I will remain as editor of the Business Journal. To all my contacts, sources and friends of our newspaper, I just want to clearly tell you that right at the beginning of this column. A few issues ago, this newspaper announced that I had resigned. I was moving on to explore other opportunities out there. I was staying until a replacement was named. Then I’d be off. Well, everybody is allowed one really bad career decision in their life, I hope. That one was mine. Here’s the scoop. After quitting, I began realizing that I had probably one of the best jobs a journalist could have. I was running the editorial portion of a growing media outlet in a time when many other outlets are reducing. We’d been doing some good things and our publication had grown to become a trusted source of information in our community. I also have a great, energetic staff. I work for a great publisher and a great owner who really care about our product. We’re in a geographic area that has a lot of news to report on. It’s all very interesting. Seriously, the opportunities I was looking for are here. Forgive me for my dumb decision and any confusion it may have caused. Enough about me, I feel really uncomfortable writing about myself, but I wanted to make sure I communicated directly with readers about my status here since the editor has a profound effect on a publication. The Business Journal starts off the new year with an old editor. But that’s a good thing for me and I believe for our publication. We’ve got lots of plans and I’d really like to focus on those now. In 2008, we hope to give you a crisper, easier to read and newsier Business Journal. We’ll continue to provide analysis of local business news but it’s our intent to make sure we get all our geographic areas covered on a regular basis. This means all our Valleys and the communities within. You’ll see spotlights on certain cities and areas, with news on the businesses and the business development going on there and the people who are making it happen. We’ll identify the best companies to work for and ramp up our coverage of the people involved in local business. Who are they and what do they do that works or doesn’t? We’ll have a better Internet presence and you’ll see us out and about in the community more than ever. I know that getting out of the office and having face-to-face contact is important in helping us establish rapport with readers and sources. This gets us the stories that we write. Those are just a few things that we will be doing and I hope that you continue to provide me and the rest of the staff with feedback about our newspaper’s content. Please provide us with story ideas and introduce us to people we should know. The new year contains some unknowns as far as the economy goes. We all know that. But whatever happens, the Business Journal will be there covering the news objectively as usual. Thanks for all your calls and e-mails to me in recent weeks. The best part of my job is meeting people. I wish for you a happy, healthy and successful new year. Business Journal Editor Jason Schaff can be reached at (818) 316-3125 or at [email protected].

Questions remain unanswered about the two biggest blows to the Southern California economy the subprime mortgage meltdown and the strike by television and film writers that shutdown production. Lurking in the shadows is the dreaded “R” word recession. While the forecast by the Los Angeles Economic Development Corp. does not call for a recession, the organization’s chief economist Jack Kyser said repeated use of the word creates a downbeat mood. “It’s going to be a difficult year for a lot of people,” Kyser said. As though 2007 wasn’t difficult enough already. Foreclosures on homes bought with subprime mortgages loans to borrowers with less than perfect credit escalated during the year, leading to mortgage companies filing for bankruptcy or making significant cutbacks in staff. In the San Fernando Valley, that meant layoffs at WMC Mortgage in Burbank, the lending arm of General Electric Co., and at Countrywide Financial in Calabasas. Countrywide’s difficulties were worsened by an informal investigation into the sale of $130 million in shares by CEO Angelo Mozilo; and probes by the state attorney generals of California and Illinois. With home prices dropping and sales stagnating, retail spending reduced and the cost of a gallon of gas staying above $3 with predictions of $4 a gallon in the spring, there can be little wonder of the talk of a recession. The Dow Jones posted a fourth quarter drop but finished the year with a gain, as did the Nasdaq and the Standard & Poor’s 500 index. “A lot of people believe we started a recession in December,” Hugh Johnson, chief investment officer of Johnson Illington Advisors, was quoted last month by Reuters. “We’ll get a good idea whether that’s true or false from the jobs data.” Further clouding the local economic picture is the ongoing strike by the Writers Guild of America against the major studios. The writers may have started the walkout but are not the only ones whose livelihood is on the line the longer the strike lasts. Suppliers and vendors to production companies and below-the-line crew members also feel the effects. The sticking point between the writers and the studios how to divvy up revenues generated from TV series and films made available online and on mobile devices will need to be worked out with two other unions whose contracts expire in June, the Screen Actors Guild and the Directors Guild of America. Negotiations between the studios and the DGA are scheduled to begin Jan. 7. A recession could be triggered if the WGA strike continues into the summer and then the actors, already in solidarity with the writers, stage their own walkout. “Given the importance of entertainment to the Valley, both those folks being out would really have a large effect on the industry and flow of dollars in the economy,” said Dan Blake, director of the San Fernando Valley Economic Research Center at California State University, Northridge. The combination of the reduced spending due to the strike and the credit crunch is already starting to make itself felt in retail spending, Blake said. Discretionary spending for restaurant meals, entertaining, and sports will be cut back. “Somewhere in the retail sector there is going to be some tightening,” Blake said. That may not be the best news for the city of Glendale where the American at Brand mixed-use project is scheduled to open later this year. But while Blake expects less retail spending that may not be the case with new retail projects that shoppers are excited to see. The American will likely make Glendale more a draw, Kyser added, but the shopping districts in neighboring Burbank and adjacent Los Angeles neighborhoods may see a drop in dollars spent there. Tourism is another bright spot and the challenge for the Valley is to snag those tourist dollars, Kyser said. Should the value of the dollar stay depressed, that could further boost tourism. The new ride at Universal Studios based on “The Simpsons” television show will draw visitors, he added. An agreement between the U.S. and China to allow more casual Chinese tourists to visit is a boon for Los Angeles as the city tends to get the most Chinese visitors. “We’re optimistic this market will build,” Kyser said.

The Business Journal’s Valley, LA Econo Watch is provided in a Adobe Reader .pdf print-friendly file. CLICK HERE to download ECONO WATCH

The “greening” of corporate marketing has proliferated in the last few years with companies touting their commitment to sustainability and environmental sensitivity as another way to standout. One such eco-marketing and lobbying effort is afoot to help a developer gain approvals for a large project in a steeply wooded hillside location along the I-5 Freeway between the San Fernando and Santa Clarita valleys. On its face, the proposed project, called Las Lomas by master developer Palmer Investments, is possibly as green and environmentally sensitive as a mixed-use community could be. Proposals for the project adhere to accepted “smart growth” principles for a new development, with solar-powered residential, commercial, retail and public-use buildings in a woodland setting serviced by a biodiesel-powered tram. The community would run its own biodiesel-powered bus system to take residents to various transit hubs, limiting the number of off-site car trips. All buildings would be designed to a minimum of silver LEED certification standards. A state-of-the-art wastewater treatment facility and stormwater catchment program would recycle all of the site’s water. Streetlights would be powered by the wind. According to Richard Thompson, principal and director of urban design and planning for A.C. Martin Partners Inc. and lead planner for the Las Lomas project, “The idea was to put everything on the table that represented the state of the art in sustainability and what we might be able to do in a large-scale community like this. We put a lot of things out there and Dan (Palmer) has embraced most of them.” But the project’s many opponents including two members of Congress, a state senator, a state assemblymember and a county supervisor cite a series of negatives that they say far outweigh the positives. The 555-acre site is planned to support 5,800 mostly multi-family residences and 2,000,000 square feet of commercial, retail, public and hospitality buildings. The property runs adjacent to the I-5 just north of its junction with Highway 14, amid a wildlife corridor and just across the freeway from the Sunshine Canyon Landfill. Investments in infrastructure would need to be made, including widening The Old Road, adding freeway ramps and building a new Metrolink station deep under the mountains, critics say. “The preposterousness of taking 1,000 feet of mountains and shaving them off to fill-in gullies and valleys to make flatlands and move 20,000,000 cubic feet of dirt is more like an environmental holocaust rather than the environmental remediation that he (Dan Palmer) is so fond of referring to it as,” said Bart Reed, executive director of The Transit Coalition. Reed is alluding to the fact that Palmer has been quoted numerous times as saying that Las Lomas would take a site that has been degraded by its use as a paintball play area and return it to its natural splendor. “The paintball site is one-half of an acre out of 555 acres,” said Reed. “There’s nothing there that needs to be remediated with the exception of that fraction that’s a paintball park.” The proposed on-site wastewater treatment plant would allow most of the water brought into Las Lomas to be recycled and re-used on-site. “All of the office and commercial buildings will be designed with a two-pipe system,” said Thompson. One pipe will have potable water and the other will have “gray water” non-sewer household water treated after use that will flush toilets, irrigate the landscape, and run through buildings’ radiant heating tubes. Even storm water runoff will be captured, treated and re-used. “We will have extra water at the end of the day,” said Thompson, “and nearby golf courses will be able to use the gray water that is left over.” But in a white paper outlining his reasons for opposing the project, Councilman Greig Smith claimed that the city’s Sanitation Department rejected the Las Lomas plan to have an on-site water treatment facility. Countering that, Thompson said, “We met several times with the Los Angeles Sanitation Department. They’re very excited about this. The questions we’re working out with them are: Will we manage that as sort of an out-sourced facility or will they take over the management of it? They’ve embraced the idea; they think it’s wonderful, and so that’s not really the issue. It’s an issue of bureaucracy and how to manage it within their existing system.” Another innovative program is a solid waste recycling system using pyrolysis, a way of burning solid waste at very high heat intensity. Thompson said the process creates an ash that is usable as fertilizer and the energy generated by the incineration process can also be captured and turned into electricity. Yet Thompson allows that proposal might not be feasible. “It’s not a new process but there are some questions about whether it can work,” he said. “Greig Smith actually likes that system but others are suggesting there may be pollution issues with it that may or may not be solvable.” Renewable Energy The plan is that at least 50 percent of the properties’ energy requirements will be generated through renewable sources, primarily solar and wind. “We’re requiring all residential buildings be wired for (solar) photovoltaics. That makes it easier to put them in later,” said Thompson. “In the commercial sector, for the commercial, office and retail buildings, we are looking to require builders to place photovoltaics on probably 35 to 40 percent of the buildings. Also the roof surfaces of every parking structure will have an array of photovoltaics to serve both as an energy generator and for shading cars.” Wind is another component of the Las Lomas energy plan. “There’s a good deal of wind coming through there and we can capture a good deal of wind energy with a relatively small number of compact, small-scale turbines,” said Thompson. “What we’re thinking about now is having all of our street lighting and all energy for public components of the project school, police, library, street lights and so forth be powered off wind energy or photovoltaics placed on the south-facing edges of the retaining walls.” Santa Clarita-based development consultant Allan Cameron isn’t buying it, offering this analogy, “If you built a slaughterhouse at the corner of Sepulveda and Ventura boulevards, equipped it with solar panels, a water cleaning system and a tram to take its employees down to the Metrolink station in North Hollywood, would that make the project appropriate?” Transportation There are two elements of the Las Lomas transportation system. The first is an inter-community trolley system that would allow people to get from one place on-site to another without using their automobile. That trolley system would run on biodiesel. The second is an off-site shuttle or bus system that would be operated by and paid for by the homeowners’ association. Those vehicles would also utilize biodiesel for fuel. “The plan is to hit basically all the major transit nodes in the Valley the North Hollywood Red Line, the Orange Line station, CSUN, down to Encino and Warner Center,” said Thompson. Addressing the movement of people on- and off-site, Bart Reed said that most of the project’s residents that would be using the off-site service would ride the shuttle just during peak hours, during the morning and evening commute. Even if the system had 30 buses, he said, that would equate to about 1,200 seats. “Since there’s 20,000 people who will supposedly be living (at Las Lomas),” said Reed, “those buses can only hold a fraction of the people living there.” Air Quality With Las Lomas being sited so close to the I-5, air quality for the residents is a concern. “As far as air quality, we are looking particularly at the school site and re-orienting that further back,” said Thompson. A UCLA study released recently showed the negative effects of pollution generated by freeways on children attending schools located near area freeways. “We already have it set back about 400 feet and they would like to have it set back about 500 feet so we’re trying to wiggle the school away. When the UCLA study came out we immediately started rethinking the school’s siting,” said Thompson. Uncertain Future Las Lomas has a series of hurdles to leap. Attempts to have the property annexed by the City of Los Angeles have been rejected twice. State, county and local agencies have to approve the myriad of infrastructure improvements that would be necessary. And in another twist, the spending bill signed by President Bush on Dec. 26 included $3 million for a study of the Rim of the Valley Corridor in the Santa Monica Mountains Conservation area. The Las Lomas project falls within the study area, calling into question whether the property could eventually come under National Park Service management.

This is a regular feature on philanthropic activities by Valley-area businesspeople and companies. The San Fernando Valley’s largest financial institution, Lockheed Federal Credit Union, has received IRS approval to form a nonprofit 501(c)(3) entity that will be called the LFCU Community Stars Foundation. In deciding to jump through the legal hoops required to create a separate foundation, President and CEO Dave Styler said they wanted to make it as easy as possible for staffers to donate to local charities. “This will allow all payroll deductions earmarked by employees for charitable contribution to be tax deductible,” said Styler. LFCU “will match 100 percent of each contribution.” The foundation board is made up of 13 employees who volunteered for the positions. The terms will be staggered and in the second year of the foundation’s operation, all LFCU employees will be eligible to throw their hat in the ring for election. Foundation Vice Chair Kara Fitzgerald and board member Midori Reed explained how they went about selecting the charities that would receive the foundation’s largesse. “We started with about 20 charities,” Fitzgerald said, and each was asked to provide information about their organization. “We actually went and visited about 10 places to see what would be the best fit,” added Reed. “We wanted charities where employees could volunteer easily.” That meant finding groups that had opportunities for volunteerism and were geographically accessible. In addition to supporting the charities financially, LFCU gives each employee up to eight hours per year to volunteer on company time. “We deliberately chose charities that were not big national entities,” Styler said. “We wanted to make a difference in the local community by supporting worthwhile local charitable organizations.” The four that were selected are Penny Lane in North Hills, a foster care/adoption support center; weSpark Cancer Support Center in Sherman Oaks, Burbank Temporary Aid Center, and the Santa Clarita Valley Committee on Aging Corporation. Most of LFCU’s workers hail from around the valleys, as do nearly 80 percent of the credit union’s members. Fitzgerald said that in 2009, employees will be able to submit new charities they would like sponsor. On Dec. 7, the foundation sponsored a sign-up event where employees could get assistance in filling out their payroll deduction forms and meet representatives from the four foundation recipients. After the event, community relations specialist Alethia Calagias said she was very pleased with the turnout. “On the first day of enrollment more than 30 percent of LFCU’s staff signed up.” Rotary Assists Neighbors Beginning in January, Calabasas residents experiencing temporary misfortune such as a devastating illness, unexpected death in the family or personal disaster will be able to receive a variety of services including counseling and financial assistance from the Calabasas Rotary Foundation. Thanks to a $25,000 grant from the City to fund a service grant agreement, Calabasas Mayor Pro Tem Mary Sue Maurer said in a prepared statement, “Now residents can turn to the Calabasas Rotary in a time of extraordinary need to find helpful information, solace and some short-term relief during a financial crisis.” Glendale Bank Adopts a Family Rather than having a company gift exchange, the employees of America’s United Bank decided to adopt a needy family this holiday season. The recipients of their largesse were recommended by the New Horizons Family Center, a non-profit Glendale social service agency. The family selected a single mother and her two children, ages 5 and 7 had sought refuge at New Horizons when they became homeless. AUB donated toys and clothing for the children; furnishings and appliances for the family’s new apartment; and clothing and $250 for the mother. Feeding the Needy Blue Cross of California donated $30,000 to food banks throughout California in December including $5,000 each to the Downtown Women’s Center and Fred Jordan Missions, which both provide assistance to Skid Row residents. Better Christmas in the Barrio Keyes Automotive Group was the title sponsor for the 2007 two Christmas festivals for El Proyecto del Barrio, a social service agency that provides comprehensive health and human services to the economically disadvantaged. At the events, thousands of toys and food for holiday meals were distributed and medical and dental screenings, immunizations, and information about other available services were given to participants. More than 3,500 members of needy families turned out for the December 15 events in Arleta and Winnetka. INFO BOX Lockheed Federal Credit Union Assets: $2,540,702,264 Members: 99,055 Employees: 380 Chartered: 1937 Headquarters: Burbank, Calif. Branches: Palmdale, Stevenson Ranch, Valencia (2), Pasadena, Simi Valley, Woodland Hills, Westlake Village

More than 400 mom-and-pop businesses closed up shop on Sunday, Dec. 30, at the Valley Indoor Swap Meet on Variel Avenue in Canoga Park. The six-and-a-half acre site is destined to become a 438-unit apartment complex after the property owner Ronald Simms opted to not renew the lease and sold to a Texas developer. The publicity, promotions and pending demise of the facility drew an estimated 25,000 shoppers on the final weekend. Crowds came to say goodbye to long-time vendors and sift through bargains from among the merchandise of businesses that had until the following Monday to vacate. The onsite ATMs ran out of cash both days. Live music serenaded those wandering the aisles and free food fed those willing to stand in line to get it. Nearby, the Swap Meet’s owners discussed the end of an era. “We’ve had 3,200 vendors since we moved here in’86,” said Glenn Malkin, president of Metropolitan Marketing Inc. Malkin stood, along with fellow owners Ron Wolfe and Stuart Siegal the latter dubbed the mayor of the indoor marketplace and greeted well-wishers, longtime shoppers and onetime employees. Wolfe remarked that the unique combination of price, space, zoning and available parking was unlikely to overlap again. “I think the time has passed for things like this in the West San Fernando Valley,” Wolfe said, and it’s a “good year’s process” to get one open. Malkin said, “Customers love the term ‘swap meet;’ cities hate it,” alluding to the low demographic impression people have of the businesses. “We were the first to have an indoor swap meet in the city of L.A.,” Malkin said, noting that they’d first established this business across Victory Boulevard in 1983 where The Home Depot now stands. “We provide insurance, utilities, security, maintenance, promotion and help with the licensing for the city and state,” Malkin said. “Everything for business except stocking the goods,” he said. Wolfe noted that the process is particularly well-suited to new entrepreneurs. “We’re an incubator for businesses,” he said. Metropolitan also runs similar operations in Panorama City and Pomona. Malkin estimated perhaps as many as 30 of the vendors from the West Valley site would move to Panorama City. A couple dozen vendors had posted signs they’d be relocating to a similar facility at Vineland Avenue and Sherman Way in North Hollywood. Vendors slashed prices on their goods. Clothing prices were reduced to sell: $10 T-shirts for $3. At another booth, shirts were two for $5. Many vendors were too busy, either selling or packing, to chat with customers or the media representatives wandering the aisles. Patrons were buying armloads of used books from Duke Daneault, where he’s had his “Duke’s Books” shingle up for 15 years. The hand-corrected sign displayed the spiraling discounts: 50 percent off was crossed out in favor of 75 percent off, which was scratched out to say “$1 max. price.” “I found the secret of selling a lot of books is to give them away,” Daneault said, his shirt pocket overflowing with folding money, a literal handful of singles, fives, tens and twenties. His future was unclear, he said, until he found another business to buy or sell. His leftover books would have a home, however. They were being donated to the Friends of the Platt Library in Woodland Hills, where a book sale was planned for the next week and used books are sold onsite. Stephanie Levy is planning on taking her figurative ceramic business into a storefront location on Ventura Boulevard. From a business that grew out of her collection of figurative teapots, she’s been moving some of her inventory on eBay, but she’s seeking a more retail presence. “Figurative ceramics is something I love.” Her customers are “devastated,” Levy said. “Some have said ‘you’ve been here longer than I’ve been alive.'” Sheryl Piland’s hair extensions business, dubbed Thair’py, has been a going concern for about four years. She plans on working out of her home to service her customers, until she can find a place for her business to land. She waxed philosophical about the closure of the marketplace. “This was a family-oriented place, with a wider variety and different kind of merchandise than at a mall,” Piland said. “Change happens. One door closes and another door opens. Trouble is many people didn’t have time to find another door,” she said. Jehan Gasser lives in an apartment complex across the street. She said she was resistant to the swap meet when it moved in over 20 years ago. Now her granddaughter, Sarah Wells, helps Piland with her business. “I’m used to it and now I’m sad that it’s going,” she said. Dorothy Stone and her daughter Ilene Dustin said they’ve been shoppers for 15 to 20 years. “There’re so many places under one roof,” Stone said. “We’re getting on every mailing list we can,” Stone said. “We’re quite upset,” Dustin said. “It’s a great place to shop,” then, correcting herself said, “It was a great place.” Shopper Val Werlich said she drove in regularly from Westlake Village for almost 25 years. “They have everything under the sun, she said. “Elegant stuff, not just junky stuff. I’m sad to see it go.” Werlich said she can well afford to shop anywhere, yet “We’d bring European guests here. I’ve traveled the world and this is the best place for shopping…” Hours later she found a reporter to add more endorsements than she had mentioned previously: “My husband would come to a masseuse here, to get rid of headaches, for $12. My daughter bought a fine Italian leather coat, unlike anything you could get anywhere.” John Adair has been supplementing his mortgage broker business for six months by selling original motivational posters from a booth and says he’s done a “good business. I haven’t broken any records,” but he’s encouraged enough to expand his line which he intends to take online and into various brick-and-mortar locations. “I have 35 more that are ready to go.” The end-of-the-year crowds had been good for the Peruvian Arts & Crafts booth of Rosa Buczko, where the increased attention brought out many customers. Her husband Emory said, “December was great.” The leftover stock of handmade, imported jewelry and crafts was destined to “go in their garage.”

Many Californians I speak with seem to agree that health insurance for all California residents is seriously needed for all of us to continue to enjoy quality health care and to preserve our state’s healthcare industry, a substantial component of our economy. There are, of course, different opinions as to how to accomplish that. Assembly Speaker Fabian Nunez and Gov. Arnold Schwarzenegger introduced a plan in December to extend health insurance to 3.6 million Californians that are currently without coverage. The plan would require most Californians to obtain private medical insurance. To get to the voters, the plan, which was approved by the state Assembly, will also require approval by the state Senate. According to Senate President Pro Tem Don Perata there are serious concerns in the Senate over the plan’s effect on state finances. If the Senate approves the legislation with significant changes, the initiative will require re-writing. If the plan does get on the ballot it will face significant opposition due primarily to the proposed funding mechanism which includes a requirement that employers spend from 1 percent to 6.5 percent (depending on the size of their payroll) of their payroll costs on healthcare for their workers, and approximately doubles the cigarette tax by raising it to $1.75 per pack. Strong opposition is anticipated from state business groups, the tobacco industry and drug companies. Another expected opponent is Blue Cross, the state’s largest insurer. That opposition appears to be due to plan provisions that bar insurance companies from denying coverage based on existing medical conditions and requires at least 85 percent of health insurance premiums to be spent on medical care. Although Blue Cross is expected to oppose the plan, Kaiser Permanente and Blue Shield currently support it. An additional funding component is a $2.3 billion tax on hospitals. The hospitals support the plan which will use these funds to pay for increased Medi-Cal payments to doctors and institutions that help the poor. The tax will also qualify California for $2.3 billion in matching federal funds. I know that the Governor has worked very hard to develop a plan that will be successful and I am sure that many funding sources have been considered. However, I don’t remember hearing about consideration being given to the alternative I will suggest. My suggestion will serve several purposes. It will provide funding for health insurance, help further the efforts toward making California “green,” and reduce our dependence on fossil fuels. My suggestion is to levy a per-gallon “gas guzzler” tax surcharge. Unlike the cigarette tax, the “gas guzzler” tax would not prey on victims of addiction. It is strictly a matter of choice: Do you wish to drive a gas- guzzling and probably greater polluting (and thus greater health risk) vehicle and pay a tax to do so, or do you wish to drive an efficient vehicle and avoid the tax? Although it is unlikely that too many people who desire non-efficient luxury or sport-utility vehicles will change their course for a surcharge of, say, 25 cents per gallon, if they do, and the revenue begins to shrink, the surcharge amount on the remaining gas guzzlers can always be increased to cover the shortfall. Based on the information I was able to locate (which is a bit stale), in 2000 the number of registered autos and trucks was approximately 28 million. Other statistics indicate that at least 75 percent of California vehicles do not exceed 30 mpg (“gas guzzlers”). If we assume for argument’s sake that approximately 50 percent of trucks are used as passenger vehicles (SUVs, light pick-ups, vans etc.) and operate on gasoline, as of 2000 there were approximately 22.5 million passenger vehicles operating on gasoline. If 75 percent of those, or almost 16.9 million, are “gas guzzlers,” and if the average gas guzzler is driven about 15,000 miles per year and gets 18 mpg, the average number of annual gallons used by gas guzzlers is approximately 14 billion gallons (total gallons sold in California in 2006 were 15.8 billion). Therefore, if each gallon used by a gas guzzler vehicle was assessed a $0.25 surcharge, the revenue generated by this tax would be $3.5 billion annually. This would cover approximately 25 percent of the estimated $14.4 billion cost of the healthcare plan. Based on statistics I have seen, this is approximately $2 billion more than the amount of coverage that can be anticipated by the additional cigarette tax. To administer the gas surcharge program perhaps there could be separate gas pumps with different size hose nozzles and the gas guzzler cars could be equipped with the same size receiving end (either factory or dealer installed). This would obviously have a front-end cost that the cigarette tax would not, but I believe the result would be far better for the future of our healthcare, our environment and our economy. Gregory N. Lippe, CPA, is Managing Partner of the Woodland Hills-based CPA Firm of Lippe, Hellie, Hoffer & Allison, LLP, 1st Vice-chair of the Valley Industry and Commerce Association (VICA) and a Director of First Commerce Bank.

Faced with a change in audience viewing habits, the CMP Entertainment Group needed to change its strategy to reach people with their trailers and television campaigns for feature films. Computers and portable devices are supplanting the living room TV set as the main means to watch entertainment which in turn reduces the importance of the 30-second television commercial. A new strategy led Burbank-based CMP to acquire Deadline Advertising, a Web and print design agency responsible for the revamped Disney.com and Disneybooks.com Web sites, online film promotion campaigns and online gaming sites. The buyout of the West Los Angeles-based Deadline satisfies the goal of CMP becoming a full service agency for promotional campaigns in both traditional and new media. They aren’t the first firm to employ what’s called 360-degree thinking but it’s a necessary step, said Craig Murray, the agency’s founder. “It’s our desire to bring everyone together in a room,” Murray said. “Instead of working independently, we work under one roof and say here is the movie and we are all going to attack it together in an integrated sense.” <!– 360: Tehrani (left), Murray and Parstabar. –> 360: Tehrani (left), Murray and Parstabar. Acquiring Deadline Advertising concluded a year-long search for the right partner already working in the online space. Smaller firms did great work but were not prepared for the type of intensity that is the world of movie marketing, Murray said. CMP and Deadline worked together for six months on projects for clients from both agencies. That test period showed the firms brought out the best in each other. “Their culture and their mindset [agree] with ours and what it takes to come up with a team effort,” Murray said. Founders Amir Parstabar and Jay Tehrani remain as co-presidents of Deadline and will oversee a facility and personnel expansion at its West Los Angeles offices. The agency currently employs 30 people. Murray’s company includes many of the major studios on its client list. They have devised campaigns for “Enchanted,” “Ratatouille,” and “Transformers.” Deadline has done work for video games released by Microsoft and Sony, and for studios and networks that CMP has not often worked with. With its expertise in online and viral campaign Deadline adds new links to the marketing chain. True 360-degree thinking starts before the camera begin to roll on a feature film, Murray said. Crews are sent out to capture behind-the-scenes footage and interviews that are later used across the entire campaign. Multi-purposing a few minutes with a major star for a TV spot, an electronic press kit and for online use is not only an efficient use of time but also money. Stretching the dollars is never a bad thing in Hollywood. “Certainly that is on everyone’s minds these days,” Murray said. Visual Effects White Papers Due The Visual Effects Society will publish a series of white papers this year to better educate the entertainment industry on the business and practice of visual effects. The first, “The State of VFX” comes in March from the Encino-based society. The publications will focus on the eroding lines of the production phases; the demands of new roles in the production process; and industry misconceptions that visual effects can be done easily, quickly and cheaply. “The State of VFX” includes information and opinions from the 2007 Visual Effects Society Think Tank made up of leaders from the visual effects and software industries. “This will be the beginning of an important industry-wide dialogue lead by the practitioners who experience these changes on a daily basis,” said VES Chairman Jeff Okun. “Key issues need to be addressed now, not only within the visual effects industry, but as part of an industry-wide initiative to move the art and business of filmmaking forward.” Initial analysis of the research done for the paper indicates a majority of the entertainment industry does not have an understanding of visual effects; guilds and societies need to come together to address the key issues; and educating decision-makers at the studio level about the visual effects production process is crucial. Mandalay Merges With Mobile Content Sherman Oaks-based Twistbox Entertainment will merge into Mandalay Media Inc., upon completion of an agreement between the two companies. Twistbox, a producer and publisher of mobile content, will become a wholly-owned subsidiary of Mandalay Media, a publicly traded development stage company. Shareholders and other security holders of Twistbox will receive shares of common stock in Mandalay Media. Twistbox CEO Ian Aaron will continue in that position after the merger completes and will be appointed to the Mandalay Media board of directors. The closing of the deal is expected in the first quarter of 2008. Staff Reporter Mark Madler can be reached at (818) 316-3126 or by e-mail at [email protected].

BANKING John N. Sinnema was named vice president and manager of Union Bank of California, Toluca Lake. As a senior staffing specialist for Union Bank, Sinnema began his career in the banking industry in 2002. Within a year he became manager of the Atwater branch, after going through the bank’s management training program. Most recently he managed the Westwood branch. Erik W. Daniels has been named as executive vice president and national sales manager for the Small Business Administration division of U.S. Bank in Glendale. Daniels was most recently senior vice president and western regional sales manager for Business Loan Express in Alhambra. ENTERTAINMENT DreamWorks Animation SKG announced the promotion of two of its executives to co-presidents of production for feature animation. Bill Damaschke and John Batter will oversee the creative production and development for the studio, the studio’s overall operations and its state-of-the-art animation tools and technology. Damaschke will also serve as president of live theatrical productions. Both gentlemen joined DreamWorks in 1995. A.D. “Bud” Albers has been appointed as chief technology officer of the Walt Disney Internet Group. In that position Albers is responsible for leading technological breakthroughs on existing platforms as well as developing cutting-edge new technology solutions in support of the company’s new media technology needs. Before joining Disney, Albers served as senior vice president and chief technology officer for MediaNet Digital. INSURANCE William J. Owen joined Zenith National Insurance Corp. as senior vice president of investor relations. Owen had previously served as chief financial officer at Zenith. LAW Horvitz & Levy announced the hiring of two new associates, Kris Bahr and John Querio. Bahr received his law degree from J. Reuben Clark Law School at Brigham Young University. Prior to joining the firm he clerked for the Honorable Jill N. Parish of the Utah Supreme Court. Querio previously worked as an associate at Sonnenschein, Nath & Rosenthal. He is a graduate of the Stanford Law School. In addition, Jason Litt and Jeremy Rosen were promoted to partners at the firm. Litt has handled numerous cases before the California Court of Appeals and the U.S. Court of Appeals for the Ninth Circuit. He is a graduate of Harvard Law School. Rosen has been lead appellate counsel in dozens of appeals in a wide variety of areas. He is a graduate of Duke University School of Law. MANUFACTURING Blake Augsburger has been named as country manager for Harman USA, a division of Harman International Industries Inc. with offices in Northridge. In that position, Augsburger will manage support functions that cross divisional and business lines. He joined Harman International in 2001. The company also announced the appointment of Gary Steel to the board of directors. Steel serves as executive committee members at ABB Ltd., and has a background in human resource development, restructuring, and corporate governance. MARKETING David Yovanno has been promoted to chief operating officer of U.S. Media at ValueClick Inc. In that role Yovanno has overall responsibility for the company’s U.S. display advertising, lead generation and comparison shopping businesses. Yovanno joined ValueClick in 2000 and previously had been general manager of ValueClick Media. REAL ESTATE The Simi Valley/Moorpark Association of Realtors has announced its annual honors. Stan Rector of Troop Real Estate was selected as SVMAR “2007 Realtor of the Year.” He served as director and committee chairperson from 2004-2006 with SVMAR. “Being honored by your peers is the ultimate recognition,” said Rector. Leanne Alva of All-Valley Escrow is the first escrow officer to be named as the trade group’s “Affiliate of the Year” for 2007. Alva has been an escrow officer since 1997, joined the firm in 2005. Some of her services to SVMAR include affiliate chair in 2006 and 2007, and installation chair in 2006. SALES Dan Leal has taken over responsibilities as sales director of Internet radio and television station KSEX. Leal is an adult entertainment producer and also has 10 years experience in sales management for technology-based companies. TECHNOLOGY Ron Torten has been appointed as vice president of worldwide sales at Inphi Corp., a semiconductor manufacturer. In that position, Torten oversees the company’s entire sales organization, including a network of direct and independent sales force, manufacturer’s representatives and distributors in North American, Europe and Asia. Prior to joining Inphi, Torten was CEO at NemeriX.

When Ed Bjurstrom, a former vice president of operations for Amgen, left the bioengineering giant in 2005, he set out to establish an organization that would provide antiretroviral drugs to AIDS-ravaged African nations. “We made proposals to several different governments in Africa, but AIDS is an issue that’s pretty highly politicized, and we were just too small. Yet, from our visit, we knew people were dying and needing help,” Bjurstrom said. “We visited Ethiopia, Zimbabwe, Zambia and South Africa. We met government officials, doctors. We visited people dying of AIDS in mud huts. We really got a good feeling of what the medical needs are.” From that time forward, Bjurstrom and his wife, Wendy, decided to establish an organization specifically focused on partnering with medical clinics in rural Africa. They began their Westlake Village-based foundation, CareNow, in April of 2006. It recently shipped, in partnership with an organization called Giving Children Hope, $750,000 worth of equipment, supplies and medicines to a medical clinic that treats largely AIDS-infected children at Lily of the Valley Endeavor orphanage in rural KwaZulu-Natal, South Africa. And that’s not all. The government of Zambia recently asked CareNow to take over clinics in that country. Antibiotics, cardiac medications, pain relievers, examination tables and sterilization and laboratory equipment were among the items included in CareNow’s recent shipment to South Africa. While Giving Children Hope secured the container and contents, CareNow covered the costs for the container, the contents and shipping. Bjurstrom estimates that his foundation managed to send $750,000 worth of items to the medical clinic for about $30,000 to $40,000. “That’s remarkable leverage, much better than having a clinic buy at regular prices,” he said. The medical clinic that received the CareNow shipment also has a Valley connection. It was built with funds from the Lily of the Valley Enterprise of Thousand Oaks. Providing the medical clinic the equipment needed to offer treatment on a regular basis in KwaZulu-Natal makes a huge impact, Bjurstrom said. That’s because a considerable number of people there have no transportation other than their feet. Furthermore, “In this kind of environment, where it’s rural, and they have a lot of unemployment and a lot of illiteracy, if a construction worker drops a brick on their foot, that’s kind of life threatening if they don’t have anyone who knows how to take care of it,” Bjurstrom said. A serious infection could arise, leading to gangrene and eventually to amputation. Bjurstrom expects about 25,000 patients to visit the clinic per year. There are plans to develop another such clinic in South Africa as well. “Generally, if you look at the demographics, about 60 to 70 percent of patients will be women and children under five years of age,” Bjurstrom said. Accordingly, the shipment of pharmaceuticals to the clinics may help curb infant mortality in the area. Via its mobile clinic there, CareNow attracted the eyes of dignitaries in Zambia, a country that borders on Zimbabwe. Composed of a nurse and a midwife, the medical clinic travels to four different locations to serve the medical needs of Zambians. At present, CareNow is raising money to support an ongoing operation there, Bjurstrom said. While CareNow functions to treat the basic health needs of Africans, Bjurstrom believes the role it plays is essential. “A lot of times you read about dramatic situations where there’s a life threatening illness, and they airlift someone from Africa to the UK,” he said. “What’s equally important is the day-in and day-out work of people who are cleaning cuts, setting bones; really simple things, but they really make a difference in the quality of life of the whole community. They’re not really dramatic, but they’re really important, and they really make a difference.” Bjurstrom said that he’s often been asked why he’s not choosing to use his expertise to help Americans rather than Africans. “There’s a lot more help already in the U.S.,” he replies. “There’s more people who need help in Africa. The need is pretty much endless. It’s important that Africa be a stable part of the global community. There are a lot of resources, minerals that come from there If we don’t do anything to help, what will future generations think? You can’t turn your back on that kind of need when it’s so obvious.” For more information on CareNow or to make a donation, visit www.carenowfoundation.org.