By David J. Jordan
Partner, Stoel Rives
It is a foolish farmer who eats his seed corn in tough times. Nothing will be left to plant for a future harvest. Utah students are the seed corn of our economy. If we do not do our very best to teach and train them now, they will not be equipped to create and fill the careers of tomorrow; and we will all be the poorer for it.
In his State of the State address, Governor Gary Herbert called on the Legislature to hold education harmless from further budget cuts. That challenge presents the Legislature with some difficult and critical choices.
Without increasing user fees on tobacco or motor fuel, and barring significantly improved revenue projections, something has to be cut. Should legislators make across-the-board cuts to the entire state budget or should they fund education at the expense of other programs and projects?
The right answer is to follow the governor’s charge to fund education.
The 17 percent cuts that have already been absorbed in the last budget cycle come at a time when enrollments are up both in public and higher education. This is a natural result of both population growth and increased participation. It is a predictable pattern that when the job market tightens, more students seek higher education to make themselves more employable. Consequently, over 12,000 new students enrolled in college this past fall compared to the previous year. In total, enrollments are up by 17 percent over the past two years.
With simultaneous budget cuts and growing enrollments, university and college presidents are facing a perfect storm. While trying to serve more with less, they have already been forced to:
- Eliminate over 900 employee positions, including faculty
- Limit class availability to students because classes are full
- Increase student/advisor ratios
- Reduce salaries and benefits
- Delay infrastructure repairs/upgrades, including building closures
If the additional four percent across-the-board cuts to higher education being debated by the Legislature are enacted, they would have a crippling impact on students and the state including:
- Access to higher education by students statewide will be limited because Institutions at capacity will have no choice but to begin limiting the number of students who can enroll by imposing enrollment caps.
- All institutions will further eliminate numerous class sections, prolonging students’ time in college as they have difficulty obtaining classes they need to graduate.
- Elimination of academic programs ranging from CTE to baccalaureate to graduate degree programs.
- Larger numbers of students for every academic advisor; without good advice students are less likely to make the best choices in course offerings which can also delay their time to graduation.
- Closure of satellite campuses.
- Prolonging time to graduation delays students’ full entry into the workforce as taxpayers and lessens their ability to provide for their families.
- Elimination of approximately 600-700 full-time positions— mostly through involuntary lay-offs.
- Reducing the number of students trained and educated for the workforce by Utah’s public colleges and universities through enrollment caps.
- Undermining the capacity of our research universities, resulting in negative economic impacts for the state as adequate support for research is lost, reducing competitiveness for research grants which provide thousands of high-paying jobs and the ability to develop technologies that spin-off into new businesses.
If you terminate the faculty and discontinue an educational program, you can’t just turn the spigot back on next year. Once an educational program is dismantled, it takes years to rebuild. In the meantime, the opportunity to teach students in that program and train a work force that builds our economy is lost. If you cram more third graders into an already over-crowded math class because you can’t afford to hire another teacher, you can never give those students back their third grade year.
Our students are the seed corn of our economy. In lean times we must be prudent in our expenditures but we must also be smarter than the foolish farmer. Now is the time to sow the seeds of future economic strength.
Lew Cramer, president and CEO of the World Trade Center Utah, discusses the importance of exports to Utah’s economy. Special thanks to UtahPolicy.com.
By Lane Beattie, President and CEO
The Utah Legislature will convene for the 2010 General Legislative Session Monday. They will do so with the well-deserved title of “Best Managed State in the Nation.”
Utah achieved this ranking in 2008 from the Pew Center on the States because of our performance in four key areas – money, people, infrastructure and information. It is a proud honor for our state, and one that Utah has received eight times during the course of the last four governors.
But today Utah, like every other state, faces serious challenges not felt by any previous Legislature or governor.
- State government revenues have declined by nearly a billion dollars in the past three years.
- Nearly 90,000 Utahns are unemployed. That’s a population almost the size of Orem City.
- School enrollment in both public and higher education is at record levels.
- Human service caseloads are up 14% in the past year alone.
- And we have the fastest growing population in the country.
To quote the great patriot, Thomas Paine, “These are times that try men’s souls.” As business leaders we are asking a simple question: When the Pew Center does their next grading of the states, probably in 2011, what will they see?
Will we have managed through this financial crisis in a way that propels the Utah economy to once again lead the nation?
Will we have invested in our most important business resource – our people?
Will we have developed our workforce so that Utah families can be supported by high-paying jobs?
Will we have repaired and maintained our capital assets?
Will we have controlled costs so that future taxpayers are not burdened by our decisions?
Will we pay for our fair share of capital expenditures rather than passing them on to future generations?
Will we take responsibility for our choices and be held accountable for our actions?
May I suggest that the Pew Center, when grading all 50 states next year, will be asking all of these questions and more. They will be applying the business principles that you see attached to the wall behind me to the management of state government and asking, “Did they manage well and did they lead?”
Now is a time to lead.
As business leaders we ask the State Legislature as to apply business principles to the management of government. If they don’t , they will have squandered a great opportunity because no state is better positioned than Utah is right now to lead this country out of recession.
Of course, it’s not about the Pew Center, Governing Magazine, or any expert grading system, however well respected. It’s about providing the citizens and businesses in this state with abundant opportunities to develop and improve life quality.
And if we do, we will continue a long-standing tradition in this state to be not only well-managed, but to be a great place to do business, to live and to raise a family – a value at the heart of who we are.
The Salt Lake Chamber debuted the 2010 Public Policy Guide today, first presenting it to Speaker of the House David Clark and Senate President Michael Waddoups during a CEO Roundtable and later rolling out the business community’s policy priorities for the upcoming legislative session.
New program encourages downtown businesses to recycle glass and save money
Salt Lake City Mayor Ralph Becker announced a new glass recycling program for local businesses today, helping the downtown community kick off a New Year’s resolution to be more environmentally conscious.
The new program will be offered by Momentum Recycling, LLC and is being sponsored by the Downtown Alliance for restaurants, hotels, bars and other businesses in the Central Business District. The Mayor was joined by members of downtown’s business community and by Salt Lake City Council Member Luke Garrott who represents the central city.
The program capitalizes on the close proximity of restaurants, bars and other glass consuming businesses in the Capital City’s downtown. Momentum Recycling will pick up and deliver all glass to The Glass Recycling Group (GRG) which supplies crushed glass to Owens Corning to manufacture fiberglass insulation.
Removing heavy and voluminous materials from the waste stream can dramatically reduce the cost of landfill waste hauls. In addition to collection service, Momentum provides consultation on waste reduction, recycling training for clients, promotion of clients’ commitment to minimizing their organizations’ impact on the environment, quarterly diversion rate estimates and a quarterly newsletter.
Organizers say they would like to have 20 to 30 local businesses participate in the first phase of the program. Squatters, Tin Angel, Takashi, Settebello, Café Molise, Martine, Red Rock Brew Pub, the Alta Club, the Hilton Downtown, Marriott Downtown and Hotel Monaco have all agreed to help launch the program.
“Downtown is committed to finding innovative ways to promote environmental sustainability,” said Jason Mathis. “This new program is the right thing to do for the environment and for the bottom line of local business. We applaud Momentum, local businesses and our city officials for making this new glass recycling project a reality.”
The Downtown Alliance is dedicated to building a dynamic and diverse community that is the regional center for culture, commerce and entertainment. For more information, visit downtownslc.org.
(2009 Small Business of the Year, The Mandarin Restaurant in Bountiful)
The Salt Lake Chamber, Utah’s longest-standing statewide business association, will present the 2010 Small Business Awards at the Chamber’s 107th Annual Meeting February 11th at noon.
“Small business is the lifeblood of Utah’s economy,” said Lane Beattie, President and CEO of the Salt Lake Chamber. “Starting, running and growing a small business are significant challenges and our award winners are all very deserving for their ability to thrive, not only in times of economic challenge, but over the long haul.”
Award recipients were selected as examples of “Utah on the Move” the theme of this year’s Annual Meeting.
Penna Powers Brian Haynes will receive the Small Business of the Year Award, sponsored by Equitable Life & Casualty Insurance Company. Penna Powers Brian Haynes is a full-service advertising, public relations, interactive and public involvement agency providing clients with strategic counsel and relevant creative that delivers results. The agency plays an important role in the Downtown Rising vision, developing and hosting the Downtown Rising Web site. Downtown Rising is a business-led, regional visioning effort created to define a common future for downtown Salt Lake City.
The Entrepreneurial Success Award will be presented to New Media Strategists, a regional communications agency. Michael Dale left a secure job with the family business and provided the capital to start the business despite having no committed clients. Within one month, New Media Strategists had added three well-known Utah companies. Even in a tough year for a small business, New Media Strategists continues to demonstrate the power of the entrepreneurial spirit. The award is sponsored by America First Credit Union.
Every year, nearly a quarter of a million people attend one of the 400 performances at Hale Centre Theatre, this year’s recipient of the Community Service Award. Founded by Nathan and Ruth Hale in 1947, the theater’s newest location in West Valley City is celebrating its 25th year. The theatre not only provides a creative outlet for hundreds of community actors, directors and technicians, it also offers quality outreach and educational programs. The Community Service Award is sponsored by Stoel Rives LLP.
Red Iguana is the recipient of the Minority Small Business Award. The name Red Iguana has become synonymous with fine Mexican cuisine. The founders, Ramon and Maria Cardenas, started in the restaurant business 40 years ago. Red Iguana is among the most popular restaurants in the region and its success has led to the opening of two additional locations. The award is sponsored by UPS.
For just the third time in the history of the Salt Lake Chamber, the organization will present a President’s Award for Excellence. Real Salt Lake not only hosted the Major League All-Star Game at Rio Tinto Stadium last summer, it capped the season by claiming the MLS Cup, brining a world championship to Utah. Real Salt Lake has cemented its position as a significant part of the Utah sports landscape and the business community.
The Chamber will also honor former chair, Chris Redgrave, recently retired after a 20-year career at Bonneville Salt Lake Radio Group. Redgrave completed her one-year term as chair of the Salt Lake Chamber Board of Governors in July 2009. During her term, she championed business solidarity during the economic downturn and streamlined Chamber operations by overhauling the business development model and streamlining the organization’s bylaws.
Six Chamber Champions will also be honored for their dedicated service to the Chamber: Maura Carabello of Exoro Group, Von Coffman of Bonneville Radio Group, Russ Coover of Digital Blue Photo, Jennifer Nii of Intermountain Healthcare, Sheridan Redmond of Customer Dynamics and Paul Springer of Bailey-Montague & Associates. The Chamber Champion awards are sponsored by Mountain America Credit Union.
The Salt Lake Chamber Small Business Awards are sponsored by Questar and Wells Fargo. Event sponsors include Rocky Mountain Power, Modern Display and Webb Audio Visual Communication. Supporting sponsors include The Summit Group and Avalanche Studios.
By Lane Beattie, President and CEO, Salt Lake Chamber
Some interesting messages about education were delivered on Capitol Hill this week. The private sector is expanding its investment. The public sector is trying to decide.
Weber State University supporters gathered in the Capitol rotunda to announce a great new program, Dream Weber, which provides a free college education to thousands of needy students. Dream Weber is possible because of generous donations from private citizens. The private sector knows that investing in education translates to a great workforce, a strong economy and a healthy society.
Meanwhile, the Legislature is measuring whether this very difficult budget year enables them to maintain our state’s investment in public and higher education. Discussions started Tuesday about the possibility of five percent cuts for next year. Utah’s largest statewide business association, the Salt Lake Chamber, has a clear message for elected officials: despite difficult budget times, Utah must protect our investment in public and higher education.
An investment in education is an investment in the future.
Utah has long held bragging rights about our well educated population. Times are changing. Startling statistics show our young people are getting less education than their parents. In 1992, 41 percent of 18-24 year olds had some postsecondary education. Today, only 34 percent of people in the same age group have job training or a college education. Among 45-64 year olds, Utah is 12th in the nation for bachelor’s degrees, but we are 31st among 25-34 year olds.
Being smarter than our children may feel nice around the dinner table once in awhile, but do we really want our kids going out into the world with less smarts than we have? Do we want them to have less earning power than we do?
Businesses go where they find smart people. The smarter the people, the more businesses pay. Do we want businesses going elsewhere to give high paying jobs to someone else’s children and grandchildren in other states? In other countries? We must invest in education now or embrace that kind of a future.
In addressing legislators this week, University of Utah President Michael Young put it another way. “Twenty years from now, do we want to have terrific prisons and terrible universities?” President Young asked. College and university presidents painted a picture of enrollment caps, slashed programs and research, larger classes and other preludes to mediocrity. Salt Lake Community College President Cynthia Bioteau has described it as cutting to the bone. These aren’t exaggerations. Business leaders know that quality suffers when we don’t invest enough to cover the basics.
In public schools, not investing means not laying the foundation for higher education as an option. I talked to a grandmother last week whose grandson attends a kindergarten class in the southwest valley with 53 students. Does anyone think 53 children can learn to read from one teacher? No five year old I know would thrive in such an environment. Some children have the safety net of parents who read to them at home. But more and more of our children don’t have that luxury. Many go home to parents who don’t speak English. Our minority population is expanding dramatically. By 2050, Utah’s population will consist of 30 percent minorities. We must find a way for all our children to achieve success.
We have under-invested in education for many years. The consequences are starting to show. Only 25 percent of Utah students who take the ACT meet the benchmark score that predicts they will earn Cs in college. This means paying for remediation in college, or worse yet, never acquiring the skills they need to achieve success.
We are well aware that the Commissioner of Higher Education and the Superintendent of Public Education have agreed to budget reductions. From the business community, we ask the Legislature to do more. Our future is at stake.
The Salt Lake Chamber has organized a coalition of business leaders to build our workforce and our economy. Our purpose is simple: Improve educational outcomes. For a prosperous 21st century economy, we need more and better-prepared high school graduates, more students getting postsecondary training and college degrees. We must improve outcomes for our skyrocketing minority population. Yes, improvements can be made in the way education is delivered. We must hold our educators accountable to innovate and improve, just as we do in business. And businesses know that providing the resources to make things happen goes hand-in-hand with holding people accountable to generate results.
Like the private sector donors who enabled Weber State University to launch the Dream Weber free tuition program this week, the public sector must invest in education, our future workforce and our future economy. Let’s keep public and higher education whole this budget year, and think long-term about investment and innovation that will improve our educational outcomes. Let’s make sure that Utah businesses hire our children and grandchildren, and that businesses from other states make the Utah choice as well.
The Legislative session is a long and difficult process. Thanks to great leadership, the Utah Legislature has a great track record of managing our state budget prudently and positioning Utah for economic success. Now, more than ever, we need legislators to make the right choices for Utah’s future.
The World Trade Center Utah hosted a seminar to teach Utah internationalists the 9 Essential Steps of Successful Internatinonal Networking, today.
The packed event is evidence of Utah’s booming international presence. Fifty international businesspeople (from 16 different countries) learned how to avoid international blunders and how to succeed in international business.
Adding to the buzz, there are indications Utah’s final trade statistics for 2009 will nearly match the record setting levels set in 2008–higher than projections indicated in November.
By Lane Beattie, President & CEO
Last week the Chamber hosted David Wyss, Standard & Poor’s chief economist, at the Utah Economic Forum. The economy is a hot topic and business leaders, economists, journalists and engaged citizens all took time to listen to one of the world’s most renowned economists.
His message: the recession is over but that doesn’t mean things are back to where they were two years ago.
You may have heard some commentary that while the recession may be over on Wall Street, it surely isn’t over on Main Street. According to Wyss, that’s because the two have different definitions of what “over” means.
Wyss says the recession is over because we’ve hit the bottom. We are turning around and headed in the right direction. This is why Wall Street says the recession is over.
Main Street—meaning businesses of all sizes—disagrees because things aren’t what they were pre-recession. That’s true and may continue to be the case for awhile. Growth will come but, as Wyss puts it, it’s much easier to fall than to climb.
In the past, the Utah Economic Forum attracted some 100 attendees but we had nearly four times that number last week. When talented Utahns take on tough issues, you can bet the outcome will be positive.
I’m confident in the economic future of our state. We have the best managed state in the nation and our governor and State Legislature promote a very business-friendly local economy. Utah still has the nation’s youngest workforce and that has proven very attractive to businesses looking to relocate and/or expand their presence in Utah.
By Lane Beattie, President and CEO, Salt Lake Chamber
Editor’s Note: These remarks were given to the Utah State Board of Education and Utah State Office of Education Board-Legislative Dinner
The great composer Mozart once made a wager with another composer that he could not play at sight a piece which he had composed earlier that day.
When the composer accepted the bet, the score was placed on the piano and he began to play.
After the first few bars, the composer suddenly stopped. As it turns out, the composition required that the hands play at opposite ends of the keyboard while a note was struck at its center.
Not having three arms, the man conceded defeat and Mozart took his turn at the piano.
He began to play the piece and when he reached the impossible note, he bent forward – and struck the key with his nose.
From my years in the senate, I know legislators face a difficult task. Balancing the state budget—particularly in lean times—may make legislators feel as though they are required to play notes on opposite ends of the keyboard and in the middle.
It will be difficult.
It may seem impossible.
And it can be done.
The strength of Utah’s economy tomorrow is directly tied to the quality of education we provide today.
Business leaders have a considerable interest in education because what happens in classrooms across our state directly affects their companies. Students that learn algebra today will be the accountants that balance the books tomorrow. The editor of the school newspaper will market the products that become big sellers. A student taking introduction to civics will be a rising star at a local law firm.
In the last year we’ve seen marquee companies including Goldman Sachs, Microsoft and eBay embrace Utah as a place to grow. The federal government has chosen to build the new NSA Data Center here. And we have some great locally grown companies, as well.
These entities all choose Utah because we have a young, well-educated population. We need to reward the trust they have placed in our ability to produce the best workers. And we need to continue to earn the trust of businesses so they will expand and relocate in Utah, creating jobs for our children and grandchildren.
The famous line from the film Field of Dreams is, “If you build it, they will come.” The same principle applies with education and bringing business to Utah. If we educate our children, the companies and jobs will come.
The business community stands resolute that funding for public and higher education should be funded at current levels as you balance the budget for FY 2011.
As a state we currently spend less of our personal income on K-12 education than all but seven states.
The amount of money we spend per pupil is less than any other state in the union. We’re at the very bottom of the list.
I’m familiar with the same commentary you are:
“Utah educators get more out of every dollar than any other state.”
“Our results are good even with less spending.”
But these old reassurances don’t work anymore. Yes, our educators do a wonderful job considering the resources available.
The world is changing… this country is changing and Utah is changing and we must change the way we educate Utahns.
If you look at any 3rd grade class in the state you see a much more diverse classroom than the one where you learned to write in cursive.
The younger age groups—those in our schools right now—are the most diverse group we’ve ever had in our state. For those over 60 years old the minority population is only between 6.5 percent and about ten percent. But for the age group under five—the next wave of students to enroll in our public education system—one in four students is a minority statewide and in Salt Lake County it’s almost 35 percent.
We are no longer the homogenous state we once were.
From 2000-2007, minorities accounted for one-third of Utah’s population growth and two-thirds of our public school enrollment growth.
Children in 3rd grade classes today are the future of Utah. By 2050, our minority population will double to 30 percent. We must improve educational outcomes for this skyrocketing minority population.
Consider this:
For every 100 Latino students that begin elementary school in Utah, only 40 will graduate from high school. Only four will graduate from college and only one will finish graduate school.
Those numbers don’t work for Utah!
Utah’s student body is changing and we have to re-think the way we teach our students and the way we prepare them to join the workforce.
There are other issues, too:
n Skyrocketing enrollment growth. You know the numbers. Utah public school enrollment will increase by 10,000 to 15,000 students every year for the next decade. We need to provide some $90 million a year to educate these children.
n College readiness for all students. Many high school graduates are ill prepared for serious college coursework. Only 25 percent of our students who take the ACT meet the benchmark score to show college readiness in English composition, algebra, social science and biology.
Utah must improve educational outcomes. For a prosperous 21st century economy, we need to elevate our performance all the way around.
As a business community we have identified three principles to guide our involvement in education:
1. Invest in the most important business input—human capital:
Education fuels Utah’s economy by turning potential into skill. As we develop the best workforce in the nation we will attract millions of research dollars. We’ll attract companies that are not here, encourage expansion in those that are, and generate income for Utahns.
2. Create long-term prosperity:
As a business community we are committed to acting in Utah’s long-term interest no matter how difficult that may be in the present. Education drives economic development.
3. We must act:
There may be nothing so extensively studied as education policy. Many studies have documented the need for educational improvement and innovation. Now is the time to take decisive action to ensure all students get a sound start in reading and math, to better prepare all students for postsecondary education, and to increase participation in postsecondary education.
The Salt Lake Chamber has made a long term-commitment to education.
We’ve done this, in part, because Dr. Shumway came to us and asked for our partnership. It’s a short walk from the State Board’s offices on 5th South to the epicenter of business on 4th South—the Salt Lake Chamber. For far too long, this distance has been too great! Business has been business and education has been education. But no more. It is our pleasure, as Utah’s largest statewide business association to partner with the State Board of Education, the Utah State Office of Education, school districts, local boards of education, charter schools, teachers, principals, guidance counselors, parents, students and the State Legislature to optimize education in Utah. Like many of you have said, “we have promises to keep” and Utah business leaders want to help you as you lead the way.
For the upcoming session we’re asking the legislature to maintain current funding levels for public and higher education.
The fact is, appropriating the same dollar amount as last year is not maintaining the current funding level. It is still a step-back.
This year, public education enrollment will increase by more than ten thousand students. The same amount of money will have to fund the education of a significant increase in students. Even maintaining funding levels leaves educators spreading themselves thin.
We have grave reservations about not funding public education enrollment growth. So far as we know, this is the first time in Utah history that we haven’t funded public education enrollment growth.
We cannot afford to take a step back in education. In a difficult budget year the best we can do may be to tread water. Funding education at current levels—which means avoiding any cuts to public and higher education while accounting for enrollment growth—may be good enough this year, but long-term it simply isn’t good enough.
The business community will push for unified, statewide goals for education and strategies to improve both public and higher education.
Laying the foundation of Utah’s future economic strength means better supporting Utah educators who are doing more with less. They can do even more with more.
Laying the foundation of Utah’s future economic strength means embracing student diversity.
Laying the foundation of Utah’s future economic strength means improving academic results in every ethnic group.
You may be familiar with the story of a water pump in the sand, isolated in a far away desert. A lonely traveler, thirsty and hot, with only an empty canteen, stumbles across the pump.
Tied to it is a hand written sign put there by someone who came before him.
The sign reads: “I have buried a bottle of water to prime the pump. Don’t drink any of it.
“Pour in half of it to wet the leather. Wait, and then pour in the rest. Then pump.
“The well has never gone dry, but the pump must be primed to bring the water up. When you are through drawing water, fill the bottle and bury it in the sand for the next traveler.”
Having come upon this pump in the desert with this sign and being out of water, what would you do? Would you dig the water bottle from the sand and drink it? Or will you pour every drop of that water down into the pump?
While we sit here it’s easy to say we would follow the instructions. The temptation to think of the immediate would be greater in that moment.
We face a similar challenge today. We can make cuts to get us through the tough spot we’re in or we can prime the pump – invest in education — and reap the rewards for years and decades to come.
Investing in the future of Utah’s economy is not always easy but it is the right thing to do.
The time to act is now. The business community views the improvement of education and the improvement of the workforce as a long-term goal—but not an effort with long-delayed successes. We can begin today to make the system better.
As a state, we face unprecedented fiscal challenges. You can leave the legislature but once you’ve been involved in the state budget process, you never can leave it alone. I spend a great deal of time thinking about the challenge we all face as Utahns and the specific challenges you face as public servants and elected officials charged with the duty of balancing the state budget and making decisions with far-reaching ripple effects.
But you and I know… there is more to this than simply balancing the budget. That part is easy. You could simply make a cut across the board at a certain percentage and call it a day. But that’s not in anyone’s best interest. If a business did that… it wouldn’t be in business very long.
The challenge this session is to balance the budget in a way that best positions us, not just for an economic recovery, but to emerge from the “Great Recession” stronger than we were before… better positioned for growth than we were before… and stronger than the competition. We can do that by maintaining our investment in education.
Our future is bright. I firmly believe Utah’s best days lie ahead.
