VOL. 37, NO. 41
OCTOBER 10 - 16, 2016
Source Lunch
Business of Life Bar 32 has quickly become a favorite for Hilton. Pages 34-35
GOVERNMENT
The List
CLEVELAND BUSINESS
Melissa Ferchill discusses the highs and lows of real estate. Page 36
Largest colleges and universities. Page 39
FINANCE
Budish is Gap narrows in battle for your bucks putting Huntington gets NEO jolt priorities in order By JEREMY NOBILE
New data from the Federal Deposit Insurance Corp. shows which banks are gaining — or losing — control in the deposit market. These stats are based on FDIC data as of June 30, but were tweaked by Crain’s to reflect changes in the Cleveland and Akron MSAs not yet factored by the FDIC, namely Huntington Bancshares’ acquisition of FirstMerit Corp. These numbers show Huntington’s combined market share, less a block of deposits sold to another bank as required by regulators in the merger itself.
By JAY MILLER
Cleveland market share, in percent
jmiller@crain.com @millerjh
As he first promised when he took office in January 2014, Cuyahoga County Executive Armond Budish is broadening the way the county approaches its role in creating jobs and expanding the county’s economy. “Economic development and job creation are really a top priority for us here at the county,” Budish said in an interview last month with his development director, Ted Carter. “We are prioritizing economic development in a way that I think has never before done.” Though traditional economic development — the lending and financial incentive programs of the county’s development department — is only 3% of the county’s $1.5 billion 2016 county budget, Budish puts much more under the county’s job creation umbrella. “A lot of people think of economic development as loans to support a development that builds a building,” he said. “I think ours is a broader view but I think it’s the right view.” Last month, county council approved a new five-year economic plan that will guide how the county works to create jobs. The plan largely incorporates Budish's belief that everything from lending the city of Euclid $4 million to create a more inviting waterfront in that Eastern suburb to helping struggling county residents build a stable career path that leads off public assistance, are part of the county’s effort to build the county economy. SEE BUDISH, PAGE 33
KeyBank
23.29%
Huntington Bank (FirstMerit)
13.89%
PNC Bank
13.62%
Citizens Bank
11.87%
Third Federal
8.61%
Fifth Third Bank
5.97%
Chase Bank
5.53%
U.S. Bank
3.2%
Dollar Bank
2.65%
NYCB/Ohio Savings Bank
2.61%
Akron market share, in percent Huntington Bank (FirstMerit) Chase Bank
33.7% 13.06%
PNC Bank
11.4%
KeyBank
8.26%
Fifth Third Bank
5.92%
Citizens Bank
4.42%
Third Federal NYCB/Ohio Savings Bank
3.51% 3.13%
U.S. Bank
1.88%
Portage Community Bank
1.70%
Crain’s 2016 Entire contents © 2016 by Crain Communications Inc.
10%
Source: FDIC; Crain’s reporting
20%
30%
jnobile@crain.com @JeremyNobile
New data from the Federal Deposit Insurance Corp. help validate what the banking market already knows: Huntington Bank is stretching its legs both in this region and across the entirety of Ohio. According to recently updated FDIC numbers, Huntington is the second-largest bank by deposits in the Cleveland MSA — trailing only Cleveland’s KeyBank — and a dominant force in the Akron MSA, reflecting a surging presence throughout Northeast Ohio in the wake of Huntington Bancshares’ recent acquisition of Akron’s FirstMerit Corp. And while there are more deposit dollars in the local and state markets overall — particularly in Akron, where deposits grew a solid 8.2% from the prior year — the gaps between competing banks here clearly are narrowing. “It’s a very competitive market,” said Charlie Crowley, a managing director at investment bank Boenning & Scattergood, Inc. “It’s safe to say that all of these folks are sort of fighting it out day to day for deposit and loan market share.”
In Ohio, Huntington is actually No. 2 Huntington’s acquisition expands its asset base by 34% to $100 billion. When the merger was announced earlier this year, the combined company was expected to grow to the largest in the state in terms of deposit market share, according to the most current numbers at the time, leapfrogging Fifth Third Bank and U.S. Bank, respectively, to take the top spot. U.S. Bank, though, grew its Ohio market share by 3 percentage points SEE BANKS, PAGE 38
CFO of the Year profiles.
Pages 17-32
PA G E 2
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CRAIN’S CLEVELAND BUSINESS
lcoutre@crain.com @LydiaCoutre
Increased blood vessels and swelling in the scan of a brain cancer patient who has undergone radiation treatment could be the effects of radiation or a recurring tumor. Clinicians can have trouble differentiating between the two conditions, which have far different treatments. In an effort to help diagnose these visually indistinguishable images, researchers at Case Western Reserve University created a computer program that can more accurately read those same magnetic resonance images (MRI), according to a new study. The program model, dubbed NeuroRadVision, obtained an accuracy of 80%, while radiologists in the study looking at the same scans the computer analyzed had accuracy rates roughly around 50%, said Pallavi Tiwari, assistant professor of biomedical engineering at CWRU and leader of the study. The direct comparison was part of a feasibility study published last month in the American Journal of Neuroradiology. The team will present the new technology later this month in Columbus at the Ohio Collegiate Venture Showcase, an event highlighting successful work from the I-Corps@ Ohio, an initiative of the Ohio Department of Higher Education. The program aims to help faculty and graduate students at Ohio universities validate the market potential of new technology and launch startup companies. NeuroRadVision is able to zoom into the pixels, densities and minute details of the same scan clinicians OH_2016_Crains.qxp_Layout 1 9/30/16
MRI scans of patients with radiation necrosis (above) and cancer recurrence (below) are shown in the left column, with close-ups in the center column. A computer program created by researchers at Case Western Reserve University can help to discern between the indistinguishable images. The images on the right show what this program is able to analyze, showing the subtle differences between the effects of radiation and returning brain cancer. (Contributed photo by Pallavi Tiwari)
Tumor reccurence
By LYDIA COUTRÉ
Radiation necrosis
Case program could ID recurring tumors
look at, said Anant Madabhushi, professor of biomedical engineering at CWRU and the study's co-author. The human eye is capable of appreciating only a certain degree of differences, he said, while the computer can identify and capture subtle variances. “And therefore, you’ve got sort of a quantitative interpretation, as op11:18 AM Page 1
posed to a qualitative interpretation — which is what the radiologist does and does well — but unfortunately, it doesn’t always work when you’ve got very, very subtle differences between pathologies,� said Madabhushi, who also directs the Center of Computational Imaging and Personalized Diagnostics at CWRU. The program, intended to be used
as an additional diagnostic aid, could mean avoiding a brain biopsy procedure, currently the only definitive test to determine whether abnormal tissue on a brain scan is radiation necrosis (dead brain cells caused by radiation) or returning brain cancer. “Instead of having to operate to say, ‘Oh, you have radiation necrosis
or you have a recurrent tumor,’ we could spare them that and then be able to direct their treatment based on whichever one it is,� said Lisa Rogers, CWRU neurology professor and medical director of the Neuro-oncology Program at University Hospitals Cleveland Medical Center. Rogers, also a co-author on the paper, said she “definitely� sees NeuroRadVision’s direct applications for patients and hopes to be able to use the technology in the future. Although the study focused specifically on scans of brain tumors following radiation treatment, Madabhushi said he expects that further studies will find applications to both other tumors as well as to other treatments. Brain tumors often are a classic example of the challenges in distinguishing radiation effects, but it remains an issue across the board in cancer, he said. Using the computer program to augment the decisionmaking progress could be a big help. To develop NeuroRadVision, the researchers used machine learning algorithms along with radiomics, or the features extracted from images via computer algorithms. Madabhushi and Tiwari’s work began about three years ago after conversations with neuro-oncologists and neurosurgeons at UH, who said one of the biggest problems they face is distinguishing between benign radiation effects and tumor recurrence. The work that followed is a “wonderful example� of where the biomedical engineering and computational imaging fields meet the clinical side to realize and solve clinical conundrums, Madabhushi said. “It’s been an interesting journey,� he said. “I think we’re happy and proud of what that has achieved.�
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PA G E 3
Realty buyer Dan Siegel turns developer By STAN BULLARD sbullard@crain.com @CrainRltywriter
After building an apartment portfolio over the last 20 years through acquisitions, Dan Siegel is moving into ground-up construction to create his own multifamily growth opportunities. What’s more, it’s not just one project, but four at disparate sites. In the largest and likely to remain the most high-profile project, Siegel’s Beachwood-based Integrity Real Estate Group has joined Andrew Brickman’s Warrensville Heights-based Brickhaus Development Inc. project to construct about 300 apartments on a Lorain Avenue site near West 20th Street, within walking distance of downtown Cleveland, Ohio City and Tremont. Both developers confirmed they formed a partnership to pursue the multimillion-dollar development of the site overlooking the city’s Flats and downtown. However, Siegel's most controversial project, with the most likely strikes against it, involves participating in a partnership with owners of a 20-acre site at Solon Road and Erico Drive in Solon that hinges on voter approval of a ballot issue next month to rezone the property to multifamily from commercial. The push to develop 197 apartments on the Aurora Road site has Siegel and his partners hiring former Cuyahoga County commissioner Lee Weingart’s LNE Group to operate its campaign for a project that is bitterly opposed by area residents. Meanwhile, Siegel is expanding Ashton Place apartments, 179 Meadowcreek Drive in Wadsworth, by adding 12 suites to a 48-suite community. Through SP Wadsworth LLC,
Dan Siegel and his partners need voter approval to develop 197 apartments on a 20-acre site in Solon. (Contributed photo)
Siegel bought the formerly lender-owned existing four-building development and additional vacant land near Interstate 76 for $950,000 in 2014, according to Medina County land records. When all the land is developed, Ashton Place will have 112 two-bedroom suites that rent for upwards of $1,050 monthly. In Parma, Siegel’s firm is adding 40 suites to the 500-unit Reserves, at 1150 O’Malley Drive. The expansion adds single-family home style apartments on previously vacant land on the site.
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Meeting demand The movement into development is a reaction to the current dynamic market for selling apartments to investors. “Most of my portfolio is in rehabilitated properties,” Siegel said. “We still do a few hundreds units of that a year. However, there’s a lot of competition for rehab properties. It squeezes the profit out of the project. Doing ground-up developments creates opportunity.” Michael Barron, first vice presi-
dent in apartment sales at Marcus & Millichap, agreed the competition for apartments is intense. “We’re getting 10 to 15 offers for every apartment building we list that is well-priced and well-located,” Barron said. “I’ve sold a lot to (Siegel) through the years. He looks sometimes, but other times he won’t. He says, ‘I don’t want to spend my time going to look at it. You will get more than I am willing to pay for it.’ But (Siegel’s) still finding deals.” The other side of the dynamic is that Siegel appreciates what a singu-
lar time this is in the multifamily realty space and the risk the market may get overbuilt. “Ground-ups only make sense at these low interest rates,” Siegel said. “If interest rates double, that shuts the door. I absolutely worry about apartments becoming saturated. You’d be a fool if you don’t have that in the back of your mind. It depends on your crystal ball. But we wouldn’t be there if we didn’t believe in the potential. These may compete for the same renter by price range, but not in SEE SIEGEL, PAGE 6
PA G E 4
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CRAIN’S CLEVELAND BUSINESS
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More and more local colleges and universities are introducing so-called meta-majors to try to help undecided students find a middle ground between feeling forced to pick a specific major and signing up for a bunch of unrelated general education classes. Instead, these meta-majors or academic pathways group a school’s majors into broad categories that students can choose based on their interests. But it’s more than just letting students explore an interest area and pick their specific major later. These programs are structured so students aren’t likely to take extraneous classes that won’t end up counting toward a degree. At Cleveland State University, the goal behind the meta-majors is to improve graduation and retention rates, said Peter Meiksins, vice provost for academic programs. If a student isn’t making progress at a school, he or she may leave, he said. And not making progress doesn’t have to just look like failing. It can also include taking classes that don’t apply to a chosen major. The aim of meta-majors is to make sure students aren’t starting “in the wrong direction too sharply,” Meiksins said. This move toward meta-majors or career/academic pathways is far from just a local trend. Complete College America, an Indianapolis-based nonprofit focused on increasing degree and certificate completion, has been promoting the meta-majors and guided pathways approach as an effective strategy, said Dhanfu E. Elston, the group’s vice president for alliance state relations. And when states join its alliance, like Ohio has, he said the group expects they will adopt those advocated strategies. Elston said colleges and universities across the country are at a “tipping point” for adoption of meta-majors. It’s especially important to help under-represented students make decisions about their majors, he said, and schools such as community colleges, regional colleges and minority-serving institutions that often serve such students are moving toward this model. Meiksins said Cleveland State began its meta-major programs this year, starting with two disciplines: business and engineering. A core curriculum was essentially already in place in those programs, he said, so the university just had to formalize it. In the meta-majors, students take a set of common classes their first semester in their chosen discipline, as well as an “Introduction to University Life” course. The university is now working on the second phase of meta-majors to be implemented next fall for the areas of humanities, social sciences, fine arts and pre-education, Meik-
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sins said. The sciences will be last, because it’s more difficult to create a generic first semester. Meiksins said that may get split into health and physical science. This approach doesn’t work for all students. Some have too many credit hours from AP or dual enrollment for it to make sense, Meiksins said, and others are entering into programs like nursing, which has rigid requirements. At Lorain County Community College, the meta-majors are called program and career on-ramps, said Jonathan Dryden, interim provost and vice president for academic and learner services. The college began offering nine in disciplines including business, manufacturing and health and wellness this year. The programs allow for “structured exploration” for students who have a general idea of the field they want to enter after graduation. It lets them experiment without earning too many credits outside of their interest area, Dryden said.
Some concerns Overall, faculty have been supportive, though some have expressed concern that the structure of the programs takes away student choice, he said. But Dryden said the programs themselves aren’t changing; the socalled on-ramps show students how
“It’s really about structuring their choices.” — Jonathan Dryden, interim provost and vice president for academic and learner services, Lorain County CC
to get from point A to point B in a non-overwhelming way. “It’s really about structuring their choices,” he said. Cuyahoga Community College has also identified nine meta-majors or academic pathways in areas including creative arts, business and public safety. The school will support the programs with technology, using its website to help students see different options within their chosen discipline. Lisa Williams, Tri-C’s vice president of learning and engagement, said the college would be offering a new online catalogue next fall, which will show the common courses students can take that would apply to a variety of programs within each pathway. Students will also be able to visit a page on Tri-C’s website to learn more about the different degree, certificate or professional development options under that meta-major. Those pages are already set up for manufacturing and IT, Williams said, and pages for all the disciplines should be available next fall. Davis Jenkins, senior research asVolume 37, Number 41 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 441131230. Copyright © 2016 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373. Reprint information: 212-210-0750
sociate with the Community College Research Center at Teachers College, Columbia University in New York, said meta-majors or academic pathways “force and help students” to explore a field, but should also outline for students what job and future education opportunities are in that field. The programs also let students start networking, he said. Jenkins said the next wave will be extending these pathways into high schools, perhaps through dual enrollment programs. In addition to Cleveland State, LCCC and Tri-C, there are a number of schools in the area that may not be implementing a new meta-majors program but have been running programs with similar goals. Take Kent State University, for example. The undecided option went away for students in recent years. Instead, students entering the university without a defined major have to pick an area of interest to explore under the Exploratory Advising Center, said Nicole Kotlan, director of the center. Students in those areas of interest take a first-year experience course together, as well as an applicable co-registered course, and have guided action plans to work on as they explore. But the program doesn’t include a framework of set classes beyond those two. John Carroll University takes a slightly different approach. The school focuses on individual advising for students, instead of creating structured pathways. In John Carroll’s Boler School of Business, students do take foundational courses that intentionally expose them to different parts of the field, said Brian Williams, the university’s vice president for enrollment. Youngstown State University offers something similar in some of its programs, namely engineering and business. Provost and vice president for academic affairs Martin Abraham was involved in the creation of this process for the engineering program about five to six years ago, as he was then the dean of the college overseeing it. While the outcome is the same, the reason the program came about is almost the opposite of why meta-majors are being introduced today. Youngstown State had historically offered a general engineering major, Abraham said, and was looking to move to discipline-based majors, so students could major in specific types of engineering such as electrical or mechanical. But there was some push-back from those who wanted to make sure the program still gave students a general engineering foundation. Without that foundation, if a student started out pursuing one specific type of engineering and switched to another, there was a danger the courses wouldn’t transfer. That could cost the students time and money. “It’s just not an efficient way to do it,” Abraham said. Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan, 48207-9911, or email to customerservice@crainscleveland.com, or call 877-8249373 (in the U.S. and Canada) or (313) 446-0450 (all other locations), or fax 313-446-6777.
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CRAIN’S CLEVELAND BUSINESS
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The Solon apartments Dan Siegel’s team are hoping to build have drawn the ire of many. (Contributed photo)
SIEGEL CONTINUED FROM PAGE 3 terms of location. I know the markets, but at the end of the day it’s a guess.” Siegel already appreciates the difficulty of the developer’s role. “When you buy an existing apartment complex and rehabilitate it, people are happy,” Siegel said. “When you do ground-up apartments, no one’s happy. There are more politics to it.”
On the ballot Unhappy, indeed. In Solon, Siegel and the land owners, Nathan Lancry and Marc Jacobson, took the rezoning to multifamily from commercial directly to the voters by initiative petition. They skipped the exercise of trying to win city council OKs for putting it on the ballot. Siegel and his partners have gone door to door and are doing several mailings to registered voters. Asked how much they will spend by Nov. 7, Siegel said, “It’s substantial. I try not to remember.” Siegel’s group will need to find some magic to win. No Solon city official has endorsed the ballot measure, and some public officials outright oppose it. A vocal and active critic of the Solon ballot issue is Mark Haas, a retired social worker and home inspection business owner whose Pepper
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Drive home sits 2,500 feet from the Siegel group’s site. “We expect to defeat this at the city and ward level,” Haas said. “It’s going to lose the ward in a landslide and fail by 70% in the city as a whole.” (For the rezoning to go into effect, Solon requires it to pass at both the ward and city levels.) Haas is treasurer of Citizens Against Rezoning Solon, a political action committee with more than 100 members. “We’re putting up hundreds of signs,” Haas said. He argues the project is spot zoning and would not wind up as a luxury rentals because the rents will have to fall as the project will go between a factory and Sedlak Interiors with busy State Route 422 nearby. He maintains millennials and empty nesters the developers say the project will attract are not likely tenants, for Solon has too little nightlife for millennials. “And what empty nester whose house is paid for who has to just pay taxes and utilities to stay there want to sell and live in an apartment the size of my garage,” Haas said.
Filling a void For his part, Siegel notes that aside from the Carrington age-restricted community, the newest apartments in Solon date from 20 years ago. “People who work in Solon have to go to Beachwood to find rentals like this,” Siegel said. “You have a lot of wealth, a lot of jobs in Solon, but not a lot of apartments.”
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The proposed $20 million development also has at least 40 fewer units than the site could accommodate, Siegel said, because the design keeps 60% of the site as green space. He said that is necessary because the project needs to be buffered from adjoining commercial uses to be attractive for luxury rentals. “This site has been empty 50 years,” Siegel said. “If it was a good commercial site, it would be developed by now.” However, Councilman Marc Kotora, whose Ward 4 the proposed project sits in, disagrees and opposes the measure. “It doesn’t make sense to turn it into a residential use. The developer should put offices there,” Kotora said. He said he also worries the ballot language has no provisions to control the size and type of apartment complex put on the site if voters should approve it.
‘The value of development’ By contrast, in Cleveland, Siegel has joined forces for a project that will receive 15 years of property tax abatements. “The city of Cleveland sees the value of the development,” Siegel said, and it wants density. Siegel said he signed onto the project because he has rentals in Tremont and Ohio City and knows they do well. Brickman said he opted to joint venture with Siegel rather than outof-town developers. “(Siegel) sees the site is spectacular and wanted to do a marquee project,” Brickman said. “He has tremendous experience, is well respected in the industry, has a great management company, is a real estate law and tax expert, and I like him.” Neither would disclose terms of their joint venture, but they hope to start construction in early 2017 on a first phase of the project called OneWestTwenty.
All in Besides building apartments, Siegel and business associate Rich Brown also have started investing in single-family homes as rentals and have a portfolio of hundreds of homes. Siegel said he is attracted to them by the returns they offer, which can be higher than in multifamily. Ralph McGreevy, executive vice president of Northern Ohio Apartment Association trade group, said the proliferation of developments fits Siegel’s personality. “Some people dip their toe into something when they first go into it,” McGreevy said. “(Siegel’s) not a toe dipper.”
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PA G E 7
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By STAN BULLARD sbullard@crain.com @CrainRltywriter
Rally House, a chain of sports boutiques based in Lenexa, Kan., is joining the lineup at three Northeast Ohio retail centers. The first of the stores opened Sept. 23 at The Shoppes at Parma, and the second debuted last Thursday, Oct. 6, at Macedonia Commons in Macedonia. The third store will open by month’s end at Westgate Shopping Center in Fairview Park, according to a news release from Rally House. Michelle Devlin, Shoppes at Parma general manager, said the Parma store is 4,300 square feet, and the stores can range as large as 6,000 square feet. Rally House emphasizes a range of sports apparel and gear related to local collegiate and professional baseball, basketball and football teams. The chain emphasizes fan engagement with local events, autograph sessions and ticket giveaways. It offers its own designs as well as licensed apparel. In an emailed news release by Shoppes at Parma, Aaron Liebert, Rally House CEO, said, “With the recent success of the Cavs and the Indians, it’s really exciting to be in Cleveland. We look forward to providing fans with a new shopping experience.”
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The Northeast Ohio stores give the chain six outlets in Ohio. The chain, part of the Liebert family-owned Sampler Stores Inc., began as a mail-order operation in 1989 called Kansas Sampler. It later migrated to the web, started opening stores in the 1990s, and now has 50 around the country.
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PA G E 8
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O C T O B E R 10 - 16 , 2 016 |
CRAIN’S CLEVELAND BUSINESS
Forest City sheds modular business
By STAN BULLARD
Initiative adds to kids’ options Center’s prep2practice software is now available in other fields By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre
sbullard@crain.com @CrainRltywriter
An executive with Cleveland roots as a home builder has acquired the modular building business of Forest City Realty Trust Inc.’s New Yorkbased unit, Forest City Ratner Cos. Roger Krulak, previously a Forest City senior vice president in New York who ran the company’s startup modular business, has acquired it through Full Stack Modular LLC. He said in a news release that he plans to offer turn-key solutions to developers of multifamily buildings, hotels and dormitories. Krulak is the son of Sandy Krulak, who operated Ameri-Con Homes in Beachwood, which the elder Krulak launched after running Forest City’s one-time homebuilding subsidiary. Roger Krulak worked for a time at Ameri-Con. He most recently ran the development of the modular process and plant that Forest City used to build 461 Dean Street, a 32-story apartment building in Brooklyn, N.Y. Mary Anne Gilmartin, president and CEO of Forest City Ratner, said in the news release issued by Full Stack that the sale allows Forest City to focus on its core strengths managing and developing properties. Gilmartin added, “We have always been firm believers in modular construction, and we are incredibly proud of the breakthroughs we’ve made.” Roger Krulak said the modular systems are more efficient and cost effective than conventional building as well as more sustainable. “Modular is the future of multifamily construction,” he said. A New York Times story about the sale quoted him as saying that Forest
Forest City Enterprises Inc. built the 32-story 461 Dean Street building in Brooklyn, N.Y., using a modular system it developed for the job. (Contributed photo)
City’s first project with the system worked out the kinks in the process. Terms of the sale were not disclosed. The deal included Forest City’s long-term lease for a modular factory at Brooklyn Navy Yard, its equipment, and intellectual property associated with the product. Although Gilmartin said the company continues to support the modular concept, its experience with it has not been pleasant. Rather than being built faster, 461 Dean Street took longer than expected to construct, a total of five years. The developer sued its contractor on the project and 50% partner in the modular business, Skanska USA. The two settled in 2014 by Forest City buying Skanska’s share in the panel firm for an undisclosed amount. The 181-suite building will open this fall. When Forest City sold a 77% stake in its Pacific Park, formerly Atlantic Yards, development in Brooklyn to China-based Greenfield Corp., it had to change course from the modular process. The new partner prefers conventional construction methods.
What began roughly a decade ago as a matching process for connecting high school students to job shadowing experiences in health care has transformed from a labor-intensive system of spreadsheets, phone calls and sticky notes to computer software now being rolled out in other industries. After a few years of fine-tuning, NEONI, the workforce initiative of The Center for Health Affairs, now is offering its prep2practice software to other fields: manufacturing, technology, the arts — “really any occupation or sector that you can think of,” said Pat Cirillo, vice president of initiatives and analytics for the Center for Health Affairs. As the program gained popularity with hospitals — reaching close to 2,000 students in its peak year — the center, an advocacy group for Northeast Ohio hospitals, began partnering with trade associations and employers to offer the connection tool throughout the region. Cirillo said the response from businesses and the counterpart associations in other industries, has been “quite enthusiastic.” The software can eliminate “a lot of the drudgery” of coordinating job shadowing by taking down the administrative roadblock. The software can offer a streamlined process by connecting different sectors, said Courtney DeOreo, director of the Regional Information Technology Engagement (RITE) Board, which advocates for IT career development. “There are a lot of people going out to the schools, and so part of it is that we just want to be as coordinated as we can and not inundate teachers,” DeOreo said.
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With the expanded sectors, Cirillo said she expects prep2practice to be able to reach 20,000 students a year in Cuyahoga, Lake, Summit, Medina, Geauga and Lorain counties. Megan Van Voorhis, chief operating officer for the Community Partnership for Arts and Culture, said she often gets calls from parents looking to learn more about career options for their son or daughter interested in a creative field, which doesn’t regularly see a lot of job shadowing opportunities. “Really the potential (is) to see what opportunities exist and what paths those folks that are in those positions actually pursued in order to get where they are today,” Van Voorhis said. Though still at an early stage in working with prep2practice, she said she expects a lot of interest in the arts community. For a $75 annual subscription, students will get up to three job-shadowing experiences as well as other support services. Within the next few months, Cirillo said the plan is to add tests and other interactive features to the front-end website to help students figure out what industries or careers they’d like to learn more about. Also down the line is a plan to assist students in finding local universities, certification programs or other steps they can take to pursue that career. “Our vision for this is pretty expansive,” Cirillo said, “because once the students are on this website, we want them to be able to do all sorts of career exploration activities — not just literally go to a location, although we think that’s the best thing a kid can do. There’s no substitute for that.” There is no other cost to employers or schools, unless the schools opt to pay that fee for their students, which several have. The service has been completely free and self-funded by the center in
previous years. But without revenue streams, it became challenging to make the necessary improvements. Berea-Midpark High School has been working with NEONI to pair its students in health care job shadowing opportunities for many years, said Jane Darrow, the school’s gifted services instructor. She’s hoping to secure grants or other funds to pay for students’ fees to use the service. If she’s able to do that, prep2practice would give her a one-stop-shop for pairing students with local experiences. “As this program grows and funding is more available, I would love to be able to use this so it will free me up to be able to address other needful issues,” Darrow said. Charging a fee ensures software maintenance and enhancements and also adds incentive for students to show up and attend multiple experiences, which is vital for students to find not just the career they are interested in but also those that aren’t the right fit, Cirillo said. The hope is that the fee will help make the system self-sustaining within three or four years. For those who can’t afford it, the Center for Health Affairs intends to offer sliding fees and “quite a large number” of scholarships as well as volume discounts to schools who pay for their students to use the service, she said. Although most of the Center for Health Affairs’ work is in the health care industry, branching out made sense, Cirillo said. Hospitals benefit when the region has a healthy economy. “We are hearing from not only our sector partners but certainly the employers themselves that their growth is limited by their ability to get a skilled workforce,” she said. “So the hospitals certainly don’t argue with our having a robust, employed, happy economic sector.”
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PA G E 10
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O C T O B E R 10 - 16 , 2 016 |
CRAIN’S CLEVELAND BUSINESS
Opinion From the Editor
Sports revolution started here with Palmer, McCormack
Editorial
For Portman U.S. Sen. Rob Portman has run the kind of campaign that political strategists will study for years, and not just because of the skillful way he has distanced himself from the Republican Party's presidential nominee. Portman has had the advantage of money in the race against former Ohio Gov. Ted Strickland, of course, but it's one he earned with hard work and superior organization. That hyper-competence has been a hallmark of Portman’s long political career, which before his election to the Senate in 2010 included stints as a congressman, as U.S. Trade Representative and as director of the Office of Management and Budget. Portman’s intelligence, steadiness and dedication to working hard on issues of importance to Ohioans — most notably on the heroin epidemic and the protection of Lake Erie — are why we believe he deserves another term in the U.S. Senate. In this odd political year, one of the more striking spectacles has been the support that some labor unions, including the Teamsters, Mine Workers and International Union of Operating Engineers, have directed to Portman after backing Strickland in previous races. (Strickland still has the support of labor groups including the United Auto Workers, the AFL-CIO and AFSCME.) The union support for the Republican is, in part, strategic; Portman has opened up big polling leads in what had been expected to be a close race, and labor, like any other interest group, stands to benefit from backing a likely winner. Portman also sponsored the Pension Accountability Act in October 2015, which the Teamsters, for one, support, though the union says its backing of the Republican is based broadly on his Senate record and not just on the pension measure. But it’s also a reflection of a belief that Portman, in polarized
political times, is a pragmatist who can work with Democrats, as he has with Sen. Claire McCaskill of Missouri on measures related to detecting, reporting and addressing opioid abuse. Portman wrote the Comprehensive Addiction and Recovery Act aimed at combating opioid abuse, which has struck hard at Ohio and other industrial Midwestern states. He’s also on the record now as opposing the Trans-Pacific Partnership — a position we don't entirely buy from the longtime free-trade advocate, but one that could be leveraged into pushing for improvements in any version of TPP that’s passed during the next administration. Portman set the tone in the race early, defining Strickland’s gubernatorial term as a failure of budget stewardship and economic leadership. The former governor hasn’t recovered. Strickland is a decent man who simply hasn’t been up to the task of taking a seat that would be critical for the Democrats to regain control of the Senate. Strickland is right about this, though: Last week, at an event in Columbus, he highlighted Portman’s avoidance of GOP nominee Donald Trump (whom the senator has endorsed but never mentions if he can avoid it) and said, “I believe in his heart of hearts, he knows that Donald Trump is totally unfit to be the president.” If there happens to be a Republican in the White House come 2017, we’d expect Portman to maintain the skepticism of Trump that he has displayed throughout his Senate campaign. Ohio voters have come to respect Portman for his knowledge, work ethic and decency — qualities notably lacking in the Republican nominee. He can continue to be effective in the Senate by building on those qualities and finding substantive avenues of cooperation with Democrats.
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CLEVELAND BUSINESS
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I grew up watching golf matches like they were football games. Back then, we only had three channels to pick from, so if NBC, ABC or CBS were showing a golf tournament, we were watching it. In my house, Arnold Palmer ruled. He was my dad’s favorite player. They had a lot in common. They both had western Pennsylvania roots and an unorthodox swing. They both gave every drive a whipping and had a killer short game. They were charming, humble and athletic. Working guys, like my dad, could relate to Arnie. Arnold was The King, and when he died last month, I sent an email to my dad, suggesting we raise an Arnold Palmer iced tea/ lemonade the next time we saw each other to celebrate a life well-lived. And what a life it was, and one with roots strongly tied to Cleveland and its business community. The eulogies and rememElizabeth McIntyre brances talk about Arnie's victories, his legion of fans, and his business acumen. Here’s the origin story you may not have heard. Palmer was a 24-year-old salesman from Cleveland when he won the 1954 U.S. Amateur in Detroit. He was only seven months out of the U.S. Coast Guard, which had stationed him in Cleveland in the early 1950s. But the Northeast Ohio connection that was the most meaningful was with a young lawyer from Cleveland who competed against Palmer during their collegiate golf days. Mark McCormack left his law practice to represent Arnold Palmer. Their partnership transformed sports into the business we know today. It would turn both men into moguls and lead to the creation of global marketing giant IMG, which was headquartered in Cleveland until 2010. It also established the elite athlete as a brand. Air Jordan shoes. Peyton Manning pitching insurance and satellite TV in commercials. The worldwide phenomenon that is LeBron James. All can trace their roots to Cleveland and the Palmer-McCormack partnership. In “Players: The Story of Sports and Money, and the Visionaries Who Fought to Create a Revolution,” which was released earlier this year, author and Wall Street Journal reporter Matthew Futterman writes: “If there is a single turning point in the transformation of sports, then Mark McCormack’s arrival on the scene is undoubtedly it. Before McCormack — who began a revolution when, in 1960, he convinced Arnold Palmer to hire him as his exclusive agent — the grand old men who ran pro sports believed the sports industry was about them. These were the blue blazers at the Royal and Ancient Golf Club of St. Andrews (known as the R&A), the green jackets at Augusta National, the bureaucrats at the International Olympic Committee (IOC), and the plutocrats who owned teams in the NFL or Major League Baseball. As far as they were concerned, the inefficiencies of sports were whatever prevented the maximum amount of money and power from flowing their way.” Sports Illustrated agrees with Futterman’s assessment. Back in 2004, as part of the magazine’s 50th anniversary, SI named IMG’s formation as one of the top 20 sports “tipping points” of the last half of the 20th century. Palmer once said, “The most rewarding things you do in life are often the ones that look like they cannot be done.” That applies to winning 62 times on the PGA Tour, racking up seven majors and winning 10 more times on the Champions Tour. And it applies to changing the face of professional sports, long ago, in Cleveland, Ohio.
Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Cleveland Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by emailing letters@crain.com. Please include your complete name and city from which you are writing, and a telephone number for fact-checking purposes. Sound off: Send a Personal View for the opinion page to emcintyre@crain.com. Please include a telephone number for verification purposes.
CRAIN’S CLEVELAND BUSINESS
Web Talk Re: Planned $60M Ohio City project I would love for (developers of the Snavely Group-led mixed-use plan) to create an artist network for affordable living, instead of typical turnover-buyers who don’t bring anything to the community. This can be a mixed-use of business professional and artists. — Jonathan Thomas
Re: Rx for Rx I agree with Kate Hubben, author of the Oct. 3 Adviser column "Finding the Rx for Rx," that the use and the cost of pharmaceuticals should be managed. I would also suggest that incorporating a wellness education program is key in empowering your workers to understand how they can avoid having to need the medications in the first place. We are an overprescribed society that is getting sicker instead of healthier. Whether it's high cholesterol, depression, pain, digestive disorders, heart disease, brain health, you can be the CEO of your own personal health and wellbeing by educating yourself on diet and lifestyle choices. — Gloria Treister
Re: RNC in CLE Thank you for the Sept. 25 story highlighting some of the many folks who successfully orchestrated the Republican National Convention. The RNC was a high-caliber undertaking with numerous potential pitfalls, and CLE came out of glowing! Much thanks to those mentioned (for their in-kind contributions) and to our entire city for providing support at all levels. The whole world saw the successful and vibrant hosting of a highly complex event. — Noel
Re: Crain's endorsement of Cleveland schools levy The city of Cleveland schools' GPA ranking No. 607 out of 608 Ohio school districts. (Dead last is Warrensville Heights.) The Cleveland teachers have voted to strike for more. Crain’s is urging the voters to renew the levy that the voters put through in good faith four years ago. Crain’s is also advising the voters that the road to good results takes time. If after four years of extra money from the levy the Cleveland schools check in with (this performance), it appears a levy extension is not the solution. If it were the solution Cleveland would not be No. 607. Four years ago the deal between the voters and schools was the voters give extra funds for better results. The results are in and the grade is "A" for the voters giving more funds and "F" for failure for the schools to improve. Next to dead-last is not moving the needle. —Jim Daniloff
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O C T O B E R 10 - 16 , 2 016
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PA G E 11
Personal View
Utility regulators must protect average electricity customers
GO TRIBE! AMERICAN LEAGUE CENTRAL CHAMPS
By DICK MUNSON and DEVIN HARTMAN
Ohio’s utility regulators may have been appointed by a conservative governor, who embraces free markets and competition, but that hasn't stopped them from considering giant subsidies to electricity companies. Regulators are supposed to be independent. They shouldn’t rubber-stamp sweetheart deals for the businesses they oversee. Why, then, is the Public Utilities Commission of Ohio even debating a $12 billion gift to FirstEnergy? That's what is currently on the table in the Buckeye State, where FirstEnergy has various multibillion dollar requests in front of the PUCO that could leave everyday Ohioans paying more than $300 more each year for their electricity. There certainly is no rationale for a bailout. The company made bad business decisions, such as investing in coal-fired power plants when the price of natural gas was falling. Rather than rely on subsidies that reward its bad management, FirstEnergy should focus on market developments and properly managing its assets. In July 1999, the state approved legislation calling for competition among electricity generators, which has led to lower rates and increased reliability. FirstEnergy originally supported that deregulation policy because its executives believed it could compete successfully against other suppliers and profit. Yet several FirstEnergy power plants are now uneconomic – largely because competitors are burning low-cost natural gas – so the utility giant wants to abandon deregulation, obtain subsidies, and return to the guaranteed profits from being a monopoly. Other than FirstEnergy and a select few entities with similar interests, there’s no support for the subsidy: Local manufacturers fear it will lead to higher costs, causing investment and jobs to leave the state; Ohio Consumers’ Counsel calculates residential customers will face significantly higher bills; free-market conservatives oppose government bailouts; and environmentalists feel subsidies will allow dirty and uneconomic power plants to continue spewing pollution. Market experts have also weighed-in, noting the deal is bad for Ohioans and would harm the electricity market. Economists, in particular, appreciate the power of markets and the dangers of subsidies. A new report from PJM Interconnection, the regional grid operator, explains that bailouts for older plants, like those FirstEnergy is seeking, destroy competition and prevent customers from getting the lowest prices and the cleanest energy. PUCO staffers suggest the bailout would provide benefits to Ohio. They argue, for instance, the subsidies would be used to modernize the grid, yet the company has not submitted, nor has the PUCO approved, a grid-modernization plan. FirstEnergy’s subsidy request has a long and sordid history. The utility originally wanted $4 billion to keep several of its outdated, uncompetitive power plants operating. Despite opposition from the state’s manufacturers and consumers, the PUCO approved that largess, only to have the Federal Energy Regulatory Commission overturn the subsidy because it illegally disrupted competitive electricity markets. The utility then asked for the same $4 billion, but without the promise to keep those power plants operating. It then decided to ask for another $4 billion just to pay down its debts. Amazingly enough, FirstEnergy then requested another $4 billion to keep its headquarters in Ohio, even though it had previously signed a long-term lease to do just that. The Ohio outcome will have national implications. One federal regulator suggested the Buckeye State is ground zero for electricity market debates. He declared the “out of market constructs” being advanced by FirstEnergy would distort price signals and lead to “a really, really unsustainable future.” Moreover, during this election season, pundits say Americans are frustrated with a political system they see as controlled by those who abuse their positions of power. Forcing people to pay billions of dollars to prop up a massive company fits neatly into that unfortunate picture. The PUCO has the chance to show its independence and protect average consumers, rather than subsidize a politically powerful electricity company. Ohio commissioners can demonstrate their conservative principles by advancing competition over bailouts, and markets over cronyism. Frustrated Ohioans will be watching. Dick Munson is director of Midwest Clean Energy for the Environmental Defense Fund. Devin Hartman is electricity policy manager and senior fellow for the R Street Institute.
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PA G E 12
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O C T O B E R 10 - 16 , 2 016 |
CRAIN’S CLEVELAND BUSINESS
The Dish: Susan Condon Love
Gibbs Butcher Block knows how to draw a crowd Every Saturday from noon to 4 p.m., on sleepy, rural East River Road in Columbia Township, there is a traffic jam. The congestion near Sprague Road is so inevitable and heavy, a police officer routinely is stationed at the intersection to ensure smooth traffic flow. What is the siren’s call to this particular corner in this small, picturesque town? Gibbs Butcher Block — and sausage. Lots and lots of sausage. More than 70 varieties to be specific, with such names as Campfire Trail (with nuts and sweet ingredients), SunDried Tomato Pesto Italian Sausage, Apple Bacon Pumpkin Sausage and, in honor of Halloween, Vampire Bratwurst (made with Great Lakes Nosferatu Ale and “secret ingredients”). That’s just the tip of the pig, so to speak. “Food is my thing. It always has been,” said Jim Dixon, owner of the store (formerly The Old Mill) since 1999, when he and a partner bought the long-established butcher shop and corner store from the Gibbs family. Dixon is now the sole owner. “I was never in retail,” he said, laughing at his long-ago step into ownership. The Columbus native previously worked as a chef and manager for Specialty Restaurant Corp., owner of such places as the 100th Bomb Group in Cleveland. “Gibbs always had significant business for being so remote,” said Dixon, who on a gorgeous October day sat at one of the half-dozen pic-
Susan Condon Love is a freelance writer who was an editor and writer at The Plain Dealer, The Las Vegas Review-Journal, the Savannah (Ga.) Morning News and The Annapolis Capital.
nic benches outside the store. “In the 1980s, this was primarily a meat market. When I bought the store, we had no idea what path, sausage-wise, it would take. There was a loyal clientele and a lot of potential.” For some reason — and it is unclear what spurred him to do this, he said — Dixon decided soon after buying Gibbs to make two specialty sausages, a mild Italian sausage and a hot Italian one. “Soon, we decided to put pepperoni and onions in bratwurst,” he said. “And then we thought, why not, instead of side dishes, just put ingredients directly into the sausage? “One of my workers mentioned that her mother always served apples with pork. So we made an apple sausage. It’s just sort of taken off from there.” The Sausage Saturday tradition — technically Saturday sausage sampling day — started when Dixon realized that people were more likely to buy different flavors if they could taste them ahead of time. “Some combinations are so odd
“Food is my thing. It always has been,” says Jim Dixon, owner of Gibbs Butcher Block in Columbia Township. (Susan Condon Love for Crain’s)
you’ve got to taste them,” he said. An average of 600 to 700 people show up every Saturday year-round to sample some 125 pounds of free sausage. “They eat them as fast as we can grill them,” said Dixon, laughing. Dixon does not advertise or market the sampling event. “Giving away 125 pounds of sausage is all the marketing I need to do,” he said. Some of the more memorable flavors include: Cheddar Apple Pie, Jack Daniels Bratwurst, French Onion Soup Sausage, Apple Cinnamon Sausage, Maryland Crabcake Sausage, Cannonball BBQ Shrimp Sausage, Jalapeno Cheddar Sausage, Meatloaf
with Garlic Redskin Mashed Potato Sausage, Hawaiian Pizza Sausage, Sweet Corn & White Cheddar Sausage and Carmelized Onion & Guinness Beer Bratwurst. Still not seeing something you might want to try? Read on. How about Kalamata Olive & Feta Cheese Sausage, Irish Whiskey & Smoked Cheddar Bratwurst, Bean Burrito Sausage, Huevos Rancheros Sausage, Honey Maple Raspberry Sausage, Maple Pecan Sausage or Spicy Bloody Mary Sausage? “You think of a fruit, and we have added it to sausage,” said Dixon. “Blueberries, apples, cherries — all of them taste incredible.” Sausage maker Brian Budik makes
all of the product on site. On average, the store produces about 2,000-plus pounds per week. “In the summer, it may be a little more than that,” said Dixon. The ingredients are bought in bulk as most of them are commodities such as rice and tomato sauce. The most consistently popular sausage flavor is Jack Daniels Bratwurst with Smoked Cheddar. “We sell about 180 pounds a week,” Dixon said, though his favorite variety is the French Onion Soup Sausage. The price of specialty sausages is $5.99 a pound, except the seafood sausages, which cost $7.99 or $8.99 a pound. Even though Gibbs Butcher Block has folks lined up on sausage sampling days, the tasty meats account only for about 25% of its business. Gibbs also operates as a small grocery store and sells other meat products, such as stuffed pork chops and Angus beef. “The majority of sales include steaks, pork and chicken,” said Dixon. “Logically, if you look at the prices, the sausage is $5.99 a pound and the steaks are $15 a pound. The majority of our income comes from our steaks and fine cuts of meat.” Despite the popularity of his products and his free-sample model, Dixon, who only lives 10 minutes away from the store, has no plans to expand. “It’s kind of fun just being here and doing this,” he said. “I’m just fine here.”
STONERIDGE PROUDLY CONGRATULATES
George Strickler along with the other nominees for CFO of the Year. We thank George for all of his contributions over the past 10 years. His dedication and commitment to our employees, shareholders and customers is greatly appreciated.
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PA G E 14
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CRAIN’S CLEVELAND BUSINESS
O C T O B E R 10 - 16 , 2 016 |
In search of ‘Who to Watch in Education’ candidates Crain’s “Who to Watch in Education” section, to be published on Dec. 5, highlights up-and-comers and innovators in Northeast Ohio’s education sector — whether in the classroom, in an administrative role or behind the scenes. If you know an education leader, email sections editor Timothy Magaw at tmagaw@crain.com. Please put “Who to Watch in Education” in the subject line. Send suggestions by noon on Monday, Oct. 17. Please include the person’s name, position and a few paragraphs explaining why he or she stands out.
Chem Technologies doubles size of its second plant in seven-stage project By CHRIS SWEENEY Rubber & Plastics News
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Chem Technologies Ltd. is doubling the size of its second plant in Middlefield with a 36,000-squarefoot addition and setting the foundation for future growth. The second phase of the firm’s seven-phase plan could house up to two more rubber mixing lines and will double the amount of floor space and dock capacity. Randy Vancura, Chem Tech president and chief operating officer, said the firm has tripled its headcount to 96 over the last five years, with the future lines projected to continue to add jobs. “There is no limitation here,” he said. “We’re private. We’ve got solid investors, and with solid growth, the world is our oyster, so to speak. It’s all about taking care of the customer at the end of the day — creating value and then getting those customers on and all of those customers we’ve maintained since the beginning.” The firm’s second plant is designed to be built in seven identical 36,000-square-foot phases. Chem Tech envisions a 277,000-square-foot facility, housed on a 589,000-squarefoot plot of land, to be built out as business dictates. Vancura said Chem Tech owns more land east of the addition to add a third complex if needed. All the excavation work has been completed on the land where the third phase eventually will be built. Vancura said construction on that phase of the building can begin as
“Because we’re private, we can develop things very quickly. We don’t have to go through a bunch of red tape. It’s just a matter of where’s the market, where’s the customer. We’re involved in all areas.” — Randy Vancura, Chem Tech president and chief operating officer
business dictates. “We engineered this down to the last molecule,” he said. “We always know that we’ll never ever say we’re done. As the business grows for our company, we’re committed to making that capital investment. That’s not an issue.” Phase two is being constructed, and Vancura said the work will be completed by year-end. Phase one was completed in the fall of 2015 and houses its eighth total and fourth mixing line. That line is now operational and, thanks to some additional enhancements, has the capacity for about 36 million pounds of rubber per year. The first phase also houses Chem Tech’s ninth total and fifth rubber mixing line, identical to the eighth. Vancura said it will come online as
soon as business dictates. “We can run the new lines very efficiently,” he said. “We get a lot of pounds out, and we’ve added new pelletizing capability and sizing of the pelletization. Because we’re private, we can develop things very quickly. We don’t have to go through a bunch of red tape. It’s just a matter of where’s the market, where’s the customer. We’re involved in all areas.” Chem Tech’s seven other lines are housed at the company’s 100,000-square-foot Middlefield headquarters across the street from the expanding second plant. Four of those lines focus on blends for chemical dispersions, and the other three are for rubber mixing. Since 2013, Chem Tech has been quite busy. It added a new addition to its headquarters in 2013 for research and development, along with a wing of executive offices. At the same time, it broke ground on the first phase of its new building. The firm serves a number of industries, focusing on high-value molded or extruded goods as well as medical, pharmaceutical and defense. The company mixes just about everything except silicone — ranging from all organics to both natural and synthetics. In addition to the expansion, Chem Tech has added a second laboratory mixer that has a greater capacity than the original. Chris Sweeney is a reporter at Rubber & Plastics News, a sister publication of Crain's Cleveland Business.
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Steel beams are raised for the addition to Chem Tech’s second facility. The project is expected to be completed by the end of the year and will be able to house up to two additional rubber mixing lines. (Chris Sweeney)
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Organic growth is giving Nordson spark By RACHEL ABBEY MCCAFFERTY rmccafferty@crain.com @ramccafferty
Westlake-based Nordson Corp. has put an increased focus on new product development in recent years, listening to what its customers need and trying to anticipate what they’ll want in the future. “So for us, looking at a lower growth environment, the focus has been around how do we create our own growth?” said Michael Hilton, president and CEO of the maker of precision dispensing equipment and systems. For Nordson, that has meant turning to the nVision product development process, which the company has been using for about three years. The nVision process is just part of the
company’s Nordson Business System, a set of best practices aimed at improving all aspects of the business. The process has led to more collaboration between the company’s various businesses, so people aren’t “reinventing the wheel” when creating new products, Hilton said. Nordson products are used in industries as varied as automotive, appliance, medical device and consumer packaged goods. Globally, it has about 6,100 employees. The company is well-known in the industrial world, Hilton said, but it operates a bit under the radar locally. People in the region may be more familiar with the philanthropic support of the Nord family and the company, but Nordson’s equipment helps create a variety of products people use every day.
“And there’s probably nothing that you’ve used or touched today that we haven’t had a hand in making,” Hilton said. “But people wouldn’t know that.” Jerry Milton, plant manager of Weekley’s Mailing Service Inc. in Berea, said the “reliability” of Nordson’s machines is what keeps him as a customer. And that’s important to the direct mail house, which needs reliable machines to serve its customers — if a project gets to Weekley’s late, the company still has to turn it around quickly to meet deadlines. Weekley’s currently has six Nordson units, and Milton said he’ll definitely go back to the company in the future. In total, Nordson has about 20 to 25 different product lines. The nVision process has let the company use its close relationships with customers to find ways to grow. It gives
Nordson a systemic way to include customer input, helped it prioritize those products with a chance of success and reshape its portfolio to put a stronger focus on new product development, Hilton said. It also has helped Nordson stay on top of its portfolio of products, assessing when products need to be phased out to make room for new items. “And in the end, what that has allowed us to do is really develop new products that our customers are looking for, to develop new applications that are important to them, to use the innovation — whether that’s a new product or a tiered product — to effectively create our own demand through participating (in) parts of the market that we wouldn’t otherwise participate,” Hilton said. “So, the fundamental piece was, let’s
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take advantage of what we’re good at, which is being very close to our customers, and then use that voice of customers to make sure we’re developing all the right things,” he said. For instance, a big area recently has been the idea of waterproofing cellphones, so Nordson has been involved in efforts around surface treatment or dispensing to help end customers meet that need, Hilton said. Another trend the company has been following is in the medical device business. There’s a move from stainless steel to plastics, which Hilton said Nordson was able to prepare for and create relevant products in after talking to customers. In addition to the nVision process of creating new products, the company has strived to find new applications for existing products and processes, said James R. Jaye, senior director of communications and investor relations. In an email, Jaye said an example would be using a modified version of the company’s adhesive dispensing equipment for assembling window frames to instead assemble solar panels. The company also has put a focus on “tiering” products, or making sure that different customer segments in an industry have access to different products that suit their needs, Hilton said. In the cellphone manufacturing space, for instance, the most advanced companies may use Nordson equipment to coat the screen or put the camera module together. But less-advanced manufacturers may just want to add a lower level of automation to their workflow. The tiered approach lets Nordson “capture those customers early on,” Hilton said. It’s that approach that allowed Nordson to gain more customers in the Chinese mobile phone market this year, Hilton said. To support that, Nordson built up more capabilities in this space in that region, which gave the company yet another way to get customer input and changing needs into the nVision process. Jaye said about 70% of the company’s revenues come from outside of the United States. The company is positioned to capture growth wherever it’s happening, though it’s also subject to softness in the market. In fiscal year 2015, the company noted in a news release that currency translations contributed to a decrease in sales of about 1%. But overall, Nordson’s efforts are paying off. Sales in the third quarter of the company’s fiscal year 2016 grew to $490 million, 6% higher than the like period of 2015. About 4% of that growth was organic, and about 2% was due to acquisitions, according to a news release. The nVision process helps the company decide if it should invest in developing a product or if it makes more sense to acquire, Hilton said. If the company meets its expected guidance, Hilton said organic growth would reach 5%, when most of its peers are struggling. And, if it meets its goals, Nordson could post $1.8 billion in revenue this year, Hilton said. He said he would like to see it reach more than $3 billion in revenue in the next five years, though that’s a stretch in this environment. In terms of growth, Hilton said Nordson has four main market segments it’s currently interested in: testing and inspecting electronics, room temperature dispensing, plastics processing for consumer packaging and, primarily, medical.
Crain’s 2016
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CFO of the Year
2007:
David K. Creamer, Kent State University; Glenn A. Eisenberg, The Timken Co.; Richard H. Fearon, Eaton Corp.; Richard L. Garcia, Wastequip Inc.; Craig Kaiser, YMCA of Greater Cleveland; J.T. Mullen, The Cleveland Foundation; Kevin V. Roberts, University Hospitals; Thomas G. Smith, Forest City Enterprises Inc.
2008: Bonnie Barrett, Cleveland Foundbank Inc.; Tim Browne, Wingspan Care Group; Jenniffer D. Deckard, Fairmount Minerals Ltd.; Mark O. Eisele, Applied Industrial Technologies; John Flanagan, Howley Bread Group Ltd.; Patricia Gaul, Playhouse Square; Ware H. Grove, CBIZ Inc.; Michael Headen, United Way of Greater Cleveland; Karen Melton, Kaufman Container Co.; Tim Pitsell, Parker Hannifin Corp.
2009: Rick Coan, Garick LLC; Robert C. Dills, American Red Cross of Cleveland; Richard C. Ebner, Liberty Bank N.A.; Steven C. Glass, Cleveland Clinic; John D. Grampa, Brush Engineered
Materials Inc.; Robert Gudbranson, Invacare Corp.; Michael E. Hicks, OMNOVA Solutions Inc.; Ann Holt-Wiolland, Centers for Families and Children; Yvette Ittu, Greater Cleveland Partnership; Fredric “Fritz” Kohmann, Shearer’s Foods Inc.; Julie McGraw, National Interstate Corp.; Frank Mercuri, Vocon; Patrick J. Powers, Donley’s Inc.; Joseph Rudolph, Darice Inc.; Gregory Rufus, TransDigm Group Inc; C. Michael Rutherford, Summa Health System; Gerhard Schmidt, Mobility Works; John Sesek, Positive Education Program; Stephen J. Smith, American Greetings Corp.; Ken Stefanov, Cleveland Indians
2010: James Abel, Lamson & Sessions Co.; Richard Boyson, Therapy Partners; Laurie Brlas, Cliffs Natural Resources; Mark Clark, FirstEnergy Corp.; Loree W. Connors, Vitamix Corp.;
Peter J. Crage, Cedar Fair Entertainment Co.; Craig Foltin, Cuyahoga Community College; Chris Hyland, Hyland Software; Brian S. Kenyon, Rock and Roll Hall of Fame and Museum; James Kerr, Jo-Ann Fabric and Craft Stores; Ronald R. Rozak, Fomo Products Inc.; Frank Mercuri, Vocon; Robert G. O’Brien, Forest City Enterprises Inc.; Mark J. Plush, Keithley Instruments Inc.; Vincent Petrella, Lincoln Electric Co.; Gregory Robinson, Safeguard Properties LLC.; Susan Suvak, Majestic Steel USA Inc.; Michael Szubski, University Hospitals; Andrew Tanner, The NRP Group; Pete Waters, Dealer Tire LLC; Mark R. Widmar, GrafTech International Ltd.
2011: Bill Chorba, NineSigma Inc.; Mark Clark, FirstEnergy Corp.; Kathleen Dillon, Ohio Technical College; Elizabeth Donaldson, De Nora Tech Inc.; Gale W. Fisk, Greater Cleveland Regional
Transit Authority; Mary Ann Freas, Southwest Community Health System; Betty Goodman, Vocational Guidance Services; Dave Hamrick, InfoCision Management Corp.; Dennis Jancsy, Medical Mutual of Ohio; Richard “Duke” Jankura, JumpStart Inc.; Elaine Kapusta, Dots LLC; Michael E. Mayher, Lakeland Community College; Scott A. Morgan, Cuyahoga County Public Library; Chris Pascarella, Enprotech Corp.; Vincent Petrella, Lincoln Electric Co.; Michael Pressnell, Clark-Reliance Corp.; Barry Reis, Jewish Federation of Cleveland; Cameron C. Rubino, OrthoHelix Surgical Designs Inc.; Susan Suvak, Majestic Steel USA Inc.; Robert Trabucco, Sterling Jewelers Inc.
2012:
David Adante, Davey Tree Expert Co.; Hilary F. Beatrez, The Cleveland Hearing and Speech Center; Michael F. Biehl, Chart Industries; Ann Conn, The A.M. McGregor Group; Harry B. Cool, Volunteers of America of Greater Ohio; Mario M. Danese, Visiting Nurse Association of Ohio; Elizabeth A. Donaldson, De Nora Tech Inc.; Donald J. Dragony, Alex N. Sill Co.; Joseph Dubois, Oswald Cos.; Richard H. Fearon, Eaton Corp.; Brian Gorris, Stripmatic Products Inc.; Dave Hamrick, InfoCision Management Corp.; John Harvan, Hospice of the Western Reserve; David Kuntz, Cleveland Metroparks; Scott Levin, GOJO Industries; Matt Lyon, Alliance Staffing Solutions; Thomas R. Paskert, Millwood Inc.; Joseph M. Randazzo, Austen BioInnovation Institute in Akron; Russell Schabel, The Philpott Rubber Co.; Darren R. Wells, The Goodyear Tire & Rubber Co.
2013: Charles Abraham, Hitchcock Fleming & Associates; Mark Belgya, The J.M. Smucker Co.; Terry Bichsel, First Merit Corp.; Dianne Brehm, United Way of Greater Lorain County; Frank
Cardinale, Benjamin Rose Institute on Aging; Susan Carlson, Advanced Management Services Group Inc.; Loree W. Connors, Vitamix Corp.; Sue Cyncynatus, Luterhan Metropolitan Ministry; Joseph Fornal, Ganley Auto Group; Denise Griggs, The Burton D. Morgan Foundation; Clark Lubaski, The Robbins Co.; Richard T. Marabito, Olympic Steel Inc.; Jane Marsh, Premier Bank & Trust; Julie McGraw, National Interstate Corp.; Cheryl McKenna, Community Foundation of Lorain County; Mary McMillan, Cleveland Zoological Society; Alan W. Siliko, KA Architecture; Michael Stanek, Hunt Imaging LLC; Wade Steen, Cuyahoga County Government; Sam Steinhouse, OneCommunity; Marlene Tehi, Evolution Capitals Partners LLC; Michael Tokich, Steris Corp.; Philip Weihe, BlueBridge Networks; Brian Witherow, Cedar Fair Entertainment Co.; Jim Wojtila, Mar-Bal Inc.
2014:
Jim Ansberry, Holden Arboretum; Mark Astorino, Chromaflo Technologies Corp.; James Carnovale, Judson Services Inc.; Ron Coill, OEConnection; Michael Dea, Equity Trust Co.; Brian Derrick, Summa Health System; Richard Fearon, Eaton Corp.; Scott Gainer, Cleveland Heights/University Heights City School District; Betty Goodman, Vocational Guidance Services; Kathy Heflin, The Albert M. Higley Co.; Sean Hennessy, The Sherwin Williams Co.; Jeffrey Hood, Alloy Engineering Co.; Sean Joyce, Stan Hywet Hall & Gardens; Carrie Krenicky, Cleveland Public Library; Brent Leslie, Port of Cleveland; Jon P. Marten, Parker Hannifin Corp.; Mary McDaniels-Thoburn, Western Reserve Historical Society; Timothy McNeill, Bettcher Industries Inc.; Raymond Mueller, Medical Mutual of Ohio; Bill Ruffing, Shaker Auto Lease Inc.; John Rusnaczyk, St. Vincent Charity Medical Center; Rick Smith, First Federal of Lakewood; Cyndi Sobe, AMRESCO, Todd Welki, Cleveland Museum of Natural History
2015:
Thomas P. Arnold, Western Reserve Academy; Steven J. Burger, Employers Health Co.; Marty Butler, ExactCare Pharmacy; Jennifer L. Demmerle, Northeast Ohio Regional Sewer District; Sharon Dumas, City of Cleveland; Philip Fracassa, The Timken Co.; William B. Furr, Key Community Bank; John Graves, Girl Scounts of North East Ohio; Robert Gudbrandson, Invacare Corp.; Beth Hall, Affinity Advisory Network; Dave Hegeman, Millcraft Paper Co.; Kevin Herendeen, Fathom; Christopher J. Holding, TimkenSteel Corp.; David Holvey, The Stein Companies; Kevin R. Krencisz, Cleveland Sight Center; Bill J. Mann, Joseph, Mann & Creed; Robert Matejka, RPM International Inc. (posthumously); Christopher L. Nagel, Fairmount Santrol; Robert G. O’Brien, Forest City Enterprises Inc.; William M. Reniff, Baldwin Wallace University; Craig Richmond, The MetroHealth System; Marc Rubenstein, The Free Medical Clinic of Greater Cleveland; Eric Rychel, Aleris; Robert Tonkinson, Mercy Health; Barbara Welker, LifeBanc; Brad Zucker, Ancora Advisors
10 years of honoring the best in finance
2016: Scott Bogard, CFO, vice president, Lumitex Inc.; Jim Brown, CFO, Dix & Eaton; Joel Domino, President
and CFO, Kent Displays Inc.; Mark Gamble, CFO, Ramco Specialties Inc.; Lisa Gribbell, CFO, vice president of finance, The PDI Group; Richard Klingshirn, vice president and CFO, Saint Ignatius High School; Eamon Larkin, CFO, Budget Dumpster; Julie McGraw, vice president, treasurer and CFO, National Interstate Corp.; Steven Raguz, CFO, Dealer Tire LLC; Bradley C. Richardson, executive vice president and chief financial officer, PolyOne Corp.; Greg Rufus, CFO, senior vice president, retired, TransDigm Group Inc.; Steven Schloenbach, vice president and CFO, Akron Community Foundation; Barbara Singhaus, CFO, COO, Planned Parenthood of Greater Ohio; George Strickler, executive vice president, CFO and treasurer, Stoneridge Inc.
For the last 10 years, Crain’s has honored Northeast Ohio’s top fiscal officers for outstanding financial leadership, asset management and strategic vision. These men and women are much more than number crunchers. They are strategic thinkers and trusted advisers. And while it’s often the top executives that get all the press, the CFOs are doing much of the work behind the scenes. This year’s CFO of the Year program, presented in partnership with KPMG, will honor a handful of these fine professionals as well as a decade’s worth of talented alumni.
Join Crain’s in celebrating the 2016 CFO Awards
The following individuals participated on this year’s judging panel: Brian Broadbent President and CEO, BVU: The Center for Nonprofit Excellence Jennifer L. Demmerle CFO, Northeast Ohio Regional Sewer District Betty Goodman CFO, Vocational Guidance Services Craig Richmond SVP and CFO, The MetroHealth System
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Crain’s 2016
CFO of the Year
GOLDEN LEDGER AWARD WINNER: Presented by KPMG
Greg Rufus, CFO, senior vice president, retired, TransDigm Group Inc. DOUGLAS J. GUTH
Greg Rufus spent the last 15 years helping boost significantly TransDigm Group Inc.’s revenue, leading to $3.2 billion in yearly sales as of this year. That said, acting as a key facet of that exponential rise may never have happened if Rufus hadn’t gotten a second interview with the Cleveland-based aircraft components manufacturer. Rufus, 60, who retired as TransDigm’s chief financial officer Oct. 1, remembers his first interview well, if not very fondly. It was his first job interview in 19 years, while the two company heads he talked with seemed as ill-prepared as he was. “I was getting asked two different questions at the same time, and I wasn’t sharp,” Rufus said. “It was like being on a first date. It was almost comical.” The Avon Lake resident asked for and received a second interview, which lasted 10 hours and included lunch, a golf outing, dinner and cocktails. He was offered a position as CFO and vice president of sales the next day. In the ensuing years, Rufus teamed with corporate leadership to kick up sales from $151 million to the multibillion-dollar enterprise TransDigm is today. His last four months, while busy, have not been quite as taxing, and included an overview of cybersecurity protocols and analysis of each of the company’s almost 60 acquisitions. In addition, Rufus shepherded the transition of his successor, Terrance Paradie, former executive vice president and CFO at Cleve-
land-based mining company Cliffs Natural Resources Inc. “Terry cracked the fraternity of this business group developed internally over the years,” Rufus said. “He took over the day-to-day when I started to wind down four or five months ago. Then it was just a matter of getting out of the
Celebrating achievement Congratulations to all the Crain’s CFO of the Year award winners and finalists, including our distinguished clients, on being nominated for this prestigious recognition. KeyBanc Capital Markets® applauds your accomplishments. Visit key.com/corporate
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way before Terry took over as CFO.” Sitting at three days before retirement when interviewed by Crain’s, Rufus said he’s emotionally prepared to leave the firm he had such an active hand in growing. “I always get asked about the parts of the job I’ll miss, like the friends I’ve developed and the fun I’ve had meeting with investors,” he said. “But I won’t miss the regulatory environment or the deadlines. Like everything else in life, it’s a tradeoff.” The retired executive attributes TransDigm’s multiyear upward trajectory to a decentralized business philosophy, an effort led by a small but savvy team. The company raised $16 billion in capital structure transactions during the last decade-and-a-half, while putting signatures on almost 50 business acquisitions during that timeframe. TransDigm sells ignition systems, specialized pumps and valves, electric generators, cockpit displays and other products to the military as well as regional and private jet companies. Owning design of niche engineered parts is lucrative when selling to an industry where passenger demand grows by 4% to 5% annually, Rufus said. “Everything that flies has one of our products in it,” he said. “Boeing may make the same model of plane for 30 years, so you have an annuity of 70 years selling them igniters. They’ll need to replace seat belts every few years, or faucets. There’s always going to be that after-market revenue stream.” His biggest challenge was keeping TransDigm’s finances under control during its rapid expansion. He points to operations accounting
skills honed at a previous position as divisional vice president at Emerson Electric. Keeping a tight knit management team in place had its own benefits as well. “You can choke a business to death by overstaffing it,” Rufus said. “For 15 years, I sat next to the company chairman, with the president on the other side of me. We addressed issues and opportunities that were there, and when we’d get stuck, we’d ask how to create shareholder value. It sounds simple, but it’s actually pretty tough.” A sharp operational focus led in part by Rufus has created a sophisticated financial organization staffed by highly competent people, said TransDigm chairman and CEO W. Nicholas Howley. “Our ongoing culture is a significant part of Greg’s legacy,” Howley said. “His ethics are outstanding and permeate the culture. I could not have asked for a better partner in this business.” Rufus expects his first official day of retirement to be one of comfort and satisfaction, particularly as he’ll have more time to spend with wife, Kathy, and an extended family that includes four sons and four grandsons, with a fifth on the way. What’s more, Rufus can say he helped build a billion-dollar company while hewing to a set of unique corporate values. “Twenty-five years from now, some employees may think back to 2000-2015 when there were those crazy management guys that created value 24/7 over that whole period,” Rufus said. “We grew a successful industrial company while keeping our values and having a lot of fun.”
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CFO of the Year
PUBLIC COMPANY CATEGORY FINALIST:
Bradley Richardson has “great and deep knowledge from an operational standpoint. We really look at the CFO as someone with operational expertise, and that’s what Brad brings.”
Bradley C. Richardson, executive vice president and chief financial officer, PolyOne Corp. Avon Lake-based PolyOne Corp. is a polymer materials maker with a global scope, so it made sense when it needed a new chief financial officer in 2013 that it looked for someone with significant international experience. The company got its man in Bradley C. Richardson, who previously held CFO roles at Diebold Inc. and Modine Manufacturing Co., and whose career included leadership assignments in Caracas, Venezuela, and London. Robert M. Patterson, chairman, president and CEO of PolyOne, said the international experience was only part of what has made Richardson a strong addition to the company’s management team. Patterson, who joined PolyOne in 2008 as CFO, said Richardson brings a wealth of knowledge in key functions including audit, tax and investor relations. Richardson also “conducts himself with the highest level of ethics and integrity and professionalism,” Patterson said. Even more importantly, Patterson said Richardson has “great and deep knowledge from an operational standpoint. We really look at the CFO as someone with operational expertise, and that’s what Brad brings.” According to his nomination, Richardson has “led by example, building strong working relationships with PolyOne’s five core businesses, using his past experience as a business general manager to help drive performance and strategy.” Richardson launched what the company calls the Platinum Medal initiative, in which teams or individuals within the finance and information technology departments “are recognized for their alignment with the business to impact topline growth, and it is generating positive initiatives and changes to enable future growth,” the nomination stated. Since early 2015, according to the nomination, Richardson played a key role in helping PolyOne buy back 7% of its stock outstanding; increase its dividend by 20%; fully fund its pension plan (it’s now more than 100% funded); acquire three businesses for a total purchase price of $180 million; and extending to 27 months the company’s streak of consecutive quarters of earnings per share growth. Richardson also has focused on making improvements in tax and audit functions. The nomination stated that PolyOne historically “had almost a 40% tax rate, and now it’s been reduced to approximately 32%, through more strategic planning and better understanding of tax laws.” Under Richardson’s leadership, the company also has launched a “guest auditor” program, which “gives non-finance employees experience to see different parts of the company, and provides fresh perspectives and feedback to ultimately
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improve the health and strength of the company.” Richardson and his wife, a high school librarian, live in Rocky River. He’s on the board of the Great Lakes Science Center, where, as you might expect, he’s a member of the Finance Committee. — Scott Suttell
— Robert M. Patterson, chairman, president and CEO of PolyOne
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Crain’s 2016 PUBLIC COMPANY CATEGORY FINALIST:
Julie McGraw, vice president, treasurer and CFO, National Interstate Corp.
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Members of the executive team at Richfield-based commercial truck insurer National Interstate Corp. are even busier than usual these days, since in addition to overseeing operations, they’re working to complete a deal with a Cincinnati company, American Financial Group Inc. National Interstate’s CEO, Anthony J. Mercurio, said he’s glad he has Julie McGraw on his team as chief financial officer to make that happen. “She’s someone with the highest integrity, work ethic and attention to detail,” Mercurio said. “It starts with Julie and cascades down her whole team.” McGraw, he said, is working closely with investment bankers to complete the deal with an American Financial subsidiary, Great American Insurance Co., in which Great American will acquire the 49% of National Interstate shares it does not already own. The $320 million deal is expected to close in the fourth quarter of 2016. Mercurio said McGraw played a key role in the economic modeling that helped structure the deal. He said she brought the same steady hand to that task that she brings to other key functions, such as budgeting and closing the company’s financial statements. “Julie holds herself to a standard of perfection, which is what you have to have in that role,” he said. McGraw is an experienced hand with acquisitions at National Interstate. In 2010, five years after becoming CFO, she helped close the successful purchase of Vanliner Insurance Co. of Missouri, a deal that
put National Interstate into the niche market of moving and storage transportation. She had to contend with “a lot of financial twists” in that acquisition, according to her nomination, due to a five-year balance sheet that was tied to it.
“The mechanics of that five-year balance sheet had to be written to guarantee that both parties agreed with them, since maintaining a positive partnership with Vanliner was a number one priority during the acquisition,” the nomination said. “The purchase has since proved to be ex-
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CFO of the Year PUBLIC COMPANY CATEGORY FINALIST:
George Strickler, executive vice president, CFO and treasurer, Stoneridge Inc. tremely successful for both parties involved.” Another highlight of McGraw’s tenure is helping to secure for National Interstate a spot for six straight years on Forbes magazine’s list of the 50 Most Trustworthy Financial Companies. “National Interstate has a structure of being transparent and has been recognized for doing so,” the nomination stated. In addition, since her arrival at National Interstate in 2005, McGraw has increased the company’s credit line from $5 million to $100 million, according to the nomination. McGraw last year worked with National Interstate’s human resources department to design what the company calls a “hierarchy of the finance department,” which highlights the skill levels needed for employees to advance to the next level. This allows employees “to see a path to promotion, with the goal of increasing promotions from within.” The nomination also described McGraw as “a leader in helping her team break out of that traditional finance role and put more weight in becoming more collaborative with the company’s business partners.” To do that, she helped launch training programs “centered around teaching critical thinking skills and adaptability so finance staff were ready for the shifting roles that were to be implemented to support the business and its growth,” the nomination stated. “It’s Julie’s mission that no one gets ‘left behind’ during these changes.” — Scott Suttell
When George Strickler was named executive vice president and chief financial officer of Stoneridge Inc., the global designer and manufacturer had a balance sheet that showed costs had increased 28%. The Warren company closed four of its plants, which resulted in a $50 million reduction in overhead costs. That number proved especially valuable during the financial downturn, when Stoneridge’s sales dropped by about 40% in a two-year span. Now, in Strickler’s 11th year with the company, Stoneridge is having a record year, with sales increasing by almost $100 million — 13%. “George’s impact on the organization is a lot broader than what people would necessarily expect from a CFO,” Stoneridge CEO Jonathan DeGaynor said. When Stoneridge was sold in 2014, Strickler and his finance team “did a recap of the company” that, according to the nomination, paid off $175 million in long-term debt and refinanced at a much lower interest rate, “immediately saving $10.5 million a year.” The company is currently looking at a compound growth rate of 6.3%, and “profitability is increasing just as rapidly,” the nomination said. DeGaynor, who was appointed to his position in March 2015, said that as a new CEO, Strickler’s “value has been far greater than his internal tactical and strategic activities.” He said Strickler is “extremely capable” in both external (such activities as investor meetings and quarterly calls) and internal settings. “His depth of experience and his
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consistent results make him a steady voice in even the most difficult of discussions,” DeGaynor said. And while a CFO and numbers obviously go hand-in-hand, the Stoner-
idge CEO said Strickler’s way with stats is on a different level. “His ability to manage the numbers he keeps in his head and manage those constituencies, whether it
be banks or investors, is as good as I’ve ever seen,” DeGaynor said. “As a CEO coming into an organization, not having all the history, the fact that I have a guy sitting next to me not having to find the stuff makes my job easier.” Prior to joining Stoneridge, Strickler was executive vice president and CFO of Republic Steel. He also was the CFO for BorgWarner Inc., and he had a 30-year tenure at Goodyear, culminating in serving as vice president of finance. Strickler serves on the board of directors of Technical Consumer Products and Crown Holdings. He’s also a board member for a pair of nonprofits — Summa and the Smeal College of Business at Penn State University. He’s currently working with Penn State to reduce the amount of debt that students face after graduation. Strickler also served for seven years on the board of Revere High School, where his kids went to school. “He’s tireless,” DeGaynor said. “I wish I had his energy.” — Kevin Kleps
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PRIVATE/MEDIUM COMPANY CATEGORY FINALIST:
Scott Bogard, CFO, vice president, Lumitex Inc.
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Scott Bogard was a non-traditional choice for chief financial officer of a technology manufacturing company, according to CEO Peter Broer. Bogard comes from the private equity world rather than traditional accounting. In his endorsement letter, Broer said Bogard was instrumental in elevating Lumitex — a Strongsville-based lighting technology company with 200 employees — to a higher level of systems, process controls and organization, “building the bridge across the ‘Valley of Death’ that bedevils growth companies as they expand beyond a single leader’s reach.” In his two years with the company, Bogard is credited with making both a financial and cultural impact on Lumitex by strengthening both the external reporting systems and internal control systems. He helped reduce senior debt by more than $4 million, improved margins through price increases and reduced overall inventory levels by 30%. He also led a $2 million sale of a non-core product line, increased contribution margins by 4%, and grew earnings before interest, taxes, depreciation and amortization to 10%. According to the nomination, his achievements in improving transparency and fostering open communication positioned Lumitex to successfully complete a recapitalization of the company in 2015. Bogard implemented a new enterprise resource planning (ERP) labor reporting module, business intelligence package and more robust backups, while assuring rigor in following ERP guidelines, according to the nomination. “Scott is a key member to the company’s success and rebirth,” Broer said in the nomination. “His compa-
nywide cultural transformation empowers junior and mid-level employees, provides operational discipline and increased usage of information systems for improved decision making.” Katie Spiegler, senior manager at BDO, Lumitex’s external auditor, calls Bogard a strategic visionary leader. “He took a company that had policies and procedures, and implemented them with controls in place to better assess the financial status of the company,” she said. “We’re watching him take the company to the next level. He’s looking beyond the numbers and using the numbers to springboard the company.” In addition to his financial contributions to the company, Bogard coled the process to adopt a new corporate mission and vision statement. In his nomination, he is described as a world-class leader who continues to push the company to new heights by fostering a culture of success. Spiegler said Bogard is collaborative and made transparency of the management team a priority. In his endorsement letter, Broer credits Bogard with pushing him to expand the scope of the company and said that Bogard has a “tough, thorough and logical mind to make this a better business.” Bogard is on the board of the Cleveland Museum of Contemporary Art and previously served on the board of Wire-Net, a nonprofit economic development organizing serving manufacturing businesses on Cleveland’s West Side. In his spare time, he is a semi-competitive runner who is also interested in skiing and cycling. — Kimberly Bonvissuto
CRAIN’S CLEVELAND BUSINESS
Crain’s 2016
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CFO of the Year
PRIVATE/MEDIUM COMPANY CATEGORY FINALIST:
Jim Brown, CFO, Dix & Eaton Sometimes one person can make all the difference, according to Dix & Eaton Inc. CEO Chas Withers. At Dix & Eaton, that person is Jim Brown, who is involved in every strategic decision in the firm. In addition to his role as chief financial officer, he serves on the firm’s leadership committee and as corporate secretary and treasurer. “I’ve interacted with dozens of CFOs over the years, but have rarely, if ever, seen one who combines financial acumen, sharp attention to detail, keen strategic thinking and a partnering demeanor like Jim Brown,” Withers said. “He is able to quickly distill and synthesize information and is invaluable in helping our firm make smart decisions in an expeditious but thoughtful fashion.” At the firm, Brown’s most impactful initiatives center on the Employee Stock Ownership Program (ESOP), facilities management, financial and strategic guidance during the economic downturn and the finance team. Brown led a nearly two-year process of creating a deal structure, financial planning and projections, and securing bank financing for the ESOP. The successful buyout of existing shareholders and a new ownership structure allowed the firm to remain independent and provide a benefit to employees. He also led the team in the space selection process and 2014 build-out of the firm’s new space downtown. The deal is expected to save the firm more than $2 million in facilities costs over a decade. “During his tenure, he’s maintained a consistent focus on process improvement, which has had a demonstrable impact on our profitability and our efficiency; and he brings a degree of proactivity and anticipation that is simply invaluable,” Withers wrote in the nomination. With the economic downturn hitting the industry in 2008 and 2009, Brown was instrumental in reviewing expenses, revenue drivers and capacity to create a more efficient model, according to his nomination. The firm maintained a break-even status until the industry recovered in 2010 and margins returned to double-digit levels. “He projects a maturity and sophistication on financial management far beyond his years,” Withers said. “His level of productivity and efficiency is off the charts.” His leadership includes heading a three-member finance team that continually works to improve processes in all financial areas, including streamlining billing processes and improved reporting. “He has a tremendous real-time feel for the performance of our organization,” Withers said. “He’s able to do that in a unique way while also looking around the next corner. That ability to have a consistent pulse on the enterprise while also being anticipatory is incredibly valuable.” Brown is a member of the CFO forum of Worldcom, an industry collaborative, and participates in the Greater Cleveland Partnership’s Tax Reform Focus Group. He is a member of National Center for Employee Ownership and is a volunteer recreational baseball coach at Kenston Local Schools. — Kimberly Bonvissuto
“During his tenure, he’s maintained a consistent focus on process improvement, which has had a demonstrable impact on our profitability and our efficiency; and he brings a degree of proactivity and anticipation that is simply invaluable.” — Chas Withers, Dix & Eaton Inc. CEO
THANKS, STEVE, FOR BEING A LEADER WE CAN COUNT ON. We’re proud to congratulate Steve Raguz as a finalist for Crain’s 2016 CFO of the Year Award. As CFO, Steve has been instrumental in Dealer Tire, LLC’s continued success. His extensive knowledge of the business, from both a financial and operational perspective, has helped our organization rapidly grow and thrive in the North American market. Steve’s exemplary conduct and commitment to excellence inspire leadership at every level throughout the company.
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Financial Executives International Northeast Ohio Chapter
PRIVATE/MEDIUM COMPANY CATEGORY FINALIST:
Lisa Gribbell, CFO, vice president Leadership • Vision • Management of finance, The PDI Group FEI serves as the resource for today’s CFOs and their finance teams.
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In her nomination form, Lisa Gribbell is described as a thought leader who can articulate the information behind the numbers and as a person of high integrity when it comes to financial reporting. PDI is a Solon-based manufacturing company that provides weapons support products and handling systems used primarily by the U.S. Air Force, U.S. Navy and more than 40 allied air forces worldwide. As a result of changes Gribbell implemented, the company more than doubled its net income and increased profit margins by 60%. She also identified strategic product lines to invest in while disposing of others. She also developed reporting and measurement systems that deliver quick results and provide operational information for labor efficiencies, inventory by product line and on-time performance. Gribbell helped on the cost-saving front by reducing annual financing costs by 60% and the annual tax burden by 20% through the establishment of an interest-charge domestic international sales corporation. “She is a solid, strategic thinker whose advice has proven to be invaluable to me and my entire leadership team,” Irwin G. Haber, chairman and CEO, wrote in the nomination. “She exhibits a methodical and disciplined approach in discharging her responsibilities that is contagious to all other employees at the company.” Gribbell oversaw negotiations of a divisional divestment and is actively involved with the acquisition team
interest rates and led an aggressive debt repayment effort that helped the company retire $3.8 million of
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CFO of the Year
PRIVATE/LARGE COMPANY CATEGORY FINALIST:
Joel Domino, president and CFO, Kent Displays Inc. “She is a solid, strategic thinker whose advice has proven to be invaluable to me and my entire leadership team.” — Irwin G. Haber, chairman and CEO
debt in four years. Due to reporting systems she implemented, the company’s on-time performance jumped from 70% in 2012 to more than 90% today. Gribbell manages collection risk by working with customers in establishing letters of credit and working closely with the sales department on contracts, the nomination said. She also was intimately involved in the development of a five-year strategic plan implemented in 2014. “What she’s brought to this company is instrumental with systems and process; and she brought a discipline to the organization that has definitely elevated us,” said Nathan Haber, the company’s vice president of sales and business development. Outside of the financial world, Gribbell sits on the board of Olmsted Performing Arts, where she serves as front of the house manager, web developer, creative adviser and fundraiser. — Kimberly Bonvissuto
Kent Displays CEO Al Green describes Joel Domino as a man with many skills, but since this is the CFO of the Year section, we’ll start with this one: Domino is a “numbers wizard,” according to Green. He has an incredible ability to do calculations in his head and a firm grasp on how changes in the business will impact its finances. Those skills come in handy when the company — which makes “Boogie Board” electronic writing tablets for the consumer market — needs to negotiate a deal with a supplier or a business partner. “It’s always great having him on your side of the table,” Green said. “Because when you’re talking about the details of a deal, he’s already crunched the numbers in his head. ... We just all look at Joel and say, ‘So, at the end of the day, what does that mean?’ And he’s just got the answer. He did it in his head literally in 15 seconds.” But when asked to name Domino’s greatest strength, Green cited his broad range of skills. In his nomination letter, Green noted that Domino has “significant capabilities in sales, marketing, operations, human resources (and) facilities management.” Domino, who also serves as president of the company, regularly travels to help close deals with major customers and shake hands with potential business partners at trade shows. He also has helped manage the company’s intellectual property since the 1990s, long before Kent Displays became a consumer products company. And it was not an easy job: During the company’s early years, it faced what the nomination described as a
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“costly lawsuit” regarding its technology. Domino was tasked with managing not only the day-to-day operation
of the company, but he also “had to finance the legal efforts, identify attorneys, manage the process and see it
through the six year struggle until the court settled completely in KDI’s favor,” the nomination said. Domino hired Green in 2007, just as the liquid crystal research and development company was becoming a consumer products business. To make that shift, Domino secured state financing and loans that helped the company install roll-to-roll manufacturing lines. Since then, Kent Displays has produced more than six million liquid crystal displays. In 2015, it generated $32 million in revenue. The company has roughly 90 employees, and many of them turn to Domino for guidance, Green noted in his nomination letter. Domino works with “C-level executives and factory floor workers, advanced research scientists and student interns,” Green wrote. The nomination noted that Domino is “friendly and approachable, often chatting with employees about all our sports teams ... His staff knows he will personally contact customers to resolve delinquent payments if necessary and use his charm to collect overdue invoices. He has an underlying determination to excel.” — Chuck Soder
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Crain’s 2016
CFO of the Year
PRIVATE/LARGE COMPANY CATEGORY FINALIST:
Steven Raguz, CFO, Dealer Tire LLC “Steve’s hard work, intelligence, fairness, and keen negotiating skills were critical to the final outcome. Because of his professionalism, hard work, great insight, and good humor, Steve has become a highly respected member of Dealer Tire’s team” — Scott Mueller, CEO
Raguz learned all he could from the rest of the team, including Waters, who has since retired. The work paid off: At the end of 2014, private equity firm Lindsay Goldberg bought 60% of the company in a deal that valued Dealer Tire at $1.4 billion, Mueller noted in the letter. Raguz worked to maximize the sale price while also taking into account the diverse interests of the buyer, the Mueller family, the private equity firm that had owned a minority stake in the business and the company’s employees, Mueller said. The company employed roughly 1,100 people as of July, including 450 in Northeast Ohio. “Steve’s hard work, intelligence, fairness, and keen negotiating skills were critical to the final outcome,” Mueller wrote in his letter. Since joining Dealer Tire, Raguz has taken on several other major tasks as well. He’s leading the effort to move the company from its current headquarters on Chester Avenue to the Victory Center building on Euclid Avenue. Raguz also leads the company’s strategic planning process, and Mueller noted that he chose Raguz to head up an effort designed to determine how Dealer Tire might go about entering the Chinese market. “Because of his professionalism, hard work, great insight, and good humor, Steve has become a highly respected member of Dealer Tire’s team,” Mueller noted in the letter. — Chuck Soder
It didn’t take Scott Mueller long to figure out that Steven Raguz would fit right in at Dealer Tire. The company, which distributes tires and other light vehicle maintenance products, was looking for a chief financial officer who could replace Pete Waters, whom Mueller described as a highly respected executive who’d been with Dealer Tire since it was founded. During that search, Mueller met Raguz for breakfast at Yours Truly in Chagrin Falls. They hit it off. “I could just tell after about 20 minutes of spending time with him that he and I would be friends,” said Mueller, the CEO. Not only did he have the skills to do the job, he also had the personality, according to Mueller, who noted that Raguz has the ability to marshall a team, work across departments and make a joke at his own expense. Dealer Tire hired Raguz in May 2013 and immediately put his skills to the test. The company was already preparing for what Mueller described as an “incredibly complex” financial transaction: Dealer Tire had decided to sell a majority stake in the company, either to a private equity firm or to investors on the stock market. So Raguz and his team took on the “daunting task” of preparing for an initial public offering while also marketing the company to private equity firms, Mueller noted in the nomination letter. All the while,
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CRAIN’S CLEVELAND BUSINESS
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CFO of the Year
PRIVATE/LARGE COMPANY CATEGORY FINALIST:
Mark Gamble, CFO, Ramco Specialties Inc. adviser,” Malson said. Malson said Gamble’s ability to accurately streamline Ramco’s processes, procedures and product pricing helped guide the decision to exit certain product lines and markets, while creating a more focused direction. Another major area Gamble contributed to was the development of Ramco’s strategic management team. He also facilitated the development of a corporate acquisition strategy to help identify and investigate potential acquisition opportunities. “(The strategic management team) is a team with tremendous strengths and abilities without the egos; a team with identified and unified goals and a winning culture,” Malson said. “Mark is a proven leader within this team.” In 2016, Gamble led the successful financing and transition of the company to a new, state-of-the art, 175,000-square-foot facility that provides improved efficiency, image and culture, according to the nomination. The move consolidated operations from four locations into one. Gamble’s negotiations on land acquisition, a tax incentive package and a financing structure allowed Ramco to remain in Hudson. Outside of his professional commitments, Gamble is finance committee chair for Hudson United Methodist Church; treasurer for Santa PICsU, a charitable organization supporting the children and staff of Akron Children’s Hospital; and former treasurer of the Hudson Athletic Boosters Club. —Kimberly Bonvissuto
Mark Gamble was a driving force in the transformation of Hudson-based Ramco Specialties Inc., according to CEO Richard A. Malson II. “Ramco was a traditional, small family business successful through a few initial strategies, hard work and luck,” said Malson, adding that the company was looking for long-term sustainability and needed a change of strategy. “Before Mark, Ramco simply did not have the tools necessary to analyze, prioritize and execute effectively and efficiently multiple strategic initiatives. In just a few years, Mark has improved all of Ramco’s financial reporting, financial/ capital management, risk management and IT systems.” Gamble helped transform Ramco from a commodity-oriented distributor to a larger, growth-oriented manufacturer/value-added distributor and manufacturer. He has 24 years of experience as a chief financial officer in a variety of industries, including startup, growth-oriented and turnaround companies. At Ramco, Gamble streamlined and improved financial reporting/ control, identified cost/profit improvement areas and brought a focus to strategic planning, according to the nomination. He brought the same methodologies to Ramco’s affiliate company in Italy, Ramco Europe, to provide consistency in reporting. “Mark has brought a level of professionalism, sophistication and discipline to Ramco that did not previously exist, and he has become my and the board’s and the owners’ key
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CRAIN’S CLEVELAND BUSINESS
Crain’s 2016
Complimentary In-flight WiFi NONPROFIT CATEGORY:
Richard Klingshirn, vice president and CFO, Saint Ignatius High School
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In a sense, Richard Klingshirn came home. In April 2013, he brought 30 years of executive experience to the leadership team at Saint Ignatius High School, his high school alma mater. It wasn’t so much a career decision but rather a “response to a vocation,” said Rev. Raymond Guiao, the school’s president. “Richard is a known and valued entity here, and is highly respected,” Guiao said. “I’ve heard it said by a number of those who report to him that he’s the best boss they’ve ever had.” Sure, much can be said about Klingshirn’s financial acumen. After all, he cut his teeth at Intellinex LLC (a subsidiary of Xerox) and Ernst & Young LLP before arriving at the West Side private high school. At Saint Ignatius, he implemented a zero-based annual budgeting process and longterm financial modeling. These and other improvements orchestrated by Klingshirn have resulted in breakeven operating results in each of the last three years. More importantly, those improvements have resulted in significant reinvestment in the school, especially in need-based financial aid with a more than $1 million investment over three years. The school also launched more than $1 million of capital improvements over three years. Perhaps the most noteworthy part of his job involves Klingshirn working with parents and students who encounter difficulties paying tuition. The nomination noted that his “com-
mitment to his Catholic faith and the Jesuit mission has allowed him to embrace each encounter with a parent or student ... with empathy and compassion.” Guiao described him as a “man with a real heart for people and their circumstance.” “Richard views each of these en-
counters as an opportunity to understand and find a solution that is achievable for the family and most importantly, does not result in any interruption in the students’ education,” the nomination said. “Richard views this as his most important responsibility. These situations can lead to devastating results if the
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CFO of the Year NONPROFIT CATEGORY FINALIST:
Steven Schloenbach, vice president and CFO, Akron Community Foundation school were simply to ‘demand’ tuition obligations be met.” Beyond his financial duties, Klingshirn also is in charge of operations. His responsibilities include facilities, transportation, security, campus dining, retail operations, human resources and the school’s performing arts center — all of which have been seen improvements since he joined the school. Of note, improved quality and expanded hours for campus dining resulted in a sales boost of more than 20%. “Richard’s communication skills, ability to articulate complex issues and proposed solutions is truly appreciated and consistently noted by our board,” Guiao said in the nomination. “Richard has demonstrated an unwavering commitment to listen to every member of our faculty and staff and work with them to solve issues and move the school forward. In doing so, he has earned the highest level of respect and gratitude for so many of our people.” — Timothy Magaw
Arriving in June 1996, Steve Schloenbach was only the third employee at the Akron Community Foundation, which at the time had a little more than 125 individual fund relationships and assets totaling slightly more than $40 million. Today, it boasts assets of more than $182 million. It’s been a dramatic transformation of which Schloenbach has been a key part. In particular, by 2008 when a planned transition in key management occurred, the foundation’s board and staff embarked on a multiyear donor engagement plan in 2009 that challenged almost all aspects of the foundation’s critical thinking, the nomination said. And during that time — a period of great economic uncertainty and market volatility — Schloenbach championed many of the new strategies involving local professional advisers, banking representatives and the foundation’s ability to accept unique and non-liquid assets. Over the last five years under
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Schloenbach’s leadership in the finance area, the foundation has been transformed into a more “donor-centric organization.” Specifically, it has added more than 200 new funds and $62 million in new contribution revenue since 2011. Moreover, new records in annual grants and charitable distributions have been set and bro-
ken in three of the last four fiscal years, topping $9.6 million this past year, according to the nomination. “Here’s a guy who simply and honestly makes us better,” said John T. Petures Jr., the foundation’s president and CEO. Under Schloenbach’s leadership, Petures said the foundation has embraced outside investment managers, expanded language in its standard fund agreements to permit multi-generational advisement on grantmaking and rewritten its investment policy statement, incorporating best practices of community foundations and other institutional investors from across the country. Before joining the foundation, Schloenbach was the supervising senior audit officer at FirstMerit and before that was a trust risk manager and compliance officer at the First National Bank of Ohio. He earned his bachelor’s in business administration and finance from the University of Akron in 1990 and completed a
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CFO OF THE YEAR 10TH ANNIVERSARY PRESENTED BY
OCTOBER 19, 2015 OCTOBER 19, 2015
CFO OF THE YEAR
CFO OF THE YEAR OCTOBER 19, 2015
PRESENTED BY
CLASS OF 2015
GOVERNMENT CATEGORY
SHARON DUMAS
SHARON DUMAS
City of Cleveland
City of Cleveland Cleveland, like nearly all major cities, has had its financial challenges over the last decade. But when news reports focus on the most challenged cities, Cleveland isn’t mentioned and Sharon Dumas, finance director since Frank Jackson became mayor in 2006, is part of the reason. Though she is always quick to credit the mayor, the city has, under Dumas’ financial leadership, restructured its debt to take advantage of lower interest rates and has maintained a balanced budget without significantly cutting city jobs or services. Her nomination credits her ability to forecast financial impacts and control costs with positioning the city to have the resources available to fund the capital, infrastructure and safety projects needed to prepare for the coming Republican presidential convention in July. One key to the city’s ability to avoid turbulent financial waters has been the introduction under Dumas and Jackson of five-year budget plans, which have included becoming self-insured, increasing employee contributions to health care premiums, ongoing budgetary reviews
PRESENTED BY
CLASS OF 2015
GOVERNMENT CATEGORY
CFO OF THE YEAR and end-of-year balance discussions with department heads. The nomination credits that long-range planning with helping to avoid financial crises for the last five years. As if managing a $1.1 billion annual budget wasn’t enough, Jackson temporarily added to Dumas’ portfolio. For seven months, beginning in October 2014, Dumas took on the job as interim director of the city’s public utilities — Cleveland Public Power and the water department. At the time, Dan Williams, the mayor’s spokesman, told The Plain Dealer, “You know what they say: If you want something done, find a busy person to do it. (Dumas) is an incredible multitasker. She’s tremendously talented and able to keep all the balls in the air without dropping any.” Incidentally, the city’s 2014 budget was recognized by the Government Finance Officers Association with its “Distinguished Budget Presentation Award.” Before coming to Cleveland City Hall, Dumas served as finance director for the City of East Cleveland and district credit manager for LTV Steel Co. Dumas began her career with the city in
March, 1999 as assistant director in the community development department. Soon she was commissioner of neighborhood development before taking over operation of the struggling $200 million Empowerment Zone neighborhood revitalization program before moving over to the number two finance department job. Her job wrangling the $1.1 billion city budget has won her accolades. When the city of Detroit fell into bankruptcy in 2013, Kevin O’Brien, now a retired Cleveland State University researcher who followed city finances for decades, told Crain’s that Dumas ranked with George Voinovich’s first finance director, William Reidy, who dug the city out of default in 1980. “I look at the finances of the city historically since Bill Reidy, and we’ve had great finance directors with the exception of one or two,” O’Brien said. Dumas, he went on, “has done a great job, better than anyone since Reidy.” — Jay Miller
Reprinted with permission from Crain’s Cleveland Business. ©2015 Crain Communications Inc. All Rights reserved. Further duplication without permission is prohibited. Visit www.crainscleveland.com.
PRESENTED BY
CLASS OF 2015 PUBLIC COMPANY CATEGORY
PHIL FRACASSA The Timken Company In the separation of the Timken Co. and its steel business, which became a new public company called TimkenSteel Corp., Phil Fracassa stayed and helped guide it through the split, becoming its chief financial officer after nine years with the $3.1 billion global maker of bearings, transmissions, gearboxes and related products based in Canton. Fracassa had been senior vice president of planning and development since 2012, after joining the Canton company in 2005 as vice president-tax. Along the way, he held a series of senior financial positions including senior vice president of tax and treasury and senior vice president and group controller of the bearings and power transmission business, the businesses that remained with Timken after the spinoff of the steel business. The spinoff of a major line of business like Timken’s steel operation is fraught with financial implications and Fracassa played a key role in that transaction.
“Phil has been a key contributor to the success of The Timken Co. since joining us in 2005, and in late 2013, prior to being named CFO, led the team that tackled one of the most challenging and complex initiatives in the company’s history — the separation and spinoff of our steel business,” wrote Timken president and CEO Richard Kyle in an email. “Phil was been instrumental in re-positioning Timken and improving investors’ overall perceptions of the company.” According to his nomination, Fracassa has overseen numerous acquisitions and in his tenure as CFO has cut costs and steered the company through a number of risk-management decisions. Fracassa began his career with what has become PricewaterhouseCoopers in Detroit. Before joining Timken, Fracassa was director of taxes for Visteon Corp., an automotive electronics supplier. He also served as a tax attorney with General Motors. A native of Warren, Mich. And a certified
public accountant, Fracassa holds a bachelor’s degree in accounting from the University of Detroit and a law degree from the University of Detroit’s Mercy School of Law. In 2011, he completed the Advanced Management Program at INSEAD in Fontainebleau, France. Outside the office, Fracassa is a member of Financial Executives International, the Manufacturers Alliance for Productivity and Innovation, or MAPI, and the Association for Corporate Growth. He was included in Treasury & Risk magazine’s lists of 40 distinguished finance executives under the age of 40, according to his official biography. He also is on the board of the Canton Regional Chamber of Commerce, where he is immediate past chairman, and the Cleveland advisory board of the FM Global, a commercial property insurance company. — Jay Miller
three-year certification program at the University of Notre Dame. Schloenbach, who has three daughters, also is deeply involved with the Boy Scouts of America. The former Eagle Scout is involved with the Great Trail Council of the Boy Scouts of America. In 2011, he received the Silver Beaver Award — the highest honor bestowed on a volunteer by the national Boy Scouts organization. In fact, Petures said Schloenbach’s commitment to doing what’s right — something instilled in him by the scouts — translates well to his work at the foundation, particularly his commitment to transparency. “For all nonprofits, we have to be accountable to the public,” Petures said. “They expect and can demand that there are standards in place, safeguards in place for the money they entrust to us as an organization. You’re nothing without that credibility and reputation that lets donors know we’re paying attention.” — Timothy Magaw
Cleveland, like nearly all major cities, has had its financial challenges over the last decade. But when news reports focus on the most challenged cities, Cleveland isn’t mentioned and Sharon Dumas, finance director since Frank Jackson became mayor in 2006, is part of the reason. Though she is always quick to credit the mayor, the city has, under Dumas’ financial leadership, restructured its debt to take advantage of lower interest rates and has maintained a balanced budget without significantly cutting city jobs or services. Her nomination credits her ability to forecast financial impacts and control costs with positioning the city to have the resources available to fund the capital, infrastructure and safety projects needed to prepare for the coming Republican presidential convention in July. One key to the city’s ability to avoid turbulent financial waters has been the introduction under Dumas and Jackson of five-year budget plans, which have included becoming self-insured, increasing employee contributions to health care premiums, ongoing budgetary reviews
and end-of-year balance discussions with department heads. The nomination credits that long-range planning with helping to avoid financial crises for the last five years. As if managing a $1.1 billion annual budget wasn’t enough, Jackson temporarily added to Dumas’ portfolio. For seven months, beginning in October 2014, Dumas took on the job as interim director of the city’s public utilities — Cleveland Public Power and the water department. At the time, Dan Williams, the mayor’s spokesman, told The Plain Dealer, “You know what they say: If you want something done, find a busy person to do it. (Dumas) is an incredible multitasker. She’s tremendously talented and able to keep all the balls in the air without dropping any.” Incidentally, the city’s 2014 budget was recognized by the Government Finance Officers Association with its “Distinguished Budget Presentation Award.” Before coming to Cleveland City Hall, Dumas served as finance director for the City of East Cleveland and district credit manager for LTV Steel Co. Dumas began her career with the city in
March, 1999 as assistant director in the community development department. Soon she was commissioner of neighborhood development before taking over operation of the struggling $200 million Empowerment Zone neighborhood revitalization program before moving over to the number two finance department job. Her job wrangling the $1.1 billion city budget has won her accolades. When the city of Detroit fell into bankruptcy in 2013, Kevin O’Brien, now a retired Cleveland State University researcher who followed city finances for decades, told Crain’s that Dumas ranked with George Voinovich’s first finance director, William Reidy, who dug the city out of default in 1980. “I look at the finances of the city historically since Bill Reidy, and we’ve had great finance directors with the exception of one or two,” O’Brien said. Dumas, he went on, “has done a great job, better than anyone since Reidy.” — Jay Miller
Reprinted with permission from Crain’s Cleveland Business. ©2015 Crain Communications Inc. All Rights reserved. Further duplication without permission is prohibited. Visit www.crainscleveland.com.
Reprinted with permission from Crain’s Cleveland Business. ©2015 Crain Communications Inc. All Rights reserved. Further duplication without permission is prohibited. Visit www.crainscleveland.com.
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Crain’s 2016 NONPROFIT CATEGORY FINALIST:
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Barbara Singhaus, CFO, COO, Planned Parenthood of Greater Ohio Barbara Singhaus’ fingerprints are all over Planned Parent of Greater Ohio — and for good reason. She began her journey with the organization more than 30 years ago as a board member. She has served on Planned Parenthood boards at the local and national level. In May 2006, she was elected chair of the Planned Parenthood of Stark County’s board and served on the team that met over 18 months to consider and facilitate the merger of five Northeast Ohio Planned Parenthood affiliates into a cohesive organization that covered Northeast Ohio. In 2012, she used that experience to facilitate a merger to create a statewide Planned Parenthood organization. And within a year or so of that merger, Planned Parenthood leadership felt it needed a strong chief financial officer. Singhaus raised her hand — despite being in semi-retirement — and said she would step up to the plate, according to Iris Harvey, Planned Parenthood of Greater Ohio’s president and CEO. “She’s had leadership positions in many elements of the organization,” Harvey said. “She’s just all around a great cheerleader for the organiza-
tion and the people we serve.” In her current role, she’s steered the organization through successful implementations of new electronic medical record, electronic practice management and accounting systems, according to the nomination. And despite the uncertainty facing the health care industry as a whole, the local Planned Parenthood affiliate has seen growth in the patient populations it serves, while others have seen a decline. Moreover, the organization’s revenue had an almost 10% increase for the 2014-2015 fiscal year, and another 5% increase for 2015-2016. All this work has been ongoing during what has been a particularly challenging time for the health care industry in the wake of the Affordable Care Act. “If you had asked what is the characteristic most important to me in Barbara, it would be that she is truly trustworthy,” Harvey said. “I can trust her work with patients, staff, our board and with me.” In addition to her CFO work, Singhaus also oversees medical operations of 21 health centers across Ohio and a staff of more than 160 health
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CFO of the Year
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service and medical professionals. According to the nomination, she’s been instrumental in “getting the right systems and processes implemented throughout the affiliate to position (Planned Parenthood of
Greater Ohio) as an important part of the health care safety net in Ohio.” “She’s quietly influential,” Harvey added. “She’s quietly successful in her leadership style. I think the world of her.” — Timothy Magaw
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Crain’s 2016
CFO of the Year
RISING STAR AWARD WINNER:
Eamon Larkin, CFO, Budget Dumpster In 2013, Eamon Larkin left the world of corporate finance to join childhood friends John Fenn and Mark Campbell to take over all financial operations at the pair’s growing startup, Budget Dumpster. The Westlake company has no dumpsters of its own. In fact, it contracts with haulers all over the county to take the hassle out of dumpster renting. And like with any digital startup, Budget Dumpster’s business model presents a variety of unique financial concerns, including working with more than 250 partners across the country that do business — accounting, billing and otherwise — in more than 250 ways, according to the nomination. “It just simply wasn’t scalable to the next level without him,” Campbell said in an interview with Crain’s last summer. “Without a financial mind on our team, we wouldn’t have been able to get where we’re at. We needed somebody with his skill set.” Upon his arrival, Larkin overhauled Budget Dumpster’s billing and accounting processes. The group he led grew from two employ-
ees to 11 while implementing separate departments — accounts payable, accounts receivable, collections and general accounting — in order to accommodate the company’s growth. That streamlined approach, the nomination said, provided Budget Dumpster with “the financial flexibility and stability to scale the business nationally and triple revenue growth since his arrival.” Moreover, he installed a sales representative compensation system that resulted in increased revenue and decreased the need for additional sales staff. In 2015, Budget Dumpster’s revenue reached almost $30 million. The company’s leaders consider him a key driver in the firm’s revenue growth of more than 300% over three years. “Eamon embodies BD’s core values of working hard, being pleasant, having an upbeat attitude and believing in our company,” Campbell wrote in the nomination. “Because of this, he has become a daily sounding board to the 60+ folks in the company — from the co-founders on down —
on everything from strategic direction to allocating 401(k)s.” Larkin’s impact, too, extends beyond the financial realm at Budget Dumpster. For one, he leads the company’s benefits programs. Previously, the company didn’t have any sort of benefits package in place. Today, it boasts health insurance, dental insurance, vision insurance, PTO and a 401(k). He also has played an integral role in the organization’s community outreach efforts by establishing the Dumpster Donation Program — an effort that provides dumpsters and monetary donations to community projects across the United States. Beyond his dumpster-focused day job, Larkin volunteers with Court Appointed Special Advocate, or CASA, of Cuyahoga County, which supports abused, neglected and dependent children in the court system. Larkin, a graduate of the University of Dayton, also enjoys spending time with his wife, twin boys and newborn daughter. — Timothy Magaw
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CRAIN’S CLEVELAND BUSINESS
BUDISH CONTINUED FROM PAGE 1 Budish also said the county is focusing on spurring business and even personal economic growth with what he called a “continuum of innovation in Northeast Ohio.” That includes financial support, $30,000, for the Innovation Centers at three county libraries. The centers include computer stations, 3D printers and even equipment for professional embroidering. In his State of the County address earlier this year, Budish talked about including commitments to hire residents the county pledges to train or prepare for jobs in the financial incentive packages it offers to developers and growing businesses. His administration has now incorporated that goal in its economic development plan. One observer, John Corlett, president and executive director of the Center for Community Solutions, described the strategy as “marrying the economic development side of the house with the poverty-elimination side of the house.” All of those things indirectly help a community expand its business base by spurring entrepreneurship and building or attracting a more skilled workforce. It’s called placemaking in the world of business site selectors and economic development professionals. Placemaking has become increasingly important to businesses looking to expand and hire — often more important than the financial incentives government has traditional used to attract job creating businesses. Carter described how that goal was a part of discussions with the developer of the University Circle headquarters building for Explorys, an IBM Corp. subsidiary, who was seeking a $2 million county loan to help finance the building’s construction. “That company is in what we call in an industry of the future, big data in health care,” Carter said. “When we talked to them (about the loan), we said, ‘We want to make sure you are committed to considering residents of the neighborhood (Cleveland’s struggling Fairfax neighborhood) for those jobs.’ That won’t happen immediately, but as we build this career pathway program, they committed to having those residents compete for those jobs.” The program Carter described would provide residents training and with coaching and post-employment services to help them succeed in their jobs. At the same time, at the operational level, Budish has outsourced a large part of the loan-making operation to two nonprofits, easing the burden on a small, overwhelmed development department staff. He’s created an alliance with JumpStart Inc., the nonprofit organization that offers financial assistance and coaching to tech entrepreneurs in Northeast Ohio. The county has committed to lending up to $6 million to JumpStart, which, along with capital from other sources, will use the county money to invest in hightech Cuyahoga County startups. The county is also directing $2 million from its microlending program to the Economic & Community Development Institute, a Columbus nonprofit with a Cleveland office that will make loans ranging from $10,000 to $100,000 to qualified small businesses using the county money and other funds it has attracted. “We don’t have the ability, the in-
“We don’t have the ability, the in-house expertise, to evaluate, especially these startup companies. What we’re all about now is leveraging.”
house expertise, to evaluate, especially these startup companies,” Budish said. “What we’re all about now is leveraging.”
Small, but is it mighty? That lack of expertise has kept the county from being more sought after as a development partner, according to many observers, who see the department as understaffed, slow moving and lacking flexibility in making deals work. Thomas Dougherty's experience working with the county is an example of that. Dougherty is principal of Dougherty Capital Partners, a Cuyahoga Heights private equity firm. He went to the county development department looking for help on a project on East 71st Street. It fell through, he said, because it didn’t fit into one of the county’s defined
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loan programs. The department, he added, also lacked the expertise to make it work. “They are very good at what they define (as a qualifying deal), and you’ve got to put your deal through that little box,” he said “They are try-
— Armond Budish
ing to accomplish a mission with the wrong people and the wrong products.” County councilman Jack Schron, chairman of council’s economic development committee, agreed that the department isn’t operating as
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well as it could. “It is understaffed, there’s no question about it, and they need more money,” he said. “And there is a lack of consolidated money.” In response to Dougherty’s complaint, development director Carter emailed this response: “The office of development takes a balanced approach to evaluating projects that are presented — being business friendly and finding a way to make projects work, while prudently assessing and managing risk for the county and our clients in the 59 municipalities that we serve,” he said. “In this instance, the department determined that the project was not at a point to warrant an investment by the county. However, we always welcome feedback and ways to improve our performance and partnership with the private sector to facilitate job creation and investment.”
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CRAIN’S CLEVELAND BUSINESS
Business of Life
Vistas from Bar 32, on the 32nd floor of the Hilton Cleveland Downtown hotel, include a sweeping view of Cleveland’s downtown and lakefront. (Peggy Turbett for Crain’s) From left: Friday evening patrons fill the seats shortly after opening. A dirty vodka martini and a Great Lakes Nosferatu brew catch the early evening light over Lake Erie. Page Farrell and Mike Flaigis, in town from Washington, D.C for a wedding, toast the nuptials. The new Hilton Cleveland Downtown is the most recent addition to Cleveland’s skyline. Kevin O’Leary, director of food and beverage, looks out at the Great Lakes Science Museum, Rock and Roll Hall of Fame and Museum, and Burke Lakefront Airport.
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By STAN BULLARD sbullard@crain.com @CrainRltywriter
A ROOM WITH A MIGHTY NICE VIEW
The 600-room Hilton Cleveland Downtown was built next to the Huntington Convention Center to attract out-of-towners to the city, but the locals have staked out as their own Bar 32, which takes its name from a topfloor view of the city. On weekends, people regularly line up to get in as the doors open at 5 p.m., sometimes filling the entire elevator lobby. Shannon Smith, Bar 32’s manager, estimates 70% of the patrons on any given night are locals. Other patrons hail from around the world. And the globe quickly comes to mind 374 feet above 100 Lakeside Avenue as the shape of the Earth is apparent. On the open-air patio, the lake view is a show-stopper, from oreboats and sailboats plying the water to a top-down view of a jet landing at Burke Lakefront Airport. But it's also rivaled by the view of the city's skyscrapers from a similar perch. The 200-person capacity room has continued to pack in visitors, but Smith said the size of the crowd varies with the weather. A hazy day reduces the lineup, as it did on Friday, Sept. 23. Even so, patrons were lined up to get in when the doors opened. The balcony was half-filled in 10 minutes. A group of 10 filed in at 5:30 p.m. By 5:40 p.m., most of the seats in the place were staked out. Sue Dempsey of Bratenahl was among the throng that night with a visiting couple, her third trip in as many months. “This is our ’hood. I bring everyone who comes to visit here,” Dempsey said as she sat at a table on the outdoor patio. “It’s Cleveland. It’s really come up in the world. I want my family to know how well the city is doing.” Another table was occupied by four visitors from Washington, D.C., who had just checked into the Hilton and were in town for a wedding. Brad Ingalls of D.C. joked, “We heard they serve alcohol up here.” Opening night on July 1 showed the Bar 32's 15 staffers they were in for something special — and better get used to getting slammed with drink orders. One man was waiting at the door at 3:30 p.m. By the time Bar 32 opened at 5 p.m., 80 people joined him at the door. “We had 130 people in Eliot’s (Hilton’s large second-floor bar) waiting to get up here,” Smith said. Another sign Bar 32 is a special place is that four couples have gotten engaged there. “When people realize what’s going on, everyone claps,” Smith said. In that respect, Bar 32 recalls the former Top of the Town restaurant on the 35th floor of Erieview Tower, 1301 East 9th Street, from 1964 to 1995, also remembered for engagement requests and special celebrations. Kevin O’Leary, Hilton food and beverage director, would not say how much revenue the space has generated, but added, “In the planning stage, no one expected this reception. It is well above expectations.” He believes that in terms of revenue it will prove to be one of the top five of top-floor venues in the worldwide chain. “What you see again and again here,” O’Leary said, “is that people here love this city.”
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Source Lunch One of the few female owners of real estate development firms based in Northeast Ohio, Melissa Ferchill is busier with out-of-town projects than local ones. Ferchill, the daughter of Cleveland-based developer John Ferchill, launched MCM Co. two decades ago and believes female-owned firms are more accepted today than in the past. She also argues the evolution of the business may aid female developers. “It’s clearly a business that needs a lot of collaboration today,” she said. “By the time you finish financing a deal now, there are a lot of cooks in the kitchen.” The 10-person MCM Co. also operates in two other parts of the property space, as a development consultant to nonprofits and as an owner’s representative. All told, MCM has completed about $250 million in development work and $1.5 billion in work as an owner’s representative. As she was growing the business, Ferchill and husband Nick Swingos were raising three sons. Their oldest, 18, is a college freshman; the others, 15 and 12, attend Rocky River public schools. Is work-life balance an issue? “I’m good at compartmentalizing,” Ferchill said. — Stan Bullard
What is the most difficult thing about developing real estate in Cleveland? It’s hard to predict what financial institutions are requiring. A lot of financial institutions also want to be in the historic restoration space now and don’t know it very well. There are also big differences between financing offices, apartments and health care projects. How did you wind up converting a former Catholic church next to Lincoln Park in Tremont as MCM’s office? We needed more space than we had downtown. Hermes Sports and Events, where my husband is a partner, also needed more space. I would not consider an office in the suburbs. The church had been empty for years and has 40,000 square feet on almost an acre. That has a lot of impact on Tremont. We had trouble getting state historic tax credits but got them when the state began setting aside allocations for midsize projects. It relates to what we do in historic preservation. It’s the best decision I’ve made. What kind of opportunities do you see looming in the adaptive reuse of historic buildings? I’ve renovated three churches. I think they are the next big problem in major cities. There are many large, old churches that are becoming vacant. They’re also architectural landmarks, often in unbelievable locations, and a lot of them are the largest buildings in their neighborhood, so they have a lot of impact.
“Each housing development is in a different market. We look to see what we can be successful at for the next five years. I like what I do and want to continue doing it.” What do you have in the works locally? We’re nicely busy. We’re consulting for three nonprofits. We’re constructing a field house at Wittenberg University and a dorm renovation project for Heidelberg College. We’re also working for Menlo Park Academy, which plans to renovate the former Joseph & Feiss Building on the West Side as its campus. How did you wind up in real estate and pursuing historic preservation projects? I started out consulting on hospital projects, and people push you to do more. You can’t hear about real estate every night at dinner and not absorb it. My father’s first renovation project was the Guaranty Building in
Melissa Ferchill REAL ESTATE
Buffalo. There are a lot of people in it now, but the question has to be, can you get it done?
Five Things:
Where do you want MCM to be in 10 years? I don’t know. Every five years we sit down and take a look at our business. It’s not like in the past, where you could do the same thing over and over. I don’t think you can do that anymore and be successful. Each housing development is in a different market. We look to see what we can be successful at for the next five years. I like what I do and want to continue doing it.
"The Third Coast." It’s about Chicago. But I’ll read anything that’s put in front of me.
How did you wind up managing your son’s Pee Wee hockey team? We have a good coach. I’m a control freak. If I’m doing the scheduling, we can plan trips so they combine games on a weekend and we’re not traveling every weekend. It allows the parents to have a life. What is MCM up to in Detroit? We are the historic consultant for Dan Gilbert’s Bedrock Real Estate Services. That is 15 million square feet of real estate. (During lunch, five people stop by the table to chat with Ferchill.) Do you know everyone? It’s not always like this, I swear. What do you do for fun? I’m a complete sports junkie. I go to all my kids’ sports events. I watch whatever sport is on television. I binge cook. I also knit. It’s mindless and you produce something. I like to knit fingerless gloves.
WHAT ARE YOU READING?
CURRENT OBSESSION? The Tribe
FAVORITE RESTAURANT? My favorite Italian restaurant is Bucci’s in Rocky River. I like to cook and think their sauce is better than mine. My kids might have a hard time saying it, but they are close to agreeing with me.
WHERE IS YOUR CAR RADIO TUNED TODAY? Alt nation or Spectrum on Sirius.
LATEST PURCHASE? I just bought season tickets for the Cleveland State University lacrosse team. It’s their first season.
Lunch Spot THE SOUTH SIDE 2207 West 11th Street Cleveland 216-937-2288 southsidecleveland.com
The meal
Both ordered the 'Original’ turkey Cuban with bacon, Swiss cheese, pressed and grilled baguette with sun-dried tomato aioli. One took chips, the other fries.
The vibe
Lunch on the patio on a gorgeous September day, next to the old brick building that houses The South Side. Inside was busier, and louder, in a space with exposed brick and metal ceilings.
The bill
$ 22.60, with tip
CRAIN’S CLEVELAND BUSINESS
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O C T O B E R 10 - 16 , 2 016
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PA G E 3 7
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For more information or questions regarding advertising in this section, please call Lynn Calcaterra at 216-771-5276 or email: lcalcaterra@crain.com CRAIN'S CLEVELAND BUSINESS
Phone: (216) 771-5276 Contact: Lynn Calcaterra E-mail: CLBClassified@crain.com
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Dave joins Siegfried’s Philadelphia and Cleveland Markets as a Market Associate. Dave is a proud Hawk alumnus from Saint Joseph’s University, where he received his degree in marketing. Upon graduation, he spent time with Verizon Telecomm as a Business Solutions Manager and with LaFrance Corporation as a Marketing Associate.
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PA G E 3 8
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O C T O B E R 10 - 16 , 2 016 |
BANKS CONTINUED FROM PAGE 1 over the prior year. That puts it a step ahead of Huntington in the state. The FDIC now shows U.S. Bank claiming 17.9% of the Ohio market. The FDIC database doesn’t reflect the Huntington and FirstMerit merger at this point because the companies haven’t been fully integrated yet. However, with FirstMerit’s share, Huntington claims 15.5% of the market — which actually looks more like 15.2% after subtracting some Canton-area branches sold to Pennsylvania’s First Commonwealth Bank, something regulators required in the merger to break up Huntington’s control there. Huntington clearly has plans to grow throughout the Ohio market and isn’t fazed by coming in at second for now instead of first. “Huntington expected to attain No. 2 deposit market share in Cleveland with the completion of the FirstMerit acquisition,” said Huntington spokesman William Eiler. “The combination of Huntington and FirstMerit makes us stronger together and increases our competitive advantage in the market, including leading branch share to continue growing our business," he said. "We have top market deposit share in Akron, Canton, Columbus and Toledo; and No. 4 in Cincinnati. We expect to retain and grow our Ohio market positions.” Fifth Third, meanwhile, comes in a close third place with 14% of Ohio’s deposit market, where total dollars grew more than 8%. Rounding out Ohio’s top five are PNC Bank and JPMorgan Chase Bank in the No. 4 and No. 5 spots, respectively, retaining places from the prior year. Both were unaffected by unremarkable shifts in market share of a few basis points. KeyBank retained its sixth place in Ohio despite seeing its market share
CRAIN’S CLEVELAND BUSINESS
fall from 8.4% to 6.8%, which could be attributed in part to an apparent shifting of deposit dollars.
Key (seemingly) loses ground in Cleveland In Key’s hometown in the Cleveland MSA, the bank saw its market share dip 4.8 percentage points. Key now controls 23.29% of this market, according to the FDIC. It’s still in first place. But that’s a significant drop without divesting any deposits. But Key says there’s a good explanation for that. A spokeswoman for Key said the bank maintains that its market share has actually grown from the prior year and that the FDIC is showing outdated numbers. “Key restated its 2015 Summary of Deposit numbers to address large fluctuations in the Cleveland and Albany regions caused by the intra-company movement of public sector deposits,” said Kim Kowalski, Key’s communications manager for the Great Lakes region. So a timing issue of when those numbers were reported may be a main factor in that drop in market share. “Key’s market and deposit shares in the Cleveland district have grown steadily over the past several years, and 2016 is no exception,” Kowalski said. It could be a month or two before updated figures are reflected in the FDIC’s database. Adding FirstMerit’s Cleveland share to Huntington’s shows that the Columbus-based bank will jump from fifth place to second, controlling 13.89% of the market. Last year, it claimed 7.59%. So Huntington falls between KeyBank and PNC Bank, which narrowly falls from second place to third with 13.62% of the market. That reflects growth of 1.4 percentage points from the prior year for PNC.
“The combination of Huntington and FirstMerit makes us stronger together and increases our competitive advantage in the market, including leading branch share to continue growing our business. We have top market deposit share in Akron, Canton, Columbus and Toledo; and No. 4 in Cincinnati. We expect to retain and grow our Ohio market positions.” — William Eiler, Huntington spokesman
But Citizens gains the most Citizens Bank, meanwhile, appears to have logged the largest organic growth in this market from the prior year, growing just shy of 3 percentage points to claim 11.87% of the Cleveland market. That would’ve been more than enough to retain its No. 3 spot, but Huntington’s growth pushes Citizens down to No. 4. Huntington now controls about 13.9% of the market, gaining ground by more than 6 percentage points on the back of its merger.
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Citizens, notably, has been in a growth mode since being unshackled by the Royal Bank of Scotland — the bank’s former overseas parent company that acquired Citizens in 1988 to break into the U.S. market, only to retreat from it a couple decades later. When Citizens chairman and CEO Bruce Van Saun met with investors in Cleveland this summer, he discussed the company’s growth plans as an independent company, which includes gaining ground throughout the Midwest. The growing market share is at least one indication the bank is resonating with customers. “While deposits are one way to measure growth, our focus in becoming a top-performing regional bank is on deepening client relationships by offering advice and providing personalized solutions that address our customers’ financial needs,” said Citizens spokeswoman Lauren DiGeronimo.
Huntington dominates Akron FirstMerit’s solid hold on the Akron market now transfers to Huntington. Without the merger, the local bank grew its market share in the Akron MSA almost 4 percentage points, according to the FDIC, pulling away from the No. 2 competitor Chase Bank. Huntington, by itself, held on to fifth place there. But with the merger (and factoring in the sold deposits), Huntington jumps to the top spot, controlling 33.7% of that market. That widens the gap with Chase significantly, which claims about 13%. In the third and fourth spots are PNC and Key, respectively. The $735 million in deposits shed in the Huntington and FirstMerit merger that were acquired by First Commonwealth composes about 5% of the total Akron market. That would effectively rank the Pennsylvania bank sixth in that market, sandwiched between
Fifth Third bank in the No. 5 spot and Citizens Bank just below it. Those companies, along with PNC and Key, saw unremarkable downward shifts in share of a few basis points each.
Opportunity for smaller banks With FirstMerit out of the picture, the Cleveland market comprises 35 banks. Akron has 27. When going down the list, after the top 10 banks in each market, the remaining banks all claim slivers of shares ranging from about 2% to a couple basis points. It’s a demographic mostly populated by local Ohio community banks, with a few exceptions. Of the top 10 in both Cleveland and Akron, only a couple actually grew market shares overall organically. In Akron, every one of the top 10, except for Huntington, saw shares drop a couple basis points. But Akron saw the total level of deposits grow more than 8% to about $14.4 billion. In Cleveland, total deposits grew about 1.5% to $64.6 billion. In effect, while the smaller banks saw growth that’s quite small in the bigger picture, this combined block is claiming newer deposits and chipping away at the existing market. Community banks quietly are gaining ground on their own, capitalizing on fallout and succesfully drawing new customers. So while these banks will never control the same swaths of the market at their size, in terms of competition, they're far from irrelevant. “There’s still a lot of business to go around” Crowley said. “For those community banks, they would tend to see a lot of opportunity because the market is so concentrated right now with large regional and super-regional banks who may not, in all cases, be as focused day to day on operations in Greater Cleveland as they are in other markets.”
CRAIN’S CLEVELAND BUSINESS
The List NAME OF COLLEGE OR UNIVERSITY THIS ADDRESS YEAR PHONE/WEBSITE
|
O C T O B E R 10 - 16 , 2 016
|
PA G E 3 9
LARGEST COLLEGES AND UNIVERSITIES
Ranked by Fall 2016 full-time equivalent enrollment
FULL-TIME EQUIVALENT ENROLLMENT FALL 2016
FALL 2015
STUDENT TO FACULTY % CHANGE RATIO
% OF ENROLLMENT TYPE OF ANNUAL TUITION; UNDERGRADUATE; INSTITUTION; AFFILIATION GRADUATE ROOM & BOARD
OPERATING BUDGET (MILLIONS); ENDOWMENT YEAR FOUNDED ($ MILLIONS) PRESIDENT
1
Kent State University P.O. Box 5190, Kent 44242 (330) 672-3000/www.kent.edu
30,232
31,724
-4.7%
21:1
$10,012.0 $10,720.0
83.0% 17.0%
4 year public
$686.3 1910
$114.6
Beverly Warren
2
University of Akron 302 Buchtel Common, Akron 44325 (330) 972-7111/www.uakron.edu
19,011
20,724
-8.3%
19:1
$10,270.0 $10,686.0
82.0% 18.0%
4 year public
$354.2 1870
$215.0
Matthew J. Wilson
3
Cleveland State University 2121 Euclid Ave., Cleveland 44115 (216) 687-2000/www.csuohio.edu
16,949
17,260
-1.8%
17:1
$9,636.0 $12,000.0
73.0% 27.0%
4 year public
$247.2 1964
$72.7
Ronald M. Berkman
4
Cuyahoga Community College 700 Carnegie Ave., Cleveland 44115 (216) 987-6000/www.tri-c.edu
13,579
14,256
-4.7%
17:1
$3,136.2 NA
100.0% 0.0%
2 year public
$345.8 1963
$63.8
Alex Johnson
5
Case Western Reserve University 10900 Euclid Ave., Cleveland 44106 (216) 368-2000/www.case.edu
10,820
10,587
2.2%
11:1
$45,592.0 $14,298.0
44.0% 56.0%
4 year private
$1,083.1 1826
$1,776.0 (1)
Barbara R. Snyder
6
Youngstown State University One University Plaza, Youngstown 44555 (330) 941-3000/www.ysu.edu
10,389
10,034
3.5%
16:1
$8,087.0 $8,990.0
89.3% 10.7%
4 year public
NA 1908
NA
James Tressel
7
Lorain County Community College 1005 N. Abbe Road, Elyria 44035 (800) 995-5222/www.lorainccc.edu
6,431
6,470
-0.6%
20:1
$3,077.0 NA
100.0% 0.0%
2 year public
$66.0 1963
$44.0
Marcia J. Ballinger
8
Stark State College 6200 Frank Ave. NW, Canton 44720 (330) 494-6170/www.starkstate.edu
6,420
6,714
-4.4%
21:1
$2,796.0 NA
100.0% 0.0%
2 year public
$61.2 1960
$5.3
Para M. Jones
9
Ashland University 401 College Ave., Ashland 44805 (419) 289-4142/www.ashland.edu
5,198
4,280
21.4%
12:1
$19,448.0 $9,602.0
69.0% 31.0%
4 year private
$79.7 1878
$36.0
Carlos Campo
Lakeland Community College 7700 Clocktower Drive, Kirtland 44094 (440) 525-7000/www.lakelandcc.edu
4,595
4,674
-1.7%
20:1
$3,315.0 NA
100.0% 0.0%
2 year public
$57.1 1967
$0.0
Morris W. Beverage
Baldwin Wallace University 275 Eastland Road, Berea 44017 (440) 826-2900/www.bw.edu
3,588
3,575
0.4%
13:1
$30,776.0 $8,748.0
84.0% 16.0%
4 year private
$129.6 1845
$153.7
Robert C. Helmer
10
The List 11
NAME OF COLLEGE OR UNIVERSITY THIS ADDRESS YEAR PHONE/WEBSITE
LARGEST COLLEGES AND UNIVERSITIES
Ranked by Fall 2016 full-time equivalent enrollment
FULL-TIME EQUIVALENT ENROLLMENT
SOUND SOLUTIONS FOR NOT-FOR-PROFITS OPERATING
BUDGET Pam Lebold + maloneynovotny.com + 216.363.0100
FALL 2016
FALL 2015
STUDENT TO FACULTY % CHANGE RATIO
% OF ENROLLMENT TYPE OF ANNUAL TUITION; UNDERGRADUATE; INSTITUTION; AFFILIATION GRADUATE ROOM & BOARD
(MILLIONS); ENDOWMENT YEAR FOUNDED ($ MILLIONS) PRESIDENT
12
John Carroll University 1 John Carroll Blvd., University Heights 44118 (216) 397-1886/www.jcu.edu
3,173
3,525
-10.0%
14:1
$37,190.0 $11,250.0
87.0% 13.0%
4 year private
$85.0 1886
$187.7
Rev. Robert L. Niehoff, S.J.
13
Oberlin College 101 N. Professor St., Oberlin 44074 (440) 775-8460/www.oberlin.edu
2,903
2,919
-0.5%
9:1
$51,324.0 $14,010.0
99.4% 0.6%
4 year private
NA 1833
NA
Marvin Krislov
14
University of Mount Union 1972 Clark Ave., Alliance 44601 (800) 992-6682/www.mountunion.edu
2,262
2,167
4.4%
13:1
$29,120.0 $9,850.0
94.0% 6.0%
4 year private
$54.0 1846
$140.0
Richard Merriman
15
Walsh University 2020 E. Maple St. NW, North Canton 44720 (330) 490-7090/www.walsh.edu
2,130
2,229
-4.4%
15:1
$27,220.0 $10,240.0
78.5% 21.5%
4 year private
$76.2 1960
$22.6
Richard Jusseaume
16
The College of Wooster 1189 Beall Ave., Wooster 44691 (330) 263-2000/www.wooster.edu
1,990
2,036
-2.3%
12:1
$46,860.0 $11,040.0
100.0% 0.0%
4 year private
NA 1866
$280.0
Sarah Bolton
17
Notre Dame College 4545 College Road, South Euclid 44121 (216) 381-1680/http://notredamecollege.edu
1,618
1,610
0.5%
16:1
$28,300.0 $9,550.0
90.0% 10.0%
4 year private
$27.0 1922
$7.6
Thomas G. Kruczek
18
Malone University 2600 Cleveland Ave. NW, Canton 44709 (330) 471-8100/www.malone.edu
1,509
1,556
-3.0%
11:3
$28,524.0 $9,028.0
77.9% 22.1%
4 year private
$32.2 1892
$17.6
David A. King
19
Northeast Ohio Medical University 4209 State Route 44, Rootstown 44272 (330) 325-2511/www.neomed.edu
959
916
4.7%
11:1
$39,121.0 NA
0.0% 100.0%
4 year public
$56.5 1973
$15.9
Jay Alan Gershen
20
Hiram College P.O. Box 67, Hiram 44234 (330) 569-3211/www.hiram.edu
950
991
-4.1%
10:1
$31,440.0 $10,190.0
97.8% 2.2%
4 year private
NA 1850
$72.0
Lori E. Varlotta
21
Ursuline College 2550 Lander Road, Pepper Pike 44124 (440) 449-4200/www.ursuline.edu
726
736
-1.4%
8:1
$29,640.0 $9,964.0
43.0% 57.0%
4 year private
$29.0 1871
$38.7
Christine De Vinne, O.S.U.
22
The Ohio State University Agricultural Technical Institute 1328 Dover Road, Wooster 44691 (330) 287-1331/ati.osu.edu
681
708
-3.8%
16:1
$7,104.0 $11,666.0
100.0% 0.0%
2 year public
$1.6 1969
NA
Thomas Janini
23
Lake Erie College 391 W. Washington St., Painesville 44077 (440) 296-1856/www.lec.edu
481
510
-5.7%
14:1
$29,162.0 $9,178.0
80.0% 20.0%
4 year private
NA 1856
NA
Brian D. Posler
24
Cleveland Institute of Music 11021 East Blvd., Cleveland 44106 (216) 791-5000/www.cim.edu
422
421
0.2%
4.5:1
$47,200.0 NA
53.0% 47.0%
4 year private
NA 1920
NA
Paul W. Hogle
RESEARCHED BY CHUCK SODER Information is supplied by the schools unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are available for purchase at www.crainscleveland.com. (1) Market value as of June 30, 2015, the latest figure available.