CONNECT » GUIDE » INSPIRE
NOVEMBER // DECEMBER 2019
From left: Thomas Connelly, Dave Ralston, Candace Hunter Wiest, Don H. Garner, Danielle Puente
THE MONEY ISSUE
$4.95
The banking trends to watch in 2020
HOLIDAY CATERING
36
Meet the finalists for CFO of the Year
CFO OF THE YEAR AWARDS
46
Here’s where to invest your money in 2020
ARIZONA BANKERS ASSOCIATION
89
ARIZONA FORWARD
105
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Table of Contents 6
Trendsetters
12
CEO Series
14
Missing Piece
16
Law
20
Healthcare
24
Mining
WE SHOULD ALL BE THANKFUL FOR ARIZONA FORWARD
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28 Arizona Energy Consortium Marketing
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34 Dining 36 Holiday Party Catering 40 Holiday Party Venues 46 CFO of the Year
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79 Wealth Management 89 Arizona Bankers Association 105 Arizona Forward CONNECT » GUIDE » INSPIRE
NOVEMBER // DECEMBER 2019
It’s been 20 years since I moved to Arizona from Upstate New York. I drove to Phoenix in a car that didn’t have air conditioning because we didn’t really need that in the Finger Lakes. That car was soon history — but not soon enough because it wasn’t exactly easy selling a car with no AC in the Valley. Beyond the car, there were a lot of other things I wasn’t prepared for in Arizona. But the thing that struck me the most — and was most unprepared to handle — was the majesty of the state. I’m a runner and triathlete, so the wide open spaces, the trails, the canals, the lakes are like heaven on Earth for me. And I have Arizona Forward to thank for fighting to maintain and preserve our state’s majesty and splendor. For 50 years, Arizona Forward has been an advocate for a balance between economic development and environmental quality. The organization convenes business, community and civic leaders in thoughtful dialogue on critical sustainability issues and the organization mobilizes the state’s business leaders and policymakers to leverage their collective power to influence how we best grow our communities, stimulate our economy and enhance our environment. Inside this issue of Az Business magazine, we celebrate Arizona Forward and its 50 years of impact. We look at some of the milestones in the organization’s first half-century and look at how it’s preparing the next generation of environmental stewards. Enjoy this issue of Az Business magazine. And next time you’re on a trail or at the lake and say to yourself, “Wow,” follow that up with, “Thank you, Arizona Forward.”
On the cover:
THE MONEY ISSUE $4.95
The banking trends to watch in 2020
2
HOLIDAY CATERING
36
Meet the finalists for CFO of the Year
CFO OF THE YEAR AWARDS
46
Here’s where to invest your money in 2020
ARIZONA BANKERS ASSOCIATION
89
ARIZONA FORWARD
105
From left: Thomas Connelly, president and chief investment officer, Versant Capital Management; Dave Ralston, CEO, BOK Financial; Candace Hunter Wiest, president and CEO, West Valley National Bank; Don H. Garner, CEO, Alliance Bank of Arizona; and Danielle Puente, CFO, DP Electric.
AB | November - December 2019
Michael Gossie Editor in chief michael.gossie@azbigmedia.com
SHOUT-OUTS
VALLEY VISIONARY BUILDS HOPE FOR NEUROMUSCULAR INJURY PATIENTS After sustaining a life-changing spinal cord injury, Daniel Campbell became a game-changer for neuromuscular injury patients. Campbell, president of Chandler-based ReneGait, invented the Spartan, an assistive gait-training tool aimed at transforming the lives of patients who live with a spinal cord injury, multiple sclerosis, traumatic brain injury or have suffered from a stroke. Daniel Campbell The Spartan allows the participant to achieve a cyclical stepping motion with little to no risk of falling. Using external, internal and reaction forces, the Spartan helps strengthen atrophied muscles and delivers neuromuscular re-education. “My rehabilitation faltered when I lacked the tools I needed to improve,” Campbell says. “But I used my challenges and rehab experiences to craft the ideal mechanism to facilitate recovery.”
Kate Gallego
Literary Artist Award: Joel Salcido
Innovative Arts Organization Award: Girls Rock! Phoenix
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OFFICE Special projects manager: Sara Fregapane Executive assistant: Brianna Villa Database solutions manager: Amanda Bruno
HOME & DESIGN
Young Artist Award: Ruchi Ukhade
Dr. Eugene Grigsby Visual Artist Award: Maggie Keane
MARKETING/EVENTS Marketing & events manager: Keith Chandler Digital strategy manager: Gloria Del Grosso Marketing designer: Michael Bodnar
AZ BUSINESS LEADERS Director of sales: Sheri Brown
Dance Artist Award: Susan Bendix
Theatre Artist Award: Bobb Cooper
ART Design director: Bruce Andersen Art director: Mike Mertes
AZ BUSINESS ANGELS
THE 2019 MAYOR’S ARTS AWARDS WINNERS WERE:
Jerry Lawson Memorial Music Artist Award: Downtown Chamber Series
EDITORIAL Editor in chief: Michael Gossie Associate editors: Steve Burks | Alyssa Tufts Intern: Angelica Olivas Contributing writers: Sierra Ciaramella | Michelle De Blasi Victoria Harker | Erin Thorburn | Jackie Wright | Steven G. Zylstra
AZ BUSINESS MAGAZINE Senior account manager: David Harken Account managers: April Rice | Kim Bailey
MAYOR’S ARTS AWARDS CELEBRATES INNOVATION AND CREATIVITY Phoenix Mayor Kate Gallego celebrated creativity with the Eighth Annual Mayor’s Arts Awards. The annual event highlights the vast spectrum and quality of artistic talent in the city, while also raising funds for Phoenix Center for the Arts.
President and CEO: Michael Atkinson Publisher: Josh Schimmels Vice president of operations: Audrey Webb
DIY/Maker Award: Tina Ferguson Lou & Evelyn Grubb Community Innovator Award: RJ Muller
AZRE | ARIZONA COMMERCIAL REAL ESTATE Director of sales: Ann McSherry Director of business development: Carol Shepard EXPERIENCE ARIZONA | PLAY BALL Director of sales: Jennifer Swanton RANKING ARIZONA Director of sales: Sheri King Az Business magazine is published bi-monthly by AZ BIG Media, 3101 N. Central Ave. Suite 1070, Phoenix, Arizona 85012, (602) 277-6045. The publisher accepts no responsibility for unsolicited manuscripts, photographs or artwork. Submissions will not be returned unless accompanied by a SASE. Single copy price $4.95. Bulk rates available. Copyright 2017 by AZ BIG Media. All rights reserved. No part of this publication can be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from AZ BIG Media.
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TRENDSETTERS ap op s
d le a
ss in e
b us
y ilit
Valley
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a child a bonus, and approve when a child wants to spend, share, save or invest their money. Gregg Murset, vice president of employee benefits at Bennett & Porter and co-founder and CEO of BusyKid, describes the app as your kid’s first job with direct deposit. “Personal financial literacy is not really taught in schools,” he says, “so a tool like BusyKid can open up the conversation between parents and children in a practical way because it facilitates learning by doing.”
Gre
PL AY
cia
l re Leave sp d on it to a Certified er Financial Planner to develop BusyKid, an app that helps kids learn financial literacy and keeps them accountable by finishing chores and earning an allowance. Parents can add or edit chores, send el ev
gg
C H I LD’ S
p to t each kids finan
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et
What job seekers don’t want you to see on their social media How worried are job seekers that their digital footprint will jeopardize their career opportunities? According to research by JDP, most are taking steps to hide their social media from current and future employers. The study found 82 percent enable privacy settings, while almost half create alias accounts. Other highlights:
• 56 percent say they’re trying to hide unprofessional behavior • Nearly half feel they need to hide their followers or likes • 43 percent have privacy settings to avoid coworkers and 1 in 3 refuse to connect after accepting a job
6 METRO PHOENIX CITIES RANK IN TOP 15 FOR BUYING A HOME In a new study, SmartAsset crunched the numbers to find the best U.S. cities to buy a family home, and six cities in the Phoenix metro area rank in the nation’s top 15. The six cities include Chandler, ranked third; Gilbert, ranked fourth; Mesa, ranked sixth; Glendale, ranked seventh; Scottsdale, ranked ninth; and Phoenix itself, ranked 15th. All of these Arizona cities rank within the 20-lowest rates in the study for property tax, with Scottsdale providing the lowest effective rate among them. 6
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Blue Cross Blue Shield of Arizona helps revitalize Hance Park Dedicated to giving back to the community and supporting programs that help to improve the health and quality of life for Arizonans, Blue Cross Blue Shield of Arizona has partnered with the Fiesta Bowl to support the Margaret T. Hance Park Revitalization Project. This effort will bring a new, 20,000-squarefoot playground to the space including a small rock-climbing slope, shade structures, swings and a splash pad. The park in its current state is underutilized and the new addition will attract hundreds of thousands of Arizonans to enjoy fun and healthy activity in the heart of the city. The partnership is part of BCBSAZ’s commitment to inspire Arizonans to get healthier faster and stay healthier longer.
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TRENDSETTERS
With the ho lidays appro aching, people will be turning their attenti toward tr yi on ng to find th e gre gif ts for the ones we love atest . But if you ask som e of Arizon a’s most prominent business le aders abou their most t prized poss essions, yo learn it’s no u’ll t the cost o f the gif t th creates the at most value.
Bridget Olesiewicz,
PRINCIPAL, VANGUARD: “A bracelet my mother gave to me with an everlasting love symbol. It’s a reminder of a great role model in my life.”
Adriana Kong Romero, TUCSON MARKET PRESIDENT, BANK OF AMERICA: “My teddy bear, Bubu, named by my late uncle, was given to me by my godmother when I was 3 and outfitted with clothes knitted by my grandmother. Bubu is a companion and a reminder of the individuals who were important and made an impact in my life.”
CHARLES TOUCHÉ,
CEO AND CHAIRMAN, LOVITT & TOUCHÉ: “I wear my father’s gold Rolex every day. He gave it to me before he passed away, and I’ve worn it ever since. It reminds me of his work ethic and my responsibility to carry on his legacy through sound business practices and an earnest commitment to doing what’s right at all times.”
Gena L. Sluga,
Stephanie J. Quincy, PARTNER, QUARLES & BRADY: “My Dad bought me a necklace shortly before he died. It isn’t worth much monetarily. It is worth everything to me and I keep it with me all the time.” 8
SHAREHOLDER, CHRISTIAN DICHTER & SLUGA: “A framed calligraphy piece that was a gift from my colleagues and hangs in my office. It reads, ‘Bad Things Happen When You Don’t Listen to Gena.’”
RANDY NUSSBAUM, SHAREHOLDER, SACKS TIERNEY:
“When I was first dating my wife, she commissioned a young artist to sculpt an original piece for my birthday gift. She had little money when she bought this gift for me. Because she was willing to sacrifice so much at that time, I knew she was the person I would one day marry.”
AB | November - December 2019
JOSEPH T. CLEES,
SHAREHOLDER, OGLETREE DEAKINS: “I carry a small peace medallion my beloved son gave to me years ago after we won it at our favorite arcade in Redondo Beach. It reminds me of him and our life together.”
D. LEWIS CLARK JR.,
PARTNER, SQUIRE PATTON BOGGS: “My six-string Fender acoustic guitar. My parents bought it for me in the early 80’s, and I still play it today.”
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TRENDSETTERS Who are Arizona’s
Manufacturers of the Year?
WAYS artificial intelligence is changing the workplace
Artificial Intelligence (AI) is becoming more prevalent in all parts of our daily lives. From our everyday digital assistants, such as Siri and Alexa, and our Facebook feed using AI to deliver the most relevant posts, to cars that use AI to aid with safety and even Netflix using AI to provide lists of the movies and shows we might be most interested in viewing. One area where AI is having a rapidly increasing presence is in the workplace. Here are five ways AI is changing the workplace, according to AppZen: • THE HIRING PROCESS: New AI tools allow companies to better analyze prospective employees’ previous experience, credentials and background, so that hiring managers and HR teams are presented with the best possible matches for job openings. • REDUCING FINANCIAL FRAUD AND ERRORS: Apps deliver tools for organizations to use AI to audit 100 percent of a company’s spending, reduce travel and entertainment cost fraud, double-check that invoices match the contract terms, catch double payments and audit payments before they go out. • COMMUNICATION: Recently introduced AI tools are enabling employees to ask for what they might need over email, the web, Slack, etc. and have the systems immediately respond with an appropriate response. The availability of this type of AI-powered tool allows employees — such as those in the IT and accounting departments — to stay focused on their tasks and not spend additional time responding to common requests.
The manufacturing sector contributes $47.3 billion to Arizona’s GDP each year and provides jobs for 179,000 people at more than 5,000 establishments. The Arizona Manufacturers Council honored some of those economic engines at the Manufacturers of the Year awards. These were this year’s award recipients: • Advocate of the Year: David Garafano, executive director, Arizona Manufacturing Extension Partnership • Legislator of the Year: Rep. Joanne Osborne (LD-13) and Rep. Jeff Weninger (LD-17) • Excellence in Innovation: InsulTech • Excellence in Sustainability: SenesTech Inc. • Small Manufacturer of the Year: Interface • Medium Manufacturer of the Year: Cassavant Machining • Large Manufacturer of the Year: Benchmark Electronics
Which Arizona company packs the economic impact of 5 Super Bowls? Raytheon Company makes a $2.6 billion annual economic impact to Arizona, according to a new study conducted by Arizona State University’s Seidman Institute. That’s the equivalent of the economic impact of hosting five Super Bowls. The study shows Raytheon’s annual impact across Arizona has grown by more than $500 million in the last three years. Increased sales, new hiring and additional infrastructure have helped to fuel the increase.
• IMPROVED CYBER SECURITY: Companies such as Blue Hexagon are using AI and “deep learning” to detect threats in less than a second with complete threat categorization, analysis and response, meaning that threats can be removed before they impact the organization. • IMPROVED BUSINESS ANALYTICS: AI can review data and detail important insights, allowing organizations to better track trends, find potential areas of concern and then have comprehensive reports with actionable items.
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The Joint Strike missile
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CEO SERIES
LIFE SCIENCE
Here’s why David Dexter is the perfect leader for Sonora Quest Laboratories
By MICHAEL GOSSIE
D
avid Dexter never dreamed of being a game-changer in business. “I never aspired to be a CEO,” says the president and CEO of Sonora Quest Laboratories. “I aspired to be a wildlife biologist.” But when he was 16, Dexter went to work for his older brother, who was then the CEO of the world’s largest laboratory. “I worked in the warehouse making $1.50 an hour,” Dexter recalls. “Then, after college, they asked me to develop chemical reagent systems for automated analyzers, which sounded like a fun thing to do.” From there, Dexter did more chemical development, got into quality control, then worked his way into laboratory management. “It seemed like we went through all these mergers and acquisitions and I was the last man standing,” Dexter says. When Dexter started at Sonora Quest, it was a $55-million-a-year operation. Today, Sonora Quest earns $300 million a year on the commercial side. Az Business: How have you been able to lead Sonora Quest to such phenomenal growth? David Dexter: When we started, the partners — Banner Health and Quest Diagnostics — really felt they would be the ones to provide innovation as a joint venture. As Banner Health has grown exponentially and Quest Diagnostics has grown exponentially, we have grown as Sonora Quest and Laboratory Sciences of Arizona into a very agile business — much more agile than the parent partners. When it comes to business creativity and innovation, we are really leaders in that respect. We can move a lot faster and react faster to changes in healthcare.
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and business creativity. Whenever you have this level of dynamic change, there will always be new business opportunities that manifest themselves that you might not have even considered last year. You’ve got to be able to recognize those opportunities and seize upon those opportunities in order to differentiate yourself in the marketplace.
DAVID DEXTER: “What I enjoy
most is making a difference,” says the president and CEO of Sonora Quest Laboratories. “I used to take a lot of individual pride in our accomplishments. Now, I much prefer to take a step into the background and enjoy the success of our leaders. My job is to empower people.” (Photo by Bruce Andersen, AZ Big Media)
AB: How do you view your industry today? DD: We are going through what I call transformational and disruptive change. As the CEO, you have to look at the glass half empty or half full. I look at it as twothird full and — by the way — we fill it up every day. We do that through innovation
AB: What do you love most about leading Sonora Quest? DD: Supporting and driving business creativity is what gives me the most pride. That’s the part that’s really going to change your value proposition. We have no equilibrium in healthcare and won’t for at least another three years. As long as you have that lack of equilibrium, there will always be opportunities to differentiate yourself. Innovation doesn’t mean just creating something new out of the box. It means utilizing technology and looking at your internal processes to constantly move the bar and create what we call an exceptional customer experience. AB: What qualities have made you such an effective leader for Sonora Quest? DD: My business philosophy is pretty simple: It’s not how many hits you get, but how many runs you score. We put a business plan together every year in August and it’s called “the roadmap.” We tie that business plan together with an incentive plan in which all employees participate. What you get is alignment across the entire organization — from the board to the senior leaders to all our employees. That is what sets the stage for focus and execution to get the desired results.
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MISSING PIECE LEADERS OF CHANGE: Morag
Lucey, CEO of Tempebased Televerde, and Chief Social Responsibility Officer Michelle Cirocco. (Photo by Bruce Andersen, AZ Big Media)
CHANGE
Televerde combats the shortage of tech workers by effectively employing and educating inmates to fill gaps
SOCIAL IMPACT: Many of the inmates who have graduated from Televerde’s program now hold positions at some of the most recognizable Fortune 500 companies in roles such as Marketo/Salesforce/Eloqua/Outreach administrator, telephony engineer, data warehouse and BI developer, marketing automation analyst, SQL reporting developers and more. (Provided photo)
By MICHAEL GOSSIE
O
ne of the biggest challenges business leaders in Arizona are facing is their ability to attract and retain talent. What they may not know is there is an eager population ready and willing to do whatever it takes to help their companies succeed … once they’re done serving their prison sentences. Yes, you heard that right. And it just might help some companies win the war for talent. “I’ve worked with other companies and we have such a shortage of people — especially women — in technology,” says Morag Lucey, CEO of Tempe-based Televerde, which generates demand and accelerates the sales pipeline for customers around the world. “As a country, we are not going to be competitive if we don’t have enough knowledge workers to move us forward. There are all these different communities of disempowered people that we are just leaving by the wayside and complaining that there’s a shortage of workers. So why not invest in these other communities where we can actually train them successfully to take these jobs that are so critical to our success?” Since 1994, Televerde has been training and hiring women in prisons.
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Not only have these incarcerated women helped generate $8 billion in revenue for Televerde’s client base — including SAP and Microsoft — but the women garnered valuable training, and earned degrees and certifications that will help them step into STEM roles upon completion of their prison sentences. Over the past 25 years, 3,000 female inmates have been through Televerde’s program. In 2018, the total number of formerly incarcerated women working at Televerde’s Phoenix headquarters was 58 — about 40 percent of the workforce — with an average annual base salary of $52,000 plus commission, bonus (if applicable) and full benefits. But it’s not just the former inmates who are reaping the economic benefits of Televerde’s program. While statewide rates of recidivism can be as high as 70 percent, it’s only about seven percent for the women who work with Televerde. At an average annual cost of approximately $24,000 to house an inmate, Televerde saves the State of Arizona and its taxpayers about $25 million annually by successfully keeping hundreds of women from returning to prison. “We have people at the Televerde headquarters in every department, at
every level of the organization — including about 30 percent of our leadership team — that started their career while they were incarcerated at the prison in Perryville,” says Chief Social Responsibility Officer Michelle Cirocco, who has been impacted personally by Televerde’s program. Once a convicted felon and now an executive with the $30-million sales and marketing organization, Cirocco has firsthand knowledge about how second chances, inclusion and access to opportunities can empower women. She’s been invited to the White House and created the first TED Talk hosted inside a prison. “What I knew when I started with Televerde more than 20 years ago was that I was in a place that I never thought I would be — prison — but there I was,” Cirocco says. “Televerde gave me the chance to turn my life around and the opportunity to support myself and my children and restart my life once I got out of prison.” “The beauty of Televerde is that we don’t look at the women as inmates, but as human potential that is being wasted,” Lucey says. “They are doing the same job and are given the same respect and opportunities as our employees outside of the prison, except they’re wearing orange.”
SAVE THE DATE January 16th, 2020 | 5:30 PM In partnership with the Association of Corporate Counsel and the State Bar of Arizona, Az Business Magazine will recognize the important and vital role that in-house counsel plays in an organization. Finalists represent the finest legal expertise across all industries in the private, public and nonprofit sectors. Save the date today for the 2020 Arizona Corporate Counsel Awards! All finalists will be featured in the Jan/Feb 2020 issue of Az Business magazine and honored at an awards ceremony in January.
Sponsorships available! Contact Josh.Schimmels@azBIGmedia.com to get involved!
Title Sponsors
Presenting Partners
Beverage Sponsor AB | November - December 2019 15
LAW
OVERTIME GAME Here’s what you need to know about the upcoming salary threshold changes for exempt employees By MICHAEL GOSSIE
A
lot of white-collar workers in Arizona are going to make more money next year and they won’t even have to endure a performance review to get that green. “The U.S. Department of Labor’s final rule updating overtime pay goes into effect on January 1, 2020 and makes some seemingly small changes that will affect a lot of employees,” says Dylan Wright, an associate at Radix Law. Jill Chasson, an attorney at Coppersmith Brockelman, explains what the new overtime rule actually says. “This rule is the first update to overtime regulations in 15 years, after an earlier attempt during the Obama administration was blocked in the courts,” Chasson says. “It sets a new salary threshold of $684 per week, or $35,568 per year, for executive, administrative and professional employees who are classified as exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA). These are typically called ‘white-collar’ exemptions.” In addition, Chasson says: • The new rule also increased the salary threshold for highly compensated employees, from $100,000 to $107,432 per year, and allows employers to use bonuses or commission to satisfy up to 10 percent of the salary requirement for white-collar exemptions, but not for highly compensated employees. • Exempt employees must still satisfy a duties test to meet the exemption requirements. The new rule does not change the current criteria for any of the duties tests. FEELING THE PINCH “The rule will most impact those line-level managers and assistant managers who, while filling a very important role, often do not make significantly more than the hourly employees 16
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they supervise,” says Lindsay M. Schafer, an attorney at Quarles & Brady, “particularly now that the minimum wage has been increased in Arizona.” But experts say some business sectors will feel the increased labor costs more than others. “The new overtime rule will only affect currently exempt whitecollar workers making between $23,660 and $35,568 annually,” says Tracy A. Miller, a shareholder at Ogletree, Deakins, Nash, Smoak & Stewart. “Those who meet this criteria are generally in the nonprofit, retail, or hospitality industries in rural areas. The Department of Labor estimates that 1.3 million workers will be affected, but I believe this number is overstated. The estimate makes a couple of unrealistic assumptions. Additionally, workers in this salary range who do not regularly work overtime could be negatively impacted if they are converted to hourly employees.” While many business owners and executives might feel frustrated by this increase in labor costs, consider this: It could have been worse. The rule going into effect Jan. 1 pales in comparison with a 2016 proposal that nearly doubled the salary threshold to $913 per week (or $47,476 per year) and included automatic increases to the minimum salary every three years. “The new rule is a compromise, a win for employers that is a significant departure from the rule the Obama administration had proposed, which would have had businesses paying 33 percent more per week to exempt employees at the minimum salary threshold,” says Gregory W. Seibt, partner at Blythe Grace. “While there will still be an economic impact, the industries that will feel it most are likely to be in retail and manufacturing and the like, where workers’ annual salaries are less than $35,568 … In sum, the new rule will require businesses whose employees make less than $684 per work week to decide between giving those employees a raise to at least $684 per week or paying them overtime.” AB | November - December 2019 17
LAW
Jill Chasson
Tracy A. Miller
Lindsay M. Schafer
IMPACT ON BUSINESS In addition to allowing employers to use non-discretionary bonuses and incentive payments to satisfy up to 10 percent of the salary threshold for exempt employees, the DOL will also allow employers to make catch-up payments to employees who do not earn enough in non-discretionary bonuses or incentive payments in a given 52-week period to retain exempt status, provided that the catch-up payment is made within one pay period of the end of the year. “Employers should note that the changes in these regulations, while disruptive, provide an excellent opportunity to investigate and resolve any lingering questions related to employee exemption status without raising a red flag,” Schafer says. Accordingly, Schafer says employers should use this time to evaluate positions that are close to the salary threshold, and any other positions that may be in question, prior to January 1, 2020. Before next year, she says employers should either increase pay to the threshold requirement or reclassify employees, taking care to develop a strong communications plan explaining the reasons for any changes that will be made.
Gregory W. Seibt
Dylan Wright
“It’s important to know whether the FLSA’s overtime rules apply to you,” Wright says. “Know whether you have employees who fall under the new limits for overtime exemption. Simply paying salaries on an annual basis does not avoid otherwise valid overtime obligations. You need to take a fine-grained look at who might become eligible on January 1, 2020.” Wright says if you already have non-exempt employees, be sure to work with your human resources personnel to bring your newly-eligible employees up to speed on your company’s overtime policies and procedures. If you don’t have any overtime policies in place, now might be the time to consult with a human resources specialist or employment attorney to make sure you’re compliant with applicable FLSA rules. “Businesses should look at the rule change as a good opportunity to review their exempt classifications,” Miller says. “If you are treating a worker making less than $35,568 annually as exempt, there is a decent chance this worker is misclassified based on the duties test. Even if your business is not affected by the rule change — and most will not be — you may find that you have misclassified workers. Now is a good time to correct those mistakes.”
PREPARING FOR CHANGE
This is how business owners and executives can best prepare for implementation of the new overtime rule, according to Jill Chasson, attorney at Coppersmith Brockelman: • Employers should review compensation for all exempt employees to determine who is currently being paid less than the new minimum salary. This is also a good time to evaluate whether exempt employees are properly classified, and to identify any pay disparities among similar employees that should be addressed. • Some employers may choose to comply by increasing certain employees’ pay to above the salary threshold. It is important to note that doing so may cause a ripple effect of pay raises across the company, depending on whether the company has an integrated compensation system. • If the employer chooses to reclassify certain employees as non-exempt, they should consider transitioning these employees to hourly pay in order to better track and calculate overtime. Employers also will want to take steps to ensure that newly nonexempt employees track their work hours properly and follow the company’s timekeeping policies and practices.
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HEALTHCARE
AN INFORMED DECISION Here’s how to make the most of open enrollment for health insurance By ALYSSA TUFTS
W
ith the 2020 Open Enrollment period running until Dec. 15, it’s important for companies to effectively communicate benefits and for employees to understand what benefits package best fits their needs. A lot of factors can impact how employers develop their benefit plans, which include company values, cost effectiveness and changing needs of both the employer and the employee. Andrea Rios, benefits sales executive with Lovitt & Touché, A Marsh & McLennan Agency LLC Company, aligns clients’ benefits strategies with their business goals and corporate culture, helping them accomplish their vision through managing short and longterm solutions.
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Andrea Rios She says Lovitt and Touché spends a lot of time working with employers to help them develop benefit plans and an effective communication strategy for those benefits. “That’s one of the most gratifying parts of working with businesses because we influence behavior directly by doing that,” she says. “We try to find out from the company or employer how they’re communicating to their employees today, if it’s effective, and if we can build on it to better educate and communicate most effectively to employees. Having a multi-pronged approach is the most effective strategy, but it starts with finding out how a company is communicating and how to be most effective for their population.”
Mike Tilton “We encourage employers to use a combination of printed material, email, chat and to hold meetings where they can present the information to their employees in person and allow for proactive Q&A sessions where employees can talk amongst each other, talk about their own experiences with the plans, and socialize some of the thought process around the decision making around their benefits,” he says.
EMPLOYEE PERSPECTIVE For many employees, a competitive benefits package is an important factor in deciding whether a prospective employer is the right fit and can be key in an employee’s security and peace of mind to take care of themselves and those important to them. DEVELOPING A PLAN “The overarching conversations we’re having with most of the Mike Tilton, general manager, Commercial Segment at Blue employers that we work with are trying to figure out not only Cross Blue Shield of Arizona, said developing a benefits plan how do they create an attractive environment for employees, but starts with offering choice. employee retention is a huge objective and the benefits program “We try to encourage employers not to offer too broad of a is one of the strongest tools they have outside of compensation to menu of options or it becomes confusing for people. When you do that, often times they’ll just do what they did last year,” Tilton help with that,” Tilton says. says. “When we build out our product portfolios, we try to think According to a 2018 Society for Human Resource Management (SHRM) Employee Benefits report, 34 percent of organizations broadly about different types of network options. Does someone need a big, broad network or are they someone who doesn’t have a increased benefit offerings in the last 12 months. Organizations that did were most likely to increase health-related (51 percent), strong affinity with a particular provider?” wellness (44 percent) and employee programs and services (39 “We also try to encourage more than one plan offering, and what we find a lot more now as people are becoming more engaged percent) benefits. The top reasons cited for increasing benefits were to retain employees (72 percent), to attract new talent (58 as consumers in healthcare, there’s a lot more interest in health savings accounts (HSAs) and plans that allow employees to percent) and to respond to employee feedback (54 percent). leverage the tax benefit of an HSA product, but also allows them Often, one of the first times employers will introduce benefits to to effectively plan for not only their healthcare costs now, but also an employee is in a new hire orientation or in a conversation with to leverage the HSA for their healthcare costs in the future and whoever is in charge of benefits. Rios says that while this may be really start to think about healthcare the way they think about a the first time an employee is aware of what benefits are available 401(k) plan,” Tilton says. to them, it’s also important for employers to keep the conversation Tilton says BCBSAZ recommends employers meet consumers open to employees throughout the year as well to reach them where they are, which includes employees that span multiple consistently during their time at the company to have additional generations and prefer to receive information in different ways. opportunities to learn at different times about the benefits. AB | November - December 2019 21
HEALTHCARE
“Having comprehensive benefits and an effective benefit communication strategy are a great chance for the employer to demonstrate their commitment to the employee’s overall health.” — Mike Tilton
Tilton echoes Rios’ opinion. “We suggest rather than simply communicating at the time that they have to make the open enrollment decision, that they do take periodic opportunities to remind employees about the plan and how to maximize the value of it,” Tilton says. “But there are also some great milestones around the year mark that will allow employees to actually think about what their costs are going to be.”
“Having comprehensive benefits and an effective benefit communication strategy are a great chance for the employer to demonstrate their commitment to the employee’s overall health,” Tilton says. “It’s not just a matter of them coming to work every day and working hard and not really caring about their life outside of the workplace. There’s a significant amount of correlation between a person’s health status and their mental acuity and productivity.”
TAX TIME GUIDANCE One of the ways to do that is through preparing to file taxes. Tilton says by gathering medical claims and receipts throughout the previous year, employees can get a clearer idea of what they’re spending on healthcare. Tilton says Blue Cross Blue Shield recommends employers communicate the benefits program to employees on a yearround basis so “employers can maximize the perceived value of the benefits,” so, for example, if it’s heart health month, employers can include an annual preventive exam, an annual physical or flu vaccinations and communicate its availability to employees Tilton says. In addition, Tilton says employers are moving to defining the benefits contribution and “providing education and guidance on things employees should be thinking about before they make a decision, but they want employees to buy the benefits that matter most to their employees,” Tilton says. “We see a lot more employers saying, ‘We want employees engaged in healthcare, so we’re going to encourage and incentivize them to take health risk assessments to understand or improve their health status,’” which has long-term benefits that will reduce cost to the company.
THE HR COMPONENT This correlation can be important to note for human resources professionals, who Tilton says not only evaluate healthcare costs, but look at the total human capital costs which include absenteeism, productivity, disability claims and worker’s compensation, all of which can be driven by an employee’s health status. The SHRM report also found 92 percent of employees indicated benefits are important to their overall job satisfaction and showed a relationship between benefits and retention. Twenty-nine percent of employees cited their overall benefits package as a top reason to look for a position outside of their current company in the next 12 months; 32 percent who were unlikely to look for an external position also cited their overall benefits package as a top reason as well. “Often times, benefits are a reflection of the company’s culture,” Rios says. “And that’s really at the heart of all of it. Once we understand what a company’s goals are around that and how they are taking advantage of their employee benefits package to ultimately better reflect their company’s culture, then we can make a true impact.”
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MINING
IMPACT RUNS DEEP
Mining industry fuels economies on both sides of the border By VICTORIA HARKER
A
rizona’s historic mining industry is among the most abundant on the planet, producing copper, lead and zinc that make the world go round. Freeport-McMoran, ASARCO, Newmont, Rio Tinto, Taseko, Hudbay, South32, these are the industry giants investing billions of dollars in state-of-the-art operations here. As the demand for metals rises along with the world’s population, Arizona is positioned to reap the economic benefits. Arizona’s border state, Sonora, Mexico, is a large producer of silver, putting it in a similar position. Tariff-free trade is essential to their continued viability, Harry “Red” Conger, president and chief operating officerAmericas for Freeport-McMoRan, Inc., told a large crowd of business leaders and policy makers at the 60th Anniversary Summit of the Arizona-Mexico Commission (AMC) in Phoenix. Under the free trade agreement, the North American Free Trade Agreement (NAFTA), Arizona and Sonora have developed extensive supply chains across both borders that provide jobs and revenue for communities, he said. “I’m a native son of Arizona, but I think of myself as a regional native. I’ve always been blind to the border,” said Conger, whose father was a mining engineer at a copper mine near Marana. “There’s a lot that goes on in mining in this part of the world that moves back and forth across the border.”
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Supply chains support local economies Conger was a speaker at the AMC Summit along with Arizona Gov. Doug Ducey and Sonora Gov. Claudia Pavlovich who spoke about “The Future of North American Trade.” Their primary message was to urge ratification of a new open trade agreement, the United States-Mexico-Canada Agreement (USMCA), that will replace the outdated NAFTA and bring it into the modern, digital age. CEOs, trade officials and policymakers came together at the event to strategize and collaborate on cross border initiatives to promote economic development in 16 areas including mining. AMC’s mission is to improve the economic prosperity and quality of life for residents through public-private collaborations in advocacy, trade, networking and information. Preserving free and open trade between the three countries is a primary goal of the commission this year. Expansion and modernization of border crossings to increase international commerce is another. Freeport-McMoran, which generates $2.4 billion in direct and indirect revenues to the state and 22,700 direct and indirect jobs, benefits from NAFTA, and currently is exploring mining opportunities in both states. “We’re very optimistic that we’ll have more mining operations in the region and we’d like for some of those
to be on the other side of the border,” Conger said. “We are an international entity. We are a free trader and very much support everyone’s efforts for a new trade agreement.” New mining projects in Arizona Freeport is one of 27 major mines in Arizona that account for a $4.87 billion impact on the Arizona economy and 51,800 direct and indirect jobs, according to the Arizona Commerce Authority. A number of new mining operations have announced new and planned projects including: • Hermosa Project South32, an Australian Mining Company, purchased the $2.3 billion project to develop a state-of-the-art underground mine in the Patagonia Mountains near Nogales. It will mine lead, zinc, and silver. Once completed, the mine is expected to impact over 3,000 people in the state of Sonora and Arizona through employment opportunities, economic stimulus, and production. • Florence Copper Mine Parent company Taseko Mines commenced operations this year at its new in-situ copper recovery facility in Florence. The commercial life of the project is expected to be 25 years. Arizona would receive an economic uplift of $3.4
billion with $2.1 billion remaining in Pinal County. • ASARCO completed a $229-million modernization of the historic Hayden copper smelter. Owned by Grupo Mexico, the mine has restarted operations. The smelter employs 560 and contributes about $122 million annually to the economy. • Freeport McMoRan Inc. is completing a $250 million modernization of equipment at the historic Miami smelter near Globe. The Miami mining operation employs 760 and has an annual economic impact of about $267 million. • Resolution Copper has spent $40 million cleaning up a hundred-year old mining site before it starts construction on a mine that will be the largest in North America. Owners Rio Tinto and BHP have invested over $2 billion in developing the project since 2004 and are entering the final permit stage. • Excelsior Mining Corp. announced that it has been issued the first new copper mine permit in Arizona in over a decade. The federal Environmental Protection Agency issued an operating permit for in-situ recovery mining for the Gunnison Copper Project between Benson and Willcox. Victoria Harker is a writer for Chamber Business News.
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MINING
HERE’S HOW THE MINING INDUSTRY IS CONNECTING
Resolution Copper partnered with Northern Arizona University’s (NAU) Department of Applied Indigenous Studies for the Indigenous Nation-Building Education course series. “Through this partnership, over 45 unique Native and Indigenous nations and communities have benefited from 29 projects crafted to meet their specific needs via the Indigenous Nation Building Education Course Series,” Bennett said. The company also partnered with NAU for the Tribal Leadership Initiative activities for 2017-2018. Bennett explained that the initiative “is a multi-component program dedicated to expanding the capacities of Indigenous nations and communities.”
A healthy workforce The University of Arizona (UA) is working to make mining a healthier career option for the future workforce. Miners can be exposed to diesel particulate matter, which affects the heart and lungs, and toxic vehicle emissions. A research team at the UA is addressing By SIERRA CIARAMELLA the hazardous components miners face on the job. s mining continues to grow in Building a talent pipeline The UA Mel and Enid Zuckerman College the state, industry professionals The team behind Resolution Copper of Public Health received a grant from the and education leaders are works to create a talent pipeline between the National Institute of Occupational Safety working to prepare the future workforce mining industry and the future workforce. and Public Health to determine how the for career options. “Since the inception of our scholarship use of alternative fuel mixtures can reduce “There is a demand for mining program in 2002, we have awarded 172 exposure to hazardous components. professionals, and it is important for scholarships totaling $674,000,” said Bennett. Dr. Jeff Burgess, principal investigator of us to maintain a close connection to “As a community partner, Resolution Copper the research, said the research will include the future workforce. Our industry is committed to the investment in local two phases. continues to become more competitive and communities and the development of local “One, can we reduce the exposures? If sophisticated every day,” said Kyle Bennett, economies and workforce.” we can, can we improve the health of the Rio Tinto Kennecott communications He explained the program includes miners?” he explained. principal advisor. scholarships for Native Americans, The research team plans to work with Rio Tinto was founded in 1873 and leadership scholarships and general partner mines and UA’s student-run mine, is one of the world’s largest metals and scholarships. the San Xavier Underground Mining mining corporations. Its subsidiary, “Being a part of mining allows you Laboratory. Resolution Copper Company, is leading to work with a diverse and talented “We work constantly at the university Resolution Copper Mining with BHP group of people from all over the world to make sure our students have the skills Copper, Inc. to collaborate on new technologies and they need to succeed when they graduate,” Resolution Copper Mining is a proposed techniques that will continue to drive Dr. Burgess said. copper mine set to supply copper to mining into the future. There are also a support technological and environmental lot of career advancement opportunities,” Sierra Ciaramella is a writer for Chamber Business News. innovation, located near Superior, AZ. Bennett said.
with the future workforce
A
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ARIZONA ENERGY CONSORTIUM
WINDS OF CHANGE Defining the goal posts in a transformative energy economy
By MICHELLE DE BLASI
There have been many advancements in the energy industry over the past decade, yet major opportunities remain for implementing reasonable, balanced long-term energy policies. Unless one is directly engaged in an industry on a daily basis, it is difficult to comprehend the day-to-day complexities in developing and implementing an effective policy regime. Although the loudest voices may be the ones heard, they do not necessarily reflect the positions that are the best for industry development.
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ENERGY LEADER: Michelle De Blasi is the executive director of the Arizona Energy Consortium and is a well-known environmental attorney. Her in-depth experience encompasses a wide range of environmental law areas with an emphasis on natural resources matters, including traditional and renewable energy project development, environmental permitting and compliance, and greenhouse gas emissions. (Photo by Mike Mertes, AZ Big Media)
The ability of any industry to flourish is only as strong as the policies set to support it. Such policies impact the amount of regulation, the amount of investment needed for continued industry development and the ability of the industry to advance. If uncertainty is raised by these policies, there are detrimental impacts to industry development. This delicate balance between the government’s interest in protecting the consumer and the industry’s goals of developing in a predictable playing field must be carefully achieved. Without transparency and fair discussion, public participation in this process declines due to a lack of confidence that a fair result can be realized. This process is further impacted with additional factors of changing market conditions, evolving disruptive technologies and lack of a federal energy policy. The confusion and complexities created by these factors can overpower any rational discourse that would otherwise lead to a solutionoriented process. Finding common ground to resolve these issues is not a simple task. Since 2011, the Arizona Energy Consortium (AEC) has focused on working with industry stakeholders to create an attractive business environment that promotes development, while still protecting our valuable resources for a sustainable future. The AEC actively promotes collaboration in the industry for growth and retention of energy companies. We continue our efforts AB | November - December 2019 29
ARIZONA ENERGY CONSORTIUM to develop and implement energy policies that work in the real world, and benefit both the providers and users of energy in our changing energy economy. WHAT POLICY TRENDS ARE SHAPING THE ENERGY INDUSTRY? The many exciting advancements in disruptive technologies over the past decade make it difficult to predict the future of energy in the long-term. However, the energy sector will continue its transformation from a fossil-fueled economy, and predominant advancements will continue to be decarbonization of energy resources and reduced water use. Advancements in battery storage technologies, both for utility-scale and residential use, will continue to support further deployment of renewable energy resources. The speed with which these changes will be accomplished, and the opportunities that will be gained or lost, will be determined by the amount of certainty in policymaking for long-term growth. There are many examples where the lack of a clear and stable policy and regulatory environment resulted in further difficulties for capital investment to flow into developing sectors. Other than poor management, it’s one of the main reasons that start-up businesses fail. The continued adoption and expansion of a decarbonized energy sector cannot fully occur until investment capital finds certainty in the industry, and securing capital remains an issue for much of the industry. The transformation from decades of investment in fossil-fueled infrastructure to a decarbonized energy economy takes significant planning and coordination to succeed. Many jurisdictions have been focusing on encouraging robust development for new technologies by reducing industry and policy barriers. As with any transformative progression, regulators and utilities must be mindful to avoid unintended consequences of changes in policy. The aggressive mandates in some jurisdictions that are inevitably impacting the energy markets of their surrounding states are having consequences that the originators of those mandates may not have anticipated. For instance, California’s strong solar energy generation mandates 30
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have resulted in less deployment of solar energy generation in Arizona. Since Arizona can take advantage of excess solar power from its neighboring state at much lower costs (including negative pricing) than building its own solar generation, this regional cooperation has benefited the Arizona consumers while allowing California to offload power it could not otherwise utilize. WHAT’S THE FUTURE OF THE ENERGY SECTOR? As the U.S. fleet of coal-generation resources ages, it is important to fully understand the costs to deploy newer decarbonized energy technologies. Utilities who must replace larger capacity and more efficient fossil-fueled generation with smaller, more expensive decarbonized energy generation resources face many challenges that will take some time to overcome. In addition, the grid must continue to be modernized to support the changing load profiles and more advanced technologies. All of these costs will ultimately be borne by the customer. There are many proposed policy changes facing Arizona that could have significant impact on regional transmission and generation. To find success in Arizona, the industry must shift its mindset from viewing decarbonized generation resources as a means to satisfy a renewable energy mandate to an opportunity to stimulate and enhance the economy and diversify the state’s energy mix. Since industry development is attracted by consistent policy and access to capital, Arizona and its regional neighbors must adopt energy policies conducive to both. An additional benefit to this continued diversification of the energy mix is greater security for the state’s economy that can more easily adjust to a reduction in the carbonbased power resources. It is important to realize that this diversification cannot happen overnight and must be carefully planned to avoid undesirable consequences. While there is some collaboration driving the transformation of the energy sector, the amount of regional cooperation will be critical to a robust
industry that takes advantage of what each jurisdiction can contribute. It will be important for all stakeholders to work together to ensure that as fossil-fueled facilities are decommissioned they can be repurposed, and displaced workers can be trained to work in the new energy economy. Through its efforts such as the Southwest Energy Conference, the AEC continues to work with key stakeholders to provide an open discourse about how to best achieve these goals regardless of one’s position on climate change. The AEC actively promotes collaboration for growth and retention of all industries that impact the energy sector, whether they are producers or users of power. One critical technology for the transition to a decarbonized energy economy is battery storage. With technology advancements and reduction of costs for utilities, this technology will have significant long-term impacts on centralized generation peak shaving and stabilization of intermittent renewable energy resources. The AEC believes that with more collaboration among industry stakeholders to find opportunities to better utilize resources, the transformations in the energy sector will continue to flourish to the benefit of the customer. The AEC is looking forward to helping shape the course of the energy sector over the next decade as technologies continue to improve and the energy sector is transformed. We will continue to act as a resource and a forum for industry to share solutions to power Arizona’s future. Michelle De Blasi is a prominent environmental attorney and director at Fennemore Craig. She is also executive director of the Arizona Energy Consortium.
LEARN MORE
What 2nd Annual Southwest Energy Conference When Nov. 13-14, 2019 Where The Clayton House, Scottsdale Information arizonaenergyconsortium.com
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MARKETING
WHAT TO IGNORE AND WHAT TO ADOPT for true success in the coming year
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arketing trends are always in motion. What’s popular one month becomes a thing of the past as new social media platforms emerge, technologies develop and audience preferences change. While marketers can feel drawn to the latest and greatest, a disciplined marketing professional first knows and implements the basics. With 2020 approaching, take time to review your marketing best practices and take note of trends to see where your strategies might need a refresh. Jackie Wright Marketing
MIND THE RESEARCH AND DATA There are several marketing best practices that should be in every company’s toolkit, the most important of which includes knowing your competitive landscape, researching your customers and tracking data. These tried and true basics work across businesses, industries and company sizes as the foundation for great marketing. Knowing how your company differs from your competitive set is the basis for any effective marketing plan. Performing a SWOT analysis will help you understand how your product or service is unique and how it provides customers with something your competitors do not. Speaking of customers, do you really know yours? A good marketer researches to understand the details of their target customer and reassesses that information each year as consumers and their preferences change. A key piece of this process includes mapping the customer journey, which illustrates how your ideal customer goes from knowing nothing about your business to making a purchase. In addition to knowing competitors and customers, good marketers obsessively track and analyze data. Setting goals and measuring performance against them empowers marketers to understand what is working and what is not while allowing for course correction during campaigns. WORK TO DIVERSIFY Video is king for the foreseeable future, but that does not mean it is a fit for your brand. Unseasoned marketing pros may chase big trends, such as video, and invest all of their time and budget in 32
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that space. But an experienced marketer works to understand the many different messaging channels and uses their customer research and journey mapping to implement the best strategies for the brand and budget.
PERSONALIZATION, PERSONALIZATION, PERSONALIZATION 2020 and beyond will be the era of personalization. Today’s consumers demand authentic brands and individualized experiences. Host a launch event where team members or brand advocates can communicate directly with customers. Use social media to conduct one-on-one conversations. Leverage microinfluencers who can deliver tailored messages to engaged audiences. No matter how personalization works best for your brand, be sure it is a part of your strategy.
PAID, EARNED, SHARED AND OWNED The PESO model is the modern standard of current day marketing and public relations. Rather than relying solely on earned coverage through media relations, the PR experts on your marketing team should implement strategies in the paid, earned, shared and owned spaces. Paying for well-placed bylined articles and maintaining a blog on your company’s websites are just two examples of ways your marketing team can execute the PESO model to create more robust campaigns featuring multiple consumer touchpoints. SUMMARY As 2020 nears, this is a great time to take stock of some of the up-and-coming marketing opportunities for your business. However, avoid being tempted by the allure of what’s new at the expense of tried and true fundamentals. A commitment to marketing basics helps create a solid foundation on which to build successful marketing strategies for many years to come. Jackie Wright is the president of Rainmaker Integrated, a public relations and marketing firm with a specialization in restaurant, retail, hospitality, multifamily housing and niche healthcare.
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DINING
KICK-ASH DINING EXPERIENCE
Maple & Ash brings a whole new level of innovation, sophistication and irreverence to Arizona’s dining scene By MICHAEL GOSSIE
Y
ou know you’re in for a unique dining experience when the chef’s tasting menu is listed simply as “I don’t give a F*@K.” And the highly anticipated Maple & Ash, which opened in August in Scottsdale, doesn’t disappoint. If anything, it exceeds all expectations you might have for a restaurant led by two-Michelin-star Chef Danny Grant of the What If Syndicate restaurant group. Despite finding acclaim in Chicago, Grant cut his culinary chops in Arizona. He moved to Scottsdale with his family as a teenager and spent the early years of his career in the kitchen of elements, an acclaimed restaurant at Sanctuary Camelback Resort & Spa. Grant relocated to Chicago in his early twenties, where Food & Wine magazine named him Best New Chef in 2012. He earned Michelin stars in 2011 and 2012 before founding Maple & Ash in Chicago’s Gold Coast neighborhood in 2015. The restaurant is known for its maple and ash wood-fired hearth and Grant’s modern and innovative twist on the classic steakhouse. But if you’re expecting a traditional steakhouse, you might feel like the kid who gets on the roller-coaster thinking it’s a merry-go-round. Your world is about to get rocked. And that’s exactly what Grant wants. Walking into Maple & Ash, you’re immediately struck by the phenomenal atmosphere and an energy that tells you you’re in for something special even before you take your first bite. The restaurant is filled with faces — both young and old, dressed up and dressed down — all with smiles because they know they are part of a truly amazing dining experience. And the staff who facilitates that experience — from the time you’re seated until the time you pay your check — is so professional, knowledgeable and attentive that it’s impossible to find a flaw. 34
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But what puts Maple & Ash on a pedestal is its food. Grant’s irreverent and bold menu at Maple & Ash is highlighted by a variety of steak, seafood and house-made pasta dishes, all paired with a wine cellar that Wine Spectator magazine called “one of the most outstanding in the world.” This is usually the part of the story where we give menu recommendations, but every Maple & Ash menu item is so well thought out and so perfectly executed that you could throw a dart at the menu and have the best dining experience of your life. But if you’re looking for something on the surf side, the cannot-miss item is Maple & Ash’s signature fire-roasted seafood tower, a double-decker of lobster, shrimp, oysters and clams. You’ll forget you’re in the desert because won’t find a tastier tower anyplace in the world. And the aforementioned “I don’t give a F*@K” best-of-themenu option, although a bit pricey at $155, is worth every penny … and more. Grant has been known to say he wants Maple & Ash diners to have fun and leave the restaurant feeling like they don’t want to leave. “The best dinner ever. The best party ever.” Rest assured, after one visit to Maple & Ash, all those boxes will be checked. MAPLE & ASH Where: Scottsdale Waterfront, 7135 E. Camelback Rd., Scottsdale Hours: Sunday through Thursday from 5-10 p.m. and Friday and Saturday from 5-11 p.m. Information: mapleandash.com
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HOLIDAY PARTY PLANNNG
A CATERED AFFAIR Here are some catering cues to prevent holiday party planning blues By ERIN THORBURN
I
t may be the season to be jolly, but those tasked with holiday party planning may feel like their fa-la-la-lling behind. There are venues and menus to choose, dates to solidify and a todo list that would make Santa’s wish list pale in comparison. Partnering with a local catering company has helped many party planners get through the holidays (at least relatively unscathed). So how do some of Arizona’s favorite catering companies help businesses just like yours to prepare for a festive, fun and stressfree holiday party? ’Tis the time to calendar way ahead Typically, when planning a holiday party, especially a sizable event, it’s best to solidify your venue far in advance. “We begin booking holiday parties for the year as early as March,” says Pat Christofolo, president of Artisan by Santa Barbara Catering. “If you want your ideal date and vendors, it is always best to book far ahead. If your company is not able to begin planning until later in the year, you should always check which dates are available with your top vendor choices before settling on a date for your company gathering. This will make it easier for you to narrow down which dates are still available.” Christofolo also suggests considering hosting your company party on a weekday, versus a weekend. “Vendors may be able to offer discounts for these ‘off days,’” she says. “Our group starts booking holiday parties as early as August,” adds Christopher Collins, fourth-generation restaurateur and founder of Common Ground Culinary. “There are only so many days between Thanksgiving and Christmas when the entire neighborhood wants to plan business and family events. A lastminute booking means you may have to settle for a date or time that isn’t traditionally booked.” Chestnuts roasting and limited toasting The menu. Even looking at the word can be overwhelming for holiday hosts. After all, the meal criteria to consider feels infinite — budget parameters, food allergies, meal preferences, plated versus buffet. To reduce that overwhelming feeling, take an honest appraisal at the event size. Small and intimate or gargantuan gala? “When it comes to smaller events, it’s beneficial for the host to select a small menu that guides the guest to pick something at a pre-determined cost point, versus letting the guest pick anything on the menu,” Collins says. Plated dinners often work well for smaller holiday parties. Not
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Pat Christofolo
Christopher Collins
Jennifer Russo
only does this catering style help control costs, but it also provides a more cozy, inclusive ambiance. As for large-scale holiday events, buffet meal service often works well. “For larger parties with a budget in mind, we suggest sticking to a buffet and limiting the food selection,” Collins says, “while adding a few stations around the venue to help move guests around and keep them mingling.” If you’re looking for additional ways to help massage the budget, think about re-imagining a traditional sit-down dinner with these suggested alternatives from Jennifer Russo, owner and chef of Jennifer’s Catering. “Outsource your own plasticware and flatware,” Russo says. “Or, have appetizer stations instead of a full dinner buffet. Or, if it’s a late evening event, then just provide a dessert bar. Large events can be much cheaper if you only serve wine and beer for the bar instead of having a full bar with all the liquors.” Russo’s last point is something for which many caterers unanimously agree: Alcohol is a holiday-budget buster. “Our first suggestion to anyone hosting an event is to control the bar offerings,” Collins says. “Costs won’t skyrocket with the food, but it can easily get out of hand with bar provisions. We suggest focusing on a modest selection of craft beer and West Coast wines and leaving out the expensive liquors.” Not-so-secret Santas Although employees deemed with the responsibility of holiday party prep know many of the ins and outs of catering, there are some services for which they may not be aware. “We offer pick-ups, deliveries, delivery set-ups and full-service events,” Russo says. “So if you missed the mark on your fullservice event, don’t have your guests go hungry. If you are trying to be cost-effective, try our pick-up option.” “We pride ourselves on truly making every event a custom experience, from flower arrangements to holiday decorations, and more,” Collins adds. “We have a team available to make any vision come true. That’s beneficial when the party planner might have other areas of responsibilities and can’t afford to make goodie bags or individual place settings.” Beyond special add-ons and services, catering companies also have unique offerings. Take, for example, Common Ground Culinary’s ice cream cart, which serves handmade ice cream from Sweet Provisions. “We offer upgrades to our culinary stations to include interactive chef-action items,” Christofolo says, “such as flaming desserts, salad walls, and more to create excitement at an event. If you have a specific theme, sharing it with the catering company can help create a special look for the culinary stations. “Our event producer also knows all of the current event trends and can help book entertainment or photo opportunities,” Christofolo says. With all that holiday party planning demands, why not delegate whatever tasks you can? Remember to ask your caterer if they provide set-up, cleaning, trash service and whatever other requirements you wish to get off your plate. And, be sure to verify whether there is an additional fee. AB | November - December 2019 37
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HOLIDAY PARTY VENUES
20
UNIQUE VENUES
to book a last-minute holiday party
By MICHAEL GOSSIE
The economy is humming along. You’ve had a phenomenal year. Things have been so busy that the office holiday party was put on the back burner and still needs to be planned. Never fear. Even if the office holiday party is something that slipped your mind, there are plenty of dynamic Valley venues still available to create a memorable holiday event for employees. Here are 20 hot spots where you can celebrate your company and book a last-minute holiday party or an off-site event to boost company morale.
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Bitter & Twisted Cocktail Parlour Options: Celebrate your holiday event with Bitter & Twisted Cocktail Parlour in Downtown Phoenix. Stylish with the downtown edge, Bitter & Twisted Cocktail Parlour boasts innovative bar bites and a world-class, award-winning and globally recognized cocktail program. The kitchen churns out globally inspired dishes like Seoul fried chicken, Korean nachos, and fish and chips. To book: events@bitterandtwistedaz.com
Blue Clover Distillery Options: Blue Clover Distillery is a stunning, rustic bar space that can accommodate 189 people inside and 100 more on the patio with a buffet menu for groups of 20 people or more. Guests will enjoy craft cocktails with Blue Clover’s house-made gin and vodkas as well as a lineup of elevated bar food favorites like green chile fries, apple blue cheese flatbread or the farm egg and bacon grilled cheese. To book: wholm@bluecloverdistillery.com
Fellow Osteria Options: Take advantage of beautiful Scottsdale with the indoor-outdoor layout that seats as many as 140 guests. Celebrate the holiday festivities on the modern style patio. Fellow Osteria’s Italian menu includes pizzas, pasta, sandwiches, and salads, all made from farmfresh ingredients. Guests can also enjoy ice cream from Scottsdale’s own Sweet Republic, as well as wine, craft beer, and cocktails. To book: fellowosteria.com/reservations
Boulders Resort & Spa Options: Let the unsurpassed beauty of the Boulders Resort be the inspiration for your holiday party. The Latilla Ballroom offers gracious hospitality, sumptuous cuisine, floor-to-ceiling windows with awe-inspiring backdrops, and outdoor fireplaces. A special rate of $149/night is offered when booking a holiday party of 20 or more or a block of guest rooms. To book: Contact Erin Donovan at 480-488-6738 or erin.donovan@hilton.com
Flint by Baltaire Options: Flint by Baltaire is an elegant, yet inviting event space for all occasions. Flint by Baltaire takes special care with their special events team to work with you to coordinate every detail of your event. Executive Chef Chris Mayo will meet with you to curate a menu that fits your guests’ needs, and a sommelier can recommend the perfect wines to pair with your menu, and even design a handcrafted cocktail that gives your event a personal touch. To book: Contact Alyssa Pope at apope@ flintbybaltaire.com
Dierks Bentley’s Whiskey Row Options: At Dierks Bentley’s Whiskey Row, you’ll find something extra and unique. From live country music and line dancing to American gastropub cuisine and delicious cocktails, these folks will show your guests a great time. Choose between one of three Valley locations where you could host up to 600 guests. To book: dierkswhiskeyrow.com/private-events EVO Options: Celebrate your next holiday party at Scottsdale’s EVO, a neighborhood restaurant famed for Italian style, housemade pasta and craft cocktails. With pre-set seasonal menus to fit any budget and taste buds, hosting your party with EVO is the perfect way to ensure that your next event is a success. To book: Contact Mary Lott at 480-265-9814 or mary@evoscottsdale.com. Farm & Craft Options: Farm & Craft is focused on healthy and sustainable food in a community-style atmosphere. Think modern farm with a contemporary twist. Choose between two Valleywide locations that both feature an indoor/ outdoor bar that you can host up to 200 people. To book: ilovefarmandcraft.com/private-events
Four Seasons Resort Scottsdale at Troon North Options: Four Seasons Resort Scottsdale creates custom holiday parties for gatherings large and small. Options range from a Latin dinner on Talavera patio overlooking Pinnacle Peak to a casual evening in Route 66-themed Proof Canteen with entrees straight from the smoker and a classic Soda Jerk station to boot. To book: Contact Katie Klerk at 480-513-5266 or katie.klerk@fourseasons.com. J&G Steakhouse Options: In the penthouse of the Phoenician, find a breath-taking view and an incredible dining experience at J&G Steakhouse. There are event options to fit your specific needs, from the size of the room to the details of the menu. Indulge your taste buds on steakhouse fare like French onion soup, tuna tartare, bone-in rib eye steaks, and Maine lobster. To book: Contact Elena Torres at 480-2148000 or elena.torres@luxurycollection.com Little Rituals Options: In the heart of Downtown Phoenix, you will find Little Rituals: a stylish, modern space features touches like custom globe chandeliers and an Arizona-theme mural. Its AB | November - December 2019 41
HOLIDAY PARTY VENUES Boulders Resort & Spa
dedicated menu of food-and-drink pairings features innovative dishes like vegan beet carpaccio and rice pudding infused with seasonal fruit. Invite 80 of your closest friends and let Little Rituals host your holiday party. To book: events@littleritualsbar.com Mastro’s Restaurants Options: Each Mastro’s Restaurant offers private dining experiences that are completely customizable and can accommodate parties of any size that desire private space, all the way up to a full restaurant buyout. Food and beverage minimums depend on the space, day of the week and seasonality - so Mastro’s encourages guests to speak directly with their Director of Events in any location about specifics to hosting your perfect holiday event. To book: mastrosrestaurants.com Nico Heirloom Kitchen Options: Nico Heirloom Kitchen is Gilbert’s signature dining destination offering West Coast-inspired seasonal Italian cuisine that will truly WOW your guests. From intimate gatherings to a full restaurant buyout, Nico offers something for everyone this holiday season. The restaurant can host up to 150 guests depending on the day. To book: nicoaz.com Riot House Options: Host your holiday party at Riot Hospitality Group’s newest location. Channeling the breezy lifestyle of 42
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South Beach, Riot House specializes in handcrafted cocktails and a Miami inspired food menu. Its open floor concept can accommodate up to 300 guests. To book: riothousescottsdale.com/private-events
local flavors that everyone can enjoy. The indoor-outdoor marketplace is home to local restaurants, purveyors, and artisans, including cocktail bar Pobrecito, health food outpost Foxy Fruit, bottle shop Sauvage, and Mexican eatery Provecho. Adorned with local art and murals, the venue can host private events that seat as many as 300 guests (bring all your friends). To book: thechurchillphx.com/private-event
The Collins Small Batch Kitchen Options: Where classic meets creative, celebrate your holiday party in style at The Collins Small Batch Kitchen. Serving visionary takes on American and international dishes, the menu Royal Palms Resort and Spa features options like pecan wood-fired Options: As one of Arizona’s most artichokes, braised beef short rib, salmon celebrated historic resorts, Royal tartare, and margarita pizza. The elegant Palms offers a variety of private dining outdoor patio can be reserved for private opportunities in unique venues throughout gatherings for as many as 24 guests. the nine-acre Mediterranean-style estate To book: thecollinsaz.com/reservations that was built in 1929. One of the most iconic locales is the Orange Grove, an Tomaso’s outdoor venue encircling a 100-year-old Options: Tomaso’s has been a staple in Orange tree, an inviting fireplace and the Valley’s dining scene for over four a dramatic Camelback Mountain view. decades, serving high-quality, traditional Whether it’s a party of five or 500, Royal Italian food in a beautiful, upscale space Palms always impresses. Ask about the with classic Italian design elements “Drink on Us” holiday promotion. including murals and brick accents. Its To book: Contact Kathleen Doeller at private dining space can accommodate kathleen.doeller@royalpalmshotel.com or up to 175 people for weddings, birthdays, 602-808-3113. business functions and holiday parties. To book: cristina@maggioregroup.com Skylanes Options: Plan your holiday party with Wonderspaces a little action at Scottsdale’s boutique Options: With art that rewrites the laws bowling club, Skylanes. Skylanes features that govern the physical world, Elsewhere six high-tech interactive bowling lanes, – the latest installation at Wonderspaces along with killer cocktails and menu, it will at Scottsdale Fashion Square – is the take your celebration to the next level. ultimate holiday outing for a business To book: group that embraces creativity. Each events@eegazcom or 480-429-6000 unique show features immersive, thoughtprovoking concepts for an incredible The Churchill shared experience, capped off by a custom Options: The Churchill brings together the refreshment menu. Downtown Phoenix community, and offers To book: groups-az@wonderspaces.com
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SMALL BUSINESS
Magical
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moments Cloth & Flame helps diners experience one-of-a-kind meals and events
By MICHAEL GOSSIE
I
Weddings: Cloth & Flame does inclusive full-service t’s not a coincidence that a company that creates outdoor weddings. The beauty of a location-centric out-of-this-world events and dining experiences was wedding is that each space is decided on and designed born in the clouds. around the couple’s ideas, rather than the designated “My wife and I started a hot air balloon company areas of an established venue. “Nobody wants a paint-byin 2013,” says Matt Cooley. “Cloth & Flame was born number for their wedding day,” Cooley says. “People love out of the luxury dinners that became part of the to create one-of-a-kind weddings and we are able to do balloon ride experience, where we allowed people to Matt Cooley that for them.” share a meal and the experience with other people in a Corporate and private events: Remarkable and deeply customizable compelling place.” retreats and dining events, tailored to bucket-list wishes that the Cloth & Flame takes experiential dining to a never-beforeclient might have or playing off a corporate brand. seen level. Launched in December of 2016 by Cooley and his “The most logistically challenging event we’ve done was wife and co-founder, Olivia Laux, Cloth & Flame hosts awecorporate lunch at the base of the Grand Canyon,” Cooley says. “We inspiring dinners with astonishing views of nature. Some of built a luxury restroom from scratch. We were not allowed to use Cloth & Flame’s most memorable meals have been at the base glass or flames and it had to be a zero-waste event. We worked with of the Grand Canyon, on a dock in Puget Sound, in the middle the Hualapai Tribe for seven months to make it happen, but it was of Central Avenue in Downtown Phoenix, and at the base of the unreal. It was a stunning event.” spectacular Superstition Mountains. The ability to create those memorable moments helped Cloth & “When we started Cloth & Flame, we thought we were starting Flame quadruple the business Cooley and Laux’s balloon company a wilderness dining company,” Cooley says. “What we ended up had been doing in its first year — largely through word of mouth creating is a modular experiences company. We look at ourselves and social media. Some of the country’s most innovative companies as a venue activation brand. We take spaces that otherwise — including Google and car companies — have taken notice and wouldn’t be available to an event planner, for a wedding or for a utilized Cloth & Flame to produce unforgettable events that both corporate event and we make them available. We deliver one-ofstrengthen their brands and engage clients and employees. a-kind experiences that take guests away from the cookie-cutter “We create wherever you can imagine by acting as a venue, venues.” designer, and production company,” Cooley says. “We are experts at CLOTH & FLAME HOSTS THREE MAIN TYPES OF EVENTS: molding conversations into turn-key events in extraordinary spaces Community dinners: Immersive and collaborative farm-to-table and creating events that those who attend will never forget.” dinners in unexpected places, designed to foster community and To learn more about Cloth & Flame, visit clothandflame.com. conversations in a new way.
EXTRAORDINARY VIEW: “When you attend a Cloth & Flame event, you’re going to get something deeply immersive,”
says co-founder Matt Cooley. “Our events pull people out of their comfort zone and into a common space, opens up the conversation and lets people share a one-of-a-kind experience.” (Provided photo) AB | November - December 2019 45
Rational numbers
Arizona CFOs reveal cautious optimism for 2020 — and even beyond By MICHAEL GOSSIE
R
ecent Google searches for the term “recession” surged to their highest levels in more than a decade. But don’t tell that to Arizona’s chief financial officers, who have a fairly positive view for the remainder of 2019 and for the next two years. Although early predictions for a downturn in 2019 have not come true, Arizona’s industry leaders are planning for the unexpected while hoping for the best. Results from the 2019-2020 Arizona CFO Spotlight Survey indicate a strong focus on operational efficiency, reputation management, and talent planning. The fourth annual survey was developed by BeachFleischman in collaboration with BOK Financial, Phoenix CEO-CFO Group, Financial Executives and Affiliates of Tucson (FEAT), Pinnacle Plan Design, MOD Ventures, and Contempo HCM — with survey development and support from Ingenuity Marketing Group.
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WORKFORCE TALENT TRENDS Acknowledging for the fourth year in a row that talent is a major source of concern for companies across all eight industries surveyed, leaders are actively pursuing talent solutions that include: • Referral incentives and more flexible or remote work arrangements. • Absorbing increased mandated wage or benefits costs to maintain competitiveness. • Pursuing more in-house and online training to onboard or promote workers. • Deferring hiring in favor of investments in efficient processes and automation. • Re-assignments and promotions from within to expand career tracks and improve retention. CAPITAL INVESTMENTS ON THE RISE Because financing terms are attractive, leaders are also acting on long-term capital outlays for plant improvements,
2019
including technology upgrades that improve efficiency, as well as property expansions and larger equipment purchases. They are also paying down debt or refinancing to improve their debt position. This activity is leading to more optimism in the financial markets. Short-term, CFOs are considering changes to their accounting method and other ways to align with tax reform TECHNOLOGY: Tech companies experienced slower growth in 2018 opportunities. than in 2017, which makes leaders cautiously optimistic for the coming 12 months — seeing growth opportunities in cyber, data A FOCUS ON REPUTATION MANAGEMENT management and broadband connectivity solutions. As for reputation management, increased efforts to manage brands and customer or patient satisfaction are evident in health care, hospitality and nonprofit organizations. Health care leaders are investing in outcome-based patient satisfaction tools. Hospitality venues are updating their physical stores and adding personalized touches based on customer feedback. Nonprofit organizations are investing in their social channels and publicizing more results and success stories. “Leaders are preparing, trying to anticipate change but also keeping their organizations efficient and focused,” noted Marc D. Fleischman, chief executive officer of BeachFleischman. “For example, construction backlogs overall are still high in our region and fees are up, but labor is tight and Arizona has a higher cost of living, which might deter new residents and business expansion. Or it might not. This environment of optimism and uncertainty is happening in every industry.” OTHER INDUSTRY HIGHLIGHTS HEALTHCARE: Specialty health care leaders are more optimistic than leaders in hospitals and general care clinics due to improved specialty care coverage options as well as the willingness by some patients to pay out of pocket for non-surgical treatment options.
RETAIL: Physical retail re-leasing rates are expected to drop by 20-30 percent. Real estate leaders and investors are shifting some focus to opportunity zones as well as changes in how manufacturing and office space will be leased. HOSPITALITY: Hospitality and entertainment leaders are upgrading facilities and expanding consumer choices to better position their brands. MANUFACTURING: Supply line disruptions and continued tariff uncertainty make manufacturing leaders wonder about potential plant retooling needs and new orders through 2021, but optimism is high for 2019 results. NONPROFIT AND GOVERNMENT: Nonprofit and government leaders are moderately optimistic, investing in field technology for boots-on-the-ground services and identifying new sources of revenue through potential public/private partnerships. Overall, Arizona is still viewed as an attractive market for entrepreneurs. This perception gives most surveyed leaders a fairly positive view for the remainder of 2019 and for the next two years.
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2019 LETTER FROM THE PRESIDENT The Arizona Chapter of Financial Executives International (FEI) appreciates and thanks you for your interest in the 13th Annual CFO of the Year Awards. FEI Arizona is presenting the CFO of the Year Awards Adam Remis to senior level financial professionals for outstanding performance in their roles as corporate financial leaders and stewards. The nominations and awards recognize exemplary financial management the Greater Phoenix Business community. An independent set of carefully elected and well-qualified judges from Arizona’s business community and academia have selected winners based on their contributions to their respective organizations and their overall involvement in the Arizona business community. FEI’s mission is to advance the success of senior level financial executives, their organizations and the profession. The FEI Arizona chapter is comprised of Phoenix Metro-area executives who represent and advocate for the interests of finance professionals of companies in all industries and all sizes within the public, private and nonprofit sectors throughout the state. FEI Arizona serves the community by offering its members opportunities to network with their peers, stay apprised of current financial policy, standards and regulatory guidelines, continue their professional development and form valuable relationships with community leaders. We also maintain an academic awards program to encourage professional advancement of promising, financefocused students and offer career assistance and development to members. FEI Arizona also contributes to the research and advocacy activities of our national FEI organization which impact the strategic planning of the profession’s policy, standards and regulatory structure. FEI continuously recruits new members who meet our membership criteria and who are interested in the value gained from becoming an FEI chapter member. Membership is open to CFOs, controllers, treasurers, tax executives, academic professors, and other senior-level finance professionals whose positions and company size meet FEI’s membership criteria. Additional information may be found on the national and chapter websites, financialexecutives.org and feiaz.org. Finally, FEI Arizona would like to thank our sponsors who have worked so closely and diligently with us to make this event a success: Vaco, Lovitt and Touché, Keyser, DLA Piper, CBIZ MHM, Chase and AZ Business magazine. Very truly yours, Adam Remis, President, FEI Arizona
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Recognizing professionals for outstanding performance in their roles as corporate financial stewards
PRESIDENT Adam Remis Chief Accounting Officer, Harvest Health & Recreation Inc.
SECOND VICE PRESIDENT Robbie Molnar CFO, Midstate Mechanical
SECRETARY/TREASURER Adam Miller CFO and Executive Vice President, Barron Lighting Group
PAST PRESIDENT Rachael Piergallini Vice President of Finance, Derma Health Skin And Laser
FEI ARIZONA BOARD MEMBERS Michael Day
President, Grand Canyon Wealth Management
Ben Dobson CFO, dunnhumby Americas
Susan Hunsacker VP Finance, Cafe Valley
Andrea Jones CFO, Bemo USA Corporation
David Klemm Director of Finance, Friendship Village of Tempe
Donald Laughlin CFO, Pinnacle Transplant Technologies
Eric Malick Vice President of Finance, American Vision Partners
Chris Niezgodzki Director of Financial Planning & Analysis, Zovio, Inc.
Nathan O’Connor EVP, Equity Methods
Alan Peril Principal, AJP Financial Services
Gabriela Rayas Director of FP&A, Barron Lighting Group
James Walbom CFO, SIteLock
CFO OF THE YEAR SPONSOR REPRESENTATIVES
Kristen Campbell, director of business development, DLA Piper Ian Davie, member, Keyser Josh Schimmels, publisher, Az BIG Media Deborah Kimes, business development manager, CBIZ MHM Jody Sarchett, executive vice president, Lovitt & Touche Adam Sheets, executive director, Chase Mike Green, partner, Vaco
2019
MARK BARRIERE Chief financial officer
SWD Urethane BACKGROUND: Barriere is responsible for
planning, implementing, managing and controlling all financial‐related activities of the company. This includes direct responsibility for accounting, treasury, forecasting, strategic planning, costing, legal, property management, business technology, human resources, deal analysis and negotiations. LEADERSHIP: Barriere used his vision and judgement to redesign a sales pricing matrix for use by the sales team for competitive price positioning of SWD’s products. This authorized pricing matrix allows a level of autonomy for the sales team to quickly react to daily market conditions to achieve overall sales objectives and eliminates a secondary financial approval.
JOHN ANDREWS Chief financial officer
Circle the City Hemisphere GNSS BACKGROUND: Andrews is responsible for
administering the general accounting, financial and statistical reporting functions in accordance with established policies and accounting procedures. LEADERSHIP: When Andrews started at
Circle the City in 2014, the company’s revenue sources consisted primarily of hospital contracts, Maricopa County funding and private grants and donations. Over the course of one year, Andrews was instrumental in procuring Circle the City’s initial federal funding through the Health Resources & Services Administration. This allowed the company to be considered a Federally Qualified Health Center and resulted in doubling annual revenue within his first year with the Company.
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ADRIAN BROWN
Managing director international, chief financial officer
AeroGuard Flight Training Center BACKGROUND: Brown is a key member of the
senior executive team and brings not only strong financial disciplines and best practices to AeroGuard, but he has instilled an objective and metrics-based decision-making mindset to the company. LEADERSHIP: When AeroGuard was acquired in 2016, the financial predicament of the company was in an unstable position. Brown played a critical role in stabilizing the accuracy of the internal financial statements, being able to provide reliable information that would be used to make informed business decisions.
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PETER COLLING 2019
Chief financial officer
Colling Media TEAM DEVELOPMENT: Colling encourages professional education and the use of technology, including reporting tools. More specifically, Colling regularly challenges the controller to find innovative ways to improve processes and reporting. All ideas are welcome, recognized and rewarded. Despite a 400 percent growth in billing over the past four years, the size of the staff remains the same. LEADERSHIP: Colling insisted that sales hunters, account manager and delivery team have clear job responsibilities without a significant overlap. Colling quickly identified the problem and worked with the team leaders of each department and provided the CEO a detailed plan to distinguish everyone’s role and responsibility.
THOMAS CASTELLANOS
LARRY COLTHARP
Chief financial officer
Grossman Company Properties
RI International BACKGROUND: Castellanos’s leadership at RI
International, an Arizona-based international not-forprofit organization, has led to rapid, yet thoughtful, growth over the past three years that is unparalleled in the company’s 29 year history; achieving all of this within an evolving healthcare landscape that has landed many similar mental health-focused provider organizations at risk during the past year. LEADERSHIP: When Castellanos arrived at RI International three years ago, the company had 13 days of cash on hand and now remains consistently between 50 and 70 days, even within the current cash pressures of starting recently awarded programs in seven different cities.
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Chief financial officer and senior vice president BACKGROUND: Coltharp oversees financial and
tax reporting, treasury management, information technology and risk management. During his tenure, the organization has increased its multi-state real estate holdings with five hotel acquisitions, a villas construction project, multiple site renovations, and various multifamily joint ventures, as well as growing (and leasing) mixed-use properties and completing a large residential development. LEADERSHIP: Coltharp has identified increasing opportunities to provide more timely and accurate information on operational performance, development costs, and hotel rebranding and growth initiatives. He has also led the initiatives to migrate the company to various cloud based computer systems.
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2019
ELIZABETH DODD Chief financial officer
TriWest Healthcare Alliance BACKGROUND: Dodd is responsible for the planning,
directing, and monitoring of TriWest’s financial, accounting, and reporting activities. As a member of the company’s Core Leadership Team, her full portfolio of responsibility includes finance and accounting, information technology, contract administration, subcontract administration, claims administration, data management, tax, treasury and facilities. LEADERSHIP: In 2013, after the loss of the company’s only major contract, Dodd was instrumental to the development of a new business plan, which culminated in bidding on and securing a $4.2 billion contract with the Department of Veterans Affairs to serve the specialty healthcare needs of veterans.
JOANNE FIMBRES Chief financial officer
Pendergast School District BACKGROUND: Fimbres
TIM EINWECHTER Chief financial officer
Innovative Health BACKGROUND: Being a CFO
of a start-up has its challenges, but Einwechter makes it look easy. Einwechter provides strategic leadership and direction regarding the financial activities of the organization. Einwechter is the key steward of the financial and physical assets and serves as a strategic partner in setting the vision and direction concerning the fiscal health of the organization. He has been the driving force behind the private equity investments for Innovative Health, while providing each functional area the opportunity to do what is needed to build an infrastructure for Innovative Health — founded in 2015 — to grow into a successful profitable company.
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oversees the budget and finance, purchasing, warehouse, information technology, maintenance, transportation and food service departments. In January 2017, she began her position as CFO, overseeing the financial, procurement and warehouse functions. In September 2017, as the chief operations officer position was vacated, she helped the district reorganize, accepted the additional responsibility, and applied her expertise to oversee all of finance and operations for the district. LEADERSHIP: Fimbres is keenly aware of the need to both reduce costs and bring in revenue streams, and she has done just that. Under her tutelage, gifts and donations from partnerships have resulted in an additional $422,000 in revenue.
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2019
PATRIC GREER Chief financial officer
Edkey, Inc BACKGROUND: Greer has been responsible
for the company’s finance since 1999. He has supervised student transportation, technology, student food service, facilities operations and student information systems. He was instrumental in orchestrating the issuing of more than $100 million in bonds for the building of more than 800,000 square feet in facilities, which provide educational opportunity for roughly 6,000 K-12 students. SOCIAL RESPONSIBILITY: Greer has showcased appropriate use of state and federal monies. This fiscal responsibility has placed him in a position where he has been asked to be an intricate part of developing and deciphering fiscal rules and regulations for Arizona’s Public Charter Schools.
KATHY GERHART Chief financial officer
State Bar of Arizona BACKGROUND: Gerhart provides leadership and
direction of the financial operations for Arizona’s largest professional organization. This leadership has allowed the State Bar of Arizona to effectively and efficiently meet its mission to serve and protect the public with respect to the provision of legal services and access to justice. INNOVATION: Gerhart was instrumental in the development of the Innovation Council at the Bar and serves as its senior leader liaison. The mission of the council is to promote organizational effectiveness by thinking creatively through brainstorming ideas and solutions for new and existing processes to benefit employees and the organization and reports directly to the CEO.
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NICHOLAS HARE Chief financial officer
Hexagon Mining BACKGROUND: As COO and CFO, Hare leads
the planning and execution of Hexagon Mining’s corporate development and business transformation efforts. He is helping to establish Hexagon’s mining division as a market leader and is responsible for driving all commercial activities across global regions, product portfolios and shared service functions, aligned to Hexagon’s mission of empowering the industry’s digital future. LEADERSHIP: Hare transformed the mining division from legacy acquisitions to a balanced integrated business achieving record growth for the second consecutive year within Hexagon. He overhauled commercial processes and empowered the company’s sales staff with new sales tools, new pricing and enhanced incentives.
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LISA AUTINO JOHNSON Chief financial officer
Caliente Construction
2019
BACKGROUND: Autino Johnson is responsible
for managing the accounting operations, risk management and information technology of the company as well as its relationships with the financial community. INNOVATION: Since joining Caliente, Autino
Johnson has introduced numerous systems to increase efficiency and automate tasks. She automated the accounting process, making it more efficient and greatly reducing and eliminating paper reporting and documentation. She automated the subcontractor billing process and implemented an automated process to ensure that bonds were being closed upon completion of a project. Her systems have made the accounting department a profit center for the company.
MARK JOOS ROB HOWATT Chief financial officer
Dansons BACKGROUND: Howatt is a key member of
the executive team and works closely with the owners, while assuming a strategic role in the overall management of the organization. His day-to-day responsibilities include managing all financial-related activities and assessing potential M&A targets. LEADERSHIP: Prior to 2017, Dansons was a small Canadian company and a skeletal support staff. Howatt has led the organization through a period of dramatic change and hyper-growth that has seen revenue growth exceed 1,000 percent. The Dansons group is now composed of 17 companies with projected revenues of $300 million in 2019.
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Executive vice president and chief financial officer
CopperPoint Insurance Companies BACKGROUND: Joos is responsible for
overseeing all finance functions across the enterprise. This includes financial reporting and planning, general and operational accounting, actuarial, pricing, reserving, reinsurance and enterprise risk management, in addition to overseeing the company’s chief investment officer. INNOVATION: Throughout the 2018 integration of PacificComp to the CopperPoint Family of Insurance Companies, Joos had an integral role in bringing two finance organizations, systems and processes and people together. Specific accomplishments include converting the general ledger, fixed assets, payable systems and reviewing planning tools and processes. These efforts led to a very successful acquisition and integration of PacificComp.
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2019
COLIN MALCHOW Chief financial officer
Synergis Education LEADERSHIP: Malchow took over at a precarious time in the organization’s history: the company was about to have its second year in a row of revenue declines and was still hemorrhaging cash. The company had raised capital approximately 18 months before, but the cash on hand was not enough to sustain another 18 months at the historical burn rate. Malchow brought a number of ideas to help stabilize revenues near current levels, eliminate unprofitable partnerships and substantially reduce overhead. Through the implementation of these programs, the company turned EBITDA positive for the next two years and will resume revenue growth in 2019 for the first time since 2014.
PAUL MALEK Chief financial officer
Massage Envy Franchise BACKGROUND: After Malek assumed the role of
CFO, he immediately began making great strides in the organization. He took a “founder based” financially run business and put the necessary controls in place to ensure the business could operate at a higher level. From day one, he established methods of control that allowed the organization to capture additional EBITDA on an accelerated basis. LEADERSHIP: Malek was instrumental in Massage Envy’s most recent securitization effort. Wellness businesses traditionally haven’t gone this route for refinancing, but Malek led the charge. His ability to help financial institutions understand the business model and financial structure was groundbreaking.
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BRIAN MOORE Chief financial officer
Prescott Unified School District LEADERSHIP: Moore stepped into the CFO position mid-year amongst crisis. He was tasked to research major budgetary problems and resolve them. Coming from the position of principal and math teacher prior, many questioned how this would work. Moore used his deep knowledge of district operations and history, as well as his inquisitive and investigative nature, rounded off by the true math teacher in him. These skills combined to work exceptionally well, allowing Moore to explain the extremely complex problems and systems of school budgeting. He has put systems in place to move from a reactive and helpless financial situation to a proactive and confident situation.
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2019
DANIELLE PUENTE Chief financial officer
DP Electric BACKGROUND: Puente works closely with all
areas of the organization to improve processes, reduce risk and empower future company leaders. She plays an active role in DP Electric’s weekly and monthly operations meetings and seeks ways to improve the work environment and minimize challenges of project management and field management teams. LEADERSHIP: In 2017, Puente led the initiative to revamp DP Electric’s mission statement and core values that had not been updated since the company’s creation in 1990. Since this project’s completion, Puente has worked closely with the HR manager to ensure DP Electric’s core values are incorporated into interview questions, performance reviews, trainings and employee appreciation initiatives.
STEVEN REICHLING Chief financial officer
Accelerate Diagnostics BACKGROUND: In addition to being CFO,
Reichling is the head of Accelerate Diagnostics’ manufacturing, operations, legal and IT groups, thus providing leadership across nearly the entire enterprise. LEADERSHIP: Reichling has contributed enormous value to Accelerate by leading multiple successful rounds of fund raising. This capital has supported the development and commercialization of Accelerate’s life-saving technology, the Accelerate Pheno system. Reichling and his team successfully raised $175 million in convertible senior notes in 2018, $89 million in proceeds from a common stock public offering in 2017, and $109 million in proceeds from a common stock public offering in 2016.
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STARLA REICHOW Chief financial officer
Kinematics BACKGROUND: Reichow is responsible for all
accounting and finance functions including accounts receivable, credit and collections, accounts payable, payroll, inventory and manufacturing accounting, capital budgeting and all financial reporting and analysis. She is also a key contributor to the strategic planning process, including development of missions, vision, values, along with financial and tactical initiatives and monitoring metrics. TEAM DEVELOPMENT: Reichow is a big proponent
of continuing education. She started the “Passing Grade Reimbursement” program at Kinematics, where an employee can choose to take continuing education or college-level courses to further their career with Kinematics. When the employee passes, the company will reimburse them.
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PAUL RUBSAM 2019
Director of Finance and Facilities
Notre Dame Preparatory High School BACKGROUND: Rubsam strives to
achieve the goals of Catholic education. He acts as consultant to the president and principal, administrators, department heads and various committees of the school on all matters related to finance. LEADERSHIP: Rubsam uses his expertise to continually help the school operate in the black, which is often difficult for a nonprofit school. Currently, Notre Dame is raising money to expand the school. With an outstanding bond on the property, Rubsam is securing additional funding for the building while refinancing outstanding debt to ensure that the school is able to continue paying the same amount for debt.
ROBERT ROCHE
Vice president and chief financial officer
ALAN SCHNAID
Executive vice president and chief financial officer, finance, IT, strategy
Carlisle Companies Incorporated
PetSmart
BACKGROUND: Roche is responsible for
BACKGROUND: Schnaid leads the
providing leadership to and management of Carlisle’s accounting, tax, treasury IT, investor relations and financial planning and analysis teams. Roche also interfaces with the investor and sell-side analyst community. LEADERSHIP: Roche provided important
guidance in stabilizing and rightsizing the footprint of Carlisle’s second-largest business, Carlisle Interconnect Technologies, after a significant loss of high-margin product sales due to a customer in-sourcing initiative and a technology shift within the in-flight entertainment connectivity market. Roche’s experience in restructuring businesses throughout his career provided the sound judgement required to recommend wise corrective actions.
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information technology, financial planning and analysis, enterprise project management, advanced analytics, controllership, treasury, investor relations, internal audit, loss prevention and safety, strategy and business analytics and procurement areas within PetSmart. Additionally, he is significantly involved with PetSmart’s wholly-owned, stand-alone subsidiary, Chewy. LEADERSHIP: Schnaid led PetSmart during the recent Chewy IPO process. He accomplished this without having any Chewy leaders reporting to him. Schnaid was able to successfully influence Chewy leadership to ensure that Chewy didn’t take any positions during the IPO which might be problematic to the future consolidated (PetSmart + Chewy) best interests of PetSmart.
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HILLA SFERRUZZA
Executive vice president and chief financial officer
Meritage Homes Corporation BACKGROUND: Sferruzza is a subject matter expert on residential
construction and land acquisition, debt and equity capital transactions, M&A and divesture structures, financial modeling, budgeting and forecasting, and process improvement opportunities. LEADERSHIP: Sferruzza has been influential in the development and implementation of Meritage’s strategic pivot to focus on the entry-level and first move-up homebuyer segments exclusively, by streamlining the business to reduce costs, be more efficient and maximize Meritage’s growth and profitability in a competitive market. Less than three years into the shift, Meritage is already outperforming the industry as a result of the successful execution of its strategy.
MARK STRASZYNSKI Senior vice president and chief financial officer
Best Western Hotels & Resorts BACKGROUND: Straszynski sets
department in CampusLogic — the fastest-growing software company in Arizona two years running. Shannon’s duties range from the traditional, leading the accounting and finance departments, to business operations, legal, corporate risk and facilities. Shannon and her team work closely with leadership to present them with data and integrated tools and processes to support the strategic and day-to-day needs of the company.
strategic financial direction for the iconic brand, overseeing strategic planning, finance, accounting, treasury and risk management. He also sits on the brand’s senior executive team, which shapes and executes Best Western Hotels & Resorts’ long-term strategies. Straszynski has a proven executive management track record of driving: strategies, financial reengineering, profitable revenue growth and solutions to enhance company value with more than 25 years’ experience in financial management.
LEADERSHIP: Shannon has been instrumental in getting two acquisitions negotiated and integrated while she’s been at CampusLogic. She is also responsible for negotiating vendor and lease agreements, including the one for the company’s new 20,000-square-foot headquarters space in south Chandler.
LEADERSHIP: Under Straszynski’s guidance, the company invested $2 billion into its hotels, expanding from one brand to 16, and unveiled a fresh new identity to appeal to today’s travelers.
COLLEEN SHANNON Chief financial officer
CampusLogic BACKGROUND: Shannon’s efforts impact every
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On behalf of the Edkey Inc. Family of Schools, we want to congratulate Patric Greer on this welldeserved recognition. For over 20 years, Patric has been a consistent strategic financial leader, for the most mission diverse family of schools in the entire nation.
Congratulations Patric! Edkey Inc. Arizona Charter Schools 1460 South Horne, Mesa, AZ 85204 Phone: (480) 461-3200
Where Every Student is Known
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2019
ALISON ZAJACEK Chief financial officer
StrataTech Education Group BACKGROUND: Zajacek began as a corporate controller at StrataTech in 2009, when the education group had three campuses, less than 100 employees and 1,700 students, and $35 million in revenues. By 2011, Zajacek was named CFO and used her leadership skills to help the institution thrive. In 2018, StrataTech ended the year with five campuses, more than 330 employees and 3,000 students, and more than $70 million in revenues. LEADERSHIP: Zajacek worked together
with StrataTech’s CEO to develop a robust employee benefits package. Zajacek also made it a priority to build out the organization’s HR department – growing the department from virtually non-existent to a full staff.
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RONALD ZOROMSKI Chief financial officer
Great Hearts America/Great Hearts Arizona BACKGROUND: Zoromski is a member of the senior leadership team for Great Hearts, which will enroll 19,000 students this year. He manages Great Hearts’ finance function and oversees planning and analysis, accounting, payroll, accounts payable, business financing and various other financial services across the organization. In his two years as CFO, Zoromski has brought several improvements to Great Hearts’ business outcomes. LEADERSHIP: Zoromski oversees the relationships with banking, finance
and insurance partners, along with major real estate and construction vendors that provide services to Great Hearts, which builds two or three new schools each year with total annual construction budgets exceeding $40 million.
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WEALTH MANAGEMENT
your money in 2020 By MICHAEL GOSSIE
K
irtus Brutsman was having dinner when the conversation drifted to a local high school and its upcoming homecoming dance. “The uncertainty, excitement, and for some, dread; all these are emotions most people can relate to from our high school year,” says Brutsman, a financial advisor with Wilde Wealth Management Group. “Similarly, these are the same emotions that we all experience going into the election year. As we move into this period of uncertainty, it is vital that we set aside our emotions and stick to our disciplines.” Brutsman isn’t talking about the discipline it takes for a high school boy to keep his shirt tucked in at the homecoming dance. He’s talking strict dollars and cents. “We believe the global economy is about to enter a low-growth period of uncertainty, a period we expect to persist into 2020,” he says. “Adding to the uncertainty surrounding the election, our economy is in a late-cycle environment in which macro conditions are increasingly signaling deterioration.” Other experts agree. Chris Smith, founder of Chris Smith Investments, says the markets are ripe for uncertainty and volatility as we head into 2020. “This is an excellent time to review your current asset allocation and ensure that it matches up with your risk tolerance,” Smith says. “My advice would be to have as little debt as possible and if there are financial commitments within the next 24 months such as buying a new vehicle, replacing a roof, or funding college, to take those funds out of the market now and set them aside. Opportunistically, I would trim any overvalued positions to build up some cash for potential bargains.” So what does that mean if you’re trying to figure out where to put your money heading into 2020?
Kirtus Brutsman
Chris Smith
“Living in the desert has given my family many learning opportunities,” says Brutsman. “One of those is to respect the diverse seasons of the desert. The hot summer months, the rainy monsoon months, or the beautiful spring days that we all look forward to. As a Phoenician, you learn how to be prepared for each of those seasons; similarly, one must strive to be prepared for uncertain economic times. From an investment standpoint, I would encourage each family to stress test their portfolios, before the anticipated uncertainty, and stay alert for opportunities in the coming months. “We are positioning multi-asset allocation portfolios considering our outlook for the global economy and markets,” Brutsman continues. “Given broadly slowing growth, increasing geopolitical uncertainty, and generally higher levels of volatility, we are modestly underweight risk, relative to our benchmark and are building liquidity to take advantage of tactical buying opportunities.” Over the next several pages, you’ll get to learn what other financial management experts say to look for in 2020 and beyond.
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WEALTH MANAGEMENT BACKGROUND: Bottolfson and his team, The Stahle Bottolfson Group, provide a personalized plan for the families they serve that incorporates what matters most to them. With a plan in hand, their clients can make decisions with confidence and simplify the modern-day complexities of their financial lives.
Craig Bottolfson Wealth management advisor
Merrill, a Bank of America Company fa.ml.com/sbgroupaz
TREND TO WATCH: “In 2016, interest rates in the United States reached the lowest levels recorded in our history. After inching up the last couple of years, we are once again flirting with these alltime lows. This has presented a great challenge to retirees looking to support their lifestyle with income from their investments. Different strategies incorporating multiple asset classes will be required to construct a portfolio that can continue to provide the income and stability that retirees desire.” ADVICE FOR 2020: “There are countless financial decisions all of us make throughout our lives… some more significant than others. Whether it is prioritizing the funding of different goals, allocating investments to maximize tax efficiency or optimizing your Social Security benefits, the cumulative effect of even the smaller decisions can lead to drastically different outcomes over time. Seek out a trustworthy guide to help you make these decisions with confidence.”
Industry trends to watch KEITH BAUM, managing director of asset management, Abbot Downing:
“The bull market for stocks will have its tenth birthday before long. It’s been a great ride, but all good things must come to an end eventually. Investors will need to navigate markets carefully for a while.” ARTHUR T. DOGLIONE, president, Alpha Fiduciary:
“2020 will likely bring further challenge as investors may be distracted by political events and want to make fear based decisions. Having a flexible and adaptable portfolio management approach that can reduce downside capture for clients should trends actually change will be key.”
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GARDEN ART
AZ TOTEM ART aztotemart.com | 602.677.5999 View more than 25 studio art pieces on site By Appointment Only
WEALTH MANAGEMENT BACKGROUND: Urban is president and CEO of On the Money, an accounting and bookkeeping firm in Phoenix. The company’s mission is to help businesses take control of finances. As a certified Profit First professional, she serves as a trusted advisor to clients, helping them build highly profitable businesses.
Ruth Urban President and CEO
On the Money onthemoneyaz.com
TREND TO WATCH: “Predictions of an upcoming recession may ring true or not. Nevertheless, in my casual conversations with businesspeople, I am hearing we are getting prepared by being more conservative with our financial decisions. Some of us are just recovering from the Great Recession and have learned from experience. No one expects the same level of severity; however, we are fearful of just a little pinch of that pain. We are spending differently than in the past. While retail spending, vehicle purchases and housing (owned) expense shows a downward trend, contributions to pensions and personal insurance is rising. Consumers and businesses are being strategic about their spending.” ADVICE FOR 2020: “Address profitability in your businesses. Business owners tend to pay themselves last, if at all. Let’s change our traditional method of driving up revenue and concentrate instead on driving up profitability. Building up a reserve from those profits gives businesses an edge when sales slow. Set aside a chunk of revenue for owner’s compensation. Focusing on profitability and owner’s compensation forces businesses to carefully analyze every expense and look at each client or revenue stream to make sure they are feasible and have a healthy profit margin. Small shifts in mindset create huge benefits – recession proof businesses and happy owners in times good or bad.”
Industry trends to watch MARK FELDMAN, CEO and managing partner, MRA Associates:
“The people in our industry continue to fight for talented employees and building closer, more meaningful relationships with our clients. In a rapidly upward trending stock market, we need to be smart and prudent with these two key stakeholders.” STEPHEN TADDIE, managing partner, Stellar Capital Management:
“The industry outlook is solid, as quality financial advice and investment management doesn’t go out of style. With riskfree rates of return barely exceeding inflation, finding trusted advisers to navigate investments in ‘risk assets’ is important for any serious investor.”
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WEALTH MANAGEMENT
Liz Shabaker, CFP CEO
Versant Capital Management versantcm.com
BACKGROUND: Shabaker manages Versant Capital Management’s strategic direction, delivering the firm’s mission of helping people reach their life and financial goals. Through her stewardship, Versant is a fiduciary that adheres to the highest legal standard to act in the best interests of the people it serves. Shabaker is also active in the community through numerous committees, board memberships and philanthropic activities. TREND TO WATCH: “There is a new generation of investors whose wealth management expectations and preferences have been shaped by new technologies and by their living through the last financial crisis. They bring new industry standards to how financial advice and investment strategies are delivered. A focus on enhancing the changing ways people prefer to communicate with advisors, continually expanding service offerings, and creating powerful and memorable experiences, has to be at the forefront of wealth management firms going forward to meet their client’s growing needs.” ADVICE FOR 2020: “It’s imperative we address today’s ‘longevity challenge’ (making one’s income last a lifetime while our population is living longer than ever). We must help people start vigorous financial planning earlier in their careers, before they meet a traditional wealth management minimum, to help balance both their immediate and laterin-life financial goals. Through strategic fiscal trade-offs and shifts in ways of thinking about money (behavior biases), younger people can create a flexible plan that works for them today, and that also meets their needs over the next 50-plus years and into retirement.”
Industry trends to watch THOMAS CONNELLY, president and chief investment officer, Versant Capital Management:
“There is too much capacity in financial services. As new technologies are applied, and consumers become more cost-conscious, value propositions need to be executed. Firms that apply resources to solve client problems will survive.” CALVIN P. GOETZ, founder and president, Strategy Financial Group:
“As the U.S. economy reaches full employment and wages rise, we will likely see this aging bull market stretch a little longer. I think increased volatility is here to stay. Pre-retirees should check in on their exposure to make sure it’s consistent with their risk tolerance.”
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WEALTH MANAGEMENT
Lennard van der Feltz Founding partner
Pinnacle Financial Advisors teampinnacle.net
BACKGROUND: With experience in domestic and global business, van der Feltz is known for blending his business and finance acumen with a fervent interest in technology and the supporting role it plays in helping clients achieve their financial goals. TREND TO WATCH: “Next year is an election year which may portend a change in administration that would likely result in a reversal of recent de-regulation and income tax trends. With our nation almost evenly split politically and many government policies implemented by executive order, we may see ourselves flip-flopping over the long term between more socialist-friendly and more capitalist-friendly policies. What money choices to make in the face of such uncertainty is driving more and more people to develop a financial plan.” ADVICE FOR 2020: “The saw-tooth pattern we’ve seen in the stock market this year is typical of a late-cycle environment where uncertainty surrounding policy and mixed messages about the economic expansion’s sustainability cause stock and bond market sentiment to swing strongly between pessimism and optimism. We recommend developing an investment strategy based on your financial plan and on how one expects the economy and market to play out over the next 6-18 months, adjusting course if the preponderance of the data indicates that it is necessary.”
Industry trends to watch THERESA E. CHACOPULOS, senior vice president and private wealth advisor, Morgan Stanley Private Wealth Management: “With the new generation of investors, it’s time to think
differently about advice and bring new expectations to the industry. You need to seek new ways to engage with new clients, manage client relationships and manage risk.” SCOTT PORTER, partner and executive vice president of wealth management, Bennett & Porter: “Achieving true portfolio
diversification for our clients begins with understanding the latest technology and investment funds, such as blockchain and cryptocurrency. The need for good advice will continue to increase and be valuable for those looking to plan for a secure retirement.”
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WEALTH MANAGEMENT
Sherry Hall, CFP, AIF Certified Wealth Strategist Hallmark Financial hallmarkfinancial.net
BACKGROUND: Hall and her team have multiple registrations and professional designations and have more than 35 years of experience in the financial services industry. Their focus is working with individuals and business owners in the areas of retirement income, estate and tax planning and wealth management strategies. TREND TO WATCH: “We are in uncharted territory. With historically low interest rates, it’s a true challenge for a retired investor looking for his or her investments to provide a living cash flow. A treasury bond maturing in 10 years will pay an investor 1.5 percent, meaning a million dollars could pay $15,700 per year, whereas in 1989, you could get 9.49 percent, or $94,900 interest per year on the same million. That just illustrates that producing a durable income stream is a much bigger challenge than it used to be. The first impulse is to take bigger risks to stretch for higher yields, but therein lies the trap for those not aware of risk of loss outside of the stock market. Add in healthcare costs rising at double the inflation rate and people living longer and longer, and it’s what I call a perfect storm.” ADVICE FOR 2020: “Do not be complacent. Have a plan for your particular phase of life, know what your investments are and how much risk you are taking. With our comprehensive view of clients’ wealth, we take risks commensurate to not only the returns and volatility we can expect, but the time frame for each pocket of money. Then when the headlines read ‘market crashed today,’ you should only ask, ‘What’s for dinner?’”
Industry trends to watch DILLAN MICUS, executive vice president, AXA Advisors Southwest: “The Baby Boomers continue to have the biggest impact on our business today. The demand for our services has never been greater, but the supply of qualified financial professionals has never been less. Meaning, the Baby Boomer generation continues to retire, sell their businesses or pass away — all three of these events are money in motion where they need the help of a financial advisor.” JIM STARK, CFP, CIMA; president and managing partner, JRS Wealth Management Group: “2020 is setting up to be a
challenging year for a variety of reasons. The coming election will only add to the volatility. Prepare yourself ahead of time by having an investment discipline in place that will help sift out the noise of the events of the day and guard your emotions as an investor. Having a disciplined strategy in place will keep you from being both complacent and overreacting.”
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2019
Banking trends and issues to watch in
2020
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BANKING
ROB SCHWISTER, Phoenix Metro Market president, Alerus:
By MICHAEL GOSSIE
W
e are looking at a radically transformed banking industry heading into 2020 thanks to FinTech, consolidation, digital-first banking, and continuous innovation. We even saw a credit union buy a bank in Arizona this year. Yet, despite the constant disruption, the banking industry remains almost universally optimistic, despite some lingering question marks. “We will be heading into an election year so anything can happen,” says Todd Gerber, WaFd Bank Arizona commercial manager. “Headwinds include a continued tight labor market with unemployment in Arizona at 4.9 percent; increase in minimum wage to $12 in January 2020; and trade war and increased tariffs with China causing additional uncertainty among business owners. “Conversely, tailwinds — or positive — factors include long-term interest rates remaining low (since August 2019, the 10year treasury has been below two percent); advances in technology continue to drive efficiencies for the business community; inflation remains relatively low; and domestic net migration to Arizona continues to be a positive factor due to lower cost of living,” Gerber says. So what can we expect out of the banking industry heading into 2020? Here’s a snapshot of what some of Arizona’s leading banking experts say we can look forward to in 2020: 92
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“The industry is very healthy, so I see expanded investment in new technologies that will make it easier for people to do business with us.”
DON H. GARNER, CEO, Alliance Bank of Arizona: “Based on research Alliance Bank of Arizona shared during our 2019 Economic Forum, we’re seeing strong growth heading into 2020. Positive employment figures and continued growth in Arizona’s key industries, including both commercial and residential real estate, healthcare and tourism, are also leaving our clients optimistic about 2020, which is exciting to hear as their business-banking resource.”
h g an C P M or
ase &
Co.:
s and e i r t s u nd rio i nd their a v r midd o f n r i e g mana panies itions, expa ings and /or m egion r o , c T l R AE t loca ake acquis new build elping our a N AC K e A r G g E y m M h rk wit help them ational), bu cash flow. H o w e p to “W ern peed u my job.” ntinue stic and int s o c o t l l ’ we (dome ury platform est part of s t n i r p foot treas als is the b r i e h t CANDACE HUNTER WIEST, go de upgra hieve their president and CEO, West Valley National c a s t Bank: “I continue to be concerned n clie ing, J t b a nk e k r a us le m
MIKE BROWN, president, WaFd Bank Arizona:
“Our industry’s success will continue to be tied to how we not only react, but how we anticipate and proactively put effective plans, procedures and processes in place. In general, I think all Arizonans will adapt accordingly and we will ride a wave of prosperity at least through 2020.” DAVE RALSTON, CEO, BOK Financial: “The outlook for the banking industry heading into 2020 looks promising, but not without its challenges. Bank earnings will benefit from tax reform and rising interest rates, but will be muted by rising costs of technology and regulatory compliance. These escalating costs — along with proposed regulatory reforms — could accelerate consolidation in the industry.” MICHAEL J. THORELL, president and CEO, Pinnacle Bank, which was acquired by Arizona Federal Credit Union earlier this year: “We continue to share the hope that we will see reasonable regulatory reform which will result in a positive experience for both the industry and our clients.”
about the possibility of a mild recession. Hopefully, the Fed will continue to sit pat with interest rates. The recent increases have significantly impacted some of our small businesses. And the housing market seems to have slowed in the markets we serve, which include Arizona, Southern California and Las Vegas. I do not expect any meaningful regulatory relief.”
JEFF FRIESEN, president of the Arizona Region, Enterprise Bank & Trust: “I believe the banking industry will remain healthy in 2020. However, the biggest disruption will be due to the fast growing technology space — FinTech. While expansion in technology, within the financial sector, will continue to be very creative, it creates issues within the current regulatory world, which will need to be addressed.”
JIM S. PATTERSON, president and CEO, UMB Bank Arizona: “We are fortunate enough to have experienced continuous growth in Phoenix. We are excited to continue to grow our business while supporting our clients in reaching their goals, whether that be for growth and expansion or preparing for succession.”
Dave Ralston
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BANKING
BANKING ON THE FUTURE Here’s how Arizona is becoming a national leader in financial technology
A
rizona’s emergence as a technology hub is no longer a secret. Our growth has been covered in The New York Times, Inc., Forbes, The Wall Street Journal and other national publications across the country. The combination of a pro-business/pro-technology state government, the low cost of living and the combination of large technology companies with a promising startup ecosystem have made Arizona the perfect place for innovation.
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One of the reasons Arizona has elevated itself in the national innovation scene is because of the emergence of financial technology, or FinTech. The primary driver occurred March 2018 with the passing of HB 2434, which made Arizona the first state to enact a regulatory FinTech “sandbox� that allows emerging companies in FinTech, including blockchain and digital assets to grow their respective innovations without stringent regulations. The program grants companies in these industries the opportunity to grow their businesses for up to two years or gain up to 10,000 customers before needing to apply for a formal license. Because Arizona was the first state to openly welcome the development of FinTech, we have a distinct competitive advantage within this space. This is important, as FinTech is among the fastest-growing technologies to date. According to a 2017 global FinTech report, AB | November - December 2019 97
BANKING 77 percent of financial service institutions expect to adopt blockchain and other FinTech applications by 2020, and FinTech adoption is projected to result in increased revenue of up to 20 percent. Leading the way Since Arizona enacted its FinTech sandbox, Utah, Wyoming and Nevada have also developed their own versions, but Arizona’s program provides the most freedom. Unlike other states, Arizona allows companies from out of state to participate. This has allowed Arizona to offer the most attractive program for successfully recruiting new companies, furthering the potential to grow this technology sector. In fact, in 2017 the BBC News reported that Arizona is even beginning to overtake New York in the financial sector. From March 2016 to March 2017, hiring for finance and insurance jobs grew faster in Arizona than any other state in the country.
To date, Arizona has welcomed eight companies into the program, including Align Income Share Funding Inc.; Enian Ltd., Verdigris Holdings Inc.; Omni Mobile Inc.; Grain Technology Inc.; Wisetack, Inc; Zona Digital Commodity, LLC, and Sweetbridge NFP Ltd. The Arizona attorney general’s office, which is responsible for oversight of the sandbox, and groups like the Arizona Bankers Association are also actively marketing the sandbox to draw more FinTech companies to the Valley. “The FinTech sandbox is still in its infancy, but we are already seeing a lot of interest from startups locally and across the nation who want to test their ideas,” said Paul Hickman, president and CEO, Arizona Bankers Association. “I believe we will see the program lead to a substantial influx of innovation in Arizona’s financial sector.” One industry that will be heavily impacted by FinTech innovation is the banking sector. Many banks around the
THE FINTECH SANDBOX Arizona’s FinTech sandbox allows participants to temporarily test-drive their products, engaging in certain financial services activities under regulatory supervision without undertaking the costly process of securing traditional licenses prior to operation. The Arizona sandbox is designed to allow innovative ideas to get to market more quickly by reducing “one-size-fits-all” regulatory requirements in exchange for more active involvement by the Attorney General’s Office. It’s not a license for participants to do whatever they want, but it is meant to provide a dynamic arrangement where the regulator and participant can observe what’s happening in the market and make adjustments as needed regarding monitoring and regulatory compliance at the state level. The Arizona Attorney General’s Office is responsible for the admission process into and oversight of the sandbox.
country are watching Arizona’s program to see which innovations can be leveraged to improve their financial services. Banking industry benefits “We believe one of the greatest opportunities that will arise for startups graduating from our sandbox program will be opportunities for investment from banks,” said Evan Daniels, FinTech Sandbox Counsel for the Attorney General’s Office. “The sandbox allows companies to put their ideas into action for investors to take notice.” Verdigris Holdings Inc., one of the program participants, is addressing the high cost of identity assurance, which prevents mainstream banks from servicing low- to moderate-income individuals by developing a low-cost, safe, efficient technology, as well as a proprietary operating process. The sandbox gives Verdigris an opportunity to test and develop its technology while simultaneously applying for a bank charter. This is a key example of how the sandbox is shaping the future of the banking industry. Outside the sandbox, Arizona’s progrowth legislation has allowed several other Arizona FinTech companies to thrive with their own innovations. BillingTree is a prime example. For more than 10 years, BillingTree has been developing FinTech applications that accompany traditional payment processes. Some of these applications include interactive voice response systems, virtual terminals and portals. Other leading Arizona FinTech companies include Nexus Earth, AmCheck, Keap and PayTech. Arizona’s FinTech industry is an excellent example of why our state is making waves in the national and international technology sector. Rather than limiting technology growth through restrictive regulations, our government has shown a willingness to open its doors to new ideas and provide companies with the tools to test them. As we continue to grow, the mindset of the government and leaders in our community will put Arizona in the right place for success. Steven G. Zylstra is president and CEO of the Arizona Technology Council.
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BANKING
2020 WISH LIST
Here’s the legislation, reform, or regulatory relief banking leaders would like to see in the coming year By MICHAEL GOSSIE
A
fter a period of regulatory overload, the banking industry has received some relatively good news in recent years when it comes to regulatory relief. “Dodd–Frank was necessary when it was enacted in the wake of the financial crisis,” says Paul Hickman, president and CEO of the Arizona Bankers Association, “but it was an over-reaction.” The Dodd–Frank Wall Street Reform and Consumer Protection Act is a federal law that overhauled financial regulation in the aftermath of the recessions of 2007–2008. It was a sweeping overhaul of the United States financial regulatory system, a transformation on a scale not seen since the reforms that followed the Great Depression. Some critics argued that the law had a negative impact on economic growth and smaller community banks. Many Republicans called for the partial or total repeal of the law. “The banking industry got some regulatory relief from Senate Bill 2155, which is actually 10 times the size of Dodd-Frank,” Hickman says. Senate Bill 2155 — also known as the Economic Growth, Regulatory Relief and Consumer Protection Act — was signed into federal law by President Donald Trump on May 24, 2018. The bill eases regulations imposed by Dodd-Frank by raising the threshold to $250 billion from $50 billion under which banks are deemed too important to the financial system to fail. The bill also eliminated the Volcker Rule — which prohibits banks from conducting certain investment activities with their own accounts and limits their dealings with hedge funds and private equity funds — for small banks with less than $10 billion in assets. 100
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RELIEF IN HAND And that’s not the only relief the banking industry has received recently: • The Government Accountability Office found that the Federal Reserve and other regulators had influence over the behavior of banks in a way that is subject to congressional oversight. At least in theory, the agency’s decision will make it easier for Congress to relax regulations that were imposed after the 2008 financial crisis. The GAO’s opinion marked the latest victory in a campaign by Republicans and the Trump administration to ease constraints on banks. With a new law and a series of changes to capital requirements and trading restrictions, they have already made substantial progress. • The Federal Reserve recently adjusted key bank regulations put in place after the financial crisis — imposing regulations so they are more closely to bank size and reducing the necessary level of cash and government bond stockpiles at all but the largest banks. Affected banks will also be allowed to submit “living wills” — documents detailing how a bank would wind itself down in the event of failure — less frequently. Banks with $250 billion to $700 billion in total assets will now have to submit a resolution plan every three years, alternating between full and partial filings. They are currently required to submit a full report annually. But Hickman says there is still work to do in terms of easing the regulatory burden. “The Bank Secrecy Act (BSA) — also known as the Anti-Money Laundering (AML) law — has not been reformed since the 1970s,” Hickman says. “The act requires financial institutions to file reports for deposits that exceed $10,000 and report suspicious activity that may signify money laundering, tax evasion, or other criminal activities. We would like to see that threshold raised from $10,000 to $65,000. But we would be happy to see it raised to at least $35,000.” As an alternative or complement potential changes to the BSA, Hickman would like to see a program for cash-intensive businesses that would operate similarly to a “TSA Fast Lane” when it comes to banking, making it easier for those businesses to work with banks, while lowering the amount of paperwork for banks. BIG BUSINESS “One of the biggest pieces of legislation that we are cautiously optimistic will soon become law and have a major impact on the banking industry is the SAFE Act, which was recently passed by Congress,” Hickman says. The Secure And Fair Enforcement (SAFE) Banking Act aims to ensure that state-authorized and regulated cannabis businesses are not forced to operate with cash only. Under the proposed law, financial institutions would be provided with a federally approved safe harbor to serve not only retail cannabis stores, but the vendors and service providers that serve those stores — plumbers, carpenters, cleaning companies, etc. “What the law would do is tell banking agencies that if cannabis is legal under state law, it cannot penalize the bank for doing business with cannabis companies,” Hickman says. AB | November - December 2019 101
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“Right now, federal laws and regulations are a roadblock to banks in Arizona doing business with a multi-billion-dollar industry. Right now, banks cannot take deposits from cannabis businesses without strict scrutiny and the risk of those accounts being closed. The SAFE Act would end that problem.” While the SAFE Act is generally applauded by the banking industry, experts say it needs to be precise when and if it is enacted. “The SAFE Act could be a blessing or a curse,” says Candace Wiest, president and CEO of West Valley National Bank. “It should not be so vague that it assists people who have no business banking cannabis customers. And it should be so clear that the regulatory agencies know exactly how to supervise the banks that are qualified to offer this business line.” If the bill wins approval by the U.S. Senate, then President Trump, it will become law.
would allow Arizona’s businesses to continue driving the state’s economic momentum forward through expansion and reinvestment.” • Heather Higginbottom, president, JPMorgan Chase PolicyCenter: “JPMorgan Chase is advancing a public policy agenda through the new JPMorgan Chase PolicyCenter that reduces barriers to employment for people with criminal Jack Barry Don Garner backgrounds. Businesses must play a critical role in advocating for policies that unlock economic opportunity for more people in underserved communities. By working with political, business and community leaders, we will help advance public policy solutions that drive inclusive growth at all levels of government.” • Dave Howell, regional director for Arizona government relations, Wells Fargo: “Wells Fargo supports efforts at the Consumer Financial Protection Bureau to revise the Paul Hickman Heather qualified mortgage regulatory framework to Higginbottom ensure continued, equal access to mortgage EXPERT OPINION credit for consumers and to minimize any With regulatory relief on the horizon and market disruption.” optimism in the banking industry, here’s • Patrick Strieck, head of retail banking what other industry leaders would like to see for the Arizona Region, BMO Harris Bank in regards to legislative help in the coming NA: “BMO is hopeful that there will be year: meaningful changes to the current federal • Jack Barry, chairman and CEO, Enterprise anti-money laundering regime in 2020. The Bank and Trust - Arizona Region: “There current system is outdated and inhibits our are still aspects of the Dodd-Frank ability to efficiently serve our customers. legislation that was hurriedly put into place Proposed legislation in both the House and Dave Howell Patrick Strieck after the 2008-2010 downturn that has Senate would enhance our ability to identify created unintended consequences. Although there bad acts and monitor for potential AML violations, were clearly abuses that occurred in the financial while at the same time increasing the efficiency of the markets pre-downturn, the corrective measures overall framework allowing us to reallocate valuable undertaken within the consumer mortgage industry time and resources that is better spent serving our and regulatory reporting requirements has placed customers.” an undue burden on the banks and has caused some • Wiest: “A down cycle usually leads to asset quality unnecessary restrictions in credit offerings. The issues. When that happens, Congress tends to ride voluminous and often redundant mortgage disclosure in and shoot the survivors. They will cry for more and qualifying rules have made it difficult at times to rules, more regulations, etc. And in the past, the provide efficient delivery of mortgage loan products. rules did not distinguish between $50-billion banks Candace Wiest Also, the level of regulatory oversight since Doddand $500-million banks. Any new regulations Frank has substantially increased costs associated should be reviewed to make sure it is relevant to the with excessive reviews and submissions of information to the community banks. Community banks serve rural areas and small respective agencies.” businesses. We make SBA and USDA loans so people can grow • Don Garner, CEO, Alliance Bank of Arizona: “We hope that their businesses. During the last recession, we learned that small any legislation, reform or regulatory relief implemented in 2020 businesses are critical to the American economy. One-size-fits-all affecting the banking industry will help financial institutions regulations hamper the community banks’ ability to serve the bring a broader array of lending capability to customers. This small businesses in this country.”
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2019
50 YEARS OF ADVOCACY A look at how Arizona Forward has protected and shaped the state’s environment
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ARIZONA FORWARD 2019
50 YEARS
of impact
Here’s a look at the events that helped Arizona Forward shape our state’s environmental landscape
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By MICHAEL GOSSIE
A lot happened in 1969.
Richard Nixon was sworn in as the 37th president of the United States. Led Zeppelin’s first album was released in the United States. An estimated 500 million people worldwide watched Neil Armstrong become the first man to walk on the moon. And out of a meeting of two organizations in Arizona would spring a group that would go on to mobilize business leaders and policymakers to leverage their collective power to best grow our communities, stimulate our economy, enhance our environment, ensure smart growth and development, improve air quality, develop responsible water management, create energy alternatives and foster meaningful education. That group was Valley Forward. Today, now called Arizona Forward, the group is celebrating 50 years of impact on the Grand Canyon State. Here are some of the milestones that helped make Arizona Forward an environmental force at age 50:
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1969 On Tuesday April 22,1969, Valley Forward Association is born from a joint meeting of two organizations — Central Phoenix Progress Association and Valley Beautiful Citizens Council. Its first executive director is Frank Bosh. Later that year, the organization drafts legislation to create the Rio Salado Development District.
The Rio Salado project takes off and becomes a feature in the Valley Forward annual report.
Valley Forward supports the Valley-wide “Project Pool It” initiative to encourage car and van pooling.
1969 1970 1972 1973 1974
1976
1981
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Valley Forward continues the Rio Salado project with participation of the City of Phoenix Beyond the Banks initiative.
Valley Forward supports the unsuccessful ValTrans proposition for elevated high-speed rail.
1986
Valley Forward Valley Valley Forward initiates the spearheads the Environmental Forward Government Excellence Awards Mall project to program. supports guide future development in the Phoenix. concept of the Central Phoenix Plan to Valley Forward created the Rio sustain the Salado Steering Committee, which is spearheaded by James Elmore, “Central chairman of the committee and the Corridor.” “Father of Rio Salado.”
Dan Devers becomes Valley Forward’s second executive director.
Valley Forward initiates the Great Salt River Clean-Up, Arizona’s largest volunteer effort involving thousands of residents. Later that year, Valley Forward advocates for limiting emissions from mobile sources through implementation of vehicle emissions testing and publishes the first Urban Form Report Card.
“Think big – think small.”
Valley Forward joins City of Phoenix officials to dissuade Gov. Bruce Babbitt from constructing a state office building outside the mall area.
1979
1993
Valley Forward participates in creating a five-year action plan for building as many miles of freeway as possible. It is named the largest effort to expand Arizona highways. Later that year, Valley Forward develops a preamble consisting of specific areas of interest and in return creates the slogan:
1988
1989
BARBARA CROWELL becomes Valley Forward’s new executive director.
1991
1993
DIANE BROSSART becomes Valley Forward’s executive director, a position she goes on to hold for 26 years.
1995
1998
Valley Forward supports the sales tax initiatives for freeways and transit.
1999
2000
Valley Forward continues its advocacy for open spaces, including Phoenix parks and preserves.
Valley Forward supports the Transit 2000 Regional Transportation Plan for Phoenix and begins advocacy for light rail transit in the Valley.
2013
Valley Forward officially transitions to a statewide organization and begins operations as Arizona Forward. Nina Mason Pulliam provides a grant to help with the statewide expansion. Arizona Forward also supports the “green out” for the Waste Management Phoenix Open.
Valley Forward recruits 12 Valley mayors to sign a proclamation initiated by Valley Forward and the U.S. Green Building Council, Arizona Chapter in support of green schools. And in a major move, Professor Nan Ellin transitions the Canalscape project from ASU to Valley Forward. Valley Forward celebrates the Grand Opening of the Phoenix Rio Salado. Valley Forward’s EarthFest Education Grant for K-12 teachers, which provides funding to support environmental projects in their classroom, is also announced.
Valley Forward publishes the second edition of “Making the Grade: The Valley’s 2008 Environmental Report Card.”
Valley Forward provides input to the Maricopa Association of Governments TPC on a regional transportation plan for the Valley.
2001
2003
Valley Forward creates Friends of the West Valley Recreation Corridor with WESTMARC. Later that year, Valley Forward holds a forum on electric utility deregulation.
2004
2005
2007
2008
Valley Forward partners with ASU to sponsor Al Gore’s live presentation of “An Inconvenient Truth.” Valley Forward also launches an interactive website and prints 100,000 passports to promote the Valley’s Pedestrian Freeway.
2009
Valley Forward produces and distributes two primers focused on energy and parks. Valley Forward also advocates for the Land and Water Conservation Fund by sending support letters to President Barack Obama and Arizona’s Congressional delegation.
2010
2011
2012
Valley Forward releases a statewide primer on transportation issues to drive Arizona’s economy. Valley Forward also copresents State Parks Day at the Arizona Legislature and holds a news conference about funding challenges facing Arizona’s parks.
Valley Forward commemorates 40 years of environmental advocacy in the region by planting 40 trees in Downtown Phoenix with Mayor Phil Gordon and other project partners.
THIS IS A BIG YEAR FOR THE ORGANIZATION: • Arizona Forward produces and This is another big year publishes a Healthy Forest Primer. for the organization as • Arizona Forward participates in Lori Singleton is named the Grand Canalscape project’s executive director and $10.3 million TIGER grant and the Arizona Forward initiates project earns support from Nancy the Emerging Leaders Pelosi and Ruben Gallego. Arizona program, hosts the first Forward also supports Scottsdale’s Statewide Sustainability canal transformation. Summit and hosts the Autonomous Vehicle • Arizona Forward supports Stand Forum. Up 4 Transportation to enhance quality of life for Arizona.
2013
2014
2015
Arizona Forward also publishes “Valuing Arizona’s Water: The cost of service and the price you pay.” In addition, Arizona Forward brings a delegation of business leaders to Washington D.C. to demonstrate support for the I-11 International Corridor.
2016
Arizona Forward places a strong effort to preserve, restore and strategically manage Arizona’s precious rivers.
2017
2018
2019
Intel, ASU and HDR share their insight for sustainability with Arizona Forward members and Liberty Wildlife receives Arizona Forward’s President’s Award at the Environmental Excellence Awards.
2019
In addition to celebrating its 50th anniversary, Arizona Forward hosts a breakfast to educate members on the Lower Basin Drought Contingency Plan. To top it off, Arizona Forward hosts its first forum to hear mayoral and Districts 5 and 8 candidates’ views on sustainability issues.
Erin Brockovich attends Valley Forward’s 35th Annual Luncheon and the association publishes “Making the Grade: The Valley’s 2004 Environmental Report Card.”
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A FLUID OUTLOOK Efforts from Arizona Forward, forward-thinkers create reasons to be optimistic about Arizona’s water future By ERIN THORBURN
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rizona Forward is committed to water. As Arizona’s oldest environmental advocacy group, Arizona Forward has a water committee made up of more than 60 people tied to various organizations — including cities and counties from across they state. Together, these individuals and organizations explore every facet of our desert’s most precious commodity — water. From exploring how water plays a role in industry operations and recreational uses to seeking the most innovative and progressive sustainability and conservation methods, Arizona Forward honors and supports the champions of Arizona’s future water planning. Arizona Forward’s 2019 Environmental Excellence Awards reflected that focus as the group honored several water-related projects, including the Governor’s Award for Arizona’s Future, which was presented to Arizona’s Drought Contingency Plan Process (DCP) and committee cochairs. After months of collaboration and compromise, the DCP plan details how impacted stakeholders, including 114
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Arizona and other states, will adapt to reductions on Colorado River water to secure water supplies for Arizona residents. YOU DOWN WITH DCP? The DCP is not a singular solution, but it is one essential cog in Arizona’s long-term plan to protect the future of our water. “With the Drought Contingency Plan in place, we have some certainty about what to expect if Lake Mead’s level continues to decline,” says Ted Cooke, general manager of Central Arizona Project (CAP). “Since the DCP lasts through 2026, we have some time to put the next program in place with the other six Basin States.” Although some wonder if Arizona’s water conservation and sustainability efforts will see our desert state through the next five decades, the DCP is one of many examples of what the state has successfully accomplished when it comes to water planning. A new higher tier level – Tier Zero – triggers reductions in water supplies to users. Lake Mead is expected to drop to Tier Zero in 2020 and 2021. Prior to the formal adoption of the DCP, Arizona had been conserving water in
WATER CREATES ENERGY: The Mormon Flat Dam forms Canyon Lake on the Salt River. The dam contains two hydroelectric generating units. (Photo courtesy of SRP)
Lake Mead at Tier Zero levels since 2016, according to Cooke. “Now that DCP is in place, Arizona and other Lower Basin states stored an additional 600,000 acre-feet in Lake Mead — in 2019 alone — all because of the new rules regarding access to Intentionally Created Surplus (ICS) under DCP,” Cooke adds. To give it some perspective, an acre-foot is equivalent to 325,851 gallons of water. A key piece of the DCP requires states and water suppliers to “bank” water in Lake Mead, where Arizona’s share of the Colorado River is stored. It’s working – so far. The lake is 22 feet higher than expected. Almost half of that was due to storage and contributions to system conservation. The rest came from heavy snowfall in the Rockies. But Arizona’s proficiency in planning — even perhaps initially unintentional — reaches back significantly farther than the creation of the DCP. “Our statewide demand for water is slightly lower than it was in the mid 1950s, although our population has more than doubled during that time period,” says Sethuraman Panchanathan, executive vice president of Arizona State University’s Knowledge Enterprise. “And currently, we AB | November-December 2019
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are using slightly less water than we did five decades ago. What this tells us is that there is hope moving forward.” “We live within the water supplies we currently have and have also managed to store millions of acre-feet underground,” adds Cooke. “Our consumption today is about the same as it was 60 years ago, even though the population is nearly seven times larger and the economy is nearly 25 times as big.” Moving forward, DCP stands as a historic and valuable precedent of collaboration between states. It will also serve as an integral component of Arizona’s future water supply. Cooke describes the initiative as another step in the long list of difficult water-related challenges that have been successfully addressed by Arizona. This includes the authorization of the CAP in 1968, the passage of the Groundwater Management Act in 1980 and the creation of the Central Arizona Groundwater Replenishment District (CAGRD) in 1993, among others. “Arizona has a long history of careful groundwater management in the state-designated Active Management Areas (AMAs) pursuant to the 1980 Groundwater Management Act, as amended,” says Sharon B. Megdal, director of the University of Arizona Water Resources Research Center. “Over 80 percent of the state’s population lives in an AMA. Since the mid-1980s, we have carefully integrated Colorado River water into Central Arizona’s water portfolio.” “Because we live in a desert, we must take these bold and creative steps,” Cooke says. “We have no choice. These challenges are getting harder, but because of our extensive efforts over the years, we continue to get better at it.” BOUT OF DROUGHT According to Dave Roberts, associate general manager of SRP’s water resources, Arizona has been in a prolonged dry period for nearly 25 years. Drought is not a foreign concept in an arid environment, but it’s helpful to understand the additional challenges it presents to our state in particular. Since the bulk of Arizona’s population resides in Maricopa and Pima counties, 116
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rainfall alone is not sufficient to sustain a densely inhabited desert climate. Thus, fossil/groundwater and renewable water sources are essential. “Before CAP was here in the early 1970s and brought fully online in the 1990s, we had an overdraft of water,” Cooke says. “It’s
quite a bit different now, but the challenge with groundwater is certainly not over yet.” Despite the drought and associated challenges, Arizona’s water systems have been able to accommodate the needs of its occupants. “Nowhere else in the country does a
WATER STORAGE: The Granite Reef Underground Storage Project includes water from the Salt and Verde rivers, Central Arizona Project water via the South Canal, and reclaimed water via a pipeline from the Mesa water reclamation facility. (Photo courtesy of SRP)
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major metropolitan area possess a water supply that is as resilient to such long, dry periods,” Roberts says. “Drought cycles of 20 to 30 years are normal for our arid region. Based on tree ring studies that look back nearly 1,000 years, we know that these extended drought periods also include ‘spike years,’ such as 2019, when SRP’s total reservoir system storage climbed from 56 percent to 80 percent in one winter.” Past efforts in water conservation and management have positioned Arizona for a hopeful future when it comes to water, but experts collectively agree that remaining vigilant and forward-thinking must remain a priority. “I think we all agree that we cannot rest on the laurels of our past accomplishments,” Megdal says. “Instead, we must chart our water-course forward. We face challenges going forward that are as diverse as our state’s communities and geographic features.” “We need to plan ahead, be proactive, and seek entrepreneurial solutions,” adds Panchanathan. “If we continue as we are today without any changes, we won’t have
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the quantity of water we need. And, we must ensure that in addition to having the quantity of water we need, that we also have the quality. Challenges come about when we think about the safe and quality water supply we need going forward.” SMART WATER PLANNING Potential Arizona water issues ahead are as complex as they are varied. With fluctuating climate variables, challenges in forest-water management, water-produced energy needs and quality concerns regarding reusable water, how do Arizona’s researchers and thought leaders plan to address these elements? “Although we have significant challenges, we also have the capacity to find solutions,” Panchanathan says. “One of which is the compilation of a congressional committee designed with the priority of finding collaborative, innovative and collective ways to address short- and long-term water needs.” Beyond congressional collaboration, Arizona exemplifies continuity in caring for the future of water in several areas. Again, this is a fact not lost on Arizona
Forward. One of this year’s Environmental Excellence Awards went to Gila River Indian Community Mar 5 Interpretative Trail, which gives visitors a chance to learn about the traditional uses of native plants to the area and about the importance of the Gila River to the Akimel O’otham. “The Pima-Maricopa Irrigation Project partnered with Hunter Contracting to construct a quarter-mile-long, concretelined ditch to deliver a portion of the Community’s Colorado River (CAP) water into the Gila River to be stored for a future day when there will be surface water shortages,” says Stephen Roe Lewis, governor of the Gila River Indian Community. “The first water was released into the Gila River on August 24, 2015. Since that time we have stored over 45,000 acre-feet in the river downstream of the MAR 5 Gila River Interpretive Trail.” Arizona Forward also recognized the efforts of UA, ASU, Northern Arizona University, and the National Forest Foundation (NFF) for their ongoing initiatives in water sustainability. “The University of Arizona has a long history of performing cutting-edge
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research related to water quality, water quantity and engaging with and educating communities throughout the state,” Megdal says. “UA faculty and staff have been highly engaged in researching the safety of food grown in Arizona, the quality of our water supplies and understanding hydrologic systems, as well as working to understand how the built environment can enable greater water use efficiency.” SPIRIT OF COLLABORATION ASU is helping to spearhead several water conservation and sustainability initiatives, many of which are innovative and technology-driven. This includes a proposed Water Resilience Center to bolster hydrology to the schools of humanities, engineering, economics and more, as well as resources like the Virtual Water Security Decision Support Tool to understand, model and predict water systems under future extremes, and a Drought-Proofing Manufacturing Hub to support water-aware business growth and value of water as raw material in product development. “At ASU, we conducted a survey of corporate water users in Maricopa county,” Panchanathan says. “Seventy percent reported that water was critical to their business. However, they also stated that they did not understand the true cost of water usage beyond their water bill. This means we need to get these industries
Ted Cooke
Rebecca Davidson
Sharon B. Megdal
Sethuraman Panchanathan
Dave Roberts
Stephen Roe Lewis
WATER HITS HOME “Each year, we host a summit on human dignity,” says Bob Ryan, principal at Brophy College Preparatory, a Jesuit school. “We focus on a different topic each year and this year water is our emphasis … Recently, the Jesuits announced four apostolic preferences, which serve as priorities for all Jesuit works for the next 10 years. One of these preferences is
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together to discuss water practices.” To address some of the challenges associated with forest areas such as the Lower Salt River, UA is helping to champion the Lower Salt River Riparian Restoration Project in an effort to protect water supplies by reducing the risk of fire, flood, sedimentation and erosion within the watersheds. “The NFF has teamed up with the Tonto National Forest, Northern Arizona University, Intel, SRP’s Trees for Change program, Boeing, Arizona Audubon, Arizona Forward and Salt River Tubing to launch a broad program of work to begin restoration of the Lower Salt River,” says Rebecca Davidson, director of the Southern Rockies Field Program for the National Forest Foundation. “In doing so, we are leveraging a range of interests and opportunities — from measuring the volume of water replenished, the number of trees planted, increased diversity in birds and wildlife, and connecting communities and youth to the values of natural resources and being outdoors.” Along with the spirit of collaboration, Arizona has what all experts agree is an exceptional infrastructure in the state to support smart water planning for the next 50-plus years. The key to continued success is leveraging existing relationships, celebrating bipartisan congressional support and continuing to work smarter and harder.
the ‘Care of Our Common Home’ and this is one of the reasons we are focusing our summit on water.” In addition, Brophy’s Fine Art Department will participate in the 2020 Phoenix Mural Festival, which is focusing on the area of the canals between 7th Avenue and 7th Street. Local artists will be hired by property owners to create murals with a theme of sustainability and highlight the canals popularity as a resource for exercise and recreation.
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GROWTH MODE Arizona Forward’s Emerging Sustainability Leaders program helps develop new generation of leaders
By ERIN THORBURN
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elebrating its 50th anniversary, Arizona Forward is already grooming the next generation of leaders who will help usher the organization through its next 50 years. Launched in December of 2018, Arizona Forward’s Emerging Sustainability Leaders program is cultivating local stewards in sustainability business leadership. The program is geared toward early to mid-career professionals who have been identified for their leadership potential. Participants in the pilot class were selected for their commitment to sustainability; capacity to integrate sustainability into their organization; interest in being a long-term influencer in Arizona’s sustainability initiatives; and the capacity to take on a new challenge. The selection process resulted in a balance of participants from government, nonprofit and business organizations. “As we celebrate the 50th anniversary year of Arizona Forward, our members saw an opportunity to grow leaders who could merge sustainability and business goals to steward our resources as we head into the next 50 years,” says Lori Singleton, president and CEO of Arizona Forward. “Cultivating and equipping these next-generation leaders today will fill a niche in practice-based sustainability learning.”
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Eager recipients of the Emerging Sustainability Leaders program infuse their learned sustainability knowledge back into the organizations from which they were nominated — as well as within their local communities. Everyone wins and everyone embraces greater environmental understanding and, in many instances, compassion. REFLECTING VALUES “The Emerging Leaders program was designed to expose everyone to the full spectrum of Arizona’s foremost environmental concerns — clean power, clean air, clean water,” says Gina Durante, program manager for Salt River Project’s School of Energy. “Each month, we focused on one of these sustainability topics. The beauty of the program is that globally relevant issues are presented from the perspective of Arizona’s civic and business leaders, which also happen to be member organizations of Arizona Forward.” Durante was nominated by her manager, Gary Blanchard, who works in strategic energy management for SRP. Additional nominators include Michael Marquess, founder and CEO of Mother Road Brewing Co.; Laura Canaca, division coordinator
of information, education, recreation and legislation for Arizona Game and Fish; and Phoenix Mayor Kate Gallego, among others. When asked why she felt Blanchard selected her for the Emerging Sustainability Leaders Program, Durante explained that it was likely due to her passion for sustainability, education and helping others. “I educate on sustainability every day as one of the program managers for the SRP School of Energy program,” Durante says. “The School of Energy is an interactive partnership between SRP and elementary schools that engages students, educators and communities in energy education and conservation.” Durante’s passion for both learning and sharing insight into sustainability is shared by current program participants, as well as last year’s program nominees. DEEP-ROOTED INTEREST “I’ve been interested in circular economy for a while, but I only recently learned it had a name,” says Trevor Root, emerging sustainability leader and civil engineer for HDR. A circular economy is an economic system aimed at eliminating waste and the continual use of resources.
“I grew up on a small farm and my dad worked at a steel scrap yard, so we repurposed nearly everything we could while I was growing up,” Root says. “It’s only recently that I’ve learned how critical it is for our economy and environment that everyone practices these types of circular economy principles as part of our daily lives. I’m currently promoting circular economy education and office composting as the champion of HDR’s Phoenix office Green Team.” During the eight-month program, selected Emerging Sustainability Leaders program participants meet once a week and travel to various locations in the state. During their time together a lesson plan is developed, with the ultimate goal of preparing future generations to lead the way in sustainability. Graduates and current nominees gain exposure to a wide spectrum of real-time sustainability topics from experienced industry leaders. “It’s one thing to learn something, but to actually see it in practice really sticks to you,” says Andrew Iacona, project manager for Northern Arizona University. “While all of the tours were very impressive and noteworthy, I particularly enjoyed the tour of the Ocotillo Intel facility and am sure that this experience will be etched in my mind for years to come.” AB | November-December 2019
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Gina Durante
Andrew Iacona
Kate Gallego
Trevor Root
Lori Singleton
Iacona explains that whether it is a tour or weekly educational sessions, the continuity of learning yields valuable results. LESSONS LEARNED “There was an underlying theme to each of the lessons that blended together — an approach to ensuring that sustainability was on the agenda at each of the organizations we heard from,” he says. “My key takeaway is that this was done by packaging and delivering the material in a way where you clearly know how sustainability fits in your organization by knowing your organization’s needs and knowing your people.” Advocates and educators in environmental sustainability agree that connectivity is essential. Not only in educational messaging, but in linking like-minded thought leaders. “By connecting emerging leaders who have an interest in integrating sustainability practices in their respective fields with expertise, training, and a strong network,” says Gallego. “Arizona Forward helps to encourage cross-sector collaboration to lead our state into a more sustainable future.” Gallego explains that while many organizations offer onetime events that provide forums for sustainability-focused discussions and training, Arizona Forward provides continued investment in each year’s nominees and networks that will last a lifetime. “Today’s emerging leaders have the drive and desire to make their communities more sustainable,” Gallego says. “Arizona Forward helps to provide them with the tools, information, and relationships they need to succeed.” 124
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EMERGING SUSTAINABILITY LEADER SPOTLIGHT Emerging leader Oliver Adams, director of people and culture for Mother Road Brewing Company, helped launch the “Conserve and Protect Kölsch” campaign. Nominated for the Emerging Sustainability Leaders program by Michael Marquess, founder and CEO of Mother Road Brewing Co.; and by Laura Canaca, division coordinator of information, education, recreation and legislation for Arizona Game and Fish; Adams helped initiate a sustainability effort to benefit the Arizona Gaming and Fish Department. Through 2020, when a case of Kölsch beer is purchased featuring a limited-time specialty label, $1 is parceled to the wildlife conservation and preservation fund of the Arizona Game and Fish Department. “I was nominated to the Emerging Leaders program because I’ve expressed my career goal to make a meaningful impact in sustainability,” says Adams. “In joining the Emerging Sustainability Leaders Program, I hope to build relationships with other leaders who are passionate about sustainability, gain a better understanding of the sustainability challenges that Arizona faces and learn how I can contribute to the solutions for those challenges.”
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Environmental Excellence Awards Arizona Forward showcases the state’s progressive efforts toward sustainability and improving our environment By MICHAEL GOSSIE
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t’s not often that an organization can celebrate 50 years of impact. But Arizona Forward did just that with this year’s prestigious Arizona Forward Environmental Excellence Awards presented by SRP. “The gala was a special evening and we were proud to honor some very important projects,” said Lori Singleton, president and CEO of Arizona Forward. “There were many project nominations related to water this year, which shows how focused the Arizona community is on this vital resource.” The President’s Award, the top honor of all project submissions, was given to Mar 5 Gila River Indian Community Interpretative Trail. A collaboration between the Gila River Indian Community, Pima-Maricopa Irrigation Project, Neil & Young Associates and Hunter Contracting Co., worked on the Managed Aquifer Recharge Site 5 (MAR 5) and Interpretive Trail giving Gila River Indian Community
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members a sustainable way to provide water for farming, materials for artisans to carry on their crafts, and educational classes to teach future generations after decades of being dried up land. The Governor’s Award for Arizona’s Future was presented by Anni Foster, general counsel for Gov. Doug Ducey’s office. The Crescordia Award, the highest honor within each category, went to Arizona’s Drought Contingency Plan (DCP) and the committee co-chairs. Tom Buschatzke, director with the Arizona Department of Water Resources and Ted Cooke, general manager with Central Arizona Project, worked together as DCP committee cochairs and accepted the award. Here are the recipients of the other Crescordia Awards: • Private Sector Sustainability Champion — Intel Corporation: Intel has committed to restore 100 percent of the company’s global water use through collaborative
projects that restore water to watersheds that benefit communities. The corporation has funded 10 projects in collaboration with nonprofits to support Arizona watersheds. Once completed, these projects will restore about 650 million gallons of water to the environment each year. • Public Sector Sustainability Champion — City of Scottsdale, Scottsdale Water: The Choose Tap! awareness campaign aims at increasing consumption of tap water as a safe, affordable alternative to bottled water. In three months of operation, the City’s water trailer has distributed 11,575 gallons of water, equivalent to 74,054 onetime use water bottles. • Buildings and Structures, Civic — Salt River-Pima Maricopa Community Justice Center, Gould Evans: The SRPMIC center is a tribal court and practitioners’ building located on 4.3 acres of Indian Community land. Redefining traditional judicial
AWARD WINNER: The Bob & Renee Parsons Leadership Center for Girls and Women at Camp South Mountain earned Arizona Forward’s Environmental Excellence Award for Buildings and Structures, Commercial & Institutional. (Photo courtesy of Weitz)
Scouts, a supportive place for girls to develop skills and foster community, and an example of sustainable desert development. AWARD WINNER: The Salt River-
Pima Maricopa Community Justice Center earned Arizona Forward’s Environmental Excellence Award for Buildings and Structures, Civic. (Photo courtesy of Gould Evans)
• Site Development and Landscape, Landscapes and Preserves — MAR 5 and Gila River Interpretive Trail, Hunter Contracting Co.: The trail gives Gila
River Indian Community members a sustainable way to provide water for farming, materials for artisans to carry on their crafts, and classes to teach future generations not only about their heritage but also how to carry on the farming and artisan traditions.
environments, while considering the natural landscape, was an essential goal for the tribal members and design team alike. • Site Development and Landscape, Landscapes and Preserves — Lower Salt • Buildings and Structures, Historic River restoration project, National Forest Preservation — City of Phoenix Parks and Foundation: The purpose of this project is Recreation, Band Building Steele Indian to restore an 11-mile stretch of the Lower School Park: On the National Register of Salt River by removing exotic plant species, Historic Places and just west of Memorial planting over 500,000 native plants, and Hall, this project was a partnership with developing educational and volunteer the City of Phoenix Parks Department opportunities. the Native American Connections and the • Healthy Communities, Public Policy/ Phoenix Indian Center. The 6,000-squarePlans — sustainable action plan for county foot space was transformed into a space operations, Pima County Government: The for education and reflection. The new plan’s purpose is to address the climate space is intended to help educate people challenges of today. The Plan is an expansive unfamiliar with what the park used to be. and multi-faceted initiative, covering nine different sustainability focus areas. • Buildings and Structures, Commercial & Institutional — the Bob & Renee • Art in Public Places — 7th Avenue Parsons Leadership Center for Girls and Streetscape, Canary, a Gould Evans Studio: Women at Camp South Mountain, Marlene The 7th Avenue Streetscape is a rotating Imirzian & Associates Architects: The public art exhibition comprised of six project reflects the values of the Girl large existing panels that regularly feature
local Phoenix artwork. The narratives focus on sustainability to increase public awareness for reuse, recycling and social consciousness. • Technology Innovation — Arizona Water Watch, Arizona Department of Environmental Quality: The program applies innovative ideas through multilevel volunteer opportunities ranging from sending information and photos through a mobile app to collecting weekly water samples. It has consolidated answers from over 15,000 questions and 1,800 photos submitted through the mobile app and produced outstanding results. • Environmental Education & Communication — 2019 Ten Across Water Summit, University City Exchange at Arizona State University: The Interstate-10 corridor provides the most compelling window on the future of the country, one which presents the challenges of the 21st century in the highest relief. Ten Across engages this region as a living laboratory for resilience and innovation. • Waste Reduction — City of Mesa Household Hazardous Materials Facility: The facility collects items such as cleaners, automotive fluids, pool chemicals, tires, and appliances to keep materials from contaminating the environment, landfills, wastewater treatment plants, and solid waste vehicles. Approximately 30 percent of all materials collected for disposal are in good enough condition to be reused and are placed into the “Swap Shop,” where Mesa residents can shop for free. AB | November-December 2019
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