Sunday, June 19, 2011

T-Shirts and Bankers

This article was published in part by The Journal in Martinsburg, WV on June 19, 2011.

It all boils down to a t-shirt and it’s on the backs of volunteers throughout the Eastern Panhandle.  We all have one, and if you don’t, you should.  It’s the t-shirt you receive when you give to your community, whether you’re Marching for Dimes or participating in the Day of Caring.  The logos you see on these complementary shirts are meant to recognize those businesses in our area who have invested in a local cause.  Many of those logos represent our local banks and it is our local banks that make up a large part of the philanthropic base here.

Make no mistake about it; you won’t typically see the likes of Citigroup or Goldman Sachs on these shirts.  Bank of America and JP Morgan Chase are not donned there.  Rather, what you will see are banks like the Bank of Charles Town, Centra, Citizens National, Jefferson Security, MVB, and City National, to name a few.  It’s what separates the small bankers of America from the mega-bankers of the world and it’s a distinction many of us fail to appreciate.

Bob Baronner, past President and board member of the Community Bankers of West Virginia and CEO for the Bank of Charles Town, spent some time with me recently to help me understand the distinction.  He describes community banks as having little turnover where bank employees are well known and established in a community.  “Decisions are made locally and community banks give their folks autonomy so that service is better,” says Baronner, “you don’t see that as much with the megabanks.”  Baronner goes on to explain that bankers who live in the community are going to be more interested in the community, so when people go through hard times, a community banker will do more to try to help than a megabank would.  “A community banker will sit down with you, understand your situation, and come up with a solution for your needs.”

What Barroner describes as a local community interest can be easily demonstrated if you think of our local bankers and realize how often you’ve had the opportunity to interact with them in your day to day activities.  How often have you shared lunch with a bank vice president at a Rotary Club meeting or a Chamber function?  People here can walk into their local banks and talk to the bank President if they need resolution.  The local banker’s children go to school with our children.  We sit next to each other at little league games, band recitals, and church functions.  And you just don’t have those same opportunities if you don’t bank locally.  Quite the contrary, megabank CEOs are known for their ability to avoid the general public and to shelter themselves in private elevators and high rise offices so they don’t have to face the realities of the common person’s financial situation. 

But it goes beyond just a simple conversation over lunch or a mutual cheer when our kids’ teams score.  Barroner also describes local banks as being the most charitable businesses in the community, both through financial contributions and volunteer work.  Executive Director of the United Way of the Eastern Panhandle Jan Callen concurs. “It's not just the dollars; it's the volunteers at all levels.  They are so engrained and integrated into the community.”  Callen says the volunteer support from local banks is priceless and describes their willingness to get involved as a culture of community service.  He says that a lot of the big chains are not connected to the community like local banks so you don't see that culture of giving back. “Community service is good business,” says Callen, “and it's just like community banks and megabanks are not from the same breed of cat at all. I just couldn't be more grateful to our local banks.” 

Callen shares that the United Way campaign alone benefited in actual dollars of over $134,000 last year due to local bank support, but he described that as only a small portion of their philanthropic effort.  Callen estimated the value of volunteer support by local bankers to be worth around a quarter of a million dollars, as he described the many projects that local bankers get involved in each year.  “BCT every year takes on a major project.”  Last year they remodeled an entire non-profit office house including laying floors and painting.  Callen describes school business partnerships, 4-H programs, the Future Farmers of America, and the local county fairs as all benefiting from what our local banks provide.  He says that a lot of the local banks even include community service in their mission statements.  “The non-profits could not do it without the local banks,” says Callen.

As banks generally have gotten their fair share of criticism over the last several years, community bankers often feel unfairly lumped in with those mega-bankers whose predatory lending practices helped drive the global economy into what feels like a perpetual state of intensive care.  But the sub-prime mortgage and derivative activities that were occurring at megabanks are based on a different focus than what you see at local banks, where Main Street takes priority over Wall Street. Baronner describes the balance sheets and associated transactions at megabanks as being extremely complicated, but he stresses that local banks’ investments are simpler than that and focus on improvements for the greater community.

The Dodd-Frank Wall Street Reform and Consumer Protection Act was designed to shelter consumers from practices that contributed to our current financial crisis, but regulations and amendments associated with Dodd-Frank have been hotly contested recently by those representing community banks.   Last Wednesday, when the Senate failed to pass the Tester/Corker Amendment to Dodd-Frank, our local banks cried foul.  Barroner explains the purpose of Tester/Corker as one that would give banking regulators an opportunity to study the effects that new interchange regulations would have on community banks and, ultimately, on the consumer.

“Interchange fees refer to the debit card transaction fees that merchants pay to banks and the big box retailers think it’s unfair to charge them for this payment system” explains Barroner.  He describes how the current law if implemented would place restrictive caps on these merchant fees and how small banks who rely on these fees as a source of revenue will now have to compensate for the loss by revising programs like free checking that are designed to make banking affordable to their local customers.  “The cap is a kind of price control and in any kind of business where price controls are present, the small business still has to pay the overhead and will ultimately have to raise fees to compensate for that,” says Baronner.

How the debate nationally will be shaped by the Senate’s inaction and what affect implementation of new bank regulations will have on you and me locally remains to be seen.  It took years to see what affect deregulation of the banking industry would have on our local communities and it will take years to restore an appropriate balance to regulating the industry in a way that doesn’t choke out local banks.  The current economic slump has lingered now for the better part of five years.  Barroner doesn’t give much hope for an economic rebound any time soon and predicts that the real estate market locally will continue to struggle for some time, but what he does assure me is that, as long as local banks are able, they will continue to be an active part of our community.  Baronner sums it up like this, “It’s not all about the bottom line.  It’s about helping people.  And that’s what separates us.  When you experience problems, we’re going to be more understanding.”  So the next time you get one of those t-shirts, whether at a march, or a walk, or any other volunteer effort, pay attention to the logos on the back of the shirt and take the time to thank your local banker.  

Looking forward to seeing you about town!  ~L

Tuesday, June 7, 2011

Trend-Setters in Berkeley Springs, West Virginia

This article appeared in part in "The Journal" of Martinsburg, WV on Sunday June 5, 2011, page D5

Trend-setters.  They can make a business or break it.  They have been targeted in stealth marketing campaigns, researched as a phenomenon by the likes of Malcolm Gladwell and Duncan Watts, and aspired to by rising generations including the Boomers, the X-ers, and the Y Generation.  They have been labeled revolutionaries, influencials, and Indies, to name a few.  They are, perhaps by their own design, misunderstood, evaluated, criticized, and imitated.  But it is their creativity, their imagination, and their innovative ideas that have brought to fruition realizations such as harnessed electricity, democracy, Sputnik, and the Internet.

Trendsetters are not typically found at a run of the mill operation, but are more often part of the fray, making up an aspect of the fabric that gives its essence beauty and life.  Trendsetters define contemporary, establish fashion, and personify the arts.  They are the earliest of adopters, but the first to move on to explore new ideas.  A diverse and interesting business community will offer havens for trendsetters to mingle, to explore their creativity, and to garner strength for their ideas from the creativity of those around them.  Such havens can be found in places like Soho, the French Quarter, and Niagara on the Lake.

I spent some time this weekend at just such a haven right here in our own backyard. A place that distinguishes itself as being one of the only towns in the country that can boast more massage therapists than lawyers, it is a place where our founding mothers and fathers used to get away for a few days so that they could relax in bath houses and take advantage of fresh spring waters.  The rural setting, small town feel, live sidewalk music, and small boutiques and cafes set the stage for a relaxing and enjoyable experience.  An emphasis in art, healing, and history is evident.  The local ice cream shop becomes a social gathering for those who want to escape the heat and, if you want to catch the newest flick, you can do so at one of the country’s last surviving downtown cinemas.  It is our very own Berkeley Springs, and it is a thriving and fundamental component to the greater Panhandle’s business community.

If you know anything about Berkeley Springs, you know that its voice is often expressed by the one and only Jeanne Mozier.  Mozier, author, business owner, self-proclaimed “popcorn empress” at the Star Theater, and a Cornell grad no less, is herself a trendsetter, and one who thrives in the atmosphere that makes up Berkeley Springs.  She describes her town as having a dynamic leadership and attributes that to the support that comes from being a creative person in the Berkeley Springs community.  She explains the common thread that binds its business members’ collective vision.  “The notion that Berkeley Springs is itself a brand and that everyone does their part in their own unique way to contribute to that brand is what makes Berkeley Springs,” says Mozier. “People feel that connection. And when we feel it as part of the business community, people feel it when they come.  So when people come to visit, they want to come back and often will eventually stay.”

Mozier goes on to say that “one of the things that makes Berkeley Springs unique is that historically there has always been a flow of outside energy such as the founding fathers and industrialists who came to build their summer cottages and who brought electricity to town.”  The attraction to outsiders is still at play, as Mozier explains that “this in-migration of creative people now make up the people who are retiring here and starting their own businesses and doing their own kinds of interesting things.” She explains how this constant influx of new people creates a business culture where things don’t get stuck in an entrenched power structure, but instead allows creative change and rejects the notion that things should always be done the same old way.

A nice getaway location, yes, but Berkeley Springs isn’t so out of the way that it’s not attractive to new business development.  “We’ve done such a good job at selling Berkeley Springs as a weekend getaway that people forget how close it really is to places like Frederick and Baltimore,” says Bill Clark, Executive Director of the Morgan County Development Authority. “We have access to big population centers even though we’re in a more rural setting.”  Examples of businesses that have found a home in Berkeley Springs include places like US Silica, as well as Caperton Furniture Works, a unique and growing online furniture distributer.  Additionally, Washington Homeopathic Products, the second largest homeopathic manufacturer in the nation, is headquartered in Berkeley Springs.  

Mountain View Solar and Mock’s Greenhouses are also headquartered there, two of the area’s most rapidly growing businesses that are attracting attention from the State and other businesses up the East Coast.  Berkeley Springs Water Works and Berkeley Springs Instruments are also important pieces to the business landscape there.  Bob Margraff, a resident Business Executive and Consultant in Berkeley Springs, is pleased with the support that the Development Authority provides to new and growing businesses in the region. “They work hard to assist area business and support an environment in which companies like these can develop,” says Margraff,  “the Development Authority will assist in finding investment resources and will stay involved with smaller businesses to be sure they can grow.”

Smaller businesses in Berkeley Springs that make up the town’s eclectic culture include those like Ridersville Cycle, the Lion’s Lair, Tari’s Cafe, Nature Niche, and Temptations Too Bakery.  There are seven spas in Berkeley Springs, including the nation’s first spa and the historic bath of President George Washington.  It’s the home to beautiful Cacapon State Park and a dozen or so bed and breakfast destinations.  Mozier shares that the town has a very active and very inclusive Chamber of Commerce, an engaged Development Authority, and a thriving Convention and Visitors Bureau that identifies itself as Travel Berkeley Springs.  These groups work closely together to ensure that local business has the support that it needs.  The Morgan Arts Council is also a valuable resource to artisans and shop owners who make a living selling unique and interesting art to weekend tourists.  All of this and more is what makes Berkeley Springs the perfect backyard escape where people from all over the Panhandle and beyond can take their friends and out-of-town visitors to show off our area.

So how can area business leaders become a part of the trendsetting culture in places like Berkeley Springs?  Mozier offers this final word of advice, “What you do needs to be authentic.  This town exists by virtue of legislation that incorporated the vision into its establishment, which is to encourage and build housing and support for those persons who came to take advantage of the waters for their health. Know what is authentic in your area and how you can use that resource to expand your own business.”  And with that, you’ve got the secret of the trendsetter.  Looking forward to seeing you about town.