Crain's Detroit Business, Jan. 20, 2020 issue by Crain's Detroit Business

THE CONVERSATION Helen Taylor, state director of the Michigan Chapter of The Nature Conservancy, Lansing.

SOUR TIMES: Tariff elimination means tough road ahead for cherry industry. PAGE 6

PAGE 22 CRAINSDETROIT.COM I JANUARY 20, 2020

NAIAS

Bumpy January for some amid show shift

Businesses that benefit stay hopeful about June move BY DUSTIN WALSH, SHERRI WELCH AND ANNALISE FRANK

The North American International Auto Show’s move to June left a crater in balance sheets around metro Detroit’s business community — at least temporarily. With no January auto show at TCF Center (formerly Cobo Center), The Firebird Tavern is expected to lose 20 percent, or approximately $30,000-$35,000, in sales over a typical January. The Monroe Street restaurant in Detroit’s Greektown generally hosts three to five corporate events in the first month of the year tied to NAIAS, said co-owner Tony Piraino. Plus there’s an influx of visitors downtown during the show, and the less often accounted for workers who would land in December for setup. “We’ve been prepared for it for a long time,” Piraino said. “It’s the old adage of getting leaner and looking hard at our food costs, inventories, booze on the shelf, and understanding you’re going to have a slow month and bracing and preparing for that … a little bit less (staff ) hours based on how busy we are, but not drastic. Some of it is still an unknown. Usually the auto show kicks off around this time, so … the book is still out.” A January without an auto show played at least a minor role in a decision to close Corktown restaurant Gold Cash Gold, chef-partner Brendon Edwards said in an email to staff announcing the closure last week. The Southern-influenced American restaurant will close around Feb. 2 after five years in business. See AUTO SHOW on Page 18

FOCUS | WORKFORCE TRENDS

FACING THE FUTURE OF WORK The future is here: Automation and artificial intelligence are part of how we work today. But are Michigan businesses ready for how radically they will change our jobs and our organizations?

Plus: How to harness the power of AI to better understand your employees. PAGES 10-12.

ILLUSTRATION BY IRINA STRELNIKOVA

REAL ESTATE INSIDER

Testing the marijuana market: Business booms at safety compliance labs BY KURT NAGL

Asking $18 million for Detroit riverfront properties PAGE 4

NEWSPAPER

CANNABIS

The cost for marijuana growers and processors to certify product for safety compliance, as mandated by Michigan, is whatever a lab wants to charge. That’s because in the state’s incipient marijuana industry, there is still relatively little competition in cannabis testing and lots of demand. There are seven facilities licensed to test medical marijuana and just one approved to test both — PSI Labs LLC in Ann Arbor. The business backlog swells by the day at the lab, located in an office complex on the outskirts of the propot town. Not only is it the only place in the state to certify recreational product, it is the only lab equipped to

A vial of powdered cannabis being tested for contaminants and heavy metals. | KURT NAGL/CRAIN’S DETROIT BUSINESS

test for Vitamin E acetate in vapes. So when the state in November ordered all retailers to test for the harmful compound, PSI was inundated with marijuana-infused vape cartridges. After unburying itself from vapes — a surprise bit of work that’s likely amounted to a million-dollar-plus windfall for the company — the lab will refocus on its core business of general marijuana safety certification testing, where it has majority market share, said CEO Ben Rosman, 37, who co-founded PSI in 2015 with childhood friend Lev Spivak-Birndorf, also 37. See LABS on Page 20

NEED TO KNOW

THE LONG RECOVERY

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT ` MICHIGAN SEEKS ENBRIDGE RECORDS GOING BACK DECADES THE NEWS: Michigan officials demanded an extensive set of records Monday from Enbridge Inc. in an investigation of the company’s oil pipeline that runs beneath a channel linking two of the Great Lakes, the Associated Press reported. In a letter to the Canadian company, the state Department of Natural Resources requested documents dating back to 1953, when two 20-inch pipelines were placed across the bottom of the Straits of Mackinac. WHY IT MATTERS: Gov. Gretchen Whitmer last June ordered a review of Enbridge’s compliance with an easement that set conditions for the company to place the pipelines on the Great Lakes bottom. The Democratic governor, who has echoed environmentalists’ concerns that the pipes are unsafe and could leak, said violations of the easement could justify an order to shut down the line.

` AUTO SHOW ADDS SUPERCAR FESTIVAL THE NEWS: The 2020 Detroit auto show will feature a prelude weekend event to showcase European supercars. Motor Bella, scheduled for June 5-8, will feature Italian and British supercars, provided by global auto companies, local dealers and car clubs. The

vehicles will be displayed on Broadway Street downtown next to the Detroit Opera House. WHY IT MATTERS: The added event shows how the show is working to expand beyond its traditional boundaries inside TCF Center (formerly Cobo Center) and add more experiential elements aimed at luring new audiences.

and Environmental Department, told The Detroit News. WHY IT MATTERS: A Nov. 26 dock collapse spilled an unknown amount of limestone construction aggregate into the river. The U.S. Environmental Protection Agency found uranium, lead, several chemicals and heavy metals during testing of water samples at the industrial site. The Detroit News reported that Great Lakes Water Authority officials found no impact on water quality in new tests.

` CONSUMERS, DTE ISSUE CHARGER REBATES

` CITY FINES COMPANY WHERE DOCK COLLAPSED THE NEWS: The city of Detroit has fined the company that owns a site along the Detroit River where a collapsed dock sent construction aggregate material into the river for illegally storing tons of limestone for months, a city official said. Revere Dock LLC has been hit with a $10,000 fine for storing nearly 40,000 tons of limestone on its dock without a permit since July, David Bell, the city’s director of Buildings, Safety Engineering

LANDMARK OFFICE CENTER

THE NEWS: Michigan’s electric vehicle charging network got a boost this year when Jackson-based Consumers Energy Co. issued 387 rebates for electric vehicle charging stations at homes and in public locations across Michigan. A similar program at Detroit-based DTE Energy Co. has approved nearly 50 fast charger rebates and 220 rebates for residential and commercial Level 2 chargers. WHY IT MATTERS: Thousands of EV chargers are expected to be installed in Michigan over the next two years to help reduce what experts call “range anxiety,” the fear EV drivers have that they may run out of electricity on long trips. Consumers alone projects it will double the number of EVs in its territory from 4,000 to 8,000 by 2022.

Home prices top pre-recession peak, but not in Detroit `Fueled by a strong economy and low unemployment rates, metro Detroit home sales prices jumped nearly 6 percent in 2019 to a median of $190,000, capping off a decade of recovery from the Great Recession. The home sales price last year represents a 27 percent increase from 2015, when the median was $150,000, according to year-end data released last week by Farmington Hills-based Realcomp Ltd. II. Over the past decade, the median home sales price has nearly tripled from $66,900 in 2010. It has also exceeded where it was prior to the recession. In 2005, the median sales price was about $170,500. Detroit saw the most dramatic change in the region. The median home sales price in the city last year was $43,063. That’s 23 percent higher than $35,000 in 2018 and a 115 percent increase from 2015, when the median price was $20,000. In 2010, the median sales price in the city hovered around $11,000. Sales prices in the city have yet to return to pre-recession levels, however. The median sales price in Detroit in 2005 was around $59,000.

` PGA TOURNEY RAISES $1.2M FOR NONPROFITS THE NEWS: The Rocket Mortgage Classic, Detroit’s inaugural PGA tournament that took place last summer, raised $1.2 million for local nonprofits, organizers said. About $1.1 million of it is being directed to nonprofits based in Detroit, said tournament Executive Director Jason Lan-

gwell. Among the grantees are Midnight Golf ($225,000), Detroit Children’s Fund ($200,000) and the Greater Palmer Park Community ($150,000). WHY IT MATTERS: Executive Director Jason Langwell called the charity haul “unprecedented” for a first-year PGA event. This year’s tournament is scheduled for May 25-31.

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2 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

NONPROFITS

DIA shines light on offerings Focus is on awareness as millage vote nears BY SHERRI WELCH

The Detroit Institute of Arts is working to raise its profile with less than two months to go before voters decide the museum’s early millage renewal. The museum is using a direct mail campaign and other efforts to highlight its upcoming exhibitions, like “Van Gogh in America” due out in June, and the benefits it provides to voters in Wayne, Oakland and Macomb counties in exchange for millage support. And this week, DIA Director Salvador Salort-Pons and his team will be in New York City to meet with national print and broadcast outlets. Voters in the three counties, which approved Salort-Pons an operating millage for the museum in 2012, are set to weigh in on its early renewal March 10. The DIA last week brought Kermit the Frog out of storage for the first time in over 20 years. Kermit will be on display through late March, along with the original 1947 Howdy Doody puppet, last on view at the DIA in 2015. The puppets are popular with the public and show the museum’s desire to reach everyone with its collection, Salort-Pons said. The world-renowned art museum’s diverse collection also includes works by famed artists like Vincent van Gogh, he said. And its development of an “extraordinary partnership” with the three counties to provide services in return for millage support stands out among the small number of U.S. museums receiving public support, he said. The trouble is, few residents know about the museum’s offerings and the services and programs it provides in exchange for millage support, Salort-Pons said.

MENTORING MODEL

Friends of the Children, a national nonprofit, pairs high-risk kids with salaried, professional mentors for 12 years. | FRIENDS OF THE CHILDREN

National Friends of the Children brings 12-year program to Detroit BY SHERRI WELCH

Longtime United Way executive Nicole McKinney will lead the Detroit chapter.

Friends of the Children, a national nonprofit that pairs high-risk kids with salaried, professional mentors for 12 years, is expanding to Detroit. The Portland-based organization brings proven success in breaking generational cycles of educational and social issues, according to data it’s collected. It’s secured $1.5 million in local and national seed money to fund its first two years in Detroit and plans to launch here by summer, focusing on the most vulnerable children and providing support to their parents through a two-generation approach.

Longtime United Way executive Nicole McKinney will lead the independent, Detroit chapter as executive director. She brings 19 years’ experience in the United Way network, most recently serving as the work-based learning director for United Way for Southeastern Michigan. McKinney, 50, will be charged with building a board and hiring an initial staff of six: program and operations directors and four “friends” or paid mentors who will work with a total of 32 highrisk children. Friends will select children age 4-6 to take part in the program based on recommendations from Detroit school leaders, the Michi-

gan Department of Health and Human Services and other service providers in the city, said CEO Terri Sorenson. Those children will be paired with a mentor for the full 12 years, so long as the children remain living within 30 miles of the city. The plan for Friends of the Children-Detroit is to add 32 more children each year and another four mentors to the staff to serve them, bringing the Detroit chapter to full scale of 300-500 children within 10 years, Sorenson said. It is, of course, contingent on raising the dollars to scale it. See FRIENDS on Page 20

FOOD AND DRINK

Local efforts In 2018, focus groups with residents showed that less than a third, or just 30 percent of those surveyed, knew they were entitled to free admission. “We discovered that we needed to raise awareness about the benefits,” Salort-Pons said. Those benefits include free admission, free programs and transportation for seniors, free field trips for 80,000 students last year and a community partnership program with other local nonprofits. The Hudson-Webber and William Davidson foundations — two of the foundations that contributed to the grand bargain to spin off the DIA from the city of Detroit and support the city’s pensions during its bankruptcy — provided $1 million in grants to help fund a brand awareness campaign for the museum, said Christine Kloostra, executive director of marketing and communications for the DIA. See DIA on Page 18

Big Boy’s new owners hit bumps, move forward BY ANNALISE FRANK

More than a year after its sale to a group hopeful for a comeback, the Big Boy restaurant chain is cooking up new locations and deals. But the year hasn’t been without some strife. Local investors bought the 84-year-old restaurant company’s assets in October 2018 from longtime businessman Robert Liggett, who has since died. They have paid off $34 million in debt that was owed by the once-bankrupt chain, revamped menus and launched a new fast-casual concept. And as of Jan. 1, Southfield-based Big Boy Restaurant Group LLC has a new CEO, co-owner and board chairman Tamer Afr, after it parted ways with David Crawford in the fall. Re-energizing Big Boy — iconic

but now a fraction of its former self — was never going to be easy. It is down to 77 locations from 149 in 2009. The group has four new Michigan restaurants in the pipeline: two multi-tenant developments at the Pasquale’s restaurant site in Royal Oak and in Fraser for a collective $10 million, as well as new restaurants in Okemos and Muskegon. Plus, a Grosse Pointe Woods location closed by a fire more than a year ago is planned to reopen. Afr, managing partner of Southfield-based A&A Management and an owner of the Fraser Hockeyland ice arena, said Big Boy sales have improved over last year. He declined to disclose figures. See BIG BOY on Page 20

A giant Big Boy statue is on display at Big Boy Restaurant Group LLC’s prototype fast-casual location in Southfield. | ANNALISE FRANK/CRAIN’S DETROIT BUSINESS JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 3

REAL ESTATE INSIDER

It’s hard to find vacant, usable industrial/warehouse space in southeast Michigan, so many developers are building new buildings for users like Amazon, which operates in this Livonia facility that opened two years ago. | LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

Industrial market continues to be bright spot in Detroit area real estate

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The region’s industrial space vacancy rate ticked up 0.1 percentage points to 4.1 percent as 1.5 million square feet of speculative space came online, acKirk cording to a new PINHO fourth-quarter report from Newmark Knight Frank. The report also says that rents continue their upward trajectory, increasing to $5.99 per square foot in Q4 from $5.86 per square foot in Q3. They were $5.56 a year ago in metro Detroit’s approximately 390 million-square-foot industrial market. “The positive performance of newly completed speculative developments and continued groundbreaking for build-to-suit facilities are indicators that (the) Metro Detroit industrial market remains strong,” the report says. Industrial real estate for years has been considered one of the bright spots in Detroit area real estate as the auto industry’s health has propelled business for manufacturers and others in the region. “At this moment in time, occupancies remain incredibly strong, and I don’t see anything that would suggest things are about to change for the worse, other than it’s lasted so long it’s almost too good to be true,” said Peter Burton, principal of Bingham Farmsbased developer Burton-Katzman LLC. “All of our buildings are full and they rarely go empty, and if they do go empty, they fill up almost immediately.” The region’s two largest industrial submarkets, Macomb County and southeast Oakland County, have vacancy rates of just 3 percent and 2.3 percent, respectively, according to the Newmark Knight Frank report. Macomb County has 82.75 million square feet with rents of $5.28 per square foot for general industrial space, $6.47 per square foot for warehouse/distribution space and $7.19 per square foot for R&D/flex space. In southeast Oakland’s 87.24 million square feet, general industrial is $5.87 per square foot, warehouse/distribution is $5.99 per square foot and R&D/ flex is $9.03 per square foot. The report says that 113 industrial projects totaling 18.5 million square feet have been completed in the last five years.

Riverfront buildings, land for sale for $18 million 800.456.3824 fishbeck.com

4 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

A longtime Detroit property owner is asking $18 million for a group of Detroit riverfront properties. Penny De Vaull says this is the first

The above building at 1964-1974 Franklin St. is part of a five-property portfolio listed for sale for $18 million. | COSTAR GROUP INC.

“MY VISION WAS TO DO LIKE A DOWNTOWN BIRMINGHAM BUT I KNEW I NEEDED ENOUGH PROPERTY.” — Penny De Vaull, Detroit property owner

time she has listed her five-property portfolio that includes buildings totaling about 48,000 square feet and 1.15 acres of land at 1969 Franklin St.; 1964-1974 Franklin; 2013 Franklin; 271 St. Aubin St. and 2000 Woodbridge St. She said the price tag comes from seeking $200 a square foot for the 48,000 square feet of building space ($9.6 million) and the land (about 50,000 square feet, or $10 million), which is based on the $194 the former Woodbridge Tavern next door to her buildings at 289 St. Aubin St. sold for in January 2019. The new owner, Acceptance LLC, which is registered to Howard Hanson III in Detroit, paid $600,000 for it a year ago, according to CoStar Group Inc., a Washington, D.C.-based real estate information service. (By comparison, Dan Gilbert paid $41.74 per square foot for 2.75 acres, or 119,790 square feet, of vacant east riverfront land in November 2018. In September 2018, a New York Citybased real estate investor paid $2.125 million, or $75.89 per square foot, for the Elevator Building at 1938 Franklin St.)

De Vaull said she began assembling the properties three decades ago when she was trying to develop the area. “My vision was to do like a downtown Birmingham but I knew I needed enough property. I started acquiring and assembling in that area to get a big enough footprint. Just as I was starting to rehab one building on the corner of St. Aubin and Franklin, they announced the casinos” on the Detroit riverfront, she said. “I stopped my plans for that when they announced casinos are coming because it wouldn’t make sense to go forward with my plan if they were buying out the area. My dream was really being thrown out the window.” The city had planned casinos on the riverfront but abandoned that plan about two decades ago. De Vaull said one of her buildings, 1964-1974 Franklin, had been used by the notorious Purple Gang. She said previous longtime owners and families in the area had told her of the gang’s use of the building during Prohibition a century ago. However, a history of the building compiled for the East Riverfront Framework Plan says that it was built in 1907 and was originally used for the Pressed Steel Sanitary Manufacturing Co. Eventually, it was used by Studebaker Corp. Valyncia Page and Justin Cain with Front Page Properties have the listing on the portfolio. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

TRADE

Feds refuse a salvage cut to save Michigan’s cherry industry Government won’t put tariffs on Turkish imports, says Michigan farmers aren’t threatened BY DUSTIN WALSH

The mood of Michigan’s revered cherry farmers turned sour at the Grand Traverse Resort last week. The attendees of the Northwest Michigan Orchard and Vineyard Show and the Cherry Marketing Institutes’ annual meeting received word that’ll surely be a death sentence for some of their farms. On Jan. 14, the U.S. government ruled it would no longer implement countervailing tariffs against dried tart cherries from Turkey, the world’s largest producer. “We’re shell-shocked,” said Michael DeRuiter, vice president of DeRuiter Farms Inc. in Hart, 38 miles north of Muskegon. “We had a clear dumping case with just unbelievable data to support our case. We’ve gotten zero help out of (Washington) D.C. The system has failed our industry. Now we’re left to pick up the pieces from the lack of support at literally every level ... if we can survive.” Michigan’s $50 million cherry industry, which produces about 70 percent of the nation’s cherries, has been rotting for years, drowned by a string of rainy seasons, an infestation of an invasive vinegar fly species called the spotted wing drosophila and a wave of cheaper imports. “It’s a difficult time to be a grower in Michigan,” said Audrey Sebolt, horticultural and industry relations specialist for the agriculture trade group Michigan Farm Bureau. “Growers are worried, not if their kids will be able to take over the family business, but if they will be able to continue to farm their acreage.”

DeRuiter Farms in Hart using a cherry shaker to harvest its annual crop. | MICHIGAN FARM BUREAU

Cherry Trade Committee. Turkey’s dumping of cherries into the market caused commodity prices to drop below input costs, said Don Gregory, chairman of Shoreline Fruit and Cherry Bay Orchards, which farms 3,000 acres of apples and cherries in Suttons Bay and Hartford in Southwest Michigan. “There’s no question the tart cherry industry is in a tougher spot than it’s been in 25 or 30 years,” Gregory said. The local industry received favorable news when a Commerce Department and ITC investigation concluded in September 2019 that Turkish exporters sold dried tart cherries at values 541 percent to 648 percent lower than domestic rates and were subsidized at more than 200 percent the cost of production from the Turkish government. Turkey exported its dried tart cherries for 89 cents per pound, compared to the roughly $3.50 per pound Michigan’s cherry farmers were selling their product wholesale, the investigation concluded. The ITC originally supported the Commerce Department’s findings and implemented a 205 percent tariff on dried cherry imports. But that only amounted to a roughly 5 cent penalty, far below the Turkish subsidies discovered by the federal investigation. But the government’s help lasted barely longer than the eight-week tart cherry growing season. Last week, the ITC reversed its decision to implement tariffs in a surprise 5-0 vote on the issue, determining that industry “is not materially injured or

Jive Turkey? Dried tart cherry imports from Turkey rapidly rose to 686 tons in 2018 from just 188 tons in 2016, according to the International Trade Commission, driving down domestic prices and harming Michigan’s farmers. The Dried Tart Cherry Trade Committee, which consists of four Michigan cherry processors, filed petitions in April 2019 with the U.S. Commerce Department and International Trade Commission seeking trade action against Turkey after years of declining domestic prices. The group alleged Turkey was flooding the U.S. market with dried tart cherries, often called dumping, well below the market rate due thanks to generous subsidies from its government. Traverse City’s Shoreline Fruit LLC, Frankfurt’s Graceland Fruit Inc., Cherry Central Cooperative of Traverse City, Smeltzer Orchard Co. of Frankfort and Payson Fruit Growers Co-op of Payson, Utah, make up the Dried Tart

threatened with material injury by reason of imports of dried tart cherries from Turkey.” An explanation from the trade committee will not be published until Feb. 18. After that, cherry producers could file an appeal or can refile a new case against Turkey if continued evidence of alleged dumping and subsidies that violate World Trade Organization guidelines subsist. DeRuiter expects Turkey to up its tart cherry production following the ITC ruling, putting further strain on farmers’ balance sheets. “I fully expect them to intensify (exports),” DeRuiter said. “Everyone has had negative revenue streams for a few years now. There’s a point where we’re just wasting money on crop insurance. Then it’s time to close shop.”

A bitter bloom Michigan’s cherry industry is already rife with casualties. Between 2006 and 2018, 160 cherry farms across the state shuttered with 44 of those occurring in Grand Traverse and Leelanau counties, according to USDA data . The warm, humid summer in 2019 compounded issues for tart cherry farmers, as the invasive spotted wing drosophila invaded cherry fields in record numbers. Michigan State University Extension monitors the insects, whose maggot-like offspring feed internally on the fruit’s flesh, via traps. Traps with the species present were as high as 98 percent during the 2019 cherry growing season, up from below

30 percent in 2018. However, Michigan cherry growers have largely maintained tart cherry acreage despite the dropping prices and infestation, according to USDA data. Tart cherry acreage dropped to 30,500 acres in 2018 versus 32,500 in 2014. Though Sebolt warns that much of those acres may not have been harvested or abandoned. The Farm Bureau estimates that 30 percent of the Northern Michigan cherry crop was not harvested due to the infestation. “(The spotted wing drosophila) love heat and humidity and 2019 was the worst year on record by almost 10fold,” Sebolt said. “As acreage is being abandoned (from poor pricing), the spotted wings are still infesting these orchards, increasing the damage for everyone else. Much like what’s happened in Florida for citrus growers, it’s creating larger problems.” Florida’s orange growers have been devastated by the spread of citrus greening disease, which is caused by a bacteria transmitted by the citrus psyllid insect. Upward of 90 percent of the state’s groves are infected with the disease, reported the Washington Post.

Beltway brush-off Despite an administration amenable to trade squabbles, which included $26.5 billion in payments to farmers last year who were harmed by retaliatory tariffs from China, the state’s cherry industry has struggled to get the attention of the White House.

The cherry industry was not eligible for the trade-adjustment payments from the U.S. Department of Agriculture last year. “Since tart cherries are an import problem, we get no legislative action,” DeRuiter said. “Everyone is very supportive, but nothing concrete ever materializes even though we’re close to losing our industry.” Trade troubles aren’t limited to Michigan’s cherry industry either. The state’s $20 million asparagus industry alleges Mexico and Peru flood the U.S. market during the farmers prime season in May and June. “Because of their climate, they can grow year-round, but for the last two or three years, the amount of asparagus coming from Mexico and Peru during our seven-week season has increased,” said John Bakker, executive director of the Michigan Asparagus Advisory Board. “The prices being offered are well below what the U.S. industry can produce them for.” The asparagus growers — approximately 100 farms cultivating just under 10,000 acres — has suffered up to a 30 percent drop in prices in the past five years, Bakker said. The industry has been closely watching the tart cherry industry’s battle against Turkey, in hopes of moving forward with their own case against Mexico and Peru. But that plan exploded with the ITC ruling, Bakker said. “There was a good deal of enthusiasm that they were likely to prevail, so we were looking at it very carefully,” Bakker said. “That’s off the table now. It would give anyone pause knowing that cherries had one of the best cases (of dumping) that I’m aware of, and I’ve been following these issues for years and years, and lost. They had a case they couldn’t lose.” Instead the industry will increase its marketing efforts to make consumers more aware of where the asparagus they buy is grown, Bakker said. Gregory said tart cherry farmers have to focus on surviving. “Everyone is at least aware of what’s going on now,” Gregory said. “We’ve been through bad times before and there’s always some shakeout in the industry. I don’t know who the players are that are going to be left standing at the end, but I think this has given us a better understanding of the market. We’ve lost some customers, but we’re adapting and we’re trying to figure out where cherries can have niche markets. We have to keep going. I’m always looking for the pony in the manure pile.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

CRAIN’S NEWS

Crain’s names new reporter, adds coverage areas for 2 others

BY CRAIN'S DETROIT BUSINESS

Crain’s Detroit Business has added a new reporter who will cover finance and technology. Nick Manes, 35, worked for seven years as a reporter at MiBiz in Grand Rapids covering economic development and real estate. Most recently, he was a reporter and editor at Mich-

Manes

6 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

Frank

Nagl

igan Advance. Manes’ coverage areas will include venture capital and private equity, banking and technology topics including biotech. Manes is a Grand Rapids native.

In addition, two other Crain’s reporters have added coverage areas. Annalise Frank will cover the city of Detroit, including city government and neighborhood redevelopment and business. Frank, 27, has worked for Crain’s for three years covering general assignment topics. Kurt Nagl, 27, will add coverage of higher education and sports business

to his portfolio. He has also been a general assignment reporter at Crain’s for three years. “These changes will help Crain’s add depth in coverage areas that readers have identified as important,” Managing Editor Michael Lee said. “They will help us extend the smart and informative reporting that we aim for every day.”

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COMMENTARY

The case for a fuel tax increase instead of tolling BY JIM BURG

Mchigan Sen. Peter Lucido, R-Shelby Township, speaks at a Aug. 29 hearing of the Senate Judiciary and Public Safety Committee, which he chairs. | MICHIGAN SENATE

COMMENTARY

#MeToo moment arrives at Capitol with Lucido outrage The Michigan Legislature is about to have an overdue #MeToo movement reckoning. Workplace sexual harassment under the Capitol dome got national attention last week when a female journalist at the Michigan Advance news website published a first-person account about how state Sen. Peter Lucido made a sexually suggestive comment about her in front of a group of teenage boys from De La Salle Collegiate, an all-boys Catholic high school in Warren, at the Capitol on Tuesday. Senate Majority Leader Mike Shirkey, R-Clarklake, and Senate Democratic Leader Jim Ananich of Flint asked the Senate Business Office to investigate Lucido, a Shelby Township Republican, for allegations of sexual harassment. Allison Donahue, a 22-year-old reporter, THE UNITED Wednesday PRONOUNCEMENT reported that she approached Lucido in the hallway CONDEMNING of the Capitol on TuesSEXUAL day to interview him about why he was preHARASSMENT viously following a WAS LONG Facebook group that Detroit Metro Times OVERDUE. reported was advocating violence against U.S. Reps. Rashida Tlaib and Elissa Slotkin. Donahue said Lucido, 59, asked her in front of the group of male high school students if she had “heard of De La Salle.” “I told him I hadn’t,” Donahue wrote. “It’s an all boys’ school,” Lucido told Donahue. “You should hang around! You could have a lot of fun with these boys, or they could have a lot of fun with you.” Lucido initially didn’t deny he made the comments to Donahue, while trying to downplay the meaning of “have a lot of fun with you.” “I apologize for the misunderstanding yesterday and for offending Allison Donahue,” Lucido said Wednesday in a one-sentence statement. Lucido later alleged to WDIV-TV in Detroit that he had been misquoted. Lucido said he told Donahue “we’re going on the (Senate) floor to have some fun. You’re welcome to join us.” Shirkey and Ananich were not satisfied with Lucido’s response and took the unusual step of publicly calling for an investigation of a fellow senator.

Chad

LIVENGOOD

“Sexual harassment has no place in the Michigan Senate,” Shirkey and Ananich wrote. “We take these allegations very seriously and trust you will take appropriate action to resolve the matter.” It was not clear what type of punishment could be levied. The united pronouncement condemning sexual harassment from the male Republican and Democratic leaders of the Senate was long overdue for an untold number of female legislative staffers, who have privately complained for years about the behavior of male lawmakers and staffers. On Wednesday, they went public in response to Lucido’s comments. “The legislature is not a safe space for women, & until there are real consequences for the sexism & misogyny displayed it will continue to feel degrading to work here,” tweeted Molly Korn, chief of staff of state Sen. Mallory McMorrow, D-Royal Oak. “Sen. Lucido should be stripped of his chairmanship. The only way to stop the abuse of power is to take it away.” Lucido is a Macomb County attorney who spent a small fortune to get elected to the Legislature and has recently been talking about running for governor. He chairs three Senate committees. Anyone who knows Lucido was not surprised by this allegation. His later denial notwithstanding, it sounded exactly like something he would say. With Korn and others starting to speak out about the working environment for women in the public institution that writes Michigan’s workplace laws, it stands to reason that more allegations will come out about lewd and demeaning behavior by men in power in Lansing.

MORE ON WJR ` Listen to Crain’s Group Publisher Mary Kramer and Managing Editor Michael Lee talk about the week’s stories every Monday morning at 6:15 a.m. Mondays on WJR 760 AM’s Paul W. Smith Show.

In the Jan. 13 issue of Crain’s Detroit Business, the lead story asked, “The Case For Tolls?” After years of study and discussion within the trucking industry and other groups, here is my opinion for why there is NOT a strong case for Jim Burg is the founder of James tolls. Not many people arBurg Trucking in Warren and gue Michigan and the nacurrent co-chair tion are in need of new of the American funds for repairs and new Trucking designs to reduce conAssociations’ gestion and improve Infrastructure safety. It’s the method for Funding Task collection which is in disForce. pute. The most efficient and effective method for collecting highway user fees is through the fuel tax. It is non-evasive, immediate and conservative. And it’s already in place. Increase the fuel tax today, and money will be in the coffers in 10 days. Not the time it will take to approve, select contractors, create a collection network, and install gantries and transponders. There are unique projects where tolls make sense: long span bridges, tunnels, new capacity and other high cost projects. The trucking industry represents about 13 percent of all vehicles on the road, yet pays nearly 50 percent of the Highway Trust Fund deposits. And we are willing to pay more. However, we want the most efficient road user fees to pay for road costs. For truckers, administering tolls costs over 18 percent of the actual tolls. Administering diesel taxes costs less than 3 percent. All of which are borne by consumers or manufacturers. Toll rates for automobiles are in the neighborhood of 4 to 10 times the current gas tax rate. In the extreme case, I-66 near Washington, D.C., charges a peak congestion price of $46 for a 10-mile drive. Yep, $4.60 per mile. Even if the gas tax was $2 per gallon, the same trip would cost $1. The Chicago Skyway charges $5.60 for seven miles or 80 cents a mile. Using the same $2

LETTER TO THE EDITOR

Michigan needs to lead way in wages, benefits TO THE EDITOR: I first met Lou Glazer nearly 40 years ago, and I will never come close to his intellectual and analytical abilities. His Jan. 13, 2020, opinion piece hit the ball out of the ballpark. The other day, I heard President Donald Trump’s top economic adviser say life is good and wages for working people are rising — but upon deeper review these improvements are due to minimum wage hikes in

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. 8 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

per gallon in gas tax, this trip would cost 60 cents. Drive from Farmington to Detroit or Sterling Heights five days a week for a year at the Chicago Skyway rate and the cost becomes $9,600 per year. A 20 cents-per-gallon increase in the fuel tax would cost the average commuter about $100 per year. Diversionary routes will become a fact. With secondary routes already congested, further shortcuts will include neighborhoods. Time for taking alternatives will be dramatically increased. Safety will suffer. More crashes and injuries will occur on roads not designed for increased volumes. Collection fraud will be significant. This is what we would get with toll roads. Maybe I’m giving the extreme versions. But, how do we know this won’t happen here like it has in other cities? Some support a Vehicle Miles Traveled fee, but that’s not ready for prime time. It needs to be designed, tested and secure. Alternative fuel vehicles are currently 1 percent of all vehicles on the road. They are mostly cars, and user fees could easily be collected with registration fees until VMT is proven out. It will be 10 years until alternative-fuel vehicles are THE MOST relevant. In the EFFICIENT AND meantime, collect at the pump. EFFECTIVE Much of any increase would be the METHOD FOR replacement of tax COLLECTING reductions due to a flawed formula. If HIGHWAY USER fuel taxes were in- FEES IS dexed to increasing CAFE (Corporate Av- THROUGH THE erage Fuel Economy) FUEL TAX. standards and road building/maintenance inflation 25 years ago, we would not be in such dire straits. The cost of doing nothing to improve our nation’s roads has increased to $300 billion per year; $120 billon for congestion, $100 billion for damages to our cars and $80 billion for crash injuries. We are already paying these costs. They will increase if motorists don’t accept the fact that we need to pay more to get more. Then all we will need are courageous politicians to do the people’s business.

Michigan and states across the country. Even with such increases, people still can’t live the quality life we took for granted in the 1970s. Employers need to pay our residents a decent wage, with decent benefits. Decent wages mean that more families can afford a decent education for their children and can save a decent pension. Michigan needs to be in a race to the top of the nation’s economic ladder, not the bottom. Bob Morris author, “Built in Detroit”

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

LETTER TO THE EDITOR

Look to conflicts in Wayne State board mess

Don’t forget these skyscrapers

BY DWIGHT MONSON

As one who recently worked closely with the leadership of Wayne State University and its School of Medicine for 3½ years, I want to share an perDwight Monson informed spective on the inis a business ner workings of consultant who the WSU Board of worked for Governors. Wayne State on I continue to be a proposed partnership with disappointed by the unrelenting Henry Ford efforts of a board Health System faction to oust that was President M. Roy canceled last Wilson, especially year. when much of this appears to be driven by personal agendas and ineptness. In early 2016, Dr. Michael Busuito was removed as board chair of WSU Physicians Group. While not involved in that decision, I can speak with first-

hand knowledge that this action was Wilson’s administration. In addition, justified for multiple reasons, includ- she is a faculty member of the Univering his presiding over the largest oper- sity of Michigan, a competitor to WSU’s School of Medicine. While not ating losses in UPG’s history. familiar with all Less than one of the particuyear later, Dr. BuI CONTINUE TO BE lars, it would suito was elected appear Thompto the WSU board. DISAPPOINTED BY THE son may have a It would appear he came with a UNRELENTING EFFORTS OF personal conpersonal vendetta A BOARD FACTION TO OUST flict of interest in objectively to punish those evaluating the involved in his PRESIDENT M. ROY president’s perouster. WILSON... The employformance. Sandra Hughes O’Brien was sinment contract of Dana Thompson’s husband was not renewed by a gled out by the Higher Learning ComWSU-sponsored organization during mission, the accrediting organization

for U.S. universities, for repeatedly overstepping her position on the board and intruding inappropriately into management. I saw many instances of this and agree with the HLC’s findings. As we approach a new election cycle, I hope Gov. Gretchen Whitmer and others charged with screening and vetting candidates to sit on state boards will do a better job of identifying individuals who understand their role as board members and respect the role of management, as well as those whose objectivity might be compromised by personal agendas and possible conflicts of interest.

It’s not unusual to hear a little hyperbole where Dan Gilbert is concerned, but Crain’s served up a real whopper in stating that his tower on the Hudson’s site would be the first “skyscraper” in Detroit since the Renaissance Center in the 1970s (“Decade of Dan,” p. 21, Jan. 6). On behalf of One Detroit Center (43 stories, 1993) and 150 West Jefferson (26 stories, 1989), I must protest. Neither of these buildings match the RenCen in height or mazelike mass, but they are no less deserving of the “skyscraper” label. Joel Batterman Detroit

Meet Jeff. He’s good for business and great for morale. Since earning his degree in sales and marketing years earlier, Jeff Hoekstra

FINANCE

had played successful roles at Dominion Systems and Capital One Bank. He

Michigan VC investments increase to $771.6M

believed that knowledge is power, but that knowledge without action is useless.

BY TOM HENDERSON

Michigan shattered its previous record for venture capital investment in 2019, according to the Washington-based National Venture Capital Association and PitchBook. A total of $771.6 million was invested in state companies last year, up $265.1 million, or more than 53 percent, from the previous record $506.5 million set in 2015. It was also a record nationally, with $136.5 billion invested in U.S. companies, surpassing the record of $130.9 billion set in 2018.

“THERE HAVE BEEN A LOT OF PEOPLE IN MICHIGAN WORKING FOR A LONG TIME TOWARD THE GOAL OF HAVING THE TYPE OF YEAR THAT WE HAD IN 2019.”

We had heard great things about Jeff, so when a business development position opened on our retirement plan team, we encouraged him to apply. He did so, never imagining the deep dive character assessment and 18 interviews ahead. Greenleaf Trust doesn’t hire just anyone, you see. Jeff ’s interview process confirmed that Greenleaf Trust takes its culture seriously. Our core values of “putting clients’ interests first, being honest and honorable, and doing the right thing always” were in sync with Jeff’s own philosophy of ensuring customer success. Long story short, Jeff accepted our offer without countering; a first for him. With Jeff onboard, get ready to be asked about your company’s retirement plan. And be ready to hear that Greenleaf Trust’s full fiduciary responsibility, robust investment platform, and comprehensive employee education will make your plan better, and your employees better off. As Jeff might say, that’s good for business and great for morale. You can learn more, and meet Jeff for yourself, by calling (248) 251-3401.

— Chris Rizik, CEO and fund manager, Renaissance Venture Capital

“There have been a lot of people in Michigan working for a long time toward the goal of having the type of year that we had in 2019,” said Chris Rizik, the CEO and fund manager at Ann Arbor-based Renaissance Venture Capital, a fund-of-funds that invests in national VCs willing to do deals here. As it does every year, California ranked No. 1, with $63.7 billion invested in 3,623 deals. New York was second with $27.1 billion invested, followed by Massachusetts, $10.8 billion, Washington, $3.8 billion, and Texas, $3.7 billion. Michigan ranked No. 21 overall.

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JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 9

WORKFORCE TRENDS

WHEN TECH JOINS THE TEAM Michigan will be more impacted by AI and automation than most states. Are we ready?

BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS

Talk of how automation and artificial intelligence would change the workforce once conjured images of robots taking our jobs. But so far, the robots have not replaced humans on the factory floor — or the cubicle row. Automation has taken over some tasks, particularly repetitive ones, but it hasn’t exactly reduced the number of employees businesses need. In many different industries and job functions, automation and AI are making work easier and more efficient — in some cases driving growth that’s spurring companies to hire more people. But are metro Detroit and Michigan businesses ready for the massive transformation these technological advances will bring to every sector? A recent Brookings report on AI said that, while automation affects mainly lower-skilled, blue-collar workers, AI is likely to affect mostly higher-skilled, white-collar workers. The researchers tracked the top verbs used in AI patents, and they were: recognize, predict, detect, identify, determine, control, generate and classify — suggesting that these are the types of tasks that AI is most likely to take over. Among the jobs that are on track to be impacted by AI are market research analysts and marketing specialists, sales managers, computer programmers and personal financial advisors, according to the report.

10 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

“AI HAS THE POTENTIAL TO DISRUPT EVERY SINGLE PROCESS THAT COMPANIES TEND TO CAREFULLY DESIGN AND OPTIMIZE TO CARRY OUT THEIR WORK. THIS HAS HUGE RAMIFICATIONS ON THE SUITABILITY OF (THE) EXISTING ORGANIZATIONAL ARCHITECTURE OF COMPANIES.” — Tom Kelly, Automation Alley CEO and executive director

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NOMINATIONS

Moreover, Michigan is among the states most likely to be heavily “exposed” to AI, given its robust manufacturing sector, the report concludes. That doesn’t mean jobs here are going away, but they could change dramatically in the near future. Because Detroit is a union town, people may fear that embracing automation and AI will mean eliminating jobs, said John Jurewicz, innovative technology leader at Walbridge. “People think there’s all this reticence, but there’s not,” he said, explaining that companies are using automation and AI to enhance their workforce and increase productivity.

OPEN

Automation, AI at work Automation goes beyond robots on the assembly line, and AI is being used in a wide range of tasks and job functions — and across a range of industries. On the factory floor, robots are taking over some repetitive tasks, said Automation Alley CEO and Executive Director Tom Kelly. “But the thing that people need to understand about that equation is that the robot usually takes a portion of a job, so that worker ends up doing something else that’s more valuable,” he said. “Companies that automate tend to add people — they don’t tend to reduce people.” See AI on Page 12

Crain’s Detroit Business will name the 2020 Notable Women in Finance in a special report on April 27. In that report, we’ll profile women in finance – from controllers and CFOs to money managers and number gurus – who are considered leaders in their workplaces and the community. NOMINATIONS CLOSE: FEB.7

For more information or to nominate, visit crainsdetroit.com/nominate JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 11

FOCUS | WORKFORCE TRENDS

How well do you know your workforce? Understanding employees key to productivity BY ALLISON TORRES BURTKA SPECIAL TO CRAIN'S

Automation and AI will change the nature of work, said Automation Alley CEO and Executive Director Tom Kelly. “You may not have a person in every truck driving on the highway, but you’re still going to need all kinds of people in logistics,” he said. “There’s going to be more work to be done, but it will be different work,” and it’s hard to predict what it will be. Understanding employees better may help businesses determine who should be doing what — and how a person can contribute the most value as automation and AI start to do more, said John Healy, vice president and managing director of Kelly Outsourcing and Consulting Group for Kelly Services. How do you do that? Companies use advanced methods, including AI, to understand their customers and to personalize and tailor their experience, but “why don’t they utilize those same tools to understand their employees with the same reverence?” Healy suggested. “Do you understand your employees at the same level that you understand your consumers? There’s a big ‘a-ha’ moment coming for a

lot of organizations, as they look to understand what will best motivate and engage their workforce,” he said. “I’m seeing companies really beginning to make strides in understanding their workforce with the same passion and energy as they understand their consumer,” Healy said. “And that will help them use automation and AI to their advantage, and to benefit their workforce.” As Quicken Loans aims to improve its processes, the company considers: “How can we make things that make customers’ process with us easier, more seamless — and make a better experience for them, so they’ll want to do business with us?” said Chief People Officer Mike Malloy. But they take the same approach to their workforce, he said: How can they make their team members’ work more seamless and easier for them to serve clients? Quicken has also adopted a less rigid approach to which team members should be doing what. For example, an internal team called Thrive helps team members assess how their skills might translate to other roles and helps them develop the soft and hard skills they need to get there, Malloy said.

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12 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

From Page 10

In construction, Walbridge uses automation in both simple and complex ways, Jurewicz said. One example is exoskeletons that help workers with repetitive tasks. “We’ve been testing them to help workers as the workforce ages,” he said. “Lifting and drilling with a heavy rotor hammer will tire you out really quick — even healthy, strong people. So an exoskeleton assist can increase productivity and reduce fatigue dramatically.” Walbridge’s use of both automation and AI is “centered mostly on productivity and safety,” Jurewicz said. AI is helping companies improve and enhance what they do. Through predictive analytics, businesses can “focus more on hypotheses and what trends and patterns to look for — that, historically, you may have needed a statistician to really dig into things and work through,” said John Healy, vice president and managing director of Kelly Outsourcing and Consulting Group for Kelly Services. Now, “the amount of time it takes to do some of that deep analysis has gone away and allowed us to get into recognition of patterns quicker. And that recognition allows you to make better decisions.” In construction, for example, AI can “look at all the patterns in a heavy occupant construction environment, where computer vision is looking at the trajectories of all the workers all at once,” Jurewicz said. “It gives you more intelligence, just like a pilot before takeoff looking at crosswinds,” Jurewicz said. Quicken Loans has used automation and AI to make its processes more efficient. “Our mortgage bankers are incredible at helping our clients achieve their dreams, but, prior to some automation, they had to spend too much time inputting data into the system,” said Mike Malloy, the company’s chief people officer. “What we’re seeing is that our team members can add the most value for our clients when they’re doing the things that they’re best at — forming relationships, exercising judgment, problem solving,” Malloy said. By letting team members focus on those things and letting computers run repetitive tasks in the background, the company has become more efficient, “which has led to the incredible growth we’re seeing, which has allowed us to continue to hire more and more and more people.” In 2015, Quicken launched Rocket Mortgage, its online mortgage experience, which allows home buyers to go through the entire mortgage process on their own, though they can also connect with a mortgage banker via online chat, email or phone if they have questions. Rocket Mortgage uses both automation and AI. At the time, some people said Rocket Mortgage meant Quicken wouldn’t need mortgage bankers anymore, Malloy said. “It was exactly the opposite of the truth. We’ve grown our mortgage banking force enormously,” Malloy said. A 2018 World Economic Forum report estimated that 75 million jobs may be displaced by a shift in the division of labor among people, machines, and algorithms — but 133 million new roles may emerge because of it.

Room for improvement Automation and AI are more advanced in some sectors than others.

Kelly

Malloy

Some organizations that have incorporated automation only to reduce costs have struggled, Healy said. “If you have a really bad process and you automate it, then you do a really bad thing fast.” “If you’ve ever gotten into one of those loops on a phone tree that’s supposed to be answering your questions, or a chat bot that is not really optimized,” the company may be cutting costs but also alienating clients, Malloy said. “To me, the key thing to do is to focus on the needs of your clients.” Organizations that have engaged automation as a way to think differently have seen some stronger advances, Healy said. He pointed to Henry Ford’s revolutionary assembly line concept as a historical example. “It wasn’t technology for the sake of technology. It was using that technology with the wisdom to look at a process and say, there’s a better way of doing things.” Kelly noted that a recent Automation Alley survey of Michigan manufacturers about advanced technology adoption in southeast Michigan showed that people viewed AI as something they need to keep an eye on, “but it’s not something they have moved on yet. They haven’t done much with it yet. They say, ‘I know — but I don’t know what I should be doing,’” he said. “Michigan is behind in terms of how we’re embracing what we call industry 4.0 — this fourth industrial revolution,” Kelly said. “Because we invented the third industrial revolution, which was defined by Henry Ford and the assembly line that changed how manufacturing was done, all of the assets we created were built around the third industrial revolution.” So coming out ahead in the fourth revolution will require some big changes, he said. Some Automation Alley companies have been using AI for things like forecasting, radiological screening, predictive modeling and studying customer behavior — but “those are evolutionary, incremental projects to solve a specific pain in business model as it is today,” Kelly said. Instead, companies should be thinking much more broadly — about “what is the business model that’s going to sustain you over the next 30 years?” he said.

Redefining jobs As companies incorporate more automation and AI, rethinking the distribution of work can be a challenge. Healy said, “It’s become very difficult to understand: What do I do if I remove 30 percent of the tasks for you because I automate them?” In some cases, this is relatively simple: If a person is spending time on repetitive tasks like data entry that get automated, that person has more time to devote to the more essential parts of their job, like serving customers in person. But in other cases, it may not be as simple as giving that person more of the work they already do. To make the best use of their skills, it might mean having the per-

son take on new tasks in a different area or function of the business. Job descriptions will change. “The biggest impact we’re seeing for organizations, if we break it down, is that it’s no longer about the job,” he said. Instead, it’s about the skills and tasks the person is performing, which of those can be automated, and which of those are most valuable for the person to perform. Another factor complicating this equation is that organizations using more automation and AI will need more people with 5G skills and natural language processing, Healy said. “The people who have those skills are in high demand, and there’s a low supply,” and companies are recognizing that the supply-demand equation has been flipped. So they are rethinking how they engage talent, and some are looking to temp labor or outsourcing solutions, he said.

New training needs Training workers how to use AI is sometimes simple — an extension of the training they already do. For more advanced AI technology, a full simulator — like a flight simulator — might be used, Jurewicz said, noting that some large equipment manufacturers provide these types of simulators. “Since modern AI has evolved in an open source and MOOC world, there are plenty of training and education resources available online and from firms that specialize in providing customized upskilling,” Kelly said. But getting workers up to speed on AI-related technology presents the same challenges that other training does: finding the bandwidth to make time for the training. But Kelly said the bigger issue is how to get employees to think differently in an AI-enabled organization. “AI has the potential to disrupt every single process that companies tend to carefully design and optimize to carry out their work. This has huge ramifications on the suitability of (the) existing organizational architecture of companies,” he said. “For example, checks and balances introduced to guarantee process integrity which is managed by humans might be unnecessary if in an AI-enabled process.” So workflow will need to be reengineered to collaborate best with the AI, and organizations might not be well equipped to do that. Big changes are in store for everyone. “The world going forward is so exciting if you’re a consumer. The things that you’ll be able to do, the life you’ll be able to lead, the quality of life that you will have — it’s going to be a wonderful time,” Kelly said. “If you are in a business and you don’t understand how technology is going to disrupt what you think you know about what your business model is — if you don’t understand AI, if you don’t understand 3D printing, if you don’t understand autonomous robotics — you are asking for a lot of trouble.” But for companies that do understand these technologies and prepare their workforce, these changes will be positive, Kelly said. “The work is going to change, perhaps more profoundly for white-collar workers, but the work will become more valuable, which rises all boats,” he said. “So companies make more money, employees make more money, there’s more need for employees — there’s more jobs that are going to be created because there’s more useful things we can do.”

OBITUARIES

MERGERS & ACQUISITIONS

Longtime automotive supplier executive, Lambert acquires New York-based company philanthropist Charles Becker dies at 72 With his brother, built father’s company to world-class stature BY DUSTIN WALSH

Former automotive supplier owner, investor and philanthropist Charles “Chuck” Becker died Jan. 10 from a neurodegenerative disease. He was 72. Becker’s father, Leonard, started the Sterling Heights-based Becker Group in 1954 when he opened Perfect Mold. Charles and his brother, Bruce, built the company to world-class stature, competing with larger, better-funded suppliers such as Lear Corp. and Johnson Controls Inc. Becker Group manufactured components for automotive consoles, sun visors, door panels and instrument panels. After a series of acquisitions, the company renamed itself the Becker Group in 1987. Charles Becker led the 1996 acquisition of Gebr. Happich GmbH, Europe’s second-largest maker of interior trim. Becker Group grew to more than 8,000 employees with 32 manufacturing plants on two continents and $1.3 billion in sales by the late 1990s. However, the company struggled to compete during an era of major supplier acquisitions as competitors Magna, Lear and JCI continued to get larger and were able to muscle Becker Group out of several major contracts, including Chrysler’s

next generation minivan that was set to debut in 2001. The increased competition led Becker to seek a buyer, which it got in 1998 when it sold to JCI in a Becker nearly $1 billion deal in the summer of 1998. A year later, Becker and his business partners bought back eight molding operations and two tool shops JCI deemed non-core operations and opened as Becker Group LLC in Sterling Heights. Charles and partners sold that company to Collins & Aikman Corp. for $80.5 million in 2001. Becker went on to found Troy-based Becker Ventures LLC, a private equity firm with investments in real estate, hospitality, health and industrial manufacturing. Its portfolio includes Chicago restaurant Free Rein, Chicago boutique hotel St. Jane Hotel and Chicago apartment building Mila. The firm is run by Becker’s daughters, Carrie Becker-Meghie and Jill Becker-Mast. He also served on the boards of Collins & Aikman, Metaldyne Corp. and TriMas Corp.

BECKER GROUP GREW TO MORE THAN 8,000 EMPLOYEES WITH 32 MANUFACTURING PLANTS ON TWO CONTINENTS AND $1.3 BILLION IN SALES BY THE LATE 1990S. Becker was an active donor to the Karmanos Cancer Institute, where he served as chairman of its board on two separate occasions. He also served as a board member at the Detroit Institute of Arts, Detroit Entertainment District Association and the Grosse Pointe Academy. Becker earned a bachelor’s degree from the University of Illinois at Urbana-Champaign. He is survived by his wife Michelle; children Beverley Becker, Carrie Becker-Meghie, Jill Becker-Mast, Charles Becker II and Elizabeth Becker; seven grandchildren; brother Bruce, and twin sister Martha Mehall. Funeral services took place last week. Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

Casteel Schoenborn is 7th acquisition for firm BY NICK MANES

Grand Rapids-based public and investor relations firm Lambert & Co. has acquired a New York banking and financial services communications company, the seventh acquisition in Lambert’s 22-year history. Lambert, with Lambert offices in Detroit, Grand Rapids, Lansing and New York City, said Tuesday that it bought 100 percent of the assets of Williamsville, N.Y.-based Casteel Schoenborn Investor Relations & Corporate Communications. Lambert founder and CEO Jeff Lambert said the deal bolsters the company’s presence in the world of investor relations, where it’s already ranked in the top 10 by national PR ranking service O’Dwyers. “What we get with this deal is some really seasoned IR practitioners and a strong client basis in financial services and it gives us the opportunity to expand our national IR practice,” Lambert told Crain’s in an interview.

“With financial services and community banking, it’s a great opportunity to dig deeper in those areas.” As part of the deal, terms of which were not disclosed, principals Lynn Casteel and Jeffrey Schoenborn will join Lambert as managing directors. Schoenborn echoed Lambert’s sentiments in an interview, saying the merger of the two companies gives Schoenborn added back-office muscle and will lead to the “building [of] a real financial services powerhouse.” As Crain’s reported in 2018, Lambert & Co. has been on an acquisition tear in recent years, and Lambert said he expects that to continue for the foreseeable future as the company has set a goal of one acquisition per year. Doing so, Lambert said, is requiring the company to turn toward more private equity financing for deals, as opposed to just banks. “It’s a pretty competitive market. We’ve seen an ample supply of capital in the lower-middle market,” Lambert said. “However, as we look at larger deals, it’s definitely pushing us to look at new capital sources.” Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

KEEPING TALENT IN MICHIGAN: Preparing our workforce for technological change PANEL DISCUSSION FEBRUARY 6, 2020 | 4:30-6:00 PM Join the College of Business as Murray Feldman of WWJ Newsradio 950 moderates a lively panel discussion among industry experts on how Michigan can reinforce its talent pipeline to meet the needs of the future. Free registration. Info at

umdearborn.edu/events/cob/talent

JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 13

WOMEN IN LEADERSHIP

‘I would love to see people treated as well as we treat our food’ Chef Sarah Welch

BY RACHELLE DAMICO | SPECIAL TO CRAIN'S DETROIT BUSINESS

Sarah Welch grew up between the United States and Jamaica. While spending her time as a 6-year-old in Jamaica, Welch often cooked meals with her neighborhood friends. “From a young age, I had an awareness that food has to be made and to be prepared,” Welch said. “It wasn’t something that just happens to you, because I think when you’re a kid [in America] adults are just always putting food in front of your face.” While working toward her business degree at Michigan State University, Welch worked as a dishwasher and a waitress at restaurant and bar Tavern on the Square. It was there where she first started as a line cook. “If somebody called off or didn’t feel like doing their job that day, they would have me come on the line,” Welch said. “Eventually, before I graduated from college, I was closing down the kitchen and I could work all the stations.”

14 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

The executive chef of Tavern convinced her to apply to the International Culinary Center, a renowned culinary institute in New York City. Welch was accepted and moved to NYC. “A bunch of really influential chefs graduated from there,” Welch said. “I thought it would be good networking, and it was.” Welch graduated at the top of her class and ended up working for an influential chef herself. As part of her curriculum, Welch worked for renowned British chef April Bloomfield at the Spotted Pig, a restaurant in New York known for its seasonal British and Italian fare. When her fellowship ended, Bloomfield offered Welch a position at The Breslin, a high-end gastropub in New York. But Welch missed home, and decided to move back to Detroit to pursue an opportunity working for chef Brian Polcyn at Forest in Birmingham. See WELCH on Page 16

“FROM A YOUNG AGE, I HAD AN AWARENESS THAT FOOD HAS TO BE MADE AND TO BE PREPARED. IT WASN’T SOMETHING THAT JUST HAPPENS TO YOU, BECAUSE I THINK WHEN YOU’RE A KID [IN AMERICA] ADULTS ARE JUST ALWAYS PUTTING FOOD IN FRONT OF YOUR FACE.” — Sarah Welch, chef

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WELCH

From Page 14

Welch grew from there, eventually becoming the executive chef at Republic Tavern in Detroit and later its sister restaurant, Parks & Rec. But after less than two years, Welch was dismissed from her positions. It didn’t take long for opportunity to show up. The next day, Welch bumped into Ping Ho, owner of The Royce wine bar in downtown Detroit. Ho was looking for a chef for her new butchery and restaurant, Marrow. “Essentially the second that I met her and we talked about Marrow, I knew I was in,” Welch said. Now, Welch manages a kitchen staff of 11 and is an equity partner at Marrow. She’s also helped form other Detroit-based ventures, including Detroit

`How did your childhood influence your career? My mom was a teacher and my dad was an entrepreneur who used to run Ann Arbor Realty. My parents traveled a lot when they were younger and fell in love with Jamaica. When I was 5 years old, my dad bought 300 feet of beachfront, built a resort and moved our family there part time. I grew up dinking around this resort

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The Children’s Foundation announced that Stacy Goldberg, MPH, RN, BSN, Founder and CEO of Savorfull and Jocelyn Hagerman, Founder of Goldberg SkyPoint Ventures and CEO of The Hagerman Foundation joined the organization as Trustees. The Children’s Foundation, an independent community foundation, Hagerman is the state’s largest funder dedicated solely to advancing the health and wellness of children. Goldberg’s work as a nationally recognized leader in nutrition and free-form healthy snacks will be of great value to the Foundation as nutritional health and wellness is one of five focus areas of the organization. Hagerman’s work as a philanthropist and community leader in Genesee County will benefit the board as the Foundation continues to expand.

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of person, place and thing in their food. I knew there would be a need for a butcher shop. The people that run the butcher shop are the best, most creative and dedicated artisans.

sake bar and restaurant Mink, where she is a partner. She’s also part of joint venture Nest Egg LLC, a female-led hospitality group, with partners Ho, Kiki Louya and Rohani Foulkes. Despite all of these ventures, Welch considers Marrow her baby. “We have this incredible protein that is sustainably raised as our muse, and that product dictates what I do,” Welch said. “It’s both liberating and grounding.”

Laura Picariello Reprints Sales Manager lpicariello@crain.com (732) 723-0569

Education: Michigan State University, bachelor of arts in hospitality business. Bachelor of arts in culinary studies, International Culinary Center (formerly known as the French Culinary Institute), New York City. Career ladder: While attending MSU, Welch began working as a line cook in 2009 at Tavern on the Square, a bar and restaurant in Lansing now known as Tavern & Tap. After graduation, Welch attended the International Culinary Center in New York and worked with April Bloomfield, the renowned chef of the Spotted Pig restaurant in New York. She moved to Michigan in 2010 to work as a line cook for chef Brian Polcyn at Forest Grill, a modern European restaurant in Birmingham now known as Forest. Welch worked her way up to sous chef at the upscale restaurant in 2012. After that, Welch worked as a sous chef at Italian restaurant Mani Osteria & Bar in Ann Arbor from 2012-2014. Next, Welch took a sous chef position in 2014 at contemporary American restaurant and bar Republic Tavern in Detroit under executive chef Kate Williams. When Williams left in 2015, Welch was promoted to executive chef of Republic. She opened sister restaurant Parks & Rec. as executive chef in 2015, a brunch spot in Detroit. She left her positions in 2017 and joined Marrow as executive chef shortly after. Current role: Executive chef and partner of Detroit-based restaurant and butchery Marrow. Partner of Mink, a sake bar and small plates restaurant in Detroit that opened in 2019. Partner of hospitality group Nest Egg LLC, a woman-led hospitality group that was formed last year. The joint venture includes partners Ping Ho, owner of Marrow and the Royce Detroit, and Kiki Louya and Rohani Foulkes, owners of Detroit-based brunch spot Folk. Mentors: Amanda Franke, Marrow’s general manager. Phoebe Zimmerman, Welch’s kitchen partner at Marrow. “They have made my food career in the past five years possible,” Welch said.

facility and spending a lot of time in the kitchen, because it was so interesting and intriguing to me. From that point, once I saw [the kitchen] come together and it was open and running, I knew I was going to be doing something in that realm. For the longest time, I actually thought I would be running the resort. That didn’t end up happening, but it got me off on that [business owner] trajectory.

people who was passionate about cooking at a young age. I was just passionate about traveling and eating. The cooking aspect came much later when I was in culinary school and I discovered I had a knack for it. I went into business because I had to and that led me to something that I’m really passionate about now.

`Did living in Jamaica influence your cooking? I think it influenced my awareness. I was a 6-year-old living in a small village, and you’re expected to make yourself breakfast, lunch and dinner. Initially, I got made fun of a lot for not being able to cook my own food. I learned to cook because if I was going to be hanging out with my friends, I needed to participate and be of help. When fisherman would catch fish off of the beach, my friends and I would cook it for dinner. We’d walk to pick up charcoal from charcoal pits that were a mile or two away, build a fire, get all the ingredients we’d need and cook the fish. I was aware from an early age that I had access to food and that there were steps required to make it.

`Tell me about the day you met Ping Ho and why you decided to partner with her. I met her the day after I left Republic. I literally ran into her at a coffee shop. She was a regular at Republic. She said, “I love your food, I heard what happened, and I’m so sorry.” We got to talking about what had happened. The idea of working under female leadership was appealing to me. While working at the Spotted Pig for April Bloomfield, I responded to a strong female presence really well. When Ping presented her concept to me and then asked for my opinion, I thought, this could be a completely different relationship than I’ve had in the past. It felt much more like teamwork in our conversations, even though at the time I didn’t have any skin in the game money-wise.

`When was the moment you realized culinary could be a career option? I actually really wanted to be in the arts, but my father told me he wouldn’t pay for art school unless I graduated from a business school. Going to business school made me realize that in order to be in the arts and to live the lifestyle that I wanted to live — which was traveling and eating good food — I needed to have a job that paid, not just an art-based job. It was a pragmatic decision originally. I wasn’t one of those

`You’ve spoken before about how butcheries are actually pretty risky. Why become an equity partner? My dad used to say you’re gambling with M&Ms until you’re gambling with money. I was offered equity about three months before we opened, and I had a little nest egg I had set aside. The second I had my own money invested in Marrow it changed my perspective completely. I’ve also seen a huge return to artisanal interests. People want that connection

`What’s your objective in culinary? Do you have philosophies that you live by? I would love to see people treated as well as we treat our food. We care about where our food comes from and how it’s taken care of, but we don’t care about the people making it. For me, that’s a problem. We try to provide an equitable and a long-term relationship with the people we work with by creating an environment that isn’t yielding burnout. We want to make sure we foster an environment for creativity and not just punching a clock. For me that’s my biggest thing. People assume working 60 hours a week is an industry standard. I don’t approve of that, and I don’t think it’s necessary to be good at your job. I believe in working smarter, not harder, and relying on your team to make your job easy. People have said, ‘I could never do culinary, you have to work so much,’ but not if you do your job well and if you surround yourself with people who have shared values. `What do you find most challenging about your job? Being a chef now is multifaceted. You have to be a business person, you have to be a mentor, you have to be a savant, and you have to be a trendsetter. It’s many hats. It’s challenging. Everybody has different expectations of you, and all of their expectations are incredibly valid. If you’re a front-of-house person wanting a menu break down so that the servers don’t kill somebody with an allergy, it’s just as important as having a dishwasher that day. You have to manage all of those things simultaneously and give them equal value. It’s the only way that you allow people to feel that their position is valuable, because it is. I think a lot of chefs have control issues, which I totally do as well, but I find the failures of my team to be my failures in training them to be adequate team members for me. I recognize that I’m a single person in a big machine of hard-working people that are all equally as creative as me. I’m just the flagship. ` The restaurant industry is predominantly male. Did that affect you in any way? There are a lot of women in my kitchen, moreso than when I was coming up in kitchens. When I started and you ran into another girl in the kitchen, it was shocking. I think it’s significantly more frequent now than when I first started cooking, but I also think that because women tend to create an environment where other women feel comfortable and empowered to succeed instead of challenged in a way that makes you not succeed. I think women tend to grow stronger under female leadership. At least, that’s been the case for me. The way that I give and take leadership as a female is very different than my male counterparts. I also think if you don’t see examples of success that look like you, it’s harder to imagine success that looks like you. ` Do you have any advice for people who are considering becoming a chef? Interview the people that you’re taking jobs with as much as they’re interviewing you. Make sure they’re a good fit for you and that you have shared interests and values. There was a long period of time where I was working in a really toxic kitchen, and I thought that all kitchens were like that. I thought it was a flaw with the system, but it was really just a flaw with the selection process. Just because somebody in some publication somewhere thinks that this is the best restaurant in Detroit right now doesn’t mean it’s the best restaurant for you right now. You have to pick for yourself.

CRAIN’S DETROIT BUSINESS

January 20, 2020

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of exp in IT. Exp req: SLDC for auto infotainment sys, object-oriented program concepts & GPS based car navig sys. Design patterns & program skill in C/C++ Linux, QNX p’forms. perl, python, vba script for test module dev. dev exp in digiVisit crain.com/careers/ for more information tal maps, loc-based service, routing algorithms, route guidance & map visualizaand available positions. tion in RTOS (QNX, embedded Linux). building internal representations environment useful for path plan & control of autonomous vehicles, des & prototyping * for autonomous navig archit, build & deploy Machine Learning Models Tech req analysis & decompos, usage of DOORS req mgmt, estimation tech & work break down structures, Enterprise Arch, MS Visio or other tools for creating des docs. or 313-446-0455 Contact Laura Picariello at Agile & Scrum methodology: Apply: send CV’s to Harman Connected Servforlpicariello@crain.com details. Contact Janik ices C/O G M; (Job Code PE-HCS-M-07); to Suzanne 2002 156th Ave NE Crain Communications is currently seeking an Mahesh Accounts Receivable Suite 200 Bellevue, WA 98007. 732-723-0569 at sjanik@crain.com

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JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 17

How Kermit the Frog ended up at the Detroit Institute of Arts BY CHAD LIVENGOOD

Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

As the Detroit Institute of Arts dusts off America’s favorite amphibious puppet for an exhibition that begins Friday, there’s a little-known backstory about how the profession of puppeteering has roots in Detroit. And that history is tied to how a Kermit the Frog puppet that puppeteer and animator Jim Henson made a half-century ago ended up in the DIA’s collection. Before Henson’s Kermit the Frog and his Muppets gang won the affection of television viewers, there was Paul McPharlin, who is credited as one of the founding fathers of the American puppeteering show business. McPharlin was a puppet maker and performer in the 1920s, ’30s and ’40s who lived in Birmingham and published a letter-press journal from his home about puppets and puppet entertainment, said Lawrence Baranski, director of public programs for the DIA. In the 1930s, McPharlin was the Michigan director of arts projects for the Works Progress Administration, the Roosevelt administration’s New Deal program for putting people back to work during the Great Depression. McPharlin helped build a puppet industry out of the WPA through a national arts project that recorded the history of puppet theater in America. During that time, McPharlin was “very active” at the DIA, Baranski said. “Some were building bridges and some were building puppet stages,” Baranski said. “It was actually a bit of a puppet renaissance, if you will.” In 1936, McPharlin organized a national gathering of puppeteers at the Statler Hotel on Washington Boulevard in downtown Detroit, where they formed an industry group that still exists, the Puppeteers of America. McPharlin died in 1948, the year after he married fellow puppeteer Marjorie Batchelder, who is credited with creating the hand-rod puppets that Henson used with Kermit and “The Muppet Show” in the mid1970s. Batchelder and the McPharlin

“so we were thrilled to keep them here in Detroit,” Molinari said. The Detroit Economic Club was also at the Detroit convention center Monday, and the Detroit Boat Show is moving in ahead of its Jan. 18-26 run. “The boat show is typically in February, but when the auto show vacated (its) dates, the boat show was thrilled to jump in and get an earlier start on (its) big selling season,” Molinari said. And Autorama moved up in February this year, he said. Still, he projects adjustments for the auto show’s new date could have an estimated impact of about $500,000 on TCF’s bottom line. To accommodate the auto show’s move to June, TCF renegotiated with the National Association of Surface Finishers to move its event to July. And it refunded the American Specialty Toy Retail Association’s money and gave it a little extra for its troubles to get out of that contract, Molinari

said. The event has moved to Orlando. He estimates TCF Center lost about $100,000 on that event, and the loss of 53 move-in and installation days in connection with the auto show will add up to the loss of about $400,000 in rent. Due to TCF’s heavy schedule in June, that many moving days won’t be available for auto show setup. Larry Alexander, president and CEO, Detroit Metro Convention & Visitors Bureau, is looking forward to the June show. “I have a lot of optimism for June because the show will be larger with more exhibits and displays and more outdoor activations,” he said in an email. Still, he said, there is “no question that the hole in January is challenging to fill. Our staff has been working diligently to find groups to bring in, but it will take some time.” The American Bus Association, which attracts 3,000-4,000 attendees to its annual gathering, recently an-

Last year, the Detroit Institute of Arts provided free field trips for 80,000 students from Wayne, Oakland and Macomb counties as one of the benefits it provides residents of the counties in exchange for their support of its operating millage. | DETROIT INSTITUTE OF ARTS

DIA

From Page 3

The DIA ran television spots October-December focused on the benefits the museum provides and its upcoming exhibitions on CNN, Fox and other cable networks, Kloostra said. Direct mailings to residents of the three supporting counties are focusing on the same things. They’ll run through early March, Kloostra said. The DIA is still developing a campaign to promote the March ballot proposal. It’s working with Byrum Fisk Advocacy Communications on that effort, which will include direct mail, television, radio, social media and interviews with local media when it rolls out, Salort-Pons said. “We’re moving as quickly as we can because the time is ticking.” Millage revenue accounts for about 65 percent of the DIA’s annual operating budget of $23 million to $25 million, he said. The millage has enabled the DIA to be financially stable, Salort-Pons said. And it pushed the museum to change its internal culture and go beyond the walls of the museum to serve the community, he said. The early renewal is needed to keep the museum operating at its

AUTO SHOW

From Page 1

“Traditionally (the auto show) was our busiest week of the year, across properties,” said Dave Kwiatkowski of the Detroit Optimist Society LLC. The Detroit hospitality group’s bars and restaurants include The Sugar House in Corktown, Wright & Co. and Bad Luck Bar in downtown Detroit and Honest John’s in Midtown. Cocktail bar The Sugar House has been bought out the Thursday night before the Charity Preview for the past five or so years and Kwiatkowski’s not sure if that will continue in June. But he says he isn’t worried. “In January it’s nice to have that revenue pop, but we just came off a really good quarter,” Kwiatkowski said. “Maybe it’ll help in June … which is typically pretty slow for us.” For Bingham Farms-based talent management agency Production

“WE’RE ONE OF THE TOP MUSEUMS IN THE COUNTRY ... BASED ON THE QUALITY AND SIZE OF OUR COLLECTION, AND WE ATTRACT TALENT FROM ALL OVER THE COUNTRY.” — Salvador Salort-Pons, DIA director

current level by extending the 2022 expiration date for 10 years, officials said when the decision to seek the vote was made. About 300,000 people visited the DIA each year before the 2012 millage, Salort Pons said. Today, about 700,000 visit each year, 79 percent of them from Michigan and all but 12 percent of those from one of the three counties supporting the museum’s operating millage.

National profile The DIA is taking the story of its evolution into a highly community-focused museum with a millage supporting its operations to the national media. The museum will highlight its collection and the uniqueness of the Plus, the show’s move to June makes planning for the 2019/2020 auto show season more difficult, said Hedy Popson, president. Production Plus hires, trains and deploys more than 700 contract product specialists to work with 17 car manufacturers at auto shows across the U.S. in a typical year. Last year, it employed more than 500 at NAIAS. Popson said the firm has done its best to place its product specialists elsewhere, but many are not working this week. As an example, one automaker typically required 100 product specialists during the auto show and 35 of those specialists are not working right now, Popson said. Despite the auto show’s move to June, it seemed like a typical press day at TCF Center last Monday, General Manager Claude Molinari said. About 300 journalists showed up to cover the North American Car, Utility and Truck of the Year. The event was wooed by Chicago,

18 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

services and programs it provides to residents through unique agreements with the counties. Those agreements set the DIA apart from the handful of other museums in the country receiving millage support, Salort-Pons said. “We’re one of the top museums in the country ... based on the quality and size of our collection, and we attract talent from all over the country,” he said. Detroit expatriates and others should be able to pick up newspapers in major U.S. cities and read about things the DIA is doing, Salort-Pons said. The DIA has Kermit the Frog and Howdy Doody. But it also has a van Gogh painting it purchased in 1922, the first major art museum in the U.S. to acquire one of the artist’s paintings, he said. To showcase that history, the museum plans its highly anticipated “Van Gogh in America” exhibit, which runs June 21Sept. 27. “We’re bringing to Detroit 68 van Goghs, and we’re going to tell the story of collecting van Goghs in America because we were the first ones,” Salort-Pons said.

Kermit the Frog, 1969, by Jim Henson, is part of the collection at the Detroit Institute of Arts. | DETROIT INSTITUTE OF ARTS

family donated Paul McPharlin’s personal collection of 274 puppets to the museum in 1952, according to the World Encyclopedia of Puppetry Arts. “It’s through all of these connections that Henson appreciated the importance of McPharlin’s work and collection,” said Baranski, who has been curator of the DIA’s Paul McPharlin Puppetry Collection since 1994. In 1971, Henson donated a Kermit the Frog puppet he made in 1969 to the DIA that’s been housed with the McPharlin collection, Baranski said. Baranski said around 1975, Henson came to Detroit and performed a show at a DIA gala with Kermit the Frog alongside puppeteer Burr Tillstrom, creator of the early television puppet show “Kukla, Fran and Ollie.” Kermit and Kukla entertained the crowd gathered at the museum that night, Baranski said. “There were all of these dignitaries in the audience, and the two puppets roasted the audience,” he said. The DIA is putting the 1969 Kermit the Frog puppet on display through late March alongside an original 1947 Howdy Doody puppet that was last displayed at the Woodward Avenue art museum in 2015. Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood nounced it will come to Detroit in January 2023. The residual effect of hosting its annual event is huge, said Renee Monforton, communications director for the CVB. “Their attendees are made up of group tour operators who can bring their tours to Detroit if they’re impressed with the region.” “While we recognize that there will be an adjustment period, the decision to move the show was driven by the desire to reinvigorate the event for 2020 and for the future in a way that we believe is in the best interest of everyone across the region connected to the show,” Rod Alberts, executive director of NAIAS, told Crain’s in an emailed statement. “The same businesses and workers that helped make all our shows great in the past will be the same as those we will be working with over the coming months to ensure the show continues to be a success.”

THE BIGGEST NAMES IN NEWS IN ONE ROOM

NEWSMAKER OF THE YEAR Stephen Ross,

Chairman and founder, The Related Cos.

T0P NEWSMAKERS/2019 Andrew Brisbo

Executive director, Michigan Marijuana Regulatory Agency

Gary Jones

Former president, United Auto Workers

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Fran Parker

Founding executive director, UAW Retiree Medical Benefits Trust

David Provost

Chairman, TCF Bank

Suzanne Shank

President and CEO, Siebert Williams Shank & Co., LLC

Tom Shea

CEO, OneStream Software

Mark Stewart

COO, North American Operations, Fiat Chrysler Automobiles

Gretchen Whitmer

Governor, State of Michigan

M. Roy Wilson

President, Wayne State University

SUPPORTING SPONSOR

BIG BOY

From Page 3

Seller vs. buyer The changes come amid litigation over the sale of Big Boy, though the new stewards of the brand don’t expect it to dampen their expansion plans. Big Boy’s previous owner, radio station entrepreneur Liggett, bought the 455-restaurant chain out of bankruptcy in 2000. Liggett died the July after the sale to Big Boy Restaurant Group LLC, which included Afr, Crawford and others. A lawsuit was filed in early December on behalf of Liggett’s estate over contract issues, according to court documents and Justin Bagdady, an attorney with Ann Arbor-based Bodman PLC who is representing the seller. Bagdady and his client declined to comment further. The entities that sold Warren-based Big Boy Restaurants International LLC are registered with the state to Keith Sirois, who was the CEO before Crawford. The complaint details disputes over $250,000 in escrow funds from the purchase price, which payment obligations belong to whom and who must pay tens of thousands in assorted fees. Big Boy Restaurant Group, the buyer, filed a counterclaim Jan. 10. Both sides claim the other is responsible for liabilities, alleging they’ve suffered damages and want money back. The seller alleges more than $30,000 in damages in its lawsuit; the buyer would not disclose a figure. The purchase agreement wasn’t attached to public documents and Big Boy’s general counsel, Altinia Kandrevas, declined to share it with Crain’s. “It is not uncommon for there to be disputes between buyer and seller with respect to escrow after the closing, but they also usually get worked out without the need for litigation,” said I. W. Winsten, leader of Detroit-based Honigman LLP’s complex commercial litigation practice group, who looked over the lawsuits for Crain’s. “And when they don’t get worked out and litigation results, it typically means there’s something else going on.” Kandrevas said she doesn’t see the lawsuit as “contentious” and hopes “we come to a resolution as quick as possible to avoid legal expenses and time.” “It’s a contract issue that should be solved pretty quickly and amicably. They have their opinion as to what happened, we have my opinion ... We’re just following the agreement,” she said. “I get it, everyone sees lawsuits and they think lawsuits are scary, but Big Boy has done a lot of things in the course of 14 months that have really righted the ship. The team is reinvigorated, we are back on track and trying to innovate ...”

2020 vision

A new Big Boy restaurant announced in August for the former Pasquale’s Restaurant site at 31555 Woodward Ave. is still moving forward, according to Big Boy leadership. The 65-year-old Pasquale’s closed in April. Big Boy plans to demolish Pasquale’s and build a two- or three-tenant building. A 4,500-square-foot Big Boy would open there in the third quarter.

Crawford previously teased Buddy’s Pizza as a possible tenant, but all Kandrevas said last week was that “nothing has been signed yet.” Big Boy’s site plans still require Royal Oak city approval and had not yet been submitted, according to the city. The DelGiudice family that owned Pasquale’s and is leasing the property to Big Boy confirmed through a spokesman that the lease is still effective and said they remain “confident” in the tenant. Another two- to three-tenant development is in the works in Fraser on the property of Afrowned Fraser Hockeyland. A third-quarter opening is anticipated for the hockey-themed Big Boy there. The 4,200-square-foot Muskegon, 3,900-square-foot Okemos and 4,700-square-foot Grosse Pointe Woods locations are set for second-quarter openings. Big Boy also has a deal with Southeast Asian franchiser Destination Eats.

Lawsuit resolved Public relations firm Tanner Friedman Strategic Communications sued Big Boy’s ownership in mid-December, seeking $7,900 in payments it said it had not received for three months of services in the fall. They settled Jan. 14, according to Tanner Friedman co-founder Matt Friedman and Kandrevas, and agreed on full payment. Friedman said his company started working with Big Boy in April and communication fizzled after former CEO Crawford left. Friedman said he sought repayment from vice president of marketing Julie Zurawka, who is also no longer with the company. Crawford told Crain’s via text message that he “left last year to go to work with another brand.” He did not respond to a request for an interview. Afr declined to comment on the exact circumstances of Crawford’s exit, aside from saying that change comes naturally with ownership transitions. “With any transition, there’s going to be some things that, unfortunately, get missed and need to get cleaned up,” Afr said. An example of that came last fall. Tanner Friedman’s services included coordinating a promotion between Big Boy and a Southfield Public Schools program with nonprofit Blessings in a Backpack. The restaurant’s newly opened fast-casual location at 26400 Telegraph Road in Southfield would donate proceeds from milkshake sales in September and October, according to the charity, a flier and promotional materials on Facebook. As of Jan. 8, Blessings in a Backpack hadn’t received any money, according to Cheryl Whitton, Michigan adviser for the national children’s food-access nonprofit. When Crain’s inquired with Big Boy about the payment, Afr and Kandrevas said they were unaware of the promotion. However, Jon Maurer, Big Boy’s vice president of marketing, told Crain’s on Jan. 13 that he spoke with Whitton and pledged a $500 check — well more than the $141.10 in sales from milkshakes sold for those two months. Whitton confirmed that Big Boy would present nonprofit the check this week. Contact: afrank@crain.com; (313) 446-0416; @annalise_frank

20 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

LABS

From Page 1

“We are flooded with calls from people who want testing, but we can only do so much,” Rosman said. “There’s new dispensary clients all over the state of Michigan. We have to shoehorn them in for appointments, and we’re scheduling them weeks down the road.” Call it luck that new rules governing the fast-evolving pot industry are feeding business to PSI, or call it stellar foresight. Either way, it’s new territory for a company that operated in a legal gray area when it started. In 2016, the state approved a legal framework for medical marijuana that required safety testing. Safety compliance testing was also mandated as part of legislation voters approved in November 2018 to legalize recreational marijuana. Sales in Michigan started Dec. 1, 2019. PSI wasn’t alone in the testing game. Walled Lake-based Iron Laboratories LLC formed in 2011, and like PSI, began conducting non-mandatory tests, mostly for independent clients and dispensaries looking to figure out potency for marketing purposes. The companies operated discreetly in those days, unsure of how the laws would shake out. Now, they are the frontrunners in a $128 million national marijuana testing services market expected to grow 16 percent in the next eight years, according to Washington-based researcher Coherent Market Insights.

How it works At PSI, a staff of 30 scientists and technicians wears white lab coats and hustles to process samples. Rosman, a former marijuana defense attorney, and Spivak-Birndorf, a geochemist, rock a more casual look, each wearing open-collar dress shirts tucked into jeans. A distinctly dank smell fills the 6,500-square-foot lab. As required by law, the lab conducts more than a dozen quality assurance tests before a product is approved for market. In addition to THC potency and mold, tests are run for metals, terpenes, chemical residue, microbials and mycotoxins. “When we started this testing, it wasn’t required in any way,” Spivak-Birndorf, said. “Labs would do microscopic testing for obvious signs of mold, but they weren’t testing for pesticides and heavy metals and oth-

er hazards. It was just largely being ignored. (Mandatory tests are) good because it’s helped people refine their process and clean things up.” The stringency of tests — and the cost — depends on the product, e.g., plants, edibles, concentrates and distillates, Rosman said. PSI’s cheapest service is $40 for an R&D test, which gives clients an indication of product purity but does not count for state certification. Tests that approve a product for store shelves range from $350 to $800 per batch. Typically, the priciest tests are for flower, which is more prone to contaminants, while testing an edible whose THC content has already been OK’d would fall on the low end of the spectrum. Safety labs are required to test 1 ounce of product per 15 pounds, which is the state limit for one batch. Lab workers obtain the samples from their client’s production site and take them back to the lab. After conducting the tests, results are recorded with the state’s Marijuana Enforcement Tracking Reporting & Compliance database. “The methodology for pricing is based on the cost and labor of test-

FRIENDS

From Page 3

“We can’t make it a success from Portland. It’s why we’re putting a local board of directors together and hiring all the staff locally,” Sorenson said. “We know the people of Detroit know their community best and really are the ones to make this work,” she said. “We’re just coming alongside to share what we know through the last 26 years.”

High need in Detroit Friends is different from other mentoring programs in that it focuses on serving children with the most severe challenges, Sorenson said. In Michigan, one in five children has experienced two or more adverse childhood experiences, the nonprofit said, citing information from the 2019 Kids Count Michigan Data Book

Sorenson

Alcock

published annually by the Michigan League for Public Policy. Those experiences or “ACEs” are potentially traumatic childhood events that can have negative, lasting effects on health and well being. They can include things like a child experiencing or witnessing violence, abuse and death in the family, along with other issues that create an unstable home environment, such as substance abuse, mental health issues, divorce and incarceration of a parent, according to the Centers for Disease Control. In Detroit, the number of confirmed victims of child abuse and ne-

ing. We’re not charging some exorbitant fee because we have a monopoly or anything like that,” Rosman said. “(Profit margins) are good. I have a feeling next year, they’ll be a little thinner as we expand, but yeah, right now, this was a good year. This was a huge growth year.” PSI expects to hit $10 million in revenue this year, far surpassing expectations from a few years ago when the co-owners started with a $200,000 investment and no hired help.

Vials facil

Barriers to breaking in Marijuana safety compliance is becoming a lucrative gig for those who can get it. Labs operating in the state must be fully accredited by the International Organization for Standardization. ISO certification is the gold standard for management systems — it is also costly, time-consuming and challenging to obtain. Another barrier is municipalities blocking recreational weed within their borders. Around 80 percent of Michigan communities have opted out of adult use marijuana, meaning retail pot shops and recreational

Lev S cann

glect has risen by 84 percent since 2010, and the number of youth experiencing foster care in Detroit increased by nearly 55 percent, Friends of the Children said, citing Michigan Kids Count data. “In Chicago, we were brought in as a gang violence prevention. In LA they have more foster youth aging out than anywhere in the country. We were asked to take the youth aging out of foster care and select their children age 4-6 to be in the program,” Sorenson said. In Detroit, Friends, which is now in 20 cities across the U.S., will work with nonprofits and others to identify children age 4-6 who are living in poverty who have experienced or are at risk of adverse experiences. For example, it will engage with DLive, a violence-prevention effort based at DMC-Sinai Grace Hospital with the Wayne State University Department of Emergency Medicine, to identify young children from families with gang ties to help break the cycle through mentoring, Sorenson said.

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safety compliance labs alike cannot operate there. Labs can also expect ramped up enforcement from the state as the industry matures. Iron Labs became the example in mid-August when the state suspended its license and fined it $100,000 for reporting inaccurate test results. The lab reopened a few weeks later. “The issues were discovered during routine monitoring,” Andrew Brisbo, executive director of the state’s Marijuana Regulatory Agency, said, adding that the agency has two scientists on staff who analyze test results. “That situation was a validation of the need for us to have continuous oversight.” Iron Labs was the first and only safety compliance facility to be fined by the state, Brisbo said. Many in the industry saw it as a warning to other labs to tighten up operations. “Somebody had to be first,” said Michael Goldman, chief operating officer at Iron Labs. “We don’t think it was fair. I think by them suspending our business, it sent ripple effects throughout the industry that still have not been remedied. … We’re happy we could come to terms with the state.”

Handling the bottleneck Vials of product are being tested for heavy metals and contaminants at PSI Labs in Ann Arbor, the only licensed marijuana testing facility for recreational cannabis. | KURT NAGL/CRAIN’S DETROIT BUSINESS

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Lev Spivak-Birndorf (left) and Ben Rosman co-founded PSI Labs in 2015. They were childhood friends long before they got into the cannabis testing business.

“We are looking for the kids facing the greatest obstacles, who through the long-term intentional caring of an adult can reach their full potential” and beat the odds, she said. “Through no fault of their own, they’re in pretty difficult circumstances.” The Friends model first gained local attention in 2016-17 when the Detroit Free Press reported on it and convened a local discussion around it, Sorenson said. Local champions worked with Friends of the Children to raise $1.5 million from local and national funders, including: Michigan Health Endowment Fund, McGregor Fund, Jamie and Denise Jacob Family Foundation, AT&T, Stand Together Foundation, the New York-based JDJ Charitable Foundations and dozens of individual donors, including basketball legend Michael Jordan. Children in the Friends program will be paired with a local, degreed professional who has at least a couple of years of experience working

“WE ARE LOOKING FOR THE KIDS FACING THE GREATEST OBSTACLES, WHO THROUGH THE LONGTERM INTENTIONAL CARING OF AN ADULT CAN REACH THEIR FULL POTENTIAL.” — Terri Sorenson, CEO, Friends of the Children

with vulnerable children and families. Friends will train mentors to prepare them for the full-time jobs, which will include spending four hours a week with each child at school, home and in the community, in order to build trusting relationships and provide social-emotional and academic support. Working with parents and teachers, mentors also create plans for each child with goals and document their progress to collect data that will be shared with the

national affiliate. “We ask people to make a threeyear commitment and let them know if they stay any less, they’re doing more harm than good,” Sorenson said. Most Friends mentors stay with the nonprofit for five to seven years. Children will have one mentor for grades K-5 and a second mentor for grades 6-12. “We learned around middle school, kids pull away from mentors much like parents,” Sorenson said. In Detroit and other new cities it’s heading to, like Salt Lake City, Friends will support not only the kids but also their caregivers, she said, with parenting supports. The Friends model, which has been featured by the Chicago Tribune, New York Times, Detroit Free Press, CBS News and Stanford Social Innovation Review, has a strong record of proven results, according to the data it’s collected. Over its 26-year history: `83 percent of children in the program graduate from high school, when 50

While the state mandates testing of all types of pot, there had been a way — until recently — to circumvent it. Provisioning centers had been allowed to source untested products directly from caregivers and sell them with a waiver. The state ended that practice in April, forcing all product to be tested and effectively bringing safety labs into a critical role of the supply chain. The state maintains that the bottleneck at safety compliance labs will work itself out as the market matures, just like price-gouging and long lines at retail shops will eventually subside. To move that process along, officials are drafting new rules to make it easier for labs to open, Brisbo said. By spring, the agency aims to allow any accredited labs to enter pot testing — for the time being, pot testing cannot be co-located with other types of lab testing or business. “It can become a choke point for the supply chain because everybody has to go through testing,” Brisbo said. “When you’re dealing with a very small market, it can be volatile. Similar to what happened on the medical side, we’ll see labs scale up as the industry scales up.” percent of their parents did not. ` 93 percent avoid the justice system, when 60 percent of their parents have been incarcerated. ` 98 percent avoid teen parenting, when 86 percent were born themselves to a teen parent. ` 92 percent of the youth are enrolling in post-secondary, enlisting in military or are employed in a living-wage job. “Research has shown that a caring adult helps mitigate trauma and overcome these obstacles,” Sorenson said. As for the return on investment, for every $1 invested in Friends of the Children, it returns $7 to the community, saving the community $900,000 in social costs for one child, the organization said. Friends’ focus on highneed and high-risk children spurred the Detroit-based McGregor Fund to make a three-year, $300,000 grant to help bring the nonprofit and its model to Detroit, said Heidi Alcock, director of grant development and communications at McGregor.

The market will take care of price setting, too, according to Brisbo. “Ultimately, the people in the industry understand that they are playing the long game,” he said. “If they do things that are disadvantageous to their customers, then that’s gonna hurt their business partnerships in the long-term.”

Growth visions For PSI, which operates in a town that’s become a marijuana mecca in Southeast Michigan, location has spurred business. For others, it’s been a hindrance. Several medical marijuana testing labs have been unable to make the leap to recreational testing amid indecision by city officials. Iron Labs is poised to add the service in the coming months, said Rob Teitel, president of the company. “We’re working on the process to achieve the adult use (license),” he said. “What you’re gonna see is most growers gravitating toward the recreational side because that’s where the customers are.” Teitel said the company, which also has a testing lab in Oregon, is doing well over $1 million in yearly revenue in Michigan and could potentially double headcount in the next year to more than 30 employees at its trajectory. PSI will also double headcount or more, Rosman said. It is looking to move soon to another property in Ann Arbor between 15,000 square feet and 30,000 square feet. “When we got this place two years ago, it seemed way too big for us and it was kind of scary,” he said. “Now we’re at this point that we’re bursting at the seams.” Additionally, the company is in advanced discussions with an out-ofstate equity investor. Rosman and Spivak-Birndorf, who are equal partners, said their only investors to this point are family and friends. They declined to say more about the forthcoming deal. They said they are angling to sell the company, but not for a few years. “There’ll be 50 states with legalized marijuana inevitably, and really there’s a lot of opportunity in that not happening yet. With federal involvement as it is, I think it keeps some of the bigger players that might be able to try and take up large market share out of the industry in general,” Spivak-Birndorf said. “We’re trying to go as big as we can go.” Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl “They’re not trying to pick the kids that are easiest to serve,” she said. They’re selecting kids … who have the most severe challenges.” There’s strong evidence that a consistent, long-term presence and relationship with an adult can be very transformative for children who’ve experienced trauma, she said. “I think this is a really interesting addition to supports for kids in Detroit. I think we can learn a lot from them.” Existing mentoring agencies working in Detroit can’t meet the demand for mentors, said Jeannine Gant, CEO of Big Brothers Big Sisters of Metropolitan Detroit, which provides mentoring to children in Wayne, Oakland and Macomb counties. “If Friends can produce the outcomes using evidence-based, best practices, that helps to strengthen the mentoring field in this community,” she said. Sherri Welch: 313 (446-1694) Twitter: @SherriWelch

JANUARY 20, 2020 | CRAIN’S DETROIT BUSINESS | 21

THE CONVERSATION

Nature and business, no longer in conflict?

crainsdetroit.com

THE NATURE CONSERVANCY: Helen Taylor, state director of the Michigan Chapter of The Nature Conservancy, has been the nonprofit’s top leader in the state since 1999. Appointed by former Gov. Rick Snyder, Taylor also serves on the Great Lakes Commission, 21st Century Infrastructure Commission and the Environmental Rules Review Committee. Taylor, 59, got a new pair of Carhartt overalls for Christmas and spent the recent holiday break bushwacking a trail on her up north property. The Northern Michigan University graduate has dedicated the last 30 years of her career to the Great Lakes and conservation. | BY DUSTIN WALSH ` CRAIN’S DETROIT BUSINESS: Conservation and the environment has never been more controversial. Despite political loggerheads, are Michigan’s many businesses more engaged in conservation than before? The intersection of business and natural resources goes as far back as this state’s existence. But the protection of nature is becoming a more central concept to business and being understood as a driver of economic activity. When I got involved in this effort some years ago, businesses cared about the environment as a public relations platform. Now it’s part of actual business decisions, critical to central planning for a business. If you step back, you see very big trends in sustainability. Companies are finally connecting sustainability to their bottom lines, to the services nature provides, such as cost reductions from managing stormwater. These efforts can go toward lower insurance rates. Farmers are seeing how using nature can lower costs, increase yields and lead to better soil. Especially in Michigan, nature is critical to attracting talent. The Great Lakes are our ultimate draw. Employees want to work for companies that care about these issues. Consumers care about this too. The environment, public health and sustainable economic growth are totally interdependent. This is why nature conservation is so important to the business community ... because they now understand. We have become much more sophisticated at evaluating nature and understanding its impact on the bottom line. Nature provides so many opportunities to accelerate the response to the challenges we’re seeing. `What sort of opportunities? We can integrate natural climate solutions. For Detroit, they have a new

stormwater policy that incentivizes green infrastructure to manage stormwater effectively. Look at Sacred Heart Church in Eastern Market. They are going to manage 1 million gallons of water by just reconfiguring their parking lot. That’s going to reduce their drainage charge by 50 percent. They’ve managed to do the sustainable thing while also saving money. Companies can, and should, look at their internal practices to see where they can save money, but also create more sustainability. Manufacturing companies are going to have to find ways to offset their carbon if they want to reach carbon neutral, as some have said publicly. Michigan has all this forest and can use more. Forest restoration for carbon offset is a real opportunity. We’re not saying trees won’t be cut, but productive forestry management is an effective way to reach those goals. `Do you think tragedies like the recent fires in Australia eliminate skepticism among businesses about their impact on nature and climate? I’m hesitant to speak for business, but there was a report released by the Pentagon last year that identified how flooding, drought, wildfires, melting permafrost are all threats to national security. Most businesses tend to accept, rather than deny, the conclusions of science. Science is telling us that if you want to thrive in the marketplace, you have to listen to what’s happening. That’s why we’re seeing so many companies doing these things around conservation on their own instead of having to write a government mandate. They are looking at long-term planning and they are making commitments. That’s telling us something. There are things all companies should be doing, of course. `What should every company be doing?

Even at a small scale, just understanding the value of managing stormwater. What you can bring to a neighborhood by managing your drainage discharge is a big step. Quite honestly, every company should be putting one of their very best people in charge of this issue. If you don’t have a chief sustainability officer, hire one. Managing the supply chain is also critical. There are supply chain consortiums that help manage these issues. Find them. A valuable point is to commit to transparency. If you have to depoliticize these issues between business and nature, you shouldn’t. It is a space of conflict or contraction. The more you sit down and talk it through, this is an easy decision. You can’t do everything on a dime, but if you can understand this might help your bottom line, the investments get easier.

don’t want to be part of the problem, but part of the solution. So we have to sit down and create solutions together. That’s the space where we like to engage with businesses. It’s not about blame or an unfair disadvantage, but how are we going to solve these things. This is definitely affecting future generations, so we have to understand the science before (all of the nature) is gone. We can do this as a win-win.

Helen Taylor, state director of the Michigan Chapter of The Nature Conservancy, Lansing

`So much conversation is around large sweeping federal policy to combat climate change and nature destruction. What would you consider smart public policy? What Detroit did with its ordinance for new development. They didn’t have an ordinance for stormwater management, so they added it with certain incentives. We could also do better to incentivize more green infrastructure. We can use available resources to begin the projects because I think you can go pretty darn far with demonstrating the advantages of this without regulations and mandates. All regulation is not bad, but you have to engage and have clarity. Clarity for long-term planning is essential. Most companies

REPORTERS

Annalise Frank, city of Detroit. (313) 446-0416 or afrank@crain.com Jay Greene, senior reporter, health care and energy. (313) 446-0325 or jgreene@crain.com Nick Manes, finance and technology. (313) 446-1626 or nmanes@crain.com Kurt Nagl, higher education, business of sports. (313) 446-0337 or knagl@crain.com Kirk Pinho, real estate. (313) 446-0412 or kpinho@crain.com Dustin Walsh, senior reporter, economy and workforce, manufacturing, cannabis. (313) 446-6042 or dwalsh@crain.com Sherri Welch, senior reporter, nonprofits and philanthropy. (313) 446-1694 or swelch@crain.com MEMBERSHIPS

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Crain’s group publisher among Community House honorees BIRMINGHAM’S COMMUNITY HOUSE will honor Crain’s Group Publisher Mary Kramer, Oakland University President Ora Hirsch Pescovitz, M.D.; and TCF Bank Chairman David Provost and his wife, Christine, at its annual Bates Street Society Dinner. They are among several leaders receiving the group’s annual Pillars of Vibrancy honors for their work and contributions in education, culture, wellness, business and philanthropy. Other honorees include Brian Berman, M.D.; Margaret Cooney Casey, chief development officer at Beaumont Health, Hannan Lis, principal of The WW Group Inc.; Keith Pomeroy, founder and chairman, Pomeroy Investments; and photojournalist and author Linda Solomon.

Editor-in-Chief Keith E. Crain Publisher KC Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Associate Publisher Lisa Rudy, (313) 446-6032 or lrudy@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Group Director: Business Process Kim Waatti, (313) 446-6764 or kwaatti@crain.com Digital Portfolio Manager Tim Simpson, (313) 446-6788 or tsimpson@crain.com Creative Director David Kordalski, (216) 771-5169 or dkordalski@crain.com Assistant Managing Editor Dawn Riffenburg, (313) 446-5800 or driffenburg@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

The Community House is a nonprofit resource and destination in Birmingham for professional, recreational and p h i l a n t h ro p i c pursuits. Kramer The dinner is scheduled for 6:30 p.m. Feb. 8. Tickets are available at communityhouse.com.

` TCF SEEKS ARTISTS FOR MAJOR NEW SCULPTURE THERE COULD BE A BIG NEW SCULPTURE out front of TCF Center sometime soon. Last week, the Detroit Regional

22 | CRAIN’S DETROIT BUSINESS | JANUARY 20, 2020

TCF Center in Detroit. | LARRY PEPLIN FOR CRAIN’S

Convention Facility Authority Art Foundation, or Art at TCF Center, put out a call for artists’ proposals for a new “large-scale, public sculpture” in the center of the TCF Center’s main entrance circle drive on Washington Boulevard in down-

town Detroit. The competition is part of a public art initiative launched by the DRCFA and the DRCFA Art Foundation. The organization suggested it is looking for “positive themes” that “reflect the positive changes and growth ongoing in Detroit and Southeast Michigan, the strong spirit of innovation and design, the global impact of Detroit and renaissance of the region.” Dimensions? No bigger than 30 feet high or 8 feet in diameter. Interested artists must attend an informational meeting March 1 at TCF Center and RSVP no later than Feb. 28. RSVPs should be sent to mdevine@drcfa.org. The final entry deadline via CaFÉ is 5 p.m. June 2. Register at artist.callforentry.org/ register_info.php.

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