October 14-27, 2014 Section A

October 14-27, 2014 lbbusinessjournal.com

HealthWiseBreast Care 101 –MammogramsAnd PreventionSee Page 23

The College

Of Business

Administration

At CSULB

CBA Center For Studen

t

Success: Putting

Student Success First

See Pg. 4

BNSFTrial Date SetFor LawsuitAgainst ProposedRailway Project

Going GreenNew MandatesLoom ForRecycling � By SAMANTHA MEHLINGER

Senior Writer

A ssembly Bill (AB)1826, approved by Gov.

Jerry Brown in September,expanded on existing solidwaste recycling regulationsand added new organic wasterecycling requirements forbusinesses, including multi-family buildings with five ormore units. The City of LongBeach already has organic andsolid waste recycling programsin place that may help local

Fostering ASustainable City � By SAMANTHA MEHLINGER

Senior Writer

E very year, the City ofLong Beach’s Office of

Sustainability and its corre-sponding Sustainable CityCommission with communityrepresentatives from eachcouncil district, create a set ofpriorities for sustainableefforts to support throughoutthe year. These priorities areoutlined in the SustainableCity Commission Work Planas well as in a correspondingplan for city staff in the sus-tainability department.Priorities typically align

with projects rolled over fromprevious years or projectsbeing worked on in conjunc-tion with other city depart-

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Hilda Sanchez Elected Chair Of The DLBAHilda Sanchez has been elected chair of Downtown Long Beach Associates(DLBA) Board of Directors. The DLBA is the nonprofit organization overseeingdowntown’s business improvement district on behalf of tenants and commercialand residential property owners. Sanchez operates Minuteman Press, locatedat 137 W. 5th St., which she opened with her husband in 2002. She has beena member of the DLBA’s board since 2008. In a letter posted on the DLBA’swebsite, Sanchez said as chair she is going to focus on business recruitmentand retention. “The East Village has become a true destination for shoppers, theenergy on Pine Avenue is moving further north and the Promenade is a foodie

delight, but there arestill plenty of store-fronts to be filled.There is alwaysroom to improve ourshopping and diningscene, and I look for-ward to directingour efforts towardthis goal,” shewrote. To learn moreabout the DLBA, visitwww.down town -l o n g b e a c h . o r g .(Photograph by theBusiness Journal’sThomas McConville)

� By BRANDON FERGUSON

Staff Writer

R ecent murmurings fromcity officials suggest Long

Beach is losing out when it comesto generating sales tax revenue.At the September 9 meeting ofthe city council, 5th DistrictCouncilmember Stacy Mungosaid by some estimates the city ismissing out to the tune of $18million annually. In recent discussions with the

Business Journal, the city’sdirector of the new economicand property developmentdepartment, Mike Conway, saidthat, in comparison to other LosAngeles County cities, LongBeach is falling behind when itcomes to generating sales taxrevenue. Conway explained Long

Beach plans to develop some ofits former redevelopment agency

properties, adding that, while thecity wants to adhere to thewishes of residents in develop-ing the properties, it also wantsto boost its flagging sales tax

revenue with the projects itchooses.This got staffers at the Business

Journal wondering about the

High TechL.A. Area’s Hidden, Hard-WiredTech Ecosystem: 368,000 Jobs And $108 Billion In GDP� By MICHAEL GOUGIS

Contributing Writer

L os Angeles isn’t all aboutHollywood, movie starlets

and media moguls. The region is ahard-wired, high-tech network,and that segment of the region’seconomy is the largest techemployer of any metro area in thenation, according to a new report.The high technology sector is a

major financial component ofSouthern California’s economic

health, responsible for more thannine percent of the jobs in LosAngeles County, according to“High Tech in LA – ItsEmployment and EconomicContribution in 2013.”The analysis, conducted by the

Los Angeles County EconomicDevelopment Corp.’s Institutefor Applied Economics, con-cluded that the high tech sectorwas responsible for more jobsthan the entire manufacturingsector in Los Angeles, threetimes the number of jobs that theconstruction industry generates– and five times the number ofjobs in the arts and entertain-ment sector.Christine Cooper, vice presi-

dent, Economic and Policy

California VotesA Breakdown Of The State Ballot Propositions For November Election� By BRANDON FERGUSON

Staff Writer

T his November, in additionto selecting various public

officials, voters will decide thefate of six statewide Propositions.Issues include a massive bondmeasure to fund water-related pro-grams, increased regulation of thehealthcare industry to Indian gam-ing compacts. Here’s a breakdown

of what voters need to know aboutthese propositions before steppinginto the ballot box.Will Prop 1 Provide Water ForDrought-Stricken State, OrLeave Residents All Wet?Proposition 1, which is sup-

ported by Gov. Jerry Brown andthe California Chamber ofCommerce (CalChamber), wouldauthorize the sale of $7.1 billion





Retail SalesLong Beach Women Sound Off On What They Want When It Comes To Shopping Options


Staff Writer

W hile at least one publicofficial has openly

hinted at a potential settlement inthe city’s lawsuit against LosAngeles and the BNSF railroad,for now Long Beach is rollingahead with plans to litigate.Assistant City Attorney

Michael Mais recently told theBusiness Journal a trial date ofNovember 16, 2015, has been set,at which time a judge will hearclaims by several entities thatBNSF and the City of LosAngeles violated the CaliforniaEnvironmental Quality Act byapproving a $500 million rail yardproject in Wilmington. BNSF plans to build the rail-

yard near the Terminal IslandFreeway between SepulvedaBoulevard and Pacific CoastHighway. Opponents of the proj-

FOCUS ON THE GOODS

MOVEMENT INDUSTRYSee Section APages 25-40

FOCUS ON THE GOODS

MOVEMENT INDUSTRY

Presented By The Long Beach Business Journal • October 2014

1_LBBJ_Oct14_SectionA_LBBJ MASTER LAYOUT 10/13/14 4:27 PM Page 1

INSIDE THIS ISSUE2 Long Beach Business Journal October 14-27, 2014

4 Newswatch4-Mayor Issues Recommendations For City Commissions4-Long Beach City Hall News In Brief8-Urban Land Institute’s Report On Waterfront8-Jane Netherton Recognized By Marathon’s Run Racing10-MemorialCare Foundation Acquires Imaging Centers11-Dining, Entertainment Permitting For Downtown Revised

12 Going Green12-Recycling Deadline Looms, continued from Page 114-Fostering A Sustainable City, continued from Page 1

16 Mobility16-Pedestrian Planning Efforts Underway For Parts Of City

18 The Tech Sector18-Hi-Tech Jobs Lead Nation, continued from Page 118-New App Schwag, Aims To Drive Customers To Your Site

20 Ballot Propositions20-Propositions On November Ballot, continued from Page 120-Future Home Of LBCC’s Nursing Department

22 PerspectiveRealty Views Foreign Real Estate Investment On The UpswingBy Terry RossEffective Leadership Google’s Eight Ways To Build ABetter Boss By Mick UklejaHealthWise Breast Care 101 – Mammograms AndPrevention By Dr. Homayoon SanatiEarthTalk Palm Oil Production And Rainforest Destruction

InsertsThe Goods Movement Industryand Celebrating The 20thAnniversary Of CommunityHospital Long Beach

DIGITALedition

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THREE FOR FREE . . .GET ALL

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NEWSWATCH4 Long Beach Business Journal -October 14-27, 2014

Mayor Garcia Announces SeveralMore Commission Appointments


Staff Writer

Last Week Mayor Robert Garcia announced his recommen-dations for 13 commission appointments. If approved by thecity council, the appointees will fill positions on five differentgoverning bodies: The Long Beach Planning Commission,The Long Beach Transportation Company Board of Directors,The Airport Advisory Commission, The Marine AdvisoryCommission and the Long Beach Community InvestmentCompany.

Individuals recommended by Garcia represent a wide rangeof backgrounds from environmental business leaders, to cityplanners. Two appointees have union backgrounds – JaneTemplin is vice president of the International Brotherhood ofElectrical Workers Local 11, and Gerald Avila is the healthbenefits officer for the International Longshore Workers’Union Local 13. Templin is recommended for a position onthe planning commission, and Avila, a position on the marineadvisory commission.

“I’m proud to appoint a slate of exceptional communityleaders who love Long Beach and have the experience tomove our city and our commissions forward,” Garcia said in astatement. “Commissions are an important part of our democ-racy, and I’m thankful to these citizens for their willingness toserve.”

Of the 13 proposed appointments, four are recommended

for the planning commission – these will go before the civilservice committee for review before being considered by thecity council. The rest, which are non-charter appointments,will go before the city council for approval on October 21.

The list of appointees by commission is as follows, alongwith the number of members and the commission’s purpose aslisted on the city’s website:Planning Commission (7 members; advises the mayor and

city council on all matters affecting development of the city’sgeneral plan, zoning, and ordinances to guide the implemen-tation of long range planning) – Mike Logrande, Andy Perez,Jane Templin, Erick Verduzco-Vega.Long Beach Transportation Company Board of

Directors (7 members; to operate a public transportation sys-tem in the City of Long Beach and surrounding areas; to pur-chase, acquire, lease, finance, maintain, expand, and super-vise the system and all related matters) – April Economides,Sumire Gant, Nancy Pfeffer, Mary Zendejas.Airport Advisory Commission (9 members; works closely

with the community, aviation groups, businesses, pilot groupsand airport staff in order that they may effectively advise themayor and city council on policy matters regarding the LongBeach Airport development) – Jeff Anderson.Marine Advisory Commission (9 members; advises city

council in formulating policies, analyze special requests, con-duct hearings of appeal, and study problem areas involvedwith the city’s beaches, marinas and waterways. ) – GeraldAvila, Peter Schnack.Long Beach Community Investment Company (7 mem-

bers; advises the mayor and city council on development andcommunity investment) – Russ Doyle and Sabrina Sanders.

Long Beach City Hall News In Brief� By BRANDON FERGUSON

Staff Writer

Special Council Meeting – Tonight (October 14) the coun-cil holds the second in a series of study sessions focused onplans to build a new civic center complex. The meetingincludea presentations by the two companies bidding todesign and build the proposed center: Long Beach CivicCoreAlliance and Plenary-Edgemoor Civic Partners. The meetingis at 4 p.m. in city council chambers at city hall.Marijuana Businesses –The planning commission consid-

ers on October 16 an item recommending the city councilestablish conditions and prohibitions on the establishment andoperation medical marijuana businesses. If approved, a limitof two such businesses would be allowed in each of the city’snine council districts. Marijuana businesses would not beallowed in residential zones. The planning commission meetsat 5 p.m. in the city council chambers.Technology Commission – Tonight, the city council con-

CBA Center ForStudent Success:Putting StudentSuccess First

Student success is themain focus for the Collegeof Business Administration’s(CBA) Center for StudentSuccess. The Center is bothan advising and studentresource center that providescomprehensive academicadvising and academic sup-port, and promotes personaland academic success to allbusiness majors.

The Center has a “team”of advisors prepared toensure continuity and con-

sistency of academic information provided toundergraduates. Collaboration with faculty,staff, and students, as well as other advisingunits has allowed the center to build relation-ships on a collegial level putting student successfirst. The main goal of our Center is to easetransition, increase graduation rates, and focuson career preparedness. This year, the Centerreceived the 2014 CSULB OutstandingImprovement in Student Success Award for out-standing improvement in Student Retention andGraduation Rates.

Through our Center, students receive servicessuch as assistance with registration, use of cam-pus resources, major and General Educationgraduation requirements, study abroad, programplanning, walk-in quick question advising, coursesubstitutions/equivalencies as well as MandatoryFreshmen and Transfer Advising workshops tohelp new students plan for academic success, aswell as provide continued guidance through grad-uation. In addition, we provide prospective stu-dents the opportunity to learn about necessarypreparation and admission criteria to become aCSULB business student through TransferAdmissions Workshops and Preview Days.

Our next outreach event is our CBA OpenHouse, scheduled for Saturday, October 4, 2014.The focus of the Open House is to welcomeprospective students to CSULB and provide themwith information on what CBA offers and anoverview of our admission process. Students willlearn about CBA programs and requirementsfrom faculty, staff and current students.Participants will learn about the type of profes-sional development and internship opportunitiesavailable through the Student Center forProfessional Development and a multitude of stu-dent organizations. Members of AssociatedBusiness Students Organization Council, as wellas representatives of campus life and resourceswill be available to share how students can getinvolved in activities for career building and pro-fessional networking. (The College of Business Administration at Cal

State Long Beach is an AACSB accredited busi-ness school that provides undergraduates andMBAs with the knowledge and skills necessary tobe successful in their careers and to propel theeconomic development of our region.) �

By Dr. Jennifer AmesOsborne, Director,College of Business

Administration’sCenter for

Student Success

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Pictured are the members of the Long Beach Fire Department Recruit Academy 2014A Class. Front row from left are (last names only were providedto the Business Journal): Abbott, Nguyen, Corlett, Trgovac, Meng, Veyna, Lam, Metzbrown, Crawford, Metz, Montero, Chonka, Wu and Vasquez.Back row from left are: Brown, Greer, Moss, Pena, Ortiz, Jackson, Eng, Daniel, Sweeney, Ferguson, Webb, Olmstead, Garcia and Lawson.(Photograph provided by the City of Long Beach)

Jonathan Jaques Children’s Cancer Center (JJCCC) patients, familiesand supporters prepare to greet Long Beach firefighters, police officersand lifeguards with warm towels after the 28-mile long Catalina SwimChallenge. The relay race started at 9 p.m. on October 3 from theshores of Catalina Island. In all there were five teams, consisting of 33swimmers and 15 paddlers. The racers took turns swimming 30-minutelegs with paddlers and six boats in the water next to them to monitorfor sharks. Funds raised from the relay benefit pediatric cancer researchprogams at JJCCC at Miller Children’s Hospital Long Beach.(Photograph provided by Miller Children’s Hospital)


siders an ordinance to establish a technol-ogy and innovation commission. The com-mission was first mentioned as part ofMayor Robert Garcia’s budget recommen-dations, which were announced in July.According to the ordinance, the purpose ofthe commission is to advise the city councilon new technology, assess new technologyto assist the city in improving efficiency aswell as support and assist in the strategicdirection and implementation of informa-tion technology and communication.Business Improvement Districts – Two

items on tonight’s (October 14) regular citycouncil agenda focus on two of the city’sbusiness improvement districts. First, the

council will decide whether or not toapprove the Long Beach Tourism BusinessImprovement Area program (LBTBIAP)assessment for FY15. The city estimatesthe district, which benefits the city’s con-vention and visitors bureau (CVB), willgenerate $4,240,950. In its annual report,the LBTBIAP reported that duringFY13/14 the CVB participated in 29 salesshows nationwide, conducted four salesmissions in an effort to bring conventionsto Long Beach and conducted five “famil-iarization trips.” The latter are aimed atfamiliarizing meeting planners from acrossthe country with the Long Beach area in aneffort to bring conventions to town.

EASBA Renewal – The city council willalso consider approving the assessment forthe East Anaheim Street Parking andBusiness Improvement Area for FY15.District boundaries are: Junipero Avenue tothe west, Pacific Coast Highway to theeast, 11th Street to the south, 14th Street tothe north. Estimated revenue for the fiscalyear is approximately $140,000.Tracking Commission Appointments –

The council received a report from themayor’s staff on a new system for trackingcommission appointments and receivingcommission applications. The new systemwas introduced at the council retreat heldon August 16. The system was launched

last week and is viewable on the city’s web-site. The new system allows visitors to thewebsite to view commission descriptionsand vacancies, and easily apply for open-ings online. Crossing Guards – On October 7, the

Long Beach City Council voted 8-0 torequest City Manager Patrick West to pro-vide a report within 60 days on the status ofthe Pedestrian Safety Advisory Committeeand an overview of the city’s school cross-ing guard program. Long Beach votersestablished the pedestrian safety advisorycommittee in 1978 to oversee the installa-tion of adult crossing guards at hazardous

NEWSWATCHOctober 14-27, 2014 Long Beach Business Journal 5



NEWSWATCH6 Long Beach Business Journal October 14-27, 2014

crossings. The committee is comprised of arepresentative from each council district arepresentative of the Long Beach UnifiedSchool District, the city’s traffic engineer arepresentative of non public schools in theLong Beach area and the president of theparent teacher association in Long Beach.Fourth District Councilmember PatrickO’Donnell was absent for the vote.Beach Path – At its October 7 meeting

the city council voted 8-0 to authorize con-struction of 3.1-mile-long pedestrian pathnorth of the existing bike path north alongshoreline. The vote awarded the contractfor the 11-foot-wide path to PowellConstructors Inc. of Fontana. The amountof the contract is not to exceed $6,347,655.According to city documents, the path is tobe constructed from a resin-based surfaceless rigid than concrete and better suited towalking and running. The project isexpected to involve relocating portions ofthe existing bike path inland at a few loca-tions and include new pedestrian and bicy-cle ramps at the Belmont VeteransMemorial Pier.NAACP Park – By a vote of 8-0, the city

council voted on October 7 to approve arecommendation to name the park locatedat 2300 Martin Luther King Jr. Ave. theNational Association for the Advancementof Colored People (NAACP) FreedomPark. The agenda item was sponsored by

3rd District Councilmember Suzie Price,Councilmember O’Donnell and 7thDistrict Councilmember Dee Andrews. Therecommendation will now be consideredby the City Council’s Housing andNeighborhoods Committee and the LongBeach Parks and Recreation Commission.If approved, this will be the first parknamed in honor of the NAACP in theUnited States.Memorial Park – The city council con-

siders naming a public right of way parklocated on Walnut Avenue at 20th Street theJenni Rivera Memorial Park. Rivera is aLatin Grammy nominated singer who wasborn in Long Beach. In 2010, she wasnamed a spokeswoman for the nationalcoalition against battered women anddomestic violence.Affordable Senior Housing – The city

council voted 8-0 to adopt a resolutionapproving the issuance of $13,000,000worth of revenue bonds by the CaliforniaMunicipal Finance Authority (CMFA).The bonds are being issued on behalf ofthe Volunteers of America, which pro-vides nursing care for the elderly andoperates convalescent centers nationwide.Proceeds from the bonds will fund theacquisition and rehabilitation of a 75-unitmulti-family senior rental housing facil-ity located at 1451 Atlantic Ave. The proj-ect will remain affordable to low-incomeseniors for a period of 55 years. Thoughno city funds will be used to supportfinancing of the project, the IRS requiresthe CMFA to seek approval from the city

Long Beach City HallNews In Brief(Continued From Page 5)



council in order to issue bonds benefitingcity facilities. Councilmember O’Donnellwas absent for the vote.Health Plan – By a vote of 7-0 the city

council approved renewal of contractswith Anthem Blue Cross and other organ-izations providing health care insurance,as well as dental and eye care insurancefor city employees. The city’s projectedcost for health care, dental, vision and lifeinsurance for Fiscal Year 2015 (FY15) isestimated at $66.5 million.Councilmembers O’Donnell andAndrews were absent.Gulfstream – The city council consid-

ers tonight authorizing City ManagerWest to execute the seventh amendmentto the lease agreement between the cityand Gulfstream Aerospace Corporation.Since 1987 the city has leased propertylocated at 4150 Donald Douglas Dr. toGulfstream, which operates the onlyGulfstream Service Center on the westerncoast of the United States. The currentlease expires on March 23, 2018.However terms of the lease allow twofive-year extension options. As part of theamended agreement, the city seeks toreclaim a 13,000-square-foot rectangulararea outside the Gulfstream securityfence to be used for future improvementsto traffic lanes on Donald Douglas Drive.According to city documents, Gulfstreamis agreeing to the request. Covered California – At tonight’s

meeting, the city council considersauthorizing City Manager West to enter

into an agreement with the CaliforniaHealth Benefits Exchange to accept fund-ing in the amount of $225,267. Themoney will be used to facilitate outreach,enrollment and retention into the healthinsurance programs offered throughCovered California. If approved, theauthorization allows for a one-yearrenewal and cash bonus contingent uponachieving enrollment goals.Community Challenge – Tonight the

city council considers requesting CityManager West to work with the administra-tion of President Barack Obama to providea report within 90 days on the programknown as My Brother’s KeeperCommunity Challenge. The report focuseson matters related to youth jobs, intern-ships, living wages and violence preventionfor boys and men of color in Long Beach.The My Brother’s Keeper Initiative waslaunched by President Obama in February2014 to address opportunity gaps faced byboys and young men of color.Parking Meter Revenue – At its

October 16 meeting, the Belmont ShoreParking and Business Improvement AreaAdvisory Commission is considering anitem to transfer $2,200.46 of collectedparking meter revenue to the Bay ShoreLibrary. The meeting begins at 9 a.m. andtakes place at the Bay Shore Library 195Bay Shore Ave.City Council Meeting Cancelled – The

city council voted 8-0 to cancel theNovember 4 meeting in observance of elec-tion day in California. �




Staff Writer

Last week the Urban Land Institute(ULI) released its final report outliningsuggestions for improved pedestrian con-nectivity between downtown and thewaterfront area. Included in the more-than-20-page document were suggestionsto deactivate traff ic lanes along theGrand Prix route (when the event is nothappening), as well as improvedwayfinding and signage between down-town and the waterfront.The waterfront report was commissioned

by the Downtown Long Beach Associates(DLBA), which paid roughly $25,000 tothe non-profit ULI to conduct a study ofthe area and make recommendations. The ULI convened a technical assistance

panel (TAP), which spent two days in Julyand August interviewing stakeholders andresidents in the area. The TAP was com-prised of a team of urban planners, hospi-tality industry consultants and architects.Headed by Richard Bruckner, director ofthe Los Angeles County Department ofRegional Planning, the TAP team issuedpreliminary findings at an August 1 pres-entation at the Aquarium of the Pacific.Specific recommendations in the final

report included an examination of theGrand Prix route, which runs alongShoreline Drive. The report suggested a“road diet” for the asphalt strip nearShoreline Village, essentially reducing thenumber of lanes in use on the street. Theeastbound traffic lane on the southside ofthe Shoreline Drive median would be con-verted into angled parking spaces andopen space for pedestrian activity.According to the report, this recommen-dation was made in an effort to “improvethe waterfront as a draw for tourists and asa welcoming place for the day-to-day usesof Long Beach’s residents.” The report also included an examination

of the underutilized lot located at the south-eastern corner of Pine Avenue and OceanBoulevard, which could be used as a “vitalplace for residents and visitors.” Until theparcel is ready for permanent development,the TAP panel recommended using thespace for “pop-up” restaurants and farmersmarkets on weekends. Removal of the con-struction barrier along Pine Avenue wasalso recommended.Multiple physical improvements were

suggested along multiple north-southcorridors in the downtown core(Alamitos Avenue, Pine Avenue), includ-ing signage and wayfinding to “create aseamless user experience for visitors andlocals navigating the streets of the areaby foot or transit.” The report mentioned,as an example, a program in NorthCarolina known as Walk Raleigh, whichmakes use of signage to notify pedestri-ans of direction and length of walk timesto specific destinations.Other suggestions included pedestrian

routes through the performing arts centerallowing access to the waterfront, anchor-ing the Linden Avenue arts district corridorwith a café or bike shop and switching theMarina Green space in front of theShoreline Yacht club with the parking lot to

create a more inviting green corridor withscenic views facing the bay.In order to implement some of the rec-

ommendations contained in the report, theTAP panel suggested involvement fromcity government and coordination amongthe mayor, city council and city manager.“Examples of the tasks that may appro-

priately be considered at this level of man-agement include comprehensively manag-ing parking and open space, negotiating theGrand Prix agreement, moving forwardwith investments required to improve pub-lic open space along Marina Green Parkand at Rainbow Lagoon Park, and financ-ing operations and capital improvements inthe study area,” the report read.The Business Journal reached out to

Debra Fixen who is the property managerat Shoreline Village to get her opinion on

the report’s recommendations. While sheexpressed support for a plan to providemore parking along the Grand Prix route,her concerns about potential pop-up restau-rants at Pine and Ocean highlight the chal-lenges of pursuing a unified vision amongthe area’s diverse stakeholders. “We have a lot of restaurants available

downtown, [at] the Pike, [and] here atShoreline Village. So sometimes thatbusiness suffers if you have too many,”Fixen said. “Those [restaurants] are pay-ing big-time rents, whereas somebody thatwas in a pop-up or food truck would havevery little expense.”Before planning for the area begins in

earnest, the DLBA will first hand thereport over to its public realm committee.Sean Warner, placemaking manager for theDLBA, told the Business Journal the goal

is to identify a way to move forward withthe suggestions.“I’ll be working with [the public realm

committee to] prioritize the recommenda-tions and identify an action plan. Kind ofidentify what we’re already doing, orwhat can we do now, what can we dowithin the short, mid term and longterm,” Warner said.According to Warner, the public realm

committee will review the report’s recom-mendation for 60 days and develop anaction plan. The plan will be presented tothe DLBA Board of Directors at a publicmeeting in December. �

Urban Land Institute Releases Final Report On Waterfront Revitalization

Jane Netherton Recognized By Marathon’s Run Racing

On September 30, the Long Beach International City Bank Marathon recognized Jane Netherton for her role in the race with a bench dedicated in hername in Rainbow Harbor. Netherton is the former president and CEO of International City Bank and is currently the bank’s chair emeritus. Fourteenyears ago, the bank began sponsoring the marathon under Netherton’s leadership. “I believed in what the marathon stood for, and I could see its poten-tial,” she recalled of her decision to sponsor the marathon. “It has benefited the city by the positive attention it brings. It brings people from all over,”she said. Bob Seagren, CEO of Run Racing, the organization that puts on the marathon, said Netherton played an integral role in growing the event,which grew in attendance from about 4,500 people to 22,000 since the bank’s first year sponsoring the event. “Jane has been our biggest champion.We are very thankful for her support over the years,” Seagren said. Netherton has attended the marathon every year since International City Bankbecame its sponsor. (Photograph by the Business Journal’s Thomas McConville)

kinds of projects and retail choicesLong Beach residents would like to seein their town. “We wanted to try to learn more about

where residents spend their money in anattempt to understand where the city’s lostrevenue is going,” said Business JournalPublisher George Economides. “We thought, instead of an expensive

city study – which is a typical public sec-tor approach – why not simply ask resi-dents to tell us what they want?,” he said.“And let’s not worry about being politi-cally correct. We’ve got plenty of low-cost, discount stores. We need higher endstores for those thousands and thousandsof residents who are spending theirmoney outside the city.”This story is part of a series of articles

the Business Journal is preparing in anattempt to find answers. For this issue, theBusiness Journal met with several

Women Discuss

Shopping Choices(Continued From Page 1)

(Please Continue To Top Of Next Page)

A rendering of the proposed pop-up park on Pine Avenue between Ocean Boulevard and Seaside Way.



Assistance League of Long Beach volun-teers: Annette Kashiwabara, Pam Karam,Linda Drummond, JoAnn McDonald andJane Jackson. These women range in agefrom their mid 40s to early 70s. TheBusiness Journal also spoke with JoenGarnica who is in her 30s. A resident ofDowntown Long Beach for 12 years,Garnica owns an interior design business,Garnica Interiors, located at 216 ThePromenade North.

Why start with women? Studies haveshown that more women shop in storeswhile most men shop online. But men, too,will be interviewed for this series.

The overwhelming message that camefrom speaking with the six women is that,while they might shop regularly in LongBeach for groceries, it’s a different storywhen it comes to shopping for clothes,gifts and home goods. The allure of shop-ping centers in Los Alamitos, as well asthe Los Cerritos Center and particularlySouth Coast Plaza in Costa Mesa, exert apowerful pull for women with discre-tionary incomes who like to shop.

“I am a shopper. It’s one of my favoritethings to do. Even if Ihave no intention of buy-ing, I enjoy just lookingaround,” said Drummond.

“If you are talkingabout clothes, there’sNordstrom in Cerritos orSouth Coast,” Drummondadded.

Jackson, who despitenot being much of a shop-per said she still prefersto head down the 405freeway when she doesdecide to shop.

“I usually go to SouthCoast. And if I want anice day, I will go to Fashion Island. I lovethe stores there. I will go to Cerritos forNordstrom,” Jackson said.

Kashiwabara said with her full-timework schedule she likes to shop whereit’s efficient, which means a lot of onlinepurchasing. But when she visits brickand mortar stores, she often finds herselfvisiting spots in Seal Beach or LosAlamitos. Her favorite clothing store isChico’s in Rossmoor. There used to be aChico’s location on 2nd Street inBelmont Shore, but it closed a couple ofyears ago, she noted.

“If it’s for a wedding gift or somethinglike that, I go to Macy’s. If it’s for reallynice dress-wear, then I will go toNordstrom at South Coast Plaza,” she said.

When asked about what makes spots likeSouth Coast Plaza so appealing, theanswers ranged from the variety of storesto the offering of high-end goods – some-thing Long Beach lacks.

“I think South Coast has all the high-endstores that kind of balance our bargainshopping [in Long Beach] at Marshall’sand Home Goods,” McDonald said.

Karam, who shops often with her 16-year-old and 11-year-old daughters, echoedthis sentiment, explaining spots like SouthCoast Plaza and Fashion Island in NewportBeach represent a one-stop option for allhigh-quality merchandise.

“You hit South Coast Plaza, or you hitnow what they call South Coast Plaza West.

They moved all of their home shoppingthere and now you can do everything in oneshot. Pottery Barn Teen is there now, WestElm, Williams Sonoma is opening upsoon,” Karam said, referring to the westernwing of South Coast Plaza, attached to themain mall by a pedestrian overpass bridge.

Describing the parking situation along2nd Street in Belmont Shore as difficult,Karam explained she will oftentimesbypass area stores she typically likes, suchas Gap and Banana Republic.

But parking issues aside, Long Beachmay have other drawbacks in terms of itslimited space. The women interviewed forthis article agreed that they wouldn’t wantto see their favorite stores scattered all overtown – a Nordstrom in Bixby Knolls and aWilliams Sonoma in Belmont Shore.

“You need the anchor department store,then you need to surround it with the Gaps,the J. Crews, throw in a Kate Spade, Coach,a Pottery Barn, Williams Sonoma and peo-ple will go,” Karam said.

Garnica, while echoing a lot of whatwas expressed by the other women, toldthe Business Journal she appreciates some

of the independent shopsin the East Village ArtsDistrict.

“I shop the East Villagefor clothing, but I do feelthere is a need and a placefor the national brands,”she said.

Garnica lamented therecent loss of NordstromRack, located on ThePromenade North, whichpicked up stakes and lefttown early this year.

“I used to like havingthe Rack there. The inde-pendents have a certain

look that I think is great, but there arealways random little things that those shopsmay not have. So having an option like theRack in the downtown was certainly help-ful,” Garnica said.

Garnica added that she’ll make the tripup the 605 to go to the Cerritos Mall forthings like clothing and dress shoes. Shefurther explained that Long Beach hasfewer options these days when it comes topurchasing home goods for her interiordesign clients.

“Unfortunately we’ve had a loss inretail,” Garnica said, adding that the now-closed Z Gallerie on Pine Avenue was a fre-quent destination. “Now I would say a lotof my home décor goods are purchased atSouth Coast Plaza. They have a ton ofhome goods stores.”

Garnica expressed frustration at the slowprogress of a retail center proposed at theintersection of 2nd Street and Pacific CoastHighway. Developer Taki-Sun Inc. hasplans to build a retail center, known as TheShoppes at 2nd and PCH, where the agingSeaPort Marina Hotel currently stands. Thedeveloper is waiting for the city to conductan environmental impact review before theproject can proceed – a bureaucraticprocess that can be frustrating to busi-nesses and consumers alike.

“Long Beach is one of the biggest citiesin California that doesn’t have a big pres-ence of these national department stores,”Garnica said. “It’s pretty sad.” �

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MemorialCare MedicalFoundation AcquiresImaging Centers InLong Beach AndOrange County

� By SAMANTHA MEHLINGER

Senior Writer

In early October, the MemorialCareMedical Foundation, the physician groupdivision of MemorialCare Health System,announced it had acquired eight freestandingimaging centers throughout Long Beach andOrange County to better service its growingpatient base spanning from Torrance to SanClemente. The health care system now ownsnine imaging centers in this area, three ofwhich are within the City of Long Beach.

“It benefits us by really enhancing ourcomponents of health care delivery so wecan reach a broader market and be moreattractive to our patients with high qualityand cost-effective options,” Dr. MarkSchafer, MemorialCare Medical FoundationCEO, said of acquiring the centers.

When the MemorialCare MedicalFoundation obtained the remaining 49 per-cent stake in the company Wave ImagingLLC in the first week of October, it becamethe sole owner of Wave’s imaging centersin Long Beach, Huntington Beach,Newport Beach, Irvine and Laguna Niguel.MemorialCare also recently acquired threeimaging centers owned by StrategicMedical in Long Beach, Newport Beachand Laguna Hills. “We are interested inStrategic Medical because they have such agreat reputation in the community for pro-viding high-quality imaging,” Schafer toldthe Business Journal. “That company fitsreally well into our portfolio of imaging,particularly in Long Beach,” he added.

“In Long Beach we now have three imag-ing locations that are part of MemorialCare.We have the Long Beach PET ImagingCenter, which does PET [positron emissiontomography] scans and CAT [computedaxial tomography] scans. Then we have oneof our original Wave sites, which is in theLong Beach traffic circle, which does MRI[magnetic resonance imaging],” Schafersaid. CAT, PET and MRI scans are used tohelp diagnose internal ailments.

In addition to these centers, Long BeachMemorial Medical Center and MillerChildren’s & Women’s Hospital LongBeach have outpatient radiology depart-ments with imaging services. “Betweenthose three locations we have got reallygreat quality sites with broad coverage ofthe Long Beach area and really high-qualityequipment,” Schafer said. “All three loca-tions have state-of-the-art equipment, andcover all the different imaging modalities.”

One of the reasons for investing in free-standing, community-based imaging cen-ters was to provide patients with moreaffordable imaging services, Schafer said.“Imaging can be costly, and doing it in afreestanding location tends to be muchmore cost effective,” he said, explainingthat imaging services in hospitals are oftenmore expensive because hospitals chargemore to cover overhead costs.

MemorialCare continues to invest in theLong Beach and Orange County areas dueto the opportunity for growth, Schafer said.“We continue to see more and morepatients move from other delivery systemsto the MemorialCare system, and we needto be able to accommodate the influx ofnew patients with physician offices, pri-mary care doctors, imaging centers andsurgery centers so our patients haveoptions,” he explained. “In order to do that,we need to expand our delivery system.” �

ect, including the Long Beach UnifiedSchool District and the South Coast AirQuality Management District, say the proj-ect will lead to an increase in truck trafficand pollution affecting neighborhoods andschools on Long Beach’s westside.

“What everyone is claiming is the city ofL.A. and the real parties in interest in BNSFdid not do an adequate job when they ana-lyzed the project that they were proposing interms of the California EnvironmentalQuality Act,” Mais said. “Specifically, theydid not do enough to mitigate the negativeenvironmental impacts that they had identi-fied would result from the project.”

In a complaint filed in Los AngelesSuperior Court in June 2013, the City ofLong Beach argued that by 2035 the proj-ect would result in 2 million truck trips atthe project site annually – as many as 7,000trips per day.

In August of 2013, the city consoli-dated its lawsuit with six other entities. InAugust of this year, the Business Journalreported Attorney General Kamala Harrisjoined the suit on the side of those oppos-ing the project.

But though the case continues to moveforward, statements made in September byLos Angeles Mayor Eric Garcetti to theLANG News Group editorial board sug-gest a resolution could be reached beforethe case goes to trial.

The Business Journal reached out toMayor Robert Garcia to get his opinion onGarcetti’s statements and whether he thoughta settlement was likely, but he declined tocomment directly on the pending litigation.In an e-mailed response, Garcia said that hismain interest was in protecting the area mostaffected by the proposed project.

“I am interested first and foremost in pro-tecting West Long Beach neighborhoods.This project as presented is not acceptableto the city,” Garcia’s statement read.

Mais meanwhile acknowledged that mostcases do get resolved before going to trail.

“The parties are working hard to see ifthere is some sort of common ground [so]that it can be resolved. Hopefully prior toeven the briefing, we will be able to medi-ate a potential settlement,” Mais said.

Though he said he couldn’t speak aboutspecific requests being made by the city aspart of settlement discussions, Maisexplained that Long Beach is looking forair quality and sound attenuation measuresfor residents who will be most impacted bypassing trains and trucks. He added that apotential buffer zone created by a partialdecommissioning of the Terminal IslandFreeway and the addition of an open spacearea between Westside neighborhoods andthe rail yard are also being considered. �

BNSF Lawsuit Update(Continued From Page 1)



Downtown TaskForce RevisesPermitting

Recommendations� By SAMANTHA MEHLINGER

Senior Writer

Following an October 6 meeting, theDowntown Dining & EntertainmentDistrict Task Force revised its recommen-dations for changing the entertainment per-mitting process for businesses within thedistrict. The revisions are scheduled forrelease this week (the week of October 13),according to Rachael Tanner, a programspecialist in the city manager’s office, anda public meeting is set for October 29.

In September of last year, the LongBeach City Council placed a moratoriumon the issuance of entertainment permits tobusinesses with Type 48 ABC liquorlicenses to allow a community task force toreevaluate the way entertainment permitsare issued in the district. Businesses withType 48 liquor licenses are bar and night-club-type establishments that do not servefood. Type 47 liquor licenses apply torestaurants.

The task force of community stakehold-ers, made up of residents and businessowners in Downtown Long Beach, releaseda set of recommendations in August andrevised those recommendations in earlyOctober following input from local com-munity and business groups. To give thetask force enough time to complete its rec-ommendations and conduct more commu-nity outreach, the city council recentlyextended the permitting moratorium foranother six months.

One of the major shifts in the revisedrecommendations is that, rather thanrequiring businesses with Type 47 ABCliquor licenses and Type 48 licenses toapply for both an entertainment permit anda conditional use permit (CUP), only busi-nesses with a Type 48 license engaging innightclub type entertainment would need toapply for both, Tanner explained.Entertainment permits are issued by thecity’s business licensing bureau, while theplanning department issues CUPs.

“We are still going to require nightclubsto get a CUP, which is [already] required bythe Downtown Plan. How we define night-clubs are establishments that have a fullbar, are not restaurants and who have enter-tainment. We’re looking at basically a Type48 ABC license, plus entertainment andoperating at night,” Tanner said. Therevised recommendation addresses con-cerns from community groups, such as theLong Beach Music Council, whichprotested the idea of restaurants having toapply for a CUP.

Tanner emphasized businesses with Type48 ABC licenses that only have entertain-ment a few times a year would be able toapply for a specific type of permit for lim-ited entertainment, rather than having to gothrough the CUP process. “It allows you tohave entertainment a certain number oftimes per year within days of each other,”she explained.

While the original recommendations sug-gested a reduced $5,000 CUP fee for night-club-type businesses in the district, afterconsulting with the city’s planning depart-ment, this suggestion was determined infea-sible, Tanner said. In most cases, the CUPprocess for nightclub establishmentsthroughout the city costs about $8,500. Tomaintain parity with the rest of the city,businesses within the Downtown Dining &Entertainment District are likely going tohave to pay the same amount, she explained.

Restaurants with Type 47 licenses pro-viding entertainment are only going to haveto apply for entertainment permits, as is thecurrent practice, but the task force is sug-gesting some changes to the permittingprocess. Under the revised recommenda-tions, all businesses applying for entertain-

ment permits within the district are goingto be required to complete a sound studyperformed by a licensed acoustical engi-neer to verify that their facilities do notexceed the mandated decibel levels whenentertainment is ongoing, according to adraft of the revised recommendations.

Under the recommendations, businessesthat already have the required permits andCUPs do not need to obtain new ones, butwould need to perform sound studies toensure they do not exceed the local noiseordinance, Tanner said.

In addition to these changes, the taskforce is recommending a 50-foot radiusrule for judging whether noise emanatingfrom an establishment is unreasonable. Ifnoise from an establishment is inaudiblefrom 50 feet on all sides of a building or is

relatively indistinguishable from ambientnoise, the establishment would be consid-ered in compliance with noise regulations,Tanner explained. Currently, if noise isinaudible from the middle of the street, anestablishment is considered in compliance.

The task force is holding a public meet-ing on October 29 at 6:30 p.m. at the SmallBusiness Development Center, 309 PineAve., to discuss its revised recommenda-tions. The recommendations are going tobe available through the city manager’sweb page at www.longbeach.gov/cityman-ager/. Once the document is posted, resi-dents have a chance to comment on it forabout a week prior to the meeting, Tannersaid. The task force hopes to have final rec-ommendations approved by the city coun-cil by the end of the year, she noted. �

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GOING GREEN12 Long Beach Business Journal October 14-27, 2014

small businesses reduce or negate the leg-islation’s impact on their operations.Assembly Bill 341, which went into

effect July 2012, began requiring busi-nesses (including public entities and multi-family units with five more dwellings) gen-erating four or more cubic yards of solidwaste – items such as glass bottles, alu-minum cans, cardboard and other recycla-

ble solid materials – to arrange for recy-cling services. AB 1826 broadens this man-date for these entities by including thosegenerating four or more cubic yards ofsolid waste as of January 2019, and twocubic yards of solid waste by January 2020.

Also, beginning April 2016, businessesand multi-family buildings generatingeight cubic yards or more of organic mate-rial per week must recycle that material.For multi-family dwellings, this excludesfood waste. By January 2017, the mandateincludes entities generating four cubicyards or more of organic waste. “Organics are what we think of as food

waste, yard waste and debris, tree trim-mings and those kinds of things,” JimKuhl, manager of the Long BeachEnvironmental Services Bureau, explained.“Pretty much what ends up in your trashcan is solid waste.”The good news for small businesses such

as coffee shops or small restaurants is theylikely do not generate enough waste to beimpacted by AB 1826 until 2019 or 2020,Kuhl noted. Implementing organic and solidwaste recycling now through city programsmight help these businesses reduce theirwaste production to the point that the billmight not impact them at all, he pointed out.One such program was developed through

the Long Beach Office of Sustainability in2011. “Our office launched a kitchen scrapcompost pilot pickup program in 2011 thatstarted with just one restaurant pickup andhas now grown to a handful of participatingrestaurants and coffee shops,” Tiffany Chen,sustainability analyst for the city, said.Those businesses include Steamed OrganicVegetarian Cuisine, Portfolio Coffeehouse,Berlin Bistro, Ahimsa Vegan Café and TheFlea Espresso Bar. “We pick up approximately 80 gallons by

Kerstin Kansteiner, owner of Berlin Bistro and Portfolio Coffeehouse, and Jim Kuhl, manager of Long Beach Environmental Services, load a bin in front of BerlinBistro with used coffee grounds. The grounds are free for anyone to use for composting in gardens. (Photograph by the Business Journal’s Thomas McConville)

Recycling(Continued From Page 1)


GOING GREENOctober 14-27, 2014 Long Beach Business Journal 13

volume once a week and drop off to an urbanfarm, the Growing Experience, in NorthLong Beach for soil amendment,” Chen said.

Small businesses are the ideal programparticipant, rather than large organic wasteproducers such as grocery stores, becausethey produce only a limited amount oforganic waste, Kuhl explained. “There arelimits on how much food waste you cantake to a facility before you need a specialpermit,” he said. “Once you exceed a cer-tain amount, that requires a solid wastefacilities permit, which is a very expensiveand difficult permit to get.” The city limitsthe amount of organic waste it picks upfrom businesses each week so the commu-nity gardens and farms where it deliversthe waste won’t have to apply for these per-mits, he added.

The type of food waste typicallyaccepted includes only raw fruits and veg-etables, eggshells and coffee grounds, Kuhlsaid. This is because the material is used toenrich soil, and other types of food wastecould be harmful to animals scavenging inthose areas.

Kerstin Kansteiner owns PortfolioCoffeehouse and Berlin Bistro, both ofwhich, as indicated earlier, participate inthe program and are located on 4th Street –Portfolio on Retro Row and Berlin in theEast Village Arts District. She is also headof the 4th Street Business Association.

“We have always been concerned aboutrecycling and how to be a better shepherdfor our environment. Coffee houses tend tohave a clientele that are very conscious

about this,” Kansteiner said. “We alwayshave to be at the forefront. So we havealways had our utensils being corn-based,and our to-go containers are compostable.We are always looking for the next step.”

When Chen attended a 4th Street BusinessAssociation meeting earlier this year, sheinformed Kansteiner about the city’s organicwaste pickup program for small businesses.Six months ago, Kansteiner enrolled herbusinesses in the program.

“We are now in a position where we canactually cut our trash pickups here,” shesaid. “What we also like to see is the fullcircle. The waste gets picked up here and isbrought to a farm. That farm is the verysame farm we do vegetable pickups from.So this is like food that comes back to us ina strange way,” she explained. “For staffand for customers, it is really exciting tohear it [the organic waste] is used withinLong Beach, that there is a change beingmade and that it helps all of us.”

The city, through its contractors, alsoprovides recycling to any business request-ing those services. Kansteiner said theservices are very useful at Berlin, whichconsumes “hundreds of gallons of milkevery week” in addition to coffee tins.

Kuhl said feedback from the other busi-nesses in the program has been positive.“There is probably more demand for [thecity’s organic waste pickup program] thanwe have the ability to service because weare limited on how much food waste we cantake,” he said. The city is hoping to identifymore locations to donate the organic waste

to as AB 1826 is implemented to accommo-date increased demand for the program. Theissue is that under the new bill, “we believe30,000 to 40,000 tons of waste a year willbe generated,” Kuhl said. “We think weneed 40 to 50 acres to compost that muchmaterial. That is just not available.”

Still, Kuhl encouraged businesses toparticipate in the program and ask forrecycling containers for their solid waste.By diverting that waste from their trashbins, they may be able to avoid generat-ing enough trash to have to comply withAB 1826. �

Kerstin Kansteiner, owner of Berlin Bistro and Portfolio Coffeehouse, and Katie Whitesell, chef at Berlin,deposit organic waste from the bistro’s kitchen into a container for recycling. Berlin Bistro and Portfolioparticipate in a program through the City of Long Beach’s Office of Sustainability in which the organicwaste is picked up by the city and used in local urban gardens and farms as compost material.(Photograph by the Business Journal’s Thomas McConville)


GOING GREEN14 Long Beach Business Journal October 14-27, 2014

ments, according to Long BeachSustainability Coordinator Larry Rich andSustainable City Commission Chair DarylSupernaw.

This year, some larger projects the com-mission and staff hope to tackle includedeveloping infrastructure for environmen-tally friendly automobile use, continuing topromote waste reduction through city pro-grams, and restoring and developing naturalresources in the new Willow Springs Park.

“If you look at this plan, it has the mostbreadth of any commission,” Supernawtold the Business Journal. “It is so broadthat it is great to have staff who can providein-depth knowledge,” he added.

Green TransportationWhile the city already has some charging

infrastructure for electric vehicles in placein public parking lots, Rich said the officeof sustainability and the Sustainable CityCommission hope to identify ways to fur-ther develop and foster that infrastructure.

“The city had a round of electric vehiclecharging station installations based on anRFP [request for proposals] we put out acouple of years ago, but it was specificallyfor city-owned parking lots and structures,”Rich said. Examples of city parking lotswith these charging stations include those atthe Long Beach Airport, the parking garageadjacent to city hall and garages near CityPlace Shopping Center, the Aquarium of thePacific and the Queen Mary.

These stations were installed at no cost tothe city. “Our goal and model going in wassaying, ‘Okay, charging station company,we’ll give you these spots but you need tobuild the infrastructure, create the utilityconnection, pay the bill to it and all of thatat no cost to the city,’” Rich explained. “Wewere able to find a company that was will-ing to do that,” he said, adding the companywas able to install the stations for free bycharging users of the spaces.

Rich said his office and the commissionnow hope to implement more charging sta-tions throughout the city. In order to do sowithout cost, they are investigating waysthe city might work with developers orproperty owners to install the stations.“The city would take a look at a program toencourage or streamline the charging sta-tion installations to get more of that infra-structure out there, which then makes peo-ple more comfortable to purchase electricvehicles,” he said.

Another green transportation programRich and Supernaw said they hope to imple-ment is car sharing. “In addition to the elec-tric vehicle charging stations, we’re continu-ing to work on making our city’s rules con-ducive to a car-sharing company being ableto come in,” Rich said. Companies likeZipcar position a fleet of vehicles in strate-gic locations in cities and universities wherepeople may rent a car for limited timeframes, such as to shop for groceries or goto work. The concept is particularly gearedtoward individuals without vehicles.Implementing car-sharing programs is oneway to encourage residents to live car-free.

The city has been investigating a newermodel of this idea called free-floating carsharing, in which a company’s vehicles maybe left anywhere rather than in a designatedlot. Free-floating car-sharing companies andtheir customers are able to track the positionof the cars using a phone application. “Itallows you to pick it up near to where you areat that moment and then drop it off and leaveit wherever it is you need it to go,” Rich said.For the city to be comfortable implementingsuch a program, the state would first have toadopt changes to its vehicle code to ensurethe practice is regulated, he added.

“This also illustrates the unique chal-lenges of a city versus a single entity likeCal State Long Beach,” Supernaw noted.The university has Zipcars available forstudent use, he explained, but implement-ing a citywide car-sharing program wouldbe more complex.

Promoting Waste ReductionNow in its third year running, the city’s

home delivery mulch program continues tobe in high demand among residents, andthe Sustainable City Commission has listedthe program as a priority for continuationin this year’s work plan.

The program grew out of an originalconcept from the commission and office ofsustainability to reuse the city’s tree trim-mings as mulch on vacant city lots to sup-press weeds, Rich explained. “The city’svacant lots, like all those redevelopment[agency] lots, are typically covered withmulch, which helps reduce the city’s prop-erty maintenance cost because it sup-presses weed growth,” he said.

The city then began offering residentsaccess to the tree trimmings for mulch ontheir properties. “We have a pickup truck

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A Sustainable City(Continued From Page 1)


GOING GREENOctober 14-27, 2014 Long Beach Business Journal 15

which we hand load with pitchforks andthen take the mulch to someone’s home andunload it into their driveway,” Rich said.“We have delivered over 2,300 loads ofmulch to residents. We do this two days aweek on Tuesdays and Thursdays, withabout eight deliveries per day.” The pro-gram is so popular that there is a nine-weekwaiting list for deliveries, he noted.

Supernaw pointed out residents whoneed mulch sooner than nine weeks areable to visit a self-service yard at 2702California Ave., where they may pick upmulch themselves.

Without this program, the city’s treetrimmings would go to a green waste recy-cling facility but, because those facilitiesare overloaded, much of the waste wouldhave eventually gone to a landfill, Richexplained. “We were able to find a localbeneficial use and avoided that truck trip tothe green waste facility, and then subse-quently to the landfill,” he said.

Willow Springs ParkWhen Wilmore City, eventually renamed

Long Beach, was founded in 1882, thecity’s first fresh water source was locatedbetween Spring and Willow Streets in whatwas called the Artesian Springs accordingto Rich. The area, once home to wetlandsand a dense population of willow trees, lostmuch of its natural resources after the oilboom in the 1920s. Now, one of the city’ssustainable projects is to rehabilitate thewetlands and willows of the area, creatinga park named for the land’s history –Willow Springs Park.

“The streets Spring and Willow got their

names in acknowledgement of this streamthat was lined with willow trees. We tookthat as inspiration for a restoration projectto bring back water and willow trees onthat site to make it a visitor destination,”Rich said. The idea is to restore the landand develop a wildlife habitat similar to ElDorado Nature Center, he added.

To restore the wetlands and encourage wil-low trees to grow, the city needs a watersource. Luckily, a major storm drain runsbeneath the 42-acre park zone, Rich said.“We are going to create wetlands that mainlywill be seasonal wetlands by allowing thewater to come out of the pipe and flood thelow-lying areas, saturating the soils to createwetlands the way it was historically.”

Thanks to a $1 million allocation of one-

time revenues from the City of LongBeach, a $924,000 grant from the state’sstrategic growth council, a $50,000 grantfrom the Southern California Associationof Governments and a $15,000 grant fromthe Long Beach Naval Memorial HeritageTrust Fund, about $2 million has beenamassed for the park. “The initial $2 mil-lion is going to be directed at 12 of the 48acres to restore about a quarter of the land.But then the remaining 36 acres still needadditional funding down the line, which wewill continue to pursue,” Rich said.

The fact that 42 acres of land in LongBeach has remained undeveloped for morethan a century, with the exception of a fewoil wells, “is pretty phenomenal,”Supernaw noted.

In addition to environmental restora-tion, the site is also a sustainable projectbecause of a building to be adaptivelyreused there, Rich pointed out. Built in1907 and originally located in DowntownLong Beach, a train station has sat in thecity’s public service yard since 1936,when it was moved from downtown. Thebuilding served for some time as a mate-rials testing laboratory, but Rich is work-ing to restore the building and have itmoved to Willow Springs Park to be usedas a community resource. “This is wherethe conceptual idea that sustainabilityand historic preservation are natural part-ners. This is a tangible project we aredoing that is historic preservation andadaptive reuse.” �

Daryl Supernaw, left, chairof the Sustainable CityCommission, and Larry Rich,sustainability coordinator forthe City of Long Beach, visita historic train station at acity storage yard off of SanFrancisco Avenue. The trainstation was built in 1907 inDowntown Long Beach andwas moved to the storageyard in 1936. Supernawand Rich hope to relocate

the building tothe new WillowSprings Park (atleft) and restoreit for communityuse. (Photographby the BusinessJournal’s ThomasMcConville)


MOBILITY16 Long Beach Business Journal October 14-27, 2014


Senior Wrtier

In October 2013, the City of LongBeach adopted a new Mobility Element,a section of the General Plan devoted tothe movement of people, goods and vehi-cles throughout the city. The documentrepresented a shift in thinking from pre-vious versions: while prior city planningdocuments placed priority on automobiletraff ic, the new Mobility Elementfocused on balancing the needs of pedes-trians, bicyclists and vehicles throughLong Beach.

The city is now building upon these prin-ciples through two new planning docu-ments meant to improve pedestrian mobil-ity, access, connectivity and safety along

the city’s transit corridor and in Central andWest Long Beach.

With a $183,500 grant from the LosAngeles Metropolitan Authority (Metro),Long Beach Development Services(LBDS) recently began working on a com-panion document to the Mobility Elementfocused on improving pedestrian accessalong the length of the Metro Blue Linesouth of the 405 Freeway. LBDS staff isfocusing on a radius of about four blocksalong the whole length of the Blue Line tocreate better pedestrian access to the Metro(refer to map below).

The grant also allows the city to focus onthe greater Downtown Long Beach area,spanning west to east from the Los AngelesRiver to the edge of the Alamitos Beachneighborhood, and north to south from

10th Street to the ocean. The Metro anddowntown-centric areas to be addressed inthe plan were previously identified in theMobility Element as priority zones forimplementing pedestrian-friendly projects.

While the Mobility Element identifiedmany places in the city as pedestrian pri-ority areas, LBDS’s Ira Brown explainedthe city is first focusing on downtown andthe area around the Metro Blue Line sim-ply because the funding was available todo so – the grant from Metro only appliesto those areas.

“We are at the very beginning of anaccelerated timeline,” Brown said, refer-ring to his department’s process in prepar-ing the document, dubbed the Downtownand Transit-Oriented Pedestrian MasterPlan. During the past few months, LBDS

staff members have met with communityconstituents to get input on pedestrianneeds within the grant area. “We havealready conducted about eight stake-holder interviews,” Brown said. “Beforewe went to the public we wanted to haveour consultants and staff dive into thedetails with residents so we have a betterpicture about where we are headed,” heexplained.

Brown continued, “We interviewedolder adults, trying to understand whattheir issues were. We chatted with someof our stakeholders in the downtownshoreline and found out what their partic-ular needs are. We have chatted withsome of the advocates for pedestrian cir-culation, [such as] people organizingwalking events. We are going to continuedoing small group discussions throughoutthis process.”

In mid-September LBDS held a publicevent called WalkForth, in which tempo-rary pop-up installations were imple-mented along 4th Street between the BlueLine at Long Beach Boulevard andAlamitos Avenue to give the communityan idea of some of the concepts that maybe included in the Pedestrian Master Plan.Installations included mid-block cross-ings, curb extensions, way-finding signsand landscaping. The event was also anopportunity for residents to provide feed-back to the city.

“WalkForth was our first workshopwhere we tried to get input from everydaypeople – people walking on the street,”Brown said. “With the information weheard at the WalkForth event and fromour focus groups, we are going to beworking on some preliminary conceptsabout how we can improve the pedestrianenvironment and pedestrian circulationaround our Metro stations and in ourdowntown,” he explained. “We will thenfine-tune the list of projects we want toimplement through this plan.”

Because the city is still in somewhat ofan information-gathering phase with thedevelopment of this document, it mightbe too soon to guess what projects thedocument will suggest for improvingpedestrian mobility, access and connec-tivity. But Brown said elements like thosedemonstrated at the WalkForth event –clearly defined way-finding signage, curbextensions and mid-block pedestriancrossings – might be included.

LBDS should have a final documentready for approval by the Long BeachPlanning Commission in May or June,Brown estimated. The document wouldthen go to the city council for approval.

As LBDS works on the Downtown andTransit-Oriented Pedestrian Master Plan,another pedestrian-related document isunderway through a grant from the U.S.Department of Agriculture (USDA) to theLong Beach Department of Health andHuman Services, with local non-profitCity Fabrick as a sub-grantee. CityFabrick is an “urban design studio dedi-cated to improving the physical environ-ment of Long Beach through design,planning, policy and engagement,”according to the organization’s website.

Pedestrian Planning Efforts Underway For Parts Of Long Beach

Section 1 of this map encompasses the area for which Long Beach Development Services is developing the Downtown and Transit-Oriented PedestrianMaster Plan, a planning document aimed at improving pedestrian access and connectivity to Metro Blue Line stations and within Downtown Long Beach.The remaining numbered sections of the map are areas where the city’s health department and the local nonprofit group City Fabrick are examining waysto improve pedestrian safety and access. (Photograph provided by City Fabrick)


MOBILITYOctober 14-27, 2014 Long Beach Business Journal 17

About three months ago, the healthdepartment and City Fabrick began con-ducting research and community outreachto determine ways to improve pedestriansafety in Central and West Long Beach,according to City Fabrick ExecutiveDirector Brian Ulaszewski. “What we aretrying to do is build upon what they[LBDS] are doing and expand their area.It is certainly going to be a different prod-uct and a bit of a different process, but thegoals are similar in trying to identifypotential projects and policies to improvepedestrian safety and access,” Ulaszewskisaid. “The intention is to coordinate theeffort,” he added.

Similar to the grant provided to LBDS,the grant awarded to City Fabrick and thecity’s health department requires a focus onparticular areas of Long Beach – in thiscase, parts of West Long Beach closest tothe port as well as areas within CentralLong Beach (refer to map).

“That has a lot to do with access tohealthy foods and walkability and othersort of health indicators and healthy com-munity initiatives,” Ulaszewski said of thefocus areas. West Long Beach, for exam-ple, is located between the 710 Freewayand the Los Angeles River and is isolatedfrom the rest of Long Beach. The area alsohas limited access to basic needs such asgroceries. “There is a lot of interest in bet-ter connecting residents in West LongBeach to those in Central Long Beachbecause, between the L.A. River and the710, it is pretty disconnected.”

City Fabrick has developed a project areamap identifying areas for pedestrian infra-structure improvements in relation toschool campuses. “We are looking at saferoutes to schools,” Ulaszewski said. “Weactually did a walking workshop with stu-dents both from Hudson [Elementary] aswell as Cabrillo High School. They toldstories about walking Pacific CoastHighway over the 710 [freeway] and L.A.River. You look at what they have to walkalong and it is pretty awful, and they do itevery day,” he said. “One side doesn’t havea sidewalk and the sidewalk on the otherside is like four feet wide and it has a lot oftraffic. So what can we do to make that bet-ter and safer?” This is the sort of questionhe and his colleagues are examining.

“We are still in the beginning of theprocess, doing a lot of existing conditionanalysis both looking at accident reportsover the past decade, traffic data, but alsogoing out in the community and asking res-idents and stakeholders, ‘where do you seethe issues,’” Ulaszewski said. “It is reallyvaluable because they are the experts ontheir neighborhood and they are going tobe able to tell us where the issues are.”

Once City Fabrick and the healthdepartment have gathered information toidentify priority areas for pedestriansafety improvements, they are going todevelop a planning document similar tothe one LBDS is working on. “The inten-tion is for it to be a policy document,”Ulaszewski said. “We are tying this veryclosely to the Mobility Element and bas-

ing it on a lot of existing policies.”Proposed projects in the document mayfocus on improving lighting in areas thatare particularly dark at night, or addinginfrastructure to consider people withlimited mobility. He said the goal is tofinish the document within one year.

“We hope this is a fruitful example ofdifferent ways to collaborate betweencommunity partners and city government.The health and human services depart-ment has been a good partner in develop-ing and starting to look at policiesthrough the lens of healthy communitiesand creating healthier communities,”Ulaszewski said. “It is hopefully just the

beginning of more active engagement onpolicy through that lens.”

Improving pedestrian mobility, accessand safety has multiple benefits, Brownpointed out. “There is certainly an eco-nomic development component of walk-ing,” Brown said. “If you have a walkingcommunity, your community is morelikely to shop local than get in a car anddrive to another city. So it [pedestrianplanning] represents community revital-ization,” he explained. When people areencouraged to walk or take public transitto their destinations, automobile trafficdecreases, which also has positive envi-ronmental implications, he added. �


THE TECH SECTOR18 Long Beach Business Journal October 14-27, 2014

Analysis Group, Los Angeles CountyEconomic Development Corp., said theresults of the analysis were important inbringing attention to the often-hiddennature of the tech sector in the land ofbeaches and palm trees.

While other metro regions have deliber-ately invested in – and market – an eco-nomic ecosystem designed to attract andretain tech businesses and employment, thenature of Los Angeles’ economy hasallowed a tech sector to evolve into thelargest in the nation.

“The L.A. tech sector is really broadand diverse, across a range of industriesthat we have here, including those thathave been here for decades, like aero-space, and new ones, like software pub-lishing and computer products, onlineactivity, that kind of thing,” Cooper says.“It’s quite large. That was a significantfinding. People think there are tech sec-tors in other regions but we happen tohave a very large one here, accounting formore than 368,000 jobs.”

A recent report from UCLA’s AndersonForecast concluded that, as the nation’sunemployment rate fell, California’srecovery in terms of employment wouldlag behind. But the Institute for AppliedEconomics analysis suggested that it’snot just the number of jobs, but thewages paid to those employees, that

determine economic health. And techjobs pay well – really well.

“The wage premium that’s paid in thetech sector – it’s pretty important to realizethat jobs in the tech sector on average earn70 percent more that jobs on average inother industries. It is quite a gap. And that’swhat this data is bearing out,” Cooper says.

Los Angeles County, in all honesty, kindof lucked out on the high tech front.

The industries that established them-selves here and that occupied the economiclandscape for decades helped create thebasis for the high tech sector of today,Cooper says.

“First of all, there’s the legacy. The aero-space industry, the entertainment industry,these are industries that themselves gener-ate high tech innovations and inventionsand spin new industries out,” Cooper says.“The combination of a high tech manufac-turing base and the creativity side – this isalso really creating new types of thinkingabout delivery of products. It’s a cross-industry type of relationship.”

And the traditional reasons that peoplewant to live in Los Angeles County,combined with the global dispersion ofdifferent facets of the manufacturingprocess, mean that the intellectual seg-ment of the high tech sector is attractedto Southern California. While lower-paying jobs requiring less education maymove elsewhere, Southern Californiastill attracts the people who create the

businesses, products and production sys-tems that generate those other jobs.

“Another factor is, really, quality of life.People like to be here,” Cooper says. “Wekind of joke about it, but if people like tobe somewhere, they’ll stay somewhere. Ifyou have a choice about where you want tolive, and you can afford to live whereveryou want around the world, this is still anattractive place to be.

“You have to remember these are indus-tries that don’t have to be located here.You can have your designer or your engi-neer working halfway around the worldsending their files digitally. That’s one ofthe keys to having innovative, new-think-ing people here. We shouldn’t minimizethe quality of life issues.”

Other significant findings of the report:• The high tech industry in Los Angeles

County employed 368,580 workers in2013.

• The largest high tech segments are:aerospace products; wholesale activitiesrelated to high tech products; engineeringservices/research and development; con-sulting services; and computer software,design, services and online publishing.

• In the past 10 years, the high tech sec-tor changed from production-based indus-tries to service-oriented ones.Employment in high tech services grew by13.5 percent and high tech manufacturingemployment fell more than 17 percent.

• The annual average wage paid to all

employees in the high tech sector was$86,934, almost 68 percent higher thanthe average paid to workers in non-hightech industries, which was $51,778.

• The high tech sector paid almost 17percent of all wages in the county – $32billion – in 2013.

• An additional 187,570 jobs are sup-ported by high tech industries throughtheir purchase of goods and services fromlocal businesses that are not within thehigh tech ecosystem.

• Another 207,480 jobs are supportedby the high tech ecosystem through thehousehold spending of employees in hightech industries and their supply chain.

• Overall activity produced $108.3 bil-lion in value-added, which is the sector’scontribution to regional GDP.

Definitions:For this study, definitions of “high tech

industry” and “high tech occupation” aredrawn from work done by Daniel E.Hecker with the Office of OccupationalStatistics and Employment Projections atthe U.S. Bureau of Labor Statistics. Forthis study, a high tech industry is one inwhich technology-oriented occupationsaccount for a larger proportion of theindustry’s overall employment than theaverage for all industries, and a high techoccupation is one in which a worker needs“in-depth knowledge of the theories andprinciples of science, engineering andmathematics underlying technology.” �

New AppSchwag,Developed By Two LocalEntrepreneurs, Aims To DriveCustomers To Your SiteDavid Black (right), co-devel-oper of the Schwag smart-phone application, visits oneof the application’s vendorusers, Legends Sports Barco-owner Eric Johnson.Locals Jim Grubbs andWilliam Ahmanson devel-oped the application withBlack. According to Grubbs,the phone application wascreated with local merchantsin mind. “We want to bene-fit local small businesses,”Grubbs said. Although theuser and geographicalreach of the applicationhave not yet warrantedcharging the businessesusing it, Grubbs said theconcept is to eventually havemerchants pay to send adsthrough the application for alimited period of time.Pricing would vary, depend-ing on the time period abusiness owner chooses torun the ad and the geographical radius he or she wants it to apply to. “An example of pricing is an eight-hour ad sent within a one-mile radiusfor $5. Then, at three miles it is $7. At five miles it is $11. It is very inexpensive,” Grubbs said. “If Legends is slow on Tuesday at 11 a.m. andthey want to bring in people for lunch, they can put an ad out saying ‘It is Taco Tuesday, so come on in,’” he explained. Users of the applicationreceive notifications on their phone about deals in their area and are able to set the frequency of notifications, he said. Schwag does notrequire any information from users; unlike with most smartphone applications, no e-mail address or credit card information is required. Theapplication is free to download through the Apple Store and Google Play. “We have 40 businesses that have signed up and downloaded theapp,” Grubbs said, noting most of the businesses are on 2nd Street in Belmont Shore or in Seal Beach. California State University Long Beach’sathletics department and the university’s commercial division also use the application to send out ads. Grubbs said he, Black and Ahmansonhope to have 10,000 users of the locally based application by the end of the year. For more information about Schwag, visithttp://www.schwagapp.com/. (Photograph by the Business Journal’s Thomas McConville)

Hi-Tech Jobs Lead Nation(Continued From Page 1)


in general obligation bonds to fund water-related programs. The proposition wouldalso redirect $425 million in unsold generalobligation bonds for water-related uses.

Speaking to the Business Journal, KevinWattier, general manager of the LongBeach Water Department, expressed hissupport for the proposition, saying it wouldprovide $725 million specifically for waterrecycling. Wattier explained that, for sev-eral years, government funding for waterrecycling has been tied to an integratedwater management program, which he saidwas inefficient.

“We’re very pleased that recycling isbeing pulled back out as a stand-alone pro-gram. We think it’ll be more efficient to getmoney for recycling that way,” Wattier said.

The proposition would also providemoney for conservation efforts.

“There’s some money in there for conser-vation, which is our number one priority.Not just for us, but for all of California,”Wattier said.

Proposition 1 also provides $1.5 billionto fund projects aimed at restoring and pro-tecting watersheds and other habitatsstatewide. Money would be used to pur-chase land for conservation purposes aswell as to reduce the risk of wildfire and tosupport wildlife. Another large chunk ofthe funding, $2.7 billion, is slated for newwater storage projects such as dams andprojects to replenish groundwater.However, this money could only be used topay for costs related to “public benefits,”such as restoring habitats, flood reduction,improved water quality and recreation.Government agencies, such as those that

actually sell the water from the storageproject to customers, would be responsiblefor paying the remaining costs. The legisla-tive analysts office projects that interestrates for the bonds sold would average a lit-tle more than 5 percent and would be paidover a 30-year period. This would result incosts to the taxpayers of an estimated $360million annually for 40 years.

Opposition to the proposition comesfrom State Assemblymember WesleyChesbro, who chairs the Committee onNatural Resources, as well as ConnerEverts, executive director of the SouthernCalifornia Watershed Alliance. Bothsigned the argument against the proposi-tion in the state’s official voting guide,which says that dams are a high-costresponse to the state’s water problems andprovide little benefit.

“All the most productive and cost-effec-tive dam sites in California have alreadybeen developed. Proposition 1’s new damprojects increase California’s total watersupply by as little as 1 percent, while cost-ing $9 billion to build,” the argument read.

The rebuttal, signed by Governor Brown,maintains that Proposition 1 is a fiscallyprudent response to the state’s currentwater crisis. Proposition 2 Seeks To StrengthenThe State’s Rainy Day Reserve

By some estimates, California facesmore than $300 billion in unfunded liabili-ties: police, fire and teachers’ pensions aswell as retiree health care costs.Proposition 2 requires the state to annuallytransfer 1.5 percent of its general fundmoney to the Budget Stabilization Account(BSA) and spend a minimum amount eachyear to pay down the state’s massive debt.

In years when revenues from capitalgains taxes are higher than average, someof those revenues will be required to paydown debt as well. According to the leg-islative analyst’s office (LAO), ifProposition 2 is passed, annual paymentstoward the state’s debt obligations wouldrange from $800 million in lean years to $2billion or more in years with higher capitalgains revenue. A cap of 10 percent of thegeneral fund will be set for the BSA, andany remainder will be put toward infra-structure projects throughout the state.

Though the state has had a BSA since2004, under current rules, the governor canchoose to put no money in the fund – thestate has suspended transfer of funds to theBSA every year since 2007. Under the newrules, the governor could put in less than theminimum required only after declaring abudget emergency and getting the support ofthe legislature. The proposition also estab-lishes a state reserve fund for K-12 schools.Money would be put toward the state’sschool fund in years when revenues fromcapital gains taxes are higher than average.

Supporters of the proposition includeGovernor Brown and CalChamber. In astatement, the Chamber argued the propo-sition could guard against future taxincreases.

“Proposition 2 forces the state to savemoney and requires politicians to livewithin their means and protects againstunnecessary tax increases. In good times,money will be placed in a constitutionallyprotected reserve and used to pay downdebt,” the statement read.

Opposing the proposition is the groupEducate our State, a parent-led organiza-tion that advocates for high-quality educa-

tion. The group takes particular exceptionto a portion of the proposition that reducesthe maximum amount of money schoolscan keep in reserve. Depending on the sizeof the school, this amount allowed underthe proposition could range from three to10 percent of its annual budget.

“For districts across California, localreserves have been all that’s protected chil-dren from state-inflicted borrowing costsor program cuts,” the argument againstProposition 2 read.

The minimum amount that schools arerequired to keep in reserve under existinglaw would remain unchanged.

Speaking directly to the BusinessJournal, Educate Our State DirectorKatherine Welch said Governor Brownshould re-work the proposition and reintro-duce it next year.

“He can come back to the voters in 2016with a rainy day fund that doesn’t makekids pay for it. We have the largest classrooms in the nation, we have the lowestfunded schools and our kids aren’t gettingwhat they need,” Welch said.

The Business Journal reached out to LongBeach Unified School District for its take onthe proposition. In an e-mailed response,LBUSD spokesperson Chris Eftychiou saidthe district hasn’t taken a formal stance onthe proposition but added that the dialoguecreated by the proposition is good.According to the statement, Long BeachUnified supports reliable stable funding forschools, though it didn’t mention whetherthis proposition went far enough to providethat funding. The statement also referred tothe recent passage of Proposition 30, whichraised taxes in 2012 to pay for schools.

20 Long Beach Business Journal October 14-27, 2014

BALLOT PROPOSITIONS

Renovation Begins On Future Home Of Long Beach City College Nursing DepartmentOn October 2, the leadership of Long Beach City College (LBCC) was joined by students from the college’s nursing program at a ceremony to celebrate the start of renovations on Building C at the LiberalArts campus, the future home of the nursing department. The 45-year-old building is being converted into a hospital training facility with medical simulation equipment and laboratories, computers andaudiovisual equipment, new faculty offices and conference rooms, and new landscaping and signage. The architect is BCA Architects, with Construct One as the general contractor. The Cordoba Corporationis overseeing the project. The budget for the 23,000-square-foot facility’s renovation is $11.65 million. The renovations are funded by Measure E, a $176 million bond issue passed in 2002, and a second

Measure E bond totaling $440 million,which passed in 2008. “The renovationof Building C shows that LBCC is com-mitted to providing the best communitycollege education in the state,” LBCCSuperintendent-President Eloy OrtizOakley said in a statement. “We areaware that, in order for our students tobe successful in their careers, we needto keep up with today’s technology inthe medical field,” he stated. JeffreyKellogg, president of the Long BeachCommunity College District Board ofTrustees, added in a statement, “TheBuilding C upgrade will allow LongBeach City College to meet the needs ofour students as the demands of oureconomy and society change, as wellas provide our faculty members modernspace for teaching.” Pictured from left atthe ceremony are: Dr. Thomas Clark,former LBCC trustee; Dr. Virginia Baxter,Area 5 trustee; Kellogg, who representsArea 1; Sunny Zia, Area 3 trustee;Oakley; Doug Otto, vice president ofthe board of trustees representing Area4; and Ann-Marie Gabel, LBCC vicepresident of administrative services.Pictured above are nursing students.(Photograph by the Business Journal’sThomas McConville)

November 4 Election(Continued From Page 1)

(Please Continue To Top Of Next Page)


“We recognize however, that Prop. 30funding is not a permanent fix, so it’simportant to consider ways of creating astable source of education funding over thelong haul,” the statement read.

Supporters argue that Proposition 2protects schools by stabilizingCalifornia’s budget.Proposition 45 And The RejectionOf Unfair Insurance Premiums

If passed, Proposition 45 authorizes thehead of the California Department ofInsurance (CDI) to approve or reject insur-ance rates proposed by individual and smallgroup health insurance providers. Opponentsof the proposition argue it gives too muchpower to one individual – the state’s insur-ance commissioner. Others argue that, with-out this proposition, small businesses, indi-viduals and families are at the mercy of med-ical corporations when it comes to buyingaffordable health insurance.

Under current law, the CDI is one of twostate agencies responsible for reviewing therates and products offered by health insur-ance companies and HMOs. Though theCDI can judge an insurance company’spricing to be unfair, the department doesn’thave the authority to reject rates.

Opponents of the proposition includethe Kaiser Foundation Health Plan,Wellpoint Inc. and Blue Shield ofCalifornia. The three healthcare compa-nies are part of a political action commit-tee that, according to records available onthe Cal Access website, has raised morethan $35 million to oppose the proposi-tion. CalChamber has also taken a posi-tion against Proposition 45, suggesting itcould lead to a degradation of care.

“Some have argued [Prop 45] couldundermine efforts by California’s healthexchange, Covered California, to makesure health coverage offered to individualsand small businesses is a good value, notjust inexpensive,” the Chamber argued.

Since the passage of the Affordable CareAct, insurance companies have beenunable to charge higher rates based on aperson having a preexisting condition.Insurers can however charge higher ratesbased on the zip code a person lives in – apractice known as geographic rating.

According to Janice Rocco, deputy com-missioner for the CDI, the state is brokenup into 19 different regions where differenthealth care premium prices can be charged.She said the rationale for allowing thispractice is that health care costs differ fromregion to region across the state. Insurersare allowed to set varying premiums in spe-cific regions based on claims experience inprior years – a practice many consumersliving in costlier regions would argue isunfair. But Rocco explained that, even ifinsurance agencies are unfairly chargingfrom region to region, there is no stateagency that can currently stop the practice.

“If the claims experience doesn’t jus-tify the premium increase the insurer isproposing, no one has the authority toreject excessive rate increases inCalifornia,” Rocco said.

This could potentially change ifProposition 45 is passed.

Speaking to the Business Journal, StateInsurance Commissioner Dave Jonesexpressed his support for the proposition.

“Proposition 45 gives the insurance

commissioner the authority to regulatehealth insurance and HMO rates. And thatwould include looking at geographic rat-ing,” Jones said.

Further explaining that 35 other statescurrently authorize their insurance commis-sioners to reject excessive rates, Jones addedthat Prop 45 is good for small businesses.

“Without it, health insurers and HMOswill be able to continue to inflict double-digit rate increases on small businesses,”he said. “Small businesses are among themost vulnerable of those in the [health]market because they have absolutely nobargaining power.”

As further evidence of that, theBusiness Journal has been notified thatits group medical plan – paid in full foremployees by the company throughAnthem Blue Cross – is increasing 29.3percent on December 1.

“For a small business such as ours, that isa heavy hit,” Publisher George Economidessaid. “We’re examining alternatives.”Proposition 46 Focuses Attention

On Doctors, PrescribersIn addition to requiring random drug

testing of doctors, Proposition 46 requiresdoctors to register and refer to a databaseknown as the Controlled SubstanceUtilization Review and Evaluation System(CURES), before prescribing certaindrugs. The bill is sponsored by Bob Pack,whose two children were killed in 2003near their Bay Area home by a driver whohad been abusing prescription drugs.CURES tracks the prescription history ofpatients in an attempt to curb “doctor shop-ping” and stem the abuse of drugs such asVicodin, OxyContin and Aderrall. Thoughdoctors are already required to registerwith the system by 2016, they are not cur-rently required to check the system prior toprescribing drugs.

Proposition 46 also raises the cap onnon-economic damages in medical mal-practice cases – a cap that was set at$250,000 in 1975. Under the proposition,the cap is raised to $1.1 million and allowsannual adjustments for inflation.

The proposition is supported by TheConsumer Watchdog campaign, a coalitionof consumer advocates, attorneys andnurses as well as Yes on Proposition 46, acoalition of consumer attorneys andpatients. The Cal Access database showsthe groups have raised more than $5.7 mil-lion supporting the proposition sinceJanuary. Supporting arguments state that,in addition to saving lives by reducing pre-scription drug abuse and exposingimpaired doctors, victims of malpracticecan receive compensation in line with therise in inflation.

Meanwhile, according to the Cal Accessdatabase, the committee opposing themeasure, which is comprised of patients,providers and health care insurers, raisedmore than $56 million between Januaryand September 30 of this year.

CalChamber also opposes Proposition46, arguing on its website that Californiacurrently benefits from some of the lowestmalpractice costs in the country. It main-tains the proposition would quadruple mal-practice settlements against doctors,“which will cost consumers and taxpayershundreds of millions of dollars every yearin higher health care costs, and cause many

doctors and other medical care profession-als to quit their practice or move to otherstates with lower medical malpracticeinsurance premiums.”

In an e-mailed statement to the BusinessJournal, California Medical AssociationPresident Dr. Richard Thorp said theproposition would result in higher costs tobusinesses, employees and patients.

“Under Prop. 46, employers could beforced to pass along higher costs toemployees, reduce or eliminate coverage orreduce pay and other benefits. It’s a flawedmeasure that’s costly for businesses andtheir employees. It also raises individualhealth care costs and puts patients at risk oflosing their trusted physicians,” the state-ment read.

Prop 47 Reduces PenaltiesFor Non-Violent Offenses

Proposition 47 reduces penalties for cer-tain non-violent offenses such as drug pos-session, shoplifting and check forgery.Violent offenders accused of these crimes,would still be eligible for harsher penalties.Money saved by the state on incarcerationcosts would be spent to support truancyprevention, mental health and substanceabuse treatment and victim services.Though the legislative analyst’s office esti-mates thousands of inmates could bereleased from prisons, initial savings topenal institutions would be offset by theincrease in parole services for the first fewyears following the change.

Supporters include the Women’sFoundation of California and San Francisco

District Attorney George Gascon.Opponents include the California StateSheriff’s Association and the CaliforniaCoalition Against Sexual Assault.

Proposition 48, CompactsWould Lead To New Indian CasinoProposition 48 ratifies tribal gaming com-

pacts between California and the North ForkRancheria of Mono Indians and the WiyotTribe, and allows construction of a newcasino in Madera county. The land to beused for the casino is 305 acres purchasedby the North Fork tribe in 2005, locatedabout 38 miles from the tribe’s reservation.If passed, this proposition requires the tribeto make a one-time payment between $16million and $35 million to local govern-ments in Madera County to address costsrelated to the operation of the new casino.

The compact would prohibit the Wiyottribe, located near the Humboldt Bayregion, from building a proposed casinonear the Humboldt Bay National WildlifeRefuge. As part of the agreement, theNorth Fork tribe would pay the Wiyot upto 3.5 percent of its annual slot machinenet revenue.

Annual payments of $10 million fromthe North Fork tribe to the state and tolocal governments in the Madera Countyarea are also required. Governor Brownsupports the proposition, as does the pres-ident of the State Building andConstruction Trades Council ofCalifornia. Opponents include the groupStand up For California, which seeks tolimit the expansion of Indian casinos. �

October 14-27, 2014 Long Beach Business Journal 21

BALLOT PROPOSITIONS


PERSPECTIVE22 Long Beach Business Journal October 14-27, 2014

EDITOR & PUBLISHER

George Economides

SALES & MARKETING EXECUTIVE

Heather Dann

SALES & MARKETING ASSISTANT

Cori Lambert

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Conrad Riley

EDITORIAL DEPARTMENT

SENIOR WRITER

Samantha Mehlinger

STAFF WRITER

Brandon Ferguson

CONTRIBUTING WRITER

Michael Gougis

PHOTOJOURNALIST

Thomas McConville

COPY EDITORPat Flynn

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Vol. XXVII No. 20

October 14-28, 2014

Dear EarthTalk: How is it that some food purveyorsare contributing to the destruction of tropical rainforestsby ditching unhealthy “trans fats?”

– Billy S., Salem, Oregon

Most public health advocates applaud effortsby processed food producers, restaurants and

fast food chains to get rid of so-called “trans fats” –partially hydrogenated oils added to foods toimprove texture and extend shelf life but which canaggravate heart disease. In 2013 the U.S. Food &Drug Administration (FDA) proposed eliminatingtrans fats altogether, but it is unclear if and whensuch a change will take effect. In anticipation,many big trans fat buyers have switched to palm oil,much of which comes from former tropical rainfor-est lands cleared for agricultural production acrossSoutheast Asia.

“The concern is that a lot of companies willswitch to palm oil in order to reduce trans fats with-out thinking more broadly about the health andenvironmental implications of that,” says BillBarclay, policy and research director at the non-profit Rainforest Action Network (RAN).

Palm oil may be a good substitute for trans fats inthat it stays solid at room temperature and is there-fore useful as a food additive in things like snackbars. But it isn’t much healthier: A 2009 study by thefederal Agricultural Research Service found thatpalm oil “would not be a good substitute for transfats by the food industry” because consuming eithertype of fat results in similar spikes in artery-clogging

LDL (“bad”) cholesterol and a protein (apolipopro-tein B) that distributes it throughout the bloodstream.

Meanwhile, the explosion in palm oil use overthe past few decades for biofuels and as a foodingredient and additive has wreaked havoc on trop-ical rainforest ecosystems across Southeast Asia.Environmental leaders are concerned that evenmore demand for palm oil could push some endan-gered species – including orangutans, Sumatrantigers and pygmy elephants – over the brink.“They’re losing critical habitat that threatens theirsurvival and that’s largely driven by palm oil expan-sion,” says RAN’s Barclay.

Higher carbon emissions are another downside. According to the Union of ConcernedScientists (UCS), the tropical peat soils that pre-dominate in Southeast Asia rainforests store hugeamounts of carbon. Clearing and draining thesefields to create palm oil plantations releases thiscarbon into the atmosphere.

Green groups continue to work with palm oilproducers and the governments that regulate themto promote more sustainable production and pro-cessing and toughen standards for conversion ofland to agricultural use, but progress has been slow.A recent commitment by five of the world’s largestproducers and traders of palm oil to stop clearing“critical forest areas” for one year during a study isa step in the right direction, but there’s no tellingwhether other producers will step up their ownexpansion efforts to fill the void, let alone whatkind of ramped up production will happen when thestudy is complete.

And while food scientists are working on otheralternatives to trans fats that could be greener andhealthier, none are as a cheap-to-produce and easy-to-process as palm oil, at least for applications requiringa food product to sit on store shelves at room temper-ature. The best thing we as consumers can do to keepour arteries and our consciences clear is to dial backour consumption of foods that include palm oil or anyother trans fat alternatives. Indeed, there’s never beena better time to put down those packaged bakedgoods and processed snacks altogether.

Contacts: FDA, www.fda.gov/Food/ucm292278.htm; RAN, www.ran.org; UCS, www.ucsusa.org.(EarthTalk® is written and edited by Roddy

Scheer and Doug Moss and is a registered trade-mark of E – The Environmental Magazine,www.emagazine.com. Send questions to: [email protected].)

Google is not knownas being a manage-

ment guru organization.After all, they createthings – technical stufflike search engines andproductivity tools likeGmail. They started outwith a philosophy of justleaving people alone.Let the engineers createtheir wonders. In fact 20percent of their work is

“free time” in which those creative geniuseshave come up with quite a sampling of prod-ucts. If they hit a snag or get bogged down,then they can approach one of Google’s man-agers who possess a deep technical expertise.

So why would Google go soft and talk aboutgood bosses and challenged bosses? Well, forone thing, they now have a houseful ofMillennials (Gen Y), who value a deeper andmore frequent connection with their man-agers. We know that organizations with a highdegree of connection produce employees whoare more engaged, and thus more productive intheir jobs. They are also less likely to leavetheir jobs to go to a competitor with a betterenvironment (which Millennials have beenknown to do).

In research conducted by my colleagues andmyself,1 we also discovered that Millennialswork well on teams. This results in moreshared information, better processes for doinggood work and, as a result, better products.Good managers produce more connection,which turns a dog-eat-dog environment into adog-sled team pulling together and creatingsynergy.

Google had a code for a research project:Project Oxygen. It was driven by their PeopleOperations, which is Googlespeak for human

resources. Rather than their usual mission ofinventing the next search algorithm or cleverapp, their mission was to build a better boss. Itwas a two-year study that gathered 10,000observations of managers across more than100 variables, numerous performance reviewsand feedback surveys. They coded and synthe-sized the results and came up with eightbehaviors that described the best bosses. It’sbeen called the Eight Habits of HighlyEffective Google Managers.

For all Google’s technical research there is asimplicity to these rules. Managers do notneed a personality transplant to apply these.They make sense on the surface.

Check out this list and rate yourself.1. Be a good coach. • Provide specific, constructive feedback,

balancing the negative and the positive.• Have regular one-on-ones, presenting

solutions to problems tailored to your employ-ees’ specific strengths.2. Empower your team and don’t micro-

manage.• Balance giving freedom to your employ-

ees, while still being available for advice. • Make stretch assignments to help the team

tackle big problems.3. Express interest in team members’ suc-

cess and personal well being.• Get to know your employees as people,

with lives outside of work.• Make new members of your team feel wel-

come and help ease their transition.4. Don’t be a sissy: Be productive and

results-oriented.• Focus on what the employees want the team

to achieve and how they can help achieve it.• Help the team to prioritize work and use

seniority to remove roadblocks. 5. Be a good communicator and listen to

your team.

• Communication is two-way: you both lis-ten and share information.

• Hold all-hands meetings and be straight-forward about the messages and goals of theteam. Help the team connect the dots.

• Encourage open dialogue and listen to theissues and concerns of your employees. 6. Help your employees with career

development.7. Have a clear vision and strategy for

the team.• Even in the midst of turmoil, keep the

team focused on goals and strategy.• Involve the team in setting and evolving the

team’s vision and making progress towards it.8. Have key technical skills so you can

help advise the team.• Roll up your sleeves and conduct work

side by side with the team when needed.• Understand the specific challenges of

the work.Pretty simple to understand, yet sometimes it’s

the simple things that make the biggest differ-ence. If you want your people to be happy andproductive, make sure you have time for them;be consistent; involve them in the process; don’tassume they understand the goal; and be fair.

Most managers communicate. The goodones connect.

1Chip Espinoza, Mick Ukleja and CraigRusch, Managing The Millennials: DiscoverThe Core Competencies For ManagingToday’s Workforce (Wiley & Sons, 2010).(Mick Ukleja has co-authored several books

including Managing the Millennials. He helpsorganizations create environments in which allgenerations can thrive. He is a keynotespeaker and president of LeadershipTraq, aleadership consulting firm. His clients haveincluded Fortune 500 corporations and non-profit organizations. Check his weekly blog atwww.leadershiptraq.com.)

� EFFECTIVELEADERSHIP

By Mick Ukleja

Google’s Eight Ways To Build A Better Boss

Palm Oil Production AndRainforest DestructionEarthTalk

Orangutan: Roger Smith; Clearcut: Greenpeace


PERSPECTIVEOctober 14-27, 2014 Long Beach Business Journal 23

Akey element thathas been largely

overlooked in theUnited States commer-cial real estate sector isthe increasing involve-ment of foreign buyersand their confidence inthe future of real prop-erty holdings in thiscountry.

The mind-set of the foreign investor isvastly different than the typical U.S.buyer, especially when it comes to expec-tations. Foreign investors begin with dif-ferent return goals from those of domesticreal estate investment trusts, institutionalowners and pension funds. Since the maingoal is to invest in a perceived safe-havenmarket where their money will be pro-tected, foreign investors have lower returnexpectations and will accept much longerholding periods to achieve a profit.Making a current return is sometimes asecondary goal.

Many deep-pocketed foreign investorsare strategically pulling capital out of theirhome countries and placing funds in U.S.real estate. New York has become the mostpopular U.S. market for foreign real estatebuyers, where 20 to 30 percent of all com-mercial purchases are made by foreigners.

While the U.S. real estate market has stabi-lized, some financial indicators havepointed to substantial credit and real estatebubbles in the Asian markets, for example.The puncture of these bubbles could welllead to some sort of financial crisis inChina or with regional neighbors such asAustralia and Singapore – and this concernis yet another reason we are now seeing anincrease in both direct and indirect foreigninvestment in the U.S.

While London continues to be the topdestination for out-of-country real estateinvestors, the fact that the other four of thetop five are in the United States (New York#2, San Francisco #3, Houston #4 and LosAngeles #5) speaks to the reputation of ourreal estate assets.

The survey of members of theAssociation of Foreign Investors in RealEstate points out that the U.S. is the “sta-ble and secure” country for real estateinvestment “by a wide margin.” The U.S.is also the top market when it comes tocapital appreciation and for future realestate purchases.

“Our members’ increasing interest incities beyond the powerhouses of NewYork, Washington and San Franciscopoints to the recognition of additionalinvestment opportunities for foreigninvestors,” James E. Fetgatter, the associa-

tion’s CEO, said. He also noted thatHouston’s high ranking shows thatinvestors are starting to look beyond NewYork and San Francisco for deals.

The countries of origin for this foreigncapital may be a surprise to many. Canadais the top foreign buyer of U.S. real estatewith Norway an unexpected second. Thetop category for foreign investment prop-erty in 2013 was industrial properties, fol-lowed by office, retail and multi-familyhomes. In 2012, multi-family homesranked first.

The real amount of foreign real estateinvestment, however, is a little elusivewhen you consider the fact that data com-panies such as Real Capital Analytics lookprimarily at deed transfers to determinetransfers to foreign investors and thereforetypically miss the substantial investmentsby foreigners who partner with domesticoperators. There are a number of benefitsfor partnerships like this, including safeand stable returns in a strong U.S. market,the ability to leverage the expertise of alocal partner who knows how to navigateextremely competitive U.S. markets suchas the New York City real estate market,and often the opportunity to mitigatetransfer taxes and higher property taxesthat would likely result if the foreigninvestor had acquired a controlling inter-

est in a property.Despite the fact that 2013 saw a record

for foreign direct investment in U.S. com-mercial real estate, it is most likely that theactual amount of foreign capital pouringinto U. S. real estate is vastly underre-ported. It makes sense that foreigninvestors are increasingly taking on domes-tic partners, and unwinding the facts ofthese transactions is sometimes hard to do.For U.S. operators, partnering with a for-eign investor offers greater access to capi-tal, and the ability to move quickly in amarket where timing is often the decidingfactor in closing a deal. However, as morecapital chases a constrained supply of com-mercial properties, cap rates are drivendown and prices up. Eventually local mar-kets feel the impact, as primary marketsbecome saturated and secondary marketsattract investor interest.

With a stabilizing U.S. market andseemingly more uncertainty around theworld, it wouldn’t be surprising to seemore records broken as 2014 comes to aclose, and more foreign money finds itsway to our shores.(Terry Ross, the broker-owner of TR

Properties, will answer any questionsabout today’s real estate market. E-mailquestions to Realty Views [email protected] or call 949/457-4922.)

� REALTY VIEWS

By Terry Ross

Foreign Real Estate Investment On The Upswing

I t’s that time ofyear again.

Time to makeanother mammo-gram appointment.You may feel likedragging your feetbecause it seemslike too much of aninconvenience, butmammograms areessential in thefight against breastcancer. Annual

screening mammograms reduce the num-ber of deaths from breast cancer amongwomen over the age of 40. In fact, it is rec-ommended that baseline mammograms bedone between the ages of 35 to 40, basedon family history. What is a mammogram?A mammogram is an x-ray picture of the

breast. There are two different types ofmammographic exams:

• Screening mammograms are forwomen who have no symptoms.

• Diagnostic mammograms are used toevaluate a particular symptom such as apalpable lump, nipple discharge, or focalpain. Follow up exams for a prior findingalso are in this category. Who needs a mammogram?We recommend that women between

the ages of 35 and 40 have a baselinemammogram. Once you turn 40, yearlymammograms are suggested. Dependingon your family history, your physicianmay recommend a baseline mammogramat an earlier age. Who performs my mammogram?

Certified, specialty trained mammogra-phy technologists perform each exam. What happens to my mammogram

after I leave?Since we only use digital mammography,

your images are digitized to a computerand stored in our system. They can be puton a CD or film, if you or your physicianrequests them.Who looks at my mammogram?Mammograms are read by fellowship-

trained breast radiologists on high-defini-tion screens. All of the radiologists are fel-lowship-trained subspecialists in breastimaging with more than 50 combined yearsof experience in their field. What happens if something is found

on my mammogram?If something is found on your mammo-

gram you will receive a phone call from aBreast Center nurse, asking you to returnfor additional imaging. You also willreceive a letter indicating that additionalimaging is required. Women often fretwhile they are awaiting results, but beassured that the team will let you knowquite quickly if something is found. What happens if there is no abnormal-

ity on my mammogram?You will receive a letter explaining your

results and recommending to scheduleanother mammogram when due. Can I only come at the same time

every year?Most women come for their screening

mammogram at the same time each yearbecause it is easier to remember year-to-year. If you notice something during a self-breast exam, we encourage you to go toyour primary care physician for a clinical

breast exam right away. Your physician willbe able to determine if you need to be seenhere for a diagnostic exam. A lump or focalproblem in your breast, no matter howsmall, is not something to ignore. How do I do a self-exam at home?There is no right or wrong way to check

your breasts, as long as you examine theentire area of your breast tissue – includingfrom your collarbone down, and underyour armpits and nipples – well enough tonotice any changes. The best time to per-form a breast self-exam is after your men-strual cycle ends each month, when yourbreasts are least likely to be swollen andtender. If you no longer have your men-strual cycle, choose a day that’s easy toremember for your self-exam.

Breast cancer does not discriminate.

Some women are genetically predisposedto the disease, while others have no riskfactors other than being female. It is impor-tant to understand that the great majority ofwomen who are diagnosed with breast can-cer have no risk factors and no family his-tory of the disease.

By performing monthly self-exams andgetting regular clinical breast exams andmammograms, you can increase the likeli-hood that if breast cancer is diagnosed, it isfound early and is curable. Know yourbody and listen to it. Seek care if you thinkyou are at risk or might have breast cancer.

Own your health and schedule youryearly mammogram.(Homayoon Sanati, M.D., is the medical

director for the MemorialCare BreastCenter at Long Beach Memorial.)

Breast Care 101 – Mammograms And Prevention

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� HEALTHWISE

By HomayoonSanati, M.D.


FOCUS ON THE GOODS

MOVEMENT INDUSTRY

Presented By The Long Beach Business Journal • October 2014

1_GoodsMovementPages_SaluteToFoster 10/11/14 5:10 PM Page 1

Education And Training Core To Goods Movement Industry

� By TOM O’BRIEN

T his special section of the Long Beach Business Journal re-flects the importance of goods movement to our local com-

munity, and highlights some of the key challenges confronting theindustry. As the article by Dr. Genevieve Giuliano suggests, the indus-try responds to those challenges with the support of a strong researchcommunity. It’s not surprising that Southern California is home to acollection of world-class, freight-focused researchers who help to shedlight on why the supply chain behaves the way it does and how keystakeholders might be able to do things better.A robust goods movement industry also depends on well-educated

and trained professionals at all levels to keep the goods flowing. Theindustry can do on-the-job training, but it depends upon those of us incolleges and universities to make that job easier. That means turningout graduates with strong foundational skills in writing and math, aswell as those with more specialized skills that directly feed into careersalong the supply chain.I’m proud to say that California State University, Long Beach has

been recognized for its efforts in developing the next generation offreight and logistics professionals. In September, CSULB’s Center forInternational Trade and Transportation (CITT) was named the FederalHighway Administration’s (FHWA) Southwest Regional Surface Trans-portation Workforce Development Center of Excellence. It’s a long titlewith a big mission: to serve as a clearinghouse for information on ed-ucation and training models for the wide range of transportation sectorsand for all points on the educational spectrum. That means from kinder-garten through retraining for advanced professionals. Oh yes, and allof that for an eight-state region: California, Arizona, Nevada, NewMexico, Utah, Colorado, Oklahoma and Texas. It’s not a small task. Butit’s an important one. And four other centers will be doing the samething in other parts of the country.There is good work being done across our region, but up to now there

hasn’t been a go-to entity responsible for bringing together the best effortsof federal, state, regional and local departments of transportation and ed-ucation, schools and industry, and other public and private stakeholdersinvolved in transportation planning, operations and education. We’ll serveas a resource with broad-based knowledge of transportation workforce is-sues including effective training programs, lesson plans, and fundingstrategies. We will also help pilot innovative training and education pro-grams in partnership with schools and industry and help facilitate theiradoption throughout the Southwest and, by extension, the entire country. We’re not doing it alone. We have a team that includes our METRANS

partners at the University of Southern California. We also have partners

at Texas A&M University’s Transportation Insti-tute (TTI) and have brought on board experts withknowledge of cutting-edge approaches to developingnew learning tools, analyzing labor markets and under-standing the needs of today’s market for transportation-re-lated education, whether in engineering or logistics or oneof the many other disciplines needed for mobility.The timing is critical because the challenges are great – but

so are the opportunities. At a recent forum in Washington,D.C., where the five regional centers were announced, the U.S.departments of transportation and education presented prelim-inary findings on a study of future transportation workforceneeds. The analysis, conducted by Jobs for the Future and theTransportation Learning Center, identified occupational “hotspots” and assessed both the educational and work experiencesneeded for someone to be deemed competent to work in any ofsix different transportation sectors, including trucking and themaritime industry.The study revealed a transportation workforce of over 4 million

people in this country. This is a conservative estimate since the dataexcluded fields like warehousing that depend greatly upon trans-portation. It identified challenges in increasing the numbers ofAfrican Americans and Hispanics in transportation occupations and,at the same time, filling the ranks of the soon-to-be-retired in thetransit and maritime industries.And, despite the very real concerns about our state’s economy, the

study’s authors project that California will have one of the highest ratesof growth in transportation employment (18 percent) through 2020.States with key trade gateways and intermodal centers generally do wellon the list. These include Louisiana and Texas. The biggest growth isexpected to occur in North Dakota where the transport sector serves inlarge part a booming energy industry.Another recent study, this one prepared by the American Association

of State Highway Transportation Officials (AASHTO), looked at thestate of the workforce in state transportation departments. Across theboard, officials in states of varying size and location expressed concernsabout their ability to recruit employees from an applicant pool withoutthe right set of skills, retain workers who increasingly move betweenjobs more often than previous generations and adequately train work-ers, particularly to move into upper management. This latter phenom-enon was discussed at the forum as the “buddy-to-boss” problem.There is no one solution to all of these challenges. The transporta-

tion industry will solve some of the workforce needs on its own. It al-ways has. Goods movement in particular has relied upon a lot ofon-the-job training to get employees ready for a constantly changingset of conditions. In an often fragmented supply chain, there has alsobeen a lot of mistrust of training from “the outside.” But that’s changing as employers of all kinds find a need for

workers with strong foundational and analytical skills that needto be taught early in a student’s educational career. That’s whyCITT recognizes the need to begin advertising transportation asa serious career pathway when children are fascinated by trucks,trains and ships and then identify opportunities for them to turnthat interest into knowledge. Then it’s our job to work with theemployers to determine what skills are needed and to makesure the programs we offer fit the bill. It’s not an easy job, but it’s a vital one. And it is my hope that

the new resources we can bring to the table as a result of ourrecognition by the FHWA will help us demonstrate to the restof the country the tremendous leadership, capacity and inno-vation in the goods movement industry here at home.

(Dr. Thomas O’Brien is the interim executive director of theCenter for International Trade and Transportation at CSULB andan associate director for the METRANS Transportation Center, apartnership of USC and CSULB.) �

GOODS

MOVEMENT

3

InsIde ThIs Issue3 education And Training Core To Goods Movement Industry

4 Changing strategies Of Chassis Management And Resolving The ‘Ripple effect’

8 energy And Goods: efficiency And export Potential

10 Warehousing: The Pivot Point Of The supply Chain

12 Real And Perceived union Actions Can Cause Ripples In The Movement Of Goods

14 MeTRAns Looks For Most efficient Ways To distribute, Warehouse And Move Goods

Prepared By The Long Beach Business Journal2599 e. 28th street, suite 212, signal hill, CA 90755

562/988-1222 • www.lbbusinessjournal.comreproduction in whole or in part is prohibited without

written permission from the publisher


ChangingStrategies

Of Chassis Management And Resolving The ‘Ripple Effect’


Senior Writer

A shortage of a basic piece of trucking equipment is caus-ing major congestion issues at the San Pedro Bay Ports,

impacting all entities involved in the logistics and goods movementindustries. That piece of equipment is called the chassis, the frameand wheels upon which a container sits on a truck. The chassis crisis emerged when ocean carriers began divesting

themselves of their chassis a year and a half ago, selling or turningover their leased chassis to intermodal equipment providers, accordingto John Cushing, president of PierPass, a nonprofit aimed at reducingcongestion and improving air quality in the ports of Long Beach andLos Angeles. There are three competing intermodal equipmentproviders in the area controlling the majority of chassis used throughoutthe ports: DCLI, Inc., Flexi-Van and TRAC Intermodal.“They thought it was just going to be too big of a challenge opera-

tionally and financially to manage these chassis,” Alex Cherin, execu-tive director of the Harbor Trucking Association, explained. “The challenge has been that, in this transition, the chassis providers

have not put enough chassis out into the marketplace to meet demands,”Cushing said. “Many trucks are coming down to the terminal to pickup a container and they don’t have a chassis, or there is not one avail-able down at the terminal from these intermodal equipment providers.” If truckers have to wait to load a container until they are able to se-cure a chassis, a backup occurs at the terminal as laborers have to shiftthe container to make room for more cargo being unloaded from thenext ship coming in. Then the container has to be retrieved when thechassis is finally available. This causes wait times for truckers liningup at terminals to pick up their cargo. And all of this backup meansthat whoever owns the cargo in the container is left hanging, unableto control when they receive their shipment.“It has a ripple effect throughout the entire operation,” Port of

Long Beach Chief Executive Jon Slangerup told the Business Jour-nal. Now that the port is regularly receiving large container shipscarrying 10,000 twenty-foot equivalent units of cargo or more, itis key to have the infrastructure in place to handle that cargo – andwithout enough chassis, that has not been the case. “You need everything working well to manage the velocity andthe throughput,” Slangerup said. “You have to have the rail sys-tem working well, the trucking operations working well and youhave to have the beneficial cargo owners (companies importingor exporting goods) prepared to receive the freight. It is a veryintegrated system with little or limited oversight. My view isthat, while it works okay in non-crunch times, when the crunchhappens it can come apart pretty quickly.”“At this stage of the game, at this moment in time, chas-

sis really are the number one problem in the center of thiscongestion issue,” Slangerup said. “We are highly sensi-tized to the pain everybody is feeling in this process. Theshipping companies are struggling because we are aboutthree to five days behind as an operation in terms of whatwe normally do in throughput.”“The congestion results in delays,” Cherin said. “Typically,

your large cargo owners like a Target or a Wal-Mart have acertain number of containers every night that they need tomove from the terminals to their distribution centers. In thelast year, they’ve been getting only a fraction of those becauseof congestion. And again, the chassis are one component ofthe congestion.”Noel Hacegaba, chief operating officer for the Port of Long

GOODS

MOVEMENT

4



GOODS

MOVEMENT

5

Photograph by the Business Journal’s Thomas McConville


Beach, acknowledged the chassis-related congestionhas financial consequences. “It is just as important to

get the cargo from the port to the warehouse as it is toget it from the warehouse to the final point of destination.Speed to market and getting the goods across the cash reg-ister – that’s the way you make money.”Cushing said part of the reason there aren’t enough chassis

available is that they are not being repaired in a timely mannerafter use, which is the responsibility of the intermodal equip-ment providers. Bill Shea, president and CEO of DCLI, told the Business Journal

that his company “is currently repairing chassis seven days a week,at considerable expense, to reduce the out-of-service percent ofchassis.” He added that the availability of mechanics has been “alimiting factor for all three leasing companies.” Also at issue is how the chassis are managed. With three separate

companies controlling most of the chassis around the port complex,they each require their chassis to be returned to specific locations.So when a trucker unloads cargo at a terminal, the trucker has to takethe chassis back to a different location. This is what is known as a“split move” in the trucking industry.“All of our core stakeholders – the terminal operators, the shipping

companies, the trucking companies, the beneficial cargo owners – allof them have directly and frequently expressed their frustration aboutwhat’s happening,” Slangerup said. A Silver – Or Gray – LiningStakeholder groups in the goods movement industry, including the

Port of Long Beach, Port of Los Angeles, PierPass, the Harbor TruckingAssociation and the intermodal equipment providers themselves havebeen working together for about a year to try to identify a better strategyof chassis management to alleviate congestion at the ports. “I think wewill have it solved next year,” Slangerup said.“Our job is to facilitate discussions among stakeholders and try to

find the common ground between them and encourage, and in somecases initiate, efforts to implement solutions,” Slangerup stated. “Weput together a chassis operations group more than a year ago in antic-ipation of the shift where the major ocean carriers divested their own-ership in chassis and these new asset management companies pickedup those chassis with the intent of conducting commercial business,”he explained. The chassis operations group is made up of stakeholdersincluding both ports, railroads, trucking companies, ocean carriers,terminal operators, beneficial cargo owners and workers. “We were simply trying to be as proactive as we could in forminga group to assess how those individual [chassis] pools would satisfydemand,” Slangerup said of forming the group. “Obviously you cansee it did result in dialogue between the chassis pool owners, but

the actions have taken longer than what anybody anticipated and has re-sulted in this near-term crunch.” Both the Long Beach Board of Harbor Commissions and the Los An-

geles Board of Harbor Commissioners have formed port efficiency sub-committees to address congestion issues at the ports. Long BeachHarbor Commission Vice President Rich Dines and Commission Sec-retary Lori Ann Farrell head up Long Beach’s committee, while LosAngeles Harbor Commission Vice President David Arian oversees theLos Angeles committee. In early October, Slangerup created a congestion relief team, focused

on the chassis management issue, as a subset of the Long Beach port ef-ficiency committee. Dialogue among the three main chassis providers, spearheaded by

DCLI’s Shea, may soon result in a near-term solution, Slangerup said.DCLI, along with Flexi-Van and TRAC, initiated a joint solution to applya management system that would allow them to bill each other and ulti-mately bill the customer for the chassis as they are used on a unit basis.”He called this an “interoperable agreement.” Shea told the Business Journal that DCLI, TRAC and Flexi-Van began

“injecting approximately 6,000 [new] chassis into the Southern Californiain August.” He estimated about 3,000 new chassis would be delivered inOctober and November. In the mean time, DCLI has created hotlines anddaily e-mail blasts to inform motor carriers about chassis availability andtheir locations to help alleviate congestion. DCLI and Flexi-Van have alsobeen in daily communication about “sharing surplus assets at commonfacilities,” Shea said.In the long-term, what Slangerup and many others believe is needed is

a chassis management strategy called a gray chassis pool. In a gray pool, “chassis are really neutral in terms of where you pick

them up, where you return them and how you use them,” Cherin ex-plained. “They would be managed centrally by one entity and have moreof a uniform operation,” he added, noting that it appears a gray chassispool strategy is likely to be implemented in Long Beach and Los Angelessome time in the future.“Clearly the long-term solution is a gray chassis fleet or a pool of chassis

managed in an interoperable manner where the trucker wouldn’t have toworry about returning a chassis back to its origin but could return it toany terminal,” Slangerup said. “The efficiency of that process . . . wouldbe dramatically improved over what it is today. The work that DCLI, Flexi-Van and TRAC are putting together under Bill Shea’s leadership actuallyhas a chance of satisfying that.”According to Shea, DCLI and Flexi-Van plan to implement a new

chassis pool management model in early 2015 which would make about90 percent of chassis in the area part of a gray pool, “creating interop-erability for motor carriers and terminal operators.” He called the modelthe “Pool of Pools,” which he said would hopefully be ready to go onJanuary 1, 2015. �

(Continued From Page 6)

Photograph by Tim Rue

GOODS

MOVEMENT

6


Energy And Goods:

Efficiency And Export Potential

� By MICHAEL GOUGIS

Contributing Writer

C lean-air regulations, the savings of automation and theenergy explosion across North America are combin-

ing to transform the way goods are moved through the ports of LongBeach and Los Angeles, and even hold the potential for reshapingthe ports themselves, experts say.Zero-emissions equipment, automated machinery, increasing effi-

ciency and interests in alternative fuel sources all are driven by thepotential for an improved bottom line. Simply put, all other thingsbeing equal, using less energy saves any business operation money.“North America is undergoing a major shift. The significant changes

in the [energy] production system in North America are causing im-pressive adjustments in the system that we haven’t seen in my lifetime.We are in a period of major change,” says Don Paul, executive directorof the University of Southern California Energy Institute and theWilliam M. Keck Chair in Energy Resources.As the local ports are adjacent to residential areas and are in a geo-

graphic region that struggles with air quality, regulations and marketforces have pushed goods-handling operations toward zero-emissionsequipment. Cranes and cargo haulers are not only now fully electric butin some cases are fully automated. And the fact is that the ports willbecome more and more reliant on electricity in the future.“What we’re going to see is a continuing reliance on the grid

to provide power to the port,” says Carter Atkins, an environ-mental specialist at the Port of Los Angeles.While port officials started the push to electricity, requiring

ships at berth to plug in to onshore electrical power sourcesrather than continuing to run their diesel engines, risingdiesel prices are helping move the goods movement industryin that direction.“Initially . . . the goal was to make it cost-neutral betweenburning diesel fuel and using electrical power,” Atkins says.“Due to the Air Resources Board fuel regulations, as well asbeing in an emissions-controlled area, we see the price ofdiesel fuel continue to rise. It looks like the numbers areshowing that using electricity is cheaper than burning dieselfuel, particularly the low-sulfur diesel fuel that ships haveto use within 24 nautical miles of the ports.”Not to overstate the obvious, but there are two ways to en-sure that electricity prices remain competitive and the powersupply remains adequate to the demand: Use less and createmore. The ports are looking in both directions. The replace-ment of the lighting at the facilities with low-energy LEDunits promises a reduction in electricity use of up to 50percent. And the installation of solar power generating ar-rays atop port buildings, parking lot covers and otherwiseunusable real estate can help generate renewable power.Another energy-related change in the goods move-

ment industry has to do with the dramatic expansionof oil and natural gas production in North America. InCanada, Mexico and the United States, oil and gas pro-duction has ramped up so much that, not only are sup-plies plentiful, prices are low. This reshapes the goodsmovement infrastructure in many ways.“There’s a huge shift going on throughout North

America,” says Ron Heffron, vice president at Moffatt& Nichol, an international engineering firm headquar-tered in Long Beach. “We’re not bringing in as much crude aswe used to. Instead, the crude is coming by pipeline and someby rail from some of our domestic sources that are producingat a record pace. The Bakken shale formation in North Dakota,the Eagle Ford shale in Texas. That’s changing the dynamics ofthe industry dramatically. It’s negating the need for bringing inoil from faraway places like Saudi Arabia into the West Coast.

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Zero-emissions equipment on the docks at the Middle Harbor project under construction at the Port of Long Be pay environmental dividends all the way down through the system, from cleaner air to cleaner water. Such eqpowered by renewable solar, also can help companies clean up their bottom lines. Above: These battery-powe tainer movers are automated and follow sensors embedded in the pavement. Efficient movement of container and full, is critical to economic as well as environmental sustainability. Top: Inside this building, battery-powere emissions cargo moving equipment will have their battery packs swapped out within three minutes, or less tim takes to refill a large piece of diesel-fueled equipment. When the project is completed, operations at Middle will be among the most energy efficient in the world. (Photographs by the Business Journal’s Thomas McConv


Instead, there are a number of companies look-ing at building crude-by-rail terminals. So they’rebringing in crude that will feed local refineries. It by-passes the marine facilities in the port and adds thisnew rail component.”One manifestation of that change is in the way cargo ships

are fueled. You can’t use batteries to get an 18,000 TEU cargocarrier across an ocean – at least, not yet. So the ships require liquidfuel. Traditional diesel is dirty. Low-sulfur diesel is more expensive,but it can simply be poured into the existing ships and it will work.Liquid natural gas is cheap and clean, but it requires retrofitting aship to use the new fuel. It’s all a balancing act, with the bottom lineas the fulcrum, and it is changing the vessels used to move goods.“Now there’s a big push to lower the cost of operating vessels

while cleaning up the air, and LNG fits that bill,” Heffron says. “Butit requires new infrastructure. It’s a slow change. It’s happening ini-tially with coastal trades that are short sea shipping-type arrange-ments. So, for serving places like Puerto Rico, there are LNGbunkering [fueling] stations in places like Jacksonville. Then you’vegot places like Puget Sound looking at LNG bunkering for tote vesselsserving Alaska – it’s that sort of trade. Matson is building LNG-pow-ered vessels that are really dual-fuel vessels to serve the Hawaii trade.There are very few transoceanic monster container ships that are goingin this direction at the moment. So the market right now and in the nearterm is going to be for shorter-distance vessels.”“It’s still an unknown,” Paul says. “Certainly the introduction of

ultra-low-sulfur diesel addresses a lot of the emissions issues anddoes not require a change in the hardware of the vessel. How muchit changes will play out over an extended period of time. It takes along time to convert a fleet. Equipment lasts a long time, and shipsin particular last a long time.”However, with the production of oil and LNG skyrocketing, pressure

is building to change the laws preventing the export of U.S.-producedoil. If it changes, expect to see changes in the ports, especially the onesassociated with refineries.“Interestingly enough, we’re seeing the conversion of LNG facilities

that were designed and under construction 10 years ago for imports, inanticipation of a shortfall in natural gas production. They are now beingreconfigured for export,” Paul says. “We are in a period of majorchange. But these things tend to be focused on whatever companionsare taking place in the refining system. So ports associated with re-fineries are going to see some of this change.”“The challenge is that LNG is very, very cold,” Heffron says.

“You have to use cryogenic hoses. LNG is a gas that’s been cooledto minus 260 degrees. You have to keep it at that temperature.There are plenty of challenges. Keeping the fuel cool and also youhave an issue of boil-off, so you can’t store it for long periods oftime like you can with traditional fuel. You’ll have a boil-off sit-uation and you’ll lose a lot of volume.”“The other issue is with siting,” he says. “The proximity issues

become important. There are lots of entities, including a workinggroup within the International Association of Ports and Harbors,that are looking at how you resolve the safety issues of workinga vessel in a port while that vessel is being bunkered (fueled)from the other side. If there’s an incident, it has the potentialto be very disruptive to the port.”From fueling ships to moving containers to lighting stores,

energy efficiency through the entire production, distributionand retail chain has become a major area of interest, saysChristopher Tang, a UCLA Distinguished Professor and Ed-ward W. Carter Chair in Business Administration and visitingprofessor at U.C. Berkeley’s Haas Business School.“Companies are aware that they have to factor energy costs

into the consideration, which they did not have to do as muchin the past,” Tang says. “Companies, like Walmart, have em-barked on studies. Walmart, in particular, is deeply involved instudies on energy consumption along the supply chain. They areworking closely with their vendors and in their retail stores tocut down on energy consumption. So, for example, many of thestores are using low-emissions light bulbs, they reduce their light-ing, and they use more energy-efficient refrigeration to help themreduce energy costs. They are also conducting audits of their ven-dors to encourage them to reduce energy costs as well.“With their vendors, with their shippers, and also with their [rail

networks], they are reconsidering the way they produce goods andthe way that they transport materials.” �

ction at the Port of Long Beach will to cleaner water. Such equipment,

Above: These battery-powered con- ent movement of containers, empty

his building, battery-powered, zero- n three minutes, or less time than it

eted, operations at Middle Harbor Journal’s Thomas McConville)

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Warehousing:The Pivot

Point Of The Supply Chain

� By MICHAEL GOUGIS

Contributing Writer

W hile looking at the mind-warping variety ofgoods in even the smallest retail outlet at a fash-

ion mall, it’s hard to envision the state in which those productsarrive in Southern California. But imagine opening a shippingcontainer and finding nothing but a single style of a particular bluerunning shoe – and what appears to be about a gajillion of them –and being tasked with accurately sorting, tagging, repackaging andshipping them to stores across the nation.Categorizing the raw material, preparing it for presentation to the con-

sumer on the retail floor and repacking it for the final leg of the journeytakes place in the network of warehouses that serve as the points of entryfor goods entering the United States through the ports of Long Beachand Los Angeles – the busiest port complex in the nation.“Warehousing is a critical component of the supply chain. It’s ac-

tually a pivotal point because that’s typically where goods are com-ing in in a more raw state and leaving in a more finished state,” saysLance Ryan, senior vice president, marketing and leasing for theCarson-based Watson Land Company.“Usually, in terms of import product that’s coming in from overseas

manufacturers, they are going to have an entry port, and the WestCoast has a high volume of imports, so we’re typically seeing that atour warehouses here in Carson, Long Beach, Rancho Dominguez.That’s going to be the point of origin initially for those goods. Thewarehouses here act like a point of entry, just past the port by a fewmiles. That’s where the product is initially re-manipulated, packagedfor final consumption and sent out.”As manufacturing and retail processes evolve and become more ef-ficient, warehouse functions are transforming as well. Locations, landcomplex designs and the buildings themselves are constantly evalu-ated and re-evaluated in terms of the shifting political environmentsand the ever-changing economic needs of retailers, both traditionalphysical location operations and online sales outlets.

The changes in retail from a location-based purchase operation to In-ternet-based sales have changed the actual warehouse facility, says TomO’Brien, the acting executive director at the Center for InternationalTrade and Transportation at California State University, Long Beach.The building might be a center for breaking down bulk goods or serveas a “fulfillment center” with an automated distribution system for fill-ing orders, although on the coast, just a few thousand yards from theports, the former is more likely than the latter.“It has been driven by changes in retail, a shift to what many are calling

omni-channel distribution,” O’Brien says. “You’re not just serving retailestablishments, traditional retail establishments, but retail plus home de-livery, plus locker service like Amazon.com. There are retail models whereyou’ve got pick-up-in-store goods that have been ordered online. “All of these different channels are changing the footprint of ware-

houses because they need to be more flexible. The newer warehousesare 30 to 40 feet high instead of 26 feet high. They’ve got a bigger foot-print, they’ve got wider aisles, and they’re located much closer in tourban areas so they can serve as fulfillment centers and not just [per-form] warehouse and storage [functions].”The shifting nature of the warehouse and the economic system by which

goods are retailed has led companies to re-evaluate location, balancingspecific needs with distribution costs and tax landscapes. The latter hasproven to be a tricky topic: Minnesota attempted to tax warehousing op-erations, only to rescind the tax earlier this year. “States are playing catch-up, trying to figure out how to regulate these new types of businesseswithout driving them away,” O’Brien says.It is the varying tax landscape that has led Amazon to locate fulfill-

ment (order-filling) centers east of California, but has left other largeretailers comfortable with large operations in the state, says ChristopherTang, a UCLA distinguished professor and Edward W. Carter Chair inBusiness Administration, visiting professor at U.C. Berkeley’s HaasBusiness School and the author of several books on retailing, supplychain management and operations.“There are multiple facets to this issue. Sometimes the warehouses are

close to the producer to ease the storage of the produced goods. And some-times the warehouses are closer to the customers, because that reducesthe last-mile transportation costs,” Tang says. “It is a trade-off over that. “The online stores, in particular companies like Amazon, have to factor

the state taxes into the consideration. That is why for a long time Amazonhas not had a warehouse in California – they did not want to pay a state taxin California. That’s why they are in Reno; that’s why they are in Arizona.Then they factor the tax issues into energy and operating costs, everything. “That is for the online stores. For the brick-and-mortar stores, that is

much less of an issue, because they have to pay the state tax wheneverthey sell the product.”

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Pictured here is the warehouse for C.H. Robinson LA Gateway Management Center at Watson Land Company’sDominguez Technology Center in Carson. On adjacent page, top, a truck is loaded at the Cal Cartage facility in Wilm-ington, and at right is the Costco store in Lakewood. (Photographs by the Business Journal’s Thomas McConville)


So warehousing location becomes a function of a complex series of cal-culations, all aimed at maximizing the bottom line, Tang says.“So now they are doing research work to try to decide where to lo-

cate the warehouse and what kind of transportation mode they shoulduse to lower the total cost. The total costs include the energy costs aswell as transportation costs as well as the duties – especially whenyou are dealing with imports. So they have to look at the total costsof operations. “You look at a company like Coca-Cola: they have to decide where

to have their bottling plants, where they should have their warehouse,where they should have their distribution centers, where they shouldhave it shipped to the retailer. They also have spent a great deal of timeautomating the system.”External economic forces also have helped reshape the location and

function of the warehouse facility – the building and its environs – asthe ports look to maximize the speed at which cargo is processed andmoved out of the terminals (thus lowering costs for the shippers andretailers), while minimizing the impact of increasing cargo traffic onthe municipal infrastructure.“Of the product that comes in, roughly 40 percent is going to be con-

sumed locally,” says Ryan. “By that, we mean the West Coast. The re-mainder of that is what’s called discretionary freight, and that’s goingto be land-bridged. That means it’s going to be moved from the ware-house via truck or intermodal, and that’s going to be destined forChicago or the East Coast. So that’s typically what’s happening. It’s re-ally a national gateway to the Pacific.”As a point of entry, the process that takes place in the warehouses adja-

cent to the ports is what Ryan calls “value-add” – moving the productcloser to the condition in which it will actually be sold to the customer.“Value-add work is often where cartons are opened up and parts of

the product are taken out and re-packaged. And they’re re-packaged ina format that’s specific for a retailer. You may have boxes of same-colorshoes, and those are separated out by size and then segregated to goout to specific stores,” Ryan says. “As another example, you’ll see thatwith apparel goods. They’ll arrive in a carton, and they’ll be taken out,they may be steam-pressed, they may have tags added on, that are spe-cific to retailers for price and sizing, and so on. They have garmentbags put over them and they are sent out.“With the sophistication of business logistics, a lot of the activities that

may have occurred at the retailer in the past . . . now occur at the third-party logistics provider level. And those third-party logistics providers arehired by the retailers to handle the product or the freight, to package it ap-propriately and deliver it to the retail store.”These processes mean warehouses are planned and built differently

now, Ryan says.

“Definitely there are two things that customersare looking for now in terms of functionality –more dock door positions and secure truck yardareas. Going back several years, when [security passes]were implemented at the ports, there was an increase inoff-peak-hours moving of goods out of the ports – whichis a good thing. It makes them more efficient, and it putstrucks over the road at night when there is less traffic and lessconflict with other transportation modes. “As a result of that, though, there are loaded containers com-

ing in at all hours,” Ryan continues. “Often those are off-hours,and they need somewhere to put them. They’re not going to workthe freight, perhaps, until the morning when the next shift ar-rives. So they need a secure location for them.”A warehouse is a busy place. A 24-hour warehouse operation

is a busy place around the clock. The best neighbor for a 24-hourwarehouse operation is – another warehouse.“The other piece that we’ve seen is a strong demand for master-

planned industrial centers,” Ryan says. “The reason we’re seeing thatis that these operators have had to move to more of a 24/7 model as aresult of moving to bringing in containers during off-peak hours. Sothey need to be in an area which is compatible to their use, where theirsurrounding users are doing the same thing and they’re not conflictingwith other uses.” �

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Real And Perceived

Union Actions Can Cause Ripples In TheMovement Of Goods


Staff Writer

W hile labor unions wield significant leverage in negoti-ating for higher wages and benefits and have the

power to disrupt international trade with strikes, their effect on theeconomy can, at times, be overstated – depending on whom you ask.On October 9, the National Retail Federation (NRF) sent a letter

to the president of the International Longshore and WarehouseUnion (ILWU) and the chairman of the Pacific Maritime Association(PMA). Both have been engaged in secretive negotiations over a newlabor contract for nearly 20,000 longshore workers employed at 29West Coast ports. Though the previous six-year contract expired onJuly 1, ILWU workers remain on the job. In the letter, signed by NRF President Matt Shay, the federation

argued that the prolonged discussions are leading to congestion atthe port, which is having an adverse impact on the flow of goods inadvance of the holiday season. Shay urged both sides to quickly cometo an agreement.“Finalizing a new labor contract is an absolutely critical component

to working through the backlog of shipping containers now piling upat West Coast ports,” the letter read.

Speaking to the Business Journal, NRF’s Jonathan Gold, vice presi-dent of supply chain and customs policy, said the lack of a contract hasled to the hiring of unskilled workers at the ports as well as uncertaintyover who’s responsible for the maintenance of the chassis that trucksuse to haul goods. On the issue of chassis, Gold explained that since shipping lines recently

began selling their inventory of chassis to private interests not involvedin the contract talks, confusion has reigned over who is responsible forchassis repair. Sources tell the Business Journal that ILWU negotiatorsare pushing for full responsibility over chassis repair and maintenance.“From what we understand, it’s taking longer than it normally does so

you have a lot of chassis that are being laid up and not moving,” Gold said.Port of Long Beach spokesperson Lee Peterson declined to comment

on the ongoing contract negotiations but said that congestion at the portis likely stemming from chassis shortage issues unrelated to contract ne-gotiations [Refer to article on chassis management, Page 4]. He addedthat port officials are eager to see a resolution.“As always, we’re looking forward to a resolution and meanwhile the

ports are open and cargo is moving,” Peterson said.A spokesperson for the PMA said he, too, couldn’t comment on the con-

tract negotiations, and directed the Business Journal to a series of jointpress releases issued by the PMA and ILWU. The most recent one, issuedin late August, stated that the groups had reached a tentative agreementon the issue of health benefits. The Business Journal also reached out to ILWU spokesperson Craig

Merrilees who, though he declined to comment on the negotiations, dis-missed the NRF letter as “silly” and referred to the group as anti-union.“You know, it’s Target and Walmart,” he said.When asked about the media blackout surrounding negotiations, Mer-

rilees explained it allows negotiators to focus on the task at hand.“The negotiators have decided to focus on getting the job done at the

negotiating table instead of feeding the media circus that sometimes sur-rounds negotiations,” Merrilees said. “It’ll be done when it’s done. They’reworking as hard as they can to get it done.”Jock O’Connell, an international trade advisor with Beacon Econom-

ics, explained that he too doesn’t think the NRF’s letter holds water. Hefurther added that much of the port’s current problems have less to do

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Photograph by the Business Journal’s Thomas McConville


with uncertainties surrounding organized labor and more to do with theissue of chassis ownership.“I can appreciate the National Retail Federation being anxious that

something untoward will happen, but it seems nobody else I’ve talked tohas expressed any anxiety that there’s going to be some sort of disruptionat the ports stemming from a breakdown in negotiations,” O’Connell said.He explained that the NRF’s fears stem from the fact that ILWU laborers

are essential links in a supply chain – a chain that includes tugboat pilots,terminal operators, distribution centers and truck drivers. Each, O’Connellsaid, has significant power to disrupt trade.This summer, more than one hundred truck drivers who ship goods from

the ports of Los Angeles and Long Beach launched a five-day strike,briefly halting the flow of cargo through the ports. The drivers, who aren’tunion employees, work for three companies: Pac 9, Green Fleet Systemsand Total Transportation Services (TTSI). They argue that they are im-properly classified as contract workers, which they say allows truckingcompanies to pay unfair wages. Alex Cherin, a spokesman for the trucking companies, said the strikes

were just an attempt by outside groups, specifically the Teamsters Union,to organize the truckers.In July, Los Angeles Mayor Eric Garcetti ordered a “cooling down” pe-

riod, promising an investigation into potential labor law violations. Thetruckers returned to work and, for now, quiet prevails. But it’s uncertainwhen strikes could resume.“It’s pretty quiet right now, but this is an issue that’s been going on for

20 years,” Cherin said. “Ever since the deregulation of the trucking in-dustry in the 1980s, various labor groups have tried to come in and or-ganize independent contractors and various companies. I’m sure that itwill be an issue again going forward.”Barb Maynard, a spokesperson for the Teamsters Union, said truckers

continue to be dissatisfied with the situation, adding that workers havebeen illegally fired in the wake of the summer strikes.“We are still technically in that cool-down period, although the compa-

nies are consistently violating the terms of that cooling off period. Thedrivers are really assessing the situation and assessing what they want todo, and talking amongst themselves to make a decision,” Maynard said.Maynard explained that truckers are awaiting a ruling by the National

Labor Relations Board on whether or not two driv-ers, who were reportedly fired by Green Fleet Sys-tems before this summer’s strikes for participating inunion activities, will be reinstated. She added that morethan 30 drivers have been fired by TTSI since the cool-down period was ordered in retaliation for filing wage claimsagainst the company.Cherin, however maintained, that no one was fired by TTSI. “[TTSI] transitioned from an asset-heavy company to an asset-

light company and as a result of that had to rewrite their inde-pendent contractor agreements. Some drivers chose to re-up withthe company and sign those new agreements. Some chose not to.Nobody was fired,” Cherin said.While breakdowns in contract negotiations and picket lines have

the potential to cause economic ripples throughout the distributionchain, the way a company responds to these threats, whether per-ceived or real, can also have effects. O’Connell cited a move by largeretailers last spring to boost imports for the fall season in anticipationof a potential breakdown in ILWU contract talks.“We began in the spring to see unprecedentedly large surges of

goods coming into the U.S.,” O’Connell said. “Largely in anticipationof disruption.”This move has likely cost retailers money, O’Connell said, because

companies would have to spend extra money warehousing holidayitems such as Halloween costumes and Christmas decorations. Storesthat decided to put these items out early would have to clear shelf spacefor the out-of-season items. O’Connell said it was the companies thatbet on a strike not happening that probably came out ahead.“They didn’t burden themselves with the additional warehousing and

all the financial charges that go with hanging onto merchandise, thatyou’re not going to make any money from for another two or threemonths,” O’Connell said. With the peak shipping season now over, O’Connell said he thinks it

unlikely there will be any serious disruption in the movement of goodsthis holiday season. “Certainly nothing that’s going to keep Santa from making his ap-

pointed rounds in December,” O’Connell joked. �

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METRANSLooks For Most

Efficient Ways To Distribute,Warehouse And Move Goods

� By GENEVIEVE GIULIANO

T he importance of international trade to the Long Beachcommunity makes it critical to keep industry at the fore-

front of innovation. In order to retain competitiveness in the con-stantly changing world of trade, local businesses must not onlyconstantly operate “better, faster, cheaper,” but also respond to com-munity desires for a cleaner environment. Achieving these dual ob-jectives requires continuous innovation. Universities have two main jobs: educating the next generation

workforce and developing innovations in technology, policy and prac-tices that provide solutions for current and future problems throughbasic and applied research. The METRANS Transportation Centerspecializes in freight research, and addresses many of the topics dis-cussed in this special section. METRANS is a partnership of USCand CSULB, and was established in 1998. Its mission is to solvemetropolitan transportation problems through research, educationand outreach. This article highlights some of METRANS’ research.

Distribution and warehousing: Not only are warehousing anddistribution practices changing, the location of warehousing and dis-tribution activity is also changing. Technology developments – au-tomation and information technology – have made large-scaleoperations cheaper and more efficient, generating demand forspace in low land-price areas of the region. Many observers ques-tion whether the efficiencies realized within the supply chain areoffset by longer truck trips, since these facilities are more distantfrom population and employment centers. Longer truck tripstranslate to more road congestion and pollution. However, in a re-gion like Los Angeles, it is also possible that these relocations donot generate longer truck trips, because so much warehouse anddistribution center (W/DC) activity is export-oriented. ME-TRANS researchers are examining trends in W/DC locations infour California metropolitan areas to determine whether W/DClocation trends are consistent across metro areas and, if so,what the net impact on truck travel is. It is important to under-stand the full effects of these location changes so that conges-tion and pollution problems can be effectively addressed.

Energy and goods movement: Energy – in the form of de-clining real prices of fuel over several decades – has been oneof the major facilitators of globalization and complex interna-tional supply chains. Efforts to reduce greenhouse gas (GHG)emissions and uncertainties regarding price and availability ofalternative fuels will surely affect Southern California and inter-national trade more generally. California’s AB 32 brings thetransport sector into cap and trade in 2015, and coastal areassubject to low sulfur fuel requirements are growing. The San Pedro Bay ports have been at the forefront of efforts

to reduce particulate emissions and in doing so have also im-proved energy efficiency. METRANS researchers have studiedmany of the policies implemented by the ports, including Pier-Pass, appointment systems, the Vessel Speed Reduction pro-gram, the Clean Air Action Plan and, most recently, some of the

technology experiments conducted under the Technology ImprovementProgram. This research not only provides an independent assessment ofwhat works and what doesn’t, but helps us to understand how to buildthe collaboration necessary for effective programs and how to most ef-fectively achieve air pollution and energy goals.

A more efficient goods movement system: METRANS sees effi-ciency improvements as the most effective short-term strategy for re-ducing energy consumption and GHG emissions. Efficiencyimprovements reduce costs and increase competitiveness. Researchersare developing scheduling models to better utilize the capacity onSouthern California’s rail system. With better scheduling, more andlonger trains can be accommodated, and conflicts between freight andpassenger trains can be reduced. With faster service, more freight trafficmay be carried by rail. Researchers have developed models to reducedrayage truck travel by repositioning empty containers and chassis.These models show that substantial efficiency gains are possible. METRANS analyzed the potential gains from load consolidation in

the California flower industry. Research showed that load consolidationcould improve competitiveness in the national flower market, and as aresult industry representatives obtained a federal grant to build a con-solidation center. Providing such information is an incentive for the in-dustry to collaborate to realize these efficiencies. However, there areoften many obstacles that prevent these efficiencies from being ex-ploited. Our research not only develops technical solutions but also ad-dresses how changes in chassis or empty container management couldactually be implemented. Not all efficiency improvements come from within industry; the pub-

lic sector has a role to play as well. METRANS researchers are examin-ing how better traffic management could improve truck flows. Forexample, in areas where there is substantial truck traffic, would it bemore efficient to favor trucks at traffic signals? Trucks use most oftheir fuel accelerating and slowing down; traveling at a constant speedwould reduce both emissions and fuel consumption. Another example isbetter real-time traffic information. Researchers are working on meth-ods to predict the impacts of accidents on traffic in near real time sothat travelers would know the length of the backup and its anticipatedduration, allowing them to avoid these delays.

Looking to the future: Universities play a special role: they conductlong-term research, research that takes years or decades before there is aproduct. Long-term research is a tough sell, because the payoff time islong and the risks of failure are high. However, long-term research isthe basis for innovation; without it, today’s technology developmentswould not exist. METRANS is also engaged in long-term research. Automated vehicle

technology is developing rapidly. METRANS is exploring the conceptof truck platoons: several trucks traveling as a “train,” guided by vehi-cle-to-vehicle communications systems. There are many questions: howsuch communications would work, how accelerating and slowing downwould work, how far apart the trucks should be, how to manage entryand exit from the platoon, and how such platoons would affect highwayperformance. It will take many years to answer these questions andmake automation a reality. METRANS is also examining the concept of integrated corridor man-

agement: how might we manage all modes (cars, trucks, public transit)across all facilities (freeways, streets, rail transit lines) to optimize flowfor the entire corridor? Integrated corridor management (ICM) requirescoordination of ramp metering, traffic signals and transit service opera-tions in real time. It also requires being able to predict how travelers willrespond to changes in signals or ramp meters or transit fares. Researchersuse complex mathematical models to determine how ICM might work,and then test their results in simulation studies. Eventually this researchwill lead to better performance of our transportation system. Universities play a critical role in supporting the innovation process.

METRANS researchers are working to promote a more efficient andsustainable freight system in Southern California, both today and in thecoming decades.

(Genevieve Giuliano is the Ferraro Chair in Effective Local Gov-ernment and rofessor and senior associate dean of Research andTechnology at the Price School of Public Policy at University ofSouthern California (USC), and the director of the METRANS Trans-portation Center. Dr. Giuliano's current research includes analysis ofgrowth and development of employment centers, examination of howports and supply chains respond to environmental regulation, and de-velopment of planning and management applications using real-timetransportation systems data. She was recently appointed to the Na-tional Freight Advisory Committee.) �

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October 14-27, 2014 Section A

Documents

Transcript of October 14-27, 2014 Section A