Friday July 7th, 2006
by: Ed Mayberry, July 7, 2006 5:07:00 am
A Sunday memorial service is scheduled in Aspen, Colorado for Enron founder Ken Lay. The 64-year-old Lay died suddenly Wednesday during a vacation in Aspen. A coroner blamed his death on heart disease. He was awaiting sentencing after a federal jury in Houston found him guilty of fraud and conspiracy charges earlier this year. A Lay family spokesperson says a memorial service open to family and friends is scheduled for 2 p.m. Mountain time Sunday at Aspen Chapel in Aspen. Another memorial is scheduled for 11 a.m. Central time Wednesday at First United Methodist Church in Houston. Former Enron CEO Jeff Skilling, who was convicted with Lay, is planning to attend both services with his wife. The Lay family is asking for its privacy to be respected. Reporters will not be allowed to attend either service.
President Bush says Ken Lay was "a good guy.'' Bush tells CNN he was shocked to hear about both the Enron scandal and its founder's death of a heart attack Wednesday. Lay was convicted in May of fraud and conspiracy in the company's collapse. He faced spending the rest of his life in prison after his October sentencing. The president says he hopes Lay's "heart was right with the Lord'' when he died. Bush had called Lay "Kenny Boy.'' He describes Lay as "a generous person'' and says he was "disappointed that he betrayed the trust of shareholders.'' Bush also says he feels "real sorry for'' Lay's widow. The president says he plans to write Linda Lay a letter offering his condolences.
Fortune magazine writer Peter Elkind, who co-wrote Enron: The Smartest Guys in the Room, which was developed into a feature-length documentary, has been following Enron events that have occurred since the book's publication. He says that includes detailing the story of Enron CEO Jeff Skilling in the aftermath of Lay's death.
"I can't imagine that it would affect his situation directly in the sense of changing how a judge might sentence him, when a judge might sentence him, how harsh the punishment might be. But, I mean it leaves him left alone as sort of the living face of Enron. And, you know, the two men were certainly vilified in the aftermath of the bankruptcy and throughout this whole period since 2001, and even Ken Lay, who had a, was quite popular in Houston until Enron went bankrupt, you know, Skilling didn't have that residue of good feeling, and if anything, there were stronger sentiments after he spoke out publicly and testified before Congress and was so critical of the government and so defensive about Enron's behavior."
Elkind says he was shocked with Lay's death, as was his co-writer Bethany McLean, also with Fortune. Both attended the four-month trial here in Houston.
"We're gonna write another, a new epilogue for the book updating all the events that have taken place since the last, since we finished writing it. And there's been a lot--there's been the trials of Ken Lay and Jeff Skilling, there's been other trials, Lay's death, of course, and then, you know, enormous settlements paid by banks to the plaintiffs' class action lawyers."
Elkind and McLean's book is published by Portfolio from the Penguin Group.
Retail gasoline prices are up across Texas for a second week in a row as crude oil prices reach record highs. The weekly AAA Texas Gas Price Survey released today found regular, self-serve gasoline averaging $2.85 per gallon at pumps across Texas. That's about five cents higher than last week--and 62 cents more than last year's average. The national average for regular, self-serve is $2.94 per gallon. That's up six cents from last week. Auto club spokesperson Rose Rougeau notes that crude oil prices topped $75 for a record high. She also notes that demand remains strong for motor fuel this summer. That's taken prices at Texas pumps within a few cents of record highs reached after Hurricane Katrina last year. The cheapest gas in Texas is found in Corpus Christi, where it's averaging $2.70 per gallon--up 11 cents from last week. The costliest gas is Houston, where it's averaging $2.93 per gallon--up four cents from last week.
The Federal Reserve's string of interest rate hikes is making it a lot more expensive for consumers to borrow against their homes. Bankrate.com says the increases have pushed the rate banks and other financial institutions charge on home equity lines of credit to an average of 8.2 percent. That's the highest reading since 8.25 percent in March of 2001. A year ago, home equity lines of credit carried an average rate of 6.38 percent, and two years ago they were priced at 4.83 percent. Consumers faced with the higher rates have several alternatives: they can pay down the lines of credit or shift to fixed-rate home equity loans, which now are carrying an average rate of 7.8 percent.
The Labor Department says employers were adding more jobs to their payrolls last month, just not as many as expected. The unemployment rate holds steady at 4.6 percent. Growth in payrolls of 121,000 jobs in June follows a revised gain of 92,000 in May. Economists had been looking for larger June payrolls growth. Wall Street had been on guard for an upside surprise in job growth, fearing that could force the Federal Reserve's hand on interest rates when the central bank meets again in early August. The Fed will have one more monthly jobs report due before the policy-setting session and will likely also be looking closely at the latest inflation data. In today's report, there was word that average hourly earnings rose one-half of one percent from May. That was a larger increase than expected.
A pick-up in hiring appears to be in the cards. CareerBuilder.com says its latest survey of hiring managers shows 47 percent plan to add staff, while just 13 percent expect to make some cuts. The uptick follows some slackness during the past few months. Some workers will be more in demand than others. They include people in health care, sales, customer service, information technology and retail. Among fields showing some softness are manufacturing and telecommunications. The survey also shows that nearly 20 percent of workers plan to change jobs in the next six months and that one in ten will do so in the current quarter.
University of Texas Medical Branch President John Stobo predicts about 720 employees will be laid off in its plan to cut 1,000 jobs, according to the Houston Chronicle. Other reductions would come through attrition and transfers. About 80 of 400 open jobs will likely be filled by those whose positions are disappearing. UTMB says most of those losing their jobs will be told by August 1st. The reduction plan is in reaction to UTMB's quickly rising costs. Patient revenue growth has been limited by those who lack health insurance or government insurance program limitations. UTMB paid consultant Navigant $1.7 million to evaluate its operations.
UTMB Galveston is ranked among the Top 50 hospitals in the country in ear, nose and throat care and treating kidney disease, according to U.S. News & World Report magazine's annual survey. For the 17th consecutive year, the Memorial Hermann Institute for Rehabilitation and Research has been named one of America's best rehabilitation hospitals. Memorial Hermann-Texas Medical Center ranked 35th in kidney disease treatment and 42nd in the ear, nose and throat specialty. The University of Texas M.D. Anderson Cancer Center is ranked second for excellence in cancer care, 5th in gynecology, 10th in ear, nose and throat and urology. The Texas Heart Institute at St. Luke's ranked 6th on the list of the nation's Top 10 heart centers. The hospital also ranked among the Top 50 in digestive disorders, orthopaedics and ear, nose and throat. Texas Children's Hospital ranks 5th among the nation's top pediatric hospitals. And the Menninger Clinic ranks 6th among leading psychiatric hospitals.
The opening of the Port of Houston Authority's $1.2 billion Bayport container terminal has been pushed to November because of design changes and technology issues, according to the Houston Chronicle. Port Authority Executive Director Tom Kornegay says the first ship is not expected to dock until November 1st. Building a longer wharf than originally planned and security and communication enhancements and the weather contributed to the delay. Construction on Bayport's first phase began in June 2004. Work on the Bayport cruise ship terminal is set for completion by next summer.
The Port of Corpus Christi today renewed its deal to ship American food to Cuba--despite U.S. efforts to tighten sanctions on the Communist-run island. Commission Chairman Ruben Bonilla and Pedro Alvarez of the Cuban food import company Alimport signed a letter of intent to maintain their trade relationship. Congressman Solomon Ortiz accompanied Bonilla on the trade mission to Havana. The Port of Corpus Christi three years ago signed its first agreement with Alimport. Officials say since then more than 100,000 metric tons of U.S. agricultural goods have moved through the port on their way to Cuba. Most U.S. trade with Cuba is prohibited under a 45-year-old embargo targeting Fidel Castro's government. But an exception to those sanctions means American food and other ag products may be sold directly to Cuba on a cash basis.
An oil rig accident near Hinton, Oklahoma has left one worker dead and two others hurt. Authorities say a malfunction sent pipe careening through the site yesterday. The well's owned by Dominion Exploration and Production of Oklahoma City and was being drilled by Patterson-UTI Drilling of Snyder, Texas. Caddo County Undersheriff Walt Brown says the afternoon accident happened at a site near Hinton, about 50 miles west of Oklahoma City. Preliminary reports indicate that piping was being pulled out of the drilling area when a brake gave way, allowing material to fall on the rig platform. Sheriff Gene Cain identified the injured as Jonathan Jones of Gracemont, Oklahoma and William Pittman of Hinton. The sheriff's office later confirmed the name of the dead worker as Andrew Lee Scott of Weatherford, Oklahoma. Calls to Patterson-UTI's offices in Texas and Oklahoma City weren't immediately returned.
The 131-room Hotel Indigo has opened on Hildalgo near Sage Road. It provides a bed-and-breakfast type environment for business travelers. The hotel's opening was delayed from last Thanksgiving because of design issues related to the building's renovation from its earlier use as the Regency Park senior living facility.
Miami-based American Ventures, which owns and manages Three Riverway Office Tower, has completed the sale of a land parcel to the Omni Houston Hotel for its expansion plans in the Galleria area. The hotel plans a spa, conference center and executive meeting facility.
Houston-based Creekstone Partners has acquired an eight-story Galleria-area office building from Diapori Realty. The 22-year-old building on Richmond is on 1.7 acres of land between Fountain View and Hillcroft, and features a two-story garden atrium and four-story parking garage.
The Woodlands-based CB&I has acquired a Beaumont fabrication shop with deepwater access to the Gulf of Mexico, according to the Houston Business Journal. The shop fabricates and transports large-scale process modules, shop-built vessels and large steel plate sub-assemblies for the oil and gas exploration and production business.
It's $320 million in attorney fees for two Miami law firms who worked on an Exxon Mobil case. A federal judge made the ruling in Miami. It's in regard to a 15-year legal battle involving Irving-based Exxon and thousands of service station dealers who sued the company. The reward is about 30 percent of the total $1.1 billion agreement awarded to the plaintiffs. The case against Exxon began in 1991 when the service stations accused the company of failing to provide promised discounts for wholesale motor fuel and fraudulently hiding its failure to pay. A jury found in favor of the dealers in 2001 and ordered Exxon to pay $500 million, but the company appealed that verdict. The U.S. Supreme Court denied Exxon's last appeal in June. By that time the payment had increased to more than $1 billion with interest.
For years, millions of people have traveled to summer retreats along the Gulf of Mexico, with many ultimately putting down roots on the coast. But a problem of the population boom is overfishing in Gulf waters. That's endangered marine ecosystems and fisheries that are the source of multi million-dollar recreation and fishing industries. Officials say efforts to rebuild the populations are under way, but many environmentalists accuse the government of lax enforcement of regulations meant to protect against overfishing. Chris Dorsett of Austin is director of the Gulf of Mexico Fish Conservation for the Ocean Conservancy. He says fishery managers in the Gulf and elsewhere have ignored the law and allowed unsustainable fishing for many important fish. Four Gulf species are still described as being overfished--Greater Amberjack, Red Grouper, Red Snapper and Vermilion Snapper. The goal is to end overfishing for Red Grouper this year, Red Snapper by 2009 or 2010 and Vermilion Snapper by 2007.
Radioshack today announced the appointment of Julian Day as chairman and chief executive officer of the electronics retailer. Day replaces David Edmondson, who resigned in February because of questions about claims on his resume. Claire Babrowski, the company's president and chief operating officer, has served as acting CEO since Edmondson's departure. Day, who is 54, most recently served as chief executive officer of K-Mart Holding Corporation, the former parent company of K-Mart. He led the company out of bankruptcy, according to a statement from RadioShack. Day will receive a base annual salary of $1 million, participation in the company's bonus plans and stock options, the company says. Fort Worth-based RadioShack operate more than 6,000 consumer electronic stores in the United States and more than 100 locations in Mexico and Canada.
Houston's William P. Hobby Airport has been selected as the top pick among U.S. travelers surveyed by J.D. Power & Associates for an Aviation Week traveler satisfaction report. With more than 8.2 million passengers served in 2005, HOU was rated under the category of Small Airports. Customer satisfaction was ranked in airport accessibility, check-in/baggage check, security check, food and beverage, retail services, baggage claim and immigration/customs control and especially terminal facilities.
Continental Airlines is ranked the highest in customer Satisfaction Among Traditional Network Carriers in North America. Respondents were asked to rate airlines in reservations, check-in, boarding/deplaning/baggage, aircraft, flight crew, in-flight services and cost and fees. Continental recently received $156 million from the sale of its Copa Airlines shares, and is contributing $75 million to pension plans.
America's next military fighter plane has been unveiled today in Fort Worth and it will carry the name: Lightning Two. The first copy is at Lockheed Martin's assembly plant, where the plane--also called the F-35 joint strike fighter--is being built. It's scheduled to begin test flights in October and be ready for use by the Marine Corps in 2012, the Air Force and Navy one year later, and United Kingdom forces in 2014. Each plane is expected to cost up to $60 million. Lightning Two is designed to replace the F-16 and several other fighters. Its name harkened back to two planes of World War II vintage and named Lightning--the Lockheed P-38 and a British fighter. Parts of the fuselage are being built in Fort Worth; Palmdale, California; and in England, with final assembly in Fort Worth.
Baker Hughes in Houston today reports the number of rigs actively exploring for oil and natural gas in the U.S. fell by seven this week--to reach 1,659. One year ago the rig count was 1,394. Texas lost eight rigs.