14 June 2006 Vol. IX Number 12

BUSINESS

Our Paper

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RoundTable Staff

Williams Next Door Takes Family Shoe Business Into the 21st Century

By Victoria Scott

Williams ShoesWilliams Next Door, a new shoe and accessories store, opened June 7, across the hall from Williams The Walking Spirit. Owner Michael Lembeck poses with his wife, Marianne, (right), and his mother, Vivian (center), who talked about the 52-year history of the family store

It is not his father's shoe store.

Michael Lembeck's father's shoe store, the original Williams at 710 Church St., sold "comfort shoes for middle-aged ladies," he says. That was an amended description; he first referred to them as "old-lady shoes."

Michael smartened up Williams in the 90s. Now his brand-new store, Williams Next Door, 706 Church St., is stepping even farther into the world of fashion.

As Mr. Lembeck and his wife, Marianne, prepared for last Wednesday's store opening, his mother, Vivian, was on hand to trace the evolution of the store her husband founded in 1954.

After David Lembeck died in 1990, she said, her son began to phase out the Selby and Red Cross footwear that had been his father's mainstays and bring in the funk. Or, as Vivian wryly noted, "When he got out from under his father's thumb, [Michael] went berserk."

He capitalized on a new craze, annexing what became The Walking Spirit to serve the growing number of exercise enthusiasts. At the same time Michael Lembeck yielded to a self-described "inclination to funky," transforming the staid Williams into a store women – and then, men – of all ages could appreciate.

Now, where the Indian emporium The Peacock stood until late December, another reincarnation has occurred. Transformed at the hand of Evanston artist Zuleyka Benitez, Williams Next Door showcases high-style shoes, elegant jewelry and up-to-the-minute handbags.

Ms. Benitez, whose company is called Architectural Detailing, lavished the space with stonework and tile.

She is, said the Lembeck women, her own painter, carpenter and mason – as ingenious as she is creative. Taking her cue from the marble lobby framed by the store's interior windows, Ms. Benitez drew from eclectic sources to give the place a luxe feeling.
Cinderella herself would relish the antique chandeliers, pale, textured walls and glass-topped tables. "I don't think there is any place like it in Evanston," says Marianne.

It is the kind of place Ms. Lembeck, who is also a realtor, has long dreamed about – a retail space large enough to display accessories that complement the shoes. She has assembled a collection of designer jewelry: necklaces and bracelets with semi-precious stones by Chan Luu, metal pieces by Viv & Ingrid and bright-colored glass from Brazil. Among the purses is a line from France called Doggy Bagz.

The Lembecks have transported some favorite shoes from Williams, opting to combine comfort with style. The new store is now the place to find Think and Gentle Souls; Bolos and the buttery soft shoes of Robert Zur are chic additions.

Their new Re-Mix line finds inspiration in the attic, replicating the footwear of the 1940s in Mexican factories. Fashionistas should love Re-Mix's bi-colored spectators, its Mary Janes and open toed styles, with their vintage straps and chunky heels.

There is even a glamorous solution – an array of silk slippers, cloud-soft and colorful – for those who have to shed their glass slippers after midnight.

"It's hard for retailers these days," says Vivian Lembeck. But 52 years after the family store opened, it is growing again. Forging their new identity in a downtown her husband would scarcely recognize, the Williams shoe stores now employ a third generation – the college-age Lembeck granddaughters.

(continued)

Plan Commission Rejects Proposal for Kendall College Site

The Plan Commission makes recommendations to City Council, which has the ultimate vote on the development.

On Feb. 15 Smithfield Properties, which purchased the Kendall site more than two years ago, proposed building 16 single-family homes and eight duplex units. Smithfield would tear down all the buildings on the site, including Wesley Hall, the administration building, which originally served as the Swedish Theological Seminary.

There would be single-family homes of 3,900-5,700 square feet each along Orrington Avenue and Colfax and Lincoln streets. The duplex units – in two buildings fronting Sherman Avenue and two on the interior of the development – would each be about 3,200 square feet. Mr. Buono estimates the market price for the single-family homes to be $1.6 million, with the duplexes selling for about $900,000 each.

The single-family homes would reflect the architectural styles and building materials of the neighborhood houses, said Mr. Buono, and while there would be similarities, they hope that no two homes will be alike.

In return, Smithfield requested a change in zoning from U1, university, to a combination of R1 and R3 and for variances in requirements for height, side-yard setbacks, rear-yard size and frontage.

That proposal replaced a denser one, composed of 48 townhomes, with R-4, or multi-family zoning. Neighbors in the area have been advocating for R-1 zoning there, which would permit only single-family houses.

After the decision of the Plan Commission, Robert Buono said he was "very surprised."

Given the emphasis by both Alderman Cheryl Wollin, 1st Ward, and neighbors "on a plan that conforms as closely as possible to R1, it was surprising to everyone that the Plan Commission called for a ‘more creative' approach that presumably would involve R4 zoning to preserve Wesley Hall and build townhouses along Orrington Avenue," Mr. Buono said.

"Based on 2 1/2 years of discussion with the community, R4 doesn't seem like something the community would accept," he said, "but that may change. ... My thought at the moment is that I don't know what is going to happen."

Evanston Plan Commission members, in a straw vote at their meeting May 31, came out 4-1against the Smithfield Properties plan. They are scheduled to make a formal recommendation to City Council on the issue tonight.

Most commissioners seem to be just as dissatisfied with neighbors who have opposed the project as they are with the project itself.

"I've got a problem with what's going on here," Commissioner Larry Widmayer said of neighbors' demands that the entire property be re-zoned R1, for single-family homes.

"A half-block south of this site we have an R5 neighborhood," Mr. Widmayer said, adding that he found the talk about preserving the purity of a single-family area "very elitist."

"What have citizens living a half block south of you on Sherman Avenue done to destroy your neighborhood?" Mr. Widmayer asked the neighbors. "I find your depiction of multi-family housing despicable."

Commission Chairman Albert Hunter said he had grown up at 725 Milburn St., a block north of the Kendall site.

"I remember the sheer fact of a diversity of structures in the area, because Kendall was there, and the close proximity to Northwestern and other institutions. That definitely was not an R1 feel. I'm troubled by the ‘purity' notion here," Mr. Hunter said.

Looking at the Orrington Avenue streetscape, he said, you see institutions facing one another – Roycemore School on one side, the Kendall buildings on the other. "That does not have the feel of R1 to me," he added.

Commissioner Stuart Opdycke said Wesley Hall, the original 1907 seminary building that became Kendall's administrative offices, should be the centerpiece of development on that block. "Any proposal that doesn't incorporate re-using that will not get my vote. Wesley Hall is an important part of our heritage," Mr. Opdycke said.

During the hearing City staffers said that under R1 zoning Wesley Hall could be declared a unique use, but it could have no more than four units, each with a minimum of 2,000 square feet, unless the zoning code was amended.

"If it requires re-zoning to save Wesley Hall, then so be it," Mr. Opdycke said, "I'm not all caught up in spot zoning."

"We hoped some creative proposal would come forward for this wonderful opportunity," Commissioner James Woods said. "From my perspective what we have is not creative. The proposal doesn't take advantage of the resources available on the site for a sustainable design. It should take advantage, not just of the administration building, but even the 1950s and 1960s Kendall College buildings. And I'm disappointed in the absolute insistence on R1 by the neighbors."

Associate Commissioner David Galloway said he thought an adaptive re-use of almost all the buildings on the site could have been accomplished – one that could win environmental awards.

He suggested that a better plan would convert Wesley Hall to condos and place townhouses on the rest of the Orrington Avenue frontage, with single-family homes on the rest of the site.

Commissioner Hunter said what distinguishes Evanston from other communities "is what I refer to as an ideological commitment to the notion of diversity. That shouldn't mean just diversity ‘over there,'" he said, "but diversity throughout the fabric of Evanston.

"That's what troubles me about the hue and cry for R1," he added. "An over-commitment to R1 may override some of these other kinds of values. Despite all the signs," he said, "I don't think R1 should be the defining question for what to do."

Commissioner Coleen Burrus said she disagreed with the other commissioners. "I don't think every neighborhood has to have multi-family zoning. When we look at planning, we have to be respectful of how the City was laid out and not mix things too much," she said.

Commissioner Opdycke urged the neighbors and the developer to "not burn any bridges yet. Press on and I think we can get something done that everybody can live with."

A representative of the neighbors said they had not started out three or more years ago demanding R1, but that the developer had said he was going to clear-cut the block, and former 1st Ward Alderman Art Newman said that forcing a re-zoning to R1 was the only way to gain some control over the project.

Alderman Cheryl Wollin, 1st Ward, said, "I don't think the neighbors are going to accept townhouses, and I don't know that the developer wants to maintain Wesley Hall.

"I think everyone was surprised at the Plan Commission's direction," she continued. "I didn't see that coming, and I don't think anybody did."

Bill McClure of 12 Milburn Park, a leader of the neighbors' group urging R1 zoning for the site, said, "We've always asked that the developer preserve Wesley Hall, always suggested that they consider getting density for the project by putting multi-family housing there."

He added, "We don't think building townhouses on the property is appropriate, but that doesn't mean that there isn't some possible configuration of something that could work out.

"The plan Smithfield presented was unacceptable, and we said we prefer single-family homes," Mr. McClure said. "Whether there may be a variation based on some ‘creative' way of approaching the property as the Plan Commissioners suggested remains to be seen until a specific plan is formulated.

(continued)
CIF and IDHA Provide Housing at Roszak's Sienna Development

The Illinois Housing Development Authority announced $225,000 in grants and loans that will allow five individuals with special needs living in Cook County to afford their first homes. The funding is made possible through the State Affordable Housing Trust Fund.

Jane Doyle of CIF (Center for Independent Futures) said Mr. Roszack found CIF. She said, "We had a group of families needing accessible housing; they needed an elevator and adaptations. We worked with Mr. Roszack and the contractor.... It's a wonderful situation for us." The five individuals hope to move into the first Sienna building by mid-summer, she said.

Two not-for-profit agencies, the Evanston-based (CIF) and the Housing Opportunity Development Corporation, will help administer the funds.

Each homebuyer will receive a $40,000 interest-free, 30-year loan; income-eligible homebuyers will be required to contribute a minimum of $1,000 toward a down payment on the condo.

All five will each receive an additional $5,000 cash grant from the State Trust Fund, which will be used to provide homebuyer education and assist with down-payment and closing costs.

The special-needs homebuyers will have daily contact with support staff for job skills and personal development resources and 24-hour emergency support from a live-in CIF staff member known as a "community builder."

CIF was responsible for finding and pre-qualifying applicants as first-time homebuyers either living with a disability but capable of living independently or willing and motivated to convert to independent living. They must earn less than 50 percent of the area median income – in Cook County, $26,400 for a single-person household.

"Governor Blagojevich's 2003 executive order identified low-income people with disabilities as one of the six priority populations who are most in need of quality affordable housing," said Kelly King Dibble, IHDA Executive Director.

The Sienna development is now under construction between Ridge and Oak avenues and Clark and Church streets.

The Business of Medicine

Evanston Hospital, one of three hospitals operated by Evanston Northwestern Healthcare (ENH), has served the Evanston community since its 1894 founding. From the beginning there were strong ties to the community. The hospital was founded in the late 1800s in the wake of the spread of typhoid and smallpox in the area and has had strong community ties ever since. Since the 1920s, its doctors have had a collaborative arrangement with Northwestern University, and now, according to ENH, most ENH doctors are on the faculty of Northwestern's Feinberg School of Medicine. This installment of a series of articles about Evanston Hospital looks at the business of ENH.

By Mary Helt Gavin

As health-care costs increase, hospitals struggle to find a middle ground between the demands of sound business practices that protect the institution and providing levels of care that protect the community. Financial considerations are a cold reality of modern medical practice, and Evanston Hospital, like many other hospitals across the country, is no stranger to concerns about the bottom line. Evanston Hospital President Ray Grady says the hospital has three functions: providing health care, conducting research and teaching the practice of medicine.

The business of ENH
Some contend that hospitals, including Evanston Hospital, are being run as businesses, even though they receive tax exemptions as not-for-profits. They say the business model, with its emphasis on the bottom line, places economics before health care, shortchanging the patient.

ENH's form 990 for fiscal year 2004 showed revenues of $811 million and expenses of $788 million, with excess revenues of $22 million. For fiscal year 2003, ENH had excess revenues of $3.7 million, and for fiscal year 2002, ENH showed a deficit of $20.5 million.

Dropping/ consolidating less profitable programs
More and more, local hospitals are being consolidated under the aegis of a health-care network. Just as Evanston Hospital is a part of the ENH group, St. Francis Hospital is one of the eight Resurrection hospitals. Although consolidation can help defray some major hospital costs, it provides a justification for closing or relocating less-profitable services, to the detriment of the host community.

Evanston Hospital has shut down its level-1 trauma center and transferred its adolescent mental health services and adult substance-abuse services. Mr. Grady justified both decisions, saying there had been too few level-1 traumas to justify the expense of keeping the required staffing at Evanston Hospital round the clock, and that St. Francis Hospital, only a few miles away, still maintains its level-1 trauma center, while Evanston Hospital maintains a level-2 trauma center.

About the relocation of mental health services, Mr. Grady said, "We took a system-wide approach and deployed our resources where we could most effectively serve our patients. We have the adult program at Evanston Hospital and the adolescent program at Highland Park Hospital."

Both decisions drew criticism from the community. Some felt there should be two trauma centers, one north and one south; others simply felt the decision was driven by economics and not by a consideration of the needs of the community.

But Christine Rybicki of St. Francis Hospital told the RoundTable St. Francis has had no trouble handling the extra cases. "We've seen a little bump in level-1 trauma cases, but we are able to handle all the cases and continue to provide the same level of care," she said.

Fire Chief Alan Berkowsky appeared to agree that trauma cases are well handled: "We're fortunate to have two fine hospitals in Evanston, and the City is so small that [emergency personnel] can get to either hospital in a matter of just a few minutes."

Yet, Harvey Saver, assistant director of mental health services for the City, said decisions to curtail mental health services in Evanston does harm the Evanston community. He said neither Resurrection, which operates St. Francis, nor ENH considered the effect on the Evanston community in making their decisions about mental health programs: "When St. Francis relocated its behavioral health unit [one of its mental health services], that was all right, they said, because the service was still provided within the Resurrection Healthcare Network. Similarly, when Evanston Hospital moved its in-patient substance abuse and its adolescent psychiatric services from Evanston, they could say the network was still providing those services. ...The focus for each of them was on their network, not on the City of Evanston," Mr. Saver said. He added that uninsured and underinsured residents are less likely to seek services provided outside of Evanston.

Pressure on doctors
Within the ENH network there are two kinds of doctors – independent physicians with hospital privileges and physicians employed by ENH. Ideally, the patient would not know the difference, says Mr. Grady.

However, some doctors – current and former ENH doctors – told the RoundTable they feel the administration is trying to make all doctors who work at Evanston Hospital become employees of ENH and to squeeze out those who remain in private practice but have privileges there.

"It's a power grab," said one physician, who added the administration has ways of making things uncomfortable for doctors who do not work for ENH. Doctors who are ENH employees will help protect the patient base, he said, because there is little chance that an ENH employee will refer a patient to a doctor outside of the network.

"The Gadfly," an underground newsletter circulated at Evanston Hospital, says some physicians have left ENH because of dissatisfaction with its internal workings. "Physicians … have left ... out of frustration," a recent edition lamented.

"Our aim is to provide a hospital experience for our patients and their families that will create a high likelihood of their recommending ENH to their friends and family," says Hospital President Ray Grady.

Keeping the customer satisfied
ENH, like most health-care organizations, takes the market approach to customer satisfaction. "Evanston Hospital and ENH make a significant effort to garner feedback from our patients when they come to us for care. Our aim is to provide a hospital experience for our patients and their families that will create a high likelihood of their recommending ENH to their friends and family," says Mr. Grady.

Press Ganey, an independent outside firm, sends out 11,000 patient surveys per quarter and receives about 25 percent back, Mr. Grady said, adding, "Press Ganey compares our patients' responses with 1,028 other hospitals across the country. The most important measure of patient satisfaction is the ‘likelihood of you recommending this hospital to others.' For that measure, we perform at the 80th percentile. …Our goal is to be above the 90th percentile, and we are constantly striving to improve the patient's experience at ENH."

Yet, anecdotally at least, not all customers are satisfied. Unsolicited, three former patients of ENH contacted the RoundTable to describe their dissatisfaction with Evanston Hospital. Moreover, the eighth edition of "The Gadfly" stated, "We have more and more patients commenting that Evanston Hospital is not what it used to be."

Nurses in demand
There are 650 registered nurses on staff at Evanston Hospital, as well as another 150 who serve in "various management and advanced practice roles," said Mr. Grady. The nurse vacancy rate at Evanston Hospital is about 4 percent; in the Chicago area the rate varies between 2 and 9 percent, he said.

As with customer satisfaction, the sufficiency of a nursing staff may vary with the observer. It is generally regarded that there is a shortage of nurses nationwide and that nurses are in high demand.

"The Gadfly," an underground newsletter circulated at Evanston Hospital, stated, "We have more and more patients commenting that Evanston Hospital is not what it used to be."

A doctor who recently left Evanston Hospital on good terms after nearly three decades told the RoundTable he would never let a family member spend the night alone in any hospital. "Even at Evanston Hospital there are not enough nurses to go around when patients need to go to the bathroom or have some difficulty," he said.

"The Gadfly" recently advocated that nurses be represented in policy-making decisions, as had been done previously. "What could be better at establishing the importance of nursing to the functioning of the hospital and to show that ENH recognizes its importance and has given it a seat at the table in its decision making? …Not all benefits can be measured in dollars and cents."

Salaries for top administrators
But dollars and cents do keep the hospital afloat, and major hospital corporations pay large salaries to top administrators.

According to figures provided to the RoundTable, Mark Neaman, CEO of the Evanston Hospital and its sister ENH hospitals, Glenbrook and Highland Park, received a salary of $954,119, plus $51,049 in benefits, in 2004. That same year Jeffrey Hillebrand, chief operating officer, received $530,677, plus $48,463 in benefits; and Mr. Grady, $430,526, plus $46,983 in benefits.

"...Cook County Commissioner Larry Suffredin says that such high salaries are not justifiable for a not-for-profit hospital because they use up money that could otherwise be spent on health care for the uninsured or the under-insured."

Though requested, ENH neither verified nor corrected these amounts, nor did it provide updated salary information. However, it did provide a statement from Mr. Grady: "The independent board of directors of Evanston Northwestern Healthcare believes that strong executive leadership is essential for ENH to achieve clinical excellence and financial stability and thus fulfill its mission of providing high-quality care and community service. Essential to achieving these goals is the ability to attract and retain a chief executive officer capable of managing an extraordinarily complex integrated delivery system."

As the Evanston leader for health care at Korn/Ferry International, Evanstonian Tom Giella recruits hospital administrators. He told the RoundTable the salaries were "well within the range for hospital administrators. ENH is a billion-dollar enterprise, and a typical CEO's salary would be about 1 percent of net. Mark [Neaman] is well known and highly regarded in the health-care system. Mr. Grady and Mr. Hillebrand would be expected to get about half of what Mr. Neaman receives. Based on their reputations, the size of the ENH enterprise and the complexity of their jobs, they earn their keep."

Taking the opposing view, Cook County Commissioner Larry Suffredin says that such high salaries are not justifiable for a not-for-profit hospital because they use up money that could otherwise be spent on health care for the uninsured or the under-insured. "There's only so much in the pot, and they're taking from it for their own high salaries instead of spending it on the poor and uninsured," he told the RoundTable.

For the past two years The Gadfly has tweaked, and sometimes criticized, ENH officials for certain policies and has accused them of caring more for the bottom line than for providing quality health care to all, including the poor and indigent.

While The Gadfly's criticisms may sting more than those from other sources, many of them are not far from the criticisms and concerns raised by Attorney General Lisa Madigan and others who believe that hospitals are not doing enough for the poor and uninsured to justify their tax-exempt status.

For 11 of the past 12 years, Solucient – a company that ranks hospitals – has named Evanston Hospital one of the country's top hospitals. Among the reasons for this distinction are the hospital's low mortality rate and its efficiency in delivering quality, and often complex, health care.

The next article will look at how much charity care is provided to the poor and uninsured in Evanston and examine the impact of what the Attorney General is requesting.