Pages 1-32 - Crain`s Detroit Business

Transcription

20131118-NEWS--0001-NAT-CCI-CD_--
11/15/2013
6:10 PM
Page 1
®
www.crainsdetroit.com Vol. 29, No. 47
NOVEMBER 18 – 24, 2013
$2 a copy; $59 a year
©Entire contents copyright 2013 by Crain Communications Inc. All rights reserved
Page 3
Town Center
owner weighs 4
purchase offers
As Detroit spends
millions on
consultants, some
officials wonder: Is
Kevyn Orr driving new
road with old map?
Page 26
Surgical
resident’s
plan fills
gap in
cancer
care
Comerica Park has a
field day
Inside
Visteon steadies finances,
weighs next move,
Page 16
This Just In
UM to expand MCubed
program to public ideas
NEWSPAPER
The University of Michigan is
inviting people outside its
walls to join a research funding effort that’s jump-starting ideas and collaboration
among professors.
Officials at the Ann Arbor
school said Friday they were
announcing the expansion of
the MCubed program, which
started last year. The project
allows an individual or
group with $75,000 to post an
idea or challenge and engage
with professors who want to
tackle it.
The program offers an alternative to government
funding or other forms of private investment. Potential
examples include a family
enabling unconventional research into a disease or supporters launching an art
preservation project through
digital media.
Mark Burns, MCubed executive committee chairman,
said people with “a passion
for a particular area” can tap
the university’s knowledge
for far less money than the
usual methods.
— Associated Press
Detroit in
transition
The owner of the Southfield
Town Center is considering offers
to buy the landmark office complex, in default on its mortgage
with $138 million owed.
New York City-based Blackstone Group LP is considering four
offers from local and out-of-state
buyers for the 2.2 million-squarefoot Class A office complex,
north of 10 Mile Road between M10 and Evergreen Road, according to real estate sources.
Those offers are between $160
million and $170 million, sources
say. Blackstone purchased the
five-building complex in 1999 for
$270 million, according to real estate information service CoStar
Group Inc.
According to commercial
Transition team,
recruiting the best
talent are mayorelect’s first
priorities, Page 27
3000
Tower
4000
Tower
KENNY CORBIN
Rizzo looks to hire in wake
of waste contract win,
Page 4
BY KIRK PINHO
CRAIN’S DETROIT BUSINESS
mortgage backed securities data
from Bloomberg LP, Blackstone is
unable to pay the balance due on
a $235 million mortgage on the
property originated in 2004 by
Irving, Calif.-based Greenwich
Capital Financial Products Inc. The
loan was transferred to Wells Fargo Bank NA for special servicing.
A loan modification letter
originally stipulated that Blackstone pay the balance by Nov. 5,
2012. The complex was appraised
this summer at $177.5 million, 45
percent below a 2004 appraisal of
$321 million, according to the
Bloomberg loan data.
According to a real estate
source, an out-of-state buyer that
has never purchased real estate
in metro Detroit is currently the
highest bidder.
The complex is 32 percent vaSee Sale, Page 25
2000
Tower
1000
Tower
The proposed
sale includes
the four towers
of the
Southfield
Town Center.
DMC pact to keep Karmanos name off local McLaren sites
BY JAY GREENE
Flint-based McLaren Health Care
Inc. plans a major statewide branding campaign after the ink dries
sometime in early December on its
acquisition of Karmanos Cancer Institute, one of the nation’s 41 comprehensive cancer centers.
But, with a couple of exceptions,
it won’t be in Wayne, Oakland or
Macomb counties.
That’s because when Karmanos
acquired the Detroit Medical Center’s $100 million
cancer operation in 2005 for
$10 million, Karmanos agreed to
advertise, market services and
brand its name
only with the
Lane
DMC in Wayne,
Oakland and Macomb counties, officials with McLaren, Karmanos
and DMC confirmed to Crain’s.
Karmanos also leases space on the
DMC campus in Detroit.
“Karmanos has an extremely attractive brand, and we are very
cognizant on the restrictions
placed on us,” said Greg Lane,
McLaren’s chief administrative officer. “Nothing precludes us from
using the Karmanos name outside
of the tri-county area.”
Lane said McLaren plans a comprehensive marketing and advertising campaign outside of the
For advertising information, contact Marla Wise
at 313-446-6032 or [email protected]
three counties in Southeast Michigan. He said McLaren does business in 53 of Michigan’s 83 counties.
Kevin Tompkins, McLaren’s director of marketing, said the preliminary plan is to use the Karmanos name at nine of McLaren’s
10 hospitals and 11 of 14 outpatient
cancer center locations in northern and eastern Michigan that include Bay City, Lansing, Petoskey
See Karmanos, Page 28
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November 18, 2013
MICHIGAN BRIEFS
Northern Mich. microbrewery
grows pub, plans retail store
Short’s Brewing Co. plans to essentially double the size of its
brewpub in Bellaire, adding more
seats and a new retail store,
MLive.com reported. The 9-yearold northern Michigan microbrewery is responding to a quickly
growing fan base as its beers are
distributed throughout the state.
Short’s is working to acquire
purchase agreements for three lots
and four buildings adjacent to its
current location. It plans to expand its 4,000-square-foot pub and
brew house into connecting storefronts.
The brewpub will have more
space for patrons along with a retail store offering apparel, bar accessories, artwork and more.
Short’s expects to spend $1.2
million on the project and create
20 full-time jobs. Construction is
expected to be complete before
summer 2014.
Federal court: DPH Holdings
must clean up polluted sites
A U.S. Bankruptcy Court judge
has ordered DPH Holdings Corp.,
formerly known as Delphi, to pay
$23.3 million to clean up four polluted sites in Michigan and Ohio,
according to MLive.com.
Three of the four properties in-
That’s a wrap: Firm offers new ad surfaces for retailers
Here’s something new for a captive audience: A
West Michigan startup wants to capitalize on the
forced presence of consumers at checkout lanes by
turning a formerly blank surface — the checkout
conveyor belt — into an advertising opportunity.
Grand Rapids-based Handstand Innovations LLC piloted its concept at local grocery stores, but the firm
aims to take its product to the global market. The
company just completed a $600,000 equity offering
with Annapolis, Md.-based Compass Marketing, a
multinational strategic marketing firm.
Susan Vanderploeg founded Handstand in 2009
with the idea of being a retail innovations company
and placing branded advertising on the checkout
lanes and other surfaces of groceries and retail
stores. It has nine employees and a second office in
Washington, D.C. Handstand declined to give revenue figures, citing its young age.
In partnership with Walker-based conveyor belt
manufacturer Mol Belting Systems Inc., Handstand
developed its MessageWrap product. The coated, antimicrobial belts are easily installed in the checkout
volved in the settlement include
Delphi’s shuttered Dort Highway
Flint East Plant 400 and Plant 500
in Flint, and the former Delphi Saginaw Division Plant 2 in Saginaw.
The fourth plant is an inactive asbestos landfill in Rootstown, Ohio.
The three properties are among
the last of DPH’s assets, and Delphi
expects to wrap up its bankruptcy
proceedings and dissolve by year’s
end, according to the U.S. Attorney’s Office.
lines of grocery stores and have an easy-to-clean
surface that is more sanitary than typical conveyor
belts, Vanderploeg said.
The new belts also contain eye-catching ads the
company believes will grab shoppers’ attention better than the typical ads scattered around stores.
Handstand has spoken with Wal-Mart Stores Inc.
corporate executives about getting MessageWrap in
all 4,000 of its stores around the U.S. Handstand currently has distribution for its product in grocery
stores in several countries.
“People will just have the expectation that they
will be able to use MessageWrap for any type of promotion,” Vanderploeg said. “Retailers are like puppy
dogs. Once somebody is doing it, everyone else is.”
In 2011, Handstand installed a prototype of the
checkout product at Forest Hills Foods, a suburban
Grand Rapids grocer acquired by Spartan Stores last
year. In January, Spartan approved the deployment
of MessageWrap advertising in 82 of its stores
around Michigan.
— MiBiz
MICH-CELLANEOUS
䡲 Horizon Bancorp will expand its
presence in Michigan with the
planned acquisition of Summit
Community Bank in East Lansing,
MiBiz reported. Michigan City,
Ind.-based Horizon expects the
$18.4 million stock-and-cash transaction to close in the second quarter of 2014. Summit Community
Bank has two offices in the Lansing area and assets of $161.0 mil-
lion. Horizon Bank, with assets of
$1.8 billion, has 29 offices in northern Indiana and southwestern
Michigan, and is planning to move
into the Grand Rapids market.
䡲 Ventra Grand Rapids 5 LLC plans
to invest $16.3 million over three
years and create up to 150 new jobs
in Kentwood to launch a new automotive lighting line, according to
MiBiz. The automotive supplier, a
division of Urbana, Ill.-based Flex-NGate, plans to invest in new equip-
ment and machinery, and purchase
and renovate a new facility.
䡲 A historic building in downtown Grand Rapids that recently
fell into receivership has new owners, MiBiz reported. Grand Rapidsbased law firm Keller & Almassian
PLC recently closed on the property
at 230 E. Fulton St. and hopes to
move into the building, known as
the Pike House by next summer.
The two-story, 25,000-square-foot
building was bought by Keller & Almassian from Amicus Management
for just more than $1 million.
䡲 Financial planning company
Oliver LaGore VanValin Investment
Group announced it will relocate
from Burton into the historic Durant building in downtown Flint,
MLive.com reported. Dean Oliver,
the company’s CEO, said the move
will be a long-term investment into
the city of Flint.
䡲 Sparrow Health System will replace seven registered nurses with
medical assistants within 90 days at
its two urgent care centers, the
Lansing State Journal reported.
The Lansing-based hospital system
said the move is the result of a
staffing review and will affect fulland part-time nurses at care centers
in Mason and Meridian Township.
Find business news from
around the state at crainsdetroit
.com/crainsmichiganbusiness.
Sign up for Crain's Michigan
Business e-newsletter at crains
detroit.com/emailsignup.
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November 18, 2013
Page 3
Second Stage
Comerica has a field day
Playing surface replacement not a walk in the park
he grass playing field at Comerica
Park has been entirely stripped away
to the naked brown earth for the installation next month of a new surface —
ice.
At a cost of up to $1 million, the National
Hockey League is paying Kitty Hawk, N.C.based Rink Specialists Inc. to build a temporary ice rink on the baseball stadium’s infield for the Hockeytown Winter Festival
games at the end of December.
T
New Kentucky bluegrass will be installed
early next year at Comerica in the first fullfield sod replacement at the ballpark since
2007.
The Detroit Tigers haven’t awarded the
contract to a sod farm for the new grass,
which is scheduled to be installed in March
to give it a month to take root before the
2014 baseball season begins.
The temporary ice and permanent grass
represent the latest new playing surfaces
installed in recent years by the region’s
professional and college sports teams,
each ranging in price from $100,000 up to
$1 million.
The Detroit Pistons bought a new basketball court in 2011 and the Detroit Lions installed new artificial turf earlier this year.
The University of Michigan and Michigan State
University have replaced their football fields
since 2010.
The exception is the Detroit Red Wings,
who put down a new sheet of ice at Joe
Louis Arena before each season using the
original ice-making equipment at the 34year-old venue.
Resident’s plan fills gap in St. John Macomb cancer care
BY JAY GREENE
As a surgical resident at St. John Macomb-Oakland Hospital, Macomb Center in
Warren two years ago, Carlos Ramirez,
M.D., saw dozens of patients with advanced head or neck cancer leave for
specialized surgery at other hospitals in
Southeast Michigan.
Not only was St. John Macomb losing
revenue because the hospital did not
have a microvascular reconstruction
program, cancer patients with established local medical and dental relationships were having to travel longer distances for their care.
So in early 2011, Ramirez presented a
proposal — complete with financial projections that now amount to $1.2 million
in first-year net revenue — for the
surgery program to William Bloom,
D.D.S., oral maxillofacial surgery chairman, and Dhafer Salama, M.D., hospital
chief of staff.
The three physicians then presented
the plan to Terry Hamilton, president of
St. John Macomb, who recommended
the program to Jean Meyer, interim
CEO of five-hospital St. John Providence
Health System, the hospital’s parent organization.
But Ramirez, who was still a physician in training, needed to complete a 12See Cancer, Page 25
Company index
These companies have significant mention in this
week’s Crain’s Detroit Business:
See Comerica, Page 29
New Kentucky bluegrass will be installed
early next year at Comerica Park in the
first full-field sod replacement at the
ballpark since 2007.
New skills build a
turnaround, Page 11
NATHAN SKID / CDB
BY BILL SHEA
AlixPartners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Ann Arbor Spark . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Baird Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Beaumont Health System . . . . . . . . . . . . . . . . . . . 28
Brinks, Gilson & Lione . . . . . . . . . . . . . . . . . . . . . 13
CBRE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Citizens Research Council of Michigan . . . . . . . . . 26
Consumers Energy . . . . . . . . . . . . . . . . . . . . . . . . 10
Core Partners Associates . . . . . . . . . . . . . . . . 15, 25
Covaron Advanced Materials . . . . . . . . . . . . . . . . . . 6
Danlaw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
DeBuck Sod Farm . . . . . . . . . . . . . . . . . . . . . . . . . 29
Detroit Bus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Detroit Lions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Detroit Medical Center . . . . . . . . . . . . . . . . . . . . . . 1
Detroit Pistons . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Detroit Red Wings . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Detroit Tigers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Detroit Renewable Energy . . . . . . . . . . . . . . . . . . . . 4
Detroit Renewable Power . . . . . . . . . . . . . . . . . . . . 4
DTE Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Energy Choice Now . . . . . . . . . . . . . . . . . . . . . . . . 10
Fifth Third Bank . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ForeSee Results . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Ginosko Development . . . . . . . . . . . . . . . . . . . . . . 15
GlobalHue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Henry Ford Health System . . . . . . . . . . . . . . . . . . . 28
Henry Ford Hospital . . . . . . . . . . . . . . . . . . . . . . . 25
HistoSonics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Honigman Miller Schwartz and Cohn . . . . . . . . . . . 28
Hosco Fittings . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Industrial Visions . . . . . . . . . . . . . . . . . . . . . . . . . 12
Karmanos Cancer Institute . . . . . . . . . . . . . . . . . . . 1
Kenneth J. Dalto & Associates . . . . . . . . . . . . . . . 11
LMC Automotive . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Loomis Sayles . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
McLaren Health Care . . . . . . . . . . . . . . . . . . . . . . . 1
Metro Airport Taxi . . . . . . . . . . . . . . . . . . . . . . . . . 29
Metro Cars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Michigan Bankers Association . . . . . . . . . . . . . . . 13
Michigan Economic Development . . . . . . . . . . . . . 12
Michigan Jobs & Energy Coalition . . . . . . . . . . . . . 10
Michigan State University . . . . . . . . . . . . . . . . . . . . 3
Mobile Comply . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Mobile Technology Association of Michigan . . . . . . 13
NAI Farbman . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Newmark Grubb Knight Frank . . . . . . . . . . . . . . . . 25
Oakwood Healthcare . . . . . . . . . . . . . . . . . . . . . . 28
O’Keefe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Original Equipment Suppliers Association . . . . . . . 14
Rizzo Environmental Services . . . . . . . . . . . . . . . . . 4
St. John Macomb-Oakland Hospital . . . . . . . . . . . . . 3
St. John Providence Health System . . . . . . . . . . . . . 3
Saline Lectronics . . . . . . . . . . . . . . . . . . . . . . . . . 11
Southfield Town Center . . . . . . . . . . . . . . . . . . . . . . 1
University of Michigan . . . . . . . . . . . . . . . . . 1, 3, 26
Varsity News Network . . . . . . . . . . . . . . . . . . . . . . . 6
Visteon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Department index
JOHN SOBCZAK
“We have a
medical team
that is trained to
work together to
help our
patients,” said
Carlos Ramirez,
M.D., of St. John
Macomb’s new
microvascular
surgery program.
BANKRUPTCIES . . . . . . . . . . . . . . . . . 19
BUSINESS DIARY . . . . . . . . . . . . . . . . 22
CALENDAR . . . . . . . . . . . . . . . . . . . . 23
CAPITOL BRIEFINGS. . . . . . . . . . . . . . 18
CLASSIFIED ADS . . . . . . . . . . . . . . . . 25
KEITH CRAIN . . . . . . . . . . . . . . . . . . . . 8
LETTERS . . . . . . . . . . . . . . . . . . . . . . . 8
MARY KRAMER . . . . . . . . . . . . . . . . . . 8
OPINION . . . . . . . . . . . . . . . . . . . . . . . 8
PEOPLE . . . . . . . . . . . . . . . . . . . . . . 24
THIS WEEK @
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RUMBLINGS . . . . . . . . . . . . . . . . . . . 30
WEEK ON THE WEB . . . . . . . . . . . . . . 30
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November 18, 2013
Rizzo, Advanced Disposal to divide zones for city waste collection
BY CHAD HALCOM
Sterling Heights-based Rizzo Environmental Services Inc. and Ponte
Vedra, Fla.-based Advanced Disposal Inc. are on the hunt for new people and equipment to carry out a
new five-year Detroit municipal
waste hauling contract to be finalized in the next few weeks.
Rizzo, which has contracts with
about 30 communities in Southeast Michigan, and Advanced Disposal, which operates the Arbor
Hills landfill in Northville and
three transfer stations in Wayne
and Oakland counties, were the
winning bidders among seven
companies.
They will handle solid waste collection and single-stream recycling in four zones of the city, Detroit Emergency Manager Kevyn
Orr
announced
through
a
spokesman late last week.
The two contractors will divide
the city’s estimated 247,000 residences about equally by east and
west starting in March. Rizzo will
be the waste collector in Zones III
and IV, which cover the northeast
side and the area between I-94 and
the Detroit riverfront, while Advanced Disposal has Zones I and II,
or from the northwest side to
Woodward Avenue north of I-94.
Chuck Rizzo, president and CEO
of Rizzo Environmental, said his
company expects to manage its
zones for about $10.5 million to
$11 million per year, but contract
details are still being finalized. He
also expects to purchase about 40
vehicles and hire at least 50 new
employees to take on the added
workload.
Taken together, the city estimates the two companies will cost
between $23 million and $25 million per year and save the city
about $6 million per year, compared with its current cost for employees of the Department of Pub-
We are absolutely going to
“
need all new vehicles ... (and)
employ quite a few people.
”
Chuck Rizzo, Rizzo Environmental Services
lic Works to collect waste and send
it to the Detroit Renewable Energy
LLC waste-to-energy plant.
“We’re absolutely going to need
all new vehicles for this particular
contract, and we have to employ
quite a few people,” Rizzo said.
“We’ve been doing so many of
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these transitions lately, to add new
services for local communities,
that it shouldn’t be a problem to
carry out. And Detroit, in my opinion, seems to be doing everything
on this contract in (concern for)
what benefits the community.”
Mary O’Brien, chief marketing
officer for Advanced Disposal, did
not return two phone calls seeking
comment last week.
“With this contract, the city is
saving millions and improving
services at the same time; this is a
win-win for everyone,” Detroit
city COO Gary Brown said in a
statement Thursday.
The two companies are expected
to handle weekly trash collection
before 5 p.m. for residential customers and add single-stream
curbside recycling — a new service not currently offered to most
city residents.
Rizzo said it’s not immediately
clear if the finalized contract will
require the two companies to continue shipping all solid waste to
the waste energy plant, also
known as the Detroit incinerator.
He said the city, through the
Greater Detroit Resource Recovery
Authority, will continue to pay for
waste disposal on its own, separately from its collection and recycling contracts with the two hauling companies.
Detroit Renewable Energy subsidiary Detroit Renewable Power,
owners of the incinerator, currently receives a $25 tonnage fee to collect the waste, and Orr spokesman
Bill Nowling has said the city
hopes to achieve savings in part by
paying a more competitive rate
that some other customers pay.
John O’Sullivan, president of
Detroit Renewable Power, said
Thursday the company has not
had any discussions with either
company about future arrangements for Detroit waste collection.
The company is in talks with other
potential new customers, he said,
that could help offset any losses
from reduced Detroit volume.
The two companies must also
handle biweekly bulk trash disposal, previously a quarterly service
within DPW, and extend job offers
to DPW employees whose positions will be eliminated when the
contract takes effect.
The city also plans to sell its
fleet of garbage trucks to fund a
campaign to clean up some of the
worst cases of illegal dumping activity in Detroit neighborhoods
and school zones.
The review committee —
Brown, a representative from
Orr’s office, DPW director Ron
Brundidge, the city purchasing director and a representative of the
Greater Detroit Resource Recovery Authority — evaluated bidders
on a 100-point sourcing process
based on capacity to serve, experience on similar projects and basic
service cost.
Chad Halcom: (313) 446-6796,
[email protected].
Twitter:
@chadhalcom
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November 18, 2013
Carlyle Group exec: Low-cost energy will spur U.S. manufacturing
BY TOM HENDERSON
Cheap domestic natural gas supplies will lead to a rebirth of American manufacturing, according to
a presentation Thursday by
William Conway Jr., co-CEO and
managing director of the Washington, D.C.-based Carlyle Group.
Conway was the keynote speaker at the Crain’s Forum for Institutional Investors at the Westin Book
Cadillac in downtown Detroit, held
in conjunction with the Michigan
Economic Development Corp. and the
fourth annual Accelerate Michigan Innovation business plan com-
petition. (See winner, this page.)
The Carlyle Group is one of the
largest private equity companies
in the world, with 122 active investment funds and $185 billion
under management.
“Shale has changed everything.
We can use this cheap energy to
make a more energy-efficient
America,” said Conway, who recommended investing in companies
that provide supplies, such as
pipelines, to the natural gas industry, as well as companies that use a
lot of energy, since lower costs of
operation will lead to improvements in the bottom line.
A lot of those companies are ma-
jor manufacturers, he said.
“The U.S. has a huge advantage
over the rest of the world, including China, because of cheap energy costs. And those costs can be
sustained. The reindustrialization
of America will give us a competitive advantage for a long time,”
Conway said.
Despite his long-term optimism
in U.S. investment opportunities
— he likes health care services and
medical devices — Conway said it
is a good time to sell U.S. equities
and take some money off the table,
given the long, steep run-up on all
the major stock indexes.
Conway also discussed the con-
tinuing low interest rate environment, changing views on emerging
markets and other investment opportunities.
Conway said low interest rates
had been a boon for Carlyle — “we
borrow a lot of money” — but that
the jury was still out on its overall
impact. Either way, he said, they
are here for a while, given a report
last week by the U.S. Federal Reserve Bank that said it anticipates
keeping interest rates near zero
through the middle of 2017.
Conway said markets generally
believe the Fed will begin raising
interest rates before then as the
economy improves.
“No one is smarter than the
market, and the market thinks interest rates are going to go up a lot
sooner than that,” he said.
Rising interest rates will mean
“emerging markets will struggle
in the short term, but they’re still a
great place to invest long-term,” he
said, especially given the historically low government bond prices
around the world, with some government bonds, including German
and Japanese, paying less than 1
percent.
Tom Henderson: (313) 446-0337,
[email protected]. Twitter:
@tomhenderson2
GR website wins
first prize in biz
plan competition
My crazy dream is the reason.
In business, it’s perfectly acceptable to take a risk on a
big idea. Thankfully, you don’t have to take the same risk
on your employee health coverage.
GROUP HEALTH PLANS
|
DENTAL
|
VISION
|
bcbsm.com/employers
Blue Cross Blue Shield of Michigan and Blue Care Network are nonprofit corporations and independent licensees of the Blue Cross and Blue Shield Association.
Varsity News Network, a Grand
Rapids-based website that posts
news and photos of high school
athletic events, was the first-place
winner of $500,000 at the fourth annual Accelerate Michigan Innovation competition Thursday night
at Orchestra Hall in Detroit.
Varsity News, which has raised
$2 million in equity capital and
surpassed $100,000 in monthly revenue from operations in 13 states,
beat nine other finalists, which
had been whittled from 51 semifinalists in a series of business plan
pitches Wednesday and Thursday
at the Westin Book Cadillac Detroit.
Ann Arbor-based Covaron Advanced Materials Inc. won $100,000
as runner-up. The company, which
won $25,000 at last year’s Accelerate Michigan event, has developed
a process for making high-performance ceramics at far lower temperatures than traditional manufacturing, reducing energy costs
and production time.
REL Inc., Calumet, received
$50,000 for finishing third. The
company uses advanced materials
to make lightweight rotors for motorcycles and electric vehicles.
Eight companies won $25,000
each for having the best business
plan in various industries. They
were Inmatech Inc., Ann Arbor;
Wave Aircraft Inc., Birmingham;
LiteBrake Tech LLC, Hancock; PlanReaction LLC, Ann Arbor; AutoBike
Inc., Detroit; ENT Biotech Solutions
LLC, Detroit; Pindrop Inc., Boulder,
Colo.; and CureLauncher Corp.,
Bloomfield Hills.
Winning $10,000 as the winner of
the People’s Choice Award, based
on ballots filled out by audience
members, was Ann Arbor-based
TurtleCell LLC, which has designed
a protective case for smartphones
that has a retractable built-in set of
headphones.
Other finalists were Blaze Medical Devices, Ann Arbor, which has
developed a system for monitoring
the quality of blood being stored
for transfusion; First Sense Medical
LLC, Pontiac, which plans to begin
trials on a medical device that uses
thermal imaging to improve
breast-cancer detection; and Upland Nanotech LLC, Houghton, a
maker of sensors to detect foodborne pathogens.
— Tom Henderson
20131118-NEWS--0008,0009-NAT-CCI-CD_--
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5:49 PM
Page 1
Page 8
November 18, 2013
MARY KRAMER
OPINION
Turn an ear to what OU case a workplace lesson
Judge Rhodes says
S
top filing frivolous lawsuits!
That was U.S. Bankruptcy Judge Steven Rhodes’
admonition to Frequent Litigator Robert Davis and his
attorney last week.
Couldn’t have put it better ourselves.
Rhodes had issued an automatic stay that protects the city
of Detroit from lawsuits during the proceedings in his court.
The Free Press reported that Rhodes told the attorney for
Davis that his client risked sanctions for violating the automatic stay “if he continues to pursue lawsuits that are not allowed to proceed.”
The judge seemed irked when attorney Andrew Paterson
said Davis might sue over other actions, including the appointment of Police Chief James Craig.
Rhodes is expected to rule soon on whether the city is eligible for bankruptcy. If he accepts the labor union claims that
the city is ineligible, a holy mess will transpire.
Last week, media reports noted, too, that Rhodes may have
signaled his thinking when he wrote in an order suspending a
lawsuit challenging Kevyn Orr’s status as emergency manager: “The public ... has an interest in the opportunity that this
bankruptcy case may provide for the city of Detroit, not only to
adjust its debt and to restore the basic services that its residents need for their health and safety but also to regenerate its
economic livelihood.”
Well said.
There’s something
to be said for going
quietly.
But that’s not the
path Beckie Francis
has chosen.
Francis, fired as
coach of the Oakland
University women’s
basketball team on
June 12, had gone to
court to get an
unredacted copy of
the university’s internal report that led to her firing.
She won, kind of. A judge ruled
last week that the university
should supply Francis with a more
complete version, but some information, including names of students interviewed about her, may
still be blacked out.
Yes, this is a juicy scandal, particularly because Francis is married to Gary Russi, who retired unexpectedly as OU’s longtime
president just two hours before the
dismissal of Francis was made
public.
But it’s also a case study that
employers — public and private —
child by her father, now deceased,
after Penn State’s Jerry Sandusky
scandal broke open.
She lobbied state lawmakers to
adopt “Erin’s Law,” which allows
local school boards to come up
with age-appropriate ways to educate young children, K-5, about
how to recognize sexual abuse and
report it.
There are no winners in this OU
case.
One news account last week
quoted an email from Francis to
OU’s general counsel that explained: “I have high standards
and expectations, not all studentathletes can perform to those.”
Maybe OU has a standard and
expectation for its coaches, too:
Thou shalt not bully or abuse student athletes.
Mary Kramer is publisher of
Crain's Detroit Business. Catch her
take on business news at 6:10 a.m.
Mondays on the Paul W. Smith show
on WJR AM 760 and in her blog at
www.crainsdetroit.com/kramer.
E-mail her at [email protected].
LETTERS
Sebelius takes tour to Detroit
The pools among politicos and analysts are likely laying
odds and taking bets on when Kathleen Sebelius resigns.
Sebelius, secretary of the U.S. Department of Health and
Human Services, was in Detroit last Friday to serve as Cheerleader-in-Chief on the rollout of the Affordable Care Act at a
media event in Southwest Detroit.
Maybe she made time to meet with the folks at Covisint Corp.
We reported Oct. 28 that the local IT company, which has a track
record in building complicated exchanges linking multiple automotive supplier companies to customers, had offered to help.
Last week, federal officials said that just over 100,000 people nationwide — and 1,300 in Michigan — had signed up for
health care coverage through the troubled website. That is far,
far short of the millions projected to sign by year’s end. Estimates of exchange-eligible Michiganders range from 127,000 to
365,000 people. So a long way to go.
Which means that if the Tea Party had wanted to make a
philosophical point, they could have saved the ammo squandered in the drama of their ill-fated government shutdown and
just waited for healthcare.gov to launch.
might ponder. Issues include: How to handle the
inevitable
conflict-ofinterest situations that
arise when a top executive is married to another executive, with even
higher rank? Would allegations have surfaced
and been dealt with earlier if she were not married to the college prez?
The university, which
must have handled this
case with kid gloves, said it fired
Francis after finding evidence that
she was emotionally and mentally
abusive to players and she had
also not refrained, after warnings,
from a pattern of proselytizing
players with her own religious beliefs in a kind of “pray to play”
practice.
It is ironic that Francis, a publicly declared victim of sexual
abuse, appears to have inflicted
another form of abuse on young
women.
Francis told reporters in 2012
that she was moved to go public
about being sexually abused as a
County must do due diligence on jail
Editor:
I write in response to the Crain’s
editorial on Nov. 4 titled “County
mulls wrong questions on jail site”
questioning the Wayne County
Commission’s attempt to learn details about the Wayne County jail
fiasco before voting on any new
proposal. One simple question
comes to mind: What board of directors of any business, after incurring a $150 million loss on a
specific project, would then rush
to do a similar deal without doing
due diligence?
If Ford Motor Co. (Penske,
Quicken Loans, you name the local company) lost $150 million on a
plant development deal, wouldn’t
Crain’s Detroit Business
welcomes letters to the editor.
All letters will be considered for
publication, provided they are
signed and do not defame
individuals or organizations.
Letters may be edited for length
and clarity.
Write: Editor, Crain’s Detroit
Business, 1155 Gratiot Ave.,
Detroit, MI 48207-2997.
Email: [email protected]
its stockholders expect the board
or upper management to review
what happened to avoid a similar
fiasco? Where, as here, the new
deal is done by the exact same per-
sonnel — Bob Ficano’s staff — who
did the past horrific deal, doesn’t
due diligence and common sense
require the County Commission to
not only consider the new deal but
also review what went wrong in
the past to avoid the same mistakes in the future?
When the new jail proposal was
offered by the Ficano administration in 2011, Ficano asked the
Wayne County Commission to approve the deal on a sparse, onepage term sheet. I refused to vote
for the deal because we had no details; unfortunately, only Commissioner Tim Killeen joined me
See Letters, Page 9
KEITH CRAIN: The First Amendment is a very good thing
Crain’s Detroit Business has a
policy that forbids anonymously
written letters to the editor. They
have to be signed. Sometimes we
choose excerpted pseudonymous
comments posted on our website to
represent reaction to our online
stories.
But on the whole, we shy away
from letting anyone be anonymous. And that goes for any advertising we run as well.
When you read my column, you
know I wrote it. Our editorials on
our Opinion page, though unsigned, are the collective opinion
of the people running
this publication. You
know we are behind
them.
So when I heard that
Michigan Secretary of
State Ruth Johnson will
require public disclosure of who pays for political “issue” ads, I
wondered: Who could
object?
Some lawmakers do.
Johnson’s move was a change in
rules she controls. But some lawmakers want to quickly pass a bill
that would make her
rule apply only to ads
about candidates, not
about issues.
But issue advertising
is where the money is
pouring in. These are the
ads that urge voters to
“contact” a specific candidate about an issue.
If you want to tell me
about a candidate or an
issue on television, radio or in print, go ahead. That’s
your right. But don’t hide behind
an anonymous group that will
keep me guessing about who you
are and where you are coming
from. Please don’t use some silly
name that completely masks your
group’s identity.
If you are a division of the Communist Party, I want to know. I
think we all have a right to know.
So don’t run a disclaimer that tells
me that these funds were from the
Silly States Rights Commission.
The
Michigan
Legislature
should support Johnson’s idea, not
derail it.
Like Christmas marketing,
which now seems to start some-
where a little after Labor Day, we
are going to be inundated with political advertising for next fall’s
election after the first of the year.
We’ve got every member of the
U.S. House running, an empty U.S.
Senate seat, a governor’s race and
contests in the state Legislature.
It’s going to be tough to hear an ad
that’s not political.
The Legislature should support
Johnson. Let’s make all political
ads — for candidates and issues —
be transparent so we know who’s
paying the advertising tab. That’s
a bill the governor should sign.
20131118-NEWS--0009-NAT-CCI-CD_--
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12:02 PM
Page 1
November 18, 2013
TALK ON THE WEB
LETTERS CONTINUED
■ From Page 8
in requiring more due diligence,
as 13 other commissioners voted
for the flawed deal.
At the time, Commissioner
Killeen and I were mocked for not
voting for a deal that was a “nobrainer.” As of today, the Ficano
administration still has not presented us the new proposal, yet
wanted us to vote to approve the
deal Nov. 7. This time around,
shouldn’t the people of Wayne
County expect more due diligence
by their “board of directors”?
I applaud the ingenuity and energy of Dan Gilbert, Matt Cullen
and the Quicken team as they assist in rebuilding Detroit.
Nonetheless, I recognize they did
not build a hugely successful enterprise by being charitable.
The Wayne County Commission has a duty to review any new
jail deal and consider not only
price and cost but also a variety of
other options. For instance, in
2011, when the jail fiasco first
came to a vote, I was in favor of
considering the Ryan facility. I
am open to that option now. However, I also understand the support of many police officers,
judges and others for a central jail
downtown. (And, by the way,
Manhattan property values are
not impacted by the presence of
four jails on Manhattan.)
It is disconcerting for Crain’s to
urge the Wayne County Commission to abandon due diligence,
“hurry up” and do the deal. Without looking at the numbers,
Crain’s assumes it is a “no brainer.” Not very business-like, is it?
Laura Cox
Page 9
to flesh out the boundaries of the
ACA.
Under this definition, pregnancy can be considered a disease,
perhaps the only one for which
people throw parties, also known
as “showers.”
We can’t give our moral sanction to activities we believe to be
immoral. The result is that we no
longer offer health insurance as a
benefit. That wasn’t a result we
wanted, but we can’t allow our
feelings for our employees to be
used as a bludgeon against our
principles.
Ron Ezell
Ezell Supply
Royal Oak
Re: Retired Detroit police chief,
ex-state rep to co-chair Duggan team
A journey of a thousand miles
begins with one step. This seems
like a good first step.
Timothy Dinan
Re: A deer tale: Fondly remembered
destination has hopes for a new life
Please, whatever you do, do not
let these people open Deer Forest.
Who knows what they will do to
them next?
Dori Maschke
No one is perfect here, I’m sure,
so why don’t we just let the proper
authorities do their jobs and see
what transpires next year when
the park should be reopening?
Stop throwing stones. This park
was spectacular for years, and
maybe one day it will come back
and be good for the animals and
the visitors.
Guest
of the story.
I give all the credit in the world
to Mr. Gilbert and his associates.
But concentrating the renewal in
a small area is just a start.
Freedom Trinity
Re: NPR: A billionaire helps his
‘battered hometown’
If I have a headache, I take an
aspirin. If it persists, I realize it
may be a more serious event; I
want to see a doctor. Nurses are
great, I’m not degrading them in
any manner. However, I rarely go
to a doctor, and when I do I know
I’m sick — I want to see a doctor.
Amfer Ferg
Get out of the downtown area
and tell us all how “magical” and
what a “playground” Detroit is, if
you’d be so kind, NPR. When you
cannot provide visuals to an aural
fantasy, you only provide a portion
Re: Divided Michigan Senate votes
to expand nurses’ role
Wayne County Commissioner, 9th District
ACA violates biz
owners’ moral values
Editor:
My wife and I own a small business, which we started in 1992.
We have offered a variety of benefits, including health insurance,
to our employees during that
time. The fact that we are
Catholic was never an issue until
the Affordable Care Act was
passed.
We were then put in the position of choosing between our
moral values and our concern for
our employees. We believe abortion and artificial contraception,
including the morning-after pill,
are wrong and refuse to fund
them.
We don’t tell other people how
to live their lives or spend their
money, so our “corner office” has
never been used as a pulpit. That
isn’t true of the federal government in general or the ACA in
particular.
We explored ways with our insurance broker to reconcile our
beliefs with our concern for our
employees. We were told that under the provisions of the ACA,
pregnancy is a condition for
which preventive care such as
contraception and sterilization
would be covered under health insurance policies. This was a
guideline issued by U.S. Department of Health and Human Services, which was given the power
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20131118-NEWS--0010-NAT-CCI-CD_--
11/15/2013
11:02 AM
Page 1
Page 10
November 18, 2013
Snyder to address energy choice; backers, opponents keep up debate
BY JAY GREENE
In December, Gov. Rick Snyder
is scheduled to give his annual energy speech in which he is expected to address the highly charged
energy choice issue. He has said
his policy recommendations will
be based on reliability, pricing and
a protected environment.
Last year, Snyder ordered the
Michigan Public Service Commission
and Michigan Energy Office to conduct hearings and issue reports in
four areas: customer choice, renewable energy, efficiency and
other areas, including the reasons
why Michigan has higher rates
than other states.
Besides potentially taking a position on customer choice, Snyder
is expected to issue recommendations on whether to increase the
state’s renewable energy standards beyond the current 10 percent of power generation and
whether to continue or increase
the state’s successful gas and electricity efficiency targets.
John Quackenbush, chairman
of the Public Service Commission,
said the commission’s draft report
last month on energy choice was
carefully worded to “fairly present
the areas where there is a difference of opinion.” A final report on
energy choice is due Wednesday.
“We received many comments”
on the choice report “and tried to
just lay the facts out” without offering recommendations on what
“People shop for electricity
Public Act 286. The coalition represents DTE, Consumers, several when they feel pinched,” Kuipers
said. “They
chambers of comare not going
merce, small business
to go through
groups and some
the effort to
trade unions.
change their
“For every
supplier
if
10 percent of
they feel they
people you alare
getting
low to leave
fair prices.”
on
choice,
Transeth
that increases
agreed Michicosts
about
gan’s electric$300 million
ity prices are
for
people
higher than
staying on the
they should
system,”
said
be. “We have
Transeth, a PSC commissioner from 2007 to Wayne Kuipers, Energy Choice Now to find ways
to bring those
2010.
“We have handled the existing rates in line,” he said. “The answer
10 percent choice and can work is not more choice.”
with the 10 percent cap” in the future, he said. “We are saying, ‘If
you do anything, don’t go to full
deregulation.’ ”
Over the past several years,
Transeth said chaos would en- Michigan electricity rates for
sue and customers, in the long run, businesses have been about 5 perwould suffer from a less depend- cent higher than national averable system and higher prices.
ages. For residential customers,
But Kuipers said business cus- average rates have been about 10
tomers now are paying for higher percent to 15 percent higher, enrates than necessary. “The longer ergy experts said.
we wait, the more business will
However, because of climate and
leave Michigan or not come here at efficiency factors, DTE officials
all,” he said. “We are losing 21,000 have said residential bills in
jobs per year based on what we Southeast Michigan are about 30
ought to be paying for electricity.”
percent lower than national averKuipers said full competition ages. No average data was availdoesn’t have to mean DTE and Con- able for commercial and industrial
sumers lose customers or market bills, DTE said.
share.
But Michigan’s average prices
for electricity have increased over
the past two years and are above the
national average and the highest
among four other Midwest states —
Indiana, Illinois, Ohio and Wisconsin, according to U.S. Energy Information Administration. For example, between August 2012 and August
2013, the average retail price of
electricity for Michigan’s commercial customers rose to 11.46 cents
per kilowatt hour from 11.07 cents
per kilowatt hour, said USEIA.
Industrial customers rose to 8.23
cents per kilowatt hour from 7.98
cents per kilowatt hour, USEIA
said. Residential customers went
from 14.54 cents per kilowatt hour
to 14.98 cents per kilowatt hour, a 3
percent increase, the USEIA said.
Transeth said he expects state
legislators to start holding hearings
next year to look at ways to reduce
electricity costs. “We need to look at
new rate structures and rate designs” that lower costs for businesses, he said. “The way we generate
and use energy will look very different tomorrow than today.”
Kuipers said Energy Choice
Now is working with an unidentified legislator to write a bill that
will either increase the 10 percent
cap or eliminate it entirely.
Crain’s has been told the legislator
is Rep. Mike Shirkey, R-Clarklake.
Shirkey said he has not introduced the bill, but is planning to so
he can begin to force the debate on
whether Michigan should have a
fully deregulated electric market or
go back to a more regulated frameCELEBRATING
work. The hybrid model Michigan
has is not working, he said.
“Right now, Michigan ratepayers are enjoying the worst of both
systems,” he said.
Kalamazoo ■ Grand Haven ■ Lansing
Jay Greene: (313) 446-0325,
[email protected].
Twitter:
@jaybgreene
to do about the 10 percent when it vestments needed.
Increasing the cap could also
expires in late 2015, said Quackenworsen serbush. “We will get recvice reliabilommendations (for
ity as inlegislation) from the
vestors shy
governor.”
away, said
The report
Steve
issued this inTranseth,
teresting tidpolicy direcbit: If the
tor for Michi10,000 mostly
gan Jobs & Enbusiness cusergy Coalition,
tomers in line
which reprewere allowed
sents
the
to choose an
utility comalternative
panies and
electricity provider,
supports the
“choice participation
current regwould be approxiulatory
mately 25 percent for
Steve Transeth, Michigan Jobs &
scheme.
Consumers and 21
Energy Coalition
On the othpercent for DTE.”
er hand, supporters of increasing
or eliminating the cap in Michigan’s hybrid energy market — one
The 5-year-old cap on the num- in which 90 percent is regulated
ber of business customers that can and 10 percent is open for competipurchase lower-priced electricity tion — contend full deregulation
from the state’s 24 licensed alter- would force utilities to reduce
native electric providers has pro- rates to keep customers and market share.
voked ongoing debate.
Moving to full competition in
Opponents of eliminating or increasing the 10 percent customer the energy market would save
choice cap, which include DTE Ener- businesses money and lead to
gy Co. and Consumers Energy Co., higher job growth, said Wayne
say moving to a competitive or Kuipers, executive director of Enerderegulated market could reduce gy Choice Now, a coalition of concapital investments needed to ex- sumers, businesses and alternapand generation capacity or delay tive energy suppliers.
Transeth said his coalition supimprovements to aging distribution infrastructure. The reason: ports a continuation of the 10 perfewer customers to support the in- cent cap that was part of 2008’s
every 10
“ Forpercent
you
allow to leave
on choice, that
increases costs
... for people
staying on the
system.
”
Moving the cap?
longer we
“ The
wait, the more
business will
leave
Michigan or
not come here
at all.
”
Above the average
Congratulations,
Michael Romaya!
Honored by Michigan Lawyers
Weekly as one of the 2013
Up & Coming Lawyers.
■ Represents lenders and borrowers
in a wide variety of commercial
financial transactions.
125 Y E A R S
■ Blends legal knowledge and business
foresight when serving clients.
■ In Your Corner.
Michael J. Romaya [email protected]
■
Metro Detroit
■
Grand Rapids
■
20131118-NEWS--0011,0012-NAT-CCI-CD_--
11/15/2013
11:04 AM
Page 1
November 18, 2013
Page 11
PATENT TROLLS ON THE LOOSE
Second-stage companies are
targeted, Page 13
growing small businesses
EDITOR’S NOTEBOOK
Amy Haimerl is
entrepreneurship
editor. She can be
reached at (313)
446-0416 or at
ahaimerl
@crain.com
Amy Haimerl
5 steps to a
strategic plan
Adapt or die, right?
But when you’re facing the brink —
be it slowing sales, a crowded market
or even a failing business — it’s
daunting to think about creating new
products or entering markets to build
a future.
“Many entrepreneurs know the
potential of other markets, but they
just can’t reach them because they
don’t have the capital or other
resources,” said Ken Dalto, local
turnaround agent who owns
Farmington Hills-based Kenneth J.
Dalto & Associates.
To help clients solve the
conundrum, he asks them five
questions that inform a strategic plan.
䡲 Who is your market? “You have to
do research on the market you are
intending to penetrate. Is this a
market that is there or does it have to
be created? An iPhone market had to
be created.”
䡲 What is your product or service?
“Know exactly what you are offering. Is
it new product that people have to be
educated about, or is it something
everybody knows but you are
delivering it in a different way?”
䡲 How will you penetrate the
market? “What are your tactics? This
is essentially the marketing plan.”
䡲 Why can you succeed? “What is
your competitive advantage? What is
your differentiation? Is it pricing, look,
technological capability? Is it that
you’ve pinpointed the market in a
more detailed way?
䡲 Who is your real competition?
“Everybody has competition. Be
honest about it.”
Once Dalto has the answers and a
plan, he drops the bad news. “You
have to be prepared to not make
money for a while,” he said. “Plainly
and bluntly. You have to be able to
project a year or two that you may not
make money at this thing because you
may not have the volume.”
For Saline-based Saline Lectronics,
it took three years before it got all the
necessary certifications and its new
markets paid off.
Dalto would advise Saline President
Mario Sciberras not to get
complacent. A strong leader must
always be looking to the future.
“The CEO has to constantly be
thinking five or six years ahead,” Dalto
said. “If nobody is looking toward the
future, you are going to fail. Google,
Apple, they are thinking 20 years
ahead.”
ROBERT CHASE
After he and two other investors bought Saline Lectronics Inc., which was heading for bankruptcy in 2002, Mario Sciberras set about turning the company
away from the automotive industry and pointing it toward two more promising areas: medical devices and aerospace.
Technical turnaround
Saline Lectronics picks up new specialized skills to fashion a comeback
BY GARY ANGLEBRANDT
SPECIAL TO CRAIN’S DETROIT BUSINESS
hese days, it’s not uncommon for
prospective customers to call Saline Lectronics Inc., having heard that the
Saline-based contract manufacturer has
the equipment and track record to do the
job.
In the past year alone, the company’s
revenue grew from $23 million to $35 million as clients flocked to the firm for its
electronic assemblies.
But it wasn’t always this easy.
In 2002, the company was nearing
bankruptcy. It worked solely for the automotive industry and had just $2.5 million
in revenue. But Mario Sciberras, who
was consulting with the firm, and two of
the company’s existing investors saw opportunity. They bought Saline Lectronics
and put Sciberras in charge of the turnaround.
“It was upside down completely,” said
T
was upside down
“ Itcompletely.
”
Mario Sciberras, Saline Lectronics
Sciberras, now president.
He set about turning the company away
from the automotive industry — with its
tough margin squeezes, hardball tactics
and economic cycles — and pointed it toward two more promising industries:
medical devices and aerospace.
Sciberras knew that would mean cutting staff and spending boldly on new capital equipment to archive the quality standards and certifications demanded by
those industries.
It took Saline Lectronics three years
and $100,000 in consulting fees and related
expenses to finally secure the requisite
certifications. During that time, Sciberras
slowly built the business by picking up
small jobs, laying the groundwork for bigger contracts in the future.
Getting a track record was crucial because winning customers takes more than
just certifications and quality standards.
After all, if you’re the firm building such
products as black boxes on airplanes,
heart monitors and Lasik machines, you
want to be sure that the manufacturer of
your electronic assemblies can deliver.
Valuable skill set
Saline Lectronics also invested in its
inventory-management system — it handles about 30,000 very tiny parts on any
given day — and about $10 million in manufacturing equipment. The most significant investment was five automated
surface-mount assembly lines, which are
used to solder parts — some of which are
See Turnaround, Page 12
20131118-NEWS--0012-NAT-CCI-CD_--
11/15/2013
11:57 AM
Page 1
Page 12
November 18, 2013
Second Stage
Consistent contender ForeSee
wins Spark’s FastTrack award
done this in our third year.”
In 2013, ForeSee Results is projected to have revenue of $52 milFor seven years, ForeSee Results lion, according to Crain’s estihas grown its revenue by more mates, up from about $25 million
than 20 percent per year. This in 2009.
year, the customer-experience anJoining ForeSee Results are 10
alytics company saw better than 25
other firms that had at least $100,000
percent growth.
in
revenue
That’s made the
and posted 20
company the big winpercent
ner in Ann Arbor
growth annuSpark’s annually over the
al FastTrack
past
three
awards.
years. Making
For
the
the list are Arpast
seven
bormoon Softyears,
the
ware, Caelynx
nonprofit
LLC, CEI Comeconomic deposite
velopment orMaterials,
ganization
DreamMaker
has awarded WashteBath & Kitchen,
naw
County-based
Estrakon Inc.,
companies posting at
LLamasoft Inc.,
least 20 percent annuLarry Freed, ForSee Results
McCreadie
al growth. In all seven
Group Inc., Medyears, ForeSee has
Hub Inc., Online Tech and Oxford Cos.
been on the leader board.
“Washtenaw County is about
If Spark had started measuring
before that, ForeSee would have 330,000 people, so to have businessshown strong growth almost from es that are having 20 percent
its founding in 2001, said Larry growth rates, especially for seven
straight years like ForeSee, is pretFreed, president and CEO.
“We’ve really had solid growth ty remarkable,” said Paul Krutko,
every year we’ve been in busi- president and CEO of Ann Arbor
ness,” Freed said. “We could have Spark.
BY AMY HAIMERL
“
We’ve really had
solid growth
every year
we’ve been in
business. We
could have
(won) in our
third year.
”
Currently, ForeSee plans to
hire another 20 employees, bringing its staff roster to 350 across offices in Ann Arbor, New York
City, London, Sao Paulo, Atlanta,
Vancouver and Los Angeles.
“I have always been a big believer that the most important
thing for a company is talent,”
Freed said. “It’s also one of the big
challenges. There are lots of challenges, funding and all that, but
I’ve always been a believer that if
you have a great idea and can
build a team, you can find the
money.”
That meshes with Ann Arbor
Spark’s mission to build up the region around Ann Arbor as a great
place filled with great talent. The
public-private partnership between
local government, universities and
businesses is tasked with bringing
new firms to town and supporting
those that already exist.
“As early as July we were ahead
of where we were for the entire
2012 in terms of companies who
are making new capital investments, either expanding or coming
here for the first time,” Krutko
said. “We’ve seen a pickup in economic activity.”
Amy Haimerl: (313) 446-0416,
[email protected].
Twitter:
@haimerlad
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Turnaround: Lectronics
■ From Page 11
barely visible to the unassisted
jobs lead to real work.
eye — onto printed circuit
Saline does, with about nine
boards.
small-run jobs of a few hundred
The gambit started showing items under way each week. Afsigns of paying off in 2006, when ter all, it paid off big with AcSaline gained its first aerospace curi, which started out as a
customer, Parsippany, N.J.-based small-run client but became a
Curtiss Wright Corp. From there, significant client as it grew and
Saline spread into medical de- eventually was sold to Franklin
vices, securing a
Lakes, N.J.contract with Ann
based
BecArbor-based Accuri
ton, Dickinson
Cytometers Inc.
and Co. in
The
big
2011.
break into
Gibbons
usage-based
hopes
Hisinsurance
toSonics has
telematics
a similar suc— devices
cess with its
that
plug
product,
a
into cars’ dimachine that
agnostic
uses sound
ports
to
frequencies
track driver
to reduce the
habits — really
size
of
changed things.
prostates,
Novi-based Danlaw
and perhaps
Inc. wanted to bring
someday canits manufacturing
Christine Gibbons, HistoSonics
cer tumors.
back from China,
Saline
where it had some
makes
six
bad experiences, inelectronic
boards
that
go
into
cluding a “catastrophic issue”
that shut down production for six each machine. So far, HistoSonics
weeks, said Tom Rzeznik, presi- has needed only seven of the machines, which are still in an early
dent and COO.
Rzeznik was tired of the mid- clinical trial phase.
If all goes well, “we can talk
night Skype calls and travel expenses of dealing with a Chinese about bigger volumes three years
supplier, but proven companies down the road,” Gibbons said.
that can assemble telematics Such is the world of medical deboards aren’t just around every vice manufacturing.
Russell Jahnke, director of clincorner. It takes real specialty because the pieces in the devices are ical quality and regulatory, said
having someone local where Hisin fractions of a millimeter.
“It’s like shooting pieces of pep- toSonics’ engineers can walk the
per at the board and getting them floor of the plant, and be willing
to locate precisely on the board,” to take a chance on a new compaRzeznik said.
ny, was imperative.
Understanding the problem,
“We drove over, spent three
Vince Nystrom, vice president of hours with them, shook hands.
strategic accounts at the Michigan That was a big deal,” he said.
Economic Development Corp., introThe fact that HistoSonics apduced the two firms.
proached Saline is one of the hallIt didn’t take long for Danlaw to marks of a second stage company.
pull the trigger once it saw that In this phase, it’s easier to reach
Saline had the resources to do the new customers than in the startwork. In two months, the compa- up days, the reward for investnies went from a pilot run of 1,000 ments made early on.
units to full production.
It’s no longer about “just getSaline now produces 9,000 units ting one-off customers and that’s
a week for Danlaw and added a it,” said Gary Giallonardo, presisecond line to accommodate the dent of Industrial Visions Company
work. The company has grown LLC, a consultancy in Troy. Now
from 120 employees to 160 because it’s about building long-term relaof the entrance into telematics.
tionships, repeat business and the
It picked up other industries word getting out.
throughout the growth curve, and
Companies must continually
its industry mix now covers med- adapt and revise, he said — just as
ical device, aerospace, oil and gas,
Saline Lectronics did a decade
and automated controls.
ago and continues to do through
its small-run manufacturing.
Giallonardo shared the story of
A newer customer is HistoSon- one parts manufacturer where
ics Inc., a medical device startup the leaders didn’t understand that
they might have to actually leave
in Ann Arbor.
Christine Gibbons, president the office and meet their cusand COO, said she needed a man- tomers if they wanted to turn
ufacturer willing to do small pro- around the stagnant company.
“The president said, ‘That isn’t
totype runs years before the product has any chance of seeing big how we do things here’,” he said.
That firm was destined for
volumes.
That expectation is fairly stan- struggle and potential failure,
dard in electronics contract while Saline Lectronics, with its
manufacturing, but not all firms explosive growth, is poised to
perform the services because reach $40 million in revenue for
only a fraction of the small-run the current fiscal year.
goes well
“ (If allwith
a
product for
HistoSonics)
we can talk
about bigger
volumes three
years down the
road.
”
Business development
20131118-NEWS--0013-NAT-CCI-CD_--
11/15/2013
11:05 AM
Page 1
November 18, 2013
Page 13
Second Stage
Second-stage businesses being
pursued by menacing patent trolls
Brinks, Gilson & Lione. “Fighting
them is very, very expensive.”
The issue has become such a
Patent trolls have been a nui- trigger point for businesses that
sance to the large auto manufac- President Barack Obama talked
turers for years, but they are now about it during a Google Hangout
going after second-stage business- in February. He responded to a
es.
question on the issue by saying,
A recent study from Boston Uni- “The folks that you’re talking
versity’s School of Law found that about are a classic example; they
patent trolls cost U.S.
don’t actually
companies $29 billion
produce anyin 2011 and attack
thing themsmall and midsize
selves.
firms, typiThey’re just
cally with avtrying to eserage annual
sentially
revenue
of
leverage and
$10.8 million.
hijack some“Although
body
else’s
large firms
idea and see if
accrued over
they can exhalf of direct
tort
some
costs,” the remoney out of
port
said,
them.”
“most of the defenIt’s also set
dants were small or
off a wave of
medium-sized firms.”
federal
and
These trolls, which
Jim Cleland,
state legislaare officially known
Brinks, Gilson & Lione
tion as offias nonpracticing encials try to
tities, or NPEs, buy
solve the issue. Even the Supreme
up and hold patents for products Court is weighing in on the issue
and technologies they don’t intend by hearing a case this session —
to manufacture. Instead, they Highmark Inc. v. Allcare Manage“troll” for companies that might ment — that would make it easier
be infringing on their patents and for judges to award attorneys’ fees
demand steep licensing fees — or in patent troll litigation.
face lawsuits.
Another step is the America InAt issue is that so many patents vests Act, which went into effect
are issued each year — many of earlier this year. That legislation
them overlapping and vaguely allows businesses to, among other
worded — that it’s easy for an NPE things, challenge a patent and deto hold a patent for something as mand a review in the U.S. Patent &
overreaching as the “interactive Trademark Office. While that is hapWeb.”
pening, Cleland said, courts can
“In my roles in the mobile tech- place any litigation on hold, saving
nology industry, I work with com- defendants time and money in the
panies of all sizes that have fallen long run.
victim to patent trolls,” said
Wixom-based Hosco Fittings LLC
Elaina Farnsworth, CEO of Ply- successfully fought a patent troll
mouth-based Mobile Comply LLC. “I that alleged the paint-fittings manhave seen four businesses crip- ufacturer was listing products in
pled by the attacks of trolls, and its catalog that had expired
two fighting back that have lost patents.
investors and clients in the
The company could have been
process.”
fined $500 for every product sold
Even the Michigan Bankers Asso- with a mismarked or expired
ciation recently had one member patent, said Tom Murray, presihit by trolls, with the NPE de- dent of Hosco Fittings.
manding a licensing fee for use of
“Patent lawsuits happen freATM technologies.
quently in the manufacturing busi“This is very much a case of peo- ness,” Murray said. “We were sued
ple making demands that may or for wrongful marking of the patents
may not be legitimate,” said Dennis but were lucky to escape it.”
Koons, president and CEO of the
Michigan technology firms are
MBA. “Good, honest people are pur- also at risk because software
chasing these ATMs from reliable patents are particularly vulneravendors. A totally unrelated third ble. The Georgetown Law Journal
party shows up claiming to have found in 2011 that software patents
account for just 12 percent of all
patents and demanding money.”
That’s typically how it begins. A patents but comprise 74 percent of
patent troll will send a letter alleg- all patent litigation.
That prompted the Mobile Teching a company is infringing on its
patent and demanding settlement nology Association of Michigan to
or a licensing fee. These NPEs bet partner with the Application Develon the fact that the costs of litiga- opers Alliance to host a Detroit
tion will be too high and business- Patent Summit this past August.
“The worst thing a business can
es will just settle.
“Second-stage companies may do is ignore a letter received from
not have the funds to fight these a patent troll,” said Linda
cases,” said Jim Cleland, an attor- Daichendt of MTAM. “The second
ney in the Ann Arbor branch of worst thing they can do is agree to
BY AMANDA LEWAN
“ Second-stage
companies
may not have
the funds to
fight these
cases. (It) is
very, very
expensive.
”
their proposed
terms.”
How Michigan businesses
will
defend
themselves over
the next few
years will stem
from
the
Supreme Court
case and state
Daichendt
initiatives.
“NPE litigation is a major issue
right now that will affect business
in Michigan,” Cleland said. “It has
the attention of our Congress, our
president, numerous attorneys general offices around the country, and
certainly the attention of the legal
departments of most, if not all, large
companies in our state.”
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20131118-NEWS--0014-NAT-CCI-CD_--
Page 14
11/15/2013
11:08 AM
Page 1
November 18, 2013
Survey: Optimistic suppliers are
ready to make capital investments
BY DAVID SEDGWICK
CRAIN NEWS SERVICE
Automotive suppliers have been
content to let their plants run
around the clock rather than build
new factories or assembly lines to
meet high demand. Until now.
According to a September survey by the Troy-based Original
Equipment Suppliers Association, 84
percent of suppliers doing business
in North America said they are
somewhat or very confident that
their companies will make capital
investments in 2014 and 2015.
An additional 11 percent said
they were “slightly confident”
they would add capacity, and only
5 percent said they did not plan
any capital expenditures.
Survey respondents said they
were more willing to invest than
they were in July, when 66 percent
were planning for “significant” or
“somewhat increased” capital investments.
The upbeat survey comes at a
time when North American light
vehicle production is on course to
hit about 16.1 million units this
year, up from 15.5 million units in
2012, according to LMC Automotive,
a consulting firm based in Troy.
In 2014, North American vehicle
production is expected to rise 3
percent to 16.6 million units, LMC
said.
As demand rises, automakers
are planning to expand capacity in
years to come. According to a Morgan Stanley study, carmakers in
North America will add 864,000
units of capacity in 2014, plus
400,000 units in 2015.
So it comes as no surprise that
the OESA survey, which drew 85
BRICKS AND MORTAR
The Original Equipment Suppliers
Association asked its 450
members in September whether
they would make capital
investments in North America to
meet demand in 2014 and 2015.
Here’s what the 85 respondents
said:
Very confident
48%
Somewhat confident
36%
Slightly confident
11%
None planned
5%
responses from its 450 members,
showed suppliers at their most optimistic since January 2012.
Sixty-four percent said they had
grown either somewhat or significantly more optimistic about their
prospects for the next 12 months.
In July, only 44 percent of respondents were more optimistic.
The survey also suggests that
suppliers are struggling to keep up
with demand. One vendor reported that his company was “busting
at the seams,” while another said
“our growth plans continue to be
aggressive.”
Asked to identify their most
pressing needs, 29 respondents
said they were focusing on personnel issues, such as hiring more engineers, retaining employees and
attracting skilled trades. Fourteen
suppliers said capacity constraints
were their most serious challenge,
and 11 identified product launches
as their top concern.
Neil De Koker, CEO emeritus of
OESA, said in September that
North American automakers
couldn’t add any more workers to
existing assembly plants and now
must build new ones.
“Now it’s bricks and mortar,”
De Koker said.
At the time he was referring to
North American automakers. Now
it’s true for suppliers, too.
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20131118-NEWS--0015-NAT-CCI-CD_--
November 18, 2013
11/15/2013
11:09 AM
Page 1
Page 15
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BY KIRK PINHO
It took a $30 million redevelopment to transform a largely vacant
northwest Detroit apartment complex into one that is now fully occupied.
Novi-based Ginosko Development
Co. completed an 18-month redevelopment of the low-income Renaissance Village Apartments at Seven
Mile and Evergreen roads in May,
according to President Amin Irving.
But Ginosko didn’t simply
swoop in and redevelop the complex, formerly known as Evergreen Estates, the way it wanted.
Instead, Ginosko sought input
from the few residents who remained at Renaissance Village after years of disrepair, Irving said.
The complex had a 30 percent occupancy rate when Ginosko purchased it from the Michigan State
Housing Development Authority in
2011 for $3.95 million after the previous owner defaulted on a MSHDA loan. According to Chris LaGrand, chief housing investment
officer for MSHDA, the previous
owner was Ron Weaver Sr.
Every six weeks, Ginosko would
hold meetings with the residents
to learn about their needs and
wants.
“The residents that were there
knew the property better than I
did,” Irving said.
The result?
A reduction in the number of
units from 305 to 185 through the
demolition of buildings containing
60 units, and merging studio and
one-bedroom units to create an
apartment complex featuring only
two- and three-bedroom units
ranging in price from $500 to $700
per month. During the redevelopment, residents were moved into
vacant apartments while theirs
were renovated.
In place of the demolished buildings, a center courtyard was constructed with an amphitheater, fitness equipment, a splash pad and
other outdoor amenities.
Another result was 100 percent
occupancy.
“It sounds like their reconfiguration strategy was a good idea
and appropriate for the marketplace, which is seeing larger family units living together,” said Larry Goss, executive vice president
of Bingham Farms-based Core Partners Associates LLC, which is trying
to develop two low-income housing complexes in Oakland County.
“Generally, I think we still see a
strong demand for affordable
housing in our market, and in particular, rental housing. This is in
line with what the market is looking for and needs.”
The complex was built in the
1940s. The new construction began
in November 2011.
The project was financed with
an MSHDA tax-exempt first mortgage; U.S. Department of Housing and
Urban Development Neighborhood
Stabilization Program funds; city
of Detroit Home Investment Partnership Program funds; and state
brownfield tax incentives. The
A courtyard was
among the
amenities created
at Renaissance
Village Apartments
after developers
met with residents.
COURTESY RENAISSANCE VILLAGE
Shelby
Township
office
of
Muskegon-based Hooker Dejong Architects & Engineers was the architecture firm on the project. Kentwood-based Rohde Construction Inc.
did the construction. KMG Prestige
is the property management firm.
Renaissance Village brings Ginosko’s $116 million portfolio to 22
properties totaling more than 2,000
units, mostly in Michigan.
Among the company’s significant development projects are:
䡲 The redevelopment of the 71unit New Center Commons north of
West Grand Boulevard between
the M-10 Freeway and Woodward
Avenue.
䡲 The redevelopment of Mid-
town’s Coronado Building at the corner of Second and Selden streets
into 24 apartment units.
䡲 The redevelopment of the 76unit New Center Pavilion near West
Grand and the M-10 Freeway.
Renaissance Village’s location
has personal significance for Irving.
“My wife grew up in that area,
and my father-in-law has a dance
studio right down the street,” he
said. “It’s an area where there still
are thriving businesses and people. It is a community that, given
everything else, is still stable.”
Kirk Pinho: (313) 446-0412,
[email protected].
Twitter:
@kirkpinhoCDB
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20131118-NEWS--0016,0017-NAT-CCI-CD_--
11/15/2013
12:27 PM
Page 1
Page 16
November 18, 2013
Asian focus helps Visteon steady
financial ship; firm looks to invest
BY DUSTIN WALSH
After more than a decade of
struggles for profitability and a
flurry of management changes, Visteon Corp. has returned to steady financial performance as it weighs
its future.
Visteon, spun off from Ford Motor Co. in 2000, has tried to dispose
of lower-margin units to focus on
faster-growing Asian operations
after exiting bankruptcy in 2010.
Industry experts say Visteon
management is making the right
moves and speculate another M&A
move may be ripe within the next
year. In a nod to the shift to Asia,
the company is even weighing a
switch to being traded on the Hong
Kong exchange in lieu of the New
York Stock Exchange.
It remains unclear whether Visteon is in the position to buy or
will continue to divest businesses,
according to experts.
But Jim Fisher, director of corporate communications at Visteon, said the company plans to
grow its businesses, not sell them.
“We have two good core businesses now; they both have been growing rapidly,” Fisher said. “We’re
looking to invest in those businesses and grow them … we’re well-positioned to be a consolidator (not a
seller) in those businesses.”
Coming out of bankruptcy in
2010, Van Buren Township-based
Visteon faced an uphill battle
against investors under Don Stebbins, then chairman and CEO.
Boardroom turmoil led to Stebbins’ resignation in August 2012,
and board member Timothy Leuliette took over the reigns.
Leuliette’s first order of business was to cut costs and consolidate operations. The last six quarters have shown improvement; the
supplier posted net income of $43
million, or 85 cents per share, on
revenue of $1.73 billion for the
quarter that ended Sept. 30 — the
sixth in a row with profits. The
same quarter a year earlier, Visteon reported net income of $15
million, or 28 cents per share, on
revenue of $1.61 billion.
The company’s focus on Asia remained strong, with the Asian
market accounting for 45 percent
of its sales in the quarter. Korean
automaker Hyundai-Kia accounted
for 34 percent of Visteon’s thirdquarter revenue.
North America accounted for
roughly 20 percent of Visteon’s
business in the third quarter.
In January, Visteon announced
Halla Climate Control Corp. bought
its automotive climate units. Halla
Climate, the South Korea-based
maker of HVAC systems, in which
Visteon holds a 70 percent stake,
purchased the climate businesses
in countries including China, India, France, Netherlands, Mexico
and the United States, for about
$387 million.
Renamed Halla-Visteon Climate
Control Corp., the entity is led by a
Korean management team and
traded on the Korea Exchange.
In August, Visteon announced it
would sell its 50 percent stake in
interiors joint venture Yanfeng Visteon Automotive Trim Systems Co. to
China’s Huayu Automotive Systems
Co. for $1.25 billion.
Under Leuliette, the supplier
has made a strong push to Asia
and is exceeding Wall Street’s expectations, said Matthew Stover,
equity analyst for Guggenheim Securities LLC in Boston.
“When they came out of bankruptcy, I don’t know if people really understood the competitive position of the company or what the
long-term strategy was going to
be,” Stover said. “They’ve always
been leveraged to China and Asia,
but I think they’ve done a good job
of telling that story now.”
This year, Visteon has continued to pare down its management
team in Van Buren Township in
favor of representation in Asia.
Last week, the board terminated
Robert Pallash, senior vice president and president of its global
customer group, effective at the
end of the year.
The board of directors approved
the terminations of Joy Greenway,
president of its climate control
business, and Keith Shull, senior
vice president of human resources, in April following the sale
of its climate control business to
Halla Climate.
Visteon did not replace Greenway, and control of the business
was turned over to Yong-Hwan
Park, CEO of the renamed HallaVisteon Climate Control.
It’s unclear whether Pallash will
be replaced, locally or in Asia.
In September, Leuliette said Visteon is considering leaving the
NYSE to be traded in Hong Kong,
Bloomberg reported.
“In Asia, where the bulk of our
business is and the bulk of the automotive industry is, this is a
growth industry, but we’re not getting growth multiples,” Leuliette
told Bloomberg. “We need to start
being valued on where we do business, not where we’re domiciled.”
Those plans appear to be on hold
as the company continues to finalize the sale of its Yanfeng stake.
David Sowerby, portfolio manager in the Bloomfield Hills office
of Loomis Sayles & Co. LP, said the
moves have “right-sized” the company, and its
strong presence
in the growing
Asian market
has made it target-worthy on
the M&A market.
“Long-term,
Visteon has not
been a wealth
Sowerby
creator (for investors), but it’s wrung out costs,”
Sowerby said. “But there is opportunity, and this management team
is likely more motivated to sell
than other management teams.”
Leuliette has a history of driving
deals. He was hired on to lead
Rochester Hills-based supplier Dura
Systems LLC in 2008 after it emerged
from bankruptcy. He led its sale to
private investment firm Patriarch
Partners of New York in 2010.
However, in last week’s earnings call, Leuliette ruled out a sale
of its electronics unit.
“This is not a business for sale,
at all,” Leuliette said. “This is a
business that we’re going to grow.
… I mean, it’s a real value driver.”
But Stover said in a Nov. 8 analyst
note that Leuliette is playing coy.
The note said: “We believe that
management is endeavoring to focus investor attention here because it ultimately gives the company options. If the market simply
believes the company is going to
be broken up, then full value for
the assets will be difficult to assemble until the asset is sold.
“Conversely, if a potential buyer
understands that the company has
limited strategic options, then
they will be less willing to offer a
fair price for the asset.”
Dustin Walsh: (313) 446-6042,
[email protected].
Twitter:
@dustinpwalsh
Individuals, families, and business owners present
us with financial challenges and goals.
We respond with insightful guidance focused on
sustainable solutions that address today’s needs,
as well as the needs of the next generation.
)3
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20131118-NEWS--0017-NAT-CCI-CD_--
11/15/2013
11:33 AM
Page 1
November 18, 2013
Page 17
E XPERIENCE THE
SUITE LIFE
CRAIN’S SEEKS NOMINATIONS
FOR HEALTH CARE HEROES
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Crain’s Detroit Business is seeking
nominations for Health Care
Heroes, a special report on health
care professionals that will run in
the Feb. 17 issue.
The program will honor top-notch
medical innovators and patient
advocates.
Our winners will be chosen in five
categories:
䡲 Corporate achievement in
health care: Honors a company
that has created an innovative
health benefits plan or solved a
problem in health care
administration.
䡲 Advancements in health care:
Honors a company or individual
responsible for a discovery or
developing a new procedure,
device or service that can save
lives or improve quality of life.
䡲 Physician: Honors a physician
whose performance is considered
exemplary.
䡲 Allied health: Honors an
individual from nursing or allied
health fields who is deemed
exemplary by patients and peers.
䡲 Trustee: Honors leadership and
distinguished service on a health
care board.
A panel of health care judges will
choose the winners.
Nominations, which are due
Dec. 9, can be made at
crainsdetroit.com/nominate.
Statewide nominations accepted.
Questions? Contact Bill Shea at
[email protected] or (313) 4461626.
PLAN YOUR HOLIDAY PARTY TODAY
NOMINEES SOUGHT FOR
M&A AWARDS
Involved in a merger or acquisition
in 2013? You may be eligible for
Crain’s M&A Awards. Crain’s
Detroit Business and the
Association for
Corporate
Growth will
honor
companies and
individuals in
the following
categories:
䡲 Best Deal of
the Year: Under
$100 million and $100 million or
more. The deal must have closed
in 2013. The buyer or the business
sold must be in Wayne, Oakland,
Macomb, Washtenaw or Livingston
counties.
䡲 Dealmaker of the Year/buyerseller.
䡲 Dealmaker of the Year/adviser.
M&A experts, lenders, CPAs,
consultants and attorneys, among
others, are eligible.
Dealmaker candidates also must
be in Wayne, Oakland, Macomb
Washtenaw or Livingston counties.
Winners will be profiled in the
March 24 issue of Crain’s Detroit
Business and will be honored at an
awards event in May.
For questions concerning the
nomination process or the
nomination form, contact Amanda
Duque at (313) 446-6083 or
[email protected].
The deadline for nominations is
Jan. 13.
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20131118-NEWS--0018-NAT-CCI-CD_--
11/15/2013
11:14 AM
Page 1
Page 18
November 18, 2013
State Senate acts fast to halt issue-ads disclosure bill
It didn’t take long after Secretary
of State Ruth Johnson announced
last week that she was proposing a
new rule to require disclosure of
who is paying for election-season
issue ads for Senate Republicans to
effectively kill the idea.
It took all of about two hours.
Shortly before 9 a.m. Thursday,
Johnson announced her idea publicly and then spoke about it with
reporters on a conference call. Coinciding with her rollout, a Senate
committee hastily tacked an
amendment onto Senate Bill 661
that sought to continue to exempt
disclosure of donors that pay for
these issue ads. Not long after, the
full Senate approved the amended
bill by a narrow 20-18 vote.
Issue ads are used to encourage
or discourage voters to contact a
political candidate, but do not expressly advocate for the election of
a particular candidate. Under current law, those who pay for such
ads do not have to be disclosed.
Johnson’s rule would have allowed for that transparency, and
she said Gov. Rick Snyder told her
he supported the change.
Senate Majority Floor Leader
Arlan Meekhof, R-West Olive, said
the amendment simply codifies
the way things have been done and
said Snyder told him he supported
the amendment, which would
block the disclosure Johnson was
trying to allow.
Asked which story was right,
Snyder press secretary Sara Wurfel
said Snyder did not indicate to
Johnson one way or the other his
position on her proposed rule. Simi-
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larly,
she
said, Snyder
has not talked
with any lawmakers about
Meekhof’s
amendment,
and therefore
did not tell
anyone
he
supported it.
A case of
wishful listening?
Capitol
B r i e fi ng s
Chris Gautz
Quick trip for Court of Claims bill
Opponents of Senate Bill 652,
which moves the Court of Claims
from Ingham County to the Court
of Appeals, had many questions
about its effects. But they largely
went unanswered because the bill
sailed through the Legislature at
warp speed.
In fact, Snyder said there was already the need for a new piece of
legislation to ensure those suing
the state would not be denied the
right to a jury trial.
That bill, HB 5616, was introduced on Thursday and makes
clear in amending the law Snyder
just signed that there was no intent
to waive the right to trial by jury.
The need to fix it so quickly gave
Democrats one more reason to attack the bill and that way it was
pushed through.
The law, which takes effect immediately, takes the Court of
Claims out of the hands of the nine
judges from Ingham County,
which leans Democratic, and who
have ruled routinely against the
state and some of the high profile
laws approved by Republicans in
the Legislature.
Under the new law, the state
Supreme Court, which has the majority of justices nominated by the
Republican Party, was tasked with
selecting four Court of Appeals
judges from at least two of the appellate districts to serve as Court
of Claims judges. For each case to
come before the new Court of
Claims, there will then be a blind
draw among the four judges.
The Supreme Court muted some
of the criticism when it announced
it had unanimously chosen two
judges who were nominated by former Republican Gov. John Engler
and two nominated by former Democratic Gov. Jennifer Granholm.
Opponents had feared the high
court might have chosen four
judges nominated by Republican
governors.
While some of the partisan fears
over the law have subsided, there
are still questions over its jurisdiction because the law does not simply move the Court of Claims, but
it also expands its reach to “any
demand for monetary, equitable,
or declaratory relief.”
Opponents of the bill say this
means any case brought in a Circuit
Court regarding the Freedom of Information Act or the Open Meetings
Act, for example, would have to be
heard by the new Court of Claims,
rather than in the local circuit court
where the alleged offense occurred.
Litigation challenging the extent of the jurisdiction of the new
Court of Claims and attempts to
define its scope is expected.
Chris Gautz: (517) 403-4403,
[email protected].
Twitter:
@chrisgautz
20131118-NEWS--0019-NAT-CCI-CD_--
11/15/2013
12:03 PM
Page 1
November 18, 2013
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Baird Capital, a Chicago investment firm with more than $2.8 billion under management in its private equity and venture capital
funds, has hired veteran Ann Arbor
entrepreneur David Gregorka to
source deals throughout Michigan.
Gregorka was a co-founder in
1998, along with
now-Gov. Rick
Snyder and University of Michigan
professor
Victor Strecher,
of Ann Arborbased HealthMedia Inc., which
was sold to Johnson & Johnson in
Gregorka
2008.
Gregorka had various titles at
the company, including CFO and
vice president of operations.
Gregorka stayed on with Johnson & Johnson after the sale, leaving in October 2012 and then working on projects for the tech
transfer office at UM.
Gregorka said he was introduced to Baird through Chris
Rizik, CEO of Ann Arbor-based Renaissance Venture Capital Fund.
Gregorka and Baird formalized a
relationship in August.
Michael Liang, a partner at
Baird, said Gregorka — who has an
office in the downtown Ann Arbor
headquarters of another local VC
firm, EDF Ventures — has found a
handful of potential portfolio companies for the company to invest in.
“We brought David on board to
evaluate deals in our core areas of
interest, and Michigan is a major
focus for us because of the success
we’ve had there,” Liang said.
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The following businesses filed for
bankruptcy protection in U.S. Bankruptcy Court in Detroit Nov. 8-14. Under Chapter 11, a company files for reorganization. Chapter 7 involves total
liquidation.
Ankur Investments Inc., 17600 Dix
Road, Melvindale, voluntary Chapter
11. Assets and liabilities not available.
Damini Enterprises Inc., 2829 Oakwood
Blvd., Melvindale, voluntary Chapter
International Watch Group Inc., P.O.
Box 252527, West Bloomfield Township, voluntary Chapter 7. Assets:
$44,326.10; liabilities: $134,433.81.
NK Diamond Investment Inc., 25911
Michigan Ave., Inkster, voluntary
Chapter 11. Assets and liabilities not
available.
Rainbow Network Inc., 11097 E. Nine
Mile Road, Warren, voluntary Chapter 7. Assets: $35,000; liabilities:
$118,355.93.
Shree Harihar Corp., 1805 John A. Papalas Drive, Lincoln Park, voluntary
Chapter 11. Assets and liabilities not
available.
Sonda Enterprises Inc., 17355 Raupp
Road, Melvindale, voluntary Chapter
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20131118-NEWS--0021-NAT-CCI-CD_--
11/15/2013
12:04 PM
Page 1
November 18, 2013
Page 21
CRAIN'S LIST: LARGEST BUSINESS INSURANCE AGENCIES Ranked by 2012 revenue
Company
Address
Rank Phone; website
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
20.
22.
23.
24.
25.
Premium
volume
($000,000)
2012
Detroit-area
employees
2013
Total U.S.
employees
2013
Retail
Revenue source
Other
Commissions
Fees
Robert Cubbin
president and CEO
$147.0
$134.9
$1,500.0
286
1,044
37
0
61
2
23
77
Aon Corp.
Carol Williams, resident managing
director, CEO, Aon Risk Solutions
Paul Barbick, Michigan market
leader, Aon Hewitt
LeAnne McCorry, executive
chairman and managing principal,
Aon Risk Solutions
120.0
113.1
NA
171
34,000
85
0
15
0
40
60
Brown & Brown
David Lucas, president, Fenton
Angela Garner, president, Saginaw
Paul Glantz, president, Troy
Todd Piersol, president
70.0
70.0
NA
349
7,000
70
30
0
0
96
5
Marsh
Dan Deighton
managing director and Detroit office
head
48.0 B
NA
NA
135
9,013
NA
NA
NA
NA
NA
NA
Wells Fargo Insurance Services
Kevin Youngs
managing director, Southfield
24.5 B
24.9
NA
NA
NA
NA
NA
NA
NA
NA
NA
LSG Insurance Partners
Jay Schreibman
president and CEO
22.7
18.8
831.5
76
90
NA
NA
NA
NA
97
3
Valenti, Trobec, Chandler Inc.
Alan Chandler
president and CEO
21.8
20.1
NA
125
129
98
0
2
0
98
2
Hylant Group
Mark Miller
regional vice president, Michigan
20.6
15.9
250.7
119
617
99
0
0
1
86
14
Kapnick Insurance Group
Jim Kapnick
president
17.2
15.5
NA
55
130
100
0
0
0
90
10
McGraw Wentworth
Thomas McGraw
president
15.4
13.7
850.0
72
72
NA
NA
NA
NA
94
6
Michigan Financial Cos. Inc.
Nick Valenti
president and CEO
15.3
14.1
13.3
91
127
100
0
0
0
NA
NA
Schechter Wealth Strategies/Schechter Benefits
Services
Marc Schechter
senior managing director
8.8
8.4
NA
41
41
NA
NA
NA
NA
NA
NA
Laurie Sall & Associates LLC
Laurie Sall
president
8.5
6.3
8.5
3
3
0
0
0
0
100
0
Ralph C. Wilson Agency Inc.
Stefano Vannelli
president and CEO
7.0
6.5
NA
44
44
100
0
0
0
95
5
Daly Merritt Insurance
Martin Daly
president and CEO
6.8
6.2
78.6
40
40
98
0
0
2
99
1
Oswald Cos.
Donald Engle
senior vice president, branch
manager
5.7
4.4
NA
26
325
NA
NA
NA
NA
NA
NA
The Huttenlocher Group
David Huttenlocher
CEO
5.5
5.4
NA
43
43
100
NA
NA
NA
97
3
Korotkin Insurance Group
Kenneth Korotkin
president
5.2
4.8
NA
NA
46
NA
NA
NA
NA
NA
NA
J.S. Clark Agency Inc.
Joel Clark
president and CEO
3.7
3.4
NA
24
24
NA
NA
NA
NA
NA
NA
Allied Insurance Managers Inc.
Ron Kosmal
chairman and CEO
3.5
3.1
30.0
32
32
100
0
0
0
100
0
Great Lakes Employee Benefit Services Inc.
Joseph Coan and James Scoggin
principals/co-owners
3.5
3.0
106.1
13
13
100
0
0
0
100
0
Johnston Lewis Associates Inc.
Todd Lewis, president
Jay Sawmiller, executive vice
president
Mike Cardella, vice president
Dan Wilhelm, vice president
3.2
2.8
29.0
22
22
99
0
1
0
99
1
575 E. Maple Road, Troy 48083
(248) 528-2400; www.johnstonlewis.com
Midwest Underwriters Insurance Agency Inc.
Christopher Rodriguez
owner, CEO
3.1
2.9
NA
5
5
0
0
0
0
100
0
Capital Insurance Group
Robert Moglia Jr., president
Edmund George, vice president
Tom Moglia, vice president
Donn Johnson, vice president
3.0
3.0
27.6
22
22
NA
NA
NA
NA
NA
NA
Goodman Venegas
M. Paul Venegas
president
Regina Goodman
co-owner
2.9
2.8
NA
15
15
25
0
25
50
99
1
3000 Town Center, Suite 3000, Southfield 48075
(248) 936-5200; www.aon.com
35735 Mound Road, Sterling Heights 48310
(586) 977-6300; www.bbdetroit.com
600 Renaissance Center, Suite 2100, Detroit 48243
(313) 393-6800; www.marsh.com
4000 Town Center, Suite 800, Southfield 48075
(248) 353-5800; wfis.wellsfargo.com
2369 Franklin Road, Bloomfield Hills 48302
(248) 332-3100; www.lsgip.com
1175 W. Long Lake Road, Troy 48098
(248) 828-3377; www.vtcins.com
24 Frank Lloyd Wright Drive, Suite J4100, Ann Arbor 48105
(734) 741-0044; www.hylant.com
26100 American Drive, Suite 300, Southfield 48034
(248) 352-4455; www.kapnick.com
3331 W. Big Beaver Road, Suite 200, Troy 48084
(248) 822-8000; www.mcgrawwentworth.com
28411 Northwestern Highway, Suite 1300, Southfield 48034
(248) 663-4700; www.michiganfinancial.com
Wholesale Services
Compensation
Meadowbrook Inc.
26255 American Drive, Southfield 48034-6112
(248) 358-1100; www.meadowbrook.com
Top executive(s)
Revenue
Revenue
($000,000) ($000,000)
2012
2011
251 Pierce, Birmingham 48009
(248) 731-9500; www.schechterwealth.com
www.schechterbenefits.com
5435 Corporate Drive, Suite 205, Troy 48098-2624
(248) 641-2655; www.lauriesall.com
26026 Telegraph Road, Suite 100, Southfield 48086
(800) 638-1174; www.rcwa.net
100 Maple, Wyandotte 48192
(734) 283-1400; www.dalymerritt.com
39572 Woodward Ave., No. 201, Bloomfield Hills 48304
(248) 433-1466; oswaldcompanies.com
1007 W. Huron, Waterford Township 48328
(248) 681-2100; www.hgway.com
26877 Northwestern Highway, Suite 400, Southfield 48033
(248) 352-9124; www.korotkin.com
25900 W. 11 Mile Road, Suite 210, Southfield 48034
(248) 355-9600; www.jsclarkagency.com
1055 S. Blvd. E., Suite 110, Rochester Hills 48307
(248) 853-0930; www.alliedinsmgr.com
50 W. Big Beaver Road, Suite 460, Troy 48084
(248) 641-0000; www.glebs.com
19640 Harper Ave., Suite A, Grosse Pointe Woods 48236
(313) 884-8600; midwestunderwriters.com
1263 W. Square Lake Road, Bloomfield Hills 48302
(248) 333-2500; www.capitalinsuranceagent.com
2800 Livernois, Suite 170, Troy 48083
(248) 740-9090; www.goodmanvenegas.com
This list is an approximate compilation of the largest such agencies in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. It is not a complete listing but the most comprehensive available. Alliant Insurance Services, No. 12 on last year's list, which
Crain's believes would make the list, declined to provide figures, and a reliable estimate could not be made. Unless otherwise noted, information was provided by the companies. Companies with headquarters elsewhere are listed with the address and top executive
of their main Detroit-area office. Actual revenue figures may vary. NA = not available.
B Crain's estimate.
LIST RESEARCHED BY BRIANNA REILLY
20131118-NEWS--0022-NAT-CCI-CD_--
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November 18, 2013
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BUSINESS DIARY
CONTRACTS
MOVES
Wright & Filippis, Rochester Hills, an-
Dalton & Tomich PLC, a law firm, from
nounced new provider agreements
starting in 2014 with AAA Michigan,
Dearborn; CoventryCares of Michigan
Inc., Detroit; Managed Care Ancillary
Services, Quincy, Mass.; McLaren
Health Plan, Flint; Southeast Michigan Accountable Care Inc., Dearborn;
Total Health Care, Detroit; and Upper
41000 Woodward Ave., Suite 345,
Bloomfield Hills, to Chrysler House,
719 Griswold St., Suite 270, Detroit.
Telephone: (313) 859-6000. Website:
www.daltontomich.com.
Peninsula Home, Health, Hospice and
Private Duty, Marquette. The contracts include orthotics and prosthetics services. Wright & Filippis also
has renewed its long-standing contract with Northeast Michigan Community Services Agency Inc., Alpena.
Website: www.firsttoserve.com.
Vari-Form, Troy, is providing tubular
hydroform components for the 2014
Jeep Cherokee. Vari-Form manufactures upper cross members that are
integrated into a front-end module for
the Cherokee by Bayloff Stamped
Products,
Belleville.
Website:
www.vari-form.com.
Arotech Corp., Ann Arbor, a provider
of defense and security products for
the military, law enforcement and
homeland security markets, announced that its Training and Simulation Division has received $10.4 million in new contract awards and
modifications to previously awarded
contracts. The division consists of
FAAC Inc., Ann Arbor; IES Interactive
Training Inc., Ann Arbor; and Realtime Technologies Inc., Royal Oak.
Website: www.arotech.com.
EXPANSIONS
Buddy’s Pizza, Farmington, opened a
37643 six mile road - livonia - (734) 464-355
restaurant at 45841 Hayes Road, Shelby Township. Telephone: (586) 5661233. Website: www.buddyspizza.com.
Blue Cross Blue Shield of Michigan,
Detroit, and Blue Care Network,
Southfield, added Alcona, Antrim,
Arenac, Branch, Cheboygan, Hillsdale, Iosco, Lake, Manistee, Mason,
Montmorency, Ogemaw, Osceola, Oscoda, Otsego, Presque Isle and Wexford counties to its BCN Advantage
HMO-POS Michigan service area.
Also, Blue Care Network added My
Choice Wellness, an HMO plan with
St. Joseph Mercy Health System, Ann
Arbor, for Medicare-eligible residents
in Kent, Oceana and Muskegon counties. Website: www.bcbsm.com.
MERGERS
Waxenberg and Klein PLLC, Southfield, an accounting firm, merged with
Roth & Co. PC, Novi, to form Waxenberg, Wayntraub & Roth PLLC, Southfield. The new firm has moved from
25900 W. 11 Mile Road, Suite 240,to
26711 Northwestern Highway, Suite
200, Southfield. Telephone: (248) 3523630. Website: www.wwrcpa.com.
NEW PRODUCTS
TI Automotive Inc., Auburn Hills,
launched a brushless fuel delivery
module to improve efficiency and reliability with integrated electronics in
the flange. The module will be introduced on five new Peugeot and Citroen vehicles in Europe, with future
releases planned elsewhere. Website:
www.tiautomotive.com.
ForeSee Results Inc., Ann Arbor, a
data analytics firm, introduced its
ForeSee cx360 platform to help executives improve business results. Website: www.foreseeresults.com.
NEW SERVICES
Feinberg Consulting Inc., West Bloomfield Township, expanded its services
in case management to include
Bridgeway to Recovery, a drug and alcohol intervention program, and in
geriatric care management to include
Concierge Home Care. The new division, Bridgeway Home Care, combines
the medical knowledge and planning
of a geriatric care manager with the
services of a professional caregiver.
Websites: www.bridgewayhomecare.
com, www.bridgewaytorecovery.com,
www.feinbergconsulting.com.
STARTUPS
Wanderlust Boutique, featuring fashions, shoes and accessories, styling
consultations and home closet
makeovers, 404 S. Main St., Rochester.
www.facebook.com/wanderlustbouti
que1021.
Our Greentopia, a gift shop specializing in environmentally friendly products, 3165 W. 12 Mile Road, Berkley.
www.facebook.com/ourgreentopia.
DIARY GUIDELINES
Email news releases for Business
Diary to cdbdepartments@
crain.com or mail to Departments,
Crain’s Detroit Business, 1155
Gratiot Ave., Detroit, MI 482072997. Use any Business Diary item
as a model for your release, and
look for the appropriate category.
Without complete information, your
item will not run. Photos are
welcome, but we cannot guarantee
they will be used.
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20131118-NEWS--0023-NAT-CCI-CD_--
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11:17 AM
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November 18, 2013
Page 23
CALENDAR
TUESDAY
NOV. 19
SEO for CEOs: How to Use the Internet
to Grow Your Business. 9 a.m.-noon.
Advantage Oakland. For CEOs of
stage-two companies (more than two
employees, a website and more than
$100,000 in revenue) to learn to understand and apply marketing tactics
with focus on business-to-business
and business-to-consumer tactics and
strategies. Oakland County Business
Center, Waterford Township. Free.
Contact: Karen Lear, (248) 858-0783.
email: [email protected];
website:
www.advantageoakland
.com/startabusiness.
Good People Will Drive Detroit Forward. 11:30 a.m.-1:30 p.m. Detroit Economic Club. With Gary Burnison, CEO,
Korn/Ferry International, highlighting
traits and characteristics of great
leaders and how to keep employees engaged, motivated and relevant. Troy
Marriott, Troy. $45 DEC members, $55
guests of members, $75 nonmembers.
11:30 a.m.-noon speakers’ reception
open only to board, life and gold
members. Contact: (313) 963-8547;
email: [email protected]; website:
www.econclub.org.
HEALTH CARE REFORM
AND SMALL BUSINESS
Join Advantage Oakland at Oakland
County Business Center, Waterford
Township, 9 a.m.-noon Nov. 21 for
a discussion on health care reform
legislation and how it will affect
business owners.
Topics will include tax penalties,
small-business credits, smallbusiness wellness program grants
and full-time employee status
compliance.
Keynote speaker is David Drap,
insurance, wellness and health
care reform expert, and CEO of
HD4 Revenue Inc.
Attendance is free. For more
information, call Karen Lear at
(248) 858-0783, email her at
[email protected], or
visit www.advantageoakland.com/
startabusiness.
Livonia. Free. Contact: Doron
York, (248) 981-6688; email: dyork@
paarco.com; website: www.paarco.com.
Small Business: Unlocked — Meet the
Purchasers. 8 a.m.-noon. Detroit Re-
Hiring Trends & Real World ROI. 5:308:30 p.m. Detroit Chapter, Institute of
Management Accountants. With
Bradley Bilen, managing director,
Mergis Group, and Jeff Harrison,
director of lead generation and marketing, Logi-Serve LLC. Southfield
Marriott, Southfield. $30 members,
$35 nonmembers, $25 retirees, $15
students. Contact: Chuck Phillips,
(313)
262-2223;
email:
imade
[email protected];
website:
www.imadetroit.org.
gional Chamber, Talmer Bank and
Trust. Network with purchasers and
learn the basics of purchasing and
procurement protocol, and how to cut
through red tape and get your business on public sector RFP lists. Walsh
College, Troy. $30 Chamber members,
$70 nonmembers. Contact: Marianne
Alabastro, (313) 596-0479; email: mal
[email protected]; website:
www.detroitchamber.com.
Transforming Oakland County to a
Knowledge-Based Economy. 7-8 p.m.
The Community House. With L.
Brooks Patterson, Oakland County ex-
2-3 p.m. Wayne State University Department of Accounting. 2013-14
George R. Husband Distinguished
Lecture. With Michael Granof, Ernst &
Young Distinguished Centennial Professor in Accounting, McCombs
School of Business, University of Texas
at Austin; member of the Governmental Accounting Standards Board; Fed-
ecutive, on transforming Oakland
County to a knowledge-based economy that will create sustainable, highpaying jobs. The Community House,
Birmingham. Free; RSVP requested.
Contact: Terry Poduska, (248) 554-6596;
www.tchserves.org.
WEDNESDAY
Government Accounting: Back to Basics and Forward to the Future.
Renewing the Opportunity for Prosperity: Economic Freedom Zones. 11:30
a.m.-1:30 p.m. Dec. 6. Detroit Economic Club. With Sen. Rand Paul, R-Ky.,
who will unveil his legislative proposal to remove Detroit and other areas
from poverty and government oversight. MotorCity Casino Hotel, Detroit. $45 DEC members, $55 guests of
members, $75 nonmembers. 11:30 a.m.noon speakers’ reception open only
to board, life and gold members.
Contact:
(313)
963-8547;
email:
[email protected];
website:
www.econclub.org.
Better Business Bureau-Eastern
Michigan. With Steve Williams, president, EctoHR Inc., discussing the
biggest and most common HR mistakes small businesses make that can
impact long-term success. For business owners and managers. Better
Business Bureau, Southfield. Free.
Contact: Doris Hendricks, (248) 7990305; email: dhendricks@eastern
michiganbbb.org; website: www.east
ernmichigan.bbb.org.
Entrepreneur Boot Camp Celebration.
5:30-8 p.m. Ann Arbor Spark. Network
and celebrate the conclusion of the
Ann Arbor Spark Fall 2013 Entrepreneur Boot Camp. Spark Central, Ann
Arbor. Free. Contact: Alissa Carpenter, (734) 372-4071; email: alissa@an
narborusa.org; website: www.annar
borusa.org.
THURSDAY
NOV. 21
Leadership Is From Venus and Management Is From Mars. 8-10 a.m. Paar
& Co. LLC. Learn practices to ensure
the sustainability of your business
and how to avoid the most common
mistakes made by entrepreneurs and
business owners who expose their
business to unnecessary liabilities
and put them at high risk of losing
business. With Doron York, CEO, Paar
& Co. LLC. Davenport University,
ours are.
CALENDAR GUIDELINES
If you want to ensure listing online
and be considered for print
publication in Crain’s Detroit
Business, please use the online
calendar listings section of
www.crainsdetroit.com. Here’s
how to submit your events:
From the Crain’s home page, click
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there is to it.
More Calendar items can be found
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www.crainsdetroit.com.
Call for a free consultation.
Loan amounts: $1,000,000.00 and above.
s
s
s
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Owner Occupied Real Estate
Lines of Credit
Accounts Receivable
s
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Turnaround Consulting
Loan Modifications
Bank Workouts
800.509.3552
www.eclipsecapitalgroup.com
2207 Orchard Lake Road, Sylvan Lake, MI 48320
“Since 1997”
eral Accounting Standard Advisory
Board; and Educators Advisory Panel
of the U.S. Comptroller General. McGregor Memorial Conference Center,
Wayne State University. Free. Website: www.wayne.edu.
NOV. 20
The Seven Deadly Sins of HR. 8-10 a.m.
Your Bank’s
Not Lending?
in the global marketplace. Cobo Center, Detroit. $45 DEC members, $55
guests of members, $75 nonmembers.
11:30 a.m.-noon speakers’ reception
open only to board, life and gold
members. Contact: (313) 963-8547;
www.econclub.org.
Third Thursdays Networking. 4:30-6:30
p.m. Southfield Area Chamber of
Commerce. Tango’s at the Westin,
Southfield. Free. Contact: Tanya
Markos-Vanno,
(248)
557-6661;
email: [email protected];
www.southfieldchamber.com.
Construction Industry Night. 6-11 p.m.
National Association of Women In
Construction. Dinner, awards presentation. MGM Grand Detroit. $95. Contact: Davida Gerrity, (586) 264-2060;
email:
[email protected];
website: www.nawicdetroit.org.
UPCOMING EVENTS
Young Professionals Mixer. 5:30-7:30
p.m. Nov. 26. Auburn Hills Chamber
of Commerce. Rochester Mills Production Brewery, Auburn Hills. $10 members, $15 nonmembers. Contact:
Rachael Jay, (248) 853-7862; email:
[email protected]; website: www. auburnhillschamber.com.
Made in America: The Changing Face
of U.S. Manufacturing. 11:30 a.m.-1:30
p.m. Dec. 5. With Pete Selleck, chairman and president, Michelin North
America, on the changes U.S. manufacturing has undergone in the past 30
years and its resurgence as a key to the
country’s economic future. Selleck will
discuss how a renewed focus on modernizing technology, and educating a
workforce with the skills to support it,
have helped the U.S. regain its foothold
ENTER TO WIN A
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20131118-NEWS--0024-NAT-CCI-CD_--
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11:18 AM
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November 18, 2013
PEOPLE
FINANCE
Dagher
IN THE SPOTLIGHT
Wayntraub
Walid Dagher to partner, business tax
services practice, Deloitte Tax LLP,
Detroit, from senior manager.
Susan Wayntraub to partner, Waxenberg, Waynetraub & Roth PLLC, Southfield, from senior staff accountant.
Scott Babin to executive vice president of operations, Michigan Mutual
Inc., Port Huron, from chief marketing officer, E&A Credit Union, Port
Huron.
The Detroit Zoological Society,
Royal Oak, has named Jane
Alessandrini its
first chief
development
officer.
Alessandrini
had been
director of
major and
planned gifts at
St. Joseph
Mercy Health
System, Ann
Alessandrini
Arbor.
Alessandrini, 51, earned a
bachelor’s degree in familycommunity services from Michigan
State University.
NONPROFITS
Donna
Givens
Williams to president, Youth Development CommisDetroit,
sion,
LAW
Jamal Edwards to
partner, intellectual property litigation
practice
group, Honigman
from executive director,
Brightmoor Community
Center, Detroit.
Tonya Fleming to
program director,
Miller Schwartz
and Cohn LLP, Detroit, from manager and CEO, The
Ivey Group, Detroit.
Edwards
MARKETING
Andy Prakken to executive vice president, chief integration officer/business intelligence, Duffey Petrosky &
Co., Farmington Hills, from executive
vice president, chief media officer,
Team Detroit/WPP, Dearborn.
Williams
New Center Community Services,
Detroit, from director of operations,
The Children’s Center, Detroit.
SERVICES
John Law to vice president, enterprise
product strategy, ProQuest LLC, Ann
Arbor, from vice president, discovery
services, Serials Solutions at ProQuest.
Walters
Mukerjee
Cameron Walters to interactive marketing coordinator, Ziebart International Corp., Troy, from social media
marketing specialist, Hunch Free Inc.,
Mount Clemens.
Shakti Mukerjee to director of product
development, Resinate Materials
Group Inc., Plymouth, from senior research scientist, BYK Additives & Instruments (formerly Southern Clay
Products), Louisville, Ky.
Beth Hill to interim general counsel
and interim chief compliance officer,
FordDirect, Dearborn, from assistant
general counsel.
PEOPLE GUIDELINES
Announcements are limited to
management positions. Email them
to [email protected]
or mail notices to Departments,
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Gratiot Ave., Detroit, MI 482072997. Releases must contain the
person’s name, new title, company,
city in which the person will work,
former title, former company (if not
promoted from within) and former
city in which the person worked.
Photos are welcome, but we cannot
guarantee they will be used.
20131118-NEWS--0025-NAT-CCI-CD_--
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5:53 PM
Page 1
November 18, 2013
Page 25
Cancer: Resident’s plan fills gap in care
Sale: Towers
■ From Page 3
■ From Page 1
month fellowship at the 695-bed University of
Florida Health Jacksonville to learn cuttingedge microsurgery techniques. He finished
that program this year and returned to
Michigan.
On July 1, the Center for Head and Neck,
Maxillofacial and Reconstructive Surgery
program opened for business under
Ramirez’s direction. During the first four
months, 12 patients — ages 15 to 70 — have
undergone successful “free-flap” microsurgery.
“We saw a real need and gap in care for
head and neck cancer patients” at St. John
Macomb, said Ramirez, 35. “Nobody was
trained to do it here. We were losing lots of
patients and significant revenue to other
hospitals.”
Hamilton projects 56 surgeries during the
program’s first year, 70 the second year for
$1.5 million net revenue and 84 the third year
for $1.8 million net revenue. The hospital’s 10
operating rooms, which range from 450 to 600
square feet, have just enough capacity to accommodate the program, he said.
“He (Ramirez) has everything he needs for
the program except for a new (naso-pharyngo) scope (that the hospital purchased) to examine patients in his office,” Hamilton said.
“We also are adding an additional staff person to be dedicated” to the program.
Salama said the microsurgery program
has filled in a gap in services.
“We have a head and neck cancer program at the hospital, but we lagged in microvascular reconstruction,” Salama said.
“Now we have a microvascular person to do
these procedures. This completes that part
of the puzzle.”
Several other area hospitals perform
head and neck microsurgery. They include
the University of Michigan Hospital, Ann Arbor; Henry Ford Hospital, Detroit; Beaumont
Hospital, Royal Oak; Detroit Medical Center’s
Harper University Hospital; and Karmanos Cancer Institute, Detroit.
“I started this about six years ago, and
we have multiple surgeons involved,” said
Tamer Ghanem, M.D., director of Henry
Ford’s head and neck cancer and microvascular surgery program.
Ghanem said the program has grown from
about 35 cases per year to up to 80 this year.
“These procedures are typically the result of massive trauma to head and neck
from a car accident, assault or dog bite,”
Ghanem said. “More commonly now (it is
performed) after a big head and neck cancer
when a portion of the jaw or tongue needs to
be removed.”
Some 30 years ago, many head and neck
cancers were inoperable because there was
no technique to replace tumorous bone and
tissue. Radiation oncology treatment,
which is still used today in some cases, was
not always successful.
Recently, however, improvements in microsurgery have allowed surgeons to remove
diseased bone and tissue and replace them
with the patient’s own bone, tissue and skin.
“We take soft tissue (and sometimes
bone) from the back, arm, abdomen, leg,
and transfer to head and neck, or elsewhere
where needed,” said Ramirez, noting that
the procedure includes moving arteries and
veins that are sutured to seamlessly reconnect the “flap vessels” together.
Ramirez said the operations can take between four to 12 hours, depending on the
cancer. For example, a surgery in which a
tumor exists on the jawbone could take up
to 12 hours because bone from the leg, or
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fibula, needs to be removed and then reshaped into the jawbone.
After a seven- to 10-day hospital stay, some
patients are able to resume talking after
speech and language therapy, Ramirez said.
“Once patients make it to the seventh day
(without infection or tissue rejection), the
chance of losing the flap (living tissue)
drops to 1 percent,” said Ramirez, noting
that all free-flap surgeries have been successful and complication-free.
While oral cavity cancer cases have remained steady the past decade at about 22,000
per year, Ramirez said there has been an increase in younger patients affected by human
papillomavirus-associated head and neck
cancer. Major risk factors include smoking,
smokeless tobacco and alcohol use.
Only 5 percent of cancer cases are located
in the head and neck region, but 30 percent of
those are in the oral cavity, which includes
the bone, teeth, tongue, muscle, nerves and in
the areas of the mouth, according to the American Head and Neck Society.
St. John Macomb uses a multi-discipline
tumor board that reviews each oncology
case to decide on the best treatment, which
could include either surgery or radiation
treatment, Salama said. The board includes
head and neck surgeons, pathologists, radiologists, radiation oncologists and medical
oncologists, he said.
“There was a fear of the unknown in the
beginning” among some competing physicians when the microvascular surgery program was launched, Ramirez said. “We
have the full support (of all the specialties
now). They see this as something we are offering to patients.”
Jay
Greene:
(313)
446-0325,
[email protected]. Twitter: @jaybgreene
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cant, according to Bloomberg. The Southfield Class A office market had a 26 percent
vacancy rate during the third quarter, according to data provided by the Southfield
office of Newmark Grubb Knight Frank.
Matt Farrell, executive principal/partner
of Bingham Farms-based Core Partners Associates LLC, said the Southfield Town Center
offers good amenities such as the Westin Hotel — which would not be included — and
restaurants on site. It also has a campus-like
setting.
“Those are all big, big pluses,” Farrell
said.
But there are some drawbacks.
“The downside, potentially, is that the
newer culture, the younger technologybased firms are looking for that warehouse/potentially downtown-like setting
that gives them walkability,” Farrell said.
According to CoStar, the largest tenants
are GlobalHue Inc., with 109,000 square feet;
Fifth Third Bank, 106,000 square feet; and AlixPartners LLP, 63,000 square feet.
Denver-based HFF Inc. is marketing the
complex and has hired Southfield-based NAI
Farbman to represent Blackstone locally in
the sale. The Southfield office of CBRE Inc. is
responsible for leasing the property.
Kristen Murphy, associate director of marketing for HFF, would only confirm that the
complex is for sale.
NAI Farbman, through a spokeswoman,
declined comment.
Among large office complexes in metro
Detroit, the Southfield Town Center, built in
1975, is second in square footage only to the
5.5 million-square-foot Renaissance Center in
total size.
Kirk
Pinho:
(313)
446-0412,
[email protected]. Twitter: @kirkpinhoCDB
313.446.6068 • FAX: 313.446. 034 7
E-Mail: cdbclassif [email protected]
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20131118-NEWS--0026,0027-NAT-CCI-CD_--
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Page 26
November 18, 2013
As Detroit spends millions on consulting firms to turn a
some officials have a déjà vu moment and
Is Orr driving new road wit
lighted a road map to what it was
going to take to turn around government, and that included a lot of
If Judge Steven Rhodes ap- things that are going to be impleproves the city of Detroit’s entry mented now,” said Chris Brown,
into bankruptcy proceedings in who helped develop the plan durfederal court, a reorganization ing his time as COO from 2009-12.
plan is due to him early next year.
In an email to Crain’s, Orr’s
But elements of that plan may spokesman, Bill Nowling, said city
ultimately ring familiar to many; consultants did not use the 2011
some of the major ideas are the plan as a template for the credisame sort of things addressed in tors’ proposal, which was released
outgoing Detroit Mayor Dave in June. He also said many of the
Bing’s deficit elimination plan ideas in it have been around for
first submitted to the Michigan De- years — but the city never had a
partment of Treasury in 2011. That plan to execute them.
includes measures like outsourcOrr, on the other hand, comes to
ing and restructuring city retire- Detroit from Cleveland-based law
ment and benefits plans.
firm Jones Day armed with broad
Ask Emergency Manager Kevyn powers to renegotiate union conOrr’s office what the differences tracts and institute reforms under
are and the answer can be summed Public Act 436 of 2012, the state’s
up as “the devil is in the details.” emergency manager law.
In other words, exeAs Orr atcuting a turnaround
tempts to reneplan, and all the degotiate
contailed work that comes
tracts
and
with it, is a whole lot
works with a ledifferent
gion of consulthan
tants to work on
having
outsourcing
the big
and
reform
ideas.
plans, many of
In
the specific acfact, the
tion steps and
state’s
the daunting fiFinannancials
are
cial Reideas long faview
miliar to conTeam deemed Bing’s
stituents and
2011 report as inadeobservers.
quate to address the
Nowling
city’s enormous budget
said that
problems and said its
while the
revenue assumptions
2011 plan may
Chris
Brown,
were considered queshave called for
former Detroit COO
tionable.
slashing specifYet Orr’s initial Proic budgets, the
posal to Creditors returned to city’s restructuring consultants
some of the same areas of focus for have been working to implement
the city to cut costs and right its fi- the restructuring proposals rather
nancial ship.
than just proposing them.
A decision from Rhodes is ex“The idea is the easy part. Impected any day on the city’s eligi- plementing them is hell,” said
bility to proceed in its Chapter 9 Erik Gordon, a professor from
bankruptcy case after he heard practice in the University of Michicourt testimony and reviewed le- gan School of Law and a clinical asgal briefs.The $18 billion bank- sistant professor in UM’s Ross
ruptcy is the biggest filed by a U.S. School of Business. “I have the
municipality, and the court case idea to go to the moon. OK, good
has already featured unprecedent- idea. The implementation is the
ed testimony from Orr, Bing, Gov. hard stuff.”
Rick Snyder and many others.
Still, the groundwork for reform
had already been laid in past reports, Bing and Brown said.
BY KIRK PINHO
“
We highlighted
a road map to what
it was going to
take to turn
around
government, and
that included a lot
of things that are
going to be
implemented now.
”
The groundwork
The similarities between Bing’s
2001 turnaround plan and the elements Orr included in his Proposal to Creditors, and is expected to
highlight in a restructuring plan,
are causing some former city officials to criticize what they consider duplicative work. They say
much of the money spent on Orr’s
plan, and with more than a dozen
consulting firms, was a waste.
“If you take a look at the 2011
deficit elimination plan, we high-
Cost-cutting
“The day of reckoning is at our
doorstep.”
That’s from the third page of the
deficit elimination plan, which
Bing presented to the Detroit City
Council and sent to the Treasury
Department two years before Orr
took the city into Chapter 9 municipal bankruptcy court in July.
“When we think about the unfunded pension liabilities, way
back in 2011 we recognized that
was a major issue,” Bing said in an
interview with Crain’s. Orr’s
proposal projects the city’s unfunded pension and other postemployment benefit liabilities at
$9.2 billion, which is about half of
the city’s estimated $18 billionplus in debt and other liabilities.
Deficit elimination plans are required by state law whenever a local government fund ends a fiscal
year with a deficit.
Bing’s plan called for increases
to employees’ retirement age, resulting in $84 million to $460 million in savings. In addition, it
called for eliminating compounded cost-of-living increases, saving
the city up to $1.4 billion, and removing all grant-funded and noncore employees from the pension
system, yielding $140 million in
savings. The plan called for increasing the vesting period from
eight years to an unspecified
length of employment, resulting in
up to $211 million in savings.
The plan, which also called for
increased health care contributions from union members, from
10 percent to 20 percent, was presented before the enactment of
Public Act 152 of 2011, which requires public employees to contribute 20 percent to their health
care costs.
“These were tough decisions to
make and people didn’t want to
make them,” Brown said.
The Proposal for Creditors says
“significant cuts” in pensions and
health care benefits
for current city employees and retirees
will be needed.
Since the proposal’s release,
Orr has announced a plan
for increased deductibles for city
employees and a
reduction in the
number
of
health
care
plans available from 20
to one. It would save $12
million annually.
“
$60 MILLION IN CONTRACTS FOR TURNAROUND
The city of Detroit has contracted with more than a dozen consulting firms
to turn around its finances and government. The contracts are valued at
more than $60.6 million and the city has spent about $19.1 million of that
as of Sept. 30.
The contracts are with:
Conway MacKenzie Inc., turnaround firm, Birmingham, $19.3 million.
Jones Day, law firm, Washington, D.C., $18 million.
Ernst & Young LLP, accounting firm, Detroit, $8 million.
Miller Buckfire & Co. LLC, turnaround firm, New York, $8 million.
Plante Moran PLLC, accounting firm, Southfield, $3.97 million.
Pepper Hamilton LLP, law firm, Southfield, $850,000.
Miller, Canfield, Paddock and Stone PLC, law firm, Detroit, $750,000.
Manhattan Institute for Policy Research, think tank, New York; and
Bratton Group LLC, public safety consulting firm, New York, $621,000
combined.
Milliman Inc., actuary and consulting, Seattle, $332,000.
Christie’s Appraisals Inc., auction house, New York, $250,000.
Duffey Petrosky and Co., marketing, Farmington Hills, $186,000.
Abernathy MacGregor Group, public relations, New York, $120,000.
Stevenson Keppelman Associates, law firm, Ann Arbor, $100,000.
RR Donnelley, integrated communications technology, Detroit, $90,000.
Kurtzman Carson Consultants LLC, turnaround firm, Los Angeles, no
contract amount stated.
Source: Bill Nowling, spokesman for Emergency Manager Kevyn Orr
Authority, created by a state law after the Bing report was released.
The authority is tasked with making about $160 million in improvements to the city’s failing streetlight system, in which an
estimated half of its 88,000 streetlights are not working.
“The lighting issue, we dealt
with that before (Orr) got here,”
Bing said.
In addition, Bing’s plan called
for outsourcing
solid waste collection
services, saving
the city $14 million per year.
In July, Orr
released
a request
for
proErik Gordon,
posals for resiUM professor
dential
solid
waste and recycling pickup.
Last week, the
city announced Sterling Heightsbased Rizzo Environmental Services
Inc. and Ponte Vedra, Fla.-based
Advanced Disposal Inc. will take
over solid waste hauling from the
Department of Public Works in
March under a five-year deal to be
finalized in 30 days.
Both reports also say Detroit Police
Department operations need improvement, particularly on efficiency and response times. Current response times are often 58 minutes or
more; Orr’s proposal to creditors
calls for reducing DPD response
times to the national average of 11
minutes. The Bing and Orr plans
also call for more officers patrolling
the streets rather than in administrative duties and the evaluation or
consolidation of some specialized
department units.
The idea is the
easy part.
Implementing
them is hell.
Outsourcing
It wasn’t only through proposed
large-scale — and politically unpopular — pension and health care
reforms where the plans presented
similar ideas. Both lay out paths
for things like outsourcing public
lighting, which was proposed in a
2011 McKinsey & Co. report that was
folded into Bing’s plan.
McKinsey said that without
more than $200 million in cash or
private-sector management, the
Detroit Public Lighting Department
would continue to deteriorate.
Orr’s plan says the city will outsource its lighting operations and
maintenance to the Public Lighting
”
The reports also say shared services agreements should be explored.
The 2011 plan also called for the
city to explore joint operations
with Wayne County for the Department of Public Works, the Buildings,
Safety Engineering & Environmental
Department and the Department of
Transportation.
Orr’s proposal says consultants
are evaluating DDOT for a possible merger with the Suburban Mobility Authority for Regional Transportation, which is also an option laid
out in the 2011 plan.
Orr’s proposal is not specific
about which other city departments
could be merged, but says “consolidation and elimination of redundant functions will be implanted
where service improvements or cost
savings can be achieved.”
The 2011 plan says the city
would research joint programs for
information technology services
with Wayne County and recreation centers with Detroit Public
Schools.
The sales block?
The 2011 plan proposed no asset
sales or leases other than of public
parking infrastructure, such as
meters and garages, and the
Detroit-Windsor Tunnel rights. Similar proposals are being evaluated
by Orr’s office.
Orr’s proposal includes possible
sales and leases of other assets,
and the emergency manager has
said in past interviews with
Crain’s that those are under consideration.
Belle Isle is among those, as are,
potentially, the Detroit Institute of
Arts collection and the Detroit Water
and Sewerage Department.
20131118-NEWS--0026,0027-NAT-CCI-CD_--
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Page 2
November 18, 2013
Duggan priorities:
Transition, talent
rn around the city’s finances,
and wonder …
with old map?
Crain’s reporter Kirk Pinho
talked last week with Mike Duggan, Detroit mayor-elect, about
his first priorities and how he’ll
be spending the balance of the
year before he takes office Jan. 1.
The city and state signed a 30- dress its financial problems, offi- CFO from 2008 to 2009 and Benton
year lease agreement in October cials “changed the goalposts on us.” Harbor’s former emergency manfor the Department of Natural
“Any time we proposed some- ager — reviewed the 2011 plan. He
Resources to manage and maintain thing that would improve efficien- said he thinks the city had a sound
Belle Isle, a move expected to save cy or reduce costs, we never got proposal in place, regardless of
the city $4 million in operating the kind of support we needed state officials’ criticisms.
“I haven’t seen anything new” in
costs. The city would still be from Lansing to move our proposresponsible for providing about al forward,” he said. “We needed Orr’s proposal that hadn’t been proposed before, he said. “If the consul$2 million worth of water and sew- people and we needed money.”
er service to the 985-acre island.
Money is something Orr can tants are using that (plan) at all,
The DIA is attempting to stave bring, however, as he tries to re- then why is the cost so high? Are
off the possible sale of parts of its structure the city’s debts inside they reinventing the wheel? It doescollection to appease city credi- and outside of bankruptcy court. n’t make a lot of sense to me for
tors. It has asked
One result of re- those types of costs to be incurred.”
the state to considstructuring those
er giving money to
debts — and one imDetroit
portant difference
Documents Nowling provided to
— perbetween the two
haps
plans, according to Crain’s show that as of Sept. 30, the
$20 milBuss — is Orr’s procity has spent $19.1 million on conlion to
posal to spend $1.25 tracts with companies restructur$25 milbillion over 10 years ing Detroit’s debt and government,
lion
on improving pub- and representing it in Rhodes’
over 20
lic safety services, bankruptcy court. The total value
years
reducing blight and of the contracts is $60.6 million,
—
in
improving
the but it’s not known how much it
excity’s antiquated cost to compile the Proposal to
change for the DIA
information tech- Creditors.
“It was part of the ongoing reproviding expandnology structure.
Patrick O’Keefe,
ed services across
The 2011 plan was structuring work up to that point,”
Michigan.
filed with the state Nowling said, adding that the 2011
O’Keefe LLC
Orr has proposed
in midyear. The plan was not a template for Orr’s
a new regional authority, the Met- March 2012 Financial Review proposal.
Solutions that can feasibly be
ropolitan Area Water and Sewer Au- Team report, which found that the
thority, to operate the DWSD city was in “severe financial implemented cost money, O’Keefe
through a concession agreement stress,” concluded that some of the said. He conceded, however, that
or via a lease of water department plan’s proposals were question- there is a “learning curve” for
assets. Discussions between city able. Yet Orr, who was appointed “people who have not been up to
consultants and officials from by the state in March, is taking speed” on the city’s budget woes.
But for Bing and Brown, the
Oakland, Wayne and Macomb steps similar to what Bing procity’s former COO, that doesn’t
counties continue.
posed.
dampen
the
Asset sales and leases such as
For example, in
frustration.
those, however, are politically dif- August,
Orr
an“For the Pubficult for elected officials.
nounced that a valuing
lic Lighting De“The stuff like the DIA and the of
the
partment, a lot
art collection, and even the region- city’s Deof that diagnosalization of the water and sewer, troit-Windtic work had
politically those are grave things sor Tunnel
been done. For
to be talking about,” said Patrick rights was
DDOT, if you’re
O’Keefe, CEO of Bloomfield Hills- being congoing to outbased turnaround consulting firm ducted,
source it, it
O’Keefe LLC, which does not have a along with
doesn’t take milcontract with the city during its a valuing
lions of dollars
restructuring.
of
other
(to research
“Kevyn Orr is not a politician; city assets.
it);
that work
he’s putting everything on the table The Financial Review
has
already
and that’s what you should do.”
Joe Harris,
Team report doubted
been
done.
But are the sales or leases worth that the city could get
former city auditor general Same for municit?
$10 million for the sale
ipal
parking.
Bettie Buss, a recently retired of those rights.
For DPW, we
senior research associate for CitiOrr’s report says the city doesn’t had started on that path but hadn’t
zens Research Council of Michigan, collect between $30 million and $45 gotten very far,” Brown said.
said it’s a judgment call.
million each year in income taxes
Bing, who chose not to run for a
She also questions whether the from residents who work outside second full term, said he has “maDWSD’s regionalization — intend- the city and improved tax collec- jor frustration” that restructuring
ed in part to save money through tion is needed. Yet the Financial proposals he and other city offilower bond interest rates on Review Team questioned whether cials developed prior to the state’s
$1.2 billion in needed capital im- the improved income tax collec- appointment of an emergency manprovements because “Detroit” tion discussed in Bing’s report ager are not recognized as being
wouldn’t be in the name of the new could bring in the $50 million that similar to ones Orr is working on.
authority — would achieve the in- city officials estimated.
“No doubt in my mind about it,”
The Financial Review Team re- he said. “I had all of my internal
tended financial rewards.
“Do you think investors are that port also doubts the city could leadership committed to the
achieve significant expenditure changes. We were making
stupid?” Buss asked.
reductions through union conces- progress, but nobody was satisfied
sions, which the report says “had with the rate of progress.”
not historically materialized.”
Kirk Pinho: (313) 446-0412, kpinBing said that whenever the city
Still, Joe Harris — the city’s au- [email protected]. Twitter: @kirkpinwent to the state with a plan to ad- ditor general from 1995 to 2005, its hoCDB
“
Kevyn Orr is not
a politician; he’s
putting
everything on the
table, and that’s
what you should
do.
Consultants weigh in
”
“
If the consultants
are using that
(plan) at all, then
why is the cost
so high? Are they
reinventing the
wheel?
”
Mixed messages?
Page 27
What are your first few key orders
of business after you take the oath
of office?
Right now, we are totally consumed with trying to work out an
agreement with the governor
(Rick Snyder) and (Emergency
Manager) Kevyn Orr. So the first
thing we’ve got to establish is
whether I have any authority,
and if so, what it is. That’s really
where we are spending our time.
What is the time frame for that?
Hopefully within the next few
weeks. It’ll have to be some time
before Jan. 1.
What can we expect during the
transition regarding business community outreach and support?
We’re working on that right
now. We’ve got a number of very
talented people, and I’m proud of
the people who volunteered, and
we will put them together in a
group and try to develop a (city
reorganizational) plan.
Do you have a short list for any
Cabinet member positions?
At the moment, I don’t have
any authority to hire a Cabinet,
so no. This is a two-step process.
Without authority from the
emergency manager (to hire a
Cabinet), there is no point in me
talking to people about jobs.
(Named last week to Duggan’s
transition team were Ike McKinnon, former city police chief; Lisa
Howze, former state representative; and Bryan Barnhill, campaign manager, who will work as
talent intake director to help
Duggan
recruit.
Campaign
spokesman John Roach is communications director.)
You’ve met with Orr, Snyder and
outgoing mayor Dave Bing. What
were some of your key takeaways
from those meetings?
We’re just trying to solve
things constructively. We are
talking and trying to find a solution.
Do you think the city will be declared eligible for Chapter 9 bank-
ruptcy?
The judge is going to do (what
he wants). I expect we’ll get a decision by Thanksgiving.
What other key leaders in the
community do you expect to meet
with in the next couple of weeks?
I met with a large number of
the legislators. I had lunch with
five of the nine City Council
members, and I’ll get through all
nine in the next week. Then basically, it’s just all day long, sitting
down with community and business people.
What will you look for in other
members to round out your transition team?
We’re going to have 12 different
committees. You’re going to see a
good mix of business and community people. You’re going to see experienced
individuals
and
younger, rising stars. I think you’ll
see a good mix of the community,
just like my campaign was.
What’s your impression of the new
City Council members so far?
We’ve had great conversations. I think there is a sense that
the fighting between the mayor
and the council in the past certainly contributed to the situation we are in, and I think there
is a shared feeling that we are going to work together to make
sure that never happens again.
What are your thoughts on the Detroit Future City plan? Are there any
specific aspects that you disagree
with?
I like it. It’s a big book, but I
like the plan and I like the direction. I like the idea of the neighborhoods participating in writing their own visions for the
future and having it fit into an
overall plan for the city. I think
it’s great, and a great approach.
Do you envision implementing any
of the reform proposals talked about
before Kevyn Orr arrived?
I’m going to make a judgment
based on where we are. The city’s
financial position is likely to be
dramatically different when
bankruptcy ends, and I’ll manage
it appropriately based on the situation at the time.
Kirk Pinho: (313) 446-0412, [email protected].
Twitter:
@kirkpinhoCDB
KENNY CORBIN
Mayor-elect Mike Duggan announced the co-chairs of his transition team on
Wednesday: retired Detroit police chief Ike McKinnon and Lisa Howze, a CPA
and a former state representative.
20131118-NEWS--0028-NAT-CCI-CD_--
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2013
UPCOMING
PARTNER EVENTS
Crain’s partners with a variety of
organizations on events by providing
special subscription offers for their members.
Visit their websites for more details.
Michigan Hispanic
Chamber of Commerce
November 18, 2013
The Michigan Hispanic Chamber of Commerce
(MHCC) 24th Annual Fiesta Hispana Gala
This black-tie, A-list event celebrates the success
of the Hispanic business community and draws
Michigan’s most prominent business, civic and
community leaders for an extraordinary evening.
Corporate sponsorship packages and individual
tickets are still available. The evening starts with
a VIP cocktail reception, followed by dinner and
an awards ceremony. The evening concludes with
the high-energy, rhythmic sounds of Dal Bouey
and her band.
Dec. 6 • 6 p.m. – midnight
MGM Grand Detroit, 1777 3rd St., Detroit
Members/Non-members: $200
Registration: mhcc.org or Barbara Lange
at 248-792-2763
Marketing & Sales Executives of Detroit
(MSED) Holiday Networking
Join MSED members and friends for an evening
of professional networking. Bring your colleagues
and make new connections with some of the top
marketing and sales executives in Michigan. The
evening includes appetizers, one drink ticket and
a prize drawing.
Dec. 17 • 5 – 7 p.m.
BlackFinn American Saloon,
530 South Main Street, Royal Oak
Members: $20 • Non-members: $20
Registration: msedetroit.org or Meeting
Coordinators at 248-643-6590
Troy Chamber’s Holiday Luncheon and
Best of Troy Presentation
Start with a networking reception with the area’s
business decision makers from 10:30-11:30 a.m.
Then enjoy a keynote address by Local 4 Sports’
Bernie Smilovitz, lunch and lots of holiday cheer.
Everyone leaves with a Holiday Biz Bag. This is
typically the Troy Chamber’s most popular event
of the year.
Dec. 18 • 10:30 a.m. – 1:30 p.m.
Detroit Marriott Troy,
200 W. Big Beaver Road, Troy
(Additional $5 for day of registration,
space-permitting)
Registration: troychamber.com/cal,
248-641-8151 or [email protected]
Macomb County Chamber Alliance 2014
Economic Forecast
Discover what’s ahead for the Macomb
community as James Jacobs, Ph.D., president of
Macomb Community College, presents his annual
economic forecast. Lunch is included.
Jan. 15 • 11:30 a.m. – 1:30 p.m.
Zuccaro Banquets & Catering,
46601 Gratiot Ave., Chesterfield Twp.
Registration: macombcountychamber.com
Karmanos: Pact restricts name usage
■ From Page 1
and Lapeer.
The branding restrictions prevent McLaren from advertising
and marketing Karmanos at one of
its two Southeast Michigan hospitals — McLaren Oakland in Pontiac
— and nearby outpatient centers
in Clarkston, Bloomfield Hills and
Pontiac.
The DMC-Karmanos agreement,
Lane said, allows for exceptions at
McLaren Macomb and an outpatient
center, both in Mt. Clemens.
McLaren’s website now includes
a map of McLaren’s cancer centers
that include Karmanos Cancer Institute in Detroit and Karmanos’
outpatient centers in Farmington
Hills and Monroe.
“Those are Karmanos’ existing
properties. We are not changing
those,” Lane said, adding that
McLaren does not consider listing
Karmanos on its website as marketing in the three-county area.
Over time, Tompkins said, signs
for the McLaren Cancer Institute,
which is McLaren’s existing oncology service line, will be replaced
with Karmanos Cancer Institute
signs at its hospitals and medical
centers, and in advertising campaigns.
“We believe Karmanos is a very
strong and trusted brand. We plan
on extending it into our network
in the communities we are in,”
Tompkins said.
In a previous interview, DMC
CEO Joe Mullany said DMC opposed the McLaren acquisition
and made an offer to Karmanos,
but didn’t receive an answer.
DMC was acquired by Dallasbased for-profit Tenet Healthcare
Corp. in June after
Vanguard
Health Systems, a
Nashville,
Tenn.-based forprofit
chain,
took over DMC
on Jan. 1, 2012.
Mullany said
DMC will watch
closely
how
Mullany
McLaren brands
the Karmanos name in Macomb,
Oakland and Wayne counties.
“Karmanos has been frustrated
that it cannot expand their brand
because of the agreement,” Mullany said.
McLaren also is prohibited by
the agreement from moving the
Karmanos operation outside of the
DMC campus, Mullany said. DMC
filed a successful 2007 lawsuit that
prevented Karmanos from moving
to shuttered St. John Riverview
Hospital in Detroit.
Lane restated McLaren’s intention not to move Karmanos’ inpatient operations outside of the
DMC campus.
In a statement last week, Mullany said the DMC has not been
provided any details on the acquisition.
“We don’t know if Karmanos
has taken steps within that agreement to ensure their ongoing compliance with and commitment to
the terms and conditions of the
contractual arrangements between Karmanos and DMC,” said
Mullany, who was out of town last
week.
Over the past few years, sources
have told Crain’s that several hospital systems were interested in
MCLAREN OUTPATIENT CENTERS
䡲 McLaren Health Care hospitals:
Bay City (2), Flint, Lansing (2),
Lapeer, Mt. Clemens, Mt.
Pleasant, Petoskey, Pontiac
䡲 McLaren outpatient centers
(general and cancer): Bay City,
Bloomfield Hills, Charlevoix,
Cheboygan, Clarkston, Detroit,
Farmington Hills, Flint (2), Gaylord,
Lansing (2), Lapeer, Monroe, Mt.
Clemens, Mt. Pleasant, Owosso,
Petoskey, Pontiac, West Branch
Source: McLaren Health Care
forming closer affiliations with
Karmanos, but the DMC agreement prevented those arrangements. The systems include Henry
Ford Health System and Beaumont
Health System.
Gerold Bepler, M.D., Karmanos’
CEO, told Crain’s that Karmanos
discussed acquisition and other
arrangements with other health
systems in Michigan. He declined
to name the systems.
Brian Connolly, CEO of Oakwood
Healthcare, a four-hospital system
in Dearborn, said Oakwood was
prevented by DMC from co-branding services with Karmanos.
“I understand DMC is interested
in having tertiary cancer business
draw (to) downtown,” Connolly
said. “I don’t think necessarily by
having that brand (with other systems outside of Detroit) wouldn’t
result in tertiary care services still
going downtown.”
But Mullany said the McLarenKarmanos combination will likely
force DMC to look for other partners to further develop its oncology services.
Sources told Crain’s that
McLaren has pledged to spend
$80 million over four years to upgrade Karmanos’ downtown hospital and expand its two outpatient
centers at the Weisberg Cancer Center in Farmington Hills and the
Monroe Cancer Center, a joint venture with Mercy Memorial Hospital
System and Toledo-based Promedica.
According to the asset purchase
and lease agreement, which was
referenced in DMC’s May 4, 2007,
complaint against Karmanos, Karmanos is required to operate the
hospital under the name Karmanos Cancer Institute at the Detroit Medical Center. Other provisions include:
䡲 Requiring Karmanos and the
DMC to jointly market their services at the DMC main campus.
䡲 Requiring the DMC to stop
providing inpatient and outpatient
cancer hospital services on the
DMC main campus.
䡲 Providing that “any breach by
Karmanos of any provisions would
cause irreparable harm to DMC
(and allow for) injunctive relief.”
Ann Hollenbeck, Karmanos attorney with Honigman Miller Schwartz
and Cohn in Detroit, said Karmanos is working
through
procedural issues with the
DMC contracts.
“We are being
very careful and
respectful” of all
the parties, said
Hollenbeck
Hollenbeck, who
declined to answer a series of questions about the contract limitations.
Patricia Ellis, Karmanos media
relations manager, said Karmanos
is aware of the branding restrictions placed on it by the DMC cancer business acquisition.
“The DMC required that if Karmanos were to clinically affiliate
with any hospital or health system
based in the tri-county area that
DMC would have the right to grant
permission in advance (which
must not be unreasonably denied),” said Ellis in a statement to
Crain’s.
Ellis added that the restriction
does not apply to Karmanos’ educational or research programs.
Lane said McLaren has not
asked DMC for co-branding permission in the three-county area,
but “we believe the DMC has the
right to grant additional exceptions,” he said.
Jay Greene: (313) 446-0325,
[email protected]. Twitter: @jaybgreene
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20131118-NEWS--0029-NAT-CCI-CD_--
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4:45 PM
Page 1
November 18, 2013
Page 29
New shuttle services to offer airport transportation alternatives
BY BRIDGET VIS
Metro Detroit travelers will
soon have two new options for getting to and from Detroit Metropolitan Airport.
Shuttle Co. of America, a Henderson, Nev.-based airport shuttle and
transportation company, is awaiting a license approval from the
Michigan Department of Transportation to begin offering daily transportation from downtown Detroit
to the airport.
And The Detroit Bus Co. will test
a potential airport transport service over Thanksgiving weekend.
Detroit would be the second
market for Shuttle Co. of America,
which operates regionally in Las
Vegas. The company said its downtown-to-airport service will be $43
round trip.
Transportation will be provided
in Ford Transit Connect vans and
Mercedes-Benz passenger vans.
The Detroit Bus Co. transport
service will run two routes, from
Royal Oak and downtown Detroit,
on Nov. 27 and Dec. 1. A one-way
fare will cost $12; a round trip is
$22.
Detroit Bus Co. is working with
the Detroit Department of Transportation to create the route and
schedule and said it already has
300 people signed up as potential
customers through its website,
thedetroitbus.com.
Detroit Bus Co. and Shuttle Co.
of America would be less expensive than transportation options
currently available.
A taxi fare from Metro Airport
Taxi is $43 one way from downtown and $55 from Royal Oak, and
a Metro Cars fare is $56 one way
from downtown and $77 from Royal Oak, according to the companies’ websites.
A general taxi fare to Metro Airport from downtown Detroit would
cost about $42 each way; from
Royal Oak, the one-way cost
would be $51, according to
Taxifarefinder.com.
Metro Airport travelers who drive their own cars face on-site parking fees between $8 and $20 a day
or off-site parking fees between $6
and $20 a day, depending on the
lot.
Comerica: Park among venues redoing surfaces
■ From Page 3
Ice time
New grass
Construction of the temporary
ice rink at Comerica Park will begin the day after Thanksgiving,
and such a project costs between
$800,000 and $1 million, said Benn
Breton, president and co-owner of
Rink Specialists.
The firm, in business since 2006,
constructs 20 outdoor temporary
rinks a year, including two for the
NHL, he said. In 2013, it is doing
three NHL rinks, in Detroit, at
Boston’s Fenway Park and at minor-league baseball’s Frontier
Field in Rochester, N.Y., for the
Buffalo Sabres.
Rink Specialists will install the
custom temporary rink and provide all of the staff, operations
and maintenance during the
events, Breton said.
Everything used for the rink is
shipped from the company’s
Maine facility, he said.
“We build all this equipment or
we have it built,” Breton said.
The temporary Comerica rink
will stretch roughly between first
and third base, just beyond the
pitcher’s mound, said Tim Padgett,
Red Wings vice president of venue
operations and general manager of
Joe Louis Arena.
A hard surface will be placed
around the rink for spectators and
snow-removal vehicles and other
machinery to use, he said.
The Hockeytown Winter Festival is a series of college and minorleague hockey games, and two
NHL alumni games, that will accompany the NHL’s open-air Winter Classic between the Red Wings
and Toronto Maple Leafs at Michigan Stadium in Ann Arbor on Jan.
1.
The NHL owns its own rink it installs for the Winter Classic, which
is televised nationally on NBC. The
league is renting the football stadium for a month at a cost of nearly
$3 million.
Red Wings owner Mike Ilitch
sought the Winter Classic for
42,000-seat Comerica Park, home
to the Ilitch-owned Tigers, but the
NHL preferred the 109,901-seat UM
football stadium because it said it
wants a larger crowd capacity.
As a compromise — Ilitch, after
all, since 1982 has owned one of the
NHL’s Original Six franchises —
the NHL agreed to foot the bill for
hockey events at Comerica.
The ice rink at Comerica will be
removed in January, and once the
weather cooperates, replacement
grass will be installed.
Depending on the thickness of
the custom turf, how much is needed and how quickly it’s needed to
use, the cost of a baseball field
ranges from $100,000 to more than
$250,000, said James Graff, co-owner and president of Fort Morgan,
Colo.-based Graff’s Turf Farm.
Graff’s is bidding on the Comerica Park job. It installed new natural grass at MSU’s Spartan Stadium for $253,000 following a U2
concert on the football field in
June 2011. The Irish rock band’s
contract to play at the stadium included it picking up the cost of the
new turf.
Graff’s has provided the grass
for Wrigley Field in Chicago, the
University of Notre Dame’s football
stadium, Busch Stadium in St.
Louis and several other major college and pro facilities.
The Colorado-grown sod would
be shipped to Michigan in refrigerated trucks, and installed over several days.
Stadiums hosting concerts or
sports other than what’s normally
played there — football inside
baseball stadiums — has picked up
as a trend and necessitated more
field replacements, Graff said.
“That’s really become a big part
of sports venues in the last six or
seven years,” he said. “Most times,
a field gets replaced because of a
nonsports activity. They’re revenue-generating opportunities for
sports teams.”
In addition to normal game
wear, the Tigers have replaced or
repaired sections of turf after concerts by Kid Rock, Paul McCartney
and Jimmy Buffett in recent years.
After a Rolling Stones concert in
September 2005, Tigers head
groundskeeper Heather Nabozny
and her crew had to immediately
replace 22,500 square feet of outfield grass.
In cold-weather states, the specialized turf often comes from elsewhere.
“Most athletic fields, especially
in Michigan, are a Kentucky bluegrass blend, and 90 percent of the
sod grown in Michigan is also a
Kentucky bluegrass blend,” said
Diane Mischel, whose family owns
SURFACE BEAUTY
Here’s a look at the recently
installed playing surfaces for the
area’s major sports teams:
䡲 Comerica Park
Team: Detroit Tigers
Surface: Kentucky bluegrass
Manufacturer: N/A
Cost: $100,000-$250,000
Installed: 2007
䡲 Ford Field
Team: Detroit
Lions
Surface:
Field Turf
Classic HD
(artificial
grass)
Manufacturer: Montreal-based
FieldTurf Inc.
Cost: $600,000-$1 million
Installed: 2013
䡲 Joe Louis Arena
Team: Detroit Red Wings
Surface: Ice
Manufacturer: In-house ice-making
equipment
Cost: N/A
Installed: 1.5
inches of ice,
made from
15,300 gallons
of water mixed
with white paint, are put down in
numerous fine layers before each
season.
䡲 Palace of Auburn Hills
Team: Detroit Pistons
Surface: Pro King Portable Floor
(maple wood)
Manufacturer:
Dollar Bay-based
Horner Flooring
Co. Inc.
Cost: $100,000
Installed: 2011
䡲 Michigan Stadium
Team: University of Michigan
football
Surface: Field Turf Duraspine Pro
Manufacturer: Montreal-based
FieldTurf Inc.
Cost: $412,000
Installed: 2010
䡲 Spartan Stadium
Team: Michigan State University
football
Surface: Kentucky bluegrass
Manufacturer: Fort Morgan, Colo.based Graff’s Turf Farm
Cost: $253,000
Installed: 2011
Source: Crain’s research, teams
DeBuck Sod Farm Inc. in Davison.
“For a high-end field such as
Comerica Park, they are also looking at the soil profile the sod is
grown in; usually they want a sandbased soil which aids in drainage.
This would be harder to find native
to the farms in Michigan.”
Teams are fiercely protective of
their turf: The Tigers fired several
employees in early 2000 for walking on the first turf planted at the
ballpark, which opened that year,
according to Detroit Free Press reports at the time.
Other surfaces
The Detroit Lions in January began replacing the original artificial turf at Ford Field, which
opened in 2002.
The team installed FieldTurf
Classic HD, manufactured by Montreal-based synthetic grass giant
FieldTurf Inc. Replacement turf,
which can include a variety of options but doesn’t require as much
infrastructure work as the initial
installation, can range in price
from about $600,000 to $1 million.
The price for Ford Field wasn’t
disclosed.
The artificial grass uses an infill
mix of silica sand and rubber and
is intended to have cheaper maintenance costs than natural grass.
FieldTurf also provided the past
two artificial turf fields at Michigan Stadium, the last installation coming in 2010 at a cost of
$412,000, the university said.
The Detroit Pistons in 2011
spent $100,000 on a new hardwood court, one that can be installed or removed in two
hours with six people, from Dollar
Bay-based Horner Flooring Co. Inc.
The Upper Peninsula company
has provided courts for the NBA’s
All-Star games since 1983, and the
home courts for dozens of pro, college and high school basketball
teams.
Coincidentally, another maker
of basketball courts, Salt Lake
City-based Connor Sport Court International, has its manufacturing
plant in Hematite Township in the
same region of the UP.
Bill Shea: (313) 446-1626,
[email protected].
Twitter:
@bill_shea19
www.crainsdetroit.com
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20131118-NEWS--0030-NAT-CCI-CD_--
11/15/2013
5:51 PM
Page 1
Page 30
November 18, 2013
RUMBLINGS
High-profile
folks to share
tales of failure
veryone has a failure story.
Grand Rapidsbased Failure Lab is bringing
to the Motor City six of
these tale tellers: Charlie
Wollborg,
founder of
Curve Detroit
and force
behind
TEDxDetroit;
Diana Sieger,
president of
the Grand
Rapids ComWollborg
munity Foundation; Jimmy King, member
of the University of Michigan
Fab Five and vice president
of business development for
Schechter Wealth Strategies;
Marsha Music, 2012 Kresge
Literary Arts Fellow;
Andwele Gardner (better
known by his stage name,
Dwele), a singer-songwriter
and record producer from
Detroit; and Jessica Care
Moore, five-time Showtime
at the Apollo winner.
So how do you convince
six high-profile people to
tell their darkest secrets?
You ask them.
“You certainly have some
awkward coffees,” said
Jonathan Williams, cofounder of Failure Lab.
“But it is the most interesting conversation. You sit a
stranger down and you say,
‘What was your biggest
struggle to overcome?’ It’s
the fastest way to make actual deep friendships. It’s
been the best side effect of
starting this whole thing.”
Failure Lab debuted in
Grand Rapids in May after
two years incubating the
E
idea. It will travel to Mexico
City and New Orleans next
year.
But first the storytellers
will come to the Detroit
Opera House at 7 p.m.
Nov. 21. Tickets are $20 and
can be purchased at
failure-lab.com or the door.
New veterans shelter gets
help from Tigers alums
How does a new nonprofit
attract Detroit Tigers alumni
from the 1968 and 1984
World Series teams to one
of its first fundraisers?
Roseville shelter Vets Returning Home just opened its
doors in October. Its “Showdown in Motown” on Dec. 4
is a debate about which
World Series team was better, and benefits the shelter
and two other veterans
charities: Operation Injured
Soldiers in South Lyon and
Tennessee-based U.S. Military All-Stars.
Sandy Bower, owner of EC
Metro LLC, a merchant services and credit card processing company in Clinton
Township, bought an 11,000square-foot building on 11
Mile Road in Roseville to
open the shelter for veterans
and provide job services.
She’s recruited only three
people for her board of directors so far, but one of
them, Paul Dehem, a real estate broker with X-Pressrealty.com LLC in Shelby Township, was able to recruit the
players.
His brother Mark is the
player liaison for the Tigers
and vice president of the De-
WEEK ON THE WEB
FROM WWW.CRAINSDETROIT.COM, WEEK OF NOV. 9-15
troit Tigers Alumni
Association. He’s also Willie
Horton’s agent.
Appearing from the 1968
team will be Horton, Al
Kaline, Denny McLain, John
Hiller, Tommy Matchick and
John Warden. From the 1984
team will be Lance Parrish,
Darrell Evans, Dave Rozema
and Dan Petry.
The event is scheduled
for 6 p.m. at MGM Grand Detroit. Tickets are $150. Call
(810) 588-9106 for details.
Safety group sets honors
Dan Loepp, president and
CEO of Blue Cross Blue Shield
of Michigan, and Saul Green,
senior counsel at Miller Canfield PLC, will be honored
Dec. 3 in the first Detroit
Public Safety Foundation gala
to honor business leaders
and first responders.
Loepp will receive a
“change makers” award,
and Green will get an award
for ethics. Medal of Honor
and Purple Heart awards
will go to various Detroit Police Department officers and
members of the Detroit Fire
Department.
The foundation was created in 2011 and has secured
more than $30 million in
grants to support Detroit
police and fire departments.
The event will take place
at Cobo Center’s Grand
Riverview Ballroom. Tickets are $150 to $500 and
sponsorships are up to
$5,000. More details are at
detroitpublicsafetyfoundation.
org.
BITS & PIECES
The University of Michigan
Depression Center recently
gave its Mike Wallace
Award to Waltraud “Wally”
Prechter for her establishment of the Heinz C. Prechter
Bipolar Research Fund at the
university. The award recognizes an individual for
commitment to conquering
depression, bipolar disorder and related illnesses.
BEST FROM THE BLOGS
READ THESE POSTS AND MORE AT WWW.CRAINSDETROIT.COM/BLOGS
Some answers on Belle Isle lease Suppliers ask: What drives you?
“
Don’t worry,
Detroiters: We won’t be
turned away from Belle
Isle even if we don’t yet
have a Department of
Natural Resources
recreation
passport.
”
Amy Haimerl’s blog on small business can be found at
www.crainsdetroit.com/section/blogAmyHaimerl
“
What’s your
passion? … The answer
is rarely the automotive
industry. And it’s no
surprise the automotive
industry fell out of
fashion.
”
Dustin Walsh’s “Shifting Gears” blog can be found at
www.crainsdetroit.com/walsh
Sebelius in
Detroit: Health
site will improve
uring a visit to Detroit on Friday,
Health and Human
Services Secretary Kathleen Sebelius sought to reassure the public that the
troubled federal insurance
website that launched Oct.
1 will be much improved
by the end of this month.
Sebelius toured the Community Health and Social Services Center, where she observed as counselors
helped guide uninsured
residents through their options under the new health
care law, the AP reported.
D
ON THE MOVE
䡲 DeWayne Wells, president of Detroit-based Gleaners Community Food Bank of
Southeastern Michigan,
stepped down to take a new
role with the agency as its
national policy and advocacy officer. Gleaners Board
Chairman Walt Young will
be interim president while
the board searches for
Wells’ successor.
䡲 Maria Leonhauser will
retire at year’s end as president of Detroit-based Franco Public Relations Group.
Tina Kozak, executive vice
president and COO, will
succeed Leonhauser, who
will become a consultant
with the agency.
䡲 Saad Chehab, head of
the Chrysler and Lancia
brands, will give up those
positions to become chief
marketing officer of Fiat
S.p.A.’s Maserati luxury
brand. Al Gardner, head of
Chrysler Group LLC’s southeast business center in
Florida, will head the
Chrysler brand, Automotive News reported.
䡲 After 19 years as executive director of the St.
Frances Cabrini Clinic in Detroit, Sister Mary Ellen
Howard announced she will
retire next summer. The
clinic has begun a search
for a replacement.
䡲 Waterford’s Pat LaFontaine took over as president of hockey operations
in a management shakeup
by the Buffalo Sabres. The
former National Hockey
League player is related to
the family that owns Dearborn-based LaFontaine Automotive Group.
COMPANY NEWS
䡲 The Detroit Tigers took
two of Major League
Baseball’s top postseason
honors, with third baseman Miguel Cabrera winning his second consecu-
tive American League Most
Valuable Player award and
pitcher Max Scherzer claiming the AL Cy Young
Award.
䡲 Denver-based Triton
Properties Inc. purchased
four apartment buildings
totaling 143 units near and
along the east Detroit riverfront for an undisclosed
amount from Detroit-based
Cynex Enterprises.
䡲 Detroit-based law firm
Dickinson Wright PLLC announced a cooperation
agreement with Velchev &
Co., a law firm based in
Sofia, Bulgaria, that extends Dickinson Wright’s
gaming practice into Europe for its global clients.
䡲 The Detroit Red Wings
launched a digital 40-page
retail catalog, but fans can’t
order online. National Hockey League rules say revenue
from retail sales on the site
should be split equally
among the league’s 30
teams. But revenue from
in-person and faxed sales
go straight to the Red
Wings.
䡲 Detroit-based DTE Energy Co. halted power production and construction at
Echo Wind Park in Michigan’s thumb area while it
investigated why a blade
broke on one turbine.
OTHER NEWS
䡲 A three-member state
panel unanimously approved a 30-year state lease
of Belle Isle, as the Local
Emergency Financial Assistance Loan Board rejected
Detroit City Council’s counterproposal for a 10-year
lease.
䡲 The American Federation of State, County and Municipal Employees asked
U.S. Bankruptcy Judge
Steven Rhodes to send any
ruling he makes on Detroit’s eligibility for bankruptcy court protection to
the U.S. Court of Appeals for
the 6th Circuit for automatic review because it will
hinge on whether the city
bargained in good faith before filing its bankruptcy
in July.
䡲 The city of Detroit secured a five-year agreement with its EMTs and
paramedics union — the
first successful bargaining
agreement since the city
filed for bankruptcy.
䡲 Federal prosecutors
want former Detroit Mayor Kwame Kilpatrick to pay
about $4.5 million for widespread corruption under
his watch, the AP reported.
䡲 Michigan’s public
universities will provide
in-state tuition for all veterans, regardless of state of
residency or active duty
status, the Presidents Council, State Universities of
Michigan announced.
䡲 The University of Michi-
gan was one of four U.S.
public universities honored by the Washington,
D.C.-based Association for
Public and Land-Grant Universities for work in entrepreneurship, technology transfer and business
development.
䡲 Detroit Central City
Community Mental Health
Inc. received $793,000 in
federal funding to create
Southeast Michigan’s sixth
federally qualified health
center.
䡲 Home sale prices last
month in Wayne and Macomb counties increased
by 43.6 percent and 46.2
percent, respectively, over
October 2012, according to
Farmington Hills-based Realcomp II Ltd.
䡲 Singer Sheryl Crow is
slated to perform at the
Jan. 17 North American International Auto Show charity preview in the new Cobo
Atrium at Cobo Center.
䡲 “Infant St. John the
Baptist in the Wilderness,”
a 17th century painting by
Spanish artist Bartolome
Esteban Murillo that was
hanging at Meadow Brook
Hall, will go on display at
the Detroit Institute of Arts
early next year after it was
spotted by DIA curator Salvador Salort-Pons.
䡲 The Detroit Symphony
Orchestra plans to tour
Florida in February and
March with support from a
$400,000 grant from the
General Motors Foundation.
䡲 Nurse practitioners
and other nurses with advanced training could practice without oversight by
physicians and prescribe
drugs under legislation
that passed 20-18 in the
Michigan Senate. Also, the
Senate voted 22-16 to allow
pharmacies to sell marijuana for medical purposes.
䡲 This year’s Michigan
apple crop is expected to be
10 times as plentiful as last
year’s, due to two techniques — one that temporarily stops apples’ ability to respond to their own
cues for ripening, the other a play on refrigeration
— that keep apples fresh
longer, the AP reported.
OBITUARIES
䡲 Paul Buscemi, founder
of the Roseville-based Original Buscemi’s Inc. party
store pizza franchise business, died Nov. 7. He was
89.
䡲 Barbara Morley Erb, who
with her husband, the late
Fred Erb of Erb Lumber Co.,
established the Birmingham-based Fred A. and Barbara M. Erb Family Foundation, died Nov. 8. She was
89.
䡲 Former Detroit Renaissance Inc. President Robert
E. McCabe, 89, died Nov. 10.
He was 89.
DBpageAD_DBpageAD.qxd 10/3/2013 4:09 PM Page 1
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DBpageAD_DBpageAD.qxd 11/7/2013 4:25 PM Page 1

Pages 1-32 - Crain`s Detroit Business

Transcription

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