Crain's Detroit Business, June 20, 2022 issue by Crain's Detroit Business

CONVERSATION: Tony Saunders on Fathead’s future under his ownership. PAGE 30

Staffing solution? Amid burnout, health care turns to technology PAGE 8

CRAINSDETROIT.COM I JUNE 20, 2022

A sobering lesson for EV startups Electric Last Mile’s failure is a reality check: Making cars is hard BY KURT NAGL

As Electric Last Mile Solutions Inc. prepares to liquidate under Chapter 7 bankruptcy, the Troybased company’s rollercoaster ride is a sobering lesson for startups and investors in the EV space, according to industry observers. ELMS excited investors with its concept of electric last-mile deliv-

ery vans, reaching a $1.4 billion market value shortly after it started trading a year ago. But it soon was confronted with a harsh reality: making cars is hard. “You can attract a lot of capital, but eventually you have to produce a car or van or truck, which is very hard to do and expensive,” said Steven Wybo, senior managing director at Birmingham-based Riveron.

“It costs billions of dollars. They were kind of doomed from the start unfortunately.” The company, founded in 2020, filed for bankruptcy in U.S. District Court in Delaware last Tuesday. Its stock has lost nearly all its value from the $14 peak it achieved shortly after going public via SPAC merger. See ELMS on Page 28

WHAT’S IN THE FILING: ELECTRIC LAST MILE OWES MORE THAN $50 MILLION. Page 28

Urban Delivery electric vans on the production line at the Electric Last Mile Solutions facility in Mishawaka, Ind., in September 2021. | BLOOMBERG

SEWN Growing Detroit apparel manufacturing industry takes lead on sustainability, innovation | BY MINNAH ARSHAD

Farm, alliance examine potential opportunities BY DUSTIN WALSH

While Detroit has been recognized as the Motor City for the last century, another manufacturing industry has been growing over the last decade. Small apparel manufacturing businesses have popped up around the city and nearby suburbs and are taking on big issues. As most fashion brands are importing products from factories overseas, the remaining pockets of American apparel making largely remain in the Carolinas, California and the Pacific Northwest. However, industry leaders in metro Detroit say the area’s businesses offer a fresh perspective of what apparel manufacturing could be, rather than a continuation of what it has been. “I think that we can develop this region as an ethical Silicon Valley for apparel manufacturing,” said Jennifer Guarino, founder and CEO of Detroit-based nonprofit Industrial Sewing and Innovation Center.

Michigan’s marijuana industry continues to bloom since recreational use was legalized three years ago. Sales in the state totaled nearly $1.8 billion in 2021, and there are now more workers in the cannabis industry than there are electricians, lawyers and electrical engineers combined. The jobs at marijuana grow operations are laborious and detailed, but require little skill and pay well in the entry-level field, most averaging $15 per hour or more plus health benefits. But, as is common across all Michigan industries, a labor shortage persists. Doghouse Farms Michigan, a national brand with a 25,000-square-foot grow operation in Detroit, is hoping to buck the trend by tapping into a different labor source — adults on the autism spectrum.

See SEWN on Page 26

See MARIJUANA on Page 29

CEO Brenna Lane works at Detroit Denim Co. in Detroit on June 15.

SUSTAINABLY

NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Can pot jobs help employ adults with autism?

NEWSPAPER

STARTING ON PAGE 14

NEED TO KNOW

NATIONAL RECOGNITION

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT

Crain’s wins 7 awards in business journalism competition

` WHITMER REJECTS PROPOSED MUSKEGON AREA CASINO

` WARDA PÂTISSERIE OWNER WINS JAMES BEARD AWARD THE NEWS: Warda Bouguettaya, owner of Warda Pâtisserie in Detroit’s Midtown, was named outstanding pastry chef by the James Beard Foundation. The shop at 70 W. Alexandrine St. is known for pastries inspired by the owner’s travels throughout Algeria, France and Asia. The other finalists were Barda, nominated for Best New Restaurant, and Omar Anani of Safron De Twah for Best Chef in the Great Lakes region. Barda, led by Chef Javier Bardauil, opened in June at 4842 Grand River Ave., as the first authentic Argentinian-inspired restaurant in Detroit. Saffron De Twah at 7636 Gratiot Ave., serves modern Moroccan dishes. WHY IT MATTERS: The James Beard Awards are considered the top honors for chefs and restaurants in the United States. Detroit has had many finalists and semifinalists in recent years, and just being nominated can raise a restaurant or chef’s profile to star status.

THE NEWS: Gov. Gretchen Whitmer on Wednesday rejected a Michigan tribe’s proposal to build an off-reservation casino resort in the Muskegon area, saying the Biden administration should have given her more time to decide or indicated the prospects of another tribe’s request for federal recognition. The governor’s decision came 18 months after the Trump administration blessed the Little River Band of Ottawa Indians’ request to conduct gambling at the site in Fruitport Township. The tribe currently operates a casino on its reservation in Manistee, about 70 miles away. WHY IT MATTERS: The decision came amid opposition from tribes that operate casinos in western and mid-Michigan as well as the Grand River Bands of Ottawa Indians, which is seeking federal acknowledgment.

` FIRE DESTROYS HISTORIC DETROIT LGBTQ+ BAR THE NEWS: A fire broke out at a longtime popular LGBTQ+ club Tuesday causing extensive damage, according to fire officials. The Woodward Bar & Grill in Detroit’s New Center area is likely “a total loss,” according to Detroit Fire Department Chief James Harris. There was no one inside the building at the time of the fire and no

injuries were reported. WHY IT MATTERS: Woodward Bar & Grill is reportedly Detroit’s oldest LGBTQ-serving establishment, which gained popularity in the 1960s when there were few choices for the gay, transgender and queer community.

` DETROIT MUSEUMS MILLAGE WON’T MAKE 2022 BALLOT THE NEWS: A millage to support the operations of the Charles H. Wright Museum of African American History and Detroit Historical Society won’t be on the August ballot. After failing to gain passage of enabling legislation this year, the museums are pushing their bid for operating millages in Wayne and Oakland counties back to 2024.

` Crain’s Detroit Business has won seven awards in a national journalism competition among business news outlets. The awards span reporting, writing, design, digital newsletters and photography. Recognized by the Alliance of Area Business Publishers at its annual awards program Saturday night with gold, silver or bronze awards were: ` Gold, Best Front Page, “Swimming in Plastic.” ` Gold, Best Coverage of Local Breaking News, Dustin Walsh, Beaumont-Spectrum merger coverage. ` Gold, Best Investigative Reporting, Annalise Frank and Chad Livengood, “Hard Stops: How metro Detroit’s fractured transit system makes inequities wider.” ` Silver, Best Recurring Feature, Jay Davis, “Small Business Spotlight.” ` Silver, Best Use of Photography/Illustration. ` Bronze, Best Specialty E-Newsletter, Amy Elliott Bragg, “Saturday Extra.” ` Bronze, Best Overall Design. ` Bronze, Best Newspaper.

WHY IT MATTERS: The museums were working on a bid to put a 10-year millage in the two counties on the August ballot, but the bill stalled following objections by Oakland County lawmakers.

Bloomfield Hills

Nic Antaya's portrait of former Detroit firefighter Rodney Parnell was among the work honored with an award for best use of photography and illustration.

Birmingham

* Bloomfield Hills

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FINANCE

REAL ESTATE

Rising interest rates another jolt to mortgage industry BY NICK MANES

The home at140 Edison St. in Detroit was built in 1908 and Henry and Clara Ford lived at the home from 1908 - 1915.| NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

‘AWARE OF THE HISTORY’ A Henry Ford home in Detroit goes on the market BY ARIELLE KASS

Jerald Mitchell would sometimes come home from a long day of work, trudge up the stairs with his hand on the banister and feel buoyed by the fact that decades prior, the home’s first owner had taken the same path. “There are times when you’re particularly aware of the history,” said Mitchell, who said he thinks of those first owners — Henry and Clara Ford — “almost every day.” “I never considered it our house,” he said. “It was always Mr. Ford’s house, and we were the stewards.” After nearly 40 years of stewardship, Mitchell and his wife, Marilyn, are looking for the next generation of caretakers. They’re planning to sell

the house, at 140 Edison St. in Detroit’s Boston-Edison district, and move into assisted living in Ann Arbor. The couple, both former Wayne State University professors — he in the medical school, she in the department of humanities — intend to list it this week for $975,000. Mitchell is anxious about selling, he said. After the years he spent improving it, caring for it and advocating for it, it will soon be someone else’s responsibility — and there’s no knowing if they will take the same level of care.

A piece of history The Mitchells moved to Detroit from Texas in the 1970s to be part of

the city’s renaissance. They bought a historic house, Mitchell said, and went to work restoring it. When a few years later the Edison Street property became available, Mitchell said he felt compelled to preserve it, too. Getting there took some effort. The house was owned by the Temple of Light, a group that Mitchell said combined Christianity and astrology. The Canadian magazine Maclean’s reported a decade ago that the Rev. Florence B. Crews and her husband, O. James Crews, who was known on local radio broadcasts as the “Voice of the Planets,” read horoscopes for pay and “walled in the fireplace, hung heavy curtains in the See HENRY FORD on Page 25

Jerald Mitchell inside his home at 140 Edison St. in Detroit. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

The largest single interest rate hike in a generation, announced last week by U.S. central bankers, is all but assured to serve as another jolt to an already beleaguered mortgage lending industry. Metro Detroit lenders including Rocket Companies Inc. and United Wholesale Mortgage, among the nation’s largest home mortgage lenders, have seen their lend- Farner ing volume and profits decline significantly since the boom years of 2020 and 2021, when interest rates were at rock-bottom levels, below 3 percent starting in the second half of 2020. The rising rate environment, coupled with various other macroeconomic factors, bring little as far as “good news” for mortgage companies, according to industry experts. The lenders, however, continue to strike an upbeat tone even as profits decline and stock prices take a hit. Historically, there has not been a direct correlation between the interest rates set by the U.S. Federal Reserve — which is the rate it costs banks to borrow — and mortgage lending rates, which are a reflection of the U.S. Treasury rates, noted Guy Cecala, executive chairman of mortgage industry trade publication Inside Mortgage Finance. However, the two different rates have now “become more of a correlation than (ever),” Cecala said, noting that current economic conditions have investors fleeing from both the equities and treasury markets, leaving the two rates to often rise and fall in unison. See RATES on Page 28

ENTERTAINMENT

Movie theaters turn to privacy pods, fancy seats to lure patrons BY ANNA FIFELSKI

In an effort to get people back to the movies, MJR Theaters is bringing a new seating concept that prioritizes privacy for patrons. The “VIP Seats” will be launching at MJR locations at the Brighton Towne Square Cinema and Southgate Cinema in early August. Other locations are expected to follow soon after. The two-or-three-seat pods will feature “premium heated reclining chairs, two convenient side tables, storage compartments for personal belongings, coat hooks, and a surrounding privacy enclosure”, ac-

MJR movie theaters are introducing VIP Seats, which will feature a privacy separator and reclining seats. | MJR

cording to a press release. MJR also plans to debut Laser Ultra, a new large-screen format, and a Dolby Atmos sound system at their theaters. During the COVID-19 pandemic, movie theaters were forced to shut down for months. Streaming services exploded with offerings, with Disney+, HBO Max, and Paramount+ all finding success among a viewing audience largely stuck at home. When the state lifted restrictions on movie theaters in December 2020, concessions remained closed, taking a huge chunk of the profits and making some theater owners question whether it made

sense to even reopen. Since then, service has returned to normal — but the crowds haven’t followed. National box office revenue is down 73.7 percent from 2019, but up 10 percent from 2020, according to ticket sales tracking site ComScore. The box office generated about $11.4 billion in 2019, and analysts are estimating approximately $8 billion in revenue for 2022. Theater attendance was down 50 percent in 2021 compared to 2019, according to data from the Motion Picture Association. See THEATERS on Page 29 JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 3

REAL ESTATE INSIDER

Vacancies on Detroit commission prompt cancellations Some vacancies on the Historic District Commission are prompting delays in project approvals. The expiration of two former Kirk commission PINHO member terms in February is having ripple effects into June as two meetings have been canceled due to lack of a quorum. That’s causing some projects to wait a few more weeks to get the HDC sign off, which is required for work on historic buildings or homes in local historic districts. The city hopes the issue is resolved soon and notes that the delays have been minor. “It’s just a blip in the road,” said Shane Overbey, a contractor who’s working on a project at 445 W. Forest Ave. expected to go before the commission later this month. Dan Austin, director of communications for planning, housing and development for the city which staffs the HDC, said Detroit developer Roderick Hardamon is being nominated to fill one of the vacant posts and was to be interviewed by the Detroit City Council Internal Operations Committee on Wednesday with confirmation by the full council possible this week. Hardamon has projects with other investors, including a new 30-unit apartment building called Osi Art Apartments @ West End and is working to get a new 38-unit building on West McNichols near Livernois out of the ground. Hardamon declined comment on this nomination on Tuesday, but said the majority of the OSI project should be wrapped up this year, and that demolition should begin on the West McNichols/Livernois project this month. “The mayor will be interviewing two others for the final seat in the days ahead,” Austin said in an email. “In the two cases in which personal matters left HDC without a quorum, we were able to meet the same month in a special meeting in order to continue moving the people’s business forward.” The two former commissioners were

Detroit skyline as seen down Woodward Avenue.. | GETTY IMAGES

Dennis Kefallinos is attempting to sell a pair of Brush Park residential buildings he owns on John R and Adelaide streets. | COSTAR GROUP INC.

Alease Johnson and Katie Johnson. “I made a decision not to re-sign,” said Alease Johnson, who is operations manager for Friends of the Children–Detroit. Austin said the city has “set out to find not only candidates who would meet the criteria for the seats, but would be most qualified to serve the people of Detroit and their interests.”

Kefallinos lists Brush Park buildings Controversial landlord Dennis Kefallinos has put a pair of apartment buildings he owns in Detroit’s rapidly-developing Brush Park neighborhood for sale. The asking price for the buildings at 2627 John R and one on Adelaide

Street is not listed. Combined, they have 72 apartments, according to marketing materials from Grosse Pointe-based Greater Development LLC. The materials say 33 of the 56 units in the John R building are vacant, with the 23 rented units having tenants on month-to-month leases. And 12 of the 16 units in the Adelaide building are vacant, with the four rented units having tenants on month-to-month leases. The John R building was recently damaged in a fire. Martin Krall of Greater Development said tours for qualified buyers are being held June 16, 21 and 23 and offers are being accepted through June 30. You can RSVP at info@greaterdevelopment.net. Several new buildings, including the City Modern development, have risen in the last few years in Brush Park, and others are under construction. Kefallinos has been in Detroit real estate for decades. He’s been the target of widespread criticism for sitting

on properties and delaying renovations or improvements to a slew of buildings he owns across town. Among his more well-known assets are the Russell Industrial Center off I-75, which the city emptied in February 2017 over safety concerns (some tenants were later allowed to return as fixes were made); a slew of residential buildings that have had numerous repair and maintenance issues over the years; the former Roosevelt Hotel in Corktown; the Michigan Building and former Michigan Theatre at 220 Bagley St.; and others. Over the years, Kefallinos has faced scores of lawsuits over issues ranging from housing discrimination complaints to a class-action lawsuit over leasing his residential buildings to tenants without certificates of occupancy to another lawsuit over how the dancers are paid at his Bouzouki strip club in the city’s Greektown neighborhood. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

REAL ESTATE

Demolition contract for part of Packard Plant to be awarded BY KIRK PINHO

The Detroit City Council is expected to consider awarding a demolition contract for a portion of the Packard Plant later this month. LaJuan Counts, director of the Detroit Demolition Department, said in a statement that there was only one bidder to a May request for proposals to tear down a Fernando Palazuelo-owned building at 6199 Concord St. that’s part of the dilapidated plant, and that the city hopes to award the contract to the unnamed firm this week and present the item for consideration by Detroit City Council in a week. Counts said the city is “moving as quickly as possible” to tear down that portion of the plant because it “poses an imminent danger” as it shares a wall with The Display Group Ltd., which 4 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

The city is looking to demolish large parts of the former Packard Plant. | KIRK PINHO/CRAIN’S DETROIT BUSINESS

owns the 285,000-square-foot former No. 22 building that used to be part of the plant and operates its Display Group Creative Collective out of it. “After that, the contractor will have several weeks of prep work and we are aiming for a late summer start of active demolition,” Counts said. “The cityowned portion (at 1539 E. Grand Blvd.) has a longer bid window and we expect demolition to begin this fall.” Rick Portwood, founder of Display Group, said while the 6199 Concord building hasn’t deteriorated substantially in the last several months, there have been “issues where things fall off that building for several years.” The city issued a request for proposals in May to tear down the Concord building, part of its ongoing effort to raze the plant. Detroit expects to use American Rescue Plan Act dollars for

the 120 day demolition. Counts declined to identify the contractor or cost of the bid. In April, Palazuelo missed a court-ordered deadline to submit demolition permit applications. On March 31, Circuit Court Judge Brian Sullivan ruled Palazuelo must apply for demolition permits within 21 days, begin tearing it down within 42 days and complete demolition within 90. Noncompliance with the order allows the city to demolish the property and get a judgment for the costs to raze and clean it up, as well as a judgment lien for that cost, Charles Raimi, the city’s deputy corporation counsel, has previously said. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

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COMMENTARY

When it comes to population, it’s grow or die BY KEN HORN

DANIEL SAAD FOR CRAIN’S DETROIT BUSINESS

COMMENTARY

Inventory glut is supply chain bullwhip snapping back Dustin

WALSH

But here’s the thing. People weren’t going to the bathroom any more than usual, so now the rolls are stacking up. Look about and you can find a pretty good deal on toilet paper at almost any retailer. Something similar has happened for truckloads and warehouses of other products. With restaurants and movie theaters and theme parks shut down during the pandemic, consumers shifted from buying services to goods. My family invested in a home office remodel. Others finally ripped down that old wallpaper or built new decks (remember the wood shortage?). But all that’s changed again. All those places are back open. For instance, entertainment and recreation spending was up more than 57 percent as of May 22 over January 2020 and the concert season hasn’t even reached full swing. Retail spending was up 34.8 percent over the same period. In short, people are out enjoying themselves in public instead of adding to their sound system or their kitchen devices lineup. See BULLWHIP on Page 7

MORE ON WJR ` Crain’s Executive Editor Kelley Root and Managing Editor Michael Lee talk about the week’s stories every Monday morning at 6:15 a.m. Mondays on WJR 760 AM’s Paul W. Smith Show.

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited for length or clarity. Send letters to Crain’s Detroit Business, 1155 Gratiot Ave, Detroit, MI 48207, or email crainsdetroit@crain.com. Please include your complete name, city from which you are writing and a phone number for fact-checking purposes. 6 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

GETTY IMAGES

alk into a Target store and you’re likely to find more toaster ovens and skateboards and wireless speakers than ever before. The nation’s seventh largest retailer is literally overflowing with inventory. Products on its shelves and in warehouses climbed 43 percent during the first quarter of 2022 over the same period last year, the company said in its earnings call earlier this month. As a result, Target vowed to lower prices and accept lower margins to clear its stores. The story is playing out across most major retailers in the U.S. as the arithmetic for supply and demand continues to give vertigo to manufacturers, wholesalers, distributors, retailers and customers. What we’re seeing across all industries is the bullwhip effect that began at the start of the pandemic. When COVID-19 reached American shores in SUPPLY CHAINS March 2020, manurapidly cut ARE OFTEN LONG facturers production, projecting a rapid economic AND LAYERED decline. That hapACROSS pened, but with government stimulus HUNDREDS OF quickly in tow, conCOMPANIES AND sumer demand recovand, in fact, grew WHOLESALERS. ered rapidly throughout the pandemic. As of May 22, consumer spending was up 19.1 percent in Michigan over January 2020 when the economy was red hot, according to data from Harvard’s Opportunity Insights Economic Tracker. The spending created a mismatch of demand and supply with manufacturers offline. This spurred the Great Toilet Paper Run Up for 2020. This, of course, spurred TP manufacturers to produce more and for stores to order more.

here’s no way around it — Michigan needs a million more people. During the “lost decade” (2005-2015), Michigan lost population and nearly a million jobs. We lost skilled, educated, and talented Michigan Ken Horn is a Republican state workers to opportunities in other states. senator from As a result, our schools Frankenmuth. today have fewer kids sitting in classrooms, and schools are suffering. Families took their employer-paid health care plans with them as well, leaving Michigan with a growing Medicaid bill and a shortage of doctors and nurses. These were only the beginning of our problems. The years following the “lost decade”, our population levels flattened out, but other states continued to grow. This left Michigan businesses, schools, police forces and fire departments scrambling to compete for the remaining qualified workers, often with taxpayer-paid training dollars. Michigan also lost another congressional district, meaning lost influence in the nation’s capitol. When Michigan loses population — we lose. When our population stays flat — we lose again. There is only one way to win, and that’s to grow. That’s why I haven’t been shy about talking up my One Million People Project, or Project 1MP — one million people in less than 10 years. Truthfully, we will never graduate enough high school, nor college students, to fill the workforce needs we have today, even with a hundred percent in-state retention rate. And, we still have a wave of baby-boomer retirements to face. The Strategic Outreach and Attraction Reserve or SOAR fund was a necessary step to growing. Michigan was, without hyperbole, a month or two away from another lost decade. We were on the verge of losing our historical grip on the current automotive industry, and likely every autoworker by the year 2035. We needed to come together as a legislature, with the administration, and with the private sector to save Michigan’s future. We did. SOAR was a remarkable moment for us, and not surprisingly, caught the attention of the world. Today, there is a line of amazing potential developments, industries of all sorts, looking to bring their jobs here. One million people in less than 10 years.

How do we get there? Project 1MP means growing by almost 10 percent. For Michigan businesses, large and small alike, how can we help you grow by 10 percent? Let’s continue to fund programs for obsolete buildings and technologies. Let’s talk about the research and development tax credits, like surrounding states have, to inspire Michigan innovation. Let’s restore the MiEOP program (Good Jobs for Michigan); a huge success. Let’s give another half-billion dollar shot in the arm to SOAR. For our cities, villages, and towns all across the state, how will you grow by 10 percent? What’s standing in your way? What’s needed for revitalization and placemaking? Project 1MP will certainly ease our police and firefighter search issues. Let’s partner up with ServeMICity, a Michigan Municipal League program. A key to attracting and retaining top talent to Michigan will be our school systems; from top to bottom. Record investments into our K-12 education system will have families wanting to locate in communities near their Michigan workplaces. Under-investments in higher education comes to an end this year. Last week, the Senate Appropriations committee passed Senate Bill 85, which I sponsored, to provide much needed updates at many of our state’s universities and community colleges. In combination with new, “last dollar” student scholarships, Reconnect, Going Pro Talent Fund and more, Michiganders can train and make a place for themselves right here in Michigan. Our commitment to annual college and university funding should be extraordinary over the next two years. Our facilities will be renovated and updated to attract the best talent from around the country and the globe, positioning them to thrive in today’s highly advanced and competitive world. When we combine forces and approach this from every angle, Michigan students will get the best education on the planet. Businesses small and large will have an incredible pool of new talent. Our communities will be the safest and most walkable. Our health care will be unrivaled, including rural Michigan. Our parks will be the greenest and our water the purest. The world is taking notice. One thing I learned in my lifetime is that there are many powerful emotions in this world; love and hate being amongst them. But if you ever want to get anything done — there’s nothing that beats envy. Project 1MP will grow Michigan by one million people in less than 10 years, if we work together to make Michigan the pure envy of the world.

Sound off: Crain’s considers longer opinion pieces from guest writers on issues of interest to business readers. Email ideas to Managing Editor Michael Lee at malee@crain.com.

BULLWHIP

From Page 6

“What’s happened is just as predictable as the setting sun,” said John Taylor, associate professor of supply chain management at Wayne State University. “It’s the backside of the bullwhip. Demand keeps changing dramatically. We don’t normally experience this many large changes and it’s very hard to keep track of the demand signals.” The easiest way to imagine the bullwhip is, well, a bullwhip. When it’s cracked, the whip undulates up and down like a wave. When consumers demand more than predicted, retailers buy more, manufacturers make more and suppliers supply more. However, if that demand suddenly falls — say after you’ve accumulated way too much toilet paper — retailers stop ordering, manufacturers stop manufacturing and suppliers stop supplying. But it takes a while. Supply chains are often long and layered across hundreds of companies and wholesalers, without the most sophisticated communication among them. So without being almost spot on with the supply for the demand, you see gluts and subsequently shortages. A la, the bullwhip. “Everyone in the supply chain has a self interest,” Taylor said. “Even a company the size of Walmart isn’t always buying direct from the manufacturer. Take their fish and tackle department. That entire department is handled by a wholesaler. The wholesalers are placing big orders so their big customer doesn’t run out of stock. The retailer then sees these big orders and thinks it’s the demand. All of this is then exacerbated by delays in manufacturing. The more levels there are the harder it is to spot the demand and we have a lot of levels in our global network.” And despite the waning pandemic and a return to whatever we’re calling the baseline today, it’s not getting easier for retailers. Like a carpet python constricting its prey, inflation is putting its squeeze on the economy. Companies are preparing themselves for a recession — the U.S. economy will tip into a recession next year, according to nearly 70 percent of economists polled by the University of Chicago and the Financial Times, in a report released last week. The U.S. Federal Reserve is trying to slow down inflation by ramping up interest rates, raising them by 0.75 percentage points since March. This, in turn, is making it harder for companies to borrow and their money markets to slow. And consumers may be running out of cash. The personal savings rate — the percentage of disposable income minus personal consumption and taxes — reached 4.4 percent in April, the lowest its been since the start of the Great Recession in 2008. One could expect that figure to have sunk lower in May with exorbitant fuel prices near or above $5 a gallon. By contrast, the personal savings rate was 26.6 percent in March 2021, largely due to federal stimulus. But it’s not a sure bet that spending will slow down that dramatically. It’s an election year in Michigan and there’s a surplus of federal funds still to be distributed by the state. Infrastructure spending

could push consumers back on the buying train. So it’s almost anyone’s guess whether the supply-demand conundrum will reach stasis. And even when it does, it will take several quarters for manufacturers and retailers to catch up and for prices and stocks to normalize, Taylor said. “Even if they figure out the demand changes, it’s going to take a few months for manufacturing and shipping to happen,” Taylor said. “We don’t know where inflation is going to go or when demand smooths out. And if demand changes again dramatically, the bullwhip is back into effect.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

Walmart is now paying more for storage after a glut of inventory is putting pressure on the big box store. | BLOOMBERG

A PARTNER FOR HEALTH

Wherever you go around Michigan, you’ll find a Wayne State doctor, nurse, pharmacist or care provider nearby. Every day, these Warriors are changing — and saving — lives in hospitals and clinics, and their research continues to improve the quality of life around the world. And, wherever you go around our campus, you’ll find students putting what they learn from experienced faculty into action throughout the city, teaming with experts across the spectrum of care to meet community needs. They go on to serve as health professionals who bring the compassion and expertise they developed in Detroit to people everywhere. We think this approach creates a very healthy partnership with our global community, and develops health care leaders who are Warrior Strong.

wayne.edu

JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 7

HEALTH FUNDING Senate OKs more than half a billion dollars in aid focused on mental health.

HEALTH CARE

PAGE 11

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Nursing supervisor Carissa Gray, left, and patient care secretary Laurie Walker check patient information at Memorial Healthcare Hospital in Owosso in November. | NIC ANTAYA, FOR CRAIN’S DETROIT

Hospitals are suffering from worker shortages. Can technology fill the gaps? `BY DUSTIN WALSH The great resignation in health care

has been years in the making — COVID-19 just sped up the problem. Many health care workers left the industry during the pandemic to escape harsh conditions and growing responsibilities. Each worker that left meant another worker that had to pick up the slack. Burnout became synonymous with the job title “hospital worker,” whether that worker was a nurse, paramedic or custodian. A job vacancy rate of roughly 17 percent persists at Michigan hospitals, leading to about 1,300 fewer patient beds available for the sick across the state compared to last year. “The reality is we knew even before the pandemic that we would have many people leaving the field,” said Brian Peters, CEO of the Michigan Health & Hospital Association. “Demographics aren’t on our side, and we’re simply not training enough nurses, doctors, pharmacists, whatever to replace all those retiring in the coming years.”

8 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

Roughly one in five health care workers left or retired from the field between the start of the pandemic in 2020 and November 2021, according to a survey from research company Morning Consult. The U.S. faces a projected shortage of between 37,800 and 124,000 physicians within 12 years, according to a report released in June 2021 by the Association of American Medical Colleges. A similar story plays out for nurses, medical assistants and so on. In an attempt to bolster the workforce without a pipeline for backfilling the jobs, local hospitals are turning inward and finding innovative — and sometimes obvious — ways to implement technology and create a pool of available workers seeking alternatives to full-time shifts.

Adventures in telesitting Henry Ford Health is finding job models that allow it to retain some of those leaving the grind of the

Brian Peters

long work weeks on the hospital floor but may be willing to entertain a part-time job ... from the comfort of their home. The Detroit-based heath system is going to launch a job called “virtual sitting” in the fall at two of its hospitals. Often in the hospital, patients suffering from dementia or

another mental episode will require a nurse or medical assistant to watch the patient for their own safety. That chews up an expensive resource that could be assisting other patients as well as reducing the number of available caregivers, said Eric Wallis, chief nursing officer for HFH. “If I am a nurse close to retirement, maybe working a 12-hour shift isn’t attractive anymore,” Wallis said. “But if we can use cameras, we can employ staff from anywhere who can visualize and watch those patients and speak to them via a speaker and interact with a team that’s on site if they do something that isn’t safe. That will help reduce the bedside stress on our nurses.” Wallis said the “telesitting” program is the first of many to come for HFH as it embraces the use of cameras and technology to nurse virtually. See WORKERS on Page 8

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FOCUS | HEALTH CARE

WORKERS

From Page 8

John Jones, managing director of advisory firm Willis Towers Watson’s employee experience unit for North America, said managing patient loads with appropriate work schedules is the industry’s greatest focus — and technology is the ultimate leveler. “Being able to use technology to make it easier on a nurse to cover a larger patient load and, in some cases, improve care even with staffing shortages is paramount,” Jones said. “Necessity is the mother of invention, so health care is looking at things very differently right now.” The HFH system is looking to move the time-consuming task of completing admittance and discharge paperwork, which takes beWallis tween 20 and 45 minutes, Wallis said, to a virtual setting through a camera and speaker system. “We’re not deploying this to our high end resources,” Wallis said. “The hardest part of any patient is when they are admitted and when they are discharged. Those transitions in care are burdensome and time consuming for staff.”

Housekeeper Ann VanDeusen prepares herself before sanitizing a COVID-19 room at Memorial Healthcare Hospital in Owosso, in November. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Peters said HFH moving some workflow to the virtual space follows in accordance with the industry’s long-standing initiative to move workers to operate at the highest of their credential. “We have had, unfortunately, highly trained and highly skilled nurses and even doctors doing things on a daily basis that could be done by

a less trained person,” Peters said. “They should spend more time doing things they are trained for. Maximizing that will go a long way to addressing this workforce challenge.”

A keystone pipeline Replacing outgoing health care workers remains the industry’s great

long-term threat. Earlier this month, higher education institutions and the industry in the state released a collaborative plan to produce those skilled workers. Michigan’s public universities will work with the state’s community colleges to make four-year nursing degree education available away from the ivory tower of their universities.

Prospective nurses would be able to earn a bachelor’s in nursing at 28 community college campuses with cooperation from local employers and workforce development agencies. However, the funding remains the hurdle. The organizers of the plan — the Michigan Community College Association, Michigan Association of State Universities, Michigan Independent Colleges and Universities and the Michigan Health and Hospital Association — are seeking $56 million from the state to supply grants to students that completed an associate in nursing degree. Under that plan, each community college would be eligible for $2 million in grant funding for students in hopes of boosting bachelor’s degrees among nurses. “The plan ensures that Michigan nursing students have every option possible to get high-quality education and training on nearly every college, university or community college campus in this state,” Robert LeFevre, president of the Michigan Independent Colleges and Universities, said in a press release. Trinity Health, the national health system of 88 hospitals based in Livonia, isn’t waiting for the structural fixes needed to boost health care workers. Trinity is expanding an apprenticeship program launched in 2016 in West Michigan to more hospitals. See WORKERS on Page 10

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FOCUS | HEALTH CARE

WORKERS

From Page 8

“At that time, we had a demand issue with medical assistants that led to us have to reduce some of our practice hours,” said Shana Lewis, vice president of talent acquisition and workforce development programs for Trinity. “When we saw our turnover data and forecasting, we thought we should try an apprenticeship program like manufacturing and construction do.” The program, developed with Grand Rapids Community College and Michigan Works!, is 12 months long and has boosted Trinity Michigan’s medical assistant retention rate to 76 percent one year after graduating from the program. The health system has trained 129 medical assistants since launch six years ago. Most certification programs, like a medical assistant or nursing assistant, are external six-week programs that charge students fees. In Trinity’s program, students are paid to participate in the classroom three days a week and in the hospitals two days a week. Trinity has since launched four more apprenticeship programs in clinical documentation, coding, surgical technology and image processing. Trinity is also taking its medical assistant apprenticeship program it launched in Michigan to its hospitals nationally starting in July.

Microbiology technician Chris Walker works in the microbiology lab at Memorial Healthcare Hospital in Owosso last year. | NIC ANTAYA FOR CRAIN’S DETROIT

“We’re exploring other ways of introducing the apprenticeship program in any space we have workforce gaps which is pretty much every sector,” Lewis said. “This is 100 percent pipeline building and designed to start individuals down a career path in health care.”

Stopping the outmigration The loss of nurses has been particularly difficult for many hospitals. In an effort to fill open shifts, the BHSH System came up with the Beaumont Flex Nursing team, a pro-

gram that offers competitive nursing pay rates, various shift options and staffing contract choices. The nursing team can create its own schedule using a scheduling app, the system said. Adding to that is more effort in recruiting for nurses and medical technologists from Canada and overseas. Beaumont works with a vendor to bring these employees in full time as contract workers and they are then hired permanently once they complete their required hours. “There’s no one thing that you do

to turn the faucet on when it comes to recruitment,” Gianna Ferrarotti, vice president of talent management and organizational effectiveness for Beaumont Health, said in an emailed statement. “Everyone is competing for talent right now, and we believe there are many compelling reasons to choose to be a part of BHSH Beaumont Health.” For its part, Henry Ford Health is also offering more choices to its workforce. Its Best Choice program, which it launched eight years ago, is a pool of health care workers at the company that operates like an agency. The program identifies its daily needs for workers and taps the existing pool of workers who are not attached to a regular full-time gig at its hospitals and deploys them to fill the gaps. “Instead of relying on external agencies to supply us labor at a high cost, we wanted to create a team internally with a slightly higher pay rate that could be flexible enough for us to address our daily needs,” Wallis said. These workers notify the health system of their weekly availability and are tapped when a hospital or clinic has a need. They are considered contingent workers and are not provided benefits. Currently, the program includes roughly 470 nurses, 92 medical assistants and 25 technical staff that can be deployed to HFH’s five hospitals and 126 ambulatory sites.

BY D Ferrarotti

Welch

The group averaged 430,000 hours worked in 2021, or about 14 hours per week per employee, Wallis said. Some of those in the Best Choice program are employed at other health systems and use the program for extra pay, he said. “We’ve sized the pool to cover about 80 percent of the staffing we need,” Wallis said. “We still have overtime for our regular staff, but this helps alleviate most of our issues during normal operations.” Jones said beyond innovative approaches to workflow and scheduling, hospitals are also grappling with creating a better work environment for staff, which is a large part of the outflow problem. “Workers have seen a difficult two-to-three years now,” Jones said. “Creating a healthy work environment is critical. Organizations are getting creative but unless the technology and shift scheduling can improve employee satisfaction, it’s not solving the problem.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

COVERAGE THAT FITS YOUR BUSINESS AND YOUR BUDGET

10 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022 BCB144885_MSG_CrainsDetBus_HalfPageSpread_6-20-22_Ins_F1.indd 1

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FOCUS | HEALTH CARE

State Senate passes $590M in mental health care, other spending The spending measure would fund more than three dozen initiatives or programs BY DAVID EGGERT

LANSING — The Michigan Senate on Wednesday overwhelmingly voted to spend nearly $550 million in federal pandemic aid to primarily boost mental health services, including $50 million to prepare for a potential overhaul of the state’s Medicaid behavioral health system. Senate Majority Leader Mike Shirkey’s legislation to let private insurers manage Medicaid service for recipients with severe mental health, substance abuse disorders or cognitive disabilities remains pending on the floor. But the supplemental budget bill, which was approved 36-1 and sent to the House, would tie more than $100 million in “integration readiness” and other funding to passage of the policy bills. “Michigan’s mental health system is failing patients, their families, providers and taxpayers,” Shirkey said. “This bill is a piece, an important piece, of what I hope is a comprehensive plan to address this broken system.” Leaders among Michigan’s existing county-level community mental health agencies have been opposed to privatization of their management services. The spending measure, which to-

Sen Mike Shirkey, Senate Majority Leader speaks at the Mackinac Policy Conference. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

tals $590 million including state funds, would fund more than three dozen initiatives or programs related to health care — mainly in the mental health sector. Big-ticket items include: ` $100 million for a competitive grant program to increase the number of long-term pediatric psychiatric inpatient slots by at least 120. Applicants

would have to provide a 20 percent match. Grants could not exceed $25 million. ` $35 million for Ascension Health, which has hospitals across Michigan. A Shirkey spokesperson said it would help Ascension “greatly expand their behavioral health capacity in an area of the state where additional bed space and treatment options are des-

perately needed.” ` $30 million to expand apprenticeships in medical fields. ` $25 million for entities interested in establishing psychiatric residential treatment facilities. ` $25 million for facilities wanting to create crisis stabilization units. ` $25 million to fund an expansion of a state loan repayment program for mental health professionals who work in underserved areas. ` $25 million to upgrade all five staterun psychiatric hospitals. ` $25 million, a 50 percent match, to build a central intake assessment facility for the Macomb County Jail. ` $20 million to add telemedicine services at local health offices, homeless shelters, community centers and similar entities. ` $6 million for Michigan Medicine to create a dedicated emergency room for children and adolescents. ` $5 million to expand the Hawthorn Center in Northville, a state psychiatric hospital for children. Sen. Stephanie Chang, a Detroit Democrat, unsuccessfully tried to remove provisions linking some funding to approval of the legislation that would integrate Medicaid recipients with severe mental health, substance abuse disorders or cognitive disabilities into the regular physical health

“MICHIGAN’S MENTAL HEALTH SYSTEM IS FAILING PATIENTS, THEIR FAMILIES, PROVIDERS AND TAXPAYERS. THIS BILL IS A PIECE, AN IMPORTANT PIECE, OF WHAT I HOPE IS A COMPREHENSIVE PLAN TO ADDRESS THIS BROKEN SYSTEM.” — Mike Shirkey, Senate majority leader

system, much of which is managed by for-profit plans. “Social workers, community mental health institutions and others with years of expertise in mental health have substantial concerns with these bills, which are centered on financial integration of behavioral and physical health in a top-down approach that should instead be centered on the people actually receiving behavioral health services,” she said. Chang still voted for the spending bill. Contact: david.eggert@crain.com; (313) 446-1654; @DavidEggert00

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JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 11 6/8/22 12:16 PM

CRAIN'S LIST | MICHIGAN HOSPITAL COMPANIES Ranked by 2021 net patient revenue COMPANY ADDRESS PHONE; WEBSITE

TOP EXECUTIVE(S)

NET PATIENT REVENUE ($000,000) 2021/2020

TOTAL REVENUE 2021/2020

UNCOMPENSATED LICENSED-BED CARE CAPACITY/ ($000,000) OCCUPANCY 2021

NUMBER OF EMPLOYED PHYSICIANS JAN. 2022

NUMBER OF HOSPITAL/ AMBULATORY FACILITIES MAJOR FACILITIES

BEAUMONT HEALTH 1

Nancy Susick, interim president and co-COO; Dave Claeys, interim co-COO, president, Beaumont Hospital, Dearborn & Beaumont Hospital, Farmington Hills; Benjamin Schwartz, president 2

$4,344.1

$4,695.7 $4,580.8

3,375 68.1%

1,110

8 151

Beaumont hospitals in Dearborn, Farmington Hills, Grosse Pointe, Royal Oak, Taylor, Trenton, Troy and Wayne

HENRY FORD HEALTH SYSTEM

Wright Lassiter president and CEO

$4,241.7 3

$6,806 3 $6,502.1 4

NA NA%

1,900 3

NA NA

Henry Ford Hospital; Henry Ford Macomb Hospital; Henry Ford Wyandotte Hospital; Henry Ford Kingswood Hospital; Henry Ford West Bloomfield Hospital; Henry Ford Allegiance Health; Health Alliance Plan.

ASCENSION MICHIGAN

Joe Cacchione, executive VP, Clinical & Network Services, Ascension interim Ministry Market Executive, Ascension Michigan

$4,111.8

$4,482.3 $4,180.7

3,673 53.3%

1,067

16 46

Ascension St. John Hospital, Ascension River District Hospital, Ascension Macomb-Oakland Hospital - Madison Heights Campus, Ascension Macomb-Oakland Hospital - Warren Campus, Ascension Providence Hospital - Novi Campus, Ascension Providence Hospital - Southfield Campus, Ascension Providence Rochester Hospital, Ascension St. Mary's Hospital, Ascension St. Joseph Hospital, Ascension Standish Hospital, Ascension Genesys Hospital, Ascension Borgess Hospital and others

MICHIGAN MEDICINE5

Marschall Runge EVP for medical affairs

$3,952.6

$4,682.6 $4,347.7

1,107 77.0%

1 40

University Hospital, Mott Children's Hospital, Women's Hospital, A. Alfred Taubman Health Care Center, UM Comprehensive Cancer Center, UM Cardiovascular Center, UM Depression Center, Kellogg Eye Center

TRINITY HEALTH MICHIGAN

Robert Casalou president and CEO

$3,544.8

NA $3,500 e

2,233 NA%

8 NA

St. Joseph Mercy Ann Arbor, St. Joseph Mercy Chelsea, St. Joseph Mercy Livingston, St. Joseph Mercy Oakland, St. Mary Mercy Livonia, Mercy Health Saint Mary's, Mercy Health Muskegon, Mercy Health Lakeshore Campus

SPECTRUM HEALTH SYSTEM 1

Tina Freese Decker president and CEO

$3,464.8

$9,179.1 $8,299.8

2,538 87.0%

1,222

14 230

Spectrum Health West Michigan: Butterworth, Blodgett, Reed City, United, Kelsey, Gerber Memorial, Zeeland Community, Helen DeVos Children's, Big Rapids, Ludington and Pennock. Spectrum Health Lakeland: St. Joseph, Niles and Watervliet

MCLAREN HEALTH CARE

Philip Incarnati president and CEO

$3,121.0

$6,022.3 $5,078.9

3,459 60.9%

314

15 350

McLaren Bay Region, McLaren Bay Special Care, McLaren Caro, McLaren Central Michigan, McLaren Greater Lansing, McLaren Orthopedic Hospital, McLaren Lapeer Region, McLaren Clarkston, McLaren Flint, McLaren Health Plan, McLaren Macomb, McLaren Oakland, McLaren Northern Michigan, McLaren Northern Michigan Cheboygan, McLaren Port Huron, McLaren Thumb Region, Karmanos Cancer Institute, , and others

DETROIT MEDICAL CENTER

Brittany Lavis CEO 6

$1,609.0 e

NA NA

NA NA%

NA NA

Children's Hospital of Michigan, Detroit; Children's Hospital of Michigan, Troy; Detroit Receiving Hospital; Harper University Hospital; Hutzel Women's Hospital; Cardiovascular Institute; Rehabilitation Institute of Michigan; Sinai-Grace Hospital; Huron Valley Sinai Hospital.

SPARROW HEALTH SYSTEM

James Dover president and CEO

$1,195.4

$1,505.8 $1,402.9

845 64.0%

358

6 56

Sparrow Hospital, Sparrow Carson Hospital, Sparrow Ionia Hospital, Sparrow Clinton Hospital, Sparrow Specialty Hospital, Sparrow Eaton Hospital

MYMICHIGAN HEALTH8

Greg Rogers president and CEO

$1,037.4

$1,100.4 $1,000

722 40.4%

342

6 3

MidMichigan Medical Centers in Alma, Alpena, Clare, Gladwin, Midland, Mt. Pleasant, West Branch and Sault.

COVENANT HEALTHCARE

Ed Bruff president and CEO

$630.9 e

NA NA

NA NA%

NA NA

Covenant HealthCare

UNIVERSITY OF MICHIGAN HEALTH-WEST 9

Peter Hahn president and CEO

$492.8

$492.8 $488.8

208 53.9%

151

1 26

17 neighborhood outpatient offices as well as an urgent care and community clinic

HURLEY MEDICAL CENTER

Melany Gavulic president and CEO

$410.7

$1,404.8 $1,339

443 80.5%

1 11

Hurley Medical Center

PROMEDICA MICHIGAN

Randy Oostra, president and CEO, ProMedica Health System; Darrin Arquette, president Regional Acute Care, Michigan; Dawn Buskey, president Acute Care

$352.4

$1,268.9 NA

381 NA%

NA NA

ProMedica Coldwater Regional Hospital, ProMedica Monroe Regional Hospital, ProMedica Charles and Virginia Hickman Hospital

MEMORIAL HEALTHCARE

Brian Long president and CEO

$213.3

$235.9 $219.1

165 46.0%

122

1 14

Memorial Hospital

PINE REST CHRISTIAN MENTAL HEALTH SERVICES

Bill Sanders, chief medical officer; Mark Eastburg, president and CEO; Bob Nykamp, VP and COO

$179.8

$157.5 NA

NA 85.0%

NA NA

Grand Rapids, Caledonia, Grandville, Byron Center, Hastings, Kalamazoo, Portage, Traverse City, St. Joseph, Holland, Zeeland, Spring Lake, Lakeland.

HEALTHSOURCE SAGINAW

Michelle Trevillian president and CEO

$50.4 e

$51.2 e $49.6

347 NA%

1 1

Saginaw

26901 Beaumont Blvd., Southfield 48033 248-898-5000; beaumont.org

1 Ford Place, Detroit 48202 800-436-7936; henryford.com

28000 Dequindre Road, Warren 48092 866-501-3627; ascension.org/michigan

1500 E. Medical Center Drive, Ann Arbor 48109 734-936-4000; med.umich.edu

1600 S Canton Center Road, Canton 48188 734-343-1000; trinity-health.org, .stjoeshealth.org

100 Michigan St. NE, Grand Rapids 49503 616-391-1774; www.spectrumhealth.org

One McLaren Parkway, Grand Blanc 48439 810-342-1100; mclaren.org

3990 John R, Detroit 48201 313-745-5146; dmc.org

1215 E. Michigan Ave., Lansing 48912 517-364-1000; sparrow.org

4611 Campus Ridge Drive, Midland 48640 989-839-3000; mymichigan.org

1447 N. Harrison, Saginaw 48602 989-583-0000; covenanthealthcare.com

5900 Byron Center Ave. SW, Wyoming 49519 616-252-7200; uofmhealthwest.org

1 Hurley Plaza, Flint 48503 810-262-9000; hurleymc.com

718 N. Monroe St., Monroe 48162 ; promedica.org

826 W. King St., Owosso 48867 989-720-2273; memorialhealthcare.org

300 68th St. SE, P.O. Box 165, Grand Rapids 49501 616-455-5000; www.pinerest.org 3340 Hospital Road, Saginaw 48603 989-790-7700; healthsourcesaginaw.org

$3,959.1

$3,665.9 4

$3,702.1

$3,500.3

$3,100.5

$3,174.3

$2,643.1

$1,560.0 7

$1,039.0

$928.0

$611.7

$488.8

$394.9

$290.3

$186.4

$48.9

Researched by Sonya D. Hill: shill@crain.com | This listing is an approximate compilation of the leading hospital companies based in Michigan. Net patient revenue listed is operating revenue, excluding bad debt. Total revenue is net patient revenue, investment income, non-operating or other revenue. Uncompensated care is charity care plus bad debt at costs. These are medical services for which no payment is received or expected. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the companies directly or from state and federal filings. Companies with headquarters elsewhere are listed with the address and top executive of their main Michigan office. Detroit Medical Center did not respond to requests for information before the publication date. NA = not available. NOTES: e. Crain's estimate. 1. Beaumont Health and Spectrum Health launched as one integrated health system on Feb. 1. The temporary name will now be BHSH Health. 2. Assumes role as president, effective July 5. 3. Annual financial report ending in Dec. 31, 2021. 4. Annual financial report ending in Dec. 31, 2020. 5. Formerly University of Michigan Health System. 6. Named permanent CEO on Jan. 31. Became interim group CEO after Audrey Gregory's departure on Oct. 22. 7. From Modern Healthcare. 8. Formerly MidMichigan Health. Effective Dec. 1, 2021, the name change was part of a system-wide brand change updating the health system and facility names, and logo. 9. Metro Health-University of Michigan Health announced it is rebranding to University of Michigan Health-West in June 2021.

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data

12 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

FINANCE

Report: Detroit is top ‘emerging ecosystem’ for startups San Francisco-based Startup Genome study ranks Detroit highly on multiple fronts BY NICK MANES

A new report names Detroit as the world’s No. 1 “emerging ecosystem” for technology startups, beating out global powerhouses including Hong Kong and Brussels. The 2022 Global Startup Ecosystem Report, released last week by San Francisco-based Startup Genome, a policy advisory and research organization for the startup economy, ranked Detroit as the top locale branded as an “emerging ecosystem.” The report defines those cities as “startup communities at earlier stages of growth, and our ranking methodology is adapted to reflect this, to showcase the strengths in these ecosystems that have high potential to be global top performers in the coming years.” Detroit, the report says, ranks high on multiple fronts, with available capital standing as the sole area for improvement. To rank the emerging startup ecosystems, the Startup Genome report looked at four different categories: ` Performance, which the report’s methodology says “captures the actual leading, current, and lagging indicators of ecosystem performance.” Within performance, the report looked at the total value of the eco-

The 2022 Global Startup Ecosystem Report, released last week by San Francisco-based Startup Genome, ranked Detroit as the top locale branded as an “emerging ecosystem.” | LARRY PEPLIN/CRAIN’S DETROIT BUSINESS

system, exits and general success of startup companies in the region. ` Funding looks primarily at access to available capital with a focus on early-stage capital. The report also puts minimal emphasis on the “qual-

ity and activity” of the ecosystem’s investor community. ` Connectedness, which aims to measure “how connected the ecosystem is to the global fabric of knowledge within the ecosystem.”

` Talent within the ecosystem. Detroit received perfect 10 scores in three of the buckets, while receiving an 8 in the funding category. Detroit’s standing in the report received kudos this week from various

policy leaders on social media and those working in quasi-governmental roles. “This latest ranking from Startup Genome highlights the tremendous growth for Detroit as a destination for startups and VC investment,” Fred Molnar, senior vice president of entrepreneurship and innovation at the Michigan Economic Development Corp., said in a statement. “As Michigan’s economy continues to thrive, we will continue to work on providing the most dynamic environment for startups across Michigan to find growth and success.” Other top performing locales for emerging startups around the globe include Hong Kong, Dublin, Minneapolis and Houston. The world’s overall top performing ecosystems, according to the Startup Genome report, are Silicon Valley, New York City and London tied at number two, Boston and Beijing. The naming of Detroit as the top emerging ecosystem comes amid a broader market chill that startup founders and venture capital investors say is starting to hit their sector of the economy. Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

PEOPLE

MARKETING

Henry Ford College president won’t take Virginia job after all

NFL signs Little Caesars as new pizza sponsor

Kavalhuna negotiating to stay at college BY AMELIA BENAVIDES-COLÓN

Henry Ford College President Russell Kavalhuna, who was slated to leave his position at the end of the month, is renegotiating his contract with HFC intending to stay on in his leadership role, Virginia Community Colleges announced last week. Kavalhuna had been hired to become the chancellor of Virginia’s Community College System March 17. The development came after VCCS’s hirKavalhuna ing process was criticized for its lack of transparency by Virginia Gov. Glenn Youngkin. Youngkin also said the process failed to address the declining enrollment of the 23-college system, The Associated Press reported. Youngkin asked the board to restart its search earlier this year, but the board did not do so and announced Kavalhuna’s hiring. “We are disappointed, of course,” NL Bishop, chair of the VCCS State Board, said in a release. “Russ is an outstanding educator and leader in workforce development. We were looking forward to his joining us, but we respect his intent to remain in Michigan. We wish him well.” The Virginia system oversees 23

colleges across 40 campuses, which have combined enrollment of more than 200,000 students. In his time at HFC, Kavalhuna was credited with the college’s new strategic plan and the first enrollment increase in 10 years before the COVID-19 pandemic began. Kavalhuna originally said his decision to leave HFC was a difficult one, but VCCS offered a good opportunity. “It was a hard decision for me to leave the College. In the end, I could not turn down this opportunity to continue expanding the mission of access to life-changing education,” Kavalhuna said in a March news release. According to AP, Youngkin and Kavalhuna met in mid-May but details of the meeting were not shared. A spokesperson for HFC, Rhonda DeLong, provided a statement that was read at Monday’s board meeting confirming Kavalhuna is negotiating to stay on, with negotiations expected to conclude at the end of the month. DeLong said HFC will not be answering questions or taking interviews until the negotiation process has ended. VCCS said it is restarting its chancellor search immediately. Current Chancellor Glenn DuBois is retiring at the end of the month. Contact: amelia.benevides-colon@ crain.com (313) 290-2269; @benavides_colon

BY JON SPRINGER | AD AGE

Little Caesars will replace Pizza Hut as the NFL’s pizza sponsor in a deal executives at the Detroit-based chain say is a touchdown for its brand strategy. The agreement includes a set of exclusive rights to leverage league marks and participate in official events. Little Caesars would be the third pizza chain to inhabit the “official pizza” designation over the last five years: Pizza Hut has been the official NFL Pizza sponsor since 2018, when it took over from Papa Johns. Terms of the new agreement between Little Caesars and the NFL were not disclosed. Pizza Hut, a division of Yum Brands, did not immediately respond to a request for comment. The Little Caesars deal comes only weeks after its chief marketing officer, Jeff Klein, announced he was departing for a similar role at Popeyes Louisiana Chicken. Greg Hamilton, senior vice president of marketing for Little Caesars and the chain’s interim CMO, in an interview said the NFL deal represented a “huge” opportunity for the chain to reach the league’s dedicated audience of more than 100 million fans who are also enthusiastic pizza eaters. It will deliver messages around convenience and product quality — reflecting strategic areas of focus for a chain perhaps best known for value. “We were looking for the best way to enhance the sales momentum that we’ve seen for the past several years, and we believe [the NFL partnership] was really consistent with our strategy,” Hamilton said. “We’re going to focus on greater exposure of our brand from

Little Caesars will replace Pizza Hut as the NFL’s pizza sponsor.

a taste and quality perspective, as well as creating greater utilization of our digital channels. We know the NFL will be really effective at reaching a wide audience … and we realized it was incredibly synergistic to what we were trying to do. “There are probably some people who will be reintroduced to the brand for the first time in a long time as a result of this partnership,” Hamilton added. Little Caesars is a private company that does not release sales data. It refers to itself as the world’s third-largest pizza chain, with stores in each of the 50 U.S. states and 27 countries and territories. Little Caesars has leveraged sports coalitions and the NFL in the past to deliver its big messages. A prior deal as an official NHL sponsor — along with a 2020 Super Bowl commercial — helped the brand get the word out about a newly launched delivery plat-

form. (Little Caesars remains an official NHL sponsor in Canada. Its founder and controlling family-run parent Ilitch Holdings Inc., also owns the NHL’s Detroit Red Wings and MLB’s Detroit Tigers). The brand, whose creative agency of record is McKinney, has devoted considerable investment toward digital media in recent years, Hamilton said, which supports various areas of focus like delivery and pickup. But in a fragmenting media world, live sports are among the few properties that can deliver big TV audiences, Hamilton noted, and the NFL is the most powerful of those. “Our brand is digitally heavy in terms of investments, but we also understand the power of traditional television,” he said. “A lot of that power now resides in the sports space — more than it has ever has before. ... We feel it’s going to be a great place for us.” From Advertising Age JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 13

EXCELLENCE IN HR AWARDS

` Overall Excellence: YMCA of Metropolitan Detroit. THIS PAGE

` Managing Change: Michael Dixon. PAGE 16

` Finding and Growing Talent: Lee Industrial Contracting. PAGE 19

` Overall Excellence: Easterseals Michigan. THIS PAGE

`Employee Experience: GSTV. PAGE 18

` DEI: Kelly Jackson. PAGE 20

` Employee Experience: Brooklyn Outdoor. PAGE 16

` Managing Change: April Lynch. PAGE 18

` Finding and Growing Talent: Michelle Wisner. PAGE 20 ` DEI: Dawn Foods. PAGE 22

LEARNING A NEW LANDSCAPE A HR leaders navigate a changing workplace amid shifting expectations

fter two years of pandemic pivoting, human resources professionals are at the vanguard of another major shift in how we do business. Call it the Great Resignation, the Great Reshuffle, the Great Reset or whatever you like — what workers expect from their workplace is changing, and HR leaders are

again figuring it out as they go. One thing that’s key, based on everything we heard from this year’s Excellence in HR Awards winners: Listening to your people. Really listening. And then putting what you heard into action. This year’s winners were selected from nominations by Crain editors

OVERALL EXCELLENCE / HR TEAM OF THE YEAR

and a judging panel of experienced HR professionals and former Excellence in HR Award winners: ▶ Nichole Shaya, Senior Manager, Human Resources, RouteOne LLC ▶ Johannah Schiffer, Director, People at Telemus; Owner, SchifferHR ▶ Sean Vanderelzen, Chief Human Resources Officer, Lineage Logistics

OVERALL EXCELLENCE / HR TEAM OF THE YEAR

Easterseals Michigan

Ariel Wilkerson (left), association director of diversity, inclusion, equity, global; Darcie West, senior vice president, human resources; Emily Hopper, human resources director; and Anna Rhein, payroll administrator.| YMCA OF METROPOLITAN DETROIT

YMCA of Metropolitan Detroit In the wake of COVID, the YMCA of Metropolitan Detroit essentially had to shut down for about seven months, only providing essential services such as food distribution. Consequently, revenue fell 55 percent and the nonprofit drastically cut its staff of 1,400. Reopening under those constraints required the human resources team to rethink how it went about recruiting and retaining workers. “The cost of retaining a full-time employee is a lot less than recruiting and the cost of maintaining part-time staff,” said Darcie West, senior vice president of human resources and chief human resources officer for Metro Detroit’s YMCA. With this in mind, West’s team of three found ways to combine some of its part-time positions into fulltime roles. If three people worked part time doing the same thing, they combined those jobs into one 14 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

40-hour-a-week job and provided the employee with full-time benefits. “It became an attraction tool,” West said. The Y created a full-time maintenance job, 14 new full-time child care positions and 21 full-time aquatics jobs. The latter allowed the nonprofit to double pool hours and attract 3,000 more people. To retain employees, the Y enhanced incentives. “It’s much more beneficial to retain our staff with better benefits, such as investing in their retirement fund,” West said. In part, the Y increased retirement contributions for vested employees to 10 percent, increased entry-level wages by at least 3 percent, started holding monthly town hall meetings (virtually, at first) with staff and key leaders, and hired a director of Diversity, Equity, Inclusion and Global. In addition, part-time staff now

receive free family YMCA memberships and a 25 percent discount on child care and other programs. The HR team’s work paid off. In 2021, the Y hired 365 new employees, rehired 280 former employees, distributed food to 40,000 Metro Detroit residents and continued providing child care, summer camp, health and wellness and youth development services. West joined the YMCA 30 years ago as a volunteer, eventually began teaching swim classes part time and then moved to the membership and business side of the operation. “It’s a wonderful place to build a career. There’s so much variety in the types of jobs we have available. A staff person can learn multiple areas, and we can cross-train,” said West. “We also fulfill a phenomenal mission within the community we serve.” — Leslie D. Green

Easterseals Michigan has been named among the Best & Brightest Companies to Work For in Metro Detroit and West Michigan for the past five consecutive years because “culture eats strategy for breakfast,” said Easterseals HR Director Jackie Hooper. The nonprofit has 560 employees who strive to help people with disabilities and special needs and their families have better lives. Hooper said that mission helps on the recruitment front, but the culture helps the organization meet its goals. After hiring agency Hunch Free to help develop a recruitment and retention campaign, the nonprofit began examining the entire employee experience, from hiring and onboarding to retirement. “We wanted to streamline those processes and help us develop a career page(on our website) that makes applying to positions easy and highlights our culture and some of the unique benefits we offer,” Hooper said. Leadership asked employees what Easterseals needed to prioritize. Staff members requested remote and hybrid work models, telehealth, help with student loans, tuition reimbursement and generous leave programs. Leadership listened. “Folks couldn’t use all of their time off,” Hooper said. “So, we partnered with a PTO exchange so that employees could, based on their years of service, convert unused PTO time into dollars at the end of each fiscal year. Time can be exchanged for additional 401(k) contributions, student loan payments, tuition reimbursement, their HSA or PTO they roll over.” Other retention and recruitment programs include trauma-informed workforce management to help prevent burnout and promote staff wellness. That means holding sensitivity and response training, employee wellness check-ins and a $125 incentive for employees to take five

Jackie Hooper

consecutive days off. Easterseals also provides free 401(k) education and financial planning and helps staff with credit management. The nonprofit looks for other ways to show its commitment to its employees as well. Early in the pandemic, COVID mandates required Easterseals to cease some of its programs. However, Hooper said, Easterseals didn’t lay off anyone. Instead, it found staff opportunities in other programs or “leased them” to other organizations that needed help. “More people are leaving the behavioral health workforce than ever before, and the rising cost of staff turnover could have been detrimental to our mission,” said Easterseals CEO Brent Wirth. “Without the HR team’s inclusive approach, innovative thinking and steadfast commitment to supporting the health and wellness of our employees along with the people we serve, our retention rates would not exceed the industry standard, and we would not have been able to grow to meet the demand of the mental health crisis facing our community. Instead, in an extremely challenging hiring environment, our staff has grown 20 percent since April 2020.” — Leslie D. Green

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Brooklyn Outdoor In 2019, Detroit-based out-ofhome ad agency Brooklyn Outdoor set out to improve company culture and enhance employee satisfaction and business performance. “One of the things that we’ve really strived to build at Brooklyn Outdoor is an environment where people feel they belong, where they are comfortable sharing their voice and feel heard and where they know they are making an impact,” said Alissa Wilde, the company’s director of finance and people operations. “This creates efficient and engaged employees, who are united toward a common goal.” Based on staff feedback, leadership established cost-of-living raises and flexible work schedules, designed tier-based bonuses, instituted a companywide mental health awareness day, created a peer recognition program and implemented monthly anonymous surveys that gave employees a chance to voice their opinions comfortably. “Most impactful for our team is the open and horizontal communication we have tried to create, allowing employees to bring their ideas to the table,” Wilde said. The surveys seek feedback on issues such as workplace satisfaction, employee accountability, management direction and more. Wilde said leadership has used the feedback to try productivity enticements and institute nontraditional paid holidays, such as Juneteenth and a mental

Alissa Wilde

Candice Simons

health awareness day. For the latter, they close the office and encourage every employee to “disengage and disconnect” from work. “Humanizing your employees truly brings the greatest return as they are the face and core of your company. It is not only about what they can do for you, but also about how you can support them to achieve their dreams,” said Brooklyn Outdoor President and CEO Candice Simons. When it became clear in the second quarter that the company would reach its 2021 sales goal, leadership began providing additional incentives — in the form of

paid time off, bonuses, gift cards and charitable donations — to achieve other goals. Their reward for exceeding 2021 sales goals was an all-expense paid staff retreat to Palm Springs, Calif., where leadership treated them to a private chef, equine therapy, massages and more. “It was great celebrating the success of the team,” Wilde said. Brooklyn Outdoor’s company culture has earned it several honors, including Ad Age’s 2019 Best Places to Work and Kudos’ 2021 Best Culture Innovator. — Leslie D. Green

MANAGING CHANGE

Michael Dixon Vice President of Human Resources, Beaumont Health Michael Dixon learned at a young age that “things could be worse.” His mother died when he was young, and he was the only child of a single father. Growing up, he realized that he needed to look for the positives in life. Even in challenging circumstances, his “glass half full” attitude carries over into his work and relationships. “I have to dig deep and try to put my personal beliefs aside for my organization, my team,” Dixon said. He is vice president of HR for Beaumont Royal Oak hospital and Beaumont Medical Group and interim VP of HR for Beaumont Troy and Grosse Pointe Hospitals, making him responsible for 14 immediate reports and nearly 20,000 employees. “He’s a solid leader with an engaging personality,” said Nancy Susick, president of Beaumont Royal Oak. “You would think he knows every employee by the way he engages positively with them, and he frequently gets called the ‘Mayor of Beaumont, Royal Oak,’” she said. “He also enjoys having fun, serving ice cream or hot chocolate for staff appreciation, or being a judge in the pumpkin decorating contest.” Dixon calls himself an ambassa-

Michael Dixon

dor of change. He started at Beaumont in 2000 as an employment representative and became director of human resources for Beaumont Royal Oak in 2011. Through the health system’s partnerships with Oakwood and Botsford hospitals and, more recently, with Spectrum Health, he strives to keep people positive and help them understand the business reason behind the changes. “It’s like creating a new company,” Dixon said. “We became a family of

eight rather than a family of three.” In 2019, Dixon helped the health system navigate the resignation of its Royal Oak president and other executives while dealing with a nurses’ union organization campaign. In 2021, the impending merger with Spectrum resulted in the departure of additional leaders. During the height of the COVID pandemic, Dixon led HR teams in implementing and communicating mask, social distancing and vaccine requirements. In 2021, he championed bringing Goodwill’s SURGE program to Beaumont, Royal Oak. The initiative provides on-site contact and resources for employees with home-life issues that impact their ability to work. In addition, Dixon advocated for benefits, including retention bonuses, tuition reimbursement and a new employee recognition program to combat staffing shortages. A champion of diversity, equity and inclusion, he also developed relationships with the NAACP, Black United Fund, Arab Chaldean Community, ACCESS and others. In part, these relationships led to helping the health system provide myth-busing education about COVID and vaccines. — Leslie D. Green

We’d like to congratulate our amazing

HR TEAM

for their much-deserved recognition. Their dedication to our team and the people we serve help to make our organization a place to build a rewarding career. We couldn’t do what we do without them.

If you are interested in a career at Easterseals Michigan, go to www.EastersealsMichiganJobs.com or scan the QR code.

FOCUS | EXCELLENCE IN HR AWARDS EMPLOYEE EXPERIENCE

MANAGING CHANGE

GSTV

April Lynch

“When torn between paths of whether we follow the best interest of GSTV or the best interest of the team member, where we can, we’re always going to side with a team member. It may not always be the best case for GSTV, but we’re going to support our employees,” said GSTV Vice President of Human Resources Amy Ratliff. GSTV, a national video network serving 28,000 fuel retailers, employs 124 people. When Ratliff joined the company, it wasn’t focusing on employee engagement or open communication. Since then, she said, it has become “high-touch, high-value and high-tech. “Our CEO (Sean McCaffrey) really wants to understand the thoughts and feelings of our employees and what we’re not doing and should be doing or things we are doing that we shouldn’t be doing so he can make changes,” Ratliff said. Changes might be improved technology, additional staff or how the company operates “day in and day out,” she said. Improving the employee experience also meant overhauling

Deputy Executive, Oakland County

Amy Ratliff

Destiny Crawford

Leah Manges

GSTV’s benefits package. The company increased its 401(k)-match program and PTO and added paid parental leave for anyone having a baby, adopting or newly fostering a child. It also added departments, increased staff by 26 percent to alleviate employee strain, developed an open-door policy and began holding one-on-one meetings between employees and Ratliff. In addition to four weeks of PTO and 12 federal holidays off, the HR department began emphasizing the importance of downtime and self-care by shut-

ting down the office on the first Friday of every month. “Everyone is so grateful for those self-care days when they can disconnect for a little bit,” said GSTV HR Manager Destiny Crawford. “We exceed our goals because of our teams.” To further engage employees, the HR department has held fun social events, such as co-worker feud and virtual bingo, and developed quarterly social responsibility programs, such as fundraisers for Black Girls CODE and Susan G. Komen for the Cure and a food drive for Feeding America.

“Our Human Resources team has worked diligently this past year in helping to grow our business, increase our engagement and drive GSTV’s culture. The team has created a culture of empathy, caring and openness that allows our team members to feel like family. Their efforts have led to a significant impact on the growth of our business and overall experience for the GSTV Family,” McCaffrey said. GSTV was named one of Crain’s Cool Places to Work in 2020. — Leslie Green

April Lynch knew she was taking on sizable responsibilities when she left her job as Ferndale’s city manager in September 2019 to become deputy executive of Oakland County. The county supports 1.2 million residents and 39,000 businesses in 62 cities, and Lynch became responsible for its human resources, risk management, facility operations and environmental sustainability initiatives. At the same time, Oakland County was going through significant leadership changes. L. Brooks Patterson had died a month earlier after serving as Oakland County executive for nearly three decades. The new county executive, former Ferndale mayor David Coulter, brought new ideas and philosophies. It was Lynch’s job to help county employees adjust to these changes. Then, six months into Lynch’s new role, COVID struck. “We had to change the way we did business,” she said. “We moved people home and were providing more services online. The courts had to figure out how to hold Zoom hearings. I mean, just about everything you could possibly think of for government was affected.”

BEAUMONT HEALTH CONGRATULATES MIKE DIXON VICE PRESIDENT OF HUMAN RESOURCES

2022 Crain’s Detroit Business Excellence in HR Award Winner in the Managing Change category

18 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

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FOCUS | EXCELLENCE IN HR AWARDS FINDING AND GROWING TALENT Under Lynch’s direction, people shifted jobs to support the community and COVID mitigation. For example, HR transformed into a hotline response center to help with employee and resident concerns and contact tracing. At the same time, many employees created and distributed supply bags with hand sanitizer and masks for businesses to give to their employees and supported schools trying to feed kids stuck at home. “It was all hands on deck,” she said. “But we were also watching the employees’ stress and trying to keep in mind that it was hard for them. We tried to support them as best as we could.” Another big change is on the horizon for Oakland County: the impending retirement of a third of the county’s employees over the next five years. Lynch has helped the county’s departments develop succession plans and to prepare for the change in their workforce and loss of institutional knowledge. Her team also provided mental health support to employees impacted by the shooting at Oxford High School in 2021. “Oakland County is an organization of more than 5,000 employees that was run in a very specific way for 27 years, so when a new administration comes with a different style and

Lee Industrial Contracting

April Lynch

culture, it can breed uncertainty and fear. With April’s experience and skills, employees know that they can and will be part of the decision-making process as we move forward,” said Coulter. Lynch, who is the chief negotiator for 10 unions, is also working toward establishing a culture in county government that supports diversity, equity and inclusion through recruiting changes and training. In 2020, she hired the county’s first chief DEI officer to help build bridges among employees. — Leslie Green

Lee Industrial has provided foundation, rigging, electrical, mechanical and other related maintenance and repair services to auto, aerospace, energy and other heavy industries since 1989. Lee is employee-owned and has nearly 500 people on staff. Krista Fish, Lee’s chief administrative officer, joined the company six weeks after COVID mandates required many businesses to shut their doors. “Throughout the pandemic, we faced a labor shortage because the demand for skilled trades grew exponentially. As a leadership team, we recognized the talented group of employees we had and took actions to ensure we could retain them,” Fish said. Those actions increased their headcount by 12 percent in the past three years. Efforts have included enhancing benefits, such as adding short-term disability, life insurance and an employer contributed HSA account, overhauling the PTO policy, expanding opportunities for remote work and providing more incentives for “good work practices.” “Every employee, after working 1,000 hours and one year, gets shares

Krista Fish

of stock in the company. This gives them an opportunity to affect the share price, valuation and how we run,” Fish said. Lee also implemented educational components, including Department of Labor-approved apprenticeships for electrical and pipe-fitting careers in partnership with Macomb Community College. Partnerships have helped with recruitment, Fish said. In 2021, the company became a

corporate partner of the Talent Development Coalition, which trains and provides experience for people in under-represented populations to break the cycle of poverty, and works with the Michigan Works Association and Habitat for Humanity to get the word out about training opportunities. Lee also received a grant from the Michigan Department of Labor’s Going PRO Talent Fund to provide enhanced training and continuing education internally. In the last three years, Lee’s apprentices earned 60 percent of the company’s entry-level trades positions, and the company filled 63 percent of its cost estimator and project management positions internally. “As we start 2022, we are committed to 25 new training classes to upskill our current employees. We have also undertaken a six-month operations project that will deliver process training to our management and construction professionals,” Fish said. “To help with that initiative, we have recently hired a director of Training and Development. We are now in an excellent position to solve the talent shortages and develop our current workforce.” — Leslie D. Green

DEVELOPING PROFESSIONAL PATHWAYS FOR ALL Congratulations, Kelly Jackson, Director of Human Resources

2022 Crain’s Excellence in HR: Diversity & Inclusion Awardee As a firm Principal and its Human Resources Director for over 25 years, Kelly has been an integral member of the leadership team, helping navigate major organizational changes and rapid employee and geographic office growth while always striving for excellent workplace culture. Paired with Kelly’s extensive HR knowledge and experience is her devotion to the firm’s DEI practice. She was instrumental in the firm’s signing of the CEO Actions for Diversity & Inclusion™ Pledge, the creation of its annual Diversity Scholarship to support future generations of diverse industry professionals, and the launch of its robust internal DEI program for nearly 700 employees. We at OHM Advisors, the community advancement firm, are grateful to Kelly for her contributions to building an open, supportive workplace for all.

LEARN MORE ABOUT KELLY AND HER IMPACTFUL WORK

OHM-Advisors.com JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 19

FOCUS | EXCELLENCE IN HR AWARDS DIVERSITY, EQUITY AND INCLUSION

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When she started working at OHM Advisors 28 years ago, Kelly Jackson was the billing clerk. Back then, the architectural, engineering and planning firm didn’t have an HR department. After realizing that accounting wasn’t the field for her, Jackson earned her bachelor’s degree in business administration and asked the company president if she could lead OHM’s HR department. OHM has since grown from one office to 17 offices in four states and to 600 employees from 80. In 2017, diversity, equity, inclusion and belonging came under Jackson’s purview. “Our past president, John Hiltz, was going to different CEO roundtables and noted that our mission is advancing communities, and we have to advance it for everybody. He said, ‘If I don’t understand the concerns of the people who live in the cities and municipalities where we do business, how can I be their consultant?’ That was the inflection point of OHM on the journey for DEI&B (diversity, equity, inclusion and belonging),” Jackson said. “If you know (Kelly), you know how much she does for the firm, and you know that growth seems to be in her DNA. She has extensive experience in HR development

Kelly Jackson

and compliance, strategic diversity leadership and management training and development. And since 2017, she has been passionately devoted to OHM’s diversity, equity and inclusion efforts and instrumental in my signing of the CEO Action for Diversity & Inclusion Pledge,” said John Hiltz, OHM executive director and board chair. Jackson took an even more active role in the company’s DEI&B

program after the murder of George Floyd in 2020, she said. Rather than putting the company’s position in a statement, she works to ensure they actively make necessary changes. They started with having someone not only come talk about unconscious bias in general but how it relates to the work OHM does. “We can identify different nuances in how we show up, whether with our race, religious beliefs or sexuality. But also have different perspectives, diversity of perspectives. You aren’t going to trust or feel engaged if you don’t feel like you belong. You need to feel you can contribute to the team in your uniqueness. So, we started listening sessions,” Jackson said. She also championed the company’s STEM scholarship program, which awards funds to qualified women and minorities, and implemented a rigorous college outreach program to attract and recruit talent from Historically Black Colleges and Universities. Jackson’s leadership has helped OHM garner multiple workplace excellence honors, including the 2020/2021 Gallup Exceptional Workplaces and Crain’s Cool Places to Work awards. — Leslie D. Green

FINDING AND GROWING TALENT

Michelle Wisner Director of Human Resources, Pleasantrees Cannabis Co.

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20 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

Pleasantrees Cannabis had fewer than 60 employees when Michelle Wisner joined the company in June 2020. In under two years, she has found, interviewed and recruited more than 180 employees, who are now working in multiple locations, including five Metro Detroit-based and two Massachusetts-based retail businesses and an 80,000-square-foot cultivation and processing facility in Harrison Township. Though she started the hiring process by herself, she realized she couldn’t recruit the talent needed for the fast-growing company alone. “We experienced tremendous growth from an employee standpoint,” Wisner said. “I needed to understand what would make a great employee within each department. And I had to come up with a process and plan — templates and tools — to teach leaders to evaluate candidates and do interviews as well. I sat with leaders to help them ask the follow-up questions that would make sense for people working in their departments.” Hiring staff for the company’s

Michelle Wisner

Massachusetts-based operations required Wisner to learn vastly different employment laws, create a second employee handbook, bifurcate payroll functions and workers’ compensation policies and develop and implement a separate set of COVID-related safety policies. “Starting a new business is hard. Starting a new business in the federally illegal emerging cannabis industry is really hard. I can say without a shred of a doubt that I would not have survived these past two years without ‘Wiz,’ as she is affectionately known,” said

Benjamin Sobczak, Pleasantrees chief legal officer and Wisner’s supervisor. “Wiz is the heart of our company. She ensures that our employees are cared for and that their needs are met. She ensures that compassion and understanding are woven into every decision we make.” Wisner seeks to help leaders recognize talent within the company as well. “I help them determine what kind of soft skills an employee needs and how we can develop those so we can promote internally first. When a position opens up, they can apply and move into that position without interviewing external candidates. “The greatest compliment a leader can have is to watch an employee grow, develop in their role, move into a leadership position and know you had a positive impact on their career.” Before joining Pleasantrees, Wisner was executive team leader of HR for Target in Novi, a $35 million store with more than 160 employees. — Leslie D. Green

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FOCUS | EXCELLENCE IN HR AWARDS DIVERSITY, EQUITY AND INCLUSION

Dawn Foods

Leadership at Dawn Foods, a bakery manufacturing and ingredients distribution company in Jackson that employs more than 3,500 people, reviewed staff engagement scores and surveys and saw gaps in how well they focused on their employees. As a result, they decided to become more intentional about developing a people-first strategy. “At the end of 2018 or early 2019, we did a diversity audit,” said Felisa Stockwell, senior director of Global People & Culture. “The results from that sort of helped us understand, at a high level, some of our opportunities and where we should start to focus.” After dealing with the initial disruption of COVID, Dawn launched its initiative with e-learning and then trainthe-trainers sessions, said Kevin Elder, Dawn’s director of People & Culture. The plan was to educate and engage employees to help them to understand bias better and be more inclusive in thought and deed. “Team Dawn” engaged in more than 1,800 hours of DE&I training last year. In addition to traditional training, they offered live sessions where staff shared their experiences and discussed ways to create a more inclusive culture. Subsequently, they developed additional programming based on the ideas employees presented.

Kevin Elder, Jason Lioy, Felisa Stockwell and Candyce McArthur | DAWN FOODS

In October, Dawn’s Global People & Culture team launched its “I AM” campaign. “I AM” encourages people to post selfies and share some-

thing that defines them to allow everyone to learn about their colleagues more deeply. “It’s one thing to launch a program

and another to have leadership, board members and the family sharing very personal details. We had people say, ‘I am someone who

struggles with anxiety.’ ‘I am someone who struggles with ADHD.’ ‘I’m somebody who struggles with dyslexia.’ We had somebody who’s very high up in the organization say, ‘I am the son of a gay man who died of AIDS.’ That information connects people on a personal level and takes D&I to a whole other level,” said Chief People Officer Jason Lioy. Employees from all over the world began emailing Lioy when he shared his struggle. It’s a connection, he said, he would never have made otherwise. Another Dawn employee came up with the idea of discussions around code-switching — changing one’s manner of speaking, appearance or behavior to make other people more comfortable. The Global People & Culture team recruited employees to share their stories using a template of questions. “We weren’t trying to be provocative but wanted to find something that would be impactful,” said Stockwell, “Then we could talk about it and break down barriers.” So far, Dawn’s DE&I efforts have increased team member engagement by more than 10 percentage points. “We want to make sure we are very purposeful,” Lioy said. “We don’t want it to feel like a program but for people to understand what people deal with every day.” — Leslie D. Green

REAL ESTATE

Metro Detroit housing market tight, but calmer in May BY ARIELLE KASS

The fundamentals of the housing market didn’t change drastically in May, but there is one difference, RE/ MAX of Southeastern Michigan President Jeanette Schneider said: less alarm. “The numbers aren’t wildly different from last year, but the feel of the market is,” Schneider said. “If (buyers) have been at this a little bit, they’ve realized, ‘I don’t need to panic.’ Last year, they panicked. When you bring that emotion to a showing, everything ratchets up.” Now, she said, patience and prudence are the name of the game, as inventory starts to increase in some communities while both interest rates and sales prices continue to rise. Both RE/MAX and Realcomp, the multiple listing service, released their May figures last week. RE/MAX showed home sales in Livingston, Macomb, Oakland and Wayne counties down 6.8 percent in May from the year prior, to 3,533 homes sold, and median prices up 6.4 percent, to $293,500. Realcomp, which covers a broader geography, showed a 6.7 percent decrease in sales for May, to 10,466, and a 10.8 percent increase in median sales price, to $254,900. While multiple offers are still the norm, Al Block, the broker/co-owner of RE/MAX First and a member of Realcomp’s Board of Governors, said sellers are getting six offers now, instead of 12. People who are happy with where values are now are continuing to sell, even as interest rate hikes begin to mean they’ll get less house for their money going forward. 22 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

“There’s still too many people that want to buy a house,” he said. “We’re not going to have a glut of inventory any time soon.” But Block, too, said offers aren’t as high as they once were and guarantees from buyers are taking a step back, too. In Detroit in particular, activity remains strong. RE/MAX notes a 13.5 percent increase in sales since last May and an 18.1 percent increase in price, to $76,752. Realcomp’s numbers show similar growth, with a 13.9 percent increase in sales and a 21.3 percent increase in median sales price, to $84,000.

“This has been good for Detroit,” Herb Strather, president of the Detroit Association of Realtors, said of the housing market. “The demand is greater than the supply.” Strather said there’s “great buoyancy in the marketplace,” even as abandoned homes and empty blocks persist. He said he hopes the continued interest in the city will allow Detroiters to become more active. Supply is up in Detroit, too, with listings up 45.4 percent in May over a year ago, according to Realcomp numbers. Schneider, with RE/MAX of Southeastern Michigan, said there are pockets where more listings are

coming online, but it’s not yet prevalent everywhere. In addition to Detroit, she’s seeing it in Macomb in particular, she said. “There’s clearly interest in Detroit because homes are selling,” she said. And now, she said, buyers who are in the market are serious — and there are fewer of them. Block said higher interest rates will continue to move people out of the market, though demand remains. “It’s about affordability,” he said. “I don’t see anything in the short run changing. ... If a house is priced well, looks right, buyers are buying it.” How home sales fared in February

by county, data from Realcomp: ` Wayne County: Home sales decreased 4.6 percent, falling to 1,757 from 1,842 in May 2021; median sale prices rose 5.6 percent from $180,000 to $190,000; inventory rose 20 percent year-over-year from 2,673 to 3,208 homes on market. Days on market fell 12.5 percent from 24 to 21. ` Oakland County: Home sales decreased 12.3 percent, falling to 1,695 from 1,933 in May 2021; median sale prices rose 7.5 percent from $316,250 to $340,000; inventory rose 6 percent year-over-year from 2,104 to 2,230 homes on market. Days on market fell 28.6 percent from 21 to 15. ` Macomb County: Home sales decreased 1.3 percent, falling to 1,158 from 1,173 in May 2021; median sale prices rose 6.8 percent from $220,000 to $235,000; inventory rose 19.5 percent year-over-year from 1,073 to 1,282 homes on market. Days on market fell 11.1 percent from 18 to 16. ` Livingston County: Home sales decreased 16.6 percent, falling to 242 from 290 in May 2021; median sale prices rose 13.4 percent from $335,000 to $379,900; inventory rose 7.8 percent year-over-year from 345 to 372 homes on market. Days on market fell 36.7 percent from 30 to 19. ` Washtenaw County: Home sales were flat with 476 homes selling in both May 2022 and 2021; median sale prices rose 15.1 percent from $350,000 to $402,700; inventory dropped 14.2 percent year-over-year from 885 to 759 homes on market. Days on market fell 27.3 percent from 22 to 16. Contact: arielle.kass@crain.com; (313) 446-6774; @ArielleKassCDB

CRAIN'S LIST | MICHIGAN ACCOUNTING FIRMS Ranked by number of Michigan employees (includes Southeast Michigan employees) NUMBER OF EMPLOYEES SOUTHEAST MICHIGAN JUNE 2022/ 2021

NUMBER OF MICHIGAN EMPLOYEES ENGAGED IN AUDIT/ ACCOUNTING

NUMBER OF MICHIGAN EMPLOYEES ENGAGED IN TAXES

NUMBER OF MICHIGAN EMPLOYEES ENGAGED IN CONSULTING

NUMBER OF MICHIGAN EMPLOYEES ENGAGED IN OTHER

NUMBER OF CPAS MICHIGAN JUNE 2022/ 2021

COMPANY ADDRESS PHONE; WEBSITE

MANAGING PARTNER(S)

NUMBER OF EMPLOYEES IN MICHIGAN JUNE 2022/ 2021

PLANTE MORAN PLLC

James Proppe

1,739

1,280 1,295

433

344

475

487

696 695

DELOITTE LLP AND SUBSIDIARIES

David Parent

1,612

1,407 1,095

514

230

578

290

325 309

ERNST & YOUNG LLP

Angie Kelly, Detroit; Jay Preston, Grand Rapids

944

812 787

301

259

284

100

341 338

PRICEWATERHOUSECOOPERS LLP

Ray Telang

821 e

770 e 735 e

331 e 316 e

REHMANN

Ryan Krause

715

306 292

183

207

108

217

245 241

BDO USA LLP

Matt Manosky, Kevin Patterson

712

207 177

129

248

291

211 201

UHY LLP

Thomas Callan

508

485 435

140

176

114

200 196

KPMG LLP

Kevin Voigt

432

322 311

115

192

89 87

DOEREN MAYHEW & CO. PC

Chad Anschuetz

385

285 277

186

178 126

CROWE LLP1

Travis Ward

222

0 0

74 77

ANDREWS HOOPER PAVLIK PLC

Traci Moon

160

28 30

63 70

YEO & YEO PC

Dave Youngstrom

156

35 33

70 76

MANER COSTERISAN PC

Edward "Trey" L. Williams III

143

3 4

56 56

RSM US LLP

Greg Burnick

108

108 90

31 29

GRANT THORNTON LLP

Jim Tish

100

100 86

44 44

BAKER TILLY US LLP

Patrick Killeen

96 81

29 30

CLAYTON & MCKERVEY PC

Robert Dutkiewicz

65 69

38 37

DERDERIAN, KANN, SEYFERTH & SALUCCI PC

Ursula C. Scroggs

60 55

37 34

GORDON ADVISORS PC

Paul Arment, Maureen Moraccini

60 64

30 31

COLE, NEWTON & DURAN CPAS

Christopher Boloven

53 e

50 e 48

24 e 23

COHEN & COMPANY

Christopher Bellamy

50 54

22 28

CROSKEY LANNI PC

David Croskey

50 e

NA NA

EHTC (ECHELBARGER, HIMEBAUGH, TAMM AND CO. P.C.)

David Echelbarger

0 0

22 18

MRPR GROUP PC

Angela Mastroionni

47 50

23 27

MATTINA KENT & GIBBONS

William T. Gibbons Jr

22 24

16 18

3000 Town Center, Suite 100, Southfield 48075 248-352-2500; plantemoran.com 200 Renaissance Center, Suite 3900, Detroit 48243-1895 313-396-3000; deloitte.com/us/en.html 777 Woodward Ave., Suite 1000, Detroit 48226 313-628-7100; ey.com 500 Woodward Ave., Detroit 48226 313-394-6000; pwc.com

1500 W. Big Beaver Road, 2nd Floor, Troy 48084 248-952-5000; rehmann.com 2600 W. Big Beaver Road, Suite 600, Troy 48084 248-362-2100; bdo.com 230 E. Grand River Ave., Suite 700, Detroit 48226 313-964-1040; uhy-us.com 150 W. Jefferson Ave., Suite 1900, Detroit 48226 313-230-3000; kpmg.com 305 W. Big Beaver Road, Suite 200, Troy 48084 248-244-3000; doeren.com 55 Campau Ave. N.W., Suite 500, Grand Rapids 49503 616-774-0774; crowe.com 5300 Gratiot Road, Saginaw 48638 989-497-5300; ahpplc.com

5300 Bay Road, Suite 100, Saginaw 48604 989-793-9830; yeoandyeo.com 2425 E. Grand River Ave., Suite 1, Lansing 48912 517-323-7500; manercpa.com 719 Griswold St., Suite 820, Detroit 48226 313-335-3900; rsmus.com 27777 Franklin Road, Suite 800, Southfield 48034 248-262-1950; grantthornton.com 2000 Town Center, Suite 900, Southfield 48075 248-372-7300; bakertilly.com 2000 Town Center, Suite 1800, Southfield 48075 248-208-8860; claytonmckervey.com 3001 W. Big Beaver, Suite 700, Troy 48084 248-649-3400; DKSScpas.com

1301 W. Long Lake Road, Suite 200, Troy 48098-6319 248-952-0200; gordoncpa.com 33762 Schoolcraft Road, Livonia 48150-1625 734-427-2030; cndcpa.com 1001 Woodward Ave., Suite 950, Detroit 48226 313-424-4871; cohencpa.com 345 Diversion St., Suite 400, Rochester 48307 248-659-5300; croskeylanni.com 2301 East Paris Ave. SE, Grand Rapids 49546 616-575-3482; ehtc.com

28411 Northwestern Highway, Suite 800, Southfield 48034 248-357-9000; mrpr.com 1214 N. Main St., Rochester 48307 248-601-9500; mkgpc.com

1,689

1,320

913

784 e

682

639

457

376

277

201

168

202

134

Researched by Sonya D. Hill: shill@crain.com | This list of accounting firms is an approximate compilation of the largest such companies in Michigan. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the companies. Companies with headquarters elsewhere are listed with the address and top executive of their main Michigan office. NA = not available. NOTES: e. Crain's estimate. 1. Formerly Crowe Horwath LLP

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data

JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 23

NONPROFITS

Groups say public funds for violence prevention slow in coming Detroit grassroots program leaders say funds exist as part of American Rescue Plan Act BY SHERRI WELCH

Detroit is poised to leverage the success of violence intervention programs that are working around the country, as one of 16 cities designated by the Biden administration to benefit from a federal initiative announced last year. But neighborhood groups working on the issue don’t have the infrastructure and scale needed to make real impact here in Detroit, and public dollars to support violence prevention and intervention work led by those groups has been slow in coming. “We have all these children being murdered and (other) people,” said Ray Winans, founder and chief strategy officer of Detroit Friends and Family, one of the groups that works to prevent and interrupt violence in the city. Public funding would enable groups like Detroit Friends and Family to help victims and violent individuals, he said. People are living in a house on the street where they were shot. Others walking around with guns want to be relocated, to get training and jobs. Winans knows this firsthand: He’s an ex-offender who watched people close to him get killed and did time in prison for second-degree murder before moving into mentoring and violence intervention work. “My DNA is literally in the ecosystem of this community-based violence intervention network,” he said. “When our programs aren’t funded, we know that people are dying.” The funds needed exist as part of American Rescue Plan Act dollars appropriated to local communities including Detroit, community groups and foundations providing support for the work said. But the public resources aren’t getting through to neighborhood groups leading community violence intervention work in Detroit. The White House Community Violence Intervention Collaborative, launched as a targeted effort to help 16 U.S. cities — including Detroit — stem gun violence in the U.S., is encouraging states and cities to invest American Recovery Plan Act dollars in community efforts. After failing to secure more than $5 billion in proposed funding, it has leveraged private, philanthropic commitments to help provide bridge funding for community groups while local appropriations are considered and has begun providing technical assistance to help groups access those dollars. Detroit officials say a plan is in the works to disburse the funds. “The mayor is actively looking at ways to engage others... to help enhance public safety education and just help the city of Detroit improve the overall quality of life for our residents,” Deputy Mayor Todd Bettison said. Winans said frustration is growing among residents and the groups working to end community violence. “City residents see the sense of urgency...but the bureaucracy that comes with government can’t respond to the crisis,” he said. “And the residents need them to.” 24 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

vention, issued recommendations that Detroit needs 351 community intervention activists to help de-escalate violence in the city. Instead, just 45 people attended the training across the primary violence prevention groups. They are the core group working on the issue, along with dozens of volunteers doing impactful intervention work they have to put down in order to pay their bills, said Alia Harvey Quinn, executive director of Force Detroit. “If they are training us right now and we don’t have the people to train, how do we scale this effort to the point where Detroiters are actually safer and free due to the efforts of peacemakers?” she said. A report released by Force Detroit in December suggested a $150 million investment over 10 years would allow violence intervention groups in Detroit to build capacity. “There’s an opportunity to drastically improve community safety outcomes, but our public officials have not made a public commitment to provide ARPA dollars,” Quinn said.

Where is the money?

Ceasefire Detroit interventionist “E” talks with a crowd of people from other local community violence intervention groups during a training this week hosted as part of the White House Community Violence Intervention Collaborative efforts, as Detroit Friends and Family Founder Ray Winans leans on his shoulder. | DETROIT FRIENDS AND FAMILY

Alia Harvey Quinn

A lack of infrastructure Detroit saw slight improvements in crime last year, but the city is still among the most dangerous in the country. There were 309 criminal homicides in the city last year, down 4 percent from the year before. Although the 1,065 non-fatal shootings reflected a 9-percent decrease, according to a Detroit News report. The violence is taking a human and financial toll. Detroit was ranked the third most dangerous city in the country based on FBI crime statistics and the cost of crime per capita in a recent MoneyGeek survey, Forbes reported in February. The ranking pegged the cost of crime per capita in Detroit at $7,292. Violence prevention groups working in Detroit are well-known and well-respected across this ecosystem nationally, said Wendy Lewis Jack-

Todd Bettison

son, managing director of Kresge’s Detroit Program. They know the community and how to get things done in the community. They’ve had proven successes in interrupting violence across the city. “What’s beautiful about these groups is that they were born of community,” she said. “So it’s even more imperative that we find a way to support their general operations and their ongoing work.” Leaders from Washington, D.C., were in Detroit last week to do scenario-based training with people from local violence prevention groups including the city-operated Ceasefire Detroit program and community groups like Force Detroit, Detroit Friends and Family and Detroit Hispanic Development Corp. Based on earlier consultations with the city, the lead administrator for the CVIC initiative in Detroit, Health Alliance for Violence Inter-

Detroit has been funding community violence intervention work done through city-run programs since 2012. It’s provided nearly $3.9 million in general fund dollars to the work over that period, including $775,000 for the current fiscal year, said Corey McIsaac, deputy director of media relations for the mayor’s office. Over the same period, the city has leveraged $520,000 in private foundation support for the city-run program and $2.2 million in federal grants. Separately, the Detroit Employment Solutions Corp. recently made a $400,000 grant to Detroit Friends and Family, funded by the Hudson-Webber Foundation, McIsaac said. Detroit was awarded nearly $826.7 million in ARPA funding, three-quarters of which has since been committed to projects that have bids in process or upcoming, according to the city’s website. It is required to award the funds by Dec. 31, 2024, and see them spent by the end of calendar 2026. The city is “absolutely” considering ARPA investment in community violence prevention and working on a detailed plan to do so, Bettison said, noting it will make recommendations to the city council once it builds out the plan. He gave no hints on when that might be. “We’re working at a fast pace ...to be able to get this done.” Winans said his group and Force Detroit are talking with the city about ARPA funding and the infrastructure that needs to be in place to receive the funding. “They’ve provided hopeful responses,” he said, “but right now, the hopeful response doesn’t save a life.” At the state level, Gov. Gretchen Whitmer in November put forth a proposal for $30 million in community violence intervention statewide, as part of the $75 million MI Safe Communities framework. The funding, which would be used to reduce violence in communities across Michigan by establishing a range of community violence preven-

“MY DNA IS LITERALLY IN THE ECOSYSTEM OF THIS COMMUNITY-BASED VIOLENCE INTERVENTION NETWORK. WHEN OUR PROGRAMS AREN’T FUNDED, WE KNOW THAT PEOPLE ARE DYING.” — Ray Winans, founder and chief strategy officer, Detroit Friends and Family

tion initiatives informed by data and best practices used nationwide, will be negotiated with the legislature as part of the budget process for next year, the governor’s director of communications Bobby Leddy said in an email.

Strengthening the framework In addition to providing scenario-based training and operational support for community groups working on violence intervention and technical assistance to strengthen their organizational capacity, the federal CVIC initiative is also designed to help groups working on community violence pull down bridge funding from contributed philanthropic dollars while cities make ARPA allocations to CVI work, a spokesperson for the CVIC initiative said. Private funders that have come forward with support for local and national community violence intervention work include: Ballmer Group, Hudson-Webber Foundation, Kresge Foundation, Skillman Foundation and W.K. Kellogg Foundation. Foundations are working closely with local CVI groups to make sure that they have access to general operating support and other programmatic dollars, “but the real intent of the White House initiative is to ensure that the cities use their federal dollars to support the ongoing efforts of organizations like Force Detroit and Detroit Friends and Family, Ceasefire and others,” Jackson said. The CVIC initiative is also providing technical assistance to the cities to ensure that they look at how to best allocate the federal resources, she said. “Philanthropy cannot do this alone. And so the importance of the federal dollars is quite critical.” Community-led violence intervention has been proven to be effective and lasting, as opposed to locking people up, said Melanca Clark, president and CEO of the Detroit-based Hudson-Webber Foundation. “Philanthropy is watching closely what’s happening here, and I think that there are a number of us that want to be supportive and already have been with support for community violence intervention,” she said. “But the truth is, whatever we can do collectively is just to help leverage what should be the more substantial investment from the public sector. And that should be an enduring investment that lasts beyond ARPA.” Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

house,” said Heppner, who also said he’s not in a position to buy it. “That was their first real dream home. ... For them, they made it. It was the physical manifestation of his success.” Heppner said he suspects many “Fordophiles” would have trouble affording a nearly $1 million price tag, not to mention the costs to modernize parts of the home. While the house was an important part of history, he said, “it really doesn’t mean much to us today” — especially not without a well thought-out plan to show something about the family that wasn’t available elsewhere. “In my humble opinion, we have enough of those out there,” he said of Ford-related properties. “We’ve done fine without it.”

Modernization

The front entrance at 140 Edison St. in Detroit, the home of Henry and Clara Ford from 1908 to 1915.

| NIC ANTAYA FOR CRAIN’S

HENRY FORD

From Page 3

windows and filled Ford’s parlor with enough folding chairs to accommodate the dozens of worshipers who gathered there on Thursday and Sunday nights.” They lived there from 1941 until the Mitchells bought it in 1985. It wasn’t an easy acquisition, Mitchell said. After the reverend did his reading several times, “the stars never came in alignment.” But the negotiations continued and he was ultimately successful. The church made some changes to the house, Mitchell said, tearing down walls that he put back up and converting the kitchen to a social space. But much of the house, built in 1908, remained intact. Most of the toilets and tubs are original and a sort of intercom system, while not functioning, remains in place. Most of the fixtures, too, are original, Mitchell said. The Fords lived in the house from the time it was built until 1915, when they moved to their Fair Lane estate for more privacy. The Edison Street years coincided with the debut of the Model T and Ford’s decision to offer a $5-a-day wage for workers; they left the house in an effort to gain more privacy after people continuously knocked on the front door asking for jobs, said Mark Campbell, the treasurer and chief operating officer of the Henry Ford Heritage Association and a great-great nephew of Clara Ford. Mitchell said he had always had preservationist tendencies, but was never really into cars — now, he drives only Fords; the driveway was built for a Model T and he can’t imagine non-Ford vehicles in the space.

The house has thick wood, an upstairs ballroom-turned-sitting-area, five bedrooms and four-and-a-half baths and quirks like dusting and sleeping porches and a kitchen flour bin. Clara Ford’s hat boxes are still there, as are ledges in Edsel Ford’s room where he placed his drawings. The home is 7,200 square feet, with a carriage house of about 1,100 square feet that has a bedroom, bathroom, kitchen and living room. “It’s the most historically significant house in Detroit,” Mitchell said. “I hope it continues to be preserved

as a legacy. It would be tragic if the house were to be modernized.” But that’s exactly what some others said should happen. “If you’re going to live there, it should have modern conveniences,” Campbell said of potential buyers. “They should make it their own. The interior should be something you can live in.” That’s what the Flynns expect to happen, too. Frank Flynn said someone who was less married to maintaining the historical accuracy could easily lighten the house up. With work, he said, it could be worth many times what it’s on the market for. “We know what the house is lacking, but it’s an honest house,” he said. “We’re not marketing this as a modern amenity type property. ... We think the next owner will update it in a timeless fashion.” But Mitchell, still, said he thinks beautiful, historic things should be preserved. Getting the house in the shape it’s in has “always been an uphill battle, but with some great successes,” he said. “People had forgotten about this place,” he said. “I don’t mind passing it on, because I’ve done enough. If it passes to the right hands, it would be beautiful. But I’ll be anxious until it happens.” Contact: arielle.kass@crain.com; (313) 446-6774; @ArielleKassCDB

Advertising Section

CLASSIFIEDS To place your listing, contact Suzanne Janik at 313-446-0455

MARKET PLACE REQUEST FOR PROPOSALS The living room at 140 Edison St. The Fords lived in the Boston-Edison home until they moved to the Fair Lane estate in Dearborn. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

having its history recognized was an early priority for him. “Being a steward of such a property, it gave me a meaning and a focus in life,” he said. “I have never doubted for a moment it was an important thing to do.”

A house museum?

The plaque on the corner where the home sits says the seven years the Fords lived there “were the most creative of Mr. Ford’s career,” noting the mass production of the Model T and his moves on wages, “which revolutionized American life and industry and reverberated around the world.” But will buyers see the same history that Mitchell did? Listing agents Julie and Frank “ACQUIRING THIS HOUSE WAS A LIFEFlynn, with The Agency Hall & CHANGING EVENT, IN A POSITIVE WAY.” Hunter, said — Jerald Mitchell, homeowner they’ve reached out to Model T Since buying the house, he’s also led Ford clubs and others in the automothe preservation efforts at the Pi- tive world who might be as enticed by quette Avenue Plant, where the Mod- the history as they are the house itself. el T was first built. “The word is spreading,” Realtor Ju“Acquiring this house was a lie Flynn said of the parties that might life-changing event, in a positive be interested. way,” he said. “All of a sudden, I had a In an ideal world, Mitchell said he’d huge responsibility to a lot of people. like to see the home preserved as a ... There were a lot of sleepless nights, museum house. Though Associate a lot of what-ifs, always.” Broker Frank Flynn said it’s rare to see The home is listed by the Michigan a home of that era “unmolested,” it Historical Commission; Mitchell said seems unlikely.

Cynthia Sohn, the director of operations at Fair Lane, said they did not have plans to purchase any more property — and fund restrictions likely wouldn’t allow it. Mark Heppner, the president and CEO of the historic estate of Edsel and Eleanor Ford, said it didn’t have the same value as other historic properties. And Campbell, with the Henry Ford Heritage Association, said the money needed to make it into a museum would take away from fundraising efforts happening at other Ford sites. “Right now, it just doesn’t make any sense,” Campbell said. “For us to try to make that happen, it would just harm so many other places.” Additionally, he said, Boston-Edison neighbors likely wouldn’t want the traffic and tourism that came with having a museum down the street. Campbell said the Edison house is the second that the Fords owned; they first built what’s known as The Square House in Garden City upon getting married, then rented once they moved to Detroit until they built the property on Edison. Clara Ford designed the house, Campbell said, including a tiered backyard garden (the garden remains, though a pond has been covered) and a greenhouse. The property also includes garages with car washes; Edsel Ford, who was a teenager in the home, had a workshop over the garage in which he learned and tinkered. “This would be, like, my dream

Requests for Proposals are being accepted for:

Sector Partnership Training Services 2022 (SPTS 2022)

Responde date has been extended from June 13, 2022 to

Response Due: June 24, 2022 ** Extended **

Issued: May 16, 2022

The Mayor’s Workforce Development Board (MWDB) is directly responsible and accountable to the State of Michigan, Labor and Economic Opportunity-Workforce Development (LEO-WD) for the planning and oversight of talent development programs in the City of Detroit. Designated by the MWDB, Detroit Employment Solutions Corporation (DESC) serves as the fiscal and administrative entity that provides workforce services to job seekers and employers. DESC’s primary funding streams include Workforce Innovation and Opportunity Act (WIOA), Temporary Assistance to Needy Families (TANF) that funds Michigan’s PATH (Partnership. Accountability. Training. Hope.) employment program, Food Assistance Employment and Training (FAE&T), Wagner-Peyser Employment Services (ES), and other public and private funding. The Corporation enters into contracts with qualified entities to provide workforce development programs and services to job seekers and employers. American Rescue Plan Act (ARPA) and Center for Disease Control Foundation (CDC) funding may support contracts resulting from competitive bid process. DESC is seeking proposals from qualified individuals, organizations and/or firms.

Bid package for this RFP is available for download at this DESC website:

https://www.descmiworks.com/opportunities/rfps-and-rfqs/. Mayor’s Workforce Development Board Cynthia J. Pasky, Co-Chairperson David E. Meador, Co-Chairperson

Detroit Employment Solutions Corporation Board Calvin Sharp, Chairperson Detroit Employment Solutions Corporation Terri Weems, President

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JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 25 MAY 24, 2021 | CRAIN’S DETROIT BUSINESS | 17

SEWN

From Page 1

While ISAIC had been in the works for a few years, it officially launched April 2020 in a 12,000-square-foot Midtown Detroit space funded by Carhartt Inc. The organization continues to operate above Carhartt’s flagship store on Cass Avenue with a staff of 33. “Everyone in this industry here is really trying to challenge the existing model,” said Brenna Lane, co-owner of jean manufacturer Detroit Denim Co. Within the last few decades, a phenomenon called “fast fashion” has taken over the industry. Brands including Forever 21, H&M, Shein and ZARA produce new garments quickly and cheaply. Such practices include competing to reduce costs and improve bottom lines by compromising quality, paying the lowest wages and risking inadequate work conditions. “You have to really be considering a triple bottom line approach to truly be sustainable,” Lane said. The triple bottom line takes into account the financial cost, along with social and environmental costs. Over the last few years, the fashion industry has been singled out for its perpetuation of unethical labor standards and environmental consequences. Concurrently, Lane said that she has witnessed an increase in greenwashing, a form of deceptive marketing in which a company purports to be taking sustainable initiatives to attract customers and distance itself from its industry’s environmental concerns. “On the one hand, I think I get really frustrated by that,” Lane said. “… On the other hand, it lets me know that people are starting to demand that their brands be showing some sort of sustainability initiative.” “The curtain’s been pulled back on the industry, so it’s not going to be out of sight, out of mind anymore,” Guarino said.

Mat

train “W in-h that im’s

Detroit-Denim’s husband-and-wife founders, CEO Brenna Lane and founder Eric Yelsma. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Role of innovation Balancing a triple bottom line in apparel manufacturing must include innovations in technology, Guarino said. “So many chase the lowest unit price,” Guarino said. “If you don’t overproduce and chase that unit price, all those resources that you’re dumping, by choice, can go toward paying labor — domestic labor.” ISAIC’s equipment includes programmable sewing machines, laser cutters and multi-ply cutting machines. “Instead of having people earn low wages doing menial tasks, you deploy tech to do those, then you can actually afford to pay more at a higher-skilled contribution,” Guarino said. Over the next nine months, ISAIC is expected to see more advancements in technology, she said.

Founder Eric Yelsma stitches an apron at Detroit Denim Co. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

‘Unit of one’ Detroit Denim operates out of a 5,000-square-foot space on Detroit’s west side with a seven-person staff. The entire business runs on a made-to-order model, Lane 26 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

Detroit-based nonprofit organization Industrial Sewing and Innovation Center launched in April 2020. | ISAIC

said, to which the company pivoted in May 2021 in efforts to reduce waste. “We’re no longer speculatively manufacturing and saying ‘You know, I think this many in a size this are going to order jeans,’” Lane said. Since the new model’s launch, Lane said she has seen proof of concept that jeans can be made profitably without a large inventory. The product is also customizable to each customer’s size and style preferences. Other local companies in the industry are offering similar models. Dearborn-based Carhartt, which has a global workforce of more than 5,500 people, is testing a program that allows users to customize their workwear. For example, a left-handed construction worker could move the hammer loop on their pants to the left side. The program is in partnership with DXM, a technology platform that enables companies to custom fit, personalize or co-create products. “Making sure that there’s no waste, that you’re not overbuilding inventory, a lot of the focus has been about this idea of a unit of one,” said Alex Guerrero, senior vice president and general manager of global product at Carhartt. Founded in 1889, Carhartt operates and owns four manufacturing facilities in the U.S. and three in Mexico. Carhartt’s revenue was $1.35 billion last year, according to Crain’s Data Center. The family-owned company began as a workwear manufacturer for railroad engineers, the “astronauts of the day.” It now sources or

manufactures in nearly 20 countries. Of the 35 retail stores across the United States, two are in Michigan with its flagship store in Detroit. One of its largest U.S. customers is Tennessee-based farm and ranch supply store Tractor Supply Co. Detroit Sewn, a Pontiac-based cut-and-sew operation that also sells retail from its space, has also shifted to a made-to-order model for its brand to minimize waste. The company manufactures in its own facility and sometimes imports blank apparel — clothing without any decoration for brands to add designs — when orders cannot be fulfilled in-house. “This is us doing our part to prevent waste, which the apparel industry is so widely known for and such an abuser of, so we don’t keep big stockpiles of inventory,” Detroit Sewn President and CEO Karen Buscemi said. In addition to Detroit Sewn, Buscemi founded nonprofit Detroit Garment Group in 2012, which provides educational programs on the business of fashion, mentorships and connections to job opportunities in the industry. “Of all the fashion programs that we have in the state … none of them were teaching anything about the business of fashion. So they were all graduating them with the skills to be a fashion designer, but not to actually do anything with that other than go to work for somebody else,” Buscemi said.

Skilled workforce The lack of local skilled sewers has pivoted businesses to include

Mat Hunt opened Gettees with his father, Chris, in Sterling Heights. | GETTEES

training in their hiring process. “We really do have to train a lot in-house, and we’ve just worked that into our model,” Detroit Denim’s Lane said.

Offering competitive wages and a healthy work environment is also important to keep turnover low, she said. Since its launch in 2020, ISAIC

has graduated 25 students from its in-house Fundamentals of Industrial Sewing and Production course. While ISAIC’s focus is on apparel, Guarino said the organization’s programs and solutions are also applicable to manufacturing soft goods, or textile products like automotive interiors, bedding and carpet. Local cut-and-sew companies have hired some of the graduates, including Detroit Denim. Gettees, an apparel basics company operating out of a factory in Sterling Heights, was inspired by a college assignment. Mat Hunt was at Michigan State University working on a case study of the garment industry when he came across reports about the 2013 Dhaka garment factory collapse in Bangladesh, an event that spotlighted labor concerns in fashion. As a result of what he learned, Hunt said he strives to keep all aspects of Gettees local. Cotton is sourced from the U.S., and the design, cut and sew steps are done in its Sterling Heights factory with a production staff of about 15. “Some of our first sewers had a lot of experience in automotive sewing,” Hunt said. Overall, however, extensive training is built into the onboarding process at Gettees. “Part of the challenge is wherever you go in this country, we can’t find talent,” Guarino said. With continued efforts, Guarino said she envisions major fashion brands reshoring production to Detroit. According to data from the U.S.

Bureau of Labor Statistics, the can do,” Buscemi said. number of apparel manufacturing At Gettees, “The growth defiemployees in the Detroit-Warnitely leveled off a little bit beren-Dearborn area increased by cause of COVID, but we felt lucky 61.6 percent, from 716 workers in enough to keep people working, 2011 to 1,157 in 2021. BLS data also and sewing masks and gowns and showed an increase in the number helping out,” Hunt said. of private apparel manufacturing Online shopping also heavily inestablishments nationwide over “IF WE CAN BUILD A REALLY the course of 2021 — from GREAT TALENT FORCE HERE, 6,304 compaTHE INDUSTRY WILL COME nies in the first quarter to 6,526 HERE IN A HEARTBEAT.” in the fourth — Jennifer Guarino, president quarter. and CEO, ISAIC “If we can build a really great talent force creased during the pandemic and here, the industry will come here in gave brands an opportunity to a heartbeat,” Guarino said. continue sales and decelerate revenue declines. Hunt said that while Gettees has Pivoting during COVID a brick-and-mortar store in Eastern Market, about 80 percent of As storefronts shut down at the sales come from e-commerce. Last peak of the COVID-19 pandemic, year, Gettees’ online sales were up apparel manufacturers in metro 100 percent last year over the preDetroit found a way to contribute vious year, Hunt said, and it is pro— and keep their businesses jected to double again this year. afloat. Lane said she and her husband, ISAIC, Gettees, Detroit Denim, who founded the company, had to Detroit Sewn and others pivoted shut down Detroit Denim’s storefrom their usual production lines and committed their factories to front during the pandemic and onmaking personal protective equipline sales enabled them to stay afloat. However, they’re planning ment for hospitals, nonprofits and to reopen their brick-and-mortar community organizations. shop this fall. “It supplied PPE, but it kept “I think it’s (Detroit) a really some of those businesses open,” great place to challenge the indusGuarino said. try,” Lane said. Detroit Sewn fulfilled mask and isolation gown orders as large as Contact: minnah.arshad@crain.com; 75,000 units. “I think we learned a (313) 446-0416; @minnaharshad lot about what a little factory really

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RATES

From Page 3

Jim Taylor, co-founder and CEO of Electric Last Mile Solutions Inc., with an Urban Delivery electric van at the company’s Indiana facility last fall. Taylor and co-founder Jason Luo were forced to resign earlier this year. | BLOOMBERG

Electric Last Mile files for bankruptcy, owes more than $50M in liabilities BY KURT NAGL

Electric Last Mile Solutions Inc. filed a voluntary petition for Chapter 7 bankruptcy last week, disclosing that it has more than $50 million in liabilities to dozens of creditors in metro Detroit and beyond. The EV delivery van startup’s bankruptcy petition, filed Tuesday in U.S. Bankruptcy Court for the District of Delaware, is the first step of a liquidation process the Troy-based company announced June 12. Once a rising EV star with a $1.4 billion valuation, Electric Last Mile was unable to recover from an abrupt loss of leadership and regulatory troubles on top of a lack of financing and manufacturing capabilities. Tuesday’s filing makes it the first of the electric-vehicle startups that merged with special purpose acquisition companies to go out of business amid the recent market slump. The company’s estimated assets range from $50 million to $100 million, as do its estimated liabilities, according to the court filing. Chapter 7 bankruptcies allow

companies to develop a plan to liquidate assets and repay creditors. Electric Last Mile has 100-199 creditors, ranging from large Michigan-based automotive suppliers Continental Automotive Systems Inc. and Autoliv Inc. to logistics, software and financial services businesses and a host of law firms including Butzel Long PC, Foley & Lardner LLP and Clark Hill PLC. Also listed as creditors are Suburban Ford of Waterford Township and Tesla, at 2800 W. Big Beaver Road, where the EV giant has a showroom inside the Somerset Collection in Troy. Corporations that own more than 10 percent of the startup include AJ Capital Investment and Luo Pan Investment II, both Bloomfield Hillsbased firms registered to Jason Luo — co-founder and former chairman of ELMS. Luo and James Taylor, former president and CEO, were forced out of the company after an investigation found they improperly purchased equity in Electric Last Mile before it went public though a SPAC merger a year ago. ELMS is being represented by Kara

Coyle, partner at Delaware-based Young Conaway Stargatt & Taylor LLP. Coyle offered no comment to Crain’s and directed questions to the company. Electric Last Mile could not be reached through a spokesman. The status of the company’s employees in Troy remains unclear. ELMS also occupied a manufacturing plant in Mishawaka, Ind. It announced in March it was laying off 50 employees, or about a quarter of its staff. Other companies based in Michigan listed as creditors of Electric Last Mile include: ` Altair Engineering ` Blue Care Network Of Michigan ` FEV North America Inc ` Humanetics ` Mahindra Integrated Business Solutions ` MicroCenter ` Penske ` ThyssenKrupp Elevator Corp. ` United Road Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

Those factors now have the 30year fixed mortgage rate pushing toward 7 percent, the highest rate in nearly 25 years, according to data from Freddie Mac. “And so there’s no question we’re in a very rapidly rising mortgage rate environment, and that’s not likely to change anytime soon because of the fundamentals we just talked about,” Cecala told Crain’s ahead of the rate hike announcement. “So that’s kind of the backdrop, and for mortgage lenders there’s not a lot of good news on it.” The rising rates over the last several months means that a $300,000 mortgage taken in December would result in a $1,265 monthly payment at the time, and would now be up to $1,800, according to figures from the National Association of Realtors. “That’s painful and, consequently, will shrink the buyer pool,” NAR Chief Economist Lawrence Yun said, adding that home sales and rental rates will likely suffer for some time. “Only when consumer price inflation tops out and starts to fall will mortgage rates stabilize or even decline a bit. That is why providing additional oil supplies will be critical in containing consumer prices and interest rates.” Metro Detroit has emerged as a hub for mortgage lending over the last two decades or more, spurred on by the growth of Detroit-based Rocket Mortgage, formerly known as Quicken Loans. It’s the largest mortgage lender in the country and Detroit’s largest employer. Pontiac-based United Wholesale Mortgage has also grown rapidly before and during the COVID-19 pandemic years. The two companies collectively employ around 25,000 people in the region, although Rocket Mortgage has offered buyouts to certain employees, something UWM CEO Mat Ishbia has sworn against. Executives at Rocket and UWM were not available for interviews last week ahead of the Fed rate hike announcement. The rising rate environment does present challenges, but executives say their respective companies will still find a sustainable path forward. “We’re kind of in the third inning of this process,” Jay Farner, vice chairman and CEO of Rocket Mortgage parent company Rocket Cos.,

told analysts last month, noting that the company’s mortgage lending business has been in existence for more than three decades. “And it’s one Ishbia that we’ve lived through before, certainly back in 2008, 2009, 2010, and we saw little glimpses of this in 2014 and 2019,” Farner said. “You’ve got to have a long-term view while you’re taking short-term actions to ensure that the company is set up for success.” UWM’s Ishbia told analysts last month that the company’s proprietary technology enables it to continue forward without cuts to its workforce of roughly 8,000 and churn out profit. “The question you’re asking is how can we do it and others don’t,” Ishbia said. “It’s because of technology. Technology and efficiencies. We’re gonna be extremely profitable, like I said last quarter, as long as we continue to run our business the way we run it, (focused on) the purchase market.” To Ishbia’s point, the companies have remained profitable so far and that’s largely expected to remain the case, although likely diminished from the pandemic years when low interest rates fueled a refinancing boom and homeowners sought new and larger houses. Still, Cecala with Inside Mortgage Finance said he’s skeptical that the much-touted technology offered by mortgage companies will do much to stave off the need for further job cuts in the sector. And the changes to the mortgage sector are unlikely to stop at just job cuts. Asked by Crain’s whether the industry seems ripe for mergers and acquisitions, Cecala offered a simple assessment: “Definitely.” While it’s unclear which companies are likely to be the acquirers and which will be acquired, the current market dynamics all but demand consolidation, according to Cecala. “Historically, you’ve seen it and it’s perfect to do if a lender has a good footprint but they see no upside going forward,” he said. “It’s a ripe opportunity for someone to start making acquisitions,.” Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

Fluctuating mortgage rates

ELMS

From Page 1

The SPAC merger — or combining with a “blank check” company — has been a popular vehicle for going public and raising capital quickly, as Lucid Group Inc., Canoo Inc., Nikola Corp. and Lordstown Motors Corp. all did. Eventually, though, a company must start making revenue and proving it can be a viable business, said Ted Serbinksi, managing partner and founder of Detroit-based startup venture fund Stanson Ventures. “The window is contracting, with investors saying, ‘Let’s go back to more business sense, like do you make money?’” Serbinski said. “And if you’re not making money, you’re getting crushed in the market.” Electric Last Mile’s administrative base is in Troy, while its production plant is a former Hummer H2 factory 28 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

in Mishawaka, Ind. “We’re re-energizing an assembly line — and a community — by manufacturing up to 100,000 vehicles every year,” the company’s website said. Despite ambitious plans and backorders for thousands of units, the company failed to bring its van to market. The company did not return questions Monday about how many employees it has or its plans for layoffs. It announced in March it was laying off 50 employees, or about a quarter of its staff. The beginning of the end for the startup happened earlier this year after the abrupt resignations of its top executives and founders, President and CEO James Taylor and Chairman Jason Luo. Since then, the company has reported through SEC disclosures a series of damaging blows, including the resignation of its public accounting firm, delays in financial reporting and the announcement in

May that it would run out of cash without more investment. “I think investors have already cooled their heels on auto tech,” Wybo said. “The SPAC market has really cooled off. Any new money thrown at this new technology is going to be, ‘OK, prove it. Prove that you can do it.’” As such, Wybo said he predicts there will not be anymore EV startups cropping up anytime soon. “I think investors will be very skittish and probably not attracted to anything new in this space,” he said, adding that Electric Last Mile will not be the last EV startup to go under. After a period of free-flowing capital, consolidation is the next step in the cycle, Serbinski said. “The Ubers of the world, they take a good 10 years to mature if they’re going to be a big business,” he said. Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

Costs for mortgage loans have fallen and risen significantly over the last five years, with the increases coming during periods of higher inflation. Weekly rates, June 15, 2017, to June 16 U.S. 30-year FRM

U.S. 15-year FRM

U.S. 5/1-ARM

6.0%

5.78%

5.0

4.81% 4.33%

4.0

3.0

2.0

2017

SOURCE: FREDDIE MAC

2018

2019

2020

2021

2022

MARIJUANA

From Page 1

The marijuana grower received the first recreational license in the city of Detroit last month and is preparing to expand its operations to meet the demand of a city that’s been starved of legal recreational weed for more than two years as city council debated regulations. “We see it as a phenomenal opportunity for us to satisfy our need for quality team members and simultaneously provide an opportunity for someone on the spectrum,” said Eric Slutzky, CEO of Doghouse Farms Michigan. Opportunity is critical because unemployment is rampant among the autism population. Roughly 50 percent to 75 percent of the 5.6 million autistic adults in the U.S. are unemployed or underemployed. Nearly half of all 25-year-olds on the spectrum have never worked, which is a larger percentage than 25-year-olds categorized with learning disabilities, intellectual disabilities and speech impairment. And those on the spectrum with a job tend to earn well below the poverty line. Of the roughly 18,000 adults on the spectrum who used state-funded vocational programs in 2014, fewer than 11,000 left those programs with a job and 80 percent of those worked part time with a median weekly wage of only $160, according to the largest autism research and advocacy organization Autism Speaks. Doghouse pay starts at $16.50 an hour plus benefits, Slutzky said.

Doghouse Farms CEO Eric Slutzky inside of a flower room for cannabis plants at his company’s grow operation in Detroit | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

jobs. “We’re only at the beginning, but the marijuana industry provides an interesting potential for our candidates,” Colleen Allen, CEO of the Autism Alliance told Crain’s. “The plants, horticulture, for whatever reason seems a significant interest for those on the spectrum. We definitely see it as a potential employer for some of our candidates.” Allen visited Doghouse last month and another dispensary in Lake “IF THIS WORKS OUT FOR US, THE Orion at the invite of Jeff YaOPPORTUNITY IS BOUNDLESS.” tooma, a real es— Eric Slutzky, CEO, Doghouse Farms Michigan tate broker and growing player in The idea to place adults on the Michigan’s marijuana industry. spectrum in marijuana facilities Autism Alliance is moving to conemerged from a conversation be- duct a job analysis at Doghouse in tween Slutzky and friend Marc Berke, hopes of identifying a potential fit for chief development officer at Autism job candidates in its system. The Alliance of Michigan. grower is looking to fill jobs trimming The nonprofit launched a “moon- buds from harvested plants and shot” effort in 2020 to place 100,000 packaging the product, which inMichigan adults on the spectrum in volves using precision scales and at-

THEATERS

From Page 3

While attendance was down 40 percent in the fist quarter of 2022 compared to the same time frame in 2019, blockbuster hits like “Top Gun: Maverick,” which debuted over Memorial Day weekend with $124 million earned, show there’s still interest in going to the movies. In an effort to get people back into seats, metro Detroit theaters have launched a variety of promotions and upgrades, particularly with the seats themselves. MJR’s seat updates intend to “ensure they remain at the forefront of the theatrical experience guests come to expect.” On June 9, the Michigan Science Center reopened its IMAX Dome Theatre after being closed for over a year. The center introduced “239 brand-new, custom-designed seats featuring FreeForm Trim technology” designed and donated by auto supplier Magna, the center said in a release. “We are grateful to Magna for providing state-of-the-art seating for our IMAX Dome Theatre, which will allow our guests to relax in comfort while viewing inspirational and

The IMax Theatre reopened with 239 brand-new, custom-designed seats featuring FreeForm Trim technology designed and donated by Magna. | MICHIGAN SCIENCE CENTER

thought-provoking shows,” Dr. Christian Greer, president and CEO of the Michigan Science Center, said in the release. “A large screen with 360-degree views provides an unforgettable experience for our guests and helps us achieve our mission of putting you

tention to detail. The nonprofit has 1,800 adults on the spectrum in its database who are seeking employment. Nearly 500 of those in the pool are job-ready, said Kelly Blakeslee, employment manager for the Autism Alliance. Since launching a workforce program in 2015, Autism Alliance has placed 450 adults on the spectrum in jobs around the state, including Ford Motor Co., Waste Management and others. Blakeslee has identified three to five candidates out of its pool that she believes are most likely to be a fit for Doghouse. However, there are concerns. Doghouse Farms operates in a run-down industrial area on Detroit’s East Side and public transportation options are concerning, Blakeslee said. Other issues are the work environment: Marijuana grow operations smell. In fact, the scent of marijuana clings to your clothes for hours, if not days after leaving. The operations also use bright grow lights at the center of science.” Some theaters have had to rely on financial help to stay afloat. In September, Phoenix Theaters opened its fourth Michigan location with help from several funds and grants offered to keep businesses afloat during the pandemic. It has received $10 million in Shuttered Venue Operator Grant funds, a $3 million loan from the Federal Reserve’s Main Street Lending Program, which helped Phoenix meet operating costs, and $580,162 in Payroll Protection Program loans to preserve 158 jobs at five theaters, according to company founder Cory Jacobson. Emagine Entertainment has also implemented new tactics to draw moviegoers back to the theaters, such as hosting special viewing nights in its Royal Oak Sports Lounge dedicated to sports events and a National Ghostbusters Day double feature, with guest appearances from Ghostbusters Detroit crew members. Emagine Entertainment also displayed other special engagements at their theaters, like Ghibli Fest, the Twenty One Pilots Cinema Experience, early access events and more. Contact: anna.fifelski@crain.com (313) 446-0458; @annafifelski

and workers often listen to music to put a beat to the often monotonous work. “Those could be an issue for those who are neurodiverse,” Blakeslee said. But the inclusiveness of the industry and the job’s repetitiveness and attention to detail are worth those risks, Allen said. Slutzky agrees. “It’s a young social group that takes their work very seriously and works hard but they also get along together as a family,” Slutzky said. “Autism can be very lonely and I think there is an excellent socialization aspect to this work.” But another issue is funding. Medicaid covers job placement services, like those provided by Autism Alliance, but because marijuana remains an illegal drug under federal law, the Centers for Medicare and Medicaid would not fund the job coaching and other wraparound services, Allen said. However, she said, the nonprofit can fundraise to cover these services if they push forward

with jobs in the field. And the industry has integrated with autism for more than a decade. Researchers, doctors and parents have experimented with marijuana to alleviate some autism-related conditions. In fact, despite being federally illegal, the Food and Drug Administration has approved one cannabis-derived drug called Epidolex to decrease seizures commonly found in people on the autism spectrum, and many other treatments are in early-stage clinical trials. While largely unstudied due to its illegality at the federal level, some early studies show promise in marijuana use for those on the autism spectrum. A study in 2018 found a 20-to-1 dose of cannabidiol (CBD) to tetrahydrocannabinol (THC) relieved aggressive outbursts in children on the spectrum. THC is the psychoactive compound found in marijuana that gets users high, whereas CBD is a chemical compound that is believed to reduce pain and inflammation among other symptom relief. A similar ratio compound of marijuana also reduced seizures, tics and depression among teenagers on the spectrum, according to a 2019 study. “We have some candidates that use it for medicinal purposes and others, for religious or family reasons, are completely against it,” Blakeslee said. “It’s divided in our community like the rest of the public, but there is still potential there. We don’t have anyone in our database currently working in the industry, but I think some could be quite successful there.” And with Michigan’s marijuana industry expected to nearly triple in the next five years, labor force is one of its main concerns, Slutzky said. “If this works out for us, the opportunity is boundless,” he said. “There are operations coming online all across the state and the country and labor force is one of the bigger issues we face. If we can provide a safe environment for people on the spectrum to get into this field, well, it’s a massive win for all of us.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

MERGERS & ACQUISITIONS

Huntington Bank completes deal to buy Capstone Partners BY NICK MANES

Huntington Bank has completed the acquisition aimed at broadening its reach into middle-market business consulting. The Columbus, Ohio- and Detroit-based Huntington Bancshares Inc. (Nasdaq: HBAN) said Thursday that it closed the deal, announced in March, to acquire Capstone Partners, an investment banking and advisory firm with its primary offices in Boston and Denver, as well as offices in 12 other cities. Terms of the deal were not disclosed. The acquisition expands Huntington into four major areas of expertise, according to a news release: M&A, capital advisory, financial advisory and “special situations” such as restructuring. “The combined industry expertise of Huntington and Capstone, along with our ability to serve our growing core middle market client

base across the United States, enables us to expand our role as a trusted advisor to a wide variety of businesses,” Scott Kleinman, senior executive vice president and co-president of Huntington’s commercial bank, said in the release. “Our industry insights and full range of capabilities position us to provide a consistent, differentiated experience for our clients, who will benefit from an aligned culture that puts customers and communities at the center of everything we do.” For Huntington, a top 20 U.S. bank with about $176 billion in assets, the deal offers an expanded geographic footprint, more solutions on offer for business-owner clients and other synergies. Keefe, Bruyette & Woods served as the financial adviser for Capstone, which last year acquired the restructuring business of Birmingham-based Amherst Consulting LLC. JUNE 20, 2022 | CRAIN’S DETROIT BUSINESS | 29

THE CONVERSATION

Tony Saunders sees big things ahead for Fathead, Volte Fathead owner Tony Saunders is a busy man. The 36-year-old acquired the Detroit-based vinyl sticker company in 2020, three years after establishing Volte — an umbrella entity formed to partner with organizations and provide financial and operational advisory services, equity and management services. Volte earlier this year added Royal Oak-based Big Moods stickers to its list of properties, which also includes Detroit-based football equipment manufacturer Xenith. Saunders, a Detroit resident and father of two, took an interesting road to entrepreneurship. He previously served as CEO of Rock Ventures, where his relationship with company founder Dan Gilbert, along with his business acumen and leadership abilities, led to Saunders’ purchase of Fathead. Saunders from 2015-17 worked as chief restructuring officer and chief financial officer for Wayne County, leading a push to eliminate the county’s structural and accumulated deficit, which got as high as $100 million in 2015. The University of Michigan graduate also held roles with the state of Michigan, state Treasury Department and Detroit City Council. Saunders, who admits he doesn’t do much (read: any) media, talked with Crain’s about his winding career road and what’s next. | BY JAY DAVIS `How are things going with Volte? For us, this has probably been the most exciting period since we acquired (Fathead). We acquired the business in early March 2020. A week later, the NCAA basketball tournament was canceled because of (the coronavirus pandemic). Fathead’s business, as you probably know, relies heavily on sports and entertainment, so that was a tough time. Our team rallied. We organized the business in a way that protected our people and the brand.

Tony Saunders is the owner of Fathead and Volte.

`I’m curious. How did you manage things during COVID with leagues shutting down, bars that would have Fatheads displayed being closed, especially with that coming so soon after you purchased the company? We had to figure out how to survive. Our suppliers in Michigan the state shut down, so we had to go to a contingency plan. We had to do a bunch of things that we didn’t expect when we signed up. I can’t tell you that if COVID hit before the purchase was finalized, that I would’ve wanted to buy the business. If I knew then what I know now, I can’t say I would’ve made the same decision. Sometimes things happen for a reason. That situation allowed us to get really intimate. `Did you do any layoffs during the early stages of COVID? We did, but it wasn’t because of the pandemic. We were restructuring the business. Sales were slow because of COVID. We did our best to treat people fairly and ensure a smooth transition. You’ve got to protect your brand and the longevity of your business. I feel good about where we are because we have people on our team who execute. When they don’t, they figure things out anyway

and make the best of what they have. Nobody here plays the blame game. `You did a lot of good work for Wayne County and in your other roles. How did it happen you made a move to the private sector from the public sector? The work I was doing in government was restructuring. I learned a lot. I was put into a lot of positions because of talent deficiencies that existed. I’m not naive enough to think I was always the

best person for the job. Restructuring is hard. When you’re doing it, you’re the bad guy, but you understand why. You’re generally trying to do the right things for the right reasons, but it weighs on you a bit. My dad was a city employee who retired while the city was going through bankruptcy. He had his health care eliminated, and it raised some concerns for our family. It’s never a fun thing to have to do something like that. I learned so much working in government. I think

every young person fresh out of school should work in government for a time. A lack of resources in urban communities shows that we need better brain power. You can take those opportunities and turn them into a personal mission. As an act of public service, I enjoyed that part. I have two young kids. To be candid, I wanted to create a life for them that I didn’t have for myself. The other thing is I wanted to see if I could build something. Sometimes you want to see what you’re made of. Working with (Dan Gilbert) was one of the best paid internships anyone could have. It wasn’t an internship, but that’s how I approached it. He put me in some rooms, some positions to do some things. I felt led to something that’s bigger. Our purpose is to do what we do to the best of our ability. Dan and Rock decided they would sell Fathead. I was a part of that process. Some deals didn’t go through. I was in a transitional point in my life. I told a guy who works in Dan’s family office I’d buy it. That’s how it happened. `You walk in someone’s home and see a Fathead. What do you think? That’s a damn good question. It’s a cool moment. It’s kind of like art or real estate. Even though I’m not the one who created the brand, it’s in my family now. The people I work with, it’s a part of their lives. We’re building this. We’re all trying to win and get to a certain level. That question makes me think about irony. It takes a lot for people to give each other opportunity. So many people have given me opportunities: (Wayne County Executive) Warren Evans, (former Detroit City Council President) Saunteel Jenkins, Dan Gilbert. That’s what I’m trying to do intuitively, not with some social rationale behind it. My job is chief recruiter in essence. If I can find people to help us, it’s good for all of us.

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Tudor Dixon nabs primary endorsement from Michigan Chamber LANSING — THE MICHIGAN CHAMBER of Commerce, one of the state’s most powerful business groups, is endorsing Tudor Dixon in the Republican gubernatorial primary. The announcement Thursday was the latest campaign boost for Dixon, who recently secured backing from the DeVos family and Right to Life of Michigan. “Tudor Dixon is a strong, principled leader who has demonstrated a commitment to free enterprise, our state’s shared economic prosperity and a predictable regulatory climate,” Jim Holcomb, the organization’s president and CEO, said in a statement. The group said it will wait until after the August primary to make 30 | CRAIN’S DETROIT BUSINESS | JUNE 20, 2022

Businesswoman Tudor Dixon of Norton Shores answers a question during the Gubernatorial debate in the big tent on the lawn of the Grand Hotel at the Mackinac Policy Conference in June. | DALE G YOUNG FOR CRAIN’S DETROIT BUSINESS

an endorsement in the November general election. Dixon, of Norton Shores, formerly helped to host “America’s Voice Live” — a conservative news show — and worked in sales in the steel industry. The other four GOP candidates on the ballot are Allendale real estate broker Ryan Kelley, Oakland County pastor Ralph Rebandt, Bloomfield Hills businessman Kevin Rinke and Mattawan chiropractor Garrett Soldano. Former Detroit Police Chief James Craig is mounting a longshot write-in campaign. The primary winner will face Democratic Gov. Gretchen Whitmer in November.

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