Crain's Detroit Business Aug. 2, 2021, issue by Crain's Detroit Business

THE CONVERSATION: Shyft’s Daryl Adams on navigating new challenges. PAGE 26

GEN Z BUYERS New generation enters a hot housing market PAGE 3

CRAINSDETROIT.COM I AUGUST 2, 2021

GREAT LAKES POLLUTION

SWIMMING IN PLASTIC STEPHEN J. SERIO

Great lakes microplastics pollution showing up in fish, birds — and your beer glass. PAGE 13

FIND THE COMPLETE SERIES ONLINE CrainsDetroit.com/Crains-Forum

Nonprofit CEO salaries at a premium amid turnover vices, affordable housing development and economic development, among other programs. had come from and the After nearly three challenges we were conyears of turnaround effronted with financially, we forts under interim had to have someone who management, Southhad the expertise right up west Solutions broke front,” said Southwest’s even last year, reversing chair, Stephanie Miller, re- De Four a $3.9 million loss in tired COO of Dearborn non2017. profit Vista Maria. Southwest did not look at the age “We did not have margin for of the candidates and their time in someone to learn on the job.” In the new role, de Four is over- the field as a qualifier for what it seeing one of the region’s largest should pay them, Miller said. It and most complex nonprofits that looked at their skill set and the exgrew to include mental health ser- pertise they brought.

Luring a new top executive can require organizations to dig deep BY SHERRI WELCH

Southwest Solutions’ new CEO Sean de Four is about 30 years younger than longtime CEO John Van Camp, who led the organization for 37 years before retiring in 2018. But when de Four joined the Detroit-based nonprofit in March, he commanded about the same level of pay as Van Camp, with base pay just shy of $250,000. Nonprofit CEOs are commanding higher salaries in what execu-

TOP-PAID NONPROFIT CEOS Pages 8-11 tive search consultants say is a tighter market given a less robust pipeline of leaders, the push for diverse candidates and increasing competition with the for-profit sector for talent, which is leading to more national searches. Long term, those trends will push the CEO salaries at even the smallest human services agencies up. “We knew given where Southwest

NEWSPAPER

SUPPLY CHANGE It’s getting harder to get goods from Point A to B — and it’s costing more, too. PAGE 3

“We were just lucky that (de Four) was available to be considered. He came with everything we needed.” “No one on the board quibbled about the pay.” On average, the market rate for nonprofit CEOs has increased 15-25 percent during the pandemic, executive search consultants said. “It’s basic economics: Demand is higher; supply is lower. That’s driving up compensation,” said Blaire Miller, managing partner/owner of the Hunter Group, a national executive search firm based in Bloomfield Hills. See SALARIES on Page 8

NEED TO KNOW

ALL-STAR DEAL

BLOOMBERG

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

` FORMER SEN. CARL LEVIN DEAD AT AGE 87 THE NEWS: Former U.S. Sen. Carl Levin, a giant in Michigan politics from a prominent political family who served in the U.S. Senate for 36 years, died Thursday at age 87. No cause of death was given. Earlier this year Levin revealed he had been living with a lung cancer diagnosis since age 83. WHY IT MATTERS: Among many other accomplishments, Levin will be remembered among businesses for his dogged scrutiny of tax shelters, support for manufacturing and military jobs in his home state and securing federal funding for revitalizing Detroit's riverfront. "His legacy will live on forever in the hearts of Detroiters," Detroit Mayor Mike Duggan said in a statement.

` STATE'S HIGH COURT ALLOWS CHARTER ISSUE ON BALLOT THE NEWS: The Michigan Supreme Court has ruled revisions to Detroit's

governing document can appear on Tuesday's primary ballot. In its Thursday opinion, the court reversed the Wayne County Circuit Court and Court of Appeals decisions that originally took the proposed revisions off of the ballot. The Charter Revision Commission in charge of creating Proposal P appealed to the Supreme Court after the lower courts sided against it. WHY IT MATTERS: Backers say the revisions would increase equity in the city; opponents including Mayor Mike Duggan have warned of financial havoc if the changes are approved.

` WATER AUTHORITY CHIEF RESIGNS AMID FLOOD FUROR THE NEWS: The head of the Great Lakes Water Authority resigned weeks after thousands of homes were damaged by sewage backups during a tremendous storm. CEO Sue McCormick didn't cite the June 25-26 flooding as the reason for her departure, though the controversy clearly has tarnished the Southeast Michigan water agency. She said she had been contemplating retirement. WHY IT MATTERS: The response to the massive flooding has been dogged by questions about employees' response to a power outage three days before the heavy rains that wasn't reported to higher-ups at the agency.

` NORTHLAND CENTER PROJECT GETS STATE INCENTIVE THE NEWS: A proposal to turn the Northland Center property into a sprawling multifamily development with thousands of apartments and other forms of housing and commercial space has received state approval for $26 million in brownfield financing. The Michigan Strategic Fund approved the state tax increment financing capture for the Southfield project Tuesday morning, providing another key approval for what ultimately is envisioned as a development by Bloomfield Hills-based Contour Companies LLC. WHY IT MATTERS: The project, which as envisioned would be one of the largest apartment developments in Michigan, would bring new life to former site of the pioneering shopping mall.

` PISTONS TAKE CUNNINGHAM WITH RARE TOP DRAFT PICK THE NEWS: The Detroit Pistons selected Oklahoma State's Cade Cunningham with the No. 1 pick in the NBA draft.

Local company ogre the moon for ‘Shrek’ music rights ` Twenty years after the animated film “Shrek” charmed theater audiences, North Star Media, a Bloomfield Hills-based music licensing and publishing company, has acquired the royalty rights to all of the original music from the film franchise. The family-owned company bought the original composition royalty rights in a $2.2 million cash deal at an auction from Royalty Exchange on July 20, North Star President and CEO Jordan Dorfman told Crain's. North Star won out over 45 other bidders. It's the company's largest deal to date, proving only shooting stars break the mold. The life rights to royalties include 643 original compositions written by Harry Gregson-Williams from all four “Shrek” films — “Shrek,” “Shrek 2,” “Shrek the Third” and “Shrek Forever After.” It also earns money from the holiday TV special “Shrek The Halls” and any time this music is used in other TV, film or commercial programming. Royalties grew 33 percent year-over-year, according to the asset's Royalty Exchange listing, because “Shrek” films aired more often on TV and streaming services in 2020. “Shrek” films generate continuing music royalties. | CONTRIBUTED PHOTO

WHY IT MATTERS: The 19-year-old is a 6-foot-8, 220-pound point guard known for his size and fluidity on the court and represents a major building block of the Pistons' youth movement. It was the team’s first time picking first in the draft since taking Bob Lanier with the top pick in 1970.

2 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

THE HOME STRETCH

Costs, delays plague shipping Transport firms face high demand BY KURT NAGL

Andrew Piontkowski and Allison Moll found a home they love on Norwood Street in Grosse Pointe Woods, but it took a lot of patience. | CONTRIBUTED PHOTO

Millennial, Gen Z buyers struggle to win in challenging market BY KAREN DYBIS | SPECIAL TO CRAIN’S DETROIT BUSINESS

Overwhelming deadlines, falling-down structures with over-price offers, pressure to spend money they don’t have: Metro Detroit’s millennial and Gen Z homebuyers came into a residential real estate market like no other yet say the pursuit of a single-family home to call their own kept them going despite the challenges. Realtors who work with these home-buying newbies say the main part of their jobs over the past 16 months of an intensely competitive market has been education about the process. While mil-

lennials and Gen Z were ready to buy — in fact, surveys show many had bigger down payments because of the pandemic — encouraging endurance and staying true to a budget was the more prudent track, real estate agents and brokers say. “I tell them to be patient — don’t be discouraged if you can’t find anything you like when you first start looking,” said Kyle Lang, an agent with RE/ MAX Dream Properties. “Houses are like buses. There’s always another one coming.” According to Zillow, millennials are the largest generational group of homebuyers and, as a result, See HOMES on Page 25

“I TELL THEM TO BE PATIENT — DON’T BE DISCOURAGED IF YOU CAN’T FIND ANYTHING YOU LIKE WHEN YOU FIRST START LOOKING. HOUSES ARE LIKE BUSES. THERE’S ALWAYS ANOTHER ONE COMING.” — Kyle Lang, agent, RE/MAX Dream Properties

Have some patience for that neighbor with the unkempt grass this summer — it could be the supply chain disruptions of the past year just won’t get off their lawn. Supply chain woes, from lawn and garden equipment to the global computer chip shortage afflicting the auto industry, continue to drag down many metro Detroit businesses otherwise in boom mode from record demand. Hessell Such is the conundrum for New Baltimore-based BW Retail Solutions. Since forming as a joint venture between Weingartz Supply Co. and Ball Equipment in 2017, the company has grown into one of the nation’s largest direct-to-consumer retailers of replacement parts for lawn equipment and power sports. Sales have spiked — revenue is expected to grow by nearly 50 percent year-over-year to $100 million in 2021 — and the e-retailer cannot acquire warehouse space and employees fast enough, said Eric Hessell, vice president of operations. But the fractured supply chain is holding it back. “The container costs are up, labor costs are up, packaging and supplies costs are up — all between 15 and 20 percent — and the costs in the end are reflected in the prices you see on Amazon and eBay,” Hessell said on a recent walk between buildings at BW’s warehouse and fulfillment campus, which has more than quadrupled in size from its 40,000-squarefoot start four years ago. See SUPPLY on Page 24

Vaccine mandates gain momentum Health systems add requirements; will other employers follow? BY DUSTIN WALSH

COVID-19 vaccine mandates are picking up momentum across the state. Beaumont, Spectrum, Ascension and Michigan Medicine health systems all mandated the vaccine for employees and contractors last week. Their roughly 172,000 collective employees in Michigan must comply by varying dates in late August through the late fall, depending on their employer, if they haven’t done so yet.

They followed Livonia-based Trinity Health and Detroit-based Henry Ford Health System, which previously had put mandates in place. Other major health systems are expected to follow suit in coming days and weeks. The mandates come as the dangerously contagious delta variant of the coronavirus continues to spread throughout the U.S. COVID-19 outbreaks were up 21 percent in Michigan between July 22-28 as national cases have jumped 440 percent

since June. But while private sector vaccine mandates remain an open question, experts predict those that will implement them remain low as companies battle the ongoing labor shortage and sharp anti-vaccine rhetoric among some staff, leaving fear that odds are favorable for the pandemic to become an endemic. Beaumont and Spectrum — the two health systems are in the process of merging by late September— See VACCINE on Page 25

Oakland County Health Department RN Kate Barlow prepares a Pfizer COVID-19 vaccination at the Karl Richter Community Center in Holly. | NIC ANTAYA/SPECIAL TO CRAIN’S DETROIT BUSINESS

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 3

REAL ESTATE INSIDER

Close or move? Vault of Midnight owners said go bigger, not home

In the end, Curtis Sullivan says he just didn't have enough space. So the iconic comic book shop, Vault of Midnight, that he coowns is packing Kirk up its inventory PINHO in downtown Detroit and moving into the city's Milwaukee Junction neighborhood in a building on East Grand Boulevard owned by Method Development LLC. With a five-year lease in about 1,400 square feet expiring in a Dan Gilbert-owned property on Library Street, Vault of Midnight is opening this fall in space about twice that size in the Albert Kahn-designed building at 2857 E. Grand Blvd. "It was either close it down because we weren't gonna re-sign, or find a much bigger space," Sullivan said. Typical sales numbers at the store, located at 1226 Library St., were between $750,000 and $1 million per year. But doubling the space — and the inventory — will allow the store to double its revenue to a projected $1.5 million to $2 million, said Sulli-

van, who co-owns the store with Stephan Fodale. It was Vincent Mazzola, senior associate at Detroit-based O'Connor Real Estate, who put Vault of Midnight in touch with Method Development, run by Rakesh "Rocky" Lala and Amelia Patt Zamir, according to Sullivan. "We drove around the city and looked at 30 spots, and as soon as we saw this building early on, we kept coming back to it and back to it, re-

VAULT OF MIDNIGHT, WHICH OPENED ITS FLAGSHIP DOWNTOWN ANN ARBOR LOCATION 25 YEARS AGO IN 1996, ALSO HAS A THIRD IN GRAND RAPIDS. searching the neighborhood, and we couldn't be happier to be in this spot," Sullivan said. In addition to the interior buildout, the east side of the new building is being adorned with a mural starting this week by Sintex and Nic Notion, a pair of well-known muralists and graffiti artists from Detroit, said Maia (Crown) Williams, founder of

Amonyet Enterprises and MECCAcon (Midwest Ethnic Convention for Comics and Arts), who is project manager for the mural. "It's going to be centered on Detroit comics, especially representation of comics, people that are from Detroit or characters that are from Detroit, so it's going to include a lot of different things," she said. The mural is going to include the late Dwayne McDuffie, a Detroit-born comic book writer who founded Milestone Media, which produced comics with ethnically diverse casts that were distributed by DC Comics, according to a 2011 New York Times obituary. "He's a huge, huge legend," Williams said. Icon, one of the Milestone characters, will be included in the mural, as will Kamala Khan, a Marvel Comics character. The mural is expected to start on Wednesday and take about two weeks to complete, Williams said. Vault of Midnight, which opened its flagship downtown Ann Arbor location 25 years ago in 1996, also has a third in Grand Rapids. It won the Will Eisner "Spirit of Comics" Award at the San Diego Comic-Con in 2010. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

Vault of Midnight’s new location in Detroit’s Milwaukee Junction neighborhood on East Grand Boulevard. It is expected to open in the fall. | KIRK PINHO/CRAIN’S DETROIT BUSINESS

Vault of Midnight’s lease is expiring on its about 1,400-square-foot store in a Dan Gilbert-owned property on Library Street.| KIRK PINHO/CRAIN’S DETROIT BUSINESS

Just like you, we’re here for your employees.

4 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021 BCB144280_MSG_Print_Crains_DB_8-2-21_Insertion_F1.indd 1

S:21"

D gath troit izati offe gust F e-sp nati Cha mus amo in-p mor boo The ` Au satio who area vate ing cap tion Som with run ` Au the perf view cur com show era Ope Yuv Mic ` Au

Deck here and here lj dljldjlj lj ldj ljdl

DETROIT HOMECOMING PREVIEW

Detroit Homecoming returns with hybrid experiences

S:21"

Detroit Homecoming, the annual gathering designed to re-engage Detroit-area "expats" in Detroit's revitalization, will enter its eighth year by offering a hybrid experience in August and September. Ford Motor Co. CEO Jim Farley, e-sports entrepreneur and Detroit native Delane Parnell, Detroit Lions Chair Sheila Ford Hamp and expat/ music powerhouse Don Was will be among the speakers during the in-person event, Sept. 23-26. And more than 25 speakers are also booked for three webcasts in August. The webcasts include: ` Aug. 17: "Coming Home," conversations with Homecoming alumni who have returned to the Detroit area to pursue livelihoods and private equity investors who are offering Michigan companies "patient capital" as an alternative to traditional private equity acquisitions. Some initiatives are open to expats with operating experience to own or run companies; ` Aug. 24: Discussions of the changes the pandemic will produce in the performing arts in Detroit, with previews of arts experiences that will occur during the September Homecoming, including the light-as-art show, Dlectricity, and BLISS, an opera marathon staged by the Michigan Opera Theater's new artistic director, Yuval Sharon, in the long vacant Michigan Theater downtown. ` Aug. 31: A conversation with Dar-

Jim Farley

Delane Parnell

ren Walker, president of the New York-based Ford Foundation, and Henry Ford III. Ford is the first family member to serve on the Foundation board since his grandfa-ther, Henry Ford II, resigned from the board in 1976 in irritation over the foundation's grant-making philosophy and direction. That session will be followed by a discussion among education and work-force leaders on how Detroit is positioning itself to attract more "big tech" jobs. Any Crain reader can register for the free webcasts by visiting https://bit.ly/2V9ZhTr. "We're excited about returning to an in-person format," said Homecoming Director Mary Kramer, who noted that Homecoming in 2020 was mostly online, with some in-person neighborhood tours for a small group of about 40 expats that attended in person. Typically, Homecoming attracts at least 200 expat attendees. This year, more than 30 speakers will take part in the "live" programming in September.

Don Was | RON BAKER/CREATIVE COMMONS

"Last year, we showed that our content has broad appeal; nearly 4,000 people registered for our virtual events in 2020. This year, in addition to the virtual sessions, we selected dates in September for in-person sessions to coincide with Dlectricity and BLISS because we wanted our 'expat' guests to experience some of

Detroit's 'best' in terms of arts and culture. We're thrilled to partner with WDET-FM to bring expat Don Was, a noted musician and music producer in his own right, to create a special Homecoming edition of his 'Don Was Motor City Playlist' with his cohost Ann Delisi." COVID-19 and the delta variant

are still a concern, Kramer said. "We're mindful of ongoing health concerns, and we'll work to ensure a safe and healthy environment, following recommended protocols from local health officials." Since 2014, Detroit Homecoming has documented about $600 million in economic outcomes tied to the event, including the Ballmer Group's expansion of its philanthropic footprint to Detroit and Southeast Michigan and the launch of an Opportunity Zone fund focused on rehabilitating multifamily housing. The in-person experience in September is designed for former Detroiters. Current residents can nominate friends or family who live outside the metro area at https://detroithomecoming.com/apply-to-attend/. Detroit Homecoming is produced by Crain's Detroit Business, with support from the Downtown Detroit Partnership, its nonprofit fiduciary for the event. Financial supporters include foundations and corporations, including the Ford Foundation, Kresge Foundation, William Davidson Foundation, W.K. Kellogg Foundation, DTE Foundation, Richard and Jane Manoogian Foundation, General Motors Co., Ford Motor Co. and Michigan Central, Rocket Companies and Urban Science. For more information about Detroit Homecoming, contact homecoming@ crain.com.

At Blue Cross Blue Shield of Michigan, we understand you want the best for your employees, which is why we offer a wide range of plans designed to fit any budget. Plans that give them access to the largest network of physicians and hospitals in Michigan wherever and whenever. We offer complete benefits with pharmacy, dental, vision and emotional well-being health for you and your employees. That’s the Blue Cross difference, which all adds up to smarter, better health care. See what a Blue Cross plan can do for your business.

Learn more at bcbsm.com/employers S:6.5"

Conﬁdence comes with every card.®

Blue Cross Blue Shield of Michigan and Blue Care Network are nonprofit corporations and independent licensees of the Blue Cross and Blue Shield Association.

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 5 7/9/21 12:08 PM

COMMENTARY

Film incentives make a big difference for workers

BLOOMBERG

BY TOM O'DONNELL AND JOHN FORD

FROM THE EXECUTIVE EDITOR

Home run: Crain’s cranks up residential real estate “Housing makes a place.” That’s how Arielle Kass, our new Crain’s Detroit Business residential real estate reporter, sums up the appeal of her beat – it resonates with everybody. “Everyone lives somewhere, and everyone has feelings about where they live, and so housing coverage affects people in a way that lends itself to storytelling,” she says. “It’s a huge investment, but it’s also very personal. “Whether there are multimillion-dollar homes or townhouses or bungalows or apartments helps define an area, who moves into it, what folKass lows.” Arielle will cover all of the above for Crain’s Detroit – new developments, market trends, industry personalities, housing policy and more. She joins senior reporter Kirk Pinho, who dominates the commercial real estate beat in metro Detroit, to form a powerhouse team that promises to elevate our coverage. Look for an upcoming residential Real Estate Insider column from Arielle to accompany Kirk’s popular commercial Insider, as well as a new video report featuring insights from their reporting – more details to come. You’ll also notice a beefed-up Tuesday Real Estate Report newsletter with our expanded coverage. The job is a homecoming of sorts for Arielle, a seasoned business reporter and Ohio

Kelley

ROOT

Executive Editor native who worked for our sister publication, Crain’s Cleveland Business, for several years early in her career. She comes to Crain’s Detroit from the Atlanta Journal-Constitution, where she spent the past 10 years covering a variety of beats, including residential real estate and finance; retail and logistics; and most recently, local government response to the pandemic. Prior to that, she covered finance and law for Crain’s Cleveland Business for two years, and planning and development for the Gwinnett (Ga.) Daily Post for four years. While in Atlanta, Arielle covered the city’s housing recovery and reported on foreclosures, home sales and investors buying homes, among other topics. She won multiple awards from the National Association of Real Estate Editors for her enterprise work. A graduate of Emory University in Atlanta, Arielle has family in Ohio and Michigan and is looking forward to relocating to metro Detroit: “I like the Midwest, so it was a good excuse to get back there.” Feel free to reach out to her with story ideas and tips at Arielle.Kass@crain.com. We’re glad to have her on board and think you will be, too.

We’ve seen this scripted act of fiction before. Every year at this time, so-called “experts” from biased, politically motivated think tanks release a report concluding it is time to call "cut" on film, TV, and streaming program tax credits nationwide, as a columnist did in the July 26 issue of Crain's. It’s a tired tale rooted in falsehoods. More importantly, it’s a story that fails to capture the real people impacted by the program credits — working-class people. As the heads of the International Alliance of Theatrical Stage Employees and Teamsters in the New York region, the tens of thousands of working-class union members we represent are living testaments to the importance of the film and TV industry. Our members are blue-collar, working-class individuals who go to work every day and look to the film, television and streaming production industry as a pathway to the middle class. The steady, full-time jobs provided by scores of productions enable them to put food on the table, provide for their loved ones and get access to quality health care. There are many industries that commonly receive tax incentives from states. Yet only the production incentive programs are flagged by conversative periodicals or pseudo-research- WORKERS ARE THE BACKBONE AND ers, who deem the benefit exclu- PULSE OF THE PRODUCTION INDUSTRY. sively to “liberal Hollywood” exproductions and the jobs they provide. Fanecutives and major corporate interests. The fact is that state production incentives tastical claims from misinformed and misonly began after Canada and other countries guided voices simply don’t tell the truth and offered them first two decades ago, siphon- ignore the real-life impacts of these programs. ing off thousands of jobs in this uniquely in- There are few pleasures greater than being a digenous industry. These production credits part of the magic of movies or joining a family go to the bottom-line workers behind the when working on TV shows. Our jobs support scenes, from carpenters to camera operators us and give us pride in making our state a to technicians and truck drivers. These work- unique cultural and economic hub. We give ers are the backbone and pulse of the pro- an ovation to lawmakers who have listened to duction industry, without whom the enter- the facts and said “Ready, Set, Action” to these tainment industry would not be able to programs. function. The increasing influx of new series and Tom O’Donnell is Motion Picture Division theatrical productions spurred by the emer- cirector of the International Brotherhood of gence of new streaming channels and other Teamsters and President of Teamsters Local platforms have provided increased opportu- 817. John Ford is a member of the executive nities for workers in these trades to continue board of the International Alliance of earning a livelihood doing what they love. Theatrical Stage Employees and President of These growth opportunities would not be IATSE Local 52.

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 | AUGUST 2, 2021

possible without the various production incentive programs offered across the United States, in turn, creating job opportunities from Georgia to Hawaii. For example, the numbers in New York paint an even clearer picture of the positive impact of these incentive programs. In 2017 alone, the state’s incentive program supported 48,300 middle-class jobs, delivering $4.3 billion in personal income and $6.7 billion in local spending. Those jobs, income and revenue would not be there otherwise. New York is part of the expanding national trend focused on supporting initiatives that encourage the creation of incentives that benefit working-class people. In their 2019 fiscal year, the industry generated $2.9 billion in direct production spending into the Georgia economy. That was money that went back into the local community. Small businesses also reaped the benefits with Georgia paying on average $693 million per year to vendors since 2015. The same story is in Massachusetts with the film and TV productions supporting more than 41,000 working class jobs and another 77,000 in Illinois. The state-by-state reopenings across the country mark the return of entertainment

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.

OTHER VOICES

Hands-free legislation still needed to save lives It’s been nearly five years since Paula Kiefer experienced every mother’s worst nightmare. She arrived home to a police officer waiting for her Glenn Stevens Jr. in her driveway is executive to give her the director of news that a disMICHauto and tracted driver vice president of had just taken automotive and the life of her mobility initiatives for the son — 18-yearold Mitchel KiefDetroit Regional er — the nameChamber. For sake and more inspiration of information the Kiefer Founabout this dation and its legislation or work to end dishow to get tracted driving. involved, please Sadly, Mitchvisit handsfreemichigan.org. el's story and the devasting loss experienced by his family remains far too familiar. In 2019, 3,142 people were killed in motor vehicle crashes involving distracted drivers, according to the National Highway Traffic Safety Administration. Eight times a day, a police officer in our country must have a conversation just like the one with Paula. Now is the time for legislative solutions that save lives. We urge our partners in the Michigan Legislature to support and pass House Bills 4277, 4278, and 4279, prohibiting drivers from using a mobile electronic device unless they are using it in a “hands-free” mode such as Bluetooth, Apple CarPlay, or Android Auto. While more people today recognize the dangers of using mobile devices while driving, too many still use them while operating their vehicles. This often occurs at high speeds on the freeway where drivers don’t appreciate what a difference even a few seconds can make. Imagine this: at 55 mph, taking your eyes off the road for only five seconds is essentially driving an entire football field with your eyes closed! Many people drive much faster than that to and from work each day. Some people have asked why we need a new law when Michigan already has a ban on texting while driving. The answer is simple: that law was passed in a different era, before phones had internet. Today, it is very difficult for an officer to determine when drivers are texting (which is illegal) and when they are on email, Facebook or shopping on Amazon (which is not). Due to the urgency of this issue, 24 states — Republican and Democrat — have adopted more comprehensive hands-free laws. Recent studies consistently show that these laws are dramatically reducing the rate of crashes and fatalities as a result of distractions caused by mobile devices. MICHauto has heard people say that innovation can solve a problem

that technology created. They contend that innovation in the form of autonomous and self-driving vehicles is right around the corner. As the voice of our state’s signature industry, MICHauto advocates for the bright future of autonomy and mobility. However, while we share the excitement about the potentially revolutionary impact autonomous vehicles will have on the world, full implementation of

the technology is likely decades off. In the meantime, more Michigan motorists, passengers, and pedestrians will die from entirely preventable accidents until this legislation passes. This September will mark five years since a distracted driver killed Mitchel. Together, we can honor Mitchel and those like him and ensure this senseless, preventable, and unimaginable tragedy doesn’t happen again.

GETTY IMAGES

BY GLENN STEVENS JR.

GET AN EXCLUSIVE SNEAK PEEK AT MICHIGAN’S COOLEST WORKPLACES VIRTUAL REVEAL | AUGUST 20 @ NOON

What workplace perks are ‘cool’ in 2021? Does working from home drive engagement and retention, or do other benefits matter more? Find out during our live reveal of the rankings for Michigan’s top 100 Cool Places to Work. Don’t miss our fast-paced, hour-long program, which includes a Q&A with the No. 1 company and more.

Be where cool happens: REGISTER TODAY at crainsdetroit.com/cool-event.

CATEGORY SPONSOR

SUPPORTING SPONSORS

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 7

SPECIAL REPORT | NONPROFIT COMPENSATION

SALARIES

From Page 1

Nonprofit CEO turnover is picking up as executives who paused their retirements during the pandemic move forward. Others are choosing to retire because of the pandemic, executive search consultants said. “It’s been taxing; it’s been stressful,” Miller said. “I would also put some credit that the stock market has done so well. People have done their financial reviews and said, ‘I could retire early.’ That’s also helped people make that decision” to retire. “We’re talking, now, about the end of the baby boomers and the next generations coming into leadership.” Gary Dembs, president of the Non-Profit Personnel Network, projects CEO turnovers in the sector will pick up even more between now and the end of the third quarter as leaders make decisions about retirement before next year and boards develop budgets for executive compensation plans and other aspects of operations. The retirements are driving up demand for leaders, yet the supply of next-generation talent is still somewhat damped by the Great Recession, when many nonprofit executives left the job market, sector or state, Miller said. “We did lose that generation of leaders in certain sectors,” Miller said, noting that’s leading to more national searches for talent. Nonprofits that hadn’t done succession planning and hadn’t developed internal candidates to move up were caught flat-footed after the Great Recession, agreed Susan Sulisz, managing director-executive compensation in the Southfield office of Willis Towers Watson (NASDAQ: WLTW). “We saw them work on that over the last 12 or 13 years. Now they’re in better shape but not necessarily great shape,” she said. “There’s a lot to do. It’s a constant process. You are working with someone and they choose to leave or do something different.”

Prizing diversity Within CEO searches there is also competition for diverse candidates, given heightened awareness of the need for diversified leadership, consultants said. That’s also driving higher compensation. “Everyone is seeking diversified leadership at the same time. We’re getting a push on that pool of candidates,” Miller said. To attract talent, many charities are putting in place signing bonuses that weren’t previously part of their compensation packages, Dembs said. Those have been the norm for larger nonprofits in areas like health care and education.

8 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

Sister Barbara Zimmer, an instructor with Mercy Education Project, leads a class. The nonprofit is in the middle of a CEO search amid rising turnover. | MERCY EDUCATION PROJECT

“Now even small and midsize nonprofits are making them a part of competitive packages,” Dembs said. Smaller organizations tend to have more discretionary bonus programs, where larger, more complex organizations are putting in place more formal bonus programs with target opportunities based on stipulated performance and financial metrics, said Tim Dupuis, a Detroit-based vice president for Chicago-based compensation firm Pearl Meyer & Partners LLC. That makes sense, given that complex and large nonprofits are increasingly competing with for-profit companies for CEOs, Dupuis said. “When we talk with boards, CEOs and CFOS ... there’s been a common understanding they want the top talent from anywhere, and it’s not just limited to other not-for-profit organi- Hale zations.” There is a new recognition that nonprofits are getting more complex, and therefore, they need top talent, Dupuis said. “In order to find top talent, (boards) have a newer understanding that during their recruiting process they need to look at candidates from all types of organizations, not just other nonprofit(s).” Pearl Meyer is consulting with 3040 larger nonprofits that are looking at both comparably sized nonprofits and for-profits, with the idea that if they needed to replace a senior management level position, their search would likely encompass both, Dupuis said. “The labor market is getting very competitive.”

Smaller budget Smaller nonprofits are facing the same competition as their larger

peers but with smaller budgets. Mercy Education Project in Detroit is in the midst of its fourth or fifth CEO search in six years, said Dan Hale, interim director and the head of the board’s search committee for a new executive director. Heidi Raubenolt, who served as executive director for a year and a half, left in February to become executive director of community services at Samaritas. Founded by the Sisters of Mercy of Detroit in 1992, the organization provides tutoring for girls in grades 2-12, adult literacy classes, GED classes, remedial education for adult women working toward their GED or other academic credentials and other programs on a budget of about $1 million. The volunteer-driven organization was long led by one of the Sisters of Mercy. In recent years, it has attracted younger leaders who stay for a short time to gain experience before moving on to other opportunities, not surprisingly since Mercy hasn’t offered compensation at the top of the pay scale, said Hale, a retired Trinity Health executive vice president. It’s also attracted business leaders who are nearing retirement, looking to give back and not as concerned about the level of compensation. But interestingly, its mission is garnering attention from several diverse candidates who could command more elsewhere, said Dembs, who is leading the search for Mercy Education Project. People choose to be in the nonprofit sector because of the mission, and the mission at Mercy is resonating with the candidate pool, he said. They are all aware of the pay range Mercy is offering, which has been stepped up a good percentage from the previous director to be competitive, Dembs said, and

candidates are comfortable with it. “These are candidates that could probably command a little more in the market, but the mission is resonating with them,” he said. “Post-pandemic, people are telling me they are being courted by a number of places, but they really think they can step Mercy up to its previous glory and they want the chance to do that.” Nonprofit boards increasingly recognize the premium they may have to pay to secure a leader who can help execute the organization’s strategic vision, said Miller, the executive search consultant. But many declined to discuss rising compensation for nonprofits with Crain’s over concerns about the message it would send to donors. “Not all donors and other constituencies appreciate that executive compensation is not a cost, but a question of what multiple of value you receive with each new leader in terms of new services/programming and funding sources for sustainable and maximum impact,” Miller said. That need across nonprofits will continue to drive the average pay in the sector up, even for smaller and midsize social services agencies. CEOs of those organizations have earned the least of any nonprofit subsector every year in Crain’s Nonprofit Salary Report. But the average pay for the top 10 social services CEOs on Crain’s 2018 list grew by nearly $100,000 the decade before as bonuses and higher salary increases came into play. Going forward, Southwest’s board recognizes it will have to increase its CEO’s salary as he gains more tenure, Chair Stephanie Miller acknowledged. The challenges faced by its community mental health, affordable housing and economic development divisions require a leader talented in all of those areas, who is able to build and maintain a talented team, bring connections to corporate foundations and government and the ability to build a rapport with potential supporters, she said. Oakbrook, Ill.-based WittKieffer Inc., which worked with the nonprofit on its recent search, recommended a salary for the new CEO based on the rates nonprofit CEOs across the country are commanding and what would work in this region and state, Miller said. It wasn’t outrageous but not rock bottom either and was consistent with what de Four had indicated he would accept. “Everyone on the board recognized that we had a jewel in (retired CEO) John Van Camp, but we also knew we needed John Van Camp 3.0.” Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

2020 was a year of extremes: Leaders saw pay cuts and bonuses Nonprofit CEO compensation swung between two extremes last year. Leaders of nonprofits hit hardest by the pandemic saw pay cuts and pay freezes, while organizations that benefited from lower claims and costs awarded bonus payouts to their leaders. The year of the pandemic will be marked by heavy board discretion in awarding bonuses to executives or, in some cases, reducing them. And it will mark the beginning of new diversity, equity and inclusion targets as one determiner of performance-based bonus payouts. Pay cuts for the nonprofit CEOs that received them last year have been restored, for the most part, compensation consultants said, but not retroactively. Compensation trends with Dupuis annual increases and incentive bonus opportunities are already returning to “normal” this year or expected to in 2022. “We expect to see a dip in 2020, then (compensation) go back up maybe a little lower than before and continuing on an upward trend,” said Susan Sulisz, managing director-executive compensation Sulisz in the Southfield office of Willis Towers Watson (NASDAQ: WLTW). Arts and culture groups and health systems were among the hardest hit during the pandemic. Those organizations furloughed employees and cut/ froze executives’ pay to counter COVID-19’s financial impact. But others, such as not-for-profit health insurers, had good financial years in 2020 because claims were very low, said Tim Dupuis, a Detroit-based vice president for Chicago-based compensation firm Pearl Meyer & Partners LLC. Those organizations likely saw a positive impact on their bottom lines as a result of lower claims. “For those organizations, it was business as usual,” he said. “We didn’t really see furloughs or pay cuts, and their incentive programs for 2020 more than likely paid out very well.” Nonprofits that were heavily impacted by the pandemic skipped salary increases in 2020 and some in 2021,

Dupuis said. For those groups, raises and other compensation are expected to return to normal for 2022. “We might see larger pay increases in 2022 for those organizations that were forced to freeze pay for the last 12-18 months,” he said. “It’s still very early in the process, but we are having conversations with organizations that were heavily impacted.” For some leaders who took pay cuts and pay freezes, 2020 will be a lost year with no recovery of lost wages and no progression in pay. Detroit Institute of Arts Director Salvador Salort-Pons took a 20 percent pay cut in June 2020, along with other museum executives. Bonuses for him and other executives were also held back last year, said Christine Kloostra, executive director, marketing and communications. The museum restored the pay cuts July 1, but it did not pay lost compensation retroactively, she said. DIA employees earning annual compensation of $50,000 or an hourly compensation of $24.04 or less did receive a 2.5-percent annual increase in pay last year, along with increases paid to all union employees. “There was a lot of attention paid to equivalency of treatment between executives and the broader base of employees. They were very careful about equitable treatment,” Sulisz said.

Restoring pay cuts While the DIA only restored pay cuts a month ago, other local leaders saw their pay reinstated before the close of 2020. Beaumont Health CEO John Fox’s base salary was restored in August 2020 after two months of financial recovery and the callback of the majority of employees furloughed in April 2020, said Mark Geary, director, external communications and media relations. In 2019, Fox earned total compensation of $6.75 million, including base salary of $1.89 million and bonus See BONUSES on Page 10

CRAIN’S ILLUSTRATION/GETTY IMAGES

BY SHERRI WELCH

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 9

SPECIAL REPORT | NONPROFIT COMPENSATION

CRAIN’S LIST | TOP-PAID NONPROFIT EXECUTIVES

This tion non cale non It inc judg

Ranked by 2019 total compensation per category Nonprofit organization

ARTS AND CULTURE Anthony Michaels, president & CEO

Michigan Thanksgiving Parade Foundation/The Parade Co.

Patricia Mooradian, president and CEO Dominic DiMarco, president Ron Kagan, executive director & CEO

The Henry Ford (The Edison Institute Inc.) Cranbrook Educational Community Detroit Zoological Society

Salvador Salort-Pons, director, president and CEO

Detroit Institute of Arts

BUSINESS ORGANIZATIONS Sandy Baruah, CEO and president Sandra Bouckley, CEO and executive director1

Detroit Regional Chamber1 SME (formerly Society of Manufacturing Engineers)

Luxury retail space available

Eric Larson, president and CEO Terry Barclay, president and CEO

Downtown Detroit Partnership Inforum

Supporting a more walkable, vibrant and beautiful Birmingham

FUNDRAISING FOUNDATIONS Christopher Palazzolo, president and CEO Robert Hoban, president and CEO Margaret Cooney Casey, president, treasurer Jill Hunsberger, associate VP for advancement Paul Miller, president

Ascension Providence Rochester Foundation Ascension St. John Foundation and Ascension Providence Foundation Beaumont Health Foundation Eastern Michigan University Foundation Presbyterian Villages of Michigan Foundation

GRANTMAKING FOUNDATIONS Audrey Harvey, executive director and CEO Richard Rapson, president & CEO Mariam Noland, president David Egner, president & CEO

Blue Cross Blue Shield of Michigan Foundation The Kresge Foundation Community Foundation for Southeast Michigan Ralph C. Wilson Jr. Foundation

Darin McKeever, president and CEO

William Davidson Foundation

HEALTH CARE Daniel Loepp, president & CEO Philip Incarnati, president and CEO John Fox, president and CEO Wright Lassiter, CEO1 Mike Slubowski, president and CEO, Trinity Health

Blue Cross Blue Shield of Michigan/Blue Care Network McLaren Health Care Beaumont Health Henry Ford Health System Trinity Health Michigan

SOCIAL SERVICES Robert Cahill, president & CEO Steve Fetyko, president & CEO1 Roger Myers, president and CEO, PVM Darienne Hudson, CEO Scott Kaufman, CEO Sam Beals, CEO

Hospice of Michigan United Methodist Retirement Communities Presbyterian Villages of Michigan United Way for Southeastern Michigan Jewish Federation of Metropolitan Detroit/United Jewish Foundation Samaritas

OTHER Kevan Lawlor, president and CEO Lincoln Smith, former president, CEO and trustee1 Clark Durant, president Kristen Holt, president and CEO Lou Glazer, president

NSF International Altarum Institute New Common School Foundation GreenPath Financial Wellness Michigan Future Inc.

COMING TO

BIRMING

HAM

MapleBates

FOR LEASING INFORMATION, CONTACT

ANGELA THOMAS (248) 359-3838

ERICA DUNLAP (248) 359-3808

www.signatureassociates.com

REDEFINING

RELATIONSHIP BANKING TREASURY MANAGEMENT Your goals are within our reach. Let single-source treasury management streamline the process of meeting your projections and make achieving goals easier than ever. Trust the only bank that keeps your holdings close to heart. We’re redefining relationship banking. Your way.

Troy – 5600 New King Dr. Suite 150 Troy, MI 48098 248-886-0086 | Toll-free: 866-707-2871 www.waterfordbankna.com Member FDIC. Equal Housing Lender.

20 co

2019 top executive

All loans subject to credit approval. NMLS# 520256

BONUSES

From Page 9

payments of $2.6 million. Wages for Patricia Mooradian and other executives at The Henry Ford, who saw pay cuts of 20-25 percent last year, were restored in July 2020 when its Dearborn attractions reopened to the public, said Wendy Metros, senior director, media relations and studio productions. In 2019, the most recent year available, Mooradian’s base pay was $474,524. She also earned a bonus of $125,580. Mooradian did not receive a bonus for 2020 or money retroactively to make up for the pay cut. Her compensation is back to normal for 2021, Metros said. But the Detroit Zoo waited to restore pay cuts until this year in March for Executive Director and CEO Ron Kagan and other executives, said Rachelle Spence, se-

nior communications manager. His salary for 2020 was $377,213, and Kagan received an $800 bonus in January 2020, she said. That compares to base compensation of $432,076 and a bonus of just under $30,000 in 2019.

Discretionary bonuses — or not Last year was marked by board use of discretionary bonuses, compensation consultants said. Given that many executives had little or no chance of hitting targets tied to performance-based bonuses, some boards awarded discretionary bonuses of about half the earnings opportunity a performance-based bonus would have provided, Dupuis said. “We’re not talking about discretion where it would be an exorbitant amount of pay,” he said.

“It was recognition that things happened outside of employees’ control, and people were doing whatever they could.” Boards also exercised discretion in the other direction, Sulisz said. “In some cases, you might have had a better year, not necessarily due to performance but due to the pandemic.” Some nonprofits did better financially during the pandemic as costs dropped, but the better financial fortunes weren’t necessarily a result of management performance, she said. “Therefore, we’ve seen boards exercise discretion downward, again, very sensitive to what others were experiencing.”

Tracking DEI The increased focus on diversity, equity and inclusion in 2020 and 2021 is yielding a shift in executive compensation measurables that compensation consultants predict is here to stay. Larger nonprofits, such as health insurers and health systems, are look-

Com

The mon 10 a

Med liste

2.9

Med

ing a cus exec Th DEI agai “C cuss and sion plan It age

haptrol, they

n in

had e to em-

nanosts forlt of id. xervery peri-

sity, 2021 pennsastay. alth ook-

This chart includes selections from Crain’s database of compensation of the top executives at prominent Southeast Michigan nonprofits. This year’s review focused on compensation data for calendar year 2019, which is the most recent available based on nonprofit Form 990 tax filings. It includes large nonprofits and smaller organizations that in our judgment merited inclusion, such as civic and business

organizations and smaller nonprofits whose CEOs earned compensation comparable with their peers at larger nonprofits. The total compensation for some executives, where noted, is net of deferred compensation reported on a prior-year 990 to give a more accurate picture of that executive’s actual compensation and a truer ranking. In the interests of transparency, some nonprofits still completing 990s provided compensation data for their top executives upon request. Base pay change 2019/2018 City

Salary database available Published here are a selection of the top-paid nonprofit executives in Southeast Michigan, broken out by the type of nonprofit. An expanded version of this list with salary information for more than 150 executives is available in Excel format with a Crain’s All Access + Data subscription at crainsdetroit.com/data.

2019 CEO total compensation

2019 base compensation

2018 base compensation

2018 total compensation

$668,8581

$344,258

$557,585

$657,585

-38.3%

$654,704 $611,025 $487,716

$474,524 $441,238 $432,076

$407,456 $430,150 $421,601

$573,307 $515,276 $482,043

16.5% 2.6% 2.5%

$477,584

$446,921

$421,821

$452,349

6.0%

$640,503 $611,958

$394,022 $520,7872

$535,600 $232,434

$554,306 $498,700

-26.4% 124.1%

Detroit Dearborn

$425,819 $345,539

$299,904 $292,183

$274,964 $332,440

$298,158 $343,764

9.1% -12.1%

Detroit Detroit

$1,148,037 $833,258 $657,954 $178,536 $144,550

$543,975 $495,265 $398,954 $127,526 $138,539

$391,992 $125,889 $143,834

$725,980 $176,245 $151,841

1.8% 1.3% -3.7%

Ypsilanti Southfield

$955,060 $930,865 $657,431 $635,699

$297,989 $809,343 $572,944 $533,361

$289,634 $787,061 $556,705 $455,373

$781,223 $909,227 $639,494 $488,373

2.9% 2.8% 2.9% 17.1%

Detroit 1. Compensation from the organization and related organizations. Troy Detroit Grosse Pointe Farms

$562,878

$500,000

$410,000

$462,900

22.0%

Birmingham

$12,104,983 $8,155,554 $5,109,948 $3,690,408 $2,965,730

$1,537,661 $7,968,695 $1,888,740 $1,621,355 $1,665,425

$1,537,661 $1,977,959 $1,848,289 $1,493,805

$19,223,351 $7,311,341 $4,224,061 $3,569,911 $0

0.0% 302.9% 2.2% 8.5%

Detroit Grand Blanc Southfield Detroit Canton

$719,887 $481,305 467,480.00 393,863.00 375,719.00 373,005.00

$507,971 $359,920 374,968.00 350,000.00 355,405.00 296,776.00

$495,743

2.5%

374,968.00 164,268.00 348,216.00 288,073.00

$724,031 0 467,480.00 176,176.00 402,796.00 355,521.00

0.0% 113.1% 2.1% 3.0%

$2,748,748 $822,206 $752,142 $382,574 $178,500

$701,660 $409,122 $575,000 $346,776 $162,500

$647,436 $394,733 $475,000 $320,294 $200,0001

$1,876,069 $1,183,650 $843,475 $434,054 $215,500

8.4% 3.6% 21.1% 8.3% -18.8%

Notes 1. Not included is $48,000 from Woodward Dream Cruise listed on the 2019 990 as reportable compensation that the organization said was paid to The Michaels Group for consulting services.

Dearborn Royal Oak Detroit

Ann Arbor Chelsea Southfield Detroit Bloomfield Hills Detroit

1. Compensation from the organization and related organizations. 1. Former CEO Jeffrey Krause left the organization in August 2018. 2. $48,957 from related organization. 3. Compensation from the organization and related organizations.

1. 2020: From annual statement for the year ending in Dec. 31, 2019. 1. Compensation from the organization and related organization. 1. Lassiter serves as CEO of Henry Ford Health System and president of Henry Ford Health System Foundation. 1. Succeeded Michael Slubowski on July 1, 2019.

1. Named CEO May 2019. For 2019, $481,305 reported as deferred compensation on prior year 990. Joined the agency in July 2018 as CEO.

Ann Arbor Ann Arbor

1. Retired

Farmington Hills Ann Arbor

1. Compensation from nonprofit. Compensation from the organization and related organization.

Nonprofit compensation by the numbers Compensation paid in calendar 2019 is the most recent available for nonprofit CEOs and other top-paid executives. The 990 financial disclosures forms nonprofits are required to file with the Internal Revenue Service are due four and a half months after the close of their fiscal years. But nonprofits can request a six-month extension which gives them a total of 10 and a half months to file their 990s for the previous year. Median pay rates and increases for the Southeastern Michigan executives on Crain’s top-paid nonprofit CEOs listed above in 2019 were:

2.9 percent

-4.1 percent

$396,262

$481,640

Median base pay increase

Median total compensation change

Median base pay

Median total compensation

ployees who are diverse, Dupuis said. He’s also noted conversations about putting in place operational metrics around DEI. Those could include, for example, creating an internal diversity platform led by members of the organization’s leadership team, which hosts all-staff or optional staff calls to provide quarterly updates on what the organization is doing to maintain and grow a diverse culture, he said. Dupuis projects DEI targets tied to

incentive compensation will be a permanent shift. “There is such a push from institutional groups to focus on diversity. And large publicly traded companies are now required to disclose certain numbers on employee diversity,” he said. “Regulators are requiring it, so I think it’s here to stay.”

ing at how they can include a DEI focus in the performance targets for top executives, Dupuis said. The hard part is figuring out what DEI targets to set and how to measure against them, he said. “Committees are having lots of discussion about how they can improve and even include diversity and inclusion metrics into their incentive plans.” It could be as simple as the percentage of your management-level em-

Contact: swelch@crain.com; (313) 446-1694; @SherriWelch AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 11

CRAIN'S LIST | LARGEST LOCAL AUTO DEALERS Ranked by 2020 revenue COMPANY ADDRESS PHONE; WEBSITE

TOP EXECUTIVE(S)

REVENUE ($000,000) 2020

REVENUE ($000,000) 2019

PERCENT CHANGE

NUMBER OF DEALERSHIPS

NUMBER OF NEW VEHICLES SOLD, LEASED 2020/2019

NUMBER OF USED VEHICLES SOLD 2020/2019

THE SUBURBAN COLLECTION 1

David T. Fischer Jr. president

$2,421.1

$2,730.8

-11.3%

43 2

29,314 2 35,799 2

20,682 2 23,453 2

SERRA AUTOMOTIVE INC. 3

Joseph Serra president & CEO

$2,195.1

$2,039.9

7.6%

52 2

33,045 2 32,070 2

30,822 2 29,839 2

VICTORY AUTOMOTIVE GROUP INC.

Jeffrey Cappo president

$2,094.5 2

$2,122.1 2

-1.3%

NA 39,768 2

NA 24,885 2

FELDMAN AUTOMOTIVE INC.

Jay Feldman chairman & CEO Dave Katarski COO & executive VP

$1,292.3

$1,043.8

23.8%

NA 16,530

NA 10,870

LAFONTAINE AUTOMOTIVE GROUP

Michael LaFontaine chairman & owner

$1,241.0

$1,156.6

7.3%

19,623 18,462 2

11,180 11,227 2

GOLLING AUTOMOTIVE GROUP

Bill Golling president

$449.6 2

$406.5 2

10.6%

NA NA

SOUTHFIELD CHRYSLER DODGE JEEP RAM

Chris Snyder general manager

$425.3 4

$441.0 4

-3.6%

NA NA

JIM RIEHL'S FRIENDLY AUTOMOTIVE GROUP INC.

James Riehl Jr. president & CEO

$376.6

$358.1

5.2%

NA NA

ELDER AUTOMOTIVE GROUP

Tony Elder president

$319.2 4

$331.0 4

-3.6%

NA NA

PRESTIGE AUTOMOTIVE

Gregory Jackson chairman & CEO

$308.6

$309.4

-0.3%

NA 8,325

NA 1,511

STEWART MANAGEMENT GROUP INC.

Gordon Stewart president

$290.4 4

$301.1 2

-3.5%

NA NA

SNETHKAMP AUTOMOTIVE FAMILY

Mark Snethkamp president

$254.6 4

$264.0 4

-3.6%

NA NA

ROYAL OAK FORD/BRIARWOOD FORD

Eddie Hall Jr. president & CEO

$241.9

$270.5

-10.6%

NA NA

PAT MILLIKEN FORD INC.

Brian Godfrey president Bruce Godfrey chairman

$215.0

$230.0

-6.5%

NA NA

MATICK AUTOMOTIVE 5

Karl Zimmermann owner & operator

$200.2 4

$207.6

-3.6%

NA 4,491

NA 2,467

BOWMAN AUTO GROUP (BOWMAN CHEVROLET)

Katie Bowman Coleman president & owner

$162.6

$172.4

-5.7%

2,944 3,839

645 1,252

RAY LAETHEM INC.

Jeff Laethem president

$144.7 4

$150.0 4

-3.6%

NA NA

MILOSCH'S PALACE CHRYSLER-JEEP-DODGE INC.

Donald Milosch president

$141.8 4

$147.0 4

-3.6%

NA NA

JEFFREY TAMAROFF AUTOMOTIVE FAMILY

Jeffrey Tamaroff chairman and CEO Marvin Tamaroff chairman emeritus Jason Tamaroff and Eric Frehsee, vice presidents

$125.7

$154.9

-18.9%

NA NA

GORNO AUTOMOTIVE GROUP

Ed Jolliffe president

$123.6

$127.3

-2.9%

NA NA

VILLAGE FORD INC.

James Seavitt president & CEO

$120.6 4

$125.0 4

-3.6%

NA NA

AVIS FORD INC.

Walter Douglas Sr. chairman Mark Douglas president

$112.9

$132.1

-14.5%

NA NA

BILL PERKINS AUTOMOTIVE GROUP

Bill Perkins president

$97.7

$118.7

-17.7%

1,890 2,358

1,048 1,645

GLASSMAN AUTOMOTIVE GROUP INC.

George Glassman president

$79.8

$90.9

-12.3%

1,794 2,430

834 901

MICHAEL BATES CHEVROLET

Michael Bates owner & dealer principal

$78.0 4

$87.0 4

-10.4%

NA NA

1795 Maplelawn Drive, Troy 48084 877-471-7100 suburbancollection.com

102 W. Silver Lake Road, Fenton 48430 810-936-2730 serrausa.com

46352 Michigan Ave., Canton Township 48188 734-495-3500 victoryautomotivegroup.com 30400 Lyon Center Drive East, New Hudson 48165 248-486-1900 feldmanauto.com

4000 W. Highland Road, Highland Township 48357 248-887-4747 thefamilydeal.com 2405 S. Telegraph Road, Bloomfield Hills 48302 248-334-3600 golling.com 28100 Telegraph Road, Southfield 48034 248-354-2950 southfieldchrysler.com 32899 Van Dyke Ave., Warren 48093 586-979-8700 jimriehl.com 777 John R Road, Troy 48083 248-585-4000 elderautogroup.com

20200 E. Nine Mile Road, St. Clair Shores 48080 586-773-1550 prestigeautomotive.com 20844 Harper Ave., Suite 100, Harper Woods 48225 313-432-6200 gordonchevrolet.com 16400 Woodward Ave., Highland Park 48203 313-868-3300 snethkampauto.com 27550 Woodward Ave., Royal Oak 48067 248-548-4100 royaloakford.com

9600 Telegraph Road, Redford 48239-1492 313-255-3100 patmillikenford.com

14001 Telegraph Road, Redford Township 48239 313-531-7100 www.matickauto.com 6750 Dixie Highway, Clarkston 48346 248-795-1841 bowmanchevy.com 18001 Mack Ave., Detroit 48224 313-886-1700 raylaethem.com 3800 S. Lapeer Road, Lake Orion 48359 248-393-2222 palacecjd.com

28585 Telegraph Road, Southfield 48034-1928 248-353-1300 tamaroff.com

22025 Allen Road, Woodhaven 48183 734-676-2200 gornoford.com 23535 Michigan Ave., Dearborn 48124 313-565-3900 villageford.com 29200 Telegraph Road, Southfield 48034 248-355-7500 avisford.com

13801 S. Telegraph Road, Taylor 48180 734-287-2600 taylorchevy.com

28000 Telegraph Road, Southfield 48034 248-354-3300 glassmanautogroup.com 23755 Allen Road, Woodhaven 48183 734-676-9600 michaelbateschevy.com

Researched by Sonya D. Hill: shill@crain.com | This list of local auto dealers is an approximate compilation of the largest such businesses in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. Dealership companies must have local stores to be included on this list. Penske Automotive Group is not on this list because, while it is locally headquartered, it doesn’t have local car dealerships. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the companies. Actual revenue figures may vary. NA = not available. NOTES: 1. Lithia Motors Inc acquired The Suburban Collection in April. 2. Automotive News. 3. Serra Automotive Inc. purchased Buff Whelan Chevrolet in February. 4. Crain's estimate. 5. Includes George Matick Chevrolet, Matick Toyota and Matick Auto Exchange.

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data 12 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

WHAT’S THE SOLUTION? Dealing with plastic in the Great Lakes won’t be easy. PAGE 14 RAW MATERIALS: Legislators look to reduce flow of tiny plastic pellets into water. PAGE 15

GREAT LAKES POLLUTION

BIG BRANDS: Shareholders add pressure on consumer products to reduce plastic use. PAGE 20

STEPHEN J. SERIO

SWIMMING IN PLASTIC Great Lakes microplastics pollution showing up in fish, birds — and your beer glass | BY ERIC FREEDMAN This Crain’s Forum on the emerging threat of microplastics pollution in the Great Lakes is a joint project of the newsrooms of Crain’s Chicago Business and Crain’s Detroit Business.

an integral component of human cultures and commerce globally” and accounted for 50 to 80 percent of waste on beaches and in the ocean, according to a study of microplastics in fish. The long life and durability of plastics make them useful for consumers, but the slow rate at which they degrade also means their adverse environmental effects are long-lasting. Plastics don’t dissolve easily in water and can absorb nasty chemicals from the environment, some of them toxic or carcinogenic.

They absorb bacteria and metals, can be toxic to human cells, transport invasive species, block animals’ digestive tracts and reduce the ability of wildlife to forage for food. That’s why microplastics, which are less than 5 millimeters or 0.2 inches in diameter, are considered a contaminant of emerging concern. Microplastics originate from fibers released during clothes washing and from industrial waste, landfills, pollution, spills, synthetic textiles, tires and abrasive cleaning particles. Other sources include fragments of such litter as plastic bags, cigarette filters, Styrofoam containers and abandoned fishing line. See PLASTICS on Page 18

SHERRI MASON/PENN STATE BEHREND

They’re in your microbrew. They’re in your tap water. They end up in the bellies of your lake trout. They get between your toes as you scramble up and slide down shoreline dunes. They’re microplastics. They are getting into your body. And they’re coming from a source that’s a lot closer to home than you think. We’ve all seen images of floating islands of plastic in the Caribbean and Pacific. What most of us have managed to avoid thinking about, however, is this: Plastic waste also is a serious problem in the Great Lakes Basin, the source of drinking water for 40 million people in the U.S. and Canada. “In the mid-1900s, plastic became

Microplastics are less than 5 millimeters or 0.2 inches in diameter and considered an emerging contaminant in the Great Lakes. AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 13

Reducing plastic pollution won’t be easy Keeping plastic out of the lakes in the first place is easier than cleaning out what’s already there BY ERIC FREEDMAN

Similarly, sea lampreys invaded lakes Huron, Michigan and Superior An estimated 22 million pounds of in the 1930s, outcompeting native plastic pollute the Great Lakes annu- species like lake trout. Nine decades ally, adding to the tons of plastic later, scientists are still seeking the waste already in the water and sedi- best way to control them, and the ment that threatens the health of fish, Great Lakes Fishery Commission concedes that “total elimination of wildlife and humans alike. sea lamprey populations from the So what’s to be done? When it comes to solutions, there Great Lakes is unlikely.” The first challenge is slashing the are actually two major problems: reducing the influx of plastics into the amount of plastics entering the lakes lakes and handling the microplastics and tributaries. Part of the answer is encouraging already there. “Once it’s in the lakes, it’s extremely local governments to act on their own difficult to get it out,” said Jennifer turf, as is happening in St. Catharines, Caddick, vice president of communi- Ontario, which has banned plastic wacation and engagement at the Chica- ter bottles and is phasing out other go-based Alliance for the Great Lakes, plastic beverage containers at citywhich organizes beach cleanups along owned facilities. The Lake Ontario city the shorelines of all five Great Lakes. about 10 miles northwest of Niagara Past efforts to address environmen- Falls also banned plastic straws and tal messes in the Great Lakes highlight eating utensils at its facilities, includhow effective solutions to both prob- ing a hockey arena, and requires biolems will be costly, time-consuming, degradable plates and utensils at festivals in city park. “We can be on the WHEN IT COMES TO SOLUTIONS, THERE leading edge, the front ARE ACTUALLY TWO MAJOR PROBLEMS. end,” said Walter Sendzik, the St. Cathascientifically challenging and some- rines, Ontario, mayor who chairs the times politically contentious. Great Lakes and St. Lawrence Cities For example, the 1972 U.S.-Canadian Initiative, a coalition of 131 U.S. and Great Lakes Water Quality Agreement Canadian mayors and local officials. designated 43 heavily contaminated “We’re the closest to the shoreline, areas of concern as priorities for envi- we’re the closest to the water source,” ronmental cleanup. Almost 50 years Sendzik said of Great Lakes commuand billions of dollars later, only eight nities. of those sites have been dropped from State, provincial and federal govthe list, with a ninth, northeast Ohio’s ernments have more regulatory auAshtabula River that flows into Lake thority, “but their proximity to the Erie, recently proposed for delisting. actual issues is one, two, three, four 14 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

Packaging litter breaks down in the lakes into smaller and smaller pieces that are then ingested by fish and other wildlife.

steps removed,” he said. State and provincial governments could take broader regulatory measures to discourage use and disposal of plastic products that may end up in the lakes. Eight states — including New York in the Great Lakes region — have enacted some form of restrictions on single-use plastic bags, according to the National Conference of State Legislatures. On Chicago City Council, there's a proposed ordinance to prohibit restaurants from using plastic clamshells, bowls, plates, trays, cups and cartons and only allowing them to give patrons plastic utensils or straws upon request. In April, Michigan state Sen. Jeff Irwin, D-Ann Arbor, introduced a bill that would give localities the option of

banning, taxing or imposing fees on single-use plastic bags. It would repeal a 2016 “ban the ban” law, championed by the restaurant industry and other retailers, that prohibits local governments from imposing such restrictions. “Other communities have shown success in keeping trash off their roads, beautifying their communities and keeping this trash out of their rivers and streams by introducing limits, deposits or other creative ideas to improve plastic bag recycling,” Irwin said in a statement. Odds of Irwin’s bill passing in the state’s GOP-controlled Legislature are slim, however. Past national actions on both sides of the border have helped. In 2015, Congress banned the man-

ufacture, packaging and distribution of personal care items and toiletries containing plastic microbeads such as facial scrubs and toothpastes. The Canadian government followed suit in 2018. Both national governments acted after lobbying by mayors citing scientific findings and environmentalists’ concerns, Sendzik said. “It’s a really good example of how the political will of mayors can change the course of something as important as taking out a product proven detrimental to our waterways,” he said. Recently reintroduced legislation in Congress would hold producers of packaging, single-use products, beverage containers and food service products financially responsible to collect, manage and recycle or compost the products after consumer use. Dubbed the “Break Free from Plastic Pollution Act of 2021,” it would phase out some single-use products such as plastic utensils, establish beverage container deposit programs and increase the percentage of recycled content required in beverage containers. Congress has failed to act on similar legislation in the past. Environmental groups have urged policymakers to take a broader approach to curbing plastics in consumer products instead of letting a smattering of communities enact bans on certain types of plastic products. “We need to move away from this whack-a-mole approach to dealing with one problem at a time—a plastic bag ban or a plastic straw ban, the item of the moment,” said Caddick at the Alliance for the Great Lakes.

PHOTOS BY STEPHEN J. SERIO

BY C

M Con the win Lak fish S inte Th lets— size factu are c Th ronm Dur lead the ers into Dur EPA B whe up i unli factu B plas Lake from ing port Th

on of cons faana018. cted ienists’

how ange tant etri-

tion rs of bevvice e to omuse. Plasould ucts bevams ecyrage o act

rged apummats on

this ling astic the ck at

Durbin bill targets plastic pellet polluters

PHOTOS BY STEPHEN J. SERIO

BY CHAD LIVENGOOD

McDonald’s Corp. straws and Dart Container Corp.’s plastic cups aren’t the only petroleum-based materials winding up in the sediment of Great Lakes beaches and the stomachs of fish and waterfowl. Some plastic doesn’t even get to its intended use. The tiny preproduction plastic pellets—known as nurdles, roughly the size of rice grains and used in manufacturing those consumer products— are commonly found in the lakes. That’s drawn the attention of environmental groups and U.S. Sen. Dick Durbin, an Illinois Democrat who is leading an effort in Congress to make the EPA prohibit plastic manufacturers from discharging plastic pellets into lakes, rivers and streams. Durbin’s bill would empower the EPA to set regulations and penalties. Because of how small the pellets are, where they came from before ending up in the lakes is impossible to track, unlike a distinctive red Solo cup manufactured by Mason, Mich.-based Dart. But scientists who have studied plastic pellet pollution in the Great Lakes say the pellets typically originate from a plastics refinery, manufacturing plant or somewhere in the transportation between the two facilities. The pellets may be spilled on site

Preproduction plastic pellets used for injection molding are seen as an emerging source of plastic pollution in the Great Lakes. | CAROLINE SEIDEL/PLASTICS NEWS

and get washed into a drain basin, eventually making their way into the streams, rivers and lakes that feed lakes Erie, Huron, Michigan, Ontario, St. Clair and Superior, said Sherri Mason, the sustainability coordinator at Penn State Behrend whose research focuses on Great Lakes plastic pollution. In Erie, Pa., alone, there are a dozen plastics manufacturers that get resin pellets shipped in by train cars, Mason said. “Along the way, as they’re transferred from one container to another, these pellets get lost,” she said. Mason said she has found plastic

pellets in the parking lot of Presque Isle, a Pennsylvania state park on a sandy peninsula that juts out into Lake Erie. “Why the heck are they in a parking lot at Presque Isle?” Mason asked. “They probably got washed from the lake during a storm surge ... into the parking lot. It’s crazy.” Legislation seeking to impose some regulations and penalties on plastics producers for polluting freshwaters with plastic pellets is starting to gain steam in Congress. The $715 billion infrastructure bill that the U.S. House passed on July 1

includes language requiring the EPA to write national rules prohibiting the discharge of plastic pellets—mirroring Durbin’s Plastic Pellet Free Waters Act in the Senate. “The Plastic Pellet Free Waters Act is an important step in addressing the plastic problem that is plaguing our beloved Lake Michigan and the first of several steps I plan to take this year to improve the Great Lakes and the surrounding communities,” Durbin said in a statement. The Plastics Industry Association opposes Durbin’s bill. “We are concerned that, as written, a provision within this legislation opens the door to regulatory overreach that could subject countless small plastics operations across America to heavy-handed federal enforcement,” said George O’Connor, spokesman for the Washington, D.C.-based trade group. The Plastics Industry Association’s members have a 30-year-old voluntary program to prevent pellet pollution called “Operation Clean Sweep” that promotes best “housekeeping” practices in containing resin pellets, flakes and powders from escaping during refining, transportation and manufacturing. “Plastic is an essential material, and we completely agree that it doesn’t belong in the environment,” O’Con-

nor said. “We look forward to continuing to work with lawmakers and regulators on reasonable solutions to reduce the issue of pellet loss.” Another piece of legislation also has drawn the ire of plastics manufacturers in Michigan. A California congressman is sponsoring a bill in the House called the Break Free From Plastic Pollution Act that would require manufacturers to manage recycling of single-use plastic containers, tax plastic bags and expanded polystyrene or foam food containers nationally, as well as set up a national bottle bill similar to Michigan’s 10-cent deposit per container. Dow Inc. CEO Jim Fitterling, who chairs the American Chemistry Council, has spoken out against the Break Free From Plastic Pollution Act because it would halt construction of new virgin plastic plants for up to three years, Plastics News reported. “It would prevent advanced recycling technologies that can dramatically expand the types and amounts of plastics that can be recycled,” Fitterling said at the time. “Under the Act, these facilities are subject to a pause. We need to accelerate, not pause, progress on these important recycling innovations.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

A Foundation on the move. 2021 ROUND 2 GRANT AWARDS

N E W PA R T N E R S

The Children’s Foundation is the largest funder dedicated solely to advancing the health and wellness of children and families in the state of Michigan and beyond. The Foundation continues to partner with like-minded organizations to advance their individual efforts with grant support. The grants fund projects in community benefit, research and educational pillars. In our second grant cycle for 2021, The Children’s Foundation added 13 new community organizations to its list of grantee partners. The Foundation has granted over $70 million since 2011 and currently has a total of 130 community partners across the state.

2021 PROGRAMS AWA R D E D

152

R O U N D

2 0 2 1

N E W

C O M M U N I T Y

P A R T N E R S

2 0 2 1 A M O U N T TO DAT E

$5,994,056 For more information on how to get involved or to donate, please visit YourChildrensFoundation.org

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 15

COMMENTARY

‘Whack-a-mole’ isn’t working to keep lakes clean Y

mistake them for food, and to ou might not imagine a trash humans, too. Microplastics have cleanup as a joyous occasion. been found in drinking water, But the Alliance for the bottled water and beer, and it’s Great Lakes’ Adopt-a-Beach events estimated that we each ingest about are filled with fun and laughter, built a credit card-sized amount of plastic on a shared vision of a clean, healthy each week. Great Lakes region for all to enjoy. Volunteer cleanups alone cannot Each year, about 15,000 volunteers solve the Great Lakes plastic from all walks of life join one of over pollution problem. While Adopt-a1,000 beach cleanup events held Beach volunteers pick up about across all five Great Lakes and all Jennifer Caddick is 50,000 pounds of litter each year, that eight Great Lakes states. vice president of pales in comparison with the Adopt-a-Beach volunteers do more communications estimated 22 million pounds of than just clean up beaches and keep and engagement at plastic that enter the Great Lakes litter out of the lakes. They also collect the Chicago-based data. Alliance for the Great annually, contaminating the ecosystem and a key drinking water Every item picked up, from Lakes. source for 40 million Americans and cigarette butts to single-use water Canadians. bottles and bits of plastic foam containers, is And yet despite the scope of the problem, meticulously tallied by volunteers and entered reducing plastic is frequently dismissed as a into our online database. And that’s when things “feel-good” issue. get interesting. We tend to get preoccupied, focusing solely on This data represents a powerful snapshot of eliminating the “bad guy” of the moment—for a exactly what kind of litter ends up in our lakes. while it was plastic bags and then balloons. Year after year, the numbers are roughly the While these are noble efforts and come from a same: Approximately 85 percent of the trash cleaned up by Adopt-a-Beach volunteers is made positive desire to limit the amount of plastic being produced before it can even enter the up wholly, or in part, of plastic. The insidious thing about plastic is that it never waste stream, this approach puts us in “whack-amole” mode. really goes away. And that’s not a particularly effective strategy Sun, waves and other environmental factors will only break down plastic left on the beach into when you think about the thousands of different plastic items we use each day. The responsibility smaller and smaller pieces. for reducing plastic should be placed on the These microplastics are often invisible but are manufacturers, not individuals or end-user a clear and present danger to wildlife, which

industries like restaurants. To make sure our Great Lakes stay healthy, we need holistic policy solutions—and we’re starting to see a trend in this direction. The Canadian government has banned many single-use plastics, focusing on those most frequently found in the environment and the least recyclable items, with the policy expected to go into effect in late 2021. While not perfect, it is an important start. To be clear, expecting a complete end to all plastic use is not realistic. The COVID-19 pandemic showed the critical importance of plastic in health care, for example, with disposable gloves, gowns, masks and other medical-use plastics playing a crucial role in keeping health

care workers safe and allowing them to provide life-saving care. However, single-use plastics used for food and packaging are a major source of lake pollution, and cutting them across the board can make a significant dent in the plastic problem. Reducing plastic pollution is not easy. We need creative thinking and a diversity of voices in the policy-making conversation. Statewide bills that prevent local governments from taking action—“bans on bans”—in states like Michigan, Ohio and Wisconsin for example, are counterproductive. Blocking local governments from acting while failing to provide holistic solutions at the state level is the equivalent of continuing to let plastic flow into our Great Lakes.

Th inno The pers start othe purs fede illeg plas prod Th clea alon of go to st

disposal of their products, saving the government an estimated $156 million annually. We in Chicago and Illinois can and should follow these examples and start to advance similar public policies today. Other opportunities to tackle plastic pollution are in the hands of Congress. In the coming weeks, the Senate will take up critical water infrastructure legislation. The House of Representatives recently passed the INVEST in America Act, which includes a package of measures to help keep our waterways healthy. Especially important is the inclusion of Durbin’s Plastic Pellet Free Waters Act, which prohibits the discharge of plastic pellets and

othe facil tran She W lead mic and F deli sign vati Aqu our It tivel

COMMENTARY

Hold plastic producers responsible G ed, causing unforeseen health issues reat Lakes neighbors must for aquatic animals and humans get behind U.S. Sen. Dick alike. The manufacturing of plastic Durbin of Illinois and those goods is also a major problem. states that have taken the lead on Preproduction plastic pellets are adopting future-focused solutions. the foundation of plastic materials. A growing body of research tells There are no repercussions to us that plastic pollution impacts us all. But if we shift our approach to manufacturers or transporters when those pellets leak into our waterways. this global crisis from reactive to proactive, we can make a lasting A study published in December revealed that 42 of 66 beaches impact. To do so, we must adopt Andrea Densham across Great Lakes shorelines future-focused solutions that is senior director of contain these pea-size pellets. prevent plastic pollution entirely— government affairs At Shedd Aquarium, we see from production through the entire and conservation plastic pellets—and many other supply chain. policy at Shedd types of plastic pollution—firstAt least 22 million pounds of Aquarium in plastic enter the Great Lakes every Chicago. hand on Chicago’s beaches as we year, and our plastic reliance only work with local volunteers to clean increased during the COVID-19 pandemic. up our shorelines. This increase is costly on many fronts. But picking up litter on beaches and on the Food packaging alone, according to a new river is a reactive response to the issue. We report, costs the food-service industry an must simultaneously pursue forward-thinking estimated $24 billion annually. An additional and cost-effective solutions to prevent plastic $6 billion is then spent on waste management pollution in the first place. to get rid of this disposable plastic. As a founding member of the Aquarium It is also costly to our health. As plastic items Conservation Partnership, Shedd Aquarium make their way into waterways, they break down and 24 other aquariums across the country into microplastics—tiny plastic bits that slip into have eliminated more than 1 million plastic our drinking water and the food chain undetectbeverage bottles and counting from our 16 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

operations as well as reducing single-use plastic packaging wherever possible. We are proof positive that the business model works, and we aren’t the only example. Businesses and city governments across the U.S. have saved $5 billion from avoiding disposables and created 193,000 jobs within the new reuse economy, and restaurants in the Chicago community are actively pursuing plastic solutions through our Let’s Shedd Plastic program. We agree with the city of Chicago’s Waste Strategy report that the most impactful pollution prevention strategies are those that look upstream and encourage source reduction. Smart plastic prevention policies are already moving in cities and states across the country. Virginia’s governor recently signed an executive order to discontinue state agencies from buying, selling or distributing single-use plastic items, while investing in the development of a statewide plastic pollution reduction plan. States like Maine are advancing science-driven extended producer responsibility, or EPR, policies, which ensure plastic producers are responsible for pollution they create. In fact, our Great Lakes neighbors in Ontario recently updated their EPR program, which is funded by manufacturers for the proper end-of-life

and n, a

need he

nts s le, istic

kes.

he al

ch d

You can’t brew good beer without good water

A volunteer picks up trash on a Lake Michigan beach in Chicago.

LLOYD DEGRANE/ALLIANCE FOR THE GREAT LAKES

The Great Lakes region has been home to innovative pollution reduction ideas before. The movement to ban plastic microbeads in personal care products like face washes started with a statewide ban in Illinois, and other Great Lakes states subsequently pursued similar legislation. This pushed federal governments to act, and it is now illegal in the U.S. and Canada to include plastic microbeads in personal care products. The Alliance’s volunteers will keep cleaning our beaches, but they can’t go it alone: We need elected officials at all levels of government to step up and do their part to stop plastic pollution at the source.

Microplastics in our Great Lakes ur Great Lakes face a have been detected at high growing number of threats concentration levels. According to that demand urgent action a recent survey by the U.S. from all of us fortunate enough to Geological Survey, microplastics live in this part of the world. have been recorded at 112,000 As a business owner who relies particles per square mile of Great on the purity of Great Lakes water Lakes water. by turning it — and hops, malts Recently, to address our own and other ingredients grown right plastic management, Bell’s worked here in Michigan — into craft with other breweries to secure a brews, I take the sustainability of Larry Bell is the grant to purchase two balers that our business practices seriously. founder and allows us to begin recycling bags Whether it’s making energy-effi- president of Bell’s made of woven polypropylene that Brewery and ciency improvements or new co-chair of the Great are used for brewing grains like endeavors to address microplasbarley and other ingredients that Lakes Business tics, Bell’s Brewery works hard to come in large quantities. Network. minimize our impact on the Great These bags and what are called Lakes. “super sacks” are essentially bulk bags that And as a co-chair of the Great Lakes can hold upward of 3,000 pounds. While they Business Network—a coalition of businesses are technically recyclable, there wasn’t access that advocate for Great Lakes protection—I to a viable recycling outlet until now. know myself and fellow members are invested Truckloads of these bags are needed to in addressing our water infrastructure issues make it worthwhile for a recycling company and making the necessary improvements to to take them on. Even though we are a larger ensure pollution, especially plastic pollution, brewery, Bell’s wasn’t generating enough doesn’t reach our waterways. used bags on our own. One issue of concern is the amount of The balers purchased with the grant for our plastic that is inadvertently released into the brewery and others allow us to use it for Great Lakes, degrading into small pieces transport, and finished bales are processed called “microplastics” that accumulate in the through a partnership with Padnos in Grand food chain and wreak havoc on natural Rapids and their Kalamazoo partner AJ’s systems.

Recycling Services. Because of our commitment to sustainability, we worked with other breweries to secure this grant, which we are proud to say will reduce the amount of plastics being discarded in our state. We also know it takes more than individual actions of a few businesses to keep our lakes clean. It also takes smart policies at the local, state and federal level to ensure we’re all doing our part. The good news is there are solutions to ensure that microplastics don’t result in a catastrophe for our Great Lakes. The Great Lakes Business Network supports policies that will keep more plastics out of our freshwater ecosystem as well as other policies to keep our lakes clean. There are many other infrastructure investments that are necessary to make changes that reduce or eliminate pollution entering our rivers, lakes and streams. Our Great Lakes are only as great as they can be when we work together to protect them. The Great Lakes Business Network engages in advocacy on several fronts—from mitigating harmful algal blooms, to advancing clean energy opportunities and shuttering Enbridge’s Line 5 oil pipeline—and we look forward to continuing our leadership from an economic perspective as we engage on the issue of microplastics.

COMMENTARY

‘Bans on bans’ aren’t helping things

GETTY IMAGES

COMMENTARY

other preproduction plastic materials from facilities that make, use, package or transport those materials—a solution that Shedd Aquarium is working to advance. We are calling on individuals, business leaders and policymakers to help us prevent microplastics, preproduction plastic pellets and all other forms of plastic pollution. For action items and climate solutions delivered right to your inbox, consider signing up for Surge, a new digital conservation community created by Shedd Aquarium to mobilize the public to protect our shared planet. It’s the direction we must head in collectively today, and there is no time to waste.

down; it just gets legislation running through the Legislature ore than a smaller, so small that this term. month into these tiny particles can We can be leaders again by looking at new summer, pass through wastewa- policies like: thousands of people continue to visit Great ter treatment and ` Responsibly upgrading our waste and Lakes beaches, dunes, water filtration drinking water treatment systems to treat and inland lakes and our technologies. Scienfilter a variety of contaminants. majestic rivers. tists have documented Home to more than microplastics in Great ` Building protections into consumer 20 percent of the Lakes-area beer, products, such as microfiber filters on world’s fresh water, our Sean Hammond (left) is policy director at the drinking water and sea washing machines; designing products for Great Lakes are part of Michigan Environmental Council. Nicholas salt. permanent reuse in a circular economy; and who we are in Litter and microOcchipinti is director of government affairs at extending producer responsibility. (An Michigan. the Michigan League of Conservation Voters. plastics do more than example of this is legislation recently signed Our enjoyment of threaten the beauty of into law in Maine that holds producers the lakes and our water is what drives us to do our Great Lakes. They also have impacts on responsible for plastic pollution.) our day jobs for the Michigan Environmental the wildlife. Council and Michigan League of ConservaThese plastics are persistent in the `Letting communities lead by removing environment, and when they make their way tion Voters, working with stakeholders and restrictions on local governments from leading, into the ecosystem, they also end up in the lawmakers to develop policies that ensure we fish we eat and the water we drink. Microplas- experimenting and tackling issues on their put laws in place that ensure we have safe, clean drinking water, preserve our land and tics pollution is a Great Lakes issue protect our Great Lakes. and a potential health issue that PLASTIC POLLUTION MUST BE ADDRESSED One issue that has been less noticed is demands more study. microplastics pollution. While common litter Researchers should continue BY OUR LEADERS. on our beaches is visible and obvious—like learning how plastics both absorb plastic water bottles, cigarette filters and chemicals from the environment own—policies like the ban on plastic bag bans. balloons—another, much smaller form of and release them upon ingestion; the work is Protecting our Great Lakes is not only pollution called microplastics might be even needed for the whole range of plastics, from about stopping oil spills, reducing runoff that more problematic. beads and fragments to plastic fibers. causes toxic algae blooms and reducing Microplastics are small plastic pieces less Beyond research, what can be done? contaminants from flowing into our waters. than 5 millimeters in size, some so small they We know the scale of plastic pollution in Plastic pollution is a growing problem that are invisible to the naked eye. They come the Great Lakes is bigger than the individual must be addressed by our leaders. from a variety of sources, including synthetic person or a single governmental unit, and it We proved it could be done in 2015, when fibers, marine debris and larger pieces of will take more than volunteer cleanup states led and the federal government land-based litter. Researchers estimate some strategies to seriously address the issue. followed with the banning of microbeads. 11,000 tons of plastic pollution enters the Michigan has led on this issue in the Now, we must take on the whole plastics Great Lakes each year. past—tackling pollution through the Bottle issue, from milk jugs to microfibers. Unfortunately, plastic doesn’t readily break Bill 40 years ago and with the new recycling AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 17

Continued from Page 13

Stormwater runoff, treated sewage sludge and effluent from wastewater treatment plants channel them into tributaries that, in turn, feed them into the lakes, where water circulation patterns move them around. Some particles get deposited into lake sediment. Waves move particles to the shore, where winds can disperse them onto land, including onto coastal sand dunes. “It’s inescapable that things are getting worse,” said Sherri Mason, who as a chemistry professor at State University of New York at Fredonia, sampled water in all five Great Lakes. Fish studies and cores of lake sediment show an “exponential increase in the amount of microparticles” compared with before 1950, said Mason, who is now the sustainability coordinator at Penn State Behrend. The COVID-19 pandemic has worsened the problem due to the disposal of plastic gloves, plastic masks and takeout meals packaged in foam plastic, according to Mason, who said that under such dire circumstances, “all of the concerns about plastic pollution go out the window.” Microplastics are appearing in a disturbingly wide range of places in the Great Lakes Basin.

Many sources of pollution Lake Michigan has more plastic debris than any of the other Great Lakes, and its west-to-east water currents bring much of the waste eastward from the Chicago area to the lake’s Michigan coast. That’s nothing new. In 1988, for example, officials closed six public beaches in West Michigan for health reasons as syringes, pill bottles and other plastic materials washed ashore. For the past 26 years, the Ludington-based educational environmental group AFFEW (A Few Friends for the Environment of the World) has conducted beach sweeps three or four times annually, including one on May 19 that drew about 25 volunteers to the city’s Stearns Park. “There was lots of plastic,” said AFFEW President Julia Chambers, including cigarette filters, disposable diapers and Band-Aids. In recent years, cigar tips have become more common, while plastic-film balloons have become less com-

about 10,000 tons of plastic enter the lakes annually. On Lake Erie alone, hundreds of tons of plastic end up on the surface and hundreds more tons end up on the bottom each year, according to Hoffman. Currents in Lake Ontario tend to move west to east and north to south, and that has international implications because plastic waste from Toronto, one of the region’s largest cities, can move across the lake into U.S. waters. “It emphasizes the policy importance of considering things across state or international lines,” Hoffman said. Tiny tributaries contribute to the contamination, as Paul Steen, a Huron River Watershed Council ecologist, discovered in monitoring creeks that aren’t connected with wastewater treatment plants. The watershed covers more than 900 square miles in parts of seven Southeast Michigan counties. “Even these little creeks, 10 feet wide and less than a foot deep, through Ann Arbor in particular, had a ton of microplastics in them,” Steen said. Possible sources are plastic in dust that washes from city streets into the creeks, staying there until major rainstorms speed up the velocity of the water, which “rushes out in pulses” and sends the particles downstream to the Huron River, which empties into Lake Erie, according to Steen.

Birds, brews and dunes

So what about your craft beer? Mason and other researchers tested 12 brands of beer, primarily pilsners, brewed with water that nine municipalities draw from the Great Lakes. The team also tested water from seven of those municipalities—Holland and Alpena, Mich.; Chicago and Glenview, Ill.; Duluth, Minn.; and Clayton and Buffalo, N.Y.—as well as water from Cleveland and the Rochester, N.Y., vicinity. They found plastic fibers and fragments in all dozen of those brews and in 81 percent of the tap water samples. “The concern is we’re polluting our drinking water with plastics,” said Jennifer Caddick, vice president of communication and engagement at the Chicago-based advoLAKE MICHIGAN HAS MORE PLASTIC DEBRIS cacy group Alliance for the THAN ANY OF THE OTHER GREAT LAKES. Great Lakes. Kris Spauldmon, possibly because of increased ing, president of Brewery Vivant in public awareness that they’re a plas- Grand Rapids, is increasingly mindful of microplastics getting into the tic pollution source. “Over the past couple of years, farmhouse ales and Belgian witbiers there’s been a lot more debris be- her brewery makes using water from cause of higher water levels eating the Grand Rapids municipal system, away at the foredune,” said Jim Gal- which draws it from Lake Michigan. “I believe it’s a big problem for all lie, superintendent of Ludington State Park. “The rising water is ex- of us, whatever you’re drinking,” posing a lot of older plastic objects Spaulding said. “(The researchers) that had been buried in sand for could have picked any beverage.” As for the impact on fish, scienyears, even decades.” Matt Hoffman, an associate pro- tists from Loyola University Chicago fessor in the College of Science at and SUNY Fredonia found microRochester Institute of Technology, plastics in a variety of species from and an RIT colleague model Great the Muskegon and St. Joseph rivers Lakes currents, estimating that in Southwest Michigan and from 18 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

PLASTICS

A plastic balloon, found on a Lake Huron beach near Alpena, is a common form of plastic pollution on the Great Lakes.

Wis emp M an F rese Anis Min that may Sup you may “M nan crop rout that hum mat com tion prov add plas nolo mov from

CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

Wisconsin’s Milwaukee River that empty into Lake Michigan. Meanwhile, the Great Lakes Indian Fish & Wildlife Commission, representing 11 federally recognized Anishinaabe tribes in Michigan, Minnesota and Wisconsin, warns that microplastic contamination may contribute to declining Lake Superior fish populations because young fish and species such as cisco may mistake the particles for food. “Many environmental contaminants adhere to the surface of microplastics, creating an exposure route for these chemicals to the fish that consume them, as well as the humans and wildlife that may ultimately consume those fish,” the commission said in a 2020 resolution urging tribal, federal, state and provincial governments to support additional research, restrict use of plastic materials and invest in technology to “prevent and safely remove microplastic contamination from the Great Lakes.”

Birds are adversely affected as well. To illustrate, University of Toronto scientists have reported microplastics in the bellies of double-crested cormorant chicks in lakes Erie and Ontario. That debris, they write, “may have negative effects on the physiology, growth, development and, potentially, the behavior of these birds.” How did the microplastics get into the chicks’ digestive system? In regurgitated fish fed them by their parents. Among other Great Lakes Basin birds, plastic debris has been found in the diets of Lake Ontario and Hamilton Harbor herring gulls and in the gastrointestinal tracts of St. Lawrence River ring-billed gulls. On land, the first North American study of microplastics in coastal dunes, carried out by researchers at SUNY Oneonta, found plastic pellets, fragments and fibers at sites along the southern and eastern shores of Lake Erie and Lake Ontario.

“That was a bit of a surprise to us,” said James Ebert, a study co-author and geology professor at SUNY Oneonta. His students found lots of small particles on the beach and thought, “If we found them on the beach, they were probably getting into the dunes.” They were indeed. Some ended up in dunes as far as half a football field from the shore, according to Ebert. His study said, “Once in the coastal dune environment, microplastics accumulate in the sediment and it is likely that some are transported farther inland.”

Lack of research Despite rising public and government concern, there’s been far less research about microplastics in the Great Lakes—the world’s largest source of drinking water—than in the oceans. The first peer-reviewed study of plastics in the Great Lakes didn’t ap-

JIM BODENSTAB

STEPHEN J. SERIO FOR CRAIN’S CHICAGO BUSINESS

A beachgoer discards a plastic bottle in a recycling bin June 6 at Silver Beach County Park on Lake Michigan in St. Joseph, Mich.

A fish with a plastic ring snared around the midsection of its belly and spine was caught in 2011 on Lake Ontario’s Mexico Bay, 40 miles north of Syracuse, N.Y.

pear until 2011. In the decade since then, fewer than 10 peer-reviewed scientific studies about their effects on fish, mussels, birds and other wildlife have been published. And so far, there have been no peer-reviewed studies of the effects of Great Lakes microplastics on the human body, according to Mason, the water sampling expert. Experts are calling for more research funding to answer crucial questions, including how plastic biodegrades in freshwater systems and how it affects human health. Among the other mysteries in need of exploration are differences in impact based on the chemical makeup, size and shape of plastic particles. Hoffman, who studies water currents, says governments can benefit from a better understanding of potential risks and how different polymers from different sources move differently in the water. For Ebert, the geologist, the next step in his sand dunes work is ana-

lyzing the results of lab experiments to determine the relationship between particles’ size and the amount of wind necessary to move them. Mason points to the scarcity of studies about the impact on wildlife, saying, “It’s a knowledge gap area. What is in our organisms?” There have been other studies showing microplastics showing up in human feces as well as human placentas, meaning microscopic fragments of plastics are passing from a mother to her developing fetus, Mason said. “We don’t know the ramifications of this on human health,” Mason said. “That’s kind of the front end of this research, understanding what does this mean? Is there some safe level of ingestion? We don’t know.” Eric Freedman is a Pulitzer Prizewinning journalism professor and director of the Knight Center for Environmental Journalism at Michigan State University. AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 19

How consumer brands are battling their plastic waste problem Shareholder activists turn up the heat on household names for packaging choices BY ALLISON NICOLE SMITH

The proliferation of plastic waste that gets dumped into the oceans each year has intensified public and investor pressure on some of the biggest consumer brand-name companies in Michigan and Illinois to reduce their use of plastic. Ten major consumer brands and retailers, including Chicago-based McDonald’s Corp., Chicago-based Kraft Heinz Co. and Cincinnati-based Kroger Co., have been faced with resolutions from eco-minded shareholders to disclose how much of their plastic packaging goes into the environment and roll out detailed action plans to reduce plastic. Shareholder resolutions had to be withdrawn at McDonald’s and Kraft Heinz because of paperwork problems, Plastics News reported in June. But the message was received at Kraft Heinz (NASDAQ: KHC), one of the largest food and beverage makers in North American that uses plastic packaging for products that range from Heinz ketchup bottles to tubs of Philadelphia cream cheese. Jonah Smith, global head of environmental social governance for Kraft Heinz, told Crain’s that the resolution was tabled after the company disclosed its eco-friendly efforts so far and its sustainability goals for the future. “Those were all removed because (shareholders) felt confident in our ability to achieve what we were telling them,” Smith said. Kraft Heinz aims for 100 percent of its packaging to be reusable, recyclable or compostable by 2025; currently, that figure is around 80 percent, Smith said. The company recently unveiled fully recyclable caps for its ketchup bottles, an investment that cost $1.2 million. Smith declined to say how much Kraft Heinz is investing in plastic reduction or sustainability efforts overall. Most companies shy away from discussing their approach to plastic use and shareholder pressure. At Kroger’s June 24 annual meeting, 45 percent of shareholders voted in favor of a resolution demanding the grocery chain develop and disclose a plan to reduce its plastic use, despite urging from the company’s board to vote against the proposal, Plastics News reported. In a statement that accompanied its annual report, the supermarket giant detailed the steps it has already taken to combat the plastics crisis, such as its plan to phase out plastic bags by 2025. Kroger (NYSE: KR), along with its Walker, Mich.-based supermarket competitor Meijer and Deerfield, Ill.based pharmacy giant Walgreens (NASDAQ: WBA), has joined the Beyond the Bag initiative, an effort by 20 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

major retailers to reduce single-use shopping bag waste. McDonald’s, Walgreens, Kroger and Rosemont, Ill.-based US Foods either did not respond to or declined repeated requests for comment from Crain’s. According to As You Sow, one of the environmental groups behind the shareholder resolutions, McDonald’s used 53,000 metric tons of plastic in its packaging in 2018. Just 2 percent of its plastic footprint comes from recycled content, while the majority comes from single-use plastic beverage cups, lids and utensils. Although most companies say they are concerned about plastic waste and are implementing initiatives to reduce it, Reuters found the plastics industry plans to spend $400 billion on new plastic and less than $2 billion on reducing plastic waste. Of the companies Crain’s surveyed, most touted waste collection and diversion efforts. In addition to waste diversion, Meijer said it prides itself on its green infrastructure, including permeable pavers and bioswales, which helps infiltrate stormwater and filter out pollutants, such as microplastics, before the water is discharged back into the Great Lakes. For the Great Lakes, annual plastics pollution is estimated at 11,000 tons — a fraction of the estimated 11 million tons of plastic waste that pollute the world’s oceans every year, according to a study published last summer by Pew Charitable Trusts, an independent public interest group. In 2020, Meijer said it collected more than 6 million pounds — or 3,000 tons — of plastic film for recycling. Erik Petrovskis, director of environmental compliance and sustainability for Meijer, declined to say what percentage of the company’s packaging is currently recyclable but noted the company is “on track” to meet its target of all bakery, deli and brand packaging being 100 percent recyclable by 2025. Today, about 95 percent of bakery and deli containers are recyclable, he said. “When it comes to food packaging, plastic can play an important role in reducing food waste and keeping food safe,” Petrovskis said. SpartanNash Co. (NASDAQ: SPTN), the Grand Rapids-based supermarket chain whose brands include Family Fare and D&W Fresh Market, did not respond to specific questions. But in a statement to Crain’s, the company said it had recycled 3.9 million pounds of plastic in 2020. “We are continuously evaluating new ways to keep as much plastic out of our landfills as possible,” said Adrienne Chance, SpartanNash’s vice president of communications. Consumer brands and retailers including Kraft Heinz, Meijer and Post

Chicago-based Kraft Heinz Co. recently unveiled fully recyclable caps for its iconic Heinz tomato ketchup. | KRAFT HEINZ

Battle Creek-based cereal giant Kellogg Co. has reduced the plastic in its cereal bags by 17 percent, amounting to 1 million pounds of less plastic used annually. | BLOOMBERG

Holdings Inc. said they are working to make their packaging recyclable or reusable. While the pandemic did not directly affect any of those targets, Petrovskis said, it did impact the company’s single-use plastic usage, as Meijer stores did not allow reusable bags for health and safety reasons. Post Holdings (NYSE: POST), the St. Louis-based cereal maker that has a plant in Battle Creek, Mich., has cut its annual use of plastic film in cereal bags by 1 million pounds, said Maureen Mazurek, head of environmental social governance for Post. Similarly, Post’s crosstown rival, Battle Creek-based Kellogg Co. (NYSE: K), has reduced the packaging of its cereal bags by 17 percent, amounting to 1 million pounds of plastic. Currently, 76 percent of Kellogg's packaging materials are recyclable, and the company has the same 2025 goal as Kraft Heinz of having completely sustainable packaging. Although plastic manufacturers have typically left public-facing sustainability efforts to retailers and consumer brands, producers of polymers, the petrochemicals that make up single-use plastic, are increasingly speaking up to defend their environmentalism records. Midland, Mich.-based chemicals giant Dow Inc. (NYSE: DOW), which is one of the biggest producers of single-use plastic, according to a new report, announced environmental targets for itself last year: eliminating 1 million metric tons of plastic waste by 2030, implementing 100 percent reusable or recyclable packaging by 2035

and going carbon-neutral by 2050. Dow’s global sustainability director, Haley Lowry, declined to say how much the company is investing in plastic reduction or sustainability efforts overall. Dart Container Corp., the world’s largest manufacturer of foam cups and containers, as well as the maker of Solo cups, cited some of its environmentalism measures underway in a statement to Crain’s, such as the privately owned company’s $18 million investment in the recycling of polystyrene, the plastic foam synonymous with Dart cups. Most companies surveyed by Crain’s said plastic can still be a sustainable choice. Dow and Kraft Heinz also said they are investing in new technologies to reuse plastic. The problem is not with plastic itself, but rather the widespread misuse of it, said Smith, who argued a holistic life-cycle analysis is needed to determine a material’s overall environmental impact. “Plastics have approximately four times less environmental cost—particularly when it comes to carbon emissions — compared to other materials,” said Lowry, who cited a study from Trucost, an independent environmental research group. This report was commissioned by the American Chemistry Council, a trade group that represents oil and chemical companies such as Dow that manufacture plastic resins. “Plus, they offer a more affordable and healthier quality of life for billions of people,” Lowry added. Lowry panned efforts by state legislatures and municipalities such as

Chicago to curb certain types of waste through new laws and ordinances, such as proposed bans on plastic grocery bags, foam cups and drinking straws. “Bans don’t address human behavior related to waste management or significantly reduce the amount of debris in the environment,” Lowry said. “There are far more impactful ways to address plastic waste in the environment, like improving waste collection and recycling.” Dart’s signature foam products, which have been known to harm aquatic life, have been the subject of recent municipal and statewide bans. “We advocate for and support legislation calling for reasonable, achievable, material-neutral recovery rates and public-private funding mandates to build a nationwide network of recovery and composting facilities to process post-consumer materials of all kinds,” said Michael Westerfield, Dart’s corporate director of recycling programs. In addition, he cited the company’s marine debris prevention initiatives, including $100,000 in grants to cities and organizations to install stormwater management products. Rather than eliminate plastic outright, most companies have focused their corporate sustainability efforts on education campaigns to improve public awareness of recycling and waste reduction. “There is widespread confusion around proper disposal of biodegradable plastics, so Meijer is focused instead on improving the recyclability of plastics and educating customers on proper recycling,” Petrovskis said. As part of the Sustainable Packaging Coalition, Meijer has pledged to affix recycling instructions to all of the packaging of its True Goodness brand foods by 2022. Kraft Heinz, Walgreens, McDonald’s, Kroger, Kellogg and Post also are members of Sustainable Packaging Coalition. Dow launched a podcast series this year called Plastics Unwrapped, which features industry innovations in recyclable plastics. All players in the industry, from consumer brands to manufacturers to municipalities, must accept a “shared responsibility” in the effort to solve the environmental crisis, Kraft Heinz’s Smith said. “None of us are perfect,” Smith said. “No company is perfect. But let’s all do what we can and play a role.”

SPONSORED CONTENT

CARING FOR KIDS Advocating for the health of children and their families

Advocating for the health & wellness of children and families

About this report: On this monthly radio program, The Children’s Foundation President and CEO Larry Burns talks to community, government and business leaders about issues related to children’s health and wellness. This hour-long show typically airs at 7 p.m. the fourth Tuesday of each month on WJR 760AM. Here’s a summary of the show that aired July 27; listen to the entire episode, and archived episodes, at yourchildrensfoundation.org/caring-for-kids.

Chuck Bullock, Board Member, The Children’s Foundation and First Tee-Greater Detroit Larry Burns: Give us an update on our work with The Children’s Foundation. Chuck Bullock: Our new grants have been announced recently, and we’ve awarded 57 grants totaling $1.67 million and supported 12 new community partners. This brings our 2021 grant total to nearly $6 million and our community partners to 130. Some examples of our new grants are Wayne State University, for research focused on the use of virtual reality and pediatric neurosurgery patient experiences; Kids On the Go, for programming at several camps that address the health and fitness of children with special needs; and Inclusively Fit, which is a program that will create individual workout plans for youth with disabilities, both at a fitness center and in their homes. Burns: What else is going on this summer with The Children’s Foundation? Bullock: The 18th Annual Paul W. Smith Golf Classic is taking place on Aug. 2 and it supports four charities: Detroit PAL, Variety Detroit, the Children’s Center and The Children’s Foundation. We have already surpassed last year’s amount of sponsorship so hopefully this outing will be a record-breaking year. Burns: You’re a founding trustee for First Tee-Greater Detroit. Tell us about the program. Bullock: We are now active at six locations, including new programs at Chandler Park on Belle Isle. We have 63 coaches that are serving as mentors for youth. We’re partnering with community organizations like Detroit PAL, Life Remodeled and Buildup STEAM. We had a visible presence at the Rocket Mortgage Classic. We were involved with the kids’ clinic, along with Midnight Golf, Detroit PAL and other nonprofits. We were also able to get Webb Simpson and Brendon Todd to hold a putting clinic for the First Tee kids. The Children’s Foundation was a recipient of a generous $100,000 gift from Phil and Amy Mickelson. Burns: First Tee-Greater Detroit is partnering with the Ben Hogan Foundation from Fort Worth, Texas on a golf outing on Aug. 9. Tell us about that. Bullock: This is our first community fundraising event and Rocket Mortgage is our presenting sponsor. We’re delighted to welcome new sponsors as well, and we have some great opportunities. To find out more about sponsorships, visit firstteegreaterdetroit.org/events. It’s different from many outings because it’s not a scramble: it’s a two-person best-ball tournament. The reason is that Ben Hogan followed golf to a tee, and the foundation feels that a best-ball tournament is more of what Ben Hogan would like to do versus a scramble. So, everybody gets to play their ball. It should be a great day for a great cause.

Lorem ipsum

Host Larry Burns, President and CEO, The Children’s Foundation

Doug North, Chairman, 2021 North American International Auto Show

Kevin O’Neal, Board Member, Boys & Girls Clubs of Toledo

Larry Burns: Can you give us an overview of things to come for the Auto Show?

Larry Burns: Tell us about the Solheim Cup.

Doug North: We’re hosting two events this summer. The Motor City Car Crawl Aug. 5-8 is taking place in all six downtown parks, including Beacon Park, Cadillac Square, Campus Martius, Capitol Park, Grand Circus Park and Spirit Plaza. Produced by the Detroit Auto Dealers Association (DADA) and the Downtown Detroit Partnership (DDP), the event will showcase new vehicles from metro Detroit area dealers. There will also be local food trucks, beverage stations and family entertainment. Motor Bella takes place Sept. 21-26. That will be a dynamic and interactive event taking place on the 87-acre M1 Concourse in Pontiac. There’s a 1.5-mile track, and you’re going to see all sorts of moving and dynamic vehicles — electric vehicles, autonomous vehicles, high-performance vehicles, off-road vehicles and an opportunity to ride in all of those. Over 600 cars, trucks and utility vehicles will be there. Tickets are available now on the North American International Auto Show website. Between those two events, the public will have eight days to get involved in both downtown and in Pontiac. These are all outdoor events conducted in a safe and comfortable environment. They’re ideal for families. Burns: Can you tell us about the Charity Gala? North: Singer-songwriter and nine-time Grammy Award winner Sheryl Crow headlines the Charity Gala the evening of Aug. 7 at Campus Martius. It is a ticketed event. Tickets are available now at YourChildrensFoundation.org/mc3. Parc in Campus Martius will be catering strolling appetizers and cocktails. That event is our effort to continue the tradition of our Charity Preview. Our hope is that we can sell hundreds, if not thousands, of tickets to generate a great deal of dollars for our nine Detroit children’s charities, including The Children’s Foundation, as well as Boys & Girls Clubs of Southeastern Michigan, Boys Hope Girls Hope of Detroit, The Children’s Center, Detroit PAL, Judson Center, March of Dimes Metro Detroit, University of Michigan C.S. Mott Children’s Hospital and Detroit Auto Dealers Association Charitable Foundation Fund, a fund of the Community Foundation for Southeast Michigan. It will be a great evening. It’ll be fun for everyone to gather in their summer chic attire and help support those charities we’re committed to. Burns: Talking about the car industry, any developments that you find exciting? North: Some of the new products that are so darn exciting for us in the Ford world are the all-electric Mach-E Mustang and the new full-size Bronco. We’ve got a new hybrid Maverick compact pickup coming, and we’ve got the new F-150 Lightning all-electric pickup. It’s a lot of new technology that is a huge leap from where we previously were. I think the consumers are going to love seeing them and driving them with these new and sophisticated powertrains. The demand is there; people are still in need of cars and the used car business has really been robust.

Kevin O’Neal: The Solheim Cup is the largest international event in women’s golf. Plans have been in the works for several years including building the infrastructure out at The Inverness Club. We’ve built bleachers and hospitality tents all over the course. The tournament will run from Aug. 31-Sept. 5 with the competition being from Sept. 3-5. This is our first time hosting the Solheim Cup. All of the opening festivities will take place downtown, including musical act Gwen Stefani. In terms of the city of Toledo, it’s about a $30 million to $35 million impact to the city. It is the goal of the event to have 150,000 people through the gates through the week. There still are volunteer opportunities for the Solheim Cup. For more information or to buy tickets, visit solheimcupusa.com. Burns: Tell us about First Tee Lake Erie and how it came together. O’Neal: The beginnings of this project started about six years ago when the First Tee of Lake Erie started brainstorming about having their own facility, as opposed to moving around to different courses in practice. A partnership was created with the First Tee of Lake Erie, Inverness Club, ProMedica, and The Boys and Girls Club. A facility was built on the property that Inverness Club owns, but they needed a partner to occupy it and offer additional programming. That’s where we came in. With this new location, The Boys and Girls Club will be in all five Toledo public school districts and service an additional 1,800 kids. Burns: How have you orchestrated the fundraising for this? O’Neal: We started a campaign called Growing Futures Together with our partners. Over a two- to three-year period, we raised the money for the building. Burns: Can you explain to us what that will be like eventually when it’s done? O’Neal: The majority of the inside of the building will be a typical Boys and Girls Club with afterschool program and rooms for education, technology, arts and crafts. There’s also a teen room and gymnasium. Out of the building, First Tee will run the majority of their programming with a 270-yard driving range and an 18-hole putting course. That’s Phase One. Phase Two will add a six-hole golf course. Burns: We thought so highly of your plans at The Children’s Foundation that we recently made a grant to be part of it. Some of our First Tee kids are going to come down and experience it. We hope someday to have our own First Tee facility. O’Neal: We’d like to thank The Children’s Foundation for your support and partnership. Burns: What else do you see in the future for Inverness? O’Neal: We’ll probably need a couple-year break because it is a lot of work. But down the road, we would love to continue to host events like the Solheim Cup and other major championships.

BIOTECH

Ann Arbor-based cancer testing company sets state biotech VC mark BY NICK MANES

Ann Arbor-based cancer testing and sequencing company Strata Oncology Inc. last week closed on the largest funding round for a biotech company in the state’s history, pushing it closer to a likely initial public offering. Strata on Wednesday announced a $90 million Series C funding round, likely the last round of private financing the company will raise, according to co-founder and CEO Dan Rhodes. The Series C round comes in ahead of the $77 million Series D round for Kalamazoo-based Ablative Solutions in 2019, but lags behind two larger rounds for Detroit-based e-commerce company StockX LLC, according to data provided to Crain’s by Entry-

Point, an Ann Arbor-based entrepreneurial research nonprofit. Rhodes, in an interview with Crain’s, said the funding will be used in a twofold manner: to take the company’s current cancer testing technology to market, while also allowing the Rhodes company to undertake new product development. The company's research aims to better identify biomarkers, or general indicators, of whether someone may or may not have cancer. Taken together, the Series C financing allows Strata Oncology “to really take take a big step in this field of cancer genomic testing and to step

into market leader status,” Rhodes said. “That’s our goal.” A valuation for the company was not disclosed, nor was a revenue figure, but this newest round of capital brings Strata’s total funding to more than $130 million, according to a news release. Strata Oncology employs about 85 people, with about half in the Ann Arbor area, but plans to grow to around 200 over the next year or so, according to Rhodes. The Series C round was led by investment firm Wellington Management Co. LLP out of Boston and other new investors included Monashee

PEOPLE ON THE MOVE

Investment Management and Highside Capital Management, according to the release. Existing investors who participated in the round included Pfizer Ventures, Merck Global Health Innovation Fund, Deerfield Management, Baird Capital, as well as Renaissance Venture Capital Fund and Arboretum Ventures, both based in Ann Arbor. The involvement of a large investment firm like Wellington — which declined comment for this report — with upward of a $1 trillion in assets under management, speaks to the appetite for investors that may typically operate in public markets willing to get into “crossover” deals for pre-IPO companies like Strata, ac-

cording to Rhodes. The CEO said he envisions the company going public, likely through a traditional public offering, by late 2022 or early 2023. “Companies with disruptive technology and very large market opportunities, I think, are winning the attention of investors,” Rhodes said. Strata Oncololgy earlier this year announced it had partnered with pharma giant Pfizer Inc. out of New York City to roll out the PATH trial, or Precision Indications for Approved Therapies. Terms of the deal were not disclosed, but plans call for the companies to study how existing cancer drugs can be used to better treat patients. Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

Advertising Section To place your listing, visit crainsdetroit.com/people-on-the-move or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

ACCOUNTING

AUTOMOTIVE

ENGINEERING / DESIGN

NONPROFIT

BDO USA, LLP

Lear Corporation

HNTB

Detroit PAL

BDO USA, LLP, one of the nation’s leading accounting and advisory firms, announced Matt Manosky has been named Tax Office Managing Partner for the Detroit market. Manosky will oversee the local tax practice in his new position and will continue providing both private and public companies assistance with various tax matters. He will continue to focus on complex, multi-national C-Corporations in many industries, including private equity, manufacturing and distribution, technology, and retail.

Lear Corporation, a global automotive technology leader in Seating and E-Systems, has appointed Alicia Davis as the company’s Chief Strategy Officer. She will lead a central strategy organization to drive enterprisewide strategic planning, largescale strategic initiatives, and value-enhancing M&A and early-stage automotive technology investment activity. Alicia joined Lear in 2018 and most recently served as Senior Vice President, Corporate Development and Investor Relations.

Regine Beauboeuf, PE, serves as Director of Infrastructure and Mobility Equity, responsible for supporting policy makers, community leaders and HNTB’s clients to address equity considerations, infrastructure planning, design, and construction. Beauboeuf has over 35 years of regional transportation and infrastructure experience specializing in large, complex, transportation projects. Most recently serving as Detroit office leader and program manager for the Innovate Mound project in Macomb.

Dave Langlois, PE, now serves as Associate Vice President and Design Group Director for HNTB Michigan. Langlois is a licensed professional engineer with over 20 years of experience on transportation infrastructure projects. He is a lead highway design engineer and project manager for some of the largest and most complex projects throughout Michigan. Langlois will be responsible for developing and growing a bridge design practice in Michigan and will continue to oversee highway designs.

At its recent board meeting, Detroit PAL announced the unanimous election of two new board members. They are: Detroit Pistons Director Hawkins of Executive Operations and Team Services, Jhonika Hawkins and Comerica Bank Vice President-District Manager, Marvin Rushing. The announcement was made by Detroit PAL Rushing Chief Executive Officer, Robert Jamerson.

ACCOUNTING

LAW

ENGINEERING / DESIGN

NONPROFIT

BDO USA, LLP

Reising Ethington P.C.

BDO USA, LLP, one of the nation’s leading accounting and advisory firms, today announced Andy Zaleski has been named Tax Market Leader for the Detroit market. Zaleski will be responsible for driving strategic growth for the local office and will continue to develop and lead federal tax planning initiatives for public and private multinational companies in a wide array of industries. Zaleski’s experience includes over 25 years of providing complex tax advice to multinational businesses.

Reising Ethington has named Shareholder Shannon Smith to the newly created position of Vice President of Diversity, Equity, and Inclusion. As the newest member of the firm’s Management Committee, Shannon’s mission is to establish programs and initiatives aimed at the promotion of all individuals through a comprehensive representation of a broader culture with the goal of delivering enhanced client service. Since its founding in 1865, the firm has specialized solely in Intellectual Property law.

HNTB

Detroit PAL

Victor Frendo is now Group Director of Construction Services at HNTB. Frendo has over 36 years of construction experience supporting departments of transportation, municipalities, and private sector clients. In his new role, he will lead HNTB’s construction engineering/inspection practice to meet the increasing demands of Michigan’s transportation construction industry. His primary focus is growing HNTB’s construction practice of Michigan’s largest and most complex transportation projects.

Karianne Steffen, PE, PTOE, is now Vice President and Planning and Mobility Group Director, responsible for leading a team of 25 planners and engineers throughout Michigan focusing on environmental planning, transit, traffic engineering, technology, intelligent transportation systems design and system management. Steffen has been with HNTB for nearly ten years, currently serving as project manager for the 12-mile long I-96 Flex Route project in Oakland County.

At its recent board meeting, Detroit PAL announced the unanimous election of a new board member, Detroit Public Television Marketing Manager, Nakia Mills. The Announcement was made by Detroit PAL Chief Executive Officer, Robert Jamerson.

22 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

TECHNOLOGY

AI startup Detect-It seeks to gain momentum in automotive sector BY NICK MANES

"Artificial intelligence" and "machine learning" may be buzzwords among corporate industrial executives, but an Oak Park startup sees opportunity to make them part of everyday workflow outside of the C-suite and right on the shop floor. Detect-It LLC, which formed late last year, now seeks to bring its proprietary artificial intelligence software technology to market, targeting predominately tier one automotive suppliers. The message the company hopes to convey, according to President and CEO Kevin Kerwin: Those companies are in the business of manufacturing auto parts, not coding. Absent an application like his Detect-It software called Net Builder, companies would need to develop their own AI code, Kerwin told Crain’s in an interview. “And that’s just a very arduous task, (that’s) very costly. So what needs to happen is we need to build a tool that anybody can use to generate smart, intelligent AI,” he said. “I wanted to abstract people from the code because they don’t need to see the code to do this. They need to have a tool that guides them through the process of doing it.”

company seeks to gain momentum. In April, the company was named one of 23 finalists from 20 countries for the PACE Awards, presented by Automotive News, also a Crain Communications publication. "This year's class of PACE finalists showcases the rich innovation underway worldwide in the business of moving people and things," Steve Schmith, director of Automotive News PACE Awards judging, said in a statement. "The finalists represent companies operating throughout the automotive value chain who are not only driving game-changing approaches to product development, but also reimagining the customer experience and creating new ways of generating revenue.” Schmith, in an email to Crain’s, declined to comment on Detect-It specifically.

Making their pitch

Up to this point, the formation of the company has been largely bootstrapped and done with capital from a previous company Kerwin helped to run. But Kerwin said he’s in the process of working to close a $5 million Series A venture capital fundraising round. He antici“WHAT THEY REALLY SEE IS pates more than $1 million THINGS THAT COULDN’T BE DONE in revenue by the end of this year and approaching $3 BEFORE CAN BE DONE EASILY.” million next year. — Kevin Kerwin, Detect-It Conversations with major auto suppliers are onRick DiLoreto, Detect-It’s direcgoing, he said. tor of marketing, put it this way: “What they really see is things “We’re really like the Microsoft Ofthat couldn't be done before that fice of AI.” can be done easily now and savings Despite its relatively recent forassociated with it,” Kerwin said of mation, Detect-It has already startthe value proposition being ed to garner some accolades within pitched to auto executives. the automotive sector, where the A particular use Kerwin sees for

the Net Builder software is the detection of scratches and other imperfections on surfaces, particularly plastic and other materials used in the production of vehicles. “Scratch detection on surfaces is always left up to people, because there is no system that you can really buy that understand what scratches are,” Kerwin said. “You can’t define scratches because it’s a scratch. It’s a mark. Trying to define that to software is really tough.” The Net Builder software developed by Detect-It, however, uses thousands of individual video frames of different surfaces and parts and then machine learning, over a period of hours, learns to detect the imperfections.

Lots of opportunities AI technology, at least in its current state, offers myriad opportunities and challenges for automotive and industrial companies, according to Tom Kelly, executive director and CEO of Automation Alley, a manufacturing advocacy group based in Troy. Because manufacturing processes are less than 100 percent accurate, having technology in place that can spot imperfections offers plenty of upside for manufacturers, Kelly said. The issue is that, broadly speaking, much of the technology tends to be “finicky” and is “almost ready for prime time,” Kelly said. The good news for a company like Detect-It, he noted, is that much of the manufacturing processes are highly repeatable, so technology that can accurately detect scratches or other imperfections could be warmly received. Kelly added that due to the rapidly changing pace of technology implementation, Automation Alley

AUTOMOTIVE

Former Delphi Tech CEO Richard Dauch to take helm at EV firm BY KURT NAGL

Longtime auto supply executive Richard Dauch will be the next CEO of electric vehicle company Workhorse Group. Dauch, who starts in his new job Aug. 2, replaces Duane Hughes, who was in the role 2 1/2 years, according to a news release. Dauch previously served as CEO of Delphi Technologies PLC, a Troybased powertrain company that was spun off from Delphi Automotive PLC along with Aptiv PLC in 2017. He guided Delphi Technologies (NYSE: DLPH) through an acquisition by BorgWarner Inc. that closed in October. Following the $3.2 billion deal, Dauch served as an adviser at BorgWarner for half a year. He steps into the top role at Loveland, Ohio-based Workhorse (NAS-

DAQ: WKHS) shortly after the company filed a legal challenge against the United States Postal Service for its multibillion-dollar deal with Oshkosh Defense to manufacture EVs for the federal agency’s fleet. Workhorse, which makes all-electric delivery vans, had been aiming to land business from the USPS. Dauch spent 13 years in various senior roles at Detroit-based American Axle & Manufacturing Inc., founded by his late father Dick Dauch. From there, Richard Dauch served as president and CEO at Acument Global Technologies for 2 1/2 years before serving the same role for Accuride Corp. “He is a strong executive with more than 25 years of industry experience, including 12 years serving in CEO roles with private and publicly traded companies,” Ray Chess, Non-Execu-

tive Chairman of Workhorse’s board of directors, said in the release. “Rick’s proven team leadership capabilities, industry expertise, customer focus and successful operational track record make him ideally suited to lead Workhorse into its next phase of operational ramp-up and growth during this dynamic industry shift to electric last mile delivery services.” Workhorse put its first electric van on the road in the beginning of the year with plans to manufacture 2,000 by the end of 2021. However, it dialed that back to just 1,000 vans, with a backlog of about 8,000, according to the company. Its shares plummeted by nearly half in February after the USPS awarded Oshkosh the EV contract. Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

Detect-It CEO Kevin Kerwin demonstrates some of the startup’s proprietary artificial intelligence software technology at its Oak Park facility. | DETECT-IT

is strongly encouraging members to engage companies like Detect-It. “Bring them in. If they're willing to sit down and say, ‘Hey, we'll come in and for 1,000 bucks or for free, we'll see if our camera and our AI technology can work,’” Kelly said. “That's a great calculus. I think all companies should be experimenting like that (and saying), ‘look what do I have to lose? I might actually learn something and it's not going to break the bank.’” The emergence of Detect-It makes for something of a second act for Kerwin, who prior to founding the AI company ran his family’s longtime company ARKK Engi-

neering Inc., headquartered in the same facility as Detect-It along West 11 Mile Road in Oak Park. Detect-It, he said, grew out a desire to start something small and scale over time. “When you're CEO of a big damn company you're not creating anything anymore. You're more or less managing chaos,” Kerwin said. “So the opportunity was right for me to sell ... I just wanted to do one last thing in my crescendo of my career and that was build something that truly will change our industry.” Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

Advertising Section

CLASSIFIEDS To place your listing, contact Suzanne Janik at 313-446-0455 / sjanik@crain.com or, for more information, visit our website at: www.crainsdetroit.com/classifieds

REAL ESTATE BUSINESS OPPORTUNITY

Anyone want to cash in on our already very profitable dream?

In 1985 we started buying, fixing and renting apartments in nice houses one block off Woodward in Pontiac, the now nicely developing and bustling downtown and cultural center of Oakland County. We have 3 contiguous houses with 9 finished and 3 possible additional apartments for sale at $630,000 cash. Actual rents have been $7,050/month. We’ve done a lot of work and want the cash to move on to developing a contiguous large placemaking project. It’s a very up-and-coming neighborhood in a very up-andcoming town and we’ll still be there. These apartments are making a lot more money than you can get in a bank. Only people with cash call Tom at 248 408-7393. OFFICE SPACE

Downtown SCS Office Space for Lease

Legal / medical / general office for lease Approx. 1,000 sq. ft 3 Offices, 1 Conference Room, 2 Baths Available August 1st, 2021 For more details: Call (313)477-3861

JOB FRONT POSITION AVAILABLE

 

SUBMIT YOUR AD TODAY

             AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 23

SUPPLY

From Page 3

There’s been little sign of relief from skyrocketing shipping costs, which stem from the near halting of international trade last year due to the COVID-19 pandemic and the unforeseen spike in consumer demand. The average spot cost of shipping from China to the California coast was $10,503 per 40-foot container as of Thursday, a whopping 260 percent higher than a year ago, according to the Drewry World Container Index. Earlier this month in a sweeping executive order promoting more competition, President Joe Biden called out the consolidation of the shipping and rail industries for contributing to kinks in the supply chain. Take the mower blade, for example. It is far and away the highest volume product for BW, which expects to sell about 1 million of them this year. If demand had its way, the number of units sold would likely be 40 percent higher, but lack of supply has thrown a wrench into the equation. Aftermarket parts imported from China make up around half of BW’s business. Over the past six months, shipping costs from the Far East have soared by over half, Hessell said. Inbound shipping used to account for around 4.5 percent of a part’s overall cost; now it’s 7 percent. “We just can’t get them,” Hessell said of the mower blades. “They’ve been delayed five months. That’s been really the most detrimental thing to our business is that dynamic of freight costs going up and the delays in the supply chain.” That’s not to say the neighbor with knee-high grass is totally off the hook. Replacement blades are still available from BW — which does business as Fixmytoys.com and Partdiscounter.com — just at a higher price and with fewer options. Hessell said the cost of a blade has gone up from around $8 to $10. Much of the increase is passed on to the consumer “Doesn’t sound like too much, but if you have three lawn mower blades on each lawn mower, then that set of blades you’re buying might cost you four to six dollars more,” he said. Or, there’s the coffee mug. A typical mug sourced from Asia once cost around $1.50 for MyLocker. com LLC, a custom clothes and accessories maker based in Detroit that retails mugs online starting around $15. With increased shipping container prices, that same mug costs the company close to $1.77. The 27 cents may seem a modest increase, but it represents an 18 percent price hike. Multiplied many times over on a high-volume product, and it starts eating away profit quickly, CFO Bob Kendall said. “The economic argument for international sourcing works when lower product costs more than offset the higher transportation costs of importing the product,” Kendall said. “So, when transportation costs go up, it just changes the formula. As costs go up, there are fewer products where that math is going to work.” Kendall said the company is also grappling with domestic shipping price hikes for the hundreds of thousands of packages it sends each month. He said UPS and FedEx shipping costs have increased 24 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

Workers process packages to be shipped from BW Solutions’ fulfillment warehouse in Chesterfield Township. | KURT NAGL/CRAIN’S DETROIT BUSINESS

A worker customizes a bag at MyLocker, which completed a $15 million expansion in Corktown in 2019. | MYLOCKER

An expensive boat from China

The average cost to get a 40-foot shipping container from Shanghai to California has skyrocketed over the past two years, and experts expect the rise to continue. $12,000

$10,500

$10,000 $8,000 $5,500

$6,000 $4,000 $2,000 0

$1,300 July 2019

$6,000

$6,500

$2,000 July 2020 April 2021 May 2021 June 2021 July 2021

SOURCE: DREWRY SHIPPING AND FREIGHTOS

by two or three times what they were last year. MyLocker has so far avoided passing cost increases to the customer, according to the company, but the option is on the table. “If it’s just going to be a blip, maybe it’s not in our best interest to pass (the cost) along,” Kendall said. “We have not reacted specifically to the increase in container pricing, but we’re watching it closely. We’re looking at shipping overall.” In Shelby Township, Antonio Zucca runs a different type of business with the same set of problems. Electronics board maker LumaSmart Technology International Inc. is growing rapidly with plans for a $4 million expansion

CRAIN’S DETROIT BUSINESS GRAPHIC

thanks to increased demand from clients in automotive and consumer electronics. But circuit boards and semiconductors are hard to secure these days. Zucca said air shipping costs three or four times as much as before the COVID-19 pandemic, while ocean freight is twice the price. The biggest problem though is that shipping has been so sporadic that it’s impossible to maintain steady production. “We’ve had to adjust our production schedule dramatically,” Zucca said. “It’s impacted our bottom line, for sure. We try not to pass along price increases for our customers. Ultimately, we had to for a few of our customers.”

From circuit board suppliers, to tier ones and OEMs, the impact of shipping delays and resulting parts shortages has rippled through every level of the automotive supply chain. Supply issues, most notably the microchip shortage, are predicted to cost the global auto industry more than $110 billion this year, according to Southfield-based consulting firm AlixPartners. Crain’s reached out to several large auto suppliers based in Southeast Michigan, including Lear Corp., BorgWarner Inc. and Adient PLC. The companies declined to comment on the issue. Many of them are in a quiet period before earnings are released the week of Aug. 2. OEMs generally bear the brunt of increased shipping costs, but suppliers suffer from delays, said John Taylor, chair of the department of marketing and supply chain management at Wayne State University. To prevent assembly lines from idling, automakers will often demand that suppliers keep a large amount of “just in case” inventory and penalize them for failure to deliver. “It costs a lot of money to sit on inventory,” Taylor said. “You have to finance it, store it ... it goes obsolete. You want a solid, rapid flow of goods from around the world.” Without that, suppliers are forced to guess how much inventory they need, while factoring in the uncertainty of when it might actually arrive, Taylor said. The guessing game has become a familiar one across industries. At MyLocker, Kendall is preparing for the holiday season — the “Super Bowl” of sales for the company. He has one of two plays: overbuy early and risk sitting on unsold goods, or wait too long and risk being sold out of product in the fourth quarter. He looks to last year to help formulate a game plan. “There were container shipments we expected to receive in November 2020 that didn’t arrive until May 2021, which meant we had to source product domestically at higher prices to meet holiday demand,” he said. “When you’re doing domestic backfill, you’re basi-

cally buying it twice.” As the holiday retail season looms, supply chain disruptions are not likely to let up, said Ravi Anupindi, professor of operations research and management at University of Michigan’s Ross School of Business. That’s largely because the root cause — the COVID-19 pandemic — has not been eliminated. “It’s a supply demand mismatch, and a mismatch over a different time period because different countries are in different phases (of the pandemic),” Anupindi said. “Retail demand completely collapsed, but now people are stocking up, which causes even more congestion.” A recent COVID-19 outbreak in Guangdong, a major coastal province of China responsible for a quarter of all the country’s exports, has posed another threat to the supply chain. According to the U.S. Census Bureau, more than $7.4 billion of goods flowed last year to Michigan from China, the state’s third largest exporter behind Mexico and Canada. The pandemic status of those countries directly impacts trade, Anupindi said. “It’s not enough for us as a population to be vaccinated,” he said. “We need to make sure that the countries we do trade with are as well.” Most executives and experts agree that the vexing supply chain issues beat the more damaging alternative of a collapse in demand. For BW, that means what could have been a phenomenal year will likely be just a good one. The company is projected to turn a $4 million profit in 2021, flat with last year when it hit break even, Hessell said. The company is plowing ahead with expansion in Chesterfield Township, signing earlier this month a lease for another 65,000-square-foot building in the industrial park. It likely won’t be the last. “The reality for most e-commerce businesses is COVID has made a lot of people a lot of money,” Hessell said. Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

VACCINE

have better resources for HR and legal guidance. All the companies I’ve seen have been 500-plus employee companies. Manufacturers can’t afford to be losing people on the line. If the economy were different, I suspect you’d see more of these mandates.”

From Page 3

announced their mandate for their employees, contractors and vendors. However, they timed the mandate so that it applies after the U.S. Food and Drug Administration is expected to fully approve one of the vaccines. The FDA has the Pfizer, Moderna and Johnson & Johnson vaccines approved under emergency use authorization, but the Pfizer vaccine is expected to be fully approved in the coming weeks. It’s unclear why the health systems decided to wait, as they are within their legal rights to mandate right away. Most health systems have vaccinated around 75 percent of employees. Beaumont, Michigan Spectrum employ roughly 94,000 collectively. The mandate could cause another approximately 23,500 workers to receive the inoculation. In total, the five health systems could push an estimated 42,500 workers to become vaccinated, minus those who meet narrow health or religious exemptions under federal law. “We have a duty to protect our patients and our staff. The Delta variant is the most contagious form of COVID-19,” Beaumont CEO John Fox said in a statement last week announcing the mandate. “It spreads much faster than the original version of the virus. We want all Beaumont team members to stay healthy. The

Popular but feared

HOMES

From Page 3

have an sizable impact on the market. Millennials are aging into their peak home buying years, Zillow notes, and Gen Z is not far behind. About three in five millennials and Gen Zers plan to use money saved during the pandemic toward a down payment on a home, according to a recent Zillow survey, showing that even in an unprecedented global pandemic, homeownership “is a priority and aspiration among those sometimes called the ‘rent generation,’” the survey showed. Of the more than 1,200 young adults surveyed by Zillow, 83 percent reported they saved money in at least one spending category during the pandemic. When asked about what they plan to do with the extra cash saved up during that time, the majority (64 percent) said they plan to use it for everyday living expenses, followed by 59 percent saying they planned to use their savings for a down payment on a home.

Market mayhem Some couples choose to go big so they can go home. Mike Comben, 28,

focus on keeping our employees safe while they are at work.” GM has not reinstated the mask mandate elsewhere and is not planning to mandate vaccinations for workers. The same applies for Ford Motor Co., which reinstated its mask mandates at all of its facilities in Missouri and Florida. It is not currently planning to mandate the vaccine for all employees but has done so for employees who conduct international business travel. “We will continue to evaluate COVID-19 case data to make further protocol changes,” the automaker said in a statement to Crain’s. “Ford continues to strongly encourage all team members who are medically able to be vaccinated.” Sean Crotty, partner and chair of the labor and employment department at Detroit law firm Honigman LLP, said the reason more private sector firms aren’t enacting vaccine mandates is due to the labor shortage. It’s the same reason the mandates that have been announced are from large organizations. “We’re tending to see (mandates) more with large employers than small employers,” Crotty said. “They are able to absorb the employee loss resulting from the practice. They also

Employer vaccine mandates are relatively popular among U.S. adults, according to survey data from a Morning Consul poll conducted July 22-24. Nearly three in five of those surveyed said they support vaccine mandates by businesses, schools and governments. That number plummeted among unvaccinated people when asked if the federal government should mandate a vaccine — down to 34 percent in agreement. Roughly 77 percent of vaccinated adults surveyed support a federal mandate. Employer mandates are similarly divided by political affiliation. Just 38 percent of Republicans surveyed backed employer vaccine mandates, compared to 76 percent of Democrats. However, all sides are concerned about the delta variant that is now the most dominant and most infectious strain of the coronavirus in the U.S. About 73 percent of respondents said they were concerned about the variant, while 58 percent of unvaccinated were concerned. Mandates are the most effective tool in getting citizens, and employees, vaccinated. Houston Methodist Hospital — the 16th best hospital in the U.S. according to U.S. News’ Best Hospitals list — was the first major health system to mandate the vaccine for all employees, effective June 7. The health system saw a more than 98 percent compliance rate with just 153 workers terminated or resigned for noncompliance. The remaining 2 percent were able to achieve exemptions. Houston Methodist did face an early legal battle as 117 employees filed a lawsuit against the hospital. But the case was quickly tossed by a

and 26 respectively, the couple knew the lease on their Detroit apartment was up for renewal, so they were ready to buy instead of rent. They reached out to Dino Ricci of Sine & Monaghan Real Living in Grosse Pointe Farms for help finding their slice of the American dream. “Being stuck at home this past year made us realize we needed more space. Also, I had just finished grad school at U of M and Allison has a few years left in grad school here at Wayne State, so it seemed a good time to invest in a house based on our career trajectories,” Piontkowski said. With a 10 percent down payment at the ready, they jumped into the market. But the experience soon became “overwhelming,” Piontkowski said. The couple saw 12 houses and made an offer on two of them that were “well above asking,” but still failed to seal the deal. “We moved incredibly quickly to try to see houses as soon as they came on the market,” Piontkowski said. “With the low inventory and compressed timeline of houses taken off the market within two days, we felt incredible pressure to make offers on houses that we didn’t love or had significant issues, like a garage falling over. Even those houses sold

system that has been and likely will way higher than asking.” They “were close to giving up or at continue to be a buyer’s market is a least expanding our search to other key part of Sophie Smith’s work as a cities” before they finally found the Realtor with RW Realty in Royal Oak. right house. The home on Noorwood At 25, Smith said she works with Street that Ricci helped them find in many millennials and Gen Z buyers Grosse Pointe Woods at 1,449 square who may not realize they are in for a feet feels like home, Piontkowski “rough ride” in real estate. “It’s been really brutal on a lot of said. “We were close to making offers on buyers, especially my first-time buyhouses that had issues or didn’t fit ers, so you have to set those expectaour preferences just because we were tions with them,” Smith said. “It’s reso stressed and pressured by the ally important to know your finances market,” Piontkowski said. “We are so — especially over the past few happy we were patient and eventual- months. Do not make yourself house poor. If you’re coming into this, ly got the house we wanted.” Millennial and Gen Z buyers like throwing crazy appraisal money Piontkowski and Moll are the norm around or having to come to the table in this extremely competitive market, with more money, then you can’t Ricci said. They tend to lose on a few homes because “IT’S DEFINITELY AN ON-THE-FLY the market is simply so aggressive on price and LEARNING EXPERIENCE FOR speed. “It’s definitely an on-the- FIRST-TIME BUYERS.” fly learning experience for — Dino Ricci of Sine & Monaghan Real Living first-time buyers,” Ricci said. “As I tell my first-time buyers after our decorate or buy furniture.” The bottom line is making sure the first meeting: it’s a learning process. In today’s market the buyer has to make a money and the home you end up lightning-fast decision. I can give with matches your expectations, counsel to them and give them recom- Smith said. “The main thing I try to get into mendations, however, ultimately, it’s buyers’ heads is don’t give up. The the buyer decision.” Figuring out how to work within a right house will come along,” she said.

A wave of Michigan health systems declared last week that they’d require the COVID-19 vaccine for their employees. | NIC ANTAYA/SPECIAL TO CRAIN’S DETROIT BUSINESS

President Joe Biden said Thursday he’ll require federal workers to prove they’ve been vaccinated against COVID-19 or wear masks and submit to frequent coronavirus testing as the highly contagious delta variant is causing cases to spike in the U.S. Most employers remain fearful of pushing for a vaccine mandate, including manufacturers whose employees largely work shoulder to shoulder in factories across the country. Manufacturers battled severe absenteeism from sick workers and continued outbreaks during the first two waves of the pandemic across the state. General Motors Co. reinstated last week its mask mandate at “WE HAVE A DUTY TO PROTECT OUR its Wentzville Assembly Plant northeast of St. PATIENTS AND OUR STAFF.” Louis. — John Fox, CEO, Beaumont Health Missouri has faced a severe outbreak of the vaccine is the only safe and effective delta variant, mostly among its unway to truly protect against vaccinated population. The state’s COVID-19 seven-day average posiCOVID-19.” But the mandates, for now, are tivity rate spiked to 14.7 percent last limited to the region’s health systems week and cases shot up to nearly and certain federal government 90,000 during a seven-day period. In a statement, GM told Crain’s workers, such as the Veterans’ Administration. Large tech companies, “that decision was made after our including Google, Twitter and Face- GM Medical team recommended it book, have also mandated the vac- based upon local infection rates, cine for office workers across the U.S. community spread of the virus with a

knew there was an opportunity when the U.S. stock market crashed at the beginning of the pandemic. Comben, a graduate student at Eastern Michigan University who is getting his MBA in finance, parlayed that investment into a down-payment fund. His fiancée, Jan Gamboa, 29, agreed it was time to buy. The newly engaged couple started looking on real-estate websites to find something around the EMU/Ann Arbor area where they both work full time. Once they knew what the market was like, they contacted Lang for help. After looking at one other house, the couple made an offer on a four-bedroom, two-bathroom home with a large yard in Ypsilanti for their two dogs. “We were really worried because of the market — we didn’t know what to expect,” Gamboa said, but they wanted to move quickly so a property-management company wouldn’t come in and swoop up the home they had stalked online. “It took us about four weeks from making the offer to closing (in mid-July). We didn’t realize it would be so quick. But we’re glad it was. Now that it’s over with, we can take a breath,” Gamboa added. The opposite was true for Andrew Piontkowski and Allison Moll. At 25

federal judge as the law clearly allows employers to mandate vaccines. But those legal costs may be enough to scare off many companies, Crotty said. “I’m not surprised health care companies are doing this, they’ve done it before,” Crotty said. “They understand the process. Most firms don’t and that’s why I think mandating will remain a minority position.” The state of Michigan is all but begging the private sector to begin widespread mandating, largely because vaccinations across the state, following the U.S. trend, have stalled. Just 63.4 percent of Michigan residents 16 years and older have received at least one dose of the COVID-19 vaccine. The needle has hardly moved, even with a $5 million vaccine lottery, in July. On July 1, 61.7 percent of adults 16 years and older in Michigan had at least one dose. Kerry Ebersole Singh, director of the Protect Michigan Commission overseeing vaccine rollout, said the state can get to its 70 percent vaccinated goal if the private sector is serious about safety. “It’s going to take private sector partners stepping up or sticking to what they see as necessary to protect their customers,” Ebersole Singh said. “We’re seeing that with the airlines and some of the universities. We’re seeing that with some of our health care institutions as well.” In the meantime, the U.S. Centers for Disease Control and Prevention issued new recommendations this week advising the vaccinated to again wear masks at indoor gatherings in places showing substantial or high transmission risk. Ten Michigan counties fall into that category. “We’re just not going to see large scale bumps in (vaccination) numbers,” Ebersole Singh said. “We’re going to be eking out shots every day and celebrating every shot in the arm we get. The delta variant is spreading wildfire. It’s frightening. There’s always hope that there’s going to be a continued commitment to increase vaccination rates. I hope it’s enough.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

AUGUST 2, 2021 | CRAIN’S DETROIT BUSINESS | 25

THE CONVERSATION

After turnaround, Shyft CEO Daryl Adams navigates new challenges SHYFT GROUP INC.: Shyft has lived up to its name since changing it a year ago. Formerly Spartan Motors, the once struggling specialty vehicle manufacturer is growing quickly after dropping emergency vehicles in favor of delivery vans and moving its headquarters from Charlotte to Novi. Revenue is expected to exceed $1.75 billion by 2025, said President and CEO Daryl Adams, a career car guy whose knack for repairing old engines translated well to C-suite problem solving. Adams, 59, has steered Shyft through major change since taking the helm in 2015. But that was only the beginning for a company navigating the explosion of e-commerce and the ongoing production and supply disruptions since the COVID-19 pandemic. This interview has been condensed and lightly edited for clarity. | BY KURT NAGL ` You’ve been in the automotive space your entire career, including 17 years with Lear Corp. What drew you to the industry? I would say it probably goes back to my grandparents. They were actually in Canada on my mom’s side where they had a farm, and in the summertime I’d spend time over there. And obviously things would break, and they’d have to fix them, and I always wanted to be part of it. We had go-karts and mini-bikes that would break, and I had to fix them. So, people can say it’s in their DNA or it’s just, you know, what you’re exposed to. But I was exposed to that ‘operate, fix, repair; operate fix, repair’ my entire life. I messed around with some cars in high school ... trying to make them go faster or look better or sound better. And my dad was in the auto industry, but I was the first (in the family) to graduate with a degree ... and that was an engineering degree. ` When you took the helm at Spartan Motors, you made some pretty drastic changes. Can you take me through what led to them? I was the first nonfamily CEO, so that was a pretty significant change for the organization. And unfortunately, at the time, the company was struggling. They had a really nice balance sheet, but performance-wise, revenue and profits were going the wrong way. So, it was a turnaround. A lot of times in automotive, they try to cut their way to profitability, and I’ve seen that not work a bunch of times through my experience in the auto industry. So what I did is, even in the tougher times we had, we started hiring people, hiring good talent at the leadership roles, because we were going to fix the company, and to do that, you need a good team. We had a lot of legacy issues that came up with government agencies. Some

recalls. So, we had a lot to accomplish, right, and I think it’s just bringing the automotive mindset into the company. And then the next step was, once we started to become profitable, in part of ’16 and ’17, then we moved into, ‘All right, what’s our five-year strategy?’ ` So, what’s the strategy today? Each year, we roll it five years forward. And part of that strategy, if you have an underperforming division, you try to improve it the best that you can. The emergency response business was underperforming when I got there — significantly. We brought it to slightly profitable in ’18 after a lot of hard work, and then in ’19, we decided to sell it. The board agreed with us at the time management brought it forward, and we divested that in 2020. It wasn’t the original strategy, but as we saw e-commerce rates start to grow in ’17 and ’18, a lot of management’s resources were consumed by the underperforming division. ER, one would say, is a bit of a declining industry, because the fire marshals always try to ... build buildings that won’t have a fire, so they’re always trying to put themselves out of business. We could grow the company faster if we didn’t have that division and everyone was focused on last mile (delivery) and our service body business that we were acquiring in ’19. So, the strategy helped us lay that out.

want to go out to get food and other products, and the consumer switched to ordering online. ... When we look at the data, I think it’s surprising how many consumers are still continuing to order online. ... Our customers, the big last-mile delivery customers, figured out by the end of ’19 what they were going to need because it was starting to stick, and they were starting to see some sustainability to the online ordering. So in 2020, we saw our backlog really improve, and we still can see it improve today. ` How has the pandemic hurt the company? When you move forward to today, where you’re hearing about a lot of the microchip issues and automotive plants shutting down, we feel it. And we continue to feel it as you move further down the supply chain, where they’re starting to have raw material issues, they’re starting to have labor issues … We’re out in front, trying to source new suppliers, and that’s even harder in today’s environment with

the constraints that they have. We’re still shipping to our customers. We’re meeting all the requirements. Some of the OEMs are shut down for a period of time, so that does impact us. We currently build the Velocity (delivery vehicle body) on the Ford Transit (chassis). We can build the Velocity body on the Mercedes Sprinter. We will be coming out with our Dodge Ram Velocity here shortly. We also have up-fit facilities that build the interiors for delivery of the cargo van ... But the team is working closely with the OEMs, trying to understand this so we can time it out. It is slowing down our growth. Our analysts earlier in the year had us at a 30-plus percent growth rate. And so, we have been working to hit that 30 percent. We’re adapting. We’re modifying production levels. We’re modifying along with our customers. Our customers are adapting with us on chassis that we can get, so I think we’ll still have a pretty good year. As a public company, I can’t disclose all the inside numbers, but it’s not going to affect us, I don’t think, as most people would expect. Daryl Adams, president and CEO, Shyft Group

` In what ways has the COVID-19 pandemic helped business? I think COVID accelerated e-commerce by two to three years ... and we just happened to be already in that space. And we had the ability to accelerate it during COVID, which I give the team and all of our employees credit for that. ... So when the pandemic hit, everyone was concerned. People didn’t

READ ALL THE CONVERSATIONS AT CRAINSDETROIT.COM/

RUMBLINGS

West Michigan biz leaders, groups lend Duggan support

26 | CRAIN’S DETROIT BUSINESS | AUGUST 2, 2021

Detroit Mayor Mike Duggan, running for re-election to a third term, is pictured at a Michigan Regional Council of Carpenters and Millwrights event July 19. | CITY OF DETROIT VIA FLICKR

“I think people in the city of Grand Rapids and this area are very curious about him,” she said. “They want

REPORTERS

Jason Davis, small and emerging businesses. (313) 446-1612 or Jason.davis@crain.com Annalise Frank, city of Detroit. (313) 446-0416 or afrank@crain.com Nick Manes, finance and technology. (313) 446-1626 or nmanes@crain.com Kurt Nagl, manufacturing. (313) 446-0337 or knagl@crain.com Kirk Pinho, senior reporter, real estate. (313) 446-0412 or kpinho@crain.com Dustin Walsh, senior reporter, health care. (313) 446-6042 or dwalsh@crain.com Sherri Welch, senior reporter, nonprofits and philanthropy. (313) 446-1694 or swelch@crain.com MEMBERSHIPS

CLASSIC $169/yr. (Can/Mex: $210, International: $340), ENHANCED $399/yr. (Can/Mex: $499, International: $799), PREMIER $1,299/yr. (Can/Mex/International: $1,299). To become a member visit www.crainsdetroit.com/ membership or call (877) 824-9374 Group and Corporate Membership Sales Deb Harper, (313) 446-1623 or dharper@crain.com ADVERTISING/MARKETING

Sales Inquiries (313) 446-6032; FAX (313) 393-0997 Director of Events and Program Content Kristin Bull, (313) 446-1608 or kbull@crain.com Senior Event Director Shelby Jones Managing Director, Marketing and Events Jill Heise Senior Account Executives Maria Marcantonio, John Petty Advertising Sales Lindsey Apostol, Ainsley Burgess, Sharon Mulroy, Mark Polcyn People on the Move Manager Debora Stein, (917) 226-5470, dstein@crain.com Marketing Manager Lynn Zott, lzott@crain.com or (313) 446-6762 Senior Art Director Sylvia Kolaski Media Services Manager Nicole Spell (212) 210-0230 or nspell@crain.com Classified Sales and Sales Support Suzanne Janik CUSTOMER SERVICE

THECONVERSATION

AHEAD OF TUESDAY’S PRIMARY, Detroit Mayor Mike Duggan is reaping support from the west side of the state. That includes West Michigan business names that typically support Republicans. At a reception for the Democrat, who is seeking his third term, nearly 60 Grand Rapids-area individuals interested in the mayor’s work brought in $29,900 for his campaign, compared with $17,600 at a similar event in 2017. Grand Rapids businesswoman Marge Byington, who hosted the event, told Crain’s that Duggan talked about job creation, housing, COVID-19 and helping communities improve.

crainsdetroit.com

Editor-in-Chief Keith E. Crain Publisher KC Crain Group Publisher Jim Kirk, (312) 397-5503 or jkirk@crain.com Associate Publisher Lisa Rudy, (313) 446-6032 or lrudy@crain.com Executive Editor Kelley Root, (313) 446-0319 or kelley.root@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Digital Editor for Audience Elizabeth Couch, (313) 446-0419 or elizabeth.couch@crain.com Digital Portfolio Manager Tim Simpson, (313) 446-6788 or tsimpson@crain.com Assistant Managing Editor Dawn Bradbury, (313) 446-5800 or dbradbury@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Senior Editor Chad Livengood, (313) 446-1654 or clivengood@crain.com Special Projects Editor Amy Elliott Bragg, (313) 446-1646 or abragg@crain.com Design and Copy Editor Beth Jachman, (313) 446-0356 or bjachman@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687 TIP LINE (313) 446-6766

to know his philosophies, and he expressed them very eloquently, and there were, you know, some different questions about what was going on in Detroit, and how he viewed the state.” West Michigan donors this election cycle include Doug Meijer, co-chairman of Walker-based Meijer Inc.; owner Hendrick Meijer and other Meijer executives, who gave a total of $12,500; and Grand Rapids City Commissioner Joe Jones, former head of the Urban League of West Michigan, gave $250. The Secchia family of Grand Rapids has also remained in Duggan’s corner: Peter Secchia, a well-known

businessman and Republican fundraiser who died in October, gave Duggan $500 for his first run at mayor and $1,000 for his re-election campaign. This year Secchia’s wife Joan and their son Charlie each contributed $500. Another West Michigan business magnate, former Perrigo Co. Chairman Mike Jandernoa, doubled last election cycle’s gift, this time donating $1,000. However, two other Grand Rapids businessmen, Doug DeVos and Steve Van Andel of Amway, have not given this election cycle. Each of them contributed $500 when Duggan was vying for his second term.

Single copy purchases, publication information, or membership inquiries: (877) 824-9374 or customerservice@crainsdetroit.com Reprints: Laura Picariello (732) 723-0569 or lpicariello@crain.com Crain’s Detroit Business is published by Crain Communications Inc.

Chairman Keith E. Crain Vice Chairman Mary Kay Crain CEO KC Crain Senior Executive Vice President Chris Crain Secretary Lexie Crain Armstrong Chief Financial Officer Robert Recchia G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996) Editorial & Business Offices 1155 Gratiot Ave., Detroit MI 48207-2732; (313) 446-6000 Cable address: TWX 248-221-5122 AUTNEW DET CRAIN’S DETROIT BUSINESS ISSN # 0882-1992 is published weekly, except no issues on 1/4/21 nor 12/27/21, combined issues on 5/24/21 and 5/31/21, 8/30/21 and 9/6/21, 11/15/21 and 11/22/21, by Crain Communications Inc. at 1155 Gratiot Ave., Detroit MI 48207-2732. Periodicals postage paid at Detroit, MI and additional mailing offices. POSTMASTER: Send address changes to CRAIN’S DETROIT BUSINESS, Circulation Department, P.O. Box 07925, Detroit, MI 48207-9732. GST # 136760444. Printed in U.S.A. Contents copyright 2021 by Crain Communications Inc. All rights reserved. Reproduction or use of editorial content in any manner without permission is prohibited.

Leader

• Friend • Inspiration

DP+ is profoundly saddened by the loss of Andy Prakken. And we are equally grateful for everything he shared with us and the advertising community. He was an inspiration and will remain so. Thank you, Andy.

Crains_Andy_Prakken_F1.indd 1

7/28/21 10:18 AM

AT&T BUSINESS TIP:

Get a

FASTER INTERNET

EXPERIENCE

25x FASTER AT&T Business Fiber® 1GIG

UP TO

upload speeds than cable*

NO NO

ANNUAL TERM COMMITMENT BUNDLE REQUIRED

Switch to AT&T Business Fiber—now at our lowest price ever.

Call: 844.740.FAST

Visit: att.com/businessfast

Limited availability in select areas. May not be available in your area. Call or go to att.com/businessfast to see if you qualify.

*Based on comparison of Internet 1000 w/wired upload connection to Comcast and Spectrum 1GIG svc w/upload speed of 35Mbps. AT&T Business Fiber. Go to www.att.com/smallbusiness/explore/internet.html to check qualification. Additional Fees & Taxes: AT&T one-time transactional fees and monthly cost recovery surcharges which are not government-required may apply, as well as taxes. See www.att.com/BusinessInternetFees for details. Installation: $99 installation charge may apply. Subject to Internet Terms of Service at att.com/internet-terms. Prices and offers subject to change without notice. Advertised services not available in all areas. Credit restrictions and other conditions and limitations may apply. ©2021 AT&T Intellectual Property. AT&T, Globe logo, and DIRECTV are registered trademarks and service marks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks are the property of their respective owners.

BEST BUSINESS SERVICES.

HALF THE PRICE. Switch today and your business could cut its current Internet and Phone bill in half.^ 200Mbps INTERNET

BUSINESS PHONE

/mo. when bundled for 1 year*

/mo. per line when bundled with Internet for 1 year**

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS. OVER

99.9% NETWORK RELIABILITY§

200 Mbps

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

Switch today and you could cut your current Internet and Phone bill in half.^

200

More speed.° Over 99.9% network reliability.§

200Mbps Spectrum Business Internet always includes: FREE modem FREE award-winning desktop security+ FREE email addresses

Mbps

The best business features. Included at no additional cost.

200Mbps INTERNET

99 /mo. when bundled for 1 year*

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS.

Spectrum Business Phone always includes: 35+ FREE Business Calling Features like: FREE 3-Way Calling FREE Call Transfer FREE Voicemail to Email FREE Call Forwarding

BUSINESS PHONE

99 /mo. per line when bundled with Internet for 1 year**

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS.

Need even more speed? Ask about Spectrum Business Internet Gig with speeds up to 1 Gbps.

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

Limited-time offer; subject to change. Qualified new business customers only. Must not have subscribed to applicable services w/ in the last 30 days & have no outstanding obligation to Charter. *$49.99 Internet offer is for 12 mos. when bundled w/ TV or Voice & incl. Spectrum Business Internet starting speeds. Speed based on download speed on wired connection. Wireless speed may vary. Available speeds may vary by address. Spectrum Internet modem is req'd & included in price. **$19.99 Voice offer is for 12 mos. when bundled with Internet & incl. one business phone line w/ unlimited local & long distance w/ in the U.S., Puerto Rico, & Canada plus 2,000 long-distance minutes to Mexico. Limited-time offer. Offer not available in all areas. Includes phone taxes, charges and fees. Other telephone services may have corresponding taxes and rates. Spectrum Business Internet Gig requires Spectrum Gig capable modem. Additional installation fees apply. +Based on the most annual `Best Protection' AV-TEST awards, industry-leading advanced attacks detection capabilities confirmed by MITRE ATT&CK® evaluations, and 2020 Customers' Choice for Vulnerability Assessment in Gartner Peer Insights. §99.9% network reliability based on average HFC Availability, Jan 2019 - Feb 2021. Visit business.spectrum.com/network-reliability for details. °Speed claim based on Internet speed of competitors' current customers vs 200Mbps Internet starting speed from Spectrum Business. ^Based on average savings with Spectrum Business promo rates vs. competitors' non-promo rates for Internet & 2 phone lines. Actual savings may vary. Services subject to all applicable service terms & conditions, which are subject to change. Services & promo. offers not avail. in all areas. Standard pricing applies after promo. period. Installation & other equipment, taxes & fees may apply. Restrictions apply. Call for details. © 2021 Charter Communications, Inc.

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

Limited-time offer; subject to change. Qualified new business customers only. Must not have subscribed to applicable services w/ in the last 30 days & have no outstanding obligation to Charter. *$49.99 Internet offer is for 12 mos. when bundled w/ TV or Voice & incl. Spectrum Business Internet starting speeds. Speed based on download speed on wired connection. Wireless speed may vary. Available speeds may vary by address. Spectrum Internet modem is req'd & included in price. **$19.99 Voice offer is for 12 mos. when bundled with Internet & incl. one business phone line w/ unlimited local & long distance w/ in the U.S., Puerto Rico, & Canada plus 2,000 long-distance minutes to Mexico. Limited-time offer. Offer not available in all areas. Includes phone taxes, charges and fees. Other telephone services may have corresponding taxes and rates. °Speed claim based on Internet speed of competitors' current customers vs 200Mbps Internet starting speed from Spectrum Business. ^Based on average savings with Spectrum Business promo rates vs. competitors' non-promo rates for Internet & 2 phone lines. Actual savings may vary. §99.9% network reliability based on average HFC Availability, Jan 2019 - Feb 2021. Visit business.spectrum.com/network-reliability for details. =Value based on retail price for comparable services. Services subject to all applicable service terms & conditions, which are subject to change. Services & promo. offers not avail. in all areas. Standard pricing applies after promo. period. Installation & other equipment, taxes & fees may apply. Restrictions apply. Call for details. © 2021 Charter Communications, Inc.

Switch today and you could cut your current Internet and Phone bill in half.^

200

More speed.° Over 99.9% network reliability.§

200Mbps Spectrum Business Internet always includes: FREE modem FREE award-winning desktop security+ FREE email addresses

Mbps

The best business features. Included at no additional cost.

200Mbps INTERNET

99 /mo. when bundled for 1 year*

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS.

Spectrum Business Phone always includes: 35+ FREE Business Calling Features like: FREE 3-Way Calling FREE Call Transfer FREE Voicemail to Email FREE Call Forwarding

BUSINESS PHONE

99 /mo. per line when bundled with Internet for 1 year**

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS.

Need even more speed? Ask about Spectrum Business Internet Gig with speeds up to 1 Gbps.

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

Limited-time offer; subject to change. Qualified new business customers only. Must not have subscribed to applicable services w/ in the last 30 days & have no outstanding obligation to Charter. *$49.99 Internet offer is for 12 mos. when bundled w/ TV or Voice & incl. Spectrum Business Internet starting speeds. Speed based on download speed on wired connection. Wireless speed may vary. Available speeds may vary by address. Spectrum Internet modem is req'd & included in price. **$19.99 Voice offer is for 12 mos. when bundled with Internet & incl. one business phone line w/ unlimited local & long distance w/ in the U.S., Puerto Rico, & Canada plus 2,000 long-distance minutes to Mexico. Limited-time offer. Offer not available in all areas. Includes phone taxes, charges and fees. Other telephone services may have corresponding taxes and rates. °Speed claim based on Internet speed of competitors' current customers vs 200Mbps Internet starting speed from Spectrum Business. ^Based on average savings with Spectrum Business promo rates vs. competitors' non-promo rates for Internet & 2 phone lines. Actual savings may vary. §99.9% network reliability based on average HFC Availability, Jan 2019 - Feb 2021. Visit business.spectrum.com/network-reliability for details. =Value based on retail price for comparable services. Services subject to all applicable service terms & conditions, which are subject to change. Services & promo. offers not avail. in all areas. Standard pricing applies after promo. period. Installation & other equipment, taxes & fees may apply. Restrictions apply. Call for details. © 2021 Charter Communications, Inc.

STOP OVERPAYING

FOR BUSINESS INTERNET AND PHONE. Switch today and get more speed° and proven reliability§ for up to half the price of what you're paying now.^

200Mbps INTERNET

BUSINESS PHONE

/mo. when bundled for 1 year*

/mo. per line when bundled with Internet for 1 year**

NO ADDED TAXES. NO HIDDEN FEES. NO CONTRACTS.

No data caps No speed throttling FREE modem and other features ($50 value=)

OVER

99.9

NETWORK RELIABILITY§

200 Mbps

Unlimited local and long distance calling 35+ FREE advanced calling features Keep your existing phone number and equipment

OFFER GOOD THROUGH 09/30/21

CALL 866-493-9457 VISIT BUSINESS.SPECTRUM.COM

SMB-GEN200 - 0802