PBN May 12, 2023

BY JAMES BESSETTE | Bessette@PBN.com

New SBA lender rules are creating some

BY SAM WOOD | Wood@PBN.com

IMPENDING CHANGES at the U.S. Small Business Administration are stirring up whirlwinds of controversy – in Rhode Island and in Washington, D.C. – as the federal agency adopts new rules that will govern how it runs its lending network.

SBA Administrator Isabella Casillas

FOCUS: SMALL BUSINE SS

Guzman has stated repeatedly that the Biden administration wants to increase lending to small-business owners in underserved communities – specifically to veteran-, women- and SEE

D. Steinberg has never worked as hard as he has over the last 15 years. But he has also enjoyed every moment of it. Steinberg, 69, became the Rhode Island Foundation’s CEO and president in 2008, succeeding Ron Gallo. He had been vice president of development at his alma mater, Brown University. And before that, he worked for about 30 years for the bank that eventually became FleetBoston Financial, ending his tenure as chairman and CEO of Fleet Bank Rhode Island.

HANDING OFF: Neil D. Steinberg has been CEO and president of the Rhode Island Foundation since 2008, but he’s ready to step down at the end of May.

PBN PHOTO/TRACY JENKINS

He helped raise and give out $693M, but outgoing

CEO says work is never done

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FOR STARTERS

TRENDING

Most-read stories on PBN.com, April 2023

1 Sweetgreen opens first R.I. location in Cranston

POSTED ONLINE: APRIL 18

National restaurant chain Sweetgreen Inc. opened its first Rhode Island location. The store, located at 111 Hillside Road in the Garden City Center will have pick-up, delivery and dine-in options. bit.ly/3NoU8Ql

2

Cranston Plan Commission gives initial approval for 130-unit housing development

POSTED ONLINE: APRIL 5

The Cranston Plan Commission unanimously approved the master plan for a 130-unit, mixed-use development with self-storage space on the site of the former Cranston Print Works facility. The applicant, CPW True Storage LLC and CPW Apartments LLC, is proposing to convert the existing mill into a multifamily apartment complex. bit.ly/3LLYAYe

3

PBN announces 2023 Best Places to Work honorees

POSTED ONLINE: APRIL 28

Sixty-seven honorees have been named by Providence Business News for its 2023 Best Places to Work Awards program. bit.ly/3ncNSk1

4

Rhode Island Hospital president to step down amid ‘leadership structural changes’

POSTED ONLINE: APRIL 13

Dr. Saul Weingart has stepped down as president of Rhode Island Hospital and Hasbro Children’s Hospital after more than two years on the job leading the Lifespan Corp.-owned entities. The leadership restructuring includes establishing a new position of chief of hospital operations and president of the hospitals. bit.ly/3Lq8nSj

5

FDIC seeks to ban 3 R.I. financial executives

POSTED ONLINE: APRIL 11

The Federal Deposit Insurance Corp. seeks to ban three Rhode Island financial executives from working in the banking industry.

The agency alleges Robert S. Catanzaro, founder and CEO of Independence Bank of East Greenwich, and Danielle M. Desrosiers, the bank’s former executive vice president, engaged in a pattern of “personal dishonesty” that put the soundness of the financial institution in peril. The agency also claims John C. Ponte, of Ponte Investments LLC, violated regulations and engaged in unsafe or unsound practices. bit.ly/3HxUal1

6 Momentum finally building for R.I. tangible tax exemption

POSTED ONLINE: APRIL 7 bit.ly/41UVgzr

7 CVS Health CEO’s pay increased 5% in 2022 despite opioid settlements

POSTED ONLINE: APRIL 10 bit.ly/41KTIIh

8 Changes in mortgage fee structure may shake up industr y

PUBLISHED IN PRINT: MARCH 3 bit.ly/42fUtsu

9 Former Tarbox Toyota property in North Kingstown sells for $2.6M

POSTED ONLINE: APRIL 6 bit.ly/3ALo6GK

10

Local fishermen charged with evading taxes on millions of dollars in collective income

POSTED ONLINE: APRIL 17 bit.ly/3NwC8n0

COURTESY SWEETGREEN INC.

COURTESY LIFESPAN CORP.

5Q: Mary Noons

President and chief operating officer, Washington Trust Bancorp Inc.

BY NANCY LAVIN | Contributing Writer

1

What significance does it hold for you, personally and professionally, to be Washington Trust’s first female president and COO in company history?

I am truly honored. There have been many highly skilled, competent and successful women at Washington Trust. I feel fortunate, but I know I won’t be the last because we have incredible talent here.

of contacts in that business. So, our challenges will be driven by inventory concerns in our market area. The lack of building over the past 10-12 years has resulted in a genuine lack of home supply for which there is no easy or quick resolution.

2

Has your gender been an obstacle or source of discrimination in work within the maledominated banking world?

For the past 30 years, I have been extremely fortunate to work in a forwardthinking company that truly cares about their employees and values their contributions. I personally have never suffered systemic discrimination or felt I was denied or overlooked for advancement because of my gender.

4Local banks, including Washington Trust, are expanding outside of Rhode Island with branches and loan offices, etc. Why is it important to have a physical presence in the communities you serve?

When something significant happens in your life, you want someone you can depend on and trust, so having a local branch or loan office that our customers can walk into and meet with a person to help them is important.

5How is the bank preparing for a potential economic downturn this year?

3

How does your expertise in mortgage banking inform your goals and strategies in your new role? What do you see as the biggest challenges to growing Washington Trust’s mortgage banking sector in the year ahead?

Our success in mortgage involved reexamining our process, removing any nonessential steps that did not add value to the customer, and empowering employees to enhance and change tasks. Regarding the challenges in the mortgage industry … we have been purchase-market-focused for decades and have a well-established network

We have very good communications with our customers and have always been there, able to provide solutions for those affected by market downturns. We do the things that make sense and help our customers to prosper in the long run. This disciplined approach also applies to how we manage the bank. We do not chase fads or take undue risk. n

PBN PHOTO/ELIZABETH GRAHAM

We do the things that make sense and help our customers to prosper.

WHILE MOST OF THE staffing issues endured by the restaurant and food service industry in Rhode Island have improved, there continue to be labor shortages. Vacancies take longer to fill, workers calling out create short-term hardships and there is still a lack of up-and-coming employees.

Business owners from chefs to human resource directors are looking for any avenue to attract workers.

Students with little to no employment experience received an opportunity to have a seat at the hiring table when they were invited to attend the daylong Rhode Island High School Hospitality Student Career Conference held by the Rhode Island Hospitality Education Foundation on April 5 at the Providence Marriott Downtown. Participating schools included the Warwick Area Career & Technical Center, Woonsocket Area Career and Technical Center, Chariho Career & Technical Center, Exeter Job Corps Center, and the Cranston Area Career and Technical Center.

These schools competed earlier in the spring in the national ProStart culinary and management skills scholarship challenge. This time, they were there to meet with and learn from local industry professionals.

“One of the education foundation’s main goals is to prepare Rhode Island’s next generation of hospitality industry influencers for life after school,” said Heather Singleton, chief operating officer of the foundation.

Traci Dufresne, director of hospitality and education, said students and professionals alike left feeling invigorated and inspired.

Following the ProStart competition in recent years, some of the judges

DINING OUT | BRUCE NEWBURY

Restaurant farm system

adapted and adopted some of the dishes that the students had competed with on their menus. For example, Jennifer Luxmoore of Providence’s Sin Bakery put a grapefruit tart created by a student team on her menu. Her customers loved it so much that she ended up keeping it on the menu for the entire month of April and it is still available.

As of May 22, Newport Restaurant Group’s Avvio restaurant is spotlighting a veal chop created by the Exeter Job Corps team. It was clear to the industry professionals the potential and the talent was there to be cultivated. Advantage to the savvy employers who recognize this potential.

That was the simple idea of the career conference. A distinguished panel was co-chaired by Joanna Arrighie, area director of sales and marketing at Meyer Jabara Hotels, and Tom Riel, senior vice president at the Providence Warwick Convention

It was the culinary equivalent of being scouted by the pros on the athletic field.

& Visitors Bureau. More than 100 students heard from panelists discussing their pathways to success. They included chef Robert Andreozzi from Pizza Marvin, a 2023 James Beardnominated chef, and Kim Paquette, Omni Providence Hotel director of associate services.

A breakout success story was told by sous chef Cameron Vicente. He was in the ProStart competition during his senior year in high school. He was approached by Newport Restaurant Group at the competition. The restaurateurs were so impressed with Vicente’s skill that they put him on a career track. He is now in the kitchen of their restaurant Trio in Narragan-

sett. It was the culinary equivalent of being scouted by the pros on the athletic field.

At the career conference, employers conducted on-the-spot interviews, allowing students to be introduced to hiring professionals and go through the basics of interviewing.

“I’ve been connecting students with professionals constantly since the event ended,” Dufresne said. “We’re already planning the next one!” n “Dining Out With Bruce Newbury,” syndicated weekly on radio, can be heard in Rhode Island, Connecticut, Vermont and Indiana. Contact Bruce at bruce@brucenewbury.com.

CAREER PATHWAYS: Hospitality and food service industry professionals discuss their career pathways at the Rhode Island High School Hospitality Student Career Conference. They are, from left: Trio sous chef Cameron Vicente, Omni Providence Hotel Director of Associate Services Kim Paquette, Kin Southern Table + Bar owner Julia Broome and Pizza Marvin owner Robert Andreozzi.

COURTESY RHODE ISLAND HOSPITALITY EDUCATION FOUNDATION

FOR STARTERS

BETTER OPTIONS: After discovering food allergies in her dogs and wanting better options for them, Christine Karouz opened Power Pup Treats LLC, a dog bakery business in East Providence.

Healthy canine treats

BY CLAUDIA CHIAPPA | Chiappa@PBN.com

FOR YEARS, Christine Karouz did not know her dogs had food allergies. The proud owner of Zeus and Foxy, two bulldog and pit bull mixes, she started noticing they would often manifest skin allergies and intestinal problems after eating.

“Every treat that I was buying, they’d end up with some sort of issues,” Karouz said. “I really started looking into the ingredients and I couldn’t even pronounce half of them.”

It took many veterinary visits and a lot of research, but eventually Karouz realized their nutrition was the problem and she decided she wanted better options for her dogs. That’s how the then-health care worker turned baker and opened Power Pup Treats LLC in April 2022.

Based in East Providence, the dog bakery sells a variety of treat options for dogs, from cookies to doughnuts and cakes, all created with natural ingredients, such as peanut butter, bacon, apple, banana, oat flour and pumpkin.

“I love dogs and being able to make them happy is my favorite part of this job,” Karouz said.

While she mostly sells her products online – reaching customers and their pets all over the country – Karouz also built a loyal customer base in the state by “popping up” at various farmers markets, craft shows, fairs, and by selling her products at certain local stores, including We Be Jammin’ in Warwick. n

Pumping up a print shop

Empty nesters bought it in 2017

BY CLAUDIA CHIAPPA | Chiappa@PBN.com

BUD AND KAREN MCCANN bought Allegra on Valentine’s Day in 2017.

The date is a fun coincidence for the long-married couple, who were looking for a change of pace and a new business adventure when they stumbled upon the Providencebased printing business. While neither had been a businessowner, both had plenty of experience in similar industries: Bud had over 35 years of sales and management experience in a business that made printing equipment, while Karen had a creative arts background.

Eventually, it was Providence that won them over.

“This [business] was the one that fit the nicest and it allowed us to move to Providence, which … was close to family and friends,” said Bud McCann, who grew up in Seekonk. “We also wanted to have a little bit of a of an urban vibe, as we became empty nesters. This was a nice way for us to achieve some personal goals, as well as business.”

That Valentine’s Day marked the beginning of a new chapter for the couple and the beginning of a wave of growth for the business.

Meant to be a “one-stop shop” for all communications needs, Allegra offers a variety of printing options, from flyers and brochures to posters and booklets; mailing services;

OWNERS: Bud and Karen McCann

TYPE OF BUSINESS: Marketing and print communications

and marketing services, including graphic design and promotional products.

Since buying the 50-year-old shop in 2017, the McCanns have quadrupled the revenue and tripled the size of the staff. Of course, it wasn’t all easy. Transitioning from the corporate world to being a business owner brings its own set of challenges, and the McCanns found that out soon enough.

“I’ve always enjoyed working,” Bud McCann said. “But now having your own business, it brought on a lot of different pressures that I didn’t realize were going to happen. So, until I became comfortable, there was clearly stress, but it worked its way out.”

But after an adjustment period, the McCanns found their niche. In particular, they expanded the shop’s relationships with local nonprofits, which now make up 25% of their business. They also invested in new, expensive equipment, which allowed them to expand their services. Now in any given day, there can be more than 150 orders being processed at various levels within the 5,000-square-foot shop, they said.

While Bud splits his time between working with customers and

LOCATION: 102 Waterman St., Providence

EMPLOYEES: Nine

taking care of the administrative side of the business, Karen handles the marketing of Allegra.

“We try to work with small businesses in the Providence and southeastern Mass. region. So, I try to spread the word about successful jobs and campaigns that we’ve done for our customers,” she said. “You don’t have to go to three or four different other small businesses to get your marketing needs done. We can be your one-stop shop.”

While many of Allegra’s clients are small, local businesses, the company has partnered with larger clients too. Recently, it was one of the five businesses selected by Brown University to outsource some of its printing jobs. The university also recognized it in its economic impact report.

As owners of a family-owned business, Bud and Karen McCann have worked to ensure their company is well embedded in the community. They’ve created the Footprint Fund, which awards selected nonprofits thousands of dollars in marketing and printing services. To date, Allegra has donated more than $50,000 to local nonprofit organizations and associations. Another fun community event is the annual “Pie in July,” when Allegra gifts a freshly baked pie to customers throughout the month of July. n

YEAR FOUNDED: 1967

ANNUAL SALES: WND

WAVE OF GROWTH: Since buying Allegra, a full-service printing, mailing and marketing company in Providence, in 2017, Bud and Karen McCann have quadrupled the revenue and tripled the size of the staff of the more than 50-year-old shop.

PBN PHOTO/MICHAEL SALERNO

PBN PHOTO/MICHAEL SALERNO

Political dispute allows inside look

BY SAM WOOD | Wood@PBN.com

A TESTY DISPUTE BETWEEN Gov. Daniel J. McKee and Attorney General Peter F. Neronha has spilled into the open in recent months, but some observers say it’s not unusual for tensions to develop between top elected officials – even from the same political party – and shouldn’t have any lasting effects on the government’s operation.

John Marion, executive director of Common Cause Rhode Island, says it could even be a good thing for the cause of open government.

Neronha, who recently started his final four-year term as attorney general, sought an additional $2 million in his office’s next fiscal budget to hire more prosecutors to handle a backlog of 14,000 cases. Some of the money was intended for defending state agencies and funding more health care and environmental work. He also requested $350,000 to form a cold-case unit.

McKee shot down those requests, releasing a $13.8 billion fiscal 2024 budget proposal in January that levelfunded the R.I. Office of Attorney General

Since then, Neronha – who, like McKee, is a Democrat – has not shied away from expressing his displeasure

with the governor’s decision, turning to social media and news outlets to wage a public relations battle and persuade legislative leaders to boost his allocation.

Typically in Rhode Island – where Democrats control most of the political seats – disputes over budgets are usually hashed out behind closed doors, Marion says.

“The tension between the offices is not unprecedented in any way,” he

said. “What’s new here is an AG who is suddenly aggressive in his use of Twitter to call out the governor for not supporting his budget plans.”

Marion says the kerfuffle is pulling off the veil – at least partially –from what has traditionally been an “internal process” of assembling a multi-billion dollar state budget. “The public is now getting to see some of the real thinking” behind how budget decisions are made, he said.

Early signs of discord came in January when Neronha declined to represent the McKee administration in a legal battle over whether the governor had the power to order the removal of a homeless encampment on the Statehouse lawn. McKee was forced to hire outside counsel, at a reported cost of $70,000.

More recently, Neronha has said publicly that because of his department’s high workload and inadequate

funding, the attorney general’s office may have to decline to represent the state in some lawsuits brought against it, leaving individual agencies to fight their own legal battles.

Furthermore, Neronha has also publicly acknowledged that he and McKee are not on speaking terms, although McKee has maintained that the two have a cordial relationship.

“We have no issue with Neronha’s office,” McKee spokesperson Matthew Sheaff told PBN. “Our office has worked daily with the AG’s office.”

Neronha underwent back surgery on May 5 and wasn’t immediately available for comment.

Marion isn’t concerned that the political struggle could end up throwing a wrench into the state’s governmental works and prove costly for taxpayers. “Ideally, the two are able to work it out in the end,” Marion said.

Indeed, the relationship between Neronha and McKee may sound dysfunctional, but it’s not unusual, according to Joseph Cammarano, a political science professor at Providence College

“It’s common for a state governor and AG not to talk because they’re independently elected,“ Cammarano said. “What you’re seeing is Neronha not accepting the [budget rejection] served up by the governor.” n

‘The public is now getting to see some of the real

JOHN MARION, Common Cause Rhode Island executive director

sights on Providence. The food scene there is incredible, Finocchiaro says.

“Anything craft-made, Providence likes,” she said.

Business permits in hand, they didn’t realize they could only set up the cart in certain places. As a result, they got chased out of their spot near the “Superman” building in Kennedy Plaza.

“It was the end of the summer, and we were going to give up but decided to try around Brown [University] and we sold out in an hour,” Finocchiaro said.

What had been 100 servings of coffee, tea and cold brew a day shot up to 400.

With winter on the horizon, they went looking for a permanent home and partnered with local restaurants and breweries where customers could get nitro cold brew on tap. By the next spring, it was available at dozens of outlets.

In 2018, they set up in their first shop, a cozy, plant-lined, 600-squarefoot shared space with Dash Bicycle, a Providence bike store crammed with cycling gear.

A nitro-fueled success, from coffee cart to cafes

BY SARAH FRANCIS | Contributing Writer

Nitro Bar barista whips up cold brew nitro coffee with the flair of a bartender. He scoops ice into a glass and with the pull of a tap, fills it from a keg of long-steeped coffee injected with nitrogen. The result: a sweetish swirl of brown liquid with microbubbles that float to the top in a Guinness-like foamy head.

Audrey Finocchiaro launched this caffeine-fueled concoction with her partner, Sam Lancaster, when they debuted the Nitro Cart in 2016. Since then, the pair have opened three brickand-mortar coffee houses and their nitro is on tap at more than 60 locations, from the East Bay to Boston.

There’s also assorted Nitro Bar merch, including limited edition blackribbed beanies and 1-pound bags of beans to brew at home.

Some small-business entrepreneurs take a roundabout route before finding their niche. Finocchiaro isn’t one of them. From the time she was a kid growing up in North Kingstown, she knew she was going to be in the food world, she says.

“When I was 6, I had a business called Neighborhood Yummies. I baked

and sold cookies to the neighbors. I couldn’t see myself in any other industry,” she said.

Finocchiaro took a temporary detour in college, studying economics and international business at Marymount Manhattan and interning at fashion houses the Row and Carolina Herrera.

After graduation in 2015, she came back to Rhode Island and worked as a social media manager at Ava Anderson, a company specializing in soaps, skin care and other products.

Shortly after, she and Lancaster, who’ve dated since high school and recently got engaged, were looking around for a project. Using scrap wood that she found in her dad’s basement, and maxing out their $1,500 credit card limit, they constructed a small cart, arrayed with coffee-making equipment.

“I called around to find an event where we could try it out and a farmer in Jamestown who was holding a sheep shearing event told us to come on down,” she said, adding, “we made the coffee three times stronger than it was supposed to be.”

Undaunted by the minor hitch at that first outing, the couple turned their

STEADY GROWTH: Audrey Finocchiaro, co-owner of The Nitro Bar, has taken her coffee business from a simple cart in 2016 to now preparing to open her fourth location in June, in Little Compton. At right is Coffee Director Nick Berry at the Providence shop.

Along with the nitro brew made with Rhody Roaster beans, caffeine lovers can get their fix of caramel and dirty chai lattes or a dirty wafer – two shots of espresso, chocolate and milk. Finocchiaro’s current favorite? Ginger citrus espresso tonic. Everevolving treats created by the inhouse pastry chef include pesto smash bagels and banana trifle pudding.

“We take cinnamon buns very seriously,” Finocchiaro said.

Since then, the couple has opened two more locations in Newport, one on Pond Street and one on Thames Street. They plan to launch a fourth in Little Compton in June, next to Walker’s farm stand where they can take advantage of the fresh fruit for their pastries.

One lingering effect of COVID-19: Customers can now order online and pick up minutes later at the store. Unlike other businesses, though, Finocchiaro says they haven’t been plagued by staffing issues.

“We build positions for people on our team so they can grow with us,” she said. “Sam and I worked in toxic restaurant environments, and we want to create a place where everyone is treated with respect.”

The couple share responsibilities in running the business, with Lancaster handling financials and day-today operations.

“Audrey does more of the marketing,” he said. “She’s the visionary, pushing the business forward. She brings a vibe and energy to the store.”

With days that start as early as 6 a.m., the couple have agreed not to bring work home. He loves surfing, while she’s into yoga and owns a studio with her sister.

As the couple looks toward their 30s, Finocchiaro takes in the view from her days as a first grader selling cookies to the neighbors.

“Sam and I started out with the Nitro Cart using maxed-out credit cards, and this summer we’ll have a team of 60 to 65,” she said. “That’s pretty colorful.” n

PBN PHOTO/TRACY JENKINS

‘She’s the visionary, pushing the business forward. She brings a vibe and energy to the store.’

SAM LANCASTER, The Nitro Bar co-owner

Construction at Metacomet might start soon

BY CLAUDIA CHIAPPA | Chiappa@PBN.com

(Editor’s note: A version of this story was first published on PBN.com on May 5.)

EAST PROVIDENCE – Plans for the redevelopment of the former Metacomet Golf Club are moving forward.

Developer Marshall Properties Inc. has partnered with Northeast Golf Co. to redevelop part of the property into a nine-hole golf course, which will be named Met Links.

Robert McNeil, president of Northeast Golf, said the company is planning to start construction over the summer and potentially open next year. But as it is still working through permitting, the timeline remains tentative.

Marshall Properties said it is “committed to advancing all aspects of the project as soon as possible” and is hoping to develop a detailed timeline in the coming months. In the meantime, the company said it has been continuing to collaborate with the East Providence Waterfront Commission and the city of East Providence, working on “finalizing plans and performing related work.”

Plans to transform the former

Metacomet Golf Club into what Marshall Properties calls a “dynamic mixed-use destination” have been in the works for a few years. Marshall Properties bought the property, a 140-acre expanse off Veterans Memorial Parkway, in October 2020 for $7.6 million.

Since then, redevelopment plans

have been mired in controversy. A group of former club members sued the former owners, including local golf legend Brad Faxon, for selling the club after members already paid a full year’s dues of $3,800 apiece. The members unsuccessfully sought to require the club to remain open for the 2020 season, and the case was

dismissed in October 2020, according to records with the R.I. Superior Court.

Meanwhile, community residents also tried to push back, forming a citizen activist group called Keep Metacomet Green! to try and stop the redevelopment. The group sued the East Providence City Council and the developer after the council approved a requested rezoning for the property in 2021, but later withdrew the lawsuit.

Earlier this year, Providence Business News reported that the developer had yet to submit its project plans to the city. The East Providence Waterfront Commission, which could not be reached for this story, must outline certain design guidelines for the property, which set limits on building heights, materials, traffic flow and other elements. After those guidelines are approved, Marshall can submit an actual project proposal to the city.

Including a nine-hole golf course available for community use was one of the provisions included by the East Providence City Council in the 2021 rezoning, meant to ensure that about half the land remains open space. n

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COURSE OF ACTION: Plans to redevelop the former Metacomet Country Club in East Providence are moving forward, as developer Marshall Properties Inc. has partnered with Northeast Golf Co. to redevelop part of the property into a ninehole golf course that will be named Met Links.

PBN FILE PHOTO

FOR STARTERS | WHAT’S HAPPENING

On the links

THE NORTHERN RHODE ISLAND

Chamber of Commerce’s Women’s Business Council will hold a “Nine & Dine” golfing event, hosted by Kirkbrae Country Club. The event will be a scramble format for nine holes. A luncheon and cocktails will be served. Golf prizes will be announced.

EDITOR’S CHOICE

Motor vehicle association to hold conference May 25

ON THE ROAD: The American Association of Motor Vehicle Administrators will hold its 2023 Region 1 Conference at the R.I. Convention Center on May 25.

FLICKER

THE AMERICAN ASSOCIATION of Motor Vehicle Administrators will hold its 2023 Region 1 Conference, hosted by the R.I. Convention Center. The conference provides an opportunity for you and your peers to discuss issues related to a relevant driver’s license, motor vehicles and law enforcement. The event will also offer networking and interactive learning opportunities for colleagues.

MONDAY, MAY 22, THROUGH THURSDAY, MAY 25. $250/guests; $650/members; $900/nonmembers

R.I. Convention Center, 1 Sabin St., Providence. INFO AND REGISTRATION: bit.ly/3MQOZQO

MONDAY, MAY 15, 11:30 A.M. TO 4 P.M. $200/golfer; $60/lunch only Kirkbrae Country Club, 197 Old River Road, Lincoln.

INFO AND REGISTRATION: bit.ly/3KHyHXx

Just ‘fore’ fun

THE CENTRAL RHODE ISLAND Chamber of Commerce will hold its “Just Fore Fun” golf networking event, hosted by the West Warwick Country Club. The nine-hole tournament will also include lunch, refreshments and an awards program. The field is limited to 52 reservations.

THURSDAY, MAY 18, 9 A.M. TO 2 P.M. $65

West Warwick Country Club, 335 Wakefield St., West Warwick. INFO AND REGISTRATION: bit.ly/3of4U0V

Right ‘choice’

THE SOUTHERN RHODE ISLAND Chamber of Commerce will hold its

annual Chamber Choice Awards ceremony. The event will recognize top businesses and leaders within the community. Hors d’oeuvres and a silent auction will also be offered. Cocktail attire is suggested.

THURSDAY, MAY 18, 5-9 P.M. $65 Theatre By The Sea, 364 Cards Pond Road, South Kingstown.

INFO AND REGISTRATION: bit.ly/40NBZ1M

Springing into education

COLLEGE VISIONS will hold its annual Spring Celebration. The annual fundraiser supporting the educational nonprofit will have music and food in an outdoor setting.

THURSDAY, MAY 18, 6-8 P.M. $25 Casino at Roger Williams Park, 1000 Elmwood Ave., Providence.

INFO AND REGISTRATION: bit.ly/3ADllHu

Being social

THE TRI-TOWN CHAMBER of Commerce will hold a workshop titled “Using Instagram for Your Business in 2023.” The workshop will delve into creating and scheduling content, and how to develop reels and stories that engage audiences. Business owners and marketing and social media specialists are encouraged to attend.

COURTESY

FRIDAY, MAY 19, 11:30 A.M. TO 12:30 P.M. Free Online.

INFO AND REGISTRATION: bit.ly/3mH2bNm

Power hour

ONE SOUTHCOAST CHAMBER of Commerce will hold a Women’s Power Lunch, hosted by Pub 6T5 Bar & Grill. The lunch event will include a group discussion and networking opportunities to build connections. Event is limited to 30 attendees.

FRIDAY, MAY 19, NOON TO 1:30 P.M. Free Pub 6T5 Bar & Grill, 736 Ashley Blvd., New Bedford.

INFO AND REGISTRATION: bit.ly/3GPJBt7

Take the lead

THE CENTRAL RHODE ISLAND

Chamber of Commerce will hold a LEADS Luncheon event, hosted by HarborOne Bank and Sophia’s Tus can Grille. The event invites attend ees to get acquainted with members of the business community and potential customers. Participants will share a “60-second commercial” to help oth ers better understand their business.

THURSDAY, MAY 25, NOON TO 1:30 P.M. $10/members; $25/nonmembers

Sophia’s Tuscan Grille, 1729 Warwick Ave., Warwick.

INFO AND REGISTRATION: centralrichamber.com/events/18050/ leads-luncheon

Business fundamentals

THE SOUTH EASTERN Economic Development Corp., along with the Sharon & Crescent United Credit Union, the U.S. Small Business Administration and Massachusetts Small Business Development Center will hold a workshop about the fundamentals of planning, preparing for and financing a small business.

TUESDAY, MAY 30, 10 A.M. Free Online.

INFO AND REGISTRATION: bit.ly/3KJQZaH

Creating opportunities

HOUSING NETWORK of Rhode Island will hold its annual meeting. The event will celebrate the organization’s accomplishments while continuing its work to expand the state’s supply of affordable homes. The event will

Interested in having your business-related event included in What’s Happening? Contact PBN Researcher James Bessette at (401) 680-4838 or Research@PBN.com.

recognize seven individuals and institutions for efforts in supporting housing. Advanced registration required.

MONDAY, JUNE 5, 5-7:30 P.M. $60 Providence G, 100 Dorrance St., Providence.

INFO AND REGISTRATION: bit.ly/3JXkS7a

WHAT’S HAPPENING | FOR STARTERS

Growth opportunities

GOLDMAN SACHS 10,000 Small Businesses Rhode Island is seeking applications for its fall cohort. The initiative is designed for business

UPCOMING PBN EVENT:

The 2023 Business Women Awards will be held on Thursday, May 25, from noon to 2 p.m. at the Providence Marriott Downtown. For more information, visit PBN.com. For sponsorship opportunities, contact Advertising@PBN.com.

owners who have a business poised for growth. The program looks for applicants who are passionate about growing their business and creating jobs in their communities. The deadline to apply for the cohort is June 15.

MONDAY, SEPT. 11, THROUGH WEDNESDAY, DEC. 13. Free Community College of Rhode Island, 400 East Ave., Warwick.

INFO AND REGISTRATION: ccri.edu/10ksb

Pictured (from left to right): Stacie Collier, Eugenio Fernandez, Jr., David Nastro, Greg Almieda, Keith Kelly, Jill DeShiro, Brian Murphy and Helena Foulkes

Not pictured: Treasurer James Diossa

PHILANTHROPY

STEINBERG

CONTINUED FROM PAGE 1

Steinberg has raised the foundation’s profile, and he’s at ease working rooms filled with state officials and business and nonprofit leaders, drawing attention to major societal issues in the Ocean State. The foundation, under Steinberg’s leadership, also significantly increased its financial portfolio and its giving.

The foundation had $1.3 billion in assets in 2022 and distributed $84 million to 2,400 nonprofits that year – three times the annual giving of the foundation in 2008 to twice as many organizations.

Steinberg says leading the foundation has been “the best job I’ve ever had.” Come June 1, Steinberg’s tenure will conclude with his retirement. David N. Cicilline, a former Providence mayor who also served for 11 years as a congressman, will take over.

“What I will miss is being in the epicenter of being involved in a lot of things,” Steinberg said. “The organization is built on the shoulders of many that came before us. Now, it’s time to hand it off to the next leadership.”

When you look at where the foundation is today, is it what you envisioned it becoming 15 years ago?

The truth is, I did not know much about it when I got here. I knew of it and its history, but I did not really understand what it did. What I saw was a lot of potential. I didn’t walk in and say, “This is what it should be.” I walked in and as I learned more about what the foundation did and what it could do, I saw a lot of potential to raise more money.

I saw a lot of potential to build the endowment and give out more money, and I saw the opportunity for us to play a leadership role in key issues. We then established a mission to be a proactive community and philanthropic leader to meet the needs of all the people in Rhode Island.

The foundation, under your direction, saw its total assets more than triple in size since 2008. How did that happen?

The way we grew [the assets] was we raised more money and having good investment performance over the years. Our investment performance over 20 years is 8.1% annualized. Put that

A STEADY CLIMB

In the 15-plus years Neil D. Steinberg has led the Rhode Island Foundation, the nonprofit funder’s annual grant distributions and total assets have tripled over time.

in with the money we raised over the years, that is how it grows.

Was getting the foundation to be a bigger player financially in community building an original goal of yours, or did it happen organically?

[Being a bigger player] was the intent. I saw the potential to do it. Most importantly, the state needs it. We saw the needs of the state. When people say, how do we decide on tackling education, health care, economic security, those are big needs in the state.

How did you get more donors involved?

We just upped the game and talked to more people across the board. [My experience at] Brown and FleetBoston, those were the building blocks. I knew business. I knew community. I can bring those contacts in and network. Combine all that with a very talented staff here … we’re going to raise more money.

You have to raise it because people believe in you and they trust in the institution, and we can help fulfill what they want. We’re here to say we make the donors’ dreams come true.

Have you achieved all or at least most of what you wanted?

You never get there. You always want to do more. Have we become a much bigger player and a leader in the state? Yes. But there’s always more to do, which is the purpose of a community foundation.

What would you say has been the foundation’s greatest achievement under your leadership?

We did the “Make It Happen” initiative in 2012. That was transformational for us; it was a brainstorming session with 300 people from businesses and nonprofits at the R.I. Convention Center.

‘SUPERMAN’ REBIRTH? The Rhode Island Foundation has agreed to provide a $15 million bridge loan to help get the Industrial Trust Co. Building redeveloped because it is key to revitalizing downtown Providence.

We decided to lead what we thought was a void and a need in the state for long-term planning for education and health. Three years ago, we started long-term education and health planning, creating plans that were put into place with the R.I. Department of Education, and [then-Gov. Gina M.] Raimondo signed the executive order. This group still meets to convene leaders in the community to do work.

We had our 100th anniversary in 2016 and we raised a special $10 million to resurrect Roger Williams Park for park improvements and an endowment for park conservancy. COVID-19 certainly was a big crisis and we stepped up and raised a lot of money to meet the needs in the community. It can be hard for the community to measure the success of all the campaigns the Rhode Island Foundation has initiated, relative to the investments in money and time. How does the foundation ensure it is getting bang for its investment buck?

It’s a combination of science and art. A lot of it is about balance. We balance across sectors and we balance demographically. We always tell people, “We can do anything, but not everything.”

That’s where the trick of the measurement is. It’s helping and contributing and working with long-term and short-term [issues]. It’s also about judgment.

Last year, you warned that Rhode Island is “at risk” of not having the workforce it will need in a decade if the state does not address several societal issues. Have you seen the state respond to this in any way?

I think it’s gotten a lot of attention. But honestly, have we made a big dent? No. There’s a long way to go. Me saying things like that is [intended] to focus attention to maybe get some political and thought leaders to discuss it. It will take leadership.

We’re not experts on all the root causes and all the solutions. What we do is work with people on the ground who know more than we do [to find solutions].

Back in 2020, the foundation committed $8.5 million over three years to address racial disparities and inequities in the state.

Offering the community more ways to go

We’re always looking for ways to support people’s choices in the communities we serve. That’s why Bank of America is adding charging stations for electric vehicles (EVs) to over 90 financial centers nationwide. We’re also supporting the choices our teammates make with employee rebates on EVs.

I am proud of the steps we’re taking in the Rhode Island community to help people pursue what matters to them. The same goes for my teammates, as many have chosen to participate in My Environment,® one of our employee engagement initiatives.

Kevin Tracy President, Bank of America Rhode Island

CONTINUED FROM PAGE 12

What progress has been made through that initiative?

The signature program implemented is the Equity Leadership Initiative. This was to recruit and invest in future leaders for the state in communities of color. We had two groups of 30 people across sectors – nonprofit, for-profit, government – and [all diverse backgrounds].

These are experienced people who want to become more invested in leadership in the state, and we’re investing with them with different programs. We’ve also increased grantmaking in certain areas [to help the minority community].

What more needs to be done to address racial inequity?

It needs to be consistent and steady. Looking at diversity and being equitable is not a one-shot thing. Thirty years ago, I got diversity training when I was a banker. Here we are again.

A lot of this needs to be staying the course. They’re not fast. They’re real commitments. They’re addressing the change in the demographics in the state and country.

What do you feel is the greatest challenge still plaguing the state and how do you hope the foundation moves to help address it?

We’ve identified K-12 education. We have significant education gaps. We need to close those gaps. We need to collectively look at education and what needs to change. Do we need to recruit more teachers? Do we need to provide training? We need to look at the funding formula to make sure it’s equitable throughout the state.

We talked about what you are proudest of. What was most disappointing, not in terms of the intent or the foundation’s efforts, but the lack of tangible results?

We did have one program – it was a favorite of mine – called “All In Your Backyard.” It was designed several years ago to highlight Rhode Island achievements. Someone was the best in this or that. We did a lot of publicity on it. It was well received, but we couldn’t continue it. It was a big advertising campaign that we weren’t prepared to do.

The other is how difficult it is to be patient with long-term change. I’m disappointed we’re not further along in education. I’m disappointed that we’re not further along in health care. The inertia ... resources and leadership need to be committed long term. We need to take all this rhetoric to action. My favorite phrase is the Nike phrase: Just Do It.

The foundation has agreed to provide High Rock Development LLC a $15 million bridge loan for the redevelopment of the Industrial Trust Co. Building, the “Superman” building, in Providence. How important is it for the project to become a reality for both the city of Providence and the state?

[The bridge loan is] still subject to financial and legal due diligence as the project progresses. The opportunity to anchor a revitalized Kennedy Plaza and downtown Providence has only grown, as has the need to jump-start this area given the COVID-19 impact. Additionally, the need for housing downtown has grown and this building can be part of the solution. The statistics showing a very low vacancy rate for downtown housing, the building’s central location, and the truly unique and impressive stature of the building further support that this is the time to leverage the redevelopment of an iconic building for housing downtown. Rhode Island has an unprecedented housing shortage at almost every income level. There is more public awareness of the need for more housing right now

than at any other time I remember. Are you optimistic that the state will wisely spend the $1.1 billion in American Rescue Plan Act funds in the coming years to address many areas of need, including housing, workforce development and small-business support?

I’m hopeful that the state, as well as the cities and towns, is being diligent in using that money. The biggest issue is implementation and accountability. Some areas of the state have done better than others in getting the money out the door. Having the money allocated doesn’t do any good if it’s not out the door. [State officials] need to watch that.

They also need to hold people accountable on what the money is for. A lot of money went out to cities and towns, but I don’t know who is watching that. The accountability is key. Worst thing we can do in five years is say, “Hey, whatever happened to all that money?”

Why was David Cicilline a good choice to succeed you and what should the foundation’s first priority be once he becomes CEO and president in June?

He has been committed to Rhode Island his entire career. He has been involved in a deep way of being out in the community. I think doing this [new role] will draw on more of his experience as a mayor than as a congressman because it’s hyperlocal. He brings a passion, commitment and intelligence. He will bring a wide network. He’s probably one of five people in the state that has a better Rolodex than me.

I don’t see immediate changes [with the foundation]. I think continuity is important for our staff, donors and grantees. I think he will come in, listen and learn. Making adjustments and doing some new things I think will be his prerogative. Is there room for the foundation to become even more involved in statewide planning, with a kind of permanent seat at the table with an ex-mayor and former congressman leading it?

It will depend on what it takes. We already have a seat at the table now, and we get to sit at the head of the table half the time. The reason is that we have funding. When you show up with funding, you get to pay the lunch bill sometimes. We’re not partisan here, and he will be nonpartisan. Do you plan to stay involved in public life and if so, how? Or are you looking forward to riding off into the sunset, so to speak?

I’ll stay active where it makes sense where there is somebody who wants my assistance. I’m not moving; I’m staying here. I’m not running for office – have no desire for that. I want to enjoy the summer. But a lot of it is controlling the time. Right now, I don’t have it – and I’m fine with that. I like the action and fast pace. I will be here as an elder statesman. If someone wants me to help in certain key areas, such as housing and education, I will. Some state leaders asked me to stay involved. I’ll go on some boards, but I’m keeping it open on purpose. n

We always tell people, ‘We can do anything, but not everything.’

AN ACHIEVEMENT: Dozens of community leaders gather to discuss the state’s education system at a forum organized by the Rhode Island Foundation in 2019. The event was part of the “Make It Happen” initiative that the Rhode Island Foundation started in 2012.

PBN FILE PHOTO/MIKE SKORSKI

Neil D. Steinberg

PBN PHOTO/TRACY JENKINS

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A change of country and career

BY SAM WOOD | Wood@PBN.com

(Editor’s note: This is the 33rd installment in a monthly series speaking with minority business owners and leaders. Each will be asked their views on minoritybusiness conditions in the state and for ways to improve those businesses’ chances for success.)

FRANCHESCA M. FERNANDEZ is a trained civil engineer and an elite project manager, but her heart was always in graphic design and advertising.

Fernandez is the proprietor of MakServi Craft & Print LLC in Cranston. Though her business is officially only 2 years old, she wants to grow MakServi into the leading advertising company in all of New England.

Fernandez was born and raised in the Dominican Republic where her father, Francisco, ran a printing shop in El Cibao. As a child, she was immersed in the trade. For 15 years, she gained extensive experience in graphic design, screen printing, textile ink transfer and industrial-scale embroidery.

Fernandez later became enchanted with building things as a teenager. She majored in civil engineering at Universidad Catolica Nordestana in her home country, worked for a general contractor, then earned a master’s degree in project management at International Iberoamerican University in Puerto Rico.

“That’s how I grew up in business,” she said. “I started making small projects step by step, then focused on bigger things.”

In 2015, she moved to Providence with her Rhode Island-born husband. They met when he visited his mother and father on the island nation.

Though licensed as a civil engineer in the Dominican Republic, her license was not recognized in the United States. She needed to find another line of work.

Trained to solve problems, Fernandez did small jobs creating customized coffee cups for church groups out of her home, using a method called sublimation printing.

She discovered she still loved creating advertising products, loved the interaction with customers, loved collaborating with clients on their designs and loved producing tangible goods.

“It’s in my blood,” she said. “I always enjoyed it. So, I decided to take it full time and build my own business.”

HER IMPRINT: Franchesca M. Fernandez was a civil engineer in the Dominican Republic, but when she moved to Rhode Island she decided to start a business that had little to do with engineering.

Customers – mostly Latinos hailing from Central and South America – wanted more services. In October 2022, she moved her operation to a one-story building with a red awning at 1102 Pontiac Ave. in Cranston.

The relocation did wonders.

“A lot of our work comes through word-of-mouth,” she said. “The embroidery is a big part of the business. We create custom uniforms at a reasonable and very competitive price. People heard about us, could see us and started coming to us.”

As a minority business owner, Fernandez says she has had few problems with racism.

“The hardest part is trying to get the trust of every customer,” she said. “But that’s a problem every business owner faces. Sometimes people say they don’t understand my accent, but most people are fine with it. Sometimes people can be unintentionally offensive.

“There are always going to be certain cultural differences that you have to overcome.”

1

Do you believe racism is keeping minorities from starting businesses in the Ocean State or succeeding when they do?

No, I don’t believe racism is keeping minorities from starting their own business or succeeding. However, I do think that the fear of being judged and discriminated against does keep minorities from offering their services and offerings to people who they don’t commonly associate with.

My major customer is currently Hispanics because I know where they are and how they like to be treated. It’s easy to serve them. Recently, I decided to move to a location that exposes me to people outside of my normal. Per my experience, it is challenging even to answer the phone now as I need to carefully pronounce every English word to ensure the person on the other end is able to understand me and choose me for their embroidery and/or printing needs. 2

How dependent is your business on the support of other minority groups? Is that a sustainable business model? Minority groups account for 95% of the sales generated in 2021-2022. I’m grateful for the support they have given me. As the name itself says, minority groups are the minority. If I want to grow my business and generate more sales, I need to break the barrier to serve more than the minority.

and successful businesses to share knowledge in different languages by organizing panels, discussions and conversations.

Lastly, the state could invest in educating minority groups on important topics such as state tax deductions, sales and use tax, legal information, and so on. This will allow minority groups to take the right steps to build and implement good business practices.

4Have you had to turn somewhere other than a bank for a loan? Do you believe the state’s lending institutions generally treat minorities fairly?

Yes, I have had to turn somewhere other than a bank. After understanding how credit cards work and their promotional offers, I chose credit cards as my lender of choice. At the time when I was starting my business, I remember looking at the interest rates; the personal loan rate was 6.9% and the company I used had a promotional offer of zero interest plus a 3% transfer fee. To me, this meant that using credit card offers and their flexibility was the way to go to make the necessary investments in my business. I wasn’t able to obtain a business loan because I didn’t have the business record requirements such as documents, years in business and collateral.

In my perspective, lending institutions generally treat everyone fairly. The requirements they have in place were created with the lending institutions’ interest in mind. Now, we minorities may not fit into their checklist, as we may not have the knowledge and the necessary support to meet those requirements in due time.

What one thing could Rhode Island do to boost the odds for minority-owned business success?

My dream would be to be able to hire employees in production and sales, buy a commercial space and purchase more equipment to generate more revenue and bring it back to the community by supporting other small businesses and sharing my knowledge with others to help them start their own business. 3

Provide more information and reasonable requirements for minority startup businesses to apply for microloans. As a startup, the process to obtain funding is difficult because of the requirements of years in business, proper documentation and collateral. The state could encourage the connection of entrepreneurs, small businesses

5If another minority entrepreneur asked you where they could turn for support for their business, where would you direct them?

I would direct them to the Center for Women & Enterprise. This nonprofit provided me with the help I needed for my business through courses, workshops and boot camps. Help is available in English and Spanish.

I’m so grateful for the help they have provided me with that I have offered myself to volunteer at the center as a QuickBooks facilitator and as part of the Strategic Planning Committee 2023. n

There are always going to be certain cultural differences that you have to overcome.

PBN PHOTO/RUPERT WHITELEY

MAY

25, 2023 12

celebrate THE 2023 WINNERS networking AT AQUA FOLLOWED BY

INDUSTRY LEADERS

Creative

JUDITH LYNN STILLMAN

Rhode Island College artist in-residence and professor of music

Financial

YAHAIRA “JAY” PLACENCIA Bank of America Corp. senior vice president and private client advisor

Legal Services

KAREN GRANDE

Locke Lorde LLP partner

Health Care

DEBRA REAKES

Coastal Medical Physicians director of quality

Professional JUDITH CHACE

Mott & Chace Sotheby’s International Realty owner and broker

Social Services/

Nonprofit

NINA PANDE

Skills for Rhode Island’s Future executive director

Technical

KELLY MENDELL MIKEL Inc. president

AWARDS

Career Achiever

PAULA IACONO

CharterCare Foundation executive director

Outstanding Mentor

MARIANNE MONTE

Shawmut Design & Construction chief people & administration officer

LISTED ALPHABETICALLY

TRACEY BECK,

The Beck Cos. co-owner and chief operating officer

MARY BLUE, Farmacy Herbs LLC founder and owner

AUDREY FINOCCHIARO, Nitro Bar co-founder

MEGHAN GAMBOA, Ageless Innovation LLC co-founder and senior vice president

KRISTEN GOSSLER, American Trophy and Supply Inc. president

MARISA HEAD, Marisa’s Skin Care LLC owner

HAVERHILL LEACH, Haverhill Leach Inc. founder, owner and designer

JO LEE, PopUp Rhody, founder

SHIRLEY MOORE, Be Moore Interpreting LLC owner

ENITH MORILLO, Cadoret Global Inc. principal consultant

MILENA PAGAN, Rebelle Artisan Bagels LLC and Little Sister LLC owner

Creative

ALLY MALONEY WINZER

Maloney Interiors principal

Financial

ELIZABETH DESAUTEL

JPMorgan Chase Co. vice president

Legal Services

ELIZABETH MANCHESTER

Partridge Snow & Hahn LLP partner

Health Care

RACHEL BEST

Small Steps Therapy LLC clinical director and speech language pathologist

Professional

AMANDA LANGLAIS

Falvey Insurance Group marketing manager

Social Services/

Nonprofit

ANGELYNE COOPER-BAILEY

Cranston Municipal Court associate judge R.I. Department of Labor and Training legal counsel

Technical ALISON WICKS

1. Honoree, Meghan Grady (middle) with her Meals On Wheels Of RI team.

2. Honoree Jon Giampietro and John Hazen White, Taco Comfort Solutions with Roger Bergenheim, PBN

3. Rising star honoree Geralyn Hashway, McGuinness Media accepts her award from Don Zambarano, KPMG.

4. 2023 C-Suite Honorees

5. Honoree Michael Friedman, Paolino Properties with Don Zambarano, KPMG

6. C-Suite attendees enjoying the celebration.

7. Honoree Anika Kimble-Huntley, Rhode Island Commerce Corporation

5.

4.

7.

THANK YOU for CELEBRATING with us

8. Honoree Deb Thomas, with her Hasbro team, friends and family.

9. Aaron Lavoie, Paul Lozeau and Julian Emerich, Stanley Tree Service

10. Honoree Paul Larrat, URI with wife Amy.

11. Honoree Dr. Jason Gomez, NUWUC with his wife.

12. Career Achievement honoree Ann Kashmanian, Brown Medicine accepts her award.

13. Presenting sponsor KPMG attendees.

14. The team of Falvey insurance Group with their honoree Roxanne Nelson (center).

15. Honoree from ResusciTech, Brian Morley (center)

8.

9.

10.

11.

12.

13.

14.

15.

thank you to our presenting sponsor

FOCUS | SMALL BUSINESS

LENDERS

CONTINUED FROM PAGE 1

minority-owned businesses, and businesses in rural areas. SBA’s loan programs serve creditworthy small-business entrepreneurs who otherwise are unable to obtain conventional sources of capital.

No one is arguing the merits of expanding opportunities for small-business growth and development, but lenders in the Ocean State and key members of the U.S. Senate’s Small Business Committee are taking issue with how the rules will change the way the SBA distributes those loans.

“The changes seem heavily focused to giving lenders greater autonomy and less guidance, enabling them to rely on automation,” U.S. Sen. Ben Cardin, D-Md., chairman of the Small Business and Entrepreneurship Committee, said during an April 26 hearing on Capitol Hill. “Absent proper oversight, it’s easy to imagine a scenario in which these changes enable predatory lending practices to creep into the program.”

Cardin warned of “unforeseen and regrettable consequences down the road” if the rules are enacted without significant revisions and increased oversight.

One of the key sticking points: the new rules allow financial technology – or fintech – companies and other nondepository lenders to apply for small-business lending company licenses.

The SBA is lifting a four-decade moratorium that prevented it from adding new lenders to its flagship 7(a) and 504 loan programs. The revision also provides permanence for more than 100 nonprofit, mission-oriented lenders in the Community Advantage Pilot Program. Another change loosens affiliation standards, streamlines lending requirements, and reduces paperwork for SBA lending programs.

Opening the programs to fintech companies, which are largely unregulated, could put the entire SBA lending program at risk, says Frederick Reinhardt, CEO and president of Greenwood Cr edit Union in Warwick.

More lenders will require more oversight, and the regulators already don’t have enough resources to monitor for criminality. Cardin said the SBA’s Office of Credit Risk Management is so short-staffed that it cannot keep up with oversight of the 7(a) loan program.

“There’s too much potential for fraud and abuse,” said Reinhardt, pointing to a December 2022 congressional report that accused several fintech companies of raking in billions in fees from the SBA-administered Paycheck Protection Program.

Even the best of the fintech companies don’t have knowledge of the local economy, Reinhardt says.

“The process of getting an SBA loan is about more than filling in the blanks,” Reinhardt said. “A faraway lender is not in the best interest of the small business. A fintech can’t provide personal assistance.”

Of course, expanding the universe of SBA lenders also

risks cutting into the business of credit unions, which traditionally have facilitated a significant proportion of SBA loans. The loans present little risk to lenders because anywhere from 75% to 90% is guaranteed by the federal government.

“Borrowers aren’t necessarily sophisticated,” Reinhardt said. “Though we don’t provide legal help, as bankers we provide experience with insights, thoughts and recommendations to guide the business owners to success. A fintech won’t do that.”

Jeffrey Cascione, senior vice president in charge of commercial lending at Smithfield-based Navigant Credit Union, says he is waiting for the SBA to finalize the instructions and guidelines that will spell out the particulars of how the new rules will impact lending.

“It’s just knowing what the landscape is going to be,” Cascione said. “We don’t want it to turn into the Wild West. We want everyone to serve as advisers, more than just giving money. There are some goodsized fintechs that offer rapid access to capital, but they lack the advisory side of it, the financial wellness guidance, that we can offer to small-business startups.”

U.S. Sen. Jodi Ernst, RIowa, ranking member of the

Small Business Committee, lambasted Guzman during the April 26 hearing for ignoring revisions to the SBA rules suggested by the committee before they were finalized.

Ernst said the SBA is not prepared to evaluate the use of artificial intelligence or machine learning algorithms for underwriting and loan processing. Neither does it have the capacity to enforce federal anti-money-laundering laws and knowyour-customer compliance, both vital controls in the U.S. financial system that keeps money from flowing to and from bad actors.

“I want to be very clear: We need to come to a bipartisan agreement on a legislative response to these rules before we begin negotiations on other aspects of modernizing the SBA,” Ernst said.

SBA Rhode Island District Director Mark S. Hayward says the SBA issued about $151.6 million in small-business loans in Rhode Island in 2022. Through the end of March 2023, the agency had issued loans totaling nearly $70 million.

“Through all the PPP, disaster loans, grants, and restaurant revitalization during the pandemic, we did about $4.1 billion in the state,” he said. “That’s a lot of money on the street in a short time.”

Hayward says it was too early to comment on the impact the changes in the rules would have on lending locally.

“We’ve been told to wait for the [new guidelines] to drop,” Hayward said. “We’ll have a better explanation then.” n

WAITING GAME: Jeffrey Cascione, senior vice president in charge of commercial lending at Navigant Credit Union, is eagerly awaiting the details of the U.S. Small Business Administration opening its flagship loan programs to financial technology companies.

PBN PHOTO/MICHAEL SALERNO

‘There’s too much potential for fraud and abuse.’

FREDERICK REINHARDT, Greenwood Credit Union CEO and president

Retirement benefits with help of state-run fund?

BY CHRISTOPHER ALLEN | Allen@PBN.com

MICHELLE RIVERA, policy director with Progreso Latino Inc., a nonprofit that does not offer retirement benefits to its employees, struggled with the process of setting up a private account on her own.

“It’s been really confusing,” she said.

Rivera is not alone. As companies work to sweeten the pot with added perks to compete for talent in a shrinking labor pool, there remains a large swath of smaller businesses that lack the resources or wherewithal to offer workers retirement savings accounts.

According to the Wharton Pension Research Council, more than 170,000 Rhode Island workers, representing 40% of the workforce, are not offered any retirement plans such as the individual retirement accounts or pensions that are now commonplace in the corporate and public-sector world.

Sen. Meghan E. Kallman, D-Pawtucket, and Rep. Evan P. Shanley, D-Warwick, have introduced legislation to reverse this trend by creating a state-controlled fund available to small businesses – defined as those with five or more employees – whereby employees can contribute up to 8% of their salaries to individual savings accounts through payroll deductions, at no cost to their employers. Workers would be able to take

their savings with them when they change jobs. Twelve states have similar programs in place.

The fund would be administered by a newly created public corporation with a board appointed by the governor and approved by the Senate. Board members would guide investment policy and select one or more third-party financial firms to provide “appropriate long-term retirementoriented investments” determined by the State Investment Commission. The agency would be overseen by an executive director.

The legislation has the backing of R.I. General Treasurer James Diossa, who has been barnstorming the state with a series of visits to small businesses to drum up support.

“While some financial institutions offer similar retirement products, few actively market those products to low- and middle-income workers,” said Michelle Moreno-Silva, Diossa’s director of communications. “Individuals in lower income brackets are considerably less likely to save for retirement or know about the retirement savings products offered by private businesses than those with higher income.”

The fund would still be vulnerable to market volatility, but MorenoSilva said the policy “would include a risk management and oversight program, assuring adequate safeguards.”

This is not the first time such legislation has been pushed in the General Assembly. House Speaker K. Joseph Shekarchi was the primary sponsor of a similar bill in 2017.

Banking and investment representatives have criticized the proposal for expending public dollars for what they say is a phantom problem. In testimony to the House Corporations Committee on Feb. 28, William A. Farrell, a lobbyist and head legal counsel for the Rhode Island Bankers Association, told lawmakers they need only to open the state’s history books.

“Rhode Island has less than a stellar history over supervision of the state’s consumer financial protection

‘Any impact is well outweighed by the long-term financial benefits.’

MICHELLE MORENOSILVA, R.I. Office of General Treasurer spokesperson

FOCUS | RHODE ISLAND’S LARGEST SBA LOANS (ranked by size of loan as of March 31, 2023)

FOCUS | RHODE ISLAND'S LARGEST SBA LOANS (ranked by size of loan as of March 31, 2023)

CONTINUED FROM PAGE 21 responsibilities,” he said, citing as one example the collapse of the Rhode Island Share and Deposit Indemnity Corp. that resulted in consumers losing close to $1 billion in savings “due to negligent oversight by the Rhode Island regulators.”

“There is no shortage of competitive retirement programs available offering our citizens ample opportunity at very competitive costs,” Farrell said. “It [seems] difficult to imagine how a state-sponsored program could provide any greater benefit to the employees of Rhode Island than what is presently available from the private sector.”

The Rhode Island Business Coalition voiced similar concerns in written testimony, citing what it called “a tremendous burden on small-business owners,” particularly those without human resources departments to manage compliance.

But supporters insist the time is ripe for change. They argue the proposed system will not only achieve the primary aim of providing a semblance of financial security to Rhode Island’s working class but would also give business owners a new recruitment tool.

The costs to the state remain an open question. The American Council on Life Insurers says Oregon has already paid more than $5 million setting up its program, with total costs estimated at $23 million.

Morena-Silva says the R.I. Office of Management and Budget has not assessed the bill’s financial im-

pact, but she argues the costs would be worth it.

“While there will be a negative cost impact on the state, any impact is well outweighed by the long-term financial benefits,” she said.

Forgoing a financial nest egg is not only costly to individuals but to the state as well, says Desiree Hung of the Pew Charitable Trust, which supports the legislation. She said the lack of retirement savings is projected to cost the state $456 million in social safety net assistance over the next 20 years.

According to smartasset.com, the average return on a Roth IRA over the last two decades has run between 7% and 10%. An account opened in 2013 with annual maximum contributions would be worth $83,000 today and $500,000 in 2043. Such a sum would make a retiree ineligible for public assistance programs.

Rivera, at Progreso Latino, says financial literacy and language barriers have historically played a role in Rhode Island minority communities failing to invest in their own retirements.

Neither one of her parents ever had a retirement account, which she said contributed to her family being now left to financially support her mother.

Rivera doesn’t want her descendants to go through the same struggle.

“We want a better life for the generations that are coming after us,” she said. “We really didn’t have that safety net.” n

WELCOMES PARTNER SPONSOR

SPREADING THE WORD: R.I. General Treasurer James Diossa visits Rhode Island Spirits Distillery in Pawtucket to talk with co-owner Kara Larson about legislation that would create a state-run fund that would allow small businesses to offer retirement benefits.

PBN PHOTO/MICHAEL SALERNO

FOCUS | RHODE ISLAND SBA LENDERS (ranked by number of loans as of March 31, 2023)

FOCUS | RHODE ISLAND SBA LENDERS (ranked by number of loans as of March 31, 2023)

CLOSER LOOK Ranked by amount of loans 1

Ocean State Business Development Authority

Amount of loans: $7.7 million

2

HarborOne Bank

Amount of loans: $6.7 million

3

The Washington Trust Co.

Amount of loans: $4.9 million

LIST RESEARCHED BY James Bessette

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UPCOMING LISTS

May 26: Intellectual Property Lawyers, Veteran Employers; June 9: Chief Financial Officers, Regional Banks, Rhode Island Credit Unions.

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NL = Not listed last year.

FOOTNOTE

j Number of loans and amount of loans reported by the U.S. Small Business Administration from Oct. 1, 2022, through March 31, 2023.

BANKING IN RHODE ISLAND: A TRADITION OF TRUST

Meeting the Financial Needs of the Business Community

The rapid collapse of Silicon Valley Bank and recent troubles at other larger financial institutions has left many individuals and businesses throughout Rhode Island questioning the stability of their financial institutions.

Providence Business News, the state’s leading business publication, invites the leaders of RI’s financial institutions to join us in highlighting the safety and security of the state’s banks and credit unions.

This special print and digital issue will be published on May 26 and promoted through our daily newsletters and posted online to over 100,000 visitors per month at PBN.com

Highlight your institution’s financial stability, risk management and commitment to RI’s vibrant business community.

For more information contact:

| 401.680.4816

FINANCIAL ADVISING

StrategicPoint Investment Advisors is pleased to announce that Kristina Mello has been named Director of Financial Planning and Senior Financial Advisor. The promotion of Ms. Mello is another example of StrategicPoint’s continuous investment in talent development and focus on improving client services. In this capacity, Kristina will not only continue to serve as a financial advisor for clients, but she will now lead the Financial Planning team and help oversee the development of clients’ financial plans for StrategicPoint. Kristina holds the FINRA Series 66 license as well as Rhode Island and Massachusetts Life and Health Insurance Producers Licenses. She obtained her Global MBA from Suffolk University.

ARCHITECTURE

RGB Architects is pleased to announce Martin Holland to Associate. Martin has been instrumental in transfer from AutoCAD to full Revit operations within the firm. Martin is a graduate of the University of Carolina-Charlotte with both a Master of Architecture and Urban Design. Martin grew up in North Carolina, worked in Rhode Island for 5 years prior to moving back to run operations in RGB’s North Carolina office, serving retail clients in the southern portion of the East Coast.

BANKING

BankNewport is pleased to announce that Tony Brum has been named vice president, commercial lending officer. He is responsible for deepening existing relationships and generating new business within Rhode Island and Southeastern Massachusetts companies in the commercial real estate and industrial space. Brum brings more than 20 years of banking experience to his new role, most recently with Citizens Bank as a business banking relationship manager. He previously held commercial lending and credit positions with TD Bank, M&T Bank, and Bank of America. A graduate of Providence College, Brum is a member of the Bristol Zoning Board and St. Luke’s School executive board and was previously the competitive director for Bristol Youth Soccer. Brum is a lifelong resident of Bristol, RI.

PEOPLE ON THE MOVE

ARCHITECTURE

BRGB Architects is pleased to announce Matthew Wendrof to Associate. As one of our newest Associates, and Revit training leader, Matt will manage the operational and organizational processes of RGB’s standards. Matts dedication to design and construction documents continue to advance RGB’S goals and growth. Matthew grew up in Connecticut and is a graduate of Boston Architectural College and an active member of Killingly, CT, Planning and Zoning Commission.

BANKING

BankNewport is pleased to announce that Angela Biederman has been named vice president, branch manager of the East Greenwich branch at 1000 Division Road. In her new role, Biederman is responsible for customer service, branch operations and team development. Biederman has been working in retail banking since 2011, and joined BankNewport in 2017 as the assistant branch manager in the East Greenwich branch. A native of Vermont, Biederman is a graduate of Purchase College in New York. She is a member of the East Greenwich Chamber of Commerce and is a resident of North Kingstown, Rhode Island.

CONSTRUCTION

JPS Construction and Design is pleased to announce that Dominic Skrajewski has been named Project Manager at the firm. Dominic received his Master’s degree in Architecture from Roger Williams University and he provides vast expertise from years of working in the architecture and construction industries. Working as a Designer and a Project Manager, Dominic has experience taking projects from schematic design through construction administration. Dominic always strives to provide clients with their dream project and his positive attitude makes him an invaluable asset to the firm.

ARCHITECTURE

RGB Architects is pleased to announce George Oliveira to Associate. George has been a team member at RGB for over 20 years, he brings exceptional leadership to RGB, its clients and co-workers. As a newly appointed Associate, George will play an integral role managing projects with an emphasis on applying RGB’s Revit standards which he has mastered through the effective training with his fellow new associates, Matthew Wendorf and Martin Holland. George is a native Rhode Islander and is eligible to sit for the registration exam.

BANKING

BankNewport is pleased to announce that Karen XavierDaCunha has joined the bank as a residential loan mortgage officer. She will identify and develop residential loan opportunities and consult with current and future homeowners to evaluate and determine programs best suited to their individual needs. Prior to joining BankNewport, XavierDaCunha worked at HarborOne Mortgage (previously Coastway Community Bank) for nearly 20 years, most recently as a senior mortgage loan officer, serving much of the Rhode Island and Southeastern Massachusetts communities from its East Providence location. A graduate of the University of Rhode Island, Xavier-DaCunha resides in Pawtucket, RI.

PEOPLE ON THE MOVE

Announce new hires, promotions and accomplishments to the Rhode Island business community.

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IT’S PERSONAL

Faber to lead Tennis Hall of Fame

DAN FABER was recently appointed the new CEO of the International Tennis Hall of Fame in Newport. Faber was the head of the United States Tennis Association Foundation for a decade, increasing the foundation’s revenues by $14 million. In his new role in leading the Hall of Fame, Faber will partner with the executive board, board of governors and staff to further the nonprofit’s mission to preserve tennis history.

What was the impetus of you becoming interested in wanting to lead the Tennis Hall of Fame?

What energized me to be interested in leading the Hall of Fame is a result of my early career as a public school teacher. The mission of the International Tennis Hall of Fame is to “Preserve, Celebrate, and Inspire.” This can be achieved by teaching the history of the game and engaging the remarkable Hall of Famers to educate fans worldwide. I believe there is unlimited potential to connect with and inspire people of all ages in so many ways, and that excites me.

What early goals do you have for the organization?

My initial goal is to listen and learn from various stakeholders – the staff, board of directors, Hall of Famers, donors and sponsors, community members and tennis industry partners. It will be vital for me to learn about the organization’s history and people’s perspectives to help me better identify and develop new growth opportunities. I also emphasize the importance of increasing our international presence both in person and digitally by developing closer relationships with the ATP [Association of Tennis Professionals], WTA [Women’s Tennis Association], Grand Slams and International Tennis Federation. This grand vision comes with costs, and that is where I intend to focus additional fundraising efforts.

What ways will having former tennis star Patrick McEnroe help bolster the Hall of Fame as president?

First, I am thrilled to have Patrick on my team. Patrick’s relationships at every level of our sport will be invaluable. He knows all the “players” in the game. As an ESPN broadcaster, he will be an important voice for the Hall of Fame to convey our messaging well beyond the traditional tennis audience. I also want to mention the major role that Hall of Famer Kim Clijsters will be playing on our team as honorary president. She represents all the positive attributes that professional tennis brings to society, and her global outreach will be critical to our future success.

Do you plan to expand any of the Hall of Fame’s educational offerings to the community? If so, in what ways?

I am still learning the scope of the Hall of Fame’s reach, but I do know we already offer robust educational opportunities to a wide-ranging audience through our website, our museum and TeamFAME, our National Junior Tennis & Learning chapter. For example, the Hall of Fame provides lesson plans for teachers on tennis history and various digital exhibits for fans to explore wherever they are. I look forward to maximizing how we share content with our local Rhode Island educators and students and innovating our offerings for a global audience. n

to grow on

BUSINESS LESSONS come from many sources. I am particularly fond of stories that feature animals.

Here are a few of my favorite stories, along with the lessons we can learn from them:

No bull. Legend has it that once upon a time, a tiger ate a bull. The tiger was so satisfied with his feast that he growled and growled. A big-game hunter heard the growling, tracked it to the tiger and shot the tiger dead.

Moral: When you are full of bull, keep your mouth shut.

Be dependable. A farmer had been plowing with an ox and a mule teamed together. One day, the ox said to the mule, “Let’s play sick today and take it easy.”

But the mule said, “No, we need to get our work done.”

The ox played sick anyway. The farmer brought it fresh hay and corn and tried to make it comfortable.

When the mule came in from plowing, the ox asked how it went.

“We didn’t get quite as much done,” the mule said, “but we did a fair stretch.”

Then the ox asked, “What did the farmer say about me?”

“Nothing,” the mule replied.

The ox played sick again the next

day. He asked the mule about the day’s progress.

“All right,” the mule said, “but we didn’t get much done.”

“Well,” the ox continued, “what did the farmer say about me?”

“Nothing to me,” the mule answered, “but he did have a long talk with the butcher.”

Moral: If you cut out on your job, expect to be cut from your job.

Practice makes perfect. Bringing a giraffe into the world is a tall order. First the baby falls 6 feet or so and usually lands on its back. Mom then delivers the newborn’s first lesson. She positions herself over her newborn and kicks her baby so that it is sprawling head over heels. This process is repeated until the baby stands for the first time on its wobbly legs.

In the wild, baby giraffes must be able to get up quickly to stay with the herd, where there is safety.

Moral: The future belongs to those who are prepared for it.

Competition makes you better. In Africa, a gazelle gets up every morning and knows that it must outrun the fastest lion, or it will get eaten. And every morning, a lion gets up and knows that it must outrun the slowest gazelle, or it will starve to death. So, whether you are a gazelle or a lion, every morning when you get up, you’d better start running.

Moral: If you can’t win, make the person ahead of you break the record.

Constructive criticism should build people up. Major League Baseball umpire Bill Guthrie was sharing the space behind the plate with a catcher from the visiting team who protested many ball and strike calls.

In the fourth inning, when the heckling started up again, Guthrie stopped him.

“Son,” he said to the catcher, “you’ve been a big help to me calling balls and strikes, and I appreciate it. But I think I’ve got the hang of it now. So, I’m going to ask you to go to the clubhouse and show them how to take

a shower.”

Moral: The goal of criticism is to leave the person better than he or she was before.

Everyone is important. A professor gave a pop quiz. The questions were easy, until the last one: “What is the first name of the person who cleans the school?” The students had seen the cleaning person, but how would they know the janitor’s name?

The students had to leave the last question blank. One student asked if that question counted toward the quiz grade.

“Absolutely,” said the professor. “In your careers, you will meet many people. All are significant. They deserve your attention and care, even if all you do is smile and say ‘Hello.’ ”

Moral: Take the time to meet the people who are taking care of you.

Mackay’s Moral: Business and life lessons aren’t always taught in school. n

Harvey Mackay is the author of the New York Times bestseller “Swim With the Sharks Without Being Eaten Alive.” He can be reached through his website, www.harveymackay.com.

$125

HISTORICALLY, SOUTHERN France has taken center stage as the region for rosé wines, the light red, sometimes pinkish-orange wines that don the shelves of restaurants and retail stores in the spring. However, Italy is now becoming known for its rosé wines. Due to the country’s varied climates, Italy puts forth rosés in different styles and taste profiles, which are making it the go-to country for these wines.

First, let’s dispel some myths about rosé wines. They are not made from pink grapes. Rosé is made mostly from red grapes. The color of the rosé wine is due to the grape’s red skins and its contact with the wine juice. If you squeeze a red grape, the juice that comes out is clear. Red and rosé wines achieve their color not from the juice but from the juice’s contact with the grape’s skins.

For rosés, winemakers allow the grape’s juice to soak with its skins typically just for hours. For red wines, the grape’s skins and juice can remain in contact for days or weeks. Hence the reason red wines are a deep color and rosé wines are a shade of pink. Each winemaker makes her or his own decision on how long the skins and juice remain in contact, based on the resulting color and desired taste. After

TO SAVOR | JESSICA NORRIS GRANATIERO

Warm up to Italian rosés

the winemaker obtains that color and taste, wine fermentation is started.

Most rosé wines also are fermented in stainless steel tanks and aged. Therefore, the resulting wines generally have a fresh vibrant and crisp profile. Still, each one is different, based on the soil in which it is grown, the climate of the region and the winemaker’s methods.

The varied cuisines of spring and summer are great partners for rosé wines. Fresh seafood, lighter salads and even meats on the grill pair nicely with rosés. Here are my top three Italian rosé wine picks for this season.

La Spinetta Il Rosé di Casanova, Tuscany, Italy. The Rivetti family owns La Spinetta in both Piedmont and Tuscany. Its Tuscan property is where its rosé is produced. This wine is made from two red grapes – 50% sangiovese and 50% prugnolo gentile – that are then fermented in stainless steel. Winemaker Giorgio Rivetti brings a fresh, crisp style with notes of freshly picked cherries and soft hints of watermelon. Pair with shrimp, grilled octopus and potato salad or turkey burgers.

Garofoli Montepulciano Rosato, Marche, Italy. The Garofoli property

dates back to the end of the 1800s when Antonio Garofoli made wine for the local townspeople in the Marche, a coastal area in central Italy that borders Umbria, Emilia Romagna, Abruzzo and Tuscany. Today, the Garofoli properties are still familyowned and run by its fourth and fifth generations. Its rosato wine is made from the grape Montepulciano, and the coastal climate influences the

resulting taste profile. With a slight salinity that is reminiscent of the ocean, the wine is refreshing with a bracing, yet balanced, acidity. It’s fruit forward with hints of cherry and watermelon with a hint of spice at the end. Pair with a sunny side up egg with shaved truffle, fruit salads and sea scallops atop asparagus risotto. La Valentina Cerasuolo d’Abruzzo, Italy. The Abruzzo region, historically, has been known for inexpensive bulk wine. That has changed, and La Valentina is right at the front of it. This rosato, known in the region as cerasuolo, is made from the grape Montepulciano d’Abruzzo. Quite different in appearance than many other rosé wines, it has a deep fuchsia pink hue. It’s also richer in body than most other rosés. It displays notes of strawberries and spice on the full-bodied palate that ends with a nice mineral tinge. Pair with blue-cheese burgers, barbecue ribs and grilled chicken atop arugula, feta and strawberries. n

Jessica Norris Granatiero is the founder of The Savory Grape, a wine, beer and spirits shop in East Greenwich. She can be reached through her website, www.jessicagranatiero.com.

A DIFFERENT SHADE: These rosés from Italy will pair with a variety of dishes that are commonly served in the spring and summer.

COURTESY JESSICA NORRIS GRANATIERO

EVERY ORGANIZATION using information technology has some form of support, everything from a managed service provider down to “someone from accounting.” This approach not only keeps things running day to day, it also reasonably assumes that security is managed for the network, the users and the data.

While many tools are available to quickly secure the major entry points into a network, there is a tendency to adopt a simple “set it and forget it” approach. Due to the dynamic nature of modern-day network environments and threats, this approach no longer works.

That’s why regular vulnerability assessments and penetration testing safely check defenses and identify potential entry points into a network and data; basically, it’s like a realworld hacker trying to get deep inside the network, collecting information and reporting the findings back to the staff.

Vulnerability assessments and penetration testing are two separate processes working in tandem to identify and test both known vulnerabilities and safely exploit lesser-known ones. The vulnerability assessment scans the network against a list of publicly

Test your defenses

documented security vulnerabilities and reports findings. Typically, this assessment scan finds the major security gaps.

Next, the penetration test is where the security team actively attempts to exploit all documented and undocumented vulnerabilities from both outside and inside the network.

The scans produce valuable reports for staff or outsourced IT teams with both the documented liabilities and specific remediation recommendations. Running these scans does not make a network safer; it’s closing the security gaps that provides the real value.

Cyber insurance carriers are also interested in the reports because performing regular (at least annually) tests and assessments expose the carriers to less risk. We even speculate that this process helps reduce the cost of coverage. We expect to see cyber

insurance carriers mandating regular testing as a prerequisite for renewing or obtaining a cybersecurity policy.

While these tests have been used by large, enterprise-level organizations for years and deliver a clear return on investment, the price tag has become more affordable for small and midsize organizations. And just in time: as larger firms have tightened up their defenses, attacks on smaller businesses have increased dramatically.

According to a January 2023 report by Fundera, there was a 424% increase in new cyber breaches at small and midsize businesses last year.

What’s more, the costs of a breach, even for a 15-person company, can be fatal to an organization. There’s a disruption in the company’s mission, resulting lost sales and customer confidence, increased IT costs to recover data and prevent future hacks, and potential fines and fees from regula-

tory or state agencies.

For example, a 30-person Rhode Island firm recently suffered a loss after a ransomware attack that included a $35,000 payment to the hackers followed by a $230,000 fine paid to the commonwealth of Massachusetts for divulging personal identifiable information of several Massachusetts residents. Then there’s the reputation hit and the cost associated with being without critical data for several weeks.

If a company is addressing all the best practices – business continuity planning, user training, cybersecurity, vendor management, proactive 24/7 monitoring – with a managed service provider or in-house staff, that business is on the right track. But with the addition of vulnerability assessments and penetration testing, the company has a sophisticated and sound security strategy. It’s likely only a matter of time before insurance carriers or government agencies require such tests be conducted. n

Peter Nelson has been the vice president of engineering for NetCenergy LLC, an outsourced information technology provider based in Cranston, since its founding in 2003.

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We expect to see cyber insurance carriers mandating regular testing.

Public not served by lingering flap between governor, AG SBA changes must include oversight

Gov. Daniel J. McKee and Attorney General Peter F. Neronha are apparently not on speaking terms, most recently due to an ongoing dispute over funding for the latter’s office. While such disputes between public officials, especially over funding, are not uncommon, the public would be best served by both men resolving their differences quickly.

AT ODDS: Gov. Daniel J. McKee, left, and Attorney General Peter F. Neronha haven’t agreed on much lately, including the latter’s budget request for his office. Neronha has turned to social media and news outlets to register his displeasure with the governor’s $13.8 billion spending plan for fiscal 2024.

Some observers see benefits to the dispute because it’s led Mr. Neronha to publicly air his grievances with a fellow Democrat. In so doing, he’s shone a light on part of a behind-the-scenes budget-negotiating process that Democrats have tightly controlled for decades in the General Assembly.

But that benefit, however welcome, is an unintended consequence and likely fleeting.

The bigger question is whether the public’s business is being affected. While the two offices don’t need to be in lockstep, they do need to work together.

The attorney general’s office is often called to represent the administration and state departments in legal disputes. Earlier this year, however, Mr. Neronha declined to represent the McKee administration in a legal dispute over the removal of a homeless encampment on the Statehouse lawn in which the governor eventually prevailed.

The state, at Mr. Neronha’s direction, has also hired an outside attorney in an ongoing dispute with an insurer over recouping $40 million in fraudulent unemployment payouts.

Would a happier, better-funded attorney general’s office have taken on either case? Such speculation, fair or not, will only grow with each new case as long as the two leaders remain publicly at odds. n

POLL CENTRAL

EXECUTIVE POLL

Back to class?

Do you feel Rhode Island’s public education system needs to be overhauled?

Yes: 86%

How should public education be improved? (Select multiple)

Expanded career and technical programs: 86%

Are you concerned the current state of public education could negatively impact the future workforce?

Yes: 100%

No: 0%

Unsure: 0%

29%

Are you confident that public education in Rhode Island can be fixed?

No: 57%

Unsure:

Yes: 14%

Allowing more lenders in the U.S. Small Business Administration’s loan programs should only be a good thing. The more lenders, the better the access to capital for traditionally underserved groups, including minority-owned businesses.

But as we have seen in the wake of the collapse of Silicon Valley, Signature and First Republic banks, limited government oversight of lending activities can have far-reaching economic effects.

Local banks are right to be wary of impending SBA changes that will bring in more lenders, including largely unregulated fintech companies.

The SBA is finalizing changes that include lifting a fourdecade moratorium on adding new lenders to its flagship loan programs. But it is troubling amidst this latest banking crisis that some members of Congress fear the agency isn’t prepared to handle stepped-up oversight and enforcement responsibilities.

The SBA needs to take those concerns more seriously before opening its biggest programs to the bad actors who are sure to come with the deserving groups the agency hopes to reach. n

Is the state doing enough to collect on the $65.2 million it is owed by its biggest tax delinquents?

APRIL 28-MAY 4

Yes, businesses need more time to deal with pandemic fallout 2%

Yes, more fines and penalties won’t get people to pay faster 9%

I’m not sure 10%

THIS WEEK’S POLL: Is Rhode Island making the right move in ending the sale of gas-powered vehicles by 2035?

• Yes, it is needed to effectively fight climate change

• Yes, but it should happen even sooner

• No, emissions-free vehicles are not proven replacements

• No, better to incentivize sales of alternatives

• I’m not sure

To vote, go to PBN.com and follow the link on the home page

Tax code must be changed to spur innovation

JAMES T. BRETT

Here in New England, we are proud of our region’s reputation as a global innovation hub. Our region is home to some of the world’s most innovative companies, in industries ranging from defense to life sciences to clean energy to technology. Each day, these businesses are making investments in ground-breaking research and development aimed at saving lives, combating climate change, safeguarding our national security and more.

For many years, the U.S. tax code has encouraged such investments by allowing businesses to fully deduct qualified research and development expenses each year. However, under a provision of the tax reform that was signed into law by former President Donald Trump in 2017, businesses must amortize or deduct these expenses over a period of five years. This provision went into effect for the 2022 tax year. This will ultimately make R&D more costly to conduct in New England and across the U.S. The New England Council believes firmly that the new R&D amortization requirement will halt and harm our region’s continued growth and leadership on the global stage.

As a result of this change, the U.S. is now only one of two developed countries requiring the amortization of R&D expenses. Comparatively, our nation’s competitors,

such as China, currently provide a “super deduction” for R&D expenses that drastically increases the allowed amount deducted for companies that previously did not qualify. This change could result in companies relocating R&D facilities and funding out of the country because it will be more costly to do research in the U.S. This will not only damage our competitiveness, but it also could have significant national security ramifications, as well as job losses.

In fact, a study conducted by Ernst & Young for the R&D Coalition found:

“[F]ailing to reverse this change will cost well-paying jobs and reduce future innovation-directed R&D. Requiring the amortization of research expenses will reduce R&D spending and lead to a loss of more than 20,000 R&D jobs in the first five years with the number of lost jobs rising to nearly 60,000 over the following five years. Moreover, when accounting for the spillover effect from R&D spending, nearly three times as many jobs will be affected. This same study also found that for every $1 billion in R&D spending, 17,000 jobs are supported in the U.S.”

Fortunately, two members of Congress from the New England region are leading the bipartisan charge to reverse this harmful change in the tax code. U.S. Sen. Maggie Hassan, D-N.H., has partnered with Sen.

Todd Young, R-Ind., to introduce the American Innovation and Jobs Act. In addition to allowing companies to fully deduct R&D expenses each year, Senator Hassan’s bill would also raise the cap over time for the refundable R&D tax credit for small businesses and startups, and expand eligibility for the refundable R&D tax credit so that more startups and new businesses can use it.

U.S. Rep. John Larson, D-Conn., has teamed with Rep. Ron Estes, R-Kan., to introduce similar legislation, known as the American Innovation and R&D Competitiveness Act

Similar to the Senate bill, Representative Larson’s proposal would allow companies to continue to fully deduct R&D expenses each year.

The New England Council is proud to support both of these bills, and we urge others in the business community to also encourage Congress to pass this legislation. We have written to members of the New England congressional delegation, calling on them to support these bills, and we are hopeful that Congress will take action to pass them in the near future. Doing so will help ensure that the U.S. remains globally competitive and will drive continued innovation and job creation right here in New England, ensuring that the region remains a global innovation hub. n

James T. Brett is CEO and president of The New England Council, a regional alliance of businesses, nonprofit organizations, and health and educational institutions supporting economic growth and quality of life in New England.

ESG investing is undergoing big stress test

The Federal Reserve raised interest rates again on May 3, by a quarter point, making it the Fed’s 10th rate hike since March 2022 in an ongoing fight to tame inflation. These rate hikes have been raising prospects of a recession amid heightened concerns about the fragile state of banks

SEHOON KIM GUEST COLUMN

The rate hikes are also rattling sustainability-focused investing, better known as ESG investing.

The trend toward ESG investing, which puts pressure on companies to meet environmental, social and governance benchmarks, has almost redefined asset management over the past decade. ESG funds today are a multitrillion-dollar market

However, the high uncertainty around interest rates, along with the prospects of a looming recession and a political backlash, has put the future of ESG investors at a crossroads.

My recent work has documented the impact that tough economic times can have on ESG investing demand. Investments into U.S. sustainable mutual funds have slowed since 2022, suffering their worst net flows in five years. There are critical factors looming that may affect investors’ zeal for socially conscious investing.

One of the primary arguments that big institutional investors make for ESG investing

is that it creates long-term value for shareholders. Companies that pay careful attention to environmental, social and governance issues are believed to be better prepared for distant future risks.

However, heightened uncertainty about interest rates poses a challenge. That’s because higher rates can disproportionately affect the present value that investors assign to long-term investment outcomes. Let me explain.

Within the past year, the Federal Reserve has raised its benchmark lending rate from almost zero to a target range of 5% to 5.25% to combat inflation. In financial markets, higher interest rates lead to higher discount rates. That means that future cash generated by long-term investments is considered to be worth considerably less at today’s higher interest rates.

The more distant an asset’s value lies in the future, the more heavily it will be discounted in value when rates are high. So, long-duration investments – such as most ESG investments – are especially sensitive to changes in interest rates.

Another factor that could affect ESG investing is the potential for an economic downturn.

As research shows, investors do not necessarily make ESG investments for greater

long-term returns, but often for altruistic reasons or due to personal preferences. For these ESG investors, a looming recession could change their perspective on these “luxuries.”

A recent study I conducted with an economist at the Rotterdam School of Management found that retail investors showed signs of shying away from investing in sustainable mutual funds during the early months of the COVID-19 shock in 2020. This was a period when many households experienced layoffs and furloughs, which likely pushed them to set aside luxuries to prioritize protecting the values of their 401(k) portfolios, IRAs and other investments.

In other words, investors may be all for ESG, except when times are tough

Prominent economists have warned of a likely recession. The International Monetary Fund also lowered its global economic growth outlook from 3.4% in 2022 to 2.8% in 2023.

Due to high interest rate uncertainty, prospects of a recession and political upheaval, ESG is under pressure. The next few years will be its most important stress test yet. n

Sehoon Kim is assistant professor of finance at the University of Florida. Distributed by The Associated Press.

GUEST COLUMN

‘[The code] will ultimately make R&D more costly … in New England and across the U.S.’

Support caregivers

Martha L. Wofford

Blue

Cross & Blue Shield of Rhode Island

CEO and president

MARTHA L. WOFFORD was named CEO and president of Blue Cross & Blue Shield of Rhode Island in March 2021, replacing Kim A.Keck. She previously served as group vice president at DaVita Inc. in Colorado.

ASthe CEO of the state’s largest health insurer, I’m energized every day to work to improve affordability of health care, increase access to primary care, combat soaring drug costs and tackle foundational health issues such as access to healthy food and affordable housing.

But my colleagues and I can only work effectively and contribute to the health of Rhode Islanders if we’re recharging our own batteries – and that’s something many of us rarely do. Why? Because in addition to our “day jobs,” many of us are going home to provide love and care to others. This “unpaid caregiving” is one of the most important things many of us will ever do, and it can also be one of the hardest.

During a recent companywide meeting, we asked everyone who was a caregiver to stand. Nearly everyone did. We thanked them for their work and then shared personal stories of caring for loved ones. We laughed and cried together.

I believe to create a healthy and successful workplace today, employees must have a deep sense of belonging –where they feel seen, heard and valued. I know many business leaders in Rhode Island are working hard at engaging and supporting their employees. Addressing the challenges caregivers face can play an important role in those efforts.

At Blue Cross, we’re taking our first steps, including recognizing the issue of caregiving. We encourage other Rhode Island businesses to join us.

Let’s all send caregivers this important message: We see you, we appreciate you and we want to support you and remind you to take care of yourselves as well. n

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