Q&A: Mike Varney

By Richard N. Velotta

Saturday, Jan. 1, 2011 | 3 a.m.

Mike Varney has a two-word answer about what ails Nevada — the economy.

When the chambers of commerce of Las Vegas and North Las Vegas were on parallel paths in search of new CEOs last year, the Las Vegas Chamber went to the East Coast for its most recent CEO, but the North Las Vegas Chamber didn’t go as far — it grabbed Varney, who spent nine years as vice president of marketing for the Las Vegas Chamber.

Varney, a frequent speaker on sales and marketing to local, state, regional and national chamber organizations across North America, was named president and CEO in April.

Before taking that position, Varney, a Wisconsin transplant, served as CEO of Nevada Corporate Headquarters, a local incorporation and registered agent firm.

As president and CEO, Varney is responsible for all aspects of the chamber’s operations including strategic planning, product development, government affairs, communications, research, finance and member services.

He spoke with In Business about North Las Vegas’ business community and the challenges that await the 2011 Nevada Legislature — and about the economy.

IBLV: You’ve been on the job for about eight months. Were there any surprises in the transition?

Varney: There were no big surprises with the possible exception that having been through a number of recessions before, just how stubborn and unrelenting this recession seems to be. It’s reached deeply into our community. Until I assumed this role I didn’t really have quite the full appreciation for the level of intrusion that this recession has had at so many different levels of our community — the vacant storefronts and the companies that have downsized, many of them you wouldn’t think would be in this position that are hanging on. Everybody’s looking for a way to get to the end of the month, the next payroll, the end of the year, what have you. Thinking right now tends to be very, very short term. It’s survival before we get into full-fledged recovery. Of course, most of the news stories these days are about a very, very slow and protracted recovery. But recovery and some upward bias to our economic curve certainly is preferable to what we’ve got right now. I don’t know if that’s a surprise, but it certainly is an eye-opener, just how intrusive this recession has been.

How does your philosophy and leadership style differ from your predecessor, Sharon Powers?

Well, I really can’t say that I know her leadership style or management style all that well to draw accurate comparisons. I can, obviously, tell you about my style. My style is, in a phrase, “We’re all in this together.” I’m not really big on titles, I’m not really big on turf battles. We all pull on the same oar here and information is freely exchanged and shared. We all know the organization’s mission, we all know our role in getting that done. We all cooperate and support one another. Maybe it’s a cliché, but it really is the classic team effort here. I think that style promotes buy-in and ownership rather than having some genius in the corner office pontificate about how smart he is and hand things down to staff members who then don’t share the same buy-in. It’s not their goals, it’s that other guy’s goals. So I think it’s very much a participatory culture that we have here. I like to hear laughter in the hallways. We’ve got four people doing the job that 10 used to do. This chamber is not untouched by downsizing. Our people, with one exception — the person who had to handle the phones — were at the table when the board met for the 2011 planning session. It affects them, and they needed to hear from the board, and they needed to express their opinions to the board. So everybody who is in a leadership position here — department leadership right up to the chairman of the board — was present, and we came away with a common mission. That’s my management style.

Unemployment and the economy are obviously the biggest challenges facing Southern Nevada today. What can the chamber and its membership do to help fix these problems?

Our approach is to fix as many little things as we can to provide one more business development opportunity, to provide one more piece of information, to provide one more key contact. To do all the things that are just basically the building blocks of developing and having a healthy business. We just pay attention to the details here, the basic operational functions. We just put together, with the help of a brand new volunteer committee, an entire one-year events calendar that includes an excellent mix of learning opportunities, of relationship-building opportunities, which our research tells us that our members value that as much as anything else that we do. The role of the chamber is the great convener — bringing together buyers and sellers and people who can help with relationships and who can provide referrals and have an awareness of a company’s business so that one day that person’s in a position to recommend that person to a potential client or customer. Everything you can think of that’s in Business Operations 101 we’re paying attention to. Our small-business advisory board, which is one of thee new committees we have, has four parts to its mission. It’s to help our members make money, help them save money, help them build a better and broader net of relationships, and then we classify the fourth one as simply knowledge transfer. Small businesses don’t have the resources to go hire consultants, so they rely on an organization like the chamber to bring consultants to them through a new program of webinars that we’re launching this year through our in-person events — our breakfasts, our luncheons and so forth. It’s a wonderful collection of information and really unique speakers who really give people a broader base of understanding of how business works and how our community works. I would summarize by saying that those four things — make money, save money, knowledge transfer and relationship building — are really at the core of helping businesses get through this economy. When we’re all smiling and someday when the economic winds are blowing in a little different direction, we’ll talk about expanding beyond that, but right now it’s back to the basics.

Diversifying the economy is viewed as a necessity to solving many of our problems. What ideas are you proposing to diversify the economy?

There’s no question that we need to diversify this economy. It’s one of the most undiversified economies in the country, certainly for a city this size. Yet all around us there are the opportunities and the resources to expand in a variety of different areas in all the common industrial categories that I’m sure you’ve heard of a thousand times from the experts on this subject. But to get there, the one missing link seems to be education. The workforce component seems to be a question mark. I don’t think there’s any question about that. The buzzword today that we haven’t heard as much as we’ve heard recently is economic diversification and right on the tail of that is how are we going to provide an educated workforce? We have a nonprofit 501(c)(3) charitable foundation whose only mission is to contribute to educational improvements. We’ve adopted some at-risk schools to address elementary school needs. We’re working closely with a volunteer group called Teen Entrepreneurs to support them so they can teach children, many of whom are at-risk children, how business works. We’re looking at some economic literacy initiatives. I’m not sure it’s quite taught at the level that it needs to be in the public schools. But even if they do have a good curriculum there, you can’t teach children those basic tools of how to manage their household budget and their personal finances enough. We have a Leadership North Las Vegas program, which is all about taking current middle- and upper-tier executives and enriching them with leadership skills with a much higher level of awareness about how our community operates. From a variety of different perspectives, we’re approaching that central education concept to try to improve it. I’m working with a consortium of education leaders and chamber and business leaders to work on a program where educators and those interested in education can come together and have one voice and promote a higher level of education. A similar model has been adopted by the medical community, and it’s been very successful for them. So we’re looking at that closely. So we need to diversify and the missing link seems to be workforce development.

Should the chamber be aligning itself more with some of the goals of the Nevada Development Authority and the Nevada Commission on Economic Development to bring more companies to Las Vegas?

Some of our board members and I serve on some of those other committees that have come together. Our chamber and other chambers have a voice in how those committees and independent bodies’ programs unfold. So we try to be among the many voices certainly representing what we feel is most important to our constituents in our community. We have four core public policy positions that we’ve staked out, and at the top of the list is the education initiative where we are really calling on the state and any educational body — local, School District, what have you — to get serious about improving education. I think so far in the 14 years or so that I have lived here, I’ve seen a tug-of-war between the leaders of the School District, the teachers, the teachers’ union. This tug-of-war is going on and the children are in the peanut gallery watching it. There needs to be a return to the focus on the child and a focus on discipline in the school, having the learning materials that they need, on having the levels of accountability up and down the line and realignment of the Clark County School District. The district has been called top heavy since I got here 14 years ago. Well, if it is top heavy, we’ve got a new superintendent, let’s do something about that. But we better have everybody aligned and focused on the children if we’re going to make a difference. I’m not so sure that those political directions are carved out yet.

Are you optimistic that with the new leadership that we have in the state that some of the funding necessary for both K-12 and higher education are going to be met? Has your message been heard?

I think it’s been heard. I think everybody’s on board that it has to happen. Whether your on the left side of the aisle or the right side of the aisle, no matter where you are, I think the message that we’re 50th in education and that’s an embarrassment to our state has been heard by everybody. I think the problem right now is not accepting that fact. I think we’re beyond denial. We’re into the acceptance phase and we’re into the phase of, “Well how do we go about doing that?” Knowing about it and doing something about it are two different things. So I think right now we’re in crunchtime, the eleventh hour. It’s time to either get serious about this or get some people who can be serious about it. I think the Legislature will find a way to fund it, but I don’t want to see money thrown at an issue the size of education without the corresponding levels of accountability and totally rebuilding the whole model of how we’re going to measure educational improvement. Everything I’ve ever heard from people who are way smarter than me on education is that the taxpayer — although in this economy, it may not be an easy sell — is generally more comfortable paying for education as long as they know they’re getting something for their dollar. I think so far, we’ve had plenty of voices saying, “Spend more on education.” I don’t think many people feel that if we do that, that they know what they’re going to get for their dollar. You can’t have one without the other. You can’t just throw money at it and expect something to change unless there’s a plan to make some serious changes. Some of our board members and I were fortunate enough to be asked by the firm that did the recruitment for the current school superintendent what needed changing. What did education in Clark County need to look like to be successful? There were four of us that met with the search panel, and we were very open about it. It wasn’t but about three or four weeks later that we were asked to have that same visit with members of the School Board, including (former School Board President) Terri Janison. They essentially asked the same questions, and we gave them the same answers. I think there’s a fear among a lot of people that even though we have a new superintendent that nothing’s going to change. I hope those fears are misplaced. I wish the new superintendent great success, but he’s got to be an agent of change, and we’ve got to get out of 50th place and start climbing the ladder.

Are you encouraged that having met with Terri Janison that Gov.-elect Brian Sandoval will have some positive things for education since she’s now on his staff?

We didn’t know that then, but with this appointment by the governor is certainly a plus for education with Terri’s background and her awareness of things here. But again, it’s going to come down not to what education used to look like, but what it’s going to look like and small changes aren’t going to make it happen. They’ve got to be big changes.

Outside the economy, unemployment and diversification, what other issues are on the chamber’s plate and what is being done to address them?

You’ve certainly nailed all the big ones. Public policy is a never-ending melodrama. We’ve got some serious issues with how the state and our county and local municipalities spend the taxpayer dollar. I make no bones about the fact that in prior years when our economy was going due north — no pun intended — there were governmental bodies that made some really bad deals with some unions as if those kinds of economic growth periods were going continue forever. Obviously, a lot of people bought houses thinking the same thing. Fast forward a few years and we’re finding that we’ve got a very different economy, but we have the same labor agreements. To get us through this economy, everybody has to be a player. The private sector takes great exception to the fact that there are certain special interest groups that basically are hot-potatoing the bad economy to everybody else except themselves. I don’t think that this state or any other state is going to get its act in order until the PERS (Public Employees’ Retirement System) and PEBS (Public Employees’ Benefits System) thing is brought under control. I know there have been some small advances there, but there have to be some serious changes there, too. We can’t pussyfoot our way into big changes. We’ve got to take some bold steps and make some very big changes at the local level and at the state level in those areas. So we’re going to watch and see where the state Legislature looks for money. If they don’t look for money where they should be, then the taxpayer and certainly this body are going to be very reluctant to say, “Let’s spend some more money on state or local services,” because they can make some changes in the way they do business we think and find some revenue. So that would be one thing, PERS and PEBS and the whole public employee union issue. It’s really hard to get past the day-to-day basics, and I’m sorry that I’m not just a fountain of wisdom on these other things, but our focus is so much on the individual members and being their unpaid assistants and their silent assistants to move them to the next payroll period or the end of the month. I don’t mean to be dramatic about that, but it’s the new reality. I heard about a construction company last week that had 150 employees in 2007 … 25 today — and they’re just barely hanging on. Then there’s this chamber. We had 10 employees, now we’re doing the same work, maybe more, with four. So these are the new “normals.” I heard somebody the other day say that “break even” is the new profit margin. There are all these little clichés going around, but there’s some reality behind all that. Whenever I do public speaking, I always tell people that when I see a vacant storefront, I always imagine the personal pain that’s behind that vacant storefront because somebody borrowed against their 401(k), somebody borrowed from Uncle Fred or somebody mortgaged their home. They found some money someplace to live the American dream of owning their own business. A lot of people did that with the best of intentions, and the economy basically just pulled the rug out from underneath them. So not only do we have the vacant storefront, maybe that translates into a foreclosed home, maybe that translates into a family that’s living in a very different way or very different place in our community than they were or that they intended to. So that pain goes pretty deep and that’s an unseen, unfelt side of the economy. It’s not just that the business didn’t work out, it’s the ripple effect of all that and you can’t sit at this desk in any chamber and not feel that. You have to feel that.

What do you view as North Las Vegas’ biggest strength as a center of business and commerce? What is its biggest weakness?

I think the biggest strength — and it’s going to take us awhile to realize it — is that we have more developable land in North Las Vegas than in any other municipality in Clark County. When the day returns when new businesses are popping up and companies are opening up a satellite office or a headquarters in the valley, North Las Vegas is going to be a very attractive place for them to develop their land needs. Frankly, I have to tell you that the level of outreach and the connection between the city of North Las Vegas and the North Las Vegas Chamber of Commerce is great. I’m thrilled to death to be working with the governmental leaders we have today. We’re not going to agree on everything, but I have worked with and had outreach from the city and done outreach there to the point where I feel that this is a very pro-business community. I’m not suggesting that other communities aren’t pro-business, this is the community I’m closest to.

Mayor Shari Buck has been quite an advocate for business.

Yes, and the City Council has demonstrated that with some of its voting patterns. Some of the conversations I’ve had, public and private, tell me that we have leadership that gets it. They’re not sitting in a separate arena watching businesses and families go through what they’re going through. They’re in among them, they know what’s going on and they’re fully prepared, within reason, to do whatever is necessary to be a force to change the economy in North Las Vegas. So I would say the developable land and the pro-business city leadership are two of the biggest things. We’ve got some zoning things here with Apex and the industrial corridors. There really isn’t a lot of that type of industrial activity, maybe a pocket or two in Henderson and some other places, but this is the place companies are going to go if they make things, simply because of the nature of our business zoning here and the companies that already occupying those storefront zones. The biggest negative … I can’t think of anything that’s unique to North Las Vegas. I think the negative are the things we’ve already talked about — having an educated workforce and turning the corner on this god-awful economy.

A casual observer views North Las Vegas as a sea of warehouses and industrial properties. True of false?

False. I would encourage that casual observer, and I know there are a lot of them, to take a half-hour or an hour and grab an economic development map from the city, which you can get online and go look at the development that is already in place — the new veterans’ hospital, for example — and drive through the neighborhoods. There is a kaleidoscope of neighborhoods in North Las Vegas. The older section tends to be the lower socioeconomic area. It’s the side of town that faces Las Vegas, so maybe if you go through the central core of the city that may be the section you drive through first and that may become your initial impression of North Las Vegas, but you’ve got to keep driving. You’ve got to see the beautiful residential communities that have been developed all over this city and see the industrial corridors because there are some really thriving industrial operations going on, many of them decades-old traditional businesses in our community. And then the outlying areas, the Apex-Capex area — nobody drives through and there’s not much to see, but what’s there has a real role in our local economy. It’s the growth area out near the vets’ hospital, the medical periphery that’s going to go around the vets’ hospital, not many people know much about that. Not many people are aware of the Fifth Street corridor, which already has begun downtown and is going to connect up to the 215 (northern Las Vegas Beltway), which will bring all kinds of economic opportunity along that corridor. There are just some pockets of this community that I guarantee you that 90 percent of the people who live in the valley have never seen. To the casual observer, put a couple of gallons of gas in the tank and see the full community.

How does North Las Vegas set itself apart from Henderson?

Other than geographic? That’s a good question and nobody’s ever posed it to me. I think the industrial base and the business base of the two communities have some similarities. You’ve got Timet and Basic Metals in their industrial section. They’ve got an older downtown and they’ve done a wonderful job in their central city, something North Las Vegas is beginning. The economy isn’t doing us any favors there. Some of the things that are planned for our downtown area and are actually already done, Las Vegas Boulevard North coming into the central city, has got some very nice amenities. They’re very nice and a new city hall is going in down there. Both cities have done a good job. Henderson may be a little ahead of us in time, but both cities have done a wonderful job of urban redevelopment in their central core areas. Henderson, I think, had a head start on North Las Vegas developing its residential communities. They have a number of very nice residential communities, but so does North Las Vegas. Our better communities are farther away from the beaten path unless you’re on 215, than Henderson’s are because when you go down that 215 corridor you’re really in the middle of a lot of those new residential communities out there. I think we have some of the same components in our community, they’re just located visually and geographically in different areas, so they’re experienced in a little different way. Beyond that, I don’t know what I would say. I’m sure there are some other minor differences.

Tell me about Las Flores Shopping Center development in the downtown area.

It’s a 33-acre plot of raw land right down in the central city, not far from Civic Center Drive and the new city hall that is going in. It’s going to be a Latino-oriented multiuse area with lots of retail, restaurant, hospitality and entertainment and it’s being patterned after a similar development in Dallas. It really becomes a tourism attraction and a cultural attraction, and it’s going to be something unique in our community. The company that bought the land, Montecito Commercial, is waiting for the economy to turn the corner as so many other developers are. That’s going to be a wonderful addition to downtown and a beautiful facility once it’s finished. The counterpart development in Dallas did exactly what the city fathers hoped it would do. It became a destination celebrating culture with restaurants, entertainment and so forth. We’re looking forward to the day they can break ground.

Besides education and the economy are there other big issues ahead for the 2011 Legislature?

Well, reapportionment is going to be huge. That’s no secret to anybody. Home rule once again is on the radar screen. I’m not sure the state wants to give it, I’m not sure the municipalities want it. It’s going to be interesting to see how that all unfolds. It’s going to be all about the money and where it comes from. The cities are bracing for having their treasuries looted again by the state, and the state is obviously in the position to do that because it can. These problems just run downhill and, of course, at the bottom of the hill is the taxpayer. Whether you’re paying the local community or your paying the state, you’re still paying. It’s going to be an interesting chess match to see how all that comes down to what they settle and when they walk out of there after the 33rd special session. It’s going to be interesting to see what that looks like. We’ve been given commitments by some of our local Assembly representatives, Marilyn Kirkpatrick at the forefront of that, to provide our membership with updates via conference call. We’re thrilled with that and we think the world of Marilyn here. She certainly is a dedicated North Las Vegas resident and we’re very proud of her. We have great representation up there this year and frankly when you look at the leadership positions, the committee leadership and the leadership on both sides of the Legislature, North Las Vegas is strongly represented this year with (Assembly Majority Leader) John Oceguera (D-Las Vegas, a North Las Vegas assistant fire chief), (Sen.) Steven Horsford (D-Las Vegas) and Marilyn Kirkpatrick. So we’re looking for very good things and strong representation. But our state representatives are still up against it. They’ve got to find, depending on who you listen to, $3 billion that we don’t have right now and maybe $5 billion, depending on how things shake out. If only the economy turns the corner, some of these problems will be lessened. But we’re not there yet.

What bills will the North Las Vegas Chamber be looking at with particular interest? Business tax proposals? Repeal of minimum-wage laws?

Anything involving business will be on our radar. I don’t mean to oversimplify this but the big-picture things that are going to have the heaviest impact, like on the budget whether they’re able to find expenses to cut, whether they’re able to find the revenue in a way that is as nonthreatening as possible. You can’t keep taking whacks at the golden goose and the golden goose is business. It’s business that employs people, people have paychecks, they have life choices, their children have better opportunities, but it all springs from business. If you make it tougher to do business and you make it tougher to do business in North Las Vegas or Nevada versus someplace else, there’s a ripple effect to that. Anything that has an adverse effect on business we’re going to look at very, very closely. But I think like many other chambers have already expressed I’m sure, we’re looking at what we get for our money. If there are taxes coming down and it’s going to be same old, same old for results, we’re not in. We’ll fight that all the way. We’ve already covered education, but we’re going to look at that because we want better education, we’re on record for supporting better education, even if it costs a little more. Again, it’s not just throwing money at it. That’s the easy part. What does the taxpayer, the community, get for its dollar? That’s what we’re going to be looking for.

Most chambers of commerce have developed a reputation as opposing tax increases. Is this going to be the position going forward or will the chamber moderate its position?

I hope we’re not alone on that and I don’t think we are. The usual response for taxes is, “Well, if you need more money, tax the other guy.” Of course, everybody’s saying that, and nobody’s pointing the finger at themselves, they’re pointing their finger at other people. Nobody wants higher taxes. Higher taxes are certainly not going to be a plus for the economy, which is already struggling, and the local families are already struggling. Nobody can afford to pay more taxes. The state’s got to pay its bills, that’s a reality. I think it’s up to our legislators to find a way to improve efficiencies and look creatively for solutions: privatization. I know there are special-interest groups that look at privatization like it’s got three eyes. Privatization has been used across the country at state and municipal levels to save money and improve efficiencies. So we’re going to be watching to see what the state does in the way of privatizing some of its services. What can be cut? Everybody thinks their program is vital, and I’m sure some are, but maybe not all of them are. Business and families have, for the last three years, have had to cut back dramatically, and they know all about cutting. We’re going to look for the state to cut. The state will say, “Well, we’ve already cut.” Obviously, it has. But I’ve got a feeling it hasn’t cut as much as the private sector and families have. So we’re going to be looking for those cuts and those creative avenues to improve efficiency and cut costs before we feel good about any kind of tax increase. If there is a tax increase, we’re going to want to know what we’re getting for our money.