Economic Apocalypse: Eight Steps Your Company Can Take to Survive It

March 11th, 2008

The private business sector is in trouble, and the final showdown is coming. If you’re one of the 75 percent of mid-sized companies that’s not increasing in value, it’s time to adapt or die. Private business guru Rob Slee explains what you need to do right now to stay alive.

 

Charlotte, NC (March 2008)—We all know it’s coming. Signs of the apocalypse lurk everywhere: the recent sub-prime meltdown, low consumer confidence, rising energy prices, high unemployment, and so on. Factor in the always-on global economy and all the shake-ups it has caused and it doesn’t take a rocket scientist to know your future is precarious. In fact, the (metaphorical) locusts are hovering over your company. If you aren’t increasing the value of your holdings—particularly if you’re a privately owned middle-market company—your days are numbered. Heck, maybe even your hours.

 

Rob Slee wants to know:  what are you doing about it?

 

“As a business owner or manager, you know things are vastly different from the way they used to be,” says Slee, author of Midas Managers: How Every Business They Touch Turns to Gold (Burn the Boats Press, 2007, ISBN: 978-0-9790478-0-0, $27.00). “The old rules just don’t apply anymore. Maybe you’re floundering desperately for some sort of map, or you’re hoping the government will rescue you, or maybe you’re simply in denial and on autopilot. Regardless, now is the time to get serious about re-engineering your company to compete in the global economy.”

 

While large publicly held companies are faring well in global markets, mid-level private companies cannot say the same. As a group, they simply aren’t globally competitive, even if they do outsource their manufacturing. (If you buy globally and sell domestically, you are at best reaping only half the benefits of a global economy.)

 

Here’s the really bad news: privately owned businesses generate more than 50 percent of America’s GDP and account for 80 percent of new jobs. And currently, some 75 percent of owners are not increasing the value of their firms.

 

Warns Slee: “I’ve said it before and I’ll say it again: if the private business sector fails, America fails.”

 

Scary stuff, for sure. But Slee isn’t here merely to be a doomsayer. Yes, he does believe the sky is falling, but he assures us that it won’t fall on everyone. And while it’s true that you can’t save the world—or America, for that matter—you can save yourself.

 

What you have to do is emulate the business superstars Slee calls “Midas Managers”—the less-than-one-percent of all business people who intuitively know how to create wealth and who’ve proven their success is more than luck by repeating it again and again. (Think Warren Buffett, John D. Rockefeller, Andrew Carnegie.) It’s not that you can become a Midas Manager—the vast majority of us simply don’t have “the right stuff”—but you can study what they do and learn their tricks.

 

Slee offers the following tips for reinventing your business:

 • First things first: get out of denial. Chances are, you don’t want to hear Slee’s message. Few business owners do. After all, many of them built up highly prosperous companies playing by The Old Rules and they’re loathe to change now. (Indeed, says Slee, many older owners he talks to do the equivalent of covering their ears and singing “la la la la la!”) It may not be “fair” that everything you’ve built up no longer works, but wishing won’t make reality go away. If you’re going to survive, you must move to a conceptual business model, and that means making some hard choices.

 In Midas Managers, Slee tells the story of Mann Wood Products*, a company founded in the late 1950s by Woody Mann. When Woody’s son Chester took over the company, it was an integrated supplier that did everything from logging forests that it owned to sawing, chipping, kilning, planing, and moulding all that wood. One day in the early 1990s, Chester got a call from a representative of Brazilian Forest Products. The rep revealed that his company’s products were selling for about 15 percent less than Mann’s manufacturing costs.

 “At first, Chester tried matching the Brazilian company’s prices for a year, but all that did was generate $5 million in losses,” says Slee. “But once he got out of denial, he reconceptualized his process chain. Instead of manufacturing boards, he bought them from Brazilian and its competitor. He decided to mould the boards for next day/next week delivery to home builders. He started buying pulpwood from independent loggers to feed the chip mill. And he reduced Mann Wood Products to just two divisions: moulding and chipping.

 “In the end the company wrote off about $1.5 million in assets, reduced head count by more than 100—including aunts, uncles, and cousins—and even forced Momma Mann to retire,” adds Slee. “Sales went from $85 million to just $22 million, but instead of losing $5 million per year, Mann was now earning $3.5 million. Now I’m sure firing family members was not fun, but it had to be done to save the company. If Chester can fire Momma, you can do what you have to do as well. Just be sure to get out of denial before it’s too late.”

 • Get comfortable with conceptual thinking. Slee says we are in the Conceptual Age, which is defined by multi-dimensional (right brain) thinking. Like Chester Mann, today’s mid-level private business owners must conceptualize their way to success. Operational excellence is no longer enough. In the Conceptual Age, it is merely the starting point. Machines, capital, and employees are no longer the main factors in creating business wealth. The biggest is the manager’s ability to conceptualize solutions. Walt Disney would be proud: our imaginations are now the major constraints on wealth creation.

 “It’s ironic that so many of us were told as children to avoid artistic careers in favor of a more ‘reliable’ future in business,” notes Slee. “Now, here we are living in an era when our ability to be ‘artsy’ will in large part determine our success in business. In a world where the major resources are available to everyone, it is the ability to do more with less that separates the winners from the losers. That’s what conceptual business models are all about.”

 • Raise your private finance IQ. Of course, all this talk of artsy-ness doesn’t mean you can throw numbers out the window. Remember, what we’re really talking about is value creation, and it’s fundamentally a finance activity. As a business owner you have to understand finance; you simply can’t leave it up to your controller or outsource it to a CPA. (What they practice isn’t really finance, anyway, says Slee: it’s accounting.) Understanding how private finance works is the path to wealth. Once you have a grasp on the three pillars of private finance—value relativity, cost of capital and value creation, and transfer value—a whole world of financial decision making opens up.

 “It is possible to create wealth by planning or buying in one value world and then selling in another,” says Slee. “For example, buying a business in the bankruptcy world and selling in the market value world usually creates wealth. Planning in the fair market value world and then going public in the IPO world also creates wealth. There is no substitute for knowledge of value worlds, cost of capital, and transfer methods…so if you don’t have it, go get it now.”

 • Pick apart your process chain. Figure out exactly what your company does, step-by-step, from inception to customer. To revisit our traditional wood-processing domestic process chain (à la pre-Brazil-call Mann Wood Products), timber is harvested by American loggers; American logs are sawed, then kiln-dried; dried boards are then shipped or further processed. Obviously, your process chain doesn’t look like this—you wouldn’t be in business if it did—but you may have a few steps being handled in a way that’s nearly as inefficient.

 • Identify the steps that involve your intellectual capital. Outsource everything else. It really is that simple. In a conceptual business model, you own only your intellectual capital: the know-how and skill sets that allow you to be successful. You control—not own—the process chain. You’re essentially the quality control manager. As Slee likes to say, you should have your fingers in everything, but no fingerprints on anything.

 “Most companies have ten to twelve process steps in their process chain,” he says. “Usually no more than three to four of these steps are intellectual capital. For example, in the world of investment banking, the first couple of steps of the process chain are intellectual capital: edu-market the client; negotiate the fee agreement. These must be owned. The middle steps, such as: create memorandums; identify prospects; run the auction, can be outsourced.

 “Ultimately, you will want to leverage your intellectual capital by at least a 5:1 ratio, or better yet, 10:1,” adds Slee. “Conceptual business models allow you to do that.”

 • But don’t just outsource. Partner. Many companies will tell you that outsourcing is no panacea. It can fail, and for a variety of reasons. But your chances of success increase dramatically when you join with a qualified and motivated partner. Slee tells the story of Scott Livingston, owner of Cosmetic Components Corporation, who adopted a “design and deliver” business model. His company designed parts for beauty products, outsourced the manufacturing, and then delivered finished products to customers.

 CCC recruited offshore factories to supply 100 percent of its need in a particular product area. All of Scott’s compacts and jars came from one company in China, all extruded tubes were produced by one company in Mexico, and all lipstick cases were made by a company in Thailand. Scott negotiated exclusive supply agreements that prohibited his partners from supplying parts to his competition and prevented them from selling directly to consumers. The company received shipments in leased space in public warehouses and then broke them apart for customers, shielding the customer from the manufacturer.

 “This manufacturing arrangement solved several problems for Scott,” Slee explains. “First, it eliminated the need for him to invest in manufacturing, which made his model both low-cost and scalable. Second, Scott’s partners were extremely capable of producing the required parts, so he didn’t have to worry about supply disruptions. Third, Cosmetic Components was usually the largest or second-largest customer for a partner so it got rapid responses anytime there was a problem. Fourth, with geographic diversity, Cosmetic Components was not overly exposed to fluctuations in weather or currency.”

 The moral? When you’re seeking out partners, don’t just figure out who can do it most cheaply. Think carefully about all the variables before you make a decision. And figure out why the partner would want to do business with you—if arrangements aren’t truly mutually beneficial, they won’t satisfy either party.

 • Become a niche-aholic. A niche can be defined in several ways. It might be meeting an unmet customer need, filling a hole in the market, or providing a product or service that is defensible, sustainable, and delivers a return greater than the underlying risk. For example: one manager of an industrial distribution company once heard a contractor mention that it would be great if the distributor could create and supply stock lists from job blueprints. The manager immediately recognized that this service could create a competitive advantage and would allow him to position his company in a new, lucrative, and sustainable niche.

 Here’s the thing, though: one niche is not enough. “During the 1980s a middle market company could develop a niche with $50 million per year in sales and defend it,” says Slee. “Today, if a mid-sized company gets much above $10 million in sales from a niche, the world shows up, and they’re not looking to buy. This is why most successful middle market companies are really amalgams of niches hanging from an intellectual capital tree. And it’s also why successful managers spend half their time tending to current business and the other half in search of new niches.”

 Draw up lists of your company’s core competencies and criteria for niches that will maximize them. This will enable you to know a promising niche when you see it or know what to do to make it one. Niching is not big-game hunting. It’s listening to low-voiced comments and offhand questions from customers. Niche-aholics take what the market will give them, and in today’s economy, that is either high volume but low profits or low volume but high profits. It’s okay to hunt for niches with sales of $1 to $5 million. In some cases, it’s the best strategy of all.

 • Don’t push your products onto the market. Let them be pulled. If you are trying to convince potential customers that they need your product, you’re on the wrong track. The Old Rules say that you should control your resources. The New Rules say just the opposite. Instead of dictating solutions, listen to your customers and react accordingly. The command-and-control mindset is obsolete. “A wise business owner once told me that successful service providers create a condition where the door to their office swings in, not the other way around,” writes Slee. “In other words, the client comes to them.”

 Here’s how to create a pull business model:

 

  1. Determine how to make your door swing inward. Who needs your products or services to meet their goals?
  2. Create a platform that organizes and feeds a niched, networked community of these potential customers. Give them enough value-adding tools—without restrictions—to collaborate and innovate. Make them believe it’s in their best interests to contribute something of value to the community.
  3. Collaborate with partners. Leverage your partners’ unique intellectual capital to build your platform. Choosing, enticing, and rewarding partners is a key to success in the Conceptual Age.
  4. Dare to share. Innovation within networks occurs when the companies with platforms share capabilities.

 

If your head is spinning right now, you’re not alone. You have a decision to make and your window of opportunity is closing. Slee says that many, if not most, business owners and managers simply can’t—or won’t—change. But there are survivors in every age—men and women who open their minds, rise to the challenge, and come out swinging. Hopefully, you’ll decide you’re going to be one of them.

 

“Today, we all bear personal responsibility for re-thinking our behavior to help us compete in the Conceptual Age,” concludes Slee. “This will be difficult. It requires us to think strategically. It requires us to scale an unending series of walls. It’s a chess match on steroids. It’s a high-stakes poker game. It’s a game we must win if we want to continue to succeed in business.”

 

# # #

 FOOTNOTE: *Names of companies and individuals have been changed to protect the privacy of Rob Slee’s clients.About the Author:

 Rob Slee is Managing Director of Robertson & Foley (robertsonfoley.com), a middle market investment banking firm. Rob owns equity positions in a variety of mid-sized private businesses. His other book, Private Capital Markets, is now considered the seminal work in finance for private companies. Rob can be reached at rob@robertsonfoley.com.

 About the Book:

 Midas Managers: How Every Business They Touch Turns to Gold (Burn the Boats Press, 2007, ISBN: 978-0-9790478-0-0, $27.00) is available at bookstores nationwide and from major online booksellers.

 For more information, please visit midasmanagers.com and robertsonfoley.com. 

Money-saving green landscaping

February 11th, 2008

Dear EarthTalk: Is it possible to landscape my property in a green-friendly way? I would like to create a more natural and wildlife-friendly backyard, but I don’t want to break the bank doing it. Are there any tax incentives for completing such projects? – Michal Avraham, Olive Branch, MS

One common misperception about adopting green practices around the home is that doing so will cost more money. But this may be true only in the short run. There are certainly some up-front outlays to converting a conventional backyard into a more environmentally friendly space (like any landscaping job), but homeowners should be able to make their money back within a few years through savings on their water and yard service bills alone.

Landscapes designed with the principles of nature and wildlife habitat in mind are often referred to as “naturescapes” (or “xeriscapes” when they also require little water to maintain). They usually replace most lawn grass and instead populate space with native plants that are attractive to wildlife for food or shelter.

According to the nonprofit PlantNative, maintaining a green backyard can cost up to 90 percent less than keeping up a traditional lawn-based landscape. “Since naturescapes effectively take care of themselves, there is little or no maintenance and hence little or no maintenance cost,” says the group. The average American lawn costs about $700 yearly to maintain, says PlantNative, which also points out that the average household lawnmower is used upwards of 40 hours a year, the equivalent of a full work week.

Melissa Santiago, a researcher with Ohio State University who authored a fact sheet on the benefits of managing property for wildlife, couldn’t agree more: “Maintaining wildlife habitat or other natural areas can be a cost-effective approach to land management.” She recommends that landowners with room to spare plant one or more rows of native trees and shrubs as so-called “shelterbelts” that provide wildlife habitat and also provide shade in summer (to reduce air conditioning costs) and wind resistance in winter (they have been shown to reduce heating costs by as much as 30 percent).

Tax breaks for greening up your residential landscape are few and far between, but do exist. The state of Indiana offers tax breaks to landowners who convert a minimum of 15 acres over to habitat suitable for native wildlife. Many other state governments offer landowners similar assistance for maintaining habitat for threatened wildlife. And municipalities across the arid southwestern U.S. offer various incentives for homeowners who cut water use, whether through xeriscaping or any other means.

To get started converting your yard over, contact a local nursery well-versed in native landscaping to lend some informal or professional expertise. To find a nursery in your area that fits the bill, consult PlantNative’s free online directory of native plant nurseries. Or, if you want to do your own homework, check out the National Wildlife Federation’s free online Native Plant Guide (which covers the 50 U.S. states) or the Canadian Wildlife Federation’s guidebook Backyard Habitat for Canada’s Wildlife (available in print for $19.95 plus shipping).

CONTACTS: PlantNative, www.plantnative.org; National Wildlife Federation, www.nwf.org; Canadian Wildlife Federation, www.cwf-fcf.org.

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Environmental festivals and events

February 11th, 2008

Dear EarthTalk: I’ve been reading about various green festivals going on around the country and I want to attend some and get up to speed on environmental issues and products. What are some good ones and how do I stay on top of all the wheres and whens? – Alex, Chicago, IL

Whether you’re a consumer in search of green products and healthy organic foods, an environmental advocate looking to network, or a businessperson who wants to “green up” operations, there is an environmental event out there for you.

One of the best is the Green Festivals series, which appears in an increasing number of U.S. cities every year and is growing in leaps and bounds in attendance. Co-sponsored by two leading national nonprofits, Global Exchange and Co-Op America, these so-called “parties with a purpose” bring together businesses, environmental groups and community organizations working toward the collective goal of “forging a just, sustainable, inclusive economy—a green economy.”

Hundreds of thousands of people from all walks of life have participated in these festivals over the last decade to peruse aisles packed with exhibits, hear speakers, make connections with like-minded folks and indulge in green-themed music, art, culture and food. In 2008, events will take place in Seattle (April 12-13), Chicago (May 17-18), Washington, DC (November 8-9) and San Francisco (November 14-16).

Another event geared toward the green-leaning general public is EcoFest, held every September for the last two decades in New York City. This free event also features myriad commercial and nonprofit exhibits and celebrity speakers and performers. Attendees at EcoFest’s 2008 event will get to check out prototypes of alternative energy vehicles, watch a green-themed fashion show and participate in environmental education workshops, among other events.

One very educational event is the yearly DC Environmental Film Festival, which takes place March 11 – 22 this year in Washington. The festival features 115 documentary, feature, animated, archival, experimental and children’s films, shown at various locations around Washington, including museums, libraries, embassies, universities and theatres. Most are free and many include discussions with the filmmakers and/or scientists and environmental leaders.

Many environmental festivals are broad with regard to topics covered, but several issue-specific and business-to-business events take place throughout the year as well. To key in to these events, go to the Green Fairs and Festivals page at the EcoBusinessLinks Environmental Directory. Examples include Texas’s Renewable Energy Roundup, Colorado’s Rocky Mountain Sustainable Living Fair, Georgia’s GreenBuild Expo, Vermont’s SolarFest, and Croton-on-Hudson, New York’s Great Hudson River Revival, which has been raising funds to protect New York’s Hudson River since the late 1970s.

Green events take place all year long, but a large number happen in the spring to coincide with Earth Day (April 22). Many school and community environmental groups hold Earth Day events every year. To find an Earth Day event near you this coming spring, consult Earth Day Network’s free online database.

CONTACTS: Green Festivals, www.greenfestivals.org; EcoFest, www.ecofest.com; EcoBusinessLinks Environmental Directory, www.ecobusinesslinks.com; Earth Day Network, www.earthday.net.

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Rule #1: Act Like a Lady—Nine Tips to Help Hillary Clinton Win the Presidency

February 8th, 2008

Rule #1: Act Like a Lady—Nine Tips to Help Hillary Clinton Win the PresidencyFor the first time in American history, a woman is in prime position to become the nation’s next president. Roxanne Rivera says Hillary should resist the urge to become one of the boys and should embrace the femininity that helps her stand out from the pack. 

            Albuquerque, NM (February 2008)—The 2008 presidential campaign has already been one to remember, and it will only get more interesting. Perhaps no candidate’s campaign has been as closely scrutinized as Hillary Clinton’s, whose every move seems to be picked apart by her fellow contenders and the press. And as Barack Obama continues to rack up one victory after another, many are wondering how Hillary will deal with the pressure. After all, in this “damned if you cry, damned if you don’t” society, her options seem severely limited.

Roxanne Rivera—a woman with years of experience in a male-dominated industry—warns that Hillary should handle herself with the grace and poise of the fiercely intelligent candidate that she is. Otherwise, she will be tagged with the b-word once and for all, making it difficult for her to win the Democratic nomination. 

            “There has been much debate throughout the campaign about whether or not Hillary should play up her femininity or whether she should just try to fit in as one of the guys,” notes Rivera, a former spokesperson for the New Mexico Republican Party whose website, www.nocryinginconstruction.com, is a great source of information for any woman currently working or planning to work in a male-dominated industry.

“Many have commented that she is fighting a lose-lose battle. If she is stern and serious, she is portrayed as an ice queen. If she shows her sensitive side, she is seen as weak, or worse, manipulative. Sure, these are ridiculous stereotypes, but they’ve been bandied about quite a bit. But what everyone seems to forget or ignore is that there is a reason that Hillary has been so successful: She is a strong, determined, intelligent woman. And I think she should definitely embrace her femininity.”

            Rivera knows what it’s like to fight for success in a male-dominated industry. For twenty-two years she worked with mostly men as the head of her own construction business. She has also spent a significant amount of time researching women’s roles in male-dominated industries and interviewing well-known women who are serious players in their respective testosterone-laden arenas. Her website presents some of the fruits of that labor as it explores her own and other women’s experiences surviving and thriving in industries ranging from construction to engineering to academia.

            “Hillary is the perfect example of what women can achieve in the ultimate male-dominated industry: politics,” says Rivera. “I think many women feel as though she is representing everyone in our gender. That’s only natural. My fear, though, is that as the race gets tighter, she may feel backed into a corner and use tactics that will cause voters to lose focus on the strong, successful woman that she is. I think Hillary should strive to be herself as things go down to the wire, and her femininity is a big part of who she is. I don’t think she should play down that fact.”

Here, Rivera offers some tried-and-true advice to Hillary from one woman in a male-dominated industry to another:

 

Acting like a lady will take you far. Former British Prime Minister Margaret Thatcher was known as a “lady” even while she met the challenges of her office head on. And being a lady didn’t mean backing down from a fight. (One Soviet newspaper of the time even called her “Iron Lady.”) Believing in yourself and in your inner strengths will set you apart as a lady. A lady knows and keeps her boundaries, has infinite grace under pressure, and takes care of herself. A lady never ridicules or bashes other women or men.  A lady makes people feel at ease in her presence.

 

“I think these are rules to live by for any woman and especially for the one running for president,” says Rivera. “Those aspects that define a lady are what will set Hillary apart from her competition. Jacqueline Ingrassia, the first female to win the Triple Crown, said of her career in the male-dominated world of horse racing, ‘It has been a delicate balance of standing up for one’s rights while maintaining dignity and class.’ Those two things—dignity and class—are what can take Hillary to the top.” 

 

Don’t be afraid to say no. At a time when Americans are looking for a presidential candidate who has all the answers, it can be dangerous to decline to answer a question. Hillary is and has already been faced with questions that are purely based on the assumption that she might have a hard time making tough decisions as a president simply because she is a woman. Should she answer all of them? Not necessarily, says Rivera.

 

“Women tend to answer every question asked of them because they do not want to be perceived as incompetent or uncooperative,” she explains. “I suspect this is a challenge that Hillary has faced. On more than one occasion men made assumptions about how good a job I could do in the construction industry because I am a woman. When Hillary is faced with questions that are being asked of her simply because she is a woman, I think she should think before she speaks and weigh the pros and cons of answering. She’ll have to set specific boundaries for herself in this area. Sometimes those types of questions will warrant an answer and sometimes silence will speak louder than words.”

 

Know how to pass the “Can She Take It?” Test. A couple of weeks ago, the big debate with regard to the election wasn’t who had the best answer to this or that question or who has the best healthcare plan or the best plan for getting out of Iraq. No, the big question on the news was: Did Hillary cry or didn’t she cry? It happened after Hillary seemed to tear up while answering a voter’s question about how she kept going during the campaign. And the great debate began. Rivera says the hoopla that resulted was all part of what she calls the “Can She Take It?” Test.

 “The best way to handle the ‘Can She Take It?’ Test is to continue to answer the questions she is asked as openly and directly as possible just as she did,” says Rivera. “Even though ‘No Crying’ is one of my mantras for women, the important thing to note in this situation is that it doesn’t matter whether Hillary teared up or not—and let the record show that several U.S. presidents have cried during speeches!—but rather that she stayed on message and gave a meaningful, honest answer. I’ve found that men, in particular, respect this kind of directness and honesty. And I think if she continues to answer questions from both reporters and voters with those sentiments intact, she will pass the ‘Can She Take It?’ Test every time!”  

Let your emotional intelligence show. Hillary and her opponents have each established that they can be politically smart and manipulative when they need to be. But Rivera says that demonstrating her emotional intelligence will set Hillary apart from the other candidates. Essentially, emotional intelligence is the ability to interpret your own feelings and emotions, gauge the feelings and emotions of others, and then use that information to guide yourself and others toward specific goals. In his book Emotional Intelligence: Why It Can Matter More Than IQ, Daniel Goleman found that women tend to be more empathetic than men and are better at relating and interacting with others.

 

“One of the realities Hillary faces in the male-dominated race for president is that she is held to a higher standard than her male counterparts,” says Rivera. “She is more critically evaluated and is under more intense scrutiny. Fortunately, as a woman she is better able to sense emotions, adapt to situations, and nurture her relationships with potential voters. I think people want a president who cares about their well-being. If Hillary really uses her emotional intelligence to show people that she understands and empathizes with them, she can be viewed as a caring woman who really understands what we Americans are feeling and going through. And she can use that information to become a great leader.”

 

Be flexible. Sure, people want a decisive leader, but as the current administration has shown us, decisiveness for its own sake can get us in a lot of trouble. Continuing to back a decision—the war in Iraq, for instance—without being willing to consider that other alternatives could work can result in scary consequences. Americans want a decisive president, but they want a reasonable one as well. And when people think of a “reasonable” person, they picture someone who thinks rationally, has perspective, and is able to accept her fallibility. A reasonable person exercises sound judgment and has a healthy skepticism.

 

“I think more and more people are viewing President Bush’s unmovable stance on Iraq as being unreasonable,” says Rivera. “Hillary needs to demonstrate flexibility in her beliefs and show the ability to accept the unpredictability of life. She’s often criticized for voting for the war in Iraq back in 2002, and I think she’s right to explain her reasoning behind the decision she made then and the reason she no longer holds those positions. It’s a great opportunity for her to show her ability to be flexible and to make decisions based on what’s really going on rather than on a best-case-scenario situation.”  

 

Always be open and honest. In her political career, it’s likely that Hillary has encountered her share of rude, chauvinistic, stubborn, and unthinking men. Hopefully, she realizes such behavior isn’t characteristic of all men. The candidates she is up against have good reason to try and trip Hillary up any chance they get, but in order to appeal more to male voters, she need only share her thoughts openly and honestly.

 

“If you talk to men honestly and with consideration, they will open up and become less rude, less stubborn, and less unthinking,” says Rivera. “Men, just like us women, like it when someone else is curious about their thoughts and opinions. Ask them what they think about an issue and watch them open up. Be straightforward when you share your feelings and thoughts. When men know that they are being dealt with in a straightforward manner, they will respect you.”

 

Don’t try to think like a man. Hillary has a tough battle ahead of her in that she has to appeal to voters—both men and women—who may not be sure what it will mean if a woman is elected president of the United States. It’s true that she has had more success winning over women voters than male voters—for instance, in a recent USA Today/Gallup Poll, 50 percent of men said they wouldn’t vote for her for president compared to 36 percent of women—but that doesn’t mean she is doing anything wrong. She shouldn’t try to start thinking like a man in order to figure out how to appeal to more male voters. If she does, they’ll know in a second what is going on and will immediately call her out for being insincere.

 

“Hillary can still ‘think’ like a woman and appeal to men at the same time,” insists Rivera. “I did it every day in my construction business. My advice for Hillary would be to remain open to the opinions of the men she encounters and to develop a good sense of humor around them. She also shouldn’t be afraid to laugh at herself when a time calls for it. Hillary can use her experiences as a woman to help her approach issues from different perspectives, and I think that is something that male candidates will have trouble doing. Hillary has the advantage of being a woman while also having the emotional intelligence to better understand why men react and act the way they do.”

 

Learn the intricacies of male/female dynamics. If Hillary is going to be successful in this male-dominated field, she will need a good understanding of how men and women interact. “Here’s what I have learned about men and women during my career: I think men benefit more from male/female relationships than women do,” says Rivera. “Men enjoy the nurturance of these relationships and enjoy ‘confiding’ in women. I’ve also noticed that women are less brutally honest and direct than men. I like the male directness I’ve encountered over the years because I always know where I stand with a man. And both men and women need to feel respected. If potential voters, regardless of gender, feel that Hillary respects their ideas and their feelings, they will learn to like and trust her.”

 

Reach out to other women. Her fellow women will be an important asset for Hillary. Many women are still trying to decide who they should vote for. Hillary should embrace those female supporters that she has already won over in order to garner more support from other women voters. Women are great sounding boards and the more Hillary can interact with and learn from them the better.

 

“Ever heard the idea that people vote for the candidate they would enjoy having a beer with?” asks Rivera. “Well, I think that idea holds true with female voters. I think they will find Hillary more appealing if they feel like she would make a good friend for them. The benefit is that the same characteristics that men find appealing—a decisive nature and honesty, for example—women also find appealing. I think there is a special excitement among women during this political time, because we are seeing one of our own up there taking on the men without batting an eyelash. In the end I think women are sure to be Hillary’s biggest support system, and she should embrace that!”

 

            “This is an exciting time for all women, especially those who are working in male-dominated industries,” says Rivera. “Women have been fighting long and hard in order to get the respect we deserve, and if America elects a woman as president, that will be a huge victory for womankind. Yes, I believe Hillary can win over male and female voters. To do it, she need only let go of the attitude that she is a woman competing ‘against’ men, and think of herself, instead, as a competent, intelligent candidate who happens to be a woman not afraid to embrace the femininity that makes her who she is.”

 

# # #

 About Roxanne Rivera: 

In 1981, using a personal savings of $1,200, Rivera co-founded a sole proprietorship construction service business and grew it to a $13 million company that incorporated in 1989. She oversaw all operations and up to 100 employees plus subcontractors in three offices throughout New Mexico. She wrote, marketed, and secured multi-million-dollar contracts in both the government and private sectors.

Rivera’s key clients included the US Army Corps of Engineers, White Sands Missile Range, the US Air Force, the Defense Threat Reduction Agency, the Department of Defense, Los Alamos National Laboratory, Intel, General Electric, Ethicon, and Rockwell International.

Her construction firm received numerous small business awards, including two Small Business Administrator’s Awards of Excellence and several nominations for Small Business Prime Contractor of the Year. She was named Female Executive of the Year by the National Association of Female Executives in 1995. Her firm was listed in the Top 500 Hispanic-Owned Businesses in the United States for five consecutive years.

Rivera has been appointed to several national advisory committees, most recently appointed by Secretary of Labor Elaine Chao to the National Advisory Committee on Ergonomics where she was the only businessperson on the committee.

She has served on both the Association of Builders and Contractors and the Associated General Contractors Boards of Directors. She also served on the Board of Directors for the University of New Mexico Construction Program Advisory Council, which she helped to found. Rivera has been an active community leader, currently serving on the board for the YWCA, and has worked extensively with ARCA, the Association for Retarded Citizens of Albuquerque.

Rivera has also spoken at and conducted seminars throughout the country with regard to Communication in the Construction Industry and Women in Construction.

Currently, she serves as CEO of Syntactics Communication Skills, LLC, a company that offers presentation and speaking skills training and coaching to executives at every level. In addition, she provides corporate consulting through KEYGroup®, an international consulting, training, and assessment firm based in Pittsburgh, PA.

Land trusts

February 4th, 2008

Dear EarthTalk: What’s a “land trust” and how does it help the environment?

– Sam Stout, Darien, CT

A land trust is an organization that works with landowners to conserve their land, either by buying it from them or obtaining it as a donation. Legal agreements between the trust, the landowner and the local government are then created in order to permanently limit development of the land. Land trusts are usually nonprofit, and their purpose is to provide long-term stewardship of not just land, but sometimes areas of historical or archeological significance.

The need for land trusts arose out of public concern for the loss of open space, wildlife habitat and scenic beauty in the face of rampant development on private land during the latter half of the 20th century. More than 1,600 land trusts have since sprung up in a variety of communities across the U.S. Together they have protected some 37 million acres of land, according to the Land Trust Alliance, a Washington, DC-based umbrella group formed in 1981 to help land trusts share information and work more effectively.

When a land trust acquires land, it may retain ownership in perpetuity in order to protect the parcel from development. When landowners donate parcels to a land trust outright, they can take advantage of state and federal income tax deductions—similar to any tax-deductible, non-profit donation—while saving considerable money on property and estate taxes moving forward.

Whether a land trust buys a parcel or gets it donated, it can either hold onto the property or, depending on the arrangement with the former owner, sell it to a third party—often a local or state government that commits to turning it into a protected area. Land trusts also sell land to private buyers, usually with strict restrictions on future development. The benefit to keeping the land under private ownership is that it can then stay on local property tax rolls and thus continue to provide revenue for the local government.

Another way land trusts work is through “conservation easements,” whereby individuals can protect their land but still retain ownership and the option of selling or passing it along to heirs. Future owners of the land are also bound by the easement’s terms, which restrict development and use and are often monitored by a land trust. Conservation easements usually lower the financial value of their land (by limiting development potential), but landowners benefit because their property taxes go down accordingly. Likewise, if and when heirs inherit the land, the conservation easement lessens their estate tax burden.

Every conservation easement is different, but most include provisions limiting or forbidding construction or resource extraction. Often they protect especially sensitive lands such as wetlands. Some easements allow specific parcels to be used for agriculture, ranching or logging. Many allow hiking, camping, bird watching or even hunting (though some specifically ban hunting and are created for that purpose).

Another nonprofit group, the American Land Conservancy (ALC), functions like a national land trust working nationwide to ensure that large or exceptional pieces of property stay out of the hands of developers. Some of ALC’s work has led to the creation or expansion of national parks in Colorado, Hawaii and elsewhere.

CONTACTS: Land Trust Alliance, www.lta.org; American Land Conservancy, www.alcnet.org.

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Earth-friendly chocolate

February 4th, 2008

Dear EarthTalk: I heard a reference to “Earth-friendly chocolate” and was wondering about what goes into chocolate that would raise environmental concerns. – Ben Moran, Providence, RI

Like coffee beans, the cacao seeds from which we derive chocolate can only be grown successfully in equatorial regions—right where the world’s few remaining tropical rainforests thrive. As worldwide demand for chocolate grows, so does the temptation among growers to clear more and more rainforest to accommodate high-yield monocultural (single-crop) cacao tree plantations. What are left are open, sunny fields with dramatically lower levels of plant and animal diversity. Adding environmental insult to injury, most cacao plantations use copious amounts of chemical fertilizers, pesticides and fungicides that further degrade the land that once teemed with a wide variety of rare birds, mammals and plants.

Another problem with chocolate production, although not specifically an environmental concern, is the conditions endured by workers that pick and process the cacao seeds. The International Institute of Tropical Agriculture has documented some 284,000 children between the ages of nine and 12 working in hazardous conditions on West African cacao farms. In Africa’s Ivory Coast, for example, where more than 40 percent of the world’s cacao is grown, underage cacao workers are routinely overworked, performing often-dangerous farming tasks in a setting that some liken to slavery. As a result of these and other related injustices, so-called “fair trade” advocates have targeted large producers of cacao to improve working conditions and pay living wages that allow workers to get their kids out of the fields and into school.

Some cacao farmers have enlisted the help of scientists and environmental groups to find ways to produce chocolate more fairly and more sustainably. The nonprofit Rainforest Alliance, which works on similar issues with coffee growers, is now partnering with cacao growers in Ecuador to develop environmentally and socially responsible cacao production and processing standards. The standards seek to maintain critical conservation areas, reduce pressures to convert more forestland to cacao plantations, and provide social and economic benefits to local communities. As a result, some 2,000 cacao growers in five Ecuadorian communities have now formed cooperatives that help find new markets for their products while overseeing adherence to fair labor standards and environmental protection measures. Rainforest Alliance hopes to expand the program to other cacao growing regions of the world in the coming years.

Those looking to get their hands on some organically grown fair trade chocolate have more options than ever before. Leading brands include Dagoba, Endangered Species Chocolate, Equal Exchange, Green & Black’s, Sjaak’s, Sunspire, Terra Nostra Divine, Theo, Sweet Earth, and Yachana Gourmet. Actor Paul Newman has gotten in on the act, too, with his Newman’s Own brand. Like Newman’s Own, many of the companies donate money to environmental and other nonprofit efforts. Whole Foods and other natural foods retailers stock many of these brands, which are also available via various Internet-based retailers including Global Exchange’s Fair Trade Online Store.

CONTACTS: International Institute of Tropical Agriculture, www.iita.org; Global Exchange’s Fair Trade Online Store, www.gxonlinestore.org.

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Online green information

January 28th, 2008

Dear EarthTalk: What are some of the best online sources of environmental information? — Hip2bGreen, Seattle, WA

One of the best places to start in venturing out into eco-cyberspace is the website of a green group you already know—perhaps one for whom you have donated money or volunteered. Most groups use their websites to keep their supporters updated on the issues they cover, and provide links to many other green websites. Beyond such groups, several independent “third-party” sources also provide useful information on a wide range of environmental topics, from consumer tips to news to action alerts.

One leading green website is Grist (grist.org), which reports environmental news in a witty and engaging manner, billing itself as “gloom and doom with a sense of humor.” Checking out Grist’s daily rundown of environmental news is de rigueur among eco-activists, and many regular folks keep tabs on it, too. Other excellent news sources include Environmental News Network (enn.com), and Environmental News Service (ens-newswire.com). And one new kid on the block is The Daily Green (thedailygreen.com), which bills itself as the “consumer’s guide to the green revolution.” Owned by major magazine publisher Hearst, The Daily Green offers news, green tips and advice, and a plethora of green home, food and lifestyle topics.

The Green Guide (thegreenguide.com), run by National Geographic, is probably the best online source for green consumer information, specializing in green living tips, product reviews and environmental health news. Looking for guidance on saving water around the house, choosing among non-toxic paints or packing greener lunches for your school-age kids? The Green Guide would be a good place to start.

If you’re interested in more comprehensive looks at green issues and topics, emagazine.com posts much of the content of its flagship E – The Environmental Magazine, along with weekly news and commentary. Visitors can also access 18 years worth of in-depth articles—the magazine has been turning out bi-monthly print issues since 1990—on just about every green topic imaginable.

Those interested in social networking and the environment should look to Care2 (care2.com), the world’s largest online environmental community. The site offers its eight million members free e-mail accounts and provides lots of background information on just about every environmental issue.

A handful of green ‘blogs are starting to get a lot of media attention and web traffic. The king of them all is Treehugger (treehugger.com), which offers several posts each day from a stable of thinkers committed to environmental issues. Its coverage is not comprehensive, but Treehugger excels at tapping into trends in environmental thinking and culture. Another source of environmental tips and culture online is IdealBite (idealbite.com), a blog-style site offering up “bite-sized ideas for light green living.”

And then there are the “click-to-donate” websites, where visitors can read up on a variety of conservation campaigns and then contribute money via credit card. Ecology Fund (ecologyfund.com), the Rainforest Site (the rainforestsite.com) and Red Jellyfish (redjellyfish.com) are some of the leaders in this category.

So cue up that browser and start clicking. You’ll be amazed at what you can learn, let alone accomplish!

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Saving sharks

January 28th, 2008

Dear EarthTalk: What is the status of sharks around the world? I see occasional stories about sharks attacking humans, but on balance aren’t we a lot more brutal to them then they are to us? Pam Hitschler, Radnor, PA

It’s true that humans do a lot more damage to shark populations than vice versa. Marine biologists report that sharks are in rapid decline around the world. In the North Atlantic Ocean, shark populations have declined more than 50 percent over the past 20 years alone, with some species now nearing extinction.

Experts see the primary cause as overfishing, which depletes sharks as well as their prey. Sharks are especially vulnerable to illegal “longlines” (fishing nets strung across dozens if not hundreds of miles of ocean), where they get inadvertently snared along with the tuna and swordfish fishermen intend to catch.

Rising demand for shark fin soup in is also contributing to the demise of sharks. According to a report by Wildaid, shark fins are among the most expensive seafood products in the world, selling for some $700 per kilogram on the Hong Kong market. With prices like that, many longline fishermen, who are already operating illegally, are happy to augment their incomes by “finning” a few sharks along the way. (Finning is the practice of removing a fin from a shark and discarding the rest of the carcass at sea.)

Often, threatened wildlife species manage to maintain their numbers in spite of excessive human predation. But sharks face an especially uphill battle, says renowned shark expert Ransom Myers, because they “take a long time to mature and have relatively few babies.”

So what is being done to save sharks? In the U.S., the Magnuson-Stevens Fishery Conservation Act is the primary law that oversees the conservation of U.S. fisheries and has established various management regulations for 39 species of sharks in the Atlantic Ocean, Caribbean Sea and Gulf of Mexico. It outlaws finning if the carcass is discarded but not if the rest of carcass is kept, clearly an unfortunate loophole.

The U.S. also helped develop a United Nations Food and Agriculture Organization treaty (the International Plan of Action for the Conservation and Management of Sharks) whereby 87 countries agreed to develop their own plans for the conservation of sharks. However, only two countries—the U.S. and Australia—have lived up to the agreement. The U.S. plan is administered by the National Oceanic and Atmospheric Administration, which has been working with regional fisheries authorities to make sure fishermen are sticking to cautiously low quotas regarding the number of sharks they are allowed to catch.

What can consumers do to save the sharks? The Monterey Bay Aquarium in Monterey, California urges consumers to avoid all shark products, not just on restaurant menus but also all souvenirs such as jaws and teeth, and shark-cartilage pills, which have been touted as cancer cures but which have been proven to be completely ineffective and are now widely considered a scam. The aquarium also encourages consumers to support with their pocketbooks conservation groups working to protect sharks and oceans, and specifically those working to set aside marine reserves that are off-limits to fishing.

CONTACTS: Wildaid, www.wildaid.org; Monterey Bay Aquarium, www.montereybayaquarium.org/cr/seafoodwatch.asp.

GOT AN ENVIRONMENTAL QUESTION? Send it to: EarthTalk, c/o E/The Environmental Magazine, P.O. Box 5098, Westport, CT 06881; submit it at: www.emagazine.com/earthtalk/thisweek/, or e-mail: earthtalk@emagazine.com. Read past columns at: www.emagazine.com/earthtalk/archives.php.

Disrepair, Danger & Dollars Ill-Spent: A Look at the Shocking State of the Nation’s Infrastructure…and How It Got That Way

January 23rd, 2008

Disrepair, Danger & Dollars Ill-Spent: A Look at the Shocking State of the Nation’s Infrastructure…and How It Got That Way

With the release of the NTSB’s report on the I-35 bridge collapse in Minneapolis come new revelations about how out of control infrastructure problems have gotten in the US. Construction attorney Barry B. LePatner provides a reality check for us all.

Chicago, IL (January 23, 2008)—The verdict is in on the Minneapolis bridge collapse, and the results are far from comforting. We knew the August 2007 disaster was a “wake-up call” to the poor condition of our nation’s infrastructure, but we may not have realized what a public safety and economic nightmare we were actually waking up to. Barry B. LePatner says the new report confirms two facts: 1) our government has dropped the ball in a shocking way, and 2) if we don’t take aggressive action now, it’s only a matter of time before the next, inevitable tragedy. Indeed, the real surprise is that more bridges haven’t fallen.           

If you haven’t heard, the report, recently released by the National Transportation Safety Board, indicates that inspectors believe the bridge collapse, which resulted in 13 dead and 145 people injured, was caused due to a flaw in the original design of the bridge. But that’s not the shocking part. Hard as it may be to believe, the government doesn’t mandate that inspectors periodically revisit original design documents to make sure bridges will hold up under today’s conditions—even though many of these structures are half a century old or even older.    

 “The design flaw revelations are only the tip of a very damning iceberg,” says LePatner, coauthor of Structural & Foundation Failures (McGraw-Hill, 1982, coauthored with Sidney M. Johnson, P.E.) and author of Broken Buildings, Busted Budgets: How to Fix America’s Trillion-Dollar Construction Industry (The University of Chicago Press, October 2007, ISBN-13: 978-0-226-47267-6, ISBN-10: 0-226-47267-1, $25.00).

“In 40 years, new calculations were never made to determine how much weight the bridge should be holding in today’s conditions. Was there more traffic flowing over this bridge? Yes. Had renovations been made to the bridge that added weight to the structure? Yes, and, in fact, there was heavy construction equipment parked on the bridge when it collapsed. But no one ever said, ‘Wait a minute—let’s make sure this bridge can handle all of these changes that have occurred.’ To me, that’s terrifying!”

And here’s some more sobering food for thought: there are currently 72,000 bridges that the federal government labels “structurally deficient” and 80,000 labeled “functionally obsolete.” The fallen I-35 bridge wasn’t on either list.

The state of the infrastructure system in the U.S. today results from having been poorly managed and underfunded for years, says LePatner. Today, there are no uniform state-mandated minimum standards for the maintenance of bridges and roads. Inspections of bridges are to occur every two years by federal requirements, but when carried out these are often subjective visual observations that fail to use the latest technology to detect cracks and corrosion that may be invisible.

Currently, he adds, the U.S. government provides $2 billion in maintenance costs annually for 592,000 bridges that fall within its purview. This works out to a paltry $3,500 per bridge.            

 ”It doesn’t take a genius to realize that $3,500 isn’t enough to cover an adequate bridge inspection,” says LePatner. “And if you and I can realize that, you’d better believe the politicians who allocate the money know it, too. But politicians don’t get votes for refurbishing infrastructure. It’s a topic that’s just not sexy enough for them, so they’re not interested in backing it. They just bury their heads in the sand and hope that nothing bad happens on their watch!”

Another factor hindering the funding of repairs is the system in play that allows state governments to do what they choose with the money given to them by the federal government.

“The federal government doesn’t give a state X amount of money and say bridge A in your state needs repairs and you must use this money to fix it,” says LePatner. “So the state uses its own discretion to decide how to use the money, and that may result in, I don’t know, park renovations instead of bridge repairs.”  

Today’s problems remain, despite decades of engineering analysis and reports that have highlighted the deteriorating nature of our infrastructure and the costs of remediation—now estimated to be in the hundreds of billions and increasing exponentially as every year passes. Over the years, the problem hasn’t magically gone away (as politicians would doubtless like it to) but has snowballed and snowballed.

“There are over 12,000 bridges being used today, whose designs are similar to that of the I-35 bridge,” says LePatner. “And there are over 100,000 more that need detailed inspections to ensure their safety. The hard reality is that, as it stands now, there are no cheap or easy fixes for the infrastructure problem in the U.S., but every day they go unchecked our safety is at risk.”

What this really boils down to is that the bridge you cross on your way to work, the bridge your child’s school bus travels over, or the bridge that leads to your favorite vacation spot could fall. When you look at it that way, says LePatner, you realize that the years of neglect our politicians have allowed—and even encouraged—is akin to a criminal offense.             

“The longer we wait to solve these problems the bigger they become,” says LePatner. “Not only is the public’s safety at risk on a day-to-day basis, but these broken bridges and the larger infrastructure problems they signal will also hurt America’s ability to compete in a global economy. What’s more, our crumbling infrastructure is also a national security threat that invites terrorists and those bent on disabling our nation’s economy to do their jobs in a much easier, more inviting way.”            

Of course, there are no simple solutions. Now that we have a huge budget deficit and a recession waiting in the wings, LePatner worries that there is simply no money available to make significant repairs to the nation’s infrastructure. He theorizes that we may have to start with reform of the system—encompassing both the governmental and construction industry arenas—and that will come about only if citizens demand it.

“There absolutely has to be a national dialogue about what we are going to do about this huge and growing problem,” says LePatner. “And in order to create a dialogue, the people of this country have to demand that politicians take notice. At the moment, no one is talking about it. The presidential candidates are focusing all of their attention on the war, healthcare, and immigration. They don’t seem to want to discuss what to do about the infrastructure problem. We will have to make them take notice.             

“Our politicians have forced us into the driver’s seat,” adds LePatner. “We, the citizens, must insist that our infrastructure problems are made a national priority. End of story. It’s crazy that things have been allowed to get to this point. It’s time we start holding our politicians accountable for their management, or mismanagement, of our money—and there is no better time to do that than election season! We need to start repairing our infrastructure, we need to do it in a financially responsible way, and we need to do it now. Let’s not wait until the next tragedy to get serious about it.”

# # #

About the Author:

Barry B. LePatner, Esq., is the founder of the New York City-based law firm LePatner & Associates LLP. For three decades, he has been prominent as an advisor on business and legal issues affecting the real estate, design, and construction industries. He is head of the law firm that has grown to become widely recognized as one of the nation’s leading advisors to corporate and institutional clients, real estate owners, and design professionals.

A nationally recognized speaker, Mr. LePatner has addressed audiences on topics central to trends affecting the real estate industry at recent events including: “Real Estate Outlook,” an annual seminar series for corporate and real estate executives; “Protecting the Owner from Pitfalls in Today’s Construction Projects,” a series of Continuing Legal Education lectures given to law firms and their in-house real estate departments; “Protection, Survival, Readiness: Project Strategy in the Post 9/11 World,” a seminar presented to institutional, developer and corporate real estate executives; “Secure Space,” a building security seminar for corporate owners and developers; and “Marketing for Design Professionals” at the Harvard Graduate School of Design’s Summer Program, with A. Eugene Kohn from1990-2004.

He has written extensively and is widely quoted in the media on the subject of construction law. Mr. LePatner has previously coauthored the legal sections of the Interior Design Handbook, McGraw-Hill, 2001, and Structural & Foundation Failures: A Casebook for Architects, Engineers & Lawyers, McGraw-Hill, 1982, coauthored with Sidney M. Johnson, P.E.

Recently published articles include “Construction Cost Increases: Owners Should Know the Difference Between the Myths and Realities,” New York Real Estate Journal, October 2006; and “Are You Prepared—Disaster Management Plans Help Owners Protect Their Investments” in the March/April 2006 issue of Commercial Investment Real Estate magazine. Articles published in the New York Law Journal include: “Caveat Advocatus—Drafting Construction Agreements for Your Client’s New Construction Project Ain’t What It Used to Be,” March 27, 2006. Since 1980, he has edited and published the LePatner Report, a quarterly newsletter on business and legal issues for the firm’s design, real estate, and construction clients.

About the Book:

Broken Buildings, Busted Budgets: How to Fix America’s Trillion-Dollar Construction Industry (The University of Chicago Press, October 2007, ISBN-13: 978-0-226-47267-6, ISBN-10: 0-226-47267-1, $25.00) is available at bookstores nationwide, from major online booksellers, and direct from the publisher at press.uchicago.edu.

For more information, please visit brokenbuildings.com.

Bridging the Gaps: Six Solutions for Repairing the Nation’s Crumbling Infrastructure

The National Transportation Safety Board’s recent report on the Minneapolis I-35 bridge collapse provided a glimpse into just how dire the situation is with our nation’s infrastructure. The report only added to concerns that inspections are infrequent and insufficient, transportation funding is inadequate and improperly used, and the nation lacks the proper number of experts to fully examine the situation.

Construction attorney Barry B. LePatner says now is the time to redeem our former neglect. That means transforming the way we think about not only our nation’s infrastructure, but the nature of the construction industry itself. He offers the following six solutions:

· Establish a standardized nationwide system for categorizing the remediation needs of
America’s infrastructure.
Many problems with our nation’s infrastructure have resulted from the relaxing of inspection standards in recent years, says LePatner. As a result, different engineers can categorize structural problems differently, often for political reasons. For example, in a situation where a decision maker knows money for remediation is not available, lax standards make it possible for him to “dumb down” a report so that action will be deferred. The upshot is that the engineer reporting on bridge A might write it up as being in dire need of repairs because of early signs of corrosion. Meanwhile, bridge B—which is in far worse shape—might be put into a less urgent category.  “We need a strict nationwide standard for categorizing these remediation needs—at both state and federal levels—and for training inspection engineers,” notes LePatner. “That way we can assure uniformity of infrastructure assessments, and serious problems in bridges, tunnels, and highways will be more likely to be reported and dealt with.”

· Institute a national impetus for increasing the number of engineers and construction experts. Right now we’re woefully undermanned, says LePatner. America simply doesn’t have the structural engineers it needs to perform the overwhelming amount of remediation that must be done.“I would like to see a national effort aimed at increasing the numbers of civil engineers and construction experts needed to address America’s infrastructure problem,” he says. “Think of it as a 21st century version of the 1950’s push for science education in the aftermath of Sputnik. We need to tell our young people that construction is an exciting and noble career, and strengthen those areas of our school system accordingly.”

· Ensure that tax dollars directed toward construction projects are spent wisely. This is frequently not the case, says LePatner. He reports that a meta-survey of the construction industry’s productivity analyses recently concluded that up to 50 percent of all money spent on construction labor is wasted because of late deliveries, poorly coordinated subcontractors, and other circumstances preventing employees from engaging in productive onsite work. These inefficiencies are due in large part to the inherent flaws in our nation’s $1.23 trillion construction industry, which LePatner calls “the last mom & pop industry in America.”  

The solution, he says, involves reforming the way public officials work with contractors. For instance, they must:

üInsist on true fixed-price contracts. Standard contracts devised by members of the industry are generally insufficient as they a) fail to properly allocate risk among the parties, and b) provide proven loopholes for contractors to make claims for additional costs.

üRetain skilled, experienced onsite construction representatives with in-depth knowledge who can oversee not only quality, but the true cost for the work.

üEnsure that there are milestone dates for substantial completion and partial completion of remediation. Use both incentives and penalties to ensure timeliness.

üPurchase materials in bulk to leverage economies of scale.“By implementing these suggestions even partially, our nation can save billions of dollars,” he insists.

· Overhaul the nation’s infrastructure inspection system. As it stands, bridge inspections are required only every couple of years, and because inspectors look only for visible cracks and corrosions, those inspections are superficial at best. Frighteningly, many bridges are still operating under their original load calculations. For example, when the I-35 bridge was constructed 40 years ago, calculations were made to determine the maximum load the bridge could hold, which includes considerations for the amount of traffic that would be using the bridge and also whether the bridge could accommodate heavy vehicles. But despite the fact that traffic volume increased over the years and renovations were made that added to the weight of the bridge, no new calculations were made to determine the load the bridge could safely hold under today’s conditions. “What’s even more mind-boggling than the findings of the report is the fact that even after what they’ve found, the NTSB is still only recommending, not requiring, that bridge owners recalculate bridge loads periodically,” says LePatner. “The whole inspection system needs to be overhauled. And I think it should start with the NTSB making more stringent requirements for these bridge inspections and the federal and state governments doling out stiffer fines when bridges aren’t properly maintained. The problem won’t stop growing until we can get a hold on the inspection process.”

· Invest in the latest technology. The methods used to detect the cracks and corrosion in today’s bridges are insufficient. Most inspection methods cannot detect microscopic problems. But according to the Center for American Progress, wireless sensor technology exists that allows all aspects of a bridge to be examined from strain to temperature to seismic activity. Perhaps the best thing about the new sensors is that they can be attached or embedded on bridges so that a bridge’s condition can be monitored as frequently as necessary. “What this new technology can do is amazing,” says LePatner. “It will provide more frequent, more reliable information on our nation’s bridges, greatly reducing the likelihood of human error and conflicting reports on a bridge’s condition. Every state should use this technology to assess which bridges need immediate repairs.”

· Review the transportation funding process. With hundreds of billions of dollars needed to repair all of the problems in our nation’s infrastructure, every penny of funding that is doled out for transportation should be used wisely and appropriately. Unfortunately, that just doesn’t happen. Money has been stripped away from the transportation agencies, which need all of the funding they can get in order to get a handle on the country’s infrastructure problem. Add to that the fact that money given to the state governments by the federal government for transportation is often used for projects that may be more noticeable to taxpayers but does nothing for public safety. For example, a state government can use part of its transportation budget to beautify a park rather than buy new infrastructure inspection equipment or fund the repairs of a failing bridge. “Money has to be earmarked specifically for infrastructure repairs on a state and local level,” says LePatner. “Politicians have to realize that these failing bridges are threatening citizens’ day-to-day safety, national security, and an already struggling economy. The costs will come due eventually whether they happen now or after the next major collapse. It’s time to be proactive.”

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Yacht Shopping

January 16th, 2008

picture-3.pngIts that time of year again. A chance to shop for that new yacht, radar or dinghy all in one location. The Seattle indoors and afloat boat show is the now the largest boat show on the West Coast. This is your opportunity to compare different products at the same location. Want a new yacht? Walk down the dock and do a direct comparison of your two favorites. New Radar? Just walk down the aisle and compare all the new models. Shopping has never been easier.

I’ve been attending and/or working at boat shows since 1971. There’s something new and exciting every year.

It’s always worth going!

Hours at the in-water floating show at South Lake Union are 11-5 weekdays and 10-5 weekends. Hours at the QWest field event center are 10-8 weekdays, 10-8 Saturdays and 10-6 Sunday. The show runs from Thursday Jan. 24 through Sat. Feb. 2.

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