THURSDAY, JAN. 23, 2020 | IN THIS ISSUE
• RSM economist predicts slow-growth year
• In the CBJ: Watts Group bringing senior co-op to Brown Deer
• NAM chief announces national workforce campaign in Iowa visit
• Coralville's Pier 1 store set for closing
• Iowa City lifts rental permit moratorium
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RSM economist predicts a slow-growth year for the economy
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The probability of a recession in 2020 is waning, said the keynote speaker at the CBJ's 2020 Economic Forecast Luncheon Wednesday, however growth prospects for the economy this year are modest.
Kevin Depew, deputy chief economist for RSM US LLP, said 2019 economic growth will likely come in around 1.8% when the final data is available in the next few weeks, and 2020's GDP growth is forecast at 1.5%. He pegged the odds of a 2020 recession at about one in four.
Deceleration of economic output from 1.8% to 1.5% would be "very significant," said Mr. Depew, because it leaves a low margin of error for the economy to stall out.
"The elephant in the room is the 'uncertainty tax' overhanging businesses relating to trade uncertainty and the trade war with China," he noted. Four areas of the economy are currently in recession or stagnation - manufacturing, agriculture, logistics and energy - due in part to the trade war.
Another area of concern is lagging capital investment, as businesses hold off on borrowing for capital projects until they see where the trade conflict is headed. The recently announced Phase One trade deal with China won't resolve the concerns, because two-thirds of Chinese imports to the United States are still subject to tariffs, averaging about 21%.
Following Mr. Depew's remarks, a more local view of the economy was provided by a panel discussion moderated by Jack Evans, chairman of the Hall-Perrine Foundation.
Panelist Brian Oleson, president and CEO of North Liberty-based Centro Inc., described a challenging environment over the last couple of years and a manufacturing sector in recession. Centro is a producer of large, high-value plastic components used in durable goods such as tractors.
"The tariffs really haven't had a dramatic effect on business, but it's been one of those things that have been an uncertainty so.... people are a little more conservative," he said.
The panel included Mike Gerdin, president and CEO of Heartland Express; Kim Lehrman, president and CEO of Communications Engineering Company; Jerry Waddilove, president and CEO of Southgate Companies; and Kirk Weih, farm manager for Hertz Farm Management.
More than 500 attended the 2020 Economic Forecast Luncheon, which was presented by Bankers Trust, with support from CLA, ITC Midwest, Marco, Eastern Iowa Airport, Kirkwood Community College and UFG Insurance. Look for extended coverage of this year's Economic Forecast event in Monday's print and
digital editions
of the CBJ.
IMAGE: RSM's Kevin Depew offers his firm's thoughts on where the economy will head in 2020 during Wednesday's Economic Forecast keynote.
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In the CBJ: Watts Group bringing senior co-op to Brown Deer
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Coralville’s Brown Deer Golf Course will be the backdrop for the Watts Group’s first foray into housing co-op development, with an ambitious project targeting the lifestyle needs of residents 55 and older.
Pending a final rezoning vote this month, work could begin in late spring on an initial 30-unit community building at Brown Deer Cooperative, located on a high point of land between the golf course driving range and the River Products quarry.
Watts Group acquired the site from the city of Coralville, and was excited about its potential because of the proximity to Brown Deer and the vistas it provides.
The structure was designed by Fusion Architects with a nod to the Prairie School
architecture of the Brown Deer clubhouse, and features a 20-by-60-foot elevated deck off the community room on the golf course side. It’s also within a short walk of the Brown Deer clubhouse.
Watts Group isn’t just relying on the golf course connection to make the project a success, however. The buildings will offer a wider range of amenities than most senior co-ops.
Residents will have access to a workout facility, community room with a bar and fireplace, a dog park, underground parking and a studio apartment that can be reserved for short-term stays by visiting friends or relatives. Units will have a variety of floor plans and balconies.
IMAGE: The front of the planned Brown Deer Co-Op in Coralville, which will be built over enclosed parking. CREDIT FUSION ARCHITECTS
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NAM president announces national workforce campaign in Pella
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The leader of the National Association of Manufacturers (NAM) unveiled plans for a new national capital campaign aimed at addressing the manufacturing industry’s growing workforce crisis during a visit to Vermeer Corp. in Pella on Wednesday.
Jay Timmons, president and CEO of NAM, outlined plans for the "Creators Wanted" campaign during the eighth-annual NAM State of Manufacturing Address, the
Des Moines Business Record
reports.
Mr. Timmons’ address came on the 125th anniversary - to the day - of the founding of the national organization in Cincinnati on Jan. 22, 1895.
The new capital campaign will support the programs of the
Manufacturing Institute
, including the STEP Women’s Initiative; youth engagement through Dream It, Do It; and Heroes MAKE America, a program that trains returning military service members for high-paying manufacturing jobs.
As part of the campaign, NAM will launch a mobile tour this spring aimed at engaging 250,000 Americans with hands-on experiences that demonstrate the high-tech opportunities in modern manufacturing. The campaign also seeks to reach more than 15 million people online. It will conclude this fall in Cincinnati with NAM’s Making America Festival in September.
Vermeer Corp. and another Iowa-based global manufacturer, Pella Corp., have each made $100,000 contributions to the Creators Wanted campaign, Mr. Timmons noted.
Mr. Timmons also spoke on the need to address global climate change, needed investments in U.S. infrastructure and immigration. Broken infrastructure costs each American family an estimated $3,400 in added costs every year, Mr. Timmons said. NAM’s "Building to Win" plan calls for more than $1 trillion in infrastructure investments "to fix collapsing bridges, unclog our highways, deploy 5G capabilities and so much more," he said.
Regarding immigration reform, "manufacturers want a comprehensive solution that fixes border security, addresses economic realities, but also shows compassion," he said.
"We have a full plan ready to go, so don’t tell us it can’t be done. And don’t tell me we don’t have room for immigrants who want to contribute to this country, either," Mr. Timmons said. "There are more jobs to fill in America than unemployed people to fill them. And, don’t forget, nearly half of Fortune 500 companies were founded by immigrants or their children."
To read the text of Mr. Timmons’ prepared remarks, click
here
.
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Coralville Pier 1 store among group of slated closings
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Pier 1 Imports in Coralville will be among the 450 locations the national chain will close as it seeks to cut corporate expenses, including halving its physical footprint.
The chain, which specializes in imported home furnishings and decor, had counted about 950 stores in its portfolio. The company has not yet released an official list, but a store manager confirmed to the CBJ this morning that the 1401 Coral Ridge Ave. store was slated for closure. The manager said Pier 1 officials had not yet been given a definite closing date and referred all other inquiries to corporate headquarters.
Business Insider reports Pier 1 has
erased more than 260 stores
spanning 43 states from its website, including the Coral Ridge Avenue location and stores in Sioux City, Dubuque and West Des Moines. Its location at 1406 Twixt Town Road is still visible on Pier 1's list of active locations.
“Although decisions that impact our associates are never easy, reducing the number of our brick-and-mortar locations is a necessary business decision," Pier 1 CEO Robert Riesbeck said in a release earlier this month. "We thank our team of hard-working associates for their commitment to Pier 1 and to serving our customers.”
The company also said it plans to close some distribution centers and reduce corporate expenses. It plans to use a third-party liquidator to help manage the store closings.
According to a Bloomberg report,
Pier 1
envisions dismissing about 40% of its headquarters staff and has
drafted a bankruptcy plan
. Last month, the company made a presentation to creditors pitching a smaller company with about $900 million in annual sales.
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Iowa City lifts 10-month rental permit moratorium
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After 10 months of restricting the application for new rental housing in certain Iowa City neighborhoods, the city has lifted a moratorium that was designed to give the city more time to figure out what to do, reports CBJ news partner
KGAN/CBS2.
"What are we going to do to really look at our core neighborhoods to make sure that we can do what we can - it's a mixed used of both renters and owners and that's why we put on the moratorium," Iowa City Mayor Bruce Teague said.
Prior to the May 2019 moratorium, Iowa City had their own strategy to deal with what they call core neighborhoods and influx of rentals. Core neighborhoods include Longfellow, Mark Twain and College Green among others. Over the past 10 years the city saw an increase in rental permits in core areas.
Over 75% were rentals and for city officials that number was too high. The city put a cap in place at right around 30% rentals to help those neighborhoods maintain an even mixed look. Due to a change in state law and the legislature making it illegal for city's to enact caps, the solution was no longer valid.
"We would prefer to have more local control," Iowa City City Manager Geoff Fruin said. "The state has taken that away, the loss of that local control is not something we are celebrating. Those decisions are best made local."
The city enacted two new options to better control rentals even without a cap. Radon testing is now required for single and family rental units and parking lots need a nine foot separation to control the amount of yard space paved for parking. The city reached out to residents for feedback and also hopes landlords understand that their effort to try and create a cap is not there to discourage them.
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Short Term Event Planner
Jan. 23
PCI Medical Pavilion 2 Open House
, by Cedar Rapids Metro Economic Alliance, 4-6 p.m., Medical Pavilion 2, 275 10th St. SE, Cedar Rapids. A ribbon cutting ceremony will be held at 4:30 p.m. Tours of the new facility will be offered. Free. For more information, visit
bit.ly/37H9PtZ
.
Jan. 24
Mental Health in the Workplace Webinar
, by Kirkwood Corporate Training, 1-1:30 p.m., online. Learn about the risk factors and warning signs for mental health and addiction concerns, strategies for how to help someone in crisis, and where to turn to for help. Free. To register, visit
www.kirkwood.edu/signup
.
J
an. 27
Coralville Roundtable
, by Iowa City Area Chamber of Commerce, noon-1 p.m., Marquee Pizzeria, 920 E. Second Ave., Ste. 123, Coralville. Members are invited to network and keep up to date with chamber and community events. For information, call (319) 337-9637.
Jan. 28
2020 Crop Advantage Series
, by Iowa State University Extension and Outreach, 8:30 a.m.-4:15 p.m., Radisson Hotel & Conference Center, 1220 First Ave., Coralville. Topics during this meeting will include trade with China, weed management, corn and soybean diseases, grain drying and storage, and a crop market outlook for 2020. Cost: $60. To register, visit
cropadvantage.com
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Headlines from CBS2/FOX 28
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These news items are provided by CBS2/FOX 28
Marion's former police chief is now added to a sexual harassment lawsuit filed by a former custodian who worked for the police department. Court documents show Joseph McHale's name was added as a defendant on Jan. 21, nearly four months after the initial civil suit was filed. Valerie Rheeder worked as a custodian for the department for years. Her lawsuit accuses former Deputy Police Chief Douglas Slagle of repeatedly harassing her. An amended petition filed by Ms. Rheeder's attorney accuses Mr. McHale of violating the law by retaliating against her when she reported her concerns in January 2019. The lawsuit also alleges administrative manager Shellene Gray, asked to meet with Mr. Rheeder in an area where there's no video cameras, grabbed her by the shoulders and threatened her, saying if anyone else found out about the harassment, she would "get" her.
More than 5,800 calls to Cedar Rapids Police in 2019 were for domestic disturbances. That's nearly 25% higher than the five-year average. Local experts say it could be attributed to greater awareness of those in difficult or abusive situations that they can take action and get help. But it's still affecting more people than almost anyone could understand. "1 in 3 women will be victims of domestic violence in her lifetime and 1 in 7 men," says Alexis Chadwick of Waypoint's Domestic Violence Program. "I think domestic violence is an epidemic, the numbers are really high across the nation and our state." Ms. Chadwick says survivors often can't accept the fact that someone they love is hurting them, and incapable of stopping. She added that it's important for people in troubled relationships to understand that it's not just violence that is considered abuse. But for those who are, experts and survivors say it's important to speak out and let someone know there are ways of getting help.
These news items are provided by CBS2/FOX 28
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CBS2 Weather First Forecast
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This first round of snow will wind down this morning and then there may be some areas of fog. Some flurries or freezing drizzle will be possible during the afternoon. Otherwise it will be cloudy and cool with temperatures in the low 30s. The next round of snow starts to develop tonight and moves in after 10 p.m. Light to moderate snow showers will continue through the night and through the day Friday. Snow will start to wind down Saturday morning. Snowfall totals will be around 3-5" in the eastern half of the area with 1-3" to the west. Snow will end early Saturday and it will be cloudy through Sunday. Temperatures will be in the low to mid 30s both days. If snow starts to melt there may be some areas of fog at time during the weekend.
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