D; the latest step toward a future in which phones could replace bank branches and wallets. â&#x20AC;&#x153;My boys are 5 and 6 â&#x20AC;&#x201D; I donâ&#x20AC;&#x2122;t think theyâ&#x20AC;&#x2122;ll carry around plastic when they grow up,â&#x20AC;? said Michelle Moore, head of digital banking for Bank of America, which plans to make cardless ATMs widely available as early as May. San Francisco banking giant Wells Fargo plans to offer cardless access at a limited number of ATMs by this summer and at all ATMs by the end of the year. Most of JPMorgan Chaseâ&#x20AC;&#x2122;s ATMs will start offering cardless access sometime in the second half of the year.

Cash machines that work with a phone instead of a card arenâ&#x20AC;&#x2122;t new, but they are rare. The number of cardless ATMs stands in the low thousands nationwide.

Soon, theyâ&#x20AC;&#x2122;ll be much more common. Bank of America, Wells Fargo and JPMorgan Chase have a combined 47,000 ATMs, more than 10 percent of the nationâ&#x20AC;&#x2122;s cash machines.

The banksâ&#x20AC;&#x2122; entry into cardless ATMs comes as a small but growing number of Americans are using their phones to send money to one another and to make purchases using so-called

mobile wallet apps such as Apple Pay and Android Pay. It also comes as banks are trying to push customers to do more transactions online, on their phones or through ATMs â&#x20AC;&#x201D; all of which are less expensive than transactions done at branches staffed with tellers.

Just as with mobile wallet payments, which make up a tiny fraction of payments overall, analysts expect using a phone to get cash from an ATM probably will start out as a little-used novelty.

But over the longer term, it could be one more application that will make customers feel comfortable using their devices as ďŹ nancial tools, leading to a general growth in mobile banking, said Mark Schwanhausser, a director at consulting ďŹ rm Javelin Research & Strategy. â&#x20AC;&#x153;Youâ&#x20AC;&#x2122;re acclimating people to the techniques of mobile payments,â&#x20AC;? he said. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s like a mobile wallet on training wheels.â&#x20AC;?

Banks will offer cardless access to ATMs using either near-ďŹ eld communication â&#x20AC;&#x201D; the tap-to-pay technology used in Apple Pay and Android Pay that connects phones with credit card payment terminals â&#x20AC;&#x201D; or codes that customers get through their bankâ&#x20AC;&#x2122;s mobile app.

Using near-ďŹ eld communication, or NFC, a customer would sign in to a mobile wallet or bank app, then physically tap the phone on the ATM and enter a PIN. Bank of America and Wells Fargo plan to roll out NFC access this year, though it will be available only at ATMs equipped with NFC readers.

Wells Fargo expects more than a third of its 13,000 ATMs will have those readers by the end of

the year, while more than half of Bank of Americaâ&#x20AC;&#x2122;s 16,100 ATMs are already NFC-equipped.

Chase also has an NFC system in the works, though spokesman Michael Fusco said heâ&#x20AC;&#x2122;s not sure when it will roll out.

Fornow,Chaseisstarting with a code-based system that requires a software update for ATMs but no new hardware. Wells Fargo will startofferingcode-basedaccess late this year.

Those systems require customers to sign in to their bankâ&#x20AC;&#x2122;s mobile app, request an access code and then type that seven- or eightdigit number into an ATM. The codes can be used once and expire in about 10 minutes, features that aim to prevent codes from being stolen or misused. â&#x20AC;&#x153;After that small window of time, itâ&#x20AC;&#x2122;s a meaningless set of digits that canâ&#x20AC;&#x2122;t be used again,â&#x20AC;? said Jonathan Velline, head of ATM banking for Wells Fargo.

Though customers might worry about seeing their bank accounts pillaged if their phone is lost or stolen, Ed Oâ&#x20AC;&#x2122;Brien, a director at bank consulting firm Mercator Advisory Group, said accessing an ATM with a phone could prove more secure than using a card.

Fraudsters can steal debit card numbers and PINs by installing tiny devices on ATMs â&#x20AC;&#x201D; a crime known as skimming. Industry estimates put bank losses from ATM fraud at $1 billion in 2008, and it probably has grown since then, according to Mercator. â&#x20AC;&#x153;The magnetic stripe has an issue of security.

Someone can duplicate a magnetic stripe, which does happen all too often,â&#x20AC;?

Oâ&#x20AC;&#x2122;Brien said.

But if a phone is stolen,

a thief would have to get past a few layers of security to withdraw cash from an ATM. Theyâ&#x20AC;&#x2122;d need to unlock the phone, sign in to the mobile bank app or mobile wallet and, in most cases, know the customerâ&#x20AC;&#x2122;s PIN. As the banks prepare to launch cardless access,

Bank of America and Chase also are working on more features set to be released later.

Both plan to allow customers to set up an ATM transaction in advance, cutting down on the amount of time they have to spend in front of the machine.

A customer could log in to his bank app and say he wanted to withdraw $150, and that heâ&#x20AC;&#x2122;d like a $50 bill, four $20s and two $10s â&#x20AC;&#x201D; a feature that will be available as the banks also provide more ATMs stocked with multiple types of bills.

Once the transaction is set up, he could go to an ATM, tap his phone, grab the cash and move on.

Schwanhausser of Javelin likened it to picking up tickets at will-call instead of buying them at the box office.

And Oâ&#x20AC;&#x2122;Brien of Mercator said being able to spend less time at the ATM could also improve security. â&#x20AC;&#x153;You get your money in 10 or 12 seconds. Youâ&#x20AC;&#x2122;re not having to look at whether someone is behind you, you donâ&#x20AC;&#x2122;t have to hide your PIN,â&#x20AC;? he said.

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| March 2016 |

SCORE MENTORING | KEN SETHNEY

I’m retired, how can I put my experience to work?

I

f you have owned your own business, or spent much of your career in management roles, you have accumulated a wealth of knowledge. Your knowledge can be valuable to someone starting or working hard to grow their own small business.

In fact, your experience and a willingness to help may be exact-

Investments from 7

from taking that approach.

“It’s a little bit of a misconception that you can’t earn the same returns on socially responsible funds,” said Peggy Ginder, a financial advisor with RBC Wealth Mangement’s Bainbridge office who advises Gale.

Although socially responsible investing makes up less than 10 percent of her business, Ginder said interest is growing as clients ask more questions and seek out companies that have a positive impact.

ly what they need to make their business succeed.

It’stimetopayitforward.

We aren’t asking for your money. We want you, your experience, and a few hours of your time each week to mentor those who ask for help.

The knowledge you contribute may make the difference between the success or the failure

Of particular concern to many of her island-dwelling clientele is not investing in companies that pollute the water or damage shorelines.

“They’re looking for a way to make the world better,” she said. “It’s driven by the investor.”

Often, that means starting with what clients don’t want to invest in — fossil fuels, alcohol, tobacco, nuclear power, for example.

Others look for companies that are making a positive impact by promoting community development in underserved areas or keeping jobs in the U.S. And some ethical investors and funds

Business Briefs Dentists’ office earns EnviroStars certification Fisher Distinctive Dentistry in Port Orchard has qualified as a 4-star EnviroStars-certified business.

The EnviroStars program recognizes businesses for reducing the use of hazardous chemicals and properly managing their hazardous waste.

Fisher Distinctive Dentistry, owned by Dr. Devin Fisher and her husband, Dr. Zack Bergevin, has been serving the Kitsap com-

munity since 1987.

For more information about Fisher Distinctive Dentistry’s efforts to reduce hazardous waste or to schedule an appointment, call 360-876-0445.

The EnviroStars Program certifies businesses for taking steps to prevent pollution and reduce hazardous waste, and the certification is available in many Puget Sound area counties.

For information on EnviroStars in Kitsap County, contact Crystal Nuno with the Kitsap Public Health District at 360-337-5229, or

of small businesses right here in Kitsap County.

Whatmakesa goodmentor?

Anyone can be a mentor, but not everyone makes a good mentor. A good mentor is someone who listens without judgment, empowers with effective questioning, and can be trusted.

A good mentor is an energizer and motivator, assertive and supportive, never critical. He or she is able to draw on personal experience to clarify and simplify complicated issues, to step back when

necessary and see the bigger picture.

A successful SCORE mentor is ready to serve as a sounding board and facilitate the development of new ideas.

Canyoushare 4-5hoursper week?

SCORE is a nationwide organization of business men and women. Each of us has been there, done that, and survived to tell some very interesting stories. SCORE is a nonprofit organization with more than 11,000 volunteers who provide free,

also attempt to shape company policy through shareholder activism.

Today there are more than 950 socially responsible investment funds, according to the Forum for Sustainable Investment.

And that number is likely to grow as millennials get more involved in the market. A 2015 Spectrem Group survey showed the generation that came of age at the turn of the last century is about 10 percent more likely than Gen X and baby boomers to prioritize social impact when making investment decisions.

Gale credits her parents, a CPA and a teacher turned

stay-at-home mom, with instilling the values that guide her investments. “I grew up caring about other people and the outdoors,” she said.

But when Gale first tried decades ago to align her investments with those values, she couldn’t find an advisor who was sensitive to her concerns. “It was much less possible at that time than it is now,” she said.

Not only are socially conscious funds and advisors more prevalent, Internet crowdfunding sites have made it easier than ever to invest in community development. When Gale was looking to sup-

visit visit www.kitsappublichealth.org/envirostars.

well the opportunity to rate the company in specific categories. Martha & Mary gathered its survey results monthly to gain a better understandingoftheirpatients and residents’ needs and make improvements when necessary.

Qualifying for the Pinnacle Customer Experience Award means Martha & Mary scored in the top 15 percent nationally across a 12-month average.

Pinnacle Quality Insight is a customer satisfaction measurement firm that works with morethan 2,200 clients in all 50 US states, Canada and Puerto Rico.

confidential business mentoring and training workshops to small business owners.

Wewouldlikeyoutojoinus.

Please contact Kitsap SCORE by email at kitsap@scorevolunteer.org or phone at 360-3281380. To learn more visit kitsapscore.org.

• Ken Sethney is a volunteer business mentor and branch manager with Kitsap SCORE. He is a former ad agency creative director and marketing coach who worked with the owners of midsize companies throughout the U.S. Contact Ken via email at ken.sethney@ scorevolunteer.org.

port local projects, she went through Community Sourced Capital to help Bainbridge Island’s Eleven Winery purchase an automated bottling machine.

The website matches mission-aligned funders with small business owners in their communities.

Ginder said there’s still a big learning curve for both investors and advisors.

She recently conducted a seminar on Bainbridge with a representative of a socially responsible investment fund and is planning a

similar event in April.

One thing investors should know is that there is no standardized definition for a socially responsible company and each fund has its own criteria for choosing investments. As with every financial decision, investors have to do their homework or have an advisor who does it for them, said Ginder.

“You have to know your goals,” she said. “Social good can be defined differently by every individual.”

KITSAP ’S PREMIER LIVE ENTER TAINMENT & E VENTS VENU K KIT UE

Martha & Mary receives Customer Experience Award Martha & Mary, a Poulsbo–based care provider for children, seniors and families in the West Sound, recently received Pinnacle Quality Insight’s 2016 Customer Experience Award.

During 2015, a sampling ofMartha&Mary’scustomersandtheirfamiliesparticipated in monthly telephone interviews that included open-ended questions, as

Wednesday, April 13 TOWER OF POWER Show 7 p.m.

JANUARY @ 7start P.M. Tickets at $25 THE MUSICAL 26

TICKETS: 360.373.6743 | admiraltheatre.org

| March 2016 |

DAN WEEDIN | BUSINESS STRATEGY

Entrepreneurial myths & monsters

O

ne of the hallmarks of the “American dream” is for that opportunity to build your own business from a passion and have it form your lifestyle and security for generations.

Entrepreneurship is a noble avocation. Many of you reading this are entrepreneurs holding the title of Founder, President, CEO, or just Boss.

Small business enterprise drives the economy of our country and is responsible for employing millions of people. That being said, entrepreneurship requires more than courage, guile, and persistence. To attain both success and significance, entrepreneurs must disabuse themselves of the myths and avoid the monsters that threaten their great achievements.

I’ve identified 5 Myths with accompanying Monsters that must be debunked by savvy entrepreneurs to maximize their impact on customers, clients, employees, and community. Sparing no expense with a fancy headline, allow me to present and offer solutions to Dan Weedin’s 5 Myths & Monsters:

Myth#1:You must work harder and longer hours than anyone else. The subsequent Monster is fatigue and health issues caused by forcing your nose to the grindstone. Just because you’re the boss doesn’t mean you have to work longer hours and perform labor that is more effectively hired or delegated out. You’re the boss for a reason. That position has much more to do with your “smarts.”

You have the task of being strategic and visionary. You should transfer your skills to others through mentoring, training, and coaching. You should allow yourself the time to think about growing your company, providing jobs and value, and seeking new opportunities. Many entrepreneurs founded a business to leave a boss, only to get a much worse one. Don’t be that boss. Be a leader that models efficiency and productivity.

Myth#2: You have no control.

The Monster is discouragement, and this murders innovation and talent. A popular misconception is that most entrepreneurs are control freaks. In my experience, many believe they have little to no control over the economy, their employees, their customers, and local politics, to name a few. This mindset will often lead

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to bitterness and anger, and can be transferred to the culture of the company.

You have more control than you think. You can control the products and services you offer.

You control your pricing. You control whom you employ and for how long. You control with whom and where you do business. You control short and long term strategies. You control how long you want to work. Finally, you control your own attitude. Those that feel powerless will look into the future with dread and anxiety. Those who seize control are opportunistic in any economy or situation. Be the latter.

Myth #3: The future is scary.

The Monster is paralysis by fear.

I’ve talked to people that fear technology, competition, and the zombies charging the hill. There is a reticence to change or try new things.

Smart and sophisticated business leaders are innovative. They brainstorm; they ask “what if:” and they boldly take risks. I have a standing calendar event where every Friday I invest time in thinking up new intellectual property – both in products and services. It doesn’t matter whether I discover something every week or not. What matters

is that I am thinking (there’s that word again).

Don’t stand still. Find a path to the cutting edge in your industry.

Create programs, invent processes and products, and step out of the box with vigor. Try to put yourself “in harm’s way” every day. The result will be an invigorated resilience where innovation rules. That will make the future exciting, not scary.

Myth #4: You’re not deserving. The Monster is loss of confidence. There is a malady called the CEO Effect that postulates that many chief executives are worried that one day they will be found out and thrown bodily from the building.

We all have great value that is demonstrated and shared through our skills and talents. This myth is based on low self-esteem, which seems contradictory to the position of a business leader.

Let’s remember that we are all human and battle past experiences and current challenges, among other things. It happens more often than you think where loss of confidence is a thief of self-worth.

You are deserving. Accept failures as lessons. Define yourself by who you are, not what you do.

Ask for help when you need it, but always remember that you are where you are for a reason. That reason is you, so be proud of it.

Myth #5: You’re alone. The Monster is a combination of loneliness and self-imposed exclusion.

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This is the old Lone Wolf adage.

Many entrepreneurs arrive at that point through years of thinking they are the “only one” that can do, fix, sell, perform, or clean up anything. They become isolated through their own doing.

If you’ve fallen victim to this myth, remember that dogs are pack animals. “Lone wolves” don’t really exist except in our minds. There are many avenues to be part of a pack – executive groups, service/civic organizations, trade associations, coaches/ mentors, and charitable organizations are a good place to start looking.

If you operate from a singular point of view mindset, you end up breathing your own exhaust. We know what happens next. If you choose to find yourself a pack of kindred “dogs,” you’ll open yourself up to new ideas, enhanced perspective, and even a place to just vent!

All of that is good for the entrepreneurial (and personal) spirit!

• Dan Weedin is a strategist, speaker, author and executive coach. He helps business leaders and executives to become stronger leaders, grow their businesses, and enrich their lives. He was inducted into the Million Dollar Consultant™ Hall of Fame in 2012. You can reach Dan at 360-697-1058; e-mail at dan@danweedin.com or visit his web site at www.DanWeedin.com.

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Celebrating over 6,000 successful job placements on the Kitsap Peninsula!

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| March 2016 |

HUMAN RESOURCES | JULIE TAPPERO

Challenges of meshing with ‘contingent workforce’

S

ince 1998, I have been involved with the “contingent workforce” as the owner of a staffing company. In that time, more than 6,000 people have worked for us in jobs in the West Sound.

These folks, and many others, are part of what is now being described as a seismic shift in the workforce.

The advent of companies such as Uber, TaskRabbit, Topcoder and others is shining a huge spotlight on the nontraditional or non-employee worker.

We would be hard pressed to find a business who hasn’t at some time used a temporary employee, freelancer, independent contractor, or other type of free agent worker. What does this increasing trend mean for our businesses and for our workplaces?

According to a study by JPMorgan Chase Institute, 10.3 million workers in America, 6.5 percent of the total workforce, received at least some of their income from the so called “gig economy” between 2012 and 2015. Not included in that number would be those employed by staffing companies.

More than 14 million workers in America work as temporary or contract employees during the year, according to the American Staffing Association. In fact, the size of the total contingent workforce in the U.S. is estimated to be as high as one-third of the workforce.

The Institute for Corporate Productivity (i4cp) has published an interesting report, Beyond Uber: Driving the Evolution of Work, in which they discuss these trends and the implications for employers and their human resource managers.

Workers today recognize their employers have less loyalty to them, and many see an advantage in taking charge of their own careers by becoming “free agents.”

The i4cp report shows that millennials, in particular, seek flexibility and control.

They appreciate opportunities for new experiences, and thrive with project-oriented

Banks from 4

First Federal director of retail banking Dawnya Textor said the approach melds traditional banking methods with emerging

work. Oftentimes, this makes them perfect candidates for the “gig economy.” On the other end of the spectrum are baby boomers, many of whom desire to work beyond retirement, but when doing so want that same flexibility and control. They may choose opportunities to work remotely, part-time, or as consultants doing projectbased work. With technology, and the mobility of our workforce, companies today can readily access talent not available to them before — a necessity as we face talent shortages.

While being able to tap into talent on demand has its advantages, it definitely brings challenges as well. It’s a challenge to build a cohesive team, blending people who work for themselves or someone else and who are not committed to our business, while maintaining our company’s culture.

Another issue can be building trust among the total team, as our in-house employees may feel their own jobs are threatened by the non-employee worker.

Business leaders and frontline supervisors need new skill sets to manage this workforce. The i4cp report points out that there is a heightened atmosphere of uncertainty and ambiguity, in a workplace that requires greater collaboration, and a workforce that is increasingly diverse. Top that off with workers who may work remotely or sporadically, and you can quickly see that sophisticated communication skills, empowered leaders, and organizational agility are just some of the requirements for success.

What does this all mean for our HR departments, or those who do the hiring and people planning in our businesses? We’re talking about a more nimble workforce, with some contributors who move in and out of the team as needed. Previously, we wrote a job description, hired a worker, and were good to go. In this new workplace, the planning component is more complicated and rigorous. According to the i4cp report, the work to be performed becomes the focus, and it will be important to break down

technology, while still creating jobs.

“It allows us, as we expand into new market areas, to offer jobs in the new areas and grow in our existing footprint,” she said.

After successfully moving into Kitsap, First Federal

added a branch in Bellingham last year. Liske said the bankwillkeepsearchingfor opportunities to grow.

“We continue to evaluate the communities we’re in and as well the communities we’re looking to for expansion,” she said.

13

the work itself into projdemand economy … the ects and tasks. The tasks names go on and on! It’s may be accomplished by interesting to note, howPREVIOUSLY, a temporary employee, ever, that David Weil, a WE WROTE a an independent contracblogger for the Departtor, or some other methment of Labor, refers to job description, od of outsourcing, rather it as the “fissured workhired a worker, than adding a permanent place.” He’s concerned staff member. Workforce that this new paradigm and were good planning abilities will results in low pay. In his to go. In this take on new importance blog, he writes, “The costs new workplace, and the human resource in this race to be the lowdepartment must be part est bidder are borne by the planning of the strategic planning workers deprived of their component process, partnering with wages and the rights.” departments as projects While I can’t say whether is more are defined and planned. his concerns are valid, complicated and It will become essential what I can say is that it rigorous. for whomever is doing the appears clear that both hiring to become a skilled workers and businesses talent sourcer. There will are moving in this direcbe many ponds to fish tion, and ensuring that from on a global basis, and knowing the our workplaces are not fissured, and that right direction to head will be essential. both businesses and workers flourish, will Considerations aren’t just about cost and be crucial as we move forward into this quality of the worker — fit within the com- new economy. pany culture is essential as well. This takes talent management to a whole new level.

• Julie Tappero is president and owner There are many names for this new of West Sound Workforce, a professional workforce. It’s referred to as the freelance staffing and recruiting company based in nation, contingent workforce, gig economy, Poulsbo and Gig Harbor. She can be reached solopreneurs, digital economy, nontradi- at julie@westsoundworkforce.com. tional workforce, sharing economy, on-

FINANCIAL NETWORK CORINTHIAN WEALTH PARTNERS, LLC

Would like to officially welcome

Todd Hankins

Chartered Retirement Planning CounselorSM Financial Advisor Todd is accepting new clients and can be reached at:

Direct 360-551-4521 Toll Free 855-834-8503

Office 360-551-4513 Todd.Hankins@WFAFINET.com 3212 NW Byron Street, Suite 101 Silverdale, WA 98383 *Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), member SIPC. Corinthian Wealth Partners is a separate entity from WFAFN.

14

| March 2016 |

FINANCIAL PLANNING | EDWARD JONES

Watch for FAFSA changes Article provided by Edward Jones for use by ďŹ nancial advisor Jay Seaton of Port Orchard.

I

f you have a child in college, youâ&#x20AC;&#x2122;re probably familiar with the Free Application for Federal Student Aid (FAFSA), which must be completed to help ensure that students donâ&#x20AC;&#x2122;t miss out on federal and state grants, work-study jobs and loans. But you might not know that some important changes will be coming to the FAFSA during 2016 â&#x20AC;&#x201C; and these changes can affect both the process of ďŹ ling for aid and, possibly, the amount of aid your child will receive.

Here are three key changes to watch for: â&#x20AC;˘ Earlier availability of the FAFSA â&#x20AC;&#x201C; Currently, you need to complete the FAFSA as soon as possible after Jan. 1 â&#x20AC;&#x201C; which means youâ&#x20AC;&#x2122;re probably ďŹ lling out the form even before youâ&#x20AC;&#x2122;ve ďŹ led your taxes, which arenâ&#x20AC;&#x2122;t due until April. As a result, you may have to estimate your income and update the information later. However, beginning with the 2017â&#x20AC;&#x201C;18 school year, you can complete the FAFSA starting on Oct. 1 of the previous calendar year, rather than wait until January. At that point, you will already have ďŹ led your 2015 taxes, so in ďŹ lling out the FAFSA, you wonâ&#x20AC;&#x2122;t have to rely on estimates of your income.

How should you respond to market â&#x20AC;&#x2DC;correctionâ&#x20AC;&#x2122;?

Article provided by Edward Jones for use by ďŹ nancial advisor Jim Thatcher of Bremerton.

A

s an investor, you may be gaining familiarity with the term â&#x20AC;&#x153;market correction.â&#x20AC;? But what does it mean?

And, more importantly, what does it mean to you?

A correction occurs when a key index, such as the S&P 500, declines at least 10 percent from its previous high. A correction, by deďŹ nition, is short-term in nature and has historically happened fairly regularly â&#x20AC;&#x201C; about once a year. However, over the past several years, weâ&#x20AC;&#x2122;ve experienced fewer corrections, so when we have one now, it seems particularly jarring to inves-

tors.

How should you respond to a market correction? The answer may depend, to some extent, on your stage of life. â&#x20AC;˘ If youâ&#x20AC;&#x2122;re still working â&#x20AC;&#x201D; If you are in the early or middle parts of your working life, you might not have to concern yourself much about a market correction because you have decades to overcome a short-term downturn. Instead of selling stocks, and stock-based investments, to supposedly â&#x20AC;&#x153;cut your losses,â&#x20AC;? you may find that now is a good time to buy more shares of quality companies, when their price is down.

Also, you may want to use the opportunity of a correction to become aware of the need to periodically review and rebalance your portfolio. Stocks, and investments

â&#x20AC;˘ For 2016 only, this change presents something of an anomaly â&#x20AC;&#x201C; speciďŹ cally, you should ďŹ ll out the FAFSA as soon as possible for the 2016â&#x20AC;&#x201C;17 school year, using an estimate of your 2015 income, and then complete the FAFSA again in October for the 2017â&#x20AC;&#x201C;18 school year, using your actual 2015 income. In future years, youâ&#x20AC;&#x2122;ll only have to complete the FAFSA once, with applications accepted beginning each Oct.1. â&#x20AC;˘ Lower â&#x20AC;&#x153;asset protectionâ&#x20AC;? allowance â&#x20AC;&#x201C;When you report your ďŹ nancial information on the FAFSA, some of your assets â&#x20AC;&#x201C; such as your IRA and 401(k) â&#x20AC;&#x201C; are not counted toward the resources youâ&#x20AC;&#x2122;re expected to contribute to your childâ&#x20AC;&#x2122;s education. Some other assets are considered available, but a percentage of these assets can be sheltered, with the exact amount depending largely on your age and marital status. For the 2016â&#x20AC;&#x201C;17 school year,

this sheltered asset amount has been reduced signiďŹ cantly. However, while this reduction could have some effect on your studentâ&#x20AC;&#x2122;s aid package, it shouldnâ&#x20AC;&#x2122;t be too severe because income, more than assets, is a bigger factor in the federal ďŹ nancial aid formula. â&#x20AC;˘ No more shared mailing list â&#x20AC;&#x201C; When ďŹ ling the FAFSA, students can choose up to 10 colleges to receive their ďŹ nancial information. Previously, when students sent their FAFSAs to multiple colleges and universities, these schools could see the other institutions on the mailing list. But starting with the 2016â&#x20AC;&#x201C;17 application, schools will no longer have this information. This could actually beneďŹ t your child. Previously, if a school saw it was listed ďŹ rst on the FAFSA, it might have assumed it was the studentâ&#x20AC;&#x2122;s

containing stocks, often perform well before a correction. If their price has risen greatly, they may account for a greater percentage of the total value of your portfolio â&#x20AC;&#x201C; so much so, in fact, that you might become â&#x20AC;&#x153;overweightedâ&#x20AC;? in stocks, relative to your goals, risk tolerance and time ho-

rizon. Thatâ&#x20AC;&#x2122;s why itâ&#x20AC;&#x2122;s important for you to pro-actively rebalance your portfolio â&#x20AC;&#x201C; or, during a correction, the market may do it for you. To cite one aspect of rebalancing, if your portfolio ever does become too

See FAFSA, 18

See MARKET, 18

Supporting Our Community 2015

U W K s

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www.pnwtkitsap.com

| March 2016 |

Chipotle, Total Wine to open in March at Trails Another wave of stores are set to open next month in The Trails at Silverdale shopping center.

Chipotle Mexican Grill will debut March 10, according to a spokeswoman.

So will beverage retailer Total Wine and More.

MOD Pizza, a Seattlebased, made-to-order pizza chain, expects to launch its Trails location March 18.

The county has issued tenant improvement permits to Corner Bakery Café, Forever 21, Verizon, DSW and Sleep Number, allowing those companies to begin outfitting their stores.

A representative for developer CenterCal Properties confirmed Old Navy also is planning a Trails store.

Silverdale Smiles Dentistry was the most recent business to open at the

York Times, Chipotle turned to food safety specialist Mansour Samadpour to overhaul its safety protocols. Samadpour is a familiar name in Kitsap. He owns prominent properties in downtown Port Orchard.

Greaves Way shopping center, joining Blazing Onion, Homegoods, Ulta Beauty and AT&T. Centercal has yet to announce tenants for a few remaining retail spaces, including a planned grocery store. The developer began work on The Trails in August 2014.

The opening of Chipotle — the first west of Puget Sound — has been highly anticipated since it was announced last summer. But the chain’s reputation took a beating this winter as a series of E. coli and norovirus outbreaks were linked to its restaurants.

According to the New

County saw retail sales top $1 billion in Q3 2015 Taxable retail sales in Kitsap County topped $1 billion for the first time in the third quarter of 2015.

The $1.01 billion in sales reported from July through September marked a 9 percent increase from the same period of 2014, according to the Department of Revenue.

Retail trade sales were also up about 9 percent in the third quarter, with $524 million reported. Retail trade sales are sales made by dealerships, stores, on-

line sellers and other traditional retailers.

These were some Q3 highlights: • Sales by new and used auto dealerships were up 19 percent • Sales of building materials were up 8.6 percent • Sales by general merchandise stores were up 6

percent • Construction was up 9.25 percent • Wholesale trade was up 11.4 percent • Information was up 10.5 percent • Accommodations and food services up 8.9 percent The jump in third quarter retail sales came

15

on the heels of an 11 percent increase in secondquarter sales. We should see sales figures from the fourth quarter of 2015 a few months from now.

• Minding Your Business is a blog written by Kitsap Sun reporter Tad Sooter.

FOR SALE 20 ACRES INDUSTRIAL ZONED $530,000 20 Acres in Silverdale zoned industrial, flat usable with timber, most utilities in road.

CBA# 541947 MARCUS HOFFMAN 360-271-0023 COMMERCIAL INDUSTRIAL $299,000 Office duplex building ready to occupy or lease out. Recent upgrades including roof, siding, floors and more. MLS# 807789 DENNIS BALDUF 360-649-5053 COMMERCIAL ACERAGE $250,000 Prime 3 acres in Bremerton located across from Bay vista and zoned Industrial Park. Which allows a variety of uses next to the City of Bremerton Utilities Dept. CBA# 531623 MERV KILLORAN 360-620-2829 COMMERCIAL PROPERTY $99,900 Great corner lot, .26 of an acre with 136’ of Chico Way road frontage. Level and cleared ready for your Rural Commercial building. Natural gas, electricity,

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Partial view of Dyes Inlet.

MLS# 695829 DAVE & CINDY MCKAY 360-620-5451 OR 620-6490 DEVELOPMENT POTENTIAL $250,000 Large .67 acre site with a 1500 SF one-level residence-Preliminary drawing with engineering estimates to develop the sit into an additional 4 lots. Sewer on site. MLS# 860178 MERV KILLORAN 360-620-2829 COMMERCIAL PROPERTY $140,000 Great opportunity to own three commercial lots in Bremerton, close to PSNS, bus lines, Seattle ferry and Highway 3! All three parcels assess for well over the asking price! One parcel has a small home that is currently used as a rental. MLS# 867979 DAVE & CINDY MCKAY 360-620-5451 OR 620-6490

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16

| March 2016 |

STEVE ZUGSCHWERT FOR KITSAP PENINSULA BUSINESS JOURNAL

Brandon Thompson, left, is the pizza chef for Bruciato, the pop-up pizza service on Monday nights at Hitchcock restaurant on Bainbridge Island. Hitchcock chef and owner Brendan McGill, right, is expanding Bruciato to a full-time restaurant that will move into the vacant building being renovated just up the street at 240 Winslow Way.

Pizza night will spin off into full-time restaurant ■ Bruciato moving to long-vacant Bainbridge site;

co-tenant will be Realogics Sotheby’s real estate office

By Tim Kelly

tim.kelly@kitsapsun.com 360-792-3359

The prime retail space that was curiously blank the past few years in downtown Bainbridge Island will have a distinctive new look this summer, when Bruciato moves into the Winslow Way building.

Bruciato operates as a “pop-up” pizza service on Monday nights at Hitchcock, chef Brendan McGill’s fine-dining restaurant on Winslow Way. Brandon Thompsonisthehandmade pizza specialist — “pizzaiolo” in Italian — who lives on a sailboat and has been partnering with McGill for several years on the weekly Bruciato events, and also works at Hitchcock and the Hitchcock Deli next door.

Now they’re planning to

Winslow Way site.

L acko, who moved to Bainbridge in 2014, said there also will be several small office spaces at the back that will be leased.

“I had looked at the building when it was for sale,” McGill said of the propILLUSTRATION COURTESY REALOGICS SOTHEBY’S erty that Storyville A rendering by architect Dana Webber of what the 240 Winslow Way storefront will look Coffee owned for like when Bruciato and Realogics Sotheby’s share the space. four years but left empty. “I actually open Bruciato as a full-time nounced in mid-February put a group together and restaurant across the street, it will be the other main attempted to buy it. What in the former Island Hard- tenant in the 6,350-square- we found out was, it’s a ware building that’s been foot building. The real es- beautiful shell, but the work vacant since 2011. tate company, which has required needed more of a The pizzeria will occupy operated on Bainbridge real estate developer.” about 2,500 square feet in since 2011 and has 18 agents, “I thought it would be a the building that Joseph will consolidate its main cool space for a restaurant,” Lacko bought last fall and office on Madison Avenue he added. “It feels really is redeveloping. and a small satellite office special to get a crack at doRealogics Sotheby’s in what it calls an “Island ing something there.”

International Realty an- Living Gallery” at the 240 McGill plans for the new

place to have a full bar, with an open, family-friendly dining area centered around the special woodfired oven that’s coming from Naples, Italy.

Bruciato’s pizza is upscale — authentic Neapolitan-style pies, with hand-tossed crusts made from fermented dough, and topped with house-cured meats — but the new place will have a more casual atmosphere than Hitchcock.

“It’sdesignedtobeacomfortable, family-friendly environment,” McGill said. “I don’t think this place will be overrun with kids like a ChuckE.Cheese’s,butfamilies can come in and enjoy themselves.”

The pizzeria also might be a gathering place occasionally for watching special sports or entertainment events. It won’t have TVs, but McGill said a projection system could be set up for viewing.

“One of the things we

miss out on in the fine dining world is events like the Super Bowl … or maybe we’d hold something for the Oscars,” he said. “I think that would go hand in hand with a casual place like this.”

The chef said Bruciato also might offer late-night bar service on Fridays and Saturdays, to give Bainbridge night owls somewhere to go after most places on the island shut down.

The weekly pizza nights have proved a big draw since the first time Bruciato popped up for the island’s Fourth of July parade in 2010. Thompson said during the winter months they’re serving about 60 pizzas a night.

“But in the summer it’s a beast; we usually make about 140,” he said. “Last Fourth of July we did a little service for the parade, and we did 160 pizzas in two hours.”

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18

| March 2016 |

McCormick Woods to spread roots

WE BOUGHT THE PROPERTY because we think it’s a wonderful opportunity. We’re really pleased with the quality of homes around there.”

■ New land owner plans to start building homes on remaining 1,100 acres

By Tad Sooter tad.sooter@kitsapsun.com 360-475-3783

A Kirkland-based firm has purchased the remaining vacant land within the McCormick master plan area and will push ahead with development this year.

Newly formed McCormick Communities LLC bought more than 1,100 acres from Gem 1 LLC at the end of December for $18 million, according to county assessor’s documents. The 33 parcels include the undeveloped sections of McCormick Woods, the expansive McCormick West plat, and McCormick properties north of Old Clifton Road. More than 2,000 lots have been platted for the land, all of which was annexed into Port Orchard in recent years.

McCormick Communities shares ownership with Kirklandbased Windward Real Estate Services, a development firm that has worked on a number of master planned communities in Washington. Windward President Jim Tosti said the strengthening real estate market at the south end of the Kitsap Peninsula made the McCormick properties attractive.

“We bought the property because we think it’s a wonderful opportunity,” Tosti said. “We’re really pleased with the quality of

— Jim Tosti, president of Windward Real Estate Services

LARRY STEAGALL/KITSAP SUN

Undeveloped land near the existing McCormick Woods neighborhood in Port Orchard has been sold to a Kirkland developer, who plans to proceed with building more homes .

homes around there.”

The land previously was held

by Gem 1, a corporation formed

by McCormick Land Co. and Granite Land Co. McCormick Land President Doug Skrobut did not return a call for comment on the sale.

Tosti said McCormick Com-

FAFSA

MARKET

first choice and, as a result, may not have felt the need to be flexible in awarding financial aid. Now, though, without a list of its competitors, a school might be more open to negotiating a more favorable aid package for your child.

It’s a good idea to stay current on the changes connected to the FAFSA because it helps determine financial aid eligibility – and financial aid is a key component of your strategy to pay for your child’s (or grandchild’s) education.

“stock-heavy,” you may need to add some bonds or other fixed-rate vehicles.

Not only can these investments help keep your portfolio in balance, but they also may hold up better during a correction.

• If you’re retired — After you retire, you may need to take money from your investment accounts – that is, sell some investments – to help pay for your cost of living. Ideally, however, you don’t want to sell stocks, or stock-based vehicles, during a correction – because

from 14

from 14

munities intends to stick with existing plans for the property as much as possible. Site work will begin early this year on Lot D of McCormick Woods, a 73-acre parcel platted for about 170 lots.

Tosti said Windward is in discussion with contractors interested in building homes at Mc-

when you do, you may be “selling low.” (Remember the most common rule of investing: Buy low and sell high. It’s not always easy to follow, but it’s still pretty good advice.)

So, to avoid being forced into selling, you need to be prepared. During your retirement years, try to keep at least a year’s worth of cash instruments on hand as well as short-term fixed income investments. By having this money to draw on, you may be able to leave your stocks alone and give them a chance to recover, post-correction. And it’s important to maintain a

Cormick.

“We’re talking to all the major builders in the Northwest,” Tosti said.

Development on the McCormick properties slowed during the recession, though land-use approvals and annexation plans marched ahead. The city annexed

reasonable percentage of stocks, and stock-based vehicles, in your portfolio, even during retirement – because these investments may provide the growth necessary to help keep you ahead of inflation. Consequently, as a retiree, you should have a balance of stocks and stock-based vehicles, along with fixedincome vehicles, such as bonds, certificates of deposit, government securities and so on.

Being prepared can help you get through a correction – no matter where you are on life’s journey.

McCormick Woods in 2009, bringing about 1,200 residential parcels and 2,000 residents into the fold. The 600-acre McCormick West properties, approved for 1,500 homes, were annexed in 2011.

The sale of the McCormick properties could add to a wave of residential construction in South Kitsap. Quadrant Homes has built and sold most of the houses in its 170-lot McCormick Meadows neighborhood off Feigly Road. Freestone Communities is at work on 250 houses along Anderson Hill Road. Between those two developments is the plat for Sinclair Ridge, which developers hope to scale back to 343 homes.

Kitsap Transit to buy Annapolis dock from Port Kitsap Transit and the Port of Bremerton have agreed on a price for the Annapolis dock. The transit board will be asked to buy the facility from which the agency operates passenger ferries for $947,000.

Kitsap Transit had been leasing the dock from the port but needed to own it or hold at least a 30-year lease before the federal government would fund improvements. It has long sought to make the facility ADA-compliant.

Kitsap Transit already

owns the uplands, where there’s a parking lot and shelter. The port owns the pier, gangway and float.

The pier would be pushed farther into Sinclair Inlet so the float no longer bottoms out at low tide.

The Bremerton-Annapolis ferry route primarily serves shipyard workers.

Kitsap Transit received $900,000 from the federal government to complete a preliminary design and environmental review to assure the project won’t disturb natural resources. It has applied for a $3.6 million grant for construction, which wouldn’t begin before 2017.

EWSLETTER KBA NEWSLETTER

VISIT the HBA Website! www.kitsaphba.com

Wednesday, March 2 Remodelers Council Meeting, 4pm KBA Office Universal Design/Accessibility Wed., March 2 & Thurs., March 3 Certified Erosion & Sediment Control Lead Register w/ BIAW (360) 352-7800 Class at KBA Office Friday, March 4 CESCL Recertification CESCL Certifications must be renewed every 3 years Register w/ BIAW (360) 352-7800 Class at KBA Office Tuesday, March 8 Builder Breakfast, 7:30am Elmer’s Restaurant in Poulsbo Special guest is Mayor Becky Erickson RSVP to KBA Thursday, March 10 SPECIAL DATE Developers Council Meeting, 7:30am KBA Office Thursday, March 10 Peninsula Home & Garden Expo Cmt. Mtg. 11:00 am at the KBA Office Friday, March 11 Basics of Building Class Build your housing industry expertise from the ground up!

Register w/ BIAW (360) 352-7800 Class at KBA Office Friday, March 18—Sunday, March 20 Peninsula Home & Garden Expo Friday 2pm – 8pm Saturday 10am – 6pm Sunday 10am – 5pm Kitsap County Fairgrounds! www.kitsaphbahomeshow.com Thursday, March 31 Executive Committee Mtg., 2:00pm Government Affairs Cmt., 2:30pm Board of Directors, 3:30pm

It’s time for the annual Peninsula Home & Garden Expo. This Expo is locally owned and operated by the Kitsap Building Association.

We continue to put the “garden” back in Home & Garden and are thrilled to have beautiful nursery and landscape displays again this year. We have exciting on-trend seminars for your garden and home, as well as a huge array of vendors that are sure to inspire you! With a low admission fee (free parking!) you can attend all the activities and attractions of the day! Consider an “All Access Pass” so you can attend the Expo each day!

Friday, Saturday, Sunday: • Buy beautiful plants for your garden!

• Learn how to beautify your yard and patio!

• Enjoy the Garden-Art Walk with creative sculptures by Peninsula artists!

• Complete the Scavenger Hunt of Expo Vendors card and enter for a chance to win a $50 value! (Scavenger Hunt Card found in the Official Expo Guide produced by the Kitsap Sun and delivered in the Tuesday, March 15 edition of the paper. Guides also available at the Expo!)

Friday (2pm – 8pm): • Attend the “Bolt it Down!” class and learn why it’s important to protect your home from an earthquake and how easily it can be done. (Advanced registration strongly encouraged. Class at 3pm in the Kitsap Sun Pavilion).

• Meander through the Garden-Art Walk all day!

And so much more!

Saturday (10am – 6pm): • Meet regional gardening celebrity • Ciscoe Morris in the Kitsap Sun Pavilion on the Mezzanine level at 3pm.

• Stroll through the Garden-Art Walk all day!

And so much more!

Sunday (10am – 5pm): • Kids can compete in the Lego® Brand Building Challenge! This event is for children 5 – 12. Advanced registration required.

• Attend the class “Select and Grow Tomatoes!” Learn from the Kitsap County Master Gardeners. Class is in the Kitsap Sun Pavilion classroom at 1pm.

• Wander through the Garden-Art Walk all day!

And so much more!

Join us March 18 – 20 at the Peninsula Home & Garden Expo, the biggest and best home show west of Seattle!™ . This event is at the Kitsap County Fairgrounds (1200 NW Fairgrounds Rd). All the details are on our Expo website at www.kitsaphbahomeshow.com including a downloadable $1.00 off admission coupon. Consider the All Access Pass ($10) for re-entry privileges each day!

2016 Officers President................................... Kevin Ryan 1st Vice President............... Miriam Villiard 2nd Vice President ...........Berni Kenworthy Treasurer ............................. Leslie Peterson Secretary ..............................Brent Marmon Immediate Past President..... Judy Mentor Eagleson

2016 Builders & Assoc. Directors Bill Broughton, Ellen Ross-Cordoso, Walter Galitzki, Stuart Hager, Jim Heins, Joe Hurtt, Chad Lyons, Brendan McGeer, Jo Pederson, Shad Smallwood

2016 State Directors Robert Baglio, Lary Coppola, Judy Mentor Eagleson, Wayne Keffer, Berni Kenworthy, Ron Perkerewicz, Kevin Ryan, Miriam Villiard

2016 Alternate State Directors Rick Cadwell, Kevin Hancock, Byron Harris, Justin Ingalls

Life State Directors Bill Parnell

2016 National Directors Berni Kenworthy, Shawnee Spencer, Kevin Ryan

2016 Alternate Natnl. Directors Mike Brown, Jeff Coombe

Life Directors Rick Courson, Bob Helm, Bill Parnell, John Schufreider, Dori Shobert, Jim Smalley, Larry Ward

2016 Council & Committee Chairs Build A Better Christmas ..... Randy Biegewald Built Green.............................Walter Galitzki

By Laws & Nominations ........Judy Eagleson Developers Council..................... Mike Wnek Golf Classic........................Shawnee Spencer Govt. Affairs Cmt..................Miriam Villiard Remodelers Council Chair.....Molly McCabe Membership ....................... Berni Kenworthy Parade of Homes .................................... TBD Peninsula H&G Expo....................Lena Price Peninsula H&R Expo Leslie Peterson & Judy Eagleson

HBA Staff Exec. Vice President .....Teresa Osinski, CGP tosinski@kitsaphba.com Events & Admin. Assistant .......Katie Revis hbaevents@kitsaphba.com

Home Builders Association of Kitsap County 5251 Auto Center Way, Bremerton, WA 98312 (360) 479-5778 • (800) 200-5778 FAX (360) 479-0313

www.KitsapHBA.com

KBA NEWSLETTER KBA NEWSL

Kitsap Building Association • www.KitsapHBA.com Events And Special Features Activities Don’t miss out!

MARCH 2016

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

E +. . #2< H2D< =+()A7 D+. +0( = + 0 += +/42<A 0A A2 D0 <=A 0 0 A) 2D<= = 20 (< 0 D+. +0( 2D. ) 0( <.H +=+20= H2D / - 20 4<2, A 0 ..2F A) =A<D AD< A2 F2<- =A F+A) 2A) < AD< #2< H <= A2 2/ 7 .. A) #2< .+=A 2# CJ3? . == =7 ) 0-= #2< 4D..+0( 20 A) < +0 2 A 0 ) < ) A ) H 0 +0( 4 <A 2# A)+= < 2< < -+0( H <"

)<2D() A) +A= 4 D+. +0( ==2 + A+20 4<2# ==+20 .= +0 +A= 4 2D0AH 0 AA 0 +/42<A 0A =2/ A+/ = / 0 A 2D<= =7 D< 2//+A/ 0A A2 ) .4+0( 2D< +0 D=A<H A2 A) =A D A 0 4< 4 < 2 = 02A 20.H GA 0 A2 2D< / / <=7 D< . == = < 24 0 A2 0H 2/4 0H7 / <= < +E 4< # << 4<+ +0(7 )+= H < A) ) = .< H ) . #D.. <A+$ A+20@ <A+$ A+20 . == AF2 @3=A + . == = 0 #D.. H 2D<= 20 + 0

F= 20=A<D A+20 20A< A+0(7 ) E / 0H /2< +/42<A 0A . == = 2/+0( D47

) <A 2# ## A+E AF2<-+0( ! 4<+. > 1 / A2 220 +(0+$ 0A ) 0( = +0 A) CJ3& D+. +0( 2 = ! 4<+. 3C / A2 220 < 0 D+. +0( #2< D+. +0( <2# ==+20 .= ! 4<+. 3B 0 3' / ! &4/ +.H D=+0 == 0 ( / 0A #2< D+. +0( <2# ==+20 .= ! 4<+. 3& / *&4/ @3=A + ! 4<+. C? 3 BJ4/ A2 &4/ 5C < <A+$ A+206

+(0+$ 0A ) 0( = +0 A) CJ3& D+. +0( 2 = !

D0 1 / A2 220 2E ) A 2D= " ..+0( A) 20A+0( 0A 2/ !

D0 3J 34/ A2 '4/

D.H <A+$ <2=+20 +/ 0A 20A<2.

5 6 !

D.H CJ 0 C3 / A2 &4/ +.H 5 0 .D = D0 )6

<A+$ A+20 !

D.H CC / A2 &4/ 5 0 .D = D0 )6

20=A<D A+20 0 ( / 0A ! A2 < C? / A2 &4/

! =A+/ A+0( #2< D+. <= /2 . <= ! 2E / < C / A2 &4/ A ) #2< 0 F . == = H E+=+A+0( 2D< F =+A ..+0( 2D< 2#$ F A )+0( A) /20A).H :B )+0(=; / +. 2< (2+0( A2 A) F =+A 0 .22-+0( A ..

A) . == = 2## < <2D0 A) A A 7

Government Affairs Committee Miriam Villiard, Heritage Builders NW LLC

Guest Column by: Elliot Eisenberg, Ph.D., GraphsandLaughs, LLC Elliot@graphsandlaughs.net

Does your vote count?

No Housing Bubble

2016 is proving to be an exciting year in the political world, nationally and locally. The presidential election is heating up as candidates spend more time flinging mud at one another and then defending themselves from the mud that is flung at them than they spend on presenting themselves to the American public. There are a few that are trying to stay above the fray, but I fear that though Americans say they are fed up with the political bashing that occurs, that it is ultimately what sells. It’s what makes the mainstream media and headline news. The quiet, yet articulate candidate, who vows to not be drawn into the raucous, may very well become lost on the stage of the loud-mouth, name-calling, attention-grabbing antics of the majority.

I challenge each of you reading this article to encourage everyone you know to spend time researching the candidates, their agendas, and what this means to you, your community, and your country. Have conversations with your children about the elections. I found my 15-year-old daughter watching the Republican Debate on Youtube, while doing her homework. It created a great opportunity to hear her perspective of the candidates and the debate, and for us to talk about the pros and cons of the candidates. Though she’s a few years from voting, I hope that her mind has been opened enough to understand the importance of voting and the magnitude of each vote. Whether you’re voting in local, state or national elections, your vote counts. It’s the collective little steps, or in this case votes, that will create the change. If you don’t take action, you cannot complain about the results or the country in which we live.

I wonder how many people in the South Kitsap area, who could have voted for or against the South Kitsap School District No. 402 Proposition No 1, didn’t vote because they ran out of time or didn’t think their vote would count. This proposition missed the approval mark by a mere 38 votes. 38 votes! As an owner of a custom home building and remodeling company this saddens me because I’m seeing first-hand the radical effect budget cuts have had on the quantity and quality of young adults coming out of high schools with a skill that they use to create a life for themselves and be a productive asset to our society.

20 years ago students graduating from high school, who weren’t college bound, often had acquired a trade skill either through Career and Technical Education (CTE) classes in high school or they had worked in a trade and learned the skills through their teenage years. Today, many of the CTE classes have been cut from the curriculums and we have a large number of students graduating, barely graduating, or dropping out of school with no skills or means of making a living.

We’re failing our children by not adequately preparing them for life after high school. Our schools are struggling to provide diverse curriculums to a variety of students to meet the needs of our skills-based industries. Additionally, our population is expected to increase putting further demand on our schools. So if you don’t feel that your vote counts, may I remind you that the South Kitsap bond was 38 votes from passing. The bond will be back before voters in April. I hope you will take the time to cast your vote to support the construction of a new high school. Your vote counts.

House prices are once again regularly in the news and have been rising for 43 straight months. In cities such as Boston, Denver and San Francisco, prices today are higher than they were during the peak of the housing boom. In other cities, while prices have not regained the ground they lost during the housing bust, they are rising smartly and are not far off the peak prices of last decade. That said, a housing bubble does not appear to be forming, and even if one is on the horizon, it certainly is not being creditfueled, and thus is far less dangerous than what we recently experienced.

While in a few cities home prices are at or above the highs of the housing boom, on average, home prices are still well below their previous peaks. Depending upon the house price index used, sales prices are currently 5% to 10% below their 2006 peaks, and at levels first observed in early to middle 2005, six to 12 months before they peaked. Moreover, after adjusting for inflation, house prices are about 20% off their all-time highs. At the current rate of house price appreciation, it will take another four years for inflation-adjusted house prices to fully regain their 2006 levels. Despite the rhetoric, house prices are not nearly as high as they are being made out to be.

In addition, back in 2006, housing affordability was dismal. At that time, a family earning the median income barely had enough income to qualify for a conventional conforming mortgage for the US median-priced home. Today, that same household has almost 170% of the income needed to qualify for the median-priced US home. This is because house prices are lower and interest rates are substantially lower than they were almost a decade ago.

Two esoteric but very important financial measures reinforce the conclusions above. Both the price-to-rent ratio and the mortgage debt-to-GDP ratio have fallen precipitously. The price-to-rent ratio is similar to the price-to-earnings ratio for equities, and the higher it is, the more homebuyers are willing to pay up front to receive a flow of future rent payments. At the peak, the price-to-rent ratio was easily 50% above what it averaged between 1983 and 2000. Today it is about 10% above the 1983 to 2000 average level, and almost 30% below the 2006 peak.

The ratio of all debt (most of which is mortgage debt) to GDP has fallen from 100% of GDP to 80% of GDP. Moreover, despite the recent run up in house prices, the mortgage debt-to GDP ratio has continued to decline. This reflects a return to prudent lending standards and reduced household leverage.

Collectively the improvement in these ratios strongly suggest that we are not in the midst of a credit-induced lending bubble. In addition, housing starts remain about half of what they were during the prior peak. This means that our economy is far less dependent on residential construction activity than it was then.

To review, while house prices are up, inflation-adjusted prices are still years away from their peak levels. In addition, affordability remains high and both the price-to-rent and mortgage debt-to-GDP ratios are much lower than they were.

These four indicators collectively indicate that there is probably no housing bubble, and even if there is one, it is not the result of increased household leverage, which is what primarily precipitated the last housing bust.

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Vickie Lawrence Pacific Northwest Title Company New Affiliate: Miriam Villiard Heritage Builders NW LLC 360 779-1464 miriam@heritagebuildersnw.com www.heritagebuildersnw.com Spike: Ardi Villiard, Heritage Builders NW LLC

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The perfect beginning ...

The National Anthem by Michael Anthony Pratt

B ELFAIR L ICENSING | V ISITOR C ENTER

MAKE A NOTE OF IT UPCOMING EVENTS

Business Breakfast Featuring Gerry Cummings, Coffee News 7:30 – 9:00 a.m.

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Union River Grille, Belfair

2015 CHAMBER ROYALTY MEMBER OF THE YEAR Kim Haack, Kitsap Bank

After Hours Event Vista Financial Solutions 5 – 7:00 p.m.

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O F

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FRIDAY, MARCH 4

It was an exciting night at Alderbrook Resort & Spa as the Chamber crowned its 2015 royalty and celebrated another fabulous year. More than 150 people turned out for the annual Red & White event, complete with a “Hot Stuff Auction” which raised $6,100 for chamber works throughout the year.

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26

| March 2016 |

PHOTO COURTESY SLIPPERY PIG BREWERY

Musician Chebon Tiger and his band Chenonaroo play at the Slippery Pig Brewery in Poulsbo in November at an event that collected donations for North Kitsap Fishline’s food bank.

Under pressure: Bill addresses tactics over music licensing fees ■ Venue owners say harassment by agency reps needs to be reined in

By Tim Kelly

tim.kelly@kitsapsun.com 360-792-3359

When Slippery Pig Brewery transformed from a farmstand operation to a full-scale brewpub in downtown Poulsbo, owner and brewmaster Dave Lambert wanted his new space to be a friendly venue for local bands.

Not everything about creating a live music scene has been friendly, however. Turns out that providing opportunities for local musicians to get some exposure also exposed Lambert to the bane of many restaurant/bar owners — the music licensing agencies BMI, ASCAP and SESAC. His first encounter, with a BMI (Broadcast Music Inc.) representative, came soon after Slippery Pig opened its doors in the summer of 2014.

“It didn’t go well; they don’t hire polite people,” he said, describing the BMI rep trying to collect licensing fees as “pushy, rude, overly aggressive.”

He also objects to how much small businesses in a market like Kitsap are expected to pay.

“We’re never going be the Showbox in Seattle, but we’re being charged based on venues like that,” Lambert said.

Other restaurant/bar owners

describe similar experiences, including harassing phone calls and letters threatening lawsuits; some liken it to a “shakedown.”

“It feels very much like harassment,” said Arnie Sturham, who owns Treehouse Café on Bainbridge Island. “I’m not saying there’s not a reason for these organizations, but to have this kind of an element within the music business is unfortunate.”

The element that small business owners find objectionable is the seeming mercenary-style approach of the representatives hired by BMI, ASCAP or SESAC to pressure small business owners.

That’s why a state legislator is sponsoring a bill that would provide such businesses “relief from harassment and intimidation” by agents of those companies, known in the music industry as “performance rights organizations.”

“Small businesses are being unfairly targeted by out-of-state licensing companies. No one is trying to cheat anyone out of fees they’re due, but the harassment and intimidation is unnecessary and needs to stop,” Rep. Kevin Van De Wege (D-Sequim) said in a recent update on House Bill 1763 posted on his legislative website.

Van De Wege first introduced the bill in the 2015 legislative ses-

sion, and it passed the House but stalled in a Senate committee and was not referred for a full Senate vote. Van De Wege said the music licensing agencies hired lobbyists to oppose the bill.

This year the House passed the bill again, and in late February it was passed out of the Senate Commerce & Labor committee, but with amendments, so if it’s approved by the Senate the bill would have to be reconciled with the House version.

According to Van De Wege’s website, the bill “requires music licensing companies to file annually with the Secretary of State, complete a business license application, and pay an annual fee.

That fee will be used to communicate with bars, restaurants, and other venues to ensure they know their rights when dealing with music licensing agents.”

It’s not a high-profile bill in a Legislature facing major budget issues such as a court order to meet school funding requirements, and prospects for the bill’s passage before the session ends March 10 remain uncertain. However, business owners subjected to the questionable tactics of licensing agency reps welcome some attention to the issue.

“I’m behind this bill simply becauseitbringsitintothespotlight,”

Lambert said. “I don’t think it’s the best possible bill, … but anybody I’vehadthis conversationwithhas no idea that these companies are doing what they’re doing.”

That was echoed by Slaughter County Brewing Co. owner Scott Kirvan, who recently decided to discontinue having bands play at his Port Orchard pub.

“The community doesn’t understand why we stopped having live music,” Kirvan said. He added that for a bar like his — which like most places in the area doesn’t havea cover charge —to be able to afford the potential licensing fees he faced, he would have to charge the musicians to play there.

John Nesby, owner of Greenlight Diner across the street from Slippery Pig Brewery in Poulsbo, faced a similar dilemma when he and his wife operated Mor Mor bistro before its transformation to the diner two years ago. The restaurateur said about eight years ago there was a violin-piano duo that occasionally played on weekends at the bistro, performing mostly traditional Celtic music.

“At that point we were approached by BMI about having live music, and I was shocked they would even know that,” Nesby said. “I wasn’t very educated on things then, and BMI sold me on a contract for $800 (a year) and said

it would cover me for live music.”

By comparison, a test registration on BMI’s website currently shows a $366 annual licensing fee for a restaurant or bar that hosts live music no more than three nights a week (and has no other copyrighted music uses such as karaoke, jukebox, etc.) and has a seating capacity of 65.

ASCAP (American Society Of Composers, Authors And Publishers) does not offer online registration, but a downloadable application shows the annual fee, depending on frequency of performances, is $4.50 to $5.95 per occupant based on the maximum allowable occupancy of the venue, not the seating capacity. That works out to about $320 a year for a maximum occupancy of 65 and bands playing 2-4 nights a week.

Nashville-based SESAC would charge a restaurant or bar with max occupancy under 100 and music three or four nights a week an annual licensing fee of $666.

It’s important to note, however, that those rates are for businesses that self-register, and small independent establishments may not be aware of music licensing requirements until the agency reps start leaning on them for being out of compliance.

In that situation, Lambert said, what a business pays “is completely negotiable after they threaten enough times.”

Nesby said he was able to negotiate his BMI renewals down to about $400 a year, but after signing his original BMI contract he also got demands to pay licensing fees to ASCAP and SESAC. He was dismayed at possibly having to pay $2,000 or more a year “just to have a couple local musicians come in once in awhile,” Nesby said. “And my frustration was boiling over because they’re not easy to work with; they started sending dark, threatening letters about lawsuits and stuff.”

So with the change to Greenlight Diner, the owners decided to forgo any live music to avoid the cost and the hassle.

“From a business owner standpoint, it took a lot of the joy out of trying to support local musicians,” Nesby said.

Sturham said he got frustrated over continual increases in payment demands after he signed a See MUSIC, 28

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K P B J

C H A M B E R

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C O M M E R C E

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| March 2016 |

REGION’S ECONOMY | KATHY COCUS

Relationship building and matchmaking – PTAC style

M

arch 10 from 7 a.m. to 4 p.m. at the Puyallup Fairgrounds is your opportunity to meet and interact with likeminded government contractors as well as with government agencies. Alliance Northwest is the largest B2G (business to government) conference in the Pacific Northwest. This event is coordinated by Washington PTAC and Kitsap Economic Development Alliance (KEDA) is pleased to be affiliated as a Washington PTAC sub-center.

The event starts the evening before with an optional (and additional fee) networking opportunity. You can register for both the networking event and Alliance Northwest at www.alliancenorthwest.org. The website also lists the agenda, details the

breakout sessions (workshops) and the exhibitors. Note: Veterans and veteran-owned small businesses receive 50 percent off all new attendee registrations. Use promo code VETBOSS at the online checkout.

Lunch keynote speakers are Kenyata Wesley, acting director, Office of Small Business Programs, Department of Defense; and Emily Harman, Director of Small Business Programs, Department of the Navy. Wesley is responsible for the oversight of DoD Small Business Programs and Policy to include, SBIR/STTR, Rapid Innovation Fund, Mentor Protégé, STEM, Small Business workforce reshaping, as well as Outreach, and Indian Incentive Programs.

Harman serves as chief advisor to the Secretary of the Navy on

Local firms working on electric ferry plans

By Ed Friedrich efriedrich@kitsapsun.com 360-475-3792

Bremerton firms are developing concepts for possibly the first plug-in ferry in America.

EESImarine is tackling battery banks and the electrical system, and Art Anderson Associates is responsible for initial design concepts and mechanical systems for a boat that might someday sail between Anacortes and Guemes Island.

Skagit County needs to replace the 36-year-old Guemes before long and is exploring battery power.

County commissioners Dec. 29 authorized working with Art Anderson on an all-electric ferry feasibility study.

The hurdle now is fund-

ing. The state’s Clean Energy Fund, issuing grants to research, develop and demonstrate clean energy technologies, appeared to be a promising source.

“That was one where we could get a pretty good chunk of money, and this exact type of project is what they’re looking for,” Joe Payne of EESImarine said. “We have to have (nonstate) matching funds by the end of (February), so it doesn’t look hopeful.”

A 28-car, double-ended EZE (electric zero emissions) ferry would cost an estimated $10.5 million, about $600,000 more than a traditional diesel boat, Payne said. It would save $170,000 a year in operating costs, paying for itself in less than five years. So why are there no electric ferries already?

all small business matters. She is responsible for small business acquisition and strategic initiatives.

KEDA’s own PTAC counselors, Mary Jo Juarez and Mona Carlson, will be there to present a workshop titled “You won a contract, now what?” Other workshop topics include “How to use the debriefing process,” “Doing business with the Hanford primes,” “Financial discipline for government contractors,” “Federal contracting – a legal update,” and “Leveraging your certification.” See the event website for a complete list of workshops.

In addition to the keynote speakers, workshops and booths, matchmaking sessions are also an opportunity to begin or build on relationships with buyers. Matchmaking with government buyers and prime contractors will be short, one-on-one meetings. You must sign up in advance for an opportunity to meet the more

“Everybody’s worried about something new,” Payne said, and only in the past few years has sufficient power been packed into smaller batteries.

There’s one all-electric ferry in the world, in fact.

The 120-car Ampere began operating last year in Norway.

The five-eighths-mile Anacortes-Guemes route is perfect for a pilot project to prove the concept, said Payne, a retired Navy captain who worked for marine engineering firms, including Art Anderson, before starting his own consulting business two years ago.

The proposed ferry, though no detailed design has been completed, would be 150 feet long and 50 feet wide. A six-hour overnight charge would keep it running the next day — 23 to 26 round trips.

Besides costing less to propel, a battery-powered all-electric ferry would require less maintenance.

than 20 matchmaking hosts (first come, first served — or perhaps we should say first matched). You will also have an opportunity to meet with buyers and contractors at their booths.

Exhibitors include: • Absher Construction • CH2M Hill Plateau Remediation • Contrack Watts • FEMA • FLIR Systems • Pacific NW National Laboratory • Port of Tacoma • Sound Transit • RAPIDGate • King County • Naval Facilities NW (NAVFAC) • Naval Ship Supply Systems Command (NAVSUP) • Naval Undersea Warfare Center Division Keyport (NAVSEA) • US Army Corps of Engineers, Walla Walla

• US General Services Administration (GSA) • Washington State Department of Transportation I hope to see you at 2016 Alliance Northwest in Puyallup on March 10. Look for your KEDA PTACersattheWashingtonPTAC booth, on the floor introducing clients to folks we know that you should know and in the sessions.

Watch for details on KEDA’s second annual “Meet the Buyers” event this summer — it will be another opportunity to spread the word on your company and learn about new opportunities.

Go meet new people, strengthen relationships and learn something new — it’s all good!

• Kathy Cocus is director of business development for the Kitsap Economic Development Alliance.

1000 Full-Color Brochures $ 18995

Printed from your digital files. Includes printing and folding. Graphic services available.

Owner Brad Potter, printing superhero since 1981

K P B J C H A M B E R O F

Appreciation Day

A N D I N F O R M AT I O N A L FA I R 11:00 AM – 4:00 PM AT KITSAP SUN PAVILION 1200 Fairgrounds Rd. NW Bremerton, WA 98311 (Kitsap County Fairgrounds)

LIVE ENTERTAINMENT CHILDREN’S ACTIVITIES MINI BOOT CAMP FOR KIDS FREE DOOR PRIZES FOR MILITARY PERSONNEL (ID Required) LEARN WHAT KITSAP HAS TO OFFER LOCAL BUSINESS INFORMATION FREE FOOD & DRINKS (NON-ALCOHOLIC) CENTER STAGE PERFORMERS SPONSORED BY

P A R T N E R

April 16, 2016

C O M M E R C E

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Promoting Business & Encouraging Community in South Kitsap Since 1890

THANK YOU TO OUR SPONSORS!

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UPCOMING EVENTS

In the Fall of 2016 the voters of Kitsap County may be asked to vote to approve funding for new Passenger Only Ferry service between Kitsap County and Downtown Sea le.

July 13, 2016 McCormick Woods

C H A M B E R

2/10/2016 11:00 am â&#x20AC;&#x201C; 1:00 pm

Register now to join us for the 5th Annual SK Golf Classic. 1 pm Shotgun Start begins a great day of golf and fun in the McCormick Woods Sun! To Register or sign up as a sponsor visit www.portorchard.com

Saturday, May 28th 2016 Fes vi es KickoďŹ&#x20AC; at Noon Come enjoy tasty â&#x20AC;&#x153;Seagull Wingsâ&#x20AC;? made by local Restaurants as well as enjoy World Famous Seagull Calling!

For more informa on call the Chamber oďŹ&#x192;ce at 360-876-3505 www.portorchard.com

Join us on March 17th for a St. Patrickâ&#x20AC;&#x2122;s Day Aďż˝er-hours. This month the aďż˝er hours is cohosted by Curves-Jenny Craig, Inner Wisdom Wellness Studio and Peninsula Community Health Services.

Food, fun and door prizes along with great networking. Bring your business cards and plan on mee ng some new businesses

1950 Po ery Ave, Port Orchard

1014 Bay St #3 Port Orchard, WA 98367

Kitsap Bank Harrison Medical Center / CHI Franciscan Health Fred Meyer Air Masterâ&#x20AC;&#x2122;s Hea ng & Cooling Miller Woodlawn Memorial Park

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My Prin ng Services Southard, Beckham Atwater & Berry CPA, PS

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Sponsored by:

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Peterson & Jake CPA Kitsap Sun

Get in the KNOW, www.portorchard.com 360.876.3505

360-876-3505

P A R T N E R

March 17, 2016 5:00 pm â&#x20AC;&#x201C; 6:30 pm

28th Annual Seagull Calling Fes val & â&#x20AC;&#x153;Wingsâ&#x20AC;? Cook-OďŹ&#x20AC;

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C O M M E R C E

You can register online at www.portorchard.com

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John Clauson, the Execu ve Director for Kitsap Transit will be speaking this month on the proposal for new service. He will provide a high level outline of the plan and be available to answer ques ons.

This is an important issue that aďŹ&#x20AC;ects all of Kitsap County so mark your calendars and plan on a ending!

K P B J

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The catalyst for business prosperity, connection, and opportunity.

Sex Trafficking is not just an international issue. It is alarmingly local. Kitsap County has its own story of modern slavery of young girls and women—it’s happening right now because of the opportunistic felons of our otherwise proud community.

Join Shannon Bruce, Executive Coach and Excell Puget Sound Kitsap Group Leader, as she facilitates a panel discussion on this disturbing trend. The panelists each have expertise in current efforts to protect our local youth and women. This is not somebody else’s problem—it belongs to us all. And you can help.

MAR 2

MAR 9

Business Luncheon: Sex Trafficking Speaker - Shannon Bruce 11:30 - 1pm at Gateway Fellowship

MAR 17

Business After Hours

MAR 24

Ribbon Cutting: HiLine Homes

C O M M E R C E

HiLine Homes - Poulsbo Join us at 5:15pm for a ribbon cutting!

5:00 - 7pm at HiLine Homes

P A R T N E R

March 9, 2016 Promptly @ 11:30AM-1:00PM at Gateway Fellowship 18901 8th Avenue NE, Poulsbo, WA 98370 Reserve Your Lunch www.poulsbochamber.com Or Call: 360.779.4848 Sponsored by: February Luncheon. Photo courtesy of P5 Photography

JOIN NOW! ®

O F

Poulsbo Library - Kitsap Regional Library Join us for a St. Patrick’s Day celebration with libations and hors-d’oeuvres at the library!

5:00 - 7pm at the Poulsbo Library

Opening by: Sheriff Gary Simpson, Kitsap County Sherriff’s Office Panelists: Del Chittim, Rescue Freedom International Randy Plumb, Bremerton Police Natalie Mays, Prosecuting Attorney’s Office Jo Lembo, Shared Hope International Victoria Ahlfors, Scarlet Road Mar Brettman, BEST—Businesses Ending Slavery & Trafficking

Business U: Employment and Labor Law Speaker - James McCanna, JD 7:30 - 9am at the Poulsbo Chamber

C H A M B E R

Sex Trafficking: Behind Closed Doors in Kitsap

K P B J

Events Calendar

March Luncheon

Interested in becoming a member of the Poulsbo Chamber of Commerce?

Call us today at: (360) 779-4999 or go to www.pouslbochamber.com

36

| March 2016 |

TECHNOLOGY | CHARLES KEATING

Disruptive innovation in education

A

s West Sound Technology Association (WSTA), a nonprofit educational and member-based organization, we have since 2000 led on the topics of education and the technology economy. With our sponsors, members and partners, we supported and advocated for STEM (Science, Technology, Engineering, and Math) and computer science to count towards graduation.

Our annual summits often share lessons and examples of best practices for adapting to our increasingly innovative information-centric economy. When we first heard of and promoted the first Hour of Code in our region, I was surprised to learn from Code.org’s founder (at its Microsoft kickoff) that there were fewer computer science students in 2013 than in 2000. Several of our Western Washington Summit events crystalized the need for new educational opportunities, and we knew we needed to do something more than our existing policy, peer-to-peer, and community “technology as a tool” forums. The CoderDojo movement was the right model at just the right time.

CoderDojo as an Innovative Disruptor In May 2015 when we launched West Sound CoderDojo, we knew we were on to something. A hundred students and parents packed Bainbridge Public Library so they and their children could be

Transit from 32

The propane tank had to be increased to 2,000 gallons from 500 gallons. It requires a larger fuel pad to meet fire code. The total cost is estimated at $80,000.

When the base was being designed, Kitsap Transit had no propane vehicles. Now it has several, with more on the way.

PHOTO COURTESY WEST SOUND TECHNOLOGY ASSOCIATION

Parents and mentors work with students at a CoderDojo session at Western Washington University Center at Olympic College in Poulsbo.

inspired to learn to code for free.

Leveraging numerous online resources found at Code.org (many which are also free) and bringing together students, parents and experienced mentors — something magicalhappens.Thecommonlabel used is that we teach computer programming or coding, but the realityismoreaboutcollaborating, using code to problem-solve, and what, in essence, is called computational thinking. This is the beginning of a paradigm shift in educationthatalsoleadstochange in an innovation- and technologybased economy.

At our central location, Western Washington University Center at Olympic College in Poulsbo, we host CoderDojo sessions on most Saturdays from 10:30 a.m. to 12:30 p.m. Kids bring laptops or computers they built (Kano), and along with parents, dig in with projects based on Scratch, Python, JavaScript, Minecraft or one of dozens of other tools.

CoderDojos are always free, volunteer- and mentor-led endeavors that require the blending of disciplines — reading, writing, Last year it bought two propanepowered pickups and five buses.

Eight more buses will be arriving soon, said Hayward Seymore, vehicle and facilities maintenance director. The board approved two more pickups for maintenance crews last week. The agency’s goal is to replace two-thirds of the Access fleet with propane buses.

The bus wash vehicle lift wasn’t planned to be installed now, but a late grant made it

science, art and mathematics. Attendees come in at all skill levels.

The Role of Creativity and the A in STEAM Art projects are not simply about painting between the lines.

Likewise, students choose what they want to work on, analyze problems, break them down, and understand the resources and tools to come up with solution — all in an open environment with peers where exchanging ideas, teamwork and using tools are highly encouraged. We have sample projects and tutorials, even Coursera courseware, but students launch from there. Our CoderDojo holistically incorporates the human element with computational thinking, solving problems together. Some may eventually enter careers in programming and others may become entrepreneurs and business owners, but we strive to imbue everyone with the desire to seek solutions, apply tools and explore irrespective of their career aspirations and choices.

For example, in one CoderDojo possible. The lift, where buses are raised and the undersides cleaned, requires the wash bay foundation to be reinforced.

“There are changes, and we want them, but they’re adding days,” Lille said. “We want the project to continue and get done faster so we can get in there this year if possible and not next. Every day we save it saves the taxpayer dollars.”

class last year, Minecraft was the topic of the day and we encouraged students to present their demos and what they’d learned. A handful of parents wondered why we were “playing games,” but the benefit became readily apparent.

Once one student decided to step forward, others were also emboldened to showcase their work in front of the group. In addition to the skill to create and think through their project, it was also an example of how leadership and presentation skills are developed.

A day after the Minecraft CoderDojo, my 11-year old daughter came to me with a problem. She had already constructed a multistory house that was now flooding with water. We navigated to the roof where the pool she constructedtherehadsprungaleak.Aquick patch job later and she was off to building more, but I was amazed by how much she had learned and resolvedissuesbeforeseekinghelp to resolve them.

With creativity, one thing is not the whole path, just a stepping stone. A few days ago, she published her first book and it’s being sold on Amazon, and libraries and book stores are carrying it. We don’t know what’s next, but it’s clear today’s environment is ripe with opportunities for our next generations and many more to come. When Microsoft purchased Minecraft for $2.5 billion in 2014, I thought that was quite a chunk of change to pay for a 3D virtual reality game environment with curiously pixelated graphics.

Now I get it.

Many regions and nations struggle to create successful entrepreneurial environments.

Most want to grow or expand tech sectors with high-wage jobs, but do not know the way forward. Creativity and risk-taking are needed. Entrepreneurs are

encouraged to build it fast, fail, and learn from successes and mistakes. It’s important to note that the tech economy follows the workforce and where it feels welcome. Thus, while we can import talent, students need skills and opportunities in order for us to build a sustainable future.

Greens

chipotle dressing, started off a bit spicy.

“The first day we made it, it was like drinking a glass of scotch,” she said. The toned-down version on the menu is the shop’s early best-seller.

Fredricksen’s initial goal is to sell 60 salads per day — her projected break-even point. If the drive-thru salad concept really takes root, she hopes to open a chain of Greens On Your Way.

from 34

salad can be ordered wrapped in a tortilla for munching on the go.

Soups might join the menu down the road.

Fredricksen spent months testing and tasting recipes at home before choosing her salad lineup.

The Southern Belle, topped with black beans, salsa, cilantro and

A New Regional Status By the time you read this, we will have inked a relationship with CoderDojo HQ in Ireland to become Washington state’s first formally recognized Licensed Regional Body. This new status provides us with additional exposure and a geographical infrastructure for supporting and promoting the global aims and operations of CoderDojos in the West Sound region.

Partners like Lockheed Martin, DT Micro and WWU/Olympic College join individuals and mentors who know we need to do more. Our vision is to launch dojos in libraries, other schools and clubs, and to train teachers who are otherwise resistant to teaching students given their discomfort and lack of familiarity with coding. As we undertake this bold but exciting effort, we need your support and involvement. If you’re curious and want to know more, nothing beats showing up at one of our CoderDojos and seeing it in action. See you soon!

• 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).

K P B J C H A M B E R O F C O M M E R C E

May 11th 7:00 - 9:00 p.m.

Bremerton Central Lions Charitable Founda�on Ambassador Scholarship Awards

May 13th 7:30 a.m. & 1:00 p.m. Shotgun starts Pepsi Armed Forces Golf Tournament May 21st 7:00 - 10:00 a.m.

Bremerton Lions Club Pancake Breakfast May 21st 7:30 a.m.

Contact the Bremerton Chamber of Commerce for more informa�on

May 21st 10:00 a.m. - 1:00 p.m.

68th Armed Forces Day Parade May 21st 11:00 a.m. - 1:00 p.m.

Heroes Barbecue May 21st 6:00 - 9:00 p.m.

Navy League Gala

5K Run 360.479.3579 or staff@bremertonchamber.org

P A R T N E R

May 7th 10:00 a.m. - 2:00 p.m.

Culinary Arts Compe��on

38

| March 2016 |

BUSINESS COMMENTARY | DON BRUNELL

Costs killing animal-waste power

C

onverting animal poop to power makes sense, but today it is too expensive. The good news is it reducesgreenhouse gasemissionsand curtails odors from farms.

Biomass is an important part of our nation’s effort to generate electricity from renewable sources. However, in Washington, where electric rates are low, it is difficult to make an economic argument for using biomass to solely produce power.

Our state’s forest products companies have burned wood wastes for decades as part of the manufacturing process. It is called co-generation. Pressurized steam is run through power turbines and then used to make paper, lumber and plywood. In fact, during the last recession, our

mills kept afloat by selling their electricity.

In recent years, our state’s farmers also started investing in biomass plants to turn animal dung intoelectricalenergy.Theprocess is complex. Here is how it works.

Digesters are oxygen-free tanks in which micro-organisms break down manure and capture methane that otherwise would be released into the atmosphere as a greenhouse gas.

The biogas from digesters is mostly composed of methane and can be burned to produce electricity or cleaned and pressurized for transport in natural-gas pipelines. Fertilizers are byproducts that farmers can use or sell.

By diverting waste from openair lagoons, digesters limit the potential for spills that can pollute waterways and air contamination. However, that process is expensive. To offset those higher

expenses, state and federal officials have provided grants and guaranteed loans.

Farm Power in Skagit County received $500,000 grants from the state and federal governments and $2.1 million in U.S. Dept. of Agriculture funding to build a plant that generates enough electricity for 500 homes.

Puget Sound Energy invested in Farm Power as a way to achieve the state’s requirement that 15 percent of PSE’s electricity come from renewable sources (other than hydropower) by 2020. However, in recent years costs have slowed further development.

In 2011, University of Vermont professor Qingbin Wang pegged the initial investment at $2 million per farm for equipment and also added that grants and subsidies from government agencies were necessary.

Wang estimated that convert-

ing manure from the 95 million animals in the United States would produce renewable energy equal to 8 billion gallons of gasoline — approximately 1 percent of the nation’s total energy consumption.

Nationally, President Obama is encouraging farmers to build manure digesters and pipe the methane gas to electric generators. According to the White House, agriculture accounts for 36 percent of America’s methane emissions.

In 2014, the President issued a “biogas opportunities road map” with a goal of producing enough power for 1 million homes by 2025. Last year, 70,000 homes got their electricity from farm generators.

The Wall Street Journal reported in February that construction of new farm digesters has slowed sharply over the past two years.

Some big meatpackers that have supported development of digesters have become more cautious.

WJS reported Perdue Farms Inc., among the largest U.S. chicken processors, has pledged

to contribute poultry waste to a planned Maryland biogas project, but the company has rejected several other manure-to-energy proposals. “With today’s fossil fuel prices, many such projects can’t stand on their own,” said Mike Phillips, director of special projects for Perdue AgriBusiness.

In Wisconsin, some dairy farmers are not only scrapping plans for new manure-to-power plants but are shutting down existing ones. Higher-than-expected maintenance costs also make those systems less economical.

Just as the costs to generate electricity from wind turbines and solar power have come down, hopefully manure biogas power plants will be less expensive to build and operate in the years ahead. The environmental benefits alone make it worth pursuing.

Don C. Brunell is a business analyst, writer and columnist. He retired as president of the Association of Washington Business, and now lives in Vancouver. He can be contacted at theBrunells@msn. com.

Oregon approves landmark minimum wage increase ■ Phased-in measure will set tiered

wage for different areas of state

By Kristena Hansen Associated Press

SALEM, Ore. (AP) — Oregon lawmakers have approved landmark legislation that propels the state’s minimum wage for all workers to the highest rank in the U.S., and does so through an unparalleled tiered system based on geography.

The state House of Representatives recently passed Senate Bill 1532.DemocraticGov.KateBrown said ishe will sign it into law.

The move makes Oregon a trailblazer in the broader debate about minimum wage unfolding nationwide as the federal threshold remains unchanged from Great Recession levels.

Oregon now joins 14 other states that have raised their rates over the past two years. Another dozen or so are considering taking up the issue this year, either through legislative action or bal-

lot initiative, as issues of wage inequality and middle-class incomes have climbed to the forefront of presidential campaigns

by Democratic candidates Bernie Sanders and Hilary Clinton.

The bill was crafted as a compromise between what unions, businesses and farmers want and as an attempt to thwart more aggressive proposals that could go before voters in November. Those two proposals call for a statewide minimum of $13.50 or $15, and would be phased in over half the time. Labor unions have not yet indicated whether they’ll follow through with ballot initiatives.

Oregon follows moves in states such as Massachusetts, California and Vermont that recently boosted statewide minimums above $10. That stands in stark contrast to more conservative states such as Idaho, which has blocked previous efforts to raise its minimum beyond the federal level, and Ari-

zona, where lawmakers are considering a bill that would block state funding to municipalities that set a local minimum wage.

Oregon’s new plan imposes a series of gradual increases over six years. By 2022, the state’s current $9.25 an hour minimum — already one of the highest in the nation — would climb to $14.75 in metro Portland, $13.50 in smaller cities such as Salem and Eugene, and $12.50 in rural communities.

Those minimums knock Massachusetts — where the statewide rateclimbsto$11anhournextyear — from the top spot, according to the Economic Policy Institute, a D.C.-based think tank that tracks wage laws across the nation.

While there are varying approaches to raising the minimum wage, the three-tiered regional system is uniquely Oregon’s.

States have targeted wage hikes for only government employees or certain industries, as seen recently in New York for fast-food workers, while others allow local jurisdictions to set their own rates above the state threshold,

prompting recent hikes in cities such as Seattle and Los Angeles.

Oregon, however, has made the unprecedented move to be the first state without a one-sizefits-all statewide minimum.

“Oregon has always been at the forefront of new ideas in the country. We were the first to actually have a minimum wage,” said Rep. Paul Holvey, a Democrat from Eugene. “Trust me, we’re not solving all the problems, but we are making a substantial dent in it by pushing up from the bottom some wage equality ... from the huge disparity we have in incomes.”

The state is deeply divided between west and east by economic, cultural and political differences.

The goal of the tiered approach is to balance the needs of the more urban west side — where living costs have soared in rapidly growing Portland — and struggling farming communities in the east.

Division over the minimum wage — currently at $7.25 in federal law — is also often split along party lines and pits low-wage workers against business groups,

as has been seen in Oregon this year. Republicans, the minority party in the Oregon Statehouse, have opposed the increase.

“This enormous increase will force many family farmers to try to find ways to mechanize or transition away from labor-intensive products Oregon is known for, like apples, pears, milk and berries. Unfortunately, some will give up and sell, while others will simply go out of business,” said Barry Bushue, president of Oregon Farm Bureau.

David Cooper, an Economic Policy Institute analyst, said wage increases have never lead to widespread damaging effects, but he also expressed hesitation about Oregon’s regional approach.

“I think any time you create these sorts of somewhat arbitrary geographic districts, that’s when you can create opportunities for some sort of economic disruption,” he said. “I would prefer the whole state got to the same wage level but at a slower pace by region so that everyone is held to the same standard.”

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