Crain's Detroit Business, Sept. 3, 2018 issue by Crain's Detroit Business

Aronson: ‘I would do anything to keep it in Ferndale’ Page 4

SEPTEMBER 3 - 9, 2018 | crainsdetroit.com

Pay-to-play lawsuit adds to Pontiac General woes Page 3 GOVERNMENT

SPECIAL REPORT

Flint water legal bills could top $34.5 million

40 under 40

By Chad Livengood clivengood@crain.com

Private attorneys representing state health director Nick Lyon have billed taxpayers more than $1.6 million to defend a high-ranking member of Gov. Rick Snyder’s cabinet facing involuntary manslaughter charges stemming from Flint’s water crisis — and his trial date hasn’t even been set yet. That number is only a small part of amount the state has spent on Flint water crisis-related legal bills. Through mid-August, the state had spent $26.5 million, while three state departments have current capacity in contracts Need to make that total to know top $34.5 million,  State has spent according to pub- $26.5 million on lic records com- private law firms in Flint water crisis piled by Crain’s. Three days after civil and criminal a Genesee County cases judge ordered  $1.6 million Lyon to stand trial spent on state last month for the health chief Nick suspected wa- Lyon's criminal ter-related deaths defense of two elderly Flint-area men,  $3.55 million the state’s Admin- budgeted for istrative Board in- Lyon's defense in creased the con- manslaughter case tract for Lyon’s primary defense attorneys at the Grand Rapids firm Willey & Chamberlain by $1 million to $2.75 million. The state Department of Health and Human Services, which Lyon remains in charge of while facing prosecution, has additional contracts of $400,000 each with two other law firms working to keep him out of prison — Bursch Law PLLC in Caledonia and Chartier & Nyamfukudza PLC in Lansing. The $3.55 million budgeted for Lyon’s criminal defense in a high-stakes and politically tinged criminal case brought by Attorney General Bill Schuette is seen by longtime Lansing observers as an unprecedented expense of taxpayer money.

They’re builders.

Their raw materials may be steel and concrete, or power cables, or scrap metal. Some use spreadsheets, or sensitive negotiations, or simple sweat. They’re building the actual buildings that will define Detroit’s skyline for decades to come. They’re building their own businesses, or building up the businesses they’ve been hired to lead. They’re building durable, supportive communities. And as they put people back to work, get them into homes, and help the next generation grow and thrive, they’re building metro Detroit’s future. We think you should know who they are. Read their stories starting on Page 8.

SEE BILLS, PAGE 33

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MICHIGAN BRIEFS

INSIDE

From staff and wire reports. Find the full stories at crainsdetroit.com

MEDC extends Pure Michigan contract

The Michigan Economic Development Corp. approved last week an extension of its contracts with McCann, the advertising agency behind the Pure Michigan campaign. The agency approved a $25.5 million per year contract for tourism marketing and a $7.8 million per year contract for business marketing with the agency, according to an MEDC memorandum. The separate contracts run Oct. 1 to Sept. 30, 2020. Funding for the second year of the contract has not been decided. If it were the same as year one, the tourism advertising contract would total $50.1 million, and the business ad deal would be $15.6 million. McCann, which has an office in Birmingham, won contracts for the state’s business and tourism advertising in 2016 and was awarded a one-year extension in 2017. It has had the Pure Michigan contract since the campaign’s inception in 2006. The MEDC continually releases RFPs for the contract, said Otie McKinley, media and communications manager for the MEDC. McCann is part of McCann Worldgroup, a subsidiary of New Yorkbased advertising holding company Interpublic Group of Cos. Inc. It was

formerly called McCann Erickson. The Pure Michigan campaign, launched in 2006 and powered by the voice of Michigan native actor Tim Allen, has been lauded by the MEDC for driving tourism and increasing the state’s visibility as a four-season destination. It has also been the target of critics, including the Midland-based Mackinac Center for Public Policy, over its estimated return on investment. The PlanetM and the Pure Michigan Business Connect programs were launched through the state’s business marketing arm and have been cited by the MEDC as reasons for growth in the automotive, aerospace, food processing and cybersecurity industries.

MSU: NCAA finds no violations in Nassar scandal

Michigan State University said the NCAA has cleared it of any rules violations in the Larry Nassar sexual-assault scandal, the Associated Press reported. Athletic Director Bill Beekman said the university “cooperated fully with the inquiry” and welcomes the NCAA’s conclusion. The school said it got a letter this week from the NCAA’s vice president for enforcement, Jonathan Duncan. Nassar pleaded guilty to assaulting girls and women while working as a campus sports doctor for Michigan

PURE MICHIGAN

McCann is the advertising agency behind the Pure Michigan campaign.

State athletes and gymnasts in the region. Separately, the university said the NCAA found no violations in how the football and basketball teams responded to assault allegations against players. Beekman’s statement was released last Thursday, the same day former gymnastics coach Kathie Klages appeared in court. She’s charged with lying to investigators about complaints about Nassar. Her attorney says she’ll fight the charges.

Michigan judge orders Ferris State professors to end strike

A Mecosta County judge has ordered striking faculty members at Ferris State University to return to the classroom, the Associated Press reported. The judge granted a preliminary

injunction sought by the university last Monday after professors took to picket lines for the first day of fall semester classes. Professors were back to work last Tuesday on the Big Rapids campus, Ferris Faculty Association president Charles Bacon said. Some faculty members will continue informational pickets over frustration with negotiations on a new contract for the 450 full-time faculty members the group represents, Bacon said. The two sides are split over pay increases and other issues. University President David Eisler’s goal is a contract that helps faculty while keeping tuition affordable at the 14,000-student school, he said.

Campaign planned to attract cruise ships to Great Lakes

A coalition of government and

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business groups is kicking off a campaign to attract cruise ships to the Great Lakes, the Associated Press reported. Michigan Gov. Rick Snyder and other officials attended an announcement of the “Cruise the Great Lakes” initiative last Thursday on Mackinac Island. The announcement coincided with a port of call by Victory 1, a cruise line ship that regularly tours the Great Lakes. The new marketing partnership includes several of the region’s states and Canadian provinces, plus port authorities and local tourism agencies. The partnership said cruise ship tourism on the Great Lakes is expected to grow significantly in coming years. Eight ships were expected to visit this year, representing about 100,000 passenger port visits. Two additional vessels plan to begin operating on the lakes in 2020.

BODY AND MIND:

HOW BEST TO COORDINATE MENTAL AND PHYSICAL HEALTH Crain’s 2018 Health Care Leadership Summit is a must-attend event for providers, agencies and employers as Michigan looks to more tightly coordinate how care is managed and paid for. Attendees will learn from industry experts as they discuss multiple aspects of what is at risk both from an industry perspective and for businesses as a whole.

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ANALYSIS

NAVIGATING NAFTA 2.0

HEALTH CARE

Pay-to-play residency suit adds to Pontiac General woes By Jay Greene jgreene@crain.com

role in an organization or management in a legal or development function, or maybe even something in the nonprofit sector to do something that leverages off my reputation and experience and the broad skills that I have developed. While I’ve had opportunities to do some of those over the years, my legal career was always what I wanted to pursue at that point in time. It’s almost as if I don’t do this now, I probably never will. I have a strong interest in doing something different.

The owners of for-profit Pontiac General Hospital allegedly required the parents of medical school graduate Varun Chopra to make $400,000 in payments in exchange for accepting the 31-year-old into the hospital’s family medicine residency program during the fall of 2016, according to a breach of contract lawsuit filed by Satish and Poonam Chopra. Satish Chopra, an architect from Brampton, Ontario, said in court documents that he made the $400,000 payment to Pontiac General officials in three checks on Sept. 19 and Sept 20 because he was told by hospital officials and representatives it was the only way his son, now 33, could gain entrance into the residency program. The parents expressed shock at the demand, but wrote the checks, court reNeed cords show. Their lawsuit is to know one of a number JJParents of Varun of challenges the Chopra sued hospital and its Pontiac General for owners are facing breach of contract as they deal with because hospital an aging build- demanded ing, infrastruc- $400,000 in ture and mainte- exchange for a nance problems, family medicine charges of em- residency slot for ployee discrimi- their son. Court nation, accredi- meeting set Sept. tation citations 6 and surprise state JJChopra wasn't health inspec- able to start the tions as they in- program in vest millions to November 2016, turn around the but why he left is in hospital. dispute The hospital’s CEO and co-own- JJFor-profit hospier, Sanyam Shar- tal also faces EEOC ma, issued a complaint, signed residency allegations of poor contract to quality controls Chopra the same and lack of staffing date as the final by former check, Sept. 20, a employees fact that the hospital doesn’t dispute. Most unusual, the signed residency agreement also was completed before Chopra had applied to the Electronic Residency Application Service, an established first step that provides a hospital necessary documents to evaluate qualifications of a potential resident. Sharma said in a 2017 deposition that he was told by other hospital officials the $400,000 was a “donation” and not a quid pro quo payment that allowed Chopra to enter the hospital’s 16-physician family medicine residency program.

SEE MCLAUGHLIN, PAGE 32

SEE PONTIAC, PAGE 30

New trade pact likely to reduce automotive competition, raise prices By Dustin Walsh dwalsh@crain.com

The U.S., Mexico and Canada are likely to come to an agreement in principle on a new, updated North American Free Trade Agreement. The original NAFTA, implemented in 1994, was an ambitious economic accord that created a powerful $20 trillion trilateral trade bloc. But it’s been friend and foe to politicians, laborers and businesses in North America. Advocates document the strong economic growth of its three member countries, while its adversaries correctly point to the loss of well-paid U.S. manufacturing jobs to low-wage countries, such as Mexico.

Need to know

JJAutomakers may find it cheaper to pay

tariffs than meet deal requirements

JJWage threshold may actually hurt Mexico JJGlobal competition threatened

It didn’t make any fans in Metro Detroit’s labor segment. A joint statement last week by the leaders of the UAW, AFL-CIO, steelworkers, machinists and communication workers unions said NAFTA “has had a devastating impact on workers.” President Donald Trump, a proponent of mercantilism, called NAFTA “the worst trade deal ever

signed” and since hitting the campaign trail in 2015 has pledged to overhaul or terminate the agreement. He’s succeeded by unveiling a new, tentative U.S.-Mexico trade agreement last week — Canada was expected to join the deal by Friday, after this story went to print. The new agreement requires congressional approval as well as a formal measure to end the original NAFTA, which takes six months to initiate. Trump argues the new agreement will boost U.S. jobs and benefit several sectors, including automotive. Through U.S. economic might, Trump is using NAFTA to force companies to abandon cross-border supply chain in favor of more expen-

BLOOMBERG

sive and onerous domestic production. The result is higher prices for consumers and a less competitive automotive industry in North America with no guarantee of new jobs. But first, let’s take a look at what automotive-specific changes are in the agreement established by U.S. and Mexican negotiators: J The amount of North American content a vehicle must have in order to pass duty-free across borders is raised to 75 percent from its current level of 62.5 percent. J At least 40 percent to 45 percent of vehicles imported must be built in factories paying an average wage of at least $16 an hour. SEE NAFTA, PAGE 32

Q&A

McLaughlin helped change Detroit’s landscape Kirk Pinho

kpinho@crain.com

You won’t find many large real estate projects in and around Detroit that don’t have Lawrence McLaughlin’s fingerprints on them. Now after more than four decades with Detroit-based law firm Honigman Miller Schwartz and Cohn LLP, McLaughlin is stepping down at the end of the year from his position as chairman of its real estate department to pursue other endeavors professionally. “It’s almost as if I don’t do this

now, I probably never will,” the Wayne State University law school graduate said in an interview that covered topics ranging from the creation of the RenaisLawrence sance Center to McLaughlin: the county’s new Leaving law firm. criminal justice complex at Warren and I-75, two projects that are bookmarking Mc-

Laughlin’s career at one of the region’s dominant real estate law firms. This conversation has been edited and condensed. So, why are you stepping down now?

Two things. I’m going on 42 years with this firm and practicing, and this will be the 20th year that I have served as department chair. While it’s been a tremendously successful and rewarding career for me, I’ve always had in the back of my mind that I’d like to step into a broader role on the business side, either a leadership

MUST READS OF THE WEEK Furniture startup adds to collection

Cocktail and food-tasting enterprise wins

Vocational education high school undergoes updates

Growing furniture startup Floyd expands with first sofa. Page 34

Toma Detroit wins $50,000 Hatch Prize. Page 34

Breithaupt trade school set to reopen after makeover. Page 7

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Garden Fresh Gourmet founder Jack Aronson.

Garden Fresh founder: ‘I would do anything and work with anybody to keep it in Ferndale’ By Sherri Welch swelch@crain.com

Garden Fresh Gourmet founder Jack Aronson said he’d consider re-engaging with the Ferndale-based business after news that Campbell Soup Co. is planning to sell it as part of a wider turnaround plan to ignite soup and snack growth. Campbell announced Thursday its plan to sell its international operations and fresh-food unit — including the Garden Fresh Gourmet salsa and hummus brand it bought in 2015 — after considering the sale of the entire company. The Camden, N.J.based company said Thursday it’s working urgently to complete all the moves by next July. Garden Fresh “is something we built,” Aronson told Crain's Thursday morning. “But more importantly, we have a lot of folks there. “I would do anything and work with anybody to keep it in Ferndale.” Aronson and his wife Annette sold the company to Campbell in 2015, rather than other Fortune 500 companies that had approached it, because Campbell’s former President and CEO Denise Morrison promised to keep the business in Ferndale, retain its 450 employees, make investments and never change a recipe without the couple’s approval. As the deal was finalized, the couple met with employees and offered them bonuses payable when the sale closed. Those bonuses added up to millions of dollars for employees. Since acquiring the company,

Need to know

J Garden Fresh founder Jack Aronson would consider re-engaging with Ferndale business if asked J Concern for future of business he and his wife built, employees there would prompt new involvement J Campbell Soup bought Garden Fresh in 2015

Campbell has made significant investments there, including a $7 million expansion to give it 20,000 square feet of additional manufacturing and warehouse space. Despite pressure from activist investor Dan Loeb to find a buyer amid a three-year sales slump and a sliding stock price, Campbell is abandoning its efforts to become a more fresh-oriented company and will pursue a turnaround plan to ignite soup and snack growth in its key North American market, it said in a statement Thursday. The company’s board, which has been reviewing operations since the abrupt departure of Morrison in May, plans to use the proceeds from the sales of brands including Bolthouse Farms and Arnott’s, an Australian snack food company, to pay down debt. The company is also boosting its cost-cutting target as it tries to slim down. The international operations and refrigerated-foods business bring in $2.1 billion in annual revenue, MarketWatch reported.

The company that remains will be U.S.-focused, with revenue split nearly evenly between Campbell soups, meals and drinks, and its more promising snack business, MarketWatch said. The planned divestitures would cut Campbell’s revenue by about 25 percent. Loeb has criticized the board’s “abysmal oversight” and argued the company should find a strategic buyer. Third Point, the hedge fund he runs, started building up its stake in Campbell after Morrison’s departure. It said in a regulatory filing earlier this month that it had partnered with fellow investor George Strawbridge to push for a sale of the company. They collectively hold about 8.4 percent of the soup maker. Third Point and Strawbridge weren’t immediately available to comment. “We believe these actions will put us on a path to create sustainable shareholder value,” interim CEO Keith McLoughlin said in a statement as the company announced results. Campbell said adjusted profit will be $2.45 to $2.53 per share in fiscal 2019, missing the average estimate of $2.67. “Even though I was sad to see Denise Morrison go, I have tremendous respect for the Campbell family, and I’m glad they didn’t sell off their entire business,” Aronson said. “They are one of the icon brands in this country that I have a tremendous amount of respect for.” Bloomberg reporter Craig Giammona contributed to this report.

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CaringForKidsSept.indd 1

ruptured into her spinal cord and the cervical spine. She was basically paralyzed on her right side. She had surgery to remove it; we stayed at Children’s Hospital for two months. They rallied around her. Burns: How is she now? Wyckoff: She’s great. She went from a wheelchair to a walker and now she’s walking around with a cane. She works hard at therapy, and she’s looking forward to school. Burns: These are the stories that make our job worthwhile. Tell us about your D.C. experience. Wyckoff: Going to D.C. was a whirlwind. We warned Claire that it would be a lot of work but worth it to meet all the people and let them know how important this bill would be for everyone. We feel it’s important to be a voice.

Tonya Klein, founder, Healing Kids Foundation

Brett Tillander, CEO, Boys and Girls Club of Oakland and Macomb Counties

Larry Burns: Tell us about your foundation. Tonya Klein: The Healing Kids Foundation is a nonprofit designed to help pediatric burn survivors through Children’s Hospital of Michigan. We aim to promote burn awareness and prevention in Detroit and the surrounding cities. Burns: How did you decide to create a foundation versus just wanting to help from time to time? Klein: In 2014, my husband, Justin, was going through his pediatric surgery fellowship, and he would come home and talk about some of his cases in pediatric surgery, specifically with the pediatric surgeons at Children’s Hospital of Michigan. A lot of children’s hospitals don’t do burn surgeries; it’s typically an adults’ surgeon that does the burn surgeries, so (Children’s Hospital) is unique. Learning what these burn survivors go through struck something in me to want to help. I came up with super hero boxes that I would deliver to the hospital for the kids, and then it just evolved. There are a lot of things children who go through burn surgery need post-operative, like burn dressings and pressure garments, and insurance companies don’t cover those costs. I also wanted to send children to burn camp. There’s an amazing burn camp in Jackson called the Great Lakes Burn Camp. Burns: How did you get connected with our foundation? Klein: When you came on board, I had heard that you

Larry Burns: What does the Boys and Girls Club do in today’s world? Brett Tillander: Our organization started in Royal Oak in a little log cabin. We’re fortunate to be heading into our 60th anniversary. The beauty of Boys and Girls Clubs is the opportunity to be exceptionally responsive to the communities we serve. We serve boys and girls ages 6 to 18; our annual membership fee is $50 a year. It allows them to participate in a variety of programs, whether we’re focused on academic success or healthy minds and healthy hearts, or developing leadership skills and strong character for our next generations. Burns: Where are the Boys and Girls clubs in each of those counties? Tillander: We’re in Royal Oak. We opened in Ferndale in 2006; a woman at Ferndale schools used to see kids sit outside of Ferndale High School with no place to go in the winter and wait for a ride in temperatures that nobody should be outside for, and she wrote a $500 grant (to start that program). In 2011 we opened in Southfield at the Civic Center. We have a location in Washington Township as well. Burns: The Children’s Hospital of Michigan Foundation recently granted funding to a program with your organization called Connect Today. Tell us about that program. Tillander: It deals with significant issues of depression; your foundation has led on this issue. More than 50 percent of kids who need mental health services do not receive treatment; they don’t have

were starting more partnerships, so I took the chance to reach out. I’m blessed to be partnered with you and your team. Burns: Talk about your first event coming up in September. Klein: It’s called the Super Hero Dash; it’s Sunday, Sept. 23 at the sports complex field at Belle Isle. We’ll have inflatable obstacle courses, a superhero food truck, a DJ and family-friendly games. We’re looking to have an amazing time to support these burn survivors. (Details at healingkidsfoundation.com). Burns: You recently wrote a children’s book? Klein: Yes. I’m calling it “Healing Heroes to the Rescue.” The book has these healing heroes help children understand burn prevention. Burns: In five or 10 years, where would you like to see your foundation? Klein: I’m hoping through awareness and prevention we don’t have many burn injuries. A burn injury can be a lifelong journey to recovery. There are psychological and emotional components to healing. My vision is to help provide a community of connectedness and support for every survivor.

access to it. Through your support, we’ll now be able to deliver mental health services to all four of our locations to those kids who need it most and their families. Yesterday, two club members went directly to a staff member, privately, and told them they were dealing with mental health issues. In one of those cases, the parent was not receptive at first, but then once we were able to go deeper with her, it became clear there was a real need. We know that when young people are not treated early on when it comes to mental health it plays out in their adult life; often we have issues around alcohol use and drug abuse. If we bring those services to them when they’re younger, it eliminates huge costs and the negative impact on communities across the state. Burns: What are some of your other plans for the next few years? Tillander: We’re focused on bringing the programs and services that we’re known for to the kids that we serve and have for 60 years now, to communities who need us most. Our board and our club are focused on that.

8/28/18 5:09 PM

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OPINION COMMENTARY

Driver fee forgiveness a lifeline for some

ive years ago, Detroiter Sterling Dickerson’s driver’s license was suspended after he failed to pay off nearly $2,000 in Driver Responsibility Fees — a two-year tax the state levied on top of ticket fines — for his municipal driving infractions. “I was able to pay off my tickets off, but those responsibility fees left me in a hole with the state treasury,” said Dickerson, 27. “It really was a big burden over the years trying to pay that amount.” His debt to the state left Dickerson without a license, forcing him get rides from friends and family members to low-wage jobs, navigate the city’s spotty bus service to get to work or occasionally just break the law. “Sometimes I would just risk driving to work with my car, hoping I didn’t get caught,” he said. “I was caught in a trap.” Since I first wrote a year ago about the 350,000 Michigan motorists owing some $637 million in unpaid Driver Responsibility Fees, I've heard countless similar stories from drivers across the state like Dickerson who were saddled with these fees that the Legislature and then-Gov. Jennifer Granholm imposed in 2003 to help balance the state’s budget. That figure started to dwindle earlier this year, and on Oct. 1 will be zero, after the Legislature and Gov. Rick Snyder decided to stop trying to collect this debt. Policymakers came to the realization that all it was doing was keeping these 350,000 people from better employment opportunities — or any job at all. Dickerson got his driver fees wiped away early after completing a 10hour workforce training course. His license was restored in May, and it opened up a new opportunity to advance into a better job that pays more at the Octapharma Plasma donation center in Redford Township. “I am driving legally now,” he told me. “Having my license has definitely made my life better.” Dickerson was among 13,500 drivers who participated in a qualifying workforce training program since April to get their fees forgiven before the debt gets entirely wiped out on Oct. 1, according to the Michigan De-

CHAD LIVENGOOD clivengood@crain.com

partment of Treasury. As of late August, 1,566 Detroiters had gotten their fees forgiven through a workforce training program, said Robin Johnston, spokesman for the Detroit Employment Solutions Corp., the city’s workforce agency. An additional 27,000 motorists statewide got their debt wiped away March 30 because they were in a payment plan prior to Feb. 1, according to Treasury. Dickerson was among those drivers in the payment plan, owing about $1,000 still on the $2,000 in fines he accumulated in 2013. About 305,000 drivers statewide will have their collective $572 million in debt forgiven next month when the amnesty program fully kicks in with the state’s 2019 fiscal year. In this era of deep distrust of government and institutions, the state’s swift move to end this collection of uncollectible debt was a rare display of bipartisan cooperation. The outstanding debt these drivers owed was first brought to my attention by Strategic Staffing Solutions CEO Cindy Pasky and Dave Meador, vice chairman of DTE Energy Co. Pasky and Meador co-chair Mayor Mike Duggan’s workforce development board. And one of Duggan’s tasks for that panel of corporate and union leaders is to identify and eliminate barriers to Detroiters getting employed. The high cost of auto insurance, poverty and the availability of mass transportation are the obvious barriers. But these driver fees, which in some cases totaled more than $10,000 for a single driver, were seen as the first barrier to even getting

CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

Detroiter Sterling Dickerson had his license restored in May and was able to advance into a better job.

auto insurance (if one could afford it). Pasky and Meador, along with the city’s workforce development director, Jeff Donofrio, went to work advocating for the Legislature to consider granting some relief of the fines, particularly for citizens who couldn’t get jobs they trained for in prison programs. The Republican-controlled Legislature, as it turned out, had an appetite to put a final nail in the coffin of these Granholm-era fees that they started repealing five years ago. As it turns out, this amnesty program could end up being just as relieving as any tax cut for these 350,000 adults, many of whom have been restrained in climbing the economic ladder without access to a vehicle. Detroiter Ashley Griesert, 34, got a

speeding ticket just after her 19th birthday. To make things worse, she had let her vehicle registration lapse, and she was driving without insurance. Those driving infractions resulted in three Driver Responsibility Fees, which were levied for two consecutive years, totaling $1,800. Then came another $200 in late fees for the unpaid fines. Griesert admits to being “young and dumb” and ignoring the collection bills that initially came. “I didn’t know if you didn’t pay the ticket, that your license was going to be suspended,” she said. Over the course of nearly 15 years, Griesert paid off $1,200 of the fines. But for most of her adult years, she has navigated life without a driver’s license, unable to scrape up enough

money to pay off the debt. “You were paying more for the Driver Responsibility Fee than you were for the actual ticket,” said Griesert, an associate producer for the substance abuse television show “Ask the Messengers” on WMYD-Channel 20. Griesert recently had her Driver Responsibility Fees forgiven after completing the workforce training course. Now, she’s just a $225 payment of an outstanding ticket and a driver’s test away from getting her license restored. “Because it’s been so long, I have to take a driver’s test again,” she said. “But it will be worth it.”

point out several nations with superior systems, but they never mention the huge social costs for that superiority. Just take a look at the cost of Medicare, which is in the hundreds of billions every year. Is there a simple solution? Of course not. And when our local hospitals get caught up in either misdeeds or disputes between doctors and hospitals, it makes a tough system even tougher. Since our health care is so important, let us also be sure we keep it out of our politicians’ hands. In the next couple of months, we are going to hear the candidates offering simplis-

tic solutions to extremely difficult problems. I hope that this recent wave of challenges for our hospital systems is over, and we can let the hospitals do what they are supposed to do, while our doctors concentrate on their patients. At least, that is how it is supposed to work.

Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

Let’s get back to treating patients

eaumont Hospital is probably still trying to figure out where to get the tens of millions of dollars that it had to pay in fines. Henry Ford had to cough up a couple of million to pay their fine. And the DMC seems to have come to terms with its doctors and signed a new contract that should bring peace to the Medical Center for a few years. Now, maybe the hospitals and doctors can get back to the business that they were supposed to be doing all along: taking care of their patients. There seems to be plenty of obstacles to getting good patient care these days. And when we have these mas-

KEITH CRAIN Editor-in-chief

sive distractions, you can’t help but wonder what impact, if any, they have on the attention you are getting from your doctor. Mind you, the vast majority of doc-

tors and nurses in our community are interested only in taking care of their patients. But they, like everyone in health care, have gotten swept up in all these conflicts in that business. Sure, a great deal of the problems are simply money. Or as we like to say: It is not the money, it is the amount. But hopefully, all this is behind us, and we can spend our time devoted to making available the best health care delivery system in the nation, not an easy challenge even without the distractions. I am glad no one has given me the task of straightening out our health care system. People are quick to

More on WJR Hear Crain’s Group Publisher Mary Kramer and Managing Editor Michael Lee talk about the week’s stories every Monday morning on WJR 760 AM’s Paul W. Smith Show.

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Breithaupt trade school set to reopen after makeover By Chad Livengood clivengood@crain.com

A second vocational-education high school Detroit is set to reopen this week after receiving millions of dollars in renovations underwritten in part by local corporations and philanthropic foundations. The Breithaupt Career and Technical Center, 9300 Hubbell Ave., on Detroit’s west side has undergone extensive interior and exterior updates this summer as part of a three-year effort to revitalize the city’s languishing career and technical education schools to address workforce needs. Last summer, a group of business executives led by DTE Energy Co. Vice Chairman Dave Meador breathed new life into Randolph Technical High School, renovating classrooms, buying new equipment and supplies for the construction trades classes and starting evening training classes for adults to better utilize the facility. The rehab work was coordinated by Mayor Mike Duggan’s workforce development office, which has forged a partnership with the Detroit school district to make capital and program improvements to Randolph and Breithaupt high schools. This summer, they’ve been working on rehabilitating the Breithaupt, which houses the school district’s culinary arts, cosmetology and automotive service and repair programs. The renovations include a new concrete walkway entrances, painting walls, installing new floors, modernizing the student-run restaurant and buying equipment for a new welding program. The Breithaupt building, which was a manufacturing facility until it was converted into a school in the 1980s, has five kitchens, a restaurant, banquet hall, bakery and cafe that serve as the training facility for school’s culinary arts program.

“It was not operating properly, so we’re fixing it for them.” Jay Williams, DTE

City officials set a goal of raising $9 million for improving the Breithaupt facilities. Dan Gilbert’s Quicken Loans Inc. and his Bedrock LLC real estate management firm previously announced a donation of $500,000 cash and $500,000 for in-kind services, such as construction management. The rest of the corporate and philanthropic donors to the project will be announced later in September, said Jeff Donofrio, executive director of workforce development for Duggan. The donations for Breithaupt will include new funding for buying food, which the cash-strapped Detroit school district has often struggled to be able to afford to buy. “Even if all of the kids were here, they couldn’t pay for the food a lot of times to do the culinary training,” Donofrio said. In the kitchens, safety improvements to the floors and ceilings have been made, including the fire suppression system. “It was not operating properly, so we’re fixing it for them,” said Jay Wil-

Need to know

JJBreithaupt career tech high school in

Detroit gets makeover

JJCorporations and foundations funding facility and program improvements JJPart of three-year effort to revitalize Detroit's languishing career and technical education high schools

liams, a senior project manager at DTE Energy who is on loan to the city to work on the school projects. “And we’re working on the ventilation as well.”

Detroit Public Schools Community District begins its new school year Tuesday after the Labor Day holiday. Last year, Breithaupt had about 300 students, half of whom were in the culinary arts program, Donofrio said. This fall, officials hope to see enrollment grow to nearly 500 with the improved facilities and programs. Later this fall, they plan to begin offering evening courses to nearly 200 adults. CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

The newest car available for Detroit students in the automotive service program at Breithaupt Career and Technical Center to work on is a 2004 Ford Mustang.

HEALTHY ENVIRONMENT, HEALTHY ECONOMY. At DTE Energy, we don’t believe we have to choose between a healthy environment and a healthy economy. We are committed to reducing carbon emissions by more than 80%, while offering reliable and affordable energy to our customers. Better economy, better environment. We can have both.

Learn more at empoweringmichigan.com/mi-power.

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SPECIAL REPORT

40 under 40

Stephanie Amaimo

Dan Austin

Ron Bartell

Michael Bassirpour

Will Branch

Cassie Brenske

Melissa Butler

Tamira Chapman

Jeff Donofrio

Kimberly Dowdell

Kerry Duggan

Rana Elmir

Lena Epstein

Adam Finkel

Jeff Glover

Regan Grant

Suneel Gupta

Jessica Hauser

Seth Herkowitz

Anthony LaVerde

Andrew Leber

Sri Maddipati

Chris McCuiston

Kacee Must

Sanford Nelson

Alison Orlans

Krysta Pate

Jeanette Pierce

Khalil Rahal

Kevin Roach

Omari Rush

Jacqlyn Smith

Haley Stevens

Joni Thrower Davis

Linzie Venegas

David Vermiglio

Joseph Vernon

Vijay Virupannavar

Donovan White

Dave Winter

RJ Wolney

Stephanie Amaimo, 35

Vice President, Investor Relations, Fortis Inc.

tephanie Amaimo didn’t plan on ending up in the utility sector, but here she is, vice president of investor relations at Fortis, one of the top 15 utilities in North America. This makes Amaimo a third-generation utility worker; both her father and grandfather worked for Detroit Edison. “I always thought I’d end up at an accounting firm or in the auto supplier industry,” said Amaimo, who has degrees in accounting and finance. “Utilities must be part of my DNA.” Amaimo’s genetically coded path began nearly 15 years ago with a three-month accounting and finance internship at International Transmission Company, the energy industry’s leading electricity transmission company. It was a good fit, and a second internship evolved that gave Amaimo the opportunity to experience ITC’s initial public offering in 2005 “under the leadership of some of the best mentors in the field.” “They instilled in me do-the-rightthing morals and a mentality of perseverance that I’ve carried with me throughout my career,” Amaimo said. That experience and perseverance would be put to good use. Amaimo was the head of the ITC investor relations team during the Fortis acquisition effort, one of the largest cash/ stock acquisitions between a Canadian and U.S. utility in recent history.

“It was unique and rewarding to be able to redo as a director what I had done previously as an intern.” “It was unique and rewarding to be able to redo as a director what I had done previously as an intern,” Amaimo said of the experience. Recognized for her leadership in the transaction, Amaimo was pro-

moted to director of investor relations for Fortis. A year later she was named Fortis’ youngest vice president. “Supporting Fortis as we continually strive to deliver safe, reliable and

clean energy solutions gives me a sense of purpose,” Amaimo said. “Utilities are essential. There’s a greater good in keeping the lights on.” — Laura Cassar

Ron Bartell, 36 President, Kuzzo’s Chicken and Waffles| R&J Development

onald Bartell was lucky. He was a cornerback with the St. Louis Rams when Philadelphia Eagles fullback Owen Schmitt smashed into him on a run play in 2011. The collision broke Bartell’s neck in two spots, and although he missed the rest of the season, the injury healed without surgery. “It made me appreciate the planning I had been doing for my lifelong career, which is business,” the Detroit native said. “I’ve been an entrepreneur since the first day I received a scholarship offer.” Bartell, 36, spent nine years in the NFL, including one game with the Detroit Lions in 2013. He retired and launched into the next phase: restaurateur. In January 2015, he opened Kuzzo’s Chicken & Waffles at 19345 Livernois Ave. in Detroit. It’s proven so popular that Bartell plans to open a second Kuzzo’s at a larger downtown location in early 2020. In August, he said he signed a fiveyear lease for a 4,000-square-foot location in a to-be-built development called The Woodward @ Midtown being constructed by a developer called Queen Lillian II LLC. The site is at Woodward and Stimson just south of Mack.

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R “I’ve been an entrepreneur since the first day I received a scholarship offer.”

Construction of the building, which will include retail and residential space, is expected to take 18 months after work begins this fall, Bartell said, and then his restaurant build-out will take two months. The new Kuzzo’s will have a larger kitchen. The first restaurant’s isn’t large enough to keep up at times, Bartell said. “The biggest lesson I learned is always overbuild your kitchen,” he said. He also said he plans to seek a liquor license at the second Kuzzo’s to capture pre- and post-game and event attendance from the nearby sports and entertainment venues. Bartell doesn’t plan any food changes, because Kuzzo’s has proven to be a winning recipe. The new Kuzzo’s is expected to seat up to 125. The current restaurant is 2,800 square feet and seats 80, he said. Bartell opened the first Kuzzo’s as part of his investment in properties along the Avenue of Fashion strip of Livernois Avenue between McNichols and Eight Mile roads. It has 35 employees and did $2.3 million in sales last year, and will do about the same this year, Bartell said. He added that he expects the new location to generate $3 million to $3.5 million. “The restaurant business is a grind. We’ve been open four years. A lot of places don’t make it that long,” he said. Bartell grew up in northwest Detroit and is a Renaissance High School graduate. — Bill Shea

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Dan Austin, 37 Senior Account Executive, Van Dyke Horn

an Austin has gone from the Detroit Free Press editorial board to Detroit Mayor Mike Duggan’s administration to a high-level public relations position in just a few short years. But most recently, the 37-year-old senior account executive for Van Dyke Horn Public Relations helped craft the messaging for a state legislative package that is partially financing a series of monumental construction projects in downtown Detroit. Austin, a graduate of Michigan State University who also runs the Historic Detroit website tracking the city’s buildings and architectural history, had the challenge of making the public case for legislation that some viewed as Detroit-specific to a state Legislature that had in recent years dealt with Motor City issues like the bankruptcy, public lighting authority and its public school system. “There was Detroit burnout,” said Austin, who joined Van Dyke Horn a year after becoming deputy communications director for Duggan. So far, the end result of the socalled MiThrive legislation has been $618.1 million in brownfield financing for four Dan Gilbert construction projects downtown totaling $2.14 billion in capital investment. But Austin and others have been quick to note that while the Detroit projects for Gilbert — whose name was attached to the legislation early

J Wolney has been on the ground floor of acquiring, rehabilitating and delivering real estate projects throughout the Bedrock wheelhouse in downtown Detroit. “We’ve invested about $3.5 billion to date,” Wolney said. “Initially we’ve been focused on commercial properties like first floor retail. Moving forward we have a large and growing pipeline of ‘ground up’ development projects — mixed use with a heavy focus on downtown office space and multifamily residential. We want to make Detroit an 18or 24-hour city like other parts of the country.” Executing that ambitious vision has required new financing tools. Wolney played a leading role in the statewide legislative effort to create a new a tax increment financing incentive tool, known as MI Thrive, signed into law in June 2017. Wolney is now applying the tool to over 4 million square feet and $2.1 billion of Bedrock developments. Wolney was also a key member of the Amazon HQ2 proposal team. “That was an amazing regional collaboration,” Wolney said, noting that the effort included representatives from Wayne County, Detroit Regional Chamber, State of Michigan, City of Windsor and many others. “Despite Amazon’s decision to pass, it was a huge win for all the parties involved. It created a very constructive dialogue that we’re still building on today,” Wolney said. “We all realized how competitive we are, and can be, with proposals like this in the future. It served as a great validation of all the talent and great things we’ve got going here already.” — Eric Harabadian

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“It’s about how we can take places, sites in every corner of the state that have sat vacant and unused in some cases for decades and find creative solutions for and help revitalize them."

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on in the process when his lieutenants testified in Lansing in its favor in late 2016 — were the first to receive financing, projects from around the state are eligible for the incentives. “It’s about how we can take places, sites in every corner of the state that have sat vacant and unused in some cases for decades and find creative solutions for and help revitalize them,” he said. But more locally, Austin’s His-

toricDetroit.org website has become a go-to encyclopedia for history buffs, journalists, Detroiters and others. It gets about 25,000 page views per month and its social media accounts have around 57,000 follows. Austin said he spends about 10 hours a week on the project, which started in 2011 and is part of his broader effort to “try my best to lobby to turn bulldozers off.” — Kirk Pinho

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RJ Wolney, 39 Vice President of Finance, Bedrock “We want to make Detroit an 18- or 24-hour city like other parts of the country.”

Business

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CRAIN’S 40 UNDER 40

Cassie Brenske, 34 Chief Development Officer, Detroit Riverfront Conservancy

s the Detroit Riverfront Conservancy’s first-ever chief development officer, Cassie Brenske is leading fundraising efforts to complete a 5.5mile redevelopment of the city’s riverfront from Belle Isle to the Ambassador Bridge. A year into her new role, she has built the conservancy’s first formal fundraising team — now five people strong — and is overseeing every aspect of fundraising for the organization, from annual giving to capital needs and endowment, fundraising events and stewardship of major donors. She’s charged with completing a $100 million-$150 million campaign that’s currently in the silent phase. It will fund projects including, on the west riverfront, two miles of the Riverwalk extending it to the Ambassador Bridge and a 22-acre park an endowment to help fund the permanent maintenance and programming of the Riverwalk and annual operations. Brenske joined the conservancy after making her mark at the Detroit Symphony Orchestra and Saginaw Bay Symphony Orchestra. A graduate of Michigan State University’s journalism program, she shifted careers after graduating in 2007 when she saw friends laid off from The Saginaw News. She landed at the Saginaw Bay Symphony Orchestra as marketing coordinator and

“I truly love this community and the philanthropists that I’ve had the opportunity to meet in Detroit.”

office manager for three years, a role that brought her early experience in annual campaigns, special events and corporate solicitations, among other things. In 2011, she applied for a marketing position with the Detroit Symphony Orchestra but with encouragement from the orchestra’s former executive vice president, Paul Hogle, hired in as a major gift officer for two and a half years before being named acting deputy director of the advancement team in April 2014. She served in the interim role for about six months before being named director of individual giving, leading a team of four responsible for raising nearly $5 million in annual fund support. Among other accomplishments, Brenske was instrumental in securing the DSO’s first, seven-figure gift — a $1.5 million commitment — to endow the orchestra’s principal timpani chair. After six years, when she was looking for something new to do and considering jobs outside of Michigan, the position at the Detroit RiverFront Conservancy opened up, keeping her in Detroit. “I truly love this community and the philanthropists that I’ve had the opportunity to meet in Detroit,” Brenske said. “It’s why I can’t imagine doing anything else, anywhere else.” — Sherri Welch

Will Branch, 38

“We wanted to do an ethical job and make a flavorful product.”

hen asked how she got where she is today, Melissa Butler, founder and CEO of luxury cosmetic company The Lip Bar, had a simple answer. “Not stopping. That’s my super power; I don’t believe in the word no,” Butler said. “I’d rather fail than regret.” That attitude of resilience is part of the reason Butler got a chauffeur’s license to drive her moving beauty bar, The Lip Bar truck. “Driving a Prius through New York City is tough; try driving a 27-foot truck covered in lips!” Butler said of her efforts to get her product directly into the hands of consumers. Resiliency is also why her product will roll out to an additional 400 Target stores this fall. (It’s currently stocked at 150 locations.) The lip line can also be purchased online at thelipbar.com. “I hate to settle,” said Butler, who was an unsatisfied Wall Street analyst when she started her beauty-product business out of her kitchen. “You don’t have to use chemicals to have quality cosmetics.” Butler researched and launched a nontoxic, vegan, cruelty-free lipstick line and never looked back. Even a challenging visit to ABC reality show “The Shark Tank” only convinced Butler to continue on her mission to challenge the beauty standard. That mission brought the Detroit native home three years ago, a move that tripled sales despite her nervousness about leaving her New York network behind. “I was pleasantly surprised at the level of support Detroit gives to its

Kevin Roach, 37

Co-owner and CEO, Corridor Sausage, LLC

CEO, Methodist Children’s Home Society

reaking into the sausage business is a lot more daunting than it seems. Big family-run companies dominate the industry, and it’s nearly impossible for the little guy to carve a way in. Not to mention unfeasible startup costs and a steeper-than-average learning curve. Most who make it over those hurdles are burned out by scrupulous oversight of one of the country’s most heavily regulated industries. Then, there’s William Branch — sausage sage, casing connoisseur. Really, he’s a metro Detroiter who had food industry experience, a business idea and zero taste for anyone telling him he couldn’t do it. Branch founded Corridor Sausage with business partner Zachary Klein in 2009 after working out a deal with a small butcher shop in Howell. “We begged, borrowed and stole to get them to let us use it,” Branch said. They worked for as many hours at the shop as they were allowed, perfecting the craft, raising capital and making a name for themselves. Two

years later, they secured space in Eastern Market and, in 2015, they won a highly competitive contract from The Henry Ford, which remains one of their largest accounts. Not to be intimidated by larger competitors that eclipse its production capacity, Corridor just launched a new cooked sausage line to be carried by Meijer and Kroger stores across the region. The company did $1.1 million for revenue in 2017 and expects to double that figure by 2019. It is also looking to beef up its staff of 12 in the coming months. Not bad for the little guy. Branch said the best part has been employing people in Detroit and inspiring other entrepreneurs to follow their business dreams. Successfully breaking into a tough industry is a good feeling, too. “Sausage became kind of a dirty word,” Branch said. “The joke is you never want to see how it’s made. We wanted to do an ethical job and make a flavorful product. We want to prove that it’s still a great product.” — Kurt Nagl

ach day, Methodist Children’s Home Society serves 150 of Michigan’s most vulnerable children and families through residential care, foster care, adoption and independent living services for youth aging out of the foster care system. At the helm is Kevin Roach, who, as an adoptee himself, has keen insight into the power of family and feels called to help the most fragile children — those dealing with a host of issues, including abuse, neglect, mental health challenges and low academic achievement. With that comes a certain complexity. While MCHS grows to help more children, ultimately Roach would like to witness a time when the home’s services are no longer necessary. Until then, he is rolling up his sleeves as executive director, building a staff whose expertise helps children overcome early traumas and grow into healthy young adults. In the three years since Roach came on board, the organization’s operating budget has increased by 53 percent with the addition of more services and more community engagement. Plans are underway to PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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THE ACLU OF MICHIGAN STAFF AND BOARD OF DIRECTORS GIVE OUR HEARTFELT CONGRATULATIONS TO

Melissa Butler, 32

RANA ELMIR Deputy Director

Founder and CEO, The Lip Bar LLC

WE ARE SO PROUD OF THIS RECOGNITION OF YOUR ENORMOUS TALENT.

“I was pleasantly surprised at the level of support Detroit gives to its small business owners.”

small business owners,” Butler said. “Both public and private entities go to bat for small businesses — that’s huge.” Butler’s next goals include expanding her product line to include eyeshadow, highlighters and blush and adding more retail partners. Fulfillment is currently run out of Detroit,

but Butler hopes to also create a manufacturing facility here. More than anything, Butler said, her most important goal is to empower women to believe in their own beauty. “Beauty is inclusive and within everyone.” — Laura Cassar

double the average number of children served per night from 30 to 60 in the residential program. He’s also implemented evidence-based treatment models to ensure stronger outcomes for children and families. Roach credits others for his success and the growth of MCHS: his mother and father who adopted him at age 5 and instilled virtues of integrity, hard work and responsibility; a number of mentors who have guided him in his role as a leader; his own

wife and children; and a staff he looks to for expertise, guidance and support. “Many of us may not have gone through what our children and families have experienced. It doesn’t mean we can’t empathize with feeling lost, scared or hurt, experiencing some level of pain, or being let down by those we entrusted,” Roach said. “The human side of the business is critical.” — Melinda Clynes

“The human side of the business is critical.”

STOREHOUSE IS PROUD TO CONGRATULATE Tamira Chapman and fellow honorees for being recognized as one of Crain's Detroit Business 40 Under 40.

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

CRAIN’S 40 UNDER 40

Michael Bassirpour, 36 CEO, Partner, GLR Advanced Recycling

“I established a good name for myself, which I think is a forgotten art.”

ichael Bassirpour is on a mission to become the largest metal recycler in the Midwest, and he’s making moves in the right direction. Bassirpour, CEO of Roseville-based GLR Advanced Recycling, signed a joint venture agreement in mid-August with Holland-based Padnos recycling — the latest in a string of growth plays. Since taking the helm of GLR in 2014, Bassirpour has expanded the family owned firm from one site and 40 employees to six sites and over 100 employees. He attributes his success to humble beginnings that helped him forge a strong work ethic. When he moved back to metro Detroit from Chicago in 2006, work opportunities were scarce. He had an acquaintance in the recycling business and reached out. “I basically begged him for a job making nothing,” Bassirpour said.

Jeff Donofrio, 38 Executive Director, Workforce Development, City of Detroit

eff Donofrio had one of the more daunting marching orders from Mayor Mike Duggan when he became the city’s executive director of workforce development in the fall of 2015: Find new ways to put 40,000 Detroiters back to work. Almost four years later, the Duggan administration is halfway toward the mayor’s short-term goal of having 240,000 city residents working — the result of a strong economy, rewiring Detroit’s workforce development programs and tackling barriers to employment. Long term, Duggan wants 300,000 residents working. While standing up new job-training programs in the fields of information technology, health care, hospitality and construction trades, Donofrio said he and his team “peeled back” hurdles that prevent qualified Detroiters from getting jobs. In developing a program that has trained 150 patient care technicians for the city’s hospitals, they found out hospitals routinely turned down Detroiters for jobs because they couldn’t quickly produce a copy of their high school diplomas from the Detroit Public Schools Community District. The district had a months-long backlog to retrieve educational records for past students from an old warehouse east of downtown — causing some Detroiters to lose out on job opportunities at the Detroit Medical Center, Henry Ford Hospital and St. John Hospital. “In the health care training we developed, we didn’t expect the biggest barrier would be verification of high school diplomas,” said Donofrio, 38, who is a

Ford Motor Co. government relations manager on loan to the Duggan administration. To help DPSCD, the city recruited Quicken Loans to get employee volunteers to sort and digitize hundreds of thousands of pages. Lear Corp. donated scanners to help make the records available on a website. “It went from a two-to-three-month (turnaround) to a three-or-four-day turnaround time,” Donofrio said. At a prison culinary arts program at the Detroit Reentry Center on Ryan Road, city officials discovered another barrier to post-incarceration employment: driver responsibility fees. The state-level fines on traffic violations had piled up since 2003, and some residents returning from prison faced thousands of dollars in fees before they could get their licenses restored, Donofrio said. Donofrio and his team found 76,000 Detroiters — or 18 percent of the adult population — had an outstanding driver responsibility fee that could sideline them from employment. Donofrio became the mayor’s point man in drawing public attention to the fees and the strain they had become for the state’s workforce. More than 300,000 drivers statewide owed an average of $2,000 each. In March, Gov. Rick Snyder signed legislation that will forgive nearly $630 million in unpaid driver fines on Oct. 1. “If you’re not addressing the barriers (to employment), an individual is not going to be successful over the long term,” Donofrio said. — Chad Livengood

“And I just basically learned the business and everything I needed to know. I established a good name for myself, which I think is a forgotten art.” In 2014, he expanded into the auto recycling market. The shift wasn’t graceful. When Bassirpour approached a local company about partnering in the enterprise, he was laughed out of the office. In its first year of scrapping cars, the business lost money. Now, auto recycling is one of GLR’s fastest-growing segments. Overall, the company is projecting $85 million in revenue this year — an $18 million increase from last year. Driven by the grit that elevated him from scrapping amateur to top brass, Bassirpour hopes to eventually be in all major cities in Michigan, Ohio and Indiana with at least 1,000 employees. “I guess some people operate like, ‘I hope this works,’ and some people operate like, ‘This has to happen,’” he said. “You grind, you hustle and you treat people with respect, honesty and dignity and do what you say you’re going to do, and that goes a long way.” — Kurt Nagl

“In the health care training we developed, we didn’t expect the biggest barrier would be verification of high school diplomas.”

Kimberly Dowdell, 35 Partner, Century Partners “We’re really focusing on the neighborhoods.”

Kerry Duggan, 39

Partner, Sustainability, Ridge-Lane Limited Partners

erry Duggan has traveled the world, but she always knew she would comed back to Detroit. That conviction came to her at age 18 during a Copenhagen coffee house conversation with a stranger. “I was already on my soapbox, pontificating to a fellow traveler about all the big issues I wanted to fix in the world,” said Duggan, who traveled Europe on the Nike All-Star basketball team. “The woman listened to me and then asked a simple question: ‘Can you drink the water where you’re from?’” At that time, said the Farmington Hills native, you couldn’t even “stick a toe” in the Rouge River. With that question, and its answer, Duggan’s broad focus became very narrow. “That random conversation made me realize: it’s always about home,” said Duggan. “Take care of the place you’re from, or what’s the point?” In 2011, she was selected to lead President Barack Obama’s Detroit task force. She also directly advised Vice President Joe Biden on energy, environment and climate. One of her proudest accomplishments in this position includes making the technical case for the conversion to LED streetlights in Detroit. “It’s really about the kids being safe, the neighborhoods being safe, it’s a quality of life that everyone deserves.”

A plac mot in 2 a p mot D ing Det hom chil “I doo

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

rowing up on Detroit’s East and West sides and at her grandma’s Cass Corridor home, Kimberly Dowdell saw the blight of boarded-up buildings — from the former Hudson’s to individual homes. Her interest in architecture began at age 11, when an art teacher asked her to transform a shoe box into a model apartment. The project was more interior design, but Dowdell began thinking about how she could fix the city’s abandoned buildings. With a vision “to revitalize the city,” she became an architect after graduating from Cornell University, the first leg of her 13-year “East Coast tour.” She worked in New York and earned a master of public administration degree from Harvard’s Kennedy School of Government before returning to Detroit in 2015. While working for the city on

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“I’ve never made a secret about it: drawing business to Detroit is my big goal.”

public-private partnerships in development, she met many developers, including David Alade and Andrew Colom, who led Century Partners. She liked their approach and in 2016, they brought her on as the third partner. Within a year, she and Colom, a writer, filmmaker and real estate developer from Mississippi, were married. “With the intensity of all the work you don’t necessarily focus on the relationship” as much, she said, noting that they took their honeymoon to Senegal and South Africa almost 18 months after they were married. They were focusing a major $4 million project to revitalize the Fitzgerald neighborhood along Livernois, which they won in partnership with The Platform, a much larger development company. Now Century and The Platform

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Another feather in her cap: She placed an electric vehicle in Biden’s motorcade for his last tour of Detroit in 2017 — the first electric vehicle in a presidential or vice presidential motorcade since 1902. Duggan spent seven years traveling between Washington, D.C., and Detroit before making the move home with her husband and two children. “I always kept one foot in the door,” said Duggan, who happily

traded a four-mile, 45-minute commute for a nine-minute walk. As a resident in her home state, Duggan made the move from public service to private sector as a partner for sustainability at Ridge-Lane, a strategic advisory firm and merchant-bank. “As our CEO knows, I’m unabashedly a Detroiter,” said Duggan. “I’ve never made a secret about it: drawing business to Detroit is my big goal.” — Laura Cassar PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

are responsible for rehabbing close to 100 homes, about half to be rented and the other half sold to individuals, Dowdell said, and also to maintain and develop smart usage for more than 250 vacant lots. She has tapped former students from University of Michigan Taubman School of Architecture, where she teaches part time, to join Century’s team. Dowdell is passionate about developing a team who believes as she does in the mission of improving Detroit and its neighborhoods. In January, she will take the twoyear presidency of the National Association of Minority Architects. By sometime in 2019, she expects Century to dive into its first commercial or mixed use project. “We’re really focusing on the neighborhoods,” she said. — Vickie Elmer

Crain’s 40 Under Forty HONOREE

ChildrensDMC.org

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CRAIN’S 40 UNDER 40

dam Finkel co-founded Orfin, which does business as Orfin Ventures, with Gregg Orley in 2011 to serve as an investment arm in early stage technology companies for the Orley family. Orfin is a combination of the first syllables of each founder’s last name. Orfin has made 27 investments and created almost 800 jobs, with Finkel leading deal sourcing and due diligence in companies based in places from Tel Aviv to Silicon Valley to Asia. Two of the investments were in spinoffs from the University of Michigan — Santa Clara, Calif.-based Crossbar Inc., which does memory storage for electronic devices, and Qumulo Inc., a software company in Seattle. Orley said that Finkel’s national network of contacts gets Orfin invited to join deals with nationally known investors who normally wouldn’t partner with a small family office. Co-investors over the years include Jeff Bezos, Mark Zuckerberg, Elon Musk, BlackRock Inc. and Kleiner Perkins. “Some of the biggest VCs in the country will call Adam and say, ‘We’re going to invest in a startup, why not join us?,’” said Orley. “And they’ll let us in for less than their normal minimum co-investment. They might, for example, let us in a deal for $1 million as opposed to $3 million. I tell people, I just carry Adam’s briefcase. He’s the leader.” Finkel is on the board of NextGen Connect, which helps find internships for young adults who want to stay in Detroit; has been on the board of Crain’s annual Detroit Homecoming event for five years, recruiting such notable expats as Groupon founders Brad Keywell and Eric Lefkofsky; and has been on the board for six years at Congregation Shaarey Zedek in Southfield. “All avenues I pursue, commercial and philanthropic, are about impact. How can I impact investors and soci-

Jeff Glover, 34 Owner/Realtor, Jeff Glover & Associates/ Keller Williams Realty

eff Glover has been a recognizable fixture in the local real estate industry since 2003. But he does more than sell houses. “After I was in the business about a year and a half I wanted to learn how to teach, train and motivate Realtors,” Glover said. He was running an office for Coldwell Banker Schweitzer in Plymouth when he was given the opportunity to take over the office’s agent training and recruitment. “Through that I found my passion,” Glover said. The experience led Glover to develop Glover U, a sales training program

Sanford Nelson, 29

Adam Finkel, 32

President, Firm Real Estate LLC

Partner, Orfin LLC

“All avenues I pursue, commercial and philanthropic, are about impact.”

ety?” said Finkel. “When we launched Detroit Homecoming, he came forward with a remarkable network and range of contacts he put in action on behalf of Detroit,” said Crain’s Group Publisher Mary Kramer. “I think over the

“I wanted to create a different kind of experience for the consumer as well as Realtor.”

years 30 to 40 percent of all the now nearly 600 attendees came from Adam’s outreach. And that’s a modest estimate. He has a terrific way with people — in person, over the phone and via e-mail.” — Tom Henderson

anford Nelson’s journey as a landlord is only just beginning. The 29-year-old president of Firm Real Estate LLC started buying property in Detroit’s Eastern Market area over 18 months ago and he is showing no signs of slowing down. His company has assembled a portfolio of more than 250,000 square feet spread across more than a dozen buildings, including 110,000 square feet of recently acquired property along the Dequindre Cut, and the University of Michigan graduate has his sights set on more. He is under contract to buy other undisclosed properties in the area. “It’s the most unique and exciting neighborhood in Detroit,” he said last month during a tour of Eastern Market in a colorful electric golf cart. His is a $20 million effort to buy and improve the properties in the country’s largest public food market along with his father, millionaire serial entrepreneur Linden Nelson. Other investors are Don Foss, the billionaire founder of Credit Acceptance, considered the first company to offer subprime auto loans; Marvin Beatty, a Detroit developer who is also chief community officer for Greektown Casino-Hotel; and Larry Mongo, the owner of Cafe d’Mongo’s Speakeasy on Griswold Street downtown. For the time being, he’s addressing long-deferred maintenance on the buildings, like window replacements

“It’s the most unique and exciting neighborhood in Detroit.” and tuck pointing, which will start in the next month. But down the line, the overall plan for the properties could include new residential development — “as many (units) as we can” build, Nelson said — and other buildings. The key, however, is maintaining the district’s history and character as a food market and a place for artists. “We are committed to supporting existing food businesses that are here and increasing the amount of new, modern space for these businesses. That is paramount, No. 1,” Nelson said. “Second to the food industry as being the core identity of the market, art has become a core piece of that. We want to support that, too.” — Kirk Pinho

used by real estate firms across the country. He also founded a separate company, Titleocity, to “re-invent the way title is done.” “The title business is very bland and the process probably hasn’t changed in 50 years,” Glover said. “I wanted to create a different kind of experience for the consumer as well as Realtor. A lot of agents have to track down death certificates, divorce decrees and so on. Title companies don’t go after that kind of info, but Titleocity does. We took all the things that Realtors have issues with and we solved the problem.” And he gives back through Glover’s Heroes, the charitable arm of his organization, which raises money to help out local “heroes,” including first responders, police officers, firefighters, teachers and veterans, with things like home rehab projects. Still, amid all of the bustle of his many business ventures, Glover sells houses. His firm is one of the top-performing residential brokerages in the country. “I still go out on appointments every day,” says Glover. “A lot of people think I’m out of production because I’m the owner. But if you call our office there’s a good chance I’ll take the call and be there to list your property and show your home.” — Eric Harabadian PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

Leading with Purpose C ongr at u l at ions

to Srikanth (Sri) Maddipati, Vice President, Treasurer and Investor Relations of CMS Energy Corporation and Consumers Energ y Company, on being named to Crain’s Detroit Business’ 2018 class of 40 Under Forty. Since joining our financial team in 2014, Sri has led more than $2.5 billion in financings, reduced our company’s borrowing costs and overseen improved credit ratings from Moody’s and Fitch. Sri and his team also have aptly served as the first line of communication for the company with the investment community.

Under Sri’s leadership in communicating CMS Energ y’s value, coupled with consistent industry-leading financial performance, our stock has delivered a 50 percent total shareowner return over the past three years – well in excess of the company’s utility peers and the S&P 500. In 2017, Institutional Investor named CMS Energy a “Most Honored Company.”

“You will spend the majority of your waking hours at work. You deserve to enjoy it.” SRIKANTH (SRI) MADDIPATI Vice President, Treasurer and Investor Relations CMS Energy Corporation and Consumers Energy Company

Sri, congratulations to you, and thanks for all you do to model the way in our quest for World Class Performance Delivering Hometown Service A C M S EN ER GY C O M PA N Y

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@CRAINSDETROIT

T H E A RT O F

ENTERTAINING Corporate Events | Culinary Experiences | Bespoke Weddings

CRAIN’S 40 UNDER 40

Regan Grant, 34 Global Automotive & Transportation Marketing Leader, EY “I’ve had a front row seat to the resurgence of Detroit.”

R cornmanfarms.com

egan Grant’s parents divorced when she was 3, and her mother managed to work full time as a Spanish teacher, earn an advanced degree, raise two children and volunteer. Grant learned important lessons about “being independent and giving back” from her mom. Her father instilled a strong work ethic and she started baby-sitting and mowing lawns at 13. Those lessons serve her well as global automotive and transportation marketing leader at EY, where she manages a global team. Her first job after graduating from the University of Michigan with an English degree was at a trade publish-

Dave Winter, 36 Director of Quality — Americas, Lear Corp.

“Customers demand perfection, but they don’t want to pay for it...”

FACEBOOK.COM/CRAINSDETROIT

er. Then she saw the marketing role at EY in Detroit. “The auto industry sounded so exciting compared to land surveying,” she said. At EY, one of her first tasks was to create “a more distinctive voice” for the automotive consulting group, creating digital content that was more “pithy and provocative.” Because EY’s accounting firm culture is more riskaverse, “we had to take some baby steps to put those messages out,” she said. Yet as results piled up — from press mentions to client calls — the firm’s leaders became more comfortable with the approach Grant recommended. Her work took the practice to “best brand status” among EY’s top

competitors and led to increased revenue for the sector globally. She gives back through her volunteer roles with the United Way of Southeastern Michigan, where she is co-chair of the emerging philanthropists. Through recruiting she has helped grow the Emerging Philanthropists group from five to 240 members. She savors the momentum in the auto sector, and the growing interest in mobility. And she relishes her view of Detroit’s revitalization from EY’s downtown offices, where she has worked for a decade. “I’ve had a front row seat to the resurgence of Detroit,” she said. — Vickie Elmer

or Dave Winter, every day is a new challenge. Automotive production, particularly complex seat production, is not perfect. But customers demand flawlessness. Every time his phone rings, a quality issue could take him to any of Lear Corp.’s approximately 50 seating operations across North and South America. “Every day is a quality struggle,” he said. “Customers demand perfection, but they don’t want to pay for it, so it’s impossible to reach the highest level of customer satisfaction without having all the work streams and value streams to deliver that. How do you span that gap? That’s what keeps me employed.” Winter is a unique quality manager. His previous experience at Lear is on the operations side, allowing him to understand the challenges of perfect production in an imperfect process. Prior to his current role, Winter served as the operations manager for Lear’s Hammond, Ind., seat manufacturing complex outside of Chicago. The plant’s future was in jeopardy at the turn of the decade, as labor costs were high and its largest customer, Ford Motor Co., demanded cost savings from its seat supplier. Winter took charge of UAW negotiations and was able to secure a new contract by creating a two-tier wage, where Lear would separate workers into two disparate job functions, allowing skilled workers to remain on a higher-wage scale and move lessskilled employees to a new lower wage. The new tier allowed Lear to improve margins, cut costs and secure new work for the Hammond complex, which broke ground last year on an expansion that will consolidate its plant under a new 250,000-square-foot plant and hire more than 100 more workers. “The wages were the biggest hinge point and, in the end, we were able to get it done,” he said. “Since, the plant has become more competitive and is winning more contracts. Had we failed, it would have fundamentally changed that plant going forward.” — Dustin Walsh

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“I told him, ‘Just get me in front of them.’ And here I am five and a half years later, still hanging on.”

David Vermiglio, 33 Vice President of Finance, Huron Capital Partners LLC CFO, Four Man Ladder Management

avid Vermiglio was a tax manager with Plante & Moran PLLC from 2006 to 2012. He says it was a good job at a great company, but he didn’t want to do taxes exclusively for the rest of his career. So he asked a headhunter to see what else was out there. “I said, ‘I want something with a lot of variety.’ He called me back six months later and said ‘I’ve got a great opportunity, the perfect job, but you’re not the right guy,’” recounted Vermiglio. The opening was for a controller at Detroit-based Huron Capital Partners LLC, an operationally-focused private equity firm, and he had absolutely no private equity experience. “I told him, ‘Just get me in front of them.’ And here I am five and a half years later, still hanging on,” he joked. He’s doing more than hanging on. Last year, Vermiglio was promoted to VP of finance. “David isn’t your typical accountant,” said Brian Demkowicz, Huron’s managing partner and the person Vermiglio got in front of. “We were looking for someone with high ener-

gy who could relate to the rest of the staff. It’s a high-energy, high-paced business and he came across as that kind of candidate.” Vermiglio is an entrepreneur at heart, too, which made him a good fit for a company whose business is investing in entrepreneurs. In 2015, Vermiglio, his twin brother John and two partners founded Ferndale-based Four Man Ladder Management, a restaurant management company. In 2016, Four Man opened Grey Ghost, a craft-butchery restaurant in the former Ye Olde Butcher Shoppe in the Brush Park neighborhood at East Watson and Woodward Avenue, a property they found reading an article in Crain’s about the sale of the building to owners who planned lofts above groundfloor restaurants. Grey Ghost subsequently was named by the Free Press as its second-best new restaurant. In August, directly across the street from Grey Ghost, Four Man opened Second Best, a neighborhood bar with a 10-item food menu. — Tom Henderson PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

ENERGIZING MICHIGAN’S

Future

Congratulations to Stephanie Amaimo, Vice President, Investor Relations, Fortis, Inc. upon being recognized by Crain’s Detroit Business as one of Crain’s 40-under-40 honorees for 2018. Her ongoing work is instrumental to Fortis’ and ITC’s efforts to energize Michigan’s future by improving electric reliability, increasing electric transmission capacity, and keeping efficient, reliable energy flowing to communities, homes and businesses across the state. The ITC and the Fortis families are proud of her accomplishments and her commitment to the values and culture that make our organizations thrive.

ITCHoldingsCorp I

@ @ITCGrid

ITCHoldings

www.itc-holdings.com

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CRAIN’S 40 UNDER 40

Jessica Hauser, 36 Executive Director, Downtown Boxing Gym Youth Program

“Every day I’m in shock when I see the vast difference our kids are facing for absolutely no reason other than their perceived poverty ... or the color of their skin.”

n 2010, Jessica Hauser was busy with her studies, on a path toward a doctorate degree in political science at the University of Michigan. But a personal training appointment led her to the Downtown Boxing Gym in Detroit. After learning about the gym’s financially struggling youth development program that was having amazing results with local kids, she couldn’t turn back. So she ditched collegiate life and started as executive director, working alongside founder Khali Sweeney. Over the past eight years, she has grown the gym into a thriving organization, establishing it as an official 501(c)3 nonprofit and purchasing and renovating a new building. And her knack for cultivating relationships has helped Hauser build a network of relentless supporters who care about the gym, including Quicken Loans founder and chairman Dan Gilbert and celebrities Madonna and Eminem. A self-admitted worrier, plenty keeps Hauser up at night, but what gets her up in the morning is her re-

sponsibility to be of service. Having grown up poor in Birmingham, she experienced firsthand the impact of a good school district and strong mentors and role models. Hence, she is conscious of the unlevel playing field in Detroit. “Every day I’m in shock when I see the vast difference our kids are facing for absolutely no reason other than their perceived poverty ... or the color of their skin,” Hauser said. “These are brilliant young minds that should be respected as such.” Under Hauser’s leadership, the program has grown from serving 40 young minds to 132. All of its participants have graduated from high school. The organization has six fulltime and seven part-time employees, plus a “small army” of volunteers. Students attend a minimum of three days a week for an average of four years, so close relationships are formed. “When they walk through the doors here, all the layers of stuff that society puts on different people just falls away.” — Melinda Clynes

defining lesson for Rana Elmir on the importance of failure in the pursuit of social justice came when she shouted expletives at her junior high school teacher. The deputy director of the ACLU of Michigan learned U.S. immigrants’ hardships as a child, and has brought those teachings to her work. Elmir, who is Muslim, now builds community trust, speaks on marginalization and coordinates internal affairs for the civil rights organization, which she joined in 2006. What the 35-year-old thinks about most is “co-powering”— empowerment on a level playing field. “When I think about the work I do in communities ... I work for my mother,” she said. Elmir, her parents and her three siblings fled Lebanon in 1986, arriving in Dearborn to a country that sometimes showed disdain. Elmir chose not to translate slurs directed at her parents. Her mother told stories “punctuated by anti-immigrant bias, by anti-Muslim sentiment.” Elmir remembers her quiet frustration bubbled up when she hadn’t brought a book to start studying again after finishing a test early. Her teacher said: “I don’t know what they do in your country, but here in America we bring our books to class.” Elmir responded assertively and was told to leave the classroom after refusing to sit. From outside, rage boiling over, she reopened the door and let loose “a series of really awful names.” Her approach with the teacher certainly wasn’t a success. “Nonetheless, it’s failure of a just cause that keeps us going. I don’t feel like I can sit out a fight,” she said. Hassan Jaber, the CEO of the Dear-

Rana Elmir, 35 Deputy Director, ACLU of Michigan

“When I think about the work I do in communities ... I work for my mother.”

born-based Arab Community Center for Economic and Social Services, said he noticed Elmir for her public speaking, after she first joined the ACLU more than 10 years ago: embracing, but also confronting, challenging subjects. More recently, El-

“The courage — this idea of making it OK for our young people to stay here in Michigan, to try something and to fail and make that OK, is incredibly important.”

Suneel Gupta, 39

Tech Entrepreneur, Co-Founder, Rise Labs

or entrepreneur Suneel Gupta, his venture into politics ended like some business ideas — in failure. Gupta, 39, finished in third place in last month’s Democratic primary in a crowded five-candidate field in the 11th Congressional District. The experience was humbling, but

not unlike a business idea that fizzles out. And Gupta embraces failure as a necessary part of future success. In the tech hubs of Silicon Valley and Boston, entrepreneurs “wear past failures almost as badges of honor,” he said. As he moves forward, Gupta said

mir has influenced ACCESS in an advisory role, including helping it evaluate its communication infrastructure. “Her convictions are deep and real and are tested on a daily basis,” Jaber said. — Annalise Frank

he plans to stay put in Michigan and go to work helping other entrepreneurs pursue their business plans. “The courage — this idea of making it OK for our young people to stay here in Michigan, to try something and to fail and make that OK, is incredibly important,” said Gupta, who co-founded Rise, a nutrition coaching app. His older brother, television journalist and physician Sanjay Gupta, helped brainstorm the original concept. Another family member has helped inspire his entrepreneurial journey: his mother Rani, a refugee from India who came to the U.S. to get her education. She became Ford Motor Company’s first female engineer in 1967. “I want people in Michigan to feel the way she did about Michigan,” Gupta said. Gupta, who sold Rise in 2016 to One Medical for $20 million, said he’s considering some consulting work and other business ventures. His campaign for Congress got him thinking more about what Michigan needs to do to unlock an “entrepreneurial renaissance.” “You have a lot of investors out there who are intellectually curious and excited about Michigan, but they don’t have boots on the ground here,” Gupta said. “What that means is we need more ambassadors to go out there and to able to effectively road show all of the great things we have happening out here to get people excited.” — Chad Livengood PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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CRAIN’S 40 UNDER 40 Candidates for U.S. House of Representatives, Michigan's 11th District

Haley Stevens, 35

“I have inarguably one of the most profound backgrounds in manufacturing of anyone running for Congress in the country — and specifically for what we do and who we are as a region.”

s Haley Stevens was managing a U.S. Treasury Department task force in 2009 that coordinated the federal bailout of two of Michigan’s automakers, Lena Epstein was working to keep her family’s auto supplier business from going under during the Great Recession. The two women from Oakland County were both in their 20s at the time, finding their career footings during a consequential period of economic upheaval that was an existential threat to the survival of not just General Motors Corp. and Chrysler Group LLC, but hundreds of companies in the auto sector’s supply chain, including Epstein’s family business, Vesco Oil Corp. Nearly a decade later, Stevens and Epstein’s career paths are crossing again — this time on the campaign trail, where they are running against each other to be the next member of Congress from Michigan’s 11th District, representing some of suburban Detroit’s most affluent communities in central Oakland and western Wayne counties. Their race to replace retiring U.S.

Congratulations to the 2018 class of Crain’s

UNDER

FORTY

We appreciate your spirit of innovation and community engagement. We share these values at the College of Business and invite you to partner with us: • Work with our Center for Innovation Research, iLabs • Participate in a professional development program • Sponsor a student project or speak in a class

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Rep. Dave Trott, R-Birmingham, is expected to be one of the most competitive congressional races in the country this fall as Stevens, a Democrat, tries to capture a seat that has long been held by Republicans. The contest also is unique in that it’s a head-to-head matchup between two women in their 30s campaigning for the first time for elected office in an election year when suburban female voters could decide which political party controls everything from Congress to the governor’s office and Legislature next year. And both Epstein and Stevens are emphasizing their understanding of the auto industry and the private sector in their campaigns after emerging victorious last month in crowded Republican and Democratic primaries, respectively. Stevens, 35, worked in the policy shop of Barack Obama’s presidential campaign before becoming chief of staff to “car czar” Steve Rattner, who led Obama’s auto bailout task force, which orchestrated the financial rescues and pre-packaged bankruptcies of GM and Chrysler. She later shifted into a position at the U.S. Commerce Department working on the Obama administration’s advanced manufacturing and economic growth initiatives. Stevens then spent two years as a fellow for Bloomberg Philanthropies based in Louisville, Ky., helping stand up an export assistance program for small manufacturing companies before going to work for UI LABS, a digital manufacturing and design institute based in Chicago. “I have inarguably one of the most profound backgrounds in manufacturing of anyone running for Congress in the country — and specifically for what we do and who we are as a region," said Stevens, who has

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Lena Epstein, 37 “The auto bailout was not done by one person alone. It was done because, once again, we as a business community of Southeast Michigan, we came together, and there was a masterful, masterful plan put together by so many tremendous leaders, it’s too long of a list.”

made strengthening Southeast Michigan’s position in the national economy a core part of her campaign. Epstein, 37, has worked in the family company her grandfather founded in 1947 since age 16, running the marketing department in 2008 for the automotive and industrial lubricants business when the recession began to hamper auto suppliers and OEMs. Vesco Oil’s customers were closing plants, laying off employees and cutting production shifts, Epstein said. Epstein, who is a co-owner of Vesco Oil, acknowledged the family-run business weathered the recession, in part, because the auto suppliers of GM and Chrysler did not go under. “We survived,” Epstein said. “Not only did Vesco survive, but we thrived.” But the Republican businesswoman credits the metro Detroit business community, not the Democratic

president, for saving the state’s auto industry. “The auto bailout was not done by one person alone,” Epstein said. “It was done because, once again, we as a business community of Southeast Michigan, we came together, and there was a masterful, masterful plan put together by so many tremendous leaders, it’s too long of a list.” Stevens, who has made the auto bailout one of her main talking points in the campaign, said the effect of the federal government’s intervention to prevent GM and Chrysler from liquidating can’t understated. “If GM and Chrysler had liquidated, it would have shattered the entire supply chain,” Stevens said. “It would have been catastrophic to our regional economy and I don’t think we would have the Michigan that we have today … in terms of the prosperity.” — Chad Livengood PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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CRAIN’S 40 UNDER 40 “People feel the energy and momentum of the comeback of the city and they want to be a part of that, and that’s a powerful force.”

Anthony LaVerde, 39 CEO, Emagine Entertainment Inc. “We don’t have any plans to stop expanding. There is no state we won’t go to, and we look forward to becoming a national chain.”

he genesis of Detroit’s newest first-run movie theater came in October when Anthony LaVerde was contacted by a regular Emagine Entertainment Inc. patron. Granted, it was a well-connected one: Rapper Big Sean’s mother. “We developed a relationship,” LaVerde, the 39-year-old CEO of the Troy-based movie theater chain, said. “And over the course of 4-5 months, built a vision of what Sean is looking to do. Then Paul (Glantz, Emagine chairman) and I flew out to L.A. to meet with Sean and started to put pen to paper and crunching numbers.” The result is anticipated to be a $20 million project to build the Detroit’s first new movie theater in years, complete with what LaVerde described as the largest flat movie theater screen in the world, coming in at about 120

Seth Herkowitz, 37 COO/Partner, Hunter Pasteur Homes

f he wanted to, Seth Herkowitz could take credit for many of the good things happening at Detroit area builder-developers Hunter Pasteur Homes — though he’s quick to add he works under the mentorship of his two partners, CEO Randy Wertheimer and partner Howard Gitler. “In my role with the firm I am responsible for strategic oversight of our people, our processes, our branding, our R&D initiatives and general development design activities across our entire portfolio of communities,” said Herkowitz. But he’s proudest of the role he plays in the City Modern project in historic Brush Park, where Hunter Pasteur is overseeing the sales, development and construction of the project’s 104 condos, a $45 million project. “There’s obviously been a tremendous amount of momentum in Detroit over the last five years,” said Herkowitz. “Driven in large part by Dan Gilbert and the Bedrock team’s vision and leadership, conditions now exist where demand for new construction

‘for sale’ housing outpaces supply. Such conditions have provided an excellent opportunity for Hunter Pasteur Homes.” From 2016 to 2017, the company saw a 50 percent increase in units sold. And they’ve sold 78 units at City Modern since February 2017. “People feel the energy and momentum of the comeback of the city and they want to be a part of that, and that’s a powerful force,” said Herkowitz. “They want to be part of those revitalization efforts and that’s played a major role in the success we’ve had.” Another point of personal pride for Herkowitz is his service on the alumni board of directors at Chicago-Kent College of Law and as a Beaumont Health trustee, where he co-led the effort to raise over $2.3 million to create the Harry N. Herkowitz Distinguished Chair in Orthopedics. This endowment benefits a variety of health initiatives in honor of his late physician/surgeon father, who served for many years as chairman of orthopedics at Beaumont. — Eric Harabadian

“ c o o t

Alison Orlans, 39 President and CEO, Orlans PC, eTitle, eVantage “We’re bringing lean processes and technology to the law by rethinking traditional business models and focusing on the client experience.”

feet wide and more than 65 feet tall. Large enough to fit a 737 jumbo jet, he said. While a final location for the theater, which would have 10 to 12 screens total and also include a music venue that could host events such as lectures, seminars and comedy shows, has yet to be determined, the list is down to two locations that LaVerde would not disclose. It is expected to be revealed by the end of the year. However, Crain’s reported in June that one of the sites being considered is the Michigan Central Station, which was purchased by Ford Motor Co. in May to serve as the anchor for the Dearborn-based automaker’s campus for 5,000 autonomous and electric vehicle technology workers in the Corktown neighborhood west of downtown. That $740 million proj-

ect is slated to begin later this year and take several years to complete. Regardless of where the theater ends up, however, it would have about 600 reclining seats and space for another 400 or so nonpermanent seats, for a total auditorium capacity of about 1,000, LaVerde said. For comparison, the $80 million company’s Super EMAX auditorium in Novi seats about 350, while a typical Emagine auditorium seats 90100, LaVerde said. Emagine has 10 theaters in Michigan, eight in Minnesota, and one each in Wisconsin and Illinois, with continued growth on the horizon. “We don’t have any plans to stop expanding,” LaVerde said. “There is no state we won’t go to, and we look forward to becoming a national chain.” — Kirk Pinho

oining a family business is not that unusual. But when a daughter joins her mother’s business — well, that’s a little less usual. Alison Orlans, president and CEO of Orlans PC, eTitle and eVantage, has a passion for bringing innovation to the legal profession. That desire to make a difference for her employees, community and clients came at an early age. Orlans’ mother and founder of the company, Linda, raised Orlans as a single parent while putting herself through law school at night. “I could sense her devotion,” Orlans said. “I often went to work with her on the weekends and I could tell there was important work going on; it inspired me. Watching my mother deeply impacted my calling. I always wanted to be a lawyer and carry on her vision.” After a multi-million dollar merger of three law firms in 2017, Orlans PC is now one of the largest certified women-owned law firms in the country. “I took it from an entrepreneurial company to stage two,” said Alison Orlans, who led the merger. “I helped us grow in a sustainable way.” Orlans took the company from red to black, saving more than $4 million and increasing profits by more than 10 percent. In addition, she reduced turnover by 10 percent and increased employee engagement scores in every category. Moving forward, Orlans’ goal is to change the way law is practiced. “Every other industry has gotten more technology focused, so too should the law,” Orlans said. “We’re bringing lean processes and technology to the law by rethinking traditional business models and focusing on the client experience. The law field is ripe for this transformation.” — Laura Cassar

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“We always say our noble silence is conversation. Part of the spirituality of our studio is decreasing your fear of otherness and learning how to say hello to other people around you.”

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Kacee Must, 34 Owner, Citizen Yoga

acee Must believes that Citizen Yoga’s mission of suicide prevention and community building is desperately needed — not just here in metro Detroit, but across the country. That’s why the first element of the company’s vision statement is to become a national enterprise. Must, Citizen’s owner and founder, will make that leap in October when she adds a Cleveland studio to a list of locations that also includes Royal Oak, Bloomfield Township and Detroit. At the core of Citizen Yoga is creating community, which Must believes is revolutionary in the yoga world. Students are encouraged to put down their phones and talk to each other — not walk in, work out and leave. “We always say our noble silence is conversation. Part of the spirituality of our studio is decreasing your fear of otherness and learning how to say hello to other people around you.” And the Citizen Yoga community keeps growing. All three locations have achieved 30 percent growth in

profit and revenue year over year. More than 2,700 students per week attend 137 classes taught and run by a team of 50. Must lived in India studying philosophy before she opened her first studio in 2013. Her work continues to be inspired by Miya Must, her older sister who took her own life in 2007, “honoring her memory by providing a space for people to feel included, welcomed and belong.” Early on, Must was mentored by her uncle Robert Jacobs, the founder and owner of Buddy’s Pizza. His experience building a business without franchises — coupled with a steady, 30-year yoga practice — positioned him to challenge Must’s business acumen and strategy at every phase of growth. As a result, Must developed systems that are replicable. Ones that can ultimately translate into success wherever a Citizen opens. Next stop: Cleveland. — Melinda Clynes PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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Congratulations Lena Epstein

2018 Crain’s Detroit Business 40 Under 40 Honoree Congratulations on this well-deserved recognition. May you continue to reach new levels of success.

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CRAIN’S 40 UNDER 40

Khalil Rahal, 37

Chris McCuiston, 38 CEO & Co-Founder, Goldfish Swim School Franchising LLC

t might surprise you to know that the CEO and co-founder of Goldfish Swim School is a self-described “land mammal.” But his preference for terra firma hasn’t stopped Chris McCuiston from growing his aquatic-based business from a single location with 510 students and 25 employees to an 80+ franchise network that teaches more than 90,000 students per week and employs roughly 1,800 staff members. McCuiston and his wife and fellow founder, Jenny, started with much smaller goals. Jenny, a life-long swimmer, grew up in cold, sterile pools. She wanted to offer something different. After using vacation days to travel the country to research swim schools, they made the leap — or dive — to open their dream with their Birmingham location in 2006. “Our original intention was four locations, but everyone would ask if we were a franchise. After two years of success, we decided to investigate that,” McCuiston said. As the business has grown, McCuiston said the biggest challenge is delivering a consistent product. “We are dealing with humans — of different ages, genders and experi-

“We are dealing with humans — of different ages, genders and experiences — but consistency in our service is key.”

ences — but consistency in our service is key.” McCuiston’s goal is to have 260 locations by 2024. The swimmers may vary, but the school’s goal is always the same: making sure their swimmers know water safety and have a fun and loving relationship with the water.

Jeanette Pierce, 37

Founder and Executive Director, Detroit Experience Factory

Assistant County Executive, Wayne County

s lifelong Detroit resident Jeanette Pierce readies to stop leading her 12-year-old nonprofit, the past is present. The 37-year-old’s Detroit Experience Factory sends locals and visitors out on guided missions to learn the city’s good and bad truths. As its goals change, Pierce is leaving her executive director role this fall to start a new sister initiative called City Institute, doling out lessons learned to other urban storytellers. She’ll remain a DXF adviser. Pierce left her day job in 2008 to run her tour and resource provider full time, without experience as an entrepreneur. It’s led 110,000 on tours and grown to a budget of $750,000. “She laid a foundation, and also did a lot of the hard and dirty work people didn’t want to do,” said friend and colleague Marlowe Stoudamire. “She was the real first tourism attraction for the Detroit rebirth.” A big part of Pierce’s job was walking around the city and living in it — collecting experiential data to share. She strolls past a long-closed door downtown that’s now open, spewing dust, and learns a new restaurant is coming. Her apartment at the Hemmeter Building in Harmonie Park was once burglarized; someone busted an 18- by 24-inch hole in her drywall and stole a Gatorade bottle full of change. “What really stood out at the beginning that’s still important now is the word ‘I,’” Pierce said. “I live here. I’ve always lived here ... It was super powerful that (it) was my personal experience.” Reflection is part of the gig. Detroit’s more positive dialogue is pervasive now, and that means pivoting DXF toward lesser-known neighborhood stories. But misinformation rages on. “... What’s newer is that there are people ... that think that Detroit is perfect,” she said. “What we’ve always focused on is that full story, the good and the bad, the old and the new, and now that’s even more necessary than ever. If you don’t understand the challenges of the city or the people who have stayed throughout everything, then it’s just as detrimental as thinking everything’s awful.” — Annalise Frank

“Learning to swim is a serious thing,” McCuiston said of the school’s focus on drowning awareness. “We are saving lives.” With a finance background, McCuiston said a business degree has helped with running the swim school but it’s being in an environment of

“What we’ve always focused on is that full story, the good and the bad, the old and the new, and now that’s even more necessary than ever.”

people that he loves. “We’re building a legacy we can be proud of. We create jobs and careers from something people love, change lifestyles and save lives. I wake up feeling good knowing I’m adding value to my community.” — Laura Cassar

A few months after Khalil Rahal joined Wayne County Executive Warren Evans’ administration in 2015, Evans asked him to assess the county’s economic development department. Wayne County’s Economic Development Growth Engine, or EDGE, department was the brainchild of the previous administration and was seen as a poor-performing program that the cash-strapped county could no longer afford. “I told him he should just eliminate the department altogether,” Rahal said. Rahal recommended a new mission for economic development for Wayne County — one focused on offloading costly real estate assets, creating more development-ready sites and tackling issues that affect the region’s competitiveness, such as transit, talent readiness and the high cost of auto insurance. “And then he said, ‘Well, good, be-

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ri Maddipati, treasurer and vice president of investor relations at CMS Energy in Ann Arbor, is on the road four to eight days each month meeting with investors and other stakeholders who want to know how the utility with $6.6 billion in annual revenue is doing. Maddipati, a Michigan native, came to Consumers in 2014 after two

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“Part of our recovery plan, financially, was to sell off excess assets, get them back on the tax rolls, create jobs, create investments, squeeze as much juice out of them as possible.” cause I want you to run it,’” Rahal recalled Evans saying. “And I remember thinking to myself, ‘OK, if I knew you were going to say that, then I wouldn’t have told you to get rid of the department.’” That’s how Rahal found himself running a one-man economic devel-

opment department for Michigan’s largest county and the 19th largest county in the country. Rahal, 37, is now an assistant county executive under Evans with a focus on repurposing underused or vacant county-owned properties and taking on structural issues that affect

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years as a vice president at Goldman Sachs. He supervises 14 employees in a department with a $425 million budget. “We are in the process of upgrading a lot of aging infrastructure ($10 billion). Much of the natural gas system was built 50 to 60 years ago and lots of capital is needed. I go around the country telling people why CMS

is a great investment,” he said. Maddipati said the reaction he gets from owners and investors is “generally very positive. We have a long track record of executing our plans and doing it well. Investors trust us fairly well. But there is a big leap here because we are replacing assets. Not new but different,” because of the company’s goal to provide electricity

metro Detroit’s economic competitiveness. Under Rahal’s direction, the county secured a deal to sell the former Standard Accident Insurance Co. building at 640 Temple St. for $11 million to a development group that plans a $65 million makeover for the building, including a new boutique hotel. Rahal was the pointman for Wayne County in securing a deal with the Moroun family’s Crowne Enterprises to buy the polluted former McLouth Steel Products Corp. steel plant in Trenton. Crowne and the U.S. Environmental Protection Agency have a deal in place for a Superfund cleanup at the 180-acre steel plant site as well as an adjacent 70-acre property the Morouns own in Riverview. In June, Wayne County inked a deal Rahal helped engineer with Southfield-based Morgan Development to sell the long-abandoned Eloise Hospital Complex in Westland for $1. The agreement stipulated that the developer has to invest $20 million in revitalizing the one-time psychiatric asylum, which Wayne County had owned since the late 1800s. Maintenance and security at the Eloise complex was at least $500,000 annually for a vacant and blighted property that was a destination for urban explorers, Rahal said. “Part of our recovery plan, financially, was to sell off excess assets, get them back on the tax rolls, create jobs, create investments, squeeze as much juice out of them as possible,” Rahal said. — Chad Livengood

to customers with more than 40 percent renewable energy. Maddipati is motivated by Consumers’ “triple bottom line” goal: People, planet and prosperity. He said Consumers is the first U.S. company to “marry financing to our sustainability goals.” Maddipati said if Consumers generates electricity above its renewable energy goals, banks will lower borrowing rates on capital financing costs. “It is baked into the credit agreement with the banks. We are the first company to do it in June. It will start next year.” His team has improved credit ratings at Fitch Investors and Moody’s Investor Services, Maddipati said. “We got two upgrades, both up one notch. We did it by prudent financial management,” he said. Improved credit ratings has saved Consumers $12 million in annual interest payments. Looking ahead, Maddipati said he is improving information technology systems to further automate cash management, vendor payments, customer collections and overall financial operations. Besides his job, Maddipati said he is a “huge UM football and basketball” fan. From the University of Michigan, he has a bachelor’s and master’s in engineering, focusing on computers and electrical systems, and also an MBA. Maddipati said he also spends much of his non-work time with his family, which includes two young daughters. He also is on two investment and finance boards, supporting community nonprofit agencies and education. — Jay Greene

“My role is to help the banks lend in the community. That’s what I’m interested in: creating home ownership opportunities for low- to moderateincome families and people of color.”

Krysta Pate, 38

Programs Director, Community Reinvestment Fund USA

t was her dream to be a forensic pathologist. But Krysta Pate was awakened when she abandoned a biology scholarship at Michigan State and returned home for a job in banking. There the Detroit native found her calling to help low-income Detroiters buy real estate. “A lady withdrew change, literally less than a dollar,” she recalled. “I come from an affluent neighborhood. I never had seen poverty up close and personal.” After nearly a decade as a mortgage officer, Pate served a stint at the Detroit Land Bank and earned a degree in public administration and community development from Central Michigan. Now she is program director of Detroit Home Mortgage through Community Reinvestment Fund USA. She manages a $40 million joint fund with five banks and collaborates with 11 housing counseling agencies to help turn renters into homeowners. “My role is to help the banks lend in the community. That’s what I’m

interested in: creating home ownership opportunities for low- to moderate-income families and people of color,” Pate said. Hampered by vacant properties, home appraisals in Detroit have created a disadvantage for buyers low on cash who are less likely to win a bid. “Most people of color don’t have cash available. There would be an appraisal gap even if their credit is fine,” she said. “DHM fills the gap between the asking price and the low appraisal.” For Pate, it’s about helping renters become homeowners and build generational wealth. “I saw how easy it is to buy a house. You pay less than you pay in rent,” she said. “Once you have experience with the people, you understand that financial literacy is very important.” Detroit mortgages increased from about 498 in 2015 to nearly 1,000 last year. Currently, DHM accounts for 10 percent of mortgages in Detroit, Pate said. — Tyler Clifford PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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CRAIN’S 40 UNDER 40

Linzie Venegas, 38

“Sometimes you’ve just got to go into the unknown, rely on your gut and your decision-making skills.”

Vice President, Ideal Group

“It is extremely important when you have an opportunity to create generational wealth.”

Executive Director, CultureSource

inzie Venegas’ biggest challenge — and major accomplishment — came last year when her father Frank was hospitalized and sidelined after a serious accident. She has worked with him all her life at Ideal Group, a $350 million construction and steel manufacturing company he founded just weeks before she was born. And she spoke to him about business every day. She and younger brother Jesse had to step in to take more responsibilities. Guided by advisers and mentors, the two managed negotiations to buy out a stake in the company from Barton Malow. “We had one person down — but still the business has to go on. That continuously gave me strength,” she said. “Sometimes you’ve just got to go into the unknown, rely on your gut and your decision-making skills.” As a child, Venegas came to Ideal Group with her dad. “I would get a nickel for each mailer I would do,” she recalled, and her father told her

Omari Rush, 37

if she did a good job, she could move up. Today, she is vice president, overseeing finance, human resources and marketing. Leaders of two of the group’s firms report to her. She enjoys seeing young people from Cristo Rey High School and several uni-

versities working. “Interns are a very big part of our recruitment process here,” she said. She also teaches digital marketing at Dartmouth and coaches small business owners through a Google-Dartmouth program. She’s proud of the family culture

and community engagement her father instilled at Ideal. Her goals include to “keep this business running and create good lives for people,” she said. That also involves philanthropy focused on Southwest Detroit: “Giving back is really important.” — Vickie Elmer

Joni Thrower Davis, 39

CEO, Jamjomar III, LLC

oni Thrower Davis comes from a family of CEOs. While she shares that title with each of her parents and three siblings, her resume sets her apart in Jamjomar Inc. The second-eldest of four children, Thrower Davis always knew she would join the family group, whose portfolio now spans 30 McDonald’s restaurants in Michigan and Louisiana. In 1989, her parents, Jim and Marla, sought to build a path of prosperity by opening their first restaurant on Mack Avenue and I-75 in Detroit. It was an inspiration for Thrower Davis. “It is extremely important when you have an opportunity to create generational wealth,” she said. “It’s something that is not as predominant in the African American community.” Before the food business, Thrower Davis earned her chops in the legal field. She practiced banking and finance law for nearly a decade and served as diversity director at Miller, Canfield, Paddock and Stone. “I stayed there longer than I intended. I enjoyed the firm, the work

and the legal side of the world,” she said. “That allowed me to provide another benefit to the family business.” As general manager of the high-volume McDonald’s at Detroit Metro Airport, Thrower Davis increased sales and customer satisfaction, decreased employee turnover and completed a total renovation two weeks early — all while keeping all of the restaurant’s workers employed. It earned her a prestigious Global Ray Kroc Award in 2016, which recognizes the chain’s top GMs worldwide. Now Thrower Davis owns four McDonald’s restaurants and employs 165 people in metro Detroit. She collected about $7 million in revenue last year, but the restaurateur looks to ring more receipts once 16 months of restaurant renovations are complete. Although she was the last of her siblings to own her own golden arches, she says she is a mix of them all. “I feel like my super power is that I’ve taken a little bit from each of them to really create what I think is a great business owner.” — Tyler Clifford

s the executive director of CultureSource, Omari Rush is helping local arts and cultural groups cement their relevance, reflect their communities and engage more patrons. The role is a natural extension of the ingrained organizer traits he learned from his parents and through years of community engagement experience in the arts and cultural sector. After an eight-year stint with University Musical Society, Rush, took a position with the venerable Ann Arbor Arts Center. During his three years there, he continued to engage the community in art and took art into the community, organizing projects such as an exhibition of Washtenaw Community College photography students’ works on Ann Arbor Transportation Authority buses. He also organized the contemporary art festival “Pop-X” in downtown Ann Arbor for two years, engaging 10 artists to create site-specific installations and planning programming to

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animate the spaces. The festival attracted thousands. Rush is bringing that same community engagement sensibility to CultureSource. “No longer can we expect people will just come to their theater,” said Rush, who has been in the role for a year. “It’s about taking programs out into the community and also about giving up a little control,” not doing just what the group wants but what the community wants to experience. Under his direction, the nonprofit arts and cultural group association is helping members reinvent the ways they promote themselves, teaching them to use digital and social media to build awareness and engage their communities by responding to the modern-day equivalent of the art review on platforms like Yelp.com. Operating on a $776,000 budget, Rush and a staff of five are also forging content development and distribution partnerships with local media and looking at collaboration with groups like Travel Michigan and Pure Michigan. Word of the efforts he’s leading is getting around. With no active recruitment effort underway, membership in CultureSource grew to 142 organizations over the past year, up from 111 in 2017, said Rush, who was appointed by Gov. Rick Snyder to chair the state arts funding group, Michigan Council for Arts and Cultural Affairs, in January. — Sherri Welch

Tamira Chapman, 39

Attorney, Ford Motor Co.

hen the Patient Protection and Affordable Care Act, better known as Obamacare, was signed into law in 2010, employers like Ford Motor Co., which has nearly 100,000 U.S. employees, were unprepared for the impending change. It turned to its human resources talent as well as in-house counsel. Tamira Chapman joined Ford in 2011 with one goal — to lead the automaker to a successful implementation of its changing health care plans. For Ford’s 30,000 salaried workers, implementation was simple. But with the automaker’s 70,000 hourly workers, most of which are covered under labor agreements with the UAW, Chapman had her hands full. “It meant tremendously long hours and conversations with legislators and our human resources teams to bring the health care changes on time and on budget,” Chapman said. Since she’s been at Ford, Chapman has successfully negotiated $1.6 billion related to benefits and health care and reduced the company’s benefits litigation by 40 percent. She’s now Ford’s lead attorney for labor and UAW negotiations, expanding her scope beyond only healthcare. Though she loves her time prac-

ticing law at a company she reveres like Ford, she’s also passionate about helping nonprofits sustainably fundraise. In 2015, Chapman co-founded Storehouse in a Box LLC. The business is a white box solution offering gift box subscription services to nonprofits and charities. Supporters can subscribe to branded boxes filled with gifts and swag that also support a social mission. “Nonprofits recognize there’s only so many ways they can ask people to write a $20 check,” Chapman said. “Instead, we can put a product in front of them with messaging. A product they want to spend their money on that’s creating a new revenue stream.” Storehouse remains in the background fulfilling orders and running the websites for the nonprofits while collecting a portion of the revenue from its services. One nonprofit raised roughly $500,000 in 12 months by offering Storehouse’s gift box services, Chapman said. “It’s a multimillion dollar company right now, and it’s claiming more and more of my time,” Chapman said. “I love law, but this gives me an opportunity to say that I care and to actually roll up my sleeves and get involved (philanthropically).” — Dustin Walsh

“We are elevating primary care coordination with specialist treatment because with longer frequency appointments, roughly six to eight weeks out, we see higher no-show rates.”

Jacqlyn Smith, 33 Chief Strategy Officer, DMC Children’s Hospital of Michigan

pening doors for pediatric patients, families and doctors to DMC Children’s Hospital of Michigan is what Jacqlyn Smith, the hospital’s chief strategy officer, does every day with her 14-member team. Smith, 33, who works closely with Detroit Medical Center’s managers in physician relations and marketing to coordinate programs, said her primary job is to improve the services Children’s provides through pediatric specialty care as well as access to that care. Five years ago, Smith moved to Detroit to work at Children’s as part of an administrative fellowship program from Boston University, where she was earning a master of public health degree in health policy and management. Since she was promoted to chief strategy officer in 2017, Smith has led the development of two projects to improve communication with patients and doctors. Earlier this year, Children’s launched the “Rapid Access” program, which includes a daily email sent to doctors on DMC’s medical staffs that shows availability for nextday medical specialty clinic appointments. “We have more than 40 specialties and more than 200 physician offices (and five major ambulatory locations),” Smith said. “People want to get in. (The program) provides easy access to clinics at Children’s.” Smith said that Rapid Access has improved appointment access for patients, but it also has improved relationships between physician offic-

es and the hospital. In June 2017, Children’s began a concierge service for patients discharged from the emergency department that has improved compliance for follow-up appointments by about 20 percent in the first year. Now, between half to 70 percent of ER patients who need a follow-up appointment are seen, Smith said. “I would love to think this results in fewer revisits or readmissions. Managing care in outpatient settings is what we want to do,” she said. Her newest project will kick off in September, when Children’s Hospital plans to launch a statewide telemedicine project to connect primary care doctors and pediatricians with pediatric neurologists for patient consultations. The service, which is billable with most health insurance plans, is intended to allow patients and families to receive pediatric specialty care closer to home and lessen time and travel problems. “We are elevating primary care coordination with specialist treatment because with longer frequency appointments, roughly six to eight weeks out, we see higher no-show rates,” Smith said. “We aim to reduce our no-show rate and improve compliance.” Over time, Children’s hopes to add other specialties to the telemedicine consultation program, including neonatal care for hospitals with nurseries across the state and school clinics with diabetes and asthma management, Smith said. — Jay Greene PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

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CRAIN’S 40 UNDER 40

Joseph Vernon, 38

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Principal, Resident Director, Miller Canfield

wice in his life Joseph Vernon has said, “Let’s give it a shot.” That willingness to take a chance is how Vernon went from a Canadian business major and football player to resident director of the Detroit office of Miller Canfield — the oldest and one of the largest law firms in Michigan. The first time Vernon uttered those life-changing words was as a fourthyear business student in Toronto. He was still trying to select an area of focus when a professor asked Vernon if he had ever thought of law school. “Honestly, I never had,” Vernon said. “I liked law shows and movies but I didn’t know any lawyers.” The professor was impressed with Vernon’s unique ability to reach people during classroom presentations. That push, and the fact that Vernon still had football eligibility left, inspired Vernon to say, “Let’s give it a shot.” Vernon went on to get a dual law degree from the University of Windsor and University of Detroit Mercy School of Law. He also continued to play football. “Playing football, you spend countless hours getting ready, studying the opposing team. Much like court, most of the work is done before the game,” Vernon said. “Meticulous preparation — it’s exactly what we have to do as lawyers. I honed my skills on the football field. It’s a big part of who I am.”

“Meticulous preparation — it’s exactly what we have to do as lawyers. I honed my skills on the football field. It’s a big part of who I am.” Vernon had every intention of returning to Toronto to practice law until he met some Miller Canfield people at a networking event. Impressed by the firm’s willingness to give young lawyers opportunities for high-level work, with support and mentorship, Vernon found himself thinking those same words and gave Miller Canfield, and Detroit, a shot. “Life happens,” Vernon said. “I fell in love with the firm, the experiences and the city.” Now as a senior principal at Miller Canfield, Vernon is in a unique position to help people, and that’s what

Donovan White, 39

Vice President of Construction, White Cons

F matters the most. “When people ask you to be their voice in court, it is an honor,” Vernon said. “I work hard for people; they put their trust and faith in me and I appreciate that.” Vernon was recently appointed resident director of Miller Canfield's headquarters office in Detroit, where he oversees a team of 159 attorneys and staff. “I know that the teams that do the best are the ones that gel,” Vernon said. “Miller Canfield’s best and only assets are our people.” — Laura Cassar

“I very much look forward to the lasting legacy that the Shinola Hotel will leave upon this city.”

or Donovan White, it’s pretty simple. “Construction is my life.” White has been part of the family business, White Construction, since 1997, making a drive around Detroit more like a trip down Memory Lane. “Ford Field, Little Caesars Arena, Comerica Park, Detroit RiverWalk, Campus Martius — yes, I was on those projects,” said Donovan, now vice president of construction at White. “The history of Detroit is linked to my history.” The latest and greatest of those projects was Little Caesars Arena — one of the largest projects White has personally ever been on. Construction costs rang in at about $863 million when all was said and done. White Construc-

tion was one of three firms, along with Southfield-based Barton Malow and Indianapolis-based Hunt Construction Co., that formed the team that served as general contractor on the massive project. “You’d look around at the amount of people working and think, ‘Maybe we can make magic happen,’” White said. “We just kept our heads down and kept putting the work in place.” The late announcement that the Detroit Pistons would also play in the new arena nearly doubled the scope and value of the project. “However, the end date for turnover remained the same,” said White, who finds satisfaction in coming up with solutions and exceeding expectations.

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Andrew Leber, 38 Vice President of Hospitality, Bedrock

fter six years traveling to Detroit from Boston as a consultant for Bedrock, Andrew Leber knew the immense potential of Detroit’s hospitality market. When he had the chance to take a job with Bedrock, the opportunity to be part of realizing that potential was too good to pass up. Still, there was a specific moment when Leber knew he had made the right decision in moving to Detroit to work on the Shinola Hotel project. A quote by Maya Angelou is Leber’s touchstone: “People will forget what you said, people will forget

what you did, but people will never forget how you made them feel.” When Leber walked into the office of Shinola’s creative director Daniel Caudill for their first meeting on the project, the same quote was posted above Caudill’s desk. That synergistic connection will culminate in a unique hotel experience that Leber — who’s overseeing every single detail, from construction to fixtures — is eager to reveal this December. “The site will unite retail, food and beverage, and hospitality under one roof — truly a destination experience that can be enjoyed by all,”

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C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

“We did a great deal of planning in a short time to satisfy all the requirements for the NHL, NBA and NCAA. It was an awesome feat, and I’m quite proud to have been part of it.”

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“We did a great deal of planning in a short time to satisfy all the requirements for the NHL, NBA and NCAA. It was an awesome feat, and I’m quite proud to have been part of it.” White’s current goals are to strengthen and grow the business with plans to double revenues within five years. Working for the family business, “job hopping” is not an option for White, but creating a productive and challenging work culture is. “We model a company where people want to come to work,” White said. “We offer work/life balance and the satisfaction of supporting our community. We keep morale high to attract and retain staff.” — Laura Cassar

Leber said. “I very much look forward to the lasting legacy that the Shinola Hotel will leave upon this city.” Every part of the 130-room development strives for a tie to Detroit, from the products in guest rooms to the food-and-beverage services provided by NoHo Hospitality, with a partner/founder, Josh Pickard, from Detroit. Another aspect that Leber is thrilled to reveal is an indoor/outdoor conservatory with incredible landscaping. “There’s a lot of excitement to bring a great hospitality and culinary experience,” Leber said. “It’s something every city should have and something we will deliver — a destination that will astound every traveler.” — Laura Cassar PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S

Vijay Virupannavar, 34

FP&A, Olympia Entertainment

hile it wasn’t as visible as the steel and concrete, Vijay Virupannavar played a critical role in the launch of Detroit’s Little Caesars Arena. Someone had to create all of the financial tracking and reporting for operations at the $500 million building. That someone was Virupannavar, and he did it from scratch. Making it even more complicated was the concurrent creation of 313 Presents, the joint venture between his employer, Olympia Entertainment, and rival Palace Sports & Entertainment, to manage concerts and events at the new venue. The downtown Detroit arena opened in September 2017 as home of Olympia’s Detroit Red Wings and PS&E’s Detroit Pistons, and as a world-class entertainment venue. Virupannavar, 34, was hired in 2016 to craft the financial systems for arena operations, and was functionally given free reign by Olympia Vice President of Finance Keith Dowdican. There wasn’t really a template to work with because arena launches are rare, and two competing entertainment companies working jointly

is unheard of. “Blending everything took months, to start figuring out how to combine their needs with our needs, what they have with what we have,” Virupannavar said. “It’s been a hands-on learning experience.” The arrangement means he has lots of bosses and there are many different types of reports for the two ownership groups. “There are two different systems, two ownership groups, two different sets of everything,” he said. He also does ad hoc financial analysis for Olympia. He also runs a nonprofit called Let’s Go Detroit aimed at helping Detroit via networking events and donation drives for diapers, clothing and turkeys at Thanksgiving. “The most important thing I do is my nonprofit; it’s focused on the neighborhoods and people of Detroit,” he said. Virupannavar also owns several properties that he’s rehabbed in the city. Oh, and he plans to run for mayor of Detroit in 2024. Why? Because politics are an effective way to amplify

“The most important thing I do is my nonprofit; it’s focused on the neighborhoods and people of Detroit.” your efforts to help people, he said, but lobbying elected officials for change can be an ineffective slog, so it’s more effective to become one.

“You’ve got to schmooze ’em,” he said. “Why do that if you can be the politician?” — Bill Shea

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PONTIAC FROM PAGE 3

“One was a donation and one was an acceptance into the program,” Sharma said in his deposition. “They’re completely separate.” Several medical education experts told Crain’s they have never heard of a documented case where a hospital charged a medical school graduate a fee to enter a residency program. While not technically illegal, paying fees for residency slots violates many professional medical standards. To become selected as a resident, student doctors apply early each year through what is called the “Match,” which is governed by the National Residency Matching Program. Graduates are selected in March and typically start their residency in June. Not in dispute is that Chopra was approved for residency by Pontiac General in September after his parents paid $400,000 and was to have started his residency on Nov. 1, 2016, after he secured a J-1 visa and a medical license from the state of Michigan. Pontiac General spokesman Michael Layne, president of Marx Layne & Co., declined comment on the Chopra suit. In the lawsuit filed in 2017 in U.S. District Court in Detroit, the Chopras claim they were instructed to pay the $400,000 to secure the residency position for their son, who had graduated in 2009 from American University of Antigua but was unsuccessful in matching in a U.S. or Canadian hospital residency

program for the next seven years. Andrew Broder, the attorney for the Chopras with Payne Broder & Fossee P.C. of Bingham Farms, said the case has many unusual aspects and has been difficult to pursue because the Sharmas have been uncooperative, leading District Judge Robert Cleland to cite them for contempt of court. In his deposition, Sanyam Sharma acknowledged Chopra was admitted to a monthlong residency observership program in October before his residency would have begun. Chopra participated in the program in Pontiac from Oct. 3-26. He leased an apartment in a building the hospital owns. But at this point, different stories emerge about what happened next. Sanyam Sharma said Chopra voluntarily “left” the program. Satish Chopra said Priyam Chopra, Sanyam’s mother and hospital COO, called Poonam Chopra on Oct. 26 to say Varun “was summarily dismissed from the residency program,” court documents say. “(Varun) was advised he would not be able to start the residency program” and must leave the country because his J-1 visa sponsorship was being revoked, said Broder. Chopra tried for several days to get residency and hospital officials, including Carol Samson, residency manager, and Nikhil Hemady, M.D., the hospital’s program director and chief of staff, to explain why he was being asked to leave. Court documents state he was unsuccessful. On Nov. 2, he left for home in Brampton. Samson, who has been residency

program manager for 20 years, said in a deposition that Hemady told her that Chopra would not begin the program as planned. She said Chopra asked her why and she told him she wasn’t told and didn’t know why. Shortly after, she informed the Educational Commission for Foreign Medical Graduates, which sponsored Chopra’s visa, that Chopra would not be entering the program. “Nothing like this has ever happened,” she said in her deposition. As the lawsuit continues past its 18th month, Cleland reached a major conclusion early on, in June 2017, about key facts of the case. “It is further ordered as a sanction, and deemed established without further proof, that the donated funds in the amount of $400,000 were in fact an entry fee, and a mandatory component of the terms of the residency agreement, operating as a condition precedent to plaintiff Varun Chopra’s entry into defendants’ residency program.” In denying a summary judgment request from the Chopras and Sharmas in March, Cleland said what still is in dispute is whether Chopra actually “entered” the residency program. This is because Chopra did not actually begin his residency Nov. 1, nor did he serve as a resident for “the year” outlined in his contract, Cleland wrote. On Aug. 29, Cleland issued his latest order denying a hospital motion for dismissal. He said Chopra provided “sufficient allegations ... to sustain recovery” of the $400,000 donation. He ordered a conference Sept. 6 between the parties at federal court in Detroit.

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Lisa Hulbert has joined AIS, a leading manufacturer of commercial office furniture and seating, as a direct-sales representative and territory manager covering Michigan. She will be responsible for educating dealers and growing market share in the state. Before joining AIS, Hulbert worked as an independent furniture representative for Workplace Resource Inc. where she represented AIS. Hulbert also worked as the North America workplace strategy manager for CBRE on the Dow Chemical account.

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KIRK PINHO/CRAIN’S DETROIT BUSINESS

The owners of for-profit Pontiac General Hospital allegedly required the parents of medical school graduate Varun Chopra to make $400,000 in payments in exchange for acceptance into the hospital’s family medicine residency program.

Financial turnaround coupled with problems Pontiac General, legally known as Oakland Physicians Medical Center LLC, has had more than its share of problems over the years. The hospital has gone through bankruptcy at least four times since it was established in 1910 as a city hospital and twice since 2008. It has gone through such name changes as Oakland Physicians Medical Center, North Oakland Medical Centers, Doctors Hospital of Michigan, Physicians Medical Center, and since 2016 has been called Pontiac General. In early 2016, Pontiac General emerged from bankruptcy after the Sharmas — CEO Sanyam, COO Priyam and Sanjay, its chief information officer — acquired a 60 percent interest in the hospital and began making repairs and turning it around. Neurosurgeon Jawad Shah owns 25 percent and Surindar Jolly owns 15 percent. From 2009 to 2015, Pontiac General lost more than $90 million and went through several owners. But in 2016 and 2017 under the Sharmas, the hospital earned net income of $35.3 million on annual revenue that totaled $182 million in 2017, according to Medicare cost reports provided by American Hospital Directory of Louisville. While Pontiac General is licensed for 306 beds, only 36 are staffed in a medical-surgical unit that averages less than 50 percent occupancy. Two of nine operating rooms are functioning. The hospital also operates a 24/7 urgent care center and a 30-bed adult psychiatric unit that averages more than a 90 percent occupancy. But two years after emerging from bankruptcy, Pontiac General has a whole new set of challenges, including multiple quality, regulatory and accreditation issues — almost all of which it has resolved — based on inspections from the Michigan Department of Licensing and Regulatory Affairs, the Centers for Medicare and Medicaid Services and the Joint Commission. Jack Weiner, director of strategic partnerships for Pontiac General, said in a statement that there are no pending citations from any oversight authority. Repairs to the heating and cooling system will be completed by the end of the year, he said. “When we bought the building out of bankruptcy in 2016, structural maintenance had been neglected for years,” said Weiner, who is the former CEO of St. Joseph Oakland Hospital in Pontiac. “Upon acquisition, we made a multimillion-dollar investment and are continuing to invest in repairs, growing the hospital and providing care to our patients.” Still, former nurses, managers and

other employees also told Crain’s stories of discrimination against Muslim and Arabic workers, lack of nurses to support patient load, not scheduling attending doctors to supervise residents and medical students from 7 p.m. to 7 a.m. and hiring emergency medical technicians instead of paramedics and nurses during midnight shifts in the urgent care center to save money. Pontiac General officials denied the practices cited by former employees and said attending doctors are present 24 hours. Other sources told Crain’s about problems in the psychiatric unit where young psychotic patients or those with substance abuse problems are mixed with elderly geriatric patients, creating dangerous situations for patients and staff. Medical screening of patients also is insufficient, leading to poor patient care, sources said. State inspectors have documented at least two deaths in the psychiatric unit since the Sharmas have been responsible for the hospital. The first occurred Oct. 9, 2015, shortly after the Sharmas began operating the hospital, and the second happened on Nov. 22, 2016, after they assumed ownership. Details of the circumstances of the deaths have been redacted from the LARA report for the Centers for Medicare and Medicaid Services that Crain’s obtained. Pontiac General denied any psychiatric patients have died at the hospital. Weiner has told Crain’s in previous interviews that patients have never been in danger because of hospital practices. “As part of our investment, we have hired employees in every department, including skilled medical experts and staff, to serve our patients. Pontiac General Hospital has become the premier hospital for mental health services, providing compassionate and expert care in treating an underserved population,” Weiner said. Last December, three employees filed an EEOC complaint against the hospital, claiming they were discriminated against because of their Arabic ethnicity and Muslim faith. Several other employees quit or were fired because they protested patient care conditions, lack of staffing and alleged disrespect, said four former employees who requested anonymity. Weiner said two-thirds of the hospital’s 295 employees are minorities. “Allegations made by a former employee are untrue and inconsistent with our culture and the values by which we run our business,” he said. “We are committed to treating all employees, patients and vendors fairly and with dignity and respect. Discrimination is not tolerated and statements to the contrary are hurtful and damaging.” Hospital officials confirmed the director of nursing and an ICU nurse

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Page 30

were fired last summer and several other nurses and employees have resigned for various reasons. â&#x20AC;&#x153;We are upgrading staff from human resources to dietary, infection control, laboratory, all to improve quality,â&#x20AC;? Weiner told Crainâ&#x20AC;&#x2122;s earlier this year. â&#x20AC;&#x153;We have significant plans to do better.â&#x20AC;? A nursing manager told Crainâ&#x20AC;&#x2122;s that the decision to do away with clinical nurse administrators who were willing to be advocates for the patients led to the firing of the nursing team in 2017. She said the firings were to silence the employees who were asking for more staff and questioning policies. Pontiac General officials denied any employee was fired for expressing their opinions. Weiner said the hospital has increased staff since 2016. But the hospital has 500 fewer workers than in 2008. Sources also said nearly all of the hospitalâ&#x20AC;&#x2122;s medical coding department have resigned because work is outsourced to a Texas-based company, InfraHealth Group, which is owned by Sanjay Sharma and uses workers based in India. Weiner said a small percentage of cases are coded by an outside medical administrative services company in India. He said the hospital has added staff in the medical coding department and denied any staff have left in protest.

Quality inspections Crainâ&#x20AC;&#x2122;s obtained more than 100 pages of state and federal inspection reports through the Freedom of Information Act dating to 2012. Another 100 pages were denied for release. Reviewing the documents, Crainâ&#x20AC;&#x2122;s found that owners before the Sharmas were cited for failure to meet various standards, but some problems continued into early 2018, and some have been fixed. Inspections by LARA found severe roof damage and inadequate maintenance, water damage in ceilings, stained carpet, lack of proper door seals in the event of a fire and substandard ventilation to prevent infection from spreading. In 2017, LARA found the hospital had â&#x20AC;&#x153;failed to develop and maintain an active hospital wide infection control program for the prevention, control and investigation of infections.â&#x20AC;? LARA concluded lack of training for an inspection control officer could increase the chances of infections. In January and March, state inspectors were at the hospital to follow up on new complaints. LARA spent three days at Pontiac General in January to investigate complaints about burst water pipes and a loss of heat in some patient care areas. Hospital employees told Crainâ&#x20AC;&#x2122;s patients complained, but hospital officials said few patients were affected. The inspection also found pipes in the ceiling above the cafeteria leaking raw sewage. Weiner said the roof has been repaired and pipes have been fixed. Other complaints, including lack of telemetry monitoring of patients, psychiatrists holding patients against their will and Medicare fraud were found by LARA to be unsubstantiated. Over the past year, Pontiac General has spent more than $2 million to upgrade its heating and cooling systems along with improving infection control, Weiner said. The improvements were mandated from an accreditation review last year by the Joint Commission.

Charges in India In 2010, the Sharma family purchased the license of shuttered St. Martinus University Faculty School of Medi-

SD ETROIT BUSINESS C R A I N â&#x20AC;&#x2122; S D E T R O I TCRAIN B Uâ&#x20AC;&#x2122;S IN ESS // S E P T E M B E R 3 , 2 0 1 8

cine on the Dutch island of Curacao and reopened it in 2011. Sanjay Sharma is president of the school. It currently is unaccredited but has started the process with the Caribbean Accreditation Authority for Education in Medicine, the regional agency recognized by the World Federation for Medical Education. It is charted by the government of Curacao and recognized by medical education bodies. Weiner said St. Martinus has about 500 students with a low 2-3 percent dropout rate. He said its match rate to residency programs for students was 66 percent in 2017. Since the school is private and unaccredited, Crainâ&#x20AC;&#x2122;s could not independently verify the data. In a 2016 interview, Sanyam Sharma described the business plans of the family. â&#x20AC;&#x153;We have Infrahealth (medical coding and administrative services) and the medical school. But if we want to really increase our revenue and business, we needed to buy a provider.â&#x20AC;? Sanyam Sharma said in 2016 the medical school planned to send 50 students a month to the hospital for rotations in family practice, psychiatry, surgery, pain management and radiology, generating up to $80,000 per month for the hospital by 2018. Earlier this year, the India Times reported that five people were arrested and three sought in Noida for participating in a fake medical school document scam that sold forged records to people seeking to apply at international medical schools. Crainâ&#x20AC;&#x2122;s was unable to reach the Noida police department for comment. At least one of the alleged participants is a member of the Sharma family who owns Pontiac General and one was an employee of St. Martinus, according to the India Times, which cited a police report filed by Noida Officer Rajeev Kumar Singh. Singh and other police raided an office called Sant Martin Administrative Services and arrested five people, including Marut Sharma, on several counts of fraud. Three others were being sought, including Sanjay Sharma, Pontiac General CIO; and Lalit Arora, who was director of admissions of St. Martinus and is listed as the general manager of InfraHealth. Weiner said the Indian judicial system differs from the U.S. system. â&#x20AC;&#x153;False and damaging statements were made against St. Martinus Administrative Services which operates by the highest standards and with the utmost integrity, helps collect admissions documents to apply to medical school,â&#x20AC;? he said. â&#x20AC;&#x153;While no criminal charges have been filed, we are confident that this matter will be quickly resolved in our favor,â&#x20AC;? he said. Noida police accused Sant Martin employees of charging people about $1,600 each for falsified medical school applications for schools mainly in the Netherlands. St. Martinus is based in Curacao, which is a province of the Netherlands. But the breach of contract lawsuit filed by the parents of Varun Chopra, who says he was promised a family medicine residency position if his parents paid Pontiac General $400,000, is one of the more serious accusations against the hospital. A spokesman for the Accreditation Council for Graduate Medical Education, which accredits residency programs, declined comment about the status of the Pontiac General program. Weiner confirmed the ACGME recently inspected the program several months ago and it was re-accredited. He said the family medicine residency program has always scored high marks under Hemady. Two sources told Crainâ&#x20AC;&#x2122;s they have

since reported the $400,000 payment and other problems with Pontiac General to the ACGME, the NMRP and the Association of American Medical Colleges, which manages ERAS. Crainâ&#x20AC;&#x2122;s contacted the organizations, and none wanted to comment.

What was donation for? In his deposition, Sanyam Sharma was asked why the Chopras would donate money to a for-profit hospital that they had no connection with and had never seen before. Donations are not tax-deductible to for-profit hospitals. â&#x20AC;&#x153;There are lots of reasons people donate money,â&#x20AC;? he said, adding that one reason is â&#x20AC;&#x153;they want to see the hospital succeed.â&#x20AC;? Satish Chopra said in court filings he learned of the possibility of paying for a residency slot from Paraminder Minhas, who also lives in Brampton, Ontario. Chopra said Minhas told him he gave the hospital a donation for his two children to enter Pontiac Generalâ&#x20AC;&#x2122;s residency program. Crainâ&#x20AC;&#x2122;s could not reach Minhas, but a source familiar with the residency program said Minhasâ&#x20AC;&#x2122; son, Dijot, is a current resident. Minhasâ&#x20AC;&#x2122; daughter, Gurman, completed her residency in 2016 and is a family practice doctor. Court documents provided by Pontiac General show that Minhas donated $99,000 on March 29, 2016, and $100,000 on May 1, 2016. During 2016 and 2017, the hospital collected $679,000 in donations in 36 separate payments. The three Chopra donations totaling $400,000 were not listed. In a sworn affidavit dated March 27, 2017, Minhas acknowledged making a $250,000 donation to the hospital, but he denied that the money was to secure residency spots for his children. He said he had made three payments to the hospital by the end of summer of 2016. Broder said Chopra was excited about the opportunity to fulfill his dream to become a practicing doctor. On Oct. 28, 2016, Varun Chopra emailed Hemady, stating in part, â&#x20AC;&#x153;It was very disappointing to hear that I will not be starting my post graduate training at Pontiac General Hospital. Unfortunately, I have only been told through second hand sources that I will not be starting the program.â&#x20AC;? On Nov. 1, Sanyam Sharma wrote a letter to Varun Chopra stating that he â&#x20AC;&#x153;no longer has a relationship with the hospital because he withdrew from the program.â&#x20AC;? In Sanyamâ&#x20AC;&#x2122;s deposition, he said no hospital officials removed him from the program. However, he was told that there was â&#x20AC;&#x153;an unprofessional demeanor about Varun during the observership program.â&#x20AC;? In a court document filed by Pontiac General attorneys March 27, 2017, hospital officials said that Chopra was a poor resident candidate, late for mandatory meetings and disrespectful to teaching doctors. Despite that, after Chopra left the program, â&#x20AC;&#x153;the hospital tried repeatedly to get Dr. Chopra to return to the residency program.â&#x20AC;? While Sanyam Sharma said the hospital did not terminate Chopraâ&#x20AC;&#x2122;s residency, the residency agreement both parties signed includes a provision allowing the hospital to terminate the agreement at its discretion if it finds that the resident has failed to fulfill his or her obligations under it. â&#x20AC;&#x153;Chopra signed a residency agreement, he had an observership agreement and he had a lease,â&#x20AC;? Broder said. â&#x20AC;&#x153;He was planning to complete the residency programâ&#x20AC;? when he was told he was no longer wanted, Broder said. Jay Greene: (313) 446-0325 Twitter: @jaybgreene

September 3, 2018 31

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C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

NAFTA FROM PAGE 3

 A reported quota allowing $90 billion in parts imported to the U.S. tariff-free, after which a 2.5 percent World Trade Organization standard tariff would apply. Last year, vehicle parts imported to the U.S. totaled roughly $75 billion. There’s also a 2.4 million vehicle quota on vehicles imported from Mexico. The content requirements were critical to the U.S., believing a higher standard would force more production stateside. Roughly 30 percent of the 2.33 million vehicles imported to the U.S. from Mexico in 2017 don’t meet the current 62.5 percent content requirement, Mexican Economy Minister Ildefonso Guajardo told Bloomberg TV last week. But only three vehicles imported to the U.S. — Nissan Versa, Audi SQ5 and the Fiat 500 — are above that threshold and below the new 75 percent requirement. Those vehicles sold a combined 177,097 units in the U.S. last year, according to Mexican publication Manufactura. This means Nissan, Audi and Fiat Chrysler will have to either pay the standard 2.5 percent WTO tariff on those models imported to the U.S. or shift production stateside. Theoretically, this could create jobs in the U.S. However, there’s no indication that manufacturers already paying the 2.5 percent tariff would alter production for 522,000 other vehicles imported from Mexico — they’ve already made the math work with the tariff in place. The $16-per-hour requirement could pose a threat to Mexico. The average wage for auto assembly workers in Mexico is $7.34 per hour and $3.41 per hour for parts supplier workers, compared to $29.08 per hour and $19.84 per hour in the U.S., respectively, according to the Center for Automotive Research. Theoretically, the agreement would cause a major shift in production by in-

Ildefonso Guajardo

BLOOMBERG

stalling a massive wage hike in Mexico. But WTO rules still apply. It’s likely much cheaper for manufacturers to pay the 2.5 percent tariff on parts and vehicles than shift production to U.S. or Canadian workers who earn as much as $21 more per hour, likely resulting in none to marginal jobs moving north. The quotas are perhaps the most troubling for the automotive industry. The agreement limits growth and caps future investment from automakers and parts suppliers in Mexico by levying a tariff on cars and parts exceeding those quotas. This amounts to a burdensome regulation that poses more harm to U.S. automakers than foreign. U.S. automaker competitors, such as Nissan, Volkswagen and Honda, rely on Mexico not only for its access to the U.S. market and its cheap labor. Mexico also has much larger access to the global auto market, with free trade agreements with 43 countries. The U.S. has free trade agreements with only 20. Many foreign automakers use Mexico as an export hub to Europe and Asia.

Crimping imports from Mexico into the U.S. is unlikely to stop foreign automakers from exporting elsewhere, but will limit those automakers’ and their suppliers’ ability to meet production demands at U.S. factories without a higher expense — which inevitably leads to higher costs for consumers. The real threat to this new agreement, however, isn’t just rising prices and a sputter of job creation; it’s that these rules effectively make automakers, particularly U.S. automakers, less competitive in the global market. The U.S. is no longer the largest vehicle market on earth. More than 17.4 million vehicles were sold in the U.S. in 2016, a record. Better than the roughly 17 million sold in 2005. But the reality is U.S. consumers are unlikely to ever purchase more than 17.5 million vehicles. U.S. sales were 17.1 million in 2017 and trending downward in a strong economy. Meanwhile, nearly 29 million cars were sold in China in 2017, accounting for more than 30 percent of global auto sales. More than 3 million cars last year were sold in India, which caused the emerging nation to overtake Germany as the fourth-largest car market behind China, U.S. and Japan. But the new (and improved?) NAFTA would force domestic automakers to focus more squarely on domestic production, even though General Motors sold more cars in China in 2017 than it did in the U.S. Today’s auto industry is increasingly focused on the emerging markets of China and India. If GM or Ford aren’t able to grow there, their profits will stagnate or, worse, drop. In Southeast Michigan, we know how that story plays out. Whatever job creation that could happen under this agreement couldn’t possibly stop those economics. Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

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What’s next then?

I don’t have anything formally lined up. Every opportunity has its circumstances and time frame. Between now and the end of the year, I plan to explore opportunities in those areas. I’m talking to a number of different people and trying to find something that best suits my skill sets and interest level. What’s the most memorable project you’ve worked on?

That’s a tough one to answer because I have been involved in a lot of very interesting things over the years. Most rewarding to me is being able to look around the landscape, particularly in the Detroit area, at some of the projects I have been involved with in some way, in either handling legal or governmental aspects, to look around and being able to count the many projects that fall into that category. Each one has its story and each one is a bit unique and different. One of the most recent is the new Wayne County criminal justice center, representing (Dan Gilbert’s) Rock (Ventures LLC), and that certainly is a very unusual project for a private developer to be taking on, to say the least. But it’s a good example of how every project is unique. That project (that prompted the new criminal justice complex) is particularly unique because it has a specific place in the public mindset as almost emblematic of government’s failure. I would look at it not as emblematic of the failure of government, but the success of government. Not the initial jail project, which neither I nor Rock were involved with, but the new project and the ability of Wayne County to be creative and work out this deal with Rock that really becomes a win-win proposition, not only for the county and the city, but also for Rock and the organization and Mr. Gilbert's desire to not only see what he thinks is an appropriate use of that (Gratiot Avenue) site, but accomplishing a pretty significant victory for the county and not only providing a new jail site, but the entire new criminal justice center. What’s unusual about it is the whole arrangement where you have a private developer taking on the responsibilities of working with the county in designing, constructing and developing a governmental justice center. What’s changed over the years, from your perspective, most notably in Detroit commercial real estate?

I would say one of the best, visible examples of change in the environment and cooperation and regionalism is the story of the Detroit RiverFront Conservancy. I was involved with that organization since literally before it was formed, and have served as the general counsel to the conservancy. The development that has taken place in the 15 years since the conservancy was formed is nothing short of phenomenal. In the 40 or 50 years before the conservancy was put together, there were all kinds of plans and studies and proposals about how to develop the river that never went anywhere. There are so many different stakeholders, and that was the problem, whether it was the state, city, council, various federal agencies, land owners. There were so many obstacles and hurdles. We had the amazing confluence of a number of unique

circumstances that allowed that project to take hold and to have accomplished an amazing amount of progress and development in a relatively short period of time that I don’t think would have been possible at another point in the city’s history. What were some of those factors?

There were a couple of important developments that allowed a lot of this to come together. The city, with largely casino funding, had acquired some key properties along the waterfront when that area was originally designated as the casino district. Fortunately, the city decided not to put the casinos there for a number of reasons, which made the land available for development. At the same time, you had the RenCen being taking over by General Motors, which was able to and interested in doing a lot of things with the property. The third is that you had a visionary guy like (Rock Ventures Principal and conservancy board chairman) Matt Cullen, who was very involved in the RenCen and downtown development and who, along with (former Detroit RiverFront Conservancy board vice chair) David Page, one of the key proponents of putting together the riverfront. All those circumstances coming together ultimately with the magnanimous $50 million grant from the Kresge Foundation became the nucleus for several key factors that allowed this to come together. Layered on to that, we had just unprecedented support and cooperation among a vast number of governmental and private organizations behind the project. You were involved in the creation of the RenCen. That project in particular has faced criticism for its perceived isolation from the rest of downtown. Should it have been done differently?

That project was one of the first projects I worked on as a young lawyer at the firm, working with another senior lawyer here. It was my first taste of working on a major, complicated urban development. It’s always been a favorite project to talk about and look at. Through sort of unusual circumstances, even though that was originally built by Ford, it ended up being owned by GM. The project has been criticized and written about in terms of its fortress-like original design and construction, and I’m not sure that was ever an intentional goal or a program objective, if you will, of the original developers. I think it was more the style of John Portman, who was the architect of that project. But I think one of the satisfying things to me with my long involvement with that project is how GM took that and completely turned it around, opening up the front and back of the project, making it much more interrelated and interconnected with the rest of downtown. So what’s next for Detroit commercial real estate?

There are several other downtown projects in the works, in the preliminary stages. Many of these projects, as you know, are on a long horizon. They don’t happen overnight, between the land assembly and financing challenges that all projects have in the city. But I am working with developers on projects in Brush Park and Eastern Market, a couple other things that are going on as we speak. Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

BILLS FROM PAGE 1

Lyon’s legal bills alone over three fiscal years exceed what Genesee County spends annually for defense attorneys who represent indigent residents. “It’s unheard of. It’s beyond exorbitant,” said William Whitbeck, a retired Court of Appeals judge who was paid nearly $300,000 by Schuette to evaluate charges leveled by a special prosecutor. “If you or I were to commit a crime or even be charged with committing a crime, we’d pay our own way. There’s no reason in God’s green earth why a similarly situated citizen who happens to be a state employee should be treated differently.” Schuette, the Republican nominee for governor, has run up some big bills himself in pursuit of criminal convictions of state officials he says are culpable for Flint’s tainted water. To date, Schuette’s investigation, run by the Royal Oak law firm of attorney Todd Flood, has spent $6.9 million. The Legislature has approved an additional $3.1 million for the prosecutions over the next 13 months. Three years have passed since elevated levels of toxic lead were discovered in the city’s drinking water, and, despite deep distrust from residents, public health officials have since declared the Vehicle City’s tap water safe to drink again. But there’s no end in sight for the legal recriminations from the crisis that are keeping some private attorneys in Michigan busy. Not a single trial from Schuette’s litany of charges against 15 current and former local and state officials has begun, with Lyon just getting bound over for trial two weeks ago in Genesee County Circuit Court after a laborious 11-month preliminary examination in district court. Gov. Rick Snyder’s administration has spent at least $13.75 million to date on private attorneys hired to produce some 2 million pages of records for Schuette and Flood’s investigation and represent the governor and at least 30 state employees in the criminal probe and subsequent court proceedings, state records show. Richard McLellan, a Lansing attorney and ally of Lyon, said the outgoing Republican governor is “doing the right thing” using taxpayer money to defend “his people” in court. “Yeah, it costs money. But what is the cost of maybe going to prison for 15 years for something you didn’t do?” McLellan said, referencing the prison sentence Lyon faces for involuntary manslaughter. “... What’s Snyder supposed to do? Say, ‘Oh, it’s too much. You’re just going to have to be on your own.’”

Wading through the evidence Criminal defense attorneys from private law firms representing state officials charged in the Flint water cases say Flood has waged a disorganized prosecution that has added to the time and length of the proceedings in multiple Genesee County courtrooms. “If you’re wondering why our legal fees are so high, attorneys have to wade through millions of pages of documents to find things related to their clients,” said attorney Mary Chartier, whose Lansing law firm has been paid nearly $800,000 representing health department data manager Robert Scott in criminal and civil cases. “We’ve re-

Flint water law firm expenses The Royal Oak law firm of Special Assistant Attorney General Todd Flood has billed the state nearly $7 million for his investigation and subsequent prosecution of state and local officials in the Flint water crisis. Total spending on private law firms for the investigations and defense of state employees has topped $26.5 million, with capacity in current contracts for up to $34.5 million. Gov. Rick Snyder’s administration has provided private attorneys for the governor and at least 30 individual state employees in the governor’s office and the departments of health and human services and environmental quality. Law

Amount

Client

Flood Law

$6,978,837

Attorney General Bill Schuette’s Flint water investigation team, expert witnesses, prosecution team and other outside counsel

Warner Norcross & Judd LLP

$3,883,440

Gov. Rick Snyder and his office

Clark Hill PLC

$2,314,102

Former Department of Environmental Quality Director Dan Wyant and his former communications director, Brad Wurfel

Barris, Sott, Denn & Driker P.L.L.C

$1,778,775

Gov. Rick Snyder and his office

Willey & Chamberlain LLP

$1,501,584

Nick Lyon, director of the Department of Health and Human Services Director

$1,416,478

Foster Swift Collins & Smith PC Kotz Sangster Wysocki P.C.

$1,284,739 $1,031,746

Fraser Trebilcock

Mike Prysby, Patrick Cook and Adam Rosenthal, DEQ water quality office employees Stephen Busch, DEQ water quality office district supervisor Lianne Sheker-Smith, former DEQ water quality chief

Varnum Law

$1,025,342

Michigan Department of Health and Human Services

Alana & Chartier PLC

$795,197

Robert Scott, data manager at DHHS

Pear Eggan & Daniels PLC

$651,914

Eden Wells, M.D., chief medical executive at DHHS

LaRene & Kriger PLC

$317,078

Stephen Busch, DEQ water quality office district supervisor

Smietanka, Buckleitner, Steffes & Gezon

220,154

Patrick Cook, DEQ water quality specialist

McShane & Bowie PLC

$156,880

Sarah Lyon Callo and Cirstin Larder, DHHS epidemiologists

Cafferty & Associates

$147,004

Nancy Peeler, program director at DHHS

Sources: Gov. Rick Snyder’s office; Attorney General Bill Schuette’s office; state departments of treasury, environmental quality and health and human services.

ceived over 2 million documents in discovery. They were not organized in any particular manner.” Pear, Sperling, Eggan & Daniels, an Ann Arbor law firm representing the state’s chief medical executive, Eden Wells, M.D., also pointed to delays in receiving the state’s evidence against their client as contributing to their ever-growing legal bills. “In fact, many of the exhibits were not provided to the defense until the moment they were offered as evidence during the examination,” the law firm said in a statement to Crain’s. “The prosecution appeared unprepared to proceed with the examination at the time it brought the original charges against Dr. Wells, and expanded and modified the charges against Dr. Wells as the matter proceeded.” Schuette spokeswoman Andrea Bitely said Flood’s team provided defense attorneys documents “in the format we received them” from the Snyder administration. “We shared all evidence as it became relevant,” Bitely told Crain’s. Like her boss, Wells also faces a manslaughter charge for the Legionnaires’ death of 83-year-old John Snyder. Her preliminary examination spanned ten months and 18 days in court. Flood called 13 witnesses; the defense team called five witnesses. Pear, Sperling, Eggan & Daniels has billed the state nearly $652,000 for Wells’ legal defense to date; the state Administrative Board increased the law firm’s contract to $1.1 million on Aug. 23. “This case is not comparable to any other case this firm has defended,” Wells’ attorneys said in a statement. DHHS also has retained Varnum Law to represent the department as a whole in Schuette’s criminal investigations. The Grand Rapids-based law

firm has billed DHHS more than $1 million and has a contract for $1.55 million, according to state records. “Varnum Law firm, like the law firms hired by other State agencies, has advised the department and protected the department’s interests throughout these investigations as well as in connection with the later prosecution of department employees,” DHHS spokeswoman Angela Minicuci said in an email to Crain’s. DHHS has spent nearly $6 million to date on private law firms and other legal expenses defending its employees in civil litigation and Schuette’s criminal investigation, records show. The department has contract capacity to spend another $5 million on private legal representation. Lyon’s legal team includes former Solicitor General John Bursch, who is seen as one of the country’s top appellate attorneys. He has argued 27 times before the Michigan Supreme Court and 11 times before the U.S. Supreme Court. Bursch had billed the department about $118,000 on his $400,000 contract through mid-August, records show. “That’s a pretty heavy-duty legal team they’ve put together — costing a lot of money,” Whitbeck said. “And you and I and the rest of the citizens of Michigan are paying for it.” Chartier’s firm also was recently retained to help represent Lyon for common issues in public health that cross over in the case against Scott, who is accused of covering a report showing a spike in lead levels in the blood of Flint children. Even though the Department of Health and Human Services gave her firm a $400,000 contract, Chartier said, “We don’t anticipate it going beyond $10,000."

‘Working diligently’ Stephen Busch, a Department of Environmental Quality water official who oversaw Flint’s switch from Detroit’s water system, has received $1.5 million in legal representation to date from private attorneys in both the civil and criminal cases against him. The lion’s share of Busch’s legal bills stem from dozens of lawsuits filed by residents of Flint over the leaching of lead into Flint’s drinking water system. The preliminary examination of Schuette’s evidence that Busch and other DEQ employees covered up Flint’s water problems only recently began this summer; he was charged criminally and suspended with pay more than two years ago in April of 2016. Flood added an involuntary manslaughter charge against Busch last summer when he charged Lyon, the highest-ranking member of the Snyder administration to be charged criminally over the Flint water crisis. Busch’s criminal defense attorneys at LaRene & Kriger PLC have billed the DEQ for more than $317,000 in fees and expenses to date. Attorney Mark Kriger, a partner at the downtown Detroit law firm, said the cost of Busch’s criminal defense is “not excessive” given the complexity of the case. “Both the defense and prosecution have been working diligently on this case,” Kriger said. “But given the volume of material and the difficulty of coordinating schedules, the amount of time this case has taken is not excessive.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

www.crainsdetroit.com Editor-in-Chief Keith E. Crain President KC Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Product Director Kim Waatti, (313) 446-6764 or kwaatti@crain.com Digital Product Manager Carlos Portocarrero, (313) 446-6056 or cportocarrero@crain.com Creative Director David Kordalski, (216) 771-5169 or dkordalski@crain.com Assistant Managing Editor Dawn Riffenburg, (313) 446-5800, driffenburg@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Special Projects Editor Amy Elliott Bragg, (313) 446-1646 or abragg@crain.com Design and Copy Editor Beth Jachman, (313) 446-0356 or bjachman@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687, TIP LINE (313) 446-6766

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C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 3 , 2 0 1 8

THE WEEK ON THE WEB

RUMBLINGS

Drinking water being shut off at all Detroit public schools

Toma Detroit wins $50,000 Hatch prize

AUGUST 24-30 | For more, visit crainsdetroit.com

etroit Public Schools Community District shut off drinking water at all of its 106 schools after the most recent round of testing found 16 out of 24 schools had elevated levels of lead and/or copper, Superintendent Nikolai Vitti said in an email to staff last week. Vitti ordered testing of all schools this spring, after tests in 2016 found elevated levels of the metals. Initial results for 24 schools returned last week found 16 had levels higher than acceptable, he said in the emailed letter. All water sources, including drinking fountains and sinks, were tested. Water is still available for hand washing and toilet flushing. “Although we have no evidence that there are elevated levels of copper or lead in our other schools (over 50) where we are awaiting test results, out of an abundance of caution and concern for the safety of our students and employees, I am turning off all drinking water in our schools until a deeper and broader analysis can be conducted to determine the long-term solutions for all schools,” Vitti said in an emailed statement last Wednesday. Vitti is planning to create a task force of water quality and engineering experts to “understand the cause and identify solutions,” schools spokeswoman Chrystal Wilson told Crain's last Thursday. The Associated Press reported in 2016 that elevated copper or lead levels had been found at 19 DPSCD schools. After those results, the district coated some pipes with a silicate to prevent leeching of metal and bacteria, Chalkbeat Detroit reported. The 2016 testing came as a response to the Flint water crisis, in which more than 100,000 residents were exposed to lead-tainted water. The largest school district in Michigan is confronting the major investment it could take to quell concerns due to elevated lead and copper levels found in some schools’ water as it deals with deteriorating school buildings that require nearly $530 million in capital improvements. The city of Detroit also plans to work with charter schools on similar water testing, which it can encourage but not mandate, city spokesman John Roach told Crain’s. Vitti said letters would be sent home to students when the school year starts this and parents were informed via a robo-call system last week. Teachers reported to work last Monday. The Great Lakes Water Authority (GLWA) and the Detroit Water and Sewerage Department (DWSD) issued a statement last Wednesday afternoon to assure their customers that the water they are providing is safe. Vitti's decision to shut off drinking water came after results sent by ATC Group Services LLC in mid-August showed 16 schools exceeded lead and/or copper limits set by the EPA, according to the ATC Group Services reports. They include Cass Technical High School and Renaissance High School. The most recent data was posted on the city of city of Detroit’s website as of

Detroit Public Schools Community District shut off drinking water at all of its 106 schools after the most recent round of testing found 16 out of 24 schools had elevated levels of lead and/or copper.

Detroit digits A numbers-focused look at last week’s headlines:

The number of volunteers who were to spend at least 160 hours setting up the 4,000-seat venue for Aretha Franklin’s funeral service last Friday.

The number of urgent care centers Beaumont Health plans to open in metro Detroit by the end of 2019.

211,000

The Michigan Consumers Energy Co. customers who lost power last week due to a severe bout of weather and thunderstorms; some in Hancock saw a funnel cloud.

last Thursday. Results showed elevated levels, some of which were just above recommended limits. Some were up to five times over limits and in one case, 10 times the lead limit for a drinking water faucet in a basement at the Academy of the Americas Elementary-Middle School.

BUSINESS NEWS Indian conglomerate KPIT Technologies Ltd. plans to expand its U.S. presence in Novi by investing $2.8 million into its Novi office and hire 171 new employees. The majority of the new hires will be programmers and computer engineers. KPIT subsidiary, KPIT Infosytems Inc., will receive a $1.1 million performance-based grant from the state of Michigan to support its growth, the Michigan Economic Development Corp. said in a memo. J The Detroit Medical Center and the Wayne State University Physicians Group last week signed a memorandum of agreement on a five-year contract for clinical and medical administrative services. A finalized agreement is expected in late September, according to a DMC email sent to Crain’s. It would reverse course on what had seemed to be a disintegrating relationship between the two organizations after a century-long partnership. The deal would allow more than 300 Wayne State physicians to “continue to provide J

patients with clinical care for select adult services and select medical leadership for DMC services,” the email said. J Construction on a long-stalled, $40.8 million mixed-use development near Detroit’s Midtown neighborhood is now anticipated to begin in October, according to the project’s developer and the state. The Michigan Strategic Fund has reapproved its $4.3 million equity stake. One of the developers, Chris Jackson, said The Woodward @ Midtown project has increased in size from 104 to 134 apartments and continues to have 15,000 square feet of retail space planned, including a second Kuzzo’s Chicken & Waffles restaurant. A 150-space parking deck is also planned on the site. J The Detroit RiverFront Conservancy broke ground last Monday on Atwater Beach along Detroit’s east riverfront — a $6 million project that will transform a former industrial site. When it opens next summer, it is expected to include a sandy beach area, a 1,000-square-foot shed with garage-door style openings, an overhang and patio area, a musical garden and a floating barge. The Atwater Beach concept is part of the original overall plan for the east riverfront announced in March 2017. The new features and beach area will build on an extension of the Detroit RiverWalk underway to span the area from east of Chene Park to west of the Stroh Riverplace.

OTHER NEWS J Aimed at attracting teachers from pre-K through 12th grade to Detroit, the Teach 313 campaign is looking to corporate incentives centered on quality of life to sweeten Detroit’s profile for job seekers. A public-private effort led by the Skillman Foundation and Detroit Children’s Fund has launched the national campaign. Its goal is to improve the quality of education in Detroit through both recruitment and professional development to combat teacher attrition of nearly 30 percent each year in Detroit schools. J The consortium of infrastructure companies that will construct the Gordie Howe International Bridge are assuming a fixed cost of more than $2.68 billion to build what will become North America’s largest cable-stayed bridge over the Detroit River. The Canadian government will subsidize $2.12 billion of the cost.

cocktail and food-tasting enterprise landed the $50,000 Hatch Detroit prize to help open up shop. Toma Detroit LLC took home the top prize of the 2018 Comerica Hatch Detroit Contest presented by Bedrock on Thursday evening at the Madison Building. The new establishment, which is registered to Corey McIntosh, plans to serve Latin American drinks and eats that are sourced locally, a news release said. The tasting room in Corktown will carry tequila and mezcal and patrons can learn from staff about distillation methods. The new company also stands to gain from more than $200,000 in free support and counsel from Hatch Detroit collaborators. Services include legal help from Honigman Miller Schwartz and Cohn, ar-

chitectural design, IT, technical assistance, mentoring and public relations services, the release said. “Year after year we’re inspired by the creativity and enthusiasm of these entrepreneurs and impressed with their innovative business ideas and this year is no exception,” Michael T. Ritchie, president of Comerica Bank-Michigan, said in the release. Toma Detroit was also awarded a $5,000 prize from the 2018 TechTown Retail Boot Camp. Since its inception in 2011, Hatch Detroit has invested $6.5 million into helping entrepreneurs launch 34 businesses that employ more than 500 people. Previous winners include Baobab Fare, Meta Physica Wellness Center, Live Cycle Delight, Sister Pie, Batch Brewing Co., La Feria and Hugh.

Floyd’s new sofa is scheduled to begin shipping in October. The two-seaters, three-seaters and sectionals are priced $1,200-$1,600.

FLOYD

Furniture startup Floyd expands with first sofa D

etroit-based startup Floyd LLC is preparing to launch its first sofa as it expands its minimalistic, made-for-millennials furniture line. The $1,200-$1,600 Floyd sofas are scheduled to ship in October, with presales starting Sept. 20. Co-founders Kyle Hoff, 31, and Alex O’Dell, 28, say they expect the modular units to be a cornerstone product of the company, born out of a set of table legs in 2014. Sofas will be available as two-seaters, three-seaters and sectionals with an upholstered or birch wood frame. In its direct-to-consumer model, the sofas can be purchased online and will ship flat-packed, with assembly taking a few minutes, according to a news release. “Today, it’s really about tackling each vertical of the home — table, sofa, bed frame,” Hoff said. “We have one furniture product per category. It’s really about doing that one product and doing it well.” In addition to the sofa, Floyd

sells a $650 bed, $595 table and $160 side table. Owners say its self-assemble designs improve upon those by Swedish giant Ikea, which dominates the segment. As with Floyd’s other products, the sofa is marketed toward millennials living in big cities. Floyd’s approach appears to be working. More than 10,000 people are on a waitlist for the sofa presale, according to the owners. Company revenue has tripled each year for the past three years and is expected to do the same next year. Owners declined to give specific revenue figures or sales totals. They told Crain’s in April 2017 that bed sales had grown by 250 percent and revenue was expected to top $5 million that year. In January, the company raised $5.6 million of capital in its first round of funding from investors such as Airbnb co-founder Joe Gebbia and LZB Investments, the investment arm of Monroe-based La-Z-Boy. Next on the list for Floyd? A bookshelf.

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NOV. 15

6 – 9:30 p.m. | Roostertail, Detroit

REGISTER AT crainsdetroit.com/celebration Are you a Crain’s Member? Email us at cdbevents@crain.com for your individual ticket discount.

Interested in sponsorship opportunities for this event? Contact Lisa Rudy at lrudy@crain.com.

LOCATION SPONSOR

AFTER GLOW SPONSOR

PRINT SPONSOR

CRAIN’S DETROIT BUS INES TER OF S EV PRIN IAL EN FIC

TITLE SPONSOR

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