Top executives of Sterling Financial Corp., which is back from the brink after completing one of the largest recapitalization plans ever for a Northwest bank, begin this week to put in place the strategy that will grow what in essence is a whole new bank. They’re not out to restore the bank that was, but to build a new Sterling.

Ever since the October day when Sterling CEO J. Gregory (Greg) Seibly was thrust into the top role as the Fed issued a cease and desist order and forced the board to oust Chairman Harold Gilky and CEO Heidi Stanley, he has operated under the burden of control by the Fed and the relentless demand for recapitalization.

Completion of a $730 million recap effort last week that included investments from Warburg Pincus LLC and Thomas Lee Partners for a $342 million combined stake and about 45 percent ownership lifted the cloud and assured an independent future for Sterling Financial, parent of Sterling Savings Bank.

In addition, a group of about 30 investors committed $388 million, including about $100 million from international investors. And the U.S. Treasury has a 9.3 percent stake in the form of common stock.

Throughout 2010, the assumption of many was that being acquired was the only future for Sterling, which had grown from its launch in Spokane in 1983 into a multi-state bank with 178 branches before it was hammered by the housing downturn and a portfolio filled with mortgage loans. It had $1.8 billion of construction loans on its books.

Now it’s likely that Sterling, with $9.7 billion in assets and with a five-state footprint, will become an acquirer, picking from the array of troubled banks that remain in Washington State and beyond.

Seibly and new chairman Les Biller, along with a reconstituted board, can now pursue what all agree will be an agenda of first restoring profitability, then seeking to expand, with Biller emphasizing: “But we’ll do growth in a sane and smart way, focusing only on deals that make sense.”

Seibly, when asked about Sterling’s future growth, said “the goal is to stay in states we are in (Idaho, Montana, California and Oregon, in addition to Washington).” But he suggested he sees particular opportunities for growth in the Puget Sound Area, Portland and the Bay Area.

An unusual professional relationship will mark the joint effort of Seibly and Biller, who presides over his first board meeting this week, to restore health and pursue growth. They’re supported by an executive team that includes Chief Operating Officer Ezra Eckhardt and a new board Seibly describes as “possibly without peer among $10 billion banks.”

Biller was vice chairman of Wells Fargo from the  mid-90s through 2002 as Seibly, then in his early 30s, moved quickly up the executive ladder to become executive vice president and division manager for Los Angeles/Nevada commercial banking.

They then went in different directions as Biller retired in 2002 at the age of 54 and Seibly, who is now 47, moved on to U.S. Bank, eventually arriving at Sterling in 2007.

It was a serendipitous series of events that reunited the two, starting with an invitation from Biller, part-time transplant to Seattle, for Seibly to visit at Les and Sheri Biller’s new Seattle home early this year to “get reconnected.”

As Biller recalled when the chairman announcement was first made in June: “After we started talking, I got more interested in Sterling and they in me.”  That eventually led to Biller agreeing to take the chairman’s job, subject to Fed approval. That approval came with completion of the recapitalization.

Seibly credits Biller’s decision to return to the banking world as Sterling chair as one of the key reasons the bank was able to put together the $730 million recapitalization, with investors impressed with the credentials Biller brought to the bank.

Both suggest the coach and mentor role that Biller played at Wells will continue at Sterling.

“He will be both coach and mentor,” Seibly said. “He has a great wealth of knowledge and a key contribution will be to get his prospective on what we do strategically.”

Asked about the negative image banks are facing amid accusations of credit unavailability, Seibly said: “A couple of years ago, it was the best of times in terms and price. What we’re seeing now is people can’t get credit on the terms and prices they like.

“Credit is available, it’s just more costly, and with tighter constraints than borrowers were used to,” he added.

“Banks are looking to make quality loans,” Biller said, addressing the same question. “But the days of easy money and cheap pricing are gone. The pendulum definitely had swung too far in terms of easy money and price. Now it may be swinging a little too far the other way.”

But to emphasize that the initial focus will be on a return to profitability, Biller said: “I want to stress that we’re not going to be pushing the peddle to the metal on growth until we’re profitable.”

 

 

 

As summer gives way to autumn, longings for the long ago can creep into the days for the sentimental among us and so it is that I sometimes find myself revisiting the days of youth when, somewhere between girl friends, I fell in love with a ’55 Thunderbird. She was white with turquoise interior and had both a soft and a hard top.

I thought about her recently because it’s a special anniversary of sorts: 55 years since the Ford Motor Co. debuted in 1955 what its marketing folks described as a “Boulevard Sportscar.”.

The original T-bird was already a classic by the mid-'60s when I saw one on a car lot in north Spokane, swung in to try it and drove out 30 minutes later, sitting proudly behind the wheel -- one flashy car richer and $1,200 poorer.

Of course that $1,200 has grown by as much as 30 times for those T-Birds who’ve kept their shape and sharp looks and are still nurtured and occasionally driven by those whose love affair with the car remains, making it one of the best investments ever for anyone who held onto one.

The T-Bird was more sophisticated and urbane in its concept than Chevrolet's muscular Corvette, which debuted at the same time and shared stage with the T-bird as the first two-seat American rivals of the European sports cars.

There was something about the jump and roar of the White Lady, half of whose length was hood and the high-horsepower engine that churned beneath it, that stirred the blood.

The car lured Betsy, a co-ed I’d met in math class, and I taught her how to drive a stick shift as she sat behind the wheel of the T-Bird. To this day I'm not certain she didn't fall in love with the car and thus, of necessity, fell for the owner.

Of course it was never meant to be a family car, so when family loomed, the car and I had to part.

But there came a time, as kids reached high school and age began to leave its mark that a gentle tug of longing to own one again began to visit me. I made the mistake of sharing the urge with Betsy and the kids and it soon became sort of a family joke.

They gently poked fun at the idea, whether it was with a three-inch toy version at Christmas or a recording of Mark Cohn's "Silver Thunderbird" on my birthday one year (I played the song probably 100 times over the next few days).

Ford produced the two-seat T-bird for only three years, adding fins and portholes in 1957, before succumbing to whatever urges move automobile manufacturers’ decisions and it turned the Thunderbird into just another sedan.

But then in 2002, the automaker undertook the tallest of orders, seeking to reinterpret an icon, reintroducing the two-seated Thunderbird. It couldn’t be too much of a copy of what had gone before, but it couldn’t depart too much from the inspiration.

As I looked at an auto magazine spread with pictures of what Ford envisioned for the new Thunderbird, I began to have a queasy feeling, a realization that there would be disappointment if I thought of buying one, or even giving it a test drive.

Ford has sold thousands of the attractive retro T-Birds since it was introduced anew and most drivers have certainly appreciated the experience of owning one, but most have been unencumbered by memory. They never owned one of the originals.

But for me, growing older had brought the slow realization that the longing that stirred occasionally wasn’t just about a car, it was also about a time.

I could own a re-creation of a car, but I couldn’t drive it back to the time. My wife and family understood that a long time ago.

 

 

Don Nielsen, who for more than a decade was perhaps Washington State’s most visible and vocal advocate for fixing what he saw as the ills of the public education system, thinks President Obama’s Race to the Top funding challenge to the states will have a positive impact on the quality of education.

“His innovation grants are pushing the states to move faster toward education innovation than they might feel comfortable with and some good will come from that fact alone,” said Nielsen, who long ago decided that he was wrong in his conviction that education reform had to come from the local level.

The President’s education initiative has generated stiff competition among states involved in the race for federal cash from grants the administration promises will be worth up to $700 million for states that show the greatest willingness to push innovation and implement tough testing standards for local schools. But it has also drawn some strong resistance in some quarters.

But while Nielsen thinks the use of financial incentives to get the states to innovate “on balance will be positive,” he forcefully adds “I don’t want the federal government mandating a national test.” He suggests a standard test could emerge from among various testing methods being tried in various states.

Nielsen’s conviction that the education system needing fixing and the gradual realization that the necessary changes could only come at the state level came about first from a two-year odyssey to study schools and then from the inside as a Seattle School Board leader.

His quest to “learn what was wrong with the nation’s public education system” was what prompted his information-gathering tour of the country in the early ‘90s, an unlikely post-retirement commitment for a man who had built Virginia-based Hazelton Laboratories Corp. into the largest independent contract laboratory in the world.

He was chairman, president and CEO of the firm and had made his fortune when he decided in 1992 to retire and focus on education.

After his odyssey, Nielsen returned home to Seattle and ran for the school board, being elected board president in his second term.

He didn’t run again, he says, because he learned he had been mistaken in thinking that change had to come from within the system and primarily in urban areas in order to make a difference.

“I came to realize that the entity of change wasn’t going to be the school district. It had to be at the state level,” he says. “So then you have to figure out what state could become the model for change. I didn’t see any hope that Washington could be the state but I figured Virginia could be.”

Nielsen has been less visible in the education field in the past several years because of the need to focus his attention on the fast-growing family business he oversees, prompting his comment in an interview that he’s “not as engaged in education as I once was.”

But the comment isn’t meant to imply that he’s retired from the fray on behalf of changing public education. He is continuing to work long distance with state and community leaders in Virginia, which he singled out two years ago as a state that “has a chance to do education the way it needs to be done.”

His family business is LightDoctor, a six-year-old commercial lighting and maintenance company that is focused on reducing energy needs with what they describe as “innovative lighting solutions.” LightDoctor, located in Mountlake Terrace northeast of Seattle, has major customers around the Pacific Northwest and, according to Nielsen, “could easily grow 80 percent this year.”

Despite the focus on his business, he remains an opinion leader with respect to education, with controversial viewpoints that have emerged from those years of commitment to seeking solutions to education’s woes.

For example, he says his experience is that “individual merit pay inside a school building is destructive to the culture of a school, more injurious than helpful. Sure, people like black-and-white solutions but this is very gray.”

What he touts instead is a whole-school bonus system for elementary and high schools, arguing “it’s more fair to have a system in which all teachers participate, challenge each other, and be rewarded together. Schools need to be treated like high-performance work teams.”

He suggests that “unions are not the source of the problem in public education, but they are the constraint in fixing it. The problem in public education has been management, not the unions. The unions have become strong because schools have weak management.”

And to those who insist more money is needed for schools, Nielsen says “I don’t think schools are underfunded. Money is not the constraint, rather it’s that we’re spending money in ways we shouldn’t.”

That’s an observation that he’s quick to point out relates to K-12, not to higher education, which he sees as facing a different array of challenges.

What the education system needs, which he says he and others hope can be achieved in Virginia  because of favorable response from business and academic leaders, is “elimination of certification laws, a change in the way we select and change school leadership and having school boards become appointed in urban areas,” he suggested.

He says Virginia has already achieved some education innovations with an agreement a few years ago between the state’s five largest public universities and the governor on a plan that was approved by the legislature.

“The major schools agreed to never ask for a higher percentage of state funding in exchange for no state regulations,” Nielsen explained. “That meant the state backed off on things like employment regulations, purchasing, contracting and the like and left those in the future to the schools themselves.”

The pushback some areas of the country have evidenced toward Obama’s innovation initiative suggest those steps will come about only with some struggle.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Don Nielsen, who for more than a decade was perhaps Washington State’s most visible and vocal advocate for fixing what he saw as the ills of the public education system, thinks President Obama’s Race to the Top funding challenge to the states will have a positive impact on the quality of education.

 

“His innovation grants are pushing the states to move faster toward education innovation than they might feel comfortable with and some good will come from that fact alone,” said Nielsen, who long ago decided that he was wrong in his conviction that education reform had to come from the local level.

The President’s education initiative has generated stiff competition among states involved in the race for federal cash from grants the administration promises will be worth up to $700 million for states that show the greatest willingness to push innovation and implement tough testing standards for local schools. But it has also drawn some strong resistance in some quarters.

But while Nielsen thinks the use of financial incentives to get the states to innovate “on balance will be positive,” he forcefully adds “I don’t want the federal government mandating a national test.” He suggests a standard test could emerge from among various testing methods being tried in various states.

Nielsen’s conviction that the education system needing fixing and the gradual realization that the necessary changes could only come at the state level came about first from a two-year odyssey to study schools and then from the inside as a Seattle School Board leader.

 

His quest to “learn what was wrong with the nation’s public education system” was what prompted his information-gathering tour of the country in the early ‘90s, an unlikely post-retirement commitment for a man who had built Virginia-based Hazelton Laboratories Corp. into the largest independent contract laboratory in the world.

 

He was chairman, president and CEO of the firm and had made his fortune when he decided in 1992 to retire and focus on education.

 

After his odyssey, Nielsen returned home to Seattle and ran for the school board, being elected board president in his second term.

 

He didn’t run again, he says, because he learned he had been mistaken in thinking that change had to come from within the system and primarily in urban areas in order to make a difference.

 

“I came to realize that the entity of change wasn’t going to be the school district. It had to be at the state level,” he says. “So then you have to figure out what state could become the model for change. I didn’t see any hope that Washington could be the state but I figured Virginia could be.”

 

Nielsen has been less visible in the education field in the past several years because of the need to focus his attention on the fast-growing family business he oversees, prompting his comment in an interview that he’s “not as engaged in education as I once was.”

 

But the comment isn’t meant to imply that he’s retired from the fray on behalf of changing public education. He is continuing to work long distance with state and community leaders in Virginia, which he singled out two years ago as a state that “has a chance to do education the way it needs to be done.”

 

His family business is LightDoctor, a six-year-old commercial lighting and maintenance company that is focused on reducing energy needs with what they describe as “innovative lighting solutions.” LightDoctor, located in Mountlake Terrace northeast of Seattle, has major customers around the Pacific Northwest and, according to Nielsen, “could easily grow 80 percent this year.”

 

Despite the focus on his business, he remains an opinion leader with respect to education, with controversial viewpoints that have emerged from those years of commitment to seeking solutions to education’s woes.

 

For example, he says his experience is that “individual merit pay inside a school building is destructive to the culture of a school, more injurious than helpful. Sure, people like black-and-white solutions but this is very gray.”

 

What he touts instead is a whole-school bonus system for elementary and high schools, arguing “it’s more fair to have a system in which all teachers participate, challenge each other, and be rewarded together. Schools need to be treated like high-performance work teams.”

 

He suggests that “unions are not the source of the problem in public education, but they are the constraint in fixing it. The problem in public education has been management, not the unions. The unions have become strong because schools have weak management.”

 

And to those who insist more money is needed for schools, Nielsen says “I don’t think schools are underfunded. Money is not the constraint, rather it’s that we’re spending money in ways we shouldn’t.”

 

That’s an observation that he’s quick to point out relates to K-12, not to higher education, which he sees as facing a different array of challenges.

 

What the education system needs, which he says he and others hope can be achieved in Virginia  because of favorable response from business and academic leaders, is “elimination of certification laws, a change in the way we select and change school leadership and having school boards become appointed in urban areas,” he suggested.

 

He says Virginia has already achieved some education innovations with an agreement a few years ago between the state’s five largest public universities and the governor on a plan that was approved by the legislature.

 

“The major schools agreed to never ask for a higher percentage of state funding in exchange for no state regulations,” Nielsen explained. “That meant the state backed off on things like employment regulations, purchasing, contracting and the like and left those in the future to the schools themselves.”

 

The pushback some areas of the country have evidenced toward Obama’s innovation initiative suggest those steps will come about only with some struggle.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The company has major customers around the Pacific Northwest and, as Nielsen puts it, “could easily grow 80 percent this year.”

 

 

 

 

Obama innovation grants Obamapushiung states to move faster than they migut feel comfortable and some good going to come out of it…they asking for a lot of stuff and states tt win the awardzx will in fact do some changes in the spectrum of their schools that will on baance be positive…

 

 

Former Chairman, President & Chief Executive Officer,
Hazleton Laboratories Corporation
Former President, Seattle School Board

As head of Hazleton, which he turned into the largest independent contract laboratory in the world, Don Nielsen was troubled by the poor skills he often saw in his company's entry-level hires. When he retired in 1992, he decided to do something about it by running for the Seattle school board. "If you want to change public education," he says, "you have to get inside the system."

When he retired at 54, Don Nielsen did something perhaps unexpected of the CEO of the world's largest independent biomedical research and testing company. He set off on a two-year "odyssey" around the United States to try to figure out what was wrong with this country's public education system. Then he ran for the school board in his hometown of Seattle to see if he could be part of the solution.

These interests seem anything but dichotomous to Nielsen, whose passionate interest in education extends back to 1969, when he and his business partner, Kirby Cramer (68th AMP, 1974), were looking to purchase their first company. "The two areas of society I thought were broken were education and medicine," Nielsen recalls. "But education seemed too big a nut to crack."

 

 

Jon Eliassen, seven years after “retirement,” finds himself in a more-than-fulltime “entrepreneurial encore” with the unusual challenge of having top leadership roles at two public companies, both headquartered in Spokane.

Eliassen serves as interim president and CEO of Red Lion Hotels Corp., a $165 million-revenue chain whose business he’s quickly learning, and is chair of Itron Inc., a $1.6 billion metering company that he’s watched mature over nearly three decades from infancy to global prominence in its industry.

Eliassen recalls that when he first took the reins at Red Lion in January he’d get the occasional comment “you don’t know anything about the hotel business.” He had two answers:  “I’ve been staying in hotels for 40 years,” and “I’ve hired good people, so I don’t have to know a lot.”

But it became clear, during an interview, that Eliassen has no timetable for finding a permanent CEO and that he has a good grasp of where he wants to take the company before any transition comes about.

“I don’t view this as a caretaker role and I don’t think of Red Lion as a turnaround situation,” he said. “What I am doing is building an executive team that can successfully run a much larger hotel business, and providing the direction for that to happen.”

Red Lion’s footprint is in the West, with its 43 hotels and motels, 31 of which are owned and 12 are franchises.

Eliassen figures there’s plenty of room for growth for a 50-year-old brand built by a hotel chain acquired in 2001 by what was then Spokane-based West Coast Hospitality Corp., which assumed the Red Lion name in 2003.

As an outsider in the industry, he’s particularly concerned about the trends he sees of downward pricing pressure and a continuous cutting back on overhead, a trend that he says is “not sustainable over the longterm” for the industry.

As elite hotels pinched in this recession are, as he puts it, “pressing down into our space,” it’s putting pressure on Red Lion. But Eliassen also sees that as opportunity “because of the things we can offer a franchisee of a struggling chain.”

“In cases where the franchise obligations have grown onerous, we can offer a temptation to look at our brand,” he added. In fact, he says he’s “very focused.” on franchise development as a key part of the company’s strategy.

It was also at the start of this year that Eliassen, 63, assumed the chairman’s role at Itron with the retirement of LeRoy Nosbaum, who had stepped down as CEO nine months earlier but remained as chair until the end of 2009.

Eliassen, who has been on Itron’s board since 1987, figures the new role won’t add a great deal of time pressure for him since he had already been lead director, meeting frequently with Nosbaum, then Malcolm Unsworth, who succeeded Nosbaum.

Although he is in the unusual situation of having watched Itron since its birth almost 30 years ago as a subsidiary of what was then the investor-owned Washington Water Power Co., now Avista Corp., he makes clear that he doesn’t want to be viewed as responsible for its success.

But he concedes it’s been fun watching “a great run for a company built on a concept that Wendell Satre (then WWP CEO) saw as a way to print bills and leave them at the doorstep to speed up cash flow and improve accuracy of meter reading information.”

That run has included, in the last decade under Nosbaum’s leadership, Itron’s growth into a global leader in providing electricity, heat, water and gas metering devices.

The growth was accompanied by a dramatic run-up in the company’s stock price during the decade, from $5 to about $105 per share, a trend that turned in the final quarter of 2008 when the price plunged to under $40 per share. It has rebounded this year into the $50-$60 range.

Like many whose roots are in Spokane, I own a few shares of both Red Lion and Itron. And I’ve known Eliassen since he took the reins at the old Spokane Area Economic Development Council in 2003, a few weeks after he retired from Avista, where he was senior vice president and CFO and had a 33-year career. We also both served on the national advisory board of the Washington State University College of Business.

In his spare time, Eliassen serves on the board of the Washington Technology Center, the Spokane Intercollegiate Technical and Research Institute (SIRTI), which is the state’s most prominent incubator facility, and is involved in angel investing with his Terrapin Capital Group.

In an interview last spring with the Spokane Journal of Business, Eliassen offered a clue to how long he plans to continue this phase of his “retirement,” saying he wants to remain active for the next six to eight years with companies and their boards.

In the short term, he’s clearly intent on continuing with a dual role that has become increasingly unusual as pressures on CEOs have increased dramatically and their boards have become increasingly reluctant to have them divide their time with board-chair duties at other public companies.

 

David Allen, executive vice president of McKinstry, a Seattle company that has arguably become the nation’s most visible energy-services firm, says conservation needs to be seen by lawmakers and policymakers as equally important to innovation in reducing the nation’s carbon footprint.

The thing that concerns Allen is that “all the good things coming, like large-scale wind and solar energy, electric cars and all the benefits they’ll deliver won’t happen in our generation. There needs to be a better focus on what we can do now.”

In fact, Allen likens the pursuit of investing in renewable energy and clean-tech ideas as “a little like the dot-com era when money was spent on every possible tech concept, whereas only a few proved worth the investments.”

It was the message about treating conservation as equal to innovation in the quest for energy savings that Allen delivered late last month at a White House Clean Energy Forum at which he served on one of three panels.

“My role on the panel was to focus on how things like scale, financing and innovation are being deployed in practice, as well as looking at the challenges and opportunities.” Allen said. “The primary challenge is getting conservation treated as a renewable energy source, which would give it equal footing in things like investment tax credit and production tax credits.”

Allen, his brother Dean (McKinstry’s CEO) and their executive team have helped guide the company their father founded 50 years ago as a mechanical engineering business into a national leadership role in designing, building and managing energy-efficient facilities.

McKinstry has grown into a business with about $450 million in annual revenues, with 1,600 employees in 17 cities, including new offices most recently in San Antonio, TX, and Orange County, CA.

The Allens find themselves in the interesting position of, on the one hand, being cautiously critical of the race to find clean-technology innovations while spending their own resources to incubate and accelerate companies involved with promising new-technology concepts.

In explaining that seeming inconsistency with their unique accelerator facility for promising companies, David Allen says: “We’re more focused on companies that are in and around energy efficiency and clean energy, what we call NOW technologies, things that are ready to be implemented now.”

While he’s careful to come across as cautionary rather than critical, In a sense, the mantra of the McKinstry folks is that advocates of a greener, cleaner society are lured by thoughts of what might be while overlooking the opportunity to help bring about what can be.

None of his cautious criticism of spending on clean-energy concepts should be seen as McKinstry trying to generate more activity for its conservation business. Allen, in fact, sums up McKinstry’s business as “right now our shadow is bigger than our body.”

Allen, in explaining that comment, said: “We think the opportunity for energy-saving with conservation is such a huge one that there would be 100 McKinstrys, or we could be 100 times bigger, to meet the demand.”

Ash Awad, McKinstry’s vice president of Energy and Facility Solutions, who sat in on the interview with David Allen, noted that “70 percent of all power is used in buildings and half of that energy is wasted. Imagine if we could bring half the energy back to America.”

The McKinstry effort is two-fold:  to have energy conservation costs treated equally with alternative-energy technology and to create financial incentives for utilities to reduce their kilowatt hours.

“States are making rules about the percentage of renewable energy utilities must produce without realizing that there aren’t enough ways for the utilities to meet those requirements,” Allen said.

“Conservation needs to be treated like other renewable energy sources so that conservation initiatives could be eligible for all the grants and funding that are available for renewables,” he added.

“We’re convinced that one of the changes that has to happen is that utilities be allowed to make a profit from reducing their energy use rather than just requiring them to invest in new technology,” Allen suggested.

 

 

The global and national outcry at the firing-squad execution this summer of Ronnie Lee Gardner in Utah, the last state where that form of capital punishment is possible, could presage a similar uproar directed at Washington State should the nation’s last gallows be prepared for use. Eight men on death row in Walla Walla await that possibility.

But at least some of the anger seemed focused on the fact Utah still has an “Old West” way of executing its condemned criminals, who are able to choose the firing squad over lethal injection.

Since Washington is the last state where a condemned man may choose to die by hanging, it’s pretty clear that the same sort of charge of “barbaric Old West justice” could rain down on the state should the day come for one of those eight men.

Thoughts about Gardner’s execution and an interview with a Seattle area student doing a paper on capital punishment brought back memories of the 1963 hanging of Joseph Chester Self, which I covered for United Press International as a young reporter. Self’s would be the last hanging in Washington State for more than 30 years.

The state doesn’t have a gallows in the Old West style, but rather a large room at the Washington State Penitentiary in Walla Walla, a “death chamber” awaiting possible use should any condemned man choose to hang rather than receive a lethal injection.

Only men have been executed in Washington and of the 14 who have gone to their deaths since 1949, 13 were Caucasian and one was Hispanic. Two of the last four men to suffer the death penalty chose hanging, the last being Charles Campbell in 1995.

Washington’s governors have routinely passed on the opportunities over the years to interfere with the death penalty being carried out.

Mike Lowry, who was then in his first year as Washington governor, was the last to weigh whether to permit a condemned man to hang, although two men were subsequently executed by lethal injection during Gary Locke’s time as governor.

I asked Lowry to recall that hanging and his thoughts about it. In the process of answering, he disclosed that a personal visit with the condemned man at the state penitentiary had been part of what he referred to as “the considerable time” he spent reviewing Charles Campbell’s case.

“I received delegations from opponents of capital punishment and, of course, from family and friends of the people he murdered,” Lowry recalled. “In the end, I could not justify in my own mind reversing the 13-year legal process that included all the appeals that were made by his defense lawyers exercising his constitutional rights.

“One of the reasons I did not commute Mr. Campbell's sentence to life without possibility of parole is that there was a very legitimate fear that he might try to kill a prison employee or other inmate,” Lowry added.

Lowry conceded it’s possible there will be other executions in Washington State, noting:  “I feel for whoever is governor at that time and I hope he or she will explore every opportunity to find a solid justification to commute the sentence to life without possibility of parole.”

The case of Joe Self was different. When he made the short walk from his death-row holding cell to the door of the chamber, he had long-since converted to Catholicism and he had willed his eyes to an eye bank.

Self was convicted and sentenced to die for shooting a cab driver to death in a $15 robbery, the final criminal chapter in a life of otherwise petty crimes.

Spenser, the young man who contacted me for the interview for his project, told me he and a friend had decided to do a paper on the death penalty and had searched the Internet but found “mostly factual, neutral stuff. It was difficult to find sites that gave us opinions.”

I shared with him the details of the June evening of 1963 when two other young journalists and I were among the group of about 35 people on hand for Self’s hanging, by tradition just past midnight, “the first minute of the new day.”

Self, Warden Bobbie Rhay, a catholic priest who had become Self’s regular death-row visitor, and a couple of guards entered a door to the cement balcony against the back wall of the chamber, with the witnesses looking up from below. They walked to the center of the platform and stopped as Self stood above the steel door through which he would fall to his death when the door was sprung open.

Rhay asked Self if he had any final words and the condemned man replied: “Ask me if I’ve said my prayers, warden.”

With that, a hood was pulled over Self’s head. A straightjacket pinned his arms to his body. Rhay flipped a wall switch, signaling three men in a room below the death chamber that they should each flip the switches in front of them. Only one of the switches activated the trap door, through which Self fell in a moment, his neck snapping before onlookers could even grasp what they had witnessed.

That only three young reporters, all print journalists in their early ‘20s, were on hand (no radio or television news people and no seasoned reporters) to cover the execution was a commentary on the relative importance of a hanging then, though there was certainly media coverage in the weeks prior. After all, hangings occurred on average about once a year. But Self’s would be the last for decades.

The U.S. Supreme Court ruled Washington’s death penalty unconstitutional in 1972, but voters reinstated it, addressing the court’s concerns, in 1975.

By the time 30 years after Self that another death row inmate was to be hanged, the attention was widespread and went on for weeks, and all three of us who had been at Self’s execution found ourselves being interviewed by various media on “what it was like.”

Coincidentally, a week after Gardner’s execution, I got a card from Spenser that said: “Thank you for the interview. I got an A on my project.”

 

 

 

 

 

Kris Nielsen, whose Pegasus-Global Holdings Inc. has a client list that reads like the who’s who of the power and oil and gas industries internationally, predicts that the disastrous Gulf of Mexico spill will be the oil and gas industry’s Three Mile Island.

And because of the role Nielsen, chairman and president of the firm, and Patricia Galloway, his wife and the company’s CEO, play in guiding long-term strategy for an array of industries, it’s a prediction that’s likely to gather increasing attention as the Gulf disaster unfolds.

“With the recent BP disaster, the oil and gas industry will be forever changed, much as the nuclear power industry was 30 years ago,” suggests Nielsen, whose long career has brought him an international reputation as a risk-management expert.

Nielsen and Galloway come by the Three Mile Island allusion through experience with nuclear power, both in the ‘80s as the TMI aftermath washed over the industry, and now as the industry has finally come back. 

They were hired to try to save the Washington Public Power Supply System(WPPSS), a combine of public and private power entities created to build five nuclear plants, from the eventual collapse that became the largest municipal bond default in U.S. history.

And they continue to consult with power companies on nuclear energy, having worked with Florida Power & Light on nuclear plants and with Georgia Power on the first two Vogtle nuclear plants and are involved with two others that will be among the first new  plants since TMI.

It was during a London “road show” for long-time client Deutsche Bank in the weeks after the Gulf drilling disaster that Nielsen first likened the Deepwater Horizon catastrophe’s fallout to Three Mile Island. Deutsche Bank had asked Nielsen and Galloway to discuss the oil spill and its implications for BP investors in particular.

Until now, their comments have been highly visible and sought after mainly for those in the industries to which they provide guidance and counsel, but pretty much off the radar screen of the general public and the mainstream media.

However, as the Gulf spill’s long-term implications for the oil and gas industry, and for the fortunes of the company responsible, begin to sink in, their visibility may ratchet up exponentially.

Of late, they have been on a two-hour video conference from their company’s unusual rural headquarters each Monday morning with Deutsche Bank executives regarding Nielsen’s and Galloway’s ongoing assessment of the impact of the nation’s worst environmental disaster on the industry, and on the outlook for BP.

It’s a seemingly unlikely company headquarters from which they offer guidance and counsel to major companies around the world, write articles for key industry journals and organize conferences and prepare for speaking appearances.

The western-style log-faced building hard against the base of a treed hillside at the end of a long, dusty road a dozen miles east of Cle Elum, WA, officially replaced their former headquarters near Princeton, NJ, in 2007, although they’ve basically operated out of the Seattle area most of the past decade.

It’s from there on their Unionville Ranch, named for the New Jersey winery they founded and own, that Nielsen and Galloway communicate by phone, e-mail and videoconference with leading executives when they’re not on a plane to somewhere for face-to-face visits. The location is further evidence that entrepreneurs can work where they want to live.

When I asked Nielsen specifically about what he thinks lies ahead for BP, he replied that a  break-up of the company was possible, but would be an extreme outcome.

In a recent newsletter, Nielsen said the regulatory impact, which he predicted “will slowly spread throughout the world,” will impact all areas of the industry, “including the oil and gas services sector, not just domestically but internationally as well.”

But he added that “the oil and gas industry and the U.S. government now have a unique opportunity to ‘get it right’ and getting it right means looking at past disasters and determining how we short circuit idiocy and blend reasonable regulation with reasonable responses from the industry.”

Galloway joined the firm three years after her graduation from Purdue with honors and an engineering degree in 1978, soon became a shareholder, and recalls arriving in Seattle for the first time to prepare for her work with WPPSS and thinking, “so why don’t I live here?” They soon did, buying a condo in Seattle in 1987, the year they were married.

Nielsen and Galloway offer a note of optimism in suggesting that industry and government, by applying the lessons of Three Mile Island to dealing with the oil and gas industry, “should be able to shorten the timeline to regulatory and behavioral excellence from 30 years to 10 years.”

For this to happen, an earnest effort on the part of government to avoid over-regulation must be matched by an earnest effort by the private sector to pursue safety, “not as a result of government regulation but as a by-product of corporate culture,” they suggest.

“In the next decade, the oil & gas industry and companies will become good corporate citizens instead of the pariahs that they are perceived as being today—exactly as the nuclear power utilities have become 30 years after TMI,” Nielsen wrote in his newsletter.

 

 

 

 

 

 

 

 

Carol Vipperman, whose organization has championed economic ties with Russia since before the breakup of the old Sovet Union, thinks the Russian-spy flap could turn out to enhance rather than diminish relations between the U.S. and its one-time super-power enemy.

“The leaders of both nations, in moving quickly to resolve this, are saying our relationships are far more important than these kinds of distractions,” said Vipperman, president of the Seattle-based Foundation for Russian-American Economic Cooperation (FRAEC).

Her comments related to the swap of a group of Russian spies for four people held in Russia as spies for the West, an exchange that occurred last week in what one official described as being done “with electrifying speed,” having moved from disclosure to spy- swap in less than two weeks

Vipperman’s comments were among reactions over the spy caper from several in the Seattle business community, which was arguably at the forefront of initiatives in this country to seek close economic ties with Russia as the old Soviet Union began to break apart.

 “The readiness of both sides to make this swap happen quickly is a clear indication that our increased cooperation and newly ‘reset’ relationship is a priority,” said Vipperman. But she conceded that “there are always going to be some people in our society who will point to things like this and use them to suggest Russia hasn’t really changed since the old days.”

The organization Vipperman founded 21 years ago has weatheredan array of political strains over the years as it has pursued its relationship-building programs designed to foster economic ties between the two nations, particularly between the Pacific Northwest and the Russian Far East.

FRAEC was born out of a series of Seattle and Washington State initiatives, leading up to and flowing out of the 1990 Goodwill Games in Seattle, to reach out to what was then the Soviet Union.

In a blog she does for FRAEC, Vipperman wrote: “Although the Russian spy story has made for interesting and tantalizing media coverage, it has unfortunately stirred up old, cold war feelings of mistrust and suspicion. It is well understood by most Americans that all countries have intelligence services active around the world; however, it seems that Russia holds a very special place in people’s minds.”

Bill Robinson, a Seattle attorney with extensive business activity in Moscow, also noted that “this sort of thing has been done by both countries, and many other countries, for years but usually now as industrial espionage.”

“The fact that its resolution was handled so quickly shows that both nations wanted to make it clear it’s time to move on from this sort of thing,” Robinson added.

Douglas Jewett, one-time Seattle City attorney who was in the forefront of developing business opportunities in the Russian Far East, e-mailed me that “people practicing spy craft like this is the 1950’s and 60’s makes no sense to me.”

“What everyone in the business and government world is worried about, and they should be, is the capture of critical computer information through the internet,” said Jewett,

who for the past dozen years has been CEO of Bellevue-based Ramgen Power Systems, Inc.

Noting in her blog that the spy flap “has been a bit frustrating for those of us who work to strengthen our economic and community ties,” Vipperman added “there are far more interesting and compelling stories of how Russians and Americans are working together to improve our communities that do not see the light of day in the media.”

Among the kinds of activities Vipperman is referring to is the relationship between cities in Washington State and the Russian Far East in which the cities, under a program funded by U.S. A.I.D., provide training and resources to officials in the Russian cities.

Leavenworth, the Eastern Washington community in the shadow of the North Cascades that turned its fortunes around years ago by adopting a Bavarian theme, is working with Kamchatka on how to promote tourism, she noted.

Yuri Mamchur, who does a Russia blog for the Seattle think tank, Discovery Institute, did one in the midst of the  spy flap titled “Thanks a lot, Kremlin,” that criticized the spy plan as “not good pr” while poking fun at the whole issue.

“This is all hilarious,” wrote Mamchur, director of Discovery Institute’s Real Russia Project. “I’m loving all the coverage of a bunch of Russians getting paid to befriend Americans. I wish the U.S. had a program like this, I’d totally do this. Can you imagine? I’d get my rent and tuition paid just to blurt out stuff that you can automatically look up, even in more depth, on the Internet.”

 

Liz Marchi, who guides the Montana Angel Network, hopes to create an awareness on the part of promising entrepreneurs seeking capital that angels are gathering in increasing numbers and quality under the Big Sky.

Marchi, whose primary role is overseeing the Frontier Angel Fund in Kalispell, is helping to launch the third angel-investor group since assuming oversight of the angel network in the state that she adopted sight unseen a decade ago.  She is convinced that nurturing angel-investor support for innovative companies will lure entrepreneurs to create companies in Montana and thus grow the state’s economy.

The July 17 kick-off meeting of the Missoula-based Big Sky Angels group will involve presentations by two companies seeking funds. One is a Ventura, CA, company called Stewart Brown that was incorporated in Montana nine years ago and is now looking to return, which she views as an example of angel support that can lure companies to, or back to, the state.

Montana’s entrepreneur image was dramatically enhanced in May when the U.S. Chamber of Commerce issued a report that ranked the state first in the nation for entrepreneurship and innovation. That’s a ranking that can be misleading, since not all those described as entrepreneurs create businesses that create jobs.

But there’s nothing misleading about the fact the state is home to one of the nation’s most successful entrepreneurs and summer home to the man who may be the nation’s best-known angel investor.

Rob Ryan, who made his fortune taking several companies public, operates Entrepreneur America on his Roaring Ryan Ranch just south of Hamilton. He mentors, one at a time, a handful of the most-promising entrepreneurial companies that seek his help. And Bill Payne, who is one of the investors in Marchi’s fund and summers in Montana, has been described as the closest thing to a national entrepreneur laureate.

Marchi, who had already built a reputation as a successful business-development executive by creating and leading the Kalispell-based Montana West Economic Development organization after arriving here in 2000, decided in 2006 to launch the Frontier Angel Fund.

She admits she didn’t know what the outcome would be when she put together a pooled fund with $50,000 units, but by the end of that year she had almost three dozen members with residents of five states in addition to Montana involved. She raised $1.8 million, about $300,000 more than the working capital she had hoped for.

The Missoula angels’ launch meeting in a few days will also host a visit with Bill Payne, freshly returned from a stint in New Zealand, where he was invited to be entrepreneur in residence at the University of Auckland.

Dr. David Opitz, a homegrown entrepreneur who founded and grew Missoula-based Visual Learning Systems before selling it to Textron, has been tapped to lead the Missoula angel group.

Marchi describes Opitz as “a terrific entrepreneur who understands how to navigate the academic world as well as how to build a successful business. He will be a great collaborator for the new tech transfer efforts in process at the University of Montana.”

Marchi emphasizes that the Missoula group “will need to build its own culture.” But she adds “I think of its future as including angels who may not even live here but are maybe alumni of the University of Montana and very much want their money to be involved in new business endeavors in Missoula.”

That would not be unlike the makeup of her Frontier Angels group, which she says includes “five doctors, a veterinarian, three attorneys and at least four people who were once either CEOs or CFOs of Fortune 500 companies.” Members of the fund hail from California, Georgia, Vermont and Nevada, in addition to Montana.

Montana’s third angel group is the Bozeman-based Bridger Private Capital Network, a group of accredited angel investors formed about the same time as Marchi’s Frontier angel group.  But, unlike Frontier, it doesn’t function as a fund in which members pool their capital. Rather it describes itself as “Montana’s largest angel investor network.”

Marchi has roots in the intermountain area, having grown up on a ranch near Jackson Hole, in Wyoming.  But she traveled far, both in distance and “time,” when she left her job as executive director of communications and public policy for the Winston-Salem, N.C., chamber of commerce and moved with her then-husband and three children to Montana, a place she’d never been before.

“It was like going back in time,” says Marchi. “It was 2000, but it looked like the 1950s. The infrastructure was here but the state was languishing. There wasn’t a bank president who was using e-mail at the time.

“But technology has completely transformed this place,” she enthuses. “And the shared values are incredible. You’d never know if someone had a million dollars in their pickup.

“The quality of people who are doing things here proves that there’s no penalty for being in paradise.”

 

 

 

 

 

 

 

 

 

 

William D. Ruckelshaus, who has spent most of his life helping create, enforce or promote environmental laws and regulations, says government is obliged to step in on occasion, and probably spend more money, in helping to protect against cataclysmic disasters like the Gulf of Mexico oil spill.

Ruckelshaus, twice director of the Environmental Protection Agency, says “society must decide how big the risk of such disasters is and what we need to spend to protect against them. That’s what a regulatory system is about.”

Referring to BP’s preparation for a disaster like the Deepwater Horizon spill, Ruckelshaus said: “There’s no question that risk being weighed by the company was that nothing like this would come along. There’s also no question that if they had anticipated the possibility of anything like this happening, they would have spent a lot more time and money.”

“If they had gone last mile, it would have cost a $1 million a week,” Ruckelshaus estimates. “Think how much they could have saved had they planned for the worst.”

Ruckelshaus, who was chosen in the fall of 1970 by then-President Richard Nixon to be the first EPA administrator, noted in a telephone interview that 40-years-ago appointment had an amusing twist.

Ruckelshaus, now strategic director with Madrona Venture Group in Seattle, recalled with a chuckle that a friend of his had suggested to a Newsweek reporter that Ruckelshaus would be a good selection to head the planned new agency.

“When I read that, I went to (Attorney General) John Mitchell, since I was with the Justice Department at the time, and told him I hadn’t initiated that story,” Ruckelshaus remembered. “I thought that was the end of it. But a little while later, Mitchell called me and asked me if I wanted the job.”

So on December 1, 1970, Ruckelshaus assumed the reins of a new agency that had come into existence as part of an executive order from Nixon. The National Oceanographic and Atmospheric Administration (NOAH) was created by that same order.

Ruckelshaus recalled in an Earth Day 40^th anniversary piece in April this year in the Wall Street Journal that he quickly brought enforcement actions against three large cities for violating the Clean Water Act. That was followed by actions against the steel industry and other industrial polluters.

Ruckelshaus explained in the WSJ piece that “I knew that the job of the EPA would be far more contentious in the future if we didn't establish its credibility and its willingness to take forceful—and symbolic—action right from the start. The American people had to know we were serious about meeting their demands.”

Ruckelshaus noted that Nixon signed 16 major pieces of environmental legislation into law during his presidency. To the possible surprise of many, Nixon had initiated most all of them, but Ruckelshaus noted that Nixon’s environmental proposals nonetheless brought him into conflict with a Democrat-controlled Congress.

“Nixon would submit what he thought was good legislation on either clean air or clean water and the Democratic Congress would put in more extreme provisions than Nixon liked,” Ruckelshaus said. “That’s where the political overtones came in because what bothered Nixon was that no matter what he submitted on environmental issues, Congress took it further than he intended. So towards the end, Nixon was quite down on environmental legislation.”

Ruckelshaus returned to head the EPA in 1983 under Ronald Reagan after it became clear the agency’s image needed repair.

In all, Ruckelshaus has spent nearly a half century on behalf of environmental causes, from the time he was a 28-year-old assistant attorney general in Indiana when he obtained court orders against industries polluting the water supply and helped draft the 1961 Indiana Air Pollution Control Act.

Those involvements on behalf of the environment are way too numerous to begin listing, other than to say they continue today with his involvement with the Puget Sound Partnership and its clean-up Puget Sound initiative.

So it’s logical that his input would be of value as the nation grapples with what process to put in place to help reduce future risks of calamities like the BP spill.

“You can never eliminate the risk of these things happening, but there are steps that reasonably should be required to come as close as possible to eliminating them,” he said.

“The problem any society has in avoiding cataclysmic risk is that it is very hard to balance how much money should be spent to minimize the risk,” he said. “If you leave the problem of minimizing the risk just to the company involved, they’ll try to minimize the risk of the cataclysm occurring. So government has to step in on occasion and say we need to spend more to guard against this.”