Nevada’s Energy Future

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Debbie Donaldson (L) moderates a panel discussion on the future of green energy with Dr. Patricia “Pat” Spearman, Nat Hodgen, and Jessie Murray.

By Craig A. Ruark

Just before the opening of early voting, energy experts and elected officials told a pair of forums that ballot Question 3 presents a rare opportunity for both consumers and the industry to stake out winning positions for the future.

Question 3 would authorize the Nevada Legislature to “minimize regulations on the Energy Market and eliminate legal energy monopolies.” If approved by voters, it would have to be voted on again in 2018 before it could be implemented in 2023.

On October 19th, the Nevada Energy Star Partners Green Alliance held a panel discussion titled “Nevada’s Energy Future.” Debbie Donaldson, publisher of the Las Vegas Business Press, asked panelists Dr. Patricia “Pat” Spearman, Nevada Senator District 1; Nat Hodgen, executive director of the Southern Nevada Home Builders; and Jessie Murray, director of renewable energy projects for NV Energy, to describe the current energy environment and what we need to do to prepare for the future.

The three speakers, though diverse in their backgrounds, were part of the “New Energy Industry Task Force” that was initiated by Gov. Brian Sandoval and worked toward solutions to grid modernization, carbon emissions, distributed generation and storage, and clean energy sources.

Based on the Task Force’s research and discussions, several recommendations have been sent to the governor for the 2017 legislative session. In addition, a plan for grandfathering residential rooftop solar customers (those who were on-line or had applied to be part of the solar program as of Dec. 31, 2015), was approved by Governor Sandoval. It will take effect in December 2016 and expire November 30, 2036.

Senator Spearman said she is planning several bills for presentation during the 2017 legislative session.

“The technologies that we have right now and those that which are on the horizon are changing, literally, in a nanosecond,” she said. “We don’t have legislative policies in place to address the question about [energy] storage adequately. Because we don’t have policies in place that address an integrated energy system that customers want to go to.”  Spearman supports modifying the electrical grid to include distributive generation including geothermal and wind energy, and advocated for ‘out of the box’ thinking to prepare us for energy possibilities that are unthought of at this time.

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Rose McKinney-James, (L) moderates a panel discussion on ballot initiative Question 3 with Adam Kramer, John Hanger, Gary Aksamit, and Quentin Abramo, president of Faciliteq, representing small business.

On Oct. 20, Clean Energy Project, a non-profit organization, drew more than 100 people to the Switch Innevation Center in Las Vegas for a lunchtime session. The panel discussion was moderated by Rose McKinney-James, lobbyist and managing principal of Energy Works LLC, and included panel experts on distributive energy generation.

The topic title: “How will ballot initiative Question 3 ensure that clean energy development has a place in a well-regulated open market; and how will a restructured market ensure that all customers have the opportunity to access clean energy to power their homes and businesses?”

Adam Kramer, executive vice president of strategy for Switch, worked with environmental and consumer advocacy groups to develop the “Yes on Question 3” stance, answered: “The genesis of Question 3 is to deliver low-cost renewable energy to all Nevadans. As we begin talking about the restructuring and creation of a well-regulated open market, it is important that we do this in a way that is cognizant of the importance of renewables as well as the protection of all ratepayers here in Nevada.”

Switch along with MGM and Wynn Resorts have received approval from the Public Utilities Commission and to leave NV Energy’s grid. The Las Vegas Sands Corp. also filed an exit application that was approved by the PUC, but the company opted not to go forward.

John Hanger, an energy consultant and former secretary of the Pennsylvania Department of Environmental Protection, described this initiative from his perspective is “A huge opportunity for clean energy, but it is also an opportunity for customers.”

Hanger cautioned that there are two important pieces that must be in place both for clean energy and for consumers to make “the power of choice” option work:

  1. You need to have a real-time market monitor — ‘the cop on the beat’ of the retail and wholesale energy market to protect consumers. “The recent changes at FERC [Federal Energy Regulatory Commission] are important, but you also need a local cop,” said Hanger
  2. On the demand side of the market, the cleanest energy source is energy efficiency so if you empower consumers with smart meters and thermostats to control their demand, it will help their pocketbook and will also help the air quality and the environment.

Gary Aksamit, founder of Americans for Electricity Choice, offered a glimpse at what the market could look like after restructuring.

Using Texas as an example, Aksamit suggested that consumers check out www.TexasPowerToChoose.org, a clearinghouse database of all of the retail power providers in the state of Texas and competing for consumers. (Readers can put in the zip code 75094 to see how the site works.)

“Once into the website,” said Aksamit. “You are going to find between 150 and 250 offers for your business.”

The consumers in Texas have the opportunity to choose everything from 100 percent renewable energy to energy based on the lowest cost per kilowatt hour. Consumers are also able to lock in rates for whatever period they choose, with, of course, a penalty for early cancellation.

This type of open market program, according to Aksamit, allows the consumer to choose the type of power and the price point that fits their budget and lifestyle. The drawback to this program is with all the choices afforded to the consumers, not everyone is going to have the knowledge or want to take the time to wade through all of the options. In that case, many consumers may just accept what the local utility is offering and call it good.

The idea behind Question 3 is to offer choice to those consumers that want choice and to begin to prepare Nevada for a progressive energy future. That’s a planning process that Senator Spearman stated “must start now.”


LVCAC reports a positive outlook for Las Vegas

During a breakfast presentation to the Las Vegas chapter of the Hospitality Sales and Marketing Association International, Chris Meyer, vice president of global business sales for the Las Vegas Convention and Visitors Authority, had some encouraging words about the Las Vegas market.

Between 2000 and 2009, the number of rooms in Las Vegas increased from 125,000 to nearly 150,000. In 2016, Las Vegas lost about 1,300 rooms with the implosion of the Riviera, but saw construction activity at the Lucky Dragon, Resorts World and Alon.

“One of the things that we in Las Vegas do so well is maintain occupancy. Even during the dark days of the recession, the occupancy level never dropped below 80 percent,” Meyer said. Currently, the average occupancy hovers around 89 percent while the rest of the country is in the 60 to 70 percent range.

Contrary to the report on international activity by Roger Dow, president and CEO of the U.S. Travel Association during this meeting, “Our (Las Vegas) destination is exceeding all expectations,” Meyer said.

The latest figures for 2016 as of the end of July show that all numbers have increased over prior years:

■ Leisure visitation up 1.7 percent at 25.2 million

■ Convention attendance up 14.4 percent at 3.9 million

■ Occupancy up 1.7 percentage points at 89.8 percent

■ Revenue per available room (RevPAR) up 6.8 percent at $113

■ Gaming up 1.3 percent at $5.7 billion

■ Air traffic up 5.2 percent at 27.4 million

The two dominant numbers are the convention attendance, showing a double-digit increase year-over-year, and the RevPAR number, which is twice the national average.

One of the growth trends that will effect Las Vegas is not the number of hotel rooms but the increase in meeting space. Not including the expansion and renovation of the Las Vegas Convention Center, between now and 2019 resorts in Las Vegas have announced plans to build an additional 555,000 square feet of meeting and convention space.

In addition to promoting Las Vegas as a business and vacation destination, the research and statistics department at the LVCVA has more than 25 years of experience monitoring leisure and business trends according to age, gender, and ethnicity. Research shows that consumers are trading things for experiences. For instance, they are giving up ownership of an automobile in order to be able to afford to travel more.

The LVCVA is also engaging booking agents and travelers through social media. So far in 2016, the fans/followers have increased by 48 percent to 3 million; and videos about Las Vegas have increased by 175 percent to 79 million downloads. Part of the social media program involves reaching out internationally with 10 international social accounts reaching 310,000 users. The LVCVA has had 13.5 million engagements with international Facebook content and launched a WeChat account linking to the largest stand-alone messaging app in the world, serving 680 million active users, most of whom are in China.

The LVCVA has developed what it calls a “content forward trade show experience” that allows Las Vegas-based companies to access a web-based application that is constantly updated with the latest information about events, shows and sightseeing tours in and around Las Vegas. This application can be accessed through a computer or tablet to show customers at trade shows. It will debut Oct. 20.

Access to Las Vegas via air travel has significantly increased during the last 12 months with the addition of more and more direct flights both domestically and internationally.


U.S. travel industry stagnate but going in the right direction

About 80 marketing executives, many from the major Las Vegas casinos, met Sept. 29 to consider potential growth for and obstacles to the city’s ability to draw international tourism.

“The U.S. travel industry generates $2.1 trillion in economic output and supports 15 million jobs. Tourism is Southern Nevada’s No. 1 industry, supporting 368,900 jobs (41.4 percent of the workforce) and generating $51.8 billion in aggregate economic output.”

That was the opening statement of Roger Dow during a breakfast presentation to the Las Vegas chapter of the Hospitality Sales and Marketing Association International. Dow is the president and CEO of the U.S. Travel Association, an organization that represents all segments of travel in America.

“I keep saying that hospitality, lodging and the travel industry is the front door to economic development. No one ever decided to buy a second home or condo here (Las Vegas) until they first came here for a meeting, event or a vacation. Then they realize wow, pretty cool, lots to do, great restaurants, all these things,” Dow said.

In his talk, Dow outlined how international travel has improved for the hospitality industry and listed some hurdles to be overcome.

On the positive side was the improvement of visa wait times. In the past, the waiting period for a three-minute visa interview was 120 days. That has been shrunk to fewer than five days, and, as a result, the number of international visitors went from 53 million in 2009 to 77 million in 2015. That number is expected to climb to 100 million by 2021.

In addition to improving the visa wait times, the U.S. also expanded the number of countries enrolled in the Visa Waiver Program from 27 to 38. This program enables most citizens or nationals of participating countries to travel to the United States for tourism or business for stays of up to 90 days without first obtaining a visa when they meet all requirements.

One of the best examples is South Korea. When it was added to the Visa Waiver Program, visitation went up 46 percent in 18 months. An additional 400,000 South Koreans visited the U.S., making an average of 850,000 to 900,000 visitors each year.

One of the most important business and tourist countries in the world is China. In 2009, there were 500,000 Chinese visitors to the U.S. By 2015. that number was 2.2 million, and it is expected to grow to 5 or 6 million visitors each year. China is not one of the countries in the Visa Waiver Program, but the five-day visa processing program has helped to bring more tourists. In addition, a Memorandum of Understanding was signed with China to allow for 10-year business visas. This means that a Chinese businessman that comes to Las Vegas each year for the CES only needs to apply for a visa every 10 years, making it easier for China to do business in the U.S.

Recently, the Las Vegas Convention and Visitors Authority recognized how important the Chinese visitors will be to the lcoal economy and launched a campaign asking local businesses if they are “China ready.” The program talks about the need for improved signage, menus and guest relations personnel that speak Chinese languages.

Challenges that the travel industry faces include:

■ Infrastructure: This must grow to be able to move people throughout destinations. “The problem is the government keeps ‘kicking the can down the road,’ which stifles cities’ ability to grow and properly accommodate incoming travelers,” Dow said.

■ Ability to process people through airports: More travelers should utilize TSA precheck programs.

■ Customs and border protection: The U.S. needs to continue advancing technology including automated passport control and facial recognition.

■ Airplane capacity: In 2006, 11 airlines controlled 85 percent of air traffic in America. Now, there are four legacy carriers: Delta, American, United, and Southwest. “I want them to grow, but we can’t have four airlines controlling our destiny,” Dow said.

■ Improve load factors: Legacy carriers are projecting only 2 percent growth, yet international visitation is predicted to grow by 4 to 6 percent per year. The numbers don’t match, and carriers will stifle visitor growth.

■ Pandemics: The government and the media need to do a better job of identifying the exact areas affected by an epidemic and not make it sound like an entire state, region or country is affected.

The good news for the hotel industry is that, nationwide and in Las Vegas, the number of visitor days has not declined, but the amount of money spent during those stays has. Dow notes that “people are spending less on a hotel room. Instead of purchasing two Gucci bags, they are buying one. Instead of going to a 4-star restaurant, they are going 3-star.”

While nationwide the travel industry is flat, only growing at about 2 to 3 percent at this time, projections are for improved growth.

While business travel is very important to the economy, two-thirds of the travel and hospitality industry is for leisure activity.

One of the main reasons for the stagnated growth is the fact that Americans are not taking vacations. Americans have become what Dow calls “a nation of work martyrs.” In 2000, Americans took 23 days of vacation time. In 2015, that figure dropped to 16.2 days. Millennials, according to Dow, are the “worst offenders.” Because of the challenging work market, “they’re terrified of losing their jobs and want to look good.”

Furthermore, the USTA surveyed children, ages 6 and 7:

■ 75 percent say their parents never disconnect from the office when they come home.

■ 61 percent say the best time they spend with their parents is when they’re on vacation.

■ The surveyed children said, at least three days per week, their parents promised they would be home but were not.

To encourage Americans to take more leisure time, the travel and hospitality industries have teamed up to build a campaign called “Project Time Off,” producing a series of public service announcements touting the social and health benefits, physical and mental, of leisure activities.

MasterCard has committed $80 million to its television campaign where children ask their parents to take a vacation.


Life is Beautiful festival gets mixed reviews from downtown small businesses

 

 

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Las Vegas Container Park

 

When the “Life Is Beautiful” festival opened the gates at 2 p.m. Sept. 23 for its fourth annual three-day event, it was anticipated that nearly a year of planning would result in a huge economic boost to some of the downtown businesses.

The official numbers were not in as of press time. According to the Las Vegas Convention and Visitors Authority, however, the 2015 festival was a huge success for the community. Tallies show that there were 57,000 unique attendees for the event, and over the three-day period the total attendance amounted to 131,500. The direct economic result was a $21.5 million boost to the local economy.

“Over the past several years, music festivals have grown in popularity and have become a major draw among our numerous destination offerings,” said Cathy Tull, senior vice president of marketing for the Las Vegas Convention and Visitors Authority. “Life is Beautiful is one of many festivals that have decided to call Las Vegas home, and we look forward to welcoming all of the attendees to downtown Las Vegas.”

During the event, 18 city blocks are fenced off with 2.5 miles of perimeter fencing. “The event is very expensive to produce; we have to build the entire venue,” said Justin Weniger, a co-founder of the event. The venue includes three small stages and a very large main stage, a VIP lounge, culinary villages and art vendor booths.

Although the economic impact has been great over the past few years, the festival has seemed to fall out of favor with some downtown small business owners.

Marchello Tanasi, the owner of Vegas Flip Flop and Vegas Hot Rod and Street Wear stores in Downtown Container Park, did not have a positive experience during last year’s event. “Actually, I think that it catered mostly to the food. The retail side of it, and I can speak for a lot of people; we had no business.” This year, according to Tanasi, was a little better than last but nowhere near an average weekend.

Stella Pappas, the owner of Athena’s Jewelry Box, agreed with Tanasi. From her upstairs window, she could see the festival attendees dancing and partying in the street but did not see any traffic in her store.

Both Tanasi and Pappas, along with a few other shop owners, have asked their landlord, the Downtown Project, if they can close early or not open at all during the festival. Part of their contract with the Container Park required them to remain open during such events.

“People are here to party, they don’t want to be carrying shopping bags around,” commented another shop owner who wants to remain anonymous. “However, even though I did not have any business during the event, I do think that it brought awareness to the Container Park, and I hope that some of the people came back another time to see what we have.”

Kellie Kroplinski, the owner of Art Box, which carries handcrafted jewelry, clothing and art pieces from local artisans, had a better experience.

“I thought the festival was wonderful,” she said. She reported a 20 percent increase in sales and said she is encouraged by the fact that an increased number of locals who never had been to Container Park, visited her shop during the event.

Scott Wurth of San Miguel Collection in Container Park sells home-decorating items, dining, jewelry and other unusual artisan-crafted items. “Last year was pretty good for us during the festival. It was a little difficult because the festival-goers did not want to take things with them because they were busy, so we offered free shipping on everything for the entire event.”

When asked what sort of sales his store had, Wurth explained, “I am not sure that our store is exactly the Life Is Beautiful customer, so our sales stayed the same. We knew that we had to offer free shipping just to make some sales.”

Part of the problem was the fact that on a normal business day, Container Park opens its gates at 10 a.m. During the festival, the gates don’t open until 2 p.m., and only festival-goers who bought tickets are allowed to enter. To make matters worse, the shopping complex is virtually inaccessible for three days before the festival and three days after while crews barricade the streets to assemble and dismantle the stages and booths and other festival equipment.

During this year’s event, in addition to the 80 bands that performed, there were 44 food vendors from restaurants all around Las Vegas. The restaurants of Container Park, while open during the event, were not listed as part of the festival experience.

Co-founders of the event, Weniger and Ryan Doherty, met in 1999 while attending UNLV and have lived in downtown Las Vegas since graduation. In 2001, the pair started WENDO (a combination of their two last names) Media Cos., and in 2006 began publishing Vegas Seven magazine to spotlight the food, entertainment and art culture in Las Vegas.

Weniger and Doherty also opened two bars on East Fremont Street called Commonwealth and Park on Fremont. “Both are designed to be real-life neighborhood community bars,” Doherty said. Their frustrations in trying to entice customers to cross Las Vegas Boulevard, to a somewhat less-desirable neighborhood, turned into the idea behind Life Is Beautiful.

“The inspiration stemmed from the idea that if we combined art, music and culinary together that it would drive the community around the idea of revitalizing downtown, and at the same time build art, culture and community,” Weniger said.

The partners teamed up with Tony Hsieh, who owns Downtown Project, to form Life Is Beautiful LLC. Hsieh has for the past few years been acquiring property along East Fremont Street and several blocks to the north and south. This area is the site for the Life Is Beautiful festival. Downtown Project also owns Container Park at 7th and Fremont streets.

Tickets for the event started at around $125 for single-day general admission and $285 for all three days. VIP tickets start at $655 for the three days and as much as $15,000 for a package that included 10 VIP passes, a bucket of beer, two bottles of hard liquor, a dedicated concierge and cocktail server, private viewing areas and shaded relaxation areas with flushable restrooms among other perks.

Both Life Is Beautiful and the iHeart Radio Music Festival, which was held Sept. 24 and 25, were competing for music lovers. iHeart reported a sellout of 15,000-seats at T-Mobile Arena and a capacity crowd of 25,000 for Saturday’s daytime festival at Las Vegas Village.

Weniger and Doherty are hoping to increase attendance by 40 percent this year. “Early numbers show that occupancy was up in Downtown Las Vegas and spilling over to the Las Vegas Strip,” said Weniger.


Asian Influence and Population Growth Brings Economic Benefit to Vegas Valley

 

Anyone who has lived in Las Vegas more than 30 years has seen a lot of changes, not only along the tourist corridors of the Las Vegas Strip and Downtown’s Glitter Gulch, but the neighborhoods and side streets as well.

Spring Mountain Road, which starts at Las Vegas Boulevard and heads west to Hualapai Way, is one of those major streets that has seen dramatic change visually and culturally.

Now, distinguished by its Asian-themed restaurants, grocery stores, shops and medical practices, it is hard to picture Spring Mountain’s early days as a semi-industrial blend of warehouse buildings with storefronts and vast sections of desert.

The August opening of the $1 million Chubby Cattle restaurant at the corner of Spring Mountain and Jones Boulevard is one of the high-water marks for the road. Owner Harby Yang spared no expense when designing the 3,600-square-foot space, complete with a waterfall, custom designed 3-D recessed sky ceiling, custom-made, hand-cut tables with induction cookers and seating for 160 guests.

By recruiting Master Chef Mr. Ho, former corporate chef for Little Lamb International, Chubby Cattle also adds to the list of distinguished chefs that now call Las Vegas home.

This restaurant is looking to reform traditional Mongolian cuisine and is the first of its kind to combine refrigerated, conveyor belt-based hot pot with the finest traditional foods from Asia. The goal is to provide customers with the healthiest way to enjoy fresh dishes.

Looking back in history to 1988, the only authentic Asian influence on Spring Mountain was the Cathay House Chinese Restaurant. Located just west of Decatur Boulevard, the restaurant had an unobstructed view of the entire Strip and was known for fine dining.

However, all of that changed nearly overnight in 1995, when James Chen, the Taiwanese-American owner of JHK Investment Group, bought the two block warehouse-retail complex at the corner of Spring Mountain and Valley View Boulevard and gave it a complete makeover, using traditional Chinese architectural colors and facades and rebranding it as Chinatown Plaza. Chen even built a paifang, a traditional-style Chinese arch as a gateway to the plaza.

Promoted as a blend of “East meets West” where Asians can buy traditional products and others can experience Asian culture, the plaza became an immediate success.

In 1999, then-Gov. Kenny Guinn officially designated this section of Spring Mountain as Chinatown, prompting exit signs off Interstate 15 and a rapid westward expansion of Asian culture businesses to Rainbow Boulevard where the Korea Town Plaza now occupies a prominent corner featuring the Greenland Supermarket and food court.

Around 2004, the modern Pacific Asian Plaza opened with a supermarket and 31 businesses, from restaurants, tax services, insurance companies, hair salons, a massage school, real estate offices, smoke shops and a lounge.

According to Lana Pazargad, coordinator for the Plaza, “The businesses are predominantly Chinese and Korean, but there are shops owned by immigrants from about nine separate Asian countries.”

In 2006, an Asian-themed hotel-casino was planned for the southeast corner of Spring Mountain and Valley View, but as with many projects, the recession made those plans crumble. Today, that site is owned by Fore Property and construction has started on a 295-unit apartment complex with modern amenities. Citing the fact that Chinatown is a “vibrant area,” the owners are hoping to capitalize on the abundance of restaurants and shops located just across the street.

dina-titus-2During the Aug. 25 meeting of the Asian Chamber of Commerce, U.S. Rep. Dina Titus was the featured guest speaker and complimented both the chamber and its members on the significant contribution they have made to the community and the economy.

Quoting statistics, Titus stated that outside of California, the Las Vegas metropolitan area has the third-largest Asian population of any metro area in the western U.S., growing from 3 percent in 1990 to 10 percent of today’s population.

“Not only is the Asian community 10 percent of our population, it is also 9 percent of the electorate in Nevada. In some of the close elections, for which Nevada is famous, the Asian vote has made a key difference for candidates winning by just 6 to 8 percentage points,” Titus said.

According to the U.S. Census Bureau, Asians overtook Hispanics as Nevada’s fastest growing immigrant group — almost doubling the growth rate of immigration from Mexico and Central and South America.

Of the current population, the Filipino-American contingency is the largest, followed in order by the Chinese, Japanese, Korean and East Indian populations.

In 2015, Robert Lang, director of Brookings Mountain West, told KNPR’s “State of Nevada” that one of the biggest draws for Asian immigrants has been the availability of health care jobs.

According to Lang, Nevada went looking for those skilled workers from Asia and has benefited greatly. “We would be worse off if we didn’t have so many Filipino nurses,” Lang said.

Titus, during her speech, found it interesting that “In the high schools in my district, which are so varied, during the last school year Tagalog (spoken in the Philippines), Japanese and Vietnamese are among the top five languages that were spoken.”

According to David Zhao, CEO of NXTFactor, a partner in the Chubby Cattle Restaurant, “after researching the hot pot market in Las Vegas, we saw a huge opportunity to open Chubby Cattle, as there were no modern and authentic hot pot restaurants in the area. The soup base, sauce station, cooking method, food distribution system, quality of food and drinks were just outdated. It’s time to revolutionize the hot pot experience and to be able to showcase this world-renown cuisine (with both history and culture) to the West.”

The Cathay House, which suffered in popularity and then financially after the vacant property just to the east was developed, blocking the picturesque view of the Strip, has been closed and reopened multiple times. In 2013 the name was changed to The Jade Restaurant and in January of this year the property was sold again and reopened again after a major renovation under the name Hong Kong Dim Sum and Seafood Garden II.

As for the Chubby Cattle, Zhao has high hopes for the prominent location along Spring Mountain’s prosperous Asian-themed corridor but is not stopping there.

“Consider this the first location for Chubby Cattle as we plan on taking it to the high-profile hotels and potentially along the Las Vegas Strip. We’re already in discussion with upcoming establishments for opportunities for the second franchise of our conveyor-belt hot pot and barbecue experience,” Zhao said.


Compound pharmacies spread to meet need for customized prescriptions in Southern Nevada

In the past six years, compound pharmacies, which customize prescriptions according to a physician’s specifications, have spread in Southern Nevada. The niche market is growing both locally and nationally.

Customized prescriptions are necessary for patients who need a specific potency that isn’t available in premanufactured, over-the-counter doses, or to eliminate inactive ingredients that may cause an allergic reaction in patients. These pharmacies also prepare prescriptions for alternative routes of administration, and can change or enhance flavoring to make a prescription more palatable.

According to American Pharmacist, an industry trade group, about 65 percent of the nation’s independent pharmacies provide compounding services. These pharmacies fill prescription orders for the general public, and also serve hospitals, senior care facilities and other specialty care medical facilities, the group said.

In Las Vegas, the oldest retail compound pharmacy is Partell Specialty Pharmacy, licensed in 1991, that has two retail locations. In 2006, Solutions Specialty Pharmacy opened, followed by Precision Specialty Pharmacy in 2010, each with one location in the valley. From 2012 to 2014, four other compound pharmacies were licensed locally.

Adults 65 and older are likelier to have chronic illnesses, which increases demand for prescriptions. Also, elderly people often require personalized dosage forms, flavors or medications that comply with their allergies and alternative routes of administration.

Industry size

The Pharmaceutical Research and Manufacturers of America reports that about 3.6 billion prescriptions are dispensed in the United States each year. The U.S. Pharmacopeial Convention estimates that 30 million to 40 million of those prescriptions are compounded medications.

According to the report, there are 5,513 retail compounding pharmacies in the United States, which generate $5.6 billion in revenue and $1.5 billion in profits. From 2015 to 2020, industry revenue is forecast to grow at an annualized rate of 2.6 percent to $6.4 billion. The breakdown of revenue sources are:

■ Pharmaceutical ingredient alternation 35 percent

■ Pharmaceutical application alternation 20 percent

■ Currently unavailable pharmaceutical manufacturing 20 percent

■ Pharmaceutical dosage alternation 15 percent

■ Specialized animal pharmaceutical 10 percent

Most major hospitals have their own in-house compounding pharmacies that aren’t included in this survey.

Licensing

A Nevada State Board of Pharmacy representative said compounding is a general term referring to pharmacies that dispense medications according to a physician’s prescription.

Dispensing a 30- or 90-day supply of pills, or liquid medicine, even if premanufactured, is a form of compounding. However, not every pharmacy is equipped or has the expertise to mix pharmaceuticals to a custom strength/potency, and package them as directed in capsule, liquid, cream, gel or powder form.

Although all pharmacists graduate with basic compounding knowledge, pharmacists who work in compound pharmacies take specialized continuing education courses in compounding medicines.

Professional Compounding Centers of America, an education organization training pharmacists in compounding techniques, supplies compounding equipment and maintains a database of over 8,000 proprietary formulas of medicines that have been pretested.

“Our pharmacists have access to proven and pretested formulas, which we use as the basis for our compounding work. The formulas are made up of inactive and active ingredients, and after we mix those ingredients together, the compound is tested to make sure it meets the potency requirements prescribed by the physician,” said Precision Specialty Pharmacy owner George Maiorano.

Sterile versus nonsterile

There is a distinction between being able to compound sterile and nonsterile pharmaceuticals. Nonsterile medications are pills, creams, lollipops and gels that are not contaminated by exposure to the atmosphere. Sterile medications are those produced within a special bacteria-free environment, and delivered by injection or IV bags. Only three of the seven compound pharmacies in Las Vegas — Partell, Precision, and Solutions — have the facilities to produce sterile medications.

Besides compounding, most of the specialty pharmacies also dispense standard premanufactured medications and health products.

“We do it as a convenience to our customers,” Maiorano said. “Many of our customers want to shop in a single location, so we also provide them with heart or diabetes, and other medicines, that they take on a regular basis.”


Businesses struggle under the weight of merchant cash advance loans

Government agencies, banks and consumer advocacy groups have been trying to find ways to clamp down on the predatory nature and proliferation of payday and title loan businesses.

However, hiding in the shadows is another growing industry that is taking advantage of small businesses in Las Vegas and across the U.S. They are companies offering merchant cash advance loans and are cleverly disguised to skirt the usury laws.

Not any longer: The city of Chicago and the states of New York and California are leading the charge to develop legislation that will help business owners avoid the predatory lending practices of merchant cash advance companies.

The merchant cash advance loan business is a new industry that developed during the recession of 2008 when, because the bank lending criteria became so tight, very few small businesses could qualify for traditional loans. However, these same small businesses still needed the occasional short-term cash infusion to maintain business operations.

Modeled after the payday or title loan advances, merchant cash advance loans use a business’s receivables as collateral. The receivables can be the daily credit card transactions or invoices to clients. To pay the loan back, a percentage is taken directly from the business’s checking account on a daily basis. And, if a business misses a payment because there’s not enough money in their account, the loan company has the right to call the loan all due and take all of the money out of the account the next time funds are available.

Credit underwriting for these companies will monitor the borrower’s bank statement to decide how much money they can take out of the borrower’s account based upon the cash flow, to pay themselves back. While many of the lenders state that there are no “hidden fees,” the pricing of these loans is never clear and usually based on very high fees. The fees are not called interest, so as not to look like a loan and to avoid banking laws.

An abbreviated list on the internet shows 50 non-bank, private companies that offer cash loans to businesses. The internet pop-up ads all make similar claims of:

■ E-Z online application!

■ Funding in 24 hours!

■ No collateral!

■ Open a free account in under five minutes!

While each of the merchant cash advance lenders competes heavily for business, most have similar terms and interest rates. To qualify, many of these lenders also force businesses to switch to their own credit card processing service, which usually charges a higher credit card processing fee than the more common processors.

David Cabral, president of Las Vegas-based Business Finance Corp., has analyzed several of these types of loans for his clients and was shocked by the results.

“We recently looked at a loan that was made to a small business for $20,000. The payments were $220 a day, and our calculations showed that the loan would be paid off in 126 daily payments — about six months. The total payments will equal $27,800 and amount to an 81 percent annualized interest rate. If the loan were paid back in three months or less, the payoff would be $24,800 and amount to a 96 percent annualized interest.”

“We also recently saw a loan agreement with one of these companies in which the business owner assigned his building lease to the lender and gave the lender specific rights to walk in and take over their company if the loan was in default,” Cabral said.

Cabral cautioned that “some of these companies call their documents factoring agreements to circumvent state lender licensing regulations.”

Business Finance Corp. is a Las Vegas-based company that “factors” or purchases business accounts receivables.

“The difference is when a company like ours purchases specific invoices at a specific agreed upon discount price, we advance a percentage of the invoice(s) to you, the business owner, and when the customer pays the invoice, we are paid back, and our client receives the balance of the funds due them,” Cabral said.

According to the Business Finance Corp. website typical factoring discounts range from 3 percent to 5 percent for 30 days.

In Chicago, Mayor Rahm Emanuel has launched a campaign to help business owners avoid the predatory lending practices of business-to-business lending companies like merchant cash advance lenders. He has instituted a Chicago Microlending Institute (CMI) that offers financial counseling and affordable loans. In addition, an amendment to Illinois Senate Bill 2865 establishes lending parameters and requires a licensing fee along with a $500,000 surety bond for private businesses that provide merchant cash advance loans not exceeding $250,000.

Earlier this year, the Obama administration asked the Consumer Financial Protection Bureau to look at ways to crack down on the personal payday and title loan operations while the merchant cash advance lenders are being ignored. However, Emanuel is increasing his pressure by calling for other state and federal agencies to increase their regulations of the industry.

Apparently, New York is listening, and its state Assembly has introduced legislation requiring its Department of Financial Services to study online small business lending and prepare a report by Jan. 1, 2018. The scope of the study includes determining whether online lenders are offering credit at reasonable and transparent interest rates and fees and offering payment terms that can be met by borrowers. The department also has been directed to go into the type of underwriting conducted before issuing credit, and to check whether lenders verify borrowers’ credit data before providing funds.

California is also taking a serious look at this issue. A recent Bloomberg BNA report shows that California is collecting data from the largest online lenders to enable state officials to draft a non-bank lending statute to be used as an enforcement and regulatory tool. A report issued on April 8 shows details collected from 13 of the country’s biggest online lenders, that small business borrowing from online lenders grew from $1.99 billion in 2010 to 15.91 billion in 2014.

A study by the Opportunity Fund, California’s largest micro-finance lender, found that small businesses that borrow from online lending companies pay an average annual percentage rate of 94 percent. Of the 150 loans made by 54 different small business lenders, one carried an APR of 358 percent while 24 loans had interest rates that averaged 178 percent.

Another report by the Woodstock Institute studied 15 loans by online lenders to Chicago businesses. It found that five loans carried rates between 26 percent and 60 percent, four loans were granted at rates of 324 percent or more and the remaining had interest rates of 94 percent or higher.

Nevada does not have a limit on the rate of interest to which parties may agree so long as the agreement reflects an arms-length transaction. Nevada also allows for compound interest on loans.

While Nevada does not have a general limitation on interest rates, certain transactions and businesses are subject to restrictions. Pawnbrokers, for instance, are prohibited from charging more than 13 percent per month on any loan secured by personal property that is pledged to, or held by, a pawnbroker.

Both consumers and businesses can contact the Nevada Bureau of Consumer Protection, under the direction of the attorney general and consumer advocate for advice on activities that fall under the Nevada Deceptive Trade Practices Act.

An alternative to borrowing money from merchant cash advance lenders may be to apply for a loan through the federally funded Small Business Administration. The drawback for a company needing immediate cash is that the application process is not very fast and requires the development and approval of a business plan, which also takes time to write. Also, businesses may be required to fulfill training or planning requirements before a loan application is approved, another time investment before the cash can be received.


Municipality headed toward net-zero energy

The city of Las Vegas is looking a bit more green these days. Over the past 26 years, it has reduced its energy costs by $5 million annually and increased the recycling rate to 60 percent. The city recently signed contracts for hydropower and solar energy that will reduce greenhouse gas emissions by 85 percent while increasing the amount of green energy use to 100 percent. It is on track to become one of only four net-zero energy cities in the U.S.

The city started its green transition in 2008 with the receipt of money from the National Recovery Act. However, the project was set into motion three years earlier when former Mayor Oscar Goodman signed a Climate Protection Agreement drafted by the U.S. Conference of Mayors to urge the federal and state governments to take action against climate change.

One of the first projects involved changing streetlights from energy-hogging mercury vapor and high-pressure sodium lights to energy-efficient light-emitting diode bulbs; approximately 80 percent of the fixtures have been converted.

Significant in the commitment to becoming green was the construction of the new $146 million City Hall building, which opened Feb. 21, 2012. Designed with advanced energy and water-saving factors including Low-E windows, high R-value insulation, innovative heating and air conditioning and solar panels that provide 10 percent of the total energy, the building was certified by the U.S. Green Building Council with a silver rating under the Leadership in Engineering and Environmental Design standard.

Another showcase is the original Las Vegas Post Office, which was acquired by the city and converted to the Mob Museum. During its restoration, the building was gutted and updated with the latest insulation, lighting, thermal windows and air-conditioning technology resulting in a LEED silver certification for a building retrofit.

The city owns or leases thousands of square feet of building space in about 120 buildings throughout the city limits. Included are fire stations, park buildings, and various warehouse and administrative buildings. Many of the new fire stations have been LEED-certified and facilities throughout the city have been equipped with solar panels to offset some of their energy use with sustainable solar power.

All of the solar energy systems on city-owned properties combined provide approximately 12 million kilowatt-hours of clean energy per year.

In addition to generating clean energy, the city has been busy retrofitting all of its buildings with new energy- and water-saving technology. Most of the office building lighting has been converted from fluorescent and incandescent fixtures to LED. And low-flow water devices and toilets have been installed in all restrooms.

One of the largest retrofit projects involved the replacement of all windows and a new heating and cooling system on the nine-story Development Services Building at the corner of Rancho Drive and U.S. Highway 95. Originally built with 1980 technology, the city also installed modern water-efficient fixtures, LED lighting and occupancy sensors that turn off lighting when the room is not in use.

In 2010, the city used over 150 million kilowatt-hours per year, with the current conversions in place. That number has dropped to below 120 million. And despite a 57 percent population increase over the last 26 years, Las Vegas has reduced greenhouse gas levels by over one-third, bringing it down to 1990 levels.

Even with all of the accomplishments, the mayor, Las Vegas City Council members and city staff have not stopped working toward becoming more sustainable.

Starting in October 2017, Las Vegas will receive two megawatts of hydroelectric power generated by Hoover Dam. This energy is not only clean and sustainable but inexpensive. The allocation is the result of a recent federal act that reallocated the dam’s power distribution. The city of Las Vegas was one of the many applicants that were accepted from a number of governmental entities and Native American tribes.

City officials have also signed an agreement with NV Energy to purchase all of its power from the Boulder City II Solar Energy Project upon its completion in January. With this agreement, the city of Las Vegas will become a 100 percent net-zero-energy city. What makes this accomplishment,even more groundbreaking is that the other cities in this elite category have populations under 50,000 and use far less energy than the city of Las Vegas with a population of more than 600,000.

The added solar and hydropower energy also will reduce greenhouse gas emissions by 85 percent.

On Dec. 6, 2015, the city of Las Vegas received certification as a Four-Star Community, earning 77.8 points out of 100 in the category of Climate and Energy. The city ranked high in the subcategories of Greenhouse Gas Mitigation, Greening the Energy Supply, Resource Efficient Buildings and Waste Minimization.

The city of Las Vegas is also focusing on becoming the net-zero capital of waste. Leaders are looking at ways to compost all of the organic waste, which includes grass and tree clippings that accumulate from parks and green areas throughout the city.


MGM Mirage Sustainability Discovery Center provides educational programs

David Blasko is passionate about saving the planet and caring for the creatures of the earth. He is also the director of the department of animal care for The Mirage and the creator of the MGM Mirage Sustainability Discovery Center.

The purpose of the Sustainability Discovery Center is to educate visitors and locals on the importance of taking care of the environment.

“The one thing that I have failed to do for perhaps the first two-thirds of my career is to give people action items where they can make a difference. We have instilled passion but failed to provide a path,” said Blasko, speaking about his 45-year career in caring for animals and educating people about the role that animals play in the environment. The last nearly 10 years of his career have been spent at the Mirage where he oversees the health and safety of the resort’s dolphins and white tigers.

It was Blasko’s passion for saving the environment that started him thinking about the development of a Sustainability Discovery Center.

“I thought that it was important to develop messaging that would give people action items so that they can go out and do things that would have a positive impact on the environment and help these animals.”

It took about 18 months and a large team of individuals with varying skills to bring Blasko’s vision to reality. “You have to understand that it is a very strange, twisting path from my brain to where something actually happens,” Blasko said with a laugh when asked how the idea for the Sustainability Discovery Center came to be.

The theme that was developed is based on water because of the important role that it plays in the lives of animals and humans, no matter where they live. As mammals, dolphins are very sensitive to changes in the ocean and that ties into the Dolphin Habitat at the MGM Mirage.

The MGM Corp. is very invested in sustainability. Each of the properties along the Strip and around the world goes to great lengths to conserve water, energy and to recycle waste.

In Las Vegas, Republic Services is a key partner in helping the MGM properties recycle as much material as possible. As a result of the MGM and Republic partnership, MGM Resorts recycles 28 million glass bottles each year. In 2015, The Mirage alone reached a 45 percentile in recycling, equaling over 4,000 tons of material that did not go to the landfill.

“We are always looking for ways to educate the community about how recycling helps the environment,” said Tracy Skenandore, area director of public relations and field communications for Republic Services Mountain Area.

Republic services recently constructed its $35 million, 110,000-square-foot recycling center with the capacity to process 3 million pounds of paper, glass and metal.

“Now that we have opened our new recycling facility, we are expanding our community outreach even more to encourage greater participation in the recycling program,” Skenandore said.

The Dolphin Habitat and the Sigfried &Roy Secret Garden are research and education facilities that offer tours to over 6,000 school children each year, teaching them about the ocean, the marine animals and the environment in general.

“We saw the Sustainability Discovery Center as a great opportunity to team with MGM in our effort to promote responsible waste management and recycling alongside MGM’s effort to promote their worldwide commitment to protecting the global environment,” Skenandore said.

Both the MGM and Republic Services understand that by teaching children the values of sustainability at an early age, they will continue those habits into adulthood. In fact, the children may be able to teach their parents the value of recycling, which in turn will help the Las Vegas community as a whole.


Big data meets casino floor

A lot has changed in the gaming industry — most notably, the shift from a single stream casino-based profit center to multiple profit centers in the retail, restaurant, nightclub, hospitality and even the swimming pool areas.

It used to take an army of accountants to gather data from each of the department silos and combine them into rudimentary reports, charts and graphs. Those functions are now performed with the push of a button, thanks to a company called VizExplorer.

The company is the brainchild of Andrew Cardno and took six years to develop. It was founded in 2008.

Cardno, the founder and chief technology officer of VizExplorer, is not only an expert at analyzing and interpreting data, he co-wrote the book on casino data analytics, “The Math that Gaming Made” (2011). His co-author is Ralph Thomas, a UNLV Ph.D. graduate in mathematics and VizExplorer’s chief data scientist/general manager of gaming and strategy.

Together, Cardno and Thomas have authored an 18-part series for Casino Enterprise Management Magazine titled, “Where is the Money?” Cardno holds more than 60 patent applications and has been a featured speaker on the subject of analytics at a variety of venues around the world.

VizExplorer’s corporate headquarters are in San Diego, but the Las Vegas office on Eastern Avenue near Windmill Parkway employs a team of 45 computer software engineers and analytical experts who spend their days developing complex algorithms to analyze casino operations. Cardno expects that number to grow to 60 employees in the next year.

Part of Cardno’s expertise is in the analysis of gaming customers. His programs analyze customer types and gaming preferences. VizExplorer’s team of Ph.D. and master’s-level researchers have developed an operational intelligence company focused on developing software that enables companies to analyze complex consumer data from multiple sources and then act on that data. The tools are designed to take a company from analysis to action.

“I think that the casino resort industry is very innovative, and I see constant change and new products,” Cardno said. “It is evolutionary, and I just love the speed with which we have innovated. It is hard to have imagined. In the future, I see a completely new business model developing with different kinds of social entertainment and new kinds of games emerging.”

In a January article titled Creating Customer-Centric Gaming Floors, Cardno states that “catering to today’s older gamblers while ignoring future gamblers (including potentially the very large group of millennials) is an extremely risky proposition for a casino.”

To demonstrate how the types of patrons and their preferences can change over time, Cardno uses the “Red Beaker Analogy.” In his example, a beaker is filled with red fluid symbolizing the initial group of customers. As a new group of blue customers start to patronize the casino, the water in the beaker starts to turn purple until the new type of player dominates the casino floor, turning the fluid to blue. The transformation is easy to see with water and colored dyes, but not so easy to detect without analytics to monitor.

“However, while following the slot averages and thus naturally catering to red customers seems like the right thing to do, we ignore blue customers at our future peril. They are the future of our business, and a lost new customer today could mean multiples more lost in the future,” said Cardno.

According to Cardno, “Much of the discussion around millennials has fallen into one of two camps: marketing and new products. On the marketing side, casinos are trying to create new areas of excitement that will draw millennials into gambling while they enjoy their current casino entertainment options of choice, like shows and dining. On the product side, slot operators are beginning to explore the concept of skill-based slot machines.”

Perhaps the millennials are the blue dye that changes the beaker water totally blue. With proper analytics, that tipping point will be visible to the casino executives, and they will then start monitoring for a new “red” group of players who will slowly turn the beaker fluid back to its original color.

The Silverton Casino was the first to buy into Cardno’s theories and expertise by becoming VizExplorer’s first customer. Using VizExplorer’s complex analytics has helped the Silverton to successfully expand its highly visible off-Strip presence.

Today, in addition to the Silverton, VizExplorer customers include Boyd Gaming, Station Casinos and more than 600 other casino clients on five continents. And VizExplorer is expanding its services to sports stadiums and manufacturing facilities.

In an article published in Casino Journal Feb. 9, Cardno writes “it is not just size of data that matters, it is also the diversity of sources.”

Cardno’s analytical programs combine the diverse data sources within the resort casino, systems like slot and table player tracking, slot and table accounting, cage accounting, bingo-poker-sports, hotel, food and beverage, employee tracking, valet, spa and many others. And of course, the data sources are multiplied by the number of resort properties.

“The challenges are the same regardless of the size and scale of the resort organization,” said Cardno

The main challenge is distilling the mountain of financial reports and customer profiles into useful information for the C-suite executives and the management team.

Cardno uses the example of the casino shuttle driver who picks up clients at the airport and various locations and drives them to the casino or planned events. The VizExplorer’s hostViz and greetViz modules provide real-time customer profiles that are available via smartphones and tablets. The connectivity of these programs allows the shuttle drivers and casino hosts to interact with the customers and make them feel welcomed by knowing when they last visited, the activities they like, where they are from, family members and other useful information.

Three other program modules are also available. FloorViz is an advanced slot floor optimization solution to help increase profits and maximize slot machine return on investment. CampaignViz is a marketing campaign management solution, complete with test and control to better segment audiences to deliver targeted campaigns to high-value players. And techViz is a real-time service and dispatch management solution to maximize the efficiency of the service department and drive slot floor profitability. All modules are designed to assist various levels of management with both the overall management of the resort and the individual departments.

On July 13, during the Casino Marketing &Technology Conference at the Paris Hotel, VizExplorer introduced its latest module, greetViz. The new program is designed to provide automated mobile alerts to staff members when important guests enter the property. This program allows staff members to personally greet the guest, send a drink, or welcome them in some other meaningful way.

“We have truly become the operational front end of a gaming operation,” said Cardno.