MedHab's Strip Center Manufacturing Site in San Angelo

The  story below piqued my curiosity as to MedHab's manufacturing facility in San Angelo. 

Texas Manufacturers Assistance Center (TMAC) recognizes a handful of Texas companies annually with its Customer Performance Excellence Award. MedHab will be honored August 7 at its manufacturing facility in San Angelo by U.S. Congressman Mike Conaway.

Two questions arose.  One, how does a company with no current customers get a Customer Performance Excellence Award?  And two, where is MedHab's new manufacturing facility?  The Standard Times reported on the latter:

Ross told a crowd of about 40 people at the company’s San Angelo office during an award ceremony and open house Wednesday in the Concho Valley Center for Entrepreneurial Development annex, 2009 W. Beauregard Ave.

A number of dignitaries attended the award ceremony in what looks like a old strip shopping center vs. an award winning factory:

Ross received a Customer Performance Excellence Award from TMAC on Wednesday. U.S. Rep. Mike Conaway, ASU Associate Dean of the College of Business Karen Shumway, Texas State Rep. Drew Darby and ASU President Brian J. May spoke at the presentation. Conaway said that Ross’s plan was a “great model” for private and public cooperation because, “the risk rests with the private sector.” 

San Angelo's $3.6 million MedHab public subsidy reduces that risk considerably and is a nice selling point to investors and capital markets.  What federal, state and other municipal support does MedHab have to manufacture in Athens/Rhode Island vs. San Angelo?

The feds are behind the National Institute for Standards and Technology (Department of Commerce).  TMAC is an affiliate of the Manufacturing Extension Partnership (MEP) program of National Institute of Standards and Technology (NIST). 

The Athens Economic Development Corporation established the Biotech Manufacturing Center of Texas (BMC). 

Located in Athens, BMC is a nonprofit biotech incubator providing a full-scale manufacturing environment for qualified medical device development. The BMC is the only medical business incubator in the U.S. that offers total manufacturing of newly conceived medical devices.  (www.athensedc.com)

The AEDC clearly has its sights set on biomedical :

“Medical devices are a primary target market for AEDC business recruiting strategy.” 

The Biotech Manufacturing Center received grant funds from the Texas Workforce Commission  and the AEDC.   It seems MedHab mined several levels of PPP.

MedHab Production Site is Athens!

For all the show San Angelo and Abilene made in recruiting MedHab's production site in early 2012, the company's initial product will be assembled in Athens, Texas.  MedHab founder Johnny Ross hedged on San Angelo production when he mentioned a redundancy location in February 2013 to San Angelo's Development Corporation Board.

Concho Valley Homepage reported:

The inserts will be tested and distributed from San Angelo. Medhab will also have a tech support team and call center at 2009 West Beauregard. 

The reporter stated assembly will begin in Athens, Texas on August 16th.   That didn't make Assistant City Manager Michael Dane's recent update to City Council.  Might City Council invite Johnny Ross for dialogue on the company's revised plans?  The timeline receded, fewer jobs added than anticipated and production has been located elsewhere.  It shouldn't be a problem for C-Suite communicator Johnny Ross to explain what changed and why. clearly stating the company's plans going forward relative to San Angelo.  Frankly, it's past time.

Update 8-8-13:  The Standard Times stated "MedHab will manufacture a movement monitoring device and software, called Remote Performance Measuring/Monitoring, in Athens, Texas.  The RPM2 devices will be built in Athens, finished in Rhode Island, then shipped to San Angelo for software testing before they are sent to customers, said Ross."  Also, Ross "plans to move the production side of the company from Athens to San Angelo, said Jackie Brown, vice president of operations."  City Council thought that's what they bid on in January 2012. 

Update 8-31-14:  MedHab's new production site is Watertown, South Dakota, as told by MedHab CEO Johnny Ross to the City of San Angelo Development Corporation.  

Farmer's Trash Hauling Nonconflict, Conflict, Nonconflict

 

San Angelo City Councilwoman Charlotte Farmer felt Republic Services/Trashaway did not need competition during the July 16 Council meeting.  Farmer made a motion denying another trash hauler the right to use city streets.  After her motion failed City Council seemed poised to grant the competing trash company's wishes.

Councilwoman Farmer asked for a recess to talk to the Mayor and City Attorney Lysia Bowling about a possible conflict of interest.  After the confab Mayor Morrison said Charlotte recused herself from the discussion due to a family relation (cousin) having ownership in a trash hauler.  Fair enough, but it seemed curious after Charlotte fought hard to defend Republic, even making a motion to keep competition out.

The Standard Times reported on today's council meeting where Mrs. Farmer sought to extend Republic's contract with the city.  What happened to the conflict of interest declared several weeks ago?  The paper was silent in this regard.  I haven't yet seen the Council meeting video, but it's a question I'll be looking to resolve. 

Scripps Earnings Call & Standard Times Paywall

E.W. Scripps released earnings on Monday.  Their conference call had several interesting revelations regarding their newspaper division, which includes The Standard Times.   Here's the state of the newspaper division:

Subscription revenue decreased 1.9 percent to $28.1 million. During the quarter, Scripps launched bundled digital and print subscriptions in 11 of its 13 markets.  More than 20 percent of subscribers established their digital accounts with full access to content on their smartphones, desktops and tablets. The rollout was late in the quarter and therefore did not impact second-quarter subscription revenue. 

The second quarter includes April, May and June.  Rather than late in the quarter an executive revealed the roll-out happened early, with most papers doing so in April and May.  The Standard Times implemented its surprise roll-out pay-wall May 1.  Also embedded in this strategy is a price increase.  Newspaper executives refused to give an average price increase to an analyst.  

Newsprint expense decreased 13.7 percent, due to lower volume and lower price.

Under questioning Scripps executives revealed 7% or half the decline came from lower volume, while the other half came from cheaper newsprint prices.   The 7% volume decline could be due to skinnier papers or fewer subscribers.  Executives said they currently have 550,000 customers with home delivery.  That represents 35% of households in those newspaper markets,  Executives said 65% of households have no relationship with Scripps, at least not a paying one.  

Scripps is "hiring and developing digital-only sales people, streamlining the digital sales process, and creating digital content." 

Executives said they plan to add 100 digital sales people, which they expect to be very aggressive in pushing Scripps content (70%) and other organization's content (30%).  They plan to add digital sales and sales management people in many newspaper markets.

Interestingly, political campaigns and health care providers/insurance companies provide profitable ads for Scripps TV and newspaper properties.  Those have been down in 2013.  Scripps counts on healthcare/insurance turning around this year and political ads being a bonanza in 2014.  

Scripps does not want to cut sizable expenses on the newspaper side.  If that became necessary, they would reduce distribution frequency.  Currently, they believe it's important to continue home delivery and publish papers seven days a week.  Their clear expectation is their new paywall with enhanced digital content will stop the hemorrhaging of subscribers.  Their plan is to grow.  

Update 8-16-13:  The San Francisco Chronicle removed their $12 a month paywall after nearly five months.  The Dallas Morning News instituted a change of its own.

Update 10-26-13:  Scripps 3rd quarter earnings call will be Friday, November 8th. It will be interesting to hear their paywall story. 

Mayor New's Other Accomplishments

The Standard Times provided former San Angelo Mayor the opportunity for reflection on his four years in office.  I expect many people have recollections of the Mayor's accomplishments.  City employees remember Alvin New for changes in the city's health benefit.

Mayor New clearly stated there was "no new money" to help with draconian health insurance increases, 34 to 58% increases for retiree and employee dependents.  Nearly 200 people dropped city sponsored coverage.  Council made this decision knowing the City had been approved for Early Retiree Reinsurance Program (ERRP) funding.  They did not allocate a penny of the expected proceeds to ease this burden.  In dealing with higher premiums the City paid 25% and employees/retirees shouldered 75% of the increase.  That same year Council increased the fee to be seen at the Employee Health Clinic to $100 per visit for those without insurance.

Mayor Alvin New and City Council again targeted health insurance   The City sought bids for an exclusive provider arrangement.  Aetna and San Angelo Community Medical Center won with an expected budget savings of $483,000.  The City passed 25% of this amount to employees, keeping the other 75%.  This arrangement's eventual savings totaled over $1 million.  Employees acutely felt the impact of this exclusive deal given over 70% had Shannon physicians.  Oddly, the city dragged its feet in updating health insurance budget numbers after this major change.

MedHab Board member Alvin New benefited from City Council changing its ethics standards for economic development awards.  New was in Australia on behalf of MedHab on January 3, 2012 when council lowered its standards.  The old rule would've required New to step down as Mayor, given his significant investment in the company, and for MedHab to wait six months to receive economic development aid.

City staff presented Alvin New as an advisory board member for MedHab. That assertion was patently false.  New served as a full fledged, fiduciary bound Board of Directors member.  New filed two affidavits with the City clerk on his MedHab stakes.  Neither were produced for the public to see.   The end result was Alvin New didn't have to make a choice, Mayor or MedHab investor/board member.  MedHab received a $3.6 million economic development incentive to eventually provide up to 220 new jobs.  Council gave the company a six year window to access funds per the agreement.

Citizens needing immunizations or treatment for sexually transmitted diseases may or may not know the role Mayor New played in drastically cutting availability for treatment.  During 2012-13 budget preparations New publicly shook down a Texas Department of State Health Services physician.  The City cut $138,000 from the budget, closing the STD and Immunization clinic.

Under New's Mayorship the City applied for a federal grant that would reinstate the STD clinic, including the purchase and renovation of a building.  The Medicaid Section 1115 Waiver grant criteria clearly state the service requested must be new and that funds not go toward an ongoing service.  The City asked for federal funding beginning October 1, 2012, having closed the clinic September 30th, the day before.  In addition, city staff are on record, in newsprint and at council ,as saying the city was still treating some citizens for STDs, i.e. the city was providing an ongoing service, albeit severely limited.

Mayor Alvin New's term, like President George W. Bush's, will be associated with several fiascoes.  Bush had Hurricane Katrina and the Financial Crisis, while New had the aforementioned MedHab and the Furniture Fiasco, the unauthorized ordering and installation of over $100,000 in Water Department furniture without Council approval.  The Furniture Fiasco contributed to Water Chief Will Wilde's resignation under an ethical firestorm, already fueled by citizen complaints regarding outrageous water bills and the hiring of Will's son Blake by Carollo Engineers for the HIckory Pipeline project.  Blake had been fired by the city and deemed not eligible for rehire.

Despite Will Wilde's numerous ethical lapses, Alvin New and three other Council members voted against an outside investigation into the Water Department, preferring it remain an inside job.

Mayor New takes pride in his impact on water.  In the midst of his term as Mayor, citizens experienced a 47.5% increase in their water bills.   Alvin New's service as Mayor is memorable in a number of ways.  Some may not recollect so fondly.

Update 10-10-13:  New is the winner of ASU's Distinguished Alumnus Award for 2013.  

City's Nonpublic Stance on Feral Cats

The City of San Angelo Animal Services Board raised the topic of feral cats two years ago.  It revisited the subject several times, but never produced a draft of new policies or ordinances for the Board, much less City Council, to consider.

City Animal Services chose to target a longstanding feral cat colony in mid-June.  Animal Control Officers threatened a community volunteer with arrest and huge fines if they continued feeding feral cats, many of which had been spayed/neutered at the volunteer's expense.  Others had been spayed/neutered with grant funds.

City staff trapped four feral cats on private property without permission from the owner and stole food bowls sitting on same private property.  The Animal Shelter killed the four cats, three of which had been sterilized with grant funds. 

Community animal service organizations quickly asked questions.  City leaders were obtuse and circumspect on the change in strategy.  They stated they had complaints and called the animals at this particular colony a nuisance.   Much of the city's actions and supporting logic are not supported by ordinance.

The document below has information produced in response to a public information request.  E-mails from Health Services Director Sandra Villareal and Animal Services Manager Julie Vrana haven't provided a consistent legal foundation for the city's intervention.  The tone of their communication indicates why there has been no change, no willingness to collaborate with community organizations on managing San Angelo's feral cat problem.

The last two slides in this document detail the public information request and the City's response to date.  

City feral cat pi request slides from jepysdad

These documents support the city's insensitivity and intransigence on this issue.  However, there is an opportunity for change and collaboration.

Community animal service organizations want one thing, space carved out to manage feral cat colonies legally and without harassment.  For the vast majority of San Angelo's landscape Animal Services can continue its "Trap and Kill" approach toward feral cats.  These groups simply want the right to manage approved feral cat colonies via "Trap-Spay/Neuter-Return-Maintain."

It's clear from e-mails that city staff have little interest in change.  However, there is a new sheriff in town.  City Manager Daniel Valenzuela could create the expectation that obstructionists become proponents, that city staff collaborate and perform the required leg work.  If that happens our community could have a shot at significant grant funds to address San Angelo's feral cat problem.

For their to be a public-private partnership, the public portion has to be willing to collaborate with the private.  The next two months, roughly the length of a cat pregnancy, will be telling.

MedHab Gets Manufacturer Award Before Product Launch

The federally supported Texas Manufacturers Assistance Center honored MedHab for “world class and next generation manufacturing practices, including innovation, workforce development, collaboration, growth and market development, sustainable practices and continuous improvement.”  CityBizList-Dallas reported:

TMAC recognizes a handful of Texas companies annually with its Customer Performance Excellence Award. MedHab will be honored August 7 at its manufacturing facility in San Angelo by U.S. Congressman Mike Conaway.

“MedHab is a wonderful example of collaboration with multiple TMAC regional centers as well as strategic partners such as Tech Fort Worth, Athens Bio-Medical Manufacturing Center, the SBA’s Small Business Development Network, municipalities such as San Angelo, other colleges and universities and the private sector,” said Deborreh Wallace of TMAC. “Working with MedHab to advance its product toward commercialization has been challenging and very rewarding; we look forward to its market success in the sports and healthcare sectors.”

During November 2012, MedHab made a strategic shift to develop new software to create a device that helps athletes and coaches determine bi-lateral equivalence of the legs. Athletes that are bi-laterally equivalent are stronger, faster and perform at a higher level. To that end, MedHab developed RPM2 (remote performance measurement and monitoring), which launches August 2013. 

One might expect San Angelo City Leaders to know more about MedHab than they recently displayed to City Council members seeking an update.  Award winning MedHab has a product launch this month.  How many of those jobs are in San Angelo vs. municipalities such as Athens?

Update 8-4-13:  Congressman Mike Conaway will be in town for the West Texas Legislative Summit, which will focus on federal immigration reform.  During this trip Conaway will sprite over to MedHab's construction facility in San Angelo to present the award.

Update 8-7-13:  MedHab's assembly site is Athens, Texas.  Surprise, San Angelo!

Update 8-8-13:  The Standard Times reported:  "The company has three full-time managers and has hired four ASU grads on a contract basis to work on software development, Brown said. The company should have a full-time technical support employee and has been working with the Texas Workforce Commission to hire five or six workers to help with distribution in September when the RPM2 goes on sale."