Daily Business Report-Oct. 25, 2018
Former Art Institute student Jana Bergevin filed a complaint about the school with California’s Bureau for Private Postsecondary Education, but her case languished for more than two years. (Photo by James Bernal for CALmatters)
The long odds of enforcement
for California’s for-profit colleges
By Dan Morain | CALmatters
If for-profit colleges should expect regulation anywhere, it’s California. The state’s last two attorneys general have litigated aggressively against Orange County-based Corinthian Colleges and others where vulnerable students have ended up with huge student loans and dubious degrees.
But enforcement has lagged badly at the state bureau that is supposed be California’s for-profit watchdog, reports CALmatters’ Felicia Mello, even as Obama-era crackdowns on for-profit college fraud have eased under the Trump administration.
A backlog of almost 1,200 complaints has stretched cases to a year and a half on average at the state Bureau for Private Postsecondary Education, and some investigations are taking three years or longer, Mello writes.
Margaret Reiter, consumer attorney and vice-chair of the BPPE’s own advisory committee: “The bureau should be the first line of defense. It should be catching these frauds early on. I don’t see that that is happening.”
Jana Bergevin, a former student who waited two years, in vain, for the BPPE to act after she complained that The Art Institute of San Francisco left her with two worthless degrees and $114,000 in student loan debt: “If it’s not your jurisdiction to protect California students from fraud, then why are you here?”
Click here to read Felicia Mello’s full report.
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Business Outlook Index
44 percent of businesses oppose
proposed Proposition 13 reform
The Business Outlook Index remains comfortably in positive territory at 18.9, in this month’s San Diego County Business Forecast of the San Diego Regional Chamber of Commerce. This month’s Forecast also delves into Proposition 13 and the potential reform measure that would remove the caps on commercial property taxes paid by companies with 50 or more employees. The survey finds that 57 percent of the regional business community views Prop. 13 as at least somewhat important to businesses like theirs. The proposed reform of Prop. 13 is opposed by 44 percent of businesses and a sizeable 33 percent of that is strong opposition, while only 28 percent in the county are in support.
“Our business community is right to be wary of the Prop. 13 reform effort,” said Jerry Sanders, president and CEO of the San Diego Regional Chamber. “Whether you are directly affected by the tax increase or not, the cost increases would likely be passed to tenants and consumers. Worse, businesses would move out of the state, reduce employment, or close operations entirely.”
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General Atomics gets $193 million
Army UAS logistics services contract
GovCon Wire
General Atomics’ aeronautical systems business has received a $192.7 million contract modification to provide logistics services for the U.S. Army’s Gray Eagle unmanned aerial system.
Army Contracting Command will obligate $41.8 million at the time of award from the service branch’s fiscal 2019 operations and maintenance funds, the Defense Department said.
Work under the modification will take place in Poway through April 23, 2019.
Gray Eagle UAS is based on the Predator unmanned aircraft and designed to support attack, reconnaissance, surveillance and target acquisition missions.
General Atomics developed the aircraft to operate at an altitude of up to 29,000 feet and carry more than 1,000 pounds of payload such as Hellfire missiles, a synthetic aperture radar, electro-optical/infrared sensors with laser designation and communications relay technology.
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Seaport developer, fishermen reach deal
to save San Diego’s storied fishing industry
After years of negotiations, San Diego’s fishermen and a local developer have signed an agreement to recapture a lost piece of the city’s history – a thriving commercial fishing trade that once employed thousands of people while netting hundreds of millions of dollars.
Much of the agreement focuses on five acres called Tuna Harbor, and the role it will play within Seaport San Diego, the billion-dollar waterfront development expected to break ground in 2022.
Click here to read the full report by Brad Racino/inewsource
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Neighborhood Bancorp completes
$2.9 million capital raise
Neighborhood Bancorp announced it has completed a capital raise of $2.9 million that was oversubscribed among directors, officers and existing shareholders, along with a significant investment by an experienced local community bank investor. The capital was raised without the assistance of any investment bankers and was done at nominal costs to Neighborhood Bancorp for a stock valuation assessment only, according to officials.
“We were able to quickly raise $2.9 million, including a significant investment from a well-known local community bank investor,” said Steve Taylor, chairman of the board. “This additional capital will be used to provide growth capital as the bank seeks to improve its financial performance under newly appointed president & CEO, Scott Andrews.”
Neighborhood Bancorp is the holding company for Neighborhood National Bank, which has two branches in San Diego and El Cajon.
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Cubic wins ‘Best Business App’
from Mobile Breakthrough Awards
Cubic Corporation’s Cubic Transportation Systems division has been awarded the “Business App of the Year Award” for its Cubic Mobile Suite, developed for personal mobility, retail merchants and transit agency inspectors. Hosted by Mobile Breakthrough Awards, the Business App Award is one of several categories recognizing the top companies, products, innovation and people in the mobile and wireless industries today.
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Cubic to acquire Advanced Traffic Solutions
Cubic Corporation announced that it has entered into an agreement to acquire Advanced Traffic Solutions Inc., a provider of intelligent traffic solutions for the transportation industry, for approximately $235.7 million in cash, subject to customary adjustments. Based in Sugar Land, Texas, Advanced Traffic Solutions provides a fully integrated, innovative suite of software, Internet of Things (IoT) devices and hardware solutions that provide customers with enhanced mobility and improved safety. It will be integrated into the Cubic Transportation Systems business unit.
In fiscal year 2019, Advanced Traffic Solutions is expected to contribute approximately $50 million in sales.
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San Diegan Phil Pryde named the
2018 National Cox Conserves Hero
Cox Enterprises, parent company of Cox Communications, and The Trust for Public Land have named Phil Pryde, professor emeritus at San Diego State University, the 2018 National Cox Conserves Hero.
As the winner of this award, Pryde’s nonprofit beneficiary of choice, The San Diego River Park Foundation, will receive $50,000. This is in addition to the $10,000 already awarded to the environmental nonprofit when Pryde was named the California Cox Conserves Hero earlier this year. Pryde won this national award through a public voting process among eight nominees from across the United States conducted on coxconservesheroes.com between Oct. 1–15, 2018. This year was also the first time a national winner was named.
Pryde taught courses in environmental policy, land use planning, and environmental impact analysis for 32 years at SDSU, has also been involved with local conservation groups for 48 years. He currently serves on the board of directors for The San Diego River Park Foundation and the Anza-Borrego Foundation. The San Diego River Park Foundation nominated Pryde for the 2018 award.
“I’m truly honored to accept this award,” said Pryde. “The San Diego River is an important part of the community here and you may be sure I’ll continue to help protect it.
The Cox Conserves Heroes program is celebrating 10 years of recognizing community members who work tirelessly to create, preserve or enhance outdoor spaces.
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Bank of America awards $267,500
in grants to San Diego-area nonprofits
Bank of America announced $267,500 in economic development grants to be distributed to19 nonprofits that help stimulate local business and neighborhood stability. Nonprofits receiving the funds provide services ranging from affordable housing and community development resources to small business support, access to arts and culture opportunities, and environmental sustainability.
A new report from the California Housing Partnership notes San Diego needs 143,800 more affordable rental homes to meet the current demand. The report also notes that San Diegan’s lowest-income renters spend 69 percent of their income on rent leaving little remaining for essentials.
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Otay Water District executes
Successful bond sale
The Otay Water District executed a successful bond sale that is expected to close on or about Nov. 1. The water revenue bond will fund $28 million of the district’s capital projects during the next three years and will refinance $6.9 million of the district’s 1996 Variable Rate Demand Certificates of Participation (COPs) to a fixed rate of interest. By refinancing its 1996 Variable Rate COPs to a fixed rate, the district has eliminated the risk of increasing costs for customers due to rising interest rates.
Standard & Poor’s Global Ratings reaffirmed the District’s AA credit rating based on S&P’s independent assessment of the district’s overall capacity to meet its financial obligations. The district’s current rating relates to the district’s water-service related side of its business.
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Personnel Announcements
J. Christopher Barry named CEO of NuVasive Inc.
NuVasive Inc., a San Diego leader in spine technology innovation, has named J. Christopher Barry to succeed Gregory T. Lucier as chief executive officer, effective Nov. 5. Barry will join the board of directors. Lucier will continue to serve as chairman of the board.
Barry brings to NuVasive extensive experience as an innovative global leader in the health care and medical device industry. Currently, he serves as senior vice president and president of Surgical Innovations, the second-largest business unit at Medtronic with $5.5 billion in annual revenue. In this role, Barry leads and provides strategic direction to more than 14,000 employees working in 78 countries, including 10 manufacturing sites and multiple R&D centers around the globe. He also is responsible for driving the core growth in Surgical Innovations while diversifying the business through acquisitions in near adjacencies and overseeing the development of Medtronic’s surgical robotics development initiative. He previously held commercial and leadership roles at Covidien.
