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‘Sunday Sit-Down’ With Jim Pennington, Former president and CEO of The Health Plan

Editor’s Note: During his several years in the Wheeling area, which he calls “one of the most rewarding periods of my career,” Jim Pennington oversaw growth at The Health Plan, and relocated its headquarters to downtown Wheeling. Pennington also had many other ideas for the local economy. Though he lives in South Carolina now, he visits his native state on occasion and during one trip, he discussed some of his ideas during a Sunday Sit-Down with us.

∫ You suggested that we focus on some key area of Wheeling to enhance what you called a “best in class” atmosphere. Would you please explain some of your ideas?

PENNINGTON: In my time there, I thought the Centre Market had great potential, and I wasn’t there when the first revitalization of that area was taken on. But the potential there was, to me, a draw for people to come into downtown Wheeling. It has a nice atmosphere, the buildings have been restored very, very nicely, and I thought it to be more than it was today, so to speak. In my vision of it, I kind of see it as a pedestrian area, which they do once a month with some of those summer concerts that they’ve had, but it could be a pedestrian area, particularly in today’s atmosphere, with outside cafe seating and a little more of a draw to that area from what it gets today.

Examples would be the types of venues that they have in the market itself. Most of the time those venues were closed, or they were advertising someone’s business. They weren’t generating activity in and out of that marketplace for food and social gatherings and things of that nature. I really felt that particularly today, with some investment from the city or economic development authority or just a grant, that could become quite a nice pedestrian area for the city, by just … blocking it off in the evenings, blocking it off at lunch time and allowing people to mill through there and generate some activity for the stores, the restaurants and the social life of Wheeling, and I think it would build out from there. That was the thought process I had around Centre Market.

∫ Something has changed there within the last few weeks. The city now owns most of the old Ohio Valley Medical Center property, which is reasonably near the Centre Market. Would that have any effect on the Centre Market, in your mind?

PENNINGTON: It depends on what (the city is) going to do with (OVMC property) and it does have an impact because it’s right there and the current administration doesn’t really have an eye on tearing anything down. But there’s still a draw, yes, more people in that area. It depends on what they do. If they turn it into a senior center or a drug rehab center or whatever. It depends on what they do with it, and that could have an influence positively or negatively.

∫ You also have some ideas involving the Marsh Wheeling building. What do you have in mind for it?

PENNINGTON: Well, one of the things that was going on there was (developer) Jeff Woda owned that building. He had purchased that building and he had looked at restoring the existing structure, as I understand it and in doing a financial analysis to make that work, or tearing it down and getting it to what would be called market rate versus low-income housing. He couldn’t make the low-income housing work … so he had proposed to basically tear the building down and use a lot of the historical components of that building — the brick and the facade and the sign on top of that building — and everything like that to make it look like, to carry the resemblance of what it was, what it looked like before — you know, an old warehouse building — but all brand new, using some of the brick and the face of it, restoring the Wheeling Marsh sign on top, keeping it kind of an icon point when you’re coming across that bridge from Ohio to West Virginia and turning that into market-rate real estate, so that a retiree that wanted to have a place in Wheeling during the summer but maybe go to Florida in the winter and had great ties to Wheeling, could live downtown and revitalize downtown with middle- to upper middle-class income levels and it would be just a husband-wife, a retiree that had kids in the area but didn’t want to maintain a large home and those types of things — but was hungry for downtown living.

With (The Health Plan) building down there and the restaurant business picking up and the number of people who were investing in properties down there, I thought that was just a natural match in continuing the revitalization and investment in downtown. I’m all for saving old buildings that can be saved and restoring those, but I’ve seen other cities that basically take the architectural look that’s there and basically replicate it … with new materials. He doesn’t get the tax credits and things of that nature, but (Woda’s plan) was going to be on the basis of about a $20 million investment into downtown of another new building, coming on the heels of what we just did.

So in my mind, from a business perspective, I’m looking at it so, now we’re bringing 500 new jobs back into downtown with The Health Plan. It’s growing. We have part of the building (at the Regional Economic Development Partnership), we have one floor of that building, with first right of refusal to take the whole building and buy it, then you have Jeff wanting to put up this other brand new building down there. The energy of that just resonated with me.

Now, the current administration wanted to save the building, but Jeff tried to do that. You know, Jeff did that project down at the Boury Lofts, and ran into some real structural challenges. He had to spend a lot more money to save that and had ongoing problems with that. To me, when you came across that bridge and either way came through the tunnel or across the bridge and got off on that exit and saw this brand new but hundred-year-old looking building, a warehouse type of thing like you’d see in New York from a lofts perspective, with people walking to and from restaurants within a block and a half, that would have been a dynamic project. … But we lost the momentum. Nothing’s happened. (Some work was in progress at the site earlier this year).

∫ Speaking of the Wheeling-Pitt building, what do you think about it? There’s a proposal (by Canton, Ohio, developer Steve Coon) to restore, repair, renovate it and use it for some residential and I think some retail use. What do you think of a parking garage to serve it?

PENNINGTON: I don’t know the current status of it. But I think the proposal that was on the table with a property across the street and building a parking garage across the street had some very significant challenges around it and the numbers did not work very well. I wasn’t involved in it to say it was a good project or a bad project. It just kind of took its course and I didn’t get involved in that. (Rigby) was trying to bring other people to the table. He was trying to work with the city to figure it out but he could never get the numbers … that really supported what Coon was saying.

To me, I’m an idea guy, but to me trying to go across the street and build a parking garage that was owned by another group of people and they got all the income off it and then it came back to them in 10 years or something like that, whatever the numbers were, the numbers that I heard just didn’t make strong business sense for the city. (That proposal has been abandoned; city officials’ last plan involved building a parking garage on property just north of the Wheeling-Pitt building).

One of the things I looked at with (Regional Economic Development Parternship Executive Director) Don Rigby and a couple of people was the old 12th Street Garage (near the Wheeling-Pitt building). So that old garage, the foundation that owned it was willing to give it to The Health Plan. You know, we could buy it for a dollar or something like that. And the concept that I had in my mind, because we were not going to have a lot of parking for our employees — we were limiting parking to maximize the building and all that … the concept that I had was to basically take that parking garage and re-engineer it so that it could be used for The Health Plan and people could park there and just kind of walk around the corner and you were within a block and a half of the (Health Plan) building and then we would do something with the employees to have lower-cost parking.

But the structure was so in disrepair that it was extremely dangerous. Concrete was falling off the pillars, etc., etc., and (Rigby) and those guys looked at me and said “Jim, this can’t even be saved.” Now, I’ve heard they were using it for something else but the question I had with the Wheeling-Pitt building was, well, if (the 12th Street Garage) was available, why doesn’t the city or economic development authority just buy it and tear it down. And then re-do parking right behind that. It’s easy to build a parking garage behind that building that could support that complex they wanted to put into Wheeling-Pitt. That’s what it was for before.

Why not tear down an old, dilapidated risk-bearing facility and put up something nice and new with the current facade? To me that would have been a cheaper deal than going across the street and creating a boondoggle for others.

∫ They have abandoned that idea. Now, they’re talking about property to the north of the Wheeling-Pitt building. I think they’re waiting for Mr. Coon to make a move before they make any commitments. On another topic, I’ve heard you have an idea for an entrepreneur center in one of the old buildings in the downtown area. Tell me about that.

PENNINGTON: Well, there are a lot of funds out there and in a couple of conversations I listened to or had with (Sen. Shelley Moore Capito, R-W.Va.), she talked about entrepreneurial funds.

There are not a lot of incubator capabilities in West Virginia, to kind of develop our own, and I thought that one of those buildings being restored would be a really nice venue to have downtown. Whether it’s feeding out of the colleges or small businesses or just the resource center that entrepreneurs could go in there, vet their ideas, work with WVU and Marshall, with resources to help them get started and maybe even retired executives to help them develop boards and get their ideas marketed, which would be a nice, energetic atmosphere for the city to have.

Creativity, entrepreneurship, just energy and being close to Pittsburgh; probably Wheeling is better suited than anyplace else in the state for that. In my eyes, it would be Wheeling, the Eastern Panhandle or Charleston, maybe Huntington, but those would be the four centers. So that was the concept there and, gosh, you could pick any building downtown and kind of restore that. It just needs to be open space with work stations, so maybe the (former Miller Furniture) building would have been great for that.

∫ Does the business and industry community work well with local government? Is there a way to improve the relationship there, do you think?

PENNINGTON: When I got there, the business community working with the city was very strong, in my opinion, and the state. And after we pretty much built the (Health Plan) building — we were almost finished with it — I offered assistance to the new administration … Working with Don and the Chamber and others trying to get a good, strong business community council, so to speak, and we just couldn’t get the energy there. …

When we did the building, we had $10 million from the state committed for roads and fixing paving and that kind of stuff. Now, they’re going to get the project, I’ve heard.

∫ Yes, $25 million now.

PENNINGTON: It has grown. (Downtown) needed infrastructure. We understood that, and to get the $25 million now is a win. I’m glad to see they got it reinvigorated.

I think the city and the county don’t really work much together. They’re two separate entities and one of the things I was asked when I vetted the idea to come downtown was would I consider The Highlands or that type of thing, and I said no … that’s not the purpose of the move. The purpose of the move was to create an economic development atmosphere in a downtown that needed it.

We support the county, of course, in all of that, but it’s kind of like it … it’s kind of odd, it’s almost like the counties fight the cities in West Virginia.

∫ What about Wheeling’s crown jewel, Oglebay Park? How can we capitalize more on it to grow the local economy?

PENNINGTON: They’re doing a lot of really great stuff up there. I like the team very much and I was asked to be on the foundation board and that gave me a lot of insight into what they’re doing that I didn’t have before. I always try to make certain that anything we did downtown, like the race that you guys sponsor, that ended up being the Wellness Weekend, that we always had Oglebay in the room and at the table, so that if they wanted to build something off of that event, they would be at the table and could do that. The same thing with the Mountain East Conference basketball tournament. They called and asked if we would be the big sponsor. I said “fine, we’ll do it, but we’re not just giving money without any input. We’re going to bring a group of people together to work on it.” Oglebay really stepped up and made a huge difference.

Sometimes I think the city government gets to a point where they want to compete with Oglebay, and I really don’t see the value with that. … I just think it has to be integrated into any conversation you have about downtown …

I’m not sure how it was in the past because I wasn’t there, but there seems to be a more collaborative approach with the new management structure with (Eriks Janelsins, president and CEO of The Oglebay Foundation and David Lindelow, president and CEO of the Wheeling Park Commission and those guys up at Oglebay. They’re really involved in a lot of things right now and I tried to get The Health Plan doing more things up there as a focus on the city.

∫ I want to drop back to something you talked about earlier, and it’s some of the valuable old buildings which, too often are very dilapidated in Wheeling. What general policy would you have toward some of those old buildings?

PENNINGTON: Some just can’t be saved. But there are materials today that you can build a building that looks like it had been there for 50, 60, 70 years. So I think if you can put some general guidelines around it — and people hate them because they feel the historic district has some many restrictions that you can’t get anything done. But if you look at Centre Market, look how nice Centre Market looks. It has criteria around it. Downtown Charleston did the same thing. It had criteria around what you needed to do. It needs to be balanced. It can’t be too burdensome that a developer can’t make something work.

So, I think that’s the balance. I think legitimately the (city) administration when I talked to them, they wanted to save everything, and there were some opportunities to tear some things down and complement what you could keep right next door with parks and those types of things. Or, like we talked about the Marsh Building. Use the material that was there to build kind of a monument to what was there and make it look like an old warehouse but the total infrastructure is all new. The AC works well, the plumbing works well the electrical works well, the windows don’t have wind blowing through them, that type of thing.

So that’s the balance you need to find, but normally it’s on the fringes. If you’re a historical person, you want to do it exactly the way it was — save all the windows — and if you’re a developer you want to be able to use new materials that are more efficient and more effective from a construction perspective. Where’s the happy medium?

∫ Let’s say I am going to pick an old Victorian building, tear it down and try to build — I think you called it a monument to what was there before — what are the construction costs for doing that as opposed to just tearing it down and throwing up some concrete block?

PENNINGTON: It’s a lot more expensive, particularly if you’re going after the (historic) tax credits.

I’ll give you a couple of examples. The buildings (in the 1400 block of Market Street) between WesBanco and (the newspaper offices). There are three. The backs were falling off two of the buildings. Those buildings there, (architect) Vic Greco had done drawings for the city 15-20 years ago to restore those buildings. They would have been beautiful. But the cost to it wouldn’t make any sense. He could still do the fronts of those buildings in the same fashion that looked like they were three separate buildings or separate buildings and make it look like they were there. Or build something brand new that would basically fit the architectural look of the period.

(Ryan and Nikki Stoker, of Arizona, have proposed rehabilitating the buildings.)

∫ During the last four months, we have talked a lot about what the new normal is going to be after COVID-19. How do you think what’s happened in the last few months is going to affect downtown Wheeling, moving forward?

PENNINGTON: I don’t know. I’m probably on a different side than a lot of people. I think it could harm a lot of cities in the sense that even The Health Plan, one can argue, 70% of the people can work from home. And we had some nurses working from home, we had some claims examiners working from home. I never liked the idea of customer service reps working from home because I wanted all of them in there with a good service culture and you don’t get that from home — at least, my opinion, you don’t get it — and you lose the culture of the company. Everyone works from home and you hire 10 new people and they don’t wear The Health Plan logo on Health Plan Wednesday — you know, when you can come in a pair of jeans and a shirt with the logo on it — you lose the culture of the company and the culture of the community is what I’m fearful of.

Along with that, just think about that. When we moved downtown, you had Tito’s (restaurant) — I’ll use him as an example — and the popcorn shop. They were nice little things, and you could sell 100 hot dogs a day or whatever it is ­– I’m making it up — and the popcorn guy was a bag here and a bag there and some commercial stuff. We bring 400 people downtown, Tito’s expanded. He’s doing 1,000 hot dogs a day instead of 100 or whatever he was doing. We’re talking to the popcorn guy about doing things for our customers and customizing things. So their business has blossomed because we were down there and got to know them. I didn’t know either one of those guys. But you get to know them and Vagabond Chef, we had him come up and cater a couple of things for legislators who came to visit and board members. Business starts to foster. With nothing downtown and no one coming into downtown, I’m concerned for downtowns.

∫ Any other thoughts?

PENNINGTON: The one thing I would say is, Wheeling, Ohio County has probably one of the best regional economic development groups in the state. Don (Rigby) and (Regional Economic Development Partnership Program Director) Craig O’Leary really know their business and they’ve worked well in the past with the Legislature. You had a lot of really good contacts down there that we had things really energized about the Northern Panhandle. I’d hate to lose that, but I would tell you that’s one of the best economic development authorities in the state.

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