July 7-20, 2015

Small business is big business.

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CompeteSmall business is big business. Small businesses employ more than 7.2 million Californians, keeping big businesses on their toes. To get the most competitive bids, the Port of Long Beach utilizes small businesses for nearly 26% of its contracts. Small business is making a big di�erence.

www.POLB.com

July 7-20, 2015 www.lbbusinessjournal.com

SPECIAL REPORT – MID-YEAR ECONOMIC OUTLOOK

Job Creation Begets Positive Outlook DespiteFirst Quarter Lag In GDP

Harbor Commission President DrummondReflects On The Port’s Achievements,Challenges And Competitive Edge

� By SAMANTHA MEHLINGER

Senior Writer

Doug Drummond’s career inpublic service spans more

than 45 years, during which timehe spent 29 years with the LongBeach Police Department, eightyears on the Long Beach CityCouncil, one year on the LongBeach Transit Board of Directors,and most recently, four years onthe Long Beach Board of HarborCommissioners, where he cur-rently serves as president. In all

that time, what he has found mostrewarding is his role overseeingthe Port of Long Beach as a harborcommissioner. “It’s really exciting,” Drum-

mond said of his role at the Port ofLong Beach, for which he is one offive commissioners making policydecisions on the port and its future.“It’s fun to be part of somethingwhere you are focused and you arebuilding and making jobs.”The other commissioners are:

Rich Dines, vice president, a long-shoreman at the ports of Long

Beach and Los Angeles; Lori AnnFarrell Harrison, director of fi-nance for the City of HuntingtonBeach; Lou Anne Bynum, exe-

A retired police commander and former two-term city councilmember, Doug Drummond was appointed to the Long BeachBoard of Harbor Commissioners by former Mayor Bob Foster in 2011. He has served as president of the five-member com-mission for the past year. (Photograph by the Business Journal’s Evan Patrick Kelly)


Senior Writer

W hile economists had toadjust their expectations

for U.S. gross domestic product(GDP) growth this year due to acontraction in the first quarter, theoutlook for the remainder of theyear is promising, as steady jobcreation is expected to generatepositive ripple effects throughoutthe economy. Some uncertaintiesto this outlook remain – namely anexpected increase in interest ratesand cautious spending on the partof consumers, according to na-tional and regional economists.“The economy seems to be per-

forming very well, notwithstandingthe first quarter which was slightlynegative in terms of GDP growth,but that was due to a few anom-alies,” Steven Cochrane, managing

director with Moody’s Analyticswho oversees U.S. regional fore-casting, told the Business Journal.United States GDP decreased at anannual rate of 0.2 percent in thefirst quarter, ac-cording to a Junereport from the U.S.Bureau of Eco-nomic Analysis. The anomalies

that caused the GDP to falter weresevere weather in the East andMidwest, and congestion at So Calports, Cochrane said. “These areone-time things that shouldn’t beread too much into the overall per-formance of the economy,” he em-phasized. At the start of the year,Cochrane had expected U.S. GDPto increase by 3.5 percent this year,but has since adjusted his expecta-tion to about 3 percent growth.


Senior Writer

J ohn Bishop, former chieffinancial officer for

MemorialCare Health System’sthree Long Beach hospitals, waspromoted to the position of chiefexecutive officer and assumedduties on June 22. Bishop re-placed Diana Hendel, who re-signed earlier this year after sixyears as CEO of Long BeachMemorial Medical Center, Com-munity Hospital Long Beach andMiller Children’s & Women’sHospital Long Beach.Bishop, a longtime Long

Beach resident, had served asCFO for MemorialCare’s LongBeach hospitals since 2009. Priorto that, he served as CFO forSaddleback Memorial MedicalCenter. He has also been theCFO of MemorialCare’s SeasideHealth Plan since 2014.“We selected an outstanding

individual with a demonstratedtrack record of success withinMemorialCare as the new leaderfor our Long Beach hospitals,”Barry Arbuckle, Ph.D., presidentand CEO of MemorialCare

Health System, said in a pre-pared statement. “John is a strategic, engaged

and innovative leader with exten-sive experience in executivemanagement and finance,” Ar-buckle continued. “That breadthof knowledge combined withJohn’s leadership in all aspects ofhealth care delivery – from inpa-tient, outpatient and ambulatorysettings to physician groups,health plans and community-based care – makes him the per-fect choice to lead our LongBeach hospital s and programs.”Bishop told the Business Jour-

John Bishop Selected As The New CEO Of MemorialCare’s Three Long Beach Hospitals

(Please Continue To Page 13)

Long Beach DevelopmnetProjects Underway Or PlannedSee Page 31

(Please Continue To Page 15)(Please Continue To Page 40)

John Bishop was recently appointed CEOof Long Beach Memorial Medical Center,Miller Children’s & Women’s HospitalLong Beach and Community HospitalLong Beach. (Photograph by the BusinessJournal’s Evan Patrick Kelly)

Airport Tenants Say City NeedsStrategic Plan For General AviationOr Business May Decline Further

� By SEAN BELKStaff Writer

I f Long Beach Airport doesn’tdevelop a long-term strategic

plan for general aviation, the in-dustry may fall deeper into declineand some businesses may relocateor close all together, airport ten-ants said in a recent interview withthe Business Journal. Fixed-base operators (FBOs)

that support general aviation –which includes corporate jets and

all aviation other than commer-cial airlines and the military –said the airport takes a hands-offapproach to marketing, lacks anystrategic business plan and hasturned to solely focusing on com-mercial airlines. As a result, investors are having

a hard time justifying whetherthey should dump more moneyinto facilities at an airport that ten-ants say doesn’t value general avi-ation business as a resource eventhough the industry supports thou-sands of jobs and is a major assetto the local economy.“The amount of business [at

Long Beach Airport] has steadilydeclined over the years, and the pieis getting smaller,” said John Tary,general manager of Toyota AirFlite,a 14-acre facility and subsidiary ofToyota Motor Sales USA, Inc. thatservices jets for Toyota’s corporateexecutives from Japan as well asother corporate aircraft. Tary said Toyota is now in a

Jim Michaelian, president and CEOof the Grand Prix Association of LongBeach could not be happier. To findout way, see Page 12

Painting The Town: POW! POW! Long Beach

See Pages 36 & 37(Please Continue To Page 8)

1_LBBJ_July7_2015_PortAnniversary 7/4/15 5:50 PM Page 1

Inside This Issue4 Inside City Hall

• What Are Private Public Partnerships And Why The Long Beach Courthouse Costs So Much More. Pt. IIBy Former Councilmember Gerrie Schipske

6 Going Green• Commercial Organic Waste Requirements

8 Newswatch• Airport Tenants, continued From Page 1

• U.S. Customs Facility Study On July 7 Agenda

• Midtown Property Owners Voting On Forming BID

• Long Beach Water Use At Record Low

• Long Beach Grand Prix Among The 10 Best Races

• New Memorial CEO, continued From Page 1

• Port Of Long Beach Releases Narrative History Book

• Budget Increase For Gerald Desmond Bridge Project

• Port Of Long Beach Top Seaport In North America

15 Special Report: Mid-Year Economic Outlook• Corporate Aviation Major Boon For Local Economy

• Financial Services: Roadblocks To Retirement

• The Invisible Infrastructure: Utilities That You Count On

• Getting At Oil Using New Technologies

• The Projected Primary Care Physician Shortage

• Ports Working Together To Ensure Future Growth

• How Local Retailers Are Drawing Customers

• Development Projects Underway Or Planned

• Update On Douglas Park

34 Perspective

36 POW! POW! Long Beach

38 Art MattersPresented By The Arts Council For Long Beach

39 The Nonprofit PagePresented By The Long Beach Nonprofit Partnership

Free: Long Beach Business Journal Digital Edition, Monday Morning Coffee, NewsFlashSign up at: www.lbbusinessjournal.com • Follow us on Twitter: @LBBizJourn

2 Long Beach Business Journal July 7-20, 2015




What Are PrivatePublic PartnershipsAnd Why The L.B.

Courthouse Costs SoMuch More – Part II

Defenders of “private-public partnerships” will tellyou in a heartbeat that Long Beach should jump at thechance to encumber debt for 50 years in order to builda new City Hall and Library what will be the lynch-pinfor a “Century City” type downtown.After all, just look across the street at the new court-

house. It’s a “three P” or “PBI” performance-based in-frastructure (to use the jargon). In fact, the courthouseis the only government building in the United States tobe financed in this manner. Public-Private-Partnerships (common in other coun-

tries) work with a private developer making the equityinvestment from usually international funds and pen-sions. The developer finances, designs, builds and main-

tains the facility and the government makes paymentson a lease basis for 30 to 50 years. At the end of thelease, the building belongs to the government. So what’s wrong with that? Nothing, if it costs the tax-

payer less to do it as a PBI than it would if the projectwas funded by the city and built by a developer who didnot own the building when it was completed. To date,we don’t know if that would be the case for a new cityhall because that data has not been released to the pub-lic. Yet, without disclosing the cost, Long Beach has al-ready lobbied the legislature to get a change in the lawwhich would allow the city to pay for the civic centerproject over 50 years. The project is estimated to cost$358 million but if leased over 50 years it could soar to$630 million.Before the courthouse project even got the green light,

there was an analysis of the “Value for Money” (VFM)

of the project. VFM is a comparison of the risk-adjustedwhole life-cycle cost of the project procured as a PBIcompared with the risk-adjusted whole life-cycle costof the project as if it was procured in the more tradi-tional manner. The goal was to determine which wouldprovide the best value to the state.However, even with a VFM that indicated a PBI would

provide the “best value to the state,” the project appearsto be costing the state taxpayers a lot more than theanalysis showed. The California Legislative Analyst Of-fice notes in its review of the courthouse project: “thatutilizing a different set of assumptions than those (in theoriginal VFM) (such as excluding the assumed federaltax adjustment and leasing costs) would result in thecost of the Long Beach courthouse project being less –by as much as $160 million in net present value terms –in the long run under a traditional procurement approachthan the chosen P3 approach.”Given those facts and the fact that on other P3 proj-

ects, private companies will often seek to earn a profitof roughly 10 percent to 25 percent when loaning fundsto a government, how can anyone justify this to the LongBeach taxpayer?Before city hall officials move any further on com-

mitting taxpayers to paying for a new city hall and li-brary – that could instead be retrofitted and repurposed– they need to produce a public VFM that discusses thefull costs of this project and then, perhaps, put the issueon the ballot in 2016. Let the voters/taxpayers decide ifthey want to make private developer very wealthy.Next column: Some Politicians Are So Transparent(Gerrie Schipske is a native of Long Beach, an attor-

ney, registered nurse practitioner and full time instructorat CSULB Department of Health Care Administration.She was elected to both the Long Beach Community Col-lege Board of Trustees and the Long Beach City Council.She is the author of several books on Long Beach historyand her blog, www.longbeachinside.blogspot.com.) �

INSIDE CITY HALL

� By GERRIE SCHIPSKEContributing Writer




Senior Writer

Beginning April 1, 2016, businesses,public entities and multi-family complexeswith five units or more, generating eight ormore cubic yards of organic waste, will berequired by California law to recycle thatwaste. Signed into law in 2014, AssemblyBill (AB) 1826 includes a tiered implemen-tation schedule, requiring entities generat-ing lesser amounts of waste to beginorganics recycling in 2017, 2019 and 2020,depending on their waste load.California's Department of Resources

Recycling and Recovery, known as CalRe-cycle, hopes the law will help it meet itsgoal of recycling 75 percent of all wastegenerated in the state by 2020. Removingorganic waste from landfills through recy-cling cuts down on greenhouse gases, ac-cording to CalRecycle.Under the mandate, organic waste from

food, landscaping and pruning, nonhaz-ardous wood and food-soiled paper must berecycled. To comply, businesses may part-ner with a waste service provider for col-lection and recycling, recycle the materialonsite, self-haul the materials to other lo-cations for recycling, or sell or donate anyorganic waste they generate. Typically, or-ganic waste is recycled into compost foruse in soil or is put through anaerobic di-gesters to generate energy. “For local jurisdictions like the City of

Long Beach, their requirement is to de-velop and have a program in place that willmeet the needs of businesses to help themdivert the materials,” Cara Morgan, localassistance and market development branchchief for CalRecycle, told the BusinessJournal in an interview that also included

Long Beach Environmental Services Bu-reau Director Jim Kuhl.All California jurisdictions are required

to have organic recycling options for busi-nesses and multi-family complexes by Jan-uary 1, 2016. According to Morgan, somejurisdictions may create their own ordi-

nances with enforcement procedures.“Some jurisdictions are going to be readyto implement programs January 1, and oth-ers may need more time,” Morgan said,adding that the law allows for some leewayfor those areas requiring more time.CalRecycle’s role is to measure compli-

6 Long Beach Business Journal July 7-20, 2015GOING GREEN

CalRecycle, City Of Long Beach And Businesses Prepare For New Commercial Organic Waste Recycling Requirements

The Long Beach Environmental Services Bureau is currently working with CalRecycle and local businesses to develop a program to comply with new commercialorganic waste recycling mandates. Pictured from left are: Jim Kuhl, director of the Long Beach Environmental Services Bureau; Jennifer Wallin, supervisor,materials management and local assistance for the Southern Section of CalRecycle; and Cara Morgan, local assistance and market development branchchief for CalRecycle. (Photograph by the Business Journal’s Evan Patrick Kelly)


ance with AB 1826 on a statewide scale,based on baseline figures from 2014, Mor-gan said. “Another role that CalRecycleplays is reaching out to statewide associa-tions, so working with the CaliforniaChamber of Commerce and other businessassociations, manufacturer associations[and] retailers, to get out information to thebusinesses,” she continued. “Our other roleis helping the local jurisdictions.”The main role of jurisdictions, such as

the City of Long Beach, will be to “educatebusinesses on how they can recycle in theircommunity and then to monitor businessesto identify those that may not be recyclingorganics, and then to reach out to them insome way,” Morgan said.The City of Long Beach hasn’t finished

designing its organic waste recycling pro-gram to ensure compliance with AB 1826,Kuhl said. “The big part of it is trying todetermine who falls under the first tier ofthe regulatory process,” he said, referringto generators of eight or more cubic yardsof organic waste. CalRecycle is currentlyundertaking a statewide waste characteri-zation data study to determine who thosewaste generators are, Morgan said.Initial findings suggest the majority of

businesses affected by the April 2016 im-plementation date are large supermarkets,food packing warehouses and large-scalefood manufacturers, according to Morgan.“Grocery stores are probably the largestgenerator, many of which already havetheir own programs to backhaul food wasteto their facilities and compost it,” Kuhlsaid. “We may find in the first year that

most of those are already in compliance.”Other large producers of organic waste

may include hospitals, universities, hotelsand school districts, Kuhl said. Morgan sus-pected these would fall under the January 1,2017 compliance date. Smaller generatorsof organic waste largely include restaurants.“We are going to go through [the] business

licensing [department] to determine who thelargest employers are who fall into these cat-egories,” Kuhl said. “And then we will startthe outreach through there, possibly evengoing through the chamber of commerce.”Part of the reason it may be difficult for

some jurisdictions to fully comply with AB1826 is there is a lack of organics recyclingfacilities. “What Southern California ismissing are the facilities to compost orprocess this material,” Kuhl said. “Thereare very limited opportunities right now.”Kuhl said he hoped the state governmentwould encourage companies to invest incomposting facilities or anaerobic digestersto alleviate this problem.“We have allocated funding to imple-

ment a greenhouse gas reduction grantand loan program to provide funding forthat infrastructure,” Morgan said. “That isa big part of the governor’s budget. It ismoney that comes from AB 32’s green-house gas reduction funds.”Some companies have already devel-

oped their own organics recycling facili-ties. The Kroger Co., which owns andoperates 300 Ralphs and Food 4 Lessstores in Southern California with fiveRalphs and three Food 4 Less locations inLong Beach, is one such company.

Kroger invested in anaerobic digestingtechnology at its 49-acre Compton facility,where it hauls 150 tons of organic wastefrom Southern California locations everyday, according to Kendra Doyel, vice pres-ident of media relations for Ralphs Group.The Compton location includes corporateoffices, distribution and warehousing cen-ters and a creamery manufacturing plant. Prior to building the anaerobic digester

facility, which has been fully operationalfor about two years, the company hauled itsorganic waste by truck to Northern Califor-nia. “We are reducing truck trips by morethan 500,000 miles per year,” Doyel said.At the facility, organic waste is put into

a mulching device, which breaks the mate-rial down, Doyel said. After any nonorganicmaterials are filtered out, the organic wasteis combined with effluent material gener-ated by the site’s creamery and is placed ina “large bin of microbes,” which “then takethe organic material through an anaerobicdigestion process.”Through this process, enough energy is

generated and captured to power 20 per-cent of the entire 49-acre facility’s energyneeds, Doyel said. “When you look at theenergy needs that we are taking off thegrid, that is about enough energy to power8,000 homes per year,” she said.The facility may be the first of its kind

to be built in a densely populated urbanarea, Doyel said. “This model is one that Iencourage other businesses to take a lookat, and I am encouraging other cities to takea look at, because it really is a very power-ful solution to the huge problem that is foodwaste in our state.” �

July 7-20, 2015 Long Beach Business Journal 7GOING GREEN


“decision process” about what to do withits FBO facility, adding that the “currentenvironment” has made it difficult for himto argue the viability of the FBO that hascalled the airport home since Toyota pur-chased the facility in 1989. Last year, in a survey by Aviation Inter-

national News that included 12,000 evalu-ations from 91 countries, Toyota AirFlite’sLong Beach facility was recognized as thebest FBO for the Americas. Relocating itsfacilities out of Long Beach could easily re-sult in a black eye for the city amongst theaviation community.“Obviously, I can say we’ve been a pretty

good tenant,” he said. “But, it’s one of thosethings that may come to an end given thecurrent policies.”Tary is not alone in his concerns about

the future of general aviation at LongBeach Airport.JFI Jets, an FBO company based in Long

Beach, that has operations in New York andNashville and that provides private jet char-ter services and aircraft management, is ex-panding its fleet in the Southeast instead ofLong Beach, where the company is head-quartered and employs about 50 people, ac-cording to Sohail Ashraf, chief financialofficer for JFI Jets. “We would love to be here,” he said. “We

want to be here . . . But, at some point, ifyou were to ask me if I were to invest moremoney? I don’t see that. I have investedback in 2006 and 2005. [For] additional

money, I have to see some type of a returnin order for me to expand.”Several FBO managers said “too much

capacity” at the airport – meaning too manytenants fighting over the same gallons offuel – is what’s creating an “un-level playingfield” for general aviation businesses. Curt Castagna, chief operating officer of

Aeroplex/Aerolease Group, which leaseshangar space and provides support servicesfor private airplanes, said that, while com-petition is good, “unhealthy” competitiononly keeps business stagnant.He added that the airport should open up

dialogue with airport tenants and FBOs tocreate a strategic business plan to ensurethe value of the airport is “healthy.” Other-wise, general aviation business will con-tinue to fall, creating less revenue for FBOsand the airport, Castagna said. “The downside of allowing all that com-

petition is that, if no one can survive, theneveryone’s going to suffer,” he said. “Andthe value of the underlying land to what thecity will charge you is going to go down.It’s going to decline. As opposed to, if thebusinesses were doing better, the value ofthe land would be doing better.”Castagna added that several general avi-

ation businesses have either filed bank-ruptcy or left the airport in the last decade,noting that Cessna Aircraft Company in2007 relocated its citation service centerfrom Long Beach to Arizona, where it ex-panded. A major point that FBOs raised is the

fact that the airport lacks a federal inspec-tion service (FIS) facility for U.S. Customsand Border Protection, an issue that will be

discussed tonight, July 7, at the LongBeach City Council meeting. While JetBlue Airways has been the

main driver behind the city’s decision toconsider adding international flights, FBOshave also been calling for a U.S. Customsfacility, which airport officials have saidwould take three-plus years to establish.FBO managers pointed out that not al-

lowing international flights at Long BeachAirport actually creates more noise andsafety hazards, since corporate jets comingfrom other countries currently have to stopat either Hawaii or LAX first to go throughU.S. Customs and then fly to Long Beach,creating the need for additional flights. Tary said, in many cases, because of

safety risks, Toyota executives don’t eventake the extra flight and instead drive totheir location, leaving their FBO facilityidle and providing tax revenue to Los An-geles rather than Long Beach. “We just don’t want to add that risk to it,

so we actually just leave the airplanes inL.A.,” he said. “So, our own company, ourown base, our own facility, we can’t evenuse. Really, we’re not buying fuel here.We’re not paying taxes here. We’re nowshifting it to somewhere else.” Castagna said Long Beach residents’

concerns that adding international flightsand a U.S. Customs facility would compro-mise the airport’s noise ordinance are un-warranted, adding that currently generalaviation at Long Beach is only at 50 per-cent capacity of what is allowed under thenoise ordinance. He noted that Van Nuys Airport, one of

the world’s busiest general aviation air-

ports, opened a U.S. Customs facility forinternational flights this year. Castagna said general aviation busi-

nesses should be allowed to maximize theiropportunities for growth while stayingwithin the confines of the noise ordinance. “We need to evolve, but that doesn’t

mean we need to be noisier,” he said. “Thatdoesn’t mean we need to grow outside ofthe rules that we already agreed to. That’sthe challenge.” �

City Council To Consider FeasibilityStudy About Adding

U.S. Customs At Airport


At tonight’s (July 7) meeting, city coun-cilmembers will decide on whether to con-duct a feasibility study on allowinginternational flights at the Long BeachAirport, and establishing a federal inspec-tion service (FIS) facility for U.S. Cus-toms and Border Protection. The agendaitem is a request filed by Airport DirectorBryant FrancisThe possibility of a feasibility study on

a U.S. Customs facility comes nearly oneyear after JetBlue executives announced in-terest in requesting that the city consideradding international flights at the airport aspart of the airline’s business model. JetBlue, which is the airport’s primary air


Airport Tenants: NeedFor A Strategic Plan(Continued From Page 1)

NEWSWATCH


carrier, made its request formal in a letterto the city in February of this year. Francispreviously indicated that establishing a U.S.Customs facility could be a process thattakes three-plus years. The city would be required to apply to

the United States Department of HomelandSecurity, Customs and Border Protectionfor a “user fee” airport designation andseek approval to establish an FIS facility,according to a city staff report. A move by the city council to perform a

feasibility study on the issue was put onhold in March in order to wait until a 4thDistrict councilmember was elected. Thatnew councilmember, Daryl Supernaw, wassworn in more than two months ago. Some Long Beach residents have op-

posed the proposal, stating that it would in-vite more flights. Others, however, say aU.S. Customs facility would bring majorbenefits, including more airport revenueand international tourism while also bene-fiting fixed-base operators.The Business Journal has long supported

a customs facility, or at a minimum explor-ing the feasibility of such a facility.“Too many people are intentionally

being misled to confuse improved serviceswith more flights,” Business Journal Pub-lisher George Economides said. “The air-port ordinance is airtight and no one –including JetBlue – is looking to alter theordinance in any way.“If the city does not move forward with

a study,” he continued, “I firmly believe theFeds will step in and say the city is notbeing reasonable. Then, local control is lostand no one is happy.” �

Task Force Formed ToExamining Developing

Queen Mary Area� By SEAN BELKStaff Writer

Long Beach Mayor Robert Garcia is ap - pointing 12 individuals to serve on a new taskforce expected to provide feedback on pro-posals for approximately 43.38 acres of de-velopable land surrounding the Queen Mary. The city council approved forming the

Queen Mary Land Development TaskForce at the request of Mayor Garcia andVice Mayor Suja Lowenthal, who bothhave been in negotiations with the ship’soperator, Garrison Investments. Garcia said the task force is being

formed since the ship’s operator has re-cently been in “intense conversations” withthe city and is ready to move forward withdevelopment. “It’s time to put together acommunity group to really advise develop-ment, service and management,” he said. The advisory task force will include

downtown residents as well as experts intourism and hospitality, design and archi-tecture and historic preservation. At the re-quest of other councilmembers, Garciaagreed to also consider individuals through-out the city with a variety of talents, sincethe ship is considered a citywide resource.The developable acres that surround the

Queen Mary include the Queen MaryEvents Park, parking lots and Sea Walk Vil-lage, as well as other vacant land. �

July 7-20, 2015 Long Beach Business Journal 9NEWSWATCH



Midtown PropertyOwners To Take FinalVote On Forming New Business

Improvement District


Property owners along a stretch of EastAnaheim Street between Raymond andAlamitos avenues that encompasses Cam-bodia Town have one last chance to voicetheir opinions about assessing themselvesto form a new business improvement dis-trict (BID).The assessments would allow for serv-

ices beyond those provided by the city, in-cluding public safety, beautification,marketing and economic development pro-grams, according to a city staff report.The city, through a consultant, recently

mailed ballots to property owners – approx-imately 52 of them, including the ownerwith the most properties, the city – regard-ing whether the city should establish theMidtown BID. The ballot mailing occurred after first

petitioning those owners on whether theywished to move forward. Petitions were re-turned by 28, or nearly 55 percent of theowners, indicating they did. The city ac-counted for 13 of those 28 properties.Property owners have until August 11 to

return the ballots. If a majority of the re-turned ballots approve the formation of aBID, an advisory board will then be ap-pointed. Ballot results will be released dur-ing a public hearing before the city councilon August 11.The proposed BID corridor, which

crosses City Council Districts 4 and 6,would be adjacent to the East AnaheimStreet Business Improvement District onthe east and would include a diverse row ofmostly small businesses, including super-markets, restaurants and cafes in CentralLong Beach. As previously reported, property assess-

ment fees for the Midtown BID are esti-mated to total $161,501 annually with anadditional $5,952 from other revenues.Assessment revenues would cover costs as-sociated with a safe team program thatwould provide security services in the formof bicycle and walking patrols, a clean and

beautiful program, sidewalk cleaning, graf-fiti removal, landscape maintenance, mar-keting and BID management. According to the plan, properties owned

by the City of Long Beach, including for-mer redevelopment properties, representthe largest parcels in the district and 40percent of the total assessment. In otherwords, the City of Long Beach will bepaying $65,700 of the annual assessment.City-owned properties include the LongBeach Transit facility, MacArthur Parkand the Mark Twain Library.If established, the new BID would go

into effect on January 1, 2016. The citycouncil will annually review and considerapproving renewal of the levy, budgets andreports as submitted by the Midtown BID,according to city staff. Upon annual review,the city council may increase the levy up to4 percent. �

Long Beach Water UseAt Record Low; BeatsGovernor’s Mandate


Senior Writer

Long Beach residents and businesses arehelping the city to go above and beyondGov. Jerry Brown’s water conservationmandate. The governor’s mandate requiredLong Beach to cut back on water use by 16percent; in June, Long Beach exceeded thatrequirement by reducing water use an addi-tional three percent, according to the LongBeach Water Department. The city’s Junewater use of 4,380 acre-feet of water wasthe lowest amount for the city since 1956.“Long Beach is off to an incredible start

to meet the state’s cutbacks,” Mayor RobertGarcia said in a statement from the waterdepartment. “I’m very proud of the effortby our residents, businesses, schools andvery own water department. We continueto lead statewide.”Harry Saltzgaver, president of the Long

Beach Board of Water Commissioners,emphasized the importance of the citystaying on track with its water conserva-tion efforts. “We have to continue con-serving and permanently change the waywe use water,” he stated.On July 18, the water department is

launching a water conservation campaigncalled Mission H2O LB. Visit www.mis-sionh2olb.com for more information. �

July 7-20, 2015 Long Beach Business Journal 11


� By GEORGE ECONOMIDES

Publisher

Readers of USA Today have confirmedwhat the Southern California racing com-munity has known for decades: The ToyotaGrand Prix of Long Beach is among thebest motorsports events in the world. Infact, it’s among the Top 10, right alongsidethe Baja 1000 and the Indy 500.A recent online poll by USA Today – the

newspaper with the third largest paid cir-culation in the country after the Wall Street

Journal and New York Times – resulted in12,000 responses and a list of the top 20motorsports events. Those 20 events werethen reviewed by a panel of what the news-paper called “motorsports gurus” to de-velop a Top 10 list.Long Beach made it; Monaco did not!“It is extremely gratifying to know that

motorsports fans around the world see ourevent as one of the best in the world,” saidJim Michaelian, president and CEO of theGrand Prix Association of Long Beach,pictured at right. “Our thanks to them for

voting for us in the poll,and we look forward toonce again delivering aworld-class event for the42nd time next April.”Following is what the

newspaper refers to as USATODAY 10Best:1. Baja 1000, which travelsfrom one end of the Califor-nia peninsula to the other. 2. Indianapolis 5003. Isle of Man Tourist Trophy(motorcycle race)4. Night Race at Bristol(Tennessee)5. Chili Bowl Nationals(Tulsa)6. Rally Finland7. 12 Hours of Sebring (Florida)

8. Singapore Grand Prix9. Grand Prix of Long Beach10. Pikes Peak International Hill Climb. �


Long Beach Grand Prix Race Is Among The Best Of The Best – But You Already Knew That

Dr. Felton Williams IsChair Elect Of CouncilOf Great City SchoolsDr. Felton Williams, president of the

Long Beach Unified School District’s(LBUSD) Board of Education, wasnamed chair-elect of the Council of GreatCity Schools’ Board of Directors earlierthis month. The council has a 134-member board

with the superintendent and one board-member from each of the council’s 67

urban public school districts. The organiza-tion’s mission is “to promote the cause ofurban schools and to advocate for inner-citystudents through legislation, research andmedia relations,” according to its website.

– Samantha Mehlinger

Police Foundation Receives $10,000 Donations From UPSAnd Fueling California


The Long Beach Police Foundation(LBPF) recently received two $10,000 dona-tions, one from UPS and another from Fuel-ing California, to support fundraising effortsfor the Long Beach Police Department, ac-cording to announcements from the LBPF. “With the economic troubles facing our

state and local governments, it is importantthat organizations like Fueling California,as well as private corporations, lend theirsupport to help vital public services likepublic safety,” said Austin Lee, executivedirector of the nonprofit Fueling California. Bruce Mac Rae, chairman of the LBPF

Board of Directors, said in a statement that

NEWSWATCH

Dr. Felton Williams visits with President BarackObama following a meeting with the Council ofGreat City Schools at the White House in March.(Photograph provided by LBUSD)


the foundations is committed to building asafer community through donations that en-hance the Long Beach Police Department’sability to perform at the highest level. “These funds will contribute to making

the community safer by assisting with thelatest equipment, training and technologyto stay on the leading edge of policing,”Mac Rae said. “LBFD is dedicated to sup-porting our men and women at the LongBeach Police Department. Contributionsand funding also subsidize community out-reach programs supported by the LongBeach Police Department.”For more information about making a

donation to the LBPF, visit www.lbpolice-foundation.org or call (562) 343-5111.

Port Of Los AngelesCo-publishes BookChronicling TerminalIsland’s Bygone Era


Senior Writer

On June 16, the Port of Los Angeles(POLA) and Angel City Press released a

historical book, “Terminal Island: LostCommunities of Los Angeles Harbor,”about communities that used to exist onTerminal Island, which is now home toPOLA and Port of Long Beach operationsas well as a federal prison. The book chronicles the lives of early oc-

cupants of the island who arrived in themid-1800s, and subsequent communities ofJapanese American immigrants who wereforced to leave the island following the at-tack on Pearl Harbor in 1941. The book was penned by Naomi Hirahara,

an author and journalist, and Dr. GeraldineKnatz, former POLA executive director. Itfeatures hundreds of photographs and im-ages. The book is available to purchase at sev-eral locations, including the Los AngelesMaritime Museum, San Pedro Bay HistoricalSociety, Point Fermin Lighthouse, and theJapanese-American Museum. It is also avail-

able through the Los Angeles Public Library. For more information, visit

www.portoflosangeles.org. �

Long Beach LaunchesHotline For Reporting

Unpermitted Construction


Senior Writer

The City of Long Beach has created anew hotline for the public to report sus-pected unpermitted construction. Open onSaturdays from 7 a.m. to 5 p.m., the hotlineat 562/570-0000 accepts anonymous com-plaints, all of which “will be investigated

and will be subject to a site visit by a codeenforcement inspector,” according to a citystatement. The hotline is intended to bene-fit Long beach neighborhoods and ensurethe health and wellbeing of residents. Afterhours reports may be made to 562/570-2633 or at www.lbcode.org. If an inspector determines a reported

construction site does not have proper per-mitting, an order to stop work will be is-sued to the responsible entity. Failure tocomply with such an order results in cita-tion fines and, in some cases, referral to thecity prosecutor’s office.“Long Beach is committed to promoting

and maintaining a safe, quality living andworking environment,” Mayor Robert Gar-cia said in a statement. “Providing fair, con-sistent and effective public servicesimproves quality of life and enhances everypart of our community.” �

July 7-20, 2015 Long Beach Business Journal 13NEWSWATCH

nal that his top three priorities as CEO arefocusing on the patient experience, whichincludes providing quality care and beingseen as “the trusted provider of health careto our community,” strengthening andgrowing physician partnerships, and guid-ing the hospitals through the health care in-dustry’s transformation towards a focus onpopulation health.“The transformation to population health

is going to take a number of years . . . be-cause the financial model and the reim-bursement environment [are] not designedto support that,” Bishop said. “We are work-ing with all of our payers – Medicare, Medi-Cal, and all the HMOs and the PPOs, to tryand change that model. But we also have towork with our physicians to make sure thatthey are in lockstep with us as we make thattransition,” he explained. “I view that as afive-year goal to be completely convertedto a population health mentality with all ofthe incumbent financial underpinnings.”As for his long-term goal as CEO,

Bishop said, “Long Beach is obviously thelargest provider of health care services inour immediate community, but we’re look-ing to not just be the best provider of healthcare services in Long Beach, but as a sys-tem we are looking to continue to grow tobe the best provider of health care servicesin Southern California.”Part of that vision is continuing to grow

what Bishop refers to as the hospitals’“centers of excellence,” such as the Memo-rialCare’s Heart and Vascular Institute, theTodd Cancer Institute, and Orthopedic In-stitute. He also hopes to “raise the promi-nence” of Miller Children’s & Women’sHospital, which he called MemorialCare’s“hidden jewel” in Long Beach. “The consumer and our patients are our

top priority,” Bishop said. “Maximizing thepatient experience that our communitymembers have is at the front of everythingthat we try to do.” �

Memorial’s John Bishop(Continued From Page 1)



Senior Writer

For the first time, the history of the Portof Long Beach has been captured in detailin a 500-page narrative history book com-missioned by the Long Beach Board ofHarbor Commissioners. Authored byGeorge and Carmela Cunningham, for-merly the publishers of a maritimenewsletter, the book not only examines

the history of the port since it wasfounded in 1911, but also delves intoprior historical events that had an impacton its development.“It wasn’t long after I joined the harbor

commission in 2011 that I realized a de-tailed history of the port had never beenwritten. I wanted to learn more,” DougDrummond, president of the Long BeachBoard of Harbor Commissioners, told theBusiness Journal. “After all, this port’s 100-

year-plus history is an amazing story of suc-cess. Long Beach is one of the top ports inthe country and its story needed to be told.”Drummond continued, “So, two years

ago, I recommended that the harbor com-mission hire a top-notch writer to producea first-rate, unvarnished history of the port.My fellow commissioners agreed and, viaa request for proposals, we found Georgeand Carmela Cunningham. And now, wehave ‘Port Town,’ a book that I heartily rec-

ommend to everyone, especially the resi-dents of Long Beach.”As the book’s tagline explains, it tells the

story of “how the people of Long Beach built,defended and profited from their harbor.” Itwas officially released on June 20 at an an-nual fundraiser for the Long Beach Public Li-brary. In addition to text, the book includeshistorical maps and pictures of the port.According to Carmela, the historic detail

covered in “Port Town” goes as far back aspre-statehood, at a time when the Californialandscape was defined by Native Ameri-cans and Spanish conquistadores. “A lot ofthings that happened before the port washere had impacts on it,” George said.“One of the devices we used as we went

along [was] at the beginning of every chap-ter we would tell what else [was] going onin the world,” George said. “So you have apicture of the world at this time and thenyou have a picture of Long Beach, becauseboth things are important.”The Cunninghams’ research included

daily newspapers, books, transcripts ofcongressional hearings, federal studies andmore. Perspectives of all parties involvedin the port’s history – from squatters wholived on Terminal Island to longshore work-ers to corporate moguls – were all takeninto account and included in “Port Town.”“We tried to . . . look at it from a variety oflenses, if you will,” Carmela said.“It’s an industry but it is also a commu-

nity out there of people who work together,once in a while sue one another, go onstrike,” George said of the Long Beach har-bor. “This was a chance to do a real narra-tive of what happened, who the peoplewere, who the real stewards were . . . and[tell] a story that people could read and beinterested in. It’s kind of like an epic tale.”“Port Town” is available on Kindle for

$1.99, in print from Amazon for $11.89 andis free on Apple’s iBooks application. �


Husband and wife George and Carmela Cunningham are the authors of the new book “Port Town,” a 500 page narrative history of the Port of Long Beach. (Photograph by the Business Journal’s Evan Patrick Kelly)

Port Of Long Beach Releases Narrative History Book

Port Requests Budget Increase For Gerald Desmond Bridge Project


Senior Writer

Port of Long Beach staff is requesting a $203.8 million increasefor the Gerald Desmond Bridge Replacement Project budget atthe Long Beach Board of Harbor Commission’s July 17 meeting,according to a staff report. The last budget increase was approvedby the board in 2013, which took the $1.1 billion budget to a totalof about $1.26 billion. If approved, the currently requested adjust-ment would increase the budget to $1.467 billion.According to a staff report from Duane Kenagy, capital pro-

grams executive for the port, this latest budget increase is largelydue to a directive from the port and Caltrans to “enhance the de-sign of the [bridge] towers . . . to strengthen assurance of the towerperformance in a seismic event.” This directive necessitated timeextensions to complete an enhanced design and incorporate it intothe project’s plans, the report explained. The board recently ap-proved a 725-day time extension on the project.Other issues identified by the report include increased admin-

istrative costs due to project time extensions, overhead and es-calation costs incurred by the project’s designer/builder,“re-establishment or recommended program contingency andrisk register levels,” “new requirements for protection of thestructure from terrorist or catastrophic incidents,” and increasedcosts associated with demolishing the existing bridge.The increased costs do not impact the fiscal year 2015 and 2016

budgets, according to Kenagy’s report.The project to replace the Gerald Desmond Bridge with a new,

taller structure was originally approved by the board of harbor

commissioners in 2010. The original cost estimate for the projectwas $950 million. When complete in 2018, the taller structure willallow for more vehicle traffic on its deck and will enable largervessels to pass beneath it. �

Trade Professionals Name Port OfLong Beach Best In North America


Senior Writer

The Port of Long Beach was recently recognized as the best sea-port in North America at an awards ceremony at the Asian Freight,Logistics and Supply Chain Awards in Hong Kong. Asia CargoNews, an international trade publication, hosted the event.This marks the 17th time the port has been recognized with

the title of “Best North American Seaport” at the awards, whichwere previously sponsored by the publication Cargonews Asia.The award is a reflection of the opinions of more than 15,000importers, exporters and logistics and supply chain profession-als, according to the Port of Long Beach. The port won the titleof “Best Green Seaport” at last year’s event.“We’re working harder than ever to provide the service to our

customers that will keep them coming back to Long Beach,” LongBeach Board of Harbor Commissioners President Doug Drum-mond said in a statement. “It’s great to see the results of efforts,and I’d like to thank Asia Cargo News for this award.”The Port of Long Beach handles more than $180 billion in inter-

national trade from 140 shipping lines on an annual basis. It is cur-rently in the midst of a more than $4 billion capital improvementplan to create new and improved infrastructure capable of handlingthe world’s largest vessels. �

NEWSWATCH


Robert Kleinhenz, chief economist at theLos Angeles County Economic Develop-ment Corporation, scaled back his originalexpectation of a 3 percent GDP growth rateto 2.5 percent for this year. “That puts us inthe optimistic camp, because some morepessimistic views say we won’t even growas fast as last year,” he said, referring to lastyear’s 2.4 percent GDP growth.

“The second half of the year looks goodfor a number of reasons,” Cochrane said.“My guess is this year we will probablyproduce at least two-and-a-half million[jobs],” he said, adding that he expected thesame for 2016.

As of June, the national unemploymentrate was at 5.3 percent, according to theU.S. Bureau of Labor Statistics. “The L.A.County unemployment rate is typicallyhigher than the nation’s and the state’s,”Kleinhenz said. In May, the county’s unem-ployment rate was 7.6 percent, while the na-tion’s was 5.5 percent. National, statewideand regional unemployment rates continueto decrease due to job gains, he pointed out.

Los Angeles County has been outpacing

July 7-20, 2015 Long Beach Business Journal 15ECONOMIC OUTLOOK – MID-YEAR REPORT

Operations at Mercedes-Benz USA’s new 1.1 million-square-foot facility at Douglas Park, whichhouses three of the company’s business units for its Western Region, are now in full swing. The facility,which is home to Mercedes’ Western Region Offices, Vehicle Preparation Center (VPC) and Learning& Performance Center, was constructed within two buildings previously used for aircraft manufacturingby The Boeing Company. The site employs about 200 people. The Western Region Offices serve 82dealerships throughout Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, New Mexico,Oregon, Washington, Texas and Utah by assisting them with customer service, Mercedes policiesand their inventories. In a previous interview, Rory Hepner, general manager of vehicle distributionand logistics for Mercedes-Benz USA, told the Business Journal that the Learning & Performance Cen-ter trains all Mercedes dealership employees throughout its Western Region, running classes aboutfive to six days per week. The Vehicle Preparation Center is the principal operation at the DouglasPark site. Weekly shipments of 4,000 to 5,000 vehicles coming through the Port of Long Beach arewashed, quality checked, tested and accessorized at the VPC, according to Hepner. (Photographsby the Business Journal’s Evan Patrick Kelly)

Special Report(Continued From Page 1)



the national rate of job creation, with a 2.4percent year-over-year growth rate as ofMay in comparison with a 2.2 percent na-tional rate, Kleinhenz said. The state as awhole created jobs at a 3 percent growthrate, bolstered by the strong technology in-dustry in the San Francisco Bay and SiliconValley areas, he noted. Industries leading job gains in L.A.

County include education, wholesale trade,transportation and warehousing, and healthcare, according to Kleinhenz. Health carejob gains are significant in Long Beach,which has four hospitals and is home toMolina Healthcare, a national health careprovider, Kleinhenz noted. Gains in trans-portation and warehousing and wholesaletrade indicate a healthy logistics and goodsmovement sector, which is “so important tothe Long Beach economy” due to the pres-ence of the port, he pointed out.Despite historic levels of congestion at

the ports of Long Beach and Los Angelesat the start of the year due to supply chainissues and labor strife, the ports appear tobe rebounding. “On a year-to-date basisthrough May, port activity for the twinports is down 1.7 percent this year,” Klein-henz said. “But to say at this point in theyear that we are just 1.7 percent behind lastyear’s third best container count on recordsuggests that we are probably lined up todo at least as well as we did last year, whichwould be a pretty good outcome consider-ing how bumpy the start was to the year.”Some industries are still struggling in

L.A. County. “If you see what’s happeningat the national level, there have been somenice gains in both durable and nondurablegoods manufacturing. But that is not thecase here in Los Angeles County,” Klein-henz said. Aerospace manufacturing jobsdecreased by 1,800 positions in the first fivemonths of the year, he said. Still, that sectorhas been fluctuating between about 38,000to 40,000 jobs per year, and remains withinthat range. “It is still a very viable part ofthe local and county economy,” he said.Job gains are likely to have a positive im-

pact on the economy as a whole. “We havemany jobs being created, which of coursehas a multiplier effect in terms of . . .stronger consumer spending,” Cochranesaid. “Consumer spending should be liftednot only by the job growth . . . but also bythe lower gasoline prices,” he added.“We are seeing year-over-year increases

in just about every measure of consumer orhousehold spending,” Kleinhenz observed.Even so, consumer spending hasn’t in-creased as much as some analysts had an-ticipated, he said. Cochrane agreed.“Consumers have been slow to open up

their pocketbooks,” Cochrane said, attribut-ing the cautious behavior to not-so-distantmemories of financial tribulations during theGreat Recession. “It is hard to understandconsumers these days. They are not behavingas one might expect at this point in a businesscycle when you ought to be a little morecomfortable in going out and buying thethings you need.” Still, “all points are leaningtowards stronger consumer spending thissummer and in the fall months,” he added.With more people in the workforce, hous-

ing demand has increased. “Home prices arerising and, in some cases, particularly Cali-fornia, rising pretty quickly,” Cochrane said.

This increases household wealth and drivesdemand for new housing, which in turntranslates into construction jobs. Housingconstruction also creates a demand fordurable goods, which “should drive the man-ufacturing side of the economy over the nextsix months to a year as well,” he explained.“The biggest uncertainty right now is

how well the Federal Reserve can managethe normalization of interest rates they facein the coming year,” Cochrane said. TheFed has estimated it will begin increasinginterest rates in September, he noted.“There is a need to begin raising interestrates as the economy accelerates, particu-larly as we begin to reach what could befull employment next year – somethingclose to 5 percent,” he said.“The expectation is they will be able to

do that with enough guidance that it does-n’t roil equity markets or the bond mar-kets,” Cochrane said of the Fed raisinginterest rates. “But we know from history,back in 2013 when then- [Fed] ChairmanBernanke began talking about the possi-bility of raising interest rates, the bondmarket went a little crazy and market ratesshot up quite sharply for about six monthsand brought a bit of a temporary halt tothe housing rebound,” he recalled. “So thecritical thing is that they manage this insuch a way that the markets adjust in a rea-sonably smooth way.”Sectors of the economy sensitive to in-

terest rate changes are doing well, however,which reduces the risk for economicvolatility if rates are raised, Cochranepointed out. “Fortunately, interest rate-sen-sitive industry sectors in the economy suchas housing are pretty sturdy right now interms of a fair amount of pent-up demandfor housing and, again, rising demand asjob growth grows. So, even if there is somevolatility in interest rates, it shouldn’t derailthe housing turnaround too much.” �

Corporate Aviation Is A

Major Boon ForLocal EconomySay Airport Operators


P rivate jets flying in and out of LongBeach Airport support thousands of

local jobs and bring major business to thearea, according to industry representatives.In an interview with the Business Journal,

several managers of fixed-base operators(FBOs), which supply fuel, hangar spaceand other support services to businesses andcelebrities, said that corporate aviation is amajor asset for the local economy. John Tary, general manager of Toyota

AirFlite, one of the airport’s largestFBOs, said corporate aviation creates a“multiplier effect,” supporting jobs at theairport, such as in maintenance and train-ing, and off the airport, such as in cater-ing, rental cars and hotels.“There is a huge multiplicative effect to

what one airplane landing here in LongBeach means, not only to the core businessof what that aircraft is doing but also tosupport services,” he said. “You’re bringingbusiness to the local area, and that’s the rea-son they’re at this airport. There are also allthe derivatives that occur because of that.”General aviation, which is considered any

aviation other than commercial airlines and

the military, supported some 255,000 directjobs in the United States in 2013, accordingto a study by PricewaterhouseCoopers(PwC) that was released earlier this year. California had 139,100 general aviation-

related jobs, the most of any state, accord-ing to the study. General aviation inCalifornia also contributes $16.2 billion toits gross domestic product (GDP) and gen-erates $10.3 billion in labor income. Long Beach Airport is considered one of

the most diverse airports in the country be-cause it offers a wide range of aviation ac-tivity, including blimps, helicopters, flighttraining and commercial airlines.The 1,166-acre airport complex houses

roughly 5 percent of all business establish-ments in the city and accounts for approxi-mately 9 percent of all jobs in Long Beach,according to the latest study on the airport’seconomic impact conducted by CaliforniaState University, Long Beach three years ago. As an “important and integral part of the

city’s economy,” the airport is responsiblefor 18,000 direct local jobs, including air-port and commercial airline staff, and43,000 jobs in the region, according to thestudy. Those numbers are probably slightlylower today due to the Boeing Company’sdownsizing in Long Beach.Though general aviation activity has de-

clined over the years, many jobs are centeredon providing services to business owners,top executives and celebrities who fly in andout of the airport, industry leaders said. Tenants that rent space from

Aeroplex/Aerolease Group on SpringStreet, for example, employ about 350 peo-ple, said Curt Castagna, the leasing com-pany’s chief operating officer. He said theairport is “an engine in the community” asone of the largest employers in the city,comparable to the international trade indus-try and the Port of Long Beach.

16 Long Beach Business Journal July 7-20, 2015ECONOMIC OUTLOOK – MID-YEAR REPORT

Members of the corporate aviation community at Long Beach Airport convene on a recent afternoon for an interview with Business Journal writers. Picturedfrom left are: Sohail Ashraf, chief financial officer of JFI Jets; John Tary, general manager of Toyota AirFlite; Valerie Boes, manager of JFI JetCenter; Eric Hill,general manager of Signature Flight Support; Damon Danneker, director of operations for JFI Jets; and Curt Castagna, chief operating officer forAeroplaex/Aerolease Group. (Photograph by the Business Journal’s Evan Patrick Kelly)

Special Report(Continued From Page 1)




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“If you think about the depth of clientsthat are here, any town in mid-Americawould kill to have that presence for the jobsit creates,” Castagna said, adding that 80percent of all Fortune 500 companies usecorporate aviation services. Signature Flight Support, an interna-

tional FBO network, offers conferencerooms, a pilot’s lounge, flight planning, aweather-briefing computer, an on-site deli,tie downs and hangar space at Long BeachAirport. The FBO currently employs about35 people, said general manager Eric Hill,who also runs an operation out of Van NuysAirport. He said Long Beach Airport’s10,000-foot runway is ideal for such a di-verse mix of aviation uses. “If you look at the infrastructure, Long

Beach is an amazing airport – right at thetop,” Hill said. “There is everything fromblimps to airlines to manufacturing . . . it’sall here.”JFI Jets, which offers private jet charter

services and aircraft management andsales, employs about 50 people, includingmechanics and charter pilots, at its local fa-cility, said Damon Danneker, the com-pany’s director of operations. JFI Jets isbased out of Long Beach and has offices inFarmingdale, New York, and Nashville.“Take out the rich guys and [look at] it

in terms of jobs,” Danneker said. “It’s feed-ing my family of five and every one of myother employees.”Despite being considered by many as just

a perk for the wealthy, businesses large andsmall use corporate aviation, which is oftenoverlooked as a key economic driver that

provides revenue to the city and generatesthousands of local jobs, he said.“I don’t think there’s an appreciation for

the jobs that corporate aviation provides,”Danneker said. “On multiple different lev-els, there are white-collar jobs all the waydown to blue-collar jobs. It has a path thatcan take you from right out of high schoolall the way to owning your own aircraft andowning your own company and flying allaround the world . . . People look at it as fatcats being fat, but, in reality, there is a hugesupport within that provides income to thecity in the form of taxes.” One major operation at the airport is

Gulfstream, a corporate jet manufacturerthat currently employs 900 people in LongBeach with an aircraft service center, com-pletions facility and sales and design center. The company is expanding its local op-

eration this year with the construction of anew 19,000-square-foot maintenance facil-ity that will enable the Gulfstream to hire50 more employees. The new facility is ex-pected to be operational this summer. “Corporate aviation is an important part of

the local economy in Long Beach,” saidGulfstream spokesperson Heidi Fedak in anemail sent to the Business Journal. She saidthe company’s Long Beach facility alonecontributes more than $76 million to thelocal economy through its annual payroll andpurchases with key suppliers in the region.Though the airport is expected to see a

decline in revenue this year after JetBlue re-duced flights, corporate aviation businessescontinue to make up a large portion of theairport’s revenue with a steady stream of in-come from ground leases, Castagna said. �


(Continued From Page 16)




Financial Services: Roadblocks To Retirement

� By THYDA DUONG

Contributing Writer

I t’s no secret that the road to retirementcan be a difficult one, particularly for

those whose journeys may be littered withroad signs pointing them in many direc-tions – with no clear destination in sight.According to recent findings from the

Wells Fargo/Gallup Investor and RetirementOptimism Index, a survey of 1,005 U.S. in-vestors conducted May 22 through May 31,2015, only 36 percent of all non-retired in-vestors have a written plan for reachingtheir retirement and investment goals.Part of the problem, experts say, lies in

the sheer volume of information availablein the marketplace that could steer individ-uals in the wrong direction.“People feel overwhelmed by the need to

plan for retirement because they’re con-fused,” said accredited financial fiduciaryKaren Codman. “Wherever you go, every-one’s giving you advice . . . People aren’tsure what to do, so they don’t do anything.”A key, experts say, is differentiating in-

formation from education.“It can be pretty daunting for someone to

take their hard-earned money and put itsomewhere they don’t understand,” saidTrent Bryson, CEO of Bryson Financial,

who added that individuals should seek outguidance that’s educationally driven ratherthan product-driven.“Education creates the confidence to in-

vest,” he said. “Unfortunately, the only timepeople learn about what’s happening iswhen the economy’s crashing and they hearall the horror stories – not all the feel-goodstories about somebody who started work-ing at 21, took advantage of compound in-terest and dollar cost averaging, and wasable to retire on time.”For some, too much information and too

little education may create critical gaps thatcould lead to even greater disparities inlater life, experts caution.

For instance, 96 percent of those sur-veyed by the Wells Fargo/Gallup Investorand Retirement Optimism Index noted thatliving comfortably in retirement is a part oftheir “American Dream.” Yet, roughly 92percent of working households aren’t meet-ing the savings targets that they should bemeeting based on their age and income forworking until age 67, according to Eliza-beth Jensen, wealth planning strategist atWells Fargo Private Bank.“Americans, generally across the board,

just aren’t very good at saving,” Jensen toldthe Business Journal, noting that 38 millionworking age households don’t have any re-tirement account assets, which translatesinto a median retirement account balance of$3,000 for a working age American and only$12,000 for near-retirement households.“There’s a bit of a disconnect in what

we’re seeing people do and where theysay they want to be,” Jensen added. “Itdoesn’t mean they’re going to necessarilybe destitute; it just means they’re notgoing to be able to afford the lifestylethey’re envisioning.”Part of the challenge of retirement plan-

ning, experts say, is establishing a realisticvision of what retirement might look like,including preparing for potentially longerlife spans while taking into account thevariability of supplemental incomes.“One of the challenges is that many peo-

ple don’t fully understand social security,”Codman said. “For most people, social se-curity will provide between one-third andone-half of their living expenses, so it’s avery important part of your retirementplanning, but it’s not all there is . . . Youhave to be diversified. You can’t just planon one thing.”

This is especially important for businessowners, Codman noted, noting that somemay tend to overestimate the value of theirbusiness. “A lot of business owners tell me,‘I don’t need a retirement plan because mybusiness is my retirement plan,’” she said.“What they’re going to find out, when pushcomes to shove, is that their business maynot be worth what they think it is, especiallyif they don’t have a coherent exit strategy.”Industry experts agree that planning ap-

propriately for the future requires trade-offsin the present – which isn’t always easy. Fi-nancial and circumstantial challenges tosaving for retirement run the gamut fromheavy debt loads and unplanned expenses

to unexpected layoffs, job losses and stag-nant income levels.“Life is becoming a little more dy-

namic,” said J.C. Abusaid, president andchief operating officer of Halbert Har-grove. “We’re finding some clients are get-ting caught in the sandwich generation, sothey’re not only having to care for theirkids, but also their parents, and then on topof that they’re supposed to take care ofthemselves and save for retirement.”

Getting On TrackWhile the challenges to saving can be

difficult, industry experts generally agreethat individuals should start saving as soonas possible – with a clear roadmap of wherethey’re going and how to get there.“When you’re young, you’re either trying

to pay off college debt or you’re trying tobuy your first house,” Bryson said. “As youget a little bit older, you’re now paying forchildren and sports programs. And thenwhen you get toward retirement you’restarting to have healthcare expenses.“The sooner you start the savings habits

in life, I think the much higher chance youhave of retiring on time, more so than mak-ing more money even,” he added. “I hearpeople say, ‘Oh I’ll wait until I get a raiseor a new job,’ but they would’ve been betteroff putting in less money and letting themoney go to work for them over time.”Similarly, Abusaid stressed taking advan-

tage of time, while cautioning against rely-ing on the potential for high short-termmarket returns to build adequate retirementassets. “The returns that the market canprovide are not going to be the big double-digit returns of the ’90s,” he noted. “Themarket’s not going to make up for what youdidn’t save. You’re going to have to actuallyput the money away. You can’t expect themarket to make up the difference.”“If you start in a very methodical but

slow, incremental process, that’s probablythe best way,” Abusaid said. “Because onceyou start it, there’s momentum that startsbuilding . . . and eventually you’ll be ableto get to the right [savings] rate.”Jensen recommended maxing out quali-

fied plan contributions when possible (thecurrent annual maximum 401K contribu-tion limit for an employee is $18,000), butto balance building retirement savings withestablishing a sufficient emergency fund ofat least six to nine months of income.“It may make sense to build both at the

same time – contribute enough to get theemployer match, for instance,” she said,“but it definitely does not make sense tofully fund your retirement plan when youhave nothing set aside for emergencies andunexpected needs.”Taking a comprehensive look at your fi-

nancial situation, Codman added, is essen-tial when developing a savings plan – andis especially important when seeking out afinancial advisor.“You want to find someone you can trust

who’s knowledgeable, and who will takeinto account your entire situation and giveyou very personalized advice,” she said.“You want someone who will take timewith you to really delve into everything –your tax situation, your estate planning, forinstance – and put together a plan that’sright for you.”With a plan in place and a destination in

mind, individuals also need one more thingwhen it comes to saving – patience.“There’s no silver bullet,” Abusaid said.

“There’s no magic to get it done. Saving forretirement is a process that requires con-stant attention. It requires discipline [and]for sure it requires perseverance and sacri-fice. So . . . if anything contradicts that,meaning if it’s supposedly an easy formula[and] if it violates those rules, then peopleshould be aware that whatever they’re bas-ing their decisions on is probably off . . .“You have to balance the short term with

the long term,” he stressed. “There’s atradeoff between having a nice lifestyletoday versus having a secure future.” �

The Invisible Infrastructure:Utilities ThatYou Count On

� By MICHAEL GOUGIS

Contributing Writer

I magine, for a moment, what a 21st cen-tury Southern California home would

look like to a visitor from 200 years ago.Water just shows up from metal fixtures;waste disappears down a hole and is goneforever. Light emanates from glowing ob-jects in the ceiling, a box in a cabinet usessomething called “radiation” to heat food,and neither of these creates any heat,smoke, or uses any visible flame.We take this stuff for granted nowadays.

But it’s not just the technology that makesthese devices and processes so impressive.It is the reliability of the systems that de-liver the energy and raw materials thatmakes the technology usable. No one isgoing to develop a microwave oven if thereis no electricity, and no one is going to buya microwave if you can't rely on being ableto power it every time you want to use it.Utilities make up an invisible skeleton

that supports every facet of daily life forthose of us fortunate enough to live inSouthern California. We admire the art-work that adorns the walls of our homesand rarely, if ever, think of the beamswithin those walls that make it possible tohang that artwork. Similarly, we marvel atour newest smart phones but rarely think ofthe miracle allowing millions to powerthose devices, simultaneously, wheneverwe want, for remarkably little money andwith increasingly minimal environmentalimpact. That is, we don't think of it until thebattery warning light starts flashing . . .“The system has delivered throughout

our history. There have been no major in-terruptions. That’s been one of the charac-teristics of our type of utilityinfrastructure,” said B. Anatole Falagan, as-sistant general manager of the Long BeachWater Department, which recently cele-brated more than a century of operations.“It is that silent infrastructure that deliv-

ers service to the customers day in, day out,and they many times are unaware of the re-liability of using it,” Falagan said.“Whether that’s turning a switch on foryour electricity, or turning the faucet on toget your water, or simply flushing the toiletor letting the water go down the drain to thesewer, what happens after that or before


“I hear people say, ‘Oh I’ll wait until I get araise or a new job,’ butthey would’ve beenbetter off putting in

less money and lettingthe money go to workfor them over time.”

Trent Bryson, CEOLong Beach-based Bryson Financial


(Photograph by the Business Journal’s Evan Patrick Kelly)



that is an incredible story of reliability, andmany times the customer is unaware of it.”How did the Long Beach area wind up

with a utility network that works so wellthat we rarely think of it?First, by securing the raw materials

needed. The city’s water department, forexample, has its own network of wellsthat tap into the groundwater supplies, aswell as connections to water deliveredfrom the Metropolitan Water District.And the city’s water department has – andhas fought hard to defend – the legalrights to those sources of water.The reality is that the raw materials – nat-

ural gas, oil, electricity, even water – nor-mally are plentiful. Even in times ofdrought, there are reservoirs that storewater for non-rainy days. And with eachpassing day, more and more renewable re-sources – solar-to-electricity, wind-to-elec-tricity – come on stream. And new storagetechnology – including banks of high-techbatteries and flywheels – is allowing evenelectricity to be stored.Bob Weisenmiller, chair of the California

Energy Commission, spoke with the Busi-ness Journal of the days of rollingbrownouts and electricity shortages. “Backthen, when you flicked a switch, you didn’tknow if the lights would come on, and ifyou drove to an intersection you didn'tknow if the signals would be working,” hesaid in a phone interview. These situationsare bad for everyone, Weisenmiller ex-plained, but for a state that is home to Sili-con Valley and high-tech electronicallydriven industries, a state of power unrelia-

bility poses extreme challenges to the eco-nomic infrastructure.“Since then, we have beefed up the sys-

tem,” Weisenmiller said. “We have in-creased the amount of solar and windpower more than two and a half times since2012. We’ve taken extensive action to mod-ernize gas-fired power plants. One of thesteps has been to add new plants. We’vehad a number of plants re-powered. And[there is] an exciting opportunity to com-bine solar thermal and storage.”But you still have to deliver the goods to

the end user. That requires a stable deliverynetwork. Redundancy in the delivery sys-tems helps ensure that when somethinggoes wrong, a backup system kicks in.The best approach to generating stability is

as old as the elements themselves: Vigilance.

Chris Garner, director, Long Beach Gas& Oil Department, said that the gas sys-tem’s reliability is such that the entire net-work has not been shut down since thedepartment was established in 1924. Thebiggest outages he can recall have af-fected small groups of homes or, once, acouple of blocks, when contractors orother outside problems disrupted servicefor short periods of time.“We do constant maintenance on the

pipeline,” Garner stressed. “Just in 2015,we’re investing about $10 million inpipeline replacement. We’re replacingabout 50 miles of main pipeline in the cityin 2015. We’re monitored by the federalgovernment. We have to submit an annualreport to the federal government that de-scribes in detail our pipeline system as far

as size, material of pipeline, pressure, anytype of weaknesses we can perceive in oursystem, and how we’re going to addressthat. We do that on a regular basis.“On top of that we’re required by regu-

lation to physically go out and walk thepipeline system, every inch of it,” he added.“We do 20 percent of the system everyyear, so we do the entire system once everyfive years. We have electronic sniffers thatwe walk over the pipeline and see if we candetect any odor coming out.”It makes sense from a safety point of

view and from an economic point of view,Garner said. And the end result is a gas de-livery system so reliable that most cus-tomers never think about it.“It’s so much more expensive if we have

to go out,” he said. "If there is a damagedor leaking gas pipeline, it’s so much moreexpensive to mobilize the crews, to go outand dig up that street – it’s so much moreexpensive than if we just do regular main-tenance on the pipeline.” �

Getting At TheOil On The Run: Diatoms, Steam,Production AndEnvironmentalProtection

� By MICHAEL GOUGIS

Contributing Writer

T he easiest oil to get at exists at a veryspecific geologic strata, where the

combination of heat from the center of theearth below and pressure from the crustabove makes the raw petroleum flowsmoothly up the well pipe and – after a bitof manipulating – into the tank of your car.But oil leaks out of those sedimentary

layers and can get trapped in places whereit isn’t as easy to get to. And we're talkingabout a lot of oil – by some estimates, athird of the world’s petroleum resources aretrapped in impermeable rock.One of the latest technologies to get at

that oil is becoming more and more wide-spread in California. Cyclic Steam Injec-tion – or “huff and puff ” as it is informallyknown in the industry – is nothing new, but,as oil producers seek more effective waysof getting at that “hidden” crude, it is at-tracting additional attention from those ex-tracting oil from the Monterey Shale – themother lode of oil in the state. And it offerscompanies one way of balancing environ-mental protections with the ability to ex-tract crude from places that mightotherwise go untapped.“It’s a production technique, and it’s the

latest whiz-bang thing that is pretty promi-nently used in California to extract this oilfrom the diatomaceous earth,” said BobPoole, vice president of upstream cam-paigns for the Western States PetroleumAssociation, an advocacy organization forthe petroleum exploration and processingindustry in the West.A brief geology lesson is necessary here.

Millions of years ago, one of the seas that


Chris Garner, director of the Long Beach Gas & Oil Department, said that his staff is constantly main-taining the city’s pipeline system and plans to invest nearly $10 million this fiscal year on pipeline re-placement. (Photograph by the Business Journal’s Evan Patrick Kelly)





covered California left a layer of sedimen-tary rock packed with the dead bodies ofanimals, fish and plants. The biggest for-mation is known as the Monterey ShaleFormation, a 1,750-square-mile region,where the source rock contains the easier-to-extract oil, Poole said.“Most of the oil production in California

comes out of marine layers. For oil to bemade, you need two things: heat and pres-sure. It’s sort of like a pressure cooker,”Poole said. “The oil has to be far enoughdown in the earth so it has heat coming upfrom the center of the earth. And it has tobe far enough underground so that the over-grade – all the rocks on top of it – createenough pressure so that those two thingscan allow for the transformation of this car-bon matter, these plants and animals, intooil and natural gas.“In California, regular production comes

out of the Monterey Shale. But there is alayer that occurred later, closer to the pres-ent time, even though it’s still millions ofyears ago. There are these little microscopiccreatures called diatoms. When they died,their bodies floated down and mixed withthe sediment that was at the bottom of thesea. Basically, there are little hollow skele-tons of them. You can only see them througha microscope. But in some places, this di-atomaceous layer is a thousand feet thick.”Through the normal process of rocks

splitting and fracturing through movement(such as earthquakes) some of the oil in thesource rock beneath the diatomaceous layerhas leaked upward. This is problematic toget to. It is not as viscous as the oil deeperdown, which is hotter and under more pres-sure, and the diatoms act like the cells in aStyrofoam cup – hollow but impenetrable.Cyclic steam injection is a process by

which superheated water is forced into thisdiatomaceous layer and allowed to sit. Theheat transfers to the oil in the sediment,making the petroleum runnier (to use a tech-nical term). And, as the steam condenses, thediatomaceous earth attracts the water. Pres-sure builds and forces the oil up out of thesame well drilled to inject the steam into theground. And the cycle is repeated until theratio of oil to water coming back out of theground no longer warrants recovery. Thewater is left in the soil to maintain the struc-tural integrity of the sedimentary layer.

The technique is attracting attention be-cause traditional hydraulic fracturing tech-niques simply aren't suited for California'sgeology. Hydraulic fracturing works beston a straight horizontal line. California'scrust is bent, warped and woofed to thepoint that hydraulic fracturing’s use hasbeen limited in scale. And, while one inci-dent in a Kern County oilfield raised con-cerns that too much pressure could createsinkholes and geysers nearby, the practiceof Cyclic Steam Injection does not requirethe shattering of rock underground as hy-draulic fracturing does, nor does it utilizethe chemicals used in hydraulic fracturingthat have caused environmental concerns.Environmentally conscious oil extraction

of all types pays benefits, not just for theresidents of California, but for the industryas well. Frank Komin, executive vice pres-ident, Southern Region, California Re-sources Corporation (CRC), pointed outthat environmentally conscious producingin California has paid benefits to LongBeach residents for decades – the THUMSoil islands off the coast of Long Beach arecelebrating 50 years of operation in 2015.“CRC’s core strength is being a safe and

efficient California producer of crude oiland natural gas. This is how we create valuefor our stockholders, increase California’senergy security and best contribute to ourcommunities and our state,” Komin said. “THUMS islands’ unique combination

of production functionality, visual appealand environmental and safety features hasgarnered the facility dozens of awardsand recognition from local, state and na-tional organizations. CRC is proud to op-erate in the Long Beach area and tocontribute to the city’s success. We arecommitted to being a good neighbor andto protecting the environment in LongBeach, and we design and maintain ourfacilities with our neighbors, communi-ties and the environment in mind.”And Komin pointed out that the fact that

the oil is being produced in Californialeads to specific, significant environmen-tal benefits.“Unlike imported energy, local oil and

gas production meets California’s stringentsafety, labor and environmental standards,which are the most comprehensive of anyoil-producing state,” Komin said.“The company invests in state-of-the-art

equipment and tools to find, develop, pro-duce and deliver energy resources through-out the state. Technology plays an integralrole in every phase of this process, from ex-ploration to field development to opera-tions management.” �

Potential Solutions To The Projected Primary CarePhysician Shortage


Senior Writer

S tudies commissioned in the past fewyears have consistently determined

that, due to an increasing demand for healthcare, there will be a significant shortage ofprimary care physicians in the UnitedStates within the next five to 10 years. A March 2015 study commissioned by

the Association of American Medical Col-leges (AAMC) anticipated a shortfall of12,500 to 31,300 primary care physiciansby 2025. A 2013 study by the U.S. Depart-ment of Health and Human Services (HHS)projected a nationwide shortage of 20,400primary care physicians by 2020.When specialty care physicians, such as

surgical and medical specialists, are fac-tored in to the picture, the shortage antici-pated by AAMC’s study expands to 46,000to 90,000 physicians by 2025.Health care professionals posit that po-

tential solutions include expanding primarycare training opportunities for physicians,fostering a team-based care approach andimplementing technological tools for pa-tients to more readily access primary care.Another solution – one backed by theAAMC and HHS – is to allow nurse prac-titioners and physician assistants to provideprimary care within the scope of their li-censure, education and training.“Addressing the shortage will require a

multi-pronged approach, including innova-tion in delivery, greater use of technology,improved [and] efficient use of all healthprofessionals on the care team, and an in-crease in federal support for residencytraining,” a summary of the key findingsof AAMC’s study stated. “The study’s re-sults confirm that no single solution willbe sufficient on its own to resolve physi-cian shortages.”“One of the problems is there are not

enough training spots in residency pro-grams to actually produce enough primarycare physicians,” Dr. Mark Schafer, CEOof MemorialCare Medical Group (part ofMemorialCare Health System), told theBusiness Journal. Molly Weedn, associate vice president of

public affairs for the California Medical As-sociation, agreed with Schafer’s assessmenton residency training opportunities. “In-creasing the number of residency slots inCalifornia is critical to ensuring the pipelineis full,” she wrote in an e-mail to the Busi-ness Journal. “Right now, because of thecap on funding for residency programs (tiedto Medicare), doctors are graduating frommedical school and are being forced to ac-cept residency programs in other states,where they often set up practice. Keepingthem in California is a step to ensuring wehave more doctors here,” she explained.“I would like to see the department of

health and human services fund more train-ing,” Schafer said. “The Affordable CareAct did put forward a few hundred milliondollars in new money to expand primarycare training, but I don’t think it’s adequate.”The Affordable Care Act “has provided

nearly $230 million to support the trainingof an additional 1,700 primary care med-ical residents, nurse practitioners andphysician assistants,” according to HHS.Schafer may soon get his wish for more

federal funding to train physicians. Presi-dent Obama’s Fiscal Year (FY) 2016 budgetincludes $14.6 billion for the purpose ofbolstering the health care workforce. About$4 billion of that amount is dedicated to theNational Health Service Corps, which pro-vides health care to Americans with limitedaccess to care. “The proposed investment inthe National Health Services Corps is pro-jected to support a field strength of 15,000providers in FYs 2015-2020 and serve theprimary care needs of more than 16 millionpatients,” a March HHS report stated. Additionally, a new Targeted Support for

Graduate Medical Education program, forwhich President Obama budgeted $5.2 bil-lion, “will support the training of 13,000residents over 10 years,” according to HHS. Weedn called for more funding to sup-

port primary care physicians in rural areasto help address physician shortages.Specifically, she suggested expanding theSteven M. Thompson Physician CorpsLoan Repayment program, which “autho-rizes a plan for repaying up to $105,000 ineducational loans in exchange for full-timeservice for a minimum of three years” indesignated health professional shortageareas, according to California’s Health Pro-fessions Education Foundation.MemorialCare Medical Group, a physi-

cian-based organization with more than250 physicians at 29 locations from LongBeach to Dana Point, has implemented itsown physician training program to ensureit is able to meet growing demand, accord-ing to Schafer. “We have a family medicine



“Unlike imported energy, local oil andgas production meetsCalifornia’s stringentsafety, labor and environmental

standards, which are the most

comprehensive of anyoil-producing state.”

Frank E. KominExecutive Vice President, South Operations

California Resources Corporation


residency at Long Beach Memorial [Med-ical Center], and it has been great to be ableto train those doctors in our system andthen be able to offer them employment op-portunities in either our medical group orIPA [independent practice association]once they finish,” he said. “We also have a close affiliation with UC

Irvine and their residency training programfor internal medicine and pediatrics,”Schafer continued. “We train them atMiller Children’s [& Women’s HospitalLong Beach] and Long Beach Memorial,so we have that pool of doctors who areavailable to us when they finish.”In addition to supporting and developing

workforce-related solutions, MemorialCareMedical Group has implemented technolo-gies to help meet increasing primary caredemand. Through a telephone advice line,“we have 24/7 access to a registered nursewho can handle a lot of problems throughprotocols that have been approved by physi-cians,” Schafer said. This gives physiciansmore time to see patients, and is also con-venient for patients themselves, he noted. Both Schafer and Weedn emphasized the

importance of implementing team-based ap-proaches to provide better quality and accessto primary care. In this model, the primarycare physician acts as “the quarterback ofcare,” and works with advanced practiceproviders such as nurse practitioners orphysician assistants to handle issues withintheir training,” Schafer explained.This model, often referred to as a “medical

home” for patients, frees up the physician tofocus on care only he or she is qualified for,Schafer explained. “Then we have pharma-

cists and social workers and sometimes evenbehaviorists as part of that team, [which] al-lows the doctors to be more efficient.”On June 30, California Senate Bill (SB)

323, which would have allowed certifiednurse practitioners to practice to the fullestextent of their education, training and cer-tification without the supervision of aphysician, failed to pass the California As-sembly Business and Professions Commit-tee. Schafer and MemorialCare hadsupported the bill, as had the California As-sociation of Nurse Practitioners. “It is important to have additional

providers who have advanced training inour health care delivery system,” Schafersaid. “There are 21 states outside of Cali-fornia that have already embraced nursepractitioners practicing at the full scope of

their training . . . It is critical to have themtaking on that role with the primary carephysician shortage.”According to HHS’s 2013 study on the pro-

jected primary care physician shortage,“Under a scenario in which the rapidly grow-ing nurse practitioner and physician assistantsupply can effectively be integrated, the short-age of 20,400 physicians in 2020 could be re-duced to 6,400 primary care physicians.”The California Medical Association

(CMA) opposed SB 323, contending its pro-posed lack of physician oversight of nursepractitioners would have jeopardized patients.“We commend the assembly for rejecting SB323, which would have significantly compro-mised patient safety,” CMA President Dr.Luther Cobb said in a statement. “SB 323would have done nothing to address access to

care, and absent a bar on the corporate prac-tice of medicine, adequate physician andmedical board oversight, and the extensivetraining necessary, this legislation would haveonly put Californians at risk.”Donna Emanuele, president of the Cali-

fornia Association of Nurse Practitionersand a registered nurse working in bothemergency and family medicine, arguedthe bill would have made a positive impact. “When we look at California, we have

millions of newly insured [patients] com-ing into the health care system in responseto the Affordable Care Act,” Emanuelesaid. “Nurse practitioners are part of thesolution to help increase the workforceability here in the State of California sothat we are in a much better position tomeet their health care needs.” �

July 7-20, 2015 27

Mark Schafer, CEO of MemorialCare Medical Group, believes that promoting team-based care models in which primary care physicians work with specialists,advanced care practitioners and other health care professionals, is one solution to a projected primary care physician shortage. Pictured at MemorialCare’sambulatory care center at the Los Altos Market Center Dr. Daniel Kim, a family practice physician (left), and Dr. Linh Nguyen, a pediatrician, consult with apatient with the assistance of Marisol Ramirez, a nurse, second from right. (Photograph by the Business Journal’s Evan Patrick Kelly)


How The San Pedro Bay Ports

Are Working Together To Ensure

Future Growth� By SAMANTHA MEHLINGER

Senior Writer

S ince unprecedented levels of harborand terminal congestion were re-

solved in the first quarter of 2015 and normaloperations have resumed, the ports of LongBeach and Los Angeles have redoubled theirefforts to work together and with trade stake-holders to resolve supply chain issues andensure future business growth for the ports.The way cargo flows into and out of ports

has been altered in the past couple of years,largely due to decisions made by the world’socean carriers, such as to form alliances toship their goods together. According toMichael Christensen, supply chain executivefor the Port of Long Beach (POLB), “over90 percent of ocean-going containerizedcargo is moving in one of only four al-liances.” This “massive market share” givesthe alliances “tremendous control,” he noted.

Now that multiple shipping companiesare stowing their cargo together on thesame vessels, that cargo isn’t being loadedin an organized manner as ships travel fromport to port. And, while the mega ships ofjust a few years past were able to carry12,000 to 15,000 twenty-foot equivalent(TEU) container units of cargo, today’slargest vessels carry between 18,000 and21,000 TEUs. “Terminals are simply toosmall and unable to absorb the massiveflood of unsorted containers that come off[these ships],” Christensen explained.These and other changes in the way ship-

ping lines conduct their business have causeda ripple effect throughout the supply chain.“The terminal operators struggled over thisissue, coming up with solutions that have at

times caused massive problems to thedrayage truck drivers,” Christensen said, ex-plaining how, when one party in the supplychain came up with a solution to improve itsown efficiencies, it often resulted in prob-lems for the next leg of the supply chain.“We see this stark evidence that every-

body is postured in positions to affect theirown efficiencies, but not affect the overallsupply chain,” Christensen said.These issues, coupled with slowdowns

caused by contract negotiations for long-shore workers, led to historic levels of con-gestion at local ports last year. Beneficialcargo owners (BCOs) – the major retailersand wholesalers of the world, such as Wal-mart, Target and other big companies rep-resented by the National Retail Federation

– began asking for the ports of Long Beachand Los Angeles, which operate as land-lords for their tenants (terminal operators),to play a larger role in resolving the issues.“When a firm like Abercrombie & Fitch

makes a big public statement [like it did]back in February or March that said, ‘We areno longer taking any of our goods into theSouthern California gateway,’ a lot of marineterminal operators and even the ILWU [In-ternational Longshore & Warehouse Union],sit up and take notice and say, ‘Whoa, we justlost a bunch of business,’” Christensen noted.The ports requested that the Federal Mar-

itime Commission expand an existingagreement allowing the ports to work to-gether to resolve supply chain issues.Shortly after that request was granted, thetwo ports’ head executives, Jon Slangerupof Long Beach and Gene Seroka of LosAngeles, met and decided the best movewas to gather affected parties in one room. The resulting meeting on April 23 drew

what Port of Los Angeles’s (POLA) MichaelDiBernardo, deputy executive director ofmarketing and customer relations, called a“Noah’s Ark” of stakeholders. “We broughtin more than 100 cargo owners, truckingfirms, longshore labor, marine terminals andother people within the supply chain, to listento them and find out what issues they haveand where they think improvements shouldbe made in the supply chain,” he explained.The meeting was the first time these

groups were brought together in one placeto find solutions to benefit them not just in-dividually, but as a whole. The presence ofbeneficial cargo owners in the discussionhelped spur dialogue. “What made them[supply chain stakeholders] willing to com-municate was largely the involvement ofthe BCOs, because everybody . . . under-stands that they make the routing deci-sions,” Christensen explained.Following that meeting, leadership from

the ports met together and identified sevenareas of focus – gleaned from the April 23meeting – upon which to form workinggroups of port representatives and supplychain executives representing labor, truck-ers, railroads, shipping lines, BCOs, termi-nal operators and other involved parties.A focus group dedicated to identifying

issues to address before 2015’s peak ship-ping season (which officially begins at theend of July) was the first to meet. Thegroup’s purpose is to identify “what it isthat we can correct immediately to help thesupply chain,” DiBernardo said.After meeting in May, the group identi-


The Port of Los Angeles’s Michael DiBernardo, deputy executive director of marketing and customer relations, left, and Chris Chase, business developmentmanager, have been working with the Port of Long Beach and international trade stakeholders to resolve supply chain issues and ensure future businessgrowth at the ports. (Photograph by the Business Journal’s Evan Patrick Kelly)


fied 30 items to address, which have sincebeen whittled down in subsequent meetingsto five key issues, including: marine termi-nal gate operation efficiency, appointmentsystems used by truckers to pick up cargofrom terminals, skilled labor and training,availability of chassis (truck trailers tomove containers), and the status of ware-housing, according to Christensen. Thegroup meets every week to 10 days,DiBernardo said.Additional issues identified by the peak

season 2015 focus group may be passed onto the other six focus groups. The nextgroup likely to convene is the “key perform-

ance indicator and data solutionteam,” DiBernardo said. In dis-cussions with goods movementindustry professionals, one ofthe major issues identified wasa lack of data available to tracka container’s movementthroughout the supply chain, heexplained.Other focus groups planned

include: a container terminaloptimization group, focusingon improving the movement ofcargo from ships into termi-nals; an off-dock solutionsgroup, examining how to movecargo more efficiently out ofterminals; an intermodal railgroup, aiming to “improvingefficiencies of getting cargomoved to inland locations;”and a group targeting drayageissues such as truck driver turntimes.

“The goal here is to keep our terminalsfluid and get the cargo out to the customersas quickly as possible with minimal delaysto anybody who touches the container,”DiBernardo said of the port’s joint meet-ings with labor, trade and goods movementprofessionals.“Supply chain experts will almost always

tell you that the enemy to a good supplychain is variability,” Christensen said. “Theend point of this whole effort are two is-sues: reliability and velocity.”Achieving these two end goals is impor-

tant to the future of the ports. “We are not,never have been and probably never will be

the absolute low cost provider of services,”Christensen said. “Our labor is not cheap.Our property and development is notcheap. But what we are is we are the pre-miere gateway in terms of velocity.”When the ports’ reliability and efficient

velocity of goods movement suffer, discre-tionary cargo – cargo destined for areas notin the immediate vicinity of the ports – maybe routed elsewhere, Christensen ex-plained. “It’s not going to come to our gate-way if we don’t make the reliabilitysufficient to satisfy the BCOs.”“They want that reliability back,” Chris

Chase, business development manager forPOLA, said of the BCOs who have becomevocal and who extended help through theports’ working groups. “We have seen traffic bleed off to the East

Coast ports, and there is a significant possi-bility of more diversions through the SuezCanal,” Christensen said. Canadian portshave also become a source of competitionfor their efficacy in modifying their policiesto accommodate demand, he noted. “Mexicois investing $5 billion in their ports . . . wehave to be watching them closely,” he added.Despite the competition, the ports of

Long Beach and Los Angeles remain ide-ally positioned for cargo traffic from Asia,DiBernardo pointed out. “We have the fa-cilities to accommodate larger ships,” hesaid. “Here at the ports of L.A. and LongBeach, we have been investing in the fu-ture. We have been doing that by dredgingour main channel, doing upgrades to ourcurrent facilities by deepening the water upagainst the wharf to allow for bigger ships,[and] working with the terminal operators

on terminal development,” he explained.“What we are doing is positioning our-

selves for the future,” DiBernardo said.“We have decided that the supply chain

needs adult supervision and that it has to beus,” Christensen said. “Because there is no-body else out there who is unbiased enoughto do that. And we have so much at stake.” �

Local RetailersLook To SocialMedia, EventsAnd CreatingSense Of PlaceTo Draw In Customers


S ince taking over Blue Windows, asmall retail shop on 2nd Street in

Belmont Shore that sells clothing, jewelryand other “lifestyle” items, nearly 11 yearsago, Heather Duncan has attracted a loyalfollowing through social media. Her Instagram page, for instance, now

has more than 3,200 followers. Regularly

July 7-20, 2015 Long Beach Business Journal 29ECONOMIC OUTLOOK – MID-YEAR REPORT

Michael Christensen was hired on as the Port of Long Beach’s sup-ply chain executive lead in February of this year. In this newly cre-ated position, Christensen “is responsible for workingcollaboratively with industry stakeholders to find new ways to in-crease communication and cooperation among the links of the sup-ply chain to enhance cargo flow,” according to the port.(Photograph by the Business Journal’s Evan Patrick Kelly)



posting artsy images of items in the storeisn’t a waste of time, she said. In fact, it hasbecome a way for Duncan to directly inter-act with customers while showcasing newproducts and trends. “A lot of people have specifically told

me, ‘Oh, I followed you on Instagram andI wanted to come down and see it,’” saidDuncan, who bought the store in 2004 afterworking part time there after earning amusic degree. Several small business retailers inter-

viewed by the Business Journal describesocial media as their main marketing toolfor drawing customers through the doors,in addition to hosting special events andcreating a sense of place in the community.In the last few years, social media sites,

whether it’s Instagram, Facebook, Twitteror Pinterest, have become Duncan’s keymarketing apparatus. In addition, she justrecently launched a new website for herstore that now allows customers to buymerchandise online.“I feel like I started a little late in the

game, but that’s how I have reached mycustomers mostly,” said Duncan, whoserves as vice president of promotions andmarketing for the Belmont Shore BusinessAssociation. The new website allows cus-tomers to keep up with her blog, learnabout events and sign up to get regular e-mails about the store. Susanne Lee, owner of Trance on At-

lantic, a women’s clothing boutique on At-lantic Avenue in Bixby Knolls, said shealso utilizes social media sites, includingFacebook and Instagram, to promote itemsin the store, in addition to using her ownwebsite. Although Lee, who opened her store

nearly two years ago after leaving a similarbusiness in Manhattan Beach, doesn’t sellitems directly online, customers may callin to make a purchase after seeing mer-chandise on the website, she said. “We do have a website we use to up-

date photos,” Lee said. “A customer willgo on it and see certain pieces and say,‘Oh, I like that. Can you ship it to me?’And we absolutely do. We pretty muchship everywhere.”Lee said another way to keep sales hum-

ming is through branding and having aclose connection with customers. While mainstream clothing stores, such

as Nordstrom Rack and Forever 21, aregeared more toward the younger crowd,Trance mostly caters to women, particu-larly moms, age 30 and older, she said. “I’m a mom myself and the girlfriend

that helps me out is a mom, and we stillwant to look good, but we don’t want tolook like we’re wearing our kids’ clothes,”Lee said. “We still want to be in fashion,and there’s a need for fashionable wear.”Understanding the demographic allows

her to have a personal connection with cus-tomers and also comes in handy when se-lecting merchandise to sell, she said. “We stay in close contact with a lot of

our customers and in fact a lot of them havebecome our friends,” Lee said. “That’s howwe know what they want.”Supporting local venders is also impor-

tant, she said, adding that 80 percent of hermerchandise is local and more than 95 per-cent is American made.Lee said her store also stays heavily in-

volved in the community, hosting a regular

in-store mixologist during the monthlyFirst Fridays event organized by the BixbyKnolls Business Improvement Association. “We do events every month,” she said.

“You have to get people excited aboutthings that you’re doing . . . That’s how wemeet new people.”Dana Robertson, owner of Restauration

restaurant, which opened a year ago as oneof the newest additions to 4th Street’s RetroRow, said social media is currently her“biggest aspect” of marketing. “We’re prevalent on Instagram, and

we’re also on Facebook, and try to keep ourwebsite up to date,” she said, adding thathaving an online presence and being in-cluded on websites such as Yelp havehelped people find the restaurant. Besides some local print advertising,

collaborating with people in the commu-nity is also important to connect with cus-tomers, Robertson said. For instance, herrestaurant, which serves American cuisinewith a modern flare, hosted a “farmbrunch” that benefited Farm Lot 59, alocal farm in Signal Hill. Robertson opened the restaurant, which

gets its name from combining the wordsrestore, restaurant and relaxation, withher husband, Rob, at a location that usedto be home to 212 Patio Bistro. For therestaurant’s one-year anniversary on July22, Robertson is planning a “BluegrassBoil” that will include live bluegrassmusic and will benefit The Long BeachDepot for Creative Reuse to “bring atten-tion to the importance of reducing wasteby creative reuse.”Cirivello’s Restaurant Lounge Sports Bar

has also gravitated to social media to drawin customers, said General Manager DannyHarris. The establishment officially re-opened its doors last year at 4115 N. VikingWay in Parkview Village in Northeast LongBeach after briefly closing and once re-opening as The Station. “We’re doing a lot of social media,” Harris

said. “We try to do that as much as we can.”The restaurant and sports bar, which un-

derwent renovations including upgradedbanquet rooms and a new 24-foot by 16-foot high definition TV for watching sport-ing events, already has a loyal customerbase in the community after being in busi-ness for 32 years, Harris noted. “We recently took it over again, and

we’re just running with it,” he said. “I got ahold on the community. I know what theylike and what they don’t like. We madechanges back to where it was, and it’s beenreal busy.”In coming months, Cirivello’s is planning

to host community events – possibly a beergarden or a movie night in the parking lot– to draw customers as well, Harris said. Building an online presence is also im-

portant to Chris Geer, owner of UrbanAmericana, a vintage and antique furnitureshop in the Zafaria District on CoronadoAvenue between East Anaheim Street and14th Street. Geer said he has spent a lot of time on

social media promoting his business. In ad-dition, he has listed several items for saleon eBay.com and etsy.com to not only sellthe items but to also drive traffic, particu-larly from other states, to his store’s web-site, which has thousands of items for sale.Though summer months are expected to

be slower than winter months for his busi-ness, Geer said, since opening last year, his


Heather Duncan is the owner ofBlue Windows,

a “lifestyle store”that sells clothing,

jewelry and accessories at

5276 E. 2nd St. in Belmont Shore.

Susanne Lee, right, is the owner ofTrance on Atlantic, a women’s cloth-ing boutique at 3846 Atlantic Ave.in Bixby Knolls. Pictured with her isstore employee Tina Bone.

Dana Robertson is the ownerof Restauration, a restaurantthat serves American cuisineat 2708 E. 4th St. She ishosting a “Bluegrass Boil”for the restaurant’s one-yearanniversary on July 22.

Danny Harris is gen-eral manager ofCirivello’s RestaurantLounge Sports Bar at4115 N. VikingWay in Parkview Vil-lage in NortheastLong Beachc

Rand Foster is theowner of Finger-prints, a recordstore at 420 E. 4thSt. in the East Vil-lage Arts District.

(Photographs by the Business Journal’s Evan Patrick Kelly)

Chris Geer ownsUrban Americana,an antique and vin-tage furniture storelocated at 1345Coronado Ave. off ofEast Anaheim Street.



store has experienced “significant growth.”Though he said his store could be con-

sidered essentially an antique mall, Geeradded that he wanted to gear it more to-ward a younger crowd of customers in aneffort to get young people interested inantiques or mixing antiques with standardvintage items. What has helped business, he said, has

been collaborating with other shops, par-ticularly those on 4th Street’s Retro Row, toturn Long Beach into a “destination” forvintage. “They send people here and I do the

same,” Geer said. “We all sort of in ourstores carry this guide to vintage in LongBeach . . . If we’re going to get businessfrom L.A. and Orange County, those peopleare more likely to make the drive if LongBeach is a destination for vintage stuff.”Working with nearby businesses also

helps drive sales, he said, adding that theWorking Class Kitchen, located acrossCoronado Avenue, hosts monthly events inhis drought tolerant nursery, where they’vehosted beer gardens. “Their customers can come over and

dine at my nursery,” Geer said. “Inevitably,they’re probably going to come in and shopafterwards. So it’s great.”Creating a “sense of place” is something

that Rand Foster, owner of FingerprintsMusic, a record store at 4th Street and Lin-den Avenue in the East Village Arts Districtin Downtown Long Beach, has alwaysstrived for, he said. Moving the store from 2nd Street, where

it opened in the early 1990s, to its currentlocation five years ago has helped trans-form the section of downtown that oncehad nothing but a restaurant and an art sup-ply store, which moved across the street,Foster said. What really helped convert the space, he

said, was Berlin Coffeehouse, whichopened inside the record store’s building,and adding a “parklet” that turned what hadonce been a metered parking lot into anoutside patio area. “It really truly feels like some place you

would come down to hang out, have a cof-fee, shop and meet friends,” Foster said.“There are a lot more things to do here thenjust that sort of hit-and-run shopping whereyou drive up and go.”The record store’s location has also pro-

vided more space to host live in-storemusic events, featuring musical artists suchas Weezer, Lou Reed and Brian Wilson ofthe Beach Boys, Foster said. In addition to having regular musical

events that draw customers through thedoors, Fingerprints also relies on socialmedia and an active e-mail list that has15,000 subscribers, he said. It’s important for retailers to provide cus-

tomers with something other than what theycame in the store for, to create an overallpleasant shopping experience, Foster added. “We have benches and places to sit,

and we try to have things that are inter-esting for people who maybe weren’tthere to buy a record,” he said. “It goesback to when I was a kid and had to goshopping with my mom, and they had achair outside the dressing room. The daysof that passing for acceptable entertain-ment for the third party are gone. We’vealways strived to make sure that, if youaren’t here to shop, it’s at least a funplace to be.” �

Development Projects Underway

Or Planned InLong Beach


D evelopers are moving forward withmajor residential and commercial

real estate projects throughout the City ofLong Beach this year that are slated to sig-nificantly transform the city landscape. Some development projects are already

under construction, including a new retailoutlet mall at The Pike and new high-riseapartment buildings downtown. Other proj-ects, meanwhile, are moving through theplanning process, including a new single-family residential community planned inNorth Long Beach and a new retail centerthat has long been proposed at 2nd Streetand Pacific Coast Highway. In addition, the Long Beach Unified

School District (LBUSD), using Measure Kfunding, is moving forward with construc-tion of a new high school near Signal Hillalong with significant upgrades to JordanHigh School and two elementary schools. The following is a list of development

projects (in alphabetical order) that are un-derway or planned in Long Beach:

• Belmont Pool – The City of Long Beach ismoving forward with a $103 million project tobuild a new Belmont Beach & Aquatics Centerpool facility. City officials said it may take upto two years before construction begins as thecity has yet to release an environmental impactreport (EIR) or receive California Coastal Com-mission approvals.• Browning High School – A new thematic

high school on a 10.3-acre site surrounded byHill Street, Obispo Avenue and Redondo Av-enue near Signal Hill is under construction. Thecampus, expected to serve 800 students in 9ththrough 12th grades, with courses in tourism,recreation, hospitality and people movement, isexpected to open in fall 2016. • Civic Center – Plenary-Edgemoor Civic

Partners has been selected to take on the public-private partnership project that includes buildinga new city hall, headquarters office for the Portof Long Beach and a main library, along withapartment units, a hotel, retail and a redesignedLincoln Park. After the design phase and com-munity outreach is complete, the city expects tobreak ground in early 2016, with construction ofcity buildings to be completed in 2019.• Douglas Park – Refer to separate story on

next page. • East Division Substation –A project to build

a new East Division Police Substation at the for-mer Schroeder Hall facility that was used for theU.S. Army Reserve at 3800 E. Willow St. is ex-pected to be completed by the end of the year. • Edison Lofts –An adaptive reuse project by

Ratkovich Properties that involves converting anold city hall building at 100 Long Beach Blvd.into 156 multi-family residential units is currentlyunder construction. The city’s Long Beach De-velopment Services (LBDS) department expectsconstruction to be completed by September. • 442 W. Ocean Blvd. – Long Beach-based de-

veloper Ensemble Investments is planning a 95-unit, eight-story apartment building. The LongBeach Planning Commission approved the projecton May 21 with no appeals for local and coastal




development permits. The city is currently await-ing plan check submittals, according to LBDS. • 495 The Promenade North – The Resi-

dences at City Place – The project includes afour-story mixed-use building with 20 residen-tial units and 5,220 square feet of ground floorcommercial space. According to LBDS, theproject is currently in the plan check process forgrading and site improvements.• 4100 E. Ocean Blvd. – Olympix Fitness

Center – An adaptive reuse project to turn abuilding that once housed Yankee Doodles anda salon into a fitness center in Belmont Shore ismoving forward after the planning commissionapproved the project and denied appeals on June4. According to property owner Kurt Schneiterof Maverick Investments, construction, whichshould begin in the next 45 days, is expected totake eight to 10 months to complete. • 431 E. 6th Street – Sixth Street Lofts –

Construction is underway on a 30-unit multi-family residential complex at the corner of 6thStreet and Elm Avenue by Long Beach-basedUrban Pacific Multi-Housing, LLC. Accordingto LBDS, the city expects construction to becompleted this fall. • 433 North Pine Avenue – Construction is

underway on an adaptive reuse project to con-vert a building that once housed the Newberrydepartment store into a 28-unit residential com-plex with ground floor retail. • 4210-4280 Long Beach Blvd. – Santa Ana-

based Red Mountain Retail Group (RMRG) hassubmitted plans for retail development at LongBeach Boulevard and San Antonio Drive on asite formerly occupied by a Ralph’s grocerystore. Trader Joe’s is relocating to the site fromits current Bixby Knolls location. In addition,Pet Food Express and Crunch Fitness havesigned leases. RMRG is seeking tenants for fourspaces and expects construction to begin in Au-gust with tenants opening in early 2016. • Golden Shore Master Plan – The planning

commission approved a development agreementfor residential condominiums, office, retail,hotel and parking space on a 5.87-acre site onthe south side of Ocean Boulevard at GoldenShore on June 4. The city council is expected toconsider the proposal at its meeting today, July7. The proposed project was originally broughtforward in 2007 prior to the Great Recession. • Jordan High School – The second phase of

a $143.8 million renovation to David Starr Jor-dan High School located at 6500 Atlantic Ave.continues this year. Construction, which in-cludes building new classrooms, new athleticfields and an outdoor swimming pool, is ex-pected to be fully completed in 2021. • Newcomb Academy –The $46 million proj-

ect includes a complete renovation to NewcombK-8 Academy’s 50-year-old campus at 3351 ValVerde Ave. in East Long Beach. LBUSD ex-pects the project to be completed in August. • North Neighborhood Library – Construc-

tion of a new North Neighborhood Library inNorth Long Beach that replaces the Art Deco-

style Atlantic Theater, which was demolishedin January 2014, is scheduled to be completedthis year. The new library will be a state-of-the-art, 24,655-square-foot, single-story facility at5870 Atlantic Ave. • 150 W. Ocean Blvd. – Oceanaire – Lennar

Multi-family Communities is planning to build a216-unit apartment complex adjacent to theOcean Center building at 110 W. Ocean Blvd. Theplanning commission approved the seven-storyproject on May 21. The city is currently awaitingplan check submittals, according to LBDS.• 1570-1598 Long Beach Blvd. – The project

includes building a 36-unit condominium com-plex with 10,000 square feet of ground floor re-tail space near the Poly Academy of Achieversand Leaders high school at the southeast cornerof Long Beach Boulevard and 16th Street. Theplanning commission approved the project onJune 18. The city is currently awaiting plancheck submittals, according to LBDS.• 110 Pine Ave. –The 13-story Security Pacific

National Bank Building, under new ownership,will retain its current use as office space. Thebuilding will be converted into creative offices in-stead of a multi-family residential complex as pre-viously proposed. The city, however, has yet toreceive a new application, according to LBDS. • 110 W. Ocean Blvd. – The adaptive reuse

project proposed by property owner Santa Mon-ica-based Levy & Associates includes convert-ing the Ocean Center office building at thesouthwest corner of Pine Avenue and OceanBoulevard into a residential complex withground floor retail. According to LBDS, theproject is currently in the plan check process. • 124 Linden Ave. – Off Broadway –The proj-

ect includes three stories of apartment loftsabove 2,688 square feet of retail and a parkingstructure. The complex will feature mezzanineinteriors and provide resident access to a rooftopcommon area. The project is entitled under theDowntown Plan; however, no date has been setfor construction documents, according to LBDS.• Parc Broadway – The project includes

building a 222-unit apartment complex at 245W. Broadway, the site of a former state officebuilding. According to LBDS, the site is still inthe land clearance phase. The project requiresthe relocation of an eight-foot-diameter stormdrain underneath the property. • Riverwalk –A residential development proj-

ect on a 10.56-acre parcel at 4747 Daisy Ave.,which was formerly the site of the Will J. ReidBoy Scout Camp, proposes subdividing theproperty into a gated residential communitycontaining 131 single-family homes. The com-ment period for a draft EIR on the project by Or-ange County-based developer IntegralCommunities ended June 18. Responses tocomments are currently in progress, accordingto LBDS.• Roosevelt Elementary School – A $49.6

million project involves completely rebuildingthe campus, which is one of the largest and old-est elementary schools in LBUSD at 1574 Lin-den Ave. LBUSD expects the project to be

completed this fall. • 2nd + PCH –The planning process is under-

way for a new retail center to replace the agingSeaPort Marina Hotel at the corner of 2nd Streetand Pacific Coast Highway overlooking Alami-tos Bay. The proposed Shoppes at 2nd+PCHwould include 216,000 square feet of retail and29,000 square feet of restaurant space. The com-ment period for a draft EIR on the project is ex-pected to start late summer or early fall,according to LBDS.• Shoreline Gateway –The two-phased project

by Anderson Pacific, LLC at Ocean Boulevardand Alamitos Avenue includes a 17-story build-ing, The Current, now under construction that in-cludes 223 luxury apartments. An adjacent secondbuilding, a 35-story condominium tower, willbreak ground after the first phase is completed.According to LBDS, the west tower is under con-struction and estimated to open in early 2016. • The Ocean View Tower – The 102,356-

square-foot building at 200 W. Ocean Blvd.,formerly occupied by Verizon, is being con-verted into creative office space by MilanCapital Managment. The building has beengutted, but a timeline to move forward hasn’tbeen announced.• The Pike Outlets – A project by property

management firm Developers Diversified Re-alty Corp. (DDR) includes completely renovat-ing the facade and redesigning walkways. AfterH&M recently opened, other new tenants toopen in fall are Nike and Forever 21. DDR ex-pects the redevelopment work to be completedthis fall as well, with tenant fit-outs continuingthrough 2016. • The Queen Mary – The city has been meet-

ing with Garrison Investments, the ship’s oper-ator and adjacent land leaseholder, to develop atimeline and process for creating a new masterdevelopment. A new task force is expected tokick off the community outreach process whileproviding feedback. The 43.38 acres that sur-round the ship include the Queen Mary EventsPark, parking lots and the Sea Walk Village, aswell as other vacant land. • 3399 E. Willow St. – Hooman Toyota of

Long Beach is relocating from its current lo-cation at the Traffic Circle to Redondo Avenueand Willow Street where a new, state-of-the-art dealership is under construction. Accord-ing to LBDS, the project is about 20 percentcomplete. The site previously housed a Cadil-lac dealership. • 2533 Lakewood Blvd. –A new single-story

10,877-square-foot retail building for two ten-ants is under construction just south of Lake-wood Boulevard and Willow Street behind aShell gas station. According to Alex Kang ofSatoh Brothers International, a Dunn-EdwardsPaints shop has signed to take one of twospaces. Kang expects the entire project to becompleted in early August.• 250-270 Pacific Ave. – Pine Square/Pa-

cific Court – The project involves convertingthe former AMC Pine Square movie theaterspace into 69 apartment units with 112,079

square feet of new residential space in two lev-els. The existing 142 residential units will re-main as well as existing retail spaces on PineAvenue, 3rd Street and Broadway. The projectis currently under construction.• 228 E. Broadway – American Hotel – The

adaptive reuse project includes creating amixed-use structure and completely restoringthe existing façade and shell of the historicbuilding, with 7,000 square feet of new creativeoffice space on the second and third floors andapproximately 3,670 square feet of retail spaceon the ground floor. LBDS expects constructionto be completed in fall. • 207 Seaside Way – The project by Long

Beach-based developer Ensemble Investmentsinvolves building a 113-unit residential multi-family complex behind The Breakers. The plan-ning commission approved the project on May21. The city is currently awaiting plan checksubmittals, according to LBDS. �

New Retail Center And

More Corporate Headquarters Coming To

Douglas Park� By SEAN BELK

Staff Writer

A new 26-acre retail center with a hoteland three new corporate headquarters arescheduled to break ground this year as thelatest additions to Long Beach’s DouglasPark, considered one of the last prime piecesof commercial real estate in L.A. County.Irvine-based developer Sares Regis

Group (SRG) bought 194 acres of the mas-sive Douglas Park property, which had longbeen used for aircraft manufacturing, fromBoeing Realty Corp. in 2012. The BoeingCompany had been downsizing operationsfor years, while relocating its commercialactivity to other states. In the last three years, major tenants have

taken up space at the burgeoning new busi-ness district located off Lakewood Boule-vard just north of the Long Beach Airport. “The activity has been great,” said

Larry Lukanish, senior vice president ofSRG’s commercial development, in aphone interview with the Business Jour-nal. He confirmed that approximately 60acres of land already entitled with the city




for retail, office, industrial or hotel use re-main to be developed. SRG has already developed and sold a

collection of headquarters/distributionbuildings called Pacific Pointe at DouglasPark, totaling 677,000 square feet. Allseven buildings were either leased or soldwithin one year, SRG states. One of those buildings was taken up by

Virgin Galactic, which is owned by billion-aire Richard Branson. In March, the com-pany opened a 150,000-square-foot facilityat Pacific Pointe to manufacture itsLauncherOne satellite launch vehicle. Across Lakewood Boulevard, Mercedes

Benz USA moved into a 1.1-million-square-foot space converted from two air-craft hangars that were once home to theDouglas Aircraft Company, later becomingthe Boeing 717 aircraft manufacturing siteuntil it closed in 2006. The hangars now house Mercedes Benz’s

West Coast regional facility, employingabout 200 people at its vehicle preparationcenter and training offices. The automakersigned a 15-year lease with SRG for the 52-acre facility in a deal worth more than $100million, according to SRG. Next month, work is scheduled to be

completed on a new 137,000-square-footcampus for automotive trade school Univer-sal Technical Institute (UTI), with classesset to open in August, Lukanish said. UTIis leasing the building from SRG for admin-istration and classroom space for about 800students and more than 80 faculty and staff.In addition, Long Beach-based Urbana

Development recently completed two med-ical office buildings totaling 90,000 squarefeet on five acres. SRG also sold two acresof property to Signal Hill-based 2H Con-struction, which is planning to build indus-trial facilities on speculation totaling40,000 square feet. Another new occupant to the park is Shi-

madzu, a precision aircraft instrumentsmanufacturer, which relocated from Tor-rance to a 53,000-square-foot building thatwas completed late last year. Also, Nautilus International Holding Co.,

parent company of Metro Ports, is relocatingits headquarters from Wilmington to a new40,000-square-foot building at DouglasPark. Lukanish said the new headquartersshould be completed by the end of the year.The next major phase of development at

the park involves the construction of threenew corporate headquarters at a new com-plex called Pacific Pointe East, which willbe located on Lot D, just south of the Mer-

cedes Benz facility. The property currentlyserves as a 25-acre parking lot off Lake-wood Boulevard. SRG plans to break ground on the head-

quarters-style distribution facilities inSeptember, Lukanish said. Totaling about470,000 square feet, the buildings arebeing constructed for lease and are ex-pected to range in size from approxi-mately 110,000 square feet to about230,000 square feet, according to SRG’spublication to investors and partners. “Demand for facilities continues to grow

along with the economy,” Lukanish said inthe publication. “South Bay already was atight market when we bought the land. Withdwindling options for large buildings, com-panies and developers see our commerciallots in Long Beach as the last chance forprime land in Los Angeles County.”Lukanish told the Business Journal that

the new Pacific Pointe East buildingswould be sold on a speculative basis as in-dustrial property, which is in high demandright now since there is no standing inven-tory of new buildings.“Pacific Pointe East will be a speculative,

industrial-kind of corporate headquartersfacilities for us,” Lukanish said. “We thinkthere’s a lot of demand in that area for build-ings . . . It’s a very constrained inventory ofproduct. There is very little standing inven-tory, and the inventory for brand new, ClassA buildings, as much as we’ve built, is zero.Every new building gets leased or sold.”As for the office real estate market,

users are primarily calling for build-to-suits and are buying property for their ownaccounts, he said, adding that few devel-opers are breaking ground on speculativeoffice buildings because there are morevacancies on the market. Another new major development includes

a 26-acre retail center to be called The Vil-lage at Douglas Park, with restaurants, shopsand at least one hotel at the corner of CarsonStreet and Lakewood Boulevard. In March,SRG announced that Newport Beach-baseddeveloper Burnham USA Equities, Inc.,signed off on the purchase of the acreage todevelop the new retail center.Lukanish said Burnham USA, which is

a partner of the South Coast Collection(SoCo) in Costa Mesa known for its hipcollection of restaurants, boutiques andhome-décor stores, is currently workingon plans for the retail center, and seekingtenants. He said the developer is expectedto break ground on the retail center by theend of the year. �



joint replacement now

Available Through robotic SurgeryBy ramy elias, M.d. and Andrew j. Wassef, M.d.

Millions of successful total knee and hip joint replacements have been completedusing standard techniques without the use of advanced robotic assistance. However,

new technological advancements have now allowed orthopedic surgeons to bring robotictechnology into the operating room.Robotic-assisted surgery isn’t a new concept; the da Vinci® Si™ Surgical System has

been available for cardiothoracic and gynecologic surgeons for a decade. But robotic-as-sisted surgery just recently became an option for orthopedic surgeons and their patients. MAKOplasty® is the first robotic-assisted surgery of its kind in orthopedics. It assures

that the procedure is done with exact precision and takes away the factor of human error.Orthopedic surgeons can formulate a plan preoperatively using CT scan-based imagesand perform the surgery with pin-point precision. The plan ensures that the robot is pre-calibrated to the millimeter, which leads to better placement of implants and components.During the surgery, live feedback allows the surgeon to make the critical decisions nec-essary to have the best possible outcome.

Total Hip Replacement –Total hip replacement surgery is one of the most successfulsurgeries in history, allowing people to stay active and relieve their arthritic-associatedpain. The use of robotics in orthopedic surgery has significantly decreased two of the mostcommon complications after total hip replacement: dislocation and leg length discrepancy. Dislocation following total hip replacement can be preventable. MAKOplasty® gives

surgeons real-time feedback on the leg lengths and overall symmetry compared to theother leg. In addition, surgeons can measure exactly how much cartilage and bone to re-move in order to place the correctly sized prosthesis without losing any unnecessary bone.

Partial Knee Replacement – Historically, partial knee replacements weren’t recom-mended by many orthopedic surgeons – instead, it was suggested that the patient wait untilthe pain becomes completely unbearable. MAKOplasty® technology is single-handedly shift-ing the culture of this thinking.Rather than waiting until the entire knee is completely arthritic, the trained MAKOplasty® or-

thopedic surgeons are using this new robotic technique to help people sooner, by doing partial re-placements, rather than waiting for a total replacement in a few years. MAKOplasty® uses the RIO® Robotic Arm Interactive Orthopedic System to perform partial

knee resurfacing. This provides surgeons precision to resurface only the diseased portion of theknee, retaining as much of the natural knee as possible – including healthy bone and ligaments. Apartial knee replacement can allow the patient to get excellent pain relief while having a speedyrecovery. It also is an excellent surgery for the very active and athletic person who has suffered aninjury to one area of the knee. Studies have shown that a surgeon is three times more accurate with the use of the robotic

system when compared to conventional techniques. The utilization of robotics in surgery willcontinue to increase as the development and knowledge of these systems proliferate. As sur-geons strive to perfect the art of total joint replacements, the use of MAKOplasty® can onlyincrease their ability to obtain excellent results while decreasing complications.

(Ramy Elias, M.D., and Andrew J. Wassef, M.D., are with the MemorialCare Joint

Replacement Center at Long Beach Memorial Medical Center.)

Why Your Culture Must Be

Part of Business Strategy

What is the purpose of your organi-zation? What do you want to be

known for – both inside and outside yourcompany? You might not have a Depart-ment Of Culture Development, yet thedevelopment of culture should be a clearand compelling goal that saturates yourentire organization, whether you are aprofit or nonprofit entity.

Culture needs to be tied to the organization’s purpose ina way that creates alignment with your game plan. Thereneeds to be cultural evangelists within your organizationthat helps people stay connected to the vision. If this is notintentional you run the risk of having a culture that will ei-ther slow down or contradict where you want to go.Organizational culture could be likened to a personal rep-

utation. As we exist together we develop a reputation –

something unspoken but strongly present. A poor reputationcan be at best, unpleasant, and at worst, poison to those whoare exposed. Culture, can either repel or propel employees,customers, partners, and prospective hires.Your culture goes far deeper than just keeping employees

happy. It’s connected to your strategy. And it’s there whetheryou are aware of it or not. So make sure it’s the one you want.How is this done? It happens by establishing communi-

cation at every level of your organization – both up anddown and across all departments; i.e. throughout the entiresystem. It’s real time feedback describing current reality, notsome far off aspiration. This is how you learn what your cul-ture is. You can’t be intentional without this information.You can’t get to where you want to go if you don’t

know where you are.Culture is made up of the thoughts, beliefs, attitudes,

and actions that happen by default unless you are inten-tional about changing it.The good news is that when this is clear you now have

criteria for hiring the right people who fit the culture youwant. They might be highly talented, but if they don’t fitthe culture, more damage than good will be done.Culture is also one of the great levers that help your

organization accomplish its objectives. With the rightculture your mission, vision, and core values will be en-hanced. It’s powerful like the current in a river. It movesthings. It’s a driving force.

Culture also informs and guides the progression path ofpeople in your organization. How are they viewed? Isthere a growth path that is also aligned with the company’svalues? Does your workforce see your organization valu-ing both people and results? Is the organization interestedin the individual’s well-being and personal mastery.Culture also helps the organization and the individuals

in it accomplish their dreams. There should be alignmentin the aspirations of the company and the employees. Itis powerful in keeping everyone aligned with the vision.It breeds effective communication up and down the chainof command. It ensures the best care for your greatestasset – your people.And here’s the payoff. Culture connects the individual

to the strategic plan. Each person feels like a strong con-tributor impacting the big picture.The results:• Alignment – everyone going in the same direction• Attunement – an emotional connection as you tap

into people’s passions.• Action – alignment informs what people think, and

attunement provides motivation and energy to act.Is your culture a part of your business strategy?(Mick Ukleja keynotes on topics related to leadership

and personal productivity. He’s president of Leadership-Traq, and author of several books. Check his weekly blogat www.leadershiptraq.com.)

HealthWise

By MiCk

UklejA

Finding The right Credit

Solution For Your Business

One-third of business owners say they use their own funds or per-sonal credit for their business. Yet as a business seeks to grow, ob-

taining business credit is essential and can help finance purchases, builda credit history, supplement cash flow and preserve savings. How do you choose the right credit solution for your business? Not

all financing options are created equal. The type of business credit youneed depends on your business goals and how much funding you need.Need a way to pay for everyday business expenses? When a busi-

ness owner is looking for a convenient way to pay for everyday busi-ness expenses, business credit cards can be a good solution because business ownerscan separate business from personal expenses and immediately pay for day-to-daybusiness expenses. Businesses also can obtain multiple cards for employee use. Thereare many cards on the market, so it’s a good idea for business owners to research theiroptions, and evaluate card features – from fees to spending controls to rewards – tofind the one that best fits their needs.Need to make large seasonal purchases or cover payroll? Nearly every small business

will face a time when it needs more cash than it has on hand. A business line of credit canprovide fast, easy access to cash, which can bridge gaps and help supplement cash flow. Unsecured and secured credit options are available. For unsecured credit solutions,

the most common type of credit, a business owner typically borrows based on personaland business credit history and cash flow. Secured credit solutions are another optionthat can help newer businesses establish business credit and assist businesses that mayneed to rebuild their credit. With a secured credit solution, the cardholder or borroweruses a deposit account or assets as collateral to secure the credit.Want to expand your business or make a large equipment or vehicle purchase? For

a specific business need, business term or equipment loans should be considered.Loans give businesses immediate access to funds and are ideal for business ownerswho want a flexible way to get a lump sum at a fixed or variable interest rate for afixed period of time. There are many types of loans, including unsecured loans, securedequipment loans, real estate loans and vehicle loans, and rates and terms vary. When evaluating lending options, you should also consider an SBA loan. Through

government-guaranteed SBA loans, financial institutions are able to extend financingto a segment of creditworthy small business owners who may not be able to obtain aconventional loan or loan terms that meet their business needs. Business owners whoare looking to buy real estate, acquire a new business or purchase equipment may findthat an SBA loan offers more flexible terms than a conventional loan. SBA products in-clude the SBA Express line of credit, and SBA 7(a) and SBA 504 loans.Every business has unique needs and goals. As business owners consider their credit

options, they should consult with a banker to determine the best solution to meet thespecific needs of their business.(Ben Alvarado, a 23-year veteran of Wells Fargo, is the president of the bank’s

Southern California Region, which stretches from Long Beach to Orange, Imperialand San Diego counties.)

Small Business Dollars & SensePERSPECTIVE

Effective Leadership

By Ben

AlvArAdo



Commercial loan restrictions

Could dampen Market

Financing on any level is much harder intoday’s world considering the economic

changes of the last decade, but new guidelinesfor commercial construction lending is poisedto both dampen the market for new develop-ment while also sending this segment awayfrom traditional banking sources and into thearms of other types of lenders.

The new regulations, released by regulators on March 31, arealso forcing many projects to either be abandoned altogether orto find investors to bridge the gap and forego financing in thetraditional sense. New lending requirements that went into effectthis year called Basel III created a new category of acquisition,development and construction loans that regulators call HighVolatility Commercial Real Estate. Such loans face a 150 per-cent capital requirement that is making construction loans moreexpensive and forcing developers to go to nonbank lenders, ac-cording to lending officials.“It doesn’t make sense," said Thomas Bisacquino, the presi-

dent and chief executive officer of the National Association ofIndustrial and Office Properties, which lobbies on behalf of thecommercial real estate development industry. “You are movingthe better loans out of the banking system.”Regulators added the higher capital charge because of their

experiences during the financial crisis. A Federal Deposit In-surance Corp. study found that many banks that failed duringthat period held large concentrations of acquisition, develop-ment and construction loans. A common problem was that, bythe time construction of new properties was completed, therewas low demand for them.The new capital rules are designed to force borrowers to have

more skin in the game. They must meet a 15 percent equity re-quirement to avoid the High Volatility designation. The leverageon the loan also cannot exceed 80 percent of the estimated com-pleted value of the project.But lenders said these rules don’t recognize certain realities

in the real estate market. For example, the requirements do not

recognize the appreciated value of the land in determining howmuch equity the developer has to bring to the table.For builders who have held land for a number of years, they

will not get credit for appreciation in determining their equityin the project, which is going to be a deal breaker in many cases.Many developers buy and hold raw land for future projects.

“They hold a piece of dirt for 3, 5 or 20 years,” Bisacquino said.“This new regulation says they have to use the original basis ofthe land. It is insane.”Regulators are also now requiring that construction loans be

held for their full term, another deterrent to using traditionalbanking sources for these types of loans. Under the new BaselIII requirements, a “high volatility” construction loan can’t beconverted to permanent financing until it is held for the full termof the loan. For instance, in the case of a four-year loan whereconstruction is completed in two years and the project is con-sidered “cash flowing,” regulatory guidelines dictate that theloan must still be held for the full four-year period, somethinglenders say is unnecessary.Another new requirement prevents the developer from taking

any equity or funds internally generated by the project until con-struction is complete and converted to permanent financing,thereby eliminating any use of the cash flow generated to paytaxes or other expenses. This also increases the capital require-ment for developers going into a project.The regulators used to consider all construction loans in the

100 percent risk-based capital category. The higher 150 percentrisk weighting “will put a damper on [high volatility] lending,”said Hugh Carney, vice president for capital policy at the Amer-ican Bankers Association.The higher capital requirement will be reflected in the price

of loans, and put banks at a competitive disadvantage to non-bank lenders, Carney added.“If borrowers are able to get better pricing elsewhere, these

loans may not be done by the banking system,” he said.In their effort to take the risk out of construction lending, reg-

ulators have done the opposite, some industry representativeswarn. The rules effectively encourage banks to focus on B-gradeprojects so they can charge a higher interest rate and increasetheir return on capital.The end result will make development more difficult and ex-

pense, and will require more investor participation into projectsto bridge this lending gap.(Terry Ross, the broker-owner of TR Properties, will answer any

questions about today’s real estate market. E-mail questions to Re-alty Views at [email protected] or call 949/457-4922.)

By TerrY roSS

Realty Views

It’s not uncommon fortrade-related profes-

sionals, who may disagreeon any number of issues,to find common groundon one key thing: the U.S.suffers by not having a na-tional freight strategy.

Truckers, rail companies, port labor – thatis to say anyone working along the supplychain – recognizes that the ability to com-pete as a leading trade nation dependsupon consistent policies, the developmentof clearly defined priorities, and constantattention to the state of the infrastructureon which the goods move. The latter alsodepends upon a regular funding stream.While shared consensus on the problems

at hand - if not the solutions - is only half thebattle, it’s certainly a start. And it’s in partthe purpose behind Beyond Traffic, which isthe title of both a report and an initiativelaunched by the U.S. Department of Trans-portation earlier this spring. Beyond Trafficadvertises itself as “an invitation to the

American public—including the users, de-velopers, owners, and operators of the trans-portation network and the policy officialswho shape it – to have a frank conversationabout the shape, size, and condition of thatsystem and how it will meet the needs andgoals of our nation for decades to come.”The report is a draft survey of major forces

impacting transportation. It attempts to sep-arate fact from fiction when it comes to ourunderstanding of the state of the transporta-tion system in this country. The initiative onthe other hand is actually an Internet-drivendialogue focusing on the potential solutionsneeded to address those forces. It engages allof us as problem-solvers, seeking input onadditional trends impacting the movement ofpeople and goods as well as policy options.It also asks for answers to questions that in-clude not only how we move things but howwe can move things better, how do we adaptand how do we align decisions and dollars.The input received on the draft report will beused in the preparation of a final documentto be released later this year.Beyond Traffic does a good job painting

a picture of the external forces influencingthe demand for different kinds of trans-

portation services. These include thegrowth of megaregions, which are ex-pected to become home to three-quartersof the US population by 2045. The reportalso analyzes changing needs resultingfrom generational and demographic trendsincluding an aging population.Secretary of Transportation Anthony

Foxx has been on the stump talking aboutBeyond Traffic. He’s frank about the short-comings and dysfunction of our currentmodel for planning, funding and imple-menting our transportation network. Forone thing, it’s hard to be strategic when thesystem lives or dies with unreliable and in-consistent short term funding fixes andcontinuing resolutions. We’ve had 32 ofthem in the past six years. And by not beingstrategic, we can only react to hot spots, notanticipate the changes coming ahead.For freight, those changes are likely to

be significant. Beyond Traffic predicts a45% increase in volumes by 2045 andpoints to other dramatic shifts in the econ-omy that will change the nature of howand why people use transportation. Theseshifts include an increase in “last mile”home deliveries due to increasing onlineand m (or mobile) commerce, increasedcongestion around major airports resultingfrom airline mergers and the consolidationof hubs, and congestion at other majortrade gateways like ports and border cross-

ings thanks in part to increasing vesselsize but also the development of megare-gions which creates the demand for thegoods in the first place. Even the hopes ofone of the country’s economic brightsports – domestic energy production –could remain unfulfilled without carefulattention to that sector’s infrastructure.The report recognizes the limitations of

the federal government in responding to allof these challenges. And given the fact thatthe USDOT is in fact-finding mode at thisstage of the initiative, the Beyond Traffic re-port doesn’t pretend to offer a path forward.The final report, which will respond to bothexpert opinion and general comments, mayyet provide something closer to a blueprint.And as we know, with plans the devil is inthe details. But it seems like a worthwhileexercise (and appropriate) for USDOT toserve as a convener of disparate stakeholdersand facilitate the development of new ideasin the hopes of creating guiding principlesthat demonstrate the country’s commitmentto a world-leading transportation system. Access to the report can be found at

http://www.transportation.gov/BeyondTraffic(Dr. Thomas O’Brien is the executive di-

rector of the Center for International Tradeand Transportation at CSULB and an asso-ciate director for the METRANS Trans-portation Center, a partnership of USCand CSULB.)

EDITOR & PUBLISHERGeorge Economides

SALES & MARKETING EXECUTIVEHeather DannSTAFF ASSISTANTLarry Duncan

EDITORIAL DEPARTMENTSENIOR WRITER

Samantha Mehlinger STAFF WRITER

Sean BelkCONTRIBUTING WRITER

Thyda Duong, Michael Gougis, Gerrie SchipskePHOTOJOURNALISTEvan Patrick KellyCOPY EDITORPat Flynn

The Long Beach Business Journal is a publication ofSouth Coast Publishing, Inc., incorporated in the Stateof California in July 1985. It is published every otherTuesday (except between Christmas and mid-January)– 25 copies annually. The Business Journal premieredMarch 1987 as the Long Beach Airport Business Jour-nal. Reproduction in whole or in part without writtenpermission is strictly prohibited unless otherwisestated. Opinions expressed by perspective writers andguest columnists are their views and not necessarilythose of the Business Journal. Press releases shouldbe sent to the address shown below.

OfficeSouth Coast Publishing, Inc.2599 E. 28th Street, Suite 212

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Vol. XXVIII No. 13July 7-21, 2015

PERSPECTIVE

Beyond Traffic


By ToM o’Brien

Trade And Transportation


36 Long Beach Business Journal July 7-20, 2015POW! WOW! LONG BEACH

POW! WOW! Painting The Town� By SAMANTHA MEHLINGER

Senior Writer

From June 22 to 27, artists trans-formed highly visible buildingsthroughout Long Beach with perma-nent outdoor murals as part of POW!WOW! Long Beach, a weeklong event

focused on engaging the community “inthe process and creation of art,” accord-ing to event organizers.POW! WOW! originated in Hawaii

and “has grown into a global networkof artists and organizes gallery shows,lecture series, schools for art and music,creative community spaces, concerts,

and live art installations across theglobe,” according to the POW! WOW!Long Beach website. The principalPOW! WOW! event takes place duringValentine’s Day weekend in Honoluluand attracts hundreds of artists.Founded by Jasper Wong and co-di-rected by Kamea Hadar, “the festival is

expanding to cities and countries suchas Long Beach, Taiwan, Israel, Singa-pore, Jamaica, Washington D.C., Guam,New Zealand, Germany and manymore,” according to event organizers.Several murals were painted on

walls of Long Beach buildings by in-ternational, national and local artists,

At left: PUSH, a California artist, paints a mural from a cherry picker on the side of the Expo Arts Center building in Bixby Knolls as part of the weeklong event, POW! WOW! Long Beach. Pictured in the foregroundfrom left are: Imprint Venture Lab’s John Hall, a POW! WOW! Long Beach director; POW! WOW! Co-lead Director Kamea Hadar; 8th District Councilmember Al Austin; Bixby Knolls Business Improvement AssociationDirector Blair Cohn; and POW! WOW! Founder and Lead Director Jasper Wong. At right: The opening reception for the Long Beach Museum of Art’s “Vitality And Verve: Transforming The Urban Landscape” exhibition,held as part of POW! WOW! Long Beach, drew more than 3,000 people. The exhibit, available for viewing through September 28, features murals from visiting urban artists painted directly on museum walls.

36 Long Beach Business Journal July 7-20, 2015POW! WOW! LONG BEACH

POW! WOW! Painting The Town

Before



At right: The design for this mural on the side ofthe historic The Varden Hotel (pictured above, be-fore and after, as well) hearkens to the hotel’s 80-year history, depicting figures and images with avintage feel. Pictured from left are: The VardenHotel owner Larry Black; 1st District Councilmem-ber Lena Gonzalez; and artist Tristan Eaton.Below: Long Beach artist Jeff McMillan’s finishedmural livens up a once blank wall between theLong Beach Convention & Entertainment Centerand the Hyatt Regency Long Beach. The muralwas created as part of POW! WOW! LongBeach. Pictured, form left, are: McMillan; POW!WOW! Co-lead Director Kamea Hadar; POW!WOW! Founder and Lead Director Jasper Wong;Vice Mayor Suja Lowenthal; and Long BeachConvention & Entertainment Center General Man-ager Charlie Beirne.

including France’s Fafi, Germany’sLow Bros, Austria’s Nychos andAaron Horkey of Minnesota. Califor-nia artists included Aaron De LaCruz, Benjie Escobar, Bumblebee,Cryptik, Hueman, James Jean, JeffMcMillan, Jeff Soto, Madsteez,PUSH and Tristan Eaton.Mostly concentrated in Downtown

Long Beach, finished mural locationsinclude The Varden hotel, the LongBeach Convention & EntertainmentCenter, the former City Hall East build-ing (currently being transformed intothe Edison Lofts), the Expo Arts Centerin Bixby Knolls and others.In addition to transforming the Long

Beach landscape with art, POW!WOW! Long Beach also brought sev-eral events to the city, including musicconcerts, a film screening and lectures. On June 26, the Long Beach Mu-

seum of Art (LBMA), a co-sponsor ofPOW! WOW!, debuted its exhibition,“Vitality and Verve: Transforming theUrban Landscape,” featuring works ofvisiting artists painted on the museum’sHartman Pavilion walls. “Vitality andVerve aims to illuminate the sensoryvalue and powerful practice of theseartists as they transform the urban land-scape around them,” a POW! WOW!statement explained. The event featuredlive music, dancing and refreshments,and attracted more than 3,000 people –the biggest opening reception in themuseum’s history. The exhibit remainsthrough Septebmer 28. �

After


At right: The design for this mural on the side ofthe historic The Varden Hotel (pictured above, be-fore and after, as well) hearkens to the hotel’s 80-year history, depicting figures and images with avintage feel. Pictured from left are: The VardenHotel owner Larry Black; 1st District Councilmem-ber Lena Gonzalez; and artist Tristan Eaton.Below: Long Beach artist Jeff McMillan’s finishedmural livens up a once blank wall between theLong Beach Convention & Entertainment Centerand the Hyatt Regency Long Beach. The muralwas created as part of POW! WOW! LongBeach. Pictured, form left, are: McMillan; POW!WOW! Co-lead Director Kamea Hadar; POW!WOW! Founder and Lead Director Jasper Wong;Vice Mayor Suja Lowenthal; and Long BeachConvention & Entertainment Center General Man-ager Charlie Beirne.

POW! WOW! LONG BEACH

(Photographs by the Business Journal’s Evan Patrick Kelly)


ART MATTERSBrought To You By The Arts Council For Long Beach • www.artslb.org

Long Beach Business Journal 38July 7-20, 2015

Gallery Corner Sound and Vision is a 40-year retrospective of multimedia artist, Teressa Longo, at the Cultural Alliance of

Long Beach (727 Pine Ave). Longo graduated from the film department at Massachusetts College of Art and

has worked in Long Beach for more than 14 years.

This exhibit will be an interactive experience with

custom-made soundscapes to accompany images

that have been shot over four decades. “I know what

impact and impressions can be generated and expe-

rienced by the manipulation and conjunction of film

with sound,” Longo said. Opening reception: July 11,

6–9 p.m. Closing reception: July 26, 12–5 p.m. Free

workshop: July 8, 12–4 p.m. (all materials included

and registration required). Art created during the

workshop will be exhibited at the closing reception.

For more information and for workshop registration,

call CALB at (562) 436-3421.

The Arts Council for Long Beach

launched a new, redesigned website on

July 1st, as well as an Indiegogo cam-

paign to raise money for artist microgrants!

The Arts Council is a private 501(c)3 nonprofit

that helps fund, market and advocate for the

arts in Long Beach.

Fund Artist Microgrants & Get Rewarded

The Indiegogo crowdfunding effort raises

money for the Arts Council’s popular monthly mi-

crogrant program. All money raised will go di-

rectly to artists and arts organizations – 100%!

The more money raised, the more art Long

Beach communities receive.

Every level of donation brings a fantastic re-

ward from a local sponsor: Fingerprints, Univer-

sity Art Museum, Long Beach Art Theatre, Lyon

Art Supply, Primal Alchemy, Yellow 108, Long

Beach Playhouse, Fox Coffee House, The

Garage Theatre, Belmont Music Studio or

MADE in Long Beach!

Arts Council microgrants have supported 29

projects so far this year around the city – from

music to dance, visual arts to cultural festivals,

and beyond – programs that make Long Beach

a vibrant and exciting place to live.

Donors support a great cause, get a tax break

through a tax-deductible donation and receive

awesome gifts! What’s not to love? Donate

today, and spread the word! Visit

artslb.org/news.

Visit the New Artslb.org

The Arts Council’s newly designed website (at

the same great web address – artslb.org), seeks

to serve as an excellent resource for both the

general public and artists. Designed by Down-

town Long Beach-based visualade, the site is fully

responsive and functions beautifully on desktop,

notebook, tablet and mobile devices of all types!

For the Public:

• Looking to hire a local artist to display or sell

art in your office or business – or want to buy

art for your home? Check out the Artist Registry

(artslb.org/artists) and the

Art in Available Spaces tips

(artslb.org/services/art-in-

available-spaces)!

• Looking for a fun

event? Browse the new

Calendar of Events (art-

slb.org/calendar)!

• Want to check out the

arts venues around town,

sortable by genre? The Arts

Map (artslb.org/arts-map)

is the place to go.

For Artists:

• The Artist Registry gives every Long Beach

artist a free web page to display, describe and

promote your work! Link to it to your website

and social media, or use it as your main web-

site. (artslb.org/artists)

• Apply for our annual grants or monthly mi-

crogrants (artslb.org/services/grants)

• Learn about upcoming local, regional and

national Artist Calls (artslb.org/services/artist-

calls)

• Get links to professional development and

advocacy groups (artslb.org/services/resources)

• Promote your venue on the Map

(artslb.org/arts-map)

• Promote your events on the Calendar (art-

slb.org/calendar)

Check out the new artslb.org today and do-

nate to the microgrant fundraiser to support

Long Beach arts! �

Long Beach Dragon Boat Festival CombinesChinese Culture and Community� By SARAH BENNETTArts Council for Long Beach Contributor

For more than 2,000 years, on the fifth day of the fifth moon, resi-

dents of southern China have taken to the rivers with decorated 22-

person boats, beating drums and rowing their way through

competitions in honor of the rebel poet Qu Yuan, who drowned himself in

the year 278.

Steeped in rich ceremonial, ritualistic and religious traditions, the so-

called Dragon Boat Race is emerging as one of the world’s fastest-growing

water sports.

For nearly 20 years, Long Beach has been home to one of the oldest and

most well known Dragon Boat competitions – the weekend-long Long Beach

Dragon Boat Festival at Marine Stadium, being held this year July 18–19.

“It’s a very special sport in that it’s combined with a cultural thing,”

founder Howard Chen said of Dragon Boat racing. “I don’t think any other

sport is as culturally steeped. All the people, even the Americans who do

this sport, know where it comes from. It’s a chance for others to learn about

Chinese culture.”

The sport itself now stretches beyond its Chinese roots and is practiced

by a diversity of people in more than 60 countries. The appeal, said Chen,

is multi-layered. Firstly, it’s a ‘green’ sport in that runs exclusively on human

power and does not require a field or stadium. It’s a team sport and social

activity that, in many divisions, is co-ed. It can also be relatively cheap and

easy to start your Dragon Boat career, with the only equipment required

being a paddle.

As a spectator, the barriers to entry are even less: with no rules to mem-

orize and the boats moving forward in a straight line, jump in at any part of

a race or tournament and know exactly who is winning and who is losing.

“I call it a community sport,” said Chen. “Anybody can join. And tech-

nique-wise, you can spend an hour practicing and then join.”

Chen started working on Dragon Boat tournaments in 1995, when the

San Gabriel Valley orthodontist and a friend gathered donations, rented a

few of the massive boats from Vancouver and hosted a small race at Pud-

dingstone Lake in San Dimas.

Donations from the Lions Club in Taiwan and other sources allowed the

tournament to obtain its own boats the following year. Chen formed a non-

profit around the Dragon Boat Festival and moved the tournament to Ma-

rine Stadium, where it’s been held ever since.

Today, Long Beach’s Dragon Boat Festival owns 50 boats (some of which

can be seen parked on Mother’s Beach year-round) and hosts a tournament

that draws 110 teams, as close as San Diego and as far away as China.

The races are accompanied by a cultural festival that includes tradi-

tional Chinese art demonstrations, acrobatics, dance, hip-hop, music and

martial arts.

“The festival is very special for Southern California, which has the most

diverse number of ethnic groups,” said Chen. “We’re not just emphasizing

Chinese culture anymore. It’s about combining everybody together. This is

the only sport I can think of that promotes everybody. It’s all of our com-

munity uniting together.” �

ART MATTERS to Long Beach:Arts Council Launches NewWebsite and Fundraiser for Artist Microgrants


According toBrazilian novelistPaul Coelho “theworld is changedby your examplenot by your opin-ion.” Any obser-vant individualwould take note ofthe fact that ourworld is becomingincreasingly tur-bulent and that ci-vility seems morethe exception thanthe norm. Never

was there a more important time in ourlives for examples of good leadership.We frequently express our opinionsand sometimes do so with indignation,disdain or anger. Conversely when weare attempting to set an example weare mostly on our best behavior,demonstrating patience, courage, clar-ity, dignity, excellent listening skills anda myriad of other traits that are worthfollowing. It is really quite easy to fireoff a strong opinion on a subject or anindividual, we all do it on a daily basis,but it is really quite challenging to con-sistently set a tone of cooperation, ac-ceptance, humility and grace.Personally I have always felt the harderwork is to be a leader with these char-acteristics and maintain the strength ofyour convictions and faith in achievingyour objectives even when the oddsare stacked against you.

FDR once said that the loneliestfeeling in the world was to believe thatyou are leading only to turn aroundand find no one is following! It’s noteasy work being a strong and effectiveleader because invariably it is not al-ways going to go your way and youwill make mistakes. However a belief

in long term success is a must - anability to be flexible and allow othertrusted advisors and confidants to in-form your decision making is a must.

No leader is an island and you can’tlead alone. We all need a strong sup-port group around us and in the non-profit world this becomes particularlyimportant because we rely very muchupon our volunteer leaders and staffto play an increasingly important rolein moving the organization forward.Your job, as a leader, is to direct, in-spire, motivate and ensure results butthese results only come about if wehave done a good job of communicat-ing with others what the intendedgoals are and how they can help theorganization achieve them.

Leadership by example is aboutdoing things right but more impor-tantly about doing the right thing. Asa leader you’ll need to see a little far-ther ahead than the crowd and this isoften where the term “being steadfast”may come into play because those youare leading may not see that visionand/or your persistent belief in a pos-itive outcome. Given all of the chal-lenges you may face leading anorganization it is important to remem-ber that while you are being a civil, co-operative and thoughtful leadersometimes you will need to be veryclear and direct and you must stick toyour principles. FDR told a reluctantnation on the brink of war that “therewould be losses before there would bevictories.” This was an example ofbeing truthful that allowed the nationto steel itself against setbacks that oc-curred. Sometimes leaders want toplay to the audience and gain accept-ance. However it is imperative that thetruth be told. The truth, no matter howdifficult to take, is always enough!

Leading by example also requiressome personal development and it isimportant to grow and develop your-self before you do so with others.Leading others is also a skill thatneeds to be continually honed. Em-powering others to greatness comesabout through encouragement, recog-nition and acceptance. Be slow to pun-ish but swift to reward and if you getothers to believe that they can makea difference then indeed they will.Don’t wait to become perfect beforeyou take the reins, remembering thatyou are a work in progress also. Nomatter where you are in your personaldevelopment you can always do greatthings and these will help raise you upand a rising tide does lift all boats.

It is not often spoken about in asense of leadership but I think thatlove has a strong place in a goodleader for it is in this mindset that youwill truly inspire and encourage othersand bring out the best in them. Youbetter develop a good sense of humoralso because laughter is truly the bestmedicine and often disarms particu-larly volatile situations.

In our 24/7 – 365 world, there is aconstant plethora of information com-ing at us on a daily basis: email,voicemail, news, etc. These electronicmissives always seem to need our im-mediate attention and represent dis-tractions that can immobilize ourefforts to lead effectively. The solu-tion? Take a break, get some fresh air,walk, or take meeting instead of tryingto maintain an attention span thatsometimes feels akin to that of a gnat.

Many recent studies have demon-strated the necessity of rechargingourselves and taking time out from theelectronic cacophony that buzzes inour eardrums all day long. Taking timeis really part of our very human DNA.You only have to be a casual observerof history to understand that so manygreat leaders knew when to take abreak, step back, smell the roses andclear the air. Another admirable trait ofgood leaders is that they possess ashort term memory when it comes toslights and criticisms. This is a helpfulattribute because you can’t afford toburn bridges you’ll need to rebuild oneday and your focus should be on theidea that if you don’t mind who getsthe credit the job will get done.

As a leader, you are mostly a conduitfor others and you won’t always knowwho’s really watching and paying at-tention and may not even have astrong sense of how you are influenc-ing others. So take a deep breath,

proceed with love and strength of yourconvictions, communicate openly andhonestly and empower others to great-ness. When you have done thesethings you have truly changed your or-ganization and the world for the better.

THE NONPROFIT PAGECurated By The Long Beach Nonprofit Partnership

The area’s regional capacity builder, serving local organizations to strengthenand grow through leadership, education and collaboration. Offering:

Professional Development & TrainingNetworking & Collaboration

Custom Training & Consulting ServicesInformation Resources

To learn more, visit us at www.lbnp.org.4900 East Conant St., Building O-2, Suite 225, Long Beach, CA 90808

562.888-6530

Leading By Example

Long Beach Business Journal 39July 7-20, 2015

Capacity Corner: Upcoming Calendar of Events

From the Nonprofit PartnershipEssentials of Human Resources CertificateThursdays, July 16, 2:00-5:00pm (6 Sessions)Rapidly changing workplace initiatives, legal landscapes and workplace culture are an integralpart of the human resources function. The program provides the knowledge and practical skillsfor human resources administration and management. This certificate program will focus onreal-life situations that are found in organization’s today.

Successful Project ManagementWednesday, July 29 to August 20, 2015, 9:00 am-NoonIf you're new to project management or looking for a refresher on effective project manage-ment, come learn the basics of managing projects small to large.Delivering Exceptional Customer Service from the Inside OutWednesday, August 19, 2015, 9:00am-4:00pmSuccessful organizations recognize that excellent customer service is the result of paying closeattention to interconnected interactions. Excellent service doesn’t come just from a friendlyresponse or a helpful website. It results from really understanding customer expectations andputting structures in place that will exceed those expectations at every step of their experience.Ultimately, your success is tied to the quality of the customer’s experience with you.

From our PartnersAsk the Expert: Finding Funding for Technology ProjectsJuly 23, 2015, 11:00am WEBINARIn this interactive webinar, they will examine how to make a data-informed case for technologyinvestment and explore funding sources, cost estimates, and needed resources. For more info,visit: nten.org.

Save the Date: Stronger Together Nonprofit ConferenceAugust 24, 2015 — Los Angeles, CA Join three strong partners working together on the second annual nonprofit conference forCalifornia with leading edge content and exceptional presenters in leadership, strategy, advo-cacy, and risk management. For more info, visit: calnonprofits.org.

Nonprofit NewsWelcome to . . .

• David Leonard, Executive Director,New Hope Grief Support Community• Erin Wilson, Development Direc-tor, Precious Lamb Preschool• April Economides, Director of

Marketing & Communications, ArtsCouncil for Long Beach• Megan Hanks, Director of Devel-opment, Arts and Services for theDisabled

Congratulations to . . .

• Long Beach City College Founda-tion for raising $1.5 million inscholarships awarded by LBCC onMay 29th.• Operation Jump Start’s class of

2015 graduates, they will become1st generation college studentsthis fall.• Century Villages at Cabrillo on

launching their 2015 Villages atCabrillo Social Impact Report: cen-turyhousing.org.• Women in Transition for success-fully graduating six formerly home-less women through their Women’sLeadership Development Training.• Leadership Long Beach, whichadds 78 alumni to its growing net-work in its three programs: LLBI,EQS and YLLB. • Children’s Dental Clinic for beinghonored among the top 10 non-profits in LA as a ”Champion of theGame” by Molina Healthcare.• Comprehensive Child Develop-ment for reaching their fundraisinggoal at Art of All Ages.• Urban Community Outreach forexpanding its “Rainy Day Program”to become a year-round temporary

shelter for women and families.

Farewell to . . .

• Susan K. Beeney, as shestepped down from her foundingrole as Executive Director of NewHope Grief Support Community to

welcome David.

And . . .

• Food Finders has moved to newand larger offices at 3744 N. In-dustry Avenue, Suite 401, Lake-wood, CA 90712.

Matthew Faulkner,Executive Director,Community Hospital

Long Beach Foundation


cutve vice president of college advance-ment and economic development for LongBeach City College; and Tracy J. Egoscue,an environmental attorney and former dis-trict attorney general for the State of Cali-fornia.Since Drummond was appointed to the

board in 2011 by former Mayor Bob Foster,his top priorities have been fiscal responsi-bility and building a stronger relationshipwith the city. “We had become an organi-zation that didn’t worry much about proj-ects being over budget,” Drummond said ofthe state of the port when he joined theboard four years ago. “We needed to lookat the bottom line more closely.” Although the port operates under the

city’s harbor department, the relationshipbetween the department and city hasn’t al-ways been ideal. “There were times whenour relationship with the city suffered,” hesaid. One of the causes of friction was a de-bate between the port and the city over howmuch of the port’s revenues should betransferred into the city’s Tidelands Fundfor capital improvement projects. That matter was resolved just as Drum-

mond came on the board through ballotMeasure D, which set the amount of portand oil revenues that could be put into theTidelands Fund at 5 percent of gross rev-enue. Previously it had been 10 percent ofnet revenue, which often became a movingnumber. “The issue no longer exists. It’s allvery smooth now,” he said of the port’s re-lationship with the city.When asked which harbor commission

decision made in the past four years has hadthe most impact on the port’s future, Drum-mond replied without any hesitation, “Hir-ing Jon Slangerup.” Slangerup began as theport’s new chief executive last August. “Jon Slangerup is incredibly competent,”

Drummond said. “He has been adding staffin critical positions. He is really focused onspeeding up cargo through Long Beach.”Also significant is that Slangerup hasplaced due emphasis on the importance ofgood customer relations. “He is customerfocused . . . In the past, we were kind ofpuzzled over who our customers were,”Drummond said, explaining that, in prioryears, terminal operators and shipping lineshad been regarded as the port’s main cus-

tomers. These entities, however, are trulythe port’s partners in the supply chain andport operations.The port’s customers are really the bene-

ficial cargo owners – major retailers andwholesalers who own the goods movingthrough ports, Drummond explained. “Thetrue customers are the Targets and the Wal-marts that source materials overseas, andthen they make the decision from the originall the way through to the destination[about where that cargo goes],” Drummondsaid. “We haven’t been very efficient andwe haven’t treated our true customers withsufficient respect. Slangerup is doing that.”With Slangerup in charge, the over-

spending issues Drummond had once beenconcerned with are no longer a glaringissue. Since Slangerup began, the port hasnow implemented a budget complete withgoals and objectives, Drummond noted. Hehas also helped tighten up spending forcapital improvement projects such as theMiddle Harbor Redevelopment Programand the Gerald Desmond Bridge Replace-ment Project.“I believe the port’s biggest challenges are

the bottlenecks,” Drummond said. One ofthese bottlenecks is the 710 Freeway. Severallanes feed onto the 710 from the downtownarea and the port, he noted. “Those eightlanes feed to three lanes just north of PacificCoast Highway. It doesn’t work,” he said.Drummond said the port has been workingwith the Gateway Cities Council of Govern-ments and other entities involved in a pro-posed I-710 Corridor Project to ensure thatit resolves bottleneck issues.The port’s efforts to expand its on-dock

and near-dock rail infrastructure may alsohelp alleviate some supply chain conges-tion, Drummond noted. “We are spendinga lot of money right now, some of it comingfrom federal assistance . . . to improve ourrailroad access within the port,” he said.“We have 100 miles of rail in the Port ofLong Beach. We need 200 [miles], becausewe would like to move more by train,” hecontinued. “It is less polluting and, giventhe right kind of infrastructure, it can giveus real smooth throughput.”In the future, the port may also invest

in short-haul rail to the Inland Empire,which has a growing warehousing indus-try. “That’s in the planning stage now,”Drummond said.Remaining competitive in an evolving

international trade landscape is also onDrummond’s list of priorities moving for-ward. “Our biggest challenge with compe-tition is to be able to bring goods here inthe most economical fashion from the ori-gin to the destination,” he said. A widened Panama Canal is slated to

open in August, leading some to speculatethat some cargo usually destined forSouthern California ports may insteadpass through the Panama Canal. “Now,with the Panama Canal almost finished . .. there is a lot of thought or belief that [theports of] Savannah and Charleston andsome of the eastern ports will competewith us,” Drummond acknowledged. “Itruly believe that is mistaken.”It costs more to ship to these ports from

Pacific Ocean routes simply because thedistance is farther, which necessitatesmore fuel, Drummond noted. Addition-ally, the canal hasn’t been widenedenough. While it will be able to handleships large enough to carry 13,500twenty-foot equivalent units (TEUs, whichare standard-sized containers) of cargo,the San Pedro Bay Ports already regularlyreceive shipments from larger ships carry-ing 18,000 to 19,000 TEUs, Drummondsaid. These mega-ships are the way of thefuture – 21,000-TEU ships are currentlyon order right now, he noted.Still, some cargo may be diverted from

the Port of Long Beach through thePanama Canal. “In my opinion, we willget as much [cargo] as we lose, becausethere will be some cargo coming up[westward] from Brazil that will passthrough the canal and come to the WestCoast,” Drummond said.Of more concern to Drummond are ports

on Canada’s West Coast, specifically theports of Vancouver and Prince Rupert,which are a shorter distance from Japanthan the San Pedro Bay Ports. While theU.S. federal government charges a harbormaintenance tax on arriving cargo, theCanadian ports don’t have such a tax,Drummond noted. Combined, these factorsmean Vancouver and Prince Rupert have aneconomic advantage over the Port of LongBeach, he pointed out. “They also have deep water, big cranes

[and] new facilities,” plus good railroad ac-cess to the Chicago area, Drummond con-tinued. “So there is a lot of American cargogoing through Prince Rupert and Vancou-

ver,” he said. However, these ports falter inthe winter when Canada is hit with frigidweather – an issue Southern Californiaports do not have.To stay ahead of competition, it is impor-

tant that the Port of Long Beach developsits infrastructure to prepare for larger ves-sels, according to Drummond. “The bigchange over the next 15 to 20 years is goingto be to create bigger terminals, like MiddleHarbor,” he said. “That means we are goingto have to either do more landfill and buildout, or we will need to combine existingterminals.” Slangerup has spearheaded aland use study, currently underway, to de-termine the best direction to take in thisarena, Drummond said.“Over the next 20 years, I think we will

easily double the volume of cargo comingthrough the ports of Long Beach and LosAngeles,” Drummond said. “We’re goingto have to be very creative to deal with thatgrowth over time . . . Along with that, wehave to establish a reputation for reliabil-ity,” he said. “Actions speak louder thanwords. We have to prove that we’re reliable.And I believe we’ll do it.”The Port of Long Beach continues to im-

prove upon its environmental efficienciesand develop stronger ties to the community,Drummond pointed out. “Our clean air andclean water programs continue to improvethe environment every year,” he said. In thefuture, Drummond looks forward toachieving Jon Slangerup’s goal of runningthe Port of Long Beach as a zero-emissionsoperation with clean energy. “We are also doing very well with public

relations. The new book, ‘Port Town,’ is anepic that is going to show the progress ofLong Beach over the past 100 years,”Drummond noted, who has authored twobooks set in Long Beach. (Refer to separatestory about “Port Town” in this edition ofthe Business Journal.)“In the course of my time, I can remem-

ber when we had a giant Douglas Aircraft[Company] that employed 50,000 [peo-ple], we had shipyards that together em-ployed 50,000, and we had a huge Navy,”Drummond said. “All of that is gone. Butwe have a superb port,” he said, explain-ing why he is so invested in the port’s fu-ture. “That’s what we have left, and wehave to protect it. We have to improve it.Because the port is the future of LongBeach. We are ‘Port Town.’” �


“We have 100 miles

of rail in the

Port of Long Beach.

We need 200 [miles],

because we would like

to move more by train.

It is less polluting and,

given the right kind

of infrastructure,

it can give us real

smooth throughput.”

“Over the next

20 years, I think

we will easily

double the volume

of cargo coming

through the ports of

Long Beach and

Los Angeles. We’re

going to have to be very

creative to deal with

that growth over time.”

Doug Drummond(Continued From Page 1)


Take a Trip Back in Time In conjunction with Port Town, the exhibit uses one-of-a-kind artifacts, photos and video to bring to life the remarkable transformation of a marshy mud flat into one of the greenest, most prosperous and most modern ports in the world.

Additional limited edition copies of Port Town will be available for purchase at the exhibit, with proceeds benefiting the Historical Society.

Hours Tues./Wed./Fri. 1-5 p.m. Thurs. 1-7 p.m. Sat. 11 a.m.-5 p.m. Sun and Mon. Closed

Special evening events planned with Bixby Knolls First Fridays: Aug. 7, Sept. 4, Oct. 2, Nov. 6

Learn more about Port Town at porttown.polb.com

“Richly detailed, well researched, and thorough.” — D.J. Waldie, author of Where We Are Now: Notes from Los Angeles and Holy Land: A Suburban Memoir

Port Town — how the Port of Long Beach rose from a marshy mud flat to become an economic powerhouse, one of the greenest and most modern ports in the world.

This epic tale is filled with the true stories of the larger-than-life soldiers of fortune, land-grabbers, lovers, dreamers, and builders who were inspired and bewitched by the Port of Long Beach’s mighty promise.

Now available at Amazon.com and Apple iBooks. porttown.polb.com

Take a Trip Back in Time In conjunction with Port Town, the exhibit uses one-of-a-kind artifacts, photos and video to bring to life the remarkable transformation of a marshy mud flat into one of the greenest, most prosperous and most modern ports in the world.

Additional limited edition copies of Port Town will be available for purchase at the exhibit, with proceeds benefiting the Historical Society.

Hours Tues./Wed./Fri. 1-5 p.m. Thurs. 1-7 p.m. Sat. 11 a.m.-5 p.m. Sun and Mon. Closed

Special evening events planned with Bixby Knolls First Fridays: Aug. 7, Sept. 4, Oct. 2, Nov. 6

Learn more about Port Town at porttown.polb.com

Documents

July 7-20, 2015