Net income jumped by 20 percent in the second quarter for Christian media company Salem Communications Corp. when compared with the prior year. The Camarillo-based broadcaster, internet and publishing company had a drop in broadcasting revenues for the quarter while revenues from the non-broadcasting businesses went up. For the quarter ending June 30, the company reported a net income of $3.5 million, or $0.15 per diluted share, on revenues of $57.5 million. For the same period a year ago, the company had a net income of $2.9 million, or $0.12 per diluted share, on revenues of 58.8 million. For the third quarter, Salem projects a drop in revenue in the low-single digit range over third quarter 2007 total revenue of $56.9 million. Shares in Salem closed down at $1.65.

Munchkin Inc., launched its third annual Project Pink campaign to spotlight early breast cancer detection and urging women to have breast exams. The Jorth Hills-based company is promoting the sale of signature pink bath ducks to raise money to benefit Susan G. Komen for the Cure. “As this disease can strike women at any point in their life, our goal for the Project Pink campaign is to help promote education, awareness and early detection,” stated Doug Gillespie, Munchkin vice president of marketing. Project Pink is a multifaceted program involving both consumer and celebrity components, which are all brought together online through a new Web site at www.munchkin.com/ProjectPink .

Thousand Oaks biotech firm Amgen recently licensed a clinical stage molecule for the treatment of chronic and neuropathic pain to Ortho-McNeil-Janssen Pharmaceuticals Inc., a Johnson & Johnson company. The terms of the agreement include a $50 million upfront payment, the potential for $385 million in success-based milestones and additional sales based milestones and royalties on sales. The agreement provides OMJPI with global rights to the product, but excludes Japan where Amgen has entered into a previous license agreement with respect to the compound. OMJPI and its affiliates will be responsible for future development and commercialization of the compound, a fully human anti-nerve growth factor (NGF) antibody. The agreement is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act.

The narrow focus of real estate investment trust PS Business Parks has proven to be a winner with the company posting a 21 percent gain in net income for the second quarter of 2008. Glendale-based PS earned $4.6 million, or $0.22 per diluted share, on revenues of $70.1 million for the period ending June 30, compared to $3.8 million on revenues of $67.5 million for the same period in 2007. The company’s stock (AMEX:PSB) ended the day on a positive note as well, with the stock closing up a little less than one percent, at $53.55. The board of directors also said they would be paying a quarterly dividend of $0.44 per common share.

A federal judge ruled that a racial slur by a juror was not cause to declare a mistrial in the lawsuit between MGA Entertainment and Mattel Inc. In rejecting a motion by MGA for a mistrial, U.S. District Judge Stephen Larson came near the end of deliberations, after the jurors had already decided on all key points, the Los Angeles Times reported. The woman juror, who was later dismissed, made racial comments against Iranians and that they were “stubborn, rude” and “thieves.” Van Nuys-based MGA Entertainment’s CEO Isaac Larian is of Iranian descent. The jury ruled in Mattel’s favor in its lawsuit that MGA and Larian had aided and abetted a Mattel employee who came up with the design of the popular and lucrative Bratz line of dolls in violation of the employee’s contract. With the mistrial motion decided, the case now moves on to the damages phase.

Christine Deschaine Lee & Associates LA North/Ventura Inc. Many real estate deals are a fairly straightforward transaction, with a buyer or lessor on one side and a seller or lessee on the other. We all know how challenging even those seemingly clear-cut deals can be. So imagine the complexities of a redevelopment project like the Third Street Promenade, Hollywood & Highland, or The Burbank Collection, opening later this year. Those are all projects that Christine Deschaine, principal of Lee & Associates-LA North/Ventura Inc. has been instrumental in bringing to fruition. It’s not a quick and dirty process, but Deschaine says the process and the result are both rewarding. The Third Street Promenade in Santa Monica was her first introduction to redevelopment. “A lot of people thought we were wasting our time,” she said. “There were lots of dynamics going on with the city council and the homeless community. It took 10 years for people to see that happen.” Her work often begins even before a developer is brought on board. “Usually there is a group of people who have a vision and they meet with their city council people and their residents and their existing business owners and decide how they see their typical downtown area,” said Deschaine. “My relationship usually starts with them. Sometimes they will ask me to find them a developer that I’ve worked with before who can pretty much come to the table with the sort of theme or quality of project that they’re looking to see.” Even if they ultimately select a developer she hasn’t previously worked with, Deschaine said she finds a way to secure a relationship. Then she hits the bricks, educating tenants, local business owners, residents and even other brokers about the goals that the community is trying to achieve through the redevelopment project. So how does a broker make money on a project that can take three to five years before any commitments are made? “We get paid half typically when the lease is signed and then the second half when the tenant takes possession,” she said. “Some brokers actually will get sort of a monthly fee from the developer and use that against commissions that come in.” That’s a route she said she’s thinking about taking. In the meantime, though, she does a lot of what she calls “bread and butter leasing” to maintain cash flow. Her redevelopment agency clients appreciate Deschaine’s expertise. “She’s great working with us because she sees both sides of the picture,” said Gail Stewart, downtown manager for the Burbank Community Development department. “She sees the big picture of what we’re trying to create in downtown and works with us to bring in the right tenants that will be exciting and that the community would like to have.” And while some might think that any project steered by municipal government would be the very definition of hell, Deschaine said she considers redevelopment projects actually to be easier. “You have a cohesive group moving forward to achieve the same goal,” she said. Further, unlike a typical retail developer, a downtown redevelopment agency and a city have to be true to the residents. “It’s good to work with people who have accountability,” said Deschaine. Sheryl Mazirow Mazirow Commercial Inc. Laser focused. Those are the words Sheryl Mazirow uses to describe her success as a tenant representative. “All we do is specialize in working on the tenants’ behalf,” said Mazirow who heads the boutique firm Mazirow Commercial Inc. in Westlake Village. “There are a couple other firms who do what we do, but they are not laser-focused on one geographic area,” namely the San Fernando and Conejo valleys. She considers herself truly a tenant advocate. “Our premise is that you would never go into court permitting the opposing party’s attorney to represent you,” Mazirow said in describing her role. “Tenants do this once every five years, typically, and are not very well informed, but the landlord does this day-in and day-out.” When Mazirow started her real estate career 28 years ago, she looked around the office and saw that the person making the most money in the office was focused on tenant representation. So she copied everything he did. “Earlier in my career I did lease buildings from the ground-up,” said Mazirow. “So I understand the landlord’s perspective having worked on that side very early in my career.” It’s not all leasing either. Mazirow does represent tenants who want to own their own building. She’ll perform an analysis that helps a business owner decide whether it would be more beneficial to lease or to buy. But even there, she is “laser focused on office product, some R & D;, but not hard-core industrial. I don’t sell apartment houses.” Mazirow does not only represent clients when they move, but also helps them when they want to stay where they are. “We represent them when they exercise an option, renew a lease, or sublease excess space,” she said. “Anything that has to do with office space that a tenant occupies.” Her relationship with clients can span multiple transactions over many years. She began working with what is now one of her larger clients, Employers Direct Insurance Co., back when leasing an executive suite was all they could manage. Years later, Mazirow said, they took a sub-lease on 12,000 square feet. Growth then caused them to lease 35,000 square feet and in what Mazirow believes is one of the largest transactions in the Conejo Valley, they recently signed up for 67,000 square feet of space. That’s the entire building. The relationship even continued after the company was sold to an out-of-town owner. “My opinion of Sheryl is, she is probably the best business relationship that I ever made coming out the door,” June Duxler, vice president human resources and administration for Employers Direct. She’s worked with Mazirow since the company’s inception in 2002. “She’s incredibly knowledgeable. She does what other brokers promise to do. There’s not enough wonderful things I can say about her,” said Duxler. With more than $22 million worth of transactions to date, Mazirow’s business may be boutique, but it’s certainly not small potatoes. She does it all with one other agent and two support staff. And while most of the industry is fairly stagnant, she is not seeing much of a slowdown on her end. Most leases, she said, have a holdover penalty that can be anywhere from 125 percent to 300 percent of the current rent, even if the tenant stays on the premises. So tenants don’t have the luxury of procrastinating. “It’s a much more favorable environment for tenants,” said Mazirow. “There are many more options than previously.” Jeffrey Peldon REMAX Some people don’t know when to quit, some people are overachievers, and then there’s Jeffrey Peldon, who is both of those and then some. He has an MBA in finance and organizational dynamics and a Juris Doctor degree; has been admitted to the bar in New York and New Jersey; and also has a California real estate broker license. In 2007, Peldon was named the top REMAX commercial broker associate in the state and was number two out of 7,200 nationally. He did that without any staff, assistants or associates. He’s not just trying to pinch pennies, either. Peldon cheerfully admits that he’s just too demanding. “The combination of the hours I work, and the way I work, and the demands I put on myself,” are just too much for most, he said. “I would rather spend more time and get the job done and know I don’t have to check it.” He said he will work on deals with other agents, but doesn’t see the value in having a partner. “That’s my OCD of real estate,” he said. “That’s the way that I am. Other people are more effective than me, I’ll give them that, or will out-earn me, and I’m comfortable with that.” A self-admitted geek, Peldon utilizes technology to work smarter. He never goes anywhere without his PDA. “I can do everything I need to do with that,” he said. Keeping paper to an absolute minimum is another way to streamline. “All of my computers are interconnected. If I make a note on a file while I’m in the field it’s replicated in three different locations.” Peldon also works only with title and escrow companies that use PDFs and he’s trying to get all of his regular clients to begin using electronic signatures. Multi-family projects are the focus of his business model. While the apartment sector of the market is very healthy, with vacancy rates in most of the region below 5 percent, transactions have been almost nonexistent, especially in 2008. “We’re probably running about 15 percent of the activity level compared to 2004 to 2006,” he said. The interest is there, but lenders, Peldon says, are making things very difficult. That’s where creativity and tenacity come into play, as illustrated in the following example. “I was working with a client selling a 27-unit busted condo deal it shifted from condos to rentals At 27 units, this deal was going to appeal to a relatively small owner type. So I went to seller and said, ‘believe it or not, we need to make this more expensive. We need to make the project itself bigger. You have two other buildings. Instead of 27 units, I’d like to sell all 84.'” The seller agreed and Peldon converted the deal to a portfolio sale on which he has received multiple offers from well-heeled borrowers that don’t need to go through the typical lending channels. “I went from a building that was going to sell in an $8 million to $9 million range to now a $22 million portfolio,” Peldon said. Client Denise Baruch of J & D Baruch Management has had a business relationship with Peldon for the past four years, selling seven of her own properties and eight or so belonging to other investors with whom she partners. “We put our buildings into sale mode last spring,” said Baruch, “and he brought in the buyer there were lots of complications as there always is but he just juggled things around and made everybody think they were winners.” The sellers, said Baruch, “had an idea of what our buildings were worth, and I don’t know how he did it, but he got us more money as the sellers. We felt overly pleased with the results.” John Sabourin, Will Adams and Paul Stockwell CB Richard Ellis This triple-threat almost didn’t make it into this report as their business cards have a downtown Los Angeles address. Even with Sabourin and Stockwell both being Valley natives and residents and having the bulk of their clients and deals in the Valley, we were still iffy about including them. But then they invited us to their Warner Center satellite office, in the newly-completed LNR Corporate Center that makes up the bulk of vacant office space in Woodland Hills, and for which they are the landlord’s representative. Points for persistence, score for locality. All three were top dogs at Studley through the end of 2007 Adams was corporate managing director and Sabourin and Stockwell were senior managing directors. Then in January, the trio become a team under the CBRE umbrella. “We have nothing but good feelings toward our former partners at Studley,” said Stockwell about the move. Studley, he said, “was heavily focused on the tenant representation side and the three of us just wanted to do some other stuff, like I’ve done with the landlord and agency leasing; get more involved in the investment side of things, and round out our capabilities through a much broader and deeper kind of real estate platform.” So why the team approach? “If you look at most of the very successful brokerage operations, not just at CB but almost any company, you find the majority of the successful people are in teams of differing sizes,” said Stockwell. “There’s one group I know that’s probably got 15 people on a team and others that are just two guys; but one way or another it does seem to work well in our industry for a variety of reasons.” In addition to being able to capitalize on the differing skills sets, personalities and knowledge bases of each other, fee sharing is another good reason to band together. “There’s no question that this is a cyclical business,” Stockwell said, “and if one guy on the team is having a good year, it helps support the guy not having as good a year.” Stockwell lives in Burbank and as the former head of corporate real estate for Disney in the early 90s, his specialty is entertainment; Sabourin lives in La Ca & #324;ada Flintridge and has an expertise in office and tenant representation; and Adams lives elsewhere and has an expertise in office and law firms in particular. “John and I do more of the landlord work and Will and I maybe do more in the entertainment side,” said Stockwell, “but having a balance both in terms of skill sets and, candidly, in terms of geography is just a prudent way to approach the brokerage business.” Major client Ken O’Neill, vice president of LNR Property Corp. agrees. “The biggest issue for me is both of those guys are incredibly experienced,” said O’Neill. There’s definitely a benefit to having two very experienced brokers on a team, “rather than one experienced guy and a rookie runner.” That has helped in a very competitive market where, O’Neill said, there are few fish in the pond and a whole lotta fishermen. “You have to be very creative, very analytical to make deals,” he said. “John and Paul have allowed us to do that.” Yair Haimoff NAI Capital As one of the newer kids on the block, NAI Capital’s 2005 Rookie of the Year, Yair Haimoff, 32, has found that strong mentors and good old-fashioned hard work have been the keys to success. His focus for the past five years has been in Santa Clarita Valley, a market he has studied intently. “You really have to know your territory your streets, the areas, city ordinances, zoning,” said Haimoff. “You really need to be an expert in the area that you work in. We do it first through canvassing knocking on doors and meeting individual owners and tenants.” He also joined the Chamber of Commerce, the Valley Industrial Association, and has developed relationships with the City of Santa Clarita-designated enterprise zone officers. “Basically, he’s probably one of the hardest working brokers we have,” said one of his mentors, Tim Foutz. “Helping to train Yair I get phone calls at 10 at night or six in the morning.” That Haimoff has been able to garner trust from people in their 60s and 70s is a testament to the dedication he has given in becoming an expert in the Santa Clarita Valley marketplace, said Foutz. “A lot of new brokers have a problem because people don’t want to entrust their portfolio or building with someone who has only been in real estate a few years. Because of his knowledge and drive he has been able to make a tremendous amount of money.” The company declined to release particulars on Haimoff’s earnings, but a quick calculation of his accomplishments suggests he has been involved in the acquisition, disposition and/or leasing of more than a half million square feet of space so far. For just one entity, IST International Finance, he has handled a total of 13 buildings: 11 in Santa Clarita, one in Van Nuys and one in Sylmar with a value of “close to $20 million,” said Haimoff. It’s not exactly what he expected to be doing when he graduated from California State University Northridge with a bachelor’s degree in criminology in 2003. “I was going to go into the law enforcement field,” said Haimoff, “But when I met my fiancee’, she’s a developer, she suggested I try commercial real estate it’s still high-stress, but safer.” Stacy Vierheilig-Fraser Charles Dunn Company The name Vierheilig has been on Charles Dunn letterhead for the past 50 years. It started with Ed Virheilig who was a broker there for 40 years, retiring about 10 years ago. Following in his footsteps is his daughter Stacy Vierheilig-Fraser, who has represented Dunn for 20 years now. After graduating from the University of Southern California with a bachelors in business administration, emphasis on real estate, Vierheilig-Fraser processed home loans before starting at Dunn. “My dad told me I had to have a salaried job before I went into commissioned sales,” she said. Now the senior managing director of the Studio City office Vierheilig-Fraser, at the ripe age of 45, is doing for the other younger six agents what she has always done in her career mentor young talent. “I’ve trained probably two dozen ‘kids’ in the company and right now there’s seven of them still working with the company,” said Vierheilig-Fraser. One of her current mentees, agent Stella Kanyan, 27, attributes Vierheilig-Fraser’s success to a great work ethic. “She puts the same amount of time and effort into the small deals as the really big ones,” said Kanyan who also praised her willingness to help other agents succeed. “She’s had relationships for, like, 20 years that she’s built and if she’s worked with someone before, she tells you everything she knows about them.” Knowing her market intimately is also another key to success, said Vierheilig-Fraser who recounts a time when she first started working in the east San Fernando Valley and wasn’t able to tell a client the fastest way to get to a property viewing. “I know a lot of people like to jump around but I wanted to know everything about my market,” she said. “My office is in it, I live in it, my kids go to school in it.” About 80 percent of her clients are somehow related to the entertainment industry, with income derived about equally from leasing and sales. “I’ve sold over 100 buildings which is a lot for commercial,” said Vierheilig-Fraser. “I probably handled almost every building in my market at one time or another.” She holds the record of most consecutive top producers titles at Dunn. “You have to make a certain amount of money to join ‘Charlie’s Club,'” she said, “and I’ve done that for 15 years and so far I’m on track for this year, too.” And even though the market is, in her words, “just dead,” Vierheilig-Fraser said she got started in real estate in 1988, which was one of the last great years of an economic slowdown very similar to current times. She knows that in addition to a strong knowledge base and long-term relationships, going the extra mile is the key to closing deals. “I’m trying to do extra marketing things virtual tours, solar lighting for my signs so they can be lit up at night. Just little extra things that you have to do,” she said.

By IVY WEISS Contributing Reporter On July 24th, the Shrine Auditorium Expo Center was filled with the sounds of over 3,000 people doing business with each other. The 10th Annual L.A.’s Largest Mixer brought together business, Chambers of Commerce, organizations and service clubs and put them all in front of an almost capacity crowd. The San Fernando Valley is always well represented at this event. Chambers from across the Valley have been participating since the first year. The Mixer is the brainchild of Dave Linden, who has seen it grow over the past decade from his simple idea to bring a wide array of businesses together, to the huge success it is today. It has outgrown five venues. Sponsor’s of this year’s event included the Canoga Park/West Hills, Great San Fernando Valley, Sherman Oaks and Universal City-North Hollywood Chambers of Commerce, the Regional Black Chamber of Commerce of the San Fernando Valley, the United Chambers of Commerce, VEDC, and VICA comprising a quarter of the sponsor list. Valley Chambers and business organizations have been with the event from year one and the same Chambers return year after year for this opportunity to meet new members. Nora Ross, Executive Director of the Canoga Park/West Hills Chamber has participated since she became associated with the Chamber. “The Mixer is enjoyable, and more importantly it is an opportunity to meet a lot of people, many of whom do business in our area. The contacts we make are amazing and I look forward to doing this again next year and the years after that.” Fifty of the more than 200 exhibitors were Valley businesses as well. There are so many exhibitors that the organizers are seeing the event as more of a Trade Show than business mixer. This year the Valley’s strength was represented in a room that featured businesses from a geographic area that ranges not only through the Los Angeles County area, but also as far away as Phoenix and Mammoth. Linden credits the Valley participants with a lot of the success over the years. In L.A.’s Largest Mixer’s third year, Judy Kessler Block, a prior CEO of the Encino Chamber brought KABC radio to the event, and that relationship has continued throughout the years. “Our relationship with KABC is what the event is all about networking,” Linden stated. KABC is now also involved with Orange County’s Largest Mixer which is also produced by Linden’s company. In a time of economic challenges, L.A.’s Largest Mixer is maintaining its strength. Exhibitor and visitor attendance has not wavered from last year, while many other businesses are seeing drops in revenue. The event has so grown in scope, that what Linden and a few volunteers used to do now takes a staff of 63 on the day of the event. “The event is about business from all over L.A. County coming together to make contacts and bring economic growth to their communities. I find it heartwarming when I get calls after the event from happy exhibitors telling me ‘It worked,'” Linden offered. He continued, “When you name something L.A.’s Largest you have to produce the numbers, and that is a daunting task. This is a collaborative effort from the first days of planning each year. It is the businesses and non-profit organizations who make this a success. And our Valley connections never fail us.” North Valley Regional Clusters Aid Referrals The North Valley Regional Chamber of Commerce (NVRCC) offers an way for member businesses to network and grow through referrals Clusters. Five clusters meet each week at various times during the day, usually in the morning and at lunchtime. Meals are served at each cluster meeting. What is a cluster? A cluster is a group of chamber members who meet weekly to talk about their businesses, what kind of referrals they are looking for, and simply get to know one another well enough on a personal and professional level to be able to refer business to each other. Cluster members have received hundreds of referrals, and sales, solely from the cluster meetings. To avoid competition within the cluster, only one person per profession is allowed to join each cluster. A person can visit cluster meetings twice before joining the Chamber. Several business categories are currently available. For more information, please contact the Chamber office at (818) 349-5676 or go to nvrcc.com.

After having been fired from a reporting job some years back I called my former college advisor for advice on what to do next. Bob Reid was part teacher, mentor, and father confessor; a chain-smoking, literate physician giving verbal injections that journalism was a noble calling. Whether in person in his small office in the basement of Greg Hall on the University of Illinois campus, or by phone (during which you could hear him taking puffs from a cigarette), a talk with Bob Reid left you inspired. During that 1996 conversation, he advised not to get discouraged or cynical. However, he warned, the corporate mentality I went up against at that job would be present wherever I went. “Every generation has their demon to conquer and yours is the corporation,” Reid said. “Mine was the fat cat millionaires and persuading them what should be done with their printing presses.” Bob Reid died in December 2004 before he could witness the collapse of the newspaper business; to read about major American newspapers cutting editorial staffs, watch their circulation drop, and lose readership to online news sources. That quote comes to mind as the Los Angeles Times finishes up another round of layoff and buyouts that eliminated 135 newsroom positions. By my count that is the fourth time since June 2004 the Times has made such cuts so it’s clear that the corporation is conquering the journalists rather than the other way around. Along with employees, the Times did away with 14 percent of its news pages, including the Sunday opinion and book review section Industry-wide cuts Elsewhere in Southern California and across the country, the story is the same. The Business Journal has detailed the staffing cuts at the Daily News; in June the Ventura County Star took the path of other publications by eliminating its standalone business section, and consolidated some feature sections; the A.H. Belo Corp. and the McClatchy Co. cut positions at their respective newspapers. Besides the Times, other Tribune Co. papers lost staffers as well. In January, when the Chicago Sun-Times aimed its axe at the newsroom I kept in daily contact with two friends to find out if anyone we knew was among the victims. Fortunately none were although a former co-worker did take a buyout from the paper. In June, I learned that a long-time friend took a buyout from Gatehouse Media’s weekly papers in suburban Chicago after 12 years of service. GateHouse is a publicly traded company with newspapers primarily in the Midwest and Northeast and as of July 29 its stock traded at $0.72 per share. I’ve worked with reporters who got out of the newspaper business for various reasons but now when they do it’s done with more urgency. Yes, there were times when I declared I would leave journalism to go over to the “dark side” of public relations or do something completely different. But I was never serious. Those were statements borne of frustration of covering yet another fourth-grade science fair, another late evening spent at a dull city council meeting for which I received no overtime pay, or dealing with an unreasonable editor. For years one of my best friends, who I met in a journalism class nearly 19 years ago, said he was getting out of the business. Then last fall Steve finally did so, leaving the Daily Herald, the third largest daily in Chicago, to go to the American Library Association, although he continues to put in time as the Sunday reporter. Just as the Tribune and Sun-Times faces financial challenges, so does the family-owned Herald. In the past year alone came across-the-board salary cuts followed by two rounds of layoffs. The morning I finished this column, I talked with Steve and amidst the conversation about the Chino Hills earthquake and the playoff possibilities of the Cubs and White Sox, he mentioned that two more people, one an editor, had left the Herald. That same morning I read at LAObserved ( www.laobserved.com ) that Tom Johnson had resigned as general manager of Times Community Newspapers, the L.A. Times-owned chain where I once toiled at the Burbank Leader. By leaving, Johnson said in a statement included at the website, he accepted that “I wasn’t in agreement with the direction the company was headed.” Pellmell With Zell In the face of all that bad news perhaps even my former college professor would find difficulty remaining optimistic about the state of the newspaper business. His attitude perhaps would stay the same about the demons out there to slay, except in these times it is both the corporations and the fat cat millionaires. Make that the fat cat billionaire when it comes to the L.A. Times. The flash point for anger at the state of the Times centers on Sam Zell, the foul-mouthed, white-bearded real estate mogul who bought Tribune Co. and put it into private hands (his and the employees). He’s inspired a website ( www.tellzell.com ), a spoof website of the Times ( www.notthelatimes.com ), the hanging of a banner from the Times parking garage (“Zell Hell” in dramatic black and red letters) and a full page ad in the Studio City Sun by Valley resident Jack McGrath urging Zell to sell the paper. The ad-generated phone calls and e-mails from Times subscribers upset over the direction of the paper, a sentiment that McGrath looks to harness in coming weeks with a rally outside the paper’s building on Spring Street. The Valley public relations man couldn’t stand by to watch the disintegration of what he considers a national newspaper by a man Zell with no newspaper experience and who only cares about the bottom line. “There is a very, very large backlash against him and what he is doing to the newspaper in the L.A. media market,” McGrath said. The actions of McGrath and others may not be what Bob Reid had in mind but contains the same spirit of conquering the corporate billionaire fat cats. The bell has tolled for hundreds of working reporters. Does it toll for Zell? Staff Reporter Mark Madler can be reached at (818) 316-3126 or by e-mail at [email protected]. His college advisor once told him that “grades were bulls**t” but that’s a column for another day.

At heart, Chris Hundley is a race car fan. The self-styled speed demon doesn’t drink or smoke. He claims his only vices are horsepower and adrenaline. Hundley talks lovingly of the Pacific F2000 series and other races he’s driven in. In 2006, he nearly died on the racetrack in a crash that left him with a broken collarbone. For the full story visit www.latimes.com/business/la-fi-limo4-2008aug04,0,3627279.story

It’s budget time again for California and, once again, the budget is late. The issue is that we are facing another big deficit year and, in order for the legislature to pass a balanced budget, as required by Proposition 58 (officially called The California Balanced Budget Act) passed on March 2, 2004, some very difficult decisions need to be made. These decisions are being impeded, as usual, by partisan politics. The Republicans are opposed to raising taxes and the Democrats are opposed to cutting services and social programs. Both of these alternatives can have significant negative impact on our already anemic economy. Because California is already one of the most expensive states in which to do business, raising taxes will make us even less competitive with other states thereby potentially causing more businesses to either move, cut back or outsource their labor thus creating significant job losses. Additionally it will keep new businesses from moving in. Alternatively, cutting services and social programs will not fare well in attracting new businesses nor will it be acceptable to those businesses that are here and are paying substantial dollars for the privilege of receiving those services and whose employees are benefitting from some of those social programs. Probably the best way to reduce or eliminate a deficit is to create revenue by stimulating the economy. As business activity increases, more jobs are created. In turn, profits from the increased business activity and salaries from the additional jobs generate more tax revenues for the state and the deficits reduce (provided, of course, that state spending doesn’t increase significantly). Although there are a number of ways to potentially stimulate the economy, they all take time and we are out of time for this budget cycle. As a matter of fact, we haven’t reduced deficits in many years by stimulating the economy. Instead, we have been balancing the budgets by borrowing and by cutting services and programs. This year we seem to have hit the inevitable brick wall. Out of options It appears that we can no longer fix the problem by simply borrowing and cutting. To do so would exacerbate the economic problems that already exist. We need to raise revenues and utilize responsible means to reduce our deficits. Currently some of the proposed solutions to resolve the most recent estimated deficit of approximately $17 billion include increasing revenues by modernizing and securitizing the lottery, placing sales taxes on personal services and by the elimination of tax credits and loss carryovers. Since the increased revenues from these measures will not solve the entire problem the revenue enhancements will be accompanied by additional cost reductions consisting of cuts including services, social programs. Although there appears to be some room for cuts I believe that there are significant cuts included in the proposals that will be harmful to our economy. I also believe that placing sales taxes on personal services and eliminating tax credits and loss carryovers will have a similar harmful effect. I suggest that we avoid the cuts having the most severe negative impact and forego the elimination of tax benefits and, instead, provide additional revenues by implementing a temporary (2-year) surcharge of 10% on state income taxes that would be exempt from current mandates and would apply to all taxpayers. The revenues generated by the surcharge would therefore be available strictly to protect the more important current discretionary services and social programs and to save existing tax benefits from elimination. Currently, personal and corporate income taxes amount to approximately $70 billion, thus the surcharge would protect approximately $7 billion of these services, social program costs and tax benefits. To allow the surcharge to achieve full impact, no new discretionary items or increases in existing discretionary items would be allowed during the surcharge period. To attract new businesses to California, and, therefore create an additional (over and above that provided by tax credits) economic stimulus, the newly attracted businesses could be exempt from the surcharge. As the economy strengthens and more tax revenues are generated the surcharge will no longer be needed. If revenues have not adequately increased by the expiration of the surcharge period, consideration could be given to extending the surcharge for an additional two years under the same restrictive conditions. Gregory N. Lippe, CPA, is Managing Partner of the Woodland Hills-based CPA Firm of Lippe, Hellie, Hoffer & Allison, LLP, Chairman of the Valley Industry and Commerce Association (VICA) and a Director of First Commerce Bank.