Crain's Detroit Business, Dec. 14, 2020, issue

THE CONVERSATION

Women in Leadership: Kathy George on running a casino during COVID. PAGE 16

Environmentalists and industrialists can coexist, says Detroit Mercy School of Law’s Nick Schroeck.

PAGE 26 CRAINSDETROIT.COM I DECEMBER 14, 2020

WORKFORCE

Businesses may struggle to reach herd immunity

HEALTH CARE

Employees may resist COVID vaccine Every year, Livonia-based metal stamper and fastener manufacturer Alpha USA offers the flu vaccine to its employees and their families. The vaccines are offered free on site at the workplace to encourage inoculation.

Yet only about 40 percent of its 130-employee workforce took the needle. To reach herd immunity for the COVID-19 vaccine, epidemiologists and medical researchers from the Imperial College in London estimate vaccinations must reach 60 percent to 72 percent of the population, according to research published in the medical journal The Lancet last month.

Executives at Alpha USA and most Southeast Michigan companies are puzzling over how they

“WE WANT TO END THIS PERIOD OF ISOLATION.” — David Lawrence, chief administrative officer at Alpha USA

can boost the vaccine take rate and return to a safe working environment free from the dangers of this deadly virus.

“We know 40 percent is not enough, so we’re going to take a different approach,” said David Lawrence, chief administrative officer at Alpha USA. “We want to end this period of isolation.”

Alpha USA is hoping to sign all of its employees up for the vaccine and force them to opt out of taking it instead of opting in, like they do with the flu vaccine. It’s also upping education about how the virus impacts the workplace.

See VACCINE on Page 25

CAREGIVING AT A CROSSROADS As the need for home care rises, there’s a shortage of workers Dodie Torzewski, manager of a Samaritas group home in Monroe, said her six-person staff have been working mandatory overtime for the past two months amid a shortage in caregivers for four disabled women.

The need for home-care workers is rising as Michigan’s population rapidly ages.

But the wages and stature for these less-visible front-line health care providers remains low and stagnant. That’s contributing to a labor shortage that has only worsened during the COVID-19 pandemic as caregivers fear contracting the virus and see opportunities to earn more money in other low-skilled jobs.

As one prospective employee told a group home manager, “$13 an hour? I can’t live on that.”

This month’s Crain’s Forum dives into the fragile state of the direct care industry, the disjointed payment system and some of the issues policymakers could consider to address a growing need. The report begins on page 17.

ALSO IN FORUM Livengood: Michigan’s home care labor model is broken. PAGE 22 Why a wage boost for caregivers matters. PAGE 18 Demand for direct care workers will grow. PAGE 18

Q&A | KOFI BONNER

New Bedrock CEO Bonner: From SF to the 313

BY KIRK PINHO

Kofi Bonner has joined Dan Gilbert’s Bedrock LLC as its new CEO as the Detroit-based real estate company charts a new course in a new asset class, continues its push to complete a skyscraper project and restocks its C-suite after a series of high-level departures.

VOL. 36, NO. 50 l COPYRIGHT 2020 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

NEWSPAPER

NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY DUSTIN WALSH

Bonner, who spoke with Crain’s Detroit earlier this month from California, started his new position in September.

Prior to joining Bedrock, he was the co-COO at Irvine, Calif.-based Five Point Holdings LLC (NYSE: FPH) where he worked on major projects in San Francisco and elsewhere.

Bonner, 64, is also the former chief administrative officer and executive vice president for the Cleveland Browns, the first Black person to hold such a title within the NFL. He is the owner of Bonner Enterprises, a real estate development and technology company. His development efforts through that company include projects in San Francisco and Ghana.

What follows is a partial transcript of the interview, edited for length.

OUTLOOK 2021

Find out what Kofi Bonner and eight other business leaders expect in the year ahead.

PAGES 10-14

Where else should we anticipate Bedrock looking to broaden its efforts in that industrial/warehouse arena, beyond the Sakthi site?

I’ve had the pleasure of being toured by my team members here, and I was absolutely amazed at, frankly, the size. Of course, I know the numbers but when you’ve driven it, it certainly feels very different. Remember I’m coming from a city (San Francisco) that’s only 49 square miles and 850,000 people.

So going to a city of 700,000 people and 139 square miles, there’s quite a difference.

Scale is one thing. But when I’m driving around, understanding the history, the industrial roots and DNA of Detroit and finding these, what I consider to be wonderful industrial properties that are, frankly, well situated in some respects for what I consider the newer industries, I find it very intriguing.

See BONNER on Page 24

NEED TO KNOW

GOVERNMENT

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT ` MICHIGAN JOBLESS NOT SPIKING WITH REST OF NATION THE NEWS: New jobless claims in Michigan remain historically high, but did not spike alongside the national total last week as the COVID-19 pandemic rages on. In Michigan, 22,170 initial unemployment claims were filed for the week ending Dec. 5, down 3.6 percent from the total a week earlier.

WHY IT MATTERS: The U.S. overall saw a nearly 20 percent spike in new claims last week to 853,000. Michigan was one of only three states that saw claims decline last week, despite a three-week “pause” on indoor dining, sporting events and casino gaming.

` BUSINESSES CLOSED BY STATE ORDER GET TAX EXTENSION THE NEWS: Movie theaters, bowling alleys, bars and restaurants shuttered by state public health orders are getting an extra month to pay their withholding, sales and use taxes to the Michigan Department of Treasury.

Gov. Gretchen Whitmer’s administration is waiving penalties and fines through Jan. 20 on their tax payments due Dec. 20 for businesses shut down by the Michigan Department of Health and Human Services.

WHY IT MATTERS: Businesses barred from being open for indoor service

have an extra 31 days to make quarterly tax payments to the Treasury Department. Whitmer has also said her proposed $100 million state-level COVID relief fund would be split evenly between individuals and businesses shuttered by her administration’s closure orders, if approved by the Legislature.

` EMAGINE BETS ON FUTURE OF MOVIES WITH MORE THEATERS THE NEWS: Troy-based Emagine Entertainment Inc. signed long-term leases for four additional theaters across the Midwest: one in Saginaw, two in Indiana and one in Illinois, co-founder and Chairman Paul Glantz said. The locations were among those operated previously by Grand Rapids-based Goodrich Quality Theaters Inc., which filed for bankruptcy protection at the end of February.

WHY IT MATTERS: The sites would add to 11 Emagine theaters in Michigan, Illinois and Wisconsin. The deal comes during a catastrophically bad year for the theater business, with

pandemic restrictions on gatherings combining with delays of most new movie releases to crimp business.

` DETROIT TO HALT WATER SHUTOFFS THROUGH 2022 THE NEWS: The city of Detroit’s water department says it’s extending a moratorium on home service shutoffs through 2022 and aims to eventually end shutoffs altogether. It plans to use state, federal and private funding to keep residents’ water on after its COVID-19 Water Restart Plan that began in March finishes up at the end of the year.

` COVID-19 CASES SURGE IN NURSING HOMES THE NEWS: Since Oct. 21, total positive COVID-19 long-term care facility nursing home cases have increased 62 percent and total resident deaths have risen 33 percent. Reflecting community spread of coronavirus, staff cases have increased 99 percent.

We are proud of our history and culture; we are confident of our future.

Detroit, MI | Chicago, IL | Las Vegas, NV Los Angeles, CA | Peoria, IL

2 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

` Michigan lawmakers last week planned to borrow $600 million to fund the state’s proposed settlement with the residents of Flint, who sued after their municipal water supply was contaminated with elevated levels of lead for 18 months. Under the bipartisan legislation, the loan from a state economic development fund would cost more than $1 billion to repay over 30 years. It is believed to be the state government’s largest-ever legal settlement.

WHY IT MATTERS: Mayor Mike Duggan, who also announced last week he will run for re-election, said the city aims to also “permanently end” water shutoffs at some point in the future. The commitment appears to be a reversal for Duggan, who said in March that a full-on “moratorium on shutoffs” doesn’t work in other cities and won’t work in Detroit.

We are Howard & Howard—

www.howardandhoward.com | 248.645.1483

Michigan will borrow $600M for Flint water settlement

The state and other defendants have reached a settlement valued at $600 million to deal with fallout from the Flint water crisis. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

WHY IT MATTERS: The state’s 15 specialized care recovery centers are beginning to fill up with transfers from hospitals and other long-term care facilities, and the capacity challenges

are significant. The AARP Nursing Home COVID-19 Dashboard reported that 42 percent of nursing homes have staffing shortages as of last month, up from 26 percent in October.

REDEVELOPMENT

WHEN ONE DOOR CLOSES, ANOTHER OPENS Delta Iron Works departing longtime home to clear way for Solanus Casey Center expansion

Delta Iron Works owner Chris Manos poses for a portrait outside of the tool vault at Delta Iron Works in Detroit. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY SHERRI WELCH

As he packs up to move Delta Iron Works Inc. from its longtime home on Detroit’s east side to make way for the Solanus Casey Center expansion, Chris Manos is making a mental list of a few things he’ll take to remember the place.

There’s the walk-in safe that came from the venerable Berry Brothers Paint and Varnish Co, a company that operated nearby after opening in 1860. He’ll also take the heavy, scratched-up front door with “Delta Iron” painted on it that he helped his father make when he was in high school when the company added a second addition to the building.

Delta Iron Works was started by Chris Manos’ father, Stephen George Manos, in 1957 and has been at 1801 Meldrum St. since 1961. Chris Manos will be bringing a few sentimental metal doors to his new location.| NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

It’s a window to everything the family and company have come through and to the future as Manos prepares to begin construction on Delta’s new building.

“When I am away from the shop for a while, either on vacation, a long weekend or whatever, I always feel like I’m back once I walk through that door,” Manos said.

Manos sold the building his company has called home for nearly 60 years to his neighbor, the Solanus Casey Center, for an undisclosed amount as part of a deal worked out with the center and the A.A. Van Elslander Foundation.

And then there’s the old wooden door to the company’s small upstairs office, which will be reinstalled at the entry to the office in a new building he plans to build a block away.

“I’ve been going in and out (of it) since I was coming down here as a kid,” Manos said.

The painted door with nicks here and there reminds him of his father, who started the company in the 1957 and moved a few years later to the Meldrum site, and all of the time the two spent at the factory and in the office, Manos said.

The ticket-window door came from buddies who were demolition contractors and got the door from a building they were tearing down.

See DELTA on Page 24

FINANCE

Pandemic slows bank M&A, but experts see activity on horizon

BY NICK MANES

2020 may have seen a relative pause in the yearslong trend of bank consolidation, but don’t expect that break to last long.

Mergers and acquisitions in the financial sector had been moving along at a steady clip for several years, but the economic tumult stemming from the COVID-19 pandemic, particularly in the early part of the year, brought much of that activity to a halt.

Opinions differ on the amount of activity and how quickly it may begin to percolate once the economy begins to recover as a vaccine becomes

Bell

Shafer

available, but most experts agree that significant dealmaking lies ahead.

“As soon as this ends, I’ll tell you, I expect there to be a very large increase and uptick in (M&A) activity,” said Michael Bell, co-leader of the financial institutions practice group at

the Honigman LLP law firm. “I think there’s a lot of pent-up demand that has been paused or not even started because of the pandemic, and it will break loose.”

Bell added that even though the pandemic continues raging, bankers are starting to move forward with dealmaking.

“I’m seeing activity (and) we’re getting busy. Sellers are coming to the marketplace,” he said. “I can’t imagine how busy it will be once this finally gets solved.”

Tom Shafer, the CEO of Detroit-based TCF National Bank, said his bank — the largest headquartered in Michigan and built through a

streak of deal-making that goes back more than a decade — is not necessarily scouting for other institutions to buy, but is ready for the right opportunity. TCF in August completed its integration with Chemical, with the $3.6 billion merger being completed last year.

“You build a plan for organic growth, but be acquisition-ready,” Shafer, who’s been involved in over two dozen transactions in his career, said of his M&A strategy.

“What that means is you never know when the moment is going to happen. These are fleeting opportunities,” Shafer said last month during a virtual event hosted by Walsh Col-

lege and moderated by a Crain’s reporter. “When they appear you better be ready to take advantage of it.

That’s partially a mindset, that’s partially a technical skillset, and you’ve got to prepare your team for change.”

A mid-November report from S&P Global puts in stark terms just how significant the impact of COVID-19 was on M&A activity in the banking sector.

The first 10 months of 2019 saw 219 deal announcements totaling $49 billion. The same time period in 2020 equated to 92 deal announcements totaling under $10 billion.

See BANKS on Page 23

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 3

REAL ESTATE INSIDER

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A rendering of two buildings totaling more than 600,000 square feet planned for the former Pinnacle Race Course site in Huron Township. | GHAFARI ASSOCIATES

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4 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

Amazon revealed as tenant in former race course site A ma z o n . c o m Inc. is occupying another 1.27 million square feet of space in the region, Crain’s has learned.

With the latest addition of more Kirk than a million PINHO square feet the Seattle e-commerce giant now has millions of square feet in use or under construction in metro Detroit.

Amazon is occupying a pair of buildings on the former Pinnacle Race Course site in Huron Township and bringing about 1,000 jobs, said John Enos, the township’s planning and zoning consultant.

The two buildings are 516,760 square feet and 752,400 square feet, according to planning department staff. The buildings, which are currently under construction at 33700 and 33701 Prescott, cost at least $47.4 million, according to data filed with the township on building permits issued in September.

Both buildings are being developed by a joint venture between Texas-based Hillwood Enterprises LP and Detroit-based Sterling Group, which have worked together on Amazon developments in Shelby Township and Detroit, among others.

A year ago, the joint venture between the two companies finalized a $4.9 million purchase of about 650 acres of land that used to be the Pinnacle Race Course. Post It Stables Inc., the previous Pinnacle owner, failed to redeem the land from tax foreclosure last year. The race track was open 2008-10 and it had been listed for sale for $8 million three years ago. The county spent $26 million during the Robert Ficano administration putting infrastructure onto the site to get the track open.

Hillwood, which is run by Ross Perot Jr., declined to comment through a spokesperson on Tuesday.

A message was sent to a Sterling Group representative seeking comment. An email was also sent to Amazon seeking comment.

In addition, the two Huron Township buildings plus another Warren building as part of the Warren Commerce Center are being sold as part of a massive $2 billion deal — reportedly the largest U.S. industrial deal by total cost during the COVID-19 pandemic — to a joint venture between San Francisco-based Stockbridge

Southfield-based Lear Corp. has listed its Lear Innovation Center building at 119 State St. in Capitol Park for sale. | COSTAR REALTY INFORMATION, INC.

“WE ARE EXCITED TO ACQUIRE HIGH-QUALITY INDUSTRIAL PROPERTIES THAT ARE WELL ALIGNED WITH OUR STRATEGY TO CAPITALIZE ON THE PARADIGM SHIFT TO E-COMMERCE.” — Scott Kim, head of the National Pension Service’s Real Estate Investment Division

and the National Pension Service of Korea. The deal overall includes 23 logistics buildings totaling 14.3 million square feet across the country, according to a press release.

A source familiar with the matter said Tuesday morning that all the buildings being sold are either occupied or will be occupied by Amazon (NYSE: AMZN), Walmart Inc. (NYSE: WMT) and Target Corp. (NYSE: TGT). Local real estate sources dispute that Amazon will be going into the Warren location. Local sources say it’s Hollingsworth.

“We are excited to acquire high-quality industrial properties that are well aligned with our strategy to capitalize on the paradigm shift to e-commerce,” Scott Kim, head of the National Pension Service’s Real Estate Investment Division, said in a press release.

The pension service has $672 billion in assets under management as of Sept. 30, while Stockbridge has $18.4 billion, according to the release.

Lear looks to unload Capitol Park building Southfield-based Lear Corp. has listed its Lear Innovation Center building at 119 State St. in Capitol Park for sale for an undisclosed price after unceremoniously vacating it.

The building is about 34,500 square feet and completely vacant.

“I know that it was Lear’s mission when they came downtown five years ago to rebuild, regenerate, revive a couple of buildings, which they did here and at 243 East Grand River,” said Jared Friedman, director of opportunities for Farmington Hillsbased Friedman Real Estate, which has the 119 State St. listing.

An email was sent to a Lear spokesperson last week seeking additional details.

Lear paid Dan Gilbert’s Bedrock LLC, the previous owner, $2.85 million for it in September 2015, according to city land records.

In October 2018, Lear sold the former Hemmeter Cigar Co. building at 243 E. Grand River Ave. at Centre Street in the Paradise Valley Cultural and Entertainment District (formerly known as Harmonie Park) to fatherand-son real estate investors Linden and Sanford Nelson in October 2018 for $13.25 million.

Lear purchased the 56,000-squarefoot building for $5.98 million in July 2015, at $106.79 per square foot. It bought the building from Detroit real estate investor Dennis Kefallinos and began a multiyear, $3.55 million renovation that was completed in 2017.

Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

THOUGHT LEADERSHIP FORUM

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OUTLOOK 2021 BUSINESS LEADERS FOR MICHIGAN

MAKING RACIAL EQUITY A PRIORITY IN A YEAR WITH MANY URGENCIES We believe Michigan should be a place that is welcoming to all, and our workplaces should reflect the diverse populations where we operate and serve. Yet it has become increasingly clear that our actions have fallen short of our aspirations.

Along with the rest of the nation and world, we watched as George Floyd’s life was taken from him—one more in a long history of tragic and senseless killings of Black people in the United States. We watched the nation’s cities erupt in protest while our communities battled a deadly virus and prepared for one of the most divisive presidential elections in history.

A message from Ron Hall, (top) President and CEO, Bridgewater Interiors, Detroit; and Andi Owen, President & CEO, Herman Miller, Zeeland

While we can’t fix every problem in our nation, we can work to influence change and make Michigan a safer and more equitable home for Black Americans. Earlier this year we put together a working group of CEOs from some of Michigan’s largest employers to begin this work.

Narrowing our scope of work was not easy—we want to make conditions better for all residents. Not only do we want to eradicate institutionalized

racism, but also sexism and discrimination based on gender and sexual orientation. However, the more we talked about it, the clearer it became that Michigan’s history and demographics compel an initial primary focus on the inequities facing its Black residents. Racism is woven into the very fabric of our country and it will require more intentional focus and effort to further unravel those threads.

We brought together a task force of a dozen members of the Business Leaders for Michigan Board, each of whom employs thousands of residents across the state. We openly shared our practices and policies relative to diverse and equitable hiring and promotion and implicit bias training.

We talked about what we, as leaders, are doing to set an example in our own companies. We signed the CEO Action Pledge. We had frank conversations and didn’t mince words.

Then, we got to work with Business Leaders for Michigan. We know that in order to solve a problem, you must first ensure your audience truly understands its scope. It is impossible for White people to walk in the shoes

of Black Americans, but we have access to experts like Tim Ryan of PwC and Darlene King from the Michigan Diversity Council, who spent considerable time helping us create a shared understanding among our board members.

Most recently, we surveyed our 90+ board members to benchmark where our member companies are in terms of leveraging workplace practices to eradicate racial inequity. Our focus is not on creating a set of “best practices,” but rather emphasizing practices that actually work. We will also incorporate new data measures into our annual benchmarking report that will lay bare the education and income gaps between Black and White Americans.

Where will we go from here? There are many suggested practices and solutions, but have they worked? We have a major problem, and we must identify the concrete steps we can take to create better outcomes. We aren’t entirely sure what comes next. We don’t know exactly what, or how big, our solutions will be. What we do know is we’ve set aside politeness and political correctness in order to get to

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“We are creating the future of growing today,” said Mark Savaya, Future Grow Solutions CEO. Growing green Growing plants—from marigolds to cannabis—typically takes a lot of patience, perseverance and resources. Future Grow Solutions, as the exclusive Michigan distributor of the CropTower™, has developed a greener approach to indoor growing operations.

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real solutions that eliminate the systemic racism and injustice that have plagued our communities for far too long.

Being part of Business Leaders for Michigan isn’t just a status. The organization brings together people who have immense opportunity to facilitate real change. Instead of letting this time of anger and frustration be a wasted opportunity, we’re at work addressing the complicated issues surrounding economic inequality and institutionalized racism in order to facilitate lasting change.

Both our companies are working hard to ensure we deliver on our promise of diverse, equitable, and inclusive workplaces, yet we both know we can do more. Our companies can, and will, continue to create meaningful change, and we will continue to work with fellow members of the Business Leaders for Michigan board to make progress together. We hope that our work will inspire and generate similar actions for employers across the state.

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HEALTH CARE

No smoking guns as Beaumont releases LOI on merger attempt 12-page document details failed proposal to merge with Advocate Aurora Health system

BY JAY GREENE

Southfield-based Beaumont Health’s letter of intent to merge with Advocate Aurora Health contains no smoking guns or controversial revelations, but the 12-page document of the terminated deal does include detailed information of the proposal that would have created a 34-hospital, $17 billion system in Michigan, Illinois and Wisconsin.

Crain’s obtained the nonbinding LOI from Beaumont and the Michigan attorney general’s office at 4 p.m.

Tuesday after filing a Freedom of Information Act request several Fox weeks ago. Two months after the two systems ended negotiations, Beaumont officially notified the AG that the merger was off.

The notification lifted the confidentiality agreement with the AG on the LOI and it became publicly available.

At 5 p.m., John Fox, Beaumont’s president and CEO, gave an exclusive interview to Crain’s in which he went through many of the LOI provisions, some of which have led to speculation about the reason for the delay from some of Beaumont’s high-powered doctors and donors who opposed the merger.

Fox said there was no intentional delay in notifying the AG that the merger with Advocate Aurora had been mutually terminated on Oct. 2. He said Beaumont executives became busy with a second surge of COVID-19 patients.

“From Oct. 15 to the middle of November our COVID population tripled.

There were certain things that had to be filed between Beaumont, Advocate and Aurora (with the three state AGs) and I was not tracking who was doing what,” Fox said.

The delay in officially terminating the deal fueled theories from physicians and donors, some of whom characterized the merger as a giveaway, that Beaumont and Advocate Aurora would restart merger talks in 2021 after things calmed down.

“We have no plans” to restart talks, Fox told Crain’s. “We said we are ending it, and we have had no conversations since Oct. 1.”

Fox did suggest that Beaumont could engage in merger talks with other health systems. “There is nothing specific at this time, but (merger talks) are constant. It is inherent in the industry,” he said, noting that health care merger activity is down by 90 percent.

“It’s called the pandemic effect.”

On June 22, Advocate Aurora and Beaumont signed the nonbinding letter of intent. Over the summer, opposition built from doctors, nurses, donors and local legislators.

In early October, Fox said the mutual decision to end more than four months of negotiations to merge with 26-hospital Advocate Aurora was primarily made because the two systems, community and medical staff leaders, and other interested parties could not meet in person because of the COVID-19 pandemic.

Fox said opposition to the merger also contributed to the decision to ter-

Beaumont considered a merger with Advocate Aurora Health this year. | BEAUMONT HEALTH

minate it. The 16-member Beaumont board of directors put a hold on talks in mid-August after several critical surveys of Beaumont management by doctors and nurses were presented to the board.

Any deal would have required a vote by the Beaumont board and signoff by Michigan Attorney General Dana Nessel. If it had been completed, the Advocate-Aurora-Beaumont system, which was called Newco in the LOI, would have become the nation’s seventh-largest not-for-profit health system by revenue, behind Livonia-based Trinity Health.

Breaking down the LOI Crain’s analysis of the LOI confirmed that the merger agreement contained a $1.12 billion investment in Beaumont over three years at $375 million annually.

Of the $1.12 billion promised to Beaumont, the breakdown on projects includes $75 million for relocation of the William Beaumont Oakland University School of Medicine from Rochester to Royal Oak; $15 million for the $45 million mental health hospital in Dearborn; $26 million to finish an urgent care center in Macomb County.

In addition, Advocate Aurora would have contributed $100 million for Beaumont’s Innovation Fund, $100 million for information technology (telehealth, artificial intelligence and applications development), $10 million for a population health initiative and $20 million for the Beaumont Research Initiative.

The LOI also said that the purchase price of acquiring an unspecified large physician practice would not be included in the annual $375 million investments by Advocate Aurora.

However, the LOI also contained an unusual “pandemic qualifier clause,” an adverse financial provision that allowed Advocate Aurora to reduce the amount Beaumont would have been funded based on financial losses the system incurred stemming from the pandemic.

In August, Advocate Aurora CEO Jim Skogsbergh said the health system was projecting a $550 million loss for the year. He said it was possible the amount promised to Beaumont in the LOI might be paid out over five years or more.

Fox explained that the LOI was written in February, a month before the

6 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

COVID-19 pandemic began hitting the Midwest when it was uncertain how bad finances might become in the health care industry.

In June, “we did not know how financially damaged we were going to be, nor did Advocate Aurora,” said Fox, adding that the pandemic clause was necessary at the time. “It was the only prudent thing to do. I don’t think anybody would do a merger today, without considering the need to adjust it, because of the pandemic.”

But Fox added if executives knew at the time that a coronavirus vaccine could be developed soon, he isn’t sure the pandemic provision would have been necessary.

As soon as possible, Beaumont plans to inoculate at its corporate office in Southfield an unspecified number of its front-line health care workers who are at the highest risk of exposure, he said.

“Back in June, we didn’t know when a vaccine might be available. (Experts) were talking about maybe at the end of 2021,” Fox said. “The only way to go forward (with the merger) was to acknowledge we are in the middle of a pandemic” and that financial losses were expected to mount.

“WE HAVE NO PLANS (TO RESTART TALKS). WE SAID WE ARE ENDING IT, AND WE HAVE HAD NO CONVERSATIONS SINCE OCT. 1.”

— John Fox, Beaumont’s president and CEO

In fact, Fox said Beaumont was forced to terminate the merger proposal in May with Akron, Ohio-based Summa Health because its revenue was down 52 percent. He said Summa refused to agree to a pandemic provision and the possibility of fewer dollars coming from Beaumont.

Fox was asked if agreeing to a pandemic provision to let Advocate Aurora off the hook in funding Beaumont investments made the merger less valuable to the community.

“It can, but let’s go through the math,” he said. “We had averaged spending $260 million a year of capital for the prior three years. And like a lot of systems in Michigan, we were strug-

gling for replacement equipment and other things we need for patient care.”

Fox has said one major reason for Beaumont to seek a merger with a larger and successful health system was to tap into Advocate Aurora’s financial resources.

Under the LOI, Fox said Beaumont’s annual capital funding would have gone up $115 million a year by partnering with Advocate Aurora, a clear win.

“The LOI never got finalized (in a definitive agreement). We were going to revisit that and get better numbers,” said Fox, adding that Beaumont would have wanted to negotiate a higher investment number from Advocate Aurora in the final agreement as the financial losses were slowing.

The LOI included a provision that the definitive agreement would be signed by July 15, only 30 days after the LOI was approved.

Fox was asked why that was so quick and whether that indicated Advocate Aurora and Beaumont planned to sidestep the discussion process with physicians, community members and the public.

“The lawyers thought it could get done in 30 days. Within a week (after signing the LOI) we realized it would take longer,” said Fox. Fox was asked if he felt he made any mistakes in describing the merger proposal to the public, doctors or donors.

“Not that I know of. There were a lot of things said verbally. Some could have been misconstrued, but there was nothing intentional,” Fox said.

During the summer, Fox held multiple Zoom and in-person meetings with doctors and donors to explain the merger. While some doctors seemed to support the merger, the majority of doctors appeared not to like it.

For example, one of Beaumont’s top cardiologists, Dr. Robert Safian, expressed concerns publicly about the merger, how cost-cutting was affecting quality and safety, leading to top physician departures, and called for the board to replace Fox. Over that time period, physicians, nurses and donors expressed a deepening dissatisfaction with Fox, COO Carolyn Wilson and Chief Medical Officer Dr. David Wood Jr. They described to Crain’s a number of management decisions they say led to cost-cutting, low morale, inadequate staffing, and a lack of critical supplies and equipment at hospitals.

In separate medical staff and nurse surveys during late July and August, 76 percent of 1,555 physicians said they had no confidence in corporate management and 70 percent expressed opposition to the merger with Advocate.

An even greater percentage of nurses expressed lack of confidence in management (96 percent) and opposition to the merger (87 percent).

Some donors also have come out against Fox and his top lieutenants.

Three donors told Crain’s they are concerned about a decrease in the quality of the medical staff, including more than 50 departures of top doctors.

Other concerns raised by Beaumont donors, doctors and local legislators had to do with reserved powers and governance of legacy Beaumont after the merger.

Under the LOI, Beaumont would get five directors on the new 15-member Advocate-Aurora-Beaumont board, but there would not be a legacy Beaumont chairperson for the first four years. The first chair would be from Advocate, the second from Aurora and then Beaumont. Each chair would serve two-year terms.

Fox said Beaumont would not be disadvantaged by waiting its turn.

“The chair does certain things but it’s not like being chair in a publicly traded company,” said Fox, noting that Beaumont would have had chairs in three of the nine committees of the board, including finance, quality and safety, and strategic.

Another aspect of Beaumont joining a larger organization is giving up final decision making and instead having reserved powers. For the first seven years, Beaumont’s local reserved powers would be limited to reviewing and recommending capital and operating budgets, quality and safety and strategic plans.

“Advocate, Aurora and Beaumont.

It’s a single organization. It all has to add up. I don’t know of any merger where any party retains the ability to totally control their own budget. You might as well not have a merger,” said Fox. Another provision in the LOI covered possible sale of assets of Beaumont properties or services. During the first four years, the newly merged system could not sell any Beaumont asset, including a hospital or medical center, unless three of the five legacy Beaumont members approve the decision. Community leaders and doctors have been concerned that Beaumont might want to sell its Wayne or Trenton hospitals, a move that Fox said hasn’t been under consideration.

Finally, the issue of who would be CEO of the newly merged entity was addressed in the LOI. The document makes it clear that Skogsbergh would have remained CEO of Advocate-Aurora-Beaumont.

If the merger would have been completed, and even now, Fox said he plans to remain on as Beaumont’s local CEO at least until his contract expires in 2022. Contrary to a well-publicized rumor, the LOI contained no “golden parachute” clause that would have given Fox $20 million or more if he left after the merger was completed.

“Contracts can be extended. ... It’s hard to predict the future,” he said.

Contact: jgreene@crain.com; (313) 446-0325; @jaybgreene

Moving forward as a community The pandemic and humanitarian crisis has brought us together with intensified passion and resilience. At Bank of America, we remain focused on supporting the well-being of our teammates, providing the essential financial services our clients need and helping local communities across the country move forward.

Here in Detroit, we’ve donated masks to local partners to distribute to those most at risk.

We’ve provided lending to local small businesses through the Paycheck Protection Program (PPP) to help strengthen our local economy. And we continue to partner with local nonprofits and organizations that are working to advance racial equality and economic opportunity in the communities we serve.

We’re grateful for our employees, who have worked tirelessly to support our clients. And we are especially grateful to the healthcare and essential workers who have helped Detroit recover.

My teammates and I remain fully committed to the work to come in 2021 and beyond.

Matt Elliott Detroit Market President

Working together Grateful for our partners in Detroit who gave our community support when it needed it most.

200,000 PPE masks donated 4,805 PPP small business client loans totaling $389 million Bank of America employees

To learn more, please visit bankofamerica.com/community

Bank of America, N.A. Member FDIC. Equal Credit Opportunity Lender. © 2020 Bank of America Corporation. All rights reserved.

COMMENTARY

PPP shaming speaks more to program flaws than recipients Nick

MANES

$130 billion still available. A second tranche of $310 billion became available in late April after the first pot of money was gone in just a matter of weeks.

None of this is to say that the PPP was without flaws. Indeed, part of the reason the second pot of money languished for so long and went unused is due to flaws with many businesses feeling they could get by without the headaches associated with the loans, particularly as the nation’s economy reopened in the late spring and summer.

As my colleague Dustin Walsh laid out this summer, the program was mostly made up on the fly as the nation’s proverbial house was burning down with COVID-19 spreading like a wildfire and the economy in free fall.

While the speed with which the PPP was rolled out created some chaos and confusion, the upshot was speed, simply put. Businesses were able to get a relatively quick injection of capital from their existing lender.

Other challenges continue to linger. Banks and accountants are now working on the daunting task of getting their clients’ loans forgiven, which entails showing that businesses lived up to their end of the deal — simply keeping employees on the payroll.

Some of the loans could go to other costs of doing business such as rent payments and utilities, but most had to go to payroll.

Forgiveness of loans has been slow to materialize. As of Nov. 22, lenders have submitted approximately 595,000 PPP loans for forgiveness and more than 367,000 payments have been made toward those loans, according to the most recent data from the U.S. Small Business Administration.

Business groups and banks for months have called on Congress to either vastly simplify the forgiveness aspect, or outright forgive the vast majority of loans with the assumption they were needed to survive and therefore taken in good faith.

Congress so far has not heeded those calls, but another round of PPP dollars is gaining headway in Washington, D.C., as more stimulus appears on the horizon.

Calley said he’s supportive of another round of loans, but would like to see the intended recipients narrowed down to businesses still impacted by shutdowns. Namely, bars and restaurants, movie theaters and other entertainment venues, among others.

Regardless, what’s important to remember is the goal of the Paycheck Protection Program. As stated in the name, the point was keeping a paycheck going to workers, regardless of whether they’re actually able to work.

With unemployment still at elevated levels, both nationally and at the state level, that’s a goal we should all support.

Nick Manes is a Crain’s Detroit Business reporter who covers finance and technology.

DANIEL SAAD

A data dump by the U.S. Small Business Administration of recipients of pandemic bailout funds has led to renewed questions about the landmark Paycheck Protection Program.

A key component of the $2.2 trillion federal CARES Act in the spring, the well-intentioned yet deeply flawed program, aimed to provide potentially forgivable loans to a litany of small businesses across the country provided they keep workers on the payroll.

But the latest batch of disclosures, which named in multiple spreadsheets the tens of thousands of companies to receive PPP loans of less than $150,000, has sparked renewed debate about who truly benefited from the program.

Outlets including The New York Times and Washington Post posted stories noting that most of the dollars went to bigger businesses.

To be sure, reasonable people can disagree over whether a large restaurant chain like TGI Friday’s was truly in need of a PPP loan. But missing from many of these stories is a simple fact: The program was designed specifically to get appropriate-size loans to companies of a variety of sizes with the clear intent of ensuring workers kept receiving paychecks.

In applying for the loans — which were widely available and technically limited to businesses of 500 employees or fewer in most cases — business owners simply provided payroll information to lenders. The larger a business’ payroll, the larger the loan it would receive, up to a limit of $10 million.

Therefore, it should come as no surprise that the larger chunk of the loans went to companies with larger workforces.

That brings us to the larger point: For all the consternation about chain restaurants and large corporate law firms getting PPP THE PROGRAM — even if they WAS DESIGNED loans did use loopholes of TO GET LOANS TO simply having fewer 500 employees COMPANIES OF A than in one location and then more in another VARIETY OF — there’s no evidence SIZES WITH THE that doing so prevented others from obCLEAR INTENT taining loans.

OF ENSURING Just ask Brian Calpresident of the WORKERS KEPT ley, Lansing-based Small RECEIVING Business Association of Michigan. Calley, a PAYCHECKS. former Republican lieutenant governor of the state and small business banker, has been perhaps one of the most vocal advocates for policies and programs favorable to Main Street businesses during the pandemic.

“I don’t know of any business who did not receive PPP funding because of some other entity getting it,” Calley said.

(Disclosure: Detroit-based Crain Communications Inc., the parent company of Crain’s Detroit Business, received a PPP loan of $10 million, records show.)

The first tranche of dollars, valuing $349 billion, came available on April 3.

To Calley’s point, the Paycheck Protection Program expired in August with more than

LETTERS TO THE EDITOR

Column paints women as victims TO THE EDITOR In regards to Kelley Root’s column, “For women in the workforce, a crisis employers must address,” it strikes me as a demand, all or nothing.

Further, the comments are not what I would agree is a responsibility or the fault of the employer: “Covid can be a career killer. …

The pandemic’s unique stresses on female employees … Workplaces suffer without women’s voices … Making workplace flexibility the norm — not the exception. … Working mothers are three times more likely than working fathers to be responsible for household labor.”

I am a second-generation owner in a family business. My focus is not only to remain

What are Michigan’s leaders thinking?

TO THE EDITOR: Rosalie Vicari was absolutely correct in everything she said in her letter “Here’s what a pause means, and who is affected.”

The Vicari group owns the best restaurant/ bars in the Tri-county/Detroit area and IF this ridiculous shutdown takes them out and destroys some of the premier eating establishments here in Southeast Michigan how will that industry recover??

Will the governor be held responsible for ALL those people who turn to drugs, alcohol and, sadly, suicide as they watch their lives being destroyed and they can do nothing about it? What in God’s name is wrong with these government dictators?

I hope the people of Michigan understand why this has been done and why ALL the Democrat controlled states refuse to back off of their wrong-headed, stupid decision to shutdown their economies.

We have been lucky in comparison with the restaurant/bar businesses since our

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 | DECEMBER 14, 2020

reasonably profitable for all employees, regardless of gender, but to also keep the American Dream alive and growing.

However, this is not compulsory. Your article demands that employers bear the duty to fix all of real or perceived circumstances women face. Most business owners or leaders (men and women) do their level best for all employees and want to see them progress professionally and live the American Dream.

My takeaway from your article is women are victims with no choices. I disagree. We still live in a society full of choices.

Some are dealt circumstances beyond their control but most I think are within change they can make themselves and if they cannot, help is available.

Mike Preston

customer base manufactures trucks, cars and other vehicles, and some of those are emergency vehicles, so we have been able to continue making parts for them.

However, I have friends who have already lost everything and more who are about to as Whitmer and her cabal of know nothings continue on down this destructive path of shutdown after shutdown no matter what happens to the people of Michigan. This in response to a disease that has a 99.7 percent recovery rate. What are they thinking? Oh wait they can’t think ... rationally, anyway.

Jeffrey Scott

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.

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

United we stand for talent, for equity, for Detroit

BY BILL MOSES AND PUNITA DANI THURMAN

Now, perhaps more than ever, is the time to remember that there is a lot more that unites us than divides us.

Thriving households, strong businesses, and Bill Moses is safe neighbormanaging hoods are things director of the we all aspire for.

Education We share a comProgram at mon vision and a The Kresge common fate.

Foundation.

And even though today’s political climate may suggest otherwise, we even share common agendas.

Through the leadership of the Detroit Regional Chamber, businesses, colleges, Punita Dani K-12 systems, Thurman is the nonprofits, state vice president leaders and founof program dations are pledgand strategy at ing to adopt stratThe Skillman egies that will Foundation. position our region to achieve two goals: 1) reaching 60 percent degree or credential attainment and 2) reducing the racial equity gap by half. We aim to do both by 2030. With a unified approach, it can be done.

Our region is brimming with talented neighbors who are eager to learn and work. We also have businesses, and entire industry sectors, eager to employ people with specialized education and training. What we lack is a coordinated, multisector approach to prepare and connect our people to our places of work. The recently announced Detroit Regional Talent Compact marks a turning point in our region’s efforts to answer that need.

The Kresge and Skillman foundations have long supported efforts to strengthen pathways to college and career, with particular focus on ensuring people of color and those from less resourced communities can access and succeed in postsecondary pursuits. But while philanthropic dollars are useful for supporting innovation, expanding best practices and filling gaps, solving the problem takes a widespread commitment. And the commitment must be to the intended results, not just to the inputs.

Success cannot be measured by dollars invested or number of people who enter postsecondary education. Success must be measured by the outputs — the percentage of people who obtain a degree or certification, with attention to building a system that helps all of us flourish. We must hold the expectation that all of us will be educated and skilled, and that prosperity will not only be destined for the affluent or the lucky few who “beat the odds.”

Consider this: Roughly half of Southeast Michigan residents who pursue a college education do not earn a certificate or degree within six years of graduating from high school.

This finding alone is troubling. But a closer read of the data reveals stark racial disparities. Only 26 percent of enrolled Black students, who are more likely to grow up in under-resourced

communities, earn a college degree Southeast Michigan hold a postsecwithin six years compared to 60 per- ondary degree or certificate, but 80 cent of white students. This represents percent of jobs require some educaone of the largest racial equity gaps in tion beyond high school. That’s less postsecondary attainment nation- than half of our working-aged populawide. These outcomes are simply un- tion competing for the vast majority of jobs. And that acceptable, parmeans we have a ticularly in a OUR REGION IS BRIMMING twin problem: region that is as of rich in racial di- WITH TALENTED NEIGHBORS hundreds thousands of versity as ours.

WHO ARE EAGER TO LEARN people without These numthe necessary bers are not a fail- AND WORK. skills to fill jobs ure of our students. Instead, they reflect a failure in that go unfilled — and hundreds of our system and of our expectations of thousands of people who are unable to access the employment opportuniour system.

Currently, 47 percent of people in ties and experience the prosperity

that often comes with greater educational attainment.

The Detroit Compact seeks to address both challenges. Employers in the Compact will expand apprenticeship programs for city of Detroit residents. K-12 institutions have committed to provide more equitable access to dual enrollment and early college opportunities. Higher education institutions have agreed to scale institutional debt forgiveness efforts, which have an outsized impact on Black adult returning students. Funders including the Ballmer Group, Detroit Children’s Fund, Jamie & Denise Jacob Family Foundation, Kresge Foundation, Ralph C. Wilson Jr. Founda-

tion and The Skillman Foundation have pledged $18 million to support the implementation of the Compact’s strategies. But we can’t succeed without an even larger coalition of partners from every sector, especially innovative businesses.

We must act now. The goal of reaching 60 percent degree or credential attainment by 2030 has been adopted by states and regions across the country, with Michigan among the last to adopt it. Let’s not be last to achieve it.

If your organization would like to join the Compact, contact Melanie D’Evelyn of the Detroit Regional Chamber at mdevelyn@detroitchamber.com.

INDUSTRY ACHIEVERS ADVANCING THEIR CAREERS

Recognize them in Crain’s

For listing opportunities, contact Debora Stein at dstein@crain.com or submit directly to

CRAINSDETROIT.COM/PEOPLEMOVES

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 9

OUTLOOK 2021

What’s behind door #2021?

Nothing is certain but uncertainty in the year ahead

G:AURIS VIA ISTOCK

How do you make a forecast after a year that defied all forecasts? Every year we ask business leaders, economists and others on the vanguard to give us their outlook for the year ahead. None of them had “global pandemic turns the world upside down” in the cards for 2020.

But a few things seem to be coming into focus: How work will change. What an economic recovery could look like. The changes a new presidential administration might bring to health care policy, higher education and more. And that nothing will be quite back to “normal” in 2021, but in some ways, that may be a good thing.

JIM ADOX MANAGING PARTNER, VENTURE INVESTORS LLC

Look for more health care investment in 2021

BY NICK MANES

So much of 2020 was about health care: people’s access to it — or lack thereof — and the cracks in the system that the coronavirus pandemic laid bare.

The virus that ripped across the globe for the entire year became a tragic death sentence for many with common ailments like elevated blood pressure, asthma or diabetes. Next year, there’s likely to be a need for further investment into new technologies, treatments and therapies, said Jim Adox, the Ann Arbor-based managing partner for Venture Investors LLC, a health care-focused venture capital fund out of Madison, Wis. Adox said that he also expects the new administration of President-elect Joe Biden is likely to push for increased access to health care.

“We can expect he’s going to do as much as reasonably possible to further that and improve on it,” he said. “He might be limited to only the executive powers if the government is divided, but I think he’s gonna go that route.”

Like much of the rest of the economy, investment activity took a pause in the spring as COVID-19 took hold, but Adox said it quickly ramped back up and he expects that will continue in the coming year.

“We saw that health care is going to continue, it’s not ending, it’s not like the telecom nuclear winter,” he said. “And then we also saw most of our startups that we already invested in responded really well in how they had to adapt, to work under COVID, to stay safe, to stay within the law and all the restrictions ... COVID showed the importance of having good health care, both on a personal level and on a country level.”

10 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

“WE SAW THAT HEALTH CARE IS GOING TO CONTINUE, IT’S NOT ENDING, IT’S NOT LIKE THE TELECOM NUCLEAR WINTER.” — Jim Adox

FOCUS | OUTLOOK 2021 LINDA APSEY CEO, ITC

Massive transformation for energy industry on horizon

BY CHAD LIVENGOOD

While ITC Holdings Inc.’s field crews were adapting to a new world of PPE and an increase in residential electrical use in 2020, the Novi-based electric transmission company’s engineers were thinking a lot about the forthcoming transformation in the way electricity is generated, transmitted and stored.

ITC CEO Linda Apsey said the multi-state owner and operator of high-voltage power lines has filed an application with the Federal Energy Regulatory Commission for a pilot project to build the infrastructure needed for mass fast-charging stations for electric vehicles.

This pilot project will look at designing what could become the gas station of the future — and then it will have to be scaled by an investment in the electric transmission system not seen in generations, Apsey said.

For all of the changes ITC’s 550-employee Michigan workforce endured in 2020, the obstacles ahead in the shift to more sources of renewable energy and a higher dependency on electric-powered energy is “the single largest transformation” in the energy industry since the initial electrification of the country a century ago, Apsey said.

“I often say somewhat flippantly, if this country is going to love renewables, they’re going to have to start liking transmissions because you cannot have renewables without transmission. I mean, we are the integrator, we’re the facilitator and we are the delivery of that renewable energy. For that, obviously, it certainly presents challenges in terms of we have regulatory rules and statutes and policy that reflect how the utility business operated over the last century. We don’t necessarily have the rules and regulations for the next century. So certainly there’s challenges in terms of how we shift our policies to sort of facilitate all of this renewable (electricity) transmission. But at the same time, from a business perspective, certainly all of that provides opportunity for growth in our business.”

“I OFTEN SAY SOMEWHAT FLIPPANTLY, IF THIS COUNTRY IS GOING TO LOVE RENEWABLES, THEY’RE GOING TO HAVE TO START LIKING TRANSMISSIONS BECAUSE YOU CANNOT HAVE RENEWABLES WITHOUT TRANSMISSION.” — Linda Apsey

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 11

FOCUS | OUTLOOK 2021 SAMANTHA DANEK PHYSICIAN ASSISTANT

KOFI BONNER CEO, BEDROCK LLC

What will office work look like post-pandemic?

BY KIRK PINHO

“MY EXPERIENCES HAVE LED ME TO UNDERSTAND THAT OUR PATIENTS DESERVE BETTER CARE.” — Samantha Danek

Health care workers are ‘fighting back hopeless feelings’

BY JAY GREENE

Physician assistant Samantha Danek has seen the ravages of COVID-19 on the front lines as she was redeployed from neurosurgery this spring to care for patients on specialized units at Henry Ford Allegiance Health in Jackson.

Born and raised in Ypsilanti, Danek received a master’s degree in physician assistant studies at Wayne State University in 2009. As the COVID-19 pandemic struck, she began pursuing another master’s in health administration at the University of Michigan.

“My experiences have led me to understand that our patients deserve better care,” said Danek, who has specialized in emergency medicine, hospitalist medicine and now is back working in neurosurgery.

But Danek said she is disheartened by the number of people who refuse to wear masks and say they do not believe masks help reduce the spread of coronavirus.

“It is a simple thing to wear a mask.

Whatever your thoughts are on it, just wear it because there are so many people hurting and it’s the least we can do to protect people” and also health care workers, Danek said.

During this fall surge, hundreds of health care workers have tested positive for COVID-19. Contact tracing has shown the majority of

providers contracted the virus in the community, not at work.

Danek said the increasing volumes of patients coming into hospitals for COVID-19 has everyone guessing how bad it might get this winter and into the spring before a vaccine can stop the spread. Meanwhile, the human toll continues to mount.

“My last patient was an elderly lady from a rehabilitation facility who recently had major back surgery. Her daughter met her for the appointment and it was the first time she saw her in six weeks. The mother was not doing well. My patient hesitated coming to the appointment because she didn’t want to get transferred to the emergency room. Of course, that was my recommendation. The daughter asked me to give her a minute because she knew she couldn’t go to the emergency room with her mother. She just hugged her like it was the last time she was going to see her. We are seeing this too often. It is just heartbreak and devastation to us and patients in the community.

“We all knew this was going to be a marathon. Nothing can prepare you for this type of uncertainty. ...

We continue to lean on each other for support to fight back hopeless feelings. This too will end and then we can really focus on supporting preventative care and self care, which does not come naturally to many providers like us.”

12 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

“WFH” is more than just shorthand you use to let your boss know you won’t be in the office today. In 2020, as a global pandemic tore holes in thin societal fabrics and people’s personal and professional lives, it has become a way of life for many office workers who are able to earn their paychecks from the comfort of their own homes.

That has caused office users — and their landlords — to start to rethink their space.

How much will they need in the future, as workers have grown accustomed to their home offices or setting up laptops on their kitchen tables? How will it be configured?

Will the decades-long trend of shrinking office footprints slowly begin to bend back the other way in favor of socially distanced space?

Will any major local office users ditch their digs entirely in favor of remote working?

For Kofi Bonner, the new CEO of Dan Gilbert’s Bedrock LLC real estate company that owns and manag-

es more than 6 million square feet of office space, primarily in downtown Detroit, the answer to addressing the office conundrum is somewhere in the middle.

“We think we have a really good understanding of what workers will need to come back to their office space. ...

There’s no question that the majority of people are getting to understand that, at some point, they’ll be spending some portion of their work space from home, even post-pandemic, after the World Health Organization on that thankful day declares that the pandemic is done.

“But we’ve learned a lot in this process, and one of the things we’ve learned is that folks actually can work from home and can work from home fairly efficiently and effectively. But we’ve also learned that working from home exclusively may not actually be in the best interest of the workers and ultimately, the businesses. So we’re all thinking about the right balance. And there’s some really interesting and intriguing thinking around how to create that right balance.”

DARIENNE HUDSON PRESIDENT AND CEO, UNITED WAY OF SOUTHEASTERN MICHIGAN

Nonprofits have to evolve, collaborate

BY SHERRI WELCH

Even before the pandemic, United Way of Southeastern Michigan and many of the nonprofits it funds were working to address unmet basic needs in the region.

Need has surged this year with people put out of work by business closures and cutbacks. For the first time in their lives, many people have had to ask for emergency assistance, President and CEO Darienne Hudson said.

United Way raised more than $37 million for COVID relief in Southeast Michigan this year to support basic needs initially. It’s now funding secondary needs like digital access, workforce development and health care.

Need is expected to keep rising with ongoing business pauses and closures and the winter months — and higher heating costs — ahead.

The need to provide emergency assistance while also addressing the root causes — like generational poverty, lack of employable skills and racial injustice — that have left people unable to meet their basic needs in the first place will continue to challenge nonprofits as they themselves work to stay afloat, Hudson said.

“One of the biggest challenges for our sector going forward will be our ability to both respond to immediate crisis — the pandemic, flooding and racial unrest — but also get our communities to a place where they are much more stable and resilient. We are still in this pandemic, and we still need to be thinking of response to the crisis. But always our charge is thinking long term, how we get people to a point of stability. We have to be innovative in how we are approaching these different societal issues.

“Trying to do things the way they’ve always been done wasn’t working before the pandemic and isn’t now. We can’t continue to work as independent organizations and expect different results. We have to evolve. As resources become more scarce and as needs continue to rise exponentially, you have to start figuring out how you can share resources and bring different organizations together around these common issues. You’re going to continue to see from the sector more of these cross-functional, multiorganization partnerships. We are better together if we are able to share resources, really mobilize together, work toward common goals and even fundraise together.”

“WE THINK WE HAVE A REALLY GOOD UNDERSTANDING OF WHAT WORKERS WILL NEED TO COME BACK TO THEIR OFFICE SPACE.” — Kofi Bonner

“TRYING TO DO THINGS THE WAY THEY’VE ALWAYS BEEN DONE WASN’T WORKING BEFORE THE PANDEMIC AND ISN’T NOW.” — Darienne Hudson

HAVE

NG KERS OME

Y S SN’T RE

”

FOCUS | OUTLOOK 2021 ROB FOWLER CEO, SMALL BUSINESS ASSOCIATION OF MICHIGAN

‘Uncertainty is the theme for next year’

BY JASON DAVIS

Small Business Association of Michigan CEO Rob Fowler has worked in the sector for about 20 years and he believes next year will be a crapshoot for those in the small business sphere. Fowler said 2021 is a hard year to predict, mostly because of the ongoing pandemic.

“Uncertainty is the theme for next year. Uncertainty is terrible for business,” Fowler said. “The challenge we have is that the economy was so good on March 10, and there’s reason to believe we can get back to that pretty quickly, but the longer (the pandemic) goes on, the less likely that is to be true.

“I think there are going to be some fundamental transformations we haven’t fully embraced yet. Working from home is a big one. People are being productive and making it work. That has implications on downtowns and commercial real estate. Downtowns need office workers to support restaurants — in big and small towns. The possibility of bankruptcies in the commercial real estate space really exists. We could go from low supply/high demand to almost the opposite. Shopping is another area. People have learned to get everything online. I don’t think that’s good for small, local retail. It’s really going to take people being loyal to local retailers or those retailers won’t be around.”

“I THINK THERE ARE GOING TO BE SOME FUNDAMENTAL TRANSFORMATIONS WE HAVEN’T FULLY EMBRACED YET.” — Rob Fowler

GET A HEALTHIER OUTLOOK ON CHILDHOOD Tune in to WJR 760 AM for Caring for Kids, a monthly radio program highlighting issues and efforts locally, regionally and nationally, that impact the health and wellness of children.

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Tuesday, December 22 at 7pm

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yourchildrensfoundation.org/caring-for-kids DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 13

FOCUS | OUTLOOK 2021 FELECIA PRYOR EXECUTIVE VICE PRESIDENT, CHIEF HUMAN RESOURCES OFFICER, BORGWARNER

“IT’S TIME FOR ORGANIZATIONS TO SHOW WHAT THEY’RE GOING TO DO THROUGH THEIR ACTIONS.”

PETER MCPHERSON PRESIDENT, ASSOCIATION OF PUBLIC AND LAND-GRANT UNIVERSITIES

Higher education shouldn’t go back to business as usual

BY KURT NAGL

Higher education will never be the same, and that’s all right, according to Peter McPherson, president of the Association of Public and Land-grant Universities. In his nearly five decades of work in government and education, including serving as president of Michigan State University 1993-2004, McPherson said he’s never seen a greater challenge, or greater opportunity, than the one brought on by the COVID-19 pandemic.

Michigan universities and colleges are in financial distress just as students deprived of the college experience are in social distress. As long as we’re being tested with a life-changing phenomenon, we might as well take away some lessons, McPherson said. Adaptability is key — that’s a no-brainer, for any business sector.

Accessibility, though, is one area where higher education has always struggled. The pandemic led to the fine-tuning of remote delivery, and it produced new financial aid programs such as Futures for Frontliners. It also laid bare universities’ reliance on foreign students. When COVID releases its grip, administrators would be wise not to go completely back to “normal,” McPherson said.

— Felecia Pryor

“THIS IS THE BIGGEST THING THAT’S HAPPENED SINCE THE RISE OF THE BIG UNIVERSITIES AFTER WORLD WAR II.” — Peter McPherson

“This is the biggest thing that’s happened since the rise of the big universities after World War II … I don’t think that schools will ever return to exactly pre-pandemic, even with a vaccination, because we’ve learned some things on how to operate. I’m convinced there will be more hybrid courses. I think classes can be enriched, actually, by that combination … The Biden administration has talked a lot about more resources to states and to universi-

ties. I think there’s broad interest in doubling Pell (federal student financial aid program). I think there’s going to be a reversal of much of these negative actions concerning international students. We’ve gotten downright discouraging of international students coming here. We’ve had a huge dip in international students, and I think that will change. I think there is bipartisan interest in more research. That will be good for Michigan.”

ERIC WILLIAMS SENIOR STAFF ATTORNEY, DETROIT JUSTICE CENTER

Expect an unequal recovery for small businesses Are we lending a voice to change?

BY DUSTIN WALSH

The COVID-19 pandemic unraveled traditional work. Coupled with high-profile police killings of Black Americans in several cities, social unrest poured over. Citizens took to the streets. Protests, and in some cases riots, erupted across the U.S. after the killing of George Floyd in Minnesota in May. The result was a complex, and often politicized, set of maneuvers by companies to address racial inequality in their own ranks as the outside world looked on closely. Professional sports leagues and even major brands faced backlash over support of Black Lives Matter and other organizations. The unrest also led to violence, and the country appeared to fall further into division.

But Felecia Pryor, executive vice president and chief human resources officer for Auburn Hills-based auto supplier BorgWarner, said there’s room for optimism.

“The death of George Floyd, it was because we were in this COVID crisis, and working from home and sit-

ting still and in the events in the moment, that we were able to face this.

We were able to recognize all that that situation meant. We’re all keenly focused on what’s happening in the news world. Then a man loses his life on national television ... We were really able to get a grasp of that. Around this social unrest, we had to ask how we are leaning into this as businesses. Are we lending a voice to change?

Often business is the driver and the shift maker for change. I think from an HR standpoint, us helping toward meaningful change is going to be critically important. To make sure no person is left behind. What can help make a societal shift? There’s still a lot of divisiveness in this space. But we can start making decisions where we can see change. It’s time for organizations to show what they’re going to do through their actions. That’s increasing representation in board rooms and on leadership teams.

Even hiring of younger talent. These things have been happening, of course, but now we need to expedite it. This doesn’t need to seem so bold anymore.”

14 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

BY ANNALISE FRANK

Eric Williams, a lawyer working in social justice and economic equity, says what small Detroit businesses experience in 2021 will depend, like the entire nation, on COVID-19 vaccines and government stimulus.

But recovery won’t play out the same everywhere. He sees a recovery for small Detroit businesses that’s slower than that of the region, due to lack of capital, racial disparities and without a lot of help from city-level government as Detroit faces its own financial shortfalls.

Williams, a Detroit native, is a senior staff attorney in the Detroit Justice Center’s economic equity practice.

“There were two pandemics, when you think about it. There’s one for professionals who were able to work from home, and then everybody else.

For businesses, it’s the same thing.

“Detroit is in a particularly odd spot because, first of all, a quarter of all small businesses are in leisure, restaurants, hotels, entertainment, personal services. Those are the ones that were hit hardest. On top of that you had the ... racial disparities in health care that really made Detroit get hit harder.

“So ... there will inevitably be two tracks for recovery and, unfortunately, most of Detroit’s small businesses will probably be on the slower track.

“It’s kind of a mixed bag because

“SMALL BUSINESSES THAT ARE ABLE TO ADJUST TO THAT WILL THRIVE. THAT PUTS DETROIT SMALL BUSINESSES WHO HAVE ALWAYS HAD ISSUES WHEN IT COMES TO ACCESSING CAPITAL IN A DIFFICULT POSITION.” — Eric Williams

on the one hand ... there’s pent up demand and they’re going to see that begin to open up I think probably second quarter of next year. But on the other hand, people have less discretionary income.

“I don’t think things will ever go completely back to normal. Small businesses that are able to adjust to that will thrive. That puts Detroit small businesses who have always had issues when it comes to accessing capital in a difficult position.

“I am actually optimistic because crisis spurs innovation and Detroit

small businesses, and particularly the Black business community, is about as used to crisis as any community you’re going to encounter.

“What we’ve seen is an increased interest in alternative business and economic approaches, so a lot more interest in cooperative businesses.

Community-led development and ownership is a big thing where the community itself, in the form of a nonprofit or a collection of for-profit private community based organizations, working together to identify what the community needs are.”

CIOS THE RECOGNITION THEY DESERVE GIVE GREAT

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WOMEN IN LEADERSHIP

Kathy George on running a casino during COVID

The CEO of FireKeepers Casino has devoted her career to service. The pandemic didn't change that years. It’s been great. A tribally owned business is really a family business. I feel that even though it might not be giving back to my dad or mother’s tribe, at least it’s still giving back to a tribe and making a difference on a smaller scale. From the day I interviewed to when I started, I felt it was a good fit. They respected me and I respected them. It formed a great partnership and relationship.

BY RACHELLE DAMICO | SPECIAL TO CRAIN’S DETROIT BUSINESS

Kathy George learned she loved hospitality while growing up on a reservation of the Seneca Nation of Indians in Irving, N.Y. During high school, George worked as a line cook and cashier at the reservation’s bingo hall, where she discovered a love for serving people.

“I was fortunate to fall into it,” she says of her now more than 29 years as a hospitality executive, including experience in hotel and casino operations, budgeting, team building and managing revenue and expenses.

Today, she’s the CEO of FireKeepers Casino and Hotel in Battle Creek.

The casino and hotel, which opened in 2009, is an eight-story, 243-room hotel owned by the Nottawaseppi Huron Band of Potawatomi.

FireKeepers is one of the largest employers in Battle Creek and employs more than 1,700 people.

FireKeepers is an important pillar of the Battle Creek community. The FireKeepers Local Revenue Sharing Board, which is made up of representatives from local governments, distributes funds received from FireKeepers’ annual net earnings each year. Since FireKeepers opened, it has provided nearly $200 million to the state, local governments and area schools.

George leads some of these efforts, including The Fire Hub in Battle Creek, a counter-service restaurant FireKeepers purchased and redeveloped in 2015 that’s housed in a historic fire station. Within the Hub is the Kendall Street Pantry, which George also oversees. The pantry is run by FireKeepers Casino in partnership with the South Michigan Food Bank in Battle Creek.

George also leads the Greenhouse and Community Garden in nearby Athens, which serves fresh produce for Athens area schools and families in need.

“The most rewarding part (of my job) is the positive impact that we make every day on our employees, our guests, the tribe, and the community as a whole,” George said.

FireKeepers is currently in the process of expanding, building a new 203room hotel tower that is expected to open in early 2021. The tower will bring FireKeepers’ hotel room count to 446 rooms. The casino is also adding an additional gaming space, lobby, bar and a new concourse.

“We look forward to being able to bring more people to the region to Battle Creek,” George said. “Our goal is to help make the community bigger and better.” `How did your upbringing influence your career?

I grew up in western New York on Cattaraugus Reservation. My father was an enrolled Seneca and my mother was part Mohawk from Six Nations in Ontario, Canada. My dad was always big on using whatever skill or trait you have to hopefully give back to the tribe. When I was in high school, I worked in our bingo hall on the reservation. That’s where I learned that I liked dealing with the public. I enjoy serving people and making them happy.

I knew at that point that I was looking at the hospitality industry, I just didn’t know exactly how. I was fortunate to attend a career night in high school, where I met a woman who was an alumni of Cornell’s

School of Hotel Administration. She told me she ran a catering business and how much fun it was. I said, ‘Well, I could do that.’ That’s how I ended up in the hospitality industry. `You started at Wyndham right out of college and worked there for over a decade, then you moved back home to work for the Seneca tribe. Why did you make that decision?

When I left, Wyndham was changing.

It’s a whole different company now. It was bought, broken up into pieces and sold off. At that point, I decided it was a great time for me to return to the Seneca tribe to give back. I went to help open a hotel on Niagara Falls (Seneca Niagara Resort & Casino in Niagara Falls, N.Y.) and to open Seneca Buffalo Creek Casino in Buffalo, New York. My initial plan was to just open the hotels, but once I got home I continued in leadership there for a few short years. (In 2007, George was promoted to general manager of the Seneca Gaming Corporation, a wholly owned, tribally chartered corporation of the Seneca Nation of Indians which operated all of the Nation’s Class III gaming operations in western New York.)

During a hotel or casino opening, you’re doing everything from the ground up and I like that excitement. I enjoy putting processes into place and building teams.

We opened seven food and beverage outlets (at Seneca Niagara Resort & Casino), a spa, and everything in between all at the same time. I think people that open casinos or hotels are a special breed. Either you love the craziness and energy or you don’t. For some people, it’s overwhelming. I thrive on it. `How would you describe your leadership style?

When I think about my leadership style I like to quote E.M. Statler: “Life is service — the one who progresses is the one who gives his fellow men a little more — a little better service.” I learned that on day one at Cornell. I incorporate that into my work and home life. If I can just be a little bit better, that’s what the world needs from me. That’s my philosophy as a leader.

I ask employees, ‘What are you going to do a little bit better today?’ Whatever they do better makes us better as a company, as well as our tribe. Life is service, and I ascribe to that. I believe I was put here to serve others. I’m a hands-on, open communicator with the entire team. I’m a very laid-back, calm person. It comes in handy when you’re opening a hotel or casino or crazy busy. It helps ground everybody. `You left Seneca in 2009 and took a career gap year. Why? I came to a point in my career where I needed to take a sabbatical. I was very stressed out. I had become someone who

16 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

Kathy George

The George File Education: Bachelor’s degree in hotel administration from Cornell University in Ithaca, N.Y. Career ladder: After graduating from Cornell University, Kathy George joined Wyndham International Inc., formerly based in Dallas, Texas. (now Parsippany, N.J.-based hotel company and franchisor Wyndham Hotels & Resorts). George worked in various positions and locations at Wyndham from 1992-2005, starting as an assistant front desk manager at the Wyndham Garden Hotel in Bothell, Wash., and working her way up to general manager of several properties over the course of her career, including the Wyndham Franklin Plaza Hotel in Philadelphia, Pa. She left Wyndham in 2005 to work for Seneca Niagara Resort & Casino in Niagara Falls, N.Y. George helped open the 604-room hotel, starting as the director of operations and working her way up to vice president of resort operations, where she oversaw the hotel’s operational departments. In 2007, she was promoted to general manager of the Seneca Gaming Corp., a wholly owned, tribally chartered corporation of the Seneca Nation of Indians which operated all of the Nation’s Class III gaming operations in western New York. In her role, she oversaw Seneca Niagara Resort & Casino and the opening of Seneca Buffalo Creek Casino in Buffalo, N.Y. George oversaw the casino’s day-to-day operations and led a team of 3,000 employees. She left her role in 2009. In 2010, George joined multinational hospitality company and franchisor Hilton Worldwide Holdings Inc., where she worked as the general manager of the Embassy Suites Hotel in Secaucus, N.J. In her role, she oversaw the operations of the hotel and was responsible for overseeing the property’s revenues and performance metrics. She left Hilton in 2012 to join FireKeepers Casino and Hotel, where she started as the general manager and vice president of hotel operations, opening the first hotel tower and event center at FireKeepers. In 2017, George was promoted to CEO of FireKeepers.

Current role: CEO, FireKeepers Casino and Hotel A mentor: Giuseppe Pezzotti of Cornell University’s School of Hotel Administration, who was George’s food and beverage lecturer at the university. “To have that mentorship 33 years later is very special.”

wasn’t me. I laugh a lot and smile all the time. Most importantly, I’m talking to the employees and the guests every day. We got so busy and tied down into meetings.

In the old days, I worked 60, 70, or 80 hours a week. That’s what the industry calls for. I wasn’t smiling anymore. So, I took time off.

I picked the year 2009 when the economy was horrible. But it was the right thing for me. I was plodding along and that wasn’t OK. I traveled to Australia, Alaska and everywhere in between. I think I went to every dance recital, baseball game, and softball game of my nieces and nephews that I had missed before. I saw them all that year. The time off allowed me to recharge and rededicate myself and my efforts to serving people, which is why I got into the industry in the first place. It taught me a valuable lesson in ensuring

that I maintain a balance between work and home life so that I can be the best me to those around me. After that, I was fortunate to get a position with Hilton in Secaucus, New Jersey. `Why did you join FireKeepers?

During my second day of my job at Hilton, I got a call from the tribe at FireKeepers and they said, ‘Your resume has crossed our desk three times this week, so we decided we had to call you. We’d like you to come work for us.’ I said, ‘That’s great, but I am on day two of my job here with Hilton. I can’t leave.’ After that, I committed to staying (at Hilton) for roughly 16-18 months. I started (at FireKeepers) 18 months to the day that I told Hilton I’d leave. Once I filled that commitment, I came here and have been here for nine

` When the COVID-19 pandemic hit, what were some tough decisions you had to make in order to get the casino up and running?

When it initially hit, I remember thinking, “Are we really going to close? The casino never closes.” Then, March 16, we closed.

Some of the biggest adjustments were having to do things like calling the bank to have them come get money out of the unoccupied building in order to protect the assets of the company.

We had an 1,800 member team here.

You want to open for revenue, but my biggest concern was getting 1,800 people back to work. There’s also 1,500 tribal members that rely on us for the programs that they receive. There’s a whole community of people it impacts as well, like food purveyors. It was important that we reopened and that we did it safely. It took us a couple of weeks to prepare for that. We ran two days of test runs for invited guests only to make sure all of our protocols were in place.

We opened up to everybody on June 1.

We’ve been very cautious. Our property is currently nonsmoking, including for employees. We created an outside venue for the guests to smoke at. We implemented temperature checks and social distancing between machines.

The state had instituted a 50 percent occupancy in restaurants. We abide by that even if we don’t have to, because we think it’s a good business practice.

We also made the decision not to reopen the buffet, banquets and our food court area as well as bingo and poker. We were fortunate after we reopened that by the middle of July, we had called most everybody back. Some of the positions had to change. For instance, no one can run valet cars right now, so most of those employees switched to temperature takers or cleaning crew. We redeployed people and were fortunate to still end up with 1,700 people.

Of course, revenues are down. But we’re still able to do all the programs we do for our employees and the community, such as our food pantry that feeds thousands of people each year. We haven’t cut back on any of our charity work. It has been a challenge, but the team has risen to it. ` Do you have any advice for women hoping to work their way up the ladder in the hospitality industry?

Stay true to who you are. Back in the ’80s and ’90s, people would say if you’re a woman in power you have to be mean or come across as not so nice.

Well, that’s not true. I am a kind, caring, giving person. But I’m also very strong, fair and consistent. There’s a balance. I’m true to me. When I wasn’t true to me, I had to walk away until I could be me again. Don’t let people change you for what they feel you need to be. Be better than yourself the day before. That’s who you’re competing with, not anybody else. If we can all do that, then we’re all going to get better.

This interview has been edited and condensed for clarity.

COMMENTARY

HEALTH CARE

Why a wage boost for caregivers matters. PAGE 18 Demand for direct care workers will only intensify. PAGE 18 Professionalize direct care workforce to stabilize it. PAGE 19 Livengood: State’s home care labor model is broken. PAGE 22

DIRECT CARE WORKERS

‘$13 AN HOUR? I CAN’T LIVE ON THAT.’ Dodie Torzewski, manager of a Samaritas group home in Monroe, said her six-person staff have been working mandatory overtime for the past two months amid a shortage in caregivers for four disabled women. “It’s never been this bad before,” Torzewski said. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Low wages, long hours contribute to a critical shortage of health care’s unsung heroes BY ANNA CLARK | Doctors and nurses are lauded as front-line heroes in the battle

against COVID-19, but direct care workers who help people at home are a less visible and relatively unheralded part of the health care ecosystem.

The pandemic magnifies their long-simmering undervaluation.

Direct care workers — an umbrella term for home health and personal care aides, as well as nursing assistants — help older adults or people who have disabilities with dayto-day tasks. There are about 69,000 direct care workers in Michigan, which is 20,000 more than a decade ago, according to Paraprofessional Healthcare Institute data.

Wages are chronically low. Base pay is generally around $10-11 an hour at the current Medicaid reimbursement rate, and jobs don’t often come with predictable hours.

About a fifth of Michigan’s direct care workers live below the poverty line, according to PHI, and nearly half receive public assistance, mostly food benefits and Medicaid. Thirteen percent have no health insurance.

“We’re competing with fast food restaurants and big box stores that can pay $15, $18 an hour,” said Kelli Dobner, chief advancement officer for Samaritas, a statewide social services network.

Many are drawn to direct care because they have compassionate hearts and skills, and they want to help others in a very immediate way. But in the end, Dobner said, “people’s ability to make a living trumps all of that.”

After the onset of COVID-19, the state boosted the pay of direct care workers by $2 an hour. The latest expansion for the temporary raise will expire on Dec. 31,

unless the state legislature intervenes.

But the systemic precariousness led to a severe shortage of direct care workers well before the pandemic.

Alexis Travis, senior deputy director of the Aging & Adult Services Agency in the Michigan Department of Health and Human Services, cited PHI’s report on the state needing 34,000 more direct care workers to meet demand.

“We’ve seen this situation only get worse with the onset of the pandemic,” Travis said.

See WORKERS on Page 20

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 17

HEALTH CARE COMMENTARY

Why $2-an-hour wage boost for caregivers matters to other workf orc

BY COLLEEN ALLEN AND MARK MCWILLIAMS

F

or many Michigan families, mental illness and developmental disabilities are a fact of life.

Their daily activities include providing high levels of personal care for a loved one and, very often, they find they can’t do it all on their own.

That is where our state’s direct care workers come in.

These 50,000 individuals provide personal care, emotional support and vocational training to more than 100,000 of Michigan’s most vulnerable residents.

Their work makes it possible for family members to remain employed and contribute to the state’s economy while their family members receive the support they need.

Unfortunately, Michigan’s direct care workers are not compensated as well as they should be.

Add in a lack of health care or other benefits to many direct care workers, and it’s easy to see why many leave the profession very quickly. Today, direct Mark McWilliams is care worker turnover is 37 public policy director for percent — and it’s increasDisability Rights ing every day.

Michigan.

And there couldn’t be a worse time to be losing In fact, many of them make less than they these workers. Many Michiganders are facing a could if they were serving fast food or restock- higher level of mental stress due to the COVID-19 pandemic and other factors associing store shelves.

Our state’s direct care workers earn an aver- ated with the difficult year our state has experiage starting wage of $10.70 per hour. With retail enced. We need more supports, not less.

That is why our state’s leaders acted to supoutlets and fast-food restaurants paying starting wages between $11 and $14 per hour, on port direct care workers this past spring.

The governor and Legislature approved a $2 average, we can see there is an obvious gap.

Colleen Allen is the president and CEO of the Autism Alliance of Michigan.

hourly wage increase to help retain and boost the availability of Michigan’s direct care workers, which went a long way toward helping these essential team members make ends meet. Even better, the state’s 2020-21 budget sustains this temporary increase through Dec. 31.

While that’s a positive action — and one for which we are immensely grateful — we are concerned about what will happen as 2020 comes to a close.

We are hopeful our state’s leaders will once again act to preserve this additional direct care worker support, so Michigan’s vulnerable residents and their families can continue to receive the support they need.

Our best hope lies in the passage of another major federal aid package. These additional funds are urgently needed — and sooner, rather than later — to support an extension of the

$2 h Th incr dire tive the U abo cost W rect part add ther Mic of th W to k they

As the country ages, the market demand for direct care workers will onl

BY KATE PEW WOLTERS

Kate Pew Wolters is president of the KRW Foundation in Grand Rapids.

I

magine for a moment, your alarm goes off at 6 a.m. and it’s time to go to work.

But somehow you can’t get out of bed. You wait. You pick up your phone and see that the person that was supposed to be your arms and your legs to get you out of bed, cleaned up and dressed and ready to make a living is unable to come because she has a sick child.

Or perhaps someone in her house was exposed to someone who has COVID. Your one

connection between dependence and independence is gone. Not her fault.

The home health care agency doesn’t have enough on-call people to send you someone else. This is what disabled people who depend

on direct care workers are faced with every day.

And this is only one barrier to our independence.

As a philanthropist with a disability I figured that I was in a unique position to try and address this issue. To try and “fix” it. And after all, I had a vested interest.

I looked everywhere for a model — for-profit or not-for-profit — that had figured this out.

One that was profitable enough to sustain itself yet not so profitable that the people it served were unable to afford it.

One that understood the need for the client/ consumer to have control over who cared for them — the ability to hire and fire and train.

One that clearly had the client/consumer at the center.

One that actually paid the worker a living wage and saw this as a viable career choice.

I’ll tell you that they are few and far between.

The goal for many disabled people to live an independent life with the assistance of a personal care attendant is great if you can find a qualified person to work for you, stay with you

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COMMENTARY

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$2 hourly wage increase for direct care workers.

The consequences of losing this temporary increase are immense. Families who lose their direct care workers will have to make alternative arrangements, which may include leaving the jobs they need.

Ultimately, these sorts of decisions will bring about significant local economic impact and cost the state much-needed tax revenues.

While the issues surrounding payment of direct care workers — and the strength of that particular talent pipeline — are going to require additional long-term thought and planning, there are short-term actions possible to ensure Michigan families aren’t teetering on the brink of their own financial cliffs.

We urge our state and federal policy leaders to keep this vulnerable population in mind as they develop their plans for the future.

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and be willing to be paid the rate that Medicaid will cover.

In Kent County where I live, the average hourly salary for a direct care worker is $12.29 an hour — a scant $0.23 over what they could make at the local fast food restaurant.

When we find a great worker, keeping them when they feel the pull to a higher paying, consistent position with the possibility of benefits has become increasingly difficult.

See WOLTERS on Page 22

Professionalize direct care workforce to stabilize it

BY GARRY CARLEY

M

y identical twin brother, Terry, had a developmental disability due to a brain injury at birth.

As a child, Terry attended many schools, trying to find just the right one. His proudest moment was graduating from Henry Ford High School in Detroit.

There was much to learn from Terry. He loved unconditionally, had a great sense of humor and knew more about batting averages than Ernie Harwell.

Terry never married, held a regular job or drove a car. He lived in group homes from the age of 29 until he died at age 56.

Terry, like so many, benefited greatly from the group home setting. It provided some comforts of home with care, safety, dignity and opportunity. The characteristics of home were determined by the caregivers.

My family will forever be grateful for Oneida, a caregiver Terry loved and who treated him as family herself.

When the focus changed from institutional to home and community based care, there was undeniable progress in humanity for those receiving care.

This change also required a different and much larger workforce of caregivers, and left gaps of service for many. The Clinton Township-based Futures Foundation was formed to help where these gaps left people in need.

Inspired by its support of so many families like mine, I became a board member in its early years.

Garry G. Carley is a former partner at the Dykema law firm, a former vice chairman of Standard Federal Bank and owner of The Heathers Club of Bloomfield. He is a member of the Futures Foundation’s board of directors.

THE WAGE STRUCTURE IS NOT SUSTAINABLE TO A PRODUCTIVE WORKFORCE AND ITS BARRIERS NEED TO BE ADDRESSED AS PART OF A VIABLE SOLUTION. Since its inception, the Futures Foundation has been committed to furthering quality of life for children and adults with developmental disabilities.

We address fundamental needs not covered by any other resource — providing for basic needs, technology/communications and opportunities of skill building, education and community experiences. The work of the Futures Foundation has impacted thousands of lives.

At its core, the Futures Foundation is about helping people. As the landscape has changed, our constituency consistently shares that the greatest challenge in quality of life is finding support in the care they need.

Therefore, remaining committed to our history, we have also significantly and strategical-

N

ly engaged as a proponent of change for the direct care workforce.

Caregivers are an essential part of our nation’s workforce and they need to be valued as such. As the fastest growing major job category in the country, the market is not supported to bring up supply.

The wage structure is not sustainable to a productive workforce and its barriers need to be addressed as part of a viable solution.

In general, the labor pool at $12 an hour is limited and transient.

And while there are angel caregivers committed to this work regardless, as one of the most emotionally and personally demanding jobs, there is no direct care labor pool at a $12 an hour wage.

From a measurable perspective, we know that the value of a trusted, trained and reliable caregiver equates to independence, better health, community engagement, and the opportunity of economic stability/prosperity.

And the intrinsic value is simply not quantifiable.

The direct care workforce issue is not new, however, elevated in its devastation amid COVID-19.

How it is chosen to value caregivers, is also how it is chosen to value those for whom they are providing care. It is a workforce that needs to be professionalized and uplifted.

To do so will be a heavy lift requiring the work and collaboration of many, the support and expertise of business and community leaders and the serious attention of our government.

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Insurance industry responds to home health care growth A change championed

by Michigan’s own Dr. Mark Fendrick for over a decade has allowed telehealth visits to be offered without cost-share for high deductible health plans.

The pandemic has impacted every facet of our society. Health care is now in a race to catch up with society and technology. In the past 10 months it made great strides to catch up, but there is still space to grow. “We’re bringing care to where people are, in their homes and in their neighborhoods,” said Dr. Vivek Murthy, former Surgeon General under President Obama and President-Elect Biden’s nominee for that role.

Murthy was pondering the future of health care.

Today, home health care is a $102 billion industry. Federal and state health programs have paid for about $76 billion of these services; commercial health insurance has paid about $12 billion. Medicare’s rules, which govern most of the health care industry, have allowed for most rehabilitative care such as physical, occupational or speech therapies, medical social services, and intermittent home health services to be covered.

The industry has begun to innovate and to deliver more services to the home. The pandemic has brought telehealth to the forefront of care. The University of Michigan Institute for Healthcare Policy and Innovation’s Telehealth Incubator reported that its video visits rose from 390 in January to 20,600 in April. In 2019, DaVita Kidney Care announced its home hemodialysis programs had expanded at four times the rate of its in-center care; the center has a goal to move a quarter of its care to homes by 2025.

And a bright sign has emerged in the overlooked area of mental health. The availability of counseling from a patient’s home has increased

visits and provided care in a healthy space. The next generation of telehealth may include tele-stroke, tele-ER and tele-hospital services where the patient can be home, but be monitored remotely by medical teams.

The insurance industry in Michigan has responded in kind. During the pandemic, the industry supported new laws and executive orders encouraging the use of telehealth and allowing for insurers to cover these services.

Medicaid updated antiquated laws limiting telehealth services based on the patient’s location. Insurers have put programs in place to offer telehealth services without cost-sharing to their individual or employer-sponsored plans.

A change championed by Michigan’s own Dr. Mark Fendrick for over a decade has allowed telehealth visits to be offered without cost-share for high deductible health plans. The plans responded by implementing this for enrollees.

Medicare, on December 1, released new guidance allowing 144 more services to be available as telehealth. This change allowed emergency room visits and discharge visits, among other services, to be performed virtually.

The definition of home health care has evolved from the days of your neighborhood physician walking up to your door. Now, we connect with providers through a secure portal to have a growing number of services delivered to the patient. State and federal governments have amended laws to lower the barrier to implementation for the industry.

The health insurance industry has maximized these opportunities to deliver affordable care by increasing services and decreasing costs.

Future opportunities for home health care are poised to grow.

Learn more at MAHP.org.

State and federal law and guidance has innovated, and health plans have supported and scaled these changes in the home health landscape.

CRAIN’SCONTENTSTUDIO DETROIT

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 19

HEALTH CARE

WORKERS

From Page 17

Progressive Lifestyles Inc., a Waterford-based direct care worker agency, has 175 employees right now, and about 60 open positions for caregivers. Meanwhile, demand has grown since the pandemic led to shutdowns in day programs and vocational training initiatives.

Many workers are putting in 60- to 70- hour weeks, said executive director Jennifer Bohne.

“Hiring is a huge challenge,” Bohne said.

Bohne affirms the “amazing attitude” of staffers, but adds “if we were able to just solve that hiring problem, it would make such an incredibly positive impact.”

“You can’t get people to come even for an interview,” said Deb Davis, manager for a small Samaritas group home in Scottville, near Ludington. “I’ve had this opening since September.

I’ve had maybe three people actually show up for the interview, and one got up and said, ‘$13 an hour? I can’t live on that.’”

Lack of childcare at a time when in-person school and other youth programs are closed adds to the problem, Travis said. Direct care staff in small group homes reported that there are available beds unused because of coronavirus safety concerns, which leads to a further decline in Medicaid reimbursement funding.

At a Samaritas group home for four disabled women in Monroe, house manager Dodie Torzewski and six employees have been working mandatory overtime for the past 60 days — they normally have a staff of 12 for round-the-clock care.

“Before that I had two new people who didn’t even last 90 days,” Torzewski said. “I have people who run tons of overtime. That’s been the new normal here.” “”’m training two people right now that I’m praying they stay with us,” Torzewski added.

Direct care is inherently intimate. Early in the pandemic, many workers statewide experienced a delay in receiving personal protection equipment, or PPE. Compared to other health and safety professions, aides were equally at risk of contracting the virus, but they were not prioritized the same way for the scarce supply, making them and those they serve vulnerable.

“Either they have to reuse PPE, or they don’t have access to PPE, or they pay for PPE out of pocket,” Travis said.

Bohne was ahead of the game. Watching the coronavirus move across the globe in January and February, she reached out to vendors for high-quality masks well before the virus reached Michigan. But supplies took a month to arrive, leaving Bohne “sweating and sweating.”

As they awaited the PPE shipments in the spring, Progressive Lifestyles put together homemade kits for its direct care workers.

Wearing gloves and sitting six feet apart, they folded masks out of paper towels.

“I know it’s insufficient, but we had literally nothing else to offer,” she said.

This wasn’t a theoretical worry. There was a COVID outbreak that month: 10 cases, including a few deaths, and multiple homes in quarantine.

Access to PPE has since stabilized, in part through coordinated support by the State Emergency Operations Center, local health agencies and philanthropic foundations.

Keila Adkins, group home manager for Progressive Lifestyles Inc., watches as resident Jeremy Bennett work outside of the Bow Lane group home in Waterford.

AS THEY AWAITED THE PPE SHIPMENTS IN THE SPRING, PROGRESSIVE LIFESTYLES PUT TOGETHER HOMEMADE KITS FOR ITS DIRECT CARE WORKERS. WEARING GLOVES AND SITTING SIX FEET APART, THEY FOLDED MASKS OUT OF PAPER TOWELS.

Enduring a pandemic The challenges of 2020 have called for extraordinary acts of commitment. One Samaritas direct care worker chose to quarantine for two weeks in the home of a gentleman she worked with after they learned he’d been exposed to COVID-19 at a hospital where he’d had a procedure done, even though she had a family at home, Dobner said. (Neither ended up getting the virus.) Similarly, when dam failure near Midland led to dangerous floods and an evacuation order, another direct care worker stayed with someone who could not be lifted elsewhere.

Caregiving is about building a “culture of gentleness,” said Bohne. She too noted that a number of her agency’s health aides quaran20 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

Deirdre Mercer, chief operating officer of Progressive Lifestyles Inc., shows a makeshift paper towel face mask that the home health care agency made for its workers in March when they were awaiting delayed shipments of face masks and other personal protection equipment. The paper towel masks were never used, but underscored the desperation some health care workers were experiencing with PPE shortages during the spring COVID-19 surge, said Jennifer Bohne, executive director of Progressive Lifestyles, a Waterford-based not-for-profit organization. | DEIRDRE MERCER

tine with residents to make sure their basic needs are met. After she put out a call for help, within an hour, 25 people volunteered for duty, including those who had families at home.

“They know that if they didn’t stand up to do what the community’s asking them to do, to provide care, then nobody else will be able to do it.”

But many people are working to make direct care more sustainable for workers, and more meaningful for those they serve — including systemic changes that go beyond the pandemic.

First, there are a number of short-term adaptations for the COVID era. That includes “getting creative with telemedicine,” as Dobner put it, to do as much as possible online, including medical screenings. Philanthropic foundations have helped make it possible to get tablets to more people, including specialized devices with larger buttons or other modifications to make them functional for people with different needs.

As with other providers, Progressive Lifestyles developed tools for screening and outbreak management, and it does weekly check-ins with a nurse from the health division of Oakland County.

“We’ve gotten really good at knowing exactly what to do,” Bohne said.

Sometimes community members show support by sending staff and residents boxed lunches, which cheers everyone’s spirits. And the promise of a vaccine in 2021 is “a light at the end of the tunnel,” she said.

There are strict protocols for wearing masks, washing hands, and taking temperatures.

While Davis manages the Scottville home, she’s getting back to her roots in doing direct care work, due to job vacancies.

For tasks where bodily fluids might be involved, she said, like showering, staff gets gowned, gloved and wears masks.

“It’s tiring and it’s hot,” she said. “But we joke around … I couldn’t ask for better people [to work with] 12, 16-hour shifts. We all pulled together.”

Family visits are curtailed, along with hugging and other forms of contact, which is painful for everyone.

“I believe it’s truly the safest choice, but it’s totally in contrast to everything we do,” Bohne said.

Some relations drop off meals to homes in quarantine, and everyone leans more on video calls.

When Ann Styles’ son celebrated his 27th

“IT’S NOT JUST US, THERE’S SIGNS EVERYWHERE FOR PEOPLE HIRING. I THINK MOST ESSENTIAL JOBS ARE HURTING.” — Dodie Torzewski

Dodie Torzewski manages a Samaritas group home in Monroe that normally requires a staff of 12. They’ve been operating with seven caregivers for the past two months. “For some people, they don’t realize how hard (the work) is,” she said. | PHOTOGRAPHS BY NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

birthday recently, she shared a mask-wearing visit with him in the yard outside Ducey House, a small group home in Muskegon. “It’s hard for Cody, because Cody is used to me being in his room,” Styles said.

Not everyone has that, however. Davis from the house near Ludington said many residents only have court-appointed guardians who have less commitment to keeping in touch.

Family members — generally the siblings of residents who are 55 and older — are less comfortable with technology for video calls, and, for non-verbal residents, that doesn’t leave many options for connection.

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Changing the status quo

Outings are also limited.

Davis said that the residents at her house love going to restaurants, movies, stores, and other adventures in the community, but, she said, the virus means they are mostly limited to rides and walks where no one is around.

Kim Vanderlaan is a direct care worker and medical lead at a small group home for women in Muskegon. She said that while they can take the five residents out in a van, “we can’t get out of the van, unless we’re in a secluded area.” One particular gentleman, she said, loves watching the waves at the beach, so they take him there as often as he wants.

Scott Moore, MD, Washtenaw County

DELIVERING HEALTH CARE IN A COVID WORLD

A

doctor’s visit in 2020. If you’ve had one, you know they are more complicated than ever. Text messages sent from parking lots, front-door temperature checks, and screening questionnaires are only the beginning of what has amounted to a total transformation in how medical practices operate.

In fact, Doctor Moore argued, the entire health care system benefits when primary care physicians are able to use telehealth for service delivery. The only drawback? Health insurers don’t always cover in-person and virtual visits at the same level, despite the fact most of the same action steps are required.

Many physicians have turned to telemedicine as a way to ensure the ongoing health needs of patients are addressed safely and timely.

“From reviewing and planning for each patient consultation and the visit itself to follow-up referrals, charting and testing, the same processes are followed,” Doctor Moore said. “It’s important for payers to recognize this and ensure payment parity between in-person and virtual visits.”

According to Washtenaw County pediatrician Scott Moore, MD, online office visits are safer and more convenient for patients and physicians alike.

“Right now, the less time you spend in a doctor’s office, the better for everybody,” Doctor Moore said.

“Telehealth allows me to get a visual on a sick child, which I can’t do on the phone.

It’s an impressive tool for triage and it helps keep families connected to their own primary care physicians, which is less expensive and more effective than an ER or urgent care visit.”

Long-term, a year-old statewide work group is investigating how to build a stronger architecture of direct care services, including incentive programs for workers, standardized training, career growth opportunities, and perhaps a licensing or certificate program that could be leveraged for better pay.

The work of the direct care advisory commission includes virtual listening sessions, economic analysis of wages and retention, and comparisons with other states.

Travis also said the state is developing a platform where employers and direct care workers can match with each other, an effort to help fill the job gap, and this year, it introduced a self-determination initiative for older adults looking for caregivers, after policy shifts made it more possible to acknowledge their agency.

In October, MDHHS announced a $3.9 million program funded by the CARES Act to recruit and retain 2,000 direct care workers by the end of the year using a monetary incentive of $1,600 if recipients complete training and up to 300 hours of work.

Advocates say the change that could have the biggest possible impact is a living wage that accounts for how essential caregiving is, not only for the individuals and families served by it, but for the whole community.

Dobner, the chief advancement officer for Samaritas, said the status quo on wages will continue “until enough voices raise up to make a difference.”

“It’s sad and frustrating to see where value is placed,” she said.

Anna Clark is a Detroit-based freelance journalist.

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a real way of delivering quality care in a way that’s effective.”

In Doctor Moore’s practice, telemedicine has become an integral part of each and every patient consultation. And it’s not going to change when COVID is over.

“Our new workflow is every sick call starts with a telemedicine visit,” Doctor Moore said.

“Instead of going back and forth with a nurse, I can sit down with the patient directly—even after hours—and get all my questions answered and put a firm, immediate plan in place with the patient.

It’s great for primary care—financially and in every other way. In-person visits will always be needed in some form, but we can make things so much easier and better for everyone if we add virtual consultations to the experience.”

Ultimately, Doctor Moore believes telemedicine is here to stay.

“We had been using our online platforms for a year and a half or so before COVID hit, but adoption was slow,” Doctor Moore said. “With COVID, we had everyone aligned behind the same goal, which was keeping people safe in their homes. And we all came to recognize how well virtual visits can work.

It’s not just a ‘doc in a box’ model, but

msms.org DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 21

HEALTH CARE COMMENTARY

In dollars and cents, Michigan’s home health care labor model is broken for the most vulnerable O

n the Sunday morning after Thanksgiving, a staffing coordinator at M&M Home Care Inc. sent out an urgent email to its workforce of 145 direct care workers.

“We need immediate coverage for our client in Chad asap-7p. $$$50$$$ LIVENGOOD Livonia, Bonus for last minute quick pick up,” she wrote.

Four days later, she was searching for two caregivers to fill shifts for five days the following week, taking care of a new client in West Bloomfield. The pay was not advertised.

That same day, another staffing coordinator at the Livonia-based home care company was looking for someone to fill a 12-hour shift for $16 an hour in Clarkston.

Every few days, I get these emails from M&M Home Care’s managers because I have a parttime job I wish I never, ever had — taking care of my disabled brother, Brian, when my parents can’t or they’re short a caregiver, which is a very frequent occurrence.

Some of these emails are desperate and get sent out at all hours of the day and night as the company’s managers scramble to fill shifts because a caregiver is sick, their children are sick, their car won’t start, they found a better-paying job with more predictable hours — or they just quit on a dime.

Being on this email list has given me an eye-opening look into the difficult nature of finding labor to care for people whose ability to function ranges from an Alzheimer’s patient who needs assistance around the house to someone like my brother who can’t walk, talk, bathe or feed themselves.

Since 2004, I’ve watched a revolving door of direct care workers from seven different agencies come in and out of my family home in Chelsea. I estimate there’s been somewhere in the ballpark of 150 people care for Brian over the past 16 years.

I asked my mom to write down the names she could remember. She came up with a list of 17 women and five men. Just in the past year, there’s been 10.

Nancy, one of Brian’s current caregivers, has been with us for the past eight years. She’s Saint Nancy in my book.

A woman named Brenda took care of him for three years. A close friend named Angie was his caregiver for a period of 18 months well over a decade ago. The rest have lasted a few months, weeks, days and even hours.

Some have quit in the middle of the shift after realizing how hard it is to lift a 6-foot-1, 220-pound man in and out of bed and chairs — for $12 an hour.

The turnover rate for the direct care worker industry was 64 percent in 2019, according to Home Care Pulse, an Idaho-based market research firm.

That’s largely due to the low wages for a level of work that, in my brother’s case, is physically and emotionally harder than washing cars or slapping together a Turkey Tom at Jimmy John’s

WOLTERS

From Page 19

The issue of direct care workers and their availability, and especially their compensation has been elevated as our country continues to age.

The direct care crisis that disabled people experience has begun to be included in much of that discussion now, as advocates have pushed.

More recently with the candidates in the 22 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

Crain’s Senior Editor Chad Livengood feeds his 36-year-old brother, Brian, who was permanently disabled in an August 2004 electrocution accident. Brian requires 24-hour care for toileting, bathing, eating and being transferred from chairs and beds. He lives in Chelsea with his parents and gets daily care from direct care workers through M&M Home Care Inc. in Livonia. | CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

— jobs that typically pay more in this job market.

My mom and I fill in when needed and it’s certainly a labor of love for us.

Since Brian sustained a brain injury in a freak electrocution accident, he’s on a Medicaid insurance program for the aging and disabled that’s limited to 64.25 hours a week of care.

ments for providers.

The math is pretty simple: The patients with the lowest reimbursement rate are the hardest to consistently staff.

Area Agency on Aging 1-B, the Southfield-based nonprofit that administers the Medicaid in-home care for my brother, pays M&M Home Care about

SINCE 2004, I’VE WATCHED A REVOLVING DOOR OF DIRECT CARE WORKERS FROM SEVEN DIFFERENT AGENCIES COME IN AND OUT OF MY FAMILY HOME IN CHELSEA. I ESTIMATE THERE’S BEEN SOMEWHERE IN THE BALLPARK OF 150 PEOPLE CARE FOR BRIAN OVER THE PAST 16 YEARS. Those hours get spread out across all seven days each week to give my parents the time they need to run their small business and enjoy life a bit.

In normal years, I spend a few weekends taking care of Brian while my parents go on a much-deserved vacation and Nancy stays with him during the week. My parents pay her out of pocket for the round-the-clock coverage.

They have the means to do that. Not everyone does.

The wages for this line of work through Medicaid are set by the government. And the crisis this industry faces in retaining passionate and caring workers is one that’s primarily driven by the state and federal government’s reimburse-

$17 per patient care hour (which comes out to $1,092 a week and $56,797 a year).

After an hourly wage, the staffing company has overhead costs, payroll taxes and liability insurance to squeeze out of that $17 per hour.

“As soon as I pay more than $12 an hour, I lose money,” said Michael Malecki, president and CEO of M&M Home Care.

Malecki, a former Detroit paramedic who has been in the health care staffing business since 1995, said if Brian were a private pay client, he would charge $27.50 per hour.

If Brian had been in an auto accident, Malecki said the hourly rate would be $35 an hour — his highest rate for a patient with a high level of acu-

presidential race, personal care attendant issues have been included in disability related platforms.

Policy issues revolve around need and money. We’ve got the first and, of course, need the second.

Michigan was one of 24 states to sign onto the Medicaid waiver program in 2013 under Gov. Rick Snyder. This put additional money into the hands of disabled people already covered by Medicaid, and helped both keep disabled people in their homes, or help them get

POLICY ISSUES REVOLVE AROUND NEED AND MONEY. WE’VE GOT THE FIRST AND, OF COURSE, NEED THE SECOND. out of inappropriate placement in nursing homes.

With the dissolution of the auto no-fault law, the people who are permanently disabled from auto accidents and needing home care are of-

ity, such as a quadriplegic or someone on a ventilator at home. Those nursing assistants earn closer to $17 an hour, plus health insurance, vacation and retirement benefits, Malecki said.

“The reimbursements are night and day,” he said.

Malecki’s company “inherited” the program my brother is on through the acquisition of a Milford-based company, Hearts and Hands Home Care, that often struggled to fill shifts to cover Brian’s daily care on Fridays and Saturdays.

“They were essentially forced out of business because they relied way too heavily on (Medicaid patients) and could not sustain it,” Malecki said.

M&M Home Care has a mixture of home care patients on Medicaid, private pay and personal injury protection (PIP) coverage through their auto insurance spread across more than 150,000 patient care hours they expect to log this year, Malecki said.

Like any Medicaid provider, Malecki has been trying to convince Area Agency on Aging 1-B that providers badly need an increase in their reimbursements in order to keep wages competitive with other low-skilled jobs.

He said if the hourly reimbursement rate were increased to $21 an hour, he could boost direct care worker wages to $13.50 and still net a 5 percent profit for his business.

That’s still not a living wage. In fact, it’s less than half of the full-time wages of $30.64 an hour needed for a Michigan family of four’s survival budget, according to the Michigan Association of United Ways’ annual ALICE (asset-limited, income-constrained, employed) report.

And it would still lag behind big health care employers, such as Henry Ford Health System, Mercy Health and the Saint Joseph Mercy Health System, which increased their minimum wages to $15-an-hour in October.

“Valet parking people are getting $15 an hour plus tips to park cars” at hospitals, Malecki said.

“It is a broken system.”

The coronavirus pandemic has only added to the strain on this industry as direct care workers have quit their jobs to teach children learning from home or guard against infecting a loved one.

At the same time, families like mine are downright scared of sending our loved ones to congregate care facilities where the virus has ravaged the residents and their daily caregivers.

The $2-an-hour COVID hazard pay for some home health care workers that Congress appropriated through the CARES Act expires at the end of this month.

It may have served as a temporary Band-Aid to a labor crisis that will only grow worse as our state gets older and more people desire to live out their days at home.

Brian is 36 years old. His ability to live a full and meaningful life was cut painfully short at age 20.

We may have decades of managing his daily care ahead — an exhausting challenge that is unfathomable given all of the labor problems my parents have navigated for 16 long years.

Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood ten left without the ability to hire and pay for quality workers to say nothing of the basic costs of disability — and are now left with the limits that Medicaid imposes.

The costs to the system in health care and institutionalization are likely to surpass the potential costs of quality direct care workers to keep people in their homes, to say nothing of the potential for disabled people to become a taxpaying part of the workforce.

Issues of dignity, living wage and independence have to be a part of the conversation.

BANKS

From Page 3

A recent market report from Grosse Pointe investment bank Donnelly Penman & Partners shows that Michigan has had a total of nine banking M&A transactions over the last two years. The market report finds that the Midwest has been dominating banking deal flow, with 43 percent of all transactions.

Despite the subdued M&A activity this year, not all has been quiet, and Michigan banks are looking at deals.

In late-October United Federal Credit Union announced that it would buy Edgewater Bank — both institutions are headquartered in St. Joseph in southwest Michigan — in an all-cash deal that would create a bank with 41 branches and assets of about $3.5 billion.

ChoiceOne Bank has also had a busy December 14, 2020 year.

The Sparta-based bank in northern Kent County completed two deals this year, each of which began in 2019, said CEO Kelly Potes.

The deals had ChoiceOne acPotes quiring Lakestone Bank and Trust based out of Lapeer, as well as Community Shores Bank Corp. in Muskegon.

The deals fit in with the ongoing trends in 14, the community banking December December 14, 2020 2020 needing to scale world of institutions up technological capabilities and regulatory compliance, said Potes, adding that the acquisitions give ChoiceOne a statewide presence and create an institution in the “sweet spot” of having about $1 billion in assets.

Like Shafer with TCF, Potes said ChoiceOne is hardly ruling out future deals. “As something comes along that makes sense for us ... we could continue to talk to our other bank partners out there and if there was an Page 24 opportunity we would take a look at

“I THINK YOU’LL SEE SOME OF THOSE FOLKS SIDLE UP WITH EACH OTHER AND SAY, ‘WE’RE STRONGER AS ONE THAN WE ARE APART.’”

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HEALTHCARE

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NONPROFITS

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Sigred Solutions Cheryl Czach has joined forces with Sigred Solutions as Senior Client Advisor.

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Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

CRAIN’S DETROIT BUSINESS December 14, 2020 Crain’s People on the Move showcases industry achievers and their companies to the Detroit business community.

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— John Donnelly, managing director, Donnelly Penman

that,” said Potes. “We have the bandwidth and we know how to do it now.

We’ve done a couple of them here.”

Such sentiments come as no surprise to John Donnelly, managing director of Donnelly Penman, where he focuses on the community banking sector.

We’re currently in “a multitiered market,” said Donnelly where banks like TCF are gaining national scale, those in the midlevel range with assets of between $1 billion and $10 billion need to scale up, and those smaller will struggle to compete.

While skeptical that deal flow will come “roaring back” post-pandemic, he believes conditions still lend themselves to bank consolidation.

“For the folks under $1 billion (in assets) that’s kind of like too big to be small and too small to be big,” said Donnelly. “And so I think you’ll see some of those folks sidle up with each other and say, ‘We’re stronger as one than we are apart.’”

NEW HIRE? PROMOTION? Page 23 Page 23 BOARD APPOINTMENT?

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DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 23

DELTA

From Page 3

lanus Casey,” said Tim Hinkle, public relations director for the Solanus Casey Center and its parent organization, the Capuchin Franciscan Province of St. Joseph.

“That’s what we’re envisioning with the center, and that’s kind of where Art Van (Elslander) was coming from, thinking about hospitality where you can get a sandwich, a cup of coffee ... meditate and pray in a beautiful space outside.”

The expansion is focused on making Solanus Casey Center a place of prayer, pilgrimage and reflection, providing spiritual nourishment for all seeking it, regardless of their religion or station in life, the Rev. David Preuss, director of the Solanus Casey Center, told Crain’s in 2017.

The Delta Iron property was key to making the outdoor space a reality.

With help from the A.A. VanElslander Foundation, the center bought the Delta Iron Works property in 2018 from Manos for an undisclosed amount and has been leasing it back to the company since then.

Manos wouldn’t have moved his company if he hadn’t been asked because he loves the neighborhood and his Capuchin neighbors. “(But) I’m definitely OK with moving,” he said.

Delta will get a new building just a block away, and the Capuchins will be able to proceed with their project, Manos said.

“To me, that’s a perfect deal. I see it as a blessing to everyone involved.”

The foundation’s namesake, Art Van Furniture founder Art Van Elslander, made a $20 million gift in late 2017, less than two months before his death, to fund the first expansion and renovation of the Solanus Casey Center since its 2002 addition to the campus of the 1883 St. Bonaventure Monastery on Detroit’s east side.

Casey, an American-born Capuchin friar, was the greeter at another door, this one to the monastery, from 1926-1946.

He would greet those who came, pray with them and provide sandwiches to those who were hungry.

Soon, hundreds of people started coming to the monastery when word got out that his prayers of intercession were helping to heal people.

Casey died in Detroit in 1957 and is entombed at the Solanus Casey Center where his few possessions, including his robe and a notebook with notations on his prayers for intercession on visitors’ behalf, are on display.

In May 2017, 35 years after the effort to declare Casey a saint first began, the Roman Catholic Church’s leader, Pope Francis, announced that Casey had met the requirements for beatification when a school teacher from Panama with a genetic skin disease was miraculously cured after praying at his tomb in 2012.

Casey was beatified at a Mass held at Detroit’s Ford Field in November 2017, putting him on a path to sainthood.

“The need was there to look at the (Solanus Casey Center) with fresh eyes and thinking toward the future where some day he could be Saint So-

While Delta packs up, parts of the Solanus Casey Center expansion and renovation have begun.

Last month, work began to disman-

BONNER

around that area, which I think would be really interesting.

From Page 1

So, I won’t say there’s any specific place we’re looking. The key is, in some respects, to recreate the kind of vision that Dan and the team has already executed in downtown, where there’s focus in an area not only paying attention to the specific facilities, but also really paying attention to the urban space and thinking through that in a manner that not only creates success for us, but also lays the template perhaps for others to co-invest alongside us in areas where they can buy and grow, so we can grow together. ` What’s your vision for your tenure at Bedrock?

I would love to be able to have connected the pathway of development beyond the downtown and to some key adjacent neighborhoods. I think that is critical to the growth of downtown because folks coming in and looking to relocate or locate their offices or businesses in an area, one of the things real estate professionals do is drive around in concentric circles to see what it would be like to live, work and play and educate their kids in the area as a measure of how easy it might be to attract talent as they grow their business.

And we’ve done a great job of that to date. And I think to continue that momentum, we’re going to have to expand slightly outside of the ring. And so that means we’re going to have to create, plant some seeds, if you will, of development, perhaps link to downtown but perhaps farther from the core.

One of the exciting developments that we’re currently working on is the Detroit Center for Innovation in the old jail site.

That is a fascinating development. And once realized, I think it will create a whole anchor for development in and

Casey Center expansion underway

` What’s the status of the fund-raising on that?

I’d rather not get into that right now because that’s a much more formal process. The good news is we have a great partner in the city, and we’d like to sort of move that piece along a little bit more. But I will tell you that, as we say, the deck’s coming along nicely. ` Prior to your arrival, it’s not like there has been any shortage of challenges with regards to construction of Hudson’s or construction of the Monroe project or turnover in executives. What do you see as some of the more pressing challenges for Bedrock? And how do you envision addressing them?

Let’s start with the latter. Turnover is always difficult in any organization. But if turnover results in the right mix and product, that’s the way it is, right? I think the team that I have here is extremely talented and they’ve been extremely supportive. We’ve been getting to understand each other really clearly and we are all on the same page on where we need to be in the short term and long term.

With respect to the Monroe parcels, I’m struck by the opportunity because I have fresh eyes on that site. I certainly believe that there are opportunities for additional residential and for office at some point, but I think there’s a nearterm opportunity to really draw from some of the energy that is around the Campus Martius area. It’s really, really intriguing. And so I’m wondering if there might not be a concept that binds all that together in a phased-in style. So I’m taking a look at that.

With respect to Hudson’s, construction’s going forward right now. It’s sort of slightly below pavement level right now

24 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

tle walls in the center’s former votive chapel area and the nearby rosary garden. Construction of a 9,100-squarefoot, two-story building to house the center’s relocated offices, a new gift shop and a new cafe with outdoor seating is set to begin within the next couple of weeks and to wrap up by the end of 2021, said Jaime Rae Turnbull, who is managing the Solanus Casey Center expansion project on behalf of the VanElslander Foundation.

The previous gift shop in the center will be converted to offices, and several new confessionals, improvement to the reception area and construction of a connector from the existing building to the new gift shop and café are also planned.

Hamilton Anderson is serving as architect and the Albert M. Higley Co. as general contractor on the center’s expansion project.

The internal building projects are beginning as the center wraps up construction of a 65-spot parking lot at Kercheval and Mt. Elliot, with brickwork, lighting and fencing done this season. Final landscaping, including storm-water bioswales, will go in this coming spring, Turnbull said.

With Delta vacating its old building, the Solanus Casey Center plans to begin clearing the site during the first quarter of next year, Turnbull said.

Final designs are still being completed, but the open, outdoor area will include reflection spaces, a pavilion with an altar and flexible seating for 1,500 people for Masses, other public events and picnics, and seating to grab a cup of coffee or a sandwich, she said.

The entire expansion project is on track to be completed by the end of 2022, she said, five years after it was first announced.

“I’m very excited about (the Solanus Casey Center’s) project and their growth. They are such a wonderful group,” Manos said.

With Delta’s move now imminent, Manos is finalizing a lease for nearby temporary space for its steel fabrication operations and staff of five. He declined to say where until everything is final.

The leased space will serve as a temporary site while the company’s new home is built. Delta is in the process of obtaining final approvals from the city and completing the design for the new 10,000-square-foot building a block down Meldrum, between St. Paul and Lafayette, on land the center acquired from the city. The new location will be just over half the site of its current building, Manos said, noting a smaller footprint will better meet the company’s evolving production needs.

Manos said the hope is to break ground on the new building before year’s end and to complete it by fall.

The exact details are still being worked out with JMP Design and Build Inc., which is serving as architect and general contractor on the new building, Manos said. But the new site will include office and industrial space, a brick front and an old iron gate circa 1900 purchased from a New York company to bring it character, he said, along with the safe, the company’s front door and his father’s office door.

“That to me is continuing the business through that (office) door,” Manos said.

“I’d like to keep walking through it.”

and within the next six months, it will be well above pavement level. We have some really interesting conversations going on with respect to the tower ... and candidly, what ultimately will happen with the Book Tower. I should point out that we continue to be hyperfocused on the need for food and retail and entertainment, to continue to round out the place-making because there’s no question that we’ll continue to be focused on attracting the right blend of local tenants and national tenants that are best-in-class to co-locate beside each other.

It’s the old mall philosophy, right? You put the anchors in place, then put the line stores in place and the anchors draw the crowds and the line stores really benefit off that and maybe get to grow their brand and business. And we’ve been somewhat successful at doing that in Parker’s Alley, which is full of some of the local businesses, and they’re doing quite well. We are paying great attention to them during this period. But the good news is, we still have quite a bit of interest from folks who have some really interesting food concepts and retail concepts, and their interest is in Detroit, in downtown Detroit. They see what we see, they feel what we feel.

think there’s an opportunity to formalize and capture some more of that energy, sort of pedestrians, food, entertainment energy, right there. And in addition, still consider opportunities for retail, multifamily and office, which may mean a reconfiguration. That’s really all I’m saying, and maybe a phased-in approach, as opposed to just building everything all at once. As the new guy, I have the luxury of being able to say, “Why don’t we look at this?” and check on it.

` I want to backtrack on what you said relative to the Monroe Blocks. It sounded like what you were saying is that you’re rethinking sort of the ratio or combination of multifamily versus office. Am I getting that right?

It’s a little broader than that. I come from a mindset that, anytime you have an opportunity to enhance the public realm, or create public access within a private development in some fashion, you have actually added value to the private development. As I walk back and forth along Woodward and I see the energy around the Campus Martius area, I do

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

` I’m curious about leadership style and how you view your role as a CEO. I really consider the best success I’ve had is when I am able to set a direction, and I’m able to then provide what I call literally the blocking and tackling so that the folks who are working with me and for me are able to do the work of execution.

That requires two things. One is the ability to to understand what makes the most sense in a particular situation, and then to create the environment — be it conversations with the city, the state, the feds, different private entities. This creates the opportunities, making sure those opportunities are real and creating the environment for those opportunities to exist, then to work with the senior folks to define a path forward. I call them “coaches” because they then have to coach the folks who are actually doing the work. Let’s face it: Without the folks who are every day sort of pushing the ball forward, nothing really happens because at the scale of development we have, we have to set a direction on a variety of things.

We have to understand where the roadblocks might be. It’s my job and my senior folks’ job to clear the way for the folks to then do what is essential to execute on the plan.

I started out as a very basic project manager building affordable housing, and it was a very small shop. You sort of did everything from random numbers to

Chris Manos outside Delta Iron Works. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Construction is coming along at the Hudson’s site, Bonner said. | KIRK PINHO/ CRAIN’S DETROIT BUSINESS

going on site and managing the project for construction. And along the way, I’ve managed a lot of people and a lot of situations. So my primary job, as I see it, is set direction, manage people and manage situations. ` I forgot that you started off in affordable housing. I wonder what

sort Bed well abo

I am fund envi the b envi leve had land

“I’M VERY EXCITED ABOUT (THE SOLANUS CASEY CENTER’S) PROJECT AND THEIR GROWTH. THEY ARE SUCH A WONDERFUL GROUP.” — Chris Manos

t see d

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From Page 1

“I think we’ll get good compliance without creating any employee concern or poor feelings,” Lawrence said.

“We have a good relationship with our employees. We’ve made sure they know how (COVID-19) affects our workplace. Not only their health and safety .. it’s affecting our workplace and the success of our company and our employment. Safety for them and their family and we are going to get good participation.”

Manufacturers around the country have faced production shutdowns as workers fall ill or are left in quarantine from exposure to the virus. Last month, General Motors canceled overtime production at its Texas SUV plant and its Kentucky Corvette plant due to parts shortages caused by the pandemic.

Alpha USA hasn’t faced any production issues from its own staff falling ill, but has felt the slowdowns from other suppliers, Lawrence said.

Mandates?

orks.

ect

VACCINE

respects. And then I got the call and long story short, after the conversations with Dan and Jen (Gilbert), it was clear to me that there was a real opportunity for me here to work with them and the rest of the companies to build on what they have done.

Detroit’s essentially the perfect place to do this. I mean, we’re blessed with a great relationship with the city, which seems totally aligned with the directions we’re trying to go. The opportunities are here and I think I can be useful. If you think you can be useful when you have a talent, I think you should try to utilize that talent as best you can.

sort of lens that gives you on what Bedrock is doing. I’m sure you’re well aware, there’s a lot of discussion about gentrification in Detroit.

I am extremely interested, and fundamentally believe, that the best environments, period, and certainly the best urban environments are those environments that folks of all income levels not only can survive, but thrive. I had been part of the urban development landscape for 35, 40 years, if you add

some of my public sector life.

And yet here we are going through yet another disruption, right? And then I began to question what we had and — because I have been fortunate enough to have fairly prominent positions — what I had done. So it was in that mode of sort of introspection, that I received the call.

And I thought I was going to be perhaps writing, researching papers on the topic of inclusive urban development in some

` You said you were sort of mulling over your career, semi or mostly retired, and maybe what you could have done differently. Am I reading that right, and what specifically are you referring to?

I, like everybody else, focused on community benefit programs that maybe provided opportunities for folks to get into the workplace, to get access to affordable housing, the normal sort of community package.

There are a great deal of public policies oriented towards those items. And I just think that, in addition to those things — not instead of, in addition to — we should also be thinking about wealth creation for folks, and one of the more accretive ways to build wealth in America is through homeownership in some fashion. I could go on and on about this, and I am not quite sure how yet, but I do think that in the realm of urban development, it is important to be thinking not only about, as I call it, the traditional community benefit packages, which are not insubstantial ... but in addition, I also think that we in the urban development practice need to find ways to find pathways to wealth creation.

Employers will likely be legally allowed to mandate the vaccine to employees when the U.S. Food and Drug Administration provides full approval of the vaccine later this year. But following through on a mandate is murky, culturally and politically, in a divided nation during a pandemic that’s left fissures in how employees view the virus.

Michigan hospital executives are not expected to mandate the vaccine for employees when inoculations for front-line health care workers are distributed this week.

The University of Michigan Health System, Henry Ford Health System, Beaumont Health, Trinity Health Michigan and Ascension Health said they have no plans to mandate.

Officials from Beaumont and UM told Crain’s they haven’t decided yet what to do if health care workers who should receive the vaccine refuse to take it. They said it is possible those health care workers could be transferred to non-COVID-19 units or other duties, although that may prove difficult with already growing staff shortages.

And while local governments have legally mandated vaccines in the past — New York City officials mandated the measles vaccine in 2019 to anyone over 6 months old who lived, worked or attended school within four Brooklyn ZIP Codes — it’s unlikely Michigan health officials will pull that lever.

“We’re not looking at implementing that in the state of Michigan,” Dr. Joneigh Khaldun, chief medical executive and chief deputy director of the Michigan Department of Health and Human Services, told Crain’s. “I will say, though, I do think this vaccine is the path out of this pandemic.

And I think that every employer has a role to play when it comes to at least encouraging their workers to get the vaccine.”

Under U.S. Equal Employment Opportunity Commission guidelines, COVID-19 qualified for the American with Disabilities Act standards of a “direct threat” that permits more extensive medical inquiries and controls in the workplace than under normal conditions. Because of this, it’s expected the EEOC will back employers who choose to make the vaccine mandatory when it becomes widely available. Courts have previously upheld employer rights to mandate vaccines, as many hospitals did

during the 2010 H1N1 flu outbreak.

The EEOC guidelines, set in March, allowed employers to put in place medical testing and other measures the ADA typically does not permit, such as taking employee temperatures and certain screening questions. But the guidance also prohibited mandates for vaccines, which weren’t developed then. That prohibition is likely to change soon, said Elisa Lintemuth, partner and compliance attorney for Detroit-based Dykema Gossett PLLC. However, just because an employer can mandate a vaccine, actually doing so may prove difficult.

COVID-19 has become politicized since the outbreak began in March.

“I think mandates are going to vary dramatically from workplace to workplace,” said Elisa Lintemuth, partner for Detroit-based corporate law firm Dykema Gossett PLLC. “Some of it might be based on political and ideological beliefs of upper management.”

But employers will have to contend with workers seeking exemptions for the vaccine. Under the Americans with Disabilities Act, workers are allowed to opt themselves out from receiving the vaccine for health or religious reasons, but it’s a narrow spectrum.

Under EEOC rules under the pandemic, employers have the right to prod an employee about the specific religious belief or medical condition that prevents them from getting a vaccine, such as pregnancy or an autoimmune disease, said Sara Jodka, partner at Detroit-based firm Dickinson Wright PLLC. Employers can fire an employee who refuses the mandate if they do not have sufficient evidence of an exempt status.

“The EEOC is going to stand by employers,” said Jodka. “An anti-vaxxer, for instance, is going to have to show an underlying medical condition and being an anti-vaxxer is not one.”

Closing the distancing Felecia Pryor, chief human resources officer at Auburn Hills-based BorgWarner Inc., said the auto supplier is discussing its options around how to handle employees who wish not to take the vaccine.

“A whole lot of our people aren’t going to take that vaccine and what are we going to require of those employees?” Pryor said. “Are we going to require them (to get the vaccine), if they want to return to the office? If they’re not willing to do that, can we give them a choice until they get more comfortable? That’s something we’re going to have to grapple with.”

While BorgWarner can continue to have its office workers work from home, production workers who have been essential during the pandemic have fewer options. Social distancing and mask wearing requirements will likely remain in place for any employee who chooses not to comply with getting a vaccine.

Lawrence said it’s likely Alpha USA employees will maintain mask wearing and social distancing as long as it takes for herd immunity to be reached in the community.

“Mandating would be a last course of action for us and it’s one we haven’t seriously considered, but we’re going to have to keep our protocols in place long after we’ve started getting vaccines,” Lawrence said.

Senior Reporter Jay Greene and Senior Editor Chad Livengood contributed.

Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

DECEMBER 14, 2020 | CRAIN’S DETROIT BUSINESS | 25

THE CONVERSATION

Environmentalists and industrialists can coexist, says Nick Schroeck Detroit Mercy School of Law: Business and environmental interests don’t have to be intrinsically at odds with each other. That’s the stance taken by Nick Schroeck, associate dean of experiential education and professor at University of Detroit Mercy School of Law. Growing up in metro Detroit, Schroeck developed an appreciation for natural resources from his parents, and as an adult, he became intrigued by the complicated relationship between the Great Lakes state and its most precious natural asset. Schroeck served as a special prosecutor in the Flint Water crisis and is keenly observing litigation over Enbridge’s Line 5 pipeline. | BY KURT NAGL ` What drew you to environmental law?

My father’s family, they had this dairy farm in Pennsylvania and so we spent summers as a kid and young adult working on that farm. And he got really interested in the natural world … My mother was really into gardening and being outside and knowing different types of plants and stuff, too. So, as a kid, we were kind of always around that.

I went to undergrad in suburban Chicago, a small college called Elmhurst College. There, I studied political science and urban studies … I took a lot of urban planning classes and was really interested in parks and green space and that kind of thing. After a couple jobs in between, I moved back to Michigan to go to law school at Wayne State.

It was really through taking the courses and learning a little bit more about how we regulate pollution, how businesses and investors and environmentalists and all these people play a role in the system to get us to where we are, which is basically permitting the licensing of pollution. That’s something that I found kind of fascinating. ` What role did you play in Flint water litigation?

I was a special assistant prosecutor for Genesee County. They had a team of us assembled to look into what happened and that investigation was eventually folded into the state Attorney General’s investigation. I was basically an environmental expert to help them navigate the Safe Drinking Water Act and how all of these laws are supposed to function and what missteps were made. My (environmental law clinic) at Wayne State and myself were involved in that work.

Learning the way that people sometimes are reduced to numbers, or people and their health are thought about in economic terms rather than their own kind of innate value as people — and I’m not saying that this was part and parcel what happened with the water crisis, but there’s definitely some of that — that was very shocking and an upsetting realization. In my mind, the number one goal of our government should be to promote the

Nick Schroeck Associate dean of experiential education Detroit Mercy School of Law

health, safety and welfare of our people.

And, of course, we can quibble about where we make investments and what our tax rates are and all that kind of stuff, but really, the role of government should be to protect, and I think in the Flint water crisis we lost that overarching mission of government. ` In your mind, is the crisis over?

Well, when it comes down to it, there’s no safe level of lead. And we don’t want lead to get into our bodies in any way.

And so we have this action level now that’s lower than it was before the water crisis, meaning that when you have lead sampling in the water beyond 12 parts per billion now, these alarm bells go off and you need additional testing to warn people. That’s better than having the trigger be 15 parts per billion. Definitely

a good thing. But there’s really no safe level of lead. So, you know, working towards, as quickly as we possibly can, replacing those lead service lines… and the challenge then, of course, is money.

The other thing is that I think accountability is still lacking. We haven’t seen people charged or prosecuted all the way through a judgment, and that’s very frustrating for the people of Flint. ` What do you make of the Line 5 lawsuits?

It’ll be really interesting to see what happens with these two key cases right now. There’s one in state court in Ingham County, and that’s the case that was filed

by Attorney General (Dana) Nessel on the same day that the state announced that they were terminating Enbridge’s easement for the Line 5 pipeline. And

then we had a lawsuit in federal court in the Western District of Michigan. Why I think this will be a fascinating series of cases to watch is that they’re basically arguing over different things. The state court litigation is really focused on this easement, whether it should have been granted in the first place by the state and whether Enbridge has failed to live up to the terms of the agreement. And that’s more like a contract dispute, or a property dispute, whereas Enbridge is trying to argue in federal court that actually the state doesn’t have anything to do with pipeline regulation. It’s a federal issue. …So, how do you sort all of that out? Governor (Gretchen) Whitmer ran on opposition to the pipeline.

Attorney General Nessel also ran for election wanting to shut down Line 5, and they’re trying to do what they can to shut it down.

Their argument on the easement is using something called the Public Trust Doctrine, which is this legal doctrine holding that the Great Lakes are in trust for you and I and for future generations and that our Legislature has to protect the public’s trust in the Great Lakes.

How that squares against regulation of pipelines … will be really interesting to watch in the courts.

Do you think it’s possible to be pro-economic development and pro-environment?

For a long time in Southeast Michigan, we’ve had this idea that it’s environmentalists versus business, or it’s industry versus a community group.

It often gets set up as kind of an us vs. them type of battle. And I really think there’s an opportunity for us here in Detroit ... to think about opportunities for us to grow our economy in a green way, where we’re creating jobs and we’re adding to the tax base and all those good things, but in a really sustainable way. Detroit and Michigan could lead the w orld in showing how you take a postindustrial city and really think through the ways to make it sustainable and growing in different ways, not just good for the bottom line of companies but also good for the environment and health.

READ ALL THE CONVERSATIONS AT CRAINSDETROIT.COM/THECONVERSATION

RUMBLINGS

WJR news director, radio veteran Dick Haefner to retire DICK HAEFNER, DETROIT RADIO veteran and WJR AM 760 news director, announced he’s leaving the airwaves and retiring.

Haefner is ending a 51-year career as a reporter, newscaster and director, according to a WJR news release. He’s been in his job at WJR for more than 30 years and the last day to hear him on air was Friday.

The award-winning journalist’s work over the years included

walking listeners through his own robotic surgery for prostate cancer in “Robots in the O-R,” which won the National Association of Medical Haefner Communicators award, as well as a look into gas station fraud that resulted in

26 | CRAIN’S DETROIT BUSINESS | DECEMBER 14, 2020

new inspection rules. He broke historic stories, like the Nancy Kerrigan-Tonya Harding scandal in which Kerrigan was injured just before the Olympics trials, according to WJR. “Anything I may have accomplished is because of other people, my wife Judy and my family who allowed me to pursue adventures in broadcast news, and especially my co-workers,” Haefner said in the release. “My most important

job was to put them in position to do their best work. What they accomplished every day is my greatest reward. I have had the best job in Detroit radio news for almost 32 years. I’m the luckiest person I know.”

Steve Finateri, vice president and market manager for WJR’s owner, Atlanta-based Cumulus Media Inc., called Haefner “one of the most talented in our industry,” hailing him as a true professional.

crainsdetroit.com

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