» Subscribe Today!
More of what you want to know.
The Daily News
X

Forgot your password?
Skip Navigation LinksHome >
VOL. 6 | NO. 41 | Saturday, October 05, 2013

Daily Digest

Print | Front Page | Email this story | Comments ()

Government Shutdown Felt in Myriad Ways

In a meeting with a lender in Baltimore this week, the chief economist of FTN Financial – the capital markets subsidiary of First Tennessee Bank – was told they are suspending mortgage lending for the duration of the government shutdown.

That’s because Fannie Mae and Freddie Mac want income verification on every loan from the IRS, but only IRS workers processing tax payments are considered “essential” and still on the job during the shutdown, FTN Financial chief economist Chris Low said. He added there are also problems getting flood insurance.

In other spillover effects from the shutdown, this week’s jobs report is expected to be delayed because of government employees who normally handle that work being furloughed.

On the floor of the U.S. Senate Wed., Oct. 2, U.S. Sen. Bob Corker, R-Tenn., warned against Republicans focusing too much on the “shiny object” in the form of the president’s health care law in the rush to negotiate a solution to the shutdown.

“I’m concerned that so much focus has been placed on the ‘shiny object,’ the health care law, as it relates to the (continuing resolution) that our focus has been taken off the gains that we’ve made in controlling spending,” Corker said. “Sometimes when people find themselves in a box canyon or in a place that is difficult, people begin doing things that are not in the best long-term interests. My message to the House would be: Whatever you have to do to cobble together 218 votes to pass a bill relative to the (continuing resolution) and the debt ceiling, please do not negotiate away the hard-won gains that we were able to put in place to reduce spending and to help make our country stronger.”

City Attorney Morris Recognized for Service

City attorney Herman Morris Jr. is the 2013 recipient of the International Municipal Lawyers Association’s Joseph I. Mulligan Jr. Distinguished Public Service Award, which recognizes a local government attorney for achievements in local government law.

The association presented the award at its 78th annual conference.

Morris, the first attorney from Memphis to receive this award, was given the honor following the $7.5 million-dollar settlement of a city-county lawsuit against Wells Fargo over discriminatory lending practices; challenging the state’s voter ID law to allow Memphis residents to use library cards for identification; settling the legal battle over Beale Street; and launching an effort to sue the owners of blighted, neglected and abandoned properties.

“It is always an honor to be recognized by your peers,” said Morris. “I am humbled, but know this award was due to the hard work of our fine city of Memphis legal department.”

The nonprofit International Municipal Lawyers Association is based in the Washington, D.C. area and claims more than 1,400 members across the United States and Canada.

Magna Bank App Allows Remote Check Deposits

Magna Bank has joined the list of Memphis financial institutions that let customers snap photos of checks to deposit them in the bank.

Mobile deposit at Magna is now available through a new version of the bank’s mobile app. The new service lets customers use their mobile phone or tablet to a take a photo of a check, which is then deposited into the customer’s account.

Customers won’t be charged for the service. Other features in the new version of Magna’s app include viewing balances, transferring funds, searching account activity, paying bills and searching for bank and ATM locations.

The app can be downloaded for iPhone or iPad from Apple’s App Store or for Android devices – except Kindle tablets – from the Google Play Store.

Former City Official Pearson Remembered

Claude Pearson, the director of sanitation services and labor negotiator for the city of Memphis, was remembered Wednesday, Oct. 2, in a funeral service.

Pearson, 73, died Sept. 28.

He was an appointed city official under Memphis Mayors Henry Loeb, Wyeth Chandler and Dick Hackett. His posts included serving as director of sanitation services when Memphis went to curbside garbage collection. Prior to that, sanitation workers had picked up garbage in the backyards of homes.

Pearson was also integrally involved in labor negotiations in the mid-1970s, including bitter negotiations with police and fire union leaders in 1977, followed by the strikes by police and firefighters in 1978. Pearson was also on the city’s side of the bargaining table in the resolution to the strikes.

Pearson’s service as an elected official was as an alderman in Bartlett.

September Jobs Report Delayed by Shutdown

The Labor Department says it will not release the highly anticipated September jobs report on Friday because the government remains shuttered.

The announcement Thursday was mostly a formality. A postponement of the most critical measures of the economy’s health was widely expected after the shutdown began. The report includes the unemployment rate and the net number of jobs employers added to payrolls last month. The department said no alternative release date has been set.

Economists forecast that the economy added 180,000 jobs last month and the unemployment rate stayed at 7.3 percent, according to a survey by FactSet.

Average 30-Year Mortage Rate Drops to 4.22 Percent

Average U.S. rates on fixed mortgages fell for the third straight week to their lowest point in three months, as a decline in consumer confidence and the onset of the government shutdown forced rates down.

Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan dropped to 4.22 percent from 4.32 percent last week. The average on the 15-year fixed loan declined to 3.29 percent from 3.37 percent.

Both are the lowest averages since early July.

Rates began to fall last month after the Federal Reserve held off slowing its $85-billion-a-month in bond buys, which have kept rates low. They fell further this week as the shutdown prompted investors to sell stocks and buy Treasury bonds. Mortgage rates tend to follow the yield on the 10-year Treasury note.

The 10-year note traded at 2.63 percent Thursday morning, down from 2.71 percent on Sept. 23.

The Federal Housing Administration, which guarantees about 30 percent of U.S. home mortgages, says that if the partial shutdown continues for an extended period and the agency’s funding runs out, it wouldn’t be able to continue approving loans.

In that case, “We do expect that potential homeowners will be impacted, as well as home sellers and the entire housing market,” the FHA said in a contingency plan.

Buyers wouldn’t disappear. But some would linger in limbo until the government reopened and a backlog of applications cleared.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

FDIC Releases Latest Market Share Figures

The Federal Deposit Insurance Corp. has come out with its latest annual ranking of the customer deposit share among banks, and not much has changed in the Memphis metropolitan statistical area over 2012.

The numbers are current through June, making them only a snapshot of a moment in time but still useful for comparison purposes.

The same four banks have the four largest chunks of customer deposits in the area. First Tennessee Bank has the most, followed by Regions Bank, then SunTrust Banks Inc. and then BancorpSouth Inc.

That’s the same order they were in on the FDIC’s 2012 list.

Their percentages of the customer deposit share in the area are generally the same, with each of them having changed up or down by less than one percentage point.

Total deposits in the market are $23.5 billion this year, up from $23 billion last year.

Cadence Bank Offers Aid to Government Employees

Because of the federal government shutdown, Cadence Bank is offering one-month payment extensions to its clients who are U.S. government employees, including military service members.

Cadence will let current qualified loan customers employed by the government postpone their October loan payment and waive the associated fees. Cadence CEO Sam Tortorici said it’s because the bank wants to help mitigate the hardship the shutdown may have on government employees.

Memphian Selected to Lead Tennessee Association of Realtors

Memphis Realtor Pat Beech has been selected 2014 president-elect of the Tennessee Association of Realtors. Beech was elected and installed at the state association’s 94th annual convention, held recently in Destin, Fla.

A 28-year veteran of the real estate industry, Beech is broker-owner of Arlena Enos Realtors. She is a past president of the Memphis Area Association of Realtors and a past Realtor of the Year for the local association.

Beech has held leadership and committee positions throughout her career at the local, state and national levels, including serving as president of the Tennessee Real Estate Educational Foundation and chairwoman of the Tennessee Association of Realtors Political Action Committee.

The Tennessee Association of Realtors is one of the largest professional associations in Tennessee, with approximately 19,000 members statewide.

Council Gives Conditional OK to Southbrook Funding

Memphis City Council members approved Tuesday, Oct. 1, $1.5 million in capital funding for renovations to Southbrook Mall in Whitehaven that are contingent on a legal opinion from the city attorney’s office on whether the use of the bond money amounts to a private use that is prohibited by the federal tax code.

The mall is owned by a nonprofit group, and the capital funding is from funding for improvements to the Elvis Presley Boulevard streetscape from Brooks Road on the north to Shelby Drive on the south.

If the Internal Revenue Service ultimately finds that using $1.5 million for roof repairs and similar items is a “private use,” it could endanger the tax-exempt status of the bonds for both the mall and the streetscape project.

The council also reversed the Land Use Control Board in its approval of the two-lot Tate Grove subdivision on what is now a one-home lot on the northeast corner of Mendenhall Road and Minden Road in East Memphis. A nearby homeowner appealed the decision to the council, saying the setback for the two homes is not in keeping with standards in the neighborhood and should not have been granted a waiver on those standards. The council agreed.

In other action, the council approved the establishment of an inner-city economic development fund to be administered by the Economic Development Growth Engine. The fund begins with a balance of $508,000, which has accumulated over several years from a 5 percent fee on personal property taxes abated through payment-in-lieu-of-taxes incentives for economic development expansion and relocation projects. The 5 percent fee is up to a maximum of $50,000.

EDGE president and CEO Reid Dulberger said the annual amount coming into the fund will vary, but that $100,000 a year would be a “good year” for the fund.

Wunderlich Securities Grows its Ranks

Memphis-based Wunderlich Securities Inc. has added five equity capital markets professionals to its ranks.

With those hires, Wunderlich’s equity capital markets division now has 18 senior research analysts, covering companies in six industry verticals – energy, financial services, diversified industrials, technology, health care and consumer.

The division now also has 17 senior salespeople, nine traders/sales traders and 20 senior investment bankers.

Shoemaker Financial Adds Two to Staff

Shoemaker Financial has added two new registered representatives to its Germantown office.

Jacob Dotson will focus his practice on young married couples and young professionals. Ellen Stewart will focus on young professional women, young families and the military.

Shoemaker is a full-service financial planning and investment management firm founded in 1978.

US Companies Add 166,000 Jobs in September

U.S. businesses added just 166,000 jobs in September, only slightly more than the previous two months. The lack of improvement in hiring, along with the threat of a prolonged government shutdown, could help persuade the Federal Reserve to delay scaling back its stimulus.

Payroll company ADP said Wednesday that private employers added just 159,000 jobs in August and 161,000 in July. Both were lower than the previous estimates.

The figures are taking on greater importance because they may be the only measure of the September job market for some time. The Labor Department will have to delay its September jobs report, scheduled for Friday, now that it appears the government shutdown will go past Wednesday.

The ADP data suggest that the economy is growing too slowly to rapidly boost hiring. Economists forecast that it expanded by a 1.5 percent to 2 percent annual rate in the July-September quarter, down from a 2.5 percent annual rate in the April-June quarter.

At the same time, hiring has slowed, according to the government’s more comprehensive employment figures. Employers have added 155,000 jobs a month in the four months through August. That’s down from an average of 205,000 in the first four months of the year.

The partial government shutdown could slow economic growth, particularly if it lasts more than a week. A prolonged shutdown may lead the Fed to delay any reduction in its purchases until next year.

Memphis International Airport Partners With German Counterpart

Memphis International Airport, home to the FedEx Express super-hub, and Leipzig/Halle Airport in Saxony, Germany, DHL’s European hub, have formed a strategic partnership.

Airport officials said the partnership will allow the two airports to exchange information and best practices, and possibly attract new business.

“Ultimately, one of our most important goals is to expand international cargo business and attract major cargo carriers,” said Scott Brockman, chief operating officer of the Memphis-Shelby County Airport Authority. “This regional cooperation with Leipzig/Halle Airport will allow each of us to learn more about how the other does business and put these lessons into practice.”

Memphis International Airport is the second-largest cargo airport in the world, while Leipzig/Halle Airport is Germany’s second-largest and Europe’s fifth-largest cargo airport.

“Connecting these two important air cargo hubs allows us to offer better services to and maintain the highest-quality standards for our customers,” said Markus Kopp, CEO of Leipzig/Halle Airport and its parent company, Mitteldeutsche Airport Holding.

Counterpart Communication Design Picks Up National Awards

Memphis-based Counterpart Communication Design has won four awards at the 2013 American Graphic Design Awards, hosted by “Graphic Design USA,” a print news publication for the graphic design community.

Counterpart’s awards were for a holiday card design, Counterpart’s 2012 client Christmas stationery, St. Louis Catholic Church’s Women of the Word mark and the brown box/green globe logo for International Paper Co.

The awards are open to all types of companies in the graphic design industry, including advertising agencies, graphic design firms, corporations, institutions, publishers and others. More than 8,000 entries were submitted.

Counterpart is a marketing communications firm founded in July 2002.

City Auto Fights Sickle Cell Disease

City Auto helped in the fight against sickle cell disease in September, holding its inaugural Madison Hargrove Memorial Blood Drive. City Auto collected 21 units of blood at the event, enough to help up to 63 local patients.

The drive was held in commemoration of Madison Hargrove, the daughter of City Auto employee Eric Hargrove and his wife, Lisa. Madison Hargrove died from sickle cell disease complications at the age of 6 in August 2012.

“It has been our desire to preserve Madison’s legacy and ensure that she is always remembered, while at the same time continuing to advocate for the sickle cell community,” Lisa Hargrove said. “This vision has now become a reality with the development of this blood drive in remembrance of Madison. Madison received blood transfusions every three weeks starting at age 2 to protect her from strokes. It was because of the generous blood donors that she was able to receive her transfusions as scheduled, keeping her illness under control.”

City Auto also sponsored the fifth annual City Auto Mike Conley Bowl-n-Bash benefiting the Methodist Comprehensive Sickle Cell Center, which provides a preventive outpatient clinic and the city’s first dedicated emergency infusion unit for adult sickle cell patients.

Memphis has the second highest sickle cell population in the nation, with over 1,700 adult sickle cell patients. September was Sickle Cell Disease Awareness Month.

EdR Reports Increased Occupancy at School Start

Memphis-based EdR experienced an increase in occupancy to begin the academic year.

EdR, one of the nation’s largest developers, owners and managers of collegiate housing, announced Monday, Sept. 30, it opened the 2013-2014 lease term with 94.1 percent occupancy, up from 91.1 percent occupancy a year ago. The company also said same-community net rental rates increased 2 percent over last year.

“We are excited about the strong results we achieved this leasing season,” said Christine Richards, senior vice president and chief operating officer. “With our high-quality portfolio and the focus of our strong management team, we were able to deliver industry-leading leasing results.”

EdR will release property-specific leasing data in the company’s third-quarter earnings release, scheduled for Oct. 28.

Terminix Joins Forces With Home Goods Maker

Memphis-based Terminix has announced a strategic initiative with London Luxury, a leading manufacturer of innovative and premium home goods.

The purpose of the arrangement between London Luxury and Terminix, the world’s largest pest-control provider, is to develop a line of products to protect consumers against pests. Initial offerings include bedding and travel products to protect consumers and their possessions from insects such as bedbugs and fleas.

Terminix also recently expanded its services to include a variety of retail offerings such as the Terminix ALLCLEAR line of mosquito solutions, and London Luxury will start to partner with national retail chains to launch the new Terminix products.

Four West Tennessee Sites Declared Shovel-Ready

Four industrial sites in West Tennessee have been certified by the state as shovel-ready “Select Tennessee Certified Sites.”

The designation by the state Department of Economic and Community Development means the sites have met standards that site consultants consider essential when advising companies looking for a new location.

The sites in West Tennessee that made the list released Monday, Sept. 30, are Dyersburg Rail Site at 4500 Tenn. 211, the Interstate 40 Advantage Industrial Park Site in Brownsville, Milan Commercial Complex Garball Site in Milan and the Sandstone Village Site in Jackson.

The designations are awarded after site selection experts at Austin Consulting and Foote Consulting Group review applications to see that they meet international standards that minimize risk to developers and ensure the sites can be developed in the shortest timeframe possible.

Tennessee Company to Fund Housing for Mentally Ill

The UnitedHealthcare Community Plan of Tennessee is providing $1 million in grants to increase housing options for Tennesseans with mental illness.

Officials say the funding will help support development of appropriate housing for people who need a place to live after being discharged from a mental health facility.

UnitedHealthcare will give $400,000 this year and $600,000 in 2014.

According to the National Alliance on Mental Illness, more than 245,000 adults and 65,000 children in Tennessee live with serious mental health conditions.

The Tennessee Department of Mental Health and Substance Abuse’s Creating Homes Initiative estimates nearly 190,000 Tennesseans with mental illness are in need of some sort of housing assistance.

Women’s Foundation Honored for Philanthropy

The Women’s Foundation for a Greater Memphis has been recognized by the U.S. Department of Housing and Urban Development and the Council on Foundations for its philanthropic efforts.

The foundation is one of 10 recipients of the Secretary’s Award for Public-Philanthropic Partnerships, which honors philanthropic organizations for their innovative public-private efforts designed to address housing and community-development challenges.

The Women’s Foundation joined forces with the city of Memphis, the Memphis Housing Authority and national nonprofit Urban Strategies to implement Urban Strategies Memphis HOPE, a public-philanthropic partnership aimed at breaking the cycle of intergenerational poverty for Memphians.

Since 2004, the partnership has secured $88 million in grant funds under HUD’s HOPE VI program for the community revitalization of three public housing locations.

They include Lamar Terrace/University Place, Dixie Homes/Legends Park and Cleaborn Homes/Cleaborn Pointe at Heritage Landing. The transformation of the city’s’ languishing public housing became the signature project of the partnership.

The Women’s Foundation raised and leveraged partnerships totaling more than $22.2 million in public and private resources over the past seven years to build a two-generation model for community support services for women and children.

Shelby County Jobless Rate Rises in August

The latest unemployment figures the state of Tennessee has released show Shelby County’s jobless rate in August hit 9.7 percent.

For the numbers behind that percentage, out of Shelby County’s labor force of 433,090 people in August, 42,170 were unemployed.

One year earlier, in August of 2012, Shelby County’s unemployment rate was 9 percent. So the county’s jobless picture worsened by almost a percentage point over the past year.

Last month’s jobless figures also mean no sustained progress has been made toward bringing down Shelby County’s unemployment percentage in 2013.

In the months of both January and August, a little more than 42,000 people were unemployed, with the jobless rate reaching 9.7 percent in January as well as during the most recent reporting period in August.

EDGE Awarded Funds for Economic Development

The Economic Development Growth Engine for Memphis & Shelby County was awarded $3.7 million in federal funding to help create jobs, support economic diversification and encourage entrepreneurship.

The funds come through the U.S. Department of Commerce’s Economic Development Administration and will be supported with EDGE funding.

The money will help create a multimillion-dollar loan fund to provide Memphis-area small- and medium-sized businesses flexible financing and low-cost capital to spur entrepreneurship, innovation and job creation in Shelby County.

US Consumers Boost Spending 0.3 Percent

U.S. consumers increased their spending slightly last month as their income grew at the fastest pace in six months. The figures point to only modest economic growth in the July-September quarter.

Consumers’ spending on goods and services rose 0.3 percent in August, the Commerce Department said Friday.

That number is up from a 0.2 percent gain in July, which was slightly more than the 0.1 percent improvement reported last month.

Income rose 0.4 percent in August, the best gain since February and up from a 0.2 percent July increase. Private wages and salaries rose 0.5 percent, while the government wages and salaries rose 0.2 percent.

The government figures would have been higher if not for forced federal furloughs that reduced wages and salaries by $7.3 billion.

Consumer spending drives 70 percent of economic activity.

Many analysts say the increases are not enough to accelerate economic growth in the third quarter from the 2.5 percent annual rate in the April-June quarter.

Sign-Up For Our Free Email Edition
Get the news first with our daily email


 
Blog Get more from The Daily News
Blog News, Training & Events
RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 72 218 10,440
MORTGAGES 91 293 13,620
FORECLOSURE NOTICES 0 43 2,687
BUILDING PERMITS 0 393 24,700
BANKRUPTCIES 62 184 10,076
BUSINESS LICENSES 25 62 3,798
UTILITY CONNECTIONS 90 338 14,895
MARRIAGE LICENSES 10 68 3,235

Weekly Edition

Issues | About

The Memphis News: Business, politics, and the public interest.