Fresh Loaf

Atlanta Business Chronicle reporter and mega-Twitterer Urvaksh Karkaria has more good news from Research in Motion, the company that makes the BlackBerry phone:

Research in Motion investing $300M in Atlanta – Jim Balsillie. More details on his talk in upcoming @Atlantech post.#TAG

In May, Karkaria reported the Canadian tech giant’s plans for 200 RIM jobs in Alpharetta. Does the $300 million investment Karkaria reports today mean we can expect even more RIM jobs? Let’s hope so. With the metro Atlanta unemployment rate at 10.5 percent, there are plenty of people around here who could use a good RIM job.

Details forthcoming on Urvaksh’s AtlanTech blog.

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The AP’s Russ Bynum writes an excellent piece that helps explain why Georgia has found itself at the tippity top of a terrible list — the state with the highest number of bank failures:

Experts say it’s a combination of an antiquated state law that favored a plethora of smaller community banks over multi-branch giants; a population explosion in metro Atlanta that fueled massive suburban real estate development and a crush of new banks formed to cash in on the Atlanta boom shortly before the market tanked.

…

Georgia’s diversity of small banks was an asset when the economy was strong, with consumers benefiting from competitive rates and broader sources of credit, said James Verbrugge, a professor emeritus of finance at the University of Georgia’s Terry College of Business. It became a liability when the bottom fell out of the housing market and smaller banks had less capital to weather the crisis.

The excerpts don’t do the article justice. Give it a read for your daily dose of edumacation.

(Hat tip to Travis Fain)

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Whereas, things worth remembering need names. Children, pets, generations, boats. If we didn’t name them, then we might forget ‘em.

Whereas, when this current recession — or “current economic crisis” — ends, we better have some way of distinguishing it from the other occasional economic dips this country’s seen.

Whereas, I, Thomas Wheatley, who as an employee of Creative Loafing enjoy a wide variety of useless trinkets in my vicinity, have the desire to award the commenter who provides the best name for the “current economic crisis” with a scribbled-on Sany Group hat snatched from an “economic development” announcement. Or a National Rife Association bumper sticker currently plastered on my cubicle wall. (Or maybe tickets to something? I don’t know, I can’t promise anything. I’ll have to check with our marketing department.)

Therefore, let it be resolved that I am sick and tired of referring to the “current economic crisis” as such, and would like to know what to call this damn catastrophe in which the country finds itself.

Please leave your suggestions in the comments. You can also e-mail me. Be sure to let me know how I can get back in touch with you.

(Many more silly boat photos at Media-Post)

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Labor Commissioner Michael Thurmond

In this week’s feature, “The big hurt,” I write about Georgia’s rising unemployment rate and how it’s impacting metro Atlantans. To better understand the current economic landscape, I visited the state Department of Labor’s recent job fair at the Georgia World Congress Center. The event, which organizers estimate attracted more than 19,000 job seekers, was considered the largest in the state’s history. To view Joeff Davis’ photographs of the event, go here.

While reporting on the convention center floor, I spotted Commissioner Michael Thurmond monitoring the event from a hospitality suite. Thurmond, who’s brutally honest but optimistic about the situation, agreed to chat. After the jump, a transcript of my interview with the commissioner. In it, he talks about how the state can prepare for a recovered economy, the impact of globalization, and the job-loss story that hit him the hardest.

(File photo by Joeff Davis)

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First come the slots. Then come the men cavorting with white tigers and the true artistes! But until then…baby steps.

And today, the Atlanta City Council voiced its support  for a plan that could drastically change Underground Atlanta and bring gambling — well, video lottery terminals — to the long suffering downtown attraction. Council voted 11-0 to approve a resolution supporting the proposal and form a committee to study the project.

Underground Atlanta leaseholders Dan O’Leary and John Aderhold say a remake of the area could bring jobs and much-needed revenue to the city. The two recently proposed a $500 million redevelopment plan that would convert Underground Atlanta’s 12 acres into a complex featuring a 29-story hotel, restaurants, shops and lottery terminals.

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Last August, Wordsmiths customers helped it avoid shutting down. As of today, however, the popular downtown Decatur bookstore is closed.

From its blog:

I’ve pondered how to start this, but this is the best I can come up with. There is no great way to begin the end of a dream, and there is no gentle way to state that finality is upon you. That said, I regret to announce that, as of Monday, March 2nd, 2009, Wordsmiths Books will close its doors for good. I don’t do this willingly, and I would love to say that there were avenues of exploration yet to wander, possibilities that could avert this outcome, but that would be untruthful. I have explored every possibility open to me, but the sheer magnitude of the decline in sales alone (on the heels of our efforts to right the boat) from our current economic downturn has long since evaporated the fumes. Frankly put, there’s nothing left to make the engine go, and sitting on the side of the road with a thumb out doesn’t seem to earn you much grace as a business.

Be sure to read it in full as it’s a poignant goodbye post.

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On Sept. 15, 2008, the stock market’s death rattle was amplified by Wall Street giant Lehman Brothers’ decision to file for bankruptcy.

One mysterious man named “Reinhardt” predicted the date and details of the collapse on a Google finance message board months before the fact. He also explained — in great detail — that the crash was caused by an organization with Catholic ties. And that one of the group’s founders was Tom Monaghan, the brains behind Domino’s Pizza. So there’s that.

Yesterday, Gawker reported that “Reinhardt” has revealed his identity on his blog. He says another financial asteroid is approaching and will strike on Feb. 9. Thank God people are buying pitchforks and learning Tae-Bo!

What’s the local angle, you ask? Well, according to his blog, “Reinhardt” lives in Atlanta. The “Real Housewives” don’t have anything on this dude.

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Remember the AJC’s story about Gov. Sonny Perdue’s $21 million loan? He borrowed the cash from a small bank in Perry, Ga., for his two agricultural businesses, which, unlike previous governors, he’s opted to continue running while he also manages a state of 9 MILLION PEOPLE. Repayment of the loan, the article said, is due in March.

Perdue’s office told the AJC that he wouldn’t disclose the specifics of the loan. The Athens Banner-Herald’s editorial board has laid down the funk on Perdue for his tightlipped behavior.

Retrospective, you say? I love retrospectives!

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The Georgia Association of Rail Passengers has called for Gov. Sonny Perdue to restore funding for the Atlanta-Griffin commuter rail line that’s been earmarked for federal dollars and which the governor said he’d support during last year’s gas shortage. U.S. Rep. David Scott, D-Ga., has already scolded Perdue for not funding the line.

Passenger rail advocates are calling on the Georgia General Assembly to approve $15 million in funding for Atlanta-Griffin commuter rail line, despite Governor Sonny Perdue’s failure to include the money in his budget.

“It’s extremely unfortunate that the Governor went back on his promise to fund the Atlanta-Griffin line,” said Steve Vogel, president of the Georgia Association of Railroad Passengers (GARP).  “It also was a big mistake.”

The federal government has $87 million set aside for the rail project, but it’s been stalled for years by state government inaction.  The Georgia Department of Transportation has asked for $15 million to get the project moving again.

Rest of the release is after the jump.
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SPARE $2 BILLION? Perdue delivers bad budget news to lawmakers

It’s a shame Gov. Sonny Perdue’s penchant for prayer doesn’t work as well for deficits as it did for drought. If that were the case, Georgia would literally be swimming in greenbacks.

With revenues plummeting in an economic landscape akin to Mad Max, the state is currently facing a $2 billion shortfall, the deepest hole anyone at the Gold Dome says they’ve ever seen. In response last week, Perdue delivered a cost-cutting whack, slashing nearly all state agencies and programs — many of which state Democrats say help the most vulnerable of Georgians in this most precarious of times.

The Department of Labor, the state agency that’s been the first stop for pink-slipped residents? Nearly 13 percent cut. The Public Defender Standards Council, the arm of government that provides indigent defense attorneys in an attempt to ensure justice for both defendant and victims? Almost 11 percent cut. The departments of Education, Community Health and Human Resources? Cut, cut, and cut. State employees’ salaries? Frozen — and vacant positions eliminated.

Add to that the $350 million slashed from K-12 educational funding, and you’re left with a budget that has little wiggle room. From lobbyists to lawmakers, behind-the-scenes staffers to Gold Dome shoeshine men, everyone we queried agrees: The 2009 legislative session will be about money, and what little of it the state has.

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It’s not just the state’s $2.3 billion budget deficit that’s giving Gov. Sonny Perdue a headache.

The AJC’s Alan Judd reports that the clock is ticking for the governor to repay a $21 million loan given to him last September by a small bank in Perry, Ga. Perdue borrowed the money for his two agricultural businesses. (Since taking office in 2002, the governor has differed from his predecessors in that he still operates his businesses rather than placing them in a blind trust. The strategy seems to have paid off — according to Judd, Perdue’s financial holdings have risen in value since he took office.)

But…(cue ominous tone)

… public records and interviews suggest the governor got the loan under remarkable circumstances.

The lender — a farm credit bank based in Perry — allowed Perdue to put up collateral worth less than 20 percent of the loan’s value, according to a security deed filed in Houston County Superior Court. Commercial lenders typically insist on a far greater level of collateral, and the federal agency that regulates farm banks requires strict underwriting standards to guarantee loan repayment.

The bank, AgGeorgia Farm Credit, focuses on real estate lending and carries just $55 million in business loans on its books, according to its latest quarterly report. Now a large proportion of that portfolio is devoted to the governor, who is a familiar figure to AgGeorgia’s leaders: Eight of the bank’s 23 directors contributed to Perdue’s re-election campaign in 2006.

Oh, and what was the loan for? Perdue won’t say.

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MARTA officials today said in a press release that a new economic forecast predicts the transit agency’s budget woes will worsen.

The latest economic forecast issued in December 2008 for MARTA by the Georgia State Economic Forecasting Center predicts a further worsening of its current fiscal crisis by an additional $10 million. The forecast also predicts MARTA will experience a cumulative loss of more than $1.2 billion in sales tax revenue over the next ten years – that is up an additional $588 million from its fall 2008 report.

Last month, MARTA — which, it will be noted once again, is the metro region’s largest transit agency and the only one in the nation that doesn’t receive operating funds from the state  — announced it faced a $60 million operating budget shortfall for the fiscal year. MARTA officials asked lawmakers two weeks ago to allow greater flexibility for the one-cent sales tax revenue that funds more than half the agency’s operations.

Agency officials will hold a series of meetings next week to inform the public about potential changes. (The list of locations follows after the jump.)

And on that cheerful note, I’m out of here. Have a great weekend!

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Let the taps flow. For now, at least.

From the city’s Department of Watershed Management:

The Department of Watershed Management is restoring water service to Morris Brown College after officials presented the Department with a certified check for $30,000 a few minutes ago. In making the payment, the college complied with Judge Henry Newkirk’s order that Morris Brown pay $100,000 today ($70,000 after this morning’s hearing and $30,000 before 5 pm) toward its delinquent water/sewer bills. The balance on the remaining outstanding accounts, approximately $214,000, is to be paid on or before February 17, and the college must pay current charges.

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Alejandro linked to it below in this morning’s Newsdome, but I’ll save you the guessing game! From the Wall Street Journal:

ALPHARETTA, Ga. — Fourteen miles north of Atlanta is a suburb of wide boulevards, sleepy cul-de-sacs and bustling red-brick shopping centers. It also is the bank-failure capital of the U.S.

In just 13 months, three banks based within a few miles of each other went bust. Three more in other Atlanta suburbs were seized by regulators in 2008, as the region was haunted by overabundant home building, years of risky lending and one of the most relaxed regulatory environments in the U.S. for starting new banks, according to some experts.

…

Alpharetta Mayor Arthur Letchas bristles at the city’s distinction as an epicenter of bad banking, noting that 22 other banks have at least one office here. Technically, Integrity doesn’t count as Alpharetta-based, Mr. Letchas says, since its headquarters were just outside the city limits in Johns Creek, Ga.

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On my way in to work today, I saw Jeff Roof at the intersection of Freedom Pkwy NE and Ralph McGill Blvd NE. Jeff is an out-of-work medical assistant desperately in need of a job.

“I have been out of work for almost two months. Everywhere I look for a job they want you to apply online and everyday I apply online but I never hear back from anybody so I figured what would it hurt to go and stand in the intersection.”

“I put this off for a week because of the rain and fog. I finally said this looked like my best day so I thought I would come out and see what happens. I realize its tough for everybody but I need a job before I am out on the street.”

“I put on [an] elf hat ’cause I figured it would draw attention — I feel like an idiot but I figured why not?”

“I even wrote Ellen (DeGeneres) and asked her for help. I never heard back from her but mama always said it never hurt to ask, what do I have to lose?”

“One of the reasons I got out of real estate last year is because I didn’t have any health insurance so I figured if I got into the medical field at least I wouldn’t have to worry about it but now I don’t have any health insurance.”

“The main thing I am hoping for is someone will offer me an opportunity, that’s all I am looking for.”

“I have been out here for about an hour and nobody has offered me a job but a number of people have rolled down their windows and said ‘good luck Jeff.’ If the weather is good I will be out here again tomorrow.”

(Photo by Joeff Davis)

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The recession is taking its toll on MARTA.

MARTA General Manager and CEO Bev Scott says “devastating” drops in revenue collected from local sales taxes — which comprise 52 percent of its operating budget — has led to a shortfall of at least $60 million.

It’s worth mentioning that nearly every state contributes to its largest metropolitan area’s transit system’s operating costs — but Georgia does not.

Scott will hold a press conference to discuss the problem on Monday at MARTA’s Piedmont Road headquarters. It will begin immediately after the regularly scheduled Board of Directors meeting at 1:30 p.m.

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Polling organization Rasmussen Reports says:

The majority of voters in Georgia (53%) say Republican Governor Sonny Perdue is not doing enough to help them through the economic recession, though he still earns fairly positive reviews.

The latest Rasmussen Reports telephone survey in the state found that one in four voters (25%) say the governor is doing enough for Georgians, while another 22% remain undecided.

…

Still, more than half of voters (57%) approve of the way Perdue is handling his job as governor, while 39% disapprove.

The menz like duh govnuh. The ladies say “meh.” Also:

The early frontrunners among Republicans for the 2010 governor race in Georgia are Casey Cagle and John Oxendine. Cagle is currently serving as lieutenant governor, and Oxendine is the state insurance commissioner. Both men are favored by 14% of Republicans.

Among Democrats, former Governor Roy Barnes leads the pack of 2010 contenders with 28% support. Twenty-two percent (22%) of Democrats would consider voting for Atlanta Mayor Shirley Franklin for governor.

Check out the full rundown of responses. Among them: Barack Obama will do a better job as president than George W. Bush and native son Jimmy Carter.

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Effective Jan. 11, the Atlanta Journal-Constitution says it will shrink its circulation area to 27 counties and cut 156 jobs. The affected counties are mostly located along the Alabama and North Carolina borders (full list is available through the link). Jobs slated to be cut appear to be in the circulation department. (If I’m mistaken, please correct me in the comments or via e-mail. Anonymity guaranteed.)

From the report:

The move will reduce daily and Sunday circulation about 5 percent. But it will not significantly affect overall readership — a measure of readers rather than the number of copies — because that is based on a 28-county area, the AJC said.

The company said 215 employees have been offered involuntary severance packages as part of a restructuring of the circulation department, but that they may apply for 59 jobs created by the changes. The net reduction is 156 full- and part-time positions.

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Black Friday, who loves ya, baby?

From Gov. Sonny Perdue’s office:

ATLANTA – Governor Sonny Perdue announced today that net revenue collections for the month of November 2008 (FY09) totaled $1,419,543,000 compared to $1,399,595,000 for November 2007 (FY08), an increase of $19,948,000 or 1.4 percent.

The percentage decrease year-to-date for FY09 compared to FY08 is -1.3 percent.

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Cox Newspapers, a subsidiary of Cox Communications and owner of the Atlanta Journal-Constitution, says it will shut down its national and international news bureau in Washington, D.C. on April 1, 2009.

A company memo posted on Romenesko says the AJC and Dayton Daily News will “manage their own Washington and international newsgathering independently following the national bureau’s closing through dedicated correspondents in D.C.” Eligible employees of the D.C. bureau will be offered “generous” severance packages and continued employment until March 31. Bureau chief Andy Alexander will retire at the end of the year.

“The Washington news bureau and its chief, Andy Alexander, have an impressive and storied history in Washington and in our company,” Sandy Schwartz, Cox Newspapers president, said in the memo. “For more than 30 years, the reporters of this bureau have broken an untold number of stories that have had an impact on the lives of our readers in cities and towns all across the U.S. The Cox Washington bureau has won or shared virtually every major American journalism award, including the Pulitzer Prize.”

After the jump, read the entire memo. It includes details about Alexander’s career — it’s been an impressive one — and information about the international bureau.

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The New York Times had a piece this weekend examining how Savannah is faring during the economic downturn. Cargo shipping in the city — the fifth-largest along the East Coast — has flattened. Jobs have been cut at the ports while facility expansion has been ordered to go ahead. And then there’s this:

While [Georgia Ports Authority executive director Doug Marchand] and many others await an upturn, Savannah’s economy deteriorates. The unemployment rate in the three-county metropolitan area has jumped to 5.7 percent from 3.9 percent a year earlier. Analysts attribute the jump to hiring freezes and a lot of little job cuts.

With home sales down 24 percent, the local Coldwell Banker has watched its army of real estate brokers, the largest in the city, dwindle to 180 from 240 last year. “They just went into other businesses or stopped working altogether,” said Connie F. Ray, chief executive of the Coldwell operation here, adding that through last year brokers had been averaging $40,000 to $50,000 annually in commissions.

Manufacturers still have a big presence here, employing 15 percent of greater Savannah’s 171,000 workers, but factory employment is shrinking. Georgia-Pacific, for example, which makes paper towels, napkins and toilet paper at a mill here, no longer hires dozens of contract workers. They had been used as a flexible work force, a supplement to the 1,200 regular employees, to step up production during demand surges, now nonexistent.

Not all of Savannah is hurting, the article says — five hotels are under construction and Fort Stewart’s expanding. Luxury jetmaker Gulfstream is headquartered in the city; a company spokesperson says a long list of backorders will keep its workers busy for at least the next three years.

And there’s another sign of hope:

“When I go by a Red Lobster inn on the south side on a Friday night,” [John C. Helmken II of Savannah Bancorp] says, “there are people lined up waiting to be seated.”

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MARTA CEO and General Manager Beverly Scott, who was recently appointed chair of the American Public Transportation Association, testified before a U.S. House committee today and urged Congress to pass legislation that would inject sorely-needed funds into transit projects across the country.

APTA, Scott says, recently identified 559 “ready-to-go” projects in the United States worth $8 billion that would help create jobs and reduce greenhouse gas emissions. She also asked the government step in and examine financial agreements — which  I’ll warn you are rather complex but good to wrap your head around — transit agencies made with companies such as AIG that are in danger of unraveling because of Wall Street’s meltdown.

To read her full testimony, click here. Read about how Georgia specifically could benefit from increased transit investment after the jump.

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How’s this for a silver lining? The coming bad times could help a lot of us get over our addiction to “things” and at the same time move us toward solving the environmental crisis. That’s basically what Lisa Wise, executive director of the Center for a New American Dream in Washington, told me as I researched an article last week about how hard times are hitting Atlanta.

It’s provocative even to suggest that bad economic times could be good for your psyche and for nature. People think you’re living in a dream world, or that you want to punish them.

But I think there’s something to the idea that we don’t all need to wear the latest fashions, drive late-model cars and live in 3,000-square-foot houses. (This coming from a guy who’s trying to get going on a big addition to my house.) (more…)

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From the governor’s office (emphasis added):

ATLANTA – Governor Sonny Perdue announced today that net revenue collections for the month of September 2008 (FY09) totaled $1,632,334,000 compared to $1,561,749,000 for September 2007 (FY08), an increase of $70,585,000 or 4.5 percent.

The percentage decrease year-to-date for FY09 compared to FY08 is 2.6 percent.

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STOCK MARKET FRESH: Atlanta-based Arby’s completed a $2.2 billion buyout of fellow fast-foodies Wendy’s yesterday. The new company, Wendy’s/Arby’s Group, expects to add up to 100 new positions at its Atlanta headquarters.

In an interview with the Wall Street Journal, CEO Roland Smith says Wendy’s/Arby’s will focus on wooing older customers. Perhaps not coincidentally, stock in the company that makes Lipitor is up this morning.

FRESH START: Yesterday, the parent company of this blog filed for Chapter 11 bankruptcy protection, as well as lawsuits against three of its creditors for refusing to renegotiate the terms of the company’s loans.

CEO Ben Eason says the bankruptcy filing is not bad news, but instead characterizes the move as an opportunity to restructure the company’s debt under more favorable terms and make what he calls a fresh start.

A RAFT OF THEFTS: Georgia is reportedly the nation’s boat theft capital. I’m sure it sucks to have your boat stolen, but I’m having a hard time getting worked up about it.

BEAT IT: Former Blink182 drummer Travis Barker was released from an Augusta hospital yesterday. Barker was severely burned when the small plane he was traveling on crashed in South Carolina on September 19. Four people were killed in the accident.

HEADLINE OF THE DAY: For Many Americans, Fear and Distrust Run High

Really? I wonder why.

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