Crain's Detroit Business, June 10, 2024

Experts say scandal shows need for controls

By Sherri Welch

Big or small, nonpro ts are at risk for embezzlement.

ere are internal controls all nonpro ts can and should put in place, experts say. But they’ll only work if they are enforced in a timely manner and organizational leaders don’t get lax on controls as familiarity and trust set in.

e issue of internal controls is front and center amid allegations that the Detroit Riverfront Conservancy’s former CFO William Smith created fake bank statements for board, leadership and accountant review, hiding his alleged embezzlement of about $40 million from the organization for roughly a dozen years.

See SCANDAL on Page 18

“From the smallest to the largest organization, segregation of duties is a key control, no matter what.”

John Bebes, Plante Moran

Lawmakers prep for impact of possible minimum wage ruling

LANSING — Gov. Gretchen Whitmer and lawmakers are preparing for a politically thorny proposition should the Michigan Supreme Court invalidate the state's minimum wage law and reinstate one that mandates higher pay for workers and no longer counts tips toward the minimum.

ey could simply keep intact the changes, which were pro-

posed under a 2018 ballot initiative that Republican legislators adopted and later watered down to be more business-friendly. Or they could make revisions — something that worker advocates and employers are lobbying for ahead of the high court's decision, which is due by the end of July. e fate of Michigan's paid sick leave law also is stake.

"It could have sweeping impact," Whitmer said of the pending decision during a Crain's in-

terview at the Mackinac Policy Conference.

If the court, where Democrats have a 4-3 majority, strikes down the unprecedented "adopt-andamend" tactic, the $10.33 hourly minimum wage could rise to more than $13. e $3.93 tipped wage, which lets businesses pay 38% of the regular wage if employees' tips make up the di erence, may be eliminated.

See WAGE on Page 16

GM pitched Wayne Co. on RenCen move

Representatives from General Motors Co. and Detroit development players have pitched Wayne County on moving its ofces to the Renaissance Center from the Guardian Building in downtown Detroit.

Within the last several months, the idea was posited to Wayne County as part of a multi-party series of discussions about the future of the state’s most prominent and polarizing o ce complex. e fate of the RenCen is in limbo as GM — which owns the majority of it — plans to vacate and move its global headquarters to Dan Gilbert’s Hudson’s Detroit project next year.

A source familiar with the matter, speaking on the condition of anonymity, said Wayne County has received proposals from GM representatives and others about a move. Pitches have been made about a relocation to the main GM-owned complex, which consists of four 39-story o ce towers anking a 73-story hotel skyscraper, as

well as the second phase of the development, the two shorter 21-story o ce towers that opened in the 1980s that GM does not own.

e location and layout of the RenCen complex on the Detroit Riverfront may pose challenges to county government operations serving the public.

“Identifying suitable usage for the Renaissance Center, once General Motors relocates, is a critical issue for our region and Wayne County is at the table looking at all viable options,” Wayne County said in a statement May 31.

“As we explore possibilities, one of our top concerns is ensuring our government o ces are readily available and accessible to the public. We are doing our due diligence and will decide based on what’s in the best interest of our constituents.”

e source said Wayne County o cials are skeptical such a move would happen.

“It

New Birmingham Shopping District leader on her downtown vision.

worries me on the side of the servers but as well on the side of the companies,” said Ash eld Donnan, a server and bartender at Seabiscuit Cafe on Mackinac Island who has worked on the island for eight seasons since 2012, to highlight the potential impact of a state Supreme Court ruling on a controversial law regarding minimum wages for tipped workers.

David Eggert

Kirk Pinho

See RENCEN on Page 17

The nancial scandal at the Detroit Riverfront Conservancy should be a cautionary tale to other nonpro ts and businesses, experts say. DETROIT RIVERFRONT CONSERVANCY VIA FACEBOOK

Pistons interested in bringing WNBA team to Detroit

By Jay Davis

Professional women’s basketball is growing in popularity and franchises, and Detroit is on the outside looking in.

Detroit isn’t on the WNBA’s list for potential expansion, but Detroit Pistons o cials want to stay in the game.

e NBA team has had conversations with the WNBA to gather information and learn more regarding its expansion plans, Pistons Chief Communications Ocer Kevin Grigg told Crain’s in an email.

Local basketball fans have shown they would support the product in the past. e WNBA’s Detroit Shock had more than 160,000 fans at their 17 home games in 2004 — the season following the team’s rst championship. e Shock still hold the single-game attendance record, set on Sept. 16, 2003, in Game 3 of the WNBA Finals with 22,076 fans in attendance for a Shock win.

By comparison, the 2023 WNBA Champion Las Vegas Aces last season averaged 9,551 fans at each home game during a 40-game season.

e Detroit Shock, which debuted in 1998, was one of the league’s rst expansion franchises and won championships in 2003, 2006 and 2008. Despite its success, it was losing money and in October 2009 it was announced that the Shock would move to Tulsa, Okla. Longtime Pistons owner Bill Davidson also owned the Shock

and sold the team.

“ e Detroit Shock enjoyed success and won championships during their run in the 2000s and we celebrated the anniversary of their 2003 championship at a Pistons game last year,” Grigg told Crain’s. “While nothing is imminent, the prospects of bringing a WNBA team back to Detroit is intriguing and we have interest should they open another round

of expansion. We will continue to engage in conversation with the WNBA going forward.”

e now 28-year-old WNBA will grow from 12 to 14 teams with the addition of squads in San Francisco and Toronto. League Commissioner Cathy Engelbert in April laid out a list of other potential landing spots that includes Philadelphia, Denver, Nashville, South Florida and Portland, Ore. Engel-

bert wants the league to be at 16 teams by 2028.

Following the 2024 WNBA Draft in April, which drew a record 2.45 million viewers to see college stars including Caitlin Clark and Angel Reese selected, WNBA o cials told Front O ce Sports that the league continues to engage in productive talks with interested ownership groups in a variety of markets and the granting of any

expansion team requires the vote of the WNBA and NBA Board of Governors.

Interest in the women’s league is growing because of players like Las Vegas Aces two-time MVP A’ja Wilson and 2023 MVP Breanna Stewart of the New York Liberty. Wilson’s rst signature shoe drops next year. Stewart’s third shoe was released earlier this spring. Stewart’s teammate Sabrina Ionescu has one of the more popular shoes in basketball, with several NBA players even playing in the Sabrina 1. A new crop of players including Iowa’s phenom Clark — the No. 1 pick this year — LA Sparks rookie and Detroit native Rickea Jackson, fellow rookie and teammate Cameron Brink, and Reese are also bringing more eyes to the game. After adding Clark, ticket sales skyrocketed for Fever games — home and away.

e WNBA is even taking additional steps to give women players the same treatment their male counterparts receive. e league last month announced it would institute a full charter ight program for the entire league in a partnership with Delta Air Lines. Not only is the women’s league gaining in popularity, the money is starting to roll in, too.

e WNBA in February 2022 announced it had raised $75 million in capital. e league has been using the funds in strategic areas such as marketing, digital transformation, globalization and fan engagement. e WNBA is now valued at around $475 million.

Demolition slated for Ilitch-owned building on Cass

By Kirk Pinho

Less than a year after outcry over the demolition of a Cass Avenue building owned by the Ilitches in Detroit’s former Chinatown area, their development company has put another building in the path of a wrecking ball.

A demolition permit was issued May 16 for the former Charlotte Lounge building at 3107 Cass Ave. at Charlotte Street, according to city records. State environmental records list the demolition contractor as Detroit-based Farrow Group Inc.

A spokesperson for the Ilitch family’s Olympia Development of Michigan real estate company said May 23 it purchased the building in December 2020 and it was “not in good condition” at the time. A recent analysis by a state structural engineer concluded it was not safe, Olympia said, prompting its decision to seek permission to raze it.

“We are excited at the progress already underway in the surrounding blocks of Cass and Peterboro and look forward to the results of the Lower Cass Corridor Planning Study to help us further our development e orts in e District Detroit,” an Olympia statement reads.

An Ilitch family entity called

Cass Revival LLC paid what Crain’s estimates is $244,000 for the building to Landy Cass Avenue Development Corp., connected to the late Detroit developer Joel Landy, according to land records.

An email was also sent to a spokesperson for the city’s Buildings, Safety Engineering and Environmental Department.

In 2021, a Chicago artist painted a mural of rapper Eminem on the building and the art was soon defaced, the Detroit News reported at the time.

e Charlotte Lounge demolition would mean that the majority

of the remaining structures on Cass Avenue’s west side between Charlotte to the south and Peterboro to the north — all Ilitch owned — will have come down in the last ve or so years, following a 2019 re and subsequent demolition of the former Gold Dollar bar at 3127-3129 Cass Ave. in 2019.

In July, the Ilitches tore down the neighbor to the Charlotte Lounge, a two-story brick building at 3143 Cass Ave. e building had been declared dangerous. After the demolition plans became public for that property, the Detroit City Council passed a resolution seek-

ing a temporary halt to demolition and interim historic designation, although the Duggan administration later said the council’s request “has no legal force or e ect and does not take precedent over the interests of public safety.”

“It has been the position of our inspectors for some time that this building is a public safety hazard that needs to be addressed,” Dave Bell, BSEED director, said in a statement in July 2023 about the property.

Demolition then began, and concerns continued over the fate of the enclave, which became known as Chinatown after the area that previously held that designation west of downtown was razed as part of “urban renewal” in the 1950s, according the Detroit Historical Society.

Gabriela Santiago-Romero, the Detroit City Council member who represents the area, said at the time that the 3143 Cass demolition represented a loss of a building with signi cance to Detroit’s Chinese and Chinese American community. A voicemail was left at Santiago-Romero’s o ce on May 23 seeking comment.

In May 2023, Harper Woodsbased American Community Developers purchased the former Chung’s restaurant at the southwest corner of Cass and Peterboro and has been working on renovat-

ing it. If the Charlotte Lounge is razed, it would be the last building standing along that stretch.  e Ilitches have faced criticism for the handling of their vast real estate portfolio, ranging from lack of progress in e District Detroit area after a July 2014 announcement of the plans to anchor several new mixed-use neighborhoods with what became Little Caesars Arena to the demolition of buildings — some historic — they long owned but never xed up.

Among those that have been torn down, to name a few: e old Madison-Lenox Hotel downtown across from the Detroit Athletic Club; the Adams eatre/Fine Arts Building on Grand Circus Park; the Chin Tiki restaurant in the Cass Corridor; and the historic Louis Kamper-designed Park Avenue Hotel.

Olympia and New York Citybased Related Cos., run by mega-developer and Detroit native Stephen Ross, have pitched some $1.53 billion in new construction and renovated historic buildings in a revamped development e ort anchored by the University of Michigan Center for Innovation, now under construction. Hundreds of millions in tax incentives have been awarded on the projects, although they are not awarded if construction doesn’t happen.

Members of the Detroit Shock’s 2003 WNBA championship-winning team celebrate during a Pistons game in 2023. | DETROIT PISTONS

The former Charlotte Lounge at Cass Avenue and Charlotte Street in Detroit is expected to be demolished. | KIRK PINHO

A microbrewery with a side of cheese opens

By Jay Davis

A Troy native has returned home to open a business the Oakland County city is lacking.

Eli Green opened Stumblebum Beer Co. June 1 at 1965 W. Maple Road in Troy. e microbrewery is just the second in Troy. e rst, Loaded Dice Brewery, is planning a move to Clawson.

“Coming back, I had my eyes set on a few di erent spots,” Green told Crain’s. “ ere are so many breweries in so many areas around here — Birmingham, Clawson, Rochester. It’s something I think has a chance to do very well in Troy because there isn’t really anything like it.”

Green, now a resident of Ferndale, is using an interesting hook with his rst venture. e former homebrewer is pairing beer with cheeses and meats. Charcuterie will be a big part of Stumblebum. e pairing isn’t as odd as it may sound, Green said.

“I’ve talked with sommeliers who absolutely believe cheese is better paired with beer,” Green said. “ ere are so many types of beer, so many types of cheese. It’s a natural pairing.”

e cheeses are paired with 26 beers brewed onsite in brew kettles in full view through a large bay window at the rear of the brewery. Red and white wine are also available.

e food menu also includes panini sandwiches and french fry ights. e fries pair seasonings such as parmesan garlic and swiss onion with dips like malt vinegar mayo and a tru e aioli.

“ e menu isn’t going to be too extensive, but we’ve got some things people will be interested in,” Green said.

Stumblebum is being run out of a 5,546-square-foot space that previously housed Bailey’s Sports Grille. e craft brewery has seating for around 100 and a sta of about 10, Green said.

e interior, done by Birmingham-based DesignTeam Plus, features wood high- and low-top tables. e bar at the north of the brewery has a face similar to a train car and is made from wood from Bailey’s. DesignTeam Plus has also done work on Draught Horse Brewery in Lyon Township and Stiggs Brewery & Kitchen in Boyne City.

DesignTeam Plus owner Shari Stein said Green came in with a vision that DesignTeam Plus brought to life.

After a soft opening, a grand opening was slated for June 15. Hours are not set in stone, but Stumblebum will be open Tuesday-Saturday. Green said his brewery won’t stay open late into the night.

“As big as Troy is and as much as it has going on, it’s not really walkable,” Green said. “You won’t see a lot of people parking and walking to bars and restaurants. at could change, though. If we’re getting busier later in the day, sure, we could switch things up.”

Green did not disclose the investment into the business, saying only that Stumblebum is privately funded. He also did not share rev-

enue projections.

Green did share the inspiration behind the name of the brewery.

Stumblebum is a nickname given to Green while he was a student at Rollins College in Florida. e business’ logo features a hop cone at the end of a stick, similar to wanderer or hobo.

“ e de nition for Stumblebum is ‘a clumsy or inept person.’ It didn’t stick very long after college and I had almost forgotten it all together until I needed to come up with a unique name for my business,” Green said. “Now it’s more of a mascot who represents an easygoing wanderlust and curiosity.”

Green’s road home comes after an attempt at a theater career in New York where he worked as a voice actor and freelance video editor. Green says he became obsessed with food pairings following a lecture on beer and cheese. He later met Brooklyn Brewery brewmaster Garret Oliver who schooled Green on beer and cheese pairings, and explained to the aspiring brewer why that pairing works better than wine and cheese.

“ e hops and protein content go together well,” Green said. “I think we’re going to show a lot of people something they might not have ever thought about.”

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Troy native Eli Green opened Stumblebum Brewing Co. in his hometown.

| JAY DAVIS

AC Hotel on Woodward adds rooftop bar to project

One of the hotels on Detroit’s docket to open has o cially topped out — with a bit of a twist. An orange twist, that is.

e AC Hotel on Woodward Avenue just south of Mack Avenue straddling the Brush Park and Midtown neighborhoods reached its peak height of 129 feet recently and is on track to open in the fourth quarter of this year, said David Di Rita, principal of Detroit-based e Roxbury Group, which is developing the $49 million, 10-story building.

at’s good news for the city and its tourism and real estate industries as they attempt to bolster Detroit’s supply of hotel rooms to help land more conventions and other large events (see: the NFL Draft).

ere’s also some good news for those of you who enjoy some booze with some views: ere will be a rooftop bar, which is an addition to the plan that was nalized after construction o cially started about a year ago.

AC Hotels are a Marriott International brand that feature curated art, robust libraries, DIY lavender turndown service, tness centers, day-to-night AC Lounge

and AC Kitchen.

Di Rita said there will be views looking west and south, giving a pretty solid look at the (evolving) downtown skyline, uninterrupted.

“You do not get just an unbroken southern view of the Detroit skyline very often because too often you’re in that skyline,” Di Rita said.

If the rooftop bar doesn’t open

when the hotel does, it will open by the spring, Di Rita said.

e as-of-yet named bar would grow the list of rooftop venues in the city and suburbs, and add another to the Roxbury Group’s portfolio. e rooftop Monarch Club is at the Roxbury-owned e Element hotel on John R downtown.

It’s going to be managed by San Diego-based Azul Hospitality Group, which also manages Roxbury’s hotels and owned food and beverage options including e Hammer & Nail in e Plaza on Woodward north of Mack; the Buhl Bar on Griswold Street downtown; and the Lone Goat at the Element, located in the former Metropolitan Building.

the Bonstelle eatre immediately to the south.

to the National Register of Historic Places in 1982.

Charles

Detroit-based Sachse Construction is the general contractor on the AC Hotel while Edmonton-based Stantec, which has a Berkley o ce, is designing the project and interior design is by Patrick ompson Design, based in Detroit.

Although they are separate projects, the AC Hotel is being developed in conjunction with a $7 million to $10 million renovation of

e Bonstelle, which dates back to 1903 when it was designed by Albert Kahn as Temple Beth El, became a C. Howard Crane-designed theater in 1925 after the synagogue moved north. It was then renamed the Bonstelle Playhouse. Following the Great Depression, it became a movie house and in 1951 was purchased by Wayne State University, which restored it and returned it to its use as a theater. It was added

It was decommissioned after Wayne State built the $65 million Hilberry Performing Arts Complex on Cass Avenue, which opened last year.

When the Bonstelle restoration is nished it will be used for things like live performances, plus civic, corporate and other private events. It is going to be connected to the hotel with a glass-enclosed conservatory, which is also going to have a bar and private event space.

Bills focus on charter school transparency

By David Eggert

LANSING — e Democratic-controlled Michigan House voted May 22 to require charter schools to put the name of their authorizer and educational management organization on newly created or altered signs and ads.

e mandate would apply to signs erected, repaired or installed on or after the e ective date of House Bills 5231-5234. It also would cover promotional materials — de ned as billboards and internet, TV and radio ads — created, modi ed or distributed on or after the e ective date along with charters’ websites and enrollment applications.

e House also passed legisla-

tion, HB 5269. It would require charters to post on their website the average salary for new and veteran teachers along with support sta .

“ ese bills are all about increased transparency,” said Rep. Matt Koleszar, D-Plymouth, who is sponsoring the salary measure.

He told reporters new teachers have a right to know what charter schools pay. People, he said, have a right to know the authorizer and EMO.

“To have it readily available and convenient for residents I think is important,” he said.

More than 80% of the state’s 295 charters, or public school academies, contract with companies to oversee their day-to-day operations.

e bills were approved on party

lines, 56-47, and sent to the Democratic-led Senate for consideration. Koleszar called the measures “very light lifts,” noting the Michigan Association of Public School Academies and Michigan Council of Charter School Authorizers are neutral on them. Asked if Democrats, who control the Legislature and the governor’s o ce for the rst time in roughly 40 years, will increase oversight of charters they criticized when Republicans had power, he said “conversations are ongoing.”

Future oversight is “certainly not o the table, but we want to do it in a way that one, has buy-in of the majority of members elected and serving but also, two, is done in a responsible manner.”

Kirk Pinho

The AC Hotel is being developed in conjunction with a $7 million to $10 million renovation of the Bonstelle Theatre immediately to the south. | STANTEC

The AC Hotel (left) being built on Woodward Avenue near Mack Avenue has topped out at 129 feet. | SACHSE CONSTRUCTION

Corktown shines as Eminem, Ross mark station’s return

By Elizabeth Schanz

It was a night to remember June 6 as some 20,000 people and an all-star lineup paid tribute to Detroit, its people and a restored historic train station with a bright future.

Motown star and Detroit native Diana Ross kicked o the “Live from Detroit: e Concert at Michigan Central” show in Roosevelt Park in Detroit’s Corktown neighborhood in front of the real star of the show: Michigan Central, the iconic landmark that for more than three decades loomed as a cautionary tale, was ready for its close-up after an ambitious and massive six-year restoration by owner Ford Motor Co.

Detroit rapper Eminem, who executive produced the June 6 show, closed out the night in a surprise performance backed by the Detroit Symphony Orchestra to the delight of the crowd. All throughout the evening, the performers and presenters shared their love for the city and memories of the old train station and the crowd roared back.

Jack White, Big Sean, e Clark Sisters, Kierra Sheard, Common with Illa J and Slum Village and more gave rousing performances.

Melissa Ethridge, Fantasia and Jelly Roll played a set to pay tribute to local rocker Bob Seger, who was born in Detroit.

Gov. Gretchen Whitmer and Detroit Mayor Mike Duggan were among the crowd, touting the strength and tenacity of the city and its people. “ ... it’s a night of deep pride,” the mayor said.

Actress, investor and activist Sophia Bush announced that she and Nia Linder Batts, her “best friend” and business partner in Union Heritage Ventures, will base their Michigan-focused venture capital rm at Michigan Central.

For the fans who packed into Corktown bars and restaurants June 6 ahead of the show, Michigan Central’s opening-night concert was more than a one-o celebration. It was a milestone.

“It means a lot, because the city is back,” said Phil Berry, a lifelong Detroit resident who arrived with his wife, Monica, at neighboring Mercury Burger Bar some ve hours before showtime.

A self-described “Detroit lifer,” Berry grew up alongside the train station as it fell into disuse and eventually closed in 1988. As a teenager, he heard stories from his mother about catching the train to Chicago from the same building that for him was “a sour spot on the city.”

Now, he sees it as a beacon for Detroit.

“I’m looking for a fantastic concert and for the world to see what Detroit has to o er now,” he said.

Ahead of the show, Ford’s top executives hailed the Dearborn-based automaker’s restoration of the long-derelict Michigan Central Station as a symbol of Detroit’s and the company’s future. e station, part of a $950 million mobility campus project that began with Ford’s 2018 pur-

chase of the 18-story building, had sat vacant since the last train departed in 1988. For three decades its hollowed-out windows and gra ti-covered halls had been a favorite target for scavengers and a symbol of Detroit’s decline.

No longer.

By the end of this year, Ford plans to move 1,000 of its employees into the 111-year-old building, with a total of 2,500 in Corktown by the end of 2028.

“I wanted to make Michigan Central a place where the best and brightest could come to solve our biggest challenges,” Executive Chair Bill Ford told the crowd at the top of the program. “I wanted the future of transportation to be created right here in Detroit, where it was invented in the rst place.”

Starting June 7, the station is open to two weeks of sold-out tours and, gradually, to the general public.

It was a good day for Corktown businesses, too.

As the Berrys left Mercury Burger Bar to line up for the concert, Grandma Bob’s Pizza next door was enforcing a 45-minute dining limit. John Kwiatkowski, a partner in the restaurant, was running around the oor around 5:45 p.m. on what he expected to be the business’ busiest day yet.

“We’ve been absolutely slammed since opening,” Kwiatkowski said. “We’re expecting it to be a record day ... We’re gonna close the doors at midnight tonight compared to our usual 9 p.m. on a ursday.”

with their 1-year-old son, Leo, for his rst concert.

“We’re very excited to be here and celebrate this,” Garcia said. “Honestly, the DSO — I saw them once as a little kid. I’m excited to see them again.”

Tickets for the concert were free and in high demand. All 15,000 were claimed within minutes when registration opened on May 21, Michigan Central spokesperson Dan Austin said. Another 2,500 were dropped Tuesday and quickly snapped up.

Angela Turner, 61, who lives near Belleville, said she “stood in line” waiting for tickets on the Eventbrite website last month and initially struck out, but got a pair

on the second try.

Born and raised in Detroit, Turner is among those who got to experience Michigan Central Station when it was still a functioning train station, taking the trip from Detroit to Kalamazoo and back during college at Western Michigan University.

“(Michigan Central) means a lot for the city of Detroit,” Turner said. “It’s bringing everyone back together. We’re listening to (a) much happier Detroit lately — with the Grand Prix, with the NFL Draft, now this. (We’re) just excited about being in Detroit.”

— Automotive News reporter Michael Martinez contributed to this report.

Detroit rapper Eminem closes out the grand opening night concert at Michigan Central in Corktown on June 6. | PHOTOS BY QUINN BANKS

Motown star and Detroit native Diana Ross said it was good to be home as she performed June 6 at the grand opening concert for Michigan Central.

Jack White, who grew up near Michigan Central Station in Detroit, closes out a rousing set.

Marley Garcia and her husband, Nathan, came from St. Clair Shores

EDITORIAL

Answers are needed in riverfront fraud scandal

The unfolding embezzlement scandal at the Detroit Riverfront Conservancy shouts one question above all. How on earth could this happen?

A federal investigator’s a davit led with charges against the organization’s longtime CFO, William Smith, says he used Conservancy funds to pay personal expenses charged to an American Express account that included home furnishings, travel and jewelry. Helping him to hide his tracks, prosecutors say, was a $5 million line of credit obtained from Citizens Bank in the Conservancy’s name.

e scale of the alleged embezzlement is hard to conceive. Investigators say Smith may have diverted $40 million over more than a decade from the nonpro t. at would amount to more than 10 percent of the roughly $300 million in grants, donations and public funding that the Conservancy has spent since its 2003 creation on building the RiverWalk.

ere is plenty of accountability to be doled out for the scheme, its massive scale and the length of time it allegedly continued. e organization’s top leaders, CEO Mark Wallace and board Chairman Matt Cullen, certainly bear responsibility for the CFO who worked under them.

Wallace took accountability in a public way, resigning his job as the investigation developed. Cullen, who led formation of the Conservancy in 2003 and has donated

COMMENTARY

millions personally to the riverfront e ort, is leaning into day-to-day operations as the Conservancy tries to sort out the mess and x its obvious issues. He has also joined the Ralph C. Wilson Foundation and Kresge Foundation in committing more resources to the conservancy.

e organization’s 44-person board of directors as well should have had a better handle on the group’s nances as well. While certainly they are not going to be scrutinizing every line item, that much money shouldn’t go missing without somebody noticing.

And that’s not to mention the nonprofit’s auditors, Detroit accounting rm George Johnson & Co. Didn’t something not add up over all those years?

Perhaps the scheme and the phony bank statements that investigators say were used to hide it were sophisticated enough to fool experienced auditors and businesspeople.

Court proceedings have yet to play out, of course, and Smith is innocent until proven guilty. But the investigators’ a davit paints a picture of a CFO who operated with little oversight and kept secrets from

his underlings. e details outlined so far are hard to square with an organization that enforces robust nancial controls. e Riverfront Conservancy has been a wild success in meeting its mission of eclaiming Detroit’s riverfront, a postindustrial wasteland not that long ago that has become one of the city’s crown jewels.  e continuing extension of the RiverWalk is crucial to the city, region and state. And as wonderful as it already is, the riverfront still has plenty of potential yet to tap, enough that it could become a globally admired destination on par with Chicago’s lakefront or New York’s Central Park.

To that end, obviously the Conservancy needs some big changes. Reorganization of its massive board of directors, which is studded with local business luminaries with many, many other responsibilities, seems to be in order. Financial controls worthy of an organization of the Conservancy’s size and importance. A strong permanent CEO who brings a track record and trust from the foundation and business communities.

Many questions remain to be answered as the prosecution proceeds.

But not up for dispute: e Riverfront Conservancy is critical to Detroit’s future. It needs to reassure its funders and the general public that it’s an unimpeachable steward of the trust, and money, it has been given.

Inequity in youth arts is a public health issue

As health care leaders in Detroit, we often focus on implementing cutting-edge medical treatments to improve outcomes for children. However, a vital aspect of care is frequently overlooked: the role of arts in promoting healing and well-being.

Both evidence and experience show how the arts can have a therapeutic and preventative impact on the physical and mental health of our youth. We believe that every young person in Detroit deserves access to the arts, and that Detroit’s rich cultural legacy uniquely positions our region to lead a movement dedicated to improving child and adolescent health outcomes through the arts.

engagement, and developing interventions that encourage arts engagement for healthy lifestyles.

Meeting this opportunity will require collaboration across sectors to ensure the arts are equitably accessible to all young people.

Consider the story of Jasmine Rivera. Diagnosed at age 2 with Marfan syndrome, severe arrhythmia and cardiac dysfunction, Jasmine spent much of her childhood in Children’s Hospital of Michigan. Her life changed when she discovered the arts at age 7.

“Art set me free from my physical limitations, creating a sense of progress and improvement while my health remained uncertain,” she says. Even though doctors predicted she wouldn’t live past her teens, Jasmine, now in her 40s, is an award-

winning lmmaker and social justice leader. She credits art for her survival, stating, “Art teaches us to value life and ght for it. e young artist with chronic illness can paint, sing, or dance her way toward a dream of a better future.”

Jasmine’s experience aligns with a 2019 World Health Organization report that found extensive evidence the arts can impact both mental and physical health.

e report cited more than 3,000 studies showing the arts’ role in preventative health, as well as managing and treating illness. e WHO recommends recognizing the health value of arts engagement by ensuring culturally diverse arts are accessible to all, integrating health and wellbeing into arts organizations’ goals, promoting awareness of the bene ts of arts

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With the need for an entity to bring people together to focus on this issue, we are enthusiastic about the new initiative, Detroit Excellence in Youth Arts. Co-founded by Michigan Arts and Culture Council member Nafeesah Symonette and Mosaic Youth eatre of Detroit founder Rick Sperling, DEYA catalyzes cross-sector collaboration to ensure equitable access to Detroit’s rich cultural legacy and the transformative power of the arts. By working with youth arts providers, teaching artists, and arts educators, DEYA mobilizes stakeholders to address inequity and ensure Detroit youth can access these essential resources.

We are encouraged by the support of Mayor Mike Duggan and Dr. Nikolai Vitti, superintendent of Detroit Public Schools Community District, for DEYA’s e orts — as a philanthropic intermediary, network builder, advocate, and research partner — to strengthen Detroit’s vibrant youth arts sector. DEYA’s key strategies include developing “collaborative platforms” where multiple providers collaborate to o er expanded youth arts opportunities.

One such platform, Youth Arts by Prescription (YaRx), was piloted at Children’s Hospital of Michigan in 2023. Funded by the

Send

Children’s Foundation and MACC, YaRx provided live arts experiences for young patients, including West African drumming, mural painting, music, poetry and storytelling. ese sessions allowed young people to explore their creativity while in the hospital or visiting their doctor.

Platforms like YaRx in health care settings are powerful, and yet they are only part of the solution. According to a 2022 follow-up WHO report, “ e arts are multimodal, combining physical, emotional, cognitive, psychological, and social benets.” Pediatrician Elliott Attisha, senior fellow for health at Attendance Works and former chief health o cer at DPSCD, notes that the arts can help schools combat chronic absenteeism by creating “environments that support children’s overall well-being, which research shows makes students more likely to show up.”

DEYA, with funding from the National Endowment for the Arts, will launch the Detroit Partnership for Arts Education, a cross-sector committee including representatives from corporate, K-12 schools, higher education, nonpro t, government, community development, and youth development sectors. e DPAE will develop a citywide arts education plan, and we are excited to represent the health care industry on this committee. We encourage corporate leaders in all industries to join us. Sound off: Crain’s considers longer opinion pieces from guest writers on issues of interest to business readers. Email ideas to Managing Editor Michael Lee at malee@crain.com.

The RiverWalk project over two decades has reclaimed what was a post-industrial wasteland and transformed it into public space. | DETROIT RIVERFRONT CONSERVANCY

Bob Riney is the president and CEO of Henry Ford Health; Archie Drake is the CEO of the Children’s Hospital of Michigan; and Dr. Herman Gray is the chair of the pediatrics department at Wayne State University’s School of Medicine.

3 affordable housing projects get a boost from state

By Nick Manes

ree Detroit housing developments, each with an a ordable component, have received gap funding from the state’s main housing agency.

e board of the Michigan State Housing Development Authority in May announced the funding for the projects scattered around the city, totaling more than $74 million in total investment.

“ e developments approved by the Board (last) month will have a large impact on some of Detroit’s most vulnerable residents,” Amy Hovey, CEO and executive director at MSHDA, said in a news release. “Projects like these re ect our mission of partnering to provide quality a ordable housing.”

Such projects generally rely on ample and myriad funding sources, often called “capital stacks” by developers.

Minock Park Place

Minock Park Place is a proposed $22 million mixed-use development in northwest Detroit’s Grandmont Rosedale neighborhood. e housing component for seniors — which received a total of $12.8 million in loans from various programs administered by MSHDA — would o er 36

one-bedroom apartments and six two-bedroom apartments.

Twenty-four of the units will be available to tenants earning 60% or less of AMI ($39,780 for one person in Wayne County), while the other 18 units will be for tenants earning 50% or less of the AMI ($33,150 for one person in Wayne County).

e ground- oor commercial area will comprise 5,400 square feet, two residential amenity spaces and a leasing o ce, according to a MSHDA memo outlining the project.

e project is being developed by the nonpro t Grandmont Rosedale Development Corp.

Construction is expected to be complete in September 2025, ac-

cording to MSHDA.

Peterboro Place Apartments

A $16.1 million renovation is planned for the Peterboro Place Apartments in Detroit’s Midtown neighborhood, just west of Woodward Avenue. e 100-year-old building will provide 70 units of permanent supportive housing for homeless residents and other “vulnerable individuals,” according to an MSHDA release.

e state’s housing agency awarded the developers — an afliate of Premier Property Management LLC in Fenton — a total of $14.7 million in various loans and gap funding, per the MSHDA brie ng memo.

e developer plans a long list of renovations, including repaving the parking lot, replacing windows and doors and installation of air conditioning.

Construction is expected to be complete by September 2025, and minimal tenant disruptions are expected.

Higginbotham School

Developers are moving forward with the renovation of a vacant former school in northwest Detroit into multi-family housing.

Detroit-based Urge Development Group plans a $36 million project at the site near Eight Mile and Wyoming roads. e project will consist of two new three-story

buildings and rehabilitation of the former school.

All told, the development will have 100 units, with 10 units designated as Accessible Type A Units (for those requiring a wheelchair), and 37 designated as visitable units, a term for a residential unit that can be lived in or visited by people who have trouble with steps or who use wheelchairs or walkers, according to the National Council on Independent Living.

All units will be reserved for tenants earning 30%-80% of the area median income, which is $19,890-$53,040 for one person in Wayne County. e project is expected to be completed by April 2026, according to MSHDA documents.

At left: The former Higginbotham School in northwest Detroit is slated for redevelopment. At right: Developers plan a four-story mixed-use development along Grand River Avenue in Detroit’s Grandmont Rosedale neighborhood in northwest Detroit. | KIRK PINHO AND GRANDMONT ROSEDALE DEVELOPMENT CORP.

Startup helps sell leftover food at deep discounts

If you could buy $18 worth of pastries for 70% o , would you? What about a full dinner for only $6? What if you had no idea what you were going to get?

e founders of Too Good To Go are betting you would. Internationally, they have been right again and again.

Too Good To Go, an app-based startup founded and headquartered in Copenhagen, Denmark, by Lucie Basch and Jamie Crummie, is expanding to Detroit. e premise is simple: a restaurant or grocery store can sell its leftover food for the day, or would-be food waste, at a minimum of 70% discount to reduce the amount of food waste in land lls and o er a fun and a ordable option to consumers.

“At the start, the goal was really just to reduce food waste and be sustainable. It was the businesses who said to us, ‘Hey, if I can make some money o of this, if I can sell it even at a discount, it helps me recover some lost revenue,’’ Sarah Sotero , senior public relations manager of Too Good To Go, said. “So we started to evolve through that and then o ered the food at a steep discount, because consumers don’t know exactly what they’re gonna get; it is food that is still perfectly good to eat, is probably being sold at the end of its lifespan and the consumer has to go and pick it up.”

e company, which Sotero said is in the “scale-up” stage in the United States, o cially launched in Detroit on June 5,

though more than 60 companies in the Detroit area have already registered to be on the app.

Local restaurants include Mootz Pizzeria, Detroit Institute of Bagels, La Ventana Cafe, Go Sy ai, e Roost, Yum Village and Oak House Deli.

Dessert Oasis Co ee Roasters, which has locations in Ferndale, Royal Oak, Rochester and Detroit, has registered all four locations on the app.

“All four of our locations do have food waste, some more than others. In Ferndale we have the bakery, so there’s some leftover items, maybe things that are a little imperfect that we couldn’t sell for full price anyways,” said Christian Kettenbiel, director of nance for Dessert Oasis. “ at was the rst big obvious one. And then it just made sense to kind of get the other ones on board even if it was a lower volume, but the (Too Good To Go) footprints around the country really made it easy to onboard everybody.”

e Ferndale location gets the most use, Kettenbeil said, due to the baked goods and roastery attached to the Dessert Oasis headquarters.

During the last half hour of each day, customers can buy a surprise bag of baked goods for $6. at includes mu ns, cookies, croissants, cheesecake and more, said Nathan Hamood, president and director of co ee at Dessert Oasis. Co ee beans that are more than three weeks old will also be up for sale through Too Good To Go.  Too Good To Go entered the U.S. market in New York in 2020

and expanded to Chicago, Boston, Philadelphia, Washington D.C., and 23 other cities in the U.S. Businesses registered, which can include restaurants and grocery stores, are required to mark down food sold through the app at a minimum of 70%.

Too Good To Go takes a $1.79 fee from each bag that is purchased by a consumer. Bags can include curated meals by the partnered businesses or “surprise bags,” which Dessert Oasis Co ee Roasters lls with baked goods and pastries at the end of every day. e restaurant joined the app at the beginning of May and has sold out every day so far, Kettenbiel said.

Hamood thinks that may be a testament to Too Good To Go’s popularity in a market where it hadn’t even been formally introduced yet. Dessert Oasis doesn’t even have a sign in its stores signaling the new pick-up service.

And the adoption of the program has added little, if any, extra work to the Dessert Oasis team’s daily tasks.

“It’s pretty seamless for our team. I feel like it’s time when they

would have been throwing out the product and waste logging the product anyway,” Hamood said. “We keep waste logs to make sure we’re tracking it and then toss those and clean out the bins that they were in and things like that. So it’s just changing what they’re doing with that time, really. Too Good To Go has really made a pretty clean platform that makes it relatively easy for us to execute on.”

Users can also sort meals on the app by dietary preference, distance and more. Partnered businesses choose the times of day that consumers can pick up their Too Good To Go bags.

Sotero said the startup is still private and is in hyper-expansion mode throughout the U.S. It aims to break even by the end of next year. Since entering the U.S., the company claims it has helped consumers save more than $113 million on food and helped businesses earn $36.4 million on food that would otherwise go to waste.

“Our goal is to be live, we hope, by the end of next year in every market in the U.S., but probably not Alaska and Hawaii,” Sotero

said. “And the reason for that is because obviously food waste and the climate don’t have any borders. So it’s mutually bene cial for us to be live in as many cities as possible so we can save as much food from as many places as possible. And our goal is to have a world without food waste and to do that, we’ve got to be available everywhere.”

While Too Good To Go is ocially launching in Detroit, Sotero the company considers itself to be “live across Michigan,” and is interested in partnering with businesses in more cities across the state. Businesses can continue to register even after the o cial launch, and Sotero hopes they do.

“We want every single food selling business in the country on the app, so it can be anything from a gas station convenience store, to a high-end restaurant, to a grocery store, to a mom and pop place, to a gift shop that maybe has art but also baked goods,” Sotero said. “Everywhere that sells food has surplus food waste, so we want to be able to reduce that food waste everywhere that it occurs.”

Matrix Human Services CEO to retire; successor named

Sherri Welch

Matrix Human Services’ President and CEO Brad Coulter is set to retire later this year.

e organization has named COO Starr Allen-Pettway to succeed him in November.

Coulter, 64, joined Matrix in 2016 after serving as emergency manager for the city of Lincoln Park and holding top roles with turnaround rms O’Keefe and Amherst Partners and nancial positions with Guardian Industries and General Motors Co.  When he joined the organization, Matrix was near insolvency and operating with an unprofessional management structure. Matrix has since grown from $40 million to $60 million in revenue. It has a $15 million fund balance and no debt, the nonpro t said.

e organization has expanded its impact in Detroit by adding workforce training, housing coun-

seling, and other services needed by the community.

e year after Coulter joined Detroit-based Matrix, the agency — and three other local Head Start providers — was required to recompete for Head Start funding after scoring in the lowest 10% nationally in a federal evaluation that experts questioned and the government reassessed as a measurement of provider quality and e ectiveness.

e loss of the contract would

have hollowed out the organization and disrupted early education for the families participating in Matrix Head Start programs.

As one of Detroit’s largest Head Start providers, 70% of its $53.8 budget in 2022 was tied to its federal Head Start contract and provider status.

Under Coulter’s direction, the agency requali ed for the funding and continues to serve as a Head Start provider, while also providing services from birth to senior

citizen status in other areas including: teen counseling and activities, adult services for education, nancial literacy, workforce development and HIV outreach and counseling.

During his tenure at the agency, Coulter has focused on diversity as head of Matrix, ensuring Matrix’s sta mirrors the people it serves.

For those e orts, he was named among Crain’s 2021 Notable Executives in Diversity, Equity, and Inclusion.

Allen-Pettway, 46, will succeed him, bringing a background in child welfare and health care. She joined Matrix as COO last August.

Prior to that, she was the founder of Sisters Standing Strong LLC, a sponsorship-based program providing women with services to help address issues in areas including parenting, substance abuse, domestic violence and nances.

During her career Allen-Pettway also served as branch director of

Bethany Christian Services in Madison Heights, as lead behavioral health system therapist at the AIDS Partnership of Michigan, as COO at Downriver Community Services, and as executive director of Homeless Healthcare, among other roles.

She holds a master’s degree in social work with a concentration in mental health from Howard University and a bachelor’s degree in psychology from Bennett College.

“Starr Allen-Pettway’s leadership qualities, her deep connection to our mission, and her visionary approach to service make her the ideal incoming leader for Matrix,” Coulter said in a release. “She has the sophistication required to run a $60 million per year non-pro t with over 70 funding streams. Her experience combined with a heartfelt dedication to the community is an invaluable asset for leading Matrix Human Services into the future.”

Denmark-headquartered

Anna Fifelski

Brad Coulter and Starr Allen-Pettway of Matrix Human Services. | MATRIX HUMAN SERVICES

Metro home values slowed in March

By Nick Manes

Home values in metro Detroit continue to outpace the broader nation, but the price escalation seen in Southeast Michigan for several months cooled slightly in March, according to a new report.

e monthly S&P CoreLogic Case-Shiller index, released May 28, tracks home values around the largest metro areas around the country using a value-weighted index. Metro Detroit, per the report, again outpaced the broader country with home values in the region growing 7.7% in March from a year earlier.

Nationally, home values increased 6.5% from a year earlier, according to the Case-Shiller report.

Last month’s Case-Shiller report shows San Diego, New York, Miami, Los Angeles, Cleveland, Chicago and Boston saw home values increase by 8% or more from a year earlier. Values in San Diego were up 11% from the same time last year, per the Case-Shiller gures.

e Northeast, however, is the “top performer,” according to Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices.

“COVID was a boon for Sunbelt markets, but the bigger gains the last couple of years have been the northern metro cities,” Luke said

►

►

►

in a statement.

Southeast Michigan led the nation in the growth of home prices for three straight months toward the end of last year, but lost that title in early 2024. At present, metro Detroit stands at 182 basis points on the Case-Shiller data, the lowest on the index, meaning homes in the region have appreciated the least of any major metro area.

Still, home values have ticked up about 55 basis points since January 2020 on the Case-Shiller index. Overall, the 20 metros around the country tracked by the index have shown about 106 points of growth over the same period.

Month-over-month, metro Detroit home values ticked up 1.1% from February. At that time, home prices were up nearly 9% from a year earlier.

Overall, the measure of 20 cities was up 0.3% in March from a month earlier, lower than the 0.6% increase in February, according to a seasonally adjusted measure.

“Given the surge in mortgage rates between the end of March and the beginning of May, we expect both home-price growth, inventory, and home sales to moderate in future housing market data releases,” Realtor.com Senior Economist Ralph McLaughlin said in a statement.

—Bloomberg contributed to this report.

Michigan’s rst PGA Tour Superstore sets opening date

By Kurt Nagl

Michigan golf fanatics will soon have a new outlet as the state’s rst PGA Tour Superstore gears up to open in Novi.

e store at 21061 Haggerty Road will open its doors at 9 a.m. on July 27, welcoming patrons into 42,000 square feet of golf-centric retail, plus tennis and pickleball gear, the company announced May 21.

e Roswell, Ga.-based retailer will take the place of a closed Dick’s Sporting Goods — a golf retail competitor — in the High Pointe Shopping Center at Eight

Mile and Haggerty roads, Crain’s previously reported.

e PGA Tour Superstore will feature a 1,333-square-foot practice green where customers can test putters, as well as four hitting bays where they can hit into simulator screens, according to a news release.

e store o ers club regripping, repairs and shaft adjustments, as well as club tting and lessons from certi ed teaching pros.

“Michigan is one of the leading golf destinations in the country and as a Detroit native, I’m thrilled we are about to be a part of this special community,” Jill

Spiegel, president of PGA Tour Superstore, said in the release. e store is expected to employ more than 40 full- and part-time employees, and the build-out cost is north of $2 million, a store manager told Crain’s in December.

PGA Tour Superstore is the professional golf tour’s “exclusive ocourse/o -airport retail partner” in North America, with more than 60 locations across 25 states, according to its website.

Competitors in the market include Carl’s Gol and, Dick’s Sporting Goods, Golfsmith Detroit, Nevada Bob’s and Discount Golf.

BLOOMBERG

PGA Tour Superstore is opening its rst Michigan location in a former Dick’s Sporting Goods store in Novi. | PGA TOUR SUPERSTORE

Restaurant inspired by Jackson Pollock plans June opening

By Jay Davis

A new restaurant slated to open this month at e Village of Rochester Hills has an interesting hook.

e Jackson is a project from Michigan natives Michael Mauro and chef Justin Vaiciunas, their rst venture into restaurant ownership.

e two men met in Dallas while working at Hotel Swexsan.

e restaurant, in a 2,500-squarefoot space that previously housed a Noodles & Company, will pay homage to American abstract expressionist artist Jackson Pollock and feature items as creative as the eatery’s namesake.

e interior and menu of e Jackson is inspired by Pollock’s splatter paintings. e restaurant’s ambiance and aesthetic are in uenced by Pollock’s 1950 piece, “Number One (Lavender Mist).” Vaiciunas and Mauro created a 21-by7-foot site-speci c mural featuring their interpretation of “Number One.”

Vaiciunas said the space will feature six Pollock-like paintings done

by himself and Mauro.

“We’re huge fans of art. We didn’t want something quirky with no depth, though,” he said. “We wanted to utilize art and the use of color to go with the food and drinks.”

e use of colors will be noticed quickly by guests.

All of the plates used at e Jackson are di erent colors and styles, as each plate goes with a speci c dish. Lighting inside the restaurant features di erent colors, too.

“ ese are all very fun things you’d normally see in New York, Chicago, Miami,” Mauro said.

Detroit-based Pophouse Design, owned by Jennifer Gilbert, is handling the restaurant design. Custom-made wallpaper paying hom-

age to artist Pablo Picasso is being crafted by Bloom eld Hills-based Verna Velin.

e team is investing about $500,000 into the restaurant. Vaiciunas projects $1.8 million-$2 million in annual revenue.

e Jackson will o er an artistic take on food and drinks. Vaiciunas, from Rochester Hills, is crafting a menu focusing on artistic presentation, seasonal o erings and local food sourcing. e dishes are designed to be shared and will be served as soon as they are prepared. Highlighted dishes include caviar, beef tartare with tru es, snapper wrapped in banana leaf and chorizo-stu ed dates.

Brunch will be o ered on week-

ends. e food and drink menus will change twice a year, according to Mauro.

East Lansing native Mauro, beverage manager at e Jackson, is curating a selection of new- and old-world wines as well as elevated cocktails. Mauro holds sommelier certi cates from the Court of Master Sommeliers, Wine and Spirit Education and the Sake Service Institute of Japan.

e Jackson has seating for 78, including eight seats at its bar. It will have a sta of 20. Ownership conducted open interviews and hopes to have the sta in place this week.

e Jackson will join a lineup at e Village of Rochester Hills, owned by Robert B. Aikens and As-

Vaiciunas believes e Jackson will bring an elevated experience to the area.

“When people want to go to a (James Beard Awards) nominated restaurant, they have to drive 45 minutes to Detroit,” Vaiciunas said. “And once you leave Birmingham, you really see a lot more corporate-focused restaurants. We’re an independent, service- and experience-driven restaurant. We’re bringing the types of things you’d have to go to the big city for to the suburbs.”

sociates, that includes Bravo Italian Kitchen, Kruse & Muer, Mitchell’s Fish Market, P. F. Chang’s China Bistro, Shake Shack, Chipotle and e Jagged Fork.

A rendering of the dining room inside The Jackson restaurant in Rochester Hills. POPHOUSE

Justin Vaiciunas Michael Mauro

Tech economy seen as a driver for population growth

By Anna Fifelski

Michigan leaders are hoping the state’s blossoming startup community in metro Detroit can help contribute to statewide population growth.

While the startup community plays a large role in attracting new talent to the state, Hilary Doe, chief growth and marketing o cer for the Michigan Economic Development Corp., said the state’s growth plan rst and foremost should involve retention of current young people in the state.

“We have to be sure we’re building communities, opportunities in Michigan that work for the young people and for our workers and families here,” Doe said.

Doe was among a panel at a May 23 Pancakes and Politics event hosted by the Michigan Chronicle discussing support systems for thriving technology and innovation cultures alongside speakers Lt. Gov. Garlin Gilchrist III, Black Tech Saturdays co-founder Johnnie Turnage and Michigan Central CEO Josh Sirefman. e panel was moderated by sixteen42 Ventures chairman and CEO Dennis Archer Jr. In order to retain and attract entrepreneurs, there needs to be policy in place that allows them to thrive, Gilchrist said. In Octo-

ber, the state awarded four nonprofits with a total of $18 million to invest in the startup ecosystem through the Michigan Innovate Capital Fund. In April, the Michigan Economic Development Corp. and InvestUP created a $250,000 Michigan Outdoor Innovation Fund.

e state also awarded University of Michigan Innovation Partnerships $5 million to establish a statewide venture fund and university consortium. Whitmer is currently seeking $60 million to launch the Michigan Innovation Fund to invest in startups. Two lawmakers countered with a proposal of $105 million.

ere’s no shortage of interest from the state in fostering innovation in the state of Michigan, but that’s only one part of the developing ecosystem in Michigan. Sirefman wants Michigan Central to be a world leader in technological advancements.

“We launched the rst part a little over a year ago, Newlab at Michigan Central, and we’re up to 100 companies,” Sirefman said. “40% of those are coming from elsewhere in the country and around the world. It’s an example of people coming from literally every market … whether it’s Atlanta, whether it’s Austin, and over half of companies are led by women

and, or, have people of color founders and CEOs.”

Turnage said he anticipated “a lot of friction” when the couple decided to bring their startup, a impact-focused donation platform, EvenScore, to Detroit, but after an Tech Week event in Houston, he “learned not only about Michigan’s tech ecosystem, but some of the gaps of experiences,” he said.

After that, it was easy for him to determine what he needed to do.

What Turnage and his wife, Alexa Turnage, are most known for, however, is the founding of Black Tech Saturdays, which began in April 2023 a way to foster a community of Black founders in Detroit. Originally from Houston, Texas, they didn’t think that Michigan would be a good t for their startup because of the limited venture capital available. e Black Tech Saturdays events take place every Saturday at Newlab at Michigan Central, and have fostered a

community following of tech entrepreneurs.

at kind of social support is critical in population growth, Doe said.

“We have to be cognizant that folks want great opportunities, great places and welcoming communities — all three parts of that are critical,” Doe said. “And Michigan punches above its weight in terms of welcoming communities. We’ve made incredible strides there.”

Through the power of listening, perspective, and connected purpose, we work with you to achieve your unique goals. We walk beside you, navigating challenges and opportunities so you can focus on what you do best. We are your business success partner.

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Detroit48243 313-394-6000; pwc.com

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REHMANNLLC Grand Rapids49546 616-975-4100; rehmann.com

Troy48084 248-244-3000; doeren.com

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ResearchedbySonyaD.Hill:shill@crain.com|Thislistofaccounting rmsisanapproximatecompilationofthelargestsuchcompaniesinMichigan.Itisnotacompletelistingbutthemostcomprehensive available.Unlessotherwisenoted,informationwasprovidedbythecompanies.CompanieswithheadquarterselsewherearelistedwiththeaddressandtopexecutiveoftheirmainMichiganof ce.NA= not available. e. Crain's estimate. 1. To be succeeded by Jason Drake as managing partner, effective July 1, 2024. 2. Clayton & McKervey PC merged with Wip i LLP, effective Sept. 1, 2023. Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data

Nation’s largest independent electric transmission company leads a ‘safety transformation’

ITC leader shares keys to keeping community, employees safe, on and off the job

By Crain’s Content Studio

ASHLEY SIMPSON

Simpson is Director of Safety, Protection and Preparedness at ITC Holdings Corp., the largest independent electricity transmission company in the United States. In this role, Ashley is responsible for leading all aspects of the company’s safety, human performance, physical security and emergency preparedness functions.

Prior to this role, Ashley led ITC’s Inclusion & Diversity strategy, plans and programs to enable and enhance diversity across the enterprise, and to enable and facilitate an engaged, inclusive culture re ecting the communities ITC serves.

In honor of June being National Safety Month, it’s critical to practice situational awareness when encountering summer storms, reworks and other outdoor safety hazards. Ashley Simpson, the director of safety, corporate security and emergency preparedness for ITC, shares best practices for the community, ITC employees and contractors in this Crains’ “Quick Take” interview.

Crain’s Content Studio: What is ITC’s safety philosophy?

Simpson: When it comes to health and safety at ITC, we don’t take any days o . We think about safety for all employees, and we believe that safety doesn’t just stop on the job — it’s o the job, too. By working together and learning from each other, we prevent injuries from occurring.

At ITC, we have six major focus areas when it comes to safety:

• We care about each other. We respect and have genuine concern for the health, safety and well-being of those around us. Nothing is so urgent that we cannot take the necessary steps to do it safely.

• We lead by example. We take personal responsibility for our own safety and understand that our actions, inactions and mindfulness impacts others. We are committed to only starting work when it is safe to do so and to stop if we have any safety concerns.

• We take action. We have the courage to speak up and intervene if we see unsafe work and we are openminded and respectful to others when they approach us with feedback that improves safety.

• We are committed to learning and prevention. We believe that all injuries are preventable. By staying engaged with health and safety information, we will continue to learn and improve.

• We report safety incidents. at includes all near misses and good catches. We believe sharing facts and stories supports a positive safety culture.

• We are dedicated to continuous improvement. We review all incidents and make safety improvements based on what we learn from each situation.

Crain’s: How did your career path shape your current approach to safety at ITC?

Simpson: As an electrical engineer, I started my career at another utility

and spent a great deal of time in the eld. One of my roles was at a nuclear plant, where safety was paramount. is early career exposure to eld and plant work shaped my views about the risks associated with the

We invite all employees and contractors to be a participant in this process because it allows us to be successful, so that if something does go wrong, we can fail safely. is is crucial because at the end of the day,

“We can strengthen our safety practices because of the feedback loop we have with employees and contractors.”

-Ashley Simpson

work we do. Now at ITC, I lean on those experiences to help shape our approach to safety. In my role, I am responsible for leading all aspects of the company’s safety, human performance, physical security and emergency preparedness functions.

Crain’s: Under your leadership at ITC, what have you done to prioritize safety, and why is this critical the company?

Simpson: I’m leading a safety transformation, focusing on shi ing our culture from traditional compliance-based safety. Out in the eld or even in the o ce, if people are seeing something, they’re saying something. We can strengthen our safety practices because of the feedback loop we have with employees and contractors.

we want everyone to go home safe. is can be re ected within our safety goals as well — we have a phenomenal safety record because we have instituted this shi .

Crain’s: What advice do you have for the public regarding safety?

Simpson: With the summer and the holidays coming up, I encourage people to maintain situational awareness. Fourth of July is coming up — you’ll want to make sure you’re looking up to see what’s around you and you’re not aiming reworks toward a power line. Also, consider kites and mylar balloons — all those things can have adverse impact.

From a situational awareness standpoint, we have a lot of storms in

the summer, and those storms impact electric infrastructure. Whenever you see a downed power line, assume that it’s live and don’t touch it. If you encounter a downed wire, call 911 or your local utility.

Also, if you see someone working out in the eld near you, be mindful — we need your support to do our jobs. By working together, we can ensure a safe, secure and reliable grid for all.

Scan the code to watch the entire Quick Take interview with Ashley Simpson:

Family-run rm rides the EV boom to 240% revenue swell

By Dustin Walsh

Growth for Clawson-based contractor Progressive Mechanical Inc. is electrifying.

e industrial piping, plumbing and process contractor is riding the wave of electrical vehicle manufacturing investment across the U.S. to the tune of hundreds of millions of dollars in new revenue. But these new opportunities come with new challenges as the family-owned company is managing meteoric growth, adding business sophistication into the organization.

“ ere’s no manual that says when you go from this volume to where we are now,” said Randy Holser, president and co-founder of the company along with his nephew, Charles Holser, as executive vice president. “Nope, we’re learning as we go every day.”

Progressive Mechanical’s revenue spiked more than 240% last

year to $358.1 million from $105.2 million in 2022. e contractor is a major player

in the construction of the roughly 3 million-square-foot, $2.5 billion electric vehicle plant for Stellantis and Samsung SDI. It’s also a sub-

PEOPLE ON THE MOVE

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

ENGINEERING / DESIGN

Spalding DeDecker

COMPANIES ON THE MOVE

contractor for Toyota’s $8 billion investment to expand electric vehicle production in North Carolina with two new plants.  e boon for electric vehicle and battery production stems from the 2022 In ation Reduction Act, passed by Congress to not only deal with rampant in ation but to spur clean energy initiatives. Under the act, battery makers receive production credits for producing battery cells and modules in the U.S. e total value of those credits is estimated at nearly $200 billion, leading to a ramp-up in battery plan investment.

sive and others are the bene ciaries of that.”

But growth like Progressive’s doesn’t come without increased risk. Randy Hosler and Progressive are embracing the EV high wire but don’t want to get shocked.

Suddenly, typical raw materials orders are in magnitudes larger than in previous years, growing input costs higher than revenue had been in the years’ past, Randy Hosler said.

“When your jobs grow like this, nobody has the nancial wherewithal to manage it,”  Hosler said. “We’ve had to manage and adjust payments terms because of the costs. We’re not banks.”

Progressive has also tripled its workforce in the last 12 months, from 200 employees to roughly 600.  at means more advanced and intensive payroll, which meant having to double its o ce sta .

“Our payroll goes out every week and then the fringes (health care premiums, union payments, etc.) go out once a month,” Hosler said. “ ere’s been a lot of sleepless nights worrying we wouldn’t get all this right.”

But Randy Hosler and the company have gotten it right — and the work they do on construction sites is leading to more jobs. Outside of the battery plants, the company is also working on mission-critical data centers at sites in Ohio.

NONPROFIT DEVELOPMENT

Downtown Detroit Partnership

Jacqueline Cooks! jacquelinecooks.com

The Downtown Detroit Partnership (DDP) welcomes Sharon Garcia as Vice President of Marketing and Communications. Sharon will lead the DDP’s marketing, communications, digital and brand recognition strategies; and will work with media to share DDP’s story, mission, vision and core values to drive awareness of the role the organization plays in Detroit. In her role, Sharon will provide leadership to advance the corporate messaging and brand management strategy across all DDP business units.

To place your listing, visit www.detroitbusiness.com/companymoves or contact Debora Stein at 917.226.5470 / dstein@crain.com

CallHarbor callharbor.com

Classically French-trained chef Jacqueline Laurencelle and EMMY Award winning producer/director Gary May announced they are teaming to create a new television cooking series and cooking/ health-oriented content for local news broadcasts.

Laurencelle and May are also developing a syndicated cooking show, Jacqueline Cooks!, that will launch in September. “My goal is to inspire others to live joyfully by making healthy cooking and eating accessible, fun, and always delicious,” said Laurencelle.

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CallHarbor, a Michiganbased leading provider of cloud-based communication solutions, announces the acquisition of RingGenius, the voice division of Propel Technologies. This strategic move solidi es CallHarbor’s position in the evolving market, expanding its customer reach.

Construction companies dominated growth on the Crain’s Private 200 list, which ranks the largest privately-held companies in Michigan. South eld-based general contractor Barton Malow ranked second on the list with revenue of $6.5 billion in 2023, an increase of 34.5% from the year prior. Detroit-based general contractor Walbridge ranked third with revenue of $6 billion, up 65.2% from 2022. Auburn Hillsbased Commercial Contracting Corp. reported revenue of $1 billion, up 63.4% from the year prior.

Progressive ranked 62nd on the list.

Ryan Maibach, president and CEO of Barton Malow, said construction companies are overindexing in growth for two reasons.

While its growth in 2023 was impressive, Progressive is going to e ectively double that this year with projected revenue between $700 million and $800 million, Randy Hosler said.

“ e nancial side of this growth has been signi cant,” he said. “We have had to really upgrade and get our nancial team rounded out. Everything revolves around the nancial part of the business. If we don’t manage that properly, we’re in trouble.”  e company has also expanded its internship program in hopes of clearing up any labor pipeline issues that occur during such rapid growth.

Randy Hosler said the program was designed to “feed our projects with new, young talent.”

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President Travis Waye emphasizes the milestone in their growth journey. “This acquisition demonstrates our dedication to providing exceptional communication solutions and personalized support to Michigan businesses,” says Waye. CallHarbor’s strategic focus on expanding its market presence in Michigan through targeted acquisitions like RingGenius re ects its dedication to delivering unparalleled communication solutions and support to businesses in the region.

“One is the cost of construction increased quite rapidly over the last few years, greater than consumer in ation,” Maibach wrote in an email to Crain’s. “A part of what drove that is a massive increase in investment in new manufacturing particularly in battery manufacturing. at was the primary component of our revenue growth as well as some of the other industrial contractors on your list. Specialty trades like Progres-

It’s all part of the evolution of the company, he said.

As the company grows, and its senior employees age, they are having to take on more leadership roles and train new sta on the day-to-day tasks.

“We’ve had to adapt as owners and leaders,” Hosler said. “It can’t just be (Charles) and I. We need to train and elevate the individuals in our organization rather than getting the day-to-day grind.”

Progressive Mechanical Inc. Executive Vice President Charles Hosler (left) and President Randy Hosler are managing meteoric growth at their Clawson business. NIC ANTAYA

The StarPlus Energy EV battery plant, a joint venture between Stellantis and Samsung, is under construction in Kokomo, Ind. ALAMY

$40M bridge housing campus opens

Pope Francis Center has completed a new $40 million transitional housing site for the homeless in Detroit’s Core City neighborhood.

It funded the site through private donations and state and city funding but did not seek support from the U.S. Department of Housing and Urban Development given its focus on transitional housing rather than the permanent supportive housing- rst approach the federal agency has adopted as the best path to ending homelessness.

Now, as it opens the Bridge Housing Campus this month, the center is counting heavily on private donors to help maintain and operate it.

e Bridge Housing Campus is borrowing best practices from other shelters and homeless services providers around the country, including a heated outdoor shelter for those who aren’t yet ready to go into even transitional housing. e site o ers transitional housing with stays of about 90-120 days to get people ready to go into permanent housing through a variety of wraparound supports and education.

Amenities on the 5.3-acre campus include health/dental clinics, a gymnasium and computer lab, which will be open to guests staying there as well as the public to help encourage socialization and remove stigmas.

e transitional housing model di ers from the housing- rst approach HUD favors, with the Detroit Continuum of Care and peer agencies around the country deploying housing assistance funds that align with that.

“We don’t t neatly into that, but I do think that once they see our success … they might begin to help us,” the Rev. Tim McCabe, president and CEO of the Pope Francis Center, said during a tour last month. “We want to start having conversations with folks in Washington about this… when we try to template a solution, we lose the game because there’s so many reasons why people are homeless.”

Fundraising success

e center has raised $37 million of its $40 million goal for the new campus, with signi cant private support from donors including the Julia Burke Foundation with the lead $13 million gift, Ford Motor Co., Magna Corp., Lear Corp., Piston Group, Midwest Province of the Society of Jesus, e Pulte Family Charitable Foundation, J. Addison and Marion M. Bartush Family Foundation, the state of Michigan and city of Detroit.

Of the total raised through the campaign, $3 million will go to support operations. e center is taking out a bridge loan of about $3 million to cover pledge payments committed over multiple years, McCabe said.

“We have not had to borrow money until (last) month. Some of our donors accelerated their payments and their commitments so

that we could save money on interest as interest rates went up,” said Pope Francis Center Chairman Jim Vella, CEO of the Vella Group and retired president of the Ford Motor Company Fund (now Ford Philanthropy). “So we have been able to save a signi cant amount on the project by not having to borrow money we originally anticipated we would have to borrow back in September. So every time we have gone to donors, they have said, ‘We are with you, and we are going to stay with you.’”

e center’s board is now talking about an endowment campaign to take some of the pressure o of annual operating fundraising.

“We’ve really been successful and there’s a whole lot of funding that comes with the shelter transitional housing piece that we weren’t eligible for before because we didn’t have the overnight facility,” Vella said. “We’ve done our research (and) looked into di erent models of the ways in which we encourage people to become nancially involved, and I’m very, very con dent based on that information that we will be able to meet our annual operating expenses.”

Rapid growth

e center’s ability to raise tens of millions of dollars in just a few years’ time is notable, given that it was operating its day center for the homeless in the basement of Saints Peter and Paul Jesuit Church in downtown Detroit for decades on an annual budget of less than $500,000.

en McCabe’s passion for ending chronic homelessness caught the attention of a few Ford Motor Co. executives. Ford CEO Jim Far-

ley began volunteering for the nonpro t around 2017, and the center became a destination for the Ford Volunteer Corps.

Public awareness of the center took o during the COVID-19 pandemic when it erected massive warming tents downtown for the hundreds of unhoused people who came for help in March 2020 and moved its day center to Huntington Place that fall. Its support grew and so did its budget — to $4 million this year and a projected $7 million with the opening of the campus.

Benchmarking best practices

Pope Francis Center began developing plans for the bridge housing site in 2018-19, following McCabe’s visits to 22 other shelters around the country to benchmark best practices for helping get the chronically homeless o the streets and ready to go into permanent housing.

e project was held up after an earlier plan to build the bridge housing facility in northeast Detroit on East Can eld Street near Mount Elliott was shelved amid community pushback. But in April 2022 the center closed on the purchase of city-owned land at 2911 W. Hancock St., near Warren and I-96.

Fast forward two years and the $37 million center is complete. During a tour last month, contractors were installing tile in a guest room bathroom and working on the ooring in the building’s new gymnasium as work on the campus neared completion.

e blocklong development of connected buildings includes 40 studio apartments of “bridge” housing for short-term stays of 90-

shelter that had a cooling area outside of its shelter, McCabe said. e campus will provide psychological, addiction, social and job-readiness services to help the chronically homeless prepare to move into permanent housing. It includes classrooms for job readiness training delivered by Detroit-based nonpro t Focus: Hope and support groups for those with addictions, a commercial kitchen and cafeteria that will provide job training, a barber shop, gymnasium, arts therapy room, a library and chapel. It also houses an eight-bed respite unit for homeless people discharged from the hospital but still needing care, along with dental and health clinics operated by Community Health and Social Services Center, a federally quali ed health center.

120 days. It also includes an outdoor shelter with heated sidewalks and overhead radiant heaters to keep those who aren’t ready to go into the building from freezing, an idea borrowed from a San Antonio

“We are absolutely honored to be partnering with the Pope Francis Center at the Bridge Housing Center,” Richard Bryce, chief medical o cer of CHASS, said in an email. “CHASS has been so fortunate to already partner with the Neighborhood Service Organization to provide medical care to their housing insecure patients. is experience sets us up to support the amazing work of the Pope Francis Center to create a holistic solution to nd ways to end homelessness in Detroit.”

By benchmarking best practices around the country, “we built something based on the mission itself,” McCabe said.

Sherri Welch

The new Pope Francis Center Bridge Housing Campus in Detroit includes a heated outdoor shelter for those who aren’t yet ready to go into transitional housing. | PHOTOS BY EMILY ELCONIN

Work is wrapped up on the Pope Francis Center Bridge Housing Campus.

The passion of the Rev. Tim McCabe, president and CEO of the Pope Francis Center (left), caught the attention of Ford Motor Co. executives including Jim Vella (right), who is now chairman of the Pope Francis Center.

“I don't know that another building is built speci cally for this purpose,” where so many details are in response to feedback from guests and others like the Michigan School of Psychology on what will help guests feel safe and comfortable, he said.

at feedback in uenced things like the colors of the walls — calming grays, blues and greens — the width of the hallways to help people not feel closed in and the inclusion of the outdoor shelter for those who are not yet ready to go inside. Also part of the building right o an entrance is a room that heats to 145 degrees to kill any pests living on bags and other personal items that new guests bring with them.

e center is putting the nal touches on programs and hopes by the last week of June to move the rst group of 10 men — selected from among the chronically homeless going to its downtown Detroit warming center — into the new site. Ten more will follow for each of the next three weeks until the rooms at Bridge Housing are full, McCabe said.

It has begun hiring for 22 new positions, from janitorial, maintenance and security teams to social workers, clinical directors and case workers, McCabe said, to add to its current 17 employees. It also plans to maintain its downtown day center because many of the homeless gravitate to downtown areas. But the hope is the new site will take some of the pressure o the day center.

“When I started in 2015, we were

seeing 60 to 80 people a day and now we're up over 200 most days” going to the downtown site, McCabe said.

Continued support

As construction winds down, several companies have stepped up with in-kind donations of goods and services. Ford Land brought hundreds of volunteers in midMay to move cafeteria, living area and o ce furniture it donated into the new site. Republic Services Charitable Foundation equipped the community computer lab and resident tness center. And Delta Dental out tted the dental clinic with two chairs, an X-ray room and state-of-the-art equipment.

e new site is also garnering additional public support, McCabe said. e Secretary of State is adding a mobile o ce at the Bridge Housing Campus to cut down on wait times for the homeless trying to get an identi cation card. And the city of Detroit is expected to put in a bus stop at Warren so people staying at the Bridge Housing Cam-

e hospitality industry is warning of huge rami cations, including layo s and higher food and beverage prices. Servers and bartenders who fear they may lose income wore “Save MI Tips” buttons at various Mackinac Island establishments to raise awareness of the issue during a recent Detroit Regional Chamber meeting.

pus will be able to jump on the Grand River Avenue bus and go downtown, McCabe said.

e center’s mission “really resonates with people and it's something that people really have gotten behind … individuals and corporations and nonpro ts and, you know, obviously city and state leadership. So, it's been amazing to watch this thing unfold and, and just feel that level of support,” he said.

Chad Audi, CEO of Detroit Rescue Mission Ministries, another nonpro t providing transitional housing, believes the Bridge Housing Campus will play a big role in reducing homelessness in Detroit. Beyond immediate shelter transitional housing, it provides a structured environment that fosters the development of life skills, nancial independence and improved mental and physical health, he said. e programs provide residents with the tools and resources necessary to address the root causes of their homelessness, including issues like unemployment, mental health and substance abuse.

“It worries me on the side of the servers but as well on the side of the companies,” said Ash eld Donnan, a server and bartender at Seabiscuit Cafe who has worked on the island for eight seasons since 2012.

“I just think it would be better to keep it the way that it is. It’s always been very bene cial to me. I denitely couldn’t make as much money working a di erent minimum wage job.”

Depending on the day, she said, she can make $20-$50 per hour.

Supporters of the 6-year-old ballot proposal anticipate the court will order it to take e ect. ey are urging Whitmer and the now Democratic-led Legislature to go a step further and gradually increase the minimum wage to $15 by 2027 and ensure that the “sub-minimum” tipped wage, which originated in post-slavery times, is replaced with $15 plus tips.

“I can tell you we are in conversation with the Legislature,” Whitmer said. “We don’t know what the outcome (of the ruling) is yet, so it’s hard to say what path we’re going to walk. But we want to make sure that we live up to the spirit of the intent of the people. We also want to make sure that our small businesses can survive. ere’s going to be a lot of work to do in a very short period of time on this front with big rami cations for people.”

She has previously expressed concern about an “overnight” spike in the minimum wage. She has said it probably would not be sustainable for all businesses and that she is pragmatic and not afraid to “create some waves.”

To prevent the minimum wage and earned sick time initiatives from going to voters in 2018, Republican lawmakers approved them so they could be more easily altered after the election with simple majority votes rather than the three-fourths support that would have been needed if the public had passed the proposals.

retain the tip credit. Forty-three states have one. Servers are making on average close to $30 an hour right now. ey’re doing well. ey prefer this system to one with a higher base wage and an uncertain future on tips,” said Justin Winslow, president and CEO of the Michigan Restaurant & Lodging Association.  Doing away with the tip credit, he said, would increase restaurants’ labor costs for tipped workers by 250%. He pointed to Washington, D.C., where restaurants assess service fees of up to 20% to absorb costs from the phaseout of a tip credit.

He said conversations with Whitmer and legislators date to 2022 and have been “surprisingly positive.”

Saru Jayaraman, president of One Fair Wage, which backed the 2018 minimum wage ballot drive and a later initiative that will not be on the 2024 ballot, said to ll jobs in low-wage sectors, “we have to pay them enough to live anywhere near where they’re working. And for these workers, the a ordability crisis, the in ation that started during the pandemic, never abated.”

She said Democrats have an opportunity to “get credit” by boosting the wage higher after gaining full power in Lansing for the rst time in more than 40 years. at could prove bene cial in November when control of the state House, Congress and the White House are at stake.

“People in Michigan will not associate any party or a candidate with 15 unless they actually run on it and/or deliver,” Jayaraman said. “If we want turnout and if we want to see enthusiasm … if Democrats want turnout for Democrats, they actually have to deliver on the issue because working people, especially restaurant workers, will tell you we’ve had a stagnated sub-minimum wage for tipped workers for 40 years under both Democratic and Republican administrations.”

Rep. Donovan McKinney, D-Detroit, said he is disappointed that the Supreme Court did not order the latest proposal on the ballot (there were issues with the wording, and the state elections board had deadlocked). But he expects

“The top priority for the restaurant industry is to nd a pathway to retain the tip credit.”

Justin Winslow, president and CEO of the Michigan Restaurant & Lodging Association

the court will “make the right decision” on adopt-and-amend.

e amount of mandatory paid leave at larger employers is 40 hours, not 72 hours as proposed by the ballot measure, and employers with fewer than 50 employees are exempt from having to o er paid sick days following the adopt-andamend strategy.

A Court of Claims judge voided the maneuver in 2022 while the Michigan Court of Appeals ruled it was constitutional in 2023. If the justices restore the ballot measures, those tracking the lawsuit expect a delay in the decision’s effective date to give legislators time to respond.

“ e top priority for the restaurant industry is to nd a pathway to

“Once that decision is made, us in the Legislature must take upon ourselves to ensure that $15 is the law of the land in our state,” he said, adding it is the top issue for many voters who are struggling to make ends meet.

But Senate Minority Leader Aric Nesbitt, R-Porter Township, said: “Republicans stand ready to protect restaurant workers.” He worries majority Democrats will be unable to get votes on their side of the aisle to make changes if the court restores the 2018 wage initiative.

“We stand ready to nd a solution compared to what’s ahead if the Supreme Court makes what I would think is a wrong-headed decision,” he said.

Amenities on the 5.3-acre Pope Francis Center Bridge Housing Campus in Detroit include a gymnasium. EMILY ELCONIN

Emails were sent to spokespeople for GM as well as Gilbert’s Bedrock LLC real estate company, which is involved in the discussions, seeking comment May 31.

Last month, Gilbert said at the Mackinac Policy Conference that executives and bureaucrats were deliberating over the complex’s future.

“But I think that everybody is interested in keeping some very exciting and promising development on that property, whoever comes up with it,” Gilbert said at the conference. “We are in a sort of a brainstorming mode right now, and that’s just very important. ose (buildings) have been landmarks for the city for decades now and it’s beautiful riverfront land and property.”

Wayne County is among the leaders at the table discussing the RenCen’s future, Gilbert said last month. And Wayne County Executive Warren Evans delivered ocial remarks during the April news conference in which GM announced it was moving its headquarters from the RenCen to the Hudson’s Detroit development.

e prospect of Wayne County moving out of the Guardian Building has been discussed over the years, including when the county teetered on insolvency in the middle part of the last decade.

“There’s not a demand for four stories of of ce towers, and there won’t be any time in the foreseeable future.”

Mayor Mike Duggan

However, those conversations have always been punctuated by two things: e county wants to be in a location with convenient access to all county residents, and there are millions in outstanding capital improvement bonds that need to be retired if the county was to sell the Guardian, a 40-story Art Deco skyscraper at 500 Griswold St. that opened in 1929.  “ is building is not particular-

ly good for customer service for a county o ce — it just isn’t,” Evans said in an interview with Crain’s three years ago. “Would I rather be in another building that was more accessible to the public and had better parking? Yes, I would.”

Crain’s reported in 2021 that the county owed about $44 million in bond debt out of $60 million it was authorized to issue in 2008 when it bought the building

from Detroit-based Sterling Group for $14.5 million. It’s not known how much the county owes today. e bonds are to be retired by 2055.

A Wayne County relocation to the RenCen has undoubtedly been one of many possibilities for the riverfront complex going forward, although its ultimate fate remains under deliberation behind closed doors.

O cials have said they are exploring ways to reuse the ve-skyscraper portion of the RenCen owned by GM, although demolition of at least some of the complex remains an option.   e automaker is committed to

coming up with “a good solution” for the RenCen, GM CEO Mary Barra said at the Detroit Economic Club last month. And Mayor Mike Duggan told e Detroit News last month at the Mackinac Policy Conference that “what can be saved will be saved,” without vowing to keep the entire complex standing.

“ ere’s not a demand for four stories of o ce towers, and there won’t be any time in the foreseeable future,” Duggan told e News. “What can be saved will be saved. We didn’t bring Dan Gilbert in to demolish the Renaissance Center. We don’t need Dan Gilbert for that.”

From left: Wayne County Executive Warren Evans, General Motors Co. CEO Mary Barra, Bedrock founder Dan Gilbert and Detroit Mayor Mike Duggan on April 15, when GM announced it would move from the Renaissance Center (right) to the Hudson’s Detroit development next year. | KELLIN WIRTZ/BEDROCK AND DEAN STORM/CRAIN COMMUNICATIONS

Macomb attracts public, private funds to build nonpro t capacity

Sherri Welch

New funding is owing to Macomb County to help grow nonpro t capacity in the high-need community.

e Ralph C. Wilson Jr. Foundation has awarded Advancing Macomb a $600,000 grant over three years to help bolster nonpro ts in the county while also strengthening its own sta .

e grant comes on the heels of a $50,000 contract awarded by the county to Advancing Macomb to provide nonpro ts with the same sorts of support and two years after a report from the Dorothy A. Johnson Center for Philanthropy at Grand Valley State University found Macomb County trails other counties in the region in the number of charitable nonpro ts and philanthropic investment.

“ rough the incubator initiative, a large focus for the organization really is building the nonpro t sector in Macomb County so they can be more successful, more sustainable and more impactful in their missions,” said Phil Gilchrist, executive director of Advancing Macomb.

He often hears from nonpro ts

SCANDAL

From Page 1

e falsi ed bank statements led to misrepresentations in the organization’s nancial statements, according to charges leveled against Smith in federal court June 5.

After the issues were discovered internally, the conservancy’s leaders requested an independent forensic audit by PwC and sought counsel from the Honigman law rm and its lead partner for investigations, former U.S. Attorney Matthew Schneider. Last month, Smith was put on leave and the ndings were turned over to authorities, with the investigation eventually landing at the FBI due to the complexities involved.

“As volunteers, we believed that the right team and processes were in place to protect the nancial integrity of the organizations,” the conservancy’s board said in a resolution quoted in a May 31 news release. “ at belief was disabused by the recent discovery of this signi cant nancial crime.” e conservancy has launched a review of its internal controls.

Chairman Matt Cullen has recruited board members and business leaders from outside the organization to analyze its accounting/nance, governance and operations systems and make recommendations about how to improve them to not only “de ne the future state” of the conservancy but also to produce “a best-in-class model” to potentially help other nonpro ts.

On May 30, Detroit Riverfront Conservancy board member Margaret Trimer, who is vice president of strategic partners for Delta Dental of Michigan, Ohio and In-

that they can’t nd enough volunteers, struggle to build an individual donor base and don’t understand how to seek or obtain grant funds, among other things, he said.

“ ese are also some of the very things which would increase a nonpro t’s capacity and close gaps in service provision,” he said.

Unless they are very large and well-resourced, nonpro ts in the county don’t have the same connections to support organizations and funders that larger organizations do, Gilchrist said.

With the strategic investment in Advancing Macomb, “we anticipate this growing organization will launch a new era of support for nonpro t growth and philanthropic interest in Macomb County leading to better outcomes and an improved quality of life for residents,” Jim Boyle, vice president of programs and communications at the Wilson foundation, said in a release.

“ e implementation of the nonpro t incubator will also connect Advancing Macomb to other intermediaries and regional capacity builders strengthening the network of support across the county.”

diana, took to Facebook to urge other nonpro ts and leaders to scrutinize their accounting/ nancial controls and systems.

“DO NOT have one and only one person in control of it all,” she wrote in the post. “Switch up your auditors every few years, stay in close touch with your banks. Do an internal audit of your systems NOW.  No joke.”

Trimer also urged leaders to make sure their audit/ nance committees have “numbers people extraordinaire” leading them.

“I believe the template in place for non-pro t nancial management was built for a di erent era. We need to build a better one going forward. Do this proactively. Do not get caught in a knot you have to untangle. Friendly advice,”

Trimer wrote.

Fraud awareness training works

As an industry, nonpro ts represented the smallest percentage of cases (10%) in the Association of Certi ed Fraud Examiners’ “Occupational Fraud 2024: A Report to the Nations” study. And they saw a median loss of about $76,000 — roughly half the loss for-pro ts and government groups reported.

But the report noted that nonpro ts, which operate on tighter budgets and can su er from loss of funder and donor con dence with embezzlements, also have the lowest implementation rate of fraud awareness training. Nonpro ts that provided such training uncovered frauds more than 2.5 times faster than organizations that did not, the association said.

e alleged embezzlement at the Detroit Riverfront Conservan-

As a nonpro t intermediary, Advancing Macomb brings public, private and nonpro t groups together and works to raise the visibility of the county and attract resources to fund projects and programs for residents. It serves as a duciary for a $1 million grant from the Wilson foundation for a new crossing over the Clinton River spillway that will improve pedestrian safety and provide a new link in the Great Lakes Way trail system and federal funding for improvements to a Mount Clemens community center and a former school building being converted to a youth programs center, Gilchrist said.

Advancing Macomb is operating on a $1.3 million budget this year, including $900,000 in passthrough funding for the other projects. Its duciary role speaks to the low capacity of nonpro ts in the county, Gilchrist said. “Few could attract, much less manage a federal earmark,” he said.

Advancing Macomb is setting out to change that. It will use the funding from the Wilson foundation to build on similar e orts it has o ered nonpro ts in the county, providing “a boot camp or non-

cy, an organization shepherding hundreds of millions of dollars from foundations and private donors, has raised awareness of the possibility of issues among Plante Moran’s clients, said John Bebes, partner, assurance at the Southeld o ce of the certi ed public accounting and business advisory rm. “ ey are asking questions like, ‘Could this happen to me?’”

Internal controls long acknowledged as best practice can help nonpro ts see red ags, experts said.

Top among them is segregation of duties, meaning one person cannot initiate and approve access to money. ere should always be a couple of people initiating and approving all nancial transactions, Bebes said.

“From the smallest to the largest organization, segregation of duties is a key control, no matter what,” he said.

e board also needs to be diligent about reviewing nancial information on a timely basis and bank reconciliations to ensure what’s being run through the account is appropriate, nonpro t accounting experts said.

Timely reviews — at least once monthly — are key, Bebes stressed. “If you do something four, ve months later … it could be long gone,” he said.

Leaders should also be reviewing transactions, invoices, employee schedules and payroll so no ghost employees are being paid and levels of vacation paid out are appropriate, Bebes said.

Still, it’s not enough just to establish policies, he said. Nonpro t leaders have to enforce them. “ is can happen to any organization at any time. at’s why you

pro t 101,” focused on the basics of nonpro t management, compliance, governance and fundraising for volunteer-led nonpro ts or those with only a sta member or two.

“ e bottom line is building nonpro t capacity,” Gilchrist said. “What we have found is that those organizations in Macomb County tend to have a more di cult time connecting to the broader sector and resources.”

Advancing Macomb will team up with other nonpro t intermediaries such as Detroit-based Co.act, the Michigan Nonpro t Association, Community Legal Resources, Nonpro t Enterprise at Work and Nonproft Network to provide the

have to be watchful of every day of every year that you’re in existence,” Bebes said.

Baker Tilly US LLP also recommends that nonpro ts have separate nance and audit committees. e audit committee hires the audit rm, reviews audits and is the rst to review draft IRS Form 990s and audits before they go to the full board. And the nance committee should review internal nancial statements, working closely with the organization’s CFO, said Laurie Horvath, nonpro t principal in the advisory, tax and assurance rm’s South eld o ce.

“ ose are two separate functions. It’s good to have people who are focused on the audit and then people who are focused on (internal nancials),” she said. “To really narrow the focus is a best practice.”

Focused review on internalnancials can help leaders identify trends going in a di erent direction than they should, to compare what was spent vs. what was budgeted and track where cash should be, Horvath said. e processes are really critical and important for everyone to stick to at all times.

“ ey have to be on paper and then they need to be in process,” she said.

What are red ags?

If nonpro ts have proper internal controls in place and they are making sure they are enforced, they should be able to notice red ags in nancials, but there are other things they should keep an eye on, too, experts advise.

If the lifestyle of an employee or executive is lavish and doesn’t match their pay, it’s notable. It could be explained through something

county’s small nonpro ts with “the type of stu that people really need to have a grasp on in order for their nonpro t to be sustainable and successful,” Gilchrist said. e boot camp program will provide education in those areas through a cohort model to build the network of Macomb County nonpro ts and introduce participating organizations to other nonpro t intermediaries and resources available in the region. e Wilson foundation grant will also fund the hire of a manager for the incubator program and an o ce manager over the next two years, doubling the number of employees Advancing Macomb itself has, Gilchrist said.

like an inheritance, “but it’s something boards and leaders should be watchful and aware of,” Bebes said. Oklahoma boutique law rm Nonpro t Solution notes that and other red ags, including: An employee who never takes a vacation or time o , preventing another from reviewing their work ◗ Delayed or denied access tonancial records

◗ An angry or overly hurt response from an employee questioned about embezzlement

Letting employee trust supercede internal controls

Guarding against the trust that naturally builds among leaders and co-workers over a period of time is paramount, nonpro t experts said.

“Somebody is a nice person, and you trust them, and potentially, your guard comes down,” Bebes said.

For example, despite the vast difference in their budgets, the Ann Arbor Amateur Hockey Association whose treasurer embezzled nearly $1 million a decade ago when it was operating on a budget of just $546,000, and the Detroit Riverfront Conservancy, which is facing a loss of 40 times that amount, have something in common: Both organizations trusted the people central to the problem. e nancial controls are about the position and not the person, regardless of whether they are new to the role or have been there for years, Horvath said.

It’s all in the interests of safeguarding the assets and employees knowing the process and following it all of the time, she said.

“We like to remind our clients that trust is not an internal control,”  Horvath said.

Colleen Thompson of Bridgebuilding Strategies leads a strategic planning workshop for Macomb County nonpro ts hosted as part of Advancing Macomb’s Nonpro t Roundtable program. | ADVANCING MACOMB

New Birmingham Shopping District leader focuses on her vision for downtown

New Birmingham Shopping District Executive Director Erika Bassett sees great things in the future for the Oakland County city. The 41-year-old Birmingham resident took on her new role in May after nearly four years as marketing and public relations specialist for the shopping district. Bassett takes over for Cristina Sheppard-Decius, who left the position in February after about a year and a half. Bassett talks with Crain’s about her new role, downtown Birmingham’s viability and her vision for the shopping district. By | Jay Davis

You’ve been with the Birmingham Shopping District for four years. Was becoming the director of the shopping district one of your goals?

I’ve enjoyed developing and executing strategies in partnership with the shopping district board to support and promote downtown Birmingham in a variety of ways. As the executive director, I’m looking forward to continuing to serve the board, businesses and community in an expanded role.

In your time with the Birmingham Shopping District, what have you learned that prepares you for your new role?

Being a Birmingham resident, I’ve always frequented downtown Birmingham to shop, eat, visit parks, and enjoy community events and activities. In my time as an employee of the shopping district and the city, I’ve had the chance to make more personal connections with our business owners, my colleagues and other stakeholders, while learning the day-to-day operations.

What is your vision as director of the Birmingham Shopping District?

rough strategic initiatives and partnerships, we’ll continue to cultivate an environment where businesses can thrive. We continue to attract talent, culture and innovation. Our reach continues to expand, ensuring that downtown Birmingham remains a center for economic growth and community connection.

What are some of the plans you have for the shopping district?

We’re constantly looking toward the future here in Birmingham, while maintaining our downtown’s historical character and charm. With some of our large infrastructure projects throughout the downtown now complete, we’re working on some new initiatives in partnership with the city, including the addition of new way nding and gateway signage, alley and road improvement projects. We’ve also added new events and activities this year to engage the community in new ways.

“Through strategic initiatives and partnerships, we’ll continue to cultivate an environment where businesses can thrive.”

Erika Bassett, Birmingham Shopping District

You gave shopping district businesses a chance to participate in a free service-focused workshop offered by Zingerman’s ZingTrain arm. Why did the shopping district decide to pay for the workshop?

e shopping district board is committed to supporting our businesses through educational training and other opportunities as part of our business retention strategy. We conducted a survey among member businesses on what types of workshops they would like to participate in

and customer service was one of the most requested topics, along with marketing and social media.

What challenges do you see in bringing new businesses to the area?

e changing nature of retail in general has an impact on all downtowns nationwide, including Birmingham. We’re fortunate to have a local and regional community that strongly supports our businesses, and a business mix that continues to attract

signi cant interest from both national and local businesses.

Birmingham is one of the more popular suburban shopping districts in the area. Are there any brands you’d like to see come into the area?

We have over a dozen projects currently in development like the ve-story RH Gallery, several mixed-use projects, some local business expansions and new national tenants.

Constant analysis of our business mix and evaluation of community downtown usage help us to identify strategies to target our recruitment e orts.

Are you planning to meet with or talk with any of those prospective vendors? We’ll continue to engage and partner in recruitment e orts with our local brokers through the identi cation of potential target tenants and the development of relevant resources to assist them.

There have been some long-standing Birmingham businesses that have closed in the last few years. When that happens, is it easy to draw new vendors in?

Whether it is due to a corporate shift or a local owner retirement, we are always sad to see long-standing businesses close. But our retail occupancy rate has remained near 99% for the last several years and interest in vacant spaces continues to be extremely high.

How do you sell new businesses on opening up in Birmingham?

Our strong local and trade area demographics, the current tenant mix and consumer tra c statistics, along with the city’s “big city” amenities and small-town charm make it highly attractive to potential businesses — both local and national.

How will downtown Birmingham look in ve years?

I think the future is very bright for downtown Birmingham. Our vibrant community will welcome many new retailers and restaurants within the next few years. We will continue to implement enhanced accessibility features, and expand signature community events and activities.

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