Region's Business, Philadelphia 13 September 2012

COMMUNITY BANKS VS. DODD-FRANK CENTER CITY JOBS FOCUS OF REPORT

SEPARATE SUITE ADDS PRIVACY TO ESTATE

REGION’S BUSINESS

PHILADELPHIA EDITION

A JOURNAL OF BUSINESS AND POLITICS

TOM CORBETT’S MID-TERM IMAGE BATTLE Sliding poll numbers have some thinking a strong Democratic candidate (Sen. Bob Casey?) can unseat him in 2014, but history paints quite a different picture.

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13 SEPTEMBER 2012

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CONTENTS

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Polls May Not Be on Corbett’s Side, But History Certanly Is While a sinking approval rating has some thinking he’ll be vulnerable when he runs for re-election, the past paints quite a different picture.

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Community Banks Feel Dodd-Frank Pinch Already

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PRESIDENT AND PUBLISHER James D. McDonald EDITORIAL DIRECTOR Karl M. Smith ASSOCIATE EDITOR Terrence Casey CONTENT TEAM Brandon Baker, Emily DiCicco, Victoria

Marchiony CONTRIBUTORS Rebecca Catagnus, Vinny Vella, Don Lee ADVERTISING DIRECTOR Larry Smallacombe ACCOUNT MANAGER Charles Coltan

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13 SEPTEMBER 2012

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EDITOR’S DESK

Welcome to Our Endless Election Cycle

Karl Smith is the editorial director for Region’s Business.

You can contact him at ksmith@regionsbusiness.com

We’re still months away from November’s presidential election, with so much still up in the air. That doesn’t mean, though, that state politics are on cruise control.

Anything but.

Recent polls have not been kind to Governor Tom Corbett as he reaches the middle of his first term. That has some, especially in the state’s Democratic Party, smelling blood in the water.

That’s some sense of smell, since we’re a full two years out from the next gubernatorial election.

Some dismiss this, especially given the history of sitting governor’s running for re-election.

Then there’s the little matter of November’s election, where a win by Republican Mitt Romney would likely shut down Democratic hopes of unseating Gov.

Corbett.

Still, there’s plenty of room for speculation, especially since these things take time to percolate. So Rebecca Catagnus took a deep dive into the subject. Her cover story offers a look at some of the potential challengers, as well as the historical hurdles any challenger would face.

There’s a lot at stake in November for state political junkies, including Philadelphia Mayor Michael A. Nutter.

His high-profile speech at the Democratic National Convention put the cap on a political year that has seen him take a starring role on the national stage.

All of this, of course, gets people to talking, and most of the buzz points to Mr. Nutter eyeing up a move down I-95 to Washington, D.C.

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Emily DiCicco dug into this story and found that a November win by President Barack Obama isn’t exactly an automatic pass to the nation’s capital for Mr. Nutter.

Speaking of Washington, community banks say they are feeling the impact of the Dodd-Frank bill, despite assurances from the Federal Reserve that the most burdensome aspects of the bill will not apply to them.

Vinny Vella talked with local bank executives, who have quite a different perspective and say their businesses are suffering because of the legislation.

We’re excited to have more voices in our conversation this week, with op-ed pieces centered on Gov. Corbett from Eric Boehm, a writer for the Pennsylvania Independent website, and Anastasia Przybylski, the co-chair

of The Kitchen Table Patriots and co-director of PA FreedomWorks.

As you can see, there’s a lot going on in this edition and plenty more in the works for the coming weeks. We have writes digging deep into several key issues.

We also have several intriguing Q&A subjects lined up.

I must confess, the Q&A is one of my favorite features; I love spotlighting interesting people and their projects. There are a lot of people making a lot of things happen across the Delaware Valley, and we strive to keep you up to speed on all of them.

Please keep the emails coming. The feedback has been most helpful, and many of the ideas are on their way to future editions.

Take it from state politicians: You can never plan too far ahead.

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WEEKLY BRIEFING

MEDIA

Journal Register Files For Chapter 11 Again

Journal Register Co., a newspaper publisher operated by Digital First Media and rooted in Yardley, Pa., has filed for bankruptcy for the second time, announcing its intention to sell.

Alden Global Capital LLC affiliate 21st CMH Acquisition Co. made the first bite, offering to buy Journal Register’s assets.

A continuing free-fall of advertising revenue despite an increase in digital growth was cited as the primary reason for the publisher’s second bankruptcy, which follows a 2009 exiting of bankruptcy that still left the publisher encumbered by $225 million of debt — debt that Digital First Media CEO John Paton described in a news release as “unsustainable.”

LOTTERY

First Steps Taken To Privatize NJ Lottery Retaining ownership but pushing forward with efforts to outsource operations, the New Jersey lottery met with four companies in Trenton last week to discuss taking over sales and marketing responsibilities.

The lottery system has evolved in recent years to become the eighth-largest state lottery in the nation, employing 150 people.

In 2011, the lottery brought in $2.8 billion in revenue, a number the state is looking to further allocate to state programs and initiatives like education.

The New Jersey Treasury Department would penalize handlers if revenue sunk below the expectations of the state. Additionally, a vendor would pay an up-front $120 million fee before signing a contract committing itself to the project for 15 years.

Scientific Games, Camelot Group, Intralot and GTECH Corp. are among the those HIGHER EDUCATION

Program Earns Grant The Temple Inside Out Prison Exchange Program, which started in 1997 when a local, life-sentenced prisoner suggested the idea, received a $4,000 grant from Bread and Roses.

Inside Out has professors specially trained to teach inmates in an intimate, roundtable-style environment.

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GAMING ECONOMY

Pennsylvania Slot Revenues Increase With New Casino

( B. KRIST FOR GPTMC)

Center City Report: Inner City Focal Point Maintaining more than just a towering skyline, Center City serves as the breadwinner of Philadelphia’s many neighborhoods, containing 38 percent of private-sector jobs in Philadelphia, according to a recent report by the Center City District.

Further emphasizing the importance of Center City’s presence in the city, its nearest neighbor, University City, hosts another 11 percent of these jobs. Per acre, there are 129 jobs in the proximity of Center City with a startlingly low four jobs per acre in the remaining, nonTemple and non-Navy Yard sections of the city.

And those living in other neighborhoods are likely to commute to Center City for their private-sector job, with 11 percent of those in Northeast Philadelphia trekking it to the sky-scraping depths of Center City and 20 percent of West Philadelphia workers making the central commute. Falling somewhere in the middle, 18 percent of Northwest Philadelphia inhabitants travel to Center City for work.

On the whole, the report represents a continuing decline of jobs in the city, a decline that Center City helps keep mitigated just enough to keep Philadelphia afloat.

To combat this, Executive Director of the Center City District Paul Levy has advised alterations to the tax structure of the city, specifically pointing out that business and wage taxes remain at an unsustainable rate for workers while property taxes are in need of an increase. The argument finds its roots in developing the rest of the city to be as transit-friendly and lively as the Center City many visitors and — as it turns out, employees — perceive to be the heart of the city.

The ongoing problem, based on the report, stems from the 193,000 residents who commute to the suburbs for work on a daily basis, which collectively makes up 42 percent of working Philadelphians.

The number raises fear among those in the Nutter administration and City Council that this chunk of Philadelphian workers will inevitably opt to live in the suburbs, perhaps offsetting any growth seen as urban-loving Millenials move into the city.

Still, as Philadelphia’s school system continues to face increasingly impassable roadblocks, tax reform may be more of a long-term goal than the city’s immediate needs call for.

—Brandon Baker

The state drove $210.6 million last month in revenue from its 11 slot casinos, a year-over-year increase of 5.7 percent most likely witnessed as a result of the spring opening of Valley Forge Casino Resort.

According to the Gaming Control Board, Valley Forge brought in $4 million from its slot machines last month, making up for losses in Western Pennsylvania caused by the opening of two new Ohio casinos opened in Cleveland and Toledo. Taking Valley Forge out of the equation, slot revenues still were up by 3.7 percent.

The region’s casinos — namely Parx, Harrah’s Philadelphia, Sugarhouse and Sands — all led the state with increases this month, with the Bethlehembased Sands reporting a healthy increase of 14.4 percent since August of last year.

( VALLEY FORGE CASINO RESORT)

Atlantic City Casino Takes Table Games Outdoors Atlantic City’s Golden Nugget casino reported a strong reception to its recently approved decision by the New Jersey Division of Gaming Enforcement to relocate three blackjack tables to an outdoor seating area of its resort.

The outdoor games first appeared just before Labor Day in another innovative attempt by area casinos to prevent expected losses in total casino revenue for the year, which currently is on target to fall by 7 percent compared to 2011’s $3.3 billion.

PHARMACEUTICAL

Human Genome Faces Staff Cuts More than 100 workers will be laid off at Human Genome Sciences, Inc. as a result of new executive management from GlaxoSmithKline P.L.C., a British drugmaker that acquired the company for $3.6 billion in July.

Glaxo has yet to comment on the estimated job loss for the Rockville, Md.-based life sciences company that has offices in the Philadelphia area, but it insists that the integration of the businesses is an ongoing process.

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WEEKLY BRIEFING

BARTRAM GARDENS

New Leader Announced Heralder of the Philadelphia Green urbangreening program and Harvard graduate Maitreyi Roy will become Bartram Garden’s executive director after Louise Turan’s retirement.

Ms. Roy enters the new position having also formerly been senior vice president for programs at the Pennsylvania Horticultural Society, with her resume further bolstered by her experience as a landscape architect with the Boston Parks & Recreation Department.

Bartram Garden was founded in the 18th century by John Bartram, leading botanist of his era and largely known as the “father of American botany.”

AMUSEMENT PARK

Six Flags Touts Improvements Six Flags’ Wild Safari attraction will undergo changes that will rid the ride of its grassland-traversing family cars.

Renamed Safari Off Road Adventure, the attraction will feature what has been described as an “open air” vehicle that takes riders on a tour in a fictionalized setting to see 1,200 animals.

The original Wild Safari ride will close this fall and renovations will begin in the winter.

DEVELOPMENT

FILM

University City Unveils New Pedestrian Plaza

Old City Hosts Premiere of Philadelphia-Set Movie

The University City District has finished work on a pedestrian plaza located at 42nd Street and Woodland Avenue next to the University of Sciences, an area district officials hope will enliven what has been described as an otherwise “lifeless” area.

Designed and constructed by Think Green LLC, a landscape architecture and ecological design firm located in Glenside, Pa., the project is the first of many that Philadelphia has planned to rejuvenate gray, desolate areas of the city.

Next on the list: barren spread of asphalt on 48th Street and Baltimore Avenue.

Haverford native Sarah Megan Thomas stands with co-star James Van Der Beek on the set of Backwards.

(PDC) NFL

Philadelphia is primed to add one more Hollywood film to its list: “Backwards,” which is Philadelphia-filmed and stars James Van Der Beek and Haverford native Sarah Megan Thomas.

The movie will have a red carpet premiere at the Ritz East Theatre in Old City on September 21. Moviegoers can pre-order tickets online.

The debut will be preceded by an invite-only event held at the Philadelphia Museum of Art on September 20 in celebration of the museum’s use in two scenes of the movie.

Eagles Energy Efforts Lauded Green is more than just the Philadelphia Eagles’ team color, as it turns out.

The Natural Resources Defense Council and the Green Sports Alliance listed the Eagles as one of 20 green-energy leaders, announced at a time when the Eagles continue working to retrofit Lincoln Financial

MEDICAL TECHNOLOGY

(R. KENNEDY FOR GPTMC)

Field with energy progressive solar panels, a natural gas generator and wind turbines that will be responsible for all of the stadium’s energy functions.

According to the council, the comple-

tion of the NRG Energy, Inc.-managed project will give the team off-field bragging rights for having “the most extensive on-site renewable system of any U.S. sports stadium.”

STOCK MARKET

Pep Boys Revenue Up; Look to Cut Debt Philadelphia-based Pep Boys saw its net income soar to $33 million — 61 cents per share — during the last quarter.

Year-over-year, shares have increased by 26 cents with net income figures previously standing at $13.9 million.

Meanwhile, the company’s revenue rose to $525.7 million.

Hoping to extend its good fortune into the future, Pep Boys has also announced that it will start debt refi-

nancing in the near future, looking to cut debt by $100 million going forward.

Further emphasizing the company’s progress, it has hired David Stern as its new finance chief, replacing recent departee Ray Arthur.

Intact Vascular, Inc. Raises $15.5M for Clinical Study Intact Vascular, Inc. has raised $15.5 million for a clinical study to be conducted in Europe testing a blood flow-improving stapling device intended for leg surgery.

Intact, located in Wayne, Pa., is a start-up dedicated to advancing medical device technology. The new project will be led by former CEO of Lutonix, Inc., and now Intact Chairman of the Board, Dennis Wahr.

“We are thrilled to have the financial backing of blue chip investors such as Quaker Partners and H.I.G. BioVentures,” said CEO Carol Burns in a press statement. “We are also honored that Dr. Dennis Wahr has joined the team. His proven track record with Kathy Crothall’s experience as a successful entrepreneur, highlights a seasoned, experienced team around the table.”

Email Brandon Baker with business news tips at bbaker@regionsbusiness.com

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BUSINESS PROFILE

New Penn Beats Housing Bust With Exponential Growth Having only recently risen from the “small business” label, national mortgage lender New Penn Financial LLC has ascended to the big-league, independent ranks of the Inc. 500 at 310 on the prestigious list.

T he company received recognition for not only surviving through three brutal economic years, but also growing exponentially.

Founded in 2008 during the height of the housing bust, the company still managed to grow to employ upwards of 900 workers — disqualifying it as a small business under the Small Business Administration standards — and producing revenues of $47.6 million in 2011.

WEEKLY BRIEFING The company has been praised for its customer-centric business platform and affordable rates with a plethora of mortgage needs offered with the mindset of consumers always taken into consideration.

“Rather than a one-size-fits-all approach, we’ve focused on putting customers in mortgages that best fit their situation,” said Rob O’Han, senior vice president of sales at New Penn Financial. “Growth is natural when you put customers first.”

New Penn Financial’s CEO, Bob Dubrish, has previously been credited for the success story of mortgage company Option One Mortgage, which is a subsidiary of H&R Block, Inc. As a growing company looking to capitalize on its newfound recognition, the mortgage lender has embarked on a hiring campaign by launching www.newpenncareers.com, a website designed to aid interested job seekers.

TRANSPORTATION

SEPTA’s Silverliner V Car Production Delayed A lack of essential parts has kept SEPTA’s Silverliner V cars from arriving by the end of September, as previously anticipated.

According to a SEPTA spokesperson, 110 of the expected cars have arrived thus far, with the remaining 10 outlying as a result of manufacturing problems, effectively delaying the implementation of all 120 new cars until early October.

The production of the new cars, a South Korean-developed and largely South Philadelphian-built manufacturing effort by Hyundai Rotem Co., is already behind schedule by two years. The company faces a penalty of $200 for each day it is late in delivering the train cars.

(SEPTA)

The new cars were originally decided upon in 2006 following mass complaints of overcrowding in SEPTA’s regional rail cars, particularly in the Silverliner II and III trains that date back to the 1960s.

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WEEKLY BRIEFING

GASOLINE

TRANSPORTATION

ECONOMY

Local LukOil Stations Raise Prices in Protest

Some Passengers Will See Faster Screenings at PHL

Report: Pa. Regains 57 % of Lost Jobs

More than 50 different LukOil franchise owners in Pennsylvania and New Jersey raised the price of gas to more than $8 per gallon Wednesday in protest of the company’s pricing policies, The Star-Ledger of Newark reported.

Dealers of the Russian-based company pay up to 20 cents more than their competitors, Sal Risalvato, executive director of the New Jersey Gasoline ConvenienceAutomotive Association, told The StarLedger. Then, they are forced to raise prices on their customers.

The price hike was expected to last less than 24 hours.

Some frequent fliers on US Airways, Delta, United, American and Alaska airlines are now able to pass through security at the Philadelphia International Airport faster, and they can keep their shoes on their feet.

The Philadelphia Inquirer reports that, effective Wednesday, Terminal C allows some passengers to board more easily.

Members of frequent flier groups for the aforementioned carriers can give their personal information to the airline ahead on the flight. These individuals will then be pre-screened by the Transportation Security Admin-

(PHILADELPHIA INTERNATIONAL AIRPORT)

istration.

This information is then saved on a bar code located on a traveler’s boarding pass, the Inquirer reports.

Passengers can also visit globalentry.gov to apply to become a “trusted traveler.”

The state of the economy is stronger, but not necessarily strong, according to a quarterly report released by the Bureau of Labor Statistics.

The bureau reports that, among the 50 states, Pennsylvania falls somewhere in the middle in terms of states that have economically rebounded, regaining 57 percent of its jobs lost since January 2007 — slightly higher than the number of jobs regained nationally, which stands at 4 million following a total loss of 8.8 million.

Pennsylvania’s steady increase is attributed to a natural gas boom in Pittsburgh, offsetting the crippled budget of Philadelphia which otherwise bogs down the state’s economic prospects.

Pennsylvania joins states like Florida and North Carolina in gaining 1.6 to 1.9 percent in the two-year period between second quarter 2010 and second quarter GAMING

UNIONS MINOR LEAGUE SPORTS

Union Pauses Protests Outside Goldtex Building

Allentown Phantoms Arena Delayed, Bond Rating Lowered

Union leaders and the owners of the Goldtex Building are in discussion about involving the union in development of a new project after U.S. Representative Bob Brady brought the two sides together, The Philadelphia Daily News reported Wednesday.

Construction of a 21-story office building on South Broad Stree t could involved union l a b o r, but there are no agreements yet, according to the report.

Michael and Matthew Pestronk, Brady who have been avoiding using union labor at the Goldtex Building construction site, met with union leaders and Rep. Brady last week for more than two hours at the Metal Workers Union Hall.

The Lehigh Valley-located, 8,500-seated hockey arena for the AHL Phantoms team has reached a hurdle in its road to construction, being delayed from an anticipated fall 2013 release to a fall 2014 release — the earliest estimate for the project’s completion.

The news broke as prospective buyers of arena-funding bonds were presented with the new estimated time of completion of August 1, 2014 while looking into buying bonds that fund a new office building and hotel project at Seventh and Hamilton Streets in addition to the arena itself.

The Allentown arena, devised in

Harrah’s Philadelphia Sues Fattah’s Son Chaka Fattah, Jr., the son of a U.S. representative has been sued by Harrah’s Philadelphia for submitting checks valued at $16,000 that bounced, according to The Philadelphia Inquirer.

The Philadelphia Federal Credit Union has also filed a suit against Mr. Fattah for more than $17,000 he allegedly owes on a loan.

DEVELOPMENT

Toll Brothers Plan: Condos, Townhouse on South Street 2010 following the purchase of the Phantoms by The Brooks Group, is expected to cost the city upwards of $450 million. As of late last year, The Brooks Group has signed a 29-year lease with the city, keeping the team in Pennsylvania for the foreseeable future.

Moody’s Investor Services has given

Toll Brothers plans to build 68 townhouses and 59 condominiums on the 2400-block of South Street, The Philadelphia Inquirer reported Wednesday.

In addition, Toll Bros. will develop 2,400 square feet of retail space close to the homes.

Toll Bros. also plans on building 69 condominiums with a roof deck and a view of the Delaware River above a 110-car parking garage on Front Street, according to the Inquirer report.

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WEEKLY BRIEFING

13

GOTTA HAVE IT GADGET

Sony Tablet P Taking cues from Nintendo’s playbook, Sony has evolved the standard concept of the tablet by introducing a second screen in a fold-down, clamshell design.

Aside from being innovative with two screens able to operate separate functions at once, the Sony Tablet P ($350) proves especially convenient for travel, weighing a surprisingly tiny half-pound and boasting 5.5-inch screens — just small enough to fit in your pocket.

MUST-HAVE APP

SwiftKey 3 SwiftKey 3 ($3.99, Android), a souped-up version of the painfully inaccurate autocorrect feature programmed into most smartphones, is perfect for the fumble-fingers business pro who just can’t seem to take clean notes on a tablet or phone.

SwiftKey is designed to recognize common errors and highlight text with an up-close, cloud-like display of your text.

A true app of the future, SwiftKey 3 is even able to determine your next word before you type it.

EXECUTIVE BOOKSHELF WHO TO FOLLOW

@Bill_Gross

Founder of Technology Incubator Idealab and 100 companies in last 30 years.

Tweeting while on my quest for learning in life and at conferences.

RT @Bill_Gross Now that Labor Day’s nearly over, there’ll be a ton of gr8 Tech announcements in the coming weeks. Don’t know what they are, but can’t wait! — September 3, 2012

Disconnecting Digitally Harvard Business School professor Leslie Perlow analyzes the life of big-business executives who wield their Blackberry like a sword, never turning off their inner worker bee and constantly remaining glued to the keyboard of their phone like teenagers discovering texting for the first time.

Beyond the critical analysis, Ms. Perlow suggests some simple — mostly realistic — tidbits for keeping your cool in an era where 2 a.m. emails are commonplace and watching your child’s baseball game from the car as you take a conference call is the new norm.

Bringing like-minded individuals together for a therapeutic meeting of minds, Ms. Perlow’s own mind concocts a simple plan to balance your work life and, perhaps most importantly, your sanity. “So if you are looking for a way to be more effective as a manager, or team leader, turn off your phone and read ‘Sleeping with Your Smartphone.’� – The Chronicle Herald

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DEALBOOK

DEFENSE

Alloy Surfaces Lays Off 145 After Defense Spending Cuts Chester Township-based Alloy Surfaces, the world’s only manufacturer of special material decoys, announced Sunday that it would lay off 145 employees.

The company is being forced to almost halve their workforce after laying off 120 employees last year, due to a decline in orders from the U.S. Department of Defense, which has projected an estimated $500 billion in spending cuts over the next 10 years.

ARCHDIOCESE OF PHILADELPHIA

St. Joe’s University Purchases Archdiocese’s $10M Mansion

STORAGE

Wayne-Based CubeSmart Buys 22 Additional Storage Facilities In a recent deal with Storage Deluxe, Wayne-based storage company CubeSmart acquired 22 storage facilities for $560 million.

The transaction made CubeSmart the largest owner and operator of storage facilities in New York.

PA. INDUSTRIAL DEVELOPMENT AUTHORITY

PIDA Approves Business Loans To Help Create 124 New Jobs The Pennsylvania Industrial Development Authority approved $4.76 million in low-interest loans to support three manufacturers in Allegheny, Bucks and Philadelphia counties. The companies plan to add at least 124 jobs and retain 433 jobs and have committed to investing an additional $7.87 million.

PIDA said it has signed off on $26.3 million in low-interest loans that have helped support $66.2 million in additional private investment and 2,099 jobs in 2012.

Photo courtesy of St. Joseph’s University St. Joseph’s University announced Friday that it has signed a letter of intent to acquire the 8.9-acre property known as the Cardinal’s Residence from the Archdiocese of Philadelphia for $10 million.

Officials currently have no development plans for the property, which is contiguous to the university’s 48-acre Philadelphia campus.

The purchase will be funding by a combination of donor support and internal resources and is expected to be finalized in the next few weeks.

FOOD SERVICE

Cheesecake Factory Opening Will Create 268 New Jobs Cheesecake Factory will open its eighth New Jersey restaurant September 19 at the Quaker Bridge Mall.

The 8,600-squarefoot restaurant will seat 293 customers and is slated to create 268 jobs.

It will join 173 other restaurants owned by Cheesecake Factory Inc., including locations in King of Prussia, Willow Grove and Cherry Hill.

HOLIDAY GIFTS

CSS Industries Sells Halloween Portion to Gemmy Industries Philadelphia-based maker of gift-and holidayrelated items CSS Industries has sold the Halloween portion of its Paper Magic Group to Gemmy Industries for an undisclosed price in order to focus on more profitable product categories.

CSS expects to incur pre-tax charges, net of proceeds, of between $6 million and $7.6 million.

LAW

Blue Bell Law Firm Expands to NC Blue Bell-based insurance law firm Nelson Levine de Luca & Hamilton will open its first office in the Southeast region in Greensboro, N.C. on November 1 as part of an aggressive expansion plan.

The firm intends to recruit experienced attorneys through 2013.

LAW

Philadelphia-based intellectual property and commercial litigation law firm Fox Rothschild announced it has opened a Denver office with three Bryan Cave partners.

This location is the firm’s first in the Mountain West Region and 17th nationwide.

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13 SEPTEMBER 2012

REGIONSBUSINESS.COM

POLITICS

ELECTION 2012

OFFICE OF THE GOVERNOR

ELECTION 2012

Pennsylvania: Swing State?

Governor Touts Transparency, Opponents Challenge Record

Trenton Mayor Arrested, Faces Corruption Charges

It’s been debated all summer: Will Pennsylvania, carrying 20 electoral votes, be critical to this November’s presidential election? Recent actions from both President Barack Obama and Republican Governor Mitt Romney suggest that it will not be.

Pennsylvania politicos were left out of both the Republican and Democratic Conventions. U.S. Senator Bob Casey Jr. was hardly spotlighted at the DNC. Similarly, former Governor Ed Rendell did not have a prominent role.

At the RNC in Tampa, U.S. Senator Pat Toomey was equally low profile. However, most notable was Pennsylvania Governor Tom Corbett’s absence from the convention stage.

Super PACs are following the trend. Liberal super PAC Priorities USA Action suspended its television and radio ads in Pennsylvania, and pro-Romney super PACs Crossroads and Americans for Prosperity have also pulled out of the state.

If Pennsylvania’s no longer a swing state, that leaves Colorado, Florida, Iowa, Nevada, New Hampshire, North Carolina, Ohio, Virginia, and Wisconsin to decide the election.

7TH DISTRICT

Meehan Earns Support from Construction Union The Philadelphia Council of Building and Construction Trades, which represents 70,000 workers in Southeastern Pennsylvania, has thrown its support behind Republican Representative Pat Meehan, of Pennsylvania’s 7th District.

“Pat has been a leader on numerous issues important to our members, including saving Meehan the refineries and the dredging of the Delaware River,” union President Patrick Gillespie told PoliticsPa.com. “These aren’t partisan or ideological issues — they’re common sense.”

The organization’s endorsement takes part of the labor vote away from Rep. Meehan’s opponent, attorney George Badey.

While the seventh district was a competitive race in 2010, Rep. Meehan has much more of an edge this year because of increased fundraising and redistricting changes.

Rep. Meehan said he is “truly honored to receive their endorsement.”

Pennsylvania Governor Tom Corbett sits with Rear Admiral Janice Hamby during a visit to the state capitol.

(U.S. NAVY PHOTO)

During then-Attorney General Tom Corbett’s bid for governor, he promised “100 percent transparency throughout state government.” One year later, that transparency is being debated.

The governor’s office claims that strides in Pennsylvania, such as the soon-to-launch PennWatch — a website that makes government information more readily available — prove that transparency is increasing.

However, not everyone’s convinced.

Since Gov. Corbett was elected, the Office of Open Records, an independent office that determines which government

records fall under the Right to Know Law, has issued 175 record requests.

(The office has asked for information such as the resumes of the budget and education secretaries and a copy of the state constitution.)

Out of these requests, the Corbett administration provided full information on only 11 and gave partial information for dozens of others.

Currently, the Corbett administration is in Commonwealth Court to appeal cases on a request for government-issued telephone numbers and email addresses of employees in the governor’s office.

ELECTION 2012

Poll: Obama Leads in NJ, Romney Better For Economy The latest Quinnipiac University poll shows President Barack Obama is in the lead over his challenger, Governor Mitt Romney, in New Jersey.

President Obama has a seven-point lead overall.

Also, 52 percent of voters view the incumbent favorably, 43 for Mr. Romney.

Voters felt Obama is the better candidate on Medicare and health care, while Gov. Romney is the better candidate on the economy.

The telephone survey of 1,471 likely voters was conducted from August 27 to September 2. The margin of error is plus or minus 2.6 percentage points.

Trenton Mayor Tony Mack was arrested Monday by federal agents for alleged corruption and bribery.

The FBI had been investigating Mayor Mack and his brother, Ralphael Mack, along with convicted sex offender Joseph Giorgianni since September 2010.

The agents claim that Mayor Mack was involved with bribery involving a fake parking garage created as a trap by the FBI. According to court documents, the trio received around $100,000 from posMack ing developers.

Investigators say that Mr. Giorgianni referred to this money by code to Mayor Mack and the mayor understood the reference when they called the money “Uncle Remus.”

HARRISBURG

Part-Time Schedule Sought for US’s Largest Legislature

The legislative calendar of the Pennsylvania’s General Assembly, the largest full-time legislature in the country, has been debated for decades.

The question remains: Should Pennsylvania switch to a part-time legislature, like that of Maryland or Delaware, where legislators meet in one session of the year and work for the remainder of the year?

Pennsylvania switched to the full-time system after a commission determined that full-time operation would disenfranchise lobbyists and keep the balance of power.

Legislators will return in late September, only to take another break from mid-October until midJanuary.

When out of session, legislative leaders spend their time working on items like bill drafts.

Republican Representative Bryan Cutler, of Lancaster is the lead sponsor of a bill that make the legislature part-time, as it was before 1968, according to The Philadelphia Inquirer.

In totality, the legislature is in session for around 60 days.

13 SEPTEMBER 2012

REGIONSBUSINESS.COM

POLITICS

17

STATE

HARRISBURG

ELECTION 2012

EDUCATION

Orie Appeals Jail Sentence

Democratic Office Burglarized

Casey Ads Turn Negative

Governor: Charter School Funding Plan a State Priority

Jane Orie, the former state senator jailed for theft of services, conspiracy, ethics violations and more, is appealing her 2 1/2-to-10-year jail sentence, the TribuneReview reported.

Orie was sentenced in June after being found guilty of 14 counts, including theft of services, conflict of interest, ethics violations, tampering with evidence, forgery and conspiracy for using her legislative office for political gain, according to the Tribune-Review.

Two laptops and a video camera were stolen from the Pennsylvania Democratic Committee’s Harrisburg office in July, according to The Associated Press.

Police would not say why the incident was unreported for two months.

After running a pair of positive, self-promoting television advertisements, Sen. Bob Casey, Jr. has changed his tone.

His latest ad, “Cup of Tea,” attacks opponent Republican Tom Smith.

“Tom Smith is a Tea Party leader who has pushed a divisive, Tea Party agenda,” Campaign Manager Larry Smar wrote in a statement. “Tom Smith is in lockstep with the Tea Party and out of step with Pennsylvania.”

VOTER REGISTRATION

Welfare Offices Assisting With Election Registration

Of the 27,738 people served by the Department of Health through the WIC nutrition program, 16,406 said they are registered to vote. Of the 729 who took voter registration

applications, 162 turned in completed applications, according to a report filed by the state.

Monthly reports will be filed to track voter registration through WIC.

Governor Tom Corbett hopes that once state legislators are back in Harrisburg, they’ll quickly tackle his proposed charter school reform.

“Certainly, the charter bill we were working on back during the budget, the funding formula that we were working on during the budget, I’d like to see us get that done,” Gov. Corbett said Monday, according to The Morning Call.

“I think the school districts would like to see us get that done because it would help them with their planning for the years ahead.”

Gov. Corbett’s proposed education policies have reduced funding to public schools and opened opportunities for additional charter schools in Pennsylvania, especially in areas of low academic performance, such as Philadelphia.

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13 SEPTEMBER 2012

REGIONSBUSINESS.COM

POLITICS

REDISTRICTING

Opponents Take to Court Over State Redistricting Republican leaders of the latest redistricting of Pennsylvania will defend the constitutionality of the plan against more than a dozen challengers in front of the state Supreme Court this week.

The state’s high court had rejected Republicans’ original plan in January, citing multiple concerns.

The writers of the plan say that the revisions have addressed those concerns.

Opponents claim the redistricting plan calls for twice as many splits among districts as necessary, according to The Associated Press.

Senate Majority Leader Dominic Pileggi, a Republican from the 9th District, said the plan “very clearly, very directly meets the direction and the requirements laid out in the court’s opinion,” according to The Associated Press.

VOTER ID

State Supreme Court To Hear Arguments on Voter ID Ruling I KEEP HEARING ‘SNAFUS.’ LET ME SEE YOUR DRIVER’S LICENSE — THAT’S WHAT IT IS.’ — GOVERNOR TOM CORBETT

The Pennsylvania Supreme Court will hold a hearing Thursday in Philadelphia to begin weighing the decision that upheld the controversial Voter ID bill requiring voters to show ID in order to vote, effective this election.

Commonwealth Court Judge Robert Simpson refused to grant an injunction against the new legislation in mid-August; opponents appealed immediately.

In order to overturn Judge Simpson’s ruling, a majority of justices would need to find the law unconstitutional. A draw would allow the ID requirement.

TORT REFORM

Philadelphia Ranked Low for Litigation Climate A survey of how business view litigation climates in various states ranked Pennsylvania 40th of 50, a record low in the Harris Interactive survey. The courts in Philadelphia are ranked as the fifth-worst in the nation.

“The biggest problems in the Philadelphia court relate to lawsuits brought by out-of-state plaintiffs,” Lisa A. Rickard wrote at www.instituteforlegalreform.com. “It’s a general principle of the civil justice system that cases should be tried...where the injury occurred or where the plaintiff or defendant resides.”

SECURITY

House Guards Lose Guns Uniformed guards in the Pa. House of Representatives have been stripped of guns for the first time in more than six years, according to the Associated Press.

Senate guards are not armed, and the area is within the jurisdiction of the Capitol police force.

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13 SEPTEMBER 2012

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POLITICS

DEMOCRATIC NATIONAL CONVENTION

TO MITT ROMNEY, EDUCATION IS A LUXURY. AS GOVERNOR, HE VETOED UNIVERSAL PRE-K. IN HIS FIRST YEAR, K-12 SCHOOLS SAW DRASTIC CUTS THAT LED TO TEACHER LAYOFFS. HE FAILED HIS STUDENTS.’ — PHILADELPHIA MAYOR MICHAEL A. NUTTER AT THE DNC

Mayor’s North Carolina Trip Partly Funded By City Mayor Michael A. Nutter, who has been supporting President Barack Obama this election, took the stage at the Democratic National Convention last week.

Mayor Nutter used campaign money to pay for his travel, but the city paid for five others to join him in North Carolina. Three police officers and two aides accompanied the mayor at a cost of up to $10,000, according to The Philadelphia Inquirer.

MOSES WALKER SHOOTING

Fallen Officer’s Funeral Costs Covered By Philadelphia

The Nutter administration announced the intention of the city to pay for the funeral of Moses Walker Jr., a police officer killed in a robbery August 18.

Politicians and police officers argued the city waited too long before making its decision.

Protocol allows for up to four weeks before determining a police officer died in the line of duty, determining a $15,000 sum for funeral expenses and an unspecified separate amount awarded to surviving family members for pension benefits.

Walker CITY HALL

Mayor Appointing Staffer To Focus on City’s Homeless A task force reported up to 200 people received meals outdoors daily in Philadelphia. It said Center City has 23 indoor locations serving nearly 1,900 meals a day that could serve 50 percent more with more resources.

The mayor said he plans to appoint a member of his administration to implement these recommendations.

CITY COUNCIL MATTERS

PICA OKs Five-Year Plan, Weighs City’s Fiscal Issues The Pennsylvania Intergovernmental Cooperative Authority (PICA) approved the Five Year Plan proposed by the City of Philadelphia. The approval has been largely an annual formality prior to this year, when the city was forced to revise the plan several times at PICA’s request. A rejection would have resulted in the withholding of millions in state and federal funds.

The plan details the city’s fiscal state and projects its future revenues and expenditures.

Three major issues in Philadelphia were highlighted in the report: outstanding labor contracts, Actual Value Initiative (AVI), and business tax reform.

City Council will have to confront these issues as it reconvenes.

Holwick PICA’s report claims “outstanding labor contracts are the single largest short-term financial risk” since Philadelphia does not include any costs for new contracts with the firefighters (IAFF) and two AFSCME units (DC33 and DC47). The IAFF recently won a well-publicized $200 million award through arbitration from the city, but, as the report critically points out, the city does not list this expense since it is appealing the award. Mayor Michael A. Nutter’s office has been negotiating with some labor groups since 2009, and he has been under very public pressure from the unions appearing in protest at Philadelphia City Hall and other locations.

In the report, the property reassessment plan known as AVI is touted as a positive change from a policy standpoint, bringing fairness and maximizing revenue in the property tax system. However, the same issues debated by City Council all spring, which were mechanisms designed to ease the impact of AVI, threaten the constitutionality of the change. PICA claims there is risk until the city figures out how AVI will be implemented and whether it will be successful.

PICA recognized the mayor’s administration and council for their effort in business tax reform, which lessens tax burdens and hopes to make Philadelphia a more attractive location for businesses. The reforms provide limited exemptions to the oft-criticized gross receipts tax and business privilege tax. PICA comments that these changes are “arguably...the most significant economic development initiatives that the City is planning to implement in the next five years.”

Following that comment, the report criticizes the plan for not discussing these changes in more detail, particularly with regard to projected losses in revenue.

Timothy Holwick is a freelance writer covering Philadelphia government. Find more coverage at citycouncilmatters.com and follow him on Twitter @ CityCouncilBlog.

PHILADELPHIA SCHOOL DISTRICT

Report: District Could Lose Millions to Mismanagement City Controller Alan Butkovitz released the FY2011 School District of Philadelphia Report on Internal Control and Compliance September 6, reporting that schools’ disregard for district procedures may be resulting in the loss of millions of taxpayer dollars annually.

The failure of school personnel to comply with procedures enumerated in the district’s School Fund Manual resulted in a slew of discrepancies, including negative balances for extracurricular activities and the compromising of payroll passwords.

A test of the $33 million weekly TransPass program revealed $9,545 in unaccounted passes in four schools over a one-week period, which could add up to millions if indicative of district-wide losses for the year.

“They have to pay attention to financial management and Butkovitz financial issues and accountability in schools,” Alan Butkovitz, city controller, told the Philadelphia Inquirer. “If they don’t have the money, the wheels don’t go around.”

A signature is to be given by a district official for each pass handed out to students, but the report found that 575 of 4,944 of distributed passes had no signature to verify their existence, putting into question the sustainability of the $33 million program.

A copy of the controller’s audit can be found at www.philadelphiacontroller.org CITY COUNCIL

City Council Employees Fired After Facing DUI Charges Two city council employees were arrested Saturday after allegedly driving under the influence in cityowned vehicles they were not authorized to drive.

Receptionist Robin Jones allegedly drove a 2008 Chevy Cobalt into a Center City building early Saturday morning. She was charged with a DUI on the scene. While Ms. Jones was still with the police, she called sergeant-at-arms Rodney Williams, who was also issued a DUI upon arrival.

Ms. Williams and Mr. Jones were officially notified of their termination Monday.

Email Emily DiCicco with political news tips at edicicco@regionsbusiness.com

13 SEPTEMBER 2012

REGIONSBUSINESS.COM

POLITICS

21

Conventions Lack Flair, Relevance in Modern News Era

T

raditionally Labor Day marked the beginning of the presidential campaign. The two political party conventions were long past, and the ramp up to the fall campaign concluded.

It was “game on.”

No longer.

Today, Labor Day is a marker on the stretch run of a very long race. The party conventions are not over (the Democrats hadn’t even begun theirs this Labor Day) and the race has been at full speed for months.

The conventions no longer have the relevance they did in the era before the 24-hour news cycle.

The days of “gavel-to-gavel” television coverage of the national conventions are a distant memory. In 2012 the major networks set aside just an hour each night for convention coverage, devoting the rest of prime time to reality shows and sitcom reruns.

The void created by the pullback of the legacy networks has quickly been filled by cable news, video streaming online and a host of new media outlets.

But the fact remains that the audience for conventions is declining. Although Barack Obama edged Mitt Romney in Nielsen ratings of their acceptance speeches (35 million to 33 million), neither candidate matched their party’s final night viewership of four years ago.

Additionally the audience is aging. Nearly twothirds of convention viewers are 55 or older. The shrinking and aging of television viewers of the political party conventions has been a trend for three decades.

Conventions are no longer suspense- and intrigue-filled events — it’s been more than 30 years since the last time a convention outcome was not clearly preordained. Yet the conventions still serve as a valuable (and expensive) platform to showcase the nominees and contrasting visions of the two major parties.

The contrast in 2012 could not be more stark.

Both parties and their standard bearers agree that they represent diametrically opposite philosophies about the role and function of government.

With less attention paid to key events like the conventions and a deeply divided electorate, the neck-and-neck race will be decided by a small number of undecided “swing” voters. And those voters will reside in a handful of “swing” states.

It is increasingly evident that many of these undecided voters cast their ballots for Barack Obama four years ago and are disappointed and disillusioned now by the failures of his administration, especially in handling the economy. Mitt Romney, however, has not yet made the sale to these critical voters. His challenge remains to convince them that he has both the leadership qualities and the policy initiatives to get the country back to work and our economy back on track.

With less than eight weeks remaining, the focus on those voters has narrowed to a handful of states.

Republican presidential candidate Mitt Romney addresses the crowd at the 2012 Republican National Convention in Tampa, Fla.

Charlie Gerow is CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm.

In Ohio, Florida, New Hampshire, Virginia, Nevada, North Carolina, Iowa and Colorado, millions of dollars will be poured into television advertising in every media market. Voters there will see the candidates, their families and surrogates on a daily basis.

Sadly, at this point in the race, Pennsylvania is not among those key battleground states. It is the first time in a generation that we have not had that level of attention and spending lavished upon us. It’s bad news not only for television stations staring at unfulfilled revenue projections for the political cycle, but also for the hotels, caterers, rental companies and others who support the road shows as they roll through town.

Hopefully, that will soon change.

Twenty electoral votes is a prize offered by only a few states, most of which (California, New York, Texas, and Illinois) are well cemented in one column or the other. Historically Pennsylvania has been a swing state, and the margins here have often been narrow (closer in 2004, for example, than the much ballyhooed margin in neighboring Ohio).

(JAYEL AHERAM)

It’s distinctly possible that Pennsylvania will move up on the depth chart.

Four years ago the McCain campaign made a relatively late decision to pour massive resources into the commonwealth. And while both the campaigns and most of the major independent expenditure operations have cut or dramatically curtailed their television buys here, that could change very quickly. It is also possible that major independent expenditures could be focused in the Keystone State even if the campaigns themselves stay out.

There are a lot of mile markers remaining on the road ahead. Labor Day may no longer be the unofficial beginning of the campaign here, instead serving as just another day in this era of the 24-hour news cycle — where a day is political eternity. The battle for the narrow column of undecided voters in key states will resemble a ping-pong game, with the back and forth of messages, charges and counter charges. Let’s hope that Pennsylvania again gets to play host to a major part of the match.

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13 SEPTEMBER 2012

REGIONSBUSINESS.COM

IDEAS

From Employee to CEO: What I’ve Learned

Gina F. Rubel, Esq., is the president and CEO of Furia Rubel Communications, Inc., a strategic marketing and public relations agency. For more information go to furiarubel. com.

I have been thinking about the lessons I’ve learned along my career path: lessons I’ve learned on my own and others that I’ve been taught by former colleagues and bosses. Those lessons have been both good and, let’s just say, things I never want to emulate or repeat. So I decided to share a compilation of lessons as they relate to running a successful business (no matter if it’s a law firm, marketing agency, accounting firm, public relations agency, etc.)

Here are just a few things that I’ve learned along the way which have become guidelines that I try to live by.

Set up systems and templates. Systems need to be adopted from the start of a business lifecycle and updated and refined regularly. I have met with firms time and time again which do not use business management software but think they are ready for strategic business development and marketing initiatives. I have been known to tell them to think again about adopting an aggressive and strategic marketing strategy without foundational systems as the company will eventually implode.

It’s not about you. I’ve been heard saying this too. Marketing and public relations is not about stroking the ego of the professional seeking to be the next correspondent on a major news network – it’s about strategically, methodically, systematically and frequently reaching your target audience on their terms, where and when they want to be reached with the messages that they will hear and respond to. So if your target audience isn’t watching that network news program, the time and energy spent landing the spot isn’t going to

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make that big of a difference. And if your target audience could care less about your new product or take offense to the messaging and campaign, you’re dead in the water. Just look at Bic’s most recent product blunder with the “Bic Cristal for Her,” a pastel ballpoint pen that costs 70 percent more than identical regular pens and has been criticized as having “sexist labeling.”

Keep it real. Flattery and overkill may land the client but it certainly won’t create a foundation for a long-term business relationship.

I remember meeting with a prospective client (executive director of a national nonprofit organization) who asked me, “What tickets to which major sporting events are you going to give me if we work with you?” My response: “None.” From that moment on, I wasn’t interested in the business because I knew the executive was always going to believe the grass was greener somewhere else.

It’s okay to say no. Business development is much like dating – you don’t always like or believe the other person you are interacting with and/or you cannot always fulfill their needs. There’s nothing wrong with either.

Keep your relationships real. Don’t try to pretend to be something you’re not and certainly don’t promise to deliver something that you have no clue how to handle. It’s okay to turn down the second date and hand the prospect off to someone who may be a better match.

Lead by example and practice what you preach. It always blows my mind when a person cannot follow his/her own advice. While the statement is certainly cliché – there’s no better way to put it. If you’re going to be an

absentee boss, you can expect to have distracted and absentee staff. If you expect your staff to give 100 percent, then you have to do the same. If you want your employees to be honest and forthright, then you have to be an open book. Your employees and clients, just like your children, will emulate your behavior over time.

Provide sound reasoning and data. When you give someone advise or direct someone to do something, you need to explain why. Teach people your reasoning and back it up with sound data. As a marketing strategist, I give clients advice every day. The advice that is the most readily accepted is the same advice that is backed up with sound reasoning and data.

It’s no different when you’re giving a directive to an employee or client. Teach them what they need to know so they can embrace the counsel rather than have it fall on deaf ears.

And with that said, I will conclude with: Choose your battles wisely. This is a lesson that took me more than 30 years to learn. As a youngster growing up in South Philadelphia, I had a bit of a chip on my shoulder and always thought I was right. I would go to battle over a political topic, a little white lie someone may have told me just to keep the peace, or the passing insult that had no real meaning.

Since then I have learned to choose my battles wisely and if I’m going into combat, I’m going to back it up with sound reasoning and data, practice what I preach, know when to say no, keep it real, remember that it’s not about me, and in the end, walk away unscathed.

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GOVERNOR CORBETT’S MID-TERM IMAGE BATTLE Polls show his approval ratings sliding, which has some thinking he might be vulnerable to a strong Democratic challenger in 2014, but history bodes well for Gov. Corbett, who nonetheless has much at stake in November’s presidential election.

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13 SEPTEMBER 2012

REGIONSBUSINESS.COM

A

BY REBECCA CATAGNUS

n election more than two years down the road may seem a lifetime, especially when it comes to discussing the Pennsylvania governorship in the middle of a heated presidential race.

Yet, Governor Tom Corbett’s approval numbers have been slipping to the point where some believe he may be vulnerable when he runs for re-election in 2014.

But does the outcome of November’s election have an impact in 2014 gubernatorial election?

If there is any correlation at all, it will depend on who wins the presidential election—Barack Obama or Mitt Romney.

States whose gubernatorial elections that run concurrent with the national elections can often times see a candidate swept up in the momentum - the “coattail effect.”

Pennsylvania, on the other hand, chooses governors two years after the fact, and much of the fanfare from the national election has died down.

However, the president still may be influential based on his popularity at the time.

“Certainly presidential policies have had a mild coattail effect in the past,” said Rogers Smith, the Christopher H. Browne distinguished professor of political science at the University of Pennsylvania. “If a president is becoming unpopular, a candidate has to distance themselves or defend policies that are no longer popular with the public. Democrats suffered from that in 2010.”

The president, if popular at the time of the state’s governor’s race, can benefit a candidate, said former state gubernatorial candidate Tom Knox, if he comes and campaigns on his behalf.

Historical voting trends for the state governorship for the past 30 years, however, show very little statistical correlation between the presidential and gubernatorial elections.

In every case in which an incumbent ran, the incumbent was reelected—regardless of party affiliation and party of the president. When the seat has been open, it has gone to the opposite party that held the seat previously.

“Incumbency is a very strong advantage, especially in this state because people don’t pay a lot of attention to the governor’s race,” Carol Jenkins, a political science professor at Temple University, said. “For example, the governor has more responsibility than the president for state economic policies but is held less responsible—

he gets a pass. Most people don’t even know the governor’s race is coming up.”

She added, “The incumbent also has name recognition, which is extremely important because they are running against someone who is not known by half the state.”

Despite history being on Corbett’s side, a few experts and potential candidates think the governorship may still be winnable for Democrats 2014.

“The governor has the lowest approval rating ever because of some of the things he has done,” Jenkins said. “He would be defeated if Democrats could find a strong candidate like Rendell—but Rendells are hard to find and Democrats have a tendency to not put up a strong candidate.”

“The [incumbency] trend does represent a big obstacle but Corbett has also been pushing for broad cuts, especially to education in general. If people believe government services have declined, if the state’s economy is not good, Democrats will have a chance to push against him. If Obama is reelected and economic conditions improve, Democrats will be able to make a strong case but it will be an uphill fight.”

Another challenge facing Corbett is The Penn State fiasco involving Jerry Sandusky.

There is contention about whether or not the issue will have reached its media shelf life in two years—will voters remember and, more importantly, will they care?

“People have long memories on things like this and it doesn’t go away. When the real truth comes out— and it probably won’t come out for another year—and things unfold, it will still be in the news,” said Knox. “The primary is a year and a half and all those ads will start picking it up.”

State Sen. Anthony Williams, D-8th Dist., said he thinks the issue will still be relevant but only if the state auditor general continues to pursue it.

Auditor General Jack Wagner says his office is keeping close tabs on the case and he’s made several recommendations to the governor—including mandating Penn State be subject to open records laws and changes in the governance of the university that include disallowing the president of the school and state governor to be voting

The poll stories On August 27, The Philadelphia Inquirer published an edition of its Pennsylvania Poll, powered by Global Strategy Group and National Research Inc. Here’s what they reported in regard to Gov. Tom Corbett.

43%

responded “somewhat unfavorable” or “strongly unfavorable” when asked of their opinion of Tom Corbett.

52%

responded “somewhat unfavorable” or “strongly unfavorable” when asked of their opinion of how Tom Corbett has handled the job of governor.

61%

responded “somewhat unfavorable” or “strongly unfavorable” when asked of their opinion of how Tom Corbett handled the Penn State scandal while he was attorney general.

11%

Barrack Obama’s lead in Pennsylvania, according to a Quinnipiac University / New York Times / CBS News poll.

9%

Barrack Obama’s lead in Pennsylvania, according to a Morning Call/Muhlenberg College poll.

MITT ROMNEY PHOTO BY TONY ALTER BARRACK OBAMA PHOTO BY ERIN A. KIRK-CUOMO

26 of the school and state governor to be voting members on the board.

The inquisition can, however, benefit Gov. Corbett.

Mr. Smith said, “The issue with Penn State may well have faded by then. There’s a lot of unhappiness in the state when it comes to this issue and Corbett is broadly credited with taking aggressive action to correct it. …It will probably help him if it plays a role at all.”

Even if this issue is awash, there are several other areas Gov. Corbett may be lacking in, and people in Harrisburg are beginning to chatter.

And with a glimmer of opportunity that a Democrat could defeat Gov. Corbett in 2014, speculation has begun about who the possible candidates will be.

“I’m considering it right now,” Mr. Knox said. “I’m the only one who’s announced it.

“I don’t think [Corbett] gets it. Why not tax the [Marcellus] shale gas? Why pull money out of education? Why not pay for health care? Why not make programs available for kids who need money for education?”

He said the governor is not doing enough for women in the state, especially in the Philadelphia area, where he says victims of domestic violence are required to deliver their own protection from abuse orders to the perpetrators who abused them. He also takes issue with women not receiving a prevailing wage in certain occupations.

Ms. Jenkins said she thinks Mr. Knox has a better chance of winning the governorship than he has in past elections, when he ran for mayor of Philadelphia.

“Knox is self-funded but lacks a personality, which hurt him when he ran for mayor. He’s just not good at meeting people face-to-face. He doesn’t have to do that with a gubernatorial race,” she said. “He can run TV ads, which doesn’t necessarily show who the person is.”

Ms. Jenkins added that she believes state treasurer Rob McCord has the best chance of beating Gov. Corbett.

“Rob McCord would be the best candidate but it would be dependent on how low Corbett’s numbers are and he’s pretty low for someone in his tenure,” she said.

Mr. McCord, known as a productive fundraiser, has been asked about tossing his hat in the gubernatorial

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REGIONSBUSINESS.COM

CASEY JR. IS MORE A COMMITTEE PERSON AND COOPERATIVE LEADER. HE IS MORE COMFORTABLE IN THE SENATE THEN HE WOULD BE AS GOVERNOR.’ —CAROL JENKINS, TEMPLE UNIVERSITY

U.S. Senator Bob Casey ran for governor in 2002, but lost in the Democratic primary to Ed Rendell. He said if he wins re-election for another Senate term in November, he would finish out that six-year term.

ring and Mark Nevins, his reelection spokesperson, told PoliticsPA it was not entirely out of the realm of possibilities. Mr. Nevins added, however, that Mr. McCord is more concerned with focusing on his current job.

It’s a popular response, one given by Mr. Wagner as well.

He said, “We are doing a great job managing the state’s finances and will continue to advocate for taxpayers. …I have no intentions of running for governor in two years but am always considering options going forward.”

Although he does have plans for the state if he were to pursue the executive office. He stated one area the state government is deficient on is infrastructure, which would be an issue he would champion.

“Many issues remain outstanding,” he said. “One of which is to invest in

our roads, bridges and mass transit. I was, and am, a safety engineer and we have serious problems in Pennsylvania.”

He said Pennsylvania is ranked the worst in the country for bridge safety with many of the problems being in the southeastern part of the state.

He also feels more needs to done to address unemployment and investing in infrastructure is one way to provide jobs and safety.

Sen. Williams said he would revisit the possibility of making another bid for governor when the time comes but is also considering running for mayor of Philadelphia.

Although he is also known to be a good fundraiser in the state, he has his critics.

“Williams is heavily funded and he’ll run for mayor. If he doesn’t win

then he will run for governor,” said Jenkins. “He’ll never win a governor’s race though because he’s black and Pennsylvania will never elect a black governor.”

She also thinks it’s highly unlikely Mayor Michael Nutter could defeat Gov. Corbett because of his association with Philadelphia, which has historically proven to be the case for most former city mayors due to the demographics of the state.

“A lot of people outside of Philadelphia don’t see Philadelphia leaders as concerned with the whole state as they do their city,” said Mr. Smith. “Those in the rural parts of the state see their interests as different than of the those in the big city.”

If Bob Casey Jr. is successful in his reelection bid for the Senate, then he may very well follow in his father’s footsteps and pursue the governorship.

The Philadelphia Inquirer reported on a July press club luncheon in Harrisburg, during which Sen. Casey wouldn’t rule out running for governor.

The paper reported that Sen. Casey said, if re-elected, he would complete another six-year term.

“One of the reasons I’m running for re-election is to continue my work in this term, and we’ve got plenty to do,” the paper quoted him as saying.

However, the end of the next six-year term would coincide with the end of a second Corbett term.

And Sen. Casey has campaigned for a different job while in office before. In the middle of his second term as the state’s auditor general, he campaigned in the 2002 Democratic primary for governor, losing to Ed Rendell. Mr. Rendell, of course, went on to win the general election.

Then Sen. Casey won his seat in the U.S. Senate halfway through his term as the state’s treasurer, defeating incumbent Rick Santorum in 2006.

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CREDIT: CHESAPEAKE BAY PROGRAM

The Penn State scandal, and Gov. Tom Corbett’s role in it while he was attorney general, may not be a negative, according to Rogers Smith of the University of Pennsylvania. “Corbett is broadly credited with taking aggressive action to correct it. …It will probably help him if it plays a role at all.”

Sen. Casey’s father, of course, served as governor from 1987 to 1995.

“He doesn’t have the same personality his dad does,” said Ms. Jenkins. “He doesn’t have an executive leadershiptype personality. Casey Jr. is more a committee person and cooperative leader. He is more comfortable in the Senate then he would be as governor.”

Even if Democrats pressure Sen. Casey to challenge Gov. Corbett, the decision would be “up to him,” Ms. Jenkins said.

Other wildcard candidates have been mentioned as well.

Rep. Allison Schwartz, D-13th Dist., and Montgomery County Commissioner Josh Shapiro are rumored to be on the long list of potential candidates.

“Allyson Schwartz is an example of a person with a good deal of political visibility but by the same token is someone who would have trouble getting elected,” said Mr. Smith. “Democrats need a candidate that can appeal to all parts of the states the way Ed Rendell could and I don’t think she can.”

Ms. Jenkins concurs.

“I think Allyson has some ambitions for higher office but she’s kind of an

independent entity. She might not have the structure established to run for governor,” she said. “She may make a run for senate though or she might just stay where she is.”

Mr. Shapiro, she said, probably has higher ambitions but is not ready to run for governor yet.

“It’s a little early in Josh’s career but he probably wants to develop Montgomery County,” said Ms. Jenkins. “I don’t think he is going to run this time but he does have a strong support network. He’s very well liked and good at getting out the vote.

“He also has the same resume as Joe [Hoeffel] but he’s a much stronger candidate then Joe. Joe’s not a strong candidate, and I’m not sure why that is. He never took hold in democratic primary.”

Former Montgomery County Commissioner Joe Hoeffel made a bid for the governorship in 2010 and was a representative for Pennsylvania’s 13th district.

Whoever the challenger to Gov. Corbett is, he or she must have a broad appeal across the state to upend the long-running tradition of the incum-

bent winning.

Then there’s the matter of this year’s presidential election.

In the 2008 election, Mr. Obama took the state’s then-21 electorates with more than 620,000 votes. The win here was largely attributed to his popularity in Philadelphia and surrounding swing counties, home to roughly 40 percent of the state’s population.

Pennsylvania is still considered a left-leaning state today and will more than likely go to President Obama again, according to The Washington Post.

In addition, the Commonwealth has gone with every Democratic presidential nominee since 1992. And for that reason, some experts believe Gov. Romney supporters already assumed history will repeat itself and pulled resources out of the state during this campaign season. “[Obama is] very likely to win because polls show him ahead. Romney has not targeted Pennsylvania or treated it as a swing state,” Mr. Smith said. “If the polls should shift, if they think polls will shift, they will return.”

[STATE SEN. ANTHONY WILLIAMS WILL] NEVER WIN A GOVERNOR’S RACE THOUGH BECAUSE HE’S BLACK AND PENNSYLVANIA WILL NEVER ELECT A BLACK GOVERNOR.’ —CAROL JENKINS, TEMPLE UNIVERSITY

DEMOCRATS NEED A CANDIDATE THAT CAN APPEAL TO ALL PARTS OF THE STATES THE WAY ED RENDELL COULD AND I DON’T THINK [ALLYSON SCHWARTZ] CAN.’ —ROGERS SMITH, UNIV. OF PENNSYLVANIA

28

MONDAY APRIL 9, 2012 REGIONSBUSINESS.COM

Nutter’s Path to D.C. Not So Clear

BY EMILY DICICCO From the Democratic National Convention to the U.S. Conference of Mayors, Philadelphia Mayor Michael Nutter has been on the national stage all year, promoting himself, the Democratic party, and above all else, President Barack Obama’s reelection campaign.

But he wasn’t always such an Obama team player.

During the 2008 primary, Mayor Nutter campaigned for Senator Hillary Clinton, due in part to his relationship to Former President Bill Clinton.

Similarly, during Mr. Nutter’s run for mayor in 2007, President Obama endorsed Rep. Chaka Fattah.

Primaries aside, after President Obama’s election, Mr. Nutter has worked extensively for his campaign.

He’s spoken on behalf of both Obama’s during several of their Philadelphia visits.

Giving him an even greater national presence, he was appointed “America’s Mayor” for the year in July. Following the appointment, Former Pennsylvania Governor Ed Rendell speculated what could come next.

“It is a very important position and it will give the mayor leverage with the White House, leverage with the Congress,” Rendell said. “It’s a very positive chip in terms of being able to turn it into some beneficial developments for the city of Philadelphia.”

Did he say leverage? Is Mr. Nutter planning an early exit from Philadelphia, to say Harrisburg, or Washington. D.C? “I think it is pretty clear that Nutter wants a spot on the national stage,” said political science professor at Temple University, Carol Jenkins.

Although there’s speculation that Romney has given up on Pennsylvania, with a whopping 20 electoral votes, Pa. is a must-win for President Obama. If Mr. Nutter assists in that goal, President Obama may owe him a favor.

It’s not as though Mr. Nutter would be the first Philadelphia mayor to make the move. Former Mayor Joseph

Sill Clark, Jr., who served from 1952 to 1956, moved on to the Senate and after Wilson Goode’s term as mayor from 1984 to 1992, he worked in the U.S Department of Education. However, only one Philadelphia mayor in decades has been elected governor - Rendell. Perhaps Mr. Nutter could make a similar move. Perhaps, but it’s unlikely.

“It is very difficult for a Philadelphia mayor to get the support across the state needed to be elected governor.

Ed Rendell is the only modern mayor to do so. He has more appeal to the rural and small-town voters who predominate in the rest of the state than Nutter is likely to have,” said Distinguished Professor of Political Science at UPenn, Rogers Smith.

If not governor, senator?

“There could be opportunities for him in 2016 either in the U.S House or challenging Toomey’s re-election to the U.S Senate. Lots of other things, retirements, etc., would have to happen in the meantime.” said Robin Kolodny, political science professor at Temple University.

If governor’s out and senator’s only a possibility, that leaves one option: a spot in the White House.

“It is also entirely possible that Nutter would be offered a position in the [Obama] administration,” Mr. Smith said.

Pennsylvania win or not, the decision comes down to President Obama, and not everyone agrees he’ll be so generous with positions.

“Time will tell, but personally, I can’t see Nutter being part of an Obama team. I think he is suffering from delusions of grandeur, but I might be wrong,” Mrs. Jenkins noted.

Expectations aside, if Mitt Romney is elected, all of Mr.

Nutter’s aspirations would be shut down. It seems Mr. Nutter has a lot on the line this election season; citizens across the country are sure to hear more from him this election season.

“He [Nutter] can, however use his office to lobby for an executive position in a new Obama administration if Obama is re-elected.

Whether that will happen depends on how long a memory Obama has,” Mrs. Jenkins contended.

I THINK HE IS SUFFERING FROM DELUSIONS OF GRANDEUR, BUT I MIGHT BE WRONG.’ —CAROL JENKINS, TEMPLE UNIVERSITY

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Ms. Jenkins agrees.

“I’m guardedly optimistic that Obama’s chances are very good,” she said. “The Koch brothers took their money out of Pennsylvania and put it elsewhere. That is an indication to me they think it’s not worth spending their money in the state.

That was a good sign that Republican support is conceding.”

The Associated Press reported earlier this month that neither presidential candidate is running any ads in Pennsylvania or Michigan, which calls into question whether using the amount of television advertising is a reliable indicator of who will win the state.

Both parties appear to be focusing more on swing states such as Colorado, Florida, Iowa, North Carolina, New Hampshire, Nevada, Ohio and Virginia.

Despite Obama’s current lead and historical advantage, a statement provided to Region’s Business by the Romney campaign says it believes Gov. Romney will carry Pennsylvania and cites Gov. Corbett’s election as proof the blue climate is turning red.

“Fueled by unparalleled Republican momentum that swept through the Commonwealth in 2010, we continue to see growing excitement for the Romney-Ryan ticket in Pennsylvania.,” wrote Kate Meriwether, Pennsylvania communications director for Romney for President. “Polling has consistently showed apathy among Democrats and disapproval in President Obama and the path our nation is on in a state that President Obama won by double digits in 2008.”

She added that the Romney campaign is placing its efforts into an “unprecedented grassroots campaign,” rather than advertising.

The Romney campaign isn’t the only entity questioning President Obama’s ability to win Pennsylvania either.

It appears there is a split among some Democrats as to the president’s chances to pull off another victory here in 2012.

“I think it is going to be a very close election myself, and I’m not sure he can do it. I know he’s up in Pennsylvania but he’s got a lot of work to do,” said Mr. Knox. “People are mad. They are mad because they don’t have jobs. Their kids don’t have jobs. Their kids are mad because they don’t have jobs and have to live with their parents.”

Rep. Mark Critz, D-12th Dist., who is seeking reelection in a conservative area of the state, shunned the Democratic convention to campaign in his district.

He publicly criticized the president in

June after President Obama’s economic speech saying, “President Obama and others in Washington need to realize that we cannot spend our way to prosperity.”

But Pennsylvania has weathered the economic downturn better then some other states.

“There are certainly some pockets of economic hardship but the state has not undergone dramatic economic fluctuations,” said Mr. Smith.

“Pennsylvania is a state that has had a relative stable economy and population in the modern period.”

He attributed the Marcellus shale, along with other factors, with providing jobs THE CORBETT FILE Nfe k_\ )'(' ^fm\iefiÊj iXZ\ fm\i ;\dfZiXk ;Xe FefiXkf Yp dfi\ k_Xe *,'#''' mfk\j XYflk 0 % J\im\[ knf k\idj Xj Xkkfie\p ^\e\iXc $ (00,$ (00. Xe[ )'',$)'((% @e )'('# _\ nXj Xdfe^ (+ Xkkfie\pj ^\e\iXc k_Xk ]`c\[ X cXnjl`k Z_Xcc\e^`e^ k_\ dXe[Xk\j f] k_\ e\n ][\iXc _\Xck_ZXi\ c\^`jcXk`fe% J\im\[ `e k_\ G\eejpcmXe`X EXk`feXc >lXi[ ]ifd (0.($(0/+# i`j`e^ kf k_\ iXeb f] ZXgkX`e%

that are possibly keeping Pennsylvania’s unemployment at 7.6 percent — down from 7.7 percent in 2011 — and unemployment claims are currently at a four-year low.

And although the state is faring better than other parts of the nation, former Gov. Rendell told Bloomberg Businessweek magazine, “Democrats can’t be compla-

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cent,” adding he believes President Obama will take the state.

Recent polls also suggest the state leaning toward President Obama, but with with room for Gov. Romney to gain.

The Center for Opinion Research at Franklin & Marshall College August 16 released its latest polling data concerning Pennsylvanians. The report stated, “President Barack Obama continues to lead his Republican challenger Mitt Romney, although his advantage is smaller than in June. The president enjoys significant advantages over Romney in his personal popularity and most voters believe he better understands their concerns.”

The data also indicated that there were less undecided voters in June 2012 at 15 percent than there were in August 2011 when at 21 percent. According to the “Presidential Horse Race” chart in the report, both Gov. Romney and President Obama increased their polling numbers in the past year. The candidates gained an identical 8 percent of polled voters, which placed them at 38 percent (Gov. Romney) and 44 percent (President Obama). If the undecided 15 percent were swung toward either candidate it would land him a solid victory in Pennsylvania in November, suggesting that the state is still in the air.

What is also yet to be determined is whether the state’s voter identification law will have an impact on the results.

Supporters of the measure say the new law will eliminate voter fraud and protect the integrity of the election. Opponents of the legislation feel it will disenfranchise voters, especially seniors and minorities.

Critics believe this is a partisan conspiracy since nine out of the 11 states that passed similar legislation had Republican governors.

They say the law will prevent up to 1 million voters in the state from getting to the polls because they lack the proper identification needed.

The judge in this case said he disagrees and believes that number is inflated and may only impact 1 to 9 percent of registered voters.

Nevertheless, if the law does in fact affect 82,723 to 744,507 of the state’s voting body, it is possible it could wipe out the lead Obama had in 2008.

That is, of course, all of those potential voters would be voting Democrat.

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Putting Polls Aside, History Favors Corbett Throughout the past century, Pennsylvania has seen major shifts in its political leanings.

At first glance, the state appears to be primarily a bastion for Republicans.

After all, since 1902, almost two-thirds of the governors came from the GOP. The GOP has dominated the early part of the 20th century, said Carol Jenkins, professor of political science at Temple University.

“They had a Republican machine in the state, and it also dominated the Philadelphia area,” she said. “Republicans had control nationally during the turn of the century until the depression — with the majority then becoming Democrat.” *** Since 1970, the governorship has been shared equally between both parties.

The greatest advantage in the race to become governor has been already holding the office. Since the turn of the century, every incumbent gubernatorial candidate won a sec-

ond term.

When there has been no incumbent, trends show that the party that currently holds office invariably loses.

Consider this recent history: Democrat Robert Casey won two terms.

He was succeeded by Republican Tom Ridge, who also won two terms (though his second was completed by Mark Schweiker). Democrat Ed Rendell won the next two elections and, once his time was complete, Republicans took the governor’s mansion with Tom Corbett’s victory.

When it comes to national elections, though, Pennsylvanians appear a bit more partisan. Over the last 100 years, Pennsylvanians voted for Democrats 1.3 percent more often than the nation as a whole. Since 1970, that trend has become more decisive, rising to 4.5 percent. *** But could Pennsylvania’s gubernatorial elections be influenced a presidential election held two years earlier?

Statistically, is a Romney victory more likely to help Gov. Corbett in his reelection bid than an Obama win?

The below

chart depicts the change in voter behavior between presidential and gubernatorial elections. If presidential races were able to predict the winner of the state’s race for governor, then both Republican Since 1900, fewer and fewer voters have cast ballots in both the and Democrat presidential and Pennsylvania gubernatorial elections. Less than 2 percent trend lines would of voters participated in only the presidential election at the beginning be straight and of the century; that number has climbed as high as 16 percent in recent close to horizon- elections.

(REBECCA CATAGNUS) tal axis of the Republican Lt. Governor Ray Brodgraph. This is not erick in Pennsylvania, and Richard the case.

This seeming randomness of these Nixon defeated George McGovern for statistics demonstrates that the presi- the presidency.) *** dential campaign does not dictate This disparity is in part because of Pennsylvania’s next governor.

The only clear indicator is which par- differences in voter turnout between ty is already in office and whether the the two elections.

As seen in the above chart, there in current governor is seeking reelection.

Over the past 110 years, only slightly an increasing tendency for Pennsylvamore Pennsylvanians (.23 percent) nians to vote only in the presidential voted for a Democratic presidential election. Only in the 1932-34 election candidate than a Democratic governor. cycle did more of the state’s residents More voters (1.44 percent) voted for a vote for governor (Democrat George Republican governor than a republican Earle defeated Republican William A. presidential candidate. (The opposite Schnader) than for president (Demooccurred in the 1970-72 presidential crat Franklin D. Roosevelt defeated and gubernatorial election cycles, when Republican incumbent Herbert Democrat Milton Schapp defeated Hoover.

Can presidential elections dictate Pennsylvania’s gubernatorial elections?

(REBECCA CATAGNUS)

If they could, both charted lines would be flat. This chart shows the percentage difference between which parties voters supported. The erratic movement shows no consistent connection.

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Early Portions of Dodd-Frank Act Take Toll on Community Banks ON DODD-FRANK

Federal Reserve Chairman Ben Bernanke last week: “I think it is important to emphasize that the vast majority of the provisions of the Dodd-Frank Act do not apply to community banks at all.”

ON MARKETWATCH.COM

Last month, the Cato Institute’s Mark A. Calabria wrote: “After two years of the Dodd-Frank Wall Street Reform and Consumer Protection Act, a few of the landmines hidden in its hundreds of pages are starting to come to the surface.”

IN THE WASHINGTON TIMES

Last week, Bloomsburg’s Phil Mattingly wrote: “Mitt Romney has pledged to repeal the Dodd-Frank act.

That’s not really going to happen — and that’s just fine with Wall Street.”

IN BLOOMSBERG BUSINESSWEEK

In March, Javier Palomarez, president and chief executive of the U.S. Hispanic Chamber of Commerce, wrote: “Regrettably, Main Street America — home buyers, consumers and small businesses — is starting to feel some of the unintended consequences of this important legislation.”

IN THE WASHINGTON POST

BY VINNY VELLA Since 2008, “Wall Street” has become a dirty term. Banks have been cast under a negative pall, and even the smaller firms doing business on Main Streets across America haven’t escaped unscathed.

To community bankers, it would seem that, in his efforts to end the era of “too big to fail,” President Barack Obama has made it tough for the small guys to succeed. And two more dirty words have since entered the banking industry’s lexicon: Dodd-Frank.

“Right now, the uncertainty in the banking world is tremendous,” said Dennis Cirucci, the treasurer of the Pennsylvania Association of Community Bankers.

“Across the board, the amount of available credit is down, and community banks are increasing the prices of their services and weighing if they’re even worth offering.”

In July 2010, the Obama administration’s Dodd–Frank Wall Street Reform and Consumer Protection Act fundamentally changed the way the financial industry was regulated, consolidating regulatory agencies into two new entities tasked with evaluating the risk of banks and ensuring accuracy in all lending practices.

When passing the bill, its legislators were clear in their intentions: to keep a closer eye on the national firms through new information-disclosure requirements. But community banks, which the Federal Reserve defines as institutions holding less than $10 billion in total assets, are having difficulty absorbing the responsibility of meeting the Dodd-Frank requirements.

“There have been significant additions to back-office personnel on the local level,” Mr. Cirucci, who’s also the president, chief executive and director of the Bromall, Pa.based Alliance Bank, said. “These community banks are taking valuable front line staff that could be working to increase revenue and using them to avoid fines that are often difficult to understand.”

Even more difficult is measuring exactly how much manpower is required. In a July 2011 report, the House Financial Services Committee estimated that it would take a bank 2,260,631 labor hours every year to meet the full scope of the new Dodd-Frank requirements.

REGION’S BUSINESS

But that number isn’t foolproof — as of this writing, approximately 70 percent of the act’s proposed regulations haven’t been put into effect, with some scheduled for public comment well into 2013.

“If 30 percent has been negative, it’s a little frightening, from our perspective,” said Craig Roda, the chairman and CEO of Fulton Bank.

“This is just the beginning.”

Mr. Roda said his company — which holds $9.2 billion in assets and operates branches in Pennsylvania, New Jersey, Delaware, Maryland and Virginia — has spent considerable amounts on complying with Dodd- Frank and is bracing for increased costs. Fulton already took significant hits to its debit card revenue under the act’s Derbin Interchange Amendment, which reduced its card fees by about 50 percent.

But it’s not all gloom-and-doom for Fulton; the bank has been able to increase its share over the past year in its existing markets, including residential mortgages.

“Our size puts us in a nice medium between larger banks, which some consumers don’t trust, and other banks that may not offer the same variety of services,” Mr. Roda said. “There’s a place for banks of all

sizes in the industry, a matter of finding the sweet spot and the best customer match.”

That seems to include Penn Liberty Bank, a small firm that serves the Chester County area and holds $560 million in assets.

“We feel we can compete with the larger banks on certain services, because pricing has been affected across the board,” said Brian Zwaan, Penn Liberty’s director and chief operating officer.

For Penn, the Dodd-Frank is a mixed bag: while its overhaul of the premium banks pay into the FDIC has saved it $100,000 a year, its new regulations have slowed down the loan process and have withheld revenue from the bank, which has had to sit on an ample amount of its capital as a precaution against future price hikes.

Additionally, a majority of the bank’s loans are commercially-oriented, and have been less impacted than other, larger consumer-oriented banks.

“Small banks may have trouble hitting their returns on schedule, but I’m confident they’ll still be successful,” Mr. Zwaan said.

“These banks are incredibly important to this country, and our success will breed success for smaller businesses and consumers as the economy slowly recovers.”

34

Q&A

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REGIONSBUSINESS.COM

RICHIE FURINO’S

HOSPITALITY BUSINESS

He may be the general manager of Del Frisco’s Steakhouse, but make no mistake, he’s NOT in the restaurant business.

This is the hospitality business and it’s all about one thing: People.

Richie Furino knows the restaurant business from the inside out. Actually, it’s probably more accurate to say he knows it from the bottom up. He started as a waiter 14 years ago and though he hasn’t left the company, he’s worked his way up to become general manager of Del Frisco’s Steakhouse on Chestnut Street.

What’s the elevator pitch for Del Frisco’s?

We’re hospitality-driven. We’re not in the food business, we just use food and drink to deliver hospitality. We’re all about people. When you step into Del Frisco’s, there’s a “wow!” factor.

It’s 25,000 square feet with a 60-foot ceiling ... there’s not a more physically beautiful building anywhere.

The restaurant business is a tough business. How do you stay ahead of it?

It’s all about the people. I go back to the restaurant I started at 14 years ago and a lot of the same people are still there. And 14 years? That’s like dog years - every year counts for seven, so it’s a really long time. We have very low turnover. People are the key to what we do.

Television seems to be featuring a lot of restaruants these days. Is what we see on TV what happens in your restaurant?

[Laughs] ... Not at all. We’re very organized, there’s no screaming or hollering. In our culture, we pride ourselves on how we treat our people. We praise in public and redirect in private, but there’s no Gordon Ramsey stuff.

How do you handle the mix of celebrities with the general public?

It’s a great place to meet, so we get

a lot of superstars. (Phllies first baseman) Ryan Howard called after the game the other night and said, “I’m starving. Could you stay open a little later?” Of course, we did. But it’s so cool. I was looking down on the bar the other night and saw a group of good-looking guys in their Armani suits. Right next to them were a bunch of athletes, including Juan Samuel and some of the Phillies coaches. Next to them were some hipsters with their beards and tattoos and then there were a bunch of guys in Phillies and Flyers jerseys. We’re really a melting pot and we treat everyone the same.

What questions should business people ask when booking a business event?

For us, it’s easy. You call our private coordinator, Jessica Kiefer, who’s the best in the city. We have a huge building and seven or eight different options. We have state-of-the-art AV equipment so people can just plug in their laptop and go. About 30 percent of our business is private bookings and that’s the number we were looking for.

There’s a big demand for that. But for us, it’s the same as dining room service for four. We staff it so we can execute like that..

How has the economic downturn hit you?

We’ve had unbelievable growth. We actually opened in 2008 when others were closing. We didn’t stray from our identity. We didn’t change our portions, we didn’t raise our prices, even though we were getting hit extra charges. We state consistent and weathered the storm. We stuck to our core values and I think customers appreciate that.

For more information, check out DelFriscos.com

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13 SEPTEMBER 2012

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West side condos: Academy House, The Rittenhouse Savoy, The Lanesborough,The Warwick, Parc Rittenhouse,The Barclay, The Dorchester, 250 S.18th Street,1820 Rittenhouse Square, 1830 Rittenhouse Square,1900 Rittenhouse Square, 220 W. Rittenhouse Square, The Rittenhouse, Rittenhouse Plaza, Wanamaker House, 250 S.17th Street, The Philadelphian.

The Bank Building: Brand new 2 bedroom plus den, 2.5 bath condo with high-end contemporary kitchen and baths, custom finishes throughout. 2025 square feet. $1,100,000.

220 West Washington Square: Entire floor home with 360 degree views including a Washington Square vista, amazing entertaining space, no detail has been left undone. 3720 square feet. $1,995,000

Society Hill Towers: Completely renovated and furnished corner one bedroom with dramatic city views, chef’s kitchen and designer bathroom. 803 square feet. $379,900.

The Barclay: 3 bedroom, 3.5 bath showplace, marble foyer, open living space, chef’s kitchen, high end appointments throughout. 3293 square feet. $2,900,000.

The Warwick: 3 bedrooms, 3 baths, 270 degree city views, open kitchen, lots of entertaining space, marble bathrooms. 2000 square feet. $1,050,000.

Parc Rittenhouse: Brand new 3 bedroom, 3 bathroom condominium with all rooms overlooking Rittenhouse Square, lavish finishes throughout. 1709 square feet. $1,475,000.

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42

13 SEPTEMBER 2012

REGIONSBUSINESS.COM

CHAMBER REPORT

WORLD AFFAIRS COUNCIL

SCHUYLKILL RIVER DEVELOPMENT CORPORATION

GREATER PHILADELPHIA CHAMBER OF COMMERCE

WAC, St. Joseph’s University to Hold Evening with Brokaw

9/11 Memorial Unveiled

2013 Excellence Awards Given to Small Businesses

The World Affairs Council and St. Joseph’s University will host a “Conversation with Tom Brokaw,” awardwinning NBC journalist and author of NYTimes bestseller, The Greatest Generation, on September 18 on St. Joseph’s campus.

Brokaw will discuss the evolution of the American dream and how the United States can achieve greatness in the modern age.

Admission is $40 to the general public and registration is now open through the WAC website, www. wacphila.org.

(COURTESY OF SCHUYLKILL BANKS)

SCANDINAVIAN AMERICAN BUSINESS FORUM

The Schuylkill River Development Corporation and the City of Philadelphia unveiled the 9/11 Memorial at the Schuylkill Banks Tuesday afternoon to honor the victims and heroes of September 11, 2011, including three Philadelphians who lost their lives in the World Trade Center.

Lecture to Highlight ‘2020 Ambition’

GREATER PHILADELPHIA CHAMBER OF COMMERCE

The Scandinavian American Business Forum will present a lecture September 18 at Montgomery, McCracken, Walker & Rhoads, LLP in South Philadelphia. Helge Hove Haldorsen will speak about his company’s “2020 Ambition” in the North American Market beginning at 6 p.m. Non-member tickets cost $60.

Hong Kong, Bangkok Trip Planned The Greater Philadelphia Chamber of Commerce will host a free informational presentation 6 p.m. September 13 about its nine-day trip to Hong Kong and Bangkok. Registration is free. The March trip costs $2,799.

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Greater Philadelphia Chamber of Commerce announced the winners of the 2013 Excellence Awards Honoring the Region’s Small Businesses this past weekend. Ten peer-nominated winners were selected from the 11-county region.

They are: -- Wil Reynolds, SEER Interactive , Small Business Person of the Year -- Avi Golen, Revolutionary Recovery, Young Entrepreneur of the Year -- Nigro’s Auto Body, Customer Service Excellence, Perryman Building and Construction Services -- Family Business of the Year, Spike’s Trophies\ -- Manufacturer, Pathways PA -- Non-Profit, Brownfield Science & Technology -- Professional Services Excellence, Philadelphia Runner -- Retailer, Jade Yoga Sustainable Business

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13 SEPTEMBER 2012

REGIONSBUSINESS.COM

OPINION

Sizing Up the Governor’s Performance Forget Polls, Biggest Issue Lies Ahead: Looming Pension Crisis

He’s Clearly No Obama, We Should Be Thankful For That

Halfway through his Since last spring, Gov. Corfirst term, Governor Tom bett has been talking about Corbett is about to face the need for pension reform his biggest political chalthat tackles those exploding costs. lenge — one that has little But enough of the talk. Now to do with polls but a lot to is time for action. do with the fiscal future of Gov. Corbett should prothe Keystone State.

Pennsylvania must pose immediate changes in face the growing and the benefit packages for future unsustainable costs of employees, including moving retirement benefits for Eric Boehm is the Harrisburg all new hires into a 401(k)public school teachers bureau chief for the Franklin style pension plan. and state workers. The Center for Government and Next, he should call for problem amounts to Public Integrity. changes to the future benefits about $40-billion liability of current employees. Allow in payments of benefits to retired public workers to keep all benefits they have school teachers and state workers. earned, but set a date in the near future In the coming years that figure will stop to roll all existing state and public school being an ominous sign at the bottom of a workers into the same 401(k)-style system. ledger and start having real consequences Here’s the kicker: Those two changes for the people of Pennsylvania. would do nothing to alleviate the $40 bilUnless changes are made, the state’s con- lion liability.

But they would at least keep the problem tributions to its two pension systems will climb from about $1.1 billion last year to from growing larger.

Only after moving all state workers and more than $4.2 billion in 2016 and more public school teachers into a sustainable than $5 billion by 2020.

That increase is like a “Pac-Man” eating pension plan can Gov. Corbett and the away at the state budget, Gov. Corbett has General Assembly start paying down that warned, and no matter what issue is impor- $40 billion liability. Doing so without a tax tant to you, the pension crisis will affect it. increase may prove impossible, but should The state cannot take on that additional be the goal.

There is no such thing as a quick-fix, but $3 billion without adjusting spending elsefinding a solution is critical and pension where.

Experts say discretionary spending like reform is one of those things that cannot funding for higher education is likely to be be left to the Legislature alone. The political costs are too high and the special interests a target.

Earlier this year, Moody’s said the state’s are too powerful.

Besides, we already know how that will pension costs were a major reason why it was downgrading Pennsylvania’s credit turn out.

The last time lawmakers tackled pension rating.

Gov. Corbett has not been shy about issues was in the fall of 2010, in the waning identifying problems, but he’s been unwill- moments of Governor Ed Rendell’s admining to use the bully pulpit to call for action istration. or lean on the General Assembly for soluBy that point, the lame-duck governor held little sway, and it showed. Political tions.

Generally, his message on any issue — interests trumped the best interest of the from privatizing the state liquor stores to state’s businesses and taxpayers.

The result was a “reform” so weak that charter school reform — has been “I’ll tell you what I think of it when the bill reaches even some of the architects now admit that it did little more than kick the can a few my desk.”

It’s an attitude that Gov. Corbett brought years down the road.

Gov. Corbett is the key to preventing that with him from his previous careers as diskind of weak result again in 2013. trict attorney and attorney general.

lower taxes and limited Let’s face it folks, it government. is hard being a Red Some of these reforms Governor in a Blue include changes to the State like Pennsylstate’s unemployment vania. Instead of compensation system, focusing on where a new school choice Governor Tom Corprogram that will help bett has missed the the students in failing mark, I want to focus schools, prison reform, on what the governor block grants for counties, has done right. and tax reform including The polls might phasing out the family show him down, but Anastasia Przybylski is the farm tax and phasing out are you surprised co-chair of The Kitchen Table the business asset tax. when he needed to Patriots and co-director of PA Fellow Pennsylvamake so many tough FreedomWorks. She resides in Doylestown with her husband decisions? nians, this is a huge list of Let’s start with the and three children. accomplishments. With burden of former these reforms our state is Governor Ed Rendell’s free spend- turning around.

Most of the governor’s critics voice ing ways. He left behind a legacy of debt that we’re going to be paying for objections similar to those of Penndecades to come. He left a huge budget sylvania state Representative Mike deficit for Gov. Corbett to try and fill. Sturla, D-Lancaster: “The budget did There’s no easy, quick fix to that. And nothing to make up for the deep fundyet, Gov. Corbett ing cuts to public schools has spent his time and universities.” resolving problems In this entitlement/nanleft by the previ- GOV. CORBETT ny-state culture, there will always be the shrill voices ous administration HAS MET HIS whining about not getting instead of remindCAMPAIGN enough while dining at pubing anyone who will listen that nothing PROMISE OF lic trough. was his fault. This BALANCING THE Under Gov. Rendell, we is because he knows BUDGET...’ were increasing spending in the d i ff e r e n c e these areas at an unsustainbetween fault and responsibility. able rate. We now need to live with the Gov. Corbett has met his campaign pain of realistic spending numbers. promise of balancing the budget two Just like in our personal lives, if we years in a row. We should be shouting have been running up our credit cards, this from the mountain tops and prais- it is painful and difficult to get back on ing the governor. But with balancing track. The end result is well worth it.

Pennsylvanians are tired of finger the budget comes tough budget cuts; this is where people get upset. No one pointing and appreciate effective manwants their favorite government pro- agement and leadership. Keep up the good work, governor. gram cut.

As Steve Forbes pointed out in a recent op-ed, “Corbett’s 2012-2013 JOIN THE CONVERSATION budget took a meaningful step — a long needed one — toward changing Send comments, letters and essays the culture of Pennsylvania govern- to feedback@regionsbusiness.com. ment from “tax and spend” to policies Opinions expressed by guest writers do that move in the direction of market not necessarily reflect those of Region’s based investment and job creation, Business.

13 SEPTEMBER 2012

REGIONSBUSINESS.COM

OPINION

45

Despite Sliding Polls, Pressure, Corbett Must Stay Course

A

midst the high-profile battle being waged between Mitt Romney and Barack Obama for the nation’s highest office, we have a situation developing here in Pennsylvania.

It’s not a terribly unique scenario: A governor sweeps into office promising to reduce government spending and introduce fiscal discipline. Midway through the first term, the budget cuts are beginning to take hold and some people are feeling the pinch.

The results are predictable, and the headline reads “Poll Numbers Drop.”

Such is the case with Governor Tom Corbett.

He rode into Harrisburg with some pretty tough rhetoric, something you would expect from a former attorney general. He promised austere budgets and, to his credit, austerity has been the hallmark of his spending plans.

While the financial results may be lauded, the impact on public opinion has been negative, and not just a little, either.

Recent polls showing that 52 percent of Pennsylvanians disapprove either “somewhat” or “strongly” of his record place Gov. Corbett squarely on the hot seat.

The numbers have sunk to the point where some state Democrats

and Democratic operatives believe they smell blood in the water, that Gov. Corbett could be vulnerable during his re-election bid in 2014.

That may seem like a long way off, but in the high-stakes, big money game of 21st century politics, it is not too early for such plans to form.

Much can change in two years, of course, but there will certainly be pressure applied to Gov. Corbett from within the GOP, pressure to soften some of his policies. In particular, there will pressure to loosen the purse strings a bit.

What Gov. Corbett is bound to face is more than simply pushback on his spending strategies. What we are about to see is a true test of his leadership capabilities.

If Gov. Corbett truly believes that he has set Pennsylvania on the right path, a path that will lead to reasonable spending by the state government while allowing the private sector to grow and flourish, then he must remain steadfast.

To begin to bend to the will of the polls would be a return to politics as usual.

It would be refreshing to see a politician, especially a high-profile one such as a state’s governor, to stick by principles, to stand firm in what he believes. As we watch over the next year or so, we will see what Gov. Corbett is truly made of.

COMMENTARY FROM ACROSS THE WEB Region’s Business combed the blogosphere, the Twittersphere and other corners of the web for interesting commentary over the past week or so. Here’s what we found.

Voter Registration Stuck in Dark Ages It’s ridiculous in an era where people are able to do just about any transaction online: bank, buy cars, apply for jobs and college, etc., that registering to vote is still strictly a paper process.

The irony is a person can check whether he or she is registered to vote online.

That means a public worker is manually imputing all that registration information. It would save everyone time and expense if a voter could simply fill out an online form.

EDITORIAL, 12 SEPTEMBER THE PATRIOT-NEWS

EDITORIAL BOARD CEO AND PUBLISHER | JAMES D. MCDONALD EDITORIAL DIRECTOR | KARL M. SMITH ASSOCIATE EDITOR | TERRENCE CASEY © COPYRIGHT 2012 INDEPENDENCE MEDIA 600 GERMANTOWN PIKE, SUITE 400 PLYMOUTH MEETING, PA 19462 610.940.1656 | WWW.REGIONSBUSINESS.COM

@Alex_Roarty Pennsylvania State Treasurer Rob [McCord]? ... If Casey passes, who else in a better position to challenge Corbett?

9 SEPTEMBER 2012

shifting from wage and business levies that have crippled job growth, must come next. That will take political courage — so far, lacking — to rightsize city spending and modernize the city’s tax structure. Without it, though, the jobs just won’t be there.

EDITORIAL, 10 SEPTEMBER THE PHILADELPHIA INQUIRER

Jobs Landscape Calls For Tax Reform

Court Should Reverse Voter ID Ruling

It’s critical to sustain a quarter-century of important investments in making Center City cleaner and safer, as well as exciting enhancements being planned at the West Philadelphia campuses of Penn and Drexel. Tax reform,

What Judge Simpson didn’t see, and which the state Supreme Court should rule, is that voting is a “fundamental right.” Attempts to place a burden on it should be subject to “strict scrutiny.”

That is, the government must

prove that it is acting to fix a compelling and serious problem and that the law won’t affect rights any more than is necessary. ” EDITORIAL, 11 SEPTEMBER PHILADELPHIA DAILY NEWS

Obama Gets Bump From Convention The Obama bounce coming out of the Democratic convention cannot be ignored in a race as close as this one.

His uptick appears to be at least five points, possibly larger. Obama now leads 49 to 44 percent in the Gallup tracking poll, the largest lead since April. In such a tight race with few undecided voters remaining to weigh in, Romney’s task looms formidable.

TERRY MADONNA & MICHAEL YOUNG, 12 SEPTEMBER, MORNING CALL

FEEDBACK Send your thoughts to feedback@regionsbusiness. com. You can also reach Editorial Director Karl Smith at 610.940.1656.

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46

13 SEPTEMBER 2012

REGIONSBUSINESS.COM

BY THE NUMBERS

$9,545

1,000

The value of TransPasses unaccounted for in Philadelphia’s schools.

$9,512

71,000

More than

people responded to a survey about Philadelphia International Airport, conducted by Select Greater Philadelphia and the CEO Council for Growth.

The number of jobs Paul Levy, executive director of the Center City District, says the city could lose by 2021 if the city’s tax structure isn’t changed.

The average cost in Pennsylvania to educate a public school student. Often referred to as cost per pupil.

$4,000

68,532

The amount of grant money awarded to Temple University to support its academic program in local prisons.

Seating capacitiy of Lincoln Financial Field, home of the Philadelphia Eagles.

54.4%

$42,339

Average annual cost to incarcerate a prisoner for one year in Pennsylvania.

$200

The amount Hyundai Rotem, Co. is charged for each day late in delivering SEPTA’s new Silverliner V trains.

$200

The minimum fine imposed

by Major League Baseball for intentionally throwing at a batter.

$229

Cost of a room for September 13 at the Residence Inn by Marriott near the Philadelphia Airport, according to the Hotels.com website.

Percent of the vote won by Tom Corbett during the 2010 gubernatorial election.

Most-desired non-stop international business destinations

Most-desired non-stop international leisure destinations

Most-desired non-stop domestic business destinations

Tokyo, Japan Shaghai, China Beijing, China Mumbai, India Milan, Italy

Milan, Italy Vancouver, Canada Sao Paulo, Brazil Tokyo, Japan Buenos Aires, Argen.

Orange County, CA Austin, TX Honolulu, HI San Jose, CA San Antonio, TX RICK DIKEMAN

Most-desired non-stop domestic leisure destinations Honolulu, HI Austin, TX Orange County, CA San Jose, CA San Antonio, TX

$12.99

Cost of a single, official Major League Baseball ball, found on The Sports Authority website.

$100,000,000 The amount Temple University hopes to raise over the next five years to fight student debt.

$2,000,000,000 The estimated worth of the Horsham-based Motorola Home unit Google reportedly intends to sell.

56%

Likely Pennsylvania voters in the fall election who say they believe the state is headed in the wrong direction, according to a recent edition of The Philadelphia Inquirer’s Pennsylvania Poll.

3%

The Phillies chance of making the playoffs as of Wednesday, September 12, according to ESPN.com. It was 1.5 percent on September 11 and 0.6 percent on September 10.

A 20 minute drive turns married with children into entourage. step into epic 20 minutes from Philly

must be 21. gambling problem? call 1.800.gambler.

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