WISCONSIN

October 2013: Issue 8Official magazine of Wisconsin Manufacturers & Commerce

Inside: October is Manufacturing Month

U.S. Senators Johnson & Baldwin: On Healthcare

Worker's Compensation Updates

FBI: Economic Espionage

Wisconsin TransportationDelivering the Goods

Modernize your organization by leveraging existing applications and pair them with

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WISCONSIN BuSINeSS VOICe

From the editor

I did a little acting in high school: Woody Allen’s “Don’t Drink the Water”… “The Worst High School Play in the World”…. some sort of musical (I assure you the musical was a bad idea, I cannot carry a tune.) The experiences prepared me a little bit for public speaking

and taught me a lot about teamwork, because mostly it taught me what happens when you’re unprepared. If I failed to learn my character and memorize my lines it not only made me look like a fool, it brought down the rest of the cast and the crew.

In all areas of business we must be prepared, and I’m sure many of you would agree you need to be prognosticators to some degree. With the arbitrary fluctuations in the economy, the ever-changing global landscape, workforce and employment issues, constant environmental and healthcare regulatory changes… business leaders have to be ready for anything.

This edition of Wisconsin Business Voice will help you prepare for a lot of things heading your way. The lead article on transportation will give you an overview of the challenges facing manufacturers and others from all corners of the state. Kurt Bauer’s column (p.2) illustrates how some employers tell their stories to their employees and communities, and a column from WMC’s public affairs director (p.12) will tell you why that’s important to our state’s outlook. A column from a special agent of the FBI (p.13) unveils a threat to companies – from abroad and from inside company walls. And Wisconsin’s U.S. Senators Baldwin and Johnson share their thoughts on healthcare reform.

The broad range of subjects in this issue not only highlights the challenge businesses have in being prepared for anything, but also the extensive expertise WMC staff bring to the table when representing our members.

WMC exists to help make Wisconsin the most competitive state in which to do business, and to help you do business better. You are the lead; we are the cast and crew. Together, Wisconsin can put on one heck of an economic show. Please don’t hesitate to call on us if there’s ever anything we can do for you.

Katy Ryder Pettersen Editor, Wisconsin Business Voice kpettersen@wmc.org

In this issue…

transportationpage 4The Challenges of Funding Wisconsin’s InfrastructureJason Culotta, WMC Director of Tax & Transportation Policy talks about Wisconsin’s transportation fund.

page 11Panama CanalDr. William Wilson, Professor in the Department of Agribusiness and Applied Economics at North Dakota State University in Fargo, dissects the expansion of the Panama Canal.

page 14-17Wisconsin’s Transportation System Delivers the Goods

page 19Investments in Transportation Keep Wisconsin MovingSecretary of Wisconsin Department of Transportation Gottlieb talks about modernizing Wisconsin’s transportation infrastructure.

page 28-29Wisconsin Highway ExpansionChamber of Commerce executives John Casper, Oshkosh, and John Beckord, Janesville, share their experiences with helping roadway expansion.

Feature Columnspage 2Show Them the Power of Free EnterpriseKurt R. Bauer, WMC President/CEO, extols the importance of sharing economic impact with employees.

page 7The Reports of Wisconsin’s Demise are Greatly ExaggeratedScott Manley, WMC Vice President of Government Relations, discusses the policies which are helping to create a climate where job growth and economic expansion can flourish.

page 12Educate Your Employees about Wisconsin’s Improving OutlookJim Pugh, WMC Director of Public Affairs, talks about engaging and educating your employees.

page 18Free Enterprise: An Education Worthy of InvestmentJim Morgan, WMC Foundation President, explains the free enterprise system as seen through the eyes of a 16-year old.

page 21Saving Money through Worker’s Compensation ReformChris Reader, WMC Director of Health & Human Resources Policy, makes a case for worker’s compensation reform.

page 23A War on Coal and Just About Everything Else that Fuels the EconomyEric Bott, WMC Director of Environmental & Energy Policy, dissects President Obama’s Climate Action Plan.

page 26Negligent Entrustment: What do These Words Mean to Your Company?Janie Ritter, Wisconsin Safety Council Director, talks about the liability a company faces when employees conduct business on the road.

guest Columnspage 6America Needs ImmigrantsThomas J. Donohue, President and CEO of the U.S. Chamber of Commerce, talks about the need for immigration reform.

page 13Economic EspionageByron Franz, Special Agent for the FBI, reveals some of the real threats to America’s companies.

page 30-31Healthcare ReformWisconsin Senators Tammy Baldwin (D) and Ron Johnson (R) share their thoughts on President Obama’s healthcare reforms.

Wisconsin Business Voice is published quarterly by Wisconsin Manufacturers & Commerce. WMC is Wisconsin’s chamber of commerce, manufacturers’ association, and safety council representing businesses of all sizes and from every sector of the economy. Send address changes to WMC, P.O. Box 352, Madison, WI 53701-0352. WMC's physical address is 501 E. Washington Avenue, Madison, WI 53703, (608) 258-3400. This publication is proudly printed on paper made in Wisconsin.Kurt R. Bauer, WMC President/CEOKaty Pettersen, Editor (kpettersen@wmc.org)Jane Sutter, Designer (jsutter@wmc.org)

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Follow Kurt on Twitter @Kurt_R_Bauer

Show Them the Power of Free Enterprise

Kurt R. Bauer, WMC President/CEO

You know how many employees you have and how

much you pay them in salary and benefits. But have you taken the next step to calculate what the overall positive economic impact your business has on the local and state economy? I urge you to do so and then share that data with your employees, the media and, of course, your local, state and federal elected officials.

The sad reality is that you can’t expect people to know how or what your business contributes to the economy unless you clearly explain it to them. That is especially true at a time when economic illiteracy runs rampant and people have been programed to distrust private businesses and the free enterprise system. Determining your company’s contribution isn’t a difficult task. Many Wisconsin businesses already do it and offer a template from which to work. One of the best examples is Arcadia-based Ashley Furniture Industries, Inc. A one-page fact sheet produced by Ashley shows it has created 4,200 jobs in West Central Wisconsin (in addition to Arcadia, Ashley also has facilities in Independence and Whitehall). The sheet says Ashley’s overall contribution to the Wisconsin economy last year was $358.9 million. That number is broken down by total payroll and benefits, purchases from Wisconsin businesses, Wisconsin investments, utility payments and total taxes paid, including employee withholding, corporate, sales, property and road taxes. Ashley also explains the positive balance of trade the company brings to Western Wisconsin due to product sales in 123 countries, as well as the 2.5 to 3.5 jobs “ripple effect” manufacturers create in other business sectors. Overall, Ashley

says it has helped create 670 local and regional businesses.Ashley produces other fact sheets that effectively explain its role in Western Wisconsin’s economy. One of those sheets lists the number of employees who live in nearby communities and are thus taxpayers and consumers, while another shows the impact of its intermodal yard, one of only seven privately owned yards in the U.S.Another Wisconsin-based furniture manufacturer, KI in Green Bay, also produces a “by the numbers” fact sheet. KI calculates its employees spent $121,037,260 in 2012 and paid $2,287,697 in property taxes and $547,368 in sales taxes. KI also lists its total payroll and fringes, median salary, capital investments, charitable donations, health and wellness programs and its environmental record, e.g., it diverted 500,179 lbs. away from local landfills. Whether your business is manufacturing, retail, financial services, transportation, etc., you should consider taking the time to put some of this data together and distribute it as

widely as possible, including to your employees who may not fully appreciate the bigger picture.

I also encourage you to invite your elected officials to visit your business so they can see firsthand how you are making a positive impact. Such

meetings are also a great opportunity to discuss the issues and obstacles your business

confronts. Complete the visit with a tour of your facilities so elected politicians can shake hands with your employees, i.e., voters.Free enterprise has done more to create opportunity, wealth and to improve peoples’ quality of life than any other economic system in human history. Your business, no matter its size or what sector of the economy it’s in, is part of that impressive and continuing legacy. Make sure people know it by taking the time to tell them. BV

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The Challenge of Funding Wisconsin’s InfrastructureMention the funding of transportation infrastructure and it’s

easy for eyes to glaze over. But Wisconsin and nearly all other states face critical decision-making in the next two years if our current infrastructure system is to be maintained.Let’s start with federal funding. The Highway Trust Fund is supported by the 18.4 cent per gallon federal gas tax (24.4 cents per gallon for diesel), last increased in 1993. The revenues generated by these sources are around $35 billion year, insufficient to meet current spending. Consequently, general tax revenue has been used to backfill the shortage since 2008. When the present authorization of federal transportation funding expires in late September 2014, the shortfall is estimated to total $15 billion annually.Now let’s turn to the state level. The state Transportation Fund is primarily funded by a 30.9 cent per gallon gas tax (presently the 6th highest in the nation) and a $75 vehicle registration fee, which generate about $1.6 billion annually. Due to the economic slowdown and greater fuel efficiency of newer vehicles, less gasoline is being consumed and vehicle registrations are stable. This means future revenues under the current funding system will be flat.A recent report by the Wisconsin Taxpayers Alliance reflects that the average car owner pays around $300 annually in state transportation taxes and fees, lower than all of our neighboring states. Unlike the federal government, state constitutions prohibit deficit spending. Bonding is utilized to make up the difference in expenditures and revenues. The state transportation budget increasingly relies on bonding to finance projects. As the amount of debt and debt service has risen, this practice is not sustainable.While Congress will begin efforts to renew the current transportation authorization in Spring 2014, there is little hope the parties will produce funding stability for the Highway Trust Fund. Inaction by the federal government will put greater pressure on states to resolve infrastructure shortfalls themselves.

Before any discussion can take place calling for additional state revenues for transportation, policymakers and transportation advocates must make a compelling argument to the public that steps have been taken to squeeze out inefficiencies and reduce costs. Regulatory reforms approved last year at the federal level may provide some direction to help the state.After adopting some cost containment provisions, the report* issued by the Wisconsin Transportation Finance and Policy Commission early this year should be consulted next. This report identifies projected needs under several scenarios, and potential revenue sources to meet those needs. Each of the potential revenue sources has negative drawbacks; a future column will be devoted to weighing each of those.The U.S. Chamber of Commerce is in favor of a federal gas tax increase to help meet the Highway Trust Fund shortfall. In addition, several states approved gas tax increases this year while Virginia

approved a gross receipts tax on sales of gasoline (simultaneously scrapping the state gas tax).

Even if a state revenue increase were approved for infrastructure funding, the scale of the anticipated shortfall is so great the Wisconsin Department of Transportation may yet have

to winnow the list of projects by deferring lower priorities. A growing economy – generating more

revenue – would help alleviate these concerns.Significant decisions on Wisconsin’s transportation funding must be reached when the next state budget is considered in early 2015. Our economy relies heavily on the movement of goods and services. How Wisconsin will maintain a strong infrastructure system will be among the most substantial challenges facing policymakers and the business community in the near term. BV*Visit http://www.dot.wisconsin.gov/about/tfp/docs/keep-wi-moving-report.pdf to review the report.

Follow Jason on Twitter @JGCulotta

Jason CulottaWMC Director of Tax & Transportation Policy

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KEYNOTE ADDRESSCharles PayneFounder, CEO & Chief Analyst of Wall Street Strategies; Fox Business Network Contributor; Award-winning Author

“It Can Still be Morning in America”

FEATURED SPEAKERSRobert O’NeilTeam Leader, Naval Special Warfare Development Group; Retired Member, Seal Team Six

“Never Quit: The Story of a Life Built on Successful Missions”

A.B. StoddardAssociate Editor and Columnist for The Hill

“Politics and Public Policy - 2014 and Beyond”

Daniel ChristmanSr. Counselor to U.S. Chamber President

“A Tour of a Challenged World”

PROGRAM EMCEECharlie Sykes Talk Show Host, WTMJ Radio-Milwaukee

Governor Scott Walker will speak on Wisconsin's business climate and his legislative goals.

Business day in madison: FeBruary 6, 2014

Monona Terrace Community & Convention Center, Madison

AgENDA9:20 a.m. Welcome Charlie Sykes9:30-10:30 a.m. “Never Quit, a Story on Leadership” Robert O’Neil10:50-11:45 a.m. “Politics and the Media” A.B. Stoddard12:00-12:30 p.m. Luncheon12:35-1:30 p.m. Keynote Address: “It Can Still be Morning in

America” Charles Payne1:50-2:45 p.m. “A Tour of a Challenged World” Daniel Christman -

Sr. Counselor to U.S. Chamber President3:20-4:00 p.m. Governor Walker4:00 p.m. Adjourn

America Needs ImmigrantsBy Thomas J. Donohue

When it comes to immigration, people are entitled to their own opinions, but not their own facts. And the facts are

crystal clear: Our current system is broken. It’s not serving the interests of our economy, our businesses or our society. Our nation can’t compete and win without the world’s best talent and hardest workers. We can’t sustain vital programs for the elderly and the less fortunate without more employees—both low-skilled and high-skilled—to grow our economy and tax base. We can’t harvest our food, care for our sick or sustain our military without immigrants and temporary workers. America deserves a lawful, rational and practicable immigration system that provides the labor we need at all skill levels, while protecting the rights of citizens, businesses, the undocumented and those legally pursuing citizenship. We must secure our borders and enable people and commerce to flow efficiently and lawfully in and out of our country. We’ve made significant progress by smartly deploying our technology, personnel and programs along the border. Let’s build on that.We need thoughtfully designed employment-based visa programs that would allow employers to use immigrant labor when U.S. employees are not available. Even with high unemployment, we have millions of job openings that go unfilled. Either people will come here to fill those jobs, or the companies will take all their jobs somewhere else. Our visa system should be tied to market demands and include provisions for high-skilled, seasonal, agriculture and

other areas where employers face demonstrated labor shortages. We also need to expand the number of green cards for foreign nationals who graduate from our colleges and universities with advanced degrees. We need a workable, reliable national employee verification system. We are ready to move forward with the national E-Verify system as long as there is strong preemption language for state and local laws, no obligation to re-verify the entire current workforce for private employers, and a safe harbor for employers acting in good faith. Finally, we need to provide a path out of the shadows for the 11 million undocumented immigrants who live in the U.S. today. As we have this debate, let’s not forget who we are, or what this nation was built upon—the dreams and hard work of those who came here seeking a better life.Immigration reform remains a top priority for the U.S. Chamber of Commerce. Now is the time to strengthen our competitiveness, attract and retain the world’s best talent and hardest workers, secure our borders, and keep faith with America’s legacy as an open and welcoming society. BV

Thomas J. Donohue is the President and CEO of the U.S. Chamber of Commerce

In June, 300 students participated in WMC’s Business World summer programs at Edgewood College in Madison and St. Norbert College in

De Pere. These future business leaders learned a lot of valuable information and skills for their future, and had a lot of fun while doing so. With school back in

session around the state, it won’t be long before we resume Mini Business World programs! Mini BW is a one-day, hands-on business program that challenges high schools students to form a “company” and compete against area high schools. In just a few hours, companies design a logo and marketing pieces, make budgetary decisions that relate to marketing, production and finance, and hear from speakers about business practices, interview skills, social media and their personal “brand” as well as generational differences in the workplace.This Fall is shaping up to be a terrific continuation to 2013. Programs are already scheduled for Rhinelander, cargoDoor County, Horicon, Walworth and Wausau before the year is over.

www.wibusinessworld.org @WiBusinessWorld Wisconsin-Business-World

Wisconsin Business Voice 7

The Reports of Wisconsin’s Demise are Greatly ExaggeratedThere is a growing but misguided narrative among Progressive

politicians and segments of the mainstream media that seeks to disparage Governor Scott Walker and pro-business state lawmakers on the economy. Their political spin boils down to four main points. First, they want you to believe that Wisconsin’s economy is doing poorly.Second, they want you to believe that none of President Obama’s policies are negatively impacting jobs or the economy. Third, they hope you are naïve enough to believe that Governor Walker has complete and total control over Wisconsin’s economy. Finally, they would have you believe Governor Walker’s track record of balancing the budget, cutting taxes and streamlining regulations is harming jobs and the economic well-being of our state.Those politicians and their fellow travelers in the media are, of course, wrong on all four points. The reality does not fit their narrative.On the contrary, Wisconsin’s economy has seen job and economic growth during the last few years in spite of gale force headwinds created by overregulation and uncertainty from Washington. A closer look at the data shows our state’s economy is on the right track, and Governor Walker’s policies are helping to create a climate where job growth and economic expansion can flourish.For example, Wisconsin’s unemployment rate has consistently ranked better than the national average during Governor Walker’s term. While other states continue to struggle with joblessness after the Great Recession, Wisconsin’s initial unemployment claims are back down to pre-recession levels.Our unemployment is down because we are creating jobs. In fact, CNBC ranked Wisconsin fifth in the nation for adding new manufacturing jobs, despite President Obama’s punishing policies that hit manufacturing states – like Wisconsin – with higher energy costs. Our progress on manufacturing job creation is especially helpful because those jobs typically pay about thirty-percent more than the state average – they are the very definition of family-supporting jobs.Our economy is growing many other jobs as well. The Federal Reserve Bank of Philadelphia reported in August that Wisconsin

ranked third-best in the nation for job growth over a three month period. Their report also showed Wisconsin with the nation’s twelfth-highest gain in weekly wages, better than every Midwest state but Minnesota. That’s great news for workers.It’s clear the Governor’s reforms have given businesses the confidence to invest in our economy. Analysis by the Private Equity Growth Capital Council shows private equity firms invested $9.1 billion in our state last year, ranking Wisconsin as the fourteenth-highest state in the nation for investment.That level of economic confidence is also reflected in a CEO survey of WMC’s membership taken in June of this year. A staggering 94 percent of respondents believe Wisconsin’s policies are on the right track. That’s an astonishing turnaround considering only ten percent of CEOs thought Wisconsin was on the right track in 2010.Although we have become a society that expects immediate results, it will take time for some of the Governor’s successful reforms to change Wisconsin’s standing in national rankings. Recent income tax cuts, tort, unemployment and regulatory reforms will not be reflected in state comparisons for at least a year or two.Despite the time lag for economic indices and benchmarks, Wisconsin’s progress is already being noticed.The Federal Reserve Bank of Philadelphia ranked Wisconsin with the second-best economic outlook in the country over the next six months. Those economists believe Wisconsin’s growth potential is

better than nearly every other state in the nation.Moreover, Governor Walker’s reforms have

inspired confidence in job creators themselves. Wisconsin moved up for the third straight year to become the seventeenth-best state for business according to a CEO survey conducted by Chief Executive magazine.

The reality is that Wisconsin’s economy is on the right track and we are growing family-

supporting jobs in our state. Although there is certainly more work to be done, we are fortunate to have a bright economic future.The next time you hear a politician cherry-picking an unfavorable piece to economic news in a cynical attempt to make Governor Walker look bad, remember this famous quote popularized by Mark Twain: “There are three kinds of lies: lies, damned lies, and statistics.” BV

Follow Scott on Twitter @ManleyWMC

Scott Manley WMC Vice President of Government Relations

ECONOMICCONFIDENCE

“A closer look at the data shows our state’s economy is on the right

track, and Governor Walker’s policies are helping to create a climate where job growth and economic expansion

can flourish.”

Keeping an “EYE” on Wisconsin BusinessWisconsinEye Network recently conducted a one-on-one

interview with Governor Scott Walker. I sat quietly off camera as veteran journalist Steve Walters peppered the Governor with questions about the Kenosha casino proposal, presidential politics, tougher OWI laws and job creation.The energy in the exchange between these two pros was impressive. Steve’s questions and the Governor’s answers were delivered with passion and candor. It made for an informative, excellent interview.At WisconsinEye, we like to say that whenever knowledgeable, passionate voices come together in such an exchange the result is “must-see TV.” Our programming holds high appeal to those who follow politics, public policy and current affairs. Interest to a broader audience is growing as WisconsinEye advances.In January, WisconsinEye will premiere a new program series Born to Thrive to showcase Wisconsin as a truly amazing tapestry of business innovation, discovery and success.Born to Thrive fits within our broader mission to expose the civic fabric of our state and to inspire personal excellence through candid, provocative conversations that dig into the mindset of top leaders.We will showcase established companies that:• are rooted in Wisconsin, • have achieved a level of national or international stature, and • are turning profits and thriving with innovative and admirable

approaches to human and capital resource management, service delivery, R&D, production, supply chain, logistics, environmental stewardship and community involvement.

Born to Thrive will also spotlight start-ups that: • are rooted in a big, bright idea, • have captured the attention and investment of venture/angel

funders, and • are guided by visionary leaders who are taking the risks to succeed.

Telling these stories will encourage entrepreneurship by illustrating the power of ideas, passion and persistence.We’ll travel around Wisconsin inviting CEOs into candid, honest, provocative conversations about success and failure, competition, risk-taking, and the company’s DNA – that unique set of values that form its collective character.We will target questions that address commitment, pursuit of dreams and overcoming obstacles, and uniquely package that inspiration as a separate classroom resource to encourage students and the next generation of leaders.The January debut will feature an amazing Wisconsin entrepreneur who has built a global enterprise. At the end of the show, that CEO will be handed a list of three companies. He or she will then select the next featured company and its leader and will commit to join that interview. This format will be repeated throughout the production season.Our moderator is new to WisconsinEye, bringing impressive credentials in the business realm and the ability to spark conversations that you will not hear anywhere else. Born to Thrive will be available via regularly scheduled timeslots on WisconsinEye cable TV, the wiseye.org website, the coming WisEye mobile app and other distribution partners. Born to Thrive is a sponsored program series. To nominate a company for consideration or to learn more about sponsorship and recognition opportunities please contact program director Claudia Looze at (608) 316-6850. BV

Jon Henkes is President/CEO of WisconsinEye Public Affairs Network.

Beaver Dam Chamber Celebrates CentennialFor local merchants in Beaver Dam in 1913, commercial prosperity was a top priority. There’s not an exact record of who initially met to discuss the inadequate roads leading into and through downtown Beaver Dam, but one can imagine it was probably downtown shop keepers, bankers and industrialists. They determined business would benefit from investing private funds into road repair and enhancements as more and more automobiles were finding their way to Dodge County. The only impediment was a way to coordinate the efforts of local business. On July 2, 1913 they created the Beaver Dam Merchants and Manufacturers Association – now the Beaver Dam Chamber of Commerce. This summer the Beaver Dam Chamber of Commerce members and public celebrated with events over three days including a Centennial Gala Dinner with remarks from WMC President Kurt Bauer. Part of the celebration was the Grand Reopening of the Chamber’s offices in the Old Downtown Train Depot after a 14-month renovation and restoration of the 1901 building.

Pictured (L-R) are WMC’s Kurt Bauer, State Rep. Mark Born, BDCC Chairman Troy Champ, BDCC Executive Director Philip Fritsche and Congressman Tom Petri.

Wisconsin Business Voice 9

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Employers Seek Global Minded GraduatesToday’s

business world is an increasingly competitive one. To help students prepare for today’s global marketplace, Wisconsin school districts can now adopt a policy awarding Global Education Achievement Certificates to recognize students who demonstrate global competency through academic and co-curricular activities. The Certificate responds to demands from employers who say they want Wisconsin graduates to be career-ready for the multicultural, interconnected world and from students seeking more opportunities to experience other cultures during high school.Any business that continues to evolve and remain dynamic is “going global” whether that means outsourcing or expanding into new markets. Young adults need to be as prepared as possible to hit the ground running once they are hired. High school students are recognizing early on that conducting or representing business almost certainly requires the use of multicultural knowledge and skills. Graduating students will need to be ready to contribute in any environment or situation that their future position might place them in because Wisconsin’s economic success will depend upon the preparedness and ability of students to successfully interact and compete with the rest of the world.Kurt Bauer, President/CEO of Wisconsin Manufacturers & Commerce, called the certificate an important step to support Wisconsin’s global competitiveness. “Foreign investment in Wisconsin companies exceeds $16 billion per year. In 2012, Wisconsin exported $23.1 billion worth of goods to more than 200 countries. It makes economic sense to provide high school students global opportunities to prepare them for the working world of today,” Bauer said. To adhere to budget constraints, the Wisconsin Department of Public Instruction worked collaboratively to develop the new model policy so it can be implemented using existing resources. All the necessary courses are already a part of high school curriculum.

While each individual school district will specify local requirements, the model policy calls for students to take courses in world languages as well as other subjects that have strong global components, to demonstrate cultural literacy, participate in extracurricular activities and experiences with global themes, and to complete a community service project connected to a global community or global issue. BV

Wisconsin Business Voice 11

Panama Canal Expansion By William W. Wilson

The Panama Canal expansion will have major impacts on the world’s shipping and logistics industries. The Canal has

operated at its original capacity since 1914; in the early years demand was not strong and the canal was underutilized. The Canal was controlled by the U.S. until 1999, when control was returned to Panama.Growth in shipping has escalated in the past decade, and demand on the Canal, currently at 14,544 transits per year, is approaching capacity. The volume of shipments through the Panama Canal has also increased due to larger vessel size. The largest and fastest-growing segment of shipments is containers. The second largest segment is dry bulk (e.g., grains, etc.) followed by numerous other segments. Envision the current Canal as a single lane highway for smaller vessels: Ships enter from the Atlantic and Pacific side in single lanes. They pass each other in the channel or in Gatun Lake and proceed to the opposite end to complete their transit. The major features of the expansion include deepening the Pacific and Atlantic entrance channels, deepening and widening the Gatun Lake navigation channel, constructing a new access channel for the Pacific Locks, constructing new Post-Panamax Locks and water-saving basins, and increasing the maximum operating level of Gatun Lake. At a cost of $5.25 billion, the expansion will double the capacity of the Canal and allow more and larger ships to transit. As of August 2013 the project was 64 percent complete. It is planned to be completed and in operation in 2015.The impacts of these changes are dramatic. Besides nearly doubling transit capacity, the expansion will allow larger ships to transit the Canal. The new Canal allows container ships with increased capacity from about 4,800 TEUs (twenty-foot equivalent units) to 12,000 TEUs, and dry bulk vessels with increased capacity from about 70,000 mt (metric tons) to 95,000 mt. Importantly, dredging the Canal will allow an increased draft from 37 to 50 feet to accommodate these Post-Panamax vessels.However, it is important that even larger container ships that will exceed the limits of the new Canal are being built to serve other routes. While this trend is more dramatic in the case of container ships, there will also be pressure for larger ships for the other segments. As an example, ADM (Archer Daniels Midland) has already placed an order for three new vessels at 95,000 mt, ultimately

to conform to the largest shipping capacity possible, likely for soybean shipments from the U.S. Gulf and Brazil to China. The Panama Canal Authority predicts cargo volume transiting the Canal will grow an average of three percent per year, doubling the 2005 tonnage by 2025. As a result of larger ships and more transits, existing ports around the world are being dredged and new ports are being designed and constructed to meet these requirements. A number of ports along the U.S. Eastern seaboard are already prepared to accept larger and more frequent vessels, and others will soon follow. For instance, in Florida, the Port of Miami has partnered with the U.S. Army Corps of Engineers to dredge its harbors and channels to a depth of 50 feet to accommodate big ships; the ports in Jacksonville and Ft. Lauderdale are expected to follow suit by 2017. The Florida department of Transportation has also been at work constructing a tunnel for trucks to transport cargo directly from the Miami port to Interstate 95.When the expanded Panama Canal becomes operational, it should do all it is expected to do – and more. It will likely reshape global imports, exports and trade flows for years to come, affecting nearly every sector of the American economy.What will the expansion of the Panama Canal mean for U.S. industries across the board? A great deal, as the huge cargo ships that will soon make their way through the Canal will make it possible for U.S. companies to source and sell goods to international markets far more efficiently. BV

William W Wilson is a University Distinguished Professor with the North Dakota State University.

A current video by the Panama Canal Authority provides an update of the project: www.dredgingtoday.com/2013/08/22/video-panama-canal-expansion-program-update-august-2013/

Also visit www.pancanal.com or follow the progress on Twitter @thepanamacanal

Educate Your Employees about Wisconsin’s Improving OutlookAs an employer, you have incredible influence with your

employees. Surveys show you are a trusted source of information because your employees look up to you and want to know what you think. So, tell them. Over and over and over again. Just when you think you’ve said it too much, say it again. Especially when it comes to issues that affect the future of your company, your community, your state and nation.Here’s why. Elections are determined by the vast middle. Partisans on the right and the left have already made up their minds. But, independent-minded people can be educated and influenced by those they trust. That’s you.For example, in Wisconsin, we have made tremendous strides at improving our business climate and our jobs outlook. Governor Scott Walker and the pro-jobs Legislature have listened to WMC and our strong membership to pass needed reforms into law – tax cuts, regulation relief and lawsuit reform.But research has found that there is a vast group of people in the middle who are unaware of the progress, and those are the people we have a chance to educate and influence. WMC regularly runs issue ads about jobs and the economy, and our advertising is even more effective if businesses are telling their employees about jobs and the economy.A simple program for you and your company to initiate would be a monthly, or even weekly, email or printed piece geared to your Wisconsin employees. Distribute information to workers as a hand out or even post updates on the bulletin board in the break room.

Here are a few key facts to share with your employees:• Wisconsin’s job outlook is improving because Governor Walker

and the Legislature have made it easier for employers to grow and expand. They cut taxes and red tape, and clamped down on frivolous lawsuits.

• Wisconsin job creators say our state is headed in the right direction. Some 94 percent of CEOs who are WMC members say the state is headed in the right direction.

• The Bureau of Labor Statistics reports that Wisconsin wages outpaced Indiana, Illinois, Michigan and Iowa through 2012.

• The Federal Reserve Bank of Philadelphia issued reports in July and August that put Wisconsin among the top states in the nation for economic growth. In July, we led the Midwest and were second in the nation.

• When Wisconsin’s economy grows and expands, our economy is more prosperous and that helps our employees be more successful too.

Our reforms are working! We need to shout it from the rooftops, and into the emails of our fellow workers.Don’t be shy. This is a proud story to tell. The Wisconsin business community took a leading role in turning our state around, and we should be glad to share our success with our friends and neighbors. BV

Jim Pugh WMC Director of Public Relations

EDUCATINg EMPLOYEES

February 28, 20147:00 - 9:00 a.m.

The Pfister Hotel, Milwaukee, WisconsinKeynote Speaker

Patricia PanchakEditor-in-Chief, Industry Week Magazine

Focus on Manufacturing Breakfast

www.wmc.org

Major Sponsor

Wisconsin Business Voice 13

Economic EspionageBy Byron Franz

In July 2012, managers at the Pittsburgh Corning plant in Sedalia, Missouri, knew two men trespassed twice in June at the

company’s flagship factory. They were asking suspiciously detailed questions about the cellular glass insulation manufacturing process.Just days before, two men seeking to build a foam glass factory in China approached a Corning employee in Pittsburgh, Pennsylvania. Concerned by these incidents, company leadership contacted FBI Kansas City.That’s when Pittsburgh Corning got a call from the Sedalia Democrat, the town’s daily newspaper, about an advertisement submitted online from an email traceable to China.The ad read: “Technical talent wanted to explore together Asian market. You are equipped with more than 10 years experience on foam glass in Corning Pittsburgh? You are able to lead a project to build up a foam glass factory with continuous research on new formulas. You are willing to adventure in Asia for couple of years? We prepared battle field for you.”The Missouri plant produces about 90 percent of the cellular glass insulation marketed by Pittsburgh Corning. Trademarked as FOAMGLAS, the product is used as insulation for buildings, industrial piping systems and liquefied natural gas storage tank bases. China represents a strong market for the product.The FBI conducted an investigation into the case. On September 2, 2012, they paid $25,000 in cash for “stolen” Pittsburgh Corning trade secrets, then arrested two Chinese nationals, Qi Xiao Guang and Huang Ji Li, in a Kansas City, Missouri, hotel room.In January 2013, a judge sentenced Huang to 18 months in prison and a $250,000 fine, and Qi, Huang’s interpreter, to time served, a $20,000 fine and deportation.While the attempt to steal Pittsburgh Corning’s trade secrets was particularly brazen, FBI officials say foreign competitors target U.S.-based businesses, academic and research institutions, defense contractors and government agencies for economic espionage and theft of trade secrets, often with state sponsorship and backing.Theft of trade secrets – commonly called industrial espionage – occurs when someone knowingly acquires or targets a trade secret to benefit anyone other than the owner. A trade secret is basically any information with economic value, which the owner has taken

reasonable steps to protect. Economic espionage is the acquisition or targeting of a company trade secret to knowingly benefit any foreign government, foreign instrumentality or foreign agent. In contrast with theft of trade secrets, those who commit economic espionage have a foreign power as an end user or customer.The FBI investigates and prosecutes economic espionage and trade secret theft using the Economic Espionage Act, signed into law in October 1996.Both crimes are often linked to an insider threat and the growing threat of cyber espionage. An insider threat comes from anyone with legitimate access to an organization’s information, facilities, personnel or technology, using the access to an unauthorized person. The insider uses the access to degrade the organization’s operations, limit

capabilities or admit unauthorized persons.Nationwide, the FBI estimates in the last

fiscal year alone, economic espionage and theft of trade secrets cost the American economy billions of dollars. Within the FBI’s counterespionage section, economic espionage and theft of trade secrets

represent the largest growth area in recent years, a threat expected to only grow.

Over the past four fiscal years, arrests related to economic espionage and theft of trade secrets almost doubled.Through its strategic partnership coordinators (SPCs), located in each of the FBI’s 56 field offices, the FBI reaches out to private companies to help counter the insider threat and cyber intrusions.SPCs currently maintain a network of more than 15,000 contacts within business, academia and government. SPCs educate employees on how to protect trade secrets and encourage employers to obtain non-disclosure agreements from employees and contractors. Sensitive material should be marked as trade secrets or proprietary information, with limited access to protected material and monitoring for those who access it.To curtail the losses associated with economic espionage, FBI investigators should be called in to conduct workplace interviews as soon as there is suspicion of an insider threat. If there is probable cause, FBI investigators can obtain search warrants to search residences and home computer systems, where stolen information is often hidden.Economic espionage is a threat to companies nationwide. If you have questions on how your company can thwart these threats, contact the Milwaukee FBI office. Visit www.fbi.gov/milwaukee for more information. BV

Special Agent Byron Franz, pictured at left presenting to WMC, is an FBI Strategic Partnership Coordinator and is available to provide training and presentations to Wisconsin companies on how to combat these threats. He can be contacted at Byron.Franz@ic.fbi.gov or (414) 291-4371.

“Those who commit economic

espionage have a foreign power as an end user or

customer.”

Focus on Manufacturing Breakfast

14

TRANSPORTATION

“WMC and many other organizations support a constitutional amendment to prohibit the use of transportation funds for non-transportation purposes.”

TRANSPORTATIONWisconsin’s TransporTaTion sysTem Delivers The GooDs By Mark Crawford

An economy won’t go anywhere without a strong transportation

infrastructure to support it. Fortunately, Wisconsin’s outstanding highway system connects to a network of railroads, airports and ports that enable most Wisconsin businesses to efficiently ship their products across North America and throughout the world. “Highway access is consistently ranked by CEOs as one of the top factors for deciding where a company expands or locates,” says Kevin Traas, director of transportation policy and finance for the Wisconsin Transportation Builders Association. “Wisconsin’s highways are our greatest transportation asset.” Wisconsin has over 110,000 miles of high-quality interstate, state and local highways. Almost 90 percent of these roads are local and facilitate the first and last mile for agriculture, timber producers and heavy manufacturers. Further, Wisconsin has a strong partnership with its local units of government. “In fact, Wisconsin is the only state in the country that contracts with all 72 counties to perform maintenance on the state highway system,” says Craig Thompson, executive director for the Transportation Development Association of Wisconsin. “This allows Wisconsin to leverage the manpower and equipment that already exists across the state, without having to hire additional employees.”This vital network of roadways connects to other modes of transportation at key transfer points. Wisconsin has 12 railroads that carry more than 190 million tons of cargo each year. The state’s 29 commercial ports handle more than $7 billion of cargo

annually. The inland waterway system accessed via the Mississippi River is also a tremendous shipping asset for Wisconsin farmers and manufacturers. Wisconsin is served by 133 public-use or general aviation airports that carry about 5.5 million passengers and transport more than 100 million pounds of cargo every year. “Our strong general aviation network is essential for many small and medium-sized businesses that are not located close to a major hub,” says Thompson. The aviation network is anchored by General Mitchell International Airport in Milwaukee—the only airport in the region (including Chicago) that is served by all five of the nation’s largest airlines, as well as Air Canada and Frontier. Mitchell provides nonstop scheduled service to 32 markets. From downtown Chicago, Amtrak offers service to Mitchell—just one of four airports in the nation with an Amtrak station.

maintaining our highways

One of the greatest issues facing Wisconsin is taking care of its interstate highway system, which is nearing the end of its initial life span and needs to be modernized to support economic growth and safe travel for the next 50 to 75 years. “However,” says Traas, “our current funding mechanism will not be able to accommodate these projects and still meet other legitimate transportation needs.”

16

Top-level road projects include Highway 41 in the Fox Valley, I-90 from Janesville to Beloit, and the I-94 “Zoo” interchange in Milwaukee—the busiest interchange in the state.“We have clearly seen that the existing infrastructure cannot support the volume of traffic it is currently experiencing,” says Todd Teske, chairman, president and CEO for Briggs & Stratton in Milwaukee, which relies heavily on the Zoo interchange. “An improved interchange will mean faster shipping, increased productivity, and less travel time for our employees.”A big transportation plus for Wisconsin is U.S. House approval of H.R. 2353, which will allow trucks currently operating on Highway 41 in Wisconsin to continue to use the highway once it has been converted to an interstate in 2014. Without this grandfather provision, trucks weighing over 80,000 pounds would be forced to by-pass Highway 41. “Over 40 organizations, including WMC, supported passage of H.R. 2353 because the 131-mile segment of Highway 41 between Milwaukee and Green Bay is a crucial corridor for economic activity,” says Tom Howells, president of the Wisconsin Motor Carriers Association. “Nearly one quarter of all Wisconsin manufacturers and retail establishments are located along this highway.”Probably the biggest concern for highway infrastructure is restoring and protecting the Transportation Fund. More than $1.3 billion has been transferred from the Transportation Fund for non-transportation programs over the past decade. WMC and many other organizations support a constitutional amendment to prohibit the use of transportation funds for non-transportation purposes. The expected passage of the amendment in 2014 will be a very important first step for financing critical highway projects.

rolling with rail

Rail is becoming increasingly important to the Wisconsin economy, especially as new regulations restrict the trucking industry. The biggest need is shifting freight from over-the-road trucking to rail and rail intermodal transportation—especially on the Canadian National Railway (CN) track between Green Bay and Chicago. “This will pay dividends in reducing congestion, emissions and road wear and improving safety,” indicates John Duncan Varda, an

attorney with DeWitt Ross & Stevens who has worked on freight issues for more than 40 years. “At the same time, such a modal shift will make Wisconsin shippers and receivers more competitive.” CN is serious about Wisconsin—since 2001 it has invested $600 million in the state. It has recently opened a new intermodal terminal in Chippewa Falls, reopened a 40-mile railroad line in Barron County and Rusk County, and spent $33 million upgrading its east-west route between Wisconsin Rapids and Blair.

“We have been meeting with businesses, local officials, and others in the Green

Bay area to discuss the possible establishment of an intermodal terminal in northeastern

Wisconsin,” says Patrick Waldon, CN’s manager of public affairs in the

U.S. “The economic feasibility of an intermodal terminal depends greatly on where the containers come from and where they will go. Getting a better understanding of this information is part of our ongoing discussions.”Improved rail service is also critical to northern Wisconsin. Of the 3,600 miles of rail lines in Wisconsin, 28 percent are out of service. Over 50 percent of these deactivated lines are in the north. Many additional miles of rail have already been converted to trails, thanks to the Rails to Trails Program. Wendy Gehlhoff is director of the Florence County Economic Development Commission and serves as chair of the Northwoods Rail Transit Commission, an eleven-county group fighting to preserve and restore rail service across northern Wisconsin and the upper peninsula of Michigan. “While Rails to Trails has helped tourism, we do not wish to lose any more existing rail lines to trails,” she says. “With the greater distances to markets for manufacturers in northern Wisconsin and high fuel prices, the fuel cost efficiencies of rail become even more important to our businesses for staying competitive.” With Wisconsin’s new mining laws, northern rail lines could have new shipping customers in the future that want to ship ore and supplies. “We need to work with CN to reopen and upgrade its lines for existing businesses in preparation for potential new mining industry business,” adds Gehlhoff. “This is already happening in Barron County, where CN spent $40 million last year on improving rail infrastructure for new sand mining operations. In our region

we can help them connect with new shippers and find backhaul opportunities that will improve their bottom line, such as gravel or wood chips.” Both rail transportation and trucking are important to the forest products industry across northern Wisconsin, which would benefit from strategically placed transloading sites. In particular, timber companies would like to see more short-line rail carriers to service rural areas. “Since rail service left, trucking capacity has increased to meet the needs of the loggers and mills,” states Henry Schienebeck, executive director of the Great Lakes Timber Professionals Association. “This has increased truck traffic, which is wearing down the roads more rapidly.” Sam Gratz, a state legislative affairs representative in Wisconsin for the Association of American Railroads, stresses there is little federal funding available for rail

“Probably the biggest concern for highway infrastructure is restoring

and protecting the Transportation Fund.”

projects. Rail infrastructure, both in Wisconsin and across the county, is funded almost exclusively in the private sector. “In a typical year in Wisconsin, we might see a total investment by railroads of $100 million,” says Gratz. “Railroads have added capacity since the Great Recession and are better positioned to grow as our economy continues to improve.”

making it happen

The 2013-2015 transportation budget proposed by Governor Walker and approved by the legislature increased the State Highway Improvement Program by 11.6 percent and provided an additional $52 million for maintenance through the counties, without fee increases. It also kept the Zoo interchange project moving forward, along with the rehabilitation of the Hoan Bridge in Milwaukee, while still providing increases to local governments for their portions of the system. Bonding was increased and $458 million came from the General Fund to support transportation. “Obviously this does not represent a satisfactory long-term solution to how we fund transportation in this state, but it was a very welcomed budget for a two-year period,” says Howell.

Thompson points out that the reliance on bonding puts Wisconsin in a precarious position moving forward. “If the state doesn’t change its trajectory,” he says, “25 cents of every dollar raised will have to be spent on debt service within the next ten years.” The bottom line is that Wisconsin must design a funding strategy that will be sustainable over the long term. Possibilities include gas tax increases, restoring indexing, taxing gasoline at the wholesale level, and converting to a miles-traveled tax or some other mechanism that grows with the economy. “Fuel taxes and registration fees represent about 90 percent of state transportation revenues,” says Traas. “The fuel tax has been 30.9 cents/gallon (an additional 2 cents/gallons pays for leaking underground fuel tank clean up) since 2006 and we are consuming less fuel in Wisconsin because vehicles are becoming more fuel-efficient. Vehicle registration fees are a flat $75/year, so that revenue stream loses buying power to inflation. We must develop a transportation financing mechanism in which a growing economy produces revenues for transportation that reflect the added demands placed on the system when the economy is good.” BV

Crawford is a Madison-based freelance writer.

Wisconsin Exports by Transportation Mode in (Billion) U.S. Dollars

Share of Total Exports

Percent Change 2010/2012

Perc

ent C

hang

e

20

15

10

5

0

-5

-10

-15

-20

Ocean Vessel10.8%

Air

-15.7%

Truck/Rail to Canada or Mexico

-3.4%

Container Rail or Ocean

12.9%

Ocean Vessel $$$$$$$$$$$$$$$$$$$$$$$$$$$7.40 B

Container Rail or Ocean

$$$$$$$4.22 B

Air $$$$$$$$$$$$$5.30 B

Truck/Rail to Canada or Mexico

$$$$$$$$$$$$$$$$$$6.20 B

Source: WEDC/GTIS

18

During summer, high school students have many more choices than previous generations. They can spend weeks

learning to pick and roll, throw and catch, sing and dance, pass and spike, strum and play. They can also learn about free enterprise and leadership.WMC celebrated its 32nd year of Business World this summer hosting the 64th and 65th programs. I’ve been around for 50 of those 65 programs. I have seen over 10,000 kids go through this program that I know has changed lives. Thirty-two years is a long time and throughout those years we have made many alterations to keep the program fresh. Through technology and creativity, we have crammed more into four days than we used to schedule in seven. We have moved from a lecture-based program to an interactive one. We have added advanced programs for students who want to come back. And, the process of removing the rotary phones from the dorm rooms so students wouldn’t be calling each other late at night, well, let’s just say that is no longer our biggest issue!But there are a few things that have not changed. We have the most committed and talented business volunteers I have ever worked with serving as mentors and advisors. We have incredible corporate sponsors making the program possible for students all over Wisconsin. And we have some of the most innovative, motivated, and energetic teenagers around.And they want to learn… about business… about finance… about careers… about production… about future opportunities… about economics and free enterprise.WMC President/CEO Kurt Bauer addressed the students during the Madison program, sharing his thoughts on the power of the free enterprise system. He offered to have an open dialogue with students, accepting any and all questions (an offer I suggested he give careful consideration to!) His challenge was met with questions like these: “What do you believe will be the impact of the new health

care law on business?” “Why is, or isn’t, Wisconsin a competitive place to do

business?” “What are the critical skills employers are looking for?

And these came from the first year students!!

While I interact with all students at the program, I have the privilege of working closely with the advanced program students, those who return because they enjoyed the experience so much. While the first year students run a company and learn about successful business operations, Wisconsin’s economy, marketing and branding and career opportunities, the advanced program takes it a step further. We add elements of leadership; conduct independent marketing, communications and finance projects; and have plenty of time for discussion.For example, at this summer’s program, a student asked one of our business speakers about an article he had read suggesting the minimum wage be $15. The conversation went something like this:

Student: If this was my company and I doubled wages, my expenses would go way up.

Business person: Yes, they would.Student: Then what happens to all the people that were between

the current minimum wage and $15, wouldn’t their salaries have to go up, too? Otherwise they wouldn’t be rewarded for added responsibility and skills.

Business person: Yes, they would.Student: Then I would have to dramatically increase the cost of

my product or service or cut expenses and lay off people.Business person: Yes, you would.Student: So, at the end of the day, I will have to sell my product

for more, which means I will sell less, and I will have fewer employees.

Business person: Yes, you would.

Economics 101 completed!While we would never claim that every Business World student leaves with all the answers, they do leave with a solid business foundation, critical thinking and leadership skills, and an understanding that, while the free enterprise system may not be perfect, it certainly beats everything else out there.That is an education worth investing in. BV

Follow Morgan on Twitter @JimMorgan1960

Free Enterprise: An Education Worthy of Investment

Jim Morgan WMC Foundation President

TAX EDUCATION

Wisconsin Business Voice 19

Investments in Transportation Keep Wisconsin Moving By Mark Gottlieb

In today’s global economy, Wisconsin companies are more reliant on

transportation than ever before. Large and small companies use our state’s multi-modal transportation network to increase efficiency, improve distribution, expand markets and achieve profits. All companies gain a competitive advantage when we have a good transportation system. That’s why Governor Walker and the Wisconsin Department of Transportation are committed to modernizing our transportation infrastructure. We’re making significant investments in airports, harbors, rail, local roads and transit, state highways and the interstate system. We’re rebuilding bridges and culverts. We're investing in new technologies that help provide for the safe, efficient and predictable movement of people and freight. And, we’re working hard to maintain the existing system, including an improved partnership with counties to deliver the maintenance services that keep state highways safe and functional in all kinds of weather.But more needs to be done to preserve and improve the state transportation system. Based on our department’s asset management model, we’re going to need about $6.8 billion in additional funding

over the next decade. This number doesn’t represent a wish list of projects. It’s a realistic estimate of what’s required just to maintain current conditions. These costs will grow as the system deteriorates from age, use and the harsh Wisconsin climate. There are also heavily traveled corridors like the Zoo Interchange, I-39, I-94, US41 and the Madison beltline that will require sizeable investments to keep planning and construction on schedule.Unfortunately, the user fees that support transportation in Wisconsin are stagnant at best. Our largest source of revenue, the state gas tax, is declining as more fuel-efficient vehicles impact fuel consumption. The federal gas tax has been unchanged for 20 years. The Federal Highway Trust Fund will have insufficient amounts to meet its obligations in the very near future. The purchasing power of revenue won’t keep pace with inflation and the rising cost of labor and materials.We appreciate the legislative support we received for transportation in the current state budget, but future budgets will pose serious challenges. We’re already projecting a $700 million structural deficit in the State Transportation Fund at the start of state fiscal year 2016.

The success of commerce in this state and the country depends on increased investments in transportation. There are many options for growing revenue and creating a more stable and sustainable financing structure. Some ideas were advanced by the citizen members of the Wisconsin Transportation Finance and Policy Commission in a report submitted earlier this year. New financing mechanisms are being successfully used in other states. Ultimately, it will be up to the legislature and Governor to decide what options will work best for Wisconsin. The Department of Transportation will continue to provide the information and support needed to help lawmakers, stakeholders and the general public understand the value of transportation investments. We all have a stake in a transportation system that makes business more competitive in a global economy, improves individual mobility and safety and keeps Wisconsin moving forward.

Mark Gottlieb is Secretary of the Wisconsin Department of Transportation.

West Bend Area Chamber Celebrates 100 YearsOn September 7 the West Bend Area Chamber of Commerce celebrated its 100th anniversary, a “Century of Progress” at the West Bend Mutual Prairie Center. Formed in 1913 as the Commercial Club of West Bend, it has been a significant force in the growth and prosperity of the local business community.The dinner celebrated the history of the Chamber and the many past presidents and board members who steered it through prosperity, wars, depressions and recessions. Lt. Governor Rebecca Kleefisch was the keynote speaker and read a proclamation from Governor Walker declaring September 7, 2013 as West Bend Area Chamber of Commerce Day.

Pictured above are Craig Farrell, Exec. Director of West Bend Area Chamber, Lt. Gov. Rebecca Kleefisch and Mike Nowack, Robert W. Baird Co., Inc.

You see the destination. We see your path.

Insight. Experience. Passion for business. And a promise that we’ll work as hard making your business a success as we do our own. Because to us, the only true measure of our success is yours.

OFFICES IN MILWAUKEE, MADISON, WAUKESHA, GREEN BAY AND APPLETON, WISCONSIN AND WASHINGTON, D.C. © 2013 Godfrey & Kahn, S.C.

Wisconsin Business Voice 21

You see the destination. We see your path.

Insight. Experience. Passion for business. And a promise that we’ll work as hard making your business a success as we do our own. Because to us, the only true measure of our success is yours.

OFFICES IN MILWAUKEE, MADISON, WAUKESHA, GREEN BAY AND APPLETON, WISCONSIN AND WASHINGTON, D.C. © 2013 Godfrey & Kahn, S.C.

Chris Reader, WMC Director of Health & Human Resources Policy

WORKER’SCOMPENSATION

Saving Money through Worker’s Compensation ReformNegotiations are underway in Madison

to reform Wisconsin’s worker’s compensation system. WMC is leading the effort to find reasonable reforms that will contain costs for Wisconsin employers and deal with fraud and abuse in the system. Worker’s compensation is almost always near the top of the list when employers discuss issues they feel need to be addressed. That’s not surprising given the ever-increasing cost of health care, and the ease with which employers can compare what they pay for worker’s compensation claims versus other types of insurance, like group health. For various reasons, the amount paid for a typical worker’s compensation injury is undeniably higher than the amount paid for the same injury covered under a group health insurance plan. In a recent study (Fomenko, 2013) from the Worker’s Compensation Research Institute, it was found that in Wisconsin an outpatient shoulder surgery costs 12 percent higher when the cause is work-related. While that’s better than the 50 percent difference in Iowa and 115 percent difference in Virginia, it still begs the question why the same surgery is billed 12 percent higher for a worker’s compensation claim.So, what exactly is worker’s compensation, and what can be done about the cost differential before it really gets out of control? The worker’s compensation system in our country has been an evolving program for more than 100 years. With

Wisconsin leading the way, states began establishing state-by-state no-fault worker’s compensation programs in 1911. In doing so, workers received protection from the financial burden of workplace injuries, while employers received relief from costly lawsuits. In fact, that’s why the Wisconsin Manufacturers’ Association (the precursor to WMC) was formed in 1911 – to represent employers on unemployment insurance and worker’s compensation issues.Since 1968 the governance of the worker’s compensation system in Wisconsin has largely been handed over by lawmakers to the Worker’s Compensation Advisory

Council (WCAC). The WCAC membership

includes five representatives from management and five representatives from organized labor, and together

they set the worker’s compensation policies

for Wisconsin. WMC has a seat on the management side of the WCAC, and is a leading voice in the negotiations with labor. The policies agreed to by the WCAC must also be ratified by the state Legislature and signed by the Governor. The WCAC has been negotiating for the past several months, and expects to reach agreement later this year on numerous issues to help rein in worker’s compensation costs. At the top of the list of items being discussed is setting a cost-containment mechanism, such as a fee schedule for claims, an effective tool used in many states to stop runaway medical costs.

Other items proposed by the management side of WCAC include:• Reducing the statute of limitations from

twelve years to three for claims; • Requiring all traumatic injuries be

reported within one year; • The denial of indemnity benefits to

injured workers who fail a substance abuse test post-accident; and

• Allowing employer-directed care for the first 90 days of treatment, and several other ideas.

The entire management proposal, as well as the proposals from labor, the Department of Workforce Development and the public can be found online on the Wisconsin Department of Workforce Development’s website, www.dwd.wisconsin.gov.At the time of publication, the WCAC has asked medical providers, such as chiropractors, physicians, and hospitals, to help study the available data and provide ideas on how to reduce costs within the worker’s compensation system. One way could be setting a very specific cost-containment plan, such as a statewide or regional fee schedule. Other ideas include finding ways to reduce the administrative costs by utilizing more electronic billing and payments, and finding ways for worker’s compensation insurance groups to negotiate for better prices, not unlike group health plans. The providers are scheduled to present their findings and ideas to the Council in October, at which time negotiations between management and labor will resume to find a solution to the ever-growing price tag attached to worker’s compensation in Wisconsin. BV

Follow Chris on Twitter @ReaderWMC

“The same surgery is billed 12 percent higher for

a worker’s compensation claim.”

22

625 S. Irish Road

Chilton, WI 53014

(920) 849-7711

Year Established: 1876

Number of Employees: 155 Worldwide, 150 in Wisconsin

www.briess.com

Briess Malt & Ingredients Company – A division of Briess Industries, Inc. It is practically a Wisconsin rite of passage to enjoy a beer and a brat during the summer months in the Badger state. Even so, some may be unaware the handcrafted specialty malts which are involved in the brewing process are made right here in Wisconsin. Briess Malt & Ingredients Company is North America’s leading producer of specialty malts and value-added ingredients for the brewing, distilling, food and pet food industries. In fact, some of the largest and most innovative manufacturers in those industries worldwide are supplied with custom and proprietary ingredients from Briess. At any one time more than 80 percent of the craft breweries operating in the U.S. brew with Briess specialty malts. Producing more styles of malt than any other malting company in the world, Briess sets the benchmark for unique flavor, color and performance in handcrafted specialty malts. Since 1876, this family-owned malting company has been supplying the brewing community with the highest quality malts in the industry. Briess has worked hard to distinguish themselves by developing the most extensive line of specialty malts produced by any malting company in the world. The next time you’re enjoying a cold brew on a hot summer day, remember the malt which gives the beverage its unique taste and color was most likely made in Wisconsin!

208 Adeline Street

Walworth, WI 53184

(262) 275-2151

Year Established: 1901

Number of Employees: More than 9,000 employees working in more than 30 countries

www.usg.com

USG Interiors Inc. – A subsidiary of USG Corporation For more than 110 years, USG Corporation has delivered the innovative products and systems that build the environments in which we live, work and play. As the inventor of wallboard and mineral wool ceiling tile, USG created North America’s building materials industry. The company’s products, including its flagship brand SHEETROCK® Brand gypsum panels, are used in everything from major commercial developments and residential housing to simple home improvements. USG Interiors, LLC, a subsidiary of Chicago-based USG, is a leading manufacturer of acoustical ceiling panels and ceiling suspension grid. USG Interiors’ Walworth plant was purchased by USG in 1959 and has an industry-leading commitment to safety. The Walworth plant employs nearly 100 people and produces ceiling panels and the mineral fiber from which they are made.

W6250 Pioneer Road

Fond du Lac, WI 54936

(920) 929-5000

Year Established: 1939

Number of Employees: 5,400 Worldwide, 3,000 in Wisconsin

www.mercurymarine.com

Mercury Marine – A division of Brunswick CorporationDuring summer in Wisconsin you will be hard pressed to find anyone who doesn’t escape “up north” for a weekend out on a lake. And did you know the engines that fuel summer fun such as boating and water-skiing are manufactured right here in Wisconsin? Mercury Marine, a division of Brunswick Corporation, is the world’s leading manufacturer of recreational marine propulsion systems. Mercury provides engines, inflatable boats, services, parts and accessories for recreational, commercial and government marine applications. Since 1939, Mercury Marine has strived to be the most respected and revered global marine industry leader, enhancing the consumer’s positive boating experience by providing the finest marine propulsion systems and services, integrated electronics, and parts and accessories. It’s safe to say this Fond du Lac-based company will remain a world leader in marine propulsion and technology for decades to come.

34600 County Highway K

Prairie du Chien, WI 53821

(608) 326-4820

Year Established: 1994

Number of Employees: 101

www.dillmanequipment.com

Dillman Equipment, Inc. – A division of Astec, Inc. – A subsidiary of Astec Industries, Inc.Dillman Equipment, a division of Astec, Inc., manufacturers the components needed to build one of the most crucial aspects of the transportation industry; our roads! Dillman Equipment supplies the asphalt/ road-construction industry with a complete line of asphalt plant equipment including asphalt storage silos, DuoDrum counterflow drum plants, coldfeed systems, recycle systems, baghouses, dust silos, air pollution control systems portable asphalt plants, drag slats, transfer conveyors, plant controls, control houses, self-erect silos, asphalt storage tanks, parts, used asphalt plant equipment and field services. Dillman’s 150 associates have been manufacturing, marketing and providing reliable service for a complete line of asphalt plant equipment from their location on the banks of the Mississippi River in Prairie du Chien, though their products are located in almost every state.

MADE IN WISCONSIN

Wisconsin Business Voice 23

Eric Bott WMC Director of Environmental & Energy Policy

ENERGY

A War on Coal and Just About Everything Else that Fuels the EconomyIn June, President Obama unveiled

his Climate Action Plan, calling for reductions in the utilization of coal, America’s most abundant domestic energy resource. As we learn how the Environmental Protection Agency (EPA) plans to implement the plan, one fact is already clear – it’s going to be expensive.An early study from The Heritage Foundation found the proposed regulation would hike electricity rates by 20 percent and eliminate more than 500,000 jobs. That’s a pretty steep price for a policy whose own proponents admit won’t have significant impacts on atmospheric carbon levels or temperature. And since Wisconsin is more heavily reliant on coal for its electricity generation than most states, these costs will fall disproportionately on Dairyland families and businesses. The president’s plan has drawn considerable media attention and deservedly so, but several other pending EPA regulations pose similar problems for America’s economy.

renewaBle Fuel standard (rFs)In 2007 Congress directed EPA to mandate that U.S. fuel supplies contain ever increasing amounts of biofuels until hitting the goal of 36 billion gallons in 2022. For 2013, the mandate required fuel to contain 1 billion gallons of cellulosic ethanol. As of August, only 48,846 gallons of cellulosic ethanol had been produced. Obviously, America is not going to meet the requirements set forth by the all-knowing central planners in 2007.So what does EPA propose to do about this conundrum? They’ve taken it upon themselves to lower the one billion gallon target to just 6 million. Good news to

be sure, but with only 0.8 percent of that objective having been produced, it still begs the question as to where refineries are supposed to get the rest.Then again, that may be a good thing. America has run up against the “blend wall.” Simply put, most engines should not use gasoline blended with more than 10 percent ethanol, yet due to stagnant gasoline consumption trends, the RFS mandates ever higher percentages of biofuels to be blended with gasoline. Use of these blends can threaten the longevity of engines, potentially leaving manufacturers on the hook for millions of dollars in warranty liability.None of these problems would exist if the federal government would get out of the production planning business and allow the market to operate.

ozone

Later this year EPA is expected to issue new National Ambient Air Quality Standards (NAAQS) for Ozone. Early indications are that EPA will lower the standard from the current 75 parts per billion (ppb) to somewhere between 60-70 ppb. A 60 ppb standard would approach dangerously close to what some think are background, or natural, levels of ozone. Under a 60 ppb standard, 96 percent of EPA-monitored counties would be in nonattainment, a status bringing with it a litany of burdensome regulatory hurdles for businesses.In Wisconsin, places one doesn’t typically associate with foul air such as La Crosse, Marathon, and Vilas Counties could be deemed nonattainment. All of Southern Wisconsin would be out of line with EPA

standards and it’s likely the entire Lake Michigan shoreline would find itself in permanent nonattainment, not because of anything Wisconsin can control but primarily due to emissions from Illinois and Indiana.And what about cost? The National Association of Manufacturers estimates a 60 ppb standard would lead to annual compliance costs of $1 trillion and 7.3 million lost jobs. From EPA’s paper-industry-decimating Boiler MACT rule, to the gasoline-price-hiking Tier 3 Fuel Standard, the list of burdensome regulations going into effect is nearly as long as it is costly. In a perverse sense these rules stand as a testament to the resiliency of American enterprise that businesses can continue to grow in spite of government. Just imagine what our economy could do if the regulatory reins were taken off. BV

Follow Eric on Twitter @BottWMC

Celebrate Manufacturing Month in October

Visit www.wimanufacturingmonth.orgFind resources available to manufacturers, community leaders and elected officials

• Dates and locations of many tours and events happening throughout the month

• Links to best practices from employers around the state• Top 10 ways to get involved • Toolkits for hosting tours• Links to Youth Apprenticeship programs

Sign up today for the Manufacturing Month weekly e-newsletter; email Jim Morgan at jmorgan@wmc.org and place the word Newsletter in the subject line.

Manufacturing Month in OctoberCelebrate

Wisconsin Business Voice 25

Company newsWMC Member CEO Inducted into 2013 InBusiness Hall of Fame

InBusiness magazine of Madison named Tim Christen, CEO of Baker Tilly Virchow Krause, a 2013 InBusiness Hall of Fame inductee earlier this summer. Hall of Fame inductees were deemed to have made significant contributions to their companies, the Greater Madison business community, their respective industries and the community at large. Christen is indeed

an example of philanthropic and business excellence given the development of Virchow Krause from a small Wisconsin-based organization into a national and international competitor under his leadership and vision. Christen is most proud of the growth and globalization of the firm. “Madison has been very good to us, and we need to be good to the people of Madison,” Christen said. “I think there is a virtuous circle there.”

Ariens Company Celebrates 80th AnniversaryThis September marked a very important milestone for Brillion-based Ariens Company – its 80th anniversary. Any company surviving eight decades has had its share of ups and downs, but this

outdoor power equipment company made the transition from a family-owned business employing four individuals in 1933 to global enterprise. Dan Ariens, President, interviewed his father, Mike Ariens, Chairman of the Board, in honor of the 80th Anniversary of the company. The two discussed historic events, founding family members, company milestones and acquisitions. Check out the Ariens Company Facebook page to watch video clips from the interview. Incredibly, Ariens has 28 employees whose families have been employed at their company for three or more generations. Those long-standing employees were invited for the Ariens 80th anniversary event.

Governor Walker Attends Northern Wire Anniversary CelebrationThis August, Governor Scott Walker attended Northern Wire’s 40th Anniversary celebration. Northern Wire serves the nation’s industrial markets with custom wire products for agricultural machinery, construction and recreational vehicles. Established in 1973, Northern Wire has grown from a small company manufacturing wear-rods for snowmobile skis to one of the largest privately held wire forming companies in the United States. At the event, Governor Walker said, “I was here in 2011 assessing damages when the manufacturing facility was struck by a tornado. Northern Wire demonstrated resilience and has continued to provide wire products to both Wisconsin and the nation, as well as rebuild and expand despite this setback. Northern Wire is an excellent example of Wisconsin’s manufacturing strength, and we are here to recognize and celebrate the accomplishments of the company and its employees.”

New State Chair Named for Wisconsin ESGRMike Williams, a retired colonel with 30 years of service in the Wisconsin Army National Guard, was selected as the next Wisconsin Employer Support of the Guard and Reserve (ESGR) chairman, an official Department of Defense volunteer position. As state chairman, Williams will serve a three-year term at the pleasure of the Assistant Secretary of Defense for Reserve

Affairs. This position is considered the military protocol equivalent of a twostar flag officer - a major general or rear admiral upper half. Williams, a Fort Atkinson resident, replaces Dick Vallin, who retired after a three-year term as Wisconsin ESGR chairman. ESGR facilitates and promotes a cooperative culture of employer support for the Guard and Reserves by developing and advocating mutually beneficial initiatives, recognizing outstanding employer support, increasing awareness of applicable laws and policies, resolving conflicts between employers and their service member employees and acting as the employers' principal advocate within the Department of Defense.

Gundersen CEO Named Champion of Change by White House

This July, the White House honored Gundersen Health System CEO Jeff Thompson, MD, and 10 others as Champions of Change in the area of Climate and Health. Dr. Thompson was recognized for his visionary leadership in environmental stewardship for healthcare organizations. According to a White House media advisory, "The Champions of Change

program was created as an opportunity for the White House to feature groups of Americans - individuals, businesses and organizations - who are doing extraordinary things to empower and inspire members of their communities." Gundersen Health System is headquartered in La Crosse and serves 19 counties in Wisconsin, Minnesota and Iowa. Under Dr. Thompson’s leadership, the healthcare organization is poised to become energy-independent in 2014. Dr. Thompson stated, "The Champions of Change award is an honor not just for me, but for the thousands of Gundersen staff members who have dedicated themselves to creating a healthier environment for our patients and the communities we serve."

UW-Oshkosh Biodigester Under Construction at Rosendale DairyUniversity of Wisconsin – Oshkosh is expecting to produce an impressive 70 percent of its own electrical needs after the completion of its new biogas production facility and biodigester this December. The biodigester will be the largest of its kind in the U.S. The $7 million dollar facility will produce heat and electricity using livestock waste from 15 miles away at the Rosendale Dairy farm in Pickett. Rosendale Dairy is the state’s largest dairy farm and has more than 9,000 cows. The facility will also serve as a public education center and off-campus classroom and laboratory, as well as generate revenue for new student scholarships for the UW-Oshkosh Foundation.

26

Negligent EntrustmentWhat Do These Words Mean to Your Company?

Is your company protected if one of your employees is in a motor vehicle crash

during the course of their employment? Do you have policies and procedures in place to monitor driving records of your employees who travel as part of their employment? If not, you should. Companies can be held liable for punitive damages if an employee is in a crash while driving for work purposes, whether that employee is using a personal or company-issued vehicle. Employers need a sound risk management strategy to mitigate this risk and potential negligent entrustment lawsuits.Negligent entrustment is not based on the negligence of an at-fault driver, rather on the negligence of an employer who supplies a vehicle to a driver or places them in a situation that requires use of a motor vehicle to conduct company business. The courts may consider whether employees are subject to driving/operating assessments, license record checks, driver safety training or activity/performance monitoring. Regardless of who’s at fault in the crash, if you, the employer, are found to have a poor fleet risk management strategy, you are at risk of a negligent-entrustment claim. Typically, insurance will cover the costs of physical damage and liability. However, commercial automotive insurance usually does not cover punitive damages. In the event a court awards punitive damages, the financial burden might lie solely with the employer because the employer more than likely has ‘deeper pockets’.Some of the things that can be done to limit negligent entrustment allegations include:• Conduct motor-vehicle record

reviews for anyone who operates a motor vehicle on company business or you have allowed personal use of a company vehicle. The review should include driving records in every state of

residence for at least the past five years. Motor vehicle records are protected by the Driver’s Privacy Protection Act and the Fair Credit Reporting Act, so a signed consent form authorizing your company to obtain motor vehicle records is required.

• Check motor vehicle records annually for all employees who are authorized to drive on company business.

• Adopt a policy requiring anyone authorized to operate a motor vehicle on company business to notify the company when they receive citations for driving violations and when convictions occur. Include topics such as adherence to local, state and federal laws; driver recruiting and selection standards; ongoing driver assessments; post-crash reviews; and disciplinary action and standards to the training everyone operating a motor vehicle on company business receives.

• Have policies on drugs, alcohol and prescription medications, personal use of company vehicles, distractions (including a cell phone use policy) and road rage.

• Establish minimum automobile liability limits for personal vehicles used on company business based on average limits in your geographic area. Limits of $300,000/$300,000 per person per occurrence are commonly used. Verify and document coverage for all personal vehicles used on company business and require notification when coverage is lost or changed.

• Schedule maintenance based on

time and mileage and document that each vehicle obtains the minimum maintenance recommended by the manufacturer. Adopt a policy for personal vehicles that requires them to be maintained and inspected.

• Apply your policy across the entire organization without exception and enforce disciplinary action consistently.

Behaviors play a significant role in crashes. Training should address behaviors that contribute to crashes. These behaviors include, but are not limited to, speeding, sudden lane changes, distractions, fatigue, route planning, scheduling and use of in-vehicle technology. It is critical that companies do not send mixed messages. For example, having a no cell use policy while driving then expecting employees to use cell phones while in that environment.Once expectations have been established and communicated, you need to evaluate performance to determine if it meets your expectations. At a minimum, this evaluation should include annual reviews of driving records, performance reviews

using technology, observations

and accident investigations to look for driver and management compliance of your program.

Finally, crash investigations typically

look at driver behaviors after a crash. They are also an opportunity to evaluate management and compliance with the program. For example, after a crash involving speeding, management should be able to answer the following: • Was a driving record established and

followed?

Janie Ritter Director of Wisconsin Safety Council

SAFETY

“Regardless of who’s at fault in the crash, if you, the employer, are found to have a poor fleet risk management strategy, you are at risk of a negligent-entrustment

claim.”

Chapter of

MADISON AREA SAFETY TRAININGoCtoBer 2Incident Investigation: Root Cause Analysis

oCtoBer 11RCRA Compliance for Hazardous Waste Generators Overview (AM)DOT Hazmat Transportation Refresher (PM)

oCtoBer 14-17Safety Management Techniques (SMT)

oCtoBer 23Coaching the Lift Truck Operator, Train-the-Trainer

novemBer 7Safety Communication & Training Techniques

novemBer 13OSHA Construction Breakfast “Managing Contractors to Recognize Job Site Hazards”

deCemBer 4Effective Team Safety

deCemBer 10Lockout/Tagout, Train-the-Trainer

deCemBer 12Worker’s Compensation Law Symposium

MILWAUKEE AREA SAFETY TRAININGoCtoBer 22Coaching the Lift Truck Operator, Train-the-Trainer

novemBer 12Hazard Communication, Train-the-Trainer

deCemBer 9-12OSHA 30-Hour Voluntary Compliance for General Industry

FOX VALLEY/GREEN BAY AREA SAFETY TRAININGoCtoBer 24Effective Team Safety

novemBer 5-6OSHA 10-Hour Voluntary Compliance for General Industry

WAUSAU/STEVENS POINT/MARSHFIELD AREA SAFETY TRAININGoCtoBer 8Safety Inspections

UPCOMING CONFERENCES & EXPOSITIONSdeCemBer 12, 2013Worker’s Compensation Law SymposiumMadison

FeBruary 18-19, 20149th Annual Food Processors Safety Conference/ExpoWisconsin Dells

april 28-30, 201472nd Annual Safety & Health Conference/ExpoWisconsin Dells

Safety Training October - December 2013

The Wisconsin Safety Council, a division of WMC, is Wisconsin's leading provider of safety training and programming. WSC offers training throughout the year at locations across the state.

www.wisafetycouncil.org

• Was the company speed limit policy adequate and followed?• Did scheduling or the compensation system play a role?• Would observations or technology have identified an issue before the

crash? • Did management know the driver routinely violated the speed limits?

Using crash investigations for more than gathering crash data and determining preventability is in your best interest. BV

Follow WSC on Twitter @WISafetyCouncil

WorkEr’s CompENsatioN LaW sYmposiumDECEmbEr 12, 2013maDisoN

This Symposium provides human resource professionals, employers, insurers and health care providers with important legal and compliance assistance for two of the most challenging employment laws and regulations. Each attendee will receive a copy of Wisconsin Worker’s Compensation Law: A Handbook for Employers.

www.wisafetycouncil.org

28

How to Build a HighwayBy John Casper

The section between Highway 26 south of Oshkosh to the Breezewood exit in Neenah along Highway 41 is one of the most traveled sections of the highway, and is critical to the economic well-being of our community and the Fox River Valley.

Planning for that section of the Highway 41 reconstruction project to six lanes began in the 1990s. The reconstruction was based on an objective of then-Governor Tommy Thompson to create a long-term plan for highway infrastructure in an effort to enhance economic development. The Wisconsin State Highway Plan 20/20, which was released during the Thompson administration, identified anticipated congestion levels at certain state highways that would occur if expansion projects were not advanced. According to the report, the congestion level on Highway 41 from just south of Oshkosh to Appleton was expected to range from moderate to extreme if nothing was done to address the capacity. The Oshkosh Chamber of Commerce always believed the expansion was inevitable and had been a longtime advocate for that project. The Chamber gathered data and relevant statistics that would be used to convince the Wisconsin Transportation Projects Commission, and eventually the State Legislature, that capacity needed to be expanded along this corridor. The Oshkosh Chamber played the lead role in creating the Highway 41 Project Coalition, which consisted of Chambers of Commerce including Oshkosh, Fox Cities, Fond du Lac and Green Bay, along with other business and trade organizations, local units of governments, both towns and cities, as well as counties within the Fox River Valley, to support and advocate for the need for the project. Those efforts led to this being the number-one recommended highway reconstruction project of the Transportation Commission at that time. The project was eventually enumerated by the State Legislature in 2003, with an ultimate cost of $550 million.The Wisconsin Department of Transportation was a great partner in this process. A large part of the planning included engaging local communities in the process. While traffic and construction engineers did their work behind the scenes, Department of Transportation representatives began communicating the plan to the community and specifically to the business community as they staged the construction of the project. BV

John Casper is the President & CEO of the Oshkosh Chamber of Commerce.

Wisconsin Business Voice 29

A Coalition to Advance CommerceBy John Beckord

Interstate 39/90 has long been the backbone of south central

Wisconsin’s economy and one of the most vital gateways into our state.

Unfortunately the Interstate has become a bottleneck, as the six-lane section ends just

before the Wisconsin/Illinois border. Expansion of the Interstate has long been a top priority of Forward Janesville,

a 500-member business advocacy and economic development group representing businesses from across south central

Wisconsin. People around here have been talking about expanding Interstate 39/90 for the better part of two decades, but the project never gained much momentum. This lack of progress was frustrating, and three

years ago our leadership decided this project had been on the backburner for too long. We formed the I-39/90 NOW Coalition

to help convince lawmakers and the public that this project was what we needed to get our economy moving again.

The shortcomings of this 45-mile route are readily apparent. Anyone who has tried to head north towards

Wisconsin Dells from the stateline area on a summer Friday afternoon doesn’t need to be told how

congested and dangerous the Interstate has become. The pavement and bridges along

this stretch are severely substandard. Traffic congestion creates frequent and

reliable back-ups. And many of the interchanges are downright scary

and have accident rates much higher than the statewide

average for similar roads.Rather than asking

for a handout, the I-39/90

NOW

Coalition approached the state for a hand “up” - help Rock County attract businesses and jobs to the region by providing us with adequate transportation connections. We argued the congestion and accident rates were a threat to this “commerce corridor,” so named because freight experts at the University of Wisconsin estimate I-39/90 carries $650 to $800 million in economic activity each and every day – commerce that flows to every corner of Wisconsin. We emphasized business expansion and relocation officials consistently rank “dependable highway access” as their top consideration when looking at potential development sites.The efforts of our Coalition generated a groundswell of support among communities, businesses and citizens along the corridor. The state Transportation Projects Commission recommended approval of this project in fall 2010, and it was “enumerated” for construction in the 2011-13 state budget. The $800-plus million dollar project officially got underway in June 2013 with the reconstruction of the Racine Street / Highway 11 interchange in Janesville. If all goes well, the project should be complete by 2021. Visit www.i39-90.wi.gov for more information. Since 2010, Janesville’s industrial building vacancy rate has fallen sharply. Available space is almost nonexistent. Many companies are investing locally, filling space and creating jobs. Our frustration of three years ago has been replaced with optimism about the region’s economic future. Things are looking up here in south central Wisconsin, and this project will only accelerate our recovery. Some have characterized highway expansion projects such as I-39/90 as an unaffordable luxury in these times of tight budgets. However, spending on these kind of projects in the current state budget represents just 11 percent of total transportation spending. In terms of jobs and economic development, this is probably the state’s best return on its transportation investment. At least that’s how we feel in Rock County. BV

John Beckord is President of Forward Janesville, Inc.

30

By U.S. Senator Tammy Baldwin

It’s been over three years since the Affordable Care Act was signed into law

and health care reforms have already made an empowering impact on the lives of many Wisconsinites. The 85 percent of Americans who already have health insurance are now getting better value for their dollars. Today, insurance companies can no longer discriminate against children based on pre-existing medical conditions. Young adults can

stay on their parents' insurance plans up to age 26. Women can no longer be charged more for their insurance than men. And seniors on Medicare receive free preventive care and relief in prescription drug costs. America’s new health care law empowers families and businesses by ensuring health insurance plans are spending their premium dollars on actual care. In 2012, families and businesses saved $3.4 billion on their premiums because of this rule and other Affordable Care Act programs. In addition, families are expected to receive $500 million in rebates with 8.5 million Americans due to save approximately $100 per family this year. In addition, the Affordable Care Act’s small business tax credit helps small businesses afford coverage for employees and is specifically targeted for businesses employing low- and moderate-income workers. The credit is designed to encourage small employers to offer coverage for the first time or maintain current coverage. Small business owners have taken advantage of the law’s tax credit, worth up to 35 percent of their premium contribution and increasing to 50 percent next year, to help provide coverage to employees.Instead of obsessively pursuing efforts to repeal all these reforms, Congressional Republicans should be working to move America’s health care law forward. Instead of threatening to shut down the government unless we repeal health care for millions of Americans, Congressional Republicans should be focused on strengthening the economic security of Wisconsin families and businesses at a time when our state economy is lagging behind the rest of the nation.Moving forward, if we work across party lines, America’s new health care law will provide Wisconsin families and businesses with even greater access to quality, affordable health insurance coverage. But in order to fully realize the health law’s promise, elected officials from both parties need to put politics aside and provide leadership.I am disappointed that Governor Walker has broken with our state’s strong tradition of advancing health care reforms. First, he chose not to build a Wisconsin-made, state-based Health Insurance Marketplace. Instead, he asked the federal government to do it. Even

despite his decision, competitive health insurance marketplaces for individuals and small businesses will be in place January 1, 2014, with open enrollment beginning October 1, 2013. Our state could have seized the opportunity to strengthen our BadgerCare program through a federal partnership. Instead, Governor Walker’s plan covers fewer people at a higher cost to taxpayers. When compared with expanding BadgerCare under the Affordable Care Act, the nonpartisan Legislative Fiscal Bureau estimates the Walker plan will cost state taxpayers $119 million more over the next two years to cover 85,000 fewer people.While the Governor and state legislature have not taken our state down the strongest path, I am committed to making sure that America’s new health care law works for Wisconsin.Uninsured families and Americans who aren’t happy with their insurance will now have better options. They’ll be able to find a plan that fits their budget in the new Health Insurance Marketplace. All plans in the Marketplace must cover an essential set of benefits, including doctor visits, prescription drugs, and mental health services. Discrimination based on gender or pre-existing conditions will be outlawed. And many individuals, families and small businesses will qualify for a break on the costs of their monthly premiums.I am also committed to fixing what doesn’t work. That includes doing what I have done in the U.S. Senate, supporting bipartisan amendments to improve the law, reaching across party lines and finding commonsense areas where we can make it better. I supported two bipartisan amendments to make health care reform better for Wisconsin. I was one of two Democratic U.S. Senators to co-sponsor a budget amendment by Senator Tom Coburn (R-OK) to fix an unfair Medicare reimbursement provision that has been a windfall to Massachusetts hospitals at the expense of hospitals in other states, including Wisconsin. Our state has lost $17 million and will lose more without swift action. I was proud to advance a bipartisan solution to improve health care reform for Wisconsin hospitals, businesses and families. I similarly supported a budget amendment authored by Senator Orrin Hatch (R-UT) to eliminate a tax on medical device manufacturers that I believe could hurt innovation and job creation in our state.Wisconsinites are tired of partisan politics. They want bipartisan action and solutions that work for our state. It’s time to move health care reform forward and put progress for Wisconsin ahead of politics. BV

Tammy Baldwin is a Democrat U.S. Senator from Wisconsin. She can be reached at 202.224.5653.

Healthcare ReformMoving Health Care Reform Forward

Wisconsin Business Voice 31

Healthcare ReformGOP: Unite Against ObamacareBy U.S. Senator Ron Johnson

What can be done about Obamacare?For the majority of Americans opposed

to Obamacare, it is a sad fact that as long as President Barack Obama is in the White House and Majority Leader Harry Reid's Democrats control the Senate, repealing or defunding this monstrosity is next to impossible.Elections have consequences. The 2008 election

gave ideologically extreme Democrats the White House, a House majority and a filibuster-proof Senate, which allowed Reid to jam through Obamacare the morning of Christmas Eve 2009.In 2012, Obama won another term and Reid maintained an iron grip on the Senate. That is a reality that cannot be ignored as strategies are developed to prevent Obamacare from taking firm or permanent root.Even so, opportunities abound to focus attention on the true harm this law is unleashing on the average American's health care, on our struggling economy, on the federal budget and on our personal freedoms.Reid and Senator Max Baucus were correct in calling the implementation of Obamacare a “train wreck.” Numerous unions, strong supporters of the president and his party, are calling for relief. Even Obama acknowledged his administration's inability to implement Obamacare – 3-1/2 years after its passage – by unilaterally delaying the employer mandate and income verification provisions of the law, an act the law doesn't permit him to do.Now is not the time for conservatives to turn a squabble over tactics into a circular firing squad. Now is the time to unite and fight to inform, persuade and win the argument, convincing the American people that Obamacare must be stopped.There is plenty of ammunition. For example, two significant promises Obama made during the health care debate have already been broken. Obamacare did not decrease the cost of a family plan by $2,500 per year, nor will it. In fact, the cost has increased by more than $3,000. And if you like your health care plan, there is no guarantee you will be able to keep it. Just ask the City of Chicago's retired employees who, according to Mayor Rahm Emanuel, will be dumped into exchanges to fend for themselves.Americans justifiably expect that everyone should be treated fairly. Yet the president delays the employer mandate without giving individuals the same relief. If you are young and healthy, you will be forced to buy insurance at highly inflated prices to subsidize the sick and elderly. The Independent Payment Advisory Board (IPAB) will perform the rationing function of Obamacare, making decisions on who qualifies for what kind of medical treatments.

The Internal Revenue Service – Obamacare's primary enforcing agency – has admitted to politically targeting ordinary Americans and is rapidly developing its ability to invade taxpayer privacy by snooping on Facebook and by tracking online purchases. We also know the IRS intends to turn every American's confidential income information over to the Department of Health and Human Services – supposedly under “strict controls.” Every American citizen should be justifiably alarmed.And now the icing on the cake: Responding to congressional pressure, Obama unilaterally – and again without legal authority – exempted members of Congress and their personal staffs from the full, harsh realities of Obamacare.Many of the very same members of Congress who imposed Obamacare on ordinary Americans now want to be shielded from portions of it. Americans are outraged, and they should be.I return to my initial question: What can be done about Obamacare?It should be repealed. Obamacare is one of the worst pieces of legislation ever passed in this nation, but as long as Democrats control Washington, they will never allow that to happen.Republicans should build on the support that House Democrats recently showed in calling for the delay of Obamacare. We should try to remove the most damaging parts and make sure that all Americans – including members of Congress and their staffs – are treated equally under the law. We should then make certain that Obamacare is the preeminent issue in the 2014 congressional elections.Just as important, those of us who oppose Obamacare must assertively acknowledge the very real problems facing our health care system and demonstrate to America that our proposed solutions are better and actually will work.The heart of any long-term solution must give patients more control over their health care decisions. Today, 88 percent of health care is paid by third parties. This system has significantly reduced patient choices and driven up the cost of health care. It has taken the patient – the consumer – out of the equation. Under Obamacare, any future cost controls will be dominated by the heavy hand of government rationing. That dynamic must change.The sooner conservatives unify and start making that case, the better our chances of turning public opinion decisively in favor of total repeal and policies that preserve consumer choice. BVRon Johnson is a Republican U.S. Senator from Wisconsin. He can be reached at 202.224.5323.

This column was originally published in the Milwaukee Journal Sentinel on August 23, 2013.

32

WMC at Home and on the Road

1. WMC staff is proud to have participated in the 2013 United Way Day of Caring. We met a great group of Madison area seniors!

2. WMC’s Government Relations Council recently hosted Joint Finance Committee Chair Rep. John Nygren (R-89th District) to give an update on the Fall legislative session.

3. Some of WMC’s Government Relations team members golfed in the Republican Assembly Campaign Committee outing. (L-R) Scott Manley, WMC Vice President of Government Relations; Speaker Rep. Robin Vos (R-Burlington); Jason Culotta, WMC Director of Tax & Transportation Policy; Rep. Jeff Stone (R-Greendale); and Eric Bott, WMC Director of Environmental & Energy Policy.

4. WMC held a healthcare update featuring a panel of insurance representatives. (L-R) Mike Victorson, President and CEO, M3 Insurance; Stacey Sinkula, Managing Actuary for Small Business, Humana; and Dustin Hinton, V.P. Key Accounts in Wisconsin, United Healthcare.

5. WMC hosted a dinner with Fred Hockburg, Chairman/President of the Export-Import Bank of the United States (left). Pictured with him is WMC Chairman Todd Teske, Chairman, CEO & President of Briggs & Stratton Corporation.

6. Sonoco in Wausau celebrated 10 years injury free. Brian Mirr (second from left), Wisconsin Safety Council Membership & Customized Training Coordinator, visited Sonoco to present a plaque for their accomplishment.

7. WMC representatives met with UW Board of Regents President Michael Falbo to discuss various economic development issues. (L-R) David Brukardt, Associate Vice President for Economic Development, UW System; Tim Higgins, Chair of the Research, Economic Development, and Innovation (REDI) Committee of the UW System Board of Regents; Michael Falbo; WMC’s Kurt Bauer; and Jay Smith, Chairman & CEO, Teel Plastics, Inc., Baraboo.

8. An important part of staying current on all business issues is establishing relationships with international business representatives. WMC’s Senior Vice President Mike Shoys (L) met with Luxembourg Ambassador to the U.S. Jean-Louis Wolzfeld.

9. Taiwanese trade representatives visited WMC to discuss stronger ties between the Republic of China and Wisconsin. Wisconsin’s main exports to Taiwan are medical equipment, machinery and soybeans.

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When your business bank changes your account numbers and the people serving you, then moves local decision making hundreds of miles from Wisconsin, entrusting it to people who know nothing about you or your business, you’re not working with the bank you chose in the first place. If you’ve got to deal with change, why not make a change for the better? First Business offers the services and resources of a large bank, but with decision making and a board of directors right here in Wisconsin. We’ll make changing to First Business easy. Call us today to learn more.

Bank changes creating anegative experience? Make a

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(L-R standing) Corey Chambas, President & CEO of First Business Financial Services, Inc. Joan Burke, President of First Business Trust & Investments

Dave Vetta, President & CEO of First Business Bank - MilwaukeeChuck Batson, President & CEO of First Business Capital Corp.

(L-R seated) Mickey Noone, President of First Business Bank - NortheastMark Meloy, President & CEO of First Business Bank - Madison

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