Wisconsin Business Voice - July 2015

July 2015: Issue 15

Official magazine of Wisconsin’s Chamber

Emergency Preparedness Planning and Recovery Page 20

Inside: WMC Economic Survey Results p. 3 The Proper Role of the Judiciary p. 13 Innovation in Worker’s Compensation p. 28

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WISCONSIN

BUSINESS VOICE

In this issue…

From the Editor

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Every once in a while, someone strikes gold. That one idea. That one plan. We think we’ve struck gold in our own corner of the world with our video projects and specifically, our Two Minute Drill video series. These weekly episodes pack a lot of information into (about) two minutes to tell our members what’s happening at the State Capitol. From educating you about bills that will help your business, to alerting you when proposed bills may hurt your business, these short videos deliver distinct information in bitesize pieces to help you understand what can be elaborate and confusing subjects.

As the state chamber of commerce, it is up to WMC to deliver value to our members – to educate you on things you may not otherwise know. We have upgraded the way we send information you need, including our videos, this magazine, the daily Morning Digest and other publications. To get the most from your membership, be sure you’re receiving everything you want – and please let us know if there are other members of your team you want added to our mailing lists. The more people understand the issues, the louder our voice becomes.

Editor, Wisconsin Business Voice kpettersen@wmc.org P.S. Stay tuned later this summer for the debut of Two Minute Extras – another new video series highlighting WMC’s other program areas.

Wisconsin Business Voice is published quarterly by Wisconsin Manufacturers & Commerce. WMC is Wisconsin’s chamber of commerce, manufacturers’ association, and safety council representing businesses of all sizes and from every sector of the economy. Send address changes to WMC, P.O. Box 352, Madison, WI 53701-0352.

WMC's physical address is 501 E. Washington Avenue, Madison, WI 53703, (608) 258-3400. This publication is proudly printed on paper made in Wisconsin.

Kurt R. Bauer, WMC President/CEO Katy Pettersen, Editor (kpettersen@wmc.org) Jane Sutter, Designer (jsutter@wmc.org)

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Economic Envy

KURT BAUER, WMC

Worker Shortage Getting Worse:WMC Economic Survey Results L&S Electric: Bringing Hydroelectricity to Latin America

MIKE SHOYS, WMC

Latin America has Numerous Opportunities for State Manufacturers

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SCOTT MANLEY, WMC

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JIM MORGAN, WMC

WMC: Your Lobbying Vanguard at the Capitol First, Do No Harm

The Proper Role of the Judiciary 13

JUDGE REBECCA BRADLEY Highways Patched, but Needs Remain 15 State Unresolved

JASON CULOTTA, WMC

A Rare Opportunity that Just Makes Sense 16

GALE KLAPPA, WISCONSIN ENERGY Safe is Not Necessarily Enough, 17 Lockout/Tagout: According to OSHA

CHARLES PALMER, MICHAEL BEST & FRIEDRICH LLP

Well Within U.S. Mainstream with 18 Wisconsin State Business Loan Programs

TOM STILL, WISCONSIN TECHNOLOGY COUNCIL

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EMERGENCY PREPAREDNESS: ARE YOU READY?

Disaster Preparedness 24

RUSS CAIN, WMC Investing in Youth with Disabilities Leads to 26 How a Better Bottom Line Innovation in Worker’s Compensation 28

CHRIS READER, WMC

30 Reinventing a Wisconsin Family Busines Defending Your Legal Rights 37

JAMES BUCHEN Trade Promotion Authority 38

U.S. REP. POCAN (D-MADISON) AND U.S. REP. RYAN (R-JANESVILLE)

A Hotbead of Opportunity: Fond du Lac Works!

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MELISSA WORTHINGTON, FOND DU LAC AREA ASSOCIATION OF COMMERCE

Economic Envy

Kurt R. Bauer, WMC President/CEO

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he University of Minnesota Golden Gophers haven’t won Paul Bunyan’s Axe from the University of Wisconsin Badgers in a decade. Meanwhile, the Green Bay Packers have gone 9-1-1 versus the Minnesota Vikings since 2010.

Clearly, America’s Dairyland enjoys football bragging rights over the North Star State. But which state boasts the stronger economy?

Critics of Wisconsin Governor Scott Walker are obsessed with that question. In their mind, comparing the Wisconsin and Minnesota economies discredits Walker’s reforms and promotes the progressive policies pursued by Minnesota Governor Mark Dayton.

economically since at least the 1960s. Feldman cites many reasons for this, including Minnesota’s diverse economy and the vitality of the Twin Cities.

Minneapolis-St. Paul has several advantages over Wisconsin’s major urban centers of Milwaukee and Madison. Feldman points out the close proximity of the seat of state government in St. Paul to Minnesota’s flagship university in Minneapolis is an economic driver Wisconsin can’t match.

The Twin Cities also weren’t part of the Great Migration of people moving north to work in factories. Milwaukee was, as were Beloit and Racine, and working class neighborhoods in those communities were disproportionately impacted by the loss of manufacturing jobs to Asia in the 70s and 80s leaving a legacy of poverty and crime absent in Minnesota.

The Twin Cities also benefit from a lack of regional competition, according to Derek Thompson who wrote an article titled “The Miracle of Minneapolis” for The Atlantic.

The problem is that any history professor worth his or her salt Thompson said the Twin Cities’ only real competition is will tell you it is far too early in Walker’s tenure to determine Denver. Milwaukee, on the other hand, is geographically how his pro-business reforms have impacted Wisconsin’s caught between a rock and a hard place. The long-term economic competitiveness. That is rock is Chicago and the hard place is “A better Wisconsin especially true when you consider Walker’s Minneapolis-St. Paul, both of which first term was marred by protests and a are major draws for coveted young business climate will series of recall elections that delayed a professionals. lot of business decisions because of the lead to a better Wisconsin In addition to better college and uncertainty they created. professional football teams, Wisconsin economy.”

Even so, many indicators are bullish on has its own list of advantages over Wisconsin’s future economic prospects. For example, business Minnesota. Unlike Minnesota, Wisconsin has a fully optimism is sky high (see story on page 3) and many leading funded state employee pension fund. Taxes are declining in rankings on both business climate and economic outlook Wisconsin at the same time Governor Dayton has raised have shown dramatic improvement for Wisconsin since 2011 them. Dayton also increased Minnesota’s minimum wage when Walker took office. Minnesota hasn’t done nearly as and has driven up other costs of doing business west of the well in many of those same rankings.

Mississippi River. And when Wisconsin recently enacted a Right to Work law, Minnesota found itself surrounded on Still, Wisconsin does lag Minnesota in many economic three sides by states deemed by a majority of site selectors as metrics. Minnesota has more corporate headquarters, higher more business friendly. per capita income, a lower unemployment rate and its population is better educated. But all of the above was just Walker’s Wisconsin and Dayton’s Minnesota are a case study as true when Wisconsin’s governor was Democrat Jim Doyle of economic contrast. Minnesota has a head start, but a better and Minnesota’s was Republican Tim Pawlenty.

Wisconsin business climate will lead to a better Wisconsin economy. The opposite is true for Minnesota. BV As University of Minnesota Professor (and Wisconsin native) Roger Feldman recently wrote in the Minneapolis Star Tribune, Minnesota has been outperforming Wisconsin Follow Kurt on Twitter @Kurt_R_Bauer

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Worker Shortage Getting Worse, Holding Back the Economy Survey finds concern over rising health care costs and weak national economy

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he shortage of qualified workers is getting worse and is holding back Wisconsin’s economy, according to WMC’s semi-annual CEO Economic Survey. The survey of 306 top business executives also shows concern about rising health care costs on the eve of full implementation of the federal Affordable Care Act (ACA).

Seventy percent of survey respondents report having trouble hiring employees, up from 64 percent in January and 53 percent a year ago. More than half said a lack of qualified applicants was the top reason and nearly a third say they are having trouble finding employees for all levels and fields.

Health care affordability was listed as the second concern facing business leaders.

Forty-one percent of respondents from companies that offer employee health care benefits said costs rose between 1-10 percent in the last 12 months, while 46 percent said costs rose 11 percent or higher. Those numbers are likely to rise as the ACA’s previously delayed provisions take effect. When asked how employers plan to deal with health care cost increases, more than half said “increase employee contribution” and 25 percent said “decrease benefits.”

IT S ABOUT ’

LISTENING BECAUSE YOU HAVE IDEAS, PLANS AND GOALS FOR YOUR BUSINESS.

You never stop thinking about your business. Neither do we. Our Commercial Bankers are always at-the-ready with Commercial Real Estate and Commercial Banking expertise and support tools to keep your business on track. Plus, our Commercial bankers are based where your business is—right here in Wisconsin—and have been for more than 95 years. Success begins with a conversation.

LET’S TALK. CALL 608-252-1803.

Worker shortage and health care came up frequently in answers to the open2015 AnchorBank, fsb. AnchorBank is a service mark of Anchor BanCorp Wisconsin Inc. ended question “what do you believe is holding back the economy and job growth?” “Indecision, especially with six months, down slightly from January. But more than 70 percent immigration reform and health care,” was one response. Another see wages increasing by 2.1 percent or higher, including 36 percent was: “It has become so expensive and difficult to hire and retain who see wages increasing more than 3 percent. employees that there is no choice but to automate and that limits job growth.”

Bottom line is Wisconsin employers remain optimistic for growth and continue to seek ways to solve their labor shortage. Programs Business leaders rate the Wisconsin economy stronger than the like Wisconsin Fast Forward and WMC’s Future Wisconsin national economy and predict that trend to continue through the Project are helping to do just that. BV end of the year. In the next six months, nearly three-quarters say Wisconsin’s economy will see “good” to “moderate” growth and more than half of Wisconsin employers plan to hire in the next EQUAL HOUSING

LENDER

Wisconsin Business Voice

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EXPORTING Mike Shoys WMC Senior Vice President

L&S Electric: Bringing Hydroelectricity to Latin America

By Mike Shoys

L&S

Electric, Inc. is a family-owned Wausau-based company created in 1983 by the merger of Leverance Electric and Snapp Electric. They are a world-class supplier of products and integrated solutions for the hydroelectric industry.

Since the early 1980’s, their company has successfully supplied proven and reliable solutions worldwide for over 600 new and rehabilitated hydroelectric generating units – they estimate the company has been responsible for providing products and services for hydroelectric projects in 21 countries totaling over 25 gigawatts of generating capacity.

Their products range from sophisticated distributing valves, to complex plant operating control systems and proprietary software, most of which are manufactured in Wisconsin. Their domestic work also includes hydraulic power units, power distribution, and protection systems, motors, switchgear and power drives. The motor and generator repair division has been a mainstay of their customer service business for many years.

Melvin Lopez, VP Engineering Division, indicates their proprietary products and integrated systems allow them to compete in the international hydroelectric sector. L&S is one of a handful of companies worldwide who produce this sophisticated equipment – they provide installation, engineering, assembly and testing services and commissioning support. Their control products include governors, unit and plant control, communications, data and interface software.

The company’s international business activities began in the hydroelectric sector in Canada in the 1980's and have since expanded to Latin America, Asia Pacific and European countries including Scotland and Turkey. Their strategy for international expansion is based on key customer requests, a desire to grow and finding markets for new product development. Much of their foreign expansion is the result of their international reputation for engineering and product excellence. In many cases, existing customers ask them to enter new markets for projects the customer is developing. Their customers may be private consortiums, local municipalities, states or countries.

L&S works through a network of eight resellers who have marketing and/or engineering capabilities. While L&S does not enter into foreign partnerships, they often work as subcontractors to a prime contractor/consortium and bid work directly – 95 percent of their foreign business is bid work.

Lopez indicates the biggest challenge in their international market is political risk. Their projects range from small to multi-million dollars with long development times and equally long construction 4

durations. Knowing when to make a commitment to mitigate risks is a challenge. L&S resellers assist in assessing project feasibility, local conditions and political issues. L&S also engages local attorneys to help control risk exposure. In addition they face a number of barriers in each new market they enter including establishing costs of doing business, distance management and learning regional customs and standards.

L&S has overcome these obstacles through site visits, use of their resellers’ market knowledge, direct presentations and other strategies.

As do many companies, L&S also faces intellectual property risks in many markets. The company licenses products in many of those markets and has developed redundant security code systems to protect their proprietary control system computer codes.

Foreign work has been beneficial for the company in a number of ways. Massive hydroelectric projects are much more prevalent in developing countries than in more mature markets like the U.S. and Europe. While L&S has people onsite during development and construction, most of the engineering work and equipment production occurs in Wisconsin. Lopez says foreign work often entails engineering challenges that increase the company’s technical capabilities. For instance, power grids in less developed countries may require very unique engineering solutions to provide reliable and consistent grid frequency or voltage control. In addition, L&S modernizes a lot of older plants which raises unique engineering challenges and results in retaining increased staff expertise domestically.

Along with their international reputation, L&S uses other marketing strategies to attract foreign customers. For the past seven

years they have hosted a hydroelectric controls seminar in Wausau for their domestic and foreign customers, and they participate in international trade shows for the hydroelectric industry.

Lopez offered these helpful tips to companies entertaining foreign expansion: • Research in detail the market regions you want to enter and clearly identify and understand the competition, product and service needs, costing strategies, political risks and business culture.

• Put great effort in engaging representatives to understand your industry and business model.

• Start slow and with proven products and services you can support from abroad.

• Hire and train people who understand the language and the culture in the regions you want to work, but they must also be technically and commercially proficient in the products and services you want to provide.

• The company must embrace the cultural differences if you want to be successful.

• Develop strong relationships with partners and customers, especially in Latin America.

L&S is a largely unknown success story in Wisconsin. This company is a great example of the ingenuity, drive to succeed and grow, and technical and manufacturing expertise indicative of so many Wisconsin businesses. BV

Congratulations Mike on Your Retirement!

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Mike Shoys has been an integral member of WMC’s staff since 1995.

Mike led WMC’s 2-year remodeling project in 2012-2014. Here he is with Tom Boldt, CEO of Boldt Construction, the contractor for the remodel.

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As COO, Mike handled the finances for WMC and worked closely with WMC’s officers to ensure sound financial management of the organization.

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A charter board member of the UW E-business Consortium, Mike worked closely with Raj Veeramani, professor at UW-Madison.

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Mike worked with a lot of global business groups.

Here he is with a visiting group arranged by the State Department.

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Here is Mike on the steps of WMC’s recently remodeled headquarters.

Thanks for all you’ve done for WMC, Mike.

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We’ll miss you!

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5 Wisconsin Business Voice

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Latin America Has Numerous Opportunities for State Manufacturers

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atin America continues to provide numerous opportunities for Wisconsin companies to begin or expand their exporting efforts – particularly Mexico and Brazil, which are two of the state’s 10 largest export destinations.

Total Wisconsin exports to Latin America increased by four percent from 2013 to 2014, and totaled $4.6 billion – representing about 20 percent of all state exports. Most of that increase was due to a 13 percent jump in exports to Mexico, which is Wisconsin’s No. 2 export destination.

The largest product category being exported to Latin America from Wisconsin is auto and vehicle parts, which account for 10 percent of all state exports to the region. In 2014, auto parts exports to Latin America grew by 41 percent, with most of the goods being shipped to Mexico.

The second-largest product category being shipped to Latin America is earthmoving equipment, which declined by 23 percent from 2013 to 2014. Much of that equipment is used in the mining sector, and slowdowns in the global minerals industry affected purchases of new capital equipment. While exports in that category were down overall, Peru and Brazil both experienced increases in 2014.

Medical, dental and veterinary instruments are the third-largest export category to Latin America, and shipments of those goods from Wisconsin rose by 24 percent last year.

Of the Latin American countries, Mexico is clearly the logical first choice for Wisconsin companies because of its proximity to the U.S. and because of Mexicans’ need for and familiarity with American-made products. Because of those reasons and others, 12 percent of all exports from Wisconsin companies – about $2.8 billion – are destined for Mexico.

Mexico’s growing economy also offers Wisconsin manufacturer suppliers opportunities in the automotive and

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aerospace sectors.

Mexico is the seventh-largest carmaker in the world, and major automotive manufacturers are increasing their investments, creating opportunities in the secondand third-tier supplier markets.

Aerospace is also a growing sector for Wisconsin manufacturers.

Additionally, reforms in the energy and communications laws open these sectors for Wisconsin companies.

WISCONSIN EXPORTING FAST FACTS Wisconsin companies exported more than $5.5 BILLION in products in the first quarter of 2015.

TOP DESTINATION FOR WISCONSIN EXPORTS FIRST QUARTER 2015

34.7%

13.2%

CANADA

MEXICO

6.1% CHINA

3.5%

UNITED KINGDOM

3.5% JAPAN

WISCONSIN’S TOP EXPORTED PRODUCTS FIRST QUARTER 2015

9.8%

26.7%

MEDICAL/ SCIENTIFIC INSTRUMENTS

INDUSTRIAL MACHINERY

9.5%

ELECTRICAL MACHINERY

7.0%

VEHICLES AND PARTS

4.7%

PLASTICS

PRODUCTS WITH SIGNIFICANT GROWTH OVER 2014

141%

ORGANIC CHEMICALS

49%

SAUSAGE

46%

AIRCRAFT AND SPACECRAFT

6%

PLASTICS

4%

MEDICAL AND SCIENTIFIC DEVICES

Brazil, Chile, Peru and Colombia Source: U.S. Census Bureau data as reported by Global Trade Information Services round out the top five Wisconsin export destinations with exporting efforts in Latin America among Latin American countries, with and around the world. Those trade exports to Brazil totaling $515 million representatives, along with WEDC’s in 2014 – an 8 percent increase over the in-state market development directors, previous year. provide companies with the insights With a population of 200 million, Brazil is and contacts companies need to develop among the top 10 largest economies in the and execute market-specific business world – the country has a growing middle development strategies. BV class and is making significant investments Visit the Wisconsin Economic Development in infrastructure. Opportunities exist Corporation’s website www.InWisconsin. for Wisconsin companies in almost com/exporting for more information on every sector, but especially in industrial exporting to Latin America or other parts and electrical machinery, agricultural of the world. equipment, medical and scientific instruments, vehicles and construction equipment.

The Wisconsin Economic Development Corporation (WEDC), the state’s lead export organization, has a team of overseas trade representatives who assist

LOBBYING

Scott Manley WMC Vice President of Government Relations

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WMC: Your Lobbying Vanguard at the Capitol

awmaking and public policy development is often an exercise in managing threats and opportunities.

Legislators introduce bills that can be either tremendously helpful to businesses, or profoundly harmful. But none of it happens by accident – if a bill is introduced at the Capitol, it is almost always because an interest group is pushing it.

Our role as business lobbyists is to aggressively advance a free market agenda to help improve our business climate, while continually defending against legislation that would add cost and operational burdens to employers.

We also help educate lawmakers on how to craft policies workable for businesses, and remind them that employees – and job creation as a whole – benefit when businesses are successful.

• Assembly Bill 231 would hold employers financially liable for the abusive actions of their employees in the workplace by creating a new right to sue businesses.

• Senate Bill 166 would create a new standard for workplace discrimination based upon whether a person is employed or unemployed, thereby opening the door to a whole new line of discrimination litigation.

• Senate Bill 150 would pile new punitive damages on top of existing remedies for cases involving employment discrimination – a great way to make suing businesses more attractive to trial lawyers.

• Senate Joint Resolution 12 seeks to deprive businesses of constitutional rights and would specifically eliminate the right to corporate free speech.

Although there are hundreds of lobbying organizations walking the Our team of WMC lobbyists works hard to help lawmakers halls of the Capitol building, WMC is among the largest and most understand that bills like those mentioned above will harm influential. During the 2013-14 legislative session, WMC logged businesses and make Wisconsin a less 9,920 hours of lobbying activity – more than any other group attractive place to invest in jobs. We Sometimes the greater in the state. often remind legislators that every Yet we are up against formidable opponents who routinely measure of a Legislature is dollar a business spends on lawsuits advocate against the interests of businesses as they push for or regulations is a dollar they can’t what they don’t do. laws and regulations that could significantly damage our spend to increase wages, hire new economic competitiveness. employees, or invest in research or product development.

Take the 2011-12 legislative session as an example. Labor unions, trial lawyers and radical environmental groups collectively spent While it’s great to chalk-up huge victories like passing Right to $10.9 million and logged 81,434 hours lobbying policymakers. Rest Work, preventing really bad bills from becoming law is critically assured they were not trying to convince lawmakers and regulators important too. Sometimes the greater measure of a Legislature is how to make operating a business in Wisconsin easier or more what they don’t do. affordable. Quite the opposite.

If history is any indication, thousands of lobbyists will spend We are only six months into the current legislative session but more than 400,000 hours lobbying this session. It’s the manhave already seen an abundance of terrible bills floating around the hour equivalent of nearly 200 people spending 40 hours per week Capitol. Consider the impact of these bills on your business, and on lobbying for an entire year. That’s a lot of lobbying, and not all of it Wisconsin’s overall business climate: will be good for businesses. WMC members can rest assured our team will continue to play offense and defense on their behalf at the • Senate Bill 2 would increase the minimum wage to $10.10 per Capitol. BV hour, and Assembly Bill 264 would increase it to $15.00 per hour. Studies have predicted Wisconsin would lose thousands of Follow Scott on Twitter @ManleyWMC jobs if either of these bills were enacted.

• Senate Bill 160 would eliminate at-will employment in Wisconsin, and prohibit an employer from discharging an employee without “good cause.”

Wisconsin Business Voice

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WMC at Home and on the Road

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WMC toured Charter Manufacturing of Saukville.

Pictured here L-R: Jason Culotta, WMC Director of Tax & Transportation Policy; Scott Manley, WMC Vice President of Government Relations; John Mellowes, Chairman & CEO of Charter Manufacturing; Eric Bott, former WMC Director of Environmental Policy; and Kurt Bauer, WMC President/CEO.

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As the state chamber of commerce, WMC hosts school class groups from all over the state. This group of Janesville high school students met oneon-one with their local representative, Rep. Amy Loudenbeck (R-Clinton), at WMC’s headquarters in Madison.

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Universal Die & Stamping was honored by the Wisconsin Safety Council for achieving achieving 1 million work hours without a lost time incident.

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Green Bay Packers President Mark Murphy, pictured at center here, spoke to the WMC Board of Directors. He is pictured here with WMC’s Kurt Bauer and WMC Chairman Dan Ariens, Chairman/ CEO of Ariens Company.

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T . he Wisconsin Safety Council teaches First Aid classes throughout the year. Pictured here are WMC staff attending the course.

U.S. Congressman Paul Ryan was honored by the National Association of Manufacturers (NAM).

He is pictured here with WMC’s Kurt Bauer and NAM's Aric Newhouse.

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Steve Benzschawel, WMC’s Business World Program Director, delivered the keynote address about working with the millennial generation to a sold-out crowd at a Michael Best & Freidrich LLP seminar.

Speaker Robin Vos (R-Rochester) spoke to the WMC Board of Directors this spring. Pictured here L-R: Pat Kampling, Chairman/President/CEO of Alliant Energy Corporation; Dr. Damond Boatwright, Regional President/CEO of Hospital Operations for SSM Health Care of Wisconsin; Speaker Vos; Dan Ariens, Chairman/CEO of Ariens Company and WMC Board Chairman.

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Wisconsin Safety Council Conference Planning Committee met to determine the educational programming for 2016 conferences.

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BUSINESS & EDUCATION Jim Morgan WMC Foundation President

First, Do No Harm Education discussions hit a fever pitch

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ducation in Wisconsin has certainly been in the news the past few months.

For three decades WMC members have been encouraging the state to establish a set of state standards and develop an accountability system that allows us to compare schools and districts within Wisconsin and nationwide. We adopted standards in math and English, and the vast majority of school districts have those in place. Science and social studies standards will face a more difficult road due to differing political philosophies. Where we really missed an opportunity is in assessment: • A national test that was not quite ready for prime time was rolled out with a series of problems.

• An inability to agree on a common set of standards, and exams tied to those standards, has led to the acceptance of anywhere from 3-5 state exams from which school districts can select… which will not be comparable across districts.

• School report cards are now on hold because of an inability to reach agreement on what really matters.

And so we will spend millions of dollars on public, private and charter schools with little ability to measure success. And, the rhetoric will focus on the extremes:

• We will experiment with students using a variety of methods of education – some based on research, some not – and not have a definitive answer on who is doing well.

• We will fight over whether Wisconsin has one of the best educational systems in America or if we are one step away from disaster.

• We will either “destroy public education” or “save the state’s poor children” with vouchers.

• We will argue every teacher and the profession should be “honored” or suggest removing the educational requirements needed to be certified in a classroom.

The fascinating part is very little of this reflects Wisconsin.

Taken as a whole, our schools are good, very good. But there is certainly more work to be done and it can be accomplished through an increased sense of urgency by educators and a consistent, rational and informed voice from outside stakeholders.

all of society’s problems AND complain they are too involved in children’s character education, student nutrition and before and after school programs. Our teacher preparation programs have to go off campus and get into schools in order to keep up with the challenges teachers face. Parents have to engage. Businesses have to offer workplace experiences and jobs. And teachers have to become classroom managers engaging as many outside resources as possible.

In short, we all have to commit.

But I’m not sure you can legislate commitment.

I have the opportunity to have small and large group discussions with people of every occupation as I travel all over Wisconsin – to the tune of 20,000 miles per year. When you truly listen to the conversations, what you find are teachers, business leaders, administrators and community members who care about their towns, schools and students and will do anything they can to make them stronger. They want their kids to get a good education. They want them to be career, college and community ready. They want them to be successful. And they want them to stick around! On a micro-level (locally) we seem to be doing much better than at a macro-level (state).

Hippocrates is often referenced as the “Father of Medicine” and the author of the Hippocratic Oath. Although not actually in the oath, a statement often referenced as being a part of it belongs to Thomas Inman around 1860 – “Practice two things in your dealings with disease: either help, or do not harm the patient." In modern day, that has become “First, do no harm.”

There is always danger when outsiders offer simplistic solutions to complicated challenges. And inserting yourself in a situation where you know just enough to be dangerous is often fraught with peril.

Business leaders know exactly what I am talking about, especially as it relates to regulations.

Schools are complicated places with few simple solutions. We all need to engage in their improvement. But keep in mind, “First, do no harm.” Good advice for all of us working on educational improvement. BV

Follow Morgan on Twitter @JimMorgan1960

Today’s students are dramatically different in demographic make-up, educational needs, technological knowledge and family expectations. Thinking yesterday’s educational system will serve them is naïve. We cannot simultaneously ask the schools to fix

Wisconsin Business Voice

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MADE IN Cardiac Science Did you know 13 percent of all workplace fatalities stem from sudden cardiac arrest? The only effective treatment is a shock from a defibrillator, administered as soon as possible.

Defibrillation within three minutes of sudden cardiac arrest increases the chances of survival to 70 percent. Shock within one minute of collapse raises the survival rate to 90 percent. There is a Wisconsin manufacturer who designs and manufactures Powerheart速 automated external defibrillators (AEDs). Cardiac Science is headquartered in Waukesha and has a manufacturing facility in Deerfield. Cardiac Science designed the Powerheart G3 Plus automatic AED so most anyone could use it. In fact, once the defibrillation pads are applied, the AED itself determines if a shock is required and administers one if needed. When someone is suffering from sudden cardiac arrest, every second counts.

If there ever comes a time when you need to use a defibrillator to save a life, be proud knowing it very well could have been made in Wisconsin.

500 Burdick Parkway Deerfield, WI 53531 (608) 764-1919 Established in 1913 www.cardiacscience.com

Gamber-Johnson 3001 Borham Avenue Stevens Point, WI 54481 (715) 344-3482 Established in 1954 www.gamberjohnson.com

Gamber-Johnson originally manufactured wooden stereo consoles, but has evolved into a global leader in vehicle mounting equipment for electronics used in commercial and government fleets. Their products include vehicle mounting systems for laptop and tablet computers, console systems for equipment storage, mounting radios and light and siren controls. Soldiers and police officers around the world depend on their products to keep the tools they need close at hand. Emergency workers such as police officers, ambulance drivers and firefighters use their vehicle docking stations and police consoles to keep medical and communications gear charged and ready to go. The next time a police car whizzes by, know the mount holding its dashboard computer safely in place might have been made in Wisconsin.

WISCONSIN Wieser Concrete Products, Inc. The Midwest is known for its weather changing in an instant. Unfortunately, sometimes those drastic and immediate changes create a region prone to tornadoes. The Badger State experiences an average of 23 tornadoes per year. Bearing that in mind, one safety aspect every Wisconsin employer should consider is where their employees might go to remain safe during a weather emergency. Wieser Concrete Products, located in Maiden Rock, provides companies all over the nation with such a place. Founded in 1965, Wieser manufactures an extensive line of precast concrete products, including above ground, precast concrete storm shelters. The storm shelters are so heavy there is no need to anchor them and one shelter provides a safe haven for up to 12 individuals at one time. Everyone should have a safe place to go during severe weather.

Luckily, some of the safest and most durable storm shelters are made right here, in Wisconsin.

W3716 US Highway 10 Maiden Rock, WI 54750 (715) 647-2311 Established in 1965 www.wieserconcrete.com

Drunk Busters of America, L.L.C.

W6279 County Road F Brownsville, WI 53006 (920) 583-2491 Established in 1995 www.drunkbusters.com

Drunk Busters Goggles simulate effects of impairment, including reduced alertness, slowed reaction time, confusion, visual distortion, alteration of depth and distance perception, reduction of peripheral vision, poor judgment and decision making, double vision and lack of muscular coordination. Drunk Busters Goggles are available in five different simulated blood alchohol content (BAC) levels, a Drug Simulation Goggle, two Sleep Deprivation Goggles, a Cannabis (marijuana) Goggle, and an LSD Goggle. All 10 of their goggle styles, three drunk driving DVDs and their Stop, Drop, and Roll fire safety vests are manufactured here in Wisconsin. The company is celebrating 20 years in August – they have worked with more than 17,000 customers and have shipped products to 82 different countries.

Showcase your product in Wisconsin Business Voice Contact Samantha Sepic, ssepic@wmc.org Wisconsin Business Voice

11

Company News

WAUSAU Financial Systems Celebrates New Headquarters

WAUSAU Financial Systems, a Deluxe Corporation company, has moved from Mosinee to Wausau. Their new office reflects the evolution of the company from a hardware manufacturer to a technology services and solutions business. The layout allows WAUSAU employees to more effectively collaborate and innovate and allows additional room for growth. WAUSAU provides best-in-class technology, services and solutions that integrate receivables, accelerate deposits and payments, and eliminate paper.

Mercury Marine Expanding Global Headquarters

Wisconsin Private Sector Leaders Announced as Manufacturing Council Members

Earlier this year, U.S. Secretary of Commerce Penny Pritzker announced the appointment of 30 private sector leaders to the Manufacturing Council for the 2015-16 charter term. The Council was established in 2004 to serve as the principal private sector advisory body to the Secretary of Commerce on matters relating to the U.S. manufacturing industry. The recently appointed Manufacturing Council members from Wisconsin are:

• Jan Allman, President, Chief Executive Officer & General Manager, Marinette Marine Corporation, Marinette Are you a manufacturer?

• Bradley Crews, Chief We want to hear from you!

Operating Officer, NAFTA, Recent Manufacturing Council CNH Industrial, Racine addition Jan Allman of Marinette Marine is interested to hear which • Irwin Shur, Vice President, federal policies are most affecting your General Counsel & Secretary, business. Email kpettersen@wmc.org Snap-on, Kenosha with your feedback.

Mercury Marine, the world leader in marine propulsion and technology, is adding a 45,000 square foot expansion to its electrodeposition paint system that will double its current processing capabilities. The project will be complete by January 2016 and the new system will be operational by the fourth quarter next year. With this expansion, Mercury Marine has invested more than $580MM into capital investments and R&D since 2009.

“We are developing a new state-of-the-art coating system that gives our engines superior corrosion and warranty protection,” said John Pfeifer, Mercury Marine President. “This process enforces our ability to make a better product for our customers who expect extreme reliability in their Mercury engines. This expansion will not only create jobs, it will improve our flexibility, quality and improve the environment.”

In Memoriam

Jack E. Pregont, 85, Founder and Chairman Emeritus, Prent Corporation, Janesville.

Jack Pregont founded Prent Corporation, a privately held thermoform plastic company in 1967. Fifteen years later he founded GOEX Extrusion, an extruder of plastic sheet and rolls stock. Today Prent Corporation is the leading global manufacturer of thermoform packaging for

Greenheck Innovation Wins Governor’s New Product Award

Greenheck Innovation was awarded second place in the Governor’s New Product Award competition for its variable geometry nozzle used on laboratory exhaust systems. Greenheck’s nozzle is environmentally sustainable, saves energy and ensures laboratory exhaust fumes are safely discharged away from the roof deck at a constant velocity. According to Jim McIntyre, President and CEO of the Greenheck Group, this award is another validation of Greenheck’s focus on innovation and continued product development. The awards program is produced by the Wisconsin Society of Professional Engineers and was developed to recognize the full spectrum of benefits stemming from the research and engineering of new products.

the medical industry and a fast-growing leader in packaging for the electronics and consumer industries. Prent employs over 2,000 people at nine facilities throughout the country, and the world.

Over the past half-century, Jack Pregont was recognized as one of the founders of modern thermoforming. In 1980 he and six others created the “Thermoforming Institute” of the Society of Plastic Industry and he served as the organization’s first chairman. In 1989 he was named “Thermoformer of the Year” by the Society of Plastic Engineers and in 2007 the

Thermoforming Division of SPE honored him with their “Lifetime Achievement Award” for his significant contributions to the plastics industry.

Thanks to Jack’s leadership, Prent is renowned today for its design, engineering and production excellence. Since its founding, the company has garnered dozens of packaging awards including 15 WorldStar packaging awards in the “medical or pharmaceutical packaging” categories, more than any other company in the world.

The Proper Role of the Judiciary By the Honorable Rebecca G. Bradley

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hen evaluating candidates for judicial office, voters may find useful information to be somewhat lacking. Unlike candidates for partisan offices, judicial candidates must refrain from taking positions on issues that may come before the court. Instead, judicial campaigns properly focus on a candidate’s ability and willingness to uphold and apply the law regardless of personal views.

While most judicial candidates highlight their impartiality, independence and adherence to the rule of law, in reality jurists approach their work with one of two distinct judicial philosophies: one is outcome-neutral and guides judges to apply the law as it is written, informed by principles such as judicial restraint and respect for the separation of powers among the three branches of government; the other is results-oriented and attempts to work a form of “justice” informed largely by the individual judge’s personal beliefs. Choosing among candidates espousing these competing philosophies can have stark consequences for the citizens of Wisconsin.

The people of Wisconsin are best served by judges who understand and embrace their duty to state what the law is and not what they prefer it to be. In practice, this means objectively interpreting the law according to what the legislature wrote, regardless of outcome.

While judges appropriately defer to legislative policy choices, they do provide an important check on what the majority desires by striking down laws that violate individual rights guaranteed by the federal and state Constitutions. Constitutionally valid laws should be applied as written, without judicial revision or rejection.

In contrast, some judges adopt a philosophy of imposing what they believe is right to effect social or political change, regardless of what the law says. The obvious danger of employing such a philosophy is the inherent subjectivity in determining what is “right,” as personal conceptions of right and wrong can differ widely among different people. Adopting such a philosophy leads the judiciary to invade the province of the legislature by creating laws rather than applying them. This approach results in a few judges – and sometimes just one judge – making a decision that cannot be readily corrected through democratic processes.

This is not what the founders of our country or our state envisioned.

Instead, the representatives of the people, elected through democratic processes, are responsible for creating the laws, restrained by the Constitution from infringing protected individual rights and liberties. If the people do not like the intended or unintended consequences of constitutionally valid laws, they can employ the political process to change them. It is not the role of the judiciary to set aside such results by fiat.

In Federalist No. 78, Alexander Hamilton succinctly summarized the role of the judiciary: The courts must declare the sense of the law; and if they should be disposed to exercise WILL instead of JUDGMENT, the consequence would equally be the substitution of their pleasure to that of the legislative body.

Judge Rebecca Bradley with WMC’s Scott Manley and Kurt Bauer.

In other words, the duty of the judge is to say what the law is, not what the judge may wish it to be. How does a judge determine what the law is? Again, Hamilton instructs us: To avoid an arbitrary discretion in the courts, it is indispensable that they should be bound down by strict rules and precedents which serve to define and point out their duty in every particular case that comes before them…

The rules to which Hamilton refers include those gleaned from examining the text, structure and history of laws, interpreted as their drafters wrote them. Precedents refer to the body of case law. Judges who are properly restrained by an understanding of their role to interpret and apply the law will adhere to well-established precedent unless the Constitution commands otherwise.

America was founded on the principle that Constitutional laws enacted by the people’s representatives in the legislative branch of government are to be upheld by the judicial branch, not secondguessed. Laws are appropriately subject to judicial review, not a judicial veto. The judiciary should defer to legislative policy choices, not impose their own.

In Federalist No. 17, Hamilton recognized State government, distinct from the federal government, as “being the immediate and visible guardian of life and property…” Accordingly, the importance of the State courts in which such power is entrusted – by the people – cannot be overstated. When judges in Wisconsin take office, they swear to support the Constitution of the United States and the Constitution of the State of Wisconsin. In exercising this duty, judges should respect the constitutionally prescribed roles and powers of the co-equal legislative and executive branches of government. BV Judge Rebecca Bradley was recently appointed as a Wisconsin Court of Appeals Judge by Gov. Scott Walker. Previously she served as a Milwaukee County Circuit Court Judge.

Wisconsin Business Voice

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Demographically Challenged Some areas of the state’s population are growing while others are declining. The Applied Population Lab at the UW-Madison engages in projects using demographic data. Here is some interesting data showing the change in school enrollment over a five year period.

School District Enrollment Change 2008/09 to 2013/14 Declined 10% or more Declined 4% to 9.9% Declined or increased by less than 4% Increased 4% to 9.9% Increased 10% or more

www.futurewi.org

STATE BUDGET Jason Culotta WMC Director of Tax & Transportation Policy

A

State Budget Challenges – How Did We Get Here?

s the Legislature winds down this particularly difficult state budget cycle, any outside observer may wonder… how did state government get its finances out of line?

As with any financial affair, there are two sides to the ledger: revenues and expenditures. Let’s start with state revenues.

Half of the state’s tax revenues are derived from the personal income tax (including taxes on most businesses, organized as passthrough entities like LLCs and S-corporations), one-third from the five percent sales tax, and the rest from smaller sources like corporate income, cigarettes, public utilities and insurers.

The state was estimated in June 2013 to bring in total tax revenues of $28.5 billion – that’s after a $650 million income tax cut for the two-year budget concluding on June 30 of this year was accounted for.

In January 2014, tax revenues were estimated to grow to $29.4 billion, an increase of $900 million. This drove another tax-cutting law in March 2014 which cut income taxes again, lowered income tax withholding tables and provided $406 million in annual relief by removing about half of the property tax levy for technical colleges, with the state picking up the cost. State revenues declined to $28.95 billion.

Lastly, in January of this year, estimates came out showing a decline in expected revenues to $28.4 billion for this same two-year period, a half-billion dollar reduction from nine months earlier and less than the state was initially estimated to collect in June 2013.

These estimates were all determined by the non-partisan Legislative Fiscal Bureau using national economic forecasting data. Forecasts are just that – trying to project the future – so it’s difficult to assign blame here. Obviously, economic factors can change even on a quarterly basis.

The current 2015-17 budget being debated is estimated to generate $30.8 billion in new revenues, an increase of $1.9 billion over the base budget year. With so much new tax revenue coming in, how can the state struggle to balance its budget?

That requires a discussion about the other side of the equation: state spending. The state’s largest programs consume nearly threequarters of state revenues and are known as “the big five” among policymakers, including:

• K-12 schools (along with related property tax relief, comprises about 39% of the budget) • Medical assistance (15%) • UW System (7%) • Corrections (7%) • Shared revenue aids to local governments (6%)

K-12 schools have long been the single largest budget item and will continue to be. But the biggest area of spending growth is occurring in medical assistance, which has seen sustained annual increases in recent years which will continue without major reform. For the 2011-13 state budget, nearly $1.4 billion in new state revenues were allocated to health care costs, much to backfill one-time federal stimulus funds spent in the previous budget. In 2013-15, the increase for these costs was $850 million and is expected to exceed $680 million in the new budget.

This annual pressure to consume huge volumes of new revenue is driven by the fact that one in five Wisconsinites are covered by the BadgerCare program (over 1.1 million people).

While income taxes were reduced twice in the previous two years and the Manufacturers’ Tax Credit continues to phase in, there is still much more work to be done to improve the state’s tax regime, which was still #43 in the Tax Foundation’s 2015 Business Tax Climate index. Healthy growth in state tax revenues will allow both for continued tax relief and the state’s continuing obligations to be met.

State revenues and spending both impact the budget, but the best insurance for such policies is the retention of a reasonable balance in the General Fund. State law actually prescribes a reserve of two percent of general fund spending (about $315 million this year), but that provision has been routinely deferred and replaced with a $65 million reserve which has proven insufficient to meet the volatility of changing revenue estimates.

The challenge is always to come up with funds to place in reserve when so many other pressing demands exist. Wisconsin does have $279 million in a “rainy day fund” which can be appropriated as a one-time cushion. Perhaps utilizing some of those funds would help policymakers meet the two percent balance and provide some comfort in budgeting on an automatic basis. BV

Follow Jason on Twitter @JGCulotta Wisconsin Business Voice

15

A Rare Opportunity that Just Makes Sense

By Gale Klappa

T

his summer, the country’s newest Fortune 500 company will likely NOT be headquartered in New York, Chicago, Minneapolis, or even Omaha. This once-in-a-generation opportunity will be achieved right here in Wisconsin. The new enterprise will be called WEC Energy Group, and it will be established after approval of Wisconsin Energy’s acquisition of Integrys.

John Reed, a nationally recognized expert with decades of experience in transactions such as this one, has estimated that – over the long-term – the operational savings of the combined company would total as much as $130 million annually.

So the arrival of a new Fortune 500 company is certainly good news, but it’s only the beginning of the benefits the state of Wisconsin will realize over the next decade.

Beyond those impressive statistics, there will be other opportunities to realize efficiencies for customers. For example, within the next 10 years as the electric grid becomes smarter, customers have more personal billing options and the need grows for more robust systems to protect customer information, it’s highly likely both We Energies and Wisconsin Public Service will need to invest in new automation and customer systems. The estimated cost would be approximately $150 million for each company. By purchasing just one set of systems to serve both utilities, customers could save $150 million of capital costs.

Given the geographic proximity and business similarities of the two Wisconsin utilities, customers could see as much as $1 billion of savings over the next 10 years through a combination of lower capital and operating costs.

We’re committed to reliability, customer satisfaction, environmental stewardship – and, yes, to the delivery of cost savings and competitive pricing over the long run.

Of course, the motivation for states across the nation to land Fortune 500 company headquarters goes far beyond pride. Real economic benefits flow to cities and states that serve as the home base for these headquarters.

The new company will include We Energies and Wisconsin Public Service. And it’s clear that Wisconsin customers have the highest potential for cost savings from this transaction.

The specific areas for potential savings have been identified by the state’s public service commission staff, a national energy expert and the company. Let’s take a closer look.

Public Service Commission staff indicated the combined company could realize savings “upwards of $600 million” in long-term resource planning alone based solely on the larger power plant portfolio of the combined company.

The combination of Wisconsin Energy and Integrys was carefully crafted to create a strong electric and natural gas delivery company with deep operational expertise, scale and the financial resources to meet the region’s future energy needs.

We will continue investing in the energy infrastructure so critical to job creation and growth of the Wisconsin economy… so when the future gets here, it will be a bright one. BV Gale Klappa is chairman of the board and chief executive officer of Wisconsin Energy.

Save the Date Wednesday, December 9 ECONOMIC SUMMIT

Monona Terrace Community & Convention Center Madison

Lockout/Tagout: Safe is Not Necessarily Enough, According to OSHA A confusing walk through the rules, exceptions and international differences

By Charles Palmer

I

n the April Edition of Wisconsin Business Voice, Wisconsin Safety Council Director Janie Ritter identified the need for consistent machine safety measures across national borders. There are at least two cases pending in Wisconsin where an employer’s multimillion dollar machine has been determined by OSHA not to comply with OSHA lockout standards.

The problem in these cases is not in safety during production, but safety during maintenance. Some machines are designed so electrical, hydraulic or other energy supply is needed during maintenance to (slowly) move machine parts. But maintenance while the machine is energized may violate the U.S. OSHA lockout standard. This conflict in design and the law may arise from international differences.

The most significant difference between lockout requirements in the U.S. and Europe (which generally applies ISO requirements) is the required method to isolate machinery from its energy source during maintenance. In Europe, ISO requirements may allow for lockout compliance using electrical control systems with a “high level of design reliability.” For example, a machine may have a switch interlocked to a guard, such that when the guard is open the machine cannot run. Even though the power is still flowing to the machine, this may be compliant with ISO, so long as this control system has a high level of design reliability.

OSHA regulations in the U.S., however, do not allow employers to rely only upon design reliability of control systems. OSHA requires that it be impossible to re-energize the equipment when locked out. OSHA defines an energy isolation device to exclude “push buttons, selector switches and other control circuit type devices.”

The assumption built into the OSHA regulatory scheme is that switches can, and do, fail.

Muddying the waters further is the exception in U.S. OSHA’s lockout standard for “minor servicing.” Under this exception, physical disconnection is not required for “minor” servicing activities, provided the work is performed using alternative measures which provide “effective protection.” There are a lot of challenges to meeting the definition of “minor” in that exception.

But the point is; an interlocked switch, such as that described earlier, may meet the effective protection requirement of the minor servicing exception, but not the rule itself. If the machine requires an energy supply during non-minor servicing, the employer has a problem. Push buttons, selector switches and other control circuit type devices, like the interlocked guard in the example, will generally not be safe enough, according to OSHA.

This places U.S. employers in a difficult spot. A multimillion dollar machine may be perfectly legal to operate, but impossible, or impractical to maintain, according to OSHA requirements. So an employer may find itself in the position of having to defend the safety of its brand new state-of-the-art machine. One legal defense to OSHA’s position is found in the language of the regulation itself. The regulation “scope” statement says it covers “servicing and maintenance of machines in which the unexpected energization, or start-up of the machine or equipment, or release of stored energy, could harm employees.” OSHA believes this requires the employer to demonstrate there is no possibility of unexpected energization or start-up. But, in one case, the fact that the machine had a horn that would sound before start-up, was deemed to refute the “unexpected” startup requirement, and the OSHA citation was vacated.

Unfortunately, given the confusion between the law in the U.S. and other jurisdictions, it is not always clear whether a machine is OSHA compliant. There may be defenses to OSHA’s conclusion, but most employers just want to follow the law, not hire a lawyer to demonstrate that the machine – which was recently purchased, with all the bells and whistles and at a high price – complies with the law. The obligation should be on the manufacturer of the machine but their focus is on safety during normal operation, and the international differences on lockout are confusing.

Until the law changes, U.S. manufacturers should consider involving maintenance and safety managers in machine purchase decisions and ask the simple question: Can maintenance practically be completed with the machine locked out so energy sources are disconnected, not just turned off by buttons, switches or other control circuit devices? If not, consider Janie Ritter’s helpful suggestions from her column on Safety Excellence in the April edition. BV

Chuck Palmer is an attorney with Michael Best & Friedrich LLP. He is the Office Managing Partner of the firm’s Waukesha office and part of the firm's Advanced Manufacturing and Energy teams.

Wisconsin Business Voice

17

Wisconsin Well Within U.S. Mainstream with State Business Loan Programs

By Tom Still

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isconsin is among at least 48 states that operate state business loan programs and it may fail to qualify for a matching federal small business initiative if such programs are eliminated, according to research by the Wisconsin Technology Council.

Information from four national sources indicates that 48 states have small business loan programs, which are a precursor for qualifying for one of a handful of matching programs through the federal government’s State Small Business Credit Initiative.

Data comes from the State Science and Technology Institute, the Center for Regional Competiveness, the Center for Community and Economic Research and the Praxis Strategy Group, all organizations with a history of tracking state economic development trends.

The $1.5 billion State Small Business Credit Initiative was created by the 2010 Small Business Jobs Act. It gives states the ability to design their own matching programs to leverage their state-backed loans and private dollars.

“We are not aware of any state of Wisconsin’s size that doesn’t offer (small business) loans,” said Dan Berglund, director of the Ohio-based State Science and Technology Institute.

“All states except North Dakota and Wyoming participated in the federal government’s State Small Business Credit Initiative,” said Delore Zimmerman of the Praxis Strategy Group in Grand Forks, N.D. However, he added, even North Dakota and Wyoming indirectly take part in the federal initiative through programs managed by coalitions of cities.

Direct loans, participation loans and loan guarantees are among the top five economic development programs in 45 of 50 states, according to the State Business Incentives Database at the Center for Community and Economic Research.

The information was released by the Tech Council as members of the Wisconsin Legislature and Gov. Scott Walker debate the future of state business loan programs operated by the Wisconsin Economic Development Corp., which is the state’s lead economic development agency. A recent state audit criticized some of

WEDC’s fiscal practices but noted improvements in some areas: WEDC’s loan delinquency rate fell from 2.7 percent to 0.2 percent in the year ending Dec. 31, 2014, principal delinquency dropped from 8.8 percent to 1.7 percent, and the balance on uncollectable loans decreased from $5.5 million to $1.3 million. Also, the delinquency rate for annual performance reports by WEDC loan and grant recipients fell from 55 percent in December 2012 to 5.4 percent in December 2014.

The federal State Small Business Credit Initiative allows states to choose from five basic types of programs (four loan programs or a state-run venture capital program), and they customize the rules to suit local market conditions. To date, community banks and mission-oriented lenders are the major participants in the loan programs, in part because they often specialize in serving small businesses that do not fit a traditional credit profile.

States may implement the program through state agencies, quasi-public authorities or private contractors. This allows a state to operate its federal matching program through whatever organizational structure exists in the state with the business lending experience and capacity to execute.

In Wisconsin, the WEDC is a quasi-public agency established by Walker and the Legislature in mid-2011.

Berglund said SSTI has “long believed that whether an (economic development organization) is a state agency or quasi-public is immaterial to its success. It appears to be more about the processes that are in place and the people leading the organization and implementing those processes. It is most important that any of these organizations be set up with transparency – while protecting confidential business information – and accountability in mind.”

BV Tom Still is President of the Wisconsin Technology Council, an independent, non-profit organization that advises state government on policy issues while serving as a catalyst for economic development in various technology and entrepreneurial sectors.

The WMC Foundation is dedicated to building a better future for Wisconsin by providing business and economics education, workforce development initiatives, local chambers of commerce support, safety training programs and business best practices.

Thanks to these Foundation Sponsors for your support throughout 2015 18

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EMERGENCY PR

PREPAREDNESS Are You Ready?

By Mark Crawford

W

hen disaster strikes, do you know what to do? Do you have a thorough emergency preparedness plan in place for responding to a catastrophic event?

Surprisingly, many companies do not.

According to a recent Ad Council survey, nearly two-thirds of small businesses have not developed an emergency plan. And it is not just about business continuity – an emergency plan also creates a safer work environment, where lives could be on the line.

Company leaders often underestimate the threats that can bring down their businesses.

On a statewide scale, Wisconsin’s most recurring threats are natural hazards such as flooding, tornadoes and winter storms.

Wisconsin companies also face manmade threats such as fires and explosions, bioterrorism and infrastructure events such as train derailments and power-grid failures.

Risks to cyber-security, data protection and identity management are also rapidly growing on a global scale.

Smaller-scale problems can still be highly disruptive and damaging to companies – things like power failures. These can result from a variety of causes, depending on the geographic area. “In today’s computerdriven world, both business systems and business equipment can be impacted by blips in power,” says Ron Wegner, loss prevention supervisor for the Large Account Unit for West Bend Mutual Insurance in West Bend (Ron is also the volunteer fire chief for the City of Jefferson Fire Department). “These can be disruptive enough to cause insuredloss situations.”

New Berlin. “However, we had a recovery plan in place to resume operations within hours, resulting in zero customer issues.

Migrating a number of our critical functions to the cloud enables our staff to work offsite if needed.”

Not being prepared can be costly. According to www.ready.gov, a national public service site:

• Up to 40 percent of businesses affected by natural or human-caused disasters never reopen (Source: Insurance Information Institute).

• Downtime due to an emergency can drive “Although contingency customers to competitors for the products or plans don’t need to be services they need. complex, they do need to • Larger businesses want their supply chain be thorough.” partners to be prepared for emergencies – companies that fail to implement a preparedness program may be dropped from the supply chain.

• Insurance is only a partial solution – it does not cover all losses and does not replace lost customers.

• Negative news travels fast, particularly in today’s world of Twitter and other social media sites – rush-tojudgment perceptions by customers and stakeholders can damage sales and erode market share.

“We had a complete power failure due to a construction-related incident,” states Chad Tisonik, president of HNI Risk Services in

Wisconsin Business Voice

21

The Biggest Risks to Business

“Although emergencies such as tornadoes, flooding and winter storms can be devastating, we have well-developed processes for responding to these,” says Major General Donald P. Dunbar, Adjutant General of Wisconsin, who also commands the Wisconsin National Guard and directs emergency management.

“We may struggle with severity, but we know exactly what to do for these types of predictable events. Businesses, however, need to be ready for the unexpected.”

One of the most serious unexpected events is fire. “Fire is the leading cause of business interruption,” says Wegner. “From an insurance perspective, this is the primary issue we always evaluate.”

Eric Sauey, president of Seats Incorporated, knows all too well the devastation a fire can bring. On a bitterly cold night in December 2013, the company’s Richland Center facility, where it manufacturers foam pads for its seating products, caught fire.

Media Preparedness Phil Levin is video production manager at WMC and a former TV news reporter in Madison and Wausau, where he covered many business-related disasters and interviewed company spokespersons who were reluctant to deal with the media.

“Companies need to be prepared and anticipate different types of emergencies, especially the ones that are easiest to predict in their industries,” says Levin. “They need to know who does the media interviews, what to post on social media and what the message will be.

The people who do interviews for media don’t have to be high up in the company – it’s more important they are knowledgeable, well-spoken and charismatic.”

Remember, Levin notes, they can only run what you say. “Don’t be afraid of the tough questions, because fielding them is different than answering them,” he says. “Talk about what you want to talk about.

Be genuine, informed and kind and you’ll be surprised how good you can look, even in an emergency.”

22

The flames started in a dumpster that was outside the building.

By the time the fire was noticed by passing motorists, it had penetrated the building, where it spread to corrugated containers and the plastic/rubber products inside them. The sprinkler system did not work properly and failed to stop the spread of the fire. One wall of the building was destroyed; much of the stored product, machinery and equipment, and raw materials was destroyed or damaged by flames, water, smoke or the cold.

“Production was touch and go for five months while we rebuilt and re-equipped,” says Sauey.

“We were fortunate that we had very good records of our production and accurate inventories so we could be reimbursed by our insurance. Had we not been able to find a source to run our tools, we would have been shut down for five months or longer and lost countless customers and market opportunities.”

The main lesson learned, says Sauey, is to not have uncontrolled storage next to the building. As a result, all dumpsters have been moved away 20 feet or more from the exteriors of all facilities.

Another constant challenge for businesses is the risk of increasingly sophisticated cyber-attacks. Last year, the State of Wisconsin joined the Cyber Hygiene Campaign (sponsored by the Center for Internet Security and Governor’s Homeland Security Advisors Council). The campaign actively promotes the following safeguards to businesses: • Know what’s connected to and running on your network • Implement key security settings to help protect your system • Limit and manage those who have administrative privileges to change, bypass or override security settings • Regularly update all applications, software and operating systems “Every day, there are new attacks on businesses that have impacted millions of customers and cost businesses billions of dollars,” adds Dunbar. “All businesses, large or small, need to secure their data, as well as their customer’s information. Following the campaign’s recommendations is a great way to establish a solid foundation of cyber-security.”

Building a Plan

The Federal Emergency Management Agency (www.fema.gov) and www.ready.gov have plenty of insightful information on how companies can develop plans to protect their business and employees in emergency situations. An integral part of any plan is redundancy of process, especially for information technology and data protection. “It is important to have a clear and consistent way to back up operational information via multiple locations, and know the data can be accessed efficiently because the process has been tested and passed regular verifications,” says Tisonik.

It is also essential to recruit subject matter experts who can help craft an effective emergency preparedness plan. There are many issues that need to be identified and addressed in order to prepare a plan that “meets the needs and expectations of shareholders, the board of directors and the staff of the organization,” says Willie Wills, senior manager for international security and business continuity for Briggs & Stratton Corporation in Wauwatosa.

“Other considerations include regulatory requirements, insurance expectations and industry standards.”

Also be sure to reach out to local and regional fire and EMS departments – they need to be involved so they can understand how to respond the most effectively in case of an emergency.

This knowledge goes much deeper beyond what they gain through periodic inspections of facilities. In fact, police and fire departments encourage companies to work with them when developing an emergency plan, including conducting mock drill exercises. “They can also assist in incorporating community disaster planning into your plan,” says Janie Ritter, director of WMC’s Wisconsin Safety Council. “Many insurance companies also offer risk planning as part of the annual premiums. They are a great resource, especially for smaller and mid-size companies with limited resources.”

Although contingency plans don’t need to be complex, they do need to be thorough. “The better the plan, the better the chance of business recovery after the incident,” says Wegner.

“Sometimes a plan can be too complicated,” adds Wills. “In trying to deal with the stress of a potential incident, it is easy to fall into the trap of preparing complex and very detailed instructions that are hard to follow. These may also be out-of-date or irrelevant by the time they are 'signed off '. Any plan should be fit for purpose and easily understood while under pressure.”

Ready for Action

“History shows you have to bring resources to bear within the first 72 hours of an emergency,” says Dunbar. “Respond with the plan you have built and then adapt to conditions as they happen.”

Once developed, a plan must be regularly exercised and updated to be effective. Plans should be revisited at least once a year, or after any events, incidents or major personnel changes. Dunbar recommends holding a simple tabletop exercise and playing out a scenario based on an emergency. “Discuss what is in the plan and see if that is how you would respond to that emergency,” he says.

“Invite local law enforcement, fire or emergency management staff to the exercise to get their feedback as well. Then, after the exercise, make any changes to the plan that are needed.”

Steve Johnson, factory manager at John Deere in Horicon, recommends revisiting the plan every six months. “Plans should be audited twice a year based on seasonality, once in the summer and once in the winter,” he says. “Each season brings different challenges, such as tornados or blizzard conditions. Through continued auditing we can verify our emergency preparedness plan is effective for our operations and that our employees can act on all required procedures.”

How much a company invests in a preparedness program depends upon several factors.

Regulations establish minimum requirements for readiness – beyond these, companies must determine how much risk they can tolerate, and how to prepare for those risks. According to www.ready.gov, many risks cannot be insured, so a preparedness program may be the only way to manage those risks. Some risks can be reduced by investing in lossprevention programs, protection systems and equipment. An understanding of the likelihood and severity of risk, and the costs to reduce risk, is required to make informed decisions.

Everything associated with incident response should be linked with business continuity, stresses Wills. “Whether at the corporate level, or local or national government levels, everything about preparation/response and recovery is about getting back to normal as rapidly as possible.

Good planning and preparation may lower the risk of some critical events even happening. However, many circumstances are beyond our control.

Therefore, planning an effective response is the best way to ensure we have a home, business and town to return to when the incident is resolved.” BV

Every Emergency Preparedness Plan Should Include . . .

• Resource management – resources for responding to emergencies, continuing business operations and communications • Emergency response plan – includes actions such as evacuation, sheltering in place and lockdown • Crisis communications – system for communicating with employees, customers, news media and stakeholders • Business continuity – includes recovery strategies to overcome the disruption of business • Information technology – recovering computer hardware, connectivity and electronic data to support critical business processes • Employee assistance and support – the business preparedness plan should encourage employees and their families to develop family preparedness plans • Incident management – identifying responsibilities and coordinating activities before, during and following an incident • Training – all employees should be trained so they can take appropriate protective actions during an emergency

Taken from www.ready.gov and provided by Janie Ritter, Director of WMC’s Wisconsin Safety Council.

Crawford is a Madison-based freelance writer.

Wisconsin Business Voice

23

INSURANCE PLANNING Russ Cain Director, Employee Benefits/Group Insurance

Disaster Preparedness A Multi-Faceted Perspective

W

e too often associate disaster preparedness with damage to physical property. This is demonstrated by the regular purchase of automobile and homeowners insurance. Likewise, businesses coordinate their property, casualty and liability insurance coverage into their disaster preparedness strategy.

Again, why the disconnect, and more importantly, how do we solve it?

The Individual Perspective

When insuring against disasters many fail to consider protecting an individual’s most important financial asset – their ability to earn an income. The results of a 2014 Consumer Market Study conducted by the Council for Disability Awareness (CDA) reflect this fact. Survey respondents were asked to identify the three most important “things” in their life versus the most important “things” to protect. The most commonly selected responses were one’s health at 84 percent, followed by income and home, both at 67 percent. Conversely, when asked what is most important to protect, the three most common responses were health, garnering 82 percent, home at 78 percent and car with 73 percent.

While protecting their income ranked fourth, only 28 percent of respondents chose it, begging the question… why such a substantial disconnect?

Couple that with findings from the May 2015 Federal Reserve Board’s Statement which indicates only 53 percent of respondents could cover a hypothetical emergency expense costing $400 without selling something or borrowing money, is disturbing.

Initially, people significantly underestimate their chance of becoming disabled. In a CDA 2013 Employer Disability Awareness Study, 44 percent of employees and 37 percent of HR professionals felt the odds of a worker experiencing an accident or illness that lasts at least three months are just one in 100. But in fact, the odds of a working 20-year-old experiencing a disability in his or her career are actually about one in four and risk factors like obesity and smoking drive those odds even higher.

The Business Perspective

Many people feel the lack of financial education has led individuals to make poor insurance coverage decisions, but is the business community doing much better when making benefit plan selections? The National Compensation Study conducted by the Bureau of Labor Statistics published in March 2014, indicates 57 percent of employers offer group life plans while only 40 percent offer group short term disability and 34 percent offer group long term disability insurance in the workplace. These plan selections are interesting given the odds of becoming disabled far outweigh dying over one’s working lifetime. Some employers feel disability insurance is better left to the individual to purchase, but only 6

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percent of working adults have purchased individual disability coverage.

While the added cost of a disability plan may be difficult for many employers to fund, especially with the increasing cost of health insurance, there are employer/employee contributory plan options Human Resources certainly has an important role to play. When available and there are good voluntary disability options available looking for advice about disability risks and insurance questions, to most employers. Employee participation rates in contributory workers said they turn to their HR person and voluntary plans have substantially increased since the more than any other source. While “The odds of a working economic downturn, indicating employees are starting 72 percent of HR professionals to recognize the inherent risk of disability. in the CDA 2013 Employer 20-year-old experiencing a

Disability Awareness Study the question for the business community disability in his or her career are actually Now felt it was their responsibility is how best to align your employees’ wants and to help employees understand about one in four and risk factors like needs to protect their income with today’s benefit their benefits, only 57 percent plan options to provide income protection in the obesity and smoking drive those odds workplace. agreed HR professionals should provide employees direction or even higher.”

Since 1957, WMC has provided employee benefit recommendations on choosing their plan options and plan administration for its members. Visit benefits. our website or contact me at 800.236.5414 for more information.

The Cost Perspective

Cost is commonly raised as an objection to offering employees disability coverage. The reality is the average cost for group short term disability is $214 per employee per year and $245 per employee per year for group long term disability, versus $209 per employee per year for the average group life plan.

BV

Special thanks to Carol Harnett, President of the Council for Disability Awareness (CDA) and contributing columnist for Human Resource Executive® HREOnline™ e-newsletter for statistics and select content.

The Wisconsin Family Business of the Year awards program celebrated nine deserving companies as winners of this year’s awards.

Grand Award Winners

C. G. Schmidt, Inc., Milwaukee – Large Company Breuer Metal Craftsmen, Beaver Dam – Medium Company Gellings Implement, Inc., Eden – Small Company

Special Award Winners

Kalahari Resorts & Conventions, Wisconsin Dells – “Fire Driven Passion” Milk Source, LLC, Freedom – “Innovation and Sustainability” Moyer’s Landscaping, Stoughton – “Deep Family Roots” Nasonville Dairy, Marshfield – “You Feta Believe” Stan’s Fit for Your Feet, Milwaukee – “Sole of the Family” Yahara Bay Distillers, Inc., Madison – “Spirits of Madison” This awards program is sponsored by Smith & Gesteland, LLP, a Madison-based CPA and business consulting firm, First Business Bank and the Whyte Hirschboeck Dudek law firm. Celebrating its 12th year, the awards program is designed to highlight and celebrate the accomplishments and contributions of family businesses making an impact on their communities and on the Wisconsin economy.

Visit www.familybusinessaward.com for more information about the awards.

Wisconsin Business Voice

25

How Investing in Youth with Disabilities Leads to a Better Bottom Line

T

here is no more important resource for Wisconsin’s economy than our youth. One little-known provision that has achieved significant bi-partisan support in the Legislature is planting the seeds for a unique youth investment that is sure to benefit Wisconsin businesses.

Autumn Rosso and Nathan Reske are two high school students with disabilities from Grafton who visited the Wisconsin Capitol recently with a simple idea: schools should be preparing them for the world of work. As they told their stories of employment success to Representative Rob Brooks (R – Saukville), the freshman legislator had an idea. Why not use their stories to encourage other schools and communities to do the same?

“My Better Bottom Line proposal continues the work started by Gov. Walker to improve employment outcomes for people with disabilities to allow them to contribute to our economy,” says Brooks. “Unfortunately, too many young people with disabilities graduate from high school right to the couch. Parents call this “the cliff ” – after schooling ends, their sons and daughters have not been prepared for a job of any kind. Then they end up relying on public benefits. We can do better.”

Brooks saw that Autumn and Nathan and their teacher Josiah Pledl were doing something right.

Josiah is a transition teacher who spends his day not in the classroom, but pounding the pavement at area Ozaukee County businesses looking for job opportunities for his students. He knows just one work experience for a youth with a disability in high school can double their chances of being employed after they graduate.

Two work experiences means their chances are multiplied by five.

The problem is – school transition programs of this type are often the first to get cut as schools balance their budgets.

Brooks’ Better Bottom Line proposal, which made it into the state biennial budget with a small pot of seed money – $100,000 to start, would offer a $1,000 per pupil incentive payment to a school district that can prove they are preparing their students with disabilities for work or college.

Josiah says $1,000 per student can add-up for a district doing the right thing. “Our hope is that this initiative will grow once people see it can incentivize results and get more kids jobs.”

Under the proposal, schools would be required to report their outcomes for youth one year after their graduation to receive the payment. Students would need to be working or enrolled in a training program or college. In turn, schools can use this incentive payment to improve their transition programs with activities such as purchasing a van for transporting students to jobs, or adding more teachers or paraprofessionals to support job development.

If schools meet this new high bar of performance to receive an incentive payment, all districts across the state would be eligible to draw down funds. We have a long way to go in Wisconsin: For some groups of students with disabilities more than a third report never participating in any further education, training or employment one year out of school. Low employment rates and poverty-level incomes mean significantly higher reliance on programs like Medicaid and FoodShare for adults with disabilities.

“Most Wisconsin school districts do not have the targeted transition programs necessary to connect students with local businesses and teachers receive little training in how to work with the private sector and connect workforce needs,” says Brooks. “Businesses have a role to play in opening their doors to their local school districts and offering those first job experiences to youth.” BV Disability Rights Wisconsin is a private, non-profit organization founded in 1977. The agency helps people across Wisconsin gain access to services and opportunity through its advocacy and legal expertise. Visit www. disabilityrightswi.org to learn more.

Pictured here are Autumn Roso, Josiah Pledl, Nathan Reske and Rep. Brooks at the Capitol in February when garnering support for the bill.

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The Business Friend of the Environment Awards highlight the Wisconsin companies doing great things in the areas of sustainability, innovative technology and environmental stewardship. The goal of this awards program is to demonstrate to state policymakers, businesses and the public that sound environmental practices are good for Wisconsin and its business environment.

Wisconsin Department of Natural Resources Secretary Cathy Stepp was on hand to honor this year’s winners at a luncheon May 21.

Sustainability

Nucor Cold Finish Wisconsin, Inc.

Masters Gallery Foods, Inc.

Oshkosh Defense, LLC

Unimin Corporation Foods, Inc.

Gundersen Health System

Miller Coors, LLC

Phillips Medisize Corp

Environmental Stewardship

Meal on Wheels of Sheboygan County, Inc.

Environmental Innovation

Robinway Dairy LLC

www.wmc.org/bfoe

Wisconsin Business Voice

27

WORKER'S COMPENSATION Chris Reader WMC Director of Health & Human Resources Policy

Innovation in Worker’s Compensation

F

or 104 years, Wisconsin employers have been mandated to participate in the highly regulated Wisconsin Worker’s Compensation program. Despite being mandated by state government, this program has generally been viewed favorably by employers and workers alike for the duration of its existence, and for good reason. The premise of the program, started in 1911, is to ensure workers injured on the job get the medical attention they need, while safeguarding employers from a bombardment of lawsuits stemming from unintentional accidents and injuries in the workplace.

insurance groups and lawmakers.

WMC comprises thousands of businesses from all sectors including payers and medical providers. Because of our diverse membership, we felt implored to develop a new path forward, one that is innovative and could enjoy consensus from the business community – including providers like hospitals. The WMC Board of Directors discussed this issue in January and again in May, and unanimously adopted a compromise proposal. We are now working to gain support for that plan from various medical provider groups,

Throughout summer, WMC will meet with policymakers, medical providers and other concerned parties to develop consensus around the proposal our Board of Directors unanimously approved.

Wisconsin led the nation when it created worker’s compensation in 1911 and we can lead the nation again by adopting this innovative proposal on lowering prices. BV

The proposal is an innovative way forward that harnesses market forces to deliver lower prices in worker’s compensation. Its basis is two main pillars – allowing employers to direct the care of severely injured workers and negotiating discounts with medical providers.

A large difference between group health and worker’s compensation is in group health an employer or insurance company is able to guarantee providers a certain number of patients and in return, Concerned with keeping workers safe and keeping providers offer substantial price discounts. That dynamic isn’t costs down, employers have invested in possible today in worker’s compensation for several “The proposal is safeguarding their workforces over the reasons – mostly because employers aren’t able to an innovative way forward years, and with great success. Since guarantee a large number of patients due to the that harnesses market forces to prohibition under state law for employers to direct 1994, injuries have fallen by 55 percent. deliver lower prices in worker’s care, as well as the inability to estimate the number of During that same time however, medical compensation.” costs have increased dramatically and have workplace injuries an employer might encounter. eroded any cost savings employers might have Here are the highlights of the new proposal: otherwise enjoyed from the reduction in injuries. According to the • It calls for state law to be changed to allow employer-directed latest data available from the state, the medical cost per claim rose care. over 400 percent between 1994 and 2011, more than doubling the • It further creates an appointed council, envisioned to have only overall spending on medical costs despite cases being cut by more a light touch of government, charged with several tasks, most than half. That trajectory concerns many employers for several accomplished through a vendor. reasons and has forced the issue of medical cost containment to the - Collect already available health care price and quality data forefront of the public policy debate in Madison. and make that data available to employers.

Wisconsin employers are currently at an impasse on how we move - Negotiate price discounts with individual medical providers. forward on this issue. On one side are payers into the system Those discounts would be available to employers as they – employers who are required by law to take part in the state make informed decisions based on quality and cost data program but who have little control over the bill they eventually are when directing injured workers to specific providers. required to pay. On the other side are providers, hospitals, doctors, chiropractors, etc. who treat injured workers and do an admirable - Bring 21st century technology into the world of worker’s job getting people healthy and back on the job quickly. compensation to actually cut costs from the system. Items like electronic billing, medical records and electronic Last year an attempt was made to adopt a medical fee schedule. The payments, ubiquitous in other areas of health care, are still fee schedule, which was supported by many employers, organized largely absent from worker’s compensation. labor, and the insurance industry, would have made Wisconsin the There are other parts to the proposal, but those are the big ideas – 45th state to adopt such a policy to address worker’s compensation employer-directed care for costly procedures, delivering meaningful cost concerns. That legislation ultimately did not gain approval from discounts through negotiations and modernizing the worker’s lawmakers, largely due to a strong lobbying effort from medical compensation system with an electronic interface. providers against the proposal.

28

Follow Chris on Twitter @ReaderWMC

Wisconsin’s No. 1 Dental Plan

Wisconsin’s Population If you told an employer Wisconsin would grow by more than 800,000 people over the next 25 years, a 14.2 percent increase, they would see great hope in solving their workforce issues.

And those numbers are true!

Unfortunately, 94.7 percent of that growth (766,000 people) will be over 65 years old.

2010 Census vs. 2040 Projections* Age

# People

Growth

0-17

+ 27,438

+ 2.1%

18-64

+ 15,150

+ 0.4%

65-84

+ 598,121

+ 90.8%

85+

+ 168,205

+ 141.9%

94.7% of the overall growth… is over 65!

Ear-to-ear, a simple smirk, a toothy grin, or that sparkle-inthe-eyes kinda smile. Whatever you call it, you deserve it.

*Source: Applied Population Lab

For individuals, families, small employers, or large, Delta Dental of Wisconsin has a plan for everyone’s pearly whites.

More plan options are another reason Wisconsin employers come to use for their dental benefits. Making the right decision is easy when the choice is obvious.

www.futurewi.org

2015 WMC Golf Outing Friday, August 21 SentryWorld, Stevens Point Register today - www.wmc.org/golf

DeltaDentalWI.com

Reinventing a Wisconsin Family Business It is a story right out of today’s start-up success blogs.

Entrepreneur identifies opportunity. Entrepreneur develops technology in a garage. He knocks on hundreds of doors to gain acceptance. Wins Governor’s New Product Award. Secures key client. Grows business to multi-million dollar success.

That is the story of Berntsen International Inc. … In 1972. That is when Phil Peterson and Peter Berntsen got together to develop a more durable survey marker for the Wisconsin Department of Transportation. Since that time, Berntsen International has grown to become the ‘go to’ supplier for surveyors in North America with products in 90 countries marking heights and boundaries from the top of Mount McKinley to the depths of Death Valley.

The company is not resting on its success. Today, Berntsen is reinventing itself under the guidance of Rhonda Rushing - Phil’s daughter and Berntsen President - even while it continues to maintain its leadership in the surveying industry. While other owners might be planning their retirement, Rhonda and her husband Bill Rushing are investing in geospatial software and ‘smart’ technology. Their new InfraMarker™ line couples RFID technology with smartphone software to reduce the time and risk of locating underground infrastructure such as gas lines, fiber-optic cables, and water laterals. Bill Rushing, VP of Product Development, states it this way, “We recognized a long time ago our markers were going to have to communicate information as well as mark a spot. We were already anticipating the need to be an Internet of Things provider before we knew what IOT meant.”

But transitioning from a traditional manufacturer to a next generation firm is easier to say than execute. It is true existing businesses have advantages such as brand recognition, an established customer base and

Governor’s New Product Award. Phil Peterson and Peter Berntsen accepting award from Governor Lucey, 1975.

Berntsen monument product line

30

Dane County Business Award 2014. From left; Mike Klonsinski, Director of Business Development; Rhonda Rushing, President; Bill Rushing, Vice President; Troy Balling, General Manager.

cash flow. But they also have added challenges such as running the day-to-day business while developing new products and maintaining a brand loyalty with existing customers while developing new markets. The greatest challenge is often simply bringing new methods and ideas to a company used to operating one way.

“It is not as easy to drive change without a burning platform. But we want to anticipate the future and evolve the company on our terms rather than wait for a crisis to force our hand,” says Rhonda.

From left to right: 1. Wisconsin State Capital marker, located in the State Capital 2. Las Vegas marker, installed in the Vegas Strip 3.The Disney Resort Marker, installed in Disney World Orlando, FL. 4. King Airport marker, Saudi Arabia.

To accomplish that, Berntsen added a Business Director who had experience with organization change and a sales manager with experience in their new target markets. They set-up partnerships with technology organizations such as Solomo of Madison, ESRI and the Auburn University Geo-spatial Research Center.

The company contracted with a marketing firm to build a plan evolving the Berntsen brand so the trusted reliability for which Berntsen is known can co-exist with the message of being a technology leader. The family has increased its annual investment in R&D to ensure it stays out front in this rapidly changing industry.

It’s a big commitment of money, time and energy for a second generation family manufacturer. And the obvious question to Rhonda is ‘why?’

“My father started a company 43 years ago that has been good for us, our employees, our customers and our community. I want to make sure Berntsen International will thrive and provide those benefits for another 43 years. That’s what we are supposed to do, right?” BV

InfraMarker reader and utility post with RFID tag.

Wisconsin Business Voice

31

Chapter of

Safety Training July - December 2015

The Wisconsin Safety Council, a division of WMC, is Wisconsin's leading provider of safety training and programming. WSC offers training throughout the year at locations across the state.

www.wisafetycouncil.org MILWAUKEE AREA SAFETY TRAINING

October 13

August 4-5

DOT Hazmat Transportation Refresher (PM)

OSHA 10-Hour Voluntary Compliance for General Industry

August 25

Creating a World Class Safety Culture

September 17

Effective Team Safety

October 15

Safety Inspections

October 28

Coaching the Lift Truck Operator, Train-the-Trainer

December 1-4

OSHA 30-Hour Voluntary Compliance for General Industry

Register today www.wisafetycouncil.org

RCRA Compliance for Hazardous Waste Generators Overview (AM)

October 19-22

Safety Management Techniques (SMT)

October 23

Incident Investigation: A Root Cause Analysis

October 29

Coaching the Lift Truck Operator, Train-the-Trainer

November 2

Supervisor Development: Safety & Health Fundamentals

November 12

Selection and Proper Use of Fall Arrest Equipment

MADISON AREA SAFETY TRAINING

November 16

July 14

December 14

July 21

FOX VALLEY/GREEN BAY AREA SAFETY TRAINING

Hazard Communication, Trainthe-Trainer Safety Inspections

August 3-5

Instructor Development Course (IDC): First Aid/CPE/AED

August 10-13

Principles of Occupational Safety & Health (POSH)

August 19

Coaching the Emergency Vehicle Operator (CEVO): Ambulance and Fire

September 21-24

OSHA 30-Hour Voluntary Compliance for General Industry

September 28

Confined Space, Train-the-Trainer (AM) Lockout/Tagout, Train-the-Trainer (PM)

October 12

Job Hazard Analysis ( JHA)

Safety Communication & Training Techniques Effective Team Safety

October 7

Autumn Safety on the Lakeshore Conference & Expo

October 17-18

OSHA 10-Hour Voluntary Compliance for General Industry

WAUSAU/STEVENS POINT/MARSHFIELD AREA SAFETY TRAINING August 20

Coaching the Lift Truck Operator, Train-the-Trainer

Awards

2014

Wisconsin Corporate Safety Celebrating Safety in Wisconsin

21st Annual Corporate Safety Award Winners

www.wisafetycouncil.org

Application Deadline for Business Achievement Award is August 1 A s a way to celebrate and promote free enterprise, the Stoughton-based Flowers Family Foundation will once again present the annual Wisconsin Business Achievement Award at WMC’s State of Wisconsin Business Luncheon on October 20.

The award, which includes a $60,000 donation to a Wisconsinbased non-profit organization of the winner’s choosing, will honor an individual or entity that has had a positive impact on the Wisconsin economy.

“The purpose is to recognize the winner’s role in support of the Wisconsin economy, hoping that it will encourage others,” explained Rockne “Rock” Flowers, Secretary and Treasurer of the Flowers Family Foundation and past WMC Chairman (1982-84).

He said the award honors activities such as exporting, innovation, entrepreneurship, education, or other similar initiatives.

Nomination application forms were mailed this May to local chambers of commerce and banks across Wisconsin, and are available by calling (608) 873-4378. Nominations will close August 1.

Winners will be chosen by a panel consisting of WMC’s Kurt Bauer, University of Wisconsin System designee Mike Falbo and The Wall Street Journal’s Senior Editorial Page Writer Collin Levy.

Last year’s Flowers Family Foundation Award winner was Kapco Inc., a Grafton-based family-run metal stamping company. They bestowed the cash award to Hometown Heroes, a non-profit organization offering community support to neighbors in need, including veterans and first responders. KAPCO was recently recognized by "The FABRICATOR®" magazine's annual FAB 40 survey as 4th most successful metal fabricating companies in the United States.

WMC State of Wisconsin Business Luncheon Tuesday, October 20 Monona Terrace Community & Convention Center, Madison Sponsorships available

Register today

www.wmc.org/sowb

34

WMC Videos

Episode 4: Right to Work is already adding Wisconsin jobs Right to Work is working in Michigan “The most critical part of the fallout has been there really hasn’t been one.”

“They said ‘because you passed this bill, we’re going to move one of our companies from Minnesota to Wisconsin.’”

- Rep. Chris Kapenga (R-Delafield)

- Jim Holcomb, Michigan Chamber of Commerce Senior VP

WMC's Public Policy Center: Stay informed. Stay active.

Episode 9: Wisconsin sues the EPA over job-killing emissions rules

“I’m concerned because we need to fill the jobs we currently have.”

“This has the potential to really damage Wisconsin’s job atmosphere.”

- Kate Schieldt, Stoughton Trailers VP of Human Resources

WMC’s Two Minute Drill series captured the details of the budget process this spring. Stay tuned later this summer for Two Minute Extras, a new series focusing on WMC’s programs and issue areas.

- Wisconsin Attorney General Brad Schimel

Watch all episodes online: www.wmc.org/2min

Business Day in Madison 2015 highlights “Now EPA should stand for ‘enough protection already’” - John Stossel, Fox Business Network Host YouTube WMC501

Episode 13: Wisconsin dairies forced to invest elsewhere “The murmur in the room is ‘Wisconsin is becoming too difficult to do business.”

- Jim Ostrom, Milksource President, CEO and Co-Founder

STAY CONNECTED All WMC members are eligible to receive these communications.

Make sure you are receiving everything you want to receive.

WMC Morning Digest The WMC Morning Digest gathers headlines from around Wisconsin, the nation and the world including a special area highlighting HR issues that could impact your business.

rk is already adding Wisconsin jobs

passed this bill, we’re going to move om Minnesota to Wisconsin.’”

Concise information to start your day.

- Rep. Chris Kapenga (R-Delafield)

Other WMC Communications Wisconsin Business Voice magazine Capitol Watch e-update Safety Zone e-Newsletter Workforce Development e-Newsletter Members Only Legislative Briefing Webinar

sues the EPA over job-killing

Information pertaining to you.

really damage Wisconsin’s job

Wisconsin Attorney General Brad Schimel

n dairies forced to invest

m is ‘Wisconsin is becoming too

lksource President, CEO and Co-Founder

Interest Areas:

 Civil Justice  Energy  Environment  Health Care  Human Resources

 Taxes  Transportation  Worker’s Compensation  Event Notices

Contact WMC's membership team to sign up for these free communications. mem@wmc.org (608) 258-3400

Defending Your Legal Rights WMC in the Courts

By James Buchen

W

MC is well known for its effective advocacy work representing the business community in the state legislature and before state agencies. From tax cuts to labor law and legal reform, WMC’s success in that arena is unparalleled. Lesser known is WMC’s advocacy work representing the business community in State and Federal courts. In this arena WMC’s legal advocacy efforts have helped establish important precedents in areas ranging from the free speech rights of business to limitations on the regulatory authority of state agencies.

Under the direction of the Corporate Counsel Committee and the WMC Board of Directors, WMC looks for cases involving significant issues of first impression that could have broad implications for the business community. From there, WMC either joins the case as a full party or files amicus curiae (friend of the court) briefs advocating the business perspective on the issues at hand. In this effort WMC often partners with the Great Lakes Legal Foundation as well as other organizations which have a similar position on the matter. Over the years WMC has racked up an impressive list of successes. Some of the most important recent cases include: Regulatory Authority – The business community has become increasingly concerned about the impact of excessive regulation on the economy of our state and nation. In response, WMC spearheaded a regulatory reform initiative aimed at limiting the scope of state agency authority to those areas where there is “explicit” statutory direction from the state legislature. Since the passage of the new law (2013 Wis. Act 21) a number of cases have arisen that interpret agency authority under the new limitation. In Rock-Koshkonong Lake District v. DNR, WMC sought to limit the regulatory authority of the DNR under the “public trust doctrine” to the ordinary high water mark of a body of water. The Wisconsin Supreme Court agreed, taking the first step towards placing proper limitations on the DNR’s authority to regulate private property under the “public trust doctrine.”

In the case of New Chester Dairy v. DNR, WMC intervened arguing the agency lacked “explicit” statutory authority to require

monitoring wells as a condition for granting a permit for a high capacity well.

With these cases WMC is beginning to establish “explicit” legislative direction as the only legal foundation for agency regulatory authority.

Officer Liability – There have been a number of cases recently dealing with the personal responsibility of corporate officers and directors. The case of Data Key Partners v. Terrance Paul, involved a shareholder lawsuit challenging the board’s decision regarding the sale of the company. WMC argued that the board’s decision should be governed by the business judgement rule, which recognizes that boards, rather than individual shareholders or the courts, are best positioned to make complex business decisions. The Wisconsin Supreme Court agreed, ruling that in the absence of specific factual allegations of bad faith or a breach of the duty of loyalty, a claim challenging a merger or acquisition transaction based on an alleged breach of fiduciary duty cannot be maintained.

Non-compete Covenants – In the case of Runzheimer International v. David Friedlen, the Wisconsin Supreme Court was asked to decide what constitutes “legal consideration” in exchange for agreeing to a restrictive covenant not to compete. The facts involved a 15-year employee who was asked to sign a non-compete covenant in order to continue his employment with the company.

WMC argued that the offer to continue at-will employment was adequate “consideration” to make the covenant enforceable.

The court agreed saying “an employer’s forbearance in exercising its right to terminate an at-will employee constitutes lawful consideration for signing a restrictive covenant.”

These are just a few examples of WMC’s ongoing effort to address legal issues of statewide importance to the business community.

For more information on WMC’s legal advocacy efforts visit www. wmc.org or contact WMC’s Jason Culotta. BV

James Buchen is a consultant to WMC on legal and legislative matters and serves as Chairman of the Great Lakes Legal Foundation.

Wisconsin Business Voice

37

Trade Prom We Should Oppose the Fast-track Proposal for TPP

By Rep. Mark Pocan (D – Madison)

T

he United States’ trade policy should be to help American businesses, big and small, succeed and create good jobs here at home.

Unfortunately, the Trans-Pacific Partnership (TPP) trade agreement, the biggest trade deal since NAFTA, opens the floodgates to sending more jobs overseas and threatens the bottom line of small businesses.

As the owner of a small printing business for nearly 30 years, I have seen the impact of bad trade deals on America’s small businesses. It’s become harder and harder to find products made in America. The loss of each American-made product represents more families struggling to get by and fewer customers who support local businesses.

Supporters of these trade agreements always make the same promises; more jobs, bigger paychecks and a stronger economy. However, the Economic Policy Institute reports the U.S. lost three times as many jobs as we were assured NAFTA would create, with millions of good-paying American jobs shipped off to countries like China and Mexico, and wages for American workers have remained flat. The TPP will send even more American manufacturing jobs to countries like Vietnam or Malaysia where workers earn a minimum wage of pocket change – not helpful to growing the economy here in the United States.

And now we’re hearing the same broken promises again. Top administration officials have said the TPP would “provide $77 billion a year in real income and support 650,000 new jobs in the U.S. alone.” This claim is blatantly false and misleading. A fact-check by the Washington Post rated this “four Pinocchios” saying, “In this case, the correct number is zero (in the long run), not 650,000.”

The TPP also puts the interests of foreign investors ahead of our national sovereignty with the inclusion of Investor-State Dispute Settlement (ISDS) provisions. These ISDS provisions are a Pandora’s Box for American small businesses, allowing multi-national corporations to sue a country if they feel laws which protect American consumers or businesses would hurt 38

their bottom line – putting U.S. taxpayers on the hook for the potential lost profits.

While supporters of the Trans-Pacific Partnership have admitted the failures of past trade agreements, they are promising the TPP will be different this time around.

Proponents say the TPP is a “21st century trade agreement” and will correct the mistakes made in NAFTA – but mainstreet businesses will have to take their word for it since the entire agreement has been negotiated in secret.

And with so much of the agreement still unknown – the Obama administration is now trying to put TPP on a fasttrack through Congress. That means Congress would have to give its constitutional authority to the president and would only have a take it or leave it deal. Even further complicating this situation is that Congress would give up its constitutional authority for the next six years. This means trade deals which have not even been imagined could pass Congress with just an up or down vote. And not only this president, but the next president and possibly the president after that would have this power.

This should make everyone suspicious. If it’s such a great deal why is it a secret and why does it need to be fast-tracked through Congress?

The TPP will have a major impact on tens of millions of American jobs and our economy. Instead of rushing to get it done fast, President Obama and U.S. Trade Representative Michael Froman should focus on getting it right, not just fast.

All of us in South Central Wisconsin understand the impact of failed trade agreements. We’ve seen closed factories, shuttered stores and lost jobs in our communities. Despite promises this time will be different, until we can ensure the TPP will help benefit all Americans, I will oppose the fasttrack proposal for TPP. BV Congressman Pocan represents Wisconsin’s 2nd Congressional District.

omotion Authority

*

Trade is Good for American Workers and Our Economy

By Rep. Paul Ryan (R – Janesville)

L

ast week, Congress took a step toward rebuilding America’s credibility on the world stage. With a bipartisan vote, the House passed what’s known as trade promotion authority, or TPA, a process that puts Congress in charge of how America negotiates trade agreements. Instead of the president negotiating a trade deal in secret, TPA restores transparency and accountability by establishing negotiating objectives for new agreements. And it requires the text of an agreement be made public before ever coming to Congress for a vote.

TPA tells the president, “If you’re going to negotiate a trade agreement, it’s got to be on our terms.”

TPA isn’t out of the clear just yet. There’s still work to be done in order for it to become law. But with the recent debate over TPA, it’s easy to lose focus of why all of this is so important.

Wisconsin is a manufacturing state. Per capita, no state has more workers in manufacturing than Wisconsin. But if we want to maintain a healthy manufacturing sector, our businesses need to be able to sell more products so they can grow and hire more workers.

Here’s the issue. Ninety-five percent of the world’s consumers don’t live in America – they live in other countries. If we want to grow, we can’t just keep selling to ourselves. We need access to these new customers. We need to open up markets to our products so we can make more things here and sell them overseas. And the only way to do it is with new trade agreements.

market share and freezing America out. Since 2000, there have been 48 trade agreements in Asia. Yet America has only been a party to two of them. As a result, our share of exports to that region has gone down 42 percent. In fact, there are now 262 free-trade agreements in force all over the world. The U.S. is party to only 14.

And if we don’t engage in trade and negotiate agreements that force other countries to play by our rules and rise to our standards, then China will step in and take our place. If we leave it up to China to write the rules of the global economy, instead of America and her allies, it won’t be in the best interests of Wisconsin manufacturers.

To put it plainly: If we’re standing still on trade, we’re losing.

This is why passing TPA was so important. It sends a message to the rest of the world America is serious about leading on trade. It lets our trading partners know instead of having to rely on their hostile neighbors, like China and Russia, they can rely on the U.S. And, most importantly, it paves the way for new trade agreements that will help grow our economy and create good-paying jobs for Wisconsinites.

The stakes are too high for America to do nothing. Getting TPA signed into law is the first step. Then it’s time to stand up for American workers and get the best trade agreements possible. BV Congressman Ryan represents Wisconsin's 1st Congressional District.

In this 21st century global economy, if we don’t act on trade, we’ll fall behind. Other nations are going around the world and securing trade agreements for themselves, taking up

*This issue continues to move forward. These columns were submitted mid-June.

Wisconsin Business Voice

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CHAMBER CORNER

A Hotbed of Opportunity: Fond du Lac Works!

By Melissa Worthington

W

hat's next? This is a question most businesses, regardless of industry or geography, face on a daily basis. Of course, the next question is are we ready? And after that what's our plan? Next up, who's in charge? The list is certainly long and most definitely daunting; however, it's business. This is exactly what business leaders are expected to do. So what happens when these questions are asked of an entire community? Well, in the case of Fond du Lac, the scenario is still playing out and the results are nothing short of amazing.

Professional research of the Fond du Lac area workforce consistently demonstrates a shift in demographics, which places the entire community in an immediate and critical situation; there will simply not be enough skilled workers to fill available jobs in the future without aggressive solutions being developed and implemented now.

After determining Fond du Lac was not ready, community leadership immediately got to work developing a plan and identifying solutions.

Under the direction of the Fond du Lac Area Association of Commerce, a community initiative quickly morphed into a strategic entity dedicated to bolstering Fond du Lac through the recruitment, retention and development of a quality workforce. Known as Fond du Lac Works, this unique solution was developed and launched – and in less than six months is already sparking interest and impacting change.

The cornerstone of Fond du Lac Works is an online platform that showcases the Fond du Lac area and speaks to current and prospective community members like never before. A multifaceted online resource, www.fdlworks.com has something for everyone.

Fond du Lac Works developed an extensive one-stop shopping experience for job seekers both within and outside of the community.

The site automatically pulls together positions posted from large companies and provides smaller companies with the ability to manually enter vacancies. Job postings, along with information on all

CHAMBER FUN FACT Platteville

As one approaches this town of 11,000 in the southwest corner of Wisconsin, the largest letter M in the world looms to the north. Made of 400 tons of whitewashed limestone, measuring more than 200 feet in each direction and symbolizing the University of WisconsinPlatteville’s mining tradition, it is peaked on the kind of hill not ordinarily seen in the northern Midwest.

40

aspects of the community, are helping to draw positive attention to Fond du Lac.

The site also provides valuable information for business partners – best practices ranging from wages and benefits to how to engage millennials are available online. Additionally, Fond du Lac Works is proud to offer significant support to local businesses and their recruiting efforts by way of a concierge service. This service supports businesses through special welcome gifts with a local flair, familiarization tours, job search support for trailing spouses and mentorships with community families to help with assimilation to the community.

Another key component of Fond du Lac Works is its ability to speak to a variety of audiences including high school students, teachers and parents. Tools available include labor market data to guide career planning, information on which classes students should take based on career interests, which post-secondary institutions offer credentials in areas of interest and more to help navigate planning for the future.

Lastly, the site also offers tailored information for retirees; whether working in a part-time capacity in an area of expertise or going in to a new field all together, retirees can be strategic pieces of the employee mix.

While all of these services are critical to the success of Fond du Lac, Fond du Lac Works is far more than an online resource. As a division of the Fond du Lac Area Association of Commerce, Fond du Lac Works is engaged in numerous programs that serve and support K-12 education and local businesses including the Youth Apprenticeship program which provides high school students with worksite learning in an area of career interest along with classroom instruction. Project-based learning programs are also offered through Fond du Lac Works; at the high school level through Project G.R.I.L.L., which connects local manufacturers with high school tech-ed students on a year-long project to design and build a charcoal grill from scratch; and at the elementary level through Lemonade Day, which introduces elementary students to entrepreneurship through the real world experience of starting their own business – a lemonade stand. Additionally, Fond du Lac Works regularly engages with and connects business and education partners though Business After School; Business, Industry and Education Day; and more.

Fond du Lac Works means Fond du Lac can work for you. A community initiative led by forward thinking business leaders, Fond du Lac Works is creating a bright future for the Fond du Lac community. Interested in getting more information on how we made this happen? Visit www.fdlworks.com or call (920) 921-9500. BV Melissa Worthington is vice president of the Fond du Lac Area Association of Commerce.

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