PHASING OUT ‘BUSINESS PRIVILEGE’ THE CHOICE: SOCIAL MEDIA OR SEO?
COURT MULLS VOTER ID; STATE EASES STANDARDS
REGION’S BUSINESS
PHILADELPHIA EDITION
A JOURNAL OF BUSINESS AND POLITICS
STATE’S WINE INDUSTRY WORTHY OF A TOAST It’s taken equal measures of patience, persistence and creativity, but Pennsylvania wineries are a major contributor to the state’s economy.
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CONTENTS
3
Worthy of a Toast
19
It’s taken time, persistence and creativity, but the Pennsylvania wine industry is now a major factor in the economy, especially here in the Delaware Valley.
!
City Keeps Phasing Out ‘Business Privilege’
The terminology is no longer being used, though the taxes and fees remain. !
20 1900 Arch Street 1900 Arch Street is a premier mixed use development project in the Logan Square section of Philadelphia. Scheduled for completion in Fall of 2013, the project will feature 280 luxury apartments, private parking, and 16,333 SF of ground floor retail.
17
What Will Move ‘Swing Voters’?
! Romney’s debate performance could outweigh the impact of early voting in Pennsylvania.
Comcast’s Low-Cost Internet Program: Why You Should Care
26
More SEO or More Social Media?
! Big names - Michael Nutter, Tony Dungy, Dr. William Hite - were on hand for the kickoff of Comcast’s Internet Essentials program, but Comcast exec David Cohen explained why his peers should take notice.
Getting your message out means leveraging both channels.
!
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PRESIDENT AND PUBLISHER James D. McDonald EDITORIAL DIRECTOR Karl M. Smith
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EDITOR’S DESK
Wine and Culture Good for Our Economy
Karl Smith is the Editorial Director for Region’s Business. You can contact him at ksmith@regionsbusiness.com
Let me say right up front that I’m no wine connoisseur. I’m more partial to a hoppy lager than a crisp Pinot Grigio, to a smooth bourbon than a full-bodied Pinot Noir. I know a little about wine just enough to be dangerous, I suppose. I know more about the business, though, thanks in no small part to a really smart lady named Kimberly Graziano. She’s the event planner for the Chaddsford Winery outlet in Bucks County’s Peddlers Village. Last year, I did a piece for Patch.com on pairing wines for Thanksgiving Dinner and Ms. Graziano graciously shared her expertise and experience regarding wine. In addition to learning that you could, in fact, have both red and
white wine on the same table, I learned about some varieties I had never heard of before including viognier and ice wines. But I also got some important perspective on the industry. I asked her about some people dismissing the wines of the region as inferior. In a nutshell, she said that was an outdated premise, though it made sense years ago. Of course it did, since the vineyards of France and Italy head a headstart literally some centuries long in picking out the right grapes for the right soil and climate, refining cultivation techniques and, of course, tweaking the way they make wine. The state’s wine industry may not be a mature business yet, but it’s certainly growing up fast and showing that it will likely have
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some legs. This is a testament to the vision and persistence of the vineyard owners, who dismissed criticism and followed their passion. We’re excited to be able to share some of their story in this week’s edition. Speaking of success stories, I was lucky enough to be invited to a great press event last week, hosted by the Greater Philadelphia Tourism Marketing Corporation. The “speed reporting” event allowed about a dozen of the region’s major cultural outlets to talk briefly about all the great things they have on tap. The list was exhaustive, impressive and exciting. This follows a recent report on the dramatic economic impact that the arts are having on our local economy, something we reported
on a few weeks back as part of our Visions of a World-Class Philadelphia series. It’s another example of how the region has found a niche. In both instances, there were established players, dominant players - Italian and French wines, the cultural scene in New York City. In both instances, a small handful of very smart people in the Delaware Valley smiled, put their shoulder to the wheel and did what they loved. In the end, they not only built successful businesses, they also created the kind of economic impact that the empty suits in Washington always yammer about but never seem to accomplish. Business overcoming political rhetoric? We should all raise a glass of Pennsylvania sparkling wine to that.
27 SEPTEMBER 2012
REGIONSBUSINESS.COM
WEEKLY BRIEFING
ATLANTIC CITY
UNEMPLOYMENT
Port Authority Considering Airport Takeover
State Jobless Rate Continues Climb The state jobless rate saw another upward surge in August, increasing to 8.1 percent from 7.9 percent in July and hitting the same rate as seen on the national level for the first time in six years. A report from the state Department of Labor and Industry claims that Pennsylvania maintains a total of 5.7 million jobs, which is even with the number of jobs available in October 2011, but fewer than the number available in 2005. The rate has increased by seven-tenths of a percentage point since hitting 7.4 percent in March and April earlier this year. By comparison, New Jersey ‘s numbers are on target to hit a four-decade high, with a 9.9 percent unemployment rate that hasn’t been seen since the 1970s.
The Port Authority of New York and New Jersey has formally approved a $3 million exploratory process to study the possibility of taking over operations of Atlantic City International Airport. The money will be spent analyzing financial, legal and environmental issues surrounding the newly-renovated airport, ultimately aiming to determine whether the Authority operating the flight hub would decrease congestion at John F. Kennedy International, LaGuardia and Newark Liberty airports, as well as possibly increase attraction to Atlantic City’s casinos. “Atlantic City International Airport may provide a good fit with our current air operations, easing congestion and opening up new opportunities,” said Port Authority Chairman David Samson in a news release. TAXES
Pew Study: City’s Tax Disadvantage Shrinking
The Pew Charitable Trusts’ analysis of 237 municipalities in both Pennsylvania and New Jersey in its new report “Residential Taxes: A Narrowing Gap between Philadelphia and its suburbs” found that Philadelphia’s tax disadvantage has decreased since 2000. The decrease, from third-highest tax burden in the region to 48th, comes as a result of two primary factors: the slight decrease in Philadelphia wage tax compared to suburbs that have raised earned income taxes, and the significantly fewer number of properties in the city that have been reassessed in the 12-year period. The study shows the highest tax burden was placed upon commuters from Philadelphia’s suburbs who come into the city for their jobs.
5
ECONOMY
City Manufacturing Activity Decreases Comcast Executive Vice President David Cohen (above left) led a high-profile lineup that included new Philadelphia schools superintendent Dr. William Hite (top right), former NFL coach and current NBC sports commentator Tony Dungy (middle right) and Philadelphia mayor Michael Nutter (bottom right). PHOTOS BY REGION’S BUSINESS
Why Execs Should Care About Low-Cost Internet Comcast held a big kickoff event for its Internet Essentials program last week at the city’s Constitution High School. A lineup of high-profile speakers, including Mayor Michael Nutter and Comcast CEO Brian Roberts touted the initiative aimed at getting low-income families inexpensive computers and low-cost Internet access. Mayor Nutter called the digital divide “the great civil rights issue of our day” and Philadelphia schools superintendent Dr. William Hite talked about academic achievement. Comcast Senior Vice President David Cohen touched on those topics, too, but when asked why business executives should care, he had a quick answer. “I can’t imagine anything more important to business leaders than
Internet Essentials” he said. “It is absolutely demonstrable that access to the Internet is essential to a quality education.” And quality education is a key component for something most every employer wants — quality employees. “This all leads to a better educated workforce and a workforce with 21stcentury skills,” Mr. Cohen said. “I haven’t met a business leader yet who doesn’t want to develop a better workforce.” He added this practical note, too: “If you’re focused on improving educational outcomes, giving the kids the opportunity to finish school and go on to college, to apply for jobs, access to the Internet is crucial. Eighty percent of the Fortune 500 today only accepts job applications online.”
Manufacturing in the region diminished for the fifth consecutive month in September. The Federal Reserve Bank of Philadelphia, which measures reports from manufacturing firms in the Pennsylvania, Delaware and New Jersey region, said that 23 percent of firms noted decreases in activity. Activity surveys indicated a manufacturing index reading of -1.9 in September, slightly better than August’s reading of -7.1, but still a firm indicator of a manufacturing decline. The decline in the Philadelphia region is largely attributed to the same reasons attached to national manufacturing woes. BANKS
Philly Has Worst ATM Fees Bankrate.com reports that Philadelphia banks charge more in fees to their customers than any other collective group of city banks in the nation. The average fee for out-of-network withdrawals in Philadelphia is $1.96, 39 cents higher than the national average. By comparison, Baltimore charges $1.12, and Chicago charges $1.10. However, Philadelphia is on par with the rest of the nation and 12th among the 25 major metropolitan centers, boasting non-customer surcharges of $2.50. Among the 25 cities analyzed, Philadelphia had the ninth-highest overdraft fee charge, standing at $31.70.
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27 SEPTEMBER 2012
REGIONSBUSINESS.COM
WEEKLY BRIEFING
EXECUTIVE BOOKSHELF
Acknowledging the Independents Jacqueline Salit, a political commentator whose work has appeared in dozens of publications including USA Today and The Huffington Post and has been featured on CNN, MSNBC, and FOX, just released her newest piece, Independents Rising: Outsider Movements, Third Parties and the Struggle for a Post-Partisan America, which gives a voice to the almost 40 percent of Americans selflabeled as Independents. She currently serves as the president of IndependentVoting.org. “For over 30 years Jackie Salit has been one of America’s most important thinkers and leaders on independent politics. Filled with history and personal stories of life inside the political process, this book is a must read for all citizens who are frustrated by the exclusionary and self-reinforcing power of our two major parties. She is a true patriot who bravely offers a new path forward,” said Josh Rosner, co-author NYT Bestseller Reckless Endangerment.
WHO TO FOLLOW
@wilreynolds Wil Reynolds, Founder and CEO of SEER Interactive “...finding great talent isn’t easy, then convincing that talent to come to your potentially risky startup is hard too.” -- September 13, 2012
PEOPLE
Table Game Revenue Increases in August
Local Billionaires Named to Forbes 400 Wealthiest List
Pennsylvania’s table games gross revenue saw a year-over-year increase of 11.1 percent in August. Pennsylvania’s 11 casinos totaled $59.9 million for the month, up from $53.9 million in August 2011. Parx Casino, Harrah’s Philadelphia Casino, Racetrack, The Meadows Racetrack & Casino, Presque Isle Downs Casino and Mount Airy Casino Resort all saw slight declines in gross revenue.
Mary Alice Dorrance Malone of Coatesville, Pa. and Richard Hayne of Philadelphia each landed a spot on this year’s Forbes 400. Malone, ranked at No. 190 on the list and worth $2.4 billion, inherited much of her wealth from Campbell Soup Co. Hayne is the co-founder and current CEO of Urban Outfitters, Inc., which is responsible for developing the popular retail clothing brands of Urban Outfitters, Free People and Anthropologie, coming in at No. 328 on the list and reportedly worth $1.4 billion.
MUST-HAVE APP MUSEUMS
Philadelphia History Museum reopens after 3 years After closing in 2009 for renovations, the Philadelphia History Museum — renamed the Atwater Kent — has opened its newly-renovated, $6 million doors to the public. The rebuffed museum, in addition to featuring infrastructural changes in the form of new plumbing and electrical installations, features neverbefore-seen pieces such as a second-floor portrait of abolitionist Harriet Lee Smith, with iPads now lining broadened exhibit spaces in place of standard-fare information slabs. Other exhibits demonstrate the city at “work and play” through the years, placing
VENTURE CAPITAL
(PHILADELPHIA HISTORY MUSEUM AT THE ATWATER KENT)
emphasis on the city’s culture of “beer and baseball.” The museum is open Tuesday through Saturday between the hours of 10:30 a.m. and
LAW
First Round Invests in Dorm Room Fund First Round Capital, a nationally-focused, tech-oriented venture capital firm that recently transplanted its headquarters to West Philadelphia, will invest in Philadelphia’s first Dorm Room Fund. First Round will commit $500,000 in capital to the student-run investment fund in search of the next “Half.com,” with funds allocated to startups founded by students attending universities in the city. The fund
GAMING
will be set up on campus by eight students hand-selected by the firm, with future replacements being chosen by students. “College campuses are wonderful ecosystems for creating disruptive ideas,” said First Round Capital co-founder Josh Kopelman. “Choosing Philadelphia as our first city underscores my commitment to creating a stronger and more vibrant...start-up community.”
Cozen O’Connor Announces Leadership Plan Cozen O’Connor, a Philadelphia-based law firm, announced a multiyear succession plan September 24 that will have Michael Heller assuming the position of COO and current CEO, Thomas A. Decker, stepping down to vice chairman, effective January.
4:30 p.m., with an admission price of $10 for adults, $8 for seniors, $6 for teenagers and students, and free for children under the age of 12.
Philly 311 You knew your smartphone could make you become a better businessman, but now it can also make you a better Philadelphian. The free Philly 311 mobile app (available for iPhone, Android or BlackBerry) is a real-time civic engagement platform designed to empower Philadelphians to be community heros by reporting neighborhood issues such a graffiti, potholes, litter and more directly to the relevant city government systems. Simply submit a report and it will automatically generate a work order with the appropriate government office. When your request is resolved, you’ll be automatically notified by the app.
GOTTA HAVE IT GADGET
MWE Emperor 200 This PC workstation completely eliminates the need for a desk — and a computer, for that matter. The “Emperor” boasts three LCD touch panels seamlessly integrated into a sleek, high-tech station with an electric-powered leather seat and an impressive air filtration system. Though priced at a steep $45,000, the product screams “unique,” even allowing for customization of the station’s aesthetics and tech specs.
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BUSINESS PROFILE
Accolade Defies Convention, Defines New Industry Position Accolade, Inc. could be considered many things, but conventional is not one of those things. Accolade launched in 2007 with the goals of simplifying standard interactions with health insurance companies as well as cutting costs within an industry that continues to become more difficult to navigate, effectively manifesting its commitment to these health care ideals through the creation of the company’s key asset: the health assistant. Accolade’s health assistants, who train for a rigorous eight weeks upon being hired, serve the unique function of streamlining interactions between employees of large companies and their health care providers.
These individuals, assigned to employees and their families, do everything from scheduling appointments to calling in claims questions. “An Accolade health assistant comes to us with a couple of key characteristics. I think, fundamentally, they’re empathetic people — they’re wired for service and they are knowledgeable about health care and the health care system,” said Amy Loftus, chief information officer and executive vice president of capabilities for Accolade. Ms. Loftus said the company maintains roughly one health assistant for every 900 families, with 60 percent of those families using their services every year. Many of these employees come from large, recognizable
companies like Metronic and Lowes, with Accolade’s firstever customer being Philadelphia’s Comcast Corp. “Large employers continue to seek unique ways to control health care costs, which are rising at two times the rate of inflation,” Ms. Loftus said. “Also, our large employer customers desire to engage their employees in new ways — they want a highly satisfied workforce, a highly productive workforce, and a healthy workforce.” The company’s gamble on the health assistant, which the company dubs as “a whole new profession,” paid off with its inclusion in the Inc. 500 list as the benchmark example for private health care companies, coming in at No. 33 on the list follow-
ing three years of growth, culminating in revenues of $17.9 million in 2011, up 5,866 percent from its 2008 revenues of $300,000. “There is really no one that provides the services as we do in our model with an Accolade health assistant, [who is] dedicated to an employee and their family with the same focus in terms of helping large employers control their costs, engaging a workforce in a very different way and navigating the health care journey. There are others out there that are similar, but they really are not the same model as Accolade,” Loftus said. Having launched their new office at 660 W. Germantown
Pike in Plymouth Meeting just last week, Accolade continues to grow, employing an all-time high workforce of 320 people that, according to Loftus, will allow the company to move forward with plans to expand its audience. “It isn’t that the health care landscape is becoming less complex — it’s actually becoming more complex, so there will continue to be an increasing need for our services.” — Brandon Baker
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DEALBOOK
SPORTS
PHARMACEUTICAL
Revitalization Plan Costs Total $272M
KoP Business to Supply US Flu Vaccine
City Center Investment, Hammes Sports Development Group and the Allentown Neighborhood Improvement Development Authority are teaming up to fund the $272 million revitalization project for the block at Seventh and Hamilton streets in Allentown. The plan centers around an 8,500seat hockey arena and banquet facility for the Flyers’ top affiliate, the Phantoms. A 180-room hotel and an eightstory office complex will flank the arena. All three projects should be completed by 2014. About $234 million of the project funding will be provided through a bond sale the Allentown Neighborhood Improvement Development Authority is expected to conduct next month. City Center will contribute $3.5 million a year for 30 years in revenue generated by its City Center Wholesale business to help the city repay bonds, as well as about $38 million in separate funding to complete construction. Development efforts are expected to improve the Lehigh Valley economy by drawing millions of people to the area.
49ers CEO Jed York, left, shake hands with SAP CEO Bill McDermott. (SAN FRANCISCO 49ERS)
49ers, SAP Partner On Stadium Name The German business software giant SAP, which has its North American headquarters in Newtown Square, Pa., has agreed to become a founding partner in the San Francisco 49ers’ new stadium in Santa Clara, Calif., that is scheduled to open in 2014. Terms of the deal include an agreement in which SAP will develop human resources and other systems for the franchise among other services and the Niners will rename their practice facility, which is adjacent to the site of the new stadium, the SAP Training Center.
The U.S. Department of Health and Human Services has awarded a contract to CSL Biotherapies to supply pre-pandemic and pandemic influenza vaccine antigens and related services to the U.S. national stockpile. If all optional activities are exercised over the duration of the contract, it has a maximum potential value of slightly more than $1.5 billion. CSL Biotherapies, headquartered in King of Prussia, is a subsidiary of Melbourne, Australia-based CSL Limited, one of the world’s leading manufacturers of influenza vaccines.
DEVELOPMENT
(UNISYS)
Long-Term Proposal For Unisys Property Creates 10 Buildings
(U.S. ARMY CORPS OF ENGINEERS PHOTO BY CAROL E. DAVIS)
Licensing Deal Worth More Than $500M Onconova Therapeutics signed what may be the biggest Philadelphia-area biopharmaceutical licensing deal of the year Wednesday with Baxter International. Baxter, which already has a $50 million equity investment with Onconova, agreed to pay $50 million up front, and another $515 million in potential milestone payments, for the European rights
to rigosertib, an anti-cancer compound. Rigosertib is in the late stage of testing by Onconova as a potential treatment for a group of rare hematologic malignancies, as well as for pancreatic cancer. The funds will help advance the rigosertib program toward clinical development and commercialization and the deal includes the option for Baxter to participate in those efforts.
In a meeting with Whitpain Board of Supervisors on September 18, representatives from Corporate Office Properties Trust (COPT), a publiclytraded real estate investment firm focused on developing and managing office properties, presented a longterm master plan for the property currently known as Arborcrest in Blue Bell, Pa. The plan calls for a transformation of the former Unisys property into a 10-building office campus with 1.6 million square feet of office space as well as a parking structure and on-site lake and trail for township residents. Wayne Lingafelter, president of COPT’s development and construction division, indicated that the plan may take 10 to 15 years to implement.
DEVELOPMENT
RETAIL
PREIT Buys Building for Gallery Overhaul
Burlington Coat Factory Approaches Landmark Opening of 500th Store
Pennsylvania Real Estate Investment Trust is buying the 430,000-square-foot office building at 901 Market St. from New York real estate investment trust, Vornado Realty Trust. The purchase will allow PREIT increased flexibility as it solidifies plans to overhaul the Gallery into a more modern, upscale urban mall. Acquisition and renovation costs are projected at roughly $300 million. PREIT had hoped to begin redevelopment at the Gallery last year, but the process was slowed due to the property’s complex ownership structure involving PREIT, the Philadelphia Redevelopment Authority and SEPTA has slowed the process. PREIT purchased the 1.1 million-squarefoot-space in 2004 from Maryland-based retail real estate company Rouse Co.
Burlington Coat Factory officials recently revealed to investors plans to open the company’s 500th store by the end of this year. According to Chief Financial Officer Todd Wyhrich, the company has opened 20 new stores since 2011. In June, it was announced that the Burlington Township, N.J.based company would not only remain in New Jersey, but it also plans to build a new $41 million, 180,000 square-foot headquarters on 50 acres in Florence, N.J. Burlington Coat Factory is owned by the private equity firm Bain Capital.
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REGIONSBUSINESS.COM
DEALBOOK
FOOD INDUSTRY
LAW
TECHNOLOGY
Hershey: New $300M Plant to Add $1B to Economy
Dechert Secures License to Open Chinese Branch
Evolve IP Acquires Assets of Illinoise Company
The Hershey Co. opened a $300 million plant September 18 in West Hershey, Pa. The 340,000 square-foot state-of-the-art plant will operate around the clock to produce Hershey’s Bars and other chocolate products. The plant, which can produce up to 70 million Hershey’s Kisses a day on a single line, is expected to have a $1 billion impact in Pennsylvania over five years.
Philadelphia-based law firm Dechert has secured the license to operate in Shanghai, China, that it applied for in May of this year, according to Legal Week. The new office will likely open later this year and comes after a string of expansions in Frankfurt, London and Dubai. Shanghai will be the firm’s 25th office overall and 13th on foreign soil. RETAIL
APARTMENTS
BET Purchases Complex for $25M In an effort to increase its multifamily holding in the Philadelphia area, BET Investments Inc. has acquired the Chesterfield apartments complex in Levittown, Pa., from Home Properties Inc. for about $25 million. Average units are about 711 square feet and cost about $1,050 per month. The property was 96 percent occupied at the time of the sale.
Wayne, Pa.-based Evolve IP has acquired the assets of IPiphany, a managed communications provider headquartered in Rolling Meadows, Ill., just outside of Chicago. Since 2011, IPiphany has delivered managed IT, voice and data services to the Midwest marketplace. After integrating with Evolve IP, IPiphany customers will gain access to a wide array of new private cloud services including hosted VDI, data back-up and cloud-based unified communications.
Franklin Mills Shopping Center Adds LOFT, AE, Pretzel Factory
FINANCIAL
Franklin Mills shopping center announced last week that it will add LOFT Outlet, American Eagle Outfitters and Philly Pretzel Factory locations to the 200-store Philadelphia shopping center. Franklin Mills is part of The Mills group and is owned by Simon Property Group.
Horsham-based Penn Mutual Life Insurance Co. announced last week that it has made a strategic investment in Leap Systems, a Bridgewater, N.J.-based company that provides financial modeling systems for financial service professionals.
Penn Mutual Invests in Leap
27 SEPTEMBER 2012
REGIONSBUSINESS.COM
POLITICS ELECTION 2012
VOTER ID
Republicans Back Romney Comments
As Court Mulls Voter ID Law, State Eases Requirements
Republican presidential candidate Mitt Romney took fire from Democrats and pundits when some of his secretly-taped comments were made public last week. Gov. Romney said during a May fundraiser that 47 percent of Americans do not pay taxes, consider themselves victims and will undoubtedly vote for President Barack Obama.
WHAT [GOV. ROMNEY] IS COMMENTING ON IS A NUMBER OF PEOPLE WHO ARE NOW DEPENDENT ON THE GOVERNMENT, AND THAT HAS CONTINUED TO GROW UNDER THIS ADMINISTRATION.’ — PENNSYLVANIA GOVERNOR TOM CORBETT,
As supporters of Pennsylvania’s new Voter ID legislation defended the controversial law in Commonwealth Court , the Pennsylvania Departments of State and Transportation took action of their own. The two agencies jointly announced that Pennsylvania residents need only to provide their name, birthday, social security numbers and address in order to receive a voting-only ID. It is not necessary to provide proof of residence, according to PoliticsPa.com. In response to seniors who claimed they were not able to make multiple trips to offices, PennDOT declared that it will mail the ID card to anyone whose problems cannot be resolved in someone’s first visit. “We believe these updates to our process will meet the Supreme Court standard that voter ID cards be liberally accessible,” said Carol Aichele, Secretary of the Commonwealth, according to PoliticsPA.com. Additionally, 48 PennDOT centers that are normally closed on Mondays will be open November 5, the day before Election
Day, according to The Patriot-News. “We are in the business of issuing people IDs, not denying people IDs,” Kurt Myers, a PennDOT deputy secretary in charge of driver’s licensing, said in his testimony Tuesday, according to PennLive.com. Mr. Myers added that about 10,800 cards have already been issued. On Tuesday, Commonwealth Court Judge Robert Simpson indicated that he could rule in favor of blocking at least part of the legislation for the November election. Judge Simpson had asked both sides in the case to tell him what they would like to see in a potential injunction. “I think it’s possible there could be an injunction entered here,” he said, according to the Pittsburgh Post-Gazette. Opponents of the Voter ID plan claim that PennDOT and the new law could disenfranchise Pennsylvania voters, including up to 52,000 Latino voters. The Advancement Project, a civil rights
15
organization, claims that PennDOT employees are not properly trained in distributing the new, votingonly IDs and have turned potential cardcarriers away, according to Philly.com. This claim was refuted by the Department of State. Judge Simpson began hearings again Tuesday after a Supreme Court ruling required him to reconsider the case based on voters’ access to IDs rather than the state’s right to create such a law. Hearings were expected to continue through Thursday.
DURING A CAMPAIGN NEWS CONFERENCE
SOME PEOPLE IN THE MEDIA SHOULD JUST TURN IN THEIR MEDIA CREDENTIAL AND GET AN OBAMAFOR-PRESIDENT CREDENTIAL, THE WAY THEY FOCUS ON THINGS THAT PEOPLE SAID BACK LAST MAY.’ — NEW JERSEY GOVERNOR CHRIS CHRISTIE,
ATTORNEY GENERAL
STATE
Candidates Raise More Than $2.5M Kathleen Kane, the Democratic candidate for Pa. Attorney General, has raised $1.77 million since the April primary. Her campaign announced the figure Tuesday and said that she has $1.44 million cash on hand. The figure includes
$300,000 Ms. Kane says she raised since September 17, largely as a result of being targeted by a national GOP group. Republican Dave Freed raised $869,000 and has $1.02 million on hand, according to the Allentown Morning Call. — PoliticsPA.com
NEW JERSEY
ON NEW JERSEY RADIO 101.5
[GOV. ROMNEY’S] POLICIES WILL CREATE JOBS, GENERATE NEW WEALTH, AND ALLOW PEOPLE FROM ALL WALKS OF LIFE TO ACHIEVE THEIR FULLEST POTENTIAL.’ — SENATOR PAT TOOMEY, IN A STATEMENT DISTRIBUTED BY THE ROMNEY CAMPAIGN
Poll: Menendez Holds 14-Point Lead The most recent Fairleigh Dickinson-PublicMind poll shows U.S. Senator Bob Menendez holding a 14-point lead over his opponent, Republican state Senator Joe Kyrillos. The telephone survey Menendez Kyrillos included 706 participants of likely voters and was conducted from September 6-12. A Republican has not represented New Jersey in the Senate since the 1970s.
Former Rep. Stetler Sentenced A former high-ranking state representative was sentenced to 18 months to five years in prison this week. Former Pennsylvania Rep. Stephen Stetler, 63, had been convicted of using state employees for personal campaign work. The charges include felony counts of conspiracy and conflict of interest and four counts of theft. It was the final step in a years-long Stetler case that started with an investigation of the Legislature by the Pennsylvania attorney general’s office. Stetler had represented his district for 16 years. ELECTION 2016
I’M HOPING THE LURE OF BEING THE FIRST WOMAN PRESIDENT IN THE HISTORY OF UNITED STATES WOULD BE TOO GREAT FOR HER TO RESIST, AND I WOULD AID HER IN ANY WAY I COULD.’ — FORMER PA GOVERNOR ED RENDELL ON HILARY CLINTON, AS QUOTED BY PHILLY.COM
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27 SEPTEMBER 2012
POLITICAL COMMENTARY
REGIONSBUSINESS.COM
17
Romney’s Debate Performance Could Outweigh Early Votes
Charlie Gerow is CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm. CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
What will move the much ballyhooed “swing voters” who will tip the 2012 election? Most pundits say their decisions will hinge on the candidates’ performances during the debates. Some go so far as suggesting that it may come down to how they view the vice presidential debates. There’s certainly some truth to their assertions. Debates, especially the first debate of the series, have proven to be catalysts if not game-changers in close presidential elections. The first debate has often focused or crystallized perception of candidates in the voters’ minds, a position that is difficult to change once burned into the psyche. But a growing national trend may make the later debates less relevant this time. It’s called “early voting.” Early voting means that by the time Mitt Romney and Barack Obama walk onstage in
Boca Raton, Fla., to chat about foreign policy with CBS’ Bob Schieffer and a national television audience of millions, in several states many if not most voters will have already cast their ballots. For Pennsylvanians that’s somewhat difficult to imagine. We vote at a specific polling place in our own neighborhood between 7 a.m. and 8 p.m. on November 6, unless we have provided a valid reason and obtained and cast an absentee ballot. But in several states, mostly in the West, they’re already voting. Most states where voting is underway are voting by paper — either by mail or “no excuse” absentee ballot (all you need do is ask) — but some, like South Dakota and Idaho, have already opened the polls at select locations. A couple of states on the Left Coast now vote exclusively by mail (Oregon and Washington), and many states have areas within
them that use mail exclusively. A majority of states allow “no excuse” absentee balloting, and two-thirds provide for in-person early voting. Many analysts wonder aloud how long it will be before computerized voting widens the window of voting even further. Many experts predict as many as 40 percent of all votes will be cast prior to November 6 this year. That’s up from four years ago when the number was roughly one-third, and it’s a dramatic increase from 2000 when less than 15 percent of votes were cast prior to Election Day. In certain states the number may be as high as 80 or 85 percent. Key “battleground” states like Colorado, Iowa, Florida, Nevada, North Carolina and Ohio all have early voting. In fact, attempts to change the early voting rules in Ohio and Florida have been met
with federal court challenges. Nevertheless, the debates will still be critical. The first looms especially large. It’s historically been significant, and it may now move voters who will cast their ballots before subsequent debates. Early voting is reflective of the intensity of the campaigns, and debates tend to auger fervor in the bases of the respective camps. Early voting is also a test of each campaign’s ability to utilize all advantages of the various state rules and to employ tactics that reach and motivate early voters. A strong message by Gov. Romney in the first debate, to swing voters dissatisfied with President Obama’s record on the economy but not yet sold on him as the way back to prosperity, would go a long way to providing the incentive to early voters in key states to mark their ballot for him.
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CAPITOL REPORT
27 SEPTEMBER 2012
REGIONSBUSINESS.COM
PENNSYLVANIA TURNPIKE
Auditor General Wagner: PA Turnpike Toll Increase Driving Away Motorists HARRISBURG — Auditor General Jack Wagner on Tuesday accused the Pennsylvania Turnpike Commission of using “flim-flam financing” to pay off its $7 billion debt. But Roger Nutt, CEO of the commission, said its finances are sound — as long as it increases tolls for the next decade and beyond. And if the motorists don’t pay, Mr. Wagner said, “that debt is guaranteed to be paid … by the taxpayers of Pennsylvania.” Mr. Wagner told a joint hearing of the House and Senate transportation committees that the turnpike’s unsustainable debt, which is spiraling out of control, will drive up tolls and eventually drive motorists away from the turnpike completely. Mr. Nutt argued that the tipping point — when increased toll revenue is canceled out by drivers diverting to other roads — will never occur, referring to the turnpike’s own forecasts that consider gas prices and the additional travel time
of diverting to other roads. But Mr. Wagner said that tipping point will arrive sooner than later as the turnpike is on pace to be the nation’s most expensive toll road, when its next toll increase takes effect in January 2013. The commission is crippled with this debt because of Act 44, which Mr. Wagner wants to repeal. The 2007 law allowed the turnpike to take on more debt in exchange for providing the state with $450 million annually. To meet that obligation, the turnpike increased its debt by more than 181 percent since 2007 and has raised tolls for the past five consecutive years.
LEGISLATIVE UPDATE
Each week, Region’s Business will highlight some bills introduced to the state House and Senate. HB 273 “authorizes all public school districts in this Commonwealth to establish senior volunteer programs that allow older residents to volunteer in the schools.” In exchange, seniors would receive a tax reduction as an incentive. HB 272 Primarily sponsored by Representative Dick Hess, R-78th Dist., this bill creates a task force for Lyme disease and related illnesses. Pennsylvania is ranked among the top three states in the nation with the number of reported cases of Lyme disease. HB 89 This bill requires Philadelphia to appropriate certain funds to the police and firemen’s pension funds and “prove credit for military service. Not only that,
it would also require reports and audits of the action as well. HB 2313 Serving to amend the previously introduced act known as the Pennsylvania Election Code, this bill would repeal certain provisions related to the enforcement of voter identification requirements for voting. In preparation for the upcoming election, it discusses those who are qualified to vote, the process of absentee ballots, and the process for delivering and mailing ballots.
27 SEPTEMBER 2012
CITY POLITICIS
REGIONSBUSINESS.COM
19
CITY COUNCIL MATTERS
MADE IN AMERICA
Council Continues to Phase Out Business ‘Privilege’ Language
Mayor: Festival Had $10M of Economic Impact
Timothy Holwick is a freelance writer covering Philadelphia government. Find more coverage at citycouncilmatters. com and follow him on Twitter @ CityCouncilBlog.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness. com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
City Council introduced a bill last week to continue the efforts to phase out the “business privilege” terminology which has since been renamed. Philadelphia has long required a privilege license for businesses to operate within city limits. The city has required a business privilege tax, which was applied to business income earned. Beginning with a bill proposed and passed in 2011, this new bill continues to eliminate old terminology from the city’s revenue provisions. The new terminology is “Commercial Activity License,” and the new tax terminology is “Business Income and Receipts Tax.” The change is a technical one requested by the city’s administration. Each week, Mayor Michael A. Nutter sends correspondence to City Council that includes some commentary and requests for certain legislation. In those cases, Council President Darrell Clarke performs the formality of introducing the bill on the administration’s behalf. The formality of the process is compounded by President Clarke’s inability to propose bills (Councilman Curtis Jones, Jr., proposes them on his behalf ). If this sounds like a lot of trouble to make a technical change to the city revenue code, it is. However, tax issues are at the forefront of both the mayor’s and City Council’s agendas. Legislative language must be cleaned up before upcoming changes go into effect. In 2011, City Council and the administration worked on a bill to discontinue use of the phrase “business privilege” as both a reference to the license and tax. The reality had become apparent: Philadelphia was struggling to draw in or maintain businesses. Those businesses, who were either choosing other cities or moving outside of Philadelphia’s city limits, were also taking jobs and revenue out of Philadelphia’s economy. When a city is considering begging businesses to
The Comcast Center stands at 17th Street and John F. Kennedy Boulevard. (J. HOLDER FOR GPTMC)
operate within its borders, how could that operation ever be considered a privilege by the business? In 2014, the Commercial Activity License and its accompanying fees will no longer be required in Philadelphia. Thanks to the Jump Start Philly program, new businesses in Philadelphia may qualify for exemptions from the Business Income and Receipts Tax during the first five years of operation. Philadelphia is making it clear that it is the privilege of the city to host a new business, not the other way around.
VOTER ID
DEVELOPMENT
City Won’t Distribute IDs in Homes, Colleges
City, Developer Settle On Point Breeze Battle
Montgomery and Allegheny counties announced that they will use a loophole in the new Voter ID law in order to distribute cards at nursing homes and colleges, but Philadelphia announced it will not follow suit. The Pennsylvania Department of State told CBS that it believes that the counties’ distribution plans violate the spirit of the controversial Voter ID legislation.
The developer who cleaned up about 40 tons of trash from his neighboring, city-owned lot in Point Breeze does not yet need to return it to the condition he found it, the city announced last week. Philadelphia is trying to sell the lot on the 1100 block of South 20th Street, according to Philly.com. It is not yet clear whether the developer will have to return the trash after the sale of the lot.
The Budweiser Made in America Festival had an economic impact of more than $10 million for Philadelphia, according to Mayor Michael A. Nutter. Live Nation, which sponsored the Labor Day weekend event, footed the entire bill and helped generate hundreds of thousands of dollars in tax revenues for the city’s financial reserves, according to the mayor. “Financial considerations aside, this event gained global recognition for Philadelphia and showed what a great city can do working with the private sector,” he said in a statement. “It energized our hospitality industry on a traditionally quiet weekend, brought thousands of visitors to our city and pumped millions of dollars into the city’s economy.” Meryl Levitz, president and CEO of the Greater Philadelphia Tourism Marketing Corp. also touted the festival’s success. “Equally exciting was the international media coverage: we have tracked well over 6,000 pickups so far including print, online and electronic,” Ms. Levitz said. Ed Grose, executive director of the Greater Philadelphia Hotel Association, said in the statement that his member hoteliers were “thrilled with the weekend.” Email political news tips to Emily DiCicco at edicicco@regionsbusiness.com
ELECTION 2012
Clinton to Campaign for Kane at Warwick Hotel
(POLITICSPA.COM)
Former President Bill Clinton will be the keynote speaker at a rally for attorney general candidate Kathleen Kane from 6 to 8 p.m. October 1 at the Warwick Hotel in Philadelphia, according to PoliticsPA.com. President Clinton’s endorsement helped Ms. Kane defeat Patrick Murphy in the primary race earlier this year. She now faces Republican Cumberland County District Attorney Dave Freed.
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CASE STUDY It’s a boom time for
Pennsylvania wineries, only now really reaping the benefits of a law enacted more than 40 years ago. Once considered a novelty, these wines, combined with some creative marketing, have evolved into a highlight of the region’s economy.
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JUDY CURLEE
ignated for wine making. Grapes are a commodity that Pennsylvania produces throughout its 67 count may seem like an overnight success story. ties. Far from it, but Pennsylvania’s wine industry While the counties of southeastern Pennsylvania is now a major player in the state’s economy, may not have the cachet of some international wineespecially here in southeastern Pennsylvania. growing regions, that is changing. According Chien, After Prohibition, the state’s established the region has the soil, the climate, the tradition, the wine industry in our region that began with plantings entrepreneurs, and the beauty of both the Brandywine by William Penn in 1684 stalled. But Limited Farm and Delaware River valleys to build a strong wine proWinery Act of 1968 changed the landscape – literally duction and tourism business. He advises existing and figuratively and now, 42 years after the legisla- and start-up commercial wine vineyards, which are tion allowing commercial vineyards and wineries, the proliferating. There are now more than 170 bonded wineries throughout the state of Pennsylvania. From state has over 170 bonded wineries. Of these, the southeastern quadrant is the fastest 2003, that marks an increase from 84 active licensed growing wine region, according to a monograph wineries, doubling in less than a decade. Chien’s employer, land grant Penn State University authored by Mark L. Chien, Viticulture Educator at recognizes the role of wine as a commodity, but does Penn State’s College of Agricultural Sciences. not designate a great deal of money toward support, only $100,000 as of 2011. Supplemented by an addiA Bustling, Diverse Business tional $150,000 from a $0.15 surcharge per gallon Let’s narrow the focus to the Philadelphia region, of all wine produced in Pennsylvania for that alland check the positive impact of this growing indus- important marketing, these funds are administered try. Working within the three-tier system of the by the Marketing and Research Board. This compels the small, family owned and operated Pennsylvania Liquor Control Board, the indifference to local product, and an economic recession, entre- wineries to get creative. They have formed collaborations, such as the Wine preneurial vintners in Chester and Bucks counties are making a profit, paying taxes, hiring employees, Trail of Chester County and the Wine Trail of Bucks County, two highly successful enterprises that benefit serving communities, and pleasing customers. Those families able and willing to risk change, member and raise the profile of regional; wineries invest capital, rethink market strategy, and in one and vineyards. Another joint effort is the Bucks County Winercase, implement a sizeable wholesale distribution system, add to the bottom line, of the respective cor- ies, a shared marketing shop set up by Rose Bank Winery Crossing Vineyards and Winery, and Sand porations and region alike. The 2009 economic impact report, commissioned Castle Winery on Main Street in New Hope. Visitors by the Pennsylvania Wine Association (PWA), found to Peddlers Village can purchase Chaddsford Wine at its retail outlet, which also offers encouraging numbers, maybe even events planning and wine and food amazing numbers. And the report pairings. Crossing Vineyards and shows there is a multiplier effect. For every $1 in wine sales, there is conserva- THIS IS AN EXCITING Winery has a storefront in Manatively $2.35 in related spending. yunk, as well as a retail outlet at the TIME TO BE According to Jennifer Eckinger Mohegan Casino up in Wilkes-Barre. Director of the Pennsylvania PWA, INVOLVED IN THE Vineyard or winery, or both, the southeast in particular does well GROWTH AND our regional wine enterprises sigbecause of the population. Vineyards ESTABLISHMENT OF nificantly impact economic activare planting more classic vinifera vari- A SERIOUS WINE ity. The financial statements of the businesses, which are privately held, eties to draw sophisticated consumers. INDUSTRY ...’ are of course unavailable. However, Also, the creativity of the wineries and interviews with proprietors and winvineyards is noteworthy. Events are —MARK L. CHIEN becoming more family-friendly. And ery visits during a recent Saturday the wine trails are perhaps the best tool, afternoon suggest that a big chunk of as they get the idea out there that the producers exist, that $2.35 billion state-wide benefits the Philadelphia that this is entertainment beyond what comes from region. a bottle of wine. Pennsylvania wine is an experience, The wine palate is changing, and savvy busia true agribusiness, leading to the PWA logo embla- ness owners are positioning themselves to benefit. Increasingly, wine is being chosen as a cocktail and zoned with “Savor the Experience.” “This is an exciting time to be involved in the younger drinkers are choosing wine instead of spirgrowth and establishment of a serious wine industry its. It has a known alcohol and caloric value, which and region in Pennsylvania,” says Chien. appeals to the health-minded of every socioeconomic Late September is peak harvest time for grape group. Further, strict enforcement of drunken driving growers and wine tourism activity across the region. laws make it imperative that social drinkers modulate As of 2003, the commonwealth ranked fourth nation- their intake of any alcoholic drink. And knowing the wide in grape production and seventh for grapes des- alcohol content of a three ounce glass of wine makes
I
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Side Businesses Help Bottom Line Each of the six wineries randomly sampled in the Philadelphia region represents a unique marketing niche that benefits its owners, and by extension, increases the economic impact of the wine industry here. These business owners have identified proven marketing strategies to gain customers. Festivals, wine shops, wine trails, wine tastings, the special events ranging from intimate to lavish, competitions, all increase the revenue from wine sales alone. There is no limit to the ideas generated by the growers to make use of their properties and their good will, and increase profitability. Clearly, these wineries are profitable, healthy, privately held businesses that have not only weathered the recession of 2008, but have increased and expanded operations, moving nimbly beyond winemaking in many instances to real tourism. Most noteworthy is the variety among the side businesses found at the wineries in our area. Much ingenuity in every case provides an enjoyable experience for everyone, while pouring millions into the region’s economy. Sand Castle Winery A European style castle, with opportunities for celebrating special occasions, the winery schedules grape crushing tours for guests during harvest. In addition to a tasting room and guided tours, it includes the Upper Gallery, a formal setting for tasting and museum quality blown glass from the Czech Republic and Slovakia, available for purchase. Buckingham Valley Vineyards An opportunity to see how capitalism works on a local level, this vineyard charges nothing for tasting, and permits picnicking. This approach encourages purchases and return business. Staying within the state’s boundaries, growing and selling all its wine, the company reinvests and is highly profitable. This enterprise is a do-it-yourself that sticks to the basics of wine growing and wine making. Rose Bank Winery Just over an acre of seventeenth-century history in an upscale Bucks County suburb of Newtown, this historic cluster
of buildings that had been a gift from William Penn to one of his daughters gives the visitor a chance to taste wine in an informal, friendly space, or host a large event at a newly refurbished elegant barn, complete with a staircase from which a bride or any honored guest can descend to a spacious catering hall. Crossing Vineyards and Winery A community center, hosting cultural, social, and wine-tasting events, this gorgeous winery builds on the winemaking with a range of catering events and tours. Its owners arrange international tours to educate the wine lover. Weddings, concerts, bar mitzvahs and elegant dinner parties take place daily on this historic property with its lovingly landscaped grounds. Year-round, the vineyards welcome guests from around the region and the world. It is a major destination, and draws visitors off of Interstate 95 with PennDOT signage. Chaddsford Winery Another of the pastoral settings in southeastern Pennsylvania that has been updated to handle events for all ages, live music, and seasonal gatherings, such as
the upcoming Zombie Ball, and leisurely afternoons for the wine enthusiast, Chaddsford Winery is a romantic spot for many couples. This winery also does a great job educating younger drinkers with a self-directed tour. Paradocx Winery Nearby in Chester County, this winery reaches out to families with its Corn Maze, and a corncob launching. Its beautiful setting, easygoing ambience and dedication to quality wine bring families back. Owned and run by two families, two couples all of whom are physicians and thus scientists attuned to the chemistry of wine-making, Paradocx is a great place to sample wine and unwind on a fall afternoon. Clearly, the overall goal has been to offer something for every budget, every age, and every palate among these and the other regional wineries. Jennifer Eckinger, Executive Director of the Pennsylvania Wine Association notes that the growth of the industry has expanded options. “You are never more than a half an hour away from a memorable experience,” she said.
Recent expansiona and renovations have allowed Rose Bank Winery (top) to offer a wide variety of events. Wine tours have become popular among the region’s vineyards, including New Hope Winery (above). PHOTOS COURTESTY OF ROSE BANK WINERY (TOP) & ANTHONY SINAGOGA PHOTOGRAPHY (ABOVE)
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it manageable for consumers, unlike a mixed drink. To learn about wine, consumers are conducting hands on research, visiting wineries, purchasing Pennsylvania wines and attending the countless tastings offered by the region’s vintners, all of whom have websites in addition to roadside signage. To keep it simple, there are two types of Pennsylvania wine: wine that is made with Pennsylvania grapes that can be called, according to federal law, Pennsylvania wine. It can be labeled and marketed as such. Other producers who may not have sufficient grapes source grapes from Oregon, New York, California and other states, but then must designate their output accordingly. The transparency and ethical standards within the wine industry stem from the pride of the producers. One simple way of looking at the wine industry: there are city and country wines. The city wines use the vinifera grapes for estate and European-type wines that suit some tastes. Sweeter, country-style wine, use the local grapes, such as the Concord grapes. The vineyards have cultivated varieties according to preference and market strategy. Philadelphia’s regional wine producers are terrific business owners. A look at six operations in southeastern Pennsylvania wineries gives one a sense of their vision, passion and work ethic. These case studies demonstrate the economic impact of this group, from which one can extrapolate the benefits, augmenting the hard numbers supplied by the trade group-sponsored economic impact report dated 2009.
Family Affairs What follows is a snapshot of how the wine industry, both production and tourism, generates economic activity for the Philadelphia region. Owner operators of these family owned businesses do not talk about their financial circumstances, but they are economic engines for Bucks and Chester counties. And they really are pulling together to raise the profile of the region’s wine business. Visiting the six wineries and vineyards, four from the Bucks County Wine
THE NUMBER ONE IMPACT OF OUR BUSINESS IS EMPLOYMENT.’ —JOE MAXIAN SAND CASTLE WINDERY
PHOTO COURTESTY OF VISIT BUCKS COUNTY
Trail and two from the Chester County Wine Trail, show the owners’ love and labor. Ranging in size from 1.1 acres to 77 acres, on gently graded fields or rugged hillsides, each winery attests to free enterprise, hard work and the good life. Sand Castle Winery has a festival feel, given by its owner, Joe Maxian, who says, “The number one impact of our business is employment. We hire many people here. Secondly, we bring out-of-town guests who spend tourist dollars.” One of Maxian’s employees David Lockhardt guided a large crowd starting with the grape crushing machine, nicknamed Lucy, then through a cavernous subterranean cellar. As with all the operations, the production areas were whistle clean, upholding the vision Maxian shares with his brother Paul, natives of Bratislava, Czechoslovakia.
North of Erwinna, planting vines high on the banks of the Delaware River, the two men built a great castle and winery. This bucolic expanse accommodates large crowds. Its most recent amenity, opened in 2010, the Upstairs Gallery offers premium tastings in an elegant setting. The facility ran with friendly efficiency, as guests were directed to sample the sweeter wines gratis or to participate in an affordable tasting of the special estate wines. Buckingham Valley Vineyards is a serene place with 45 acres. Truly Mom and Pop, its co-founders Jerry and Kathy Forest, employ four families, his own, those of his two sons, and another family who work the 45-acre vineyards. The Forests do not source any of their wine. From hard work, seven days a week, 12 hours a day, they make good
wine and a great living. Jerry’s Wharton B.A. in Economics has come in handy, as his family has become one of the most profitable wineries in the state, continually reinvesting in the business. Everything is done in-house, from accounting to production, so his success benefits many. As with his fellow growers, he works every day of the week. This vineyard benefits from accessibility and markets in a more low-key manner. The emphasis is on the work; Kathy and Jerry walk to work down the staircase to the shop. Rose Bank Winery allows its owner Dave Fleming Sr. to preserve an original Penn’s grant property in Newtown Township. He runs a great operation on 1.1 acres, using grapes that he grows as well as some he purchases. He has extensively repaired and expanded the buildings
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Impact a Matter of Simple Math Jennifer Eckinger, Executive Director of the Pennsylvania Wine Association (PWA), offers some simple math. “Across the state, agriculture is number one. Tourism is number two. Add them together and get the wine industry’s economic impact. The wine business is an agribusiness, a unique combination of a commodity and commercialism benefiting the Philadelphia region.” Statewide the annual impact is $2.35 billion according to the 2009 MKF market research study commissioned by PWA. Of that total amount, a substantial portion circulates throughout southeastern Pa. Updated market research numbers will be available upon the completion of the current study, available in early 2013 and available then on the association’s website. Eckinger supplies another impressive bit of math. From 2003, Pennsylvania’s active, licensed wineries have doubled in number from 84 to over 170 wineries statewide, dozens of them in the southeast. She reports how other aspects of the wine industry have more than doubled rapidly. “Between 2000 and 2010, the number of total gallons of wine produced in Pennsylvania has increased from 559,636.90 gallons to 1,811,458 gallons. During that time, the total number of gallons statewide increased during that decade from 462,781.90 gallons to 1,100,025 in 2010.” There is no way to break down the volume of wine produced and sold per winery in the southeastern region, as the wineries are privately held. Still, our region’s wine producers contribute significantly to the growing success of the industry. By the numbers, their combined economic impact is growing.
September is harvest time at Crossing Vineyard in Washington Crossing, Bucks County.
PHOTO COURTESY OF VISIT BUCKS COUNTY
Wineries Boost Bucks Tourism Bucks County may not be the Napa Valley, but the wine industry has proven to be a significant boost to the tourism industry here. Jerry Lepping, Executive Director of Visit Bucks County, the official tourism promotion agency for the county, said his agency has been working with the the Bucks County Wine Trail for the past four years. That includes marketing to the New York metro market on public transportation and Broadway showbills as well as $100,000 grants through a suborganization, money the wineries use for other marketing activities. Additionally, VisitBucksCounty.com includes a feature on the Wine Trail, including an interactive map with information about the wineries. [You can find that under “Itineraries”]. Mr. Lepping said that the growth of the wineries has been a plus for tourism in the county. “It’s like someone dropped another Sesame Place in Bucks County,” he said referring to the county’s biggest tourist attraction. The Wine Trail is “a big draw.” The reason for success is simple, he said. “It’s more than snob appeal, it’s more than fancy wine,” he said. “It’s the whole experience. If a visitor finds a nice wine that they like, it’s a
big bonus. The wineries understand it’s about the experience and they do a great job with that.” While nearby Chester County is also experiencing success with its wineries and also boasts a similar setting, Bucks County has that all important business advantage - location, location, location. “People come down here from New York City and they love the area,” he said. “They love to see rolling hills instead of rolling sidewalks.” “Bucks and Chester have a lot of similarities, but we have the advantage of being a lot closer to New York City.” That proximity makes a weekend getaway just a bit easier. Visitors tend to stay the weekend, too, Mr. Lepping said, adding that some bed and breakfasts understand the attraction of the wineries and have established partnerships. The Bridgeton House, for example, partners with the nearby Sand Castle Winery and a local florist for a Wine & Roses Weekend. “Some of the wineries are very small, so that a tasting is like being invited to someone’s house, which some people like,” Lepping said. “Others are bigger and have a different appeal.” - Region’s Business Staff
IN SEASON Fall means Bucks County wineries are offering up seasonal wines, including: Crossing Vineyards & Winery’s Spiced Apple wine with a taste of hot apple pie mixed in with hints of honey and butterscotch. Sand Castle Winery’s Alpine Spice with a blend of herbs and spices that pairs well with the smoked meats and cheeses. Rose Bank Winery serves up apple pie in a bottle with their award-winning Mulled Apple fruit wine. In months that end in an “R,” Peace Valley Winery offers Spice Wine, a hearty red wine with a stimulating blend of spices.
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on the winery’s property, of this living museum. employee for every 1,500 so he can not only hold Everyday maintenance gallons of wine produced. events such as wedding is taking place to keep That is economic impact. party gatherings, but the grounds pristine, One refrain offered ACROSS THE also more family-friendly including twelve buildby PWA’s Director Eckones, including bar/bat STATE, ings and the vineyards inger, Viticulture Educamitzvahs, anniversaries AGRICULTURE IS themselves healthy. tor Chien, Tom Carroll, and christenings. Participating in interand all the regional wine NUMBER ONE. As with all these vint- TOURISM IS producers of Bucks and national wine compeChester counties: Buy the ners, Dave’s enthusiasm is titions and directing NUMBER TWO. wines of Pennsylvania, palpable, as he provided international wine visit its wineries, and ask a private tour of the fer- ADD THEM tours have allowed for regional wines when Tom and Christine mentation equipment. TOGETHER AND dining out. Taste what to market and eduMeanwhile, the parking GET THE WINE this unique pairing of lot was full, including a INDUSTRY’S cate their customers.. agriculture and business limousine for a bachelorThey have led groups ECONOMIC produces. Increase the of wine enthusiasts ette party. The cash regprofits and keep the dolto Europe and New ister rang, the sun shone, IMPACT.’ Zealand, and are now and the vineyard with —JENNIFER ECKINGER lars in the state. in France, leading an the old farmhouse held Finally, any discussion Alsatian wine tour. All suburbia at bay. Like his of potential economic fellow winemakers, Dave keeps it in the these tours require the work of a impact on the part of family, selling some of his wine at the Washington Crossing travel agency, the wine industry must producing yet another economic family farm, Shady Brook. acknowledge the PennDown the road, yet another family benefit from these regional wine sylvania’s restrictive laws runs a successful wine business. Cross- ambassadors. governing the sale of Chaddsford Winery is unique wine. Currently changes ing Vineyards and Winery excels at the are being debated in Harcreative hospitality that makes it a favor- in yet another way. Founded by ite setting for Buck’s County brides. Here another pair of visionaries, Eric risburg that would move the Carroll family, Tom, Christine, and and Lee Miller, it will continue as North of Erwinna, in Bucks County, Joe and Paul Maxian planted their vines toward privatizing the Tom Jr. are living the dream envisioned a regional winery. whole wine and spirits high above the banks of the Delaware River. In addition, it is stepping up to PHOTO COURTESY OF VISIT BUCKS COUNTY by the younger son to turn their lovely industry, dismantling now Bucks County property into a top-rate wholesale distribution of four core regulated by the powerwines. Wine pioneer Miller will low single digits as a percentage of the vineyard and winery. ful Pennsylvania Liquor Tom’s New York banking experience stay on as a wine consultant, with his overall business. Control Board. The 1968 Limited Farm To show how supportive the region’s Winery Act restricts the number of contributes to his success, as does his 40 years expertise. Now that the Millpassion for winemaking. The winery’s ers have divested their extensive hold- vintners are, Chaddsford’s Kuhn sug- places that a vineyard can sell its wine to charming grounds and stone structures ings, the beautiful five-acre winery in gests a stop at Paradocx. Paradocx five and the total annual production to can accommodate corporate gatherings, the Brandywine Valley will continue to Winery has its own niche, making its 200,000 gallons. While that legislation weddings, wine tasting, and tours. Own- be a destination under the experienced own contribution to the region. Its loyal did much to fuel the growth of wineries customer base purchases its vintages, and increase the economic importance ers Tom and Christine Carroll and their management of Greg Kuhn. At the same time, Carl Perillo, who and many weekend wine enthusiasts of the wine industry, the industry could son Tom Jr. operate the place, handling more than 600 events annually on 20 worked closely with the Millers for visit. Like all these places, the owners clearly benefit from easing of some of acres. Crossing Vineyards represents many years, will take the wine sales are smart, skilled, and hard working. Its the nation’s most restrictive and at times one of the most ingenious businesses, wholesale. Perillo has hired General whimsical name comes from the fact that irrational laws. A wine retail shop can adding much to the bottom line for the Manager Bob Brock, who in turn has set the two married couples who founded sell a cheese board, but not a cheese region. In its 12 years it has grown into up a three-person sales team headed by the winery are physicians; all four princi- knife. Go figure. The southeastern Pennsylvania winera community center of cultural events. Joe Spurlock to work the eastern part pals are doctors. This is a family-friendly His operation employs more than 50 of the United States and beyond. This winery for all in a bucolic setting. ies will continue thriving in spite of what fulltime employees, with 12 buildings to wholesale distribution system will be happens legislatively. They are better maintain, in addition to the 140-year-old getting the core four wines, Niagara, than ever, and that is great news for the Bottom line: Sangri-La Sangria, Sunset Blush, and tasting room. region’s business. Economic Impact That is a lot of economic activity, help- Spiced Apple Wine, in retail stores and Freelance writer Judy Curlee lives on ing groundskeepers, florists, chefs, food restaurants from Maine to Florida, so the For job creation, the wine industry is servers, and custodians on the payroll out-of- state sales will increase from the a clear winner, producing one full-time the Delaware River in Bucks County.
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27 SEPTEMBER 2012
REGIONSBUSINESS.COM
IDEAS
Key Question: More SEO or More Social Media Marketing?
Lance Bachmann is founder and President of 1SEO.com, a company involved in search engine optimization (SEO), pay per click (PPC), social media optimization (SMO), mobile search, as well as web design and development.
HOW TO SHARE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
It is important that businesses take the time and necessary resources to invest in their social media marketing because that is where many people are spending a majority of their time these days — on social networks. Facebook alone has shown the world that more people are using social media networks to interact and spread news between one another than ever before. Also, with a whopping 955 million active user rate as of June 2012, the potential for a business spreading its products or services by “word-of-mouth” is phenomenal. But how can a business take advantage of the virality of the social networks? They can, but what about old-fashioned Internet Marketing, and better yet — SEO (search engine optimization)? Website search engine optimization is no doubt the most important part of any Internet marketing strategy. And where it is merely important that a company be involved in social media these days, it is imperative that they be involved in SEO. Search engines are perhaps the biggest component to the Internet space because the first thing a person often does when he or she switches on their computer usually includes the word “Google.” But what are more people leaning towards when it comes to the Internet? Are they more prone to jump on their favorite social network, or search on Google? It is true that social media has evolved over the past few years, but when it all comes down to it, it is just another thing to add to the online marketing mix. Yes, it is important that a company have a social media presence, but the need for traditional Internet marketing will never fade. However Google’s updates, Panda and Penguin, which crack down on websites that use black-hat SEO techniques of keyword stuffing, cloaking and/or link schemes, have paved the way for encouraging a better and stronger social media presence for businesses. The best way to avoid being a static web-
site, and thus being targeted by Panda and Penguin, is to update content and keep a blog on the website. A company can use a blog to engage with its target market, providing value in that the blog will provide advice, tips, etc. If successful, not only will the company get a boost in search engine rankings on Google for creating fresh content, it will have the potential to build loyalty in its target market and encourage users to share (thus making them more social.) Consistently publishing new content is important whether it be for SEO or social media marketing. It should be a no-brainer that simply creating content is not enough, a company has to share it and follow-up. A company’s target audience will also need an emotional attachment and relationship with the brand in order for it to thrive on social media. So, now that Google has essentially forced websites to produce better content and
keep businesses talking, why shouldn’t they share that content on a social media site and attempt to engage with the target audience, or many others amongst the millions on a social media network to form a relationship? In order to gain those followers, likes, and friends, a company needs to share content across the social web. Social media marketing has evolved, but traditional Internet marketing is not going anywhere soon, especially when it comes to obtaining a high ROI. It appears as if the SEO vs. SMO battle has come to a halt with both sides coming to an unexpected compromise. The compromise being this: Google forcing more and better content out of businesses equals a greater potential for better content to published and talked about on social media sites. Have something to say? Write it, post it, share it, and then watch it go viral all while seeing your website’s rankings increase. Why not? That is the question.
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27 SEPTEMBER 2012
REGIONSBUSINESS.COM
FINE ESTATES
Manor Home Built in 1929 Rests on More Than 40 Acres
This lot includes a total of four parcels: L1 Northwestern Avenue, 11.94 acres; L12 Northwestern Avenue, 2.79 acres; 9303 Ridge Pike, 25.45 acres; and L9 Manor Road (Whitemarsh Township) 2.52 acres.
This $9.9 million home boasts features ceilings of nine feet or more, an elevator, exposed beams, a bay window, five bedrooms, three full bath, one half bath and a detached, threecar garage. The wooded lot takes up more than 1.1 million square feet.
Designed in 1928 by Sydney Errington Martin of the renowned firm Thomas, Martin & Kirkpatrick and built in 1929, this magnificent manor home is truly a one-of-a-kind property. Reminiscent of the expansive manses of European society, this nearly 9,000-square-foot residence with six fireplaces is sited in an idyllic setting amidst 40-plus scenic acres opposite Fairmount Park, within easy access of Ace Course and not far from Whitemarsh Valley. Offered by Art Herling, Long & Foster Real Estate - 215.654.5950, for $9.9 million.
WRIGHTSTOWN TOWNSHIP Custom home on 2.6 acres ~ Over 5,000 square feet of luxury living space ~ Amazing finished lower level ~ 3 car attached and 5 car detached garages~ $725,000
UPPER MAKEFIELD TOWNSHIP Exceptional 5 yr young custom home with superb details & amenities ~ 5 bedrooms & 5.1 baths ~ Custom cabinetry and tile work, arched entries, Lyptus hardwoods, lavish master suite, finished walkout basement & more ~ $1,500,000
WARWICK TOWNSHIP Car enthusiasts and hobbyists must see! Two homes and outbuildings for the price of one! Historic stone home plus Carriage/Tenant house ~ Beautiful Bank Barn ~ Corn Crib ~ 2.11 acres ~ $539,900
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NEW CUSTOM CONSTRUCTION UPPER MAKEFIELD TOWNSHIP, PA 29 beautiful home sites (10 magnificent lots still to choose from) 1-2.5 acres Just 3 miles from I95 Pisani Builders Associates, Inc.
DOYLESTOWN TOWNSHIP New custom construction by Michael J Sullivan, Inc. ~ PERMITS ISSUED ~ BUILDING HAS BEGUN 1.25 acre lot ~ 3,400 square feett ~ 3 1/2 bath ~ 3 car garage. Quality amenities included ~ $599,000
Building packages starting from $1,200,000. Off-site locations also available.
DOYLESTOWN AREA Design your new home today with Lykon Custom Builders on 1.74 acre estate lot next to preserved land & open space ~ Central Bucks Schools ~ Personal attention from design to finish ~ Other lots available ~ from $649,990
EastSide,West Side,We’reAllAroundTheTown
East side condos: Pier 3, Pier 5, 22 Front, Society Hill Towers, The Bank Building,The Lippincott at Locust Walk,Independence Place, Hopkinson House, 220 W. Washington Square, Center City One.
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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Q&A
27 SEPTEMBER 2012
REGIONSBUSINESS.COM
DAN LIFSHUTZ’S
TECHNICAL
SUCCESS
For a startup in the increasingly competitive IT services sector, it helps to have a written business plan that shows financial goals and explains the type of culture you hope to create.
Having got its start during the Internet boom of the 1990s and continuing to thrive well beyond the threshold of the “Y2K” era, Arraya Solutions appears to have mastered the business model for IT consulting. We sat down with CEO and co-founder Dan J. Lifshutz for a chat about the Plymouth Meeting-based company’s success and how it plans to navigate the increasingly competitive market. What is the elevator pitch for Arraya Solutions? Arraya Solutions is a full-service IT consultancy, integrator and managed service provider. What did you initially aim to do differently to take advantage of the Internet boom? We were trying to take advantage of a low-cost alternative around solution delivery. We understood [at the time] that there was a need in the marketplace for engineering know-how, and it was being delivered at a price point that, for some customers, was high. Our model was that we could deliver the same level of expertise at a lesser price. What is the most important attribute to have as a start-up? I think the most important thing is a good business plan. It needs to be in writing, and it needs to not only focus on the financial aspects of the endeavor, but also the kind of culture you’re looking to create. And the kinds of relationships you intend to build with your customers. I think it’s also important — you have to persevere, you have to stick to it. Early on, it’s not always going to be easy. If you believe in the plan, you’ve got to stick to it.
Your company description speaks to the idea of getting to know the companies you work with. How do you do that with so many of them? The discovery process requires listening skills. We hear from a customer not only what their technical requirements are, but what their business strategies are. Ultimately, we’re going to put together the right technical solution, but if it doesn’t align with their financial objectives and doesn’t satisfy their user community, they’re not going to see the return on the investment that they need to justify spending the money. What has been the biggest hurdle for Arraya? The biggest hurdle, which is two-fold, is that we’re susceptible to the macro economy, and also how our customers are feeling in terms of the financial climate. Our marketplace has evolved, there’s more competition than when we started. As well, the model is going more toward that of a service industry rather than a product industry. Is that competition regional? Yeah, we definitely see more regional competition — more than we’ve ever had. I think there’s also still a strong national presence from a competition standpoint, too. Where do you see the company in five years? The company will continue to evolve into a managed services provider… it will become a bigger part of our revenue streams. We’re also expecting tremendous growth within our application development practice, and a lot of that’s driven by the turn toward mobile devices.
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27 SEPTEMBER 2012
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CHAMBER REPORT
INTERNATIONAL VISITORS COUNCIL
PENNSYLVANIA CONFERENCE FOR WOMEN
GREATER PHILADELPHIA CHAMBER OF COMMERCE
Council Kicks Off Monthly First Thursday Discussion
Annual Conference for Women Attracts At Least 5,000 Attendees
NBC News’ Andrea Mitchell to Headline Annual Meeting
The International Visitors Council of Philadelphia will host its monthly First Thursday networking event October 4 from 5:30 to 7:30 p.m. at the Courtyard Marriot in Center City. Guests each receive colored ribbons that correspond to their interests to facilitate conversation. Registration is currently open and costs $15 for nonmembers in advance and $20 at the door.
The PA Conference for Women, in cooperation with the Greater Philadelphia Hispanic Chamber of Commerce and Public Strategies Inc., will present the 2012 Pennsylvania Conference for Women on October 2 at the Philadelphia Convention Center. The annual event began in 2004 and has become the largest event of its kind, attracting more than 5,000 attendees to the non-profit, non-partisan, one-day event geared toward the professional and personal lives of women. For $150 registration fee, guests will gain access to networking opportunities, more than 150 exhibitors and seminars from a diverse cast of speakers. Keynote speakers this year include president and editorin-chief of the Huffington Post Media Group, Arianna Huffington, as well as poet and activist Sonia Sanchez and weekly Good Morning America contributor Tory Johnson.
The Greater Philadelphia Chamber of Commerce announced that Andrea Mitchell — NBC News’ chief foreign affairs correspondent and host of “Andrea Mitchell Reports” — will be the featured speaker at the 212th Annual Meeting. More than 1,500 business professionals are expected to attend the October 24 meeting at the Pennsylvania Convention Center. The gathering will celebrate the Chamber’s accomplishments of the past year, including reaching a membership of 5,000 organizations across 11 counties in three states, and discuss goals for the coming year. The chamber will also welcome new members to the board of directors and recognize the outgoing Chairman of the Board, William Hankowsky of Liberty Property Trust.
WORLD TRADE CENTER OF GREATER PHILADELPHIA
October Program to Focus on Ancient Cities
The World Trade Center of Greater Philadelphia will facilitate a “Voyage into Antiquity” October 2-14 aimed at the exploration of the ancient cities of the Aegean and Mediterranean seas. Ambassador Mark Johnson will lead tours and lecture on the origins of the civilizations as well as the political issues that currently dominate the region.
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27 SEPTEMBER 2012
REGIONSBUSINESS.COM
OPINION
Pennsylvania’s Liquor Store Monopoly It’s time we take control away from special interests
Eric Boehm is the Harrisburg bureau chief for the Franklin Center for Government and Public Integrity.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
HARRISBURG – Government of the people, by the people and for the people has a nice ring to it. Unfortunately, when it comes to Pennsylvania’s state-owned-and-operated liquor store system, it’s more like government of, by and for the special interests. Polls consistently show more than twothirds of Pennsylvania residents favor privatizing the state liquor stores, but the special interests that control the state’s wine, liquor and beer markets happen to like the current system – and really, they are the ones who matter in Harrisburg. It was all on display earlier this year when House Majority Leader Mike Turzai – long a proponent of privatizing the liquor market – pushed a proposal to shutter the Pennsylvania Liquor Control Board’s 620 state stores and allow 1,600 private liquor sellers in the state. It was a renewal of a battle that Republican governors and lawmakers have been fighting for decades, a battle that some believed was destined to succeed this year as Republicans held wide majorities in both chambers of the General Assembly and had the support of Gov. Tom Corbett. Republicans, of course, like to play lip service to free markets and competition, the very antithesis of what the Liquor Control A poster from The Commonwealth Foundation website, FreeMyDrink.com Board stands for. Alas, it ended the same way as always. lawmakers an angry letter informing them of the threat The most visible opposition to any privatization effort of competition from restaurants, grocery stores and other is the United Food and Commercial Workers, a union retail markets if the bill passed. that represents about 3,000 of the employees in the state Never mind the fact that grocery stores – notably, Wegliquor stores. As Turzai’s bill was being batted about the man’s – are slowly eroding the beer distributors’ nicely Legislature in May and June, they became a daily fixture carved-out market by exploiting a loophole in state law in the state capital in their bright yellow T-shirts proclaim- and licensing parts of their stores as restaurants in order ing their opposition to the “Turzai Tax” – a restructuring to sell six-packs. The beer sellers also said some of their stores lacked of the state’s complex system of levies applied to alcohol. But they are hardly the only group to credit – or to air conditioning and adequate space for the additional inventory that would be available if the revamped liquor blame – for another failed privatization effort. Even as the union was ensuring little Democratic sup- system was put in place. In other words, where some might see an opportunity port for the privatization bill, another group – the state’s association of beer distributors – was equally effective at to expand their business and attract new customers, the beer distributors saw a threat to their small, carved-out pulling votes away from the Republican majority. Turzai’s plan would have let distributors sell six-packs protected niche in the Pennsylvania alcohol market. And so, the bill failed to even get a vote in the state of beer (currently forbidden) and would have let them be first in line to purchase one of the 1,600 new liquor House. Republicans promise to try again in the fall, but licenses. You would think they would only see dollar signs history suggests we’ll watch the same process unfold again. with an opportunity like that. Meanwhile, the special interests that run the state’s Instead, the beer distributors were afraid of actually liquor system can raise a glass to another victory over the having to compete for their share of the market. The distributors sent Turzai and other Republican people.
MORE ON THE PLCB “The PLCB has grown to be lazy, arrogant, and wasteful. The administrative costs of the retail operation are out of control; there are fewer stores and more employees than there were in 1999, for example. It is a patronage pit... Privatization will cure that.” LEWIS BRYSON, BLOGGER
“I have never [seen] the reason for the initial appointment for the CEO [of the PLCB]. I still don’t see the reason for the appointment of the CEO.” GOV. TOM CORBETT
“If you’re going to function like a private retailer, you might as well be one. It is time for the commonwealth to divest of its operations into the private sector. It no longer serves a legitimate public function.” SEN. PAT BROWN, R-LEHIGH
“If you look at the state of the liquor industry today, it’s large retailers that dominate the landscape, and they are not going to hire many, or any, new people. They are just going to reallocate the shelf space and reallocate the existing workforce.” WENDELL YOUNG IV, UNITED FOOD AND COMMERCIAL WORKERS LOCAL 1776
“I understand the philosophical argument about whether it is an appropriate function of government, but let’s be very clear, alcohol is basically a controlled substance and that means it is a public safety issue.” Blake said. “I don’t think that our system is broken, and I think it can be made better.” SEN. JOHN BLAKE, D-LACKAWANNA
27 SEPTEMBER 2012
REGIONSBUSINESS.COM
OPINION
37
Wine Industry Boom: State’s Homegrown Success Story
N
evermind the wine snobs. Nevermind the people who literally look down their nose at wine from Pennsylvania, who believe no grape grown outside of select regions of Europe are capable of producing a palatable glass of wine. Despite their harrumphing and chortling, despite the doubts, something has quietly taken root in Pennsylvania. The wine industry has grown into a significant player in the state’s economy. It’s no longer a novelty, no longer a curiosity. It’s a legitimate industry, creating jobs and establishing a strong and loyal following. This is no overnight sensation, however. The seeds were planted way back in 1968 with the implementation of the state’s Limited Farm Winery Act. Fast forward more than 40 years and Pennsylvania now boasts 170 bonded wineries, with the fastest growing areas located right here in the Delaware Valley, specifically Bucks and Chester counties. This represents a classic American success story. Would-be wineries could not simply flip a switch and create a product. They could not simply hang out a shingle and watch the money flow into their coffers. Instead, it took vision, persis-
tence and that hallmark of the Pennsylvania workforce — hard work — to carve out a niche. Italian and French wineries had hundreds of years of experience selecting the right grapes for the right climate and soil, not to mention the nuances of wine production. Our state’s wineries learned from their mistakes, continued to stay focused on learning and improving. While some still disdain Pennsylvania wines, they have found an enthusiastic and growing audience, in no small part because of continued ingenuity. Many of them market to a younger audience and have used event marketing — winery tours, hosting events and weddings — to increase awareness and set the cash registers singing. While this is all great news, there is the opportunity for even more. The state need only simplify and relax its arcane and restrictive laws to unshackle the state’s wineries and unleash a wave of positive economic momentum. If the state only allows broader distribution, it would open great opportunities to this vital industry. Pennsylvania’s wine industry has proven itself resourceful and resilient. It doesn’t need to be propped up, it merely needs to be set free. Harrisburg, it’s your move.
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.
Maher’s Experience an Asset in Auditor General Election State Rep. John Maher, who as a legislator bucked political insiders by pushing for a rewrite of the state’s open records law, says he would use his accounting skills to install systems that would prevent questionable spending before it occurs, rather than revealing it later through performance audits. His auditing background gives Maher the edge. With Maher, voters can be assured of having an auditor general who needs no on-the-job training. EDITORIAL , 26 SEPTEMBER
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
THE PHILADELPHIA INQUIRER
Outside Groups Have No Business in Pennsylvania Politics It is bad enough when the mudslinging comes from within our state borders, worse when groups outside the commonwealth, who
@cherrybina PA is usually a swing state, but it’s looking solidly blue this time around. 26 SEPTEMBER 2012
clearly know nothing about the candidates, get involved. ...We are not naive enough to believe negative campaigning and mudslinging will end anytime soon. We do believe, however, that outside groups have no place spending hundreds of thousands of dollars to try to sway a Pennsylvania election — even if what they do is now legal.
electoral college system, which give so much more power to whatever states are swing states. ... If you’re the sort of person who hates seeing wall-to-wall political ads, this is great. But if you enjoy PA being the center of the political universe, it’s not so great. STEPHEN SILVER, 26 SEPTEMBER PHILADELPHIA MAGAZINE
EDITORIAL , 26 SEPTEMBER THE PATRIOT-NEWS
Does PA Still Share Your Matter in National Politics? Comments Here It’s starting to look like Pennsylvania no longer occupies the hallowed place in national politics that it once did. Part of it is demographic shifts that have made the state more Democratic. Part of it is the vagaries of the
Region’s Business welcomes comments, letters and essays. Send them to feedback@regionsbusiness. com. You can also reach Editorial Director Karl Smith at 610.940.1656.
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REGIONSBUSINESS.COM
BY THE NUMBERS
11%
Percentage of PIN numbers that are 1-2-3-4.
3.7%
60.1%
National hotel occupancy rate in 2011.
71.8%
Center City hotel occupancy rate in 2011.
90%
Center City hotel occupancy during Made in America Festival.
Percentage of Pennsylvanians who approve of Gov. Tom Corbett’s performance, according to a poll released recently by The Morning Call and Muhlenberg College.
46%
Percentage of Pennsylvanians who disapprove of Gov. Tom Corbett’s performance, according to a poll released recently by The Morning Call and Muhlenberg College.
Percent of 2011 overnight visitors to the Philadelphia region who traveled by rental car.
70.3
17%
Percent of 2011 overnight visitors to the Philadelphia region who traveled by plane.
R. KENNEDY FOR GPTMC
The U.S. consumer confidence index for September. That’s up from 61.3 in August. A reading of 90 indicates a healthy economy and the index hasn’t been that high since December of 2007.
$9,340,000,000
Room nights booked at area hotels for the Patriot Games Tournament.
Number of people drawn to the Bucks County area for the 5th Annual Patriot Games Lacrosse Tournament.
GT COOPER PHOTOGRAPY
Tourism’s economic impact on the Philadelphia region in 2011. That’s a 7.5 percent increase over 2010 and a 12.5 percent increase over 2009.
863
10,000+
41%
30%
13%
Percent of 2011 overnight visitors to the Philadelphia region who traveled by bus.
Percent of Pennsylvanians who filed a federal tax return but paid no federal tax.
Percent of Americans who had no federal tax liability in 2010.
Percent of 2011 visitors to the Philadelphia area from the West Coast (defined as Alaska, California, Oregon and Washington state).
5%
32%
78,655
Attendees at the Made In America Festival
93,680
ED YOURDAN
Attendees at the Temple-Penn State game.
1,500,000
People who live-streamed the Made In America Festival, worldwide. Festival promoters presented the City of Philadelphia with $505,124 to cover festival-related expenses, including security.
70,000
Number of calls reportedly received by the NFL offices in New York after Monday’s game that ended with a questionable call by replacement officials.
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