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Coffee Talk
+ Sarasota County freezes impact fees
Lower revenues have some local governments rethinking some of their high fees. In a meeting this week, Sarasota County Commissioners took the first steps toward reducing one road impact fee and delaying an increase all others.
The county raised road impact fees significantly in June and had scheduled another increase for June 2008, but faced with the tumult in the real estate market, the commission voted to push back those June 2008 increases by a year.
In addition, the commission voted to change the methodology used to calculate the road impact fee for hotel and motel projects, which would knock off $920 a room from the June increase. Hotel and motel impact fees, which went from $1,169 a room to $2,972 a room in June, would be reduced to $2,052 a room.
As of press time, both decision were expected to require an additional public hearing, although prior to that meeting county staff will likely charge the lower proposed hotel and motel impact fee rate based on an administrative adjustment.
"This was a recognition by the commissioners that having high fees has a negative impact on the economy and their own revenues," says Jay Brady, executive director of the Gulf Coast Builders Exchange, a Sarasota-Manatee county construction association. "Essentially, that there are other revenues they're losing because development is being held back."
Commissioner Jon Thaxton reported the commission was struggling to create an impact fee schedule that was flexible enough to meet their affordable housing and economic development goals that would also meet the current legal requirements, which doesn't offer the commission the flexibility to designate relief for one type of construction over another.
"We heard from (economist) Hank Fishkind that our commercial fees were too high and were going to stymie economic development, but that our fees for residential development didn't matter," Thaxton says. That is, Fishkind found that up to the fees the county was charging was not reducing residential construction.
+ CEO buys $1 million
worth of Chico's stock
It's always a good sign to see a CEO buy $1 million worth of the stock of the company he runs, especially when that company is Chico's FAS.
The women's apparel retailer has suffered sales declines at stores open more than a year and investors have punished the stock, driving it down 50% for the year-to-date through mid-December (stock symbol CHS, recent price $10).
But Scott Edmonds, Chico's CEO, president and chairman recently bought 100,000 shares in four separate purchases averaging $10.22 per share, according to filings with the Securities and Exchange Commission. This move gives investors hope that at least Edmonds is on their side when he talks about increasing shareholder value.
The stock didn't jump up on the news of Edmonds' purchases, but maybe there's hope for shareholders who have hung on until now.
+ Vulture funds
circling residential
Don't look now, but the downturn in the residential real estate market has vulture investors circling Tampa Bay, trying to buy lots on the cheap.
They are local and out-of-state investors of all sizes.
"They are expecting a big return in three to five years," says Tampa real estate attorney Ron Weaver. "It is moderately patient money."
And the profile of landowners? Like a Target shopper, Weaver says. "The profile is just about everybody," he says. "After three years of growth, all kinds of folks got into that."
Weaver expects only 5% of the land to switch to commercial. Most will remain ready for homebuilding in two to five years. Yet the next housing boom in Florida will be more subdued, he says. Lenders will be slower to lend.
+ Environmental activist may run for county seat
Jono Miller, a well-known Gulf Coast environmental activist, tells Coffee Talk he is giving "serious consideration" to running for the Sarasota County Commission in 2008.
Miller, who runs the environmental studies program at Sarasota-based New College, hasn't formally filed paperwork with Sarasota County election officials yet but says he's past the stage of simply taking about it with friends, colleagues and potential supporters. Says Miller: "I'm definitely thinking about it. I'm giving it serious consideration."
He adds that he's been speaking with people who would help launch and then run a campaign, and, if he does run for office, he says he would have an announcement by February.
Miller says he would run as a Democrat for District 1, which covers the northern section of Sarasota County. That seat is currently held by Paul Mercier, a Republican who was elected to his first term in 2000. Mercier has said he will seek re-election for a third term.
Miller has been recognized locally and statewide for environmental conservation efforts. He's served as chair of both the Manatee-Sarasota Sierra Club and Sarasota County's Environmentally Sensitive Land Program and he was a contributing author to The Book of the Everglades, a statewide publication.
Miller, though, says he thinks environmental-based ideals and issues in Sarasota County have been faring well lately, at least better than the economy has been doing. And the economy would be the focus of a campaign, he says, although he declined to elaborate on specifics or platforms.
"I think the economy is going to be a challenge for Sarasota for a few years and the county will need a good team to address these issues," says Miller. "I'd like to be a part of that team."
+ Ideal Image
finishing strong
Tampa-based Ideal Image, the laser hair removal chain, is finishing 2007 strong, boosting same-store sales revenues 28% over 2006.
The company has 20 new locations lined up for future openings and opened 60 new locations this year, CEO Dean Akers told Coffee Talk this week. The new locations are outside Florida in states such as Colorado, New York and Texas.
In 2006, Ideal raised $16 million with private equity firm HIG in Maine to help fund expansion. It now considers itself the leading laser hair-removal company in the industry.
Akers actually slowed new construction in 2006 to focus on sales training. Then, he stepped up new construction this year as customer interest picked up.
"The industry is still strong," Akers says.
Its average customer is a 32-year-old woman. Men make up 20% of customers. Those numbers have remained steady. However, one sales number has changed. Two years ago, 16 out of 100 people who made inquiries became customers. Now, the figure is 25 out of 100.
The reasons include the sales training and the quality of the staff, Akers says.
"Like anything in business, it's all in how you treat the customer," he says. "It's like the line from the movie 'Jerry Maguire.' 'You had me at hello.' Good staff on the telephones recognize customers with a need. They connect in a friendly, inviting, informative way. The customer then has to feel the love."
+ WCI gets reprieve
from lenders
WCI Communities got a one-month extension from lenders to Jan. 7 to renegotiate the terms of its loans.
So what?
It's hard to imagine lenders foreclosing on WCI and forcing the Bonita Springs-based homebuilder into bankruptcy. Lenders don't want to be saddled with residential land and condos whose value is now questionable. As of Sept. 30, WCI had $1.9 billion in debt.
Plus, any bankruptcy filing would wipe out equity holders. That's not likely to happen as long as Carl Icahn has anything to say about it. Icahn is chairman of the company and owns nearly 15% of WCI's stock.
Still, the company's bonds reflect deep skepticism by investors. They're trading at less than 60 cents on the dollar.
Hanging in the balance is One Bal Harbour, a giant condo tower that WCI is finishing up in condo-busted Miami Dade County. By Jan. 7, everyone should have a good idea how many buyers will pay for their units and how many will default.
+ Lawsuit abuse
issue lingers
Lobbying groups fighting for Florida tort reform have even more evidence that frivolous lawsuits, even the threat of one, is bad for both businesses and consumers.
The latest proof is in the results of a statewide survey of small business owners, the majority of which say lawsuit abuse is bad for their business and forces them to raise prices. Florida Stop Lawsuit Abuse commissioned the survey.
"For years, we've believed that lawsuit abuse is a serious problem for small businesses in Florida," FSLA's Executive Director Carlos Muhletaler says in a statement. "We now have cold, hard numbers that show that junk lawsuits and aggressive tactics by personal injury lawyers are indeed harming many small businesses and forcing them to pass on the costs of fighting lawsuit abuse to their customers."
According to the survey, more than 85% of small business owners believe lawsuit abuse is a significant problem, while 65% believe lawsuit abuse is limiting economic growth and hurting Florida's economy. What's more, even if they have not personally been sued, more than a third of small business owners that responded to the survey say just the threat of lawsuits and liability costs increases the cost of doing business.
ECONOMIC SNAPSHOT
Passenger-car registrations
County 7/05 thru 6/06 7/06 thru 6/07 %Change
Charlotte 110,263 111,691 1%
Collier 208,624 207,403 ‑1%
Hillsborough 713,231 727,626 2%
Lee 361,073 364,176 1%
Manatee 178,572 179,081 0.2%
Pinellas 598,588 587,003 ‑2%
Sarasota 263,606 260,263 ‑1%
Source: Florida Department of Highway Safety & Motor Vehicles
What the data shows: The Florida Department of Highway Safety & Motor Vehicles reports the number registration transactions for each Florida county in its fiscal year ending in June. Passenger-car registrations showed modest declines in three Gulf Coast counties: Collier, Pinellas and Sarasota. Meanwhile, Hillsborough led gains in Charlotte, Lee and Manatee counties.
What it means: Some counties, such as Pinellas County, are built out and there isn't much population growth to fuel car registrations. Meanwhile, the high cost of living may be driving some of the growth away from Collier and Sarasota and into neighboring counties such as Lee, Charlotte and Manatee counties. By contrast, Hillsborough's continued growth in population is likely spurring car registrations.
Forecast: Although still growing, the state's population growth is likely to moderate in the years ahead. Car registrations will reflect that trend.
When work works,
it works really well
Nine Gulf Coast businesses were recognized by a nationwide initiative to find the companies that best use flexible and employee-friendly policies as a strategy to grow a business. The program, called When Work Works, awarded eight Tampa area companies and one in Sarasota with its Alfred P. Sloan Award for Business Excellence in Workplace Flexibility.
The Tampa area was one of 24 metro areas chosen for the 2007 awards, and one of only two in Florida. The award process is a whittling down system that compares how a nominated company holds up to national research on a list of workplace issues, including topics such as flextime, benefits and a compressed workweek.
Executives for one of the Gulf Coast winners, Sarasota-based public accounting firm Kerkering Barberio, say the recognition, while gratifying, is essentially an acknowledgment of things the firm has been doing for years. Managing Partner Rob Lane says the founders created a "work hard, play hard" environment that has lasted more than three decades.
"We didn't do it as a formal approach," Lane says of the company's programs, which include flexible scheduling, telecommuting and health benefits and vacation pay for part-time employees. "It's something we've been doing for a long time."
The eight Tampa-area workplaces to win are: Argosy University, Tampa; CIBERsites; Citigroup; Greenacre Properties, Inc.; Residential Drywall, Inc.; Self Reliance, Inc., Success 4 Kids & Families; and TEKsystems.
When Work Works is administered by the Families and Work Institute, a New York-based workplace research center. It's sponsored by the Alfred P. Sloan Foundation, a nonprofit philanthropic institution whose namesake was once the president and chief executive of General Motors, in partnership with the Institute for a Competitive Workforce, an affiliate of the U.S. Chamber of Commerce and the Twiga Foundation, a workplace issues center.
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